Company: COHN
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001437749-25-014235
Chunk: 158

Company: Cohen & Co Inc.
Filing Date: 2025-05-02
Form: 10-Q
Item: Item 8
Chunk 158
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 (but do not require) the reporting entity to net the derivative asset and liability on the consolidated balance sheets. It is the Company’s policy to present the derivative assets and liabilities on a net basis if the conditions of ASC 210 are met.  However, in general, the Company does not enter into offsetting derivatives with the same counterparties.  Therefore, in all periods presented, no derivatives are presented on a net basis. 
    
   Derivative financial instruments are recorded at fair value. If the derivative was entered into as part of the Company’s broker-dealer operations, it will be included as a component of investments-trading or trading securities sold, not yet purchased. If it was entered into as a hedge for another financial instrument included in other investments, at fair value, then the derivative will be included as a component of other investments, at fair value.
    
   The Company  may, from time to time, enter into derivatives to manage its risk exposures arising from (i) fluctuations in foreign currency rates with respect to the Company’s investments in foreign currency denominated investments; (ii) the Company’s investments in interest sensitive investments; (iii) the Company's investment in equities; and (iv) the Company’s facilitation of mortgage-backed trading. Derivatives entered into by the Company, from time to time,  may include (a) foreign currency forward contracts; (b) purchase and sale agreements of TBAs and other forward agency MBS contracts; (c) other extended settlement trades; and (d) SFAs.
    
   Derivatives involve varying degrees of off-balance sheet risk, whereby changes in the level or volatility of interest rates or market values of the underlying financial instruments  may result in changes in the value of a particular financial instrument in excess of its carrying amount. Depending on the Company’s investment strategy, realized and unrealized gains and losses are recognized in principal transactions and other income or in net trading in the Company’s consolidated statements of operations on a trade date basis.
    
   The Company  may, from time to time, enter into the following derivative instruments.
    
   Equity Derivatives
    
   A significant portion of the Company’s equity holdings are carried at fair value.  From time to time, the Company hedges a portion of this exposure by entering into equity derivatives such as puts and short call options.  These derivative positions are held at fair value as a component of other investments, at fair value