Benchmark rates are rates or the prices of instruments that are traded in the market which are used for pricing of other instruments. These rates or prices are used as benchmark for floating rate instruments. In the fixed income market, it is an interest rate that the market respects and closely watches. Typically a benchmark rate should satisfy the following [...]
In the fast changing financial scenario, it has become imperative for the corporate sector to devise hybrid debt instruments for raising funds from the market. A brief discussion is made here about the hybrid debt instruments of finance. Hybrid Debt Instrument # 1. Zero Coupon Bond (ZCB): ZCBs do not pay out any interest prior to maturity. These bonds are [...]
In this article we will discuss about:- 1. Meaning of Repo and Reverse Repo 2. Calculating Settlement Amounts in Repo Transactions 3. Uses of Repo 4. Repo Markets in India. Meaning of Repo and Reverse Repo: A repo is a transaction in which two parties agree to sell and repurchase the same security. Under such an agreement the seller sells [...]