Securities Trading Interface with Multi-Level Order Book Display
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Solution Overview
Problem
Existing electronic securities trading systems lack the functionality to facilitate high-volume trading of fixed income securities with low error rates and provide traders with enhanced options for executing trades, particularly in the secondary market where liquidity and price transparency are limited.
Innovation Solution
A computer-implementable securities trading program that displays multiple bids and offers on a single screen, allowing traders to execute transactions by hitting or taking multiple bids or offers simultaneously, offering price improvement options, and enabling traders to spread trades across different instruments.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If open outcry auction system is used, then price determining mechanism is provided, but trading capacity is limited and error rate increases as trading volumes increase
Solution Approach 1:
The patent replaces the mechanical open outcry auction system with an electronic trading system. The electronic system automatically matches bids and offers, processes trades, and maintains market data, eliminating the need for manual vocal bids and offerings. This substitution enables high-volume trading while reducing errors through automated processing and digital record-keeping.
Solution Approach 2:
The patent creates a digital copy of the market order book, displaying all active bids and offers in an electronic format. This digital representation allows traders to view complete market depth without physical presence, enabling remote participation and automated trade execution while maintaining full market transparency.
2Loss of information
If open outcry auction system is used, then marketplace is provided, but price transparency is limited to vocalized orders only
Solution Approach 1:
The patent displays a complete digital copy of the order book showing all active bids and offers at multiple price levels. This electronic copy provides full price transparency by revealing the entire depth of the market, not just the top vocalized orders. Traders can see all levels of interest in the market through the electronic display.
Solution Approach 2:
The patent adds the dimension of electronic display to the traditional one-dimensional vocal auction system. By presenting market data across multiple visual levels and price tiers on a screen, the system transforms limited price transparency into comprehensive market visibility, allowing traders to perceive the full order book structure.
3Productivity
If electronic trading system displays multiple bids and offers on single screen, then trading efficiency is enhanced, but device complexity increases
Solution Approach 1:
The patent segments the trading interface into distinct visual elements: bid columns, offer columns, price levels, and trade execution areas. This segmentation organizes complex market data into manageable sections, allowing traders to efficiently process multiple bids and offers simultaneously without overwhelming confusion. The segmented layout enables rapid decision-making while maintaining system manageability.
Data Source
AI summary
Disclosed is a securities trading program for trading individual lots of a security which can be run at a security trader's computer station. The program generates a trading screen comprising a listing of multiple bids for the security, each bid having a price, as well as a listing of multiple priced offers for the security. The bid and offer listings are active, enabling the trader to hit any one of the displayed bids or take any one of the displayed offers, for example by selecting and clicking on a displayed bid or offer. In one embodiment, the bids and offers are arranged in side-by-side columns on the trader's screen, helping the trader to rapidly overview the market for a particular security, and compare different, possibly competitive, securities by paging through level-of-interest windows for each security. The invention's easily manipulated insights into market dynamics offers a sophisticated trader new opportunities to profitably exploit market niches, for example by browsing for attractive bids or offers on closely comparable securities.