Citadel buys most of Situational's stock holdings after AI share rout, sources say

NEW YORK (July 30): Situational Awareness, an AI-focused hedge fund run by former OpenAI researcher Leopold Aschenbrenner, sold the bulk of its stock portfolio to Ken Griffin's Citadel after being battered by heavy losses in its tech holdings, two sources familiar with the matter told Reuters on Thursday. Since the fund's launch in 2024, Aschenbrenner has garnered a cult-like following among investors for his prescient bets on the AI sector that propelled his fund to a lofty 439% return from the start of the year until the end of June. The fund was down around 67% so far in July after incurring heavy losses on AI stocks, the Wall Street Journal reported on Thursday, citing a source who saw a letter the firm sent to investors. They said Situational will hold a book of roughly US$10 billion after the deal comprised of stocks as well as private investments in companies like Anthropic. Griffin's Citadel, which has about US$71 billion of assets under management, is one of the world's most profitable and largest hedge funds. The hedge fund, which earlier managed about US$20 billion of assets and currently has about 20 employees, has used leverage to boost its positions in the past -- much like its peers.