Finance: What are Bond Ratings, and What Do They Mean?

Dive into this vital exploration of bond ratings, featuring a comparative analysis of risk factors in bonds stemming from various sectors and how bond ratings play a pivotal role in investment decisions. Delve into real-world examples of fluctuating bond performances with a particular lens on the Puerto Rico's bankruptcy and its consequential impact on their bonds.


- This video is an exploration of the concept of bond ratings, a critical factor in making investment decisions.

- It presents a comprehensible breakdown of what a bond is - a promise to pay back the lent money along with its interest in a predefined period.

- You will learn how some bonds carry more risks than others, backed by a real-world example of Puerto Rico's bankruptcy in 2017.

- During the economics shift due to the advent of internet and wireless technology, the crash of several radio and newspaper industries' bonds are also elaborated upon.

- Despite the majority of bonds fully paying back their scheduled interests and principal, there are circumstances when certain bonds fail to do so.

- Discusses the role of rating services in assessing borrowers' ability and their likelihood to adhere to their payback commitment.

- Finally, it presents a bond rating chart, illustrating that AAA bonds are considered to be the superior ones while bonds in the 'C' range are deemed to have underperformed.


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