An agreement with a commitment by the seller (dealer) to buy a security back from the purchaser (customer) at a specified price at a designated future date. Also called a repo, it represents a collateralized short-term loan for which, where the collateral may be a Treasury security, money market instrument, federal agency security, or mortgage-backed security. From the purchaser's (customer's) perspective, the deal is reported as a reverse repo.
Nearby TermsRepricing Reproducible assets Repurchase agreement Repurchase of stock Required minimum distribution (RMD)
Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University