HK1116566A - Financial activity based on natural events - Google Patents

Description

Financial activity based on natural events

Cross reference to related applications

This application claims the benefit of U.S. provisional patent application No.60/637784, filed on 21/12/2004, which is incorporated herein by reference in its entirety.

Technical Field

The present invention relates to financial activities and, in particular, to such activities that may redeem financial revenue based on participants predicting weather or other naturally occurring events, particularly such events monitored and recorded by an independent external information source.

Background

The large amount of energy contained by natural events often results in property damage, creating a potentially enormous financial burden. The nature of such catastrophic events is that they cannot be predicted with complete certainty, even the severity or number of occurrences of the event or the exact time and/or duration of the event within the season of the event. These types of natural events include, for example, earthquakes, tornadoes, and tropical weather events such as cyclones (a term that denotes all circulating weather systems for tropical waters, and of particular interest herein are the atlantic sea area and the east pacific). Tropical cyclones include tropical weather events known as "hurricanes" when they are strong enough. Tropical cyclones, which increase in strength to become hurricanes, originate at sea and may land and move along some land portion before dissipating or returning to sea. Home owners and commercial insurance policies typically contain deductible regulations, ranging from 2% to 15% of the home or work site value.

Furthermore, these same policies do not provide any insurance for areas outside of the home or store, such as landscape designs, exterior lighting, docks, fences, and the like. Owners often do not have adequate flood coverage or ignore other aspects or coverage deficiencies, which can result in catastrophic financial loss from even the lowest level of hurricanes. The enormous losses experienced by owners such as those living in coastal and suburban areas are burdensome to those who cannot afford themselves. Insurance companies provide a great deal of help to these individuals, but the economic stress caused by the abnormally active hurricane season has brought about a considerable premium. Various regulations and regulations have been enacted in order to ensure that insurance coverage continues to be available to individuals. However, considerable economic burdens still exist, such as high deductible amounts and exclusion items, which represent lost costs that must be borne directly by the individual. In addition, there is considerable delay in getting insurance relief due to a number of factors outside the owner's control, such as delays associated with claimant progress, claim processing, and government determinations. These delays are greatly extended when large-scale losses occur.

The problem seems to be insufficient, predicting that increased storm activity in the atlantic ocean over the past few years may continue within the following 15 to 20 years. One prediction in 2006 is that 17 named storms will occur, 9 of which may become hurricanes and 5 of which are expected to develop into major storms, with wind speeds of 111mph or higher. In contrast, 26 named storms were reported in 2005. Of the 13 major storms developed over the last two years, seven have struck the united states, and only one of each 3 reported storms would be considered a "major" storm, based on historical averages.

In addition to exacerbation of the bad weather, other factors are also mentioned as causes of unexpectedly large estimation losses. For example, it is estimated that by 2020, a miami storm can cause catastrophic losses of $ 5000 billion, which is 7 times as much damage as hurricane catalina. This is due to the increasing development of additional real estate required by the growing population and the increasing purchasing power caused by more personal wealth. These estimates have not included any expansion factors.

Other lessons were also learned from hurricane catalina. For example, a large miami hurricane in 1926 caused a loss of approximately 7 billion and 6 million dollars, measured in us $ 2004. Surprisingly, if a hurricane were to occur now (same size, along the same route), the estimated loss would be $ 1300 billion, primarily due to the growth of the population in that area. In 2020, the estimated losses caused by the same hurricane are expected to be as large as $ 5000 billion. In addition to major loss factors such as property damage, other factors are directly derived from natural events. For example, the Federal Emergency Management Agency (FEMA) has experienced significant difficulty in providing temporary accommodation for disaster victims. Widespread unemployment makes the situation of lost accommodation worse, further slowing economic and personal recovery. For example, FEMA's 2005 hotel program causes the federal government to spend 3 billion, 2 thousand, 5 million dollars and at its peak includes approximately 8 million, 5 thousand rooms.

Other natural activities can also be predicted to show striking trends. For example, tsunamis appearing in the next few years are expected to result in 600 billion dollars of catastrophic loss, endangering 100 million residents, affecting 60 million jobs locally and 250 million jobs nationwide. The seismic safety committee of california and other organizations have called for upgrades to local evacuation plans to account for possible catastrophic losses. For example, in one example, the loss estimate is to include port closures for los angeles and beaches. A two month port closure will lose 600 billion dollars and affect 60 million jobs in the state and 250 million jobs nationwide.

Disclosure of Invention

The present invention relates generally to conducting financial activity between a provider and a plurality of participants based on natural events such as tropical cyclones, tornadoes, or earthquakes. Participants have the opportunity to predict future natural events and make investment funds with the expectation that return on investment will be obtained when their predictions match the outcome of the natural event. For example, financial activity may be based on hurricane landing or on-land travel routes. Participants engaged in financial activities submit their predictions regarding future hurricane landing points and/or waypoints for travel on land. Successful qualified investors will share the pool of accumulated investment funds if their forecasts match the observed natural events. Preferably, the natural events are observed by external, objectively independent sources of information, the observations, discoveries and conclusions of which can be used in financial activities. Financial activity can take a variety of different forms, including games of chance, games of skill, protection of property value, derivative security interests, and secondary trading of financial assets by participants engaged in the financial activity.

In one implementation, the invention comprises a method of conducting a financial activity between a provider and a plurality of participants based on a natural event, including a method of participant prediction data for obtaining a natural event prediction result and a method of setting an investment price for each participant. A method provides for obtaining a participant investment fund paid at an investment price, and a method provides for recording the time of the participant's investment and a method provides for pooling the participant's investment fund in a common pool. A method is provided for obtaining information about natural events from an external independent information source, and a method is provided for comparing the forecast data of the participants with the external information to determine if there is a match result, and a method is provided for allocating funds from the pool to the participants with the match results.

In another implementation, the invention comprises a method for conducting a financial activity between a provider and a plurality of participants based on a natural event, including a method for each participant to provide predictive data to the provider related to the outcome of the natural event and a method for each participant to receive an investment price from the provider. A method is provided for each participant to provide an investment fund in an investment price payment manner, and a method is provided for each participant to receive information about a natural event, and a method for participants having matching results of a comparison of the participants' prediction data with natural event data about a natural event from an external independent information source to obtain an indication from the provider of the matching results, and a method is provided for participants having matching results to receive funds from a common pool of participant investment funds.

In yet another implementation, the invention encompasses a system for conducting a financial activity based on a natural event, comprising a financial activity module for facilitating a financial activity between a provider and a plurality of participants, receiving external natural event information from an external independent information source, and providing the financial activity information to the participants. The first communication module provides for communication between the financial activity module and an external independent information source to receive external natural event information from the external independent information source. A second communication module provides for communication between the financial activity module and the participants to transmit the forecast data regarding the natural event from the participants and to transmit the investment price to each participant. A comparison module for comparing the participant's prediction data with the external natural event information and for providing an indication of a match result to the participant, and an allocation module for allocating funds from a common pool of funds collected from the participant at an investment price payment to the participant having the match result. The various communication modules may be combined into one or more communication modules to perform one or more communication tasks, as desired.

In yet another implementation, the invention encompasses an article of manufacture comprising a machine-readable medium to cause a computer to provide a financial activity based on a natural event between a provider and a participant, the modules comprising modules to conduct the financial activity between the provider and a plurality of participants, receive natural event information from an external independent information source, and provide the financial activity information to the participants. A module is provided for performing communication activities communicated between the financial activity module and the external independent information source for receiving natural event information from the external independent information source, and a module for performing communication activities for communicating between the financial activity module and the participants for receiving forecast data about the natural events from the participants and for sending investment prices to each of the participants. The comparison module is to compare the predicted data of the participant with the indication of the occurrence of the natural event, and the communication module is further to communicate between the financial activity module and the participant to provide an indication of a match result to the participant based on the match result of the comparison step and to indicate to the participant having a match result in the comparison step that a portion of the fund is to be paid from the common pool collected from the participant.

In one aspect, the present invention can be used as a viable solution to economic and financial disruptions caused by naturally occurring disasters such as hurricanes, which affect citizens and governments. The present invention can be used to provide an economic solution that does not use government or public funds, thus eliminating the need for taxpayers to provide funds to replenish government reserves. In one aspect, the invention may be used to augment government financial assistance for catastrophic events using only funds provided by private institutions.

Drawings

The features of an exemplary implementation of the present invention will become apparent from the description, the claims, and the accompanying drawings in which:

FIG. 1 is a diagrammatic view of a financial activity network in accordance with an embodiment of the present invention;

FIG. 2 is a diagrammatic view of a financial activity apparatus implementing the present invention;

FIG. 3 is a diagram of a first participant terminal;

FIG. 4 is a diagram of a second participant terminal;

FIG. 5 is a point of purchase participant terminal illustration;

FIG. 6 is a diagram of an individual participant terminal;

FIG. 7 is a first data display illustration;

8a-8f are illustrations of a series of screen displays; and

fig. 9-12 together comprise a schematic flow chart representing one example of the operation of the system.

Detailed description of the invention

The invention disclosed herein is of course susceptible of embodiments in many different forms. Shown in the drawings and described in detail herein below are preferred embodiments of the invention. It is to be understood, however, that the present disclosure is illustrative of the principles of the invention and is not intended to limit the invention to the embodiments shown.

For ease of description, financial activity networks and other systems, articles of manufacture, and devices embodying the invention are described herein below in their generally assembled position as illustrated in the accompanying drawings, and terms such as upper, lower, horizontal, vertical, and the like may be used herein with reference to this generally position. However, the systems, articles, and devices may be manufactured, shipped, sold, or used in orientations other than those described and illustrated herein.

Brief introduction to the drawings

Online execution has been proposed for various financial activities. These activities can be divided in a number of different ways, such as gaming and non-gaming activities. The installed gaming and wagering system mimics traditional wagering activity in an online internet software-based program to provide the user with the look and feel of traditional wagering. Such gambling variations have extended to non-traditional games of chance based on virtually any experience known to humans. Although gaming activities may benefit greatly from certain aspects of the present invention, the present invention may also be used for games of skill and non-gaming financial transactions.

In one example, the invention relates to financial activities based on games of skill, in which participants process historical weather and other data and apply scientific principles and analytical skills obtained to arrive at educated decisions about the prediction of future naturally occurring events. In one example, participants make fund investments based on one or more educated decisions, thereby contributing to a common pool for reimbursement (payout) based on, for example, the accuracy, level of detail, and timing of their predictions.

In one example, the invention also relates to traditional financial activities outside the gaming scope. More particularly, in one example, the present invention relates to the allocation and management of funds collected from customers (i.e., investors) that seek to offset the unpredictable but still possible catastrophic financial burden of property loss due to natural events. In one example, these types of financial activities are based on the property interests of the participants. While such financial investments do sometimes have significant risk factors in return expectations and dollars, it has long been recognized that such financial investments do not represent gaming activities.

For those who live or are in a particular geographic area susceptible to natural events and whose property interests (e.g., residential, business, rental property, and vacation) are greatly impaired, the present invention is directly applicable to make up for their loss. In one example, the invention relates to making up for losses without government intervention. Examples of such natural events contemplated by the present invention include non-anthropogenic naturally occurring phenomena such as tropical weather events (especially tropical cyclones of hurricane intensity), tornadoes, earthquakes, naturally occurring wildfires, volcanic eruptions, avalanches, tsunamis, landslides and debris flows, floods, storm tides, drought, typhoons and naturally occurring outbreaks of disease. As will be seen herein, a detailed example of a financial activity will be described based on the first three natural events listed above.

A premise of financial activity is that investors can practice personal initiatives to study activities that are known to occur naturally and make certain predictions about upcoming activities for a particular season or year. Its return on investment may be paid back at the end of the year or once the natural event has ended, based on factors such as its accuracy of prediction, the amount of time between its investment and the occurrence of the natural event, and the use of skills in the knowledge of statistics and other established laws of resources available to investors. The time and effort spent investigating natural activities can help to improve the accuracy of predictions made.

External objective information source

In one example, the invention encompasses conclusions, findings, and reports from one or more external objective information sources, such as external, objectively independent, disinterest-free third parties that provide publicly available information and conclusions. The terms "external" and "independent" refer to entities that are separate from the provider and/or participants of the financial activity. In one example, the external objective information source provides information related to the natural event (in one example, an indication that the defined natural event has occurred, and in another example, an indication that the defined natural event has ended). In another example, an external objective information source provides natural event data, interpretations, and conclusions, such as landing sites from sea storms or ground travel routes.

In one example, the invention includes independent objective information in financial activities that is based on naturally occurring events (and in one example, preferably publicly available information) that are studied by external objective information sources. In one example, the financial activity contemplated by the present invention involves natural event activity prediction of a financial investment before the activity has occurred and/or ended. The redemption or allocation of points or other values based on the successful match results of the financial activity may be based on a number of factors, some of which may be determined by external sources of objective information, such as the measurable severity of the natural event, details regarding the occurrence of the natural event (such as its ground contact point or path), and the timing of the participant's investment (such as the amount of advance time given by the investor before the end of the event).

In many instances, external objective information sources rely on their expertise to study and measure natural event phenomena, as well as draw conclusions from data collected from natural events. Sometimes, reports available to the public and to other institutions include inferences and conclusions drawn by professional institutions that go beyond the facts observed by pure correlation. According to one aspect of the invention, information critical to conducting a financial activity, such as the time and place of occurrence of the natural activity, is obtained from a source external to the financial activity provider.

As will be seen herein, it is generally preferred that the identity of the external objective information source is defined in advance in a rules database or in some other manner. In one example, an external objective independent source of information provides facts and conclusions that are generally available to the public or at least individuals who are likely to participate in financial activities. In this way, individuals interested in participating in financial activities and those already engaged in financial activities can monitor the progress of natural events without being limited by financial activities or their external information sources. In one example, the present invention contemplates that a participant engaged in a financial activity will be able to readily obtain professional information and skill-building technical intelligence from sources unrelated to the financial activity to thereby increase the participant's motivation to engage in the financial activity with a greater likelihood of enjoying successful outcomes. Of particular interest here is the owner who cannot be properly assured but still lives in an area known to be vulnerable to disruptive natural events. Such owners would be interested in the ability to predict natural events so as to be able to better protect their property interests and make up for unforeseen damage.

Examples of external objective independent information sources include national hurricane centers for hurricanes and other tropical storms, national weather bureaus and storm forecasting centers for tornadoes in the united states, and geological survey bureaus, national seismic information centers for earthquakes in the united states.

Natural event examples

Several examples of natural events that can be independently observed, moved, or otherwise varied, particularly those events that can cause significant damage, will now be discussed.

Tornadoes are ground-contacting, strongly rotating air columns that extend from a particular type of cloud called "rain clouds". Tornadoes can be classified as "weak", "strong", and "strong"; weak tornadoes often have a string-like appearance, rotating at wind speeds no greater than about 110 MPH. Typical "strong" tornadoes often have identifiable tunnel-type clouds with high energy in a rapidly rotating updraft and rotating wind speed range between 110 and 200 MPH. Tornado severity was also measured according to the Fujita scale.

Scientific tornado research was performed by the National Strong Storm Laboratory (NSSL), which has been the leader of doppler radar development, research and testing, and many field work programs have been developed to study tornados and other inclement weather. The NCAR (national atmospheric research center) located in bolder, colorado and TORRO located in the uk also conducted tornado studies. Almost every university with atmospheric science projects and many local National Weather Service (NWS) offices have also published some research on tornadoes. The national weather service is a branch of the U.S. government agency of commerce and the National Oceanic and Atmospheric Administration (NOAA). In the united states, the National Weather Service (NWS) issues national tornado forecasts. The alert originates from each local NWS office. The storm prediction center located in noman, oklahoma is a subordinate organization of NOAA/national weather bureau and national environmental prediction center, issuing early warnings and adverse weather prospects. Information about tornadoes in canada is managed by the canadian weather authority.

Tropical cyclones are low pressure weather systems formed at sea and low latitudes, beginning with lower energy tropical low pressures. When storm energy accumulates, tropical low pressures begin to show a spinning or circulating weather pattern and are classified as tropical cyclones when the storm intensity is sufficient. Tropical cyclones include "tropical storms," but the most intense tropical cyclones are known as (depending on the sea area in which they occur) hurricanes, "" typhoons, "or simply" cyclones. According to the national hurricane center, a "hurricane" is the name of a tropical cyclone that occurs in a marine area commonly referred to as the atlantic sea area and is defined by certain minimum wind speeds. The general term "tropical cyclone" is used for high intensity low pressure systems that are formed in the tropical zone and meet the higher minimum sustained wind speed standards. The intensity of hurricanes is measured according to the Saffir-Simpson scale.

It is well known that hurricanes and lower energy tropical weather events develop from tropical low pressures in the ocean where weather-related factors form and contribute energy to the low pressure weather system. The weather system then travels across the ocean along unpredictable paths. Of interest here are weather systems that exhibit cyclic behavior that may increase in intensity in order to create hurricanes that generally travel to the west and land or otherwise contact property along well-defined geographic areas, such as the east coast of canada, the united states, mexico, south america, and islands in the sea in the path of travel toward those lands. The storm categories known as hurricanes vary in intensity and are generally free to travel along their own unique trajectory or "course". Hurricanes are observed by independent professional organizations of the U.S. government such as the national hurricane center (an example of an external objective information source), which records, analyzes, and later publishes reports, findings, and conclusions, all of which are publicly available.

Earthquakes are ground shocks caused by the sudden breaking and displacement of a large part of the earth's lithologic envelope. The earth is divided into three main layers-a hard outer crust, a soft middle layer and a central core. The outer crust breaks into large, irregular pieces called "slabs". An earthquake is associated with sudden movements or jolts in the earth caused by the sudden release of slowly accumulated stresses in the earth's panels. It is reasonably expected that future earthquakes in known seismic regions will have magnitudes generally similar to past seismic magnitudes. Seismologists use a seismograph scale, such as the Richter scale, to represent the seismic energy released by an earthquake.

Typical seismic effects can range from Richter magnitude of less than 3.5 (usually imperceptible, but still recorded) to Richter magnitude of 8 or more (so-called "major earthquakes," which can cause severe damage over large areas measured over hundreds of kilometers). Although earthquakes may have similar magnitudes, their effects may vary greatly depending on distance, ground conditions, and man-made building techniques. Independent third party research is publicly available as reported by the U.S. geological survey. For example, the U.S. geological survey reports seismic density maps in the united states, as well as seismograms and seismogram displays of recent seismic activity in the united states and the world. The united states geological survey, national seismic information center, denver seismology world data center, published detailed reports of major seismic activity in the united states local area and maintained a seismic catalog of data useful for seismic prediction.

The above illustrates exemplary natural event aspects that may direct the operation of a financial activity in a rules database or program or other structure. It is important to define as early as possible those natural events that qualify for consideration by the financial activity. For example, financial activity considered tornadoes may be limited to those with ground contact or with minimal intensity. In another example, it is important to define natural events for financial activity considerations when members of the public may have alternative definitions that are different from those for financial activity considerations. For example, a participant who suffers damage during a tropical cyclone may not be within the "most likely route" published by an external independent objective information source (e.g., NHC/TPC) that financial activity sets up as a conclusive source of such information. That is, contrary to the public expectation, a particular participant may suffer from damage from natural phenomena not involved in financial activities.

Financial Activity model example

The present invention contemplates that different types of financial activities will typically be performed between a financial activity provider and one or more participants of a financial activity. Various models of financial activity are contemplated in accordance with the principles of the present invention, including:

1. lotteries or other games of chance, such as those monitored by state and local governments.

2. A game of skill, preferably a participant, must demonstrate the level of skill associated with a natural event of interest.

3. Property value protection, particularly financial activity that screens participants for eligibility to engage in financial activity based on some indication of the participant's property rights in the geographic area covered by the financial activity.

4. Derived transaction types for financial campaigns, such as those involving derived vouching equity, are typically monitored by securities and exchange committees or other overseeing agencies such as the futures exchange commission (an independent agency of the U.S. government), the new york stock exchange, the chicago trade exchange, the iowa electronic market, and the like.

5. The secondary trading of financial assets developed by the one or more financial activity participants described above is particularly a secondary trading between an ongoing financial activity participant and a third party to trade directly with the participant rather than with a financial activity provider. A financial activity provider may have to register a secondary transaction or exert other control over the parties involved, including instruments that assist in performing transactions between two or more participants or non-participants, such as registering transactions.

6. Price oriented competition is preferred in games of skill where participants are charged a "fee for entry" to engage in skill competition with other participants. The allocation or "reward" to eligible participants is predetermined at the beginning of the competition and is therefore not affected by variability factors. However, if desired, the "admission fee" may be adjusted based on factors such as those variability factors related to the time interval between the investment and the event outcome and the probability of successful outcome that is generally determined at the time of the investment.

Financial activity network

Referring now to the drawings, and beginning with FIGS. 1-4, a financial activity system 100 in one example takes the form of a financial activity network, generally indicated at 10. In one example, the network 10 includes a central management system 12 linked to a plurality of participant terminals 14-18. The terminal may comprise, for example, virtually any device that provides for communication with a workstation, such as a network or other computer, including desktop, portable, laptop, or mainframe computers, data terminals, dumb terminals, personal digital assistants, cellular telephones, or other electronic devices having communication capabilities. Throughout the description given herein, the invention contemplates that a "computer" refers to a computer system that includes one or more computing devices.

As schematically shown in fig. 1, each participant terminal communicates directly with the central management system 12 via a communication network component 15, allowing simultaneous transactions and data transfers. Other types of arrangements are also possible. For example, the communication between the central management system and the participant terminals may employ virtually any communication technique now known. The geographical separation between the central management system and the participant terminals may have virtually any scale as desired. For example, the entire network 10 may be located in a single room, or in a single building or complex building or campus.

As will be seen herein, financial activity may be performed according to different models. One model relates to derivative transaction types for financial activities, such as those activities that relate to derivative vouching interests. In this type of financial activity, the central management system 12 preferably includes a brokerage system in communication with the exchange system. Preferably, the participant's transaction is conducted through the brokerage system prior to being conducted with the exchange system. If desired, in this type of financial activity, the brokerage system may be omitted and the participants trade directly with the exchange system. If desired, a central management system may be included in the switching system, or otherwise provided.

Alternatively, the financial activity network 10 may be located in different locations throughout the country or throughout the world, as may be desired. As yet another alternative, the financial activity network may take any form, and may for example employ wires, cables, or wireless components. Network 10 may be configured as an open connection or network such as the internet, a wide area network, a telephone network, a satellite network, an on-line network, or a closed circuit television network, or similar infrastructure network. The network 10 may also take the form of an ethernet arrangement, token ring, token bus, or other suitable communication arrangement or configuration of linkable workstations, particularly workstations including one or more data processing computers.

The present invention expressly contemplates that financial activities may, but need not, occur within or across local, state, federal, national or international boundaries. For example, participant terminals may be located in one or more boundaries, such as political boundaries, as opposed to a central management system. As yet another example, while the central management system and participant terminals are located within a given boundary, such as within a given political boundary, the central management system may communicate with external objective independent information sources, external credit agencies, or other agencies located within one or more different political or geographic boundaries.

The terminal may comprise one of many different types of electronic devices now known, including a programmable computer, a telephone, a standalone machine, such as an ATM, a television or set-top box unit, a credit card reader, a kiosk terminal, a point-of-sale register, or a standalone unit like an arcade game. The terminal preferably includes an input device adapted to receive purchase requests or other data from participants, such as those used by purchasers to obtain goods and/or services from merchants. The input device may take many forms, including, for example, a keypad, keyboard touch screen or mouse or remote control device, a contactless payment system or a fingerprint or other biometric system. The systems, articles of manufacture, and apparatus contemplated by the present invention preferably comprise digital devices, but may also comprise analog or hybrid electronic or non-electronic devices, as desired.

System device

Turning to FIG. 2, the financial activity system 100 includes a system device 13 including a central management system 12 as shown in FIG. 1. In one example, system device 13 includes one or more storage devices 20, one or more processors 22, and one or more interface components 24. In one example, the processor 22 includes a central processing unit ("CPU"). Processor 22 executes one or more instructions of one or more programs 30 under the control of an operating system 35 containing one or more system programs 37. In one example, program 30 includes one or more subroutines and one or more variables, as will be understood by those skilled in the art. In one example, storage device 20 includes at least one instance of a recordable data storage medium, as described herein. The storage device 20 stores a program 30 and one or more databases 32 and one or more data files 34.

In one example, the interface component 24 includes a graphical user interface ("GUI"). In one example, the interface component 24 allows a service provider or other user 38 to execute one or more programs 30. In one example, the program 30 includes one or more subroutines to perform the financial activity methods and operations to be described herein. In one example, the program 30 includes one or more subroutines to collect, publish, interpret, or otherwise process information supporting financial activity operating rules and other aspects. In another example, the program 30 includes one or more subroutines to implement the operational principles of the financial activity.

In another example, the interface component 24 allows the user 38 to verify or otherwise interact with one or more results of the program 30. In yet another example, interface component 24 allows user 38 to set one or more input values or operating parameters for program 30. In the preferred embodiment shown in fig. 2, the interface component 24 includes a display device 42 and a data input device 44 that allow the user 38 to set up the central management system according to the desired operational goals. Through the interface component 24, a user can access, read, or write to the programs 30, databases 32, and data files 34.

Included in the device 13 containing the system 12 is a communications port 50 that provides bi-directional communications with the terminals 14-18. The communication port 50 may communicate or otherwise know content using virtually any communication protocol, data format, and other organization now in use. It is generally preferred that the communication network employed between the central management system and the participant terminals comprises interactive means in any suitable form.

In one example, the financial activity system 100 includes a plurality of components, such as one or more electronic components, hardware components, and computer software components. Multiple such components may be combined or separated in the financial activity system 100. An exemplary component of the financial activity system 100 employs and/or includes a set and/or series of computer instructions written or implemented in any of a number of programming languages, as will be appreciated by those skilled in the art. In one example, the financial activity system 100 includes any orientation (e.g., horizontal, inclined, or vertical), and for ease of explanation, the description and drawings herein illustrate one exemplary orientation of the financial activity system 100.

In one example, the financial activity system 100 employs one or more machine (e.g., computer) readable (hereinafter "computer-readable") signal-bearing media. The computer-readable signal-bearing media stores software, firmware, and/or assembly language for performing one or more portions of one or more embodiments of the invention. Examples of computer-readable signal-bearing media for financial activity system 100 include storage components such as one or more storage devices 20. In one example, the computer-readable signal-bearing media of the financial activity system 100 may include one or more of magnetic, electrical, optical, biological, and atomic data storage media. For example, computer-readable signal-bearing media may include floppy disks, magnetic tapes, CD-ROMs, DVD-ROMs, hard drives, and electronic memory. In another example, a computer-readable signal-bearing medium includes a modulated carrier signal transmitted over a network that includes or is coupled to financial activity system 100, such as one or more of a telephone network, a local area network ("LAN"), a wide area network ("WAN"), the Internet, and a wireless network.

Data structure

Referring to fig. 2-4, in one example, the databases 32 include a participant database, an administrator or system database, a credit provider database, a storm warning database, a rules database, and a push database. The credit provider database contains a list of credit providers and payment methods accepted by them, as well as any credit-related information of any type, such as authorization codes typically provided to merchants, etc. to authorize transactions acceptable to the credit providers. The credit provider database may also contain other financial information associated with the credit provider, such as the credit provider's identification number and account information. In a preferred embodiment, the system administrator preferably provides services in one aspect, similar to those of merchants selling goods and/or services to participants. If desired, the system administrator may include resellers of goods and services such as proprietary weather reports and drawings or weather information, as well as maps, forms, and other related materials.

The participant database maintains a list of participants and their associated personal financial information. The participant database stores a set of personal payment methods registered by the participants with the transaction processing service, which in the preferred embodiment is used by the system administrator as an admission to the participants. The participant database also includes other information regarding the participant's eligibility to participate in the financial activity. In a preferred embodiment, the system administrator implements those rules that are formulated regarding the limits on participation using well-known screening services. For example, a system administrator may choose to fulfill a request of a government official to curtail or otherwise limit transactions originating from or delivered to those areas where evacuation instructions or one or more legal constraints are to be enforced. Additional details regarding the exemplary screening service are provided in U.S. patent No.6508710, published 21/1/2003, the disclosure of which is incorporated herein by reference in its entirety. The geographical location information of the participants may be used when an advisory and/or warning is issued by a governmental agency to discourage further participant activity in areas officially declared to be at risk.

The storm warning database tracks storm activity of interest to the participants. For example, a cyclic storm system that has not yet become a hurricane but is likely to become a hurricane. If desired, the participant may be given historical data about previous storm systems on an unlimited basis or by additional payment by the participant.

The administrator database contains data and other information needed to operate the financial activity. Including, for example, the sum of the number of participants in ongoing "real-time" or "change", the sum of all funds invested, the number of other participants sharing the participants' predictive choices, and the amount of funds the other participants invested. If desired, the administrator database may also include real-time estimates of the tender amount corresponding to the participant predictive selection, assuming that the selection is validated accurately. The administrator database may also include a list of known users who are prohibited from participating or otherwise restricted from participating in the activity. This information may be contained in a separate database, if desired. In addition, the administrator database preferably contains participation statistics and financial statistics for providing updated estimates of the cost of transactions for operating financial activities. If desired, adjustments may be made with respect to future participants to cover fluctuations in cost of marketing.

The rules database contains the operating rules or other principles of the financial activity. The rules database contains a set of "rules" or guidelines that guide an ongoing financial activity in a specific or general manner (e.g., rules that define an authority or external objective independent information source upon which to base a judgment or conclusion upon which a fact is ultimately based). Examples of such authorities include external, objective, independent, professional government agencies responsible for monitoring natural events and processing related data. The rules also include qualification requirements, personal financial payment requirements, and sliding scales that affect repayment such as time selection and deadlines.

The rules may be fully or partially public (i.e., available to participants) or private (i.e., available only to those authorized by the system administrator). In one example, the rules database also guides the process by which particular aspects of the financial activity are conducted. For example, in one example, the rules include definitions relating to natural events to be considered by the financial activity, external objective independent sources of information governing the information about natural events and metering data that will be relied upon during the course of the financial activity, and parameters associated with the natural events, particularly those parameters that uniquely define each particular natural event, as well as parameters that determine reward points or other values.

Points or other values relating to the reward of the participant may be "hidden" or contained within one calculation, if desired, and need not be represented in the display reference. In another example, the rules database contains definitions of those participants eligible to engage in financial activities, as well as those participants eligible to be qualified last winners ("winners") or otherwise eligible for compensation. In yet another example, the rules database contains operational principles that guide the transfer of funds between the financial activity and the eligible participants. The rules database may also guide the participants with access to certain information about the financial activity, such as the number of individuals participating, the current average or maximum financial investment, and the rough sum of funds currently collected for the event of interest.

In another example, the rules database may include operational principles related to security and public interest considerations. For example, a rules database may be provided for automatically suspending operations when evacuation is publicly announced or preparation for evacuation of a particular area is suggested. The rules database may provide for selective activity based on participant location. For example, the suspension of financial activity may be limited to only those countries or other areas where government security warnings have been issued, while financial activity is allowed to continue in those areas not affected by government warnings.

The push database contains information for generating interest and encouraging participant activity. For example, the push data may include recent designations of official approved storm systems that may be candidates for future investment opportunities. The pushed data may also include a brief analysis and/or statistics of ongoing or recent natural events. Different amounts of push data and different lists of push participants may be set up by the computer program according to predefined "trigger levels," such as storm location, intensity, and speed. The push database may also include operational rules related to the push data, such as a local time to send or not send the push data.

The data files include data information that is preferably relatively static, such as official designations of natural events to be released during upcoming event seasons, official and unofficial historical reports of natural event activities, and statistics compiled from historical information. If desired, the data file may be replaced with one of the available databases, or a dedicated database may be provided.

The land area database may contain geographic items such as maps and other data related to conducting financial activities. For example, in the United states, maps of those states at risk of a hurricane attack may be provided. Preferably, the map will be "clickable," allowing the participants to easily indicate the state of interest. In response, a more detailed map, such as a county map within a state, would be displayed to the participant, and would likewise be clickable, to provide a ready indication of the participant's selection of the predicted attack area. This same functionality may be provided in a tabular form or in some other form that facilitates user involvement, if desired. In addition, a cross-reference "finder" tool may be provided for receiving ZIP code information or the like and selecting a colored or other visually highlighted area on the displayed map, or a textual response to a query, ready for the participant to select the area shown. As noted above, it is generally preferred that the map, table or other geographic location information contain a visual indication of those areas outside the scope of the financial activity, providing an ineligible ready indication to participants investigating their likely forecast selections. The geographic location data may be linked to weather or climate data for a given area, if desired.

The weather database is preferably provided for weather, meteorological or climate information. The weather database preferably contains historical information that is helpful to those participants who are ready to predict future natural events.

Participant terminal

Referring now to fig. 3, the terminal device 58 includes one or more participant terminals 14-18 and includes a communication port 60, one or more processors, preferably including a central processor 62, and a memory storage unit 64. Also included is an interface assembly 68 that preferably includes a display 70 and a data input device 72. The interface component 68 allows participants or other users 76 to communicate with the device 58 and, in turn, with the device 13 of the central management system 12.

Turning now to fig. 4, a terminal device 80, comprising another example of a participant terminal, includes a communication port 60, one or more processors, preferably including a central processor 62, a memory storage unit 64, and an interface component 84. In the arrangement shown in fig. 4, the interface assembly 84 includes, in addition to the display 86 and data input device 88, a card read/write device 92 and an output device 94 for issuing printed receipts confirming the participant's transaction.

Referring additionally to fig. 5-6, two additional examples of participant terminals are shown. Referring to fig. 5, the participant terminal 200 shown therein includes a display 202 for displaying information about a selected natural event, a user interface integrated with the display for viewing event information and investing in the selected natural event, an optional card read/write device 206 for receiving an electronic or magnetic stripe card encoded with account information of the participant, an optional ticket issuing device 210 for providing tickets including purchase information of the selected natural event, and a housing 214 for securing the display, the user interface, the card read/write device, and the ticket issuing device.

The participant terminal 200 also includes a processor and may also include a speaker (not shown) for playing audio associated with the financial activity information. The display preferably includes a CRT or flat screen display 218 for displaying information about the natural event and preferably the display includes a touch display containing a touch screen (not shown) in communication with the processor for selecting the desired investment information as the desired investment share and "scrolling" between the next and previous information. Any suitable type of display may be used, as will be appreciated by those skilled in the art.

Turning now to fig. 6, another embodiment of at least one participant terminal, generally designated 230, is shown including a display 232 for displaying information regarding a selected physical event, a user interface 236 for viewing event information and making investments, an optional card read/write device 240 for receiving an electronic or magnetic stripe card encoded with account information of the participant, an optional ticket issuing device 242 for providing tickets including purchase information for the selected physical event, and a vertical housing 250 for the fixed display, user interface, card read/write device, and ticket issuing device. The participant terminal also includes a processor (not shown) for facilitating financial activities. The participant terminal 230 may also include a speaker (not shown) for playing audio associated with the financial activity information. The examples shown in fig. 5 and 6 are merely exemplary implementations of at least one participant terminal, and other configurations are contemplated. For example, the user interface may include a plurality of hardware or software buttons, each button identifying a different function that facilitates various aspects of the financial activity.

Central management device

In one example, the central management device 13 and participant terminal devices (collectively "devices") include a plurality of components, such as one or more of electronic components, hardware components, and computer software components. Multiple such components may be combined or separated in a device. An exemplary component of the device employs and/or includes a set and/or series of computer instructions written or implemented in any of a number of programming languages, as will be appreciated by those skilled in the art. In one example, the device includes any orientation (e.g., horizontal, oblique, or vertical), and for ease of explanation, the description and drawings herein illustrate one exemplary orientation of the device.

In one example, an apparatus employs one or more computer-readable signal-bearing media. A computer-readable signal-bearing medium stores software, firmware, and/or assembly language for performing one or more portions of one or more embodiments of the invention. Examples of computer-readable signal-bearing media for the devices include the storage components 20, 64. In one example, the computer-readable signal-bearing media of the apparatus includes one or more of magnetic, electrical, optical, biological, and atomic data storage media. For example, computer-readable signal-bearing media include floppy disks, magnetic tapes, CD-ROMs, DVD-ROMs, hard drives, and electronic memory. In another example, a computer-readable signal bearing medium may include a modulated carrier signal transmitted over a network that includes or is coupled to a device, such as one or more of a telephone network, a local area network ("LAN"), a wide area network ("WAN"), the internet, or a wireless network.

Graphical user interface

Turning now to fig. 7 and 8a-8f, and beginning with fig. 7, the program 30 includes one or more subroutines for communicating with participants located at remote participant terminals. In one example, the program 30 includes one or more subroutines for generating one or more screens for performing a plurality of functions, including sending and receiving information to and from participants. In FIG. 7, window or screen 300 schematically represents a summary screen of participant John Doe, indicated at 310. As described above, screen 300 is a summary screen and is used with multiple support screens that query participants for specific information such as participant names, and receive response information that is then reviewed for form and content, recorded in one or more databases such as participant databases, and reported in area 310.

Other support screens receive other participant application information, such as the participant's location of residence or other property possession and information regarding the participant's credit information. After reviewing the credit and other qualifications of the participant, the participant's account is opened and details regarding the account, credit qualifications, and other related financial information are stored in one or more databases, such as a participant database. The summary screen 300 is then presented to the participant confirming the participant's active status in the financial activity. During this process, one or more queries, multiple data selections, multiple activity selections, or other interactions with the participant are listed in area 314.

Each selection displayed to the participant may have an adjacent check box 318 provided for ready data input into the program 30, if desired. If desired, one or more command buttons 320-330 may be provided for the user to execute one or more commands or otherwise control some portion of the data stored in one or more databases or some portion of the program 30 dispatched to the participant by the system administrator. If desired, an area 334 may be provided to display context-sensitive rules of the game to the participants, or to provide appropriate prompts or other helpful information. A check box 336 may be provided next to each entry in the window or pane 334 to allow the participant to obtain further information about the topic of interest, if desired.

In area 340, the participant is alerted that the current operation is being performed by program 30. If desired, a series of actions occurring in area 340 may be listed in area 344 along with an indication of the appropriate response by the participant. The information in area 344 may be saved or printed using command buttons 328, 330, as needed, thereby providing the participant with a written record of the activity being obtained in electronic or printed form.

Turning now to fig. 8a-8f, a series of exemplary data entry screens are shown. These screens generally relate to the location selection of the investment selected by the participant. For example, if the natural event is a tornado, the location may be where the participant predicts that a tornado attack will make ground contact. If the natural event is an earthquake, the location may be the epicenter of the earthquake attack. If the natural event is a tropical cyclone, the location may be a landing site, or some point along the course of travel on land for the tropical cyclone. Landing may be defined in any number of ways. For example, a landing may be measured in terms of the wind eye of a hurricane, the computing center of a hurricane, or some other structure of a hurricane. Referring to FIG. 8a, screen 400 displays a map 402 of a land area, preferably subdivided into smaller sections, each of which is selectable by a participant, or shaded or otherwise visually highlighted for the participant, to indicate areas unsuitable for financial activity.

Rules stored in one or more digital libraries may provide further information about this topic of the ongoing activity, if desired. Preferably, each of the subdivided portions of the map 402 is selectable by, for example, a touch screen, a click, or a stylus device. In one example, it is also preferred that the participant-selected area 406 be shaded, colored or otherwise made visually prominent to graphically indicate the selection made by the participant. In FIG. 8a, region 406 ("circled county") is selected by the participant and has highlighted contrast color values to provide visual feedback to the participant. As shown in FIG. 8a, screen 400 also includes a query to the participant to confirm and finalize the location selection.

Turning now to FIG. 8b, a screen 410 is shown prompting the participant to expand the illustrated area to include one or more surrounding areas. In screen 410, the enlarged area 412 surrounding the initially selected location 406 becomes flashed off, or has a color change. Optional text messages are displayed to draw the attention of the participants to the benefit of extending the selected location at which the natural event attack is predicted to occur. The participant may indicate additional locations, for example, by pressing the shift key.

In one example, game rules may be established to allow the use of so-called quadratic parameters. These secondary parameters require that the participant not only select the attack location of the natural event, but also indicate some characterization factor associated with the natural event, such as tropical storm intensity measured according to the Saffir-Simpson scale, according to the numerical category value.

Another example of a secondary parameter for an earthquake might be the duration of the initial or primary earthquake, and such a case is considered in fig. 8c-8 f. Referring to FIG. 8c, screen 420 provides notification to the participant that secondary parameters are to be provided in addition to the location of the attack. In fig. 8d, a drop down window 424 is provided in screen 426 to indicate a range of values that the participant is to select as the predicted duration of the initial seismic attack. In fig. 8e, it is assumed that the participant has previously expanded the attack location area that the selected investment or "bet" is to cover. In screen 430, 71/2 seconds selected by the participant are confirmed, along with an invitation to expand the participant's wager on time and land areas. In fig. 8f, screen 440 displays the range of time lengths selected by the participant. Followed by a screen (not shown) summarizing the participant's wager. For example, for the investment shown in FIG. 8f, the user has selected 9 geographic regions and 3 time lengths, totaling 27 (9 regions x 3 time lengths) purchase costs. In one example, it is generally preferred that this aggregate sum of purchased shares be reported in area 344 of screen 300 shown in FIG. 7.

Method and operation

For ease of explanation, a graphical illustration of exemplary operation of the system is shown. Fig. 9-12 illustrate a series of steps to be performed during the course of a financial activity. These method steps may be implemented in a number of different ways, including, but not limited to, execution of the program 30 by the central management device 13 and one or more participant terminals, for example. The program 30 may be implemented by a general-purpose computer or a dedicated electronic device, for example. Method steps may be incorporated into an article of manufacture such as a data storage device. As will be seen herein, the steps shown in FIGS. 9-12 indicate the portion of the financial activity that is performed from the perspective of a system administrator.

Referring first to step 500, a financial activity is initiated by virtually any suitable means. For example, if the operating rules specify that a financial activity is to begin at a given date and time, the start step 500 may be implemented in software that monitors the system clock and executes program code that publishes to the participants an invitation to engage in the financial activity from the referenced date and time. Alternatively, initiation of the start step 500 may be initiated by a system administrator pressing a key switch or otherwise activating a switch to initiate the transmission to indicate to the participants that the financial activity season has begun. According to some aspects of the invention, an event season may relate to a single natural event or multiple different natural events or portions of an ongoing natural event. In one example, the event season is defined by calendar date, the number of times a defined natural event occurs, or a mixture of both, or may rely on external objective independent information source reports or other data dissemination.

In step 502, in addition to declaring the beginning of the season of the financial activity, an optional proposal makes available certain operating rules that guide the financial activity of the operating season. In step 504, application information is obtained from the participant. This information may include, for example, an indication of the identity of the participant, the location of the residence or property interest of the participant, and credit information that allows a system administrator to authorize the participant for the need to open the participant's account. Preferably, the system administrator predefines acceptance criteria in the rules that guide the financial activity. As is currently done by many merchants who offer goods or services for sale, these rules may include intervention by an external authority that uses a system administrator as a broker, such as an external credit authority from which participants purchase credits.

In step 506, the application information is reviewed and a decision is made in step 508 whether to accept or reject the application by the participant. For example, a participant's application may be denied because the participant fails to disclose the property interests required for the financial activity based on property losses caused by the occurrence of natural events. If the participant's application is denied, control passes to step 511, which sends a termination message to the participant and returns control to step 504.

If the participant's application is accepted, control passes to step 510 where credit information is obtained from the participant. The credit eligibility of the participant is reviewed in step 512 and a decision is made to accept or reject the participant based on the increased requirement for appropriate credit eligibility in step 514. Likewise, if the participant fails to meet sufficient credit eligibility, control passes to step 511, where a termination message is sent to the participant, and then control passes to step 504. If the determination at step 514 is positive, indicating acceptance of the participant's application and credit eligibility, control passes to step 516, where the participant's validity status with respect to the financial activity is confirmed. Such confirmation may be indicated, for example, by a report presented by screen 300, as described above with reference to fig. 7.

Referring to FIG. 10, in step 518, a prediction entry is requested from the participant. In this step, the participant provides information defining the investment to be made. Upon confirming the unique identity of the natural event, the participant declares a parameter information that, in one example, includes a location of a predicted terrestrial attack of the natural event. Thereafter, the participant declares any secondary parameters required to operate the rule, such as the severity of the attack and the length of the attack. In step 520, forecast entries and other investment information are obtained from the participants and stored in one or more databases for future reference. In one example, the time at which the investment information is obtained is recorded and stored with the investment data of the participants. In one example, where later investments benefit from accumulated knowledge that benefits from the ability to predict the occurrence of an event, the amount of reimbursement or compensation to successful participants is weighted according to the amount of time between the investment transaction and the occurrence of the event, with greater lengths of time being more beneficial.

The investment information is reviewed in step 522 and a determination is made in step 524 as to whether the investment information is accepted. If the investment information is rejected in step 524, control passes to step 526, where an error message is sent to the participants, and control passes to step 518 to repeat the information collection process. If desired, step 526 may provide or display relevant information to the participant to assist the participant in improving the skill level of the prediction. If desired, participants may be asked to answer a number of questions regarding skills involved in predicting a particular natural event.

Assuming the investment information is in the correct form and meets other automation criteria, control passes to step 528 where the investment information and the current time are recorded. The system administrator has the option of determining which point in the ongoing financial activity considers the participant to have completed the investment process in order to determine the time difference between the investment and the occurrence of the natural event. For example, the time recorded in step 520 or 528 (or some other time as needed) may be used. As yet another alternative, the system administrator may wish to delay assigning investment time to the participant until funds for the transaction have been obtained from the participant. As a concession to the participant, the system administrator may temporarily specify the investment time in an earlier step.

Assuming that the investment information has been successfully obtained and recorded, control passes to step 530 where the necessary funds are collected from the participants. The payment capabilities of the participants may be guaranteed in advance, if desired, to eliminate any time delays at the moment in the ongoing financial activity. In step 532, the investment of the participant is confirmed, for example, by an entry of the summary screen 300. Referring to FIG. 11, control then passes to step 534, where an external objective independent information source is contacted that observes the natural events and manages information related to the natural events, and optionally makes relevant decisions, such as specifying severity based on a given measurement scale.

In general, it is preferable that the system administrator not require decisions regarding the occurrence of natural events, such as primary and secondary event parameters. In one example, a system administrator specifies in operational rules that financial activities will rely on a specified external objective independent information source to obtain information about the occurrence and characteristics of natural events and other parameters upon which an investment is based. In step 534, a connection to an external objective independent information source can be initiated or previously obtained data from the external objective independent information source can be accessed for use in a financial activity. In step 536, the ongoing developmental updates received from the external objective independent information source may be published to benefit existing and potential participants. In one example, the updates are made on an ongoing "live" basis with little or no time delay, or at least some time before the natural event ends.

In step 538, the information of the external objective independent information source is queried to determine whether the external objective independent information source has determined the onset of a natural event of interest for the financial activity. If the event has not started, control passes to step 536. When the external objective independent information source determines that an event has started, a unique identifier of the natural event is assigned and recorded to one or more databases. In one example, the unique identifier is then associated with each investment made by the participant with respect to the natural event. In step 540, the start of the event is reported to the participant and the event start time as determined by the rules "official" of the system administrator is published or otherwise made available to the participant and recorded in one or more databases for possible future reference by the financial activity. In step 544, if the event has not ended, a persistent update on the progress of the event is available and, in one example, reported to or otherwise made available to the participant.

Once the event has ended, control passes to step 546 to determine whether the financial activity has stopped. In one example, a system administrator provides operating rules that define the start and end times of a financial activity season. This may be based on any date and time, or on the occurrence of a particular event, such as the fourth, fifth or sixth tropical cyclone that occurred since the beginning of the season. In one example, the end of one season may be followed by an immediate or delayed start of a subsequent season. For example, subsequent seasons may be declared by the system administrator to provide financial investments based on the fourth, fifth or sixth tropical cyclonic event occurring in a given hurricane season, as defined by, for example, a national hurricane center.

Referring now to fig. 11 and 12, if it is determined in step 546 that a season has ended, the financial activity season is ended in step 548 and the accumulated data and other information is reviewed in step 550 to determine and identify the last winner that has been successfully predicted for the relevant natural event, as specified in the operational rules for the financial activity. In step 552, a plurality of calculations are made in preparation for reimbursement to the successful last winner. In one example, calculations are made to determine total fund holds, reward points for each last winner, management and operating expenses associated with conducting financial activities, and the amount of the reward fund for each last winner. In one example, the reward points are based on a single parameter, which is preferably the location of an attack on a natural event. In another example, reward points are determined not only by the location of the attack, but also by other natural event parameters, such as secondary parameters or other parameters.

In one example, a single primary parameter is defined by a system administrator in the system operating rules. In another example, one or more secondary parameters are also defined in the system operating rules. In yet another example, the secondary parameters are assigned a smaller weight than the primary parameters. In any case, the primary and secondary parameters, if any, may have equal or unequal weighting, as may be desired. In one example relating to a hurricane event, the location of a hurricane strike is defined as a primary parameter, wherein the time delay between the time of investment and the time of the hurricane strike at the investment location is defined as a secondary parameter.

In one example, the time delay quadratic parameter is weighted less than the primary parameter. In another example, the severity of a participant declared natural event at a predicted location is defined as a cubic parameter, and the quadratic and cubic parameters are assigned unequal weights. The present invention contemplates determining reward points based on mathematical formulas, algorithms, or other operations that do not require human intervention when performed. Thus, a formula, algorithm, or other operation may be included in an analog or digital electronic circuit or hydraulic circuit, for example. Points of consideration may be determined upon or based on confirmation of the participant's property interests as needed, and particularly for providing financial activities that avoid property loss.

In step 554, the reward fund is redeemed for the successful participant or the final winner. In step 556, the financial activity ends.

The steps or operations described herein are exemplary only. There may be many variations to these steps or operations without departing from the spirit of the invention. For instance, the steps may be performed in a differing order, or steps may be added, deleted or modified.

In addition to the foregoing, the present invention contemplates other types of activities. As described above, the participant may choose to contact a system administrator or other service provider to engage in financial activities. The investment is paid into the system account to purchase a share of the financial activity. It is assumed that the participant's activity was successful and that the participant may be reimbursed from the system account when certain qualifications are met. Other types of transactions are also contemplated by the present invention. For example, shares purchased during a financial activity may be uniquely assigned to the participating individuals, or they may be freely transferable. Accordingly, a financial activity may be organized such that reimbursements must be made to the investing participant, or may be made to anyone possessing sufficient identification such as an account number and password.

The present invention also contemplates in either example that investment locations, referred to herein as shares or wagers, may be traded and sold between parties, with or without interaction by personnel associated with the financial activity. The aftermarket activities in the share transfer can be provided as a service to members of the public by operators of the financial activity, if desired. In either case, the financial activity from the investment to the payback will be performed by the operator of the financial activity. In another embodiment, the present invention also contemplates that a financial activity will be conducted between two or more participants through a service that provides the financial activity operator with the facility for financial interaction between the parties involved.

Variability factor

The present invention contemplates the use of different factors that affect the price and/or payback of a financial activity. By way of introduction, in one example two considerations are considered, one relating to probability and the other relating to the calendar or timing of events. Specifically, in one example, the present invention provides price or cost variations in unit (otherwise known as "share" or "bet") purchases representing a participant's financial investment ration.

In one example, it is assumed that at some point in time before the natural event occurs, the participant can invest in the financial activity at a price set by the financial activity provider, and that the price varies depending on time and one or more probability factors. As a first component of price variability, in one example, the present invention tracks the timing of investments. It should be kept in mind that investments can be made long before natural events such as the time a hurricane will likely occur (e.g., months). One purpose of this variability factor (i.e., the time selection factor) is to encourage earlier rather than later investments. In practice, this variability factor preferably operates as a price discount factor, but the variability factor may also be applied to the redemption distribution.

According to one aspect of the invention, the one or more probability estimates are preferably made while the participant invests in the financial activity. One probability estimate preferably takes the form of a probability calculation based on current conditions, calculating the likelihood of a "hit", "successful outcome", or "qualification" of the participant's prediction to occur. For cases involving hurricane nature events, unit prices available for purchase by a participant at a given time are calculated based on the likelihood that the county (or other geographic designation of purchasing units) selected by the participant will be subjected to a hurricane attack. The probability may be based on other storms besides hurricanes, if desired, and the intensity of the storm or other factors may be employed to change the purchase price at any given time, if desired.

As yet another consideration regarding probability, financial activity in accordance with the principles of the present invention may take into account conditional probability. For example, hurricanes land in the united states an average number of times of 1.7 a year. This value is sufficient to define a poisson distribution for the number of landings in the united states according to conventional techniques, which yields a probability of 0.817 that at least one landing hurricane in the united states will occur in a certain year. Similarly, from this poisson distribution, the conditional probability that a hurricane will land in the united states at least twice, assuming that one landing has occurred, is 0.620.

In one example, assuming that K-1 attacks have occurred, the shares in the later fund may be priced cheaper than the earlier fund based on the conditional probability of the K attacks, such that at the end of the earlier fund, the price is still rising in the later fund.

According to another aspect of the invention, the financial activity comprises a plurality of stages of probability estimation, with different probability processing being given at each stage. Preferably, the three probabilistic processes are applied to investment prices, but may also be applied to redemption allocations when needed. In the first phase of the probability estimation, there are no other precursors to storms or hurricanes, and the first phase probability is preferably based on the relative frequency of the climate.

The second stage probability is effective in the event that at least one storm exists in the area of interest (e.g., the atlantic sea area), but is far away from the area of interest (preferably the U.S. native coastline and adjacent coastlines), a forecast of an impending landing cannot be made. Preferably, tropical low pressures and tropical cyclones such as hurricanes, and their off-shore locations, will be of concern at this stage for hurricane natural events. Preferably, in addition to the distance between the hot band low pressure and the area of interest, the historical course or path of travel of the storm that landed on the area of interest some years ago will also be of interest.

In the third phase, the occurrence of a natural event such as a hurricane landing is imminent. It is generally preferred that the presence of the third stage is declared based on an indication of an independent objective source of information, such as a national hurricane center. For example, a financial activity provider may notice the issuance of a hurricane warning, especially a national hurricane/tropical forecast center hurricane warning. For example, upon determining that a hurricane condition may threaten an area within 24 to 36 hours, a hurricane warning is issued. At this point, if the order is evacuated, preparation may be made for the upcoming evacuation. A hurricane warning is issued when a hurricane condition (i.e., a maximum sustained wind speed of 74mph or higher) is expected to occur in a designated coastal area within 24 hours or less. Local government agencies make independent estimates and independently issue evacuation orders to people in the affected area.

These types of event notifications may be used by the financial activity provider to end further participant activities or to trigger a transition from the second stage probability estimation to the third stage probability estimation. Depending on the nature of the forecast product, the NHC forecasts the future event 72 or 120 hours earlier. It should be noted that in this scheme, the effect of the third stage probability estimation is deliberately weakened by calendar or timing variability factors. The purchase price per unit discount is preferably very low or zero due to the imminence of natural events. If desired, a repayment penalty may be assessed for the third stage investment due to the choice of the ending time at which its natural event occurred.

Considerations relating to reimbursements

Financial activities related to hurricane natural events can be established, alone, exclusive of each other, or in combination, around a hurricane landing or hurricane overland travel route, as desired. This raises a problem, for example, when a hurricane lands on or near a boundary between two unit areas (i.e., geographic areas, such as a county for defining a purchase unit). The financial activity provider may assign any width to the landing site as needed.

Hurricanes passing through inland geographic areas can raise many different possibilities for financial activity providers to use. For example, if a national hurricane center is designated as an external objective independent source of information, one report currently available to financial activity providers is a so-called "most likely route" report issued after a hurricane event concludes. The "most probable route" report defines the inland route of the hurricane according to a discrete table of location values. Thus, the best route to define a hurricane path between the points on the "most likely route" table is determined by the financial activity provider. If desired, the points of the "most likely route" table may be connected by straight lines, or by curved lines, for example according to a predefined curve fitting method. As yet another possibility, any width may be assigned for the hurricane path.

Other sources of information may be employed, if desired, because the "most probable route" report is not the only possible source of scoring information, and may be undesirable in some instances due to the time delays associated with the publication of the report after natural activity concludes. For example, in so-called "meteorological reports" issued by national hurricane centers, without long time delays, the same kind of information (longitude/latitude and maximum continuous wind power) can be obtained in near real time. Preferably, the fastest satisfying solution of the natural event outcome may be preferred so that individuals suffering from the natural event may be quickly assigned.

Different possibilities are given when considering a specific geographical terrestrial unit. For example, reimbursement for a geographic land unit may be based on one or more external factors, such as simple hit/miss processing for the land unit of interest. In another example, reimbursement for a terrestrial unit of interest may be based on a published hurricane intensity according to a "most likely route" or other table. As yet another possibility, it may be recognized that the intensity of a hurricane may vary in density or intensity as it passes through a given geographic land unit of interest. Thus, a mathematical processing possibility is given, taking into account the difference in intensity of hurricane entry and exit points with respect to the geographical unit of interest. As yet another possibility, the geographic unit of interest may be located between points published on the "most likely route" table, and some way of value interpolation may be made with respect to the geographic unit of interest. If desired, reimbursements may be calculated based on hurricane intensity for the eligible geographic units. For example, one repayment possibility is to give more compensation to geographic units that are subjected to more intense hurricane activity, on the premise that those participants that are subjected to greater damage will be provided more assistance based on a measurement of hurricane intensity.

Other variability factors besides those described above may also be considered in calculating reimbursements to eligible participants. For example, in addition to the time and probability factors (preferred for price variability) and intensity variability described above, the residence time of a hurricane in a given geographic unit of interest may be weighted to provide more assistance to those participants suffering from greater damage based on measurements of when a hurricane is present in the given geographic unit of interest.

In one example, the invention relates to financial activities based on hurricanes and other tropical cyclonic events. In one example, the present invention includes one or more systems, one or more methods, and/or one or more articles of manufacture for conducting financial activities.

Modularity

In one example, the invention includes one or more systems, one or more methods, and/or one or more apparatuses for conducting financial activities. A number of important issues are addressed by databases and/or programs. In one example, it is generally preferable to address as many of these issues as possible on a modular basis. In this way, a system administrator can quickly and easily adjust financial activities to meet a number of specific needs, and can modify financial activities on the fly as necessary. A brief description of some of the "modularity" issues will now be provided.

1. An external objective independent agency definition that monitors natural events, measures, observes, or otherwise obtains and records data about the natural events, and draws conclusions about the natural events and makes analytical determinations. In one instance, it is generally preferred that the external objective independent institution is independent of the financial activity of the participant, and in another instance, is readily observable by the public, or at least the participant. For example, an external objective independent entity may comprise a U.S. government entity that routinely makes public claims and is susceptible to interrogation by members of the public under the information liberty act.

2. Event definitions that are eligible for redemption. For example, in connection with hurricane natural events, in one instance, it is generally preferred that the event be declared as a "hurricane" by an "authority" as defined by the national weather service. However, in other examples, other approved pre-hurricane phases may be processed by the financial activity, with or without weighting the points upon which the repayment is based. In one example, reimbursement for a financial activity may be based on the occurrence of a natural event or the termination of a natural event.

3. Allowing for the definition of participant qualifications required to engage in financial activities. For example, the skill level of the participant (e.g., required to qualify for a financial activity established as a game of skill) or the title of the participant (e.g., required to qualify for a financial activity established as a tool to compensate for the loss of title caused by a natural event) is included.

4. The "season" of the financial activity. The financial activity season may coincide with a particular time interval, such as the "hurricane season" as defined by the national weather service, for example. In another example, the financial activity season may be selected to be outside of approved or customary time periods such as the national weather service "hurricane season," and this is preferred for hurricane natural events.

5. The number and length of the financial activity seasons in a given year. In one example, there may be only one season of financial activity. In one example, the financial activity season may begin at the beginning of a calendar year. In another example, the financial activity season may begin at any time during the calendar year. In one example, the length of the financial activity season may be a predetermined number of natural events. In another example, a financial activity season may be defined to include a predetermined number of natural events, which ends after those predetermined number of natural events occur, or followed by a subsequent financial activity season. Typically, there may be one or more seasons of financial activity in a given year.

6. The type of natural event and activity upon which the redemption is based is defined. For example, for a hurricane event, approved events may include a coast strike, a land strike, and an unlanded near shore hurricane (such as a hurricane coming within a quarter mile of a qualified coast). For other types of natural events than hurricanes, other definitions of "sub-features" may be made.

7. Areas or regions eligible for inclusion in a financial activity are defined. In one example, compliance may only be declared for land areas or regions involved in a financial activity. In another example, a land area or region eligible for inclusion in a financial activity is geographically defined according to a convenient profile such as an established political boundary. In yet another example, partial geographic areas where non-compliance is included may be declared (e.g., some of the many island areas on the east coast of the united states are declared non-compliance for inclusion due to small areas, few or no living population, or other stated or unrepresentative reasons).

8. An area of natural event attack is defined. In one example, the attacked area can be defined according to an external objective independent authority such as a national hurricane center. In one example, suitable attacked areas for financial activities include those defined by national hurricane centers "most likely routes" or other temporary reports that are typically published during or shortly after the conclusion of a hurricane event. In one example, the size or width of the national hurricane center "most likely route" (preferably the eye center of a hurricane) may be infinitely fine, or it may be a predetermined width. In one example, the struck area suitable for financial activity may be calculated by connecting a straight line or a curve preferably defined by a predetermined curve fitting method at a point given in the "most likely route" national hurricane centre table data for a hurricane.

9. The nature of the natural events that fit into the financial activity are defined. For example, an event formally determined by a national hurricane center as an explicit "hurricane" may declare a unique eligible natural event recognized for a financial activity according to the operating rules. In another example, a financial activity may handle a "hurricane" defined by a national hurricane center according to its storm intensity defined by the national hurricane center. For example, only hurricanes that reach a third type of severity defined by the national hurricane center may be declared as appropriate for financial activities. In one example, the repayment may be based on a hurricane attack, weighted according to its storm intensity as defined by the national hurricane center. For example, different eligible participants may be reimbursed different amounts based on the assignment of hurricane "most likely routes" depending on hurricane contact time and/or hurricane severity at the contact points or other primary, secondary, tertiary or other criteria. In one example, information about tropical weather event overland travel routes observed from independent external sources may not be continuously reported. For example, using a "most likely route" or other table inherently assumes that discrete points of data are scattered over a time interval. Problems arise when the reported data does not correspond to the financial activity defined geographic region boundaries. Various treatments can be given. For example, an average may be determined between two adjacent data points (e.g., two adjacent points of a "most likely route" or other table), and this average may be used to determine a value of a natural event as it passes through a given geographic area. In another process, if a data point (e.g., a "most likely route" or point on other tables) occurs within a financial activity geographic area, the value of the data point may be assigned for all investment usages made within the participant's predicted geographic area. Other processes are also possible.

10. The redemption amount is determined for those participants eligible to receive a redemption. Several examples of refunds that vary based on a number of different factors and considerations are presented herein. These variations can be accounted for in a number of different ways, including, for example, simple linear weighting or more complex algorithms. In another example, the change in payback between different participants may be based on one or more related or independent factors, as may be desired. In one example, determining a redemption amount for a qualified participant may be based on primary, secondary, and (if desired) tertiary criteria and other criteria. For example, for a tropical weather event, one criterion may be selected as the landing "location" for the tropical weather event. If desired, the overland travel route for a tropical weather event may serve as another primary criterion (especially assuming equal weighting between primary criteria) or may serve as a secondary criterion (especially if the assignment is unequal and preferably less weighted relative to the primary criterion). In another example, it may be preferable that other secondary or lower level criteria be selected when a tropical weather event resides in a geographic area predicted by the participant, such as residence time in a given geographic area or wind speed range associated with the tropical weather event. As yet another possibility, multiple criteria may be determined at three or other additional levels (preferably assuming unequal weighting between the criteria levels).

Other examples of variability factors are discussed herein and will be summarized below.

Derived transaction financial activity model

As described above, a financial activity in accordance with the principles of the present invention may be modeled in one example as a financial transaction that mimics a derivative underwriting interest (e.g., option), such as those monitored by the Committee of futures trading (an independent agency of the U.S. government). Generally speaking, activities under the "derived transaction type" financial model incorporate price control that is more driven by market conditions and less directly controlled by rules, operating principles, and other structures via ongoing financial activities, as compared to other types of financial activities contemplated herein.

According to one example of this financial activity model, and assuming a natural event of the hurricane or tropical weather type, all geographic areas (e.g., counties) that are initially in effect may be started for each investment starting from the declared financial activity season at some predetermined minimum investment amount (i.e., purchase price). Once an investment has been made in a particular geographic area, the next investment made in the same geographic area is set to a higher purchase price. For example, the rules of the financial activity may dictate that a second investment will be subject to a flat rate pricing increase, such as $ 0.25 per share. If desired, the bid increase may be assigned in several steps, depending on the step increase in the transaction amount (amount of money or share of the transaction). Other types of increases may be employed, if desired, including linear and non-linear mathematical manipulations of the purchase price. The price of the subsequent investment in a particular geographic area may continue to increase or will stabilize at a constant price until a set point for the lowest quantity of shares or the lowest amount value is reached.

Preferably, the set point is selected to reflect a basic "pot size" which will prove to be a basic step in price increase. Several steps of price increase may be taken, if desired, and associated with share blocks of similar or different sizes. For example, if a particular geographic area is momentarily silent in a transaction, the purchase price may be lowered based on the time value since the last transaction activity. Once the activity for a particular geographic area is restored, a price increase may be applied. Each geographic area will have a different initial price and, if desired, may have different step sizes or blocks when trading shares are made. Thus, in this example, the share price varies as a function of market activity (e.g., increases in a gradual or smooth change as trading activity increases). In this example, the share price can optionally also vary based on a time factor, such as a factor centered on a decline (or optionally an increase) in transaction activity.

It is generally preferred that pricing follow a number of principles. For example, it is generally preferred that the transaction begin at a set minimum price, which may be different for each geographic region. In one example, it is generally preferred that the minimum price be dependent on market activity. In a second example, it depends on the climate probability (currently estimated) of the particular geographic area hit, and on how many shares have been sold in the particular geographic area and the total amount in the pot as the transaction progresses. Each of these principles may be applied in different amounts (e.g., based on different increments, different rates, or other mathematical processes), as desired. It is generally preferred that the minimum price increases as the probability of hit increases in the geographic area, and that the minimum price should also increase as the total amount in the pot increases. In one example, it is generally preferred that the minimum price decreases as the number of shares that may be partitioning the pot (i.e., for a particular geographic area) increases.

As an alternative, financial activities of the "derivative transaction" type may operate according to different structures. In this second example, financial activity in a mature market may be alternated (less preferably, replaced) with a "auction" form of financial activity. In one example, auction-style financial activities are scheduled to occur at different intervals once initiated. For example, in one example, multiple auctions will preferably occur periodically throughout the season, with the time intervals between auctions being sparse early in the process (e.g., weekly or monthly), and more frequent when tropical cyclones exist, and particularly when hurricanes are imminent (e.g., multiple auctions per day).

In one example, the reserve price for the auction is preferably proportional to the probability that a particular geographic area will hit multiplied by the available funds and the product divided by the number of outstanding shares for that particular geographic area. The proportionality constants applied may be uniform, or some number less than or greater than 1, as desired.

In another variation, researchers make trading contracts corresponding to different geographic portions, with contract prices set by participants, rising and falling based on the confidence that a landing will occur. These contract amounts will rise and fall based on market acceptance of the predicted storm occurrence.

Preferred features

As noted above, a number of different alternatives and variations are possible in conducting financial activities in accordance with the principles of the invention. Representative alternatives and variations, which are preferred but not necessarily required in conducting financial activities in accordance with the principles of the invention, are discussed below. Although the following exemplary preferred features are generally compatible with each other, it is possible that any number of these features may be inconsistent with or mutually exclusive of the other features. These exemplary features include:

1. a variability factor affecting at least one of said investment price and said allocation/redemption. It is generally preferred that the variability factors include at least time interval considerations between the investment and the occurrence of the event and a defined predicted outcome probability that is preferably set at the time of the investment. Other variability factors may also be included.

2. The price to which the participant is given his choice of investment is preferably constantly changing, for example, depending on the variability factor that is in effect at a given time. In general, it is preferable not to eliminate price variations for the purpose of shortening processing delays or other reasons.

3. The price of any predicted outcome at any given time is preferably the same for all participants.

4. Reimbursement for successfully qualified participants is preferably made according to the same set of rules that apply to all participants. It is generally preferred that no rewards be issued to the preferred participants.

5. All winners (eligible participants) share the fund total. It is generally preferred that there is no possibility of multiplying investments of investors. Furthermore, it is generally preferred that the refunds are not paid out from the provider's personal account-as opposed to "house" for certain wagering activities where winners are refunded from their own account.

6. The provider does not act as a participant. For example, it is generally preferred that no buy-through transaction exists where, for example, there may be too many bids.

7. Participants do not compete with the "business" or provider.

8. It is generally preferred that the financial activity does not change in response to the investment activity amount.

9. A financial activity contains a single event or event type for a given "season".

10. It is generally preferred that participants be able to objectively and independently observe events themselves while carrying out activities.

11. It is generally preferred that, in addition to financial responsibility, the investment of the participant is "accepted" only in terms of data format. Alternatively, the acceptance may be related to an optional investment amount. It is generally preferred that there are no additional constraints for each investment event.

12. It is generally preferred that financial activities be performed in as real-time as possible, and this is made possible by rule definitions, particularly event and event result definitions that occur in a well-defined environment/system. It is generally preferred that event selection for financial activities be limited to an absolute minimum value-i.e., a single event.

13. It is generally preferred that financial activity be limited to tropical weather events, and in one example, only to hurricane events.

14. It is generally preferred that the financial activity is also limited to include at least one of the landing and the route of travel on land. In some instances, it may also be preferable to limit financial activity to hurricanes that have a certain type of intensity at a certain defined time during an ongoing financial activity.

15. In some instances, it is preferred that multiple stages of probability estimation be applied to at least one of said investment and said payback.

16. In some instances, it is preferable that the external objective independent information sources be limited to the National Hurricane Center (NHC), and optionally to its subordinates and/or associated agencies (e.g., TPC).

17. In some instances, it may be preferable to limit financial activity to only the united states and its territories and territories.

Other preferences

In addition to the preferred features described above, it is generally preferred that the graphical user interface be used to deliver educational information to participants on a continuing developmental basis. For example, it is often preferable to provide participants with a large number of information sources to stimulate further interest in financial activities and skills that enhance it. For example, it is generally preferred that live feeds of various external objective independent information sources be continuously delivered to the participants. For example, the storm location and varying intensity and its projected path may be displayed on a flat map. This type of data may be obtained, for example, from national hurricane centers. Other competitive predictions from other independent sources may also be displayed, preferably in different colors on the same map. As storms progress and location changes, it is preferable to continually display updated current pricing calculations, with any necessary qualifying assumptions available to the participants.

Furthermore, it is generally preferred that the current amount of investment in a particular geographic area be displayed along with historical likelihoods or probabilities for that geographic area, so that it is possible for participants and interested observers to determine reimbursements that will be under the specified conditions as the storm progresses as predetermined. For example, a profit for a given geographic area may reflect different investment times, different total amounts invested throughout a financial activity, different severity or other characteristics of a storm, and a probability that the storm will hit the area of interest based on historical data and/or recent predictions. It is also generally preferred that the participants and interested forecasters have access to a data window showing the total fund invested currently and a map of the geographic area with the amount of investment made for that local area.

In general, it is preferred that the financial activity have educational components to enhance the knowledge and skills of the participants to help improve their financial condition. This level of knowledge and skill will also help the participant to handle the reality of being subjected to potentially harmful storm activity. It is also generally preferred that the financial activity display to the participants help information, such as item checklists, needed to prepare for the upcoming threat event. These checklists may help organize participant activities, reducing available preparation time. If desired, the participants may be asked to review inventory information and publish it in a common viewing area. In another example, a display area may also be provided that displays continuously updated impairment estimates, life threats, and similar public safety related information.

While exemplary implementations of the invention have been illustrated and described in detail herein, it will be appreciated by those skilled in the relevant art that various modifications, additions, substitutions and the like can be made without departing from the spirit of the invention and these are therefore considered to be within the scope of the invention as defined in the following claims. For example, various communication functions may be combined into one or more communication units to perform one or more communication tasks.

Claims (22)

1. A method of conducting a financial activity between a provider and a plurality of participants based on a natural event, comprising:

a method of obtaining the participant prediction data of the natural event prediction result;

a method of setting an investment price for each participant;

a method of obtaining said participant investment fund paid at said investment price;

a method of recording the time of investment by said participant;

a method of concentrating said participants investment funds in a common pool;

a method of obtaining information about the natural event from an external independent information source;

a method of comparing the participant's prediction data with the external information to determine whether there is a match result; and

a method of allocating funds from the pool to participants having matching results.

2. The method of claim 1, wherein setting an investment price for each participant increases the investment price over time.

3. The method of claim 2, wherein setting an investment price for each participant further comprises using a variability factor related to a probability of a matching outcome of the participant's predicted outcome at the approximate time the participant invested.

4. The method of claim 1, wherein assigning funds to participants having matching results further comprises determining an equal share assignment for each participant.

5. The method of claim 1, wherein allocating funds from the pool to participants having matching results comprises applying the same set of rules to all participants to determine their allocation funds.

6. The method of claim 1, further comprising obtaining historical data of past natural events related to the natural event type from the external independent information source.

7. The method of claim 1, wherein the provider is not available to engage in the financial activity as a participant.

8. The method of claim 1, further comprising determining a qualification of the participant to engage in the financial activity.

9. The method of claim 8, wherein determining the eligibility of the participant to engage in the financial activity comprises: determining skills of the participant that are relevant to understanding a natural event of the natural event type.

10. The method of claim 8, wherein determining the eligibility of the participant to engage in the financial activity comprises: an area of the natural event is defined and information about the property rights of the participants in the area of the natural event is obtained.

11. The method of claim 8, further comprising determining the participant's eligibility to engage in the financial activity by obtaining an answer from the participant in response to a question related to a natural event of the natural event type.

12. The method of claim 8, wherein determining the participant's eligibility to engage in the financial activity comprises obtaining financial data about the participant.

13. The method of claim 1, further comprising obtaining an identity of the participant.

14. The method of claim 8, further comprising obtaining historical data about the natural event of the natural event type from the external independent information source.

15. The method of claim 1, further comprising obtaining prediction data for a natural event of the natural event type from the external independent information source.

16. A method of conducting a financial activity between a provider and a plurality of participants based on a natural event, comprising:

a method of each participant providing to the provider predictive data relating to the natural event outcome;

a method of each participant receiving an investment price from the provider;

a method of providing each participant an investment fund paid at the investment price;

a method of each participant receiving information about the natural event;

a method of a participant having a match of the predicted data of the participant with natural event data from an external independent information source regarding the natural event obtaining an indication of the match from the provider; and

a method of a participant having a matching result receiving funds from a common pool in which said participant invests funds.

17. The method of claim 16, further comprising receiving a value from the provider based on the match result, wherein the funds the participant receives are assigned according to the value.

18. The method of claim 16, further comprising applying at least one variability factor to one of the investment price and the amount of funds received by participants with matching results from the common pool.

19. The method of claim 18, wherein the at least one variability factor comprises at least one of the time interval between an investment by a participant and the occurrence of the natural event and a probability of a match of the predicted outcome of the participant at the time of the investment.

20. A system for conducting financial activities based on natural events, comprising:

a financial activity module for facilitating financial activity between a provider and a plurality of participants, receiving external natural event information from an external independent information source, and providing financial activity information to the participants;

at least one communication module for communicating between the financial activity module and an external independent information source to receive the external natural event information from the external independent information source;

the at least one communication module further providing communication between the financial activity module and the participants to transmit the forecast data from the participants regarding the natural events and to send investment prices to each participant;

a comparison module for comparing the predicted data of the participant with the external natural event information and providing an indication of a match result to the participant; and

an allocation module for allocating funds to participants having matching results from a common pool of funds collected from the participants paid at the investment price.

21. The system of claim 20, wherein the communication module further comprises an arrangement for communicating to the participant an indication of when the provider received one of the participant's forecast data and the participant's investment price payment.

22. An article of manufacture comprising machine-readable media for causing a computer to provide financial activity between a provider and a participant based on a natural event, the modules comprising:

a financial activity module for performing financial activities between a provider and a plurality of participants, receiving natural event information from an external independent information source, and providing financial activity information to the participants;

at least one communication module for performing communication activities communicated between the financial activity module and an external independent information source to receive natural event information from the external independent information source;

the at least one communication module communicates between the financial activity module and the participants to receive forecast data from the participants regarding the natural events and to send investment prices to each participant;

a comparison module for comparing the predicted data of the participant with an indication of the occurrence of the natural event; and

the at least one communication module further communicates between the financial activity module and the participant to provide an indication of a match result to the participant based on the match result of the comparing step and to indicate to the participant having a match result from the comparing step that a portion of the fund is to be paid from the common pool collected from the participant.