Commercial Paper (CP) is the corporate equivalent of a Treasury Bill and is used for short-term funding by companies.
Key Features:
Issued by corporations with high credit ratings.
Unsecured, short-term debt instrument (maturity up to 270 days).
Used to finance working capital or short-term obligations.
Comparison to Treasury Bills:
Treasury Bills (T-Bills) → Issued by governments (risk-free).
Commercial Paper → Issued by corporations (higher risk).
???? Reference: Bank of England (Commercial Paper Market), CISI Wealth & Investment Management.
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