Patent ID: 7120599

Claim:
A computer implemented method for grouping assets included within a portfolio of assets for valuation purposes using a classification and regression tree based model, said method comprising the steps of: receiving from a seller a proposal to sell a portfolio of assets, the assets included within at least one segment defined by the seller; computing sum of squared error (SSE) values for the at least one defined portfolio segment using the classification and regression tree based model and the computer, wherein the classification and regression tree based model generates at least one cluster of assets included within the portfolio of assets for valuing each non-underwritten asset included within the at least one cluster, each non-underwritten asset included within the at least one cluster is assigned a value based on an average value assigned to underwritten assets included within the at least one cluster; computing SSE values for the at least one defined portfolio segment using a simple model and the computer, wherein the simple model assigns a single value to all non-underwritten assets within the at least one defined portfolio segment based on a value assigned to at least one underwritten asset included within the at least one defined portfolio segment; computing an error ratio between the SSE values based on the classification and regression tree based model and the SSE values based on the simple model for the at least one defined portfolio segment using the computer; ranking the at least one defined portfolio segment based on the computed error ratio; and using the ranking by a potential buyer to determine an amount to offer for purchasing assets included within the at least one defined portfolio segment.