Best Blue Chip Stocks list 2021?
Pick Blue Chip Stocks to buy on the basis of strong fundamentals – balance sheet, cash flow, profit growth. You need to know that they offer good value, produce reliable dividends and fit into the overall diversified risk profile.
We prefer the big blue chip stocks that are value orientated. This means that they are often not the flavour of the month. They give you income and they are not expensive. This maximises the return in the short term (dividends) and reduces market risk (of widespread selling).
Dividend income on average is giving you 4.5% a year which compares very favourably with term deposits. Most “value stocks” or those that are trading on low earnings multiples, are likely to have higher dividend payout ratios than Small Cap growth stocks. These Blue Chip value stocks give you more security in times when the overall market is under pressure. There are some value stocks that pay high dividends and some that don’t, but if your portfolio is skewed towards companies with strong balance sheets, solid cash flow and are paying consistent dividends, you should ride out the share market volatility with positive returns.
You need to access up to date research to find out which stocks to buy now, and we would encourage you to take out a free access subscription now to see which is our latest Blue Chip stock recommendations.
In 2020 during Covid, we were advising subscribers to buy the big value stocks at very cheap prices. Blue Chip stocks like CommBank, Westpac, ANZ, Tesltra, Rio Tinto, BHP and AGL Energy.
2021 Current economic outlook.
Sentiment has changed in 2021 with the Covid vaccine and the economy picking up again. Importantly the RBA Governor Philip Lowe has been resetting expectations for the outlook around interest rates. There had been big concerns about inflation and that official interest rates might need to be hiked later this year. He has now made it clear that this won’t happen in the foreseeable future. For the banks this is good news. The cost of credit (borrowing) will remain low for an extended period. This also benefits households and business. The prospect of interest rates remaining low also offsets the removal of JobKeeper at the end of this month.
What does the current economic outlook mean for buying shares? In 2021 we are now seeing opportunities in manufacturing, services and mining. If you would like to get in depth independent analysis and easy to understand buy recommendations access our free trial subscription now.