Federated Managed Volatility Fund II

As of 07-31-2014


  • Pursues current income and long-term growth of income.
  • Seeks to manage portfolio volatility by using equity index futures, targeting an annualized fund volatility of approximately 10%.
  • Provides a highly diversified approach to income.
  • Invests in high yielding stocks of undervalued mid- to large-cap companies that are likely to maintain and increase their dividends.
  • Invests in diversified bond sectors that include U.S. government, investment-grade corporate and mortgage-backed, high-yield corporate, and international developed and emerging market.
  • Balances income opportunities and risk across markets and sectors through active management.

Key Investment Team


Fund Number(s)   333
CUSIP   313916108
Benchmark   40% Russell 1000 Value Index/20% Barclays High Yield 2% Issuer Capped Index/20% Barclays Emerging Market Bond Index/20% Barclays Mortgage-Backed Securities Index
Performance Inception Date   02-10-1994
Fiscal Year-End   12-31

Morningstar Ratings™

disclosures »
    Funds in Category
Overall 565
3 Year 565
5 Year 477
10 Year 253
Based on risk adjusted total return. The overall rating is derived from a weighted average of the fund’s three-, five-, and ten-year average annual returns, as applicable.

Morningstar Category & Style

disclosures »
Category Conservative Allocation

The fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional instruments.

There are no guarantees that dividend-paying stocks will continue to pay dividends. In addition, dividend-paying stocks may not experience the same capital appreciation potential as non-dividend-paying stocks.

Effective December 2, 2011, the fund's name was changed from Federated Capital Income Fund II to Federated Managed Volatility Fund II and the Adviser will use derivative contracts, including stock index futures to target an annualized volatility level for the Fund of approximately 10%. However, the actual or realized volatility for any particular period may be materially higher or lower depending on market conditions.

Volatility is a statistical measurement of the frequency and level of changes in the value of an asset, index or instrument without regard to the direction of those changes. Volatility may result from rapid and dramatic price swings. There can be no guarantee that the Fund will maintain its annualized volatility target. Furthermore, while the volatility management seeks competitive returns with more consistent volatility of returns, the attainment and maintenance of the target volatility does not ensure that the Fund will deliver competitive returns.

Bond prices are sensitive to changes in interest rates, and a rise in interest rates can cause a decline in their prices.

International investing involves special risks including currency risk, increased volatility, political risks, and differences in auditing and other financial standards. Prices of emerging-markets securities can be significantly more volatile than the prices of securities in developed countries, and currency risk and political risks are accentuated in emerging markets.

High-yield, lower-rated securities generally entail greater market, credit/default and liquidity risks and may be more volatile than investment-grade securities.

Fund shares are available exclusively as a funding vehicle for life insurance companies writing variable life insurance policies and variable annuity contracts.  If you are an individual investor, contact your financial advisor or insurance company for more information on these products.

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.

"Category" product classifications noted at the top are Federated's internal classifications.

For additional information, including definitions of related terms and indexes, see the Financial Glossary and Benchmark Index Glossary.

Federated Securities Corp., Distributor
Not FDIC Insured May Lose Value No Bank Guarantee
Copyright © 2014 Federated Investors, Inc.

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