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Federated Hermes

Federated Hermes Parent Rating

Average

Federated Hermes demonstrates strength in fixed-income investing and is developing as an ESG manager, but weak spots remain.

It maintains an Average Parent rating.

Federated Hermes' diverse product lineup supports patience in tumultuous markets. Its money market business grew meaningfully during the recent period of rising interest rates, which helped offset underperformance and outflows from its equity and fixed-income divisions. As a result, while some of the firm's peers reduced headcount, Federated Hermes generally kept its talent through the turbulence.

The firm continues to integrate with sustainable investing shop Hermes Investment Management, which it acquired in 2021. Over the past few years, the firm has improved investors' use of environmental and social factors, and it continues to develop new sustainability-focused offerings, mostly for European clients.

Still, Federated Hermes has more to do to stay competitive. Some equity groups have struggled with personnel turnover and volatile performance, and while the firm is taking steps to remedy this, it remains to be seen how these changes play out. It was also slow to launch ETFs, which quickly became the top choice for new products in the US but constitute a tiny portion of the firm's assets under management. Finally, it faces pressure from fee compression; nearly half its share classes sport High or Above Average expenses.

Federated Hermes Investments

Market

US Open-end ex MM ex FoF ex Feeder

Total Net Assets

69.12 Bil

Investment Flows (TTM)

−5.48 Bil

Asset Growth Rate (TTM)

−7.90%

# of Share Classes

217
Morningstar Rating # of Share Classes
13
41
94
54
7
Not Rated 8

Exchange-Traded Funds

See All Federated Hermes ETFs

Market

US ETFs

Total Net Assets

251.34 Mil

Investment Flows (TTM)

109.80 Mil

Asset Growth Rate (TTM)

98.09%

# of Share Classes

4
Morningstar Rating # of Share Classes
0
0
0
0
0
Not Rated 4

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