FEDERATED U.S. GOVERNMENT SECURITIES FUND: 2-5 YEARS
Institutional Shares
Institutional Service Shares
- --------------------------------------------------------------------------------
Supplement to Prospectuses dated March 31, 1997
Effective September 1997, Joseph M. Balestrino is no longer a portfolio manager
for Federated U.S. Government Securities Fund: 2-5 Years. In the sub-section of
the prospectuses entitled "Adviser's Background," please delete the biography of
Joseph M. Balestrino in its entirety and replace it with the following:
"Robert J. Ostrowski has been the Trust's portfolio manager since September
1997. Mr. Ostrowski joined Federated in 1987 as an Investment Analyst and
has been a Senior Vice President of the Trust's adviser since September
1997. Mr. Ostrowski served as a Vice President of the Trust's adviser from
1993 to 1997, and as an Assistant Vice President from 1992 to 1993. Mr.
Ostrowski is a Chartered Financial Analyst. He received his M.S. in
Industrial Administration from Carnegie Mellon University."
Susan M. Nason remains as a portfolio manager of the Trust.
[GRAPHIC OMITTED]
Cusip 31428P103, 31428P202
G01517-02(9/97)
[GRAPHIC OMITTED]
September 29, 1997
