Investments

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



	September 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	$	5,764	$	5,793	$	29	$	—
State and municipal obligations	17,581		18,576		995		—
Corporate bonds and notes	614,635		606,260		3,753		12,128
RMBS	208,011		209,028		1,377		360
CMBS	307,216		305,700		1,533		3,049
Other ABS	330,986		328,746		1,088		3,328
Foreign government and agency securities	23,329		22,225		102		1,206
	1,507,522		1,496,328		8,877		20,071
Equity securities available for sale	573		985		412		—
Total debt and equity securities	$	1,508,095	$	1,497,313	$	9,289	$	20,071



	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)	September 30, 2015		December 31, 2014
Trading securities:
U.S. government and agency securities	$	131,956	$	134,530
State and municipal obligations	313,884		343,926
Corporate bonds and notes	632,681		708,361
RMBS	76,536		89,810
CMBS	156,697		188,615
Other ABS	25,559		77,755
Foreign government and agency securities	13,449		18,331
Equity securities	63,995		72,256
Total	$	1,414,757	$	1,633,584

For trading securities held at September 30, 2015 and December 31, 2014, we had net unrealized losses during the nine months ended September 30, 2015 and net unrealized gains during the year ended December 31, 2014 associated with those securities of $12.7 million and $65.7 million, respectively.

For the nine months ended September 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 September 30,						Nine Months Ended September 30,
(In thousands)	2015			2014			2015			2014
Net realized gains (losses):
Fixed-maturities held to maturity	$	—		$	—		$	—		$	(9	)
Fixed-maturities available for sale	(343		)	(540		)	(402		)	(1,139		)
Equities available for sale	—			—			68,723			—
Trading securities	(1		)	(52		)	(12,860		)	(4,444		)
Short-term investments	(27		)	—			(23		)	—
Other invested assets	2,794			—			2,794			—
Other gains	—			291			106			238
Net realized gains (losses) on investments	2,423			(301		)	58,338			(5,354		)
Unrealized gains (losses) on trading securities	1,810			(6,007		)	(9,127		)	70,565
Total net gains (losses) on investments	4,233			(6,308		)	49,211			65,211
Net (losses) gains on other financial instruments	(365		)	14			(116		)	(3,205		)
Net gains (losses) on investments and other financial instruments	$	3,868		$	(6,294	)	$	49,095		$	62,006

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:



September 30, 2015: ($ 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
Corporate bonds and notes	77	$	307,644	$	11,689	6	$	8,716	$	439	83	$	316,360	$	12,128
RMBS	6	70,121		360		—	—		—		6	70,121		360
CMBS	30	179,673		3,049		—	—		—		30	179,673		3,049
Other ABS	62	205,452		2,038		13	42,127		1,290		75	247,579		3,328
Foreign government and agency securities	14	14,394		971		4	1,536		235		18	15,930		1,206
Total	189	$	777,284	$	18,107	23	$	52,379	$	1,964	212	$	829,663	$	20,071



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 nine 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 September 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 September 30, 2015, were generally caused by interest rate or credit spread movements since the purchase date. As of September 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 September 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 September 30, 2015.

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



	September 30, 2015
	Available for Sale
(In thousands)	Amortized Cost		Fair Value
Due in one year or less (1)	$	2,292	$	2,299
Due after one year through five years (1)	104,053		104,854
Due after five years through ten years (1)	368,126		363,447
Due after ten years (1)	186,838		182,254
RMBS (2)	208,011		209,028
CMBS (2)	307,216		305,700
Other ABS (2)	330,986		328,746
Total	$	1,507,522	$	1,496,328

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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 September 30, 2015 and December 31, 2014, Radian Guaranty had $210.9 million and $209.3 million, respectively, in a collateral account pursuant to the Freddie Mac Agreement. This collateral account, which contains investments primarily invested in trading securities, is pledged to cover Loss Mitigation Activity on the loans subject to the Freddie Mac 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 that agreement. In accordance with these provisions, Radian withdrew approximately $135.9 million from this account in October 2015 related to Loss Mitigation Activity that had become final as of August 31, 2015. Following this withdrawal, if, as of August 29, 2017, the amount of additional Loss Mitigation Activity that has become final in accordance with the Freddie Mac Agreement is less than approximately $74 million, 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. Through September 30, 2015, approximately $1 million of additional Loss Mitigation Activity had become final in accordance with the Freddie Mac Agreement and approximately $11 million of additional submitted claims had been rescinded, denied, curtailed or cancelled, but were not yet considered final in accordance with the Freddie Mac Agreement.