Sean P O'Malley

US Patent:

20050216384, Sep 29, 2005

Filed:

Dec 15, 2003

Appl. No.:

10/736058

Inventors:

Daniel Partlow - Westport CT, US
Kam Haq - New York NY, US
Maria Mejevitch - Westport CT, US
Sean O'Malley - New York NY, US

International Classification:

G06F017/60

US Classification:

705035000

Abstract:

A system, method and computer program for creating and valuing financial instruments (including but not limited to futures, forwards, call options, put options, swaps, “swaptions”, and “op-swaps”) linked to published real estate indices. The present invention will be referred to in this application as a real estate index linked financial instrument, and is defined as a financial instrument whose value changes based on movements in underlying indices based on real estate prices. These indices are published by sovereign governments, government-chartered agencies and departments (such as Fannie Mae, Freddie Mac, Office of Management and Budget, and the Treasury Department in the U.S.), non-governmental organizations, commercial banks, investment banks, realty agencies and many other organizations. The instruments can be written, with a published index number from any real estate index or indices as the initial value upon which the financial instrument's terms are based. The predicted future value of the real estate index or indices will change in response to market buy/sell demand based on investor expectations of the predicted future value of the real estate index or indices related to one or more real estate index linked financial instrument(s). Thus, the predicted future value of the index or indices will change in response to the market demand as investors offer to buy and/or sell real estate index linked financial instruments which will be listed on securities exchanges and electronic commerce networks (ECNs) as well as over the counter (OTC) and in private transactions. Each predicted future index value will change based on the investor expectation of how strong demand will be for the underlying real estate market upon which each index or indices are based. Thus, the present invention gives investors a means of taking or adjusting positions upon price movements in local, city, regional, state, national, or multinational/international real estate markets. It is important to note that real estate index linked financial instruments can be created either in standardized contract sizes that can be traded on futures, options or other securities exchanges, ECNs and/or OTC, or can be customized to meet the specifications of a transactional counterparty which wishes to speculate on movements in local, city, regional, state, national, or multinational/international real estate prices. Such instruments may also be created from a plurality of indices, thus allowing an investor to package movements from several different real estate indices into a single financial instrument. Such instruments may also involve a combination of real estate index linked financial instruments, either with each other or with other financial instruments in a combination containing at least one real estate index linked financial instrument.

US Patent:

20060143099, Jun 29, 2006

Filed:

Sep 23, 2004

Appl. No.:

10/751086

Inventors:

Daniel Partlow - Westport CT, US
Kam Haq - New York NY, US
Maria Mejevitch - Westport CT, US
Sean O'Malley - New York NY, US

International Classification:

G06Q 40/00

US Classification:

705035000

Abstract:

A system, method and computer program for creating and valuing financial instruments (including but not limited to futures, forwards, call options, put options, swaps, “swaptions”, and “op-swaps”) linked to average credit spread information. The present invention will be referred to in this application as an average credit spread-linked financial instrument, and is defined as a financial instrument whose value changes based on movements in underlying average credit spreads. These average credit spreads may be calculated, or may already be published by sovereign governments, government-chartered agencies and departments (ex. U.S. Treasury Department), non-governmental organizations, commercial banks, investment banks, and many other organizations. The instruments can be written, with a published average credit spread number as the initial value upon which the financial instrument's terms are based. The predicted future value of said credit spread will change in response to market buy/sell demand based on investor expectations of said predicted future value of said credit spread related to one or more credit spread-linked financial instrument(s). Thus, the predicted future value of said spread will change in response to said market demand as investors offer to buy and/or sell credit spread-linked financial instruments which will be listed on securities exchanges and electronic commerce networks (ECNs) as well as over the counter (OTC) and in private transactions. Each predicted future average credit spread value will change based on said investor expectation of how strong demand will be for the underlying average credit spread involved. Thus, the present invention gives investors a means of taking or adjusting positions upon average credit spread changes in market segments defined by geography, credit history, industry type, industry size, firm size, provision of collateral, third-party guarantee, or type of debt obligation. It is important to note credit spread-linked financial instruments can be created either in standardized contract sizes that can be traded on futures, options or other securities exchanges, ECNs and/or OTC, or can be customized to meet the specifications of a transactional counterparty which wishes to speculate on movements in market segments defined by geography, credit history, industry type, industry size, firm size, provision of collateral, third-party guarantee, or type of debt obligation. Such instruments may also be created from a plurality of spreads, thus allowing an investor to package movements from several different credit spreads into a single financial instrument. Such instruments may also involve a combination of credit spread-linked financial instruments, either with each other or with other financial instruments in a combination containing at least one credit spread-linked financial instrument.