Menu
Home
Log in / Register
 
Home arrow Business & Finance arrow The handy investing answer book
< Prev   CONTENTS   Next >

What is a "blue chip stock"?

A blue chip stock is a publicly traded company that is usually very large, may be distributing profits in the form of dividends for many years, is a leader in the sector in which it competes, has notable stability and growth, and has the ability to adapt to changing market conditions successfully.

Where did the term "blue chip stock" originate?

It is thought by many to be derived from gambling, specifically the card game "poker," where in betting, the use of the blue-colored chips represents the most expensive chip at the table.

When did The Wall Street Journal begin to publish a Dow Jones Industrial Average?

The Wall Street Journal began publishing an average of the prices of stocks listed on the New York Stock Exchange in 1896.

What is the Dow Jones Industrial Average (the"Dow"or"DJIA")?

The DJIA is a price-weighted average of thirty blue chip stocks traded on the New York Stock Exchange. It is often seen as a barometer of the health of the stock markets.

How important is the DJIA to the investment community?

The DJIA is widely regarded as the most important index to follow in the world. It broadly indicates stock prices and investor confidence.

Who picks which stocks are components of the Dow?

The editors of The Wall Street Journal decide which companies should be included in the Dow. They search for a balance of companies reflective of the U.S. economy as a whole.

Who created the DJIA?

Charles Dow created the Dow, picking 11 stocks, then increasing this number to 12 stocks before publishing the average in 1896 that made up the Dow.

How else do I use the Dow in order to analyze my portfolio?

You may use the Dow in order to compare the performance of your stocks, bonds, and mutual funds, and ask yourself whether you are outperforming or underperforming the Dow. It helps to see this comparison over different periods of time in order to assess the success of your investment choices.

 
Found a mistake? Please highlight the word and press Shift + Enter  
< Prev   CONTENTS   Next >

Related Topics

How is the Dow important to our understanding of the activity and performance of blue chip stocks?
What are "stocks"?
What is a "stock split"?
How is the Dow important to our understanding of the activity and performance of blue chip stocks?
INDIVIDUAL STOCKS
What is a "stock split"?
What are six ways experts at The Wall Street Journal feel will help children begin to understand how to invest?
Why are real estate analysts cited by The Wall Street Journal worried for small college town rental property owners?
May a library make multiple copies of clinical guidelines that are published in an association publication or a professional journal and put the copies on reserve?
How does the movement of prices in stocks that compose the Dow Jones Industrial Average indicate movement in the price of my stock?
Industrial Ecology's First Decade
Diffusion of Industrial Symbiosis
How does the Internet contribute to the prevalence of fraud within the investment community?
The Investment Vehicle and the Community Partner Relationship
How does the performance of collectible art compare to other investments over time?
INDIVIDUAL STOCKS
What is a "stock split"?
Monitoring Component
What are some key steps to take in creating my business, after I consider the information above?
How This Book was Created Using Collaborative Authoring and Cloud Tools
Q82. What is a bank and how does it create money?
Why should I consider using a moderate portfolio allocation for my retirement investments?
How often should I check or analyze my portfolio to make sure it is properly allocated?
How will the use of software help individual investors to analyze their portfolios?
 
Subjects
Accounting
Business & Finance
Communication
Computer Science
Economics
Education
Engineering
Environment
Geography
Health
History
Language & Literature
Law
Management
Marketing
Philosophy
Political science
Psychology
Religion
Sociology
Travel