In this article, we're going to take a closer look at Federated Mutual Funds, also known as Federated Funds. The Federated family is known for producing top performing mutual funds, which are aimed at the institutional as well as the individual investor. Let's see if that holds true in this review.
Federated Family of Funds
Federated Investors has been servicing the financial community since 1955, and serves investors both in the United States and around the world. Federated is one of the top ten mutual fund families, with approximately $502 billion in assets under management (September 2019). Federated offers investors nearly 135 domestic and international equities, fixed income, and money market mutual funds.
Federated supports their clients through a network of 6,100 financial intermediaries and institutions. They also field a team of 150 investment experts. Through this network of professionals, Federated can also provide customized account management services to high-net-worth individuals. Federated offers a well rounded portfolio of solutions including 401(k) plans, Roth and Traditional IRAs, and "bundled" retirement plans.
In recent years, Federated acquired over $19 billion in assets from Alliance Capital Management, $265 million in assets from Banknorth Investment Advisors, $6.7 billion from MDT Advisors, as well as assets of Prudent Bear Funds, Clover Capital Management, SunTrust Banks, Hilliard-Lyon and Rochdale Atlas. In 2003, Federated was added to Standard and Poor's 500 Index.
Fee Structure and Returns
Morningstar ratings indicate the expense ratios for mutual funds at Federated range from Above Average for their domestic stock funds (1.30%) to Average for their municipal bond funds (0.85%). Federated offers investors a fairly nice choice of asset classes, with taxable bond funds (28.85%), and domestic stocks (43.59%) comprising most of that mix.
The minimum individual investment is $1,500, although some institutional funds have minimum investment requirements as high as $1,000,000. Like PIMCO Mutual Funds, Federated offers investors a mix of load funds (32.60%) and no-load mutual funds (67.40%). As of September 2019, the average return on the family of funds at Federated was 5.26% over the last five years.
Top Rated Federated Mutual Funds
The top rated mutual funds at Federated offer investors a nice mix of government bond funds, international stocks, and a conservative securities portfolio. None of the three funds carry a front load meaning all money is put to work right away. That said, below is a list of the top rated mutual funds from Federated:
Federated Instl High Yield Bond Instl (FIHBX)
Assets: $6.8 million
Category: US Fund High Yield Bond
Specialty: None
Top Three Holdings: Hub International Limited 7%, Jaguar Holding Co II/Pharmaceutical Product Development LLC 6.38%, ALTICE FRANCE S.A 7.38%
Load: None
Minimum Investment: $1 million
Expense Ratio: 0.50%
5-Year Average Return: 5.72%
Federated High-Yield Strategy (FHYSX)
Assets: $43.2 million
Category: US Fund High Yield Bond
Specialty: None
Top Three Holdings: High Yield Bond Portfolio, Bank of America (Repo), USD
Load: None
Minimum Investment: $0
Expense Ratio: 0.030%
5-Year Average Return: 6.21%
Federated Kauffman Small Cap (FKASX)
Assets: $3.5 billion
Category: Small Growth
Specialty: None
Top Three Holdings: argenx SE ADR, argenx, Azul SA ADR
Load: None
Minimum Investment: $1,500
Expense Ratio: 1.37%
5-Year Average Return: 17.62%
Additional Resources
In this article, we're going to discuss AIM Mutual Funds. As we've done in previous articles in this series, we're going to first provide some information on the overall family of funds from AIM Investments. Next, we're going to discuss their mutual fund fee structure. Finally, we'll finish up with a listing of the top three performing mutual funds available from AIM.
Moneyzine EditorJanuary 5th, 2024
The next family of funds that we are going to discuss, as part of this ongoing series, is American Mutual Funds. In this article, we're going to first provide some background information on American Funds. Next, we'll briefly discuss American's fee structure and investment returns. Then we'll finish up with a list of the top-rated American mutual funds in 2019.Moneyzine EditorJanuary 5th, 2024
Fidelity Mutual Funds is the next family of funds we're going to discuss in this series. We'll start that discussion with a brief history of Fidelity. Next, we'll talk about their fee structure. Finally, we'll identify some of their top performing mutual funds.Moneyzine EditorJanuary 18th, 2024
Franklin Mutual funds bears the name and image of one of America's greatest citizens. In this article, we're going to provide a review of this company to see if it lives up to the legacy he's left behind. We're also going to take some liberties with the name of this mutual fund, since the company's formal name is Franklin Templeton Investments.Moneyzine EditorJanuary 18th, 2024
In this article, we'll be reviewing Hartford Mutual Funds, which is a very well-known name in the insurance industry too. The insurance and investment services industry is skilled at managing money, which means there is a good fit for these same companies to offer investors the opportunity to purchase mutual funds too.Moneyzine EditorJanuary 19th, 2024
