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Rating Grades and Rating Status

AAA, BBB, Baa1, Ba1, investment-grade, speculative-grade, not-rated, downgrade, fallen angel, and weighted-average rating terms.

Rating grades and rating status terms describe where a bond or issuer sits on a credit rating scale and whether its status has changed.

Use this branch when a bond’s eligibility, price, spread, index membership, mandate fit, or liquidity depends on investment-grade status, speculative-grade status, downgrade risk, not-rated status, or weighted-average portfolio rating.

What This Branch Covers

AreaUse it for
Rating Grades and Investment-Grade StatusAAA, BBB, Baa1, Ba1, investment-grade, and speculative-grade rating labels.
Rating Actions and Unrated StatusDowngrades, fallen angels, rated status, not-rated securities, and weighted-average credit ratings.

Why It Matters

Crossing a rating threshold can change the investor base, borrowing cost, index treatment, regulatory treatment, and portfolio mandate eligibility. The market may react before or after a formal rating action if investors expect the change.

Common Mistakes

  • Treating all investment-grade bonds as equal risk.
  • Assuming not-rated means low quality; some issuers or issues are unrated for other reasons.
  • Ignoring differences between agency scales, issue ratings, issuer ratings, and portfolio-average ratings.
  • Treating a downgrade as the first moment credit risk changed.

In this section

Choose a subsection first. Deeper term pages live inside each subsection, which keeps large topic hubs readable.

Rating Actions

Fixed-income terms for downgrades, fallen angels, unrated securities, rated status, and weighted-average credit ratings.

Rating Grades

Fixed-income terms for AAA, BBB, Ba1, Baa1, investment-grade, and speculative-grade credit ratings.

Revised on Sunday, June 21, 2026