485BPOS

1933 Act File No.	33-41004
1940 Act File No.	811-6307

Form N-1A

SECURITIES AND EXCHANGE COMMISSION

Washington, DC  20549

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
	Pre-Effective Amendment No.
	Post-Effective Amendment No.	28
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
	Amendment No.	25

FEDERATED INTERMEDIATE GOVERNMENT FUND, INC.

(Exact Name of Registrant as Specified in Charter)

Federated Investors Funds

4000 Ericsson Drive

Warrendale, PA 15086-7561

 (Address of Principal Executive Offices)

(412) 288-1900

 (Registrant’s Telephone Number, including Area Code)

John W. McGonigle, Esquire

Federated Investors Tower

Pittsburgh, Pennsylvania  15222-3779

 (Name and Address of Agent for Service)

It is proposed that this filing will become effective (check appropriate box):
	immediately upon filing pursuant to paragraph (b)
x	on	April 28, 2011	pursuant to paragraph (b)
	60 days after filing pursuant to paragraph (a)(1)
	on		pursuant to paragraph (a)(1)
	75 days after filing pursuant to paragraph (a)(2)
	on		pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
	This post-effective amendment designates a new effective date for a previously filed post-effective amendment.

Federated Intermediate Government Fund, Inc.

PROSPECTUS

April 30, 2011

The information contained herein relates to all classes of the Fund's Shares, as listed below, unless otherwise noted.

INSTITUTIONAL SHARES (TICKER FLDIX)
INSTITUTIONAL SERVICE SHARES (TICKER FLDSX)

A mutual fund seeking to provide total return by investing primarily in U.S. government and government agency securities, including mortgage-backed securities issued by U.S. government agencies and instrumentalities.

As with all mutual funds, the Securities and Exchange Commission (SEC) has not approved or disapproved these securities or passed upon the adequacy of this Prospectus. Any representation to the contrary is a criminal offense.

Contents

Fund Summary Information	1
What are the Fund's Investment Strategies?	6
What are the Fund's Principal Investments?	7
What are the Specific Risks of Investing in the Fund?	10
What Do Shares Cost?	12
How is the Fund Sold?	15
Payments to Financial Intermediaries	16
How to Purchase Shares	17
How to Redeem and Exchange Shares	20
Account and Share Information	23
Who Manages the Fund?	25
Legal Proceedings	26
Financial Information	27
Appendix A: Hypothetical Investment and Expense Information	30

Fund Summary Information

Federated Intermediate Government Fund, Inc. (the “Fund”)

RISK/RETURN SUMMARY: INVESTMENT OBJECTIVE

The Fund's investment objective is to provide total return.

RISK/RETURN SUMMARY: FEES AND EXPENSES

This table describes the fees and expenses that you may pay if you buy and hold the Fund's Institutional Shares (IS) and Institutional Service Shares (SS).

Shareholder Fees (fees paid directly from your investment)	IS	SS
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price)	None	None
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, as applicable)	None	None
Maximum Sales Charge (Load) Imposed on Reinvested Dividends (and other Distributions) (as a percentage of offering price)	None	None
Redemption Fee (as a percentage of amount redeemed, if applicable)	None	None
Exchange Fee	None	None
Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment)
Management Fee	0.40%	0.40%
Distribution (12b-1) Fee	None	0.05%
Other Expenses	1.89%	1.89%
Acquired Fund Fees and Expenses	0.01%	0.01%
Total Annual Fund Operating Expenses	2.30%	2.35%
Fee Waivers and/or Expense Reimbursements1	1.99%	1.79%
Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements	0.31%	0.56%

1 The Adviser and its affiliates have voluntarily agreed to waive their fees and/or reimburse expenses so that the total annual fund operating expenses (excluding Acquired Fund Fees and Expenses) paid by the Fund's IS and SS classes (after the voluntary waivers and/or reimbursements) will not exceed 0.30% and 55% (the “Fee Limit”), respectively, up to but not including the later of (the “Termination Date”): (a) May 1, 2012; or (b) the date of the Fund's next effective Prospectus. While the Adviser and its affiliates currently do not anticipate terminating or increasing these arrangements prior to the Termination Date, these arrangements may only be terminated or the Fee Limit increased prior to the Termination Date with the agreement of the Fund's Board of Directors.

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Example

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.

The Example assumes that you invest $10,000 for the time periods indicated and then redeem all of your Shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the operating expenses are as shown in the table above and remain the same. Although your actual costs and returns may be higher or lower, based on these assumptions your costs would be:

Share Class	1 Year	3 Years	5 Years	10 Years
IS	$233	$718	$1,230	$2,636
SS	$238	$733	$1,255	$2,686

Portfolio Turnover

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund Shares are held in a taxable account. These costs, which are not reflected in Annual Fund Operating Expenses or in the Example, affect the Fund's performance. During the most recent fiscal year, the Fund's portfolio turnover rate was 49% of the average value of its portfolio.

RISK/RETURN SUMMARY: INVESTMENTS, RISKS and PERFORMANCE

What are the Fund's Main Investment Strategies?

The Fund seeks total return, which is defined as income plus capital appreciation. Under normal market conditions, the Fund invests primarily in Treasury, U.S. government securities, government agency and government agency-backed, mortgage-backed securities (MBS). The Fund will only invest in MBS that are issued or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises (GSEs).

The Fund typically seeks to maintain an overall average dollar-weighted portfolio duration that is within 20% above or 50% below the Barclays Capital Intermediate Government Index (the “Index”). At times, the Adviser's calculation of portfolio duration may result in variances outside this range. Duration is a measure of the price volatility of a fixed-income security as a result of changes in market rates of interest, based on the weighted average timing of the instrument's expected fixed interest and principal payments. The Adviser seeks to create a portfolio, consisting of U.S. Government securities, MBS, derivative instruments and other securities, that outperform the Index.

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Based on fundamental analysis, the Adviser will consider a variety of factors when making decisions to purchase or sell particular securities or derivative contracts. The Fund may, but is not required to, use derivative instruments, which are instruments that have a value based on another instrument, exchange rate or index, and may be used as substitutes for securities in which the Fund can invest, or to hedge against a potential loss in the underlying asset. There can be no assurance that the Fund's use of derivative instruments will work as intended.

What are the Main Risks of Investing in the Fund?

All mutual funds take investment risks. Therefore, it is possible to lose money by investing in the Fund. The primary factors that may reduce the Fund's returns include:

• MBS Risks. A rise in interest rates may cause the value of MBS held by the Fund to decline. Certain MBS issued by GSEs are not backed by the full faith and credit of the U.S. government. The Fund's investments in collateralized mortgage obligations (CMOs) may entail greater market, prepayment and liquidity risks than other MBS.
• Interest Rate Risks. Prices of fixed-income securities generally fall when interest rates rise.
• Prepayment Risks. When homeowners prepay their mortgages in response to lower interest rates, the Fund will be required to reinvest the proceeds at the lower interest rates available. Also, when interest rates fall, the prices of MBS may not rise to as great an extent as those of other fixed-income securities due to the potential prepayment of higher interest mortgages.
• Liquidity Risks. The CMOs in which the Fund invests may be less readily marketable and may be subject to greater fluctuation in price than other securities.
• Leverage Risks. Leverage risk is created when an investment exposes the Fund to a level of risk that exceeds the amount invested. Changes in the value of such an investment magnify the Fund's risk of loss and potential for gain.
• Risks of Investing in Derivative Instruments. The Fund's exposure to derivative contracts and hybrid instruments (either directly or through its investment in another investment company) involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. The use of derivatives can lead to losses because of adverse movements in the price or value of the asset, index, rate or instrument underlying a derivative, due to failure of a counterparty, or the failure of the counterparty to meet its obligations under the contract, or due to tax or regulatory constraints. Derivatives may create investment leverage in the Fund, which magnifies the Fund's exposure to the underlying investment. Derivative instruments may be difficult to value, may be illiquid and may be subject to wide swings in valuation caused by changes in the value of the underlying instrument. Over-the-counter derivative contracts generally carry greater liquidity risk than exchange-traded contracts. The loss on derivative transactions may substantially exceed the initial investment.

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• Asset Segregation Risks. The requirement to secure its obligations in connection with certain transactions, including derivatives or other transactions that expose it to an obligation of another party, by owning underlying assets, entering into offsetting transactions or setting aside cash or liquid assets, may cause the Fund to miss favorable trading opportunities, or to realize losses on such offsetting transactions.

The Shares offered by this Prospectus are not deposits or obligations of any bank, are not endorsed or guaranteed by any bank and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency.

Performance: Bar Chart and Table

Risk/Return Bar Chart

The bar chart and performance table below reflect historical performance data for the Fund and are intended to help you analyze the Fund's investment risks in light of its historical returns. The bar chart shows the variability of the Fund's IS class total returns on a calendar year-by-year basis. The Average Annual Total Return table shows returns for each class averaged over the stated periods, and includes comparative performance information. The Fund's performance will fluctuate, and past performance (before and after taxes) is not necessarily an indication of future results. Updated performance information for the Fund is available under the “Products” section at FederatedInvestors.com or by calling 1-800-341-7400.

The Fund's IS class total return for the three-month period from January 1, 2011 to March 31, 2011, was 0.11%.

Within the periods shown in the bar chart, the Fund's IS class highest quarterly return was 3.77% (quarter ended December 31, 2008). Its lowest quarterly return was (1.49)% (quarter ended December 31, 2010).

Average Annual Total Return Table

In addition to Return Before Taxes, Return After Taxes is shown for the Fund's IS class to illustrate the effect of federal taxes on Fund returns. After-tax returns are shown only for the IS class, and after-tax returns for the SS class will differ from those shown for the IS class. Actual after-tax returns depend on each

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investor's personal tax situation, and are likely to differ from those shown. After-tax returns are calculated using a standard set of assumptions. The stated returns assume the highest historical federal income and capital gains tax rates. These after-tax returns do not reflect the effect of any applicable state and local taxes. After-tax returns are not relevant to investors holding Shares through a 401(k) plan, an Individual Retirement Account (IRA) or other tax-advantaged investment plan.

(For the Period Ended December 31, 2010)

	1 Year	5 Years	10 Years
Share Class
IS:
Return Before Taxes	4.50%	4.89%	4.15%
Return After Taxes on Distributions	3.90%	3.60%	2.85%
Return After Taxes on Distributions and Sale of Fund Shares	2.93%	3.42%	2.77%
SS:
Return Before Taxes	4.29%	4.66%	3.91%
Barclays Capital Intermediate Government Index1 (reflects no deduction for fees, expenses or taxes)	5.89%	5.53%	5.51%

1 Barclays Capital Intermediate Government Index is an unmanaged index comprised of all publicly issued, non-convertible domestic debt of the U.S. government or any agency thereof, or any quasi-federal corporation and of corporate debt guaranteed by the U.S. government. Only notes and bonds with minimum outstanding principal of $1 million and minimum maturity of one year and maximum maturity of ten years are included.

FUND MANAGEMENT

The Fund's Investment Adviser (“Adviser”) is Federated Investment Management Company.

Liam O'Connell, Portfolio Manager, has been the Fund's portfolio manager since June 2005.

purchase and sale of fund shares

You may purchase, redeem or exchange Shares of the Fund on any day the New York Stock Exchange (NYSE) is open. Shares may be purchased through a financial intermediary or directly from the Fund, by wire or by check. Please note that certain purchase restrictions may apply. Redeem or exchange Shares through a financial intermediary or directly from the Fund by telephone at 1-800-341-7400 or by mail.

The minimum initial investment amount for the Fund's IS and SS classes is generally $1,000,000 and there is no required minimum subsequent investment amount.

Tax Information

The Fund's distributions are taxable as ordinary income or capital gains except when your investment is through a 401(k) plan, an IRA or other tax-advantaged investment plan.

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Payments to Broker-Dealers and Other Financial Intermediaries

If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and/or its related companies may pay the intermediary for the sale of Fund Shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

What are the Fund's Investment Strategies?

A statement of the Fund's investment objective and principal investment strategies and risks is set forth above in the Fund's Risk/Return Summary. There can be no assurances that the Fund will achieve its investment objective or that the investment strategies used by the Adviser will be successful.

The Fund seeks total return, which is defined as income plus capital appreciation. Under normal market conditions, the Fund invests primarily in Treasury, U.S. government agency securities and U.S. government agency-backed, mortgage-backed securities (MBS). The Fund will only invest in MBS that are issued or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises (GSEs). The Fund also may invest in U.S. government securities and certain derivative instruments.

The Fund typically seeks to maintain an overall average dollar-weighted portfolio duration that is within 20% above or 50% below the Barclays Capital Intermediate Government Index (the “Index”). At times, the Adviser's calculation of portfolio duration may result in variances outside this range. Duration is a measure of the price volatility of a fixed-income security as a result of changes in market rates of interest, based on the weighted average timing of the instrument's expected fixed interest and principal payments. For example, if interest rates rise by 1% (in a parallel shift) the NAV of a fund with an average duration of five years theoretically would decline about 5.0%. Securities with longer durations tend to be more sensitive to interest rate changes than securities with shorter durations.

The Adviser seeks to create a portfolio, consisting of U.S. government securities, MBS, derivative instruments and other securities, that outperforms the Index. In implementing the Fund's investment strategy, the Adviser typically will take into consideration: (i) overall levels of interest rates; (ii) volatility of interest rates; (iii) relative interest rates of securities with longer and shorter durations (known as a “yield curve”); and (iv) relative interest rates of different types of securities (such as U.S. government securities and MBS).

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Based on fundamental analysis, the Adviser will consider a variety of factors when making decisions to purchase or sell particular securities or derivative contracts, including: the securities' specific interest rate and prepayment risks, and price sensitivity to changes in market spread levels and in the level of interest rate volatility. In analyzing MBS, the Adviser also may consider the average interest rates of the underlying loans, the prior and expected prepayments.

The Fund may, but is not required to, use derivative instruments, which are instruments that have a value based on another instrument, exchange rate or index, and may be used as substitutes for securities in which the Fund can invest, or to hedge against a potential loss in the underlying asset. The Fund may use futures contracts, options, options on futures (including those relating to interest rates) and swaps as tools in the management of portfolio assets, or other elements of its investment strategy. There can be no assurance that the Fund's use of derivative instruments will work as intended.

Because the Fund refers to U.S. government securities in its name, it will notify shareholders at least 60 days in advance of any change in its investment policies that would enable the Fund to invest, under normal circumstances, less than 80% of its assets in U.S. government investments.

Portfolio Turnover

The Fund actively trades its portfolio securities in an attempt to achieve its investment objective. Active trading will cause the Fund to have an increased portfolio turnover rate, which is likely to generate shorter-term gains (losses) for its shareholders, which are taxed at a higher rate than longer-term gains (losses). Actively trading portfolio securities increases the Fund's trading costs and may have an adverse impact on the Fund's performance.

Temporary Investments

The Fund may temporarily depart from its principal investment strategies by investing its assets in shorter-term debt securities and similar obligations or by holding cash. It may do this in response to unusual circumstances, such as: adverse market, economic or other conditions (for example, to help avoid potential losses or during periods when there is a shortage of appropriate securities); to maintain liquidity to meet shareholder redemptions; or to accommodate cash inflows. It is possible that such investments could affect the Fund's investment returns and/or the ability to achieve the Fund's investment objectives.

What are the Fund's Principal Investments?

The following provides general information on the Fund's principal investments. The Fund's Statement of Additional Information (SAI) provides information about the Fund's non-principal investments and may provide additional information about the Fund's principal investments.

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Fixed-Income Securities

The Fund may invest in the fixed-income securities described below. The Fund's fixed-income investments may include bonds, notes (including structured notes), mortgage-related securities and money market instruments. Fixed-income securities may be issued by: the U.S. government, its agencies, authorities, instrumentalities or GSEs. These securities may have all types of interest rate payment and reset terms, including fixed rate, adjustable rate and zero coupon.

U.S. Government Securities

U.S. government securities include U.S. Treasury obligations, which differ in their yields, maturities and times of issuance, and obligations issued or guaranteed by U.S. government agencies or instrumentalities (“agency obligations”). Agency obligations may be guaranteed by the U.S. government or they may be backed by the right of the issuer to borrow from the U.S. Treasury, the discretionary authority of the U.S. government to purchase the obligations, or the credit of the agency or instrumentality. As a result of their high credit quality and market liquidity, U.S. government securities generally provide lower current yields than obligations of other issuers. While certain U.S. government-sponsored enterprises (such as the Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association) may be chartered or sponsored by acts of Congress, their securities are neither issued nor guaranteed by the U.S. Treasury.

Mortgage-Backed Securities (MBS) (A Fixed-Income Security)

An MBS is a type of pass-through security, which is a pooled debt obligation repackaged as interests that pass principal and interest through an intermediary to investors. In the case of MBS, the ownership interest is in a pool of mortgage loans. MBS represent participation interests in pools of adjustable and fixed-rate mortgage loans. The Fund will only invest in MBS that are issued or guaranteed by U.S. government agencies. Unlike conventional debt obligations, MBS provide monthly payments derived from the monthly interest and principal payments (including any prepayments) made by the individual borrowers on the pooled mortgage loans.

The MBS acquired by the Fund could be secured by fixed-rate mortgages, adjustable-rate mortgages or hybrid adjustable-rate mortgages. Adjustable-rate mortgages are mortgages whose interest rates are periodically reset when market rates change. A hybrid adjustable-rate mortgage (“hybrid ARM”) is a type of mortgage in which the interest rate is fixed for a specified period and then resets periodically, or floats, for the remaining mortgage term. Hybrid ARMs are usually referred to by their fixed and floating periods. For example, a “5/1 ARM” refers to a mortgage with a five-year, fixed interest rate period, followed by 25 annual interest rate adjustment periods.

The Fund also may invest in collateralized mortgage obligations (CMOs). CMOs are issued in multiple classes, often referred to as “tranches,” with each tranche having a specific fixed or floating coupon rate, and stated maturity or final distribution date. CMOs are subject to the uncertainty of the timing of cash flows that results from the rate of prepayments on the underlying mortgages

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serving as collateral and from the structure of the particular CMO transaction (that is, the priority of the individual tranches). An increase or decrease in prepayment rates (resulting from a decrease or increase in mortgage interest rates) may cause the CMOs to be retired substantially earlier or later than their stated maturities or final distribution dates, and will affect the yields and prices of CMOs.

Mortgage dollar rolls are transactions in which the Fund sells MBS for delivery in the current month with a simultaneous contract entered to repurchase substantially similar (same type, coupon and maturity) securities on a specified future date and price (a “mortgage roll”). During the roll period, the Fund foregoes principal and interest paid on the MBS. Mortgage dollar roll transactions may be used to seek to increase the Fund's income. The Fund uses repurchase agreements to secure its obligations in these transactions.

Repurchase Agreements (A Fixed-Income Security)

Repurchase agreements are transactions in which the Fund buys a security from a dealer or bank and agrees to sell the security back at a mutually agreed-upon time and price. The repurchase price exceeds the sale price, reflecting the Fund's return on the transaction. This return is unrelated to the interest rate on the underlying security. The Fund will enter into repurchase agreements only with banks and other recognized financial institutions, such as securities dealers, deemed creditworthy by the Adviser.

The Fund's custodian or subcustodian will take possession of the securities subject to repurchase agreements. The Adviser or subcustodian will monitor the value of the underlying security each day to ensure that the value of the security always equals or exceeds the repurchase price.

Repurchase agreements are subject to credit risks. The Fund invests in overnight repurchase agreements in order to maintain sufficient cash to pay for daily net redemptions and portfolio transactions. The Fund uses repurchase agreements to secure its obligations in connection with dollar roll transactions.

Derivative INSTRUMENTS

The Fund may enter into derivatives transactions with respect to any security or other instrument in which it is permitted to invest, or any related security, instrument, index or economic indicator (“reference instruments”). Derivatives are financial instruments the value of which is derived from the underlying reference instrument. Derivatives may allow the Fund to increase or decrease the level of risk to which the Fund is exposed more quickly and efficiently than transactions in other types of instruments. The Fund incurs costs in connection with opening and closing derivatives positions.

The Fund may engage in transactions in futures contracts and options on futures contracts. Futures are standardized, exchange-traded contracts that obligate a purchaser to take delivery, and a seller to make delivery, of a specific amount of an asset at a specified future date at a specified price. Futures contracts involve substantial leverage risk. The Fund also is authorized to purchase or sell call and put options on futures contracts. The Fund can buy or sell financial

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futures (such as interest rate futures, index futures and security futures). The primary risks associated with the use of futures contracts and options are imperfect correlation, liquidity, unanticipated market movement and counterparty risk. The Fund also may enter into other derivative transactions with substantially similar characteristics and risks or over-the-counter derivatives such as interest rate swaps, caps and floors and options or other instruments.

What are the Specific Risks of Investing in the Fund?

The following provides general information on the risks associated with the Fund's principal investments. The Fund may invest in other types of securities or investments as non-principal investments. Any additional risks associated with investing in such other non-principal investments are described in the Fund's SAI. The Fund's SAI also may provide additional information about the risks associated with the Fund's principal investments.

MBS RISKS

MBS have unique risks. A rise in interest rates may cause the value of MBS held by the Fund to decline. The mortgage loans underlying MBS generally are subject to a greater rate of principal prepayments in a declining interest rate environment and to a lesser rate of principal prepayments in an increasing interest rate environment. If the underlying mortgages are paid off sooner than expected, the Fund may have to reinvest this money in mortgage-backed or other securities that have lower yields. See “Prepayment Risks.” The Fund only invests in MBS issued or guaranteed by the U.S. government or government agency. Certain MBS issued by GSEs are not backed by the full faith and credit of the U.S. government, but are, however, supported through federal subsidies, loans or other benefits. The Fund also may invest in certain MBS issued by GSEs that have no explicit financial support, but that are regarded as having implied support because the federal government sponsors their activities.

Hybrid ARMs also involve special risks. Like ARMs, hybrid ARMs have periodic and lifetime limitations on the increases that can be made to the interest rates that mortgagors pay. Therefore, if during a floating rate period, interest rates rise above the interest rate limits of the hybrid ARM, the Fund will not benefit from further increases in interest rates. CMOs with complex or highly variable prepayment terms generally entail greater market, prepayment and liquidity risks than other MBS. For example, their prices are more volatile and their trading market may be more limited.

INTEREST RATE RISKS

Prices of fixed-income securities rise and fall in response to interest rate changes in the interest paid by similar securities. Generally, when interest rates rise, prices of fixed-income securities fall. However, market factors, such as the demand for particular fixed-income securities, may cause the prices of certain fixed-income securities to fall while the prices of other securities rise or remain unchanged. Interest rate changes have a greater effect on the prices of fixed-income securities with longer durations.

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PREPAYMENT RISKS

Unlike traditional fixed-income securities, which pay a fixed rate of interest until maturity (when the entire principal amount is due), payments on MBS include both interest and a partial payment of principal. Partial payment of principal may be comprised of scheduled principal payments, as well as unscheduled payments from the voluntary prepayment, refinancing or foreclosure of the underlying loans. These unscheduled prepayments of principal create risks that can adversely affect the Fund's MBS holdings.

The mortgage loans underlying MBS are generally subject to a greater rate of principal prepayments in a declining interest rate environment and to a lesser rate of principal prepayments in a rising interest rate environment. Under certain interest and prepayment rate scenarios, the Fund may fail to recover the full amount of its investment in MBS, notwithstanding any direct or indirect governmental or agency guarantee. Because faster-than-expected prepayments typically are invested in lower yielding securities, MBS are less effective than conventional bonds in “locking in” a specified yield rate. For premium bonds, prepayment risk may be elevated. In a rising interest rate environment, a declining prepayment rate will extend the average life of many MBS. This possibility is often referred to as extension risk. Extending the average life of an MBS increases the risk of depreciation due to future increases in market interest rates.

LIQUIDITY RISKS

The secondary market for some securities held by the Fund is less liquid than for more widely traded fixed-income securities. In certain situations, the Fund could find it more difficult to sell such securities at desirable times and/or prices. Liquidity risk also refers to the possibility that the Fund may not be able to sell a security or close out a derivative contract when it wants to. If this happens, the Fund will be required to continue to hold the security or keep the position open, and the Fund could incur losses.

LEVERAGE RISKS

Leverage risk is created when an investment, which includes, for example, an investment in a derivative contract, exposes the Fund to a level of risk that exceeds the amount invested. Changes in the value of such an investment magnify the Fund's risk of loss and potential for gain. Investments can have these same results if their returns are based on a multiple of a specified index, security or other benchmark.

RISKS OF INVESTING IN DERIVATIVE INSTRUMENTS

The Fund's exposure to derivative contracts and hybrid instruments (either directly or through its investment in another investment company) involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. The use of derivatives can lead to losses because of adverse movements in the price or value of the asset, index, rate or instrument underlying a derivative, due to failure of a counterparty, or the

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failure of the counterparty to meets its obligations under the contract, or due to tax or regulatory constraints. Derivatives may create investment leverage in the Fund, which magnifies the Fund's exposure to the underlying investment. Derivative risks may be more significant when derivatives are used to enhance return or as a substitute for a position or security, rather than solely to hedge the risk of a position or security held by the Fund. Derivatives used for hedging purposes may not reduce risk if they are not sufficiently correlated to the position being hedged. A decision as to whether, when and how to use options involves the exercise of specialized skill and judgment, and even a well-conceived transaction may be unsuccessful to some degree because of market behavior or unexpected events. Derivative instruments may be difficult to value, may be illiquid and may be subject to wide swings in valuation caused by changes in the value of the underlying instrument. OTC derivative contracts generally carry greater liquidity risk than exchange-traded contracts. This risk may be increased in times of financial stress, if the trading market for OTC derivative contracts becomes restricted. The loss on derivative transactions may substantially exceed the initial investment.

Asset Segregation RISKS

In order to secure its obligations in connection with derivative contracts or other transactions that expose it to an obligation of another party, the Fund will either own the underlying assets, enter into offsetting transactions or set aside cash or readily marketable securities. This requirement may cause the Fund to miss favorable trading opportunities, due to a lack of sufficient cash or readily marketable securities. This requirement also may cause the Fund to realize losses on offsetting or terminated derivative contracts.

What Do Shares Cost?

CALCULATION OF NET ASSET VALUE

When the Fund receives your transaction request in proper form (as described in this Prospectus), it is processed at the next calculated net asset value of a Share (NAV). A Share's NAV is determined as of the end of regular trading on the New York Stock Exchange (NYSE) (normally 4:00 p.m. Eastern time), each day the NYSE is open. The Fund calculates the NAV of each class by valuing the assets allocated to the Share's class, subtracting the liabilities allocated to the class and dividing the balance by the number of Shares of the class outstanding. The Fund's current NAV and public offering price may be found at FederatedInvestors.com and in the mutual funds section of certain newspapers under “Federated.”

You can purchase, redeem or exchange Shares any day the NYSE is open.

When the Fund holds fixed-income securities that trade on days the NYSE is closed, the value of the Fund's assets may change on days you cannot purchase or redeem Shares.

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In calculating its NAV, the Fund generally values investments as follows:

• Fixed-income securities acquired with remaining maturities greater than 60 days are fair valued using price evaluations provided by a pricing service approved by the Board of Directors (“Board”).
• Fixed-income securities acquired with remaining maturities of 60 days or less are valued at their cost (adjusted for the accretion of any discount or amortization of any premium).
• Derivative contracts listed on exchanges are valued at their reported settlement or closing price, except that options are valued at the mean of closing bid and asked quotations.
• Over-the-counter (OTC) derivative contracts are fair valued using price evaluations provided by a pricing service approved by the Board.

If the Fund cannot obtain a price or price evaluation from a pricing service for an investment, the Fund may attempt to value the investment based upon the mean of bid and asked quotations, or fair value the investment based on price evaluations, from one or more dealers. If any price, quotation, price evaluation or other pricing source is not readily available when the NAV is calculated, the Fund uses the fair value of the investment determined in accordance with the procedures described below. There can be no assurance that the Fund could purchase or sell an investment at the price used to calculate the Fund's NAV.

Shares of other mutual funds are valued based upon their reported NAVs. The prospectuses for these mutual funds explain the circumstances under which they will use fair value pricing and the effects of using fair value pricing.

Fair Valuation and Significant Events Procedures

The Board has ultimate responsibility for determining the fair value of investments for which market quotations are not readily available. The Board has appointed a Valuation Committee comprised of officers of the Fund and of the Adviser to assist in this responsibility and in overseeing the calculation of the NAV. The Board has also authorized the use of pricing services recommended by the Valuation Committee to provide fair value evaluations of the current value of certain investments for purposes of calculating the NAV. In the event that market quotations and price evaluations are not available for an investment, the Valuation Committee determines the fair value of the investment in accordance with procedures adopted by the Board. The Board periodically reviews and approves the fair valuations made by the Valuation Committee and any changes made to the procedures. The Fund's SAI discusses the methods used by pricing services and the Valuation Committee to value investments.

Using fair value to price investments may result in a value that is different from an investment's most recent closing price and from the prices used by other mutual funds to calculate their NAVs. The Valuation Committee generally will not change an investment's fair value in the absence of new information relating to the investment or its issuer, such as changes in the issuer's business or financial

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results, or relating to external market factors, such as trends in the market values of comparable securities. This may result in less frequent, and larger, changes in fair values as compared to prices based on market quotations or price evaluations from pricing services or dealers.

The Board also has adopted procedures requiring an investment to be priced at its fair value whenever the Adviser determines that a significant event affecting the value of the investment has occurred between the time as of which the price of the investment would otherwise be determined and the time as of which the NAV is computed. An event is considered significant if there is both an affirmative expectation that the investment's value will change in response to the event and a reasonable basis for quantifying the resulting change in value. Examples of significant events that may occur after the close of the principal market on which a security is traded, or after the time of a price evaluation provided by a pricing service or a dealer, include:

• With respect to price evaluations of fixed-income securities determined before the close of regular trading on the NYSE, actions by the Federal Reserve Open Market Committee and other significant trends in U.S. fixed-income markets;
• Political or other developments affecting the economy or markets in which an issuer conducts its operations or its securities are traded; and
• Announcements concerning matters such as acquisitions, recapitalizations or litigation developments or a natural disaster affecting the issuer's operations or regulatory changes or market developments affecting the issuer's industry.

The Valuation Committee uses a pricing service to determine the fair value of equity securities traded principally in foreign markets when the Adviser determines that there has been a significant trend in the U.S. equity markets or in index futures trading. For other significant events, the Fund may seek to obtain more current quotations or price evaluations from alternative pricing sources. If a reliable alternative pricing source is not available, the Valuation Committee will determine the fair value of the investment using another method approved by the Board. The Board has ultimate responsibility for any fair valuations made in response to a significant event.

The fair valuation of securities following a significant event can serve to reduce arbitrage opportunities for short-term traders to profit at the expense of long-term investors in the Fund. For example, such arbitrage opportunities may exist when the market on which portfolio securities are traded closes before the Fund calculates its NAV, which is typically the case with Asian and European markets. However, there is no assurance that these significant event procedures will prevent dilution of the NAV by short-term traders. See “Account and Share Information – Frequent Trading Policies” for other procedures the Fund employs to deter such short-term trading.

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How is the Fund Sold?

The Fund offers two Share classes: Institutional Shares (IS) and Institutional Service Shares (SS), each representing interests in a single portfolio of securities. All Share classes have different sales charges and/or other expenses which affect their performance. Please note that certain purchase restrictions may apply.

Under the Distributor's Contract with the Fund, the Distributor, Federated Securities Corp., offers Shares on a continuous, best-efforts basis. The Distributor is a subsidiary of Federated Investors, Inc. (“Federated”).

The Fund's Distributor markets IS and SS classes to Eligible Investors, as described below. In connection with a request to purchase an IS or SS class, you should provide documentation sufficient to verify your status as an Eligible Investor. As a general matter, IS and SS classes are not available for direct investment by natural persons.

The following categories of Eligible Investors are not subject to any minimum initial investment amount for the purchase of IS or SS classes (however, such accounts remain subject to the Fund's policy on “Accounts with Low Balances” as discussed later in this Prospectus):

• An investor participating in a wrap program or other fee-based program sponsored by a financial intermediary;
• An investor participating in a no-load network or platform sponsored by a financial intermediary where Federated has entered into an agreement with the intermediary;
• A trustee/director, employee or former employee of the Fund, the Adviser, the Distributor and their affiliates; an immediate family member of these individuals or a trust, pension or profit-sharing plan for these individuals;
• An employer-sponsored retirement plan;
• A trust institution investing on behalf of its trust customers;
• Additional sales to an investor (including a natural person) who owned IS and/or SS classes of the Fund as of December 31, 2008;
• An investor (including a natural person) who acquired IS and/or SS classes of a Federated fund pursuant to the terms of an agreement and plan of reorganization which permits the investor to acquire such shares; and
• In connection with an acquisition of an investment management or advisory business, or related investment services, products or assets, by Federated or its investment advisory subsidiaries, an investor (including a natural person) who: (1) becomes a client of an investment advisory subsidiary of Federated; or (2) is a shareholder or interest holder of a pooled investment vehicle or product that becomes advised or subadvised by a Federated investment advisory subsidiary as a result of such an acquisition other than as a result of a fund reorganization transaction pursuant to an agreement and plan of reorganization.

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The following categories of Eligible Investors are subject to applicable minimum initial investment amounts for the purchase of IS or SS classes (see “How to Purchase Shares” below):

• An investor, other than a natural person, purchasing IS and/or SS classes directly from the Fund; and
• In connection with an initial purchase of IS and/or SS classes through an exchange, an investor (including a natural person) who owned IS and/or SS classes of another Federated fund as of December 31, 2008.

Payments to Financial Intermediaries

The Fund and its affiliated service providers may pay fees as described below to financial intermediaries (such as broker-dealers, banks, investment advisers or third-party administrators) whose customers are shareholders of the Fund.

RULE 12b-1 FEES

SS Class

The Board has adopted a Rule 12b-1 Plan, which allows payment of marketing fees of up to 0.05% (SS class) of average net assets to the Distributor for the sale, distribution, administration and customer servicing of the Fund's SS class. When the Distributor receives Rule 12b-1 Fees, it may pay some or all of them to financial intermediaries whose customers purchase Shares. The Fund's SS class has no present intention of paying or accruing a Rule 12b-1 Fee during the fiscal year ending February 29, 2012. Because these Shares pay marketing fees on an ongoing basis, your investment cost may be higher over time than other shares with different marketing fees.

service fees

IS and SS classes may pay Service Fees of up to 0.25% of average net assets to financial intermediaries or to Federated Shareholder Services Company (FSSC), a subsidiary of Federated, for providing services to shareholders and maintaining shareholder accounts. Intermediaries that receive Service Fees may include a company affiliated with management of Federated. If a financial intermediary receives Service Fees on an account, it is not eligible to also receive Account Administration Fees on that same account.

ACCOUNT ADMINISTRATION FEES

IS and SS classes may pay Account Administration Fees of up to 0.25% of average net assets to banks that are not registered as broker-dealers or investment advisers for providing administrative services to the Funds and shareholders. If a financial intermediary receives Account Administration Fees on an account, it is not eligible to also receive Service Fees or Recordkeeping Fees on that same account.

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RECORDKEEPING FEES

The Fund may pay Recordkeeping Fees on an average-net-assets basis or on a per-account-per-year basis to financial intermediaries for providing recordkeeping services to the Fund and its shareholders. If a financial intermediary receives Recordkeeping Fees on an account, it is not eligible to also receive Account Administration Fees or Networking Fees on that same account.

networking fees

The Fund may reimburse Networking Fees on a per-account-per-year basis to financial intermediaries for providing administrative services to the Fund and its shareholders on certain non-omnibus accounts. If a financial intermediary receives Networking Fees on an account, it is not eligible to also receive Recordkeeping Fees on that same account.

ADDITIONAL PAYMENTS TO FINANCIAL INTERMEDIARIES

The Distributor may pay out of its own resources amounts (including items of material value) to certain financial intermediaries that support the sale of Shares or provide services to Fund shareholders. The amounts of these payments could be significant, and may create an incentive for the financial intermediary or its employees or associated persons to recommend or sell Shares of the Fund to you. In some cases, such payments may be made by or funded from the resources of companies affiliated with the Distributor (including the Adviser). These payments are not reflected in the fees and expenses listed in the fee table section of the Fund's Prospectus and described above because they are not paid by the Fund.

These payments are negotiated and may be based on such factors as: the number or value of Shares that the financial intermediary sells or may sell; the value of client assets invested; or the type and nature of services or support furnished by the financial intermediary. These payments may be in addition to payments, as described above, made by the Fund to the financial intermediary. In connection with these payments, the financial intermediary may elevate the prominence or profile of the Fund and/or other Federated funds within the financial intermediary's organization by, for example, placement on a list of preferred or recommended Funds, and/or granting the Distributor preferential or enhanced opportunities to promote the Funds in various ways within the financial intermediary's organization. You can ask your financial intermediary for information about any payments it receives from the Distributor or the Fund and any services provided.

How to Purchase Shares

You may purchase Shares of the Fund any day the NYSE is open. The Fund reserves the right to reject any request to purchase or exchange Shares. New investors must submit a completed New Account Form. All accounts are subject to the Fund's policy on “Accounts with Low Balances” as discussed later in this Prospectus.

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Eligible investors may purchase Shares through a financial intermediary, directly from the Fund or through an exchange from another Federated fund in the manner described above under “How is the Fund Sold?”

Where applicable, the required minimum initial investment for IS and SS classes is generally $1,000,000. There is no required minimum subsequent investment amount.

THROUGH A FINANCIAL INTERMEDIARY

• Establish an account with the financial intermediary; and
• Submit your purchase order to the financial intermediary before the end of regular trading on the NYSE (normally 4:00 p.m. Eastern time).

You will receive the next calculated NAV if the financial intermediary forwards the order on the same day, and forwards your payment by the prescribed trade settlement date (typically within one to three business days) to the Fund's transfer agent, State Street Bank and Trust Company (“Transfer Agent”). You will become the owner of Shares and receive dividends when your payment is received in accordance with these time frames (provided that, if payment is received in the form of a check, the check clears). If your payment is not received in accordance with these time frames, or a check does not clear, your purchase will be canceled and you could be liable for any losses, fees or expenses incurred by the Fund or the Fund's Transfer Agent.

Financial intermediaries should send payments according to the instructions in the sections “By Wire” or “By Check.”

Financial intermediaries may impose higher or lower minimum investment requirements on their customers than those imposed by the Fund. Keep in mind that financial intermediaries may charge you fees for their services in connection with your Share transactions.

DIRECTLY FROM THE FUND

• Establish your account with the Fund by submitting a completed New Account Form; and
• Send your payment to the Fund by Federal Reserve wire or check.

You will become the owner of Shares and your Shares will be priced at the next calculated NAV after the Fund receives your wire or your check. If your check does not clear, your purchase will be canceled and you could be liable for any losses or fees incurred by the Fund or the Fund's Transfer Agent.

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By Wire

To facilitate processing your order, please call the Fund before sending the wire. Send your wire to:

State Street Bank and Trust Company
Boston, MA
Dollar Amount of Wire
ABA Number 011000028
BNF: 23026552
Attention: Federated EDGEWIRE
Wire Order Number, Dealer Number or Group Number
Nominee/Institution Name
Fund Name and Number and Account Number

You cannot purchase Shares by wire on holidays when wire transfers are restricted.

By Check

Make your check payable to The Federated Funds, note your account number on the check, and send it to:

The Federated Funds
P.O. Box 8600
Boston, MA 02266-8600

If you send your check by a private courier or overnight delivery service that requires a street address, send it to:

The Federated Funds
30 Dan Road
Canton, MA 02021

Payment should be made in U.S. dollars and drawn on a U.S. bank. The Fund reserves the right to reject any purchase request. For example, to protect against check fraud the Fund may reject any purchase request involving a check that is not made payable to The Federated Funds (including, but not limited to, requests to purchase Shares using third-party checks) or involving temporary checks or credit card checks.

THROUGH AN EXCHANGE

You may purchase Fund Shares through an exchange from another Federated fund. An exchange is treated as a redemption and a subsequent purchase, and is a taxable transaction.

To do this you must:

• ensure that the account registrations are identical;
• meet any applicable minimum initial investment requirements; and
• receive a prospectus for the fund into which you wish to exchange.

The Fund may modify or terminate the exchange privilege at any time.

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You may purchase Shares through an exchange from any Federated fund or share class that does not have a stated sales charge or contingent deferred sales charge, except Federated Liberty U.S. Government Money Market Trust and any R class.

BY AUTOMATED CLEARING HOUSE (ACH)

Once you have opened an account, you may purchase additional Shares through a depository institution that is an ACH member. This purchase option can be established by completing the appropriate sections of the New Account Form.

How to Redeem and Exchange Shares

You should redeem or exchange Shares:

• through a financial intermediary if you purchased Shares through a financial intermediary; or
• directly from the Fund if you purchased Shares directly from the Fund.

Shares of the Fund may be redeemed for cash, or exchanged for shares of other Federated funds as described herein, on days on which the Fund computes its NAV. Redemption requests may be made by telephone or in writing.

THROUGH A FINANCIAL INTERMEDIARY

Submit your redemption or exchange request to your financial intermediary by the end of regular trading on the NYSE (normally 4:00 p.m. Eastern time). The redemption amount you will receive is based upon the next calculated NAV after the Fund receives the order from your financial intermediary.

DIRECTLY FROM THE FUND

By Telephone

You may redeem or exchange Shares by simply calling the Fund at 1-800-341-7400.

If you call before the end of regular trading on the NYSE (normally 4:00 p.m. Eastern time), you will receive a redemption amount based on that day's NAV.

By Mail

You may redeem or exchange Shares by sending a written request to the Fund.

You will receive a redemption amount based on the next calculated NAV after the Fund receives your written request in proper form.

Send requests by mail to:

The Federated Funds
P.O. Box 8600
Boston, MA 02266-8600

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Send requests by private courier or overnight delivery service to:

The Federated Funds
30 Dan Road
Canton, MA 02021

All requests must include:

• Fund Name and Share Class, account number and account registration;
• amount to be redeemed or exchanged;
• signatures of all shareholders exactly as registered; and
• if exchanging, the Fund Name and Share Class, account number and account registration into which you are exchanging.

Call your financial intermediary or the Fund if you need special instructions.

Signature Guarantees

Signatures must be guaranteed by a financial institution which is a participant in a Medallion signature guarantee program if:

• your redemption will be sent to an address other than the address of record;
• your redemption will be sent to an address of record that was changed within the last 30 days;
• a redemption is payable to someone other than the shareholder(s) of record; or
• transferring into another fund with a different shareholder registration.

A Medallion signature guarantee is designed to protect your account from fraud. Obtain a Medallion signature guarantee from a bank or trust company, savings association, credit union or broker, dealer or securities exchange member. A notary public cannot provide a signature guarantee.

PAYMENT METHODS FOR REDEMPTIONS

Your redemption proceeds will be mailed by check to your address of record. The following payment options are available if you complete the appropriate section of the New Account Form or an Account Service Options Form. These payment options require a signature guarantee if they were not established when the account was opened:

• an electronic transfer to your account at a financial institution that is an ACH member; or
• wire payment to your account at a domestic commercial bank that is a Federal Reserve System member.

Redemption In-Kind

Although the Fund intends to pay Share redemptions in cash, it reserves the right to pay the redemption price in whole or in part by a distribution of the Fund's portfolio securities.

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LIMITATIONS ON REDEMPTION PROCEEDS

Redemption proceeds normally are wired or mailed within one business day after receiving a request in proper form. Payment may be delayed for up to seven days:

• to allow your purchase to clear (as discussed below);
• during periods of market volatility;
• when a shareholder's trade activity or amount adversely impacts the Fund's ability to manage its assets; or
• during any period when the Federal Reserve wire or applicable Federal Reserve banks are closed, other than customary weekend and holiday closings.

If you request a redemption of Shares recently purchased by check (including a cashier's check or certified check), money order, bank draft or ACH, your redemption proceeds may not be made available for up to seven calendar days to allow the Fund to collect payment on the instrument used to purchase such Shares. If the purchase instrument does not clear, your purchase order will be canceled and you will be responsible for any losses incurred by the Fund as a result of your canceled order.

In addition, the right of redemption may be suspended, or the payment of proceeds may be delayed, during any period:

• when the NYSE is closed, other than customary weekend and holiday closings;
• when trading on the NYSE is restricted, as determined by the SEC; or
• in which an emergency exists, as determined by the SEC, so that disposal of the Fund's investments or determination of its NAV is not reasonably practicable.

You will not accrue interest or dividends on uncashed redemption checks from the Fund if those checks are undeliverable and returned to the Fund.

EXCHANGE PRIVILEGE

You may exchange Shares of the Fund. An exchange is treated as a redemption and a subsequent purchase, and is a taxable transaction. To do this, you must:

• ensure that the account registrations are identical;
• meet any applicable minimum initial investment requirements; and
• receive a prospectus for the fund into which you wish to exchange.

The Fund may modify or terminate the exchange privilege at any time.

You may exchange Shares for shares of any Federated fund or share class that does not have a stated sales charge or contingent deferred sales charge, except Federated Liberty U.S. Government Money Market Trust and any R class.

ADDITIONAL CONDITIONS

Telephone Transactions

The Fund will record your telephone instructions. If the Fund does not follow reasonable procedures, it may be liable for losses due to unauthorized or fraudulent telephone instructions.

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Share Certificates

The Fund no longer issues share certificates. If you are redeeming or exchanging Shares represented by certificates previously issued by the Fund, you must return the certificates with your written redemption or exchange request. For your protection, send your certificates by registered or certified mail, but do not endorse them.

Account and Share Information

CONFIRMATIONS AND ACCOUNT STATEMENTS

You will receive confirmation of purchases, redemptions and exchanges. In addition, you will receive periodic statements reporting all account activity, including dividends and capital gains paid.

DIVIDENDS AND CAPITAL GAINS

The Fund declares any dividends daily and pays them monthly to shareholders. If you purchase Shares by wire, you begin earning dividends on the day your wire is received. If you purchase Shares by check, you begin earning dividends on the business day after the Fund receives your check. In either case, you earn dividends through the day your redemption request is received.

In addition, the Fund pays any capital gains at least annually, and may make such special distributions of dividends and capital gains as may be necessary to meet applicable regulatory requirements. Your dividends and capital gains distributions will be automatically reinvested in additional Shares without a sales charge, unless you elect cash payments. Dividends may also be reinvested without sales charges in shares of any class of any other Federated fund of which you are already a shareholder.

If you have elected to receive dividends and/or capital gain distributions in cash, and your check is returned by the postal or other delivery service as “undeliverable,” or you do not respond to mailings from Federated with regard to uncashed distribution checks, your distribution option will automatically be converted to having all dividends and capital gains reinvested in additional Shares. No interest will accrue on amounts represented by uncashed distribution checks.

If you purchase Shares just before the record date for a capital gain distribution, you will pay the full price for the Shares and then receive a portion of the price back in the form of a taxable distribution, whether or not you reinvest the distribution in Shares. Therefore, you should consider the tax implications of purchasing Shares shortly before the record date for a capital gain. Contact your financial intermediary or the Fund for information concerning when dividends and capital gains will be paid.

Under the federal securities laws, the Fund is required to provide a notice to shareholders regarding the source of distributions made by the Fund if such distributions are from sources other than ordinary investment income. In addition, important information regarding the Fund's distributions, if applicable, is available in the “Products” section of Federated's website at

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FederatedInvestors.com. To access this information from the home page, select “View All” next to “Find Products.” Select the Fund name and share class, if applicable, to go to the Fund Overview page. On the Fund Overview page, select the “Tax Information” tab. On the “Tax Information” tab, select a year.

ACCOUNTS WITH LOW BALANCES

Federated reserves the right to close accounts if redemptions or exchanges cause the account balance to fall below $25,000 for IS and SS classes. Before an account is closed, you will be notified and allowed at least 30 days to purchase additional Shares to meet the minimum.

TAX INFORMATION

The Fund sends an IRS Form 1099 and an annual statement of your account activity to assist you in completing your federal, state and local tax returns. Fund distributions of dividends and capital gains are taxable to you whether paid in cash or reinvested in the Fund. Dividends are taxable at different rates depending on the source of dividend income. Distributions of net short-term capital gains are taxable to you as ordinary income. Distributions of net long-term capital gains are taxable to you as long-term capital gains regardless of how long you have owned your Shares.

Fund distributions are expected to be primarily dividends. Redemptions and exchanges are taxable sales. Please consult your tax adviser regarding your federal, state and local tax liability.

FREQUENT TRADING POLICIES

Given the liquid nature of the Fund's investments and the low transaction costs associated with these investments, the Fund does not anticipate that in the normal case frequent or short-term trading into and out of the Fund will have significant adverse consequences for the Fund and its shareholders. For this reason, the Fund's Board has not adopted policies or procedures to monitor or discourage frequent or short-term trading of the Fund's Shares. Regardless of their frequency or short-term nature, purchases and redemptions of Fund Shares can have adverse effects on the management of the Fund's portfolio and its performance.

PORTFOLIO HOLDINGS INFORMATION

Information concerning the Fund's portfolio holdings is available in the “Products” section of Federated's website at FederatedInvestors.com. A complete listing of the Fund's portfolio holdings as of the end of each calendar quarter is posted on the website 30 days (or the next business day) after the end of the quarter and remains posted for at least one year. Summary portfolio composition information as of the close of each month is posted on the website 15 days (or the next business day) after month-end and remains posted for at least one year. The summary portfolio composition information may include percentage breakdowns of the portfolio by type of security.

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To access this information from the “Products” section of the website's home page, select “View All” next to “Find Products.” Select the Fund name and share class, if applicable, to go to the Fund Overview page. On the Fund Overview page, select the “Portfolio Characteristics” tab for summary portfolio information or the “Documents” tab to access “Holdings.”

You may also access portfolio information as of the end of the Fund's fiscal quarters from the “Documents” tab. The Fund's Annual Shareholder Report and Semi-Annual Shareholder Report contain complete listings of the Fund's portfolio holdings as of the end of the Fund's second and fourth fiscal quarters. The Fund's Form N-Q filings contain complete listings of the Fund's portfolio holdings as of the end of the Fund's first and third fiscal quarters. Fiscal quarter information is made available on the website within 70 days after the end of the fiscal quarter. This information is also available in reports filed with the SEC at the SEC's website at www.sec.gov.

In addition, from time to time (for example, during periods of unusual market conditions), additional information regarding the Fund's portfolio holdings and/or composition may be posted to Federated's website. If and when such information is posted, its availability will be noted on, and the information will be accessible from, the home page of the website.

Who Manages the Fund?

The Board governs the Fund. The Board selects and oversees the Adviser, Federated Investment Management Company. The Adviser manages the Fund's assets, including buying and selling portfolio securities. Federated Advisory Services Company (FASC), an affiliate of the Adviser, provides certain support services to the Adviser. The fee for these services is paid by the Adviser and not by the Fund. The address of the Adviser and FASC is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, PA 15222-3779.

The Adviser and other subsidiaries of Federated advise approximately 136 equity, fixed-income and money market mutual funds as well as a variety of other customized, separately managed accounts and private investment companies and other pooled investment vehicles (including non-U.S./offshore funds) which totaled approximately $358.2 billion in assets as of December 31, 2010. Federated was established in 1955 and is one of the largest investment managers in the United States with approximately 1,334 employees. Federated provides investment products to approximately 5,000 investment professionals and institutions.

The Adviser advises approximately 111 fixed-income and money market mutual funds (including sub-advised funds) and private investment companies, which totaled approximately $259.5 billion in assets as of December 31, 2010.

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PORTFOLIO MANAGEMENT INFORMATION

Liam O'Connell

Liam O'Connell has been a portfolio manager of the Fund since June 2005. Mr. O'Connell joined Federated in September 2003 as an Investment Analyst of the Fund's Adviser. He was named an Assistant Vice President of the Adviser in January 2005. From 2001 to 2003, Mr. O'Connell attended MIT's Sloan School of Management, receiving his M.B.A. Mr. O'Connell served as an engineer with the Naval Surface Warfare Center from 1998 to 2001. Mr. O'Connell also holds a B.S. in Naval Architecture and Marine Engineering from the Webb Institute of Naval Architecture, and an M.S. from the Johns Hopkins University.

The Fund's SAI provides additional information about the Portfolio Manager's compensation, management of other accounts and ownership of securities in the Fund.

ADVISORY FEES

The Fund's investment advisory contract provides for payment to the Adviser of an annual investment advisory fee of 0.40% of the Fund's average daily net assets. The Adviser may voluntarily waive a portion of its fee or reimburse the Fund for certain operating expenses. The Adviser and its affiliates have also agreed to certain “Fee Limits” as described in the footnote to the “Risk/Return Summary: Fees and Expenses” table found in the “Fund Summary” section of the Prospectus.

A discussion of the Board's review of the Fund's investment advisory contract is available in the Fund's shareholder reports as they are produced.

Legal Proceedings

Since February 2004, Federated and related entities (collectively, “Federated”) have been named as defendants in several lawsuits that are now pending in the United States District Court for the Western District of Pennsylvania. These lawsuits have been consolidated into a single action alleging excessive advisory fees involving one of the Federated-sponsored mutual funds (“Funds”).

Federated and its counsel have been defending this litigation. Additional lawsuits based upon similar allegations may be filed in the future. The potential impact of these lawsuits, all of which seek monetary damages, attorneys' fees and expenses, and future potential similar suits is uncertain. Although we do not believe that these lawsuits will have a material adverse effect on the Funds, there can be no assurance that these suits, ongoing adverse publicity and/or other developments resulting from the allegations in these matters will not result in increased redemptions, or reduced sales, of shares of the Funds or other adverse consequences for the Funds.

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Financial Information

FINANCIAL HIGHLIGHTS

The Financial Highlights will help you understand the Fund's financial performance for its past five fiscal years. Some of the information is presented on a per Share basis. Total returns represent the rate an investor would have earned (or lost) on an investment in the Fund, assuming reinvestment of any dividends and capital gains.

This information has been audited by Ernst & Young LLP, an independent registered public accounting firm, whose report, along with the Fund's audited financial statements, is included in the Annual Report.

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Financial Highlights – Institutional Shares

(For a Share Outstanding Throughout Each Period)

Year Ended February 28 or 29	2011	2010	2009	2008	2007
Net Asset Value, Beginning of Period	$9.80	$9.58	$9.61	$9.36	$9.33
Income From Investment Operations:
Net investment income	0.161	0.15	0.301	0.47	0.45
Net realized and unrealized gain on investments and futures contracts	0.16	0.22	0.04	0.26	0.04
TOTAL FROM INVESTMENT OPERATIONS	0.32	0.37	0.34	0.73	0.49
Less Distributions:
Distributions from net investment income	(0.18)	(0.15)	(0.37)	(0.48)	(0.46)
Net Asset Value, End of Period	$9.94	$9.80	$9.58	$9.61	$9.36
Total Return2	3.26%	3.89%	3.62%	8.03%	5.45%
Ratios to Average Net Assets:
Net expenses	0.30%	0.30%	0.30%	0.30%	0.30%
Net investment income	1.56%	1.44%	3.14%	4.89%	4.84%
Expense waiver/reimbursement3	1.74%	1.69%	1.50%	1.33%	1.23%
Supplemental Data:
Net assets, end of period (000 omitted)	$4,120	$3,346	$2,127	$1,777	$2,476
Portfolio turnover	149%	108%	287%	370%	267%
Portfolio turnover (excluding purchases and sales from dollar-roll transactions)	49%	62%	46%	25%	157%

1	Per share numbers have been calculated using the average shares method.
2	Based on net asset value.
3	This expense decrease is reflected in both the net expense and the net investment income ratios shown above.

Further information about the Fund's performance is contained in the Fund's Annual Report, dated February 28, 2011, which can be obtained free of charge.

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Financial Highlights – Institutional Service Shares

(For a Share Outstanding Throughout Each Period)

Year Ended February 28 or 29	2011	2010	2009	2008	2007
Net Asset Value, Beginning of Period	$9.80	$9.58	$9.61	$9.36	$9.33
Income From Investment Operations:
Net investment income	0.141	0.12	0.281	0.45	0.44
Net realized and unrealized gain on investments and futures contracts	0.16	0.23	0.03	0.26	0.03
TOTAL FROM INVESTMENT OPERATIONS	0.30	0.35	0.31	0.71	0.47
Less Distributions:
Distributions from net investment income	(0.16)	(0.13)	(0.34)	(0.46)	(0.44)
Net Asset Value, End of Period	$9.94	$9.80	$9.58	$9.61	$9.36
Total Return2	3.05%	3.70%	3.40%	7.78%	5.21%
Ratios to Average Net Assets:
Net expenses	0.51%	0.49%	0.53%	0.53%	0.54%
Net investment income	1.35%	1.27%	2.91%	4.66%	4.66%
Expense waiver/reimbursement3	1.74%	1.73%	1.56%	1.58%	1.43%
Supplemental Data:
Net assets, end of period (000 omitted)	$24,565	$25,386	$28,373	$32,371	$34,618
Portfolio turnover	149%	108%	287%	370%	267%
Portfolio turnover (excluding purchases and sales from dollar-roll transactions)	49%	62%	46%	25%	157%

1	Per share numbers have been calculated using the average shares method.
2	Based on net asset value.
3	This expense decrease is reflected in both the net expense and the net investment income ratios shown above.

Further information about the Fund's performance is contained in the Fund's Annual Report, dated February 28, 2011, which can be obtained free of charge.

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Appendix A: Hypothetical Investment and Expense Information

The following charts provide additional hypothetical information about the effect of the Fund's expenses, including investment advisory fees and other Fund costs, on the Fund's assumed returns over a 10-year period. Each chart shows the estimated expenses that would be incurred in respect of a hypothetical investment of $10,000, assuming a 5% return each year, and no redemption of Shares. Each chart also assumes that the Fund's annual expense ratio stays the same throughout the 10-year period and that all dividends and distributions are reinvested. The annual expense ratios used in each chart are the same as stated in the “Fees and Expenses” table of this Prospectus (and thus may not reflect any fee waiver or expense reimbursement currently in effect). The maximum amount of any sales charge that might be imposed on the purchase of Shares (and deducted from the hypothetical initial investment of $10,000; the “Front-End Sales Charge”) is reflected in the “Hypothetical Expenses” column. The hypothetical investment information does not reflect the effect of charges (if any) normally applicable to redemptions of Shares (e.g., deferred sales charges, redemption fees). Mutual fund returns, as well as fees and expenses, may fluctuate over time, and your actual investment returns and total expenses may be higher or lower than those shown below.

FEDERATED INTERMEDIATE GOVERNMENT FUND, INC. - IS CLASS
ANNUAL EXPENSE RATIO: 2.30%
MAXIMUM FRONT-END SALES CHARGE: NONE
Year	Hypothetical Beginning Investment	Hypothetical Performance Earnings	Investment After Returns	Hypothetical Expenses	Hypothetical Ending Investment
1	$10,000.00	$500.00	$10,500.00	$233.11	$10,270.00
2	$10,270.00	$513.50	$10,783.50	$239.40	$10,547.29
3	$10,547.29	$527.36	$11,074.65	$245.86	$10,832.07
4	$10,832.07	$541.60	$11,373.67	$252.50	$11,124.54
5	$11,124.54	$556.23	$11,680.77	$259.32	$11,424.90
6	$11,424.90	$571.25	$11,996.15	$266.32	$11,733.37
7	$11,733.37	$586.67	$12,320.04	$273.51	$12,050.17
8	$12,050.17	$602.51	$12,652.68	$280.90	$12,375.52
9	$12,375.52	$618.78	$12,994.30	$288.48	$12,709.66
10	$12,709.66	$635.48	$13,345.14	$296.27	$13,052.82
Cumulative		$5,653.38		$2,635.67

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FEDERATED INTERMEDIATE GOVERNMENT FUND, INC. - SS CLASS
ANNUAL EXPENSE RATIO: 2.35%
MAXIMUM FRONT-END SALES CHARGE: NONE
Year	Hypothetical Beginning Investment	Hypothetical Performance Earnings	Investment After Returns	Hypothetical Expenses	Hypothetical Ending Investment
1	$10,000.00	$500.00	$10,500.00	$238.11	$10,265.00
2	$10,265.00	$513.25	$10,778.25	$244.42	$10,537.02
3	$10,537.02	$526.85	$11,063.87	$250.90	$10,816.25
4	$10,816.25	$540.81	$11,357.06	$257.55	$11,102.88
5	$11,102.88	$555.14	$11,658.02	$264.37	$11,397.11
6	$11,397.11	$569.86	$11,966.97	$271.38	$11,699.13
7	$11,699.13	$584.96	$12,284.09	$278.57	$12,009.16
8	$12,009.16	$600.46	$12,609.62	$285.95	$12,327.40
9	$12,327.40	$616.37	$12,943.77	$293.53	$12,654.08
10	$12,654.08	$632.70	$13,286.78	$301.31	$12,989.41
Cumulative		$5,640.40		$2,686.09

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Notes

[Page Intentionally Left Blank]

Notes [Page Intentionally Left Blank]

An SAI dated April 30, 2011, is incorporated by reference into this Prospectus. Additional information about the Fund and its investments is contained in the Fund's SAI and Annual and Semi-Annual Reports to shareholders as they become available. The Annual Report's Management's Discussion of Fund Performance discusses market conditions and investment strategies that significantly affected the Fund's performance during its last fiscal year. The SAI contains a description of the Fund's policies and procedures with respect to the disclosure of its portfolio securities. To obtain the SAI, Annual Report, Semi-Annual Report and other information without charge, and to make inquiries, call your financial intermediary or the Fund at 1-800-341-7400.

These documents, as well as additional information about the Fund (including portfolio holdings, performance and distributions), are also available on Federated's website at FederatedInvestors.com.

You can obtain information about the Fund (including the SAI) by writing to or visiting the SEC's Public Reference Room in Washington, DC. You may also access Fund information from the EDGAR Database on the SEC's website at www.sec.gov. You can purchase copies of this information by contacting the SEC by email at publicinfo@sec.gov or by writing to the SEC's Public Reference Section, Washington, DC 20549. Call 1-202-551-8090 for information on the Public Reference Room's operations and copying fees.

Federated Intermediate Government Fund, Inc.
Federated Investors Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561

Contact us at FederatedInvestors.com
or call 1-800-341-7400.

Federated Securities Corp., Distributor

Investment Company Act File No. 811-6307

Cusip 31420H109
Cusip 31420H208

25745 (4/11)

Federated is a registered trademark of Federated Investors, Inc.
2011  ^©Federated Investors, Inc.

Federated Intermediate Government Fund, Inc.

Statement of Additional Information

April 30, 2011

INSTITUTIONAL SHARES (TICKER FLDIX)
INSTITUTIONAL SERVICE SHARES (TICKER XFLDSX)

This Statement of Additional Information (SAI) is not a Prospectus. Read this SAI in conjunction with the Prospectuses for Federated Intermediate Government Fund, Inc. (“Fund”), dated April 30, 2011.

This SAI incorporates by reference the Fund’s Annual Report. Obtain the Prospectuses or the Annual Report without charge by calling 1-800-341-7400.

CONTENTS
How is the Fund Organized?	1
Description of the Fund and its Investments and Risks	1
Securities in Which the Fund Invests	2
Investment Risks	9
Investment Objective (and Policies) and Investment Limitations	10
What Do Shares Cost?	11
How is the Fund Sold?	13
Purchases In-Kind	15
Subaccounting Services	15
Redemption In-Kind	15
Account and Share Information	15
Tax Information	16
Who Manages and Provides Services to the Fund?	16
How Does the Fund Measure Performance?	27
Financial Information	28
Investment Ratings	28
Addresses	32
Appendix	33

Federated Intermediate Government Fund, Inc.
Federated Investors Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561

Contact us at FederatedInvestors.com
or call 1-800-341-7400.

Federated Securities Corp., Distributor

1071005B (4/11)

Federated is a registered trademark
of Federated Investors, Inc.
2011  ©Federated Investors, Inc.

How is the Fund Organized?

The Fund is a diversified open-end, management investment company that was established under the laws of the state of Maryland on March 20, 1991. The Fund changed its name from Federated Limited Duration Government Fund, Inc. to Federated Intermediate Government Fund, Inc. on April 30, 2005.

The Board of Directors (“Board”) has established two classes of shares of the Fund, known as Institutional Shares and Institutional Service Shares (“Shares”). This SAI relates to both classes of Shares. The Fund’s investment adviser is Federated Investment Management Company (“Adviser”).

Description of the Fund and its Investments and Risks

INVESTMENT OBJECTIVE

The Fund’s investment objective is to provide total return. The investment objective may not be changed by the Board without shareholder approval. The Fund’s total return will consist of two components: (1) changes in the market value of its portfolio securities (both realized and unrealized appreciation), and (2) income received from its portfolio securities. The Fund expects that, under normal market conditions, income will comprise the largest component of its total return. While there is no assurance that the Fund will achieve its investment objective, it endeavors to do so by following the strategies and policies described in this SAI.

INVESTMENT STRATEGIES

Under normal market conditions, the Fund invests primarily in Treasury, government agency and government agency-backed, mortgage-backed securities (MBS). There can be no assurances that the Fund will achieve its investment objective or that the investment strategies used by the Adviser will be successful. The Fund will invest in MBS that are issued or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises (GSEs). The Fund also may invest in U.S. government securities and certain derivative instruments.

The Fund typically seeks to maintain an overall average dollar-weighted portfolio duration that is within 20% above or 50% below the Barclays Capital Intermediate Government Index (the “Index”). At times, the Adviser’s calculation of portfolio duration will result in variances outside this range. Duration is a measure of the price volatility of a debt instrument as a result of changes in market rates of interest, based on the weighted average timing of the instrument’s expected fixed interest and principal payments. Securities with longer durations tend to be more sensitive to interest rate changes than securities with shorter durations. The Adviser seeks to create a portfolio, consisting of U.S. government securities, MBS, derivative instruments and other securities, that outperforms the Index. In implementing the Fund’s investment strategy, the Adviser typically will take into consideration: (i) overall levels of interest rates; (ii) volatility of interest rates; (iii) relative interest rates of securities with longer and shorter durations (known as a “yield curve”); and (iv) relative interest rates of different types of securities (such as U.S. Treasury, agency and MBS).

Based on fundamental analysis, the Adviser will consider a variety of factors when making decisions to purchase or sell particular securities or derivative contracts, including: the securities’ specific interest rate and prepayment risks, and price sensitivity to changes in market spread levels and in the level of interest rate volatility. In analyzing MBS, the Adviser also may consider the average interest rates of the underlying loans, the prior and expected prepayments, any ratings issued by NRSROs and any guarantee of the security or underlying loans by a GSE.

The Fund may, but is not required to, use derivative instruments, which are instruments that have a value based on another instrument, exchange rate or index, and may be used as substitutes for securities in which the Fund can invest, or to hedge against a potential loss in the underlying asset. The Fund may use futures contracts, options, options on futures (including those relating to interest rates) and swaps as tools in the management of portfolio assets. There can be no assurance that the Fund’s use of derivative instruments will work as intended.

Teams of investment professionals formulate the Adviser’s interest rate outlook and otherwise attempt to anticipate changes in market conditions. They base their analysis on a number of factors, which may include:

• current and expected U.S. economic growth;
• current and expected changes in the rate of inflation;
• the Federal Reserve Board’s monetary policy; and
• technical factors affecting the supply or demand for specific securities or types of securities.

These teams also recommend how to structure the portfolio in response to their interest rate outlook. In order to manage the risks taken by the Fund, these recommendations may set additional limits on the extent to which the portfolio’s duration and composition may differ from the Index. Uncertainty as to the amount and timing of prepayments make calculating the durations of mortgaged-backed securities more difficult than some other types of fixed-income securities. The Adviser calculates the duration

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of the portfolio using standard analytical models that quantify the expected changes in the value of the portfolio resulting from changes in the applicable yield curve. The Index may calculate its duration using different assumptions and models. The Adviser will rely on its calculations for purposes of complying with any limitations established with respect to the portfolio’s duration. There is no assurance that the Adviser’s efforts to forecast market conditions and interest rates, or to assess the impact of changes in interest rates and the yield curve, will be successful.

The Fund’s portfolio manager follows these recommendations in selecting a portfolio of mortgage-backed securities, U.S. government securities and related derivative contracts that have the potential to provide better returns than the Index. Characteristics that the Adviser may consider in analyzing mortgage-backed securities include the average interest rates of the underlying loans, the prior prepayment history, any ratings issued by NRSROs and any guarantee of the security or underlying loans by a GSE. This analysis relies on information from a variety of sources (such as U.S. government securities dealers, electronic data services and financial publications), and employs quantitative models and analytic tools provided by third parties or developed by the Adviser. The analysis also draws on the experience of the Adviser’s staff of investment analysts, portfolio managers and traders.

The portfolio manager uses this fundamental analysis to compare the potential returns from available securities with comparable durations, risks and other characteristics. For mortgage-backed securities, the decision to buy or sell also involves assessment of available securities relative to specific interest rate and prepayment risks, such as average life variability, price sensitivity to changes in market spread levels and price sensitivity to changes in the level of interest rate volatility. The Adviser assesses these risks by analyzing how the timing, amount and division of cash flows from the loans underlying a security might change in response to changing economic and market conditions. However, there is no assurance that a security or derivative contract will perform as expected or that the fundamental analysis will incorporate all relevant information. The investment-grade, mortgage-backed securities held by the Fund will include both pass-through certificates and various kinds of collateralized mortgage obligations (CMOs).

The Fund may also enter into derivative contracts for U.S. government securities in order to implement its investment strategy. The Fund may purchase and sell futures contracts and options to manage the duration of the portfolio. The Fund may also sell options and enter into swaps in order to generate additional investment income.

Mortgage-backed, pass-through certificates are typically offered or traded on a “to-be-announced” or other delayed delivery basis. Other U.S. government securities may also be offered on a delayed delivery basis. The Fund will enter into trades on this basis in order to participate in these offerings or trade these securities. The Fund may also seek to increase its income by engaging in dollar-roll transactions and by lending its portfolio securities.

The Fund invests in overnight repurchase agreements in order to maintain sufficient cash to pay for daily net redemptions and portfolio transactions. In the event that the Fund does not have sufficient cash for these purposes, it could incur overdrafts, enter into reverse repurchase agreements or otherwise borrow money in accordance with its investment limitations. The Fund also reserves the right to redeem Shares in kind with portfolio securities. See “Payment Method for Redemptions – Redemptions In-Kind.”

The Fund may also enter into repurchase agreements with longer terms (up to 12 months) if they offer higher returns than those expected from U.S. Treasury or agency securities having the same maturity.

Because the Fund refers to U.S. government securities in its name, it will notify shareholders at least 60 days in advance of any change in its investment policies that would enable the Fund to invest, under normal circumstances, less than 80% of its assets in U.S. government investments.

Securities in Which the Fund Invests

The principal securities or other investments in which the Fund invests are described in the Fund’s Prospectus. The Fund also may invest in securities or other investments as non-principal investments for any purpose that is consistent with its investment objective. The following information is either additional information in respect of a principal security or other investment referenced in the Prospectus or information in respect of a non-principal security or other investment (in which case there is no related disclosure in the Prospectus).

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Securities Descriptions And Techniques

Fixed-Income Securities

Fixed-income securities pay interest, dividends or distributions at a specified rate. The rate may be a fixed percentage of the principal or may be adjusted periodically. In addition, the issuer of a fixed-income security must repay the principal amount of the security, normally within a specified time. Fixed-income securities provide more regular income than equity securities. However, the returns on fixed-income securities are limited and normally do not increase with the issuer’s earnings. This income limits the potential appreciation of fixed-income securities as compared to equity securities.

A security’s yield measures the annual income earned on a security as a percentage of its price. A security’s yield will increase or decrease depending upon whether it costs less (a discount) or more (a premium) than the principal amount. If the issuer may redeem the security before its scheduled maturity, the price and yield on a discount or premium security may change based upon the probability of an early redemption. Securities with higher risks generally have higher yields.

The following describes the types of fixed-income securities in which the Fund invests. This information is either additional information in respect of a principal security referenced in the Prospectus or information in respect of non-principal security (in which case there is no related disclosure in the Prospectus).

Government Securities (A Fixed-Income Security)

Government securities are issued or guaranteed by a federal agency or instrumentality acting under federal authority. Some government securities are supported by the full faith and credit of the United States. These include the Government National Mortgage Association (“Ginnie Mae”), Small Business Administration, Federal Financing Bank, Department of Housing and Urban Development, Export-Import Bank, Overseas Private Investment Corporation and Federal Deposit Insurance Corporation.

Other government securities receive support through federal subsidies, loans or other benefits. For example, the U.S. Treasury is authorized to purchase specified amounts of securities issued by (or otherwise make funds available to) the Federal Home Loan Bank System, Federal Home Loan Mortgage Corporation (“Freddie Mac”), Federal National Mortgage Association (“Fannie Mae”) and Tennessee Valley Authority in support of such obligations.

A few government securities have no explicit financial support, but are regarded as having implied support because the federal government sponsors their activities. These include Farm Credit System and Financing Corporation securities.

The Fund treats mortgage-backed securities guaranteed by a federal agency or instrumentality as government securities. Although such a guarantee protects against credit risks, it does not reduce other risks.

Recent Events Related to Freddie Mac and Fannie Mae. The extreme and unprecedented volatility and disruption that impacted the capital and credit markets beginning in 2008 led to market concerns regarding the ability of Freddie Mac and Fannie Mae to withstand future credit losses associated with securities held in their investment portfolios, and on which they provide guarantees, without the direct support of the federal government. On September 7, 2008, both Freddie Mac and Fannie Mae were placed under the conservatorship of the Federal Housing Finance Agency (FHFA), a newly created independent regulator. Under the plan of conservatorship, the FHFA assumed control of, and generally has the power to direct, the operations of Freddie Mac and Fannie Mae, and is empowered to exercise all powers collectively held by their respective shareholders, directors and officers, including the power to: (1) take over the assets of and operate Freddie Mac and Fannie Mae with all the powers of the shareholders, the directors, and the officers of Freddie Mac and Fannie Mae and conduct all business of Freddie Mac and Fannie Mae; (2) collect all obligations and money due to Freddie Mac and Fannie Mae; (3) perform all functions of Freddie Mac and Fannie Mae which are consistent with the conservator’s appointment; (4) preserve and conserve the assets and property of Freddie Mac and Fannie Mae; and (5) contract for assistance in fulfilling any function, activity, action or duty of the conservator.

In connection with the actions taken by the FHFA, the Treasury has entered into certain preferred stock purchase agreements (“SPAs”) with each of Freddie Mac and Fannie Mae which establish the Treasury as the holder of a new class of senior preferred stock in each of Freddie Mac and Fannie Mae. The senior preferred stock was issued in connection with financial contributions from the Treasury to Freddie Mac and Fannie Mae; the Treasury is obligated to provide such financial contributions under the SPAs through 2012. The SPAs impose significant restrictions on the activities of Freddie Mac and Fannie Mae.

The future status and role of Freddie Mac and Fannie Mae could be impacted by (among other things) the actions taken and restrictions placed on Freddie Mac and Fannie Mae by the FHFA in its role as conservator, the restrictions placed on Freddie Mac’s and Fannie Mae’s operations and activities under the SPAs, market responses to developments at Freddie Mac and Fannie Mae, and future legislative and regulatory action that alters the operations, ownership, structure and/or mission of these institutions, each of which may, in turn, impact the value of, and cash flows on, any securities guaranteed by Freddie Mac and Fannie Mae.

3Table Of Contents

Collateralized Mortgage Obligations (A Type of Mortgage-Backed Security)

Collateralized mortgage obligations (CMOs), including interests in real estate mortgage investment conduits (REMICs), allocate payments and prepayments from an underlying pass-through certificate among holders of different classes of mortgage-backed securities. This creates different prepayment and interest rate risks for each CMO class. The degree of increased or decreased prepayment risks depends upon the structure of the CMOs. However, the actual returns on any type of mortgage-backed security depend upon the performance of the underlying pool of mortgages, which no one can predict and will vary among pools.

Sequential CMOs (A Type of CMO)

In a sequential pay CMO, one class of CMOs receives all principal payments and prepayments. The next class of CMOs receives all principal payments after the first class is paid off. This process repeats for each sequential class of CMO. As a result, each class of sequential pay CMOs reduces the prepayment risks of subsequent classes.

PACs, TACs and Companion Classes (Types of CMOs)

More sophisticated CMOs include planned amortization classes (PACs) and targeted amortization classes (TACs). PACs and TACs are issued with companion classes. PACs and TACs receive principal payments and prepayments at a specified rate. The companion classes receive principal payments and prepayments in excess of the specified rate. In addition, PACs will receive the companion classes’ share of principal payments, if necessary, to cover a shortfall in the prepayment rate. This helps PACs and TACs to control prepayment risks by increasing the risks to their companion classes.

IOs and POs (Types of CMOs)

CMOs may allocate interest payments to one class (“Interest Only” or IOs) and principal payments to another class (“Principal Only” or POs). POs increase in value when prepayment rates increase. In contrast, IOs decrease in value when prepayments increase, because the underlying mortgages generate less interest payments. However, IOs tend to increase in value when interest rates rise (and prepayments decrease), making IOs a useful hedge against interest rate risks.

Floaters and Inverse Floaters (Types of CMOs)

Another variant allocates interest payments between two classes of CMOs. One class (“Floaters”) receives a share of interest payments based upon a market index such as the London Interbank Offered Rate (LIBOR). The other class (“Inverse Floaters”) receives any remaining interest payments from the underlying mortgages. Floater classes receive more interest (and Inverse Floater classes receive correspondingly less interest) as interest rates rise. This shifts prepayment and interest rate risks from the Floater to the Inverse Floater class, reducing the price volatility of the Floater class and increasing the price volatility of the Inverse Floater class.

Z Classes and Residual Classes (Types of CMOs)

CMOs must allocate all payments received from the underlying mortgages to some class. To capture any unallocated payments, CMOs generally have an accrual (Z) class. Z classes do not receive any payments from the underlying mortgages until all other CMO classes have been paid off. Once this happens, holders of Z class CMOs receive all payments and prepayments.

Zero-Coupon Securities (A Fixed-Income Security)

Zero-coupon securities do not pay interest or principal until final maturity unlike debt securities that provide periodic payments of interest (referred to as a coupon payment). Investors buy zero-coupon securities at a price below the amount payable at maturity. The difference between the purchase price and the amount paid at maturity represents interest on the zero-coupon security. Investors must wait until maturity to receive interest and principal, which increases the interest rate and credit risks of a zero-coupon security. A zero-coupon, step-up security converts to a coupon security before final maturity.

There are many forms of zero-coupon securities. Some are issued at a discount and are referred to as zero-coupon or capital appreciation bonds. Others are created from interest bearing bonds by separating the right to receive the bond’s coupon payments from the right to receive the bond’s principal due at maturity, a process known as coupon stripping. Treasury STRIPs, IOs and POs are the most common forms of stripped, zero-coupon securities. In addition, some securities give the issuer the option to deliver additional securities in place of cash interest payments, thereby increasing the amount payable at maturity. These are referred to as pay-in-kind or PIK securities.

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Derivative Contracts

Derivative contracts are financial instruments that require payments based upon changes in the values of designated securities, commodities, currencies, indices or other assets or instruments including other derivative contracts (each a “Reference Instrument” and collectively, “Reference Instruments”). Each party to a derivative contract is referred to as a counterparty. Some derivative contracts require payments relating to an actual, future trade involving the Reference Instrument. These types of derivatives are frequently referred to as “physically settled” derivatives. Other derivative contracts require payments relating to the income or returns from, or changes in the market value of, a Reference Instrument. These types of derivatives are known as “cash settled” derivatives, since they require cash payments in lieu of delivery of the Reference Instrument.

Many derivative contracts are traded on securities or commodities exchanges. In this case, the exchange sets all the terms of the contract except for the price. Investors make payments due under their contracts through the exchange. Most exchanges require investors to maintain margin accounts through their brokers to cover their potential obligations to the exchange. Parties to the contract make (or collect) daily payments to the margin accounts to reflect losses (or gains) in the value of their contracts. This protects investors against potential defaults by the counterparty. Trading contracts on an exchange also allows investors to close out their contracts by entering into offsetting contracts.

For example, the Fund could close out an open contract to buy an asset at a future date by entering into an offsetting contract to sell the same asset on the same date. If the offsetting sale price is more than the original purchase price, the Fund realizes a gain; if it is less, the Fund realizes a loss. Exchanges may limit the amount of open contracts permitted at any one time. Such limits may prevent the Fund from closing out a position. If this happens, the Fund will be required to keep the contract open (even if it is losing money on the contract), and to make any payments required under the contract (even if it has to sell portfolio securities at unfavorable prices to do so). Inability to close out a contract could also harm the Fund by preventing it from disposing of or trading any assets it has been using to secure its obligations under the contract.

The Fund may also trade derivative contracts over-the-counter (OTC) in transactions negotiated directly between the Fund and the counterparty. OTC contracts do not necessarily have standard terms, so they may be less liquid and more difficult to close-out than exchange-traded contracts. In addition, OTC contracts with more specialized terms may be more difficult to value than exchange-traded contracts, especially in times of financial stress.

Depending on how the Fund uses derivative contracts and the relationships between the market value of a derivative contract and the Reference Instrument, derivative contracts may increase or decrease the Fund’s exposure to the risks of the Reference Instrument, and may also expose the fund to liquidity and leverage risks. OTC contracts also expose the Fund to credit risks in the event that a counterparty defaults on the contract.

The Fund may invest in a derivative contract if it is permitted to own, invest in or otherwise have economic exposure to the Reference Instrument. The Fund is not required to own a Reference Instrument in order to buy or sell a derivative contract relating to that Reference Instrument. The Fund may trade in the following specific types and/or combinations of derivative contracts:

Futures Contracts (A Type of Derivative)

Futures contracts provide for the future sale by one party and purchase by another party of a specified amount of a Reference Instrument at a specified price, date and time. Entering into a contract to buy a Reference Instrument is commonly referred to as buying a contract or holding a long position in the asset. Entering into a contract to sell a Reference Instrument is commonly referred to as selling a contract or holding a short position in the Reference Instrument. Futures contracts are considered to be commodity contracts. The Fund has claimed an exclusion from the definition of the term “commodity pool operator” under the Commodity Exchange Act and, therefore, is not subject to registration or regulation as a commodity pool operator under that Act. Futures contracts traded OTC are frequently referred to as forward contracts. The Fund can buy or sell financial futures (such as interest rate futures, index futures and security futures).

Interest Rate Futures

An interest rate futures contract is an exchange-traded contract for which the Reference Instrument is an interest-bearing, fixed-income security or an inter-bank deposit. Two examples of common interest rate futures contracts are U.S. Treasury futures contracts and Eurodollar futures contracts. The Reference Instrument for a U.S. Treasury futures contract is a U.S. Treasury security. The Reference Instrument for a Eurodollar futures contract is the London Interbank Offered Rate (commonly referred to as LIBOR). Eurodollar futures contracts enable the purchaser to obtain a fixed rate for the lending of funds over a stated period of time and the seller to obtain a fixed rate for a borrowing of funds over that same period.

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Index Futures

An index futures contract is an exchange-traded contract to make or receive a payment based upon changes in the value of an index. An index is a statistical composite that measures changes in the value of designated Reference Instruments. An index is usually computed by a sum product of a list of the designated Reference Instruments’ current prices and a list of weights assigned to these Reference Instruments.

Security Futures

A security futures contract is an exchange-traded contract to purchase or sell in the future a specific quantity of a security (other than a Treasury security) or a narrow-based securities index at a certain price. Presently, the only available security futures contracts use shares of a single equity security as the Reference Instrument. However, it is possible that in the future security futures contracts will be developed that use a single fixed-income security as the Reference Instrument.

Option Contracts (A Type of Derivative)

Option contracts (also called “options”) are rights to buy or sell a Reference Instrument for a specified price (the “exercise price”) during, or at the end of, a specified period. The seller (or writer) of the option receives a payment, or premium, from the buyer, which the writer keeps regardless of whether the buyer uses (or exercises) the option. Options can trade on exchanges or in the OTC market and may be bought or sold on a wide variety of Reference Instruments. Options that are written on futures contracts will be subject to margin requirements similar to those applied to futures contracts.

The Fund may buy and/or sell the following types of options:

Call Options

A call option gives the holder (buyer) the right to buy the Reference Instrument from the seller (writer) of the option. The Fund may use call options in the following ways:

• Buy call options on a Reference Instrument in anticipation of an increase in the value of the Reference Instrument; and
• Write call options on a Reference Instrument to generate income from premiums and in anticipation of a decrease or only limited increase in the value of the Reference Instrument. If the Fund writes a call option on a Reference Instrument that it owns and that call option is exercised, the Fund foregoes any possible profit from an increase in the market price of the Reference Instrument over the exercise price plus the premium received.

Put Options

A put option gives the holder the right to sell the Reference Instrument to the writer of the option. The Fund may use put options in the following ways:

• Buy put options on a Reference Instrument in anticipation of a decrease in the value of the Reference Instrument; and
• Write put options on a Reference Instrument to generate income from premiums, and in anticipation of an increase or only limited decrease in the value of the Reference Instrument. In writing puts, there is a risk that the Fund may be required to take delivery of the Reference Instrument when its current market price is lower than the exercise price.

The Fund may also buy or write options, as needed, to close out existing option positions.

Finally, the Fund may enter into combinations of options contracts in an attempt to benefit from changes in the prices of those options contracts (without regard to changes in the value of the Reference Instrument).

Swap Contracts (A Type of Derivative)

A swap contract (also known as a “swap”) is a type of derivative contract in which two parties agree to pay each other (swap) the returns derived from Reference Instruments. Most swaps do not involve the delivery of the underlying assets by either party, and the parties might not own the Reference Instruments. The payments are usually made on a net basis so that, on any given day, the Fund would receive (or pay) only the amount by which its payment under the contract is less than (or exceeds) the amount of the other party’s payment. Swap agreements are sophisticated instruments that can take many different forms and are known by a variety of names. Common swap agreements that the Fund may use include:

Interest-Rate Swaps

Interest rate swaps are contracts in which one party agrees to make regular payments equal to a fixed or floating interest rate times a stated principal amount (commonly referred to as a “notional principal amount”) in return for payments equal to a different fixed or floating rate times the same principal amount, for a specific period. For example, a $10 million London Interbank Offered Rate (commonly referred to as LIBOR) swap would require one party to pay the equivalent of the London Interbank Offered Rate of interest (which fluctuates) on $10 million principal amount in exchange for the right to receive the equivalent of a stated fixed rate of interest on $10 million principal amount.

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Caps and Floors (A Type of Swap Contract)

Caps and Floors are contracts in which one party agrees to make payments only if an interest rate or index goes above (Cap) or below (Floor) a certain level in return for a fee from the other party.

Total Return Swaps

A total return swap is an agreement between two parties whereby one party agrees to make payments of the total return from a Reference Instrument (or a basket of such instruments) during the specified period, in return for payments equal to a fixed or floating rate of interest or the total return from another Reference Instrument. Alternately, a total return swap can be structured so that one party will make payments to the other party if the value of a Reference Instrument increases, but receive payments from the other party if the value of that instrument decreases.

Other Investments, Transactions, Techniques

Reverse Repurchase Agreements (A Fixed-Income Security)

Reverse repurchase agreements are repurchase agreements in which the Fund is the seller (rather than the buyer) of the securities, and agrees to repurchase them at an agreed-upon time and price. A reverse repurchase agreement may be viewed as a type of borrowing by the Fund. Reverse repurchase agreements are subject to credit risks. In addition, reverse repurchase agreements create leverage risks because the Fund must repurchase the underlying security at a higher price, regardless of the market value of the security at the time of repurchase. The Fund may borrow an amount up to one third of the Fund’s net assets (exclusive of such borrowings) for leverage purposes.

Hedging

Hedging transactions are intended to reduce specific risks. For example, to protect the Fund against circumstances that would normally cause the Fund’s portfolio securities to decline in value, the Fund may buy or sell a derivative contract that would normally increase in value under the same circumstances. The Fund may also attempt to hedge by using combinations of different derivative contracts, or derivative contracts and securities. The Fund’s ability to hedge may be limited by the costs of the derivative contracts. The Fund may attempt to lower the cost of hedging by entering into transactions that provide only limited protection, including transactions that: (1) hedge only a portion of its portfolio; (2) use derivative contracts that cover a narrow range of circumstances; or (3) involve the sale of derivative contracts with different terms. Consequently, hedging transactions will not eliminate risk even if they work as intended. In addition, hedging strategies are not always successful, and could result in increased expenses and losses to the Fund.

Securities Lending

The Fund may lend portfolio securities to borrowers that the Adviser deems creditworthy. In return, the Fund receives cash or liquid securities from the borrower as collateral. The borrower must furnish additional collateral if the market value of the loaned securities increases. Also, the borrower must pay the Fund the equivalent of any dividends or interest received on the loaned securities.

The Fund will reinvest cash collateral in securities that qualify as an acceptable investment for the Fund. However, the Fund must pay interest to the borrower for the use of cash collateral.

Loans are subject to termination at the option of the Fund or the borrower. The Fund will not have the right to vote on securities while they are on loan. However, the Fund will attempt to terminate a loan in an effort to reacquire the securities in time to vote on matters that are deemed to be material by the Adviser. There can be no assurance that the Fund will have sufficient notice of such matters to be able to terminate the loan in time to vote thereon. The Fund may pay administrative and custodial fees in connection with a loan and may pay a negotiated portion of the interest earned on the cash collateral to a securities lending agent or broker.

Securities lending activities are subject to interest rate risks and counterparty credit risks.

Asset Segregation

In accordance with the Securities and Exchange Commission (SEC) and SEC staff positions regarding the interpretation of the Investment Company Act of 1940 (“1940 Act”), with respect to derivatives that create a future payment obligation of the Fund, the Fund must “set aside” (referred to sometimes as “asset segregation”) liquid assets, or engage in other SEC- or staff-approved measures, while the derivative contracts are open. For example, with respect to forwards and futures contracts that are not contractually required to “cash-settle,” the Fund must cover its open positions by setting aside cash or readily marketable securities equal to the contracts’ full, notional value. With respect to forwards and futures that are contractually required to “cash-settle,” however, the Fund is permitted to set aside cash or readily marketable securities in an amount equal to the Fund’s daily marked-to-market (net) obligations, if any (i.e., the Fund’s daily net liability, if any), rather than the notional value.

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The Fund will employ another approach to segregating assets to cover options that it sells. If the Fund sells a call option, the Fund will set aside either the Reference Instrument subject to the option, cash or readily marketable securities with a value that equals or exceeds the current market value of the Reference Instrument. In no event, will the value of the cash or readily marketable securities set aside by the Fund be less than the exercise price of the call option. If the Fund sells a put option, the Fund will set aside cash or readily marketable securities with a value that equals or exceeds the exercise price of the put option.

The Fund’s asset segregation approach for swap agreements varies among different types of swaps. For example, if the Fund enters into a credit default swap as the Protection Buyer, then it will set aside cash or readily marketable securities necessary to meet any accrued payment obligations under the swap. By comparison, if the Fund enters into a credit default swap as the Protection Seller, then the Fund will set aside cash or readily marketable securities equal to the full notional amount of the swap that must be paid upon the occurrence of a Credit Event. For some other types of swaps, such as interest rate swaps, the Fund will calculate the obligations of the counterparties to the swap on a net basis. Consequently, the Fund’s current obligation (or rights) under this type of swap will equal only the net amount to be paid or received based on the relative values of the positions held by each counterparty to the swap (the “net amount”). The net amount currently owed by or to the Fund will be accrued daily and the Fund will set aside cash or readily marketable securities equal to any accrued but unpaid net amount owed by the Fund underthe swap.

The Fund may reduce the liquid assets segregated to cover obligations under a derivative contract by entering into an offsetting derivative contract. For example, if the Fund sells a put option for the same Reference Instrument as a call option the Fund has sold, and the exercise price of the call option is the same as or higher than the exercise price of the put option, then the Fund may net its obligations under the options and set aside cash or readily marketable securities (including any margin deposited for the options) with a value equal to the greater of: (a) the current market value of the Reference Instrument deliverable under the call option; or (b) the exercise price of the put option.

By setting aside cash or readily marketable securities equal to only its net obligations under swaps and certain cash-settled derivative contracts, the Fund will have the ability to employ leverage to a greater extent than if the Fund were required to segregate cash or readily marketable securities equal to the full notional value of such contracts. The use of leverage involves certain risks. See “Risk Factors.” Unless the Fund has other cash or readily marketable securities to set aside, it cannot trade assets set aside in connection with derivative contracts or special transactions without entering into an offsetting derivative contract or terminating a special transaction. This may cause the Fund to miss favorable trading opportunities or to realize losses on derivative contracts or special transactions. The Fund reserves the right to modify its asset segregation policies in the future to comply with any changes in the positions articulated from time to time by the SEC and its staff.

Generally, special transactions do not cash-settle on a net basis. Consequently, with respect to special transactions, the Fund will set aside cash or readily marketable securities with a value that equals or exceeds the Fund’s obligations.

Investing in Securities of Other Investment Companies

The Fund may invest its assets in securities of other investment companies, including the securities of affiliated money market funds, as an efficient means of implementing its investment strategies and/or managing its uninvested cash. The Fund may also invest in mortgage-backed securities primarily by investing in another investment company (which is not available for general investment by the public) that owns those securities and that is advised by an affiliate of the Adviser. The Fund may also invest in such securities directly. These other investment companies are managed independently of the Fund and incur additional fees and/or expenses which would, therefore, be borne indirectly by the Fund in connection with any such investment. However, the Adviser believes that the benefits and efficiencies of this approach should outweigh the potential additional fees and/or expenses.

Inter-Fund Borrowing and Lending Arrangements

The Securities and Exchange Commission (SEC) has granted an exemption that permits the Fund and all other funds advised by subsidiaries of Federated Investors, Inc. (“Federated funds”) to lend and borrow money for certain temporary purposes directly to and from other Federated funds. Participation in this inter-fund lending program is voluntary for both borrowing and lending Federated funds, and an inter-fund loan is only made if it benefits each participating Federated fund. Federated Investors, Inc. (“Federated”) administers the program according to procedures approved by the Fund’s Board, and the Board monitors the operation of the program. Any inter-fund loan must comply with certain conditions set out in the exemption, which are designed to assure fairness and protect all participating Federated funds.

For example, inter-fund lending is permitted only: (a) to meet shareholder redemption requests; and (b) to meet commitments arising from “failed” trades; and (c) for other temporary purposes. All inter-fund loans must be repaid in seven days or less. The Fund’s participation in this program must be consistent with its investment policies and limitations, and must meet certain percentage tests. Inter-fund loans may be made only when the rate of interest to be charged is more attractive to the lending

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Federated fund than market-competitive rates on overnight repurchase agreements (“Repo Rate”) and more attractive to the borrowing Federated fund than the rate of interest that would be charged by an unaffiliated bank for short-term borrowings (“Bank Loan Rate”), as determined by the Board. The interest rate imposed on inter-fund loans is the average of the Repo Rate and the Bank Loan Rate.

Investment Risks

There are many risk factors which may affect an investment in the Fund. The Fund’s principal risks are described in its Prospectus. The following information is either additional information in respect of a principal risk factor referenced in the Prospectus or information in respect of an additional risk factor applicable to the Fund (in which case there is no related disclosure in the Prospectus).

Call Risks

Call risk is the possibility that an issuer may redeem a fixed-income security before maturity (a call) at a price below its current market price. An increase in the likelihood of a call may reduce the security’s price.

If a fixed-income security is called, the Fund may have to reinvest the proceeds in other fixed-income securities with lower interest rates, higher credit risks or other less favorable characteristics.

Credit Risks

Credit risk is the possibility that an issuer will default on a security by failing to pay interest or principal when due. If an issuer defaults, the Fund will lose money.

Risks of Investing in Derivative Contracts and Hybrid Instruments

The Fund’s exposure to derivative contracts and hybrid instruments (either directly or through its investment in another investment company) involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. First, changes in the value of the derivative contracts and hybrid instruments in which the Fund invests may not be correlated with changes in the value of the underlying Reference Instruments or, if they are correlated, may move in the opposite direction than originally anticipated. Second, while some strategies involving derivatives may reduce the risk of loss, they may also reduce potential gains or, in some cases, result in losses by offsetting favorable price movements in portfolio holdings. Third, there is a risk that derivative contracts and hybrid instruments may be erroneously priced or improperly valued and, as a result, the Fund may need to make increased cash payments to the counterparty. Fourth, exposure to derivative contracts and hybrid instruments may have tax consequences to the Fund and its shareholders. For example, derivative contracts and hybrid instruments may cause the Fund to realize increased ordinary income or short-term capital gains (which are treated as ordinary income for Federal income tax purposes) and, as a result, may increase taxable distributions to shareholders. In addition, under certain circumstances certain derivative contracts and hybrid instruments may cause the Fund to: a) incur an excise tax on a portion of the income related to those contracts and instruments; and/or b) reclassify, as a return of capital, some or all of the distribution previously made to shareholder during the fiscal year as dividend income. Fifth, a common provision in OTC derivative contracts permits the counterparty to terminate any such contract between it and the Fund, if the value of the Fund’s total net assets declines below a specified level over a given time period. Factors that may contribute to such a decline (which usually must be substantial) include significant shareholder redemptions and/or a marked decrease in the market value of the Fund’s investments. Any such termination of the Fund’s OTC derivative contracts may adversely affect the Fund (for example, by increasing losses and/or costs, and/or preventing the Fund from fully implementing its investment strategies). Sixth, the Fund may use a derivative contract to benefit from a decline in the value of a Reference Instrument. If the value of the Reference Instrument declines during the term of the contract, the Fund makes a profit on the difference (less any payments the Fund is required to pay under the terms of the contract). Any such strategy involves risk. There is no assurance that the Reference Instrument will decline in value during the term of the contract and make a profit for the Fund. The Reference Instrument may instead appreciate in value, creating a loss for the Fund. Finally, derivative contracts and hybrid instruments may also involve other risks described herein or in the Fund’s Prospectus, such as interest rate, credit, liquidity and leverage risks.

Risks Associated with the Investment Activities of Other Accounts

Investment decisions for the Fund are made independently from those of other accounts managed by the Adviser and accounts managed by affiliates of the Adviser. Therefore, it is possible that investment-related actions taken by such other accounts could adversely impact the Fund with respect to, for example, the value of Fund portfolio holdings, and/or prices paid to or received by the Fund on its portfolio transactions, and/or the Fund’s ability to obtain or dispose of portfolio securities. Related considerations are discussed elsewhere in this SAI under “Brokerage Transactions and Investment Allocation.”

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Investment Objective (and Policies) and Investment Limitations

Investment Objective

The Fund’s investment objective is to provide total return. The investment objective may not be changed by the Fund’s Board of Trustees without shareholder approval.

Investment Limitations

Diversification

With respect to securities comprising 75% of the value of its total assets, the Fund will not purchase securities of any one issuer (other than cash; cash items; securities issued or guaranteed by the government of the United States or its agencies or instrumentalities and repurchase agreements collateralized by such U.S. government securities; and securities of other investment companies) if, as a result, more than 5% of the value of its total assets would be invested in the securities of that issuer, or the Fund would own more than 10% of the outstanding voting securities of that issuer.

Borrowing Money and Issuing Senior Securities

The Fund may borrow money, directly or indirectly, and issue senior securities to the maximum extent permitted under the Investment Company Act of 1940 (“1940 Act”).

Investing in Real Estate

The Fund may not purchase or sell real estate, provided that this restriction does not prevent the Fund from investing in issuers which invest, deal or otherwise engage in transactions in real estate or interests therein, or investing in securities that are secured by real estate or interests therein. The Fund may exercise its rights under agreements relating to such securities, including the right to enforce security interests and to hold real estate acquired by reason of such enforcement until that real estate can be liquidated in an orderly manner.

Investing in Commodities

The Fund may not purchase or sell physical commodities, provided that the Fund may purchase securities of companies that deal in commodities. For purposes of this restriction, investments in transactions involving futures contracts and options, forward currency contracts, swap transactions and other financial contracts that settle by payment of cash are not deemed to be investments in commodities.

Underwriting

The Fund may not underwrite the securities of other issuers, except that the Fund may engage in transactions involving the acquisition, disposition or resale of its portfolio securities, under circumstances where it may be considered to be an underwriter under the Securities Act of 1933.

Lending

The Fund may not make loans, provided that this restriction does not prevent the Fund from purchasing debt obligations, entering into repurchase agreements, lending its assets to broker/dealers or institutional investors and investing in loans, including assignments and participation interests.

Concentration

The Fund will not make investments that will result in the concentration of its investments in the securities of issuers primarily engaged in the same industry. Government securities, municipal securities and bank instruments will not be deemed to constitute an industry.

The above limitations cannot be changed unless authorized by the Board and by the “vote of a majority of its outstanding voting securities,” as defined by the 1940 Act. The following limitations, however, may be changed by the Board without shareholder approval. Shareholders will be notified before any material change in these limitations becomes effective.

Securities Lending

The Fund may lend portfolio securities up to one-third of the value of its total assets to broker/dealers, banks or other institutional borrowers of securities. The Fund will only enter into loan arrangements with broker/dealers, banks or other institutions which the Adviser has determined are creditworthy under guidelines established by the Fund’s Board. The Fund will receive collateral in the form of cash or U.S. government securities equal to at least 100% of the value of the securities loaned.

The collateral received when the Fund lends portfolio securities must be valued daily and, should the market value of the loaned securities increase, the borrower must furnish additional collateral to the Fund.

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Illiquid Securities

The Fund will not purchase securities for which there is no readily available market, or enter into repurchase agreements or purchase time deposits that the fund cannot dispose of within seven days, if immediately after and as a result, the value of such securities would exceed, in the aggregate, 15% of the Fund’s net assets.

Investing in Other Investment Companies

The Fund may invest its assets in securities of other investment companies, including affiliated investment companies, as an efficient means of carrying out its investment policies. It should be noted that investment companies incur certain expenses, such as management fees, and, therefore, any investment by the Fund in shares of other investment companies may be subject to such duplicate expenses.

Buying Securities on Margin

The Fund will not purchase securities on margin, provided that the Fund may obtain short-term credits necessary for the clearance of purchases and sales of securities, and further provided that the Fund may make margin deposits in connection with its use of financial options and futures, forward and spot currency contracts, swap transactions and other financial contracts or derivative instruments.

Pledging Assets

The Fund will not mortgage, pledge or hypothecate any of its assets, provided that this shall not apply to the transfer of securities in connection with any permissible borrowing or to collateral arrangements in connection with permissible activities.

Additional Information

For purposes of the above limitations, the Fund considers certificates of deposit and demand and time deposits issued by a U.S. branch of a domestic bank or savings association having capital, surplus and undivided profits in excess of $100,000,000 at the time of investment to be “cash items” and “bank instruments.” Except with respect to borrowing money, if a percentage limitations is adhered to at the time of investment, a later increase or decrease in percentage resulting from any change in value or net assets will not result in a violation of such limitation.

What Do Shares Cost?

Determining Market Value of Securities

A Share’s net asset value (NAV) is determined as of the end of regular trading on the New York Stock Exchange (NYSE) (normally 4:00 p.m. Eastern time) each day the NYSE is open. The Fund calculates the NAV of each class by valuing the assets allocated to the Share’s class, subtracting the liabilities allocated to the class and dividing the balance by the number of Shares of the class outstanding. The NAV for each class of Shares may differ due to the variance in daily net income realized by each class. Such variance will reflect only accrued net income to which the Shareholders of a particular class are entitled. The NAV is calculated to the nearest whole cent per Share.

In calculating its NAV, the Fund generally values investments as follows:

• Equity securities listed on a U.S. securities exchange or traded through the U.S. national market system are valued at their last reported sale price or official closing price in their principal exchange or market. If a price is not readily available, such equity securities are valued based upon the mean of closing bid and asked quotations from one or more dealers.
• Other equity securities traded primarily in the United States are valued based upon the mean of closing bid and asked quotations from one or more dealers.
• Equity securities traded primarily through securities exchanges and regulated market systems outside the United States are valued at their last reported sale price or official closing price in their principal exchange or market. These prices may be adjusted for significant events occurring after the closing of such exchanges or market systems as described below. If a price is not readily available, such equity securities are valued based upon the mean of closing bid and asked quotations from one or more dealers.
• Fixed-income securities and repurchase agreements acquired with remaining maturities of greater than 60 days are fair valued using price evaluations provided by a pricing service approved by the Board. The methods used by pricing services to determine such price evaluations are described below. If a price evaluation is not readily available, such fixed-income securities are fair valued based upon price evaluations from one or more dealers.
• Fixed-income securities and repurchase agreements acquired with remaining maturities of 60 days or less are valued at their amortized cost as described below.

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• Futures contracts listed on exchanges are valued at their reported settlement price. Option contracts listed on exchanges are valued based upon the mean of closing bid and asked quotations reported by the exchange or from one or more futures commission merchants.
• OTC derivative contracts are fair valued using price evaluations provided by various pricing services approved by the Board. The methods used by pricing services to determine such price evaluations are described below. If a price evaluation is not readily available, such derivative contracts are fair valued based upon price evaluations from one or more dealers or using a recognized pricing model for the contract.
• Shares of other mutual funds are valued based upon their reported NAVs. The prospectuses for these mutual funds explain the circumstances under which they will use fair value pricing and the effects of using fair value pricing.

If any price, quotation, price evaluation or other pricing source is not readily available when the NAV is calculated, the Fund uses the fair value of the investment determined in accordance with the procedures described below. There can be no assurance that the Fund could purchase or sell an investment at the price used to calculate the Fund’s NAV. The Fund will not use a pricing service or dealer who is an affiliated person of the Adviser to value investments.

Noninvestment assets and liabilities are valued in accordance with Generally Accepted Accounting Principles (GAAP). The NAV calculation includes expenses, dividend income, interest income and other income through the date of the calculation. Changes in holdings of investments and in the number of outstanding Shares are included in the calculation not later than the first business day following such change. Any assets or liabilities denominated in foreign currencies are converted into U.S. dollars using an exchange rate obtained from one or more currency dealers.

The Fund follows procedures that are common in the mutual fund industry regarding errors made in the calculation of its NAV. This means that, generally, the Fund will not correct errors of less than one cent per Share or errors that did not result in net dilution to the Fund.

Amortized Cost Values

Under the amortized cost valuation method, an investment is valued initially at its cost as determined in accordance with GAAP. The Fund then adjusts the amount of interest income accrued each day over the term of the investment to account for any difference between the initial cost of the investment and the amount payable at its maturity. If the amount payable at maturity exceeds the initial cost (a “discount”), then the daily accrual is increased; if the initial cost exceeds the amount payable at maturity (a “premium”), then the daily accrual is decreased. The Fund adds the amount of the increase to (in the case of a discount), or subtracts the amount of the decrease from (in the case of a premium), the investment’s cost each day. The Fund uses this adjusted cost to value the investment.

Fair Valuation and Significant Events Procedures

The Board has ultimate responsibility for determining the fair value of investments for which market quotations are not readily available. The Board has appointed a Valuation Committee comprised of officers of the Fund and of the Adviser to assist in this responsibility and in overseeing the calculation of the NAV. The Board has also authorized the use of pricing services recommended by the Valuation Committee to provide price evaluations of the current fair value of certain investments for purposes of calculating the NAV.

Pricing Service Valuations. Based on the recommendations of the Valuation Committee, the Board has authorized the Fund to use pricing services that provide daily fair value evaluations of the current value of certain investments, primarily fixed-income securities and OTC derivatives contracts. Different pricing services may provide different price evaluations for the same security because of differences in their methods of evaluating market values. Factors considered by pricing services in evaluating an investment include the yields or prices of investments of comparable quality, coupon, maturity, call rights and other potential prepayments, terms and type, reported transactions, indications as to values from dealers and general market conditions. A pricing service may find it more difficult to apply these and other factors to relatively illiquid or volatile investments, which may result in less frequent or more significant changes in the price evaluations of these investments. If a pricing service determines that it does not have sufficient information to use its standard methodology, it may evaluate an investment based on the present value of what investors can reasonably expect to receive from the issuer’s operations or liquidation.

Some pricing services provide a single price evaluation reflecting the bid-side of the market for an investment (a “bid” evaluation). Other pricing services offer both bid evaluations and price evaluations indicative of a price between the prices bid and asked for the investment (a “mid” evaluation). The Fund normally uses bid evaluations for U.S. Treasury and Agency securities, mortgage-backed securities and municipal securities. The Fund normally uses mid evaluations for other types of fixed-income securities and OTC derivative contracts.

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Fair Valuation Procedures. The Board has established procedures for determining the fair value of investments for which price evaluations from pricing services or dealers and market quotations are not readily available. The procedures define an investment’s “fair value” as the price that the Fund might reasonably expect to receive upon its current sale. The procedures assume that any sale would be made to a willing buyer in the ordinary course of trading. The procedures require consideration of factors that vary based on the type of investment and the information available. Factors that may be considered in determining an investment’s fair value include: (1) the last reported price at which the investment was traded; (2) information provided by dealers or investment analysts regarding the investment or the issuer; (3) changes in financial conditions and business prospects disclosed in the issuer’s financial statements and other reports; (4) publicly announced transactions (such as tender offers and mergers) involving the issuer; (5) comparisons to other investments or to financial indices that are correlated to the investment; (6) with respect to fixed-income investments, changes in market yields and spreads; (7) with respect to investments that have been suspended from trading, the circumstances leading to the suspension; and (8) other factors that might affect the investment’s value.

The Valuation Committee is responsible for the day-to-day implementation of these procedures. The Valuation Committee may also authorize the use of a financial valuation model to determine the fair value of a specific type of investment. The Board periodically reviews and approves the fair valuations made by the Valuation Committee and any changes made to the procedures.

Using fair value to price investments may result in a value that is different from an investment’s most recent closing price and from the prices used by other mutual funds to calculate their NAVs. The fair value of an investment will generally remain unchanged in the absence of new information relating to the investment or its issuer, such as changes in the issuer’s business or financial results, or relating to external market factors, such as trends in the market values of comparable securities. This may result in less frequent, and larger, changes in fair value prices as compared to prices based on market quotations or price evaluations from pricing services or dealers.

Significant Events. The Board has adopted procedures requiring an investment to be priced at its fair value whenever the Adviser determines that a significant event affecting the value of the investment has occurred between the time as of which the price of the investment would otherwise be determined and the time as of which the NAV is computed. An event is considered significant if there is both an affirmative expectation that the investment’s value will change in response to the event and a reasonable basis for quantifying the resulting change in value. Examples of significant events that may occur after the close of the principal market on which a security is traded, or the time of a price evaluation provided by a pricing service or a dealer, include:

• With respect to securities traded principally in foreign markets, significant trends in U.S. equity markets or in the trading of foreign securities index futures or options contracts;
• With respect to price evaluations of fixed-income securities determined before the close of regular trading on the NYSE, actions by the Federal Reserve Open Market Committee and other significant trends in U.S. fixed-income markets;
• Political or other developments affecting the economy or markets in which an issuer conducts its operations or its securities are traded; and
• Announcements concerning matters such as acquisitions, recapitalizations or litigation developments, or a natural disaster affecting the issuer’s operations or regulatory changes or market developments affecting the issuer’s industry.

The Valuation Committee uses a pricing service to determine the fair value of equity securities traded principally in foreign markets when the Adviser determines that there has been a significant trend in the U.S. equity markets or in index futures trading. The pricing service uses models that correlate changes between the closing and opening price of equity securities traded primarily in non-U.S. markets to changes in prices in U.S.-traded securities and derivative contracts. The pricing service seeks to employ the model that provides the most significant correlation based on a periodic review of the results. The model uses the correlation to adjust the reported closing price of a foreign equity security based on information available up to the close of the NYSE.

For other significant events, the Fund may seek to obtain more current quotations or price evaluations from alternative pricing sources. If a reliable alternative pricing source is not available, the fair value of the investment is determined using the methods discussed above in “Fair Valuation Procedures.” The Board has ultimate responsibility for any fair valuations made in response to a significant event.

How is the Fund Sold?

Under the Distributor’s Contract with the Fund, the Distributor (Federated Securities Corp.) offers Shares on a continuous, best-efforts basis.

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Rule 12b-1 Plan (INSTITUTIONAL SERVICE SHARES)

As a compensation-type plan, the Rule 12b-1 Plan is designed to pay the Distributor for activities principally intended to result in the sale of Shares such as advertising and marketing of Shares (including printing and distributing prospectuses and sales literature to prospective shareholders and financial intermediaries) and providing incentives to financial intermediaries to sell Shares. The Plan is also designed to cover the cost of administrative services performed in conjunction with the sale of Shares, including, but not limited to, shareholder services, recordkeeping services and educational services, as well as the costs of implementing and operating the Plan. The Rule 12b-1 Plan allows the Distributor to contract with financial intermediaries to perform activities covered by the Plan. The Rule 12b-1 Plan is expected to benefit the Fund in a number of ways. For example, it is anticipated that the Plan will help the Fund attract and retain assets, thus providing cash for orderly portfolio management and Share redemptions and possibly helping to stabilize or reduce other operating expenses.

In addition, the Plan is integral to the multiple class structure of the Fund, which promotes the sale of Shares by providing a range of options to investors. The Fund’s service providers that receive asset-based fees also benefit from stable or increasing Fund assets.

The Fund may compensate the Distributor more or less than its actual marketing expenses. In no event will the Fund pay for any expenses of the Distributor that exceed the maximum Rule 12b-1 Plan fee.

For some classes of shares, the maximum Rule 12b-1 Plan fee that can be paid in any one year may not be sufficient to cover the marketing-related expenses the Distributor has incurred. Therefore, it may take the Distributor a number of years to recoup these expenses.

Additional Payments To Financial Intermediaries

The Distributor may pay out of its own resources amounts (including items of material value) to certain financial intermediaries. In some cases, such payments may be made by, or funded from the resources of, companies affiliated with the Distributor (including the Adviser). While Financial Industry Regulatory Authority (FINRA) regulations limit the sales charges that you may bear, there are no limits with regard to the amounts that the Distributor may pay out of its own resources. In addition to the payments which are generally described herein and in the Prospectus, the financial intermediary also may receive payments under the Rule 12b-1 Plan and/or Service Fees. In connection with these payments, the financial intermediary may elevate the prominence or profile of the Fund and/or other Federated funds within the financial intermediary’s organization by, for example, placement on a list of preferred or recommended funds and/or granting the Distributor preferential or enhanced opportunities to promote the funds in various ways within the financial intermediary’s organization. You can ask your financial intermediary for information about any payments it receives from the Distributor or the Federated funds and any services provided.

The following examples illustrate the types of instances in which the Distributor may make additional payments to financial intermediaries.

Supplemental Payments

The Distributor may make supplemental payments to certain financial intermediaries that are holders or dealers of record for accounts in one or more of the Federated funds. These payments may be based on such factors as: the number or value of Shares the financial intermediary sells or may sell; the value of client assets invested; or the type and nature of services or support furnished by the financial intermediary.

Processing Support Payments

The Distributor may make payments to financial intermediaries that sell Federated fund shares to help offset their costs associated with client account maintenance support, statement processing and transaction processing. The types of payments that the Distributor may make under this category include: payment of ticket charges on a per-transaction basis; payment of networking fees; and payment for ancillary services such as setting up funds on the financial intermediary’s mutual fund trading system.

Retirement Plan Program Servicing Payments

The Distributor may make payments to certain financial intermediaries who sell Federated fund shares through retirement plan programs. A financial intermediary may perform retirement plan program services itself or may arrange with a third party to perform retirement plan program services. In addition to participant recordkeeping, reporting or transaction processing, retirement plan program services may include: services rendered to a plan in connection with fund/investment selection and monitoring; employee enrollment and education; plan balance rollover or separation; or other similar services.

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Other Benefits to Financial Intermediaries

From time to time, the Distributor, at its expense, may provide additional compensation to financial intermediaries that sell or arrange for the sale of Shares. Such compensation may include financial assistance to financial intermediaries that enable the Distributor to participate in or present at conferences or seminars, sales or training programs for invited employees, client and investor events and other financial intermediary-sponsored events.

The Distributor also may hold or sponsor, at its expense, sales events, conferences and programs for employees or associated persons of financial intermediaries and may pay the travel and lodging expenses of attendees. The Distributor also may provide, at its expense, meals and entertainment in conjunction with meetings with financial intermediaries. Other compensation may be offered to the extent not prohibited by applicable laws, regulations or the rules of any self-regulatory agency, such as FINRA.

Purchases In-Kind

You may contact the Distributor to request a purchase of Shares using securities you own. The Fund reserves the right to determine whether to accept your securities and the minimum market value to accept. The Fund will value your securities in the same manner as it values its assets. An in-kind purchase may be treated as a sale of your securities for federal tax purposes; please consult your tax adviser regarding potential tax liability.

Subaccounting Services

Certain financial intermediaries may wish to use the transfer agent’s subaccounting system to minimize their internal recordkeeping requirements. The transfer agent may charge a fee based on the level of subaccounting services rendered. Financial intermediaries holding Shares in a fiduciary, agency, custodial or similar capacity may charge or pass through subaccounting fees as part of or in addition to normal trust or agency account fees. They may also charge fees for other services that may be related to the ownership of Shares. This information should, therefore, be read together with any agreement between the customer and the financial intermediary about the services provided, the fees charged for those services and any restrictions and limitations imposed.

Redemption In-Kind

Although the Fund generally intends to pay Share redemptions in cash, it reserves the right, on its own initiative or in response to a shareholder request, to pay the redemption price in whole or in part by a distribution of the Fund’s portfolio securities.

Because the Fund has elected to be governed by Rule 18f-1 under the 1940 Act, the Fund is obligated to pay Share redemptions to any one shareholder in cash only up to the lesser of $250,000 or 1% of the net assets represented by such Share class during any 90-day period.

Any Share redemption payment greater than this amount will also be in cash unless the Fund elects to pay all or a portion of the remainder of the redemption in portfolio securities, valued in the same way as the Fund determines its NAV.

Redemption in-kind is not as liquid as a cash redemption. Shareholders receiving the portfolio securities could have difficulty selling them, may incur related transaction costs and would be subject to risks of fluctuations in the securities’ values prior to sale.

Account and Share Information

Voting Rights

Each Share of the Fund gives the shareholder one vote in Director elections and other matters submitted to shareholders for vote.

All Shares of the Fund have equal voting rights, except that in matters affecting only a particular class, only Shares of that class are entitled to vote.

Directors may be removed by the Board or by shareholders at a special meeting. A special meeting of shareholders will be called by the Board upon the written request of shareholders who own at least 10% of the Fund’s outstanding Shares of all series entitled to vote.

As of April 5, 2011, the following shareholders owned of record, beneficially, or both, 5% or more of outstanding Institutional Shares: Nationwide Trust Company, Columbus, OH, owned approximately 606,959 Shares (60.37%); FPB & Co., Russell, KY, owned approximately 102,324 Shares (10.17%); Suffolk County National Bank, Bohemia, NY, owned approximately 92,314 Shares (9.18%); and Treynor State Bank, Treynor, IA, owned approximately 84,469 Shares (8.40%).

As of April 5, 2011, the following shareholders owned of record, beneficially, or both, 5% or more of outstanding Institutional Service Shares: MLPF&S, Jacksonville, FL, owned approximately 436,723 Shares (18.26%); and RSBCO, Ruston, LA, owned approximately 242,212 Shares (10.12%).

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Shareholders owning 25% or more of outstanding Shares may be in control and be able to affect the outcome of certain matters presented for a vote of shareholders.

Nationwide Trust Company is organized in the state of Ohio and is a subsidiary of Nationwide Financial Services, Inc. organized in the state of Delaware. The ultimate parent company is Nationwide Mutual Insurance Company organized in the state of Ohio.

Tax Information

Federal Income Tax

The Fund intends to meet requirements of Subchapter M of the Internal Revenue Code (“Code”) applicable to regulated investment companies. If these requirements are not met, it will not receive special tax treatment and will be subject to federal corporate income tax.

The Fund is entitled to a loss carryforward, which may reduce the taxable income or gain that the Fund would realize, and to which the shareholder would be subject, in the future.

Who Manages and Provides Services to the Fund?

Board of Directors

The Board of Directors is responsible for managing the Fund’s business affairs and for exercising all the Fund’s powers except those reserved for the shareholders. The following tables give information about each Director and the senior officers of the Fund. Where required, the tables separately list Directors who are “interested persons” of the Fund (i.e., “Interested” Directors) and those who are not (i.e., “Independent” Directors). Unless otherwise noted, the address of each person listed is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, PA 15222. The address of all Independent Directors listed is 4000 Ericsson Drive, Warrendale, PA 15086-7561; Attention: Mutual Fund Board. As of December 31, 2010, the Fund comprised one portfolio, and the Federated Fund Complex consisted of 43 investment companies (comprising 136 portfolios). Unless otherwise noted, each Officer is elected annually. Unless otherwise noted, each Director oversees all portfolios in the Federated Fund Complex and serves for an indefinite term.

As of April 5, 2011, the Fund’s Board and Officers as a group owned less than 1% of the Fund’s outstanding Institutional Shares and Institutional Service Shares.

qualifications of Independent Directors

Individual Director qualifications are noted in the “Independent Directors Background and Compensation” chart. In addition, the following characteristics are among those that were considered for each existing Director and will be considered for any Nominee Director.

• Outstanding skills in disciplines deemed by the Independent Directors to be particularly relevant to the role of Independent Director and to the Federated Funds, including legal, accounting, business management, the financial industry generally and the investment industry particularly.
• Desire and availability to serve for a substantial period of time, taking into account the Board’s current mandatory retirement age of 73 years.
• No conflicts which would interfere with qualifying as independent.
• Appropriate interpersonal skills to work effectively with other Independent Directors.
• Understanding and appreciation of the important role occupied by Independent Directors in the regulatory structure governing regulated investment companies.
• Diversity of background.

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interested Directors Background and Compensation

Name Birth Date Positions Held with Fund Date Service Began	Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)	Aggregate Compensation From Fund (past fiscal year)	Total Compensation From Fund and Federated Fund Complex (past calendar year)
John F. Donahue* Birth Date: July 28, 1924 Director Began serving: April 1991	Principal Occupations: Director or Trustee of the Federated Fund Complex; Chairman and Director, Federated Investors, Inc.; Chairman of the Federated Fund Complex’s Executive Committee. Previous Positions: Chairman of the Federated Fund Complex; Trustee, Federated Investment Management Company; Chairman and Director, Federated Investment Counseling.	$0	$0
J. Christopher Donahue* Birth Date: April 11, 1949 President and Director Began serving: September 1999	Principal Occupations: Principal Executive Officer and President of the Federated Fund Complex; Director or Trustee of some of the Funds in the Federated Fund Complex; President, Chief Executive Officer and Director, Federated Investors, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman, Federated Equity Management Company of Pennsylvania and Passport Research, Ltd. (investment advisory subsidiary of Federated); Trustee, Federated Shareholder Services Company; Director, Federated Services Company. Previous Positions: President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd.	$0	$0

* Family relationships and reasons for “interested” status: John F. Donahue is the father of J. Christopher Donahue; both are “interested” due to their beneficial ownership of shares of Federated Investors, Inc. and the positions they hold with Federated and its subsidiaries.

Independent Directors Background, Qualifications and Compensation

Name Birth Date Positions Held with Fund Date Service Began	Principal Occupation(s) and Other Directorships Held for Past Five Years, Previous Position(s) and Qualifications	Aggregate Compensation From Fund (past fiscal year)	Total Compensation From Fund and Federated Fund Complex (past calendar year)
Nicholas P. Constantakis, CPA Birth Date: September 3, 1939 Director Began serving: February 1998	Principal Occupation: Director or Trustee of the Federated Fund Complex. Other Directorships Held: Director and Chairman of the Audit Committee, Michael Baker Corporation (architecture, engineering and construction services). Previous Position: Partner, Andersen Worldwide SC. Qualifications: Public accounting and director experience.	$1036.61	$247,500
John F. Cunningham Birth Date: March 5, 1943 Director Began serving: January 1999	Principal Occupation: Director or Trustee of the Federated Fund Complex. Other Directorships Held: Chairman, President and Chief Executive Officer, Cunningham & Co., Inc. (strategic business consulting); Trustee Associate, Boston College. Previous Positions: Director, Redgate Communications and EMC Corporation (computer storage systems); Chairman of the Board and Chief Executive Officer, Computer Consoles, Inc.; President and Chief Operating Officer, Wang Laboratories; Director, First National Bank of Boston; Director, Apollo Computer, Inc. Qualifications: Business management and director experience.	$942.36	$225,000

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Name Birth Date Positions Held with Fund Date Service Began	Principal Occupation(s) and Other Directorships Held for Past Five Years, Previous Position(s) and Qualifications	Aggregate Compensation From Fund (past fiscal year)	Total Compensation From Fund and Federated Fund Complex (past calendar year)
Maureen Lally-Green Birth Date: July 5, 1949 Director Began serving: August 2009	Principal Occupations: Director or Trustee of the Federated Fund Complex; Director, Office of Church Relations, Diocese of Pittsburgh; Adjunct Professor of Law, Duquesne University School of Law. Other Directorships Held: Director, Auberle; Trustee, St. Francis University; Director, Ireland Institute of Pittsburgh; Director, UPMC Mercy Hospital; Regent, St. Vincent Seminary; Director, Epilepsy Foundation of Western and Central Pennsylvania; Director, Saint Thomas More Society, Allegheny County; Director, Carlow University. Previous Position: Pennsylvania Superior Court Judge. Qualifications: Legal and director experience.	$942.36	$223,526.41
Peter E. Madden Birth Date: March 16, 1942 Director Began serving: October 1991	Principal Occupation: Director or Trustee, and Chairman of the Board of Directors or Trustees, of the Federated Fund Complex. Previous Positions: Representative, Commonwealth of Massachusetts General Court; President, Chief Operating Officer and Director, State Street Bank and Trust Company and State Street Corporation (retired); Director, VISA USA and VISA International; Chairman and Director, Massachusetts Bankers Association; Director, Depository Trust Corporation; Director, The Boston Stock Exchange. Qualifications: Business management, mutual fund services and director experience.	$1298.36	$310,000
Charles F. Mansfield, Jr. Birth Date: April 10, 1945 Director Began serving: September 1999	Principal Occupations: Director or Trustee and Chairman of the Audit Committee of the Federated Fund Complex; Management Consultant. Previous Positions: Chief Executive Officer, PBTC International Bank; Partner, Arthur Young & Company (now Ernst & Young LLP); Chief Financial Officer of Retail Banking Sector, Chase Manhattan Bank; Senior Vice President, HSBC Bank USA (formerly, Marine Midland Bank); Vice President, Citibank; Assistant Professor of Banking and Finance, Frank G. Zarb School of Business, Hofstra University; Executive Vice President DVC Group, Inc. (marketing, communications and technology). Qualifications: Banking, business management, education and director experience.	$1060.14	$253,125
R. James Nicholson Birth Date: February 4, 1938 Director Began serving: January 2008	Principal Occupations: Director or Trustee of the Federated Fund Complex; Senior Counsel, Brownstein Hyatt Farber Schrek, P.C.; Former Secretary of the U.S. Dept. of Veterans Affairs; Former U.S. Ambassador to the Holy See; Former Chairman of the Republican National Committee. Other Directorships Held: Director, Horatio Alger Association; Director, The Daniels Fund. Previous Positions: Colonel, U.S. Army Reserve; Partner, Calkins, Kramer, Grimshaw and Harring, P.C.; General Counsel, Colorado Association of Housing and Building; Chairman and CEO, Nicholson Enterprises, Inc. (real estate holding company); Chairman and CEO, Renaissance Homes of Colorado. Qualifications: Legal, government, business management and director experience.	$942.36	$223,526.41

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Name Birth Date Positions Held with Fund Date Service Began	Principal Occupation(s) and Other Directorships Held for Past Five Years, Previous Position(s) and Qualifications	Aggregate Compensation From Fund (past fiscal year)	Total Compensation From Fund and Federated Fund Complex (past calendar year)
Thomas M. O’Neill Birth Date: June 14, 1951 Director Began serving: October 2006	Principal Occupations: Director or Trustee of the Federated Fund Complex; Sole Proprietor, Navigator Management Company (investment and strategic consulting). Other Directorships Held: Board of Overseers, Children’s Hospital of Boston; Visiting Committee on Athletics, Harvard College. Previous Positions: Chief Executive Officer and President, Managing Director and Chief Investment Officer, Fleet Investment Advisors; President and Chief Executive Officer, Aeltus Investment Management, Inc.; General Partner, Hellman, Jordan Management Co., Boston, MA; Chief Investment Officer, The Putnam Companies, Boston, MA; Credit Analyst and Lending Officer, Fleet Bank; Director and Consultant, EZE Castle Software (investment order management software); Director, Midway Pacific (lumber). Qualifications: Business management, mutual fund, director and investment experience.	$1036.61	$247,500
John S. Walsh Birth Date: November 28, 1957 Director Began serving: September 1999	Principal Occupations: Director or Trustee of the Federated Fund Complex; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. Previous Position: Vice President, Walsh & Kelly, Inc. Qualifications: Business management and director experience.	$1036.61	$247,500
James F. Will Birth Date: October 12, 1938 Director Began serving: April 2006	Principal Occupations: Director or Trustee of the Federated Fund Complex; formerly, Vice Chancellor and President, Saint Vincent College. Other Directorships Held: Trustee, Saint Vincent College; Director, Alleghany Corporation; Trustee, Wheeling Jesuit University; Director, Liberty Tire Recycling. Previous Positions: Chairman, President and Chief Executive Officer, Armco, Inc.; President and Chief Executive Officer, Cyclops Industries; President and Chief Operating Officer, Kaiser Steel Corporation. Qualifications: Business management, education and director experience.	$942.36	$225,000

OFFICERS**

Name Birth Date Positions Held with Fund Date Service Began	Principal Occupation(s) and Previous Position(s)
John W. McGonigle Birth Date: October 26, 1938 EXECUTIVE VICE PRESIDENT AND SECRETARY Began serving: March 1991	Principal Occupations: Executive Vice President and Secretary of the Federated Fund Complex; Vice Chairman, Executive Vice President, Secretary and Director, Federated Investors, Inc. Previous Positions: Trustee, Federated Investment Management Company and Federated Investment Counseling; Director, Federated Global Investment Management Corp., Federated Services Company and Federated Securities Corp.
Richard A. Novak Birth Date: December 25, 1963 TREASURER Began serving: January 2006	Principal Occupations: Principal Financial Officer and Treasurer of the Federated Fund Complex; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc. Previous Positions: Controller of Federated Investors, Inc.; Vice President, Finance of Federated Services Company; held various financial management positions within The Mercy Hospital of Pittsburgh; Auditor, Arthur Andersen & Co.
Richard B. Fisher Birth Date: May 17, 1923 Vice Chairman Began serving: August 2002	Principal Occupations: Vice Chairman or Vice President of some of the Funds in the Federated Fund Complex; Vice Chairman, Federated Investors, Inc.; Chairman, Federated Securities Corp. Previous Positions: President and Director or Trustee of some of the Funds in the Federated Fund Complex; Executive Vice President, Federated Investors, Inc.; Director and Chief Executive Officer, Federated Securities Corp.

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Name Birth Date Positions Held with Fund Date Service Began	Principal Occupation(s) and Previous Position(s)
Brian P. Bouda Birth Date: February 28, 1947 CHIEF COMPLIANCE OFFICER AND SENIOR VICE PRESIDENT Began serving: August 2004	Principal Occupations: Senior Vice President and Chief Compliance Officer of the Federated Fund Complex; Vice President and Chief Compliance Officer of Federated Investors, Inc. and Chief Compliance Officer of its subsidiaries. Mr. Bouda joined Federated in 1999 and is a member of the American Bar Association and the State Bar Association of Wisconsin.
Robert J. Ostrowski Birth Date: April 26, 1963 Chief Investment Officer Began serving: May 2004	Principal Occupations: Robert J. Ostrowski joined Federated in 1987 as an Investment Analyst and became a Portfolio Manager in 1990. He was named Chief Investment Officer of taxable fixed-income products in 2004 and also serves as a Senior Portfolio Manager. Mr. Ostrowski became an Executive Vice President of the Fund’s Adviser in 2009 and served as a Senior Vice President of the Fund’s Adviser from 1997 to 2009. Mr. Ostrowski has received the Chartered Financial Analyst designation. He received his M.S. in Industrial Administration from Carnegie Mellon University.
Todd A. Abraham Birth Date: February 10, 1966 VICE PRESIDENT Began serving: November 1998	Principal Occupations: Todd A. Abraham is Vice President of the Fund. Mr. Abraham became a Portfolio Manager in 1995 , a Vice President of the Fund’s Adviser in 1997 and a Senior Vice President of the Fund’s Adviser beginning 2007. Mr. Abraham joined Federated in 1993 as an Investment Analyst and served as Assistant Vice President of the Fund’s Adviser from 1995 to 1997. Mr. Abraham served as a Portfolio Analyst at Ryland Mortgage Co. from 1992-1993. Mr. Abraham has received the Chartered Financial Analyst designation and holds an M.B.A. in Finance from Loyola College.

** Officers do not receive any compensation from the Fund.

In addition, the Fund has appointed an Anti-Money-Laundering Compliance Officer.

BOARD LEADERSHIP STRUCTURE

As required under the terms of certain regulatory settlements, the Chairman of the Board is not an interested person of the Fund and neither the Chairman, nor any firm with which the Chairman is affiliated, has a prior relationship with Federated or its affiliates or (other than his position as a Director) with the Fund.

Committees of the Board

Board Committee	Committee Members	Committee Functions	Meetings Held During Last Fiscal Year
Executive	John F. Donahue Peter E. Madden John S. Walsh	In between meetings of the full Board, the Executive Committee generally may exercise all the powers of the full Board in the management and direction of the business and conduct of the affairs of the Fund in such manner as the Executive Committee shall deem to be in the best interests of the Fund. However, the Executive Committee cannot elect or remove Board members, increase or decrease the number of Directors, elect or remove any Officer, declare dividends, issue Shares or recommend to shareholders any action requiring shareholder approval.	Three
Audit	Nicholas P. Constantakis Charles F. Mansfield, Jr. Thomas M. O’Neill John S. Walsh	The purposes of the Audit Committee are to oversee the accounting and financial reporting process of the Fund, the Fund’s internal control over financial reporting and the quality, integrity and independent audit of the Fund’s financial statements. The Committee also oversees or assists the Board with the oversight of compliance with legal requirements relating to those matters, approves the engagement and reviews the qualifications, independence and performance of the Fund’s independent registered public accounting firm, acts as a liaison between the independent registered public accounting firm and the Board and reviews the Fund’s internal audit function.	Seven

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Board Committee	Committee Members	Committee Functions	Meetings Held During Last Fiscal Year
Nominating	Nicholas P. Constantakis John F. Cunningham Maureen Lally-Green Peter E. Madden Charles F. Mansfield, Jr. R. James Nicholson Thomas M. O’Neill John S. Walsh James F. Will	The Nominating Committee, whose members consist of all Independent Directors, selects and nominates persons for election to the Fund’s Board when vacancies occur. The Committee will consider candidates recommended by shareholders, Independent Directors, officers or employees of any of the Fund’s agents or service providers and counsel to the Fund. Any shareholder who desires to have an individual considered for nomination by the Committee must submit a recommendation in writing to the Secretary of the Fund, at the Fund’s address appearing on the back cover of this SAI. The recommendation should include the name and address of both the shareholder and the candidate and detailed information concerning the candidate’s qualifications and experience. In identifying and evaluating candidates for consideration, the Committee shall consider such factors as it deems appropriate. Those factors will ordinarily include: integrity, intelligence, collegiality, judgment, diversity, skill, business and other experience, qualification as an “Independent Director,” the existence of material relationships which may create the appearance of a lack of independence, financial or accounting knowledge and experience and dedication and willingness to devote the time and attention necessary to fulfill Board responsibilities.	Three

BOARD’S ROLE IN RISK OVERSIGHT

The Board’s role in overseeing the Fund’s general risks includes receiving performance reports for the Fund and risk management reports from Federated’s Chief Risk Officer at each regular Board meeting. The Chief Risk Officer is responsible for enterprise risk management at Federated, which includes risk management committees for investment management and for investor services. The Board also receives regular reports from the Fund’s Chief Compliance Officer regarding significant compliance risks.

On behalf of the Board, the Audit Committee plays a key role overseeing the Fund’s financial reporting and valuation risks. The Audit Committee meets regularly with the Fund’s Principal Financial Officer and outside auditors, as well as with Federated’s Chief Audit Executive to discuss financial reporting and audit issues, including risks relating to financial controls.

Board Ownership Of Shares In The Fund And In The Federated Family Of Investment Companies As Of December 31, 2010

Interested Board Member Name	Dollar Range of Shares Owned in Federated Intermediate Government Fund, Inc.	Aggregate Dollar Range of Shares Owned in Federated Family of Investment Companies
John F. Donahue	None	Over $100,000
J. Christopher Donahue	None	Over $100,000
Independent Board Member Name
Nicholas P. Constantakis	None	Over $100,000
John F. Cunningham	None	Over $100,000
Maureen Lally-Green		Over $100,000
Peter E. Madden	None	Over $100,000
Charles F. Mansfield, Jr.	None	Over $100,000
R. James Nicholson	None	Over $100,000
Thomas M. O’Neill	None	Over $100,000
John S. Walsh	None	Over $100,000
James F. Will	None	Over $100,000

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Investment Adviser

The Adviser conducts investment research and makes investment decisions for the Fund.

The Adviser is a wholly owned subsidiary of Federated.

The Adviser shall not be liable to the Fund or any Fund shareholder for any losses that may be sustained in the purchase, holding, or sale of any security or for anything done or omitted by it, except acts or omissions involving willful misfeasance, bad faith, gross negligence or reckless disregard of the duties imposed upon it by its contract with the Fund.

Portfolio Manager Information

The following information about the Fund’s portfolio manager is provided as of the end of the Fund’s most recently completed fiscal year.

Liam O’Connell, Portfolio Manager

Types of Accounts Managed by Liam O’Connell	Total Number of Additional Accounts Managed/Total Assets*	Additional Accounts/Assets Managed that are Subject to Advisory Fee Based on Account Performance
Registered Investment Companies	1/$962 Million
Other Pooled Investment Vehicles	0/$0
Other Accounts	3/$277 Million	1/$51 Million

* None of the Accounts has an advisory fee that is based on the performance of the account.

Dollar value range of shares owned in the Fund: None

Liam O’Connell is paid a fixed base salary and a variable annual incentive. Base salary is determined within a market competitive position-specific salary range, based on the portfolio manager’s experience and performance. The annual incentive amount is determined based primarily on Investment Product Performance (IPP) and, to a lesser extent, Financial Success, and may be paid entirely in cash, or in a combination of cash and restricted stock of Federated Investors, Inc. (“Federated”). The total combined annual incentive opportunity is intended to be competitive in the market for this portfolio manager role.

IPP is measured on a rolling one, three and five calendar year pre-tax gross total return basis vs. the Fund’s benchmark (i.e., Barclays Intermediate Government Index). Performance periods are adjusted if a portfolio manager has been managing an account for less than five years; accounts with less than one year of performance history under a portfolio manager may be excluded. As noted above, Mr. O’Connell is also the portfolio manager for other accounts in addition to the Fund. Such other accounts may have different benchmarks and performance measures. Within each performance measurement period, IPP is calculated with an equal weighting of each account managed by the portfolio manager. Additionally, a portion of Mr. O’Connell’s IPP score is based on the equally-weighted performance of portfolios for which he provides research and analytical support. In addition, Mr. O’Connell serves on one or more Investment Teams that establish guidelines on various performance drivers (e.g., currency, duration, sector, volatility and/or yield curve) for taxable, fixed-income funds. A portion of the IPP score is based on Federated’s senior management’s assessment of team contributions. A portion of the bonus tied to the IPP score may be adjusted based on management’s assessment of overall contributions to Fund performance and any other factors as deemed relevant.

The Financial Success category is designed to tie the portfolio manager’s bonus, in part, to Federated’s overall financial results. Funding for the Financial Success category may be determined on a product or asset class basis, as well as on corporate financial results. Senior Management determines individual Financial Success bonuses on a discretionary basis, considering overall contributions and any other factors deemed relevant.

In addition, Liam O’Connell was awarded a grant of restricted Federated stock. Awards of restricted stock are discretionary and are made in variable amounts based on the subjective judgment of Federated’s senior management.

As a general matter, certain conflicts of interest may arise in connection with a portfolio manager’s management of a fund’s investments, on the one hand, and the investments of other accounts for which the portfolio manager is responsible, on the other. For example, it is possible that the various accounts managed could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Fund. Alternatively, to the extent that the same investment opportunities might be desirable for more than one account, possible conflicts could arise in determining how to allocate them. Other potential conflicts might include conflicts created by specific portfolio manager compensation arrangements, and conflicts relating to selection of brokers or dealers to execute fund portfolio trades and/or specific uses of commissions from Fund portfolio trades (for example, research, or “soft dollars”). The Adviser has adopted policies and procedures and has structured the portfolio managers’ compensation in a manner reasonably designed to safeguard the Fund from being negatively affected as a result of any such potential conflicts.

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Services Agreement

Federated Advisory Services Company, an affiliate of the Adviser, provides certain support services to the Adviser. The fee for these services is paid by the Adviser and not by the Fund.

Other Related Services

Affiliates of the Adviser may, from time to time, provide certain electronic equipment and software to institutional customers in order to facilitate the purchase of Fund Shares offered by the Distributor.

Code Of Ethics Restrictions On Personal Trading

As required by SEC rules, the Fund, its Adviser and its Distributor have adopted codes of ethics. These codes govern securities trading activities of investment personnel, Fund Directors and certain other employees. Although they do permit these people to trade in securities, including those that the Fund could buy, as well as Shares of the Fund, they also contain significant safeguards designed to protect the Fund and its shareholders from abuses in this area, such as requirements to obtain prior approval for, and to report, particular transactions.

Voting Proxies On Fund Portfolio Securities

The Board has delegated to the Adviser authority to vote proxies on the securities held in the Fund’s portfolio. The Board has also approved the Adviser’s policies and procedures for voting the proxies, which are described below.

Proxy Voting Policies

The Adviser’s general policy is to cast proxy votes in favor of proposals that the Adviser anticipates will enhance the long-term value of the securities being voted. Generally, this will mean voting for proposals that the Adviser believes will: improve the management of a company; increase the rights or preferences of the voted securities; and/or increase the chance that a premium offer would be made for the company or for the voted securities.

The following examples illustrate how these general policies may apply to proposals submitted by a company’s board of directors. However, whether the Adviser supports or opposes a proposal will always depend on the specific circumstances described in the proxy statement and other available information.

On matters of corporate governance, generally the Adviser will vote for the full slate of directors nominated in an uncontested election; and for proposals to: require a company’s audit committee to be comprised entirely of independent directors; require independent tabulation of proxies and/or confidential voting by shareholders; reorganize in another jurisdiction (unless it would reduce the rights or preferences of the securities being voted); ratify the board’s selection of auditors (unless compensation for non-audit services exceeded 50% of the total compensation received from the company, or the previous auditor was dismissed because of a disagreement with the company); and repeal a shareholder rights plan (also known as a “poison pill”). The Adviser will generally vote against the adoption of such a plan (unless the plan is designed to facilitate, rather than prevent, unsolicited offers for the company).

On matters of capital structure, generally the Adviser will vote: against proposals to authorize or issue shares that are senior in priority or voting rights to the securities being voted; and for proposals to: reduce the amount of shares authorized for issuance; authorize a stock repurchase program; and grant preemptive rights to the securities being voted. The Adviser will generally vote against proposals to eliminate such preemptive rights.

On matters relating to management compensation, generally the Adviser will vote: for stock incentive plans that align the recipients’ interests with the interests of shareholders without creating undue dilution; against proposals that would permit the amendment or replacement of outstanding stock incentives with new stock incentives having more favorable terms; and against executive compensation plans that do not disclose the maximum amounts of compensation that may be awarded or the criteria for determining awards.

On matters relating to corporate transactions, the Adviser will vote proxies relating to proposed mergers, capital reorganizations and similar transactions in accordance with the general policy, based upon its analysis of the proposed transaction. The Adviser will vote proxies in contested elections of directors in accordance with the general policy, based upon its analysis of the opposing slates and their respective proposed business strategies. Some transactions may also involve proposed changes to the company’s corporate governance, capital structure or management compensation. The Adviser will vote on such changes based on its evaluation of the proposed transaction or contested election. In these circumstances, the Adviser may vote in a manner contrary to the general practice for similar proposals made outside the context of such a proposed transaction or change in the board. For example, if the Adviser decides to vote against a proposed transaction, it may vote for anti-takeover measures reasonably designed to prevent the transaction, even though the Adviser typically votes against such measures in other contexts.

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The Adviser generally votes against proposals submitted by shareholders without the favorable recommendation of a company’s board. The Adviser believes that a company’s board should manage its business and policies, and that shareholders who seek specific changes should strive to convince the board of their merits or seek direct representation on the board.

In addition, the Adviser will not vote if it determines that the consequences or costs outweigh the potential benefit of voting. For example, if a foreign market requires shareholders casting proxies to retain the voted shares until the meeting date (thereby rendering the shares “illiquid” for some period of time), the Adviser will not vote proxies for such shares.

Proxy Voting Procedures

The Adviser has established a Proxy Voting Committee (“Proxy Committee”), to exercise all voting discretion granted to the Adviser by the Board in accordance with the proxy voting policies. The Adviser has hired Glass Lewis & Co. (GL) to obtain, vote and record proxies in accordance with the Proxy Committee’s directions. The Proxy Committee has supplied GL with general voting instructions that represent decisions made by the Proxy Committee in order to vote common proxy proposals; however, the Proxy Committee retains the right to modify these voting instructions at any time or to vote contrary to the voting instructions at any time in order to cast proxy votes in a manner that the Proxy Committee believes is consistent with the Adviser’s general policy. GL may vote any proxy as directed in the voting instructions without further direction from the Proxy Committee and may make any determinations required to implement the voting instructions. However, if the voting instructions require case-by-case direction for a proposal, GL shall provide the Proxy Committee with all information that it has obtained regarding the proposal and the Proxy Committee will provide specific direction to GL.

Conflicts of Interest

The Adviser has adopted procedures to address situations where a matter on which a proxy is sought may present a potential conflict between the interests of the Fund (and its shareholders) and those of the Adviser or Distributor. This may occur where a significant business relationship exists between the Adviser (or its affiliates) and a company involved with a proxy vote. A company that is a proponent, opponent or the subject of a proxy vote, and which to the knowledge of the Proxy Committee has this type of significant business relationship, is referred to as an “Interested Company.”

The Adviser has implemented the following procedures in order to avoid concerns that the conflicting interests of the Adviser have influenced proxy votes. Any employee of the Adviser who is contacted by an Interested Company regarding proxies to be voted by the Adviser must refer the Interested Company to a member of the Proxy Committee, and must inform the Interested Company that the Proxy Committee has exclusive authority to determine how the Adviser will vote. Any Proxy Committee member contacted by an Interested Company must report it to the full Proxy Committee and provide a written summary of the communication. Under no circumstances will the Proxy Committee or any member of the Proxy Committee make a commitment to an Interested Company regarding the voting of proxies or disclose to an Interested Company how the Proxy Committee has directed such proxies to be voted. If the voting instructions already provide specific direction on the proposal in question, the Proxy Committee shall not alter or amend such directions. If the voting instructions require the Proxy Committee to provide further direction, the Proxy Committee shall do so in accordance with the proxy voting policies, without regard for the interests of the Adviser with respect to the Interested Company. If the Proxy Committee provides any direction as to the voting of proxies relating to a proposal affecting an Interested Company, it must disclose to the Fund’s Board information regarding: the significant business relationship; any material communication with the Interested Company; the matter(s) voted on; and how, and why, the Adviser voted as it did. Alternatively, the Proxy Committee may seek direction from the Fund’s Board on how a proposal concerning an Interested Company shall be voted, and shall follow any such direction provided by the Board. In seeking such direction, the Proxy Committee will disclose the reason such company is considered an Interested Company and may provide a recommendation on how such proposal should be voted and the basis for such recommendation.

If the Fund holds shares of another investment company for which the Adviser (or an affiliate) acts as an investment adviser, the Proxy Committee will vote the Fund’s proxies in the same proportion as the votes cast by shareholders who are not clients of the Adviser at any shareholders’ meeting called by such investment company, unless otherwise directed by the Board.

Proxy Voting Report

A report on “Form N-PX” of how the Fund voted any proxies during the most recent 12-month period ended June 30 is available through Federated’s website. Go to FederatedInvestors.com; from the home page, select “View All” next to “Find Products”; select the Fund name and share class, if applicable, to go to the Fund Overview page; on the Fund Overview page, select the “Documents” tab; at the bottom of that page, select “Proxy Voting Record Report (Form N-PX).” Form N-PX filings are also available at the SEC’s website at www.sec.gov.

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Portfolio Holdings Information

Information concerning the Fund’s portfolio holdings is available in the “Products” section of Federated’s website at FederatedInvestors.com. A complete listing of the Fund’s portfolio holdings as of the end of each calendar quarter is posted on the website 30 days (or the next business day) after the end of the quarter and remains posted for at least one year. Summary portfolio composition information as of the close of each month is posted on the website 15 days (or the next business day) after month-end and remains posted for at least one year. The summary portfolio composition information may include: percentage breakdowns of portfolio by type of security.

To access this information from the “Products” section of the website’s home page, select “View All” next to “Find Products.” Select the Fund name and share class, if applicable, to go to the Fund Overview page. On the Fund Overview page, select the “Portfolio Characteristics” tab for summary portfolio information or the “Documents” tab to access “Holdings.”

You may also access portfolio information as of the end of the Fund’s fiscal quarters from the “Documents” tab. The Fund’s Annual Shareholder Report and Semi-Annual Shareholder Report contain complete listings of the Fund’s portfolio holdings as of the end of the Fund’s second and fourth fiscal quarters. The Fund’s Form N-Q filings contain complete listings of the Fund’s portfolio holdings as of the end of the Fund’s first and third fiscal quarters. Fiscal quarter information is made available on the website within 70 days after the end of the fiscal quarter. This information is also available in reports filed with the SEC at the SEC’s website at www.sec.gov.

The disclosure policy of the Fund and the Adviser prohibits the disclosure of portfolio holdings information to any investor or intermediary before the same information is made available to other investors. Employees of the Adviser or its affiliates who have access to nonpublic information concerning the Fund’s portfolio holdings are prohibited from trading securities on the basis of this information. Such persons must report all personal securities trades and obtain pre-clearance for all personal securities trades other than mutual fund shares.

Firms that provide administrative, custody, financial, accounting, legal or other services to the Fund may receive nonpublic information about Fund portfolio holdings for purposes relating to their services. The Fund may also provide portfolio holdings information to publications that rate, rank or otherwise categorize investment companies. Traders or portfolio managers may provide “interest” lists to facilitate portfolio trading if the list reflects only that subset of the portfolio for which the trader or portfolio manager is seeking market interest. A list of service providers, publications and other third parties who may receive nonpublic portfolio holdings information appears in the Appendix to this SAI.

The furnishing of nonpublic portfolio holdings information to any third party (other than authorized governmental or regulatory personnel) requires the prior approval of the President of the Adviser and of the Chief Compliance Officer of the Fund. The President of the Adviser and the Chief Compliance Officer will approve the furnishing of nonpublic portfolio holdings information to a third party only if they consider the furnishing of such information to be in the best interests of the Fund and its shareholders. In that regard, and to address possible conflicts between the interests of Fund shareholders and those of the Adviser and its affiliates, the following procedures apply. No consideration may be received by the Fund, the Adviser, any affiliate of the Adviser or any of their employees in connection with the disclosure of portfolio holdings information. Before information is furnished, the third party must sign a written agreement that it will safeguard the confidentiality of the information, will use it only for the purposes for which it is furnished and will not use it in connection with the trading of any security. Persons approved to receive nonpublic portfolio holdings information will receive it as often as necessary for the purpose for which it is provided. Such information may be furnished as frequently as daily and often with no time lag between the date of the information and the date it is furnished. The Board receives and reviews annually a list of the persons who receive nonpublic portfolio holdings information and the purposes for which it is furnished.

Brokerage Transactions And Investment Allocation

When selecting brokers and dealers to handle the purchase and sale of portfolio instruments, the Adviser looks for prompt execution of the order at a favorable price. Fixed-income securities are generally traded in an over-the-counter market on a net basis (i.e., without commission) through dealers acting as principal or in transactions directly with the issuer. Dealers derive an undisclosed amount of compensation by offering securities at a higher price than they bid for them. Some fixed-income securities may have only one primary market maker. The Adviser seeks to use dealers it believes to be actively and effectively trading the security being purchased or sold, but may not always obtain the lowest purchase price or highest sale price with respect to a security. The Adviser makes decisions on portfolio transactions and selects brokers and dealers subject to review by the Fund’s Board.

Investment decisions for the Fund are made independently from those of other accounts managed by the Adviser and accounts managed by affiliates of the Adviser. When the Fund and one or more of those accounts invests in, or disposes of, the same security, available investments or opportunities for sales will be allocated among the Fund and the account(s) in a manner believed by the Adviser to be equitable. While the coordination and ability to participate in volume transactions may benefit the Fund, it is possible

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that this procedure could adversely impact the price paid or received and/or the position obtained or disposed of by the Fund. Investment decisions and trading for certain separately managed or wrap-fee accounts, and other accounts, of the Adviser and/or certain investment adviser affiliates of the Adviser are generally made and conducted independently from the Fund. It is possible that such independent trading activity could adversely impact the prices paid or received and/or positions obtained or disposed of by the Fund.

On February 28, 2011, the Federated Intermediate Government Fund, Inc. owned securities of the following regular broker/dealers:

Broker Dealer	Value of Securities Owned
Citigroup	$3,080,395

Administrator

Federated Administrative Services (FAS), a subsidiary of Federated, provides administrative personnel and services (including certain legal and financial reporting services) necessary to operate the Fund. FAS provides these at the following annual rates, based on the average aggregate daily net assets of the Fund and most of the other Federated funds:

Administrative Fee	Average Aggregate Daily Net Assets of the Federated Funds
0.150 of 1%	on the first $5 billion
0.125 of 1%	on the next $5 billion
0.100 of 1%	on the next $10 billion
0.075 of 1%	on assets over $20 billion

The administrative fee received during any fiscal year shall be at least $150,000 per portfolio and $40,000 per each additional class of Shares. FAS may voluntarily waive a portion of its fee and may reimburse the Fund for expenses.

FAS also provides certain accounting and recordkeeping services with respect to the Fund’s portfolio investments for a fee based on Fund assets plus out-of-pocket expenses.

Custodian

State Street Bank and Trust Company, Boston, Massachusetts, is custodian for the securities and cash of the Fund.

Transfer Agent And Dividend Disbursing Agent

State Street Bank and Trust Company, the Fund’s registered transfer agent, maintains all necessary shareholder records.

Independent Registered Public Accounting Firm

The independent registered public accounting firm for the Fund, Ernst & Young LLP, conducts its audits in accordance with the standards of the Public Company Accounting Oversight Board (United States), which require it to plan and perform its audits to provide reasonable assurance about whether the Fund’s financial statements and financial highlights are free of material misstatement.

Fees Paid by the Fund for Services

For the Year Ended February 28	2011	2010	2009
Advisory Fee Earned	$113,753	$118,643	$130,203
Advisory Fee Reduction	$112,464	$115,862	$122,805
Advisory Fee Reimbursement	$1,289	$2,781	$7,398
Administrative Fee	$155,285	$155,297	$155,326
12b-1 Fee:
Institutional Service Shares	$ —	$ —	$ —
Shareholder Services Fee:
Institutional Shares	$ —	$ —	$ —
Institutional Service Shares	$49,946	$ —	$ —

Fees are allocated among classes based on their pro rata share of Fund assets, except for marketing (“Rule 12b-1”) fees and shareholder services fees, which are borne only by the applicable class of Shares.

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How Does the Fund Measure Performance?

The Fund may advertise Share performance by using the SEC’s standard methods for calculating performance applicable to all mutual funds. The SEC also permits this standard performance information to be accompanied by non-standard performance information.

The performance of Shares depends upon such variables as: portfolio quality; average portfolio maturity; type and value of portfolio securities; changes in interest rates; changes or differences in the Fund’s or any class of Shares’ expenses; and various other factors.

Share performance fluctuates on a daily basis largely because net earnings and/or the value of portfolio holdings fluctuate daily. Both net earnings and offering price per Share are factors in the computation of yield and total return.

Average Annual Total Returns and Yield

Total returns are given for the one-year, five-year and ten-year periods ended February 28, 2011.

Yield is given for the 30-day period ended February 28, 2011.

	30-Day Period	1 Year	5 Years	10 Years
Institutional Shares:
Total Return
Before Taxes	N/A	3.26%	4.84%	3.94%
After Taxes on Distributions	N/A	2.61%	3.58%	2.67%
After Taxes on Distributions and Sale of Shares	N/A	2.12%	3.39%	2.60%
Yield	1.20%	N/A	N/A	N/A

	30-Day Period	1 Year	5 Years	10 Years
Institutional Service Shares:
Total Return
Before Taxes	N/A	3.05%	4.61%	3.70%
After Taxes on Distributions	N/A	2.48%	3.43%	2.52%
After Taxes on Distributions and Sale of Shares	N/A	1.98%	3.25%	2.45%
Yield	1.03%	N/A	N/A	N/A

Total Return

Total return represents the change (expressed as a percentage) in the value of Shares over a specific period of time, and includes the investment of income and capital gains distributions.

The average annual total return for Shares is the average compounded rate of return for a given period that would equate a $10,000 initial investment to the ending redeemable value of that investment. The ending redeemable value is computed by multiplying the number of Shares owned at the end of the period by the NAV per Share at the end of the period. The number of Shares owned at the end of the period is based on the number of Shares purchased at the beginning of the period with $10,000, less any applicable sales charge, adjusted over the period by any additional Shares, assuming the annual reinvestment of all dividends and distributions.

Total returns after taxes are calculated in a similar manner, but reflect additional standard assumptions required by the SEC.

Yield

The yield of Shares is calculated by dividing: (i) the net investment income per Share earned by the Shares over a 30-day period; by (ii) the maximum offering price per Share on the last day of the period. This number is then annualized using semi-annual compounding. This means that the amount of income generated during the 30-day period is assumed to be generated each month over a 12-month period and is reinvested every six months. The yield does not necessarily reflect income actually earned by Shares because of certain adjustments required by the SEC and, therefore, may not correlate to the dividends or other distributions paid to shareholders.

To the extent financial intermediaries charge fees in connection with services provided in conjunction with an investment in Shares, the Share performance is lower for shareholders paying those fees.

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Financial Information

The Financial Statements for the Fund for the fiscal year ended February 28, 2011, are incorporated herein by reference to the Annual Report to Shareholders of Federated Intermediate Government Fund, Inc. dated February 28, 2011.

Investment Ratings

STANDARD & POOR’S (S&P) LONG-TERM DEBT RATING DEFINITIONS

AAA – Highest credit quality. “AAA” ratings denote the lowest expectation of credit risk. They are assigned only in case of exceptionally strong capacity for timely payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.

AA – Very high credit quality. “AA” ratings denote a very low expectation of credit risk. They indicate very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.

A – High credit quality. “A” ratings denote a low expectation of credit risk. The capacity for timely payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to changes in circumstances or in economic conditions than is the case for higher ratings.

BBB – Good credit quality. “BBB” ratings indicate that there is currently a low expectation of credit risk. The capacity for timely payment of financial commitments is considered adequate, but adverse changes in circumstances and in economic conditions are more likely to impair this capacity. This is the lowest investment-grade category.

BB – Speculative. “BB” ratings indicate that there is a possibility of credit risk developing, particularly as the result of adverse economic change over time; however, business or financial alternatives may be available to allow financial commitments to be met. Securities rated in this category are not investment grade.

B – Highly speculative. “B” ratings indicate that significant credit risk is present, but a limited margin of safety remains. Financial commitments are currently being met; however, capacity for continued payment is contingent upon a sustained, favorable business and economic environment.

CCC, CC, C – High default risk. Default is a real possibility. Capacity for meeting financial commitments is solely reliant upon sustained, favorable business or economic developments. A “CC” rating indicates that default of some kind appears probable. “C” ratings signal imminent default.

D – In payment default. The “D” rating category is used when payments on a financial commitment are not made on the date due even if the applicable grace period has not expired, unless Standard & Poor’s believes that such payments will be made during such grace period. The “D” rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action if payments on a financial commitment are jeopardized.

MOODY’S INVESTORS SERVICE (MOODY’S) LONG-TERM DEBT RATINGS

Aaa – Bonds and preferred stock which are rated “Aaa” are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as “gilt edged.” Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues.

Aa – Bonds and preferred stock which are rated “Aa” are judged to be of high quality by all standards. Together with the “Aaa” group they comprise what are generally known as high-grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in “Aaa” securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risk appear somewhat larger than the “Aaa” securities.

A – Bonds and preferred stock which are rated “A” possess many favorable investment attributes and are to be considered as upper-medium-grade obligations. Factors giving security to principal and interest are considered adequate, but elements may be present which suggest a susceptibility to impairment some time in the future.

Baa – Bonds and preferred stock which are rated “Baa” are considered as medium-grade obligations (i.e., they are neither highly protected nor poorly secured). Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well.

Ba – Bonds and preferred stock which are rated “Ba” are judged to have speculative elements; their future cannot be considered as well-assured. Often the protection of interest and principal payments may be very moderate, and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this class.

B – Bonds and preferred stock which are rated “B” generally lack characteristics of the desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small.

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Caa – Bonds and preferred stock which are rated “Caa” are of poor standing. Such issues may be in default or there may be present elements of danger with respect to principal or interest.

Ca – Bonds and preferred stock which are rated “Ca” are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.

C – Bonds and preferred stock which are rated “C” are the lowest rated class of bonds and are typically in default, with little prospect for recovery of principal or interest.

NR – Indicates that both the bonds and the obligor or credit enhancer are not currently rated by S&P or Moody’s with respect to short-term indebtedness. However, management considers them to be of comparable quality to securities rated “A-1” or “P-1.”

NR(1) – The underlying issuer/obligor/guarantor has other outstanding debt rated “AAA” by S&P or “Aaa” by Moody’s.

NR(2) – The underlying issuer/obligor/guarantor has other outstanding debt rated “AA” by S&P or “Aa” by Moody’s.

NR(3) – The underlying issuer/obligor/guarantor has other outstanding debt rated “A” by S&P or Moody’s.

FITCH RATINGS LONG-TERM DEBT RATING DEFINITIONS

AAA – Highest credit quality. “AAA” ratings denote the lowest expectation of credit risk. They are assigned only in case of exceptionally strong capacity for timely payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.

AA – Very high credit quality. “AA” ratings denote a very low expectation of credit risk. They indicate very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.

A – High credit quality. “A” ratings denote a low expectation of credit risk. The capacity for timely payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to changes in circumstances or in economic conditions than is the case for higher ratings.

BBB – Good credit quality. “BBB” ratings indicate that there is currently a low expectation of credit risk. The capacity for timely payment of financial commitments is considered adequate, but adverse changes in circumstances and in economic conditions are more likely to impair this capacity. This is the lowest investment-grade category.

BB – Speculative. “BB” ratings indicate that there is a possibility of credit risk developing, particularly as the result of adverse economic change over time; however, business or financial alternatives may be available to allow financial commitments to be met. Securities rated in this category are not investment grade.

B – Highly speculative. “B” ratings indicate that significant credit risk is present, but a limited margin of safety remains. Financial commitments are currently being met; however, capacity for continued payment is contingent upon a sustained, favorable business and economic environment.

MOODY’S COMMERCIAL PAPER RATINGS

Prime-1 – Issuers rated “Prime-1” (or supporting institutions) have a superior ability for repayment of senior short-term debt obligations. “Prime-1” repayment ability will often be evidenced by many of the following characteristics: leading market positions in well established industries, high rates of return on funds employed, conservative capitalization structure with moderate reliance on debt and ample asset protection, broad margins in earning coverage of fixed financial charges and high internal cash generation, and well-established access to a range of financial markets and assured sources of alternate liquidity.

Prime-2 – Issuers rated “Prime-2” (or supporting institutions) have a strong ability for repayment of senior short-term debt obligations. This will normally be evidenced by many of the characteristics cited above, but to a lesser degree. Earnings trends and coverage ratios, while sound, will be more subject to variation. Capitalization characteristics, while still appropriate, may be more affected by external conditions. Ample alternate liquidity is maintained.

S&P COMMERCIAL PAPER RATINGS

A-1 – A short-term obligation rated “A-1” is rated in the highest category by Standard & Poor’s. The obligor’s capacity to meet its financial commitment on the obligation is strong. Within this category, certain obligations are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial commitment on these obligations is extremely strong.

A-2 – A short-term obligation rated “A-2” is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor’s capacity to meet its financial commitment on the obligation is satisfactory.

FITCH RATINGS COMMERCIAL PAPER RATING DEFINITIONS

F-1 – Indicates the strongest capacity for timely payment of financial commitments relative to other issuers or issues in the same country. Under their national rating scale, this rating is assigned to the “best” credit risk relative to all others in the same country and is normally assigned to all financial commitments issued or guaranteed by the sovereign state. Where the credit risk is particularly strong, a “+” is added to the assigned rating.

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F-2 – Indicates a satisfactory capacity for timely payment of financial commitments relative to other issuers or issues in the same country. However, the margin of safety is not as great as in the case of the higher ratings.

A.M. BEST LONG-TERM DEBT RATINGS

An A.M. Best Long-Term Debt Rating (issue credit rating) is an opinion as to the issuer’s ability to meet its financial obligations to security holders when due. These ratings are assigned to debt and preferred stock issues.

aaa – Exceptional. Assigned to issues where the issuer has, in A.M. Best’s opinion, an exceptional ability to meet the terms of the obligation.

aa – Very Strong. Assigned to issues where the issuer has, in A.M. Best’s opinion, a very strong ability to meet the terms of the obligation.

a – Strong. Assigned to issues where the issuer has, in A.M. Best’s opinion, a strong ability to meet the terms of the obligation.

bbb – Adequate. Assigned to issues where the issuer has, in A.M. Best’s opinion, an adequate ability to meet the terms of the obligation; however, is more susceptible to changes in economic or other conditions.

bb – Speculative. Assigned to issues where the issuer has, in A.M. Best’s opinion, speculative credit characteristics, generally due to a moderate margin of principal and interest payment protection and vulnerability to economic changes.

b – Very Speculative. Assigned to issues where the issuer has, in A.M. Best’s opinion, very speculative credit characteristics, generally due to a modest margin of principal and interest payment protection and extreme vulnerability to economic changes.

ccc, cc, c – Extremely Speculative. Assigned to issues where the issuer has, in A.M. Best’s opinion, extremely speculative credit characteristics, generally due to a minimal margin of principal and interest payment protection and/or limited ability to withstand adverse changes in economic or other conditions.

d – In Default. In default on payment of principal, interest or other terms and conditions. The rating also is utilized when a bankruptcy petition, or similar action, has been filed.

Ratings from “aa” to “ccc” may be enhanced with a “+” (plus) or “-” (minus) to indicate whether credit quality is near the top or bottom of a category. A company’s Long-Term Credit Rating also may be assigned an Under Review modifier (“u”) that generally is event-driven (positive, negative or developing) and indicates that the company’s A.M. Best Rating opinion is under review and may be subject to near-term change. Ratings prefixed with an (“i”) denote indicative ratings. Ratings may also be assigned a Public Data modifier (“pd”) which indicates that a company does not subscribe to A.M. Best’s interactive rating process.

A.M. BEST SHORT-TERM DEBT RATINGS

An A.M. Best Short-Term Debt Rating (issue credit rating) is an opinion as to the issuer’s ability to meet its obligations having maturities generally less than one year, such as commercial paper.

AMB-1+ – Strongest. Assigned to issues where the issuer has, in A.M. Best’s opinion, the strongest ability to repay short-term debt obligations.

AMB-1 – Outstanding. Assigned to issues where the issuer has, in A.M. Best’s opinion, an outstanding ability to repay short-term debt obligations.

AMB-2 – Satisfactory. Assigned to issues where the issuer has, in A.M. Best’s opinion, a satisfactory ability to repay short-term debt obligations.

AMB-3 – Adequate. Assigned to issues where the issuer has, in A.M. Best’s opinion, an adequate ability to repay short-term debt obligations; however, adverse economic conditions will likely lead to a reduced capacity to meet its financial commitments on short-term debt obligations.

AMB-4 – Speculative. Assigned to issues where the issuer has, in A.M. Best’s opinion, speculative credit characteristics and is vulnerable to economic or other external changes, which could have a marked impact on the company’s ability to meet its commitments on short-term debt obligations.

d – In Default. In default on payment of principal, interest or other terms and conditions. The rating also is utilized when a bankruptcy petition, or similar action, has been filed.

A company’s Short-Term Credit Rating also may be assigned an Under Review modifier (“u”) that generally is event-driven (positive, negative or developing) and indicates that the company’s A.M. Best Rating opinion is under review and may be subject to near-term change. Ratings prefixed with an (“i”) denote indicative ratings.

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A.M. BEST RATING OUTLOOK

A.M. Best Credit Ratings (“aaa” to “c”) are assigned a Rating Outlook that indicates the potential direction of a company’s rating for an intermediate period, generally defined as the next 12 to 36 months. Public Data Ratings are not assigned an Outlook. Ratings Outlooks are as follows:

Positive – Indicates a company’s financial/market trends are favorable, relative to its current rating level, and if continued, the company has a good possibility of having its rating upgraded.

Negative – Indicates a company is experiencing unfavorable financial/market trends, relative to its current rating level, and if continued, the company has a good possibility of having its rating downgraded.

Stable – Indicates a company is experiencing stable financial/market trends and that there is a low likelihood that its rating will change in the near term.

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Addresses

Federated Intermediate Government Fund, Inc.

Institutional Shares
Institutional Service Shares

Federated Investors Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561

Distributor

Federated Securities Corp.
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Investment Adviser

Federated Investment Management Company
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Custodian, Transfer Agent and Dividend Disbursing Agent

State Street Bank and Trust Company
P.O. Box 8600
Boston, MA 02266-8600

Independent Registered Public Accounting Firm

Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116-5072

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Appendix

The following is a list of persons, other than the Adviser and its affiliates, that have been approved to receive nonpublic portfolio holdings information concerning the Federated Fund Complex; however, certain persons below might not receive such information concerning the Fund:

CUSTODIAN(S)

State Street Bank and Trust Company

SECURITIES LENDING AGENT

Citibank, N.A.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Ernst & Young LLP

LEGAL COUNSEL

Dickstein Shapiro LLP
K&L Gates
Reed Smith LLP

SERVICE PROVIDERS

Abel Noser Corp.
Advent Software
Aegon Institutional Markets
Ashland Partners & Company LLP
Bank of America
Bank of New York Mellon
Barclay’s Capital Inc.
BBH (Brown Brothers Harriman) Infomediary
Bloomberg L.P.
Charles River
Citibank, NA
Computershare, Inc.
Eagle Investment Company
Edward Jones
FactSet
Fidelity
GE Life and Annuity Assurance Company
General Electric Capital Assurance Company
Glass Lewis & Co.
Global Trading Support Services
JPMorgan Chase & Co.
New York Life Insurance Company
OMGEO LLC
Options Clearing Corp. (OCC)
R.R. Donnelley
RiskMetrics
StatPro Group Plc
SunGard
The Travelers Insurance Company
Vintage Filings
Wells Fargo/Metropolitan West Securities LLC/MetWest Financials
Wilshire Associates, Inc.
XSP (Xcitek Solutions Plus)

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SECURITY PRICING SERVICES

Debt Domain
Interactive Pricing and Reference Data (Interactive Data Corporation)
Investment Technology Group
Markit Group Ltd.
Pricing Direct
Reuters LPC

RATINGS AGENCIES

Fitch, Inc.
Moody’s Investors Service
Standard & Poor’s
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Emerging Market Funds Research, Inc.
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OTHER

Chicago Mercantile Exchange
Investment Company Institute
Whitney Capital Group LLC

34

Item 28.  Exhibits

(a)
1	Conformed Copy of Articles of Incorporation of the Registrant	(3)
2	Conformed Copy of Amendment No. 1 to Articles of Incorporation of the Registrant	(3)
3	Conformed Copy of Amendment No. 2 to Articles of Incorporation of the Registrant	(6)
4	Conformed Copy of Amendment No. 3 to Articles of Incorporation of the Registrant	(8)
5	Conformed Copy of Amendment No. 4 and 5 to Articles of Incorporation of the Registrant	(9)
6	Conformed Copy of Amendment No. 6 to Articles of Incorporation of the Registrant	(14)

(b)
1	Copy of By-Laws of the Registrant	(3)
2	Copy of Amendment No. 1 to the By-Laws of the Registrant	(3)
3	Copy of Amendment No. 2, 3 and 4 to the By-Laws of the Registrant	(7)
4	Copy of Amendment No. 5 to the By-Laws of the Registrant	(11)
5	Copy of Amendment No. 6 to the By-Laws of the Registrant	(12)
6	Copy of Amendment No. 7 to the By-Laws of the Registrant	(13)
7	Copy of Amendment No. 8 to the By-Laws of the Registrant	(14)
8	Copy of Amendment No. 9 to the By-Laws of the Registrant	(14)

(c) Copy of Specimen Certificate of Shares of Beneficial Interest of the Registrant As of September 1, 1997, Federated Securities Corp. stopped issuing share certificates. (5)

(d)
1	Conformed copy of Investment Advisory Contract of the Registrant	(3)
2	Conformed copy of Amendment No. 1 to the Investment Advisory Contract of the Registrant	(9)
3	Conformed copy of Amendment to the Investment Advisory Contract of the Registrant	(10)

(e)
1	Conformed copy of Distributor’s Contract of the Registrant, including Exhibit A	(3)
2	Conformed copy of Exhibit B to the Distributor’s Contract of the Registrant	(9)
3	Conformed copy of Amendment to the Distributor’s Contract of the Registrant	(10)
4	The Registrant hereby incorporates the conformed copy of the specimen Mutual Funds Sales and Service Agreement; Mutual Funds Service Agreement; and Plan Trustee/Mutual Funds Service Agreement from Item 24(b)(6) of the Cash Trust Series II Registration Statement on Form N-1A, filed with the Commission on July 24, 1995.
5	Conformed copy of Amendment to Distributors Contract of the Registrant, dated October 1, 2003	(12)
6	Conformed copy of Amendment #1 to Exhibit A  of the Distributors Contract	(17)

(f) Not applicable

(g)
1	Conformed Copy of Custodian Agreement of the Registrant	(3)
2	Conformed Copy of Custodian Fee Schedule	(6)
3	Conformed Copy of Amendment to Custodian Agreement of the Registrant	(11)
4	Conformed Copy of Amendments 4 and 5 to Custodian Agreement of the Registrant	+

(h)
1	Conformed copy of Amended and Restated Agreement for Fund Accounting Services, Administrative Services, Shareholder Transfer Agency Services and Custody Services Procurement	(4)
2	Conformed copy of Amendment to the Amended and Restated Agreement for Fund Accounting Services, Administrative Services, Shareholder Transfer Agency Services and Custody Services Procurement	(10)
3	The Registrant hereby incorporates the conformed copy of the Second Amended and Restated Services Agreement, with attached Schedule 1 revised 6/30/04, from Item 23(h)(vii) of the Cash Trust Series,  Inc. Registration Statement on Form N-1A, filed with the Commission on July 29, 2004
4	The responses described in Item 23(e)(iv) are hereby incorporated by reference
5	The Registrant hereby incorporates the conformed copy of the Financial Administration and Accounting Services Agreement, with attached Exhibit A revised 3/1/06, from Item (h)(viii) of the Federated Total Return Government Bond Fund Registration Statement on Form N-1A, filed with the Commission on April 26, 2006
6	The Registrant hereby incorporates by reference the conformed copy of the Agreement for Administrative Services, with Exhibit 1 and Amendments 1 and 2 attached, between Federated Administrative Services and the Registrant from Item 23(h)(iv)of the Federated Total Return Series, Inc. Registration Statement on Form N-1A, filed with the Commission on November 29, 2004
7	The Registrant hereby incorporates the Conformed copy of the Transfer Agency and Service Agreement between the Federated Funds listed on Schedule A revised 3/1/06, from Item (h)(ix) of the Federated Total Return Government Bond Fund Registration Statement on Form N-1A, filed with the Commission on April 26, 2006
8	The Registrant hereby incorporates the Conformed copy of the Mutual Fund Expense/ Commission Recapture Services Agreement between State Street Global Markets, LLC and Certain Federated Funds with attached Exhibit 1 dated 3/1/06, from Item (h)(x) of the Federated Total Return Government Bond Fund Registration Statement on Form N-1A, filed with the Commission on April 26, 2006
9	Conformed copy of Financial Administration Accounting and Services Agreement, dated January 1, 2007	(15)
10	Conformed copy of Amendment to Transfer Agency and Service Agreement, dated January 1, 2008	(17)
11	Conformed copy of First Admendment to the Financial Administration and Accounting Services Agreement dated March 25, 2011	+

(i) Conformed copy of Opinion and Consent of Counsel as to legality of shares being registered (3)

(j)
1	Conformed copy of Consent of Independent Registered Public Accounting Firm	+

(k) Not Applicable

(l) Conformed copy of Initial Capital Understanding (3)

(m)
1	Conformed copy of Distribution Plan of the Registrant, including Exhibit A; (1)
2	The responses described in Item 23(e)(iv) are hereby incorporated by reference.
3	Conformed copy of Amendment #1 to Exhibit A to the Distribution Plan	(16)

(n)
1	The Registrant hereby incorporates the Copy of the Multiple Class Plan and attached Exhibits from Item (n) of the Federated Total Return Government Bond Fund Registration Statement on Form N-1A, filed with the Commission on April 26, 2006. (File Nos. 33-60411 and 811-07309)
2	Copies of Institutional Shares and Institutional Service Shares Exhibits to Multiple Class Plan	(17)
3	Copy of Multiple Class Plan and Institutional Service Shares Exhibits to Multiple Class Plan	+

(o)
1	Conformed copy of Power of Attorney of the Registrant	(9)
2	Conformed copy of Power of Attorney of the Chief Investment Officer of the Registrant	(9)
3	Conformed copy of Power of Attorney of President and Director, and Vice Chairman of the Registrant	(11)
4	Conformed copy of Power of Attorney of Treasurer of the Registrant	(14)
5	Conformed copy of Power of Attorney of Director, of the Registrant;	(14)
6	Conformed copy of Power of Attorney of Director of the Registrant	(14)
7	Conformed copy of Power of Attorney of Director of the Registrant	(15)
8	Conformed copy of Power of Attorney of Director, Maureen Lally-Green	(18)

(p)
1	Code of Ethics for Access Persons Effective 1/01/2005 (As Revised 1/26/2005 and 10/1/2008)	(17)
2	Code of Ethics for Access Persons revised 12/6/10	+

+ Exhibit is being filed electronically with registration statement; indicate by footnote

	ALL RESPONSES ARE INCORPORATED BY REFERENCE TO A POST-EFFECTIVE AMENDMENT (PEA) OF THE REGISTRANT FILED ON FORM N-1A (FILE NOS. 33-41004 and 811-6307)
1	Registrant's Post-Effective Registration Statement filed April 24, 1994.
3	PEA No. 8 filed April 21, 1995.
4	PEA No. 10 filed April 25, 1996.
5	PEA No. 12 filed April 28, 1997.
6	PEA No. 13 filed April 28, 1998.
7	PEA No. 14 filed February 26, 1999.
8	PEA No. 16 filed April 25, 2000.
9	PEA No. 17 filed April 25, 2001.
10	PEA No. 19 filed April 25, 2002.
11	PEA No. 20 filed April 29, 2003.
12	PEA No. 21 filed April 28, 2004.
13	PEA No. 22 filed April 29, 2005.
14	PEA No. 23 filed April 28, 2006.
15	PEA No. 24 filed April 27, 2007.
16	PEA No. 25 filed April 29, 2008.
17	PEA No. 26 filed April 28, 2009
18	PEA No. 27 filed April 27, 2010

Item 29  Persons Controlled by or Under Common Control with the Fund:

None

Item 30  Indemnification

(2)

Item 31  Business and Other Connections of Investment Adviser:
For a description of the other business of the Investment Adviser, see the section entitled “Who Manages the Fund?” in Part A. The affiliations with the Registrant of one of the Trustees and three of the Officers of the Investment Adviser are included in Part B of this Registration Statement under "Who Manages and Provides Services to the Fund?"  The remaining Trustees of the Investment Adviser and, in parentheses, their principal occupations are:  Thomas R. Donahue, (Chief Financial Officer, Federated Investors, Inc.), 1001 Liberty Avenue, Pittsburgh, PA, 15222-3779, [John B. Fisher, (Vice Chairman, Federated Investors, Inc.)] 1001 Liberty Avenue, Pittsburgh, PA, 15222-3779 and Mark D. Olson (a principal of the firm, Mark D. Olson & Company, L.L.C. and Partner, Wilson, Halbrook & Bayard, P.A.), 800 Delaware Avenue, P.O. Box 2305, Wilmington, DE  19899-2305.  The business address of each of the Officers of the Investment Adviser is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, Pennsylvania 15222-3779.  These individuals are also officers of a majority of the Investment Advisers to the investment companies in the Federated Fund Complex described in Part B of this Registration Statement.
The remaining Officers of the Investment Adviser are:
President/ Chief Executive Officer:	John B. Fisher
Executive Vice Presidents:	Deborah A. Cunningham Robert J. Ostrowski
Senior Vice Presidents:	Todd Abraham J. Scott Albrecht Joseph M. Balestrino Randall S. Bauer Jonathan C. Conley Mark E. Durbiano Donald T. Ellenberger Susan R. Hill Jeffrey A. Kozemchak Mary Jo Ochson Ihab Salib Paige Wilhelm
Vice Presidents:	G. Andrew Bonnewell Hanan Callas Jerome Conner James R. Crea, Jr. Karol Crummie Lee R. Cunningham, II B. Anthony Delserone, Jr. Bryan Dingle William Ehling Ann Ferentino Eamonn G. Folan John T. Gentry Kathryn P. Glass Patricia L. Heagy William R. Jamison Nathan H. Kehm John C. Kerber J. Andrew Kirschler Tracey Lusk Karen Manna Marian R. Marinack Natalie F. Metz Kari Mocharko Joseph M. Natoli Gene Neavin Bob Nolte Mary Kay Pavuk Jeffrey A. Petro John Polinski Rae Ann Rice Brian Ruffner Roberto Sanchez-Dahl, Sr. John Sidawi Michael W. Sirianni, Jr. Christopher Smith Kyle Stewart Mary Ellen Tesla Timothy G. Trebilcock Nicholas S. Tripodes Paolo H. Valle Stephen J. Wagner Mark Weiss George B. Wright
Assistant Vice Presidents:	Jason DeVito Timothy Gannon James Grant Ann Kruczek Christopher McGinley Ann Manley Keith Michaud Joseph Mycka Nick Navari Liam O’Connell Tom Scherr Chris Wu
Secretary:	G. Andrew Bonnewell
Treasurer:	Thomas R. Donahue
Assistant Treasurer:	Denis McAuley, III
Chief Compliance Officer	Brian P. Bouda

Item 32  Principal Underwriters:
(a)	Federated Securities Corp., the Distributor for shares of the Registrant, acts as principal underwriter for the following open-end investment companies, including the Registrant:
	Cash Trust Series, Inc.
	Cash Trust Series II
	Federated Adjustable Rate Securities Fund
	Federated Core Trust
	Federated Core Trust II, L.P.
	Federated Core Trust III
	Federated Equity Funds
	Federated Equity Income Fund, Inc.
	Federated Fixed Income Securities, Inc.
	Federated GNMA Trust
	Federated Government Income Securities, Inc.
	Federated High Income Bond Fund, Inc.
	Federated High Yield Trust
	Federated Income Securities Trust
	Federated Income Trust
	Federated Index Trust
	Federated Institutional Trust
	Federated Insurance Series
	Federated Intermediate Government Fund, Inc.
	Federated International Series, Inc.
	Federated Investment Series Funds, Inc.
	Federated Managed Allocation Portfolios
	Federated Managed Pool Series
	Federated MDT Series
	Federated Municipal Securities Fund, Inc.
	Federated Municipal Securities Income Trust
	Federated Premier Intermediate Municipal Income Fund
	Federated Premier Municipal Income Fund
	Federated Short-Intermediate Duration Municipal Trust
	Federated Asset Allocation Fund
	Federated MDT Stock Trust
	Federated Total Return Government Bond Fund
	Federated Total Return Series, Inc.
	Federated U.S. Government Bond Fund
	Federated U.S. Government Securities Fund: 1-3 Years
	Federated U.S. Government Securities Fund: 2-5 Years
	Federated World Investment Series, Inc.
	Intermediate Municipal Trust
	Edward Jones Money Market Fund
	Money Market Obligations Trust
(b)

(1) Positions and Offices with Distributor	(2) Name	(3) Positions and Offices With Registrant
Chairman:	Richard B. Fisher	Vice President
Executive Vice President, Assistant Secretary and Director:	Thomas R. Donahue
President and Director:	Thomas E. Territ
Vice President and Director:	Peter J. Germain
Treasurer and Director:	Denis McAuley III

(1) Positions and Offices with Distributor	(2) Name	(3) Positions and Offices With Registrant
Executive Vice Presidents:	Solon Person Paul Uhlman
Senior Vice Presidents:	Michael Bappert Richard W. Boyd Bryan Burke Charles L. Davis, Jr. Laura M. Deger Peter W. Eisenbrandt Theodore Fadool, Jr. Bruce E. Hastings James M. Heaton Harry J. Kennedy Michael Koenig Anne H. Kruczek Amy Michaliszyn Richard C. Mihm Becky Nelson Keith Nixon Brian S. Ronayne Tom Schinabeck John Staley Colin B. Starks Robert F. Tousignant William C. Tustin Michael Wolf

(1) Positions and Offices with Distributor	(2) Name	(3) Positions and Offices With Registrant
Vice Presidents:	Irving Anderson Marc Benacci Dan Berry Bill Boarts Edward R. Bozek Jane E. Broeren-Lambesis Edwin J. Brooks, III Mark Carroll Dan Casey Scott Charlton Steven R. Cohen James Conely Kevin J. Crenny G. Michael Cullen Beth C. Dell Jack C. Ebenreiter Donald C. Edwards Timothy Franklin Jamie Getz Scott Gundersen Dayna C. Haferkamp Raymond J. Hanley Vincent L. Harper, Jr. Scott A. Holick Robert Hurbanek Jeffrey S. Jones Todd Jones Scott D. Kavanaugh Patrick Kelly Matt Khan Ed Koontz Jerry L. Landrum David M. Larrick Christopher A. Layton Michael R. Manning Michael Marcin Diane Marzula Martin J. McCaffrey Mary A. McCaffrey Joseph McGinley Vincent T. Morrow John C. Mosko Doris T. Muller Alec H. Neilly Ted Noethling John A. O’Neill James E. Ostrowski Stephen Otto Mark Patsy Rich Paulson Chris Prado Sean Quirk Josh Rasmussen Richard A. Recker Diane M. Robinson Timothy A. Rosewicz Matt Ryan

(1) Positions and Offices with Distributor	(2) Name	(3) Positions and Offices With Registrant
Vice Presidents:	Eduardo G. Sanchez Robert E. Savarese, Jr. Leland T. Scholey Peter Siconolfi Edward L. Smith Peter Smith Jack L. Streich Mark Strubel Jonathen Sullivan Michael Vahl David Wasik G. Walter Whalen Stephen White Lewis Williams Littell L. Wilson Edward J. Wojnarowski Michael P. Wolff Daniel Wrable Erik Zettlemayer Paul Zuber

(1) Positions and Offices with Distributor	(2) Name	(3) Positions and Offices With Registrant
Assistant Vice Presidents:	Robert W. Bauman Mary Ellen Coyne Dino Giovannone Chris Jackson William Rose
Secretary:	C. Todd Gibson
Assistant Treasurer:	Lori A. Hensler Richard A. Novak
Chief Compliance Officer	Brian P.Bouda

(c) Not Applicable

Item 33  Location of Accounts and Records:

All accounts and records required to be maintained by Section 31(a) of the Investment Company Act of 1940 and Rules 31a-1 through 31a-3 promulgated thereunder are maintained at one of the following locations:

Registrant	Reed Smith LLP Investment Management Group (IMG) Reed Smith Centre 225 Fifth Avenue Pittsburgh, PA  15222 (Notices should be sent to the Agent for Service at above address) Federated Investors Funds 4000 Ericsson Drive Warrendale, PA  15086-7561
Federated Administrative Services (“Administrator”)	Federated Investors Tower 1001 Liberty Avenue Pittsburgh, PA  15222-3779
Federated Investment Management Company (“Adviser”)	Federated Investors Tower 1001 Liberty Avenue Pittsburgh, PA  15222-3779
State Street Bank and Trust Company (“Transfer Agent, Dividend Disbursing Agent” and “Custodian”)	P.O. Box 8600 Boston, MA  02266-8600

Item 34  Management Services:  Not applicable.

Item 35  Undertakings:

Registrant hereby undertakes to comply with the provisions of Section 16(c) of the 1940 Act with respect to the removal of Trustees and the calling of special shareholder meetings by shareholders.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, and the Investment Company Act of 1940, the Registrant, Federated Intermediate Government Fund, Inc., certifies that it meets all of the requirements for effectiveness of this Amendment to its Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused this Amendment to its Registration Statement to be signed on its behalf by the undersigned, duly authorized, in the City of Pittsburgh and Commonwealth of Pennsylvania, on the 27th day of April, 2011.

FEDERATED INTERMEDIATE GOVERNMENT FUND, INC.

BY:  /s/ Gail C. Jones

Gail C. Jones, Assistant Secretary

Pursuant to the requirements of the Securities Act of 1933, this Amendment to its Registration Statement has been signed below by the following person in the capacity and on the date indicated:

NAME	TITLE	DATE
BY:  /s/ Gail C. Jones Gail C. Jones, Assistant Secretary	Attorney In Fact For the Persons Listed Below	April 27th, 2011
John F. Donahue *	Trustee
J. Christopher Donahue *	President and Director (Principal Executive Officer)
Richard B. Fisher	Vice Chairman
Richard A. Novak*	Treasurer (Principal Financial Officer)
Nicholas P. Constantakis*	Director
John F. Cunningham*	Director
Maureen Lally-Green*	Director
Peter E. Madden*	Director
Charles F. Mansfield, Jr.*	Director
R. James Nicholson*	Director
Thomas O’Neill*	Director
John S. Walsh*	Director
James F. Will*	Director
*By Power of Attorney

EX-99.CUST

Exhibit 28 g(4) under Form N-1A

Exhibit 10 under Item 601/Reg. S-K

FOURTH AMENDMENT TO CUSTODIAN CONTRACT

THISAMENDMENT TO CUSTODIAN CONTRACT (the “Amendment”) is made and entered into as of March 1, 2011 by and among the investment companies listed on Exhibit I, as it may be amended from time to time (the “Trust”) on behalf of the portfolios (hereinafter collectively called the “Funds” and individually referred to as a “Fund”) of the Trust, Federated Services Company (the “Company”) and State Street Bank and Trust Company (the “Custodian”).

WITNESSETH:

WHEREAS, the Trust, the Company and the Custodian are parties to that certain Custodian Contract dated December 1, 1993 (the “Contract”), amended May 15, 2001, February 3, 2006 and July 3, 2007;

WHEREAS, each Trust is registered as a management investment company under the Investment Company Act of 1940, as amended; and

WHEREAS, the Trusts, the Company and the Custodian desire to amend the Contract subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:

1.Section 11 of the Contract is hereby deleted in its entirety and replaced with the following language:

11.           Effective Period, Termination and Amendment.

The Contract shall become effective on March 1, 2011 and shall remain in full force and effect for a period of four (4) years (the “Initial Term”) and shall automatically continue in full force and effect after such Initial Term until terminated as hereinafter provided, may be amended at any time by mutual agreement of the parties hereto and may be terminated by either party by an instrument in writing delivered or mail, postage prepaid to the other party, such termination to take effect not sooner than sixty (60) days after the date of such delivery or mailing; provided, however that the Custodian shall not act under Section 2.12 hereof in the absence of receipt of an initial certificate of the Secretary or an Assistant Secretary that the Board of the Trust has approved the initial use of a particular Securities System as required in each case by Rule 17f-4 under the 1940 Act; provided further, however, that the Trust shall not amend or terminate this Contract in contravention of any applicable federal or state regulations, or any provision of the Declaration of Trust/Articles of Incorporation, and further provided, that the Trust may at any time by action of its Board (i) substitute another bank or trust company for the Custodian by giving notice as described above to the Custodian, or (ii) immediately terminate this Contract in the event of the appointment of a conservator or receiver for the Custodian by the appropriate banking regulatory agency or upon the happening of a like event at the direction of an appropriate regulatory agency or court of competent jurisdiction.

Upon termination of the Contract, the Trust shall pay to the Custodian such compensation as may be due as of the date of such termination and shall likewise reimburse the Custodian for its costs, expenses and disbursements.

2.The following Sections 18 and 19 are hereby added to the Contract:

18.           Regulation GG.

The Trust hereby represents and warrants that it does not engage in an “Internet gambling business,” as such term is defined in Section 233.2(r) of Federal Reserve Regulation GG (12 CFR 233) (“Regulation GG”).  The Trust hereby covenants and agrees that it shall not engage in an Internet gambling business.  In accordance with Regulation GG, the Trust is hereby notified that “restricted transactions,” as such term is defined in Section 233.2(y) of Regulation GG, are prohibited in any dealings with the Custodian pursuant to this Contract or otherwise between or among any party hereto.

19.           Data Privacy.

The Custodian will implement and maintain a written information security program that contains appropriate security measures to safeguard the personal information of the Funds’ shareholders, employees, directors and/or officers that the Custodian receives, stores, maintains, processes or otherwise accesses in connection with the provision of services hereunder.  For these purposes, “personal information” shall mean (i) an individual’s name (first initial and last name or first name and last name), address or telephone number plus (a) social security number, (b) drivers license number, (c) state identification card number, (d) debit or credit card number, (e) financial account number or (f) personal identification number or password that would permit access to a person’s account or (ii) any combination of the foregoing that would allow a person to log onto or access an individual’s account.  Notwithstanding the foregoing “personal information” shall not include information that is lawfully obtained from publicly available information, or from federal, state or local government records lawfully made available to the general public.

3.The Contract is hereby ratified and confirmed and remains in full force and effect as amended by this Amendment.

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, this Amendment has been executed for and on behalf of the undersigned as of the date first written above.

On behalf of each of the Funds indicated on Exhibit I of the Custodian Contract, as amended from time to time

By:   /s/ Richard A. Novak

Name:  Richard A. Novak

Title:  Treasurer

FEDERATED SERVICES COMPANY

By: /s/ Denis McAuley

Name:  Denis McAuley

Title:

STATE STREET BANK AND TRUST COMPANY

By:   /s/ Michael F. Rogers

Name:  Michael F. Rogers

Title:    Executive Vice President

FIFTH AMENDMENT TO CUSTODIAN CONTRACT

THIS AMENDMENT TO CUSTODIAN CONTRACT (“Amendment”) is by and between the investment companies listed on Exhibit 1, as it may be amended from time to time (the “Trust”) on behalf of the portfolios (hereinafter collectively called the “Funds” and individually referred to as a “Fund”) of the Trust, Federated Services Company (the “Company”) and State Street Bank and Trust Company (the “Custodian”).

WITNESSETH:

WHEREAS, the Trust, the Company and the Custodian are parties to that certain Custodian Contract dated December 1, 1993 (the “Contract”), amended May 15, 2001, February 3, 2006, July 3, 2007, and March 1, 2011;

WHEREAS, each Trust is registered as a management investment company under the Investment Company Act of 1940, as amended;

WHEREAS, the Trusts, the Company and the Custodian desire to remove Funds from Exhibit 1, effective March 25, 2011; and

WHEREAS, the Trusts, the Company and the Custodian desire to amend the Contract subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:

4.   Exhibit 1 to the Contract is hereby deleted in its entirety and replaced with Exhibit 1 attached hereto.

5.   The Contract shall remain in full force and effect as amended by this Amendment.

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, this Amendment has been executed for and on behalf of the undersigned as March 25, 2011.

On behalf of each of the Funds indicated on Exhibit I of the Custodian Contract, as amended from time to time

By:   /s/ Richard A. Novak

Name:  Richard A. Novak

Title:  Treasurer

FEDERATED SERVICES COMPANY

By: /s/ Denis McAuley

Name:  Denis McAuley

Title:

STATE STREET BANK AND TRUST COMPANY

By:   /s/ Michael F. Rogers

Name:  Michael F. Rogers

Title:    Executive Vice President

EXHIBIT 1

TO CUSTODIAN CONTRACT BETWEEN FEDERATED INVESTMENT COMPANIES,

STATE STREET BANK AND TRUST COMPANY, AND FEDERATED SERVICES COMPANY

Dated December 1, 1993

(Exhibit 1 revised as of 3/25/11)

Federated Intermediate Government Fund, Inc.

EX-99.FAAS

Exhibit 28 h (11) under Form N-1A

Exhibit 10 under Item 601/Reg. S-K

FIRST AMENDMENT TO

FINANCIAL ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT

THIS FIRST AMENDMENT TO FINANCIAL ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT (“Amendment”) is by and between each of the investment companies listed on Exhibit A to the Agreement, as defined below (each, a “Trust”), and State Street Bank and Trust Company (“State Street”).

W I T N E S S E T H:

WHEREAS, the Trusts and State Street are parties to that certain Financial Administration and Accounting Services Agreement (the “Agreement”) dated March 1, 2011;

WHEREAS, each Trust is registered as a management investment company under the Investment Company Act of 1940, as amended; and

WHEREAS, the Trusts and State Street desire to amend the Agreement subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:

1.   Exhibit A to the Agreement is hereby amended and updated to delete the following Funds, effective March 25, 2011:

·   Federated Municipal Ultrashort Fund, a portfolio of Federated Fixed Income Securities, Inc.

·   Federated Premier Municipal Income Fund

·   Federated Premier Intermediate Municipal Income Fund

·   Federated Short-Intermediate Duration Municipal Trust,

·   Federated Muni and Stock Advantage Fund, a portfolio of Federated Income Securities Trust

·   Federated International Bond Fund, a portfolio of Federated International Series, Inc.

·   Federated International Bond Strategy Portfolio, a portfolio of Federated Managed Pool Series

·   Federated Emerging Market Debt Fund, a portfolio of Federated World Investment Series, Inc.

·   Federated Prudent DollarBear Fund, a portfolio of Federated Income Securities Trust

·   Federated InterContinental Fund, a portfolio of Federated Equity Funds

·   Federated International Leaders Fund, a portfolio of Federated World Investment Series, Inc.

·   Federated International Small-Mid Company Fund, a portfolio of Federated World Investment Series, Inc.

·   Federated International Strategic Value Dividend Fund, a portfolio of Federated Equity Funds

2.   The Agreement is hereby further amended and updated to delete Sections III. A. 9, 10 and 11 and Section III. B. 1. d., effective March 25, 2011.

3.   The Agreement shall remain in full force and effect as amended by this Amendment.

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, this Amendment has been executed for and on behalf of the undersigned as of March 25, 2011.

On behalf of each of the Funds indicated on Exhibit A of the Financial Administration and Accounting Services Agreement, as amended from time to time

By: /s/ Richard A. Novak

Title:  Treasurer

STATE STREET BANK AND TRUST COMPANY

By:  /s/ Michael F. Rogers

Title:  Executive Vice President

EX-99.MCP

Exhibit 28 n (3) under Form N-1A

Exhibit 99 under Item 601/Reg. S-K

MULTIPLE CLASS PLAN

This Multiple Class Plan (this "Plan") is adopted by the investment companies (the "Multiple Class Companies") identified in exhibits hereto (the "Class Exhibits") as offering separate classes of shares ("Classes").

1.           Purpose

This Plan is adopted pursuant to Rule 18f-3 under the Investment Company Act of 1940, as amended (the "Rule"), in connection with the issuance by the Multiple Class Companies and any series thereof (collectively the "Funds") of more than one Class of shares in reliance on the Rule.  In documenting the exchange features for each Class, this plan describes the arrangements whereby shares of Funds may be exchanged for or from certain other investment companies which are not part of this Plan.  In documenting the separate arrangement for distribution of each Class, this Plan also sets forth the schedules for variations in sales loads and contingent deferred sales charges required by Rules 22d-1 and 6c-10, respectively.

2.          Separate Arrangements/Class Differences

The arrangements for shareholders services or the distribution of shares, or both, for each Class shall be set forth in the applicable Class Exhibit hereto.

3.           Expense Allocations

Each Class shall be allocated those shareholder service fees and fees and expenses payable under a Rule 12b-1 Plan specified in the Class Exhibit.  In addition the following expenses may be specifically allocated to each Class to the extent that the Fund's officers determine that such expenses are actually incurred in a different amount by that Class, or that the Class receives services of a different kind or to a different degree than other Classes:

(a)           transfer agent fees;

(b) printing and postage expenses related to preparing and distributing materials such as shareholder reports, prospectuses, and proxies to current shareholders;

(c) blue sky registration fees;

(d) SEC registration fees;

(e) the expense of administrative personnel and services as required to support the shareholders;

(f) litigation or other legal expenses relating solely to one Class; or

(g) other expenses incurred on behalf of the Class or for events or activities pertaining exclusively to the Class.

4.           Conversion and Exchange Features

The conversion and exchange features for shares of each Class shall be as set forth in the applicable Class Exhibit hereto.

5.           Amendment

Any material amendment of this Plan or any Class Exhibit hereto by any Multiple Class Company is subject to the approval of a majority of the directors/trustees of the applicable Multiple Class Company and a majority of the directors/trustees of the Multiple Class Company who are not interested persons of the Multiple Class Company, pursuant to the Rule.

INSTITUTIONAL SHARES EXHIBIT

TO

MULTIPLE CLASS PLAN

(REVISED 1/31/11)

1.           SEPARATE ARRANGEMENT AND EXPENSE ALLOCATION

For purposes of Rule 18f-3 under the Act, the basic distribution and shareholder servicing arrangement of the Institutional Shares will consist of

(i)	with respect to money market funds, sales and shareholder servicing by financial intermediaries; and
(ii)	with respect to fluctuating NAV funds, sales and shareholder servicing by financial intermediaries to the following categories of investors (“Eligible Investors”);

· An investor participating in a wrap program or other fee-based program sponsored by a financial intermediary;

· An investor participating in a no-load network or platform sponsored by a financial intermediary where Federated has entered into an agreement with the intermediary;

· A trustee/director, employee or former employee of the Fund, the Adviser, the Distributor and their affiliates; an immediate family member of these individuals, or a trust, pension or profit-sharing plan for these individuals;

· An employer-sponsored retirement plan;

· A trust institution investing on behalf of its trust customers;

· An investor, other than a natural person, purchasing Shares directly from the Fund;

· An investor (including a natural person) who owned Shares as of December 31, 2008;

· Without regard to the initial investment minimum, an investor who acquired Institutional Shares pursuant to the terms of an agreement and plan of reorganization which permits the investor to acquire such Shares; and

· Without regard to the initial investment minimum, in connection with an acquisition of an investment management or advisory business, or related investment services, products or assets, by Federated or its investment advisory subsidiaries, an investor (including a natural person) who (1) becomes a client of an investment advisory subsidiary of Federated or (2) is a shareholder or interest holder of a pooled investment vehicle or product that becomes advised or subadvised by a Federated investment advisory subsidiary as a result of such an acquisition other than as a result of a fund reorganization transaction pursuant to an agreement and plan of reorganization.

The principal underwriter and financial intermediaries may receive payments for distribution and/or administrative services under a Rule 12b-1 Plan and financial intermediaries may also receive shareholder service fees for services provided.  In connection with this basic arrangement, Institutional Shares will bear the following fees and expenses:

Fees and Expenses	Maximum Amount Allocated Institutional Shares
Sales Load	None
Contingent Deferred Sales Charge ("CDSC")	None
Shareholder Service Fee	As set forth in the attached Schedule
12b-1 Fee	As set forth in the attached Schedule
Other Expenses	Itemized expenses incurred by the Fund with respect to holders of Institutional Shares as described in Section 3 of the Plan

2.           CONVERSION AND EXCHANGE PRIVILEGES

For purposes of Rule 18f-3, Institutional Shares have the following conversion rights and exchange privileges at the election of the shareholder:

Conversion Rights:	None
Exchange Privilege:	Institutional Shares may be exchanged for Institutional Shares of any other Federated fund or share class that does not have a stated sales charge or contingent deferred sales charge, except Class A Shares of Federated Liberty U.S. Government Money Market Trust and Class R Shares.

In any exchange, the shareholder shall receive shares having the same aggregate net asset value as the shares surrendered, unless Class A Shares or Class F Shares which are subject to a CDSC are being exchanged, in which case the CDSC fee will be imposed as if the Class A Shares or Class F Shares had been redeemed.  Exchanges to any other Class shall be treated in the same manner as a redemption and purchase.

SCHEDULE OF FUNDS

OFFERING INSTITUTIONAL SHARES

The Funds set forth on this Schedule each offer Institutional Shares on the terms set forth in the Institutional Shares Exhibit to the Multiple Class Plan, in each case as indicated below.  The 12b-1 fees indicated are the maximum amounts authorized based on the average daily net asset value.  Actual amounts accrued may be less.

Multiple Class Company Series	12b-1 Fee	Shareholder Service Fee
Federated Adjustable Rate Securities Fund	None	0.25%
Federated Asset Allocation Fund (formerly Federated Stock and Bond Fund)	None	None
Federated Equity Funds:
Federated Capital Appreciation Fund	None	None
Federated Clover Small Value Fund	None	None
Federated Clover Value Fund	None	None
Federated Global Equity Fund	None	None
Federated InterContinental Fund	None	None
Federated International Strategic Value Dividend Fund	None	None
Federated Kaufmann Large Cap Fund	None	None
Federated Market Opportunity Fund	None	None
Federated Mid Cap Growth Strategies Fund	None	None
Federated Prudent Bear Fund	None	None
Federated Strategic Value Dividend Fund	None	None
Federated Fixed Income Securities, Inc.:
Federated Municipal Ultrashort Fund	None	None
Federated Strategic Income Fund	None	None
Federated GNMA Trust	None	0.25%
Federated Income Securities Trust:
Federated Floating Rate Strategic Income Fund	None	None
Federated Unconstrained Bond Fund	None	None
Federated Intermediate Corporate Bond Fund	None	0.25%
Federated Muni and Stock Advantage Fund	None	None
Federated Prudent DollarBear Fund	None	None
Federated Real Return Bond Fund	None	0.25%
Federated Short-Term Income Fund	None	0.25%
Federated Income Trust	None	0.25%

Multiple Class Company Series	12b-1 Fee	Shareholder Service Fee
Federated Index Trust:
Federated Max-Cap Index Fund	None	0.25%
Federated Institutional Trust:
Federated Government Ultrashort DurationFund	None	None
Federated Intermediate Government/Corporate Fund	None	None
Federated Intermediate Government Fund, Inc.	None	None
Federated Investment Series Fund, Inc.
Federated Bond Fund	None	None
Federated MDT Series:
Federated MDT All Cap Core Fund	None	None
Federated MDT Balanced Fund	None	None
Federated MDT Large Cap Growth Fund	None	None
Federated MDT Small Cap Core Fund	None	None
Federated MDT Small Cap Growth Fund	None	None
Federated MDT Stock Trust	None	None
Federated Short-Intermediate Duration Municipal Trust	None	0.25%
Federated Total Return Government Bond Fund	None	None
Federated Total Return Series, Inc.:
Federated Mortgage Fund	None	0.25%
Federated Total Return Bond Fund	None	None
Federated Ultrashort Bond Fund	None	0.25%
Federated U.S. Government Securities Fund:  1-3 Years	None	0.25%
Federated U.S. Government Securities Fund:  2-5 Years	None	0.25%
Federated World Investment Series, Inc.
Federated International Leaders Fund	None	None
Federated International Small-Mid Company Fund	None	None
Intermediate Municipal Trust:
Federated Intermediate Municipal Trust	None	0.25%

Multiple Class Company Series	12b-1 Fee	Shareholder Service Fee
Money Market Obligations Trust:
Federated California Municipal Cash Trust	None	0.25%
Federated Florida Municipal Cash Trust	0.25%	0.25%
Federated Government Obligations Fund	None	0.25%
Federated Government Obligations Tax-Managed Fund	None	0.25%
Federated Michigan Municipal Cash Trust	None	0.25%
Federated Minnesota Municipal Cash Trust	None	0.25%
Federated Municipal Obligations Fund	None	0.25%
Federated New Jersey Municipal Cash Trust	None	0.25%
Federated New York Municipal Cash Trust	None	0.25%
Federated Ohio Municipal Cash Trust	None	0.25%
Federated Pennsylvania Municipal Cash Trust	None	0.25%
Federated Prime Cash Obligations Fund	None	0.25%
Federated Prime Management Obligations Fund	None	0.25%
Federated Prime Obligations Fund	None	0.25%
Federated Prime Value Obligations Fund	None	0.25%
Federated Tax-Free Obligations Fund	None	0.25%
Federated Treasury Obligations Fund	None	0.25%
Federated U.S. Treasury Cash Reserves	None	0.25%
Federated Virginia Municipal Cash Trust	None	0.25%

-  -

INSTITUTIONAL SERVICE SHARES EXHIBIT

TO

MULTIPLE CLASS PLAN

(REVISED 12/31/10)

1.           SEPARATE ARRANGEMENT AND EXPENSE ALLOCATION

For purposes of Rule 18f-3 under the Act, the basic distribution and shareholder servicing arrangement of the Institutional Shares will consist of

(i)	with respect to money market funds, sales and shareholder servicing by financial intermediaries; and
(ii)	with respect to fluctuating NAV funds, sales and shareholder servicing by financial intermediaries to the following categories of investors (“Eligible Investors”);

· An investor participating in a wrap program or other fee-based program sponsored by a financial intermediary;

· An investor participating in a no-load network or platform sponsored by a financial intermediary where Federated has entered into an agreement with the intermediary;

· A trustee/director, employee or former employee of the Fund, the Adviser, the Distributor and their affiliates; an immediate family member of these individuals, or a trust, pension or profit-sharing plan for these individuals;

· An employer-sponsored retirement plan;

· A trust institution investing on behalf of its trust customers;

· An investor, other than a natural person, purchasing Shares directly from the Fund;

· An investor (including a natural person) who owned Shares as of December 31, 2008;

· Without regard to the initial investment minimum, an investor who acquired Institutional Service Shares pursuant to the terms of an agreement and plan of reorganization which permits the investor to acquire such Shares; and

· Without regard to the initial investment minimum, in connection with an acquisition of an investment management or advisory business, or related investment services, products or assets, by Federated or its investment advisory subsidiaries, an investor (including a natural person) who (1) becomes a client of an investment advisory subsidiary of Federated or (2) is a shareholder or interest holder of a pooled investment vehicle or product that becomes advised or subadvised by a Federated investment advisory subsidiary as a result of such an acquisition other than as a result of a fund reorganization transaction pursuant to an agreement and plan of reorganization.

The principal underwriter and financial intermediaries may receive payments for distribution and/or administrative services under a Rule 12b-1 Plan and financial intermediaries may also receive shareholder service fees for services provided.  In connection with this basic arrangement, Institutional Service Shares will bear the following fees and expenses:

Fees and Expenses	Maximum Amount Allocated Institutional Service Shares
Sales Load	None
Contingent Deferred Sales Charge ("CDSC")	None
Shareholder Service Fee	Up to 25 basis points (0.25%) of the average daily net asset value
12b-1 Fee	As set forth in the attached Schedule
Other Expenses	Itemized expenses incurred by the Fund with respect to holders of Institutional Service Shares as described in Section 3 of the Plan

1.   2.Conversion and Exchange Privileges

For purposes of Rule 18f-3, Institutional Service Shares have the following conversion rights and exchange privileges at the election of the shareholder:

Conversion Rights:

None

Exchange Privileges:

Institutional Service Shares may be exchanged for Institutional Service Shares of any other Federated fund or share class that does not have a stated sales charge or contingent deferred sales charge, except Class A Shares of FederatedLiberty U.S. Government Money Market Trust and Class R Shares.  Institutional Service Shares may also be exchanged for shares of Investment Companies that are not subject to this Plan, as provided in the "Proprietary Fund Schedule" attached hereto.

In any exchange, the shareholder shall receive shares having the same aggregate net asset value as the shares surrendered, unless Class A Shares or Class F Shares which are subject to a CDSC are being exchanged, in which case the CDSC fee will be imposed as if the Class A Shares or Class F Shares had been redeemed.  Exchanges to any other Class shall be treated in the same manner as a redemption and purchase.

SCHEDULE OF FUNDS

OFFERING INSTITUTIONAL SERVICE SHARES

The Funds set forth on this Schedule each offer Institutional Service Shares on the terms set forth in the Institutional Service Shares Exhibit to the Multiple Class Plan, in each case as indicated below.  The 12b-1 fees indicated are the maximum amounts authorized based on the average daily net asset value.  Actual amounts accrued may be less.

Multiple Class Company Series	12b-1 Fee
Federated Adjustable Rate Securities Fund	0.25%
Federated GNMA Trust	0.05%
Federated Income Securities Trust:
Federated Intermediate Corporate Bond Fund	0.25%
Federated Short-Term Income Fund	0.15%
Federated Income Trust	0.05%
Federated Index Trust	0.30%
Federated Max-Cap Index Fund
Federated Institutional Trust:
Federated Government Ultrashort Duration Fund	0.05%
Federated Intermediate Government/Corporate Fund	0.05%
Federated Intermediate Government Fund, Inc.	0.25%
Federated MDT Stock Trust	None
Federated Short-Intermediate Duration Municipal Trust	0.25%
Federated Total Return Government Bond Fund	0.25%
Federated Total Return Series, Inc.:
Federated Mortgage Fund	0.25%
Federated Total Return Bond Fund	0.25%
Federated Ultrashort Bond Fund	0.25%
Federated U.S. Government Securities Fund:  1-3 Years	0.25%
Federated U.S. Government Securities Fund:  2-5 Years	0.05%

Multiple Class Company Series	12b-1 Fee
Money Market Obligations Trust:
Federated Automated Cash Management Trust	None
Federated California Municipal Cash Trust	None
Federated Connecticut Municipal Cash Trust	None
Federated Government Obligations Fund	None
Federated Government Obligations Tax-Managed Fund	None
Federated Massachusetts Municipal Cash Trust	None
Federated Michigan Municipal Cash Trust	None
Federated Municipal Obligations Fund	None
Federated New Jersey Municipal Cash Trust	0.10%
Federated New York Municipal Cash Trust	0.25%
Federated Ohio Municipal Cash Trust	None
Federated Pennsylvania Municipal Cash Trust	None
Federated Prime Cash Obligations Fund	None
Federated Prime Management Obligations Fund	None
Federated Prime Obligations Fund	None
Federated Prime Value Obligations Fund	None
Federated Tax-Free Obligations Fund	None
Federated Treasury Obligations Fund	0.25%
Federated U.S. Treasury Cash Reserves	None
Federated Virginia Municipal Cash Trust	None
Tax-Free Money Market Fund	None

PROPRIETARY FUND SCHEDULE -

INSTITUTIONAL SERVICE SHARES

Shares issued by investment companies that are not party to this Plan but that are listed on this Proprietary Fund Schedule ("Non-Plan Investment Companies") may be exchanged for Institutional Service Shares of the Funds indicated opposite their names.  Such Institutional Service Shares may also be exchanged back into shares of the original Non-Plan Investment Company.  In addition, indicated Institutional Service Shares purchased from a dealer party to a Dealer Agreement to sell the indicated Non-Plan Investment Company Shares may be exchanged for Shares of such Non-Plan Investment Company.  In any exchange, the shareholder shall receive shares having the same aggregate net asset value as the shares surrendered.  Exchanges into any class of shares of a Non-Plan Investment Company not shown on this schedule shall be treated in the same manner as a redemption and purchase.

Multiple Class Series/Company	Non-Plan Investment Companies
Money Market Obligations Trust - Federated Automated Cash Management Trust	WesMark Funds

EX-99.COE

Exhibit 28 (p) (2) under Form N-1A

Exhibit 99 under Item 601/Reg. S-K

Federated Investors, Inc.

Code of Ethics for Access Persons

Effective 12/06/2010

Table of Contents

		Page
INTRODUCTION		1
1	RESPONSIBILITIES	2
1.1	GeneralPrinciples	2
1.2	Compliance with this Code is a condition of employment	3
1.3	Personal Responsibility	3
1.4	Perceived ambiguity shall not excuse violations	4
1.5	Preclearance does not protect wrongdoing	4
2	REPORTING REQUIREMENTS	4
2.1	Initial Reporting Requirements	4
2.2	Quarterly Reporting Requirements	5
2.3	Annual Reporting Requirements	6
2.4	Independent Directors	6
2.5	Non-Federated Officers of Federated Funds or Proprietary Client Funds	7
2.6	Access Persons Acknowledgments of Receipt of Code of Ethics and Amendments	8
3	PRECLEARANCE REQUIREMENTS	8
3.1	Preclearance of Trades	8
3.2	Duration and Revocation	9
3.3	Preclearance Does Not Protect Wrongdoing	9
3.4	Exceptions	9
3.5	Exception for Employee Stock Options of a Previous Employer	10
3.6	Federated Stock and Options Trading	11
3.7	Special Rules for Equity Transactions Based on Market Capitalization	11
4	EXEMPT TRANSACTIONS	11
4.1	Exempt Securities	11
4.2	Discretionary Accounts	12
5	PROHIBITIONS AND RESTRICTIONS	12
5.1	General Prohibitions	12
5.2	Equity Initial Public Offerings (IPOs) are Prohibited	14
5.3	Private Placements Require Prior Compliance Approval	14
5.4	Prohibition of Short-Term Profits – 60-Day Rule – Individual Securities	15
5.5	Minimum Holding Period – Designated Federated Funds	15
5.6	Prohibition on Insider Trading	16
5.7	Disclosure or Misuse of Fund Information	16
5.8	Blackout Periods - Fund Trades	16
5.9	Prior Knowledge	17
5.10	Serving as a Director or Officer of Outside Organizations	17
5.11	Excessive Trading and Market Timing	19
5.12	Independent Directors	20
5.13	Restrictions on Investment Clubs	20
5.14	Disclosure of Personal Interests	20
6	PROHIBITIONS ON GIVING/RECEIVING GIFTS; POLITICAL AND CHARITABLE CONTRIBUTIONS	21
7	REVIEW, REPORTING, EDUCATION AND SANCTIONS	22
7.1	Management Review of Investment Personnel’ s Trading Activity	22
7.2	Compliance Review of Reports and Trading Activity, and this Code of Ethics	23
7.3	Self-discovery and Reporting	23
7.4	Education	24
7.5	Sanctions	24
7.6	Factors For Consideration	24
7.7	Reporting of Violations	25
8	DEFINITIONS	25
8.1	1933 Act	25
8.2	1934 Act	25
8.3	1940 Act	25
8.4	Access Person	25
8.5	Adviser	26
8.6	Advisers Act	26
8.7	Associated Procedures	26
8.8	Automatic Investment Plan	26
8.9	Beneficial Ownership	26
8.10	Board	26
8.11	Code	27
8.12	Compliance Committee	27
8.13	Compliance Department	27
8.14	Control	27
8.15	Covered Security	27
8.16	Federal Securities Laws	27
8.17	Federated	28
8.18	Fund	28
8.19	Independent Director	28
8.20	Influence	28
8.21	Initial Public Offering	28
8.22	Investment Person; Investment Personnel	28
8.23	Private Placement	29
8.24	Purchase or Sale	29
8.25	Reportable Fund	29
8.26	SEC	29
8.27	Security	29
8.28	Supervised Person	29
8.29	Underwriter	29
8.30	Vendor	30

ADDENDUM

Access Persons Procedures	A-1
Compliance Department Procedures	B-1

CODE OF ETHICS FOR ACCESS PERSONS

Introduction

This Code sets forth standards of conduct and professionalism that apply to all persons designated as Access Persons by the Compliance Department.  This Code was designed and established, and will be maintained and enforced, to protect Federated’s clients (or Funds) by deterring misconduct and to guard against violations of the Federal Securities Laws.  This Code reinforces the value that Federated places on ethical conduct.  Each Access Person must comply with this Code and uphold Federated’s ethical standards at all times.  Each Access Person also is responsible for ensuring that spouses, children and others residing in the same household do not violate applicable provisions of this Code.

It is Federated's policy that business must be conducted in accordance with the highest fiduciary, legal and ethical standards.  Federated's reputation for integrity is its most important asset and each Access Person must contribute to the care and preservation of that asset.  This reputation for integrity is the cornerstone of the public's faith and trust in Federated; it is what provides Federated an opportunity to serve investors, shareholders and other stakeholders.  A single Access Person's misconduct can damage Federated's hard-earned reputation.

This Code sets forth the fiduciary, legal and ethical requirements and certain “best practices” that must be satisfied to comply with this Code.  This Code also establishes procedures that Access Persons must follow in order to comply with this Code.

Key terms are defined in Section 8 of this Code.

Access Persons.                                                Access Persons are defined under Section 8.4 of this Code and include:

(a) Designated employees of Federated, including those who work for any subsidiary that is an Adviser, an Underwriter for funds and employees of certain other subsidiaries;

(b) Independent Directors of a fund;

(c) Designated officers of Federated funds or proprietary funds who are not employed by Federated. (e.g., designated outside counsel who serve as secretary to one or more funds); and

(d) All Investment Personnel;

(e) Any other individual designated by the Compliance Department.  This may include a Federated employee or a temporary hire, vendor, service provider or other third party employee.

Application to Access Persons.  This Code applies only to those individuals specified above, designated as Access Persons under this Code.  Please note that certain requirements of this Code apply to Access Persons, while others may only apply to Investment Persons.

Application to Household Members.  As noted above, each Access Person also is responsible for assuring that spouses, children or any others residing in the same household do not violate the provisions of this Code that are applicable to the Access Person (even if certain provisions of this Code do not specifically reference household members).  See the definitions of "Access Person" and "Investment Personnel" in Section 8 of this Code for further information.

This Code also applies to accounts or holdings for persons outside the household, over which the Access Person has investment discretion, influence or control.

Questions.  All Access Persons are obligated to read the requirements of this Code carefully.  If you have any questions regarding how this Code applies to any conduct or practice, please contact the Compliance Department.  When in doubt, an Access Person should ask before taking any action.

Compliance with Other Requirements Still Required.  This Code supersedes prior versions of this Code.  This Code does not supersede, or relieve an Access Person from complying with applicable laws or with other Federated standards and corporate and departmental policies or procedures which can be found on Federated’s internal website.  A violation of any of these policies or procedures by an Access Person may, depending upon the circumstances, also constitute a violation of this Code.

Sanctions for Violations of this Code.  Federated intends to enforce the provisions of this Code vigorously.  A violation of this Code may subject an Access Person to sanctions as set forth in Section 7 below, and possible civil and criminal liability.

Adoption.  Pursuant to Rule 17j-1 under the 1940 Act and Rule 204A-1 under the Advisers Act (as applicable), this Code has been adopted on behalf of each investment company that is served by the Board of Directors of the Federated funds, Federated's Advisers and Federated's Underwriters.

1   Responsibilities

1.1   General Principles

The following general principles govern all conduct of Access Persons, whether or not the conduct also is covered by more specific standards or procedures set forth below.

(a)           Fiduciary Principles

Each Access Person must:

·   (i)                 place the Funds’ interests ahead of his or her personal interests;

·   (ii)                 disclose and, where possible, avoid conflicts of interest (actual or potential) and the appearance of any conflict with the Funds or any other party;

·   (iii)                 conduct his or her personal transactions in a manner, which is consistent with this Code and which does not interfere with Fund portfolio transactions or otherwise take unfair or inappropriate advantage of his or her position or relationship to a Fund or any other party;

·   (iv)                 not show inappropriate favoritism of one Fund over another Fund in a manner that would constitute a breach of fiduciary duty;

·   (v)                 not accept or offer inappropriate gifts, favors, entertainment, special accommodations or other things of material value that could influence decision-making by either Federated, an Adviser, a Fund or any other party;

·   (vi)                 safeguard material nonpublic Fund information and control its dissemination in a manner consistent with Federated’s policies and applicable legal requirements; and

·   (vii)                 otherwise act in good faith, in an open, honest, non-misleading, professional and unbiased manner, with integrity, and in a manner that instills trust and confidence and promotes independence in the investment decision-making process, in each aspect of the Access Person’s professional activities and business (including, without limitation, in all disclosures, advertisements and other communications, and dealings, with Funds, shareholders and accountholders).

For example, an Access Person’s failure to recommend or purchase a Covered Security for the Fund in order to purchase the Covered Security for the Access Person’s personal benefit may be considered a violation of this Code.

(b)           Legal Principles

In addition to complying with the above fiduciary principles, each Access Person must comply with State and Federal securities laws, rules and regulations.  If you have questions concerning complying with applicable law, contact the Compliance Department or Federated's General Counsel.

1.2   Compliance with this Code is a Condition of Employment

Every Access Person must adhere to the general principles set forth in Section 1.1 above, and comply with the specific provisions and Associated Procedures of this Code and the spirit of those provisions.  Literal compliance with specific provisions will not be sufficient where the transactions undertaken by an Access Person show a pattern of abuse of the Access Person’s fiduciary duty or of violation of applicable legal requirements.

1.3   Personal Responsibility

It is the responsibility of each Access Person to take all steps necessary before executing a personal trade, or taking other action, to verify that the trade or other action is in compliance with the provisions and intent of this Code.

1.4   Perceived Ambiguity shall not Excuse Violations

Any Access Person who believes a particular provision of this Code is ambiguous is required to contact the Compliance Department for a determination prior to executing a transaction or taking other action subject to that provision.

1.5 Preclearance does not Protect Wrongdoing

Receipt of express prior preclearance approval does not exempt you from the prohibitions outlined in this Code.

2   Reporting Requirements

The Reporting Requirements in Sections 2.1, 2.2, and 2.3 of this Code apply to Access Persons and their household members (generally including members of the immediate family sharing the same household, e.g., a spouse and unemancipated children) and certain partnerships, trusts, corporations or other similar arrangements.  Access Persons should contact the Chief Compliance Officer for further clarification if they have questions regarding the application of this Code.

Every Access Person must report (1) all Covered Securities in which the Access Person or members of his or her household have direct or indirect investment discretion, influence or control (either for the benefit of the Access Person or for any other party), (2) all transactions in those Covered Securities, and (3) all accounts in which any Covered Securities are held.  An Access Person is deemed to have influence or control over a discretionary account as described in Section 4.2.

NOTE: All information provided by the Access Person must be current as of a date no more than 45 days before the report is required to be submitted.  Failure to provide that information within the time specified (if it is not being provided directly to Compliance by the financial institution or other party) shall be deemed a violation of the Code and SEC Rules.

Covered Securities transactions of Access Persons will be reviewed for compliance with the provisions of this Code.  A violation may result from either a single transaction or multiple transactions if the Compliance Department determines that the transaction(s) did not comply with provisions of this Code.

Information relating to the holdings and personal trades of Access Persons will be shared with Senior Management of Federated from time to time for purposes of reviewing Access Person trading patterns and practices.

2.1   Initial Reporting Requirements

Within ten (10) calendar days of becoming an Access Person, the Access Person is required to submit to the Compliance Department, a holdings report including:

(a) The full security name and description (i.e., type), CUSIP, SEDOL or exchange ticker symbol, number of shares and principal amount of each Covered Security held in any form, (e.g., brokerage/bank accounts, registered holdings, physical certificates, etc.) in any location, in which the Access Person or householdmember had any direct or indirect investment discretion, influence or control, including, without limitation, those shares of Federated funds included under this Code’s definition of “Covered Security,”

(b) All investment accounts with a financial institution or intermediary, including he name and address of any broker, dealer, bank or other financial institution holding any Securities in which the Access Person or members of his or her household have any direct or indirect investment discretion, influence or control, and the account numbers (this does not include accounts held directly with Federated’s Transfer Agent or 401k Plan Administrator);

(c)           The date the Access Person submits the report.

The Compliance Department will direct the broker, dealer, bank or other financial institution maintaining each account to provide duplicate confirmations of all transactions and account statements directly to the attention of the Compliance Department, in a timely fashion.  The Compliance Department also will obtain reports on accounts held directly with Federated’s Transfer Agent or 401k Plan Administrator.  Each Access Person must assure that such information is received.

2.2   Quarterly Reporting Requirements

By the date specified by the Compliance Department (but in no eventlater than thirty (30) calendar days after the end of the calendar quarter) every Access Person must review the information recorded by the Compliance Department relating to his or her personal accounts (discretionary and non-discretionary) and all transactions in any Covered Securities, regardless of the form in which such securities are held, (e.g., brokerage/bank accounts, registered holdings, physical certificates, etc.), and each Access Person must complete and submit to the Compliance Department a quarterly Securities transaction report, using TradeComply where available, to:

(a) Identify and confirm that all Covered Security transactions during the previous calendar quarter in all accounts in which the Access Person or household members have a direct or indirect investment discretion, influence or control, have been reported, including, without limitation, transactions in Federated funds included under this Code’s definition of “Covered Security” that are held in accounts with a financial institution or intermediary (this does not include accounts held directly with Federated’s Transfer Agent or 401k Plan Administrator);

(b) Identify and confirm that all investment account information has been reported, including any new investment account(s) established during the quarter with broker-dealers, banks or other financial institutions holding any Securities in which the Access Person or members of his or her household have any direct or indirect investment discretion, influence or control, along with the name and address of the intermediary, the date the account was established and account number;

(c)           Resolve any discrepancies identified with the Compliance Department; and

(d) Record an electronic signature and date on TradeComply or other process approved by the Compliance Department.

The information required in Section 2.2(a) above shall include at least the following information about each transaction involving a Covered Security in which the Access Person or household member had, or as a result of a transaction acquired, any direct or indirect investment discretion, influence or control:  (1) the date of the transaction, (2) the full security name, description (i.e., type), CUSIP, SEDOL or exchange ticker symbol, interest rate, maturity date, number of shares and principal amount of each Covered Security held, (3) the nature of the transaction (i.e., purchase, sale or any other type of acquisition or disposition), (4) the price of the Security at which the transaction was effected, and (5) the name of the broker, dealer, bank or other financial institution with or through which the transaction was effected.

An Access Person need not submit a quarterly Securities transactions report to the extent that the report would duplicate information contained in broker trade confirmations or account statements delivered to Federated so long as trade confirmations or account statements are received by the Compliance Department no later than 25 days after the end of the applicable calendar quarter.

2.3   Annual Reporting Requirements

On an annual basis and by the date specified by the Compliance Department (but in no event later than thirty (30) calendar days after a request) from the Compliance Department, every Access Person is required to provide a written acknowledgment (1) that he or she is subject to, has received a copy of and read this Code, and (2) of his or her understanding of and compliance with this Code, its requirements and Associated Procedures.  At the same time, the Access Person must review a current list of Covered Securities held in the Access Person’s account(s), as recorded by the Compliance Department, for accuracy, and complete and submit to the Compliance Department an annual report using TradeComply to:

(a) Identify and confirm all Covered Securities held in any form (e.g., brokerage/bank accounts, registered holdings, physical certificates, etc.) in any location, in which the Access Person or household member had any direct or indirect investment discretion, influence or control, including the full security name and description (i.e., type), CUSIP, SEDOL or exchange ticker symbol, number of shares and principal amount of each Covered Security held, including, without limitation, those shares of Federated funds included under this Code’s definition of “Covered Security,” that are held in accounts with a financial institution or intermediary (this does not include accounts held directly with Federated’s Transfer Agent or 401k Plan Administrator);

(b)           Resolve any discrepancies with the Compliance Department, and

(c) Record an electronic signature and date on TradeComply or other process approved by the Compliance Department.

2.4   Independent Directors

Independent Directors must report all holdings and transactions in shares of Federated funds included under this Code’s definition of “Covered Security” that are held in accounts with a broker-dealer, bank or other financial institution or intermediary (this does not include accounts held directly with Federated’s Transfer Agent or 401k Plan Administrator).

Except for holdings and transactions involving Federated funds, an Independent Director (unless previously identified by the Compliance Department as being an Access Person who cannot take advantage of this Section) is exempt from all other reporting requirements so long as, at the time of a personal transaction in a Covered Security, such Independent Director neither knew nor, in the ordinary course of fulfilling his or her official duties as a fund director, should have known that during the 15-day period immediately before or after the director's transaction that the Covered Security was purchased or sold by the Fund, or considered for Purchase or Sale.

Any Independent Director who is identified by the Compliance Department as being an Access Person who cannot take advantage of this Section must comply with all reporting requirements applicable to Access Persons set forth in this Code or its Associated Procedures.

2.5   Non-Federated Officers of Federated Funds or Proprietary Client Funds

(a) Non-Federated personnel serving as officers of a fund who are specifically designated as Access Persons subject to this provision shall be so notified by the Compliance Department and shall be deemed to be Access Persons.

(b) Such specially designated Access Persons shall be subject to all provisions under this Code applicable to Access Persons (as applicable), except that only the following provisions apply:

Section 1	Responsibilities
Section 2	Reporting Requirements
Section 4.1	Exempt Securities
Section 4.2	Discretionary Accounts
Section 5.1	General Prohibitions
Section 5.2	Equity Initial Public Offerings (IPOs) are Prohibited
Section 5.3	Private Placements Require Prior Compliance Approval
Section 5.5	Minimum Holding Period – Designated Federated Funds
Section 5.6	Prohibition on Insider Trading
Section 5.7	Disclosure or Misuse of Fund Information
Section 5.9	Prior Knowledge
Section 5.11	Excessive Trading and Market Timing
Section 5.13	Restrictions on Investment Clubs
Section 5.14	Disclosure of Personal Interests
Section 6	Prohibitions on Giving/Receiving Gifts; Political and Charitable Contributions
Section 7	Review, Reporting, Education and Sanctions
Section 8	Definitions

(c) Each specially designated Access Person must notify the Compliance Department of any positions held on the Board of Directors of any publicly held company and any “for-profit” private company.  In the event that the Access Person, thereafter, should be advised of an issue relating to any such company, the Access Person must recuse himself or herself from any discussion or consideration of such issues.

(d) Violations of this Code and/or suspicious trading activity shall be reported by the Compliance Department to the Senior Manager of such Access Person.  A report by the employer of the steps taken in response to the issues raised shall be requested by the Compliance Department and reported to Federated management, and, in the case of a personal transaction that conflicts with a mutual fund transaction, the fund’s Audit Committee and, ultimately, the fund’s Board of Directors.

2.6   Access Persons Acknowledgments of Receipt of Code of Ethics and Amendments

(a) The Compliance Department shall provide each Access Person with a copy of this Code annually.  The Compliance Department also shall provide each Access Person with a copy of any amendment to this Code promptly after such amendments are adopted (and, to the extent possible, prior to their effectiveness).

(b) After receiving the copy of this Code or an amendment to this Code, each Access Person is required to provide the Compliance Department, within the time period prescribed by the Compliance Department, a written or electronic acknowledgment (1) that he or she has received and read this Code or such amendment, and (2) of his or her understanding of and compliance with this Code or such amendment, its requirements and any Associated Procedures.

3   Preclearance Requirements

3.1   Preclearance of Trades

Unless subject to a preclearance exception, all Access Persons must preclear every Purchase or Sale of a Covered Security in which the Access Person or member of his or her household has any investment discretion, influence or control (including, without limitation, transactions in pension or profit-sharing plans, Equity Initial Public Offerings (IPOs) (to the extent approved as satisfying the limited exceptions in Sections 5.2(a) or (b) to the general prohibition), and Private Placements), in accordance with the Associated Procedures governing preclearance.

(a) All Private Placement securities must be precleared by contacting the Compliance Department;

(b)           All other Covered Securities must be precleared using TradeComply;

(c) Access Persons without access to TradeComply must contact the Compliance Department for assistance in preclearing transactions on their behalf.

3.2   Duration and Revocation

Preclearance approval remains in effect until the end of the following business day.  Preclearance approval may be revoked at any time upon notification of revocation being provided by the Compliance Department.  Any revocation shall not affect any transaction made prior to such revocation notice being delivered during a time when the preclearance approval was effective.

3.3   Preclearance Does Not Protect Wrongdoing

Preclearance approval and the receipt of express prior preclearance approval does not exempt an Access Person from the prohibitions outlined in this Code.

3.4   Exceptions

Preclearance requirements do not apply to:

(a) Shares of any registered open end investment companies, including, without limitation, Federated funds included under this Code’s definition of “Covered Security” (note that this exception does not apply to ETFs; all ETF transactions must be precleared);

(b) Involuntary purchases or sales, including mandatory corporate actions (e.g. corporate mergers, exchanges);

(c) Automatic Investment Plans, including, without limitation, dividend reinvestment plans; or automatic payroll deduction plan purchases that are either (a) made solely with the dividend proceeds, or (b) whereby an employee purchases Securities issued by an employer;

(d) Exercise of rights to purchase and any sales of such rights issued by an issuer pro rata to all holders of a class of its Covered Securities, to the extent such rights were acquired from such issuer;

(e) Exercise of rights to tender Securities when an offer is made on a pro rata basis to all holders of a class of Covered Securities;

(f)           Gifts or charitable donations of a Covered Security;

(g) Purchases or sales in discretionary accounts (as outlined in Section 4.2) and/or purchases or sales in other accounts over which the Access Person or household member had or has no investment discretion, influence or control.

(h) Purchases and sales of Covered Securities executed by an Independent Director.

NOTE: Notwithstanding anything in this Section to the contrary, Equity Initial Public Offerings (IPOs) (to the extent approved as satisfying the limited exceptions in Sections 5.2(a) or (b) to the general prohibition) and Private Placements shall in no event be exempt from the preclearance requirements.

3.5   Exception for Employee Stock Options of a Previous Employer

Subject to the conditions indicated, an Access Person or Investment Person may exercise employee stock options for Securities of a previous employer, as follows:

(a) Access Persons and Investment Persons who are not also Portfolio Managers, Traders or Research Analysts may exercise employee stock options for Securities of a previous employer for cash or in a cashless exercise and hold the stock thereafter without preclearance or restriction that would otherwise be imposed by concurrent fund transactions, but must report the Securities when exercised.

(b) Investment Persons who are Portfolio Managers, Traders or Research Analysts may exercise such an employee stock option for cash or in a cashless exercise and hold the stock thereafter, without restriction that would otherwise be imposed by concurrent fund transactions after requesting and receiving in writing a determination by the Compliance Department that no material conflict of interest exists.

(c) A cashless exercise of employee stock options of a previous employer may occur without regard to the 60-day rule.

(d) All such exception provisions for the exercise of employee stock options shall be conditioned on:

(i) Access Persons and Investment Personnel who are not Portfolio Managers, Traders or Research Analysts must notify the Compliance Department of the exercise of any employee stock options within five business days.

(ii) Investment Personnel who are Portfolio Managers, Traders or Research Analysts must request a determination in writing by the Compliance Department that no apparent material conflict of interest exists prior to the exercise of any employee stock options and may not proceed with the exercise until such determination is received.

(iii) Approval of any such exercise shall be conditioned on full disclosure to the Compliance Department of all communications concerning that Security within Federated by the Access Person or Investment Person during the seven days prior to the exercise of an employee stock option.

(iv) Any apparent conflict of interest that is identified by the Compliance Department, before or after an exercise of employer stock options shall be reported to the President of the Advisory Companies and the Chief Executive Officer of Federated Investors, Inc., and investigated further for determination as to whether a violation has occurred.

3.6 Federated Stock and Options Trading

(a) All Federated employees are prohibited from trading Federated stock during announced blackout periods.

(b) All Federated employees are prohibited from short selling Federated stock.

(c) All Federated employees are further prohibited from options trading on Federated stock or purchasing Federated stock on margin without Compliance Committee approval.

Note: Employees should refer to the Federated Policy on Trading and Confidentiality for additional details.

3.7 Special Rules forEquity Transactions Based on Market Capitalization

(a) To insure proper compliance with the Code and limit unintended preclearance mistakes, the Chief Compliance Officer, in conjunction with the President of the Advisory Companies may require individuals or select groups of Portfolio Managers, Analysts and Traders to manually preclear all trades in Equity Securities and further require that transactions in equity securities of issuers having a market capitalization of less than $500 Million be submitted for preclearance and the written approval of the CIO – Equities and the Chief Compliance Officer;

(b) All significant micro cap holdings of Access Persons (defined as any equity securities having a market capitalization below the Small Cap breakpoint or minimum as measured and published from time to time by Morningstar Direct) will be monitored and compared to Fund holdings for any appearance of conflicts of interest.  The Compliance Department will review this information with the CIO - Global Equity to identify any holdings that might require special preclearance and may impose a blackout or holding period of up to 90 days from the date of the last Fund trade in such security.  These additional requirements will be communicated to and discussed with each affected Access Person as they are identified.

4   Exempt Transactions

4.1   Exempt Securities

Unless otherwise specified within this Code, purchases or sales of the following Securities are not subject to the Preclearance (Section 3) or Prohibitions and Restrictions (Section 5) sections of this Code:

(a) Direct obligations of the Government of the United States and U. S. Government Agencies;

(b)           Bankers’ acceptances;

(c)           Bank certificates of deposit;

(d)           Commercial paper;

(e) High quality short-term debt instruments1, including, without limitation, repurchase agreements; and

(f) Shares of those registered open-end investment companies that are not included under this Code’s definition of “Covered Security”.

NOTE:  Specified provisions of this Code are applicable to investment in Federated funds included under this Code’s definition of “Covered Security”.

4.2   Discretionary Accounts

Discretionary accounts over which the Access Person (or household member) has no investment discretion, but over which the Access Person retains control to designate an investment manager, are not subject to preclearance requirements (Section 3), prohibition of short-term profits (Section 5.4) or blackout periods caused by fund transactions (Section 5.8), but retain the prohibition on trading Federated stock (Section 3.6), Equity Initial Public Offerings (IPOs) (Section 5.2), the limitations of Private Placements (Section 5.3), and minimum holding period (Section 5.5) specified in this Code and are subject to all reporting requirements (Section 2).

It is the Access Person’s responsibility to notify his or her broker or manager of these restrictions and limitations.

Access Persons establishing discretionary accounts and the individuals accepting discretionary authority over such accounts are required to acknowledge, in writing, their understanding and acceptance of the restrictions applicable to such accounts.  Access Persons must provide information relating to the investment objective and any restrictions placed on his or her (or household member's) discretionary account(s) and any changes made to those objectives or restrictions to the Compliance Department.

5   Prohibitions and Restrictions

5.1   General Prohibitions

Every Access Person is prohibited from:

(a)           Employing any device, scheme or artifice to defraud the Fund;

(b) Making any untrue statement of a material fact to the Fund or omitting to state a material fact necessary in order to make the statements made to the Fund, in light of the circumstances under which they are made, not misleading;

(c) Engaging in any act, practice or course of business that operates or would operate as a fraud or deceit on the Fund; or

(d)           Engaging in any manipulative practice with respect to the Fund.

Examples: Causing the Fund to purchase a Covered Security owned by the Access Person for the purpose of supporting or driving up the price of the Covered Security, and causing the Fund to refrain from selling a Covered Security in an attempt to protect the value of the Access Person's investment, such as an outstanding option.

Without limiting the foregoing:

(i)   Each Access Person is prohibited from usurping investment or other business opportunities of a Fund for personal benefit (or for the inappropriate benefit of Federated).  Each Access Person owes a duty to the Funds to advance the Funds’ legitimate interests when the opportunity to do so arises.  This duty of loyalty is violated if an Access Person personally profits (or allows Federated to inappropriately profit) from an investment or other business opportunity that rightfully belongs to a Fund.  This problem could arise, for example, if an Access Person becomes aware through the use of Federated or Fund property, information or relationships of an investment opportunity (either a loan or equity transaction) in which the Fund is or may be interested, and then participates in the transaction personally or informs others of the opportunity before offering it to the Fund.  An Access Person is prohibited from using Federated or Fund property, information or relationships for personal gain (or for the inappropriate gain of Federated);

(ii)   Each Access Person is prohibited from taking inappropriate or unfair advantage of his or her relationship with a Fund or a Vendor.  Under this duty of fair dealing, no Access Person should take advantage of a Fund or a Vendor, or another person or entity, through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair dealing practice.  All business conducted on behalf of Federated is to be done with integrity and high fiduciary, legal and ethical business standards;

(iii)   Each Access Person is prohibited from misappropriating Federated or Fund assets; and

(iv)   Each Access Person is prohibited from taking any action to fraudulently influence, control, coerce, manipulate or mislead any independent accountants engaged in the performance of an audit of Federated's or a Fund's financial statements for the purpose of rendering such financial statements materially misleading.

(Any Access Person who is a director, officer or employee of Federated should also refer to the "Corporate Opportunities," "Fair Dealing," "Protection and Proper Use of Company Assets" and "Improper Influence on the Conduct of Audits" requirements in Federated's Code of Business Conduct and Ethics.  If you have questions concerning the duty of loyalty, the duty of fair dealing, use of assets or conduct of audits, contact the Compliance Department or Federated’s General Counsel.)

5.2   Equity Initial Public Offerings (IPOs) are Prohibited

Access Persons may not directly or indirectly acquire Beneficial Ownership or exercise investment discretion, influence or control in any equity Security in an Initial Public Offering (IPO) without prior approval.  Exceptions may be approved in the following instances:

(a) Initial Public Offerings (IPOs) relating to Securities of the employer of a spouse, when offered to all employees at the spouse’s level, or the demutualization of insurance companies, banks or savings and loans, if the Access Person owned a policy or held such a prior interest or relationship in or with the issuer, are allowed, and

(b) Initial offering of diversified investment funds, including, without limitation, closed-end funds and unit investment trusts (or "UITs") are allowed.

All such exceptions require reporting and preclearance approval in accordance with the provisions of Sections 2 and 3 above.

Initial public offerings in fixed income securities are permitted, however no Access Person will be allowed to invest in a fixed income Security during a blackout period caused by a Fund trade.

5.3   Private Placements Require Prior Compliance Approval

Access Persons may not directly or indirectly acquire Beneficial Ownership or exercise investment discretion, influence or control in any Private Placement Security without prior approval.  Any such transaction requires reporting and preclearance approval directly from the Compliance Department.  No Access Person will be allowed to invest in a Private Placement Security in which a Fund has an investment or contemplates participation.

If an Investment Person receives prior approval and acquires a Private Placement, Security the Investment Person must disclose this investment to the Chief Investment Officer (or the Chief Investment Officer’s designee) before the Investment Person may participate in any subsequent consideration of any potential investment by a Fund in the issuer of that Security.

Following a purchase by an Investment Person in an approved personal transaction, any purchase by a Fund of Securities issued by the same company (other than secondary market purchases of publicly traded Securities) will be subject to an independent review by the Compliance Department.

5.4   Prohibition of Short-Term Profits – 60 Day Rule – Individual Securities

As a general rule, personal Securities transactions of Access Persons should be for long-term investment purposes and should not be initiated for short-term profits.  Profits realized on the sale of an individual Security held less than 60 days must be disgorged.

(a) When a new purchase results in multiple lots of a Security held in personal portfolios, no lot of the same Security may be sold within 60 days if sale of any lot of the Security would result in a gain.

(b) Similarly, no Security may be purchased within 60 days of the sale of the same Security, unless the Security is purchased at a price greater than the price of any sale of the Security within the prior 60 days.

5.5   Minimum Holding Period – Designated Federated Funds

Any holding of a Federated fund which, according to its prospectus has adopted Frequent Trading Policies and is subject to monitoring for Frequent Trading will be subject to the following conditions:

(a)   The minimum required holding period for shares of Federated funds subject to monitoring for Frequent Trading is 60 days, unless the particular fund has a redemption fee provision lasting for a longer period, in which case the minimum holding period will be the same as the redemption fee period.  Holding periods will be measured for fund transactions for this condition on a "first in, first out" (FIFO) accounting basis.

(b)   In addition to the holding period specified above, shares of Federated funds that are subject to monitoring for Frequent Trading are further subject to the limitations expressed within the prospectus regarding frequency of trading that may be deemed excessive or disruptive, including but not limited to purchases and sales within 30 days or trading that is deemed disruptive over periods longer than 30 days.  Such frequent or disruptive trading may occur in the same account or more than one account; that is to say that a purchase may be made in one account and a sale in another account and still be subject to these provisions.   Access persons making asset allocation adjustments (transfers between or re-balancing) to investments in Federated funds that are subject to monitoring for Frequent Trading must observe these limitations and restrictions.   A violation of the Frequent Trading Policies of any Federated Fund will be treated as a violation of the Code and will be subject to sanctions imposed by the Chief Compliance Officer.

(c)   Systematic purchases (periodic contributions or 401k deferrals) or systematic or periodic withdrawals, that are part of a regular pattern, as determined by the Compliance Department, will generally not trigger a holding period violation.  Similarly, required income distributions by a trust, minimum required individual retirement account (IRA) distributions and 529 Plan distributions for education expenses will not generally trigger a holding period violation.

(d)   The Compliance Department shall be authorized to grant further exception from the required holding period in cases of exceptional hardship that could not be reasonably foreseen by an Access Person.

5.6   Prohibition on Insider Trading

Use of material, non-public information about any issuer of Securities by an Access Person is prohibited, regardless of whether such Securities are held by or have been recommended for any Fund.  “Material non-public information” relates not only to issuers, but also includes, without limitation, an Adviser’s Securities recommendations and Fund Securities holdings and transactions.  In limited instances, awareness of material, non-public information relating to a specific Federated Fund, could subject certain Access Persons, as identified by the Compliance Department, to a blackout period during which those specified Access Person would be prohibited from buying or selling shares of the Fund.

(See the Federated “Policy on Trading and Confidentiality” for more information.  Also, any Access Person who is a director, officer or employee of Federated should also refer to the "Insider Trading" requirements in Federated's Code of Business Conduct and Ethics.  If you have questions concerning insider trading issues, contact the Compliance Department or Federated’s General Counsel.)

5.7   Disclosure or Misuse of Fund Information

Selective disclosure to third parties or misuse of any material, nonpublic Fund-related information by an access person is prohibited.  No portfolio holdings or any other material, nonpublic information regarding a Fund may be disclosed, unless the same data is posted on the public website for other investors or is otherwise publicly available on a simultaneous basis.  “Material” information is defined as any Fund-related information that might be expected to impact an investor's decision to buy, sell or hold a Fund or Security, and may include, without limitation, holdings, trading strategies, pending transactions, performance or performance attribution, duration, yields or other key statistics.  Requests for public disclosure of previously undisclosed information or to release information on a more frequent schedule must be approved by the President of the Advisory Companies and the Chief Compliance Officer.

The Purchase or Sale of Federated fund shares based on material, nonpublic information about the fund's portfolio is similarly prohibited.

(See the Federated “Fund Information Disclosure Policy” for more information. Also, any Access Person who is a director, officer or employee of Federated should also refer to the "Confidentiality" requirements in Federated's Code of Business Conduct and Ethics.  If you have questions concerning disclosure or misuse of Fund information, contact the Compliance Department or Federated’s General Counsel.

5.8         Blackout Periods – Fund Trades

Portfolio Managers and Research Analysts identified as serving a Fund or group of Fund(s) are prohibited from purchasing or selling any Covered Security for which there is an open “buy” or “sell” order or any Covered Security that has been purchased or sold by those Fund(s) in any amount within fifteen (15) calendar days before or after the Fund purchases or sells that Security.  All such transactions will trigger a blackout period.  This provision supersedes any prior preclearance.

Investment Personnel who are not among the Portfolio Managers and Research Analysts identified as serving the Fund(s), as provided above, may not purchase or sell a Covered Security within seven (7) calendar days after one or more Funds have open “buy” or “sell” orders and/or purchases or sells in the same Covered Security in an amount sufficient to trigger a blackout period, subject to any prior preclearance.

All other Access Persons may not purchase or sell a Covered Security on any day during which one or more Funds have open “buy” or “sell” orders and/or purchases or sells the same Covered Security in an amount sufficient to trigger a blackout period, subject to any prior preclearance.

NOTE:  For purposes of administering this Section, all MDT employees shall be considered Investment Personnel, but generally no MDT employees shall be considered portfolio managers, traders or research analysts.

The Compliance Department shall have discretion in determining the methodology by which blackout periods are calculated.

5.8   Prior Knowledge

No Access Person may execute a personal transaction, directly or indirectly, in any Covered Security and no prior preclearance will apply, when he or she knows, or should have known, that the Covered Security is being:

(a)   Considered for Purchase or Sale by the Fund; or

(b)   Purchased or sold by the Fund.

5.9   Serving as a Director or Officer of Outside Organizations

This Section applies to Access Persons, but not any household members of such Access Persons.

While serving the community is a worthy objective, a director or officer of any organization has access to sensitive information and charts the course of that entity.  Federated must take safeguards to shield Federated and Access Persons (including, without limitation, Investment Personnel) from even the appearance of impropriety.  To that end:

(a) All Access Persons are prohibited from serving as an officer or director of any other organization unless written approval is first granted by the Compliance Committee.  Approval of the Committee is not required in those situations where the organization is not-for-profit and does not issue securities.

(b) All Access Persons must notify the Chief Compliance Officer in writing (by completing the Non-Federated Business or Board Activity request form) of any organization for which such Access Person serves in compliance with this Section: (1) initially upon becoming an Access Person or, (2) before they accept and begin to serve as an officer or director, and/or (3) upon resigning from any such position.

(c) If approval to serve as an officer or director of an organization is granted, an Access Person has an affirmative duty to (1) recuse himself or herself from participating in any deliberations inside Federated regarding such organization, and (2) not share non-public information of such organization with any Federated personnel (including, without limitation, any Investment Personnel).

(d) The President of the Advisory Companies and all Investment Personnel reporting directly or indirectly to him are further prohibited from serving as an officer or director of any publicly issued or privately held issuer of a Security (whether “for profit,” “not for profit,” “charitable” or otherwise) that is or may become an eligible investment for a Fund unless an exception is granted by the Compliance Committee pursuant to the following provisions:

(i)   In the case of charitable, eleemosynary, municipal or educational organizations only, if the organization has no securities outstanding or if all Chief Investment Officers confirm in writing that the securities of the issuer either are not qualified for investment by the funds or that adequate alternative investments are available, and the President of the Advisory Companies approves, then the Compliance Committee may approve service as an officer or director by an Investment Person, subject to semi-annual confirmation by the Chief Investment Officers and approval by the President of the Advisory Companies that these conditions have not changed.

(ii)   In the instances specified in Paragraph d. (i) of this Section, above, the Compliance Department shall maintain the organization on the Funds Restricted List.  Inclusion on the Restricted List shall make any security of the issuer an ineligible investment for the funds.  The Compliance Department shall communicate the Restricted List to all Chief Investment Officers and the President of the Advisory Companies quarterly.

(iii)   If an Investment Person, at the time of adoption of this amended provision of the Code or, in the case of a new hire, at the time of his or her employment, is serving as an officer or of a charitable or eleemosynary organization that has issued securities eligible for or owned by the funds, then the Investment Person shall recuse himself or herself from all discussions concerning possible investment by the funds in such security and may request that his or her current term in such role may be completed.  The Compliance Committee may approve completion of terms under such circumstances if it deems the remaining term reasonable.   Approval to continue a current term will not permit the Investment Person to begin another term on the board.

(iv)   If a Security issued by a charitable or eleemosynary organization becomes an eligible investment for a Fund while an Investment Person is serving as an officer or director, the Investment Person shall be subject to the same terms as are provided in Paragraph (d)(iii) of this Section, above.

(v)   If a Security issued by any organization that is not a charitable or eleemosynary organization becomes an eligible investment for a Fund after an Investment Person has begun serving as an officer or director, the Investment Person must immediately resign from such role and recuse himself or herself from all matters relating to the organization.

(e) If an Access Person serves as an officer or director of a non-public organization, and the organization seeks to issue securities, such Access Person must, promptly after the company’s intention to issue securities becomes public, take steps to notify the Chief Compliance Officer in writing.  If an exception has not been reconfirmed under this Section or if continued service would be prohibited under this Section, as of the time when the organization’s securities are first offered to the public, then the Access Person must immediately resign from such board and recuse himself or herself from all board matters.

(f) Nothing in this Section limits or restricts service on the Board of Federated, its subsidiaries, Federated Funds, Proprietary Funds, or other funds administered by subsidiaries of Federated.

NOTE:  Any Access Person who is a director, officer or employee of Federated should also refer to the "Corporate Boards" requirements in Federated's Code of Business Conduct and Ethics.

5.10   Excessive Trading and Market Timing

(a) Access Persons are strongly discouraged from trading excessively.  This applies to both individual Securities and registered investment company Securities included under this Code’s definition of “Covered Security.”  The Chief Investment Officers, the President of the Advisory Companies and the Head of Trading will review the transaction volume of Investment Personnel on a monthly basis.  The transaction volume of other Access Persons may be reviewed with other managers periodically.

(b) Access Persons are prohibited from market timing.  This includes, without limitation, entering into any agreement or arrangement to permit market timing by any fund, shareholder or accountholder or in any fund, or by any broker, dealer, bank or other financial institution, person or entity.  Frequent or short-term trading into and out of funds can have adverse consequences for the funds, shareholders and accountholders who use the funds as long-term investment vehicles.  Such trading in significant amounts can disrupt the funds' investment strategies (e.g., by requiring the funds to sell investments at inopportune times or maintain excessive short-term or cash positions to support redemptions or cash flow needs), increase brokerage and administrative costs and affect the timing and amount of taxable gains distributed by or in respect of the funds.  Such trading may also seek to profit by estimating changes in a fund’s net asset value in advance of the time as of which net asset value is calculated.

5.11   Independent Directors

Notwithstanding the other restrictions or exemptions provided under this Code, Independent Directors (other than Independent Directors identified by the Compliance Department as being Access Persons subject to additional provisions of this Code) and their household members are subject only to the following Code restrictions:

Section 5.1                              General Prohibitions

Section 5.5                              Minimum Holding Period – Designated Federated Funds

Section 5.6                              Prohibition on Insider Trading

Section 5.7                              Disclosure or Misuse of Fund Information

Section 5.9                              Prior Knowledge

Section 5.11                              Excessive Trading and Market Timing

In order to monitor compliance with the above referenced Code provisions, Section 2.4 further requires Independent Directors to disclose holdings and transactions in certain Federated funds for themselves and their household members.

5.12   Restrictions on Investment Clubs

Investment Personnel who wish to participate in an investment club must request Chief Investment Officer approval prior to joining in the club activity.  Names of other club members must be disclosed.  The Chief Investment Officer shall notify the Compliance Department when such approval is granted.

Access Persons will be deemed to have investment discretion, influence or control in any trade by the club.  All investment club activity by any Access Person will require preclearance and must be reported by duplicate confirms and statements.

5.14                  Disclosure of Personal Interests

All Access Persons (including, without limitation, Investment Personnel) are prohibited from:

(a) Recommending, implementing or considering any Securities transaction for a Fund, or

(b) Negotiating any agreement or otherwise arranging for any relationship with any Vendor,

without having disclosed in writing to the Chief Investment Officer (in the case of Investment Personnel) (or another person designated by the Chief Investment Officer) (Chief Investment Officers shall disclose to the President of the Advisory Companies) or the Compliance Department (in the case of all other Access Persons):

(i)   any material Beneficial Ownership, business or personal relationship, or other material interest, that the Access Person has in an issuer or its affiliates, or in a Vendor, or

(ii)   other material conflict of interest that the Access Person has with an issuer or its affiliates or with a Vendor.

If the Chief Investment Officer (or other designated person) or Compliance Department determines that the disclosed interest is a material conflict of interest, then the Access Person may not participate in (a) any decision-making process regarding the Securities of that issuer, or (b) any negotiations or discussions with any Vendor.

In addition to the specific requirements above, each Access Person has the responsibility to use his or her best judgment to assess objectively whether there might be even the appearance of a conflict of interest or acting for reasons of personal gain (or the inappropriate gain of Federated to the detriment of a Fund, an issuer or its affiliates or a Vendor).  If you have questions regarding disclosure of personal interests and conflicts of interest, contact the Compliance Department or Federated’s General Counsel).

NOTE:  Refer also to the "Conflicts of Interest" and "Personal Financial Interests; Outside Business Interests" requirements in Federated's Code of Business Conduct and Ethics.

6   Prohibitions on Giving/Receiving Gifts; Political and Charitable Contributions

Access Persons are in a position of trust and must exercise great care to preserve their independence.  As a general rule, no Access Person should ever receive, solicit, make or offer an inappropriate payment or anything of value in exchange for a decision involving Federated's, a Fund's or a Vendor's business.  Decisions must be made in an unbiased manner.  Bribery, kickbacks and other improper payments have no place in Federated's business.

Without limiting the foregoing general principles:

(a) Every Access Person is prohibited from giving, either individually or in the aggregate with all other Access Persons, or receiving any gift, favor, preferential treatment, valuable consideration, or other thing of more than a de minimis value in any year to or from any Fund, or other person or entity, from, to or through whom Fund purchases or sells Securities, or an issuer of Securities or its affiliates or a Vendor.  For purposes of this Code, “de minimis value” is equal to $100 or less.  This prohibition does not apply to:

·   (i)      salaries, wages, fees or other compensation paid, or expenses paid or reimbursed, in the usual scope of an Access Person's employment responsibilities for the Access Person's employer;

·   (ii)                 meals, refreshments or entertainment of reasonable value in the course of a meeting or other occasion, the purpose of which is to hold bona fide business discussions;

·   (iii)                 advertising or promotional material of nominal value, such as pens, pencils, note pads, key chains, calendars and similar items;

·   (iv)                 the acceptance of gifts, meals, refreshments, or entertainment of reasonable value that are related to commonly recognized events or occasions, such as a promotion, new job or recognized holiday; or

·   (v)                 the acceptance of awards, from an employer to an employee, for recognition of service and accomplishment.

Note:    Access Persons must be aware that in certain instances, gifts and/or various forms of entertainment may be subject to lower limitations or be prohibited entirely to certain individuals, including government officials, and it remains the obligation of the Access Person to verify actual limits or prohibitions with the Compliance Department, (which may further require discussion with the Legal Department)  prior to making a gift or engaging in such other activities.  Such activities may be limited or prohibited by federal, state, local or foreign laws.

Investment Personnel should also refer to the Investment Management Gift and Entertainment Policy and Procedures.

(b) Every Access Person is prohibited from (i) making political or charitable contributions solely for the purpose of obtaining or retaining assets from, or advisory contracts or other business relationships with, federal, state, local or foreign governments or governmental agencies, or political subdivisions of any of them, or charitable organizations; and (ii) considering an Adviser’s or Federated’s current or anticipated business relationships as a factor in soliciting political or charitable donations.

NOTE:  Any Access Person who is a director, officer or employee of Federated should also refer to the "Payments and Gifts" requirements in Federated's Code of Business Conduct and Ethics.  Any Access Persons who are subject to the Broker-Dealer Written Supervisory Policies and Procedures also should consult those procedures for additional guidance on the receipt of gifts and gratuities. If you have questions regarding the receipt of gifts or political and charitable contributions, contact the Compliance Department or Federated’s General Counsel.

7   Review, Reporting, Education and Sanctions

7.1   Management Review of Investment Personnel’s Trading Activity

The President of the Advisory Companies, the Chief Investment Officers, the Head of Trading and such additional managers as the President of the Advisory Companies may designate will receive monthly reports of investment-related activity by Investment Personnel, such as preclearance requests, executed transactions and any other activity.  Personal investment data will be reviewed to determine whether the transactions conflict with any Fund activity and whether the transactions appear appropriate and consistent with the position and responsibility of the Investment Person.

7.2   Compliance Review of Reports and Trading Activity, and this Code of Ethics

Federated’s Compliance Department will review all initial holdings reports, confirmations, quarterly transaction reports, annual holdings reports and other reports and information required to be submitted under this Code to identify improper trading activity or patterns of trading, and to otherwise seek to verify compliance with this Code.  Without limiting the foregoing, the Compliance Department will review personal trading activity and trading records to identify possible violations, including:

(a)           Delay in reporting individual investments or investment accounts;

(b)           Failure to report individual investments or investment accounts;

(c)           Filing false or incomplete reports;

(d)           Failure to preclear individual trades;

(e)           Executing trades that violate provisions of this Code; and

(f)           Failure to comply with the receipt of gifts provision.

In addition, the review may also include (as applicable, and in the Compliance Department's discretion): (i) a comparison of personal trading to applicable restricted lists; (ii) an assessment of whether an Access Person is trading for his or her own account in the same Securities he or she is trading for Funds (and, if so, whether the Funds are receiving terms as favorable as the Access Person takes for himself or herself); (iii) an assessment of Access Person trading patterns for indications of abuse (including, without limitation, "market timing"); (iv) an analysis of any substantial disparities between the quality of performance an Access Person receives for his or her own account and that he or she receives for Funds; and (iv) an analysis of any substantial disparities between the percentage of personal trades that are profitable and the percentage that are profitable when he or she places trades for Funds.

Federated's Compliance Department also will review this Code, and the implementation, effectiveness and enforcement of this Code, at least once annually or more frequently in response to material changes in legal requirements or business practices, as contemplated by Federated's written compliance program.

7.3   Self-discovery and Reporting

(a) Each Access Person is required to report violations or suspected violations by any party of this Code promptly to the Compliance Department.  If the person within the Compliance Department that receives the report is not the Chief Compliance Officer, that person must report all violations reported to the Chief Compliance Officer.

(b) Immediate disclosure by an Access Person to the Compliance Department of a self-discovered violation and correction of that violation (including, without limitation, the immediate disgorging of any gain) will generally be treated as a violation to be recorded, but not as a material violation, if the Access Person has not benefited by the transaction and the Compliance Department determines that the violation was not intentional.

(c) It is Federated's policy that retaliation against Access Persons who report actual or suspected violations of this Code is prohibited.  Any actual or attempted retaliation will be treated as a separate violation of this Code, which will be subject to sanction in accordance with Section 7.5 below (including, without limitation, termination).

NOTE:  Any Access Person who is a director, officer or employee of Federated should also refer to the "Reporting of any Illegal or Unethical Behavior" requirements in Federated's Code of Business Conduct and Ethics.  If you have questions concerning reporting violations, contact the Compliance Department or Federated’s General Counsel.

7.4   Education

From time to time the Compliance Department will schedule training sessions or may otherwise distribute educational materials regarding this Code.  Access Persons are required to participate in all training sessions offered.  Access Persons will be required to provide a written acknowledgment that the Access Person received, read and understood the Code and its administration.

7.5   Sanctions

Upon determining that a violation of this Code or its Associated Procedures has occurred, the Chief Compliance Officer may take such actions or impose such sanctions, if any, as may be deemed appropriate, including, without limitation:

(a)           Issue a letter of censure;

(b)           Assess a fine, either nominal or substantial;

(c)           Require the unwinding of trades;

(d)           Require the disgorging of profits;

(e) Disallow discretionary accounts or required preclearance of discretionary account trades;

(f)           Prohibit or place further restrictions on personal trading or other activities;

(g)           Recommend suspension;

(h)           Recommend a reassignment of duties or job functions; or

(i)           Recommend that the employment of the violator be terminated.

7.6   Factors for Consideration

Sanctions listed above may be assessed individually or in combination.  Prior violations of the Access Person and the degree of responsibility exercised by the Access Person will be taken into consideration in the assessment of sanctions.

In instances where a member of the Access Person’s household commits the violation, any sanction will be imposed on the Access Person.

If extraordinary or unforeseen circumstances exist, an appeal may be directed to the Compliance Department.  Appeals are solely within the discretion of the Chief Compliance Officer.  The Chief Compliance Officer shall further have full discretion and authority to make special provision under and/or interpret or apply provisions of this Code.

7.7   Reporting of Violations

(a) Violations of Investment Personnel and proposed sanctions will be reported to the responsible Chief Investment Officer and/or Manager.  Violations of other Access Persons, and proposed sanctions, will be reported to the responsible Senior Manager. All violations and the proposed sanction will be reported to Senior Management and the Board of Directors of the Federated Funds quarterly.

(b) Any patterns or trends noted and any difficulties in administration of this Code shall be reported to Senior Management and to the Board of Directors of the Federated Funds, at least annually.

8   Definitions

8.1   1933 Act

The “1933 Act” means the Securities Act of 1933, as amended.

8.2   1934 Act

The “1934 Act” means the Securities Exchange Act of 1934, as amended.

8.3   1940 Act

The “1940 Act” means the Investment Company Act of 1940, as amended.

8.4   Access Person

“Access Person” means any person who participates in or who: (i) in connection with his or her duties, obtains or could obtain any information concerning recommendations on Covered Securities being made by the investment adviser to any Fund or (ii) any person who has access to nonpublic information regarding any Fund’s Purchase or Sale of Securities, or nonpublic information regarding the portfolio holdings of any Reportable Fund.

“Access Person” includes, without limitation, a director, trustee, officer, managing general partner, general partner, or Investment Person of a Fund, of the Underwriter, and of the Adviser and other persons designated by the Compliance Department,  any trust over which an Access Person is a trustee with investment discretion, influence or control, (either for the benefit of the Access Person or for any other party), any closely-held entity (such as a partnership, limited liability company or corporation) and any account (including, without limitation, any retirement, pension, deferred compensation or similar account) with respect to which the Access Person has investment discretion, influence or control.

Activity (including, without limitation, trading activity) by an Access Person’s household members will generally be attributed to the Access Person.  (If emancipated adult children or other independent parties also reside in the household, the Access Person must either declare that the Access Person has no discretion, influence or control over the investment decisions of such other party or the Access Person must report the party as an Access Person.)

8.5   Adviser

“Adviser” means any subsidiary of Federated registered as an investment adviser with the SEC.

8.6   Advisers Act

“Advisers Act” means the Investment Advisers Act of 1940, as amended.

8.7   Associated Procedures

“Associated Procedures” means those procedures and/or statements that have been adopted by the Underwriter, the Adviser, a Fund or the Compliance Department, and which are designed to supplement this Code and its provisions.

8.8   Automatic Investment Plan

“Automatic Investment Plan” means a program in which regular periodic purchases (or withdrawals) are made automatically in (or from) investment accounts in accordance with a predetermined schedule and allocation.  An “Automatic Investment Plan” includes, without limitation, a dividend reimbursement plan.

8.9   Beneficial Ownership

“Beneficial Ownership” will be attributed to an Access Person in all instances where the Access Person directly or indirectly (i) possesses the ability to purchase or sell the Covered Securities (or the ability to direct the disposition of the Covered Securities); (ii) possesses voting power (including the power to vote or to direct the voting) over such Covered Securities; or (iii) receives any benefits substantially equivalent to those of ownership.  It is the intent of Federated that “Beneficial Ownership” be interpreted in the same manner as it would be under 17 C.F.R. § 240.16a-1(a)(2) in determining whether a person has Beneficial Ownership of a Security for purposes of Section 16 of the 1934 Act and the rules and regulations thereunder.

8.10   Board

The “Board” means, with respect to a fund, the board of directors or trustees or any other group serving a similar function that has adopted this Code on behalf of the fund.

8.11   Code

“Code” means this Code of Ethics and any Associated Procedures.

8.12   Compliance Committee

“Compliance Committee” means the committee referenced under the Federated Code of Business Conduct and Ethics, consisting of, among others, the Chief Compliance Officer, the General Counsel, the Chief Audit Executive and the Chief Risk Officer.

8.13   Compliance Department

The “Compliance Department” means the Chief Compliance Officer of Federated and those other individuals designated by him or her as responsible for implementing this Code and the Associated Procedures.

8.14   Control

“Control” has the same meaning as that set forth in Section 2(a)(9) of the 1940 Act.

8.15   Covered Security

“Covered Security” means any Security, or interest in a Security held in any form, not expressly excluded by provisions of this Code, including, without limitation:  equity and debt Securities; derivative Securities, including, without limitation, options on and warrants to purchase equity or debt Securities; shares of closed-end investment companies; investments in unit investment trusts; and any related instruments and Securities.  “Covered Security” also means shares of any Reportable Funds and any 529 Plan or annuity employing such funds, unless specifically excluded in the paragraph below.  Also included are futures, swaps and other derivative contracts.

“Covered Security” does not include:  (1) direct obligations of the Government of the United States or U. S. Government Agencies (regardless of their maturities); (2) bankers' acceptances; bank certificates of deposit; commercial paper; high quality short-term debt instruments, including repurchase agreements; (3) shares of 1940 Act registered investment companies that are designated as money market funds; (4) shares issued by 1940 Act registered open-end investment companies (other than Reportable Funds) in a direct account with a mutual fund, or 529 Plan or annuity offeror when that account may only hold registered open-end investment company Securities; or (5) shares issued by unit investment trusts (or "UITs") that are invested exclusively in one or more open-end funds, none of which are Reportable Funds.

8.16   Federal Securities Laws

“Federal Securities Laws” means (a) the 1933 Act, (b) the 1934 Act, (c) the Sarbanes-Oxley Act of 2002, (d) the 1940 Act, (e) the Advisers Act, (f) Title V of the Gramm-Leach Bliley Act, (g) any rules of the SEC promulgated under any of the statutes identified in (a) through (f) above, (h) the Bank Secrecy Act as it applies to registered mutual funds and investment advisers, and (i) any rules adopted under the Bank Secrecy Act by the SEC or the Department of Treasury.

8.17   Federated

“Federated” means Federated Investors, Inc. and any of its subsidiaries as the context may require.

8.18   Fund

“Fund” means (i) each investment company registered under the 1940 Act (and any series or portfolios of such company) for which an Adviser serves as an investment adviser (as defined in § 2(a)(20) of the 1940 Act or an Underwriter serves as a principal underwriter (as defined in §§ 2(a)(29) and (40) of the 1940 Act) and (ii) any other investment account or portfolio over which an Adviser exercises investment discretion (whether pursuant to a direct advisory agreement, through a managed account or "wrap fee" program, or otherwise), and (iii) any investment adviser, broker, dealer, bank, or other financial institution to which Federated provides non-discretionary investment advisory services.

8.19   Independent Director

“Independent Director” means a member of the Federated Funds’ Board who is not an “interested person” of the Fund within the meaning of Section 2(a)(19) of the 1940 Act.

8.20   Influence

Influence means taking an action that is reasonably expected to materially modify the independent investment decision-making of a person who controls or otherwise has investment discretion with respect to an account (whether by imposing a restraint on such decision-making ability or directing a decision).

8.21   Initial Public Offering

“Initial Public Offering” means an offering of Securities registered under the 1933 Act, the issuer of which, immediately before the registration, was not subject to the reporting requirements of Sections 13 or 15(d) of the 1934 Act.

8.22   Investment Person; Investment Personnel

“Investment Person” or “Investment Personnel” means (a) Access Persons with direct responsibility and authority to make investment decisions affecting the Fund (such as portfolio managers and Chief Investment Officers) and individuals who provide information and advice to such portfolio managers (such as Securities analysts); and (b) those who assist in executing investment decisions for the Fund (such as traders) and their related staff members.

“Investment Person” or “Investment Personnel” further means any trust over which an Investment Person is a trustee with investment discretion, influence or control, (either for the benefit of the Investment Person or for any other party), any closely-held entity (such as a partnership, limited liability company or corporation) in which an Investment Person holds a Controlling interest and with respect to which he or she has investment influence or control, and any account (including, without limitation, any retirement, pension, deferred compensation or similar account) with respect to which the Access Person has investment discretion, influence or control.  Investment Person is intended to include and includes persons deemed to be Supervised Persons pursuant to Rule 204A-1 under the Investments Advisers Act of 1940, as further defined hereunder.

Activity (including, without limitation, trading activity) by an Investment Person’s household members will generally be attributed to the Investment Person.  (If emancipated adult children or other independent parties also reside in the household, the Investment Person must either declare that the Investment Person has no discretion, influence or control over the investment decisions of such other party or the Investment Person must report the party as an Investment Person.)

8.23   Private Placement

“Private Placement” (or “limited offering”) means an offering that is exempt from registration under the 1933 Act pursuant to Section 4(2) or Section 4(6) of the 1933 Act or pursuant to rule 504, rule 505 or rule 506 under the 1933 Act.

8.24   Purchase or Sale

“Purchase or Sale” of a Security or Covered Security includes, among other things, the writing of an option, future or other derivative contract to purchase or sell a Security or Covered Security.

8.25   Reportable Fund

“Reportable Fund” means any 1940-Act registered open end investment company for which an Adviser serves as investment adviser as defined in Section 2(a)(2) of the 1940 Act, or any 1940-Act registered investment company whose investment adviser or principal underwriter Controls an Adviser, is Controlled by an Adviser or is under common Control with an Adviser.

8.26   SEC

The “SEC” means the Securities and Exchange Commission of the United States, and any successor thereto.

8.27   Security

“Security” or "Securities" means any security as defined in Section 2(a)(36) of the 1940 Act or Section 202(a)(18) of the Advisers Act.

8.28   Supervised Person

"Supervised Person" means directors, officers and partners of an Adviser (or other persons occupying a similar status or performing similar functions), employees of an Adviser, and any other person who provides advice on behalf of an Adviser and is subject to the Adviser’s supervision and control.

8.29   Underwriter

“Underwriter” means any subsidiary of Federated registered as a broker/dealer with the SEC.

8.30   Vendor

"Vendor" means any borrower, lender, tenant, landlord, supplier, service provider (including, without limitation, a service provider to a mutual fund) or other vendor of Federated (including, without limitation, any Adviser or any other affiliate), any managed account or "wrap fee" program sponsor or turn key platform provider, or any other third party that has or is seeking a relationship with Federated (including, without limitation, any Adviser or other affiliate).

 

1The SEC has interpreted "high quality short-term debt instruments" to mean any instrument having a maturity at issuance of less than 366 days and which is rated in one of the highest two rating categories by a Nationally Recognized Statistical Rating Organization, or which is unrated but is of comparable quality. Personal Investment Activities of Investment Company Personnel and Codes of Ethics of Investment Companies and Their Investment Advisers and Principal Underwriters, Investment Company Act Release No. 21341 (Sept. 8, 1995) [60 FR 47844 (Sept. 14, 1995)] (proposing amendments to rule 17j-1) at note 66.This definition is repeated in the footnotes to the adopting and proposing releases for the Adviser's Code of Ethics requirement under Rule 204A-1. 

Approved by:	John B. Fisher	Date:	1/14/2011
	President of the Advisory Companies
Approved by:	Brian P. Bouda	Date:	1/14/2011
	Compliance

Addendum

ACCESS PERSONS PROCEDURES

1 Preclearance Approval Using TradeComply

(a)   All Access Persons who wish to effect a personal Securities transaction, whether a purchase, sale, or other disposition, must preclear the Covered Security in TradeComply prior to engaging in the transaction.  Private Placement securities must be precleared directly through the Compliance Department.

(b)   When trading options, the Access Person must preclear the option and the underlying Security before entering into the option contract.

(c)   Based on established criteria, TradeComply determines whether the contemplated transaction should be permitted.  The primary criterion applied is whether the Covered Security is on the Federated Equity Restricted List or Open Order lists, or whether the Covered Security was traded by any of the Federated advised Funds (fund trade information is updated nightly in TradeComply).

(d)   Approval is either granted or denied immediately in TradeComply.

(e)   If approval is denied, the contemplated personal transaction in that Covered Security is prohibited until prior approval is subsequently granted upon request in TradeComply.

(f)   If approval is granted, the Access Person is free to effect the personal transaction in that Covered Security until the end of the next trading day only (subject to revocation as contemplated in Section 3.2 of this Code).  In this regard, open orders extending beyond the next trading day (good till cancel) must be resubmitted for approval in TradeComply to comply with this Code.

(g)   All trade requests and their dispositions are maintained in TradeComply and reviewed by the Compliance Department in conjunction with other information provided by Access Persons in accordance with this Code.

(h)   The Compliance Department reviews all potential violations identified by TradeComply after Fund trades and personal trades have been compared and determines the appropriate action to be taken to resolve each identified violation.

2   Federated Funds Compliance Review

Access Persons must provide all relevant information concerning investments in Federated funds held in accounts with financial institutions or intermediaries (banks, broker-dealers, etc.) to the Compliance Department in the same manner and subject to the same timing requirements as individual Securities.

3   Non-U.S. Based Federated Access Persons

(a)       Access Persons who are not located in the U.S. must request preclearance approval from the Compliance Department via email.  Access Persons must provide specific trade details including the issuer name, anticipated date of transaction, full name of Security (i.e., title), description (i.e., type), CUSIP or SEDOL number or exchange ticker symbol, number of shares and principal amount, interest rate and maturity date (if applicable) and the type of transaction (purchase or sale).    The Compliance Department requests preclearance for the transaction through TradeComply during normal  business hours on the day the request is received.  The Compliance Department notifies the Access Person via email of the results of the preclearance request.

If the trade request is approved, the Access Person must execute the trade no later than the close of business on the business day following the date of the request (subject to revocation as contemplated in Section 3.2 of this Code).

4   Non-Federated Access Persons

(a) Transaction and holdings information of non-Federated officers of Federated and/or proprietary funds shall be reviewed on a quarterly basis to determine whether any patterns of conflict are exhibited with any Funds for which Federated has access to Fund transaction information, and

(b) Data relating to the trades of all personnel designated as Access Persons of a Fund for which Federated does not have access to Fund transaction information will be submitted to Compliance Department or other appropriate personnel of the Fund’s adviser for review on a quarterly basis.

COMPLIANCE DEPARTMENT PROCEDURES

1   Preclearance

(a)       Documentation of valid preclearance approval, including a statement that the Access Person was not aware of any consideration of a Security by research analysts or Fund portfolio managers for a recommendation, an actual Fund trade or an anticipated transaction, shall be conclusive for purposes of reviewing a personal transaction, unless additional facts or a preponderance of circumstances suggest otherwise.  This conclusive presumption does not apply to research analysts covering or recommending a Covered Security involved in a Fund trade or portfolio managers of a Fund making a trade in that Security.

(b)       Before approving a preclearance request for a Private Placement, submitted by an Access Person, the Compliance Department shall inquire of the appropriate portfolio manager(s) and head trader(s) as to whether an order is pending or expected to be entered for the same Security.  In cases where an Investment Person has submitted the request for preclearance, the Compliance Department shall also notify the Chief Investment Officer to whom the Investment Person reports.  The Compliance Department will notify the Access Person as to whether or not the investment has been precleared.

2   Initial Reporting Process

(a)      A member of the Compliance Department meets with each new Access Person and reviews this Code, the Insider Trading Policy and the procedures for preclearing personal Securities transactions through TradeComply.

(b)     The Access Person is required to complete the “Certification and Acknowledgment Form” to acknowledge his/her understanding of this Code and return it to the designated Compliance Assistant within ten (10) calendar days.

(c)      In addition, the Access Person is required to complete the “Personal Security Portfolio Forms” which includes information detailed in Section 2.1 of the Code, and:

NOTE:  Information provided by the Access Person must be current as of a date no more than 45 days before the report is submitted.  Failure to provide that information within 10 calendar days is deemed a violation of the Code and SEC Rules.

(d)   Separate forms must be completed for the Access Person and all household members as defined in Section 8.4 of this Code.  The signed form(s) must be returned to the Compliance Department within ten (10) calendar days.

(e)   A member of the Compliance Department inputs current portfolio holdings information into TradeComply as “initial” holdings.

(f)   The Compliance Department notifies each broker, dealer, bank or other financial institution that duplicate confirmations and statements for the Access Person and household members, if applicable, must be sent to the Chief Compliance Officer, effective immediately. The Compliance Department also will obtain reports on accounts held directly with Federated’s Transfer Agent and 401k Plan Administrator.

3   Quarterly Reporting Process

(a)   On the first business day after each calendar quarter end, the Compliance Assistant sends an e-mail to each Access Person giving step-by-step instructions on how to complete the quarterly reporting requirements using TradeComply.

(b)   By the date specified by the Compliance Department (but no later than thirty (30) calendar days of the quarter end), the Access Person is required to:

(i)   review for accuracy all Covered Security transactions recorded during the previous calendar quarter in all personal and household member accounts;

(ii)   review all open account information, including names of broker-dealers, banks and other financial institutions, addresses and account numbers;

(iii)   notify the Compliance Department of any new accounts established with broker-dealers, banks or other financial institutions during the quarter and the date the account was established;

(iv)   resolve any discrepancies with the Compliance Department;

(v)   record an electronic signature and date on TradeComply.

Information provided by the Access Person must be current as of a date no more than 45 days before the report is submitted.  Failure to provide that information within 10 calendar days is deemed a violation of the Code and SEC Rules.

The information required shall include the information detailed in Section 2.2 of the Code.

An Access Person need not submit a quarterly Securities transactions report to the extent that the report would duplicate information contained in broker trade confirmations or account statements delivered to Federated so long as such trade confirmations or account statements are received by the Compliance Department by the date specified by the Compliance Department (but in no later than 25 days after the end of the applicable calendar quarter).

(c)   Chief Compliance Officer Brian P. Bouda reviews potential violations of the Code by any Access Person periodically during the calendar quarter.

(d)   The Compliance Department issues memos to each Access Person involved if any personal transactions executed during the quarter appear to be violations of this Code.

(e)   Based on the facts and the Access Person’s response to the memo, the Chief Compliance Officer may impose or recommend any of the sanctions identified in Section 7 of this Code.

4   Annual Reporting Process

(a)   At least annually, the Compliance Department requires that each Access Person read this Code and certify and acknowledge his/her understanding of this Code and its requirements.

(b) In addition to the quarterly reporting requirements, on an annual basis, the Compliance Department requires each Access Person to confirm and certify that the records of all Covered Securities holdings in Trade Comply are complete and accurate.

This re-certification is required to be completed by the date specified by the Compliance Department (but in no event later than thirty (30) calendar days after a request) from the Compliance Department.  The Compliance Department monitors compliance with this requirement through the electronic signatures on TradeComply.

5   Reportable Funds Transactions

On a quarterly basis, the Compliance Department will request and review a report of Federated Fund Securities transactions by Access Persons and Investment Personnel from both the Federated Transfer Agent and the 401k Plan Administrator and from other accounts reported by Access Persons and Investment Personnel.  After reviewing these transactions, the Compliance Department will discuss any issues identified with the Access Person and management and take appropriate action, as provided by the Code.

6   Blackout Periods – Fund Trades

A transaction in a Covered Security by a Fund shall trigger a blackout period as specified above for Access Persons and Investment Persons, (other than the Portfolio Managers, Traders and Research Analysts serving a Fund in which such purchase or sale occurs), only if the aggregate of open orders and executed purchases and sales in the security within the Federated complex is equal to or exceeds a specified threshold on each trading day.  That threshold shall be defined by asset type, as follows:

Covered Security	Threshold equal to or greater than:
Equity	1% of the average daily volume measured over the preceding 20 trading days.
Fixed Income
Investment Grade
Corporate Obligation	$250,000
State or Foreign Obligation	$250,000
Municipal Obligation	$250,000
High Yield
Corporate Obligation	$100,000
State or Foreign Obligation	$100,000
Municipal Obligation	$100,000

An open order or executed trade in any equity Covered Security for which an average daily volume cannot be determined shall trigger a blackout period.  Any trades in any fixed income Covered Security not specified above shall trigger a blackout period.

7   Reporting to the Board of Directors

(a)   Each quarter, the Compliance Department will provide reports of any violations of this Code to Senior Management and the Board of Directors of the Federated Funds.  Any patterns or trends noted and any difficulties in administration of this Code shall be reported to Senior Management and, to the Board Directors of the Federated Funds, at least annually.

(b)   The Compliance Department will also report any difficulties in administration of this Code and any trends or patterns of personal Securities trading which are deemed by the Compliance Department to be violations of this Code.

(c)   The Compliance Department provides the Board with the job title of the Access Person; the type of violation; the details of the transaction(s); and the types of sanctions imposed, if any.

(d)      At least annually, the Compliance Department shall certify that the Fund, investment adviser or principal underwriter, as applicable, has adopted procedures reasonably necessary to prevent Access Persons from violating this Code.

8   Record Keeping Requirements

The Compliance Department maintains the following books and records in TradeComply for a period equal to (a) no less than six (6) calendar years or (b) any longer period that may be required under applicable law:

(a)   a copy of this Code (current and for the past five years)

(b)   a record of any violation of this Code and any action taken as a result of the violation;

(c)   a record of all written acknowledgments of access persons (current and for the past five years).

(d)   a record of each report made by an Access Person, including initial, quarterly and annual reporting (and including any information on a broker trade confirmation or account statement that was submitted in lieu of such reports);

(e)   a record of all Access Persons (current and for the past five years);

(f)   a record of any decision, and the reasons supporting the decision, to approve the acquisition of Securities by Access Persons in an Initial Public Offering (IPO) (to the extent approved as satisfying the limited exceptions in Sections 5.2(a) or (b) to the general prohibition) or Private Placement;

(g)   a record of persons responsible for reviewing reports; and

(h)   a copy of any supporting documentation used in making decisions regarding action taken by the Compliance Department with respect to personal Securities trading.

Such records will be kept in such locations, and for such periods, as required under the Advisers Act and the 1940 Act.

EX-99.CONSENT

Exhibit 28 (j) under Form N-1A

Exhibit 23 under Item 601/Reg. S-K

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the references to our firm under the caption “Financial Highlights” in the Prospectus and under the caption “Independent Registered Public Accounting Firm” in the Statement of Additional Information in Post-Effective Amendment Number 28 to the Registration Statement (Form N-1A, No. 33-41004) of Federated Intermediate Government Fund, Inc., and to the incorporation by reference of our report, dated April 25, 2011, on Federated Intermediate Government Fund, Inc. included in the Annual Report to Shareholders for the fiscal year ended February 28, 2011.

    /s/ ERNST & YOUNG LLP

Boston, Massachusetts

April 25, 2011