“The race to artificial general intelligence won’t just play out in code and behind laptops. It’ll be a race to mobilize America’s industrial might.”
The author of this quote has been dubbed the savant of generative AI. And now he’s betting against its biggest stocks.
Leopold Aschenbrenner published the seminal Situational Awareness essay on Artificial General intelligence after being fired by OpenAI in 2024. He theorised that AGI, the ‘peak AI’ that can replicate practically any form of human cognition, would arrive far sooner than anyone thought.
He also prophesied that the barrier to mass adoption would shift away from computation and towards power, energy and materials.
Aschenbrenner then spun this anifesto into an investment fund backed by a string of tech superstars. Two years ago the fund started off with $255 million. This week, its 13F revealed a valuation of $13.7 billion.
The growth is astounding in itself. But what’s really interesting is the breakdown right now.
- The portfolio recently acquired put options in a string of semi-conductor manufacturers including NVIDIA (NSQ:NVDA), Oracle (NYQ:ORCL), Broadcom (NSQ:AVGO), Advanced Micro Devices (NSQ:AMD) and the Van Eck chipmaker ETF. Together, these chipmaker puts total more than $8 billion.
- Aschenbrenner is also long on a number of energy and infrastructure companies. Here are the seven biggest of these holdings:
We can infer two things from this. Firstly, that Aschenbrenner is bearish on frontier hardware stocks, or is at least hedging. Secondly, that he's bullish on those companies further upstream (despite the modest StockRanks).
Aschenbrenner isn't betting on the companies making AI's picks and shovels. He's betting on the companies making the picks and shovels for the picks and shovels.
And when you look at the numbers, it's easy to see why.
Let’s build a portfolio of Aschenbrenner's seven biggest semi-conductor put options. We'll include ASML Holding NV (AMS:ASML) , which is technically a supplier rather than a maker, but it's still operating at the blast furnace of innovation. And we'll exclude Van Eck because we're focusing on companies rather than funds. Then let's compare this list against the seven long positions that we profiled just above.
The performance differential is staggering.
Over the past six months, the upstreamers have beaten the downstreamers by 175.48% to 76.30%. When…
