The first batch of 30-year treasury bond futures contracts was listed on the China Financial Futures Exchange (CFFEX) on Friday, serving to improve the Chinese government's ability to raise funds for projects that are crucial for national development.

These government bond futures feature low transaction costs and high liquidity, and are seen as a key tool to manage interest rate risks.

The introduction of 30-year treasury bond futures has improved the coverage of long-term government bonds in the futures market, according to Luo Xufeng, vice chairman of the China Futures Association. 

Luo added that investors will now have more diverse investment strategies and tools to choose from, meeting the needs of different market participants.

The move is also expected to help improve asset allocation and risk management capabilities of medium- and long-term institutional investors, wrote Dong Xu and Chen Jianheng, analysts from the fixed income research team at the China International Capital Corporation.

It also enhances the pricing efficiency of long-term government bonds, they added.

The first batch of 30-year treasury bond futures contracts available for trading includes three contracts dated: June, September, and December 2023. 

The margin requirement for each contract is 3.5 percent of the contract value. 

On the first day of trading, the price limit for each contract is set within 7 percent of the benchmark price, according to the CFFEX.

The first Chinese treasury bond futures were listed on the CFFEX back in 2013, since then, two-year, five-year, 10-year bond futures were introduced. 

Analysts say that they have become an important tool for hedging and arbitrage in the bond market, making positive contributions to the liquidity of the spot bond market and the development of a multi-layered capital market.