AI Hedge Fund Situational Awareness Sells Portfolio After Massive Losses
Situational Awareness, an artificial intelligence-focused hedge fund launched in 2024 by 25-year-old former OpenAI employee Leopold Aschenbrenner, has sold most or all of its public stock portfolio to Ken Griffin’s Citadel. The fund, which reportedly managed up to $45 billion at its peak in July, suffered severe losses following a downturn in AI sector investments, though it retained its Anthropic shares.
Key points
- Leopold Aschenbrenner, a 25-year-old former OpenAI researcher with no prior trading experience, founded the AI-focused hedge fund Situational Awareness in 2024.
- Following a steep market decline in artificial intelligence infrastructure investments, the fund sold the majority of its public stock portfolio to Ken Griffin's Citadel.
- Assets under management at Situational Awareness reportedly plunged from a peak of $45 billion in July down to $10 billion following the asset sale.
- The fund previously returned 439% for the year through June before experiencing severe losses over several difficult weeks for AI stocks.
- Despite liquidating its public portfolio, reports indicate the firm still maintains its private shares in AI rival Anthropic.
Situational Awareness, a specialized hedge fund launched in 2024 by former OpenAI researcher Leopold Aschenbrenner, has liquidated the majority of its public stock portfolio. The assets were acquired by Ken Griffin's Citadel following a dramatic downturn in market valuations for artificial intelligence infrastructure.
Formed by the 25-year-old German-born investor—who graduated from Columbia University at age 19 and previously worked on OpenAI's superalignment team before his 2024 dismissal—the fund experienced a rapid rise and fall. Buoyed by bullish investment theses on semiconductors, compute, and energy infrastructure, the fund reportedly generated returns of 439% through June and saw assets swell to a peak of $45 billion at the start of July.
However, a sharp correction in AI-related equities over preceding weeks severely impacted the eight-person firm. According to reports, the fund's valuation dropped to $10 billion prior to the Citadel transaction. While the public stock portfolio has been largely or entirely sold off, sources indicate that Situational Awareness continues to hold its stake in rival AI firm Anthropic.
Sources
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