Optimism about stocks is not unrealistic: JP Morgan’s Mary Erdoes

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A man incarnating a ‘Toro de Fuego’ (bull of fire) chases people during the San Fermin Festival on July 8, 2017, in Pamplona, Spain.

J.P. Morgan Asset Management CEO Mary Erdoes on Friday gave a bullish case for stocks, saying optimism about the booming market isn’t impractical.

“Just because people are optimistic doesn’t mean their unrealistic,” Erdoes told “Squawk Box” from the World Economic Forum in Davos, Switzerland.

Erdoes spoke as U.S. stock futures were higher Friday morning, with the Dow, S&P 500 and Nasdaq on track for a fourth straight positive week.

The Dow and the S&P 500 haven’t had back-to-back losses so far in 2018, marking the longest such stretch in history at the beginning of a year.

Erdoes said the market has been strong for an extended period of time, so people are worried about a major pullback.

“We will have a 5 percent correction. That’s normal,” said Erdoes, who leads J.P. Morgan’s strategic partnership with Highbridge Capital Management and Gávea Investimentos.

On Tuesday from Davos, Bridgewater Associates founder Ray Dalio predicted investors will see “a market blowoff” rally, fueled by cash from banks, corporations and investors.

“If you’re holding cash, you’re going to feel pretty stupid,” the hedge fund billionaire said.