US 7,606,759 B2Granted

System and method for implementing an anonymous trading method

AssigneeAutomated Trading Desk, LLC

InventorsSteve Swanson, Julian Greim, Nicholas Stech

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Abstract

A system and appertaining method are provided in which a brokerage firm transmits confidential information about security trading intentions to an anonymous server that follows through on a trade only if there is a likelihood that the trade can be completed. Pricing inputs are obtained that help a price engine determine pricing information for securities. The trade itself is executed by a primary trading system. If the trade is not completed, then the confidential information is not shared with a market maker or other purchasing or selling entity. When security is low and trust is high, for speed purposes, among other things, the anonymous server may be located with a market maker. When security is high and trust is low, any or all of the anonymous server, price engine, and primary trading system can be collocated on site with the broker in a secure environment.

Claims17

Dependent claims

A method for facilitating automated securities trading comprising the steps of:

anonymously communicating, by a system of a second party, to an anonymous server of a first party the second party's price and quantity of a security for which the second party is interested in trading;
receiving, by the anonymous server, market data from a pricing input;
generating, by the anonymous server, a predetermined range of a price and a quantity, based on the received market data, at which the first party is willing to trade the security;
comparing, by the anonymous server, the second party's price and quantity with the predetermined range of the price and quantity generated by the anonymous server;
when the second party's price and quantity is within the predetermined range of the price and quantity generated by the anonymous server, then converting, by the anonymous server, the second party's price and quantity into an order for the security, and informing, by the anonymous server, the second party's system of conversion of its price and quantity to the order for the security;
receiving, by the anonymous server, from the second party's system a selection of an option of the second party for communicating the order to a primary trading system and based upon the option selected:
1) directly communicating, by the anonymous server, the order to the primary trading system of the first party for execution, or
2) waiting for the second party's system to communicate the order to the primary trading system of the first party;
and
executing the order by the primary trading system of the first party according to the second party's option when the order is within the predetermined range established by the first party.

7 more elements

Dependencies are inferred from the claim text.

Facts

Application: 11/434,942Filed 16 May 2006
Published: US 2007/0271169 A122 Nov 2007
Granted: 20 Oct 2009
Term ends: Not estimatedThe source records don’t support an estimate.

Classification4 codes

G06Q 40/04
Finance; Insurance; Tax strategies; Processing of corporate or income taxes: trading; Exchange, e.g. stocks, commodities, derivatives or currency…
G06Q 40/00
Finance
G06Q 40/06
Finance; Insurance; Tax strategies; Processing of corporate or income taxes: asset management; Financial planning or analysis
G06Q
Information and communication technology [ict] specially adapted for administrative, commercial, financial, managerial