Ten and thirty-year Bunds represent the long end of the German Government yield curve. Ten-year Bunds account for over 40 % and thirty-year Bunds for over 14% of the Federal Government’s debt portfolio in 2011.

Primary Market

Since 2010 three (afore two) new ten-year Bunds are issued each year, each of which is  reopened two to three times and reaches peak volumes of up to € 27 billion. Thirty-year bonds are usually issued twice a year, with one new issue roughly every two years. Ten and thirty-year Bunds account for 21% of the annual issuance volume (2011).

Secondary Market

There are more than 30 Bunds in circulation, accounting for up roughly half of the outstanding German Government securities tradable  in the secondary market. About two-thirds have volumes in circulation of over € 20 billion. In 2010, the total volume outstanding averaged over € 620 billion. According to Finance Agency data, in the secondary market for German Government securities Bunds accounted for a total share of over 50% of trading volume and for over 10% of the net volume, based on  the absolute positions reported  in 2008 (purchases less sales of reporting member banks of the Bund Issues Auction Group). Ten-year Bunds are the flagship product at the secondary level of the  German Government bond market.

Details of the database and the methodology used by the  Finance Agency for its secondary market evaluations can be found in the section entitled secondary market.

Stripping

Additional investment opportunities have been available  since the introduction of “Stripping” of ten and thirty-year Bunds in 1997, allowing for these issues’ par value (principal) and interest coupon to  be traded separately (from € 50,000 upwards, minimum denomination € 0.01). Stripping of the principal and coupon claims on behalf of the bondholder is the responsibility of the institution with which the securities are held in custody. It is also possible to reconstruct coupon and principal strips into a bond, but this is reserved for credit institutions for their own proprietary holdings. Coupon strips with the same maturity are grouped under a single ISIN or security code number.

Characteristics

Standardized interest and principal due dates on 4 January, 4 July and beginning in 2010 on 4 September of each year; redemption at par; interest calculated on an actual/365 or actual/366 basis; not redeemable prematurely and not callable by the issuer.