XML 29 R19.htm IDEA: XBRL DOCUMENT
v3.23.1

Derivatives | 3 Months Ended
--- | ---
Mar. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives | Derivatives In the normal course of operations, the Company enters into derivative contracts to facilitate client transactions, hedge principal positions and facilitate hedging activities of affiliated companies. These derivative contracts primarily consist of FX swaps, FX/commodities options, futures and forwards. Derivative contracts can be exchange-traded or OTC. Exchange-traded derivatives typically fall within Level 1 or Level 2 of the fair value hierarchy depending on whether they are deemed to be actively traded or not. The Company generally values exchange-traded derivatives using their closing prices. OTC derivatives are valued using market transactions and other market evidence whenever possible, including market-based inputs to models, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. For OTC derivatives that trade in liquid markets, such as forwards, swaps and options, model inputs can generally be verified and model selection does not involve significant management judgment. Such instruments are typically classified within Level 2 of the fair value hierarchy. The Company does not designate any derivative contracts as hedges for accounting purposes. U.S. GAAP guidance requires that an entity recognize all derivative contracts as either assets or liabilities in the unaudited Condensed Consolidated Statements of Financial Condition and measure those instruments at fair value. The fair value of all derivative contracts is recorded on a net-by-counterparty basis where a legal right to offset exists under an enforceable netting agreement. Derivative contracts are recorded as part of “Receivables from broker-dealers, clearing organizations, customers and related broker-dealers” and “Payables to broker-dealers, clearing organizations, customers and related broker-dealers” in the Company’s unaudited Condensed Consolidated Statements of Financial Condition. The fair value of derivative contracts, computed in accordance with the Company’s netting policy, is set forth below (in thousands):
|  | March 31, 2023 |  | December 31, 2022
Derivative contract |  | Assets |  | Liabilities |  | Notional Amounts 1 |  | Assets |  | Liabilities |  | Notional Amounts 1
FX swaps |  | $ | 6,453 |  |  | $ | 5,662 |  |  | $ | 742,441 |  |  | $ | 3,134 |  |  | $ | 5,796 |  |  | $ | 586,020 |
Forwards |  | 564 |  |  | 977 |  |  | 248,746 |  |  | 603 |  |  | 569 |  |  | 197,278 |
Interest rate swaps |  | 28 |  |  | — |  |  | 103,231,849 |  |  | 25 |  |  | — |  |  | 2,114,412 |
Futures |  | — |  |  | 929 |  |  | 4,733,162 |  |  | — |  |  | 1,268 |  |  | 4,253,088 |
Total |  | $ | 7,045 |  |  | $ | 7,568 |  |  | $ | 108,956,198 |  |  | $ | 3,762 |  |  | $ | 7,633 |  |  | $ | 7,150,798 |
____________________________ 1 Notional amounts represent the sum of gross long and short derivative contracts, an indication of the volume of the Company’s derivative activity, and do not represent anticipated losses. Certain of the Company’s FX swaps are with Cantor. See Note 13—“Related Party Transactions,” for additional information related to these transactions. The replacement costs of contracts in a gain position were $7.0 million and $3.8 million, as of March 31, 2023 and December 31, 2022, respectively. The following tables present information about the offsetting of derivative instruments (in thousands):
| March 31, 2023
| Gross Amounts |  | Gross Amounts Offset |  | Net Amounts Presented in the Statements of Financial Condition 1
Assets |  |  |  |  |
FX swaps | $ | 6,994 |  |  | $ | (541) |  |  | $ | 6,453 |
Forwards | 588 |  |  | (24) |  |  | 564 |
Interest rate swaps | 19,710 |  |  | (19,682) |  |  | 28 |
Futures | 47,987 |  |  | (47,987) |  |  | — |
Total derivative assets | $ | 75,279 |  |  | $ | (68,234) |  |  | $ | 7,045 |
Liabilities |  |  |  |  |
FX swaps | $ | 6,203 |  |  | $ | (541) |  |  | $ | 5,662 |
Forwards | 1,001 |  |  | (24) |  |  | 977 |
Futures | 48,916 |  |  | (47,987) |  |  | 929 |
Interest rate swaps | 19,682 |  |  | $ | (19,682) |  |  | — |
Total derivative liabilities | $ | 75,802 |  |  | $ | (68,234) |  |  | $ | 7,568 |
| December 31, 2022
| Gross Amounts |  | Gross Amounts Offset |  | Net Amounts Presented in the Statements of Financial Condition 1
Assets |  |  |  |  |
FX swaps | $ | 3,623 |  |  | $ | (489) |  |  | $ | 3,134 |
Forwards | 746 |  |  | (143) |  |  | 603 |
Interest Rate Swaps | 895 |  |  | (870) |  |  | 25 |
Futures | 64,769 |  |  | (64,769) |  |  | — |
Total derivative assets | $ | 70,033 |  |  | $ | (66,271) |  |  | $ | 3,762 |
Liabilities |  |  |  |  |
FX swaps | $ | 6,285 |  |  | $ | (489) |  |  | $ | 5,796 |
Futures | 66,037 |  |  | (64,769) |  |  | 1,268 |
Forwards | 712 |  |  | (143) |  |  | 569 |
Interest Rate Swaps | 870 |  |  | (870) |  |  | — |
Total derivative liabilities | $ | 73,904 |  |  | $ | (66,271) |  |  | $ | 7,633 |
____________________________ 1 There were no additional balances in gross amounts not offset as of either March 31, 2023 or December 31, 2022. The change in fair value of derivative contracts is reported as part of “Principal transactions” in the Company’s unaudited Condensed Consolidated Statements of Operations. The table below summarizes gains and (losses) on derivative contracts (in thousands):
|  | Three Months Ended March 31, |  |
Derivative contract |  | 2023 |  | 2022 |  |  |  |
Futures |  | $ | 3,421 |  |  | $ | 4,409 |  |  |  |  |
FX swaps |  | 770 |  |  | 329 |  |  |  |  |
FX/commodities options |  | 41 |  |  | 100 |  |  |  |  |
Interest rate swaps |  | 28 |  |  | — |  |  |  |  |
Gains, net |  | $ | 4,260 |  |  | $ | 4,838 |  |  |  |  |

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI https://asc.fasb.org/topic&trid=2229140 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 40 -Section 50 -Paragraph 5 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126731327&loc=d3e90205-114008 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration