A futures contract is an agreement to buy or sell the specified asset of a specific volume at the predetermined price on a specific future date. Futures transactions were introduced to the financial market with a background where adoption of floating rate system for US dollar and interest-rate liberalization had triggered great fluctuations of interest rates and currencies. To avoid or minimize such market risks (hedge), financial futures instruments have been developed as risk-hedge tools, which is the start of financial derivatives.
Due to the series of interest-rate liberalization in Japan since 1980s, great demands of risk-hedge for Yen-based assets took place. To meet such demands, TFX was established in 1989 as a specialized exchange for financial derivative products. In order to improve user convenience, TFX has been challenging and realizing globally-standardized systems and schemes as a pioneering exchange in Japan.
Financial derivatives are still continuing to develop in both quality and variety, and new types of derivative products, such as options, interest-rate swaps, and hybrid derivative products, are being designed or created. As financial derivatives are also embedded into deposits, housing loans, bonds, etc., derivatives users are expanding indirectly to those who are not financial institutions. In addition, the fast spread of internet trading and the increase in the level of consciousness of managing individual assets result in the recent years’ general awareness of forex margin contracts. Upon the suggestions of the Financial Services Agency and the Financial System Council, TFX decided to list the forex margin contracts on its exchanges. Furthermore, in response to the enforcement of the Financial Instruments and Exchange Law in September 2007, TFX, offering the financial instruments markets that list the various kinds of financial products, has worked toward the improvement of convenience through the employment of the “global standard,” the development of new financial products, etc.

In order to ensure fair and efficient financial futures transactions on the TFX market, TFX members are required to meet financial and other criteria prescribed by TFX and maintain proper credit capability.
TFX members cover a broad range of financial sectors such as banks, securities companies, insurance companies, credit associations, futures brokers, foreign financial institutions, etc. Active participation of foreign members is a remarkable feature of the TFX market.
TFX has two types of members: Trading Members, who have the ability to execute trades, and Clearing Members, who have the ability to conduct clearing operations for financial futures contracts. Non-Clearing Members must entrust their clearing operations to Clearing Members. In the case of non-member investors, their orders and clearing are to be entrusted to TFX Members who are licensed financial futures brokers.