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ASSETS MEASURED AT FAIR VALUE

6 Months Ended

Jun. 30, 2024

12. ASSETS MEASURED AT FAIR VALUE

Financial assets measured at fair value on a recurring basis are summarized below and disclosed on the condensed consolidated balance sheet as of June 30, 2024 and December 31, 2023:

	Fair Value Measurement Using						Amount at
	Level 1		Level 2		Level 3		Fair Value
June 30, 2024
Assets
Investment Securities- Fair Value Option	$	5,401,855	$	1,468,357	$	-	$	6,870,212
Investment Securities- Trading		1,085,361		2,309,665		-		3,395,026
Warrants – NECV		-		-		973		973
Warrants - VEII		-		1,833,979		-		1,833,979
Warrants - SHRG		-		137,500		-		137,500
Convertible Loan Receivable - VEII		-		483,457		-		483,457
Convertible Loan Receivable - SHRG		-		1,137,200		-		1,137,200

Total Assets at Fair Value	$	6,487,216	$	7,370,158	$	973	$	13,858,347

	Fair Value Measurement Using						Amount at
	Level 1		Level 2		Level 3		Fair Value
December 31, 2023
Assets
Investment Securities- Fair Value Option	$	7,537,472	$	2,100,720	$	-	$	9,638,192
Investment Securities- Trading		35,036		1,779,601		-		1,814,637
Convertible Note Receivable		-		-		77,307		77,307
Warrants - NECV		-		-		430		430
Warrants- VEII		-		2,487,854		-		2,487,854
Convertible Loan Receivable - VEII		-		1,207,627		-		1,207,627

Total Assets at Fair Value	$	7,572,508	$	7,575,802	$	77,737	$	15,226,047

Realized loss on investment securities for the three months ended June 30, 2024 was $192,205 and realized loss on investment securities for the three months ended June 30, 2023 was $10,557,229. Realized loss on investment securities for the six months ended June 30, 2024 was $344,673 and realized loss on investment securities for the six months ended June 30, 2023 was $10,688,542. Unrealized gain on securities investment was $1,676,711 and $18,840,726 in the three months ended June 30, 2024 and 2023, respectively. Unrealized loss on securities investment was $3,589,106 and $17,652,880 gain in the six months ended June 30, 2024 and 2023, respectively. These gains and losses were recorded directly to net loss.

For U.S. trading stocks, we use Bloomberg Market stock prices as the share prices to calculate fair value. For overseas stock, we use the stock price from the local stock exchange to calculate fair value. The following chart shows details of the fair value of equity security investment at June 30, 2024 and December 31, 2023, respectively.

	Share price				Market Value
	6/30/2024		Shares		6/30/2024		Valuation

DSS (Related Party)	$	1.720		3,140,613	$	5,401,855	Investment in Securities at Fair Value – Related Party

Trading Stocks					$	1,085,361	Investment in Securities at Fair Value

		Total Level 1 Equity Securities			$	6,487,216

AMBS	$	0.000		20,000,000	$	2,000	Investment in Securities at Fair Value

Holista	$	0.003		36,199,845	$	120,739	Investment in Securities at Fair Value

Value Exchange (Related Party)	$	0.050		21,179,275	$	1,058,964	Investment in Securities at Fair Value – Related Party

New Electric CV (Related Party)	$	0.000		354,039,000	$	35,404	Investment in Securities at Fair Value – Related Party

Sharing Services (Related Party)	$	0.002		125,624,528	$	251,250	Investment in Securities at Fair Value – Related Party

Trading Stocks					$	2,309,665	Investment in Securities at Fair Value

		Total Level 2 Equity Securities			$	3,778,022

Nervotec		N/A		1,666	$	36,868	Investment in Securities at Cost
UBeauty		N/A		3,600	$	16,637	Investment in Securities at Cost
Ideal Food and Beverages		N/A		19,000	$	14,010	Investment in Securities at Cost
		Total Equity Securities			$	10,332,753

	Share price				Market Value
	12/31/2023		Shares		12/31/2023		Valuation

DSS (Related Party)	$	0.120		62,812,264	$	7,537,472	Investment in Securities at Fair Value – Related Party

Trading Stocks					$	35,036	Investment in Securities at Fair Value

		Total Level 1 Equity Securities			$	7,572,508

AMBS	$	0.001		20,000,000	$	10,000	Investment in Securities at Fair Value

Holista	$	0.007		36,159,845	$	246,556	Investment in Securities at Fair Value

Value Exchange (Related Party)	$	0.067		21,179,275	$	1,429,602	Investment in Securities at Fair Value – Related Party

Sharing Services (Related Party)	$	0.003		125,624,528	$	414,562	Investment in Securities at Fair Value – Related Party

New Electric CV (Related Party)	$	0.000		354,039,000	$	-	Investment in Securities at Fair Value – Related Party

Trading Stocks					$	1,779,601	Investment in Securities at Fair Value

		Total Level 2 Equity Securities			$	3,880,321

Nervotec		N/A		1,666	$	37,876	Investment in Securities at Cost
UBeauty		N/A		3,600	$	16,636	Investment in Securities at Cost
		Total Equity Securities			$	11,507,341

Changes in the observable input values would likely cause material changes in the fair value of the Company’s Level 3 financial instruments. A significant increase (decrease) in this likelihood would result in a higher (lower) fair value measurement.

The table below provides a summary of the changes in fair value which are recorded as other comprehensive income (loss), including net transfers in and/or out of all financial assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the six months ended June 30, 2024 and 2023:

	Total
Balance at January 1, 2024	$	77,737
Impairment		(77,307	)
Total Gains		543

Balance at March 31, 2024	$	973
Total Gains		-
Balance at June 30, 2024	$	973

	Total
Balance at January 1, 2023	$	416,164
Total gains		62,348
Balance at March 31, 2023	$	478,512
Total Losses		(342,798	)
Net gains (losses)
Balance at June 30, 2023	$	135,714

Vector Com Convertible Bond

On February 26, 2021, the Company invested approximately $88,599 in the convertible note of Vector Com Co., Ltd (“Vector Com”), a private company in South Korea. The interest rate is 2% per annum. The conversion price is approximately $21.26 per common share of Vector Com. As of December 31, 2023, the Management estimated the fair value of the note to be $88,599. The Company wrote off this loan at March 31, 2024

Warrants

NECV

On July 17, 2020, the Company purchased 122,039,000 shares, approximately 9.99% ownership, and 1,220,390,000 warrants with an exercise price of $0.0001 per share, from NECV, for an aggregated purchase price of $122,039. During 2021, the Company exercised 232,000,000 of the warrants to purchase 232,000,000 shares of NECV for the total consideration of $232,000, leaving the balance of outstanding warrants of 988,390,000 at December 31, 2022. The Company did not exercise any warrants during six months ended June 30, 2024 and the year ended December 31, 2023. We value NECV warrants under level 3 category through a Black Scholes option pricing model and the fair value of the warrants from NECV was $973 as of June 30, 2024 and $430 as of December 31, 2023.

The fair value of the NECV warrants under level 3 category as of June 30, 2024 and December 31, 2023 was calculated using a Black-Scholes valuation model valued with the following weighted average assumptions:

	June 30, 2024			December 31, 2023

Stock Price	$	0.0001		$	0.0001
Exercise price	$	0.001		$	0.001
Risk free interest rate		4.62	%		4.62	%
Annualized volatility		869.4	%		869.4	%
Dividend Yield	$	0.00		$	0.00
Year to maturity		6.06			6.56

VEII

On September 6, 2023, the Company received warrants to purchase shares of VEII, a related party listed company. For further details on this transaction, refer to Note 7 - Related Party Transactions, Note Receivable from a Related Party Company. As of June 30, 2024 and December 31, 2023, the fair value of the warrants was $1,833,979 and $2,487,854, respectively. The Company did not exercise any warrants during the six months June 30, 2024 and the year ended December 31, 2023.

The fair value of the VEII warrants under level 2 category as of June 30, 2024, and December 31, 2023 was calculated using a Black-Scholes valuation model valued with the following weighted average assumptions:

	June 30, 2024			December 31, 2023

Stock price	$	0.0500		$	0.0677
Exercise price	$	0.1770		$	0.1770
Risk free interest rate		8.50	%		8.50	%
Annualized volatility		329.13	%		275.85	%
Dividend Yield	$	0.00		$	0.00
Year to maturity		4.18			4.68

SHRG

On March 20, 2024, HWH International Inc., entered into a securities purchase agreement with SHRG, pursuant to which HWH purchased from SHRG a (i) Convertible Promissory Note in the amount of $250,000, convertible into 208,333,333 shares of SHRG’s common stock at the option of HWH, and (ii) certain warrants exercisable into 208,333,333 shares of SHRG’s common stock at an exercise price of $0.0012 per share, the exercise period of the warrant being five (5) years from the date of the securities purchase agreement, for an aggregate purchase price of $250,000. At the time of this filing, HWH has not converted any of the debt contemplated by the Convertible Note nor exercised any of the warrants. As of June 30, 2024, the fair value of the warrants was $137,500.

The fair value of the SHRG warrants under level 2 category as of June 30, 2024, was calculated using binomial option pricing model valued with the following weighted average assumptions:

	June 30, 2024

Stock price	$	0.0020
Exercise price	$	0.0012
Risk free interest rate		4.40	%
Annualized volatility		141.48	%
Dividend Yield	$	0.00
Year to maturity		4.71

Convertible Loan Receivables

The Company has elected to recognize the convertible loan receivables at fair value and therefore there was no further evaluation of embedded features for bifurcation. The Company engaged third party valuation firm to perform the valuation of convertible loans. The fair value of the convertible loans is calculated using the binomial tree model based on probability of remaining as straight debt using discounted cash flow.