6. FINANCIAL INSTRUMENTS

Investments—Trading

The following table provides detail of the investments classified as investments-trading as of the periods indicated:



INVESTMENTS - TRADING
(Dollars in Thousands)

	June 30, 2013		December 31, 2012
U.S. government agency MBS and CMOs (1)	$	42,399	$	34,592
U.S. government agency debt securities		18,079		21,066
RMBS		5,831		583
CMBS		266		12
U.S. Treasury securities		8,596		147
Interests in securitizations (2)		3,680		352
SBA loans		34,441		15,705
Corporate bonds and redeemable preferred stock		39,847		56,022
Foreign government bonds		4		448
Municipal bonds		16,444		37,745
Exchange traded funds		6		-
Certificates of deposit		6,982		8,934
Equity securities		300		533
Investments-trading	$	176,875	$	176,139

(1) Includes TBAs. See note 8.

(2) Primarily comprised of CDOs, CLOs, and ABS.

Trading Securities Sold, Not Yet Purchased

The following table provides detail of the trading securities sold, not yet purchased as of the periods indicated:



TRADING SECURITIES SOLD, NOT YET PURCHASED
(Dollars in Thousands)

	June 30, 2013		December 31, 2012
U.S. government agency MBS (1)	$	561	$	13
U.S. Treasury securities		46,958		19,722
Corporate bonds and redeemable preferred stock		21,184		21,976
Foreign government bonds		67		-
Municipal bonds		129		128
Exchange traded funds		99		-
Certificates of deposit		5,364		2,325
Equity securities		-		3
Trading securities sold, not yet purchased	$	74,362	$	44,167

(1) Represents TBAs. See note 8.

The Company tries to manage its exposure to changes in interest rates for the interest rate sensitive securities it holds by entering into offsetting short positions for similar fixed rate securities.

The Company included the change in unrealized losses in the amount of $168 and $432 for the six months ended June 30, 2013 and 2012, respectively, in net trading revenue in the Company’s consolidated statements of operations.

Other Investments, at fair value

The following table provides detail of the investments included within other investments, at fair value:



OTHER INVESTMENTS, AT FAIR VALUE
(Dollars in Thousands)

	June 30, 2013
	Cost		Carrying Value		Unrealized Gain(Loss)
Interests in securitizations (1)	$	217	$	58	$	(159)
Equity Securities:
EuroDekania		7,807		2,040		(5,767)
Star Asia		23,304		20,935		(2,369)
Star Asia Special Situations Fund		2,143		2,775		632
Tiptree		5,561		2,177		(3,384)
Other securities		176		31		(145)
Total equity securities		38,991		27,958		(11,033)
Residential loans		210		270		60
Foreign currency forward contracts		-		400		400
Other investments, at fair value	$	39,418	$	28,686	$	(10,732)



	December 31, 2012
	Cost		Carrying Value		Unrealized Gain(Loss)
Interests in securitizations (1)	$	217	$	77	$	(140)
Equity Securities:
EuroDekania		7,807		2,054		(5,753)
Star Asia		23,304		30,169		6,865
Star Asia Special Situations Fund		1,841		2,503		662
Tiptree		5,561		2,834		(2,727)
Other securities		232		431		199
Total equity securities		38,745		37,991		(754)
Residential loans		230		255		25
Other investments, at fair value	$	39,192	$	38,323	$	(869)

(1) Represents an interest in a CDO.