FRM Capital Advisors (FCA), the hedge fund seeding division of Financial Risk Management, and Varna Capital have formed a strategic relationship which involves FCA making a significant investment in Varna's first fund.

Following the signing of the strategic relationship, Varna is expected to launch its first fund during the fourth quarter of 2010.

Varna is a newly formed hedge fund manager based in New York and headed by Svetlana Lee. Ms Svetlana, together with the Varna team, previously managed an equity long-short fund at Citadel’s PioneerPath new manager platform.

Clive Peggram, CEO of FCA, said: “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.

‚ÄúSvetlana is one of the most talented new equity long-short managers in the industry and we are very pleased to form a strategic relationship with her new firm and to support its development.”