Financial Instruments (Tables)

3 Months Ended

Feb. 29, 2012

Financial Instruments [Abstract]

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

	As of February 29, 2012
	Level 1(1)		Level 2(1)		Level 3			Counterparty and Cash Collateral Netting(2)			Total
Assets:
Financial instruments owned:
Corporate equity securities	$	1,353,650	$	102,486	$	30,269		$	—		$	1,486,405
Corporate debt securities		—		3,054,240		33,606			—			3,087,846
Collateralized debt obligations		—		92,437		72,576			—			165,013
U.S. government and federal agency securities		1,733,090		149,347		—			—			1,882,437
Municipal securities		—		550,652		1,176			—			551,828
Sovereign obligations		1,722,093		896,031		140			—			2,618,264
Residential mortgage-backed securities		—		2,773,880		128,751			—			2,902,631
Commercial mortgage-backed securities		—		309,009		35,792			—			344,801
Other asset-backed securities		—		5,813		5,389			—			11,202
Loans and other receivables		—		322,685		104,449			—			427,134
Derivatives		421,790		1,603,348		120			(1,713,102	)		312,156
Investments at fair value		—		27,609		78,110			—			105,719
Physical commodities		—		205,112		—			—			205,112
Total financial instruments owned	$	5,230,623	$	10,092,649	$	490,378		$	(1,713,102	)	$	14,100,548
Level 3 financial instruments for which the firm does not bear economic exposure(4)					$	(55,510	)
Level 3 financial instruments for which the firm bears economic exposure					$	434,868
Investments in managed funds	$	—	$	—	$	73,015		$	—		$	73,015
Cash and securities segregated and on deposit for regulatory purposes(3)	$	189,783	$	—	$	—		$	—		$	189,783
Securities received as collateral	$	984	$	—	$	—		$	—		$	984
Total Level 3 assets for which the firm bears economic exposure					$	507,883
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	1,485,750	$	19,936	$	11,511		$	—		$	1,517,197
Corporate debt securities		—		1,893,206		74						1,893,280
U.S. government and federal agency securities		1,971,525		—		—			—			1,971,525
Sovereign obligations		1,429,098		879,050		—			—			2,308,148
Residential mortgage-backed securities		—		16,540		—			—			16,540
Commercial mortgage-backed securities		—		172		—			—			172
Loans		—		93,606		—			—			93,606
Derivatives		384,282		1,622,580		8,430			(1,814,047	)		201,245
Total financial instruments sold, not yet purchased	$	5,270,655	$	4,525,090	$	20,015		$	(1,814,047	)	$	8,001,713
Obligation to return securities received as collateral	$	984	$	—	$	—		$	—		$	984

(1) There were no significant transfers between Level 1 and Level 2 for the three months ended February 29, 2012.

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

(3) Consists of U.S. government securities segregated for regulatory purposes and measured at fair value.

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

	As of November 30, 2011
	Level 1(1)		Level 2(1)		Level 3			Counterparty and Cash Collateral Netting(2)			Total
Assets:
Financial instruments owned:
Corporate equity securities	$	1,088,358	$	133,232	$	13,489		$	—		$	1,235,079
Corporate debt securities		1,521		2,818,643		48,140			—			2,868,304
Collateralized debt obligations		—		102,209		47,988			—			150,197
U.S. government and federal agency securities		5,443,721		266,460		—			—			5,710,181
Municipal securities		—		582,497		6,904			—			589,401
Sovereign obligations		737,082		434,759		140			—			1,171,981
Residential mortgage-backed securities		—		2,961,682		149,965			—			3,111,647
Commercial mortgage-backed securities		—		582,974		52,407			—			635,381
Other asset-backed securities		—		22,794		3,284			—			26,078
Loans and other receivables		—		278,855		97,291			—			376,146
Derivatives		632,148		2,344,625		124			(2,451,004	)		525,893
Investments at fair value		—		27,259		78,326			—			105,585
Physical commodities		—		172,668		—			—			172,668
Total financial instruments owned	$	7,902,830	$	10,728,657	$	498,058		$	(2,451,004	)	$	16,678,541
Level 3 financial instruments for which the firm does not bear economic exposure(4)					$	(45,901	)
Level 3 financial instruments for which the firm bears economic exposure					$	452,157
Investments in managed funds	$	—	$	—	$	70,740		$	—		$	70,740
Cash and securities segregated and on deposit for regulatory purposes(3)	$	115,000	$	—	$	—		$	—		$	115,000
Securities received as collateral	$	21,862	$	—	$	—		$	—		$	21,862
Total Level 3 assets for which the firm bears economic exposure					$	522,897
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	1,266,096	$	64,000	$	—		$	—		$	1,330,096
Corporate debt securities		—		1,614,419		74			—			1,614,493
U.S. government and federal agency securities		2,032,091		9,685		—			—			2,041,776
Municipal securities		—		90		—			—			90
Sovereign obligations		790,568		377,279		—			—			1,167,847
Residential mortgage-backed securities		—		50,517		—			—			50,517
Loans		—		140,960		10,157			—			151,117
Derivatives		535,503		2,289,759		9,409			(2,585,634	)		249,037
Total financial instruments sold, not yet purchased	$	4,624,258	$	4,546,709	$	19,640		$	(2,585,634	)	$	6,604,973
Obligation to return securities received as collateral	$	21,862	$	—	$	—		$	—		$	21,862

(1) There were no significant transfers between Level 1 and Level 2 for the twelve-months ended November 30, 2011.

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

(3) Consists of U.S. government securities segregated for regulatory purposes and measured at fair value.

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

Investments in entities

	February 29, 2012
	Fair Value (7)		Unfunded Commitments		Redemption Frequency (if currently eligible)
Equity Long/Short Hedge Funds(1)	$	28,009	$	—	Monthly, Quarterly
High Yield Hedge Funds(2)		898		—	—
Fund of Funds(3)		772		126	—
Equity Funds(4)		88,903		65,386	—
Convertible Bond Funds(5)		2,985		—	At Will
Other Investments(6)		20		—	Bi-Monthly
Total(8)	$	121,586	$	65,512

	November 30, 2011
	Fair Value (7)		Unfunded Commitments		Redemption Frequency (if currently eligible)
Equity Long/Short Hedge Funds(1)	$	27,604	$	—	Monthly, Quarterly
High Yield Hedge Funds(2)		938		—	—
Fund of Funds(3)		772		126	—
Equity Funds(4)		88,294		74,283	—
Convertible Bond Funds(5)		2,827		—	At Will
Other Investments(6)		19		—	Bi-Monthly
Total(8)	$	120,454	$	74,409

(1) 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 February 29, 2012 and November 30, 2011, investments representing approximately 98%, of the fair value in this category are redeemable with 30 — 65 days prior written notice. At February 29, 2012 and November 30, 2011, investments representing approximately 2%, 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 February 29, 2012 and November 30, 2011, 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.

(2) 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. At February 29, 2012 and November 30, 2011, these investments are currently in liquidation and we are unable to estimate when the underlying assets will be fully liquidated.

(3) This category includes investments in fund of funds that invest in various private equity funds. At February 29, 2012 and November 30, 2011, approximately 99% and 95%, 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 two years. At February 29, 2012 and at November 30, 2011, we requested redemption for investments representing approximately 1% and 5% of fair value, respectively, however we are unable to estimate when these funds will be returned.

(4) At February 29, 2012 and November 30, 2011, investments representing approximately 96%, include investments in 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. At February 29, 2012 and November 30, 2011, a fund that invests in Croatian companies represents approximately 4% of the total investment in equity funds. 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 eight years.

(5) This category includes an investment in an open-ended investment company that invests primarily in convertible bonds. This investment is redeemable with 5 days prior written notice.

(6) Other investments at February 29, 2012 and November 30, 2011 included investments in funds that invest in commodities futures and options contracts.

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

(8) Investments at fair value in the Consolidated Statements of Financial Condition at February 29, 2012 and November 30, 2011 include $57.1 million and $55.9 million, respectively, of direct investments which are not investment companies and therefore are not part of this disclosure table.

Financial instruments owned and Financial instruments sold, not yet purchased

	February 29, 2012						November 30, 2011
	Financial Instruments Owned			Financial Instruments Sold, Not Yet Purchased			Financial Instruments Owned			Financial Instruments Sold, Not Yet Purchased
Exchange closing prices		7	%		14	%		7	%		19	%
Recently observed transaction prices		4	%		2	%		2	%		1	%
Data providers/pricing services		78	%		81	%		77	%		75	%
Broker quotes		1	%		0	%		1	%		0	%
Valuation techniques		10	%		3	%		13	%		5	%
		100	%		100	%		100	%		100	%

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

	Three Months Ended February 29, 2012(3)
	Balance, November 30, 2011		Total gains/ losses (realized and unrealized) (1)			Purchases			Sales			Settlements			Net transfers into/ (out of) Level 3			Balance, February 29, 2012		Change in unrealized gains/ (losses) relating to instruments still held at February 29, 2012 (1)
Assets:
Financial instruments owned:
Corporate equity securities	$	13,489	$	1,684		$	14,184		$	—		$	—		$	912		$	30,269	$	1,685
Corporate debt securities		48,140		671			271			(22,300	)		(1,276	)		8,100			33,606		(737	)
Collateralized debt obligations		47,988		(796	)		—			(14,063	)		(3,328	)		42,775			72,576		(1,488	)
Municipal securities		6,904		(71	)		—			(740	)		—			(4,917	)		1,176		12
Sovereign obligations		140		—			—			—			—			—			140		—
Residential mortgage-backed securities		149,965		(6,492	)		10,497			(44,282	)		(6,881	)		25,944			128,751		(5,995	)
Commercial mortgage-backed securities		52,407		(1,655	)		—			(3,593	)		(44	)		(11,323	)		35,792		(1,419	)
Other asset-backed securities		3,284		(104	)		—			(197	)		(40	)		2,446			5,389		(76	)
Loans and other receivables		97,291		1,899			48,309			(21,733	)		(25,729	)		4,412			104,449		643
Investments, at fair value		78,326		1,378			480			(1,797	)		(277	)		—			78,110		1,378
Investments in managed funds		70,740		(6,212	)		8,499			(12	)		—			—			73,015		(6,212	)
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	—	$	—		$	—		$	11,511		$	—		$	—		$	11,511	$	—
Corporate debt securities		74		—			—			—			—			—			74		—
Net derivatives(2)		9,285		1,512			(295	)		—			—			(2,192	)		8,310		2,736
Loans		10,157		—			(10,157	)		—			—			—			—		—

(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.

(3) There were no issuances during the three months ended February 29, 2012.

	Three Months Ended February 28, 2011
	Balance, November 30, 2010		Total gains/ losses (realized and unrealized) (1)			Purchases, sales, settlements, and issuances			Transfers into Level 3		Transfers out of Level 3			Balance, February 28, 2011		Change in unrealized gains/ (losses) relating to instruments still held at February 28, 2011 (1)
Assets:
Financial instruments owned:
Corporate equity securities	$	22,619	$	5,167		$	6,772		$	—	$	(1,277	)	$	33,281	$	4,581
Corporate debt securities		73,408		2,283			(293	)		106		(520	)		74,984		816
Collateralized debt obligations		31,121		10,310			60,299			1,216		—			102,946		10,087
Municipal securities		472		19			308			—		—			799		19
Residential mortgage-backed securities		132,359		16,205			(64,301	)		12,886		(40	)		97,109		(2,745	)
Commercial mortgage-backed securities		6,004		222			2,804			—		(2,729	)		6,301		(824	)
Other asset-backed securities		567		(215	)		617			11,050		(567	)		11,452		(469	)
Loans and other receivables		227,596		5,974			(17,025	)		1,574		(368	)		217,751		3,021
Investments at fair value		77,784		108			(7,010	)		—		(3,048	)		67,834		626
Investments in managed funds		131,585		8,726			(3,584	)		—		—			136,727		8,350
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$	38	$	—		$	—		$	—	$	—			38	$	—
Net derivatives(2)		2,346		2,611			—			—		—			4,957		2,611
Loans		47,228		—			(29,452	)		—		—			17,776		—

(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.

Summary of (losses) due to changes in instrument specific credit risk for loans and other receivables and loan commitments measured at fair value under the fair value option

	Three Months Ended February 29, 2012
Financial Instruments Owned:
Loans and other receivables	$	7,811
Financial Instruments Sold:
Loans	$	226
Loan commitments	$	(654	)

Summary of the amount by which contractual principal exceeds fair value for loans and other receivables measured at fair value under the fair value option

	February 29, 2012		November 30, 2011
Financial Instruments Owned:
Loans and other receivables(2)	$	256,906	$	277,336
Loans greater than 90 days past due(1)(2)	$	—	$	2,253

(1) The aggregate fair value of loans that were 90 or more days past due was $0.8 million and $5.5 million at February 29, 2012 and November 30, 2011.

(2) Interest income is recognized separately from other changes in fair value and is included within Interest revenues on the Consolidated Statements of Earnings.