AAA

You might have heard of the AA, but the AAA is something very different indeed (as is AA in this context).

This is actually a bond rating, and it refers to the highest of all possible ratings on bonds - in other words it shows that there is effectively no chance of there being a default, according to the ratings agency.

In simple english, you will get paid what you put into the bond and the interest at maturity. They are considered to be investment securities.

Because they are so highly rated, it often means that those issuing them can get away with a lower offer of interest than lower rated bonds as there is so little risk in holding them, relative to poorer rated bonds.

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