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|This Fund may be a good choice for those moderate-risk investors looking for a relatively high level of current income, but don't want to forego the capital appreciation potential of the stock market. Using quantitative analysis, our experienced investment management team buys and sells securities based on such factors as a company's current income, prospects for growth and capital appreciation potential. The Fund will, under normal circumstances, invest at least 80% of its net assets in income-producing equity securities, including dividend-paying common and preferred stocks and convertible securities. The Fund also may invest up to 20% of its net assets in a broad range of non-convertible fixed-income securities without limitation as to maturity.|
If you are a moderate-risk investor looking for a relatively high level of current income, but don't want to forego the capital appreciation potential of the stock market, you may like this Fund.
|Overall Morningstar RatingTM|
Among 1,100 large value funds derived from a weighted average of the fund's 3-,5- and 10-year risk-adjusted returns as of 12/31/18.
Income Equity received 4 stars for the 3-year rating among 1,100 large value funds, 4 stars for the 5-year rating among 937 funds and 4 stars for the 10-year rating among 686 funds.
The Morningstar RatingTM for funds, or "star rating," is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Past performance is no guarantee of future results.
©2019 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.
*The Morningstar Sustainability Rating is a measure of how well the companies held by a fund are managing their Environmental, Social and Governance ("ESG") risks and opportunities when compared with similar funds. A fund's Sustainability Rating is assigned in two steps: First, a Morningstar Portfolio Sustainability Score is derived from an asset-weighted average of the underlying company ESG scores with deductions made for holdings involved in controversial incidents. Next, funds are sorted into five normally distributed groups by comparing a fund’s Portfolio Sustainability Score with that of its Morningstar Category peers. The peer groups are assigned as follows: 5 Globe Icons (“High”) = top 10% of funds in an asset category; 4 Globe Icons ("Above Average") = next 22.5% of funds; 3 Globe Icons ("Average") = next 35%; 2 Globe Icons ("Below Average") = next 22.5% and 1 Globe Icon ("Low") = next 10%.
For a portfolio to receive a Morningstar Sustainability Score, at least 50% of its assets must be in one of the more than 4,500 companies covered by Sustainalytics (a research firm which collects ESG data) globally. To receive a Morningstar Sustainability Rating, at least 10 funds in a Morningstar Category must also receive a Portfolio Sustainability Score. The Sustainability Rating is portfolio-based, not performance-based. It should be used alongside traditional risk, return, and style metrics as well as qualitative assessments of a fund's investment process and how well it has been executed over time. Sustainability scores are calculated on a monthly basis and range from 0 to 100, 100 being the best. For more information, visit global.morningstar.com/SustainableInvesting.
As of 12/31/2018, the Income Equity Fund received the following: ESG Score 54.75 – Controversy Score 7.26, which equals a Sustainability score 47.49 (27% category rank; 643 funds) and a Sustainability Rating of 4 Globe Icons (or "Above Average").
|YTD Total Return||5.42%
|30-Day SEC Yield w/ Waivers||2.45%
|30-Day SEC Yield w/o |
|Total Net Assets|
|Month|| ||YTD|| ||3-Year||5-Year|| || Since
|S&P 500 Index||-9.03%||-13.52%||-4.38%||-4.38%||9.26%||8.49%||13.12%||9.34%|
|Morningstar Cat. Avg.|
|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.
Northern Trust Investments, Inc. has contractually agreed to reimburse a portion of the operating expenses of the Fund (other than certain excepted expenses, i.e., acquired fund fees and expenses; the compensation paid to each Independent Trustee of the Trust; expenses of third party consultants engaged by the Board of Trustees; membership dues paid to the Investment Company Institute and Mutual Fund Directors Forum; expenses in connection with the negotiation and renewal of the revolving credit facility; and extraordinary expense and interest) to the extent the "Total Annual Fund Operating Expenses" exceed 1.00%. The “Total Annual Fund Operating Expenses After Expense Reimbursement" may be higher than the contractual limitation as a result of the excepted expenses that are not reimbursed. This contractual limitation may not be terminated before July 31, 2019 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.
|Gross Expense Ratio||Net Expense Ratio‡|
|‡Includes contractual expense reimbursements that, if not extended, will end on July 31, 2019. The Fund also includes voluntary expense reimbursements that may change or end at any time.|
|S&P 500 Index||-4.38%||21.83%||11.96%||1.38%||13.69%|
|Morningstar Category Avg. Large Value||-8.53%||15.94%||14.81%||-4.05%||10.21%|
|Performance quoted represents past performance and does not guarantee future results.|
|Top 10 Holdings||Fund|
|JP Morgan Chase & Co||3.8%|
|Home Depot Inc||2.7%|
|Cisco Systems Inc||2.7%|
|Exxon Mobil Corp||2.6%|
|Lockheed Martin Corp||2.2%|
|Altria Group Inc||2.1%|
|Risk Characteristics*||Income Equity||S&P 500 Index|
|Up Market Capture||83.21||100.00|
|Down Market Capture||88.34||100.00|
|*||Above risk characteristics are based on a 3-year time period|
|Number of Holdings||93|
|Portfolio Turnover||23.14% (as of 03/31/18)|
|Dividend Income Last Quarter||$0.0716|
|Capital Gain Income Last Quarter||N/A|
|Weighted Average Market Cap ($Mil)||$183,467|
|Benchmark||S&P 500 Index|
|Morningstar Category||Large Value|
|Trailing 12-Month Price-to-Earnings Ratio|
|Historical 5-Year Earnings Growth|
With Northern Trust Since 1999
Began Career in 1999
Jeff Sampson, Senior Vice President and Senior Portfolio Manager on the Global Equity Team responsible for the implementation of several engineered equity strategies specializing in ESG investments, Tax Advantaged Equity, and Quality Dividend Focus. He currently co-manages the Northern Income Equity Fund and the Northern U.S. Quality ESG Fund.
Prior to joining Global Equity in 2007, Mr. Sampson managed a division of account managers within the Wealth Management group. Mr. Sampson joined Northern Trust in 1999.
Mr. Sampson received a BBA in Finance from the University of Wisconsin and an MBA in Accounting, Finance, and Managerial & Organizational Behavior with honors from the University of Chicago Booth School of Business. He is an active CFA® charterholder, and a member of the CFA Institute and the CFA Society Chicago.
With Northern Trust Since 2007
Began Career in 2004
Reed LeMar, Vice President, is a portfolio manager on the quantitative active equity team responsible for the research and implementation of several large/small cap quantitative equity strategies. He currently co-manages the Northern Income Equity Fund.
Prior to joining Northern Trust in 2007, Mr. LeMar was an options trader at the Chicago Board of Trade, focusing on Treasury Bond Options.
Mr. LeMar received a B.S. in finance from the University of Illinois at Urbana-Champaign. He is an active CFA® Charterholder.
With Northern Trust Since 2007
Began Career in 2002
Sridhar Kancharla, Vice President of Northern Trust, is a Senior Portfolio Manager and Researcher in the Quantitative Active Equity team responsible for research and implementation of several large/small cap quantitative equity strategies. Currently, he is a co-manager for the Northern Income Equity and Northern Large Cap Value Fund.
Prior to joining Northern Trust in 2007, Mr. Kancharla was a senior software engineer at Grossman & Associates responsible for developing industry leading commodity management and accounting software deployed at multi-billion dollar grain companies throughout North America.
Mr. Kancharla received a B.S. in computer science and mathematics from the University of Illinois at Urbana-Champaign and an MS in financial mathematics from the University of Chicago. He is a CFA® charterholder, a member of the CFA Institute, CFA Society of Chicago and the Chicago Quantitative Alliance.
Not FDIC insured | May lose value | No bank guarantee
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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