저자: OxTalks · 외국인
요약 보기
영상은 Situational Awareness 헤지펀드가 약 4배 레버리지로 AI·반도체주에 집중 투자하다 7월 매도 압력으로 67% 손실을 입고, 시타델 증권이 포트폴리오의 80% 이상을 약 10% 할인가에 인수해 블록 매매로 처분했다는 사례를 소개한다. 과도한 레버리지의 위험성을 강조하며, 반도체 기술주 반등 이후 시타델이 차익을 얻었을 가능성을 언급한다.
다듬은 글
Long before situational awareness exploded a few weeks ago and forced Citadel Securities to sell off most or all of its public portfolio for next to nothing. I've been covering the concept of financial leverage on this channel for some time now. The idea of credit ETFs, the idea of leveraging paper gold and silver, or whatever, taking out loans to buy cryptocurrencies, metals, or stocks—why is that such a bad idea.
Because if the market turns even slightly and you are leveraged, you get hit with a multiplier on the downside. And this is a situation that many people don't take into account when deciding to do this. So, I want to explain the concept before I move on to today's news , which I saw in the Financial Times a few days ago, about what Citadel Securities has now done with the portfolio it acquired.
They essentially dumped everything, which gives a clear idea of what Ken Griffin and his team think about the feasibility of the investments this hedge fund has made. So, as reported, Situational Awareness was operating with approximately 4x leverage, 400% gross risk just before the forced sale of most of its public stock portfolio to Citadel.
Financial News London reports that leverage has reached approximately 400%. Other reports have also described the fund as operating with 4x leverage on its concentrated portfolio of AI and semiconductor stocks. Their public stock portfolio was reportedly worth around 16 billion when Citadel stepped in and essentially bailed it out.
In July alone, “situational awareness” lost 67%, triggering early collateral requirements and effectively forcing the transaction. So, again, what does 4x leverage mean? Essentially, this means that for every dollar of equity, the fund had almost $4 in gross market risk. With this leverage, a market move of 20-25% against a position, regardless of the asset, can wipe out most or all of the capital supporting those positions.
That's how critical it is. So, following this, yesterday's FT article says that Citadel has unloaded 80% of the portfolio bought out of " situational awareness". Don't forget to subscribe to the channel and like this video. Also, join the monthly Risk Map publication, link in the description below. The new issue will be released on September 1st.
I will do what I think is a complete expose from beginning to end about Mark Walters, Guggenheim, and this entire, let's say, empire that he built, which is now crumbling before our eyes. So, let me share with you a story from the FT. So, Citadel sold over 80, and this news only broke a few days ago.
Sold over 80% of the portfolio he took on, buying out most of Situational Awareness's stock stakes last month, after the AI-focused hedge fund nearly collapsed in a recent sell-off . Ken Griffin...I think I said Ken Griffith. Ken Griffin's hedge fund told investors on Friday that it had shed most of the aggregate risk from its Situational Awareness portfolio, executing nearly 100 block trades worth more than $4 billion in a matter of weeks to unload positions , according to a letter seen by the FT.
Selling billions of dollars worth of shares in just 3 weeks suggests that Citadel likely resold these positions at a sizable profit. And that's the point. Listen to this. As tech stocks have rebounded significantly since Griffin struck a deal with Situational Awareness in late July. And this is the main thing.
If you, well, from a normal person's perspective, don't have 4x leverage, 3x, or whatever, and the market is down, you're waiting out the storm. You just wait calmly. But if you use leverage, you get margin requirements, and that forces you to act. So, this guy from Citadel, well, whatever. Looks like a genius in retrospect.
He came in, then of course there was a little rebound, and he drained all that goodness. Citadel's sudden takeover of the Situational Awareness stock portfolio was one of the largest bailouts in Wall Street history. A dramatic episode, as they say, in a volatile period for stocks, when investors rushed into AI-related stocks before being gripped by anxiety that the boom in the sector had been overblown.
The week-long sell-off in technology stocks in July caused what is said to be massive pain on Wall Street. The hedge fund led by 24- year-old OpenAI graduate Leopold Aschenbrenner was the biggest victim. An AI-focused fund has amassed over $ 20 billion in assets in just 2 years, despite its founder having zero experience on Wall Street.
Aschenbrenner, who was fired from OpenAI, is said to have been fired. I don't know if this is true or not, but let's take it for granted, he boasted of extensive connections in Silicon Valley, and some called him a prodigy and the Nostradamus of AI. Well, obviously not. Faced with losses during the July sell-off , Aschenbrenner initially tried to raise additional funds, reportedly by selling individual assets, but then decided to sell most of his shares to Griffin's firm in a deal that was completed in just 24 hours.
Listen, there will always be people waiting on the sidelines with cash to pick up the balances when these guys over- leverage. If he simply owned the assets at a 1:1 ratio and they fell in price, well, he would wait out the storm, and in a week or two or three he would be back where he started, or close to it, but he wouldn't be liquidated.
Citadel acquired these positions at a discount of around 10%, as previously reported by the FT, but the company could afford to hold the shares until the market stabilized. Shares of Situational Awareness's largest holdings, including chipmakers Sandisk and Micron, rebounded quickly, giving Griffin the opportunity to make a quick profit.
In a sense, this agreement became a self-fulfilling prophecy. Griffin's agreement to buy back Archegos's stock portfolio allayed fears of a further forced sell-off on Wall Street, helping to boost stock prices across the technology industry . Citadel's subsequent exits from these positions included some of the largest block trades of the year, according to firm officials.
As noted, Griffin did not tell investors what the value of the stock portfolio was or how much the firm paid for those positions. Of course, this is a matter of operational security. Well, you know, that's how it happens. Citadel beat out competitors, including Millennium Management, in the race for this portfolio of stocks.
Secret trading firms D.E. Shaw and Jane Street, which Rod and I have already talked about, also fought for this asset . Wen Assets was one of the hedge fund investors, and they suffered heavy losses. I did a program about this a few days ago, okay? So, anyway, this is a story I wanted to share because it just reinforces how the idea of leverage can be fatal for individual investors, large hedge funds, or anyone else.
So keep that in mind, friends. Thank you for watching. If you like the content, share the video, like it, and please subscribe to the channel. Go ahead and subscribe to the monthly " risk map" newsletter. Write your thoughts and feedback on this topic, because this is not the last time we see things like this explode due to greed.
We know that greed kills. Thank you again for watching. And on that note, see you soon . See you later.
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