are blue chips good investments 
whether or not blue chip stocks or any other securities represent a good investment depends on an investor s financial needs investment objectives diversification goals risk tolerance and investment style nonetheless blue chips can play an important role in a portfolio they provide a useful combination of growth and value characteristics that can balance the ups and downs caused by economic distress and market volatility the companies are consistent top performers with solid fundamentals and income from dividends is usually dependable reinvesting dividends harnesses the power of compounding which is always a plus the coca cola company has paid dividends to investors for over 120 years since 1893 3blue chips as part of a larger portfoliowhile blue chip stocks are appropriate for use as core holdings within a larger portfolio they generally shouldn t be the entire portfolio a diversified portfolio usually contains some allocation to bonds and cash within a portfolio s allocation to stocks an investor should consider owning mid caps and small caps as well younger investors can generally tolerate the risk that comes from having a greater percentage of their portfolios in stocks including blue chips while older investors may choose to focus more on capital preservation through the addition of investments in bonds and cash 