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What is Exchange of Futures for Physicals on Chinese government Bond Futures

Exchange of futures for physicals (EFP) refers to the transaction wherein, upon the mutual agreement of the parties thereto, one party is the buyer of the Exchange contract and the seller of corresponding securities or related contracts, and the other party is the simultaneous seller of the Exchange contract and the buyer of corresponding securities or related contracts. EFP which supplements the centralized trading as an alternative trading mechanism will reduce the costs of executing trading strategies and satisfy the diversified needs of investors for price negotiation and flexible trading.