Druckenmiller's $5.5B British Pound Bet Pays Off Big

Ambitious investor Stanley Druckenmiller made a bold move in 1992 when he informed his boss, George Soros, that he would sell $5.5 billion worth of British pounds and buy deutschemarks.

The idea was that the Bank of England's attempt to maintain an unsustainable exchange-rate peg could lead to its collapse, causing the pound to depreciate and resulting in a huge profit for Quantum hedge fund.

Druckenmiller's plan would ultimately prove correct, as the BOE abandoned its efforts to sustain the peg, allowing the British pound to float and eventually decline against the deutschemark.