Bond Ratings
A bond rated BBB by S&P is considered:
BBB is the lowest investment-grade rating from S&P. Bonds rated BBB- or higher (Baa3 for Moody's) are considered investment grade. Bonds rated BB+ or lower are non-investment grade, also known as junk or high-yield bonds
Complete Analysis & Legal Rationale
BBB is the lowest investment-grade rating from S&P. Bonds rated BBB- or higher (Baa3 for Moody's) are considered investment grade. Bonds rated BB+ or lower are non-investment grade, also known as junk or high-yield bonds.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Does not match the governing securities rule described in the explanation.
Matches the verified teaching point in the explanation.
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Official Standard: Outline-level citation: item maps to Series 7 topic coverage. Prefer a specific FINRA/SEC/MSRB rule citation in a later author pass.