Investing superstar Bruce Berkowitz has attracted a lot of attention, and money, with his record-topping Fairholme Fund (FUND: FAIRX). This large-cap winner ranks in the top 1% of its peer group over the most recent five- and 10-year trailing time periods. Berkowitz was also recently crowned Morningstar's Fund Manager of the Decade for the domestic equity category. Fairholme shareholders have certainly benefitted from Berkowitz's stewardship, and soon there will be yet another opportunity for Berkowitz to manage your money.

A new offering
Berkowitz's Fairholme Capital recently announced that it will be launching a new mutual fund, the Fairholme Allocation Fund. Here, Berkowitz will invest in a combination of stocks, bonds, and cash with no limitations on market capitalization, sector, or credit quality. According to Morningstar, Berkowitz is starting the fund to give himself more ability to invest in special situations and smaller companies that wouldn't have a big enough impact on returns for the larger Fairholme Fund, with its more than $16 billion in assets.

While I'm confident that the new Allocation Fund will do well, thanks to Berkowitz's well-proven abilities, I'd like to see how the new fund looks before making a final judgment. I'm guessing that this new charge will be a tad bit riskier than the original Fairholme Fund. I imagine we'll see concentrated sector positions, riskier fixed income plays, and perhaps higher turnover in the Allocation Fund.

Of course, Fairholme itself has been amping up the risk in recent quarters, as Berkowitz makes a big bet on beaten-down financials. The portfolio has allocated roughly 59% of assets to AIG (NYSE: AIG), Citigroup (NYSE: C), Bank of America (NYSE: BAC), and other financial sector stocks. Berkowitz sees ample opportunity over the long run here, believing these firms to be undervalued in the marketplace. He discounts the possibility of a double-dip recession, and thinks that troubled financials like these will rise from the ashes as the economy slowly recovers, eventually creating value for shareholders.

Berkowitz's current leanings should give us some indication of how his new fund will operate: by taking heavier bets on areas of perceived opportunity, and being willing to crank up the risk to hit that big payoff.

Room to run
Whether this fund is right for you will also depend on how much leeway you like to give your investment manager. If you're looking for a fund that allows for opportunistic investing and gives its manager lots of room to roam, Fairholme Allocation will probably fit the bill. However, if you're looking for a more stable, predictable fund that sticks to its corner of the style box, you might want to look elsewhere. Current Fairholme shareholders can also probably pass here. Investors shouldn't own more than one Fairholme fund for diversification reasons, so you might want to decide which of the shop's soon-to-be three funds is most appropriate for you, and stick with that one.

Ultimately, if Berkowitz's track record is any indication, the new Fairholme Allocation fund should do well over the long term, although investors should probably be prepared for some hefty volatility along the way. And remember, even a guru like Berkowitz will stumble at some point, so don't head for the door the minute his bets turn against him. Sticking it out for the long run is the best way to benefit from any proven guru's stock-picking abilities.

For more winning mutual fund recommendations and time-tested personal financial planning advice, check out the Fool's Rule Your Retirement service. You can start your free 30-day trial today.

Amanda Kish is the Fool's resident fund advisor for the Rule Your Retirement investment newsletter. Amanda owns shares of Fairholme. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.