United States
Securities and Exchange Commission
Washington, D.C. 20549
Form N-CSR
Certified Shareholder Report of Registered Management Investment Companies
811-4017
(Investment Company Act File Number)
Federated Hermes Equity Funds _______________________________________________________________
(Exact Name of Registrant as Specified in Charter)
Federated Hermes Funds
4000 Ericsson Drive
Warrendale, Pennsylvania 15086-7561
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
Peter J. Germain, Esquire
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
(Notices should be sent to the Agent for Service)
Date of Fiscal Year End: 09/30/23
Date of Reporting Period: 09/30/23
Item 1. | Reports to Stockholders |
Share Class | Ticker | A | VSFAX | C | VSFCX | R | VSFRX |
Institutional | VSFIX | R6 | VSFSX |
Federated Hermes Clover Small Value Fund
A Portfolio of Federated Hermes Equity Funds
1 Year | 5 Years | 10 Years | |
Class A Shares | 1.43% | 2.94% | 5.82% |
Class C Shares | 5.53% | 3.31% | 5.78% |
Class R Shares | 7.23% | 4.07% | 6.35% |
Institutional Shares | 7.64% | 4.38% | 6.69% |
Class R6 Shares4 | 7.67% | 4.45% | 6.66% |
R2000V | 7.84% | 2.59% | 6.19% |
MSVFA | 15.00% | 4.52% | 6.53% |
Sector Composition | Percentage of Total Net Assets |
Financials | 24.1% |
Industrials | 18.3% |
Consumer Discretionary | 9.8% |
Energy | 9.1% |
Real Estate | 7.1% |
Information Technology | 6.3% |
Health Care | 6.2% |
Materials | 5.0% |
Consumer Staples | 4.2% |
Utilities | 4.0% |
Communication Services | 2.8% |
Securities Lending Collateral2 | 0.7% |
Cash Equivalents3 | 4.1% |
Other Assets and Liabilities—Net4 | (1.7)% |
TOTAL | 100% |
1 | Except for Securities Lending Collateral, Cash Equivalents and Other Assets and Liabilities, sector classifications are based upon, and individual portfolio securities are assigned to, the classifications of the Global Industry Classification Standard (GICS), except that the Adviser assigns a classification to securities not classified by the GICS and to securities for which the Adviser does not have access to the classification made by the GICS. |
2 | Represents cash collateral received for portfolio securities on loan that may be invested in affiliated money market funds, other money market instruments and/or repurchase agreements. |
3 | Cash Equivalents include any investments in money market mutual funds and/or overnight repurchase agreements other than those representing cash collateral for securities lending. |
4 | Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. |
Shares | Value | ||
COMMON STOCKS— 96.9% | |||
Communication Services— 2.8% | |||
106,695 | Criteo S.A., ADR | $ 3,115,494 | |
50,416 | 1 | Yelp, Inc. | 2,096,801 |
TOTAL | 5,212,295 | ||
Consumer Discretionary— 9.8% | |||
14,203 | Academy Sports and Outdoors, Inc. | 671,376 | |
49,434 | 1 | Adient PLC | 1,814,228 |
39,748 | Boyd Gaming Corp. | 2,417,871 | |
33,473 | Century Communities, Inc. | 2,235,327 | |
132,606 | Gap (The), Inc. | 1,409,602 | |
24,979 | Meritage Corp. | 3,057,180 | |
20,011 | 1 | Ollie’s Bargain Outlet Holdings, Inc. | 1,544,449 |
24,247 | Signet Jewelers Ltd. | 1,741,177 | |
5,684 | Thor Industries, Inc. | 540,719 | |
63,476 | Travel + Leisure Co. | 2,331,473 | |
4,761 | 1 | Visteon Corp. | 657,351 |
TOTAL | 18,420,753 | ||
Consumer Staples— 4.2% | |||
131,188 | 2 | B&G Foods, Inc., Class A | 1,297,449 |
150,994 | 1 | Mission Produce, Inc. | 1,461,622 |
26,770 | PriceSmart, Inc. | 1,992,491 | |
294,413 | Vector Group Ltd. | 3,132,555 | |
TOTAL | 7,884,117 | ||
Energy— 9.1% | |||
19,425 | Chord Energy Corp. | 3,148,210 | |
39,918 | Civitas Resources, Inc. | 3,228,168 | |
101,812 | Northern Oil and Gas, Inc. | 4,095,897 | |
54,203 | PBF Energy, Inc. | 2,901,486 | |
188,964 | TechnipFMC PLC | 3,843,528 | |
TOTAL | 17,217,289 | ||
Financials— 24.1% | |||
414,933 | AGNC Investment Corp. | 3,916,967 | |
82,308 | 1 | Avantax, Inc. | 2,105,439 |
42,615 | 1 | Axos Financial, Inc. | 1,613,404 |
145,739 | Cadence Bank | 3,092,582 | |
78,232 | CNO Financial Group, Inc. | 1,856,445 | |
116,322 | Columbia Banking Systems, Inc. | 2,361,337 | |
177,363 | First Commonwealth Financial Corp. | 2,165,602 |
Shares | Value | ||
COMMON STOCKS— continued | |||
Financials— continued | |||
201,901 | FNB Corp. (PA) | $ 2,178,512 | |
19,465 | Hanover Insurance Group, Inc. | 2,160,226 | |
61,828 | 1 | I3 Verticals, Inc. | 1,307,044 |
223,392 | Old National Bancorp | 3,248,120 | |
38,247 | Pennymac Financial Services, Inc. | 2,547,250 | |
12,428 | Primerica, Inc. | 2,411,156 | |
208,629 | 1 | Repay Holdings Corp. | 1,583,494 |
72,905 | Seacoast Banking Corp. of Florida | 1,600,994 | |
16,623 | Selective Insurance Group, Inc. | 1,714,995 | |
44,981 | South State Corp. | 3,029,920 | |
34,444 | Stifel Financial Corp. | 2,116,239 | |
44,517 | United Bankshares, Inc. | 1,228,224 | |
41,443 | Wintrust Financial Corp. | 3,128,946 | |
TOTAL | 45,366,896 | ||
Health Care— 6.2% | |||
81,018 | 1 | AdaptHealth Corp. | 737,264 |
397,572 | 1 | ADMA Biologics, Inc. | 1,423,308 |
55,817 | 1 | Avanos Medical, Inc. | 1,128,620 |
46,128 | 1 | Envista Holdings Corp. | 1,286,048 |
29,939 | 1 | Halozyme Therapeutics, Inc. | 1,143,670 |
20,701 | 1 | Harmony Biosciences Holdings, Inc. | 678,372 |
46,267 | 1 | Pacira BioSciences, Inc. | 1,419,471 |
13,952 | 1 | Prestige Consumer Healthcare, Inc. | 797,915 |
103,038 | 1 | R1 RCM, Inc. | 1,552,783 |
34,646 | 1 | Revance Therapeutics, Inc. | 397,389 |
16,606 | 1 | Tenet Healthcare Corp. | 1,094,169 |
TOTAL | 11,659,009 | ||
Industrials— 18.3% | |||
23,303 | Arcosa, Inc. | 1,675,486 | |
73,943 | 1 | Blue Bird Corp. | 1,578,683 |
27,209 | 1 | BlueLinx Holdings, Inc. | 2,233,587 |
12,247 | Boise Cascade Co. | 1,261,931 | |
5,182 | Encore Wire Corp. | 945,508 | |
63,441 | Enerpac Tool Group Corp. | 1,676,746 | |
14,024 | EnPro Industries, Inc. | 1,699,569 | |
24,384 | Esab Corp. | 1,712,244 | |
45,641 | Federal Signal Corp. | 2,726,137 | |
37,818 | 1 | Gibraltar Industries, Inc. | 2,553,093 |
58,051 | H&E Equipment Services, Inc. | 2,507,223 | |
32,549 | Helios Technologies, Inc. | 1,805,819 | |
16,793 | 1 | Hub Group, Inc. | 1,318,922 |
Shares | Value | ||
COMMON STOCKS— continued | |||
Industrials— continued | |||
25,493 | 1 | Masonite International Corp. | $ 2,376,457 |
25,144 | MOOG, Inc., Class A | 2,840,266 | |
129,841 | Schneider National, Inc. | 3,595,297 | |
25,611 | 1 | XPO, Inc. | 1,912,117 |
TOTAL | 34,419,085 | ||
Information Technology— 6.3% | |||
108,078 | 1 | Applied Blockchain, Inc. | 674,407 |
29,479 | Avnet, Inc. | 1,420,593 | |
17,283 | 1 | Diodes, Inc. | 1,362,592 |
15,782 | 1 | IPG Photonics Corp. | 1,602,504 |
30,957 | 1 | Perficient, Inc. | 1,791,172 |
208,732 | 1 | TTM Technologies, Inc. | 2,688,468 |
63,445 | 1 | Verint Systems, Inc. | 1,458,601 |
124,792 | 1 | Yext, Inc. | 789,933 |
TOTAL | 11,788,270 | ||
Materials— 5.0% | |||
33,803 | Ashland, Inc. | 2,761,029 | |
57,888 | Commercial Metals Corp. | 2,860,246 | |
259,575 | 1,3 | Ferroglobe Representation & Warranty Insurance Trust | 0 |
43,323 | 1 | MP Materials Corp. | 827,469 |
24,286 | 1 | Summit Materials, Inc. | 756,266 |
165,674 | Tronox Holdings PLC | 2,226,659 | |
TOTAL | 9,431,669 | ||
Real Estate— 7.1% | |||
88,720 | COPT Defense Properties | 2,114,198 | |
111,045 | Easterly Government Properties, Inc. | 1,269,244 | |
68,386 | EPR PPTYS | 2,840,755 | |
167,165 | Kite Realty Group Trust | 3,580,674 | |
104,341 | STAG Industrial, Inc. | 3,600,808 | |
TOTAL | 13,405,679 | ||
Utilities— 4.0% | |||
76,349 | Allete, Inc. | 4,031,227 | |
37,098 | Idacorp, Inc. | 3,474,228 | |
TOTAL | 7,505,455 | ||
TOTAL COMMON STOCKS (IDENTIFIED COST $177,552,378) | 182,310,517 | ||
INVESTMENT COMPANIES— 4.8% | |||
1,285,490 | Federated Hermes Government Obligations Fund, Premier Shares, 5.25%4 | 1,285,490 |
Shares | Value | ||
INVESTMENT COMPANIES— continued | |||
7,646,298 | Federated Hermes Institutional Prime Value Obligations Fund, Institutional Shares, 5.42%4 | $ 7,646,298 | |
TOTAL INVESTMENT COMPANIES (IDENTIFIED COST $8,931,467) | 8,931,788 | ||
TOTAL INVESTMENT IN SECURITIES—101.7% (IDENTIFIED COST $186,483,845)5 | 191,242,305 | ||
OTHER ASSETS AND LIABILITIES - NET—(1.7)%6 | (3,130,012) | ||
TOTAL NET ASSETS—100% | $188,112,293 |
Federated Hermes Institutional Prime Value Obligations Fund, Institutional Shares | Federated Hermes Government Obligations Fund, Premier Shares* | Total of Affiliated Transactions | |
Value as of 9/30/2022 | $6,347,851 | $— | $6,347,851 |
Purchases at Cost | $92,572,522 | $8,711,927 | $101,284,449 |
Proceeds from Sales | $(91,273,530) | $(7,426,437) | $(98,699,967) |
Change in Unrealized Appreciation/ Depreciation | $(1,069) | $— | $(1,069) |
Net Realized Gain/(Loss) | $524 | $— | $524 |
Value as of 9/30/2023 | $7,646,298 | $1,285,490 | $8,931,788 |
Shares Held as of 9/30/2023 | 7,646,298 | 1,285,490 | 8,931,788 |
Dividend Income | $284,763 | $17,098 | $301,861 |
* | All or a portion of the balance/activity for the fund relates to cash collateral received on securities lending transactions. |
1 | Non-income-producing security. |
2 | All or a portion of these securities are temporarily on loan to unaffiliated broker/dealers. |
3 | Market quotations and price valuations are not available. Fair value determined using significant unobservable inputs in accordance with procedures established by and under the supervision of the Fund’s Adviser acting through its Valuation Committee. |
4 | 7-day net yield. |
5 | The cost of investments for federal tax purposes amounts to $187,359,878. |
6 | Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. |
The following is a summary of the inputs used, as of September 30, 2023, in valuing the Fund’s assets carried at fair value:
Valuation Inputs | ||||
Level 1— Quoted Prices | Level 2— Other Significant Observable Inputs | Level 3— Significant Unobservable Inputs | Total | |
Equity Securities: | ||||
Common Stocks | ||||
Domestic | $167,192,974 | $— | $0 | $167,192,974 |
International | 15,117,543 | — | — | 15,117,543 |
Investment Companies | 8,931,788 | — | — | 8,931,788 |
TOTAL SECURITIES | $191,242,305 | $— | $0 | $191,242,305 |
The following acronym(s) are used throughout this portfolio: | ||
ADR | —American Depositary Receipt |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $22.63 | $28.03 | $17.10 | $19.23 | $26.36 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.26 | 0.16 | 0.10 | 0.03 | 0.05 |
Net realized and unrealized gain (loss) | 1.48 | (3.23) | 10.86 | (2.09) | (3.03) |
Total From Investment Operations | 1.74 | (3.07) | 10.96 | (2.06) | (2.98) |
Less Distributions: | |||||
Distributions from net investment income | (0.04) | (0.08) | (0.03) | (0.07) | (0.02) |
Distributions from net realized gain | (2.03) | (2.25) | — | — | (4.13) |
Total Distributions | (2.07) | (2.33) | (0.03) | (0.07) | (4.15) |
Net Asset Value, End of Period | $22.30 | $22.63 | $28.03 | $17.10 | $19.23 |
Total Return2 | 7.33% | (12.29)% | 64.10% | (10.77)% | (11.25)% |
Ratios to Average Net Assets: | |||||
Net expenses3 | 1.13% | 1.13% | 1.23% | 1.26% | 1.26% |
Net investment income | 1.09% | 0.62% | 0.38% | 0.16% | 0.26% |
Expense waiver/reimbursement4 | 0.32% | 0.33% | 0.30% | 0.21% | 0.21% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $55,009 | $58,331 | $70,636 | $45,527 | $62,463 |
Portfolio turnover5 | 92% | 94% | 86% | 89% | 74% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
5 | Securities that mature are considered sales for purposes of this calculation. |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $20.53 | $25.75 | $15.81 | $17.85 | $24.95 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.06 | (0.04) | (0.09) | (0.10) | (0.09) |
Net realized and unrealized gain (loss) | 1.37 | (2.93) | 10.03 | (1.94) | (2.88) |
Total From Investment Operations | 1.43 | (2.97) | 9.94 | (2.04) | (2.97) |
Less Distributions: | |||||
Distributions from net realized gain | (2.03) | (2.25) | — | — | (4.13) |
Net Asset Value, End of Period | $19.93 | $20.53 | $25.75 | $15.81 | $17.85 |
Total Return2 | 6.50% | (13.00)% | 62.87% | (11.43)% | (11.94)% |
Ratios to Average Net Assets: | |||||
Net expenses3 | 1.92% | 1.92% | 2.00% | 2.04% | 2.01% |
Net investment income (loss) | 0.31% | (0.16)% | (0.40)% | (0.63)% | (0.50)% |
Expense waiver/reimbursement4 | 0.30% | 0.31% | 0.28% | 0.22% | 0.18% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $6,253 | $6,498 | $8,074 | $5,716 | $9,446 |
Portfolio turnover5 | 92% | 94% | 86% | 89% | 74% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | This expense decrease is reflected in both the net expense and the net investment income (loss) ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
5 | Securities that mature are considered sales for purposes of this calculation. |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $22.10 | $27.44 | $16.74 | $18.83 | $25.93 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.23 | 0.14 | 0.09 | 0.03 | 0.05 |
Net realized and unrealized gain (loss) | 1.45 | (3.15) | 10.64 | (2.05) | (2.99) |
Total From Investment Operations | 1.68 | (3.01) | 10.73 | (2.02) | (2.94) |
Less Distributions: | |||||
Distributions from net investment income | (0.02) | (0.08) | (0.03) | (0.07) | (0.03) |
Distributions from net realized gain | (2.03) | (2.25) | — | — | (4.13) |
Total Distributions | (2.05) | (2.33) | (0.03) | (0.07) | (4.16) |
Net Asset Value, End of Period | $21.73 | $22.10 | $27.44 | $16.74 | $18.83 |
Total Return2 | 7.23% | (12.36)% | 64.12% | (10.78)% | (11.27)% |
Ratios to Average Net Assets: | |||||
Net expenses3 | 1.22% | 1.22% | 1.25% | 1.27% | 1.32% |
Net investment income | 1.01% | 0.53% | 0.38% | 0.16% | 0.24% |
Expense waiver/reimbursement4 | 0.46% | 0.46% | 0.51% | 0.46% | 0.40% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $12,179 | $11,898 | $14,260 | $9,646 | $13,675 |
Portfolio turnover5 | 92% | 94% | 86% | 89% | 74% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
5 | Securities that mature are considered sales for purposes of this calculation. |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $22.69 | $28.11 | $17.13 | $19.29 | $26.48 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.32 | 0.23 | 0.16 | 0.07 | 0.10 |
Net realized and unrealized gain (loss) | 1.49 | (3.24) | 10.89 | (2.08) | (3.06) |
Total From Investment Operations | 1.81 | (3.01) | 11.05 | (2.01) | (2.96) |
Less Distributions: | |||||
Distributions from net investment income | (0.10) | (0.16) | (0.07) | (0.15) | (0.10) |
Distributions from net realized gain | (2.03) | (2.25) | — | — | (4.13) |
Total Distributions | (2.13) | (2.41) | (0.07) | (0.15) | (4.23) |
Net Asset Value, End of Period | $22.37 | $22.69 | $28.11 | $17.13 | $19.29 |
Total Return2 | 7.64% | (12.10)% | 64.63% | (10.57)% | (11.05)% |
Ratios to Average Net Assets: | |||||
Net expenses3 | 0.88% | 0.88% | 0.96% | 1.01% | 1.01% |
Net investment income | 1.36% | 0.89% | 0.64% | 0.36% | 0.50% |
Expense waiver/reimbursement4 | 0.33% | 0.33% | 0.31% | 0.22% | 0.16% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $105,927 | $88,206 | $97,317 | $63,019 | $203,935 |
Portfolio turnover5 | 92% | 94% | 86% | 89% | 74% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
5 | Securities that mature are considered sales for purposes of this calculation. |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $22.72 | $28.13 | $17.15 | $19.21 | $26.39 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.35 | 0.24 | 0.18 | 0.09 | 0.08 |
Net realized and unrealized gain (loss) | 1.47 | (3.23) | 10.89 | (2.09) | (3.02) |
Total From Investment Operations | 1.82 | (2.99) | 11.07 | (2.00) | (2.94) |
Less Distributions: | |||||
Distributions from net investment income | (0.11) | (0.17) | (0.09) | (0.06) | (0.11) |
Distributions from net realized gain | (2.03) | (2.25) | — | — | (4.13) |
Total Distributions | (2.14) | (2.42) | (0.09) | (0.06) | (4.24) |
Net Asset Value, End of Period | $22.40 | $22.72 | $28.13 | $17.15 | $19.21 |
Total Return2 | 7.67% | (12.00)% | 64.64% | (10.47)% | (11.00)% |
Ratios to Average Net Assets: | |||||
Net expenses3 | 0.81% | 0.81% | 0.91% | 0.94% | 0.94% |
Net investment income | 1.51% | 0.91% | 0.70% | 0.53% | 0.37% |
Expense waiver/reimbursement4 | 0.30% | 0.30% | 0.28% | 0.21% | 0.14% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $8,744 | $5,200 | $6,924 | $4,644 | $8,297 |
Portfolio turnover5 | 92% | 94% | 86% | 89% | 74% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
5 | Securities that mature are considered sales for purposes of this calculation. |
September 30, 2023
Assets: | |
Investment in securities, at value including $1,284,167 of securities loaned and $8,931,788 of investments in affiliated holdings* (identified cost $186,483,845, including $8,931,467 of identified cost in affiliated holdings) | $191,242,305 |
Income receivable | 240,756 |
Income receivable from affiliated holdings | 20,988 |
Receivable for investments sold | 3,101,694 |
Receivable for shares sold | 66,142 |
Total Assets | 194,671,885 |
Liabilities: | |
Payable for investments purchased | 5,025,141 |
Payable for shares redeemed | 99,289 |
Payable to bank | 2,523 |
Payable for collateral due to broker for securities lending (Note 2) | 1,285,490 |
Payable for investment adviser fee (Note 5) | 5,499 |
Payable for administrative fee (Note 5) | 805 |
Payable for distribution services fee (Note 5) | 7,576 |
Payable for other service fees (Notes 2 and 5) | 12,254 |
Accrued expenses (Note 5) | 121,015 |
Total Liabilities | 6,559,592 |
Net assets for 8,466,603 shares outstanding | $188,112,293 |
Net Assets Consist of: | |
Paid-in capital | $178,951,054 |
Total distributable earnings (loss) | 9,161,239 |
Total Net Assets | $188,112,293 |
Net Asset Value, Offering Price and Redemption Proceeds Per Share: | |
Class A Shares: | |
Net asset value per share ($55,008,510 ÷ 2,466,415 shares outstanding), no par value, unlimited shares authorized | $22.30 |
Offering price per share (100/94.50 of $22.30) | $23.60 |
Redemption proceeds per share | $22.30 |
Class C Shares: | |
Net asset value per share ($6,253,407 ÷ 313,710 shares outstanding), no par value, unlimited shares authorized | $19.93 |
Offering price per share | $19.93 |
Redemption proceeds per share (99.00/100 of $19.93) | $19.73 |
Class R Shares: | |
Net asset value per share ($12,178,611 ÷ 560,478 shares outstanding), no par value, unlimited shares authorized | $21.73 |
Offering price per share | $21.73 |
Redemption proceeds per share | $21.73 |
Institutional Shares: | |
Net asset value per share ($105,927,275 ÷ 4,735,670 shares outstanding), no par value, unlimited shares authorized | $22.37 |
Offering price per share | $22.37 |
Redemption proceeds per share | $22.37 |
Class R6 Shares: | |
Net asset value per share ($8,744,490 ÷ 390,330 shares outstanding), no par value, unlimited shares authorized | $22.40 |
Offering price per share | $22.40 |
Redemption proceeds per share | $22.40 |
* | See information listed after the Fund’s Portfolio of Investments. |
Year Ended September 30, 2023
Investment Income: | |
Dividends (including $284,763 received from affiliated holdings* ) | $4,479,663 |
Net income on securities loaned (includes $17,098 earned from affiliated holdings related to cash collateral balances) (Note 2) | 6,090 |
TOTAL INCOME | 4,485,753 |
Expenses: | |
Investment adviser fee (Note 5) | 1,703,254 |
Administrative fee (Note 5) | 157,657 |
Custodian fees | 16,261 |
Transfer agent fees (Note 2) | 246,279 |
Directors’/Trustees’ fees (Note 5) | 1,866 |
Auditing fees | 35,398 |
Legal fees | 11,662 |
Portfolio accounting fees | 103,939 |
Distribution services fee (Note 5) | 118,159 |
Other service fees (Notes 2 and 5) | 172,752 |
Share registration costs | 82,328 |
Printing and postage | 31,622 |
Miscellaneous (Note 5) | 27,467 |
TOTAL EXPENSES | 2,708,644 |
Waivers and Reimbursements: | |
Waiver/reimbursement of investment adviser fee (Note 5) | (605,285) |
Waivers/reimbursements of other operating expenses (Notes 2 and 5) | (63,520) |
TOTAL WAIVERS AND REIMBURSEMENTS | (668,805) |
Net expenses | 2,039,839 |
Net investment income | 2,445,914 |
Realized and Unrealized Gain (Loss) on Investments: | |
Net realized gain on investments (including net realized gain of $524 on sales of investments in affiliated holdings*) | 4,488,410 |
Net change in unrealized depreciation of investments (including net change in unrealized appreciation of $(1,069) of investments in affiliated holdings*) | 5,803,625 |
Net realized and unrealized gain (loss) on investments | 10,292,035 |
Change in net assets resulting from operations | $12,737,949 |
* | See information listed after the Fund’s Portfolio of Investments. |
Year Ended September 30 | 2023 | 2022 |
Increase (Decrease) in Net Assets | ||
Operations: | ||
Net investment income | $2,445,914 | $1,421,255 |
Net realized gain (loss) | 4,488,410 | 18,070,474 |
Net change in unrealized appreciation/depreciation | 5,803,625 | (43,423,863) |
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | 12,737,949 | (23,932,134) |
Distributions to Shareholders: | ||
Class A Shares | (5,347,735) | (5,780,869) |
Class C Shares | (636,086) | (647,794) |
Class R Shares | (1,109,919) | (1,235,754) |
Institutional Shares | (8,639,712) | (8,200,916) |
Class R6 Shares | (529,819) | (639,094) |
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS | (16,263,271) | (16,504,427) |
Share Transactions: | ||
Proceeds from sale of shares | 76,255,842 | 47,093,908 |
Net asset value of shares issued to shareholders in payment of distributions declared | 15,774,400 | 15,974,896 |
Cost of shares redeemed | (70,525,518) | (49,710,854) |
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS | 21,504,724 | 13,357,950 |
Change in net assets | 17,979,402 | (27,078,611) |
Net Assets: | ||
Beginning of period | 170,132,891 | 197,211,502 |
End of period | $188,112,293 | $170,132,891 |
Transfer Agent Fees Incurred | Transfer Agent Fees Reimbursed | |
Class A Shares | $77,074 | $(12,978) |
Class C Shares | 9,759 | — |
Class R Shares | 13,247 | (1,130) |
Institutional Shares | 143,413 | (29,940) |
Class R6 Shares | 2,786 | — |
TOTAL | $246,279 | $(44,048) |
Other Service Fees Incurred | |
Class A Shares | $155,049 |
Class C Shares | 17,703 |
TOTAL | $172,752 |
Fair Value of Securities Loaned | Collateral Received |
$1,284,167 | $1,285,490 |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Class A Shares: | Shares | Amount | Shares | Amount |
Shares sold | 257,417 | $6,072,387 | 419,906 | $11,073,253 |
Shares issued to shareholders in payment of distributions declared | 222,549 | 5,190,486 | 210,746 | 5,699,068 |
Shares redeemed | (591,100) | (13,963,638) | (572,934) | (15,265,541) |
NET CHANGE RESULTING FROM CLASS A SHARE TRANSACTIONS | (111,134) | $(2,700,765) | 57,718 | $1,506,780 |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Class C Shares: | Shares | Amount | Shares | Amount |
Shares sold | 66,467 | $1,392,466 | 72,936 | $1,707,022 |
Shares issued to shareholders in payment of distributions declared | 30,175 | 632,166 | 26,089 | 644,136 |
Shares redeemed | (99,398) | (2,092,438) | (96,152) | (2,345,852) |
NET CHANGE RESULTING FROM CLASS C SHARE TRANSACTIONS | (2,756) | $(67,806) | 2,873 | $5,306 |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Class R Shares: | Shares | Amount | Shares | Amount |
Shares sold | 105,904 | $2,429,746 | 114,354 | $3,033,541 |
Shares issued to shareholders in payment of distributions declared | 48,849 | 1,109,919 | 46,691 | 1,234,030 |
Shares redeemed | (132,789) | (3,035,681) | (142,239) | (3,663,821) |
NET CHANGE RESULTING FROM CLASS R SHARE TRANSACTIONS | 21,964 | $503,984 | 18,806 | $603,750 |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Institutional Shares: | Shares | Amount | Shares | Amount |
Shares sold | 2,343,144 | $55,043,741 | 1,101,667 | $29,050,524 |
Shares issued to shareholders in payment of distributions declared | 357,951 | 8,366,945 | 288,525 | 7,813,254 |
Shares redeemed | (1,852,302) | (43,627,059) | (965,535) | (25,232,564) |
NET CHANGE RESULTING FROM INSTITUTIONAL SHARE TRANSACTIONS | 848,793 | $19,783,627 | 424,657 | $11,631,214 |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Class R6 Shares: | Shares | Amount | Shares | Amount |
Shares sold | 478,904 | $11,317,502 | 83,640 | $2,229,568 |
Shares issued to shareholders in payment of distributions declared | 20,329 | 474,884 | 21,573 | 584,408 |
Shares redeemed | (337,768) | (7,806,702) | (122,453) | (3,203,076) |
NET CHANGE RESULTING FROM CLASS R6 SHARE TRANSACTIONS | 161,465 | $3,985,684 | (17,240) | $(389,100) |
NET CHANGE RESULTING FROM TOTAL FUND SHARE TRANSACTIONS | 918,332 | $21,504,724 | 486,814 | $13,357,950 |
2023 | 2022 | |
Ordinary income1 | $654,104 | $5,094,068 |
Long-term capital gains | $15,609,167 | $11,410,359 |
1 | For tax purposes, short-term capital gain distributions are considered ordinary income distributions. |
Undistributed ordinary income | $1,791,810 |
Net unrealized appreciation | $3,882,427 |
Undistributed long-term capital gains | $3,487,002 |
TOTAL | $9,161,239 |
Administrative Fee | Average Daily Net Assets of the Investment Complex |
0.100% | on assets up to $50 billion |
0.075% | on assets over $50 billion |
Percentage of Average Daily Net Assets of Class | |
Class A Shares | 0.05% |
Class C Shares | 0.75% |
Class R Shares | 0.50% |
Distribution Services Fees Incurred | Distribution Services Fees Waived | |
Class C Shares | $53,251 | $— |
Class R Shares | 64,908 | (19,472) |
TOTAL | $118,159 | $(19,472) |
.
Purchases | $187,500,974 |
Sales | $178,753,445 |
November 22, 2023
Beginning Account Value 4/1/2023 | Ending Account Value 9/30/2023 | Expenses Paid During Period1 | |
Actual: | |||
Class A Shares | $1,000 | $973.80 | $5.59 |
Class C Shares | $1,000 | $970.30 | $9.48 |
Class R Shares | $1,000 | $973.60 | $6.04 |
Institutional Shares | $1,000 | $975.60 | $4.36 |
Class R6 Shares | $1,000 | $975.60 | $4.01 |
Hypothetical (assuming a 5% return before expenses): | |||
Class A Shares | $1,000 | $1,019.40 | $5.72 |
Class C Shares | $1,000 | $1,015.44 | $9.70 |
Class R Shares | $1,000 | $1,018.95 | $6.17 |
Institutional Shares | $1,000 | $1,020.66 | $4.46 |
Class R6 Shares | $1,000 | $1,021.01 | $4.10 |
1 | Expenses are equal to the Fund’s annualized net expense ratios, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half-year period). The annualized net expense ratios are as follows: |
Class A Shares | 1.13% |
Class C Shares | 1.92% |
Class R Shares | 1.22% |
Institutional Shares | 0.88% |
Class R6 Shares | 0.81% |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s) |
J. Christopher Donahue* Birth Date: April 11, 1949 President and Trustee Indefinite Term Began serving: September 1999 | Principal Occupations: Principal Executive Officer and President of certain of the Funds in the Federated Hermes Fund Family; Director or Trustee of the Funds in the Federated Hermes Fund Family; President, Chief Executive Officer and Director, Federated Hermes, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman and Trustee, Federated Equity Management Company of Pennsylvania; Trustee, Federated Shareholder Services Company; Director, Federated Services Company. Previous Positions: President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd; Chairman, Passport Research, Ltd. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s) |
John B. Fisher* Birth Date: May 16, 1956 Trustee Indefinite Term Began serving: May 2016 | Principal Occupations: Principal Executive Officer and President of certain of the Funds in the Federated Hermes Fund Family; Director or Trustee of certain of the Funds in the Federated Hermes Fund Family; Director and Vice President, Federated Hermes, Inc.; President, Director/Trustee and CEO, Federated Advisory Services Company, Federated Equity Management Company of Pennsylvania, Federated Global Investment Management Corp., Federated Investment Counseling, Federated Investment Management Company, and Federated MDTA LLC; Director, Federated Investors Trust Company. Previous Positions: President and Director of the Institutional Sales Division of Federated Securities Corp.; President and CEO of Passport Research, Ltd.; Director and President, Technology, Federated Services Company. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
John T. Collins Birth Date: January 24, 1947 Trustee Indefinite Term Began serving: October 2013 | Principal Occupations: Director or Trustee, and Chair of the Board of Directors or Trustees, of the Federated Hermes Fund Family; formerly, Chairman and CEO, The Collins Group, Inc. (a private equity firm) (Retired). Other Directorships Held: Director, KLX Energy Services Holdings, Inc. (oilfield services); former Director of KLX Corp. (aerospace). Qualifications: Mr. Collins has served in several business and financial management roles and directorship positions throughout his career. Mr. Collins previously served as Chairman and CEO of The Collins Group, Inc. (a private equity firm) and as a Director of KLX Corp. Mr. Collins serves as Chairman Emeriti, Bentley University. Mr. Collins previously served as Director and Audit Committee Member, Bank of America Corp.; Director, FleetBoston Financial Corp.; and Director, Beth Israel Deaconess Medical Center (Harvard University Affiliate Hospital). |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
G. Thomas Hough Birth Date: February 28, 1955 Trustee Indefinite Term Began serving: August 2015 | Principal Occupations: Director or Trustee, Chair of the Audit Committee of the Federated Hermes Fund Family; formerly, Vice Chair, Ernst & Young LLP (public accounting firm) (Retired). Other Directorships Held: Director, Chair of the Audit Committee, Equifax, Inc.; Lead Director, Member of the Audit and Nominating and Corporate Governance Committees, Haverty Furniture Companies, Inc.; formerly, Director, Member of Governance and Compensation Committees, Publix Super Markets, Inc. Qualifications: Mr. Hough has served in accounting, business management and directorship positions throughout his career. Mr. Hough most recently held the position of Americas Vice Chair of Assurance with Ernst & Young LLP (public accounting firm). Mr. Hough serves on the President’s Cabinet and Business School Board of Visitors for the University of Alabama. Mr. Hough previously served on the Business School Board of Visitors for Wake Forest University, and he previously served as an Executive Committee member of the United States Golf Association. |
Maureen Lally-Green Birth Date: July 5, 1949 Trustee Indefinite Term Began serving: August 2009 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; Adjunct Professor Emerita of Law, Duquesne University School of Law; formerly, Dean of the Duquesne University School of Law and Professor of Law and Interim Dean of the Duquesne University School of Law; formerly, Associate General Secretary and Director, Office of Church Relations, Diocese of Pittsburgh. Other Directorships Held: Director, CNX Resources Corporation (natural gas). Qualifications: Judge Lally-Green has served in various legal and business roles and directorship positions throughout her career. Judge Lally-Green previously held the position of Dean of the School of Law of Duquesne University (as well as Interim Dean). Judge Lally-Green previously served as Associate General Secretary of the Diocese of Pittsburgh, a member of the Superior Court of Pennsylvania and as a Professor of Law, Duquesne University School of Law. Judge Lally- Green was appointed by the Supreme Court of Pennsylvania to serve on the Supreme Court’s Board of Continuing Judicial Education and the Supreme Court’s Appellate Court Procedural Rules Committee. Judge Lally-Green also currently holds the positions on not for profit or for profit boards of directors as follows: Director and Chair, UPMC Mercy Hospital; Regent, Saint Vincent Seminary; Member, Pennsylvania State Board of Education (public); Director, Catholic Charities, Pittsburgh; and Director CNX Resources Corporation (natural gas). Judge Lally-Green has held the positions of: Director, Auberle; Director, Epilepsy Foundation of Western and Central Pennsylvania; Director, Ireland Institute of Pittsburgh; Director, Saint Thomas More Society; Director and Chair, Catholic High Schools of the Diocese of Pittsburgh, Inc.; Director, Pennsylvania Bar Institute; Director, St. Vincent College; Director and Chair, North Catholic High School, Inc.; Director and Vice Chair, Our Campaign for the Church Alive!, Inc.; and Director and Vice Chair, Saint Francis University. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
Thomas M. O’Neill Birth Date: June 14, 1951 Trustee Indefinite Term Began serving: August 2006 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; Sole Proprietor, Navigator Management Company (investment and strategic consulting). Other Directorships Held: None. Qualifications: Mr. O’Neill has served in several business, mutual fund and financial management roles and directorship positions throughout his career. Mr. O’Neill serves as Director, Medicines for Humanity. Mr. O’Neill previously served as Chief Executive Officer and President, Managing Director and Chief Investment Officer, Fleet Investment Advisors; President and Chief Executive Officer, Aeltus Investment Management, Inc.; General Partner, Hellman, Jordan Management Co., Boston, MA; Chief Investment Officer, The Putnam Companies, Boston, MA; Credit Analyst and Lending Officer, Fleet Bank; Director and Consultant, EZE Castle Software (investment order management software); Director, Midway Pacific (lumber); and Director, The Golisano Children’s Museum of Naples, Florida. |
Madelyn A. Reilly Birth Date: February 2, 1956 Trustee Indefinite Term Began serving: November 2020 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; formerly, Senior Vice President for Legal Affairs, General Counsel and Secretary of Board of Directors, Duquesne University (Retired). Other Directorships Held: None. Qualifications: Ms. Reilly has served in various business and legal management roles throughout her career. Ms. Reilly previously served as Senior Vice President for Legal Affairs, General Counsel and Secretary of Board of Directors and Director of Risk Management and Associate General Counsel, Duquesne University. Prior to her work at Duquesne University, Ms. Reilly served as Assistant General Counsel of Compliance and Enterprise Risk as well as Senior Counsel of Environment, Health and Safety, PPG Industries. Ms. Reilly currently serves as a member of the Board of Directors of UPMC Mercy Hospital. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
P. Jerome Richey Birth Date: February 23, 1949 Trustee Indefinite Term Began serving: October 2013 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; Retired; formerly, Senior Vice Chancellor and Chief Legal Officer, University of Pittsburgh and Executive Vice President and Chief Legal Officer, CONSOL Energy Inc. (now split into two separate publicly traded companies known as CONSOL Energy Inc. and CNX Resources Corp.). Other Directorships Held: None. Qualifications: Mr. Richey has served in several business and legal management roles and directorship positions throughout his career. Mr. Richey most recently held the positions of Senior Vice Chancellor and Chief Legal Officer, University of Pittsburgh. Mr. Richey previously served as Chairman of the Board, Epilepsy Foundation of Western Pennsylvania and Chairman of the Board, World Affairs Council of Pittsburgh. Mr. Richey previously served as Chief Legal Officer and Executive Vice President, CONSOL Energy Inc. and CNX Gas Company; and Board Member, Ethics Counsel and Shareholder, Buchanan Ingersoll & Rooney PC (a law firm). |
John S. Walsh Birth Date: November 28, 1957 Trustee Indefinite Term Began serving: January 1999 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. Other Directorships Held: None. Qualifications: Mr. Walsh has served in several business management roles and directorship positions throughout his career. Mr. Walsh previously served as Vice President, Walsh & Kelly, Inc. (paving contractors). |
Name Birth Date Address Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years and Previous Position(s) |
Lori A. Hensler Birth Date: January 6, 1967 TREASURER Officer since: April 2013 | Principal Occupations: Principal Financial Officer and Treasurer of the Federated Hermes Fund Family; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp.; and Assistant Treasurer, Federated Investors Trust Company. Ms. Hensler has received the Certified Public Accountant designation. Previous Positions: Controller of Federated Hermes, Inc.; Senior Vice President and Assistant Treasurer, Federated Investors Management Company; Treasurer, Federated Investors Trust Company; Assistant Treasurer, Federated Administrative Services, Federated Administrative Services, Inc., Federated Securities Corp., Edgewood Services, Inc., Federated Advisory Services Company, Federated Equity Management Company of Pennsylvania, Federated Global Investment Management Corp., Federated Investment Counseling, Federated Investment Management Company, Passport Research, Ltd., and Federated MDTA, LLC; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc. |
Peter J. Germain Birth Date: September 3, 1959 CHIEF LEGAL OFFICER, SECRETARY and EXECUTIVE VICE PRESIDENT Officer since: January 2005 | Principal Occupations: Mr. Germain is Chief Legal Officer, Secretary and Executive Vice President of the Federated Hermes Fund Family. He is General Counsel, Chief Legal Officer, Secretary and Executive Vice President, Federated Hermes, Inc.; Trustee and Senior Vice President, Federated Investors Management Company; Trustee and President, Federated Administrative Services; Director and President, Federated Administrative Services, Inc.; Director and Vice President, Federated Securities Corp.; Director and Secretary, Federated Private Asset Management, Inc.; Secretary, Federated Shareholder Services Company; and Secretary, Retirement Plan Service Company of America. Mr. Germain joined Federated Hermes, Inc. in 1984 and is a member of the Pennsylvania Bar Association. Previous Positions: Deputy General Counsel, Special Counsel, Managing Director of Mutual Fund Services, Federated Hermes, Inc.; Senior Vice President, Federated Services Company; and Senior Corporate Counsel, Federated Hermes, Inc. |
Stephen Van Meter Birth Date: June 5, 1975 CHIEF COMPLIANCE OFFICER AND SENIOR VICE PRESIDENT Officer since: July 2015 | Principal Occupations: Senior Vice President and Chief Compliance Officer of the Federated Hermes Fund Family; Vice President and Chief Compliance Officer of Federated Hermes, Inc. and Chief Compliance Officer of certain of its subsidiaries. Mr. Van Meter joined Federated Hermes, Inc. in October 2011. He holds FINRA licenses under Series 3, 7, 24 and 66. Previous Positions: Mr. Van Meter previously held the position of Compliance Operating Officer, Federated Hermes, Inc. Prior to joining Federated Hermes, Inc., Mr. Van Meter served at the United States Securities and Exchange Commission in the positions of Senior Counsel, Office of Chief Counsel, Division of Investment Management and Senior Counsel, Division of Enforcement. |
Name Birth Date Address Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years and Previous Position(s) |
Stephen F. Auth Birth Date: September 13, 1956 101 Park Avenue 41st Floor New York, NY 10178 CHIEF INVESTMENT OFFICER Officer since: November 2002 | Principal Occupations: Stephen F. Auth is Chief Investment Officer of various Funds in the Federated Hermes Fund Family; Executive Vice President, Federated Investment Counseling, Federated Global Investment Management Corp. and Federated Equity Management Company of Pennsylvania. Previous Positions: Executive Vice President, Federated Investment Management Company and Passport Research, Ltd. (investment advisory subsidiary of Federated); Senior Vice President, Global Portfolio Management Services Division; Senior Vice President, Federated Investment Management Company and Passport Research, Ltd.; Senior Managing Director and Portfolio Manager, Prudential Investments. |
Annual Evaluation of Adequacy and Effectiveness
Federated Hermes Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
or call 1-800-341-7400.
CUSIP 314172271
CUSIP 314172172
CUSIP 314172263
CUSIP 31421N808
Share Class | Ticker | A | BEARX | C | PBRCX | Institutional | PBRIX |
Federated Hermes Prudent Bear Fund
A Portfolio of Federated Hermes Equity Funds
1 Year | 5 Years | 10 Years | |
Class A Shares | -22.37% | -12.57% | -13.62% |
Class C Shares | -19.31% | -12.23% | -13.66% |
Institutional Shares | -17.65% | -11.37% | -12.93% |
S&P 500 | 21.62% | 9.92% | 11.92% |
S&P 500 Inverse | -12.33% | -10.21% | -11.38% |
Percentage of Total Net Assets | |
Securities Sold Short | (55.4)% |
Derivative Contracts—Short (notional value)1 | (44.3)% |
U.S. Treasury Securities | 71.6% |
Common Stocks | 15.5% |
Exchange-Traded Fund | 0.2% |
Other Security Type2 | 0.5% |
Cash Equivalents3 | 12.1% |
Adjustment for Derivative Contracts (notional value)1 | 51.1% |
Collateral on Deposit for Securities Sold Short | 48.6% |
Other Assets and Liabilities—Net4 | 0.1% |
TOTAL | 100% |
Sector Composition | Percentage of Total Securities Sold Short6 |
Broad Equity Index | 91.8% |
Information Technology | 1.2% |
Financials | 1.2% |
Industrials | 1.1% |
Consumer Discretionary | 1.0% |
Health Care | 0.9% |
Consumer Staples | 0.8% |
Real Estate | 0.6% |
Utilities | 0.4% |
Energy | 0.4% |
Communication Services | 0.3% |
Materials | 0.3% |
TOTAL | 100% |
1 | Derivative contracts may consist of futures, forwards, written options and swaps. More complete information regarding the Fund’s direct investments in derivative contracts, including unrealized appreciation (depreciation), value and notional values or amounts of such contracts, can be found in the table at the end of the Portfolio of Investments included in this Report. |
2 | Other Security Type consists of purchased put options. |
3 | Cash Equivalents include any investments in money market mutual funds and/or overnight repurchase agreements. |
4 | Assets, other than investments in securities, securities sold short, derivative contracts and collateral on deposit for securities sold short, less liabilities. See Statement of Assets and Liabilities. |
5 | Sector classifications are based upon, and individual portfolio securities are assigned to, the classifications of the Global Industry Classification Standard (GICS) except that the Adviser assigns a classification to securities not classified by the GICS and to securities for which the Adviser does not have access to the classification made by the GICS. |
6 | Includes any short positions on futures contracts. |
Shares, Principal Amount or Contracts | Value | ||
U.S. TREASURIES— 71.6% | |||
U.S. Treasury Bills— 71.6% | |||
$170,000,000 | United States Treasury Bill, 5.253%, 10/19/2023 | $169,575,330 | |
150,000,000 | United States Treasury Bill, 5.271%, 2/15/2024 | 146,995,959 | |
TOTAL U.S. TREASURIES (IDENTIFIED COST $316,544,632) | 316,571,289 | ||
COMMON STOCKS— 15.5% | |||
1 | Communication Services— 0.8% | ||
12,000 | Alphabet, Inc., Class A | 1,570,320 | |
10,000 | Match Group, Inc. | 391,750 | |
2,800 | Meta Platforms, Inc. | 840,588 | |
30,000 | TripAdvisor, Inc. | 497,400 | |
24,000 | ZoomInfo Technologies, Inc. | 393,600 | |
TOTAL | 3,693,658 | ||
Consumer Discretionary— 1.2% | |||
140,000 | 1 | Allbirds, Inc. | 155,400 |
10,000 | 1 | Amazon.com, Inc. | 1,271,200 |
120,000 | 1 | Brilliant Earth Group, Inc. | 354,000 |
6,000 | 1 | Crocs, Inc. | 529,380 |
260,000 | Dr. Martens PLC | 447,483 | |
14,000 | eBay, Inc. | 617,260 | |
10,000 | 1 | Etsy, Inc. | 645,800 |
4,000 | 1 | Expedia Group, Inc. | 412,280 |
64,000 | 1 | Lottomatica Group S.p.A. | 595,856 |
24,000 | 1 | Savers Value Village, Inc. | 448,080 |
TOTAL | 5,476,739 | ||
Consumer Staples— 1.4% | |||
20,000 | Altria Group, Inc. | 841,000 | |
10,000 | 1 | BJ’s Wholesale Club Holdings, Inc. | 713,700 |
30,000 | 1 | Hain Celestial Group, Inc. | 311,100 |
6,000 | Kimberly-Clark Corp. | 725,100 | |
11,000 | Kroger Co. | 492,250 | |
10,000 | 1 | Maplebear, Inc. | 296,900 |
18,000 | 1 | Oddity Tech Ltd. | 510,300 |
6,000 | Philip Morris International, Inc. | 555,480 | |
200,000 | 1 | RLX Technology, Inc., ADR | 302,000 |
5,000 | WalMart, Inc. | 799,650 | |
300,000 | 1 | ZJLD Group, Inc. | 458,949 |
TOTAL | 6,006,429 |
Shares, Principal Amount or Contracts | Value | ||
COMMON STOCKS— continued | |||
Energy— 0.3% | |||
2,000 | Pioneer Natural Resources, Inc. | $ 459,100 | |
20,000 | Sitio Royalties Corp. | 484,200 | |
12,000 | TXO Partners, LP | 243,720 | |
TOTAL | 1,187,020 | ||
Financials— 2.0% | |||
14,000 | Ally Financial, Inc. | 373,520 | |
3,200 | American Express Co. | 477,408 | |
420,000 | 1 | Cab Payments Holdings Ltd. | 1,184,583 |
33,334 | Corebridge Financial, Inc. | 658,346 | |
3,400 | 1 | Fiserv, Inc. | 384,064 |
2,000 | Goldman Sachs Group, Inc. | 647,140 | |
5,000 | Hartford Financial Services Group, Inc. | 354,550 | |
5,000 | JPMorgan Chase & Co. | 725,100 | |
6,000 | Morgan Stanley | 490,020 | |
40,000 | 1 | Nuvei Corp. | 600,000 |
50,000 | 1 | Oportun Financial Corp. | 361,000 |
20,000 | Patria Investments Ltd. | 291,600 | |
8,000 | 1 | PayPal Holdings, Inc. | 467,680 |
14,000 | Unum Group | 688,660 | |
60,000 | Vinci Partners Investments Ltd. | 612,000 | |
2,400 | Visa, Inc., Class A | 552,024 | |
TOTAL | 8,867,695 | ||
Health Care— 3.9% | |||
200,000 | 1 | AbCellera Biologics, Inc. | 920,000 |
80,000 | 1 | Adaptive Biotechnologies Corp. | 436,000 |
400,000 | 1 | Adicon Holdings LTD | 819,782 |
40,000 | 1 | Alector, Inc. | 259,200 |
60,000 | 1 | Arcutis Biotherapeutics, Inc. | 318,600 |
10,000 | 1 | Beam Therapeutics, Inc. | 240,500 |
8,000 | 1 | BioNTech SE, ADR | 869,120 |
8,000 | Bristol-Myers Squibb Co. | 464,320 | |
10,000 | 1 | Centene Corp. | 688,800 |
20,000 | 1 | Cullinan Management, Inc. | 181,000 |
40,000 | 1 | CureVac B.V. | 273,200 |
10,000 | CVS Health Corp. | 698,200 | |
6,000 | 1 | Dexcom, Inc. | 559,800 |
40,000 | 1 | Dynavax Technologies Corp. | 590,800 |
1,000 | Elevance Health, Inc. | 435,420 | |
80,000 | 1 | Ex Scientia Ltd., ADR | 361,600 |
100,000 | 1 | Fusion Pharmaceuticals, Inc. | 260,000 |
3,000 | Gilead Sciences, Inc. | 224,820 |
Shares, Principal Amount or Contracts | Value | ||
COMMON STOCKS— continued | |||
Health Care— continued | |||
8,000 | 1 | Hologic, Inc. | $ 555,200 |
7,000 | 1 | Inari Medical, Inc. | 457,800 |
10,000 | 1 | Inmode Ltd. | 304,600 |
20,000 | 1 | Mineralys Therapeutics, Inc. | 190,200 |
16,000 | 1 | Mirum Pharmaceuticals, Inc. | 505,600 |
4,000 | 1 | Moderna, Inc. | 413,160 |
160,000 | 1 | Noile-Immune Biotech, Inc. | 473,534 |
20,000 | 1 | Outset Medical, Inc. | 217,600 |
16,000 | Pfizer, Inc. | 530,720 | |
10,000 | 1 | Privia Health Group, Inc. | 230,000 |
10,000 | 1 | Progyny, Inc. | 340,200 |
20,000 | 1 | Recursion Pharmaceuticals, Inc. | 153,000 |
600 | 1 | Regeneron Pharmaceuticals, Inc. | 493,776 |
60,000 | 1 | Reneo Pharmaceuticals, Inc. | 456,900 |
20,000 | Royalty Pharma PLC | 542,800 | |
60,000 | 1 | Sagimet Biosciences, Inc. | 528,000 |
4,000 | 1 | Schrodinger, Inc. | 113,080 |
60,000 | 1 | Sight Sciences, Inc. | 202,200 |
120,000 | 1 | Sonendo, Inc. | 89,496 |
160,000 | 1 | SOPHiA GENETICS S.A. | 408,000 |
10,000 | 1 | Structure Therapeutics, Inc., ADR | 504,200 |
2,000 | UnitedHealth Group, Inc. | 1,008,380 | |
TOTAL | 17,319,608 | ||
Industrials— 1.1% | |||
60,000 | Aris Water Solutions, Inc. | 598,800 | |
160,000 | 1 | Byrna Technologies, Inc. | 358,400 |
65,000 | 1 | Eurogroup Laminations S.p.A. | 287,203 |
1,600 | 1 | Paylocity Corp. | 290,720 |
6,000 | Science Applications International Corp. | 633,240 | |
40,000 | 1 | Skymark Airlines, Inc. | 288,241 |
50,000 | 1 | TDCX, Inc., ADR | 295,500 |
50,000 | 1 | TELUS International (CDA), Inc. | 381,000 |
8,000 | Textron, Inc. | 625,120 | |
115,400 | 1 | TRYT, Inc. | 584,490 |
3,000 | United Parcel Service, Inc. | 467,610 | |
TOTAL | 4,810,324 | ||
Information Technology— 3.1% | |||
1,000 | 1 | Adobe, Inc. | 509,900 |
6,000 | 1 | Akamai Technologies, Inc. | 639,240 |
4,000 | Apple, Inc. | 684,840 | |
130,000 | 1 | Arteris, Inc. | 846,300 |
Shares, Principal Amount or Contracts | Value | ||
COMMON STOCKS— continued | |||
Information Technology— continued | |||
2,000 | 1 | Autodesk, Inc. | $ 413,820 |
40,000 | 1 | Cambium Networks Corp. | 293,200 |
20,000 | 1 | Cerence, Inc. | 407,400 |
4,000 | 1 | Check Point Software Technologies Ltd. | 533,120 |
400,000 | 1 | Cint Group AB | 366,850 |
120,000 | 1 | Copperleaf Technologies, Inc. | 499,172 |
20,000 | 1 | Credo Technology Group Holding Ltd. | 305,000 |
16,000 | 1 | DocuSign, Inc. | 672,000 |
4,000 | 1 | Enphase Energy, Inc. | 480,600 |
6,000 | 1 | GoDaddy, Inc. | 446,880 |
75,000 | 1 | Integral Corp. | 1,084,549 |
40,000 | 1 | IONOS SE | 606,199 |
120,000 | 1 | LifeSpeak, Inc. | 41,524 |
2,000 | Microsoft Corp. | 631,500 | |
2,000 | NVIDIA Corp. | 869,980 | |
5,000 | Qualcomm, Inc. | 555,300 | |
3,000 | 1 | Salesforce, Inc. | 608,340 |
55,000 | 1 | SimilarWeb Ltd. | 356,400 |
80,000 | 1 | SkyWater Technology, Inc. | 481,600 |
3,000 | 1 | Solaredge Technologies, Inc. | 388,530 |
3,000 | 1 | Splunk, Inc. | 438,750 |
30,000 | 1 | UiPath, Inc. | 513,300 |
TOTAL | 13,674,294 | ||
Materials— 1.1% | |||
8,000 | CF Industries Holdings, Inc. | 685,920 | |
2,000 | Eagle Materials, Inc. | 333,040 | |
70,000 | 1 | Gatos Silver, Inc. | 362,600 |
50,000 | 1 | Lithium Royalty Corp. | 418,185 |
12,000 | Mosaic Co./The | 427,200 | |
5,000 | Olin Corp. | 249,900 | |
100,000 | 1 | Sprott Physical Gold Trust | 1,432,000 |
120,000 | 1 | Sprott Physical Silver Trust | 909,600 |
TOTAL | 4,818,445 | ||
Real Estate— 0.1% | |||
25,000 | Host Hotels & Resorts, Inc. | 401,750 | |
Utilities— 0.5% | |||
20,000 | Brookfield Renewable Corp. | 478,800 | |
10,000 | National Fuel Gas Co. | 519,100 | |
25,000 | PPL Corp. | 589,000 |
Shares, Principal Amount or Contracts | Value | ||
COMMON STOCKS— continued | |||
Utilities— continued | |||
20,000 | UGI Corp. | $ 460,000 | |
TOTAL | 2,046,900 | ||
TOTAL COMMON STOCKS (IDENTIFIED COST $76,666,473) | 68,302,862 | ||
1 | PURCHASED PUT OPTIONS— 0.5% | ||
1,000 | SPDR S&P 500 ETF Trust (PUT-Option), Notional Amount $42,748,000, Exercise Price $425, Expiration Date 10/4/2023 | 159,268 | |
2,000 | SPDR S&P 500 ETF Trust (PUT-Option), Notional Amount $85,496,000, Exercise Price $410, Expiration Date 10/6/2023 | 59,000 | |
2,000 | SPDR S&P 500 ETF Trust (PUT-Option), Notional Amount $85,496,000, Exercise Price $415. Expiration Date 10/20/2023 | 321,841 | |
3,000 | SPDR S&P 500 ETF Trust (PUT-Option), Notional Amount $128,244,000, Exercise Price $400, Expiration Date 11/17/2023 | 738,000 | |
3,000 | SPDR S&P 500 ETF Trust (PUT-Option), Notional Amount $128,244,000, Exercise Price $410, Expiration Date 10/4/2023 | 40,500 | |
3,000 | SPDR S&P 500 ETF Trust (PUT-Option), Notional Amount $128,244,000, Exercise Price $420, Expiration Date 10/13/2023 | 486,363 | |
4,000 | SPDR S&P 500 ETF Trust (PUT-Option), Notional Amount $170,992,000, Exercise Price $420, Expiration Date 10/6/2023 | 494,000 | |
TOTAL PURCHASED PUT OPTIONS (IDENTIFIED COST $2,453,638) | 2,298,972 | ||
EXCHANGE-TRADED FUND— 0.2% | |||
40,000 | Vaneck Vectors Gold Miners ETF (IDENTIFIED COST $1,239,808) | 1,076,400 | |
INVESTMENT COMPANY— 12.1% | |||
53,427,461 | Federated Hermes Government Obligations Fund, Premier Shares, 5.25%2 (IDENTIFIED COST $53,427,461) | $53,427,461 | |
TOTAL INVESTMENT IN SECURITIES—99.9% (IDENTIFIED COST $450,332,012)3 | 441,676,984 | ||
OTHER ASSETS AND LIABILITIES - NET—0.1%4 | 534,953 | ||
TOTAL NET ASSETS—100% | $442,211,937 |
Shares | Value | ||
Broad Equity Index— (47.2)% | |||
65,000 | 1 | ARK Fintech Innovation ETF | $ 1,258,400 |
40,000 | 1 | ARK Innovation ETF | 1,586,800 |
87,000 | iShares FTSE/Xinhua China 25 | 2,308,110 | |
50,000 | iShares MSCI Canada Index Fund | 1,673,000 | |
53,000 | iShares MSCI Emerging Markets ETF | 2,011,350 | |
120,000 | iShares MSCI Hong Kong Index Fund | 2,058,000 | |
8,000 | iShares MSCI Japan ETF | 482,320 |
Shares | Value | ||
Broad Equity Index— continued | |||
81,000 | iShares MSCI United Kingdom | $ 2,562,840 | |
58,300 | iShares Russell 2000 ETF | 10,303,942 | |
413,000 | S&P Depositary Receipts Trust | 176,549,240 | |
10,500 | SPDR Dow Jones Industrial Average ETF Trust | 3,516,975 | |
75,000 | Vanguard European ETF | 4,344,750 | |
TOTAL | 208,655,727 | ||
Communication Services— (0.3)% | |||
4,500 | 1 | Liberty Broadband Corp. | 410,940 |
5,000 | 1 | Liberty Media Corp - Liberty Formula One | 311,500 |
214 | 1 | Liberty Media Corp - Liberty Live | 6,869 |
4,400 | Omnicom Group, Inc. | 327,712 | |
22,100 | Paramount Global, Class B | 285,090 | |
1,700 | Walt Disney Co. | 137,785 | |
TOTAL | 1,479,896 | ||
Consumer Discretionary— (1.0)% | |||
9,000 | Aramark | 312,300 | |
2,500 | 1 | Bright Horizons Family Solutions, Inc. | 203,650 |
3,000 | 1 | CarMax, Inc. | 212,190 |
2,100 | Churchill Downs, Inc. | 243,684 | |
4,300 | Columbia Sportswear Co. | 318,630 | |
4,000 | 1 | Floor & Decor Holdings, Inc. | 362,000 |
30,000 | Ford Motor Co. | 372,600 | |
1,600 | Genuine Parts Co. | 231,008 | |
4,000 | Hasbro, Inc. | 264,560 | |
1,000 | Lithia Motors, Inc. | 295,330 | |
20,000 | Macy’s, Inc. | 232,200 | |
3,000 | Marriott Vacations Worldwide Corp. | 301,890 | |
6,000 | Service Corp. International | 342,840 | |
35,000 | 1 | Under Armour, Inc., Class A | 239,750 |
17,000 | V.F. Corp. | 300,390 | |
TOTAL | 4,233,022 | ||
Consumer Staples— (0.8)% | |||
4,000 | Bunge Ltd. | 433,000 | |
9,000 | Conagra Brands, Inc. | 246,780 | |
2,000 | Dollar General Corp. | 211,600 | |
11,000 | Hormel Foods Corp. | 418,330 | |
6,000 | Keurig Dr Pepper, Inc. | 189,420 | |
8,000 | Kraft Heinz Co./The | 269,120 | |
2,400 | Lamb Weston Holdings, Inc. | 221,904 | |
12,000 | 1 | Pilgrim’s Pride Corp. | 273,960 |
3,000 | 1 | Post Holdings, Inc. | 257,220 |
7,500 | Tyson Foods, Inc., Class A | 378,675 | |
17,000 | Walgreens Boots Alliance, Inc. | 378,080 | |
TOTAL | 3,278,089 |
Shares | Value | ||
Energy— (0.4)% | |||
6,000 | DT Midstream, Inc. | $ 317,520 | |
7,000 | New Fortress Energy, Inc. | 229,460 | |
16,000 | NOV, Inc. | 334,400 | |
5,000 | Ovintiv, Inc. | 237,850 | |
4,000 | Schlumberger Ltd. | 233,200 | |
6,000 | Williams Cos., Inc. | 202,140 | |
TOTAL | 1,554,570 | ||
Financials— (1.2)% | |||
24,000 | AGNC Investment Corp. | 226,560 | |
2,000 | Allstate Corp. | 222,820 | |
18,000 | Annaly Capital Management, Inc. | 338,580 | |
3,000 | Assurant, Inc. | 430,740 | |
4,000 | Blackstone, Inc. | 428,560 | |
5,000 | 1 | Block, Inc. | 221,300 |
22,000 | Blue Owl Capital, Inc. | 285,120 | |
1,500 | CME Group, Inc. | 300,330 | |
6,000 | KKR & Co., Inc. | 369,600 | |
200 | 1 | Markel Group, Inc. | 294,498 |
4,000 | Northern Trust Corp. | 277,920 | |
2,200 | Progressive Corp., OH | 306,460 | |
5,000 | Prosperity Bancshares, Inc. | 272,900 | |
3,000 | Prudential Financial, Inc. | 284,670 | |
4,000 | Tradeweb Markets, Inc. | 320,800 | |
12,000 | Truist Financial Corp. | 343,320 | |
7,000 | U.S. Bancorp | 231,420 | |
TOTAL | 5,155,598 | ||
Health Care— (0.9)% | |||
5,000 | 1 | Acadia Healthcare Co., Inc. | 351,550 |
1,400 | 1 | Charles River Laboratories International, Inc. | 274,372 |
1,000 | Cooper Cos., Inc. | 318,010 | |
1,400 | Danaher Corp. | 347,340 | |
18,000 | 1 | Elanco Animal Health, Inc. | 202,320 |
5,000 | 1 | Enovis Corp. | 263,650 |
10,000 | 1 | Envista Holdings Corp. | 278,800 |
1,300 | 1 | Illumina, Inc. | 178,464 |
2,000 | 1 | Masimo Corp. | 175,360 |
1,000 | 1 | Penumbra, Inc. | 241,910 |
2,300 | 1 | Repligen Corp. | 365,723 |
3,000 | Revvity, Inc. | 332,100 | |
2,000 | SPDR S&P Biotech ETF | 146,040 | |
1,400 | Teleflex, Inc. | 274,974 | |
1,000 | 1 | Waters Corp. | 274,210 |
TOTAL | 4,024,823 | ||
Industrials— (1.1)% | |||
5,000 | 1 | AMERCO | 272,850 |
Shares | Value | ||
Industrials— continued | |||
5,000 | BWX Technologies, Inc. | $ 374,900 | |
20,000 | CNH Industrial NV | 242,000 | |
6,000 | Cognex Corp. | 254,640 | |
1,500 | HEICO Corp. | 242,895 | |
1,200 | IDEX Corp. | 249,624 | |
3,000 | Leidos Holdings, Inc. | 276,480 | |
30,000 | 1 | Lyft, Inc. | 316,200 |
10,000 | MDU Resources Group, Inc. | 195,800 | |
2,000 | MSA Safety, Inc. | 315,300 | |
6,000 | RB Global, Inc. | 375,000 | |
4,000 | Stanley Black & Decker, Inc. | 334,320 | |
22,000 | 1 | SunRun, Inc. | 276,320 |
1,400 | 1 | Teledyne Technologies, Inc. | 572,012 |
3,000 | Toro Co. | 249,300 | |
1,500 | 1 | WESCO International, Inc. | 215,730 |
2,000 | Woodward, Inc. | 248,520 | |
TOTAL | 5,011,891 | ||
Information Technology— (1.2)% | |||
2,000 | 1 | Advanced Micro Devices, Inc. | 205,640 |
2,700 | Analog Devices, Inc. | 472,743 | |
1,300 | 1 | Arista Networks, Inc. | 239,109 |
8,000 | Avnet, Inc. | 385,520 | |
41,000 | 1 | CCC Intelligent Solutions Holdings, Inc. | 547,350 |
1,500 | 1 | Gartner, Inc., Class A | 515,415 |
14,700 | Intel Corp. | 522,585 | |
18,000 | Juniper Networks, Inc. | 500,220 | |
5,200 | MKS Instruments, Inc. | 450,008 | |
2,400 | 1 | Take-Two Interactive Software, Inc. | 336,936 |
3,300 | Texas Instruments, Inc. | 524,733 | |
2,000 | Universal Display Corp. | 313,980 | |
9,000 | 1 | Western Digital Corp. | 410,670 |
TOTAL | 5,424,909 | ||
Materials— (0.3)% | |||
1,000 | Air Products & Chemicals, Inc. | 283,400 | |
6,000 | Ball Corp. | 298,680 | |
6,000 | Corteva, Inc. | 306,960 | |
3,500 | Crown Holdings, Inc. | 309,680 | |
4,000 | International Flavors & Fragrances, Inc. | 272,680 | |
TOTAL | 1,471,400 | ||
Real Estate— (0.6)% | |||
2,000 | Alexandria Real Estate Equities, Inc. | 200,200 | |
2,800 | Digital Realty Trust, Inc. | 338,856 | |
22,000 | Healthcare Realty Trust, Inc. | 335,940 | |
12,000 | Healthpeak Properties, Inc. | 220,320 | |
1,800 | Jones Lang LaSalle, Inc. | 254,124 |
Shares | Value | ||
Real Estate— continued | |||
10,000 | Rayonier, Inc. | $ 284,600 | |
4,500 | Realty Income Corp. | 224,730 | |
6,000 | Rexford Industrial Realty, Inc. | 296,100 | |
8,000 | Spirit Realty Capital, Inc. | 268,240 | |
4,000 | Welltower, Inc. | 327,680 | |
TOTAL | 2,750,790 | ||
Utilities— (0.4)% | |||
5,000 | Alliant Energy Corp. | 242,250 | |
4,000 | American Electric Power Co., Inc. | 300,880 | |
7,000 | Avangrid, Inc. | 211,190 | |
3,000 | Duke Energy Corp. | 264,780 | |
8,500 | FirstEnergy Corp. | 290,530 | |
2,500 | Idacorp, Inc. | 234,125 | |
4,400 | Sempra Energy | 299,332 | |
TOTAL | 1,843,087 | ||
Total Securities Sold Short (PROCEEDS $214,772,314) | $244,883,802 |
Description | Number of Contracts | Notional Value | Expiration Date | Value and Unrealized Appreciation |
Short Futures: | ||||
S&P 500 E-Mini Short Futures | 905 | $195,728,875 | December 2023 | $8,471,608 |
Affiliated | Value as of 9/30/2022 | Purchases at Cost | Proceeds from Sales |
Health Care: | |||
Dynavax Technologies Corp. | $— | $421,026 | $— |
Fusion Pharmaceuticals, Inc. | $150,500 | $116,655 | $— |
Affiliated issuers no longer in the portfolio at period end | $270,400 | $— | $(522,060) |
TOTAL OF AFFILIATED COMPANIES TRANSACTIONS | $420,900 | $537,681 | $(522,060) |
Change in Unrealized Appreciation/ (Depreciation) | Net Realized Gain/ (Loss) | Value as of 9/30/2023 | Shares Held as of 9/30/2023 | Dividend Income |
$169,774 | $— | $590,800 | 40,000 | $— |
$(7,155) | $— | $260,000 | 100,000 | $— |
$(115,327) | $366,987 | $— | — | $— |
$47,292 | $366,987 | $850,800 | 140,000 | $— |
Federated Hermes Government Obligations Fund, Premier Shares | |
Value as of 9/30/2022 | $351,982,816 |
Purchases at Cost | $1,179,796,696 |
Proceeds from Sales | $(1,478,352,051) |
Change in Unrealized Appreciation/Depreciation | $— |
Net Realized Gain/(Loss) | $— |
Value as of 9/30/2023 | $53,427,461 |
Shares Held as of 9/30/2023 | 53,427,461 |
Dividend Income | $7,628,062 |
1 | Non-income-producing security. |
2 | 7-day net yield. |
3 | The cost of investments for federal tax purposes amounts to $457,136,560. |
4 | Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. |
The following is a summary of the inputs used, as of September 30, 2023, in valuing the Fund’s assets carried at fair value:
Valuation Inputs | ||||
Level 1— Quoted Prices | Level 2— Other Significant Observable Inputs | Level 3— Significant Unobservable Inputs | Total | |
Debt Securities: | ||||
U.S. Treasuries | $— | $316,571,289 | $— | $316,571,289 |
Equity Securities: | ||||
Common Stocks | ||||
Domestic | 50,326,622 | — | — | 50,326,622 |
International | 17,976,240 | — | — | 17,976,240 |
Purchased Put Options | 2,298,972 | — | — | 2,298,972 |
Exchange-Traded Fund | 1,076,400 | — | — | 1,076,400 |
Investment Company | 53,427,461 | — | — | 53,427,461 |
TOTAL SECURITIES | $125,105,695 | $316,571,289 | $— | $441,676,984 |
Other Financial Instruments: | ||||
Assets | $8,471,608 | $— | $— | $8,471,608 |
Liabilities | (244,883,802) | — | — | (244,883,802) |
TOTAL OTHER FINANCIAL INSTRUMENTS | $(236,412,194) | $— | $— | $(236,412,194) |
The following acronym(s) are used throughout this portfolio: | ||
ADR | —American Depositary Receipt | |
CDA | —Community Development Authority | |
ETF | —Exchange-Traded Fund | |
PLC | —Public Limited Company | |
SPDR | —Standard & Poor’s Depositary Receipt |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $8.68 | $7.79 | $10.11 | $12.58 | $13.27 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.31 | (0.09) | (0.23) | (0.19) | 0.10 |
Net realized and unrealized gain (loss) | (1.86) | 0.98 | (2.09) | (2.21) | (0.79) |
Total From Investment Operations | (1.55) | 0.89 | (2.32) | (2.40) | (0.69) |
Less Distributions: | |||||
Distributions from net investment income | — | — | — | (0.07) | — |
Net Asset Value, End of Period | $7.13 | $8.68 | $7.79 | $10.11 | $12.58 |
Total Return2 | (17.86)% | 11.42% | (22.95)% | (19.15)% | (5.20)% |
Ratios to Average Net Assets: | |||||
Net expenses3 | 2.67% | 2.65% | 3.02% | 2.85% | 2.84% |
Net expenses excluding dividends and other expenses related to short sales | 1.77% | 1.78% | 1.78% | 1.78% | 1.78% |
Net investment income (loss) | 4.11% | (1.16)% | (2.68)% | (1.65)% | 0.74% |
Expense waiver/reimbursement4 | 0.03% | 0.04% | 0.11% | 0.11% | 0.09% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $62,984 | $77,378 | $40,185 | $59,987 | $53,827 |
Portfolio turnover5 | 137% | 201% | 148% | 247% | 313% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | This expense decrease is reflected in both the net expense and the net investment income (loss) ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
5 | Securities that mature are considered sales for purposes of this calculation. |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $7.46 | $6.74 | $8.81 | $10.98 | $11.67 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.22 | (0.12) | (0.25) | (0.25) | 0.002 |
Net realized and unrealized gain (loss) | (1.60) | 0.84 | (1.82) | (1.92) | (0.69) |
Total From Investment Operations | (1.38) | 0.72 | (2.07) | (2.17) | (0.69) |
Net Asset Value, End of Period | $6.08 | $7.46 | $6.74 | $8.81 | $10.98 |
Total Return3 | (18.50)% | 10.68% | (23.50)% | (19.76)% | (5.91)% |
Ratios to Average Net Assets: | |||||
Net expenses4 | 3.45% | 3.42% | 3.77% | 3.63% | 3.59% |
Net expenses excluding dividends and other expenses related to short sales | 2.52% | 2.53% | 2.53% | 2.53% | 2.53% |
Net investment income (loss) | 3.36% | (1.89)% | (3.44)% | (2.46)% | 0.01% |
Expense waiver/reimbursement5 | 0.03% | 0.04% | 0.11% | 0.11% | 0.09% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $16,981 | $17,104 | $8,018 | $12,696 | $10,422 |
Portfolio turnover6 | 137% | 201% | 148% | 247% | 313% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Represents less than $0.01. |
3 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. |
4 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
5 | This expense decrease is reflected in both the net expense and the net investment income (loss) ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
6 | Securities that mature are considered sales for purposes of this calculation. |
Year Ended September 30, | |||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $8.95 | $8.02 | $10.38 | $12.92 | $13.59 |
Income From Investment Operations: | |||||
Net investment income (loss)1 | 0.34 | (0.06) | (0.21) | (0.22) | 0.14 |
Net realized and unrealized gain (loss) | (1.92) | 0.99 | (2.15) | (2.21) | (0.81) |
Total From Investment Operations | (1.58) | 0.93 | (2.36) | (2.43) | (0.67) |
Less Distributions: | |||||
Distributions from net investment income | — | — | — | (0.11) | — |
Net Asset Value, End of Period | $7.37 | $8.95 | $8.02 | $10.38 | $12.92 |
Total Return2 | (17.65)% | 11.60% | (22.74)% | (18.97)% | (4.93)% |
Ratios to Average Net Assets: | |||||
Net expenses3 | 2.43% | 2.42% | 2.69% | 2.64% | 2.56% |
Net expenses excluding dividends and other expenses related to short sales | 1.52% | 1.53% | 1.53% | 1.53% | 1.53% |
Net investment income (loss) | 4.37% | (0.76)% | (2.38)% | (1.79)% | 1.03% |
Expense waiver/reimbursement4 | 0.03% | 0.03% | 0.11% | 0.09% | 0.09% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $362,247 | $406,207 | $116,071 | $196,933 | $77,603 |
Portfolio turnover5 | 137% | 201% | 148% | 247% | 313% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | This expense decrease is reflected in both the net expense and the net investment income (loss) ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
5 | Securities that mature are considered sales for purposes of this calculation. |
September 30, 2023
Assets: | |
Investment in securities, at value including $54,278,261 of investments in affiliated holdings* (identified cost $450,332,012, including $54,091,064 of identified cost in affiliated holdings) | $441,676,984 |
Cash denominated in foreign currencies (identified cost $501,193) | 500,543 |
Deposit at broker for short sales | 215,445,103 |
Income receivable | 63,414 |
Income receivable from affiliated holdings | 176,731 |
Interest receivable on short positions | 227,222 |
Receivable for investments sold | 30,932,788 |
Receivable for shares sold | 245,389 |
Receivable for variation margin on futures contracts | 543,023 |
Total Assets | 689,811,197 |
Liabilities: | |
Securities sold short, at value (proceeds $214,772,314) | 244,883,802 |
Dividends payable on short positions | 462,387 |
Payable for investments purchased | 1,137,489 |
Payable for shares redeemed | 792,686 |
Payable to bank | 66,899 |
Payable for investment adviser fee (Note 5) | 29,566 |
Payable for administrative fee (Note 5) | 1,885 |
Payable for distribution services fee (Note 5) | 10,044 |
Payable for other service fees (Notes 2 and 5) | 23,277 |
Accrued expenses (Note 5) | 191,225 |
Total Liabilities | 247,599,260 |
Net assets for 60,781,153 shares outstanding | $442,211,937 |
Net Assets Consist of: | |
Paid-in capital | $1,467,293,134 |
Total distributable earnings (loss) | (1,025,081,197) |
Total Net Assets | $442,211,937 |
Net Asset Value, Offering Price and Redemption Proceeds Per Share: | |
Class A Shares: | |
Net asset value per share ($62,984,450 ÷ 8,835,401 shares outstanding), no par value, unlimited shares authorized | $7.13 |
Offering price per share (100/94.50 of $7.13) | $7.54 |
Redemption proceeds per share | $7.13 |
Class C Shares: | |
Net asset value per share ($16,980,840 ÷ 2,794,837 shares outstanding), no par value, unlimited shares authorized | $6.08 |
Offering price per share | $6.08 |
Redemption proceeds per share (99.00/100 of $6.08) | $6.02 |
Institutional Shares: | |
Net asset value per share ($362,246,647 ÷ 49,150,915 shares outstanding), no par value, unlimited shares authorized | $7.37 |
Offering price per share | $7.37 |
Redemption proceeds per share | $7.37 |
* | See information listed after the Fund’s Portfolio of Investments. |
Year Ended September 30, 2023
Investment Income: | |
Interest | $25,242,082 |
Dividends (including $7,628,062 received from affiliated holdings* and net of foreign taxes withheld of $2,285) | 8,798,109 |
TOTAL INCOME | 34,040,191 |
Expenses: | |
Investment adviser fee (Note 5) | 6,260,433 |
Administrative fee (Note 5) | 393,614 |
Custodian fees | 82,448 |
Transfer agent fees | 550,813 |
Directors’/Trustees’ fees (Note 5) | 3,548 |
Auditing fees | 39,973 |
Legal fees | 11,662 |
Portfolio accounting fees | 130,773 |
Distribution services fee (Note 5) | 129,385 |
Other service fees (Notes 2 and 5) | 209,389 |
Share registration costs | 187,547 |
Printing and postage | 39,145 |
Miscellaneous (Note 5) | 28,780 |
Expenses related to short positions | 4,571,688 |
TOTAL EXPENSES | 12,639,198 |
Waiver and Reimbursement: | |
Waiver/reimbursement of investment adviser fee (Note 5) | (132,790) |
Net expenses | 12,506,408 |
Net investment income | 21,533,783 |
Realized and Unrealized Gain (Loss) on Investments, Foreign Currency Transactions, Futures Contracts and Short Sales: | |
Net realized loss on investments (including net realized gain of $366,987 on sales of investments in affiliated companies*) | $(14,493,503) |
Net realized loss on foreign currency transactions | (7,645) |
Net realized loss on futures contracts | (28,544,831) |
Net realized loss on short sales | (38,766,601) |
Net change in unrealized depreciation of investments (including net change in unrealized appreciation of $47,292 of investments in affiliated companies*) | (3,222,343) |
Net change in unrealized appreciation of translation of assets and liabilities in foreign currency | (1,166) |
Net change in unrealized appreciation of futures contracts | (7,624,566) |
Net change in unrealized appreciation of securities sold short | (38,462,069) |
Net realized and unrealized gain (loss) on investments, foreign currency transactions, futures contracts and short sales | (131,122,724) |
Change in net assets resulting from operations | $(109,588,941) |
* | See information listed after the Fund’s Portfolio of Investments. |
Year Ended September 30 | 2023 | 2022 |
Increase (Decrease) in Net Assets | ||
Operations: | ||
Net investment income (loss) | $21,533,783 | $(2,172,329) |
Net realized gain (loss) | (81,812,580) | 6,893,151 |
Net change in unrealized appreciation/depreciation | (49,310,144) | 43,531,689 |
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | (109,588,941) | 48,252,511 |
Share Transactions: | ||
Proceeds from sale of shares | 792,515,796 | 829,730,753 |
Cost of shares redeemed | (741,404,334) | (541,567,476) |
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS | 51,111,462 | 288,163,277 |
Change in net assets | (58,477,479) | 336,415,788 |
Net Assets: | ||
Beginning of period | 500,689,416 | 164,273,628 |
End of period | $442,211,937 | $500,689,416 |
Other Service Fees Incurred | |
Class A Shares | $166,261 |
Class C Shares | 43,128 |
TOTAL | $209,389 |
Fair Value of Derivative Instruments | ||
Assets | ||
Statement of Assets and Liabilities Location | Fair Value | |
Derivatives not accounted for as hedging instruments under ASC Topic 815 | ||
Equity contracts | Receivable for variation margin on futures contracts | $8,471,608* |
Equity contracts | Purchased options, within Investment in securities at value | 2,298,972 |
Total derivatives not accounted for as hedging instruments under ASC Topic 815 | $10,770,580 |
* | Includes cumulative appreciation of futures contracts as reported in the footnotes to the Portfolio of Investments. Only the current day’s variation margin is reported within the Statement of Assets and Liabilities. |
Amount of Realized Gain or (Loss) on Derivatives Recognized in Income | |||
Futures Contracts | Purchased Options Contracts1 | Total | |
Equity contracts | $(28,544,831) | $(20,895,007) | $(49,439,838) |
1 | The net realized loss on Purchased Options Contracts is found within the Net realized loss on investments on the Statement of Operations. |
Change in Unrealized Appreciation or (Depreciation) on Derivatives Recognized in Income | |||
Futures Contracts | Purchased Options Contracts1 | Total | |
Equity contracts | $(7,624,566) | $(154,666) | $(7,779,232) |
1 | The net change in unrealized depreciation of Purchased Options Contracts is found within the Net change in unrealized depreciation of investments on the Statement of Operations. |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Class A Shares: | Shares | Amount | Shares | Amount |
Shares sold | 8,442,402 | $64,910,861 | 10,138,596 | $78,466,391 |
Shares issued to shareholders in payment of distributions declared | — | — | — | — |
Shares redeemed | (8,517,826) | (65,275,868) | (6,383,541) | (49,084,686) |
NET CHANGE RESULTING FROM CLASS A SHARE TRANSACTIONS | (75,424) | $(365,007) | 3,755,055 | $29,381,705 |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Class C Shares: | Shares | Amount | Shares | Amount |
Shares sold | 1,019,988 | $6,801,995 | 1,394,372 | $9,380,660 |
Shares issued to shareholders in payment of distributions declared | — | — | — | — |
Shares redeemed | (519,081) | (3,329,965) | (289,560) | (1,853,249) |
NET CHANGE RESULTING FROM CLASS C SHARE TRANSACTIONS | 500,907 | $3,472,030 | 1,104,812 | $7,527,411 |
Year Ended 9/30/2023 | Year Ended 9/30/2022 | |||
Institutional Shares: | Shares | Amount | Shares | Amount |
Shares sold | 89,974,363 | $720,802,940 | 93,185,627 | $741,883,702 |
Shares issued to shareholders in payment of distributions declared | — | — | — | — |
Shares redeemed | (86,185,833) | (672,798,501) | (62,291,148) | (490,629,541) |
NET CHANGE RESULTING FROM INSTITUTIONAL SHARE TRANSACTIONS | 3,788,530 | $48,004,439 | 30,894,479 | $251,254,161 |
NET CHANGE RESULTING FROM TOTAL FUND SHARE TRANSACTIONS | 4,214,013 | $51,111,462 | 35,754,346 | $288,163,277 |
Increase (Decrease) | |
Paid-In Capital | Total Distributable Earnings (Loss) |
$(9,854) | $9,854 |
Undistributed ordinary income | $20,766,181 |
Net unrealized depreciation | $(45,570,570) |
Capital loss carryforwards and deferrals | $(1,000,276,808) |
TOTAL | $(1,025,081,197) |
Short-Term | Long-Term | Total |
$754,552,488 | $245,724,320 | $1,000,276,808 |
Administrative Fee | Average Daily Net Assets of the Investment Complex |
0.100% | on assets up to $50 billion |
0.075% | on assets over $50 billion |
Percentage of Average Daily Net Assets of Class | |
Class A Shares | 0.05% |
Class C Shares | 0.75% |
Distribution Services Fees Incurred | |
Class C Shares | $129,385 |
Purchases | $114,990,603 |
Sales | $80,718,174 |
November 22, 2023
Beginning Account Value 4/1/2023 | Ending Account Value 9/30/2023 | Expenses Paid During Period1 | |
Actual: | |||
Class A Shares | $1,000 | $946.90 | $12.74 |
Class C Shares | $1,000 | $944.10 | $16.42 |
Institutional Shares | $1,000 | $948.50 | $11.38 |
Hypothetical (assuming a 5% return before expenses): | |||
Class A Shares | $1,000 | $1,011.98 | $13.16 |
Class C Shares | $1,000 | $1,008.17 | $16.97 |
Institutional Shares | $1,000 | $1,013.39 | $11.76 |
1 | Expenses are equal to the Fund’s annualized net expense ratios, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half-year period). The annualized net expense ratios are as follows: |
Class A Shares | 2.61% |
Class C Shares | 3.37% |
Institutional Shares | 2.33% |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s) |
J. Christopher Donahue* Birth Date: April 11, 1949 President and Trustee Indefinite Term Began serving: September 1999 | Principal Occupations: Principal Executive Officer and President of certain of the Funds in the Federated Hermes Fund Family; Director or Trustee of the Funds in the Federated Hermes Fund Family; President, Chief Executive Officer and Director, Federated Hermes, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman and Trustee, Federated Equity Management Company of Pennsylvania; Trustee, Federated Shareholder Services Company; Director, Federated Services Company. Previous Positions: President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd; Chairman, Passport Research, Ltd. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s) |
John B. Fisher* Birth Date: May 16, 1956 Trustee Indefinite Term Began serving: May 2016 | Principal Occupations: Principal Executive Officer and President of certain of the Funds in the Federated Hermes Fund Family; Director or Trustee of certain of the Funds in the Federated Hermes Fund Family; Director and Vice President, Federated Hermes, Inc.; President, Director/Trustee and CEO, Federated Advisory Services Company, Federated Equity Management Company of Pennsylvania, Federated Global Investment Management Corp., Federated Investment Counseling, Federated Investment Management Company, and Federated MDTA LLC; Director, Federated Investors Trust Company. Previous Positions: President and Director of the Institutional Sales Division of Federated Securities Corp.; President and CEO of Passport Research, Ltd.; Director and President, Technology, Federated Services Company. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
John T. Collins Birth Date: January 24, 1947 Trustee Indefinite Term Began serving: October 2013 | Principal Occupations: Director or Trustee, and Chair of the Board of Directors or Trustees, of the Federated Hermes Fund Family; formerly, Chairman and CEO, The Collins Group, Inc. (a private equity firm) (Retired). Other Directorships Held: Director, KLX Energy Services Holdings, Inc. (oilfield services); former Director of KLX Corp. (aerospace). Qualifications: Mr. Collins has served in several business and financial management roles and directorship positions throughout his career. Mr. Collins previously served as Chairman and CEO of The Collins Group, Inc. (a private equity firm) and as a Director of KLX Corp. Mr. Collins serves as Chairman Emeriti, Bentley University. Mr. Collins previously served as Director and Audit Committee Member, Bank of America Corp.; Director, FleetBoston Financial Corp.; and Director, Beth Israel Deaconess Medical Center (Harvard University Affiliate Hospital). |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
G. Thomas Hough Birth Date: February 28, 1955 Trustee Indefinite Term Began serving: August 2015 | Principal Occupations: Director or Trustee, Chair of the Audit Committee of the Federated Hermes Fund Family; formerly, Vice Chair, Ernst & Young LLP (public accounting firm) (Retired). Other Directorships Held: Director, Chair of the Audit Committee, Equifax, Inc.; Lead Director, Member of the Audit and Nominating and Corporate Governance Committees, Haverty Furniture Companies, Inc.; formerly, Director, Member of Governance and Compensation Committees, Publix Super Markets, Inc. Qualifications: Mr. Hough has served in accounting, business management and directorship positions throughout his career. Mr. Hough most recently held the position of Americas Vice Chair of Assurance with Ernst & Young LLP (public accounting firm). Mr. Hough serves on the President’s Cabinet and Business School Board of Visitors for the University of Alabama. Mr. Hough previously served on the Business School Board of Visitors for Wake Forest University, and he previously served as an Executive Committee member of the United States Golf Association. |
Maureen Lally-Green Birth Date: July 5, 1949 Trustee Indefinite Term Began serving: August 2009 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; Adjunct Professor Emerita of Law, Duquesne University School of Law; formerly, Dean of the Duquesne University School of Law and Professor of Law and Interim Dean of the Duquesne University School of Law; formerly, Associate General Secretary and Director, Office of Church Relations, Diocese of Pittsburgh. Other Directorships Held: Director, CNX Resources Corporation (natural gas). Qualifications: Judge Lally-Green has served in various legal and business roles and directorship positions throughout her career. Judge Lally-Green previously held the position of Dean of the School of Law of Duquesne University (as well as Interim Dean). Judge Lally-Green previously served as Associate General Secretary of the Diocese of Pittsburgh, a member of the Superior Court of Pennsylvania and as a Professor of Law, Duquesne University School of Law. Judge Lally- Green was appointed by the Supreme Court of Pennsylvania to serve on the Supreme Court’s Board of Continuing Judicial Education and the Supreme Court’s Appellate Court Procedural Rules Committee. Judge Lally-Green also currently holds the positions on not for profit or for profit boards of directors as follows: Director and Chair, UPMC Mercy Hospital; Regent, Saint Vincent Seminary; Member, Pennsylvania State Board of Education (public); Director, Catholic Charities, Pittsburgh; and Director CNX Resources Corporation (natural gas). Judge Lally-Green has held the positions of: Director, Auberle; Director, Epilepsy Foundation of Western and Central Pennsylvania; Director, Ireland Institute of Pittsburgh; Director, Saint Thomas More Society; Director and Chair, Catholic High Schools of the Diocese of Pittsburgh, Inc.; Director, Pennsylvania Bar Institute; Director, St. Vincent College; Director and Chair, North Catholic High School, Inc.; Director and Vice Chair, Our Campaign for the Church Alive!, Inc.; and Director and Vice Chair, Saint Francis University. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
Thomas M. O’Neill Birth Date: June 14, 1951 Trustee Indefinite Term Began serving: October 2006 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; Sole Proprietor, Navigator Management Company (investment and strategic consulting). Other Directorships Held: None. Qualifications: Mr. O’Neill has served in several business, mutual fund and financial management roles and directorship positions throughout his career. Mr. O’Neill serves as Director, Medicines for Humanity. Mr. O’Neill previously served as Chief Executive Officer and President, Managing Director and Chief Investment Officer, Fleet Investment Advisors; President and Chief Executive Officer, Aeltus Investment Management, Inc.; General Partner, Hellman, Jordan Management Co., Boston, MA; Chief Investment Officer, The Putnam Companies, Boston, MA; Credit Analyst and Lending Officer, Fleet Bank; Director and Consultant, EZE Castle Software (investment order management software); Director, Midway Pacific (lumber); and Director, The Golisano Children’s Museum of Naples, Florida. |
Madelyn A. Reilly Birth Date: February 2, 1956 Trustee Indefinite Term Began serving: November 2020 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; formerly, Senior Vice President for Legal Affairs, General Counsel and Secretary of Board of Directors, Duquesne University (Retired). Other Directorships Held: None. Qualifications: Ms. Reilly has served in various business and legal management roles throughout her career. Ms. Reilly previously served as Senior Vice President for Legal Affairs, General Counsel and Secretary of Board of Directors and Director of Risk Management and Associate General Counsel, Duquesne University. Prior to her work at Duquesne University, Ms. Reilly served as Assistant General Counsel of Compliance and Enterprise Risk as well as Senior Counsel of Environment, Health and Safety, PPG Industries. Ms. Reilly currently serves as a member of the Board of Directors of UPMC Mercy Hospital. |
Name Birth Date Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years, Other Directorships Held, Previous Position(s) and Qualifications |
P. Jerome Richey Birth Date: February 23, 1949 Trustee Indefinite Term Began serving: October 2013 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; Retired; formerly, Senior Vice Chancellor and Chief Legal Officer, University of Pittsburgh and Executive Vice President and Chief Legal Officer, CONSOL Energy Inc. (now split into two separate publicly traded companies known as CONSOL Energy Inc. and CNX Resources Corp.). Other Directorships Held: None. Qualifications: Mr. Richey has served in several business and legal management roles and directorship positions throughout his career. Mr. Richey most recently held the positions of Senior Vice Chancellor and Chief Legal Officer, University of Pittsburgh. Mr. Richey previously served as Chairman of the Board, Epilepsy Foundation of Western Pennsylvania and Chairman of the Board, World Affairs Council of Pittsburgh. Mr. Richey previously served as Chief Legal Officer and Executive Vice President, CONSOL Energy Inc. and CNX Gas Company; and Board Member, Ethics Counsel and Shareholder, Buchanan Ingersoll & Rooney PC (a law firm). |
John S. Walsh Birth Date: November 28, 1957 Trustee Indefinite Term Began serving: January 1999 | Principal Occupations: Director or Trustee of the Federated Hermes Fund Family; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. Other Directorships Held: None. Qualifications: Mr. Walsh has served in several business management roles and directorship positions throughout his career. Mr. Walsh previously served as Vice President, Walsh & Kelly, Inc. (paving contractors). |
Name Birth Date Address Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years and Previous Position(s) |
Lori A. Hensler Birth Date: January 6, 1967 TREASURER Officer since: April 2013 | Principal Occupations: Principal Financial Officer and Treasurer of the Federated Hermes Fund Family; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp.; and Assistant Treasurer, Federated Investors Trust Company. Ms. Hensler has received the Certified Public Accountant designation. Previous Positions: Controller of Federated Hermes, Inc.; Senior Vice President and Assistant Treasurer, Federated Investors Management Company; Treasurer, Federated Investors Trust Company; Assistant Treasurer, Federated Administrative Services, Federated Administrative Services, Inc., Federated Securities Corp., Edgewood Services, Inc., Federated Advisory Services Company, Federated Equity Management Company of Pennsylvania, Federated Global Investment Management Corp., Federated Investment Counseling, Federated Investment Management Company, Passport Research, Ltd., and Federated MDTA, LLC; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc. |
Peter J. Germain Birth Date: September 3, 1959 CHIEF LEGAL OFFICER, SECRETARY and EXECUTIVE VICE PRESIDENT Officer since: January 2005 | Principal Occupations: Mr. Germain is Chief Legal Officer, Secretary and Executive Vice President of the Federated Hermes Fund Family. He is General Counsel, Chief Legal Officer, Secretary and Executive Vice President, Federated Hermes, Inc.; Trustee and Senior Vice President, Federated Investors Management Company; Trustee and President, Federated Administrative Services; Director and President, Federated Administrative Services, Inc.; Director and Vice President, Federated Securities Corp.; Director and Secretary, Federated Private Asset Management, Inc.; Secretary, Federated Shareholder Services Company; and Secretary, Retirement Plan Service Company of America. Mr. Germain joined Federated Hermes, Inc. in 1984 and is a member of the Pennsylvania Bar Association. Previous Positions: Deputy General Counsel, Special Counsel, Managing Director of Mutual Fund Services, Federated Hermes, Inc.; Senior Vice President, Federated Services Company; and Senior Corporate Counsel, Federated Hermes, Inc. |
Stephen Van Meter Birth Date: June 5, 1975 CHIEF COMPLIANCE OFFICER AND SENIOR VICE PRESIDENT Officer since: July 2015 | Principal Occupations: Senior Vice President and Chief Compliance Officer of the Federated Hermes Fund Family; Vice President and Chief Compliance Officer of Federated Hermes, Inc. and Chief Compliance Officer of certain of its subsidiaries. Mr. Van Meter joined Federated Hermes, Inc. in October 2011. He holds FINRA licenses under Series 3, 7, 24 and 66. Previous Positions: Mr. Van Meter previously held the position of Compliance Operating Officer, Federated Hermes, Inc. Prior to joining Federated Hermes, Inc., Mr. Van Meter served at the United States Securities and Exchange Commission in the positions of Senior Counsel, Office of Chief Counsel, Division of Investment Management and Senior Counsel, Division of Enforcement. |
Name Birth Date Address Positions Held with Trust Date Service Began | Principal Occupation(s) for Past Five Years and Previous Position(s) |
Stephen F. Auth Birth Date: September 13, 1956 101 Park Avenue 41st Floor New York, NY 10178 CHIEF INVESTMENT OFFICER Officer since: November 2002 | Principal Occupations: Stephen F. Auth is Chief Investment Officer of various Funds in the Federated Hermes Fund Family; Executive Vice President, Federated Investment Counseling, Federated Global Investment Management Corp. and Federated Equity Management Company of Pennsylvania. Previous Positions: Executive Vice President, Federated Investment Management Company and Passport Research, Ltd. (investment advisory subsidiary of Federated); Senior Vice President, Global Portfolio Management Services Division; Senior Vice President, Federated Investment Management Company and Passport Research, Ltd.; Senior Managing Director and Portfolio Manager, Prudential Investments. |
Annual Evaluation of Adequacy and Effectiveness
Federated Hermes Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
or call 1-800-341-7400.
CUSIP 31421N600
CUSIP 31421N501
Item 2. | Code of Ethics |
(a) As of the end of the period covered by this report, the registrant has adopted a code of ethics (the "Section 406 Standards for Investment Companies - Ethical Standards for Principal Executive and Financial Officers") that applies to the registrant's Principal Executive Officer and Principal Financial Officer; the registrant's Principal Financial Officer also serves as the Principal Accounting Officer.
(c) There was no amendment to the registrant’s code of ethics described in Item 2(a) above during the period covered by the report.
(d) There was no waiver granted, either actual or implicit, from a provision to the registrant’s code of ethics described in Item 2(a) above during the period covered by the report.
(e) Not Applicable
(f)(3) The registrant hereby undertakes to provide any person, without charge, upon request, a copy of the code of ethics. To request a copy of the code of ethics, contact the registrant at 1-800-341-7400, and ask for a copy of the Section 406 Standards for Investment Companies - Ethical Standards for Principal Executive and Financial Officers.
Item 3. Audit Committee Financial Expert
The registrant's Board has determined that each of the following members of the Board's Audit Committee is an “audit committee financial expert,” and is "independent," for purposes of this Item: G. Thomas Hough and Thomas M. O'Neill.
Item 4. | Principal Accountant Fees and Services |
(a) Audit Fees billed to the registrant for the two most recent fiscal years:
Fiscal year ended 2023 – $325,998
Fiscal year ended 2022 - $300,081
(b) Audit-Related Fees billed to the registrant for the two most recent fiscal years:
Fiscal year ended 2023 - $0
Fiscal year ended 2022 - $0
Amount requiring approval of the registrant’s Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $0 and $0 respectively.
(c) Tax Fees billed to the registrant for the two most recent fiscal years:
Fiscal year ended 2023 - $0
Fiscal year ended 2022 - $0
Amount requiring approval of the registrant’s Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $0 and $0 respectively.
(d) All Other Fees billed to the registrant for the two most recent fiscal years:
Fiscal year ended 2023 - $0
Fiscal year ended 2022 - $0
Amount requiring approval of the registrant’s Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $64,383 and $75,581 respectively. Fiscal year ended 2023- Service fees for analysis of potential Passive Foreign Investment Company holdings. Fiscal year ended 2022- Service fees for analysis of potential Passive Foreign Investment Company holdings.
(e)(1) Audit Committee Policies regarding Pre-approval of Services.
The Audit Committee is required to pre-approve audit and non-audit services performed by the independent auditor in order to assure that the provision of such services do not impair the auditor’s independence. Unless a type of service to be provided by the independent auditor has received general pre-approval, it will require specific pre-approval by the Audit Committee. Any proposed services exceeding pre-approved cost levels will require specific pre-approval by the Audit Committee.
Certain services have the general pre-approval of the Audit Committee. The term of the general pre-approval is 12 months from the date of pre-approval, unless the Audit Committee specifically provides for a different period. The Audit Committee will annually review the services that may be provided by the independent auditor without obtaining specific pre-approval from the Audit Committee and may grant general pre-approval for such services. The Audit Committee will revise the list of general pre-approved services from time to time, based on subsequent determinations. The Audit Committee will not delegate to management its responsibilities to pre-approve services performed by the independent auditor.
The Audit Committee has delegated pre-approval authority to its chairman (the “Chairman”) for services that do not exceed a specified dollar threshold. The Chairman or Chief Audit Executive will report any such pre-approval decisions to the Audit Committee at its next scheduled meeting. The Committee will designate another member with such pre-approval authority when the Chairman is unavailable.
AUDIT SERVICES
The annual audit services engagement terms and fees will be subject to the specific pre-approval of the Audit Committee. The Audit Committee will approve, if necessary, any changes in terms, conditions and fees resulting from changes in audit scope, registered investment company (RIC) structure or other matters.
In addition to the annual audit services engagement specifically approved by the Audit Committee, the Audit Committee may grant general pre-approval for other audit services, which are those services that only the independent auditor reasonably can provide. The Audit Committee has pre-approved certain audit services; with limited exception, all other audit services must be specifically pre-approved by the Audit Committee.
AUDIT-RELATED SERVICES
Audit-related services are assurance and related services that are reasonably related to the performance of the audit or review of the RIC’s financial statements or that are traditionally performed by the independent auditor. The Audit Committee believes that the provision of audit-related services does not impair the independence of the auditor, and has pre-approved certain audit-related services; all other audit-related services must be specifically pre-approved by the Audit Committee.
TAX SERVICES
The Audit Committee believes that the independent auditor can provide tax services to the RIC such as tax compliance, tax planning and tax advice without impairing the auditor’s independence. However, the Audit Committee will not permit the retention of the independent auditor in connection with a transaction initially recommended by the independent auditor, the purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Internal Revenue Code and related regulations. The Audit Committee has pre-approved certain tax services; with limited exception, all tax services involving large and complex transactions must be specifically pre-approved by the Audit Committee.
ALL OTHER SERVICES
With respect to the provision of permissible services other than audit, review or attest services the pre-approval requirement is waived if:
(1) With respect to such services rendered to the Funds, the aggregate amount of all such services provided constitutes no more than five percent of the total amount of revenues paid by the audit client to its accountant during the fiscal year in which the services are provided; and,
(2) With respect to such services rendered to the Fund’s investment adviser ( the “Adviser”)and any entity controlling, controlled by to under common control with the Adviser such as affiliated non-U.S. and U.S. funds not under the Audit Committee’s purview and which do not fall within a category of service which has been determined by the Audit Committee not to have a direct impact on the operations or financial reporting of the RIC, the aggregate amount of all services provided constitutes no more than five percent of the total amount of revenues paid to the RIC’s auditor by the RIC, its Adviser and any entity controlling, controlled by, or under common control with the Adviser during the fiscal year in which the services are provided; and
(3) Such services were not recognized by the issuer or RIC at the time of the engagement to be non-audit services; and
(4) Such services are promptly brought to the attention of the Audit Committee and approved prior to the completion of the audit by the Audit Committee or by one or more members of the Audit Committee who are members of the Board of Directors to whom authority to grant such approvals has been delegated by the Audit Committee.
The Audit Committee may grant general pre-approval to those permissible non-audit services which qualify for pre-approval and which it believes are routine and recurring services, and would not impair the independence of the auditor.
The Securities and Exchange Commission’s (the “SEC”) rules and relevant guidance should be consulted to determine the precise definitions of these services and applicability of exceptions to certain of the prohibitions.
PRE-APPROVAL FEE LEVELS
Pre-approval fee levels for all services to be provided by the independent auditor will be established annually by the Audit Committee. Any proposed services exceeding these levels will require specific pre-approval by the Audit Committee.
PROCEDURES
Requests or applications to provide services that require specific approval by the Audit Committee will be submitted to the Audit Committee by the Fund’s Principal Accounting Officer and/or the Chief Audit Executive of Federated Hermes, Inc., only after those individuals have determined that the request or application is consistent with the SEC’s rules on auditor independence.
(e)(2) Percentage of services identified in items 4(b) through 4(d) that were approved by the registrant’s Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X:
4(b)
Fiscal year ended 2023 – 0%
Fiscal year ended 2022 - 0%
Percentage of services provided to the registrant’s Adviser and any entity controlling, controlled by, or under common control with the Adviser that provides ongoing services to the registrant that were approved by the registrant’s Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X, 0% and 0% respectively.
4(c)
Fiscal year ended 2023 – 0%
Fiscal year ended 2022 – 0%
Percentage of services provided to the registrant’s Adviser and any entity controlling, controlled by, or under common control with the Adviser that provides ongoing services to the registrant that were approved by the registrant’s Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X, 0% and 0% respectively.
4(d)
Fiscal year ended 2023 – 0%
Fiscal year ended 2022 – 0%
Percentage of services provided to the registrant’s Adviser and any entity controlling, controlled by, or under common control with the Adviser that provides ongoing services to the registrant that were approved by the registrant’s Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X, 0% and 0% respectively.
(f) NA
(g) Non-Audit Fees billed to the registrant, the registrant’s Adviser, and certain entities controlling, controlled by or under common control with the Adviser:
Fiscal year ended 2023 - $273,348
Fiscal year ended 2022 - $233,566
(h) The registrant’s Audit Committee has considered that the provision of non-audit services that were rendered to the registrant’s Adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the Adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.
Item 5. | Audit Committee of Listed Registrants |
Not Applicable
Item 6. | Schedule of Investments |
(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this form.
(b) Not Applicable; Fund had no divestments during the reporting period covered since the previous Form N-CSR filing.
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies |
Not Applicable
Item 8. | Portfolio Managers of Closed-End Management Investment Companies |
Not Applicable
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers |
Not Applicable
Item 10. | Submission of Matters to a Vote of Security Holders |
No Changes to Report
Item 11. | Controls and Procedures |
(a) The registrant’s President and Treasurer have concluded that the
registrant’s disclosure controls and procedures (as defined in rule 30a-3(c) under the Act) are effective in design and operation and are sufficient to form the basis of the certifications required by Rule 30a-(2) under the Act, based on their evaluation of these disclosure controls and procedures within 90 days of the filing date of this report on Form N-CSR.
(b) There were no changes in the registrant’s internal control over financial reporting (as defined in rule 30a-3(d) under the Act) during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. | Disclosure of Securities Lending Activities for Closed-End Management Investment Companies |
Not Applicable
Item 13. | Exhibits |
(a)(1) Code of Ethics- Not Applicable to this Report.
(a)(2) Certifications of Principal Executive Officer and Principal Financial Officer.
(a)(3) Not Applicable.
(b) Certifications pursuant to 18 U.S.C. Section 1350.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant Federated Hermes Equity Funds
By /S/ Lori A. Hensler
Lori A. Hensler, Principal Financial Officer
Date November 22, 2023
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By /S/ J. Christopher Donahue
J. Christopher Donahue, Principal Executive Officer
Date November 22, 2023
By /S/ Lori A. Hensler
Lori A. Hensler, Principal Financial Officer
Date November 22, 2023