There are plenty of reasons to be worried about the stock market's rampant rise, but there aren't any better alternatives, says Russ Koesterich, chief investment strategist at BlackRock.

"If someone asked me, how would I describe my position going into 2014, I'd say that I'm a nervous long," he told CNBC.

"I think that people should be a little bit more nervous. It's good to have that fear, because the reality is that we've had big gains, and those gains were mostly predicated on multiple expansion."

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For example, the cyclically adjusted price-earnings ratio developed by Robert Shiller, which includes 10 years of earnings, stands at 25.1, compared with an average of 16.5 going back to the 19th century.

As for next year, "you are going to have an environment where volatility is higher," Koesterich predicted. "I don't think it's going to be as easy just buying the U.S. market and going to sleep, and I think we are going to see differentiation between the different parts of the market."

But bonds and cash don't offer anything better, he noted. "We still think that stocks look attractive relative to the alternatives."

Noble laureate economist Shiller sees some signs of froth in the stock market, but not hugely so.

"It has bubble elements to it, because people see the market going up, and they're regretting the fact that they didn't buy in several years ago. They are tempted back into it," he told PBS NewsHour.

"But it isn't the really strong bubble that we saw before, because there are so many clouds. There are so many issues on people's minds that it doesn't look like the chance of a lifetime now."

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