In a Reverse Repo (Also Known as a Matched Sale

question 7

True/False

In a reverse repo (also known as a matched sale or a matched sale-purchase transaction), the Fed sells securities and makes a commitment to buy them back at a higher price later.

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Definitions:

Due Diligence Defense

A legal defense in which the accused shows that they took all possible precautions and conducted thorough research or investigation before making a decision.

Registration Statement

A set of documents submitted to a regulatory authority, detailing the specifics of a security offering to the public.

Prospectus

An official document that a company files with the SEC that provides details about an investment offering for sale to the public.

Short-Swing Profits

Profits earned by corporate insiders through buying and selling their own company's stock within a short period, which are subject to regulatory scrutiny and specific rules.