Investment Securities (Tables)

3 Months Ended

Mar. 31, 2019

Investment securities at March 31, 2019 and December 31, 2018 were as follows:


	March 31,		December 31,
	2019		2018
		(in thousands)
Available for sale securities:
Certificates of deposit	$	—	5,001
Commercial paper		8,305	7,970
Corporate bonds		257,083	218,121
U.S. Treasury bills		—	19,672
Total available for sale securities		265,388	250,764
Trading debt securities:
Commercial paper		1,175	1,993
Corporate bonds		77,739	77,250
U.S. Treasury bills		5,913	5,884
Mortgage-backed securities		7	7
Consolidated sponsored funds		35,165	33,088
Total trading securities		119,999	118,222
Equity securities:
Common stock		30,680	21,204
Sponsored funds		152,481	153,548
Sponsored privately offered funds		797	678
Consolidated sponsored funds		27,883	24,879
Total equity securities		211,841	200,309
Equity method securities:
Sponsored funds		51,824	47,840
Total securities	$	649,052	617,135

Summary of maturities of securities held

Commercial paper and corporate bonds accounted for as available for sale and held as of March 31, 2019 mature as follows:


		Amortized
		cost	Fair value
		(in thousands)
Within one year	$	105,490	105,322
After one year but within five years		158,769	160,066
	$	264,259	265,388

Commercial paper, corporate bonds, U.S. Treasury bills and mortgage-backed securities accounted for as trading and held as of March 31, 2019 mature as follows:


		Fair value
		(in thousands)
Within one year	$	29,141
After one year but within five years		51,261
After five years but within 10 years		4,432
	$	84,834

Summary of the gross unrealized gains (losses) related to securities

The following is a summary of the gross unrealized gains (losses) related to securities classified as available for sale at March 31, 2019:


	Amortized		Unrealized	Unrealized
	cost		gains	losses	Fair value
	(in thousands)
Available for sale securities:
Commercial paper	$	8,304	1	—	8,305
Corporate bonds		255,955	1,668	(540)	257,083
	$	264,259	1,669	(540)	265,388

The following is a summary of the gross unrealized gains (losses) related to securities classified as available for sale at December 31, 2018:


	Amortized		Unrealized	Unrealized
	cost		gains	losses	Fair value
	(in thousands)
Available for sale securities:
Certificates of deposit	$	5,000	1	—	5,001
Commercial paper		7,902	68	—	7,970
Corporate bonds		219,236	254	(1,369)	218,121
U.S. Treasury bills		19,672	—	—	19,672
	$	251,810	323	(1,369)	250,764

Summary of available for sale sponsored funds with fair values below carrying values

A summary of available for sale investment securities with fair values below carrying values at March 31, 2019 is as follows:

Less than 12 months

12 months or longer

Total

Unrealized

March 31, 2019

Fair value

losses

Fair value

losses

Fair value

losses

(in thousands)

Corporate bonds

4,959

(41)

104,926

(499)

109,885

(540)

A summary of available for sale investment securities with fair values below carrying values at December 31, 2018 is as follows:

Less than 12 months

12 months or longer

Total

Unrealized

December 31, 2018

Fair value

losses

Fair value

losses

Fair value

losses

(in thousands)

Corporate bonds

36,302

(160)

119,480

(1,209)

155,782

(1,369)

Summary of balances related to consolidated sponsored funds as well the company’s net interest in these funds

The following table details the balances related to consolidated sponsored funds at March 31, 2019 and December 31, 2018, as well as the Company’s net interest in these funds:


	March 31,		December 31,
	2019		2018
	(in thousands)
Cash	$	6,086	4,285
Investments		63,048	57,967
Other assets		762	872
Other liabilities		(1,093)	(79)
Redeemable noncontrolling interests		(12,936)	(11,463)
Net interest in consolidated sponsored funds	$	55,867	51,582

Schedule of fair value of investment securities

The following tables summarize our investment securities as of March 31, 2019 and December 31, 2018 that are recognized in our consolidated balance sheets using fair value measurements based on the differing levels of inputs.


March 31, 2019	Level 1		Level 2	Level 3	Other Assets Held at Net Asset Value	Total
	(in thousands)
Cash equivalents: (1)
Money market funds	$	119,874	—	—	—	119,874
U.S. government sponsored enterprise note		—	895	—	—	895
Commercial paper		—	36,066	—	—	36,066
Total cash equivalents	$	119,874	36,961	—	—	156,835
Available for sale securities:
Commercial paper	$	—	8,305	—	—	8,305
Corporate bonds		—	257,083	—	—	257,083
Trading debt securities:
Commercial paper		—	1,175	—	—	1,175
Corporate bonds		—	77,739	—		77,739
U.S. Treasury bills		—	5,913	—	—	5,913
Mortgage-backed securities		—	7	—	—	7
Consolidated sponsored funds		—	35,165	—	—	35,165
Equity securities:
Common stock		30,660	—	20	—	30,680
Sponsored funds		152,481	—	—	—	152,481
Sponsored privately offered funds measured at net asset value (2)		—	—	—	797	797
Consolidated sponsored funds		27,883	—	—	—	27,883
Equity method securities: (3)
Sponsored funds		51,824	—	—	—	51,824
Total investment securities	$	262,848	385,387	20	797	649,052


December 31, 2018	Level 1		Level 2	Level 3	Other Assets Held at Net Asset Value	Total
	(in thousands)
Cash equivalents: (1)
Money market funds	$	121,759	—	—	—	121,759
U.S. government sponsored enterprise note		—	895	—	—	895
Commercial paper		—	74,277	—	—	74,277
Total cash equivalents	$	121,759	75,172	—	—	196,931
Available for sale securities:
Certificates of deposit	$	—	5,001	—	—	5,001
Commercial paper		—	7,970	—	—	7,970
Corporate bonds		—	218,121	—	—	218,121
U.S. Treasury bills		—	19,672	—	—	19,672
Trading debt securities:
Commercial paper		—	1,993	—	—	1,993
Corporate bonds		—	77,250	—		77,250
U.S. Treasury bills		—	5,884	—	—	5,884
Mortgage-backed securities		—	7	—	—	7
Consolidated sponsored funds		—	33,088	—	—	33,088
Equity securities:
Common stock		21,192	—	12	—	21,204
Sponsored funds		153,548	—	—	—	153,548
Sponsored privately offered funds measured at net asset value (2)		—	—	—	678	678
Consolidated sponsored funds		24,879	—	—	—	24,879
Equity method securities: (3)
Sponsored funds		47,840	—	—	—	47,840
Total investment securities	$	247,459	368,986	12	678	617,135

(1)

Cash equivalents include highly liquid investments with original maturities of 90 days or less. Cash investments in actively traded money market funds are measured at net asset value and are classified as Level 1. Cash investments in commercial paper are measured at cost, which approximates fair value because of the short time between purchase of the instrument and its expected realization, and are classified as Level 2.

(2)

Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.

(3)

Substantially all of the Company’s equity method investments are investment companies that record their underlying investments at fair value.

Schedule of activity of investments categorized as Level 3

The following table summarizes the activity of investments categorized as Level 3 for the three months ended March 31, 2019:


	Three months ended
	March 31, 2019
	(in thousands)
Level 3 assets at December 31, 2018	$	12
Additions		—
Valuation change		8
Redemptions		—
Level 3 assets at March 31, 2019	$	20