Multi-Manager Large Cap Fund

Multi-Manager Large Cap

as of March 31, 2013

U.S. equities continued their advance during the quarter, with most major indices posting double-digit gains. For the quarter, the Russell 1000® Index returned 10.96%. Value stocks outperformed growth stocks, with the Russell 1000® Value Index returning 12.31%, compared with the Russell 1000® Growth Index return of 9.54%. From a sector perspective, healthcare and consumer stocks led the way, closely followed by industrials. Information technology and materials lagged materially, up less than 5% during the quarter.

The Multi-Manager Large Cap Fund underperformed during the quarter, returning 8.91% compared with the benchmark return of 10.96%. Negative stock selection in multiple sectors drove underperformance during the period. In particular, the Fund underperformed within the consumer discretionary and materials sectors. From a positioning perspective, an overweight allocation to technology also represented a headwind to results.

Delaware was the best-performing sub-adviser during the quarter, benefiting from strong results in and an overweight allocation to consumer staples. Delaware was also able to add value in the financials sector. The Fund’s other sub-advisers, however, underperformed in multiple areas, most notably the consumer sectors. Both West End and Jennison had difficulty in the consumer discretionary and consumer staples segments of their portfolios. NWQ’s performance was notable, as they underperformed materially during a strong value market. NWQ continues to have difficulty in the materials sector, largely driven by exposure to gold stocks. In addition, underperformance in technology and health care weighed on results.

If you're a long-term investor looking to diversify your investments by pursuing the growth potential of large-company stocks, then this Fund may be right for you.

Invest in large-cap stocks through a variety of external large-cap managers who have distinct investment styles and strategies.
Select complementary managers from a broad universe of investment managers.
Blend managers into a single fund in an effort to provide an attractive combination of risk and return.

Not FDIC insured | May lose value | No bank guarantee

*View investment term 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.