Primecap Odyssey Stock Fund Investment Insights and Analysis

The Primecap Odyssey Stock Fund is a great option for those looking to invest in a diversified portfolio. It has a long-term track record of outperforming the market.

The fund's investment approach is centered around a team of experienced investment professionals, including Robert Levinson and Kevin Frank. They have a proven ability to identify and invest in high-quality companies.

Investors in the Primecap Odyssey Stock Fund can expect a portfolio that includes a mix of established companies and smaller, more innovative businesses. This diversification helps to minimize risk and maximize returns over the long-term.

The fund's focus on long-term growth means that it may not be the best fit for those looking for quick profits or short-term gains.

The Primecap Odyssey Stock Fund primarily invests in the common stocks of U.S. companies, with an emphasis on those with prospects for rapid earnings growth.

It invests across all market sectors and market capitalizations, including mid- and small-capitalization companies, and may also invest in foreign securities.

The fund has historically invested significant portions of its assets in these smaller companies, allowing it to potentially tap into emerging growth opportunities.

The Advisor, PRIMECAP Management Company, uses a bottom-up stock selection process to identify stocks with attractive growth prospects.

It seeks to identify stocks that will grow faster and/or be more profitable than their current market valuations suggest, often with little current income.

The Advisor maintains a long-term focus, aiming to identify stocks that will outperform the S&P 500 index over a three- to five-year time frame.

The fund may maintain a significantly overweight or underweight position in a particular sector relative to the S&P 500 index at any time, allowing it to adapt to changing market conditions.

It invests at least 80% of its assets in stocks, with the option to invest in foreign securities through depository receipts or stocks traded on a foreign exchange.

The Advisor looks for companies with asset values not adequately reflected in their stock prices, providing a potential opportunity for long-term growth.

The fund's investment strategy is driven by fundamental research, seeking to identify catalysts for growth such as new products, new markets, new management, or industry dynamics.

The PrimeCap Odyssey Stock Fund has a notable growth chart compared to the S&P 500 index, which serves as a benchmark. The fund's performance is adjusted for splits and dividends.

The chart shows that the fund's initial investment of $10,000 has grown over time, but it's essential to compare it to the benchmark to understand its performance. The S&P 500 index has consistently outperformed the PrimeCap Odyssey Stock Fund in terms of growth.

In fact, over the past 10 years, the S&P 500 had an annualized return of 11.51%, while the PrimeCap Odyssey Stock Fund had an annualized return of 10.49%. This indicates that the fund did not perform as well as the benchmark.

Here's a summary of the fund's performance in the last 12 months:

It's worth noting that the fund's performance can be volatile, as seen in the chart, with some months showing significant growth and others showing significant losses.

Investing in the PrimeCap Odyssey Stock Fund comes with inherent risks, including stock market risk, which is the chance that overall stock prices will decline. This can be a significant concern for investors, especially during periods of economic downturn.

Stock market cycles tend to move in waves, with periods of rising prices followed by periods of falling prices. This can be a challenging environment for investors, but it's essential to understand that it's a normal part of the market's behavior.

Manager risk is another concern, as the Fund's Advisor may make poor security selections, leading to underperformance compared to benchmarks or other funds with similar investment objectives. This highlights the importance of a skilled and experienced investment team.

The Fund's investment style, which focuses on small-, mid-, and large-cap stocks, also carries risks. Historically, small- and mid-cap stocks have been more volatile in price than large-cap stocks, and they often perform differently. This can result in significant losses if not managed properly.

Here are some of the key risks associated with the PrimeCap Odyssey Stock Fund:

Fees & Expenses play a significant role in Risk Management. Understanding the costs associated with investing is crucial for making informed decisions.

The expense ratio of POSKX is 0.65%, which falls within the medium range. This means that for every dollar invested, 0.65 cents go towards expenses.

Management fees are a key component of Fees & Expenses. In the case of POSKX, the management fee is 0.55%. This fee is charged annually and is a percentage of the fund's total assets.

Other expenses, such as administrative costs, also contribute to the overall expense ratio. For POSKX, other expenses amount to 0.11%.

Acquired fund fees and expenses are also a factor, although in this case, they are 0.00% for POSKX.

Here's a breakdown of the fees and expenses for POSKX:

It's worth noting that the total annual fund operating expenses for POSKX are 0.66%, 0.01% higher than the expense ratio.

The Sharpe ratio of the PrimeCap Odyssey Stock Fund is 1.43, which is a good indicator of its historical performance in terms of risk-adjusted returns.

This means that for every unit of risk taken, the fund has generated a return of 1.43 units, which is a significant advantage over other investments.

The fund's Sharpe ratio is calculated based on the past 1 year of trading data and takes into account price changes and dividends.

The chart below shows the growth of an initial investment of $10,000 in the PrimeCap Odyssey Stock Fund, comparing it to the performance of the S&P 500 index.

The fund's volatility is 4.01%, which is the average percentage change in the investment's value over the past month.

Risk-adjusted performance metrics, such as the Sharpe ratio, are essential tools for investors to evaluate an investment's returns against its associated risks.

The charts below present risk-adjusted performance metrics for the PrimeCap Odyssey Stock Fund and compare them to a chosen benchmark, providing valuable insights for investors.

The fund's current volatility is a relatively low 4.01%, which suggests that it has been a relatively stable investment over the past month.

Investing in the stock market can be a rollercoaster ride, with prices fluctuating wildly. You should expect the Fund's share price and total return to fluctuate within a wide range, like the fluctuations of the overall stock market.

Stock market risk is a major concern. The chance that stock prices overall will decline is a significant risk factor. Stock markets tend to move in cycles, with periods of rising prices and periods of falling prices.

Manager risk is another potential pitfall. Poor security selection by the Advisor can lead to underperformance relative to benchmarks or other funds with similar investment objectives.

Investment style risk can also impact the Fund's performance. Historically, small- and mid-cap stocks have been more volatile in price than the large-cap stocks that dominate the overall stock market.

Here are some of the key risks associated with investing in the Fund:

Foreign securities risk is a complex issue. Investing in foreign securities involves country risk, which is the chance that domestic events will weaken a country's securities markets, and currency risk, which is the chance that the value of a foreign investment will decrease due to unfavorable changes in currency exchange rates.

Risk management is a crucial aspect of investing, and understanding drawdowns can help you make informed decisions. A drawdown is a measure of risk, indicating the largest reduction in portfolio value due to a series of losing trades.

The PrimeCap Odyssey Stock Fund has experienced significant drawdowns in the past, with the maximum drawdown being 50.61% on March 9, 2009. This was a tough time for investors, but the fund recovered over 492 trading sessions.

The table below shows the worst drawdowns for the PrimeCap Odyssey Stock Fund:

The current drawdown for the PrimeCap Odyssey Stock Fund is 1.19%, which is significantly lower than the worst drawdowns experienced in the past. This highlights the importance of risk management and regular portfolio reviews to minimize potential losses.