Japan Exchange Group: Celebrating 30 Years Of JGB Futures

30 years ago on October 19, 1985, 10-year JGB futures were launched on the TSE market to provide investors with a means to mitigate risk from bond price fluctuations as outstanding JGB issuance increased and interest rates were liberalized. 

Since then, demand for JGB derivatives has grown steadily with the launch of 10-year JGB futures options, 20-year JGB futures, 5-year JGB futures, and mini 10-year JGB futures contracts. Besides product launches, we constantly revised the market rules and upgraded the matching engine to enhance the market, making notable developments such as introducing spread trading, off-auction trading, and the give-up system. 

Mr. Hiromi Yamaji, President & CEO of Osaka Exchange (OSE), remarked on the 30-year milestone, “Since setting a landmark as Japan's first financial futures contract, the JGB derivatives market has developed with the times, refining its trading rules to build up a high level of liquidity. Today, JGB derivatives are considered major Japanese interest rate products by investors worldwide.”

‎ Recognizing the need to accommodate changing demands from recent growth in participation by foreign investors and increasingly sophisticated trading techniques, OSE has begun jointly calculating and publishing the S&P/JPX JGB VIX Index. After the launch of the next derivatives trading system (next J-GATE), planned in the middle of 2016, OSE will revise its trading rules and extend the night session from 3:00 am to 5:30 am to allow investors to trade JGB derivatives almost throughout the entire day.

As we celebrate 30 years of JGB futures, we hope to enjoy your continued support and cooperation in our endeavors to improve the stability, reliability, and convenience of the JGB derivatives market.