Patent ID: 8103569

Claim:
A computer-implemented method for adjusting the value and terms of equity derivatives to account for time value of money due to an occurrence of a corporate event that affects the value of said equity derivatives, comprising the steps of: receiving, via a computer, financial information regarding said equity derivatives comprising at least a termination claim of the equity derivative and the length of the equity derivative contract, wherein each equity derivative representing one of three economic components of an underlying security, a DIVS component, a RISKS component, and an OWLS component, wherein the DIVS component represents a stream of dividends distributed to holders of the underlying security, the RISKS component represents a speculation on future gains of the underlying security, and the OWLS component represents the remaining value of the underlying security absent the DIVS and RISKS components, wherein the termination claim determines the payout between the OWLS and DIVS components at the end of the equity derivative contract; receiving, via the computer, information identifying a corporate event that affects the value of said equity derivatives; adjusting, via the computer, the termination claim of the equity derivatives to its present value based at least on the length of time remaining on the equity derivative contract to account for the time value of money; determining, via the computer, any needed formulas, from a plurality of predefined formulas, for determining the effect of the corporate event on the DIVS component, RISKS component, and OWLS component, wherein said determined formulas account for the time value of money; adjusting, via the computer, the value and the terms of the DIVS component, the RISKS component, and the OWLS component based on the determined formulas and the adjusted termination claim; notifying holders of said equity derivatives, via the computer, the adjusted values and terms of said DIVS component, RISKS component, and OWLS component; and storing the adjusted termination claim, the adjusted DIVS component, the adjusted RISKS component, and the adjusted OWLS component in a computer storage disk.