INVESTMENT GRADE
A rating ascribed to bonds with relatively low risk of default. Rating agencies such as Standard & Poor’s use several designations that comprises of uppercase and lowercase letters ‘A’ and ‘B’ to denote a credit quality rating of a bond. Rates ‘AAA’ and ‘AA’ (high credit quality), as well as ‘A’ and ‘BBB’ (medium credit quality) are investment grades. Credit rating for bonds below these ratings such as ‘BB’, ‘B’, and ‘CCC’ are low credit quality and commonly called "junk bonds".
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Asset Substitution Problem
A problem which arises when a company trades its low-risk assets for high-risk investments. This substitution moves the value from the bondholders ...
Lawful Money
Any currency, in coin or paper form, that is issued by the United States Treasury, not the Federal Reserve System. It also includes gold and silver ...
Red Clause Letter Of Credit
It refers to a specific type of letter of credit where a buyer extends an unsecured loan to a seller. This permits documentary credit beneficiaries ...
Trust Certificate
Bond or debt investment backed by other assets and serve like a collateral. Normally in a public company, the assets may be seized or sold for the ...
Cowboy Marketing
Slang term for a situation in which a firm is unaware a marketer sends massive spam emails to everyone promote the stock, instead of producing legi ...
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Health Savings Account: Eligibility
We discussed the fundamental information regarding HSAs. Now, we shall tackle the qualifications for opening an HSA.
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Buying a Home: Finding the Best House
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