The Federated Prudent Bear Fund is the successor to the Prudent Bear Fund, pursuant to a reorganization that took place on December 5, 2008. Prior to that date, the Federated Prudent Bear Fund had no investment operations. Accordingly, performance information shown for periods prior to December 5, 2008, is historical information for the former No Load Shares but has been adjusted to reflect the maximum sales charges and expenses applicable to the fund’s Class A and C Shares.
Diversification does not assure a profit nor protect against loss.
Federated Prudent Bear Fund regularly makes short sales of securities, which involves unlimited risk including the possibility that losses may exceed the original amount invested. The fund may also use options and
future contracts, which have risks associated with unlimited losses of the underlying holdings due to unanticipated market movements and failure to correctly predict the direction of securities prices, interest rates and currency exchange rates. However, a mutual fund investor’s risk is limited to one’s amount of investment in a mutual fund. The fund may also hold restricted securities purchased through private placements. Such securities may be difficult to sell without experiencing delays or additional costs. Please see the prospectus for further details. Considering the increased risks, the fund may not be suitable for all investors.
Investments in gold and precious metals are subject to additional risks such as the possibility of substantial price fluctuations over a short period of time.