Leopold Aschenbrenner’s Situational Awareness hedge fund has offloaded most of its publicly traded AI-related stocks to Citadel after suffering notable losses on its bets. The move came after the fund tried to find buyers for these holdings and secure fresh capital in recent days.
The portfolio included shares in companies like South Korea’s SK Hynix, known for semiconductor production, which experienced a steep decline amid growing skepticism about the AI sector. Interestingly, SK Hynix reported a massive 557% year-over-year jump in operating profit, and its stock has rebounded roughly 16% recently.
Fund’s Rise and Recent Struggles
Situational Awareness, launched about two years ago by former OpenAI researcher Aschenbrenner, quickly scaled up to manage over $20 billion before this downturn. Millennium Management also showed interest by submitting a bid for the same portfolio during the sale.
While the fund has shed these public stock positions, it still holds onto private equity investments, including stakes in prominent AI developer Anthropic. Despite sharp losses in long AI infrastructure assets and some unfavorable short positions, the fund remained meaningfully profitable year-to-date through June. Investors have been updated about potential new capital commitments expected starting this August, with particular attention on upcoming events like a potential Anthropic IPO.
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