AI Fund Unaudited Monthly Return Drops 67% Amid Bank Run Risk

Fund eliminates all leverage and closes shorts to halt bank-run dynamics, reporting -67% monthly loss but +80% annual return while maintaining hybrid structure.

Woofun AI reports that an AI-focused fund disclosed an unaudited monthly cumulative net return estimate of -67%, contrasting with an annual cumulative net return estimate of +80%. The fund faced severe pullbacks in July as core AI holdings dropped by half or more, triggering a dynamic described as a bank run where vulnerability exacerbated liquidity issues.

To protect limited partners, the fund executed block trades to eliminate all leverage, closed all short positions, and ceased portfolio financing. The manager stated the fund remains open as a hybrid public and private entity, now managing a fully funded portfolio with no margin or liquidation risks. Future operational changes regarding risk management and oversight are planned.