- 5-star (Morningstar) fund to be made available to investors across European and wider international markets
- Uses MDT’s bottom-up quantitative approach developed over more than 30 years
- Investment team harnesses AI-powered investment model developed over decades
Federated Hermes, Inc. (NYSE:FHI), a global leader in active investment management, is launching the Federated Hermes MDT US Equity Fund, a UCITS version of its 5-star US domiciled Federated Hermes MDT All Cap Core (40 ACT) fund.
The Fund will make use of MDT’s bottom-up quantitative approach, and will follow an all-cap, all-style approach, selecting stocks from within the Russell 3000 Index. The actively managed, Dublin-domiciled, Fund seeks to provide investors with long term capital growth by using sophisticated modelling techniques that harness machine learning to identify opportunities. The process sees stock forecasts and portfolio positions updated daily, allowing the strategy to adapt to markets, following a pre-trade review by the portfolio management team.
With an overall 5-star Morningstar rating for the US domiciled mutual fund, the UCITS fund benefits from MDT’s track record of managing the strategy successfully in the US for over 30 years, through various market cycles, as the MDT team continuously evaluate and evolve every element of their investment process.
The Fund managed by Daniel Mahr, Head of MDT and supported by Frederick Konopka, John Paul Lewicke and Damien Zhang, benchmarks against the Russell 3000 index, which represents approximately 98% of the US domestic equity market. This expanded universe allows for a greater breadth of alpha enhancing opportunities from across the market cap spectrum. MDT’s All Cap Core strategy has outperformed both the Russell 3000 and S&P 500 over YTD, 1 year, 3 year, 5 years, and 10 years1, all while carrying an underweight to the collection of major index constituents commonly known as the ‘Magnificent Seven’ over recent years.
This marks the 16th strategy launched since Federated’s acquisition of the Hermes business in 2018, as it continues to enhance its capabilities bringing best of breed products to European and international investors, from its US stable of products.
The MDT US Equity fund is a fund for all seasons. Our long-term returns demonstrate it’s not the direction of the benchmark that matters, as the strategy has proved to be robust in different market environments. Our strategies hold many different companies and company types, helping to diversify its alpha sources and provide additional diversification through the cycle when one particular factor or type of company is out of favour.
Daniel Mahr, Head of MDT Group at Federated Hermes
Our MDT strategies take a supervised, yet disciplined approach that resonates with our client base. MDT has a lengthy track record deploying a differentiated machine learning model, which has been able to deliver a repeatable process to the financial benefit of our clients. We are excited to provide international investors exposure to the US equities markets through these award-winning strategies.
Clive Selman, Head of International Sales at Federated Hermes Limited
The Federated Hermes MDT US Equity Fund is Dublin domiciled and registered for sale in the UK. Other international registrations (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden and Singapore) to follow.
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1 Past performance is not a reliable indicator of future performance. Performance is on a net of fees basis in USD. Management fees are not included and will have the effect of reducing performance. The Fund is classified under Article 8 of the EU’s Sustainable Finance Disclosure Regulation (SFDR).
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