Stocks have run into a bit of trouble lately, as the is down 2.5 percent from the record high it hit on Sept. 19, and the CBOE Volatility Index (better known as the VIX) has gotten as high as 17. But Scott Clemons, chief investment strategist at Brown Brothers Harriman Private Bank, predicts that it will get much worse for stocks between now and the end of the year.
"I'm nervous," Clemons said Tuesday on CNBC's "Futures Now." "I think investors have had a holiday from volatility for almost two years, and that vacation's about over."
Because the markets have been so sanguine for so long, when the market does crack, the reaction could be swift and painful, he said.
"The complacency in the market, to me, is one of the things that creates a fragility that could lead to an enhanced or exaggerated negative market reaction, on even a modest piece of negative news."
And because of this nervousness, Clemons, whose firm manages $26.8 billion, has adopted a conservative market posture.
"We're pretty defensive in the way we're approaching the market between now and the end of the year," he said. "We've allowed cash in our portfolios to rise. ... We are happy to hold cash as dry powder in anticipation of taking advantage of that future volatility when it occurs."
Indeed, a bout of selling in the midst of a bull market could end up leading to some great opportunities for the tactical. As Clemons notes, "Volatility is the friend, not the enemy, of the patient investor."