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> I don't understand why S&Ps rating matters Because it's part of many private contracts and financial products. (E.g. 'in case the S&P rating of entity X drop
by sz4kerto 12y ago
> I don't understand why S&Ps rating matters
Because it's part of many private contracts and financial products. (E.g. 'in case the S&P rating of entity X drops below Z, then [...]').
- pessimizer 12y agoThanks. Is this generally something that's written in to qualify for doing business with the state, or something that private investors look for?
- arjunnarayan 12y agoBoth. A lot of large institutional investors (like pension funds) have statutory limits on the percentage of the portfolio that can be allocated to riskier investments. Risk is sometimes defined by the S&P rating.