Credit Score
Bondview’s Credit Score is our curated opinion of the investment risk based upon BondView's market implied rating, liquidity rating and factors such as institutional bond ownership.
 credit score |
Investment Grade Level | Rating Descirption | Fitch ratings | Standard & Poor's | Moody's | ||||
|---|---|---|---|---|---|---|---|---|---|
| Long-Term | Short-Term | Long-Term | Short-Term | Long-Term | Short-Term | ||||
| 10 | Investment Grade | Prime | AAA | F1+ | AAA | A-1+ | Aaa | P-1 | |
| 9 | Investment Grade | High Grade | AA+ | AA+ | Aa1 | ||||
| AA | AA | Aa2 | |||||||
| AA- | AA- | Aa3 | |||||||
| 8 | Investment Grade | Upper Medium Grade | A+ | F1 | A+ | A-1 | A1 | ||
| A | A | A2 | |||||||
| A- | F2 | A- | A-2 | A3 | P-2 | ||||
| 7 | Investment Grade | Lower Medium Grade | BBB+ | BBB+ | Baa1 | ||||
| BBB | F3 | BBB | Baa2 | P-3 | |||||
| BBB- | BBB- | A-3 | Baa3 | ||||||
| 6 | Investment Grade | Non-investment Grade Speculative | BB+ | B | BB+ | B | Ba1 | Not Prime | |
| BB | BB | Ba2 | |||||||
| BB- | BB- | Ba3 | |||||||
| 5 | Non-investment Grade | Highly Speculative | B+ | B+ | B1 | ||||
| B | B | B2 | |||||||
| B- | B- | B3 | |||||||
| 4 | Speculative | Substantial Risks | CCC+ | C | CCC+ | C | Caa1 | ||
| CCC | CCC | Caa2 | |||||||
| CCC- | CCC- | Caa3 | |||||||
| 3 | Speculative | Extremely Speculative | CC | CC | Ca | ||||
| 2 | Highly Speculative | Default Imminent | C | C | |||||
| 1 | Highly Speculative | In Default | RD | D | RD | D | C | ||
| D | SD | / | |||||||
| / | / | / | |||||||
| 0 | NA | ||||||||
Fitch Rating Definitions
The Primary Credit Rating Scales (those featuring the symbols 'AAA'–'D' ) are used for debt
and financial strength ratings.
Read more
Standard & Poor’s Ratings Definitions
Curious as to what a ʻAAAʼ or ʻBBʼ rating on a bond actually means? View detailed descriptions
of what constitutes each of S&P's ratings here.
Read more
Moody’s Ratings Definitions
Municipal ratings incorporate Moodyʼs assessment of the default probability and loss severity of
these issuers and issues.
Read more
Bond Ratings
A bond rating performs the isolated function of credit risk evaluation. A bond rating does not
constitute a recommendation to invest in a bond and does not take into consideration the risk
preference of the investor. While many factors go into the investment decision making process,
the bond rating is often the single most important factor affecting the interest cost on bonds.
There are three major rating agencies for municipal bonds: Moody's Investors Service, Standard & Poor's, and Fitch Ratings.
Market Implied Ratings
Bondview computes based on the bond's return, or yield, relative to the yield of a treasury bond
of equivalent maturity. A treasury bond, which is backed by the U.S. government, is viewed as
having no risk. So the larger the spread (difference) between a bond's yield and its equivalent
treasury yield, the more default risk the market perceives for that bond. Another way of saying
this is that the market is requiring a higher yield to compensate for the higher default risk.
Bonds rated from five stars (best) to none. Bonds with lower spreads (less risk) are given more
stars than bonds with higher spreads (more risk). Ratings are calculated frequently to ensure
they reflect the most current market factors.
Liquidity Ratings
Bondview computes daily as a ratio based on the number of trades in a given bond compared to the
average number of trades of all the bonds in a similar class. The higher the ratio, the more
frequently the bond is traded relative to similar bonds. The range covers the last 45 days.
Liquidity is considered a reliable investment factor because it helps indicate if a bond
purchased today is likely to have a liquid market available to be sold into at some future date.
For example, if an investor's financial situation changes and needs to convert bonds to cash,
or if an investor rebalances a portfolio and there is a need to replace an asset with another one
that better meets the objectives.