Credit quality

credit quality rating investment & finance definition
An evaluation of a company's creditworthiness, and thus the creditworthiness of its debt, that is made by an independent rating service.

Credit Quality of the Fund’s Investments - It’s important to know the types of securities a fund invests in because ultra-short bond funds may experience losses due to credit downgrades or defaults of their portfolio securities.

Credit Quality
The array of credit quality choices available in the bond market ranges from the highest credit quality Treasury bonds, which are backed by the full faith and credit of the U.S.

Credit quality
Credit quality is a measure of the financial strength of a specific debt security, such as a corporate or government bond or a securitized debt obligation, and of the likelihood that its issuer will default.

Credit quality
A measure of the likelihood of default. Rating agencies assign letter designations such as AAA, AA, and so forth.

Bond Credit Quality
Interest rates on bonds will vary considerably based on the credit quality of the bond issuing entity. For example, the U.S. Treasury will issue securities with a nearly zero risk of non-payment or default.

High-grade
Credit quality of AAA or AA.
High-grade bond
A bond with Triple-A or Double-A rating in Standard & Poor's, or Moody's rating system.

High-grade
Credit quality of AAA or AA.
High yield
In the context of hedge funds, a style of management that focuses on low rated fixed income securities.

The spread of the large coupon over ordinary debt depended on the reference asset's credit quality, and was sometimes 80 - 100 b.p. (over LIBOR). This is a sort of Binary Option that is a function of the credit event.

RATINGS - Evaluations of the credit quality of notes and bonds made by rating agencies. Ratings are intended to measure the probability of the timely repayment of principal of and interest on municipal securities.

Yield curve The graphical depiction of the relationship between the yield on bonds of the same credit quality but different maturities: Related: Term structure of interest rates Yield curve option-pricing models Also called arbitrage-free ...

Bonds can become volatile if one of the bond rating agencies like Standard and Poor's or Moody's upgrades or downgrades the credit quality of the issuing company or government. A downgrade can cause the market price of the bond to fall.

Rating - the measurement of a company, country or entity's credit quality, as assigned by a credit rating agency like Standard & Poor's or Moody's Investors Service; ...

A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity dates. The most frequently reported yield curve compares the three-month, two-year, five-year and 30-year U.S. Treasury debt.

The several different tiers in credit quality of the collection of bonds helps to provide an overall stability to the backing, ...

Rating agency: Rating agencies assess the credit quality of issuers and debt instruments. The three most well known rating companies are, Standard & Poors, Moodys and Fitch. The best long term rating is AAA.

This San Francisco-based bank has always been known for its high credit quality, but that may change as the company attempts to digest last year's Wachovia acquisition.

Debentures are backed only by the credit quality or essentially the good name of the issuer. Since there is no collateral, these bonds may carry a higher risk, and therefore a higher rate of return, when compared to an asset-backed bond.

A bond whose credit quality is considered to be among the most secure by any independent bond-rating agency. A rating of Baa or higher by Moody's Investors Service or a rating of BBB or higher by Standard & Poor's is considered investment grade.

A-Rating: An "A-rating" represents the formal evaluation of a security's credit quality and ability to honor financial commitments. The rating is issued by a national rating agency.

A graph that illustrates the relationship between the yields of bonds with the same credit quality, but with varying maturities. A positive yield curve means short term interest rates are lower versus long term rates.

Fox Chase Bancorp, Inc. Reports Revised Credit Quality Measures for the Quarter and Year Ended December 31, 2011
Publish Date: Mar 09, 2012 04:30 PM ...

Debentures are backed only by the credit quality or 'good will' of the issuer. With no collateral, these bonds carry a higher risk, and therefore offer a higher rate of return, when compared to bonds backed by asset.

The difference in yields on debt security issues with the identical maturities but different credit quality. The yield spread is calculated by subtracting the yield of one instrument from another.
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Yield-Curve Strategies ...

Clean prices are more stable over time than dirty prices - when clean prices change, it is for an economic reason, for instance a change in interest rates or in the bond issuer's credit quality.

bond swaps - a municipal bond investment strategy that lets you take a tax loss and adjust your bond portfolio for credit quality and maturities to meet market considerations and your personal needs.

A swap in which a money manager exchanges one bond for another bond that is similar in terms of coupon, maturity, and credit quality, but that offers a higher yield.

Related Links: ...

Yield curve: The relationship, plotted on a graph between yield and maturity among bonds of different maturities and the same credit quality, most often Treasuries.

There are also quite a number of ratios that give insights into a bank's credit quality.

There are many concerns about regulations, solvency, nationalization, future writedowns, accurate reporting, deteriorating credit quality and many other things to consider.

Your choice in bonds range from the highest credit quality, usually a U.S. Treasury security, which is backed by the U.S. Government, to bonds that are below investment grade and considered speculative, or "junk bonds".

Yield curve A graphic depiction used to show the relationship between yield and maturity for bonds of the same credit quality.

The upside is that they can also be the most rewarding fixed-income investments because of the risk the investor must take on. The company's credit quality (financial health) is very important: the higher the quality, ...

Simplified Employee Pension (SEP): A tax-deferred retirement plan for owners of small businesses and the self-employed. Standard & Poor's Corporation: A rating agency that analyzes the credit quality of bonds and other securities.

TED Spread: The difference between Treasury bill and Eurodollar futures prices. A widening TED spread is seen as an indication of credit quality concerns in the banking sector.

For example, if an institution holds a loan that declines in market price because interest rates go up, but has no change in cash flows or credit quality, some systems do not recognize a loss.

These types of bond also react strongly to changes in the economy. For example, in the case of a recession, bond defaults go up, credit quality of issuers drop even more and total returns for these high-yield bonds go down.

the trading and sale of collateral, cash flow CDOs are managed to pay off liabilities from the interest and principal payments of collateral. This means that unlike market value CDOs, cash flow CDOs focus primarily on managing the credit quality of ...

A graphic depiction used to show the relationship between yield and maturity for bonds of the same credit quality. Yield-to-maturity ...

Substitution swap A swap in which a money manager exchanges one bond for another bond that is similar in terms of coupon, maturity, and credit quality, but offers a higher yield.

See also: Market, Investment, Securities, Bonds, Issue