It's a function of human nature that people prefer taking risk when they see others being rewarded for doing so. The behavior holds particularly true when it comes to the stock market.
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Stocks are about the only thing that people don't want to buy on sale," said Mark Cortazzo, certified financial planner and senior partner at MACRO Consulting Group. "Back in 2009, when the environment was a lot less risky than today, people didn't want to take risk. Now, when there's much more risk in the market, people want to take on more risk," he said. "It's counterintuitive."
And it is potentially catastrophic to your investment portfolio, financial advisors say.
With the S&P 500 index up more than 30 percent last year—having nearly tripled since bottoming out in May 2009—risk in the stock market has risen dramatically in the last five years. Plenty of individual investors, however, are eager to either get into the market—if they feel they've missed the boat—or let the good times roll despite the mounting risk of an arguably overdue correction in the market.
(Read more: Spoiled for investment choice? Less is much more)
"A market run like this is a bit like financial pornography. It's shiny and distracting," Cortazzo said.
"People might be able to achieve their wants by being more aggressive, but they also risk not being able to meet their financial needs," he added. "I try to put these things in perspective for them."