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Investment-Grade Bonds

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Investment-grade bonds
A bond that is assigned a rating in the top four categories by commercial credit rating companies. S&P classifies investment-grade bonds as BBB or higher, and Moody's classifies investment grade bonds as BAA or higher. Related: High-yield bond.

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.


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Indeed, even from just a spread perspective, we believe that short-medium maturity investment-grade bonds look more attractive than longer maturities.
The extension was requested in response to growing interest by investors in the purchase of high quality, investment-grade bonds backed by commercial and multifamily mortgages.
Yields on junk bonds have dropped from more than 20% to under 10% during the past eight months, while investment-grade bonds pay one-third of what they did at the height of the crisis.
 
 
 
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