Long-time holding Redwood Trust (RWT, Financial) was one of our most significantly impacted investments this year, as credit markets seized even more severely than equities in the first quarter, forcing management to take decisive steps to shore up the company's balance sheet and liquidity. These actions were necessary and well-received, helping shares recover some of the first quarter's losses. As shares recovered, however, what we considered to be a less favorable risk/reward outlook led us to close our position during the third quarter.
From Wallace Weitz (Trades, Portfolio)'s Partners III Opportunity Fund fourth-quarter 2020 shareholder letter.
