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Blue chip stocks

Investing in well-established companies can be a good strategy for long-term performance and regular dividends.

What are blue ship stocks?

Blue chip stocks are huge, well-established companies with popular brands and products like Apple, Amazon and Coca-Cola. These companies often have a market capitalization of billions of dollars or even trillions, are financially sound and have been around for decades. Some blue chip companies distribute dividends, another reason investors flock to their stocks.

Fun fact: The term “blue chip stock” comes from poker where the blue chip was the highest value chip in a classic three-color poker chipset.

Bottom line

  • Blue chip stocks represent the largest and most well-established companies with recognizable brands.
  • Companies with a market cap of over $200 billion are typically considered blue chip stocks companies.
  • Blue chip companies often distribute dividends to investors.

Buy blue chip stocks now

What are America’s blue chip stocks?

There’s no official blue chip stocks list, but the Dow Jones Industrial Average, which lists 30 prominent companies, is a good place to start. These companies are often regarded as some of the country’s most valuable and reliable heavyweights.
However, many others listed on the New York Stock Exchange or the NASDAQ would also qualify as blue chips.

Technology companies

The FAANG stocks — Meta (formerly Facebook), Amazon, Apple, Netflix and Alphabet (Google) — is one of the most popular groups of blue chip stocks that dominated the tech sector in the past 15 years. Other tech blue chip companies include:

Banking and financial services

Companies in the financial sector make up a portion of the blue chip classification. These companies tend to have a history of providing large dividends and include the major banks and credit card companies, including:

Manufacturing

The products and brands that many Americans across generations have grown up knowing sustained growth and success, including:

Oil, gas and mining

As drilling and mining is a cyclical industry, natural resource companies have the potential to provide high capital growth. But these can have a reputation for underperforming when the mining industry experiences a downturn. That said, companies that have diversified businesses firmly established across the nation include:

Retail and restaurants

Retailers tend to offer medium-sized dividends to shareholders and are popular choices among investors. Also, popular restaurant chains have loyal followings that provide consistent profits. Blue chip stocks in this sector include:

Blue chip exchange-traded funds (ETFs)

An ETF is a fund that holds a basket of stocks. In this case, a basket of blue chip companies. The cool thing about ETFs is that they trade like stocks and you can buy them from any brokerage or a trading platform. This provides instant diversification to your portfolio without much effort.
Here are some popular blue chip ETFs:

  • SPDR Dow Jones Industrial Average ETF Trust (DIA). An ETF that tracks the 30 blue chip companies in the Dow Jones
  • SPDR S&P 500 ETF Trust (SPY). An ETF that tracks the S&P 500 index, which includes stocks from the 500 largest publicly-traded companies in the country.
  • Invesco QQQ Trust Series 1 (QQQ). An ETF that tracks the NASDAQ 100, a tech-leaning index holding stocks from 100 of the biggest NASDAQ-listed companies.
  • ProShares S&P 500 Dividend Aristocrats ETF (NOBL). An ETF of 50 companies that have increased their dividends every year for more than 25 years

Many successful long-term investors like Warren Buffett have advocated for investing in companies you believe will be around for a generation or two. The kind of stocks that tend to fit that description are the blue chips that continue to show steady returns. This may translate to consistently higher stock prices and consistent dividend payouts.
It’s a versatile combination that allows you to either reinvest those dividends and compound the earnings over time or take the dividends as a stream of passive income. On top of that, holding investments for the long term also has some significant tax advantages.
As for intangible benefits, investing in a company you can rely on for the long haul takes away much of the anxiety or worry an investor feels about a volatile stock market.

How to buy blue chip stocks

  1. Choose a stock trading platform. The right platform will depend on your needs and investing experience.
  2. Open your account. You’ll need an ID, bank details and Social Security number.
  3. Confirm your payment details. You’ll need to fund your account with a bank transfer.
  4. Find the stock you want to buy. Search the platform and buy your shares.

Our top picks for blue chip stock trading platforms

Best for beginners

Finder Award

eToro


  • Trade stocks and ETFs for $0 and no annual fee
  • Minimum deposit of $10 required
  • Get $10 when you sign up and deposit $100

Promoted for easy user experience

Robinhood


  • Commission-free trading
  • Commission-free crypto
  • No minimum account balance

Best for low fees

Finder Award

SoFi Invest


  • Trade stocks for $0 and no annual fee
  • Start trading with a $0 minimum deposit
  • Get up to $1,000 when you fund a new account within 30 days

Compare more stock trading platforms to buy blue chip stocks

1 - 6 of 6
Name Product Available asset types Stock trade fee Minimum deposit Signup bonus
Finder Award
eToro
Stocks, Options, ETFs, Cryptocurrency
$0
$10
$10
when you sign up and deposit $100
Winner of Finder’s Best Broker for Beginners award. Not available in NY, NV, MN, TN, and HI.
Robinhood
Stocks, Options, ETFs, Cryptocurrency
$0
$0
Get a free stock
when you successfully sign up and link your bank account.
Make unlimited commission-free trades, plus earn 4% interest on uninvested cash in your account with Robinhood Gold.
SoFi Invest
Stocks, Options, ETFs, Cryptocurrency
$0
$0
Get up to $1,000
when you fund a new account within 30 days.
Winner of Finder’s Best Low-Cost Broker award.
tastyworks
Stocks, Options, ETFs, Cryptocurrency
$0
$0
Get $200 in US stocks
when you open and fund an account with min. $2,000 for 3+ mos.
Highly commended for Best Derivatives Trading Platform award.
Public.com
Stocks, ETFs, Cryptocurrency, Alternatives
$0
$0
Get up to $300 in either stocks or crypto
when you use code FINDERUS to sign up and fund a new account.
Trade stocks and ETFs commission-free, plus gain access to alternative investments like art, NFTs and more.
Interactive Brokers
Stocks, Bonds, Options, Mutual funds, ETFs, Cryptocurrency, Futures, Forex
$0
$0
N/A
Winner of Finder’s Best Overall Stock Broker award.
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Compare up to 4 providers

*Signup bonus information updated weekly.

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Information on this page is for educational purposes only. Finder is not an advisor or brokerage service, and we don't recommend investors to trade specific stocks or other investments.

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