AI Fund Manager Leopold Aschenbrenner’s Fund May Help AI Stocks Hit Bottom

Mars Finance reports that on July 30, Citrini posted that the investors in Leopold Aschenbrenner’s AI-themed hedge fund, Situational Awareness, initially invested not merely because they were bullish on AI, but because they trusted Leopold Aschenbrenner’s assessment of AI’s development trajectory and the fund’s strategy of concentrating on high-beta AI assets. Since its inception in 2024, the fund rose approximately 2,200% at its peak, but has recently experienced a significant pullback due to declines in related stocks. He believes that such deeply committed AI believers are unlikely to turn bearish on AI simply because SK Hynix’s stock price halved within six weeks. Even if an investor had put in $100 million at the fund’s launch and lost 90% of their assets by July, their remaining position would still be worth approximately $230 million based on the cumulative 2,200% return. Citrini expects existing investors to continue buying on dips, and Situational Awareness is likely to attract new capital currently being sought. After raising funds, the fund may unwind some short-term hedges and deploy the new capital into what it calls “the best buying opportunity since April 2025”; market makers who sold hedging instruments may also simultaneously cover their short positions. Leopold may not be in trouble—in fact, fundraising, unwinding hedges, and repurchasing assets could help push AI stocks toward a short-term bottom. However, if these AI-believing investors with substantial unrealized gains refuse to add to their positions on dips, the related stocks could continue to decline sharply.