Innovations in the research of financial markets over the last fifty years are the foundation of a belief system that guides Magus's approach to investing. Today, the investment industry takes for granted the calculation of rates of return, but before the mid 1960s, there was neither a generally accepted way to calculate a total return nor a way to compare the returns of different funds. Of course this all changed with the arrival of computers and the collection of data for mutual funds as well as for individual stocks and bonds.

After thorough testing by financial economists this led to the development of asset pricing models to evaluate the risk/return characteristics of securities and portfolios, and also led to a theory of market efficiency that suggested excess returns were only achievable by taking on above-average risk. Studies documenting the failure of active managers to outperform market indices gave rise in the early 1970s to passively managed index funds that relied on capital markets as the source of investment returns.

Further research and data compilation over several decades led to the identification of the multiple equity asset classes and risk dimensions that form the basis of Magus's portfolio strategies.