AI hedge fund Situational Awareness may have sold its public portfolio, but it still has its Anthropic shares

Situational Awareness, a hedge fund formed by a former OpenAI researcher, has sold most of its public stock portfolio to another hedge fund after experiencing significant losses in AI infrastructure investments over the past month. The fund had been highly successful, returning 439% through June with assets reaching as much as $45 billion, but positions dropped sharply as public investors grew concerned that major capital spending in AI infrastructure was not generating near-term revenue. Despite the public portfolio sale, Situational Awareness retained its private investments, including a $5 billion stake in Anthropic that may appreciate further if the company goes public as expected. The fund's losses were amplified by leverage, a strategy of using borrowed money to purchase stocks, which magnified the impact of the market decline.