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Ken Griffin confirms Citadel has successfully unwound the majority of risk from Leopold Aschenbrenner's Situational Awareness portfolio.

Ken Griffin of Citadel addressed the firm's acquisition of assets from Leopold Aschenbrenner's Situational Awareness hedge fund in a letter to clients on Friday. The administration announced that Citadel has unwound more than 80% of the aggregate risk from the original portfolio by executing over 100 block trades valued at more than $4 billion. Situational Awareness, a fund focused on the artificial intelligence trade, faced steep losses in July, forcing it to sell its public stock positions. Citadel stepped in to purchase these assets at a discount. While the fund had heavily invested in memory chips and Bitcoin miners, the lack of hedging and a doubling down on long bets caused the fund to lose money on both long and positions. Griffin noted that the rapid transfer of the portfolio was made possible by the cooperation of banking teams. Following the acquisition, three Citadel funds saw sharp gains as the AI trade began to rebound.

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