Fund Evaluator:
Federated Hermes MDT Market Neutral IS (QQMNX)
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Best Performing in Equity Market Neutral Over the Last Year
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Fund Details
Federated Hermes MDT Market Neutral IS Overview
Federated Hermes MDT Market Neutral IS (QQMNX) is an actively managed Alternative Equity Market Neutral fund. Federated launched the fund in 2008.
The investment seeks to provide long-term capital appreciation while limiting exposure to general stock market risk. The fund seeks to achieve its objective by selecting long positions in publicly traded common stocks which its quantitative model predicts will achieve above-market returns, and short positions in publicly traded common stocks which the fund’s quantitative model predicts will achieve below-market returns. The Adviser will attempt to realize investment gains on both the long and short sides of its investment strategies through stock selection.
About Federated Hermes MDT Market Neutral IS (QQMNX)
There are 4 members of the management team with an average tenure of 4.93 years: Frederick Konopka (2021), Daniel Mahr (2021), John Lewicke (2021), Damien Zhang (2021). Management tenure is more important for actively managed funds than passive index funds.
The fund has 2 primary benchmarks: Russell 3000 TR USD index with a weighting of 100% and ICE BofA US 3M Trsy Bill TR USD index with a weighting of 100%. Federated Hermes MDT Market Neutral IS has 400 securities in its portfolio. The top 10 holdings constitute 28.5% of the fund’s assets. The fund meets the SEC requirement of being classified as a diversified fund. The fund is not considered to have an ESG focus with its investment selection and management.
Federated Hermes MDT Market Neutral IS is part of the Alternative Strategies global asset class and is within the Alternative fund group. Federated Hermes MDT Market Neutral IS has -1.2% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 21.1%. There is -1.2% 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 MDT Market Neutral IS has 74.6% of the portfolio in cash.
Assets Under Management
The fund has $2 billion in total assets, which is above the $666 million average for the Equity Market Neutral 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.
QQMNX 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 MDT Market Neutral IS expense ratio is high compared to funds in the Equity Market Neutral category. Federated Hermes MDT Market Neutral IS has an expense ratio of 2.11%, which is 6% higher than its category average, making the fund expense ratio grade a D. 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 MDT Market Neutral IS has a portfolio turnover rate of 62%, indicating that holds its assets around 0.0 years. By way of comparison, the average portfolio turnover is 144% for the Equity Market Neutral category.
Recently, in the month of August 2026, Federated Hermes MDT Market Neutral IS returned 1.1%, which earned it a grade of A, as the Equity Market Neutral category had an average return of -0.0%. 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 MDT Market Neutral IS has a trailing yield of 1.64%, which is below the 2.51% category average. The fund normally distributes its income annually and its capital gains 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 MDT Market Neutral IS Grades
Year to date, the fund has returned 6.2%, 1.6 percentage points better than the category, which translates into a grade of B. The fund has returned 10.7% over the past year (grade of B), 12.1% over the past three years (grade of B) and 11.7% per year over the past five years (grade of B) and 8.1% per year over the past 10 years (grade of A).
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QQMNX Trailing NAV Total Returns Data as of 8/31/26
| Last Month |
Last Quarter |
Ann'l. 1Yr |
Ann'l. 3Yr |
Ann'l. 5Yr |
Ann'l. 10Yr |
|
| QQMNX Return (NAV) | 1.1% | 6.2% | 10.7% | 12.1% | 11.7% | 8.1% |
| QQMNX Grade | A | A | B | B | B | A |
| +/- Category | 1.1% | 3.5% | 1.9% | 2.2% | 3.4% | 3.1% |
| Equity Market Neutral Avg | -0.0% | 2.7% | 8.8% | 9.9% | 8.3% | 5.0% |
| QQMNX Tax Cost Ratio | na | na | 0.6% | 0.8% | 3.1% | 1.8% |
QQMNX Annual NAV Total ReturnsData as of 8/31/26
| 2026 | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | |
| QQMNX Return (NAV) | 6.2% | 10.3% | 17.6% | 5.0% | 9.5% | 23.0% | -3.7% | 11.5% | -5.6% | 7.7% | 3.5% |
| QQMNX Grade | B | B | B | D | B | A | D | A | F | A | B |
| +/- Category | 1.6% | -0.2% | 7.8% | -3.3% | 4.9% | 16.1% | -2.1% | 9.7% | -5.2% | 2.0% | 2.9% |
| Equity Market Neutral Avg | 4.6% | 10.5% | 9.8% | 8.3% | 4.5% | 6.9% | -1.6% | 1.7% | -0.4% | 5.7% | 0.6% |
| Risk Measures | |
| Standard Deviation: | 5.6% |
| Total Risk Index: | 0.46 - Low |
| Category Risk Index: | 1.01 - Above Average |
| Category Risk Grade: | D (72% Rank) |
| Beta: | -0.08 |
| R-Squared: | 3% |
| Leveraged Fund: | No |
| Inverse Fund: | No |
| Portfolio Characteristics | |
| Equity Investment Style: | Mid-Cap Blend |
| Bond Investment Style: | na |
| Yield: | 1.6% |
| Dividend Distribution: | Annually |
| Cap Gains Distribution: | Annually |
| Total Assets: | $2607 Mil |
| Fund Total Assets: | $2,361 Mil |
| Share Class Type: | Inst |
| Portfolio Turnover: | 62% |
Management Team
| Number of Managers: 4 | |||
| Longest Tenure: 4.9 years | |||
| Average Tenure: 4.9 years | |||
| Managers (Year): Konopka Frederick (2021), Mahr Daniel (2021), Lewicke John (2021), Zhang Damien (2021) | |||
Portfolio Composition (as of 6/30/26)
| # of Holdings: | 400 |
| % in Top 10 Holdings: | 28.5% |
| Fund is Non-Diversified: | No |
| % in Foreign Issues: | -1.2% |
Portfolio Allocation |
|
| Domestic Stock: | 21.1% |
| Foreign Stock: | -1.2% |
| Preferred Stock: | 0.0% |
| Domestic Bond: | 0.0% |
| Foreign Bond: | 0.0% |
| Convertible Bond: | 0.0% |
| Other: | 5.5% |
| Cash: | 74.6% |
Purchase Information
| Fund Family: | Federated |
| Phone Number: | 800-341-7400 |
| Website: | www.FederatedInvestors.com |
| Status: | Open |
| Inception Date: | September 30, 2008 |
| Min. Initial Purchase: | $1,000,000 |
| Min. Initial IRA Purchase: | $ 0 |
| True No-Load: | Yes |
| Front Load Maximum: | 0.00% |
| Deferred Charge Maximum: | 0.00% |
| Redemption Charge Maximum: | 0.00% |
| 12b-1 Fee: | na |
Expenses and Fees | |
| Expense Ratio (%): | 2.11% ( Rating : High ) |
| Category Average Expense Ratio (%): | 1.98% |
| Share Class: | Federated Hermes MDT Market Neutral IS |
| Min. Subsequent Purchase: | $ 100 |
| Min. Subsequent IRA Purchase: | $ 0 |
