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  • August 30, 2022
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Start Leg of a Repo

A repo leg that involves the delivery of collateral assets/ repo collateral (securities) against payment of an amount of money (the face value of the securities, which is the amount of loan). A start leg is the first leg of a repo (repurchase agreement, RP) that is carried out in order to initiate the transaction.

A repo can be perceived as a contract for the sale of a security (the collateral)- the first leg (i.e., opening leg/ front leg/ start leg)- subject to a simultaneously concluded forward agreement for the repurchase of the collateral or a similar security at an agreed date or on demand- the second leg (term leg/ return leg).


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