Junk Bond

What does it Mean? A bond rated 'BB' or lower because of its high default risk. 

Also known as a "high-yield bond" or "speculative bond".
Investopedia Says... These are usually purchased for speculative purposes. Junk bonds typically offer interest rates three to four percentage points higher than safer government issues.

Terms Related Links

Bond
Bond Rating
Credit Quality
Default Risk
High-Yield Bond
High-Yield Bond Spread
Investment Grade
Speculative Risk
Stub
Vulture Fund

Terms Related Links
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What does investment grade mean?

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