Federated MDT Large Cap Value Fund

Transcription

1 April 30, 2018 Share Class Ticker A FSTRX B QBLVX C QCLVX R QRLVX Institutional FMSTX Service FSTKX R6 FSTLX Federated MDT Large Cap Value Fund Fund Established 1982 A Portfolio of Federated MDT Equity Trust Dear Valued Shareholder, I am pleased to present the for your fund covering the period from November 1, 2017 through April 30, This report includes a complete listing of your fund s holdings, performance information and financial statements along with other important fund information. In addition, our website, FederatedInvestors.com, offers easy access to Federated resources that include timely fund updates, economic and market insights from our investment strategists, and financial planning tools. We invite you to register to take full advantage of its capabilities. Thank you for investing with Federated. I hope you find this information useful and look forward to keeping you informed. Sincerely, J. Christopher Donahue, President Not FDIC Insured May Lose Value No Bank Guarantee

2 CONTENTS Portfolio of Investments Summary Table... 1 Financial Highlights... 7 Statement of Assets and Liabilities Statement of Operations Statement of Changes in Net Assets Notes to Financial Statements Shareholder Expense Example Evaluation and Approval of Advisory Contract Voting Proxies on Fund Portfolio Securities Quarterly Portfolio Schedule... 42

3 Portfolio of Investments Summary Table (unaudited) At April 30, 2018, the Fund s sector composition 1 wasasfollows: Percentage of Sector Composition Total Net Assets Financials 27.5% Health Care 13.0% Energy 11.3% IT Services 9.9% Consumer Staples 8.7% Industrials 8.4% Utilities 7.1% Consumer Discretionary 6.4% Telecommunication Services 3.8% Materials 1.8% Security Lending Collateral 2 1.1% Cash Equivalents 3 2.0% Other Assets and Liabilities Net 4 (1.0)% TOTAL 100.0% 1 Except for Cash Equivalents and Other Assets and Liabilities, sector classifications are based upon, and individual portfolio securities are assigned to, the classifications of the Global Industry Classification Standard (GICS) except that the Adviser assigns a classification to securities not classified by the GICS and to securities for which the Adviser does not have access to the classification made by the GICS. 2 Represents cash collateral received for portfolio securities on loan that may be invested in affiliated money market funds, other money market instruments and/or repurchase agreements. 3 Cash Equivalents include any investments in money market mutual funds and/or overnight repurchase agreements other than those representing cash collateral for securities lending. 4 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. 1

4 Portfolio of Investments April 30, 2018 (unaudited) Shares Value COMMON STOCKS 97.9% Consumer Discretionary 6.4% 138,324 Abercrombie & Fitch Co., Class A $ 3,543,861 54,084 Big Lots, Inc. 2,295,866 3,657 1 Burlington Stores 496, ,594 2 Dillard s Inc., Class A 9,139, ,685 Ford Motor Co. 8,550, ,695 Kohl s Corp. 8,056, ,251 Newell Brands, Inc. 5,173,745 65,744 Ralph Lauren Corp. 7,221,978 66,253 Royal Caribbean Cruises Ltd. 7,167, ,316 Target Corp. 27,828,742 78,027 Toll Brothers 3,289,618 TOTAL 82,764,661 Consumer Staples 8.7% 336,382 Campbell Soup Co. 13,717, ,819 Colgate-Palmolive Co. 14,338,793 65,530 CVS Health Corp. 4,575, ,333 JM Smucker Co. 23,196,229 82,780 1 Post Holdings, Inc. 6,586, ,987 Procter & Gamble Co. 28,573, ,411 Walgreens Boots Alliance, Inc. 21,357,761 TOTAL 112,346,565 Energy 11.3% 273,058 Chevron Corp. 34,162, ,723 ConocoPhillips 23,954, ,702 1, 2 Diamond Offshore Drilling, Inc. 2,624, ,096 2 Ensco PLC, Class A 5,447,142 23,589 EOG Resources, Inc. 2,787, ,263 Exxon Mobil Corp. 35,707,698 85,221 Murphy Oil Corp. 2,566,004 1,105,570 1 Noble Corp. PLC 5,163, ,876 Occidental Petroleum Corp. 14,669,820 50,248 1 Oil States International, Inc. 1,806, ,626 1 Rowan Companies PLC, Class A 2,781, ,995 Valero Energy Corp. 14,864,065 TOTAL 146,534,622 2

5 Shares Value COMMON STOCKS continued Financials 27.5% 52,026 Aflac, Inc. $ 2,370, ,377 Allstate Corp. 21,165,998 29,176 American Financial Group, Inc. 3,303,307 53,765 1 Arch Capital Group Ltd. 4,308, ,790 Assured Guaranty Ltd. 5,653,619 83,329 1 Athene Holding Ltd. 4,083, ,062 Bank of America Corp. 27,977, ,624 Citigroup, Inc. 15,949,511 42,670 Citizens Financial Group, Inc. 1,770, ,682 Comerica, Inc. 12,359, ,236 1 E*TRADE Financial Corp. 6,143,000 41,323 Everest Re Group Ltd. 9,614, ,693 Fifth Third Bancorp 26,326, ,347 First Horizon National Corp. 11,718, ,176 JPMorgan Chase & Co. 42,443, ,705 KeyCorp 5,093,644 2,027 1 Markel Corp. 2,290, ,264 Navient Corp. 3,623, ,025 Northern Trust Corp. 29,038,669 36,615 PNC Financial Services Group, Inc. 5,331, ,086 Popular, Inc. 6,854, ,411 Principal Financial Group, Inc. 15,480, ,108 Prudential Financial, Inc. 33,821, ,754 State Street Corp. 22,725, ,965 SunTrust Banks, Inc. 20,438, ,153 The Travelers Cos., Inc. 17,654,535 TOTAL 357,541,110 Health Care 13.0% 34,630 Allergan PLC 5,320, ,285 Baxter International, Inc. 34,005, ,067 Bristol-Myers Squibb Co. 8,604,943 90,717 1 Centene Corp. 9,850, ,119 1 Community Health Systems, Inc. 2,037,870 48,535 HCA Holdings, Inc. 4,646, ,326 Johnson & Johnson 33,814, ,511 Merck & Co., Inc. 23,931, ,120 Pfizer, Inc. 34,051,693 3

6 Shares Value COMMON STOCKS continued Health Care continued 119,584 Quest Diagnostics, Inc. $ 12,101,901 TOTAL 168,364,774 Industrials 8.4% 102,518 AGCO Corp. 6,425,828 98,496 Cummins, Inc. 15,745, ,065 Fluor Corp. 7,608, ,520 1 JetBlue Airways Corp. 2,255,209 81,512 Kennametal, Inc. 2,971, ,876 Old Dominion Freight Lines, Inc. 13,770, ,796 Owens Corning, Inc. 12,495, ,182 PACCAR, Inc. 23,887, ,599 Pitney Bowes, Inc. 1,508,462 33,923 Republic Services, Inc. 2,194, ,581 1 SPX Corp. 7,833,463 73,335 Stanley Black & Decker Inc. 10,383,503 39,270 1 WESCO International, Inc. 2,338,528 TOTAL 109,418,246 IT Services 9.9% 267,415 CA, Inc. 9,306, ,582 1 ebay, Inc. 9,378,406 1,262,652 HP, Inc. 27,134, ,212 Intel Corp. 33,667, ,751 Juniper Networks, Inc. 14,182,307 55,912 1 NCR Corp. 1,720, ,853 NetApp, Inc. 17,700, ,491 Vishay Intertechnology, Inc. 6,486, ,718 Western Digital Corp. 9,353,791 TOTAL 128,929,242 Materials 1.8% 23,088 Ashland Global Holdings, Inc. 1,527, ,636 Domtar, Corp. 5,910,520 21,906 Eastman Chemical Co. 2,236, ,441 Newmont Mining Corp. 14,358,177 TOTAL 24,032,826 Telecommunication Services 3.8% 737,728 AT&T, Inc. 24,123, ,965 1 T-Mobile US, Inc. 25,291,062 TOTAL 49,414,768 4

7 Shares Value COMMON STOCKS continued Utilities 7.1% 206,717 AES Corp. $ 2,530, ,799 Entergy Corp. 35,067, ,062 Exelon Corp. 5,398, ,013 NiSource, Inc. 15,951, ,282 1 PG&E Corp. 24,399, ,868 Pinnacle West Capital Corp. 8,361,374 TOTAL 91,709,108 TOTAL COMMON STOCKS (IDENTIFIED COST $1,172,336,524) 1,271,055,922 INVESTMENT COMPANIES 3.1% 12,106,252 Federated Government Obligations Fund, Premier Shares, 1.60% 3 12,106,252 28,745,151 Federated Institutional Prime Value Obligations Fund, Institutional Shares, 1.91% 3 28,745,151 TOTAL INVESTMENT COMPANIES (IDENTIFIED COST $40,848,892) 40,851,403 TOTAL INVESTMENT IN SECURITIES 101.0% (IDENTIFIED COST $1,213,185,416) 4 1,311,907,325 OTHER ASSETS AND LIABILITIES - NET (1.0)% 5 (14,408,150) TOTAL NET ASSETS 100% $1,297,499,175 Affiliated fund holdings are investment companies which are managed by the Adviser or an affiliate of the Adviser. Transactions with affiliated fund holdings during the six months ended April 30, 2018, were as follows: Federated Government Obligations Fund, Premier Shares* Federated Institutional Prime Value Obligations Fund, Institutional Shares* Total of Affiliated Transactions Balance of Shares Held 10/31/ ,853,250 13,853,250 Purchases/Additions 17,955, ,263, ,219,416 Sales/Reductions (5,849,317) (122,371,946) (128,221,263) Balance of Shares Held 4/30/ ,106,252 28,745,151 40,851,403 Value $12,106,252 $ 28,745,151 $ 40,851,403 Change in Unrealized Appreciation/Depreciation $ $ 1,955 $ 1,955 Net Realized Gain/(Loss) $ $ 1,766 $ 1,766 Dividend Income $ $ 165,247 $ 165,247 * All or a portion of the balance/activity for the fund relates to cash collateral received on security lending transactions. 1 Non-income-producing security. 2 All or a portion of this security is temporarily on loan to unaffiliated broker/dealers. 3 7-day net yield. 5

8 4 Also represents cost of investments for federal tax purposes. 5 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. Note: The categories of investments are shown as a percentage of total net assets at April 30, Various inputs are used in determining the value of the Fund s investments. These inputs are summarized in the three broad levels listed below: Level 1 quoted prices in active markets for identical securities. Level 2 other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). Also includes securities valued at amortized cost. Level 3 significant unobservable inputs (including the Fund s own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities. As of April 30, 2018, all investments of the Fund utilized Level 1 inputs in valuing the Fund s assets carried at fair value. 6

9 Financial Highlights Class A Shares (For a Share Outstanding Throughout Each Period) 1 Six Months Ended (unaudited) 4/30/2018 Year Ended October 31, Period Ended 10/31/ Net Asset Value, Beginning of Period $29.29 $26.09 $27.84 $29.89 $28.47 Income From Investment Operations: Net investment income (loss) Net realized and unrealized gain (loss) (0.00) TOTAL FROM INVESTMENT OPERATIONS Less Distributions: Distributions from net investment income (0.17) (0.40) (0.42) (0.36) (0.15) Distributions from net realized gain (2.48) (1.00) (1.91) (2.06) TOTAL DISTRIBUTIONS (2.65) (1.40) (2.33) (2.42) (0.15) Net Asset Value, End of Period $28.00 $29.29 $26.09 $27.84 $29.89 Total Return % 18.08% 2.47% 1.12% 5.51% Ratios to Average Net Assets: Net expenses 0.99% 6,7 0.99% 0.98% 0.99% 0.99% 6 Net investment income 1.18% % 1.65% 1.28% 1.04% 6 Expense waiver/reimbursement % % 0.22% 0.24% 0.26% 6 Supplemental Data: Net assets, end of period (000 omitted) $519,358 $24,237 $14,389 $12,035 $3,518 Portfolio turnover 35% 99% 88% 77% 34% 9 1 Federated MDT Large Cap Value Fund (the Predecessor Fund ) was reorganized into Federated MDT Large Cap Value Fund (the Fund ), a portfolio of the same name of Federated MDT Equity Trust, as of the close of business on December 8, The Fund is the successor to the Predecessor Fund. The performance information and financial information presented incorporates the operations of the Predecessor Fund, which, as a result of the reorganization, are the Fund s operations. 2 Reflects operations for the period from May 1, 2014 (date of initial investment) to October 31, Per share number has been calculated using the average shares method. 4 Represents less than $ Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. Total returns for periods less than one year are not annualized. 6 Computed on an annualized basis. 7 The net expense ratio is calculated without reduction for fees paid indirectly for expense offset arrangements. The net expense ratio is 0.99%, for the six months ended April 30, 2018, after taking into account this expense reduction. 8 This expense decrease is reflected in both the net expense and net investment income ratios shown above. 9 Portfolio turnover is calculated at the Fund level. Percentage indicated was calculated for the fiscal year ended October 31, See Notes which are an integral part of the Financial Statements 7

10 Financial Highlights Class B Shares (For a Share Outstanding Throughout the Period) Period Ended (unaudited) 4/30/ Net Asset Value, Beginning of Period $28.04 Income From Investment Operations: Net investment income (loss) Net realized and unrealized gain (loss) 0.02 TOTAL FROM INVESTMENT OPERATIONS 0.06 Less Distributions: Distributions from net investment income (0.09) Net Asset Value, End of Period $28.01 Total Return % Ratios to Average Net Assets: Net expenses 1.84% 4,5 Net investment income 0.29% 4 Expense waiver/reimbursement % 4 Supplemental Data: Net assets, end of period (000 omitted) $14,660 Portfolio turnover 35% 7 1 Reflects operations for the period December 8, 2017 (date of initial investment) to April 30, Per share number has been calculated using the average shares method. 3 Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. Total returns for periods of less than one year are not annualized. 4 Computed on an annualized basis. 5 The net expense ratio is calculated without reduction for fees paid indirectly for expense offset arrangements. The net expense ratio is 1.84%, for the period ended April 30, 2018, after taking into account this expense reduction. 6 This expense decrease is reflected in both the net expense and net investment income ratios shown above. 7 Portfolio turnover is calculated at the Fund level. Percentage indicated was calculated for the six months ended April 30, See Notes which are an integral part of the Financial Statements 8

11 Financial Highlights Class C Shares (For a Share Outstanding Throughout the Period) Period Ended (unaudited) 4/30/ Net Asset Value, Beginning of Period $28.04 Income From Investment Operations: Net investment income (loss) Net realized and unrealized gain (loss) 0.01 TOTAL FROM INVESTMENT OPERATIONS 0.06 Less Distributions: Distributions from net investment income (0.10) Net Asset Value, End of Period $28.00 Total Return % Ratios to Average Net Assets: Net expenses 1.79% 4,5 Net investment income 0.36% 4 Expense waiver/reimbursement % 4 Supplemental Data: Net assets, end of period (000 omitted) $26,514 Portfolio turnover 35% 7 1 Reflects operations for the period December 8, 2017 (date of initial investment) to April 30, Per share number has been calculated using the average shares method. 3 Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. Total returns for periods of less than one year are not annualized. 4 Computed on an annualized basis. 5 The net expense ratio is calculated without reduction for fees paid indirectly for expense offset arrangements. The net expense ratio is 1.79%, for the period ended April 30, 2018, after taking into account this expense reduction. 6 This expense decrease is reflected in both the net expense and net investment income ratios shown above. 7 Portfolio turnover is calculated at the Fund level. Percentage indicated was calculated for the six months ended April 30, See Notes which are an integral part of the Financial Statements 9

12 Financial Highlights Class R Shares (For a Share Outstanding Throughout the Period) Period Ended 4/30/ Net Asset Value, Beginning of Period $28.04 Income From Investment Operations: Net investment income (loss) Net realized and unrealized gain (loss) TOTAL FROM INVESTMENT OPERATIONS 0.10 Less Distributions: Distributions from net investment income (0.13) Net Asset Value, End of Period $28.01 Total Return % Ratios to Average Net Assets: Net expenses 1.43% 5,6 Net investment income 0.72% 5 Expense waiver/reimbursement % 5 Supplemental Data: Net assets, end of period (000 omitted) $19,112 Portfolio turnover 35% 8 1 Reflects operations for the period December 8, 2017 (date of initial investment) to April 30, Per share number has been calculated using the average shares method. 3 Represents less than $ Based on net asset value. Total returns for periods of less than one year are not annualized. 5 Computed on an annualized basis. 6 The net expense ratio is calculated without reduction for fees paid indirectly for expense offset arrangements. The net expense ratio is 1.43%, for the period ended April 30, 2018, after taking into account this expense reduction. 7 This expense decrease is reflected in both the net expense and net investment income ratios shown above. 8 Portfolio turnover is calculated at the Fund level. Percentage indicated was calculated for the six months ended April 30, See Notes which are an integral part of the Financial Statements 10

13 Financial Highlights Institutional Shares (For a Share Outstanding Throughout Each Period) 1 Six Months Ended (unaudited) Year Ended October 31, 4/30/ Net Asset Value, Beginning of Period $29.30 $26.10 $27.85 $29.90 $28.56 $22.30 Income From Investment Operations: Net investment income (loss) Net realized and unrealized gain (loss) (0.00) TOTAL FROM INVESTMENT OPERATIONS Less Distributions: Distributions from net investment income (0.19) (0.46) (0.47) (0.41) (0.34) (0.41) Distributions from net realized gain (2.48) (1.00) (1.91) (2.06) (3.23) (1.32) TOTAL DISTRIBUTIONS (2.67) (1.46) (2.38) (2.47) (3.57) (1.73) Net Asset Value, End of Period $28.02 $29.30 $26.10 $27.85 $29.90 $28.56 Total Return % 18.32% 2.70% 1.32% 18.93% 38.21% Ratios to Average Net Assets: Net expenses 0.77% 5,6 0.78% 0.76% 0.77% 0.77% 0.77% Net investment income 1.54% % 1.87% 1.50% 1.26% 1.62% Expense waiver/reimbursement % % 0.22% 0.22% 0.23% 0.24% Supplemental Data: Net assets, end of period (000 omitted) $413,962 $368,749 $241,699 $244,104 $165,122 $39,056 Portfolio turnover 35% 99% 88% 77% 34% 77% 1 Federated MDT Large Cap Value Fund (the Predecessor Fund ) was reorganized into Federated MDT Large Cap Value Fund (the Fund ), a portfolio of the same name of Federated MDT Equity Trust, as of the close of business on December 8, The Fund is the successor to the Predecessor Fund. The performance information and financial information presented incorporates the operations of the Predecessor Fund, which, as a result of the reorganization, are the Fund s operations. 2 Per share number has been calculated using the average shares method. 3 Represents less than $ Based on net asset value. Total returns for periods of less than one year are not annualized. 5 Computed on an annualized basis. 6 The net expense ratio is calculated without reduction for fees paid indirectly for expense offset arrangements. The net expense ratio is 0.77%, for the six months ended April 30, 2018, after taking into account this expense reduction. 7 This expense decrease is reflected in both the net expense and net investment income ratios shown above. See Notes which are an integral part of the Financial Statements 11

14 Financial Highlights Service Shares (For a Share Outstanding Throughout Each Period) 1 Six Months Ended (unaudited) Year Ended October 31, 4/30/ Net Asset Value, Beginning of Period $29.31 $26.11 $27.85 $29.90 $28.56 $22.31 Income From Investment Operations: Net investment income (loss) Net realized and unrealized gain (loss) (0.01) TOTAL FROM INVESTMENT OPERATIONS Less Distributions: Distributions from net investment income (0.16) (0.40) (0.42) (0.35) (0.28) (0.35) Distributions from net realized gain (2.48) (1.00) (1.91) (2.06) (3.23) (1.32) TOTAL DISTRIBUTIONS (2.64) (1.40) (2.33) (2.41) (3.51) (1.67) Net Asset Value, End of Period $28.03 $29.31 $26.11 $27.85 $29.90 $28.56 Total Return % 18.06% 2.50% 1.10% 18.68% 37.85% Ratios to Average Net Assets: Net expenses 0.99% 4,5 0.99% 0.98% 0.99% 0.99% 0.99% Net investment income 1.36% % 1.66% 1.28% 1.06% 1.39% Expense waiver/reimbursement % % 0.24% 0.23% 0.23% 0.25% Supplemental Data: Net assets, end of period (000 omitted) $247,192 $270,371 $251,246 $277,253 $313,714 $228,665 Portfolio turnover 35% 99% 88% 77% 34% 77% 1 Federated MDT Large Cap Value Fund (the Predecessor Fund ) was reorganized into Federated MDT Large Cap Value Fund (the Fund ), a portfolio of the same name of Federated MDT Equity Trust, as of the close of business on December 8, The Fund is the successor to the Predecessor Fund. The performance information and financial information presented incorporates the operations of the Predecessor Fund, which, as a result of the reorganization, are the Fund s operations. 2 Per share number has been calculated using the average shares method. 3 Based on net asset value. Total returns for periods of less than one year are not annualized. 4 Computed on an annualized basis. 5 The net expense ratio is calculated without reduction for fees paid indirectly for expense offset arrangements. The net expense ratio is 0.99%, for the six months ended April 30, 2018, after taking into account this expense reduction. 6 This expense decrease is reflected in both the net expense and net investment income ratios shown above. See Notes which are an integral part of the Financial Statements 12

15 Financial Highlights Class R6 Shares (For a Share Outstanding Throughout Each Period) 1 Six Months Ended (unaudited) 4/30/2018 Year Ended 10/31/2017 Period Ended 10/31/ Net Asset Value, Beginning of Period $29.31 $26.11 $24.51 Income From Investment Operations: Net investment income (loss) Net realized and unrealized gain (loss) TOTAL FROM INVESTMENT OPERATIONS Less Distributions: Distributions from net investment income (0.20) (0.48) (0.10) Distributions from net realized gain (2.48) (1.00) TOTAL DISTRIBUTIONS (2.68) (1.48) (0.10) Net Asset Value, End of Period $28.03 $29.31 $26.11 Total Return % 18.40% 6.95% Ratios to Average Net Assets: Net expenses 0.70% 5, % 0.69% 5 Net investment income 1.62% % 0.85% 5 Expense waiver/reimbursement % % 0.24% 5 Supplemental Data: Net assets, end of period (000 omitted) $56,700 $51,147 $28,838 Portfolio turnover 35% 99% 88% 8 1 Federated MDT Large Cap Value Fund (the Predecessor Fund ) was reorganized into Federated MDT Large Cap Value Fund (the Fund ), a portfolio of the same name of Federated MDT Equity Trust, as of the close of business on December 8, The Fund is the successor to the Predecessor Fund. The performance information and financial information presented incorporates the operations of the Predecessor Fund, which, as a result of the reorganization, are the Fund s operations. 2 Reflects operations for the period from June 29, 2016 (date of initial investment) to October 31, Per share number has been calculated using the average shares method. 4 Based on net asset value. Total returns for periods less than one year are not annualized. 5 Computed on an annualized basis. 6 The net expense ratio is calculated without reduction for fees paid indirectly for expense offset arrangements. The net expense ratio is 0.70%, for the six months ended April 30, 2018, after taking into account this expense reduction. 7 This expense decrease is reflected in both the net expense and net investment income ratios shown above. 8 Portfolio turnover is calculated at the Fund level. Percentage indicated was calculated for the fiscal year ended October 31, See Notes which are an integral part of the Financial Statements 13

16 Statement of Assets and Liabilities April 30, 2018 (unaudited) Assets: Total investment in securities, at value including $14,238,024 of securities loaned and $40,851,403 of investment in affiliated holdings (identified cost $1,213,185,416) $1,311,907,325 Receivable for investments sold 5,652,311 Income receivable 1,363,838 Receivable for shares sold 691,521 TOTAL ASSETS 1,319,614,995 Liabilities: Payable for collateral due to broker for securities lending $15,106,252 Payable for investments purchased 5,492,557 Payable for shares redeemed 867,958 Payable for other service fees (Notes 2 and 5) 280,184 Payable for distribution services fee (Note 5) 33,969 Payable for investment adviser fee (Note 5) 21,006 Payable for administrative fee (Note 5) 2,880 Payable for Directors /Trustees fees (Note 5) 466 Accrued expenses (Note 5) 310,548 TOTAL LIABILITIES 22,115,820 Net assets for 46,315,518 shares outstanding $1,297,499,175 Net Assets Consists of: Paid-in capital $1,149,731,330 Net unrealized appreciation 98,725,617 Accumulated net realized gain 48,404,886 Undistributed net investment income 637,342 TOTAL NET ASSETS $1,297,499,175 14

17 Statement of Assets and Liabilities continued Net Asset Value, Offering Price and Redemption Proceeds Per Share: Class A Shares: Net asset value per share ($519,357,925 18,547,738 shares outstanding), no par value, unlimited shares authorized $28.00 Offering price per share (100/94.50 of $28.00) $29.63 Redemption proceeds per share $28.00 Class B Shares: Net asset value per share ($14,660, ,477 shares outstanding), no par value, unlimited shares authorized $28.01 Offering price per share $28.01 Redemption proceeds per share (94.50/100 of $28.01) $26.47 Class C Shares: Net asset value per share ($26,514, ,790 shares outstanding), no par value, unlimited shares authorized $28.00 Offering price per share $28.00 Redemption proceeds per share (99/100 of $28.00) $27.72 Class R Shares: Net asset value per share ($19,112, ,273 shares outstanding), no par value, unlimited shares authorized $28.01 Offering price per share $28.01 Redemption proceeds per share $28.01 Institutional Shares: Net asset value per share ($413,962,402 14,774,402 shares outstanding), no par value, unlimited shares authorized $28.02 Offering price per share $28.02 Redemption proceeds per share $28.02 Service Shares: Net asset value per share ($247,192,051 8,818,104 shares outstanding), no par value, unlimited shares authorized $28.03 Offering price per share $28.03 Redemption proceeds per share $28.03 Class R6 Shares: Net asset value per share ($56,700,190 2,022,734 shares outstanding), no par value, unlimited shares authorized $28.03 Offering price per share $28.03 Redemption proceeds per share $28.03 See Notes which are an integral part of the Financial Statements 15

18 Statement of Operations Six Months Ended April 30, 2018 (unaudited) Investment Income: Dividends (including $165,247 received from an affiliated holding, see footnotes to the Portfolio of Investments and net of foreign taxes withheld of $7,596) $ 13,660,328 Interest 8,307 TOTAL INCOME 13,668,635 Expenses: Investment adviser fee (Note 5) $ 4,162,601 Administrative fee (Note 5) 484,621 Custodian fees 16,807 Transfer agent fees (Note 2) 763,691 Directors /Trustees fees (Note 5) 7,647 Auditing fees 17,762 Legal fees 5,710 Distribution services fee (Note 5) 168,460 Other service fees (Notes 2 and 5) 864,227 Portfolio accounting fees 89,119 Share registration costs 63,490 Printing and postage 43,471 Miscellaneous (Note 5) 22,492 TOTAL EXPENSES 6,710,098 Waiver, Reimbursements and Reduction: Waiver/reimbursement of investment adviser fee (Note 5) $(973,982) Reimbursements of other operating expenses (Notes 2 and 5) (136,950) Reduction of custodian fees (Note 6) (153) TOTAL WAIVER, REIMBURSEMENTS AND REDUCTION (1,111,085) Net expenses 5,599,013 Net investment income 8,069,622 Realized and Unrealized Gain (Loss) on Investments and Foreign Currency Transactions: Net realized gain on investments (including realized gain of $1,766 on sales of investments in an affiliated holding) 50,314,367 Net change in unrealized appreciation of investments and translation of assets and liabilities in foreign currency (including change in unrealized appreciation of $1,955 on investments in affiliated holdings) (19,097,242) Net realized and unrealized gain on investments and foreign currency transactions 31,217,125 Change in net assets resulting from operations $ 39,286,747 See Notes which are an integral part of the Financial Statements 16

19 Statement of Changes in Net Assets Six Months Ended (unaudited) 4/30/2018 Year Ended 10/31/2017 Increase (Decrease) in Net Assets Operations: Net investment income $ 8,069,622 $ 10,676,436 Net realized gain 50,314,367 59,229,425 Net change in unrealized appreciation/depreciation (19,097,242) 35,753,539 CHANGE IN NET ASSETS RESULTING FROM OPERATIONS 39,286, ,659,400 Distributions to Shareholders: Distributions from net investment income Class A Shares (3,204,630) (321,990) Class B Shares (54,717) Class C Shares (97,497) Class R Shares (95,711) Institutional Shares (2,992,569) (5,602,308) Service Shares (1,443,042) (3,941,158) Class R6 Shares (390,664) (706,805) Distributions from net realized gain Class A Shares (2,286,092) (582,450) Institutional Shares (30,891,533) (9,242,779) Service Shares (22,130,954) (9,406,860) Class R6 Shares (4,372,048) (1,137,901) CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS (67,959,457) (30,942,251) 17

20 Statement of Changes in Net Assets continued Six Months Ended (unaudited) 4/30/2018 Year Ended 10/31/2017 Share Transactions: Proceeds from sale of shares 88,383, ,791,625 Proceeds from shares issued in connection with the tax-free transfer of assets from Federated Clover Value Fund 685,573,710 Proceeds from shares issued in connection with the tax-free transfer of assets from Hancock Horizon Value Fund 150,708,500 Net asset value of shares issued to shareholders in payment of distributions declared 63,881,797 27,915,991 Cost of shares redeemed (226,170,917) (232,801,748) CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 611,668, ,614,368 Change in net assets 582,995, ,331,517 Net Assets: Beginning of period 714,503, ,172,141 End of period (including undistributed net investment income of $637,342 and $846,550, respectively) $1,297,499,175 $ 714,503,658 See Notes which are an integral part of the Financial Statements 18

21 Notes to Financial Statements April 30, 2018 (unaudited) 1. ORGANIZATION Federated MDT Equity Trust (the Trust ) was established as a Delaware statutory trust on July 12, 2017, and is registered under the Investment Company Act of 1940, as amended (the Act ), as an open-end management investment company. The Trust consists of one diversified portfolio, Federated MDT Large Cap Value Fund (the Fund ). The Fund offers seven classes of shares: Class A Shares, Class B Shares, Class C Shares, Class R Shares, Institutional Shares, Service Shares, and Class R6 Shares. Class T Shares are effective with the Securities and Exchange Commission (SEC) but, currently not being offered. All shares of the Fund have equal rights with respect to voting, except on class-specific matters. The Fund s investment objective is to provide growth of income and capital. On February 1, 2018, Class B Shares were closed to new purchases made by existing shareholders (excluding reinvestment of dividends and capital gains). In addition, on February 1, 2018, Class B Shares closed to inbound exchanges from Class B Shares of other Federated funds, and Class B Share exchanges are only permitted into Class B Shares of Federated Government Reserves Fund, an affiliated government money market fund, see Note 10. Effective December 8, 2017 the Fund became the successor fund (the Successor Fund ) to Federated MDT Large Cap Value Fund (a Massachusetts business trust of the same name) (the Predecessor Fund ) and assumed all of its net assets pursuant to a reorganization involving the Fund, the Predecessor Fund and Federated Clover Value Fund. At which time, the Fund also began offering Class B Shares, Class C Shares and Class R Shares. The Fund is the legal entity survivor and the Predecessor Fund is the accounting and tax survivor of the reorganization. Prior to December 8, 2017, the Fund had no investment operations and accordingly, the performance and financial information presented incorporates the operations of the Predecessor Fund, which, as a result of the reorganization, are the Fund s operations. On December 8, 2017, the Fund acquired all of the net assets of Federated Clover Value Fund (the Acquired Fund ), an open-end investment company in a tax-free reorganization, in exchange for Class A Shares, Class B Shares, Class C Shares, Class R Shares and Institutional Shares. In connection with the acquisition the Acquired Fund s Class A Shares, Class B Shares, Class C Shares, Class R Shares and Institutional Shares were exchanged for Class A Shares, Class B Share, Class C Shares, Class R Shares and Institutional Shares of the Fund. The purpose of the transaction was to combine two portfolios with comparable investment objectives and strategies. For financial reporting purposes, assets received and shares issued by the Fund were recorded at fair value; however, the cost basis of the investments received from the Acquired Fund was carried forward to align ongoing reporting of the Fund s realized and unrealized gains and losses with amounts distributable to shareholders for tax purposes. For every Institutional Share of the Acquired Fund exchanged, a shareholder of the Acquired Fund received approximately 0.81 of Institutional Shares of the Fund. For every Class A Share, Class B Share, Class C Share and Class R Share of the Acquired Fund exchanged, a shareholder of the Acquired Fund received approximately 0.81, 0.80, 0.80 and 0.81, respectively, of the same share Class of the Fund. 19

22 The Fund received net assets from the Acquired Fund as the result of the tax-free reorganization as follows: Shares of the Fund Issued Acquired Fund Net Assets Received Unrealized Appreciation+ Net Assets of the Fund Immediately Prior to Combination Net Assets of the Fund Immediately After Combination 24,464,295 $685,573,710 $33,264,582 $728,160,517 $1,413,734,227 + Unrealized Appreciation is included in the Acquired Fund Net Assets Received amount shown above. Assuming the acquisition had been completed on November 1, 2017, the beginning of the annual reporting period of the Fund, the Fund s pro forma results of operations for the six months ended April 30, 2018, are as follows: Net investment income* $ 9,058,862 Net realized and unrealized gain on investments $51,838,708 Net increase in assets resulting from operations $60,897,570 * Net investment income reflects $151,403 of pro forma eliminated expenses. Because the combined investment portfolios have been managed as a single integrated portfolio since the acquisition was completed, it is not practicable to separate the amount of revenue and earnings of the Acquired Fund that have been included in the Fund s Statement of Operations and Statement of Changes in Net Assets as of April 30, On January 27, 2017, the Fund acquired all of the net assets of Hancock Horizon Value Fund (the Hancock Acquired Fund ), an open-end investment company in a tax-free reorganization, in exchange for Institutional Shares and Service Shares of the Fund pursuant to a plan of reorganization approved by the Hancock Acquired Fund s Shareholders. In connection with the acquisition, the Hancock Acquired Fund s Institutional Class Shares were exchanged for Institutional Shares of the Fund and the Hancock Acquired Fund s ClassA Shares and Class C Shares were exchanged for Service Shares of the Fund. The purpose of the transaction was to combine two portfolios with comparable investment objectives and strategies. For financial reporting purposes, assets received and shares issued by the Fund were recorded at fair value; however, the cost basis of the investments received from the Hancock Acquired Fund was carried forward to align ongoing reporting of the Fund s realized and unrealized gains and losses with amounts distributable to shareholders for tax purposes. For every Institutional Class Share of the Hancock Acquired Fund exchanged, a shareholder of the Hancock Acquired Fund received approximately 0.86 of Institutional Shares of the Fund. For every Class A Share and Class C Share of the Hancock Acquired Fund exchanged, a shareholder of the Acquired Fund received approximately 0.85 and 0.82, respectively, of Service Shares of the Fund. 20

23 The Fund received net assets from the Hancock Acquired Fund as the result of the tax-free reorganization as follows: Shares of the Fund Issued Hancock Acquired Fund Net Assets Received Unrealized Appreciation + Net Assets of the Fund Immediately Prior to Combination Net Assets of the Fund Immediately After Combination 5,463,997 $150,708,500 $29,064,247 $587,440,550 $738,149,050 + Unrealized Appreciation is included in the Hancock Acquired Fund Net Assets Received amount shown above. Assuming the acquisition had been completed on November 1, 2016, the beginning of the annual reporting period of the Fund, the Fund s pro forma results of operations for the year ended October 31, 2017, are as follows: Net investment income* $ 5,466,507 Net realized and unrealized loss on investments $(84,477,336) Net decrease in assets resulting from operations $(79,010,829) * Net investment income reflects $115,774 of pro forma eliminated expenses. Because the combined investment portfolios have been managed as a single integrated portfolio since the acquisition was completed, it is not practicable to separate the amount of earnings of the Hancock Acquired Fund that has been included in the Fund s Statement of Changes in Net Assets as of October 31, 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 U.S. generally accepted accounting principles (GAAP). Investment Valuation In calculating its net asset value (NAV), the Fund generally values investments as follows: Equity securities listed on an exchange or traded through a regulated market system are valued at their last reported sale price or official closing price in their principal exchange or market. Fixed-income securities are fair valued using price evaluations provided by a pricing service approved by the Fund s Board of Trustees (the Trustees ). Shares of other mutual funds or non-exchange-traded investment companies are valued based upon their reported NAVs. Derivative contracts listed on exchanges are valued at their reported settlement or closing price, except that options are valued at the mean of closing bid and asked quotations. Over-the-counter (OTC) derivative contracts are fair valued using price evaluations provided by a pricing service approved by the Trustees. For securities that are fair valued in accordance with procedures established by and under the general supervision of the Trustees, certain factors may be considered such as: the last traded or purchase price of the security, information obtained by contacting the issuer or dealers, analysis of the issuer s financial statements or other available documents, fundamental analytical data, the nature and duration of restrictions on disposition, the movement of the market in which the security is normally traded, public trading in similar 21

24 securities or derivative contracts of the issuer or comparable issuers, movement of a relevant index, or other factors including but not limited to industry changes and relevant government actions. If any price, quotation, price evaluation or other pricing source is not readily available when the NAV is calculated, if the Fund cannot obtain price evaluations from a pricing service or from more than one dealer for an investment within a reasonable period of time as set forth in the Fund s valuation policies and procedures, or if information furnished by a pricing service, in the opinion of the valuation committee ( Valuation Committee ) is deemed not representative of fair value of such security, the Fund uses the fair value of the investment determined in accordance with the procedures described below. There can be no assurance that the Fund could obtain the fair value assigned to an investment if it sold the investment at approximately the time at which the Fund determines its NAV per share. Fair Valuation and Significant Events Procedures The Trustees have ultimate responsibility for determining the fair value of investments for which market quotations are not readily available. The Trustees have appointed a Valuation Committee comprised of officers of the Fund, Federated MDTA LLC (the Adviser ) and certain of the Adviser s affiliated companies to assist in determining fair value and in overseeing the calculation of the NAV. The Trustees have also authorized the use of pricing services recommended by the Valuation Committee to provide fair value evaluations of the current value of certain investments for purposes of calculating the NAV. The Valuation Committee employs various methods for reviewing third-party pricing-service evaluations including periodic reviews of third-party pricing services policies, procedures and valuation methods (including key inputs, methods, models and assumptions), transactional back-testing, comparisons of evaluations of different pricing services and review of price challenges by the Adviser based on recent market activity. In the event that market quotations and price evaluations are not available for an investment, the Valuation Committee determines the fair value of the investment in accordance with procedures adopted by the Trustees. The Trustees periodically review and approve the fair valuations made by the Valuation Committee and any changes made to the procedures. Factors considered by pricing services in evaluating an investment include the yields or prices of investments of comparable quality, coupon, maturity, call rights and other potential prepayments, terms and type, reported transactions, indications as to values from dealers and general market conditions. Some pricing services provide a single price evaluation reflecting the bid-side of the market for an investment (a bid evaluation). Other pricing services offer both bid evaluations and price evaluations indicative of a price between the prices bid and asked for the investment (a mid evaluation). The Fund normally uses bid evaluations for any U.S. Treasury and Agency securities, mortgage-backed securities and municipal securities. The Fund normally uses mid evaluations for any other types of fixed-income securities and any OTC derivative contracts. In the event that market quotations and price evaluations are not available for an investment, the fair value of the investment is determined in accordance with procedures adopted by the Trustees. The Trustees also have adopted procedures requiring an investment to be priced at its fair value whenever the Adviser determines that a significant event affecting the value of the investment has occurred between the time as of which the price of the investment would otherwise be determined and the time as of which the NAV is computed. An event is considered significant if there is both an affirmative expectation that the investment s value 22

25 will change in response to the event and a reasonable basis for quantifying the resulting change in value. Examples of significant events that may occur after the close of the principal market on which a security is traded, or after the time of a price evaluation provided by a pricing service or a dealer, include: With respect to securities traded principally in foreign markets, significant trends in U.S. equity markets or in the trading of foreign securities index futures contracts; Political or other developments affecting the economy or markets in which an issuer conducts its operations or its securities are traded; Announcements concerning matters such as acquisitions, recapitalizations, litigation developments, or a natural disaster affecting the issuer s operations or regulatory changes or market developments affecting the issuer s industry. The Trustees have adopted procedures whereby the Valuation Committee uses a pricing service to determine the fair value of equity securities traded principally in foreign markets when the Adviser determines that there has been a significant trend in the U.S. equity markets or in index futures trading. For other significant events, the Fund may seek to obtain more current quotations or price evaluations from alternative pricing sources. If a reliable alternative pricing source is not available, the Fund will determine the fair value of the investment in accordance with the fair valuation procedures approved by the Trustees. The Trustees have ultimate responsibility for any fair valuations made in response to a significant event. Repurchase Agreements The Fund may invest in repurchase agreements for short-term liquidity purposes. It is the policy of the Fund to require the other party to a repurchase agreement to transfer to the Fund s custodian or sub-custodian eligible securities or cash with a market value (after transaction costs) at least equal to the repurchase price to be paid under the repurchase agreement. The eligible securities are transferred to accounts with the custodian or subcustodian in which the Fund holds a securities entitlement and exercises control as those terms are defined in the Uniform Commercial Code. The Fund has established procedures for monitoring the market value of the transferred securities and requiring the transfer of additional eligible securities if necessary to equal at least the repurchase price. These procedures also allow the other party to require securities to be transferred from the account to the extent that their market value exceeds the repurchase price or in exchange for other eligible securities of equivalent market value. The insolvency of the other party or other failure to repurchase the securities may delay the disposition of the underlying securities or cause the Fund to receive less than the full repurchase price. Under the terms of the repurchase agreement, any amounts received by the Fund in excess of the repurchase price and related transaction costs must be remitted to the other party. The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub-custodian for investment companies and other clients advised by the Adviser and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities. 23

26 Investment Income, Gains and Losses, Expenses and Distributions Investment transactions are accounted for on a trade-date basis. Realized gains and losses from investment transactions are recorded on an identified-cost basis. Interest income and expenses are accrued daily. Dividend income and distributions to shareholders are recorded on the ex-dividend date. Distributions of net investment income, if any, are declared and paid quarterly. Non-cash dividends included in dividend income, if any, are recorded at fair value. Amortization/accretion of premium and discount is included in investment income. Investment income, realized and unrealized gains and losses, and certain fund-level expenses are allocated to each class based on relative average daily net assets, except that select classes will bear certain expenses unique to those classes. The detail of the total fund expense waiver, reimbursements and reduction of $1,111,085 is disclosed in various locations in this Note 2, Note 5 and Note 6. For the six months ended April 30, 2018, transfer agent fees for the Fund were as follows: Transfer Agent Fees Incurred Transfer Agent Fees Reimbursed Class A Shares $270,783 $ (83,581) Class B Shares 12,105 (48) Class C Shares 16,093 Class R Shares 25,579 (2,340) Institutional Shares 274,299 (31,679) Service Shares 152,856 (19,302) Class R6 Shares 11,976 TOTAL $763,691 $(136,950) Dividends are declared separately for each class. No class has preferential dividend rights; differences in per share dividend rates are generally due to differences in separate class expenses. Other Service Fees The Fund may pay other service fees up to 0.25% of the average daily net assets of the Fund s Class A Shares, Class B Shares, Class C Shares and Service Shares to unaffiliated financial intermediaries or to Federated Shareholder Services Company (FSSC) for providing services to shareholders and maintaining shareholder accounts. Financial intermediaries may include a company affiliated with management of Federated Investors, Inc. Subject to the terms described in the Expense Limitation note, FSSC may voluntarily reimburse the Fund for other service fees. For the six months ended April 30, 2018, other service fees for the Fund were as follows: Other Service Fees Incurred Class A Shares $525,780 Class B Shares 15,524 Class C Shares 27,180 Service Shares 295,743 TOTAL $864,227 24

27 Federal Taxes It is the Fund s policy to comply with the Subchapter M provision of the Internal Revenue Code and to distribute to shareholders each year substantially all of its income. Accordingly, no provision for federal income tax is necessary. As of and during the six months ended April 30, 2018, the Fund did not have a liability for any uncertain tax positions. The Fund recognizes interest and penalties, if any, related to tax liabilities as income tax expense in the Statement of Operations. As of April 30, 2018, tax years 2014 through 2017 remain subject to examination by the Fund s major tax jurisdictions, which include the United States of America and the Commonwealth of Massachusetts. The Fund may be subject to taxes imposed by governments of countries in which it invests. Such taxes are generally based on either income or gains earned or repatriated. The Fund accrues and applies such taxes to net investment income, net realized gains and net unrealized gains as income and/or gains are earned. 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. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract. Securities Lending The Fund participates in a securities lending program providing for the lending of equity securities to qualified brokers. The term of the loans within the program is one year or less. The Fund normally receives cash collateral for securities loaned that may be invested in affiliated money market funds, other money market instruments and/or repurchase agreements. Investments in money market funds may include funds with a floating NAV that can impose redemption fees and liquidity gates, impose certain operational impediments to investing cash collateral, and, if the investee fund s NAV decreases, result in the Fund recognizing losses and being required to cover the decrease in the value of the cash collateral. Collateral is maintained at a minimum level of 100% of the market value of investments loaned, plus interest, if applicable. Earnings on collateral are allocated between the securities lending agent, as a fee for its services under the program, and the Fund, according to agreed-upon rates. The securities lending agreement permits the net settlement of all transactions and collateral with the Fund, through a single payment, in the event of default or termination. Amounts presented on the Portfolio of Investments and Statement of Assets and Liabilities are not net settlement amounts, but gross. The cash collateral received by the Fund exceeds the market value of the securities loaned, reducing the net settlement amount to zero. Additionally, the securities lending agreement executed by the Fund includes an indemnification clause. 25