PRIMECAP Management Company

PRIMECAP Management Company is an independent investment management firm based in Pasadena, California, founded in 1983. The firm specializes in managing U.S.-focused equity portfolios for a select group of institutional clients and mutual funds. PRIMECAP's investment approach is grounded in four key principles: individual decision-making, commitment to fundamental research, long-term investment horizon, and a focus on value. These principles guide the firm's strategy of selecting investments with superior prospects based on new products, markets, management, or structural shifts in demand or supply. Once investments are made, they are typically held for extended periods, often averaging 20 years, reflecting the firm's long-term perspective. This strategy results in low portfolio turnover, typically between 5% and 15% annually. PRIMECAP's portfolio managers operate with a high degree of autonomy, each managing distinct segments of the firm's funds, which fosters independent thinking and reduces groupthink. The firm's commitment to fundamental research and long-term investment horizons has contributed to its strong track record in delivering value to shareholders. PRIMECAP's low-profile approach emphasizes research and portfolio management over sales and marketing, avoiding media interviews and limiting the number of institutional clients to maintain focus on investment performance. This strategy has enabled the firm to manage substantial assets while maintaining a selective client base, including partnerships with entities like The Vanguard Group. As of July 2024, PRIMECAP managed approximately $134 billion in assets, reflecting its significant presence in the investment management industry. The firm's dedication to its investment philosophy and client-focused approach continues to drive its success in the competitive landscape of equity investment management.