Bond Index Futures
Bond Index Futures are derivatives instruments that track the JSE’s Bond Indices and give investors exposure to an underlying basket of Government Bonds listed on the JSE. Bond Index Futures are cash settled and can be easily accessed via JSE Interest Rate members.
Who should use this?
Bond Index Futures are used by both international and South African institutional investors seeking portfolio diversification and exposure to the South African Bond Market through a basket of Bonds. Individual investors with a high level of knowledge of Interest Rate Derivatives can also participate. Investors can go long or go short as they see fit.
- Exposure is spread over a range of Bonds lessening the risk of default
- Exposure is geared
- The JSE guarantees settlement
- As with any Derivatives trading, losses may exceed your initial investment. Given the scope for loss, only experienced investors or investors guided by an experienced broker should participate in this market.
How to get it:
To use Bond Index Futures, investors need to register as a client with an authorised member firm, deposit the required initial margin and sell or buy according to their needs.