If Donald Trump wins the election, kiss your 401(k) goodbye.
That's the prediction of the world's largest hedge fund.
On Tuesday, Bridgewater Associates sent out a note to its clients predicting that the Dow Jones Industrial Average could plunge nearly 2,000 points in one day if Trump is elected president. That would be the biggest one-day slump in stock market history, by more than double, besting the 777 point plunge that happened on October 29, 2008, at the high of the panic surrounding the financial crisis. The drop would translate into a 10.4% dive, and immediately send the stock market into correction territory.
That would erase nearly $1.9 trillion in value from U.S. stock market portfolios.
And it's not just U.S. stocks that would collapse. Investment around the rest of the world would crumble as well, according to Bridgewater. The hedge fund predicted that both China and European stock markets could drop by roughly 11% as well.
The Bridgewater note, which was first reported by Business Insider, was written by the firm's co-chief investment officers Greg Jensen, Jason Rotenberg and Jeff Amato.
Bridgewater said it wasn't taking a position on the election. Nonetheless, the hedge fund said the stock market was likely to rise 2.3%, or nearly 400 points, if Hillary Clinton wins the election.
Bridgewater didn't say why it thought a Trump presidency would lead to such a big drop in the stock market. Trump has said he would cut taxes, which could be good for the stock market. But others have argued that is harder to predict the policies a President Trump would put in place and investors don't tend to like uncertainty. Citigroup has also predicted that the stock market will drop big if Trump wins the election.
Moody's economist Mark Zandi, who has been a big supporter of President Obama, as well as John McCain, has said he thinks Trump's economic policies would lead to a recession.