Tiger Management lost $2B shorting the yen — the trade that killed the fund

Tiger Management was the second-largest hedge fund in the world, founded by Julian Robertson in 1980. By mid-1998, it peaked at $22 billion in assets under management, known for its global macro strategy.

Tiger had a large short position on the Japanese yen paired with long exposures to US assets — a classic carry trade betting the dollar would strengthen against the yen. The trade initially generated roughly $2 billion in gains as Japan's economic stagnation drove yen depreciation.

In late August to early September 1998, the trade reversed catastrophically. The yen rallied sharply amid the Russian financial crisis and the collapse of Long-Term Capital Management, as global investors fled to the yen as a safe haven. Tiger lost approximately $2 billion in days — 12.6% of its flagship Jaguar fund alone. The fund also lost $600 million on Russian ruble debt.

The loss triggered a redemption spiral. Investors withdrew $7.7 billion between August 1998 and early 2000. Robertson refused to chase dot-com stocks he considered overvalued, and the fund lost 19% in 1999. By March 2000, Robertson liquidated the fund and returned all outside capital, calling the market a 'Ponzi pyramid.' Tiger Management became a family office.