Signon to Passport
The combined assets under management of the two Northern Ultra-Short mutual funds has surpassed the $1 billion milestone less than 18 months after launch, with benchmark-beating performance and attractive yields.
Northern Ultra-Short Fixed Income Fund (NUSFX) and Northern Tax-Advantaged Ultra-Short Fixed Income Fund (NTAUX) were launched June 18, 2009 with a total of $33 million. Designed to complement clients’ cash holdings, the funds seek to allow investors to capture higher yields than a money market fund, with a variable net asset value, but less volatility than a short duration bond fund.
“They shouldn’t be seen as a substitute for a money fund. Rather, they’re designed as a complement, appropriate for a portion of a client’s 'investment cash,’ as opposed to ‘immediate cash’” said Peter Jacobs, mutual funds product manager.
The Ultra Short Funds are managed by Scott Warner (NUSFX) and manager Patrick Quinn (NTAUX), both joined by co-manager Carol Sullivan.
Both funds launched with an NAV of $10.00 and their NAVs were $10.15 (NUSFX) and $10.13 (NTAUX) as of November 30.
Performance as of 11/30/2010
|
Fund/Benchmark |
Year-to-Date |
1-Year |
Average Annual Total Return Since Inception (6/18/2009) |
30-Day SEC Yield1 Monthly as of 10/31/10 |
Distribution Rate2 as of 12/8/10 |
|
Northern Ultra-Short Fixed Income Fund (NUSFX) |
1.60% |
1.39% |
2.10% |
0.65% |
1.04% |
|
Merrill Lynch 1-year U.S. Treasury Note Index |
0.81% |
0.67% |
0.92% |
NA |
NA |
|
Northern Tax-Advantaged Ultra-Short Fixed Income Fund (NTAUX) |
1.33% |
1.21% |
1.81% |
0.78% |
0.98% |
|
75% Merrill Lynch 6-12 month U.S. Muni + 25% Merrill Lynch U.S. 1-3 year Muni |
0.83% |
0.88% |
1.22% |
NA |
NA |
1The 30-day SEC Yield represents the annualization of the Fund’s net investment income, excluding capital gains income.
2Distribution Rate represents the annualization of the Fund’s distributions ending on the date shown, including capital gains distributions.
Performance as of 9/30/2010
|
Fund/Benchmark |
3-Month |
Year-to-Date |
1-Year |
Average Annual Total Return Since Inception (6/18/2009) |
|
Northern Ultra-Short Fixed Income Fund (NUSFX) |
1.60% |
1.39% |
2.10% |
0.65% |
|
Merrill Lynch 1-year U.S. Treasury Note Index |
0.81% |
0.67% |
0.92% |
NA |
|
Northern Tax-Advantaged Ultra-Short Fixed Income Fund (NTAUX) |
1.33% |
1.21% |
1.81% |
0.78% |
|
75% Merrill Lynch 6-12 month U.S. Muni + 25% Merrill Lynch U.S. 1-3 year Muni |
0.83% |
0.88% |
1.22% |
NA |
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. The contractual reimbursement arrangement is expected to continue until at least July 31, 2011. After this date, the contractual arrangements may be terminated if it is determined to be in the best interest of the Fund and its shareholders. 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. The 30-day SEC yield more closely reflects the current earnings of the Fund than the total returns.
The funds are not money market funds, which maintain a $1.00 NAV, and the Funds’ share prices will fluctuate with the returns of the funds.
Annual Expense Ratios
|
Fund |
Gross Expense Ratio |
Net Expense Ratio* |
|
Northern Ultra-Short Fixed Income Fund (NUSFX) |
0.55% |
0.25% |
|
Northern Tax-Advantaged Ultra-Short Fixed Income Fund (NTAUX) |
0.50% |
0.25% |
*Includes contractual expense reimbursements that, if not extended, will end on July 31, 2011
The initial minimum investment on both Ultra-Short funds was reduced from $1 million to $250,000 in May. Both Funds carry a net expense ratio of 25 basis points, generating combined revenue of $2.5 million annually.
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.
Merrill Lynch 1-Year U.S. Treasury Note Index is composed of a single issue: the outstanding Treasury note that matures closest to, but not beyond, one year from each monthly rebalancing date. It is not possible to invest directly in an index.
Merrill Lynch 6-12 Month U.S. Municipal Securities Index tracks the performance of U.S. dollar denominated, investment grade, tax-exempt debt, publicly issued by U.S. states and territories, and their political subdivisions, in the U.S. domestic market. Qualifying securities must have been between six months to one year remaining term to final maturity, a fixed coupon schedule and an investment grade rating (based on an average of Moody's, S&P and Fitch). It is not possible to invest directly in an index.
Merrill Lynch 1-3 Year U.S. Municipal Securities General Obligations Index tracks the performance of U.S. dollar denominated, investment grade, tax-exempt, general obligations publicly issued by U.S. states and territories, and their political subdivisions, in the U.S. domestic market. Qualifying securities must have one to three years remaining term to maturity, a fixed coupon schedule and an investment grade rating (based on an average of Moody's S&P and Fitch). It is not possible to invest directly in an index.
©2010 Northern Funds | Northern Funds are distributed by Northern Funds Distributors, LLC, not affiliated with Northern Trust.
