Fair Value Measurements for Operating Entities and Consolidated Funds (Tables)

6 Months Ended

Jun. 30, 2012

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following table presents the assets and liabilities that are measured at fair value on a recurring basis on the condensed consolidated statements of financial condition by caption and by level within the valuation hierarchy as of June 30, 2012 and December 31, 2011:

Operating Entities



	Assets at Fair Value as of June 30, 2012
	Level 1		Level 2		Level 3		Total
			(dollars in thousands)
Securities owned and derivatives
US Government securities	$	206,123	$	—	$	—	$	206,123
Common stocks	352,841		40		959		353,840
Convertible bonds	—		12,633		—		12,633
Corporate bonds	—		191,840		—		191,840
Futures	236		—		—		236
Currency forwards	—		16		—		16
Options	36,079		441		—		36,520
Warrants and rights	650		—		2,844		3,494
Mutual funds	2,816		—		—		2,816
Other investments
Portfolio Funds	—		26,207		19,876		46,083
Real estate investments	—		—		2,079		2,079
Lehman claim	—		—		731		731
	$	598,745	$	231,177	$	26,489	$	856,411



	Liabilities at Fair Value as of June 30, 2012
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Securities sold, not yet purchased and derivatives
US Government securities	$	225,679	$	—	$	—	$	225,679
Common stocks	142,314		—		—		142,314
Corporate bonds	—		7,985		—		7,985
Futures	19		—		—		19
Currency forwards	—		814		—		814
Options	24,894		70		—		24,964
Warrants and rights	—		—		3		3
	$	392,906	$	8,869	$	3	$	401,778



	Assets at Fair Value as of December 31, 2011
	Level 1		Level 2		Level 3		Total
			(dollars in thousands)
Securities owned and derivatives
US Government securities	$	182,868	$	—	$	—	$	182,868
Common stocks	248,598		713		1,069		250,380
Convertible bonds	—		18,130		—		18,130
Corporate bonds	—		231,864		—		231,864
Futures	172		—		—		172
Equity swaps	—		635		—		635
Options	55,530		169		—		55,699
Warrants and rights	1,225		—		1,534		2,759
Mutual funds	3,214		—		—		3,214
Other investments
Portfolio Funds	—		23,431		16,919		40,350
Real estate investments	—		—		2,353		2,353
Lehman claim	—		—		553		553
	$	491,607	$	274,942	$	22,428	$	788,977



	Liabilities at Fair Value as of December 31, 2011
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Securities sold, not yet purchased and derivatives
US Government securities	$	165,197	$	—	$	—	$	165,197
Common stocks	123,875		2		—		123,877
Corporate bonds	—		1,529		—		1,529
Futures	617		—		—		617
Equity swaps—short exposure	—		140		—		140
Options	43,648		—		—		43,648
	$	333,337	$	1,671	$	—	$	335,008

Consolidated Funds' investments



	Assets at Fair Value as of June 30, 2012
	Level 1		Level 2		Level 3		Total
			(dollars in thousands)
Securities owned
US Government securities	$	1,602	$	—	$	—	$	1,602
Commercial paper	—		632		—		632
Corporate bonds	—		—		—		—
Other investments
Portfolio Funds	—		11,873		209,507		221,380
Lehman claims	—		—		6,538		6,538
	$	1,602	$	12,505	$	216,045	$	230,152



	Assets at Fair Value as of December 31, 2011
	Level 1		Level 2		Level 3		Total
			(dollars in thousands)
Securities owned
US Government securities	$	2,006	$	—	$	—	$	2,006
Commercial paper	—		3,927		—		3,927
Corporate bonds	—		401		—		401
Other investments
Portfolio Funds	—		8,078		213,402		221,480
Lehman claims	—		—		7,340		7,340
	$	2,006	$	12,406	$	220,742	$	235,154

Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation

The following table includes a rollforward of the amounts for the three and six months ended June 30, 2012 and 2011 for financial instruments classified within level 3. The classification of a financial instrument within level 3 is based upon the significance of the unobservable inputs to the overall fair value measurement.



	Three Months Ended June 30, 2012 and 2011
	Operating Entities																						Consolidated Funds
	Common stocks			Common stocks, sold not yet purchased			Restricted Common Stock		Warrants and Rights			Warrants and Rights, sold not yet purchased			Portfolio Funds			Real estate			Lehman claim		Portfolio Funds			Lehman claim
	(dollars in thousands)
Balance at March 31, 2012	$	1,079		$	—		$	—	$	3,316		$	—		$	19,012		$	2,579		$	574	$	215,815		$	5,346
Transfers in	—			—			—		—			—			—			—			—		—			—
Transfers out	—			—			—		—			—			—			—			—		—			—
Purchases/(covers)	—			—			—		25			(4		)	1,230			—			—		19			—
(Sales)/short buys	—			—			—		—			9			(285		)	(501		)	—		(2,138		)	—
Realized gains (losses)	—			—			—		—			—			2			—			—		(1,906		)	1,192
Unrealized gains (losses)	(120		)	—			—		(497		)	(2		)	(83		)	1			157		(2,283		)	—
Balance at June 30, 2012	$	959		$	—		$	—	$	2,844		$	3		$	19,876		$	2,079		$	731	$	209,507		$	6,538

Balance at March 31, 2011	$	490		$	401		$	5,000	$	2,902		$	—		$	17,660		$	2,102		$	501	$	260,443		$	7,193
Transfers in	—			—			—		—			—			—			—			—		—			—
Transfers out	—			—			—		—			—			—			—			—		—			—
Purchases/(covers)	659			(826		)	—		—			—			2,322			141			—		—			—
(Sales)/short buys	(409		)	417			—		(48		)	—			(2,587		)	—			—		(28,300		)	—
Realized gains (losses)	—			(7		)	—		48			—			11			—			—		843			—
Unrealized gains (losses)	213			15			—		632			—			338			46			—		6,602			127
Balance at June 30, 2011	$	953		$	—		$	5,000	$	3,534		$	—		$	17,744		$	2,289		$	501	$	239,588		$	7,320



	Six Months Ended June 30, 2012 and 2011
	Operating Entities																								Consolidated Funds
	Common stocks			Common stocks, sold not yet purchased			Restricted Common Stock		Warrants and Rights				Warrants and Rights, sold not yet purchased				Portfolio Funds			Real estate			Lehman claim		Portfolio Funds				Lehman claim
	(dollars in thousands)
Balance at December 31, 2011	$	1,069		$	—		$	—	$	1,534			$	—			$	16,919		$	2,353		$	553	$	213,402			$	7,340
Transfers in	—			—			—		—				—				—			—			—		16,227			(a)	—
Transfers out	—			—			—		(88		)	(b)	(1,004		)	(c)	—			—			—		(17,151		)	(a)	—
Purchases/(covers)	—			—			—		282				(306		)		2,851			152			—		434				—
(Sales)/short buys	(6		)	—			—		(65		)		982				(814		)	(501		)	—		(5,026		)		(2,291		)
Realized gains (losses)	6			—			—		56				(35		)		7			—			—		(1,692		)		1,914
Unrealized gains (losses)	(110		)	—			—		1,125				366				913			75			178		3,313				(425		)
Balance at June 30, 2012	$	959		$	—		$	—	$	2,844			$	3			$	19,876		$	2,079		$	731	$	209,507			$	6,538

Balance at December 31, 2010	$	334		$	—		$	5,000	$	1,977			$	—			$	17,081		$	1,882		$	313	$	311,242			$	6,243
Transfers in	—			—			—		—				—				—			—			—		—				—
Transfers out	—			—			—		—				—				—			—			—		—				—
Purchases/(covers)	659			(978		)	—		65				—				36,573			237			—		1				—
(Sales)/short buys	(409		)	833			—		(48		)		—				(36,729		)	(5		)	—		(80,924		)		—
Realized gains (losses)	—			145			—		48				—				107			—			—		2,376				—
Unrealized gains (losses)	369			—			—		1,492				—				712			175			188		6,893				1,077
Balance at June 30, 2011	$	953		$	—		$	5,000	$	3,534			$	—			$	17,744		$	2,289		$	501	$	239,588			$	7,320

(a) Change in consolidated funds (see Note 3b).

(b) The security was listed on an exchange subsequent to a private funding.

Fair Value Inputs, Assets, Quantitative Information

The following table includes quantitative information as of June 30, 2012 for financial instruments classified within level 3. The table below quantifies information about the significant unobservable inputs used in the fair value measurement of the Company's level 3 financial instruments.



	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value at June 30, 2012		Valuation techniques	Unobservable Inputs	Range (weighted average)

Common stocks	$	959	Discounted cash flows, market multiples, recent transactions, bid levels, and comparable transactions.	Market multiples, valuation metric weights, and DCF discount rate.	Valuation metric: 25%-100%. DCF discount rates: 25%, Market multiples: 9x-10x
Warrants and rights	2,841		Model based	Volatility	Volatility: 20 to 40
Real estate	277		Market approach, income approach, and replacement cost.	Capital rate, DCF discount rate, net operating income, and replacement cost assumptions.	Capital rate: 4.74% to 8.75%
Lehman claim	731		Discounted cash flows and market quotes.	Projected cash flows and DCF discount rate.	Timing of projected cash flow: 1 year. DCF discount rate: 15%
	$	4,808
Other level 3 assets and liabilities (a)	237,723
Total level 3 assets and liabilities	$	242,531

(a)

Quantitative disclosures of unobservable inputs and assumptions are not required for investments for which NAV per share is used as a practical expedient to determine fair value, as their redemption features rather than observability of inputs cause them to be classified as a level 3 type asset within the fair value hierarchy. In addition, the fair value of the Consolidated Funds' investments are determined based on net asset value and therefore quantitative disclosures are not included in the table above.