Mutual Fund Summary Prospectus (497k)
December 28 2012 - 1:28PM
Edgar (US Regulatory)
Summary
Prospectus
December
31, 2012
Share Class
|
Ticker
|
A
|
SVAAX
|
C
|
SVACX
|
Institutional
|
SVAIX
|
Federated Strategic Value Dividend Fund
A
Portfolio of Federated Equity Funds
Before you invest, you may want to review the Fund's Prospectus, which contains more information about the Fund and its risks. You can find the Fund's Prospectus and other information about the Fund,
including the Statement of Additional Information and most recent reports to shareholders, online at FederatedInvestors.com/prospectus. You can also get this information at no cost by calling 1-800-341-7400 or by
sending an email request to services@federatedinvestors.com or from a financial intermediary through which Shares of the Fund may be bought or sold. The Fund's Prospectus and Statement of Additional Information, both
dated December 31, 2012, are incorporated by reference into this Summary Prospectus.
A
mutual fund seeking to provide income and long-term capital appreciation by investing primarily in income-producing value stocks.
As
with all mutual funds, the Securities and Exchange Commission (SEC) has not approved or disapproved these securities or passed upon the adequacy of this Prospectus. Any representation to the contrary is a criminal
offense.
Not FDIC
Insured • May Lose Value • No Bank Guarantee
Fund Summary
Information
Federated Strategic
Value Dividend Fund (the “Fund”)
RISK/RETURN
SUMMARY: INVESTMENT OBJECTIVE
The
Fund's investment objective is to provide income and long-term capital appreciation.
RISK/RETURN
SUMMARY: FEES AND EXPENSES
This
table describes the fees and expenses that you may pay if you buy and hold the Fund's Class A Shares (A), Class C Shares (C) and Institutional Shares (IS). You may qualify for certain sales charge discounts if you and
your family invest, or agree to invest in the future, at least $50,000 in certain classes (e.g., A class) of Federated Funds. More information about these and other discounts is available from your financial
professional and in the “What Do Shares Cost?” section of the Prospectus on page 10.
Shareholder Fees (fees paid directly from your investment)
|
A
|
C
|
IS
|
Maximum Sales Charge (Load) Imposed on
Purchases (as a percentage of
offering price)
|
5.50%
|
None
|
None
|
Maximum Deferred Sales Charge (Load)
(as a percentage of original purchase price or redemption proceeds,
as applicable)
|
0.00%
|
1.00%
|
None
|
Maximum Sales Charge (Load) Imposed on
Reinvested Dividends (and other Distributions)
(as a percentage of offering price)
|
None
|
None
|
None
|
Redemption Fee (as a percentage of
amount redeemed,
if applicable)
|
None
|
None
|
None
|
Exchange Fee
|
None
|
None
|
None
|
Annual Fund Operating Expenses
(
expenses that pay each year as a percentage of the value of your investment)
|
|
|
|
Management Fee
|
0.75%
|
0.75%
|
0.75%
|
Distribution (12b-1) Fee
|
0.05%
|
0.75%
|
None
|
Other Expenses
|
0.44%
|
0.44%
|
0.19%
|
Acquired Fund Fees
and Expenses
|
0.01%
|
0.01%
|
0.01%
|
Total Annual Fund
Operating Expenses
|
1.25%
|
1.95%
|
0.95%
|
Fee Waivers
and/or Expense Reimbursements
1
|
0.19%
|
0.14%
|
0.14%
|
Total Annual Fund Operating Expenses
After Fee Waivers
and/or
Expense Reimbursements
|
1.06%
|
1.81%
|
0.81%
|
1
|
The Adviser and its affiliates have voluntarily agreed to waive their fees and/or reimburse expenses so that the total annual fund operating expenses (excluding Acquired Fund Fees and Expenses) paid by the Fund's A,
C and IS classes (after the voluntary waivers and/or reimbursements) will not exceed 1.05%, 1.80% and 0.80% (the “Fee Limit”), respectively, up to but not including the later of (the “Termination
Date”): (a) January 1, 2014; or (b) the date of the Fund's next effective Prospectus. While the Adviser and its affiliates currently do not anticipate terminating or increasing these arrangements prior to the
Termination Date, these arrangements may only be terminated or the Fee Limit increased prior to the Termination Date with the agreement of the Fund's Board of Trustees.
|
Example
This
Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.
The
Example assumes that you invest $10,000 for the time periods indicated and then redeem all of your Shares at the end of those periods. Expenses assuming no redemption are also shown. The Example also assumes that your
investment has a 5% return each year and that operating expenses are as shown in the table above and remain the same. Although your actual costs and returns may be higher or lower, based on these assumptions your costs
would be:
Share Class
|
1 Year
|
3 Years
|
5 Years
|
10 Years
|
A:
|
|
|
|
|
Expenses assuming redemption
|
$670
|
$925
|
$1,199
|
$1,978
|
Expenses assuming no redemption
|
$670
|
$925
|
$1,199
|
$1,978
|
C:
|
|
|
|
|
Expenses assuming redemption
|
$298
|
$612
|
$1,052
|
$2,275
|
Expenses assuming no redemption
|
$198
|
$612
|
$1,052
|
$2,275
|
IS:
|
|
|
|
|
Expenses assuming redemption
|
$
97
|
$303
|
$
525
|
$1,166
|
Expenses assuming no redemption
|
$
97
|
$303
|
$
525
|
$1,166
|
Portfolio Turnover
The
Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in
higher taxes when Fund Shares are held in a taxable account. These costs, which are not reflected in Annual Fund Operating Expenses or in the Example, affect the Fund's performance. During the most recent fiscal year,
the Fund's portfolio turnover rate was 20% of the average value of its portfolio.
RISK/RETURN
SUMMARY: INVESTMENTS, RISKS and PERFORMANCE
What are the Fund's Main
Investment Strategies?
The
Fund pursues its investment objective by investing primarily in high dividend yielding common stocks with dividend growth potential. The Adviser believes a strategic emphasis on high dividend yielding stocks can
enhance both relative and absolute performance over time. In addition, investment results can be enhanced by focusing on stocks with both the potential for future dividend growth and current dividend-oriented value
characteristics. The Adviser believes that this is achievable while targeting significantly less risk.
The
Fund's security selection process involves screening and prioritizing stocks based on appropriate quantitative statistics. Those companies that rank as highly attractive in the screening process are closely scrutinized
for inclusion in the portfolio using bottom-up fundamental proprietary research. The Fund may use derivative contracts, such as forward contracts, to manage or hedge the Fund's currency exposure.
Because the Fund refers to dividends in its name, it will notify shareholders at least 60 days in advance of any change in its investment policies that would enable the Fund to normally invest less than
80% of its net assets (plus any borrowings for investment purposes) in dividend-paying securities.
What are the Main Risks
of Investing in the Fund?
All
mutual funds take investment risks. Therefore, it is possible to lose money by investing in the Fund. The primary factors that may reduce the Fund's returns include:
■
|
Stock Market Risk.
The value of equity securities in the Fund's portfolio will fluctuate and, as a result, the Fund's Share price may decline suddenly or over a sustained period of time.
|
■
|
Risk Related to Investing for Value.
Due to their relatively low valuations, value stocks are typically less volatile than growth stocks and more likely to pay higher dividends. The Fund's strategy contemplates investing in
stocks focused on paying high dividends. Accordingly, the Fund's performance may lag behind the general market when dividend paying stocks are out of favor.
|
■
|
Risk of Foreign Investing.
Because the Fund invests in securities issued by foreign companies, the Fund's Share price may be more affected by foreign economic and political conditions, taxation policies and
accounting and auditing standards than would otherwise be the case.
|
■
|
Risk of Investing in ADRs and Domestically-Traded Securities of Foreign Issuers.
Because the Fund may invest in American Depositary Receipts (ADRs) and other domestically-traded securities of foreign companies, the Fund's Share price may be more affected by foreign
economic and political conditions, taxation policies and accounting and auditing standards than would otherwise be the case.
|
■
|
Custodial Services and Related Investment Costs.
Custodial services and other costs relating to investment in international securities markets generally are more expensive than in the United States. Such markets have settlement and
clearance procedures that differ from those in the United States. The inability of the Fund to make intended securities purchases due to settlement problems could cause the Fund to miss attractive investment
opportunities.
|
■
|
Currency Risk.
Exchange rates for currencies fluctuate daily. The combination of currency risk and stock market risk tends to make securities traded in foreign markets more volatile than securities
traded exclusively in the United States.
|
■
|
Eurozone Related Risk.
A number of countries in the European Union (EU) have experienced, and may continue to experience, severe economic and financial difficulties. Additional EU member countries may also fall
subject to such difficulties. These events could negatively affect the value and liquidity of the Fund's investments in euro-denominated securities and derivatives contracts, securities of issuers located in the EU or
with significant exposure to EU issuers or countries.
|
■
|
Sector Risk.
Because the Fund may allocate relatively more assets to certain industry sectors than others, the Fund's performance may be more susceptible to any developments which affect those sectors
emphasized by the Fund.
|
■
|
Liquidity Risk.
The equity securities in which the Fund invests may be less readily marketable and may be subject to greater fluctuation in price than other securities.
|
■
|
Risks of Investing in Derivative Contracts.
Derivative contracts involve risks different from, or possibly greater than, risks associated with investing directly in securities and other traditional investments. Specific risk issues
related to the use of such contracts include valuation and tax issues, increased potential for losses and/or costs to the Fund, and a potential reduction in gains to the Fund. Each of these issues is described in
greater detail in this Prospectus. Derivative contracts may also involve other risks described in this Prospectus or the Fund's Statement of Additional Information (SAI), such as stock market, interest rate, credit,
currency, liquidity and leverage risks.
|
■
|
Technology Risk.
Proprietary and third party data and systems are utilized to support decision making for the Fund. Data imprecision, software or other technology malfunctions, programming inaccuracies and
similar circumstances may impair the performance of these systems, which may negatively affect Fund performance.
|
The
Shares offered by this Prospectus are not deposits or obligations of any bank, are not endorsed or guaranteed by any bank and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance
Corporation, the Federal Reserve Board or any other government agency.
Performance: Bar
Chart and Table
Risk/Return Bar Chart
The
Fund's A, C and IS classes commenced operations on March 30, 2005. The bar chart and performance table below reflect historical performance data for the Fund and are intended to help you analyze the Fund's investment
risks in light of its historical returns. The bar chart shows the variability of the Fund's IS class total returns on a calendar year-by-year basis. The Average Annual Total Return table shows returns
averaged
over the stated periods, and includes comparative performance information.
The Fund's performance will fluctuate, and
past performance (before and after taxes) is not necessarily an indication of future results.
Updated performance information for the Fund is available under the “Products” section at FederatedInvestors.com or by calling 1-800-341-7400.
The Fund's IS class
total return for the nine-month period from January 1, 2012 to September 30, 2012 was 8.76%.
Within the periods
shown in the bar chart, the Fund's IS class highest quarterly return was 13.38% (quarter ended September 30, 2010). Its lowest quarterly return was (15.10)% (quarter ended March 31, 2009).
Average Annual Total
Return Table
In
addition to Return Before Taxes, Return After Taxes is shown for the Fund's IS class to illustrate the effect of federal taxes on Fund returns. After-tax returns are shown only for IS class, and after-tax returns for A
and C classes will differ from those shown for the IS class.
Actual after-tax returns depend on each investor's personal tax situation, and are likely to differ from those shown.
After-tax returns are calculated using a standard set of
assumptions. The stated returns assume the highest historical
federal
income and capital gains tax rates. These after-tax returns do
not
reflect the effect of any applicable
state
and
local
taxes. After-tax returns are not relevant to investors holding Shares through a 401(k) plan, an Individual Retirement Account and other tax-advantage investment plans.
(For the Period Ended
December 31, 2011)
|
1 Year
|
5 Years
|
Since
Inception
3/30/2005
|
A:
|
|
|
|
Return Before Taxes
|
8.08%
|
(1.60)%
|
3.86%
|
C:
|
|
|
|
Return Before Taxes
|
12.63%
|
(1.19)%
|
4.00%
|
IS:
|
|
|
|
Return Before Taxes
|
14.96%
|
(0.19)%
|
5.03%
|
Return After Taxes on Distributions
|
13.36%
|
(1.24)%
|
3.96%
|
Return After Taxes on Distributions and Sale of Fund Shares
|
9.66%
|
(0.47)%
|
4.02%
|
|
1 Year
|
5 Years
|
Since
Inception
3/30/2005
|
Standard & Poor's 500 Index
1
(reflects no deduction for fees, expenses or taxes)
|
2.11%
|
(0.25)%
|
3.05%
|
Dow Jones Select Dividend Index
2
(reflects no deduction for fees, expenses or taxes)
|
12.42%
|
(0.66)%
|
1.05%
|
1
|
The Standard & Poor's 500 is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing
all major industries.
|
2
|
The Dow Jones Select Dividend Index is a dividend weighted index intended to represent the 100 stocks in the Dow Jones U.S. Total Market Index that have the highest indicated annual dividend yield.
|
FUND MANAGEMENT
The
Fund's Investment Adviser is Federated Equity Management Company of Pennsylvania.
Walter
C. Bean, Senior Portfolio Manager, has been the Fund's portfolio manager since inception in March 2005.
Daniel
Peris, Senior Portfolio Manager, has been the Fund's portfolio manager since October 2006.
purchase and sale
of fund shares
You
may purchase, redeem or exchange Shares of the Fund on any day the New York Stock Exchange is open. Shares may be purchased through a financial intermediary firm that has entered into a Fund selling and/or servicing
agreement with the Distributor or an affiliate (“Financial Intermediary”) or directly from the Fund, by wire or by check. Please note that certain purchase restrictions may apply. Redeem or exchange Shares
through a financial intermediary or directly from the Fund by telephone at 1-800-341-7400 or by mail.
A & C Classes
The
minimum investment amount for the Fund's A and C classes is generally $1,500 for initial investments and $100 for subsequent investments. The minimum initial and subsequent investment amounts for Individual Retirement
Accounts are generally $250 and $100, respectively. There is no minimum initial or subsequent investment amount for employer-sponsored retirement plans. The minimum investment for Systematic Investment Programs is $50.
IS Class
The
minimum initial investment amount for the Fund's IS class is generally $1,000,000 and there is no minimum subsequent investment amount. The minimum investment amount for Systematic Investment Programs is $50.
Tax Information
The
Fund's distributions are taxable as ordinary income or capital gains except when your investment is through a 401(k) plan, an Individual Retirement Account or other tax-advantaged investment plan.
Payments to
Broker-Dealers and Other Financial Intermediaries
If you
purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and/or its related companies may pay the intermediary for the sale of Fund Shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial
intermediary's website for more information.
Federated Strategic
Value Dividend Fund
Federated Investors Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
Contact us at
FederatedInvestors.com
or call 1-800-341-7400.
Federated Securities
Corp., Distributor
Investment Company Act
File No. 811-4017
CUSIP 314172586
CUSIP 314172578
CUSIP 314172560
Q450376 (12/12)
Federated is a
registered trademark of Federated Investors, Inc.
2012 ©Federated Investors, Inc.