Strategy #0000000074 · Innovation investment and intangible assets
R&D investment and intangible capital
Calculate R&D/sales and R&D/assets, then compare assumed net returns for high- and low-intensity baskets.
R&D, advertising, brand and organisational capital are accounted for differently from physical assets; expensing may understate long-lived investment. Research finds information in R&D-intensive firms and R&D capital. Intensity can also mean higher uncertainty, and cross-industry comparability is limited. The simulator keeps intensity ratios separate from return assumptions.
Expensing, patent quality and development lags affect interpretation; entered returns are assumptions.
Three ways in
Understand the story. Then inspect the risk.
Start with a familiar situation, check the payoff, then test how the numbers change.
The idea · in two minutes
How does R&D intensity compare with assumed returns and costs across baskets?
R&D, advertising, brand and organisational capital are accounted for differently from physical assets; expensing may understate long-lived investment. Research finds information in R&D-intensive firms and R&D capital. Intensity can also mean higher uncertainty, and cross-industry comparability is limited. The simulator keeps intensity ratios separate from return assumptions.
Calculate R&D/sales and R&D/assets, then compare assumed net returns for high- and low-intensity baskets.
Expensing, patent quality and development lags affect interpretation; entered returns are assumptions.
- Signal metricCalculate R&D/sales and R&D/assets, then compare assumed net returns for high- and low-intensity baskets.
- Assumed return spreadExpensing, patent quality and development lags affect interpretation; entered returns are assumptions.
Illustrative research examples only. They are not live signals or a recommendation.
The mechanics · payoff and exposure
RD/Sales=\frac{\text{R\&D}}{Sales},\quad RD/Assets=\frac{\text{R\&D}}{Assets},\quad R_{LS}=R_H-R_L-C
R&D is current-period expense; intensity is not R&D efficiency or evidence of future innovation success.
Greeks: the directional intuition
- 產業差異
- Measures sensitivity to implied volatility.
- 費用化偏誤
- Measures sensitivity to implied volatility.
- 結果不確定
- Measures sensitivity to implied volatility.
RD/Sales=\frac{\text{R\&D}}{Sales},\quad RD/Assets=\frac{\text{R\&D}}{Assets},\quad R_{LS}=R_H-R_L-C
Practical context · published observations
R&D investment and intangible capital: read the record with its caveats.
The chart uses the published figures or explicitly labelled study inputs below. A historical index or model replay is not the same as an investor’s realised account return.
Expensing, patent quality and development lags affect interpretation; entered returns are assumptions. Source ↗ · Methodology ↗
Change assumptions and inspect the scenario
Inputs illustrate the strategy mechanics; they are not live quotes, forecasts or investment advice.
Variants · same family, different risk levers
Related signals differ in measurement and implementation.
Compare the underlying signal and its limitations.
| Related strategy | Relationship | What changes | New cost or risk |
|---|---|---|---|
| Core measure | Fundamental sort | R&D, advertising, brand and organisational capital are accounted for differently from physical assets; expensing may understate long-lived investment. Research finds information in R&D-intensive firms and R&D capital. Intensity can also mean higher uncertainty, and cross-industry comparability is limited. The simulator keeps intensity ratios separate from return assumptions. | Expensing, patent quality and development lags affect interpretation; entered returns are assumptions. |
| Industry-neutral sort | Within-industry ranking | Compare firms with similar operating models. | Industry classification and small samples matter. |
| Quality blend | Multi-signal combination | Combine cash flow, profitability or growth. | Adds weighting and multiple-testing risk. |
Expensing, patent quality and development lags affect interpretation; entered returns are assumptions.
Read beyond the summary
References
Primary sources and research used to describe the strategy and its limits.