System and Method for Changing Order Priority Levels in an Electronic Trading Environment

Abstract

A system and method for fee-based order priority level modification in an electronic trading environment are described. When an order reaches an exchange, a priority level of the order may be changed to a higher priority level, and the priority level of the order initially at the higher priority level may be changed to a lower priority level of the received order. In one embodiment, a trader who is gaining a higher priority level will be preferably charged a fee for having his order moved to the higher priority level, and at least a portion of that fee may be paid to a trader who is giving up his high priority level.

1 . (canceled) 
     
     
         2 . An electronic exchange device for an electronic exchange, the electronic exchange device comprising:
 an electronic processor configured to generate a fee for placing at the electronic exchange a first order of a plurality of received orders for a tradeable object in an order queue for matching an order according to a match algorithm of the electronic exchange and a user-identified priority, where the first order includes an order price and the user-identified priority.   
     
     
         3 . The electronic exchange device of  claim 2  where the fee is associated with a trader for the first order. 
     
     
         4 . The electronic exchange device of  claim 2  where the first order is changed from a first priority level to a second priority level. 
     
     
         5 . The electronic exchange device of  claim 3  where positions for the first order and a second order of the plurality of received orders are swapped according to the user-identified priority for the first order and a user-identified priority for the second order. 
     
     
         6 . The electronic exchange device of  claim 5  where the trader of the first order is assessed the fee. 
     
     
         7 . The electronic exchange device of  claim 5  where the trader of the second order is credited at least a portion of the fee. 
     
     
         8 . The electronic exchange device of  claim 5  where a quantity of the second order is less than a quantity of the first order and where a portion of the first order is swapped with the second order. 
     
     
         9 . The electronic exchange device of  claim 5  where a quantity of the second order is greater than a quantity of the first order and where a portion of the second order is swapped with the first order. 
     
     
         10 . The electronic exchange device of  claim 5  where ownership of the first order and the second order is swapped. 
     
     
         11 . The electronic exchange device of  claim 2 , further comprising displaying a queue position for the plurality of received orders on a graphical user interface.