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Fixed Income Taxable

Multi-Manager Emerging Markets Debt Opportunity

 
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TickerNAV AS OF 10/31/14
NMEDX$10.02 $-0.03 Arrow Down Icon
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Snapshot
The Multi-Manager Emerging Markets Debt Opportunity Fund may be a good choice for those long-term investors seeking exposure to emerging or frontier markets debt issuers. The Fund may invest in sovereign issuers and companies of any size located in a number of countries throughout the world and in securities denominated in foreign currencies and in U.S. dollars. Our approach blends specialist managers selected from a broad universe of external global managers into a single fund. Each Sub-Adviser acts independently from the others and utilizes its own distinct investment style in selecting securities while seeking total return through both current income and capital appreciation.
Fund Objective
Total return through both income and capital appreciation
Initial Investment Minimum
$100,000
Fund Strategy
  • Invest at least 80% of net assets in fixed income securities that provide exposure to issuers tied to emerging or frontier markets. The Fund's investments provide exposure to a blend of local and hard currency emerging markets debt and opportunistically invest in emerging market corporate bonds.
  • Select complementary managers from a broad universe of investment managers.
  • Blend managers into a single fund in an effort to provide an attractive combination of risk/return.
Investor Profile
If you're a long-term investor looking to diversify your investments by pursuing the income potential of emerging or frontier markets debt issuers, then this Fund may be right for you. It is intended for investors who are aware that foreign markets may involve additional risks, such as social and political instability, reduced market liquidity and currency volatility.
Redemption Fee
2% on shares sold or exchanged within 30 days of purchase
Risk/Reward Potential
”Risk/Reward
Sub-Adviser Allocations

Sub-Advisers and Allocations subject to change at any time.

SUB-ADVISERTARGET ALLOCATIONROLE IN PORTFOLIO
Bluebay Asset Management LLP 50% Fundamental, bottom-up country analysis and selection focus. Relative value analysis then determines trade-offs between potential investments and risk management.
Lazard Asset Management LLC 50% Top down approach that begins with an assessment of the global macro environment, followed by bottom-up analysis of individual countries.
Important risk information can be found on the Portfolio tab.
CUSIP665162343
YTD Total Return3.02% (as of 10/31/14)
Distribution Rate*N/A (as of 10/31/14)
30-Day SEC Yield w/ Waivers*5.08% (as of 09/30/14)
30-Day SEC Yield w/o Waivers*4.76% (as of 09/30/14)
Inception Date12/03/13
Total Net Assets$132,294,519 (as of 09/30/14)
Tax-Equivalent Distribution Rate*N/A
Tax-Equivalent 30-Day SEC Yield*N/A
*Distribution rate and tax-equivalent distribution rate represent the annualization of the Fund's distributions for the prior month ending on the date shown, including capital gain distributions. The 30-day SEC yield and tax-equivalent 30-day SEC yield represent the annualization of the Fund's net investment income, excluding capital gain income. The tax-equivalent distribution rate and tax-equivalent 30-day SEC yield are based on an assumed tax rate of 47.9% for Arizona, 55.7% for California and 43.4% for national municipal funds.

Total Returns

Total Returns for Quarter Ending 09/30/14
 Annualized
    Month   3-Month     YTD  1-Year  3-Year  5-Year  10-Year Since
Incept.
Multi-Manager Emerging
Markets Debt Opportunity
-3.68%-4.05%2.09%N/AN/AN/AN/A2.60%
50% JP Morgan EMBI
Global Diversified
and 50% JP Morgan GBI-EM
Global Diversified
-3.46%-3.14%3.98%N/AN/AN/AN/A4.63%
Morningstar Cat. Avg.
Emerging Markets Bond
-3.02%-2.92%3.36%N/AN/AN/AN/AN/A
Performance quoted represents past performance and does not guarantee future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than that shown here.

The Advisor has agreed to reimburse certain expenses of the Fund (excluding acquired fund fees and expenses; a portion of the compensation paid to each Trustee who is not an officer, director or employee of Northern Trust Corporation or its subsidiaries; expenses related to third-party consultants engaged by the Board of Trustees of the Trust; membership dues paid to the Investment Company Institute and Mutual Fund Directors Forum; extraordinary expenses; and interest, if any) to the extent the "Total Annual Fund Operating Expenses" exceed 0.93%. The contractual limitation may not be terminated before July 31, 2015 without the approval of the Board of Trustees. In the absence of fee waivers, yield, total return, growth since inception and dividends would have been reduced. Total return is based on net change in NAV assuming reinvestment of distributions.

Annual Expense Ratios

 
 Gross Expense RatioNet Expense Ratio
Multi-Manager Emerging Markets Debt Opportunity1.29%0.97%
Includes contractual expense reimbursements that, if not extended, will end on July 31, 2015.

Calendar Year Returns

 
 2013
Multi-Manager Emerging Markets Debt OpportunityN/A
50% JP Morgan EMBI Global Diversified and 50% JP Morgan GBI-EM Global DiversifiedN/A
Morningstar Category Avg. Emerging Markets BondN/A
Performance quoted represents past performance and does not guarantee future results.
Important risk information can be found on the Portfolio tab.
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Portfolio Composition
  
Maturity DistributionFund
0 - 3 Years15.2%
3 - 5 Years13.4%
5 - 7 Years10.3%
7 - 10 Years25.7%
10+ Years35.4%
TOTAL100.0%
As of 09/30/14
Quality DistributionFundBenchmark
AA0.5%2.3%
A14.1%18.5%
BBB30.1%51.6%
BB17.0%16.8%
B9.2%3.7%
CCC or below5.2%5.8%
Not Rated23.9%1.3%
TOTAL100.0%100.0%
Sector WeightingsFundBenchmark
Emerging Markets Debt69.1%94.3%
Short-Term19.3%0.0%
High Yield Corporate9.3%2.0%
Foreign1.2%0.0%
Investment Grade Corporate1.1%3.7%
TOTAL100.0%100.0%
DateHoldings File
As of 09/30/14Insert Icon
As of 06/30/14Insert Icon

Fund Characteristics

Number of Holdings290
Average Duration4.7 YRS
Average Maturity7.3 YRS
Weighted Average Coupon3.26%
Yield to Maturity5.42%
Income**N/A
Dividend ScheduleQuarterly
Dividend Income Last Quarter$0.0889
Capital Gain Income Last QuarterN/A
Benchmark50% JP Morgan Emerging Markets Bond Index Global Diversified
(EMBI Global Diversified) and 50% JP Morgan Government
Bond-Emerging Market Index Global Diversified
(GBI-EM Global Diversified)
Morningstar CategoryEmerging Markets Bond
All data is as of date indicated and subject to change.
Bond Risk: Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer-term issues and in environments of rising interest rates.
Credit/Default Risk: is the risk that the inability or unwillingness of an issuer or guarantor of a fixed-income security to meet its payment or other financial obligations will adversely affect the value of the Fund's investments and its returns. Changes in the credit rating of a debt security held by the Fund could have a similar effect.
Currency Risk: Foreign currencies will fluctuate in value relative to the U.S. dollar; therefore you may lose money if the local currency of a foreign market depreciates against the U.S. dollar.
Emerging and Frontier Markets Risk: Emerging and frontier market investing may be subject to additional economic, political, liquidity and currency risks not associated with more developed countries. Additionally, frontier countries generally have smaller economies or less developed capital markets than traditional emerging markets and, as a result, the risks of investing in emerging market countries are magnified in frontier countries.
Foreign (Non-U.S.) Securities Risk: Investing in foreign (non-U.S.) securities may result in the Fund experiencing more rapid and extreme changes in value than a fund that invests exclusively in securities of U.S. companies, due to less liquid markets, foreign government intervention and adverse economic, political, diplomatic, financial and regulatory factors.
High-Yield Risk: Although a high-yield fund's yield may be higher than that of fixed-income funds that purchase higher-rated securities, the potentially higher yield is a function of the greater risk that a high-yield fund’s share price will decline.
Interest Rate Risk: Increases in prevailing interest rates will cause fixed-income securities, including convertible securities, held by the Fund to decline in value.
Liquidity Risk: Some securities held by the Fund may be difficult to sell, or illiquid, particularly during times of market turmoil. Illiquid securities also may be difficult to value. If the Fund is forced to sell an illiquid asset to meet redemption requests or other cash needs, the Fund may be forced to sell at a loss.
Non-Diversified Risk: The Fund invests in a smaller number of securities than the average mutual fund. The change in value of a single holding may have a more pronounced effect on the Fund’s net asset value and performance than for other funds.

JP Morgan Emerging Markets Bond Index Global Diversified (EMBI Global Diversified) is a uniquely weighted USD-denominated emerging markets sovereign bond index. The EMBI Global Diversified has the same instrument composition as the market-capitalization weighted EMBI Global, which includes USD-denominated fixed and floating rate instruments issued by sovereign and quasi-sovereign entities. The EMBI Global Diversified limits the weights of the index countries by only including a specified portion of those countries' eligible current face amounts of debt outstanding. It is not possible to invest directly in an index.

JP Morgan Government Bond-Emerging Market Index Global Diversified (GBI-EM Global Diversified) tracks the performance of local currency debt issued by emerging market governments. The index incorporates a constrained market-capitalization methodology in which individual issuer exposures are capped at 10% (with the excess distributed to smaller issuers), for greater diversification among issuing governments. It is not possible to invest directly in an index.
Quality Distribution: Credit quality ratings are compiled from two external rating agencies: Moody's and Standard & Poor's. We report the lowest rating of the two in the event there are any differences between them. If neither of these rating agencies has assigned a rating, the Fund will assign a rating of not rated. The ratings, expressed in Standard & Poor's nomenclature, range from AAA (extremely strong capacity to meet its financial commitment) to D (in default). Short-term ratings, expressed in Standard & Poor's nomenclature, range from A-1 (obligor's capacity to meet its financial commitment on the obligation is strong) to A-3 (exhibits adequate protection parameters). Government securities consist of obligations issued or guaranteed by the U.S. Treasury. The ratings represent the rating agencies' opinions of the quality of the securities they rate. Ratings are relative and subjective and are not absolute standards of quality.
†Northern tax-exempt fixed income funds' and Northern High Yield Fixed Income Fund's Average Duration is calculated using the modified duration formula. Other Northern fixed income funds show the option-adjusted duration. Duration is a measure of a bond fund's sensitivity to changes in interest rates.
**Per share paid out September 24 with a record date of September 23. The amount shown represents dividends paid for net investment income and excludes distributions from capital gain income.
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Jessica K. Hart

Jessica K. Hart

Portfolio Manager

Northern Multi-Manager Emerging Markets Debt Opportunity Fund (NMEDX)
Northern Multi-Manager Emerging Markets Equity Fund (NMMEX)
Northern Multi-Manager Global Listed Infrastructure Fund (NMFIX)
Northern Multi-Manager Global Real Estate Fund  (NMMGX)
Northern Multi-Manager High Yield Opportunity Fund (NMHYX)
Northern Multi-Manager International Equity Fund (NMIEX)
Northern Multi-Manager Large Cap Fund  (NMMLX)
Northern Multi-Manager Mid Cap Fund  (NMMCX)
Northern Multi-Manager Small Cap Fund (NMMSX)

With Northern Trust Since 2000
Began Career in 1999

Jessica K. Hart, Senior Vice President of Northern Trust leads the global fund construction, supports the manager research and program management groups to create multi-manager solutions for the manager of managers practice.

Ms. Hart joined Northern Trust in 2000 and has since been responsible for due diligence on prospective managers, performance and oversight of all multi-manager funds, portfolio construction and a key member of the management team that developed portfolio optimization processes for Northern Trust's clients.

Ms. Hart received a B.S. in economics from the University of Wisconsin and an MBA from New York University, Stern School of Business.

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Christopher E. Vella, CFA<sup>&reg;</sup>, CIO

Christopher E. Vella, CFA®, CIO

Portfolio Manager

Northern Multi-Manager Emerging Markets Debt Opportunity Fund (NMEDX)
Northern Multi-Manager Emerging Markets Equity Fund (NMMEX)
Northern Multi-Manager Global Listed Infrastructure Fund (NMFIX)
Northern Multi-Manager Global Real Estate Fund  (NMMGX)
Northern Multi-Manager High Yield Opportunity Fund (NMHYX)
Northern Multi-Manager International Equity Fund (NMIEX)
Northern Multi-Manager Large Cap Fund  (NMMLX)
Northern Multi-Manager Mid Cap Fund  (NMMCX)
Northern Multi-Manager Small Cap Fund (NMMSX)

With Northern Trust Since 2004
Began Career in 1993

Christopher E. Vella, CFA®, is Chief Investment Officer with responsibility for manager research and portfolio construction processes across Northern Trust's market segments. He is responsible for the global manager research platform, consisting of approximately $60B in assets across 200 investment strategies. He manages a team of approximately 25 investment professionals across all traditional asset classes. The team covers all external manager relationships on behalf of Northern Trust's private and institutional clientele.

Prior to joining Northern Trust, Mr. Vella was a founding member of Goldman Sach's external manager business which consists of institutional and private client assets. While at Goldman, he managed the international and emerging markets equity team. Prior to Goldman Sachs, Mr. Vella spent close to 6 years at SEI Investments working primarily on international equity and emerging markets equity manager research. He has over 17 years of manager research experience.

Mr. Vella graduated Phi Beta Kappa from Lehigh University with a B.S. in finance and a minor in applied mathematics. He is an active CFA® charterholder.

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Not FDIC insured | May lose value | No bank guarantee

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Please carefully read the prospectus and summary prospectus and consider the investment objectives, risks, charges and expenses of Northern Funds before investing. Call 800-595-9111 to obtain a prospectus and summary prospectus, which contains this and other information about the funds.

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