Friday, September 18, 2009

sources of Dealer financing

Where government security dealers do derives most of their funds to purchase and carry securities? Commercial banks are the largest single source of dealer funds, year in and year out. Indeed, half A dozen of the largest dealers are really dealer departments housed in some of the nation‘s largest banks. However, non-financial business corporations are the most rapidly growing source of funds for major securities dealers. Many industrial corporations. Today find the dealer loan market a convenient and safe way to dispose of temporarily idle monies. With wire transfer of funds between banks readily available, a company can lend a dealer millions of dollars in idle cash and recover those funds in a matter of hours if a cash emergency rears its head.

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