HKEX 5-Year China Government Bond Futures

The only China Government Bond Futures in the offshore market — an RMB-denominated tool for managing offshore interest rate risk.

The HKEX 5-Year China Government Bond (CGB) Futures is an offshore interest rate risk management instrument referencing onshore Chinese Government Bonds. It is the only China Government Bond Futures currently available in the offshore market, giving international investors direct access to RMB rates exposure through a listed, exchange-traded contract.

The contract is traded and settled entirely in Renminbi. It is cash-settled against a basket of onshore five-year China Government Bonds carrying a 3% notional coupon with annual payments, and each contract has a size of RMB 500,000. Pricing is quoted as a percentage of contract size to three decimal places, with a minimum fluctuation of 0.005% (RMB 25 per contract).

The two nearest quarter months (March, June, September and December) are available for trading, from 9:30 a.m. to 4:30 p.m. Hong Kong time. The contract can also be traded on Hong Kong public holidays, except New Year's Day, extending risk management coverage beyond the local trading calendar. It is designed for institutional participants managing offshore RMB-denominated fixed income portfolios who need to hedge or express a view on Chinese government bond yields.

Key Benefits

• The only China Government Bond Futures in the offshore market
  • Exchange-traded access to onshore China Government Bond yields, available nowhere else offshore.
     
• A tool to manage RMB interest rate risk
  • Hedge duration and interest rate exposure on Renminbi-denominated fixed income positions.
     
• An instrument to gain RMB-denominated bond exposure
  • Take long or short positions on Chinese government bonds without holding the underlying securities.
     
• Traded and settled in RMB
  • Pricing, margin and settlement are all in Renminbi, matching the currency of the underlying risk.
     
• Cash-settled contract priced via a basket of China Government Bonds
  • Settled for difference against a basket of onshore five-year CGBs, with no physical delivery obligation.
     
• Tradable on Hong Kong public holidays (except New Year's Day)
  • Extends risk management coverage beyond the local trading calendar.
     

Contract Specifications

Source: HKEX

This advertisement has not been reviewed by the Monetary Authority of Singapore.
 

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