JRC joint project.
JRC Capital Management
Consultancy & Research GmbH
Consultancy & Research GmbH
RESEARCH
JRC joint project CoraPatents: research on patent valuation
As a technology-oriented and innovative financial services provider, JRC Capital relies on continuous scientific research
Patents play an important role in the valuation of companies – especially for innovative SMEs that already hold their own patents. However, evaluating patent values is complex and difficult for investors and lenders. The joint project “CoraPatents” by the JRC and the companies InTraCoM, Inovamais and Privé Services presents a solution to this problem: New patent value indicators are being developed and linked to other quantitative indicators of fundamental company analysis. On this basis, a prototypical software platform is implemented, with the help of which current patent values can be determined and future patent values can be estimated. It will also make it possible to create and test completely new generations of financial products.
Currency models for patent valuation
Patent valuations are particularly complex if the basic valuation of the company under investigation is in a foreign currency or the patents come from non-EU countries. The task of the JRC within the joint project is to develop suitable currency models and to integrate them into the planned platform. These allow foreign currency risks to be assessed and the effects of exchange rate fluctuations to be forecast. It is possible to determine current and historical patent values in euros and to assess future expected developments in value. The work of the JRC consists of three successive work packages:
1. Selection and validation of currency models
Suitable currency models and risk management models are selected and adapted on the basis of the JRC’s well-founded model library. In addition, suitable interfaces are specified and implemented in order to integrate the currency models with patent value indicators and the technical chart models. The models are then ported to the software platform and extensively tested.
2. Simulations for determining trends and hedging risks
Comprehensive simulations are carried out in the second work package: The currency models are systematically combined with various indicators based on historical data. The models can be used to determine trends and to hedge risks:
Trend determination
- Determination of the current patent value
- Presentation of the course of the performance in the past
- Forecast of the future expected performance of the patents
Risk coverage
- In case of negative performance: proposal of counter positions to neutralize currency fluctuations
- In the event of positive performance: closing out the hedged items
3. Expert assessment by the JRC
On the basis of the minimum requirements for risk management (MaRisk) and the banking supervisory requirements for IT (BAIT), the JRC ultimately evaluates the platform and all financial products from the regulatory point of view.
Patent Valuation: New Opportunities for Asset Managers
The new currency models create algorithmically generated indicators and exciting trading signals for the JRC as well as for asset managers and other interested target groups. The models can primarily be used to develop new financial products such as funds or promissory note loans. They can also be used in risk management and asset management. The project results of CoraPatents serve the JRC not least as a cornerstone for promising follow-up projects.
Further information about the projects of the JRC Capital Management Consultancy & Research GmbH is available here .
This project is funded by Eurostars and has grant number 01QE1738A
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