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• Overview
• What are bonds?
• How do bonds work?
• How do you make money with bonds?
• What makes bond prices rise and fall?
• What are the major risks of bond investments?
• What are the different types of bonds?
• What is the relationship between maturity, risk and interest rates?
• How does a company’s credit rating affect the bonds it issues?
• How are the credit ratings of different issuers determined?
• What are some special features available in the bond market?
• What are convertible bonds?
• What are "junk" or "high-yield" bonds?
• What are bond indexes?
• How do you buy bonds?
• What are some drawbacks of buying individual bonds?
• How have bonds performed in the past?
• Do bonds have liquidity?
• Who is promising your return?

Bonds

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How are the credit ratings of different issuers determined?

Credit worthiness is rated by two agencies, Standard & Poor's and Moody's. They assign each issuer with a letter grade that rates the issuer's ability to pay its debts. The credit rating that an issuer receives helps to determine the interest rate it must pay in order to attract investors to its bonds.