Blue-Chip Stocks:  9 Reasons To Have Them in Your Portfolio

Blue-chip stocks are the ivy league of investment stocks. They are shares of companies known for steady cash flow, solid balance sheets, reliable business structure, and excellent performance history.

What are Blue-Chip Stocks?

Blue-chip stocks are shares of long-standing companies that are well established, big, financially stable, leaders in their sector, and well-known. Like blue chips in poker games, from which the name is derived, blue-chip companies are highly valued.

Why You Should Have Blue-chip Stocks in Your Portfolio

1. Safe Dividends

Blue-chip companies have strong financial foundations, which makes your dividends safe. They earn the trust of investors by consistently paying and growing dividends. This is the primary goal of any investment and a great way to build wealth long term.

Why You Should Have Blue-chip Stocks in Your Portfolio

2. High Returns on Investment

Blue-chip stocks have performed better than the general stock market, which averages 8% to 10% return. Blue-chip stocks can return up to 12% when you ideally reinvest your dividends.

Why You Should Have Blue-chip Stocks in Your Portfolio

3. Safe Harbor Stocks

Blue-chip stocks tend to be safe harbor stocks. They are less volatile than penny stocks and smaller companies’ stocks and are also likely to rebound faster after a market downturn.

Why You Should Have Blue-chip Stocks in Your Portfolio

4. Brand Recognition

Blue-chip stocks are popular, recognizable brand names. This means you can get regular updates on the companies’ progress through mainstream media. 

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