Methods and apparatus for compound redeemable arbitrage

Abstract

Methods and apparatus for Compound Redeemable arbitrage relating to the based upon creation and redemption of Compound Redeemable Instruments. Apparatus include server executing executable software to designate specific assets for joint redemption and allocating a predetermined number of the specified assets for distribution based upon a joint redemption. Joint redemption may include redemption of two disparate classes of financial instruments.

What is claimed is: 
     
         1 . A method for Compound Redeemable Security arbitrage, the method comprising the steps of;
 receiving into a compound redemption processor a first live data feed comprising a price of an Exchangeable Asset of an Issuer of Compound Redeemable Securities:   receiving into the compound redemption processor a second live data feed comprising a price of a Compound Redeemable Security;   receiving into the compound redemption processor an Asset Unit offer comprising an amount exchangeable for the Exchangeable Asset;   receiving into the compound. redemption processor an Instrument Unit offer bid comprising an amount exchangeable for an Instrument Unit;   with the compound redemption processor to comparing the Asset Unit offer and the Instrument Unit bid;   creating a creation arbitrage comprising the Asset Unit that may be acquired to generate the Compound Redeemable Security and the Instrument Set at a profit;   referencing the Asset Unit offer and the Instrument Unit bid for a purpose of redemption arbitrage whereby the Exchangeable Assets of the Asset Unit may be sold, and the Compound Redeemable Securities and instrument Set may be acquired for a profit; and   generating a user interactive interface executing orders for creating the creation arbitrage and for creating the redemption arbitrage for a profit.   
     
     
         2 . The method of claim wherein the user interactive interface includes bids and offers for the: Exchangeable Asset, Asset Unit, Compound Redeemable Security, and Instrument. 
     
     
         3 . The method of  claim 2  wherein the Exchangeable Asset comprise one or more of:
 a currency, commodity, physical asset, or financial instrument. 
 
     
     
         4 . The method of  claim 3  wherein at least one of the Compound Redeemable Securities comprises a return based on an index. 
     
     
         5 . The method of  claim 4  wherein the index is a measure based on a life expectancy or change in the life expectancy of a pre-specified population. 
     
     
         6 . The method of  claim 4  wherein the index is a measure of a mortality rate or change in the mortality rate of a pre-specified cohort population. 
     
     
         7 . The method of  claim 2  wherein one or more Collateral Securities comprises assets which may include assets that are financial instruments, commodities, or physical assets. 
     
     
         8 . The method of  claim 7  additionally comprising the step of designating that the Exchangeable Asset comprises a stable value. 
     
     
         9 . The method of  claim 7  additionally comprising the step of designating that the Exchangeable Asset comprises an unstable value. 
     
     
         10 . The method of  claim 7  wherein the Exchangeable Asset comprises a payout at a point in time. 
     
     
         11 . The method of  claim 10  wherein the payout occurs at a same point in time as a payout of the Compound Redeemable. Security. 
     
     
         12 . The method of  claim 1  wherein the Compound Redeemable Security is listed on a public or a private exchanges. 
     
     
         13 . The method of  claim 1  wherein the Exchangeable Asset is listed on one or more public or private exchanges. 
     
     
         14 . The method of  claim 2  wherein one Compound Redeemable Security of the Instrument Unit pays a return based on dividend payments of an issuer of common shares and another Compound Redeemable Security of the Instrument Unit pays a return based on a price of the issuer. 
     
     
         15 . The method of claim i 4  wherein the Issuer comprises the issuer of the common shares. 
     
     
         16 . The method of  claim 2  wherein: one Compound Redeemable Security of the Instrument Unit pays a return based on coupon payments of an issuer of a bond and another Compound Redeemable Security of the instrument Unit pays a return based on a principal payment of the bond. 
     
     
         17 . The method of  claim 16  wherein the Issuer is the issuer of the bond. 
     
     
         18 . The method of  claim 2  one Compound Redeemable Security of the Instrument Unit pays a return based on a price level of an Issuer security up to and including a specified price and another Compound Redeemable Security of the Instrument Unit pays a return based on the price level of said issuer Security above the specified price. 
     
     
         19 . The method of  claim 18  wherein the issuer is an issuer of a bond. 
     
     
         20 . The method of  claim 1  additionally comprising the step of enabling a trader to buy and sell the Compound Redeemable Security and the Exchangeable Asset.