Federated Prudent Bear Fund is a short-biased equity fund managed to outperform in a declining stock market. Beyond delivering upside potential in down markets, the fund may also provide a measure of portfolio defense at any time, during any market cycle.

Federated Prudent Global Income Fund offers you a way to broaden your investment horizons through its strategic exposure to quality foreign bonds as well as precious metals and mining stocks. Seeking income and capital appreciation, the fund is designed to perform inversely to the U.S. Dollar.

David W. Tice, Federated’s chief portfolio strategist for bear markets, has been at the forefront of bear market investing for more than 20 years. To learn more about David’s background, visit his biography.

The Federated Prudent Bear Fund is the successor to the Prudent Bear Fund and Federated Prudent Global Income Fund is the successor to the Prudent Global Income Fund, pursuant to a reorganization that took place on December 5, 2008. Prior to that date, the funds had no investment operations.

A Few Words about Risk

Federated Prudent Bear Fund regularly makes short sales of securities, which involves unlimited risk including the possibility that losses may exceed the original amount invested. The fund may also use options and future contracts, which have risks associated with unlimited losses of the underlying holdings due to unanticipated market movements and failure to correctly predict the direction of securities prices, interest rates and currency exchange rates. However, a mutual fund investor’s risk is limited to one’s amount of investment in a mutual fund. The fund may also hold restricted securities purchased through private placements. Such securities may be difficult to sell without experiencing delays or additional costs. The prices of gold and other precious metals may be subject to substantial price fluctuations over short periods of time and may be adversely affected by unpredictable international monetary and political developments. Please see the prospectus for further details. Considering the increased risks, the fund may not be suitable for all investors.

Federated Prudent Global Income Fund invests in foreign securities which will involve greater volatility and political, economic and currency risks and differences in accounting methods. The fund may also invest in gold and precious metals, which involves additional risks, such as the possibility of substantial price fluctuations over a short period of time. Please see the prospectus for further details. Considering the increased risks, the fund may not be suitable for all investors.

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

Past performance is no guarantee of future results.

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