Synthetic funds having structured notes

• US 20040024671A1
• Filed: 06/03/2003
• Published: 02/05/2004
• Est. Priority Date: 08/02/2002
• Status: Active Grant

• Current Assignee: JP Morgan Chase Bank, N.A. (JP Morgan Chase & Co)
• Original Assignee: Chase Manhattan International Incorporated (JP Morgan Chase & Co)
• Inventors: Freund, Peter C.
• Granted Patent: US 7,606,756 B2
• Time in Patent Office: Days
• US Class Current: 705/35
• CPC Class Codes: G06Q 20/00 Payment architectures, schemes or protocols apparatus for performing or posting payment transactions G07F7/08, G07F19/00; electronic cash registers G07G1/12
• CPC Class Codes: G06Q 20/06 Private payment circuits, e.g. involving electronic currency used among participants of a common payment scheme
• CPC Class Codes: G06Q 20/363 with the personal data of a user
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis
• CPC Class Codes: G06Q 40/12 Accounting
• CPC Class Codes: G07F 7/0866 by active credit-cards adapted therefor G07F7/1008 takes precedence
• CPC Class Codes: Y10S 707/99933 Query processing, i.e. searching
• CPC Class Codes: Y10S 707/99953 Recoverability

Abstract

The present invention relates to synthetic funds for purchase by investors. A structured note is structured to provide customized equity returns/exposure. Terms of each structured note may be specified by the purchaser and the structured notes may be unsecured liabilities of the obligor, e.g., there are no underlying assets upon which the structure note is based. Thus, there will be no limits on the use of structured note proceeds and management of assets and liabilities will be left entirely to the obligor'"'"'s discretion. Structured note payment obligations may be related to the performance of an objective valuation, but structured note holders will depend on the good credit of the obligor for payment.

Claims

1. A process for creating and issuing a synthetic fund comprising:

receiving a request to purchase at least one structured note, where the request comprises;

an amount of the at least one structured note; and

at least one term of the at least one structured note;

generating the at least one structured note based on the request;

receiving payment for the at least one structured note; and

issuing the at least one structured note, where the at least one structured note is an unsecured liability of the obligor.

2. The process according to claim 1, where the terms of the note further comprises a valuation of the at least one structured note based on at least one objective valuation measure.

3. The process according to claim 2, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

4. The process according to claim 2, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

5. The process according to claim 1, where the terms of the at least one structured note further comprises a time period for redeeming the at least one structured note.

6. The process according to claim 5, where the terms of the at least one structured note further comprises a valuation of the at least one structured note;

and

where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

7. The process according to claim 2, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

8. A process for creating and issuing a synthetic fund comprising:

receiving a request to purchase at least one structured note, where the request comprises;

an amount of the at least one structured note; and

at least one term of the at least one structured note, where the at least one term of the note includes;

a) a valuation of the at least one structured note based on at least one objective valuation measure; and

b) a time period for redeeming the at least one structured note generating the at least one structured note based on the request;

receiving payment for the at least one structured note; and

issuing the at least one structured note, where the at least one structured note is an unsecured liability of the obligor.

9. The process according to claim 8, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

10. The process according to claim 9, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

11. The process according to claim 9, where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

12. The process according to claim 8, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

13. A process for creating and issuing a synthetic fund comprising:

receiving a request to purchase at least one structured note, where the request comprises;

an amount of the at least one structured note; and

at least one term of the at least one structured note, where the at least one term of the note includes;

a) a valuation of the at least one structured note based on at least one objective valuation measure, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure; and

b) a time period for redeeming the at least one structured note, where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note;

generating the at least one structured note based on the request;

receiving payment for the at least one structured note, where the payment for the structured note is based on the objective valuation measure at the time of the payment; and

issuing the at least one structured note, where the at least one structured note is an unsecured liability of the obligor.

14. The process according to claim 13, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

a fund of funds;

an inflation index;

a hedge fund; and

an interest rate.

15. A synthetic fund for purchase as a financial product comprising:

a structured note issued by an obligor, where the structured note is an unsecured liability of the obligor, and the structure note comprises at least one term, where the at least one term includes a valuation based on at least one objective valuation measure.

16. The synthetic fund according to claim 15, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

17. The process according to claim 16, where the at least one term further comprises a time period for redeeming the at least one structured note.

18. The process according to claim 17, where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

19. The synthetic fund according to claim 15, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

a fund of funds;

an inflation index;

a hedge fund; and

an interest rate.

20. The process according to claim 15, where payment for the structured note is based on the objective valuation measure at the time of the payment.

21. A synthetic fund for purchase as a financial product comprising:

a structured note issued by an obligor, where the structured note is an unsecured liability of the obligor, and the structure note comprises at least one term, where the at least one term includes a valuation based on at least one objective valuation measure and a time period for redeeming the at least one structured note, where payment for the structured note is based on the objective valuation measure at the time of the payment.

22. The synthetic fund according to claim 21, where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

23. The synthetic fund according to claim 21, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

24. The synthetic fund according to claim 23, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

25. A synthetic fund for purchase as a financial product comprising:

a structured note issued by an obligor, where the structured note is an unsecured liability of the obligor, and the structure note comprises a plurality of terms comprising a valuation based on at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure and a time period for redeeming the at least one structured note, where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note, and where payment for the structured note is based on the objective valuation measure at the time of the payment.

26. The synthetic fund according to claim 25, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a hedge fund; and

an interest rate.

27. A system for issuing a structured note for a synthetic fund, the system comprising:

a request module for receiving a request to purchase the structured note;

a generating module for generating the structured note;

an purchase module for receiving payment to purchase the structured note; and

an issuing module for issuing the structured note in response to the request, where the structured note is an unsecured liability of the obligor.

28. The system according to claim 27, where the request comprises the terms of the structured note and the amount of purchase.

29. The system according to claim 28, where the terms of the structured note comprise the valuation of the note based on an objective valuation measure.

30. The system according to claim 29, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

a fund of funds;

an inflation index;

a hedge fund; and

an interest rate.

31. The system according to claim 29, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

32. The system according to claim 27, where the terms of the at least one structured note further comprises a time period for redeeming the at least one structured note.

33. The system according to claim 32, where the terms of the at least one structured note further comprises a valuation of the at least one structured note;

and

where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

34. The system according to claim 27, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

35. The system according to claim 27, where the generating module generates a unique identifier for the structured note and where the purchaser has an identifier.

36. The system according to claim 35, further comprising a storage module, where the storage module stores and links the unique identifier for the structured note and the purchaser identifier.

37. The system according to claim 36, where the request comprises the terms of the structured note and the amount of purchase;

and

where the storage module further stores and links the terms of the structured note and the amount of purchase to each other and to the respective unique identifier for the structured note and the purchaser identifier.

38. A system for issuing a structured note for a synthetic fund, the system comprising:

a request module for receiving a request to purchase the structured note, where the request comprises the terms of the structured note and the amount of purchase, and where the terms of the at least one structured note further comprise the valuation of the structured note and a time period for redeeming the at least one structured note;

a generating module for generating the structured note, where the generating module generates a unique identifier for the structured note and where the purchaser has an identifier;

an purchase module for receiving payment to purchase the structured note;

an issuing module for issuing the structured note in response to the request, where the structured note is an unsecured liability of the obligor; and

a storage module, where the storage module stores and links the unique identifier for the structured note and the purchaser identifier.

39. The system according to claim 38, where the valuation is based on an objective valuation measure.

40. The system according to claim 39, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

41. The system according to claim 38, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

42. The system according to claim 41, where the terms of the at least one structured note further comprises a valuation of the at least one structured note;

and

where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

43. The system according to claim 38, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

44. The system according to claim 38, where the request comprises the terms of the structured note and the amount of purchase;

and

where the storage module further stores and links the terms of the structured note and the amount of purchase to each other and to the respective unique identifier for the structured note and the purchaser identifier.

45. A system for issuing a structured note for a synthetic fund, the system comprising:

means for receiving a request to purchase the structured note;

means for generating the structured note;

means for receiving payment to purchase the structured note; and

means for issuing the structured note in response to the request, where the structured note is an unsecured liability of the obligor.

46. The system according to claim 45, where the request comprises the terms of the structured note and the amount of purchase.

47. The system according to claim 46, where the terms of the structured note comprise the valuation of the note based on an objective valuation measure.

48. The system according to claim 47, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

49. The system according to claim 47, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

50. The system according to claim 45, where the terms of the at least one structured note further comprises a time period for redeeming the at least one structured note.

51. The system according to claim 50, where the terms of the at least one structured note further comprises a valuation of the at least one structured note;

and

where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

52. The system according to claim 45, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

53. The system according to claim 45, where the generating module generates a unique identifier for the structured note and where the purchaser has an identifier.

54. The system according to claim 53, further comprising a means for storing and linking the unique identifier for the structured note and the purchaser identifier.

55. The system according to claim 54, where the request comprises the terms of the structured note and the amount of purchase;

and

where the storage module further stores and links the terms of the structured note and the amount of purchase to each other and to the respective unique identifier for the structured note and the purchaser identifier.

59. The system according to claim 54, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

60. The system according to claim 59, where the terms of the at least one structured note further comprises a valuation of the at least one structured note;

and

where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

56. A system for issuing a structured note for a synthetic fund, the system comprising:

means for receiving a request to purchase the structured note, where the request comprises the terms of the structured note and the amount of purchase, and where the terms of the at least one structured note further comprise the valuation of the structured note and a time period for redeeming the at least one structured note;

means for generating the structured note, where the generating module generates a unique identifier for the structured note and where the purchaser has an identifier;

means for receiving payment to purchase the structured note;

means for issuing the structured note in response to the request, where the structured note is an unsecured liability of the obligor; and

means for storing and linking the unique identifier for the structured note and the purchaser identifier.

57. The system according to claim 56, where the valuation is based on an objective valuation measure.

58. The system according to claim 57, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

61. The system according to claim 56, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

62. The system according to claim 56, where the request comprises the terms of the structured note and the amount of purchase;

and

where the storage module further stores and links the terms of the structured note and the amount of purchase to each other and to the respective unique identifier for the structured note and the purchaser identifier.

63. A computer readable medium for causing a process to issue a structured note for a synthetic fund, the medium comprising:

code for receiving a request to purchase the structured note;

code for generating the structured note;

code for receiving payment to purchase the structured note; and

code for issuing the structured note in response to the request, where the structured note is an unsecured liability of the obligor.

64. The medium according to claim 63, where the request comprises the terms of the structured note and the amount of purchase.

65. The medium according to claim 64, where the terms of the structured note comprise the valuation of the structured note based on an objective valuation measure.

66. The medium according to claim 65, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

67. The medium according to claim 63, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

68. The medium according to claim 63, where the terms of the at least one structured note further comprises a time period for redeeming the at least one structured note.

69. The medium according to claim 68, where the terms of the at least one structured note further comprises a valuation of the at least one structured note;

and

where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

70. The medium according to claim 63, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

71. The medium according to claim 63, where the code for generating generates a unique identifier for the structured note and where the purchaser has an identifier.

72. The medium according to claim 63, further comprising a code for storing and linking the unique identifier for the structured note and the purchaser identifier.

73. The medium according to claim 63, where the request comprises the terms of the structured note and the amount of purchase;

and

where the code for storing further stores and links the terms of the structured note and the amount of purchase to each other and to the respective unique identifier for the structured note and the purchaser identifier.

74. A computer readable medium for causing a processor to issue a structured note for a synthetic fund, the medium comprising:

code for receiving a request to purchase the structured note, where the request comprises the terms of the structured note and the amount of purchase, and where the terms of the at least one structured note further comprise the valuation of the structured note and a time period for redeeming the at least one structured note;

code for generating the structured note, where the generating module generates a unique identifier for the structured note and where the purchaser has an identifier;

code for receiving payment to purchase the structured note;

code for issuing the structured note in response to the request, where the structured note is an unsecured liability of the obligor; and

code for storing and linking the unique identifier for the structured note and the purchaser identifier.

75. The medium according to claim 74, where the valuation is based on an objective valuation measure.

76. The medium according to claim 75, where the at least one objective valuation measure is one of:

a mutual fund;

a stock market index;

a bond fund;

a bond index;

an inflation index;

a fund of funds;

a hedge fund; and

an interest rate.

77. The medium according to claim 74, where the valuation is based on the at least one objective valuation measure without a predetermined amount of fees associated with the objective evaluation measure.

78. The medium according to claim 77, where the terms of the at least one structured note further comprises a valuation of the at least one structured note;

and

where the valuation of the at least one structured note is based in part on the time period for redeeming the at least one structured note.

79. The medium according to claim 74, where the payment for the structured note is based on the objective valuation measure at the time of the payment.

80. The medium according to claim 74, where the request comprises the terms of the structured note and the amount of purchase;

and

where the code for storing further stores and links the terms of the structured note and the amount of purchase to each other and to the respective unique identifier for the structured note and the purchaser identifier.