FEDERATED LIMITED TERM FUND
FEDERATED LIMITED TERM MUNICIPAL FUND
(Portfolios of Fixed Income Securities, Inc.)
Class A Shares
Supplement to Prospectuses dated January 31, 1998
1. Effective August 3, 1998, please delete the following disclosure in the
prospectus section entitled "Dealer Concession":
"On purchases of $1 million or more, the investor pays no sales charge;
however, the distributor will make twelve monthly payments to the dealer
totaling 0.25% of the public offering price over the first year following the
purchase. Such payments are based on the original purchase price of Shares
outstanding at each month end."
and insert the following language in its place:
"Financial intermediaries purchasing Class A Shares for their customers in
amounts of $1 million or more are eligible to receive an advance commission
from the distributor based on the following breakpoints:
Advance Commission
as a Percentage of
Transaction Amount Public Offering Price
First $1 - $5 million 0.75%
Next $5 - $20 million 0.50%
Over $20 million 0.25%
For accounts with assets over $1 million, the dealer commission resets
annually to the first breakpoint on the anniversary of the first purchase.
Class A Share purchases under this program may be made by Letter of Intent or
by combining concurrent purchases. The above commission will be paid only on
those purchases that were not previously subject to a front-end sales charge
and dealer commission. Certain retirement accounts may not be eligible for
this program. Financial intermediaries must notify the Fund once an account
reaches $1 million in order to qualify for advance commissions.
A contingent deferred sales charge of 0.75% of the redemption amount applies
to Class A Shares redeemed up to 24 months after purchase if a financial
intermediary received an advance commission on the transaction."
<PAGE>
2. The "Summary of Fund Expenses" table on page 1 of each Fund's prospectus is
amended.
a.Under "Shareholder Transaction Expenses," for Class A Shares, the line item
on the contingent deferred sales charge is deleted and replaced with:
"Contingent Deferred Sales Charge (as a percentage of original 0.00%+
purchase price or redemption proceeds, as applicable)"
b. Add the following as the first footnote:
"+ Shareholders who purchased $1 million or more of Class A Shares through
a financial intermediary on or after August 3, 1998, may be charged a
contingent deferred sales charge of 0.75% for redemptions made within 24
months of purchase if the financial intermediary received an advance
commission."
3. Please add the following directly after the prospectus section entitled
"Systematic Withdrawal Program:"
"Contingent Deferred Sales Charge
The contingent deferred sales charge will be deducted from the redemption
proceeds otherwise payable to the shareholder and will be retained by the
distributor. Redemptions will be processed in a manner intended to maximize
the amount of redemption which will not be subject to a contingent deferred
sales charge. The contingent deferred sales charge will not be imposed with
respect to Shares acquired through the reinvestment of dividends or
distributions of long-term capital gains. In determining the applicability of
the contingent deferred sales charge, the required holding period for your
new Shares received through an exchange will include the period for which
your original Shares were held.
Eliminating the Contingent Deferred Sales Charge
Upon written notification to Federated Securities Corp. or the transfer
agent, no contingent deferred sales charge will be imposed on redemptions:
n following the death or disability, as defined in Section 72(m)(7) of the
Internal Revenue Code of 1986, of the last surviving shareholder and any
designated beneficiaries;
n representing minimum required distributions from an Individual Retirement
Account or other retirement plan to a shareholder who has attained the age
of 70 1/2; and
n which are reinvested in the Fund under the reinvestment privilege.
<PAGE>
For more information regarding the elimination of the contingent deferred
sales contact your financial intermediary or the Fund. The Fund reserves the
right to discontinue or modify these provisions. Shareholders will be
notified of such action."
July 31, 1998
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Cusip 338319106
Cusip 338319403
G02455-02 (7/98)
[GRAPHIC OMITTED]
FEDERATED STRATEGIC INCOME FUND
(A Portfolio of Fixed Income Securities, Inc.)
Class A Shares
Supplement to Prospectus dated January 31, 1998
1. Effective August 3, 1998, please delete the following disclosure in the
prospectus section entitled "Dealer Concession" on page 16:
"On purchases of $1 million or more, the investor pays no sales charge;
however, the distributor will make twelve monthly payments to the dealer
totaling 0.25% of the public offering price over the first year following the
purchase. Such payments are based on the original purchase price of Shares
outstanding at each month end."
and insert the following language in its place:
"Financial intermediaries purchasing Class A Shares for their customers in
amounts of $1 million or more are eligible to receive an advance commission
from the distributor based on the following breakpoints:
Advance Commission
as a Percentage of
Transaction Amount Public Offering Price
First $1 - $5 million 0.75%
Next $5 - $20 million 0.50%
Over $20 million 0.25%
For accounts with assets over $1 million, the dealer commission resets
annually to the first breakpoint on the anniversary of the first purchase.
Class A Share purchases under this program may be made by Letter of Intent or
by combining concurrent purchases. The above commission will be paid only on
those purchases that were not previously subject to a front-end sales charge
and dealer commission. Certain retirement accounts may not be eligible for
this program. Financial intermediaries must notify the Fund once an account
reaches $1 million in order to qualify for advance commissions.
A contingent deferred sales charge of 0.75% of the redemption amount applies
to Class A Shares redeemed up to 24 months after purchase if a financial
intermediary received an advance commission on the transaction."
<PAGE>
2. The "Summary of Fund Expenses" table on page 1 of the Fund's prospectus is
amended.
a.Under "Shareholder Transaction Expenses," for Class A Shares, the line item
on the contingent deferred sales charge is deleted and replaced with:
"Contingent Deferred Sales Charge (as a percentage of original 0.00% (1)
purchase price or redemption proceeds, as applicable)"
b. Footnote (1) is amended by adding the following as the first sentence:
"+ Shareholders who purchased $1 million or more of Class A Shares through
a financial intermediary on or after August 3, 1998, may be charged a
contingent deferred sales charge of 0.75% for redemptions made within 24
months of purchase if the financial intermediary received an advance
commission."
July 31, 1998
[GRAPHIC OMITTED]
Cusip 338319700
G01055-08 (7/98)
[GRAPHIC OMITTED]
