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Bond rating |
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Bond ratingA rating based on the possibility of default by a bond issuer. The ratings range from AAA (highly unlikely to default) to D (in default). See: Rating, investment grade.Bond ratingCorporate and government bonds are generally considered a safe form of investment compared to shares, in the sense that you are 'guaranteed' to get repayment of the principal and interest payments. But the value of the 'guarantee' depends substantially on who has issued the bond - a financially healthy issuer, or one that is struggling to meet its borrowing obligations.Credit rating agencies like Moody's and Standard & Poor's (S&P) and Fitch IBCA provide a service to the investment community by grading bonds according to how likely it is that the issuer will default either on interest or capital payments.For S&P the ratings vary from AAA (the most secure) to D which means the issuer is already in default.For Moody's the ratings go from Aaa to D.Only bonds with a rating of BBB or better are considered 'investment grade' - that is, secure enough for institutions to invest in. Anything below that grade is 'non-investment grade' or 'junk'.The ratings which S&P and Moody's give a bond are continually checked and revised in the light of new research done by those firms. When a bond is downgraded it is a serious event for the issuer because it makes it harder (or more expensive) to raise new borrowings, but it is also bad news for holders of the bonds, because the market invariably marks down the value of the bond.Similar MatchesOperating costsOperating costsAlso known as overheads, these are the costs which are additional to the direct costs of manufacturing or of providing services. Net operating loss carryforwardsNet operating loss carryforwardsApplication of losses to offset earnings in future years. Experience ratingExperience ratingA technique insurance companies use to determine the correct price of a policy premium. Operating cash flowOperating cash flowOperating Profit + Depreciation - Share of Associates' Profits + Minorities Share in Profits +/(-) Losses/(Profits) on asset disposals +/(-) decreases/(increases) in Working Capital +/(-) increases/(decreases) in provisions and other non-cash items. Appel Loan (Accelerating Payoff Progressive Equity Loan)Appel Loan (Accelerating Payoff Progressive Equity Loan)A residential property loan which calls for a payment increase over the first 6 years. Level payments are made for the remaining years and the loan paid off during the 15th year. There is no prepayment penalty and P.M.I. is required. Further SuggestionsNet operating loss carrybacksoperating profit Operating system Operating expenses Morningstar rating system Credit rating Operating risk Operating Assets Whites rating Hulbert rating Short run operating activities Operating cycle Operating in the red Best's Ratings Split rating Operating cash flow Operating lease Chief Operating Officer (COO) Operating profit margin Operating rate operating margin credit rating Credit Rating Agencies Net operating losses Stock rating |
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