what is a blue chip 
a blue chip is a nationally or internationally recognized well established and financially sound company that s publicly traded blue chips generally sell high quality widely accepted products and services blue chip companies have reputable brands that have been built and maintained over many years that and the fact that they ve weathered multiple downturns in the economy make them stable companies to maintain in a portfolio blue chip companies operate profitably despite adverse economic conditions this helps to contribute to their long records of stable and reliable growth understanding blue chipsthe term blue chip was first used in 1923 by oliver gingold an employee of dow jones to describe stocks that traded at 200 or more per share 1 it relates to blue white and red poker chips with the blue chips having the greatest value blue chip stocks aren t necessarily stocks with a high price tag they re shares of high quality companies in healthy financial condition that have withstood the tests of time a blue chip stock is generally a component of the most reputable market indexes or averages such as the dow jones industrial average the standard poor s s p 500 and the nasdaq 100 in the united states the tsx 60 in canada and the ftse index in the united kingdom they re usually listed on major stock exchanges such as the nyse and the nasdaq 