Products & RisksCâu 44 / 125
Credit (default) risk on a corporate bond is best assessed by reviewing:
a.The bond's coupon frequency
b.The number of shares outstanding
c.The dividend payout ratio
d.The issuer's credit rating from a recognized rating agency
Giải thích
Credit risk is the possibility that the issuer fails to pay interest or principal. Independent credit ratings from recognized agencies summarize an issuer's ability to meet obligations, with investment-grade ratings indicating lower default risk than high-yield (speculative) ratings, which pay higher coupons to compensate.
Luyện miễn phí toàn bộ 125 câu hỏi — không cần đăng ký.
Câu hỏi liên quan cùng chủ đề
- The Options Clearing Corporation (OCC) functions as:
- Systematic risk refers to:
- Reinvestment risk is most significant for an investor who:
- A zero-coupon bond is purchased at a deep discount and:
- Which of the following bonds is generally most sensitive to a given change in interest rates?
- A mortgage-backed pass-through security, such as a GNMA (Ginnie Mae) certificate, passes through to investors:
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