Bond forward

Bond forward

Bond forward transaction (hereinafter referred to as BFT for short) refer to the purchase and sale of subject bonds by both transaction parties (members in inter-bank market, all kinds of financial institutions generally) at the agreed rate and quantity on a certain agreed date in the future. Bond forward is the first derivative developed in national bond market. It will provide effective means of avoidance of risk and making profit for market members and is of great significance for effective discovery of bond market price and formation of complete and reasonable yield curve structure.