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| - | ====== Fitch Ratings ====== | + | ====== Fitch Ratings Scale ====== |
| - | + | {{ :es:fitch.png?nolink|}} | |
| - | {{:es:fitch.png?nolink|}} | + | |
| Fitch Ratings Inc. in an international [[en:credit-rating-agency|credit rating agency]]. | Fitch Ratings Inc. in an international [[en:credit-rating-agency|credit rating agency]]. | ||
| - | Together with Moody's and Standard & Poors, Fitch is one of the largest credit rating agencies in the world. | + | Together with [[en:moodys|Moody']]s and Standard & Poors, Fitch is one of the largest credit rating agencies in the world. |
| Fitch Rating was founded in 1913. | Fitch Rating was founded in 1913. | ||
| Credit rating agencies make risk assessments of financial instruments like: | Credit rating agencies make risk assessments of financial instruments like: | ||
| - | * | + | |
| * Government bonds | * Government bonds | ||
| * Big corporations bonds | * Big corporations bonds | ||
| * Preferred stocks | * Preferred stocks | ||
| * Mortgage backed instruments | * Mortgage backed instruments | ||
| + | |||
| + | ===== Scale ===== | ||
| + | |||
| Credit Ratings give an asessment to financial instruments. For example, an "investment grade" asset can have the following ratings: | Credit Ratings give an asessment to financial instruments. For example, an "investment grade" asset can have the following ratings: | ||
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| It is considered that an institution with a better rating (AAA) has a lower default risk than an institution with a worse rating (BBB). | It is considered that an institution with a better rating (AAA) has a lower default risk than an institution with a worse rating (BBB). | ||
| + | Fitch Rating Scale: | ||
| + | |||
| + | **Investment Grade**: | ||
| + | * **AAA**: the best grade. This grade is given to stable and reliable companies. As of 2018, in US only Microsoft and Johnson & Johnson are rated AAA | ||
| + | * **AA**: these are quality companies that have very strong capacity to meet it's financial obligations but a little more riskier that AA companies. | ||
| + | * **A**: Strong capacity to meet it's obligations. This capacity may be more vulnerable to changes in economic conditions. | ||
| + | * **BBB**: these are medium class companies. There is a low expectation of interrupted payments, but changes in circumstances are more likely to impact it's capacity. | ||
| + | |||
| + | ** Non-investment grade ** | ||
| + | The probability that the company will repay it's debt is deemed to be speculative. | ||
| + | |||
| + | * **BB**: company's payment capacity is prone to changes in the economy. | ||
| + | * **B**: the financial situation of the company varies noticeably. | ||
| + | * **CCC**: the current situation of the company is vulnerable. The company depends on favorable conditions to meet it's commitments. | ||
| + | * **CC**: very vulnerable | ||
| + | * **C**: the company or issuer can be in bankrupcy, but it's still paying it's obligations. | ||
| + | * **D**: the company has defaulted, and Fitch believes it will default most of the future obligations. | ||
| + | * **NR**; Not Rated | ||
| Fitch ratings for selected countries: | Fitch ratings for selected countries: | ||