Financial Instruments (Tables)

9 Months Ended

Aug. 31, 2011

Summary of fair value of financial assets and liabilities measured on recurring basis


	As of August 31, 2011
								Counterparty
								and Cash
								Collateral
	Level 1 (3)		Level 2 (3)		Level 3			Netting (2)			Total
Assets:
Financial instruments owned:
Corporate equity securities	$	1,523,277	$	141,909	$	11,412		$	—		$	1,676,598
Corporate debt securities		7,438		4,150,581		55,230			—			4,213,249
Collateralized debt obligations		—		92,298		96,664			—			188,962
U.S. government and federal agency securities		1,932,703		230,780		—			—			2,163,483
Municipal securities		—		682,807		686			—			683,493
Sovereign obligations		1,994,296		690,154		128			—			2,684,578
Residential mortgage-backed securities		—		3,787,720		171,519			—			3,959,239
Commercial mortgage-backed securities		—		488,196		40,195			—			528,391
Other asset-backed securities		—		107,538		3,478			—			111,016
Loans and other receivables		—		364,518		164,163			—			528,681
Derivatives		967,618		1,557,787		155			(1,609,418	)		916,142
Investments at fair value		—		24,405		92,428			—			116,833
Physical commodities		—		369,281		—			—			369,281

Total financial instruments owned	$	6,425,332	$	12,687,974		636,058		$	(1,609,418	)	$	18,139,946

Level 3 assets for which the firm does not bear economic exposure (1)						(68,987	)

Level 3 assets for which the firm bears economic exposure					$	567,071


Cash and securities segregated and on deposit for regulatory purposes	$	407,096	$	—	$	—		$	—		$	407,096
Securities received as collateral	$	40,401	$	—	$	—		$	—		$	40,401

Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	1,622,547	$	113,615	$	59		$	—		$	1,736,221
Corporate debt securities		21,901		2,450,144		—			—			2,472,045
U.S. government and federal agency securities		2,381,050		351,749		—			—			2,732,799
Sovereign obligations		1,830,082		715,354		—			—			2,545,436
Residential mortgage-backed securities		—		81,955		—			—			81,955
Commercial mortgage-backed securities		—		117		—			—			117
Loans		—		144,188		11,458			—			155,646
Derivatives		674,857		1,836,983		3,601			(1,919,499	)		595,942

Total financial instruments sold, not yet purchased	$	6,530,437	$	5,694,105	$	15,118		$	(1,919,499	)	$	10,320,161

Obligation to return securities received as collateral	$	40,401	$	—	$	—		$	—		$	40,401


(1)		Consists of Level 3 assets attributable to third party or employee noncontrolling interests in certain consolidated entities.

(2)		Represents counterparty and cash collateral netting across the levels of the fair value hierarchy for positions with the same counterparty.


(3)		There were no significant transfers between Level 1 and Level 2 for the three-months and nine-months ended August 31, 2011.


	As of November 30, 2010
								Counterparty
								and Cash
								Collateral
	Level 1		Level 2		Level 3			Netting (2)			Total
Assets:
Financial instruments owned:
Corporate equity securities	$	1,453,744	$	89,430	$	22,619		$	—		$	1,565,793
Corporate debt securities		25		3,557,183		73,408			—			3,630,616
Collateralized debt obligations		—		27,863		31,121			—			58,984
U.S. government and federal agency securities		2,322,204		210,422		—			—			2,532,626
Municipal securities		—		477,462		472			—			477,934
Sovereign obligations		1,600,762		580,651		—			—			2,181,413
Residential mortgage-backed securities		—		3,912,708		132,359			—			4,045,067
Commercial mortgage-backed securities		—		524,614		6,004			—			530,618
Other asset-backed securities		—		286,329		567			—			286,896
Loans and other receivables		—		206,977		227,596			—			434,573
Derivatives		279,811		176,069		—			(336,612	)		119,268
Investments at fair value		—		—		77,784			—			77,784

Total financial instruments owned	$	5,656,546	$	10,049,708		571,930		$	(336,612	)	$	15,941,572

Level 3 assets for which the firm does not bear economic exposure (1)						(204,139	)

Level 3 assets for which the firm bears economic exposure					$	367,791


Securities received as collateral	$	48,616	$	—	$	—		$	—		$	48,616

Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	1,554,489	$	83,845	$	38		$	—		$	1,638,372
Corporate debt securities		—		2,375,925		—			—			2,375,925
U.S. government and federal agency securities		1,688,684		51,604		—			—			1,740,288
Municipal securities		—		170		—			—			170
Sovereign obligations		2,180,667		814,163		—			—			2,994,830
Residential mortgage-backed securities		—		127,547		—			—			127,547
Commerical mortgage-backed securities		—		1,837		—			—			1,837
Loans		—		124,050		47,228			—			171,278
Derivatives		241,860		240,866		2,346			(425,520	)		59,552

Total financial instruments sold, not yet purchased	$	5,665,700	$	3,820,007	$	49,612		$	(425,520	)	$	9,109,799


Obligation to return securities received as collateral	$	48,616	$	—	$	—		$	—		$	48,616

(1)		Consists of Level 3 assets which are either financed by nonrecourse secured financings or attributable to third party or employee noncontrolling interests in certain consolidated entities.

(2)		Represents counterparty and cash collateral netting across the levels of the fair value hierarchy for positions with the same counterparty.

Investments in entities


	August 31, 2011
			Unfunded		Redemption Frequency
	Fair Value (f)		Commitments		(if currently eligible)
Equity Long/Short Hedge Funds ^(a)	$	27,282	$	—	Monthly, Quarterly, Semiannually
High Yield Hedge Funds^(b)		993		—		—
Fund of Funds^(c)		881		127	Annually
Private Equity Funds^(d)		21,198		5,897		—
Commodity Funds^(e)		14,569		—	Bi-Monthly

Total^(g)	$	64,923	$	6,025


	November 30, 2010
			Unfunded		Redemption Frequency
	Fair Value (f)		Commitments		(if currently eligible)
Equity Long/Short Hedge Funds ^(a)	$	19,865	$	—	Quarterly, Semiannually
High Yield Hedge Funds^(b)		1,561		—		—
Fund of Funds^(c)		2,622		131	Annually
Private Equity Funds^(d)		26,567		6,792		—
Other Investments^(h)		287		—	At Will

Total^(g)	$	50,902	$	6,923


(a)		This category includes investments in hedge funds that invest in both long and short equity securities in domestic and international markets in both public and private sectors. At August 31, 2011 and November 30, 2010, investments representing approximately 98% and 67%, respectively, of the fair value in this category are redeemable with 30 - 90 days prior written notice. At November 30, 2010, investments representing approximately 30% of fair value cannot be redeemed until the lock-up period expired on December 31, 2010. At August 31, 2011 and November 30, 2010, investments representing approximately 2% and 3% respectively, of fair value cannot be redeemed as they are in liquidation and distributions will be received through the liquidation of the underlying assets of the funds. We are unable to estimate when the underlying assets will be liquidated. At August 31, 2011 and November 30, 2010, an investment representing less than 1% of fair value has no redemption provisions; distributions are received through the liquidation of the underlying assets of the fund which is estimated to be within one to two years.

(b)		This category includes investments in funds that invest in domestic and international public high yield debt, private high yield investments, senior bank loans, public leveraged equities, distressed debt, and private equity investments. There are no redemption provisions and distributions are received through the liquidation of the underlying assets of the funds. At August 31, 2011 and November 30, 2010, these investments are currently in liquidation and we are unable to estimate when the underlying assets will be fully liquidated.

(c)		This category includes investments in fund of funds that invest in various private equity funds. At August 31, 2011 and November 30, 2010, approximately 95% and 41%, respectively, of the fair value of investments in this category is managed by us and has no redemption provisions. Distributions are received through the liquidation of the underlying assets of the fund of funds, which are estimated to be liquidated in one to three years. At August 31, 2011 we requested redemption for investments representing approximately 5% of fair value at August 31, 2011, however we are unable to estimate when these funds will be returned. At November 30, 2010, investments representing approximately 59% of the fair value were approved for redemption and the funds’ net asset values were received in the first quarter of 2011.


(d)		At August 31, 2011 and November 30, 2010, investments representing approximately 81% and 74% respectively, include investments in private equity funds that invest in the equity of various private companies in the energy, technology, internet service and telecommunication service industries including acquired or restructured companies. These investments cannot be redeemed; distributions are received through the liquidation of the underlying assets of the funds and are expected to liquidate in one to ten years. At August 31, 2011, a fund that invests in Croatian companies represents approximately 19% of the total investment in private equity funds. At November 30, 2010, funds that invest in Croatian and Vietnamese companies represent approximately 26% of the total investment in private equity funds.

(e)		At August 31, 2011, this category included investments in funds that invest in various commodity futures contracts on futures exchanges and forward contracts, exchange-traded options on futures contracts and other commodity-related or commodity-linked financial instruments. These investments can be redeemed on the fifteenth and last calendar day of each month with prior written notice within five business days.

(f)		Fair value has been estimated using the net asset value derived from each of the funds’ partner capital statements.

(g)		Investments at fair value, in the Consolidated Statements of Financial Condition at August 31, 2011 and November 30, 2010 include $51.9 million and $26.9 million, respectively, of direct investments which are not investment companies and therefore are not part of this disclosure table.

(h)		Other Investments at November 30, 2010 included investments in closed-ended funds that invested in Vietnamese equity and debt instruments.

Financial instruments owned and Financial instruments sold, not yet purchased


	August 31, 2011						November 30, 2010
				Financial						Financial
	Financial			Instruments Sold,			Financial			Instruments Sold,
	Instruments			Not Yet			Instruments			Not Yet
	Owned			Purchased			Owned			Purchased
Exchange closing prices		10	%		16	%		9	%		17	%
Recently observed transaction prices		7	%		2	%		5	%		2	%
Data providers/pricing services		67	%		74	%		65	%		60	%
Broker quotes		1	%		1	%		12	%		19	%
Valuation techniques		15	%		7	%		9	%		2	%

		100	%		100	%		100	%		100	%

Summary of changes in fair value of financial assets and liabilities classified as Level 3


	Three Months Ended August 31, 2011
																Change in
			Total gains/			Purchases,										unrealized gains/
			losses			sales,										(losses) relating to
			(realized and			settlements,			Transfers		Transfers			Balance,		instruments still held
	Balance,		unrealized)			and issuances,			into		out of			August 31,		at August 31, 2011
	May 31, 2011		(1)			net			Level 3		Level 3			2011		(1)
Assets:
Financial instruments owned:
Corporate equity securities	$	18,230	$	1,720		$	2,631		$	861	$	(12,030	)	$	11,412	$	(154	)
Corporate debt securities		39,688		(4,069	)		6,230			14,425		(1,044	)		55,230		(7,349	)
Collateralized debt obligations		84,046		(3,417	)		9,325			19,029		(12,319	)		96,664		(5,413	)
Municipal securities		858		11			(183	)		—		—			686		1
Sovereign obligations		—		—			128			—		—			128		—
Residential mortgage-backed securities		206,721		(12,527	)		15,276			41,510		(79,461	)		171,519		(12,917	)
Commercial mortgage-backed securities		33,516		(3,652	)		(292	)		17,364		(6,741	)		40,195		(3,690	)
Other asset-backed securities		9,352		(329	)		2,773			99		(8,417	)		3,478		(329	)
Loans and other receivables		261,056		710			(92,362	)		27,077		(32,318	)		164,163		(116	)
Investments at fair value		71,008		2,397			19,045			11		(33	)		92,428		(938	)

Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	38	$	21		$	—		$	—	$	—		$	59	$	20
Net derivatives (2)		2,739		696			—			—		11			3,446		687
Loans		6,398		(230	)		5,290			—		—			11,458		(230	)


(1)		Realized and unrealized gains/ losses are reported in Principal transactions in the Consolidated Statements of Earnings.

(2)		Net derivatives represent Financial instruments owned — Derivatives and Financial instruments sold, not yet purchased — Derivatives.


	Three Months Ended August 31, 2010
																Change in
			Total gains/													unrealized gains/
			losses			Purchases,										(losses) relating to
	Balance,		(realized and			sales,			Transfers		Transfers			Balance,		instruments still held
	May 31,		unrealized)			settlements,			into		out of			August 31,		at August 31, 2010
	2010		(1)			and issuances			Level 3		Level 3			2010		(1)
Assets:
Financial instruments owned:
Corporate equity securities	$	21,918	$	1,327		$	2,751		$	—	$	(417	)	$	25,579	$	(789	)
Corporate debt securities		100,275		(714	)		3,149			54		(1,480	)		101,284		(813	)
Collateralized debt obligations		21,957		(495	)		352			4,492		—			26,306		(615	)
U.S. issued municipal securities		436		(7	)		—			—		—			429		(7	)
Residential mortgage-backed securities		148,833		5,914			(8,770	)		23,143		(1,281	)		167,839		404
Commercial mortgage-backed securities		1,000		—			50			—		(1,000	)		50		—
Other asset-backed securities		369		—			(369	)		—		—			—		—
Loans and other receivables		145,181		(4,735	)		(55,105	)		—		—			85,341		(4,139	)
Investments at fair value		72,297		8,060			(3,724	)		2,723		—			79,356		9,145

Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	38	$	—		$	—		$	58	$	—		$	96	$	—
Corporate debt securities		14,365		(1,275	)		(13,090	)		—		—			—		—
Net derivatives (2)		1,271		523			—			—		(500	)		1,294		523
Loans		68,242		—			(42,130	)		—		—			26,112		—


(1)		Realized and unrealized gains/ losses are reported in Principal transactions in the Consolidated Statements of Earnings.

(3)		Net derivatives represent Financial instruments owned — derivatives and Financial instruments sold, not yet purchased — derivatives.


	Nine Months Ended August 31, 2011
																Change in
			Total gains/			Purchases,										unrealized gains/
			losses			sales,										(losses) relating to
	Balance,		(realized and			settlements,			Transfers		Transfers			Balance,		instruments still held
	November 30,		unrealized)			and issuances,			into		out of			August 31,		at August 31, 2011
	2010		(1)			net			Level 3		Level 3			2011		(1)
Assets:
Financial instruments owned:
Corporate equity securities	$	22,619	$	2,905		$	(3,040	)	$	816	$	(11,888	)	$	11,412	$	(422	)
Corporate debt securities		73,408		(487	)		(22,533	)		6,304		(1,462	)		55,230		(5,906	)
Collateralized debt obligations		31,121		10,423			54,351			779		(10	)		96,664		9,632
Municipal securities		472		89			125			—		—			686		78
Sovereign obligations		—		—			128			—		—			128		—
Residential mortgage-backed securities		132,359		(8,354	)		64,906			29,901		(47,293	)		171,519		(25,284	)
Commercial mortgage-backed securities		6,004		1,625			25,574			6,992		—			40,195		112
Other asset-backed securities		567		(604	)		3,156			926		(567	)		3,478		(604	)
Loans and other receivables		227,596		2,476			(57,473	)		9,006		(17,442	)		164,163		(1,452	)
Investments at fair value		77,784		9,326			8,421			—		(3,103	)		92,428		6,495

Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	38	$	21		$	—		$	—	$	—		$	59	$	20
Net derivatives (2)		2,346		1,100			—			—		—			3,446		1,200
Loans		47,228		(230	)		(35,540	)		—		—			11,458		(230	)


(1)		Realized and unrealized gains/ losses are reported in Principal transactions in the Consolidated Statements of Earnings.

(2)		Net Derivatives represent Financial instruments owned — derivatives and Financial instruments sold, not yet purchased — Derivatives.


	Eight Months Ended August 31, 2010
																Change in
						Purchases,										unrealized gains/
			Total gains/			sales,										(losses) relating to
	Balance,		losses			settlements,			Transfers		Transfers			Balance,		instruments still
	December		(realized and			and			into		out of			August 31,		held at August 31,
	31, 2009		unrealized) (1)			issuances			Level 3		Level 3			2010		2010 (1)
Assets:
Financial instruments owned:
Corporate equity securities	$	43,042	$	(20,125	)	$	5,467		$	143	$	(2,948	)	$	25,579	$	(22,524	)
Corporate debt securities		116,648		(1,056	)		(1,084	)		75		(13,299	)		101,284		1,060
Collateralized debt obligations		9,570		5,397			4,067			7,272		—			26,306		4,840
U.S. issued municipal securities		420		9			—			—		—			429		9
Sovereign obligations		196		—			—			—		(196	)		—		—
Residential mortgage-backed securities		136,496		21,857			(5,893	)		23,435		(8,056	)		167,839		6,888
Commercial mortgage-backed securities		3,215		11			(1,241	)		—		(1,935	)		50		—
Other asset-backed securities		110		—			(110	)		—		—			—		—
Loans and other receivables		506,542		38,029			(302,151	)		—		(157,079	)		85,341		14,960
Investments at fair value		65,564		13,744			(3,991	)		4,039		—			79,356		11,029

Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	—	$	—		$	—		$	96	$	—		$	96	$	—
Corporate debt securities		—		(2,210	)		2,210			—		—			—		—
Net derivatives (2)		6,835		(3,585	)		—			—		(1,956	)		1,294		(3,585	)
Loans		352,420		(344	)		(214,670	)		—		(111,294	)		26,112		—


(1)		Realized and unrealized gains/ losses are reported in Principal transactions in the Consolidated Statements of Earnings.

(2)		Net derivatives represent Financial instruments owned — derivatives and Financial instruments sold, not yet purchased — derivatives.

- Definition

Tabular disclosure of the fair value of investees that calculate net asset value per share (including by unit, membership interest, or other equity (ownership interest) unit measure) (alternative investments), whether measured at fair value on a recurring or nonrecurring basis, by major category of assets and liabilities (as defined), including, for example, (i) fair value measurements at the reporting date, (ii) the level within the fair value hierarchy in which the fair value measurements fall, (iii) a reconciliation of beginning and ending balances for those alternative investments that are measured at fair value using unobservable inputs (Level 3 - fair value hierarchy fair value measurement inputs), (iv) the inputs and valuation techniques used to measure fair value, (v) a discussion of changes to valuation techniques and inputs, if any, during the period, (vi) a description of the nature and risk associated with the alternative investments, and (vii) a discussion of the probability that any of the alternative investments are to be sold.

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