Thai Futures Exchange to Trade Bond Futures Starting October 18
Thailand Futures Exchange PCL (TFEX) will trade bond futures, which will have government bonds as their underlying asset, from October 18 onwards. TFEX and the Thai Bond Market Association will exchange information on trading regulations and distribute information to investors for their prudent decision-making.
“TFEX is now ready for bond futures trading, as we have tested the related systems with the members since the end of September. In addition, TFEX has met with different investor groups, including commercial banks, foreign and domestic institutional investors to promote this new product, which received great attention,” said TFEX Managing Director Kesara Manchusree.
To support bond futures trading, TFEX and the Thai Bond Market Association (ThaiBMA) will exchange information on trading regulations, which will be used in both organizations.
ThaiBMA also provided TFEX with information on the trading of 4-6- year government bonds, which will be used as the underlying asset for the futures. Information on the indicative yields of underlying government bonds will be distributed to investors through TFEX’s website at www.tfex.co.th for their use, and will be published on October 18.
“This cooperation between TFEX and ThaiBMA is the first step of both organizations to jointly develop the derivatives and bond markets. This cooperation will support bond futures trading to be successful,” concluded Ms. Kesara.
The futures that will start trading on October 18 is the 5-year government bond futures, with a 5.00% interest rate, and worth THB1 million per contract. On the first trading day, there will be only two series of bond futures, with maturity dates of end- December 2010 and end- March 2011. For more information on the basket of eligible bonds, indicative yield and calculation methods, please visit www.tfex.co.th or call S-E-T Call Center at 0 2229 2222