Multi-tier Entity Matching for Security Share Reassignment
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Solution Overview
Problem
Existing systems for reassigning security share data structures lack efficiency in creating liquidity for historically illiquid assets like private equity and real assets, as they struggle to effectively match offers between participants and manage obligations in a multi-tiered framework.
Innovation Solution
A machine platform with processing circuitry and a database executes a tri-tier matching algorithm to reassigned security share data structures based on participant categories, prioritizing matches and obligations to enhance liquidity and efficiency in reassignment processes.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If a multi-tier matching algorithm is implemented to prioritize participant categories, then the efficiency of reassigning security share data structures is improved, but the device complexity increases
Solution Approach 1:
The matching algorithm is segmented into three distinct tiers based on participant category priority. First-tier participants (sponsored entities) are matched first, followed by second-tier participants (non-sponsored entities), and finally third-tier participants (other entities). This segmentation allows the system to efficiently prioritize reassignments while maintaining manageable complexity through structured hierarchical processing.
Solution Approach 2:
The system changes the parameter of participant priority by assigning different tier levels (first-tier, second-tier, third-tier) to different participant categories. This parameter change enables the matching algorithm to efficiently prioritize reassignments based on entity type without requiring complex custom logic for each participant, thereby improving productivity while controlling complexity.
2Productivity
If real-time matching is performed for all offers, then the liquidity generation is improved, but the loss of time for processing increases
Solution Approach 1:
The system performs preliminary actions by pre-categorizing participants into tiers and pre-establishing matching priorities before actual reassignment requests are processed. This preliminary structuring allows real-time matching to proceed efficiently without requiring complex runtime decisions, thereby generating liquidity quickly while minimizing processing time loss.
Solution Approach 2:
The matching process is segmented into discrete tier-based stages, where first-tier matches are processed separately from second-tier and third-tier matches. This segmentation enables parallel processing of different participant categories, improving overall liquidity generation speed while reducing the time loss associated with sequential processing of all offers.
3Measurement precision
If participant category information is stored and processed, then the precision of matching is improved, but the quantity of data to be managed increases
Solution Approach 1:
The system applies local quality by storing and processing only the specific participant category information necessary for each tier level. First-tier participants are identified by their sponsored entity status, second-tier by their non-sponsored status, and third-tier by other characteristics. This localized data storage approach improves matching precision without requiring management of excessive data volumes.
Solution Approach 2:
The participant category information serves multiple functions: it determines matching priority, identifies eligible participants for specific tiers, and enables the system to handle different participant types through a unified multi-tier framework. This multi-functionality allows precise matching while minimizing the quantity of data that needs to be managed, as the same category information drives multiple aspects of the matching process.
Data Source
AI summary
A system includes processing circuitry communicatively coupled to a plurality of terminals and a database that includes a first data structure that identifies a plurality of participant entities and that associates each of at least a subset of the participant entities with participant category information, by which the processing circuitry is configured to identify each of the participant entities as being one of three participant category entities, a second data structure that identifies assignable share data structures and respective ones of the plurality of participant entities to which the share data structures are assigned, and a third data structure that identifies offers of the participant entities to unload one or more of the share data structures assigned to the offering participant entities, and offers of the participant entities to obtain assignment of one or more of the share data structures, offers being matched according to a three-tier paradigm.