June marks the 100th month we’ve published the Powerfund Portfolios newsletter, and to mark the occasion, we’re making some executive changes to our model portfolios. We’ll be reducing the number of model portfolios and (eventually) moving to daily performance updates.

May was the first truly bad month for stocks and higher-risk bonds since the great comeback that started a little over a year ago. The only fund categories that were up, besides funds that short, were municipal bond funds and federal government bond funds. Funny how whenever there is a global panic of any size investors pile into what is supposedly the root of all evil in the economy, fiscally irresponsible governments.

In recent commentary we noted pending trades to move us away from higher risk, cyclical bond and stock categories and towards lower default risk bonds and less cyclical stock fund categories. We want to be in fund categories that other investors are avoiding. During the last hurrah of this market comeback, investors are piling back into foreign markets, junk bonds, small cap, natural resource and commodities, and the like.

While the ten-year return is still slightly negative, over the last 12-months the S&P 500 was up just under 39%. The 70% run-up from the lows of early March are fueling optimism. Just not around here. We’re planning on slimming down our stock stakes soon. As dyed in the wool contrarians, we prefer when stocks seem to have nowhere to go but down.