Investors are being lulled into complacency by the current, extended period of low volatility that the markets are experiencing, says the founder of Summit Global Investments Inc. in Bountiful, Utah.

Instead of sitting back and expecting high returns to continue, investors and advisors should be prepared for a market correction that is likely to occur in the next six to 12 months, says David Harden.

Downturns frequently occur after a long period of low volatility like the market is now experiencing, warns Harden, chief investment office of Summit Global, a long-only investment firm with $800 million in assets under management.

First of all, Harden says, August is historically a bad month for the Dow and the S&P 500. Combine that with the fact that volatility has fallen to new lows that may not continue for much longer, and investors should be prudent now rather than jumping into what is now a good market, he says.

“In the past, when volatility has reached such lows, the volatility index has spiked up significantly in the next 12 months,” he says.

Secondly, the potential for increased volatility is exacerbated by the uncertainty now being imposed domestically by the White House and Congress, and internationally by unstable or threatening governments such as in North Korea.

Beyond the new Department of Labor fiduciary regulations that have financial firms on edge, one tweet from President Trump could affect how a company performs, and those tweets are unpredictable, Harden says.

“We are in the calm before the storm,” Harden maintains.

Summit Global invests with those risks in mind, hedging against market downturns rather than trying to exploit upturns, he says. Risk management and protecting capital are the primary goals at Summit Global, Harden adds.