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Basic Question 4 of 9
A security dealer borrows funds at the call money rate to finance the holding of security inventory. This transaction is an example of ______.
B. a reverse repurchase agreement
C. margin buying
A. a term repurchase agreement
B. a reverse repurchase agreement
C. margin buying
User Contributed Comments 3
| User | Comment |
|---|---|
| kalps | call money rate - rate at which the broker will lend funds to a trader - always on the margin buying |
| Gina | the call money rate is the rate at which teh broker borrows funds from the bank. broker lends the money at the call money rate & surcharge. |
| khalifa92 | this is leveraged short position |
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Barnes
Learning Outcome Statements
describe repurchase agreements(repos), their uses, and their benefits and risks
CFA® 2025 Level I Curriculum, Volume 4, Module 4.