Following a year of record losses, Element Capital Management, the global macro hedge fund firm founded by Jeffrey Talpins is planning to downsize its operation in terms of external investments and run mainly in-house capital, according to a report by Bloomberg.

The report cites a unnamed person with knowledge of the matter as revealing that the firm the New York-based firm informed clients on Wednesday that it intends to return an undisclosed sum to investors and focus on generating higher returns while managing fewer assets.

According to Bloomberg's source, the firm is also planning to reduce the firm's roster of external investors as part of the plan for internal cash to account for the majority of its assets.

Element, which has been closed to new money since 2018, lost about 10% last year on the back of losses in the previous two years and has seen assets sink to about $8.5bn from a peak of $18bn. The fund reportedly gained 5.3% in January.