Holding all other variables constant, which of the following will DECREASE the risk of a bond to the investor?

A) Increase in restrictive covenants
B) Change in bond rating from B to BBB
C) Secured with specific assets of the firm
D) Both a & c
E) All of the above

Restrictive Covenants

Restrictive covenants are clauses in contracts that impose restrictions on actions that parties to the contract can take, often used in employment agreements and real estate transactions to protect business interests.

Bond Rating

An assessment of the credit quality of a bond, generally given by a rating agency.

Specific Assets

Assets that are designated for a particular use or are unique to a business's operation.