Federated’s assets rose 31% in the final five months of 2008, from $271.1 billion on June 30 to $355.7 billion at year’s end. During the whole year, the firm’s money market funds took in $110 billion.

Analysts say Federated’s money market funds put it in a strong position, which is one of the reasons the firm’s stock is up 30% so far this year.

“When you look at their mutual fund revenues, they’re better positioned than at any time since they went public in 1998,” Keefe Bruyette & Woods Analyst Rob Lee told MarketWatch. “They’re benefiting from the breadth and performance of their products. They’re a relatively defensive name. It’s a firm with solid management.”

And despite the risk that once the market turns around, the money in Federated’s money market funds could go back out the door, CEO Chris Donahue thinks the money will, instead, be sticky. “Once people come in, they realize that money market funds aren’t just parking places but cash-management vehicles. So we think the lion’s share of new assets will stay with us.”

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