DEFINITION of 'Rating'

1. An evaluation of a corporate or municipal bond's relative safety from an investment standpoint. Basically, it scrutinizes the issuer's ability to repay principal and make interest payments.

2. An analyst's recommendation on whether to buy, sell or hold a specific stock.


Bonds are rated by various organizations such as S&P and Moody's. Ratings range from AAA or Aaa (the highest), to C or D, which represents a company that has already defaulted.

  1. Default Risk

    The event in which companies or individuals will be unable to ...
  2. Upgrade

    A positive change in the rating of a security. An upgrade is ...
  3. Buy

    1. A recommendation to purchase a specific security. A buy rating ...
  4. Ratings Service

    A company, such as Moody's or Standard & Poor's, that rates ...
  5. Bond Rating

    A grade given to bonds that indicates their credit quality. Private ...
  6. Hold

    An analyst's recommendation to neither buy nor sell a security. ...
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