Fixed Income
Rating Agency
Definition
What is Rating Agency?
An organisation that assesses creditworthiness and assigns credit ratings.
Example in practice
How This Looks in Practice
The rating agency reviews the issuer's leverageThe use of borrowed money or derivatives to increase exposure relative to invested capital. and cash flow.
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Related Terms
Fixed Income
Bond
A debt security through which an investor lends money to an issuer in return for promised payments.
Fixed IncomeIssuer
The government, company, or organisation that creates and sells a security.
Fixed IncomeFace Value
The principal amount stated on a bond and usually repaid at maturity.
Money MarketsTreasury Bill
A short-term government debt instrument usually issued at a discount and repaid at face value.