A EuroDollar is a US dollar that is held in a bank outside of the US (for example US deposits in a European or Japanese bank).
These are often received as payment for goods or services.
These deposits are subject to much less regulation than similar deposits within the US.
There is nothing European about them and there is no relationship to the Euro currency.
Refer to contracts based on these deposits traded at the CME (Chicago Mercentile Exchange)
Each Eurodollar future has a ntional of $1,000,000.
Eurodollar future contracts are used by swap dealers to hedge their interest rate exposure
The EuroDollar market is fairly liquid out to five years.
Some fixed income securities are issued in Eurodollars and pay interest in dollars deposited into foreign bank accounts.
Most (but not all) eurodollars are held in Europe ???
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