Floating-Rate Securities

Floating-rate securities offer the unique benefit of generating income that keeps pace with changes in market interest rates, making them particularly beneficial when rates are rising. Floating-rate debt may include corporate, municipal and asset-backed securities, and adjustable-rate mortgages as well as trade finance and senior bank loans, both investment grade and non-investment-grade.

What are the potential benefits?

  • Pegged to prevailing short-term rates and reset every 30-90 days
  • Provide  income potential that's competitive with longer-duration fixed- income options
  • Loans are secured by company assets or financed goods 
  • Historically low correlation to other fixed-income investments

What does Federated offer in this category?

Investors should carefully consider the fund's investment objectives, risks, charges and expenses before investing. To obtain a summary prospectus or prospectus containing this and other information, contact us or view the prospectus provided on this website. Please carefully read the summary prospectus or prospectus before investing.
Past performance is no guarantee of future results.
Mutual funds are subject to risks and fluctuate in value.
Variable and floating-rate loans and securities generally are less sensitive to interest rate changes but may decline in value if their interest rates do not rise as much or as quickly as interest rates in general. Conversely, variable and floating-rate loans and securities generally will not increase in value as much as fixed-rate debt instruments if interest rates decline.
In addition to the risks generally associated with debt instruments, such as credit, market, interest rate, liquidity and derivatives risks, bank loans are also subject to the risk that the value of the collateral securing a loan may decline, be insufficient to meet the obligations of the borrower, or be difficult to liquidate.
Federated Securities Corp., Distributor
Copyright © 2015 Federated Investors, Inc.

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