24 Hour Loans glossary of financial terms

Blue Chip

The term blue chip is most commonly used to describe companies of a certain size and with a certain market perception. There is no specific rule on what makes a blue chip but, in general terms, this term is only applied to stable well-known companies with a large market share and a solid track record of performance in all matters. In most cases blue chips in the UK will be listed on the London Stock Exchange but this is not always the case. For some people, for example, all members of the FTSE 100 Index will be seen as blue chips but for others not all of them will be.

The actual term blue chip is believed to be based on a poker reference. In this game the blue chips represented the highest value so the term became attached to companies of a certain investment standing and profile.