Investing term

What is Investment-grade (IG)?

Corporate bonds rated BBB- or better — issuers strong enough that default is rare but not impossible.

Investment-grade bonds are those rated BBB- or higher by the major agencies — issued by governments and companies financially strong enough that default is uncommon, though never impossible. They pay lower yields than junk bonds precisely because they're safer. They're the backbone of the bond sleeve in most conservative portfolios.

For example

A blue-chip company rated A issues bonds yielding 4.5% — modest, but the investment-grade rating signals a low chance it ever misses a payment.

Investment-grade (IG) is taught hands-on in Stage 19 — Beyond Stocks.

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Related terms

ASMLDutch semiconductor-equipment company that makes the EUV lithography machines every advanced chip is manufactured on — a global monopoly with no US peer.Bond ladderA portfolio of bonds with staggered maturities — one matures every year (or every few years) so cash continuously becomes available.CryptocurrencyDigital assets recorded on a blockchain — Bitcoin, Ethereum, etc. Highly volatile and not backed by cash flows or governments.Currency hedgingAn overlay used by some international ETFs to remove the effect of currency moves, so you get the foreign stock return in your home currency.
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