Leopold Aschenbrenner’s AI-focused hedge fund, Situational Awareness, suffered catastrophic losses in July 2026. The fund utilized a Texas hedge strategy to amplify positions rather than reduce risk. Its public equity portfolio declined by approximately 67% as semiconductor stocks fell sharply.
Total assets reached a peak of $45 billion before the collapse. Remaining assets fell to approximately $10 billion. The fund failed to meet margin calls triggered by these steep losses.
Lenders forced Situational Awareness to liquidate the bulk of its public stock holdings. Ken Griffin’s Citadel purchased the discounted portfolio, including major stakes in Micron and Taiwan Semiconductor.