Widow-and-orphan stocks are traditionally low-volatility yet high-dividend paying stocks that are held as blue chip companies in non-cyclical industries like consumer staples. The term originated in the late 19th century and is no longer used commonly today. Widow-and-orphan stocks were intended as a way to provide fiscally responsible, reliable income to widows and orphans who had limited means and resources to invest in the stock market.

Widow-and-orphan stocks have historically been thought of as low-risk investments with the highest yield of the traditional stocks. They have a long history of dividend payments and have been known to be issued by large, established companies.

These stocks tend to be in non-cyclical industries like consumer staples, utilities, health care, and telecommunications. These types of industries have products or services that generally have a stable demand and do not fluctuate significantly with economic cycles. They are also often less affected by market downturns as people purchase these items even in times of economic recession. This makes them a reliable option for stock investors as compared to stocks in more volatile industries like technology or finance.

Although widow-and-orphan stocks are not as popular as they once were, large-cap value stock investors still tend to pick stocks that could be considered widow-and-orphan stocks. These investors are looking for stocks that offer reliable income and less volatile movements in prices. As such, they tend to look at blue chip companies with a long track record of dividend payments and steady stock prices.

In summation, widow-and-orphan stocks are stocks that provide reliable income and low volatility movements. Historically, these stocks originate in veteran companies in non-cyclical industries like consumer staples and health care. Even though the phrase “widow-and-orphan stock” is no longer used, large-cap value stock investors still seek companies with traits that meet the definition of the widow-and-orphan stock. These include a long record of dividend payments and stability in stock prices.