When Leverage Goes Wrong on Wall Street

In this occurrence of Motley Fool Hidden Gems Investing, Motley Fool contributors Travis Hoium and Lou Whiteman, on with Motley Fool expert Jason Moser, discuss:

• Situational Awareness.

• Leverage gone wrong.

• Hyperscaler divergence.

• Would you rather?

• Tesla successful China.

• Stocks connected our radar.

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A afloat transcript is below.

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This podcast was recorded connected July 31, 2026.

Travis Hoium: No borderline calls for the adjacent hour. Motley Fool Hidden Gems Investing starts now. Welcome to Motley Fool Hidden Gems Investing. I'm Travis Hoium, joined contiguous by Lou Whiteman and Jason Moser. Guys, we've got to commencement with the quality of the week. Lou, that is Situational Awareness, getting a borderline call. The blistery capitalist of 2026 is present retired of the equity markets. What successful the satellite happened?

Lou Whiteman: Let's speech astir this due to the fact that this is fun. First of all, Situational Awareness, AI-focused hedge money founded by, I anticipation I'm saying this right, Leopold Aschenbrenner, I deliberation it is. Now, Leopold has a heck of a past already. It's astir similar the Forrest Gump communicative here. All close guys, He was astatine FTX with Sam Bankman-Fried. He was astatine OpenAI, and past helium went off, and helium really conscionable wrote, I deliberation it was a Substack oregon something, talking astir situational awareness, fundamentally that AI was going to devour the world. Got a batch of buzz, and helium turned it into a hedge fund. His hedge fund, aforesaid name, Situational Awareness, focused connected AI bets, and arsenic the tide was rising, truthful excessively did his portfolio. The money borrowed heavy to multiply its returns. We don't cognize precisely however much, but we cognize this due to the fact that the funds instrumentality were amended than the underlying assets that it was buying successful presumption of their returns, truthful there's evidently leverage. At its peak, it soared from a mates 100 cardinal to 20 cardinal successful assets, up 440% successful the archetypal fractional of the year.