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Fixed Income Taxable

Core Bond

 
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TickerNAV AS OF 09/22/14
NOCBX$10.39 $0.01 Arrow Up Icon
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Snapshot
This Fund is a good choice for those long-term, income-oriented investors who are looking to diversify their investments by gaining a broad exposure to the investment-grade U.S. bond market (excluding high yield). The Core Bond Fund seeks to maximize total return consistent with reasonable risk by investing primarily in a broad range of bonds and other fixed income securities. This Fund maintains a dollar-weighted average maturity between three and 15 years. Dividends, if any, are declared and paid monthly. Capital gains, if any, are distributed at least annually.
Fund Objective
Total Return
Fund Strategy
  • Invest primarily in domestic investment-grade debt obligations with an average maturity, under normal circumstances, between three and 15 years.
  • Buy and sell securities using a relative value approach that employs models that analyze and compare expected returns and assumed risks.
  • Emphasize securities and types of securities (such as Treasury, agency, asset-backed, mortgage-related and corporate securities) that we believe have the potential to provide a favorable return.
Investor Profile
If you are a long-term, income-oriented investor who is looking to diversify your investments by gaining broad exposure to the U.S. bond market while eliminating your exposure to non-investment grade debt then this Fund may be right for you. It offers a diversified portfolio of bond securities primarily invested in U.S. investment-grade debt.
Risk/Reward Potential
”Risk/Reward
Overall Morningstar RatingTM
”Morningstar

Among 933 intermediate-term bond funds derived from a weighted average of the fund's 3-, 5- and 10-year risk-adjusted returns as of 08/31/14.

Core Bond received 3 stars for the 3-year rating among 933 intermediate-term bond funds, 3 stars for the 5-year rating among 801 funds and 4 stars for the 10-year rating among 575 funds.

Past performance is no guarantee of future results. Ratings reflect fee waivers in effect; in their absence, ratings may have been lower.

Star ratings are based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund’s monthly performance (including the effects of sales charges and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The overall rating is a weighted average of the 3-, 5-, and 10-year (if applicable) returns. 5 stars = top 10% of funds in an asset category; 4 stars = next 22.5% of funds; 3 stars = next 35%; 2 stars = next 22.5% and 1 star = next 10%. A fund must be in existence three years to be rated. Ratings are subject to change monthly.

©2014 Morningstar, Inc. All Rights Reserved. Morningstar and/or its content providers are the proprietors of this information; do not permit its unauthorized copying or distribution; do not warrant it to be accurate, complete or timely; and are not responsible for damages or losses arising from its use.

Fund Literature

 
Important risk information can be found on the Portfolio tab.
CUSIP665162376
YTD Total Return4.07% (as of 09/22/14)
Distribution Rate*1.97% (as of 09/22/14)
30-Day SEC Yield w/ waivers*1.93% (as of 08/31/14)
30-Day SEC Yield w/o waivers*1.78% (as of 08/31/14)
Inception Date 03/29/01
Total Net Assets$172,970,449 (as of 08/31/14)
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 Month Ending 08/31/14
 Annualized
    Month   3-Month     YTD  1-Year  3-Year  5-Year  10-Year Since
Incept.
Core Bond1.12%0.87%4.95%6.26%3.76%5.24%4.97%5.13%
Barclays U.S. Aggregate
Bond Index
1.10%0.90%4.81%5.66%2.91%4.48%4.72%5.20%
Morningstar Cat. Avg.
Intermediate-Term Bond
0.96%0.85%4.80%6.19%3.67%5.30%4.56%N/A

Total Returns

Total Returns for Quarter Ending 06/30/14
 Annualized
    Month   3-Month     YTD  1-Year  3-Year  5-Year  10-Year Since
Incept.
Core Bond-0.03%2.09%4.02%5.04%4.42%5.63%5.18%5.13%
Barclays U.S. Aggregate
Bond Index
0.05%2.04%3.93%4.37%3.66%4.85%4.93%5.20%
Morningstar Cat. Avg.
Intermediate-Term Bond
0.17%2.09%4.10%5.07%4.08%6.02%4.77%N/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 0.40%. 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
Core Bond0.57%0.42%
Includes contractual expense reimbursements that, if not extended, will end on July 31, 2015.

Calendar Year Returns

 
       2013      2012      2011      2010      2009
Core Bond-2.08%6.69%7.91%6.58%9.42%
Barclays U.S. Aggregate Bond Index-2.02%4.21%7.84%6.54%5.93%
Morningstar Category Avg. Intermediate-Term Bond-1.42%7.01%5.86%7.72%13.97%
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
0-1yr9.6%
1yr-2yrs10.7%
2yrs-3yrs15.2%
3yrs-5yrs20.5%
5yrs-7yrs12.2%
7yrs-10yrs15.9%
10yrs-15yrs1.7%
15yrs-20yrs3.2%
20yrs-25yrs2.0%
25yrs-30yrs7.5%
30yrs-35yrs0.4%
35yrs+1.1%
TOTAL100.0%
As of 07/31/14
Quality DistributionFundBenchmark
US Tsy (incl GNMA MBS)26.0%43.2%
US Agcy (incl FN/FH MBS)18.8%25.1%
AAA9.0%4.2%
AA2.4%3.9%
A11.2%11.6%
BBB23.6%12.0%
BB0.5%0.0%
Committed Cash8.5%0.0%
TOTAL100.0%100.0%
Sector WeightingsFundBenchmark
Treasury25.4%35.5%
Mortgage-Backed19.0%28.8%
Industrial17.1%13.9%
Financial16.8%7.6%
Commercial MBS10.0%2.1%
Committed Cash8.5%0.0%
Utilities1.9%1.8%
Asset-Backed0.7%0.5%
Foreign Agencies0.4%1.7%
Covered0.2%0.0%
Agency0.0%3.6%
Supranational0.0%1.6%
Sovereign0.0%1.5%
Municipals0.0%1.0%
Foreign Local Govt0.0%0.4%
TOTAL100.0%100.0%
DateHoldings File
As of 06/30/14Insert Icon
As of 03/31/14Insert Icon

Fund Characteristics

Number of Holdings314
Average Duration5.3 YRS
Average Maturity7.3 YRS
Weighted Average Coupon3.44%
Yield to Maturity2.22%
Income**$0.0164
Dividend ScheduleMonthly
Dividend Income Last Quarter$0.0557
Capital Gain Income Last QuarterN/A
BenchmarkBarclays U.S. Aggregate Bond Index
Morningstar CategoryIntermediate-Term 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.
Mortgage-Backed Securities Risk: Mortgage-backed investments involve risk of loss due to prepayments and, like any bond, due to default. Because of the sensitivity of mortgage-related securities to changes in interest rates, the Fund’s performance may be more volatile than if it did not hold these securities.
Barclays U.S. Aggregate Bond Index is an unmanaged index of prices of U.S. dollar-denominated, fixed rate, taxable, investment-grade fixed income securities with remaining maturities of one year and longer. It is not possible to invest directly in an index.
Quality Distribution: Credit quality ratings are based on converting the available Moody's, Standard & Poor's, and/or Fitch ratings to a common numerical basis and averaging that result. If none of these three 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). The Standard & Poor's short-term municipal rating of SP1 reflects a strong capacity to pay principal and interest (an issue determined to possess a very strong capacity to pay debt service is given a plus (+) designation). The Moody's short-term municipal rating of MIG1 denotes superior credit quality (excellent protection is afforded by established cash flows, highly reliable liquidity support or demonstrated broad-based access to the market for refinancing). Committed Cash includes any traded cash (forward settling trades), the sweep vehicle and commercial paper. 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.
Distribution Calculations: All distribution calculations (Maturity Distribution, Sector Weightings and Quality Distribution) are measured on a trade date basis and are adjusted for uninvested cash from the market value used to compute the percentage calculations.
Characteristics: Benchmark and Fund analytics have been calculated using a third party vended model. All material has been obtained from sources believed to be reliable, but the accuracy, completeness and interpretation cannot be guaranteed. Information contained herein is current as of the date appearing in this material only and is subject to change without notice. Certain benchmark calculations may not match the published benchmark characteristics.
†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 July 24 with a record date of July 23. The amount shown represents dividends paid for net investment income and excludes distributions from capital gain income.
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Bradley Camden, CFA<sup>&reg;</sup>

Bradley Camden, CFA®

Portfolio Manager

Northern Core Bond Fund (NOCBX)
Northern Fixed Income Fund ( NOFIX)
Northern Short Bond Fund (BSBAX)

With Northern Trust Since 2005
Began Career in 2002

Bradley Camden, Vice President of Northern Trust, is a member of the active long duration strategy team and responsible for research and implementation of several quantitative fixed income strategies. He currently co-manages the Northern Core Bond Fund, Northern Fixed Income Fund and Northern Short Bond Fund.

Prior to joining Northern Trust in 2005, Mr. Camden was a member of Northern Trust’s Global Opportunities Leadership Development (GOLD) program where he completed rotations in Tax Advantage Equity Indexing, Equity Research and Fixed Income.

Mr. Camden holds a B.A. in economics from DePauw University. He is an active CFA® charterholder, a member of the CFA Institute and a member of the CFA Society Chicago.

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Daniel J. Personette, CFA<sup>&reg;</sup>

Daniel J. Personette, CFA®

Portfolio Manager

Northern Core Bond Fund (NOCBX)
Northern Fixed Income Fund (NOFIX)

With Northern Trust Since 1996
Began Career in 1995

Daniel J. Personette, Vice President of Northern Trust, is a member of the fixed income group, responsible for quantitatively managing and trading fixed income accounts for Northern Trust clients. He currently co-manages the Northern Core Bond Fund and Northern Fixed Income Fund.

Prior to joining Northern Trust as an Accounting Auditor in 1996, he served in the shareholder service department at Kemper Mutual Funds.

Mr. Personette received a B.A. in finance from Ball State University and an MBA from the University of Chicago. He is an active CFA® charterholder and a member of the CFA Society Chicago.

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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.

©2014 Northern Funds | Northern Funds are distributed by Northern Funds Distributors, LLC, not affiliated with Northern Trust.