Financial Assets And Financial Liabilities

9 Months Ended

Sep. 30, 2024

Financial Assets And Financial Liabilities [Abstract]

Financial Assets And Financial Liabilities

6. Financial Assets and Financial Liabilities

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

The tables below present, by level within the fair value hierarchy (see Note 2), financial assets and liabilities, measured at fair value on a recurring basis for the periods indicated. As required by ASC Topic 820, financial assets and financial liabilities are classified in their entirety based on the lowest level of input that is significant to the respective fair value measurement.



	Financial Assets at Fair Value as of September 30, 2024

	Level 1		Level 2		Level 3		Total

	(in millions)

Securities segregated for regulatory purposes
U.S. and foreign government securities	$	6,631	$	—	$	—	$	6,631
Municipal securities		—		57		—		57
Total securities segregated for regulatory purposes		6,631		57		—		6,688

Financial instruments owned, at fair value
Stocks		1,850		—		—		1,850
Options		119		—		—		119
U.S. and foreign government securities		948		—		—		948
Mutual funds		2		—		—		2
Precious metals		—		20		—		20
Currency forward contracts		—		10		—		10
Total financial instruments owned, at fair value		2,919		30		—		2,949

Other assets
Customer-held fractional shares		226		—		—		226
Crypto-asset safeguarding asset		—		242		—		242
Other investments in equity securities		54		—		—		54
Total other assets		280		242		—		522
Total financial assets at fair value	$	9,830	$	329	$	—	$	10,159



	Financial Liabilities at Fair Value as of September 30, 2024
	Level 1		Level 2		Level 3		Total

	(in millions)

Financial instruments sold, but not yet purchased, at fair value
Stocks	$	190	$	—	$	—	$	190
Options		172		—		—		172
Precious metals		—		17		—		17
Currency forward contracts		—		2		—		2
Total financial instruments sold, but not yet purchased, at fair value		362		19		—		381

Accounts payable, accrued expenses and other liabilities
Fractional shares repurchase obligation		226		—		—		226
Crypto-asset safeguarding liability		—		242		—		242
Total accounts payable, accrued expenses and other liabilities		226		242		—		468
Total financial liabilities at fair value	$	588	$	261	$	—	$	849

‎


	Financial Assets at Fair Value as of December 31, 2023
	Level 1		Level 2		Level 3		Total

	(in millions)

Securities segregated for regulatory purposes
U.S. and foreign government securities	$	5,684	$	—	$	—	$	5,684
Municipal securities		—		70		—		70
Total securities segregated for regulatory purposes		5,684		70		—		5,754

Financial instruments owned, at fair value
Stocks		1,023		—		—		1,023
Options		354		—		—		354
U.S. and foreign government securities		39		—		—		39
Precious metals		—		12		—		12
Currency forward contracts		—		60		—		60
Total financial instruments owned, at fair value		1,416		72		—		1,488

Other assets
Customer-held fractional shares		144		—		—		144
Crypto-asset safeguarding asset		—		172		—		172
Other investments in equity securities		44		—		—		44
Total other assets		188		172		—		360
Total financial assets at fair value	$	7,288	$	314	$	—	$	7,602



	Financial Liabilities at Fair Value as of December 31, 2023
	Level 1		Level 2		Level 3		Total

	(in millions)
Financial instruments sold, but not yet purchased, at fair value
Stocks	$	77	$	—	$	—	$	77
Options		104		—		—		104
Precious metals		—		7		—		7
Currency forward contracts		—		5		—		5
Total financial instruments sold, but not yet purchased, at fair value		181		12		—		193

Accounts payable, accrued expenses and other liabilities
Fractional shares repurchase obligation		144		—		—		144
Crypto-asset safeguarding liability		—		172		—		172
Total accounts payable, accrued expenses and other liabilities		144		172		—		316
Total financial liabilities at fair value	$	325	$	184	$	—	$	509

Level 3 Financial Assets and Financial Liabilities

There were no transfers in or out of level 3 for the nine months ended September 30, 2024.

‎

Financial Assets and Liabilities Not Measured at Fair Value

Financial assets and liabilities not measured at fair value are recorded at carrying value, which approximates fair value due to their short-term nature. The tables below represent the carrying value, fair value and fair value hierarchy category of certain financial assets and liabilities that are not recorded at fair value in the Company's condensed consolidated statements of financial condition for the periods indicated. The tables below exclude certain financial instruments such as equity method investments and all non-financial assets and liabilities.



	September 30, 2024
	Carrying ‎Value		Fair ‎Value		Level 1		Level 2		Level 3

	(in millions)
Financial assets, not measured at fair value
Cash and cash equivalents	$	3,595	$	3,595	$	3,595	$	—	$	—
Cash - segregated for regulatory purposes		35,216		35,216		35,216		—		—
Securities - segregated for regulatory purposes		24,415		24,415		—		24,415		—
Securities borrowed		7,513		7,513		—		7,513		—
Securities purchased under agreements to resell		8,176		8,176		—		8,176		—
Receivables from customers		56,006		56,006		—		56,006		—
Receivables from brokers, dealers and clearing organizations		2,210		2,210		—		2,210		—
Interest receivable		423		423		—		423		—
Other assets		30		32		—		3		29
Total financial assets, not measured at fair value	$	137,584	$	137,586	$	38,811	$	98,746	$	29



Financial liabilities, not measured at fair value
Short-term borrowings	$	33	$	33	$	—	$	33	$	—
Securities loaned		16,818		16,818		—		16,818		—
Payables to customers		112,579		112,579		—		112,579		—
Payables to brokers, dealers and clearing organizations		1,202		1,202		—		1,202		—
Interest payable		327		327		—		327		—
Total financial liabilities, not measured at fair value	$	130,959	$	130,959	$	—	$	130,959	$	—

‎



	December 31, 2023
	Carrying ‎Value		Fair ‎Value		Level 1		Level 2		Level 3

	(in millions)

Financial assets, not measured at fair value
Cash and cash equivalents	$	3,753	$	3,753	$	3,753	$	—	$	—
Cash - segregated for regulatory purposes		28,840		28,840		28,840		—		—
Securities - segregated for regulatory purposes		29,632		29,632		—		29,632		—
Securities borrowed		5,835		5,835		—		5,835		—
Securities purchased under agreements to resell		5,504		5,504		—		5,504		—
Receivables from customers		44,472		44,472		—		44,472		—
Receivables from brokers, dealers and clearing organizations		1,643		1,643		—		1,643		—
Interest receivable		375		375		—		375		—
Other assets		22		23		—		2		21
Total financial assets, not measured at fair value	$	120,076	$	120,077	$	32,593	$	87,463	$	21



Financial liabilities, not measured at fair value
Short-term borrowings	$	17	$	17	$	—	$	17	$	—
Securities loaned		11,347		11,347		—		11,347		—
Payables to customers		101,012		101,012		—		101,012		—
Payables to brokers, dealers and clearing organizations		590		590		—		590		—
Interest payable		311		311		—		311		—
Total financial liabilities, not measured at fair value	$	113,277	$	113,277	$	—	$	113,277	$	—

‎

Netting of Financial Assets and Financial Liabilities

The Company’s policy is to net securities borrowed and securities loaned, and securities purchased under agreements to resell and securities sold under agreements to repurchase that meet the offsetting requirements prescribed in ASC Topic 210-20. In the tables below, the amounts of financial instruments that are not offset in the condensed consolidated statements of financial condition, but could be netted against cash or financial instruments with specific counterparties under master netting agreements, according to the terms of the agreements, including clearing houses (exchange-traded options, warrants and discount certificates) or over the counter currency forward contract counterparties, are presented to provide financial statement readers with the Company’s net payable or receivable with counterparties for these financial instruments.

The tables below present the netting of financial assets and financial liabilities for the periods indicated.



	September 30, 2024
				Amounts			Net Amounts		Amounts Not Offset
	Gross			Offset in the			Presented in		in the Condensed
	Amounts			Condensed			the Condensed		Consolidated
	of Financial			Consolidated			Consolidated		Statements of
	Assets and			Statements of			Statements of		Financial Condition
	Liabilities			Financial			Financial		Cash or Financial		Net
	Recognized			Condition		²	Condition		Instruments		Amount

	(in millions)
Offsetting of financial assets
Securities segregated for regulatory purposes - purchased under agreements to resell	$	24,415	¹	$	—		$	24,415	$	(24,415)	$	—
Securities borrowed		7,513			—			7,513		(7,311)		202
Securities purchased under agreements to resell		8,176			—			8,176		(8,176)		—
Financial instruments owned, at fair value
Options		119			—			119		(83)		36
Currency forward contracts		10			—			10		—		10
Total	$	40,233		$	—		$	40,233	$	(39,985)	$	248


	(in millions)
Offsetting of financial liabilities
Securities loaned	$	16,818	$	—	$	16,818	$	(15,770)	$	1,048
Financial instruments sold, but not yet purchased, at fair value
Options		172		—		172		(83)		89
Currency forward contracts		2		—		2		—		2
Total	$	16,992	$	—	$	16,992	$	(15,853)	$	1,139

‎



	December 31, 2023
				Amounts			Net Amounts		Amounts Not Offset
		Gross		Offset in the			Presented in		in the Condensed
		Amounts		Condensed			the Condensed		Consolidated
		of Financial		Consolidated			Consolidated		Statements of
		Assets and		Statements of			Statements of		Financial Condition
		Liabilities		Financial			Financial		Cash or Financial		Net
		Recognized		Condition		²	Condition		Instruments		Amount

	(in millions)
Offsetting of financial assets
Securities segregated for regulatory purposes - purchased under agreements to resell	$	29,632	¹	$	—		$	29,632	$	(29,632)	$	—
Securities borrowed		5,835			—			5,835		(5,618)		217
Securities purchased under agreements to resell		5,504			—			5,504		(5,504)		—
Financial instruments owned, at fair value
Options		354			—			354		(104)		250
Currency forward contracts		60			—			60		—		60
Total	$	41,385		$	—		$	41,385	$	(40,858)	$	527


	(in millions)
Offsetting of financial liabilities
Securities loaned	$	11,347	$	—	$	11,347	$	(10,443)	$	904
Financial instruments sold, but not yet purchased, at fair value
Options		104		—		104		(104)		—
Currency forward contracts		5		—		5		—		5
Total	$	11,456	$	—	$	11,456	$	(10,547)	$	909

________________________

(1)As of September 30, 2024 and December 31, 2023, the Company had $24.4 billion and $29.6 billion, respectively, of securities purchased under agreements to resell that were segregated to satisfy regulatory requirements. These securities are included in “Securities - segregated for regulatory purposes” in the condensed consolidated statements of financial condition.

(2)The Company did not have any balances eligible for netting in accordance with ASC Topic 210-20 as of September 30, 2024 and December 31, 2023.

‎

Secured Financing Transactions – Maturities and Collateral Pledged

The tables below present gross obligations for securities loaned transactions by remaining contractual maturity and class of collateral pledged for the periods indicated.



	September 30, 2024
	Remaining Contractual Maturity
	Overnight		Less than		30 – 90		Over 90
	and Open		30 days		days		days		Total

	(in millions)

Securities loaned
Stocks	$	16,777	$	—	$	—	$	—	$	16,777
Corporate bonds		41		—		—		—		41
Total securities loaned	$	16,818	$	—	$	—	$	—	$	16,818


	December 31, 2023
	Remaining Contractual Maturity
	Overnight		Less than		30 – 90		Over 90
	and Open		30 days		days		days		Total

	(in millions)

Securities loaned
Stocks	$	11,306	$	—	$	—	$	—	$	11,306
Corporate bonds		41		—		—		—		41
Total securities loaned	$	11,347	$	—	$	—	$	—	$	11,347

‎

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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