Method and system for managing requests for proposals for electronic trading of financial instruments
View Patent ↗A method and system for electronically trading financial instruments is disclosed. In one embodiment of the disclosed invention, traders generate requests for proposals (“RFPs”) on financial instruments. The RFPs are broadcast to traders whose tradeable structures include the RFP structure. During a response phase, traders may respond to the RFP. These responses are preferably broadcast to all traders who have responded, as well as the requestor. Preferably, only the requestor may trade on the responses during the response phase. Once the response phase expires, the system preferably enters an action phase during which all responders to the RFP and the requestor may trade on the responses. Once the action phase expires, the responses are migrated to the general market.
1. A method of using a computer system to electronically trade financial instruments among a plurality of traders, including a requestor and two or more responders, comprising:
receiving at said computer system a request for proposal (“RFP”) on a financial instrument from said requester, said requester associated with a requestor workstation, said RFP comprises a two-way structure which allows for both offers and bids but not comprising an offer to trade that can be hit or lifted and;
receiving at said computer system two or more responses to said RFP, each said responder associated with a responder workstation, each said responder workstation providing at least one said response;
said computer system transmitting said responses to said requestor workstation;
said computer system allowing said requestor to trade on said responses during a first period, each trader of said plurality of traders not being allowed to trade on said responses during said first period unless said trader comprises said requestor; and
at the expiration of said first period, said computer system allowing said responders to trade on said responses during a second period, each trader of said plurality of traders not being allowed to trade on said responses during said second period unless said trader comprises said requestor or said responders.
2. The method of claim 1 further comprising said computer system matching orders at the expiration of said first period and before allowing said responders to trade on said responses.
3. The method of claim 2 wherein said orders are associated with a bid price or an offer price, said matching orders process further comprising said computer system matching crossed orders in which the highest bid price is higher than the lowest offer price.
4. The method of claim 1 wherein any responses which have not been traded on at the end of said second period are migrated by said computer system to a general market.
5. The method of claim 1 , wherein said requestor and said responders are associated with trading groups, said method further comprising said computer system transmitting said responses to said trading group associated with said requestor and each trading group associated with said responders, each trader of said plurality of traders not receiving said responses unless said trader comprises a trader in said trading group associated with said requestor or at least one trading group associated with said responders.
6. The method of claim 5 further comprising said computer system allowing traders in said trading group associated with said requestor to trade on said responses during said first period, each trader of said plurality of traders not being allowed by said computer system to trade on said responses during said first period unless said trader comprises a trader in said trading group associated with said requestor.
7. The method of claim 6 further comprising said computer system allowing traders in each said trading group associated with said responders to trade on said responses during said second period.
8. A method of using a computer to electronically trade financial instruments among a plurality of traders, including a requestor and two or more responders, each trader of said plurality of traders being associated with one or more trading groups, said method comprising:
receiving at said computer system a request for proposal (“RFP”) on a financial instrument from a requestor associated with a requestor workstation, said RFP comprising a two-way structure which allows for both offers and bids but not comprising an offer to trade that can be hit or lifted;
during a first response period, receiving at said computer system two or more responses to said RFP from said responders, each responder associated with a responder workstation, each said responder providing at least one said response;
said computer system transmitting said responses to said requestor;
said computer system allowing said requestor to trade on said responses during a first exclusivity period, each trader of said plurality of traders not being allowed to trade on said two or more responses during said first exclusivity period unless each said trader is associated with one or more trading groups associated with said requestor, said first response period and said first exclusivity period being allowed to overlap; and
at the expiration of said first exclusivity period, said computer system allowing said responders to trade on said responses during a second exclusivity period, each trader of said plurality of traders not being allowed to trade on said responses during said second exclusivity period unless each such trader is associated with one or more trading groups associated with said requestor or is associated with one or more trading groups associated with said responders.
9. The method of claim 8 wherein each trader of said plurality of traders is associated with one or more tradeable structures stored in said computer system, said tradeable structures for each said trader being a function of potential traders to a trade.
10. The method of claim 8 wherein said first exclusivity period and said second exclusivity period are co-terminus.
11. The method of claim 8 further comprising said computer system migrating said responses to a general market at the expiration of said second exclusive period.
12. A system for electronically trading financial instruments among a plurality of traders, including a requestor and two or more responders, comprising:
a first workstation associated with a requestor, said first workstation adapted to accept requests for proposal (“RFP”) from said requestor, said RFP comprising a two-way structure which allows for both offers and bids but not comprising an offer to trade that can be hit or lifted;
a plurality of responder workstations each associated with a responder, each said responder workstation adapted to accept responses to said RFPs from at least one said responder;
a server coupled to said first workstation and each said responder workstation, said server adapted to:
receive said RFP from said first workstation;
receive two or more responses from two or more responder workstations;
transmit said responses to RFP to said first workstation and each of said plurality of responder workstations from which said server received a response, each workstation of said plurality of responder workstations not displaying said two or more responses to RFP unless said responder workstation sent a response to said RFP;
allow said requestor to trade on said responses to RFP during a first period, each trader of said plurality of traders not being allowed to trade on said response during said first period unless each said trader comprises said requestor; and
at the end of said first period, allow said responders to trade on said responses during a second period, each trader of said plurality of traders not being allowed to trade on said responses during said second period unless each said trader comprises said requestor or said responders.
13. The system of claim 12 wherein certain of said first workstation and said plurality of responder workstations functions are implemented in said server.
14. A system for electronically trading financial instruments among a plurality of traders, comprising a server adapted to:
receive a request for proposal (“RFP”) on a financial instrument from a requestor, said RFP comprising a two-way structure which allows for both offers and bids but not comprising an offer to trade that can be hit or lifted;
receive two or more responses to said RFP from two or more responders, each said responder providing at least one said response;
transmit said two or more responses to said requestor and said two or more responders, each trader of said plurality of traders not receiving said two or more responses unless each said trader comprises said requestor or one or more responders;
allow said requestor to trade on said responses during a first period, each trader of said plurality of traders not being allowed to trade on said response during said first period unless each said trader comprises said requestor; and
allow said two or more responders to trade on said responses during said second period at the expiration of said first period, each trader of said plurality of traders not being allowed to trade on said response during said second period unless each said trader comprises said requestor or said two or more responders.
15. A method of using a computer system to electronically trade financial instruments among a plurality of traders, comprising:
receiving at said computer system a request for proposal (“RFP”) on a financial instrument from a requestor, said RFP comprising a two-way structure which allows for both offers and bids but not comprising an offer to trade that can be hit or lifted;
receiving at said computer system two or more responses to said RFP from two or more responders, each said responder providing at least one said response;
said computer system transmitting said two or more responses to said requestor;
said computer system allowing said requestor to trade on said two or more responses during a first period, each said trader of said plurality of traders not being allowed to trade on said two or more responses during said first period unless said trader comprises said requestor; and
at the expiration of said first period, said computer system allowing said two or more responders to trade on said two or more responses during a second period, each said trader of said plurality of traders not being allowed to trade on said two or more responses during said second period unless said trader comprises said requestor or said two or more responders.