Stockopedia explains Magic Formula Score
An overall ranking for each stock is created by combining the rank of a company's Return on Capital vs the market (its quality) with the rank of its Earnings Yield (its cheapness).
The Magic Formula Criteria
Greenblatt's magic formula is based on two key criteria: earnings yield and return on capital. The formula aims to identify companies that are both cheap and profitable, with the belief that these stocks have the highest potential for outsized returns.
The magic formula is a stock-picking strategy based on two financial metrics: earnings yield and return on capital (ROC). The strategy focuses on buying good companies at bargain prices, similar to Warren Buffett's approach, but Greenblatt simplifies the process into an easy-to-follow method.
This is how the two Magic Formula investing ratios are calculated: Return on invested capital (ROIC) = EBIT / (net working capital + net fixed assets). Earnings yield = EBIT / Enterprise value.
The magic formula investing strategy is based on a simple principle: buy good companies at good prices. It uses two key financial metrics to identify these companies: return on capital (ROC) and earnings yield (EY).
You can calculate the magic number for your SaaS business by subtracting the last quarter's annual recurring revenue (ARR) from the current quarter's ARR and dividing by your total customer acquisition cost (CAC) (your total sales and marketing spend) from the previous quarter.
The magic formula is a simple, rules-based system designed to bring high returns within reach of the average investor. By following a simple, algorithmic approach, the magic formula allows investors to easily identify outperforming or undervalued companies, without letting emotions or instinct cloud their judgment.
Never reveal the secret of an effect
You are more popular as a magician when the audience does not know how it is done. There is simply no benefit or gain in sharing the secret, in fact it kills the magic and you will not be able to perform the effect again to the same audience.
Magic Resistance (also Magic Resist), or MR, is one of the two damage resistance subtype stats. It reduces incoming magic damage by a percentage. Magic resistance stacks additively.
The Magic Formula, as explained by Joel Greenblatt in his book The Little Book that Beats the Market, involves ranking stocks based on two metrics: earnings yield (EBIT/enterprise value) and return on capital (EBIT/invested capital).
With simple interest, the amount you receive is calculated as a percentage of your original deposit. With compound interest, it's calculated as a percentage of your original deposit plus all accumulated interest. So the interest earns interest. Then the interest on the interest also earns interest, and so on.
For normally distributed data, approximately 30 observations are needed to have reasonably short confidence bounds on the variance estimate. While numbers such as 30 in this context should not be viewed as magic or absolutes, it is simplistic to dismiss them as lies or the product of laziness.
A team's magic number is how close it is to clinching a playoff berth. The magic number could also be the club's distance from winning the division or securing a wild-card spot. How is a magic number calculated? Games remaining + 1 - (losses by second-place team - losses by first-place team) = magic number.
There's no “magic number” that guarantees you'll be approved for a loan or receive better interest rates and terms. However, in many popular scoring models, borrowers need a minimum score of 670 for their credit to be considered “good.”
These 26 laws are (in order): The Law of Knowledge, Self-Knowledge, Cause & Effect, Synchronicity, Association, Similarity, Contagion, Positive Attraction, Negative Attraction, Names, Words of Power, Personification, Invocation, Evocation, Identification, Infinite Data, Finite Senses, Personal Universes, Infinite ...
For a one year loan, the total number of digits is equal to 78, which explains the term the Rule of 78. For a two year loan, the total sum of the digits would be 300. With the sum of the months calculated, the lender then weights the interest payments in reverse order applying greater weight to the earlier months.
MAGIC FORMULA OF ATTITUDE
In a nutshell, it is your 'Attitude' which determines success. You can achieve only what you think you can achieve. The attitude towards life – the strength of character of getting up after a fall, dusting yourself and starting afresh once again – determines how successful you become.
1-2-3 Magic divides the parenting responsibilities into three straightforward tasks: controlling negative behavior, encouraging good behavior, and strengthening the child-parent relationship. The program seeks to encourage gentle, but firm, discipline without arguing, yelling, or spanking.
The "magical number 7" and working memory capacity
Chunking is used by the brain's short-term memory as a method for keeping groups of information accessible for easy recall.