Stocks could shed half their value next year, investor Dan Niles warns

Closely watched hedge fund manager Dan Niles sees cracks in the bull market.

Niles, founding partner at AlphaOne Capital Partners, believes stocks could shed as much as half their value next year.

“Late 2019, you’re really going to have to start to worry. And, why is that? Well, it’s because a lot of the themes that are really good right now, when you get a year from now, they are going to turn out to be really bad,” Niles said Tuesday on CNBC’s “Futures Now.” “That’s when the real problems are going to start where you have a 20 to 50 percent type of correction.”

He warns economic expansion is getting longer in the tooth — suggesting in a note to CNBC that the “relentless bull market” is breaking down. Niles, who made his name in the tech space, suspects the odds of a recession will rise dramatically late next year.

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