After the a long wait now it happened and China make its official
entry for the foreign investors in the
bond market. The Bond trading process is
operational for foreign investors with the name given to bond as “ Contact Bond”.
That’s move taken to bring the foreign investors in the
chines financial derivatives market. The Net worth of the Contact Bond is
approximately $ 90.00 Trillion. There market
is the world third biggest market but only 2% of bonds in the possession of the
foreign investors.
The move to open the chines market for the foreign investors
is started on March 01 and Now when the Hong Kong completes its 20 Years under
the China. The Contact bond were issued on that date. The reason behind to
issue the bonds is to reduce the cash out flow and increase the cash inflow in
the chines economy and give boom to its derivatives and financial market
through this activity.
The investors like this kind of bond from them due to two
main reason one is that the bond profit issued at the par stated rates and the
second is when the bond is mature its period the invest gets his complete invested
amount back. Initially the bond can be purchased by the Chines bond banks, Hong
Kong fund managers and through the insurance companies. The date for the investment is not announced till yet.
But the #HSBC Holding and the Bank of China Assets Management Unit both are the initially start their investment and business in these bonds.
The Foreign investors were more querulous before to make the investment in the chines
derivative markets because the China Currency Yuan’s is not stable and a system
like the financial derivatives and stocks is currently dissolved. The United
States Stock Index were agreed to
include the Chines local trading t in the last month in their market. Currently the Chines Yuan’s exchange rate
with respect to the dollar is 1$= 6.5Yuan’s approx.
But over all that’s a very positive and constructive effort
from China to make its cash inflows more better and giving more strength to its
Financial Stock and derivatives market through the Contact Bonds. With thanks
to #BBC URDU Service.
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