Hedge fund VARA falls 33 per cent in October as AI stocks decline
Value Aligned Research Advisors remains up 13 per cent for the year despite significant losses in its artificial intelligence focused portfolio.
Value Aligned Research Advisors (VARA), a hedge fund focused on artificial intelligence (AI) stocks, tumbled 33 per cent in October, according to a report by Mint.
The firm, which operates a portfolio similar to Leopold Aschenbrenner’s Situational Awareness, told investors with Class C shares that the fund is still up 13 per cent for the year, a person familiar with the matter said.
The decline follows a period of volatility where the Nasdaq 100 Index fell 6.7 per cent in October. The Philadelphia Semiconductor Index, which includes Nvidia Corp., Intel Corp. and Advanced Micro Devices Inc., fell 12 per cent on Thursday.
In a letter to investors on Thursday, VARA stated that the broader equity market and the AI sector experienced extreme volatility in November. The firm said it remains healthy and stable, maintaining excess margin and managing the portfolio at the low end of its historical leverage range.
The fund previously saw a 44 per cent plunge in July. During that period, the firm was forced to unwind trades and sell holdings in publicly traded AI companies to Citadel at a discount following margin calls.
A representative for the Princeton, New Jersey-based VARA declined to comment on the matter.
