Intraday Repo

Definition ∞ Intraday repo refers to a repurchase agreement that is executed and settled within the same trading day. In this financial transaction, one party sells securities to another with an agreement to buy them back later on the same day, typically at a slightly higher price. This mechanism is primarily used by financial institutions to manage short-term liquidity needs and optimize their cash positions during the trading day. It provides a flexible tool for short-term financing.
Context ∞ The concept of intraday repo is gaining relevance in discussions around the integration of traditional financial markets with digital asset liquidity solutions. While primarily a traditional finance tool, its principles could be applied to digital collateral management and real-time settlement within blockchain-based financial systems. Future developments may explore how tokenized assets and distributed ledger technology could streamline or enhance the efficiency of such short-duration liquidity operations.