3 Citadel Funds Soar After Buying Situational Awareness’s Distressed AI Stocks
Three Citadel funds posted July features after the agency purchased a reduced portfolio of synthetic intelligence shares from Situational Awareness, the collapsed hedge fund run by former OpenAI researcher Leopold Aschenbrenner.
Ken Griffin’s flagship Wellington fund rose 5.9% for the month. Almost all of that acquire arrived after the acquisition.
Citadel Funds Made Half a Year’s Gain From One Deal
Wellington was up simply 0.45% in July earlier than the deal, Bloomberg reported. It closed the month at 5.9%.
That hole is the story. The fund did nearly nothing for 3 weeks, then made its yr in days.
For scale, Wellington returned 10.2% across all of 2025. July alone delivered greater than half of that.
Wellington is now up 12% in 2026. It has already crushed final yr’s full consequence with 5 months nonetheless to run.
The agency’s different two books did higher. Citadel Equities gained 14.2% and Tactical Trading added 11.1%, based on figures shared with traders.
Both sit close to 27% for the yr. In all of 2025 they returned 14.5% and 18.6%.
Rivals moved the opposite approach. Whale Rock’s flagship fund dropped 21.7% in July, erasing roughly half its 2026 features.
Situational Awareness Had No Choice however to Sell
Situational Awareness peaked close to $45 billion in early July. Weeks later it held about $10 billion.
The fund borrowed closely. Its leverage ran as high as 4 occasions its personal capital, which magnified each transfer.
It wager on AI infrastructure and towards software program. When chip and memory stocks slid, small losses turned massive quick.
Its principal holdings every fell greater than 35% through the month. Goldman Sachs, JPMorgan Chase and Bank of America then demanded extra collateral.
The fund couldn’t meet these calls. It offered its entire public inventory e-book, and Citadel took that leveraged equity portfolio at roughly a ten% discount.
The pressured promoting stopped. The identical shares bounced. Citadel already owned them.
A Playbook Griffin Has Run for 20 Years
None of that is new. In July 2007, Sowood Capital misplaced half of its $3 billion in underneath a month. Citadel purchased its positions and profited as markets recovered.
A yr earlier than that, Amaranth Advisors collapsed on pure gasoline bets. Its vitality e-book went to Citadel and JPMorgan.
The sample is constant. Griffin waits for a vendor with no choices, then names the value.
Aschenbrenner, 25, had returned 439% by June and greater than 1,000% since launching in July 2024. His fund survives on personal holdings, together with a stake in Anthropic value about $5 billion.
Citadel has booked the acquire however not offered the shares. The volatility that broke Situational Awareness now sits by itself books.
August earnings from those self same AI names will present what the low cost was actually value.
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