4. Investment Securities

Investment securities at March 31, 2013 and December 31, 2012 are as follows:

	Amortized		Unrealized	Unrealized
March 31, 2013	cost		gains	losses		Fair value
	(in thousands)
Available for sale securities:
Mortgage-backed securities	$	9	1	—		10
Corporate bonds	30,190		208	(1	)	30,397
Affiliated mutual funds	69,239		5,533	(49	)	74,723
	$	99,438	5,742	(50	)	105,130

Trading securities:
Mortgage-backed securities						42
Municipal bonds						501
Corporate bonds						12,049
Common stock						48
Affiliated mutual funds						57,838
						70,478
Total investment securities						$	175,608

	Amortized		Unrealized	Unrealized
December 31, 2012	cost		gains	losses		Fair value
	(in thousands)
Available for sale securities:
Mortgage-backed securities	$	9	1	—		10
Corporate bonds	30,408		248	(3	)	30,653
Affiliated mutual funds	73,443		3,749	(1,090	)	76,102
	$	103,860	3,998	(1,093	)	106,765

Trading securities:
Mortgage-backed securities						44
Municipal bonds						501
Corporate bonds						12,112
Common stock						37
Affiliated mutual funds						56,683
						69,377
Total investment securities						$	176,142

Purchases of trading securities during the three months ended March 31, 2013 were $49.8 million. Sales of trading securities were $50.8 million for the same period.

A summary of available for sale debt securities and affiliated mutual funds with fair values below carrying values at March 31, 2013 and December 31, 2012 is as follows:

	Less than 12 months				12 months or longer			Total
			Unrealized		Fair	Unrealized		Fair	Unrealized
March 31, 2013	Fair value		losses		value	losses		value	losses
	(in thousands)
Corporate bonds	$	5,800	(1	)	—	—		5,800	(1	)
Affiliated mutual funds	—		—		3,177	(49	)	3,177	(49	)
Total temporarily impaired securities	$	5,800	(1	)	3,177	(49	)	8,977	(50	)

	Less than 12 months				12 months or longer			Total
			Unrealized		Fair	Unrealized		Fair	Unrealized
December 31, 2012	Fair value		losses		value	losses		value	losses
	(in thousands)
Corporate bonds	$	997	(3	)	—	—		997	(3	)
Affiliated mutual funds	23,478		(469	)	5,604	(621	)	29,082	(1,090	)
Total temporarily impaired securities	$	24,475	(472	)	5,604	(621	)	30,079	(1,093	)

Based upon our assessment of these corporate bonds and affiliated mutual funds, the time frame investments have been in a loss position, our intent to hold affiliated mutual funds until they have recovered, and our history of holding bonds until maturity, we determined that a write-down was not necessary at March 31, 2013.

Mortgage-backed securities and corporate bonds accounted for as available for sale and held as of March 31, 2013 mature as follows:

	Amortized cost		Fair value
	(in thousands)
Within one year	$	18,811	18,850
After one year but within five years	11,379		11,547
After five years but within 10 years	9		10
	$	30,199	30,407

Mortgage-backed securities, municipal bonds and corporate bonds accounted for as trading and held as of March 31, 2013 mature as follows:

	Fair value
	(in thousands)
Within one year	$	2,504
After one year but within five years	9,546
After five years but within 10 years	542
	$	12,592

Accounting standards establish a framework for measuring fair value and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of the asset. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset. An individual investment’s fair value measurement is assigned a level based upon the observability of the inputs that are significant to the overall valuation. The three-tier hierarchy of inputs is summarized as follows:

· Level 1 — Investments are valued using quoted prices in active markets for identical securities.

· Level 2 — Investments are valued using other significant observable inputs, including quoted prices in active markets for similar securities.

· Level 3 — Investments are valued using significant unobservable inputs, including the Company’s own assumptions in determining the fair value of investments.

Assets classified as Level 2 can have a variety of observable inputs. These observable inputs are collected and utilized, primarily by an independent pricing service, in different evaluated pricing approaches depending upon the specific asset to determine a value. The fair value of municipal bonds is measured based on pricing models that take into account, among other factors, information received from market makers and broker/dealers, current trades, bid-wants lists, offerings, market movements, the callability of the bond, state of issuance and benchmark yield curves. The fair value of corporate bonds is measured using various techniques, which consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads and fundamental data relating to the issuer.

Securities’ values classified as Level 3 are primarily determined through the use of a single quote (or multiple quotes) from dealers in the securities using proprietary valuation models. These quotes involve significant unobservable inputs, and thus, the related securities are classified as Level 3 securities.

The following tables summarize our investment securities as of March 31, 2013 and December 31, 2012 that are recognized in our consolidated balance sheets using fair value measurements based on the differing levels of inputs.

March 31, 2013	Level 1		Level 2	Level 3	Total
	(in thousands)
Mortgage-backed securities	$	—	52	—	52
Municipal bonds	—		501	—	501
Corporate bonds	—		42,446	—	42,446
Common stock	48		—	—	48
Affiliated mutual funds	132,561		—	—	132,561
Total	$	132,609	42,999	—	175,608

December 31, 2012	Level 1		Level 2	Level 3	Total
	(in thousands)
Mortgage-backed securities	$	—	54	—	54
Municipal bonds	—		501	—	501
Corporate bonds	—		42,765	—	42,765
Common stock	37		—	—	37
Affiliated mutual funds	132,785		—	—	132,785
Total	$	132,822	43,320	—	176,142