What: Shares of Allied World Assurance Co Holdings (NYSE:AWH) were trading down about 11% at 3 p.m. EST as the market digested its disappointing fourth-quarter results.

So what: Allied World Assurance reported net income of $1.7 million, or $0.02 per diluted share for the fourth quarter of 2015. Operating income, which excludes gains and losses on the company's investment portfolio and foreign exchange losses, was $43 million, or $0.47 per share, compared to the consensus estimate of $0.59 per share.

Net premiums earned of $622.8 million also fell short of analysts' expectations of $646.3 million during the fourth quarter.

Now what: The company will hold a conference call to discuss the quarter on Thursday, but in the press release, the company quoted CEO Scott Carmilani, who said that "2015 was a challenging year, marked by a difficult underwriting environment and financial market volatility."

Notably, the company's full-year combined ratio of 95.1% was nearly 10 percentage points higher than in 2014. Though the financial markets weren't directly responsible for the company's miss -- fluctuations in its portfolio are not included in operating income, which is the figure analysts watch most closely -- they certainly didn't help. The company earned a paltry 0.1% on its investment portfolio, due to realized losses that consumed much of the yield it earned from a bond-heavy portfolio.