Moody's Seasoned Aaa Corporate Bond Yield Market Daily Analysis: H.15 Selected Interest Rates (2024)

FAQs

What is Moody's seasoned AAA corporate bond rate? ›

US Corporate AAA Effective Yield is at 4.95%, compared to 4.92% the previous market day and 4.45% last year. This is higher than the long term average of 4.06%.

Default Rates for Global Corporate Bonds

For example, S&P Global reported that the highest one-year default rate for AAA, AA, A, and BBB-rated bonds (investment-grade bonds) were 0%, 0.38%, 0.39%, and 1.02%, respectively.

AAA-rated bonds have a high degree of creditworthiness because their issuers are easily able to meet financial commitments and have the lowest risk of default.

Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk. Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk. A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.

AAA Bonds: Considered the highest safety bonds, indicating an extremely low risk of default. AA Bonds: Also, high safety bonds, but with a slightly higher risk compared to AAA-rated bonds.

The simplest way to calculate a bond yield is to divide its coupon payment by the face value of the bond. This is called the coupon rate or coupon yield. However, if the annual coupon payment is divided by the bond's current market price, the investor can calculate the current yield of the bond.

Yield to worst is a measure of the lowest possible yield that can be received on a bond with an early retirement provision. Yield to worst is often the same as yield to call. Yield to worst must always be less than yield to maturity because it represents a return for a shortened investment period.

What is the average rate of return on corporate bonds? ›

This would be your interest-based return if you built a 100% bond portfolio overnight. In the long run, if you were to only invest in AAA corporate bonds over time, you can expect a modern yield between 4% and 5%.

Overall corporate bond yields are high and look attractive, but the extra yield investors get to compensate for the risk of lending to corporations is low.

Basic Info

Moody's Seasoned Aaa Corporate Bond Yield is at 5.28%, compared to 5.01% last month and 4.47% last year.

For Fitch Ratings, a triple-A or AAA rating is the highest investment grade and signifies that its debt is an exceptionally low credit risk. A rating of AA+ represents very high credit quality; An "A" means high credit quality, and BBB is a satisfactory credit quality.

For Standard & Poor's, AAA is the best rating, followed by AA, A, BBB, BB, B, CCC, CC, and C. D is used for bonds that are already in default, which means the underlying company isn't able to pay back principal.

Moody's Ratings rates debt securities in several bond market segments. These include government, municipal and corporate bonds; managed investments such as money market funds and fixed-income funds; financial institutions including banks and non-bank finance companies; and asset classes in structured finance.

What are AAA rated bonds? AAA rated bonds are the highest-rated investment-grade bonds. Indian credit-rating agencies like CRISIL, ICRA, CARE, and India Ratings provide these ratings after assessing the financial and operational health of the bond issuer and the risk of the individual bond.

Standard & Poor's and Fitch assign bond credit ratings of AAA, AA, A, BBB, BB, B, CCC, CC, C, D. Currently there are only two companies in the United States with an AAA credit rating: Microsoft and Johnson & Johnson.