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Blue chip investments?


what are the average annual returns of blue chip companies in percentages. ex +8%

and whats the point of investing if the return is less then 10%.

why not leave it in a bank without risk at the same percentage interest

Some stocks will do better than others in any given year. But the average return of an index fund tracking blue chips will easily outperform a bank deposit over time. Plus if you hold it for over a year, it is a long term capital gain, and will be taxed at a lower rate when you sell. Dividends paid are taxed at a lower rate if you own the stock over 60 days. Long term, the stock market is the place to be.

10% interest in a bank-- I haven't seen that type of interest rate in years. If you are looking at the short term, take it. Long term, with the tax advantages of stocks, I think you would still do better with high quality stocks.

The average return for the stock market over a long period should be 8%. This does not mean you will get 8% each year. Some years it will be up 12%, then up 16%, then down 10%. But over the long term, you should do 8%.

This is better than a bank for several reasons. First the return is usually higher. Most banks and money markets historically pay only 3% (though CD rates are higher right now about 5%).
Second, the tax rates for stock is better. Capital gains are taxed at 15 or 20%, which is normally less than the tax rates most people pay for interest. Also, you only have to pay the capital gain when you sell, not every year as with interest.

not sure but have a look at http://www.stocktraderbuzz.com/ for companies that are doing well on the stock exchange.

the bluechip companies would give a return of around 15 % on the average.

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