Blue chips are one of the most relevant groups on the stock market and represent the companies with the highest specific weight in the stock market indices. Because when referring to this selective group we are talking about nothing less than the star values of the financial markets. Values that are characterized above all by their great corporate stability and also because they show a high level of liquidity. To the point that they are the ones that move the most titles in all trading sessions. With a volume of contracting above the rest. Serving as a point of reference for a good part of the small and medium investors.
For all these reasons, blue chips are not a very large group of values. If not, on the contrary, it comes down to the best equity companies. In this sense, and with regard to the selective index of the Spanish stock market, the Ibex 35, blue chips are represented by companies of the financial muscle of BBVA, Banco Santander, Inditex, Telefónica and Iberdrola. That is, the securities whose market value is higher and that enjoy the confidence of a large part of investors.
One of their common denominators is that they have a high volume of recruitment, above average. Every day a very high number of shares are bought and sold and there is no problem to carry out the operations. Among other reasons, because there are always buyers and sellers who will certify the movements of investors. There are no problems getting hooked on their positions, as is the case with other securities that have less liquidity. As you can see, it is very easy to spot this elite group of Spanish equities.
Blue chips: leadership within the group
Until a few years ago, this sector of the stock market was led by Telefónica. But in recent months there have been variations to the point of becoming Inditex in the company with the highest stock market valuation in Spain. Not surprisingly, the company founded by Amancio Ortega is valued at 91.380 million euros. Being one of the pillars for investment, both inside and outside our borders. In this sense, it must be remembered that this textile company has replaced the oil company Repsol as one of the blue chips. Because the blues are also being renewed and updated as happened with the members of the Ibex 35.
On the other hand, other characteristics of the so-called Spanish blue chips is their strong presence in European equities. To the point of being integrated into its most representative stock index such as the eurostoxx 50 together with the best listed companies of the old continent. They are values that arouse the attention, not only of domestic investors, but of other economic areas. It is not surprising, therefore, that they are part of the investment portfolios made by the most important management companies in the world.
Price stability
But if these special values are distinguished by something, it is because they show greater stability in the formation of their prices. Namely, its volatility does not reach extreme levels, but on the contrary there are not excessive differences between their maximum and minimum prices. At least during a good part of the trading sessions. In this way, the small and medium investor can be sure that their prices will not plummet in the less favorable scenarios for the equity markets.
Another element of analysis in the blue chips is that they do not show significant divergences with respect to their respective stock indices. That is, they replicate these with great mimicry. So if the Ibex 35 rises 1%, it means that these values will move under the same margins in the prices set by the financial markets. There are no noticeable variations but their behavior always goes along the same line. Be it in upward trends as in the downward ones, without any degree of exclusions. It is something that defines these proposals and that you can quickly detect in the stock market.
Followed by intermediaries
They are also characterized because they are securities that are followed by financial agents to integrate them into their portfolio of securities. But they also have a pursuit their performance on the stock market and a target price is assigned to guide investors to carry out their operations. With a review of their expectations based on the business results presented every quarter of the year. One of the effects of these actions is that you will always have more information compared to other stocks that do not make up this very selective club on the stock market.
In addition, another of the most relevant advantages of blue chips is that they are present in investment funds based on Spanish equities. It is not necessary to buy and sell shares on the stock market, but on the contrary you can satisfy this desire through this financial product. With greater diversification by being formed together with other financial assets. Not only from equities, but also from fixed income or even from alternative options. Something that does not happen with less liquid securities.
Pay out a high dividend
One of the contributions of the securities known as blue chips is that they distribute a very important dividend among their shareholders. With a fixed and annual yield that ranges between 4% and 6% approximately. Through a payment that can have different periodicity: annually or semi-annually and that will go to your checking account on the dates they are made effective. It is a very special strategy to create a fixed income within the variable. Regardless of its evolution in the financial markets. As a consequence, all these companies generate profits and distribute them among their shareholders.
The blue chips of the variable income are those that distribute this remuneration with greater profitability. Above other listed companies of special importance in the selective index of the Spanish stock market. To the extent that there are many investors who go to these values only for the distribution of this bonus. Because through it a savings bag intended for the medium and long term. Beyond other more aggressive investment approaches. In this sense, this strategy can be used to import more defensive investment models.
Investment deadlines
You may not know it, but these kinds of values are more effective in the longer terms of stay. Because in this way, you are in a position to collect the possible revaluations in their prices. In any case, they are not indicated for operations of a speculative nature because the fluctuations in their prices are not excessively high. As in intraday operations or what is the same, carried out in the same trading session. Not surprisingly, the period of permanence is also decisive for contracting shares of this very important group of Spanish equities.
On the other hand, you cannot forget that these values are usually very profitable to promote a certainly stable savings bag. If you do not want negative surprises in the coming years, one of the best options you have from now on are the values that are integrated into the blue chips. In addition to being very stable, they provide you with a fixed return every year. In any case, it is an excellent idea to keep them in a portfolio without too many complications. In the long term you will always get an interest on your savings.
Advantages of this choice
If you opt for any of these values, you should know some of the contributions that they will provide you in your investment strategy. Beyond performance that you finally get from their positions. Among which the following stand out:
- Provides greater stability to your positions as an average investor and away from speculative movements that carry excessive risks.
- It's about the values with greater liquidity of Spanish equities and therefore you will not have problems opening positions at any time.
- You will not have risks as a result of excessive volatility in the formation of their prices since large fluctuations in them is not one of their common denominators.
- They are values that are present in the investment portfolios of the most important international funds, even from a very prominent position.
- Represent strategic sectors within the national economy through fully consolidated business lines and with benefits in their results.
- Su contracting volume It is one of the highest in the selective index of Spanish equities, with high trading of securities in all trading sessions.
- In all cases they have a remarkable performance by dividend, with an average interest of around 5%, above the profitability of fixed income.
- They do not usually present profitability very strong, but their depreciations are not very pronounced over the years.
- They replicate the movements of their respective stock indices, in this case in the Ibex 35 which is where all these values are integrated.