Patent ID: 8065217

Claim:
A computer-implemented method for real-time portfolio balancing and/or optimization of at least one current security of an existing portfolio of securities to a new security, comprising the steps of: (a) determining at a securities trader location a portfolio balancing event time; (b) determining in an existing portfolio of securities stored at the securities trader location at least one current security that is to be replaced with a new security; (c) determining at the securities trader location a new security that is to replace the current security in the existing portfolio of securities; (d) determining at the securities trader location a net long and short cash constraint for portfolio balancing transactions; (e) communicating from the securities trader location to a securities trading system at least trading information for trading up to a preferred number of shares of the current security, trading information for trading up to a preferred number of shares of the new security, and the cash constraint; (f) the securities trading system identifying a trade to at least in part replace the current security with the new security; (g) the securities trading system determining for a number of shares of the current security available for trading on the securities trading system up to the predetermined number of shares of the current security communicated at step (e) a sale value according to the number of shares of the current security available for trading on the securities trading system multiplied times a current bid price for the current security posted on the securities trading system from the securities trader location; (h) the securities trading system determining for a number of shares of the new security available for trading on the securities trading system up to the predetermined number of shares of the new security communicated at step (e) a number of shares of the new security that can be purchased according to the sale value determined at step (g) divided by an offer price for the new security posted on the securities trading system; (i) the securities trading system determining if a net value of the sale value determined at step (g) and the number of shares of the new security to be purchased according to step (h) multiplied times the offer price for the new security posted on the securities trading system is equal to or less than the cash constraint determined at step (d), and if the net value is equal to or less than the cash constraint proceeding to step (j) and if the net value is greater than the cash constraint proceeding to step (g); (j) the securities trading system simultaneously trading the number of shares of the current security determined at step (g) and the number of shares of the new security determined that step (h) to replace at least in part the current security with the new security in the existing portfolio of securities; and (k) storing at the securities trader location the existing portfolio of securities that includes at least the new security that replaced the current security.