Patent ID: 8306905

Claim:
A system for exchanging OTC (Over the Counter) derivatives related data, the system comprising: a plurality of data input/output and processing stations, an optional central station and a network interconnecting all stations, wherein the data input/output and processing stations are operable by parties participating in OTC derivatives related contracts for transmitting and receiving, through the network, trade details, including designated maturity dates, mark-to-market values and risk characteristics, for existing OTC derivative transactions carried out with other parties, wherein the optional central station is for receiving the trade details over the network from the data input/output and processing stations, wherein the existing OTC derivative transactions include linked OTC derivative transactions for which the trade details are available for both of the parties to the respective existing OTC derivative transaction; wherein at least one of the data input/output and processing stations or optional central station includes a processor, wherein the processor is operable for generating, using the existing linked OTC derivative transactions, premature termination proposals consisting of packages of a plurality of linked OTC derivative transactions having designated maturity dates, wherein each of the proposals includes at least three involved parties, and wherein the proposals are for premature termination of the linked OTC derivative transactions of the packages at a date at which there is no prescribed value and no prescribed method of determining a value at which the termination of the linked OTC derivative transactions of the packages should take place, and at which there is no obligation for the involved parties to make premature terminations of the linked OTC derivative transactions of the packages, wherein there is substantially no financial loss to all of the involved parties to terminate prematurely before their respective designated maturity dates, according to parameters set by the involved parties; wherein the at least one station provides the premature termination proposal packages to the involved parties for their approval; wherein the processor is operable, for each new OTC derivative transaction that one party is about to make, to use the available OTC transaction data regarding the one party to propose a list of counterparties with which there is no substantial financial loss to execute the new OTC derivative transaction, wherein the list is determined by finding counterparties to the one party where adding the new OTC derivative transaction will lower net exposure to one or more of the risk characteristics, thereby making the sum of the OTC derivative transactions of the one party less dependent on changes in valuation parameters and allowing for a premature termination proposal, or where the new OTC derivative transaction reduces current credit exposure of the one party.