(7) Investments

Investments include primarily investment-grade corporate bonds and U.S. Treasury obligations having maturities of up to five years (the “bond portfolio”). Investments in the bond portfolio are reported as available-for-sale and are carried at fair value. Investments maturing less than one year from the balance sheet date are included in short-term investments and investments maturing more than one year from the balance sheet date are included in other assets in the consolidated balance sheets. Management performs an analysis of the nature of the unrealized losses on available-for-sale investments to determine whether such losses are other-than-temporary. Unrealized losses, representing the excess of the purchase price of an investment over its fair value as of the end of a period, considered to be other-than-temporary, are to be included as a charge in the statement of income, while unrealized losses considered to be temporary are to be included as a component of shareholders’ equity. Investments whose values are based on quoted market prices in active markets are classified within Level 1. Investments that trade in markets that are not considered to be active, but are valued based on quoted market prices, are classified within Level 2. As Level 2 investments include positions that are not traded in active markets, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information. Any transfers between levels are recognized as of the beginning of any reporting period. Fair value of the bond portfolio was determined using Level 1 inputs related to U.S. Treasury obligations and money market investments and Level 2 inputs related to investment-grade corporate bonds, asset-backed securities and direct obligations of government agencies. Unrealized gains, net of unrealized losses, on the investments in the bond portfolio were $145,000 at July 1, 2017, while unrealized losses, net of unrealized gains, on the investments in the bond portfolio were $109,000 at December 31, 2016, respectively.

The amortized cost and fair values of available-for-sale investments are as follows at July 1, 2017 and December 31, 2016 (in thousands):


			Gross		Gross
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
July 1, 2017
Money market investments	$	14,422	$	—	$	—	$	14,422
Asset-backed securities		3,659		5		5		3,659
Corporate bonds and direct obligations of government agencies		80,122		311		158		80,275
U.S. Treasury obligations		11,988		—		8		11,980

Total	$	110,191	$	316	$	171	$	110,336

December 31, 2016
Money market investments	$	12,395	$	—	$	—	$	12,395
Asset-backed securities		4,027		3		19		4,011
Corporate bonds and direct obligations of government agencies		70,069		150		239		69,980
U.S. Treasury obligations		23,037		2		6		23,033

Total	$	109,528	$	155	$	264	$	109,419

For those available-for-sale investments with unrealized losses at July 1, 2017 and December 31, 2016, the following table summarizes the duration of the unrealized loss (in thousands):


	Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
July 1, 2017
Asset-backed securities	$	1,097	$	1	$	1,353	$	4	$	2,450	$	5
Corporate bonds and direct obligations of government agencies		29,252		125		2,276		33		31,528		158
U.S. Treasury obligations		11,980		8		—		—		11,980		8

Total	$	42,329	$	134	$	3,629	$	37	$	45,958	$	171

December 31, 2016
Asset-backed securities	$	1,363	$	6	$	2,314	$	13	$	3,677	$	19
Corporate bonds and direct obligations of government agencies		28,809		195		1,367		44		30,176		239
U.S. Treasury obligations		12,734		6		—		—		12,734		6

Total	$	42,906	$	207	$	3,681	$	57	$	46,587	$	264

The Company believes that unrealized losses on investments were primarily caused by rising interest rates rather than changes in credit quality. The Company expects to recover the amortized cost basis of these securities as it does not intend to sell, and does not anticipate being required to sell, these securities before recovery of the cost basis. For these reasons, the Company does not consider the unrealized losses on these securities to be other-than-temporary at July 1, 2017.