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Revenue Recognition
 6 Months Ended
Jun. 30, 2024
Revenue Recognition [Abstract]  
Revenue Recognition

14. Revenue Recognition

 

Refer to Note 2 – Summary of Significant Accounting Policies in Company’s 2023 Form 10-K for detail on the Company’s primary sources of revenue and the corresponding accounting treatment. Information related to items that impact certain revenue streams within the periods presented is shown below.

 

Principal Transactions and Proprietary Trading

 

The Company continuously invests in treasury bill and treasury notes as part of its normal operations to meet deposit requirements, which are primarily in the line item “Cash and securities segregated for regulatory purposes” on the statements of financial condition, in order to enhance its yield on its excess 15c3-3 deposits. During 2022, there was an increase in U.S. government securities yields, which created an unrealized loss on the Company’s U.S. government securities portfolio. In 2023, the Company recorded substantially all of the reversal of the unrealized loss resulting in a realized and unrealized gain due to the securities coming closer to maturity. Refer to Note 7 – Fair Value Measurements for additional detail.

 

The following table represents detail related to principal transactions and proprietary trading.

 

   Three Months Ended June 30, 2024 
   2024   2023   Increase (Decrease) 
Principal transactions and proprietary trading            
Realized and unrealized gain on primarily riskless principal transactions  $3,480,000   $2,186,000   $1,294,000 
Realized and unrealized gain on portfolio of U.S. government securities   94,000    468,000    (374,000)
Total Principal transactions and proprietary trading  $3,574,000   $2,654,000   $920,000 

 

   Six Months Ended June 30, 2024 
   2024   2023   Increase (Decrease) 
Principal transactions and proprietary trading            
Realized and unrealized gain on primarily riskless principal transactions  $6,923,000   $3,985,000   $2,938,000 
Realized and unrealized gain on portfolio of U.S. government securities   157,000    1,469,000    (1,312,000)
Total Principal transactions and proprietary trading  $7,080,000   $5,454,000   $1,626,000 

 

Stock Borrow / Stock Loan

 

For the three months ended June 30, 2024 and 2023, stock borrow / stock loan revenue was $4,696,000 ($10,482,000 gross revenue less $5,786,000 expenses) and $4,513,000 ($11,524,000 gross revenue less $7,011,000 expenses), respectively. For the six months ended June 30, 2024 and 2023, stock borrow / stock loan revenue was $8,794,000 ($21,372,000 gross revenue less $12,578,000 expenses) and $7,955,000 ($21,300,000 gross revenue less $13,345,000 expenses), respectively.

 

Interest, Marketing and Distribution Fees

 

For the three months ended June 30, 2024 and 2023, interest, marketing and distribution fees was $7,835,000 ($7,910,000 gross revenue less $75,000 expenses) and $7,416,000 ($7,522,000 gross revenue less $106,000 expenses), respectively. For the six months ended June 30, 2024 and 2023, interest, marketing and distribution fees was $16,598,000 ($16,758,000 gross revenue less $160,000 expenses) and $14,389,000 ($14,651,000 gross revenue less $262,000 expenses), respectively.