Asked by Jocelyn Espericueta on Jun 08, 2024
Verified
Which of the following are criteria for a bond to be labelled as a "Maple bond"?
A) The bond must be sold in the Canadian market by the Canadian government
B) The bond must be sold in the U.S. bond market by a Canadian company, or the Government of Canada
C) The bond must be sold by a foreign company or government in Canadian dollars, in the Canadian bond market
D) The bond must be sold on the Montreal Bourse.
Maple Bond
A Maple Bond is a debt security, denominated in Canadian dollars, issued by foreign companies or governments that are sold in Canada.
Canadian Bond Market
The marketplace where Canadian government and corporate bonds are issued and traded, reflecting Canada's economic condition and interest rates.
Canadian Market
The financial and economic market within Canada, encompassing various sectors, including the Toronto Stock Exchange (TSX).
- Understand the international bond market and the concept of currency risk in foreign bonds.
Verified Answer
VS
Valencia SimoneJun 10, 2024
Final Answer :
C
Explanation :
Maple bonds are defined by being issued by foreign companies or governments in Canadian dollars within the Canadian bond market, not by being issued by Canadian entities or in specific locations like the Montreal Bourse.
Learning Objectives
- Understand the international bond market and the concept of currency risk in foreign bonds.