Which one of the following statements concerning a global view of the bond market is correct?
A) The United States today accounts for about seventy-five percent of the available fixed- income securities worldwide.
B) U.S. pay bonds distribute both interest and principal payments in euros.
C) Foreign bonds, like junk bonds, have high default risk.
D) Exchange rate fluctuations influence the returns earned on foreign-pay bond holdings.

Question

Quizplus · Accepted Answer

Exchange rate fluctuations can significantly impact the returns on foreign-pay bond holdings because the value of the foreign currency in which the interest and principal payments are made can vary relative to the investor's home currency.

Which One of the Following Statements Concerning a Global View