System and Method for Processing Quotes Using an Integrated Circuit

Abstract

Systems, methods, and computer programs for receiving and processing messages for a financial exchange comprising a matcher server integrated circuit such as an FPGA or ASIC component configured to receive and process information associated with a financial instrument operatively connected to the matcher server, wherein the integrated circuit component is configured to receive and store a plurality of messages from at least one computer server, each message of the plurality of messages being comprised of at least one message type.

Description

BACKGROUND[0001]1. Field of the Related Art[0002]Disclosed are systems and methods for receiving and processing messages by a financial exchange.[0003]2. Background Discussion[0004]Modern financial exchanges provide a marketplace where investors can buy and sell a variety of financial instruments. In the past, these markets operated by having brokers for buyers and sellers physically located on a trading floor with transactions conducted face-to-face. Because face-to-face transactions take place at a relatively slow pace, the speed at which orders and other messages are received at the exchange did not impact the liquidity or performance of the market, increasingly, financial exchanges conduct transactions within computerized systems where orders to buy and sell instruments takes place automatically.[0005]Markets also disseminate price information in the form of a market data feed. Price information consists of the best bid and offer price for each financial instrument bought or sol...

AI Technical Summary

Benefits of technology

The patent describes a system for processing messages from a financial exchange using an integrated circuit component. The integrated circuit component receives and stores information about financial instruments and market makers, including most recent prices and quotes. It can also generate market data based on the received information and send it to a matcher server. The system can also determine if there has been a change in the underlying market and send a notice to the matcher server. The technical effect of the patent is to provide a more efficient and automated system for processing financial instruments and market data.

Problems solved by technology

Options are particularly challenging for market makers because a very large number of instruments may be traded on a single exchange.

The number of Mass Quote messages that can be processed by ISE is limited by the speed of the servers and networks.

But when the stock market moves quickly, even this large capacity is not sufficient for the market makers to move all their quotes in all instruments.

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