Investments

Our available for sale securities within our investment portfolio consisted of the following as of the dates indicated:



	June 30, 2015
(In thousands)	Amortized Cost		Fair Value		Gross Unrealized Gains		Gross Unrealized Losses
Fixed-maturities available for sale:
U.S. government and agency securities	$	5,745	$	5,784	$	39	$	—
State and municipal obligations	17,668		18,476		810		2
Corporate bonds and notes	529,942		517,857		1,850		13,935
RMBS	158,134		156,532		513		2,115
CMBS	218,531		213,988		97		4,640
Other ABS	243,096		243,045		693		744
Foreign government and agency securities	23,330		23,160		186		356
	1,196,446		1,178,842		4,188		21,792
Equity securities available for sale	573		881		308		—
Total debt and equity securities	$	1,197,019	$	1,179,723	$	4,496	$	21,792



	December 31, 2014
(In thousands)	Amortized Cost		Fair Value		Gross Unrealized Gains		Gross Unrealized Losses
Fixed-maturities available for sale:
U.S. government and agency securities	$	5,709	$	5,751	$	48	$	6
State and municipal obligations	17,727		18,910		1,183		—
Corporate bonds and notes	277,678		284,408		7,288		558
RMBS	41,467		42,520		1,053		—
CMBS	57,358		58,234		876		—
Other ABS	109,420		107,701		8		1,727
Foreign government and agency securities	19,301		19,366		307		242
	528,660		536,890		10,763		2,533
Equity securities available for sale (1)	76,900		143,368		66,468		—
Total debt and equity securities	$	605,560	$	680,258	$	77,231	$	2,533

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(1)	Comprising broadly diversified domestic equity mutual funds ($143.0 million fair value) and a preferred stock investment in Freddie Mac ($0.4 million fair value).

The trading securities within our investment portfolio, which are recorded at fair value, consisted of the following as of the dates indicated:



(In thousands)	June 30, 2015		December 31, 2014
Trading securities:
U.S. government and agency securities	$	131,335	$	134,530
State and municipal obligations	312,340		343,926
Corporate bonds and notes	660,964		708,361
RMBS	80,772		89,810
CMBS	169,443		188,615
Other ABS	30,952		77,755
Foreign government and agency securities	13,548		18,331
Equity securities	67,081		72,256
Total	$	1,466,435	$	1,633,584

For trading securities held at June 30, 2015 and December 31, 2014, we had net unrealized losses during the six months ended June 30, 2015 and unrealized gains during the year ended December 31, 2014 associated with those securities of $13.7 million and $65.7 million, respectively.

For the six months ended June 30, 2015, we did not transfer any securities from the available for sale or trading categories.

Net realized and unrealized gains (losses) on investments and other financial instruments consisted of:



	Three Months Ended June 30,						Six Months Ended June 30,
(In thousands)	2015			2014			2015			2014
Net realized gains (losses):
Fixed-maturities held to maturity	$	—		$	—		$	—		$	(9	)
Fixed-maturities available for sale	(8		)	(604		)	(59		)	(599		)
Equities available for sale	68,723			—			68,723			—
Trading securities	(8,291		)	(41		)	(12,859		)	(4,392		)
Short-term investments	4			—			4			—
Other	1			(63		)	106			(53		)
Net realized gains (losses) on investments	60,429			(708		)	55,915			(5,053		)
Unrealized (losses) gains on trading securities	(31,638		)	28,941			(10,937		)	76,572
Total net gains on investments	28,791			28,233			44,978			71,519
Net (losses) gains on other financial instruments	(343		)	(2,901		)	249			(3,219		)
Net gains on investments and other financial instruments	$	28,448		$	25,332		$	45,227		$	68,300

The following tables show the gross unrealized losses and fair value of our securities deemed “available for sale” aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of the dates indicated:



June 30, 2015: ($ in thousands) Description of Securities	Less Than 12 Months					12 Months or Greater					Total
June 30, 2015: ($ in thousands) Description of Securities	# of securities	Fair Value		Unrealized Losses		# of securities	Fair Value		Unrealized Losses		# of securities	Fair Value		Unrealized Losses
State and municipal obligations	1	$	5,727	$	2	—	$	—	$	—	1	$	5,727	$	2
Corporate bonds and notes	95	408,203		13,528		7	10,172		407		102	418,375		13,935
RMBS	9	116,631		2,115		—	—		—		9	116,631		2,115
CMBS	30	195,913		4,640		—	—		—		30	195,913		4,640
Other ABS	28	114,059		273		10	39,860		471		38	153,919		744
Foreign government and agency securities	11	10,971		340		1	183		16		12	11,154		356
Total	174	$	851,504	$	20,898	18	$	50,215	$	894	192	$	901,719	$	21,792



December 31, 2014: ($ in thousands) Description of Securities	Less Than 12 Months					12 Months or Greater					Total
	# of securities	Fair Value		Unrealized Losses		# of securities	Fair Value		Unrealized Losses		# of securities	Fair Value		Unrealized Losses
U.S. government and agency securities	—	$	—	$	—	1	$	3,455	$	6	1	$	3,455	$	6
Corporate bonds and notes	24	40,917		410		1	1,027		148		25	41,944		558
Other ABS	34	97,356		1,727		—	—		—		34	97,356		1,727
Foreign government and agency securities	4	6,353		242		—	—		—		4	6,353		242
Total	62	$	144,626	$	2,379	2	$	4,482	$	154	64	$	149,108	$	2,533

During the first six months of 2015 and 2014, we did not recognize in earnings any impairment losses related to credit deterioration.

Although we held securities in an unrealized loss position as of June 30, 2015, we did not consider them to be other-than-temporarily impaired as of such date. For all investment categories, the unrealized losses of 12 months or greater duration as of June 30, 2015, were generally caused by interest rate or credit spread movements since the purchase date. As of June 30, 2015, we estimated that the present value of cash flows expected to be collected from these securities would be sufficient to recover the amortized cost basis of these securities. As of June 30, 2015, we did not have the intent to sell any debt securities in an unrealized loss position, and we determined that it is more likely than not that we will not be required to sell the securities before recovery of their cost basis, which may be at maturity; therefore, we did not consider these investments to be other-than-temporarily impaired at June 30, 2015.

The contractual maturities of fixed-maturity investments are as follows:



	June 30, 2015
	Available for Sale
(In thousands)	Amortized Cost		Fair Value
Due in one year or less (1)	$	7,381	$	7,399
Due after one year through five years (1)	51,208		51,265
Due after five years through ten years (1)	345,233		340,126
Due after ten years (1)	172,863		166,487
RMBS (2)	158,134		156,532
CMBS (2)	218,531		213,988
Other ABS (2)	243,096		243,045
Total	$	1,196,446	$	1,178,842

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(1)	Actual maturities may differ as a result of calls before scheduled maturity.


(2)	RMBS, CMBS, and Other ABS are shown separately, as they are not due at a single maturity date.

At June 30, 2015 and December 31, 2014, Radian Guaranty had $210.3 million and $209.3 million, respectively, in a collateral account pursuant to the Freddie Mac Agreement. These investments, which are primarily invested in trading securities, are pledged to cover Loss Mitigation Activity on the loans subject to that agreement. Subject to certain conditions in the Freddie Mac Agreement, amounts in the collateral account may be released to Radian Guaranty over time to the extent that Loss Mitigation Activity becomes final in accordance with the terms of the Freddie Mac Agreement. However, if the amount of Loss Mitigation Activity that becomes final in accordance with the Freddie Mac Agreement is less than $205 million prior to August 29, 2017, then any shortfall will be paid on that date to Freddie Mac from the funds remaining in the collateral account, subject to certain adjustments designed to allow for any Loss Mitigation Activity that has not become final or any claims evaluation that has not been completed as of that date. From the time the collateral account was established through June 30, 2015, approximately $128 million of Loss Mitigation Activity had become final in accordance with the Freddie Mac Agreement and approximately $13 million of submitted claims had been rescinded, denied, curtailed or cancelled, but were not yet considered final in accordance with the Freddie Mac Agreement.