Markit, a leading, global financial information services company, today launched a new factor model that evaluates the quality of patent portfolios held by publicly-traded companies.
Called the Markit Intellectual Property (IP) Model, the service analyses more than 4.5 million US patents held by more than 1,200 public companies, and enables traders, analysts and portfolio managers to compare patent portfolios objectively.
Investors have become more focused on intellectual property (IP), particularly in the technology sector, and the value of patents was central in recent deals involving Nortel, Motorola and AOL. The Markit IP Model provides a systematic assessment of patent holdings, and contains nine factors related to the ownership and development of intellectual property. The factor suite includes metrics that score patent grants, technological quality, scientific relevance, and how quickly a company's patent portfolio is growing, both in size and relevance.
Tim Sargent, Managing Director and Head of Markit Data Analytics & Research, said: "IP has a low correlation to more traditional financial indicators, and our ability to score patent portfolios presents a new range of exciting analytic and trading opportunities. With one click, users can now measure IP strength and access new metrics for valuing firms with IP assets based on a systematic quantification of indicators such as trends in patent citations and how efficient a firm is in producing new patents."
The Markit IP Model joins a suite of 300+ equity factors developed by Markit Data Analytics and Research, the business unit formed by Markit after it acquired Quantitative Services Group LLC in November 2011. Markit's factor analytics platform is a fully-integrated research and signal management platform which allows seamless custom model building and strategy deployment for equity and fixed income.
A partnership with The Patent Board provides research information that powers the Markit IP Model.