This $2 Billion Hedge Fund Led By a Former OpenAI Researcher Is Betting Against All Semiconductor Stocks Except These 2 Industry Giants

Core Insights - The long-term potential of certain companies in the semiconductor industry may be underestimated due to the rapid advancements in artificial intelligence (AI) [1] - A hedge fund named Situational Awareness, founded by former OpenAI researcher Leopold Aschenbrenner, has quickly grown to over $2 billion in assets under management [2] Semiconductor Industry Overview - Situational Awareness has taken a significant short position against the VanEck Semiconductor ETF, holding 20,441 put contracts, which represents 27% of the fund's public holdings [5][6] - The fund's strategy indicates a bearish outlook on the semiconductor industry as a whole, particularly targeting larger companies like Nvidia, which constitutes over 20% of the ETF [6] Investment Positions - Despite the bearish stance on the semiconductor sector, Situational Awareness is heavily invested in Intel call options and Broadcom stock, which together account for 37% of the fund's public portfolio [7] - The investment in Intel is based on its potential role in AI development, especially as a U.S.-based leading-edge semiconductor foundry, with the U.S. government recently acquiring a 9.9% stake in the company [10][11] - Broadcom's investment is predicated on the expectation that AI chips will become increasingly specialized, with the company being a major partner for custom AI accelerators [12] Market Dynamics - Broadcom has secured significant contracts, including a $10 billion commitment from a new customer, likely OpenAI, which is expected to drive revenue growth in AI chips [13] - Both Intel and Broadcom have seen stock prices increase due to recent developments that support their long-term investment theses [14] - Current valuations for Intel and Broadcom may be high, leading investors to consider other AI stock opportunities with more attractive valuations [15]