As of 12-31-2017

Highlights 

  • Market preferences shifted during the quarter from growth to value
  • Strong growth-oriented stocks contributed to performance
  • Fund ended quarter roughly sector neutral to benchmark

Looking Back

The fourth quarter of this year was another good quarter for the domestic equity market (the Russell 3000 Index returned 6.34%). The market was changeable (just as in the third quarter), as market participants watched Congress and tried to anticipate which companies would be favored in the final tax bill. While the month of September had been strongest for small-cap value stocks, October was strongest for large-cap growth stocks. November was then neutral, style-wise—every one of the indexes inside of the Russell 3000 returned about 3%. In December, large cap was favored over small cap, and value was favored in the large caps and growth was favored in the small caps. At the end of the fourth quarter, all indexes in the Russell 3000 family were positive for the quarter, with the large-cap Russell Top 200 Growth Index leading with a return of 8.02%, and the small-cap Russell 2000 Value trailing, at 2.05%.

Performance

Federated MDT All Cap Core Fund R6 Shares returned 6.80% in the fourth quarter of 2017, outperforming the 6.34% return of its benchmark, the Russell 3000 Index.

Performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than what is stated. Other share classes may have experienced different returns than the share class presented. To view performance current to the most recent month-end and for after-tax returns, click on the Performance tab.

Click the Performance tab for standard fund performance.

Click on the Portfolio Characteristics tab for fund’s top 10 holdings.

Performance Contributors

  • Strong growth stocks with very high analyst conviction and prices near 52-week highs
  • Value stocks with high tangible book-to-price and above-average structural earnings
  • Security selection in Industrials and Financials sectors
  • Relatively strong performers overweighted by the Fund: Align Technology, Inc., Deere & Company, AutoZone, Inc. and Intel Corporation

Performance Detractors

  • Stocks with moderate analyst conviction and not-high structural earnings
  • Security selection in Information Technology sector
  • Relatively weak performer overweighted by the Fund: Celgene Corporation
  • Relatively strong performers not held by the Fund: Microsoft Corporation and Amazon.com, Inc.

How We Are Positioned

The fund ended the fourth quarter roughly sector-neutral to the benchmark, according to the Thomson Reuters I/B/E/S-based sector definitions used for the strategy. According to the GICS sectors, there was an overweight in Information Technology and underweights in Real Estate (the fund does not hold REITs), Consumer Discretionary and Industrials. Within the GICS sectors, there were small overweight positions in the food, beverage & tobacco, semiconductor and semiconductor equipment and banks industries. There were underweight positions in the real estate and diversified financials industries. At the end of the period, the fund had equal weight in value and growth stocks.