What is a Capital Growth Strategy?

A capital growth strategy is an aggressive investment approach in which the investor seeks maximum capital appreciation. This asset management strategy is a long-term approach that employs a risky, equities-based strategy aimed at high profits. While the percentage of equities within a capital growth strategy can vary, it is usually at least 65% with some diversification achieved through the inclusion of fixed-income securities, cash, and other assets.

Most often, a capital growth strategy investor chooses growth stocks as their primary equity investment. By focusing on small and mid-cap stocks, investors give themselves the best opportunity to beat average market returns. The strategy, however, is not a viable one for investors with shorter-term horizons due to the volatility and risk it brings.

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The above information is educational and should not be interpreted as financial advice. For advice that is specific to your circumstances, you should consult a financial or tax advisor.

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