Investments

9 Months Ended

Sep. 30, 2020

Investments, Debt and Equity Securities [Abstract]

The following table presents the details of our investments:


	September 30, 2020		December 31, 2019
	(in millions)
Financial investments	$	177	$	291



Equity method investments	$	243	$	156
Equity securities	$	53	$	49

Financial Investments

As of September 30, 2020, financial investments are comprised of trading securities, and are primarily comprised of highly rated European government debt securities, Swedish mortgage bonds and highly rated corporate debt, of which $157 million are assets primarily utilized to meet regulatory capital requirements, mainly for our clearing operations at Nasdaq Clearing. As of December 31, 2019, financial investments are comprised of trading securities, and are primarily comprised of highly rated European government debt securities, time deposits and highly rated corporate debt, of which $169 million are assets primarily utilized to meet regulatory capital requirements, mainly for our clearing operations at Nasdaq Clearing.

Equity Method Investments

We record our estimated pro-rata share of earnings or losses each period based on the most recent financial information made available to us and record any dividends as a reduction in the investment balance. As of September 30, 2020 and 2019, our equity method investments primarily included our 40.0% equity interest in OCC.

The carrying amounts of our equity method investments are included in other non-current assets in the Condensed Consolidated Balance Sheets. No material impairments were recorded to reduce the carrying value of our equity method investments for the three and nine months ended September 30, 2020 and 2019.

Net income recognized from our equity interest in the earnings and losses of these equity method investments was $54 million for the three months ended September 30, 2020, $15 million for the three months ended September 30, 2019, $97 million for the nine months ended September 30, 2020, and $71 million for the nine months ended September 30, 2019. For the three and nine months ended September 30, 2020, net income recognized included higher earnings from our OCC ownership interest as a result of high U.S. industry trading volumes. The higher earnings for the first nine months of 2019 is discussed in the following paragraph.

In February 2019, the SEC disapproved the OCC capital plan that had been established in 2015. Following the SEC disapproval, the OCC suspended customer rebates and dividends to owners, including the unpaid dividend on 2018

results. We were not able to determine the impact of the disapproval of the OCC capital plan on OCC's 2018 net income until March 2019, when OCC's 2018 financial statements were made available to us. As a result, during the first quarter of 2019, we recognized an additional $36 million of income relating to our share of OCC's net income for the year ended December 31, 2018, which is included in the $71 million for the nine months ended September 30, 2019.

Equity Securities

The carrying amounts of our equity securities are included in other non-current assets in the Condensed Consolidated Balance Sheets. We elected the measurement alternative for primarily all of our equity securities as they do not have a readily determinable fair value. No material adjustments were made to the carrying value of our equity securities for the three and nine months ended September 30, 2020 and 2019. As of September 30, 2020 and December 31, 2019, our equity securities represent various strategic investments made through our corporate venture program as well as investments acquired through various acquisitions.