Answer 比花花还花\'s Q abt investment-grade bonds

Investment-grade bonds are rated BBB- or higher by S&P, or similar ratings by Fitch and Moody's. The highest rating is AAA, like US Treasurys (don't ask me how =). Investment-grade corporate bonds are rated right below the first-class govt bonds. They are rated based on the risk of default and ability to keep interest payments and so on. We know the rating part is a rigged game just like stock ratings by analysts. But big conservative institutiions (like banks, pension funds and Sovereign Wealth Funds) can only invest in a certain range of bond ratings. For example, China govt only buys US Treasurys and MBS. In constrast, high-yield bonds are not rated, so they are much riskier and catered to some investors (hence the name "junk bonds", just like some investors like penny stocks). When the economy is in full expansion after early recovery, big investors like to go after investment-grade bonds as long-term fix-income sources. The similar rationale can be said for blue-chip stocks, too.