- CFA Exams
- CFA Level I Exam
- Study Session 14. Fixed Income (1)
- Reading 43. Fixed-Income Markets: Issuance, Trading, and Funding
- Subject 5. Short-Term Funding Alternatives Available to Banks
CFA Practice Question
In a repo, any coupon paid by the security during the repurchase agreement belongs to ______.
B. the lender
C. the broker
A. the borrower
B. the lender
C. the broker
Correct Answer: A
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 |