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Can someone either direct me to information on or provide a good explanation of how a repurchase agreement works?



Repo (Repurchase Agreement)
A contract in which the seller of securities, such as Treasury Bills, agrees to buy them back at a specified time and price. also called repurchase agreement or buyback.

Repos are very short-term secured loans disguised as a sale and repurchase agreement. In a typical repo, the borrower "sells" government securities to a borrower, with an agreement to purchase them back the next day for a slightly higher price. A term repo may run as long as 30 days.

For more details:

Repurchase and Matched-Sale Transactions

Keith O'Malley

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