Wednesday, May 28, 2008

Why blue chips?

I love blue chips. They have strong cashflow have strong and consistently operating history, pay good dividends and produce products that I always use. Even during difficult economic times, they are profitable.

I love getting rebates. Hence, investing in shares of companies that sell me their products/services is a way to get rebates. When these companies pay out dividends, my rebate is back!

Below are reasons and shares of companies I am owning or had owned:

I read the papers everyday, hence I buy SPH.

I need the internet and cable for my everyday work and leisure, hence I buy starhub.

I need to use the credit cards and GIRO services for my daily expenses, hence I buy UOB and DBS.

80% of the exported products I use came via sea. Hence I buy Keppel Corp as it produces oil rigs to look for fuel for my products’ transport. They also own half of SPC.

I travel overseas at least twice a year, hence I buy SIA.

I take a cab occasionally when my car is sent for servicing. Hence I buy Comfort Delgro. I enjoying seeing or hearing people taking cab to work. This is because they are paying my dividends.

I receive numerous bills and sales advertisement weekly. Thanks to Singapore Post. I buy this company as well.

I am not staying in a cave, because there are houses being built and for sale. Hence I like capitaland and city developments.

I like blue chips because their businesses are easy to understand and they have strong corporate governance. Even Temasek owns most of them. Check this out:

Out government may not be always right but they are always correct. Follow them and we are unlikely to fail terribly.

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