When it comes to selecting mutual funds, most investors have a simple formula: Find out which investments have done the best  in the past year and invest accordingly. Along the same lines, some figure out which fund managers have the greatest name recognition and star power and go with them. After all, if the everyday investor has actually heard of a manager, that means the manager must be good, right? Well, there may be something to following the big moneymaking names, but that doesn't always guarantee smooth sailing.

Going it alone
I certainly won't deny that the investing world has its share of superstar investors: Bill Gross, Bruce Berkowitz, and Warren Buffett immediately come to mind. And while there are plenty of successful mutual funds that are led by single star players, there is an inherent risk involved in investing in such a fund: What happens when the manager leaves or retires? For example, witness the upheaval at TCW Investments when manager Jeffrey Gundlach parted ways with the firm. Shareholders yanked billions of dollars from TCW's bond funds in the weeks following Gundlach's departure, and those who remained were left wondering if they should follow suit.

That's why I prefer team-based management structures. Such an approach reduces the risk that the fund will have to be discarded when a star manager flies the coop. And I certainly like the idea of having more than just one brain behind my investments!

I'm not recommending that anyone ditch their single-manager funds, but just be aware of the risks involved in this management structure. If you do own a fund run by a single manager, try to get an idea of how much they rely on a team of analysts or a firmwide investment committee. Some folks may depend pretty heavily on firm resources, while other managers are pretty much on their own when it comes to making portfolio decisions, as tends to be the case at many Fidelity funds. If managers can call their own shots, then the fund truly is only as good as the manager, and firmwide reputation and research doesn't really come into play.

Meanwhile, if you want to consider some top-notch team-based funds, here are two of my favorites:

Dodge & Cox Stock (DODGX)
Dodge & Cox is a prime example of team-focused investment done right. There are no superstar names here, so there's little cause for concern if any one team member heads for the door. Nine investment professionals make up the brain trust on this fund, five of whom have been on the job for at least 14 years. The fund invests in undervalued stocks with a healthy long-term growth outlook. Over the past decade and a half, the fund has racked up a 9.2% annualized gain, outpacing 97% of its large-value peers. With a low 18% annual turnover and very reasonable 0.52% price tag, this fund has a lot in its favor.

Right now, management is finding a lot of value in the health-care sector, which accounts for almost one-quarter of fund assets. According to management, while recently passed legislation may put pressure on pharmaceutical firms in the short run, it believes longer-term that great volumes will ultimately benefit this industry and spur them to cut costs and offer new products.

To benefit from this trend, the team owns European stocks Novartis, sanofi-aventis (NYSE: SNY), and GlaxoSmithKline (NYSE: GSK), as well as Merck and Pfizer (NYSE: PFE) closer to home. All of these pharmaceutical names trade at P/Es of 14 or less, making them a perfect fit for Dodge & Cox's value-oriented approach.

PRIMECAP Odyssey Growth (POGRX)
The folks over at PRIMECAP Management are another shining beacon of how teamwork can translate into handsome profits. This team also runs the exceptional Vanguard PRIMECAP (VPMCX), which ranks in the top 4% of all large-growth funds over the past 15 years. Unfortunately, the Vanguard fund has been closed to new investors for much of the past decade. But investors can get in on some of that PRIMECAP magic in the newer Odyssey Growth Fund, which has outpaced 92% of its competition in the past five years. Fast-growing names are the focus here, although valuations are considered as part of the equation.

Health care is an area of prime focus for this management team as well, accounting for nearly 38% of fund assets. Management has a long-term bullish outlook for the sector and believes that new products and services will result from the sector's meaningful research and development efforts. These new products will face large demand from a growing elderly population.

Biotechnology companies Immunogen (Nasdaq: IMGN) and Amgen (Nasdaq: AMGN) are two high-quality names with the innovative product lines that management likes to see. Also on board the portfolio are drugmaker Eli Lilly (NYSE: LLY) and medical device manufacturer Medtronic (NYSE: MDT), two more reasonably valued companies with expanding markets and strong balance sheets -- music to the ears of PRIMECAP's management team.

So when following the star of a well-known money manager, keep in mind that there are dozens of investment teams out there with just as much know-how and moneymaking ability as their more famous counterparts. These team members may not be big names on their own, but their combined abilities make them a force to be reckoned with.

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Amanda Kish is the Fool's resident fund advisor for the Rule Your Retirement investment newsletter. At the time of publication, she did not own any of the funds or companies mentioned herein. Novartis is a Motley Fool Global Gains selection. Pfizer is an Inside Value selection. The Fool owns shares of GlaxoSmithKline and Medtronic. The Fool has a disclosure policy.