This article is to introduce the type of stocks that is available in the market.
Blue chips
These are companies with strong fundamentals. They have track record of high earnings and good dividends for years. Some even give good dividends (5-8%).
Second liners
These are companies that have performance in between blue chips and third liners.
Third liners
They are companies with poor fundamentals.
Growth stocks
These are companies that give high growth due to their high growth potential. They usually retain their earnings to further expand their businesses and therefore usually give low dividends.
Cyclical stocks
These type of stocks depend much on the economic cycles. They are companies whose earnings track the business cycle.
Income stocks
These type of stocks pay very high and generous dividends, for example, tobacco companies.
Defensive stocks
These stocks are least affected by the economic crisis or in the bearish market. Good exampls include those in the food and consumer businesses.
Blue chips
These are companies with strong fundamentals. They have track record of high earnings and good dividends for years. Some even give good dividends (5-8%).
Second liners
These are companies that have performance in between blue chips and third liners.
Third liners
They are companies with poor fundamentals.
Growth stocks
These are companies that give high growth due to their high growth potential. They usually retain their earnings to further expand their businesses and therefore usually give low dividends.
Cyclical stocks
These type of stocks depend much on the economic cycles. They are companies whose earnings track the business cycle.
Income stocks
These type of stocks pay very high and generous dividends, for example, tobacco companies.
Defensive stocks
These stocks are least affected by the economic crisis or in the bearish market. Good exampls include those in the food and consumer businesses.
I would prefer to invest in Blue Chips, because they are more established. However, make sure you buy it at a bargain price.
I don't like to invest in third liners companies.
to janice,
Make sure the Blue Chips company is stable too. Don't buy blue chips company that are in the 'deteriotation state'
to jason,
You should follow janice advise to invest in blue chips company. Buy it at a bargain price.