UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
811-10625
(Investment Company Act File Number)
Federated Core Trust II, L.P.
_______________________________________________________________
(Exact Name of Registrant as Specified in Charter)
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, Pennsylvania 15237-7000
(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: 12/31/07
Date of Reporting Period: Six months ended 6/30/07
ITEM 1. REPORTS TO STOCKHOLDERS
MARKET PLUS CORE FUND
A PORTFOLIO OF FEDERATED CORE TRUST II, L.P.
SEMI-ANNUAL SHAREHOLDER REPORT
June 30, 2007
FINANCIAL HIGHLIGHTS
SHAREHOLDER EXPENSE EXAMPLE
PORTFOLIO OF INVESTMENTS SUMMARY TABLE
PORTFOLIO OF INVESTMENTS
STATEMENT OF ASSETS AND LIABILITIES
STATEMENT OF OPERATIONS
STATEMENT OF CHANGES IN NET ASSETS
NOTES TO FINANCIAL STATEMENTS
EVALUATION AND APPROVAL OF ADVISORY CONTRACT
VOTING PROXIES ON FUND PORTFOLIO SECURITIES
QUARTERLY PORTFOLIO SCHEDULE
NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout Each Period)
SIX MONTHS YEAR ENDED DECEMBER 31,
ENDED
6/30/2007 2006 2005 1
NET ASSET VALUE, BEGINNING OF PERIOD $12.01 $10.32 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.32 0.17 0.11
Net realized and unrealized gain on investments, futures contracts and swap contracts 0.52 1.52 0.21
TOTAL FROM INVESTMENT OPERATIONS 0.84 1.69 0.32
NET ASSET VALUE, END OF PERIOD $12.85 $12.01 $10.32
TOTAL RETURN2 6.99 % 16.38 % 3.20 %
RATIOS TO AVERAGE NET ASSETS:
Net expenses 0.05 %3 0.05 % 0.05 %3
Net investment income 5.42 %3 5.47 % 4.30 %3
Expense waiver/reimbursement4 0.58 %3 1.55 % 6.45 %3
SUPPLEMENTAL DATA:
Net assets, end of period (000 omitted) $48,103 $44,106 $5,160
Portfolio turnover 218 % 396 % 11 %
1 Reflects operations for the period from October 4, 2005 (date of initial
investment) to December 31, 2005.
2 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.
3 Computed on an annualized basis.
4 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
SHAREHOLDER EXPENSE EXAMPLE
As a shareholder of the Fund, you incur ongoing costs, including to the extent
applicable, management fees, 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 January 1, 2007 to June 30, 2007.
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.
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 ENDING EXPENSES PAID
ACCOUNT VALUE ACCOUNT VALUE DURING PERIOD1
1/1/2007 6/30/2007
ACTUAL $1,000 $1,069.90 $0.26
HYPOTHETICAL (ASSUMING A 5% RETURN BEFORE EXPENSES) $1,000 $1,024.55 $0.25
1 Expenses are equal to the Fund's annualized net expense ratio of 0.05%,
multiplied by the average account value over the period, multiplied by
181/365 (to reflect the one-half year period).
PORTFOLIO OF INVESTMENTS SUMMARY TABLE
At June 30, 2007, the Fund's portfolio composition1 was as follows:
SECURITY TYPE PERCENTAGE OF
TOTAL NET ASSETS
Mortgage-Backed Securities2 56.9 %
Corporate Debt Securities 18.9 %
U.S. Treasury and Agency Securities3 10.9 %
Asset-Backed Securities 4.2 %
Cash Equivalents4 9.5 %
Other Assets and Liabilities-Net5 (0.4 )%
TOTAL 100.0 %
1 See the Fund's Confidential Private Offering Memorandum for a description of
these security types.
2 For purposes of this table, Mortgage-Backed Securities include mortgage-backed
securities guaranteed by Government Sponsored Entities (GSEs) and adjustable
rate mortgage-backed securities.
3 For purposes of this table, U.S. Treasury and Agency Securities do not include
mortgage-backed securities guaranteed by GSEs.
4 Cash Equivalents include any investments in money market mutual funds and/or
overnight repurchase agreements.
5 Assets, other than investments in securities, less liabilities. See Statement
of Assets and Liabilities.
PORTFOLIO OF INVESTMENTS
June 30, 2007 (unaudited)
PRINCIPAL VALUE
AMOUNT OR SHARES
ADJUSTABLE RATE MORTGAGES-29.5%
FEDERAL HOME LOAN MORTGAGE CORP.-26.9%
$ 5,815,392 Federal Home Loan Mortgage Corp., 5.437%, 12/1/2035 $ 5,781,164
4,718,056 Federal Home Loan Mortgage Corp., 5.630%, 6/1/2036 4,726,390
2,412,363 Federal Home Loan Mortgage Corp., 5.641%, 5/1/2037 2,411,420
TOTAL 12,918,974
FEDERAL NATIONAL MORTGAGE ASSOCIATION-2.6%
141,824 Federal National Mortgage Association, 5.330%, 5/1/2036 142,053
1,047,599 Federal National Mortgage Association, 5.440%, 4/1/2036 1,051,000
29,190 Federal National Mortgage Association, 6.960%, 6/1/2035 29,606
40,818 Federal National Mortgage Association, 7.000%, 4/1/2035 41,403
TOTAL 1,264,062
TOTAL ADJUSTABLE RATE MORTGAGES (IDENTIFIED COST $14,224,673) 14,183,036
ASSET-BACKED SECURITIES-4.2%
HOME EQUITY LOAN-2.9%
35,241 Asset Backed Funding Certificate 2005-OPT1 A1MZ, 7/25/2035 35,445
72,703 Centex Home Equity 2005-D AV2, 10/25/2035 72,781
54,646 GSAA Home Equity Trust 2005-15 1A2, 1/25/2036 54,860
75,000 GSAA Home Equity Trust 2005MTR1 A3, 10/25/2035 75,234
173,981 1,2 GSAA Home Equity Trust 2006-8N N1, 10/26/2036 171,807
61,472 GSAMP Trust 2005-SEA2 A1, 1/25/2045 61,028
280,000 Morgan Stanley ABS Capital I 2004-OP1 M3, 11/25/2034 279,783
400,000 Morgan Stanley ABS Capital I 2005-WMC4 M1, 4/25/2035 399,882
50,056 Novastar Home Equity Loan A1B, 3/25/2035 50,185
116,883 Option One Mortgage Loan Trust 2005-1 A1B, 2/25/2035 117,346
75,000 Popular ABS Mortgage Pass-Through Trust 2005-5 AV2B, 11/25/2035 75,275
TOTAL 1,393,626
NON-AGENCY MORTGAGE - 1.3%
36,561 Harborview Mortgage Loan Trust 2006-1 2A1A, 3/19/2037 36,616
500,000 1,2 KLIO Funding Ltd. 2004-1A A1, 4/23/2039 502,636
78,370 Washington Mutual 2003-S4 1A3, 6/25/2018 78,607
27,277 Washington Mutual 2005-AR17 A-1A1, 12/25/2045 27,281
TOTAL 645,140
TOTAL ASSET-BACKED SECURITIES (IDENTIFIED COST $2,040,644) 2,038,766
COLLATERALIZED MORTGAGE OBLIGATIONS-6.7%
FEDERAL HOME LOAN MORTGAGE CORP.-0.4%
109,293 Federal Home Loan Mortgage Corp. REMIC 2395 FA, 5.920%, 6/15/2029 111,080
80,824 Federal Home Loan Mortgage Corp. REMIC 2395 FT, 5.770%, 12/15/2031 81,439
TOTAL 192,519
FEDERAL NATIONAL MORTGAGE ASSOCIATION-0.6%
100,000 Federal National Mortgage Association REMIC 0287A FB, 5.591%, 10/25/2031 100,988
154,883 Federal National Mortgage Association REMIC 1993-179 FJ, 6.494%, 10/25/2023 159,210
44,812 Federal National Mortgage Association REMIC 1993-247 FM, 5.424%, 12/25/2023 44,487
TOTAL 304,685
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION-0.3%
150,466 Government National Mortgage Association REMIC 1999-13 PC, 6.000%, 3/20/2028 150,092
NON-AGENCY MORTGAGE - 5.4%
787,265 Citigroup Mortgage Loan Trust, 2004UST1 A2, 8/25/2034 797,001
363,577 Washington Mutual 2006-AR1 2A1B, 1/25/2046 364,119
430,899 Washington Mutual 2006-AR15 1A, 11/25/2046 430,785
336,538 Washington Mutual 2006-AR17 1A, 12/25/2046 336,677
277,204 Washington Mutual 2002-AR6 2002-AR6 A, 6/25/2042 277,071
383,469 Washington Mutual Mortgage Pass Through Certificates 2007-OA3 DA1C, 4/25/2047 384,378
TOTAL 2,590,031
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (IDENTIFIED COST $3,216,359) 3,237,327
CORPORATE BONDS-18.9%
COMMUNICATIONS - TELECOM WIRELESS-1.2%
600,000 Vodafone Group PLC, Note, 2/27/2012 601,313
COMMUNICATIONS - TELECOM WIRELINES-1.6%
50,000 SBC Communications, Inc., 11/14/2008 50,129
300,000 Telecom Italia Capital, Note, 2/01/2011 301,496
400,000 Telefonica SA, Floating Rate Note, 6/19/2009 401,535
TOTAL 753,160
CONSUMER CYCLICAL - ENTERTAINMENT-1.1%
515,000 Time Warner, Inc., Floating Rate Note, 11/13/2009 516,228
CONSUMER CYCLICAL - SERVICES-1.0%
500,000 1,2 Realogy Corp., Sr. Note, 10/20/2009 501,031
ENERGY - INDEPENDENT-0.6%
280,000 Anadarko Petroleum Corp., Floating Rate Note, 9/15/2009 280,393
FINANCIAL INSTITUTION - BANKING-9.7%
900,000 Chase Capital II, Company Guarantee, 2/01/2027 865,761
900,000 Nationsbank Capital Trust, Bond, 1/15/2027 881,987
40,000 Popular North America, 4/06/2009 40,121
1,100,000 State Street Capital Trust IV, 6/15/2037 1,102,484
900,000 Wachovia Capital Trust II, Company Guarantee, 1/15/2027 876,837
900,000 Wells Fargo Capital II, Company Guarantee, 1/30/2027 881,858
TOTAL 4,649,048
FINANCIAL INSTITUTION - BROKERAGE-0.2%
50,000 Goldman Sachs Group, Inc., Floating Rate Note, 9/29/2014 50,737
50,000 Morgan Stanley Group, In, 1/18/2011 50,143
TOTAL 100,880
FINANCIAL INSTITUTION - FINANCE NONCAPTIVE-2.4%
310,000 CIT Group, Inc., Sr. Note, 2/13/2012 306,893
250,000 1,2 Capmark Financial Group, Inc., Unsecd. Note, 5/10/2010 250,620
625,000 Residential Capital Corp., Sr. Unsecd. Note, 6/09/2008 618,804
TOTAL 1,176,317
FINANCIAL INSTITUTION - INSURANCE - P&C-1.1%
30,000 CNA Financial Corp., 8/15/2016 30,297
500,000 1,2 ZFS Finance USA Trust III, Floating Rate Note, 12/15/2065 506,311
TOTAL 536,608
TOTAL CORPORATE BONDS (IDENTIFIED COST $9,105,492) 9,114,978
MORTGAGE-BACKED SECURITIES-20.7%
FEDERAL HOME LOAN MORTGAGE CORP.-13.3%
2,060,871 Federal Home Loan Mortgage Corp. Pool G08153, 7.000%, 30 Year, 9/1/2036 2,115,523
759,312 Federal Home Loan Mortgage Corp. Pool G18124, 6.000%, 15 Year, 6/1/2021 762,350
3,490,784 Federal Home Loan Mortgage Corp. Pool G18136, 6.000%, 15 Year, 8/1/2021 3,504,749
TOTAL 6,382,622
FEDERAL NATIONAL MORTGAGE ASSOCIATION-7.4%
539,208 Federal National Mortgage Association Pool 256360, 7.000%, 30 Year, 8/1/2036 553,803
1,372,410 Federal National Mortgage Association Pool 891171, 7.000%, 30 Year, 7/1/2036 1,409,555
1,546,221 Federal National Mortgage Association Pool 895073, 7.000%, 30 Year, 8/1/2036 1,588,071
TOTAL 3,551,429
TOTAL MORTGAGE-BACKED SECURITIES (IDENTIFIED COST $9,961,726) 9,934,051
U.S. TREASURY-10.9%
TREASURY SECURITIES-10.9%
1,199,847 U.S. Treasury Inflation Protected Note, Series D-2010, 0.875%, 4/15/2010 1,139,821
4,100,000 3,4 United States Treasury Bill, 4.96%, 7/26/2007 4,088,602
TOTAL U.S. TREASURY (IDENTIFIED COST $5,223,912) 5,228,423
Mutual Fund-9.5%
4,550,608 5,6 Prime Value Obligations Fund, Institutional Shares, 5.26% (AT NET ASSET VALUE) 4,550,608
TOTAL INVESTMENTS-100.4% 48,287,189
(IDENTIFIED COST $48,323,414)7
OTHER ASSETS AND LIABILITIES - NET-(0.4)% (184,486 )
TOTAL NET ASSETS-100% $ 48,102,703
1 Denotes a restricted security that either: (a) cannot be offered for public
sale without first being registered, or being able to take advantage of an
exemption from registration, under the Securities Act of 1933; or (b) is subject
to a contractual restriction on public sales. At June 30, 2007, these restricted
securities amounted to $1,932,405, which represented 4.0% of total net assets.
2 Denotes a restricted security that may be resold without restriction to
"qualified institutional buyers" as defined in Rule 144A under the Securities
Act of 1933 and that the Fund has determined to be liquid under criteria
established by the Fund's Board of Directors. At June 30, 2007, these liquid
restricted securities amounted to $1,932,405, which represented 4.0% of total
net assets.
3 Discount rate at time of purchase.
4 Pledged as collateral to ensure the Fund is able to satisfy the obligations of
its outstanding futures contracts.
5 Affiliated company.
6 7-Day net yield.
7 Also represents cost for federal tax purposes.
At June 30, 2007, the Fund had the following outstanding futures contracts:
DESCRIPTION NUMBER OF CONTRACTS NOTIONAL VALUE EXPIRATION DATE UNREALIZED
APPRECIATION/ (DEPRECIATION)
8S&P 500 Index Long Futures 10 $3,788,500 September 2007 $(38,825)
8S&P Mini 500 Index Long Futures 4 $303,100 September 2007 $(3,110)
8U.S. Treasury Notes 2 Year Short Futures 95 $19,359,219 September 2007 $24,738
NET UNREALIZED DEPRECIATION ON FUTURES CONTRACTS $(17,197)
At June 30, 2007, the Fund had the following open swap contracts:
TOTAL RETURN SWAP REFERENCE BUY/SELL PAY/RECEIVE EXPIRATION NOTIONAL AMOUNT UNREALIZED APPRECIATION/
COUNTERPARTY INDEX FIXED RATE DATE (DEPRECIATION)
Lehman Brothers S&P 500 Buy 5.39% 9/7/2007 $35,911,519 $(929,412)
International Total Return
Merrill Lynch S&P 500 Buy 5.36% 10/4/2007 $8,599,806 $323,162
International Total Return
NET UNREALIZED DEPRECIATION ON SWAP CONTRACTS $(606,250)
8 Non-income producing security.
Note: The categories of investments are shown as a percentage of total net
assets at June 30, 2007.
The following acronym is used throughout this portfolio:
REMIC -Real Estate Mortgage Investment Conduit
See Notes which are an integral part of the Financial Statements
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2007 (unaudited)
ASSETS:
Total investments in securities, at value including $4,550,608 of investments in an $ 48,287,189
affiliated issuer (Note 5) (identified cost $48,323,414)
Income receivable 472,385
TOTAL ASSETS 48,759,574
LIABILITIES:
Payable for daily variation margin $ 33,043
Net payable for swap contracts 606,250
Accrued expenses 17,578
TOTAL LIABILITIES 656,871
Net assets for 3,742,531 shares outstanding $ 48,102,703
NET ASSETS CONSIST OF:
Paid-in capital $ 40,726,195
Net unrealized depreciation of investments, futures contracts and swap contracts (659,672)
Accumulated net realized gain on investments, futures contracts and swap contracts 5,799,193
Undistributed net investment income 2,236,987
TOTAL NET ASSETS $ 48,102,703
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PROCEEDS PER SHARE:
$48,102,703 {divide} 3,742,531 shares outstanding, no par value, unlimited shares authorized $12.85
See Notes which are an integral part of the Financial Statements
STATEMENT OF OPERATIONS
Six Months Ended June 30, 2007 (unaudited)
INVESTMENT INCOME:
Interest (net of foreign taxes withheld of $1,020) $ 1,191,862
Dividends received from an affiliated issuer (Note 5) 53,007
TOTAL INCOME 1,244,869
EXPENSES:
Administrative personnel and services fee (Note 5) $ 74,384
Custodian fees 4,187
Transfer and dividend disbursing agent fees and expenses 7,661
Directors'/Trustees' fees 2,076
Auditing fees 11,480
Legal fees 5,001
Portfolio accounting fees 22,379
Insurance premiums 3,104
Taxes 12,397
Miscellaneous 286
TOTAL EXPENSES 142,955
WAIVER AND REIMBURSEMENT (NOTE 5):
Waiver of administrative personnel and services fee $ (74,384)
Reimbursement of other operating expenses (57,187)
TOTAL WAIVER AND REIMBURSEMENT (131,571)
Net expenses 11,384
Net investment income 1,233,485
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FUTURES
CONTRACTS AND SWAP CONTRACTS:
Net realized loss on investments (15,724)
Net realized gain on futures contracts 223,688
Net realized gain on swap contracts 2,831,345
Net change in unrealized appreciation of investments (70,431)
Net change in unrealized appreciation of futures contracts (42,432)
Net change in unrealized appreciation of swap contracts (1,073,347)
Net realized and unrealized gain on investments, futures contracts 1,853,099
and swap contracts
Change in net assets resulting from operations $ 3,086,584
See Notes which are an integral part of the Financial Statements
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS
ENDED YEAR ENDED
(unaudited) 12/31/2006
6/30/2007
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income $ 1,233,485 $ 950,871
Net realized gain on investments, futures contracts and swap contracts 3,039,309 2,744,339
Net change in unrealized appreciation/depreciation of investments, futures contracts (1,186,210) 434,567
and swap contracts
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS 3,086,584 4,129,777
SHARE TRANSACTIONS:
Proceeds from sale of shares 1,000,000 40,200,000
Cost of shares redeemed -- (5,473,905)
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 1,000,000 34,726,095
Change in net assets 4,086,584 38,855,872
NET ASSETS:
Beginning of period 44,016,119 5,160,247
End of period (including undistributed net investment income of $2,236,987 and $ 48,102,703 $ 44,016,119
$1,003,502, respectively)
See Notes which are an integral part of the Financial Statements
NOTES TO FINANCIAL STATEMENTS
June 30, 2007 (unaudited)
1. ORGANIZATION
Market Plus Core Fund (the "Fund") is a diversified portfolio of Federated Core
Trust II, L.P. (the "Trust"). The Trust is registered under the Investment
Company Act of 1940, as amended (the "Act"). The Trust is a limited partnership
that was established under the laws of the State of Delaware on November 13,
2000 and offered only to registered investment companies and other accredited
investors. The Trust consists of three portfolios. The financial statements
included herein are only those of the Fund. Each portfolio pays its own
expenses. The Fund's investment objective is to seek total return over the
business cycle (which may be longer or shorter than a 12-month period) in excess
of the S&P 500 Index.
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 generally accepted accounting principles (GAAP)
in the United States of America.
INVESTMENT VALUATION
Market values of the Fund's portfolio securities are determined as follows:
{circle}for mortgage-backed securities, based on the aggregate investment
value of the projected cash flows to be generated by the security, as
furnished by an independent pricing service;
{circle}for other fixed-income securities, according to prices as furnished
by an independent pricing service, except that fixed-income securities
with remaining maturities of less than 60 days at the time of purchase
are valued at amortized cost;
{circle}for investments in other open-end registered investment companies,
based on net asset value (NAV);
{circle}futures contracts and options are generally valued at market values
established by the exchanges on which they are traded at the close of
trading on such exchanges. Options traded in the over-the-counter market
are generally valued according to the mean between the last bid and the
last asked price for the option as provided by an investment dealer or
other financial institution that deals in the option. The Board of
Directors (the "Directors") may determine in good faith that another
method of valuing such investments is necessary to appraise their fair
market value;
{circle}prices for total return swaps are based upon a valuation model
determined by management incorporating underlying reference indexes,
interest rates, yield curves and other market data or factors; prices for
credit default swaps are furnished by an independent pricing service and
are based upon a valuation model incorporating default probabilities,
recovery rates and other market data or factors; prices for interest rate
swaps are furnished by an independent pricing service and are based upon
a valuation model incorporating interest rates, yield curves and other
market data or factors;
{circle}for equity securities, according to the last sale price or official
closing price reported in the market in which they are primarily traded
(either a national securities exchange or the over-the-counter market),
if available;
{circle}in the absence of recorded sales for equity securities, according to
the mean between the last closing bid and asked prices; and
{circle}for all other securities at fair value as determined in accordance
with procedures established by and under the general supervision of the
Directors.
Prices for fixed-income securities furnished by a pricing service may be based
on a valuation matrix which incorporates both dealer-supplied valuations and
electronic data processing techniques. Such prices (other than prices of
mortgage-backed securities) are generally intended to be indicative of the bid
prices currently offered to institutional investors for the securities, except
that prices for corporate fixed-income and asset-backed securities traded in the
United States are generally intended to be indicative of the mean between such
bid prices and asked prices. The Directors have approved the use of such pricing
services. A number of pricing services are available, and the Fund may use
various pricing services or discontinue the use of any pricing service.
Prices provided by independent pricing services may be determined without
relying exclusively on quoted prices and may consider institutional trading in
similar groups of securities, yield, quality, stability, risk, coupon rate,
maturity, type of issue, trading characteristics, and other market data or
factors. From time to time, when prices cannot be obtained from an independent
pricing service, securities may be valued based on quotes from broker-dealers or
other financial institutions that trade the securities.
Trading in foreign securities may be completed at times which vary from the
closing of the New York Stock Exchange (NYSE). In computing its NAV, the Fund
values foreign securities using the latest closing price on the exchange on
which they are traded immediately prior to the closing of the NYSE. Certain
foreign currency exchange rates are generally determined at the latest rate
prior to the closing of the NYSE. Foreign securities quoted in foreign
currencies are translated into U.S. dollars at current rates. Events that affect
these values and exchange rates may occur between the times at which they are
determined and the closing of the NYSE. If such events materially affect the
value of portfolio securities, these securities may be valued at their fair
value as determined in good faith by the Directors, although the actual
calculation is done by others under the direction of Fund management. An event
is considered material if there is both an affirmative expectation that the
security's value will change in response to the event and a reasonable basis for
quantifying the resulting change in value.
REPURCHASE AGREEMENTS
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.
With respect to agreements to repurchase U.S. government securities and cash
items, the Fund treats the repurchase agreement as an investment in the
underlying securities and not as an obligation of the other party to the
repurchase agreement. Other repurchase agreements are treated as obligations of
the other party secured by the underlying securities. Nevertheless, 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
adviser 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, EXPENSES AND DISTRIBUTIONS
Interest income and expenses are accrued daily. Dividend income is 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. All net income earned and
gain/loss (realized and unrealized) will be allocated daily to the shareholders
based on their capital contributions to the Fund. The Fund does not currently
intend to declare and pay distributions.
PREMIUM AND DISCOUNT AMORTIZATION/ PAYDOWN GAINS AND LOSSES
All premiums and discounts on fixed-income securities other than mortgage-backed
securities are amortized/accreted for financial statement purposes. Gains and
losses realized on principal payment of mortgage-backed securities (paydown
gains and losses) are classified as part of investment income.
FEDERAL TAXES
As a partnership, the Fund is not subject to U.S. federal income tax. Instead,
each investor reports separately on its own federal income tax return its
allocated potion of the Fund's income, gain, losses, deduction and credits.
Withholding taxes and where appropriate, deferred withholding taxes on foreign
interest, dividends and capital gains have been provided for in accordance with
the applicable country's tax rules and rates.
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.
SWAP CONTRACTS
Swap contracts involve two parties that agree to exchange the returns (or the
differential in rates of return) earned or realized on particular predetermined
investments, instruments, indices or other measures. The gross returns to be
exchanged or "swapped" between parties are generally calculated with respect to
a "notional amount" for a predetermined period of time. The Fund may enter into
interest rate, total return, credit default, foreign exchange and other swap
agreements.
Total return swap agreements involve the commitment to pay or receive an amount
generally determined by reference to an interest rate in exchange for a specific
market-linked return, based on notional amounts. To the extent that the total
return of the security or index underlying the transactions exceeds or falls
short of the offsetting interest rate based obligation, the Fund receives or
makes a payment to the counterparty. Risks may arise upon entering into swap
agreements from the potential inability of the counterparties to meet the terms
of their contract from unanticipated changes in the value of the swap agreement.
Upfront payments received or paid by the Fund will be reflected as an asset or
liability on the Statement of Assets and Liabilities. Changes in the value of
swap contracts are included in Net payable for swap contracts on the Statement
of Assets and Liabilities, and periodic payments are reported as Net realized
gain on swap contracts in the Statement of Operations. For the six months ended
June 30, 2007, the Fund had a net realized gain on swap contracts of $2,831,345.
Swap contracts outstanding at period end are listed after the Fund's portfolio
of investments.
FUTURES CONTRACTS
The Fund purchases and sells financial futures contracts to manage cashflows,
enhance yield and to establish and maintain continual economic exposure to
changes in the value of the S&P 500 Index and to potentially reduce transaction
costs. Upon entering into a financial 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. 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. For the
six months ended June 30, 2007, the Fund had net realized gains on futures
contracts of $223,688.
Futures contracts outstanding at period end are listed after the Fund's
portfolio of investments.
RESTRICTED SECURITIES
Restricted securities are securities that either: (a) cannot be offered for
public sale without first being registered, or being able to take advantage of
an exemption from registration, under the Securities Act of 1933; or (b) are
subject to contractual restrictions on public sales. In some cases, when a
security cannot be offered for public sale without first being registered, the
issuer of the restricted security has agreed to register such securities for
resale, at the issuer's expense, either upon demand by the Fund or in connection
with another registered offering of the securities. Many such restricted
securities may be resold in the secondary market in transactions exempt from
registration. Restricted securities may be determined to be liquid under
criteria established by the Directors. The Fund will not incur any registration
costs upon such resales. The Fund's restricted securities are valued at the
price provided by dealers in the secondary market or, if no market prices are
available, at the fair value as determined in accordance with procedures
established by and under the general supervision of the Directors.
USE OF ESTIMATES
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.
OTHER
Investment transactions are accounted for on a trade date basis. Realized gains
and losses from investment transactions are recorded on an identified cost
basis.
3. CONTRIBUTIONS/WITHDRAWALS
Transactions in shares were as follows:
SIX MONTHS YEAR ENDED
ENDED 12/31/2006
6/30/2007
Proceeds from contributions 77,881 3,664,540
Fair value of withdrawals - (499,900 )
NET CHANGE RESULTING FROM CONTRIBUTIONS/WITHDRAWALS 77,881 3,164,640
4. FEDERAL TAX INFORMATION
At June 30, 2007, the cost of investments for federal tax purposes was
$48,323,414. The net unrealized depreciation of investments for federal tax
purposes excluding any unrealized depreciation from futures contracts and swap
contracts was $36,225. This consists of net unrealized appreciation from
investments for those securities having an excess of value over cost of $54,295
and net unrealized depreciation from investments for those securities having an
excess of cost over value of $90,520.
5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISER FEE
Federated Investment Counseling is the Fund's investment adviser (the
"Adviser"), subject to the oversight of the Directors. The Adviser provides
investment adviser services at no fee. The Adviser may voluntarily choose to
reimburse certain operating expenses of the Fund. The Adviser can modify or
terminate this voluntary reimbursement at any time at its sole discretion. For
the six months ended June 30, 2007, the Adviser voluntarily reimbursed $57,187
of other operating expenses.
ADMINISTRATIVE FEE
Federated Administrative Services, Inc. (FASI), under the Administrative
Services Agreement, provides the Fund with administrative personnel and
services. The fee paid to FASI is based on the average aggregate daily net
assets of the Trust as specified below:
AVERAGE AGGREGATE DAILY NET ASSETS
ADMINISTRATIVE FEE OF THE TRUST
0.150% on the first $5 billion
0.125% on the next $5 billion
0.100% on the next $10 billion
0.075% on assets in excess of $20 billion
The administrative fee received during any fiscal year shall be at least
$150,000 per portfolio. FASI may voluntarily choose to waive any portion of its
fee. FASI can modify or terminate this voluntary waiver at any time at its sole
discretion. For the six months ended June 30, 2007, FASI waived its entire fee.
GENERAL
Certain of the Officers and Directors of the Fund are Officers and Directors or
Trustees of the above companies.
TRANSACTIONS WITH AFFILIATED COMPANIES
Affiliated holdings are mutual funds which are managed by the Adviser or an
affiliate of the Adviser. Transactions with the affiliated company during the
six months ended June 30, 2007 are as follows:
AFFILIATE BALANCE OF PURCHASES/ SALES/ BALANCE OF VALUE DIVIDEND
SHARES HELD ADDITIONS REDUCTIONS SHARES HELD INCOME
12/31/2006 6/30/2007
Prime Value Obligations Fund, - 19,497,520 14,946,912 4,550,608 $4,550,608 $53,007
Institutional Shares
6. INVESTMENT TRANSACTIONS
Purchases and sales of investments, excluding long-term U.S. government
securities and short-term obligations, for the six months ended June 30, 2007,
were as follows:
Purchases $ 89,671,916
Sales $ 86,103,529
7. LINE OF CREDIT
The Fund participates in a $150,000,000 unsecured, uncommitted revolving line of
credit (LOC) agreement with PNC Bank. The LOC was made available for
extraordinary or emergency purposes, primarily for financing redemption
payments. Borrowings are charged interest at a rate of 0.65% over the federal
funds rate. As of June 30, 2007, there were no outstanding loans. During the six
months ended June 30, 2007, the Fund did not utilize the LOC.
8. INTERFUND LENDING
Pursuant to an Exemptive Order issued by the Securities and Exchange Commission
(SEC), the Fund, along with all 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 funds to borrow from other
participating affiliated funds.
As of June 30, 2007, there were no outstanding loans. During the six months
ended June 30, 2007, the program was not utilized.
9. LEGAL PROCEEDINGS
Beginning in October 2003, Federated Investors, Inc. and various subsidiaries
thereof (including the advisers and distributor for various investment
companies, collectively, "Federated"), along with various investment companies
sponsored by Federated ("Funds") were named as defendants in several class
action lawsuits now pending in the United States District Court for the District
of Maryland. The lawsuits were purportedly filed on behalf of people who
purchased, owned and/or redeemed shares of Federated-sponsored mutual funds
during specified periods beginning November 1, 1998. The suits are generally
similar in alleging that Federated engaged in illegal and improper trading
practices including market timing and late trading in concert with certain
institutional traders, which allegedly caused financial injury to the mutual
fund shareholders. These lawsuits began to be filed shortly after Federated's
first public announcement that it had received requests for information on
shareholder trading activities in the Funds from the SEC, the Office of the New
York State Attorney General ("NYAG"), and other authorities. In that regard, on
November 28, 2005, Federated announced that it had reached final settlements
with the SEC and the NYAG with respect to those matters. As Federated previously
reported in 2004, it has already paid approximately $8.0 million to certain
funds as determined by an independent consultant. As part of these settlements,
Federated agreed to pay for the benefit of fund shareholders additional
disgorgement and a civil money penalty in the aggregate amount of an additional
$72 million. Federated and various Funds have also been named as defendants in
several additional lawsuits, the majority of which are now pending in the United
States District Court for the Western District of Pennsylvania, alleging, among
other things, excessive advisory and Rule 12b-1 fees. The Board of the Funds has
retained the law firm of Dickstein Shapiro LLP to represent the Funds in these
lawsuits. Federated and the Funds, and their respective counsel, are reviewing
the allegations and intend to defend this litigation. Additional lawsuits based
upon similar allegations may be filed in the future. The potential impact of
these lawsuits, all of which seek unquantified damages, attorneys' fees and
expenses, and future potential similar suits is uncertain. Although we do not
believe that these lawsuits will have a material adverse effect on the Funds,
there can be no assurance that these suits, the ongoing adverse publicity and/or
other developments resulting from the regulatory investigations will not result
in increased Fund redemptions, reduced sales of Fund shares, or other adverse
consequences for the Funds.
10. RECENT ACCOUNTING PRONOUNCEMENTS
In September 2006, FASB released Statement on Financial Accounting Standards No.
157, "Fair Value Measurements" (FAS 157) which is effective for fiscal years
beginning after November 15, 2007. FAS 157 defines fair value, establishes a
framework for measuring fair value and expands disclosures about fair value
measurements. Management is currently evaluating the impact the adoption of FAS
157 will have on the Fund's financial statement disclosures.
EVALUATION AND APPROVAL OF ADVISORY CONTRACT
MARKET PLUS CORE FUND (THE "FUND")
The Fund's Board reviewed the Fund's investment advisory contract at meetings
held in May 2007. The Board's decision regarding the contract reflects the
exercise of its business judgment on whether to continue the existing
arrangements. The Fund is distinctive in that it is designed for the efficient
management of a particular asset class and is made available for investment only
to other Federated funds and a limited number of other accredited investors. In
addition, the Adviser does not charge an investment advisory fee for its
services although it or its affiliates may receive compensation for managing
assets invested in the Fund.
The Federated funds 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 Board considered
that evaluation, along with other information, in deciding to approve the
advisory contract.
As previously noted, the Adviser does not charge an investment advisory fee for
its services; however, the Board did consider compensation and benefits received
by the Adviser, including fees received for services provided to the Fund by
other entities in the Federated organization and research services received by
the Adviser from brokers that execute Federated fund trades. 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 costs 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 from supplying such
services. The Board was aware of these factors and was guided by them in its
review of the Fund's advisory contract 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 the advice of 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 reports in connection with the particular meeting at which the
Board's formal review of the advisory contract occurred. Between regularly
scheduled meetings, the Board has received information on particular matters as
the need arose. Thus, the Board's consideration of the advisory contract
included review of the Senior Officer's evaluation, accompanying data and
additional reports covering such matters as: the Adviser's investment
philosophy, personnel and processes; investment and operating strategies; the
Fund's short- and long-term performance, and comments on the reasons for
performance; the Fund's investment objectives; the Fund's overall expense
structure; 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 and its
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 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 and the
Federated companies that service them (including communications from regulatory
agencies), as well as Federated's responses to any issues raised therein; and
relevant developments in 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.
Because the Adviser does not charge the Fund an investment advisory fee the
Fund's Board does not consider fee comparisons to other mutual funds or other
institutional or separate accounts to be relevant.
The Board also received financial information about Federated, including reports
on the compensation and benefits Federated derived from its relationships with
the Federated funds. Because the Adviser does not charge an investment advisory
fee for its services, these reports generally cover 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 reports
also discussed 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 waive non-advisory fees
and/or reimburse other expenses and have disclosed to fund investors and/or
indicated to the Board their intention to do so in the future, where
appropriate.
The Board and the Senior Officer also reviewed a report compiled by Federated
comparing profitability information for Federated 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
profit margins did not appear to be excessive and the Board agreed.
The Board based its decision to approve the advisory contract 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. In particular, due to the unusual nature of the Fund
as primarily an internal product with no advisory fee, the Board does not
consider the assessment of whether economies of scale would be realized if the
Fund were to grow to some sufficient size to be relevant. 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 arrangement.
VOTING 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 the EDGAR database on the SEC's
website at www.sec.gov.
QUARTERLY PORTFOLIO SCHEDULE
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.)
Mutual 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.
Cusip 31409R300
35316 (8/07)
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
Not Applicable
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 last fiscal
quarter that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
ITEM 12. EXHIBITS
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 CORE TRUST II, L.P.
BY /S/ RICHARD A. NOVAK
(INSERT NAME AND TITLE)
RICHARD A. NOVAK, PRINCIPAL FINANCIAL OFFICER
DATE AUGUST 21, 2007
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 AUGUST 21, 2007
BY /S/ RICHARD A. NOVAK
RICHARD A. NOVAK, PRINCIPAL FINANCIAL OFFICER
DATE AUGUST 21, 2007