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Strategies & Market Trends : Value Investing

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To: Esvida who wrote (2511)11/18/1997 9:51:00 AM
From: Paul Senior  Read Replies (2) of 78652
 
AlLe: more on MOTR and combined ratio:

Combined ratio found in annual reports. Essentially it is the total in percentage terms of losses (claims paid) + underwriting expenses. Most annual reports will show definition so you can understand more clearly than my response here. 1 minus combined ratio = underwriting profit. Many insurance don't have an underwriting profit -- they run from surplus account(s). A combined ratio under 100 is a good sign.
I checked quickly again MOTR on Yahoo. 36% ROE. This is either an incorrect figure or a number not sustainable IMO. IMO this is a warning sign ---it is not possible to have such good returns in this business - it's just too competitive in all markets, including niche. That's IMO. Show me where I'm wrong and I'll buy the stock -g-. Paul Senior
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