Leopold Aschenbrenner’s Situational Awareness hedge fund has transferred the majority of its publicly traded stock positions to Citadel after incurring substantial losses on artificial intelligence bets.
The transaction follows efforts by the firm to find buyers for those holdings and attract fresh investor money in recent days, reports The Wall Street Journal.
Among the affected positions were shares in South Korean semiconductor producer SK Hynix and other AI infrastructure companies that declined sharply amid broader market skepticism toward the sector. SK Hynix recently reported a 557% year-over-year increase in operating profit and its stock price is up by around 16% at the time of writing.
The fund, launched roughly two years ago by Aschenbrenner, a former OpenAI researcher, had expanded rapidly to manage well over $20 billion before the recent downturn.
Millennium Management, a hedge fund, also submitted a bid for the portfolio during the sale process.
Situational Awareness continues to hold its private equity investments, which encompass positions in leading AI developer Anthropic.
Additional reporting indicates the fund experienced sharp recent drawdowns in long AI infrastructure names alongside adverse moves in certain short positions, though it remained significantly positive on a year-to-date basis through June.
The firm has communicated with investors about potential capital commitments starting in August and highlighted upcoming catalysts such as a possible Anthropic initial public offering.
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