Open End Mutual Fund Securitization Process

Abstract

A computer implemented system is provided for administering and exchanging shares in an exchange traded product.

1 . (canceled) 
     
     
         2 . A computer-implemented apparatus for administering a managed exchange traded product that invests assets in income generating securities, the apparatus comprising:
 a. an exchange traded product processor that issues one or more classes of shares listed for trading on a securities exchange and are bought and sold on the exchange at negotiated market prices;   b. an exchange traded product portfolio trading and managing computer that receives instructions to:
 i. select and hold a portfolio of the income generating securities related to a benchmark and 
 ii. applies leverage to the portfolio through shorting. 
   
     
     
         3 . The computer-implemented apparatus of  claim 2  wherein the instructions for the application of the leverage are received, at least in part, from a portfolio manager that is also an investor. 
     
     
         4 . The computer-implemented apparatus of  claim 2  wherein at least one of the securities is a derivative selected from a group comprising one or more puts and calls, futures, caps and floors, total return swaps, hybrids, collars, warrants, equity swaps, options and knock-out options. 
     
     
         5 . The computer-implemented apparatus of  claim 2  wherein a composition of the portfolio of securities is displayed on a daily basis. 
     
     
         6 . The computer-implemented apparatus of  claim 2  wherein the benchmark comprises only one security. 
     
     
         7 . The computer-implemented apparatus of  claim 2  wherein the portfolio of securities does not include funds. 
     
     
         8 . The computer-implemented apparatus of  claim 2  wherein the exchange traded product is not a closed end fund. 
     
     
         9 . A computer-implemented method of purchasing or selling exchange-traded shares comprising:
 a. receiving into a computer an order to purchase or sell exchange-traded shares associated with an exchange traded product whose assets include leveraged investments comprising at least one from a group comprising derivatives and short sales, the product having issued:
 i. one or more classes of shares listed for trading on a securities exchange that are bought and sold at negotiated market prices, and 
 ii. a number of the shares outstanding capable of fluctuating daily; and 
   b. executing the order on the exchange via one or more computers.   
     
     
         10 . The method of  claim 9  wherein the order is received from a broker. 
     
     
         11 . The method of  claim 9  wherein the order is executed by a market maker. 
     
     
         12 . The method of  claim 9  wherein the short sales are sold by a portfolio manager who is also an investor. 
     
     
         13 . The method of  claim 12  wherein the short sales comprise shares sold short. 
     
     
         14 . The method of  claim 9  wherein the assets further comprise at least one of cash, equities, dividends, debt, bonds, money market instruments, hybrids, swaps, options, and futures. 
     
     
         15 . The method of  claim 9  wherein the assets do not include funds. 
     
     
         16 . The method of  claim 9  wherein the product is a trust. 
     
     
         17 . The method of  claim 9  wherein the product is a fund. 
     
     
         18 . The method of  claim 9  wherein the product is not a closed end fund. 
     
     
         19 . The method of  claim 9  wherein an exchange traded option is listed on the product. 
     
     
         20 . The method of  claim 19  wherein the exchange traded option is bought and sold by market participants comprising at least one of market makers, brokers and investors on or off the floor of an exchange. 
     
     
         21 . The method of  claim 9  wherein the exchange traded shares are electronically traded on or off a floor of an exchange. 
     
     
         22 . The method of  claim 9  wherein the number of shares outstanding fluctuates daily. 
     
     
         23 . The method of  claim 22  wherein the exchanged traded shares are bought and sold during the day through an order comprising at least one of GTC, open, stop loss, market and limit. 
     
     
         24 . The method of  claim 9  wherein the product is cleared through a clearing corporation. 
     
     
         25 . The method of  claim 9 , the product comprising a net asset value calculated by a computer processor on a daily basis. 
     
     
         26 . The method of  claim 25 , the net asset value of the product comprising gains based at least in part on short sales. 
     
     
         27 . The method of  claim 25 , the net asset value of the product comprising gains based at least in part on the trading of derivatives. 
     
     
         28 . The method of  claim 25  wherein the shares are traded during the day at any price regardless of the net asset value when buyers and sellers agree on a price. 
     
     
         29 . The method of  claim 21  wherein the shares are traded at mutually agreed upon prices during the day. 
     
     
         30 . The method of  claim 18  wherein the product is a fund of funds. 
     
     
         31 . The method of  claim 22  wherein the shares are traded during the day at the net asset value. 
     
     
         32 . The method of  claim 22  wherein the shares are traded at the end of the day at the net asset value. 
     
     
         33 . A computer-implemented apparatus for administering a managed exchange traded fund of funds product, the apparatus comprising:
 a. an exchange traded product processor that issues one or more classes of shares listed for trading on a securities exchange and are bought and sold on the exchange at mutually agreed upon prices;   b. an exchange traded product trading and managing computer that receives instructions to:
 i. select and hold investments, the investments comprising at least one of a group comprising derivatives and short sales. 
   
     
     
         34 . The computer-implemented apparatus of  claim 33 , wherein the short sales comprise at least shares of funds sold short. 
     
     
         35 . A computer-implemented method of purchasing or selling exchange-traded shares comprising:
 a. receiving into a computer an order to purchase or sell exchange-traded shares associated with an exchange traded product comprising at least one from a group comprising derivatives and shorting investments, the product having issued:
 i. one or more classes of shares listed for trading on a securities exchange that are bought and sold at mutually agreed upon prices during the day at prices that, during at least one point in time, differ from a closing net asset value, and 
 ii. a number of the shares outstanding capable of fluctuating daily; and 
   b. executing the order on the exchange via one or more computers.   
     
     
         36 . The method of  claim 35  wherein the investments comprise at least one of futures, options, and swaps. 
     
     
         37 . The method of  claim 35  wherein the product is not a closed end fund. 
     
     
         38 . A computer-implemented method of purchasing or selling exchange-traded options comprising:
 a. receiving into a computer an order to purchase or sell exchange-traded options associated with a specific exchange traded product whose assets comprise at least one from a group comprising derivatives and shorting investments, the product having issued:
 i. one or more classes of shares listed for trading on a securities exchange that are bought and sold at negotiated market prices, and 
 ii. a number of the shares outstanding capable of fluctuating daily; and 
   b. executing the order on the exchange via one or more computers.   
     
     
         39 . The method of  claim 38  wherein the product is at least one from a group comprising a fund, a fund of funds, a trust, not a closed end. 
     
     
         40 . The method of  claim 38  further comprising the purchase or sale of a hedge that is bought or sold for a price related to the price of the option. 
     
     
         41 . The method of  claim 38  wherein the exchange traded option is bought and sold during the day by market participants comprising at least one of market makers, brokers and investors, on or off the floor of an exchange. 
     
     
         42 . The method of  claim 38  wherein the options are listed on an exchange. 
     
     
         43 . The method of  claim 42  wherein orders to buy and sell the options are electronically disseminated to market participants in humanly readable form. 
     
     
         44 . The method of  claim 38  wherein the order is electronically cleared through a clearing corporation. 
     
     
         45 . The method of  claim 38  wherein the exchange traded product can be bought and sold by investors at a price other than net asset value during the day when a buyer and seller agree on a price that is not the net asset value. 
     
     
         46 . The method of  claim 39  wherein the fund is configured to sell or buy back shares at the net asset value at the end of each day. 
     
     
         47 . The method of  claim 39  wherein the trust comprises leveraged investments. 
     
     
         48 . The method of clam  40  wherein the fund comprises leveraged investments. 
     
     
         49 . A computer-implemented method of clearing purchased or sold exchange- traded options comprising:
 a. receiving into a computer an executed order representing a purchased or sold exchange-traded option associated with an exchange traded product whose assets comprise at least one of a from a group comprising derivatives and shorting investments, the product having issued:
 i. one or more classes of shares listed for trading on a securities exchange that are bought and sold at negotiated market prices, and 
 ii. a number of the shares outstanding capable of fluctuating daily; and 
   b. clearing the executed order via one or more computers.   
     
     
         50 . The method of  claim 49  wherein the computer is configured to compute and transmit data resulting from cleared trades to third party accounting systems. 
     
     
         51 . The method of  claim 49  wherein the product is a fund. 
     
     
         52 . The method of  claim 49  wherein the product is a trust. 
     
     
         53 . The method of  claim 51  wherein the product is not a closed end fund. 
     
     
         54 . The method of  claim 49  wherein the product is either an equity security or not an non-equity security. 
     
     
         55 . The method of  claim 49  wherein a composition of the assets of the exchange traded product is displayed on a daily basis. 
     
     
         56 . The method of  claim 49  wherein the exchange traded product bought and sold by investors at a price other than net asset value during the day when a buyer and seller agree on a price that is not the net asset value. 
     
     
         57 . The method of  claim 51  wherein the fund is configured to sell or buy back shares at the net asset value at the end of each day. 
     
     
         58 . A computer-implemented apparatus for administering a managed exchange traded fund, the apparatus comprising:
 a. an exchange traded product processor that issues one or more classes of shares listed for trading on a securities exchange and are bought and sold on the exchange at prices other than net asset value during the day when a buyer and seller agree on a price that is not the net asset value, and   b. an exchange traded product trading and managing computer that receives instructions to:
 i. select and hold investments, the investments comprising at least one of a group comprising derivatives and short positions; and, 
 ii. electronically disseminate to the public a composition of the investments on a daily basis; and, 
 iii. compute and electronically disseminate a net asset value of the fund at least daily. 
   
     
     
         59 . The computer-implemented apparatus of  claim 58  wherein the fund is configured to sell and buy back shares from its shareholders at a net asset value at the end of each day. 
     
     
         60 . The computer-implemented apparatus of  claim 58  wherein one or more investments satisfy a risk criteria, including at least beta. 
     
     
         61 . The computer-implemented apparatus of  claim 60  wherein the risk of one or more of the investments is at least  50 % greater than a benchmark on at least a daily basis. 
     
     
         62 . The computer-implemented apparatus of  claim 58  wherein the fund is not a trust. 
     
     
         63 . The computer-implemented apparatus of  claim 58  wherein the fund is not a closed end fund. 
     
     
         64 . The computer-implemented apparatus of  claim 58  wherein the fund further comprises at least one product selected from a group consisting of puts and calls, futures, caps and floors, total return swaps, hybrids, collars, warrants, equity swaps, options and knock-out options. 
     
     
         65 . The computer apparatus of  claim 58  wherein the product is configured to receive instructions to alter the composition of investments on a daily basis. 
     
     
         66 . A computer-implemented apparatus for administering a managed exchange traded trust, the apparatus comprising:
 a. an exchange traded product processor that issues one or more classes of shares listed for trading on a securities exchange and are bought and sold on the exchange at prices other than net asset value during the day when a buyer and seller agree on a price that is not the net asset value, and   b. an exchange traded product trading and managing computer that receives instructions to:
 i. select and hold specific investments, the investments comprising at least one of a group, the group comprising derivatives and short positions; and, 
 ii. disseminate to the public a composition of the specific investments held by the trust on a daily basis; and, 
 iii electronically calculate and disseminate an asset value of the trust at least daily. 
   
     
     
         67 . The computer-implemented apparatus of  claim 66  wherein the trust is configured to sell and buy back shares from its shareholders at the end of each day. 
     
     
         68 . The computer-implemented apparatus of  claim 66  wherein the one or more investments satisfy a risk criteria selected from a group comprising at least beta and volatility. 
     
     
         69 . The computer-implemented apparatus of  claim 68  wherein the beta risk of one or more of the investments owned by the trust is at least 50% greater than a benchmark on at least a daily basis. 
     
     
         70 . The computer-implemented apparatus of  claim 68  wherein the volatility risk of one or more of the investments owned by the trust is at least 50% greater than a benchmark on at least a daily basis. 
     
     
         71 . The computer implemented apparatus of  claim 66  further comprising a processor for correlating the price of the shares to the prices of the investments. 
     
     
         72 . The computer-implemented apparatus of  claim 60  wherein the trust further comprises at least one product selected from a group consisting of puts and calls, futures, caps and floors, total return swaps, collars, warrants, hybrids, equity swaps, options and knock-out options. 
     
     
         73 . The computer apparatus of  claim 60  wherein the trust has one or more classes of shares. 
     
     
         74 . The computer-implemented apparatus of  claim 66  wherein the trust is configured to receive instructions to alter the composition of investments on a daily basis. 
     
     
         75 . A computer implemented system for exchanging shares in an exchange traded product, the system comprising:
 A display for displaying data representing shares of an exchange traded product, comprising a portfolio of at least one of a group, the group comprising derivatives and shorting investments, wherein the exchange traded product is configured for trading shares of the exchange traded product during the day at any mutually agreed upon price; and   an exchange computer for processing an exchange of the shares that occurs during the day, wherein the exchange computer is configured to transmit data indicative of trades which occur intra-day over a communications network to a clearing corporation.   
     
     
         76 . The computer implemented system of  claim 75  wherein the exchange computer is configured to facilitate electronic trading of the shares of the exchange traded product. 
     
     
         77 . The computer implemented system of  claim 75  wherein the portfolio satisfies a risk criteria. 
     
     
         78 . The computer implemented system of  claim 77  wherein the risk criteria is a risk percentage that is greater than a benchmark. 
     
     
         79 . The computer implemented system of  claim 78  wherein the percentage is at least 50%. 
     
     
         80 . The computer implemented system of  claim 77  wherein the risk criteria is beta. 
     
     
         81 . The computer implemented system of  claim 77  wherein the risk criteria is volatility. 
     
     
         82 . The computer implemented system of  claim 80  wherein the beta of the portfolio is at least 50% greater than the beta of a benchmark on at least a daily basis. 
     
     
         83 . The computer implemented system of  claim 81  wherein the volatility of the leveraged portfolio is at least 50% greater than the volatility of a benchmark on at least a daily basis. 
     
     
         84 . The computer implemented system of  claim 77  wherein the portfolio is configured to change on a daily basis to satisfy a risk criteria. 
     
     
         85 . The computer implemented system of  claim 75  wherein the derivatives comprise at least one product selected from a group consisting of puts and calls, futures, caps and floors, total return swaps, hybrids, collars, warrants, equity swaps, options and knock-out options, 
     
     
         86 . The computer implemented system of  claim 75  wherein the product is one of a group, the comprising a trust, a fund. 
     
     
         87 . The computer implemented system of  claim 86  wherein the product is a not a closed end fund. 
     
     
         88 . The computer implemented system of  claim 75  wherein the exchange traded product is bought and sold by investors at a price other than net asset value during the day when a buyer and seller agree on a price that is not the net asset value. 
     
     
         89 . The computer implemented system of  claim 75  wherein the portfolio of investments does not comprise funds. 
     
     
         90 . The computer implemented system of  claim 75  wherein the product is configured to sell or buy back shares at the net asset value at the end of each day. 
     
     
         91 . A computer-implemented method for exchanging shares in an exchange traded product, comprising:
 a. receiving into a computer an order to purchase or sell exchange-traded shares associated with an exchange traded product satisfying a volatility risk criteria, the product comprising a portfolio of least one of derivatives and short positions, the product having issued:
 i. one or more classes of shares listed for trading on a securities exchange that are bought and sold at mutually agreed upon prices during the day at prices that differ from a closing asset value, and 
 ii. a number of the shares outstanding capable of fluctuating daily; and 
   b. executing the order on the exchange via one or more computers.   
     
     
         92 . The computer-implemented method of  claim 91  wherein the product is more volatile than a benchmark on a daily basis. 
     
     
         93 . The computer-implemented method of  claim 91  wherein the one or more derivatives comprise at least one from a group consisting of puts and calls, futures, caps and floors, total return swaps, collars, hybrids, warrants, equity swaps, options and knock-out options. 
     
     
         94 . The computer-implemented method of  claim 91  wherein the product is one of a group comprising a trust, a fund. 
     
     
         95 . The computer-implemented method of  claim 91  further comprising the purchasing or selling of a hedge product is bought or sold for a price related to the price of the shares of the exchange traded product. 
     
     
         96 . The computer-implemented method of  claim 95  wherein the product is not a closed end fund. 
     
     
         97 . The computer-implemented method of  claim 94  wherein the product is configured to sell or buy back shares at the net asset value at the end of each day. 
     
     
         98 . The computer-implemented method of  claim 91  wherein the portfolio does not comprise funds. 
     
     
         99 . A computer implemented apparatus for exchanging shares in an exchange traded product, the apparatus comprising:
 A display for displaying data representing shares of an exchange traded product, whose assets include investments comprising at least one from a group comprising at least derivatives and short investments, the product having issued one or more classes of shares outstanding, and wherein the exchange traded product is configured for trading shares at any mutually agreed upon price during day; and   An exchange computer for processing the exchange of the shares that occur during the day, wherein the exchange computer is configured to transmit data indicative of trades which occur intra-day over a communications network to a clearing corporation.   
     
     
         100 . The computer implemented apparatus of  claim 99  wherein the exchange computer is configured to facilitate electronic trading of the shares of the exchange traded product. 
     
     
         101 . The computer implemented apparatus of  claim 99  wherein the investments satisfy a risk criteria. 
     
     
         102 . The computer implemented apparatus of  claim 101  wherein the risk criteria is a risk percentage that is greater than a benchmark. 
     
     
         103 . The computer implemented apparatus of  claim 102  wherein the percentage is at least 50%. 
     
     
         104 . The computer implemented apparatus of  claim 101  wherein the risk criteria is beta. 
     
     
         105 . The computer implemented apparatus of  claim 101  wherein the risk criteria is volatility. 
     
     
         106 . The computer implemented apparatus of  claim 104  wherein the beta of the one or more investments is at least 50% greater than the beta of a benchmark on at least a daily basis. 
     
     
         107 . The computer implemented apparatus of  claim 105  wherein the volatility of the one or more investments is at least 50% greater than the volatility of a benchmark on at least a daily basis. 
     
     
         108 . The computer implemented apparatus of  claim 99  wherein the investments do not include funds. 
     
     
         109 . The computer implemented apparatus of  claim 99  wherein the derivatives comprise at least one product selected from a group consisting of puts and calls, futures, caps and floors, total return swaps, collars, warrants, equity swaps, hybrids, options and knock-out options. 
     
     
         110 . The computer implemented apparatus of  claim 99  wherein the product is a trust. 
     
     
         111 . The computer implemented apparatus of  claim 99  wherein the product is a fund. 
     
     
         112 . The computer implemented apparatus of  claim 99  wherein the product is not a closed end fund. 
     
     
         113 . The computer implemented apparatus of  claim 99  further comprising the purchase or sale of a hedge product is bought or sold for a price related to the price of the shares of the exchange traded product. 
     
     
         114 . The computer implemented apparatus of  claim 99  wherein the product is configured to accept orders to sell or buy back shares at a net asset value at the end of each day. 
     
     
         115 . The computer implemented apparatus of  claim 99  wherein an exchange traded option is listed on the product. 
     
     
         116 . The computer implemented apparatus of  claim 99  wherein the exchange traded option is bought and sold by market participants comprising at least one of market makers, brokers and investors on or off the floor of an exchange. 
     
     
         117 . The computer implemented apparatus of  claim 99  wherein the exchange traded shares are electronically traded on or off a floor of an exchange. 
     
     
         118 . The method of  claim 99  wherein the exchange traded product is bought and sold by investors at a price other than net asset value during the day when a buyer and seller agree on a price that is not the net asset value. 
     
     
         119 . The method of  claim 99  wherein the exchange traded product is bought and sold by investors at a net asset value during the day. 
     
     
         120 . The method of  claim 103  wherein the exchange traded product provides an investor with an investment risk that is greater than a benchmark on a daily basis.