Patent ID: 7676421

Claim:
A method of providing an automated auction for internalization for the purchase or sale of securities or derivatives in an exchange configured for trading securities or derivatives, the method comprising: receiving an order marked for processing in an internalization auction at an electronic trade engine; the electronic trade engine disseminating a request for price message from the electronic trade engine to at least one user in response to receiving the order; receiving a one-sided response message representative of a participant-type at the electronic trade engine in response to the request for price message from the at least one user, wherein the electronic trade engine prevents dissemination of the one-sided response message to an external reporting entity and an order routing system for the exchange; the electronic trade engine selecting an allocation algorithm from a plurality of allocation algorithms, each allocation algorithm representative of an auction-type and having at least one starting price associated therewith; the electronic trade engine initiating the selected allocation algorithm, wherein the auction occurs for a predetermined period of time; and the electronic trade engine allocating the order according to the participant-type upon termination of the selected auction.