| US20070271163A1 | 2007-11-22 | |||
| US20040260578A1 | 2004-12-23 |
LAUSBERG, C. ET AL.: "Risk measures for direct real estate investments with non-normal or unknown return distributions", Z IMMOBILIENOKONOMIE, vol. 6, 26 August 2019 (2019-08-26), pages 3 - 27, XP055853719
| CLAIM. I am seeking patent protection for the internet devised application of already existing data from sources such as Yahoo. Finance (for FOREX and equity and fixed income assets) and CoreLogic (for realestate), and already practiced VaR calculations, to be applied to calculate and transact "VaR insurance" to investors via internet platforms such as but not limited to CommSec or CoreLogic using Al as the means for such quote and sell policy possibilities for financial assets mentioned within this patent application. Over the past 30 years Australia has avoided recession, and although at the time of writing this application the ASX is at all time highs, the market still has shares that obviously gain in value, but amongst this growing trend there are still those shares that lose value over a given time span. The purpose of this patent application is to exploit a well known methodology known as "Value at Risk". Anyone who has completed a commerce or accounting and finance degree will be familiar with this term. It calculates the possible losses from an investment, namely FOREX, EQUITY, FIXED INCOME over a given time frame, generally 1 day, 7 days, 10 days, but for this application I wish to extend this VaR methodology to REAL ESTATE and extend the time frame to 26 months (not 26 days) . VaR is not a new concept but "VaR Insurance" is judging from my research into possible loss insurance for the above mentioned asset classes a new nonobvious business method worthy of patenting. VaR was originally deployed by JP Morgan in the 1980's for their chairman to know what their exposure was on any given close of trade day. (LANGE, 2015, "Financial Institutions Management", P311) Contracts for any of the mentioned asset class, could be offered 1:1 between insurer and insured, or offered by third party, for example CommSec or CoreLogic could incorporate a button on their share business platform that calculates and enables participation of the investor to the insurer, whereby the insurer would pay the third party a fee for attracting the new business transaction. And hence incorporating technology to bring together B2B and B2C transactions via software. Investopedia states that "The element of risk is inherent to investing, which is why investments are not (and cannot be) insured". (Investopedia, 2020). Just as 20 years ago, bad debts insurance and trade inventory loans gearing was not offered, I believe that what I am proposing is a future revenue stream for the insurance industry, which based upon the above "shallow" Investopedia conclusion makes this patent application as mentioned earlier, Nonobvious. (Investopedia, 2020, viewed 20/2/2020, <https://www.investopedia.com/ask/answers/are-my- investments-insured/>.) 4 Substitute Sheet (Rule 26) RO/AU |
| AMENDED CLAIMS received by the International Bureau on 09 June 2021 (09.06.2021) CLAIM. I am seeking patent protection for the internet devised application of already existing data from sources such as Yahoo. Finance (for FOREX and equity and fixed income assets) and CoreLogic (for real estate), and already practiced VaR calculations, to be applied to calculate and transact "VaR insurance" to investors via internet platforms such as but not limited to CommSec or CoreLogic using Al as the means for such quote and sell policy possibilities for financial assets* mentioned within this patent application. [CLAIM 1-6] Shall formally be recognised as per listing in ISO document provided on 30/4/2021. Flowever they are not critical to this patents inventive features so are not listed on this CLAIM document. Therefore, [CLAIM 7], financial assets proposed to be incorporated via this patent application are to be as addresses in opening CLAIM paragraph*; EQUITIES, FIXED INCOME, FOREX & REAL ESTATE, (not just REAL ESTATE as is incorrectly realised by the Authorised Officer so far from ISO document CLAIM 1 comprehension). Also, The real cause driver for this patent application, is as follows; [CLAIM 8] Applying VaR calculations to a business margin (percentage of VaR) to arrive at an insurance sum that may be used for my proposed business to provide retail and institutional investors an insurance policy to insure possible losses their investments might incur throughout a specific time frame. Finally, [CLAIM 9] shall be overriding [Claim 6], that being for this patent application, I wish to commit to VaR calculations of anywhere from 1 day upto 26 months, noting that textbooks refer to VaR calculations being normally valid for 1,7,10 day periods, as a general Liquidy holding rule for the finance (stockbroking) industry. And thus any timeframe beyond 10 days, is deemed to be new and nonobvious to those skilled in the art of VaR calculations and applications. Over the past 30 years Australia has avoided recession, and although at the time of writing this application the ASX is at all time highs, the market still has shares that obviously gain in value, but amongst this growing trend there are still those shares that lose value over a given time span. The purpose of this patent application is to exploit a well known methodology known as "Value at Risk". Anyone who has completed a commerce or accounting and finance degree will be familiar with this term. It calculates the possible losses from an investment, namely FOREX, EQUITY, FIXED INCOME over a given time frame, generally 1 day, 7 days, 10 days, but for this application I wish to extend this VaR methodology to REAL ESTATE and extend the time frame to 26 months (not 26 days) . VaR is not a new concept but "VaR Insurance" is judging from my research into possible loss insurance for the above mentioned asset classes a new nonobvious business method worthy of patenting. Contracts for any of the mentioned asset class, could be offered 1:1 between insurer and insured, or offered by third party, for example CommSec or CoreLogic could incorporate a button on their share business platform that calculates and enables participation of the investor to the insurer, whereby the insurer would pay the third party a fee for attracting the new business transaction. And hence incorporating technology to bring together B2B and B2C transactions via software. Investopedia states that "The element of risk is inherent to investing, which is why investments are not (and cannot be) insured". (Investopedia, 2020). Just as 20 years ago, bad debts insurance and trade inventory loans gearing was not offered, I believe that what I am proposing is a future revenue stream for the insurance industry, which based upon the above "shallow" Investopedia conclusion makes this patent application as mentioned earlier, Nonobvious. (Investopedia, 2020, viewed 20/2/2020, <https://www.investopedia.com/ask/answers/are-my-investments- insured/>.) |
(Where VaR is Value at Risk, not Video assisted Referee for football).
DESCRIPTION.
It is my observation that VaR with confidence of 99%, generally shows a possible loss of between 5 - 10 % of the investment sum over a 10 day period. As mentioned in the CLAIM DOCUMENT, I would like to patent the business methodology of not sticking to the practiced, 1,7, and 10 day VaR calculations but to extend the loss time frame upto 26 months. Following I will give an example of each Asset class VaR Insurance policy I propose to offer anybody who wishes to take out cover via an underwriter via this proposed patent.
REAL ESTATE: Say a body owns property worth 1 million dollars, and expects to sell that property within the next 26 months (could be between 1 day to 26 months). They are not sure of the future property market and research shows that the property value could decline by 10% over the next 26 months. I would calculate the VaR as is already practiced by many within the finance industry. VaR for REAL ESTATE would be based upon a formal market appraisal or actual purchase price. But now unlike finance institutions that hold the possible loss sum as cash to ensure liquidity, the underwriter would charge a fee to the property owner for the possible loss of $100000.00 as an upfront policy against any loss the property value incurs for the life of the policy (in this case 26 months). It is similar to hedging, but simpler, if the property gains in value, the policy lapses and no other transactions occur, but say the property declines in value by $70000, the property owner would receive the $70000 at the end date of 26 months upon forwarding the insurer the sale contract displaying the formal market appraisal or purchase price 26 months prior, and the loss making sale price.
FIXED INCOME OR EQUITY ASSETS: Similar to the above, an investor would produce to the insurer the buy price contract of the Bond or Share/Stock/Security. The insurer would offer the investor a loss cover contract say again, for 13 months, and before that 13 months expires, if the investors investment has decreased in value and sells their asset, the insurer would recoup the investor for the difference between the buy price and loss making sell price, upon receipt of the sell contract. Again like the above, it would be calculated by normal VaR method for Equity or Fixed income which differs from Forex, but then the insurer charges a fee for this possible loss cover. Unlike Put or Call Options that are practiced today within this asset type market, where the investor only puts forward a minimum amount of the total buy or sell price and then premium for expected gains (and loss possibility premium), VaR Insurance, would be simpler to calculate and rely on the buyer of the asset making the full purchase on the Buy transaction, or at the same time as the Buy transaction was being instigated by the buyer / investor on any of the major commercial trading digital platforms.
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Substitute Sheet (Rule 26) RO/AU FOREX: Forex markets have a range of financial products, like options, swap, forwards, that aim to mitigate FOREX losses over a given time frame. But these contracts can be complex and confusing. I deem via the same VaR Insurance methodology as per REAL ESTATE or FIXED INCOME or EQUITY, a simple Insurance policy could replace many of these practiced devices. Again, the Insurer would calculate the VaR, and then charge a fee for offering the investor an absolute loss prevention sum to the original spot rate at the beginning of the contract between the insurer and insured.
From an accounting perspective, the paid premium would be instantly deductible, whereas accounting for hedging contracts currently requires many entries month on month until the hedge contract expires.
It is only common sense that the fee charged by the insurer for the VaR Insurance, would be less than possible loss amount. By my calculations, the fee would equate to be about 5 - 7.5%, but not limited to 5%, could be less (say 2.5%) if market conditions are trending upwards, or more than 10% if market trends are declining, of the calculated VaR for that given asset class.
CONCLUSION. In an age where Information and Technology has enabled a more precise art of monitoring the economics within Asset markets, there appears to be no end as to the financial products now available to Institutions, Retail Investors and Businesses to help them better predict the future and hedge against possible risk for risk factors, Operational, Market and Credit risk. In this case, VaR is the foundation for the insurer to calculate the possible investment loss, but to offer insurance to an investor for any such possible loss is still not done in todays market, and where this patent simple business process, of offering insurance based upon a VaR calculation could be another cog in the wheel of possible financial devices, available to investors that offers a; “concrete, useful, and tangible outcome".
Obviously insurance as a business method would not be patentable, due to its readily accepted obvious nature, but my VaR Insurance, uses a combination of Asset VaR, underwriters margin based upon VaR, which if applied via software or Al, would be defined by algorithms, which like Google search engine was patentable. Amazon's 1-click buying process is another relatable patent that I would deem my patent would use as precedents of prior successful patent application approved. I say algorithms not algorithm, because depending on the asset VaR calculation, the underwriter margin would fluctuate and hence, variances between a standard one algorithm would need to be applied to the differing asset classes covered by this patent application. It would be too exhaustive to list on this patent application, each algorithm for EQUITY or FIXED INCOME = each EXCHANGE listed company share/stock/security price data, FOREX = each country dollar value, REAL ESTATE = each suburb or city property price data for the VaR calculation.
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Substitute Sheet (Rule 26) RO/AU "VaR Insurance" step by step digital algorithm framework process.
Step 1. Calculate VaR of asset from data derived from sources such as; corelogic or yahoo finance.
Step 2. Calculate insurance sum of asset VaR using insurers margin of either 2.5, 5, 7.5 or 10 % of VaR value.
Step 3. Quote insurance sum to investor based upon investor request quote button on platform like Corelogic or CommSec or underwriters website.
Step 4. Initiate or Terminate VaR insurance sum QUOTE to investor.
Step 4a. If INITIATE, then accept payment from investor for asset VaR insurance.
Step 5. Provide investor with "asset VaR insurance" policy via email.
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Substitute Sheet (Rule 26) RO/AU
Next Patent: AUTOMOTIVE AWNING SYSTEM