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repos

  1. K

    How do repos introduce leverage?

    I have heard that repos can be used to gain leverage, particularly within hedge funds. However, if repo sellers (who borrow cash) have to post collateral, and the value of collateral is reduced via a haircut, wouldn't this in effect be the opposite of leverage? i.e. repo sellers would be getting...
  2. Nicole Seaman

    P2.T10.20.7. Beyond LIBOR

    Learning objectives: Describe the features comprising an ideal benchmark. Examine the issues that led to the replacement of LIBOR as the reference rate. Examine the risks inherent in basing risk-free rates (RFR’s) on transactions in the repo market Questions: 20.7.1. According to the Bank for...
  3. Nicole Seaman

    P2.T7.513. Repurchase agreements (repos, Tuckman)

    Learning outcomes: Describe the mechanics of repurchase agreements (repos)and calculate the settlement for a repo transaction. Explain common motivations for entering into repos, including their use in cash management and liquidity management. Questions: 513.1. At initiation of a repurchase...
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