After suffering huge losses just a month ago, hedge fund Situational Awareness has returned to the market, aggressively buying call options and betting on AI-related industry chain companies such as SanDisk (SNDK.US).

According to Jinse Finance APP, the hedge fund Situational Awareness—which nearly collapsed at the end of July due to heavy leverage and concentrated bets on AI— is making a comeback in the market. According to sources familiar with the matter, this AI-focused fund founded by former OpenAI researcher Leopold Aschenbrenner has recently made large purchases of call options, betting on companies in the AI and related supply chains such as AMD (AMD.US), Bloom Energy (BE.US), CoreWeave (CRWV.US), SK Hynix (SKHY.US), and SanDisk (SNDK.US).

Reports indicate that these trades primarily took place last week and at the beginning of this week. Journalist David Faber stated that Aschenbrenner has already bought option positions worth "hundreds of millions of dollars in premiums" this time, making for a considerable scale. Faber commented, "It appears he's getting back into the trades that previously generated massive gains, which abruptly ended with the blow-up in July."

This means that after large-scale deleveraging and clearing public stock positions at the end of July, Situational Awareness has resumed taking on risk just over a month later, once again choosing the AI trades it knows best.

Compared with directly buying large quantities of stocks, this time Situational Awareness is mainly building exposure through call options. Its latest bets cover several AI industry chain components, including AI chips, data center infrastructure, power, and storage. Among these, AMD is a major player in the AI chip sector, CoreWeave is a company providing AI cloud infrastructure, Bloom Energy benefits from growing power demand of data centers, while SK Hynix and SanDisk are involved in AI storage and related supply chain segments.

Situational Awareness previously achieved remarkable returns through aggressive bets on the AI industry chain. According to a letter to investors obtained by the media, the fund's return rate reached as high as 439% from the beginning of this year to the end of June.

The fund, established less than two years ago, also saw its assets under management expand rapidly. It was reported that at one point, assets under management exceeded $20 billion. Aschenbrenner himself became well-known in Silicon Valley after publishing the article "Situational Awareness" in 2024, in which he predicted that artificial intelligence would have a profound impact on the economy and society.

However, the high returns came with extremely high risk. Situational Awareness previously amplified returns from AI trades by making heavy use of leverage, while also concentrating holdings in semiconductor and other AI-related assets. When tech stocks suffered a sharp sell-off at the end of July, the fund's positions came under intense pressure and eventually fell into a liquidity crisis.

Situational Awareness was subsequently forced to cut its public market portfolio dramatically and sold over $4 billion worth of stock positions to Citadel, managed by Ken Griffin. These assets were mainly related to AI and semiconductor companies. Citadel then quickly reduced the related risk exposure, while Situational Awareness retained some private market assets, including equity in Anthropic, and a small amount of public market holdings.

Despite this severe downturn, Situational Awareness did not exit the market. Earlier this month, Aschenbrenner told investors that after the sharp drawdown in July, the fund has still achieved a positive return of about 80% so far this year.

The renewed large-scale buying of call options now suggests Aschenbrenner is rapidly resuming risk-taking in the public market. Notably, this is not a tentative, small-scale comeback. Reports state that hundreds of millions of dollars have already been spent on option premiums, indicating a substantial re-exposure to AI-related risk for Situational Awareness.