Citadel completed more than 100 block trades valued at over $4 billion to reduce exposure from the portfolio it acquired from Leopold Aschenbrenner’s Situational Awareness hedge fund, according to a CNBC report citing sources familiar with the matter.
The unwinding follows a sharp reversal in AI-related stock bets that drove Situational Awareness to losses of about 67% in July, erasing gains from a 439% surge in the first half of 2026. Citadel initiated talks with the fund on July 29, with CNBC reporting the following day that Situational Awareness was forced to sell all public stock positions amid steep declines.
Citadel’s flagship multistrategy Wellington fund posted a 5.94% return in July, its strongest monthly performance since 2022, benefiting from the portfolio’s liquidation. The fund’s founder, Ken Griffin, noted in an internal letter that the transaction required coordinated efforts from trading and prime brokerage teams across multiple banks to facilitate the rapid transfer of assets.
Situational Awareness retained select private investments, including a stake in Anthropic, while liquidating billions in public holdings to address leverage and liquidity constraints. Holdings such as SanDisk and Micron, which had driven the fund’s earlier gains, contributed to its July losses as valuations declined.
