OK. Thank you all for the open-minded invitation to explain...

OK. Thank you all for the open-minded invitation to explain myself. I know you all pin me as a psycho downramper - sadly, I am merely nuts.

Have y'all read Graham and Dodd's 'Security Analysis'? Benjamin Graham was Buffett's mentor. Anyone trading in the sharemarket who has not is asking for trouble. Get and read it now. Tax deductible. It is a big book, though with clear and simple language.

One lesson this 1940 book taught me was to first form my own opinion of the value of a stock, how it makes its money and what it is worth. If my opinion is wrong or incomplete, I can learn something.

Why do I value QBE so lowly? This is a blue-chip with a long history of success.

Yeah. And the SP has been falling for 10 dreary years. Every now and again, the board sells off some more family silver to keep the remainder solvent and trading. I see from the 2017HY report it is exiting more countries, lines of business and shed long tail UK liabilities - at a discount, probably a substantial one. These arrangements are usually at an out-and-out loss for the company sloughing future liabilities.

QBE has always sought to securely meet its long term liabilities by investing in interest bearing assets. All but 7.3% of its investment assets are in government and corporate bonds or the short term money market. This was an excellent strategy when interest rates were high. Then when they were falling, it could make good gains on re-pricing long dated debt. This doesn't work anymore when i rates are at extreme lows, making very little, with the prospect of capital losses if i rates rise.

Oh, and look! QBE outperformed the debt market to make... 1.83%. Would you congratulate yourself on such a performance?

QBE's COR remains stubbornly high at 94.9%. This is inadequate with these poor investment returns. Nor do I see lessons learned or a catalyst for change. So down it will go.

My guess at $2.50 is not set in stone. It doesn't matter to me if it over or undershoots this target as I will review my opinion as events unfold.

My best wishes to QBE holders.

Ash