If you're wanting to construct a balanced portfolio, having a few blue chip ASX shares in there could be a smart move.
The reason for this is that blue chip shares tend to be companies that are well-known, long-established, and have strong financial positions. Essentially, they aren't going anywhere any time soon.
This should allow investors to make long term investments that benefit from compounding.
But which blue chip ASX shares should you buy? Two that are highly rated are listed below:
BHP Group Ltd (ASX: BHP)
If you're not averse to investing in the resources sector, then BHP could be worth considering.
The Big Australian owns a diverse portfolio of world class and low cost operations across the globe. While it has exposure to a wide range of commodities, the key one right now is iron ore.
Thanks largely to the sky high iron ore price, but also favourable prices of other commodities, BHP has been tipped to deliver a bumper profit result in FY 2021.
Analysts at Ord Minnett are very positive on the mining giant. They currently have a buy rating and $52.00 price target on its shares. Ord Minnett believes BHP is well-placed to outperform in the post-COVID environment.
Ramsay Health Care Limited (ASX: RHC)
Another ASX blue chip share to look at is Ramsay Health Care. It is a leading private healthcare company with operations across the world.
Although trading conditions were tough for Ramsay in 2020 because of the pandemic, things are starting to improve.
For example, analysts at Goldman Sachs believe Ramsay is trading largely as normal in Australia now. This is a big positive given that an estimated two-thirds of its earnings are generated in the local market.
Looking ahead, the broker feels Ramsay is well-placed to benefit from a catch up in procedures that were delayed during the pandemic.
Goldman Sachs has a conviction buy rating and $70.00 price target on its shares.
