Leopold Aschenbrenner’s Situational Awareness Returns to AI Stocks After July Rout

Leopold Aschenbrenner’s Situational Awareness is rebuilding exposure to artificial intelligence-related equities after a severe July selloff forced the hedge fund to unwind much of its public-market portfolio, according to CNBC’s David Faber.

The fund is reportedly buying options tied to AMD, Bloom Energy, CoreWeave, SK Hynix, SanDisk and the Roundhill Memory ETF, according to the report cited by Coin Bureau. The positioning closely follows Aschenbrenner’s long-standing thesis that the expansion of AI depends on several physical bottlenecks, including computing capacity, electricity, infrastructure and memory.

Situational Awareness Targets Key AI Infrastructure Segments

The reported options positions span several parts of the AI supply chain.

AMD provides exposure to AI computing demand, while Bloom Energy represents the power requirements associated with expanding data-center capacity. CoreWeave is positioned around AI infrastructure and cloud computing, while SanDisk and SK Hynix provide exposure to memory and storage components used throughout the AI ecosystem.

The strategy is notable because Situational Awareness experienced a dramatic reversal during July. The fund's assets fell from more than $45 billion to roughly $10 billion as a sharp decline in AI-related stocks forced it to unwind leveraged public-equity positions.

Earlier reports said the fund ultimately sold much of its public stock portfolio to Citadel after margin pressures intensified. Its collapse became one of the clearest examples of how concentrated exposure and leverage can amplify losses when a popular market trade reverses.

AI Infrastructure Thesis Faces a New Market Test

Aschenbrenner, a former OpenAI employee, has built his investment strategy around the expectation that rapidly expanding AI capabilities will require enormous increases in computing power, energy generation, data-center infrastructure and memory capacity.

The fund’s reported return to these sectors therefore represents more than a simple portfolio adjustment. It indicates that the underlying investment thesis remains focused on the physical infrastructure required to support AI growth, despite the losses suffered during the July downturn.

Public filings have previously shown that Situational Awareness held substantial positions in companies connected to memory, semiconductors, power and AI infrastructure before the selloff. Its largest disclosed U.S.-listed holdings at the end of June included SanDisk, Micron Technology, Bloom Energy, Taiwan Semiconductor Manufacturing and Nebius Group.

The renewed options activity also comes as investors continue to debate whether AI capital spending can justify the valuations assigned to companies supplying the industry's infrastructure. For Situational Awareness, the immediate question is whether its latest positions can capture another expansion in AI spending without exposing the fund to the leverage and liquidity markets pressures that contributed to its July collapse.

Writer: Victoria Hale
Technology & Blockchain Writer

Victoria Hale writes about blockchain technology, digital infrastructure, and the intersection of emerging technologies with finance. Her articles explore how new protocols and systems are shaping the evolving digital economy.

She prioritises clarity and accuracy when explaining technical developments to a general audience.