July 2026 AI & Alt Data Roundup: The AI Unwind

BattleFin Montauk kicks off August 10th & 11th with an amazing AGENDA including top leaders from Anthropic, OpenAI, Perplexity and others discussing AI & Data on the Edge.

Global hedge funds entered July having just posted their strongest first-half performance since 2021, with average returns of 7.2% through June 30 and industry AUM hitting a record $5.6 trillion in Q2 — the 15th consecutive quarterly expansion, and the strongest quarterly performance of the decade.

Then the floor fell out.

A sharp mid-July unwinding of crowded AI-linked trades inflicted the worst quant drawdown since 2023, triggering margin calls at Goldman Sachs and JPMorgan and wiping $797 billion from the Magnificent Seven in a single session. Against that backdrop, sovereign capital continued its steady march toward the industry — Singapore's GIC pledging $30 billion over three years — while central banks held rates steady and Warsh's Fed signalled it was in no hurry to shift course. The bifurcation between AI bulls who sidestepped the unwind and those who did not is shaping to be July's defining story.

Buy Side Performance & News

Hedge funds recorded their strongest first half since 2021, averaging 7.2% returns through June 30 according to HFR, with global AUM hitting a record $5.6 trillion in Q2 — up $409 billion and marking the 15th consecutive quarterly expansion. The quarter itself was described as the strongest quarterly performance of the decade, driven by AI-linked equities, IPO activity, and broad macro tailwinds before the mid-month reversal.

The mid-July AI unwind delivered the worst quant drawdown since 2023 as crowded positions in AI-linked equities unwound sharply. Goldman Sachs and JPMorgan issued margin calls on leveraged AI positions, and the Magnificent Seven shed $797 billion in a single session. Quant strategies bore the brunt, while discretionary managers with more diversified books largely sidestepped the worst of the damage.

Citadel reported broad H1 gains led by its tactical trading and equities businesses, and notably avoided the worst of the mid-July quant selloff. Whale Rock Capital Management was among the cycle's biggest winners, posting +72.5% year-to-date on concentrated AI and semiconductor bets. Lone Pine Capital gained +43% in H1, and Coatue Management added +24.5% year-to-date.

Viking Global Investors acknowledged that its conservative stance on AI valuations cost it first-half performance — the firm gained just 2.6% in H1 — and confirmed it is still resisting what it views as stretched AI multiples. The fund's disciplined positioning stands in contrast to peers who rode the AI trade higher but faced significant drawdowns in July.

Millennium Management is seeking a record $20 billion capital raise — the largest in the multi-manager platform's history. The firm generated approximately $4 billion in a single month from the SpaceX Nasdaq 100 index rebalancing trade and is opening a new office in São Paulo as it deepens its emerging markets presence.

Man Group reported record assets under management of $253.6 billion following strong H1 inflows and performance across its quant and discretionary strategies.

Bobby Jain's Jain Global posted +3.2% in June and stands at +3.9% year-to-date in only its second year, a steady if unspectacular trajectory for the high-profile launch.

Situational Awareness, Leopold Aschenbrenner's AI-focused fund, is seeking fresh capital after suffering sharp losses in the mid-July AI stock selloff — a notable setback for one of the cycle's most prominent AI-conviction shops. Meanwhile, GIC, Singapore's sovereign wealth fund, announced it is pledging $30 billion to hedge funds over the next three years, with a preference for global macro, quant, and multi-strategy managers.

Meridiem Capital Partners has rebuilt to $1.6 billion in AUM with backing from Schonfeld Strategic Advisors, more than two years after losing its $1.5 billion anchor investment from Millennium Management. Deem Global secured a $1 billion commitment from Abu Dhabi Investment Council (ADIC), one of the larger sovereign allocations to an emerging manager this year.

Short sellers are building record bearish positions in US equities despite the powerful rally, with concerns centred on AI earnings durability and China competition. Hedge funds simultaneously ramped up their most bullish Brent crude bets in nearly a decade according to ICE Futures Europe data. Trump Media and Truth Social drew attention after reportedly pitching hedge funds on a $100,000-per-month subscription for faster access to Trump posts.

Michael Burry's AI short calls are generating a "Buffett effect" — his pronouncements now capable of triggering the very moves he is positioning for. Goldman Sachs reported a Q2 earnings beat driven by a trading surge and renewed dealmaking; prime brokerage divisions across Wall Street are booking record revenues. Specialist hedge funds — equity long/short and event-driven — outperformed large multi-strats in H1. CME Group revived single-stock futures in the US and launched its Treasury Link tool to streamline the basis trade workflow for its clients.

Activist Investor Corner

Elliott Management settled its campaign against Align Technology (maker of Invisalign), securing three new independent board seats without a proxy fight. Saba Capital Management built a new stake in UK student accommodation provider Unite Group and raised its stake in Workspace Group to 28.2% ahead of an AGM boardroom showdown, continuing its pattern of activist pressure on UK-listed real estate names.

Funds Launches, Closings, Redemptions and Asset Raising

Carronade Capital Management announced it will close to new investors by the end of 2026, having grown to approximately $3.7 billion AUM.

King Street Capital Management tightened redemption terms, moving investors seeking to exit the main fund into a separate liquidating vehicle.

Cinctive Capital Management opened a new West Palm Beach office and hired two veteran portfolio managers covering healthcare and technology sectors.

Qube Research & Technologies is launching its first internally managed discretionary equity portfolio management team, extending beyond the firm's quantitative roots.

RQI Investors launched the RQI Global Fund, a UK UCITS vehicle for its flagship global value strategy.

Regulatory, Compliance and Legal

The US Treasury issued a warning on so-called "tax alpha" strategies, noting that more than $90 billion has flowed into these vehicles over the past 18 months. The strategies use quantitative loss-harvesting techniques to generate tax benefits while maintaining broad market exposure — a structure the Treasury views as aggressive tax arbitrage warranting closer scrutiny.

The Bank of England is moving forward with proposals to limit hedge fund leverage in UK gilt markets, following its earlier work on systemic risk in the government bond market. Separately, the BoE warned that AI is becoming a growing source of financial system risk, flagging elevated market expectations, growing leverage tied to AI positions, and escalating cyber threats as the primary channels of concern.

The SEC issued new guidance requiring activist investors filing Schedule 13D disclosures to reveal the identities of campaign backers — a move targeting the practice of funding proxy campaigns through undisclosed third-party arrangements.

China's securities regulators signalled tighter oversight of quant funds and AI-driven trading strategies following losses in domestic markets tied to algorithmic activity.

BlueCrest Capital Management lost its UK Supreme Court appeal in a £200 million tax dispute over the application of salaried members rules to its partnership structure — a ruling expected to influence how hedge fund partnerships are structured across the industry.

Translunar Crypto co-founder Justin Ryan Schmidt was sentenced to 37 months in prison for tax evasion.

Japan's ruling LDP party is preparing tougher enforcement of activist investor disclosure rules.

Deccan Value Investors publicly challenged the SEC's 2022 enforcement findings against the firm following the repeal of gag rules that had previously prevented it from doing so.

Data Insights & News

BattleFin published three new whitepapers on the topic of how alternative data and AI signal advantages are reshaping sectors including CPG, Retail, and Restaurants. Each industry is evolving their formulas for success and growth with the emergence of a more widely accessible intelligence layer. These reports reveal developing trends that both corporate brands and institutional investment organizations want to keep a pulse on–with more insights slated for featuring at our Discovery Day New York Fall event on October 29th.

Similarweb published a white paper titled Calibrated Ticker Mapping, exploring calibrated web traffic as an orthogonal signal for systematic investing. The paper presents a market-neutral backtest examining latency, portfolio construction, and data quality considerations for alpha extraction from web traffic data. (White paper available on request)

Datos, a Semrush Company, released its report How AI Is Reshaping Customer Journeys: ChatGPT still leads at ~44% EU/UK and 38% US share; Gemini has tripled its share; e-commerce overtook Education as the top AI referral category; and Amazon AI sessions ending in purchase have approximately doubled year-over-year. The report includes case studies across Samsung TV, Wegovy, Dell, and Sephora.

Kadoa published a blog post examining how cheap AI-generated code is changing the build-vs-buy calculus for web data at investment funds. The piece argues that while writing a simple scraper has become trivially cheap, operating hundreds of them at scale has not — and walks through which parts of the data pipeline funds should still own versus outsource.

Insig AI expanded its central bank dataset to 99 central banks — up from 78 in June — with video, audio, and text coverage in 35 languages, delivered via MCP within minutes of release.

Advan Research shared three research briefs covering a QSR sector update, a telco earnings wrap-up (flagging fewer iPhone upgrades ahead), and a deep-dive on Pentair's earnings miss.

EquiLend Data & Insights reported that global securities lending revenue reached a record $9.1 billion in H1 2026 — up 34% year-over-year — as elevated market volatility and short-selling demand drove loan balances to a record $4.38 trillion. Equity lender revenue rose 38% to $5.43 billion, led by AI volatility, biotech catalysts, and APAC tech demand; fixed income lending rose 22% to $1.57 billion, driven by a 30% surge in US Treasury activity. Data accessible on Bloomberg Terminal via APPS ORBISA <GO>.

INRIX released its latest Signals Scorecard, showcasing how connected vehicle and mobility data can serve as leading indicators of economic activity. The scorecard evaluates the performance of INRIX signals across key sectors and use cases, highlighting how transportation patterns can provide early insight into changes in consumer behavior, freight movement, travel demand, and regional economic activity

Beyond Countdown has published a structured governance reading of eight AI and technology organisations using a single 38-risk framework applied to the public record. Data-centre energy risk (LGR-16) is concentrated in a handful of institutions — in a frozen portfolio analysis of 518 organisations (5 June 2026), only 9 were rated Red for data-centre energy; eight of those nine sat in the technology sector. Microsoft and OpenAI are among them.

Datos, a Semrush Company released State of Search Q1 2026. Drawing on clickstream data from tens of millions of desktop users across US, EU, and UK (Jan–Mar 2026): traditional search still dominant but essentially flat; AI tools up from 1.31% to 1.65% share of desktop events in the US. Google AI Mode adoption more than doubled in Q1 (2.5x in the US), though under 0.2% overall. Zero-click search continued to decline; organic click-through rising to 44.9% in the US. ChatGPT remains dominant (~35% US, ~45% EU/UK) but Claude posted the sharpest quarter-over-quarter growth, more than doubling its share in both regions

Datago explores how alternative data is reshaping stock network analysis. The research introduces Datago's approach to building stock networks from investor forum co-mentions, providing an alternative perspective on company interconnectedness based on collective investor attention and discussion. Potential applications for quantitative research, factor discovery, and market structure analysis.

New Product Launches

Dataplor relaunched its global location intelligence platform around agentic AI, enabling plain-language queries across its 370M+ places, 15,000 brands, and 250-country dataset. Users can ask natural-language questions and receive instant answers through an interactive global map interface, with raw data export available alongside the conversational layer.

Nasdaq launched its Connected TV Advertisement Impressions (CTVAD) dataset — daily DMA-level ad impressions covering Digital, Cable, and Broadcast TV across the US, delivered in six tables including ad details, viewing panel, media panel, and advertiser/publisher ISIN mapping.

Hatched Analytics added RDDT (Reddit) data to its coverage — Ad Transactions, Comments, and Posts indices delivered globally at weekly T+0. The firm reports a 2% six-quarter average error on Reddit's logged-in DAU metric.

MarketPsych launched Trending Themes, a daily data feed that detects statistically significant surges in global media coverage and maps each emerging theme to sentiment, relevance, and urgency scores across 145,000+ entities. The feed uses a multi-stage NLP + LLM pipeline — classical NLP for surge detection, a generative AI layer for theme labeling and narrative summaries — and delivers structured JSON/CSV via REST API with history back to 2005. (Press release available on request)

Particle Podcast Intelligence provides structured podcast intelligence from more than 120,000 fully transcribed, speaker-diarized shows, with every episode mapped at the segment level to the companies, people, and topics being discussed. Funds use it to track word-of-mouth on brands, executives, and products before it reaches traditional media, and to follow executive commentary from podcast appearances.

Babbl Labs has launched 2 new YouTube products for a total of 3 driven by our HF clients. Tripwire — real-time alerts the moment an exec, analyst, or influencer says something market-moving on YouTube (3hr max lag). Knowledge Base — a curated, entity-annotated transcript corpus built to feed directly into LLM research and retrieval workflows. Extended — our largest historical dataset: 25,000+ channels, 750K+ videos, 6 years backfilled, for teams wanting full-scale coverage.

Pyth Indices introduces the first 24/7 consumer-facing financial index products, built for markets that never close. Powered by institutional market data from the world's most liquid trading venues, delivering continuously updated index values across equities, commodities, FX, precious metals, ETFs, and thematic baskets. Already live on Coinbase, Kraken, and dYdX. Provides infrastructure for tokenized assets, perpetual futures, prediction markets, and other always-on financial applications.

ExtractAlpha launches Transcripts AI Model - which uses advanced AI to analyze earnings call transcripts, transforming management commentary and Q&A into daily stock-level alpha signals for global equities. Captures contextual language patterns beyond traditional sentiment analysis to help investors identify differentiated investment opportunities.

Exchange Data International launches the Central Banks Meeting Calendar. It consolidates global monetary policy meeting schedules, interest rate decisions, and press briefing timings into a single source.

Upcoming Events

BattleFin "Data on the Edge" — August 10-11, Montauk, NY. BattleFin's signature summer event is coming to Montauk for two days of Immersive AI sessions, panel discussions, and networking between hedge funds, asset managers, and alternative data vendors. Set against the backdrop of the East End, Data on the Edge is designed for focused deal-making in an intimate setting — a deliberate contrast to the larger conference circuit

Datos Pulse of the Web: A live webinar on the AI customer journey traditional attribution can’t see on Sep 12th.

BattleFin Discovery Day London Oct 01 — Chancery Rosewood, London. BattleFin's UK edition brings the Discovery Day format — structured vendor-to-buyside meetings, live product demos, and curated networking — to one of London's premier venues.

BattleFin New York Fall October 29th — New York Athletic Club, New York, NY. The flagship autumn Discovery Day returns to New York for the full one-day format, connecting alt data and analytics vendors with Private Equity firms, Corporates, US-based hedge funds and asset managers ahead of Q4.

Contact us at info@battlefin.com if you would like to contribute to this newsletter or need more info on any of above.