Blue chip is one of the oldest terms in investing. It describes large, well established companies with a long record of steady performance and market leadership. Many of the best known US technology companies sit in this group.
For a South African, owning shares in these companies has meant opening a brokerage account, using a separate platform and converting rand to dollars. BlueChip+ brings a slice of that market together with Bitcoin (BTC) and Ethereum (ETH) in one Luno investment, bought in the same way as any other crypto asset on Luno.
At a glance
Blue chip stocks are large, well established companies with a long record of steady performance.
BlueChip+ holds BTC and ETH alongside tokenised stocks in large US technology companies.
The target split is 30% digital assets and 70% tokenised stocks, rebalanced every quarter.
A 1% transaction fee and a 2% annual tracking fee apply.
What is meant by “blue chip”?
The term comes from poker, where the blue chip carries the highest value on the table. In investing, it came to describe shares in large, financially sound companies. These sit at the more dependable end of the equity market, which is the market for company shares, compared with smaller, newer or more volatile names.
Blue chip does not mean free of risk. The share prices of even the largest companies can fall. The label points to market leadership and staying power, not to a guaranteed outcome.
What BlueChip+ holds
BlueChip+ follows a set of rules and holds two sides. A tokenised stock is a digital token designed to track the price of a share in a listed company.
Digital assets, 30% target: BTC and ETH, which is the plus in the name.
Tokenised stocks, 70% target: a small group of large US technology companies, similar in spirit to the household names the financial press groups as the Magnificent 7. BlueChip+ is not an index of those seven companies.
Rebalancing: every quarter, the bundle returns to its target split. If one side has grown faster than the other, the bundle sells part of it and buys more of the other side. This needs no action from you.
The fact sheet explains how dividends are treated.
Why pair crypto with technology stocks
Crypto and large technology shares are different types of asset, and they can move for different reasons. Pairing them offers exposure to two parts of the market in a single purchase, in place of two accounts and two separate decisions.
Combining assets does not remove risk or guarantee smoother returns, and both sides can fall at the same time. Owning more assets does not make a portfolio diversified, a point Luno covers in its guide to common misunderstandings about diversification.
For a crypto only approach, Luno's Large Cap bundle tracks the five largest digital assets.
What it costs
Two fees apply to BlueChip+:
Transaction fee: 1% when you buy, top up or sell.
Annual tracking fee: 2%, which accrues daily and is deducted quarterly.
Fees reduce the value of an investment, and the fact sheet sets out the full detail.
Get started
A bundle holds a set of assets in one purchase, so a reader new to crypto or to US technology shares does not need to research and select each name.
You can invest in BlueChip+ from the Luno Bundles page, or download the fact sheet for the full detail on:
How the bundle is built
Fees
Rebalancing
Performance history
