Which of the following statements about Eurobonds is/are true?
I. The issuer chooses the currency of denomination.
II. Spreads on firm commitment offers are lower for Eurobonds than for U.S. bonds.
III. Eurobonds typically have denomination of $5,000 and $10,000.
IV. Eurobonds are bearer bonds.

Question

Quizplus · Accepted Answer

I. The issuer chooses the currency of denomination - This statement is true. Eurobonds are issued in currencies other than the issuer's domestic currency. The choice of currency depends on the issuer's preference and the demand in the market.
II. Spreads on firm commitment offers are lower for Eurobonds than for U.S. bonds - This statement is not true. The spreads on firm commitment offers are typically higher for Eurobonds than for U.S. bonds due to the additional currency risk.
III. Eurobonds typically have denomination of $5,000 and $10,000 - This statement is true. Eurobonds are typically issued in large denominations, ranging from $5,000 to $10,000 or more, which makes them accessible to institutional investors.
IV. Eurobonds are bearer bonds - This statement is true. Eurobonds are usually issued in bearer form, which means that the owner of the bond is the person who holds it, and ownership can be transferred by physical delivery.

Which of the Following Statements About Eurobonds Is/are True