v3.26.3
Derivative Financial Instruments
 9 Months Ended
Aug. 31, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments
Note 6. Derivative Financial Instruments
Our derivative activities are recorded at fair value in our Consolidated Statement of Financial Condition in Financial instruments owned and Financial instruments sold, not yet purchased, net of cash paid or received under credit support agreements and on a net counterparty basis when a legally enforceable right to offset exists under a master netting agreement. We enter into derivative transactions to satisfy the needs of our clients and to manage our own exposure to market and credit risks. In addition, we apply hedge accounting to: (1) interest rate swaps that have been designated as fair value hedges of the changes in fair value due to the benchmark interest rate for certain fixed rate senior long-term debt, (2) an interest rate swap designated as hedge to offset the variability in cash flows from floating rate debt due to contractually specified interest rate, and (3) forward foreign exchange contracts designated as hedges to offset the change in the value of certain net investments in foreign operations.
Derivatives are subject to various risks similar to other financial instruments, including market, credit and operational risk. The risks of derivatives should not be viewed in isolation, but rather should be considered on an aggregate basis along with our other trading-related activities. We manage the risks associated with derivatives on an aggregate basis along with the risks associated with proprietary trading as part of our firm wide risk management policies.
In connection with our derivative activities, we may enter into International Swaps and Derivatives Association, Inc. master netting agreements or similar agreements with counterparties.
August 31, 2026 (1)
AssetsLiabilities
$ in thousandsFair ValueNumber of Contracts (2)Fair ValueNumber of Contracts (2)
Derivatives designated as accounting hedges:
Interest rate contracts:
Cleared OTC$— — $910 3 
Bilateral OTC346 1 — — 
Foreign exchange contracts:
Bilateral OTC1,069 1 43,625 17 
Total derivatives designated as accounting hedges1,415 44,535 
Derivatives not designated as accounting hedges:
Interest rate contracts:
Exchange-traded876 4,273 233 15,193 
Cleared OTC1,073,315 9,404 1,059,366 9,147 
Bilateral OTC267,397 745 800,746 1,533 
Foreign exchange contracts:
Exchange-traded885 627 641 1,879 
Bilateral OTC155,131 32,332 109,282 11,914 
Equity contracts:
Exchange-traded1,438,125 2,277,967 1,209,793 1,411,012 
Bilateral OTC2,044,367 33,276 2,313,733 32,037 
Commodity contracts:
Exchange-traded247 640 578 377 
Bilateral OTC6,620 12,125 2,044 5,597 
Credit contracts:
Cleared OTC8,197 89 10,420 35 
Bilateral OTC28,223 16 7,193 25 
Total derivatives not designated as accounting hedges5,023,383 5,514,029 
Total gross derivative assets/liabilities:
Exchange-traded1,440,133 1,211,245 
Cleared OTC1,081,512 1,070,696 
Bilateral OTC2,503,153 3,276,623 
Amounts offset in our Consolidated Statements of Financial Condition (3):
Exchange-traded(878,475)(878,475)
Cleared OTC(1,067,959)(1,070,696)
Bilateral OTC(2,129,081)(2,366,966)
Net amounts per Consolidated Statements of Financial Condition (4)$949,283 $1,242,427 
(1)Exchange-traded derivatives include derivatives executed on an organized exchange. Cleared OTC derivatives include derivatives executed bilaterally and subsequently novated to and cleared through central clearing counterparties. Bilateral OTC derivatives include derivatives executed and settled bilaterally without the use of an organized exchange or central clearing counterparty.
(2)The number of exchange-traded contracts may include open futures contracts. The unsettled fair value of these futures contracts is included in Receivables from/Payables to brokers, dealers and clearing organizations.
(3)Amounts netted include both netting by counterparty and for cash collateral paid or received.
(4)We have not received or pledged additional collateral under master netting agreements and/or other credit support agreements that is eligible to be offset beyond what has been offset in our Consolidated Statements of Financial Condition.

November 30, 2025 (1)
AssetsLiabilities
$ in thousandsFair ValueNumber of Contracts (2)Fair ValueNumber of Contracts (2)
Derivatives designated as accounting hedges:
Interest rate contracts:
Cleared OTC$— — $2,519 4 
Foreign exchange contracts:
Bilateral OTC40,444 7 574 2 
Total derivatives designated as accounting hedges40,444 3,093 
Derivatives not designated as accounting hedges:
Interest rate contracts:
Exchange-traded232 33,107 24 36,811 
Cleared OTC806,009 8,148 804,799 8,325 
Bilateral OTC285,053 1,576 614,104 823 
Foreign exchange contracts:
Bilateral OTC115,068 34,418 103,297 12,028 
Equity contracts:
Exchange-traded2,776,601 3,275,468 2,156,730 2,298,561 
Bilateral OTC1,367,089 57,254 1,670,215 36,481 
Commodity contracts:
Exchange-traded452 627 73 668 
Bilateral OTC 6,381 18,497 7,293 15,417 
Credit contracts:
Cleared OTC10,960 58 17,120 13 
Bilateral OTC121,557 17 98,456 15 
Total derivatives not designated as accounting hedges5,489,402 5,472,111 
Total gross derivative assets/liabilities:
Exchange-traded2,777,285 2,156,827 
Cleared OTC816,969 824,438 
Bilateral OTC1,935,592 2,493,939 
Amounts offset in our Consolidated Statements of Financial Condition (3):
Exchange-traded(1,600,969)(1,600,969)
Cleared OTC(815,810)(819,548)
Bilateral OTC(1,288,985)(1,564,670)
Net amounts per Consolidated Statements of Financial Condition (4)$1,824,082 $1,490,017 
(1)Exchange-traded derivatives include derivatives executed on an organized exchange. Cleared OTC derivatives include derivatives executed bilaterally and subsequently novated to and cleared through central clearing counterparties. Bilateral OTC derivatives include derivatives executed and settled bilaterally without the use of an organized exchange or central clearing counterparty.
(2)The number of exchange-traded contracts may include open futures contracts. The unsettled fair value of these futures contracts is included in Receivables from/Payables to brokers, dealers and clearing organizations.
(3)Amounts netted include both netting by counterparty and for cash collateral paid or received.
(4)We have not received or pledged additional collateral under master netting agreements and/or other credit support agreements that is eligible to be offset beyond what has been offset in our Consolidated Statements of Financial Condition.
Gains (losses) recognized in Interest expense related to fair value hedges:
$ in thousandsThree Months Ended August 31,Nine Months Ended August 31,
Gains (Losses)2026202520262025
Interest rate swaps (1)$(15,702)$8,902 $(43,986)$2,859 
Long-term debt5,672 (21,388)14,153 (40,047)
Total$(10,030)$(12,486)$(29,833)$(37,188)
(1)Includes net settlements of $9.7 million and $28.9 million for the three and nine months ended August 31, 2026, respectively, and $12.3 million and $36.4 million for the three and nine months ended August 31, 2025, respectively.
Gains (losses) on our cash flow hedge recognized as a component of Other comprehensive income (loss) (“OCI”), in our Consolidated Statements of Comprehensive Income:
$ in thousandsThree Months Ended August 31,Nine Months Ended August 31,
Gains (Losses)2026202520262025
Interest rate contracts
Recognized in OCI$600 $— $346 $— 
Net change included within AOCI$600 $— $346 $— 
Gains (losses) on our net investment hedges recognized in Currency translation and other adjustments, a component of OCI, in our Consolidated Statements of Comprehensive Income:
$ in thousandsThree Months Ended August 31,Nine Months Ended August 31,
Gains (Losses)2026202520262025
Foreign exchange contracts$(12,988)$(3,238)$(20,519)$(77,370)
Total$(12,988)$(3,238)$(20,519)$(77,370)
Unrealized and realized gains (losses) on derivative contracts recognized primarily in Principal transactions revenues, which are utilized in connection with our client activities and our economic risk management activities:
$ in thousandsThree Months Ended August 31,Nine Months Ended August 31,
Gains (Losses)2026202520262025
Interest rate contracts$(53,618)$242 $(133,707)$(30,970)
Foreign exchange contracts11,928 (15,402)13,377 1,309 
Equity contracts1,002,699 444,317 662,026 1,762,483 
Commodity contracts9,626 3,476 28,504 16,932 
Credit contracts(59)(9,105)(11,773)(7,401)
Total$970,576 $423,528 $558,427 $1,742,353 
The net gains (losses) on derivative contracts in the table above are one of a number of activities comprising our business activities and are before consideration of economic hedging transactions, which generally offset the net gains (losses) included above. We substantially mitigate our exposure to market risk on our cash instruments through derivative contracts, which generally provide offsetting revenues, and we manage the risk associated with these contracts in the context of our overall risk management framework.
OTC Derivatives
Remaining contract maturities at August 31, 2026:
OTC Derivative Assets (1) (2) (3)
$ in thousands0 – 12 Months1 – 5
Years		Greater
Than 5 Years		Cross-Maturity
Netting (4)		Total
Commodity swaps, options and forwards$6,619 $— $— $— $6,619 
Equity options and forwards61,747 248,300 — — 310,047 
Credit default swaps — 26,483 — — 26,483 
Total return swaps286,327 174,318 — (80,225)380,420 
Foreign currency forwards, swaps and options98,927 335 — (126)99,136 
Interest rate swaps, options and forwards45,145 158,279 27,964 (35,655)195,733 
Total$498,765 $607,715 $27,964 $(116,006)1,018,438 
Cross-product counterparty netting(61,347)
Total OTC derivative assets included in Financial instruments owned$957,091 
OTC Derivative Liabilities (1) (2) (3)
$ in thousands0 – 12 Months1 – 5 YearsGreater Than 5 YearsCross-Maturity Netting (4)Total
Commodity swaps, options and forwards$2,043 $— $— $— $2,043 
Equity options and forwards176,494 204,010 11,965 — 392,469 
Credit default swaps41 3,408 — — 3,449 
Total return swaps259,892 388,799 5 (80,225)568,471 
Foreign currency forwards, swaps and options89,653 6,314 — (126)95,841 
Fixed income forwards6,935 — — — 6,935 
Interest rate swaps, options and forwards45,246 173,263 529,029 (35,655)711,883 
Total$580,304 $775,794 $540,999 $(116,006)1,781,091 
Cross-product counterparty netting(61,347)
Total OTC derivative liabilities included in Financial instruments sold, not yet purchased$1,719,744 
(1)At August 31, 2026, we held net exchange-traded derivative assets and liabilities with a fair value of $561.7 million and $332.8 million, respectively, which are not included in these tables.
(2)OTC derivative assets and liabilities in the tables above are gross of collateral pledged. OTC derivative assets and liabilities are recorded net of collateral pledged in our Consolidated Statements of Financial Condition. At August 31, 2026, cash collateral received and pledged was $569.5 million and $810.1 million, respectively.
(3)Derivative fair values include counterparty netting within product category.
(4)Amounts represent the netting of receivable balances with payable balances for the same counterparty within product category across maturity categories.
OTC derivative assets at August 31, 2026:
Counterparty credit quality (1):$ in thousands
A- or higher$294,515 
BBB- to BBB+74,645 
BB+ or lower330,152 
Unrated257,779 
Total$957,091 
(1)We utilize internal credit ratings determined by our Risk Management department. Credit ratings determined by Risk Management use methodologies that produce ratings generally consistent with those produced by external rating agencies.
Credit Related Derivative Contracts
External credit ratings of the underlyings or referenced assets for our written credit related derivative contracts:
August 31, 2026
External Credit Rating
$ in millionsInvestment GradeNon-investment GradeTotal Notional
Credit protection sold:
Index credit default swaps$422.4 $744.6 $1,167.0 
November 30, 2025
External Credit Rating
$ in millionsInvestment GradeNon-investment GradeTotal Notional
Credit protection sold:
Index credit default swaps$51.4 $873.2 $924.6 
Contingent Features
Certain derivative instruments contain provisions that require us to either post additional collateral or immediately settle any outstanding liability balances upon a specific event related to our credit, primarily downgrades in our credit ratings. The following table presents the aggregate fair value of all derivative instruments with such credit-risk-related contingent features that are in a net liability position, the collateral amounts we have posted or received in the normal course of business and the potential collateral we could have been required to return and/or post additionally to our counterparties if the credit-risk-related contingent features underlying these agreements were triggered:
$ in millionsAugust 31, 2026November 30, 2025
Derivative instrument liabilities with credit-risk-related contingent features$231.2 $107.3 
Collateral posted(44.2)(70.0)
Collateral received176.6 343.3 
Return of and additional collateral required in the event of a credit rating downgrade below investment grade (1)363.5 380.5 
(1)These potential outflows include initial margin received from counterparties at the execution of the derivative contract. The initial margin will be returned if counterparties elect to terminate the contract after a downgrade.