China To Launch Government Bond Futures Trading Simulation

David Nealis at The China Financial Futures Exchange

This Dow Jones article is another great example of how the Chinese financial system is maturing. If your firm is looking for growth opportunities then this is one of the markets you need to be entering. – David Nealis

China To Launch Government Bond Futures Trading Simulation

SHANGHAI (Dow Jones)--China is on track to reintroduce government bond futures, a major financial derivatives instrument banned 17 years ago after a trading scandal, a person familiar with the matter told Dow Jones Newswires.

The China Financial Futures Exchange has recently issued a notice asking select firms to begin technical preparations and training for the pilot program, the person said. Yong An Futures Co., a Hangzhou-based brokerage, is one of the firms receiving the notice, the person said, without providing further details. A spokesman at China Financial Futures Exchange declined to comment.

Allowing government bond futures to be resurrected since being banned in 1995 would expand the scope and depth of China's already huge fixed income market, where liquidity is abundant but pricing remains less efficient due to the shortage of effective hedging tools.