Andrew Krieger: the man who shorted an entire country
The 1987 legend who shorted the New Zealand dollar with a position bigger than the country's money supply — and what it really teaches about currency strength, liquidity and leverage.
JUL/12/2026 · 2 min read
In 1987, a 32-year-old trader built a position so large it was bigger than an entire country's money supply — and a central bank had to step in to stop him.
The setup
The week after Black Monday — 19 October 1987, when the Dow fell about 22% in a single day — markets were in chaos and every trader was hunting for the next domino to fall. Andrew "Andy" Krieger, a currency trader at Bankers Trust, found it in an unlikely place: the New Zealand dollar, the "kiwi."
While panic pushed money around the majors, Krieger judged the kiwi to be wildly overvalued for such a small, export-dependent economy. His bank had handed him an unusual amount of rope — a reported $700 million trading limit, far above his desk peers.
The trade
Krieger didn't just sell the kiwi. Using options to stack leverage estimated at 400:1, he built a short position reportedly larger than New Zealand's entire money supply. Within hours the NZD dropped around 5% against the dollar. The story goes that the Reserve Bank of New Zealand called Bankers Trust to ask what was going on — and ultimately had to intervene to steady its own currency.
The result: about $300 million in profit for the bank. Krieger's personal bonus? $3 million — which he reportedly considered an insult, roughly 1% of what he'd made. He resigned in 1988 and went to work for George Soros.
What it actually teaches
The Krieger legend is fun, but the lesson isn't "swing 400:1 and get rich." It's the opposite. Three things made that trade — and all three are things we obsess over here:
- Currency strength, not price. Krieger wasn't trading a chart; he was trading a currency he judged fundamentally overvalued. That's exactly the read our FOTSI currency-strength oscillator is built for.
- Liquidity. The kiwi moved so violently because it's thin. Understanding liquidity in forex is why the same headline barely nudges EUR/USD but whipsaws a minor.
- Leverage cuts both ways. 400:1 made Krieger famous; it also makes most retail accounts disappear. Before you copy the legend, read what leverage really does and how to size a position.
Krieger had a bank's balance sheet, a $700M limit, and a central bank as his counterparty. You have a retail account. Admire the story — then trade your own size.
Profile from ForexCommand, not financial advice. Figures are widely reported historical accounts.
