%0 Journal Article %A Andrew E. Katz %T Financial Alchemy Turns Intellectual Property Into Cash %B Securitization of Trademarks, Copyrights,and Other Intellectual Property Assets %D 2003 %R 10.3905/jsf.2003.320294 %J The Journal of Structured Finance %P 55-58 %V 8 %N 4 %X Today, virtually any form of intellectual property, from patents on semiconductor chips and pharmaceuticals to copyrights on rock-and-roll hits or feature films and trademarks on popular merchandise, can be considered for securitization. The issue is not the form of the asset, but whether it generates a reasonably predictable future cash flow that can be adequately isolated from the business risks of the owner of that cash flow. Even unrated entities can escape the high costs associated with conventional bank financing and instead issue highly rated, investment-grade securities that carry a lower rate of interest. However, the potential issuer of intellectual-property-backed securities must be aware that the financial community still considers them to be somewhat esoteric and therefore carefully scrutinizes the structure of the transaction and the bona fides of the originator/servicer. As with other asset-backed securities, intellectual-property-backed securities can be accounted for as either sales of assets or secured financing under GAAP. %U https://jsf.pm-research.com/content/iijstrfin/8/4/55.full.pdf