AI hedge fund sells public portfolio after margin pressure

A hedge fund that became a multibillion-dollar phenomenon by betting on the infrastructure behind artificial intelligence is rapidly unwinding its public stock portfolio after steep losses and margin pressure. Situational Awareness, founded by former OpenAI researcher Leopold Aschenbrenner, sold its entire portfolio of publicly traded equities on or around July 30, 2026, in a move to meet obligations with its lenders.

The fund, which managed an estimated $20 billion, faced a sharp reversal after a severe selloff in AI-related stocks throughout July eroded the value of its highly leveraged positions. People familiar with the matter said several major prime brokers, including Bank of America, Goldman Sachs, and JPMorgan Chase, worked with the fund to raise cash or reduce positions. The entire public portfolio was reportedly marketed and sold to a single, undisclosed buyer ahead of the market open on July 30.

The losses were driven by a broad downturn in technology stocks, particularly those linked to AI infrastructure. Key holdings such as memory chip maker SK Hynix, cloud provider Nebius Group, and energy company Bloom Energy fell significantly. The fund also suffered from...