(Reuters) – Melvin Capital Management will shrink from its $8.7billion in March to $5 billion. This is to make it more agile and seek higher returns.

Melvin, who lost almost $7 billion in the early part of last year on bets like GameStop, (NYSE:), would fall, has set a target size between $4.5 billion and $5 billion. He also told investors that it should keep its maximum total assets under management between $6.5 and $7 billion through June 2027. However, this threshold can change.

According to a source, Melvin plans to return capital every 90 days to investors if it exceeds $7 billion.

Gabe Plotkin (the founder of Melvin) had bet since 2014 that GameStop share prices would fall as people move away from this brick-and-mortar video store’s products.

However, retail investors formed a group to support GameStop. It soared by more than 2500% in January 2021. Plotkin closed his short position in the meme stock by the end of the month. However, the hedge fund had lost 39% last fiscal year.

The source stated that Melvin plans to collect fees from 15% to 25% in this new arrangement, down from its performance fee which was 20% to 30%.

The Wall Street Journal reported and CNBC earlier about the restructuring.