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Method and systems for quantifying cash flow recovery and risk

A risk-on-cash technique applied to the valuation of financial instruments

Inactive Publication Date: 2003-08-20
GE CAPITAL COMML FINANCE
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  • Summary
  • Abstract
  • Description
  • Claims
  • Application Information

AI Technical Summary

Problems solved by technology

There is a need to create a risk-limited "food chain" of choosing the lowest variance assumptions for asset valuations, since known systems have limitations in determining forecast probability distributions without comparable assets, especially over a limited time period There are limitations in the application of probability

Method used

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  • Method and systems for quantifying cash flow recovery and risk
  • Method and systems for quantifying cash flow recovery and risk
  • Method and systems for quantifying cash flow recovery and risk

Examples

Experimental program
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Embodiment Construction

[0026] Figure 1 is a schematic diagram illustrating the process of evaluating a large asset portfolio 12 through a known evaluation cycle until, for example, in an auction, bidding to purchase an asset portfolio 12 Picture 10 . Figure 1 is a high-level overview of a typical evaluation and extrapolation process 10 that is neither iterative nor automatic. Gesturing Picture 10 In, the appraiser evaluates 14 many individual assets in the portfolio 12 to generate the first part 16 that has been appraised and the remaining part 18 that is not touched. Before any asset is appraised, the first part 16 is zero percent of the asset 12, and the remaining part 18 is 100%. As the evaluation process progresses, the first part 16 increases and the remaining part 18 decreases. The stated goal is to evaluate as many assets as possible in order to purchase a portfolio of assets before bidding. The panel of assessors continues to assess 14 individually until the bid is about to be made. Perform a ...

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PUM

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Abstract

A method (32) of valuation of large groups of assets by selecting a lowest variation assumption for asset valuation in order to limit risk includes the steps of evaluating assets by all known valuation methodologies which have merit for those particular assets, selecting the valuation methodology which is most accurate for the assets being evaluated and assigning values to the assets. Individual asset values are developed and listed in tables so that individual asset values can be taken from the tables and grouped in any desired manner. The assets are divided into categories by credit variable and then rated individually.

Description

[0001] Related applications cited documents [0002] The present invention claims the rights of U.S. Provisional Application No. 60 / 173843 (application date December 30, 1999), which is hereby incorporated by reference in its entirety. Invention field [0003] The present invention generally relates to methods for the valuation of financial instruments, and more specifically, to the rapid valuation of a large number of financial instruments. Background of the invention [0004] Large amounts of assets, such as loans, for example, 10,000 loans, or other financial instruments, sometimes become for sale due to economic conditions, planned or unplanned deprivation, or legal compensation. Sometimes it is necessary to sell thousands of commercial loans or other financial instruments with assets sometimes amounting to billions of dollars within a few months. Of course, sellers of assets want to optimize the value of their portfolio, sometimes grouping assets into “tranches”. The term "sh...

Claims

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Application Information

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Patent Type & Authority Applications(China)
IPC IPC(8): G06F17/18G06Q40/00
CPCG06Q40/025G06Q40/00G06Q40/04G06Q40/08G06Q40/03G06Q40/06
Inventor C·D·约翰森T·K·凯耶斯D·J·斯潘塞C·L·米德基夫R·P·梅斯默C·皮苏帕蒂Y-T·陈
Owner GE CAPITAL COMML FINANCE