As a child, did you ever read about – and then make your own – pinhole cameras?
It's simple to do, and as a kid, it feels a lot like magic…
All you have to do is go into a very dark room on a very bright day, and then introduce light into the room through one tiny pinhole in a curtain.
There, reflected on the opposite wall, you'll see the outside world reflected in living color – but upside down!
This, of course, is because of the behavior of light rays – when they're pushed through this kind of tiny hole onto a flat surface, they cross and reform as an inverted image.
Eventually, the dark room became a box… the flat surface became photographic paper… and the camera obscura developed into the modern camera…
And that brings me to our topic today.
Rather than sift through endless numbers and financial statements to understand the health of a company, there's one tiny, simple number I look at that lets me know if it's a good idea to make a trade.