A repo is a temporary loan of bonds and is therefore an important lubricant in the financial system. In practical terms, this entails simultaneously agreeing on the sale and subsequent repurchase of a bond at a given future point in time, for example in two weeks. The sale and repurchase prices are determined so that compensation is obtained for the “loan" during this period. Lending of bonds creates added value for the Nuclear Waste Fund with a very low risk.
Uppdaterad av: Anna Major, 2011-05-05 15.45