This is a term used to describe instruments considered to be the best and safest of blue-chip stocks - ie the 'blue-chip royalty'. It usually refers to businesses with steady, long-term growth rather than short-term success.
The term was made popular by John Schwinghamer, a porfolio manager who wrote the 2012 book 'Purple chips: winning in the stock market with the very best of the blue-chip stocks'.
Schwinghamer defined purple chip stocks as those of companies with a market capitalisation of more than £1billion. He also pointed investors towards those businesses that have produced strong performances for at least seven years. He believed that these established companies were more likely to survive market turbulence than those with dramatic, short-term successes. Schwinghamer's general approach was that steady, long-term gains combined with occasional losses are preferable to sudden sharp increases in profits.
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Purple chip stocks are considered to be the most stable type of blue-chip instruments.
Purple Chip Stock is a term coined by portfolio manager John Schwinghamer in his 2012 book "Purple Chips: Winning in the Stock Market with the Very Best of the Blue Chip Stocks" to describe a stock that is “the royalty of blue chip stocks,” or the highest-quality and lowest-risk of these top-notch stocks. 1.
Purple Chip Stock is a term coined by portfolio manager John Schwinghamer in his 2012 book "Purple Chips: Winning in the Stock Market with the Very Best of the Blue Chip Stocks" to describe a stock that is “the royalty of blue chip stocks,” or the highest-quality and lowest-risk of these top-notch stocks. 1.
For instance, yellow chips might represent $2 or 20, purple often represents $500, while orange or gray chips could signify $1,000. In high-stakes games, even higher denominations like $5,000 and $100,000 chips may come into play.
These sizes include a $500 (purple/yellow) and $1,000 (orange/black). The larger sizes make it difficult to confuse such a high value chip with others in a game with such higher stakes.
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