Yankee Bonds are issued by foreign entities (bank or company). These bonds are issued and traded in the United States and denominated in U.S. dollars. Yankee bonds are governed by the Securities Act of 1933. According to the Act, bonds have to be registered with the Security and Exchange Commission (SEC) prior to being offered for sale. Yankee bonds are usually issued in tranches, individual portions of a large debt structure financing which have a different level of risk, interest rate, and maturity. The offering can be extremely high as much as $1 billion. For example, a company headquarter in Spain issues bonds in the United States which are denominated in U.S. dollars are Yankee bonds. Like other bonds, Yankee bonds obligate the borrower to pay the principal amount and interest rate according to the terms of the indenture with the help of Yankee bond a non-American company can raise capital from American investors. That is why the issuer has to register Yankee bonds with the Security and Exchange Commission before offering the Yankee bonds for sale. This process offers the investors a security of price fluctuation created by a change in currency exchange rates. The price of Yankee bonds usually fluctuates because of the variation of interest rates in the United States and financial condition of the issuer.