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Northern Trust Distributing Ladder ETFs

WHY DO FINANCIAL ADVISORS CHOOSE NORTHERN TRUST?

If you know, you know Northern Trust.

Discover how our newest innovation–distributing ladder ETFs – helps optimize cash flow management to achieve the most important investor goals.

Designed to Secure the Goals That Matter Most

Some of investors most important goals — retirement income, college payments, philanthropy, lifestyle needs — require recurring cash distributions. The innovative distributing ladder ETFs offer a single-fund solution that optimizes cash flow and combines low cost with potential inflation protection or tax* reduction.

Read the guide to learn how to use distributing ladder ETFs. Understand how they work, their features and benefits and explore use cases that illustrate how to integrate them into your investors’ plans.

Explore how distributing ladder ETFs can work for your investors

Explore how distributing ladder ETFs can work for your investors

Managing Recurring Expenses

Designed to pay income monthly and distribute principal annually for the life of the ETF

Keep More of What You Earn

Two suites of affordable ETFs built to provide tax-exempt income or inflation protection

Variety of Time Horizons

Four distinct maturity options – 5-, 10-, 20-, or 30-year distributing ladders to meet unique funding needs

Related Insights

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  • Using Distributing Ladder ETFs for Recurring Retirement Income
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    Learn More About ETFs

    Want to learn more?

    Contact your Northern Trust Asset Management Market Leader at 855-353-9383 to learn more.

    *Interest on municipals is exempt from federal income tax but may be subject to state and local tax.

     

    Credit (or Default) Risk is the risk that the inability or unwillingness of an issuer or guarantor of a fixed-income security, or a counterparty to a repurchase or other transaction, to meet its principal or interest payments or other financial obligations in a timely manner will adversely affect the value of the Fund’s investments and its returns.  Fluctuation of Yield and Principal Payment Risk is the risk that the Fund, unlike a direct investment in a bond that has a level coupon payment and a fixed payment at maturity, will make distributions of income that vary over time. Unlike a direct investment in bonds, the breakdown of returns between Fund distributions are not predictable at the time of your investment.  Fund Termination Risk is the risk that, unlike an investment in a traditional investment company with perpetual existence, the Fund is designed to liquidate in the terminal year and thus a shareholder of the Fund will not receive distributions from the Fund beyond the terminal year. Liquidity Risk is the risk that certain securities may be less liquid than others, which may make them difficult or impossible to sell at the time and the price that the Fund would like, and the Fund may have to lower the price, sell other securities instead or forgo an investment opportunity, adversely affecting the value of the Fund’s investments and its returns. Municipal Investments Risk is the risk that the value of a municipal security generally depends on the financial and credit status of the issuer. Constitutional amendments, legislative enactments, executive orders, administrative regulations, voter initiatives, and the issuer’s regional economic conditions may affect a municipal security’s value, interest payments, repayment of principal and the Fund’s ability to sell the security. Non-Diversification Risk is the risk that a non-diversified fund may invest a larger portion of its assets in securities issued by or representing a smaller number of issuers than a diversified fund. As a result, a Fund may be more susceptible to the risks associated with these particular issuers, or to a single economic, political or regulatory occurrence affecting these issuers. Municipal Market Volatility Risk is the risk that the Fund may be adversely affected by volatility in the municipal market. The municipal market can be significantly affected by adverse tax, legislative, political or public health changes and the financial condition of the issuers of municipal securities. Return of Capital/Distribution Risk is the risk that the Fund’s distributions will involve a return of capital, which, although not currently taxable, may lower a shareholder’s basis in the Fund’s shares, thus potentially subjecting the shareholder to future tax consequences in connection with the sale of Fund shares, even if sold at a loss to the shareholder’s original investment. Small Fund Risk is the risk that the Fund will not grow to or maintain an economically viable size, in which case it may liquidate prior to the anticipated liquidation date in the terminal year, thus impacting the Fund’s ability to achieve its investment objective.

     

    ETFs are subject to additional risks that do not apply to conventional mutual funds, including the risks that the market price of an ETF's shares may trade at a premium or discount to its net asset value, an active secondary trading market may not develop or be maintained, or trading may be halted by the exchange in which they trade, which may impact an ETF's ability to sell its shares. Shares of any ETF are bought and sold at market price (not NAV) and are not individually redeemed from the ETF. Brokerage commissions will reduce returns.

     

    Principal is invested approximately equally across each annual rung. Investors receive monthly income in launch year 0, but distribution of both monthly income and annual principal will commence in year 1 until the terminating year (identified by fund name). The net asset value of the ETFs will decline over time as income payments are made to shareholders. Individual bonds carry an obligation to fully return principal to investors at maturity, however ETFs have no such obligation.

    Before investing, carefully consider the investment objectives, risks, charges and expenses. This and other information are in the prospectus and a summary prospectus, copies of which may be obtained on this website. Read the prospectus carefully before you invest.

     

    The FlexShares ETFs, registered with the United States Securities and Exchange Commission under the Investment Company Act of 1940 are distributed by Foreside Fund Services, LLC, not affiliated with Northern Trust. The Northern Trust ETFs, registered with the United States Securities and Exchange Commission under the Investment Company Act of 1940 are distributed by Northern Funds Distributors, LLC, not affiliated with Northern Trust. FlexShares ETFs, and Northern Trust ETFs, (the “Funds”), are managed by Northern Trust Investments, Inc.

     

    All investments are subject to numerous risks, including possible loss of principal. Fund returns may not match the return of the respective indexes. The Funds are subject to the following principal risks: asset class; authorized participant; calculation methodology; commodity; concentration; counterparty; currency; derivatives; dividend; emerging markets; Environmental, Social, Governance (ESG); equity securities; financial sector; fluctuation of yield and principal payment risk; foreign securities; fund termination risk; geographic; high portfolio turnover; income; industry concentration; inflation; infrastructure-related companies; interest rate; issuer; liquidity; large cap; management; market; market trading; mid cap stock; MLP; momentum; municipal investment risk; municipal market volatility risk; natural resources; new funds; non-diversification; passive investment; privatization; securities lending; small cap stock; tax liability risk; tracking error; value investing; and volatility risk. A full description of risks is in the prospectus.

     

    Individual investors should contact their financial advisor or broker dealer representative for more information on the Funds.

     

    Investment Products and Services are:
    NOT FDIC INSURED, MAY LOSE VALUE, NO BANK GUARANTEE

     

    All registered investment companies are obliged to distribute portfolio gains to shareholders at year-end regardless of performance. Trading ETFs will also generate tax consequences and transaction expenses. The information provided is not intended to be tax advice. Tax consequences of dividend distributions may vary by individual taxpayer.