Corporate Bonds

As of: Fri, 22 Mar 2019 03:56 PM EDT. Tables updated hourly. Data available real-time to IB customers in Trader Workstation

Moody's Ratings Overview

Moody's Investor Service rates the long-term debt of many companies and assigns its bonds a rating, adopting a two-tier structure to discern between two types of ratings. The system creates a watershed for investors wanting to distinguish between Investment Grade and Non-Investment Grade corporate bonds. Some investors will only invest in a specific quality of bonds that are awarded a sufficiently high rating by one of several ratings agencies.Other agencies include Standard& Poors and Fitch & Co.

Investment Grade are the highest rated corporate bonds and in the opinion of the ratings agency are less likely to default on their principal and coupon repayments than companies whose bonds are rated Non-Investment Grade. Typically, Investment Grade rated corporate bonds carry lower yields than Non-Investment Grade bonds. The cost of raising capital is therefore higher to companies with weaker ratings and reflects the associated risks of investments.

The current Moody's rating scale ranks Investment Grade corporate bonds from the highest ratings to the lowest in the following order: Aaa, Aa1, Aa2, Aa3, A1, A2, A3, Baa1, Baa2, Baa3.

Non-Investment Grade corporate bonds are rated from the highest ratings to the lowest in the following order: Ba1, Ba2, Ba3, B1, B2, B3, Caa1, Caa2, Caa3, Ca and C.

A reading of WR defines a rating that has been withdrawn by Moody's indicating that it is not currently rated by the agency.


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