Given that an estimated $5.1 trillion is traded every single day on the Forex market. It’s little wonder that it’s home to some of the richest and most successful investors of all time.
This is central to the unique appeal of the Forex market, through which currency is traded as a derivative that can deliver significant, margin-based gains to traders. It also creates the opportunity to short-sell (we’ll have more on this later) and profit in a depreciating marketplace, so long as traders understand the marketplace and its underlying laws.
In this post, we’ll look at three of the most Forex traders of all-time, whilst asking which strategies and attributes underpinned their achievements.
Somewhat inexplicably, George Soros has become a controversial political figure in the eyes of some, thanks largely to the false perception that he continues to push for open borders and fund the movement of migrants across the globe.
Prior to this, however, Soros earned repute as a man who made millions from the Forex market, particularly in 1992 when he hedged against the pound and reportedly ‘broke the Bank of England’.
In short, he netted a staggering $1 billion after short-selling $10 billion in pound sterling (GBP), following UK’s withdrawal from the failing European Exchange Rate Mechanism.
This reflected Soros’ impeccable sense of determinism and financial ruthlessness, which he leveraged by selling the GBP in bulk and capitalising on the subsequent market movements. Incredibly, this was achieved in the days before online trading platforms, and this respect Soros’ success also underlines the importance of research and market knowledge.
Next up is American Stanley Druckenmiller, who started his career as a management trainee at the Pittsburgh bank before evolving to manage funds for Soros between 1988 and 2000.
Interestingly, the Philadelphia-born Druckenmiller also participated in the notorious Bank of England trade, helping him to earn huge profits and launch his career into the stratosphere.
This success certainly stood the U.S. citizen in good stead when the financial crisis swung around in 2008, as he was able to plot a course through this and even profit from the ensuring disruption.
Once again, this was underpinned by a keen sense of determinism and a lack of emotive trading, whilst Druckenmiller’s success also supports the importance learning from the very best.
Next up is Andrew Krieger, who joined the Banker’s Trust in 1986 and quickly earned an increased capital limit of $700 million based on his success and track-record.
Having profiting from the financial market ‘Black Monday’ crash on October 19th, 1987, he’s yet another trader who has showcased tremendous determinism and resilience during his stellar career.
Krieger has also based much of his success on the New Zealand Dollar (NZD), which he believed remains vulnerable to short-selling as part of a worldwide panic during times of economic tumult.
This betrays a detailed knowledge of the Forex market, and how individual currency pairings react to specific economic trends and events.