GB1352742A - Data processing - Google Patents

Abstract

1352742 Digital computer for Stock Exchanges F NYMEYER 19 May 1971 15865/71 Heading G4A A digital computer for controlling a stock exchange (or commodity or auction markets for wheat, corn &c.) is described. Buy and sell orders for stock are entered from one or more input/output units 11, 14, e.g. typewriters which produce punched tape in response to a manual input or an electrical input, or magnetic tape. Each order (Fig. 3, not shown) has sections giving the identity, size, the price required (or market price), whether the order is buy or sell, the identity of the broker or customer, the input/output unit, and the time of receipt of the order. The data may be entered as alphabetic or decimal data but is converted (preferably to binary or BCD) in encoder 17 which also multiplexes the input/output units. The received data is held in a magnetic core, drum or disc store 18. The entered orders are broken into individual lots, e.g. of 100 shares, by repeated subtraction in unit 24 using 2's complementing or l's complementing plus one and recorded in a buy sequencer 28 or sell sequencer 29 depending on whether they are buy or sell orders. Each sequencer (Fig. 2, not shown), comprises a magnetic drum or disc store and other circuitry, the buy sequencer arranging buy orders in descending order by price and also by time so that at each price level the oldest orders are uppermost, the sell sequencer arranging orders in ascending order by price but in descending order by time. Orders having desired prices at the "market value" are placed in the region of the last completed transaction. Then the market price for the next sales transaction is determined by price comparator 31 which compares respective orders in the two sequencers item by item (descending by price in the purchase sequencer and ascending by price in the buy sequencer) until two incompatible orders appear, i.e. the desired buying price of an order is lower than the desired selling price of the compared order, and the system then prints out the last two comparisons which give the current market price. Two examples are given of price determination in a fairly steady market in which the "market value" orders can be fitted in. When there is an unstable market, e.g. on receipt of good news about a stock, the "market value" orders are initially omitted from the price calculation. All the "market value" orders are transferred to a subtractor 34 and a correction counter 35 where the difference between the amount of stock for sale and the "market value" orders is determined. The price determination is effected with the remaining orders as before then the sequence of sell orders is stepped by a number equal to the difference and a new market price established. A complete record of all transactions is available for print out. This procedure is followed for each stock being traded. A complete stock exchange system having up to 100 input/output units connected by telephone or telegraph lines is described (Fig. 4, not shown) where orders are placed in one period, then transactions and new prices are determined as described, the input/output units informed and a new order period commences &c. The system is controlled by a conventional computer, e.g. an IBM 7094. A separate market comparator device is also described (Fig. 7, not shown).