FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Dec. 31, 2017

Dec. 31, 2016

Schedule of Trading Securities and Other Trading Assets [Line Items]

Fair Value Measurements, Recurring and Nonrecurring

The following table presents the Company’s investments, categorized by the level of the fair value hierarchy as of December 31, 2017:



	Fair value measurements as of December 31, 2017
Description	Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)		Total
	($ in thousands)
Assets:
Debt instruments	$	—		$	6,300		$	880	$	7,180
Listed equity securities	1,181,150			22,522			—		1,203,672
Commodities	121,502			—			—		121,502
Private and unlisted equity securities	—			—			6,108		6,108
	$	1,302,652		$	28,822		$	6,988	$	1,338,462
Unlisted equity funds measured at net asset value⁽¹⁾									24,522
Total investments									$	1,362,984
Financial contracts receivable	$	22		$	12,871		$	—	$	12,893

Liabilities:
Listed equity securities, sold not yet purchased	$	(812,652	)	$	—		—		$	(812,652	)
Debt instruments, sold not yet purchased	—			(100,145		)	—		(100,145		)
Total securities sold, not yet purchased	$	(812,652	)	$	(100,145	)	—		$	(912,797	)
Financial contracts payable	$	—		$	(22,222	)	—		$	(22,222	)

⁽¹⁾ Investments measured at fair value using the net asset value practical expedient have not been classified in the fair value hierarchy. The fair value amounts are presented in the above table to facilitate reconciliation to the consolidated balance sheets.

The following table presents the Company’s investments, categorized by the level of the fair value hierarchy as of December 31, 2016:



	Fair value measurements as of December 31, 2016
Description	Quoted prices in active markets (Level 1)			Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)		Total
	($ in thousands)
Assets:
Debt instruments	$	—		$	21,819		$	654	$	22,473
Listed equity securities	823,421			20,580			—		844,001
Commodities	137,296			—			—		137,296
Private and unlisted equity securities	—			—			6,109		6,109
	$	960,717		$	42,399		$	6,763	$	1,009,879
Unlisted equity funds measured at net asset value ⁽¹⁾									12,658
Total investments									$	1,022,537
Financial contracts receivable	$	20		$	76,361		$	—	$	76,381

Liabilities:
Listed equity securities, sold not yet purchased	$	(770,267	)	$	—		$	—	$	(770,267	)
Debt instruments, sold not yet purchased	—			(89,635		)	—		(89,635		)
Total securities sold, not yet purchased	$	(770,267	)	$	(89,635	)	$	—	$	(859,902	)
Financial contracts payable	$	—		$	(2,237	)	$	—	$	(2,237	)

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The following table presents the reconciliation of the balances for all investments measured at fair value using significant unobservable inputs (Level 3) for the year ended December 31, 2017:



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Year ended December 31, 2017
	Assets
	Debt instruments		Private and unlisted equity securities			Total
	($ in thousands)
Beginning balance	$	654	$	6,109		$	6,763
Purchases	—		1,750			1,750
Sales	—		—			—
Total realized and unrealized gains (losses) and amortization included in earnings, net	226		17			243
Transfers into Level 3	—		—			—
Transfers out of Level 3	—		(1,768		)	(1,768		)
Ending balance	$	880	$	6,108		$	6,988

The following table presents the reconciliation of the balances for all investments measured at fair value using significant unobservable inputs (Level 3) for the year ended December 31, 2016:



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Year ended December 31, 2016
	Assets
	Debt instruments		Private and unlisted equity securities			Total
	($ in thousands)
Beginning balance	$	505	$	8,452		$	8,957
Purchases	—		—			—
Sales	—		(2,539		)	(2,539		)
Total realized and unrealized gains (losses) and amortization included in earnings, net	149		196			345
Transfers into Level 3	—		—			—
Transfers out of Level 3	—		—			—
Ending balance	$	654	$	6,109		$	6,763

Investments Classified by Contractual Maturity Date

The maturity distribution for debt instruments held at December 31, 2017 and 2016, was as follows:



	2017				2016
	Cost/ amortized cost		Fair value		Cost/ amortized cost		Fair value
	($ in thousands)
Within one year	$	7,557	$	441	$	—	$	—
From one to five years	—		—		17,803		19,492
From five to ten years	2,109		52		4,649		2,327
More than ten years	6,782		6,687		951		654
	$	16,448	$	7,180	$	23,403	$	22,473

Investment Holdings, Other than Securities

At December 31, 2017, the following securities were included in other investments:



	Cost		Unrealized gains		Unrealized losses		Fair value
	($ in thousands)
Commodities	$	101,184	$	20,318	$	—	$	121,502
Private and unlisted equity funds	25,316		5,314		—		30,630
	$	126,500	$	25,632	$	—	$	152,132

At December 31, 2016, the following securities were included in other investments:



	Cost		Unrealized gains		Unrealized losses			Fair value
	($ in thousands)
Commodities	$	130,671	$	6,625	$	—		$	137,296
Private and unlisted equity funds	14,418		4,375		(26		)	18,767
	$	145,089	$	11,000	$	(26	)	$	156,063

Investments Sold, Not yet Purchased

At December 31, 2017, the following securities were included in investments in securities sold, not yet purchased:



	Proceeds			Unrealized gains		Unrealized losses			Fair value
	($ in thousands)
Equities – listed	$	(643,148	)	$	17,541	$	(187,045	)	$	(812,652	)
Sovereign debt – Non U.S.	(96,231		)	—		(3,914		)	(100,145		)
	$	(739,379	)	$	17,541	$	(190,959	)	$	(912,797	)

At December 31, 2016, the following securities were included in investments in securities sold, not yet purchased:



	Proceeds			Unrealized gains		Unrealized losses			Fair value
	($ in thousands)
Equities – listed	$	(690,270	)	$	30,768	$	(110,765	)	$	(770,267	)
Sovereign debt – Non U.S.	(96,230		)	6,595		—			(89,635		)
	$	(786,500	)	$	37,363	$	(110,765	)	$	(859,902	)

Fair Values of Financial Contracts Outstanding

At December 31, 2017, the fair values of financial contracts outstanding were as follows:



Financial Contracts	Listing currency⁽¹⁾	Notional amount of underlying instruments	Fair value of net assets (obligations) on financial contracts
		($ in thousands)
Financial contracts receivable
Call options	USD	2,656	$	91
Commodity Swaps	USD	17,833	2,142
Forwards	KRW	41,379	801
Futures	USD	5,874	12
Interest rate swaps	JPY	21,269	479
Put options ⁽²⁾	USD	155	1
Total return swaps – equities	EUR/GBP/USD	34,965	9,357
Warrants and rights on listed equities	EUR/USD	29	10
Total financial contracts receivable, at fair value			$	12,893
Financial contracts payable
Commodity Swaps	USD	26,795	$	(353	)
Put options	USD	130	(14		)
Total return swaps – equities	EUR/GBP/KRW/RON/USD	60,663	(21,855		)
Total financial contracts payable, at fair value			$	(22,222	)

⁽¹⁾USD = US Dollar; EUR = Euro; GBP = British Pound; JPY = Japanese Yen; KRW = Korean Won; RON = Romanian New Leu.

⁽²⁾ Includes options on the Chinese Yuan, denominated in U.S. dollars.

At December 31, 2016, the fair values of financial contracts outstanding were as follows:



Financial Contracts	Listing currency ⁽¹⁾	Notional amount of underlying instruments	Fair value of net assets (obligations) on financial contracts
		($ in thousands)
Financial contracts receivable
Call options	USD	134,495	$	26,508
Commodity Swaps	USD	82,009	13,506
Interest rate swaps	JPY	20,490	218
Put options ⁽²⁾	USD	115,481	6,703
Total return swaps – equities	EUR/GBP/USD	100,199	29,413
Warrants and rights on listed equities	EUR/USD	67	33
Total financial contracts receivable, at fair value			$	76,381
Financial contracts payable
Forwards	KRW	6,880	(118		)
Put options	USD	815	(172		)
Total return swaps – equities	EUR/GBP/KRW/RON/USD	31,257	(1,947		)
Total financial contracts payable, at fair value			$	(2,237	)

⁽¹⁾ USD = US Dollar; EUR = Euro; GBP = British Pound; JPY = Japanese Yen; KRW = Korean Won; RON = Romanian New Leu.

⁽²⁾ Includes options on the Japanese Yen and the Chinese Yuan, denominated in U.S. dollars.

Gains and losses on derivatives recognized in income

During the years ended December 31, 2017, 2016 and 2015, the Company reported gains and losses on derivatives as follows:



Derivatives not designated as hedging instruments	Location of gains and losses on derivatives recognized in income	Gain (loss) on derivatives recognized in income
		Year ended December 31
		2017			2016			2015
		($ in thousands)
Commodity swaps	Net investment income (loss)	$	(9,293	)	$	10,474		$	(12,061	)
Credit default swaps, purchased – corporate debt	Net investment income (loss)	—			—			(156		)
Credit default swaps, purchased – sovereign debt	Net investment income (loss)	—			—			(90		)
Forwards	Net investment income (loss)	2,507			(302		)	1,009
Futures	Net investment income (loss)	(399		)	376			(952		)
Interest rate swaps	Net investment income (loss)	136			218			(706		)
Options, warrants, and rights	Net investment income (loss)	(18,455		)	10,261			(13,955		)
Total return swaps – equities	Net investment income (loss)	2,281			28,612			(12,590		)
Weather derivative swap	Other income (expense), net	—			—			(2,340		)
Total		$	(23,223	)	$	49,639		$	(41,841	)

Derivatives volume of activities based on notional amounts

For the year ended December 31, 2017, the Company’s volume of derivative activities (based on notional amounts) was as follows:



	Year ended December 31, 2017
Derivatives not designated as hedging instruments (notional amounts)	Entered		Exited
	($ in thousands)
Commodity swaps	$	2,025	$	41,830
Forwards	34,652		1,739
Futures	38,207		32,537
Options, warrants and rights ⁽¹⁾	950,811		133,407
Total return swaps	258,874		355,446
Total	$	1,284,569	$	564,959

⁽¹⁾Exited amount excludes derivatives which expired or were exercised during the period.

For the year ended December 31, 2016, the Company’s volume of derivative activities (based on notional amounts) was as follows:



	Year ended December 31, 2016
Derivatives not designated as hedging instruments (notional amounts)	Entered		Exited
	($ in thousands)
Commodity swaps	$	141,534	$	100,045
Forwards	6,880		3,128
Futures	1,966,368		1,988,782
Interest rate swaps	20,490		—
Options, warrants and rights⁽¹⁾	462,429		366,285
Total return swaps	86,688		59,810
Total	$	2,684,389	$	2,518,050

⁽¹⁾ Exited amount excludes derivatives which expired or were exercised during the period.

Offsetting derivative assets and liabilities

As of December 31, 2017, the gross and net amounts of derivative instruments and the cash collateral applicable to derivative instruments were as follows:



December 31, 2017	(i)			(ii)		(iii) = (i) - (ii)			(iv) Gross amounts not offset in the balance sheet						(v) = (iii) + (iv)
Description	Gross amounts of recognized assets (liabilities)			Gross amounts offset in the balance sheet		Net amounts of assets (liabilities) presented in the balance sheet			Financial instruments available for offset			Cash collateral (received) pledged			Net amount of asset (liability)
	($ in thousands)
Financial contracts receivable	$	12,893		$	—	$	12,893		$	(5,128	)	$	(1,336	)	$	6,429
Financial contracts payable	(22,222		)	—		(22,222		)	5,128			17,094			—

As of December 31, 2016, the gross and net amounts of derivative instruments and the cash collateral applicable to derivative instruments were as follows:



December 31, 2016	(i)			(ii)		(iii) = (i) - (ii)			(iv) Gross amounts not offset in the balance sheet						(v) = (iii) + (iv)
Description	Gross amounts of recognized assets (liabilities)			Gross amounts offset in the balance sheet		Net amounts of assets (liabilities) presented in the balance sheet			Financial instruments available for offset			Cash collateral (received) pledged			Net amount of asset (liability)
	($ in thousands)
Financial contracts receivable	$	76,381		$	—	$	76,381		$	(938	)	$	(44,572	)	$	30,871
Financial contracts payable	(2,237		)	—		(2,237		)	938			1,299			—

Equities – listed

Schedule of Trading Securities and Other Trading Assets [Line Items]

Trading Securities (and Certain Trading Assets)

At December 31, 2017, the following long positions were included in equity securities, trading:



	Cost		Unrealized gains		Unrealized losses			Fair value
	($ in thousands)
Equities – listed	$	1,014,426	$	208,350	$	(19,104	)	$	1,203,672
Total equity securities	$	1,014,426	$	208,350	$	(19,104	)	$	1,203,672

At December 31, 2016, the following long positions were included in equity securities, trading:



	Cost		Unrealized gains		Unrealized losses			Fair value
	($ in thousands)
Equities – listed	$	753,813	$	115,379	$	(40,706	)	$	828,486
Exchange traded funds	15,056		459		—			15,515
Total equity securities	$	768,869	$	115,838	$	(40,706	)	$	844,001

Debt instruments

Schedule of Trading Securities and Other Trading Assets [Line Items]

Trading Securities (and Certain Trading Assets)

At December 31, 2017, the following investments were included in debt instruments:



	Cost/ amortized cost		Unrealized gains		Unrealized losses			Fair value
	($ in thousands)
Corporate debt – U.S.	$	8,508	$	—	$	(7,186	)	$	1,322
Corporate debt – Non U.S.	2,109		—		(2,057		)	52
Sovereign debt – Non U.S.	5,831		—		(25		)	5,806
Total debt instruments	$	16,448	$	—	$	(9,268	)	$	7,180

At December 31, 2016, the following investments were included in debt instruments:



	Cost/ amortized cost		Unrealized gains		Unrealized losses			Fair value
	($ in thousands)
Corporate debt – U.S.	$	21,294	$	6,509	$	(5,331	)	$	22,472
Corporate debt – Non U.S.	2,109		—		(2,108		)	1
Total debt instruments	$	23,403	$	6,509	$	(7,439	)	$	22,473