Investment Securities and Certificates of Deposit

3 Months Ended

Mar. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Investment Securities and Certificates of Deposit

The Company's Investment Securities and Certificates of Deposit as of March 31, 2020 and December 31, 2019 were as follows:



	March 31, 2020								December 31, 2019
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Debt Securities	$	13,060	$	101	$	42	$	13,119	$	114,204	$	591	$	11	$	114,784
Equity Securities	666		—		502		164		666		—		168		498
Debt Securities Carried by Broker-Dealers	199,222		1,216		1,282		199,156		225,727		1,648		20		227,355
Investment Funds	58,257		—		9,036		49,221		58,704		7,809		—		66,513
Total Investment Securities (carried at fair value)	$	271,205	$	1,317	$	10,862	$	261,660	$	399,301	$	10,048	$	199	$	409,150

Certificates of Deposit (carried at contract value)							—								214,796

Total Investment Securities and Certificates of Deposit							$	261,660							$	623,946

Scheduled maturities of the Company's available-for-sale debt securities as of March 31, 2020 and December 31, 2019 were as follows:



	March 31, 2020				December 31, 2019
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due within one year	$	4,951	$	4,981	$	108,662	$	109,217
Due after one year through five years	7,100		7,130		5,542		5,567
Due after 10 years	1,009		1,008		—		—
Total	$	13,060	$	13,119	$	114,204	$	114,784

Since the Company has the ability and intent to hold available-for-sale securities until a recovery of fair value is equal to an amount approximating its amortized cost, which may be at maturity, the securities are either U.S. Treasuries or municipal bonds, primarily with S&P ratings ranging from AAA to BB+, and the Company has not incurred credit losses on its securities, it does not consider such unrealized loss positions to be impaired at March 31, 2020, and as such, has not recorded a credit allowance on these securities.

Debt Securities

Debt Securities are classified as available-for-sale securities within Investment Securities on the Unaudited Condensed Consolidated Statements of Financial Condition. These securities are stated at fair value with unrealized gains and losses included in Accumulated Other Comprehensive Income (Loss) and realized gains and losses included in earnings. The Company had net realized losses of ($4) and ($3) for the three months ended March 31, 2020 and 2019, respectively.

Equity Securities

Equity Securities are carried at fair value with changes in fair value recorded in Other Revenue, Including Interest and Investments, on the Unaudited Condensed Consolidated Statements of Operations. The Company had net realized and unrealized gains (losses) of ($334) and $152 for the three months ended March 31, 2020 and 2019, respectively.

Debt Securities Carried by Broker-Dealers

EGL and other broker-dealers invest in fixed income portfolios consisting primarily of U.S. Treasury bills, municipal bonds and other debt securities. These securities are carried at fair value, with changes in fair value recorded in Other Revenue, Including Interest and Investments, on the Unaudited Condensed Consolidated Statements of Operations, as required for broker-dealers in securities. The Company had net realized and unrealized gains (losses) of ($634) and $49 for the three months ended March 31, 2020 and 2019, respectively.

Investment Funds

The Company invests in a portfolio of exchange-traded funds and mutual funds as an economic hedge against the Company's deferred cash compensation program. See Note 16 for further information. These securities are carried at fair value, with changes in fair value recorded in Other Revenue, Including Interest and Investments, on the Unaudited Condensed Consolidated Statements of Operations. The Company had net realized and unrealized gains (losses) of ($13,019) and $6,587 for the three months ended March 31, 2020 and 2019, respectively.

In February 2020, the Company entered into four month futures contracts on a stock index fund with a notional amount of $38,908, as an economic hedge against the Company's deferred cash compensation program. See Note 17 for further information.

Certificates of Deposit

At December 31, 2019, the Company held certificates of deposit of $214,796 with certain banks with original maturities of six months or less when purchased. These certificates of deposit matured in January 2020.