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Definition of 'Investment Grade'
A rating that indicates that a municipal or corporate bond has a relatively low risk of default. Bond rating firms, such as Standard & Poor's, use different designations consisting of upper- and lower-case letters 'A' and 'B' to identify a bond's credit quality rating. 'AAA' and 'AA' (high credit quality) and 'A' and 'BBB' (medium credit quality) are considered investment grade. Credit ratings for bonds below these designations ('BB', 'B', 'CCC', etc.) are considered low credit quality, and are commonly referred to as "junk bonds".
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Investopedia explains 'Investment Grade'
Investors should note that government bonds, or Treasuries, are not subject to credit quality ratings. These securities are considered to be of the very highest credit quality. In the case of municipal and corporate bond funds, fund company literature, such as the fund prospectus and independent investment research reports will report an "average credit quality" for the fund's portfolio as a whole.
Investors should be aware that an agency downgrade of a company's bonds from 'BBB' to 'BB' reclassifies its debt from investment grade to "junk" status with just a one-step drop in quality. The repercussions of such an event can be highly problematic for the issuer and can also adversely affect bond prices for investors. Safety-conscious fund investors should pay attention to a bond fund's portfolio credit quality breakdown.
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Search results for 'Investment Grade'
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http://stocks.investopedia.com/stock-analysis/2011/Investment-Grade-Bonds-Attractive-LQD-CSJ-VCSH-VCIT-VCLT1107.aspx
Due to high cash levels, investment grade corporate bonds are looking
attractive. ... Investment Grade Bonds Attractive. Posted: Nov ...
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http://www.investopedia.com/ask/answers/184.asp
... Reprints. Feedback Feedback. What does investment grade mean? Credit ... Investment
grade refers to the quality of a company's credit. In order ...
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http://www.investopedia.com/articles/02/052202.asp
... Investment Grade - These are bonds are issued by low- to medium-risk lenders. A
bond rating on investment grade debt usually ranges from AAA to'BBB. ...
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http://www.investopedia.com/exam-guide/finra-series-6/investment-companies/types-funds.asp
... There are several types of corporate bond funds, depending on the investment
grade of the bonds within the fund portfolio. For instance ...
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http://www.investopedia.com/articles/basics/04/032604.asp
... grade corporate bonds, which are considered some of the safest investments around;
at the other end are junk bonds, which have a lower investment grade and may ...
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http://www.investopedia.com/university/rrsp/rrsp5.asp
... Stocks, Debt Obligations (Bonds), Unit Trusts (Income Trusts), Rights, Warrants,
Options, Investment Grade Gold & Silver Bullion. Funds ...
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http://www.investopedia.com/articles/03/102203.asp
Is the bond you're buying investment grade, or just junk? ... Bond Rating, Grade, Risk.
Moody's, Standard & Poor's. Aaa, AAA, Investment, Lowest Risk. ...
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http://www.investopedia.com/slide-show/5--ways-to-double-investment
... over a reasonable amount of time is too invest in a solid, non-speculative portfolio
that's diversified between blue-chip stocks and investment grade bonds. ...
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http://www.investopedia.com/exam-guide/finra-series-6/investment-securities/corporate-bonds.asp
... High-Yield (Junk) Bonds: Unsecured corporate bonds that are not considered investment
grade by credit rating companies - those rated BBB or below by Standard & ...
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http://www.investopedia.com/slide-show/5--ways-to-double-investment/speculative-way.aspx
... over a reasonable amount of time is too invest in a solid, non-speculative portfolio
that's diversified between blue-chip stocks and investment grade bonds. ...
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