Podcast
Questions and Answers
Who are the issuers of money market securities?
Who are the issuers of money market securities?
The issuers of money market securities include central and local governments, local authorities, large corporations, and banks.
Which money market securities are tradable in a secondary market?
Which money market securities are tradable in a secondary market?
All money market securities are tradable in a secondary market, except for term and call deposits.
What is LIBOR and why is the rate of interest on a term deposit likely to be higher than that on a call deposit?
What is LIBOR and why is the rate of interest on a term deposit likely to be higher than that on a call deposit?
LIBOR is a reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the London wholesale money market. The rate of interest on a term deposit is likely to be higher than that on a call deposit to compensate for the lack of access to funds before maturity, which reduces flexibility for the lender.
