"It could be a deep correction," in the words of Daniel Pinto, an executive at Action Alerts Plus holding JPMorgan Chase & Co (JPM) .

The markets have been on edge over the last six weeks or so. After a strong start to 2018, concerns have bounced between volatility funds, to inflation, to the 10-year yield. Most recently, investors grew concerned after Gary Cohn, chief economic advisor to President Trump, resigned from his position late Tuesday.

But despite all of these concerns, the S&P 500 is currently down just 5% from its all-time highs. Imagine what another 15% or so would feel like. Or worse, another 30%. 

According to Pinto, the decline could be somewhere in the 20% to 40% range. And for those not familiar with Pinto, he's no fool, serving as the CEO of J.P. Morgan's Corporate & Investment Bank. Right now there's a concoction of concerns, between the Fed, inflation and tariffs, he said. 

However, this tumble might not happen for another two or three years, Pinto argues. The size of the fall will depend on the market's current valuation, he added.

So it's possible that if the markets continue to rally over the next few years before seeing a 20% correction or more, stocks could be right back to current levels -- or even above them. While that doesn't sound all that bad, it is tough work to sit through a big decline without feelings of worry. 

JPMorgan CEO Jamie Dimon said it's unlikely the U.S. will have a recession in 2018. However, he questioned whether one could develop in 2019 and suggested the recent tariff proposals out of Washington will be a negative for growth.

Cohn, formerly with Action Alerts Plus holding Goldman Sachs Group Inc.  (GS) before taking his position at the White House, was not in support of the tariff either, and it's what ultimately put him over the edge on his way to resigning. 

Pinto's forecast is rather vague, but a 20% fall would startle most investors -- even if it comes three years from now.

A 40% fall will downright terrify investors.

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This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.

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