System and method for the automated brokerage of financial instruments

• US 8,655,755 B2
• Filed: 10/22/2003
• Issued: 02/18/2014
• Est. Priority Date: 10/22/2003
• Status: Active Grant

• Current Assignee: Scottrade Incorporated (Charles Schwab Corporation)
• Original Assignee: Scottrade Incorporated (Charles Schwab Corporation)
• Inventors: Tully, Michael James, Scott, Virgil Michael, Randle, Dwayne Oliver, Lembree, Gregory Paul
• Primary Examiner(s): JOHNSON, GREGORY L
• Application Number:
  US10/692,067
• Publication Number:
  US 20040167840A1
• Time in Patent Office: 3,772 Days
• Field of Search: None
• US Class Current: 705/35
• 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
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

Disclosed herein in a preferred embodiment is an automated financial instrument brokerage system wherein a front end layer interacts with customers to generate activity requests for an intermediate layer. The intermediate layer preferably processes the activity requests and places financial instrument orders on a financial market if appropriate. A backend layer preferably provides data to the intermediate layer for processing activity requests. Multiple heterogeneous front end customer applications may be supported by the same intermediate layer. Further, multiple backend layer applications may interact with the intermediate layer in a manner transparent to the front end layer. Further, scalability can be achieved be partitioning various tasks of the intermediate layer onto separate servers, and more preferably on-separate redundant servers. Load balancers may then be used in the intermediate layer to provide distributed access to these servers. Also disclosed herein is a caching technique whereby turnaround time for processing activity requests can be reduced by reducing the number of times that the intermediate layer needs to interact with the backend layer.

Claims

1. An automated brokerage system for processing activity requests related to financial instruments, the system comprising:

a front end layer comprising at least one front end server, the at least one front end server configured to execute a plurality of applications, the plurality of applications configured to generate activity requests related to one or more financial instruments in response to input from remote users;

an intermediate layer in communication with the front end layer, the intermediate layer comprising a plurality of intermediate layer servers for simultaneously processing the generated activity requests, the intermediate layer servers being configured to provide a plurality of services in connection with the processing of the activity requests;

a back end layer in communication with the intermediate layer, the back end layer comprising a data source configured to provide financial instrument quote data, a data repository configured to store customer account data, and an order placement system configured to place one or more orders on a financial instrument trading market, the one or more orders being derived from at least one received activity request;

wherein the at least one front end server is further configured to distribute activity requests to the plurality of intermediate layer servers based on activity request type;

wherein the intermediate layer servers are configured to interact with the back end layer data source, the back end layer data repository, and the back end layer order placement system as necessary to process the received activity requests;

wherein the intermediate layer servers comprise a plurality of dedicated servers, the dedicated servers comprising;

a plurality of order servers, each order server configured to receive and process order activity requests from the front end layer;

a plurality of customer account servers, each customer account server configured to receive and process customer account activity requests from the front end layer, wherein the processing of customer account activity requests includes interacting with the back end layer data repository to retrieve customer account data therefrom and providing the retrieved customer account data to the front end applications for display to the users; and

a plurality of quote servers, each quote server configured to receive and process quote activity requests from the front end layer, wherein the processing of quote activity requests includes interacting with the back end layer data source to retrieve the financial instrument quote data therefrom and providing the retrieved financial instrument quote data to the front layer applications for display to the users; and

wherein the intermediate layer further comprises;

a first load balancer that interfaces the front end applications with the plurality of order servers, the first load balancer being configured to distribute order activity requests among the plurality of order servers;

a second load balancer that interfaces the front end applications with the plurality of customer account servers, the second load balancer being configured to distribute customer account activity requests among the plurality of customer account servers; and

a third load balancer that interfaces the front end applications with the plurality of quote servers, the third load balancer being configured to distribute quote activity requests among the plurality of quote servers;

wherein the order servers are configured to directly communicate with the customer account servers via the first load balancer and the second load balancer;

wherein the order servers are configured to directly communicate with the quote servers via the first load balancer and the third load balancer;

wherein the customer account servers are configured to directly communicate with the order servers via the second load balancer and the first load balancer;

wherein the customer account servers are configured to directly communicate with the quote servers via the second load balancer and the third load balancer;

wherein the quote servers are configured to directly communicate with the order servers via the third load balancer and the first load balancer; and

wherein the quote servers are configured to directly communicate with the customer account servers via the third load balancer and the second load balancer.

2. The system of claim 1 wherein the order server is further configured to interact with the customer account server via the first and second load balancers to obtain customer account data therefrom.

3. The system of claim 1 wherein the order server is further configured to interact with the quote server via the first and third load balancers to obtain financial instrument quote data therefrom.

4. The system of claim 1 wherein the intermediate layer further comprises a database schema configured to store data related to received activity requests.

5. The system of claim 4 wherein the database schema comprises:

at least one customers database for storing customer-specific data; and

at least one orders database for storing order-specific data.

6. The system of claim 5 wherein the database schema further comprises at least one trading administration database for storing administrative restrictions related to activity requests.

7. The system of claim 6 wherein the database schema further comprises a plurality of the customers databases, a plurality of the orders databases, and a plurality of the trading administration databases.

8. The system of claim 6 further comprising an administrator interface for controlling the content of the trading administration database.

9. The system of claim 8 wherein the administrator interface is configured to provide an administrator with control over restrictions on at least one of the group consisting of a financial instrument-specific basis, a trading market-specific basis, and an option-specific basis.

10. The system of claim 7 wherein the customer account server includes memory resident thereon for storing customer account data that has previously been retrieved from the back end data repository, and wherein the customer account server is further configured to utilize the customer account data that has been stored in the resident memory according to a predetermined criteria when processing customer account activity requests.

11. The system of claim 10 wherein the resident memory is application-in-memory cache.

12. The system of claim 1 wherein the customer account server includes memory resident thereon for storing customer account data that has previously been retrieved from the back end data repository, and wherein the customer account server is further configured to utilize the customer account data that has been stored in the resident memory according to a predetermined criteria when processing customer account activity requests.

13. The system of claim 12 wherein the resident memory is application-in-memory cache.

14. The system of claim 1 wherein the front end layer and the intermediate layer communicate with each other according to the Internet Protocol Suite (TCP/IP) protocol.

15. The system of claim 14 wherein the intermediate layer servers communicate with each other according to the TCP/IP protocol.

16. The system of claim 1 wherein a plurality of the front end applications are heterogeneous applications configured to communicate with the intermediate layer through a plurality of common component object model (COM) objects.

17. The system of claim 16 wherein the front end layer COM objects include a COM object for communicating order activity requests to the order server.

18. The system of claim 17 wherein the intermediate layer further comprises at least one trading administration database for storing administrative restrictions related to activity requests, and wherein the front end layer COM objects further include a COM object for validating an order activity request against restrictions stored in the trading administration database prior to forwarding that order activity request to the order server.

19. The system of claim 16 wherein the front end layer COM objects further include a COM object for communicating customer account activity requests to the customer account server.

20. The system of claim 16 wherein the front end layer COM objects further include a COM object for communicating quote activity requests to the quote server.

21. The system of claim 1 wherein the back end data source comprises at least one quote feed, the at least one quote feed providing quote data in a data format to the quote server, and wherein the quote server is further configured to convert the received quote data to an internal data format upon receipt thereof.

22. The system of claim 21 wherein the back end data source comprises a plurality of quote feeds, at least two of the quote feeds providing quote data in different data formats, and wherein the quote server is further configured to convert quote data received from each of the quote feeds to the internal data format upon receipt thereof.

23. The system of claim 22 wherein the quote data comprises a plurality of quote data types, and wherein the system further comprises an administrator interface configured to select, in response to administrator input, which of a plurality of quote feeds are to be used for receiving each of the plurality of quote data types.

24. The system of claim 1 wherein the back end layer further comprises a plurality of the data repositories, and wherein the intermediate layer servers are configured to interact with both of the back end data repositories when processing activity requests.

25. The system of claim 1 further comprising an approval desk interface configured to provide a person with control over whether to approve or reject order activity requests routed thereto, and wherein the order server is further configured to determine whether an activity request is to be routed to the approval desk.

38. The system of claim 1 wherein the customer account servers comprises a plurality of web-to-back office (WBO) servers that actas a gateway between the back end layer of the system and a customer using a website provided by the front end layer.

39. The system of claim 11 wherein each customer account server is further configured to (1) check the application-in-memory cache for fresh customer account data when processing an activity request before accessing the back end data repository for such customer account data, (2) use the fresh customer account data to process that activity request if the fresh customer account data is present in the application-in-memory cache, and (3) access the back end data repository for such customer account data if fresh customer account data is not present in the application-in-memory cache.

26. An automated brokerage system, the system comprising:

a plurality of applications configured to generate activity requests related to one or more financial instruments in response to input from remote users, the activity requests comprising any of the group consisting of order activity requests, customer account activity requests, and quote activity requests;

at least one order server configured to process the order activity requests;

at least one customer account server configured to process the customer account activity requests;

at least one quote server configured to process the quote activity requests;

at least one quote data source in communication with the at least one quote server, the quote data source being configured to provide financial instrument quote data to the quote server;

at least one data repository in communication with the at least one customer account server and the at least one order server, the data repository being configured to store customer account data and provide stored customer account data to the customer account server;

at least one order placement system in communication with the order server, the order placement system being configured to place one or more orders received from the order server on a financial instrument trading market, the one or more orders being derived from at least one order activity request; and

a plurality of load balancers in communication with the at least one order server, the at least one customer account server and the at least one quote server;

wherein the at least one order server, the at least one customer account server and the at least one quote server are configured to directly communicate with each other via the load balancers.

27. The system of claim 26 further comprising:

a plurality of the order servers;

a plurality of the customer account servers;

a plurality of the quote servers;

a first load balancer connected between the applications and the order servers, the first load balancer being configured to distribute order activity requests from the applications among the order servers;

a second load balancer connected between the applications and the customer account servers, the second load balancer being configured to distribute customer account activity requests from the applications among the customer account servers; and

a third load balancer connected between the applications and the quote servers, the third load balancer being configured to distribute quote activity requests from the applications among the quote servers;

wherein the order servers and the customer account servers are configured to directly communicate with each other via the first and second load balancers;

wherein the order servers and the quote servers are configured to directly communicate with each other via the first and third load balancers; and

wherein the customer account servers and the quote servers are configured to directly communicate with each other via the second and third load balancers.

28. The system of claim 27 wherein the order servers are further configured to, when processing order activity requests, generate customer account activity requests for communication to the customer account servers directly via the first and second load balancers, and wherein the customer account servers are further configured to provide customer account data that has been obtained in response to the customer account activity requests received from the order servers to the order servers directly via the second and first load balancers.

29. The system of claim 27 wherein the order servers are is further configured to, when processing order activity requests, generate quote activity requests for communication to the quote servers directly via the first and third load balancers, and wherein the quote servers are further configured to provide quote data that has been obtained in response to the quote activity requests received from the order server to the order servers directly via the third and first load balancers.

30. A method for processing activity requests related to financial instruments, the method comprising:

providing a first layer and a second layer in an automated financial instrument brokerage system, the first layer for interacting with users to generate activity requests, wherein the second layer is in communication with the first layer, and wherein the second layer is configured to process activity requests;

providing, in the first layer, a plurality of heterogeneous applications that are configured to generate activity requests related to financial instruments in response to user input;

providing, in the second layer, a plurality of de-centralized order servers, customer account servers and quote servers for processing activity requests, wherein the de-centralized order servers, customer account servers and quote servers are configured to directly communicate activity requests between each other for processing thereby via a plurality of associated load balancers;

providing a common interface for each of the heterogeneous applications to communicate the activity requests to the second layer;

routing generated activity requests through the common interface from the first layer to an appropriate one of the de-centralized order servers, customer account servers and quote servers based on a type for the generated activity request; and

processing activity requests in the second layer with the de-centralized order servers, customer account servers and quote servers independently of the application from which those activity requests originated.

31. The method of claim 30 wherein the common interface providing step comprises:

providing a component object model (COM) interface for each of the heterogeneous applications to communicate activity requests to the second layer.

32. The method of claim 31 wherein the COM interface includes a COM object for communicating order activity requests to the second layer.

33. The method of claim 31 wherein the COM interface includes a COM object for communicating customer account activity requests to the second layer.

34. The method of claim 31 wherein the COM interface includes a COM object for communicating quote activity requests to the second layer.

35. The method of claim 30 wherein the plurality of heterogeneous applications comprises at least two selected from the group consisting of:

a web site, a telephone, a touchtone telephone, a voice recognition application, a cell phone, a pager, a personal digital assistant, a computer, a Windows trading application server, and a Java trading application server.

36. The method of claim 30 wherein the plurality of heterogeneous applications comprises at least three selected from the group consisting of:

a web site, a telephone, a touchtone telephone, a voice recognition application, a cell phone, a pager, a personal digital assistant, a computer, a Windows trading application server, and a Java trading application server.

37. The method of claim 30 wherein the plurality of heterogeneous applications comprises a web site, a cell phone, a personal digital assistant, a computer, a Windows trading application server, and a Java trading application server.

40. The method of claim 30 wherein the activity request processing step comprises interacting with a data repository and data source that are in communication with the second layer.