Trading Exposure Management System and Method

Abstract

Aspects of the present invention are directed to a computer-implemented trading exposure management method and system for centrally managing trading exposures within an industry. The method may include receiving a client request for additional exposure capacity above a predetermined client exposure limit with respect to a particular counterparty and selecting a third party with available exposure capacity with respect to the particular counterparty. The method may additionally include transferring at least a portion of the selected third party's available exposure capacity with respect to the particular counterparty to the client.

What is claimed is: 
     
         1 . A computer-implemented trading risk exposure management method for centrally managing trading risk exposures within an industry implementing a trading risk exposure management system including at least a processing unit and a memory, the method comprising:
 receiving, at a host server over a network, a client request for additional exposure capacity above a predetermined client risk exposure limit with respect to a particular counterparty;   accessing a client portfolio from memory and implementing the processing unit to perform steps including:
 analyzing the client portfolio; 
 comparing the client portfolio to available third party exposure capacity; 
 selecting a third party with available exposure capacity with respect to the particular counterparty; 
 transferring at least a portion of the selected third party's available exposure capacity with respect to the particular counterparty to the client; 
 determining if residual client exposure exists with respect to the predetermined counterparty; and 
 offering a hedging product to hedge the residual exposure. 
   
     
     
         2 . The method of  claim 1 , further comprising receiving a fee from the requesting client in exchange for the transfer. 
     
     
         3 . The method of  claim 1 , further comprising receiving a fee from the selected third party for performing the transfer. 
     
     
         4 . The method of  claim 1 , further comprising determining whether a client needs additional exposure capacity and providing the additional exposure capacity. 
     
     
         5 . The method of  claim 1 , wherein transferring the exposure capacity comprises one of selling, lending, and trading the exposure capacity. 
     
     
         6 . The method of  claim 1 , further comprising analyzing a portfolio of a requesting client, analyzing a third party portfolio, and a client with a third party based on the analyses. 
     
     
         7 . The method of  claim 1 , further comprising transferring excess trading exposure of the client with respect to a different counterparty to another entity requesting additional credit exposure capacity. 
     
     
         8 . A computer-implemented trading risk exposure management method for centrally managing trading risk exposures within an industry implementing a trading risk exposure management system including at least a processing unit and a memory, the method comprising:
 receiving, at a host server over a network, requests from multiple clients for additional exposure capacity above a predetermined client exposure limit with respect to multiple counterparties;   receiving, at a host server over a network, requests from multiple third parties having additional exposure capacity with respect to the multiple counterparties, the requests for transferring the additional exposure capacity selected clients;   accessing the exposure capacities from the memory and implementing the processing unit to perform steps including:
 matching the additional exposure capacities with the received requests from multiple clients; and 
 transferring exposure capacity from the requesting multiple third parties to the multiple requesting clients. 
   
     
     
         9 . The method of  claim 8 , further comprising receiving a fee from the requesting client in exchange for the transfer and receiving a fee from the selected third party for performing the transfer. 
     
     
         10 . The method of  claim 8 , further comprising determining whether a client needs additional exposure capacity and providing the additional exposure capacity. 
     
     
         11 . The method of  claim 8 , wherein transferring the exposure capacity comprises one of selling, lending, and trading the exposure capacity. 
     
     
         12 . The method of  claim 8 , further comprising analyzing a portfolio of a requesting client, analyzing a third party portfolio, and a client with a third party based on the analyses. 
     
     
         13 . The method of  claim 8 , further comprising transferring excess trading exposure of the client with respect to a different counterparty to another entity requesting additional credit exposure capacity. 
     
     
         14 . A computer-implemented trading exposure management method for centrally managing trading exposures within an industry implementing a trading risk exposure management system including at least a processing unit and a memory, the method comprising:
 receiving, at a host server over a network, requests from multiple clients for additional exposure capacity above a predetermined client exposure limit with respect to multiple counterparties;   receiving, at a host server over a network, requests from multiple third parties having additional exposure capacity with respect to the multiple counterparties, the requests for transferring the additional exposure capacity selected clients;   accessing characteristics of requesting clients, third parties, and counterparties and exposure capacities from the memory and implementing the processing unit to perform steps including:
 analyzing pertinent characteristics of requesting clients, third parties, and counterparties, the pertinent characteristics including exposure type and exposure amount; 
 matching the additional exposure capacities with the received requests from multiple clients based on the analysis; 
 transferring exposure capacity with respect to selected counterparties from the requesting multiple third parties to the multiple requesting clients, wherein transferring the exposure capacity comprises one of selling, lending and trading the exposure capacity; 
 determining if residual client exposure exists with respect to the selected counterparties; and 
 offering a hedging product to hedge the residual exposure. 
   
     
     
         15 . A computer-implemented trading risk exposure management system for centrally managing trading risk exposures within an industry including at least a processing unit and a memory, the system comprising:
 client communication components for receiving at a host server over a network, a client request for additional exposure capacity above a predetermined client risk exposure limit with respect to a particular counterparty;   a computer memory storing client portfolio, the client portfolios being accessible to the trading risk exposure management system an exposure processing engine implemented by the processing unit for analyzing the client portfolio, including comparing the client portfolio to available third party exposure capacity and selecting a third party with available exposure capacity with respect to the particular counterparty;   an exposure transfer engine for transferring at least a portion of the selected third party's available exposure capacity with respect to the particular counterparty to the client;   an exposure calculation engine for determining if residual client exposure exists with respect to the predetermined counterparty; and   an exposure output engine for offering a hedging product to hedge the residual exposure.   
     
     
         16 . The system of  claim 15 , further comprising communications components for receiving a fee from the requesting client in exchange for the transfer. 
     
     
         17 . The system of  claim 15 , further comprising communications components for receiving a fee from the selected third party for performing the transfer. 
     
     
         18 . The system of  claim 15 , wherein the exposure processing engine further comprises determining whether a client needs additional exposure capacity and providing the additional exposure capacity. 
     
     
         19 . The system of  claim 15 , wherein the exposure transfer engine further comprises one of selling, lending, and trading the exposure capacity. 
     
     
         20 . The system of  claim 15 , wherein the exposure transfer engine further comprises transferring excess trading exposure of the client with respect to a different counterparty to another entity requesting additional credit exposure capacity.