BlockBeats reported on July 30th that Ajitabh Bharti, Executive Director of Capital XB, stated that the Federal Reserve's lack of decisive interest rate action suggests potential political considerations. In a report, he noted that with the US midterm elections approaching, the Fed is perceived to prioritize stability over inflation control in the short term. This dynamic could benefit emerging markets like India in the short term. A relatively weaker dollar could alleviate pressure on the rupee and provide some breathing room for capital flows and external balancing. However, if US inflation persists or re-accelerates due to delayed policy action, the eventual correction could be more severe and disruptive, transmitting volatility to global markets, including India. (Jinshi)

According to a report by the Financial Times on July 30th, Situational Awareness, an AI-themed hedge fund founded by 25-year-old Wall Street AI stock guru and former OpenAI researcher Leopold Aschenbrenner, is seeking new funding. Following a recent sharp correction in AI-related stocks, this fund, known for its highly concentrated bets on the AI industry chain, has suffered significant losses and is seeking to replenish capital through communication with investors and potential asset sales.

Founded in 2024, Situational Awareness's investment strategy stemmed from Aschenbrenner's prediction of an accelerated arrival of AGI (AI Generative Technology). The fund once reached approximately $20 billion in size, achieving a net return of 439% as of June 2026, making it one of the most watched star funds in the current AI boom. Its holdings included companies related to AI infrastructure and computing power chains, such as Oracle, AMD, Nebius, and Sharon AI, and it used leverage to amplify its positions.

However, AI trading has cooled rapidly recently, with significant fluctuations in the South Korean KOSPI, the Nasdaq 100, and many AI infrastructure stocks. Situational Awareness was also caught in the pullback. The report states that Aschenbrenner acknowledged increased market volatility in recent investor communications, describing it as a new investment opportunity and encouraging investors to inject new funds before August 1st.

This fundraising also marks a significant event following the retreat of AI capital expenditure deals. Over the past year, the market was willing to pay high valuations for computing power, chips, electricity, and cloud infrastructure; however, as tech stocks have retreated further, funds are beginning to re-evaluate the return cycle, leverage risks, and crowded positions within the AI industry chain. Situational Awareness remains betting on the long-term trend of AI, including potential opportunities such as Anthropic's potential IPO, but in the short term, the market's tolerance for highly volatile AI assets has clearly decreased.

It's worth noting that Situational Awareness's previously disclosed 13F filing did indeed show a large number of put options. Its Q1 holdings revealed that the fund held significant put positions in major semiconductor and AI supply chain companies such as SMH, Nvidia, Oracle, Broadcom, AMD, TSMC, and Micron, with substantial nominal exposure. This structure was initially interpreted by the market as a relative value trade of "going long on AI infrastructure while hedging against a pullback in large-cap chip stocks."

However, put options do not mean that funds can completely avoid losses. 13F reports disclose the notional size of the underlying asset, not the premium, strike price, expiration date, or Delta, meaning the actual protection may be far lower than the stated figures. Furthermore, 13F reports only provide a snapshot of positions as of March 31st; by the time AI stocks experienced a significant correction in July, the relevant puts may have already been closed out, rolled over, or reduced. External investors cannot determine the current hedging status based solely on the first-quarter report.

More importantly, the funds' previous heavy long positions were concentrated in a group of highly volatile AI infrastructure stocks, including Bloom Energy, SanDisk, CoreWeave, IREN, Core Scientific, Applied Digital, Riot, and CleanSpark. The core logic behind these stocks is related to AI data centers, power, storage, GPU cloud, and the transformation of mining companies into computing power. These stocks are extremely resilient during AI capital expenditure upswings, but once the market begins to question the returns on AI investments, the financing environment, and customer demand, their declines often exceed those of traditional large-cap chip stocks.