UK COMMERCIAL PROPERTY

UK Commercial Property

UK Commercial Property

Introduction

Intellectual property is an area of law, "which allows people to own their creativity and innovation in the same way that they can own physical property." Intellectual property rights provide people with control over ideas or information embodied in a valuable form of protection. It plays a major part in our modern business environment and becomes an increasingly valuable asset for establishing competitive advantage in all types of business. Currently many businesses dedicate as much attention to their ability to innovate, their strategy and creativity as they dedicate to their financial assets. This explains why businesses are so keen to protect these assets. Company, like IBM for example, was granted around 2,800 patents in year 2000. (Anderson 2007, 12)

The company now owns more that 19,000 US patents and 34,000 all over the world, which added $1.5 billion to their profits in 2000 by licensing patents and developing new technologies. There are a number of organisations, like for example World Intellectual Property Organization (WIPO), whose objective is to promote the global protection and use of intellectual property rights in a way that allows everyone to benefit. (Anderson 2007, 12)

Discussion

What types of savings and investments are there?

Savings and investment plans traditionally invest money in up to 5 main areas, known as 'asset classes'. These are:-

Cash

Cash deposit accounts attract interest but over time, the purchasing power of cash can be eroded by inflation. They are therefore most useful for short-term cash needs, by which we mean 0 - 5 years. To have a better chance of out-performing inflation over the medium to longer term (5 years plus) it should consider investments that include elements of government and corporate bonds as well as shares. (Anderson 2001, 23)

Government Bonds

Government bonds (known as Gilts) are loans to the Government, which attract a fixed rate of interest. They are considered relatively low risk as the chance of the Government defaulting on the agreement is low. They are traded on the stock exchange and their value can go up and down depending on current and anticipated interest and inflation rates. As they are low risk, the return is also low but will tend to out-perform cash investments over the longer term. (Gurry 2005, 110)

Corporate Bonds

Corporate bonds are loans to companies, which also attract interest, usually at a fixed rate. The risk and return associated with a corporate bond will depend on how financially secure the company is and how likely it is that the company will default on the loan. The more likely the company is to default on the loan, the higher the interest rate. Like Gilts, they are traded on the stock exchange and their value can go up and down. At Teachers Assurance, where we invest in corporate bonds, we predominantly choose companies at the lower end of the risk. (Blackmand 2003, 1709)

Shares

Investing in shares means one may buying a stake in a company. By doing so it may hoping to earn a return in the form of ...