TCW Galileo Select Equity N fund has made a big bet on the future performance of one big auto-insurance company. Its largest holding, Progressive Corp. (PGR) makes up almost 10% of net assets of the formidable large-cap growth fund.

Select Equity manager Glen Bickerstaff says the companies he buys for the fund "have succeeded in difficult times," are fast-growing and have some sustainable edge over their peers. (For more about Select Equity, see "A Leader Among Large-Caps.") He especially likes Progressive because it bypasses agents and sells its insurance policies directly to individuals. That keeps premiums down and profit margins up.

The stock has performed anemically over the past year and is trading just a few dollars up from its 52-week low of $44.75. But that may present a buying opportunity. The company's revenues have grown steadily since 1997 and analysts expect earnings to bounce back nicely -- from the $1.82 the company posted in 2002 to $3.51 per share in fiscal 2003.

-- Elizabeth Frengel

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