Federated Hermes Adjustable Rate Fund Class A is a mutual fund focused on short-duration, fixed-income securities. Its primary objective is to preserve capital and provide income by concentrating on adjustable and floating-rate instruments, with a policy to invest at least 80% of assets in such securities and at least 65% in U.S. government–backed holdings. The portfolio is predominantly composed of mortgage-related securities issued or guaranteed by agencies such as the Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, and Government National Mortgage Association, complemented by cash equivalents and short Treasuries. This structure positions the fund within the short government category, emphasizing high credit quality with limited interest-rate sensitivity and an effective duration near the low end of the spectrum. Established in 1985, the strategy’s benchmark exposure and design seek steady income with minimal principal volatility through rate-resetting coupons that adjust with market conditions. The fund distributes income regularly and maintains an expense profile consistent with its category, reflecting a conservative approach to liquidity and rate management in the U.S. fixed-income market.
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