A rating is a rating tool assigned by an analyst or rating agency to a stock or bond.
The three major bond rating agencies are Standard & Poor’s, Moody’s Investors Service and Fitch Ratings.
Bond ratings assess the creditworthiness of an issuer or insurer, which can be interpreted as a direct measure of the probability of default.
For stocks, analysts on the buy side and on the sell side will do research and then write an opinion on the stock they cover, which will include a rating such as buy, hold, or sell.