High-grade bond

High-grade bond

A bond with Triple-A or Double-A rating in Standard & Poor's, or Moody's rating system.

Investment Grade

Describing a bond with a medium or high rating. Bonds rated Baa3 by Moody's or BBB- by S&P or Fitch. Investment-grade bonds are considered sufficiently low-risk that the law allows banks to invest in them. In addition to being low-risk, investment-grade bonds are low-return, greatly reducing the cost on the issuer. Most American Treasury and municipal bonds are investment-grade. See also: Junk, High-Rating.
References in periodicals archive ?
High-Grade Bond Spread to 2007 Levels on ThinkAdvisor.
Dan Crowley, head of distressed debt and Anthony Bugliari, head of US high-grade bond trading, are to leave the bank.
The high-grade bond market feels satiated with paper," Bank of America Corp.
This is the kind of paper that can be recycled into high-grade bond paper.
However, given that the tests focus on comparing low-grade with high-grade bond fund returns, the relevant question is whether there is reason to believe there is a bias in the difference between the two returns.
In discussing his study of low-grade and high-grade bond performance, Regan (1990) reports that the low-grade bond portfolio performed consistently well except during a recession, that junk bonds displayed the same seasonal pattern as second-tier stocks, including the "January effect;" that both low-grade stocks and low-grade bonds reflect the riskiness of the individual firm rather than changes in the general market, that the yield spread was not useful in timing business cycles, and that junk bonds behaved more like equities than like Treasury bonds.
Tucker said, 'The reopening of high-grade bond markets has definitely been encouraging.
Yields on high-grade bonds have risen half a percentage point since the start of 2018, pushing up the cost of debt financing and lowering issuance overall.
While Kazakhstan is unlikely to find itself in urgent need of the frozen money soon, the freeze may limit its ability to manage a large part of the fund's portfolio, which is mostly invested in high-grade bonds.
New issuance of US high-grade bonds could decline 17 per cent, while net supply drops 34 per cent.
Our new product was designed to meet demand from financial institutions looking for high-grade fixed-income exposure [weighted average portfolio rating of 'A-' and above], with a higher yield than those offered by high-grade bonds.

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