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Fixed Income Municipal

California Tax-Exempt

 
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TickerNAV AS OF 06/05/23
NCATX$10.40 $0.00 Same Icon
 
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Snapshot
For those investors who want a high current income that is exempt from regular federal income tax and California state personal income tax, you may find this Fund attractive. It is well suited for income-oriented investors in higher tax brackets who are willing to accept some risk of principal in exchange for higher yield potential. Income from the Fund may be subject to federal alternative minimum tax (AMT), state and local taxes. Our experienced investment team concentrates our investments in California-specific, investment-grade municipal instruments which are exempt from federal income tax and California state personal income tax while maintaining an average maturity between 10 and 30 years.
Fund Objective
Current Tax-Exempt Income
Fund Strategy
  • Concentrate our investments in California state-specific, investment-grade municipal instruments which are exempt from federal income tax and California state personal income tax while maintaining an average maturity, under normal circumstances, between 10 and 30 years.
  • Invest in high-quality securities, primarily investment-grade debt.
  • Select investments on the basis of their relative value with a focus on total return.
Investor Profile
If you are an investor who wants high current income that is exempt from regular federal income tax and California state personal income tax, you may find this Fund attractive. It is well suited for income-oriented investors in higher tax brackets who are willing to accept some risk of principal in exchange for higher yield potential. Income from the Fund may be subject to federal alternative minimum tax (AMT), state and local taxes.
Risk/Reward Potential
”Risk/Reward
      CUSIP665162731
      YTD Total Return2.02% (as of 06/05/23)
      Distribution Rate*2.89% (as of 06/05/23)
      30-Day SEC Yield w/ Waivers*2.72% (as of 03/31/19)
      30-Day SEC Yield w/o Waivers*2.61% (as of 03/31/19)
      Inception Date04/08/97
      Total Net Assets$179,391,287 (as of 03/31/19)
      Tax-Equivalent Distribution Rate*6.30% (as of 06/05/23)
      Tax-Equivalent 30-Day SEC Yield*5.93% (as of 03/31/19)
      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 w/waivers represents the annualization of the Fund's net investment income, excluding capital gain income and includes contractual expense reimbursements. It would be lower without those reimbursements. The 30-day SEC yield w/o waivers represents the annualization of the Fund's net investment income, excluding capital gain income, but excludes contractual expense reimbursements, resulting in a lower yield. The tax-equivalent 30-day SEC yield represents 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 45.3% for Arizona, 54.1% for California and 40.8% for national municipal funds.

      Total Returns

      Total Returns for Quarter Ending 03/31/19
       Annualized
          Month   3-Month     YTD  1-Year  3-Year  5-Year  10-Year Since
      Incept.
      California Tax-Exempt1.88%2.81%2.81%5.01%2.26%4.09%5.65%5.27%
      Bloomberg Barclays California
      Municipal Bond Index      		1.64%2.81%2.81%5.08%2.58%3.77%5.22%4.54%
      Morningstar Cat. Avg.
      Muni California Long      		1.77%2.88%2.88%4.66%2.51%4.08%5.69%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.

      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 0.45%. The "Total Annual Fund Operating Expenses After Expense Reimbursement" may be higher than the contractual limitation as a result of the excepted expenses, including but not limited to acquired fund fees and 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 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.

      Annual Expense Ratios

       
       Gross Expense RatioNet Expense Ratio‡
      California Tax-Exempt0.56%0.47%
      ‡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.

      Calendar Year Returns

       
             2018      2017      2016      2015      2014
      California Tax-Exempt1.00%5.05%-0.18%4.35%12.36%
      Bloomberg Barclays California Municipal Bond Index1.11%5.63%-0.12%3.53%9.97%
      Morningstar Category Avg. Muni California Long0.62%5.91%0.07%3.72%12.07%
      Performance quoted represents past performance and does not guarantee future results.
      .
      Portfolio Composition
         
      Maturity DistributionFund
      0 - 1 Year12.0%
      2 - 5 Years11.2%
      6 - 10 Years11.4%
      11 - 20 Years31.4%
      21 - 30 Years28.4%
      31+ Years5.6%
      As of 03/31/19
      Quality DistributionFundBenchmark
      AAA16.0%6.0%
      AA64.2%71.7%
      A7.4%16.6%
      BBB1.3%5.8%
      SP1+/MIG10.6%0.0%
      Not Rated4.3%0.0%
      Committed Cash6.2%0.0%
      Sector WeightingsFundBenchmark
      General Obligation39.5%37.7%
      Revenue36.1%57.0%
      Government-Backed12.4%4.9%
      Committed Cash6.2%0.0%
      Insured5.8%0.4%
      DateHoldings File
      As of 03/31/19Insert Icon
      As of 12/31/18Insert Icon

      Fund Characteristics

      Number of Holdings86
      Portfolio Turnover83.27% (as of 03/31/18)
      Modified Duration†5.47 YRS
      Average Maturity14.38 YRS
      Weighted Average Coupon4.06%
      Income**$0.030274
      Dividend ScheduleMonthly
      Dividend Income Last Quarter$0.1026
      Capital Gain Income Last QuarterN/A
      BenchmarkBloomberg Barclays California Municipal Bond Index
      Morningstar CategoryMuni California Long
      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.
      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.
      Tax-Free/AMT Risk: Tax-exempt funds’ income may be subject to certain state and local taxes and, depending on your tax status, the federal alternative minimum tax.
      Regional Investment Risk: The geographical concentration of portfolio holdings in this Fund may involve increased risk.
      Bloomberg Barclays California Municipal Bond Index is an unmanaged index of investment grade (Baa3 or better) tax-exempt California bonds with a remaining maturity of at least one year. It is not possible to invest directly in an index.
      Quality Distribution: Credit quality ratings are based on the conservative average of Moody's, Standard & Poor’s and Fitch ratings. If ratings from all three rating agencies disagree, the model assigns the middle rating to the security. If two of the three agree, the model assigns the rating from those two to the security. 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 D (in default). 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.
      †Modified Duration: Duration is a measure of a bond fund's sensitivity to changes in interest rates. The Fund's duration is calculated using the modified duration formula.
      **Per share paid out March 25 with a record date of March 22. The amount shown represents dividends paid for net investment income and excludes distributions from capital gain income.
      .
      Fred A. Azar

      Fred A. Azar

      Portfolio Manager

      Northern Arizona Tax-Exempt Fund (NOAZX)
      Northern California Intermediate Tax-Exempt Fund (NCITX)
      Northern California Tax-Exempt Fund (NCATX)
      Northern Tax-Exempt Fund (NOTEX)

      With Northern Trust Since 2004
      Began Career in 1991

      Fred A. Azar, Vice President of Northern Trust, is a portfolio manager in the tax-exempt fixed income group of Northern Trust Asset Management. In June 2018, he moved into his current role as co-manager of the Northern Arizona Tax-Exempt Fund, Northern California Intermediate Tax-Exempt Fund, Northern California Tax-Exempt Fund and Northern Tax-Exempt Fund.

      Mr. Azar joined Northern Trust in 2004. He has had previous positions as the Director of Fixed Income Business Management, Director of Core Strategies, and Senior Portfolio Manager in Short Duration Fixed Income. He began his career in 1991 with Harris Bank.

      Mr. Azar received a B.S. in accounting and business administration and an MBA from the University of Kansas. He is a Certified Public Accountant.

          .
          Adam M. Shane, CFA

          Adam M. Shane, CFA

          Portfolio Manager

          Northern High Yield Municipal Fund (NHYMX)
          Northern California Intermediate Tax-Exempt Fund (NCITX)
          Northern California Tax-Exempt Fund (NCATX)

          With Northern Trust Since 2010
          Began Career in 2003

          Adam M. Shane, CFA, is a Senior Vice President for Northern Trust. Mr. Shane is Director of High Yield Municipal Fixed Income and co-manages the Northern High Yield Municipal Fund, Northern California Intermediate Tax-Exempt Fund and Northern California Tax-Exempt Fund.

          Prior to his current role, Mr. Shane was Director of Fixed Income Research. He led a team of corporate, financial, municipal, and sovereign analysts in Chicago, London, and Bangalore, providing fundamental credit research in support of Northern Trust's fixed income capabilities.

          Prior to joining Northern Trust in 2010, Mr. Shane was a senior research analyst at Nuveen Investments.

          Mr. Shane has a B.A. in history from Williams College and an MBA, with concentrations in accounting and finance, from the University of Chicago, Graduate School of Business. He is an active CFA® charterholder, a member of the CFA Society Chicago, the CFA Institute, the Chicago Municipal Analysts Society, and the National Federation of Municipal Analysts.

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              Not FDIC insured | May lose value | No bank guarantee

              View investment terms definitions

              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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