Using Patent Drawings to Differentiate Stock Return Rate of China Listed Companies. A Study on China Patent Species of Utility Model Grant

Abstract

Abstract Patent is an important outcome of technological innovation. Though patent claim always caught attention when considering patent quality, it had to be supported by the drawings according to the patent examination criteria. However, patent drawing was seldom discussed. Based on the company integrated database, more than 50% of China listed companies of RMB common stocks (A-shares) from 2017Q1 to 2021Q4 were selected as effective samples. The effect of China utility model grant patent’s drawing count for differentiating A-share’s stock return rate was thoroughly discussed via analysis of variation (ANOVA). The average drawing count and the total drawing count of utility model grants significantly increased over previous five years. The total drawing count of utility model grants was found to be an appropriate patent indicator for differentiating A-share’s stock return rate whereas the average drawing count was not. The A-shares in the highest total drawing count groups of utility model grants showed significantly higher stock return rate means while the A-shares in the lower total drawing count groups showed significantly lower stock return rate means mostly from 2017Q1 to 2021Q4. The finding also proved that the utility model grant’s patent quantity still mattered in China stock market. JEL classification numbers: C38, C46, G11, G12. Keywords: ANOVA, Stock return rate, Patent drawing, Utility model grant.