Today's 2-day bond repo can earn 9 days' interest; 3- to 7-day tenors earn 10 days' interest

As the end of the third quarter of 2026 approaches and the National Day holiday draws near, a favorable window for trading exchange-traded bond-backed pledged repo reverse repurchase agreements (reverse repo) may have arrived.

Interest Accrual Highlights

According to relevant interest calculation rules, investors who execute a 2-day reverse repo on the Shanghai and Shenzhen exchanges today will accrue 9 days of interest. Meanwhile, those who opt for 3-day, 4-day, or 7-day reverse repo products will accrue 10 days of interest, making these maturities particularly cost-effective in terms of interest calculation days.

Seasonal Yield Trends

Historically, around month-end, quarter-end, year-end, and before long holidays, market liquidity tends to tighten, often driving reverse repo yields significantly higher than usual.

For example, on June 29, near the end of the second quarter this year, the annualized yield of the Shanghai 2-day reverse repo product surged over 68% intraday, peaking above 2%. The Shanghai 3-day reverse repo also saw a sharp spike, with its annualized yield reaching as high as 2% during the session.

Broader Market Context

In recent years, as overall domestic market interest rates have declined substantially, the yields on exchange-traded reverse repo products have also trended downward. However, yields on major investment and wealth management channels have fallen even more sharply. While reverse repo may not offer significant advantages on ordinary days, it still provides relatively attractive returns during key windows such as month-end, quarter-end, year-end, and before holidays.

Listed Companies Also Participate

Given the relative stability of bond-backed pledged repo reverse repo (including the well-known "treasury reverse repo"), many listed companies invest in these products for cash management, asset preservation, and safety.

• Lianjian Technology recently announced that, under strict risk control, it will use up to RMB 200 million of idle自有资金 to invest in safe, liquid wealth management products, including reverse repo.
• Tianwei Food disclosed that it uses idle raised funds to purchase principal-protected products such as reverse repo, structured deposits, and certificates of deposit.
• Quanyangquan announced in August that its board approved renaming "treasury reverse repo" to "bond-backed pledged repo reverse repo" in its investment authorization, in line with Shanghai Exchange rules. The company executed 7-day and 28-day Shanghai reverse repo products in August.

Reverse Repo Operation Guide

A. Minimum Investment Threshold

The minimum investment for bond-backed pledged repo reverse repo on both the Shanghai and Shenzhen exchanges is RMB 1,000.

B. Choosing the Right Maturity

Both exchanges offer 9 maturities: 1-day, 2-day, 3-day, 4-day, 7-day, 14-day, 28-day, 91-day, and 182-day, totaling 18 products. Choose based on your cash flow needs and yield expectations.

C. How to Place an Order

• Select "Sell" (not "Buy") when placing an order.
• Use the real-time market price displayed.
• Most brokerage platforms now feature a dedicated reverse repo trading zone for easy access.
• Many platforms also show how many days funds will be tied up and how many days of interest will be earned for each product.

D. When Will Funds Be Returned?

• Funds are automatically returned upon maturity — no reverse trade needed.
• On the maturity date, funds are available for trading but cannot be withdrawn until the next business day.
• If you have a subscription payment due on the maturity date, you can use the returned funds for that purpose.

E. Is There an Optimal Time to Trade?

There is no guaranteed "best" time. Intraday peak yields may appear in the morning or afternoon. However, based on historical patterns, yields often drop sharply near the end of the trading session, so it is advisable to avoid placing orders at the tail end of the session.

Shanghai Exchange Reverse Repo Products

| Product | Code | |---------|------| | 1-day (GC001) | 204001 | | 2-day (GC002) | 204002 | | 3-day (GC003) | 204003 | | 4-day (GC004) | 204004 | | 7-day (GC007) | 204007 | | 14-day (GC014) | 204014 | | 28-day (GC028) | 204028 | | 91-day (GC091) | 204091 | | 182-day (GC182) | 204182 |

Shenzhen Exchange Reverse Repo Products

| Product | Code | |---------|------| | 1-day (R-001) | 131810 | | 2-day (R-002) | 131811 | | 3-day (R-003) | 131800 | | 4-day (R-004) | 131809 | | 7-day (R-007) | 131801 | | 14-day (R-014) | 131802 | | 28-day (R-028) | 131803 | | 91-day (R-091) | 131805 | | 182-day (R-182) | 131806 |

Editor: Li Dan Proofreader: Zhao Yan

All original content on Securities Times platforms is protected by copyright. No reproduction or redistribution without written permission. For cooperation, contact Securities Times Assistant via WeChat ID: SecuritiesTimes.