A. M.  Best states that the “A+” (“Superior”) rating is assigned to those companies which, in its opinion, have a superior ability to meet their ongoing obligations to policyholders based on A. M.  Best’s comprehensive quantitative and qualitative evaluation of a company’s balance sheet strength, operating performance and business profile.
Standard & Poor’s states that the “AA-” rating is assigned to those insurance companies which, in its opinion, have very strong financial security characteristics with respect to their ability to pay under its insurance policies and contracts in accordance with their terms.
Moody’s states that insurance companies rated “Aa” offer excellent financial security.
Together with the Aaa rated companies, Aa rated companies constitute what are generally known as high-grade companies, with Aa rated companies generally having somewhat larger long-term risks.
Subsidiaries other than Everest Re and Bermuda Re may not be rated by some or any rating agencies because such ratings are not considered essential by the individual subsidiary’s customers or because of the limited nature of the subsidiary’s operations.
In particular, Mt.
McKinley is not rated because it is in run-off status.
Debt Ratings.
The following table shows the debt ratings by A. M.  Best, Standard & Poor’s and Moody’s of the Holdings’ senior notes due March 15, 2010 and October 15, 2014 and long term notes due May 1, 2067 and Everest Re Capital Trust II’s (“Capital Trust II”) trust preferred securities due March 29, 2034, all of which are considered investment grade.
Debt ratings are a current assessment of the credit worthiness of an obligor with respect to a specific obligation.
## Table 0 ##
A debt rating of “a” or “a-” is assigned by A. M.  Best where the issuer, in A. M.  Best’s opinion, has a strong ability to meet the terms of the obligation.
A debt rating of “A-” is assigned by Standard & Poor’s where the obligor has a strong capacity to meet its financial commitment on the obligation, although it is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rated categories.
Standard & Poor’s assigns a debt rating of “BBB” to issues that exhibit adequate protection parameters although adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.
According to Moody’s, a debt rating of “A3” is assigned to issues that are considered upper-medium-grade obligations and subject to low credit risk.
Obligations rated “Baa1” are subject to moderate credit risk and are considered mediumgrade and as such may possess certain speculative characteristics.
Competition.
The worldwide reinsurance and insurance businesses are highly competitive, as well as cyclical by product and market.
As a result, financial results tend to fluctuate with periods of constrained availability, high rates and strong profits followed by periods of abundant capacity, low rates and constrained profitability.
Competition in the types of reinsurance and insurance business that the Company underwrites is based on many factors, including the perceived overall financial strength of the reinsurer or insurer, ratings of the reinsurer or insurer by A. M.  Best and/or Standard & Poor’s, underwriting expertise, the jurisdictions where the reinsurer or insurer is licensed or otherwise authorized, capacity and coverages offered, premiums charged, other terms and conditions of the reinsurance and insurance business offered, services offered, speed of claims payment and reputation and experience in lines written.
Furthermore, the market impact from these competitive factors related to reinsurance and insurance is generally not consistent across lines of business, domestic and international geographical areas and distribution channels.
The Company competes in the U. S. , Bermuda and international reinsurance and insurance markets with numerous global competitors.
The Company’s competitors include independent reinsurance and insurance companies, subsidiaries or affiliates of established worldwide insurance companies, reinsurance departments of certain insurance companies and domestic and international underwriting operations, including underwriting syndicates at Lloyd’s.
Some of these competitors have greater financial resources than the Company and have established long term and continuing business relationships, which can be a significant competitive advantage.
In addition, the lack of strong barriers to entry into the reinsurance business and the potential for securitization of reinsurance and insurance risks through capital markets provide additional sources of potential reinsurance and insurance capacity and competition.
Net Realized Capital Gains.
The following table presents the composition of our net realized capital gains for the periods indicated:
## Table 1 ##
Effective January 1, 2007, we adopted and implemented FAS 159 for our actively managed equity securities.
As such, we recorded $76.6 million of net realized gains from fair value re-measurements in our consolidated statements of operations and comprehensive income for 2007.
Segment Results.
Through our subsidiaries, we operate in five segments: U. S.  Reinsurance, U. S.  Insurance, Specialty Underwriting, International and Bermuda.
The U. S.  Reinsurance operation writes property and casualty reinsurance, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding companies within the U. S.  The U. S.  Insurance operation writes property and casualty insurance primarily through general agents and surplus lines brokers within the U. S.  The Specialty Underwriting operation writes A&H, marine, aviation and surety business within the U. S.  and worldwide through brokers and directly with ceding companies.
The International operation writes non-U.
S.  property and casualty reinsurance through Everest Re’s branches in Canada and Singapore and offices in Miami and New Jersey.
The Bermuda operation provides insurance and reinsurance to worldwide property and casualty markets and reinsurance to the United Kingdom and European markets through its UK branch.
Ireland.
Holdings Ireland, Everest Dublin Holdings, Ireland Re and Ireland Insurance conduct business in Ireland and are subject to taxation in Ireland.
Available Information.
The Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports are available free of charge through the Company’s internet website at http://www.
everestre.
com as soon as reasonably practicable after such reports are electronically filed with the Securities and Exchange Commission (the “SEC”).
ITEM 1A.
RISK FACTORS In addition to the other information provided in this report, the following risk factors should be considered when evaluating an investment in our securities.
If the circumstances contemplated by the individual risk factors materialize, our business, financial condition and results of operations could be materially and adversely affected and the trading price of our common shares could decline significantly.
RISKS RELATING TO OUR BUSINESS Fluctuations in the financial markets could result in investment losses.
Prolonged and severe disruptions in the overall public and private debt and equity markets, such as occurred during 2008, could result in significant realized and unrealized losses in our investment portfolio.
Although financial markets have significantly improved since 2008, they could deteriorate in the future.
There could also be disruption in individual market sectors, such as occurred in the energy sector in recent years.
Such declines in the financial markets could result in significant realized and unrealized losses on investments and could have a material adverse impact on our results of operations, equity, business and insurer financial strength and debt ratings.
Our results could be adversely affected by catastrophic events.
We are exposed to unpredictable catastrophic events, including weather-related and other natural catastrophes, as well as acts of terrorism.
Any material reduction in our operating results caused by the occurrence of one or more catastrophes could inhibit our ability to pay dividends or to meet our interest and principal payment obligations.
By way of illustration, during the past five calendar years, pre-tax catastrophe losses, net of reinsurance, were as follows:
## Table 2 ##
Our losses from future catastrophic events could exceed our projections.
We use projections of possible losses from future catastrophic events of varying types and magnitudes as a strategic underwriting tool.
We use these loss projections to estimate our potential catastrophe losses in certain geographic areas and decide on the placement of retrocessional coverage or other actions to limit the extent of potential losses in a given geographic area.
These loss projections are approximations, reliant on a mix of quantitative and qualitative processes, and actual losses may exceed the projections by a material amount, resulting in a material adverse effect on our financial condition and results of operations.
ANALOG DEVICES, INC.  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) contingent consideration of up to $13.8 million.
The contingent consideration arrangement requires additional cash payments to the former equity holders of Lyric upon the achievement of certain technological and product development milestones payable during the period from June 2011 through June 2016.
The Company estimated the fair value of the contingent consideration arrangement utilizing the income approach.
Changes in the fair value of the contingent consideration subsequent to the acquisition date primarily driven by assumptions pertaining to the achievement of the defined milestones will be recognized in operating income in the period of the estimated fair value change.
As of October 29, 2011, no contingent payments have been made and the fair value of the contingent consideration was approximately $14.0 million.
The Company allocated the purchase price to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition, resulting in the recognition of $12.2 million of IPR&D, $18.9 million of goodwill and $3.3 million of net deferred tax liabilities.
The goodwill recognized is attributable to future technologies that have yet to be determined as well as the assembled workforce of Lyric.
Future technologies do not meet the criteria for recognition separately from goodwill because they are a part of future development and growth of the business.
None of the goodwill is expected to be deductible for tax purposes.
In addition, the Company will be obligated to pay royalties to the former equity holders of Lyric on revenue recognized from the sale of Lyric products and licenses through the earlier of 20 years or the accrual of a maximum of $25 million.
Royalty payments to Lyric employees require post-acquisition services to be rendered and, as such, the Company will record these amounts as compensation expense in the related periods.
As of October 29, 2011, no royalty payments have been made.
The Company recognized $0.2 million of acquisition-related costs that were expensed in the third quarter of fiscal 2011.
These costs are included in operating expenses in the consolidated statement of income.
The Company has not provided pro forma results of operations for Integrant, AudioAsics and Lyric herein as they were not material to the Company on either an individual or an aggregate basis.
The Company included the results of operations of each acquisition in its consolidated statement of income from the date of such acquisition.7.
Deferred Compensation Plan Investments Investments in The Analog Devices, Inc.
Deferred Compensation Plan (the Deferred Compensation Plan) are classified as trading.
The components of the investments as of October 29, 2011 and October 30, 2010 were as follows:
## Table 3 ##
The fair values of these investments are based on published market quotes on October 29, 2011 and October 30, 2010, respectively.
Adjustments to the fair value of, and income pertaining to, Deferred Compensation Plan investments are recorded in operating expenses.
Gross realized and unrealized gains and losses from trading securities were not material in fiscal 2011, 2010 or 2009.
The Company has recorded a corresponding liability for amounts owed to the Deferred Compensation Plan participants (see Note 10).
These investments are specifically designated as available to the Company solely for the purpose of paying benefits under the Deferred Compensation Plan.
However, in the event the Company became insolvent, the investments would be available to all unsecured general creditors.8.
Other Investments Other investments consist of equity securities and other long-term investments.
Investments are stated at fair value, which is based on market quotes or on a cost-basis, dependent on the nature of the investment, as appropriate.
Adjustments to the fair value of investments classified as available-for-sale are recorded as an increase or decrease
appropriately to a significant reduction in a credit rating of any investment issuer or guarantor.
The short-term interest-bearing portfolio of Cash and cash equivalents includes only marketable securities with active secondary or resale markets to ensure portfolio liquidity.
All highly liquid investments with a maturity of three months or less at the date of purchase are considered to be cash equivalents.
Investments with maturities greater than three months are classified as available-for-sale and are considered to be short-term investments.
The carrying value of our interest-bearing instruments approximated fair value as of December 29, 2007.

Tables referenced above, in order (Table 0 first):
<table><tr><td></td><td colspan="2">A.M. Best</td><td colspan="2">Standard & Poor's</td><td colspan="2">Moody's</td></tr><tr><td>Senior Notes</td><td>a-</td><td>(Excellent)</td><td>A-</td><td>(Strong security)</td><td>A3</td><td>(Good security)</td></tr><tr><td>Trust Preferred Securities</td><td>bbb</td><td>(Good)</td><td>BBB</td><td>(Adequate)</td><td>Baa1</td><td>(Adequate security)</td></tr><tr><td>Long Term Notes</td><td>bbb+</td><td>(Good)</td><td>BBB</td><td>(Adequate)</td><td>Baa1</td><td>(Adequate security)</td></tr></table>
<table><tr><td></td><td colspan="3">Years Ended December 31,</td><td colspan="2">2007/2006</td><td colspan="2">2006/2005</td></tr><tr><td>(Dollars in millions)</td><td>2007</td><td>2006</td><td>2005</td><td>Variance</td><td>% Change</td><td>Variance</td><td>% Change</td></tr><tr><td>Gains (losses) from sales:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Fixed maturities</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Gains</td><td>$ 2.6</td><td>$ 14.9</td><td>$ 89.6</td><td>$ -12.3</td><td>-82.6%</td><td>$ -74.7</td><td>-83.4%</td></tr><tr><td>Losses</td><td>-16.9</td><td>-2.0</td><td>-12.4</td><td>-14.9</td><td>NM</td><td>10.4</td><td>-83.9%</td></tr><tr><td>Total</td><td>-14.3</td><td>12.9</td><td>77.2</td><td>-27.2</td><td>-210.9%</td><td>-64.3</td><td>-83.3%</td></tr><tr><td>Equity securities, market value</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Gains</td><td>-</td><td>34.1</td><td>16.6</td><td>-34.1</td><td>-100.0%</td><td>17.5</td><td>105.2%</td></tr><tr><td>Losses</td><td>-</td><td>-11.9</td><td>-3.5</td><td>11.9</td><td>-100.0%</td><td>-8.4</td><td>240.0%</td></tr><tr><td>Total</td><td>-</td><td>22.2</td><td>13.1</td><td>-22.2</td><td>-100.0%</td><td>9.1</td><td>69.5%</td></tr><tr><td>Equity securities, fair value</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Gains</td><td>45.9</td><td>-</td><td>-</td><td>45.9</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Losses</td><td>-21.9</td><td>-</td><td>-</td><td>-21.9</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Total</td><td>24.0</td><td>-</td><td>-</td><td>24.0</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Other invested assets</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Gains</td><td>-</td><td>-</td><td>-</td><td>-</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Losses</td><td>-</td><td>-</td><td>-</td><td>-</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Total</td><td>-</td><td>-</td><td>-</td><td>-</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Short-term investments</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Gains</td><td>-</td><td>-</td><td>-</td><td>-</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Losses</td><td>-</td><td>-</td><td>-</td><td>-</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Total</td><td>-</td><td>-</td><td>-</td><td>-</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td colspan="2">Total net realized gains (losses) from sales</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Gains</td><td>48.5</td><td>49.0</td><td>106.2</td><td>-0.5</td><td>-1.0%</td><td>-57.2</td><td>-53.9%</td></tr><tr><td>Losses</td><td>-38.8</td><td>-13.9</td><td>-15.9</td><td>-24.9</td><td>179.1%</td><td>2.0</td><td>-12.6%</td></tr><tr><td>Total</td><td>9.7</td><td>35.1</td><td>90.3</td><td>-25.4</td><td>-72.4%</td><td>-55.2</td><td>-61.2%</td></tr><tr><td colspan="2">Gains (losses) from fair value adjustments:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Equity securities, fair value</td><td>76.6</td><td>-</td><td>-</td><td>76.6</td><td>NM</td><td>-</td><td>NM</td></tr><tr><td>Total net realized gains (losses)</td><td>$ 86.3</td><td>$ 35.1</td><td>$ 90.3</td><td>$ 51.2</td><td>146.1%</td><td>$ -55.2</td><td>-61.2%</td></tr><tr><td>(NM, not meaningful)</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td colspan="2">(Some amounts may not reconcile due to rounding)</td><td></td><td></td><td></td><td></td><td></td><td></td></tr></table>
<table><tr><td>Calendar year:</td><td>Pre-tax catastrophe losses</td></tr><tr><td>(Dollars in millions)</td><td></td></tr><tr><td>2018</td><td>$1,800.2</td></tr><tr><td>2017</td><td>1,472.6</td></tr><tr><td>2016</td><td>301.2</td></tr><tr><td>2015</td><td>53.8</td></tr><tr><td>2014</td><td>56.3</td></tr></table>
<table><tr><td></td><td>2011</td><td>2010</td></tr><tr><td>Money market funds</td><td>$17,187</td><td>$1,840</td></tr><tr><td>Mutual funds</td><td>9,223</td><td>6,850</td></tr><tr><td>Total Deferred Compensation Plan investments</td><td>$26,410</td><td>$8,690</td></tr></table>

Question: Which element makes up more than 40 % of the total in 2006?
Answer: Gains for Fixed maturities, Gains for Equity securities, market value