(2) Patent Application Publication (10) Pub. No.: US 2016/0078538A1 Katsuyama Et Al
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US 20160078538A1 (19) United States (2) Patent Application Publication (10) Pub. No.: US 2016/0078538A1 Katsuyama et al. (43) Pub. Date: Mar. 17, 2016 (54) SYSTEMAND METHOD FOR A SEMI-LIT Publication Classification MARKET (51) Int. Cl. (71) Applicant: IEX Group, Inc., New York, NY (US) G06Q 40/04 (2012.01) (52) U.S. CI. (72) Inventors: Bradley Katsuyama, New York, NY CPC ..…. G06Q 40/04 (2013.01) (US); Daniel Aisen, New York, NY (US) (57) ABSTRACT A number of techniques for improving electronic trading are disclosed. According to some embodiments, an electronic (21) Appl. No.: 14/488,886 trading system may selectively disclose to, or withhold from, trade participants order book data depending on whether each participant’s trade order meets a predetermined threshold (22) Filed: Sep. 17, 2014 price and/or threshold size or other criteria. TLL Example: Reallocation via TLL Portal Patent Application Publication Mar. 17, 2016 Sheet 1 of 36 US 2016/0078538 A1 Patent Application Publication Mar. 17, 2016 Sheet 2 of 36 US 2016/0078538 A1 Patent Application Publication Mar. 17, 2016 Sheet 3 of 36 US 2016/0078538 A1 <:/ºnawae?N=nº |×a-suaxovwaavi@ Patent Application Publication Mar. 17, 2016 Sheet 4 of 36 US 2016/0078538 A1 Patent Application Publication Mar. 17, 2016 Sheet 5 of 36 US 2016/0078538 A1 Patent Application Publication Mar. 17, 2016 Sheet 6 of 36 US 2016/0078538 A1 ?ez.sv:etuagopuepiaisegieuogeN Patent Application Publication Mar. 17, 2016 Sheet 7 of 36 US 2016/0078538 A1 try Patent Application Publication Mar. 17, 2016 Sheet 8 of 36 US 2016/0078538 A1 qOZI"zda?u30eqed 575?TdepuÔ(þannog) Patent Application Publication Mar. 17, 2016 Sheet 9 of 36 US 2016/0078538 A1 60Z Patent Application Publication Mar. 17, 2016 Sheet 10 of 36 US 2016/0078538 A1 ?sneg) Patent Application Publication Mar. 17, 2016 Sheet 11 of 36 US 2016/0078538 A1 Patent Application Publication Mar. 17, 2016 Sheet 12 of 36 US 2016/0078538 A1 Patent Application Publication Mar. 17, 2016 Sheet 13 of 36 US 2016/0078538 A1 36TG eqeq*. 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[0008] Existing electronic trading platforms also lack an CROSS-REFERENCE TO RELATED efficient mechanism to help brokers or brokerage firms miti APPLICATIONS gate risks in certain situations when they have to take on risky [0001] The present application is related to PCT Interna positions in providing services to their investor clients. Many tional Application No. PCT/US13/59558, filed Sep. 12, 2013, such services and related trades are still handled manually titled “TRANSMISSION LATENCY LEVELING APPA and/or on an ad hoc basis, potentially exposing the brokers or RATUSES, METHODS AND SYSTEMS,” which claimed brokerage firms to market risks longer than necessary. priority to U.S. Provisional Application Nos. 61/700,094 [0009] In view of the foregoing, it may be understood that (filed Sep. 12, 2012), 61/753,857 (filed Jan. 17, 2013), there are significant problems and shortcomings associated 61/758,508 (filed Jan. 30, 2013), and 61/876,200 (filed Sep. with current tools and methods for electronic trading. 11, 2013). All of the above-referenced patent applications are incorporated herein by reference in their entireties. SUMMARY OF THE INVENTION [0002] This application for letters patent contains material [0010] To overcome the above-mentioned and other prob that is subject to copyright, mask work, and/or other intellec lems and shortcomings in the prior art, the present application tual property protection. The respective owners of such intel discloses a number of techniques for improving electronic lectual property have no objection to the facsimile reproduc trading. tion of the disclosure by anyone as it appears in published [0011] According to some embodiments of the present Patent Office file/records, but otherwise reserve all rights. invention, an electronic trading system may selectively dis close to, or withhold from, trade participants order book data FIELD OF THE INVENTION depending on whether each participant’s trade order meets a predetermined threshold price and/or threshold size or other [0003] The present inventions disclosed herein relate gen parameter(s). erally to apparatuses, methods, and systems for electronic [0012] The present invention will now be described in more trading and/or auction. More particularly, the present inven detail with reference to exemplary embodiments thereof as tions relate to a system and method for a semi-lit market. shown in the accompanying drawings. While the present invention is described below with reference to exemplary BACKGROUND OF THE INVENTION embodiments, it should be understood that the present inven [0004] Consumers use auction-based systems to bid for and tion is not limited thereto. Those of ordinary skill in the art offer goods of value. Such auction-based systems can include having access to the teachings herein will recognize addi an online shopping site, an online ticket booking system, tional implementations, modifications, and embodiments, as electronic market, or any other trading exchange. well as other fields of use, which are within the scope of the [0005] In the field of financial investments, individual present invention as described herein, and with respect to investors and traders can buy or sell securities (such as stocks which the present invention may be of significant utility. and bonds), foreign currencies, and financial derivative prod ucts over an electronic trading platform. Well known elec BRIEF DESCRIPTION OF THE DRAWINGS tronic trading platforms, such as NASDAQ, NYSE Arca, [0013] In order to facilitate a fuller understanding of the Globex, London Stock Exchange, BATS Direct Edge, Chi-X present invention, reference is now made to the accompany Global, TradeWeb, ICAP and Chicago’s Board of Trade, ing drawings, in which like elements are referenced with like provide virtual marketplaces comprising an information tech numerals. These drawings should not be construed as limiting nology infrastructure for buyers and sellers to bid on financial the present invention, but are intended to be exemplary only. instruments. Typically, a trader submits a bid to an electronic trading platform via an electronic terminal such as a personal [0014] FIGS. 1A-1B provide an illustrative example show computer user interface; and the electronic trading platform ing aspects of resting order reallocation in accordance with transmits bid and askinformation that reflects real-time pric embodiments of the present invention. ing of a financial instrument via a communication network to [0015] FIG. 1C provides an illustrative example showing computer terminals of different trading entities. aspects of market checks for rest order fulfillment before [0006] There have been efforts made in the financial com order routing in accordance with embodiments of the present munity to improve the efficiency and fairness of electronic invention. trading systems at market centers and exchanges such that the [0016] FIG.