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A bond is considered investment grade or IG if its credit rating is BBB− or higher by Fitch Ratings or S&P, or Baa3 or higher by Moody's, the so-called "Big Three" credit rating agencies. Generally they are bonds that are judged by the rating agency as likely enough to meet payment obligations that banks are allowed to invest in them.
For Fitch, a bond is considered investment grade if its credit rating is BBB− or higher. Bonds rated BB+ and below are considered to be speculative grade, sometimes also referred to as "junk" bonds. [103] Fitch Ratings typically does not assign outlooks to sovereign ratings below B− (CCC and lower) or modifiers.
Looking at rated bonds for 1973–89, the authors found a AAA-rated bond paid 43 "basis points" (or 43/100 of a percentage point) over a US Treasury bond (so that it would yield 3.43% if the Treasury yielded 3.00%). A CCC-rated "junk" (or speculative) bond, on the other hand, paid over 7% (724 basis points) more than a Treasury bond on average ...
Investment-grade bonds with a lower risk of default are rated BBB up to AAA on the Standard & Poor’s credit rating scale and other models. Junk bonds, or high-yield bonds, are rated below BBB ...
The Fitch rating scale is divided into two main categories: investment grade and non-investment grade (often referred to as speculative grade). These ratings help investors build risk profiles for ...
This is a list of U.S. states by credit rating, showing credit ratings for sovereign bonds as reported by the three major credit rating agencies: Standard & Poor's, Fitch and Moody's. The list is given as of May 2021.
In August 2011, S&P downgraded the long-held triple-A rating of US securities. [1] On August 1, 2023, Fitch downgraded its credit-rating of United States Treasuries from AAA to AA+, as S&P had twelve years earlier, leaving only Moody's to still assign its highest rating to the country's debt.
Moody's credit ratings Investment grade Rating Long-term ratings Short-term ratings Aaa: Rated as the highest quality and lowest credit risk. Prime-1 Best ability to repay short-term debt Aa1: Rated as high quality and very low credit risk. Aa2 Aa3 A1: Rated as upper-medium grade and low credit risk. A2: Prime-1/Prime-2