Fund Evaluator:

Federated Hermes SDG Engagement Eq A Overview

Federated Hermes SDG Engagement Eq A (FHEQX) is an actively managed International Equity Global Small/Mid Stock fund. Federated launched the fund in 2019.

The investment seeks to provide long term capital appreciation alongside positive societal impact. The sub-adviser pursues the fund investment objective of long-term capital appreciation alongside positive societal impact by investing, normally, at least 80% of its net assets in equity securities. The fund's investment adviser or sub-adviser anticipates that the fund will be primarily invested in equity securities and equity-related securities (such as depositary receipts) of small- and mid-capitalization companies in both the United States and foreign markets (including emerging markets).

About Federated Hermes SDG Engagement Eq A (FHEQX)

There are 2 members of the management team with an average tenure of 4.17 years: Mark Sherlock (2025), Hamish Galpin (2018). Management tenure is more important for actively managed funds than passive index funds.

The fund has 2 primary benchmarks: MSCI ACWI NR USD index with a weighting of 100% and MSCI ACWI SMID NR USD index with a weighting of 100%. Federated Hermes SDG Engagement Eq A has 56 securities in its portfolio. The top 10 holdings constitute 29.0% of the fund’s assets. The fund meets the SEC requirement of being classified as a diversified fund. The fund is considered to have an ESG focus with its investment selection and management.

Federated Hermes SDG Engagement Eq A is part of the Equity global asset class and is within the International Equity fund group. Federated Hermes SDG Engagement Eq A has 40.7% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 57.7%. There is 40.7% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 0.0% (0.0% domestic bond, 0.0% foreign bond and 0.0% convertible bond). Federated Hermes SDG Engagement Eq A has 0.0% of the portfolio in cash.

Assets Under Management

The fund has $797 million in total assets, which is below the $892 million average for the Global Small/Mid Stock category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

FHEQX Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Federated Hermes SDG Engagement Eq A expense ratio is high compared to funds in the Global Small/Mid Stock category. Federated Hermes SDG Engagement Eq A has an expense ratio of 1.19%, which is 5% lower than its category average, making the fund expense ratio grade a C. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. Federated Hermes SDG Engagement Eq A has a portfolio turnover rate of 24%, indicating that holds its assets around 0.0 years. By way of comparison, the average portfolio turnover is 57% for the Global Small/Mid Stock category.

Recently, in the month of July 2026, Federated Hermes SDG Engagement Eq A returned -1.4%, which earned it a grade of C, as the Global Small/Mid Stock category had an average return of -2.0%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all funds in that category.

Federated Hermes SDG Engagement Eq A has a trailing yield of 0.72%, which is below the 1.34% category average. The fund normally distributes its income annually.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

Federated Hermes SDG Engagement Eq A Grades

Year to date, the fund has returned 10.4%, 0.5 percentage points worse than the category, which translates into a grade of C. The fund has returned 12.5% over the past year (grade of D), 6.6% over the past three years (grade of D) and 3.3% per year over the past five years (grade of C).

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