Blue Chip Stocks
Blue Chip Stocks are stocks that have been in business for many years. Generally, blue chip stocks have market capitalization in the billions and usually a component of major indexes or averages such as the Dow Jones Industrial Average, the S&P 500, or the Nasdaq-100. Often, blue chip stocks are the market leaders in their industry. Think of Google, Apple and Microsoft in the technology industry and McDonald's Corp in the restaurant business, JPMorgan Chase in the financial industry and so on.
Blue Chip Stocks are safer to invest than regular stocks because they may have survived through multiple market crashes. However, even the best companies can go bankrupt like the General Motors and Lehman Brothers crashed in the 2008 recession.
Many blue chip stocks pay dividend such as Warmart, Coca Cola, 3M Co, and Microsoft. Check out the high dividend stocks to see a list of companies that pay good dividend. While dividend might be a factor for you to decide which stocks to invest, it is not a requirement for a company to be considered as a blue chip stock. Google doesn't pay dividend yet it is the 2nd largest company in the technology industry and the 3rd largest company in the world by market capitalization.
One way to invest in stocks is to buy blue chip stocks where the company has a long history of paying dividends, the longer the better. Conservative investors can consider buying only stocks that paying dividends for 20 years or more.
To keep track of the blue chip stocks, check out the 30 Dow Jones Stocks.
Check out the large cap stocks to get a list of companies with market capitalization of $10 billion and over. The following is a list of blue chip stocks with market capitalization of at least $50 billion.