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INVESTMENT SECURITIES
 6 Months Ended
Jun. 30, 2016
Investments, Debt and Equity Securities [Abstract]  
INVESTMENT SECURITIES
NOTE 6 - INVESTMENT SECURITIES
Components of investment securities are as follows (in thousands):
 
June 30,
2016
 
December 31,
2015
Available-for-sale securities
$
17,774

 
$
19,509

Trading securities
1,590

 
1,451

Trading securities - Pelium
24,552

 
26,516

Total investment securities, at fair value
$
43,916

 
$
47,476

    
Available-for-sale securities.  The following table discloses the pre-tax unrealized gains (losses) relating to the Company’s investments in available-for-sale securities (in thousands):
 
Cost or
Amortized Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair Value
As of June 30, 2016:
 
 
 
 
 
 
 
CLO securities
$
7,057

 
$
—

 
$
(412
)
 
$
6,645

Equity securities
12,784

 
6

 
(1,661
)
 
11,129

Total
$
19,841

 
$
6

 
$
(2,073
)
 
$
17,774

 
 
 
 
 
 
 
 
As of December 31, 2015:
 

 
 

 
 

 
 

CLO securities
$
7,585

 
$
928

 
$
(66
)
 
$
8,447

Equity securities
12,784

 
12

 
(1,734
)
 
11,062

Total
$
20,369

 
$
940

 
$
(1,800
)
 
$
19,509


CLO securities.  The CLO securities represent the Company’s retained equity interests in 14 and 15 CLO issuers that CVC Credit Partners has sponsored and manages at June 30, 2016 and December 31, 2015, respectively (see Note 7).  The fair value of these retained interests is impacted by the fair value of the investments held by the respective CLO issuers, which are sensitive to interest rate fluctuations and credit quality determinations. For the six months ended June 30, 2016, the Company adjusted its assumptions with respect to the fair value calculations of its CLO securities based on a change in market conditions, principally the reinvestment price was increased from 99.0 to 99.5, the post reinvestment price was increased from 99.0 to 99.75 and the discount rate was increased to 17%, which resulted in an impairment charge of $901,000. In 2015, the Company adjusted its assumptions by increasing the constant default rate in year one and two and decreasing the prepayment speed in year one which resulted in an impairment charge of $331,000.
Equity securities.  The Company holds 715,396 shares of RSO common stock and 18,972 shares of TBBK common stock, which are pledged as collateral for one of the Company’s secured corporate credit facilities. The Company also holds approximately 10,808 shares of DIF with a fair value of $108,000. The Company has an investment of $1.7 million in the CIF, an interval fund.
Trading securities. For the three and six months ended June 30, 2016, the Company had net gains on trading securities of $175,000, and $197,000 (including unrealized gains (losses) of $(13,000) and $9,000), respectively. For the three and six months ended June 30, 2015, the Company had net gains on trading securities of $22,000 and $28,000, (including unrealized gains of $22,000 and $42,000), respectively. These gains are reflected in Financial Fund Management Revenues on the consolidated statements of operations. Pelium, a consolidated VIE which holds securities with a fair value of $24.6 million at June 30, 2016, recorded realized losses of $412,000 and $7,000 and unrealized gains of $578,000 and $252,000 during the three and six months ended June 30, 2016 and realized gains of $201,000 and $884,000 and unrealized gains of $507,000 and $1.3 million during the three and six months ended June 30, 2015.
Unrealized losses on available-for-sale securities, along with their related fair value, and aggregated by the length of time the investments were in a continuous unrealized loss position, are as follows (in thousands, except number of securities):
 
Less than 12 Months
 
More than 12 Months
 
Fair Value
 
Unrealized
Losses
 
Number of Securities
 
Fair Value
 
Unrealized
Losses
 
Number of Securities
June 30, 2016
 
 
 
 
 
 
 
 
 
 
 
CLO securities
$
2,229

 
$
(212
)
 
5

 
$
3,640

 
$
(200
)
 
8

Equity securities
1,708

 
(8
)
 
1

 
9,308

 
(1,653
)
 
2

Total
$
3,937

 
$
(220
)
 
6

 
$
12,948

 
$
(1,853
)
 
10

December 31, 2015
 
 
 
 
 
 
 
 
 
 
 
CLO securities
$
2,033

 
$
(38
)
 
3

 
$
805

 
$
(28
)
 
2

Equity securities
1,814

 
(10
)
 
2

 
9,128

 
(1,724
)
 
1

Total
$
3,847

 
$
(48
)
 
5

 
$
9,933

 
$
(1,752
)
 
3



The unrealized losses in RSO common stock reflected in the above table are considered to be a temporary impairment due to market factors and not reflective of credit deterioration. Further, because of its intent and ability to hold its investment in RSO, the Company does not consider the unrealized losses to be an other-than-temporary impairment. Unrealized losses related to Pelium fund investments, along with the related fair value and aggregated by the length of time the investments were in a continuous unrealized loss position, are as follows (in thousands, except number of securities):


 
Less than 12 Months
 
More than 12 Months
 
Fair Value
 
Unrealized
Losses
 
Number of Securities
 
Fair Value
 
Unrealized
Losses
 
Number of Securities
June 30, 2016:
 
 
 
 
 
 
 
 
 
 
 
CDO Securities
$
10,880

 
$
(1,167
)
 
13

 
$
3,377

 
$
(1,365
)
 
12

CMBS
3,284

 
(1,192
)
 
3

 
—

 
—

 
—

Other
(4
)
 
(4
)
 
1

 
—

 
—

 
—

Total
$
14,160

 
$
(2,363
)
 
17

 
$
3,377

 
$
(1,365
)
 
12

 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2015:
 
 
 
 
 
 
 
 
 
 
 
CDO Securities
$
10,156

 
$
(3,312
)
 
18

 
$
1,183

 
$
(503
)
 
7

CMBS
2,940

 
(1,278
)
 
5

 
—

 
—

 
—

Other
2,857

 
(143
)
 
2

 
—

 
—

 
—

Total
$
15,953

 
$
(4,733
)
 
25

 
$
1,183

 
$
(503
)
 
7