Blue Chip Focus
Sentinel focuses much of its investment attention on the quality, larger, 'Blue Chip' spectrum of the market. Blue Chip shares can be defined as those companies which are well-established, have historical earnings, acceptable future growth potential and who have a track record of returning profits and paying dividends in good times and bad.
Although we provide advice and transact in all market listed companies, we understand that in order to truly develop sustainable long term client wealth, underlying quality investments must be selected.
Investing in Australia's largest Blue Chip companies offers investors a wide range of advantages including:
- Exposure to the highest quality companies listed on the ASX
- Most widely researched companies
- Most highly regulated companies
- Highest transparency of historical, current and future earnings guidance
- Strong liquidity allowing investors ease of entry and exit
- Continual volatility
- Large diversification of sectors
- Largest choice of investment products (physical shares, ETO's, Warrants, Margin Lending etc)
The blue chip market is the primary investment sector for local and overseas institutions, funds and private investors. This provides for continual growth and development of products, continual financial coverage and ongoing advantages for investors.
Opportunities In Blue Chip
Blue Chip companies have characteristics which offer investors maximum versatility for both long and short term investing.
Short term investors can benefit from:
- Continual Volatility
- Excellent Liquidity
- Excellent Range of Investment Products
- Ability to obtain leverage through margin lending, options, warrants etc.
- Ability to trade with a directional view that can be Long, Short and Neutral
- Ability to buy and sell time and utilise unique investment strategies with Exchange Traded Options (ETO's)
- Ability to hedge large positions and minimise downside risk whilst maximising profits
- Ability to speculate on short term share price movements and corporate events (eg. profit results)
- Ability to trade in companies which have underlying earnings and pay dividends giving a level of confidence over investment decisions.
Long Term Investors can benefit from:
- Investing in quality companies which have established, long term earnings growth
- Investing in companies which are the most researched and regulated securities on the ASX
- Generate Income through dividends and derivative strategies (eg. covered calls)
- Increase exposure through Dividend Reinvestment Plans or other corporate actions
- Hedge and protect investments through the use of derivatives
- Obtain leverage through various products (eg. Margin Lending, Warrants)
- Investing in companies which have substantial liquidity
As a whole, the ASX Blue Chip market offers investors greater flexibility than the other areas of the share market. Sentinel's role is to apply its experience and knowledge within this area to give our clients a greater level of confidence over the investment process.