The market's recent volatility has given us all some thrills and spills lately, but let's face facts: Though there have been occasional pullbacks, we've essentially been on an upward trajectory ever since the fourth quarter of 2002.

Which raises this question: Is the market priced for perfection?

Could be, yes
By historical standards, we've enjoyed a lengthy bull run, and spendthrift stock shoppers will find no shortage of pricey equities. (NASDAQ:AMZN) and Sprint Nextel (NYSE:S), for example, sport price-to-earnings (P/E) ratios over 90 while Abbott Laboratories (NYSE:ABT) and Network Appliance (NASDAQ:NTAP) clock in at more than 35. Meanwhile, even such "value" stocks as Occidental Petroleum (NYSE:OXY), Washington Mutual (NYSE:WM), and Countrywide Financial (NYSE:CFC) currently trade with P/Es higher than their five-year averages.

The bottom line: If the market hits the skids again, puffed-up multiples could deflate in a hurry.

How to proceed?
The good news is, you have compelling options when it comes to insulating your portfolio: top-shelf mutual funds. If you want to maintain exposure to the market while taking on less risk than you'd have with a stocks-only lineup, funds are an intelligent choice -- provided you choose them intelligently.

For my money, "intelligent" funds are those with managers who have been in place for at least five years, and preferably longer. Tenure is a key metric for savvy fund shoppers who know there's nothing inherently magical about a mutual fund: It can only be as strong as the stock picker calling the shots now. That's why past performance, on its own, is woefully overrated: If a fund's eye-popping historical returns don't belong to its current leader, they're next to useless when it comes to gauging the fund's forward-looking prospects.

Indeed, it's better by far to focus on such things as fees, strategy, and whether managers puts their money where their mouths are by investing their own moola alongside that of their shareholders.

The Foolish bottom line
We consider all the above and more at the Fool's Champion Funds investing service, doing the legwork for our members by zeroing in on just those funds worth considering for their portfolios. And so far so good, too: Since opening for business more than three years ago, all of our recommendations have made money for shareholders, and as a group, they're besting the market by a double-digit margin.

If you're looking to reduce risk and would like to save time by zeroing in on the cream of the fund industry's crop, consider taking Champion Funds for a risk-free spin by clicking here. In addition to our complete list of recommendations, you'll also have access to our model portfolios, members-only boards, and every column inch of advice we're served up since day one.

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This article was originally published on April 17, 2007. It has been updated.

Shannon Zimmerman runs point on the Fool's Champion Funds newsletter service and co-advises Motley Fool Green Light with his pal Dayana Yochim. At the time of publication, he didn't own any of the securities mentioned above. is a Motley Fool Stock Advisor recommendation. Washington Mutual is an Income Investor pick. You can check out the Fool's strict disclosure policy by clicking right here.