Blue Chip

Key takeaways

These refer to companies that are financially strong, with above-the-board management and selling popular products or services of a high standard, with a broad reach. Their stability makes their stock in the market well-regarded and promises a steady performance. Many of them are part of the benchmark indices. 

1. Blue Chip companies are well-known companies that provide universally renowned goods or services, which reflects in their sales performance.
2. Blue chip stocks are offered by large-cap companies, which offer higher security and stability compared to other company’s shares.

Blue chip meaning / Blue chip investment

Blue chip companies are well-known, well-established, and financially secure companies, and these companies come in the top 100 biggest listed stock exchange category. Generally, these types of companies provide universally renowned and quality goods and services. Since blue chip stocks belong to the large-cap companies and investment in large-cap companies, they provide steady income and security, which makes bluechip investment safer options. 

Blue chip fund / what is blue chip fund

These funds are well-known companies that provide universally renowned goods or services, which reflects in their sales performance, productivity, profitability, and dividends. Blue chip is the most decent option for investors who are looking for safer investment options. Since these stocks belong to well-known well-established companies, they inherit low risk and are more stable than the smaller company’s funds. Leading companies like Bharti Airtel, Infosys, ITC, Reliance Communications, TCS have bluechip stocks. Investors, through bluechip funds, gain from the growth of bluechip stocks. Blue chip funds provide more security than other funds. Since blue chip funds are open-ended funds, investors can liquidate funds quickly. These funds maintain stability. Those investors who are looking for a secure investment, moderate returns, blue chip funds are the best option for them.

Characteristics of blue chip stock

• Blue-chip stocks are seen as less volatile investments and they are highly liquid since they are frequently traded in the market by individual and institutional investors.
• Blue-chip companies have little to no debt, large market capitalization, stable debt-to-equity ratio, and high return on equity (ROE) and return on assets (ROA).
• A blue-chip index, which can be used as a measure of the health of an industry or an economy, allows investors to follow the performance of blue-chip equities.

Know more

Blue chip companies are mostly well-known large-cap companies in India.