AI hedge fund unwinds after 78% fall

Situational Awareness, the AI-focused hedge fund founded by former OpenAI researcher Leopold Aschenbrenner, sold its public portfolio to Citadel after its value fell from $45 billion at the start of July to $10 billion, a 78% collapse. The Verge reports that all four of its largest disclosed holdings—Nebius, Sandisk, Micron and CoreWeave—dropped more than 35% this month while short software positions also moved against it, forcing brokers to raise cash for margin requirements. Operators financing the same vertically integrated AI thesis should file the unwind beside the weak link in Nvidia’s $50 billion data-center loop: sound demand forecasts do not neutralize leverage, timing or correlated supplier exposure.