Buy Back Agreement Crossword Clue
Are you a crossword enthusiast looking for the answer to the clue “buy back agreement”? Look no further! This crossword clue refers to a financial contract known as a buyback agreement.
A buyback agreement, also known as a repurchase agreement or a repo, is a transaction in which one party sells a security (usually bonds) to another party with a promise to buy the security back at a later date. The seller of the security agrees to repurchase the security at a fixed price, plus interest, within a short period of time, typically ranging from overnight to a few weeks.
Buyback agreements are commonly used by banks and other financial institutions to raise short-term funding. These institutions can borrow money by selling securities they own, with the understanding that they will buy them back at a later date. This allows them to meet their short-term cash needs while still maintaining ownership of their securities.
Investors also commonly use buyback agreements as a way to earn a return on their cash. By lending money to a financial institution in exchange for securities (and interest), they can earn a return on their investment without taking on too much risk.
So, whether you were able to solve the crossword clue or not, now you know what a buyback agreement is and how it is used. Happy puzzling!