The new stock god of the US market, Leopold's Situational Awareness LP fund, had a complete turnover in its holdings in Q1 2026 (see Figure 1)! 🧐

I confirmed several times, thinking I might have misread it. The holdings in Figure 1 really dropped my jaw, scaring me. I hurried to clear nearly half of my AI US stock holdings tonight!

You have to understand this timing is very strange. First, the 10-year US Treasury yield has recently soared to an outrageous 4.62%. Coupled with NVIDIA announcing a significant earnings report after Wednesday's close, the large number of puts being published at this timing feels like something big is going to happen!

It should be noted that Leopold was heavily invested in AI infrastructure last Q4, and now he has switched to a full short mode. What exactly did this guy see? 🥸

🎯 First, let’s look at the top holding changes, which are as shocking as an earthquake:

📊 Q1 2026 Holdings (as of March 31):

• SMH PUT (shorting semiconductor ETF) - 14.94%, market value $2.04 billion

• NVDA PUT (shorting NVIDIA) - 11.47%, market value $1.57 billion

• ORCL PUT (shorting Oracle) - 7.84%, market value $1.07 billion

• AVGO PUT (shorting Broadcom) - 7.36%, market value $1 billion

• AMD PUT (shorting AMD) - 7.09%, market value $970 million

You are not mistaken; the top five holdings are all PUT options. To be honest, I checked this data at least more than five times!

What does this mean? Leopold is using real money to short the entire tech and semiconductor sectors. (It could also be a combination of option hedging strategies to preserve profits, but overall there are significantly more puts than calls.)

🎯 Core logic changes:

Last Q4 2025’s holding logic:

• Heavily invested in AI infrastructure: Bloom Energy (power), CoreWeave (computing power), Lumentum (optical communication)

• Core view: The bottleneck in AI development is power and computing infrastructure, not chips

• Strategy: Liquidate stocks like NVIDIA and TSMC and turn to upstream energy and data centers

Now the holding logic for Q1 2026:

• Full short on tech giants and semiconductors!

• Short list: #SMH, #NVDA, #ORCL, #AVGO, #AMD, #MU, #TSM, #ASML, #INTC

• Meanwhile, retaining some CALL options for hedging: CALLs on #MU, #SNDK, #TSM

This is a 180-degree turnaround!

🧐 My interpretation and thoughts:

Leopold’s moves signal three core messages:

1️⃣ AI bubble theory?

He may believe that current valuations of AI stocks are severely overdrawn against future expectations. Although he still believes AGI will be achieved in 2027-28, the market has already priced in this expectation.

Look at NVIDIA, AMD, and Broadcom now; what are their P/Es? The market expects perpetual growth, but Leopold may have seen the turning point.

2️⃣ Transitioning from infrastructure to shorting chips

Last Q4 his logic was: chips are not the bottleneck, power is. Thus, he liquidated chip stocks and heavily invested in energy.

Now he has taken it a step further: not only are chips not the bottleneck, but chip stocks are also severely overvalued! So he shorts them directly.

But at the same time, he retained some energy and computing infrastructure targets like BE (Bloom Energy) 6.42%, IREN (Bitcoin miner turning to AI computing) 2.93%, and CORZ (Core Scientific) 2.84%.

This shows that his long-term optimism about AI infrastructure hasn't changed; he just believes the market's pricing of chip stocks is too crazy.

3️⃣ Hedging or just shorting?

Note a detail: while shorting, he retained some CALL options:

• MU CALL - 3.09%

• SNDK CALL - 2.84%

• TSM CALL - 2.59%

This is a straddle option strategy, buying both PUTs and CALLs. He’s betting on volatility! Whether it rises or falls, as long as the price fluctuation is large enough, this strategy can make money.

But the PUT position clearly far exceeds the CALLs, indicating he leans more toward bearishness.

📉 Risks and controversies:

Leopold's operation carries immense risk:

• Time risk: Options have expiration dates. If the market does not crash significantly before the options expire, he stands to lose all his options premiums.

• Counterparty risk: He is shorting the world’s best tech companies, which have fundamentally strong performances.

• Market sentiment risk: The AI boom is still ongoing, and the Trump administration is also vigorously promoting AI development. Shorting tech stocks is akin to going against the trend.

But Leopold is a smart person, and his situational awareness is strong. I believe he sees things that ordinary people cannot.

Possible triggering factors:

• SpaceX's century IPO, expected to list in mid-June, will cause significant liquidity drain on the market.

• Peak in AI capital expenditures (the investment growth of Microsoft, Google, and Meta in AI may slow).

• Geopolitical risks (escalation of the US-China tech war, restructuring of the semiconductor supply chain).

• Macroeconomic issues (recent sharp rise in US Treasury yields. Investment banks predict the Fed will not cut rates this year and may even raise rates, bringing higher costs for AI, which has high capital expenditures).

🎯 What should we ordinary investors do?

Don't blindly copy trades!

Leopold manages a hedge fund, which allows him to implement complex options strategies, supported by a professional team for risk control.

Ordinary investors do not have this capability and resources.

But we can learn from his mindset:

• Maintain a skeptical attitude: Don’t blindly believe the narrative that "AI will always rise." Any asset has cycles, and even the best companies can experience overvaluation.

• Focus on the changes in the industry chain: From chips to energy infrastructure, structural changes are occurring in the AI industry. The bottleneck is where the investment opportunities lie.

• Ensure adequate risk hedging: If you are heavily invested in tech stocks, you may consider reducing some holdings at high points or allocating to defensive assets like gold, US Treasury bonds, or cash.

• Be long-term while trading short-term: Be optimistic about AI in the long run, but there may be significant adjustments in the short term. Set stop-losses and take profits; don’t just hold on.

In my personal view, Leopold's operation may be painful in the short term (1-3 months). If tech stocks continue to rise, his PUTs will depreciate quickly.

However, from a 6-12 month perspective, he could be right. Current market optimism about AI has reached its peak. Any negative news (like a major tech company's AI investment returns falling short of expectations, or an AI safety incident) could trigger a chain reaction.

And let’s not forget, this guy had a return of +47% in H1 2025, far surpassing the S&P 500's +6%.

He has this track record, so we should pay attention to his judgment.

Finally, to summarize:

The core signals from Situational Awareness LP’s Q1 2026 holdings are:

• Full short on tech stocks and semiconductors (7 of the top 10 are PUTs)

• Retaining AI infrastructure (energy, computing, data centers)

• Using options strategies to hedge risks, betting on significant market volatility

• Upgrading the logic from "chips are not the bottleneck" to "chip stocks are severely overvalued" This is an extremely aggressive and bold shift.

The next 2-3 months will be a key period to validate Leopold’s judgment. Let’s wait and see! 🧐

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