7

Repos, Buy / Sell-backs and Securities Lending

“Although the legal benefit of the collateral passes from seller to buyer for the period of the repo, the economic benefit remains with the seller.”

Introduction

Classic repo

Margin calls

General collateral (GC) and specials

Other features

Buy / Sell-back

Close-out and repricing

Securities lending

Comparison between the different transactions

Uses of repo and securities lending

Exercises

Where you see the WWW icon in the following, this calculation is available already programmed in Microsoft® Excel to be used online or downloaded (or copied and pasted) for your own use. Go to www.markets-international.com and click ‘Calculations’.

INTRODUCTION

“Repo” is short for “sale and repurchase ...

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