EP2150935A1 - Procédé et système d'administration de courtage - Google Patents

Procédé et système d'administration de courtage

Info

Publication number
EP2150935A1
EP2150935A1 EP08795860A EP08795860A EP2150935A1 EP 2150935 A1 EP2150935 A1 EP 2150935A1 EP 08795860 A EP08795860 A EP 08795860A EP 08795860 A EP08795860 A EP 08795860A EP 2150935 A1 EP2150935 A1 EP 2150935A1
Authority
EP
European Patent Office
Prior art keywords
trade
customer
dealer
prime
prime broker
Prior art date
Legal status (The legal status is an assumption and is not a legal conclusion. Google has not performed a legal analysis and makes no representation as to the accuracy of the status listed.)
Ceased
Application number
EP08795860A
Other languages
German (de)
English (en)
Other versions
EP2150935A4 (fr
Inventor
James Worden Toffey
Thomas Garley
Current Assignee (The listed assignees may be inaccurate. Google has not performed a legal analysis and makes no representation or warranty as to the accuracy of the list.)
Tradeweb Markets LLC
Original Assignee
Tradeweb Markets LLC
Priority date (The priority date is an assumption and is not a legal conclusion. Google has not performed a legal analysis and makes no representation as to the accuracy of the date listed.)
Filing date
Publication date
Application filed by Tradeweb Markets LLC filed Critical Tradeweb Markets LLC
Publication of EP2150935A1 publication Critical patent/EP2150935A1/fr
Publication of EP2150935A4 publication Critical patent/EP2150935A4/fr
Ceased legal-status Critical Current

Links

Classifications

    • G—PHYSICS
    • G06—COMPUTING; CALCULATING OR COUNTING
    • 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
    • G06Q40/00—Finance; Insurance; Tax strategies; Processing of corporate or income taxes
    • G06Q40/04—Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Definitions

  • the present invention relates generally to electronic trading methods and systems and, more particularly, to administering prime brokerage through an electronic trading system that provides straight-through processing and the intercommunication therethrough.
  • a customer desiring to buy or sell a fixed income instrument first would make an inquiry, or a request for a quote, to a dealer that is willing to buy and sell such fixed income instrument.
  • the customer may be any person or entity desiring to trade but generally refers to buy-side institutions, such as investment funds, institutional investors, money market funds, and mortgage brokers to name a few.
  • the dealer generally is any person or entity that is registered with the Securities and Exchange Commission (SEC) or an equivalent non-U.S. regulator to deal (i.e., to make a market for) financial instruments for its own account (at its bid price) or sell from its own account (at its ask or offer price).
  • SEC Securities and Exchange Commission
  • an equivalent non-U.S. regulator to deal (i.e., to make a market for) financial instruments for its own account (at its bid price) or sell from its own account (at its ask or offer price).
  • a customer would make an inquiry, for example, via the telephone or facsimile transmission. Frequently, the customer would make an inquiry to several dealers with which the customer has a relationship before identifying a dealer willing to trade in the desired instrument. Because the manual process required the customer to telephone each of the dealers individually, the process of requesting price quotes could take several minutes during which time the market may have moved against the customer. Once the customer identified an acceptable dealer the customer and dealer would verbally agree to the negotiated price for the desired fixed income instrument and execute the trade. [006] Upon verbal agreement, both the customer and dealer would manually write the trade details on a trade ticket.
  • a trade ticket typically comprised several layers of carbon paper, such that at least one layer could be passed to the back office personnel responsible for confirming trades. These processes are prone to error due to the manual nature of the recordation process. In this case, the trade details may be electronically transmitted to back office systems operated by personnel responsible for confirming trades.
  • Rule 10b- 10 under the Securities Exchange Act of 1934 (“Rule lOb-10") and equivalent non-U.S. rules relating to confirmation and clearance of trades require that a dealer provide certain written disclosures to a customer immediately after the completion of a transaction to confirm the trade. In order to create the Rule 10b- 10 confirmation, the dealer would manually extract the details of the trade, such as those passed on the trade ticket, and create a paper confirmation — an inefficient process prone to potential human error.
  • allocation the customer, if trading on behalf of several client accounts, would have to transmit allocation instructions to the dealer regarding the financial instruments being bought or sold to any of the number of different sub-accounts. More specifically, a customer entering into a large block trade on behalf of several accounts would provide allocation instructions to the dealer, for example, via the telephone or via facsimile. Again, this manual process was open to human error, not only in providing and recording the proper instructions, but also in propagating the correct instructions to the other back office personnel responsible for other functions, such as confirmation and settlement.
  • a customer In order to settle allocated trades, a customer would deliver settlement instructions (e.g., Central Securities Depository (CSD) settlement data, including the CSD address, swift codes, ABA number, account number and account name) to a dealer via facsimile or telephone.
  • the dealer would manually input this information into their internal systems to generate the confirmation and to facilitate clearance and settlement of the securities traded.
  • the dealer Following the customer's approval of the information, the dealer would provide the trade details and settlement instructions to the relevant clearing agency to effect settlement of the trade.
  • Similar to the trade execution phase there was no direct link between customers, dealers, and clearing institutions to exchange trade details and settlement instructions during the settlement process. Thus, the manual trading and settlement process was prone to errors and often took several days to complete.
  • efficiencies provided by existing electronic trading systems are typically limited to only a portion of a dealer's or customer's trading volume. Dealers frequently enter into trades via more than one electronic system and over the phone. These electronic systems, while providing increased efficiency for trades conducted on each system, are incompatible with each other and with manual processes, making it impossible to recognize a benefit of one system across all phases of the trading cycle. Indeed, such disparate systems can add to the complexity and inefficiency of management of a customer's or dealer's entire trading volume.
  • Prime broker is a dealer who acts as a "manager" for certain institutional customers. More recently, the use of prime brokers has become popular with hedge funds. A customer that uses a prime broker allows the prime broker to monitor and/or process and settle trades on the customer's behalf.
  • the relationship between the customer and a prime broker is governed by agreement, or as it is known in the art a Prime Broker Agreement and Master Give-Up Agreement between the prime broker and the customer specifying the scope of the prime broker's relationship with the customer, including when the prime broker may step in and execute a trade on the customer's behalf.
  • a customer who wants to execute a trade using its prime broker communicates with a dealer about the terms of a trade, the customer and dealer agree on the details of the trade, and the customer also informs the dealer as to which prime broker the customer wishes to use on the particular trade identified at the block level or at the sub-account level.
  • the customer advises the prime broker of the details of the trade and the prime broker has a certain period of time within which to accept or reject the trade based on the terms of the master give-up agreement it has with its customer.
  • While there has been some automation of certain aspects of the trading process involving prime brokers many problems and inefficiencies still exist in the inclusion of a prime broker in a financial transaction. Therefore, a need exists for a system and method that allows customers, dealers and prime brokers to execute a financial transaction that eliminates the inefficiencies of prior systems and methods involving prime brokers.
  • STP trading platform that provides straight-through processing (STP) of various financial instruments, including, but not limited to, liquid fixed-income instruments utilizing a prime broker.
  • STP trading platform e.g., systems and methods
  • the STP trading platform overcomes the shortcomings of present trading systems and methods for the trading, allocation, confirmation, prime broker interaction and settlement of fixed income instruments.
  • the STP trading platform has the ability to execute trades, dynamically allocate trades according to customer instructions, communicate with a one or more customers, one or more dealers and one or more prime brokers, confirm the trade details and allocations and provide accurate settlement instructions for the trades using a centralized database of standing settlement instructions.
  • the STP trading platform also is capable of generating electronic confirmations to facilitate confirmation and settlement of trades. Further, the STP trading platform is capable of leveraging it unique position as a centralized trading, allocation confirm the trade details and allocations and settlement platform to provide customers and dealers with advanced reporting of various industry and trade data. Additionally, the STP trading platform is also capable of receiving instructions from one or more prime brokers as to whether a trade has been approved and to allow a prime broker to step into a transaction.
  • the STP trading platform permits participants to initiate trade inquires, execute trades, allocate trades to sub-accounts, communicate with one or more prime brokers, confirm the trade details and allocations and electronically confirm trades, so as to eliminate the need to manually input and re- input trade data in multiple systems designed to handle only one aspect of the trading cycle.
  • the described STP trading platform reduces the possibility of trade failures due to inaccuracies in the provisions of settlement instructions between customers and dealers.
  • the standardized and integrated approach of the STP trading platform both streamlines and comprehensively improves the trading process. Due to integration of such functionality, the trading platform also provides an electronic, paperless solution for the entire trading cycle, including trade order generation, trade execution, prime broker administration, trade allocation, allocation and trade detail acknowledgement, electronic trade confirmation, and access to standing settlement instructions to facilitate settlement of trades.
  • the STP trading platform comprises one or more software applications operative on a server system, along with data storage devices and communication devices, to achieve straight-through processing of the entire trading cycle.
  • Dealers, customers and prime brokers have access to computer software that facilitates trade order management, trade order generation, trade execution, trade allocation, allocation and trade details acknowledgement, trade confirmation, and finally enrichment of settlement instructions.
  • the STP trading platform integrates various software modules and communication links to process the originating execution, allocation, acknowledgement of allocation, prime broker administration, and trade details electronic confirmation, and enriching details with settlement instructions of trades.
  • FIG. 1 is a schematic block diagram of an exemplary STP trading platform in communication with various users
  • FIG. 2 depicts an exemplary system architecture of the STP trading platform
  • FIGS. 3 and 4 are flow diagrams depicting an exemplary flow of data between customer and dealer through the STP trading platform
  • FIG 5 is an exemplary database schematic for use with the STP trading platform;
  • FIG. 6 is a screen shot depicting an exemplary graphical user interface of the STP trading platform;
  • FIG. 7 is a flow diagram depicting an exemplary flow of a prime broker transaction using the STP trading platform;
  • FIGS. 8-17 are screen shots depicting exemplary graphical user interfaces of various features of the STP trading platform;
  • FIG. 18 is an exemplary data flow for handling phone trades via the STP trading platform;
  • FIG. 19 is an exemplary data flow for allocating and confirming a block trade using an
  • FIG 20 is a flow diagram depicting an exemplary flow of a multiple prime broker transaction using the STP trading platform.
  • a computerized STP trading platform 100 interconnects the computers of customers 200, custodians 280, such as a bank, agent, trust company or other organization responsible for safeguarding the assets of another person or entity, like a customer, clearing institutions 240, dealers 260 and prime brokers 265 via existing communications network 50, such as the Internet.
  • custodians 280 such as a bank, agent, trust company or other organization responsible for safeguarding the assets of another person or entity, like a customer, clearing institutions 240, dealers 260 and prime brokers 265 via existing communications network 50, such as the Internet.
  • the STP trading platform 100 preferably utilizes a distributed software application arrangement, as will be further described below in the "System Architecture" section of the present application, to provide the straight-through- processing ("STP") of trades.
  • the typical trading cycle begins with traders for customers accessing indicative market pricing feeds, although, as described below, trades can be initiated through an internal order management system.
  • Indicative market pricing feeds or composite price matrices such as those shown and described herein, generally receive near real-time indicative pricing data from dealers.
  • the price data is then input into a software algorithm to generate the composite price screen.
  • the operation of the composite price algorithm is not critical to the present invention and, therefore, specifics of the algorithm are not discussed.
  • the composite price screens are generated by the software algorithm operative of the STP trading platform servers (shown in FIG. 2 as servers 105) and communicated through a network 50 to both the customer and dealer computer systems 200, 260 and, if necessary, to the prime broker computer system 265.
  • a customer- side software client 210 that includes an electronic trading component 215 and a back- office management component 220.
  • the customer-side software client 210 is configured to receive and display the composite price screens and to permit customer traders to create trade inquiries, search dealer offerings, receive dealer axes, execute trades, allocate trades, and perform various other back office functions, as further described below.
  • the customer generally views a composite price screen so as to gather information relating to a particular fixed income instrument. Dealers may also view composite price screens to keep apprised of market trends. As described below, the customer can initiate a trade inquiry from the composite price screens.
  • the STP trading platform 100 operates according to an inquiry-based trading environment.
  • a customer desiring to buy or sell financial instruments makes an electronic inquiry of one or more dealers for prices at which the instruments can be bought or sold. Because multiple dealers may be competing against one another, this type of inquiry is sometimes referred to as competitive auction-based inquiry.
  • the STP trading platform 100 may be configured to operate according to an inventory-based trading environment in which dealers post inventories of various financial instruments from which customers can make purchases.
  • dealers interact with a dealer-side software client 270 operative on the dealer system 260.
  • an electronic trading component 275 of the dealer-side software client 270 permits dealers to receive trade inquiries from customers, create axes, manage the provision of market prices to customers in response to the inquiries through the STP trading platform 100, execute trades, receive customer allocations, confirm trade details and allocation instructions, generate confirmations, and perform other back office tasks.
  • Traders for the selected dealers receive inquiries through the STP trading platform 100 into the electronic trading component 275.
  • the electronic trading component 275 operates to display customer-initiated inquiries on a graphical interface that provides dealers with the ability to input the requested bid/ask prices into an electronic trade ticket and transmit the prices to the customer.
  • Dealers must typically present both bids and offers to customers so that customers can select to trade either side of a transaction. For instance, the dealer must provide bids that represent the price at which the dealer is willing to purchase a particular financial instrument from customers. Similarly, the dealer must post offers (or ask prices), which are the price at which the dealers are willing to sell particular financial instruments to customers.
  • dealers must make the prices they post firm for several seconds and, thus, the dealers will post prices "on the wire” for several seconds. If the customer selects a particular dealer's price while there is "on the wire” time remaining, then the dealer must honor the firm price and the transaction will automatically be accepted. A trade performed after the "on the wire” time has expired may be accepted or rejected at the dealer's sole discretion. Prior to a trade being performed after the "on the wire” time has expired, the dealer may refresh its trade price and reset the "on-the-wire" time.
  • dealers can provide market prices in response to customer inquiries and set specific "on the wire" time periods.
  • a trade ticket interface shown and described below
  • dealers can provide market prices in response to customer inquiries and set specific "on the wire" time periods.
  • an electronic message is created and an identifier is mapped to the dealer price offer so that a record of the offer can be stored in the trade history database 115 of the STP trading platform 100.
  • the live market dealer price and "on the wire" time period is transmitted through the electronic trading module 160 of the STP trading platform 100 to the customer's computer 200 and displayed by the customer-side electronic trading component 215.
  • the customer can see the selected dealers' prices, along with a countdown of "on the wire” time.
  • the customer-side electronic trading component 215 the customer can "hit" a bid or "lift” an offer to initiate the purchase or sale, as applicable, of the selected financial product. This functionality is performed electronically, as described further below.
  • the STP trading platform 100 may also be configured to process trades executed on systems other than through the electronic trading module 160, such as trades executed via telephone or by an alternate electronic trading system. Trade details from alternate systems are electronically imported into the STP trading platform 100 so as to provide the straight-through-processing functionality described herein for trades executed using these alternate methods. Trade data regarding transactions effected on other systems is imported by dealers into the STP trading platform 100 using application programming interfaces (APIs) that link the two systems and through data transfer using standardized (e.g., FIX format) or customized formats, as described further below.
  • APIs application programming interfaces
  • the STP trading platform 100 permits dealers to initiate trade inquiries using the dealer-side electronic trading component 215.
  • Such dealer-generated trade inquiries are referred to as electronic axes.
  • a dealer using axe generation functionality can input the material terms of an offer to trade a particular instrument. Unlike present systems that permit only non-executable messages, the dealer can set an "on the wire" time during which the trade will be accepted by a selected customer or group of customers at the dealer's terms.
  • the dealer can communicate the electronic axe using the STP trading platform 100 to one or more selected customers. If a customer accepts a dealer electronic axe, the trade is executed in the same manner as customer initiated inquiries.
  • the customer may make any necessary account allocations to block trades.
  • the functionality to allocate block trades to the customer's sub-accounts is provided through integration of the electronic trading module 160, along with the customer-side electronic trading component 215, and the account management module 120 and associated account management database 110.
  • the account management module 120 includes, at least in part, an account management database 110 for the storage and maintenance of account and sub-account information for each of the customers' client's accounts.
  • the customer's account information can be retrieved from the account management database 110.
  • a breakdown interface provided by the customer- side electronic trading component 215 is populated by account information retrieved from the account management database 110, which includes at least a sub-account database.
  • the customer is provided functionality to selectively allocate the block trade to one or more sub-accounts.
  • the customer-side electronic trading component 215 of the electronic trading module 160 can generate an allocation ticket for each allocation of the block trade.
  • each allocation is treated for the purposes of allocation acknowledgement, electronic confirmation and settlement as a separate allocation ticket.
  • Each allocation ticket contains an identifier that permits the electronic trading module 160 to store a data record for each allocation ticket in the trade history database 115.
  • the allocation ticket also may contain an identifier linking it to the original block trade executed between the parties.
  • the electronic trading module 160 of the STP trading platform 100 through integration with the account management module 120, also has the functionality to permit the allocation of trades through the use of integrated inter-systems or order management systems of the customer.
  • the STP trading platform can be, and preferably is, communicatively linked to the internal systems of customers and dealers.
  • OMS order management systems
  • Customer software may also electronically handle sub- account allocation in an automated fashion.
  • the STP trading platform 100 enables customers to initiate the trading process using OMS 222, and electronically allocate block trades executed on the STP trading platform 100 using associated software.
  • OMS systems 222 are linked to the STP trading platform 100 using an API, which permits allocation details, for example, to be imported into the STP trading platform 100, so that the allocation details can, in turn, be transmitted through the STP trading platform 100 to the dealer-side computers 260 for acknowledgement.
  • the trade details which may include a summary of the block trade and the account information for the allocation, if applicable, may be enriched through interaction with the account management database of the STP trading platform 100.
  • the account management database 110 stores standing settlement instructions pertaining to each of the customer accounts.
  • the electronic trading module 160 accesses the account management database 115 to retrieve the standing settlement instructions for each designated account of the trade, and adds the instructions to the trade details.
  • the STP trading platform 100 is designed to record and store in the trade history database 115 a historical record of all transactions executed, including a historical audit trail of all phases of the trade cycle, to thereby facilitate problem resolution should any issues or disputes arise.
  • the confirmation process may also be performed on the STP trading platform 100.
  • the STP trading platform 100 provides dealers with the ability to have confirmations electronically generated and transmitted to customers through the STP trading platform 100 in a manner that would satisfy the requirements of applicable government regulations, such as SEC Rule 10b- 10.
  • the transaction information contained in the confirmation is based on the terms of the transaction that have been agreed to between the customer and the dealer over the STP trading platform 100.
  • dealers can confirm that the trade details and the records of the customers are accurate. If the dealer determines that the details of the customer's allocations are accurate, then the dealer can acknowledge the allocation via the STP trading platform 100.
  • the STP trading platform 100 then dynamically generates an electronic confirmation in accordance with applicable government regulations, for example, SEC Rule 10b- 10, to facilitate the electronic confirmation of trades.
  • the STP trading platform 100 is also preferably adapted to handle the processing and confirmation of trades executed either via telephone or via an alternate trading system.
  • the confirmation is based on transaction information that is electronically imported into the STP trading platform 100 by the dealer and affirmed by the applicable customer. In each case, the affirmation reflects any allocation among sub- accounts that has been made by the customer and accepted by the dealer.
  • both the customers and dealers are provided access through a back office management module 140 of the STP trading platform 100 to a master trade blotter interface, as well as various other summary interfaces.
  • the summary interface preferably displays trade information on a dealer- by-dealer basis.
  • the summary information preferably includes the number of trades, the number of trades cancelled or corrected, the number of block trades allocated or unallocated, the number of tickets generated, the number of trades confirmed or unconfirmed, and the number of trades for which there are errors.
  • This summary interface allows back office personnel to quickly and efficiently determine whether any executed trades have outstanding issues that require attention.
  • the dealer-side has access to summary trade information on a customer-by-customer basis.
  • the STP Trading Platform 100 further includes a prime broker software client 266 that includes an electronic trading component 267 and a back-office management component 268.
  • the prime broker software client 266 is configured to receive and display trade details and permits prime brokers to view and approve trades and in one embodiment perform various other back office functions.
  • software modules 120, 140, 160 of the STP trading platform 100 are capable of communication with customer-side software application components 210 operative on customer computers 200 via a communications network 50.
  • dealer-side software application components 270 are operable on dealer computers 260 and capable of communication with the STP trading platform servers 105.
  • prime broker software client 266 is operable on prime broker computers 265 and capable of communication with the STP trading platform servers 105.
  • the software modules 120, 140, 160 operative on the STP trading platform servers 105 with the client-side, dealer-side, prime broker software modules 210, 270, 265 comprise the server-client software system of the STP trading platform 100.
  • the client-side software application components 210 such as the customer-side electronic trading and back office management components 215, 220 the dealer-side electronic trading and back-office management components 275, 277 and the prime broker electronic trading and back-office management components 267, 268 are preferably "thin-clients".
  • the term "thin-client” generally refers to a software client designed to be relatively small so that the bulk of the data processing occurs on the server.
  • the customer, dealer and prime broker electronic trading and back office management components 215, 220, and 275, 277 and 267, 268 respectively are relatively small software applications capable of generating graphical user interface templates on the customer, dealer and prime broker computers, such as the exemplary graphical user interface templates shown in FIGS. 5-6, 8-18, which are populated and controlled, at least in part, by the software modules operative on the centralized STP trading platform servers 105 in communication with customer dealer and prime broker computers 200, 260 and 265.
  • Persons of skill will recognize, however, that the use of thin-client technology, as opposed to other known and heretofore-developed client-server technologies, is not critical to the present invention.
  • the electronic trading module 160 is operative on the STP trading platform servers 105 to communicate with and provide functionality to the dealer-side, customer-side and prime broker electronic trading components, which generate and display graphical user interfaces that are populated by information communicated from dealers (e.g., live market pricing data) and retrieved from the account management database 110 (e.g., account information and settlement instructions), as described further below.
  • dealers e.g., live market pricing data
  • account management database 110 e.g., account information and settlement instructions
  • the account management module 120 is also preferably a server- side software application operative on the STP trading platform servers 105 and accessible by customer, dealer and prime broker computers 200, 260, 265 via a communications network 50, such as the Internet.
  • the account management module 120 is database management software programmed with graphical interfaces to provide a web-based program that can display information retrieved from the account management database 110 via the Internet and create, update, modify or delete, as applicable, account records including settlement instructions.
  • customers and dealers can access their accounts through the account management module 120 of the STP trading platform 100.
  • the account management database 110 is also accessible by the electronic trading module 160 so as to permit the electronic trading module 160 to retrieve information from the account management database 110, when necessary.
  • Customer dealer and prime broker computers 200, 260 and 265 are any type of personal or network computer such as an IBM-compatible computer running an Intel chipset and having an operating system, such as Microsoft® Windows® NT, 2000, XP, and the like, and, preferably, running a browser program such as Microsoft® Internet Explorer or Netscape Navigator®. It is also within the scope of the present invention that computers 200, 260 and 265 may be handheld or table computing devices, such as a personal digital assistant (PDA), pocket PC, and tablet PC, or the like. Computers 200, 260 and 265 have access to a communications network via a modem or broadband connection to permit data communication between the participants and the STP trading platform 100.
  • PDA personal digital assistant
  • Various input and output devices are preferably provided with the customer dealer and prime broker computers 200, 260 and 265 including, by way of non-limiting example, a display (e.g., cathode ray tube (CRT), liquid crystal display (LCD), etc.), and an input device (e.g., a keyboard, mouse, touch pad, or light pen).
  • the customer and dealer computers 200, 260 would also preferably include a storage device such as, for example, a magnetic disk drive and magnetic disk, a CD-ROM drive and CD-ROM, DVD, or other equivalent device.
  • the specific hardware combination/configuration is not crucial to the instant invention, and may vary as a matter of design choice within the functional parameters disclosed herein.
  • GUI GUI
  • buttons e.g., buttons
  • the present invention is not limited to clicking with a computer mouse, but includes use of any other device for indicating an action with graphics-based software, such as a touch pad, light pen, touch sensitive display screen and the like.
  • the STP trading platform servers 105 may be computer servers of any type known in the industry, but capable of handling the flow of data on a substantially real-time basis. Moreover, persons of skill will recognize that multiple servers in a server farm arrangement may be utilized to handle the bandwidth and processing requirements of a particular arrangement of the present invention.
  • Trade history databases 115 and account management databases 110 are controlled by the software modules 120, 140, 160 to retrieve data, when necessary.
  • the storage devices themselves may be any mass storage devices capable of storing large amounts of data in an organized fashion, such as known data storage devices including, but not limited to hard disks, tape drivers, optical disks and the like.
  • Communication between the customer-side, dealer-side, prime-broker side and the STP trading platform 100 may be accomplished via electronic messaging using the Extensible Mark-up Language (“XML"), Financial Information Exchange (“FIX”) or Financial Products Mark-up Language (“FpML”) format.
  • XML Extensible Mark-up Language
  • FIX Financial Information Exchange
  • FpML Financial Products Mark-up Language
  • an API is provided to enable users to establish connections to the STP trading platform 100, authenticate their systems, and exchange messages using, for example, the XML-based messaging protocol.
  • Table I that follows illustrates exemplary messages that may be used during the flow of the trading cycle.
  • AllocationList +Allocation array +Ac count ID +Quantity decimal +ClearingLoc (if non-US) +GiveUpBroker (BIC) +StepOutBroker (BIC) +GTSBroker (BIC) +AllocRef +Note
  • Couponlnstrument Product +GOVERNMENT ⁇ implementation> +AGENCY +CORPORATE +MONEYMARKET
  • Discountlnstrument Product GOVERNMENT ⁇ implementation> +AGENCY +MONEYMARKET +MUNICIPAL Security +BA
  • a customer may access the account management module 120 of the STP trading platform 100 so as to input information to create, maintain, and update sub-accounts for allocation of block trades and to enter standing settlement instructions to facilitate electronic settlement of executed trades in accordance with an exemplary embodiment of the present invention.
  • the STP trading platform 100 is operative with the account management database 110 to act as a centralized account management database for customers, dealers, custodians, and agent bank accounts and sub-accounts, and to store standing settlement instructions for said customers, custodians, and agent banks.
  • the account management module 120 is operative to create a web-based environment through which users can access settlement and account data, and manage standing settlement instructions.
  • the account management module 120 also preferably performs account validation, as described further below.
  • FIG. 5 is an example of a database schematic 500 of the account management database 110 for storing company account profiles 510 and corresponding settlement instructions 520.
  • the account profiles and associated settlement instructions stored in the account management database 110 are mapped to the account information utilized by the electronic trading module 160. In this way, trade details can be enriched dynamically with account and settlement information from the account management database 110.
  • customers can interact with the account management module 120 of the STP trading platform 100 through a web-based interface 600 as shown in FIG. 6, to manage and update their account information.
  • the account management interface 600 is preferably standardized and provides field level validation to reduce the possibility of errors in the account information.
  • the account management interface 600 has a minimum standard for information that must be entered in order to create a new account or sub-account. The minimum information requirement is driven by industry standards for the particular jurisdiction and financial product that the account is being created to accommodate.
  • the account management interface 600 uses drop-down menus that users can select from pre-defined lists.
  • the account management module 120 is programmed to ensure that particular fields require particular types of information.
  • the "TAX ID" field 610 generally requires an 8-digit numeric-code.
  • the account management module 120 is configured to check the entered information against field level validation standards stored in a field level validation database to determine whether any information has been improperly entered.
  • the account management module 120 would detect the error and prompt the customer to enter the proper information.
  • the account management module 120 could trigger a message to the customer as soon as improperly, non- validated information was entered into the system.
  • the account management module 120 would notify the user of the error.
  • the account management database 110 also stores standing settlement instructions using a standardized and field level validated data structure.
  • FIG. 6 there is shown an exemplary embodiment of a customer account management interface 600 showing standing settlement instructions for a particular clearing institution and particular financial instruments. Because dealers use this information to settle securities transactions, its accuracy is important to achieving straight-through-processing. It should be understood that the information entered into the fields is illustrative and not meant to be indicative of actual settlement instructions. Input of standing settlement instructions using the account management module 120 is performed using industry-standardized data.
  • SWIFT codes are used to populate data fields. For instance, if a hypothetical SWIFT code of "ABCCUS33XXX" is entered, the other fields necessary to complete the creation of the settlement instructions are automatically populated using cross-references to the SWIFT codes embedded in the account management database 110. Such standardization and automation reduces the possibility of human input errors, which are a source of costly trade settlement failures.
  • the account management module 120 may also perform field level validation on fields that are not able to be auto-populated using embedded cross- references in the same manner, as described above in connection with FIG. 6.
  • FIGS. 3 and 4 are data flow diagrams depicting an exemplary flow of data between customer and dealers through the STP trading platform 100 to effect a trade.
  • trade orders can be initiated through electronic submission from an internal order management system ("OMS").
  • OMS internal order management system
  • the customer-side computers 200 communicate with OMS using a defined communication protocol supported by an API.
  • FIX Financial Information Exchange
  • Table III shows two exemplary messages for importing new order messages from OMS:
  • the exemplary flow of FIG. 3 depicts a trade initiated via the composite price matrices.
  • the STP trading platform 100 collects and aggregates live market pricing data and prices received from dealers.
  • step 3b upon launch of the customer- side electronic trading component 215, composite screens are generated and populated using the dealer trade price information transmitted to the STP trading platform 100 by dealer systems.
  • step 3c the indicative market price feeds are accessible via communications network 50 on customer computers 200 and dealer computers 260.
  • the electronic trading component 215 operative on customer computer 200 generates graphical interfaces and provides functionality for initiating and executing trades.
  • step 3e customer traders manually enter trade orders or electronically upload orders from OMS that would include allocation instruction, and select dealers to enable a competitive, auction-type trade inquiry.
  • Trade inquiries are then transmitted through the STP trading platform 100 servers to the selected dealer's computers 260, in step 3f. These inquiries include information related to the customer's prime broker if a prime broker is to be used for the transaction.
  • automated dealer trade systems in step 3g, respond to the inquiries and transmit firm market prices through the STP trading platform servers 105.
  • step 3h the firm dealer prices populate the customer's trading screens.
  • customer traders can execute trades by hitting or lifting a bid or offer, as applicable.
  • the customer's back office can enter block trade allocations if the trade was not already pre-allocated, and transmit the same to the customer computers 200 the dealer computers 260 and the prime broker computers 265, in step 4a.
  • the dealer acknowledges the customer's block trade allocation.
  • the dealer-side software client 270 Upon receipt of the customer's allocations, if any, the dealer-side software client 270 confirms the details of the block trade and allocations and retrieves standing settlement instructions from the account management database 110, and may, but not necessarily, generate an electronic confirmation of the trade. Throughout the process outlined in FIGS. 3 and 4, records of the customer's trade inquiry, the dealer's price response, details concerning whether prices were rejected or accepted, the final trade details, the customer's account allocations, if any, any prime broker information and electronic confirmations are stored in the trade history database 115.
  • the back-office management component 268 operative on the prime broker computer 265 generates graphical interfaces and provides functionality for allowing the trade details to populate the prime broker's screens and the details are similarly electronically transmitted and displayed to the dealer and customer as discussed below.
  • a prime broker can either provide General Trade Servicing ("GTS"), which means that the prime broker is monitoring the trade of its customers but is not acting in a principal capacity, a prime broker can act in a give-up capacity which means that the prime broker actually becomes a counter party to the trade replacing the customer with an off-setting trade facing the executing dealer.
  • GTS General Trade Servicing
  • Step 716 If the prime broker is not acting in a give-up capacity, but rather only providing GTS, a message indicating the successful trade and the allocation details is transmitted to the dealer, customer, and prime broker via the respective back- office management components 220, 277, and 268. Step 716. If the prime broker is acting in a give-up capacity, once the trade details are approved by the prime broker, the prime broker "steps in” in place of the executing dealer as the counterparty for the trade with the customer and “steps in” as the counterparty to the trade with the executing dealer. Step 718. Lastly, a message including the details of the trade which list the prime broker and the dealer as parties of the transaction and allocation details are sent to the dealer, customer and prime broker, as applicable. Step 720.
  • the STP Trading Platform 100 also can provide functionality that supports the "Remaining Party Model” and the "Step-Out Model” with regard to novation events in the over-the-counter (OTC) markets.
  • OTC over-the-counter
  • the primary difference between the Remaining Party Model and the Step-out Model relates to the entity that is considered the remaining party to the transaction and, therefore, has the right to accept/reject a trade that was assigned to another 3rd party entity (as defined by the ISDA Novation protocol).
  • the prime broker remains principle to the original "give- up" transaction.
  • the customer upon a novation event, they are considered the "Remaining Party" (the customer remains as transferor and the step-in dealer as the transferee) and can accept or reject the assignment.
  • the Step-Out Model when the customer assigns the trade to another dealer, an unwind or tear-up occurs between the client and their prime broker for that trade.
  • the prime broker is considered the transferor and the original executing dealer is considered the remaining party.
  • the original executing dealer has the right to accept or reject the assignment.
  • the STP Trading Platform 100 is configured to track the selections made by the parties to a trade to determine whether a novation or assignment has been triggered. Because the STP Trading Platform 100 tracks the customer, prime broker, and dealer on each trade, the STP Trading Platform 100 can make a determination as to whether the prime broker or original dealer is the "remaining party" and, therefore, provide the appropriate interfaces to the remaining party to accept or reject the subject trade.
  • the STP trading platform 100 permits customers to submit trade inquiries to multiple dealers simultaneously.
  • the "Order Type" field of the "New Trade Order” message would be set to auction.
  • customers can submit requests to purchase from financial instrument inventories, such as commercial paper offering (CPO) and corporate bond inventories. All dealers receiving an inquiry and willing to trade the specific instrument for the transmitted quantity will message the customers with a firm quotation to buy or sell by filling out a trade ticket displayed on the dealer- side computers 260.
  • the customer reviews the quote and determines to accept or reject the quote or allow the quote to lapse. A transaction is completed only if both the customer and dealer accept the quote.
  • step 4f The electronic confirmations are then made available to customers for review and acceptance, in step 4f, and, in step 4g, the customer can electronically confirm or reject the trade through the STP trading platform 100.
  • step 4h if the electronic confirmation is confirmed by the customer and dealer, then the trade is listed as "AFFM" in the master blotter stored in the trade history database 115 of the STP trading platform 100. This process will be described in greater detail below.
  • FIGS. 8-17 there are shown screen shots of an exemplary user interface using a prime broker in the STP trading platform 100.
  • a customer can retrieve a list of its prime brokers to specifically select which prime broker it wishes to use for a particular trade. Since customers may have multiple prime brokers, this enables the customer to choose which prime broker to use for which trade.
  • the prime broker can use a view, as shown in FIG. 9, to view a listing of users who have chosen them as prime brokers and to authorize which prime broker services should be allowed for each particular customer. For example, as can be seen in FIG.
  • a prime broker can choose or select which of its customers should have which prime broker service per product. For example, as discussed above, a prime broker can give its customer GTS which means that the prime broker will monitor and perform operational processing requirements for the customer's trades but will not become a principle on the trade itself. Although the prime broker will not act as a principle, it may act as a clearing agent. Alternatively the prime broker can provide a "give up" service to its customers in which the prime broker would become the principle on the transaction in lieu of its customer. Thus, the prime broker has the ability to designate which of its customers maintain which services from within the STP Trading Platform 100.
  • the prime broker computer 265 is configured to receive and display a page displaying a list of dealers along with a list of customers. Utilizing this listing, the prime broker will be allowed to establish links to their customer base and identify which customers should have which prime broker services for which product. Once the prime broker has identified its customers in the account management database 110 using for example display 1000 and 1005, the customer will have the opportunity to view and confirm the prime broker's inputted information.
  • the linking information identified in the account management database as described above enables the STP Trading Platform 100 to monitor transactions involving the prime broker and its customers and enables the display via a Viewer interface of such transaction information.
  • the linking of the transaction information in this manner enables the "give-up" authorization process and trade processing flow described herein.
  • Screenshot interfaces depicting the execution of a trade utilizing a prime broker on the STP Trading Platform 100 will now be described in greater detail.
  • the trading screen 1100 preferably has a drop down list allowing the user to click on or select the prime broker to be used in connection with the execution of a trade from drop down list 1105.
  • the customer can select to not use a prime broker for the execution of the trade and rather process the trade directly.
  • a view 1200 summarizing details of the trade is displayed for the customer.
  • the prime broker e.g., DLRX
  • the trade type is listed as a new trade and as a give up.
  • a message is sent to the prime broker on the system and the prime broker has the ability to approve or to reject the trade.
  • the prime broker's lack of action is viewed as an acceptance.
  • the STP Trading Platform 100 can wait to receive an affirmative acceptance or rejection from the prime broker before designating the trade as having been accepted. After the trade is accepted by the prime broker the trade-type can change to indicate such acceptance.
  • FIG. 13 a screen showing the status of various trades including a prime broker field 1305 is shown. The summary lists the details of the trade including the counterparty, the rate and any estimated fee associated with such trade. Additionally, the give-up state field 1310 indicates whether the trade was executed using a prime broker who became the principle of the trade.
  • the prime broker is listed in counterparty field 1315 and the executing dealer is listed in the prime broker field 1305. If however, the prime broker was used as a GTS, such prime broker is listed in the prime broker field 1305 and the executing dealer is listed in the counterparty field 1315.
  • a customer can indicate that a prime broker is to be used for a particular transaction but not designate which prime broker is to be used until a later point in the transaction.
  • a screenshot depicting such a scenario is shown in FIG. 14.
  • a screen 1400 which displays a trade inquiry by the customer where the prime broker field 1410 is set to "to follow". This indicates that the customer has requested a give-up but does not yet want to reveal their prime broker.
  • a customer can identify their prime broker from display 1600 at the sub-account level. This is necessary, because if using a prime broker, the customer enables a sub-account with such prime broker so the prime broker will have access to view and accept trade information. As can be seen in field 1610, the customer can either enter a name of their prime broker of choose a prime broker from their drop down list based upon the information stored in the account management database 110. Once the prime broker has been identified at the prime broker level, the prime broker will be informed about the trade and access information related thereto via the prime broker computer 265 utilizing the prime broker software client.
  • screen 1700 is displayed for the prime broker to show details about the trade and obtain consent for the give-up. Additionally, messaging can be sent to the client via a message API as discussed above to alert the prime broker that consent to a give-up is being requested.
  • the customer may have the authorization, as part of a transaction, to trade using the credit of a dealer.
  • the STP Trading Platform will perform a check against the account management database 110 to determine the Executing Broker Agreements on file. Based on the dealers the prime broker has an agreement with, the STP Trading Platform will only allow an inquiry to be submitted to the corresponding dealers. 3. Trade Execution — Alternate Systems and Phone Trades
  • the STP trading platform 100 is also preferably configured to process trades executed on systems other than the electronic trading module of the STP trading platform 100, such as trades executed via telephone or by an alternate electronic trading system.
  • trade details from alternate systems can be electronically imported into the STP trading platform 100 via electronic messaging using an API.
  • STP functionality as described herein, can be provided for trades executed on alternate systems or via the telephone.
  • the STP trading platform 100 are be communicatively linked to a dealer's internal systems or trade management systems to import trade details. The trade details are delivered to the customer via STP trading platform 100 in the "DONE" state.
  • step 18a the dealer and customer execute a phone trade in a known manner.
  • the dealer then inputs the trade details into its internal trade management system, in step 18b.
  • step 18c the phone trade details are electronically imported into the STP trading platform 100 using the exemplary message format shown above.
  • the phone trade details are assigned a "DONE" state (see Table V below) while customer acceptance is outstanding.
  • the phone trade details are messaged to the customer-side electronic trading module 215 for review by the customer.
  • the customer may accept the phone trade, as in step 18e, or reject the phone trade, as in step 18f. If the phone trade is accepted or checked-out, it is assigned the "ACC" state. If the phone trade is rejected, it is assigned the "REJ" state. In the case of a rejected trade, the dealer is given an opportunity to correct the phone trade details, in step 18g.
  • step 18d The process flow returns to step 18d and the corrected phone trade is transmitted again to the customer.
  • the corrected phone trade is again assigned the "DONE" state.
  • a phone trade pop-up message which can include the phone trade details that can be displayed for the customer to allow the customer to review the details of the phone trade and permit the customer to confirm or reject such trade.
  • Phone trades that are accepted by the customer may be allocated, confirmed, assigned to a prime broker and enriched with settlement instructions in the same manner as other trades handled by the STP trading platform 100.
  • DONE Imported block trade details form phone trade or alternate trading system.
  • ACC Block trade is accepted by customer, but not allocated.
  • CONF Dealer confirms all allocations, but does not send ETC.
  • DLRCONF Dealer confirms all allocations and sends ETC to customer.
  • CONFP Dealer confirms some, but not all of the allocations. No ETC transmitted.
  • ETCREJ Customer rejects ETC or chooses to amend allocations.
  • the STP trading platform 100 is preferably, but not necessarily, configured to compare trade details and related information received from dealers and customers and permit electronic confirmation according to applicable government laws, rules and regulations.
  • SEC Rule 10b- 10 requires that certain disclosures be included in a confirmation.
  • the STP trading platform 100 may be programmed to generate an electronic trade confirmation ("ETC") template containing the required Rule 10b- 10 disclosures.
  • ETC electronic trade confirmation
  • the ETC template preferably includes the fields listed in Table VI.
  • Table VI also sets forth an exemplary model for retrieving information from the account management and trade history databases 110, 115 to facilitate creation of the ETC.
  • Security code type e.g., CUSIP, ISIN, SEDOL
  • Asset backed disclaimer (may be part of Dealer disclaimer above) AM
  • the exemplary confirmation system of the present invention where a prime broker is used preferably follows the following data flow as shown in FIG. 19.
  • a customer makes a give-up trade inquiry identifying that the customer wishes to use a prime broker for the proposed transaction.
  • One or more dealers transmit trade quotes, in step 19b.
  • the customer then, in step 19c, selects one of the quotes to execute a trade.
  • the trade details for block trades including information about the prime broker would be stored electronically in an associated trade history database 115.
  • the trade history database 115 stores a record for each trade executed on the STP trading platform 100 using a unique identifier for each such trade.
  • the trade details for block trades would be electronically imported by a dealer through the dealer's trade blotter interface and then communicated to the appropriate customer and prime broker, as described above. If the terms of the non-system block trade are accepted by the customer, the block trade is given the "ACC" state and a record of the accepted trade is stored in the trade history database 115. The block trade detail can then also be used to populate the trade blotter and other back office management interfaces of the customer and the prime broker. [0104] After receiving the trade details of an accepted block trade, a prime broker would decide whether to accept the trade as a prime broker as described above. Step 19d.
  • the customer reviews the details and may include any trade allocation instructions in step 19e.
  • the STP trading platform 100 assigns the "ALLOC" state and transmits each allocation ticket created by the STP trading platform 100 as a result of the customer's allocations to the dealer and prime broker.
  • a record of the allocations is also stored by the trade history database 115.
  • each allocation ticket may be enriched with settlement instructions electronically accessed from the account management database 110 of the STP trading platform 100.
  • step 19f the dealer reviews the allocation tickets and processes the trade details for each sub-account set forth in the allocation. The dealer may then acknowledge that it has processed and accepted each allocation ticket in step 19g.
  • the dealer can only confirm certain of the allocations and the trade will be assigned the "CONFP" partial confirmation state and an error message will be transmitted over the STP trading platform 100 to the customer with specific instructions explaining why the specific allocation ticket could not be processed. If the dealer rejects all of the allocations, as in step 19i, the trade will be returned to the customer and assigned the "ERR" state.
  • the STP trading platform 100 may generate an ETC, in step 19j.
  • the allocated trade is assigned the "CONF" state.
  • Each ETC will preferably include all the information required to be disclosed under relevant government laws, rules, or regulations, if applicable, such as by way of example SEC Rule lOb-10.
  • the ETCs would provide dealers the ability to include any additional disclosures that they may wish to provide, which are specific to the dealer.
  • the ETC may also indicate that the customer should contact the dealer with whom it effected a transaction with any questions.
  • any such communication following delivery of the ETC would preferably occur directly between the dealer and the customer, although the dealer and the customer may elect to use electronic messaging facilities provided by the STP trading platform 100.
  • the ETC conform to applicable government laws, rules, or regulations
  • the ETC of the present invention may be utilized in jurisdictions where not such applicable government laws, rules, or regulations exist. In such cases, the ETC may still be used to electronically confirm trades in a binding fashion through use of master trading agreements and the like.
  • the ETC is populated by the STP trading platform 100 using the enriched trade details and allocations stored in the trade history database 115 and the settlement instructions retrieved from the account management database 110 to preferably provide a standardized electronic confirmation as required by government regulation, (e.g., SEC Rule 10b- 10).
  • SEC Rule 10b- 10 e.g., SEC Rule 10b- 10
  • the customer and prime broker receives and can review and electronically confirm the trade details through the STP trading platform 100 by indicating an acceptance of the ETC.
  • the STP trading platform 100 Upon confirmation by a customer, in step 19k, the STP trading platform 100 would display the transaction state as "AFFM".
  • Each of the customer, dealer and prime broker would have the ability to view, download, and/or print their ETCs through the STP trading platform 100, and may establish default procedures pursuant to which such ETCs are downloaded and/or printed automatically.
  • ETCs would also preferably be stored electronically by the STP trading platform 100 in the trade history database 115, although this feature is not required.
  • the STP trading platform 100 may also enable the customer (or a custodian or designated third party on behalf of the customer) to accept the trade details and settlement instructions in a number of different ways.
  • the customer may use the back office management tools provided by the STP trading platform 100 to receive the trade details and the related settlement instructions from the dealer and manually compare the information it receives against its internal records. If the customer agrees that the information it received from the dealer matches with the information in its database, the customer will transmit an indication that the customer affirms the trade details and the settlement instructions via the STP trading platform 100 to the dealer.
  • the STP trading platform 100 may provide functionality to enable customers to electronically affirm trade details and settlement instructions in order to electronically match trade data submitted by dealers and customers. In such instances, the electronic confirmation would be based on the matched trade data and other information provided.
  • the STP trading platform 100 records the trade details on behalf of the customer as trades are effected via the electronic trading module 160 of the STP trading platform 100, as described above.
  • trade information is made available to the STP trading platform 100 through an API that interacts with the customer's internal trade processing systems and/or order management systems, as also described above.
  • the trade details and settlement instructions provided by the customer are then electronically matched by the STP trading platform 100 to trade details and settlement instructions provided by the dealer on the STP trading platform 100. If the trade details and settlement instructions received from the dealer match the information provided or made available to the STP trading platform 100 by the customer, the STP trading platform 100 will electronically and automatically affirm the trade on behalf of the customer.
  • the STP trading platform 100 may also transmit the affirmed trade confirmation (in accordance with the applicable self-regulatory organization rules) directly to a depository, such as the Depository Trust & Clearing Corporation ("DTCC") or a settlement agent for settlement of the trade.
  • DTCC Depository Trust & Clearing Corporation
  • a settlement instruction validation system 180 compares the data in the account profiles stored on the account management system 110 to known data sources. By making such a comparison, the settlement instruction validation system 180 can determine whether there are any errors present in the stored settlement instructions.
  • the settlement instruction validation system 180 compares settlement instructions to databases such as the SWIFT BIC, the Euroclear code, and other like directories comprising codes for various entities and securities involved in the settlement process. Furthermore, the settlement instruction validation system 180 may perform character-based validation. In this example, the settlement instruction validation system 180 compares known standards for certain fields with the actual stored fields. For example, it is known that Bank Routing Number (or ABA number) must have 8-digits. The settlement instruction validation system 180 would detect an ABA number field with less than 8-digits. Errors can be reported in a summary validation report that may be issued daily, weekly, monthly, or on some other time basis as a matter of design choice. The reports would identify errors in stored settlement instructions and permit correction to avoid settlement failures.
  • databases such as the SWIFT BIC, the Euroclear code, and other like directories comprising codes for various entities and securities involved in the settlement process.
  • the settlement instruction validation system 180 may perform character-based validation.
  • the settlement instruction validation system 180 compares known standards for certain fields with the actual
  • the STP trading platform 100 is programmed to generate performance reports for customers and dealers to enable enriched tracking of trade executed and STP performance. Those reports can also be extended to include reports that incorporate prime brokerage functionality and STP performance.
  • a customer can utilize multiple prime brokers for a single trade and either use such prime brokers in tandem with each other or use the prime brokers as alternatives to each other.
  • An embodiment showing the additional steps required in the flow of a trade using multiple prime brokers on the STP Trading Platform 100 will now be shown and described in more detail with reference to FIG. 20.
  • a customer selects prime brokers to use in the execution of trades. For each prime broker, an agreement is executed that outlines and governs the relationship between such prime broker and the customer and sets forth when such prime broker will "step into" a trade on customer's behalf. Step 2002.
  • the electronic trading component 215 operative on customer computer 200 generates graphical interfaces and provides functionality for allowing the customer to identify its prime brokers as discussed above.
  • a customer chooses to execute a trade using multiple brokers, the customer and dealer agree to the details of the trade as they would in a non-prime broker or single prime broker transaction using the STP Trading Platform 100 as discussed above, and the customer alerts the dealer that it wishes to use its prime broker to carry out the trade.
  • the back-office management component 268 operative on the prime brokers computers 265 generates graphical interfaces and provides functionality for allowing the trade details to populate the prime brokers' screens and the details are similarly electronically transmitted and displayed to the dealer and customer as discussed above. Step 2006 and Step 2008.
  • each prime broker can either approve or reject the trade based on its relationship with the customer. Step 2010. If for example the first prime broker rejects the trade, the customer and dealer receive notification of the prime broker's rejection. 2011 If the first prime broker accepts the trade, a determination is made as to whether the first prime broker is acting in a "give -up" capacity. Step 2012. If the first prime broker is not acting in a give-up capacity, but rather only providing GTS, a message indicating the successful trade and the allocation details is transmitted to the dealer, customer, and prime broker via the respective back- office management components 220, 277, and 268. Step 2014.
  • Step 2016 A message including the details of the trade which list the prime broker and the dealer as parties of the transaction and allocation details are sent to the dealer, customer and prime broker(s), as applicable.
  • the second prime broker can either approve or reject the trade based on its relationship with the customer.
  • Step 2020 If for example the second prime broker rejects the trade, the customer and dealer receive notification of the prime broker's rejection.
  • the second prime broker accepts the trade a determination is made as to whether the second prime broker is acting in a "give-up" capacity.
  • Step 2022 If the second prime broker is not acting in a give -up capacity, but rather only providing GTS, a message indicating the successful trade and the allocation details is transmitted to the dealer, customer, and prime broker via the respective back- office management components 220, 277, and 268.
  • Step 2024 If the second prime broker is not acting in a give -up capacity, but rather only providing GTS, a message indicating the successful trade and the allocation details is transmitted to the dealer, customer, and prime broker via the respective back- office management components 220, 277, and 268.
  • Step 2026 A message including the details of the trade which list the prime broker and the dealer as parties of the transaction and allocation details are sent to the dealer, customer and prime broker(s), as applicable. Step 2028.
  • the third prime broker can either approve or reject the trade based on its relationship with the customer.
  • Step 2030 If for example the third prime broker rejects the trade, the customer and dealer receive notification of the prime broker's rejection.
  • the third prime broker accepts the trade a determination is made as to whether the third prime broker is acting in a "give-up" capacity.
  • Step 2032 If the third prime broker is not acting in a give-up capacity, but rather only providing GTS, a message indicating the successful trade and the allocation details is transmitted to the dealer, customer, and prime broker via the respective back- office management components 220, 277, and 268 respectively.
  • Step 2034 If the third prime broker is not acting in a give-up capacity, but rather only providing GTS, a message indicating the successful trade and the allocation details is transmitted to the dealer, customer, and prime broker via the respective back- office management components 220, 277, and 268 respectively.
  • Step 2036 A message including the details of the trade which list the prime broker and the dealer as parties of the transaction and allocation details are sent to the dealer, customer and prime broker(s), as applicable.
  • each prime broker can approve or reject their portion of the trade in accordance with the flow discussed above.

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Abstract

Une plate-forme d'échanges bancaires à traitement sans rupture de charge (STP) propose une solution entièrement électronique et transparente portant sur sensiblement tous les aspects du cycle d'échanges bancaires des instruments à taux fixe et d'autres instruments financiers. Dans un mode de réalisation ayant valeur d'exemple, un ou plusieurs clients, un ou plusieurs négociants et un ou plusieurs courtiers ont accès à un logiciel qui facilite la gestion d'un ordre d'opération, la génération de l'ordre d'opération, l'exécution de l'opération, l'affectation de l'opération, la reconnaissance de l'affectation, la confirmation de l'opération, l'acquisition des instructions de liquidation et la génération de rapports d'avancement sur la base de critères métriques spécifiques. Dans ledit mode de réalisation ayant valeur d'exemple, la plate-forme d'échanges bancaires STP permet à un courtier de surveiller et d'approuver une opération, la plate-forme d'échanges bancaires STP comprenant des modules logiciels, notamment au moins un module de gestion de compte et un module d'échanges bancaires électronique permettant de traiter les diverses étapes consistant à exécuter une opération, confirmer l'opération et faciliter la liquidation de l'opération.
EP08795860A 2007-05-22 2008-05-22 Procédé et système d'administration de courtage Ceased EP2150935A4 (fr)

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WO2004088460A2 (fr) * 2003-03-25 2004-10-14 Tradeweb Group L.L.C. Procede et systeme de mise en oeuvre d'un traitement direct de commerces de differents instruments financiers
WO2005022363A2 (fr) * 2003-09-02 2005-03-10 Steven Cooper Mecanisme indicateur de duree et messagerie directe pour plate-forme de negociation electronique
US7487125B2 (en) * 2005-01-14 2009-02-03 Littlewood Margaret G Method for providing aggregation of trading on multiple alternative trading systems

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Title
EPO: "Mitteilung des Europäischen Patentamts vom 1. Oktober 2007 über Geschäftsmethoden = Notice from the European Patent Office dated 1 October 2007 concerning business methods = Communiqué de l'Office européen des brevets,en date du 1er octobre 2007, concernant les méthodes dans le domaine des activités", JOURNAL OFFICIEL DE L'OFFICE EUROPEEN DES BREVETS.OFFICIAL JOURNAL OF THE EUROPEAN PATENT OFFICE.AMTSBLATTT DES EUROPAEISCHEN PATENTAMTS, OEB, MUNCHEN, DE, vol. 30, no. 11, 1 November 2007 (2007-11-01), pages 592-593, XP007905525, ISSN: 0170-9291 *
See also references of WO2008144771A1 *

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