Reverse Repo

    Reverse Repo – is repurchasing of securities with an agreement to resell them at a higher price at a specified future rate. This is essentially just a loan of the security at a specific rate. Reverse repo is a term used to describe the opposite side of repo transaction. The party who sells and later repurchases a security is said to perform a repo. The other party who purchases and later resells the security is said to perform a reverse repo.