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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: Petrol who wrote (35198)	9/18/2000 1:16:11 AM
From: Rande Is	Read Replies (2) \| Respond to of 57584

Welcome to the HOME thread. . and to SI, Stickupman. The question you raise as to which stocks are Blue Chips would be easy for a financial advisor to answer. But a quick answer barely scratches the surface of your question. Looking deeper, a Blue Chip promises "consistent performance over time." . . .supposedly the perfect combination of growth and income. Famous recent Blue Chips have included IBM, WCOM, T, LU, AOL, DELL, MSFT, BMY, etc. However, if they have stopped performing consistently, have they also stopped being Blue Chips? More and more lately, there is a point at which even the best Blue Chips have outlived their blueness. Investing in that above group just one year ago, would have led to very disappointing results. finance.yahoo.com And if you get disappointing results over time, then are you truly invested in a Blue Chip? It used to be that Blue Chips were "immuned" from getting too big a haircut on bad news. They were "safe" investments. . .for widows and your own mother. The street believed that they would "always pull through". But the volatility in this new market is changing the characteristics of the market. It no longer behaves as it once did. And Blue Chips are no longer safe from the razor blade of critical valuation. Lucent was chopped in half this year. Last winter WCOM was considered the best stock to invest in for the year 2000 by many magazines and brokerage houses. It was a major disappointment. Right now Corning, Intel, Cisco, AMD and others are hot and on the way to being crowned the next blue chips. But we have already allowed their valuations to get out-of-hand leaving little growth that is not yet figured into the current price. In this new economy market where we have become accustomed to high valuations, all it takes is a single bad earnings report and the cream of the crop will be chopped down like the rest of them. Which brings up the question, "could the "concept" of Blue Chips be dead?" I'll leave that subject open to discussion. . . Rande Is