4. Investment Securities

Investment securities at June 30, 2014 and December 31, 2013 are as follows:

	Amortized		Unrealized	Unrealized
June 30, 2014	cost		gains	losses		Fair value
	(in thousands)
Available for sale securities:
Corporate bonds	$	3,018	6	—		3,024
Affiliated mutual funds	116,723		6,498	(27	)	123,194
	$	119,741	6,504	(27	)	126,218

Trading securities:
Mortgage-backed securities						34
Corporate bonds						2,991
Common stock						58
Affiliated mutual funds						88,051
						91,134

Total investment securities						$	217,352

	Amortized		Unrealized	Unrealized
December 31, 2013	cost		gains	losses		Fair value
	(in thousands)
Available for sale securities:
Mortgage-backed securities	$	8	1	—		9
Corporate bonds	14,568		61	—		14,629
Affiliated mutual funds	87,710		5,899	(957	)	92,652
	$	102,286	5,961	(957	)	107,290

Trading securities:
Mortgage-backed securities						37
Municipal bonds						501
Corporate bonds						9,412
Common stock						60
Affiliated mutual funds						84,048
						94,058

Total investment securities						$	201,348

Purchases of trading securities during the six months ended June 30, 2014 were $80.5 million. Sales and maturities of trading securities were $62.3 million for the same period.

A summary of available for sale affiliated mutual funds with fair values below carrying values at June 30, 2014 and December 31, 2013 is as follows:

	Less than 12 months			12 months or longer			Total
June 30, 2014	Fair value		Unrealized losses	Fair value	Unrealized losses		Fair value	Unrealized losses
	(in thousands)
Affiliated mutual funds	$	—	—	1,187	(27	)	1,187	(27	)
Total temporarily impaired securities	$	—	—	1,187	(27	)	1,187	(27	)

	Less than 12 months				12 months or longer			Total
December 31, 2013	Fair value		Unrealized losses		Fair value	Unrealized losses		Fair value	Unrealized losses
	(in thousands)
Affiliated mutual funds	$	29,598	(939	)	213	(18	)	29,811	(957	)
Total temporarily impaired securities	$	29,598	(939	)	213	(18	)	29,811	(957	)

Based upon our assessment of these affiliated mutual funds, the time frame the funds have been in a loss position, and our intent to hold affiliated mutual funds until they have recovered, we determined that a write-down was not necessary at June 30, 2014.

Corporate bonds accounted for as available for sale and held as of June 30, 2014 mature as follows:

	Amortized cost		Fair value
	(in thousands)
Within one year	$	3,018	3,024
	$	3,018	3,024

Mortgage-backed securities and corporate bonds accounted for as trading and held as of June 30, 2014 mature as follows:

	Fair value
	(in thousands)
Within one year	$	2,991
After five years but within 10 years	34
	$	3,025

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-level 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 June 30, 2014 and December 31, 2013 that are recognized in our consolidated balance sheets using fair value measurements based on the differing levels of inputs.

June 30, 2014	Level 1		Level 2	Level 3	Total
	(in thousands)
Mortgage-backed securities	$	—	34	—	34
Corporate bonds	—		6,015	—	6,015
Common stock	58		—	—	58
Affiliated mutual funds	211,245		—	—	211,245
Total	$	211,303	6,049	—	217,352

December 31, 2013	Level 1		Level 2	Level 3	Total
	(in thousands)
Mortgage-backed securities	$	—	46	—	46
Municipal bonds	—		501	—	501
Corporate bonds	—		24,041	—	24,041
Common stock	60		—	—	60
Affiliated mutual funds	176,700		—	—	176,700
Total	$	176,760	24,588	—	201,348