High yield bonds have been big winners this year thanks to the Federal Reserve's lower for longer interest rate policies. That outperformance has pushed the ProShares Short High Yield ETF (SJB) - Get Report down 13% thus far in 2016.

Michael Pento, president of Pento Portfolio Strategies, believes the turn is at hand and it's to take out the junk.

"The yield curve will flatten and then invert quickly now that U.S. growth is headed to zero and the Federal Reserve is recommencing its hiking cycle. An inverted yield curve is going to hammer high yield," said Pento.

And it's not just bonds where Pento sees bad times ahead. He is also bullish on the AdvisorShares Ranger Equity Bear ETF (HDGE) - Get Report , a fund which shorts select stocks that has dropped almost 10% this year as markets have climbed higher.

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"The stock market is overextended and overvalued," said Pento. "It's up 200% since 2009 even though we have seen five quarters in a row of negative earnings growth."

Pento added that the rising U.S. dollar and falling oil will all weigh heavily on stocks as well, especially small caps which he sees as the most vulnerable to a downturn in the economy. Pento is long the ProShares Short Russell 2000 ETF (RWM) - Get Report , even though it has dropped 11% year-to-date as the market's minnows have outperformed its whales.

Finally, Pento is positive on the ProShares Short MSCI Emerging Markets ETF (EUM) - Get Report , which has dropped 20% year-to-date as emerging markets have recovered thanks to stabilizing commodities and improving fundamentals.

Alas, the good times in emerging markets are over, according to Pento, and investors have the opportunity to profit from their forthcoming pain.

"The debt fueled bubble economy in China is teetering on a very narrow ledge," said Pento.