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Fair Value Disclosures
 12 Months Ended
Nov. 30, 2024
Fair Value Disclosures [Abstract]  
Fair Value Disclosures Note 6. Fair Value Disclosures
November 30, 2024 (1)
$ in thousands
Level 1
Level 2
Level 3
Counterparty
and Cash
Collateral
Netting (2)
Total
Assets:
Financial instruments owned:
Corporate equity securities ................................................................................
$5,238,058
$302,051
$239,364
$—
$5,779,473
Corporate debt securities ...................................................................................
—
5,310,815
24,931
—
5,335,746
Collateralized debt obligations and collateralized loan obligations ............
—
1,029,662
63,976
—
1,093,638
U.S. government and federal agency securities .............................................
3,583,139
160,227
—
—
3,743,366
Municipal securities ............................................................................................
—
320,507
—
—
320,507
Sovereign obligations .........................................................................................
749,912
630,681
172
—
1,380,765
Residential mortgage-backed securities .........................................................
—
2,348,862
7,714
—
2,356,576
Commercial mortgage-backed securities .......................................................
—
146,752
477
—
147,229
Other asset-backed securities ...........................................................................
—
110,687
103,214
—
213,901
Loans and other receivables ..............................................................................
—
1,706,152
152,586
—
1,858,738
Derivatives ............................................................................................................
146
3,181,454
3,926
(2,667,751)
517,775
Investments at fair value ....................................................................................
—
6
137,865
—
137,871
Total financial instruments owned, excluding Investments at fair value
based on NAV .................................................................................................
$9,571,255
$15,247,856
$734,225
$(2,667,751)
$22,885,585
Securities segregated and on deposit for regulatory purposes or
deposited with clearing and depository organizations ............................
$120,414
$—
$—
$—
$120,414
Securities received as collateral .......................................................................
185,588
—
—
—
185,588
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities ................................................................................
$3,013,877
$73,240
$208
$—
$3,087,325
Corporate debt securities ...................................................................................
—
3,105,010
165
—
3,105,175
U.S. government and federal agency securities .............................................
2,904,379
26
—
—
2,904,405
Sovereign obligations .........................................................................................
667,647
422,124
—
—
1,089,771
Commercial mortgage-backed securities .......................................................
—
—
1,153
—
1,153
Loans.....................................................................................................................
—
92,321
16,864
—
109,185
Derivatives ............................................................................................................
13
3,477,802
26,212
(2,793,713)
710,314
Total financial instruments sold, not yet purchased ....................................
$6,585,916
$7,170,523
$44,602
$(2,793,713)
$11,007,328
Other secured financings ...................................................................................
—
9,964
14,884
—
24,848
Obligation to return securities received as collateral ....................................
185,588
—
—
—
185,588
Long-term debt ....................................................................................................
—
1,529,443
821,903
—
2,351,346
(1)Excludes investments at fair value based on net asset value (“NAV”) of $1.25 billion at November 30, 2024 by level within the fair value hierarchy.
(2)Represents counterparty and cash collateral netting across the levels of the fair value hierarchy for positions with the same counterparty.
November 30, 2023 (1)
$ in thousands
Level 1
Level 2
Level 3
Counterparty
and Cash
Collateral
Netting (1)
Total
Assets:
Financial instruments owned:
Corporate equity securities ................................................................................
$3,831,698
$211,182
$181,294
$—
$4,224,174
Corporate debt securities ...................................................................................
—
4,921,222
26,112
—
4,947,334
Collateralized debt obligations and collateralized loan obligations ............
—
869,246
64,862
—
934,108
U.S. government and federal agency securities .............................................
3,563,164
65,566
—
—
3,628,730
Municipal securities ............................................................................................
—
223,502
—
—
223,502
Sovereign obligations .........................................................................................
1,051,494
609,452
—
—
1,660,946
Residential mortgage-backed securities .........................................................
—
2,048,309
20,871
—
2,069,180
Commercial mortgage-backed securities .......................................................
—
344,902
508
—
345,410
Other asset-backed securities ...........................................................................
—
255,048
117,661
—
372,709
Loans and other receivables ..............................................................................
—
1,320,217
130,101
—
1,450,318
Derivatives ............................................................................................................
314
3,649,814
8,336
(3,107,620)
550,844
Investments at fair value ....................................................................................
—
—
130,835
—
130,835
Total financial instruments owned, excluding Investments at fair value
based on NAV .................................................................................................
$8,446,670
$14,518,460
$680,580
$(3,107,620)
$20,538,090
Securities segregated and on deposit for regulatory purposes or
deposited with clearing and depository organizations .............................
$110,198
$—
$—
$—
$110,198
Securities received as collateral .......................................................................
8,800
—
—
—
8,800
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities ................................................................................
$2,235,049
$83,180
$676
$—
$2,318,905
Corporate debt securities ...................................................................................
—
2,842,776
124
—
2,842,900
Collateralized debt obligations and collateralized loan obligations ............
—
36
—
—
36
U.S. government and federal agency securities .............................................
2,957,787
—
—
—
2,957,787
Sovereign obligations .........................................................................................
1,229,795
579,302
—
—
1,809,097
Residential mortgage-backed securities .........................................................
—
463
—
—
463
Commercial mortgage-backed securities ......................................................
—
—
840
—
840
Loans.....................................................................................................................
—
173,828
1,521
—
175,349
Derivatives ............................................................................................................
54
3,851,004
59,291
(2,764,572)
1,145,777
Total financial instruments sold, not yet purchased ....................................
$6,422,685
$7,530,589
$62,452
$(2,764,572)
$11,251,154
Other secured financings ...................................................................................
$—
$—
$3,898
$—
$3,898
Obligation to return securities received as collateral ...................................
8,800
—
—
—
8,800
Long-term debt ....................................................................................................
—
963,846
744,597
—
1,708,443
(1)Excludes investments at fair value based on net asset value (“NAV”) of $1.21 billion at November 30, 2023 by level within the fair value hierarchy.
(2)Represents counterparty and cash collateral netting across the levels of the fair value hierarchy for positions with the same counterparty.
The following is a description of the valuation basis, including
valuation techniques and inputs, used in measuring our financial
assets and liabilities that are accounted for at fair value on a
recurring basis:
Cash and securities segregated and on deposit for regulatory
purposes or deposited with clearing and depository organizations
Segregated U.S. Treasury securities are measured based on
quoted market prices obtained from external pricing services and
categorized within Level 1 of the fair value hierarchy.
Corporate Equity Securities
•Exchange-Traded Equity Securities: Exchange-traded equity
securities are measured based on quoted closing exchange
prices, which are generally obtained from external pricing
services, and are categorized within Level 1 of the fair value
hierarchy, otherwise they are categorized within Level 2 of the
fair value hierarchy.
•Non-Exchange-Traded Equity Securities: Non-exchange-traded
equity securities are measured, where available, using broker
quotations, pricing data from external pricing services and
prices observed from recently executed market transactions
and are categorized within Level 2 of the fair value hierarchy.
Where such information is not available, non-exchange-traded
equity securities are categorized within Level 3 of the fair value
hierarchy and measured using valuation techniques involving
quoted prices of or market data for comparable companies,
similar company ratios and multiples (e.g., price/Earnings
before interest, taxes, depreciation and amortization
(“EBITDA”), price/book value), discounted cash flow analyses
and transaction prices observed from subsequent financing or
capital issuance by the company. When using pricing data of
comparable companies, judgment must be applied to adjust
the pricing data to account for differences between the
measured security and the comparable security (e.g., issuer
market capitalization, yield, dividend rate, geographical
concentration).
•Equity Warrants: Non-exchange-traded equity warrants are
measured primarily from observed prices on recently executed
market transactions and broker quotations and are categorized
within Level 2 of the fair value hierarchy. Where such
information is not available, non-exchange-traded equity
warrants are generally categorized within Level 3 of the fair
value hierarchy and can be measured using third-party
valuation services or the Black-Scholes model with key inputs
impacting the valuation including the underlying security price,
implied volatility, dividend yield, interest rate curve, strike price
and maturity date.
Corporate Debt Securities
•Investment Grade Corporate Bonds: Investment grade
corporate bonds are measured primarily using pricing data
from external pricing services and broker quotations, where
available, prices observed from recently executed market
transactions and bond spreads. Investment grade corporate
bonds measured using these valuation methods are
categorized within Level 2 of the fair value hierarchy. If broker
quotes, pricing data or spread data is not available, alternative
valuation techniques may be used. Investment grade corporate
bonds measured using alternative valuation techniques are
categorized within Level 2 or Level 3 of the fair value hierarchy.
•High Yield Corporate and Convertible Bonds: A significant
portion of our high yield corporate and convertible bonds are
categorized within Level 2 of the fair value hierarchy and are
measured primarily using broker quotations and pricing data
from external pricing services, where available, and prices
observed from recently executed market transactions of
institutional size. Where pricing data is less observable,
valuations are categorized within Level 3 of the fair value
hierarchy and are based on pending transactions involving the
issuer or comparable issuers, prices implied from an issuer’s
subsequent financing or recapitalization, models incorporating
financial ratios and projected cash flows of the issuer and
market prices for comparable issuers.
Collateralized Debt Obligations and Collateralized Loan
Obligations
Collateralized debt obligations (“CDOs”) and collateralized loan
obligations (“CLOs”) are measured based on prices observed
from recently executed market transactions of the same or
similar security or based on valuations received from third-party
brokers or data providers and are categorized within Level 2 or
Level 3 of the fair value hierarchy depending on the observability
and significance of the pricing inputs. Valuation that is based on
recently executed market transactions of similar securities
incorporates additional review and analysis of pricing inputs and
comparability criteria, including, but not limited to, collateral type,
tranche type, rating, origination year, prepayment rates, default
rates and loss severity.
U.S. Government and Federal Agency Securities
•U.S. Treasury Securities: U.S. Treasury securities are measured
based on quoted market prices obtained from external pricing
services and categorized within Level 1 of the fair value
hierarchy.
•U.S. Agency Debt Securities: Callable and non-callable U.S.
agency debt securities are measured primarily based on
quoted market prices obtained from external pricing services
and are generally categorized within Level 1 or Level 2 of the
fair value hierarchy.
Municipal Securities
Municipal securities are measured based on quoted prices
obtained from external pricing services, where available, or
recently executed independent transactions of comparable size
and are generally categorized within Level 2 of the fair value
hierarchy.
Sovereign Obligations
Sovereign government obligations are measured based on
quoted market prices obtained from external pricing services,
where available, or recently executed independent transactions of
comparable size. Sovereign government obligations, with
consideration given to the country of issuance, are generally
categorized within Level 1 or Level 2 of the fair value hierarchy.
Residential Mortgage-Backed Securities
•Agency Residential Mortgage-Backed Securities (“RMBS”):
Agency RMBS include mortgage pass-through securities (fixed
and adjustable rate), collateralized mortgage obligations and
principal-only and interest-only (including inverse interest-only)
securities. Agency RMBS are generally measured using recent
transactions, pricing data from external pricing services or
expected future cash flow techniques that incorporate
prepayment models and other prepayment assumptions to
amortize the underlying mortgage loan collateral and are
categorized within Level 2 or Level 3 of the fair value hierarchy.
We use prices observed from recently executed transactions to
develop market-clearing spread and yield assumptions.
Valuation inputs with regard to the underlying collateral
incorporate factors such as weighted average coupon, loan-to-
value, credit scores, geographic location, maximum and
average loan size, originator, servicer and weighted average
loan age.
•Non-Agency RMBS: The fair value of non-agency RMBS is
determined primarily using pricing data from external pricing
services, where available, and discounted cash flow
methodologies and securities are categorized within Level 2 or
Level 3 of the fair value hierarchy based on the observability
and significance of the pricing inputs used. Performance
attributes of the underlying mortgage loans are evaluated to
estimate pricing inputs, such as prepayment rates, default
rates and the severity of credit losses. Attributes of the
underlying mortgage loans that affect the pricing inputs
include, but are not limited to, weighted average coupon;
average and maximum loan size; loan-to-value; credit scores;
documentation type; geographic location; weighted average
loan age; originator; servicer; historical prepayment, default
and loss severity experience of the mortgage loan pool; and
delinquency rate. Yield curves used in the discounted cash flow
models are based on observed market prices for comparable
securities and published interest rate data to estimate market
yields. In addition, broker quotes, where available, are also
referenced to compare prices.
Commercial Mortgage-Backed Securities
•Agency Commercial Mortgage-Backed Securities (“CMBS”):
Government National Mortgage Association (“Ginnie Mae”)
project loan bonds are measured based on inputs corroborated
from and benchmarked to observed prices of recent
securitization transactions of similar securities with
adjustments incorporating an evaluation of various factors,
including prepayment speeds, default rates and cash flow
structures. Federal National Mortgage Association (“Fannie
Mae”) Delegated Underwriting and Servicing (“DUS”) mortgage-
backed securities are generally measured by using prices
observed from recently executed market transactions to
estimate market-clearing spread levels for purposes of
estimating fair value. Ginnie Mae project loan bonds and
Fannie Mae DUS mortgage-backed securities are categorized
within Level 2 of the fair value hierarchy.
•Non-Agency CMBS: Non-agency CMBS are measured using
pricing data obtained from external pricing services, prices
observed from recently executed market transactions or based
on expected cash flow models that incorporate underlying loan
collateral characteristics and performance. Non-Agency CMBS
are categorized within Level 2 or Level 3 of the fair value
hierarchy depending on the observability of the underlying
inputs.
Other Asset-Backed Securities
Other asset-backed securities (“ABS”) include, but are not limited
to, securities backed by auto loans, credit card receivables,
student loans and other consumer loans and are categorized
within Level 2 or Level 3 of the fair value hierarchy. Valuations are
primarily determined using pricing data obtained from external
pricing services, broker quotes and prices observed from recently
executed market transactions. In addition, recent transaction
data from comparable deals is deployed to develop market
clearing yields and cumulative loss assumptions. The cumulative
loss assumptions are based on the analysis of the underlying
collateral and comparisons to earlier deals with similar collateral
to gauge the relative performance of the deal.
Loans and Other Receivables
•Corporate Loans: Corporate loans categorized within Level 2 of
the fair value hierarchy are measured based on market
consensus pricing service quotations. Where available, market
price quotations from external pricing services are reviewed to
ensure they are supported by transaction data. Corporate loans
categorized within Level 3 of the fair value hierarchy are
measured based on price quotations that are considered to be
less transparent. Price quotations are derived using market
prices for debt securities of the same creditor and estimates of
future cash flows. Future cash flows use assumptions
regarding creditor default and recovery rates, credit rating,
effective yield and consideration of the issuer’s capital
structure.
•Participation Certificates in Agency Residential Loans:
Valuations of participation certificates in agency residential
loans are based on observed market prices of recently
executed purchases and sales of similar loans and data
provider pricing. The loan participation certificates are
categorized within Level 2 of the fair value hierarchy given the
observability and volume of recently executed transactions and
availability of data provider pricing.
•Project Loans and Participation Certificates in Ginnie Mae
Project and Construction Loans: Valuations of participation
certificates in Ginnie Mae project and construction loans are
based on inputs corroborated from and benchmarked to
observed prices of recent securitizations with similar
underlying loan collateral to derive an implied spread.
Securitization prices are adjusted to estimate the fair value of
the loans to account for the arbitrage that is realized at the
time of securitization. The measurements are categorized
within Level 2 of the fair value hierarchy given the observability
and volume of recently executed transactions.
•Consumer Loans and Funding Facilities: Consumer and small
business whole loans and related funding facilities are valued
based on observed market transactions and incorporating
valuation inputs including, but not limited to, delinquency and
default rates, prepayment rates, borrower characteristics, loan
risk grades and loan age. These assets are categorized within
Level 2 or Level 3 of the fair value hierarchy.
•Escrow and Claim Receivables: Escrow and claim receivables
are categorized within Level 2 of the fair value hierarchy where
fair value is based on recent observations in the same
receivable. Escrow and claim receivables are categorized
within Level 3 of the fair value hierarchy where fair value is
estimated based on reference to market prices and implied
yields of debt securities of the same or similar issuers.
Derivatives
•Listed Derivative Contracts: Listed derivative contracts that are
actively traded are measured based on quoted exchange
prices, broker quotes or vanilla option valuation models, such
as Black-Scholes, using observable valuation inputs from the
principal market or consensus pricing services. Exchange
quotes and/or valuation inputs are generally obtained from
external vendors and pricing services. Broker quotes are
validated directly through observable and tradeable quotes.
Listed derivative contracts that use exchange close prices are
generally categorized within Level 1 of the fair value hierarchy.
All other listed derivative contracts are generally categorized
within Level 2 of the fair value hierarchy.
•Over-the-Counter (“OTC”) Derivative Contracts: OTC derivative
contracts are generally valued using models, whose inputs
reflect assumptions that we believe market participants would
use in valuing the derivative in a current transaction. Where
available, valuation inputs are calibrated from observable
market data. For many OTC derivative contracts, the valuation
models do not involve material subjectivity as the
methodologies do not entail significant judgment and the
inputs to valuation models do not involve a high degree of
subjectivity as the valuation model inputs are readily
observable or can be derived from actively quoted markets.
OTC derivative contracts are primarily categorized within Level
2 of the fair value hierarchy given the observability and
significance of the inputs to the valuation models. Where
significant inputs to the valuation are unobservable, derivative
instruments are categorized within Level 3 of the fair value
hierarchy.
OTC options include OTC equity, foreign exchange, interest rate
and commodity options measured using various valuation
models, such as Black-Scholes, with key inputs including the
underlying security price, foreign exchange spot rate,
commodity price, implied volatility, dividend yield, interest rate
curve, strike price and maturity date. Discounted cash flow
models are utilized to measure certain OTC derivative
contracts including the valuations of our interest rate swaps,
which incorporate observable inputs related to interest rate
curves, valuations of our foreign exchange forwards and
swaps, which incorporate observable inputs related to foreign
currency spot rates and forward curves and valuations of our
commodity swaps and forwards, which incorporate observable
inputs related to commodity spot prices and forward curves.
Credit default swaps include both index and single-name credit
default swaps. Where available, external data is used in
measuring index credit default swaps and single-name credit
default swaps. For commodity and equity total return swaps,
market prices are generally observable for the underlying asset
and used as the basis for measuring the fair value of the
derivative contracts. Total return swaps executed on other
underlyings are measured based on valuations received from
external pricing services.
Securities Received as Collateral / Obligations to Return Securities
Received as Collateral
In connection with securities-for-securities transactions in which
we are the lender of securities and are permitted to sell or
repledge the securities received as collateral, we report the fair
value of the collateral received and the related obligation to
return the collateral. Valuation is based on the price of the
underlying security and is categorized within the corresponding
leveling guidance above. These financial instruments are typically
categorized within Level 1 of the fair value hierarchy.
Other Secured Financings
Other secured financings that are accounted for at fair value are
classified within Level 2 or Level 3 of the fair value hierarchy. Fair
value is based on estimates of future cash flows incorporating
assumptions regarding recovery rates.
Long-term Debt
Long-term debt includes variable rate, fixed-to-floating rate,
equity-linked notes, constant maturity swap, digital, callable,
collared floating rate and Bermudan structured notes. These are
valued using various valuation models that incorporate our own
credit spread, market price quotations from external pricing
sources referencing the appropriate interest rate curves,
volatilities and other inputs as well as prices for transactions in a
given note during the period. Long-term debt notes are generally
categorized within Level 2 of the fair value hierarchy where
market trades have been observed during the period or model
pricing is available, otherwise the notes are categorized within
Level 3.
Investments at Fair Value
Investments at fair value includes investments in hedge funds
and private equity funds, which are measured at the NAV of the
funds, provided by the fund managers and are excluded from the
fair value hierarchy. Investments at fair value also include direct
equity investments in private companies, which are measured at
fair value using valuation techniques involving quoted prices of or
market data for comparable companies, similar company ratios
and multiples (e.g., price/EBITDA, price/book value), discounted
cash flow analyses and transaction prices observed for
subsequent financing or capital issuance by the company. Direct
equity investments in private companies are categorized within
Level 2 or Level 3 of the fair value hierarchy.
Information about our investments in entities that have the
characteristics of an investment company:
November 30, 2024
$ in thousands
Fair Value
(1)
Unfunded
Commitments
Redemption
Frequency
Redemption
Notice Period
Equity Long/
Short Hedge
Funds (2) ............
$280,364
$—
Quarterly (100%)
45 - 90 days
Equity Funds (3)
60,215
30,530
N/R (100%)
N/R
Commodity
Fund (4) ..............
21,149
—
Quarterly (100%)
60 days
Multi-asset
Funds (5) ............
359,207
—
Monthly (86%)
Quarterly (14%)
45 - 60 days
90 days
Other Funds (6) .
531,754
263,250
Quarterly (70%)
Monthly (2%)
N/R (28%)
90 days
30 days
N/R
Total ...................
$1,252,689
$293,780
November 30, 2023
$ in thousands
Fair Value
(1)
Unfunded
Commitments
Redemption
Frequency
Redemption
Notice Period
Equity Long/
Short Hedge
Funds (2) ............
$341,530
$—
Quarterly (57%)
N/R (43%)
60 - 90 days
Equity Funds (3)
55,701
37,534
N/R (100%)
N/R
Commodity
Fund (4) ..............
21,747
—
Quarterly (100%)
60 days
Multi-asset
Funds (5) ............
357,445
—
Monthly (83%)
Quarterly (13%)
N/R (4%)
60 days
90 days
N/R
Other Funds (6) .
432,960
132,662
Quarterly (75%)
N/R (25%)
90 days
N/R
Total ...................
$1,209,383
$170,196
N/R - Not redeemable
(1)Where fair value is calculated based on NAV, fair value has been derived from
each of the funds’ capital statements.
(2)Includes investments in hedge funds that invest, long and short, primarily in
both public and private equity securities in domestic and international
markets. The non-redeemable investments at November 30, 2023 included
restrictions before November 30, 2023 or August 31, 2025.
(3)Includes investments in equity funds that invest in the equity of various U.S.
and foreign private companies in a broad range of industries. These
investments cannot be redeemed; instead, distributions are received through
the liquidation of the underlying assets of the funds which are primarily
expected to be liquidated in approximately one to ten years.
(4)Includes investments in a hedge fund that invests, long and short, primarily in
commodities.
(5)Includes investments in hedge funds that invest, long and short, primarily in
multi-asset securities in domestic and international markets in both the public
and private sectors. The non-redeemable investments at November 30, 2023
included restrictions before April, 1 2024.
(6)Primarily includes investments in a fund that invests in short-term trade
receivables and payables that are expected to generally be outstanding
between 90 to 120 days and short-term credit instruments, as well as
investments in a fund that invests, long and short, in distressed and special
situations credit strategies across sectors and asset typesLevel 3 Rollforwards
Changes in fair value of our financial assets and liabilities that have been categorized within Level 3 of the fair value hierarchy for the
year ended November 30, 2024:
For instruments still held at
November 30, 2024, changes
in unrealized gains/(losses)
included in:
$ in thousands
Balance at
November 30,
2023
Total gains/
losses
(realized
and
unrealized)
(1)
Purchases
Sales
Settlements
Issuances
Net
transfers
into/
(out of)
Level 3
Balance at
November 30,
2024
Earnings (1)
Other
comprehensive
income (1)
Assets:
Financial instruments
owned:
Corporate equity securities ...
$181,294
$(4,616)
$50,297
$(524)
$—
$—
$12,913
$239,364
$(11,748)
$—
Corporate debt securities ......
26,112
(4,442)
16,219
(7,307)
(400)
—
(5,251)
24,931
(19,872)
—
CDOs and CLOs .......................
64,862
(6,194)
34,964
(21,963)
(2,198)
—
(5,495)
63,976
(2,437)
—
Sovereign obligations .............
—
—
172
—
—
—
—
172
172
—
RMBS ........................................
20,871
(669)
6,874
(5,384)
(51)
—
(13,927)
7,714
(395)
—
CMBS ........................................
508
(31)
—
—
—
—
—
477
(64)
—
Other ABS .................................
117,661
(22,251)
63,704
(74,139)
(10,284)
—
28,523
103,214
(17,242)
—
Loans and other receivables .
130,101
(1,664)
79,399
(41,551)
(20,523)
—
6,824
152,586
(22,108)
—
Investments at fair value .......
130,835
(12,142)
19,726
—
(547)
—
(7)
137,865
(12,142)
—
Liabilities:
Financial instruments sold,
not yet purchased:
Corporate equity securities ...
$676
$682
$(1,150)
$—
$—
$—
$—
$208
$3
$—
Corporate debt securities ......
124
(3)
—
—
(1,100)
—
1,144
165
105
—
CMBS ........................................
840
(1)
(245)
560
—
—
(1)
1,153
1
—
Loans ........................................
1,521
(148)
(1,443)
16,946
—
—
(12)
16,864
125
—
Net derivatives (2) ...................
50,955
(9,648)
—
—
(12,298)
3,766
(10,489)
22,286
8,110
—
Other secured financings .......
3,898
4,482
—
—
(4,415)
10,919
—
14,884
(4,482)
Long-term debt ........................
744,597
51,747
—
—
(2,109)
28,614
(946)
821,903
(37,526)
(28,442)
(1)Realized and unrealized gains/losses are primarily reported in Principal transactions revenues. Changes in instrument-specific credit risk related to structured notes
within Long-term debt are presented net of tax in our Consolidated Statements of Comprehensive Income.
(2)Net derivatives represent Financial instruments owned—Derivatives and Financial instruments sold, not yet purchased —Derivatives.
Analysis of Level 3 Assets and Liabilities for the Year Ended
November 30, 2024
Transfers of assets of $90.5 million from Level 2 to Level 3 of the
fair value hierarchy are primarily attributed to:
•Other ABS of $47.6 million, corporate equity securities of $22.7
million, loans and other receivables of $14.9 million, CDOs and
CLOs of $2.7 million and corporate debt securities of $2.0
million due to reduced pricing transparency.
Transfers of assets of $66.9 million from Level 3 to Level 2 are
primarily attributed to:
•Other ABS of $19.0 million, RMBS of $14.6 million, corporate
equity securities of $9.7 million, CDOs and CLOs of $8.2 million
and loans and other receivables of $8.1 million due to greater
pricing transparency.
Transfers of liabilities of $30.1 million from Level 2 to Level 3 of
the fair value hierarchy are primarily attributed to:
•Structured notes within long-term debt of $26.8 million and net
derivatives of $3.1 million due to reduced pricing and market
transparency.
Transfers of liabilities of $40.4 million from Level 3 to Level 2 of
the fair value hierarchy are primarily attributed to:
•Structured notes within long-term debt of $27.8 million and net
derivatives of $13.6 million due to greater pricing and market
transparency.
Net losses on Level 3 assets were $52.0 million and net losses
on Level 3 liabilities were $47.1 million for the year ended
November 30, 2024. Net losses on Level 3 assets were primarily
due to decreased market values in loans and other receivables,
other ABS, investments at fair value, CDOs and CLOs, corporate
equity securities and corporate debt securities. Net losses on
Level 3 liabilities were primarily due to increased market
valuations of certain structured notes within long-term debt and
other secured financings, partially offset by decreases in certain
derivatives.
Changes in fair value of our financial assets and liabilities that have been categorized within Level 3 of the fair value hierarchy for the
year ended November 30, 2023:
For instruments still held at
November 30, 2023, changes in
unrealized gains/(losses)
included in:
$ in thousands
Balance at
November 30,
2022
Total gains/
losses
(realized
and
unrealized)
(1)
Purchases
Sales
Settlements
Issuances
Net
transfers
into/
(out of)
Level 3
Balance at
November 30,
2023
Earnings (1)
Other
comprehensive
income (1)
Assets:
Financial instruments
owned:
Corporate equity
securities .......................
$240,347
$(65,037)
$7,865
$(1,228)
$—
$—
$(653)
$181,294
$(11,007)
$—
Corporate debt securities
30,232
1,749
4,132
(18,325)
(200)
—
8,524
26,112
(703)
—
CDOs and CLOs .................
55,824
31,218
51,632
(3,199)
(56,624)
—
(13,989)
64,862
(10,774)
—
RMBS ..................................
27,617
(5,709)
10
—
(247)
—
(800)
20,871
(1,775)
—
CMBS ..................................
839
(331)
—
—
—
—
—
508
(327)
—
Other ABS ...........................
94,677
(17,800)
71,261
(37,088)
(26,936)
—
33,547
117,661
(20,678)
—
Loans and other
receivables ....................
168,875
10,995
55,520
(42,999)
(46,383)
—
(15,907)
130,101
4,168
—
Investments at fair value .
161,992
83,382
8,852
(15,080)
(107,963)
—
(348)
130,835
(5,762)
—
Liabilities:
Financial instruments
sold, not yet
purchased:
Corporate equity
securities .......................
$750
$348
$(1,477)
$1,055
$—
$—
$—
$676
$284
$—
Corporate debt securities
500
(35)
(187)
—
—
—
(154)
124
29
—
CMBS ..................................
490
—
—
350
—
—
—
840
—
—
Loans ..................................
3,164
(114)
(1,655)
126
—
—
—
1,521
(992)
—
Net derivatives (2) .............
59,524
(10,405)
(527)
170
(3,496)
2,158
3,531
50,955
6,760
—
Other secured financings .
1,712
2,186
—
—
—
—
—
3,898
(2,186)
—
Long-term debt ..................
661,123
70,945
—
—
—
17,140
(4,611)
744,597
(28,327)
(59,706)
(1)Realized and unrealized gains/losses are primarily reported in Principal transactions revenues. Changes in instrument-specific credit risk related to structured notes
within Long-term debt are presented net of tax in our Consolidated Statements of Comprehensive Income.
(2)Net derivatives represent Financial instruments owned—Derivatives and Financial instruments sold, not yet purchased—Derivatives.
Analysis of Level 3 Assets and Liabilities for the Year Ended
November 30, 2023
Transfers of assets of $88.5 million from Level 2 to Level 3 of the
fair value hierarchy are primarily attributed to:
•Other ABS of $57.8 million, loans and other receivables of
$16.5 million, corporate debt securities of $8.9 million and
corporate equity securities of $5.3 million due to reduced
pricing transparency.
Transfers of assets of $78.2 million from Level 3 to Level 2 are
primarily attributed to:
•Loans and other receivables of $32.4 million, other ABS of
$24.3 million, CDOs and CLOs of $14.0 million and corporate
equity securities of $6.0 million due to greater pricing
transparency supporting classification into Level 2.
Transfers of liabilities of $60.8 million from Level 2 to Level 3 of
the fair value hierarchy are primarily attributed to:
•Net derivatives of $35.6 million and structured notes within
long-term debt of $25.2 million due to reduced pricing and
market transparency.
Transfers of liabilities of $62.0 million from Level 3 to Level 2 of
the fair value hierarchy are primarily attributed to:
•Net derivatives of $32.0 million and structured notes within
long-term debt of $29.8 million due to greater pricing and
market transparency.
Net gains on Level 3 assets were $38.5 million and net losses on
Level 3 liabilities were $62.9 million for the year ended November
30, 2023. Net gains on Level 3 assets were primarily due to
increased market values in investments at fair value, CDOs and
CLOs and loans and other receivables, partially offset by
decreases in corporate equity securities and other ABS. Net
losses on Level 3 liabilities were primarily due to increased
market valuations of certain structured notes within long-term
debt, partially offset by decreases in certain derivatives.
Changes in fair value of our financial assets and liabilities that have been categorized within Level 3 of the fair value hierarchy for the
year ended November 30, 2022:
For instruments still held at
November 30, 2022, changes
in unrealized gains/(losses)
included in:
$ in thousands
Balance at
November 30,
2021
Total gains/
losses
(realized
and
unrealized)
(1)
Purchases
Sales
Settlements
Issuances
Net
transfers
into/
(out of)
Level 3
Balance at
November 30,
2022
Earnings (1)
Other
comprehensive
income (1)
Assets:
Financial instruments
owned:
Corporate equity
securities .......................
$118,489
$(645)
$171,700
$(62,474)
$(298)
$—
$13,575
$240,347
$7,286
$—
Corporate debt securities
11,803
946
18,686
(23,964)
(9)
—
22,770
30,232
(2,087)
—
CDOs and CLOs .................
31,946
7,099
44,995
(22,600)
(16,634)
—
11,018
55,824
(10,938)
—
RMBS ..................................
1,477
(13,210)
35,774
(372)
(240)
—
4,188
27,617
(7,728)
—
CMBS ..................................
2,333
(733)
—
(749)
—
—
(12)
839
(703)
—
Other ABS ...........................
93,524
(6,467)
74,353
(20,362)
(39,647)
—
(6,724)
94,677
(26,982)
Loans and other
receivables ....................
178,417
(1,912)
45,536
(33,692)
(48,218)
—
28,744
168,875
(11,610)
—
Investments, at fair value .
154,373
46,735
74,984
(74,742)
(15,951)
—
(23,407)
161,992
33,294
—
Liabilities:
Financial instruments
sold, not yet
purchased:
Corporate equity
securities .......................
$4,635
$(3,611)
$(815)
$4,858
$—
$—
$(4,317)
$750
$2,382
$—
Corporate debt securities
482
88
(70)
—
—
—
—
500
(88)
—
CMBS ..................................
210
—
—
280
—
—
—
490
—
—
Loans ..................................
9,925
1,197
(5,173)
—
96
—
(2,881)
3,164
(2,484)
—
Net derivatives (2) .............
67,769
(181,750)
(1,559)
1,285
—
28,436
145,343
59,524
168,304
—
Other secured financings .
25,905
(650)
—
—
(23,543)
—
—
1,712
650
—
Long-term debt ..................
881,732
(280,967)
—
—
(3,919)
83,874
(19,597)
661,123
239,400
41,567
(1)Realized and unrealized gains/losses are primarily reported in Principal transactions revenues. Changes in instrument-specific credit risk related to structured notes
within long-term debt are presented net of tax in our Consolidated Statements of Comprehensive Income.
(2)Net derivatives represent Financial instruments owned—Derivatives and Financial instruments sold, not yet purchased —Derivatives.
Analysis of Level 3 Assets and Liabilities for the Year Ended
November 30, 2022
Transfers of assets of $111.7 million from Level 2 to Level 3 of
the fair value hierarchy are primarily attributed to:
•Loans and other receivables of $33.2 million, corporate debt
securities of $22.8 million, other ABS of $22.6 million,
corporate equity securities of $17.9 million and CDOs and
CLOs of $11.0 million due to reduced price transparency.
Transfers of assets of $61.5 million from Level 3 to Level 2 are
primarily attributed to:
•Other ABS of $29.3 million, investments at fair value of $23.4
million, loans and other receivables of $4.5 million and
corporate equity securities of $4.3 million due to greater
pricing transparency supporting classification into Level 2.
Transfers of liabilities of $172.1 million from Level 2 to Level 3
are primarily attributed to:
•Net derivatives of $152.8 million and structured notes within
long-term debt of $19.3 million due to reduced pricing and
market transparency.
Transfers of liabilities of $53.6 million from Level 3 to Level 2 are
primarily attributed to:
•Structured notes within long-term debt of $38.9 million, net
derivatives of $7.5 million and corporate equity securities of
$4.3 million due to greater pricing transparency.
Net gains on Level 3 assets were $31.8 million and net gains on
Level 3 liabilities were $465.7 million for the year ended
November 30, 2022. Net gains on Level 3 assets were primarily
due to increased market values in investments at fair value and
CDOs and CLOs, partially offset by decreases in RMBS and Other
ABS. Net gains on Level 3 liabilities were primarily due to
decreased market valuations of certain structured notes within
long-term debt and certain derivatives.
Significant Unobservable Inputs used in Level 3 Fair Value
Measurements
The tables below present information on the valuation
techniques, significant unobservable inputs and their ranges for
our financial assets and liabilities, subject to threshold levels
related to the market value of the positions held, measured at fair
value on a recurring basis with a significant Level 3 balance. The
range of unobservable inputs could differ significantly across
different firms given the range of products across different firms
in the financial services sector. The inputs are not representative
of the inputs that could have been used in the valuation of any
one financial instrument (i.e., the input used for valuing one
financial instrument within a particular class of financial
instruments may not be appropriate for valuing other financial
instruments within that given class). Additionally, the ranges of
inputs presented below should not be construed to represent
uncertainty regarding the fair values of our financial instruments;
rather, the range of inputs is reflective of the differences in the
underlying characteristics of the financial instruments in each
category.
For certain categories, we have provided a weighted average of
the inputs allocated based on the fair values of the financial
instruments comprising the category. We do not believe that the
range or weighted average of the inputs is indicative of the
reasonableness of uncertainty of our Level 3 fair values. The
range and weighted average are driven by the individual financial
instruments within each category and their relative distribution in
the population. The disclosed inputs when compared to the
inputs as disclosed in other periods should not be expected to
necessarily be indicative of changes in our estimates of
unobservable inputs for a particular financial instrument as the
population of financial instruments comprising the category will
vary from period to period based on purchases and sales of
financial instruments during the period as well as transfers into
and out of Level 3 each period.
November 30, 2024
Financial Instruments Owned
Fair Value
(in
thousands)
Valuation
Technique
Significant Unobservable Input(s)
Input / Range
Weighted
Average
Corporate equity securities .....................
$239,364
Non-exchange-traded securities
Market approach
Price
$0
-
$486
$68
Corporate debt securities ........................
$24,931
Market approach
Price
$28
-
$105
$74
CDOs and CLOs ..........................................
$53,388
Discounted cash
flows
Constant prepayment rate
20%
—
Constant default rate
2%
—
Loss severity
30%
—
Discount rate/yield
14%
-
32%
26%
Market approach
Price
$70
-
$106
$94
RMBS
$7,714
Discounted cash
flows
Constant prepayment rate
20%
—
Loss severity
10%
—
Discount rate/yield
12%
—
Other ABS ...................................................
$98,172
Discounted cash
flows
Discount rate/yield
19%
-
30%
25%
Cumulative loss rate
17%
-
34%
24%
Duration (years)
0.9
-
1.0
0.9
Market approach
Price
$106
-
$127
$121
Scenario analysis
Estimated recovery percentage
92%
—
Loans and other receivables ...................
$152,586
Market approach
Price
$17
-
$106
$75
Scenario analysis
Estimated recovery percentage
3%
-
252%
50%
Derivatives ..................................................
$1,396
Embedded options
Market approach
Basis points upfront
0.3
—
Investments at fair value ..........................
$132,769
Private equity securities
Market approach
Price
$1
-
$8,506
$501
Discount rate/yield
28%
—
Revenue
$29,908,372
—
Financial Instruments Sold, Not Yet Purchased:
Loans ..........................................................
$16,864
Market approach
Price
$17
-
$100
$75
Scenario analysis
Estimated recovery percentage
0%
-
205%
50%
Derivatives ..................................................
$25,045
Equity options
Volatility
benchmarking
Volatility
28%
-
102%
49%
Options
Market approach
Basis points upfront
8.0
-
22.3
14.9
Other secured financings .........................
$14,884
Scenario analysis
Estimated recovery percentage
60%
-
100%
93%
Market approach
Price
$117
—
Long-term debt ..........................................
$821,903
Structured notes
Market approach
Price
$61
-
$122
$96
November 30, 2023
Financial Instruments Owned
Fair Value
(in
thousands)
Valuation
Technique
Significant Unobservable Input(s)
Input / Range
Weighted
Average
Corporate equity securities .....................
$181,294
Non-exchange-traded securities
Market approach
Price
$0
-
$325
$59
Corporate debt securities ........................
$26,112
Market approach
Price
$40
-
$94
$50
Discounted cash
flow
Discount rate/yield
11%
—
Scenario analysis
Estimated recovery percentage
4%
—
CDOs and CLOs ..........................................
$64,862
Discounted cash
flows
Constant prepayment rate
15%
-
20%
19
Constant default rate
2%
—
Loss severity
35%
-
40%
36%
Discount rate/yield
21%
-
26%
24%
Market approach
Price
$48
-
$100
$88
CMBS ...........................................................
$508
Scenario analysis
Estimated recovery percentage
28%
—
Other ABS ...................................................
$102,423
Discounted cash
flows
Discount rate/yield
10%
-
21%
18%
Cumulative loss rate
9%
-
32%
25%
Duration (years)
1.1
-
2.2
1.7
Market approach
Price
$100
—
Loans and other receivables ...................
$130,101
Market approach
Price
$82
-
$157
$127
Scenario analysis
Estimated recovery percentage
7%
-
73%
40%
Derivatives
$2,395
Equity options
Volatility
benchmarking
Volatility
60%
—
Investments at fair value ..........................
$127,237
Private equity securities
Market approach
Price
$1
-
$6,819
$484
Discount rate/yield
28%
—
Revenue
$30,538,979
—
Financial Instruments Sold, Not Yet Purchased:
Corporate debt securities
$124
Scenario analysis
Estimated recovery percentage
4%
—
Loans
$1,521
Market approach
Price
$101
—
Derivatives ..................................................
$56,779
Equity options
Volatility
benchmarking
Volatility
31%
-
87%
42%
Options
Market approach
Basis points upfront
0.4
-
25.5
17.9
Other secured financings .........................
$3,898
Scenario analysis
Estimated recovery percentage
18%
-
73%
53%
Long-term debt ..........................................
$744,597
Structured notes
Market approach
Price
$57
-
$114
$78
Price
€60
-
€103
€84
The fair values of certain Level 3 assets and liabilities that were
determined based on third-party pricing information, unadjusted
past transaction prices or a percentage of the reported enterprise
fair value are excluded from the above tables. At November 30,
2024 and 2023, asset exclusions consisted of $23.9 million and
$45.6 million, respectively, primarily composed of CDOs and
CLOs, Other ABS, Investments at fair value, certain derivatives,
RMBS, CMBS and sovereign obligations. At November 30, 2024
and 2023, liability exclusions consisted of $2.7 million and $4.0
million, respectively, primarily composed of certain derivatives,
loans, CMBS, corporate equity securities and corporate debt
securities.
Uncertainty of Fair Value Measurement from Use of Significant
Unobservable Inputs
For recurring fair value measurements categorized within Level 3
of the fair value hierarchy, the uncertainty of the fair value
measurement due to the use of significant unobservable inputs
and interrelationships between those unobservable inputs (if any)
are described below:
•Non-exchange-traded securities, corporate debt securities,
CDOs and CLOs, loans and other receivables, other ABS, private
equity securities, certain derivatives, other secured financings
and structured notes using a market approach valuation
technique. A significant increase (decrease) in the price of the
private equity securities, nonexchange-traded securities,
corporate debt securities, CDOs and CLOs, other ABS, loans
and other receivables, other secured financings or structured
notes would result in a significantly higher (lower) fair value
measurement. A significant increase (decrease) in the revenue
multiple related to private equity securities would result in a
significantly higher (lower) fair value measurement. A
significant increase (decrease) in the discount rate/security
yield related to private equity securities would result in a
significantly lower (higher) fair value measurement. Depending
on whether we are a receiver or (payer) of basis points upfront,
a significant increase in basis points would result in a
significant increase (decrease) in the fair value measurement
of options.
•Loans and other receivables, corporate debt securities, CMBS,
other ABS and other secured financings using scenario
analysis. A significant increase (decrease) in the possible
recovery rates of the cash flow outcomes underlying the
financial instrument would result in a significantly higher
(lower) fair value measurement for the financial instrument.
•CDOs and CLOs, corporate debt securities, RMBS and other
ABS using a discounted cash flow valuation technique. A
significant increase (decrease) in isolation in the constant
default rate, loss severity or cumulative loss rate would result
in a significantly lower (higher) fair value measurement. The
impact of changes in the constant prepayment rate and
duration would have differing impacts depending on the capital
structure and type of security. A significant increase
(decrease) in the discount rate/security yield would result in a
significantly lower (higher) fair value measurement.
•Derivative equity options using volatility benchmarking. A
significant increase (decrease) in volatility would result in a
significantly higher (lower) fair value measurement.
Fair Value Option Election
We have elected the fair value option for all loans and loan
commitments made by our investment banking and capital
markets businesses. These loans and loan commitments include
loans entered into by our investment banking division in
connection with client bridge financing and loan syndications,
loans purchased by our leveraged credit trading desk as part of
its bank loan trading activities and mortgage and consumer loan
commitments, purchases and fundings in connection with
mortgage-backed and other asset-backed securitization
activities. Loans and loan commitments originated or purchased
by our leveraged credit and mortgage-backed businesses are
managed on a fair value basis. Loans are included in Financial
instruments owned and loan commitments are included in
Financial instruments owned and Financial instruments sold, not
yet purchased. The fair value option election is not applied to
loans made to affiliate entities as such loans are entered into as
part of ongoing, strategic business ventures. Loans to affiliate
entities are included in Investments in and loans to related
parties and are accounted for on an amortized cost basis. We
have also elected the fair value option for certain of our
structured notes which are managed by our investment banking
and capital markets businesses and are included in Long-term
debt. We have elected the fair value option for certain financial
instruments held by subsidiaries as the investments are risk
managed by us on a fair value basis. The fair value option has
been elected for certain other secured financings that arise in
connection with our securitization activities and other structured
financings. Other secured financings, Receivables – Brokers,
dealers and clearing organizations, Receivables – Customers,
Receivables – Fees, interest and other, Payables – Brokers,
dealers and clearing organizations and Payables – Customers,
are accounted for at cost plus accrued interest rather than at fair
value; however, the recorded amounts approximate fair value due
to their liquid or short-term nature.
Gains (losses) due to changes in fair value related to instrument-
specific credit risk on loans, other receivables and debt
instruments and gains (losses) due to other changes in fair value
on Long-term debt measured at fair value under the fair value
option:
Year Ended November 30,
$ in thousands
2024
2023
2022
Financial instruments owned:
Loans and other receivables ..........
$(24,029)
$46,421
$(20,529)
Other secured financings:
Other changes in fair value (2) ......
(4,482)
(2,186)
695
Long-term debt:
Changes in instrument-specific
credit risk (1) ....................................
(32,580)
(106,801)
63,344
Other changes in fair value (2) ......
(115,912)
21,373
345,050
(1)Changes in fair value of structured notes related to instrument-specific credit
risk are presented net of tax in our Consolidated Statements of
Comprehensive Income.
(2)Other changes in fair value are included in Principal transactions revenues.
Amounts by which contractual principal is greater than (less
than) fair value for loans and other receivables, Other secured
financings and Long-term debt measured at fair value under the
fair value option:
November 30,
$ in thousands
2024
2023
Financial instruments owned:
Loans and other receivables (1) ................................
$1,603,512
$2,344,468
Loans and other receivables on nonaccrual status
and/or 90 days or greater past due (1) (2) ...............
132,838
259,354
Long-term debt .............................................................
131,107
294,356
Other secured financings ............................................
459
1,377
(1)Interest income is recognized separately from other changes in fair value and
is included in Interest revenues.
(2)Amounts include loans and other receivables 90 days or greater past due by
which contractual principal exceeds fair value of $48.8 million and $187.4
million at November 30, 2024 and 2023, respectively.
The aggregate fair value of loans and other receivables on
nonaccrual status and/or 90 days or greater past due was $126.9
million and $98.1 million at November 30, 2024 and 2023,
respectively, which includes loans and other receivables 90 days
or greater past due of $120.0 million and $37.6 million at
November 30, 2024 and 2023, respectively.
Assets Measured at Fair Value on a Non-recurring Basis
Certain assets were measured at fair value on a non-recurring
basis and are not included in the tables above. Assets measured
at fair value on a non-recurring basis for which we recognized a
non-recurring fair value adjustment for the periods presented:
November 30, 2024
Level 3
Gains
(Losses)
Premises and equipment (1) .........................................
$—
$(1,323)
Exchange ownership interests and registrations (2) .
—
(10)
Other assets (3) ..............................................................
21,900
21,900
November 30, 2023
Level 3
Gains
(Losses)
Exchange ownership interests and registrations (2) .
$—
$(78)
Investments in and loans to related parties (4) .........
—
(57,248)
Other assets (5) ..............................................................
1,755
(2,101)
November 30, 2022
Level 3
Gains
(Losses)
Exchange ownership interests and registrations (2) .
$—
$(39)
Investments in and loans to related parties (6)
106,172
(27,119)
Other assets (7)
1,709
(6,701)
(1)Premises and equipment losses represent impairments of leasehold
improvements, furniture, fixtures, computer and communications equipment
and capitalized software and were recognized in Technology and
communications and Occupancy and equipment rental in our Consolidated
Statements of Earnings.
(2)These impairment losses, which represent ownership interests in market
exchanges on which trading business is conducted, and registrations, were
recognized in Other expenses and the assets were in the Investment Banking
and Capital Markets reportable business segment. The fair value is based on
observed quoted sales prices for each individual membership. Refer to Note
13, Goodwill and Intangible Assets.
(3)Our shares in Monashee, an equity method investment, were converted to a
newly created class of nonmarketable preferred shares. Our equity method
investment was remeasured in connection with its nonmonetary exchange
into the preferred shares, which are accounted for at cost pursuant to the
measurement alternative subsequent to the nonmonetary exchange. The gain
was recognized in Other revenues and the asset was in the Asset
Management reportable business segment.
(4)These impairment losses, which are related to an equity method investments,
were recognized in Other revenues and the asset was in the Asset
Management reportable business segment. Fair value was based on our best
estimate of what could be recognized in a sale transaction for the investment.
(5)These impairment losses, which are related to real estate held for
development, were recognized in Other revenues and are held in the Asset
Management reportable business segment. Fair value was based on
estimated future cash flows using discounts rates ranging from 10.0% to
14.0%.
(6)These impairment losses, which are related to certain equity method
investments, were recognized in Other revenues and the assets were in the
Asset Management reportable business segment. The fair values were based
on estimated future cash flows using discount rates ranging from 10.0% to
23.0%. Refer to Note 11, Investments.
(7)These impairment losses, which relate to a real estate property, were
recognized in Other expenses and the assets were in the Asset Management
reportable business segment. The fair values were based on estimated future
cash flows discounted at 12.0%.
Financial Instruments Not Measured at Fair Value
Certain of our financial instruments are not carried at fair value
but are recorded at amounts that approximate fair value due to
their liquid or short-term nature and generally negligible credit
risk. These financial assets include Cash and cash equivalents
and Cash and securities segregated and on deposit for regulatory
purposes or deposited with clearing and depository organizations
and would generally be presented within Level 1 of the fair value
hierarchy.
We have equity securities without readily determinable fair
values, which we account for at cost, minus impairment, which
are presented within Other assets and were $21.9 million and
$0.0 million at November 30, 2024 and 2023, respectively. Net
gains (losses) of $0.0 million, $(122.2) million and $3.6 million
were recognized on these investments during the years ended
November 30, 2024, 2023 and 2022, respectively. Impairments
and downward adjustments on these investments during the year
ended November 30, 2023 were $80.3 million. There were no
impairments and downward adjustments on these investments
during the years ended November 30, 2024 and 2022. These
investments would generally be presented within Level 3 of the
fair value hierarchy.