They are stocks issued by companies that have a long track record of earning profits and paying dividends.
Blue-chip stocks are issued by large, well-established firms that have impeccable financial credentials.
These companies are often the leaders in their industries.
Not all blue chips are alike.
Some provide consistently high dividend yields; others are more growth oriented.
While blue-chip stocks are not immune from bear markets, they are less risky than most stocks.
They tend to appeal to investors who are looking for quality, dividend-paying investments with some growth potential.
Blue chips appeal to investors who want to earn higher returns than bonds typically offer without taking a great deal of risk.
Good examples of blue chip growth stocks are:
- Procter & Gamble,
- Home Depot,
- Lowe's Companies, and
- United Parcel Service.
Examples of high-yielding blue chips include such companies as:
- Johnson & Johnson,
- McDonald's, and