how does "grades" work (D to S+)

i understand that the better you do, the higher your grade. "S+" being the highest.

and from what i have heard on the forums, (if that is to be trusted), is that its based on how good you do compared to other players playing that champ.

but that got me thinking... ALL other players? or players in your elo?

becuase its seems to be if it included ALL other players then people in "challenger" would almost ALWAYS get a higher score.. the will have better CS better mechanics... they will place more wards. granted kills and deaths matter but other than just KDA (what im assuming isn't all the grading system looks at) EVERY challenger player will practically ALWAYS get an S.

same thing would go to bronze.. a bronze player would need to display a knowledge of the champion and role at at least "silver" or "gold" if that is the "average" between all players. and while i think becuase of the new season many players are still placed WAY to low.. (like myself, really hard to carry without getting teammtes who dont feed when your playing non carry champs in non carry roles)

or does the game just compare you to people in your ELO? did i do better compared to most other silver/bronze. in which case if i did get an "S" and i regularly get an "S" i probably shouldn't be in that elo.

i have a hard time believing it encompassed ALL players playing that champion.. because (correct me if I'm wrong) but i think the average of all players is silver? probably meaning i would need to display at least gold mechanics to a champion every time i go an "S"

if that is all it takes to get an "S" woulnt player in higher elos ONLY ever get "A" and "S"???