Situational Awareness bets big on AMD again after July bust

Situational Awareness's rise and stumble happened inside a single year. According to an investor letter seen by the Financial Times, the fund returned 439% net from the start of the year through June 30, briefly ranking among the best-performing large funds of 2026. That run was built on roughly four times leverage, which turned against it when AI stocks reversed in July: Its portfolio fell about 67 percent, and the fund sold off its AI assets, with Citadel buying much of the public-equity holdings a day later.

The new positions read as a deliberate re-entry into the same infrastructure theme that made and then hurt the fund. Processors, cloud computing, memory and electricity are described in the article as some of the main bottlenecks in the AI buildout, so the trade amounts to a wager that those constraints — not the broader market mood — define where the next leg of value sits.

What the outcome hinges on is whether the option premiums, reported at hundreds of millions of dollars, can absorb a second stretch of volatility. If AI stocks turn again, the leverage that amplified the earlier gains could expose the positions once more — and because these are options, that test may become visible through the trades themselves. For other investors in the same names, the re-entry is less a signal than a clue about where one aggressive AI investor sees the next opportunity.