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Jane Street suffered a $15 billion loss in July due to a sharp decline in artificial intelligence-linked stocks.

Jane Street reported a significant loss of approximately $15 billion in July, primarily driven by a sharp market sell-off in artificial intelligence-focused technology stocks. The firm's investment in Situational Awareness, an AI-focused hedge fund managed by Leopold Aschenbrenner, experienced a significant drawdown that triggered margin calls and forced the sale of most of its stock portfolio to Citadel. Despite this monthly setback, Jane Street's trading revenue has exceeded $40 billion since the beginning of the year, outperforming the largest banks and many of its competitors in the market-making industry. The firm attributed the July losses to the same portfolio of trades that had delivered strong results in the second quarter. Following the decline, Jane Street stated it intends to adopt a more selective approach to risk management. The company has already begun closing a significant portion of its positions in areas where it suffered losses and reducing risk levels across other trading strategies.

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