Method and apparatus for stock and index option price improvement, participation, and internalization
AssigneeStc PLC
InventorAnthony J. Saliba
Life of this patent
Estimating the term…
Abstract
A method for stock and index option trading includes the steps of receiving an option order copy from an order flow provider. The option order is contemporaneously submitted to a market. The option order identifies, as examples, contract elements including a contract identifier, underlying security, strike price, expiry, and option quantity. The method then determines a potential cross quantity and price based on the option order. Subsequently, the method submits a contra-order (with respect to the originally received option order) specifying contract elements including the contract identifier, underlying security, strike price, and expiry, as well as the potential cross quantity and price to the market for fulfillment.
Claims23
A method for stock option trading comprising:
- receiving an option order at a market;
- contemporaneously receiving a copy of the option order at an electronic drop (EDrop) system, which is separate and distinct from the market;
- identifying contract elements in the option order including a contract identifier, underlying security, strike price, and expiry;
- obtaining a potential cross quantity and a potential cross price based on the option order at the EDrop system;
- and
- submitting, through the EDrop system, a contra-order, with respect to the option order, to the market, wherein the contra-order specifies contract elements including the contract identifier, expiry, underlying security potential cross quantity, and the potential cross price to the market for fulfillment.
An electronic drop server for stock option trading, the drop server comprising:
- a processing circuit;
- an order flow network connection coupled to the processing circuit;
- an contra-order network connection coupled to the processing circuit;
- and
- a memory coupled to the processing circuit, the memory storing for execution by the processing circuit:
- instructions for receiving an option order copy over the order flow network connection, the option order contemporaneously submitted to a market;
- instructions for identifying in the option order contract elements including a contract identifier, underlying security, strike price, and expiry;
- instructions for obtaining a potential cross quantity and a potential cross price based on the option order;
- and
- instructions for submitting a contra-order, with respect to the option order, over the contra-order network connection to the market for fulfillment, the contra-order specifying contract elements including the contract identifier, expiry, underlying security potential cross quantity, and the potential cross price.
A computer program product for stock option trading, the product comprising:
- a storage medium readable by a processing circuit and storing for execution by the processing circuit:
- instructions for submitting a copy of an option order by an order flow provider over an order flow network connection to an EDrop system, the option order contemporaneously submitted to a market;
- instructions for identifying, in the option order, contract elements including a contract identifier, underlying security, strike price, and expiry;
- instructions for obtaining a potential cross quantity and a potential cross price based on the option order;
- and
- instructions for submitting a contra-order, with respect to the option order, from the EDrop server over a contra-order network connection to the market for fulfillment, the contra-order specifying contract elements including the contract identifier, expiry, underlying security potential cross quantity, and the potential cross price.
Dependencies are inferred from the claim text.