Concentration Risk

(a) Revenue Concentration by Asset Class

The following table summarizes the percentage of total revenue earned from Federated's asset classes for the periods presented:



	Six Months Ended
	June 30,
	2018		2017
Equity Assets	44	%	42	%
Money Market Assets	39	%	41	%
Fixed-Income Assets	17	%	17	%

The change in the relative proportion of Federated's revenue attributable to equity assets for the first six months of 2018 as compared to the same period in 2017 was primarily the result of higher average equity assets.

The change in the relative proportion of Federated's revenue attributable to money market assets for the first six months of 2018 as compared to the same period in 2017 was primarily the result of a change in the mix of average money market assets and a decrease related to a January 2017 change in a customer relationship.

Current Regulatory Environment

Federated and its investment management business are subject to extensive regulation in the U.S. and abroad. Federated and its products, such as the Federated Funds, and strategies are subject to: federal securities laws, principally the Securities Act of 1933 (1933 Act), the Securities Exchange Act of 1934 (1934 Act), the 1940 Act, the Investment Advisers Act of 1940; state laws regarding securities fraud and registration; regulations or other rules, promulgated by various regulatory authorities, self-regulatory organizations or exchanges; and foreign laws, regulations or other rules promulgated by foreign regulatory or other authorities.

See the Business Developments - Current Regulatory Environment section of Management's Discussion and Analysis for additional information about the current regulatory environment.

(b) Revenue Concentration by Investment Strategy/Fund

The following table presents Federated's revenue concentration by investment strategy/fund:



	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2018		2017		2018		2017
Federated Strategic Value Dividend strategy¹	16	%	18	%	17	%	18	%
Federated Kaufmann Mid-Cap Growth strategy²	11	%	9	%	11	%	8	%
Federated Government Obligations Fund	10	%	10	%	10	%	10	%

1Strategy includes Federated Funds and Separate Accounts.

2 Strategy includes Federated Funds.

A significant and prolonged decline in the AUM in any of these strategies/funds could have a material adverse effect on Federated's future revenues and, to a lesser extent, net income, due to a related reduction in distribution expenses associated with the Federated Funds managed in accordance with these strategies/funds.

Approximately 14% of Federated's total revenue for both the three- and six-month periods ended June 30, 2018 and 17% and 16% for the three- and six-month periods ended June 30, 2017, respectively, was derived from services provided to one intermediary, The Bank of New York Mellon Corporation, including its Pershing subsidiary. Significant negative changes in Federated's relationship with this intermediary could have a material adverse effect on Federated's future revenues and, to a lesser extent, net income due to a related reduction in distribution expenses associated with this intermediary.