Three Contrarians Share Their Secrets

On the fourth floor of a plain, Pasadena (Calif.) office building, behind a set of fake-wood-veneer doors, you'll find three of the world's most accomplished investors. They manage more than $25 billion, much of it for one of the nation's most popular 401(k) options. But chances are you've never heard of Primecap Management, much less its three chief stock-pickers, Howard Schow, Theo Kolokotrones, and Joel Fried.

That's how they like it. Staying quiet helps Primecap keep some of its best ideas close--stocks such as Ortel, a little-known maker of lasers and optical gear. Primecap first bought it in April, 1998. When it sank to 6 last spring, the firm got more. Since Lucent Technologies agreed in February to buy Ortel, the stock has topped 189. Primecap's average cost: 12.