14:55
Unknown
Importance of Credit rating
Credit rating set up a link between risk and return. They provide a criterion against which to measure the risk in any instrument. A depositor uses the ratings to estimate the risk level and compares the offered rate of return with his expected rate of return (for the fix level of risk) to full optimization of his risk-return trade-off. The risk perception of a common depositor, in the lack of a credit rating system, largely depends on his familiarity with the names of the promoters or the collaborators. It is impossible for the corporate emitters of a debt instrument to offer every depositor opportunity to start a detailed risk evaluation. It is very rare for different depositor to come at few uniform...
Posted in: 
