How Vanguard Primecap Turned a Rough Stretch Into a Historic Rally

Key Morningstar Metrics for Vanguard Primecap VPMCX

• Morningstar Medalist Rating
  : Gold
• Process Pillar
  : Above Average
• People Pillar
  : High
• Parent Pillar
  : High

With its accomplished investment team and unique multimanager approach, Vanguard Primecap remains exemplary.

Subadvisor Primecap Management runs the fund through five experienced portfolio managers. Each independently runs a sleeve of the portfolio. Firm co-founder Theo Kolokotrones has run a portion of the fund since 1985, and Joel Fried since 1988, giving the team unusually long tenure. Alfred Mordecai became a manager here at year-end 1999, Mohsin Ansari in 2007, and James Marchetti in early 2015. A deep bench of equity analysts divides coverage by sector and runs small slices of assets—an in-house apprenticeship that has repeatedly produced the firm’s next generation of managers. In March 2026, Primecap announced that Fried will retire at the end of 2026. Because the portfolio is spread across distinct sleeves and four other primary managers, and the analyst-run sleeves remain, the transition should be manageable.

The fund is one of six impressive multimanager funds Primecap runs, and it looks unlike any index or actively managed rival. It aims to provide broad US-market exposure but keeps mega-cap exposure relatively modest. Rather than showcase the market’s biggest recent winners, Primecap’s team often pursues out-of-favor companies with brighter prospects than the market recognizes—including value stocks, on occasion. The managers express similar industry views across the firm’s strategies, and it is mild-mannered compared with offerings such as Primecap Odyssey Growth POGRX and Primecap Odyssey Aggressive Growth POAGX, which hold much more in small caps.

Each manager practices a fundamentals-based, benchmark-agnostic approach and tolerates volatility, sticking with picks they still believe in for a decade or more. Those stylistic predilections held the fund back during the years through 2023, but the same patient, differentiated positioning has driven strong results since the start of 2024, led by outstanding results from its semiconductor stake.

The fund’s long-term investors have done well; over the past decade, it has far outpaced the broad market and the typical actively managed rival.

Vanguard Primecap: Performance Highlights

The fund boasts an outstanding long-term track record that stretches back to the mid-1980s, when Theo Kolokotrones, the longest-tenured manager, started. Over the past decade—when all the current named portfolio managers were continuously at the helm—the fund’s investor share class gained 18.5% annualized through June 2026, among the best results in the large-blend

and well ahead of the S&P 500. It also comfortably outpaced the large-growth category average, which is relevant given the fund’s historical tilt toward growth stocks. (Morningstar classified it as a large-growth fund from 2007 to mid-2021.)

The team’s stock-picking had underwhelmed in some years over the past decade through 2023 but has excelled since then. From the start of 2024 through June 2026, it gained 29.9% annualized, far outpacing the S&P 500’s 21.4%. Semiconductors were the centerpiece, climbing on average about 90% annualized, driven by a differentiated collection—Micron MU, KLA KLA, and Intel INTC—that outperformed the index’s most heavily weighted chipmakers. An underweighting in software also helped.

Big bets on biotechnology, pharma, and semiconductors, which the fund has often favored, have long been important factors in its returns, and its shorter-term results often thrill or disappoint depending on biotech’s performance relative to the market. But the fund’s value-add has gone beyond its timely industry exposures: The team has also demonstrated skillful stock selection over the long haul, which is the more durable reason its decade-long record ranks near the top of the category.