1. The credit risk inherent in holding non-government bonds can be minimized by

2. The lowest rating migration rates are observed for

3. During a period of high economic growth, a positive credit environment leads to

4. Other things being equal, for which credit environment is the credit spread of a AAA bond over the benchmark g-sec rate likely to be the greatest?

Understanding rating migration

rating migration: how does it affect the investor?

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An investor is affected when a bond is upgraded or downgraded by a rating agency, as the rating migration can affect bond rates and prices. Migration trends depend on the overall credit environment, and they in turn affect credit spreads in the market. Watch this video to learn more about the impact of ratings migration.

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