The basis point value refers to the absolute amount of bond price change caused by each basis point change in interest rate (0.0 1 percentage point). Because the basis point value of treasury bond futures contract is about equal to the basis point value of the cheapest deliverable treasury bond divided by its conversion factor, the number of treasury bond futures contracts required for hedging can be obtained by comparing the basis point values of bond portfolio and treasury bond futures contract. The formula is as follows: the number of treasury bond futures contracts required for hedging = bond portfolio price fluctuation ÷ futures contract price fluctuation = BPV÷[ bond portfolio ÷ [(futures contract face value ÷ 100)÷CTD conversion factor× CTD basis point value].