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chhaya

chhaya (Querist)
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06 September 2013 In money market "wat is repo transactions? "

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013 It is sale and repurchase transaction executed on agreement basis. Repos are classified as a money-market instrument. They are usually used to raise short-term capital

For the party selling the security (and agreeing to repurchase it in the future) it is a repo; for the party on the other end of the transaction, (buying the security and agreeing to sell in the future) it is a reverse repurchase agreement.

A form of short-term borrowing for dealers in government securities. The dealer sells the government securities to investors, usually on an overnight basis, and buys them back the following day.

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