What is the purpose of credit rating in debt investment?

Credit rating agencies evaluate the creditworthiness of debt securities. It allows investors to figure out how much default risk is connected with a fund. Also, it is usually a good idea to look at the funds' previous credit ratings. AAA is the highest credit score, while D is the lowest, according to CRISIL. This agency, like many others (CARE, ICRA, Brickwork Ratings India Pvt. Ltd.), publishes credit scores after several evaluations on a regular basis. Investors may pick which debt instrument to purchase based on the highest and safest ranking. This sort of tool assists investors in deciding which debt instruments to include in their portfolios.