Investing in corporate bonds through OBPPs: How to read SEBI's new mutual fund-like credit risk-o-meter—experts explain
Mint 55 min ago·8 Oct 2026, 8:25 pm
SEBI has rolled out a new Credit Risk‑o‑Meter for corporate bonds, a six‑tier rating system that mirrors the risk bands used for mutual funds. The tool places each bond in a category ranging from low to very high default risk, giving investors a standardized visual cue.
For retail investors, the meter simplifies the process of assessing credit quality, helping them compare bonds and decide how much exposure to keep in a portfolio. It may also influence market dynamics, as higher‑rated issues could see stronger demand while lower‑rated ones might need to offer higher yields to attract buyers.
Going forward, watch how asset‑management firms and trading platforms embed the meter into their product screens, and whether issuers adjust coupon levels or seek better ratings. Further SEBI guidance could refine the categories or extend the framework to other debt instruments.
Excerpt from Mint
SEBI has introduced a new mutual fund-like Credit Risk-o-Meter to help investors understand the credit risk of corporate bonds and other debt instruments. The meter classifies them into six credit-risk levels, ranging from the lowest to very high risk of default. Here’s what investors should know. If you invest…Read the original at Mint
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