When aggressive growth paid off, it paid off big for investors in PBHG Large Cap Growth Fund (PBHLX).

In 1999, that strategy drove the fund up 67%. It outran the S&P 500 index by 46 percentage points and its rivals by 27 points.

Then not only did the bottom fall out, but the top blew off and the sides caved in on aggressive growth strategies. The fund returned -28.5% in 2001 and encored that pratfall with -28.1% in 2002, lagging both its peers and the broad market each year.

But you keep on keeping on if you’re committed to an investment strategy you’ve seen work. Manager Mike Sutton can take some heart in where his $186 million fund is in 2003.

With a fairly focused portfolio of 60 stocks and a willingness to trade — turnover is above 150% a year — Sutton feels an aggressive growth rally coming on.

“This year, for the first time in three years, we have started to see our strategy work,” Sutton said.

The style is momentum investing, fundamentally speaking. Sutton says he’s looking for stocks with revenue and earnings growing at least 15% a year.

Just as important, he wants accelerating growth. He likes upward estimate revisions and upside surprises where companies beat even analysts’ projections

“That is our definition of business momentum,” he said. “Finding those companies over the last 2 1/2 years has been tough. But we are cautiously optimistic that we have gone through the difficult part of our cycle.”

Among his top performers, Bed Bath & Beyond (BBBY) may prove the point. The housewares retailer, his biggest holding, is up 20% this year.

Analysts predict earnings will rise 21% in the fiscal year ending Feb. 28, 2004, and 20% the next year. Sutton believes the company can outrun those numbers.

The portfolio, 65% services, 20% tech hardware and software, and 15% manufacturing, is stocked with similar stories. Amgen Inc (AMGN), the drug maker with a full pipeline of new products, is among his top performers. Amgen shares are up 28% this year.