Dealers in the commercial paper

The market is relatively concentrated among a handful of dealers who account for the bulk of all trading activity. the top commercial paper dealers today include Goldman Sachs&co.;A.G. Becker,Inc.; the first Boston Corporation, Lehman Brothers; and Merrill Lynch, Pierce, Fenner and Smith. Dealers maintain inventories of unsold new issues or repurchased paper but usually expect to turn over all their holdings within a week to 10 days. Like dealers in U.S. government securities, commercial-paper dealers draw upon repurchase agreements (RPs) and demand loans from banks to help finance their inventory positions. They pay interest rates which usually are only a few basis points higher than on RPs collateralized by U.S. treasury securities.