The main risk of a bond and the rating of bonds
How to measure reliability and better target investments.
Deciding to invest in bonds is a decision that must be taken very carefully. Laura and Marco, the couple of protagonists of this video, have learned that security and profitability are normally opposing concepts and that the most secure bonds usually offer a lower yield. As explained in our Glossary with over 1200 exercises: Redooc, the reliability of the bonds is measured through the rating assigned by special agencies. According to the rating, therefore, and to their condition and belief, Laura and Marco are able to assess where to direct investments, avoiding to choosing a direction that can expose to greater risks.
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