Patent ID: 7685054

Claim:
A method for electronically trading options contracts and underlying contracts, wherein trading orders for trading the options contracts and underlying contracts are placed on a market server by a plurality of trader clients, the plurality of trader clients communicating with the market server over a computer network, the method comprising the steps of: receiving, at the market server, a first order transmitted from a first one of the plurality of trader clients by a first trader, the first order specifying a bid to buy a first number of the options contracts and specifying a first hedge delta, the first hedge delta specifying a bid to buy or sell a first number of the underlying contracts; receiving, at the market server, a second order transmitted from a second one of the plurality of trader clients by a second trader, the second order specifying a bid to sell a second number of the options contracts and specifying a second hedge delta, the second hedge delta specifying a bid to sell or buy a second number of underlying contracts; determining by the market server whether the first order and the second order are matched according to one or more predetermined conditions; and executing a the trade of options contracts and underlying contracts among the first and second traders by the market server when the first order and the second order are matched; wherein one of the predetermined conditions requires that the first hedge delta is equal to the second hedge delta.