Basics
Credit Rating
An agency's opinion on how likely an issuer is to repay its debt in full and on time.
Reading the rating scale
Ratings run from AAA (highest safety) down through AA, A and BBB, the lowest investment-grade band, then BB and below, which are sub-investment grade and commonly called "high yield" or "junk." Agencies also add + and − modifiers to show finer gradations within each letter band.
What a rating is, and isn't
A rating is one agency's opinion on repayment capacity at a point in time, based on the issuer's financials, business outlook and structural protections like security and seniority. It is not a recommendation to buy or hold, doesn't measure interest-rate risk, and can be revised, including downgraded, as the issuer's situation changes.