FRM Capital Advisors, the hedge fund manager of Financial Risk Management, has partnered with Varna Capital to make a “significant” investment in Varna’s first fund due to launch in the final three months of this year, it said yesterday.

Varna Capital is a newly formed hedge fund manager based in New York, headed by Svetlana Lee. The company uses an equity long-short strategy and most recently managed an equity fund at Citadel’s manager platform, PioneerPath. As for Lee, she gained experience while working at hedge fund managers Greenlight Capital, The Baupost Group, and Perry Capital.

“The long-term performance characteristics of fundamental equity long-short strategies are very attractive, and we look forward to bringing this opportunity to our investors. We believe that the current market is an attractive environment for this strategy and the prospects will remain strong for the foreseeable future” said Clive Peggram, chief executive officer at FCA.

The acquisition of Varna Capital marks FCA’s sixth investment since 2008. The company currently manages about $8.5 billion worldwide for investors.

(To view a recent article by FRM Capital Advisors on the issue of hedge fund seeding, click here).