System and method for managing trading orders received from market makers

An apparatus comprising:

• a processor on an electronic exchange;
• and
• a memory, in which the memory stores instructions which, when executed by the processor, direct the processor to:
• receive, from a first market maker, a first order for a financial instrument, in which the first market maker is located on a device that is remote to the electronic exchange;
• after a delay, receiving, from a second market maker, a second order that matches the first order, in which the delay is due to a latency within the electronic exchange, in which the second market maker is located on a device that is remote to the exchange;
• in response to receiving the second order that matches the first order, automatically adjust a price of the first order based on a set of rules, in which the set of rules is determined in advance of the electronic exchange receiving any orders,
• in which the first market maker and the second market maker are in electronic communication with the processor over a network.

An article of manufacture comprising:

• a computer-readable medium, in which the computer-readable medium is non-transitory and stores instructions which, when executed by a processor, direct the processor to:
• receive, from a first market maker, a first order for a financial instrument, in which the first market maker is located on a device that is remote to the electronic exchange;
• after a delay, receiving, from a second market maker, a second order that matches the first order, in which the delay is due to a latency within the electronic exchange, in which the second market maker is located on a device that is remote to the exchange;
• in response to receiving the second order that matches the first order, automatically adjust a price of the first order based on a set of rules, in which the set of rules is determined in advance of the electronic exchange receiving any orders,
• in which the first market maker and the second market maker are in electronic communication with the processor over a network.