Standardization and management of over-the-counter financial instruments

Abstract

A method of managing financial products is disclosed. The method includes receiving transaction parameters associated with a financial transaction, determining a standardized financial product, wherein the standardized financial transaction reflects the transaction parameters associated with the financial position, calculating a net present value position between the financial position and the standardized financial product, and clearing the net present value position through a clearing party.

1 .- 19 . (canceled) 
     
     
         20 . A non-transitory computer readable medium, comprising instructions executable to:
 receive transaction information on a pre-defined derivative over a computer network, the transaction information including an indication of a transaction between first and second parties and a transaction cost;   communicate confirmation of the transaction between the first and second parties;   fix, at a predetermined time subsequent to the transaction, the pre-defined derivative, the fix including selecting a fixing price, the fixing price being a price at which the pre-defined derivative has a net present value of zero; and   mark trade positions of the first and second parties to the pre-defined derivative according to the fixing price, the marking including paying or receiving a difference between the transaction cost and the fixing price.   
     
     
         21 . The non-transitory computer readable medium of  claim 20 , wherein the pre-defined derivative includes an interest rate swap. 
     
     
         22 . The non-transitory computer readable medium of  claim 21 , wherein the transaction information includes an agreed upon notional amount and wherein in the transaction cost and the fixing price each are interest rates. 
     
     
         23 . The non-transitory computer readable medium of  claim 20 , wherein the transaction information includes an agreed upon notional amount and wherein in the transaction cost and the fixing price each are interest rates. 
     
     
         24 . The non-transitory computer readable medium of  claim 20 , wherein the predetermined time is included in a set of predetermined times. 
     
     
         25 . The non-transitory computer readable medium of  claim 24 , wherein the fixing reoccurs for each predetermined time in the set of predetermined times. 
     
     
         26 . The non-transitory computer readable medium of  claim 24 , wherein the marking reoccurs for each predetermined time in the set of predetermined times. 
     
     
         27 . The non-transitory computer readable medium of  claim 24 , wherein the set of predetermined times is periodic). 
     
     
         28 . The non-transitory computer readable medium of  claim 24 , wherein the net present value adjusts over time. 
     
     
         29 . The non-transitory computer readable medium of  claim 20 , wherein the net present value adjusts over time. 
     
     
         30 . A system, comprising:
 exchange communication circuitry configured to:   receive transaction information on a pre-defined interest rate swap over a computer network, the transaction information including an indication of first and second parties to the swap, agreed upon notional amount, and a first interest rate; and   communicate confirmation of execution of the swap between the first and second parties; and   exchange payment circuitry communicatively coupled to the exchange communication circuitry and configured to:   fix the swap at a predetermined time subsequent to the execution of the swap, the fix including selecting a second interest rate, the second interest rate being an interest rate at which the swap has a net present value of zero; and   mark trade positions of the first and second parties according to the fix, the marking including paying or receiving a difference between the first interest rate and the second interest rate.   
     
     
         31 . The system of  claim 30 , wherein in the first and second interest rates are different interest rates. 
     
     
         32 . The system of  claim 30 , wherein in the first and second interest rates are similar interest rates. 
     
     
         33 . The system of  claim 30 , wherein the predetermined time is included in a set of predetermined times. 
     
     
         34 . A method, comprising:
 receiving, at a transceiver of a derivatives exchange server, transaction information on a pre-defined derivative over a computer network, the transaction information including an indication of a transaction between first and second parties and a transaction cost;   communicating, by the transceiver, confirmation of the transaction between the first and second parties;   fixing the pre-defined derivative by payment circuitry of the derivatives exchange server at a predetermined time of a set of predetermined times subsequent to the transaction, the fixing including selecting a fixing price and the fixing price being a price at which the pre-defined derivative has a net present value of zero; and   marking, by the payment circuitry, trade positions of the first and second parties to the pre-defined derivative according to the fixing price, the marking including paying or receiving a difference between the transaction cost and the fixing price.   
     
     
         35 . The method of  claim 34 , wherein the fixing reoccurs for each predetermined time in the set of predetermined times. 
     
     
         36 . The method of  claim 34 , wherein the marking reoccurs for each predetermined time in the set of predetermined times. 
     
     
         37 . The method of  claim 34 , wherein the set of of predetermined times is periodic. 
     
     
         38 . The method of  claim 34 , wherein the net present value adjusts over time. 
     
     
         39 . The method of  claim 34 , wherein the pre-defined derivative includes an interest rate swap, and wherein the transaction information includes an agreed upon notional amount and wherein in the transaction cost and the fixing price each are interest rates.