Timeline for Market Makers how can they sell an asset they don't have
Current License: CC BY-SA 4.0
4 events
| when toggle format | what | by | license | comment | |
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| Nov 17, 2023 at 21:31 | comment | added | hjkhkjhjk | Hmmm ok but when the bank borrows a bond through the repo market or a securities lending agreement to fulfill a client's purchase order, it has an obligation to return the bond to the lender. so how does it work in this case? it rolls over the repo agreement? | |
| Nov 17, 2023 at 18:48 | comment | added | user68819 | No. You don't buy the bond at mid. You borrow the bond from a willing counterpart. For that you give him cash equal to the dirty price of the bond and he will pay you an interest rate on that cash to term...where you must then return him the bond and you get the cash back with interest. | |
| Nov 17, 2023 at 18:37 | comment | added | hjkhkjhjk | Thank you for your response! So it's able through the repo market to buy the bond at the mid price so that it can made profit? Do you know where I can read more about this in details? Thank you! | |
| Nov 17, 2023 at 6:49 | history | answered | user68819 | CC BY-SA 4.0 |