MONEY MARKET TRUST /PA, 485BPOS, 1999-09-29

MONEY MARKET TRUST /PA
485BPOS, 1999-09-29

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1933 Act File No. 2-62285
1940 Act File No. 811-2550

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
------

Pre-Effective Amendment No. .............................

Post-Effective Amendment No. _46__............................. X
------- ------

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X

Amendment No. _33_ .......................................... X
--------- ------

MONEY MARKET TRUST

(Exact Name of Registrant as Specified in Charter)

Federated Investors Funds

5800 Corporate Drive

Pittsburgh, Pennsylvania 15237-7000

(Address of Principal Executive Offices)

(412) 288-1900

(Registrant's Telephone Number)

John W. McGonigle, Esquire,

1001 Liberty Avenue

Federated Investors Tower,

Pittsburgh, Pennsylvania 15222-3779

(Name and Address of Agent for Service)

(Notices should be sent to the Agent for Service)

It is proposed that this filing will become effective:

immediately upon filing pursuant to paragraph (b)
X_ on SEPTEMBER 30, 1999 pursuant to paragraph (b)

60 days after filing pursuant to paragraph (a) (i) on pursuant to paragraph
(a) (i) 75 days after filing pursuant to paragraph (a)(ii) on
_________________ pursuant to paragraph (a)(ii) 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.

Copies to:

Matthew G. Maloney, Esquire
Dickstein, Shapiro & Morin, L.L.P.

2101 L Street, N.W.
Washington, D.C. 20037

PROSPECTUS

Money Market Trust

A money market mutual fund seeking stability of principal and current income
consistent with stability of principal by investing primarily in a portfolio of
high-quality fixed income securities maturing in 397 days or less.

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

SEPTEMBER 30, 1999

CONTENTS

Risk/Return Summary 1

What are the Fund's Fees and Expenses? 3

What are the Fund's Investment Strategies? 4

What are the Principal Securities in Which the

Fund Invests? 5

What are the Specific Risks of Investing in the Fund? 6

What Do Shares Cost? 7

How is the Fund Sold? 7

How to Purchase Shares 8

How to Redeem Shares 9

Account and Share Information 12

Who Manages the Fund? 13

Financial Information 14

Independent Auditors' Report 26

Risk/Return Summary

WHAT IS THE FUND'S INVESTMENT OBJECTIVE?

The Fund is a money market fund that seeks to maintain a stable net asset value
of $1.00 per share. The Fund's investment objective is stability of principal
and current income consistent with stability of principal. 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 prospectus.

WHAT ARE THE FUND'S MAIN INVESTMENT STRATEGIES?

WHAT ARE THE MAIN RISKS OF INVESTING IN THE FUND?

All mutual funds take investment risks. Therefore, even though the Fund is a
money market fund that seeks to maintain a stable net asset value, it is
possible to lose money by investing in the Fund. 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.

RISK/RETURN BAR CHART AND TABLE

[Graphic]

Historically, the Fund has maintained a constant $1.00 net asset value per
share. The bar chart shows the variability of the Fund's total returns on a
calendar year-end basis.

The Fund's shares are not sold subject to a sales charge (load). The total
returns displayed above are based upon net asset value.

The Fund's total return for the six-month period from January 1, 1999 to June
30, 1999 was 2.30%.

Within the periods shown in the Chart, the Fund's highest quarterly return was
2.36% (quarter ended June 30, 1989). Its lowest quarterly return was 0.70%
(quarter ended June 30, 1993).

AVERAGE ANNUAL TOTAL RETURN TABLE

The following table represents the Fund's Average Annual Total Returns for the
calendar periods ended December 31, 1998.

<TABLE>

CALENDAR PERIOD FUND
<S> <C>
1 Year 5.25%
5 Years 5.08%
10 Years 5.49%

</TABLE>

The Fund's 7-Day Net Yield as of December 31, 1998 was 4.90%. Investors may call
the Fund at 1-800-341-7400 to acquire the current 7-Day Net Yield.

Past performance does not necessarily predict future performance. This
information provides you with historical performance information so that you can
analyze whether the Fund's investment risks are balanced by its potential
returns.

What are the Fund's Fees and Expenses?

MONEY MARKET TRUST

FEES AND EXPENSES

This table describes the fees and expenses that you may pay if you buy and hold
Shares of the Fund.

<TABLE>

SHAREHOLDER FEES

<S> <C>
Fees Paid Directly From
Your Investment
Maximum Sales Charge
(Load) Imposed on
Purchases (as a percentage
of offering price) None
Maximum Deferred Sales
Charge (Load) (as a
percentage of original
purchase price or
redemption proceeds,
as applicable) None
Maximum Sales Charge
(Load) Imposed on
Reinvested Dividends (and
other Distributions)
(as a percentage of
offering price). None
Redemption Fee (as a
percentage of amount
redeemed, if applicable) None
Exchange Fee None

ANNUAL FUND OPERATING EXPENSES Expenses That are Deducted From Fund Assets (as a
percentage of average net assets)

Management Fee 1 0.40%
Distribution (12b-1) Fee None
Shareholder Services Fee 1 0.25%
Other Expenses 0.17%
Total Annual Fund
Operating Expenses 0.82%
Total Waivers of Fund
Expenses 0.36%
Total Actual Annual
Operating Expenses (after
waivers) 0.46%
1 Pursuant to the investment advisory contract, portions of the Management Fee and
the Shareholder Services Fee were waived. After these waivers, for the fiscal
year ended July 31, 1999, the Management Fee paid by the Fund was 0.24% and the
Shareholder Services Fee was 0.05%. Shareholders must approve any change to the
advisory contract's waiver provision.

</TABLE>

EXAMPLE

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

The Example assumes that you invest $10,000 in the Fund's Shares 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 Fund's Shares' operating expenses are BEFORE WAIVERS as shown in
the Table and remain the same. Although your actual costs may be higher or
lower, based on these assumptions your costs would be:

<TABLE>

<S> <C>
1 Year $ 84
3 Years $ 262
5 Years $ 455
10 Years $ 1,014

</TABLE>

What are the Fund's Investment Strategies?

The Fund invests in a portfolio of high-quality fixed income securities, issued
by banks, corporations and the U.S. government, maturing in 397 days or less.
The dollar-weighted average maturity of the Fund's portfolio will be 90 days or
less. The Fund's investment adviser (Adviser) actively manages the Fund's
portfolio, seeking to limit the credit risk taken by the Fund and select
investments with enhanced yields.

The Adviser performs a fundamental credit analysis to develop an approved list
of issuers and securities that meet the Adviser's standard for minimal credit
risk. The Adviser monitors the credit risks of all portfolio securities on an
ongoing basis by reviewing periodic financial data and ratings of nationally
recognized rating services.

The Adviser targets an average portfolio maturity based upon its interest rate
outlook. The Adviser formulates its interest rate outlook by analyzing a variety
of factors such as current and expected U.S. economic growth; current and
expected interest rates and inflation; and the Federal Reserve's monetary
policy. The Adviser structures the portfolio by investing primarily in variable
rate demand instruments and commercial paper. The Adviser generally shortens the
portfolio's maturity when it expects interest rates to rise and extends the
maturity when it expects interest rates to fall. This strategy seeks to enhance
the returns from favorable interest rate changes and reduce the effect of
unfavorable changes.

What are the Principal Securities in Which the Fund Invests?

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. The
following describes the types of fixed income securities in which the Fund
invests.

CORPORATE DEBT SECURITIES

Corporate debt securities are fixed income securities issued by businesses.
Notes, bonds, debentures and commercial paper are the most prevalent types of
corporate debt securities. The Fund may also purchase interests in bank loans to
companies.

COMMERCIAL PAPER

Commercial paper is an issuer's obligation with a maturity of less than nine
months. Companies typically issue commercial paper to pay for current
expenditures. Most issuers constantly reissue their commercial paper and use the
proceeds (or bank loans) to repay maturing paper. If the issuer cannot continue
to obtain liquidity in this fashion, its commercial paper may default.

DEMAND INSTRUMENTS

Demand instruments are corporate debt securities that the issuer must repay upon
demand. Other demand instruments require a third party, such as a dealer or
bank, to repurchase the security for its face value upon demand. The Fund treats
demand instruments as short-term securities, even though their stated maturity
may extend beyond one year.

BANK INSTRUMENTS

Bank instruments are unsecured interest bearing deposits with banks. Bank
instruments include bank accounts, time deposits, certificates of deposit and
banker's acceptances.

ASSET BACKED SECURITIES

Asset backed securities are payable from pools of obligations other than
mortgages. Most asset backed securities involve consumer or commercial debts
with maturities of less than 10 years. However, almost any type of fixed income
assets (including other fixed income securities) may be used to create an asset
backed security. Asset backed securities may take the form of commercial paper,
notes or pass through certificates.

CREDIT ENHANCEMENT

Credit enhancement consists of an arrangement in which a company agrees to pay
amounts due on a fixed income security if the issuer defaults. In some cases the
company providing credit enhancement makes all payments directly to the security
holders and receives reimbursement from the issuer. Normally, the credit
enhancer has greater financial resources and liquidity than the issuer. For this
reason, the Adviser usually evaluates the credit risk of a fixed income security
based solely upon its credit enhancement.

REPURCHASE AGREEMENTS

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. Repurchase agreements are subject
to credit risks.

INVESTMENT RATINGS

The securities in which the Fund invests must be rated in the highest short-term
rating category by one or more of the nationally recognized statistical rating
organizations or be of comparable quality to securities having such ratings.

What are the Specific Risks of Investing in the Fund?

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. Money market funds try to minimize this risk by purchasing
higher quality securities.

Many fixed income securities receive credit ratings from services such as
Standard & Poor's and Moody's Investor Services, Inc. These services assign
ratings to securities by assessing the likelihood of issuer default. Lower
credit ratings correspond to higher credit risk. If a security has not received
a rating, the Fund must rely entirely on the Adviser's credit assessment.

Credit risk includes the possibility that a party to a transaction involving the
Fund will fail to meet its obligations. This could cause the Fund to lose the
benefit of the transaction or prevent the Fund from selling or buying other
securities to implement its investment strategy.

INTEREST RATE RISKS

Prices of fixed income securities rise and fall in response to changes in the
interest rate 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 price 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 price of fixed income
securities with longer maturities. Money market funds try to minimize this risk
by purchasing short-term securities.

SECTOR RISKS

A substantial part of the Fund's portfolio may be comprised of securities credit
enhanced by banks or companies with similar characteristics. As a result, the
Fund will be more susceptible to any economic, business, political or other
developments which generally affect these entities.

What Do Shares Cost?

You can purchase or redeem Shares any day the New York Stock Exchange (NYSE) is
open. The Fund attempts to stabilize the net asset value (NAV) of its Shares at
$1.00 by valuing the portfolio securities using the amortized cost method. The
Fund cannot guarantee that its NAV will always remain at $1.00 per Share. The
Fund does not charge a front-end sales charge. NAV is determined at 12:00 noon
and 3:00 p.m. (Eastern time) and as of the end of regular trading (normally 4:00
p.m. Eastern time) each day the NYSE is open.

The required minimum initial investment for Fund Shares is $25,000. There is no
required minimum subsequent investment amount.

An account may be opened with a smaller amount as long as the $25,000 minimum is
reached within 90 days. An institutional investor's minimum investment is
calculated by combining all accounts it maintains with the Fund. Accounts
established through investment professionals may be subject to a smaller minimum
investment amount. Keep in mind that investment professionals may charge you
fees for their services in connection with your Share transactions.

How is the Fund Sold?

The Fund's Distributor, Federated Securities Corp., markets the Shares described
in this prospectus to institutional investors such as banks, fiduciaries,
custodians of public funds and similar institutional investors or individuals,
directly or through investment professionals.

The Distributor and its affiliates may pay out of their assets other
amounts (including items of material value) to investment professionals
for marketing and servicing Shares. The Distributor is a subsidiary of
Federated Investors, Inc. (Federated).

How to Purchase Shares

You may purchase Shares through an investment professional or directly from the
Fund. The Fund reserves the right to reject any request to purchase Shares.

THROUGH AN INVESTMENT PROFESSIONAL

* Establish an account with the investment professional; and

* Submit your purchase order to the investment professional before 3:00 p.m.
(Eastern time). You will receive that day's dividend if the investment
professional forwards the order to the Fund and the Fund receives payment by
3:00 p.m. (Eastern time). You will become the owner of Shares and receive
dividends when the Fund receives your payment.

Investment professionals should send payments according to the instructions in
the sections "By Wire" or "By Check."

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 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 the Fund or its transfer agent incurs.

An institution may establish an account and place an order by calling the Fund
and will become a shareholder after the Fund receives the order.

BY WIRE

Send your wire to:

State Street Bank and Trust Company

Boston, MA

Dollar Amount of Wire

ABA Number 011000028

Attention: 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 mail it to:

Federated Shareholder Services Company

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, mail it to:

Federated Shareholder Services Company

1099 Hingham Street

Rockland, MA 02370-3317

Payment should be made in U.S. dollars and drawn on a U.S. bank. The Fund
will not accept third-party checks (checks originally payable to someone
other than you or The Federated Funds).

Orders by mail are considered received when payment by check is converted into
federal funds (normally the business day after the check is received) and Shares
begin earning dividends the next day.

BY AUTOMATIC INVESTMENTS

You may establish an account with your financial institution to automatically
purchase Shares on pre-determined dates or when your bank account reaches a
certain level. Under this program, participating financial institutions are
responsible for prompt transmission of orders and may charge you for this
service. You should read this prospectus along with your financial institution's
agreement or materials describing this service.

BY AUTOMATED CLEARING HOUSE

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.

RETIREMENT INVESTMENTS

You may purchase Shares as retirement investments (such as qualified plans and
IRAs or transfer or rollover of assets). Call your investment professional or
the Fund for information on retirement investments. We suggest that you discuss
retirement investments with your tax adviser. You may be subject to an annual
IRA account fee.

How to Redeem Shares

You should redeem Shares:

* through an investment professional if you purchased Shares through an
investment professional; or

* directly from the Fund if you purchased Shares directly from the Fund.

THROUGH AN INVESTMENT PROFESSIONAL

Submit your redemption request to your investment professional by the end of
regular trading on the NYSE (normally 4:00 p.m. Eastern time). Investment
professionals are responsible for promptly submitting redemption requests and
providing proper written redemption instructions as outlined below.

DIRECTLY FROM THE FUND

BY TELEPHONE

You may redeem Shares by calling the Fund at 1-800-341-7400 once you have
completed the appropriate authorization form for telephone transactions.

If you call before 3:00 p.m. (Eastern time), your redemption will be wired to
you the same day. You will not receive that day's dividend.

If you call after 3:00 p.m. (Eastern time), your redemption will be wired to you
the following business day. You will receive that day's dividend.

BY MAIL

You may redeem Shares by mailing a written request to the Fund.

Your redemption request will be processed on the day the Fund receives your
written request in proper form. Dividends are paid up to and including the day
that a redemption request is processed.

Send requests by mail to:

Federated Shareholder Services Company

P.O. Box 8600

Boston, MA 02266-8600

Send requests by PRIVATE COURIER OR OVERNIGHT DELIVERY SERVICE to:

Federated Shareholder Services Company

1099 Hingham Street

Rockland, MA 02370-3317

All requests must include:

* Fund Name and Share Class, account number and account registration;

* amount to be redeemed;

* signatures of all shareholders exactly as registered.

Call your investment professional or the Fund if you need special instructions.

SIGNATURE GUARANTEES

Signatures must be guaranteed 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; or

* a redemption is payable to someone other than the shareholder(s) of
record.

A signature guarantee is designed to protect your account from fraud. Obtain a
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.

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 up to seven days:

* to allow your purchase to clear;

* during periods of market volatility; or

* when a shareholder's trade activity or amount adversely impacts the Fund's
ability to manage its assets.

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

REDEMPTIONS FROM RETIREMENT ACCOUNTS

In the absence of your specific instructions, 10% of the value of your
redemption from a retirement account in the Fund may be withheld for taxes. This
withholding only applies to certain types of retirement accounts.

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.

SHARE CERTIFICATES

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

Account and Share Information

ACCOUNT ACTIVITY

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.

The Fund does not expect to realize any capital gains or losses. If capital
gains or losses were to occur, they could result in an increase or decrease in
dividends. The Fund pays any capital gains at least annually. Your dividends and
capital gains distributions will be automatically reinvested in additional
Shares without a sales charge, unless you elect cash payments.

ACCOUNTS WITH LOW BALANCES

Due to the high cost of maintaining accounts with low balances, non- retirement
accounts may be closed if redemptions cause the account balance to fall below
the minimum initial investment amount. Before an account is closed, you will be
notified and allowed 30 days to purchase additional Shares to meet the minimum.

TAX INFORMATION

The Fund sends 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 as ordinary income; capital gains
are taxable at different rates depending upon the length of time the Fund holds
its assets.

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

Who Manages the Fund?

The Board of Trustees 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. The Adviser's address
is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, PA 15222-3779.

The Adviser and other subsidiaries of Federated advise approximately 175 mutual
funds and separate accounts, which totaled approximately $111 billion in assets
as of December 31, 1998. Federated was established in 1955 and is one of the
largest mutual fund investment managers in the United States with approximately
1,900 employees. More than 4,000 investment professionals make Federated Funds
available to their customers.

ADVISORY FEES

The Adviser receives an annual investment advisory fee of 0.40% of the Fund's
average daily net assets. Under the investment advisory contract, which is
subject to annual renewal by the Fund's Board of Trustees, the Adviser will
waive the amount, limited to the amount of the advisory fee, by which the Fund's
aggregate annual operating expenses, including the investment advisory fee but
excluding interest, taxes, brokerage commissions, expenses of registering or
qualifying the Fund and its shares under federal and state laws and regulations,
expenses of withholding taxes, and extraordinary expenses exceed 0.45% of its
average daily net assets.

YEAR 2000 READINESS

The "Year 2000" problem is the potential for computer errors or failures because
certain computer systems may be unable to interpret dates after December 31,
1999 or may experience other date-related problems. The Year 2000 problem may
cause systems to process information incorrectly and could disrupt businesses,
such as the Fund, that rely on computers.

While it is impossible to determine in advance all of the risks to the Fund, the
Fund could experience interruptions in basic financial and operational
functions. Fund shareholders could experience errors or disruptions in Fund
share transactions or Fund communications.

The Fund's service providers are making changes to their computer systems to fix
any Year 2000 problems. In addition, they are working to gather information from
third-party providers to determine their Year 2000 readiness.

Year 2000 problems would also increase the risks of the Fund's investments. To
assess the potential effect of the Year 2000 problem, the Adviser is reviewing
information regarding the Year 2000 readiness of issuers of securities the Fund
may purchase.

However, this may be difficult with certain issuers. For example, funds dealing
with foreign service providers or investing in foreign securities will have
difficulty determining the Year 2000 readiness of those entities. The financial
impact of these issues for the Fund is still being determined. There can be no
assurance that potential Year 2000 problems would not have a material adverse
effect on the Fund.

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.

This information has been audited by Deloitte & Touche LLP, whose report, along
with the Fund's audited financial statements, is included in this prospectus.

Financial Highlights

(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

Reference is made to the Independent Auditors' Report on page 26.

<TABLE>

YEAR ENDED JULY 31 1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
INCOME FROM INVESTMENT OPERATIONS:

Net investment income 0.05 0.05 0.05 0.05 0.05
LESS DISTRIBUTIONS:
Distributions from net investment income (0.05) (0.05) (0.05) (0.05) (0.05)
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
TOTAL RETURN 1 4.88% 5.35% 5.19% 5.31% 5.42%

RATIOS TO AVERAGE NET ASSETS:

Expenses 0.46% 0.46% 0.46% 0.46% 0.46%
Net Investment income 4.81% 5.24% 5.09% 5.22% 5.32%
SUPPLEMENTAL DATA:

Net assets, end of period (000 omitted) $380,400 $412,104 $464,012 $513,687 $507,272

</TABLE>

1 Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.

See Notes which are an integral part of the Financial Statements

Portfolio of Investments

JULY 31, 1999

<TABLE>

PRINCIPAL

AMOUNT VALUE
<C> <S> <C>

SHORT-TERM NOTES--11.8%

FINANCE - AUTOMOTIVE--3.7%

$ 2,614,190 Ford Credit Auto Owner
Trust 1999-B, Class A-1,

4.978%, 1/18/2000 $ 2,614,190
5,000,000 Ford Credit Auto Owner
Trust 1999-B, Class A-2,

5.114%, 5/15/2000 5,000,000

3,500,000 Honda Auto Lease Trust
1999-A, Class A-1, 5.445%,

8/15/2000 3,500,000

3,000,000 Toyota Auto Receivables
1999-A Owner Trust, Class

1, 5.365%, 8/11/2000 3,000,000
TOTAL 14,114,190

FINANCE - EQUIPMENT--6.6%

2,000,000 Caterpillar Financial
Asset Trust 1999-A, Class

1, 5.365%, 7/25/2000 2,000,000

19,046 Copelco Capital Funding
Trust 1998-A, Class A-1,

5.680%, 8/15/1999 19,046

13,538,056 Heller Equipment Asset
Receivables Trust 1999-1,
Class A-1, 4.947%,

5/13/2000 13,538,056

7,214,507 Navistar Financial 1999-A
Owner Trust, Class A-1,

5.002%, 6/15/2000 7,214,507

2,078,979 Newcourt Equipment Trust
Securities 1998-1, Class

A-1, 5.007%, 11/20/1999 2,079,134
TOTAL 24,850,743

INSURANCE--1.5%

190,037 Americredit Automobile
Receivables Trust 1998-D,
Class A-1, (Insured by

FSA), 5.199%, 11/12/1999 190,037

1,800,448 Americredit Automobile
Receivables Trust 1999-A,
Class A-1, (Insured by

FSA), 4.980%, 3/12/2000 1,800,448

3,212,492 First Sierra Equipment
Contract Trust 1998-1,
Class A-1, (Insured by MBIA
Insurance Corp.), 5.215%,

1/12/2000 3,214,572

565,444 WFS Financial 1998-C Owner Trust, Class A-1, (Insured by FSA),
5.395%,

11/20/1999 565,444
TOTAL 5,770,501
TOTAL SHORT-TERM NOTES 44,735,434
CERTIFICATES OF DEPOSIT--
6.0%
BANKING--6.0%

15,000,000 First National Bank of MD,
5.020%, 1/25/2000 14,997,895
8,000,000 Nationsbank, N.A.,
Charlotte, 5.180%,

2/1/2000 8,000,000

TOTAL CERTIFICATES OF

DEPOSIT 22,997,895
<CAPTION>

PRINCIPAL

AMOUNT VALUE
<C> <S> <C>

COMMERCIAL PAPER--41.1% 1
BANKING--30.5%

$ 18,000,000 Asset Securitization
Cooperative Corp., 5.100%
- 5.110%, 8/25/1999 -

9/10/1999 $ 17,916,080
6,375,000 Benedictine Health System,
(Lasalle National Bank,
Chicago LOC), 5.120%,

9/7/1999 6,341,453

18,200,000 Falcon Asset
Securitization Corp.,
5.110%, 8/19/1999 -

8/23/1999 18,146,175

18,234,000 Fountain Square Commercial
Funding Corp., (Fifth
Third Bank, Cincinnati
Support Agreement), 4.930%
- 5.470%, 8/23/1999 -

1/18/2000 17,997,680

18,000,000 PREFCO-Preferred Receivables Funding Co., 4.930% - 5.120%,
8/3/1999 -

8/25/1999 17,973,287
6,404,000 Receivables Capital Corp.,
5.120%, 9/7/1999 6,370,301

13,000,000 Three Rivers Funding
Corp., 5.120%, 8/18/1999 -

8/20/1999 12,967,147
18,223,000 Wood Street Funding Corp.,
4.890% - 5.110%, 8/13/1999
- 8/26/1999 18,178,626
TOTAL 115,890,749

FINANCE - AUTOMOTIVE--2.4%

9,400,000 General Motors Acceptance
Corp., 5.250% - 5.360%,

1/26/2000 - 3/6/2000 9,124,727
FINANCE - COMMERCIAL--5.4%

21,000,000 General Electric Capital
Corp., 4.830% - 4.950%,

8/9/1999 - 2/4/2000 20,760,678
FINANCE - RETAIL--2.0%

8,000,000 Associates First Capital

Corp., 5.450%, 1/24/2000 7,786,845
INSURANCE--0.8%

3,000,000 Marsh USA Inc., 5.520%,

1/28/2000 2,917,200
TOTAL COMMERCIAL PAPER 156,480,199

LOAN PARTICIPATION--7.9%
BROKERAGE--2.6%

10,000,000 Goldman Sachs Group, Inc.,
5.022%, 8/2/1999 10,000,000
FINANCE - AUTOMOTIVE--1.3%
5,000,000 General Motors Acceptance
Corp., Mortgage of PA,
(Guaranteed by General
Motors Acceptance Corp.),

5.220%, 8/2/1999 5,000,000

FINANCE - EQUIPMENT--4.0%
15,000,000 Pitney Bowes Credit Corp.,

5.180%, 8/10/1999 14,980,575
TOTAL LOAN PARTICIPATION 29,980,575

MUNICIPALS--1.8%

6,800,000 Bergen County, NJ
Improvement Authority,
Bergen Regional Medical
Center Project (Series
1999-A), (Guaranteed by
Bergen County, NJ
Improvement Authority),
5.330%, 3/16/2000 6,800,000
<CAPTION>

PRINCIPAL

AMOUNT VALUE
<C> <S> <C>

VARIABLE RATE OBLIGATIONS--
23.1% 2

BANKING--8.8%
$ 3,740,000 500 South Front St. LP,

Series A, (Huntington
National Bank, Columbus,

OH LOC), 5.270%, 8/5/1999 $ 3,740,000

3,800,000 Barker Property Management LLC, (Series 1998), (Wachovia Bank
of NC, N.A., Winston-Salem LOC),

5.180%, 8/4/1999 3,800,000

6,000,000 Economic Development
Partnership of Alabama,
Inc., Series 1998,
(Amsouth Bank N.A.,
Birmingham LOC), 5.310%,

8/5/1999 6,000,000

4,390,000 Historical Preservation
Authority of Birmingham,
(Series 1993), (Amsouth
Bank N.A., Birmingham

LOC), 5.270%, 8/5/1999 4,390,000
2,450,000 Scranton Times LP, (PNC
Bank, N.A. LOC), 5.163%,

8/2/1999 2,450,000

4,580,000 Scranton Times LP, Series
1997, (PNC Bank, N.A. LOC),

5.163%, 8/2/1999 4,580,000

5,990,000 Westminster Village Terre
Haute, Inc., (Huntington
National Bank, Columbus,

OH LOC), 5.270%, 8/5/1999 5,990,000
2,500,000 Wildcat Management Co.,
Inc., (Series 1999),
(Firstar Bank, N.A.,
Cincinnati LOC), 5.230%,

8/5/1999 2,500,000
TOTAL 33,450,000

BROKERAGE--2.4%

4,600,000 Morgan Stanley, Dean
Witter & Co., 5.320%,

2/4/2000 4,600,000

4,600,000 Morgan Stanley, Dean
Witter & Co., 5.370%,

2/4/2000 4,600,000
TOTAL 9,200,000

ELECTRICAL EQUIPMENT--1.0%

3,700,000 Alabama State IDA, General
Electric Project, (General
Electric Co. LOC), 5.170%,

8/5/1999 3,700,000

FINANCE - AUTOMOTIVE--1.2%

4,600,000 General Motors Acceptance

Corp., 5.320%, 3/7/2000 4,600,000

FINANCE - RETAIL--0.5%

2,000,000 Bishop's Gate Residential Mortgage Trust 1998-2, Class A-1,
5.420%,

8/10/1999 2,000,000
INSURANCE--9.2%

2,000,000 Allstate Life Insurance

Co., 5.075%, 8/1/1999 2,000,000
2,000,000 Allstate Life Insurance
Co., 5.370%, 8/1/1999 2,000,000
10,000,000 General American Life
Insurance Co., 5.370%,

8/23/1999 10,000,000

3,000,000 Jackson National Life
Insurance Co., 5.120%,

8/23/1999 3,000,000

18,000,000 People Security Life
Insurance Co., 5.390%,

8/2/1999 18,000,000
TOTAL 35,000,000

TOTAL VARIABLE RATE

OBLIGATIONS 87,950,000
<CAPTION>

PRINCIPAL

AMOUNT VALUE
<C> <S> <C>

REPURCHASE AGREEMENTS--7.1%
3

$ 10,000,000 Bank of America, 5.130%,
dated 7/30/1999, due

8/2/1999 $ 10,000,000
17,000,000 Bear, Stearns and Co.,
5.130%, dated 7/30/1999,

due 8/2/1999 17,000,000

TOTAL REPURCHASE

AGREEMENTS 27,000,000
TOTAL INVESTMENTS (AT
AMORTIZED COST) 4 $ 375,944,103

</TABLE>

1 Each issue shows the rate of discount at the time of purchase for discount
issues, or the coupon for interest bearing issues.

2 Current rate and next reset date shown.

3 The repurchase agreements are collateralized fully by U.S. Treasury or
government agency obligations based on market prices at the date of the
purchase. The investments in the repurchase agreements are through participation
in joint accounts with other Federated funds.

4 Also represents cost for federal tax purposes.

Note: The categories of investments are shown as a percentage of net assets
($380,400,408) as of July 31, 1999.

The following acronyms are used throughout this portfolio:

FSA --Financial Security Assurance
LLC --Limited Liability Corporation
LOC --Letter of Credit
MBIA --Municipal Bond Investors Assurance

See Notes which are an integral part of the Financial Statements

Statement of Assets and Liabilities

JULY 31, 1999

<TABLE>

<S> <C> <C>
ASSETS:
Investments in repurchase
agreements $ 27,000,000
Investments in securities 348,944,103
Total investments at
amortized cost and value $ 375,944,103
Cash 79,630
Income receivable 1,323,739
Receivable for shares sold 4,440,777
TOTAL ASSETS 381,788,249
LIABILITIES:

Payable for shares

redeemed 119,829
Income distribution
payable 1,167,834
Accrued expenses 100,178
TOTAL LIABILITIES 1,387,841
Net assets for 380,400,408
shares outstanding $ 380,400,408
NET ASSET VALUE, OFFERING
PRICE AND REDEMPTION
PROCEEDS PER SHARE:
$380,400,408 / 380,400,408

shares outstanding $1.00

</TABLE>

See Notes which are an integral part of the Financial Statements

Statement of Operations

YEAR ENDED JULY 31, 1999

<TABLE>

<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 23,221,355
EXPENSES:

Investment advisory fee $ 1,762,698
Administrative personnel
and services fee 332,269
Custodian fees 36,737
Transfer and dividend
disbursing agent fees and
expenses 139,294
Directors'/Trustees' fees 13,268
Auditing fees 13,044
Legal fees 4,817
Portfolio accounting fees 88,816
Shareholder services fee 1,101,686
Share registration costs 31,591
Printing and postage 23,654
Insurance premiums 47,554
Miscellaneous 7,023
TOTAL EXPENSES 3,602,451
WAIVERS:
Waiver of investment
advisory fee $ (706,475)
Waiver of shareholder
services fee (881,349)
TOTAL WAIVERS (1,587,824)
Net expenses 2,014,627
Net investment income $ 21,206,728

</TABLE>

See Notes which are an integral part of the Financial Statements

Statement of Changes in Net Assets

<TABLE>

YEAR ENDED JULY 31 1999 1998
<S> <C> <C>
INCREASE (DECREASE) IN NET

ASSETS
OPERATIONS:

Net investment income $ 21,206,728 $ 22,484,657
DISTRIBUTIONS TO

SHAREHOLDERS:

Distributions from net

investment income (21,206,728) (22,484,657)
SHARE TRANSACTIONS:
Proceeds from sale of
shares 2,231,199,677 2,195,189,173
Net asset value of shares
issued to shareholders in
payment of
distributions declared 3,706,698 3,867,601
Cost of shares redeemed (2,266,609,807) (2,250,964,853)
CHANGE IN NET ASSETS
RESULTING FROM SHARE

TRANSACTIONS (31,703,432) (51,908,079)
Change in net assets (31,703,432) (51,908,079)
NET ASSETS:

Beginning of period 412,103,840 464,011,919
End of period $ 380,400,408 $ 412,103,840

</TABLE>

See Notes which are an integral part of the Financial Statements

Notes to Financial Statements

JULY 31, 1999

ORGANIZATION

Money Market Trust (the "Fund") is registered under the Investment Company Act
of 1940, as amended (the "Act"), as an open-end management investment company.
The investment objective of the Fund is stability of principal and current
income consistent with stability of principal.

SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.

INVESTMENT VALUATIONS

The Fund's use the amortized cost method to value its portfolio securities is in
accordance with Rule 2a-7 under the Act.

REPURCHASE AGREEMENTS

It is the policy of the Fund to require the custodian bank to take possession,
to have legally segregated in the Federal Reserve Book Entry System, or to have
segregated within the custodian bank's vault, all securities held as collateral
under repurchase agreement transactions. Additionally, procedures have been
established by the Fund to monitor, on a daily basis, the market value of each
repurchase agreement's collateral to ensure that the value of collateral at
least equals the repurchase price to be paid under the repurchase agreement
transaction.

The Fund will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed by
the Fund's adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Fund could receive less than
the repurchase price on the sale of collateral securities.

INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS

Interest income and expenses are accrued daily. Bond premium and discount, if
applicable, are amortized as required by the Internal Revenue Code, as amended
(the "Code"). Distributions to shareholders are recorded on the ex- dividend
date.

FEDERAL TAXES

It is the Fund's policy to comply with the provisions of the Code applicable to
regulated investment companies and to distribute to shareholders each year
substantially all of its income. Accordingly, no provisions for federal tax are
necessary.

WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS

The Fund may engage in when-issued or delayed delivery transactions. The Fund
records when-issued securities on the trade date and maintains security
positions such that sufficient liquid assets will be available to make payment
for the securities purchased. Securities purchased on a when- issued or delayed
delivery basis are marked to market daily and begin earning interest on the
settlement date.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts of assets, liabilities, expenses and revenues reported in the
financial statements. Actual results could differ from those estimated.

OTHER

Investment transactions are
accounted for on the

trade date.

SHARES OF BENEFICIAL INTEREST

The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value). At July
31, 1999, capital paid-in aggregated $380,400,408. Transactions in shares were
as follows:

<TABLE>

YEAR ENDED JULY 31 1999 1998
<S> <C> <C>
Shares sold 2,231,199,677 2,195,189,173
Shares issued to
shareholders in payment of
distributions declared 3,706,698 3,867,601
Shares redeemed (2,266,609,807) (2,250,964,853)

NET CHANGE RESULTING FROM

SHARE TRANSACTIONS (31,703,432) (51,908,079)

</TABLE>

INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES

INVESTMENT ADVISORY FEE

Federated Investment Management Company, the Fund's investment adviser (the
"Adviser"), receives for its services an annual investment advisory fee equal to
0.40% of the Fund's average daily net assets. The Adviser will waive, to the
extent of its advisory fee, the amount, if any, by which the Fund's aggregate
annual operating expenses (excluding interest, taxes, brokerage commissions,
expenses of registering and qualifying the Fund and its shares under federal and
state law, expenses of withholding taxes, and extraordinary expenses) exceed
0.45% of average daily net assets of the Fund.

ADMINISTRATIVE FEE

Federated Services Company ("FServ"), under the Administrative Services
Agreement, provides the Fund with administrative personnel and services. The fee
paid to FServ is based on the level of average aggregate daily net assets of all
funds advised by subsidiaries of Federated Investors, Inc. for the period. The
administrative fee received during the period of the Administrative Services
Agreement shall be at least $125,000 per portfolio and $30,000 per each
additional class of shares.

SHAREHOLDER SERVICES FEE

Under the terms of a Shareholder Services Agreement with Federated Shareholder
Services Company ("FSSC"), the Fund will pay FSSC up to 0.25% of average daily
net assets of the Fund shares for the period. The fee paid to FSSC is used to
finance certain services for shareholders and to maintain shareholder accounts.
FSSC may voluntarily choose to waive any portion of its fee. FSSC can modify or
terminate this voluntary waiver at any time at its sole discretion.

TRANSFER AND DIVIDEND DISBURSING AGENT FEES AND EXPENSES

FServ, through its subsidiary FSSC, serves as transfer and dividend disbursing
agent for the Fund. The fee paid to FSSC is based on the size, type, and number
of accounts and transactions made by shareholders.

PORTFOLIO ACCOUNTING FEES

FServ maintains the Fund's accounting records for which it receives a fee. The
fee is based on the level of the Fund's average daily net assets for the period,
plus out-of-pocket expenses.

GENERAL

Certain of the Officers and Trustees of the Fund are Officers and Directors or
Trustees of the above companies.

YEAR 2000 (UNAUDITED)

Similar to other financial organizations, the Fund could be adversely affected
if the computer systems used by the Fund's service providers do not properly
process and calculate date-related information and data from and after January
1, 2000. The Fund's Adviser and administrator are taking measures that they
believe are reasonably designed to address the Year 2000 issue with respect to
computer systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each of the Fund's other service providers.
At this time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact to the Fund.

Independent Auditors' Report

TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF

MONEY MARKET TRUST:

We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Money Market Trust as of July 31, 1999, the
related statement of operations for the year then ended, the statements of
changes in net assets for the years ended July 31, 1999 and 1998, and the
financial highlights for the periods presented. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of the securities owned at July
31, 1999, by correspondence with the custodian and brokers; where replies were
not received, we performed other auditing procedures. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Money Market Trust
as of July 31, 1999, the results of its operations, the changes in its net
assets and its financial highlights for the respective stated periods in
conformity with generally accepted accounting principles.

Deloitte & Touche LLP

Boston, Massachusetts

September 17, 1999

[Graphic]
Federated

World-Class Investment Manager

PROSPECTUS

Money Market Trust

SEPTEMBER 30, 1999

A Statement of Additional Information (SAI), dated September 30, 1999, is
incorporated by reference into this prospectus. Additional information about the
Fund and its investments is contained in the Fund's SAI and SemiAnnual Report to
shareholders as it becomes available. To obtain the SAI, the Semi-Annual Report
and other information without charge, and make inquiries, call your investment
professional or the Fund at 1-800-341- 7400.

You can obtain information about the Fund (including the SAI) by visiting or
writing the Public Reference Room of the Securities and Exchange Commission in
Washington, DC 20549-6009 or from the Commission's Internet site at
http://www.sec.gov. You can call 1-800-SEC-0330 for information on the Public
Reference Room's operations and copying charges.

[Graphic]
Federated

Money Market Trust
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7000

1-800-341-7400

WWW.FEDERATEDINVESTORS.COM

Federated Securities Corp., Distributor

Investment Company Act File No. 811-2550

Cusip 609900105

8083102A (9/99)

[Graphic]

STATEMENT OF ADDITIONAL INFORMATION

Money Market Trust

This Statement of Additional Information (SAI) is not a prospectus. Read this
SAI in conjunction with the prospectus for Money Market Trust (Fund), dated
September 30, 1999. Obtain the prospectus without charge by calling
1-800-341-7400.

SEPTEMBER 30, 1999

[Graphic]
Federated

World-Class Investment Manager
Money Market Trust
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7000

1-800-341-7400

WWW.FEDERATEDINVESTORS.COM

Federated Securities Corp., Distributor

8083102B (9/99)

[Graphic]

CONTENTS

How is the Fund Organized? 1

Securities in Which the Fund Invests 1

How is the Fund Sold? 5

Subaccounting Services 5

Redemption in Kind 5

Massachusetts Partnership Law 6

Account and Share Information 6

Tax Information 6

Who Manages and Provides Services to the Fund? 7

How Does the Fund Measure Performance? 10

Who is Federated Investors, Inc.? 11

Financial Information 12

Addresses 13

How is the Fund Organized?

The Fund is a diversified open-end, management investment company that was
established under the laws of the Commonwealth of Massachusetts on July 24,
1978. The Fund's investment adviser is Federated Investment Management
Company (Adviser). Effective March 31, 1999, Federated Research, former
Adviser to the Fund, became Federated Investment Management Company

(formerly, Federated Advisers).

Securities in Which the Fund Invests

The Fund's principal securities are described in its prospectus. Additional
securities, and further information regarding the principal securities, are
outlined below. In pursuing its investment strategy, the Fund may invest in such
securities for any purpose that is consistent with its investment objective.

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 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 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.

U.S. TREASURY SECURITIES

U.S. Treasury securities are direct obligations of the federal government
of the United States. U.S. Treasury securities are generally regarded as

having the lowest credit risks.

AGENCY SECURITIES

Agency securities are issued or guaranteed by a federal agency or other
government sponsored entity acting under federal authority (a GSE). The United
States supports some GSEs with its full faith and credit. Other GSEs receive
support through federal subsidies, loans or other benefits. A few GSEs have no
explicit financial support, but are regarded as having implied support because
the federal government sponsors their activities. Agency securities are
generally regarded as having low credit risks, but not as low as treasury
securities.

CORPORATE DEBT SECURITIES

COMMERCIAL PAPER

DEMAND INSTRUMENTS

MUNICIPAL SECURITIES

Municipal securities are issued by states, counties, cities and other political
subdivisions and authorities. Although many municipal securities are exempt from
federal income tax, the Fund may invest in taxable municipal securities.

ASSET BACKED SECURITIES

Asset backed securities are payable from pools of obligations other than
mortgages. Most asset backed securities involve consumer or commercial debts
with maturities of less than ten years. However, almost any type of fixed income
assets (including other fixed income securities) may be used to create an asset
backed security. Asset backed securities may take the form of commercial paper,
notes, or pass through certificates. Asset backed securities may be subject to
prepayment risks.

ZERO COUPON SECURITIES

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 market and credit risks of a zero coupon security.

BANK INSTRUMENTS

Bank instruments are unsecured interest bearing deposits with banks. Bank
instruments include bank accounts, time deposits, certificates of deposit
and banker's acceptances. Yankee instruments are denominated in
U.S. dollars and issued by U.S. branches of foreign banks. Eurodollar
instruments are denominated in U.S. dollars and issued by non-
U.S. branches of U.S. or foreign banks.

INSURANCE CONTRACTS

Insurance contracts include guaranteed investment contracts, funding agreements
and annuities. The Fund treats these contracts as fixed income securities.

CREDIT ENHANCEMENT

Common types of credit enhancement include guarantees, letters of credit, bond
insurance and surety bonds. Credit enhancement also includes arrangements where
securities or other liquid assets secure payment of a fixed income security. If
a default occurs, these assets may be sold and the proceeds paid to security's
holders. Either form of credit enhancement reduces credit risks by providing
another source of payment for a fixed income security.

FOREIGN SECURITIES

Foreign securities are securities of issuers based outside the United States.
The Fund considers an issuer to be based outside the United States if:

* it is organized under the laws of, or has a principal office located in,
another country;

* the principal trading market for its securities is in another country; or

* it (or its subsidiaries) derived in its most current fiscal year at least 50%
of its total assets, capitalization, gross revenue or profit from goods
produced, services performed, or sales made in another country.

Along with the risks normally associated with domestic securities of the same
type, foreign securities are subject to currency risks and risks of foreign
investing.

SPECIAL TRANSACTIONS

DELAYED DELIVERY TRANSACTIONS

Delayed delivery transactions, including when issued transactions, are
arrangements in which the Fund buys securities for a set price, with payment and
delivery of the securities scheduled for a future time. During the period
between purchase and settlement, no payment is made by the Fund to the issuer
and no interest accrues to the Fund. The Fund records the transaction when it
agrees to buy the securities and reflects their value in determining the price
of its shares. Settlement dates may be a month or more after entering into these
transactions so that the market values of the securities bought may vary from
the purchase prices. Therefore, delayed delivery transactions create interest
rate risks for the Fund. Delayed delivery transactions also involve credit risks
in the event of a counterparty default.

REPURCHASE AGREEMENTS

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.

REVERSE REPURCHASE AGREEMENTS

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.

ASSET COVERAGE

In order to secure its obligations in connection with special transactions, the
Fund will either own the underlying assets, enter into an offsetting transaction
or set aside readily marketable securities with a value that equals or exceeds
the Fund's obligations. Unless the Fund has other readily marketable assets to
set aside, it cannot trade assets used to secure such obligations without
entering into an offsetting transaction or terminating the special transaction.
This may cause the Fund to miss favorable trading opportunities or to realize
losses on special transactions.

INVESTMENT RATINGS

Securities rated A-1 or A-1+ by Standard & Poor's ("S&P"), Prime-1 by
Moody's Investors Service, Inc. ("Moody's"), or

F-1 (+ or -) by Fitch ICBA, Inc. ("Fitch"), are all considered rated in the
highest short-term rating category. The Fund will follow applicable regulations
in determining whether a security rated by more than one nationally recognized
statistical rating organization ("NRSRO") can be treated as being in the highest
short-term rating category; currently, such securities must be rated by two
NRSROs in their highest rating category.

See "Regulatory Compliance."

INVESTMENT RISKS

There are many factors which may affect an investment in the Fund. The Fund's
principal risks are described in its prospectus. Additional risk factors are
outlined below.

CREDIT RISKS

Fixed income securities generally compensate for greater credit risk by paying
interest at a higher rate. The difference between the yield of a security and
the yield of a U.S. Treasury security with a comparable maturity (the spread)
measures the additional interest paid for risk. Spreads may increase generally
in response to adverse economic or market conditions. A security's spread may
also increase if the security's rating is lowered, or the security is perceived
to have an increased credit risk. An increase in the spread will cause the price
of the security to decline.

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 FOREIGN INVESTING

Foreign securities pose additional risks because foreign economic or political
conditions may be less favorable than those of the United States. Securities in
foreign markets may also be subject to taxation policies that reduce returns for
U.S. investors.

PREPAYMENT RISKS

Unlike traditional fixed income securities, which pay a fixed rate of interest
until maturity (which the entire principal amount is due), payments on asset
backed securities include both interest and a partial payment of principal.
Partial payments of principal may be comprised of scheduled principal payments
as well as unscheduled payments from the from the voluntary prepayment,
refinancing, or foreclosure of the underlying loans. If the Fund receives
unscheduled prepayments, it may have to reinvest the proceeds in other fixed
income securities with lower interest rates, higher credit risks, or other less
favorable characteristics.

FUNDAMENTAL INVESTMENT OBJECTIVE AND POLICIES

The Fund's investment objective is stability of principal and current income
consistent with stability of principal. Money market instruments include, but
are not limited to, U.S. Treasury Bills, all other marketable obligations issued
or guaranteed by the U.S. Government, its agencies or instrumentalities,
instruments of banks and savings and loans which are members of the Federal
Deposit Insurance Corporation (FDIC) or Federal Savings and Loan Insurance
Corporation (FSLIC) (such as certificates of deposit, demand and time deposits,
savings shares and bankers' acceptances), variable amount notes, variable rate
notes, repurchase agreements, prime commercial paper and instruments secured by
such obligations. The Fund will not invest in instruments issued by banks or
savings and loans unless: (a) at the time of investment they have capital,
surplus and undivided profits in excess of $100 million (as of the date of their
most recently published financial statements); or (b) the principal amount of
the instrument is insured in full by the FDIC or FSLIC. Commercial paper
investments will limited to commercial paper rated A-1 by Standard and Poor's
Corporation, Prime 1 by Moody's Investors Services, Inc. or F-1 by Fitch
Investors Services, Inc. In addition, the Fund may purchase money market
instruments (including commercial paper and bank instruments) which are not
rated but are determined by the Board of Trustee or its designee to be of
comparable quality to the other bank or corporate obligations in which the Fund
may invest. The Fund may attempt to increase yield by trading portfolio
securities to take advantage of short-term market variations. The investment
objective and policies may not be changed by the Fund's Board of Trustees
(Trustees) without shareholder approval.

INVESTMENT LIMITATIONS

SELLING SHORT AND BUYING ON MARGIN

The Fund will not purchase any securities on margin or sell any securities short
but it may obtain such short-term credits as may be necessary for clearance of
purchases and sales of securities. The Fund may purchase and dispose of U.S.
government securities before the issuance thereof. The Fund may also purchase
U.S. Government securities on a delayed delivery basis. The settlement dates of
these transactions shall be determined by the mutual agreement of the parties.

BORROWING MONEY

The Fund will not borrow money except as a temporary measure for extraordinary
or emergency purposes and then only in amounts not in excess of 5% of the value
of its total assets or in an amount up to one-third of the value of its total
assets, including the amount borrowed, in order to meet redemption requests
without immediately selling any portfolio securities (any such borrowings under
this section will not be collateralized).

PLEDGING ASSETS

The Fund will not pledge securities.

INVESTING IN COMMODITIES, MINERALS, OR REAL ESTATE

The Fund will not invest in commodities, commodity contracts, oil, gas, or other
mineral programs or real estate, except that it may purchase money market
instruments issued by companies which invest in or sponsor interests therein.

UNDERWRITING

The Fund will not underwrite any issue of securities, except as it may be deemed
to be an underwriter under the Securities Act of 1933 in connection with the
sale of restricted securities which the Fund may purchase pursuant to its
investment objective, policies, and limitations.

LENDING CASH OR SECURITIES

The Fund will not make loans to other persons; provided however that the
purchase or holding of money market instruments, including repurchase agreements
and variable amount and variable market demand master notes, in accordance with
the Fund's investment objective and policies shall not constitute making a loan.

ACQUIRING SECURITIES

The Fund will not acquire the voting securities of any issuer.

INVESTING IN SECURITIES OF OTHER INVESTMENT COMPANIES

The Fund will not invest in securities issued by any other investment company,
except as part of a merger, consolidation, or other acquisition.

INVESTING FOR CONTROL

The Fund will not invest in securities of a company for the purpose of
exercising control or management.

INVESTING IN FOREIGN SECURITIES

The Fund will not invest in foreign securities which are not publicly traded in
the United States.

INVESTING IN ISSUERS WHOSE SECURITIES ARE OWNED BY OFFICERS OF THE

FUND

The Fund will not purchase or retain in its portfolio securities issued by an
issuer, any of whose officers, directors or security holders is an officer,
director or Trustee of the Fund or adviser if, after the purchase of the
securities of such issuer by the Trust, one or more of such officers, directors
or Trustees owns beneficially more than -1/2 of 1% of the shares or securities
or both of such issuer, and such officer, director and trustee owning more than
- -1/2 of 1% of such shares or securities, together own beneficially more than 5%
of such shares or securities.

CONCENTRATION OF INVESTMENTS

The Fund will not purchase securities if as a result of such purchase more than
25% of the value of its total assets would be invested in any one industry.
However, investing in bank instruments such as time and demand deposits and
certificates of deposit, U.S. Treasury Bills or securities issued or guaranteed
by the U.S. Government, its agencies or instrumentalities, or instruments
secured by these money market instruments, such as repurchase agreements for
Government securities, shall not be considered investments in any one industry.

THE ABOVE LIMITATIONS CANNOT BE CHANGED UNLESS AUTHORIZED BY THE TRUSTEES AND BY
THE "VOTE OF A MAJORITY OF ITS OUTSTANDING VOTING SECURITIES," AS DEFINED BY THE
INVESTMENT COMPANY 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.

INVESTING IN RESTRICTED AND ILLIQUID SECURITIES

The Fund may invest in restricted securities. Restricted securities are any
securities in which the Fund may invest pursuant to its investment objective and
policies but which are subject to restrictions on resale under federal
securities law. Under criteria established by the Trustees certain restricted
securities are determined to be liquid. To the extent that restricted securities
are not determined to be liquid the Fund will limit their purchase, together
with other illiquid securities, to 10% of its net assets.

For purposes of the above limitations, the Fund considers instruments issued by
a U.S. branch of a domestic bank or savings and loan having capital, surplus,
and undivided profits in excess of $100,000,000 at the time of investment to be
"cash items." Except with respect to borrowing money, if a percentage limitation
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. The Fund did not borrow money or pledge securities
in excess of 5% of the value of its net assets during the last fiscal year and
has no present intent to do so during the coming fiscal year.

REGULATORY COMPLIANCE

The Fund may follow non-fundamental operational policies that are more
restrictive than its fundamental investment limitations, as set forth in the
prospectus and this Statement of Additional Information, in order to comply with
applicable laws and regulations, including the provisions of and regulations
under the Investment Company Act of 1940. In particular, the Fund will comply
with the various requirements of Rule 2a-7 (the "Rule") which regulates money
market funds. The Fund will determine the effective maturity of its investments
according to the Rule. The Fund may change these operational policies to reflect
changes in the laws and regulations without the approval of its shareholders.

DETERMINING MARKET VALUE OF SECURITIES

The Trustees have decided that the best method for determining the value of
portfolio instruments is amortized cost. Under this method, portfolio
instruments are valued at the acquisition cost as adjusted for amortization of
premium or accumulation of discount rather than at current market value.
Accordingly, neither the amount of daily income nor the net asset value is
affected by any unrealized appreciation or depreciation of the portfolio. In
periods of declining interest rates, the indicated daily yield on shares of the
Fund computed by dividing the annualized daily income on the Fund's portfolio by
the net asset value computed as above may tend to be higher than a similar
computation made by using a method of valuation based upon market prices and
estimates. In periods of rising interest rates, the opposite may be true.

The Fund's use of the amortized cost method of valuing portfolio instruments
depends on its compliance with certain conditions in the Rule. Under the Rule,
the Trustees must establish procedures reasonably designed to stabilize the net
asset value per share, as computed for purposes of distribution and redemption,
at $1.00 per share, taking into account current market conditions and the Fund's
investment objective. The procedures include monitoring the relationship between
the amortized cost value per share and the net asset value per share based upon
available indications of market value. The Trustees will decide what, if any,
steps should be taken if there is a difference of more than 0.5 of 1% between
the two values. The Trustees will take any steps they consider appropriate (such
as redemption in kind or shortening the average portfolio maturity) to minimize
any material dilution or other unfair results arising from differences between
the two methods of determining net asset value.

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.

SHAREHOLDER SERVICES

The Fund may pay Federated Shareholder Services Company, a subsidiary of
Federated Investors, Inc. (Federated), for providing shareholder services and
maintaining shareholder accounts. Federated Shareholder Services Company may
select others to perform these services for their customers and may pay them
fees.

SUPPLEMENTAL PAYMENTS

Investment professionals may be paid fees out of the assets of the Distributor
and/or Federated Shareholder Services Company (but not out of Fund assets). The
Distributor and/or Federated Shareholder Services Company may be reimbursed by
the Adviser or its affiliates.

Investment professionals receive such fees for providing

distribution-related or shareholder services such as sponsoring sales, providing
sales literature, conducting training seminars for employees, and engineering
sales-related computer software programs and systems. Also, investment
professionals may be paid cash or promotional incentives, such as reimbursement
of certain expenses relating to attendance at informational meetings about the
Fund or other special events at recreational-type facilities, or items of
material value. These payments will be based upon the amount of Shares the
investment professional sells or may sell and/or upon the type and nature of
sales or marketing support furnished by the investment professional.

Subaccounting Services

Certain investment professionals 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. Investment professionals holding Shares in a fiduciary, agency,
custodial or similar capacity may charge or pass through subaccount-ing 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 investment professional about the services provided, the
fees charged for those services, and any restrictions and limitations imposed.

Redemption in Kind

Although the Fund intends to pay Share redemptions in cash, it reserves the
right, as described below, 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 Investment
Company Act of 1940, 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's Board determines that payment should be in kind. In such a
case, the Fund will 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. The
portfolio securities will be selected in a manner that the Fund's Board deems
fair and equitable and, to the extent available, such securities will be readily
marketable.

Redemption in kind is not as liquid as a cash redemption. If redemption is made
in kind, shareholders receiving the portfolio securities and selling them before
their maturity could receive less than the redemption value of the securities
and could incur certain transaction costs.

Massachusetts Partnership Law

Under certain circumstances, shareholders may be held personally liable as
partners under Massachusetts law for obligations of the Fund. To protect its
shareholders, the Fund has filed legal documents with Massachusetts that
expressly disclaim the liability of its shareholders for acts or obligations of
the Fund.

In the unlikely event a shareholder is held personally liable for the Fund's
obligations, the Fund is required by the Declaration of Trust to use its
property to protect or compensate the shareholder. On request, the Fund will
defend any claim made and pay any judgment against a shareholder for any act or
obligation of the Fund. Therefore, financial loss resulting from liability as a
shareholder will occur only if the Fund itself cannot meet its obligations to
indemnify shareholders and pay judgments against them.

Account and Share Information

VOTING RIGHTS

Each share of the Fund gives the shareholder one vote in Trustee elections and
other matters submitted to shareholders for vote. All Shares of the Fund have
equal voting rights.

Trustees 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.

As of September 10, 1999, the following shareholders owned of record,
beneficially, or both, 5% or more of outstanding Shares: Fiduciary Trust Company
International, New York, NY owned approximately 72,521,400 (18.87%) shares, The
Brotherhood Bank and Trust Company, Kansas City, KS owned approximately
26,886,021 (7.00%) shares, and The State Bank, Fenton, MI owned approximately
22,063,525 (5.74%) shares.

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.

Tax Information

FEDERAL INCOME TAX

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

Who Manages and Provides Services to the Fund?

BOARD OF TRUSTEES

The Board is responsible for managing the Fund's business affairs and for
exercising all the Fund's powers except those reserved for the shareholders.
Information about each Board member is provided below and includes each
person's: name, address, birth date, present position(s) held with the Fund's,
principal occupations for the past five years and positions held prior to the
past five years, total compensation received as a Trustee from the Fund for its
most recent fiscal year, and the total compensation received from the Federated
Fund Complex for the most recent calendar year. The Federated Fund Complex is
comprised of 54 investment companies, whose investment advisers are affiliated
with the Fund's Adviser.

As of September 10, 1999, the Fund's Board and Officers as a group owned less
than 1% of the Fund's outstanding Shares.

NAME

BIRTH DATE AGGREGATE TOTAL
ADDRESS PRINCIPAL OCCUPATIONS COMPENSATION COMPENSATION
POSITION WITH FUND FOR PAST FIVE YEARS FROM FUND FROM FUND AND FUND COMPLEX
<S> <C> <C> <C>

JOHN F. DONAHUE*+# Chief Executive Officer $0 $0 for the
Birth Date: July 28, 1924 and Director or Trustee of Fund and
Federated Investors Tower the Federated Fund 54 other investment companies
1001 Liberty Avenue Complex; Chairman and in the Fund Complex
Pittsburgh, PA Director, Federated
CHAIRMAN AND TRUSTEE Investors, Inc.; Chairman
and Trustee, Federated Investment
Management Company; Chairman and
Director, Federated Investment
Counseling, and Federated Global
Investment Management Corp.; Chairman,
Passport Research, Ltd.

THOMAS G. BIGLEY Director or Trustee of $1,266.12 $113,860.22 for the
Birth Date: February 3, 1934 the Federated Fund Fund and
15 Old Timber Trail Complex; Director, Member 54 other investment companies
Pittsburgh, PA of Executive Committee, in the Fund Complex
TRUSTEE Children's Hospital of
Pittsburgh; Director,
Robroy Industries, Inc.
(coated steel conduits/
computer storage
equipment); formerly:
Senior Partner, Ernst &
Young LLP; Director, MED
3000 Group, Inc.
(physician practice
management); Director,
Member of Executive
Committee, University of
Pittsburgh.

JOHN T. CONROY, JR. Director or Trustee of the $1,392.96 $125,264.48 for the
Birth Date: June 23, 1937 Federated Fund Complex; Fund and
Wood/IPC Commercial Dept. President, Investment 54 other investment companies
John R. Wood Associates, Inc. Realtors Properties Corporation; in the Fund Complex

3255 Tamiami Trail North Senior Vice President,
Naples, FL John R. Wood and
TRUSTEE Associates, Inc.,

Realtors; Partner or
Trustee in private real
estate ventures in
Southwest Florida;
formerly: President,
Naples Property
Management, Inc. and
Northgate Village
Development Corporation.

NICHOLAS CONSTANTAKIS Director or Trustee of some $1,266.12 $47,958.02 for the
Birth Date: September 3, 1939 of the Federated Fund Fund and
175 Woodshire Drive Complex; formerly: 29 other investment companies
Pittsburgh, PA Partner, Andersen in the Fund Complex

TRUSTEE Worldwide SC.

JOHN F. CUNNINGHAM++ Director or Trustee of some $639.50 $0 for the
Birth Date: March 5, 1943 of the Federated Fund Fund and
353 El Brillo Way Complex; Chairman, 46 other investment companies
Palm Beach, FL President and Chief in the Fund Complex
TRUSTEE Executive Officer,
Cunningham & Co., Inc.
(strategic business
consulting); Trustee
Associate, Boston College;
Director, Iperia Corp.
(communications/software);
formerly: Director,
Redgate Communications and
EMC Corporation (computer
storage systems).
Previous Positions:
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.

LAWRENCE D. ELLIS, M.D.* Director or Trustee of the $1,266.12 $113,860.22 for the
Birth Date: October 11, 1932 Federated Fund Complex; Fund and
3471 Fifth Avenue Professor of Medicine, 54 other investment companies
Suite 1111 University of Pittsburgh; in the Fund Complex

Pittsburgh, PA Medical Director,
TRUSTEE University of Pittsburgh

Medical Center - Downtown;
Hematologist, Oncologist, and
Internist, University of Pittsburgh
Medical Center; Member, National Board
of Trustees, Leukemia Society of
America.

PETER E. MADDEN Director or Trustee of the $1,124.92 $113,860.22 for the
Birth Date: March 16, 1942 Federated Fund Complex; Fund and
One Royal Palm Way formerly: Representative, 54 other investment companies
100 Royal Palm Way Commonwealth of in the Fund Complex
Palm Beach, FL Massachusetts General
TRUSTEE Court; President, State
Street Bank and Trust
Company and State Street
Corporation.
Previous Positions:
Director, VISA USA and VISA
International; Chairman
and Director,
Massachusetts Bankers
Association; Director,
Depository Trust
Corporation; Director, The
Boston Stock Exchange.

NAME

BIRTH DATE AGGREGATE TOTAL
ADDRESS PRINCIPAL OCCUPATIONS COMPENSATION COMPENSATION
POSITION WITH FUND FOR PAST FIVE YEARS FROM FUND FROM FUND AND FUND COMPLEX
<S> <C> <C> <C>

CHARLES F. MANSFIELD, JR.++ Director or Trustee of some $639.50 $0 for the
Birth Date: April 10, 1945 of the Federated Fund Fund and
80 South Road Complex; Management 50 other investment companies
Westhampton Beach, NY Consultant. in the Fund Complex
TRUSTEE 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, Marine Midland Bank;
Vice President, Citibank; Assistant
Professor of Banking and Finance, Frank
G. Zarb School of Business, Hofstra
University.

JOHN E. MURRAY, JR., J.D., S.J.D.# Director or Trustee of $1,330.19 $113,860.22 for the
Birth Date: December 20, 1932 the Federated Fund Fund and
President, Duquesne University Complex; President, Law 54 other investment companies
Pittsburgh, PA Professor, Duquesne in the Fund Complex
TRUSTEE University; Consulting

Partner, Mollica & Murray;
Director, Michael Baker
Corp. (engineering,
construction, operations,
and technical services).
Previous Positions: Dean
and Professor of Law,
University of Pittsburgh
School of Law; Dean and
Professor of Law,
Villanova University
School of Law.

MARJORIE P. SMUTS Director or Trustee of the $1,266.12 $113,860.22 for the
Birth Date: June 21, 1935 Federated Fund Complex; Fund and
4905 Bayard Street Public Relations/ 54 other investment companies
Pittsburgh, PA Marketing/Conference in the Fund Complex

TRUSTEE Planning.
Previous Positions:
National Spokesperson,
Aluminum Company of
America; television
producer; business owner.

JOHN S. WALSH++ Director or Trustee of some $639.50 $0 for the
Birth Date: November 28, 1957 of the Federated Fund Fund and
2007 Sherwood Drive Complex; President and 48 other investment companies
Valparaiso, IN Director, Heat Wagon, Inc. in the Fund Complex
TRUSTEE (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.; Director, Walsh &
Kelly, Inc. (heavy highway
contractor); formerly:
Vice President, Walsh &
Kelly, Inc.

GLEN R. JOHNSON Staff member, Federated $0 $0 for the
Birth Date: May 2, 1929 Securities Corp. Fund and
Federated Investors Tower 8 other investment companies
1001 Liberty Avenue in the Fund Complex

Pittsburgh, PA

PRESIDENT

J. CHRISTOPHER DONAHUE+ President or Executive $0 $0 for the
Birth Date: April 11, 1949 Vice President of the Fund and
Federated Investors Tower Federated Fund Complex; 16 other investment companies
1001 Liberty Avenue Director or Trustee of some in the Fund Complex
Pittsburgh, PA of the Funds in the
EXECUTIVE VICE PRESIDENT Federated Fund Complex;
President, CEO and Director, Federated
Investors, Inc.; President and Trustee,
Federated Investment Management
Company; President and Trustee,
Federated Investment Counseling,
President and Director, Federated
Global Investment Management Corp.;
President, Passport Research, Ltd.;
Trustee, Federated Shareholder Services
Company; Director, Federated Services
Company.

EDWARD C. GONZALES Trustee or Director of some $0 $0 for the
Birth Date: October 22, 1930 of the Funds in the Fund and
Federated Investors Tower Federated Fund Complex; 1 other investment company
1001 Liberty Avenue President, Executive Vice in the Fund Complex
Pittsburgh, PA President and Treasurer of
EXECUTIVE VICE PRESIDENT some of the Funds in the
Federated Fund Complex; Vice Chairman,
Federated Investors, Inc.; Vice
President, Federated Investment
Management Company, Federated
Investment Counseling, Federated Global
Investment Management Corp. and
Passport Research, Ltd.; Executive Vice
President and Director, Federated
Securities Corp.; Trustee, Federated
Shareholder Services Company.

JOHN W. MCGONIGLE Executive Vice President $0 $0 for the
Birth Date: October 26, 1938 and Secretary of the Fund and
Federated Investors Tower Federated Fund Complex; 54 other investment companies
1001 Liberty Avenue Executive Vice President, in the Fund Complex
Pittsburgh, PA Secretary and Director,
EXECUTIVE VICE PRESIDENT AND SECRETARY Federated Investors, Inc.;

Trustee, Federated
Investment Management
Company; Trustee,
Federated Investment
Counseling and Director,
Federated Global
Investment Management
Corp.; Director, Federated
Services Company

NAME

BIRTH DATE AGGREGATE TOTAL
ADDRESS PRINCIPAL OCCUPATIONS COMPENSATION COMPENSATION
POSITION WITH FUND FOR PAST FIVE YEARS FROM FUND FROM FUND AND FUND COMPLEX
<S> <C> <C> <C>

RICHARD J. THOMAS Treasurer of the Federated $0 $0 for the
Birth Date: June 17, 1954 Fund Complex; Vice Fund and
Federated Investors Tower President - Funds 54 other investment companies
1001 Liberty Avenue Financial Services in the Fund Complex
Pittsburgh, PA Division, Federated
TREASURER Investors, Inc.; formerly:
various management
positions within Funds
Financial Services
Division of Federated
Investors, Inc.

RICHARD B. FISHER President or Vice $0 $0 for the
Birth Date: May 17, 1923 President of some of the Fund and
Federated Investors Tower Funds in the Federated Fund 6 other investment companies
1001 Liberty Avenue Complex; Director or in the Fund Complex
Pittsburgh, PA Trustee of some of the
VICE PRESIDENT Funds in the Federated Fund
Complex; Executive Vice
President, Federated
Investors, Inc.; Chairman
and Director, Federated
Securities Corp.

WILLIAM D. DAWSON, III Chief Investment Officer $0 $0 for the
Birth Date: March 3, 1949 of this Fund and various Fund and
Federated Investors Tower other Funds in the 41 other investment companies
1001 Liberty Avenue Federated Fund Complex; in the Fund Complex
Pittsburgh, PA Executive Vice President,
CHIEF INVESTMENT OFFICER Federated Investment

Counseling, Federated Global Investment
Management Corp., Federated Investment
Management Company and Passport
Research, Ltd.; Registered
Representative, Federated Securities
Corp.; Portfolio Manager, Federated
Administrative Services; Vice
President, Federated Investors, Inc.;
formerly: Executive Vice President and
Senior Vice President, Federated
Investment Counseling Institutional
Portfolio Management Services Division;
Senior Vice President, Federated
Investment Management Company and
Passport Research, Ltd.

</TABLE>

* An asterisk denotes a Trustee who is deemed to be an interested person as
defined in the Investment Company Act of 1940.

# A pound sign denotes a Member of the Board's Executive Committee, which
handles the Board's responsibilities between its meetings.

+ Mr. Donahue is the father of J. Christopher Donahue, Executive Vice
President of the Fund.

++ Messrs. Cunningham, Mansfield and Walsh became members of the Board of
Trustees on January 1, 1999. They did not earn any fees for serving the Fund
Complex since these fees are reported as of the end of the last calendar year.
They did not receive any fees as of the fiscal year end of the Trust.

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.

The Adviser must waive the portion of its advisory fee that increases the Fund's
aggregate annual operating expenses above 0.45% of its average daily net assets.
The Fund's operating expenses include the advisory fee but exclude interest,
taxes, brokerage commissions, expenses of registering the Fund and its Shares
under federal and state laws, expenses of withholding taxes, and extraordinary
expenses.

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.

BROKERAGE TRANSACTIONS

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. The Adviser will generally use those who are recognized dealers in
specific portfolio instruments, except when a better price and execution of the
order can be obtained elsewhere. In selecting among firms believed to meet these
criteria, the Adviser may give consideration to those firms which have sold or
are selling Shares of the Fund and other funds distributed by the Distributor
and its affiliates. 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. 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 that this procedure could adversely impact the price paid or received
and/or the position obtained or disposed of by the Fund.

ADMINISTRATOR

Federated Services Company, a subsidiary of Federated, provides administrative
personnel and services (including certain legal and financial reporting
services) necessary to operate the Fund.

Federated Services Company provides these at the following annual rate of the
average aggregate daily net assets of all Federated Funds as specified below:

MAXIMUM AVERAGE AGGREGATE DAILY ADMINISTRATIVE FEE NET ASSETS OF THE FEDERATED
FUNDS 0.150 of 1% on the first $250 million 0.125 of 1% on the next $250 million
0.100 of 1% on the next $250 million 0.075 of 1% on assets in excess of $750
million

The administrative fee received during any fiscal year shall be at least
$125,000 per portfolio. Federated Services Company may voluntarily waive a
portion of its fee and may reimburse the Fund for expenses.

Federated Services Company 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. Foreign instruments purchased by the Fund are
held by foreign banks participating in a network coordinated by State Street
Bank.

TRANSFER AGENT AND DIVIDEND DISBURSING AGENT

Federated Services Company, through its registered transfer agent subsidiary,
Federated Shareholder Services Company, maintains all necessary shareholder
records. The Fund pays the transfer agent a fee based on the size, type, and
number of accounts and transactions made by

shareholders.

INDEPENDENT AUDITORS

The independent auditor for the Fund, Deloitte & Touche LLP, plans and performs
its audit so that it may provide an opinion as to whether the Fund's financial
statements and financial highlights are free of material misstatement.

FEES PAID BY THE FUND FOR SERVICES

FOR THE PERIOD ENDED JULY 31 1999 1998 1997
Advisory Fee Earned $1,762,698 $1,715,287 $2,020,387
Advisory Fee Reduction 706,475 599,001 662,649
Administrative Fee 332,269 323,485 381,501
SHAREHOLDER SERVICES FEE 220,337 - -

If the Fund's expenses are capped at a particular level, the cap does not
include reimbursement to the Fund of any expenses incurred by shareholders who
use the transfer agent's subaccounting facilities.

How Does the Fund Measure Performance?

The Fund may advertise Share performance by using the Securities and Exchange
Commission's (SEC) standard method 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
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 given for the one-year, five-year and ten-year periods ended July
31, 1999.

Yield and Effective Yield given for the 7-day period ended July 31, 1999.

7-DAY PERIOD 1 YEAR 5 YEARS 10 YEARS
Total Return - 4.88% 5.23% 5.22%
Yield 4.72% - - -
Effective Yield 4.84% - - -

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 $1,000 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 $1,000, less any applicable sales charge, adjusted over the
period by any additional Shares, assuming the annual reinvestment of all
dividends and distributions.

YIELD AND EFFECTIVE YIELD

The yield of Shares is based upon the seven days ending on the day of the
calculation, called the "base period." This yield is calculated by: determining
the net change in the value of a hypothetical account with a balance of one
Share at the beginning of the base period, with the net change excluding capital
changes but including the value of any additional Shares purchased with
dividends earned from the original one Share and all dividends declared on the
original and any purchased Shares; dividing the net change in the account's
value by the value of the account at the beginning of the base period to
determine the base period return; and multiplying the base period return by
365/7. The effective yield is calculated by compounding the unannualized
base-period return by: adding one to the base-period return, raising the sum to
the

365/7th power; and subtracting one from the result.

To the extent investment professionals and broker/dealers charge fees in
connection with services provided in conjunction with an investment in Shares,
the Share performance is lower for shareholders paying those fees.

PERFORMANCE COMPARISONS

Advertising and sales literature may include:

* references to ratings, rankings, and financial publications and/or
performance comparisons of Shares to certain indices;

* charts, graphs and illustrations using the Fund's returns, or returns in
general, that demonstrate investment concepts such as tax-deferred compounding,
dollar-cost averaging and systematic investment;

* discussions of economic, financial and political developments and their impact
on the securities market, including the portfolio manager's views on how such
developments could impact the Fund; and

* information about the mutual fund industry from sources such as the Investment
Company Institute.

The Fund may compare its performance, or performance for the types of securities
in which it invests, to a variety of other investments, including federally
insured bank products such as bank savings accounts, certificates of deposit,
and Treasury bills.

The Fund may quote information from reliable sources regarding individual
countries and regions, world stock exchanges, and economic and demographic
statistics.

You may use financial publications and/or indices to obtain a more complete view
of Share performance. When comparing performance, you should consider all
relevant factors such as the composition of the index used, prevailing market
conditions, portfolio compositions of other funds, and methods used to value
portfolio securities and compute offering price. The financial publications
and/or indices which the Fund uses in advertising may include:

LIPPER ANALYTICAL SERVICES, INC.

Lipper Analytical Services, Inc., ranks funds in various fund categories based
on total return, which assumes the reinvestment of all income dividends and
capital gains distributions, if any.

IBC/DONOGHUE'S MONEY FUND REPORT

IBC/Donoghue's Money Fund Report publishes annualized yields of money market
funds weekly. Donoghue's Money Market Insight publication reports monthly and
12-month-to-date investment results for the same money funds.

MONEY

Money, a monthly magazine, regularly ranks money market funds in various
categories based on the latest available seven-day effective yield.

SALOMON 30-DAY CD INDEX

Salomon 30-Day CD Index compares rate levels of 30-day certificates of deposit
from the top ten prime representative banks.

Who is Federated Investors, Inc.?

Federated is dedicated to meeting investor needs by making structured,
straightforward and consistent investment decisions. Federated investment
products have a history of competitive performance and have gained the
confidence of thousands of financial institutions and individual investors.

Federated's disciplined investment selection process is rooted in sound
methodologies backed by fundamental and technical research. At Federated,
success in investment management does not depend solely on the skill of a single
portfolio manager. It is a fusion of individual talents and state- of-the-art
industry tools and resources. Federated's investment process involves teams of
portfolio managers and analysts, and investment decisions are executed by
traders who are dedicated to specific market sectors and who handle trillions of
dollars in annual trading volume.

FEDERATED FUNDS OVERVIEW

MUNICIPAL FUNDS

In the municipal sector, as of December 31, 1998, Federated managed 10 bond
funds with approximately $2.2 billion in assets and 23 money market funds with
approximately $12.5 billion in total assets. In 1976, Federated introduced one
of the first municipal bond mutual funds in the industry and is now one of the
largest institutional buyers of municipal securities. The Funds may quote
statistics from organizations including The Tax Foundation and the National
Taxpayers Union regarding the tax obligations of Americans.

EQUITY FUNDS

In the equity sector, Federated has more than 28 years' experience. As of
December 31, 1998, Federated managed 27 equity funds totaling approximately
$14.9 billion in assets across growth, value, equity income, international,
index and sector (i.e. utility) styles. Federated's value- oriented management
style combines quantitative and qualitative analysis and features a structured,
computer-assisted composite modeling system that was developed in the 1970s.

CORPORATE BOND FUNDS

In the corporate bond sector, as of December 31, 1998, Federated managed 9 money
market funds and 15 bond funds with assets approximating $22.8 billion and $7.1
billion, respectively. Federated's corporate bond decision making-based on
intensive, diligent credit analysis-is backed by over 26 years of experience in
the corporate bond sector. In 1972, Federated introduced one of the first
high-yield bond funds in the industry. In 1983, Federated was one of the first
fund managers to participate in the asset backed securities market, a market
totaling more than $209 billion.

GOVERNMENT FUNDS

In the government sector, as of December 31, 1998, Federated managed 9 mortgage
backed, 5 government/agency and 19 government money market mutual funds, with
assets approximating $5.3 billion, $1.8 billion and $41.6 billion, respectively.
Federated trades approximately $425 million in U.S. government and mortgage
backed securities daily and places approximately $25 billion in repurchase
agreements each day. Federated introduced the first U.S. government fund to
invest in U.S. government bond securities in 1969. Federated has been a major
force in the short- and intermediate-term government markets since 1982 and
currently manages approximately $43.2 billion in government funds within these
maturity ranges.

MONEY MARKET FUNDS

In the money market sector, Federated gained prominence in the mutual fund
industry in 1974 with the creation of the first institutional money market fund.
Simultaneously, the company pioneered the use of the amortized cost method of
accounting for valuing shares of money market funds, a principal means used by
money managers today to value money market fund shares. Other innovations
include the first institutional tax-free money market fund. As of December 31,
1998, Federated managed more than $76.7 billion in assets across 52 money market
funds, including 19 government, 9 prime and 23 municipal with assets
approximating $41.6 billion, $22.8 billion and $12.5 billion, respectively.

The Chief Investment Officers responsible for oversight of the various
investment sectors within Federated are: U.S. equity and high yield-
J. Thomas Madden; U.S. fixed income-William D. Dawson, III; and global
equities and fixed income-Henry A. Frantzen. The Chief Investment Officers
are Executive Vice Presidents of the Federated advisory companies.

MUTUAL FUND MARKET

Thirty-seven percent of American households are pursuing their financial goals
through mutual funds. These investors, as well as businesses and institutions,
have entrusted over $5 trillion to the more than 7,300 funds available,
according to the Investment Company Institute.

FEDERATED CLIENTS OVERVIEW

Federated distributes mutual funds through its subsidiaries for a variety of
investment purposes. Specific markets include:

INSTITUTIONAL CLIENTS

Federated meets the needs of approximately 900 institutional clients nationwide
by managing and servicing separate accounts and mutual funds for a variety of
purposes, including defined benefit and defined contribution programs, cash
management, and asset/liability management. Institutional clients include
corporations, pension funds, tax exempt entities, foundations/endowments,
insurance companies, and investment and financial advisers. The marketing effort
to these institutional clients is headed by John B. Fisher, President,
Institutional Sales Division, Federated Securities Corp.

BANK MARKETING

Other institutional clients include more than 1,600 banks and trust
organizations. Virtually all of the trust divisions of the top 100 bank holding
companies use Federated Funds in their clients' portfolios. The marketing effort
to trust clients is headed by

Timothy C. Pillion, Senior Vice President, Bank Marketing & Sales.

BROKER/DEALERS AND BANK BROKER/DEALER SUBSIDIARIES

Federated Funds are available to consumers through major brokerage firms
nationwide-we have over 2,200 broker/dealer and bank broker/dealer relationships
across the country-supported by more wholesalers than any other mutual fund
distributor.

Federated's service to financial professionals and institutions has earned it
high ratings in several surveys performed by DALBAR, Inc. DALBAR is recognized
as the industry benchmark for service quality measurement. The marketing effort
to these firms is headed by James F. Getz, President, Broker/Dealer Sales
Division, Federated Securities Corp.

Financial Information

The Financial Statements for the Fund for the fiscal year ended July 31, 1999
are incorporated herein by reference to the Annual Report to Shareholders of
Money Market Trust dated July 31, 1999.

Addresses

MONEY MARKET TRUST

Federated Investors Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7000

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

State Street Bank and Trust Company
P.O. Box 8600

Boston, MA 02266-8600

TRANSFER AGENT AND DIVIDEND DISBURSING AGENT

Federated Shareholder Services Company
P.O. Box 8600

Boston, MA 02266-8600

INDEPENDENT AUDITORS

Deloitte & Touche LLP
200 Berkeley Street
Boston, MA 02116

PART C. OTHER INFORMATION.

Item 23. Exhibits:

(a) Conformed copy of Declaration of Trust of the
Registrant; (14) (b) (i) Copy of By-Laws of the
Registrant; (14)

(ii) Copy of Amendment to By-Laws of Registrant; (14)
(iii)Copy of Amendment No. 2 to the By-Laws of Registrant;(15)
(iv) Copy of Amendment No. 3 to the By-Laws of Registrant; (15)
(v) Copy of Amendment No. 4 to the By-Laws of Registrant;(15)
(vi) Copy of Amendment No. 5 to the By-Laws of Registrant;(15)

(c) Copy of Specimen Certificate for Shares of Beneficial
Interest of the Registrant; (14) (d) Conformed copy of
Investment Advisory Contract of the Registrant; (14) (e)
(i) Conformed copy of Distributor's Contract of the
Registrant; (13)

(ii) 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(e) of
the Cash Trust Series II Registration
Statement on Form N-1A, filed with the
Commission on July 24, 1995. (File Nos.
33-38550 and 811-6269).

(f) Not applicable;

(g) (i) Conformed copy of Custodian Agreement of
the Registrant; (13)
(ii) Conformed copy of Domestic Custodian Fee
Schedule;(15)

(h) (i) Conformed copy of Amended and Restated
Agreement for Fund Accounting Services,
Administrative Services, Transfer Agency Services,
and Custody Services . Procurement;(15) (ii)
Conformed Copy of Amended and Restated Shareholder
Services Agreement;(15) (iii) The responses
described in Item 24(e)(ii) are hereby incorporated
by reference.

(i) Not applicable;

(j) Conformed copy of Consent of Independent Auditors; +
(k) Not Applicable;

+ All exhibits have been filed electronically.

13. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 37 on Form N-1A filed September 29, 1995. (File No. 2-62285)

14. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 39 on Form N-1A filed September 26, 1996. (File No. 2-62285)

15. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 41 on Form N-1A filed September 24, 1998.

(l) Conformed Copy of Initial Capital Understanding; (14)
(m) Not applicable;

(n) Copy of Financial Data Schedule; (not included per
footnote 60 of Release No. 33-7684) (o) Not applicable;
(p) (i) Conformed copy of Power of Attorney; (15)

(ii) Conformed copy of Limited Power of Attorney; (16)

(iii) Conformed copy of Power of Attorney of Chief
Investment Officer; (16) (iv) Conformed copy of
Power of Attorney of Trustee of the Registrant;
(16) (v) Conformed copy of Power of Attorney of
Trustee of the Registrant; (16) (vi) Conformed copy
of Power of Attorney of

Trustee of the Registrant; (16)

Item 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH FUND:

None

Item 25. Indemnification: (2.)

Item 26. 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 four of the Trustees and one 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 Trustee of the investment adviser, his
position with the investment adviser, and, in parentheses, his
principal occupation is: Mark D. Olson (Partner, Wilson, Halbrook &
Bayard), 107 W. Market Street, Georgetown, Delaware 19947.

The remaining Officers of the investment adviser are:

Executive Vice Presidents: William D. Dawson, III
Henry A. Frantzen
J. Thomas Madden

Senior Vice Presidents: Joseph M. Balestrino
David A. Briggs
Drew J. Collins
Jonathan C. Conley
Deborah A. Cunningham
Michael P. Donnelly
Mark E. Durbiano

- ----------------
+ All exhibits have been filed electronically.

2. Response is incorporated by reference to Registrant's Post Effective
Amendment No. 4 on Form N-1 filed November 20, 1980. (File No. 2-62285)

14. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 39 on Form N-1A filed September 26, 1996. (File No. 2-62285)

15. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 41 on Form N-1A filed September 24, 1998.

16. Response is incorporated by reference to Registrant's Post Effective
Amendment No. 44 on Form N-1A filed July 28, 1999.

Senior Vice Presidents: Joseph M. Balestrino
David A. Briggs
Drew J. Collins
Jonathan C. Conley
Deborah A. Cunningham
Michael P. Donnelly
Mark E. Durbiano
Jeffrey A. Kozemchak
Sandra L. McInerney
Susan M. Nason
Mary Jo Ochson
Robert J. Ostrowski

Vice Presidents: Todd A. Abraham
J. Scott Albrecht
Arthur J. Barry

Vice Presidents: Todd A. Abraham
J. Scott Albrecht
Arthur J. Barry
Randall S. Bauer
G. Andrew Bonnewell
David A. Briggs
Micheal W. Casey
Robert E. Cauley
Kenneth J. Cody
Alexandre de Bethmann
B. Anthony Delserone, Jr.
Linda A. Duessel
Donald T. Ellenberger
Kathleen M. Foody-Malus
Thomas M. Franks
Edward C. Gonzales
James E. Grefenstette
Marc Halperin
Patricia L. Heagy
Susan R. Hill
William R. Jamison
Constantine J. Kartsonas
Stephen A. Keen
Robert M. Kowit
Richard J. Lazarchic
Steven Lehman
Marian R. Marinack
William M. Painter
Jeffrey A. Petro
Keith J. Sabol
Frank Semack
Aash M. Shah
Michael W. Sirianni, Jr.
Christopher Smith
Tracy P. Stouffer
Edward J. Tiedge
Peter Vutz
Paige M. Wilhelm
George B. Wright
Jolanta M. Wysocka

<PAGE>

Assistant Vice Presidents: Nancy J. Belz
Lee R. Cunningham, II
James H. Davis, II
Jacqueline A. Drastal
Paul S. Drotch
Salvatore A. Esposito
Donna M. Fabiano
Gary E. Farwell
Eamonn G. Folan
John T. Gentry
John W. Harris
Nathan H. Kehm
John C. Kerber
Grant K. McKay
Natalie F. Metz
Joseph M. Natoli
Ihab Salib
James W. Schaub
John Sheehy
Matthew K. Stapen
Diane Tolby
Timothy G. Trebilcock
Leonardo A. Vila
Steven J. Wagner
Lori A. Wolff

Secretary: G. Andrew Bonnewell

Treasurer: Thomas R. Donahue

Assistant Secretaries: Thomas R. Donahue
Richard B. Fisher

Assistant Treasurer: Richard B. Fisher

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.

ITEM 27. PRINCIPAL UNDERWRITERS:

(a)....Federated Securities Corp. the Distributor for shares of the Fund,
acts as principal underwriter for the following open-end investment companies,
including the Registrant:

Cash Trust Series II; Cash Trust Series, Inc.; CCB Funds; Edward D. Jones & Co.
Daily Passport Cash Trust; Federated Adjustable Rate U.S. Government Fund, Inc.;
Federated American Leaders Fund, Inc.; Federated ARMs Fund; Federated Core
Trust; Federated Equity Funds; Federated Equity Income Fund, Inc.; Federated
Fund for U.S. Government Securities, Inc.; Federated GNMA Trust; Federated
Government Income Securities, Inc.; Federated Government Trust; 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 Municipal Opportunities Fund, Inc.;
Federated Municipal Securities Fund, Inc.; Federated Municipal Trust; Federated
Short-Term Municipal Trust; Federated Stock and Bond Fund, Inc.; Federated Stock
Trust; Federated Tax-Free Trust; 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 U.S. Government
Securities Fund: 5-10 Years; Federated Utility Fund, Inc.; Fixed Income
Securities, Inc.; ; Hibernia Funds; Independence One Mutual Funds; Intermediate
Municipal Trust; International Series, Inc.; Investment Series Funds, Inc.;
Liberty U.S. Government Money Market Trust; Managed Series Trust; Marshall
Funds, Inc.; Money Market Management, Inc.; Money Market Obligations Trust;
Money Market Obligations Trust II; Money Market Trust; Municipal Securities
Income Trust; Newpoint Funds; Regions Funds; RIGGS Funds; SouthTrust Funds;
Tax-Free Instruments Trust; The Planters Funds; The Wachovia Funds; The Wachovia
Municipal Funds; Vision Group of Funds, Inc.; World Investment Series, Inc.;
Blanchard Funds; Blanchard Precious Metals Fund, Inc.; DG Investor Series; High
Yield Cash Trust; Investment Series Trust; Star Funds; Targeted Duration Trust;
The Virtus Funds; Trust for Financial Institutions;

Federated Securities Corp. also acts as principal underwriter for the
following closed-end investment company: Liberty Term Trust, Inc.- 1999.

(b)

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

Richard B. Fisher Chairman, Chief Executive
Federated Investors Tower Officer, Chief Operating
1001 Liberty Avenue Officer, Asst. Secretary
Pittsburgh, PA 15222-3779 and Asst. Treasurer,

Federated Securities Corp.

Arthur L. Cherry Director
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue

Pittsburgh, PA 15222-3779

John B. Fisher President-Institutional Sales and
Federated Investors Tower Director, Federated Securities Corp.
1001 Liberty Avenue

Pittsburgh, PA 15222-3779

Thomas R. Donahue Director, Assistant Secretary
Federated Investors Tower and Assistant Treasurer
1001 Liberty Avenue Federated Securities Corp.

Pittsburgh, PA 15222-3779

James F. Getz President-Broker/Dealer and --
Federated Investors Tower Director
1001 Liberty Avenue Federated Securities Corp.
Pittsburgh, PA 15222-3779

Edward C. Gonzales Executive Vice President Executive Vice
Federated Investors Tower Federated Securities Corp. President
1001 Liberty Avenue

Pittsburgh, PA 15222-3779

David M. Taylor Executive Vice President --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

Mark W. Bloss Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Richard W. Boyd Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Laura M. Deger Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Theodore Fadool, Jr. Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Bryant R. Fisher Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Christopher T. Fives Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

James S. Hamilton Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

James M. Heaton Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Keith Nixon Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Solon A. Person, IV Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Timothy C. Pillion Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Thomas E. Territ Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

Ernest G. Anderson Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Teresa M. Antoszyk Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

John B. Bohnet Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Jane E. Broeren-Lambesis Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Matthew W. Brown Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

David J. Callahan Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Mark Carroll Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Steven R. Cohen Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Mary J. Combs Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

R. Edmond Connell, Jr. Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

R. Leonard Corton, Jr. Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Kevin J. Crenny Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

Daniel T. Culbertson Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

G. Michael Cullen Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Marc C. Danile Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Robert J. Deuberry Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

William C. Doyle Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Jill Ehrenfeld Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Mark D. Fisher Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Mark A. Gessner Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Joseph D. Gibbons Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

John K. Goettlicher Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Craig S. Gonzales Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

G. Tad Gullickson Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

Dayna C. Haferkamp Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Raymond Hanley Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Bruce E. Hastings Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Beth A. Hetzel Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

James E. Hickey Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Charlene H. Jennings Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

H. Joseph Kennedy Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Michael W. Koenig Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Christopher A. Layton Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Michael H. Liss Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Michael R. Manning Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Mark J. Miehl Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

Richard C. Mihm Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Alec H. Neilly Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Thomas A. Peters III Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Robert F. Phillips Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Richard A. Recker Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Eugene B. Reed Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Paul V. Riordan Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

John Rogers Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Brian S. Ronayne Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Thomas S. Schinabeck Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Edward J. Segura Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Edward L. Smith Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

David W. Spears Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

John A. Staley Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Colin B. Starks Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Jeffrey A. Stewart Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

William C. Tustin Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Paul A. Uhlman Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Miles J. Wallace Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

John F. Wallin Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Richard B. Watts Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Edward J. Wojnarowski Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Michael P. Wolff Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Robert W. Bauman Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices

BUSINESS ADDRESS WITH DISTRIBUTOR WITH FUND

Edward R. Bozek Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Terri E. Bush Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Beth C. Dell Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

David L. Immonen Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

John T. Glickson Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Ernest L. Linane Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Renee L. Martin Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Robert M. Rossi Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

Matthew S. Hardin Secretary, --
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

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

Leslie K. Ross Assistant Secretary,
Federated Investors Tower Federated Securities Corp.
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

</TABLE>

Item 28. 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 Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, PA 15222-3779

(Notices should be sent to the Agent for Service at above address)

Federated Investors Fund
5800 Corporate Drive
Pittsburgh, PA 15237-7000

Federated Shareholder Services Company Federated Investors Tower
("Transfer Agent and Dividend 1001 Liberty Avenue
Federated Services Company Pittsburgh, PA 15222-3779

Disbursing Agent)

Federated Services Company Federated Investors Tower
("Administrator") 1001 Liberty Avenue

Pittsburgh, PA 15222-3779

Federated Investment Management Company Federated Investors Tower
("Adviser") 1001 Liberty Avenue

Pittsburgh, PA 15222-3779

State Street Bank and Trust Company P.O. Box 8600

("Custodian") Boston, MA
02266-8600

Item 29. Management Services: Not applicable.

Item 30. 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.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, MONEY MARKET TRUST, has duly
caused this Amendment to its Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, all in the City of Pittsburgh and
Commonwealth of Pennsylvania, on the 28th day of September, 1999.

MONEY MARKET TRUST

BY: /s/ Gail Cagney
Gail Cagney, Assistant Secretary
Attorney in Fact for John F. Donahue
September 28, 1999

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 Cagney
Gail Cagney Attorney In Fact September 28, 1999
ASSISTANT SECRETARY For the Persons

Listed Below

NAME TITLE

John F. Donahue* Chairman and Trustee
(Chief Executive Officer)

Glen R. Johnson* President

Richard J. Thomas* Treasurer (Principal
Financial and
Accounting Officer)

Thomas G. Bigley* Trustee

John T. Conroy, Jr.* Trustee

Nicholas P. Constantakis* Trustee

John F. Cunningham* Trustee

Lawrence D. Ellis, M.D.* Trustee

Peter E. Madden* Trustee

Charles F. Mansfield, Jr.* Trustee

John E. Murray, Jr., J.D. S.J.D.* Trustee

Marjorie P. Smuts* Trustee

John S. Walsh * Trustee

* By Power of Attorney

Exhibit j under Form N-1A
Exhibit 23 under Item 601/ Reg. S-K

INDEPENDENT AUDITORS' CONSENT

To the Board of Trustee and Shareholders of
Money Market Trust:

We consent to the use in Post- Effective Amendment No. 46 to Registration
Statement 811-2550 of Money Market Trust of our report dated September 17, 1999
appearing in the Prospectus, which is a part of such Registration Statement, and
to the reference to us under the heading "Financial Highlights" in such
Prospectus.

/s/ Deloitte & Touche LLP
Deloitte & Touche LLP

Boston, Massachusetts
September 27, 1999