Top 10 Funds That Aren't in Your 401(k)

The 10 best performing equity mutual funds in July are not likely to be offerings in your 401k plan. Most companies limit the number of fund choices available to employees by excluding most narrowly focused sector funds.

If you find it impossible to adequately diversify the investments within your 401k, remember that the goal is to diversify your whole retirement nest egg. So, if you opt for broad-based growth funds in the 401k, then as a small part of an overall diversified retirement portfolio riskier sector funds may be considered for your Rollover IRA, Roth IRA or regular individual retirement accounts.

A sector rotation strategy attempts to find the few sectors outperforming the overall market and shifts money into funds holding those companies. Five of the 10 best performing funds in July were targeting the biotechnology sector. ...