Leopold Aschenbrenner was hailed as a great prognosticator, but he did a poor job of interpreting history. The tech wunderkind’s misfortune is a reminder — useful for the AI era — that an investor can be right and still come undone.
Situational Awareness, the fund the OpenAI alumnus founded in 2024, sold most of its publicly traded securities to rival Citadel after banks called in their loans. On the face of it, what happened is simple: Aschenbrenner thought AI-related stocks would go one way; they went the other. Since he’d funded his trades with debt, this quickly turned into a liquidity crunch.
Was he wrong? To mix short-term leverage with volatility, definitely. It ought not to be a shock if what went up like a rocket sometimes comes down like a stick. Of the 29 US-listed stocks the fund reported holding at the end of March, the average share price is down 21 per cent in the last month. Chipmaker Sandisk, one of its large holdings, is down 45 per cent.