NOTE: this was a past issue of my weekly newsletter, Timeless Gems. Join my free mailing list so you don’t miss out on future issues.
Today’s gem is this anecdote where Stanley Druckenmiller recalls his GBP short pitch to George Soros:
For those unfamiliar, Soros/Druck famously shorted the British Pound and “Broke The Bank of England” in 1992, walking away with ~$1.1bn of profit on this single trade.
When you hold such a high conviction in a bet, you stand to lose more money by betting less. Yes, I know, 200% of a fund in a single trade seems ludicrous, and perhaps a bit of survivorship bias here. But I still admire the conviction and the sheer audacity of the move.
Those that have been following my blog know that my general philosophy is to concentrate your portfolio in your best ideas. Great opportunities are rare, so when you do happen to stumble upon one – bet in size.
Shoutout to this Twitter account for resurfacing this anecdote!