Inter-bank Bond Market Of China Research On Market-maker System Development Direction

As we all know, Market-maker Rule is internationally recognized OTC market transactions. In improving market liquidity, maintaining price stability of securities and enhancing market transparency, it played a huge role. As the development of inter-bank bond market and continued expansion of the scale of the market system, it provides a solid foundation to found Market-maker Rule, Coupled with Market-maker Rule can enhance market liquidity and transaction quality. Therefore, in a short few years time, the inter-bank bond market has been across the system from Bilateral Quotations Maker Rule to Market-maker Rule. And it is constantly exploring and learning from the process of gradually moving toward perfection and maturity.Market-makers in Inter-bank Bond Market of China, they bear part obligations of bilateral quotations, and it achieved some results. But there are still some problems and risks, such as limited capacity to making market, the higher cost, imperfections of quotation system (monopoly quotations), existence of clearing model and government supervision and policy support, and so on.Base on Market-maker Rule for the presence of problems, this article notes some recommendations and orientation on the development of Market-Maker, such as a sound system, the introduction of affirmative Market-maker measures, optimizing the structure of the bond, curbing monopolies quotations, providing for the wider introduction of cost and management of interest rate derivatives, improving inter-bank market transactions settlement patterns, strengthening the regulation of Market-maker and their capacity to deal with risks and so on. Particularly we should unify inter-bank bond market and transaction bond market. Introducing Marker-Maker Rule in the competitive market or introducing competitive trading rule in Market-maker Rule, which would create Mixed-trading Rule.In this part of the quantitative research, as the two representatives of the bond market, we choose "inter-bank bond market and the bond market collapse Exchange trading volume of bonds Trust" and other factors. And we should analyses its delivery volume for the whole bond market, thus judge the size of the role on the bond market across-two-markets transactions. In order to determined the feasibility of merging the two bond markets. It provides a viable background support for Mixed-trading Rule that is made of Marker-maker Rule and Price-competitive Rule.