United States
Securities and Exchange Commission
Washington, D.C. 20549
Form N-CSR
Certified Shareholder Report of Registered Management Investment Companies
811-6061
(Investment Company Act File Number)
Federated Index Trust
______________________________________________________________
(Exact Name of Registrant as Specified in Charter)
Federated Investors Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
John W. McGonigle, Esquire
Federated Investors Tower
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: 10/31/2012
Date of Reporting Period: Six months ended 04/30/2012
Item 1. Reports to Stockholders
Semi-Annual Shareholder Report | ||
April 30, 2012 | ||
Share Class | Ticker |
Institutional | FMCRX |
Service* | FMDCX |
*formerly, Institutional Service Shares
Federated Mid-Cap Index Fund
A Portfolio of Federated Index Trust
CONTENTS
Portfolio of Investments Summary Table (unaudited)
At April 30, 2012, the Fund's sector composition1 for its equity security investments was as follows:
Sector | Percentage of Total Net Assets |
Financials | 20.6% |
Industrials | 16.7% |
Information Technology | 16.5% |
Consumer Discretionary | 12.9% |
Health Care | 10.1% |
Materials | 6.4% |
Energy | 5.7% |
Utilities | 4.7% |
Consumer Staples | 4.1% |
Telecommunication Services | 0.5% |
Securities Lending Collateral2 | 3.7% |
Cash Equivalents3 | 1.9% |
Derivative Contracts4 | 0.1% |
Other Assets and Liabilities — Net5 | (3.9)% |
TOTAL6 | 100.0% |
1 | Except for Securities Lending Collateral, Cash Equivalents, Derivative Contracts 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 Manager assigns a classification to securities not classified by the GICS and to securities for which the Manager does not have access to the classification made by the GICS. |
2 | Cash collateral received from lending portfolio securities which is invested in short-term investments such as repurchase agreements or money market mutual funds. |
3 | Cash Equivalents include any investments in money market mutual funds and/or overnight repurchase agreements (other than those representing Securities Lending Collateral). |
4 | Based upon net unrealized appreciation (depreciation) or value of the derivative contracts as, applicable. Derivative contracts may consist of futures, forwards, options and swaps. The impact of a derivative contract on the Fund's performance may be larger than its unrealized appreciation (depreciation) may indicate. In many cases, the notional value or amount of a derivative contract may provide a better indication of the contract's significance to the portfolio. More complete information regarding the Fund's direct investments in derivative contracts, including unrealized appreciation (depreciation) 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. |
5 | Assets, other than investments in securities and derivative contracts, less liabilities. See Statement of Assets and Liabilities. |
6 | The Fund purchases index futures contracts to efficiently manage cash flows resulting from shareholder purchases and redemptions, dividend and capital gain payments to shareholders and corporate actions while maintaining exposure to the Standard & Poor's MidCap 400 Index (S&P 400) and minimizing trading costs. Taking into consideration these open index futures contracts, the Fund's effective total exposure to the S&P 400 is effectively 99.9%. |
April 30, 2012 (unaudited)
Shares | Value |
COMMON STOCKS – 98.2%1 |
Consumer Discretionary – 12.9% |
49,073 | 2 | AMC Networks, Inc. | 2,085,602 |
64,847 | Aaron's, Inc. | 1,761,893 |
62,223 | Advance Auto Parts, Inc. | 5,712,071 |
68,934 | 2 | Aeropostale, Inc. | 1,528,956 |
165,381 | American Eagle Outfitters, Inc. | 2,978,512 |
41,246 | 2 | Ann, Inc. | 1,142,102 |
115,064 | 2 | Ascena Retail Group, Inc. | 2,356,511 |
36,618 | 2 | Bally Technologies, Inc. | 1,777,804 |
35,105 | 2,3 | Barnes & Noble, Inc. | 728,429 |
25,083 | Bob Evans Farms, Inc. | 959,174 |
67,020 | Brinker International, Inc. | 2,109,119 |
43,699 | 2 | Carter's, Inc. | 2,372,856 |
46,603 | 2 | Cheesecake Factory, Inc. | 1,467,994 |
143,139 | Chicos Fas, Inc. | 2,198,615 |
86,756 | Cinemark Holdings, Inc. | 1,991,918 |
51,615 | 2 | Collective Brands, Inc. | 1,072,044 |
33,028 | 2,3 | Deckers Outdoor Corp. | 1,684,758 |
82,435 | Dick's Sporting Goods, Inc. | 4,171,211 |
60,905 | 2,3 | Dreamworks Animation SKG, Inc. | 1,096,899 |
129,059 | Foot Locker, Inc. | 3,947,915 |
122,918 | Gentex Corp. | 2,700,508 |
57,022 | Guess ?, Inc. | 1,669,604 |
33,592 | HSN, Inc. | 1,300,010 |
83,217 | 2 | Hanesbrands, Inc. | 2,348,384 |
16,751 | 2 | ITT Educational Services, Inc. | 1,105,901 |
24,093 | International Speedway Corp., Class A | 643,042 |
61,939 | KB HOME | 537,631 |
125,644 | 2 | LKQ Corp. | 4,202,792 |
49,992 | 2 | Lamar Advertising Co. | 1,590,745 |
36,254 | 2 | Life Time Fitness, Inc. | 1,687,986 |
32,294 | M.D.C. Holdings, Inc. | 907,784 |
24,239 | Matthews International Corp., Class A | 727,170 |
31,861 | Meredith Corp. | 918,553 |
48,718 | 2 | Mohawk Industries, Inc. | 3,265,080 |
4,316 | 2 | NVR, Inc. | 3,383,485 |
Shares | Value |
103,072 | 2 | New York Times Co., Class A | 650,384 |
239,867 | 2 | Office Depot, Inc. | 729,196 |
57,663 | PVH Corp. | 5,120,474 |
25,357 | 2 | Panera Bread Co. | 4,004,377 |
95,279 | PetSmart, Inc. | 5,550,955 |
58,420 | Polaris Industries, Inc., Class A | 4,640,885 |
85,117 | 3 | RadioShack Corp. | 440,906 |
48,339 | Regis Corp. | 887,021 |
50,577 | Rent-A-Center, Inc. | 1,730,239 |
133,013 | 2,3 | Saks, Inc. | 1,457,822 |
21,525 | Scholastic Corp. | 657,589 |
49,794 | 2 | Scientific Games Holdings Corp. | 505,907 |
189,046 | Service Corp. International | 2,189,153 |
74,181 | Signet Jewelers Ltd. | 3,617,807 |
57,666 | Sothebys Holdings, Inc., Class A | 2,267,427 |
9,739 | Strayer Education, Inc. | 961,045 |
252,462 | The Wendy's Co. | 1,229,490 |
37,449 | Thor Industries, Inc. | 1,266,900 |
125,131 | 2 | Toll Brothers, Inc. | 3,178,327 |
60,848 | Tractor Supply Co. | 5,988,052 |
47,902 | Tupperware Brands Corp. | 2,983,816 |
31,341 | 2,3 | Under Armour, Inc., Class A | 3,069,224 |
36,447 | 2,3 | Valassis Communications, Inc. | 728,940 |
47,566 | 2 | WMS Industries, Inc. | 1,165,843 |
34,555 | 2 | Warnaco Group, Inc. | 1,830,033 |
40,178 | Wiley (John) & Sons, Inc., Class A | 1,815,644 |
87,788 | Williams-Sonoma, Inc. | 3,396,518 |
TOTAL | 132,197,032 |
Consumer Staples – 4.1% |
121,520 | Church and Dwight, Inc. | 6,173,216 |
65,010 | Corn Products International, Inc. | 3,709,471 |
56,278 | 2 | Energizer Holdings, Inc. | 4,014,310 |
96,333 | Flowers Foods, Inc. | 2,066,343 |
110,989 | 2,3 | Green Mountain Coffee, Inc. | 5,410,714 |
42,067 | Harris Teeter Supermarkets, Inc. | 1,597,284 |
16,985 | Lancaster Colony Corp. | 1,107,592 |
129,413 | 2 | Monster Beverage Co. | 8,406,668 |
23,530 | Post Holdings, Inc. | 700,017 |
Shares | Value |
47,130 | 2 | Ralcorp Holdings, Inc. | 3,431,535 |
179,463 | SUPERVALU, Inc. | 1,066,010 |
137,358 | 2 | Smithfield Foods, Inc. | 2,879,024 |
21,948 | 3 | Tootsie Roll Industries, Inc. | 522,582 |
19,821 | Universal Corp. | 908,396 |
TOTAL | 41,993,162 |
Energy – 5.7% |
181,936 | Arch Coal, Inc. | 1,775,695 |
48,372 | 2 | Atwood Oceanics, Inc. | 2,144,331 |
39,976 | 2 | Bill Barrett Corp. | 958,624 |
16,963 | 3 | Carbo Ceramics, Inc. | 1,426,419 |
73,186 | Cimarex Energy Co. | 5,057,884 |
64,467 | 2 | Dresser-Rand Group, Inc. | 3,138,253 |
29,520 | 2 | Dril-Quip, Inc. | 1,989,353 |
61,538 | Energen Corp. | 3,223,360 |
95,477 | 2 | Forest Oil Corp. | 1,271,754 |
90,036 | 2 | Helix Energy Solutions Group, Inc. | 1,837,635 |
177,723 | HollyFrontier Corp. | 5,477,423 |
54,146 | 2,3 | Northern Oil and Gas, Inc. | 1,052,057 |
92,215 | Oceaneering International, Inc. | 4,761,060 |
43,803 | 2 | Oil States International, Inc. | 3,485,843 |
79,145 | 2,3 | Patriot Coal Corp. | 461,415 |
132,008 | Patterson-UTI Energy, Inc. | 2,134,569 |
109,426 | 2 | Plains Exploration & Production Co. | 4,470,052 |
102,171 | 2,3 | Quicksilver Resources, Inc. | 480,204 |
54,702 | SM Energy Co. | 3,616,349 |
134,454 | 2 | Superior Energy Services, Inc. | 3,619,502 |
43,760 | Tidewater, Inc. | 2,408,113 |
35,348 | 2 | Unit Corp. | 1,493,453 |
60,727 | World Fuel Services Corp. | 2,675,632 |
TOTAL | 58,958,980 |
Financials – 20.6% |
45,692 | 2 | Affiliated Managers Group | 5,191,525 |
52,951 | Alexandria Real Estate Equities, Inc. | 3,967,089 |
12,387 | 2 | Alleghany Corp. | 4,247,502 |
63,723 | American Campus Communities, Inc. | 2,832,487 |
65,164 | American Financial Group, Inc. | 2,536,183 |
168,210 | Apollo Investment Corp. | 1,219,523 |
Shares | Value |
60,268 | Aspen Insurance Holdings Ltd. | 1,706,790 |
148,473 | Associated Banc-Corp. | 1,979,145 |
71,268 | Astoria Financial Corp. | 690,587 |
64,614 | BRE Properties, Inc., Class A | 3,392,235 |
70,040 | Bancorpsouth, Inc. | 943,439 |
39,175 | Bank of Hawaii Corp. | 1,915,266 |
95,283 | Berkley, W. R. Corp. | 3,588,358 |
131,671 | BioMed Realty Trust, Inc. | 2,609,719 |
99,133 | Brown & Brown | 2,673,617 |
75,754 | CBOE Holdings, Inc. | 2,002,936 |
67,236 | Camden Property Trust | 4,549,860 |
67,132 | Cathay Bancorp, Inc. | 1,156,013 |
39,958 | City National Corp. | 2,128,163 |
67,558 | Commerce Bancshares, Inc. | 2,709,076 |
61,450 | Corporate Office Properties Trust | 1,447,148 |
52,278 | Cullen Frost Bankers, Inc. | 3,082,311 |
220,997 | Duke Realty Corp. | 3,275,176 |
127,230 | East West Bancorp, Inc. | 2,897,027 |
98,638 | Eaton Vance Corp. | 2,594,179 |
50,857 | Equity One, Inc. | 1,056,808 |
29,700 | Essex Property Trust, Inc. | 4,691,709 |
45,844 | Everest Re Group Ltd. | 4,543,140 |
54,327 | Federal Realty Investment Trust | 5,468,556 |
189,032 | Fidelity National Financial, Inc., Class A | 3,642,647 |
300,158 | First Niagara Financial Group, Inc. | 2,683,413 |
93,256 | FirstMerit Corp. | 1,566,701 |
170,735 | Fulton Financial Corp. | 1,791,010 |
98,147 | Gallagher (Arthur J.) & Co. | 3,686,401 |
24,659 | Greenhill & Co., Inc. | 958,002 |
88,839 | HCC Insurance Holdings, Inc. | 2,839,294 |
72,302 | Hancock Holding Co. | 2,326,678 |
38,426 | Hanover Insurance Group, Inc. | 1,550,873 |
61,841 | Highwoods Properties, Inc. | 2,147,738 |
41,284 | Home Properties, Inc. | 2,520,388 |
105,438 | Hospitality Properties Trust | 2,907,980 |
45,326 | International Bancshares Corp. | 894,282 |
160,669 | Janus Capital Group, Inc. | 1,217,871 |
128,254 | 3 | Jefferies Group, Inc. | 2,043,086 |
Shares | Value |
37,218 | Jones Lang LaSalle, Inc. | 2,975,207 |
42,838 | Kemper Corp. | 1,284,712 |
99,441 | Liberty Property Trust | 3,624,624 |
112,619 | Macerich Co. (The) | 6,933,952 |
74,894 | Mack-Cali Realty Corp. | 2,150,956 |
30,535 | Mercury General Corp. | 1,379,877 |
90,232 | National Retail Properties, Inc. | 2,470,552 |
374,283 | New York Community Bancorp, Inc. | 5,049,078 |
221,218 | Old Republic International Corp. | 2,201,119 |
88,620 | Omega Healthcare Investors | 1,897,354 |
34,307 | Potlatch Corp. | 1,073,809 |
40,287 | Prosperity Bancshares, Inc. | 1,879,389 |
69,707 | Protective Life Corp. | 2,039,627 |
95,130 | Raymond James Financial, Inc. | 3,483,661 |
104,464 | Rayonier, Inc. | 4,737,442 |
113,833 | Realty Income Corp. | 4,478,190 |
76,750 | Regency Centers Corp. | 3,450,680 |
62,626 | Reinsurance Group of America | 3,641,076 |
123,575 | SEI Investments Co. | 2,494,979 |
73,694 | SL Green Realty Corp. | 6,075,333 |
37,224 | 2 | SVB Financial Group | 2,385,686 |
138,831 | Senior Housing Properties Trust | 3,065,388 |
39,412 | 2 | Signature Bank | 2,588,974 |
37,841 | StanCorp Financial Group, Inc. | 1,452,338 |
673,961 | Synovus Financial Corp. | 1,415,318 |
134,589 | TCF Financial Corp. | 1,543,736 |
49,533 | Taubman Centers, Inc. | 3,822,957 |
54,735 | Trustmark Corp. | 1,393,006 |
190,558 | UDR, Inc. | 5,017,392 |
160,165 | Valley National Bancorp | 2,018,079 |
73,009 | Waddell & Reed Financial, Inc., Class A | 2,334,828 |
91,870 | Washington Federal, Inc. | 1,611,400 |
62,746 | Webster Financial Corp. Waterbury | 1,426,217 |
103,149 | Weingarten Realty Investors | 2,739,637 |
23,966 | WestAmerica Bancorp. | 1,099,320 |
TOTAL | 211,107,824 |
Health Care – 10.1% |
162,529 | 2 | Allscripts Healthcare Solutions, Inc. | 1,800,821 |
Shares | Value |
41,046 | 2 | Amerigroup Corp. | 2,535,001 |
16,852 | 2 | Bio-Rad Laboratories, Inc., Class A | 1,819,847 |
42,863 | 2 | Catalyst Health Solutions, Inc. | 3,702,077 |
41,720 | 2 | Charles River Laboratories International, Inc. | 1,482,312 |
75,409 | 2 | Community Health Systems, Inc. | 1,835,455 |
40,746 | Cooper Cos., Inc. | 3,592,575 |
49,930 | 2 | Covance, Inc. | 2,334,727 |
99,728 | 2 | Endo Pharmaceuticals Holdings, Inc. | 3,504,442 |
38,598 | 2 | Gen-Probe, Inc. | 3,147,667 |
73,349 | 2 | HMS Holdings Corp. | 1,764,777 |
216,910 | 2 | Health Management Association, Class A | 1,561,752 |
70,821 | 2 | Health Net, Inc. | 2,521,936 |
76,613 | 2 | Henry Schein, Inc. | 5,879,282 |
52,821 | Hill-Rom Holdings, Inc. | 1,714,041 |
225,059 | 2 | Hologic, Inc. | 4,303,128 |
46,982 | 2 | IDEXX Laboratories, Inc. | 4,131,127 |
41,242 | 2 | LifePoint Hospitals, Inc. | 1,609,263 |
74,255 | Lincare Holdings, Inc. | 1,811,822 |
41,889 | 2 | MEDNAX, Inc. | 2,942,283 |
49,715 | 2 | Masimo Corp. | 1,100,193 |
50,199 | Medicis Pharmaceutical Corp., Class A | 1,931,156 |
26,871 | 2 | Mettler-Toledo International, Inc. | 4,818,508 |
96,949 | Omnicare, Inc. | 3,377,703 |
54,144 | Owens & Minor, Inc. | 1,583,171 |
64,977 | 2 | Regeneron Pharmaceuticals, Inc. | 8,788,789 |
123,046 | 2 | ResMed, Inc. | 4,184,794 |
49,482 | Steris Corp. | 1,554,230 |
31,584 | Techne Corp. | 2,114,233 |
34,757 | Teleflex, Inc. | 2,178,221 |
49,864 | 2 | Thoratec Laboratories Corp. | 1,735,766 |
45,744 | 2 | United Therapeutics Corp. | 2,001,300 |
82,528 | Universal Health Services, Inc., Class B | 3,524,771 |
74,481 | 2 | VCA Antech, Inc. | 1,762,220 |
179,475 | 2 | Vertex Pharmaceuticals, Inc. | 6,906,198 |
36,530 | 2 | Wellcare Health Plans, Inc. | 2,234,905 |
TOTAL | 103,790,493 |
Industrials – 16.7% |
82,956 | 2 | AGCO Corp. | 3,863,261 |
Shares | Value |
136,942 | AMETEK, Inc. | 6,892,291 |
35,907 | Acuity Brands, Inc. | 1,995,352 |
99,910 | 2 | Aecom Technology Corp. | 2,205,014 |
60,632 | 2 | Alaska Air Group, Inc. | 2,049,362 |
35,713 | Alexander and Baldwin, Inc. | 1,827,077 |
28,126 | Alliant Techsystems, Inc. | 1,499,116 |
88,669 | 2 | BE Aerospace, Inc. | 4,170,103 |
39,978 | Brinks Co. (The) | 1,015,441 |
42,877 | CLARCOR, Inc. | 2,058,954 |
52,713 | Carlisle Cos., Inc. | 2,902,378 |
40,407 | 2 | Clean Harbors, Inc. | 2,757,374 |
47,605 | Con-way, Inc. | 1,547,162 |
91,070 | 2 | Copart, Inc. | 2,405,159 |
28,422 | Corporate Executive Board Co. | 1,175,818 |
84,941 | Corrections Corp. of America | 2,453,945 |
41,413 | Crane Co. | 1,827,556 |
43,374 | Deluxe Corp. | 1,032,735 |
127,214 | Donaldson Co., Inc. | 4,409,237 |
26,132 | 2 | Esterline Technologies Corp. | 1,789,781 |
157,563 | Exelis, Inc. | 1,816,701 |
35,478 | 2 | FTI Consulting, Inc. | 1,289,271 |
134,674 | 2 | Fortune Brands Home & Security, Inc. | 3,062,487 |
39,779 | GATX Corp. | 1,705,326 |
43,251 | Gardner Denver, Inc. | 2,817,370 |
42,468 | 2 | General Cable Corp. | 1,250,258 |
51,056 | Graco, Inc. | 2,721,795 |
29,643 | Granite Construction, Inc. | 825,261 |
38,267 | HNI Corp. | 923,000 |
68,900 | Harsco Corp. | 1,536,470 |
50,855 | Hubbell, Inc., Class B | 4,080,605 |
76,893 | Hunt (J.B.) Transportation Services, Inc. | 4,254,490 |
41,665 | 2 | Huntington Ingalls Industries, Inc. | 1,643,684 |
71,496 | IDEX Corp. | 3,096,492 |
80,944 | ITT Corp. | 1,818,002 |
175,330 | 2,3 | Jet Blue Airways Corp. | 832,817 |
126,325 | KBR, Inc. | 4,277,364 |
93,830 | Kansas City Southern Industries, Inc. | 7,226,787 |
68,039 | Kennametal, Inc. | 2,873,287 |
Shares | Value |
47,646 | 2 | Kirby Corp. | 3,162,265 |
40,651 | 2 | Korn/Ferry International | 656,514 |
40,039 | Landstar System, Inc. | 2,144,889 |
43,402 | Lennox International, Inc. | 1,883,647 |
71,531 | Lincoln Electric Holdings | 3,505,734 |
39,299 | MSC Industrial Direct Co. | 2,896,729 |
68,390 | Manpower, Inc. | 2,913,414 |
49,678 | Miller Herman, Inc. | 970,211 |
26,254 | Mine Safety Appliances Co. | 1,114,745 |
48,590 | Nordson Corp. | 2,619,001 |
78,040 | 2 | OshKosh Truck Corp. | 1,781,653 |
84,134 | 3 | Pentair, Inc. | 3,646,368 |
35,517 | Regal Beloit Corp. | 2,402,370 |
55,190 | Rollins, Inc. | 1,172,787 |
43,715 | SPX Corp. | 3,356,438 |
55,616 | 2 | Shaw Group, Inc. | 1,683,496 |
93,646 | 2 | Terex Corp. | 2,120,145 |
44,535 | 2 | Thomas & Betts Corp. | 3,202,512 |
71,683 | Timken Co. | 4,050,806 |
43,196 | Towers Watson & Company | 2,825,018 |
68,404 | Trinity Industries, Inc. | 2,024,758 |
36,862 | Triumph Group, Inc. | 2,315,671 |
67,960 | URS Corp. | 2,807,428 |
87,753 | UTI Worldwide, Inc. | 1,462,842 |
70,446 | 2,3 | United Rentals, Inc. | 3,288,419 |
19,186 | Valmont Industries, Inc. | 2,377,721 |
40,947 | Wabtec Corp. | 3,184,858 |
105,169 | Waste Connections, Inc. | 3,389,597 |
24,229 | Watsco, Inc. | 1,743,277 |
37,906 | Werner Enterprises, Inc. | 895,340 |
51,283 | Woodward Governor Co. | 2,132,860 |
TOTAL | 171,660,096 |
Information Technology – 16.5% |
33,432 | 2 | ACI Worldwide, Inc. | 1,332,600 |
80,884 | 2,3 | AOL, Inc. | 2,025,335 |
66,745 | 2 | Acxiom Corp. | 916,409 |
54,499 | Adtran, Inc. | 1,663,309 |
27,453 | 2 | Advent Software, Inc. | 740,956 |
Shares | Value |
42,699 | 2 | Alliance Data Systems Corp. | 5,486,395 |
79,164 | 2 | Ansys, Inc. | 5,309,529 |
95,493 | 2 | Arrow Electronics, Inc. | 4,015,481 |
384,826 | 2,3 | Atmel Corp. | 3,413,407 |
123,784 | 2 | Avnet, Inc. | 4,466,127 |
105,944 | Broadridge Financial Solutions | 2,458,960 |
84,123 | 2 | CIENA Corp. | 1,246,703 |
233,725 | 2 | Cadence Design Systems, Inc. | 2,727,571 |
186,414 | 2 | Compuware Corp. | 1,625,530 |
39,996 | 2 | Concur Technologies, Inc. | 2,262,174 |
98,876 | 2 | Convergys Corp. | 1,321,972 |
90,915 | 2 | CoreLogic, Inc. | 1,518,281 |
98,669 | 2,3 | Cree, Inc. | 3,048,872 |
132,194 | 2 | Cypress Semiconductor Corp. | 2,049,007 |
28,592 | DST Systems, Inc. | 1,600,580 |
53,470 | Diebold, Inc. | 2,109,392 |
39,817 | 2,3 | Equinix, Inc. | 6,537,951 |
38,552 | FactSet Research Systems | 4,042,563 |
30,727 | Fair Isaac & Co., Inc. | 1,318,188 |
107,922 | 2 | Fairchild Semiconductor International, Inc., Class A | 1,529,255 |
90,014 | First American Financial Corp. | 1,507,735 |
79,680 | 2 | Gartner Group, Inc., Class A | 3,489,984 |
66,849 | Global Payments, Inc. | 3,103,799 |
74,049 | Henry Jack & Associates, Inc. | 2,514,704 |
91,611 | 2 | Informatica Corp. | 4,215,938 |
128,090 | 2 | Ingram Micro, Inc., Class A | 2,492,631 |
120,957 | 2 | Integrated Device Technology, Inc. | 818,879 |
58,942 | 2 | International Rectifier Corp. | 1,286,704 |
107,921 | Intersil Holding Corp. | 1,108,349 |
33,988 | 2 | Itron, Inc. | 1,386,710 |
102,285 | 2,3 | Lam Research Corp. | 4,260,170 |
72,034 | Lender Processing Services | 1,912,503 |
196,443 | 2 | MEMC Electronic Materials, Inc. | 705,230 |
68,210 | 2 | MICROS Systems Corp. | 3,876,374 |
103,625 | 2 | MSCI, Inc., Class A | 3,791,639 |
19,735 | ManTech International Corp., Class A | 620,074 |
79,663 | 2 | Mentor Graphics Corp. | 1,151,130 |
105,046 | 2 | Monster Worldwide, Inc. | 906,547 |
Shares | Value |
135,045 | 2 | NCR Corp. | 3,173,558 |
79,318 | National Instruments Corp. | 2,157,450 |
57,492 | 2 | NeuStar, Inc., Class A | 2,089,834 |
101,123 | 2 | Parametric Technology Corp. | 2,182,234 |
36,678 | Plantronics, Inc. | 1,405,501 |
151,479 | 2 | Polycom, Inc. | 2,010,126 |
84,203 | 2 | Qlogic Corp. | 1,452,502 |
48,407 | 2 | Quest Software, Inc. | 1,126,431 |
237,283 | 2 | RF Micro Devices, Inc. | 1,027,435 |
88,948 | 2 | Rackspace Hosting, Inc. | 5,166,989 |
134,389 | 2 | Riverbed Technology, Inc. | 2,651,495 |
91,551 | 2 | Rovi Corp. | 2,618,359 |
55,548 | 2 | Semtech Corp. | 1,514,238 |
36,021 | 2 | Silicon Laboratories, Inc. | 1,278,385 |
160,757 | 2 | Skyworks Solutions, Inc. | 4,362,945 |
59,783 | Solera Holdings, Inc. | 2,686,648 |
124,389 | 2 | Synopsys, Inc. | 3,732,914 |
35,230 | 2 | Tech Data Corp. | 1,895,022 |
311,335 | Tellabs, Inc. | 1,173,733 |
142,169 | 2 | Tibco Software, Inc. | 4,677,360 |
106,150 | 2 | Trimble Navigation Ltd. | 5,746,961 |
68,559 | 2 | ValueClick, Inc. | 1,452,080 |
90,406 | 2 | Verifone Systems, Inc. | 4,306,942 |
134,179 | 2 | Vishay Intertechnology, Inc. | 1,505,488 |
33,021 | 2 | Wright Express Corp. | 2,107,400 |
44,357 | 2 | Zebra Technologies Corp., Class A | 1,720,608 |
TOTAL | 169,138,285 |
Materials – 6.4% |
75,884 | Albemarle Corp. | 4,955,225 |
56,396 | Aptargroup, Inc. | 3,074,146 |
66,810 | Ashland, Inc. | 4,400,775 |
53,810 | Cabot Corp. | 2,320,825 |
37,518 | Carpenter Technology Corp. | 2,088,252 |
98,630 | Commercial Metals Corp. | 1,457,751 |
28,168 | Compass Minerals International, Inc. | 2,155,415 |
39,045 | Cytec Industries, Inc. | 2,482,091 |
31,355 | Domtar, Corp. | 2,742,935 |
26,261 | Greif, Inc., Class A | 1,408,640 |
Shares | Value |
44,940 | 2 | Intrepid Potash, Inc. | 1,116,759 |
116,929 | 2 | Louisiana-Pacific Corp. | 1,058,207 |
39,006 | Martin Marietta Materials | 3,232,817 |
15,141 | Minerals Technologies, Inc. | 1,015,961 |
9,040 | Newmarket Corp. | 2,017,909 |
68,431 | Olin Corp. | 1,434,314 |
82,356 | Packaging Corp. of America | 2,403,972 |
112,050 | RPM International, Inc. | 2,977,169 |
63,995 | Reliance Steel & Aluminum Co. | 3,576,681 |
60,259 | Rock-Tenn Co. | 3,755,943 |
36,944 | Scotts Miracle-Gro Co. | 1,935,866 |
42,891 | Sensient Technologies Corp. | 1,593,401 |
42,306 | Silgan Holdings, Inc. | 1,855,964 |
85,775 | Sonoco Products Co. | 2,841,726 |
187,013 | Steel Dynamics, Inc. | 2,388,156 |
79,776 | Valspar Corp. | 4,080,542 |
44,711 | Worthington Industries, Inc. | 797,644 |
TOTAL | 65,169,086 |
Telecommunication Services – 0.5% |
127,970 | 2 | TW Telecom, Inc. | 2,787,187 |
82,376 | Telephone and Data System, Inc. | 2,000,913 |
TOTAL | 4,788,100 |
Utilities – 4.7% |
94,731 | Alliant Energy Corp. | 4,285,630 |
118,507 | Aqua America, Inc. | 2,691,294 |
77,134 | Atmos Energy Corp. | 2,513,026 |
37,460 | Black Hills Corp. | 1,236,555 |
51,915 | Cleco Corp. | 2,118,132 |
116,149 | Great Plains Energy, Inc. | 2,371,762 |
81,924 | Hawaiian Electric Industries, Inc. | 2,174,263 |
42,606 | Idacorp, Inc. | 1,735,768 |
161,150 | MDU Resources Group, Inc. | 3,696,781 |
201,444 | NV Energy, Inc. | 3,354,043 |
70,874 | National Fuel Gas Co. | 3,353,758 |
83,698 | OGE Energy Corp. | 4,516,344 |
67,997 | PNM Resources, Inc. | 1,275,624 |
151,839 | Questar Corp. | 2,998,820 |
95,687 | UGI Corp. | 2,792,147 |
Shares | Value |
69,869 | Vectren Corp. | 2,057,642 |
43,900 | WGL Holdings, Inc. | 1,760,829 |
107,774 | Westar Energy, Inc. | 3,092,036 |
TOTAL | 48,024,454 |
TOTAL COMMON STOCKS (IDENTIFIED COST $795,111,836) | 1,006,827,512 |
MUTUAL FUND – 5.6% |
57,479,209 | 4,5,6 | Federated Prime Value Obligations Fund, Institutional Shares, 0.20% (AT NET ASSET VALUE) | 57,479,209 |
TOTAL INVESTMENTS — 103.8% (IDENTIFIED COST $852,591,045)7 | 1,064,306,721 |
OTHER ASSETS AND LIABILITIES - NET — (3.8)%8 | (39,498,579) |
TOTAL NET ASSETS — 100% | $1,024,808,142 |
At April 30, 2012, the Fund had the following outstanding futures contracts:1
Description | Number of Contracts | Notional Value | Expiration Date | Unrealized Appreciation |
2 S&P Midcap 400 Index Long Futures | 186 | $18,406,560 | June 2012 | $531,376 |
Unrealized Appreciation on Futures Contracts is Included in “Other Assets and
Liabilities — Net.”
1 | The Fund purchases index futures contracts to efficiently manage cash flows resulting from shareholder purchases and redemptions, dividend and capital gain payments to shareholders and corporate actions while maintaining exposure to the S&P MidCap 400 Index and minimizing trading costs. The underlying face amount, at value, of open index futures contracts is $18,406,560 at April 30, 2012, which represents 1.8% of total net assets. Taking into consideration these open index futures contracts, the Fund's effective total exposure to the S&P MidCap 400 Index is 99.9%. |
2 | Non-income producing security. |
3 | All or a portion of these securities are temporarily on loan to unaffiliated broker/dealers. |
4 | Affiliated holding. |
5 | 7-Day net yield. |
6 | All or a portion of this security is held as collateral for securities lending. |
7 | The cost of investments for federal tax purposes amounts to $852,975,822. |
8 | Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. |
Note: The categories of investments are shown as a percentage of total net assets at April 30, 2012.
Semi-Annual Shareholder Report
Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in the three broad levels listed below:Level 1 — quoted prices in active markets for identical securities, including investment companies with daily net asset values, if applicable.
Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). Also includes securities valued at amortized cost.
Level 3 — significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
As of April 30, 2012, all investments of the Fund utilized Level 1 inputs in valuing the Fund's assets carried at fair value.
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportFinancial Highlights – Institutional Shares
(For a Share Outstanding Throughout the Period)
Period Ended (unaudited) 4/30/20121 |
Net Asset Value, Beginning of Period | $20.25 |
Income From Investment Operations: |
Net investment income | 0.03 |
Net realized and unrealized gain on investments and futures contracts | 2.40 |
TOTAL FROM INVESTMENT OPERATIONS | 2.43 |
Less Distributions: |
Distributions from net investment income | (0.06) |
Net Asset Value, End of Period | $22.62 |
Total Return2 | 11.99% |
Ratios to Average Net Assets: |
Net expenses | 0.29%3 |
Net investment income | 0.56%3 |
Expense waiver/reimbursement4 | 0.20%3 |
Supplemental Data: |
Net assets, end of period (000 omitted) | $1,061 |
Portfolio turnover | 2%5 |
1 | Reflects operations for the period from January 4, 2012 (date of initial investment) to April 30, 2012. |
2 | Based on net asset value. Total return for the period of less than one year is not annualized. |
3 | Computed on an annualized basis. |
4 | This expense decrease is reflected in both the net expense and the net investment income ratio shown above. |
5 | Portfolio turnover is calculated at Fund level. Percentage indicated was calculated for the period from November 1, 2011 to April 30, 2012. |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportFinancial Highlights – Service Shares
(For a Share Outstanding Throughout Each Period)
Six Months Ended (unaudited) 4/30/2012 | Year Ended October 31, | ||||
2011 | 2010 | 2009 | 2008 | 2007 | |
Net Asset Value, Beginning of Period | $21.19 | $20.17 | $16.01 | $14.06 | $25.79 | $23.49 |
Income From Investment Operations: | |||||
Net investment income | 0.08 | 0.15 | 0.16 | 0.17 | 0.24 | 0.34 |
Net realized and unrealized gain (loss) on investments and futures contracts | 2.39 | 1.45 | 4.16 | 2.21 | (8.69) | 3.37 |
TOTAL FROM INVESTMENT OPERATIONS | 2.47 | 1.60 | 4.32 | 2.38 | (8.45) | 3.71 |
Less Distributions: | |||||
Distributions from net investment income | (0.09) | (0.15) | (0.16) | (0.20) | (0.22) | (0.35) |
Distributions from net realized gain on investments and futures contracts | (0.94) | (0.43) | — | (0.23) | (3.06) | (1.06) |
TOTAL DISTRIBUTIONS | (1.03) | (0.58) | (0.16) | (0.43) | (3.28) | (1.41) |
Net Asset Value, End of Period | $22.63 | $21.19 | $20.17 | $16.01 | $14.06 | $25.79 |
Total Return1 | 12.22% | 7.95% | 27.07%2 | 17.80% | (36.58)% | 16.59% |
Ratios to Average Net Assets: | |||||
Net expenses | 0.54%3 | 0.54% | 0.54% | 0.54%4 | 0.49% | 0.49% |
Net investment income | 0.79%3 | 0.69% | 0.88% | 1.27% | 1.13% | 1.41% |
Expense waiver/reimbursement5 | 0.19%3 | 0.19% | 0.19% | 0.21% | 0.21% | 0.19% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $1,023,747 | $926,540 | $883,235 | $731,613 | $604,507 | $1,257,048 |
Portfolio turnover | 2% | 8% | 12% | 18% | 19% | 17% |
1 | Based on net asset value. Total returns for periods of less than one year are not annualized. |
2 | During the year, the Fund received a regulatory settlement from an unaffiliated third party, which had an impact of 0.06% on the total return. |
3 | Computed on an annualized basis. |
4 | The net expense ratio is calculated without reduction for expense offset arrangements. The net expense ratio is 0.54% for the year ended October 31, 2009, after taking into account this expense reduction. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportStatement of Assets and Liabilities
Assets: |
Total investment in securities, at value including $36,992,702 of securities loaned and $57,479,209 of investments in an affiliated holding (Note 5) (identified cost $852,591,045) | $1,064,306,721 |
Restricted cash (Note 2) | 1,236,000 |
Income receivable | 418,414 |
Receivable for investments sold | 564,512 |
Receivable for shares sold | 765,667 |
TOTAL ASSETS | 1,067,291,314 |
Liabilities: |
Payable for investments purchased | $1,848,176 |
Payable for shares redeemed | 1,682,081 |
Payable for daily variation margin | 161,547 |
Payable for collateral due to broker for securities lending | 38,507,202 |
Payable for Directors'/Trustees' fees | 1,330 |
Payable for shareholder services fee (Note 5) | 200,663 |
Accrued expenses | 82,173 |
TOTAL LIABILITIES | 42,483,172 |
Net assets for 45,288,198 shares outstanding | $1,024,808,142 |
Net Assets Consist of: |
Paid-in capital | $802,281,324 |
Net unrealized appreciation of investments and futures contracts | 212,247,052 |
Accumulated net realized gain on investments and futures contracts | 10,436,729 |
Distributions in excess of net investment income | (156,963) |
TOTAL NET ASSETS | $1,024,808,142 |
Net Asset Value, Offering Price and Redemption Proceeds Per Share |
Institutional Shares: |
$1,061,291 ÷ 46,922 shares outstanding, no par value, unlimited shares authorized | $22.62 |
Service Shares: |
$1,023,746,851 ÷ 45,241,276 shares outstanding, no par value, unlimited shares authorized | $22.63 |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportSix Months Ended April 30, 2012 (unaudited)
Investment Income: |
Dividends (including $14,178 received from an affiliated holding (Note 5)) | $6,349,150 |
Interest (including income on securities loaned of $72,341) | 72,455 |
TOTAL INCOME | 6,421,605 |
Expenses: |
Management fee (Note 5) | $1,921,877 |
Custodian fees | 40,055 |
Transfer and dividend disbursing agent fees and expenses | 241,382 |
Directors'/Trustees' fees | 6,039 |
Auditing fees | 11,635 |
Legal fees | 4,038 |
Portfolio accounting fees | 64,092 |
Shareholder services fee (Note 5) | 1,176,964 |
Account administration fee (Note 2) | 12,318 |
Share registration costs | 20,217 |
Printing and postage | 19,627 |
Insurance premiums | 2,701 |
Miscellaneous | 16,860 |
TOTAL EXPENSES | 3,537,805 |
Waiver/reimbursement of management fee (Note 5) | $(924,803) |
Net expenses | 2,613,002 |
Net investment income | 3,808,603 |
Realized and Unrealized Gain (Loss) on Investments and Futures Contracts: |
Net realized gain on investments | 21,659,714 |
Net realized gain on futures contracts | 2,168,693 |
Net change in unrealized appreciation of investments | 84,496,428 |
Net change in unrealized appreciation of futures contracts | (198,077) |
Net realized and unrealized gain on investments and futures contracts | 108,126,758 |
Change in net assets resulting from operations | $111,935,361 |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportStatement of Changes in Net Assets
Six Months Ended (unaudited) 4/30/2012 | Year Ended 10/31/2011 |
Increase (Decrease) in Net Assets |
Operations: |
Net investment income | $3,808,603 | $6,739,604 |
Net realized gain on investments and futures contracts | 23,828,407 | 41,586,502 |
Net change in unrealized appreciation/depreciation of investments and futures contracts | 84,298,351 | 22,782,172 |
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | 111,935,361 | 71,108,278 |
Distributions to Shareholders: |
Distributions from net investment income |
Institutional Shares | (2,262) | — |
Service Shares | (4,402,425) | (6,903,421) |
Distributions from net realized gain on investments |
Service Shares | (40,564,917) | (18,885,065) |
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS | (44,969,604) | (25,788,486) |
Share Transactions: |
Proceeds from sale of shares | 97,335,982 | 228,272,023 |
Net asset value of shares issued to shareholders in payment of distributions declared | 41,794,274 | 23,840,324 |
Cost of shares redeemed | (107,827,650) | (254,127,446) |
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS | 31,302,606 | (2,015,099) |
Regulatory Settlement Proceeds |
Change in net assets | 98,268,363 | 43,304,693 |
Net Assets: |
Beginning of period | 926,539,779 | 883,235,086 |
End of period (including undistributed (distributions in excess of) net investment income of $(156,963) and $439,121, respectively) | $1,024,808,142 | $926,539,779 |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder Report1. ORGANIZATION
Federated Index Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “Act”), as an open-end management investment company. The Trust consists of two portfolios. The financial statements included herein are only those of Federated Mid-Cap Index Fund (the “Fund”), a diversified portfolio. The financial statements of the other portfolios are presented separately. The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. Each portfolio pays its own expenses. The Fund offers two classes of shares: Institutional Shares and Service Shares. The investment objective of the Fund is to provide investment results generally corresponding to the aggregate price and dividend performance of the publicly traded common stocks that comprise the mid-level stock capitalization sector of the U.S. equity market. This group of stocks is known as the S&P MidCap 400 Index.
Effective January 4, 2012, the Fund began offering Institutional Shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with U.S. generally accepted accounting principles (GAAP).
Investment Valuation
In calculating its net asset value (NAV), the Fund generally values investments as follows:
- Equity securities listed on an exchange or traded through a regulated market system are valued at their last reported sale price or official closing price in their principal exchange or market.
- Derivative contracts listed on exchanges are valued at their reported settlement or closing price.
- Over-the-counter (OTC) derivative contracts are fair valued using price evaluations provided by a pricing service approved by the Board of Trustees (the “Trustees”).
- Shares of other mutual funds are valued based upon their reported NAVs.
- Fixed-income securities acquired with remaining maturities greater than 60 days are fair valued using price evaluations provided by a pricing service approved by the Trustees.
- Fixed-income securities acquired with remaining maturities of 60 days or less are valued at their cost (adjusted for the accretion of any discount or amortization of any premium), which approximates market value.
- For securities that are fair valued in accordance with procedures established by and under the general supervision of the Trustees, certain factors may be considered such as: the purchase price of the security, information obtained by contacting the issuer, analysis of the issuer's financial statements or other available documents, fundamental analytical data, the nature and duration of restrictions on disposition, the movement of the market in which the security is normally traded and public trading in similar securities of the issuer or comparable issuers.
Semi-Annual Shareholder Report
If the Fund cannot obtain a price or price evaluation from a pricing service for an investment, the Fund may attempt to value the investment based upon the mean of bid and asked quotations or fair value the investment based on price evaluations, from one or more dealers. If any price, quotation, price evaluation or other pricing source is not readily available when the NAV is calculated, the Fund uses the fair value of the investment determined in accordance with the procedures described below. There can be no assurance that the Fund could purchase or sell an investment at the price used to calculate the Fund's NAV.Fair Valuation and Significant Events Procedures
The Trustees have authorized the use of pricing services to provide evaluations of the current fair value of certain investments for purposes of calculating the NAV. Factors considered by pricing services in evaluating an investment include the yields or prices of investments of comparable quality, coupon, maturity, call rights and other potential prepayments, terms and type, reported transactions, indications as to values from dealers and general market conditions. Some pricing services provide a single price evaluation reflecting the bid-side of the market for an investment (a “bid” evaluation). Other pricing services offer both bid evaluations and price evaluations indicative of a price between the prices bid and asked for the investment (a “mid” evaluation). The Fund normally uses bid evaluations for U.S. Treasury and Agency securities and mortgage-backed securities. The Fund normally uses mid evaluations for other types of fixed-income securities and OTC derivative contracts. In the event that market quotations and price evaluations are not available for an investment, the fair value of the investment is determined in accordance with procedures adopted by the Trustees.
The Trustees also have adopted procedures requiring an investment to be priced at its fair value whenever the Manager determines that a significant event affecting the value of the investment has occurred between the time as of which the price of the investment would otherwise be determined and the time as of which the NAV is computed. An event is considered significant if there is both an affirmative expectation that the investment's value will change in response to the event and a reasonable basis for quantifying the resulting change in value. Examples of significant events that may occur after the close of the principal market on which a security is traded, or after the time of a price evaluation provided by a pricing service or a dealer, include:
- With respect to securities traded in foreign markets, significant trends in U.S. equity markets or in the trading of foreign securities index futures or options contracts;
- With respect to price evaluations of fixed-income securities determined before the close of regular trading on the NYSE, actions by the Federal Reserve Open Market Committee and other significant trends in U.S. fixed-income markets;
- Political or other developments affecting the economy or markets in which an issuer conducts its operations or its securities are traded; and
- Announcements concerning matters such as acquisitions, recapitalizations, litigation developments, a natural disaster affecting the issuer's operations or regulatory changes or market developments affecting the issuer's industry.
The Trustees have approved the use of a pricing service to determine the fair value of equity securities traded principally in foreign markets when the Manager determines that there has been a significant trend in the U.S. equity markets or in index futures trading. For other significant events, the Fund may seek to obtain more current quotations or price evaluations from alternative pricing sources. If a reliable alternative pricing source is not available, the Fund will determine the fair value of the investment using another method approved by the Trustees.
Semi-Annual Shareholder Report
Repurchase AgreementsThe Fund may invest in repurchase agreements for short-term liquidity purposes. It is the policy of the Fund to require the other party to a repurchase agreement to transfer to the Fund's custodian or sub-custodian eligible securities or cash with a market value (after transaction costs) at least equal to the repurchase price to be paid under the repurchase agreement. The eligible securities are transferred to accounts with the custodian or sub-custodian in which the Fund holds a “securities entitlement” and exercises “control” as those terms are defined in the Uniform Commercial Code. The Fund has established procedures for monitoring the market value of the transferred securities and requiring the transfer of additional eligible securities if necessary to equal at least the repurchase price. These procedures also allow the other party to require securities to be transferred from the account to the extent that their market value exceeds the repurchase price or in exchange for other eligible securities of equivalent market value.
The insolvency of the other party or other failure to repurchase the securities may delay the disposition of the underlying securities or cause the Fund to receive less than the full repurchase price. Under the terms of the repurchase agreement, any amounts received by the Fund in excess of the repurchase price and related transaction costs must be remitted to the other party.
The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub-custodian for investment companies and other clients advised by the Fund's Manager and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities.
Investment Income, Gains and Losses, Expenses and Distributions
Investment transactions are accounted for on a trade-date basis. Realized gains and losses from investment transactions are recorded on an identified-cost basis. Interest income and expenses are accrued daily. Dividend income and distributions to shareholders are recorded on the ex-dividend date. Foreign dividends are recorded on the ex-dividend date or when the Fund is informed of the ex-dividend date. Distributions of net investment income are declared and paid quarterly. Non-cash dividends included in dividend income, if any, are recorded at fair value. Investment income, realized and unrealized gains and losses, and certain fund-level expenses are allocated to each class based on relative average daily net assets, except that Institutional Shares and Service Shares may bear shareholder services fees and account administration fees unique to those classes. For the six months ended April 30, 2012, account administration fees for the Fund were as follows:
Account Administration Fees Incurred |
Service Shares | $12,318 |
Dividends are declared separately for each class. No class has preferential dividend rights; differences in per share dividend rates are generally due to differences in separate class expenses.
Semi-Annual Shareholder Report
Premium and Discount AmortizationAll premiums and discounts on fixed-income securities are amortized/accreted using the effective interest rate method.
Federal Taxes
It is the Fund's policy to comply with the Subchapter M provision of the Internal Revenue Code and to distribute to shareholders each year substantially all of its income. Accordingly, no provision for federal income tax is necessary. As of and during the six months ended April 30, 2012, the Fund did not have a liability for any uncertain tax positions. The Fund recognizes interest and penalties, if any, related to tax liabilities as income tax expense in the Statement of Operations. As of April 30, 2012, tax years 2008 through 2011 remain subject to examination by the Fund's major tax jurisdictions, which include the United States of America and the Commonwealth of Massachusetts.
When-Issued and Delayed Delivery Transactions
The Fund may engage in when-issued or delayed delivery transactions. The Fund records when-issued securities on the trade date and maintains security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked to market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.
Futures Contracts
The Fund purchases stock index futures contracts to manage cash flows, maintain exposure to the S&P MidCap 400 Index and to potentially reduce transaction costs. Upon entering into a stock index futures contract with a broker, the Fund is required to deposit in a segregated account a specified amount of cash or U.S. government securities which is shown as Restricted Cash in the Statement of Assets and Liabilities. Futures contracts are valued daily and unrealized gains or losses are recorded in a “variation margin” account. Daily, the Fund receives from or pays to the broker a specified amount of cash based upon changes in the variation margin account. When a contract is closed, the Fund recognizes a realized gain or loss. Futures contracts have market risks, including the risk that the change in the value of the contract may not correlate with the changes in the value of the underlying securities. There is minimal counterparty risk to the Fund since futures are exchange traded and the exchange's clearinghouse, as counterparty to all exchange traded futures, guarantees the futures against default.
Futures contracts outstanding at period end are listed after the Fund's Portfolio of Investments.
The average notional value of long futures contracts held by the Fund throughout the period was $15,954,556. This is based on amounts held as of each month-end throughout the fiscal period.
Semi-Annual Shareholder Report
Securities LendingThe Fund participates in a securities lending program providing for the lending of equity securities to qualified brokers. The Fund normally receives cash collateral for securities loaned that is invested in an affiliated money market fund or in short-term securities including repurchase agreements. Collateral is maintained at a minimum level of 100% of the market value of investments loaned, plus interest, if applicable. Earnings on collateral are allocated between the securities lending agent, as a fee for its services under the program, and the Fund, according to agreed-upon rates.
As of April 30, 2012, securities subject to this type of arrangement and related collateral were as follows:
Market Value of Securities Loaned | Market Value of Collateral |
$36,992,702 | $38,507,202 |
Additional Disclosure Related to Derivative Instruments
Fair Value of Derivative Instruments | ||||
Liability | ||||
Statement of Assets and Liabilities Location | Fair Value | |||
Derivatives not accounted for as hedging instruments under ASC Topic 815 | ||||
Equity contracts | Payable for daily variation margin | $(531,376)* |
* | Includes cumulative appreciation/depreciation 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. |
The Effect of Derivative Instruments on the Statement of Operations for the Six Months Ended April 30, 2012
Amount of Realized Gain or (Loss) on Derivatives Recognized in Income | |
Futures | |
Equity contracts | $2,168,693 |
Change in Unrealized Appreciation or (Depreciation) on Derivatives Recognized in Income | |
Futures | |
Equity contracts | $(198,077) |
Other
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets, liabilities, expenses and revenues reported in the financial statements. Actual results could differ from those estimated.
Semi-Annual Shareholder Report
3. SHARES OF BENEFICIAL INTERESTThe following tables summarize share activity:
Period Ended 4/30/20121 | Year Ended 10/31/2011 | ||
Institutional Shares: | Shares | Amount | Shares | Amount |
Shares sold | 46,864 | $1,055,598 | — | — |
Shares issued to shareholders in payment of distributions declared | 99 | 2,261 | — | — |
Shares redeemed | (41) | (935) | — | — |
NET CHANGE RESULTING FROM INSTITUTIONAL SHARE TRANSACTIONS | 46,922 | $1,056,924 | — | — |
Six Months Ended 4/30/2012 | Year Ended 10/31/2011 | ||
Service Shares: | Shares | Amount | Shares | Amount |
Shares sold | 4,523,005 | $96,280,384 | 10,346,587 | $228,272,023 |
Shares issued to shareholders in payment of distributions declared | 2,045,602 | 41,792,013 | 1,120,436 | 23,840,324 |
Shares redeemed | (5,049,560) | (107,826,715) | (11,544,626) | (254,127,446) |
NET CHANGE RESULTING FROM SERVICE SHARE TRANSACTIONS | 1,519,047 | $30,245,682 | (77,603) | $(2,015,099) |
NET CHANGE RESULTING FROM TOTAL FUND SHARE TRANSACTIONS | 1,565,969 | $31,302,606 | (77,603) | $(2,015,099) |
1 | Reflects operations for the period from January 4, 2012 (date of initial investment) to April 30, 2012. |
4. FEDERAL TAX INFORMATION
At April 30, 2012, the cost of investments for federal tax purposes was $852,975,822. The net unrealized appreciation of investments for federal tax purposes excluding any unrealized appreciation resulting from futures contracts was $211,330,899. This consists of net unrealized appreciation from investments for those securities having an excess of value over cost of $282,810,706 and net unrealized depreciation from investments for those securities having an excess of cost over value of $71,479,807.
5. management FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Management Fee
Federated Equity Management Company of Pennsylvania is the Fund's manager (the “Manager”). The management agreement between the Fund and the Manager provides for an annual fee equal to 0.40% of the Fund's average daily net assets. Subject to the terms described in the Expense Limitation note, the Manager may voluntarily choose to waive any portion of its fee. For the six months ended April 30, 2012, the Manager voluntarily waived $898,013 of its fee.
Semi-Annual Shareholder Report
Shareholder Services FeeThe Fund may pay fees (“Service Fees”) up to 0.25% of the average daily net assets of the Fund's Shares to financial intermediaries or to Federated Shareholder Services Company (FSSC) for providing services to shareholders and maintaining shareholder accounts. Financial intermediaries may include a company affiliated with management of Federated Investors, Inc. Subject to the terms described in the Expense Limitation note, FSSC may voluntarily reimburse the Fund for Service Fees. For the six months ended April 30, 2012, FSSC received $4,371 of fees paid by the Fund.
Expense Limitation
The Manager and its affiliate (FSSC) have voluntarily agreed to waive their fees and/or reimburse expenses so that the total annual fund operating expenses (as shown in the financial highlights) paid by the Fund's Institutional Shares and Service Shares (after the voluntary waivers and reimbursements) will not exceed 0.29% and 0.54%, respectively, (the “Fee Limit”) up to but not including the later of (the “Termination Date”): (a) January 1, 2013; or (b) the date of the Fund's next effective Prospectus. While the Manager and its affiliates currently do not anticipate terminating or increasing this arrangement prior to the Termination Date, this arrangement may only be terminated or the Fee Limit increased prior to the Termination Date with the agreement of the Trustees.
General
Certain Officers and Trustees of the Fund are Officers and Directors or Trustees of the above companies.
Transactions Involving Affiliated Holdings
Affiliated holdings are mutual funds which are managed by the Manager or an affiliate of the Manager. The Manager has agreed to reimburse the Fund for certain investment management fees as a result of transactions in other affiliated mutual funds. For the six months ended April 30, 2012, the Manager reimbursed $26,790. Transactions involving the affiliated holding during the six months ended April 30, 2012, were as follows:
Federated Prime Value Obligations Fund, Institutional Shares |
Balance of Shares Held 10/31/2011 | 44,759,780 |
Purchases/Additions | 236,365,020 |
Sales/Reductions | 223,645,591 |
Balance of Shares Held 4/30/2012 | 57,479,209 |
Value | $57,479,209 |
Dividend Income | $14,178 |
6. Investment TRANSACTIONS
Purchases and sales of investments, excluding long-term U.S. government securities and short-term obligations, for the six months ended April 30, 2012, were as follows:
Purchases | $30,414,730 |
Sales | $19,340,080 |
7. INTERFUND LENDING
Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the Fund, along with other funds advised by subsidiaries of Federated Investors, Inc., may participate in an interfund lending program. This program provides an alternative credit facility allowing the Fund to borrow from other participating affiliated funds. As of April 30, 2012, there were no outstanding loans. During the six months ended April 30, 2012, the program was not utilized.
8. RECENT ACCOUNTING PRONOUNCEMENTS
In April 2011, the Financial Accounting Standards Board (FASB) released Accounting Standards Update (ASU) No. 2011-03, “Reconsideration of Effective Control for Repurchase Agreements.” This ASU amends FASB Accounting Standards Codification (ASC) Topic 860, “Transfers and Servicing”; specifically the criteria required to determine whether a repurchase agreement and similar agreements should be accounted for as sales of financial assets or secured borrowings with commitments. This ASU is effective for fiscal years and interim periods beginning after December 15, 2011. Management has concluded that the adoption of ASU No. 2011-03 is not expected to have a material impact on the Fund's financial statements and the accompanying notes, net assets or results of operations.
In addition, in May 2011, FASB released ASU No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” This ASU amends FASB ASC Topic 820, “Fair Value Measurement,” to establish common requirements for measuring fair value and for disclosing information about fair value measurements in accordance with GAAP. This ASU is effective for fiscal years and interim periods beginning after December 15, 2011. Management has concluded that the adoption of ASU No. 2011-04 is not expected to have a material impact on the Fund's financial statements and the accompanying notes.
Semi-Annual Shareholder ReportShareholder Expense Example (unaudited)
As a shareholder of the Fund, you incur ongoing costs, including management fees and to the extent applicable, distribution (12b-1) fees and/or shareholder services fees and other Fund expenses. This Example is intended to help you to understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. It is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from November 1, 2011 to April 30, 2012.
ACTUAL EXPENSES
The first section of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you incurred over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses attributable to your investment during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second section of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. Thus, you should not use the hypothetical account values and expenses to estimate the actual ending account balance or your expenses for the period. Rather, these figures are required to be provided to enable you to compare the ongoing costs of investing in the Fund with other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Semi-Annual Shareholder Report
Please note that the expenses shown in the table are meant to highlight your ongoing costs only. Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.Beginning Account Value 11/1/2011 | Ending Account Value 4/30/2012 | Expenses Paid During Period1 |
Actual: |
Institutional Shares | $1,000 | $1,119.90 | $0.992 |
Service Shares | $1,000 | $1,122.20 | $2.85 |
Hypothetical (assuming a 5% return before expenses): |
Institutional Shares | $1,000 | $1,015.19 | $0.942 |
Service Shares | $1,000 | $1,022.18 | $2.72 |
1 | Expenses are equal to the Fund's annualized net expense ratios, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half-year period). The annualized net expense ratios are as follows: |
Institutional Shares | 0.29% |
Service Shares | 0.54% |
2 | “Actual” expense information for the Fund's Institutional Shares is for the period from January 4, 2012 (date of initial investment) to April 30, 2012. Actual expenses are equal to the Fund's annualized net expense ratio of 0.29%, multiplied by 118/366 (to reflect the date of initial investment to April 30, 2012). “Hypothetical” expense information for Institutional Shares is presented on the basis of the full one-half year period to enable comparison to other funds. It is based on assuming the same net expense ratio and average account value over the period, but it is multiplied by 182/366 (to reflect the full half-year period). |
Evaluation and Approval of Advisory Contract – May 2011
Federated mid-cap index fund (the “Fund”)
The Fund's Board reviewed the Fund's investment advisory and subadvisory contracts at meetings held in May 2011. The Board's decision regarding these contracts reflects the exercise of its business judgment on whether to continue the existing arrangements.
In this connection, the Federated Funds' Board had previously appointed a Senior Officer, whose duties include specified responsibilities relating to the process by which advisory fees are to be charged to a Federated fund. The Senior Officer has the authority to retain consultants, experts, or staff as may be reasonably necessary to assist in the performance of his duties, reports directly to the Board, and may be terminated only with the approval of a majority of the independent members of the Board. The Senior Officer prepared and furnished to the Board an independent, written evaluation that covered topics discussed below (the “Evaluation”). The Board considered that Evaluation, along with other information, in deciding to approve the advisory and subadvisory contracts.
During its review of these contracts, the Board considered compensation and benefits received by the Adviser and subadviser. This included the fees received for services provided to the Fund by other entities in the Federated organization and research services (if any) received by the Adviser and subadviser from brokers that execute Federated fund trades, as well as advisory fees. The Board is also familiar with and considered judicial decisions concerning allegedly excessive investment advisory fees, which have indicated that the following factors may be relevant to an Adviser's fiduciary duty with respect to its receipt of compensation from a fund: the nature and quality of the services provided by the Adviser, including the performance of the Fund; the Adviser's cost of providing the services; the extent to which the Adviser may realize “economies of scale” as the Fund grows larger; any indirect benefits that may accrue to the Adviser and its affiliates as a result of the Adviser's relationship with the Fund; performance and expenses of comparable funds; and the extent to which the independent Board members are fully informed about all facts the Board deems relevant bearing on the Adviser's services and fees. The Board further considered management fees (including any components thereof) charged to institutional and other clients of the Adviser for what might be viewed as like services, and the cost to the Adviser and its affiliates of supplying services pursuant to the management fee agreements, excluding any intra-corporate profit and profit margins of the Adviser and its affiliates for supplying such services. Information regarding the subadviser's customary fee schedules was Semi-Annual Shareholder Report
included in the materials furnished by the subadviser in connection with the Board's review. The Board was aware of these factors and was guided by them in its review of the Fund's advisory and subadvisory contracts to the extent it considered them to be appropriate and relevant, as discussed further below.The Board considered and weighed these circumstances in light of its substantial accumulated experience in governing the Fund and working with Federated on matters relating to the Federated funds, and was assisted in its deliberations by independent legal counsel. Throughout the year, the Board has requested and received substantial and detailed information about the Fund and the Federated organization that was in addition to the extensive materials that comprise and accompany the Senior Officer's Evaluation. Federated provided much of this information at each regular meeting of the Board, and furnished additional information in connection with the particular meeting at which the Board's formal review of the advisory and subadvisory contracts occurred. Between regularly scheduled meetings, the Board also received information on particular matters as the need arose. Thus, the Board's consideration of the advisory and subadvisory contracts included review of the Senior Officer's Evaluation, accompanying data and additional information covering such matters as: the Adviser's and subadviser's profitability, investment philosophy, revenue, personnel and processes; investment and operating strategies; the Fund's short- and long-term performance (in absolute terms, both on a gross basis and net of expenses, as well as in relationship to its particular investment program and certain competitor or “peer group” funds and/or other benchmarks, as appropriate), and comments on the reasons for performance; the Fund's investment objectives; the Fund's expenses (including the advisory fee itself and the overall expense structure of the Fund, both in absolute terms and relative to similar and/or competing funds, with due regard for contractual or voluntary expense limitations); the use and allocation of brokerage commissions derived from trading the Fund's portfolio securities (if any); and the nature, quality and extent of the advisory and other services provided to the Fund by the Adviser, the subadviser, and their affiliates. The Board also considered the preferences and expectations of Fund shareholders and their relative sophistication; the continuing state of competition in the mutual fund industry and market practices; the range of comparable fees for similar funds in the mutual fund industry; the Fund's relationship to the Federated family of funds which include a comprehensive array of funds with different investment objectives, policies and strategies which are available for exchange without the incurrence of additional sales charges; compliance and audit reports concerning the Federated funds, the Federated companies that service them, and the subadviser (including communications from regulatory agencies), as well as Federated's and/or the subadviser's responses to any issues raised therein; and relevant developments in Semi-Annual Shareholder Report
the mutual fund industry and how the Federated funds and/or Federated are responding to them. The Board's evaluation process is evolutionary. The criteria considered and the emphasis placed on relevant criteria change in recognition of changing circumstances in the mutual fund marketplace.With respect to the Fund's performance and expenses in particular, the Board has found the use of comparisons to other mutual funds with comparable investment programs to be relevant, given the high degree of competition in the mutual fund business. The Board focused on comparisons with other similar mutual funds more heavily than non-mutual fund products or services because it is believed that they are more relevant. For example, other mutual funds are the products most like the Fund, they are readily available to Fund shareholders as alternative investment vehicles, and they are the type of investment vehicle in fact chosen and maintained by the Fund's investors. The range of their fees and expenses therefore appears to be a generally reliable indication of what consumers have found to be reasonable in the precise marketplace in which the Fund competes. The Fund's ability to deliver competitive performance when compared to its peer group was a useful indicator of how the Adviser and subadviser are executing the Fund's investment program, which in turn assisted the Board in reaching a conclusion that the nature, extent, and quality of the Adviser's and subadviser's investment management services were such as to warrant continuation of the advisory and subadvisory contracts. In this regard, the Senior Officer has reviewed Federated's and the subadviser's fees for providing advisory services to products outside the Federated family of funds (e.g., institutional and separate accounts). He concluded that mutual funds and institutional accounts are inherently different products. Those differences included, but are not limited to, different types of targeted investors, being subject to different laws and regulations, different legal structures, different average account sizes, different associated costs, different portfolio management techniques made necessary by different cash flows, and portfolio manager time spent in review of securities pricing. The Senior Officer did not consider these fee schedules to be determinative in judging the appropriateness of mutual fund advisory contracts.
The Senior Officer reviewed information compiled by Federated, using data supplied by independent fund ranking organizations, regarding the performance of, and fees charged by, other mutual funds, noting his view that comparisons to fund peer groups are relevant in judging the reasonableness of proposed fees.
The Fund's performance fell below the median of the relevant peer group for the one-year, three-year and five-year periods covered by the Evaluation. The Board discussed the Fund's performance with the Adviser and recognized the efforts being undertaken by the Adviser and subadviser. The Board will continue to monitor these efforts and the performance of the Fund.
Semi-Annual Shareholder Report
The Board also received financial information about Federated, including information regarding the compensation and benefits Federated derived from its relationships with the Federated funds. This information covered not only the fees under the advisory contracts, but also fees received by Federated's subsidiaries for providing other services to the Federated funds under separate contracts (e.g., for serving as the Federated funds' administrator). The information also detailed any indirect benefit Federated may derive from its receipt of research services from brokers who execute Federated fund trades. In addition, the Board considered the fact that, in order for a fund to be competitive in the marketplace, Federated and its affiliates frequently waived fees and/or reimbursed expenses and have disclosed to fund investors and/or indicated to the Board their intention to do so in the future, where appropriate. Moreover, the Board receives regular reporting as to the institution or elimination of these voluntary waivers. The Board also received financial information about the subadviser, as well as information that discussed any indirect benefit the subadviser may derive from its receipt of research services from brokers who execute Fund trades.Federated furnished information, requested by the Senior Officer, that reported revenues on a fund-by-fund basis and made estimates of the allocation of expenses on a fund-by-fund basis, using allocation methodologies specified by the Senior Officer. The Senior Officer noted that, although they may apply consistent allocation processes, the inherent difficulties in allocating costs (and the unavoidable arbitrary aspects of that exercise) and the lack of consensus on how to allocate those costs may render such allocation information unreliable. The Board received similar revenue and cost information about the Fund from the subadviser. The allocation information was considered in the analysis by the Board but was determined to be of limited use.
The Board and the Senior Officer also reviewed information compiled by Federated comparing profitability information for Federated and the subadviser to other publicly held fund management companies. In this regard, the Senior Officer noted the limited availability of such information, but nonetheless concluded that Federated's and the subadviser's profit margins did not appear to be excessive and the Board agreed.
The Senior Officer's Evaluation also discussed the notion of possible realization of “economies of scale” as a fund grows larger. The Board considered in this regard that the Adviser has made significant and long-term investments in areas that support all of the Federated funds, such as personnel and processes for the portfolio management, compliance, internal audit, and risk management functions; and systems technology; and that the benefits of these efforts (as well as any economies, should they exist) were likely to be enjoyed by the fund complex as a whole. Finally, the Board also noted the absence of any applicable regulatory or industry guidelines on this subject, which (as discussed in the Senior Officer's Evaluation) is compounded by the lack of any common Semi-Annual Shareholder Report
industry practice or general pattern with respect to structuring fund advisory fees with “breakpoints” that serve to reduce the fee as the fund attains a certain size. The Senior Officer did not recommend institution of breakpoints in pricing Federated's fund advisory services at this time.It was noted in the materials for the Board meeting that, for the period covered by the Evaluation, the Fund's investment advisory fee, after waivers and expense reimbursements, if any, was above the median of the relevant peer group. The Board reviewed the fees and other expenses of the Fund with the Adviser and was satisfied that the overall expense structure of the Fund remained competitive. The Board will continue to monitor advisory fees and other expenses borne by the Fund.
The Senior Officer noted that, considering the totality of the circumstances, and all of the factors referenced within his Evaluation, he had concluded that, subject to comments and recommendations made within his Evaluation, his observations and the information accompanying the Evaluation supported a finding by the Board that the management fees for each of the funds are reasonable and that Federated appeared to provide appropriate administrative services to the Fund for the fees paid. Under these circumstances, no changes were recommended to, and no objection was raised to, the continuation of the Fund's advisory and subadvisory contracts. The Board concluded that the nature, quality and scope of services provided the Fund by the Adviser and its affiliates, and by the subadviser, were satisfactory.
In its decision to continue an existing investment advisory contract, the Board was mindful of the potential disruptions of the Fund's operations and various risks, uncertainties and other effects that could occur as a result of a decision to terminate or not renew an advisory contract. In particular, the Board recognized that many shareholders have invested in the Fund on the strength of the Adviser's industry standing and reputation and with the expectation that the Adviser will have a continuing role in providing advisory services to the Fund. Thus, the Board's approval of the advisory contract reflected the fact that it is the shareholders who have effectively selected the Adviser by virtue of having invested in the Fund.
The Board based its decision to approve the advisory and subadvisory contracts on the totality of the circumstances and relevant factors and with a view to past and future long-term considerations. Not all of the factors and considerations identified above were necessarily relevant to the Fund, nor did the Board consider any one of them to be determinative. With respect to the factors that were relevant, the Board's decision to approve the contract reflects its determination that Federated's performance and actions provided a satisfactory basis to support the decision to continue the existing arrangements.
Semi-Annual Shareholder ReportVoting Proxies on Fund Portfolio Securities
A description of the policies and procedures that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 1-800-341-7400. A report on “Form N-PX” of how the Fund voted any such proxies during the most recent 12-month period ended June 30 is available from Federated's website at FederatedInvestors.com. To access this information from the home page, select “All” under “Asset Classes.” Select a fund name and share class, if applicable, to go to the Fund Overview page. On the Fund Overview page, select the “Documents” tab. At the bottom of that page, select “Proxy Voting Record Report (Form N-PX).” Form N-PX filings are also available at the SEC's website at www.sec.gov.
The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on “Form N-Q.” These filings are available on the SEC's website at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. (Call 1-800-SEC-0330 for information on the operation of the Public Reference Room.) You may also access this information from the “Products” section of Federated's website at FederatedInvestors.com. From the home page, select “All” under “Asset Classes.” Select a fund name and share class, if applicable, to go to the Fund Overview page. On the Fund Overview page, select the “Documents” tab. At the bottom of that page, select “Form N-Q.”
Semi-Annual Shareholder ReportMutual funds are not bank deposits or obligations, are not guaranteed by any bank and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency. Investment in mutual funds involves investment risk, including the possible loss of principal.
This Report is authorized for distribution to prospective investors only when preceded or accompanied by the Fund's Prospectus, which contains facts concerning its objective and policies, management fees, expenses and other information.
IMPORTANT NOTICE ABOUT FUND DOCUMENT DELIVERY
In an effort to reduce costs and avoid duplicate mailings, the Fund(s) intend to deliver a single copy of certain documents to each household in which more than one shareholder of the Fund(s) resides (so-called “householding”), as permitted by applicable rules. The Fund's “householding” program covers its/their Prospectus and Statement of Additional Information, and supplements to each, as well as Semi-Annual and Annual Shareholder Reports and any Proxies or information statements. Shareholders must give their written consent to participate in the “householding” program. The Fund is also permitted to treat a shareholder as having given consent (“implied consent”) if (i) shareholders with the same last name, or believed to be members of the same family, reside at the same street address or receive mail at the same post office box, (ii) the Fund gives notice of its intent to “household” at least sixty (60) days before it begins “householding” and (iii) none of the shareholders in the household have notified the Fund(s) or their agent of the desire to “opt out” of “householding.” Shareholders who have granted written consent, or have been deemed to have granted implied consent, can revoke that consent and opt out of “householding” at any time: shareholders who purchased shares through an intermediary should contact their representative; other shareholders may call the Fund at 1-800-341-7400.
Federated Mid-Cap Index Fund
Federated Investors Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
Contact us at FederatedInvestors.com
or call 1-800-341-7400.
Federated Securities Corp., Distributor
CUSIP 31420E882
CUSIP 31420E205
3042108 (6/12)
Federated is a registered trademark of Federated Investors, Inc.
2012 © Federated Investors, Inc.
Semi-Annual Shareholder Report | ||
April 30, 2012 | ||
Share Class | Ticker |
C | MXCCX |
R | FMXKX |
Institutional | FISPX |
Service* | FMXSX |
*formerly, Institutional Service Shares
Federated Max-Cap Index Fund
A Portfolio of Federated Index Trust
CONTENTS
Portfolio of Investments Summary Table (unaudited)
At April 30, 2012, the Fund's sector composition1 for its equity security investments was as follows:
Sector | Percentage of Total Net Assets |
Information Technology | 19.6% |
Financials | 14.1% |
Energy | 11.0% |
Health Care | 11.0% |
Consumer Discretionary | 10.9% |
Consumer Staples | 10.6% |
Industrials | 10.1% |
Materials | 3.3% |
Utilities | 3.3% |
Telecommunication Services | 2.8% |
Other Securities2 | 0.3% |
Derivative Contracts3 | 0.1% |
Cash Equivalents4 | 3.0% |
Other Assets and Liabilities — Net5 | (0.1)% |
TOTAL6 | 100.0% |
1 | Except for Other Securities, Derivative Contracts, 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 Manager assigns a classification to securities not classified by the GICS and to securities for which the Manager does not have access to the classification made by the GICS. |
2 | Other Securities include an exchange-traded fund and a warrant. |
3 | Based upon net unrealized appreciation (depreciation) or value of the derivative contracts, as applicable. Derivative contracts may consist of futures, forwards, options and swaps. The impact of a derivative contract on the Fund's performance may be larger than its unrealized appreciation (depreciation) may indicate. In many cases, the notional value or notional principal amount of a derivative contract may provide a better indication of the contract's significance to the portfolio. More complete information regarding the Fund's direct investments in derivative contracts, including unrealized appreciation (depreciation) 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. |
4 | Cash Equivalents include any investments in money market mutual funds and/or overnight repurchase agreements. |
5 | Assets, other than investments in securities and derivative contracts, less liabilities. See Statement of Assets and Liabilities. |
6 | The Fund purchases index futures contracts to efficiently manage cash flows resulting from shareholder purchases and redemptions, dividend and capital gain payments to shareholders and corporate actions while maintaining exposure to the Standard & Poor's 500 Composite Stock Price (S&P 500) Index and minimizing trading costs. Taking into consideration these open index futures contracts, the Fund's effective total exposure to the S&P 500 Index is effectively 99.8%. |
April 30, 2012 (unaudited)
Shares | Value |
COMMON STOCKS – 96.7%1 |
Consumer Discretionary – 10.9% |
754 | Aaron's, Inc. | 20,486 |
3,290 | Abercrombie & Fitch Co., Class A | 165,059 |
3,095 | Advance Auto Parts, Inc. | 284,121 |
15,000 | 2 | Amazon.com, Inc. | 3,478,500 |
14,463 | 2 | Apollo Group, Inc., Class A | 509,387 |
1,537 | 2 | AutoNation, Inc. | 53,149 |
2,584 | 2 | AutoZone, Inc. | 1,023,677 |
8,029 | 2 | Bed Bath & Beyond, Inc. | 565,161 |
9,604 | Best Buy Co., Inc. | 211,960 |
2,183 | 2 | Big Lots, Inc. | 79,985 |
9,988 | Block (H&R), Inc. | 146,824 |
3,703 | 2 | BorgWarner, Inc. | 292,685 |
22,011 | CBS Corp. (New), Class B | 734,067 |
7,298 | Cablevision Systems Corp., Class A | 108,156 |
7,643 | 2 | CarMax, Inc. | 235,939 |
15,361 | Carnival Corp. | 499,079 |
2,800 | 2 | Charter Communications, Inc. | 169,316 |
1,061 | 2 | Chipotle Mexican Grill, Inc. | 439,413 |
200 | Choice Hotels International, Inc. | 7,524 |
19,370 | Coach, Inc. | 1,417,109 |
96,725 | Comcast Corp., Class A | 2,933,669 |
9,386 | D. R. Horton, Inc. | 153,461 |
31,036 | 2 | DIRECTV Group, Inc., Class A | 1,529,144 |
4,333 | Darden Restaurants, Inc. | 216,997 |
2,073 | DeVRY, Inc. | 66,647 |
8,768 | 2 | Discovery Communications, Inc. | 477,155 |
3,203 | 2 | Discovery Communications, Inc. | 159,157 |
2,282 | 2 | Dollar General Corp. | 108,304 |
5,552 | 2 | Dollar Tree, Inc. | 564,416 |
3,189 | Expedia, Inc. | 135,947 |
4,037 | Family Dollar Stores, Inc. | 272,699 |
166,668 | Ford Motor Co. | 1,880,015 |
1,753 | 2 | Fossil, Inc. | 229,065 |
4,703 | GameStop Corp. | 107,040 |
8,618 | Gannett Co., Inc. | 119,101 |
Shares | Value |
11,264 | Gap (The), Inc. | 321,024 |
2,900 | Garmin Ltd. | 136,677 |
6,318 | Genuine Parts Co. | 409,280 |
8,477 | 2 | Goodyear Tire & Rubber Co. | 93,077 |
1,800 | 2 | Groupon, Inc. | 19,278 |
7,753 | Harley-Davidson, Inc. | 405,715 |
2,375 | Harman International Industries, Inc. | 117,753 |
5,309 | Hasbro, Inc. | 195,053 |
55,119 | Home Depot, Inc. | 2,854,613 |
1,627 | 2 | ITT Educational Services, Inc. | 107,415 |
10,171 | International Game Technology | 158,464 |
14,951 | Interpublic Group of Cos., Inc. | 176,571 |
23,085 | Johnson Controls, Inc. | 738,027 |
8,596 | Kohl's Corp. | 430,917 |
1,500 | Lear Corp. | 62,250 |
4,674 | Leggett and Platt, Inc. | 101,753 |
5,477 | Lennar Corp., Class A | 151,932 |
5,300 | 2 | Liberty Media Corp. | 463,432 |
8,343 | Limited Brands, Inc. | 414,647 |
42,078 | Lowe's Cos., Inc. | 1,324,195 |
2,472 | 2 | Lululemon Athletica, Inc. | 183,274 |
16,123 | Macy's, Inc. | 661,365 |
9,060 | Marriott International, Inc., Class A | 354,155 |
700 | 2 | Marriott Vacations Worldwide Corp. | 20,671 |
11,497 | Mattel, Inc. | 386,299 |
48,810 | McDonald's Corp. | 4,756,535 |
11,577 | McGraw-Hill Cos., Inc. | 569,241 |
5,200 | 2 | Michael Kors Holdings Ltd. | 237,484 |
310 | 2 | NVR, Inc. | 243,021 |
1,863 | 2 | NetFlix, Inc. | 149,301 |
9,913 | Newell Rubbermaid, Inc. | 180,417 |
72,980 | News Corp., Inc. | 1,430,408 |
15,748 | Nike, Inc., Class B | 1,761,729 |
5,423 | Nordstrom, Inc. | 302,929 |
4,318 | 2 | O'Reilly Automotive, Inc. | 455,376 |
9,252 | Omnicom Group, Inc. | 474,720 |
844 | 2 | Penn National Gaming, Inc. | 37,963 |
4,892 | Penney (J.C.) Co., Inc. | 176,406 |
Shares | Value |
2,619 | 2 | Priceline.com, Inc. | 1,992,588 |
11,564 | 2 | Pulte Group, Inc. | 113,790 |
2,923 | Ralph Lauren Corp. | 503,545 |
8,503 | Ross Stores, Inc. | 523,700 |
1,564 | 2 | Sally Beauty Holdings, Inc. | 41,602 |
3,194 | Scripps Networks Interactive | 160,403 |
1,277 | 2 | Sears Holdings Corp. | 68,677 |
23,543 | Staples, Inc. | 362,562 |
25,545 | Starbucks Corp. | 1,465,772 |
6,652 | Starwood Hotels & Resorts Worldwide, Inc. | 393,798 |
29,746 | TJX Cos., Inc. | 1,240,706 |
26,109 | Target Corp. | 1,512,755 |
4,309 | 2 | Tempur-Pedic International, Inc. | 253,542 |
4,295 | Tiffany & Co. | 294,036 |
17,399 | Time Warner Cable, Inc. | 1,399,750 |
55,823 | Time Warner, Inc. | 2,091,130 |
4,070 | 2 | TripAdvisor, Inc. | 152,666 |
1,648 | Tupperware Brands Corp. | 102,654 |
3,737 | 2 | Urban Outfitters, Inc. | 108,224 |
2,963 | V.F. Corp. | 450,524 |
34,354 | Viacom, Inc., Class B | 1,593,682 |
300 | 2 | Visteon Corp. | 15,051 |
63,613 | Walt Disney Co. | 2,742,356 |
210 | Washington Post Co., Class B | 79,416 |
219 | Weight Watchers International, Inc. | 16,635 |
2,600 | Whirlpool Corp. | 166,452 |
486 | Wiley (John) & Sons, Inc., Class A | 21,962 |
4,923 | Wyndham Worldwide Corp. | 247,824 |
4,272 | Wynn Resorts Ltd. | 569,885 |
15,611 | Yum! Brands, Inc. | 1,135,388 |
TOTAL | 60,278,856 |
Consumer Staples – 10.6% |
69,849 | Altria Group, Inc. | 2,249,836 |
22,437 | Archer-Daniels-Midland Co. | 691,733 |
14,551 | Avon Products, Inc. | 314,302 |
5,317 | Beam, Inc. | 301,899 |
10,639 | Brown-Forman Corp., Class B | 918,678 |
53,119 | CVS Caremark Corp. | 2,370,170 |
Shares | Value |
6,015 | Campbell Soup Co. | 203,487 |
11,903 | Clorox Co. | 834,400 |
12,882 | Coca-Cola Enterprises, Inc. | 388,006 |
16,260 | Colgate-Palmolive Co. | 1,608,764 |
14,785 | ConAgra Foods, Inc. | 381,749 |
21,129 | 2 | Constellation Brands, Inc., Class A | 456,386 |
24,604 | Costco Wholesale Corp. | 2,169,335 |
6,149 | 2 | Dean Foods Co. | 75,510 |
23,211 | Dr. Pepper Snapple Group, Inc. | 941,902 |
8,285 | Estee Lauder Cos., Inc., Class A | 541,425 |
21,860 | General Mills, Inc. | 850,135 |
10,849 | H.J. Heinz Co. | 578,360 |
728 | Harris Teeter Supermarkets, Inc. | 27,642 |
5,180 | Hershey Foods Corp. | 347,112 |
7,158 | Hormel Foods Corp. | 208,011 |
8,359 | Kellogg Co. | 422,715 |
13,349 | Kimberly-Clark Corp. | 1,047,496 |
61,103 | Kraft Foods, Inc., Class A | 2,436,177 |
43,758 | Kroger Co. | 1,018,249 |
8,230 | Lorillard, Inc. | 1,113,437 |
4,467 | McCormick & Co., Inc. | 249,750 |
15,083 | Mead Johnson Nutrition Co. | 1,290,502 |
18,935 | Molson Coors Brewing Co., Class B | 787,317 |
58,591 | PepsiCo, Inc. | 3,867,006 |
71,646 | Philip Morris International, Inc. | 6,413,033 |
5,035 | Post Holdings, Inc. | 149,791 |
117,888 | Procter & Gamble Co. | 7,502,392 |
14,830 | Reynolds American, Inc. | 605,509 |
9,167 | Safeway, Inc. | 186,365 |
20,065 | Sara Lee Corp. | 442,233 |
3,845 | Smucker (J.M.) Co. | 306,177 |
19,824 | Sysco Corp. | 572,914 |
88,822 | The Coca-Cola Co. | 6,778,895 |
37,990 | Tyson Foods, Inc., Class A | 693,318 |
70,277 | Wal-Mart Stores, Inc. | 4,140,018 |
46,154 | Walgreen Co. | 1,618,159 |
5,505 | Whole Foods Market, Inc. | 457,300 |
TOTAL | 58,557,595 |
Shares | Value |
Energy – 11.0% |
7,393 | 2 | Alpha Natural Resources, Inc. | 119,249 |
21,195 | Anadarko Petroleum Corp. | 1,551,686 |
18,105 | Apache Corp. | 1,736,994 |
14,860 | Baker Hughes, Inc. | 655,475 |
7,650 | CONSOL Energy, Inc. | 254,286 |
7,186 | Cabot Oil & Gas Corp., Class A | 252,516 |
8,349 | 2 | Cameron International Corp. | 427,886 |
1,081 | Carbo Ceramics, Inc. | 90,901 |
22,468 | Chesapeake Energy Corp. | 414,310 |
89,130 | Chevron Corp. | 9,497,693 |
61,579 | ConocoPhillips | 4,410,904 |
13,242 | 2 | Denbury Resources, Inc. | 252,128 |
16,243 | Devon Energy Corp. | 1,134,574 |
2,361 | Diamond Offshore Drilling, Inc. | 161,847 |
2,286 | 2 | Dresser-Rand Group, Inc. | 111,282 |
10,366 | EOG Resources, Inc. | 1,138,290 |
5,038 | EQT Corp. | 250,993 |
26,208 | El Paso Corp. | 777,591 |
200,147 | Exxon Mobil Corp. | 17,280,692 |
8,091 | 2 | FMC Technologies, Inc. | 380,277 |
37,496 | Halliburton Co. | 1,283,113 |
3,685 | Helmerich & Payne, Inc. | 189,372 |
10,261 | Hess Corp. | 535,009 |
7,488 | HollyFrontier Corp. | 230,780 |
1,440 | 2 | Kinder Morgan Management LLC | 109,607 |
2,208 | 2 | Kosmos Energy LLC | 26,893 |
27,605 | Marathon Oil Corp. | 809,931 |
28,239 | Marathon Petroleum Corp. | 1,175,025 |
7,393 | Murphy Oil Corp. | 406,393 |
9,878 | 2 | Nabors Industries Ltd. | 164,469 |
17,104 | National-Oilwell, Inc. | 1,295,799 |
4,526 | 2 | Newfield Exploration Co. | 162,483 |
8,550 | Noble Corp. | 325,413 |
6,253 | Noble Energy, Inc. | 621,048 |
38,691 | Occidental Petroleum Corp. | 3,529,393 |
599 | 2 | Oil States International, Inc. | 47,668 |
11,587 | Peabody Energy Corp. | 360,472 |
4,181 | Pioneer Natural Resources, Inc. | 484,243 |
Shares | Value |
6,066 | QEP Resources, Inc. | 186,893 |
5,355 | Range Resources Corp. | 356,964 |
4,134 | 2 | Rowan Cos., Inc. | 142,747 |
59,768 | Schlumberger Ltd. | 4,431,200 |
11,839 | 2 | Southwestern Energy Co. | 373,876 |
22,081 | Spectra Energy Corp. | 678,770 |
3,622 | Sunoco, Inc. | 178,528 |
4,685 | 2 | Tesoro Petroleum Corp. | 108,926 |
23,111 | Valero Energy Corp. | 570,842 |
19,073 | 2 | WPX Energy, Inc. | 335,113 |
20,082 | Williams Cos., Inc. | 683,390 |
TOTAL | 60,703,934 |
Financials – 14.1% |
14,439 | Ace Ltd. | 1,096,931 |
21,078 | Aflac, Inc. | 949,353 |
16,899 | Allstate Corp. | 563,244 |
34,408 | American Express Co. | 2,071,706 |
18,247 | 2 | American International Group, Inc. | 620,945 |
13,351 | American Tower Corp. | 875,559 |
10,846 | Ameriprise Financial, Inc. | 587,962 |
11,028 | Aon PLC | 571,250 |
4,082 | Apartment Investment & Management Co., Class A | 110,826 |
3,010 | Assurant, Inc. | 121,423 |
3,230 | Avalonbay Communities, Inc. | 469,642 |
26,743 | BB&T Corp. | 856,846 |
799 | BRE Properties, Inc., Class A | 41,947 |
449,434 | Bank of America Corp. | 3,644,910 |
553 | Bank of Montreal | 32,832 |
40,877 | Bank of New York Mellon Corp. | 966,741 |
700 | BankUnited, Inc. | 17,220 |
67,993 | 2 | Berkshire Hathaway, Inc. | 5,470,037 |
4 | 2 | Berkshire Hathaway, Inc., Class A | 483,200 |
4,274 | BlackRock, Inc. | 818,813 |
5,964 | Boston Properties, Inc. | 645,603 |
11,128 | 2 | CBRE Group, Inc. | 209,318 |
2,579 | CME Group, Inc. | 685,550 |
368 | CNA Financial Corp. | 11,268 |
5,951 | Camden Property Trust | 402,704 |
Shares | Value |
33,471 | Capital One Financial Corp. | 1,856,971 |
36,649 | Charles Schwab Corp. | 524,081 |
9,195 | Chubb Corp. | 671,879 |
5,567 | Cincinnati Financial Corp. | 198,297 |
126,651 | Citigroup, Inc. | 4,184,549 |
6,680 | Comerica, Inc. | 213,894 |
715 | Cullen Frost Bankers, Inc. | 42,156 |
38,830 | Discover Financial Services | 1,316,337 |
10,645 | 2 | E*Trade Group, Inc. | 113,156 |
13,022 | Equity Residential Properties Trust | 800,072 |
3,099 | 3 | Federated Investors, Inc. | 68,426 |
15,362 | Fidelity National Financial, Inc., Class A | 296,026 |
38,014 | Fifth Third Bancorp | 540,939 |
46 | First Citizens Bancshares, Inc., Class A | 7,972 |
8,569 | First Horizon National Corp. | 78,663 |
1,411 | First Republic Bank | 46,605 |
5,479 | Franklin Resources, Inc. | 687,669 |
16,550 | 2 | Genworth Financial, Inc., Class A | 99,465 |
24,065 | Goldman Sachs Group, Inc. | 2,771,085 |
13,888 | HCP, Inc. | 575,658 |
16,976 | Hartford Financial Services Group, Inc. | 348,857 |
7,360 | Health Care REIT, Inc. | 417,018 |
1,927 | Home Properties, Inc. | 117,643 |
26,629 | Host Marriott Corp. | 443,107 |
268 | 2 | Howard Hughes Corp. | 17,985 |
17,704 | Hudson City Bancorp, Inc. | 124,990 |
29,600 | Huntington Bancshares, Inc. | 198,024 |
2,504 | 2 | InterContinentalExchange, Inc. | 333,132 |
16,333 | Invesco Ltd. | 405,712 |
174,352 | JPMorgan Chase & Co. | 7,493,649 |
40,218 | KeyCorp | 323,353 |
17,090 | Kimco Realty Corp. | 331,717 |
7,292 | Legg Mason, Inc. | 190,102 |
6,813 | Leucadia National Corp. | 169,371 |
9,863 | Lincoln National Corp. | 244,306 |
10,363 | Loews Corp. | 426,230 |
4,382 | M & T Bank Corp. | 378,035 |
24,231 | Marsh & McLennan Cos., Inc. | 810,527 |
Shares | Value |
54,810 | MetLife, Inc. | 1,974,804 |
6,599 | Moody's Corp. | 270,229 |
61,460 | Morgan Stanley | 1,062,029 |
5,944 | NASDAQ Stock Market, Inc. | 146,044 |
10,405 | NYSE Euronext | 267,929 |
8,178 | Northern Trust Corp. | 389,191 |
22,403 | PNC Financial Services Group | 1,485,767 |
12,298 | People's United Financial, Inc. | 151,757 |
1,430 | Piedmont Office Realty Trust, Inc. | 25,368 |
5,425 | Plum Creek Timber Co., Inc. | 228,067 |
10,227 | Principal Financial Group | 282,981 |
20,740 | Progressive Corp., OH | 441,762 |
15,611 | ProLogis, Inc. | 558,562 |
24,861 | Prudential Financial, Inc. | 1,505,085 |
6,892 | Public Storage, Inc. | 987,348 |
1,818 | Rayonier, Inc. | 82,446 |
53,888 | Regions Financial Corp. | 363,205 |
900 | 2 | Rouse Properties, Inc. | 12,096 |
390 | SL Green Realty Corp. | 32,152 |
17,185 | SLM Corp. | 254,854 |
10,384 | Simon Property Group, Inc. | 1,615,750 |
16,996 | State Street Corp. | 785,555 |
22,556 | SunTrust Banks, Inc. | 547,660 |
9,275 | T. Rowe Price Group, Inc. | 585,392 |
14,190 | The Travelers Cos., Inc. | 912,701 |
3,375 | Torchmark Corp. | 164,396 |
76,678 | U.S. Bancorp | 2,466,731 |
12,448 | Unum Group | 295,516 |
13,633 | Ventas, Inc. | 801,484 |
6,805 | Vornado Realty Trust L.P. | 584,141 |
222,572 | Wells Fargo & Co. | 7,440,582 |
24,853 | Weyerhaeuser Co. | 506,007 |
13,762 | Willis Group Holdings PLC | 501,762 |
10,711 | XL Group PLC | 230,394 |
6,178 | Zions Bancorp | 125,969 |
TOTAL | 78,279,204 |
Health Care – 11.0% |
64,982 | Abbott Laboratories | 4,032,783 |
Shares | Value |
11,883 | Aetna, Inc. | 523,327 |
13,317 | Agilent Technologies, Inc. | 561,711 |
1,510 | 2 | Alexion Pharmaceuticals, Inc. | 136,383 |
10,327 | Allergan, Inc. | 991,392 |
8,716 | 2 | Allscripts Healthcare Solutions, Inc. | 96,573 |
12,872 | AmerisourceBergen Corp. | 478,967 |
28,184 | Amgen, Inc. | 2,004,164 |
9,055 | Bard (C.R.), Inc. | 896,083 |
22,723 | Baxter International, Inc. | 1,259,081 |
7,125 | Becton, Dickinson & Co. | 558,956 |
10,293 | 2 | Biogen Idec, Inc. | 1,379,365 |
62,134 | 2 | Boston Scientific Corp. | 388,959 |
57,235 | Bristol-Myers Squibb Co. | 1,909,932 |
9,718 | CIGNA Corp. | 449,263 |
18,902 | Cardinal Health, Inc. | 798,988 |
23,517 | 2 | CareFusion Corp. | 609,325 |
17,053 | 2 | Celgene Corp. | 1,243,505 |
4,961 | 2 | Cerner Corp. | 402,288 |
4,761 | Coventry Health Care, Inc. | 142,782 |
16,390 | Covidien PLC | 905,220 |
3,158 | 2 | DaVita, Inc. | 279,736 |
4,858 | Dentsply International, Inc. | 199,469 |
3,941 | 2 | Edwards Lifesciences Corp. | 326,985 |
56,787 | Eli Lilly & Co. | 2,350,414 |
263 | 2 | Endo Pharmaceuticals Holdings, Inc. | 9,242 |
30,071 | 2 | Express Scripts Holding Co. | 1,677,661 |
9,408 | 2 | Forest Laboratories, Inc., Class A | 327,681 |
133 | 2 | Gen-Probe, Inc. | 10,846 |
36,393 | 2 | Gilead Sciences, Inc. | 1,892,800 |
1,302 | 2 | HCA, Inc. | 35,050 |
5,532 | 2 | Hospira, Inc. | 194,284 |
13,076 | Humana, Inc. | 1,054,972 |
6,251 | 2 | Illumina, Inc. | 278,357 |
1,333 | 2 | Intuitive Surgical, Inc. | 770,741 |
116,461 | Johnson & Johnson | 7,580,447 |
3,297 | 2 | Laboratory Corp. of America Holdings | 289,773 |
6,024 | 2 | Life Technologies Corp. | 279,273 |
16,100 | McKesson Corp. | 1,471,701 |
Shares | Value |
35,282 | Medtronic, Inc. | 1,347,772 |
127,430 | Merck & Co., Inc. | 5,000,353 |
14,449 | 2 | Mylan Laboratories, Inc. | 313,688 |
12,046 | 2 | Myriad Genetics, Inc. | 313,316 |
29 | Novartis AG, ADR | 1,600 |
2,908 | Patterson Cos., Inc. | 99,134 |
3,943 | PerkinElmer, Inc. | 108,827 |
3,155 | Perrigo Co. | 330,960 |
295,970 | Pfizer, Inc. | 6,786,592 |
5,441 | Quest Diagnostics, Inc. | 313,891 |
1,700 | 2 | SXC Health Solutions Corp. | 153,986 |
747 | 2 | Sirona Dental Systems, Inc. | 37,731 |
10,898 | St. Jude Medical, Inc. | 421,971 |
12,283 | Stryker Corp. | 670,283 |
14,112 | 2 | Tenet Healthcare Corp. | 73,241 |
14,350 | Thermo Fisher Scientific, Inc. | 798,578 |
2,526 | 2 | Thoratec Laboratories Corp. | 87,930 |
37,133 | UnitedHealth Group, Inc. | 2,085,018 |
3,798 | 2 | Varian Medical Systems, Inc. | 240,869 |
3,440 | 2 | Waters Corp. | 289,338 |
13,347 | 2 | Watson Pharmaceuticals, Inc. | 1,005,830 |
14,492 | Wellpoint, Inc. | 982,847 |
6,042 | Zimmer Holdings, Inc. | 380,223 |
TOTAL | 60,642,457 |
Industrials – 10.1% |
29,523 | 3M Co. | 2,638,175 |
2,645 | 2 | AGCO Corp. | 123,178 |
3,635 | Avery Dennison Corp. | 116,247 |
3,332 | 2 | Babcock & Wilcox Co. | 81,967 |
29,585 | Boeing Co. | 2,272,128 |
543 | Brinks Co. (The) | 13,792 |
9,279 | C.H. Robinson Worldwide, Inc. | 554,327 |
35,683 | CSX Corp. | 796,088 |
26,654 | Caterpillar, Inc. | 2,739,232 |
1,300 | Chicago Bridge & Iron Co., N.V. | 57,746 |
3,732 | Cintas Corp. | 146,182 |
631 | 2 | Clean Harbors, Inc. | 43,059 |
5,557 | Cooper Industries PLC | 347,702 |
Shares | Value |
790 | 2 | Copart, Inc. | 20,864 |
214 | Corporate Executive Board Co. | 8,853 |
9,678 | Cummins, Inc. | 1,121,003 |
19,399 | Danaher Corp. | 1,051,814 |
15,568 | Deere & Co. | 1,282,181 |
14,991 | 2 | Delta Air Lines, Inc. | 164,301 |
6,027 | Donnelley (R.R.) & Sons Co. | 75,398 |
10,161 | Dover Corp. | 636,688 |
1,592 | Dun & Bradstreet Corp. | 123,826 |
12,751 | Eaton Corp. | 614,343 |
24,902 | Emerson Electric Co. | 1,308,351 |
5,025 | Equifax, Inc. | 230,246 |
3,728 | Exelis, Inc. | 42,984 |
20,537 | Expeditors International Washington, Inc. | 821,480 |
10,014 | Fastenal Co. | 468,855 |
12,564 | FedEx Corp. | 1,108,647 |
1,850 | Flowserve Corp. | 212,621 |
5,733 | Fluor Corp. | 331,081 |
14,402 | 2 | Fortune Brands Home & Security, Inc. | 327,501 |
2,034 | Gardner Denver, Inc. | 132,495 |
22,610 | General Dynamics Corp. | 1,526,175 |
439,433 | General Electric Co. | 8,604,098 |
8,619 | Goodrich (B.F.) Co. | 1,081,340 |
5,660 | 2 | GrafTech International Ltd. | 66,448 |
2,169 | Grainger (W.W.), Inc. | 450,762 |
27,492 | Honeywell International, Inc. | 1,667,665 |
462 | Hubbell, Inc., Class B | 37,071 |
17,434 | Illinois Tool Works, Inc. | 1,000,363 |
10,086 | Ingersoll-Rand PLC, Class A | 428,857 |
5,727 | Iron Mountain, Inc. | 173,929 |
4,407 | 2 | Jacobs Engineering Group, Inc. | 193,159 |
4,215 | Joy Global, Inc. | 298,296 |
2,800 | 2 | KAR Auction Services, Inc. | 51,520 |
4,752 | L-3 Communications Holdings, Inc. | 349,462 |
9,040 | Lockheed Martin Corp. | 818,482 |
2,450 | MSC Industrial Direct Co. | 180,590 |
584 | Manpower, Inc. | 24,878 |
12,130 | Masco Corp. | 159,873 |
Shares | Value |
11,195 | Norfolk Southern Corp. | 816,451 |
19,160 | Northrop Grumman Corp. | 1,212,445 |
13,331 | PACCAR, Inc. | 572,700 |
3,876 | Pall Corp. | 231,048 |
8,918 | Parker-Hannifin Corp. | 782,019 |
6,724 | Pitney Bowes, Inc. | 115,182 |
4,923 | Precision Castparts Corp. | 868,270 |
7,188 | 2 | Quanta Services, Inc. | 158,999 |
16,915 | Raytheon Co. | 915,778 |
10,660 | Republic Services, Inc. | 291,764 |
4,825 | Robert Half International, Inc. | 143,785 |
4,817 | Rockwell Automation, Inc. | 372,547 |
5,040 | Rockwell Collins, Inc. | 281,686 |
897 | Rollins, Inc. | 19,061 |
3,267 | Roper Industries, Inc. | 332,907 |
1,724 | Ryder System, Inc. | 83,993 |
2,012 | Snap-On, Inc. | 125,830 |
32,873 | Southwest Airlines Co. | 272,188 |
5,751 | Stanley Black & Decker, Inc. | 420,743 |
2,868 | 2 | Stericycle, Inc. | 248,369 |
9,565 | Textron, Inc. | 254,812 |
691 | Timken Co. | 39,048 |
15,631 | Tyco International Ltd. | 877,368 |
21,273 | Union Pacific Corp. | 2,391,936 |
34,012 | United Parcel Service, Inc. | 2,657,698 |
37,608 | United Technologies Corp. | 3,070,317 |
1,203 | 2 | Verisk Analytics, Inc. | 58,887 |
641 | 2 | WABCO Holdings, Inc. | 40,402 |
585 | 2 | WESCO International, Inc. | 38,838 |
1,036 | Wabtec Corp. | 80,580 |
5,050 | Waste Connections, Inc. | 162,762 |
15,647 | Waste Management, Inc. | 535,127 |
19,351 | Xylem, Inc. | 539,506 |
TOTAL | 56,139,369 |
Information Technology – 19.6% |
27,524 | Accenture PLC | 1,787,684 |
18,846 | 2 | Adobe Systems, Inc. | 632,472 |
19,800 | 2 | Advanced Micro Devices, Inc. | 145,728 |
Shares | Value |
6,033 | 2 | Akamai Technologies, Inc. | 196,676 |
13,776 | Altera Corp. | 490,012 |
729 | 2 | Amdocs Ltd. | 23,328 |
5,541 | Amphenol Corp., Class A | 322,154 |
11,128 | Analog Devices, Inc. | 433,769 |
40,470 | Apple, Inc. | 23,644,193 |
48,994 | Applied Materials, Inc. | 587,438 |
13,463 | 2 | Autodesk, Inc. | 530,038 |
16,635 | Automatic Data Processing, Inc. | 925,239 |
4,423 | Avago Technologies Ltd. | 152,505 |
6,846 | 2 | BMC Software, Inc. | 282,466 |
21,477 | 2 | Broadcom Corp. | 786,058 |
2,277 | Broadridge Financial Solutions | 52,849 |
12,377 | CA, Inc. | 327,000 |
255,466 | 4 | Cisco Systems, Inc. | 5,147,640 |
7,805 | 2 | Citrix Systems, Inc. | 668,186 |
11,677 | 2 | Cognizant Technology Solutions Corp. | 856,158 |
5,246 | Computer Sciences Corp. | 147,203 |
1,688 | 2 | CoreLogic, Inc. | 28,190 |
76,127 | Corning, Inc. | 1,092,422 |
51,781 | 2 | Dell, Inc. | 847,655 |
1,108 | 2 | Dolby Laboratories, Class A | 43,467 |
69,609 | 2 | EMC Corp. | 1,963,670 |
38,834 | 2 | eBay, Inc. | 1,594,136 |
11,103 | 2 | Electronic Arts, Inc. | 170,764 |
5,296 | FLIR Systems, Inc. | 118,948 |
2,842 | 2 | F5 Networks, Inc. | 380,629 |
7,938 | Fidelity National Information Services, Inc. | 267,273 |
2,054 | 2 | First Solar, Inc. | 37,794 |
4,701 | 2 | Fiserv, Inc. | 330,433 |
1,282 | 2 | Fusion-io, Inc. | 32,883 |
1,351 | Global Payments, Inc. | 62,727 |
11,651 | 2 | Google, Inc. | 7,051,535 |
3,836 | Harris Corp. | 174,691 |
69,133 | Hewlett-Packard Co. | 1,711,733 |
10,959 | IAC Interactive Corp. | 527,676 |
46,747 | IBM Corp. | 9,680,369 |
215,541 | Intel Corp. | 6,121,364 |
Shares | Value |
11,201 | Intuit, Inc. | 649,322 |
7,721 | 2 | JDS Uniphase Corp. | 93,810 |
6,221 | Jabil Circuit, Inc. | 145,882 |
17,850 | 2 | Juniper Networks, Inc. | 382,526 |
5,638 | KLA-Tencor Corp. | 294,022 |
23,966 | 2 | LSI Logic Corp. | 192,687 |
2,389 | Lexmark International Group, Class A | 71,909 |
9,037 | Linear Technology Corp. | 295,600 |
400 | 2 | LinkedIn Corp. | 43,380 |
5,744 | Mastercard, Inc. | 2,597,839 |
6,572 | Microchip Technology, Inc. | 232,255 |
33,350 | 2 | Micron Technology, Inc. | 219,777 |
329,058 | Microsoft Corp. | 10,536,437 |
4,623 | Molex, Inc. | 127,549 |
12,271 | 2 | Motorola Mobility Holdings, Inc. | 476,360 |
9,979 | Motorola, Inc. | 509,228 |
25,756 | 2 | NVIDIA Corp. | 334,828 |
12,310 | 2 | NetApp, Inc. | 477,997 |
2,447 | 2 | Novellus Systems, Inc. | 114,397 |
164,105 | Oracle Corp. | 4,823,046 |
10,933 | Paychex, Inc. | 338,704 |
5,021 | 2 | Polycom, Inc. | 66,629 |
71,044 | Qualcomm, Inc. | 4,535,449 |
863 | 2 | Quest Software, Inc. | 20,082 |
6,535 | 2 | Red Hat, Inc. | 389,551 |
11,465 | SAIC, Inc. | 139,414 |
4,612 | 2 | Salesforce.com, Inc. | 718,227 |
9,422 | 2 | Sandisk Corp. | 348,708 |
1,147 | Solera Holdings, Inc. | 51,546 |
24,740 | 2 | Symantec Corp. | 408,705 |
16,554 | TE Connectivity Ltd. | 603,559 |
5,818 | 2 | Teradata Corp. | 405,980 |
6,202 | 2 | Teradyne, Inc. | 106,736 |
41,997 | Texas Instruments, Inc. | 1,341,384 |
23,674 | Total System Services, Inc. | 556,813 |
5,665 | 2 | Verisign, Inc. | 232,888 |
23,614 | Visa, Inc., Class A | 2,904,050 |
7,920 | 2 | Western Digital Corp. | 307,375 |
Shares | Value |
21,011 | Western Union Co. | 386,182 |
45,177 | Xerox Corp. | 351,477 |
9,008 | Xilinx, Inc. | 327,711 |
41,161 | 2 | Yahoo, Inc. | 639,642 |
TOTAL | 108,176,818 |
Materials – 3.3% |
7,832 | Air Products & Chemicals, Inc. | 669,558 |
2,350 | Airgas, Inc. | 215,354 |
793 | Albemarle Corp. | 51,783 |
44,902 | Alcoa, Inc. | 436,897 |
3,627 | Allegheny Technologies, Inc. | 155,743 |
5,263 | Ball Corp. | 219,783 |
3,465 | Bemis Co., Inc. | 112,231 |
2,736 | CF Industries Holdings, Inc. | 528,212 |
4,817 | Cliffs Natural Resources, Inc. | 299,906 |
2,495 | 2 | Crown Holdings, Inc. | 92,265 |
430 | Domtar Corp. | 37,616 |
46,244 | Dow Chemical Co. | 1,566,747 |
31,608 | Du Pont (E.I.) de Nemours & Co. | 1,689,764 |
4,634 | Eastman Chemical Co. | 250,097 |
9,878 | Ecolab, Inc. | 629,130 |
2,370 | FMC Corp. | 261,767 |
51,140 | Freeport-McMoran Copper & Gold, Inc. | 1,958,662 |
2,749 | International Flavors & Fragrances, Inc. | 165,517 |
27,464 | International Paper Co. | 914,826 |
10,577 | LyondellBasell Industries NV | 441,907 |
5,860 | MeadWestvaco Corp. | 186,465 |
114 | Minerals Technologies, Inc. | 7,649 |
28,320 | Monsanto Co. | 2,157,418 |
11,699 | Mosaic Co./The | 617,941 |
16,787 | Newmont Mining Corp. | 799,901 |
12,697 | Nucor Corp. | 497,849 |
5,509 | 2 | Owens-Illinois, Inc. | 128,084 |
7,088 | PPG Industries, Inc. | 745,941 |
10,118 | Praxair, Inc. | 1,170,653 |
1,595 | Rock-Tenn Co. | 99,416 |
7,736 | Sealed Air Corp. | 148,377 |
3,472 | Sensient Technologies Corp. | 128,985 |
Shares | Value |
2,915 | Sherwin-Williams Co. | 350,616 |
4,073 | Sigma-Aldrich Corp. | 288,776 |
8,127 | 2 | SunCoke Energy, Inc. | 123,693 |
2,774 | Titanium Metals Corp. | 40,972 |
4,862 | United States Steel Corp. | 137,740 |
4,331 | Vulcan Materials Co. | 185,410 |
TOTAL | 18,513,651 |
Telecommunication Services – 2.8% |
246,138 | AT&T, Inc. | 8,100,401 |
28,944 | CenturyLink, Inc. | 1,116,081 |
8,491 | 2 | Crown Castle International Corp. | 480,675 |
33,927 | Frontier Communications Corp. | 137,065 |
12,499 | 2 | MetroPCS Communications, Inc. | 91,243 |
101,259 | 2 | Sprint Nextel Corp. | 251,122 |
1,245 | Telephone and Data System, Inc. | 30,241 |
131,641 | Verizon Communications, Inc. | 5,315,664 |
20,040 | Windstream Corp. | 225,250 |
TOTAL | 15,747,742 |
Utilities – 3.3% |
21,787 | 2 | AES Corp. | 272,773 |
5,388 | AGL Resources, Inc. | 212,449 |
22,274 | Ameren Corp. | 730,364 |
18,594 | American Electric Power Co., Inc. | 722,191 |
3,687 | American Water Works Co., Inc. | 126,243 |
8,669 | CMS Energy Corp. | 199,300 |
14,388 | CenterPoint Energy, Inc. | 290,782 |
11,233 | Consolidated Edison Co. | 667,802 |
5,828 | DTE Energy Co. | 328,583 |
19,332 | Dominion Resources, Inc. | 1,008,937 |
45,343 | Duke Energy Corp. | 971,701 |
24,822 | Edison International | 1,092,416 |
15,574 | Entergy Corp. | 1,021,031 |
35,201 | Exelon Corp. | 1,373,191 |
14,442 | FirstEnergy Corp. | 676,174 |
2,838 | Integrys Energy Group, Inc. | 155,068 |
7,817 | 2 | NRG Energy, Inc. | 132,889 |
14,113 | NextEra Energy, Inc. | 908,172 |
9,667 | NiSource, Inc. | 238,292 |
Shares | Value |
10,549 | Northeast Utilities Co. | 387,887 |
7,001 | ONEOK, Inc. | 601,316 |
14,204 | P G & E Corp. | 627,533 |
19,644 | PPL Corp. | 537,263 |
26,409 | Pepco Holdings, Inc. | 499,658 |
3,743 | Pinnacle West Capital Corp. | 180,974 |
10,012 | Progress Energy, Inc. | 532,839 |
19,263 | Public Service Enterprises Group, Inc. | 600,042 |
3,953 | SCANA Corp. | 182,312 |
8,160 | Sempra Energy | 528,278 |
29,382 | Southern Co. | 1,349,809 |
7,308 | TECO Energy, Inc. | 131,690 |
7,809 | Wisconsin Energy Corp. | 287,684 |
16,512 | Xcel Energy, Inc. | 446,815 |
TOTAL | 18,022,458 |
TOTAL COMMON STOCKS (IDENTIFIED COST $212,830,571) | 535,062,084 |
EXCHANGE-TRADED FUND – 0.3% |
13,064 | SPDR S&P 500 ETF Trust (IDENTIFIED COST $1,516,978) | 1,825,955 |
WARRANT – 0.0% |
Consumer Discretionary – 0.0% |
30,369 | 2 | Ford Motor Co., Del., Warrants, Expiration Date 1/1/2013 (IDENTIFIED COST $151,845) | 74,100 |
MUTUAL FUND – 3.0% |
16,234,780 | 3,5 | Federated Prime Value Obligations Fund, Institutional Shares, 0.20% (AT NET ASSET VALUE) | 16,234,780 |
TOTAL INVESTMENTS — 100.0% (IDENTIFIED COST $230,734,174)6 | 553,196,919 |
OTHER ASSETS AND LIABILITIES - NET — 0.0%7 | 6,512 |
TOTAL NET ASSETS — 100% | $553,203,431 |
SECURITIES SOLD SHORT
Shares | Value |
1,933 | Acco Brands Corp. (PROCEEDS $20,279) | $20,393 |
Semi-Annual Shareholder Report
At April 30, 2012, the Fund had the following outstanding futures contracts:1Description | Number of Contracts | Notional Value | Expiration Date | Unrealized Appreciation |
2 S&P 500 E-Mini Index Long Futures | 138 | $9,615,840 | June 2012 | $199,915 |
2 S&P 500 Index Long Futures | 21 | $7,316,400 | June 2012 | $286,721 |
UNREALIZED APPRECIATION ON FUTURES CONTRACTS | $486,636 |
Net Unrealized Appreciation on Futures Contracts and Value of Securities Sold Short is included in “Other Assets and Liabilities — Net.”
1 | The Fund purchases index futures contracts to efficiently manage cash flows resulting from shareholder purchases and redemptions, dividend and capital gain payments to shareholders and corporate actions while maintaining exposure to the S&P 500 Index and minimizing trading costs. The underlying face amount, at value, of open index futures contracts is $16,932,240 at April 30, 2012, which represents 3.1% of total net assets. Taking into consideration these open index futures contracts, the Fund's effective total exposure to the S&P 500 Index is 99.8%. |
2 | Non-income producing security. |
3 | Affiliated holdings. |
4 | Pledged as collateral to ensure the Fund is able to satisfy the obligations of its outstanding futures contracts. |
5 | 7-Day net yield. |
6 | Also represents cost for federal tax purposes. |
7 | Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. |
Note: The categories of investments are shown as a percentage of total net assets at April 30, 2012.
Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in the three broad levels listed below:
Level 1 — quoted prices in active markets for identical securities, including investment companies with daily net asset values, if applicable.
Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). Also includes securities valued at amortized cost.
Level 3 — significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
As of April 30, 2012, all investments of the Fund utilized Level 1 inputs in valuing the Fund's assets carried at fair value.
The following acronyms are used throughout this portfolio:
ADR | — American Depositary Receipt |
REIT | — Real Estate Investment Trust |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportFinancial Highlights – Class C Shares
(For a Share Outstanding Throughout Each Period)
Six Months Ended (unaudited) 4/30/2012 | Year Ended October 31, | ||||
2011 | 2010 | 2009 | 2008 | 2007 | |
Net Asset Value, Beginning of Period | $12.83 | $12.69 | $11.65 | $15.53 | $28.32 | $27.23 |
Income From Investment Operations: | |||||
Net investment income | 0.05 | 0.081 | 0.071 | 0.121 | 0.171 | 0.15 |
Net realized and unrealized gain (loss) on investments, futures contracts, short sales and foreign currency transactions | 1.44 | 0.77 | 1.64 | 0.51 | (9.60) | 3.10 |
TOTAL FROM INVESTMENT OPERATIONS | 1.49 | 0.85 | 1.71 | 0.63 | (9.43) | 3.25 |
Less Distributions: | |||||
Distributions from net investment income | (0.04) | (0.08) | (0.08) | (0.13) | (0.17) | (0.16) |
Distributions from net realized gain on investments, futures contracts and foreign currency transactions | (0.26) | (0.63) | (0.59) | (4.38) | (3.21) | (2.00) |
TOTAL DISTRIBUTIONS | (0.30) | (0.71) | (0.67) | (4.51) | (3.38) | (2.16) |
Regulatory Settlement Proceeds | — | — | — | — | 0.022 | — |
Net Asset Value, End of Period | $14.02 | $12.83 | $12.69 | $11.65 | $15.53 | $28.32 |
Total Return3 | 11.85% | 6.87% | 15.11% | 8.55% | (36.87)%2 | 12.91% |
Ratios to Average Net Assets: | |||||
Net expenses | 1.43%4 | 1.43% | 1.43% | 1.43% | 1.41% | 1.40% |
Net investment income | 0.73%4 | 0.59% | 0.58% | 1.14% | 0.78% | 0.59% |
Expense waiver/reimbursement5 | 0.07%4 | 0.06% | 0.07% | 0.09% | 0.05% | 0.02% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $32,053 | $29,402 | $31,722 | $32,489 | $35,288 | $75,531 |
Portfolio turnover | 19% | 53% | 34% | 31% | 47% | 49% |
Semi-Annual Shareholder Report
1 | Per share numbers have been calculated using the average shares method. |
2 | During the year, the Fund received a regulatory settlement from an unaffiliated third party, which had an impact of 0.08% on the total return. |
3 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. Total returns for periods of less than one year are not annualized. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportFinancial Highlights – Class R Shares
(For a Share Outstanding Throughout Each Period)
Six Months Ended (unaudited) 4/30/2012 | Year Ended October 31, | ||||
2011 | 2010 | 2009 | 2008 | 2007 | |
Net Asset Value, Beginning of Period | $12.90 | $12.76 | $11.71 | $15.58 | $28.41 | $27.30 |
Income From Investment Operations: | |||||
Net investment income | 0.07 | 0.121 | 0.111 | 0.151 | 0.241 | 0.23 |
Net realized and unrealized gain (loss) on investments, futures contracts, short sales and foreign currency transactions | 1.46 | 0.77 | 1.65 | 0.53 | (9.65) | 3.13 |
TOTAL FROM INVESTMENT OPERATIONS | 1.53 | 0.89 | 1.76 | 0.68 | (9.41) | 3.36 |
Less Distributions: | |||||
Distributions from net investment income | (0.07) | (0.12) | (0.12) | (0.17) | (0.23) | (0.25) |
Distributions from net realized gain on investments, futures contracts and foreign currency transactions | (0.26) | (0.63) | (0.59) | (4.38) | (3.21) | (2.00) |
TOTAL DISTRIBUTIONS | (0.33) | (0.75) | (0.71) | (4.55) | (3.44) | (2.25) |
Regulatory Settlement Proceeds | — | — | — | — | 0.022 | — |
Net Asset Value, End of Period | $14.10 | $12.90 | $12.76 | $11.71 | $15.58 | $28.41 |
Total Return3 | 12.04% | 7.18% | 15.51% | 8.94% | (36.72)%2 | 13.29% |
Ratios to Average Net Assets: | |||||
Net expenses | 1.10%4 | 1.10% | 1.10% | 1.10% | 1.10% | 1.10% |
Net investment income | 1.05%4 | 0.91% | 0.91% | 1.42% | 1.11% | 0.88% |
Expense waiver/reimbursement5 | 0.07%4 | 0.06% | 0.06% | 0.09% | 0.05% | 0.02% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $38,243 | $32,474 | $30,980 | $25,796 | $21,739 | $73,702 |
Portfolio turnover | 19% | 53% | 34% | 31% | 47% | 49% |
Semi-Annual Shareholder Report
1 | Per share numbers have been calculated using the average shares method. |
2 | During the year, the Fund received a regulatory settlement from an unaffiliated third party, which had an impact of 0.08% on the total return. |
3 | Based on net asset value. Total returns for periods of less than one year are not annualized. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportFinancial Highlights – Institutional Shares
(For a Share Outstanding Throughout Each Period)
Six Months Ended (unaudited) 4/30/2012 | Year Ended October 31, | ||||
2011 | 2010 | 2009 | 2008 | 2007 | |
Net Asset Value, Beginning of Period | $12.96 | $12.82 | $11.76 | $15.62 | $28.48 | $27.36 |
Income From Investment Operations: | |||||
Net investment income | 0.13 | 0.221 | 0.201 | 0.241 | 0.401 | 0.45 |
Net realized and unrealized gain (loss) on investments, futures contracts, short sales and foreign currency transactions | 1.45 | 0.77 | 1.66 | 0.53 | (9.67) | 3.12 |
TOTAL FROM INVESTMENT OPERATIONS | 1.58 | 0.99 | 1.86 | 0.77 | (9.27) | 3.57 |
Less Distributions: | |||||
Distributions from net investment income | (0.11) | (0.22) | (0.21) | (0.25) | (0.40) | (0.45) |
Distributions from net realized gain on investments, futures contracts and foreign currency transactions | (0.26) | (0.63) | (0.59) | (4.38) | (3.21) | (2.00) |
TOTAL DISTRIBUTIONS | (0.37) | (0.85) | (0.80) | (4.63) | (3.61) | (2.45) |
Regulatory Settlement Proceeds | — | — | — | — | 0.022 | — |
Net Asset Value, End of Period | $14.17 | $12.96 | $12.82 | $11.76 | $15.62 | $28.48 |
Total Return3 | 12.47% | 7.96% | 16.38% | 9.78% | (36.23)%2 | 14.13% |
Ratios to Average Net Assets: | |||||
Net expenses | 0.35%4 | 0.35% | 0.35% | 0.35% | 0.35% | 0.35% |
Net investment income | 1.82%4 | 1.67% | 1.65% | 2.24% | 1.84% | 1.63% |
Expense waiver/reimbursement5 | 0.08%4 | 0.09% | 0.09% | 0.10% | 0.07% | 0.03% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $193,198 | $187,164 | $208,399 | $170,766 | $215,731 | $651,327 |
Portfolio turnover | 19% | 53% | 34% | 31% | 47% | 49% |
Semi-Annual Shareholder Report
1 | Per share numbers have been calculated using the average shares method. |
2 | During the year, the Fund received a regulatory settlement from an unaffiliated third party, which had an impact of 0.08% on the total return. |
3 | Based on net asset value. Total returns for periods of less than one year are not annualized |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportFinancial Highlights – Service Shares
(For a Share Outstanding Throughout Each Period)
Six Months Ended (unaudited) 4/30/2012 | Year Ended October 31, | ||||
2011 | 2010 | 2009 | 2008 | 2007 | |
Net Asset Value, Beginning of Period | $12.90 | $12.77 | $11.71 | $15.58 | $28.41 | $27.30 |
Income From Investment Operations: | |||||
Net investment income | 0.10 | 0.181 | 0.161 | 0.201 | 0.331 | 0.35 |
Net realized and unrealized gain (loss) on investments, futures contracts, short sales and foreign currency transactions | 1.45 | 0.76 | 1.66 | 0.52 | (9.64) | 3.12 |
TOTAL FROM INVESTMENT OPERATIONS | 1.55 | 0.94 | 1.82 | 0.72 | (9.31) | 3.47 |
Less Distributions: | |||||
Distributions from net investment income | (0.09) | (0.18) | (0.17) | (0.21) | (0.33) | (0.36) |
Distributions from net realized gain on investments, futures contracts and foreign currency transactions | (0.26) | (0.63) | (0.59) | (4.38) | (3.21) | (2.00) |
TOTAL DISTRIBUTIONS | (0.35) | (0.81) | (0.76) | (4.59) | (3.54) | (2.36) |
Regulatory Settlement Proceeds | — | — | — | — | 0.022 | — |
Net Asset Value, End of Period | $14.10 | $12.90 | $12.77 | $11.71 | $15.58 | $28.41 |
Total Return3 | 12.28% | 7.59% | 16.10% | 9.42% | (36.41)%2 | 13.78% |
Ratios to Average Net Assets: | |||||
Net expenses | 0.65%4 | 0.65% | 0.65% | 0.65% | 0.65% | 0.65% |
Net investment income | 1.52%4 | 1.35% | 1.36% | 1.90% | 1.54% | 1.33% |
Expense waiver/reimbursement5 | 0.40%4 | 0.38% | 0.38% | 0.41% | 0.32% | 0.29% |
Supplemental Data: | |||||
Net assets, end of period (000 omitted) | $289,710 | $287,432 | $231,807 | $227,316 | $235,167 | $490,722 |
Portfolio turnover | 19% | 53% | 34% | 31% | 47% | 49% |
Semi-Annual Shareholder Report
1 | Per share numbers have been calculated using the average shares method. |
2 | During the year, the Fund received a regulatory settlement from an unaffiliated third party, which had an impact of 0.08% on the total return. |
3 | Based on net asset value. Total returns for periods of less than one year are not annualized. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportStatement of Assets and Liabilities
Assets: |
Total investment in securities, at value including $16,303,206 of investment in affiliated holdings (Note 5) (identified cost $230,734,174) | $553,196,919 |
Restricted cash (Note 2) | 408,000 |
Income receivable | 544,445 |
Receivable for investments sold | 64,827 |
Receivable for shares sold | 353,151 |
TOTAL ASSETS | 554,567,342 |
Liabilities: |
Securities sold short, at value (proceeds $20,279) | $20,393 |
Payable for shares redeemed | 1,014,559 |
Payable for daily variation margin | 58,702 |
Payable for transfer and dividend disbursing agent fees and expenses | 122,437 |
Payable for Directors'/Trustees' fees | 926 |
Payable for distribution services fee (Note 5) | 46,981 |
Payable for shareholder services fee (Note 5) | 69,304 |
Accrued expenses | 30,609 |
TOTAL LIABILITIES | 1,363,911 |
Net assets for 39,184,032 shares outstanding | $553,203,431 |
Net Assets Consist of: |
Paid-in capital | $225,787,463 |
Net unrealized appreciation of investments, futures contracts, short sales and translation of assets and liabilities in foreign currency | 322,949,265 |
Accumulated net realized gain on investments, futures contracts and foreign currency transactions | 4,070,167 |
Undistributed net investment income | 396,536 |
TOTAL NET ASSETS | $553,203,431 |
Net Asset Value, Offering Price and Redemption Proceeds Per Share |
Class C Shares: |
Net asset value per share ($32,052,635 ÷ 2,286,985 shares outstanding), no par value, unlimited shares authorized | $14.02 |
Offering price per share | $14.02 |
Redemption proceeds per share (99.00/100 of $14.02) | $13.88 |
Class R Shares: |
Net asset value per share ($38,242,577 ÷ 2,712,482 shares outstanding), no par value, unlimited shares authorized | $14.10 |
Institutional Shares: |
Net asset value per share ($193,198,429 ÷ 13,637,062 shares outstanding), no par value, unlimited shares authorized | $14.17 |
Service Shares: |
Net asset value per share ($289,709,790 ÷ 20,547,503 shares outstanding), no par value, unlimited shares authorized | $14.10 |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportSix Months Ended April 30, 2012 (unaudited)
Investment Income: |
Dividends (including $14,580 received from affiliated holdings (Note 5)) | $5,795,952 |
Interest | 581 |
TOTAL INCOME | 5,796,533 |
Expenses: |
Management fee (Note 5) | $801,399 |
Custodian fees | 61,501 |
Transfer and dividend disbursing agent fees and expenses (Note 2) | 277,591 |
Directors'/Trustees' fees | 4,352 |
Auditing fees | 11,635 |
Legal fees | 6,170 |
Portfolio accounting fees | 67,220 |
Distribution services fee (Note 5) | 624,103 |
Shareholder services fee (Note 5) | 379,404 |
Account administration fee (Note 2) | 9,603 |
Share registration costs | 32,050 |
Printing and postage | 38,671 |
Insurance premiums | 2,431 |
Miscellaneous | 9,372 |
TOTAL EXPENSES | 2,325,502 |
Waivers and Reimursements: |
Waiver/reimbursement of management fee (Note 5) | $(178,586) |
Waiver of distribution services fee (Note 5) | (351,534) |
Reimbursement of transfer and dividend disbursing agent fees and expenses (Note 2) and (Note 5) | (130,573) |
TOTAL WAIVERS AND REIMBURSEMENTS | (660,693) |
Net expenses | 1,664,809 |
Net investment income | $4,131,724 |
Realized and Unrealized Gain (Loss) on Investments, Futures Contracts, Short Sales and Foreign Currency Transactions: |
Net realized gain on investments and foreign currency transactions (including realized loss of $4,566 on sales of investments in an affiliated holding (Note5)) | $23,770,238 |
Net realized gain on futures contracts | 1,656,060 |
Net change in unrealized appreciation of investments and translation of assets and liabilities in foreign currency | 33,016,662 |
Net change in unrealized appreciation of futures contracts | (258,664) |
Net change in unrealized depreciation of short sales | (86) |
Net realized and unrealized gain on investments, futures contracts, short sales and foreign currency transactions | $58,184,210 |
Change in net assets resulting from operations | $62,315,934 |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder ReportStatement of Changes in Net Assets
Six Months Ended (unaudited) 4/30/2012 | Year Ended 10/31/2011 |
Increase (Decrease) in Net Assets |
Operations: |
Net investment income | $4,131,724 | $8,068,087 |
Net realized gain on investments, futures contracts and foreign currency transactions | 25,426,298 | 9,330,752 |
Net change in unrealized appreciation/depreciation of investments, futures contracts, short sales and translation of assets and liabilities in foreign currency | 32,757,912 | 22,496,385 |
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | 62,315,934 | 39,895,224 |
Distributions to Shareholders: |
Distributions from net investment income |
Class C Shares | (99,423) | (181,556) |
Class R Shares | (165,885) | (292,986) |
Institutional Shares | (1,596,001) | (3,350,130) |
Service Shares | (1,985,326) | (4,223,910) |
Distributions from net realized gain on investments, futures contracts and foreign currency transactions |
Class C Shares | (579,699) | (1,568,488) |
Class R Shares | (643,359) | (1,527,804) |
Institutional Shares | (3,683,839) | (10,066,143) |
Service Shares | (5,495,672) | (14,732,888) |
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS | (14,249,204) | (35,943,905) |
Share Transactions: |
Proceeds from sale of shares | 57,014,830 | 211,309,478 |
Net asset value of shares issued to shareholders in payment of distributions declared | 12,012,327 | 30,506,415 |
Cost of shares redeemed | (100,362,584) | (212,203,594) |
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS | (31,335,427) | 29,612,299 |
Change in net assets | 16,731,303 | 33,563,618 |
Net Assets: |
Beginning of period | 536,472,128 | 502,908,510 |
End of period (including undistributed net investment income of $396,536 and $111,447, respectively) | $553,203,431 | $536,472,128 |
See Notes which are an integral part of the Financial Statements
Semi-Annual Shareholder Report1. ORGANIZATION
Federated Index Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “Act”), as an open-end management investment company. The Trust consists of two portfolios. The financial statements included herein are only those of Federated Max-Cap Index Fund (the “Fund”), a diversified portfolio. The financial statements of the other portfolios are presented separately. The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. Each portfolio pays its own expenses. The Fund offers four classes of shares: Class C Shares, Class R Shares, Institutional Shares and Service Shares. All shares of the Fund have equal rights with respect to voting, except on class-specific matters. The investment objective of the Fund is to provide investment results that generally correspond to the aggregate price and dividend performance of publicly traded common stocks comprising the Standard & Poor's 500 Index (S&P 500).
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with U.S. generally accepted accounting principles (GAAP).
Investment Valuation
In calculating its net asset value (NAV), the Fund generally values investments as follows:
- Equity securities listed on an exchange or traded through a regulated market system are valued at their last reported sale price or official closing price in their principal exchange or market.
- Shares of other mutual funds are valued based upon their reported NAVs.
- Derivative contracts listed on exchanges are valued at their reported settlement or closing price.
- Over-the-counter (OTC) derivative contracts are fair valued using price evaluations provided by a pricing service approved by the Fund's Board of Trustees (the “Trustees”).
- Fixed-income securities acquired with remaining maturities of 60 days or less are valued at their cost (adjusted for the accretion of any discount or amortization of any premium), which approximates market value.
- Fixed-income securities acquired with remaining maturities greater than 60 days are fair valued using price evaluations provided by a pricing service approved by the Trustees.
For securities that are fair valued in accordance with procedures established by and under the general supervision of the Trustees, certain factors may be considered such as: the purchase price of the security, information obtained by contacting the issuer, analysis of the issuer's financial statements or other available documents, fundamental analytical data, the nature and duration of restrictions on disposition, the movement of the market in which the security is normally traded and public trading in similar securities of the issuer or comparable issuers.
Semi-Annual Shareholder Report
If the Fund cannot obtain a price or price evaluation from a pricing service for an investment, the Fund may attempt to value the investment based upon the mean of bid and asked quotations or fair value the investment based on price evaluations, from one or more dealers. If any price, quotation, price evaluation or other pricing source is not readily available when the NAV is calculated, the Fund uses the fair value of the investment determined in accordance with the procedures described below. There can be no assurance that the Fund could purchase or sell an investment at the price used to calculate the Fund's NAV.Fair Valuation and Significant Events Procedures
The Trustees have authorized the use of pricing services to provide evaluations of the current fair value of certain investments for purposes of calculating the NAV. Factors considered by pricing services in evaluating an investment include the yields or prices of investments of comparable quality, coupon, maturity, call rights and other potential prepayments, terms and type, reported transactions, indications as to values from dealers and general market conditions. Some pricing services provide a single price evaluation reflecting the bid-side of the market for an investment (a “bid” evaluation). Other pricing services offer both bid evaluations and price evaluations indicative of a price between the prices bid and asked for the investment (a “mid” evaluation). The Fund normally uses bid evaluations for U.S. Treasury and Agency securities and mortgage-backed securities. The Fund normally uses mid evaluations for other types of fixed-income securities and OTC derivative contracts. In the event that market quotations and price evaluations are not available for an investment, the fair value of the investment is determined in accordance with procedures adopted by the Trustees.
The Trustees also have adopted procedures requiring an investment to be priced at its fair value whenever the Manager determines that a significant event affecting the value of the investment has occurred between the time as of which the price of the investment would otherwise be determined and the time as of which the NAV is computed. An event is considered significant if there is both an affirmative expectation that the investment's value will change in response to the event and a reasonable basis for quantifying the resulting change in value. Examples of significant events that may occur after the close of the principal market on which a security is traded, or after the time of a price evaluation provided by a pricing service or a dealer, include:
- With respect to securities traded in foreign markets, significant trends in U.S. equity markets or in the trading of foreign securities index futures or options contracts;
- With respect to price evaluations of fixed-income securities determined before the close of regular trading on the NYSE, actions by the Federal Reserve Open Market Committee and other significant trends in U.S. fixed-income markets;
- Political or other developments affecting the economy or markets in which an issuer conducts its operations or its securities are traded; and
- Announcements concerning matters such as acquisitions, recapitalizations, litigation developments, a natural disaster affecting the issuer's operations or regulatory changes or market developments affecting the issuer's industry.
Semi-Annual Shareholder Report
The Trustees have approved the use of a pricing service to determine the fair value of equity securities traded principally in foreign markets when the Manager determines that there has been a significant trend in the U.S. equity markets or in index futures trading. For other significant events, the Fund may seek to obtain more current quotations or price evaluations from alternative pricing sources. If a reliable alternative pricing source is not available, the Fund will determine the fair value of the investment using another method approved by the Trustees.Repurchase Agreements
The Fund may invest in repurchase agreements for short-term liquidity purposes. It is the policy of the Fund to require the other party to a repurchase agreement to transfer to the Fund's custodian or sub-custodian eligible securities or cash with a market value (after transaction costs) at least equal to the repurchase price to be paid under the repurchase agreement. The eligible securities are transferred to accounts with the custodian or sub-custodian in which the Fund holds a “securities entitlement” and exercises “control” as those terms are defined in the Uniform Commercial Code. The Fund has established procedures for monitoring the market value of the transferred securities and requiring the transfer of additional eligible securities if necessary to equal at least the repurchase price. These procedures also allow the other party to require securities to be transferred from the account to the extent that their market value exceeds the repurchase price or in exchange for other eligible securities of equivalent market value.
The insolvency of the other party or other failure to repurchase the securities may delay the disposition of the underlying securities or cause the Fund to receive less than the full repurchase price. Under the terms of the repurchase agreement, any amounts received by the Fund in excess of the repurchase price and related transaction costs must be remitted to the other party.
The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub-custodian for investment companies and other clients advised by the Fund's Manager and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities.
Semi-Annual Shareholder Report
Investment Income, Gains and Losses, Expenses and DistributionsInvestment transactions are accounted for on a trade-date basis. Realized gains and losses from investment transactions are recorded on an identified-cost basis. Interest income and expenses are accrued daily. Dividend income and distributions to shareholders are recorded on the ex-dividend date. Foreign dividends are recorded on the ex-dividend date or when the Fund is informed of the ex-dividend date. Distributions of net investment income are declared and paid quarterly. Non-cash dividends included in dividend income, if any, are recorded at fair value. Investment income, realized and unrealized gains and losses, and certain fund-level expenses are allocated to each class based on relative average daily net assets, except that Class C Shares, Class R Shares, Institutional Shares and Service Shares may bear distribution services fees, shareholder services fees, account administration fees and certain transfer and dividend disbursing agent fees unique to those classes. For the six months ended April 30, 2012, transfer and dividend disbursing agent fees and account administration fees for the Fund were as follows:
Transfer and Dividend Disbursing Agent Fees Incurred | Transfer and Dividend Disbursing Agent Fees Reimbursed | Account Administration Fees Incurred |
Class C Shares | $18,911 | $(852) | $1,786 |
Class R Shares | 48,171 | — | — |
Institutional Shares | 46,759 | (14,663) | — |
Service Shares | 163,750 | (115,058) | 7,817 |
TOTAL | $277,591 | $(130,573) | $9,603 |
Dividends are declared separately for each class. No class has preferential dividend rights; differences in per share dividend rates are generally due to differences in separate class expenses.
Premium and Discount Amortization
All premiums and discounts on fixed-income securities are amortized/accreted using the effective interest rate method.
Federal Taxes
It is the Fund's policy to comply with the Subchapter M provision of the Internal Revenue Code and to distribute to shareholders each year substantially all of its income. Accordingly, no provision for federal income tax is necessary. As of and during the six months ended April 30, 2012, the Fund did not have a liability for any uncertain tax positions. The Fund recognizes interest and penalties, if any, related to tax liabilities as income tax expense in the Statement of Operations. As of April 30, 2012, tax years 2008 through 2011 remain subject to examination by the Fund's major tax jurisdictions, which include the United States of America and the Commonwealth of Massachusetts.
The Fund may be subject to taxes imposed by governments of countries in which it invests. Such taxes are generally based on either income or gains earned or repatriated. The Fund accrues and applies such taxes to net investment income, net realized gains and net unrealized gains as income and/or gains are earned.
Semi-Annual Shareholder Report
When-Issued and Delayed Delivery TransactionsThe Fund may engage in when-issued or delayed delivery transactions. The Fund records when-issued securities on the trade date and maintains security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked to market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.
Futures Contracts
The Fund purchases stock index futures contracts to manage cash flows maintain exposure to the S&P 500 index and to potentially reduce transaction costs. Upon entering into a stock index futures contract with a broker, the Fund is required to deposit in a segregated account a specified amount of cash or U.S. government securities which is shown as Restricted Cash in the Statement of Assets and Liabilities. Futures contracts are valued daily and unrealized gains or losses are recorded in a “variation margin” account. Daily, the Fund receives from or pays to the broker a specified amount of cash based upon changes in the variation margin account. When a contract is closed, the Fund recognizes a realized gain or loss. Futures contracts have market risks, including the risk that the change in the value of the contract may not correlate with the changes in the value of the underlying securities. There is minimal counterparty risk to the Fund since futures are exchange traded and the exchange's clearinghouse, as counterparty to all exchange traded futures, guarantees the futures against default.
Futures contracts outstanding at period end are listed after the Fund's Portfolio of Investments.
The average notional value of long futures contracts held by the Fund throughout the period was $14,603,684. This is based on amounts held as of each month-end throughout the fiscal period.
Short Sales
In a short sale, the Fund sells a security it does not own in anticipation of a decline in the fair market value of the security. When the Fund sells a security short, it must borrow the security in order to deliver it at the completion of the sale. A gain, limited to the price at which the Fund sold the security short, or a loss, unlimited in size, will be recognized upon the termination of the short sale.
The Fund has an obligation to replace the borrowed security (e.g., to purchase the security at a future date and deliver it to the lender of the security). While the security is borrowed, the proceeds from the sale are deposited with the lender (“Prime Broker”). The Fund may incur two types of expenses from short sales: borrowing expenses and dividend expenses. Borrowing expenses may occur because the Fund may be obligated to pay fees to the Prime Broker on borrowed securities. This fee is normally based upon the market value of the borrowed security and is dependent upon the availability of the security. Dividend expenses may occur because the Fund has to pay the Prime Broker the equivalent of any dividends earned on the borrowed security.
Semi-Annual Shareholder Report
Additional Disclosure Related to Derivative InstrumentsFair Value of Derivative Instruments | ||
Liability | ||
Statement of Assets and Liabilities Location | Fair Value | |
Derivatives not accounted for as hedging instruments under ASC Topic 815 | ||
Equity contracts | Payable for daily variation margin | $486,636* |
* | Includes cumulative appreciation/depreciation 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. |
The Effect of Derivative Instruments on the Statement of Operations for the Six Months Ended April 30, 2012
Amount of Realized Gain or (Loss) on Derivatives Recognized in Income | |
Futures | |
Equity contracts | $1,656,060 |
Change in Unrealized Appreciation or (Depreciation) on Derivatives Recognized in Income | |
Futures | |
Equity contracts | $(258,664) |
Other
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets, liabilities, expenses and revenues reported in the financial statements. Actual results could differ from those estimated.
3. SHARES OF BENEFICIAL INTEREST
The following tables summarize share activity:
Six Months Ended 4/30/2012 | Year Ended 10/31/2011 | ||
Class C Shares: | Shares | Amount | Shares | Amount |
Shares sold | 291,460 | $3,872,433 | 466,284 | $6,072,723 |
Shares issued to shareholders in payment of distributions declared | 48,128 | 613,807 | 125,049 | 1,565,659 |
Shares redeemed | (344,657) | (4,591,010) | (798,330) | (10,379,937) |
NET CHANGE RESULTING FROM CLASS C SHARE TRANSACTIONS | (5,069) | $(104,770) | (206,997) | $(2,741,555) |
Six Months Ended 4/30/2012 | Year Ended 10/31/2011 | ||
Class R Shares: | Shares | Amount | Shares | Amount |
Shares sold | 523,813 | $7,184,517 | 877,940 | $11,431,432 |
Shares issued to shareholders in payment of distributions declared | 62,646 | 806,198 | 143,764 | 1,813,392 |
Shares redeemed | (390,865) | (5,221,346) | (931,914) | (12,212,691) |
NET CHANGE RESULTING FROM CLASS R SHARE TRANSACTIONS | 195,594 | $2,769,369 | 89,790 | $ 1,032,133 |
Six Months Ended 4/30/2012 | Year Ended 10/31/2011 | ||
Institutional Shares: | Shares | Amount | Shares | Amount |
Shares sold | 1,581,864 | $21,173,576 | 3,004,742 | $39,864,781 |
Shares issued to shareholders in payment of distributions declared | 248,222 | 3,227,398 | 666,498 | 8,469,807 |
Shares redeemed | (2,632,489) | (34,970,999) | (5,487,083) | (72,420,662) |
NET CHANGE RESULTING FROM INSTITUTIONAL SHARE TRANSACTIONS | (802,403) | $(10,570,025) | (1,815,843) | $(24,086,074) |
Six Months Ended 4/30/2012 | Year Ended 10/31/2011 | ||
Service Shares: | Shares | Amount | Shares | Amount |
Shares sold | 1,850,236 | $24,784,304 | 11,603,379 | $ 153,940,542 |
Shares issued to shareholders in payment of distributions declared | 570,633 | 7,364,924 | 1,476,173 | 18,657,557 |
Shares redeemed | (4,151,618) | (55,579,229) | (8,959,464) | (117,190,304) |
NET CHANGE RESULTING FROM SERVICE SHARE TRANSACTIONS | (1,730,749) | $(23,430,001) | 4,120,088 | $ 55,407,795 |
NET CHANGE RESULTING FROM TOTAL FUND SHARE TRANSACTIONS | (2,342,627) | $(31,335,427) | 2,187,038 | $ 29,612,299 |
4. FEDERAL TAX INFORMATION
At April 30, 2012, the cost of investments for federal tax purposes was $230,734,174. The net unrealized appreciation of investments for federal tax purposes excluding any unrealized appreciation resulting from futures contracts was $322,462,745. This consists of net unrealized appreciation from investments for those securities having an excess of value over cost of $325,635,523 and net unrealized depreciation from investments for those securities having an excess of cost over value of $3,172,778.
Semi-Annual Shareholder Report
5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATESManagement Fee
Federated Equity Management Company of Pennsylvania is the Fund's manager (the “Manager”). The management agreement between the Fund and the Manager provides for an annual fee equal to 0.30% of the Fund's average daily net assets. Subject to the terms described in the Expense Limitation note, the Manager may voluntarily choose to waive any portion of its fee. For the six months ended April 30, 2012, the Manager voluntarily waived $171,570 of its fee. In addition, an affiliate of the Manager reimbursed $130,573 of transfer and dividend disbursing agent fees and expenses.
Distribution Services Fee
The Fund has adopted a Distribution Plan (the “Plan”) pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Fund will compensate Federated Securities Corp. (FSC), the principal distributor, from the daily net assets of the Fund's Class C Shares, Class R Shares and Service Shares to finance activities intended to result in the sale of these shares. The Plan provides that the Fund may incur distribution expenses at the following percentages of average daily net assets annually, to compensate FSC:
Share Class Name | Percentage of Average Daily Net Assets of Class |
Class C Shares | 0.75% |
Class R Shares | 0.50% |
Service Shares | 0.30% |
Subject to the terms described in the Expense Limitation note, FSC may voluntarily choose to waive any portion of its fee. For the six months ended April 30, 2012, distribution services fees for the Fund were as follows:
Distribution Services Fees Incurred | Distribution Services Fees Waived |
Class C Shares | $114,471 | $ — |
Class R Shares | 84,655 | — |
Service Shares | 424,977 | (351,534) |
TOTAL | $624,103 | $(351,534) |
When FSC receives fees, it may pay some or all of them to financial intermediaries whose customers purchase shares. For the six months ended April 30, 2012, FSC retained $120,444 of fees paid by the Fund.
Semi-Annual Shareholder Report
Sales ChargesFront-end sales charges and contingent deferred sales charges (CDSC) do not represent expenses of the Fund. They are deducted from the proceeds of sales of Fund shares prior to investment or from redemption proceeds prior to remittance, as applicable. For the six months ended April 30, 2012, FSC retained $2,104 of CDSC relating to redemptions of Class C Shares.
Shareholder Services Fee
The Fund may pay fees (“Service Fees”) up to 0.25% of the average daily net assets of the Fund's Class C Shares, Institutional Shares and Service Shares to financial intermediaries or to Federated Shareholder Services Company (FSSC) for providing services to shareholders and maintaining shareholder accounts. Subject to the terms described in the Expense Limitation note, FSSC may voluntarily reimburse the Fund for Service Fees. For the six months ended April 30, 2012, Service Fees for the Fund were as follows:
Service Fees Incurred |
Class C Shares | $35,687 |
Service Shares | 343,717 |
TOTAL | $379,404 |
For the six months ended April 30, 2012, FSSC did not receive any fees paid by the Fund. For the six months ended April 30, 2012, the Fund's Institutional Shares did not incur Service Fees.
Expense Limitation
The Manager and its affiliates (which may include FSC and FSSC) have voluntarily agreed to waive their fees and/or reimburse expenses so that the total annual fund operating expenses (as shown in the financial highlights) paid by the Fund's Class C Shares, Class R Shares, Institutional Shares and Service Shares (after the voluntary waivers and/or reimbursements) will not exceed 1.43%, 1.10%, 0.35% and 0.65% (the “Fee Limit”), respectively, up to but not including the later of (the “Termination Date”): (a) January 1, 2013; or (b) the date of the Fund's next effective Prospectus. While the Manager and its affiliates currently do not anticipate terminating or increasing these arrangements prior to the Termination Date, these arrangements may only be terminated or the Fee Limit increased prior to the Termination Date with the agreement of the Trustees.
General
Certain Officers and Trustees of the Fund are Officers and Directors or Trustees of the above companies.
Semi-Annual Shareholder Report
Transactions Involving Affiliated HoldingsAffiliated holdings are either: a) common shares of Federated Investors, Inc., the parent of the Manager; or b) mutual funds which are managed by the Manager or an affiliate of the Manager. The Manager has agreed to reimburse the Fund for certain management fees as a result of transactions in other affiliated mutual funds. For the six months ended April 30, 2012, the Manager reimbursed $7,016. Transactions involving the affiliated holdings during the six months ended April 30, 2012, were as follows:
Federated Investors, Inc. | Federated Prime Value Obligations Fund, Institutional Shares | Total of Affiliated Transactions |
Balance of Shares Held 10/31/2011 | 3,343 | 13,531,400 | 13,534,743 |
Purchases/Additions | 900 | 49,714,959 | 49,715,859 |
Sales/Reductions | 1,144 | 47,011,579 | 47,012,723 |
Balance of Shares Held 4/30/2012 | 3,099 | 16,234,780 | 16,237,879 |
Value | $68,426 | $16,234,780 | $16,303,206 |
Dividend Income | $1,797 | $12,783 | $14,580 |
6. Investment TRANSACTIONS
Purchases and sales of investments, excluding long-term U.S. government securities and short-term obligations, for the six months ended April 30, 2012, were as follows:
Purchases | $100,419,329 |
Sales | $141,600,697 |
7. INTERFUND LENDING
Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the Fund, along with other funds advised by subsidiaries of Federated Investors, Inc., may participate in an interfund lending program. This program provides an alternative credit facility allowing the Fund to borrow from other participating affiliated funds. As of April 30, 2012, there were no outstanding loans. During the six months ended April 30, 2012, the program was not utilized.
Semi-Annual Shareholder Report
8. recent accounting pronouncementsIn April 2011, the Financial Accounting Standards Board (FASB) released Accounting Standards Update (ASU) No. 2011-03, “Reconsideration of Effective Control for Repurchase Agreements.” This ASU amends FASB Accounting Standards Codification (ASC) Topic 860, “Transfers and Servicing”; specifically the criteria required to determine whether a repurchase agreement and similar agreements should be accounted for as sales of financial assets or secured borrowings with commitments. This ASU is effective for fiscal years and interim periods beginning after December 15, 2011. Management has concluded that the adoption of ASU No. 2011-03 is not expected to have a material impact on the Fund's financial statements and the accompanying notes, net assets or results of operations.
In addition, in May 2011, FASB released ASU No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” This ASU amends FASB ASC Topic 820, “Fair Value Measurement,” to establish common requirements for measuring fair value and for disclosing information about fair value measurements in accordance with GAAP. This ASU is effective for fiscal years and interim periods beginning after December 15, 2011. Management has concluded that the adoption of ASU No. 2011-04 is not expected to have a material impact on the Fund's financial statements and the accompanying notes.
Semi-Annual Shareholder ReportShareholder Expense Example (unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase or redemption payments; and (2) ongoing costs, including management fees and to the extent applicable, distribution (12b-1) fees and/or shareholder services fees and other Fund expenses. This Example is intended to help you to understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. It is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from November 1, 2011 to April 30, 2012.
ACTUAL EXPENSES
The first section of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you incurred over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses attributable to your investment during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second section of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. Thus, you should not use the hypothetical account values and expenses to estimate the actual ending account balance or your expenses for the period. Rather, these figures are required to be provided to enable you to compare the ongoing costs of investing in the Fund with other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Semi-Annual Shareholder Report
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase or redemption payments. Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.Beginning Account Value 11/1/2011 | Ending Account Value 4/30/2012 | Expenses Paid During Period1 |
Actual: |
Class C Shares | $1,000 | $1,118.50 | $7.53 |
Class R Shares | $1,000 | $1,120.40 | $5.80 |
Institutional Shares | $1,000 | $1,124.70 | $1.85 |
Service Shares | $1,000 | $1,122.80 | $3.43 |
Hypothetical (assuming a 5% return before expenses): |
Class C Shares | $1,000 | $1,017.75 | $7.17 |
Class R Shares | $1,000 | $1,019.39 | $5.52 |
Institutional Shares | $1,000 | $1,023.12 | $1.76 |
Service Shares | $1,000 | $1,021.63 | $3.27 |
1 | Expenses are equal to the Fund's annualized net expense ratios, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half-year period). The annualized net expense ratios are as follows: |
Class C Shares | 1.43% |
Class R Shares | 1.10% |
Institutional Shares | 0.35% |
Service Shares | 0.65% |
Evaluation and Approval of Advisory Contract – May 2011
federated max-cap index fund (the “Fund”)
The Fund's Board reviewed the Fund's investment advisory and subadvisory contracts at meetings held in May 2011. The Board's decision regarding these contracts reflects the exercise of its business judgment on whether to continue the existing arrangements.
In this connection, the Federated Funds' Board had previously appointed a Senior Officer, whose duties include specified responsibilities relating to the process by which advisory fees are to be charged to a Federated fund. The Senior Officer has the authority to retain consultants, experts, or staff as may be reasonably necessary to assist in the performance of his duties, reports directly to the Board, and may be terminated only with the approval of a majority of the independent members of the Board. The Senior Officer prepared and furnished to the Board an independent, written evaluation that covered topics discussed below (the “Evaluation”). The Board considered that Evaluation, along with other information, in deciding to approve the advisory and subadvisory contracts.
During its review of these contracts, the Board considered compensation and benefits received by the Adviser and subadviser. This included the fees received for services provided to the Fund by other entities in the Federated organization and research services (if any) received by the Adviser and subadviser from brokers that execute Federated fund trades, as well as advisory fees. The Board is also familiar with and considered judicial decisions concerning allegedly excessive investment advisory fees, which have indicated that the following factors may be relevant to an Adviser's fiduciary duty with respect to its receipt of compensation from a fund: the nature and quality of the services provided by the Adviser, including the performance of the Fund; the Adviser's cost of providing the services; the extent to which the Adviser may realize “economies of scale” as the Fund grows larger; any indirect benefits that may accrue to the Adviser and its affiliates as a result of the Adviser's relationship with the Fund; performance and expenses of comparable funds; and the extent to which the independent Board members are fully informed about all facts the Board deems relevant bearing on the Adviser's services and fees. The Board further considered management fees (including any components thereof) charged to institutional and other clients of the Adviser for what might be viewed as like services, and the cost to the Adviser and its affiliates of supplying services pursuant to the management fee agreements, excluding any intra-corporate profit and profit margins of the Adviser and its affiliates for supplying such services. Information regarding the subadviser's customary fee schedules was Semi-Annual Shareholder Report
included in the materials furnished by the subadviser in connection with the Board's review. The Board was aware of these factors and was guided by them in its review of the Fund's advisory and subadvisory contracts to the extent it considered them to be appropriate and relevant, as discussed further below.The Board considered and weighed these circumstances in light of its substantial accumulated experience in governing the Fund and working with Federated on matters relating to the Federated funds, and was assisted in its deliberations by independent legal counsel. Throughout the year, the Board has requested and received substantial and detailed information about the Fund and the Federated organization that was in addition to the extensive materials that comprise and accompany the Senior Officer's Evaluation. Federated provided much of this information at each regular meeting of the Board, and furnished additional information in connection with the particular meeting at which the Board's formal review of the advisory and subadvisory contracts occurred. Between regularly scheduled meetings, the Board also received information on particular matters as the need arose. Thus, the Board's consideration of the advisory and subadvisory contracts included review of the Senior Officer's Evaluation, accompanying data and additional information covering such matters as: the Adviser's and subadviser's profitability, investment philosophy, revenue, personnel and processes; investment and operating strategies; the Fund's short- and long-term performance (in absolute terms, both on a gross basis and net of expenses, as well as in relationship to its particular investment program and certain competitor or “peer group” funds and/or other benchmarks, as appropriate), and comments on the reasons for performance; the Fund's investment objectives; the Fund's expenses (including the advisory fee itself and the overall expense structure of the Fund, both in absolute terms and relative to similar and/or competing funds, with due regard for contractual or voluntary expense limitations); the use and allocation of brokerage commissions derived from trading the Fund's portfolio securities (if any); and the nature, quality and extent of the advisory and other services provided to the Fund by the Adviser, the subadviser, and their affiliates. The Board also considered the preferences and expectations of Fund shareholders and their relative sophistication; the continuing state of competition in the mutual fund industry and market practices; the range of comparable fees for similar funds in the mutual fund industry; the Fund's relationship to the Federated family of funds which include a comprehensive array of funds with different investment objectives, policies and strategies which are available for exchange without the incurrence of additional sales charges; compliance and audit reports concerning the Federated funds, the Federated companies that service them, and the subadviser (including communications from regulatory agencies), as well as Federated's and/or the subadviser's responses to any issues raised therein; and relevant developments in Semi-Annual Shareholder Report
the mutual fund industry and how the Federated funds and/or Federated are responding to them. The Board's evaluation process is evolutionary. The criteria considered and the emphasis placed on relevant criteria change in recognition of changing circumstances in the mutual fund marketplace.With respect to the Fund's performance and expenses in particular, the Board has found the use of comparisons to other mutual funds with comparable investment programs to be relevant, given the high degree of competition in the mutual fund business. The Board focused on comparisons with other similar mutual funds more heavily than non-mutual fund products or services because it is believed that they are more relevant. For example, other mutual funds are the products most like the Fund, they are readily available to Fund shareholders as alternative investment vehicles, and they are the type of investment vehicle in fact chosen and maintained by the Fund's investors. The range of their fees and expenses therefore appears to be a generally reliable indication of what consumers have found to be reasonable in the precise marketplace in which the Fund competes. The Fund's ability to deliver competitive performance when compared to its peer group was a useful indicator of how the Adviser and subadviser are executing the Fund's investment program, which in turn assisted the Board in reaching a conclusion that the nature, extent, and quality of the Adviser's and subadviser's investment management services were such as to warrant continuation of the advisory and subadvisory contracts. In this regard, the Senior Officer has reviewed Federated's and the subadviser's fees for providing advisory services to products outside the Federated family of funds (e.g., institutional and separate accounts). He concluded that mutual funds and institutional accounts are inherently different products. Those differences included, but are not limited to, different types of targeted investors, being subject to different laws and regulations, different legal structures, different average account sizes, different associated costs, different portfolio management techniques made necessary by different cash flows, and portfolio manager time spent in review of securities pricing. The Senior Officer did not consider these fee schedules to be determinative in judging the appropriateness of mutual fund advisory contracts.
The Senior Officer reviewed information compiled by Federated, using data supplied by independent fund ranking organizations, regarding the performance of, and fees charged by, other mutual funds, noting his view that comparisons to fund peer groups are relevant in judging the reasonableness of proposed fees.
For the periods covered by the Evaluation, the Fund's performance for the one and three-year period was above the median of the relevant peer group, and the Fund's performance fell below the median of the relevant peer group for the five-year period. The Board discussed the Fund's performance with the Adviser and recognized the efforts being undertaken by the Adviser and subadviser. The Board will continue to monitor these efforts and the performance of the Fund.
Semi-Annual Shareholder Report
The Board also received financial information about Federated, including information regarding the compensation and benefits Federated derived from its relationships with the Federated funds. This information covered not only the fees under the advisory contracts, but also fees received by Federated's subsidiaries for providing other services to the Federated funds under separate contracts (e.g., for serving as the Federated funds' administrator). The information also detailed any indirect benefit Federated may derive from its receipt of research services from brokers who execute Federated fund trades. In addition, the Board considered the fact that, in order for a fund to be competitive in the marketplace, Federated and its affiliates frequently waived fees and/or reimbursed expenses and have disclosed to fund investors and/or indicated to the Board their intention to do so in the future, where appropriate. Moreover, the Board receives regular reporting as to the institution or elimination of these voluntary waivers. The Board also received financial information about the subadviser, as well as information that discussed any indirect benefit the subadviser may derive from its receipt of research services from brokers who execute Fund trades.Federated furnished information, requested by the Senior Officer, that reported revenues on a fund-by-fund basis and made estimates of the allocation of expenses on a fund-by-fund basis, using allocation methodologies specified by the Senior Officer. The Senior Officer noted that, although they may apply consistent allocation processes, the inherent difficulties in allocating costs (and the unavoidable arbitrary aspects of that exercise) and the lack of consensus on how to allocate those costs may render such allocation information unreliable. The Board received similar revenue and cost information about the Fund from the subadviser. The allocation information was considered in the analysis by the Board but was determined to be of limited use.
The Board and the Senior Officer also reviewed information compiled by Federated comparing profitability information for Federated and the subadviser to other publicly held fund management companies. In this regard, the Senior Officer noted the limited availability of such information, but nonetheless concluded that Federated's and the subadviser's profit margins did not appear to be excessive and the Board agreed.
The Senior Officer's Evaluation also discussed the notion of possible realization of “economies of scale” as a fund grows larger. The Board considered in this regard that the Adviser has made significant and long-term investments in areas that support all of the Federated funds, such as personnel and processes for the portfolio management, compliance, internal audit, and risk management functions; and systems technology; and that the benefits of these efforts (as well as any economies, should they exist) were likely to be enjoyed by the fund complex as a whole. Finally, the Board also noted the absence of any applicable regulatory or industry guidelines on this subject, which (as discussed in the Senior Officer's Evaluation) is compounded by the lack of any common Semi-Annual Shareholder Report
industry practice or general pattern with respect to structuring fund advisory fees with “breakpoints” that serve to reduce the fee as the fund attains a certain size. The Senior Officer did not recommend institution of breakpoints in pricing Federated's fund advisory services at this time.It was noted in the materials for the Board meeting that, for the period covered by the Evaluation, the Fund's investment advisory fee, after waivers and expense reimbursements, if any, was above the median of the relevant peer group. The Board reviewed the fees and other expenses of the Fund with the Adviser and was satisfied that the overall expense structure of the Fund remained competitive. The Board will continue to monitor advisory fees and other expenses borne by the Fund.
The Senior Officer noted that, considering the totality of the circumstances, and all of the factors referenced within his Evaluation, he had concluded that, subject to comments and recommendations made within his Evaluation, his observations and the information accompanying the Evaluation supported a finding by the Board that the management fees for each of the funds are reasonable and that Federated appeared to provide appropriate administrative services to the Fund for the fees paid. Under these circumstances, no changes were recommended to, and no objection was raised to, the continuation of the Fund's advisory and subadvisory contracts. The Board concluded that the nature, quality and scope of services provided the Fund by the Adviser and its affiliates, and by the subadviser, were satisfactory.
In its decision to continue an existing investment advisory contract, the Board was mindful of the potential disruptions of the Fund's operations and various risks, uncertainties and other effects that could occur as a result of a decision to terminate or not renew an advisory contract. In particular, the Board recognized that many shareholders have invested in the Fund on the strength of the Adviser's industry standing and reputation and with the expectation that the Adviser will have a continuing role in providing advisory services to the Fund. Thus, the Board's approval of the advisory contract reflected the fact that it is the shareholders who have effectively selected the Adviser by virtue of having invested in the Fund.
The Board based its decision to approve the advisory and subadvisory contracts on the totality of the circumstances and relevant factors and with a view to past and future long-term considerations. Not all of the factors and considerations identified above were necessarily relevant to the Fund, nor did the Board consider any one of them to be determinative. With respect to the factors that were relevant, the Board's decision to approve the contract reflects its determination that Federated's performance and actions provided a satisfactory basis to support the decision to continue the existing arrangements.
Semi-Annual Shareholder ReportVoting Proxies on Fund Portfolio Securities
A description of the policies and procedures that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 1-800-341-7400. A report on “Form N-PX” of how the Fund voted any such proxies during the most recent 12-month period ended June 30 is available from Federated's website at FederatedInvestors.com. To access this information from the home page, select “All” under “Asset Classes.” Select a fund name and share class, if applicable, to go to the Fund Overview page. On the Fund Overview page, select the “Documents” tab. At the bottom of that page, select “Proxy Voting Record Report (Form N-PX).” Form N-PX filings are also available at the SEC's website at www.sec.gov.
The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on “Form N-Q.” These filings are available on the SEC's website at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. (Call 1-800-SEC-0330 for information on the operation of the Public Reference Room.) You may also access this information from the “Products” section of Federated's website at FederatedInvestors.com. From the home page, select “All” under “Asset Classes.” Select a fund name and share class, if applicable, to go to the Fund Overview page. On the Fund Overview page, select the “Documents” tab. At the bottom of that page, select “Form N-Q.”
Semi-Annual Shareholder ReportMutual funds are not bank deposits or obligations, are not guaranteed by any bank and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency. Investment in mutual funds involves investment risk, including the possible loss of principal.
This Report is authorized for distribution to prospective investors only when preceded or accompanied by the Fund's Prospectus, which contains facts concerning its objective and policies, management fees, expenses and other information.
IMPORTANT NOTICE ABOUT FUND DOCUMENT DELIVERY
In an effort to reduce costs and avoid duplicate mailings, the Fund(s) intend to deliver a single copy of certain documents to each household in which more than one shareholder of the Fund(s) resides (so-called “householding”), as permitted by applicable rules. The Fund's “householding” program covers its/their Prospectus and Statement of Additional Information, and supplements to each, as well as Semi-Annual and Annual Shareholder Reports and any Proxies or information statements. Shareholders must give their written consent to participate in the “householding” program. The Fund is also permitted to treat a shareholder as having given consent (“implied consent”) if (i) shareholders with the same last name, or believed to be members of the same family, reside at the same street address or receive mail at the same post office box, (ii) the Fund gives notice of its intent to “household” at least sixty (60) days before it begins “householding” and (iii) none of the shareholders in the household have notified the Fund(s) or their agent of the desire to “opt out” of “householding.” Shareholders who have granted written consent, or have been deemed to have granted implied consent, can revoke that consent and opt out of “householding” at any time: shareholders who purchased shares through an intermediary should contact their representative; other shareholders may call the Fund at 1-800-341-7400.
Federated Max-Cap Index Fund
Federated Investors Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
Contact us at FederatedInvestors.com
or call 1-800-341-7400.
Federated Securities Corp., Distributor
CUSIP 31420E502
CUSIP 31420E809
CUSIP 31420E106
CUSIP 31420E403
2052905 (6/12)
Federated is a registered trademark of Federated Investors, Inc.
2012 © Federated Investors, Inc.
Item 2. Code of Ethics
Not Applicable
Item 3. Audit Committee Financial Expert
Not Applicable
Item 4. Principal Accountant Fees and Services
Not Applicable
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
Not Applicable
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 second fiscal quarter of 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. Exhibits
(a)(1) Code of Ethics- Not Applicable to this Semi-Annual 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 Index Trust
By /S/ Richard A. Novak
Richard A. Novak
Principal Financial Officer
Date June 19, 2012
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 June 19, 2012
By /S/ Richard A. Novak
Richard A. Novak
Principal Financial Officer
Date June 19, 2012