Liquid Corporate Bonds Show Mixed Performance in Last Trading Day of Week

© ООО Региональные новости

Most liquid corporate bonds showed mixed performance in the last trading day of the week:

- Polus PBO-04 bond (ISIN code - RU000A108L81) +0.9%;

- Borets Capital 001P-05 bond (ISIN code - RU000A10EK71) -0.1%;

- AFK Sistema Issue 14 bond (ISIN code - RU000A101XN7) +0.4%.

Ratings for issuers are based on a national scale. The higher the rating, the more reliable the issuer and, typically, the lower the yield on its bonds. The highest rating is "AAA", the lowest is "C", and the "D" level indicates actual default.

"AAA" bonds are the most reliable. These are large systemically important companies, often with state participation.

Bonds rated from "A-" to "AA+" are reliable securities. Pension funds and other institutional investors invest in them.

Bonds rated from "BBB-" to "BBB+" are transitional category. These may be reliable companies that are sensitive to adverse market and economic events (e.g., an increase in the key interest rate).

Bonds rated from "B-" to "BB+" are high-yield issuers (HY). Risks are high, as is the yield. These may be small and medium-sized businesses operating in risky sectors.

Bonds rated "CCC" and "D" are on the brink of default. The risks for these securities are maximum.

Overview provided by Alexey Grishchenko, Ph.D., Professor at the Department of Operational and Sectoral Management of the Faculty of "Higher School of Management" at the Financial University under the Government of the Russian Federation.