Posted by Ravikumar.
What is Bluechip companies and bluechip funds? | Why we should invest in it?
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Now and then we have heard or read about bluechip stocks or bluechip funds. Have you ever wondered what is blue-chip and from where this word came from?
This word came from gambling. In casinos, there are different colored chips, like red, green, and blue. Each colored chip reflects the value in currency. For buying a chip it can be called a token amount.
Meaning of bluechip
Bluechips are trust worthy, stable, reliable. They are the highest denomination in games of poker but now this jargon is widely getting used in investment and financial sectors.
Why a company is called a bluechip company?
For a company to be called bluechip it should fall into certain categories. The company should have high trust in the market, high volume in terms of cash and equity, future plans are reliable. There are 5000+ companies listed on the stock exchange in India. They are divided into 3 categories.
a. Large-cap companies
b.Medium-cap companies
c.Small-cap companies.
Among large-cap companies, the most trustworthy and valuable companies are categorized as bluechip companies. The list is stated below.
- Reliance Industries
- Hindustan Unilever Limited (HUL)
- Indian Tobacco Company (ITC) Limited
- Tata Consultancy Services (TCS)
- Oil and Natural Gas Corporation (ONGC)
- Housing Development Finance Corporation (HDFC)
- Infosys
- Eicher Motors
- Sun Pharmaceuticals Industries Limited
- State Bank of India (SBI)
What is a bluechip fund?
A fund that is created using bluechip stocks is called a bluechip fund. Below stated are the examples of bluechip funds.
- Kotak Bluechip Fund
- SBI bluechip fund
- Canara Robeco Bluechip Equity Fund.
- Axis bluechip fund
- ICICI Prudential Bluechip Fund
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All these companies have high brand value, high trust, high cash or equity flows. Most of the people of India are dependent either on their products or services. These companies are household names and are being trusted by generations.
Happy investing.
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