(Bloomberg News) Abby Joseph Cohen, the senior U.S. investment strategist at Goldman Sachs Group Inc., said investors are taking more risk by buying bonds at negative real yields than by putting money in equities as the economy grows.

"There are many investors who really are just so nervous about equities," she said in a radio interview today on "Bloomberg Surveillance" with Tom Keene and Ken Prewitt. "The long-term question is: Should they be more nervous about bonds right now? That to me is riskier than the stock market."

The Standard & Poor's 500 Index surged 29 percent through yesterday from its 2011 low in October as economic data beat economists' forecasts and Federal Reserve Chairman Ben S. Bernanke said he will keep interest rates low through at least late 2014 to spur growth. Ten-year Treasuries are yielding about 2.17 percent, less than the 2.90 percent year-over-year increase in American consumer prices in February.

The U.S. may be emerging as a main engine for global growth as Europe slides into recession and China's economy decelerates, with optimism measured by the Bloomberg Comfort Index near a four-year high. Personal-consumption expenditures rose by the most in seven months in February, the Commerce Department said last week, while data today showed orders to U.S. factories climbed in February for the third time in four months.

"One of the things we are seeing in the economy is that corporate spending on business equipment continues at a good pace, and critically, they are also now hiring new workers," Cohen said before the factory-orders report. Speaking during a separate interview on Bloomberg Television, she described U.S. economic growth as "good, solid, steady."

Equities may extend gains this year because of cheap valuations, fueled by a shift in risk aversion among investors, Cohen said.

"We are talking the S&P at 1,500 to 1,600," she replied when asked for a year-end forecast for the stock index. The benchmark measure of U.S. equities closed at 1,419.04 yesterday. David Kostin, the chief U.S. investment strategist at Goldman Sachs, has a year-end projection of 1,250, according to a weekly survey by Bloomberg News.