One word that intimidates most people and most importantly and this is the reason why the craft of credit rating is not only important but also a lucrative business. Learn about not just the machine, but what makes the gears move as we would discuss the business model of CRAs and learn about investing in this business through this course. https://quest.finology.in/courses/how-credit-rating-agencies-work

1. How credit rating agencies
work?

2. Brief about Credit
rating agency
A credit rating agency (CRA, also
called a ratings service) is a
company that assigns credit ratings,
which rate a debtor's ability to pay
back debt by making timely principal
and interest payments and the
likelihood of default. An agency may
rate the creditworthiness
of issuers of debt obligations, of debt
instruments, and in some cases, of the
servicers of the underlying debt, but
not of individual consumers.

3. Credit rating agencies assign a value to the credit risk of
different securities such as bonds and loans. For
example, AAA is seen as the industry standard as the
highest rating, and AAA, AA, A and BBB are widely seen
as investment-quality securities.
Ratings of BB or below are speculative grades which
denote a higher credit risk or risk of default in the
underlying security, but this often comes with a
potentially higher return on an initial investment.
Credit ratings agencies usually have analysts who
recommend a rating, and then a committee which votes
on the recommendation.