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Implied Repo Rate
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The maximum cost of financing a position which is consistent with or discounted by the return available from a cash/futures arbitrage position. For example, an investor evaluating a cash-and-carry trade, such as buying a stock portfolio and selling a stock index futures contract, will calculate the expected return (dividends plus futures basis) as a money market rate. The implied repo rate is the break-even financing rate for this arbitrage position. Also called Return to Hedged Portfolio (RHP).
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