United States
Securities and Exchange Commission
Washington, D.C. 20549

Form N-Q

Quarterly Schedule of Portfolio Holdings of Registered
Management Investment Company
Investment Company Act file number: 811-05807
Eagle Capital Growth Fund, Inc.
(Exact name of registrant as specified in charter)
 
225 East Mason Street, Suite 802, Milwaukee, WI 53202-3657
(Address of principal executive offices) (zip code)
Luke E. Sims, President
Eagle Capital Growth Fund, Inc.
225 East Mason Street
Suite 802
Milwaukee, WI 53202-3657
(414) 765-1107
(Name and address of agent for service)
Registrant's telephone number, including area code:
(414) 765-1107

Date of fiscal year end: December 31, 2013

Date of reporting period: September 30, 2013
 
ITEM 1. SCHEDULE OF INVESTMENTS
Eagle Capital Growth Fund, Inc.
Portfolio of Investments (as of September 30, 2013) (unaudited)

Industry
  
   
   
   
 
 
  
   
   
   
 
Common Stock (94.3% of total investments)
  
   
   
   
 
Industry
  
   
   
   
 
Bank
  
Shares
    
Cost
    
Market Value
    
% Total Inv.
  
Wells Fargo & Company
    
15,000
      
597,750
     $
619,800
    
 
 
                  
$
619,800
      
(2.2
%)
Consumer
                                
The Coca-Cola Company
    
28,000
      
1,058,939
      
1,060,640
          
Colgate-Palmolive Co.
    
12,000
      
72,938
      
711,600
          
PepsiCo, Inc.
    
10,000
      
168,296
      
795,000
          
 
                  
$
2,567,240
      
(9.2
%)
Data Processing
                                
Automatic Data Processing, Inc.
    
17,000
      
600,933
      
1,230,460
          
Paychex, Inc.
    
31,000
      
797,952
      
1,259,840
          
 
                  
$
2,490,300
      
(8.9
%)
Drug/Medical Device
                                
Abbott Laboratories Inc.
    
7,500
      
175,588
      
248,925
          
Johnson & Johnson
    
4,000
      
45,500
      
346,760
          
Stryker Corp.
    
18,000
      
82,375
      
1,216,620
          
 
                  
$
1,812,305
      
(6.5
%)
Industrial
                                
Deere & Company
    
20,000
      
1,681,501
      
1,627,800
          
Emerson Electric Co.
    
20,000
      
900,188
      
1,294,000
          
Hillenbrand, Inc.
    
51,000
      
987,591
      
1,395,870
          
Illinois Tool Works Inc.
    
17,000
      
786,916
      
1,296,590
          
Sigma-Aldrich Corp.
    
16,000
      
498,184
      
1,364,800
          
Waters Corp.*
    
6,000
      
302,341
      
637,260
          
 
                  
$
7,616,320
      
(27.3
%)
Insurance
                                
AFLAC Corp.
    
19,000
      
1,018,259
      
1,177,810
          
Berkshire Hathaway Inc.*
    
17,000
      
1,303,475
      
1,929,670
          
The Chubb Corporation
    
14,000
      
715,049
      
1,249,640
          
 
                  
$
4,357,120
      
(15.6
%)
Mutual Fund Managers
                                
Eaton Vance Corp.
    
28,000
      
607,484
      
1,087,240
          
Franklin Resources, Inc.
    
45,000
      
1,884,581
      
2,274,750
          
T Rowe Price Group Inc.
    
14,000
      
987,352
      
1,007,020
          
 
                  
$
4,369,010
      
(15.6
%)
Closed-End Funds
                                
Central Securities Corporation
    
49,643
      
1,151,301
      
1,163,135
          
First Trust Dividend Income Fund
    
160,300
      
1,329,982
      
1,348,123
          
 
                  
$
2,511,258
      
(9.0
%)
 
                                
Total common stock investments
                  
$
26,343,353
          
Money Market Funds (5.7% of total investments)
                  
LEVEL ONE
          
 
                                
Federated Government Obligations Fund #5 Institutional, 0.01%
            
$
1,583,985
      
(5.7
%)
Total Money Market Investment
                  
$
1,583,985
          
 
                                
Total investments
                  
$
27,927,338
          
All other assets less liabilities
                    
51,406
          
Accrued investment advisory fees
                    
(18,400
)
        
Total net assets
                  
$
27,960,344
          
*Non-dividend paying security
                                
 
Footnote:

The following information is based upon federal income tax cost of portfolio investments as of September 30, 2013:

Gross unrealized appreciation
  
$
8,654,301
  
Gross unrealized depreciation
    
(65,424
)
Net unrealized appreciation
  
$
8,588,877
  
 
        
Federal income tax basis
  
$
17,754,477
  

ITEM 2. Controls and Procedures
 
(a) As of October 1, 2013, an evaluation of the effectiveness of the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) was performed by management with the participation of the registrant's President and Chief Executive Officer (who is the principal executive officer of the registrant) and the registrant’s Chief Financial Officer (who is the principal financial officer of the registrant).  Based on that evaluation, the registrant's President and Chief Executive Officer and Chief Financial Officer concluded that the registrant's disclosure controls and procedures are effectively designed to ensure that information required to be disclosed by the registrant is recorded, processed, summarized and reported within the time periods specified by the Commission's rules and forms, and that information required to be disclosed by the registrant has been accumulated and communicated to the registrant's management, including its principal executive officer and principal financial officer, or persons performing similar functions as appropriate to allow timely decisions regarding required disclosure.

(b) Fair Value Accounting—Accounting standards require certain assets and liabilities be reported at fair value in the financial statements and provides a framework for establishing that fair value. The framework for determining fair value is based on a hierarchy that prioritizes the inputs and valuation techniques used to measure fair value.

In general, fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.

Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly.  These Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.

Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset.  These level 3 fair value measurements are based primarily on management’s own estimates using pricing models, discounted cash flow methodologies, or similar techniques taking into account the characteristics of the asset.