Our Small Cap Quality Growth strategy focuses on owning small-size companies with an average market capitalization between $200 million and $3.0 billion. Protection of capital in falling markets, providing an above-average income stream, and strong performance all relative to small-size company managers embody the strategy’s goals.
Bahl & Gaynor’s equity selection process yields an investable universe of companies that are managed conservatively and for long-term growth, have stable and sustainable business models, and currently reward or have the future ability to reward shareholders of the company with a dividend. From this investable universe, the Small Cap Quality Growth strategy seeks small-size companies that currently pay dividends, or have the ability to initiate dividend payments in the future.
Over a full market cycle of five to seven years, Bahl & Gaynor’s Small Cap Quality Growth strategy seeks to outperform its benchmark and small-capitalization growth peers all in the context of a lower-than-average portfolio risk profile.
Client portfolios will generally be diversified among a selection of 65 to 85 common stock issues with each security typically held for three to five years. Low portfolio turnover combined with the favorable tax treatment of dividend income results in a cost and tax-efficient portfolio.