Druckenmiller Says He’s Short the Euro, Stocks Could Be Next

Stan Druckenmiller, who boasts one of the best investor track records over the past three decades, said he’s betting against the euro again and could see himself becoming bearish on stocks.

Druckenmiller, who produced average annual returns of 30 percent from 1986 through 2010 at his Duquesne Capital Management, said in April he was bearish on the euro. He covered that position later in the year.

“The nice thing about currency moves, they tend to last two or three years,” the investor said Tuesday at the New York Times DealBook Conference in New York. He added that the moves tend to take a “time out” somewhere in the middle.

The longtime hedge fund manager pointed to a divergence in monetary policy between the U.S. and Europe that started in May
2014. He said European Central Bank President Mario Draghi has “pretty much pre-announced step two,” signaling either a further cut in the discount rate, more quantitative easing or both, while “heavy breathing” at the Federal Reserve points toward a potential interest rate increase.

The 62-year-old investor was the architect of a $10 billion trade made in 1992 shorting the British pound while he was working for billionaire George Soros. The wager made $1 billion and earned his boss the moniker “The man who broke the Bank of England.”


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Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.