I want to take a moment to answer a question you may have had about why Apple (NASDAQ:AAPL) wasn’t included in my Top 5 Blue-Chip Stocks for February. It’s a fair question considering the stock has boomed 22% since then.
In selecting my Top 5 stocks, I take several things into account, including fundamental health and buying pressure. But one thing that works behind the scenes is a stock’s risk-to-reward ratio. That’s because I want to include the most stable stocks with the steadiest returns on my Top 5 list. Apple has a history of dramatic price swings, so its risk-reward ratio is higher than my usual threshold for this list.
I know what you’re thinking: “But Apple is such a great stock!” Yes, that’s true. But while Apple is still a premium stock, my monthly Top 5 list is more of a starting point for new investors, so it requires a lower risk-to-reward ratio.
With that said, let’s get to our latest batch of Top 5 stocks: