Patent Document ID: 20080215480
Application ID: 12035347
Patent Flag: 0

Claim One:
1. A method for dynamically allocating control rights to offset risks and to optimize net gain or net loss associated with an inventory of at least one of assets and liabilities used to secure an extension of credit, the method comprising: providing at least one respective agreement related to the extension of credit to be executed by each of a plurality of counterparties; receiving from each of the counterparties an executed respective agreement, whereby the counterparties become contractually bound; receiving from at least some of the counterparties respective inventory for securing the extension of credit; aggregating the respective inventory into an inventory pool; charging a respective margin amount to each of the at least some of the counterparties, wherein the respective margin amount is proportional to an initial value of each the at least some counterparty's pro rata inventory contribution and a function derived from state-dependent and path-dependent dynamics governing the value of that contribution over time, and further wherein the respective margin amount is subject to change over time; securing the extension of credit with the inventory pool; and allocating the control rights to at least some of the inventory in the inventory pool in case at least one respective agreement term is not met by at least one of the counterparties.