Conduct Maximum Trades at Market-Clearing Prices
The Coordinated Discovery Market (CDM), through our patent-pending approach, establishes a better exchange market for commodities. Conduct all trades at market-clearing prices with radically improved price discovery, lower total cost of transactions, and effectively suspending the need to hedge.
Competition is confined within participant groups, so speculators compete to provide better forecasts, producers compete to produce more plentiful (and cheaper) goods, consumers compete to use more plentiful (and more expensive) goods.
This enhanced exchange market maintains its foundation through transparency and maintaining trustworthiness through computer-run algorithms.
Participants Within the CDM Exchange
Coordinated Discovery Markets (CDM):
A New Method for Operating a Commodities Exchange
- CDM publishes current and future prices of commodities to producers, consumers, and speculators
- CDM receives offers to sell a commodity at the current prices from the producers
- CDM receives offers to buy the commodity at the current prices from the consumers
- CDM matches the offers to sell the commodity with the offers to buy the commodity
- CDM computes the delivery contracts and sends directly to the producers and consumers, based on the matching
- CDM receives confirmation of delivery of the commodity from the producers to the consumers
- CDM releases escrowed funds of the consumers to the producers
How It Works
By linking a positive sum forecasting market to a negative sum clearing house in a mutually negative reinforcement control loop, the socially and economically useful features of an exchange market can be produced with spread (cost) and return being independently settable attributes of the marketplace.
CDM provides these features by organizing a sequence of clearing prices and accepting future price speculation from speculators along with an investment, establishing a Pricing Calendar. The investments are combined into a better pool, and the speculators who most correctly predicted the future prices are rewarded out of the betting pool utilizing a parimutuel payout.
The CDM marketplace publishes its Pricing Calendar and uses it to attract customers. Having a known schedule for deliveries to occur with prices only useful for those scheduled windows of time, price is stable during those times so all parties get the same price. The forecasting market works by adjusting the individual prices at each date to where forecasters think they will wind up. Consequently, the forecasters make money by causing the market to be as accurate and stable as possible.
CDM allocates return on investments based on information measurement and allocates trade to minimize global marginal and logistic costs. It handles transactions between producers and consumers who also are able to utilize the pricing information provided by speculators when determining how much of a commodity to buy or sell.
This process arrangement and the algorithms that support it allow the separation of speculation from trading so that speculator incentives can be inverted to align with producers and consumers. As such, a new logical construct for an exchange market results, with a different (and improved) set of rules for interaction of the relevant participants.
Partner With Coordisc
Learn more about the Coordinated Discovery Market (CDM), radically improved price discovery, and maximizing commodities trade volume at market-clearing prices.