# US 2013/0159210 A1 · Corporate debt options exchange

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- Number: US 2013/0159210 A1
- Document ID: US20130159210A1
- Status: Published application
- Kind: A1
- Application number: 13/326,504
- Filed: 2011-12-15
- Published: 2013-06-20
- Earliest claimed: 2011-12-15
- Assignees: The NASDAQ OMX Group, Inc.
- Inventors: Daniel R. CARRIGAN
- Web page: https://patentgrep.com/patent/US20130159210A1

## CPC

- G06Q 40/04: Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
- G06Q: INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR

## Abstract

A method, apparatus, and system are provided for matching orders for corporate debt options in a corporate debt options exchange. A corporate debt options exchange receives an order for a corporate debt option, determines one or more conditions for purchase/sale on the order for the corporate debt option, and matches the order for the corporate debt option with a stored order in an order book in the corporate debt options exchange based on the one or more determined conditions. The order is stored in the order book when no match for the order is found.

## Claims

### Claim 1

An order processing method for matching orders for corporate debt options in an electronic corporate debt options exchange, the corporate debt options exchange having one or more processors, the method comprising:
receiving, by a communications interface of the corporate debt options exchange, an order message for a Trade Reporting And Compliance Engine (TRACE) eligible corporate debt option;
determining, by a processor of the corporate debt options exchange, one or more conditions for purchase/sale on an order comprised in said order message for the TRACE-eligible corporate debt option;
determining, by the processor of the corporate debt options exchange, if the order for the TRACE-eligible corporate debt option matches with a stored order in an electronic order book in the corporate debt options exchange based on the one or more determined conditions;
storing, by a non-volatile memory, an electronic copy of the order in the electronic order book if no match for the order is found; and
issuing, by the communications interface of the corporate debt options exchange, an electronic TRACE report message for subsequent dissemination to an Options Price Reporting Authority,
wherein the TRACE-eligible corporate debt option is an option on a TRACE-eligible corporate debt security, the option allowing the TRACE-eligible corporate debt security to be traded at a predetermined price on or before a predetermined expiration date.

### Claim 2 (depends on 1)

The order processing method of claim 1, wherein the corporate debt options exchange is a centralized, automated electronic exchange in a corporate debt options exchange system.

### Claim 3 (depends on 1)

The order processing method of claim 1, wherein the one or more conditions for the order for the corporate debt option comprises:
selecting, by the processor of the corporate debt options exchange, an amount of the TRACE-eligible corporate debt options to purchase/sell;
selecting, by the processor of the corporate debt options exchange, a price to purchase/sell the option on the TRACE-eligible corporate debt security;
selecting, by the processor of the corporate debt options exchange, an expiration date for the TRACE-eligible corporate debt option;
selecting, by the processor of the corporate debt options exchange, a put option for the TRACE-eligible corporate debt option;
selecting, by the processor of the corporate debt options exchange, a call option for the TRACE-eligible corporate debt option; and
selecting, by the processor of the corporate debt options exchange, a combination of two or more put or call combinations.

### Claim 4 (depends on 3)

The order processing method of claim 3, wherein the order is a quote for a TRACE-eligible corporate debt option.

### Claim 5 (depends on 3)

The order processing method of claim 3, wherein selecting the put option allows a buyer of the option on the TRACE-eligible corporate debt security to require a seller of the option to buy the TRACE-eligible corporate debt security if exercised after the expiration date.

### Claim 6 (depends on 3)

The order processing method of claim 3, wherein selecting the call option allows a buyer of the option on the TRACE-eligible corporate debt security to require a seller of the option to sell the TRACE-eligible corporate debt security if exercised after the expiration date.

### Claim 7 (depends on 3)

The order processing method of claim 3, wherein the TRACE-eligible corporate debt option is an option on a corporate bond.

### Claim 8 (depends on 3)

The order processing method of claim 3, wherein the TRACE-eligible corporate debt option is an option on a corporate note.

### Claim 9

A non-transitory computer-readable storage medium having computer readable code embodied therein and capable of being stored in a memory as computer program instructions, which when executed by a computer having one or more processors, performs functionality comprising:
receiving an order for a TRACE-eligible corporate debt option determining one or more conditions for purchase/sale on the order for the TRACE-eligible corporate debt option;
determining if the order for the TRACE-eligible corporate debt option matches with a stored order in an order book in the corporate debt options exchange based on the one or more determined conditions; and
storing the order in the order book if no match for the order is found, wherein the TRACE-eligible corporate debt option is an option on a TRACE-eligible corporate debt security, the option allowing the TRACE-eligible corporate debt security to be traded at a predetermined price on or before a predetermined expiration date.

### Claim 10

A corporate debt option exchange apparatus, comprising:
a memory configured to store orders for TRACE-eligible corporate debt options in an order book; and
one or more processors, coupled to the memory, configured to match orders for TRACE-eligible corporate debt options in the corporate debt options exchange apparatus and configured to:
receive an order for a TRACE-eligible corporate debt option;
determine one or more conditions for purchase/sale on the order for the TRACE-eligible corporate debt option;
determine if the order for the TRACE-eligible corporate debt option matches with a stored order in the order book in the corporate debt exchange apparatus based on the one or more determined conditions; and
store the order in the order book if no match for the order is found,
wherein the TRACE-eligible corporate debt option is an option on a TRACE-eligible corporate debt security, the option allowing the TRACE-eligible corporate debt security to be purchased/sold at a predetermined price on or before a predetermined expiration date.

### Claim 11 (depends on 10)

The corporate debt option exchange apparatus of claim 10, wherein the corporate debt options exchange apparatus is a centralized, automated electronic exchange in a corporate debt options exchange system.

### Claim 12 (depends on 10)

The corporate debt option exchange apparatus of claim 10, wherein the one or more conditions for the order for the TRACE-eligible corporate debt option comprises:
selecting an amount of TRACE-eligible corporate debt options to purchase/sell;
selecting a price to purchase/sell the option on the TRACE-eligible corporate debt security;
selecting an expiration date for the TRACE-eligible corporate debt option;
selecting a put option for the TRACE-eligible corporate debt option;
selecting a call option for the TRACE-eligible corporate debt option; and
selecting a combination of two or more put and/or call combinations.

### Claim 13 (depends on 12)

The corporate debt option exchange apparatus of claim 12, wherein the order is a quote for a TRACE-eligible corporate debt option.

### Claim 14 (depends on 12)

The corporate debt option exchange apparatus of claim 12, wherein selecting the put option allows a buyer of the option on the TRACE-eligible corporate debt security to require a seller of the option to buy the TRACE-eligible corporate debt security if exercised after the expiration date.

### Claim 15 (depends on 12)

The corporate debt option exchange apparatus of claim 12, wherein selecting the call option allows a buyer of the option on the TRACE-eligible corporate debt security to require a seller of the option to sell the TRACE-eligible corporate debt security if exercised after the expiration date.

### Claim 16

A corporate debt option exchange system, comprising:
a broker apparatus having:
one or more processors configured to create orders;
a memory, coupled to the one or more processors, configured to store the created orders, and
a first data transceiver device for transmitting the created orders; and
a corporate debt option exchange apparatus having:
a memory configured to store orders for TRACE-eligible corporate debt options in an order book,
a second data transceiver device for receiving the created orders, and
one or more processors, coupled to the memory, configured to match orders for TRACE-eligible corporate debt options in the corporate debt option exchange apparatus and configured to:
receive an order for a TRACE-eligible corporate debt option;
determine one or more conditions for purchase/sale on the order for the TRACE-eligible corporate debt option;
determine if the order for the TRACE-eligible corporate debt option matches with a stored order in the order book in the corporate debt exchange apparatus based on the one or more determined conditions; and
store the order in the order book if no match for the order is found,
wherein the TRACE-eligible corporate debt option is an option on a TRACE-eligible corporate debt security, the option allowing the TRACE-eligible corporate debt security to be purchased/sold at a predetermined price on or before a predetermined expiration date.

### Claim 17 (depends on 16)

The corporate debt option exchange system of claim 16, wherein the corporate debt options exchange apparatus is a centralized, automated electronic exchange in the corporate debt options exchange system.

### Claim 18 (depends on 16)

The corporate debt option exchange system of claim 16, wherein the one or more conditions for the order for the TRACE-eligible corporate debt option comprises:
selecting an amount of TRACE-eligible corporate debt options to purchase/sell;
selecting a price to purchase/sell the option on the TRACE-eligible corporate debt security;
selecting an expiration date for the TRACE-eligible corporate debt option;
selecting a put option for the TRACE-eligible corporate debt option;
selecting a call option for the TRACE-eligible corporate debt option; and
selecting a combination of two or more put and/or call combinations

### Claim 19 (depends on 18)

The corporate debt option exchange system of claim 18, wherein the order is a quote for a TRACE-eligible corporate debt option.

### Claim 20 (depends on 18)

The corporate debt option exchange system of claim 18, wherein selecting the put option allows a buyer of the option on the TRACE-eligible corporate debt security to require a seller of the option to buy the TRACE-eligible corporate debt security if exercised after the expiration date, and
wherein selecting the call option allows a buyer of the option on TRACE-eligible the corporate debt security to require a seller of the option to sell the TRACE-eligible corporate debt security if exercised after the expiration date.