MARKETAXESS HOLDINGS INC Fair Value Disclosure
4. Fair Value Measurements
The following table summarizes the valuation of the Company’s assets and liabilities measured at fair value as categorized based on the hierarchy described in Note 2:
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
||||
|
(In thousands) |
|
|||||||||||||
As of December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
$ |
23,355 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
23,355 |
|
Securities available-for-sale |
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate debt |
|
— |
|
|
|
58,440 |
|
|
|
— |
|
|
|
58,440 |
|
Trading securities |
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasuries |
|
— |
|
|
|
100,772 |
|
|
|
— |
|
|
|
100,772 |
|
Mutual funds held in rabbi trust |
|
— |
|
|
|
11,465 |
|
|
|
— |
|
|
|
11,465 |
|
Foreign currency forward position |
|
— |
|
|
|
1,847 |
|
|
|
— |
|
|
|
1,847 |
|
Total assets |
$ |
23,355 |
|
|
$ |
172,524 |
|
|
$ |
— |
|
|
$ |
195,879 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
As of December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds |
$ |
55,473 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
55,473 |
|
Securities available-for-sale |
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate debt |
|
— |
|
|
|
55,108 |
|
|
|
— |
|
|
|
55,108 |
|
Trading securities |
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasuries |
|
— |
|
|
|
99,045 |
|
|
|
— |
|
|
|
99,045 |
|
Mutual funds held in rabbi trust |
|
— |
|
|
|
11,107 |
|
|
|
— |
|
|
|
11,107 |
|
Total assets |
$ |
55,473 |
|
|
$ |
165,260 |
|
|
$ |
— |
|
|
$ |
220,733 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
||||
Foreign currency forward position |
|
— |
|
|
|
936 |
|
|
|
— |
|
|
|
936 |
|
Total liabilities |
$ |
— |
|
|
$ |
936 |
|
|
$ |
— |
|
|
$ |
936 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds are included in cash and cash equivalents on the Consolidated Statements of Financial Condition. Securities available-for-sale and trading securities are included in investments, at fair value on the Consolidated Statements of Financial Condition. Securities classified within Level 2 were valued using a market approach utilizing prices and other relevant information generated by market transactions involving comparable assets. The foreign currency forward contracts are included in either other assets or accounts payable, accrued expenses and other liabilities on the Consolidated Statements of Financial Condition, and are classified within Level 2 as the valuation inputs are based on quoted market prices. The mutual funds held in a rabbi trust represent investments associated with the Company’s deferred cash incentive plan.
During the years ended December 31, 2025 and 2024, there were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3.
The table below presents the carrying value, fair value and fair value hierarchy category of the Company’s financial assets and liabilities that are not measured at fair value on the Consolidated Statements of Financial Condition. The carrying values of the Company’s financial assets and liabilities not measured at fair value categorized in the fair value hierarchy as Level 1 and Level 2 approximate fair value due to the short-term nature of the underlying assets and liabilities.
|
Carrying Value |
|
|
Fair Value |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
||||||
|
(In thousands) |
|
|||||||||||||||||||||
As of December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Financial assets not measured at fair value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash |
$ |
496,379 |
|
|
$ |
496,379 |
|
|
$ |
496,379 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
496,379 |
|
Cash segregated under federal regulations |
|
48,722 |
|
|
|
48,722 |
|
|
|
48,722 |
|
|
|
— |
|
|
|
— |
|
|
|
48,722 |
|
Accounts receivable, net of allowance |
|
100,989 |
|
|
|
100,989 |
|
|
|
— |
|
|
|
100,989 |
|
|
|
— |
|
|
|
100,989 |
|
Receivables from broker-dealers, clearing |
|
489,211 |
|
|
|
489,211 |
|
|
|
107,223 |
|
|
|
381,988 |
|
|
|
— |
|
|
|
489,211 |
|
Total assets |
$ |
1,135,301 |
|
|
$ |
1,135,301 |
|
|
$ |
652,324 |
|
|
$ |
482,977 |
|
|
$ |
— |
|
|
$ |
1,135,301 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Financial liabilities not measured at fair value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Payables to broker-dealers, clearing |
$ |
325,959 |
|
|
$ |
325,959 |
|
|
$ |
— |
|
|
$ |
325,959 |
|
|
$ |
— |
|
|
$ |
325,959 |
|
Borrowings |
|
220,000 |
|
|
|
220,000 |
|
|
|
— |
|
|
|
220,000 |
|
|
|
— |
|
|
|
220,000 |
|
Total liabilities |
$ |
545,959 |
|
|
$ |
545,959 |
|
|
$ |
— |
|
|
$ |
545,959 |
|
|
$ |
— |
|
|
$ |
545,959 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
As of December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Financial assets not measured at fair value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash |
$ |
489,005 |
|
|
$ |
489,005 |
|
|
$ |
489,005 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
489,005 |
|
Cash segregated under federal regulations |
|
47,107 |
|
|
|
47,107 |
|
|
|
47,107 |
|
|
|
— |
|
|
|
— |
|
|
|
47,107 |
|
Accounts receivable, net of allowance |
|
91,845 |
|
|
|
91,845 |
|
|
|
— |
|
|
|
91,845 |
|
|
|
— |
|
|
|
91,845 |
|
Receivables from broker-dealers, clearing |
|
357,728 |
|
|
|
357,728 |
|
|
|
107,652 |
|
|
|
250,076 |
|
|
|
— |
|
|
|
357,728 |
|
Total assets |
$ |
985,685 |
|
|
$ |
985,685 |
|
|
$ |
643,764 |
|
|
$ |
341,921 |
|
|
$ |
— |
|
|
$ |
985,685 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Financial liabilities not measured at fair value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Payables to broker-dealers, clearing |
$ |
218,845 |
|
|
$ |
218,845 |
|
|
$ |
— |
|
|
$ |
218,845 |
|
|
$ |
— |
|
|
$ |
218,845 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
The Company enters into foreign currency forward contracts as an economic hedge against certain foreign currency transaction gains and losses in the Consolidated Statements of Operations. These forward contracts are for three-month periods and are used to limit exposure to foreign currency exchange rate fluctuations. The Company records the fair value of the asset in prepaid expenses and other assets or the fair value of the liability in accounts payable, accrued expenses and other liabilities in the Consolidated Statements of Financial Condition. The following table summarizes the Company’s foreign currency forward position:
|
As of |
|
|||||
|
December 31, 2025 |
|
|
December 31, 2024 |
|
||
|
(In thousands) |
|
|||||
Notional value |
$ |
94,197 |
|
|
$ |
64,454 |
|
Fair value of notional |
|
96,044 |
|
|
|
63,518 |
|
Fair value of the asset/(liability) |
$ |
1,847 |
|
|
$ |
(936 |
) |
|
|
|
|
|
|
||
Realized and unrealized gains and losses on foreign currency forward contracts are included in other, net in the Consolidated Statements of Operations. The following table summarizes the realized and unrealized gains and losses on foreign currency forward contracts:
|
Year Ended December 31, |
|
|||||||||
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
(In thousands) |
|
|||||||||
Unrealized gain/(loss) |
$ |
2,782 |
|
|
$ |
(2,838 |
) |
|
|
3,590 |
|
Realized gain/(loss) |
|
1,667 |
|
|
|
1,148 |
|
|
$ |
(1,470 |
) |
Total gain/(loss) |
$ |
4,449 |
|
|
$ |
(1,690 |
) |
|
$ |
2,120 |
|
|
|
|
|
|
|
|
|
|
|||
The Company records restricted cash collateral deposits with its counterparty bank in prepaid expenses and other assets on the Consolidated Statements of Financial Condition. As of December 31, 2025, the Company did not maintain a collateral deposit with its counterparty bank.
The Company also enters into interest rate swap agreements to manage its exposure to the effect of interest rate changes on its unrealized gains and losses on U.S. Treasury investments. As of December 31, 2025, the Company had no interest rate swaps outstanding.
The following table summarizes the Company’s investments:
|
Amortized |
|
|
Gross |
|
|
Gross |
|
|
Fair |
|
||||||||
|
|
(In thousands) |
|
||||||||||||||||
As of December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Securities available-for-sale |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate debt |
$ |
|
58,110 |
|
|
$ |
|
333 |
|
|
$ |
|
(3 |
) |
|
$ |
|
58,440 |
|
Trading securities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasuries |
|
|
100,487 |
|
|
|
|
329 |
|
|
|
|
(44 |
) |
|
|
|
100,772 |
|
Mutual funds held in rabbi trust |
|
|
10,563 |
|
|
|
|
926 |
|
|
|
|
(24 |
) |
|
|
|
11,465 |
|
Total investments |
$ |
|
169,160 |
|
|
$ |
|
1,588 |
|
|
$ |
|
(71 |
) |
|
$ |
|
170,677 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
As of December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Securities available-for-sale |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate debt |
$ |
|
55,447 |
|
|
$ |
|
88 |
|
|
$ |
|
(427 |
) |
|
$ |
|
55,108 |
|
Trading securities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasuries |
|
|
100,484 |
|
|
|
|
86 |
|
|
|
|
(1,525 |
) |
|
|
|
99,045 |
|
Mutual funds held in rabbi trust |
|
|
10,212 |
|
|
|
|
900 |
|
|
|
|
(5 |
) |
|
|
|
11,107 |
|
Total investments |
$ |
|
166,143 |
|
|
$ |
|
1,074 |
|
|
$ |
|
(1,957 |
) |
|
$ |
|
165,260 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Proceeds from the sales and maturities of investments were $85.6 million and $62.4 million for the years ended December 31, 2025 and 2024, respectively. Purchases of investments were $87.8 million and $93.4 million for the years ended December 31, 2025 and 2024, respectively.
The following table summarizes the Company’s unrealized and realized gains and losses on investments:
|
Year Ended December 31, |
|
||||||||||||
|
2025 |
|
|
2024 |
|
|
2023 |
|
||||||
|
(In thousands) |
|
||||||||||||
Unrealized gains/(losses) |
|
|
|
|
|
|
|
|
|
|
|
|||
Securities available-for-sale |
|
|
|
|
|
|
|
|
|
|
|
|||
Corporate debt |
$ |
|
669 |
|
|
$ |
|
(328 |
) |
|
$ |
|
(11 |
) |
Trading securities |
|
|
|
|
|
|
|
|
|
|
|
|||
U.S. Treasuries |
|
|
1,733 |
|
|
|
|
(1,025 |
) |
|
|
|
446 |
|
Mutual funds held in rabbi trust |
|
|
7 |
|
|
|
|
1,372 |
|
|
|
|
1,284 |
|
Total investments |
$ |
|
2,409 |
|
|
$ |
|
19 |
|
|
$ |
|
1,719 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Realized gains/(losses) |
|
|
|
|
|
|
|
|
|
|
|
|||
Securities available-for-sale |
|
|
|
|
|
|
|
|
|
|
|
|||
Corporate debt |
$ |
|
5 |
|
|
$ |
|
4 |
|
|
$ |
|
(11 |
) |
Trading securities |
|
|
|
|
|
|
|
|
|
|
|
|||
Mutual funds held in rabbi trust |
|
|
1,259 |
|
|
|
|
(328 |
) |
|
|
|
(138 |
) |
Total investments |
$ |
|
1,264 |
|
|
$ |
|
(324 |
) |
|
$ |
|
(149 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|||
Securities sold, not yet purchased |
$ |
|
— |
|
|
$ |
|
174 |
|
|
$ |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Unrealized gains and losses on securities available-for-sale are included in accumulated other comprehensive loss on the Consolidated Statements of Financial Condition. Realized gains and losses on securities available-for-sale and realized and unrealized gains and losses on trading securities are included in other, net on the Consolidated Statements of Operations.
The following table summarizes the fair value of the Company’s corporate debt and U.S. Treasury investments based upon the contractual maturities:
|
Less than one year |
|
|
Due in 1 - 5 years |
|
|
Total |
|
|||
|
(In thousands) |
|
|||||||||
As of December 31, 2025 |
|
|
|
|
|
|
|
|
|||
Securities available-for-sale |
|
|
|
|
|
|
|
|
|||
Corporate debt |
$ |
8,400 |
|
|
$ |
50,040 |
|
|
$ |
58,440 |
|
Trading securities |
|
|
|
|
|
|
|
|
|||
U.S. Treasuries |
|
— |
|
|
|
100,772 |
|
|
$ |
100,772 |
|
Total |
$ |
8,400 |
|
|
$ |
150,812 |
|
|
$ |
159,212 |
|
|
|
|
|
|
|
|
|
|
|||
As of December 31, 2024 |
|
|
|
|
|
|
|
|
|||
Securities available-for-sale |
|
|
|
|
|
|
|
|
|||
Corporate debt |
$ |
9,346 |
|
|
$ |
45,762 |
|
|
$ |
55,108 |
|
Trading securities |
|
|
|
|
|
|
|
|
|||
U.S. Treasuries |
|
49,978 |
|
|
|
49,067 |
|
|
|
99,045 |
|
Total |
$ |
59,324 |
|
|
$ |
94,829 |
|
|
$ |
154,153 |
|
|
|
|
|
|
|
|
|
|
|||
The following table provides fair values and unrealized losses on the Company’s available-for-sale investments and the aging of securities’ continuous unrealized loss positions:
|
Less than Twelve Months |
|
|
Twelve Months or More |
|
|
Total |
|
|||||||||||||||
|
Fair value |
|
|
Gross unrealized losses |
|
|
Fair value |
|
|
Gross unrealized losses |
|
|
Fair value |
|
|
Gross unrealized losses |
|
||||||
|
(In thousands) |
|
|||||||||||||||||||||
As of December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Corporate debt |
$ |
3,506 |
|
|
$ |
(3 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
3,506 |
|
|
$ |
(3 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
As of December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Corporate debt |
$ |
38,041 |
|
|
$ |
(426 |
) |
|
$ |
1,226 |
|
|
$ |
(1 |
) |
|
$ |
39,267 |
|
|
$ |
(427 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
During the years ended December 31, 2025, 2024 and 2023, the Company did not recognize any credit losses on its available-for-sale securities. The unrealized losses on securities are due to changes in interest rates and market liquidity.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 24, 2026 | Showing above |
| 2019 | Feb 18, 2020 | |
| 2018 | Feb 20, 2019 | |
| 2017 | Feb 21, 2018 | |
| 2016 | Feb 21, 2017 | |
| 2015 | Feb 25, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.