Comcast 2013 Annual Report Download - page 81

Table of Contents
Equity Price Risk Management
Comcast is exposed to the market risk of changes in the equity prices of its investments in marketable securities. Comcast enters
into various derivative transactions in accordance with its policies to manage the volatility related to these exposures. Through
market value and sensitivity analyses, Comcast monitors its equity price risk exposures to ensure that the instruments are matched
with the underlying assets or liabilities, reduce its risks relating to equity prices, and maintain a high correlation to the risk inherent
in the hedged item.
To limit Comcast’
s exposure to and the benefits from price fluctuations in the common stock of some of its investments, it uses
equity derivative financial instruments. These derivative financial instruments, which are accounted for at fair value, may include
equity collar agreements, prepaid forward sale agreements and indexed debt instruments.
In 2013 and 2012, the changes in the fair value of the investments that Comcast accounted for as available-for-
sale or trading
securities were substantially offset by the changes in the fair values of the equity derivative financial instruments. See Note 6 to
Comcast’s consolidated financial statements for additional information on its investments and investment income (loss), net.
Counterparty Credit Risk Management
Comcast and NBCUniversal manage the credit risks associated with our derivative financial instruments through diversification and
the evaluation and monitoring of the creditworthiness of the counterparties. Although we may be exposed to losses in the event of
nonperformance by the counterparties, we do not expect such losses, if any, to be significant. Comcast has agreements with
certain counterparties that include collateral provisions. These provisions require a party with an aggregate unrealized loss position
in excess of certain thresholds to post cash collateral for the amount in excess of the threshold. The threshold levels in our
collateral agreements are based on our and the counterparties’
credit ratings. As of December 31, 2013 and 2012, Comcast was
not required to post collateral under the terms of these agreements. As of December 31, 2013, the collateral that Comcast held
from certain of its counterparties under the terms of these agreements was not material.
Comcast 2013 Annual Report on Form 10
-
K
76