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Composition of national debt market
The national debt market can be divided into two parts according to the level or stage of national debt trading: one is the national debt issuance market; The second is the national debt circulation market. The national debt issuance market refers to the issuing place of national debt, also known as the primary market or primary market of national debt, which is the initial link of national debt trading. Generally speaking, it is a transaction between the government and securities underwriting institutions, such as banks, financial institutions and securities brokers. Usually, securities underwriting institutions buy all the issued government bonds at one time. The national debt circulation market, also known as the secondary market of national debt, is the second stage of national debt trading. Generally speaking, it is a transaction between the national debt underwriting institution and the subscriber, including the transaction between the national debt holder and the government or the national debt subscriber. It is divided into two categories: on-site trading and off-site trading. Trading in the stock exchange refers to trading in the designated business hall of the exchange, and trading outside the business hall of the exchange is OTC. 198 1 at the beginning of China's resumption of issuing treasury bonds, the government mainly adopted administrative apportionment, and the financial department directly sold treasury bonds to subscribers (mainly enterprises and individual residents), and implemented semi-apportionment. China's real national debt issuance market began at 199 1. In April of that year, the Ministry of Finance organized a national debt underwriting syndicate for the first time, and more than 70 national debt intermediaries participated in the underwriting of national debt. 1993, establish a first-class self-operated dealer system. At that time, 19 financial institutions participated in underwriting 1993 three-phase book-entry treasury bonds.

The so-called primary dealers refer to banks, securities companies and other non-bank financial institutions with certain conditions and approved by the Ministry of Finance. They can directly underwrite and bid for national debt to the Ministry of Finance, and promote the issuance of national debt through distribution and retail business, so as to maintain the smooth operation of the national debt issuance market. From 65438 to 0994, on the basis of previous reforms, the issuance of treasury bonds focused on diversification, and short-term treasury bonds of half a year and one year and unlisted savings bonds were introduced. 1996, the government began to issue bonds by tender, and the degree of marketization was greatly improved. For example, discounted government bonds are subject to price bidding, interest-bearing government bonds are subject to yield bidding, and bonds with determined interest rates and issuance conditions are subject to bearer bidding by stages. At the same time, seven kinds of treasury bonds with different maturities, such as 3 months, 6 months, 1 year, 3 years, 7 years and1year, have been introduced, among which 3 months, 7 years and1year are new varieties, 3 months is the shortest treasury bond at present, and 7 years and1year are at present.

After several years of development, China's national debt issuance market has basically taken shape. Its basic structure is as follows: (1) Selling marketable government bonds to the first-class underwriter of government bonds by means of differential bidding; Selling unlisted savings bonds (voucher-type government bonds) to underwriters such as commercial banks and government bond institutions affiliated to the financial department; Selling targeted treasury bonds to social security institutions and insurance companies through targeted fundraising. This distribution market structure is a combination of various distribution modes, which adapts to the current reality in China. During the seven years from 198 1 to 1988, there was no secondary market for national debt. Bonds terminate the purchasing power of bondholders within a certain period of time, which makes bondholders feel inconvenient. Therefore, it is urgent to solve the problem of realizing the bonds in the hands of residents. 1985 has a discount method, but the effect is not good. Therefore, the establishment of the national debt circulation market is an important way to facilitate residents and prevent the expansion of purchasing power.

Starting from 1988, China first allowed 7 cities, and then approved 54 cities to carry out the pilot work of treasury bills circulation and transfer. 1985 and 1986 treasury bills were approved for listing, and the financial departments and banking departments in the pilot areas set up securities companies to participate in circulation and transfer. The pilot is mainly conducted in securities intermediaries, so the circulation market of China's national debt starts from over-the-counter trading. 199 1 the scope of the national debt circulation market has been further expanded, allowing 400 cities above the prefecture level to carry out the circulation and transfer of national debt. At the same time, the success of national debt underwriting and the rapid increase of securities institutions have promoted the activity of OTC market transactions. As of 1993, the cumulative turnover of over-the-counter transactions reached 45 billion yuan, which was greater than that of on-site transactions at that time. However, due to the inherent weaknesses of OTC: irregular management, poor reputation and serious breach of contract, it is prone to liquidation and delivery crisis; The uniformity of OTC market is poor, the regional quotation spread is large, and the bid-ask spread is large; Many OTC markets have poor liquidity and so on. These factors led to the continuous shrinkage of OTC market transactions, reaching 1996, accounting for less than 10%. At the same time, although the floor trading market started late, it developed steadily due to its own advantages. At present, on-site trading is mainly concentrated in four places: Shanghai Stock Exchange, Shenzhen Stock Exchange, Wuhan Treasury Trading Center (established in 1992, specializing in the transfer of treasury bonds) and National Securities Trading Automatic Quotation Center. Due to relatively standardized management, good reputation and strong market unity, these places have ensured the steady growth of on-site trading volume, with 1996 accounting for more than 90% of the total national treasury bond transactions. At present, the structure of China's national debt circulation market has formed a basic pattern, which is mainly based on on-site transactions and supplemented by off-site transactions at securities outlets, which is basically in line with China's current reality.

From 199 1, the national debt repurchase market appeared in China. The so-called national debt repurchase means that the holder of national debt signs an agreement with the buyer while selling a national debt, and promises to buy back the same national debt at the agreed amount after the agreed time limit. If the transaction procedure is contrary, it is called reverse repurchase of government bonds. Treasury bond repurchase is a kind of securities lending and financing activity in the form of treasury bond transaction, which has the nature of financial derivatives. Treasury bond repurchase provides financing for holders and investors, is the main channel for investors to obtain short-term funds, and also provides tools for open market operations. Therefore, the national debt repurchase business plays an important role in promoting the development of the national debt market. However, the irregularity of the national debt repurchase market will also have a negative impact. If the phenomenon of short selling is serious, the repurchase business is not guaranteed by actual bonds, the sources of repurchase funds are chaotic, and the funds are improperly used, which will impact the financial order. China rectified the national debt repurchase market on 1995. After the rectification, the national debt repurchase market gradually entered the right track. In order to develop the national debt market in an orderly way, we must first consolidate and develop the repurchase market of the exchange; Secondly, it is necessary to establish a standardized on-site repurchase market, establish a unified custody clearing system, put an end to short selling and crack down on market segmentation; Finally, the central bank stepped up its open market operations, and the repurchase of government bonds became an effective tool for open market operations.

China once launched the domestic market in 1992 and 10. The so-called futures trading is relative to spot trading, which is characterized by the separation of the transfer of bond ownership between buyers and sellers and the delivery time of payment. After the transaction contract is signed, both parties do not immediately pay for the delivery of the bonds, but only pay the buyer at the agreed delivery time, and the seller delivers the bonds. A futures contract has four elements: the agreed time, the agreed price, the agreed variety of national debt and the agreed number of transactions, and the agreed variety is the target national debt for futures trading. Treasury bond futures are the product of the development of the treasury bond spot market to a certain stage, which has unique functions:

First, display and guide the national debt price or the national debt market. The treasury bond futures market is an open bidding between buyers and sellers, which makes the treasury bond price change with the supply and demand situation and pass it on the market. Because the futures market is the will of many buyers and sellers, it is the most representative price and has a guiding role in the current and future price trends.

The second is hedging. Investors in treasury bonds can trade a certain variety of treasury bonds in the futures market and the spot market at the same time, so as to supplement or offset the profits and losses of the futures market and the spot market, thus realizing the preservation of value.

The third is speculative profit. Investors in treasury bonds futures can also speculate between different kinds of bonds in the futures market, or between the spot market and the futures market, which provides investors with more hedging opportunities. 1992 at the beginning of the launch of treasury bonds futures in China, investors reacted indifferently. With the development of the securities market and the enhancement of people's awareness of financial management, Shanghai Stock Exchange officially launched standardized treasury bond futures contracts on June 1993+00. Since then, treasury bonds futures have been more and more recognized by investors, and the trading volume has been expanding day by day, from less than 1 billion yuan to more than 1000 billion yuan. However, due to the immature development conditions of China's treasury bond futures market and the lagging construction of laws and regulations, many serious violations occurred between the second half of 1994 and the first half of 1995. It is still difficult to get on the right track after the regulatory authorities have taken measures such as increasing the margin ratio, implementing the daily limit board system and stipulating the maximum position, so the State Council announced the suspension of the national debt futures pilot 1995 in May.