System and method for real-time options trading over a global computer network

A method for electronically trading options contracts and for hedging the options contracts with underlying contracts, comprising the steps of:

• receiving, at a server, a first order from a first trader for options with a first hedge delta;
• receiving at the server, a second order from the first trader for the underlying contract based on the first hedge delta;
• receiving, at the server, a third order from a second trader for options with a second hedge delta;
• receiving, at the server, a fourth order from the second trader for the underlying contract based on the second hedge delta;
• matching the first order and the second order to execute a trade;
• and
• executing the trade if the first hedge delta is equal to the second hedge delta.

A system for electronically trading options contracts and for hedging the options contracts with underlying contracts, comprising:

• a memory storage for storing machine-readable instructions;
• and
• a processor programmable to execute the machine-readable instructions retrieved from the memory storage for:
• a) receiving a first order from a first trader for options with a first hedge delta;
• b) receiving a second order from the first trader for the underlying contract based on the first hedge delta;
• c) receiving a third order from a second trader for options with a second hedge delta;
• d) receiving a fourth order from a second trader for the underlying contract based on the second hedge delta;
• e) matching the first order and the third order to execute a trade;
• and
• f) executing the trade if the first hedge delta is equal to the second hedge delta.