Record Stock Highs a Risk for 2012 Market Leaders

NEW YORK (TheStreet) - It's no surprise that Warren Buffett's investing conglomerate Berkshire Hathaway(BRK.A) is testing new highs just as the Dow Jones Industrial Average and S&P 500 rise to new records.

After all, with businesses spanning energy, industrials, infrastructure, financial services, media, retail and housing, Berkshire Hathaway is seen as a snapshot of Corporate America.

In the financial crisis, Buffett made a big bet on a U.S. economic rebound by way of acquisitions such Burlington Northern Santa Fe and an investment portfolio weighted heavily in financials such as Wells Fargo(WFC) -- a move that appears to be paying off in tandem with rising markets.

Berkshire Hathaway's stock performance and the conglomerate's linkage to a recovering U.S. economy certainly is something for Buffett to cheer.

So why does he seem so glum?

The answer may tell a story beyond Berkshire's earnings and an almost daily occurrence of new stock market highs.

Notably, if markets continue to rise, Buffett is bracing for Berkshire Hathaway to underperform overall indices starting in 2013.

For investors in strong-performing large caps across many sectors, dissapointment may already be sinking in.

Consider that some of Berkshire's top holdings, such as Coca-Cola(KO) and IBM(IBM) , sit slightly below record highs in 2012, amid their continued share price recovery and payoff to investors like Buffett. Were markets to drive higher this year, the likes of IBM and Coca-Cola may soon see one-year stock returns fall well below the S&P 500.

As it turns out, holdings in Buffett's stock portfolio aren't alone in risking underperformance after reaching record highs in 2012, well ahead of overall indices.

Starbucks(SBUX) , which hit a record high of $62 a share in April of 2012, sits nearly 10% below those highs. As 2013 progresses, the coffee roaster's one-year stock returns may turn from being a market leader to a laggard, falling behind the overall S&P 500.