blue chip


Definition of blue chip

1a : a stock issue of high investment quality that usually pertains to a substantial well-established company and enjoys public confidence in its worth and stability also : a company that offers such stocks
b : a business or undertaking with an outstanding record or likelihood of profitability
2 : one that is outstanding: such as
a : an outstandingly worthwhile or valuable property or asset
b : an athlete rated as excellent or as an excellent prospect

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Other Words from blue chip

blue-chip \ ˈblü-​ˈchip How to pronounce blue-chip (audio) \ adjective

Examples of blue chip in a Sentence

Recent Examples on the Web

Since crossing the threshold, the blue chips closed out their best month since October 2015 and hit a two-month high Feb. 5. Amrith Ramkumar, WSJ, "Market Indicators Turn Bullish After Flashing Red Last Year," 10 Feb. 2019 Among other blue chips, holdings in insurer Ping An, China Construction Bank and Bank of China have also dropped. Joanne Chiu, WSJ, "Stock Disconnect: Mainland Chinese Investors Buy Fewer Shares in Hong Kong," 9 Jan. 2019 The homeowner credits time spent working in New York City’s blue chip galleries as influential on his interior aesthetic. Samantha Weiss Hills, Curbed, "A micro cabin in Vermont offers an artist refuge," 15 Oct. 2018 But the gains fizzled, and the blue chip stock index closed down 45 points to 24,682. Adam Shell, USA TODAY, "How stocks, bonds and other investments reacted to Fed rate hike," 21 Mar. 2018 Some of that lucre reportedly came from a company with ties to a Russian oligarch—and some from major blue chip companies, including AT&T and Novartis. Clifton Leaf, Fortune, "Novartis Put Money In Michael Cohen’s Cookie Jar. Did It Get Any Cookies In Return?," 9 May 2018 Hodges owns about $950,000 of Citigroup shares and about $600,000 of JPMorgan stock in its blue chip equity income fund, Mr. Bradshaw said. Emily Glazer And, WSJ, "Profit Gains at JPMorgan, Citigroup Reflect a World in Growth Mode," 13 July 2018 The league features professional, semi-pro, NCAA and blue chip high school athletes., "Regional Digest: USA Softball Of Connecticut Announces Hall Of Fame Class," 9 July 2018 The latest selloff was definitely led by institutions, because in the past when the market fell, blue chips often bucked the trend. Shen Hong, WSJ, "This Year’s Selloff in Chinese Markets Isn’t Like 2015. It Looks Worse.," 6 July 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'blue chip.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of blue chip

1892, in the meaning defined at sense 1a

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Statistics for blue chip

Last Updated

11 Jun 2019

Look-up Popularity

Time Traveler for blue chip

The first known use of blue chip was in 1892

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More Definitions for blue chip

blue chip


Financial Definition of blue chip

What It Is

A blue chip is a nationally recognized, well-established and financially sound company. The term comes from blue poker chips, which have the highest value in the game.

How It Works

Blue chip companies have several characteristics:

They are usually large companies.
They are usually older companies.
They generally sell widely used products or services.
They perform relatively well during economic downturns.
They have records of long-term, stable growth.
They usually pay regular dividends, and those dividends usually grow over time.
They have reputations as management and industry leaders.
They are usually very creditworthy.

IBM, AT&T, General Electric, Coca-Cola and DuPont are examples of blue chip companies.

Why It Matters

Investors often consider the stocks of blue chip companies good long-term investments because blue chips tend to offer consistent returns. Higher stock prices and lower yields generally balance this perceived lower risk, however.

The two most popular lists of blue chip stocks are the Dow Jones Industrial Average and the Nifty Fifty. The Dow Jones Industrial Average is a list of thirty industry-leading companies chosen by the editors of the Wall Street Journal. The Nifty Fifty are the fifty blue chip stocks that became popular before the bear market of 1973-1974.

Investors can purchase shares of blue chip companies directly or they can invest in derivative blue chip instruments that provide exposure to a variety of blue chip stocks. One example is a type of derivative blue chip instruments called Diamonds, which are exchange-traded securities that represent fractional shares of the underlying components of the Dow Jones Industrial Average.

Source: Investing Answers

blue chip


Legal Definition of blue chip

: a stock issue of high investment quality that usually pertains to a substantial well-established company and enjoys public confidence in its worth and stability

Other Words from blue chip

blue-chip adjective

Comments on blue chip

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showing courage and determination

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