According to the
New York Stock Exchange, a
blue chip is
stock in a
corporation with a national reputation for quality, reliability, and the ability to operate profitably in good times and bad. The most popular index that follows U.S. blue chips is the
Dow Jones Industrial Average. The Dow Jones Industrial Average is a price-weighted average of 30 blue-chip stocks that are generally the leaders in their industry. All companies in the Dow Jones Industrial Average are blue-chips, but the Dow Jones Industrial Average is an index that does not include all companies that are blue chips. Nevertheless, it has been a widely followed indicator of the stock market since October 1, 1928. Often these stocks pay dividends.