Gilt-Edged Market

A final word on market convention: as repo rates refer to bids and offers for stock, a

corporate counterparty that wished to invest a specific amount of cash must clearly state

that it has a cash amount to invest. So for example, if we assume that a corporate has

£50 million cash to lend, simply lifting a market maker's screen offer in ``£50 million GC''

may see it receive more (or less) than £50 million-worth of stock, depending on the price of

the collateral. Therefore it must clearly state beforehand that it has an exact amount of cash

to lend, to avoid confusion.

6.8 Repo netting and the LCH RepoClear system

The domestic US dollar repo market