open repo(redirected from Open Repos)
A practice in which a bank or other financial institution buys securities with the proviso that the seller repurchases the same securities for an agreed-upon price on an unspecified day. Because the date is unspecified, either party could end the arrangement at any time. Investors and financial institutions do this in order to raise short-term capital. Interest rates are higher on open repos than on overnight repos to compensate for the uncertainty on how long the arrangement will last.
A repurchase agreement without a fixed term.