Learning from the experience of George Soros

<!– /* Style Definitions */ p.MsoNormal, li.MsoNormal, div.MsoNormal {mso-style-parent:”"; margin:0in; margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:12.0pt; font-family:”Times New Roman”; mso-fareast-font-family:”Times New Roman”;} p {mso-margin-top-alt:auto; margin-right:0in; mso-margin-bottom-alt:auto; margin-left:0in; mso-pagination:widow-orphan; font-size:12.0pt; font-family:”Times New Roman”; mso-fareast-font-family:”Times New Roman”;} @page Section1 {size:8.5in 11.0in; margin:1.0in 1.25in 1.0in 1.25in; mso-header-margin:.5in; mso-footer-margin:.5in; mso-paper-source:0;} div.Section1 {page:Section1;} –> Have you ever heard some thing about George Soros ever in your life? If you don’t know him, then you need to be told that he was the legendary manager of Quantum Hedge Fund and he was the great person who had made a very cool and a lump sum amount of money that is $1 Billion and he had made this big profit from a single bet only. In the days of early 1990s, he was working in his office and side by side he was discussing currency markets and their trends etc with one of his associate. Both of them were having the same sort of opinion that the pound of Britain is being overpriced and they were thinking that because of the increase in price of pound Bank of England would not be able to sustain its price for a long period of time.

And at that particular moment only He decided that he is going to purchase $10 Billion of trading puts and options of calls by making use of all his funds and assets as collateral. George Soros was really very excited and he was willing to gamble everything that he possesses on a single bet only. At that time most of the people thought that he is being mad. Many people came to him and tried hard to make him understand that he should not put all his money in a single bet. But he was much firmed about his decision.

Actually the best part was that he was having all the relevant amount of knowledge about trading in the currency markets. He was perfect in making his trading decisions. He was very much sure that his conviction about the Bank of England will turn up true. He was very much firm in saying that Bank of England will not be able to sustain the overpriced British pound would come off right one day or another. Soon all the speculators of other currency also joined this big game of trading. After all this there was a huge amount of selling pressure that was developed on the British pound. And because of this huge pressure Bank of England could not sustain the selling pressure for too long and only in the duration of 24 hours they had to take their currency that is British pound out of the trading System of European Monetary and they were not left with any other option other than letting it float freely.

After all this the monetary value of British pound was badly plunged. Gamble that George Soros played paid him off. After a single bet only he became very much popular. And now He is famously known as the Man who broke the Bank of England.