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Basic Question 5 of 9

In a repo, any coupon paid by the security during the repurchase agreement belongs to ______.

A. the borrower
B. the lender
C. the broker
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User Contributed Comments 4

User Comment
bmueller82 Why isn't it the lender. Isn't he holding the security during the repurchase agreement?
HolzGe1 From the textbook:
"Note that any coupon paid by the security during the repurchase agreement belongs to the seller of the security (i.e., the borrower of cash)."
davidt876 It would add too much complexity to the agreement to have to factor in the coupon
unknown Borrower of Money
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I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz

Tamara Schultz

Learning Outcome Statements

describe repurchase agreements(repos), their uses, and their benefits and risks

CFA® 2025 Level I Curriculum, Volume 4, Module 4.