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Goldman earned over $200m in prime brokerage fees from AI hedge fund
The AI-focused hedge fund, founded in 2024, grew from several hundred million dollars of assets at launch to more than $20bn before AI-linked stock declines triggered major losses.
Goldman Sachs has generated more than $200 million in fees this year from Situational Awareness, an AI-focused hedge fund, making it Goldman’s largest prime brokerage client among hedge funds, according to a Financial Times report citing unnamed people familiar with the matter, and covered by Hedgeweek.
Situational Awareness was founded in 2024 by Leopold Aschenbrenner, a former OpenAI researcher with no previous trading experience. The fund, which was among the biggest clients of Goldman’s trading division this year alongside established multi-strategy firms including Citadel and Millennium, reportedly saw Goldman and the hedge fund decline to comment.
The prime brokerage fees, the people said, were driven by the fund’s rapid expansion and by the highly leveraged nature of some of its trading strategies. Aschenbrenner’s fund initially generated returns of more than 400% and grew from several hundred million dollars of assets at launch to more than $20bn.
However, the report said a sharp selloff in stocks linked to artificial intelligence led to substantial losses, after the fund had relied on borrowing from investment banks to increase the size of its trading positions.