From Ideas to Assets chapter 14 “Using Patent Indicators to Predict Stock Portfolio Performance” Summarized by Kibeum Ryoo

Introduction Intellectual properties are important factor in a company’s commercial success High quality patent portfolio indicates a company’s technology strength Technology Market Model identifies market and technology values of a company based upon its patent portfolio

Identifying quality patents Highly cited patent has higher importance (patent citation analysis) The more cited patent are expected to have higher commercial returns Patent background search provides rationale for expectation of a company

Key indicators to high potential 1.Number of patents 2.Patent growth 3.Current Impact Index 4.Science linkage 5.Technology cycle time By examining the above indicators, company’s potential can be measure

Technology Quality Model Identify companies with the strongest patent portfolio in their industry By using score system that relates company’s patent indicators with stock price, TQM examines company’s future stock price By normalizing numbers of companies in a certain industry by the highest value company, numbers of companies can be compared with relative to each other

Technology Market Model Companies are valued based on the quality of their technology and commitment to R&D Companies are re-examined for their stock values to check for under- and overvalue.

Conclusion Using combinations of patent indicators, a company's stock value can be linked with its value of patent portfolio Companies with high technology potential on average performs better in the market By using Technology Market Model, re- examining companies' stock value is made to ensure their future price Technology Quality Model evaluates companies potential for success