That said, the whole P&C world was up that day. Not sure why though. Whatever the reason, with WRB up at 1.55x book here, and at all-time highs, I decided to sell most of my long-held shares in the $59-$60 last week.
I've enjoyed holding a ridiculous number of shares the past 6 years, while the stock traded in the ridiculously undervalued 1.15x-1.50x book range.
But now that the stock is closer to what I deem the fair value range of 1.5x-2.0x book, I've scaled back from WRB being as much as 90% of portfolio (yes, you read that right) to a mere regular sized holding of 20%.
I'm a little bummed about the whole thing, as I would have loved to have ridden an undervalued WRB for many more years like the past 6. And yet, I'm a little relieved to be back to a large cash position to avoid the next market downturn, and then take advantage.
Such is the life of a value investor. And with WRB and the S&P at their highest valuations in 8-10 years (depends on which metric you choose for which), it's time to get more cautious.
Thank goodness for WRB, which stayed dirt cheap for so long after the financial crisis.