A credit rating category that indicates a bond is relatively safe, with low risk of default. Investment grade ratings are typically BBB and higher. Bonds with these ratings are considered suitable for conservative investors and many institutions.
A large, established utility company with a credit rating of A is investment grade. Its bonds are considered safe enough for retirement accounts and bond funds that focus on lower-risk investments. These bonds offer lower yields than junk bonds but with much less default risk.
Greater Fool is a free Chrome extension that explains terms like this in place. Highlight a word on any page, click Explain, keep reading.
Add to Chrome (free)