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Is PRIMECAP Odyssey Stock Fund (POSKX) a Strong Mutual Fund Pick Right Now?

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Looking for a Large Cap Growth fund? You may want to consider PRIMECAP Odyssey Stock Fund (POSKX - Free Report) as a possible option. POSKX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We classify POSKX in the Large Cap Growth category, an area rife with potential choices. Large Cap Growth funds invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. To be considered large-cap, companies must have a market cap over $10 billion.

History of Fund/Manager

POSKX finds itself in the Primecap Odyssey family, based out of Pasadena, CA. PRIMECAP Odyssey Stock Fund made its debut in November of 2004, and since then, POSKX has accumulated about $7.41 billion in assets, per the most up-to-date date available. The fund's current manager, a team of investment professionals.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. POSKX has a 5-year annualized total return of 16.97% and it sits in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 12.36%, which places it in the top third during this time-frame.

When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Compared to the category average of 11.49%, the standard deviation of POSKX over the past three years is 11.4%. The standard deviation of the fund over the past 5 years is 10.17% compared to the category average of 10.91%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In POSKX's case, the fund lost 45.41% in the most recent bear market and outperformed its peer group by 3.47%. This makes the fund a possibly better choice than its peers during a sliding market environment.

Even still, the fund has a 5-year beta of 1.02, so investors should note that it is hypothetically as volatile as the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. Over the past 5 years, the fund has a positive alpha of 1.36. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

Holdings

Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is mostly on equities that are traded in the United States.

This fund is currently holding about 92.7% stock in stocks, which have an average market capitalization of $91.58 billion. The fund has the heaviest exposure to the following market sectors:

  1. Technology
  2. Industrial Cyclical
  3. Finance
  4. Health

With turnover at about 6%, this fund makes fewer trades than the average comparable fund.

Expenses

As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, POSKX is a no load fund. It has an expense ratio of 0.68% compared to the category average of 1.14%. POSKX is actually cheaper than its peers when you consider factors like cost.

This fund requires a minimum initial investment of $2,000, and each subsequent investment should be at least $100.

Bottom Line

Overall, PRIMECAP Odyssey Stock Fund POSKX has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

Want even more information about POSKX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.




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