Federated MDT Large Cap Growth Fund (IS) QILGX

Share Classes Product Type Asset Class Category
Mutual Fund Equity Large Cap
As of 09-30-2017

Highlights

  • Market preferences shifted during the quarter from growth to value and large cap to small cap
  • Strong growth-oriented stocks contributed to performance

Looking back

Just as in the second quarter of this year, the third quarter brought low positive returns (the Russell 3000 Index returned 4.57%) but a varying market environment. Large-cap stocks led small-cap stocks in the first two months of the quarter, but small caps did very well in September and ended the quarter just ahead of the large caps (the small-cap Russell 2000 Index returned 5.67% during the quarter while the mega-cap Russell Top 200 Index returned 4.88%). On the style front, growth stocks outperformed value stocks in July and August, but value stocks offset part of the growth advantage in September (for the quarter, the Russell 3000 Growth Index returned 5.93% and the Russell 3000 Value Index returned 3.27%).

Performance

Federated MDT Large Cap Growth Fund Institutional Shares returned 6.32% in the third quarter of 2017, outperforming the 5.90% return of its benchmark, the Russell 1000 Growth 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.

Performance Contributors

  • Strong growth stocks, including those with very high analyst conviction and prices near 52-week highs
  • Security selection in Information Technology and Health Care sectors
  • Strongest relative performers: Lam Research Corporation, Applied Materials, Inc. and Align Technology, Inc.

Performance Detractors

  • Stocks with low analyst conviction and worsening earnings to price
  • Security selection in Industrials sector
  • Weakest relative performers: Microsoft Corporation, which was underweighted, Boeing Company, which was not held, and Alphabet Inc., which was not held

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

Looking ahead

The fund ended the third 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 an underweight in Real Estate (the fund does not hold REITs). Within the GICS sectors, there were overweight positions in the retailing and semiconductors and semiconductor equipment industries. There were underweight positions in the consumer services and real estate industries.