(front cover)
Investing in the Federated Family of FundsTM
Because The Best Of Life Awaits You
(front cover graphic)
The graphic consists of a circle centered in the middle of the page. The
circle contains nine smaller squares that consist of pictures of children
with their families doing various activities such as walking in a field of
flowers or along the beach. The squares are arranged in three rows of
three within the circle, and arranged to form a large square; the outside
of the circle is trimmed in red, orange, green and purple.
(Federated Investors logo)
Table of Contents
Before You Begin 2
Your Investment Strategy 3
Finding Your Balance Between Risk And Reward 4
Allocating Your Assets 5
Federated Family of Funds
Tax-Free Income Funds 6
Income Funds 6
Growth & Income Funds 7
Growth Funds 7
The Mutual Fund Experts Behind Your Investment
About Federated Investors 8,9
To Learn More 9
Mutual funds are not deposits or obligations of any bank, are not
guaranteed by any bank, and are not insured or guaranteed by the FDIC, the
Federal Reserve Board or any other government agency. Investment in mutual
funds involves risk, including possible loss of principal.
BEFORE YOU BEGIN-
KNOW YOUR INVESTMENT CHOICES
HOW TO PROPERLY INVEST YOUR MONEY IS A SERIOUS DECISION WITH LONT-TERM
CONSEQUENCES FOR YOU AND YOUR FAMILY. At risk may be the goals you've set,
your day-to-day financial responsibilities, and your future security. Here
are some steps you can take to help ensure a successful investing
experience:
(1) determine and prioritize your objectives, (2) evaluate your tolerance
for and ability to accept investment risks, (3) put into place a solid
financial strategy, using a combination of appropriate investments and (4)
continually monitor and assess your investment mix, as your goals and the
markets change.
The world of investing is intriguing, yet riddled with baffling choices.
For example, there are now nearly 6,000 mutual funds from which to choose.*
If you don't have the resources, time, or knowledge to uncover your best
opportunities, you may want to enlist the guidance of a professional
investment adviser. Your professional can help narrow the focus to those
investments that offer you the greatest potential, at the right time, for
your situation.
In today's electronic, global marketplace, there is little room for
ignorance. Investment risks are many, but the rewards can be vast and
exhilarating. One of the best assets you can begin with is a thorough
understanding of your investment choices.
*Source: Investment Company Institute
Life Is Filled With Surprises -
YOU NEED A POWERFUL INVESTMENT STRATEGY.
OBLIGATIONS AND RESPONSIBILITIES - EACH OF US FACES THEM. HOPES AND DREAMS
- - EACH OF US WANTS TO ACHIEVE THEM. But to do so we must meet and overcome
many financial challenges throughout our lives. No matter what your age or
situation, there are many compelling reasons to invest: retirement
security, the childrens' college education, sheltering income from taxes -
to name just a few.
And the fact is, a savings plan alone is simply no longer enough. We've
come light-years beyond the days of controlled interest rates, when the
value of currency was backed by gold and silver reserves. Tuitions are
skyrocketing, pensions are shrinking (or disappearing altogether), Social
Security is uncertain, and inflation is forever taking its toll. It's up to
you to keep pace. To help preserve and enhance the value of your money, you
need a powerful investment strategy.
Chances are you are investing for several different goals: immediate and
long-term, income and growth. That's why you'll need a combination of
investments that work in strong accord. The Federated Family of Funds is
designed to do just that. With a broad selection of portfolios to suit
practically every investment need, you and your investment professional can
use the Federated Family of Funds to create a comprehensive investment plan
to help you fulfill today's needs and realize tomorrow's dreams.
(photgraphic images)
Three small photographic images appear on the bottom right of the page.
The largest of the three is rectangular in shape, and consists of a mother
rollerblading with her two children in a park. The other two images are of
children: one is an image of a child tying her shoe, and the other depicts
two children working at a personal computer.
Risk And Reward-
WHAT ARE YOU WILLING AND ABLE TO ACCEPT?
TO ANSWER THIS QUESTION THERE ARE SEVERAL FACTORS YOU WILL NEED TO EXAMINE.
What is your timeline for investing? What are your financial
responsibilities? What is your income? What is your desired return? What is
your comfort zone with investment risk? These are just a few of the
questions you'll want to consider.
Because they are highly diversified - spreading your investment dollars
among many different securities - mutual funds offer a degree of protection
against investment risks that you won't get from investing in individual
securities. Still, they do not guarantee against loss, and even mutual
funds envelop a broad scope of risk, from the extremely conservative to the
most aggressive.
(Risk/Reward pyramid graphic)
The pyramid is constructed of colored cubes, with red representing the top
two layers for the growth funds, followed by two green rows representing
the growth and income funds, and the bottom layer consisting of two rows,
the left half of which is orange and representing the tax-free funds, and
the right half of which is purple and representing income funds. The words
`Higher Risk/higher Reward Potential'' appear above the pyramid, and the
words `Lower Risk/Lower Reward Potential'' appear beneath the pyramid.
This diagram illustrates the elements of risk and reward as it pertains to
the four primary investment categories - Tax-Free Income Funds, Income
Funds, Growth & Income Funds, and Growth Funds. On the following pages,
each portfolio of the Federated Family of Funds is also classified under
these headings, and you can assess how they rank according to their
inherent investment risks.
(A vertical sidebar appears on the right side of the page. It is grey in
color, runs the length of the page and includes the following three
paragraphs regarding risk and return).
RISK/RETURN
One of the basic principles of investing is that the more return you seek,
the more risk you face. For example, conservative investors seeking income
while protecting their original investment are usually not comfortable
taking higher risk. At the same time, these investors should not expect
extraordinary returns.
Aggressive investors who want significant returns on their investment
should also be willing to accept greater risks. In the middle are balanced
investors, who are pursuing both income and growth through their
investments.
You can use the Federated Family of Funds to create the right investment
mix for you - to pursue the highest possible return for your acceptable
level of risk.
No Single Investment Can Do It All -
ALLOCATE YOUR ASSETS WISELY.
PROPORTIONING YOUR INVESTMENT DOLLARS AMONG THAT iRIGHT MIXi OF INVESTMENTS
IS CALLED ASSET ALLOCATION. With this proven technique you can use a
combination of mutual funds from all, or some of, the investment
categories. Asset allocation puts the power of entire markets to work for
you, every day.
Used by leading money managers nationwide, asset allocation is a process
that builds upon the particular benefits of each market sector. In effect,
you are adding another layer of diversification - spreading your investment
dollars among mutual fund types, which are themselves spread among
individual securities - to help reduce investment risks.
WHICH ASSET MIX IS RIGHT FOR YOU?
How to proportion your money among the appropriate funds within each
portfolio is a process that involves careful analysis of your goals and
objectives. To help explain the concept of asset allocation, however, here
some simplified examples:
THE FOLLOWING EXAMPLES ARE FOR ILLUSTRATIVE PURPOSES ONLY AND ARE NOT
INTENDED TO PROVIDE SPECIFIC INVESTMENT ADVICE.
(Graphic: Three pie charts - one for each type of sample portfolio,
growth, balanced, and income, - appears on the left side of the page).
GROWTH PORTFOLIO
60% Growth Funds (represented in red)
20% Growth & Income Funds (represented in green)
20% Income Funds (represented in purple)
FOR PEOPLE WHO SEEK HIGH, LONG-TERM APPRECIATION IN THE VALUE OF THEIR
INVESTMENT. PORTFOLIOS MAY CONSIST PRIMARILY OF STOCK FUNDS.
BALANCED PORTFOLIO
20% Growth Funds (represented in red)
50% Growth & Income Funds (represented in green)
30% Income Funds (represented in purple)
FOR PEOPLE WHO SEEK TO BALANCE THE RISKS AND REWARDS OF LONG-TERM STOCK
INVESTING WITH INCOME-PRODUCING SECURITIES. PORTFOLIOS MAY CONSIST OF A
STRATEGIC COMBINATION OF STOCK AND BOND FUNDS.
INCOME PORTFOLIO*
5% Growth Funds (represented in red)
20% Growth & Income Funds (represented in green)
75% Income Funds (represented in purple)
FOR PEOPLE WHO SEEK TO INCREASE THEIR LEVEL OF CURRENT INCOME OR TO
ACCUMULATE WEALTH OVER TIME, USING A MORE CONSERVATIVE MEANS THAN STOCK
INVESTMENTS. PORTFOLIOS CONSIST PRIMARILY OF CORPORATE AND/OR GOVERNMENT
BOND FUNDS.
*Depending upon your particular tax situation, you may want to include
investments in tax-free funds as part of the income portion of your
personal portfolio.
Federated Family of Funds
(Graphic matrix of Federated Family of Funds)
Four fund categories (based upon primary ivestment objectives) are listed
horizontally across the top margin of the next two pages (which are
contiguous) in the following order: Tax-Free Income, Income, Growth and
Income, and Growth. The fund types are listed in color coded boxes as
previously assigned in the pyramid graphic on page four of the brochure.
The three investment strategy types (i.e., aggressive, moderate, and
conservative) are listed vertically along the left side of the page in
blue-gray boxes. The names of some funds comprising the Federated Family
of Funds along with a brief description of the fund are located within this
matrix according to fund type and investment strategy. The funds and
related descriptions are disclosed below.
The Federated Family of Funds offers a variety of portfolios, both
internationally and domestically diversified, providing you with a world of
investment opportunities in the stock and bond markets.
As you can see, we've grouped the funds according to their primary
investment objectives: Tax-Free Income, Income, Growth & Income and Growth.
Within these categories, each fund is plotted along a spectrum of
risk/return potential, which may help you measure its investment trade-off.
As always, your investment professional is your best source of guidance
INVESTMENT STRATEGY-AGGRESSIVE/INCOME
FEDERATED STRATEGIC INCOME FUND 1,2
Investing across three bond markets - domestic high-yield corporates,
international debt, and U.S. government securities - this fund seeks a high
level of income and strategically manages the risk inherent in high yield
and international bonds through sector diversification.
FEDERATED HIGH INCOME BOND FUND, INC. 2
The Federated High Income Bond Fund takes advantage of higher-yielding,
lower-rated corporate bonds as its primary means of pursuing high current
income.
GROWTH&INCOME
FEDERATED AMERICAN LEADERS FUND, INC.
By investing in blue-chip stocks of America's premier corporations,
American Leaders seeks growth of capital and income. The fund emphasizes
high-quality stocks with a value-based approach to security selections.
FEDERATED EQUITY INCOME FUND, INC.
This fund focuses on high-quality core holdings of domestic stocks for
above-average dividend yield potential and growth potential. Its goal is
above-average income and capital appreciation.
GROWTH
FEDERATED LATIN AMERICAN GROWTH FUND 1
The fund invests in long-term growth opportunities found primarily in the
region's more developed countries like Mexico, Brazil, Argentina, Peru,
Chile, Columbia, and Venezuela. It is always diversified across at least
three countries and selects stocks that exhibit superior potential for
price momentum.
FEDERATED EMERGING MARKETS FUND 1
With a current portfolio of over 150 different securities - broadly
diversified among 20 or more emerging market countries - this fund seeks
out long-term growth opportunities. Stocks from Africa, Latin America,
Asia, and parts of Europe are such smaller, developing markets the fund
attempts to profit from.
FEDERATED ASIA PACIFIC GROWTH FUND 1
With stock exposure in Asian and Pacific Rim countries, such as Japan,
India, China, Australia, Hong Kong, and Malaysia, this fund offers long-
term growth potential. It is always diversified across at least three
countries and selects stocks that exhibit superior potential for price
momentum.
FEDERATED EUROPEAN GROWTH FUND 1
In order to capture the abundant growth opportunities available in the
European stock market, this fund targets the more established countries of
Western Europe, but may also invest in the developing countries of Eastern
Europe.
FEDERATED INTERNATIONAL SMALL COMPANY FUND 1
This fund gives you both developed and emerging market diversification to
pursue long-term growth of capital. It invests in the small capitalization
stocks of companies based in the Far East, Latin America and Eastern
Europe, as well as the developed economies of Canada, Japan, and Western
Europe.
FEDERATED INTERNATIONAL EQUITY FUND 1
Utilizing foreign stocks of approximately 25 countries, this fund is
broadly diversified across many developed markets and in many industries.
Federated International Equity Fund may be a prudent way for investors who
seek total return on their assets to `put a toe in the water''
internationally.
FEDERATED SMALL CAP STRATEGIES FUND
Among Federated's more aggressive, domestic stock portfolios, this fund
seeks capital appreciation through a strategic selection of small
capitalization stocks, spread broadly among different industries.
FEDERATED GROWTH STRATEGIES FUND
Federated Growth Strategies Fund may be a good choice for long-term
investors who are striving to keep well ahead of inflation. It invests in a
portfolio of mid- to large-cap stocks that Federated believes offer
prospects for superior price momentum and earnings growth.
FEDERATED CAPITAL APPRECIATION FUND
In pursuit of capital appreciation, the fund invests primarily in a
strategic combination of mid- to large-cap stocks, which include those of
widely traded larger companies and mid-size, well-established firms.
INVESTMENT STRATEGY-MODERATE/TAX-FREE INCOME
FEDERATED MUNICIPAL OPPORTUNITIES FUND, INC. 4
A selection of investment-grade and higher-yielding, lower-rated municipal
bonds with a current average maturity of 13 years. The fund seeks a high
level of federally tax-free income, for the longer-term, tax-sensitive
investor.
FEDERATED STATE-SPECIFIC TAX-FREE FUNDS 4
These Federated funds offer residents of their respective states income
that is free from federal, state, and local taxes, where applicable:
Federated California Municipal Income Fund, Federated Michigan Intermediate
Municipal Trust, Federated New York Municipal Income Fund, Federated Ohio
Municipal Income Fund, and Federated Pennsylvania Municipal Income Fund.
FEDERATED MUNICIPAL SECURITIES FUND, INC. 4
To pursue high tax-free income each month for the mid- to long-term
investor, the fund invests in a diversified portfolio of investment-grade
quality municipal bonds.
INCOME
FEDERATED BOND FUND 2
Balancing its dual goals of current income and capital preservation,
Federated Bond Fund concentrates its holdings primarily in investment grade
bonds. To increase income potential, the fund may prudently invest up to
35% of its assets in higher yielding, lower-rated corporate bonds.
FEDERATED INTERNATIONAL INCOME FUND 1
Seeking a high level of current income, the fund invests primarily in
quality bonds from developed countries abroad. Its secondary objective is
capital appreciation.
FEDERATED GOVERNMENT INCOME SECURITIES FUND 3
For enhanced current income and high credit quality, the fund invests
chiefly in securities that are guaranteed by the U.S. government, its
agencies, and instrumentalities.
FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES, INC. 3
U.S. Treasury notes and bonds are used in conjunction with U.S. government
mortgage and other agency securities to provide current income. Its
managers seek to enhance returns while reducing price volatility.
GROWTH & INCOME
FEDERATED WORLD UTILITY FUND 1
As a more conservative `first step'' into global investing, the Federated
World Utility Fund is diversified, by security type and country, among
domestic and foreign utility securities. Total return, combining the
strengths of growth and income, is its aim.
FEDERATED UTILITY FUND, INC.
For current income and potential long-term growth of income, stocks and
bonds from diverse companies in the electric, gas, and communications
industries comprise the majority of this fund's holdings. Secondary
investments in convertible securities and adjustable rate preferreds are
used to help lower the interest-rate risk inherent in utility stocks.
INVESTMENT STRATEGY-CONSERVATIVE/TAX-FREE INCOME
FEDERATED LIMITED TERM MUNICIPAL FUND 4
Selecting quality municipal securities and targeting an average maturity of
3 years or less, the fund offers a moderately low-risk approach to tax-free
income and a low level of principal volatility.
TAX-FREE INSTRUMENTS TRUST 4,5
Investing in a diversified portfolio of tax-free money market securities,
this money market funds seeks to offer a high level of stability - plus
current income exempt from federal income tax.
INCOME
FEDERATED LIMITED TERM FUND
With primary investments across a wide spectrum of short-term, investment-
grade securities, the fund offers a moderately low-risk approach to
the pursuit of high current income. In an effort to capture the best short-
term risk/reward trade-off, the fund targets an average duration of 3 years
or less.
FEDERATED ADJUSTABLE RATE U.S. GOVERNMENT FUND, INC. 3
Due to the high quality and relative safety of the government securities in
which it invests, this fund provides the opportunity for current income at
a low risk expense. Adjustable rate mortgage securities, with targeted
durations between 1 and 1-1/2 years help to reduce principal fluctuations.
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST 3,4
Investing primarily in short-term U.S. government securities - guaranteed
by the U.S. government, its agencies or instrumentalities - this fund
offers exceptional quality for the stability-conscious.
MONEY MARKET MANAGEMENT, INC. 4
This money market fund offers the highest level of stability from a mutual
fund. It seeks income opportunities through short-term, high quality money
market securities.
(footnotes)
1 International securities entail more risk than U.S. securities due to
increased volatility, currency fluctuations, and differences in auditing
and other financial standards.
2 In return for their higher yields, lower-quality bonds carry a higher
risk of default and volatility.
3 The U.S. government-backing of individual securities does not protect
your fund shares or your principal from fluctuations in value. It does
guarantee the timely payment of principal and interest on the individual
government- or agency-backed holdings within the fund's portfolio.
4 If the federal alternative minimum tax applies to you, a portion of these
funds' distributions may be subject to such taxation. State and local taxes
are applicable to all but the state-specific, tax-free funds.
5If the federal alternative minimum tax applies to you, a portion of these
funds' distributions may be subject to such taxation. State and local taxes
are applicable to all but the state-specific, tax-free funds.
Federated Investors-
THE MUTUAL FUND EXPERTS BEHIND YOUR INVESTMENT
o Founded: 1955
o One of the 10 largest mutual fund managers in the country*
o Assets over $85 billion
o Funds: 240
o Employees: 1,800
o Average experience of senior investment professionals: 28 years
o Trading volume: approximately $4 trillion
(nearly the size of the national debt)
o In the top 8% of all 444 equity mutual fund managers,
based on assets under management*
o In the top 4% of all fixed income mutual fund managers, based on assets
under management*
o Introduced the first government fund to invest in mortgage-backed
securities
o Introduced one of the first high yield bond funds in the industry
(currently manages over $1.4 billion in high yield corporate bonds)
o Over 30 years of experience in the selection of corporate bonds
o One of the largest managers of tax-free portfolios
o Introduced the first fully managed tax-free fund
o More than 200 New York Stock Exchange firms and 4,000 financial
institutions
use Federated funds
*Source: Strategic Insight
(Two photographic images appear on this page. One is in the upper mid-
section of the page, and depicts a man and woman working on a personal
computer; the other appears in the bottom left of the page and depicts a
blur of business suits and brief cases walking along a city street).
YOU CAN COUNT ON FEDERATED FOR INNOVATION,
EXPERTISE, AND SOUND METHODOLOGIES ...
THERE IS NO FACTORY, NO MACHINERY, NO INVENTORY. Federated is a business of
people - employing ingenuity, creativity, experience and a wealth of
knowledge - to serve the financial needs of investors like you.
The brainchild of John F. Donahue, Richard B. Fisher, and Thomas Donnelly,
Federated was founded in 1955, in a modest, street-front office in
Pittsburgh, Pennsylvania. The growth of Federated has paralleled the growth
of the mutual fund industry. Their popularity and their assets have soared,
predominantly in the past two decades.
Federated first emerged as a leader in the early 70s, when it developed the
Mutual Fund for Investing in U.S. Government Securities (now called the
Federated Fund for U.S. Government Securities, Inc.). This was the first
fund that offered American investors the opportunity to invest in a
portfolio of government securities.
Today, in its fifth decade of service, Federated is one of the largest
investment management firms in the nation, with approximately $85 billion
in assets, and more than 240 funds. The company continues to be a leader in
the creation of investment products, services, and support systems that
prove their value daily. Federated applies every resource to help position
its clients for investment success.
That's why you can rest assured with Federated Investors as your money
manager.
MILLIONS OF PEOPLE DO.
TO LEARN MORE ABOUT FEDERATED FAMILY OF FUNDS,
AND THE MANY SERVICES, ADDED CONVENIENCES, AND BENEFITS YOU'LL ENJOY,
CALL 1-800-245-4770.
WE CAN PROVIDE YOU WITH ADDITIONAL PROSPECTUSES THAT CONTAIN MORE COMPLETE
INFORMATION ON THE FUNDS. PLEASE READ THEM CAREFULLY BEFORE INVESTING.
(back cover)
THIS BROCHURE MUST BE ACCOMPANIED OR PRECEDED BY A PROSPECTUS FOR ONE OF
THE FEDERATED FUNDS.
(Federated Investors Logo)
Federated Securities Corp. is the distributor of the funds.
012888 (6/96)
TOTAL RETURNS
12/31/96 ANNUALIZED TOTAL RETURN PERCENTAGES WITHOUT THE SALES LOAD:
Inception 1 year 3 year 5 year 10 year Since
Date Inception
FEDERATED 2/69 19.39% 17.84% 15.35% 13.17% 10.75%
AMERICAN LEADERS
FUND
Total return shown is for the Class A Shares and does not reflect the
maximum 5.5% sales charge. The total returns including maximum sales
charges for one, three, five, ten years and since inception would have
been: 12.80%, 15.65%, 14.05%, 12.52% and 10.53% respectively.
Inception 1 year 3 year 5 year 10 year Since
Date inception
FEDERATED BOND 6/95 5.21% na na na 8.42%
FUND -- A
FEDERATED BOND 5/87 5.40% 6.97% 10.54% na 9.91%
FUND --F
Although the William Penn Quality Income Fund is expected to be merged
into Class A Shares of Federated Bond Fund, performance is also shown for
the Class F Shares to demonstrate the long term performance of the
portfolio. Performance of the Class F Shares differs from that of the Class
A Shares due to differences in charges and expenses.
The above performance does not reflect the Class A Shares' maximum 4.5%
sales charge or the Class F Shares' maximum 1% sales charge or 1%
contingent deferred sales charge applicable to shares redeemed within four
years of purchase. The total returns including maximum sales charges for
one, three, five, ten years and since inception would have been: Federated
Bond Fund -A: .47%, na, na, na and 5.19% respectively; and Federated Bond
Fund - F: 3.28%, 6.25% 10.32%, na and 9.80% respectively. Expenses for
Federated Bond Fund were 1.05% for A and 1.08% for F as of 2/28/97.
Inception 1 year 3 year 5 year 10 year Since
Date inception
FEDERATED FUND 10/69 4.20% 5.34% 5.25% 7.51% 7.76%
FOR US
GOVERNMENT
SECURITIES
Total return shown is for the Class A Shares and does not reflect the
maximum 4.5% sales charge. The total returns including maximum sales
charges for one, three, five, ten years and since inception would have
been: (.53)%, 3.73%, 4.28%, 7.01% and 7.58% respectively.
Inception 1 year 3 year 5 year 10 year Since
Date inception
FEDERATED 8/84 5.76% 4.22% 6.94% 6.37% 13.07%
INTERNATIONAL
EQUITY FUND
Total return shown is for the Class A Shares and does not reflect the
maximum 5.5% sales charge. The total returns including maximum sales
charges for one, three, five, ten years and since inception would have
been: (.06)%, 2.27%, 5.74%, 5.76% and 12.55% respectively.
Inception 1 year 3 year 5 year 10 year Since
Date inception
FEDERATED 10/90 6.01% 5.30% 7.43% na 8.41%
PENNSYLVANIA
MUNI INCOME FUND
Total return shown is for the Class A Shares and does not reflect the
maximum 4.5% sales charge. The total returns including maximum sales
charges for one, three, five, ten years and since inception would have
been: 1.28%, 3.70%, 6.45%, na and 7.61%.
Inceptio 1 year 3 year 5 10 year Since
n Date year inception
FEDERATED NEW 12/92 4.92% 4.12% na na 6.89%
YORK MUNI INCOME
FUND
Total return shown is for the Class F Shares and does not reflect the
maximum sales charge. The maximum sales charge for Federated New York
Municipal Income Fund is 1.00%. The total returns including maximum sales
charges for one, three, five, ten years and since inception would have
been: 2.84%, 3.45%, na, na and 6.63% respectively. Federated New York
Municipal Income Fund also imposes a contingent deferred sales charge of 1%
on shares redeemed within four years of purchase.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate, so when shares are redeemed, they may be
worth more or less than their original cost.
015708(4/97)
FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES, INC.
Federated Investors
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
(412) 288-1900
April 8, 1997
EDGAR Operations Branch
Securities and Exchange Commission
Division of Investment Management
450 Fifth Street, N.W.
Washington, DC 20549
RE: Federated Fund For U.S. Government Securities, Inc. (the ``Fund'')
1933 Act File No. 333-23805
1940 Act File No. 811-1890
Dear Sir or Madam:
Pursuant to Regulation 14a-6 of the Securities Exchange Act of 1934,
enclosed for filing electronically are additional proxy solicitation
materials for the above-referenced Fund.
The enclosed information is expected to be mailed to certain
shareholders of U.S. Government Securities Income Portfolio, a portfolio of
William Penn Interest Income Fund, on or about April 25, 1997 in connection
with the Special Meeting of Shareholders to be held on May 29, 1997. The
material is intended to supplement the definitive Prospectus/Proxy,
Statement of Additional Information, and form of proxy of the Fund as filed
with the Commission on March 24, 1997.
Any questions or comments with respect to this filing may be directed
to the undersigned at (412) 288-4827.
Very truly yours,
/s/ Jody L. Petras
Jody L. Petras
Senior Compliance Analyst
cc: Byron Bowman
Matthew Hardin
Enclosures
