The higher the MOS (Margin of Safety) the higher potential returns you can make. MOS is the Share Price discount off the Fair Value.
Within Tykr, we like to see a MOS of 50% or more.
If the Share Price is $100 and the Fair Value is $200, that means the MOS is 50%. ($100 is 50% off $200).
If the Share Price is $100 and the Fair Value is $400, that means the MOS is 75%. ($100 is 75% off $400).
Think of it like buying groceries. When you go shopping for food, do you want to pay full price or do you want to find a deal? Personally, I never like to pay full price on groceries and I never like to pay full price on stocks!
If you’re interested, visit our calculations section to learn how the MOS is calculated. . The math behind Tykr is open source. No “hidden secrets”.