Andrew Krieger is a legendary American currency trader. He became famous for one of the most aggressive and successful trades in history. In 1987, just after the “Black Monday” stock market crash, Krieger shorted the New Zealand dollar. This single, high-conviction move reportedly earned his bank, Bankers Trust, around $300 million. Krieger’s story is a powerful case study in macro analysis, courage, and the immense power of leverage.
This article will explore his biography, the legendary “Kiwi” short, and the timeless lessons his career still offers traders today.
Key Takeaways
- A highly successful currency trader at Bankers Trust, known as Andy Krieger to colleagues.
- He is famous for his massive 1987 short position against the New Zealand dollar (NZD), earning a reported $300 million.
- Krieger used bold, high-conviction macro analysis combined with extremely high leverage (reportedly 400:1).
- His career highlights the importance of acting decisively when in-depth analysis reveals a clear, overvalued market opportunity.
- The trade serves as a major case study on the extreme power (both for profit and loss) of using high leverage.
1. Who Is Andrew Krieger?
Andrew Krieger is a legendary American currency trader who gained significant fame in the late 1980s while working at Bankers Trust. He is universally known for one spectacular trade: a massive short position against the New Zealand dollar (NZD) in 1987 (PriceActionNinja, n.d.).
At only 32 years old, Krieger was already a highly successful trader for the bank. His deep market analysis led him to take an aggressive position so large it reportedly exceeded New Zealand’s entire money supply at the time.
The trade was immensely profitable, earning the bank a reported $300 million and cementing Krieger’s reputation (Business & Leadership, 2023). This event, which caused a sharp drop in the NZD, earned him the memorable nickname “The Kiwi Killer.”
2. Andrew Krieger’s Biography
Andrew Krieger (born in 1956) built a strong foundation for his financial career. He graduated from the prestigious Wharton School of Business at the University of Pennsylvania, a top Wharton MBA program, which equipped him with a deep understanding of economics and finance.
Before his famous tenure at Bankers Trust, Krieger worked at Salomon Brothers. He moved to Bankers Trust in 1986 and quickly became a star trader in the bank’s currency department. He was known for his bold, deeply analytical global macro trading style and his willingness to take large, high-conviction positions.
After his legendary NZD trade in 1987, Krieger’s reputation was solidified. He left Bankers Trust shortly thereafter and was hired by George Soros to work at Soros Fund Management, reinforcing his status as one of the top macro traders of that era.
3. What Is Andrew Krieger Also Known As?
Andrew Krieger earned several nicknames during his high-profile trading career, reflecting both his famous trades and his personality.
- “The Kiwi Killer” This is his most famous nickname. It was given to him by the press after his massive 1987 short trade against the NZD, which is also known as the “Kiwi.” The trade was so large that it put significant downward pressure on the currency, making him known as the trader who “killed” (or at least severely wounded) the Kiwi.
- “The Quiet Genius” While his trades were aggressive, Andy Krieger himself was often described by colleagues as quiet, disciplined, and intensely intelligent. This nickname reflects his personality: a calm, analytical trader who relied on deep research and logic rather than loud emotion or impulsive actions.
4. The Trade That Shook New Zealand (1987)
The one trade that made Andrew Krieger a legend occurred in 1987. It was a massive, high-conviction bet against New Zealand’s currency, the “Kiwi.”
4.1. Market Context – After Black Monday
The trade took place just after the “Black Monday” stock market crash in October 1987. Global markets were in panic mode. Investors fled to safety, causing capital to flood into safe-haven assets like the U.S. Dollar.
In this environment of fear, many small currencies were sold off. However, the NZD remained unusually high, propped up by the country’s high-interest rates. Krieger identified this as a major imbalance.
4.2. Krieger’s Analysis
Krieger analyzed the situation and concluded the NZD was fundamentally overvalued, perhaps by as much as 20%. He believed the currency was vulnerable and had not yet corrected to reflect the new “risk-off” reality of the post-crash world. His currency models and capital flow analysis suggested a sharp reversal was imminent.
4.3. The Execution
Using his position and significant trading capital at Bankers Trust, Krieger took an incredibly aggressive stance. He reportedly used 400:1 leverage, largely through currency options, to establish a massive short position against the NZD.
The size of this position was estimated to be worth hundreds of millions of dollars, a sum so large it allegedly exceeded New Zealand’s entire money supply at the time. This massive, concentrated selling pressure completely overwhelmed the market. The NZD collapsed by approximately 5% in a matter of hours.
4.4. The Aftermath
The result of the trade was a staggering profit for Bankers Trust, reported to be around $300 million.
The New Zealand government was outraged and publicly criticized the trade, accusing the bank of destabilizing its currency. Following this legendary trade, Andrew Krieger left Bankers Trust, reportedly due to a dispute over his bonus payment for the historic profit.
5. Prominent Achievements of Andrew Krieger
Andrew Krieger’s 1987 trade cemented his status as one of the most successful currency traders in history. His achievements are still widely discussed in trading circles.
- Massive profitability: He executed one of the single most profitable Forex trades on record. The $300 million gain from the NZD short remains legendary.
- Joining Soros Fund Management: Following his departure from Bankers Trust, Krieger’s talent was sought by other legends. He accepted an offer to work for George Soros, further validating his expertise as a top-tier macro trader.
- Featured in “The New Market Wizards”: Krieger’s story and mindset were later documented by Jack Schwager in the famous book, “The New Market Wizards.” Being featured in this collection placed him in the pantheon of trading greats, and his interview is still studied by traders today.
6. Krieger’s Trading Strategy Explained
Andrew Krieger‘s legendary NZD trade was not a random gamble; it was the result of a specific trading style and mindset. His approach combined deep fundamental analysis with bold execution.
6.1. Macro-Fundamental Focus
Krieger was a global macro trader. He didn’t focus on small, short-term chart patterns. Instead, he analyzed the “big picture,” looking at factors like global capital flows, interest rate differentials, and relative currency strength to find major economic imbalances suitable for large speculative positions.
6.2. Strategic Use of Leverage
The 400:1 leverage is a key part of his story. However, Krieger didn’t use it recklessly. His philosophy was to use high leverage only when his analysis provided extreme conviction and the probability of success was overwhelmingly high. It was not “gambling leverage” but rather a calculated, aggressive exposure designed to maximize the profit from a rare, high-certainty event.
6.3. A Contrarian Mindset
Krieger demonstrated a classic contrarian mindset. He was willing to bet against the prevailing market trend when he believed the market was being irrational. While others saw the NZD as stable due to high interest rates, he saw it as a vulnerable outlier in a post-crash world. He confidently took the opposite side of the majority, shorting the currency when many still saw it as strong.
6.4. Psychological Discipline
Executing such a massive trade required immense psychological discipline and control over market psychology. Krieger had to trust his data and analysis completely, even when initiating a position of that size. He was known for being calm and analytical, relying on his models and data-driven insights rather than succumbing to the widespread market fear and panic that defined the 1987 crash.
7. Andrew Krieger’s Key Insights
Andrew Krieger’s career and famous trade provide several powerful insights for modern traders. His philosophy wasn’t just about being aggressive; it was about being right and then acting on it with conviction.
Here are some of the core principles derived from his approach:
- “Leverage is only dangerous when you don’t understand the risk.” This insight frames leverage as a tool. In Krieger’s view, the danger isn’t the leverage itself, but using it without a clear, calculated edge and a full understanding of the potential downside.
- “Courage in trading is not about taking big risks but about trusting your analysis.” This separates courage from recklessness. True trading courage, according to this philosophy, comes from having done the research so thoroughly that you have the conviction to execute the trade, even if it’s a contrarian or massive position.
- “Currencies tell stories – you just need to listen to their fundamentals.” This quote highlights his macro-fundamental approach. Krieger believed that currency price movements weren’t random; they were narratives driven by underlying economic fundamentals, interest rates, and capital flows.
8. Risk Management Lessons from Krieger
While Andrew Krieger is famous for a highly leveraged trade, his success was not built on blind gambling. His methods provide key lessons in risk management, particularly in how to handle high-conviction setups.
- Use structural stop-losses: Even in his massive NZD short, the position was reportedly protected by options. This acted as a defined stop-loss. For modern traders, this reinforces the need to always use a stop-loss and practice sound money management, no matter how confident the trade seems.
- Have a contingency plan: Krieger’s analysis was so deep that he was prepared for different market reactions. A professional trader doesn’t just plan for the trade to work; they have a contingency plan for what to do if it goes wrong or if the market reacts unexpectedly.
- Link position sizing to conviction: The Krieger story is a masterclass on position sizing. He didn’t use 400:1 leverage on every trade. He reserved that level of exposure for a rare, “once-in-a-generation” setup where his analysis provided maximum conviction. The lesson is to scale your trade size relative to the quality and certainty of the setup.
9. Andrew Krieger’s Personal Life
After his intense career on Wall Street, Andrew Krieger largely stepped away from the public eye. He is known to lead a very private life, primarily residing in the United States.
Unlike many other trading legends, he avoids the financial media and does not maintain a high public profile. His focus is said to have shifted to managing his own affairs and engaging in private financial strategy consulting. He also reportedly dedicates time to smaller-scale writing and teaching, sharing his market insights with select audiences, and maintaining a strong client focus rather than seeking large public seminars.
It’s worth noting that this trader is often confused with other public figures, notably a professor of Political Science at Montgomery College, who is known for his lectures, student ratings, and specific grading criteria. The trader, Andrew Krieger, however, remains focused on private financial consulting.
10. How the Krieger Trade Changed Forex
The 1987 NZD short was more than just a profitable trade; it sent shockwaves through the financial world and had a lasting impact on the foreign exchange market.
10.1. Raised Awareness of Market Liquidity Risk
Krieger’s trade was a stunning demonstration that a single, well-capitalized trader could challenge the currency of a smaller developed nation. It proved that even sovereign currencies could be vulnerable to massive speculative pressure, highlighting the significant liquidity risk present in smaller currency markets.
10.2. Inspired Tighter Regulation and Leverage Limits
In the aftermath of the 1987 crash and highly leveraged trades like Krieger’s, many financial institutions and regulators began to re-evaluate their risk policies. This, along with other factors, inspired future regulatory changes. Investment banks tightened their internal controls and began imposing stricter leverage limits on their traders to prevent a single individual from taking on such enormous risk.
10.3. Influenced Next-Generation Macro Traders
Krieger’s bold, analytical, and high-conviction style heavily influenced his peers and the next generation of global macro traders in the financial markets. His success reinforced the effectiveness of the macro approach, inspiring other legends like Paul Tudor Jones and Stanley Druckenmiller (Krieger’s former colleague at Soros Fund Management) to continue pursuing large-scale trades based on deep fundamental analysis.
11. Useful Insights for Modern Forex Traders
The career of Andrew Krieger provides several timeless lessons for today’s Forex traders, even those not managing billions of dollars.
- Pick your battles: Krieger’s fame rests on one or two massive trades, not thousands of small ones. The lesson is to avoid constant trading (over-trading) and instead patiently wait for a high-probability setup where the odds are overwhelmingly in your favor.
- Analyze the big picture: Modern traders can apply his macro approach by thoroughly analyzing capital flows, interest rate differentials, and overall market sentiment (risk-on/risk-off). This fundamental analysis helps identify major, long-term currency mispricings.
- Embrace calculated risk: Krieger’s story teaches traders to have a “calculated risk” mindset. This means not being afraid to take a position (even a large or contrarian one) once in-depth analysis provides strong conviction. It is the opposite of a reckless gamble; it is courage based on data.
12. Frequently asked questions about Andrew Krieger
13. The Bottom Line
Andrew Krieger‘s career is a powerful testament that deep market knowledge and psychological discipline can be stronger than crowd sentiment.
His legendary 1987 NZD short remains a timeless case study in global macro analysis, calculated risk management, and the courage to act on high-conviction analysis.
More than just a story, his legacy continues to inspire traders who dare to “think differently” and “trade smarter”. To continue learning from the market’s most fascinating figures and trading strategies, keep following PipRider for more expert insights and trading knowledge.
