Trading system supporting credit rating

• US 20040260639A1
• Filed: 06/17/2003
• Published: 12/23/2004
• Est. Priority Date: 06/17/2003
• Status: Active Grant

• Current Assignee: Nasdaq Technology AB (Nasdaq, Inc.)
• Original Assignee: OM Technology AB (OM Gruppen AB)
• Inventors: Lundberg, Jonas, Ahlenius, Ulf
• Granted Patent: US 7,801,797 B2
• Time in Patent Office: Days
• US Class Current: 705/37
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

In a trading system providing an anonymous market orders in the market will be executed using cryptographic keys. All traders can view all orders and use their specific key to determine the particular rating of the order in accordance with the traders'"'"' own preferences. Since the same order information is sent to everybody the bandwidth requirements will be kept at a minimum and also the processing will be kept at a minimum.

Claims

1. An automated exchange system providing an anonymous market comprising a number of remote terminals connected to a central computer server hosting a matching processor and including a memory forming a orderbook, the content of which is transmitted to the remote terminals for display there, the system further comprising means for centrally storing mutual credit ratings for trading parties connected to the system, wherein the system additionally comprises:

means for issuing an individual decoding key to each trading party

means for transmitting orderbook information including credit rating information in a format decodable by said decoding key, and

means for displaying orders of the orderbook indicating the mutually established credit rating of the orders.

2. A system according to claim 1, wherein only orders that a trading party is free to trade against are displayed.

3. A system according to claim 1, wherein the credit rating information transmitted is encrypted using an encryption algorithm preventing easy identification of a holder of a particular order.

4. A system according to claim 1, wherein the orderbook information is transmitted as a broadcast message to all traders currently connected to the exchange system.

5. A system according to claim 1, wherein the system further comprises means for transmitting a new decoding key to a trader when the credit rating of a counter party is changed.

6. A system according to claim 1, wherein all traders are given a unique decoding key irrespective of the credit rating established for the trader'"'"'s counter party.

7. A system according to claim 1, wherein the decoding key of a trader only is enabled using the signature of a trader authorized by the system.

8. A system according to claim 1, wherein the display indicating the credit rating status of an order is made using different colors.

9. A system according to claim 1, wherein the system provides for indicating a credit rating status of a counter party in at least three different levels.

10. A system according to claim 1, wherein the means for transmitting orderbook information including credit rating information are arranged to only transmit credit rating information at a predetermined time interval.

11. A system according to claim 10, wherein said time interval is set in accordance with the current server traffic load.

12. A system according to claim 1, further having means to receive a query from a trader relating to the credit rating of an order in the orderbook and means for responding to such a query.

13. A system according to claim 12, wherein the means for responding to such a query are arranged to only transmit a response message including credit rating information to the trader from whom the query is received.

14. A system according to claim 13, wherein said response message is transmitted uncoded.

15. In an automated exchange system providing an anonymous market a method of disseminating credit rating information to a number of remote terminals connected to a central computer server hosting a matching processor and including a memory forming a orderbook, the content of which is transmitted to the remote terminals for display there, the method comprising the steps of:

in said server receiving and storing mutual credit ratings for trading parties connected to the system,

issuing an individual decoding key to each trading party

transmitting orderbook information including credit rating information in a format decodable by said decoding key, and

displaying orders of the orderbook indicating the mutually established credit rating of the orders.

16. A method according to claim 15, wherein only orders that a trading party is free to trade against are displayed.

17. A method according to claim 15, wherein the credit rating information transmitted is encrypted using an encryption algorithm preventing easy identification of a holder of a particular order.

18. A method according to claim 15, wherein the orderbook information is transmitted as a broadcast message to all traders currently connected to the exchange system.

19. A method according to claim 15, wherein a new decoding key is transmitted to a trader when the credit rating of a counter party is changed.

20. A method according to claim 15, wherein all traders are given a unique decoding key irrespective of the credit rating established for the trader'"'"'s counter party.

21. A method according to claim 15, wherein the decoding key of a trader only is enabled using the signature of a trader authorized by the system.

22. A method according to claim 15, wherein the display indicating the credit rating status of an order is made using different colors.

23. A method according to claim 15, wherein a credit rating status of a counter party is displayed in at least three different levels.

24. A method according to claim 15, wherein credit rating information is only broadcast at predetermined time intervals.

25. A method according to claim 24, wherein said time interval is set in accordance with the server traffic load.

26. A method according to claim 15, wherein the server transmits credit rating information to a particular trader as a response to a query sent by said particular trader.

27. A method according to claim 15, wherein the key only can be enabled using an n authorized signature of a user of the system.

28. A method according to claim 23, wherein said at least three levels include one level indicating that trading is allowed and one level indicating that trading is forbidden.

29. A trader terminal for connection to a central server matching bids and offers from a number of trader terminals, the trader terminal comprising:

means for receiving and storing a key for decoding messages from the server, said messages comprising information relating to orders matched in the server and related credit rating information.

30. A trader terminal according to claim 29, further comprising means for sending a query to the central server requesting credit information on orders currently stored in the server.

31. A trader terminal according to claim 29, further comprising means for decoding order information received from the server using said key and displaying an order in accordance with decoded credit rating information associated with the order.

32. A trader terminal according to claim 31, further comprising means for displaying each order using a particular color indicating the credit rating of each order.

33. A trader terminal according to claim 32, wherein the number of colors is at least three.

34. A server for matching bids and offers received from a number of remote trading terminals trading on behalf of a number of trading parties, the server comprising a matching unit and an associated orderbook and further comprising an additional memory for storing a matrix relating to mutual credit rating between different trading parties, the server additionally comprising:

a module for issuing a key for decoding messages relating to credit rating of an order in the orderbook to each remote trading terminal.

35. A server according to claim 34, wherein the key is unique to each trading party.

36. A server according to claim 34, wherein the key is unique to each trading terminal.

37. A server according to claim 34, wherein the server is programmed to block each attempted trade between two trading parties that are forbidden to trade in accordance with the current credit matrix.

38. A server according to claim 34, further comprising a unit for continuously broadcasting orderbook information comprising a coded data field indicating the credit rating of each order.

39. A server according to claim 38, wherein said broadcasting unit is programmed to only transmit said coded data field at a predetermined periodicity.