Your take on Primecap Odyssey funds

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It seems, Primecap Odyssey funds are well kept secret by Vanguard. On paper, funds like =12pxPOGRX out-perform S&P by quite a margin (according to yahoo). However, I was checking their prospectus and looks like after tax, their return is very similar to S&P.  I am not sure why Vanguard maintain this actively managed fund family. What I am missing here?

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delhel said:   It seems, Primecap Odyssey funds are well kept secret by Vanguard. On paper, funds like =12pxPOGRX out-perform S&P by quite a margin (according to yahoo). However, I was checking their prospectus and looks like after tax, their return is very similar to S&P.  I am not sure why Vanguard maintain this actively managed fund family. What I am missing here?
 

1.) You can have PRIMECAP funds in non-taxed accounts.
2.) PRIMECAP Odyssey funds have nothing to do with Vanguard.  You can own PRIMECAP Odyssey Stock Fund, PRIMECAP Odyssey Growth Fund, and PRIMECAP Odyssey Aggressive Growth Fund (latter closed to new investors) without having anything to do with Vanguard, they are completely separate companies.   PRIMECAP manages several separate Vanguard funds too, PRIMECAP Core, PRIMECAP Fund, Capital Opportunity.

"A $10,000 investment in (Vanguard) Primecap three decades ago would be worth nearly $500,000 today, more than double what you would have earned in an index fund that tracks the overall stock market." http://www.kiplinger.com/article/investing/T041-C009-S002-primec... 

The ER is 11x that of a similar Vanguard offering....

NEDeals said:   
delhel said:   It seems, Primecap Odyssey funds are well kept secret by Vanguard. On paper, funds like =12pxPOGRX out-perform S&P by quite a margin (according to yahoo). However, I was checking their prospectus and looks like after tax, their return is very similar to S&P.  I am not sure why Vanguard maintain this actively managed fund family. What I am missing here?
 

1.) You can have PRIMECAP funds in non-taxed accounts.
2.) PRIMECAP Odyssey funds have nothing to do with Vanguard.  You can own PRIMECAP Odyssey Stock Fund, PRIMECAP Odyssey Growth Fund, and PRIMECAP Odyssey Aggressive Growth Fund (latter closed to new investors) without having anything to do with Vanguard, they are completely separate companies.   PRIMECAP manages several separate Vanguard funds too, PRIMECAP Core, PRIMECAP Fund, Capital Opportunity.

"A $10,000 investment in (Vanguard) Primecap three decades ago would be worth nearly $500,000 today, more than double what you would have earned in an index fund that tracks the overall stock market." http://www.kiplinger.com/article/investing/T041-C009-S002-primec...

  that Kiplinger article made glowing praise for the fund family. Looking at one of their current offering, I am wondering how far that can be true.
PRIMECAP Odyssey Growth Fund                        
                        
                                 1 Year         5 Year         10 Year       Since Inception (11/1/2004)    
Return Before Taxes        6.18%         13.98%         9.50%         10.45%

Return After Taxes 
on Distributions               5.86%         13.57%         9.25%         10.23%

Return After Taxes 
on Distributions and 
Sale of Fund Shares         3.76%         11.21%         7.80%         8.72%

S&P 500®(reflects no
deductions for fees, 
expenses, or taxes)         1.38%         12.57%         7.31%         7.68%
 
 

It looks like since inception, it beat S&P 500 by just 1 percent yet the fees are quite high. So, are these funds really as good as Kiplinger portrayal?

delhel said:   
NEDeals said:   
delhel said:   It seems, Primecap Odyssey funds are well kept secret by Vanguard. On paper, funds like =12pxPOGRX out-perform S&P by quite a margin (according to yahoo). However, I was checking their prospectus and looks like after tax, their return is very similar to S&P.  I am not sure why Vanguard maintain this actively managed fund family. What I am missing here?
 

1.) You can have PRIMECAP funds in non-taxed accounts.
2.) PRIMECAP Odyssey funds have nothing to do with Vanguard.  You can own PRIMECAP Odyssey Stock Fund, PRIMECAP Odyssey Growth Fund, and PRIMECAP Odyssey Aggressive Growth Fund (latter closed to new investors) without having anything to do with Vanguard, they are completely separate companies.   PRIMECAP manages several separate Vanguard funds too, PRIMECAP Core, PRIMECAP Fund, Capital Opportunity.

"A $10,000 investment in (Vanguard) Primecap three decades ago would be worth nearly $500,000 today, more than double what you would have earned in an index fund that tracks the overall stock market." http://www.kiplinger.com/article/investing/T041-C009-S002-primec...

  that Kiplinger article made glowing praise for the fund family. Looking at one of their current offering, I am wondering how far that can be true.

PRIMECAP Odyssey Growth Fund                        
                        
                                 1 Year         5 Year         10 Year       Since Inception (11/1/2004)    
Return Before Taxes        6.18%         13.98%         9.50%         10.45%

Return After Taxes 
on Distributions               5.86%         13.57%         9.25%         10.23%

Return After Taxes 
on Distributions and 
Sale of Fund Shares         3.76%         11.21%         7.80%         8.72%

S&P 500®(reflects no
deductions for fees, 
expenses, or taxes)         1.38%         12.57%         7.31%         7.68%
 
 

It looks like since inception, it beat S&P 500 by just 1 percent yet the fees are quite high. So, are these funds really as good as Kiplinger portrayal?

  
The returns include the fund fees.  Funds with a lot of taxable distributions are better suited for a non-taxed account unless their returns can justify the extra taxes--in my opinion. 

delhel said:   
NEDeals said:   
delhel said:   It seems, Primecap Odyssey funds are well kept secret by Vanguard. On paper, funds like =12pxPOGRX out-perform S&P by quite a margin (according to yahoo). However, I was checking their prospectus and looks like after tax, their return is very similar to S&P.  I am not sure why Vanguard maintain this actively managed fund family. What I am missing here?
 

1.) You can have PRIMECAP funds in non-taxed accounts.
2.) PRIMECAP Odyssey funds have nothing to do with Vanguard.  You can own PRIMECAP Odyssey Stock Fund, PRIMECAP Odyssey Growth Fund, and PRIMECAP Odyssey Aggressive Growth Fund (latter closed to new investors) without having anything to do with Vanguard, they are completely separate companies.   PRIMECAP manages several separate Vanguard funds too, PRIMECAP Core, PRIMECAP Fund, Capital Opportunity.

"A $10,000 investment in (Vanguard) Primecap three decades ago would be worth nearly $500,000 today, more than double what you would have earned in an index fund that tracks the overall stock market." http://www.kiplinger.com/article/investing/T041-C009-S002-primec...

  that Kiplinger article made glowing praise for the fund family. Looking at one of their current offering, I am wondering how far that can be true.

PRIMECAP Odyssey Growth Fund                        
                        
                                 1 Year         5 Year         10 Year       Since Inception (11/1/2004)    
Return Before Taxes        6.18%         13.98%         9.50%         10.45%

Return After Taxes 
on Distributions               5.86%         13.57%         9.25%         10.23%

Return After Taxes 
on Distributions and 
Sale of Fund Shares         3.76%         11.21%         7.80%         8.72%

S&P 500®(reflects no
deductions for fees, 
expenses, or taxes)         1.38%         12.57%         7.31%         7.68%
 
 

It looks like since inception, it beat S&P 500 by just 1 percent yet the fees are quite high. So, are these funds really as good as Kiplinger portrayal?

  
but the SP500 index reflects no deductions for fees/expenses/taxes!!!   Apples & Oranges?  
Not to mention if you have this fund in tax exempt accounts.

For a passively managed S&P 500 fund, I believe that those numbers will not be very significant.

delhel said:   For a passively managed S&P 500 fund, I believe the those numbers will not be very significant.


  with fund expense will be around 0.10% .... i would think taxes will be at least another .15% - net net another .25%.  Add that to 1% advantage it already has over 10 years - you're dong pretty good.    Plus, i would assume most people would have some of it in 401K as well where you don't have to worry about the tax impact.

Very confusing naming of funds. We've had some Vanguard PRIMECAP Fund (VPMAX) shares for over 13 years and it's performed pretty well (~2.5%/yr over S&P). ER is 0.35% which is not too bad for actively managed fund and performance has justified it.

But I had no idea that PRIMECAP had tons of other funds available. Maybe because VPMAX is closed (and has been for a long time) so they started new offerings trying to cash in on success of previous funds.

Shandril said:   Very confusing naming of funds. We've had some Vanguard PRIMECAP Fund (VPMAX) shares for over 13 years and it's performed pretty well (~2.5%/yr over S&P). ER is 0.35% which is not too bad for actively managed fund and performance has justified it.

But I had no idea that PRIMECAP had tons of other funds available. Maybe because VPMAX is closed (and has been for a long time) so they started new offerings trying to cash in on success of previous funds.

  
Vanguard hires PrimeCAP to manage one of their fund .. and that's Vanguard PrimeCap.   PrimeCap separately has their own fund.  I'm assuming going with vanguard is cheaper like any other vanguard fund - but the issue is i think VPMAX is closed to new investor now.

prozario said:   
Shandril said:   Very confusing naming of funds. We've had some Vanguard PRIMECAP Fund (VPMAX) shares for over 13 years and it's performed pretty well (~2.5%/yr over S&P). ER is 0.35% which is not too bad for actively managed fund and performance has justified it.

But I had no idea that PRIMECAP had tons of other funds available. Maybe because VPMAX is closed (and has been for a long time) so they started new offerings trying to cash in on success of previous funds.

  
Vanguard hires PrimeCAP to manage one of their fund .. and that's Vanguard PrimeCap.   PrimeCap separately has their own fund.  I'm assuming going with vanguard is cheaper like any other vanguard fund - but the issue is i think VPMAX is closed to new investor now.

  Yep, the only way to get in Vanguard PrimeCap at the moment is via one of Vanguard's Variable Annuities. Or if you are flagship.

FYI...If you are a Vanguard Flagship customer, you're still able to get into the Vanguard Primecap funds albeit. You're limited to $25k per year in contributions.

caproperty said:   FYI...If you are a Vanguard Flagship customer, you're still able to get into the Vanguard Primecap funds albeit. You're limited to $25k per year in contributions.
  $1M to $5M asset ...

prozario said:   
caproperty said:   FYI...If you are a Vanguard Flagship customer, you're still able to get into the Vanguard Primecap funds albeit. You're limited to $25k per year in contributions.
  $1M to $5M asset ...

  
I agree that this limits it to a much smaller pool of people

caproperty said:   
prozario said:   
caproperty said:   FYI...If you are a Vanguard Flagship customer, you're still able to get into the Vanguard Primecap funds albeit. You're limited to $25k per year in contributions.
  $1M to $5M asset ...

  
I agree that this limits it to a much smaller pool of people

  

there are soo many good Mutual funds, it is not a big deal if one gets closed.  Even in vanguard you'll find bunch of other good funds. 

I've been very happy with Vanguard Strategic Equity and Fidelity Low Price stock funds.
 

prozario said:   
Shandril said:   Very confusing naming of funds. We've had some Vanguard PRIMECAP Fund (VPMAX) shares for over 13 years and it's performed pretty well (~2.5%/yr over S&P). ER is 0.35% which is not too bad for actively managed fund and performance has justified it.

But I had no idea that PRIMECAP had tons of other funds available. Maybe because VPMAX is closed (and has been for a long time) so they started new offerings trying to cash in on success of previous funds.

  
Vanguard hires PrimeCAP to manage one of their fund .. and that's Vanguard PrimeCap.   PrimeCap separately has their own fund.  I'm assuming going with vanguard is cheaper like any other vanguard fund - but the issue is i think VPMAX is closed to new investor now.

  
PRIMECAP manages three Vanguard funds, not just one.  To recap my earlier post, they are:

  • Vanguard PRIMECAP
  • Vanguard PRIMECAP Core
  • Vanguard Capital Opportunity



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