ACI
3I0-012 · Question #6
A bond is trading 50 basis points special for 1 week, while the 1-week GC repo rate is 3.25%. If you held GBP 10,500,000.00 of this bond, what would be the cost of borrowing against it in the repo…
The correct answer is C. GBP 5,537.67. See the full explanation below for the reasoning.
Question
A bond is trading 50 basis points special for 1 week, while the 1-week GC repo rate is 3.25%. If you held GBP 10,500,000.00 of this bond, what would be the cost of borrowing against it in the repo market?
Options
- AGBP 7,551.37
- BGBP 6,544.52
- CGBP 5,537.67
- DGBP 1,006.85
How the community answered
(66 responses)- A3% (2)
- B5% (3)
- C85% (56)
- D8% (5)
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