Financial Instruments

9 Months Ended

Sep. 30, 2018

5. Financial Instruments

The Company elected to invest a portion of its cash assets in conservative, income earning, and liquid investments. Cash equivalents and investments, all of which are classified as available-for-sale securities, consisted of the following:


	September 30, 2018								December 31, 2017
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Estimated Fair Value		Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Estimated Fair Value
	(in thousands)
Money market deposits	$	17,880	$	—	$	—	$	17,880	$	3,477	$	—	$	—	$	3,477
U.S. Treasury securities		101,087		—		(619)		100,468		67,480		10		(464)		67,026
U.S. agency securities		19,029		—		(180)		18,849		27,293		—		(221)		27,072
Municipal securities		11,669		—		(95)		11,574		12,240		—		(91)		12,149
Total	$	149,665	$	—	$	(894)	$	148,771	$	110,490	$	10	$	(776)	$	109,724

Classified as:
Cash equivalents							$	17,880							$	3,477
Short-term investments								130,891								106,247
Total							$	148,771							$	109,724

The Company invests in U.S. Treasuries, U.S. agency and high quality municipal bonds which mature at par value and are all paying their coupons on schedule. The Company has therefore concluded there is currently no other than temporary impairment of its investments and will continue to recognize unrealized gains and losses in other comprehensive income (loss). During the three and nine months ended September 30, 2018 and 2017, the amount of gross realized gains and realized losses upon sales of investments were insignificant. The Company uses the specific investment identification method to calculate realized gains and losses and amounts reclassified out of other comprehensive income to net income. As of September 30, 2018, the Company had 22 investments in an unrealized loss position in its portfolio.

The following table summarizes the Company’s portfolio of available-for-sale securities by contractual maturity as of September 30, 2018:


	September 30, 2018
	Amortized Cost		Fair Value
	(in thousands)
Less than one year	$	89,375	$	89,188
Greater than one year but less than five years		42,410		41,703
Total	$	131,785	$	130,891