Investing guru Byron Wien warns savvy investors that it is only a matter of time before the seemingly endless bull run will finally hit a dead end on Wall Street.
"A 10 percent correction could come along at any time, and particularly when the market has done as well as it's done. I mean basically it's gone straight up since Donald Trump was elected," Wien recently told CNBC.
A "correction" is commonly defined as a temporary drop of at least 10 percent adjust for an overvaluation.
The three major U.S. indexes rose in late morning trading on Thursday with stocks of technology companies leading the pack, followed by industrials. The Dow Jones Industrial Average was up 47.78 points, or 0.2 percent, at 24,188.69 and the S&P 500 was up 6.3 points, or 0.24 percent, at 2,635.57. The Nasdaq Composite was up 45.12 points, or 0.67 percent, at 6,821.50.
Wien, vice chairman of Blackstone's Private Wealth Solutions group, gives a 50 percent probability for a deep sell-off by year-end, CNBC explained.
"The market is overbought and investors are optimistic," said Wien. "An overbought market with optimistic investors is vulnerable, and the question is what triggers the vulnerability?"
He also said the market could just pause on its own and not hit a prolonged slide.
"Maybe the market just spontaneously begins to fade," added Wien, who believes the markets are already borrowing performance from 2018.
He believes stocks would bounce back quickly from any dip.
"Fundamentals are very strong," Wien said.
Strong earnings and solid economic growth have pushed stocks to record levels this year and Republican efforts to cut corporate taxes have added to the momentum, Reuters explained.
The Senate Republicans on Wednesday agreed to talks with the House of Representatives on the tax bill amid early signs that lawmakers could agree on a final bill ahead of a self-imposed Dec. 22 deadline.
However, a gridlock between President Donald Trump and Congress over the passage of spending legislation before Friday has raised fears of partial shut down of the federal government.
(Newsmax wire services contributed to this report).