-United States Patent
`Gutterman et al.
`
`[191
`
`|||l||||l|||||Ill|||||IllllIlllllllllllllllllllllllllllllllllilllllllllllll
`US00529703 IA
`
`[11] Patent Number:
`
`5,297,031
`
`[45] Date of Patent:
`
`Mar. 22, 1994
`
`"StarLAN chosen to link Hutton branches", PC Week,
`May 12, 1987, c241, (abstract of article).
`to securities
`“Unisys: Unisys broadens commitment
`industry with snapnet back office administrative sys-
`tern", Nov. 7, 1989, article from Diaglog File 610—Busi-
`nesswire.
`Lyons, D. J. "Brokers tuning in to intelligent worksta-
`tions”, PC Week, vol. 4, Oct. 6, 1987, 187.
`“Stratus to use Apollo’s network computing system to
`link workstations, OLTP computers”, Apr. 26, 1988,
`article from Diaglog File 610-Businesswire.
`“SAEF 2. Product Overview,” (date unknown).
`1. Schmerken, “How Computer Assisted Trading is
`Making the Toronto Stock Exchange Purr," Wall Street
`Computer Review, (Dec. 1987) pp. 71-78, 97.
`Anon., “SOFFEX Management Summary,” Swiss Op-
`tions and Financial Futures Exchange Ltd. (1987).
`Primary Examiner—Roy Envall
`Assistant Examiner—-Frantzy Poinvil
`Attorney. Agent, or F1'rm—-Kirkland & Ellis
`[57]
`ABSTRACT
`
`'
`
`There is provided a broker workstation for managing
`orders in a market for trading commodities, securities,
`securities options, futures contracts and futures options
`and other items including: a device for selectively dis-
`playing order information; a computer for receiving the
`orders and for controlling the displaying device; and a
`device for entering the orders into the computer;
`wherein the displaying device comprises a device for
`displaying selected order information about each in-
`coming order, a device for displaying a representation
`of an order deck and a device for displaying a total of
`market orders. In another aspect of the invention, there
`is provided in a workstation having a computer, a de-
`vice for entering order information into the computer
`and a device for displaying the order information en-
`tered, a method for managing orders in a market for
`trading commodities, securities, securities options, fu-
`tures contracts and futures options and the like compris-
`ing the steps of: selectively displaying order information
`incoming to the workstation; accepting or rejecting
`orders corresponding to the incoming order informa-
`tion displayed; displaying accepted order information in
`’ a representation of a broker deck; and selectively dis-
`playing a total of orders at the market price.
`
`13 Claims, 8 Drawing Sheets
`
`[54] METHOD AND APPARATUS FOR ORDER
`MANAGEMENT BY MARKET BROKERS
`
`[75]
`
`Inventors: Burton J. Gutterman, Glencoe; John
`J. Brogan, Palatine; Thomas Palenik,
`Oak Forest; Dolores Panek, St.
`.
`Charles; Shirley Wu, Roselle. all of
`I11.
`
`[73] Assignee: Chicago Board of Trade, Chicago, Ill.
`
`[21] Appl. No.: 489,196
`
`[22] Filed:
`
`Mar. 6, 1990
`
`Int. Cl.’ .............................................. G06F 15/20
`[51]
`
`[52] U.S. Cl. ................
`364/408; 364/406
`[58] Field of Search ........................ 364/408. 412, 406
`
`[56]
`
`References Cited
`
`_U.S. PATENT DOCUMENTS
`4,677,552 6/1987 Sibley, Jr. ........................... 364/408
`4,760,527 7/ 1988 Sidley .......
`.. 364/412
`4,903,201
`2/1990 Wagner ........
`.. 364/408
`4,942,616 7/1990 Linstroth et al.
`.. 364/408
`4,980,826 12/1990 Wagner
`.. 364/408
`5,038,284 8/1991 Kramer
`.. 364/408
`5,101,353 3/1992 Lupien et al. ....................... 364/4-08
`OTHER PUBLICATIONS
`
`
`
`"Unisys introduces PC—based quotation system for
`stockbrokers at Securities Industry trade show in New
`York", Feb. 10, 1988, article from Dialog File 649-
`Newswire ASAP ®.
`“GTE Telenet and Reveal Software Inc. have cooper-
`ated in developing a complete broker’s workstation
`software package", Jan. 22, 1985, article from Diaglog
`File 649—Newswire ASAP ®.
`Bucken, M. “Stock traders ponder Make or Buy
`choice", Software Magazine, vol. 9, No. 15, Dec. 1989,
`75-77. (abstract of article).
`Mazzelia, D. P. “Workstations for financial services
`professionals”, Wall Street Computer Review, vol. 3, No.
`8, May 1986, 51-58 (abstract of article).
`Nathans, L. “Can computers help Merrill take posses-
`sion of the field?", Wall Street Computer Review, vol. 3,
`No. 5, Feb.‘ 1986. 35-39 (abstract of article).
`-
`“Software alliance unveils system to help banks trad
`securities", American Banker. Nov. 17, 1987, 14 (ab-
`stract of article).
`
`
`
`TS 1004
`
`1
`
`TS 1004
`
`

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`U.S. Patent
`
`Mar. 22, 1994
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`Sheet 1 of s
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`5,297,031
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`U.S. Patent
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`H Mar. 22, 1994
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`Sheet 8 of s
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`FIG. 30
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`START
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`INCOMTNG
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`METHOD AND APPARATUS FOR ORDER
`-MANAGEMENT BY MARKET BROKERS
`
`BACKGROUND OF THE INVENTION
`
`invention relates to computer-based
`The present
`techniques for managing orders placed in a physical
`market for trading instruments such as stocks, bonds,
`7 stock options, futures options and futures contracts on
`commodities including agricultural products, financial
`instruments, stock market indices and the like.
`A futures contract is an agreement providing for the
`future delivery of a fixed quantity of a commodity
`under conditions specified by a federally designated
`exchange. In general, that contract is a firm legal agree-
`ment between a buyer and seller to make or take deliv-
`ery of the underlying commodity and is cleared by a
`separate clearinghouse.
`The futures exchanges house centralized auction mar-
`kets (called designated contract markets) where" stan-
`dardized contracts for future delivery of specified quan-
`tities of commodities are bought and sold by open out-
`cry. The open outcry method of auction trading is
`widely believed to be the best method of buying and .
`selling goods because of the fast access to the market it
`provides to all prospective traders. It is important to
`note that the exchanges themselves do not tradefutures
`contracts, nor do they set prices at which contracts are
`traded. They merely furnish a place where market par-
`ticipants and their brokerage representatives can meet
`to trade futures contracts.
`
`Trading generally takes place in a pit or around the
`outside of a ring. All orders received by exchange mem-
`ber firms are transmitted to the exchange floor for exe-
`cution and are filled according to bids and offers in the
`respective pits by open outcry to all members present at
`the time. Only one instrument or commodity is traded in
`a pit or around a ring unless the volume is too small to
`justify so much space. Customarily, those trading the
`same contract delivery month gather in the same area of
`the ring or on the same step of the pit so that a broker
`with an order can locate the particular market as
`quickly as possible.
`Transactions on the trading floor must be reported to
`the membership and the general public. This is accom-
`plished through a variety of communications systems
`by the "various exchanges. Transaction information is
`typically entered by exchange-employed market report-
`ers in each trading pit and is accessible through com-
`puter terminals and electronic wallboards on each trad-
`ing floor. At present the open outcry auction in the pit
`produces a large quantity of information which must be
`recorded accurately and quickly by hand.
`At the end of each day the clearing house, which may
`be a subsidiary of the exchange or an independent en-
`tity, assumes one side of all open contracts: the clearing
`house becomes the buyer to each seller of a futures
`contract, and a seller to each buyer. The clearing house
`guarantees its members the performance of both sides of
`all open contracts.
`Other aspects of the commodity markets are treated
`in the literature, which includes Kaufman. “Handbook
`of Futures Markets,” John Wiley & Sons, New York
`(1984); Rothstein, “The Handbook of Financial Fu-
`tures,” McGraw Hill Book. Company, New York
`(i984); Gould, “The Dow Jones-Irwin Guide to Com-
`modities Trading," Dow Jones-Irwin, Homewood
`(1981); Gas & Yarney, "The Economics of Futures
`
`2
`Trading," John Wiley & Sons (l976); Johnson & I-lazen,
`“Commodities Regulation,” Little, Brown and Com-
`pany, Boston (1989); R. Teweles et al., “The Commod-
`ity Futures Game,” McGraw-Hill, New York (1974); T.
`Hieronymus, “Economics of Futures Trading," Com-
`modity Research Bureau,
`Inc., New York (1971);
`“Commodity Trading Manual,” Chicago Board of
`Trade, Chicago (1989); and J. Schwager, “A Complete
`Guide to the Futures Markets," John Wiley & Sons,
`New York (1984).
`Floor traders are generally classified in two ways: (1)
`speculators, or “locals”, buy and sell for their own
`accounts; and (2) floor brokers fill orders for commis-
`sion houses, producers and processors seeking to lock in
`a price for their products. Unless a trader is a member of
`an exchange, it is necessary for the trader to deal on the
`exchange through a member brokerage firm. Normally,
`firms that handle public business (the “commission
`houses”) must be registered as “Futures Commission
`Merchants”, or "FCMs." A “local” can take long-term
`positions (i.e., weeks or months) or “scalp” over very
`short periods (liquidating positions within seconds or
`minutes of entering the transactions). He may trade in
`one or more pits. I-‘le benefits from the speed with which
`he can take or liquidate positions, but this is in itself no
`assurance of a profit. Some floor traders specialize in
`spreads by taking opposite positions between future or
`options when the price difference appears abnormal.
`Floor traders have the advantage of lower transaction
`costs available to all members of exchanges.
`The floor traders who execute orders for others but
`seldom or never trade for themselves are the brokers
`who may specialize in orders from customers such as
`commercial processors, exporters, financial institution
`commodity trading funds and the like. They may re-
`ceive only a small percentage of the commissions paid
`by the customer to his commission house, but the com-
`mission revenues may be substantial depending on the
`volume of business. The orders held by a floor broker at
`any given time are referred to as his “deck.” He is al-
`lowed to trade for his own account if he chooses, but he
`can not use the public orders to benefit his own trading.
`When a registered representative‘ of the commission
`house receives an order from a customer, the represen-
`tative sends the order to the commission house's order
`desk on the trading floor, where it is usually handed to
`a messenger and taken directly to anqappropriate broker
`in the trading pit or ring. Once the broker in the trading
`pit has the order, he typically uses voice and hand sig-
`nals to announce his bid or offer price, the delivery
`month, and the quantity to be bought or sold. Once the
`order has been executed, it is carried by messenger back
`to the commission house’s order desk on the trading
`floor, and the confirmation of the order is dispatched
`back to the office where it was initiated. The represen-
`tative then usually telephones the confirmation to the
`customer or hands him a confirmation slip if he is pres-
`ent in the office.
`_
`The communication of orders from the registered
`representative to the order desks on the trading floor '
`takes place with great speed. All orders are time-
`stamped at various stages along the order route as a
`check that the order is being expedited in the best possi-
`ble fashion. Increasingly, this process is performed by
`computerized communications systems which start
`with a terminal used by the registered representative
`and end with a printer near the broker. Often the com-
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`puter simultaneously records the terms of the order for
`later use in preparing statements for the registered rep-
`resentative and his customer.
`'
`The floor brokers’ stock in trade is their skill in exe-
`
`cuting the orders they receive and accept. They must
`decide, instantly, the tactics that will be most effective
`in filling a given order: whether to wait for bids or
`offers, or whether to hold with the current price, or to
`bid up or offer down promptly. To be effective, they
`must know the pit: who will do how much at what
`price. They must read the intentions of scalpers, locals
`and other brokers while concealing their own inten-
`tions.
`
`One of the skills of a broker is in knowing his deck.
`As described above, the deck is a stack of orders that
`are to be executed by the broker. The orders are typi-
`cally written on pieces of paper about five by seven
`inches which are then arranged by the broker in a se-
`quence for execution as the market price moves up or
`down. The broker usually folds them for concealment
`and puts them in his pocket so that his hands will be free
`to signal and to handle his trading card and pencil.
`Occasionally, the decks are as much as an inch thick and
`require great memory skill and anticipatory planning.
`Perhaps the most common type of order is the “mar-
`ket order” in which the customer states how many
`contracts of a given delivery month he wishes to buy or
`sell. He does not specify the price at which he wants to
`initiate the transaction but simply wants it placed as
`soon as possible at the best possible price.
`“Contingency orders” are those that impose certain
`limitations beyond the quantity and delivery month,
`such as limits in price or time, or both. A “price limit
`order” contains a price limitation that is specified by the
`customer; it can be executed only at the price specified
`or at a better price level. A “fill or kill” order contains
`a specified price at which the order must be executed or
`it is to be immediately cancelled.
`“Stop orders” are sometimes confused with “limit
`orders", but they are actually quite different. A “buy
`stop order" instructs a broker to execute the order when
`the price of a commodity rises to a specified level above
`the current market price. The “buy limit order” is usu-
`ally placed below the current market price and must be
`executed at the limit price or better. The difference
`between a buy limit order and a buy stop order is exem-
`plified as follows. A customer may be inclined to buy
`December sugar, which could be selling at a price of
`5.43 cents per pound. The customer could tell his bro-
`ker to buy a contract at a price not to exceed 5.35 cents;
`this is a “buy limit order”. Another customer under the
`same circumstances could tell his broker to buy a con-
`tract of December sugar but not until the price rises to
`at least 5.55 cents, at which point the order will be
`executed at the market; this is a “buy stop order". The
`buy stop order is placed above the current market and
`may be executed at the price specified on the stop,_
`above it, or below it because it is executed at the market
`price after the stop price is touched; at that point, the
`stop is said to be “elected”.
`A “sell stop order” instructs a broker to execute an
`order when the price falls to a given level, at which
`point it is to be executed at the market price. Unlike a
`typical “sell limit order”, the sell stop order is below the
`current market price and may be executed at a price at,
`above, or below the specified stop price when it is
`elected.
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`Some customers will raise their stop prices as the
`market price advances in an effort to gain as much as
`possible from a major move, while making certain that
`they can probably lose back only a little of the gain.
`Such an order is frequently called a “trailing stop".
`A somewhat more complex order is the “stop limit
`order”. The customer might instruct his broker not to
`buy sugar until it rises to 5.53 cents per pound and not
`to pay more than 5.55 cents. This is unlike the unlimited
`stop, which becomes a market order when the stop
`price has been touched. The limit price may be the same
`or different from the specified stop.
`A “market-if-touched (M.l.T.) order" is like a limit
`order, but the M.I.T. order is executed at the market
`when the market has traded at the price specified on the
`order, and so it may be filled either at that specified
`price, above it, or below it. M.I.T. orders are sometimes
`called “board orders". The order may be entered for
`one day, a specified period, or open (i.e., good until
`cancelled).
`Sometimes a customer may wish to take a position
`within a short time but would like the broker on the
`floor of the exchange to use some of his personal judg-
`ment in the timing of the fill. The broker could do this
`if the order indicates that he is to fill it at the market but
`is to take his time and will not be responsible if by wait-
`ing too long or not waiting long enough the price is
`unsatisfactory to the customer. Such orders may be
`marked “not held". Customers may also specify the
`time at which they wish their orders filled, e.g., “on
`opening," “on close,” or at a particular specified time.
`“Altemative orders” provide for one of two possible
`executions: a customer may order 5,000 bushels of corn
`at $1.45 a bushel and 5,000 bushels of wheat at $2.56 a
`bushel, but not want both. A far more common example
`of the alternative order is the placing of an objective
`and a stop, with instructions to cancel one if the other is
`filled; for example, having bought one contract of soy-
`bean oil at 14.50 cents a pound, a customer may order
`his broker to sell the oil either at 14.95 or 14.25 cents
`stop, whichever occurs first, and then immediately can-
`cel the remainder of the order to avoid inadvertently
`reversing his position.
`“Scale orders” are used to establish or liquidate posi-
`tions as the market moves up or down. The sugar trader
`may instruct his broker to buy a contract of sugar at
`5.45 cents and another contract each time the price
`drops five points from that level until he has accumu-
`lated six contracts. When he sells out his position, he
`may order the broker to sell one contract at 5.70 cents
`and another contract each time the price rises five
`points until his six contracts have been sold.
`“Contingent orders" are filled by the broker after the
`price of another contract or even another commodity
`reaches a specified level.
`“Spreads” may be established at a fixed difference
`rather than at specified prices because the spreader is
`concerned only with the difference rather than the
`level. He may therefore order his broker to “buy one
`July pork bellies and sell one February bellies at 80
`points difference or more, premium February.” Such an
`order could be used to establish a new spread position,
`which the trader believes will narrow, or to take the
`profit in a position at a narrower difference and be
`satisfied with the profit at 80 points difference.
`Although the foregoing description has concentrated
`on the commodity futures markets, it will be understood
`that the order management system of the present inven-
`
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`5
`tion is applicable to all markets, including those for
`securities trading. Securities markets are usually based
`on actions by specialists, each of whom is the market
`maker for one or more specific securities. In the New
`York Stock Exchange, for example, the ultimate deter-
`mination of price for any given transaction frequently is
`determined by a specialist who deals in a particular
`stock and who maintains a running list or "boo ” of
`offers to sell and orders to purchase that stock. The
`specialist may complete a transaction in the stock when-
`ever one or more purchase and sell orders can be
`matched with respect to price; on occasion, the same
`specialist purchases the particular stock in which he
`specializes or sells the same stock in order to maintain a
`market for the stock and prevent violent fluctuations in
`its price. Similar functions, particularly with respect to
`the matching of orders to purchase and to sell, must be
`carried out in all auction markets for the marketing of
`fungible goods, including such commodities as wheat,
`corn, and the like as well as stocks and bonds.
`A computation system for establishing prices in auc-
`tion trading’ for the securities market is described in U.S.
`Pat. No. 3,581,072 to Nymeyer. That computation sys-
`tem comprises a main data store for recording encoded
`data items representative of orders to buy and to sell the
`goods, such orders including orders at specific prices
`and other orders "at the market.” The system includes a
`buy order sequencing device for arranging and record-
`ing purchase offers frrsttin descending order by price
`and secondly by time of entry so that at each price level
`the oldest orders are uppermost. A sell order sequenc-
`ing device is provided for arranging and recording all
`offers to sell first in ascending order by price and se-
`condly in descending order by time so that once again
`the oldest orders‘ are the highest at each price level. A
`closing price store is provided to record the last actual
`selling price for the goods. The closing price store and
`the main data store are coupled, by suitable control
`means, to the sequencing devices in order to transfer the
`recorded data items from the data store to the sequenc-
`ing devices with “at market” prices being transferred at
`the aforementioned last selling price. The two sequenc-
`ing devices are coupled to a comparator that compares
`the sell orders and the buy orders, when they have been
`arranged in sequence,
`to determine the lowest buy
`order price that is equal to or greater than a recorded
`sell order and thus establish a new selling price for the
`goods.
`' More than such a system for merely matching buy
`and sell orders, the present invention provides a system
`that allows brokers to manage their decks and to im-
`prove the accuracy of communications between the
`trading floor and the customers. The present invention
`can also reduce the back office costs to trading firms by
`reducing the volume of paperwork and consequent
`errors.
`
`SUMMARY OF THE INVENTION
`
`In accordance with the present invention, there is
`provided a broker workstation for managing orders in a
`market for trading commodities, securities, securities
`options, futures contracts and futures options and other
`items. comprising: means for selectively displaying
`order information; a computer for receiving the orders
`and for controlling the displaying means; and means for
`entering the orders into the computer; wherein the
`displaying means comprises means for displaying se-
`lected order information about each incoming order,
`
`'
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`means for displaying a representation of an order deck
`and means for displaying a total of market orders.
`In another aspect of the invention, there is provided
`in a workstation having a computer, means for entering
`order information into the computer and means for
`displaying the order information entered, a method for
`managing orders in a market for trading commodities,
`securities, securities options, futures contracts and fu-
`tures options and the like comprising the steps of: selec-
`tively displaying order information incoming to the
`workstation; accepting or rejecting orders correspond-
`ing to the incoming order information displayed; dis-
`playing accepted order information in a representation
`of a broker deck; and selectively displaying a total of
`orders at the market price.
`BRIEF DESCRIPTION OF THEIDRAWINGS
`
`The features and advantages of the present invention
`will be better understood after a reading of the follow-
`ing detailed description in conjunction with the draw-
`ings in which:
`FIG. 1a shows a block diagram of a portion of an
`apparatus in accordance with the present invention;
`FIG. 1b shows an embodiment of other portions of an
`apparatus in accordance with the present invention;
`FIGS. 2a, 2b, 2c and 2:! show display partitions in
`accordance with present invention; and
`FIGS. 3 and 3a show functional block diagrams of
`the broker workstation instructions.
`
`DETAILED DESCRIPTION OF THE
`INVENTION
`
`The broker workstation in accordance with the pres-
`ent invention is an electronic replication of the broker’s
`management of the orders in his deck. The broker has
`the ability to manage his deck just as he has today in the
`pits, but more effectively. The present invention facili-
`tates the rapid organization, presentation and exchange
`of large amounts of order information to a broker with-
`out requiring a physical order deck.
`As described further below, orders can be entered
`into the workstation in two ways. The order may be
`entered directly to the workstation via an electronic,
`order entry system, or it may be entered manually when
`brought to the pit by a messenger or other signalling.
`For best utilization of an electronic market trading sys-
`tem such as that described in co-pending U.S. patent
`application Ser. Nos. 07/322,985 and 07/329,866, the
`orders are preferably entered by way of the electronic
`order entry system.
`The broker workstation in ‘accordance with the pres-
`ent invention allows the broker to manage the FCMS’
`orders more efficiently and to handle order accep-
`tances, fill reports and cancel confirmations more effec-
`tively. When used with an electronic order entry sys-
`tem, the broker workstation enables the broker to com-
`municate information as to the status of the orders he is
`working. Therefore, the FCM can track the orders
`from the time they are entered into the electronic order
`entry system until the time the orders are returned. The
`broker workstation can also feed information directly to
`the customer and clearing house via the electronic
`order entry system of the exchange. The audit trail is
`thus enhanced for. the FCMS, the broker and the ex-
`change. From the improved procedures provided by
`the present invention, savings in the form of reduced
`staff and reduced errors due to manual handling of
`paper orders.can also be expected.
`
`12
`
`12
`
`

`
`5,297,013 1
`
`7
`The broker workstation in accordance with the pres-
`ent invention is a deck management system that contin-
`ues to permit the broker to use his expertise to execute
`the order depending on the market situation. The bro-
`ker has indicated on his workstation the different types
`of orders residing in his deck, including the total quan-
`tity at a price of limit orders, stops, stop limits, M.I.T.s,
`and orders with special instructions. There is also an
`area indicating the total market orders to buy and sell.
`Just as in the present markets, the broker must judge
`how to get the best order execution, whether that is in
`the physical pits or on an electronic trading system. The
`system of the present invention thus enables the broker
`to better serve the needs of the market.
`Referring now to the Figures in which like reference
`numerals indicate like parts throughout, FIG. 1a shows
`a block diagram of an apparatus in accordance with the
`present invention comprising a broker workstation 10.
`As described in more detail below, the broker worksta-
`tion 10 may advantageously be a MICROEXPLORER
`processor, made by Texas Instruments Inc., that in-
`cludes a MACINTOSI-l II computer, manufactured by
`Apple Computer, Inc., having a high-resolution (e.g.,
`350 dots per inch), color, touch-sensitive display screen.
`Suitable touch-sensitive screens are made by Apple
`Computer, Inc, and it will be appreciated that many
`other suitable devices are commercially available. One
`embodiment of a broker workstation 10 is illustrated in
`FIG. 1b which shows a high-resolution display screen
`12, a keyboard 14 and an auxiliary control device 16,
`such as a trackball or mouse. It will be understood by
`those of ordinary skill in the art to which the present
`invention pertains that the various keys and touch-sensi-
`tive screen functions can also be implemented by a
`conventional keyboard, mouse and other standard input
`devices.
`
`The workstation 10 carries out a plurality of instruc-
`tion modules that can be written in any suitable com-
`puter language, such as LISP, PASCAL and C, al-
`though LISP is preferable because of the flexibility it
`provides. In addition, the broker workstation 10 shown
`in the block diagram of FIG. 1a is representative of a
`plurality of broker workstations that may be operational
`simultaneously.
`A workstation receiver module 18 receives suitable
`communications from an electronic order entry system
`and price reporting system that are provided by the
`exchange and are electronically connected to the work-
`station 10 by a suitable link 20. The receiver module 18
`is thus a port into the workstation 10, which may be
`activated initially by an attempt at connection by the
`order entry system. It will be understood that connec-
`tion of the workstation 10 to an electronic price report-
`ing system would be made in a manner substantially
`similar to the connection to the electronic order entry
`system and that the communication link 20 may com-
`prise any of the well known hard-wired, radio-fre-
`quency or optical technologies.
`In operation,
`the workstation receiver module 18
`receives orders and other information directed to the
`workstation and electronically attaches or associates
`that information with a time of receipt indication. Such
`time stamping is important for audit and integrity func-
`tions of the system, as well as for carrying out order-
`matching features of some types of trading system. The
`received order and time-stamp are then stored tempo-
`rarily in a workstation—in queue 22 in the workstation
`receiver module 18, and the module 18 causes the work-
`
`station 10 to send an acknowledgment of receipt to the
`transmitting order entry system. In some situations, the
`workstation receiver module 18 would cause the work-
`station 10 to send a not-acknowledged message to the
`order entry system so that the information could be
`retransmitted. Such situations would typically occur
`when the workstation-in queue 22 is temporarily full or
`when an error in the format of the information occurs,
`such as might arise from a noisy communication link.
`The workstation receiver module 18 receives the
`information from the order entry system and places it in
`the workstation-in queue 22 in a predetermined time
`sequence. The receiver module 18 thus could advanta-
`geously arrange for processing of information from an
`electronic order entry system before processing of in-
`formation entered by band despite the earlier receipt of
`the hand-input information. For example, orders from a
`trader in Japan could be presented to a Chicago-located
`broker workstation before orders flashed by hand from
`a Chicago trader to the broker are processed. In this
`way, communications link delays could be compensated
`by the system so that the system access time is equal for
`all traders, but such access time equalization is not es-
`sential to the present invention. It will be appreciated
`that such delay compensation would not be expected in
`applications in which the workstation 10 received or-
`ders through a plurality of different electronic order
`entry systems used by different FCMS. In addition, the
`receiver module 18 can implement the features of the
`present invention for organizing information in price
`and time sequences as in stock-exchange and other
`types of trading system.
`After time-stamping the received information, the
`workstation receiver module 18 places the infomiation
`in the workstation-in queue 22, such as a FIFO buffer,
`and transmits an acknowledgement message to the
`order entry system. If the workstation-in queue 22 is full
`or if an error in the information is detected by the work-
`station receiver module 18, the module 18 transmits a
`not-acknowledged message to the order entry system.
`The workstation receiver module 18 also handles an
`“alive” or “heartbeat” message from the workstation 10
`to the order entry system in the event of little market
`activity.
`Information in the workstation-in queue 22 is re-
`moved by a workstation transaction processor 24 which
`time-stamps the information and updates the worksta-
`tion’s display screen and database, which may be stored
`on a hard disk memory, in accordance wit