Federated Hermes Kaufmann Large Cap IS KLCIX Fund Analysis

Federated Hermes announced on June 20, 2024, that financials-focused manager Mark Bauknight will retire from Federated Hermes Kaufmann Large Cap and Federated Hermes Kaufmann effective Sept. 30, 2024. The change does not affect the funds' Average People ratings or their Morningstar Analyst Ratings of Neutral or Negative, depending on share-class fees. Bauknight's experience will be missed, and it's unclear who will take over his coverage of financial-services firms. He joined the Kaufmann team in 1997 and became a comanager on Federated Hermes Kaufmann in October 2003 before being named a comanager on Federated Hermes Kaufmann Large Cap in December 2007. While financials tend to be a relatively small cut of the portfolios' assets—often less than 10% of each portfolio—the uncertainty surrounding the coverage change bears watching and underpins the disruptive nature of personnel changes given the team's sector-focused approach and lack of a succession plan. Despite the concerns, the rest of the team is adequate; seven managers averaging more than 30 years of industry experience remain.