The Federal Reserve's near-zero interest rate policy has created an environment where U.S. stocks are the best option for investors, Omega Advisors CEO Leon Cooperman told CNBC.

"The [Fed] has created an environment where there is no effective alternative to stocks," he noted.

"I could keep [money] in cash and that's zero, and the Fed has told us that it's going to be zero for a couple of more years," Cooperman said.

Editor's Note: This Wasn’t an Accident — Experts Testify on Financial Meltdown

Investing in U.S. government bonds is not worthwhile, he added, calling the 1.8 percent yield on the 10-year note "ridiculous."

"Adjusted for taxes and inflation, you're getting a negative return," he stated.

With regard to bonds, he said he believes there will be significant negative returns during the next three or four years.

Cooperman paints himself as a “buffalo” versus a bull or a bear, suggesting the stock market could go up or down by 10 percent.

"More likely up than down because of the economy and because of the Fed," he commented.

He remains bullish on stocks, though, even with the looming fiscal cliff of spending cuts and automatic tax increases. Moreover, he does not believe a recession will occur in 2013 but if it does, it would be "accelerated inflation that forces Fed tightening," according to gurufocus.com.

Cooperman's Omega Advisors fund is up 30 percent so far this year, while the hedge fund industry as a whole is only up about 5.7 percent.

Editor's Note: This Wasn’t an Accident — Experts Testify on Financial Meltdown