Investment in Securities

12 Months Ended

Dec. 31, 2011

Investment in Securities [Abstract]

Investment in Securities

B.  Investments in Securities

Investments in securities at December 31, 2011 and 2010 consisted of the following:

	2011				2010
	Cost		Fair Value		Cost		Fair Value
(In thousands)
Trading securities:
Government obligations	$	42,124	$	42,126	$	27,327	$	27,288
Common stocks		153,294		159,314		158,455		170,374
Mutual funds		1,099		1,325		1,205		1,554
Convertible bonds		-		-		574		620
Preferred stocks		-		-		1,783		1,973
Other investments		466		399		1,559		1,350
Total trading securities		196,983		203,164		190,903		203,159
Available for sale securities:
Common stocks		16,487		33,282		16,835		37,139
Mutual funds		40,679		61,101		43,707		65,188
Total available for sale securities		57,166		94,383		60,542		102,327
Total investments in securities	$	254,149	$	297,547	$	251,445	$	305,486

Securities sold, not yet purchased at December 31, 2011 and 2010 consisted of the following:

	2011				2010
	Cost		Fair Value		Cost		Fair Value
(In thousands)
Common stocks	$	5,271	$	5,415	$	19,071	$	19,299
Other		49		73		-		-
Total securities sold, not yet purchased	$	5,320	$	5,488	$	19,071	$	19,299

The aggregate fair value of common stock investments available for sale at December 31, 2011 and 2010 was$33.3 million and $37.1 million, respectively.  The total unrealized gains for common stock investments available for sale were $16.8 million and $20.3 million at December 31, 2011 and 2010, respectively.  There were no unrealized losses for common stock investments available for sale at December 31, 2011 or December 31, 2010.  At December 31, 2011 and 2010, the fair value of mutual fund investments available for sale with unrealized gains was $61.0 million and $65.2 million, respectively.  At December 31, 2011, the fair value of mutual fund investments available for sale with unrealized losses was $0.1 million.  At December 31, 2010 there were no unrealized losses for mutual fund investments available for sale.  The total unrealized gains for mutual fund investments available for sale were $20.5 million and $21.5 million at December 31, 2011 and 2010, respectively.  The total unrealized losses for mutual fund investments available for sale was $28,000 at December 31, 2011.

Increases in unrealized losses, net of taxes, for AFS securities for the year ended December 31, 2011 of $2.9 million have been included in equity at December 31, 2011.  Increases in unrealized gains, net of taxes, for AFS securities for the years ended December 31, 2010 and 2009 of $6.3 million and $4.1 million have been included in equity at December 31, 2010 and 2009, respectively.  Return of capital on available for sale securities were $2.3 million, $3.0 million and $3.7 million for the years ended December 31, 2011, 2010 and 2009, respectively.  Proceeds from sales of investments available for sale were approximately $6.1 million, $2.1 million and $4.3 million for the years ended December 31, 2011, 2010 and 2009, respectively.  For the years ended December 31, 2011, 2010 and 2009, gross gains on the sale of investments available for sale amounted to $772,000, $29,000 and $2.1 million, respectively, and were reclassed from other comprehensive income into the consolidated statements of income.  There were no losses on the sale of investments available for sale for the years ended December 31, 2011, 2010 and 2009.  The basis on which the cost of a security sold is determined is specific identification.

GBL has an established accounting policy and methodology to determine other-than-temporary impairment.  Under this policy, available for sale securities are evaluated for other than temporary impairments and any impairment charges are recorded in net gain/(loss) from investments on the consolidated statements of income.  Management reviews all available for sale securities whose cost exceeds their market value to determine if the impairment is other than temporary.  Management uses qualitative factors such as diversification of the investment, the amount of time that the investment has been impaired and the severity of the decline in determining whether the impairment is other than temporary.  

At December 31, 2011, there was one holding in a loss position which was not deemed to be other-than-temporarily impaired due to the length of time that it had been in a loss position and because it passed scrutiny in our evaluation of issuer-specific and industry-specific considerations.  In this specific instance, the investment at December 31, 2011 was a mutual fund with diversified holdings across multiple companies and across multiple industries.  The one holding was impaired for seven consecutive months.  The value of this holding at December 31, 2011 was $0.1 million.

At December 31, 2010, there were no available for sale holdings in loss positions.

For the years ended December 31, 2010 and 2009, there were no losses on available for sale securities deemed to be other than temporary.