Philosophy & Results

Camargo Investment Management, Ltd. utilizes two complementary strategies – Growth/Price Momentum and Value Investing in the management of equity portfolios.

Large capitalized companies are those that are categorized as Value Situations of well-established companies that have been in existence for fifty years or more and which have a high dividend yield, similar to “Dogs of the Dow.” A few examples would be Pfizer, AT&T, J.P. Morgan and ConocoPhillips.

Lesser capitalized companies are those that are categorized as Growth Situations involved in newer, faster growing industries established in the last 5-20 years. These companies are growing at 10-15% per year. A few examples would be TJ Maxx, Celegene, Mylan and Visa. Often these stocks are hitting new highs. The value companies provide stability to the portfolio while the newer companies provide the growth to the portfolio.

Consistent with the investment philosophy of Growth and Value, portfolios typically consist of 20-25 stocks in two independently managed groups: the Value group and the Growth/Momentum group.

The Value group stocks are selected from the 100 candidate LARGCAP Universe on the basis of dividend yield, dividend coverage, earning growth and financials; each stock then is sold when these factors deteriorate. This group of stocks are the Downside Protectors, which are expected to perform well in difficult markets.

Growth/Momentum group stocks are selected from the Russell 2000 on the basis of superior earnings and overall superior stock momentum. This group consist of “buy high and sell higher.” These stocks are the Performance Drivers, and are expected to perform well in favorable markets. As a result, the Growth and Value Equity Strategy has the opportunity to provide superior returns in all phases of the market cycle, and the use of multiple sets of buy/sell results in a consistent pattern of superior returns. As long as they remain superior earnings growers, or as the stocks’ technicals or market action dictates, the stocks will remain in the portfolio.

The Growth/Momentum group tends to outperform in favorable markets. The Value Group dampens volatility on the downside yet participates in up markets. The result? Sustained growth and risk mitigation. Contact us today to let the stock market work for you.