The mainstream financial media love to tell you, “Bull markets don’t die of old age”. True enough. Indeed, the current uptrend remains a shining example of cyclical durability and persistence.

For many, then, the fact that the stock bull has set an all-time record in length is cause for celebration. 3,453 days and counting. If you choose to listen, Kool & The Gang will even let you know where the party is at.

It is worth noting that the S&P 500 needs to close above its January 26 high of 2872.87 to keep the title of the “Longest Bull Market In History”. Otherwise, it may wind up finishing 2nd in the record books.

Technicality notwithstanding, U.S. stocks are still powering higher. They’ve made careful investors seem like out-of-touch fogeys. And they’ve made capital consciousness sinful.

It is true that I am one of those fogeys. Since the start of 2015, I have been more cautious. I have participated at a lower-than-typical allocation for my retiree and near-retiree client base (50%-60% rather than 65%-70%). Nevertheless, I have maintained the bulk of the risk-on allocation.

As a risk manager, I dedicate capital to stocks when the monthly close of the S&P 500 is above its 10-month simple moving average. I allocate less to stocks when the monthly close falls below the 10-month moving average. This discipline made it possible for me to minimize the severity of the 2000-2002 tech wreck as well as the 2008-2009 financial crisis.

With the trend so favorable, why have I chosen to take any chips off of the proverbial table? After all, returns could lag for years.

One factor is the longer-term outcome(s) when paying an extraordinary price premium. For example, since 2015, the S&P 500’s P/E has regularly situated itself in the most expensive decile of valuation. Forward return prospects are poor when accounting for the risk one is taking at the highest decile(s).