Ken Griffin’s Citadel LLC and Citadel partners are planning to redeem roughly $500m of the $2bn they put in Melvin Capital Management after Melvin got slammed by bad short bets on GameStop and other soaring stocks, said people familiar with the matter.

Citadel and Steven A Cohen’s Point72 Asset Management together invested $2.75bn into Melvin’s hedge fund on 25 January as Melvin was haemorrhaging money. In return for the rare intra-month investments, the two firms received non-controlling revenue shares in Melvin for three years. The arrangement means they share in the management and performance fees that Melvin collects from its clients over that time but don’t get any control over Melvin or its investments.