So basically, every Pokemon has a personality value attributed to them, which is used to determine a Pokemon's shininess. I don't know (or care) about how the math works but here it is if you understand it. Based off this formula, the standard probability of encountering a shiny in Gen VI is **1/4096**. (But 1/4092 is only 0.0000002% off 1/4096 so your guess wasn't *that* big of a mistake lol)

When the Shiny Charm is obtained, every Pokemon you encounter has another two extra personality values generated for it, essentially giving you two more chances to make that Pokemon shiny. This takes the probability from 1/4096 -> 3/4096. Note, it's not really 'multiplying' the chances; it's just adding two extra personality values.

So Pokemon bred via the Masuda Method are simply generated with another five personality values along with the two of the Shiny Charm. This brings the value to 8/4096, which when simplified, becomes **1/512 (0.002%)**. This is proven by the Burning__Karma's answer. Hooray! I'm not a failure.

## In Gen V

The Masuda Method adds 4 personality values and the Shiny Charm still adds 2, so Shiny Charm + Masuda Method would be 7/8192 or **~1/1170**.

Hope I helped. :)

Source, Source, Above link,