The National Directory of Certified Public Accountants

Ask A CPA - Investments & Financial Planning

In A Money Market Fund , What Is A Banker'S Acceptance ?

A Banker's acceptance is a short term credit investment created by a nonfinancial firm and guaranteed by a bank as to payment. Acceptances are traded at discounts to face value in the secondary market. These instruments have been a popular investment for money market funds. They are commonly used in international transactions.

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