Final answer:
The incorrect statement regarding Eurodollar bonds is that they 'May never trade in the U.S. markets,' as they can trade in the U.S. markets post-issuance. Eurodollar bonds differ from U.S. Treasury Bonds, which have a strong global reputation for stability and low risk.
Step-by-step explanation:
The question pertains to Eurodollar bonds, which are financial instruments that multinational corporations and sovereign entities use. Specifically, the statement that is NOT true about a Eurodollar bond is that it 'May never trade in the U.S. markets' as there is nothing fundamentally restricting these bonds from being traded in the U.S. markets after issuance overseas.
Unlike United States federal Treasury Bonds that are globally recognized for their security and reliability over the past two centuries and are in high demand even when interest rates are low, Eurodollar bonds operate slightly differently.
It is noteworthy that U.S. federal bonds are bought by foreigners extensively, which shows the interconnected nature of international finance and the trust in U.S. government-backed securities.
On the other hand, bonds like Eurodollar bonds and corporate bonds present different profiles in terms of risk and trade restrictions. Understanding financial instruments such as Eurodollar bonds plays a significant role for investors looking to diversify internationally and for students studying international finance and investments.