Fortune 500 companies are companies who have publicly traded stock, and they make up the five hundred companies with the most sales and profits during the last year. Forbes magazine publishes a list of companies that make up each years Fortune 500 list of companies. The stock of these specific companies is very sought after, and most of the stock for these companies is considered blue chip stock, which is the most sought after class of stock on the stock market.
Stocks for Fortune 500 companies may be extremely hard to find and purchase. These companies have a proven business and financial track record, and when these stocks are available for trade, the price may be very expensive. These stocks are proven money makers, and the risk of the company just folding up and going under are almost nonexistent. This makes these stocks less of a risk than some unknown company with no financial track record, but even stock from Fortune 500 companies is not risk free. Even these stocks can go down in value if market conditions are right. Because of the expensive pricetag for Fortune 500 company stock, the price downslide can be quite expensive if the market falls low enough. These stocks generally have a big chance to rebound back, and there is less chance of a huge loss in the market.
Company earnings play a big part in the rise of a stock price. Fortune 500 companies stand a better chance of great earnings, and therefore a better chance of big payoffs when the earnings drive up the value of a stock. The 500 companies in the Fortune 500 made a total sales record of seven hundred and eighty five billion, which is a huge amount of earnings. Shareholders with these companies generally realized great dividend payments as well as a rising value to their shares of stock.
Trading stock in the Fortune 500 companies does not happen too often. The stock of these companies is greatly valued and much sought after. When stock from any of the five hundred companies is available, it is usually very expensive. These stocks represent companies which have proven to be successful, so there is less risk of a large loss. There is still a risk, though, because even stock from a Fortune 500 company can fall in price, leading to a market loss. These stocks do not generally stay down for long, however, before they start back up.
Copyright ? 2007 Joel Teo. All rights reserved.
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