Patent EA-001644-B1 (EA)
Title: Method and apparatus for automating negotiations between parties
Inventor: RICKARD JOHN T
IPC: G06Q40/06
Filed: 1998-02-23
Abstract: 1. A method for automating negotiations for simultaneous trading of a plurality of different securities, comprising the steps of: a) mapping data from a first party regarding a simultaneous trade of a plurality of different securities as a group into a first function expressing degrees of satisfaction of the first party to trade the plurality of different securities simultaneously as a group over a desired range of costs; b) collecting in a central database input from a plurality of traders regarding a degree of satisfaction of each of the plurality of traders to take a position opposite to the first party in at least one of the plurality of different securities as a function of price; c) determining from the input of the plurality of traders a joint function expressing a joint degree of satisfaction by one or more second parties among the plurality of traders to take an opposite position in all of the plurality of different securities as a function of price in each of the plurality of different securities; d) determining a composite function of the first function and the joint function, wherein the composite function represents a mutual degree of satisfaction to execute a trade in all of the plurality of different securities between the first party and the one or more second parties; and e) identifying for each of the plurality of different securities a trading price, a trading volume and a trading party among the one or more second parties that maximizes the composite function. 2. The method according to claim 1, further comprising the step of: f) executing simultaneously with the first party and the trading parties a trade in the plurality of different securities at the trading prices and the trading volumes identified in step e). 3. The method according to claim 1, wherein the step b) of collecting further comprises the steps of: (i) collecting information from the plurality of traders regarding the degrees of satisfaction of the each of the plurality of traders to take either position in the plurality of different securities; and  ii) selecting from the information collected in step b)(i) the input regarding the degrees of satisfaction of the plurality of traders to take a position opposite to the first party in each of the plurality of different securities. 4. The method according to claim 10, wherein the step b) of collecting further comprises the steps of: (i) collecting information from the plurality of traders regarding the degrees of satisfaction of the plurality of traders to take either position in the plurality of different securities; and  (ii) selecting from the information collected in step b)(i) the input regarding the degrees of satisfaction of the plurality of traders to take a position opposite to the first party in each of the plurality of different securities. 5. The method according to claim 1, wherein the step e) of identifying further comprises the steps of: (i) determining an absolute maximum value of the composite function; (ii) defining a region about the absolute maximum value of the composite function; and (iii) determining a trading price, a trading volume and a trading party for each security of the plurality of different securities so that a resulting value of the composite function lies within the region defined in step e)(ii). 6. The method according to claim 5, wherein the predetermined criteria includes a nearest practical decision variable. 7. The method according to claim 5, wherein the predetermined criteria includes a nearest practical decision of the trading volume. 8. The method according to claim 5, wherein the predetermined criteria includes a nearest practical decision of the trading price. 9. The method according to claim 5, wherein the predetermined criteria includes within said region maximizing the decision variable in favor of the at least one other party. 10. A method for automatically determining a set of terms of an agreement between a first party and at least one other party, wherein the agreement includes a plurality of terms, comprising the steps of:  a) mapping input from the first party regarding the plurality of terms in the agreement into a first function expressing a degree of satisfaction of the first party to agree to the plurality of terms over a range of values of a decision variable b) collecting input in a central database from at least one other party regarding the degree of satisfaction of the at least one other party to enter into the agreement with the first party on individual ones of the plurality of terms; c) mapping the input into a second function expressing the degree of satisfaction of the at least one other party to agree to the plurality of terms as a function of the decision variable in each of the plurality of terms; d) determining a composite function of the first function and the second function, wherein the composite function represents a mutual degree of satisfaction between the first party and the at least one other party to agree to the plurality of terms; and  e) determining a set of terms and a value for each of the decision variables for the agreement from a maximum of the composite function. 11. The method according to claim 21, further comprising the step of: f) executing automatically an agreement according to the set of terms and decision variables determined in step e). 12. The method according to claim 10, wherein the step b) of collecting further comprises: (i) collecting information from a plurality of other parties regarding the degrees of satisfaction of the plurality of other parties to enter into an agreement on individual ones of the plurality of terms; and (ii) selecting from the information collected in step b)(i) the input regarding the degrees of satisfaction of the at least one other party to enter into the agreement with the first party on the individual ones of each of the plurality of terms in the agreement. 13. The method according to claim 11, wherein the step b) of collecting further comprises: (i) collecting information from a plurality of other parties regarding the degrees of satisfaction of the plurality of other parties to enter into an agreement on individual ones of the plurality of terms; and (ii) selecting from the information collected in step b)(i) the input regarding the degrees of satisfaction of the at least one other party to enter into the agreement with the first party on the individual ones of each of the plurality of terms in the agreement. 14. The method according to claim 10, wherein the step e) of determining further comprises the steps of: (i) determining an absolute maximum value of the composite function; (ii) defining a region about the absolute maximum value of the composite function; and (iii) determining a set of values for each of the decision variables yielding a value of the composite function that lies within the region defined in step e)(ii). 15. The method according to claim 14, wherein the step e)(iii) of determining further comprises the step of selecting the set of values for each of the decision variables using predetermined criteria. 16. The method according to claim 14, wherein the predetermined criteria includes a nearest practical decision variable. 17. The method according to claim 14, wherein the predetermined criteria includes within said region maximizing the decision variable in favor of the at least one other party 1. A method for performing simultaneous trading of a plurality of securities, comprising the steps of: a) mapping data from a first party regarding a simultaneous trade of a plurality of securities as a group into a first function expressing degrees of satisfaction of the first party to trade the plurality of securities simultaneously as a group over a desired range of costs; b) collecting in a central database input from a plurality of traders regarding a degree of satisfaction of each of the plurality of traders to take a position opposite to the first party in at least one of the plurality of securities as a function of price; c) determining from the input of the plurality of traders a joint function expressing a joint degree of satisfaction by one or more second parties among the plurality of traders to take an opposite position in all of the plurality of securities as a function of price in each of the plurality of securities; d) determining a composite function of the first function and the joint function, wherein the composite function represents a mutual degree of satisfaction to execute a trade of the plurality of securities between the first party and the one or more of other parties; and  e) identifying for each of the plurality of securities a trading price, a trading volume and a trading party among the one or more other parties that maximizes the composite function. 2. The method according to claim 1, further comprising the step of: f) executing simultaneously with the first party and the trading parties a trade in the plurality of securities at the trading prices and the trading volumes identified in step e). 3. The method according to claim 1, wherein the step b) of collecting further comprises: (i) collecting information from the plurality of traders regarding the degrees of satisfaction of the plurality of traders to take either position in the plurality of securities; and  (ii) selecting from the information collected in step b)(i) the input regarding the degrees of satisfaction of the plurality of traders to take a position opposite to the first party in each of the securities. 4. The method according to claim 2, wherein the step b) of collecting further comprises: (i) collecting information from the plurality of traders regarding the degrees of satisfaction of the plurality of traders to take either position in the plurality of securities; and (ii) selecting from the information collected in step b)(i) the input regarding the degrees of satisfaction of the plurality of traders to take a position opposite to the fir