Marketable Securities

9 Months Ended

Sep. 30, 2023

Marketable securities include investments in money market funds and commercial paper classified as cash equivalents, available-for-sale debt securities, investments in SEI-sponsored and non-SEI-sponsored mutual funds, equities, investments in funds sponsored by LSV and securities owned by SIDCO.

Cash Equivalents

Investments in SEI-sponsored and non-SEI-sponsored money market funds and commercial paper classified as cash equivalents had a fair value of $588,227 and $450,240 at September 30, 2023 and December 31, 2022, respectively. There were no material unrealized or realized gains or losses from these investments during the nine months ended September 30, 2023 and 2022. Investments in money market funds and commercial paper are Level 1 assets.

Available for Sale and Equity Securities

Available For Sale and Equity Securities on the accompanying Consolidated Balance Sheets consist of:


	At September 30, 2023
	Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value
Available-for-sale debt securities	$	123,366	$	—	$	(14,430)	$	108,936
SEI-sponsored mutual funds	5,412		37		(43)		5,406
Equities and other mutual funds	5,033		187		—		5,220
	$	133,811	$	224	$	(14,473)	$	119,562


	At December 31, 2022
	Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value
Available-for-sale debt securities	$	129,372	$	—	$	(12,071)	$	117,301
SEI-sponsored mutual funds	6,207		—		(176)		6,031
Equities and other mutual funds	5,026		—		(157)		4,869
	$	140,605	$	—	$	(12,404)	$	128,201

Net unrealized losses at September 30, 2023 of available-for-sale debt securities were $11,111 (net of income tax benefit of $3,319). Net unrealized losses at December 31, 2022 of available-for-sale debt securities were $9,294 (net of income tax benefit of $2,777). These unrealized losses are associated with the Company’s investments in mortgage-backed securities issued by GNMA and were caused by interest rate increases (See Note 4). The contractual cash flows of these securities are guaranteed by an agency of the U.S. government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company's investments. The Company does not intend to sell the investments and it is not likely that the Company will be required to sell the investments before recovery of their amortized cost bases. These net unrealized losses are reported as a separate component of Accumulated other comprehensive loss on the accompanying Consolidated Balance Sheets.

There were gross realized losses of $167 and $521 from available-for-sale debt securities during the nine months ended September 30, 2023 and 2022, respectively. There were no gross realized gains from available-for-sale debt securities during the nine months ended September 30, 2023 and 2022. Realized losses from available-for-sale debt securities, including amounts reclassified from accumulated comprehensive loss, are reflected in Net gain (loss) from investments on the accompanying Consolidated Statements of Operations.

There were gross realized gains of $63 and gross realized losses of $101 from mutual funds and equities during the nine months ended September 30, 2023. There were gross realized gains of $226 and gross realized losses of $714 from mutual funds and equities during the nine months ended September 30, 2022. Gains and losses from mutual funds and equities are reflected in Net (loss) gain from investments on the accompanying Consolidated Statements of Operations.

Investments in Affiliated Funds

The Company has an investment in funds sponsored by LSV. The Company records this investment on the accompanying Consolidated Balance Sheets at fair value. Unrealized gains and losses from the change in fair value of these funds are recognized in Net (loss) gain from investments on the accompanying Consolidated Statements of Operations.

The funds had a fair value of $6,838 and $6,366 at September 30, 2023 and December 31, 2022, respectively. The Company recognized unrealized gains of $66 and unrealized losses of $380 during the three months ended September 30, 2023 and 2022, respectively, from the change in fair value of the funds. The Company recognized unrealized gains of $472 and unrealized losses of $1,296 during the nine months ended September 30, 2023 and 2022, respectively, from the change in fair value of the funds.

Securities Owned

The Company’s broker-dealer subsidiary, SIDCO, has investments in U.S. government agency securities with maturity dates less than one year. These investments are reflected as Securities owned on the accompanying Consolidated Balance Sheets. Due to specialized accounting practices applicable to investments by broker-dealers, the securities are reported at fair value and changes in fair value are recorded in current period earnings. The securities had a fair value of $32,748 and $32,148 at September 30, 2023 and December 31, 2022, respectively. There were no material net gains or losses related to the securities during the three and nine months ended September 30, 2023 and 2022.