The present invention relates to systems and methods for linking orders in electronic trading systems. More particularly, the present invention relates to systems and methods which enable traders to link trading of goods, services, financial instruments, and commodities in electronic trading systems.
In recent years, electronic trading systems have gained wide spread acceptance for trading of a wide variety of goods, services, financial instruments, and commodities. For example, electronic trading systems have been created which facilitate the trading of financial instruments and commodities such as stocks, bonds, currency, futures, oil, gold, pork bellies, etc. As another example, online auctions on the Internet have become popular markets for the exchange of services and both new and used goods. In one embodiment of systems for electronic trading of financial instruments, for example, a first trader may submit a “bid” to buy a particular number of 30 Year U.S. Treasury bonds at a given price. In response to such a bid, a second trader may submit a “hit” in response to the bid in order to indicate a willingness to sell bonds to the first trader at the given price. Alternatively, the second trader may submit an “offer” to sell the particular number of the bonds at the given price, and then the first trader may submit a “take” or “lift” in response to the offer to indicate a willingness to buy bonds from the second trader at the given price. In such trading systems, the bid, the offer, the hit, and the take (or lift) are collectively know as “orders”. Thus, when a trader submits a bid, the trader is said to be submitting an order.
Modern day trading includes not only the buying and selling of a single type of item, but also more complex transactions involving exchanges of a combination of the same or different types of items. For example, in a typical spread transaction, one bond may be sold and another bond may be purchased as part of a single transaction. The trading of combinations of items in this way facilitates arbitrage, hedging, and speculation.
However, because such combinations of items may have very complex relationships, there is a need to automate the trading of combinations of items. Thus, it is an object of the present invention to provide systems and methods for linking orders in electronic trading systems.