7. Investments

The Company earns income on cash balances and investments, as well as on premium trust balances that the Company maintains for premiums collected from insureds but not yet remitted to insurance companies, and funds held under the terms of certain outsourcing agreements to pay certain obligations on behalf of clients. Premium trust balances and a corresponding liability are included in Fiduciary assets and Fiduciary liabilities in the accompanying Consolidated Statements of Financial Position.

The Company's interest-bearing assets and other investments are included in the following categories in the Consolidated Statements of Financial Position (in millions):

As of December 31	2012		2011


Cash and cash equivalents	$	291	$	272
Short-term investments		346		785
Fiduciary assets (1)		4,029		4,190
Investments		165		239

	$	4,831	$	5,486

(1): Fiduciary assets include funds held on behalf of clients but does not include fiduciary receivables.

The Company's investments are as follows (in millions):

As of December 31	2012		2011


Equity method investments (2)	$	102	$	164
Other investments, at cost		43		60
Fixed-maturity securities		20		15

	$	165	$	239

(2): The reduction in equity method investments is primarily due to redemptions.