Methods and Apparatus to Internalize Trade Orders

Abstract

Methods and apparatus to internalize trade orders are described herein. An example method includes obtaining, via an internalization manager, a trade order communicated to an exchange. The trade order corresponds to a tradeable object offered at the exchange. The example method includes comparing, via the internalization manager, the trade order to one or more trade orders in an internalization order record to determine whether a matching contra-side trade order is included in the one or more trade orders in the internalization order record. The example method includes communicating, via the internalization manager, an order modification to the exchange if a matching contra-side trade order is included in the one or more trade orders in the internalization order record, and matching, via the internalization manager, if a matching contra-side trade order is included in the one or more trade orders in the internalization order record, the trade order to the matching contra-side trade order in the internalization order record.

1 . (canceled) 
     
     
         2 . A method including:
 establishing an internalization book at a trade internalization manager in communication with an electronic exchange;   receiving, at the trade internalization manager, a first message for a trade order via a multicast communication, wherein the multicast communication further provides the first message to the electronic exchange at substantially the same time as the gateway;   identifying, based on the internalization book, a contra-side trade order based on the first message, wherein the contra-side trade order is for an opposite side from the first message for the trade order;   communicating a quantity adjustment for the trade order to the electronic exchange based on a quantity of the contra-side trade order; and   executing an internal trade of the trade order based on the contra-side trade order, wherein the internalization book updates to reflect the internal trade.   
     
     
         3 . The method of  claim 2 , wherein the first message is sent by a trading device of a plurality of trading devices in communication with the trade internalization manager. 
     
     
         4 . The method of  claim 2 , wherein the first message for the trade order is received by a gateway implementing the trade internalization manager. 
     
     
         5 . The method of  claim 2 , wherein the contra-side trade order is identified based on a price of the trade order. 
     
     
         6 . The method of  claim 2 , wherein the contra-side trade order is identified based on a quantity of the trade order. 
     
     
         7 . The method of  claim 2 , wherein the contra-side trade order is for a same trader as the trade order. 
     
     
         8 . The method of  claim 2 , wherein the contra-side trade order is for a same trading group as the trade order. 
     
     
         9 . The method of  claim 2 , wherein the contra-side trade order is for a same institution as the trade order. 
     
     
         10 . The method of  claim 2 , wherein the quantity adjustment is a command to cancel the trade order. 
     
     
         11 . The method of  claim 2 , wherein the quantity adjustment is a command to modify the trade order. 
     
     
         12 . The method of  claim 2 , further including:
 receiving a confirmation of the quantity adjustment from the electronic exchange, wherein executing the internal trade is further based on the confirmation from the electronic exchange.   
     
     
         13 . The method of  claim 2 , further including:
 requesting approval to execute the internal trade.   
     
     
         14 . The method of  claim 2 , wherein the first message is received via a first communication path and provided to the electronic exchange via a second communication path. 
     
     
         15 . The method of  claim 2  further comprising:
 updating the internalization book to reflect the first message.