There is no introduction needed for an investment legend like Soros. And if you haven’t heard of him then you’re missing out valuable insights and wisdom. The man, the legend, George Soros is famously known as “The Man Who Broke the Bank of England.” He skyrocketed to fame in September of 1992 when he wagered $10 billion on a single bet against the British pound. This single cash hypothesis got the speculator an amount of $1 billion in benefits in a single day and a sum of about $2 billion over time. In this article, we will discuss his ideology and strategy which sets him apart from the crowd.
Soros Trading Philosophy:
Soros mainly operates as a short-term speculator. He would make massive and highly leveraged bets on the direction of the market. His famous hedge fund is known for its global micro strategy, a philosophy focused on making massive one-way bets on the movement and flow of the currency rates, commodity prices and other assets based on microeconomics analysis. Using this philosophy he was able to make his way to the hall of fame with his 1992 bet against the English pound and making a Billion in a single day.
To put it simply, Soros bets on the value of those investments which will either rise or fall. To follow his tactics, it takes through a study of the market and the targets. Soros refers to his philosophy of trading as Reflexivity.
Can investors learn “The Soros Way”:
Trading like George Soros is not for the timid or light of wallet. The downside of betting big and winning big is betting big and losing big. If you can’t afford to take the loss, you can’t afford to bet like Soros. It takes moxie and self-confidence to trade in his fashion. Once Soros has made up his made regarding an investment then there is no going back. Sure, it does cause him major downfall if the market acts otherwise to his trade.
Let’s check out his best and worst trade:-
Best Investment– In 1992, George Soros wagered $10 billion against the currency policy of the Bank of England, and its underlying currency, the pound. A bet that went down in history as the day George Soros broke the Bank of England by making $1 billion in a single day.
Worst Investment– This living legend didn’t simply achieve accomplishment without confronting affliction. On March of 2008, Soros purchased a huge chunk of Bear Stearns’ stock valued at $54 per share but a few days later the fabled Wall Street investment firm was sold to J.P. Morgan at $2 per share. Soros learned a lesson but in an expensive way.
Whether or not you ought to follow Soros’ strategy depends on your personality, how much time you want to commit, and how much you want to risk. But either way, there’s a great deal to learn from someone this experienced. Whatever way you choose to follow, you should be confident and patient with it.