US 2015008 1508A1 (19) United States (2) Patent Application Publication (10) Pub. No.: US 2015/0081508 A1 Schwall et al. (43) Pub. Date: Mar. 19, 2015 (54) TECHNIQUES FOR FACILITATING Publication Classification ELECTRONIC TRADING (51) Int. Cl. (71) Applicant: IEX Group, Inc., New York, NY (US) G06Q 40/04 (2012.01) (52) U.S. CI. (72) Inventors: John Schwall, Staten Island, NY (US); CPC ..…. G06Q 40/04 (2013.01) Matthew Norbert Trudeau, Brooklyn, USPC ..…. 705/37 NY (US) (73) Assignee: IEX Group, Inc. (57) ABSTRACT (21) Appl. No.: 14/487,320 A number of techniques for improving electronic trading are disclosed. According to some embodiments, a user portal (22) Filed: Sep. 16, 2014 may be provided in an electronic trading system for educa tional and informational purposes and also to assist investors Related U.S. Application Data in configuring their routing or trading preferences for elec (60) Provisional application No. 61/879,104, filed on Sep. tronic trading orders to be submitted to the electronic trading 17, 2013. system. TLL Example: Reallocation via TLL Portal Patent Application Publication Mar. 19, 2015 Sheet 1 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 2 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 3 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 4 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 5 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 6 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 7 of 31 US 2015/0081508 A1 dOd/Ïïjapio qOZI“Zda?u30eqeq Patent Application Publication Mar. 19, 2015 Sheet 8 of 31 US 2015/0081508 A1 ????(Iuapuo EOZT“Ida?u32eqeq qOZI"Zda?u30eqed Patent Application Publication Mar. 19, 2015 Sheet 9 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 10 of 31 US 2015/0081508 A1 Šuppig £8SS333 Patent Application Publication Mar. 19, 2015 Sheet 11 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 12 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 13 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 14 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 15 of 31 US 2015/0081508 A1 {{}{}{}·{{ Patent Application Publication Mar. 19, 2015 Sheet 16 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 17 of 31 US 2015/0081508 A1 Z?Ãue?3X3 CIGO9 Patent Application Publication Mar. 19, 2015 Sheet 18 of 31 US 2015/0081508 A1 I?Ãue?oxB eG09 Z?Ãue?OXE CIGO9 qOZ9ZJ??u30e?eG Patent Application Publication Mar. 19, 2015 Sheet 19 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 20 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 21 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 22 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 23 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 24 of 31 US 2015/0081508 A1 ??TI36essºu Patent Application Publication Mar. 19, 2015 Sheet 25 of 31 US 2015/0081508 A1 ; : i Patent Application Publication US 2015/0081508 A1 \ / Patent Application Publication Mar. 19, 2015 Sheet 27 of 31 US 2015/0081508 A1 = * N. ? i Patent Application Publication US 2015/0081508 A1 A \ ~ \ J / \ 2.Z \ | Patent Application Publication Mar. 19, 2015 Sheet 29 of 31 US 2015/0081508 A1 FIGURE 9 User Input º 975--- Qevice(s) 9 1 ; (3.g., Cell, : ;GPS, etc.): #9.74. : p i Client(s) User:) | 933b 933a Storage Device 9 34 TLE PLATFORM component 935 TLL Pi_ATFORM Database #|Mail: Server 9.2.1][Web Browser 918]\l.* - § 13|| *3 ||36 #[InfoServe gif|User:Interface JTF Hir- Operating System (OS) 9 15 ....................T.TITBAffößM digg?-------------- Memory.92; Patent Application Publication Mar. 19, 2015 Sheet 30 of 31 US 2015/0081508 A1 Patent Application Publication Mar. 19, 2015 Sheet 31 of 31 US 2015/0081508 A1 *****'& $$$$$$$$$$3 3&&#3333338, robe?uwonogalaisenbaenaendae ******:??? US 2015/008 1508 A1 Mar. 19, 2015 [0020) FIGS. 4A-4B provide exemplary user interface dia generate a set of instructions to help request tailored order grams of TLL in accordance with embodiments of the present routing and algorithm configurations from their broker(s). invention. [0031] In one implementation, a Point-of-Presence (POP) [0021] FIGS. 5A-5C provide exemplary data diagrams access point may be installed and configured to receive trad illustrating aspects of TLL network infrastructure in accor ing orders from market participants and pass on the orders to dance with embodiments of the present invention. a data exchange for execution; the transmission to and from [0022] FIGS. 6A-6H provide exemplary diagrams illustrat POP may lead to additional transmission latency, which may ing various scenarios of managing latency arbitrage and order be the location of the market participant (e.g., transmission book arbitrage via a network access point that causes addi distance, etc.), transmission medium (e.g., cable, microwave, tional data transmission latency in accordance with embodi etc.), circuit resistance, other information technology infra ments of the present invention. structure advantage and/or other transmission speed advan [0023] FIG. 7 provides a data flow diagram illustrating tage, and/or the like. For example, the length of the cable additional embodiments of the present invention. required to connect the POP and a data exchange or market [0024] FIGS. 8A-8D provide exemplary diagrams illustrat participant terminal may be utilized to create a transmission ing embodiments of binary search tree with worst-case-opti latency. Such transmission latency may be controllable by mized, time-deterministic insert, and search operations for a adjusting the length of the transmission cable. finite key space in accordance with embodiments of the [0032] In one implementation, the POP may comprise a present invention. piece of non-intelligent network hardware including at least [0025] FIG. 9 shows a block diagram illustrating example one communication link with an input port for receiving aspects of a TLL controller in accordance with one embodi orders, and another communication link with an output port ment of the present invention. for transmitting the received orders to a data exchange and/or [0026] FIG. 10A shows a flow chart illustrating an exem other entities. In another implementation, the POP may com plary method for assisting investors with their trade configu prise a computer readable medium storing computer execut rations in accordance with one embodiment of the present able instructions to perform a series of instructions by a invention. processor. [0027] FIG. 10B shows an exemplary instruction sheet with [0033] It should be noted that although the examples dis trade configurations according to one embodiment of the cussed herein often include market data centers and data present invention. exchanges for financial instrument trades, the TLL may be applied to any auction-based systems or electronic markets, DETAILED DESCRIPTION OF THE INVENTION such as, but not limited to trading exchanges or dark pools for securities, currencies, or other financial instruments, alterna Transmission Latency Leveling (TLL) & TLL Portal tive trading systems, Electronic Communication Networks [0028] Embodiments of the transmission latency leveling (ECNs), matching engines, advertising exchanges (display, technology (hereinafter “TLL”) provides an electronic trad mobile, radio, search, video, and/or the like), online flight ing order management infrastructure, such as a “point-of ticket/hotel booking systems, online auction shopping sys presence” or “POP” which receives and routes electronic tems, electronic markets, virtual world in-game markets such trading orders from different trading entities at a network as those found in massively multiplayer online role-playing access point via a transmission medium to create a certain games (MMORGs), and/or the like. amount of transmission latency before the trading orders [0034] Further, the TLL may be applied to any electronic could arrive at and be executed by electronic market centers to messaging systems where latency and/or access to resources reduce order book arbitrage that may be exploited by high is a consideration. For example, in an online video game frequency trading participants. The TLL/POP infrastructure where the speed at which players receive and submit mes may also impose some amount of transmission latency on sages determines how quickly they are able to understand and outgoing market data updates in order to reduce such unfair respond to conditions in the game, and where a player is able trade practices as latency arbitrage. to react and register actions ahead of other players, gains an [0029] In some implementations, the TLL allows an inves advantage that may resultin said player winning the game. As torto elect various order handling instructions from an appli such, the TLL may provide institutionalized fair access to cation (website, desktop, etc.) which then creates a custom information and resources with an auction-based system. specification (e.g., in accordance with Financial Information [0035) Typically, the market center or electronic exchange eXchange (FIX) protocol for electronic trading) such that served by the TLL/POP infrastructure do not receive trading those elections can be sent over any medium to a broker (or orders or execution instructions directly from investors but vendor). The instructional videos, behind a secure login (or have to receive the orders/instructions through the brokers or not), provide context for the order handling elections. The brokerage firms who may or may not be interested in or types of elections and/or order handling instructions could be capable of providing flexibility to the investors in order rout extensive, but minimally include order routing preference and ing or trading strategy.