BOND MARKET RISK RATINGS

Investment experts widely consider bonds as a stable and safe investment and income-generating asset class.

Our risk ratings provide you with an intuitive view of the current upside and downside potential of global sovereign debt in an era of record-low interest rates and Treasury bond yields.

We assign a numeric rating to global government bond markets on a weekly basis. It provides investors with an idea of the current market risk of holding global benchmark government bonds, and is therefore one of the key considerations when making investment decisions for your portfolio.

Introduction

We developed our bond risk ratings to indicate the downside potential of global and regional sovereign debt investments on an aggregated basis in percentage points.

How do our bond market risk ratings work?

Bond market risk ratings are a vital part of investment analysis and are important indicators of the risk that a bond poses to investors. They are used by investors to make decisions about whether to buy, hold, or sell securities in the marketplace.

The lower the rating, the lower the market risk involved. Our ratings are divided into three categories, with the lowest ratings up to 40% reserved for safe investments. Understanding how bond market risk ratings work can help you make informed investment decisions.

HIGH RISK

Generally, a 60% or higher risk rating should indicate relatively high-risk and unfavorable investment conditions. A higher risk score means you should consider staying away from such markets, or if you have already invested, put your risk management skills in action to protect your investment.

MEDIUM RISK

A risk score between 40% and below 60% refers to a neutral outlook for global sovereign debt securities.

LOW RISK

A 40% or lower risk rating should signal a low-risk / investment grade market with favorable market conditions for government bond investments.

Please find more details on our risk benchmarks at our risk rating overview.

In general the score reflects to the different level of risk, and bonds with a lower rating may be more expensive but also offer greater safety for your money. For example, a bond market with a low risk rating (equal or below 40%) is considered much safer than a bond market with a rating higher than 60%, which means the former has a lower risk of default.

There are three main types of bond market risk ratings low, medium, and high. Bond markets with a lower score are typically less risky, while markets with a higher percentage level are riskier. For example, a bond with a rating of “low” has a lower risk of default than a bond with a rating of “high”.

EXAMPLE

Global bond market risk rating and performance

How are our bond market risk ratings used in investment decisions?

We assign a numerical value as a score for reflecting the level of risk that an investor is exposed to when investing in a particular bond market. The lower the percentage score, the lower the risk of default associated with that debt obligation market. It helps investors to adequately evaluate the riskiness of bond markets based on their risk-return profile and to make informed investment decisions.

Quick info

We provide the following four bond market risk ratings:

A global bond market risk score

Since 2002 the comprehensive and broad global bond risk rating (GBMR) has been tracking sovereign debt issued by the 21 most important countries (e.g., US Treasury Bonds). Historical data for the GBMR is available at https://risxx.com/market-risk-ratings-historical-data.

Three regional bond market risk scores

The GBMR consists of three regional risk ratings (e.g., US, Canada, and Western Europe).

A complete list of all published bond market risk ratings is available at https://risxx.com/list-of-markets.

Combine our risk ratings with our savvy investment strategies, and you find it easier to invest successfully.

Market risk definition from Wikipedia, the free encyclopedia.

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Risk ratings for major bond markets

The bond market is one of the major markets for investment. The global bond market’s estimated size is 100 trillion USD, making it bigger than the global stock market. Out of this figure, 40 trillion USD is the size of the US bond market. This vast liquidity makes bonds a lucrative investment and essential to have a diverse investment portfolio.

The bond market might not be as unpredictable or unstable as the stock market, but there are still times when market conditions might be unfavorable with a high-risk environment. These periods of adverse volatility make it necessary to monitor market conditions and the current risk environment continually.

We have engineered intuitive ratings that will help you to keep yourself up-to-date about the actual bond market situation and embedded risk. By subscribing to our weekly RISXX market risk report, you will get dozens of weekly risk ratings and risk strategies along with market performance reports. It provides you with a comprehensive bond market insight that should yield a higher return on investment and support you in making better investment decisions.

DISCLAIMER

GENERAL & LIABILITY

RISXX Inc. provides this website and its information for guidance and information purposes only. Therefore this website is not an offer to purchase or sell or solicit any offer to buy or sell any security or instrument. It is also not an offer to participate in any trading strategy. We compiled the information contained herein from sources deemed reliable. Consequently, it is accurate to the best of our knowledge and belief. However, RISXX Inc. cannot assure its accuracy, completeness, and validity.
Furthermore, RISXX Inc. cannot be held liable for any errors or omissions. All information contained herein should be independently verified and confirmed. Above all, we do not accept any liability for any loss or damage howsoever caused in reliance upon such information. Reader agrees to indemnify and hold harmless RISXX Inc. from and against any damages, costs, and expenses. This includes any fees potentially resulting from the application of any of the information provided by RISXX Inc.

PERFORMANCE

The analysis, ratings, and recommendations made by RISXX Inc. do not provide, imply, or otherwise constitute performance assurance. In other words, past actual or simulated performance is no guarantee of future results. The user shall not assume that future results will be positive or equal past performance, real, indicated, or implied. RISXX Inc. offers no assurance regarding the accuracy, market predictive powers, suitability, or effectiveness (either expressed or implied) of any of the information provided.

RISKS

Any market exposure always entails the possibility of substantial loss of equity. The website user agrees to assume all risks resulting from applying any of the information provided by us. Additionally, to usual risks embedded with investing, international trading may involve the risk of capital loss. For instance, fluctuations in currency values, differences in accounting principles, or economic or political instability in foreign countries could cause the risk of capital loss.

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