Largest Currency and Commodities Plays: Warren Buffett vs George Soros

Major Currency Trades

Investor	Trade	Year(s)	Position Size	Outcome	Strategy
George Soros	British Pound Short	1992	$10 billion short position	$1.8-2 billion profit	Bet against pound staying in ERM, leveraged entire $1 billion fund
George Soros	German Deutsche Mark Long	1992	Part of $10B currency play	$1.8 billion profit (combined)	Bought marks while shorting pounds during Black Wednesday
Warren Buffett	Japanese Yen Exposure	2020-2025	Yen-denominated bonds for Japanese investments	Ongoing currency hedge	Issued yen bonds to finance Japanese trading house investments
Warren Buffett	Foreign Currency Forwards	2003-2006	$11 billion in forwards	Mixed results	Used derivatives for currency hedging, not speculation

Major Commodities Trades

Investor	Commodity	Year(s)	Position Size	Outcome	Strategy
Warren Buffett	Silver	1997-2006	129.7 million oz (3,500-4,000 tons)	Estimated $500M+ profit	Physical silver purchase worth ~$1 billion initially
George Soros	Gold Mining Stocks	2016	Significant gold sector investments	Mixed	Bought gold miners during market uncertainty
Warren Buffett	Oil/Energy	2020-present	Chevron (~$25 billion stake)	Strong gains	Major energy sector play through Chevron stock

Key Insights and Comparisons

George Soros - Currency Specialist

• Famous for: "Breaking the Bank of England" - the most famous currency trade in history
• Approach: Highly leveraged macro trades based on economic fundamentals and government policy analysis
• Risk Profile: Extremely high risk, high reward - willing to bet entire fund on single trades
• Signature Move: The 1992 pound trade where he leveraged his entire $1 billion fund to take a $10 billion position

Warren Buffett - Selective Commodity Investor

• Famous for: Large-scale silver accumulation and long-term energy investments
• Approach: Fundamental value investing applied to commodities and currency hedging for international investments
• Risk Profile: Conservative, long-term focused with careful risk management
• Signature Move: The silver trade demonstrated he could apply value investing principles to commodities when conditions were right

Notable Trade Details

Soros - Black Wednesday (September 16, 1992)

• Built $1.5 billion position against sterling leading up to the trade
• Leveraged his entire Quantum Fund ($1 billion) to create $10 billion exposure
• Profit: $1.8-2 billion in one week
• Impact: Forced UK out of European Exchange Rate Mechanism

Buffett - Silver Investment (1997-2006)

• Accumulated 129.7 million ounces (nearly 20% of annual world production)
• Held physical silver, not futures or derivatives
• Investment thesis: Supply-demand imbalance in industrial silver market
• Sold gradually between 2002-2006 for substantial profits

Current Positions (2025)

• Buffett: Major Japanese trading house investments with yen exposure, Chevron energy play
• Soros: Less active in major commodity/currency trades, more focused on philanthropic activities

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### The Dialogue of Shadows and Substance

**Soros:** I speak of a castle built on a foundation of mirrors. Its lords are brilliant, and their power is real, yet it grows only when others believe in the reflection they project. What is the name of this castle, and when does its strength become its fatal flaw?

**Buffett:** I speak of a farmer who owns the finest soil. He is visited by traders who offer to constantly buy and sell his dirt, each time taking a slice for themselves. The soil remains just as fertile, but the farmer grows poorer. What is the siren song that lures him from his plow?

**Soros:** You measure the weight of the castle against the substance of the land it stands upon. But what if the very act of measuring changes the weight? Is the measure a ruler, or is it a weapon?

**Buffett:** There are two clocks. One ticks with the steady, silent rhythm of seasons and harvests. The other frantically counts the passing of seconds, its alarm bells ringing with greed and fear. Which clock tells the true time, and which one merely tells the time of the crowd?

**Soros:** In a storm, the crowd rushes from the castle of mirrors to a single, ancient vault, demanding sanctuary. The man who holds the key did not build the vault, but he is the only one who can open it. What did he truly bet on: the strength of the lock, or the predictability of the storm?

**Buffett:** I have said I would not buy all the gold in the world. But in the storm, my paper became harder than their metal. So I ask you: is the true value of a shelter in the thickness of its walls, or in the number of souls who believe it will stand?

**Soros:** The market is a historian writing the future in real-time. But every sentence it writes changes the past it just recorded. How can one invest in a story that is being rewritten with every trade?

**Buffett:** I seek a business that a fool could run, because someday one will. I buy a company that will still be selling its product in twenty years, regardless of who is on the throne or what the ticker says. Am I buying the river, or simply the patience to wait for the water to flow?

**Soros:** You speak of moats. But what is a moat but a barrier that defines an inside and an outside? Does the moat protect the castle from the world, or does it simply convince the world of the castle's worth?

**Buffett:** There is a wheel of fear and greed. Some try to predict its spins, to jump on and off at just the right moment. I prefer to stand at the center, where it is still. What is found at the center of the wheel?

**Soros:** You stand at the center, a monument to substance. But your shadow, cast by the spinning wheel, is long and distorted. Which has more power in the moment: your stillness, or the dance of your shadow?

**Buffett:** The Helpers preach that the wheel is everything. They sell maps of its spins. But if the wheel is always turning, what is the value of a map that is obsolete before the ink is dry?

**Soros:** Exactly. So we agree the maps are useless. But if you reject the maps, do you also reject the cartographer? Or do you become the cartographer who draws not the wheel, but the still point at its center?

**Buffett:** I am a gardener, not a cartographer. I do not draw the plant; I plant the seed, water it, and wait. The cartographers of the wheel are too busy mapping the weather to ever taste the fruit. What is the seed, and what is the fruit?