This 30-year market veteran is alarmed by a record-chasing S&P 500. Here’s where he’s investing instead.

A 30-year market veteran is voicing concern that investors are chasing record highs in the S&P 500 while overlooking what he considers a safer alternative. Steven Jon Kaplan describes the current stock market as "completely irrational," suggesting that enthusiasm for equities may be running ahead of underlying fundamentals.

For everyday investors, the takeaway isn't a signal to buy or sell — it's a reminder that record-setting indexes can reflect momentum as much as value. When valuations stretch, the margin of safety built into stock prices narrows, and the potential downside from any disappointment grows. That dynamic is what long-tenured market watchers tend to flag when sentiment turns euphoric.

What to watch: whether earnings growth actually justifies current index levels, how interest rates and inflation data shift the appeal of alternatives to stocks, and whether volatility stays unusually low. None of this predicts a downturn. It simply illustrates why some experienced investors rotate toward more conservative positioning when markets look priced for perfection — and why diversification remains a core principle rather than a reaction to headlines.