You will always hear about blue chip stock in the stock market. That is, you will hardly know. Actually, blue chip stocks are stock of large companies, whose presence also affects the country’s economy. The products and services of these companies are considered the best in the market. Whose credibility is quite strong in the stock market and other open markets. Companies whose management is much better than other companies. By the way, the word “blue chip” originates from the poker game, where the value of blue chips is the highest. Shares of blue chip companies are considered to be of much better quality. Let us also tell you what are the 10 benefits of investing in blue chip shares.
Generally, such stock faces economic recession and remain stable compared to other stocks of the industry and the economy.
Due to which such shares are considered more secure and reliable investment options than shares of companies of moderate and small size.
Major and major companies of the country are listed in major stock market indices like Sensex and Nifty. You will get the names of such companies in Sensex 30 and Nifty 100. These companies include Reliance Industries, TCS, HDFC Bank and HUL. These stocks are currently the backbone of major index and mutual fund portfolio.
A distinctive feature of blue-chip shares is his position as a leader in their respective fields. These companies are known to provide the best products or service in their industry and their market share is also higher than other companies. Due to which these companies remain a strong brand identity among the customers.
Bluechip stock companies have more bargaining power than other companies. The reason for this is the monopoly of the company in the respective field. This is why it is firmly introduced with companies. Due to which the revenue of such companies increases.
Such companies usually have strong financial strength with low debt, low working capital, healthy balance sheet and adequate cash reserves. This financial stability helps them in research and development, capital expenditure, strong marketing.