Goldman Sachs Earns Over $200 Million in Fees from AI Fund 'Situational Awareness'

BlockBeats news, September 25 — According to the Financial Times, AI hedge fund "Situational Awareness" became one of Goldman Sachs' (GS.N) largest hedge fund clients in its prime brokerage business this year, generating more than $200 million in fee revenue for Goldman Sachs. According to people familiar with the matter, "Situational Awareness" at one point became a major client of Goldman Sachs' trading division this year, with its rapid growth and strategy of using borrowing to amplify trading scale driving fee growth. When the fund was founded, its assets under management were only several hundred million dollars, and its returns at one point exceeded 400%, expanding its scale to more than $20 billion. However, AI-related stocks experienced sharp volatility this year, and the fund's previously large public market positions were hit, with losses further amplified by leveraged borrowing.

Founder Ashenbrenner subsequently sold most of the stock positions, with assets that at one point amounted to about $16 billion being sold to Citadel. In July, he told investors that he would no longer amplify investments through borrowing in the future. Despite the losses, "Situational Awareness" still maintains a cooperative relationship with Goldman Sachs and has begun establishing a trading relationship with tech stock broker Clear Street.