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|For those investors who are socially conscious, the U.S. Quality ESG Fund may be the Fund for you. This Fund seeks to invest in high-quality companies that are industry leaders with regards to their environmental, social and government practices. These standards can help protect the environment and foster more favorable living conditions for future generations. Their practices might include; stewardship of the environment, service to local communities and society at large, commitments to higher labor standards, focus on safe, high-quality products and exemplary and ethical management.|
|The strategy uses a proprietary multi-factor model based on rigorous academic and empirical research to target high-quality and highly-rated ESG U.S. large- and mid-cap companies. Using a quantitative, factor based approach, the strategy seeks to invest in companies that: meet certain criteria for ESG sustainability and exhibit strong business fundamentals, solid management, and reliable cash flows.|
|If you are an investor who wants to invest in a high-quality, diversified portfolio of large- and mid-cap companies in North America that are selected based on sector ranking of environmental, social, government and financial factors, you may find this Fund attractive.|
*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 U.S. Quality ESG Fund received the following: ESG Score 56.08 – Controversy Score 7.46, which equals a Sustainability score 48.62 (7% category rank; 1,828 funds) and a Sustainability Rating of 5 Globe Icons (or "High").
|YTD Total Return||12.33% (as of 03/22/19)|
|Total Net Assets||$35,814,406 (as of 02/28/19)|
|Month|| ||YTD|| ||3-Year||5-Year|| || Since
|U.S. Quality ESG||3.57%||2.18%||12.54%||4.82%||N/A||N/A||N/A||9.31%|
|Russell 1000 Index||3.39%||1.84%||12.05%||4.99%||N/A||N/A||N/A||9.24%|
|Morningstar Cat. Avg.|
|Month|| ||YTD|| ||3-Year||5-Year|| || Since
|U.S. Quality ESG||-9.21%||-14.66%||-4.82%||-4.82%||N/A||N/A||N/A||0.58%|
|Russell 1000 Index||-9.11%||-13.82%||-4.78%||-4.78%||N/A||N/A||N/A||0.86%|
|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. ("NTI" or the "Investment Adviser") has contractually agreed to reimburse a portion of the operating expenses of the Fund (other than extraordinary expenses) to the extent the "Total Annual Fund Operating Expenses" exceed 0.43%. The "Total Annual Fund Operating Expenses After Expense Reimbursement" may be higher than the contractual limitation as a result of the extraordinary expenses that are not reimbursed. This contractual limitation may not be terminated before July 31, 2019 without the approval of the Fund's Board of Trustees. In the absence of contractual expense reimbursements, 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‡|
|U.S. Quality ESG||2.08%||0.43%|
|‡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.|
|U.S. Quality ESG*||-4.82%||N/A|
|Russell 1000 Index||-4.78%||N/A|
|Morningstar Category Avg. Large Blend||-6.27%||N/A|
|*The inception date of the Fund is October 2, 2017.
Performance quoted represents past performance and does not guarantee future results.
|Top 10 Holdings||Fund|
|Merck & Co Inc||2.4%|
|Home Depot Inc||2.3%|
|JP Morgan Chase & Co||1.8%|
|Risk Characteristics*||U.S. Quality ESG*||Russell 1000 Index|
|Up Market Capture||N/A||N/A|
|Down Market Capture||N/A||N/A|
|*||Above risk characteristics are based on a 3-year time period. Inception date of the Fund is October 2, 2017.|
|Number of Holdings||190|
|Portfolio Turnover*||10.19% (as of 03/31/18)|
|Dividend Income Last Quarter*||$0.0445|
|Capital Gain Income Last Quarter*||$0.0850|
|Weighted Average Market Cap ($Mil)||$178,740|
|Benchmark||Russell 1000 Index|
|Morningstar Category||Large Blend|
|*The inception date of the Fund is October 2, 2017.|
|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 2002
Began Career in 2002
Peter Zymali, 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 U.S. Quality ESG Fund.
Prior to joining Global Equity in 2007, Mr. Zymali was an investment consultant within the Global Family Office Group responsible for designing asset allocation strategies using an open architecture platform. Mr. Zymali joined Northern Trust in 2002.
Mr. Zymali received a B.S. in Finance from the University of Arizona and an MBA in Finance, Economics, and Managerial & Organizational Behavior from the University of Chicago Booth School of Business. Mr. Zymali is a Certified Financial PlannerTM professional.
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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