Federated Investors announced Monday that it will add a new share class on two of its ultrashort funds and rename another, making it the only fund complex to offer a full line of ultrashort products.
The firm said it would introduce A shares to the Federated Government Ultrashort Fund, which will now be known as the Federated Government Ultrashort Duration Fund. Federated also converted the Federated Municipal Ultrashort Funds Institutional Service Shares to A shares. The objective of developing these products is to limit price fluctuation by investing in high-quality, short-term debt instruments, while offering investors the potential for far greater yields than money market funds, the company said.
"By taking a short step out on the yield curve, our three ultrashort funds occupy a niche area of the curve," said William Dawson, chief investment officer of its global fixed income group. "This short step, coupled with the funds more flexible investment parameters, enables Federateds portfolio managers to pursue greater yield potential compared to money market funds."
Federated manages $195 million in assets, including 135 mutual funds, various separately managed accounts and closed-end funds.