The market is at risk if Britain decides to leave the European Union, not necessarily because that nation is exiting but because others may follow, bond expert Bill Gross said Friday.
"France ... or Italy might suddenly decide their own domestic internal policies should be favored versus that of a larger EU family," Gross said in an interview with CNBC's "Power Lunch."
"If 'Brexit' wins, then fear gets into the marketplace and positions in terms of expectations for growth — anemic as it is in euroland — become threatened."
U.S. stocks fell in midday trading Friday after a new poll by London newspaper The Independent showed 55 percent of British citizens are in favor of leaving the EU. The vote is scheduled for June 23. The pound fell against the euro, as well as against the dollar.
Gross, who runs the $1.4 billion Janus Global Unconstrained Bond Fund, said the possibility of a Brexit is just another element that does not favor risk assets.
"Risk assets are dependent upon growth, they're dependent upon — even in the high-yield market — on relative stability and to the extent from a geopolitical standpoint that growth is threatened then risk assets are at risk," he said.
As one outcome becomes more probable than the other, then money is moved around quickly and causes volatility and instability, added Gross.