STUDIES, PUBLICATIONS & WHITE PAPERS

The effectiveness of a patent key-figure based portfolio selection is demonstrated through the results of 13 indices where an additional patent based factor filter was applied and backtested. In all cases, significant outperformance in comparison to the original index composition was observed.

The world is obsessed with innovation. “Development” and “progress” have become watchwords, and we all expect things to continue to get more convenient, to be able to have what we want delivered to our doorstep more quickly, and to get wherever we need to go, faster. We describe it as wonderful, and various innovations have fundamentally changed and improved lives around the globe. But this drive towards progress—this drive to increase economic growth and life span—sometimes causes us to stop paying attention to aspects of new innovations that affect the quality of life.

This study shows that the existence of a valuable patent portfolio has a correlation to the survival rate of a company. It has been demonstrated that companies with the lowest threshold of 8 mUSD of patent portfolio value show already a significant risk decrease. This is especially important for small companies, which have in average a higher default rate compared to large companies . This result can be used to e.g. create a product with high-yield bonds and reduced risk by monitoring the corporates' patent portfolio values.

Innovations & patents are key factors for the success of companies. But how can these topics be analyzed efficiently, especially with a view to the stock market valuation of stock companies? And how can we measure the influence of patents on share price development? Answers from Dr. Dierk-Oliver Kiehne, Managing Director of InTraCoM GmbH, in an interview with stock exchange moderator Andreas Franik - recorded on the floor of the Frankfurt Stock Exchange.

Using the Patent Value provided by IPR Strategies, MSCI research performed decile analysis of all the stocks the MSCI World universe.

Funds compositions are typically the result of more-or-less intense fundamental or quantitative analysis. Here, often indicators like the company size, dividend payments, profit margins and their change over time are considered. If R&D activities are also considered then most often the R&D expenses are used as an innovation indication. For the measurement of a sustainability degree of a certain company, external ESG data are used or own research is analysing the sustainability reports that are based on the corporation’s selfassessment. New key figures based on patents, their value and their quality are able to uncover even more: R&D outcome - the innovation “ability”, hidden assets – patents are often not activated in the balance sheet and even sustainability activities can be easily extracted out of patents. How effective a selection based on patent key-figures is, shows the result of 13 Indices where an additional patent-based factor - filter was applied and backtested. In all cases significant outperformance could be shown in comparison to the original Index-composition.

The most important part of a patent representing the legal core of the invention are the claims: they reflect what the owner claims to be his monopole with his invention for the lifetime of the patent. Some statistical and textual approaches investigate in this analysis what makes a claim valuable in terms of a big claims coverage. The direct quality indication is derived from secondary indicators like foreign forward citations and oppositions being a value-driving blocking effect indicator. The analysis shows that there is a significant scheme that leads to a higher citation frequency as well as a higher opposition frequency and thereby a higher quality.

Bloomberg published their most recent ranking where the worldwide most innovative countries are listed. “South Korea returned to first place in the latest Bloomberg Innovation Index, while the U.S. dropped out of a top 10 that features a cluster of European countries”. According to their fast and dominating development in trend technologies like e.g. 5G this sounds credible. However, such a picture should also be reflected in the patenting activities, especially in those activities addressing sustainable technologies.

This paper goal is to present the results the use of patent valuation indicators as alternative data which can determine sustainable patents inside a patent portfolio and generate a ratio of sustainable technologies which are developed by a company. Based on different qualitative patent indicators which address the areas “technology” and “market” the enhancement of an ESG rating was prepared and discussed. The paper was presented at 2020 Etria world conference TRIZ (TFC2020), Oct. 14th-18th, 2020

This paper goal is to present the results of the use of patent valuation indicators as alternative data which can generate a value factor which is suitable to design financial products. Based on different patent value indicators which address the areas “assignee”, “technology” and “market” an “IP portfolio index” was designed and backtested with real market data. The outperformance of the IP portfolio index is shown in the current paper. The paper was presented at 2020 International conference on Modern Management based on Big Data (MMBD2020), Oct. 18th-21st, 2020

Sustainability has become the driving factor in analyzing and evaluating companies. Sustainability is now the most important factor for all stakeholders, be it: customers, employees, business partners and investors. The assessment from companies is mainly based on self-reporting and objective measures exist only in part thus greenwashing is to a large extent possible. The study shows, how patents can be used to identify active sustainability in companies, show the most sustainable sectors and companies in it. It compares the "most sustainable companies" rated by other organisations with the "patent ESG score" with surprising results.

According to the uncertainty about patent quality it may make sense to simply have a look at the quantities of patents that are filed. Indeed, when analysing all patents worldwide, the correlation between patent filings and and patent portfolio values shows a significant correlation. This phenomenon is known as the law of large numbers a statistical trap. But when doing a segmentation, e.g. by comparing groups of industrial sectors, countries or company sizes, the correlation becomes more and insignificant. The study shows a lot of unexpected surprises in terms of value averages and patent filings when different segmentations were used.

ESG stands for “Environmental, Social and Governance”. These three central factors are used in order to measure the sustainability and ethical impact of an investment in a company. In this study it is shown how patents can be used in order to determine at least the environmental aspect of "ESG". The used method can be used to assign each company an ESG related score. Within this study it should also be investigated, if the ESG rules for investment also drive companies to invent more in the enviromental related fields.

This analysis was performed for equities in the S&P500, STOXX600 and Nikkei300 index. The main aim of the analysis is to determine the share of the intangible assets related to the comapny value and related to other financials indicators from the balance sheet.

The benchmark analysis was done on the DJ STOXX600 Index in order to determine if there is a correlation between the espenses for research and development and the patent value for companies.

In an interview with Hedgework News, Prof. Andreas Zagos explains how this factor can be used as a kind of leading indicator for stock selection.

The basic idea of this study is to identify the most interesting companies in the fintech industry by valuating their intellectual property portfolio, namely patents and utility models. This will be achieved by compiling a comprehensive list of fintech companies, evaluation of their patents and utility models and comparison and benchmarking it in its respective sector.