New York - Jeffrey Gundlach, chief executive officer of DoubleLine Capital, said on Tuesday that there is “big money” to be made on the “short side” if equities fail to stay near current highs.

Gundlach, who oversees more than $100 billion at Los Angeles-based DoubleLine Capital, said on a webcast that he has been selectively betting against shares in the Standard & Poor’s 500 index and continues to favor emerging market bonds over high-yield “junk” debt. Gundlach, known on Wall Street as the “Bond King,” told Reuters after the webcast: “A minor new high in the S&P might be rejected, which is what happened with U.S. Treasuries.”

On Tuesday, the Dow Jones Industrial Average hit a record and the Nasdaq Composite Index turned positive for the year, the latest milestones in a rally that also carried the S&P 500 to a new high for the second day in a row, closing at 2152.14.

Gundlach had warned investors last week that the yield on the 10-year Treasury note at around 1.38 percent to 1.39 percent “is a terrible trade location. It is the worst trade location in the history of the 10-year Treasury.”... Read More: VIN