What Are Blue Chip Stock ?
Blue Chip Stocks are quality stocks
that have a proven track record. A Blue Chip stock is like a
member of the family in the American pastoral landscape. The
Blue Chip stock makes toilet paper, laundry soap, aluminum,
steel , washing machines and just about every well known brand
we used every day The Blue Chip stock is Bank of America,
U.S. Steel, Proctor & Gamble and others we think of as
being our companies.
In times of uncertainty and for long term investors the Blue
Chip stocks are a part of every portfolio either in direct
stock purchases or through mutual funds. The Blue Chip
stock is a large cap company and has decades and even a century
of presence on the stock market. Some Blue Stock stocks
are relatively new players like Home Depot or the result of a
merger & acquisition. If you look around your house and
around your town the brand products you use or have come to
rely on are Blue Chip stocks.
The fact is that we take for granted the Blue Chip stocks
both in our familiarity as an end user, but often times in the
stock market. The Blue Chip stocks make up the S&P500
index. These stocks as a whole can be purchased as an index
fund. Some Blue Chip stocks make up the Dow 100. These
stocks on the whole are a bell weather of how the overall
market is doing.
Like any familiar item the Blue Chip stocks become like a
comfortable old pair of sneakers. We know where they are
and they are easy to slip into, but they may not be as exciting
as say Google or Baidu. In recent months some of the Blue Chip
stocks have been a flight to safety for some investors. Not all
Blue Chip stocks are alike, but some have been grossly
undervalued and therefore a good buy.
Ways to invest in Blue Chip stocks:
The investor can pick and choose a Blue Chip stock and buy
it through a stock broker or on-line with a trading company
like Scotttrade or E*Trade. This gives you access to the
companies performance on the short term and charts going back
at least 10 years. The investor can access the companies
financial reports and quarterly earnings on-line. The investor
can ask the company to send you a company prospectus.
There are index funds of Blue Chip stocks that can be bought
through a financial brokerage house. There are mutual
funds that are designated as Blue Chip Funds in most family of
funds offered in all of the major mutual funds companies. There
is even a mutual fund company that offers a spider fund
comprised of Blue Chip stocks that is similar to the S& P
The variety of ways to invest in Blue Chip stocks is
endless. Spiders, Index funds, and hybrids in between. There
are option contracts and some tricky investments that only a
really savvy trader can advise you about.
The Blue Chip stocks merit a good review in all times not
just in times of market uncertainty.
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