Northern Funds - Active M International Equity Fund ......located at 61 Aldwych, London, United...

PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION (“SAI”) SUPPLEMENT

NORTHERN FUNDS

ACTIVE M/MULTI-MANAGER FUNDSACTIVE M INTERNATIONAL EQUITY FUNDMULTI-MANAGER GLOBAL REAL ESTATE FUND

SUPPLEMENT DATED AUGUST 26, 2020 TOPROSPECTUS AND SAI DATED JULY 31, 2020

The Board of Trustees (the “Board”) of Northern Funds (the“Trust”) has approved the appointment of Polen CapitalManagement, LLC (“Polen”) to sub-advise a portion of the ActiveM International Equity Fund. Polen will begin serving as asub-adviser of the Active M International Equity Fund effective onor about September 8, 2020.

The Board has approved the termination of Brookfield PublicSecurities Group LLC (“BPSG”) as a sub-adviser to the Multi-Manager Global Real Estate Fund, effective on August 26, 2020,and the appointment of Janus Capital Management, LLC, tosub-advise a portion of the Multi-Manager Global Real EstateFund, effective on or about September 8, 2020. During thissub-adviser transition period, Northern Trust Investments, Inc.(“NTI”), the Multi-Manager Global Real Estate Fund’s investmentadviser, will manage the portion of the Multi-Manager Global RealEstate Fund previously managed by BPSG. All references in theProspectus and SAI to BPSG are hereby deleted.

1. The paragraph under the section entitled “FUND SUMMA-RIES – Active M International Equity Fund – Management”on page 11 of the Prospectus is replaced with the following:

INVESTMENT ADVISER, PORTFOLIO MANAGERAND SUB-ADVISERS. NTI, an indirect subsidiary ofNorthern Trust Corporation, serves as the investment adviserof the Active M International Equity Fund. Christopher E.Vella, CFA, a Senior Vice President of NTI, has been managerof the Fund since January 2012. Causeway Capital Manage-ment LLC, Polen Capital Management, LLC (effective on orabout September 8, 2020), Victory Capital Management Inc.,WCM Investment Management, LLC and Wellington Man-agement Company LLP each serves as a sub-adviser of theFund. The Northern Trust Company, an affiliate of NTI,serves as transfer agent, custodian and sub-administrator tothe Fund.

2. The paragraph under the section entitled “FUND SUMMA-RIES – Multi-Manager Global Real Estate Fund – Manage-ment” on page 29 of the Prospectus is replaced with thefollowing:

INVESTMENT ADVISER, PORTFOLIO MANAGERAND SUB-ADVISERS. NTI, an indirect subsidiary ofNorthern Trust Corporation, serves as the investment adviserof the Multi-Manager Global Real Estate Fund. ChristopherE. Vella, CFA, a Senior Vice President of NTI, has beenmanager of the Fund since January 2012. Janus CapitalManagement, LLC (effective on or about September 8, 2020)and Massachusetts Financial Services Company each serves asa sub-adviser of the Fund. The Northern Trust Company, anaffiliate of NTI, serves as transfer agent, custodian andsub-administrator to the Fund.

3. The following is added to the section entitled “FUNDMANAGEMENT – Active M International Equity Fund”beginning on page 39 of the Prospectus:

POLEN CAPITAL MANAGEMENT, LLC (“POLEN”).Polen will begin to manage a portion of the Fund effective onor about September 8, 2020. Polen was founded in 1979 byDavid Polen and is located at 1825 NW Corporate Blvd., Suite300, Boca Raton, Florida 33431. As of June 30, 2020, Polenhad assets under management of approximately$44.97 billion. Polen is an independent registered investmentadviser, providing investment advisory services focused onU.S. and International growth-oriented equity strategies.Polen’s investment process focuses on identifying and inves-ting in a concentrated portfolio of high-quality large capgrowth companies with durable earnings profiles driven bysustainable competitive advantages, superior financialstrength, proven management teams and powerful products/services that can deliver sustainable, above-average earningsgrowth. Polen believes that maintaining a concentratedportfolio allows for greater long-term return potential thatcan have a more substantial impact on a portfolio.

4. The following is added to the section entitled “FUNDMANAGEMENT – Multi-Manager Global Real Estate Fund”on page 41 of the Prospectus:

JANUS CAPITAL MANAGEMENT, LLC (“JANUS”).Janus will begin to manage a portion of the Fund effective onor about September 8, 2020. Janus is a wholly-owned sub-sidiary of Janus Henderson Group plc. Janus is located at 151Detroit Street, Denver, Colorado 80206. As of June 30, 2020,Janus had assets under management of approximately$336.69 billion. Janus provides investment advisory servicesfor domestic and international equity, fixed income, assetallocation and alternative investment strategies. Janus seeks todeliver total return through a combination of capitalappreciation and current income by investing in global realestate securities.

PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION (“SAI”) SUPPLEMENT

Janus employs an investment process based on thoroughresearch which, combined with the team’s proprietaryinvestment valuation framework, allows them to identifycompanies they believe will outperform over the long term.Janus takes an active approach to building an all capital-ization, concentrated portfolio of 50 to 60 real estate secu-rities that is diversified across property types.

5. The information under the section entitled “INVESTMENTADVISER, SUB-ADVISERS, TRANSFER AGENT ANDCUSTODIAN – Investment Sub-Advisers – Active MInternational Equity Fund” on page 82 of the SAI is deletedand replaced with the following:

Sub-Advisers

Active MInternationalEquity Fund

Causeway Capital Management LLC (“Causeway”)Polen Capital Management, LLC (“Polen”)(effective on or about September 8, 2020)Victory Capital Management Inc. (“VictoryCapital”)WCM Investment Management, LLC (“WCM”)Wellington Management Company LLP(“Wellington”)

6. The information under the section entitled “INVESTMENTADVISER, SUB-ADVISERS, TRANSFER AGENT ANDCUSTODIAN – Investment Sub-Advisers – Multi-ManagerGlobal Real Estate Fund” on page 82 of the SAI is deleted andreplaced with the following:

Sub-Advisers

Multi-ManagerGlobal Real EstateFund

Janus Capital Management, LLC (“Janus”)(effective on or about September 8, 2020)Massachusetts Financial Services Company(“MFS”)

7. The following information is added to the section entitled“INVESTMENT ADVISER, SUB-ADVISERS, TRANSFERAGENT AND CUSTODIAN – Investment Sub-Advisers”under the Sub-Adviser ownership and control informationbeginning on page 83 of the SAI:

Janus

Janus is a Delaware limited liability company and an indirectwholly-owned subsidiary of Janus Henderson Group plc(“JHG”), doing business as Janus Henderson Investors. Noindividual or person owns/controls more than 25% of JHG.

Polen

Polen is a Delaware limited liability company. Polen is 71%employee-owned, with 9% owned by Polen Family Holdings,Inc. and 20% owned by iM Square Holding 1, LLC.

Please retain this Supplement with your Prospectus and SAI for future reference.

50 South LaSalle Street

P.O. Box 75986

Chicago, Illinois 60675-5986

800-595-9111

northerntrust.com/funds

MANAGED BY MMF SPT SAI&PRO (8/20)

A C T I V E M / M U L T I - M A N A G E R F U N D S

N O R T H E R N F U N D S P R O S P E C T U S

ACTIVE M EMERGING MARKETSEQUITY FUND (NMMEX)

ACTIVE M INTERNATIONAL EQUITYFUND (NMIEX)

MULTI-MANAGER EMERGING MARKETSDEBT OPPORTUNITY FUND (NMEDX)

MULTI-MANAGER GLOBAL LISTEDINFRASTRUCTURE FUND (NMFIX)

MULTI-MANAGER GLOBAL REAL ESTATEFUND (NMMGX)

MULTI-MANAGER HIGH YIELDOPPORTUNITY FUND (NMHYX)

Prospectus dated July 31, 2020

An investment in a Fund is not a deposit of any bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation (“FDIC”),any other government agency, or The Northern Trust Company, its affiliates, subsidiaries or any other bank. An investment in a Fund involvesinvestment risks, including possible loss of principal.

The Securities and Exchange Commission (“SEC”) has not approved or disapproved these securities or passed upon the adequacy of thisProspectus. Any representation to the contrary is a criminal offense.

Beginning on January 1, 2021, as permitted by regulations adopted by the SEC, paper copies of Northern Funds shareholder reports will nolonger be sent by mail, unless you specifically request paper copies of the reports from Northern Funds or from your financial intermediary, suchas a broker-dealer or bank. Instead, the reports will be made available on the Funds’ website (northerntrust.com/funds) and you will be notifiedby mail each time a report is posted and provided with a website link to access the report.

If you have already elected to receive your shareholder reports electronically, you will not be affected by this change and you need not take anyaction. You may elect to receive shareholder reports and other communications from Northern Funds electronically at any time by contactingyour financial intermediary (such as a broker-dealer or bank) or, if your account is held directly with Northern Funds, by calling the NorthernFunds Center at 800-595-9111 or by sending an e-mail request to: [email protected].

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, please contact your financialintermediary to continue receiving paper copies of your shareholder reports. If you invest directly with Northern Funds, you can inform NorthernFunds that you wish to continue receiving paper copies of your shareholder reports by calling the Northern Funds Center at 800-595-9111 or bysending an e-mail request to: [email protected]. Your election to receive reports in paper will apply to all Northern Funds you hold in youraccount at the financial intermediary or through an account with Northern Funds. You must provide separate instructions to each of your financialintermediaries.

NORTHERN FUNDS PROSPECTUS 1 ACTIVE M/MULTI -MANAGER FUNDS


T A B L E O F C O N T E N T S

3 FUND SUMMARIES

3 ACTIVE M EMERGING MARKETS EQUITY FUND

8 ACTIVE M INTERNATIONAL EQUITY FUND

13 MULTI-MANAGER EMERGING MARKETS DEBT OPPORTUNITY

FUND

19 MULTI-MANAGER GLOBAL LISTED INFRASTRUCTURE FUND

25 MULTI-MANAGER GLOBAL REAL ESTATE FUND

30 MULTI-MANAGER HIGH YIELD OPPORTUNITY FUND

36 BROAD-BASED SECURITIES MARKET INDICES

37 INVESTMENT ADVISER

38 MANAGEMENT FEES

39 FUND MANAGEMENT

43 OTHER FUND SERVICES

44 PURCHASING AND SELLING SHARES

44 PURCHASING SHARES

44 OPENING AN ACCOUNT

45 SELLING SHARES

48 ACCOUNT POLICIES AND OTHER INFORMATION

56 DIVIDENDS AND DISTRIBUTIONS

57 TAX CONSIDERATIONS

60 SECURITIES, TECHNIQUES AND RISKS

60 ADDITIONAL INFORMATION ON INVESTMENT OBJECTIVES,

PRINCIPAL INVESTMENT STRATEGIES AND RELATED RISKS,

DESCRIPTION OF SECURITIES AND COMMON INVESTMENT

TECHNIQUES

88 DISCLAIMERS

89 FINANCIAL HIGHLIGHTS

96 FOR MORE INFORMATION

ACTIVE M/MULTI -MANAGER FUNDS 2 NORTHERN FUNDS PROSPECTUS


F U N D S U M M A R I E S

A C T I V E M E M E R G I N G M A R K E T S E Q U I T Y F U N D

I N V E S T M E N T O B J E C T I V E

The Fund seeks to provide long-term capital appreciationthrough a diversified portfolio of primarily emerging andfrontier market equity securities. Any income received isincidental to this objective.

F E E S A N D E X P E N S E S O F T H E F U N D

This table describes the fees and expenses that you may pay ifyou buy and hold shares of the Fund.

Shareholder Fees (fees paid directly from your investment)

Maximum Sales Charge (Load) Imposed on Purchases (as apercentage of offering price) None

Redemption Fee (within 30 days of purchase) (as a percentage ofamount redeemed, if applicable) 2.00%

Annual Fund Operating Expenses (expenses that you pay each year as apercentage of the value of your investment)

Management Fees 1.08%

Other Expenses(1) 0.17%

Transfer Agent Fees 0.04%

Other Operating Expenses 0.13%

Total Annual Fund Operating Expenses(1) 1.25%

Expense Reimbursement(2) (0.15)%

Total Annual Fund Operating Expenses After ExpenseReimbursement(2) 1.10%

(1) Other Expenses have been restated to reflect current fees. The “Total AnnualFund Operating Expenses” does not correlate to the ratio to average netassets of expenses before reimbursements and credits in the Fund’s annualreport, which does not reflect the restatement of other expenses to reflect cur-rent fees.

(2) Northern Trust Investments, Inc. (“NTI” or the “Investment Adviser”) has con-tractually 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 ofthird party consultants engaged by the Board of Trustees, membership duespaid to the Investment Company Institute and Mutual Fund Directors Forum,expenses in connection with the negotiation and renewal of the revolving creditfacility, extraordinary expenses and interest) to the extent the “Total AnnualFund Operating Expenses” exceed 1.10%. This contractual limitation may notbe terminated before July 31, 2021 without the approval of the Fund’s Boardof Trustees.

E X A M P L E

The following Example is intended to help you compare thecost of investing in the Fund with the cost of investing in othermutual funds. The Example assumes that you invest $10,000 in

the Fund for the time periods indicated and then redeem all ofyour shares at the end of those periods. The Example alsoassumes that your investment has a 5% return each year andthat the Fund’s operating expenses remain the same. Althoughyour actual costs may be higher or lower, based on theseassumptions your costs would be:

1 Year 3 Years 5 Years 10 Years

$112 $382 $672 $1,498

PORTFOLIO TURNOVER. The Fund pays transaction costs, suchas commissions, when it buys and sells securities (or “turnsover” its portfolio). A higher portfolio turnover rate mayindicate higher transaction costs and may result in higher taxeswhen Fund shares are held in a taxable account. These costs,which are not reflected in annual portfolio operating expensesor in the Example, affect the Fund’s performance. During themost recent fiscal year, the Fund’s portfolio turnover rate was81.32% of the average value of its portfolio.

P R I N C I P A L I N V E S T M E N T S T R A T E G I E S

In seeking long-term capital appreciation, the Fund will invest,under normal circumstances, at least 80% of its net assets inequity securities of issuers domiciled in emerging and frontiermarkets. Emerging and frontier markets are defined as thosemarkets included in the MSCI Emerging Markets® Index andMSCI Frontier Markets® Index. As of May 31, 2020, the indicesincluded the following markets: Argentina, Bahrain,Bangladesh, Benin, Brazil, Burkina Faso, Chile, China,Colombia, Croatia, Czech Republic, Egypt, Estonia, Greece,Guinea-Bissau, Hungary, India, Indonesia, Ivory Coast, Jordan,Kazakhstan, Kenya, Korea, Kuwait, Lebanon, Lithuania,Malaysia, Mali, Mauritius, Mexico, Morocco, Niger, Nigeria,Oman, Pakistan, Peru, the Philippines, Poland, Qatar,Romania, Russia, Saudi Arabia, Senegal, Serbia, Slovenia,South Africa, Sri Lanka, Taiwan, Thailand, Togo, Tunisia,Turkey, the United Arab Emirates and Vietnam. Thesecountries are subject to change with changes in the indices. TheFund’s sub-advisers may also consider emerging and frontiermarkets as classified by the World Bank, International FinanceCorporation or the United Nations and other similar agencies.The Fund may invest in companies of any size located in anumber of countries throughout the world.

The Fund utilizes a “multi-manager” approach whereby theFund’s assets are allocated to one or more sub-advisers, inpercentages determined at the discretion of the Fund’sinvestment adviser. Each sub-adviser acts independently fromthe others and utilizes its own distinct investment style in




selecting securities. However, each sub-adviser must operatewithin the constraints of the Fund’s investment objective,strategies and restrictions.

When determining the allocations and reallocations tosub-advisers, the Fund’s investment adviser will consider avariety of factors, including but not limited to the sub-adviser’sstyle, historical performance, and the characteristics of eachsub-adviser’s allocated assets (including capitalization, growthand profitability measures, valuation metrics, economic sectorexposures, and earnings and volatility statistics). The Fund’sinvestment adviser seeks, through its selection of sub-advisersand its allocation determinations, to reduce portfolio volatilityand provide an attractive combination of risk and return forthe Fund.

The sub-advisers may engage in active trading, and will notconsider portfolio turnover a limiting factor in makingdecisions for the Fund.

Morgan Stanley Capital International, Inc. (“MSCI”) does notendorse any of the securities in the MSCI Emerging Markets Indexor MSCI Frontier Markets Index. It is not a sponsor of the ActiveM Emerging Markets Equity Fund and is not affiliated with theFund in any way.

P R I N C I P A L R I S K S

As with any investment, you could lose all or part of yourinvestment in the Fund, and the Fund’s performance could trailthat of other investments. The Fund is subject to certain risks,including the principal risks noted below, any of which mayadversely affect the Fund’s net asset value (“NAV”), total returnand ability to meet its investment objective. Each risk notedbelow is considered a principal risk of investing in the Fund,regardless of the order in which it appears. The significance ofeach risk factor below may change over time and you shouldreview each risk factor carefully.

MARKET RISK is the risk that the value of the Fund’sinvestments may increase or decrease in response to expected,real or perceived economic, political or financial events in theU.S. or global markets. The frequency and magnitude of suchchanges in value cannot be predicted. Certain securities andother investments held by the Fund may experience increasedvolatility, illiquidity, or other potentially adverse effects inresponse to changing market conditions, inflation, changes ininterest rates, lack of liquidity in the bond or equity markets,volatility in the equity markets, market disruptions caused bylocal or regional events such as war, acts of terrorism, thespread of infectious illness (including epidemics andpandemics) or other public health issues, recessions or otherevents or adverse investor sentiment or other political,

regulatory, economic and social developments, anddevelopments that impact specific economic sectors, industriesor segments of the market. These risks may be magnified ifcertain events or developments adversely interrupt the globalsupply chain; in these and other circumstances, such risksmight affect companies worldwide due to increasinglyinterconnected global economies and financial markets. Marketrisk includes the risk that a particular style of investing, such asgrowth or value, may underperform the market generally.

EMERGING MARKETS RISK is the risk that markets of emergingmarket countries are less developed and less liquid, subject togreater price volatility and generally subject to increasedeconomic, political, regulatory and other uncertainties thanmore developed markets.

▪ FOREIGN SECURITIES RISK is the risk that investing inforeign (non-U.S.) securities may result in the Fundexperiencing more rapid and extreme changes in valuethan a fund that invests exclusively in securities of U.S.companies, due to less liquid markets, and adverseeconomic, political, diplomatic, financial, and regulatoryfactors. Foreign governments also may impose limits oninvestment and repatriation and impose taxes. Any ofthese events could cause the value of the Fund’sinvestments to decline. To the extent that the Fund’s assetsare concentrated in a single country or geographic region,the Fund will be subject to the risks associated with thatparticular country or region.

▪ CURRENCY RISK is the risk that foreign currencies,securities that trade in or receive revenues in foreigncurrencies, or derivatives that provide exposure to foreigncurrencies will fluctuate in value relative to the U.S. dollar,adversely affecting the value of the Fund’s investments andits returns. Because the Fund’s NAV is determined on thebasis of U.S. dollars, you may lose money if the localcurrency of a foreign market depreciates against the U.S.dollar, even if the market value of the Fund’s holdingsappreciates. In addition, fluctuations in the exchangevalues of currencies could affect the economy or particularbusiness operations of companies in a geographic region inwhich the Fund invests, causing an adverse impact on theFund’s investments in the affected region.

▪ DEPOSITARY RECEIPTS RISK. Foreign securities may tradein the form of Depositary Receipts. In addition toinvestment risks associated with the underlying issuer,Depositary Receipts may expose the Fund to additionalrisks associated with non-uniform terms that apply toDepositary Receipt programs, including credit exposure tothe depository bank and to the sponsors and other partieswith whom the depository bank establishes the programs,currency, political, economic, and market risks and the




risk of an illiquid market for Depositary Receipts.Depositary Receipts are generally subject to the same risksas the foreign securities that they evidence or into whichthey may be converted. Depository Receipts may not trackthe price of the underlying foreign securities on which theyare based, may have limited voting rights, and may have adistribution subject to a fee charged by the depository. As aresult, equity shares of the underlying issuer may trade at adiscount or premium to the market price of theDepository Receipts.

▪ FOREIGN CUSTODY RISK. The Fund may hold foreignsecurities and cash with foreign banks, agents, andsecurities depositories appointed by the Fund’s custodian(each a “Foreign Custodian”). Some Foreign Custodiansmay be recently organized or new to the foreign custodybusiness. In some countries, Foreign Custodians may besubject to little or no regulatory oversight over orindependent evaluation of their operations. Further, thelaws of certain countries may place limitations on theFund’s ability to recover its assets if a Foreign Custodianenters bankruptcy. Investments in emerging markets maybe subject to even greater custody risks than investmentsin more developed markets. Custody services in emergingmarket countries are very often undeveloped and may beconsiderably less well-regulated than in more developedcountries, and thus may not afford the same level ofinvestor protection as would apply in developed countries.

▪ FRONTIER MARKETS RISK is the risk that frontier countriesgenerally have smaller economies or less developed capitalmarkets than traditional emerging markets and, as a result,the risks of investing in emerging market countries aremagnified in frontier countries.

MULTI-MANAGER RISK is the risk that the sub-advisers’investment styles will not always be complementary, whichcould affect the performance of the Fund.

MANAGEMENT RISK is the risk that a strategy used by theFund’s investment adviser or sub-advisers may fail to producethe intended results or that imperfections, errors or limitationsin the tools and data used by the investment adviser may causeunintended results.

GEOGRAPHIC RISK is the risk that if the Fund invests asignificant portion of its total assets in certain issuers within thesame geographic region, an adverse economic, business orpolitical development affecting that region may affect the valueof the Fund’s investments more, and the Fund’s investmentsmay be more volatile, than if its investments were not soconcentrated in such geographic.

SECTOR RISK is the risk that companies in similar businessesmay be similarly affected by particular economic or market

events, which may, in certain circumstances, cause the value ofsecurities of all companies in a particular sector of the marketto decrease. While the Fund may not concentrate in any oneindustry, the Fund may invest without limitation in a particularmarket sector.

▪ TECHNOLOGY SECURITIES RISK is the risk that securities oftechnology companies may be subject to greater pricevolatility than securities of companies in other sectors.These securities may fall in and out of favor with investorsrapidly, which may cause sudden selling and dramaticallylower market prices. Technology securities also may beaffected adversely by changes in technology, consumer andbusiness purchasing patterns, government regulation and/or obsolete products or services.

CYBERSECURITY RISK is the risk of an unauthorized breach andaccess to Fund assets, Fund or customer data (including privateshareholder information), or proprietary information, or therisk of an incident occurring that causes the Fund, theinvestment adviser, sub-advisers, custodian, transfer agent,distributor and other service providers and financialintermediaries to suffer data breaches, data corruption or loseoperational functionality or prevent Fund investors frompurchasing, redeeming or exchanging shares or receivingdistributions. The Fund, its investment adviser andsub-advisers have limited ability to prevent or mitigatecybersecurity incidents affecting third-party service providers,and such third-party service providers may have limitedindemnification obligations to the Fund or its investmentadviser. Successful cyber-attacks or other cyber-failures orevents affecting the Fund or its service providers may adverselyimpact and cause financial losses to the Fund or itsshareholders. Issuers of securities in which the Fund invests arealso subject to cybersecurity risks, and the value of thesesecurities could decline if the issuers experience cyber-attacksor other cyber-failures.

LARGE SHAREHOLDER RISK is the risk that the Fund mayexperience adverse effects when certain large shareholders,including funds or accounts over which the Fund’s investmentadviser or an affiliate of the investment adviser has investmentdiscretion, purchase or redeem large amounts of shares of theFund. Such large shareholder redemptions, which may occurrapidly and unexpectedly, may cause the Fund to sell itssecurities at times it would not otherwise do so, which maynegatively impact its liquidity and/or NAV. Such sales may alsoaccelerate the realization of taxable income to shareholders ifthese sales result in gains, and may also increase transactioncosts. In addition, large redemptions could lead to an increasein the Fund’s expense ratio due to expenses being allocated overa smaller asset base. Large purchases of the Fund’s shares mayalso adversely affect the Fund’s performance to the extent that




the Fund is delayed in investing new cash or otherwisemaintains a larger cash position than it ordinarily would.

MID CAP STOCK RISK is the risk that stocks of mid-sizedcompanies may be subject to more abrupt or erratic marketmovements than stocks of larger, more established companies.Mid-sized companies may have limited product lines orfinancial resources, and may be dependent upon a particularniche of the market.

SMALL CAP STOCK RISK is the risk that stocks of smallercompanies may be subject to more abrupt or erratic marketmovements than stocks of larger, more established companies.Small companies may have limited product lines or financialresources, or may be dependent upon a small or inexperiencedmanagement group, and their securities may trade lessfrequently and in lower volume than the securities of largercompanies, which could lead to higher transaction costs.Generally, the smaller the company size, the greater the risk.

VALUATION RISK is the risk that the sale price the Fund couldreceive for a portfolio security may differ from the Fund’svaluation of the security, particularly for securities that trade inlow volume or volatile markets or that are valued using a fairvalue methodology. Fair valuation of the Fund’s investmentsinvolves subjective judgment. The Fund’s ability to value itsinvestments may be impacted by technological issues and/orerrors by pricing services or other third-party service providers.In addition, the value of the securities in the Fund’s portfoliomay change on days when shareholders will not be able topurchase or sell the Fund’s shares.

As with any mutual fund, it is possible to lose money on aninvestment in the Fund. An investment in the Fund is not adeposit of any bank and is not insured or guaranteed by theFederal Deposit Insurance Corporation, any other governmentagency, or The Northern Trust Company, its affiliates,subsidiaries or any other bank.

F U N D P E R F O R M A N C E

The bar chart and table that follow provide an indication of therisks of investing in the Fund by showing (A) changes in theperformance of the Fund from year to year, and (B) how theaverage annual total returns of the Fund compare to those of abroad-based securities market index.

The Fund’s past performance, before and after taxes, is notnecessarily an indication of how the Fund will perform in thefuture.

Updated performance information for the Fund is available andmay be obtained on the Fund’s website at northerntrust.com/funds or by calling 800-595-9111.

CALENDAR YEAR TOTAL RETURN*

-30

-20

-10

10

0

20

30

40

50

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

(4.22)%

(17.73)%

(0.44)%

19.75%23.04%

12.65%

(16.06)%

35.41%

16.24%

(14.90)%

* Year to date total return for the six months ended June 30, 2020 is(11.77)%. For the period shown in the bar chart above, the highestquarterly return was 21.15% in the third quarter of 2010, and thelowest quarterly return was (22.25)% in the third quarter of 2011.

AVERAGE ANNUAL TOTAL RETURN(For the periods ended December 31, 2019)

InceptionDate 1-Year 5-Year 10-Year

SinceInception

Active M EmergingMarkets Equity Fund 11/19/08

Returns before taxes 16.24% 4.84% 3.98% 10.77%

Returns after taxeson distributions 13.88% 4.20% 3.23% 9.93%

Returns after taxeson distributions andsale of Fund shares 10.91% 3.79% 3.23% 9.04%

MSCI EmergingMarkets Index (reflectsno deduction for fees,expenses, or taxes) 18.42% 5.61% 3.68% 10.30%

After - tax returns are calculated using the historical highest individualfederal marginal income tax rates and do not ref lect the impact ofstate and local taxes. Actual after - tax returns depend on an investor’stax si tuation and may dif fer from those shown. After - tax returns shownare not relevant to investors who hold their shares throughtax-deferred arrangements, such as 401(k) plans or individualret irement accounts.

In calculat ing the federal income taxes due on redemptions, capitalgains taxes result ing from redemptions are subtracted from theredemption proceeds and the tax benefi ts from capital losses result ingfrom the redemptions are added to the redemption proceeds.

M A N A G E M E N T

INVESTMENT ADVISER, PORTFOLIO MANAGER AND

SUB-ADVISERS. NTI, an indirect subsidiary of Northern TrustCorporation, serves as the investment adviser of the Active MEmerging Markets Equity Fund. Christopher E. Vella, CFA, aSenior Vice President of NTI, has been manager of the Fund




since January 2012. Ashmore Investment Management Limited,Axiom International Investors LLC and Westwood GlobalInvestments, LLC each serves as a sub-adviser of the Fund. TheNorthern Trust Company, an affiliate of NTI, serves as transferagent, custodian and sub-administrator to the Fund.

P U R C H A S E A N D S A L E O F F U N D S H A R E S

You may open an account directly with Northern Funds (the“Trust”) with a minimum initial investment of $2,500 in theFund ($500 for an IRA; $250 under the Automatic InvestmentPlan; and $500 for employees of Northern Trust and itsaffiliates). The minimum subsequent investment is $50 (exceptfor reinvestments of distributions for which there is nominimum). The Fund reserves the right to waive theseminimums. You may also purchase Fund shares through youraccount at Northern Trust (or an affiliate) or an authorizedintermediary.

On any business day, you may sell (redeem) or exchange sharesthrough your account by contacting your Northern Trustaccount representative or authorized intermediary. If youpurchase shares directly from the Trust, you may sell (redeem)or exchange your shares in one of the following ways:

▪ By Mail – Send a written request to: Northern Funds,P.O. Box 75986, Chicago, Illinois 60675-5986.

▪ By Telephone – Authorize the telephone privilege on yourNew Account Application. Call 800-595-9111 to use thetelephone privilege.

▪ By Wire – Authorize wire redemptions on your New AccountApplication and have proceeds sent by federal wire transfer toa previously designated bank account (the minimumredemption amount by this method is $250). You will becharged $15 for each wire redemption unless the designatedbank account is maintained at Northern Trust or an affiliatedbank. Call 800-595-9111 for instructions.

▪ By Systematic Withdrawal – If you own shares of the Fundwith a minimum value of $10,000, you may elect to have a

fixed sum redeemed at regular intervals and distributed incash or reinvested in one or more other funds of the Trust.Call 800-595-9111 for an application form and additionalinformation. The minimum amount is $250 per withdrawal.

▪ By Exchange – Complete the Exchange Privilege section ofyour New Account Application to exchange shares of onefund in the Trust for shares of another fund in the Trust.Shares being exchanged must have a value of at least $1,000($2,500 if a new account is being established by the exchange,$500 if the new account is an IRA). Call 800-595-9111 formore information.

▪ By Internet – You may initiate transactions between NorthernTrust banking and Fund accounts by using Northern TrustPrivate Passport. For details and to sign up for this service, goto northerntrust.com/funds or contact your RelationshipManager.

T A X I N F O R M A T I O N

The Fund’s distributions are generally taxable to you asordinary income, qualified dividend income, capital gains, or acombination of the three, unless you are investing through atax-exempt or tax-deferred arrangement, such as a 401(k) planor an individual retirement account. Distributions may betaxable upon withdrawal from tax-deferred accounts.

P A Y M E N T S T O B R O K E R S - D E A L E R S A N D O T H E R

F I N A N C I A L INTERMEDIARIES

If you purchase the Fund through a broker-dealer or otherfinancial intermediary (such as a bank), the Fund and itsrelated companies may pay the intermediary for the sale ofFund shares and related services. These payments may create aconflict of interest by influencing the broker-dealer or otherintermediary and your salesperson to recommend the Fundover another investment. Ask your salesperson or visit yourfinancial intermediary’s website for more information.



A C T I V E M I N T E R N A T I O N A L E Q U I T Y F U N D


The Fund seeks to provide long-term capital appreciationthrough a diversified portfolio of primarily non-U.S. equitysecurities. Any income received is incidental to this objective.













Total Annual Fund Operating Expenses After ExpenseReimbursement(2)(3) 0.85%



(3) The “Total Annual Fund Operating Expenses After Expense Reimbursement”may be higher than the contractual expense reimbursement rate shown abovedue to excepted expenses that are not reimbursed.

E X A M P L E

The following Example is intended to help you compare thecost of investing in the Fund with the cost of investing in othermutual funds. The Example assumes that you invest $10,000 inthe Fund for the time periods indicated and then redeem all of

your shares at the end of those periods. The Example alsoassumes that your investment has a 5% return each year andthat the Fund’s operating expenses remain the same. Althoughyour actual costs may be higher or lower, based on theseassumptions your costs would be:


$87 $284 $498 $1,114



In seeking long-term capital appreciation, the Fund will invest,under normal circumstances, at least 80% of its net assets inequity securities of issuers domiciled outside the U.S. The Fundmay invest in companies of any size located in a number ofcountries throughout the world but primarily in the world’sdeveloped capital markets. The Fund may invest up to 40% ofits net assets in issuers domiciled in emerging markets.

The Fund utilizes a “multi-manager” approach whereby theFund’s assets are allocated to one or more sub-advisers, inpercentages determined at the discretion of the Fund’sinvestment adviser. Each sub-adviser acts independently fromthe others and utilizes its own distinct investment style inselecting securities. However, each sub-adviser must operatewithin the constraints of the Fund’s investment objective,strategies and restrictions.

When determining the allocations and reallocations tosub-advisers, the Fund’s investment adviser will consider avariety of factors, including but not limited to the sub-adviser’sstyle, historical performance, and the characteristics of eachsub-adviser’s allocated assets (including capitalization, growthand profitability measures, valuation metrics, economic sectorexposures, and earnings and volatility statistics). The Fund’sinvestment adviser seeks, through its selection of sub-advisersand its allocation determinations, to reduce portfolio volatilityand provide an attractive combination of risk and return forthe Fund.







MARKET RISK is the risk that the value of the Fund’sinvestments may increase or decrease in response to expected,real or perceived economic, political or financial events in theU.S. or global markets. The frequency and magnitude of suchchanges in value cannot be predicted. Certain securities andother investments held by the Fund may experience increasedvolatility, illiquidity, or other potentially adverse effects inresponse to changing market conditions, inflation, changes ininterest rates, lack of liquidity in the bond or equity markets,volatility in the equity markets, market disruptions caused bylocal or regional events such as war, acts of terrorism, thespread of infectious illness (including epidemics andpandemics) or other public health issues, recessions or otherevents or adverse investor sentiment or other political,regulatory, economic and social developments, anddevelopments that impact specific economic sectors, industriesor segments of the market. These risks may be magnified ifcertain events or developments adversely interrupt the globalsupply chain; in these and other circumstances, such risksmight affect companies worldwide due to increasinglyinterconnected global economies and financial markets. Marketrisk includes the risk that a particular style of investing, such asgrowth or value, may underperform the market generally.

FOREIGN SECURITIES RISK is the risk that investing in foreign(non-U.S.) securities may result in the Fund experiencing morerapid and extreme changes in value than a fund that investsexclusively in securities of U.S. companies, due to less liquidmarkets, and adverse economic, political, diplomatic, financial,and regulatory factors. Foreign governments also may imposelimits on investment and repatriation and impose taxes. Any ofthese events could cause the value of the Fund’s investments todecline. To the extent that the Fund’s assets are concentrated ina single country or geographic region, the Fund will be subjectto the risks associated with that particular country or region.

▪ CURRENCY RISK is the risk that foreign currencies,securities that trade in or receive revenues in foreigncurrencies, or derivatives that provide exposure to foreigncurrencies will fluctuate in value relative to the U.S. dollar,

adversely affecting the value of the Fund’s investments andits returns. Because the Fund’s NAV is determined on thebasis of U.S. dollars, you may lose money if the localcurrency of a foreign market depreciates against the U.S.dollar, even if the market value of the Fund’s holdingsappreciates. In addition, fluctuations in the exchangevalues of currencies could affect the economy or particularbusiness operations of companies in a geographic region inwhich the Fund invests, causing an adverse impact on theFund’s investments in the affected region.

▪ EMERGING MARKETS RISK is the risk that markets ofemerging market countries are less developed and lessliquid, subject to greater price volatility and generallysubject to increased economic, political, regulatory andother uncertainties than more developed markets.





SECTOR RISK is the risk that companies in similar businessesmay be similarly affected by particular economic or market




events, which may, in certain circumstances, cause the value ofsecurities of all companies in a particular sector of the marketto decrease. While the Fund may not concentrate in any oneindustry, the Fund may invest without limitation in a particularmarket sector.

▪ FINANCIAL SECTOR RISK is the risk that the Fund will beimpacted by events affecting the financial sector if itinvests a relatively large percentage of its assets in thatsector, adversely affecting the Fund’s performance. Thefinancial sector can be significantly affected by changes ininterest rates, government regulation, the rate of corporateand consumer debt defaulted, price competitions and theavailability and cost of capital, among other factors.

CYBERSECURITY RISK is the risk of an unauthorized breach andaccess to Fund assets, Fund or customer data (including privateshareholder information), or proprietary information, or therisk of an incident occurring that causes the Fund, theinvestment adviser, sub-advisers, custodian, transfer agent,distributor and other service providers and financialintermediaries to suffer data breaches, data corruption or loseoperational functionality or prevent Fund investors frompurchasing, redeeming or exchanging shares or receivingdistributions. The Fund and its investment adviser have limitedability to prevent or mitigate cybersecurity incidents affectingthird-party service providers, and such third-party serviceproviders may have limited indemnification obligations to theFund or its investment adviser. Successful cyber-attacks orother cyber-failures or events affecting the Fund or its serviceproviders may adversely impact and cause financial losses to theFund or its shareholders. Issuers of securities in which the Fundinvests are also subject to cybersecurity risks, and the value ofthese securities could decline if the issuers experience cyber-attacks or other cyber-failures.

LARGE CAP STOCK RISK is the risk that large-capitalizationstocks as a group could fall out of favor with the market,causing the fund to underperform investments that focus solelyon small- or medium-capitalization stocks. In addition, largercompanies may grow more slowly or be slower to respond tobusiness developments than smaller companies.

LARGE SHAREHOLDER RISK is the risk that the Fund mayexperience adverse effects when certain large shareholders,including funds or accounts over which the Fund’s investmentadviser or an affiliate of the investment adviser has investmentdiscretion, purchase or redeem large amounts of shares of theFund. Such large shareholder redemptions, which may occurrapidly and unexpectedly, may cause the Fund to sell itssecurities at times it would not otherwise do so, which maynegatively impact its liquidity and/or NAV. Such sales may alsoaccelerate the realization of taxable income to shareholders ifthese sales result in gains, and may also increase transaction

costs. In addition, large redemptions could lead to an increasein the Fund’s expense ratio due to expenses being allocated overa smaller asset base. Large purchases of the Fund’s shares mayalso adversely affect the Fund’s performance to the extent thatthe Fund is delayed in investing new cash or otherwisemaintains a larger cash position than it ordinarily would.













-20

-10

0

10

20

30

40

2010 2011 2012 2013 2014 2015 2016

29.05%

22.93%

2018 20192017

(15.14)%

(5.81)%

12.14%

17.76%15.77%

(1.16)%

(13.74)%

(5.15)%

* Year to date total return for the six months ended June 30, 2020 is(11.16)%. For the periods shown in the bar chart above, the highestquarterly return was 15.04% in the third quarter of 2010, and thelowest quarterly return was (19.74)% in the third quarter of 2011.



SinceInception

Active M InternationalEquity Fund 6/22/06


Returns after taxeson distributions 21.52% 4.48% 4.18% 2.76%

Returns after taxeson distributions andsale of Fund shares 14.93% 4.06% 3.74% 2.59%

MSCI World® ex USAIM Index (reflects nodeduction for fees,expenses, or taxes) 22.91% 5.79% 5.66% 3.87%



M A N A G E M E N T


SUB-ADVISERS. NTI, an indirect subsidiary of Northern TrustCorporation, serves as the investment adviser of the Active MInternational Equity Fund. Christopher E. Vella, CFA, a SeniorVice President of NTI, has been manager of the Fund sinceJanuary 2012. Causeway Capital Management LLC, VictoryCapital Management Inc., WCM Investment Management,LLC and Wellington Management Company LLP each serves asa sub-adviser of the Fund. The Northern Trust Company, anaffiliate of NTI, serves as transfer agent, custodian andsub-administrator to the Fund.




▪ By Mail – Send a written request to: Northern Funds, P.O.Box 75986, Chicago, Illinois 60675-5986.



▪ By Systematic Withdrawal – If you own shares of the Fundwith a minimum value of $10,000, you may elect to have afixed sum redeemed at regular intervals and distributed incash or reinvested in one or more other funds of the Trust.Call 800-595-9111 for an application form and additionalinformation. The minimum amount is $250 per withdrawal.




▪ By Exchange – Complete the Exchange Privilege section of yourNew Account Application to exchange shares of one fund in theTrust for shares of another fund in the Trust. Shares beingexchanged must have a value of at least $1,000 ($2,500 if a newaccount is being established by the exchange, $500 if the newaccount is an IRA). Call 800-595-9111 for more information.





F I N A N C I A L INTERMEDIARIES




M U L T I - M A N A G E R E M E R G I N G M A R K E T S D E B T O P P O R T U N I T Y F U N D


The Fund seeks total return consisting of a combination ofincome and capital appreciation.

















E X A M P L E

The following Example is intended to help you compare thecost of investing in the Fund with the cost of investing in othermutual funds. The Example assumes that you invest $10,000 inthe Fund for the time periods indicated and then redeem all ofyour shares at the end of those periods. The Example alsoassumes that your investment has a 5% return each year and

that the Fund’s operating expenses remain the same. Althoughyour actual costs may be higher or lower, based on theseassumptions your costs would be:


$96 $315 $551 $1,230



In seeking to achieve total return, the Fund will invest, undernormal circumstances, at least 80% of its net assets (plusborrowings for investment purposes) in fixed income securitiesthat provide exposure to debt issuers based in or economicallytied to emerging or frontier markets. Emerging and frontiermarkets are defined as those identified by the World BankGroup as being “developing or emerging economies” or areincluded in the JP Morgan EMBI Global Diversified Index and/or the JP Morgan GBI-EM Global Diversified Index. As ofMay 31, 2020, the indices were comprised of markets in 76different countries located in Central and South America,Africa, Eastern Europe, Russia, the Caribbean and Asia. TheFund may invest in companies of any size or securities locatedin a number of countries throughout the world. The Fund mayinvest without limitation in securities denominated in foreigncurrencies and in U.S. dollar denominated securities ofemerging and frontier markets issuers. The securities in whichthe Fund may invest include the following:

▪ obligations of sovereign nations or their agencies,instrumentalities, or sponsored enterprises;

▪ obligations of corporations and banks;

▪ senior subordinated bonds and debentures;

▪ zero coupon, pay-in-kind and capital appreciation bonds;

▪ preferred stock, convertible securities and warrants, rights andother equity securities that are acquired in connection withconvertible securities;

▪ entities organized to restructure the outstanding debt ofemerging and frontier market issuers;

▪ structured securities and short sales; and

▪ repurchase agreements related to the above instruments.




Although the Fund invests primarily in the debt obligations ofemerging and frontier markets issuers, it may makeinvestments in the securities of developed market issuers orcurrency instruments. Currency instruments may includeforeign exchange forwards, futures contracts or options oncurrency. The Fund may invest in structured securities orderivatives, including but not limited to credit linked notes,financial future contracts and swap contracts for hedgingpurposes or to gain exposure to certain countries or currencies.A portion of the Fund’s net assets may be “illiquid securities,”i.e. securities that do not have a readily available market or thatare subject to resale restrictions.

The Fund may invest in higher risk, below investment-gradedebt securities, commonly referred to as “junk bonds.” Lowerquality securities are rated BB, Ba or lower by a NationallyRecognized Statistical Rating Organization (“NRSRO”).Unrated securities will be of comparable quality as determinedby each sub-adviser. There is no minimum rating for a securitypurchased or held by the Fund, and the Fund may purchasesecurities in default.

The Fund is classified as non-diversified under the InvestmentCompany Act of 1940, as amended (the “1940 Act”), and mayinvest more of its assets in fewer issuers than “diversified”mutual funds.


When determining the allocations and reallocations tosub-advisers, the Fund’s investment adviser will consider avariety of factors, including but not limited to the sub-adviser’sinvestment approach, historical performance, and thecharacteristics of each sub-adviser’s allocated assets (includingcapitalization, growth and profitability measures, valuationmetrics, economic sector exposures, and earnings and volatilitystatistics). The Fund’s investment adviser seeks, through itsselection of sub-advisers and its allocation determinations, toreduce portfolio volatility and provide an attractivecombination of risk and return for the Fund.

The Fund intends to be fully invested at all times. However, fortemporary defensive purposes and pending investment moneyreceived for share purchases or to facilitate Fund redemptions,the Fund may invest up to 100% of its assets in cash, highquality short-term investments and repurchase agreements. Tothe extent that the Fund is invested in these instruments, theFund will not be pursuing its investment objective.

The sub-advisers may engage in active trading, and will notconsider portfolio trading a limiting factor in making decisionsfor the Fund.




EMERGING MARKETS RISK is the risk that markets of emergingmarket countries are less developed and less liquid, subject togreater price volatility and generally subject to increasedeconomic, political, regulatory and other uncertainties thanmore developed markets.

▪ FOREIGN SECURITIES RISK is the risk that investing inforeign (non-U.S.) securities may result in the Fundexperiencing more rapid and extreme changes in valuethan a fund that invests exclusively in securities of U.S.companies, due to less liquid markets, and adverseeconomic, political, diplomatic, financial, and regulatory




factors. Foreign governments also may impose limits oninvestment and repatriation and impose taxes. Any ofthese events could cause the value of the Fund’sinvestments to decline. To the extent that the Fund’s assetsare concentrated in a single country or geographic region,the Fund will be subject to the risks associated with thatparticular country or region.



▪ GEOGRAPHIC RISK is the risk that if the Fund invests asignificant portion of its total assets in certain issuers withinthe same geographic region, an adverse economic, businessor political development affecting that region may affect thevalue of the Fund’s investments more, and the Fund’sinvestments may be more volatile, than if its investmentswere not so concentrated in such geographic region.

▪ FRONTIER MARKETS RISK is the risk that frontier countriesgenerally have smaller economies or less developed capitalmarkets than traditional emerging markets and, as a result,the risks of investing in emerging market countries aremagnified in frontier market countries.

▪ SOVEREIGN DEBT RISK is the risk that the Fund may investin securities issued or guaranteed by foreign governmentalentities (known as sovereign debt securities). Theseinvestments are subject to the risk of payment delays ordefaults, due, for example, to cash flow problems,insufficient foreign currency reserves, politicalconsiderations, large debt positions relative to thecountry’s economy or failure to implement economicreforms. There is no legal or bankruptcy process forcollecting sovereign debt.

HIGH-YIELD RISK is the risk that the Fund’s non-investmentgrade fixed-income securities, sometimes known as “junkbonds,” will be subject to greater credit risk, price volatility andrisk of loss than investment grade securities, which canadversely impact the Fund’s return and NAV. High yieldsecurities are considered highly speculative and are subject toincreased risk of an issuer’s inability to make principal andinterest payments.

▪ CREDIT (OR DEFAULT) RISK is the risk that the inability orunwillingness of an issuer or guarantor of a fixed-incomesecurity, or a counterparty to a repurchase or othertransaction, to meet its principal and interest payments orother financial obligations will adversely affect the value ofthe Fund’s investments and its returns. The credit qualityof a debt security or of the issuer of a debt security held bythe Fund could deteriorate rapidly, which may impair theFund’s liquidity or cause a deterioration in the Fund’sNAV. The Fund could also be delayed or hindered in itsenforcement of rights against an issuer, guarantor orcounterparty.

DERIVATIVES RISK is the risk that derivatives may pose risks inaddition to and greater than those associated with investingdirectly in securities, currencies and other instruments, may beilliquid or less liquid, more volatile, more difficult to value andleveraged so that small changes in the value of the underlyinginstrument may produce disproportionate losses to the Fund.Derivatives are also subject to counterparty risk, which is therisk that the other party to the transaction will not perform itscontractual obligation. The use of derivatives is a highlyspecialized activity that involves investment techniques andrisks different from those associated with investments in moretraditional securities and instruments.

▪ FORWARD CURRENCY CONTRACTS RISK is the risk that, ifforward prices increase, a loss will occur to the extent thatthe agreed upon purchase price of the currency exceeds theprice of the currency that was agreed to be sold.

NON-DIVERSIFICATION RISK is the risk that, because the Fundis non-diversified and may invest a larger percentage of itsassets in the securities of fewer issuers than a diversified fund,the Fund’s performance will be more vulnerable to changes in




the market value of a single issuer or group of issuers, and moresusceptible to risks associated with a single economic, politicalor regulatory occurrence.



DEBT EXTENSION RISK is the risk that an issuer will exercise itsright to pay principal on an obligation held by the Fund (suchas an asset-backed security) later than expected. This mayhappen during a period of rising interest rates. Under thesecircumstances, the value of the obligation will decrease and theFund will suffer from the inability to invest in higher yieldingsecurities.

INTEREST RATE RISK is the risk that during periods of risinginterest rates, the Fund’s yield (and the market value of itssecurities) will tend to be lower than prevailing market rates; inperiods of falling interest rates, the Fund’s yield (and themarket value of its securities) will tend to be higher. Securitieswith longer maturities tend to be more sensitive to changes ininterest rates, causing them to be more volatile than securitieswith shorter maturities. Securities with shorter maturities tendto provide lower returns and be less volatile than securities withlonger maturities. If interest rates rise, the Fund’s yield may notincrease proportionately, and the maturities of incomesecurities that have the ability to be prepaid or called by theissuer may be extended. Changing interest rates may haveunpredictable effects on the markets and the Fund’sinvestments. Recent and any future declines in interest ratelevels could cause the Fund’s earnings to fall below the Fund’sexpense ratio, resulting in a decline in the Fund’s share price. Ageneral rise in interest rates may cause investors to move out offixed income securities on a large scale, which could adverselyaffect the price and liquidity of fixed income securities andcould also result in increased redemptions for the Fund.Fluctuations in interest rates may also affect the liquidity offixed income securities and instruments held by the Fund.

CYBERSECURITY RISK is the risk of an unauthorized breach andaccess to Fund assets, Fund or customer data (including privateshareholder information), or proprietary information, or therisk of an incident occurring that causes the Fund, theinvestment adviser, sub-advisers, custodian, transfer agent,distributor and other service providers and financialintermediaries to suffer data breaches, data corruption or loseoperational functionality or prevent Fund investors from

purchasing, redeeming or exchanging shares or receivingdistributions. The Fund and its investment adviser have limitedability to prevent or mitigate cybersecurity incidents affectingthird-party service providers, and such third-party serviceproviders may have limited indemnification obligations to theFund or its investment adviser. Successful cyber-attacks orother cyber-failures or events affecting the Fund or its serviceproviders may adversely impact and cause financial losses to theFund or its shareholders. Issuers of securities in which the Fundinvests are also subject to cybersecurity risks, and the value ofthese securities could decline if the issuers experience cyber-attacks or other cyber-failures.

LARGE SHAREHOLDER RISK is the risk that the Fund mayexperience adverse effects when certain large shareholders,including funds or accounts over which the Fund’s investmentadviser or an affiliate of the investment adviser has investmentdiscretion, purchase or redeem large amounts of shares of theFund. Such large shareholder redemptions, which may occurrapidly and unexpectedly, may cause the Fund to sell itssecurities at times it would not otherwise do so, which maynegatively impact its liquidity and/or NAV. Such sales may alsoaccelerate the realization of taxable income to shareholders ifthese sales result in gains, and may also increase transactioncosts. In addition, large redemptions could lead to an increasein the Fund’s expense ratio due to expenses being allocated overa smaller asset base. Large purchases of the Fund’s shares mayalso adversely affect the Fund’s performance to the extent thatthe Fund is delayed in investing new cash or otherwisemaintains a larger cash position than it ordinarily would.

LIQUIDITY RISK is the risk that the Fund will not be able to payredemption proceeds in a timely manner because of unusualmarket conditions, an unusually high volume of redemptionrequests, legal restrictions impairing its ability to sell particularsecurities or close out derivative positions at an advantageousmarket price or other reasons. Certain securities may be lessliquid than others, which may make them difficult orimpossible to sell at the time and the price that the Fund wouldlike and the Fund may have to lower the price, sell othersecurities instead or forgo an investment opportunity. Inaddition, less liquid securities may be more difficult to valueand markets may become less liquid when there are fewerinterested buyers or sellers or when dealers are unwilling orunable to make a market for certain securities. For these samereasons, less liquid securities that the Fund may want to investin may be difficult or impossible to purchase. Bankingregulations may also cause certain dealers to reduce theirinventories of certain securities, which may further decrease theFund’s ability to buy or sell such securities. All of these risksmay increase during periods of market turmoil and could havea negative effect on the Fund’s performance.





STRUCTURED SECURITIES RISK is the risk that loss may resultfrom the Fund’s investments in structured securities.Structured securities may be more volatile, less liquid and moredifficult to price accurately than less complex securities due totheir derivative nature. As a result, investments in structuredsecurities may adversely affect the Fund’s NAV. In some cases,it is possible that the Fund may suffer a total loss on itsinvestment in a structured security.



The bar chart and table that follow provide an indication of therisks of investing in the Fund by showing (A) changes in theperformance of the Fund from year to year, and (B) how theaverage annual total returns of the Fund compares to those of abroad-based securities market index and to a custom blendedbenchmark that reflect the investment instruments in which theFund invests.




-15

-10

-5

0

5

10

15

2014 2015 2016 2017 20192018

(2.34)%

(8.72)%

7.92%

12.29%11.27%

(6.29)%

* Year to date total return for the six months ended June 30, 2020 is(8.00)%. For the periods shown in the bar chart above, the highestquarterly return was 5.71% in the first quarter of 2016, and thelowest quarterly return was (7.92)% in the second quarter of 2018.


InceptionDate 1-Year 5-Year

SinceInception

Multi-Manager Emerging MarketsDebt Opportunity Fund 12/3/13

Returns before taxes 11.27% 2.90% 2.06%

Returns after taxes ondistributions 10.77% 1.96% 0.88%

Returns after taxes ondistributions and sale of Fundshares 6.67% 1.79% 1.03%

JP Morgan EMBI Global DiversifiedIndex (reflects no deduction forfees, expenses, or taxes) 14.42% 5.88% 5.96%

JP Morgan GBI—EM GlobalDiversified Index (reflects nodeduction for fees, expenses, ortaxes) 13.47% 2.78% 1.33%

50% JP Morgan EMBI GlobalDiversified Index and 50% JPMorgan GBI-EM Global DiversifiedIndex (reflects no deduction forfees, expenses, or taxes) 14.31% 4.57% 3.97%


In calculat ing the federal income taxes due on redemptions, capitalgains taxes result ing from redemptions are subtracted from theredemption proceeds and the tax benefi ts from capital losses result ingfrom the redemptions are added to the redemption proceeds. Undercertain circumstances, the addit ion of the tax benefi ts from capitallosses result ing from redemptions may cause the Returns after taxeson distr ibut ions and sale of Fund shares to be greater than theReturns after taxes on distr ibut ions or even the Returns before taxes.




M A N A G E M E N T


SUB-ADVISERS. NTI, an indirect subsidiary of Northern TrustCorporation, serves as the investment adviser of the Multi-Manager Emerging Markets Debt Opportunity Fund.Christopher E. Vella, CFA, a Senior Vice President of NTI, hasbeen manager of the Fund since December 2013. AshmoreInvestment Management Limited and Global Evolution USA,LLC each serves as a sub-adviser of the Fund. The NorthernTrust Company, an affiliate of NTI, serves as transfer agent,custodian and sub-administrator to the Fund.






▪ By Wire – Authorize wire redemptions on your New AccountApplication and have proceeds sent by federal wire transfer toa previously designated bank account (the minimumredemption amount by this method is $250). You will becharged $15 for each wire redemption unless the designated

bank account is maintained at Northern Trust or an affiliatedbank. Call 800-595-9111 for instructions.



▪ By Internet – You may initiate transactions between NorthernTrust banking and Fund accounts by using Northern TrustPrivate Passport. For details and to sign up for this service, go tonortherntrust.com/funds or contact your Relationship Manager.


The Fund’s distributions are generally taxable to you asordinary income, capital gains, or a combination of the two,unless you are investing through a tax-exempt or tax-deferredarrangement, such as a 401(k) plan or an individual retirementaccount. Distributions may be taxable upon withdrawal fromtax-deferred accounts.


F I N A N C I A L I N T E R M E D I A R I E S




M U L T I - M A N A G E R G L O B A L L I S T E D I N F R A S T R U C T U R E F U N D


The Fund seeks total return through both income and capitalappreciation.











Acquired Fund Fees & Expenses(2) 0.01%

Total Annual Fund Operating Expenses 0.98%

Expense Reimbursement(3) 0.00%

Total Annual Fund Operating Expenses After ExpenseReimbursement(3) 0.98%

(1) Other Expenses have been restated to reflect current fees.

(2) Acquired Fund Fees and Expenses are expenses incurred indirectly by the Fundthrough its ownership of shares in other investment companies. They are notdirect costs paid by Fund shareholders.


E X A M P L E

The following Example is intended to help you compare thecost of investing in the Fund with the cost of investing in othermutual funds. The Example assumes that you invest $10,000 inthe Fund for the time periods indicated and then redeem all ofyour shares at the end of those periods. The Example alsoassumes that your investment has a 5% return each year andthat the Fund’s operating expenses remain the same. Although

your actual costs may be higher or lower, based on theseassumptions your costs would be:


$100 $312 $542 $1,201



In seeking to achieve total return, the Fund will invest, undernormal circumstances, at least 80% of its net assets (plusborrowings for investment purposes) in securities ofinfrastructure companies listed on a domestic or foreignexchange. The Fund invests primarily in equity securities,including common stock and preferred stock, of infrastructurecompanies. Under normal circumstances, the Fund will investat least 40%, and may invest up to 100%, of its net assets in thesecurities of infrastructure companies economically tied to aforeign (non-U.S.) country, including emerging and frontiermarket countries. The Fund may invest in large, medium orsmall capitalization infrastructure companies.

The Fund considers a company to be engaged in theinfrastructure business if it derives at least 50% of its revenuesor earnings from, or devotes at least 50% of its assets to,infrastructure-related activities. The Fund defines“infrastructure” as the systems and networks of energy,transportation, utilities, communication and other servicesrequired for the normal function of society. Infrastructurecompanies are involved in, among other things: (1) thegeneration, transmission and distribution of electric energy;(2) the storage, transportation and distribution of naturalresources, such as natural gas, used to produce energy;(3) alternative energy sources; (4) the building, operation andmaintenance of highways, toll roads, tunnels, bridges andparking lots; (5) the building, operation and maintenance ofairports and ports, railroads and mass transit systems;(6) telecommunications, including wireless and cable networks;(7) water treatment and distribution; and (8) other publicservices such as health care and education. Infrastructurecompanies also include energy-related companies organized asmaster limited partnerships (“MLPs”) and their affiliates,although the Fund will not invest more than 25% of its net




assets in such energy-related MLPs and their affiliates. TheFund expects to invest a significant portion of its assets ininfrastructure companies operating in the utilities, industrialsand/or energy sectors.

The Fund may enter into spot and foreign currency exchangecontracts to facilitate settlement of securities transactions.

A portion of the Fund’s net assets may be “illiquid securities,”i.e., securities that the Fund reasonably expects cannot be soldor disposed of in current market conditions within sevencalendar days or less without the sale or dispositionsignificantly changing the market value of the investment.

The Fund is classified as non-diversified under the InvestmentCompany Act of 1940, as amended (the “1940 Act”), and mayinvest more of its assets in fewer issuers than “diversified”mutual funds.


When determining the allocations and reallocations tosub-advisers, the Fund’s investment adviser will consider avariety of factors, including but not limited to the sub-adviser’sinvestment approach, historical performance, and thecharacteristics of each sub-adviser’s allocated assets (includingcapitalization, growth and profitability measures, valuationmetrics, economic sector exposures, and earnings and volatilitystatistics). The Fund’s investment adviser seeks, through itsselection of sub-advisers and its allocation determinations, toreduce portfolio volatility and provide an attractivecombination of risk and return for the Fund.

The Fund intends to be fully invested at all times. However, fortemporary defensive purposes and pending investment moneyreceived for share purchases or to facilitate Fund redemptions,the Fund may invest up to 100% of its assets in cash, highquality short-term investments and repurchase agreements. Tothe extent that the Fund is invested in these instruments, theFund will not be pursuing its investment objective.





INFRASTRUCTURE COMPANIES RISK Infrastructure companiesare subject to the risk that: the potential for realized revenuevolumes is significantly lower than projected and/or there willbe cost overruns; project sponsors will alter their terms makinga project no longer economical; macroeconomic factors such aslow gross domestic product (“GDP”) growth or high nominalinterest rates will raise the average cost of funding; governmentregulation may affect rates charged to customers; governmentbudgetary constraints will impact projects; special tariffs will beimposed; and changes in tax laws, regulatory policies oraccounting standards could be unfavorable. Other risks includeenvironmental damage due to a company’s operations or anaccident, changes in market sentiment towards infrastructureand terrorist acts.




▪ MARKET SEGMENT RISK is the risk that concentrating in aparticular segment of the market will generally be morevolatile than investing more broadly. Any market pricemovements, regulatory or technological changes, oreconomic conditions affecting infrastructure companiesmay have a significant impact on the Fund’s performance.



▪ EMERGING MARKETS RISK is the risk that markets ofemerging market countries are less developed and lessliquid, subject to greater price volatility and generallysubject to increased economic, political, regulatory andother uncertainties than more developed markets.

▪ FOREIGN CUSTODY RISK. The Fund may hold foreignsecurities and cash with foreign banks, agents, andsecurities depositories appointed by the Fund’s custodian(each a “Foreign Custodian”). Some Foreign Custodiansmay be recently organized or new to the foreign custodybusiness. In some countries, Foreign Custodians may besubject to little or no regulatory oversight over orindependent evaluation of their operations. Further, thelaws of certain countries may place limitations on theFund’s ability to recover its assets if a Foreign Custodianenters bankruptcy. Investments in emerging markets maybe subject to even greater custody risks than investmentsin more developed markets. Custody services in emergingmarket countries are very often undeveloped and may be

considerably less well-regulated than in more developedcountries, and thus may not afford the same level ofinvestor protection as would apply in developed countries.

▪ FRONTIER MARKETS RISK is the risk that frontier countriesgenerally have smaller economies or less developed capitalmarkets than traditional emerging markets and, as a result,the risks of investing in emerging market countries aremagnified in frontier market countries.

CONCENTRATION RISK is the risk that because the Fund willinvest more than 25% of its net assets (plus the amount of anyborrowing for investment purposes) in securities in theinfrastructure business, as defined in this Prospectus, the Fundmay be subject to greater volatility with respect to its portfoliosecurities than a fund that is more broadly diversified.

NON-DIVERSIFICATION RISK is the risk that, because the Fundis non-diversified and may invest a larger percentage of itsassets in the securities of fewer issuers than a diversified fund,the Fund’s performance will be more vulnerable to changes inthe market value of a single issuer or group of issuers, and moresusceptible to risks associated with a single economic, politicalor regulatory occurrence.




SECTOR RISK is the risk that companies in similar businessesmay be similarly affected by particular economic or marketevents, which may, in certain circumstances, cause the value ofsecurities of all companies in a particular sector of the marketto decrease. While the Fund may not concentrate in any oneindustry, the Fund may invest without limitation in a particularmarket sector.

CYBERSECURITY RISK is the risk of an unauthorized breach andaccess to Fund assets, Fund or customer data (including privateshareholder information), or proprietary information, or therisk of an incident occurring that causes the Fund, theinvestment adviser, sub-advisers, custodian, transfer agent,




distributor and other service providers and financialintermediaries to suffer data breaches, data corruption or loseoperational functionality or prevent Fund investors frompurchasing, redeeming or exchanging shares or receivingdistributions. The Fund and its investment adviser have limitedability to prevent or mitigate cybersecurity incidents affectingthird-party service providers, and such third-party serviceproviders may have limited indemnification obligations to theFund or its investment adviser. Successful cyber-attacks orother cyber-failures or events affecting the Fund or its serviceproviders may adversely impact and cause financial losses to theFund or its shareholders. Issuers of securities in which the Fundinvests are also subject to cybersecurity risks, and the value ofthese securities could decline if the issuers experience cyber-attacks or other cyber-failures.

DERIVATIVES RISK is the risk that derivatives may pose risks inaddition to and greater than those associated with investingdirectly in securities, currencies and other instruments, may beilliquid or less liquid, more volatile, more difficult to value andleveraged so that small changes in the value of the underlyinginstrument may produce disproportionate losses to the Fund.Derivatives are also subject to counterparty risk, which is therisk that the other party to the transaction will not perform itscontractual obligation. The use of derivatives is a highlyspecialized activity that involves investment techniques andrisks different from those associated with investments in moretraditional securities and instruments.

▪ FORWARD CURRENCY CONTRACTS RISK is the risk that, ifforward prices increase, a loss will occur to the extent thatthe agreed upon purchase price of the currency exceeds theprice of the currency that was agreed to be sold.

LARGE CAP STOCK RISK is the risk that large-capitalizationstocks as a group could fall out of favor with the market,causing the Fund to underperform investments that focussolely on small- or medium-capitalization stocks. In addition,larger companies may grow more slowly or be slower torespond to business developments than smaller companies.

LARGE SHAREHOLDER RISK is the risk that the Fund mayexperience adverse effects when certain large shareholders,including funds or accounts over which the Fund’s investmentadviser or an affiliate of the investment adviser has investmentdiscretion, purchase or redeem large amounts of shares of theFund. Such large shareholder redemptions, which may occurrapidly and unexpectedly, may cause the Fund to sell itssecurities at times it would not otherwise do so, which maynegatively impact its liquidity and/or NAV. Such sales may alsoaccelerate the realization of taxable income to shareholders ifthese sales result in gains, and may also increase transactioncosts. In addition, large redemptions could lead to an increasein the Fund’s expense ratio due to expenses being allocated over

a smaller asset base. Large purchases of the Fund’s shares mayalso adversely affect the Fund’s performance to the extent thatthe Fund is delayed in investing new cash or otherwisemaintains a larger cash position than it ordinarily would.

LIQUIDITY RISK is the risk that the Fund will not be able to payredemption proceeds in a timely manner because of unusualmarket conditions, an unusually high volume of redemptionrequests, legal restrictions impairing its ability to sell particularsecurities or close out derivative positions at an advantageousmarket price or other reasons. Certain securities may be lessliquid than others, which may make them difficult orimpossible to sell at the time and the price that the Fund wouldlike and the Fund may have to lower the price, sell othersecurities instead or forgo an investment opportunity. Inaddition, less liquid securities may be more difficult to valueand markets may become less liquid when there are fewerinterested buyers or sellers or when dealers are unwilling orunable to make a market for certain securities. For these samereasons, less liquid securities that the Fund may want to investin may be difficult or impossible to purchase. Bankingregulations may also cause certain dealers to reduce theirinventories of certain securities, which may further decrease theFund’s ability to buy or sell such securities All of these risksmay increase during periods of market turmoil and could havea negative effect on the Fund’s performance.



VALUATION RISK is the risk that the sale price the Fund couldreceive for a portfolio security may differ from the Fund’svaluation of the security, particularly for securities that trade inlow volume or volatile markets or that are valued using a fairvalue methodology. Fair valuation of the Fund’s investmentsinvolves subjective judgment. The Fund’s ability to value itsinvestments may be impacted by technological issues and/orerrors by pricing services or other third-party service providers.In addition, the value of the securities in the Fund’s portfolio




may change on days when shareholders will not be able topurchase or sell the Fund’s shares.







-15

-10

-5

0

5

30

25

20

15

10

2013 2014 2015 2016 2018 20192017

(7.86)% (10.28)%

24.28%

7.62%

22.21%

8.99%

24.34%

* Year to date total return for the six months ended June 30, 2020 is(11.79)%. For the period shown in the bar chart above, the highestquarterly return was 11.33% in the first quarter of 2019, and thelowest quarterly return was (5.81)% in the fourth quarter of 2018.


InceptionDate 1-Year 5-Year

SinceInception

Multi-Manager Global ListedInfrastructure Fund 9/18/12

Returns before taxes 24.34% 6.48% 8.86%

Returns after taxes ondistributions 23.82% 5.26% 7.63%

Returns after taxes ondistributions and sale of Fundshares 15.13% 4.89% 6.88%

S&P Global Infrastructure® Index(net dividend return) (reflects nodeduction for fees, expenses, ortaxes) 25.75% 5.61% 7.54%



M A N A G E M E N T


SUB-ADVISERS. NTI, an indirect subsidiary of Northern TrustCorporation, serves as the investment adviser for the Multi-Manager Global Listed Infrastructure Fund. Christopher E.Vella, CFA, a Senior Vice President of NTI, has been managerof the Fund since September 2012. First Sentier Investors(Australia) IM Ltd, Lazard Asset Management LLC and Maple-Brown Abbott Limited each serves as a sub-adviser of the Fund.The Northern Trust Company, an affiliate of NTI, serves astransfer agent, custodian and sub-administrator to the Fund.


You may open an account directly with Northern Funds (the“Trust”) generally with a minimum initial investment of$2,500 in the Fund ($500 for an IRA; $250 under the AutomaticInvestment Plan; and $500 for employees of Northern Trustand its affiliates). The minimum subsequent investment is $50(except for reinvestments of distributions for which there is nominimum). The Fund reserves the right to waive theseminimums. You may also purchase Fund shares through youraccount at Northern Trust (or an affiliate) or an authorizedintermediary.



M U L T I - M A N A G E R G L O B A L R E A L E S T A T E F U N D


The Fund seeks to provide long-term capital appreciation andcurrent income through a diversified portfolio of primarilyequity securities of U.S. and foreign real estate and real estaterelated companies.















(2) Northern Trust Investments, Inc. has contractually agreed to reimburse a por-tion of the operating expenses of the Fund (other than certain exceptedexpenses, i.e., Acquired Fund Fees and Expenses, the compensation paid toeach Independent Trustee of the Trust, expenses of third party consultantsengaged by the Board of Trustees, membership dues paid to the InvestmentCompany Institute and Mutual Fund Directors Forum, expenses in connectionwith the negotiation and renewal of the revolving credit facility, extraordinaryexpenses and interest) to the extent the “Total Annual Fund OperatingExpenses” exceed 0.91%. This contractual limitation may not be terminatedbefore July 31, 2021 without the approval of the Fund’s Board of Trustees.

(3) The Total Annual Fund Operating Expenses After Expense Reimbursement maybe higher than the contractual expense reimbursement rate stated above dueto excepted expenses that are not reimbursed.

E X A M P L E

The following Example is intended to help you compare thecost of investing in the Fund with the cost of investing in othermutual funds. The Example assumes that you invest $10,000 inthe Fund for the time periods indicated and then redeem all of

our shares at the end of those periods. The Example alsoassumes that your investment has a 5% return each year andthat the Fund’s operating expenses remain the same. Althoughyour actual costs may be higher or lower, based on theseassumptions your costs would be:


$96 $332 $586 $1,315



In seeking long-term capital appreciation and current income,the Fund will invest, under normal circumstances, at least 80%of its net assets in equity securities of real estate companies andreal estate related companies (collectively “real estatecompanies”). This means that the Fund will concentrate itsinvestments in companies that derive a significant portion oftheir revenues from the ownership, construction, financing,management or sale of commercial, industrial or residentialreal estate or companies that have a significant portion of theirassets in these types of real estate-related areas. The Fund willinvest in equity-related securities of real estate companies on aglobal basis, which means that the companies may be U.S.companies or foreign companies. There is no limit on theamount of Fund assets that may be invested in the securities offoreign companies. The Fund anticipates that it will investgreater than 25% of its assets in equity-related securities of realestate companies in the U.S. The Fund does not invest directlyin real estate.

The Fund anticipates that its investments in equity-relatedsecurities of real estate companies will be primarily in securitiesof companies known as real estate investment trusts (REITs) orU.S. or non-U.S. REIT-like companies that own and/or manageproperty. The Fund may invest without limit in the securities ofREITs. The Fund may also invest in equity securities of othertypes of real estate companies including REITs that invest inreal estate-related loans and real estate operating companies.

The Fund utilizes a “multi-manager” approach whereby theFund’s assets are allocated to one or more sub-advisers, inpercentages determined at the discretion of the Fund’sinvestment adviser. Each sub-adviser acts independently from




the others and utilizes its own distinct investment style inselecting securities. However, each sub-adviser must operatewithin the constraints of the Fund’s investment objective,strategies and restrictions. When determining the allocationsand reallocations to sub-advisers, the Fund’s investment adviserwill consider a variety of factors, including but not limited tothe sub-adviser’s style, historical performance, and thecharacteristics of each sub-adviser’s allocated assets (includingcapitalization, growth and profitability measures, valuationmetrics, economic sector exposures, and earnings and volatilitystatistics). The Fund’s investment adviser seeks, through itsselection of sub-advisers and its allocation determinations, toreduce portfolio volatility and provide an attractivecombination of risk and return for the Fund.




MARKET RISK is the risk that the value of the Fund’sinvestments may increase or decrease in response to expected,real or perceived economic, political or financial events in theU.S. or global markets. The frequency and magnitude of suchchanges in value cannot be predicted. Certain securities andother investments held by the Fund may experience increasedvolatility, illiquidity, or other potentially adverse effects inresponse to changing market conditions, inflation, changes ininterest rates, lack of liquidity in the bond or equity markets,volatility in the equity markets, market disruptions caused bylocal or regional events such as war, acts of terrorism, thespread of infectious illness (including epidemics andpandemics) or other public health issues, recessions or otherevents or adverse investor sentiment or other political,regulatory, economic and social developments, anddevelopments that impact specific economic sectors, industriesor segments of the market. These risks may be magnified ifcertain events or developments adversely interrupt the globalsupply chain; in these and other circumstances, such risksmight affect companies worldwide due to increasinglyinterconnected global economies and financial markets. Market

risk includes the risk that a particular style of investing, such asgrowth or value, may underperform the market generally.

REAL ESTATE SECURITIES CONCENTRATION RISK is the risk thatinvestments in securities of real estate companies will make theFund more susceptible to risks associated with the ownership ofreal estate and with the real estate industry in general. Realestate companies may have lower trading volumes and may besubject to more abrupt or erratic price movements than theoverall securities markets. The value of real estate securitiesmay underperform other sectors of the economy or broaderequity markets. To the extent that the Fund concentrates itsinvestments in the real estate sector, it may be subject to greaterrisk of loss than if it were diversified across different industrysectors.

▪ REIT RISK is the risk that the Fund’s investments will beaffected by factors affecting real estate investment trusts(“REITs”) and the real estate sector generally. Investing inREITs involves certain unique risks in addition to thoserisks associated with investing in the real estate industry ingeneral. These risks include possible declines in the valueof real estate, possible lack of mortgage funds andunexpected vacancies of properties. REITs that invest inreal estate mortgages are also subject to prepayment risks.REITs whose underlying properties are concentrated in aparticular industry or geographic region are also subject torisks affecting such industries and regions. REITs are alsosubject to heavy cash flow dependency, defaults byborrowers, self-liquidation, interest rate risks (especiallymortgage REITs) and liquidity risk. REITs may havelimited financial resources, may trade less frequently andin lower volume, engage in dilutive offerings or becomemore volatile than other securities. By investing in REITsthrough the Fund, a shareholder will bear expenses of theREITs in addition to expenses of the Fund. In addition,REITs could possibly fail to (i) qualify for favorable taxtreatment under applicable tax law, or (ii) maintain theirexemptions from registration under the InvestmentCompany Act of 1940.









SECTOR RISK is the risk that companies in similar businessesmay be similarly affected by particular economic or marketevents, which may, in certain circumstances, cause the value ofsecurities of all companies in a particular sector of the marketto decrease. While the Fund may not concentrate in any oneindustry, the Fund may invest without limitation in a particularmarket sector.

GEOGRAPHIC RISK is the risk that if the Fund invests asignificant portion of its total assets in certain issuers within thesame geographic region, an adverse economic, business orpolitical development affecting that region may affect the value

of the Fund’s investments more, and the Fund’s investmentsmay be more volatile, than if its investments were not soconcentrated in such geographic.

INTEREST RATE RISK is the risk that during periods of risinginterest rates, the Fund’s yield (and the market value of itssecurities) will tend to be lower than prevailing market rates; inperiods of falling interest rates, the Fund’s yield (and themarket value of its securities) will tend to be higher. Securitieswith longer maturities tend to be more sensitive to changes ininterest rates, causing them to be more volatile than securitieswith shorter maturities. Securities with shorter maturities tendto provide lower returns and be less volatile than securities withlonger maturities. If interest rates rise, the Fund’s yield may notincrease proportionately, and the maturities of incomesecurities that have the ability to be prepaid or called by theissuer may be extended. Changing interest rates may haveunpredictable effects on the markets and the Fund’sinvestments. Recent and any future declines in interest ratelevels could cause the Fund’s earnings to fall below the Fund’sexpense ratio, resulting in a decline in the Fund’s share price. Ageneral rise in interest rates may cause investors to move out offixed income securities on a large scale, which could adverselyaffect the price and liquidity of fixed income securities andcould also result in increased redemptions for the Fund. A lowor declining interest rate environment poses additional risks tothe Fund’s performance, including the risk that proceeds fromprepaid or maturing instruments may have to be reinvested at alower interest rate. Fluctuations in interest rates may also affectthe liquidity of fixed income securities and instruments held bythe Fund.

CYBERSECURITY RISK is the risk of an unauthorized breach andaccess to Fund assets, Fund or customer data (including privateshareholder information), or proprietary information, or therisk of an incident occurring that causes the Fund, theinvestment adviser, sub-advisers, custodian, transfer agent,distributor and other service providers and financialintermediaries to suffer data breaches, data corruption or loseoperational functionality or prevent Fund investors frompurchasing, redeeming or exchanging shares or receivingdistributions. The Fund and its investment adviser have limitedability to prevent or mitigate cybersecurity incidents affectingthird-party service providers, and such third-party serviceproviders may have limited indemnification obligations to theFund or its investment adviser. Successful cyber-attacks orother cyber-failures or events affecting the Fund or its serviceproviders may adversely impact and cause financial losses to theFund or its shareholders. Issuers of securities in which the Fundinvests are also subject to cybersecurity risks, and the value ofthese securities could decline if the issuers experience cyber-attacks or other cyber-failures.




INITIAL PUBLIC OFFERING (“IPO”) RISK is the risk that themarket value of shares in an IPO will fluctuate considerably ordecline shortly after the IPO, due to factors such as the absenceof a prior public market, unseasoned trading, the small numberof shares available for trading and limited information aboutthe issuer.





As with any mutual fund, it is possible to lose money on aninvestment in the Fund. An investment in the Fund is not a

deposit of any bank and is not insured or guaranteed by theFederal Deposit Insurance Corporation, any other governmentagency, or The Northern Trust Company, its affiliates,subsidiaries or any other bank.






-10

0

10

20

30

40

2010 2011 2012 2013 2014 2015 2016 2018 20192017

17.49%

(7.02)%

27.99%

23.70%

1.87%

11.72%

4.30%

(0.92)%(4.57)%

9.67%




SinceInception

Multi-Manager GlobalReal Estate Fund 11/19/08


Returns after taxes ondistributions 21.53% 2.33% 4.79% 9.47%

Returns after taxes ondistributions and saleof Fund shares 14.11% 3.45% 5.42% 9.52%

FTSE® EPRA®/NAREIT®

Developed® Index(reflects no deduction forfees, expenses, or taxes) 21.91% 5.56% 8.37% 12.85%






M A N A G E M E N T


SUB-ADVISERS. NTI, an indirect subsidiary of Northern TrustCorporation, serves as the investment adviser of the Multi-Manager Global Real Estate Fund. Christopher E. Vella, CFA, aSenior Vice President of NTI, has been manager of the Fundsince January 2012. Brookfield Public Securities Group LLCand Massachusetts Financial Services Company each serves as asub-adviser of the Fund. The Northern Trust Company, anaffiliate of NTI, serves as transfer agent, custodian andsub-administrator to the Fund.











The Fund’s distributions are generally taxable to you asordinary income, qualified dividend income, capital gains,section 199A dividends, or a combination of the four, unlessyou are investing through a tax-exempt or tax-deferredarrangement, such as a 401(k) plan or an individual retirementaccount. Distributions may be taxable upon withdrawal fromtax-deferred accounts.






M U L T I - M A N A G E R H I G H Y I E L D O P P O R T U N I T Y F U N D


The Fund seeks total return consisting of a combination ofincome and capital appreciation.

















E X A M P L E

The following Example is intended to help you compare thecost of investing in the Fund with the cost of investing in othermutual funds. The Example assumes that you invest $10,000 inthe Fund for the time periods indicated and then redeem all ofyour shares at the end of those periods. The Example also

assumes that your investment has a 5% return each year andthat the Fund’s operating expenses remain the same. Althoughyour actual costs may be higher or lower, based on theseassumptions your costs would be:


$88 $289 $508 $1,137



In seeking to achieve its investment objective, the Fund willinvest, under normal circumstances, at least 80% of its netassets in bonds and other fixed-income securities that are ratedbelow investment grade (commonly referred to as “junkbonds”). These may include:

▪ Obligations of U.S. and foreign corporations and banks;

▪ Obligations of state, local and foreign governments;

▪ Senior and subordinated bonds and debentures;

▪ Mortgage and other asset-backed securities;

▪ Zero coupon, pay-in-kind and capital appreciation bonds;

▪ Convertible securities, preferred stock, structured securitiesand loan participations; and

▪ Warrants, rights and other equity securities that are acquiredin connection with the Fund’s investments in debt orconvertible securities.

The sub-advisers may shift the Fund’s assets among varioustypes of securities based upon changing market conditions,yield differences and the credit-worthiness of issuers amongother things.

Lower quality securities are rated BB, Ba or lower by aNationally Recognized Statistical Rating Organization(“NRSRO”). Unrated securities will be of comparable quality asdetermined by each sub-adviser. Lower rated securities tend tooffer higher yields than higher rated securities with similarmaturities. However, lower rated securities are consideredspeculative and generally involve greater price volatility andgreater risk of loss than higher rated securities. There is nominimum rating for a security purchased or held by the Fund,




and the Fund may purchase securities that are in default.Although the Fund invests primarily in lower quality fixed-income securities, it may invest a portion of its assets insecurities of higher quality. The Fund does not have anyportfolio maturity limitation, and may invest its assets fromtime to time primarily in instruments with short, medium orlong maturities.

Although the Fund primarily invests in the debt obligations ofdomestic issuers, it may invest in fixed-income securities offoreign issuers, including issuers located in emerging marketcountries. The Fund’s investments in foreign issuers togetherwith notional underlying foreign currency exposure are notexpected to exceed 30%.

A portion of the Fund’s net assets may be “Illiquid securities,”i.e. securities that do not have a readily available market or thatare subject to resale restrictions.


When determining the allocations and reallocations tosub-advisers, the Fund’s investment adviser will consider avariety of factors, including but not limited to the sub-adviser’sinvestment approach, historical performance, and thecharacteristics of each sub-adviser’s allocated assets (includingduration, credit quality, average maturity, industry andgeographic region). The Fund’s investment adviser seeks,through its selection of sub-advisers and its allocationdeterminations, to reduce portfolio volatility and provide anattractive combination of risk and return for the Fund.





HIGH-YIELD RISK is the risk that the Fund’s non-investmentgrade fixed-income securities, sometimes known as “junkbonds,” will be subject to greater credit risk, price volatility andrisk of loss than investment grade securities, which canadversely impact the Fund’s return and NAV. High yieldsecurities are considered highly speculative and are subject tothe increased risk of an issuer’s inability to make principal andinterest payments.

▪ CREDIT (OR DEFAULT) RISK is the risk that the inability orunwillingness of an issuer or guarantor of a fixed-incomesecurity, or a counterparty to a repurchase or othertransaction, to meet its principal and interest payments orother financial obligations will adversely affect the value ofthe Fund’s investments and its returns. The credit qualityof a debt security or of the issuer of a debt security held bythe Fund could deteriorate rapidly, which may impair theFund’s liquidity or cause a deterioration in the Fund’sNAV. The Fund could also be delayed or hindered in itsenforcement of rights against an issuer, guarantor orcounterparty.

▪ LIQUIDITY RISK is the risk that the Fund will not be able topay redemption proceeds in a timely manner because ofunusual market conditions, an unusually high volume ofredemption requests, legal restrictions impairing its abilityto sell particular securities or close out derivative positionsat an advantageous market price or other reasons. Certainsecurities may be less liquid than others, which may make




them difficult or impossible to sell at the time and theprice that the Fund would like and the Fund may have tolower the price, sell other securities instead or forgo aninvestment opportunity. In addition, less liquid securitiesmay be more difficult to value and markets may becomeless liquid when there are fewer interested buyers or sellersor when dealers are unwilling or unable to make a marketfor certain securities. For these same reasons, less liquidsecurities that the Fund may want to invest in may bedifficult or impossible to purchase. Banking regulationsmay also cause certain dealers to reduce their inventoriesof certain securities, which may further decrease theFund’s ability to buy or sell such securities. All of theserisks may increase during periods of market turmoil andcould have a negative effect on the Fund’s performance.

▪ LOAN RISK. Loans may be unrated, less liquid and moredifficult to value than traditional debt securities. Loansmay be made to finance highly leveraged corporateoperations or acquisitions. The highly leveraged capitalstructure of the borrowers in such transactions may makesuch loans especially vulnerable to adverse changes infinancial, economic or market conditions. Loans generallyare subject to restrictions on transfer, and only limitedopportunities may exist to sell such loans in secondarymarkets. As a result, the Fund may be unable to sell loansat a desired time or price. If the Fund acquires only anassignment or a participation in a loan made by a thirdparty, the Fund may not be able to control amendments,waivers or the exercise of any remedies that a lender wouldhave under a direct loan and may assume liability as alender.



INTEREST RATE RISK is the risk that during periods of risinginterest rates, the Fund’s yield (and the market value of itssecurities) will tend to be lower than prevailing market rates; inperiods of falling interest rates, the Fund’s yield (and themarket value of its securities) will tend to be higher. Securitieswith longer maturities tend to be more sensitive to changes ininterest rates, causing them to be more volatile than securitieswith shorter maturities. Securities with shorter maturities tendto provide lower returns and be less volatile than securities withlonger maturities. If interest rates rise, the Fund’s yield may notincrease proportionately, and the maturities of income

securities that have the ability to be prepaid or called by theissuer may be extended. Changing interest rates may haveunpredictable effects on the markets and the Fund’sinvestments. Recent and any future declines in interest ratelevels could cause the Fund’s earnings to fall below the Fund’sexpense ratio, resulting in a decline in the Fund’s share price. Ageneral rise in interest rates may cause investors to move out offixed income securities on a large scale, which could adverselyaffect the price and liquidity of fixed income securities andcould also result in increased redemptions for the Fund.Fluctuations in interest rates may also affect the liquidity offixed income securities and instruments held by the Fund.


ASSET-BACKED SECURITIES RISK. Asset-backed securitiesrepresent interests in pools of assets such as mortgages,commercial or consumer loans, or receivables and otherfinancial assets. Asset-backed securities are subject to credit,interest rate, prepayment, extension, valuation and liquidityrisk. These securities, in most cases, are not backed by the fullfaith and credit of the U.S. government and are subject to therisk of default on the underlying asset or loan, particularlyduring periods of economic downturn. Those asset-backedsecurities that are guaranteed as to the timely payment ofinterest and principal by a government entity, are notguaranteed as to market price, which will fluctuate. Smallmovements in interest rates (both increases and decreases) mayquickly and significantly reduce the value of certain asset-backed securities.

DEBT EXTENSION RISK is the risk that an issuer will exercise itsright to pay principal on an obligation held by the Fund (suchas an asset-backed security) later than expected. This mayhappen during a period of rising interest rates. Under thesecircumstances, the value of the obligation will decrease and theFund will suffer from the inability to invest in higher yieldingsecurities.

CYBERSECURITY RISK is the risk of an unauthorized breach andaccess to Fund assets, Fund or customer data (including privateshareholder information), or proprietary information, or therisk of an incident occurring that causes the Fund, theinvestment adviser, sub-advisers, custodian, transfer agent,




distributor and other service providers and financialintermediaries to suffer data breaches, data corruption or loseoperational functionality or prevent Fund investors frompurchasing, redeeming or exchanging shares or receivingdistributions. The Fund and its investment adviser have limitedability to prevent or mitigate cybersecurity incidents affectingthird-party service providers, and such third-party serviceproviders may have limited indemnification obligations to theFund or its investment adviser. Successful cyber-attacks orother cyber-failures or events affecting the Fund or its serviceproviders may adversely impact and cause financial losses to theFund or its shareholders. Issuers of securities in which the Fundinvests are also subject to cybersecurity risks, and the value ofthese securities could decline if the issuers experience cyber-attacks or other cyber-failures.



▪ FOREIGN CUSTODY RISK. The Fund may hold foreignsecurities and cash with foreign banks, agents, andsecurities depositories appointed by the Fund’s custodian(each a “Foreign Custodian”). Some Foreign Custodiansmay be recently organized or new to the foreign custodybusiness. In some countries, Foreign Custodians may besubject to little or no regulatory oversight over orindependent evaluation of their operations. Further, thelaws of certain countries may place limitations on theFund’s ability to recover its assets if a Foreign Custodian

enters bankruptcy. Investments in emerging markets maybe subject to even greater custody risks than investmentsin more developed markets. Custody services in emergingmarket countries are very often undeveloped and may beconsiderably less well-regulated than in more developedcountries, and thus may not afford the same level ofinvestor protection as would apply in developed countries.


PREPAYMENT (OR CALL) RISK is the risk that an issuer couldexercise its right to pay principal on an obligation held by theFund (such as an asset-backed security) earlier than expected.The exercise of such right may result in a decreased rate ofreturn and a decline in value of those obligations andaccordingly, a decline in the Fund’s NAV. Issuers may be morelikely to prepay when interest rates fall, when credit spreadschange, or when an issuer’s credit quality improves. If thishappens, the Fund may be unable to recoup all of its initialinvestment and will also suffer from having to reinvest in loweryielding securities. The Fund may also lose any premium it paidto purchase the securities.

STRUCTURED SECURITIES RISK is the risk that loss may resultfrom the Fund’s investments in structured securities.Structured securities may be more volatile, less liquid and moredifficult to price accurately than less complex securities due totheir derivative nature. As a result, investments in structuredsecurities may adversely affect the Fund’s NAV. In some cases,it is possible that the Fund may suffer a total loss on itsinvestment in a structured security.








Updated performance information for the Fund is availableand may be obtained on the Fund’s website atnortherntrust.com/funds or by calling 800-595-9111.


-10

-5

5

10

15

20

2016

(5.93)%

2010

12.81%

2011

1.41%

2012

16.65%

2013

6.67%

2014

1.94%

2015

1.94%

2018

(2.09)%

16.89%

2017

0

2019

10.37%




SinceInception

Multi-Manager High YieldOpportunity Fund 9/23/09


Returns after taxes ondistributions 7.38% 2.43% 3.60% 3.82%

Returns after taxes ondistributions and saleof Fund shares 6.09% 2.68% 3.79% 3.97%

ICE BofA U.S. High YieldConstrained Index (reflectsno deduction for fees,expenses, or taxes) 14.41% 6.14% 7.48% 7.92%

After - tax returns are calculated using the historical highest individualfederal marginal income tax rates and do not ref lect the impact ofstate and local taxes. Actual after - tax returns depend on an investor’stax si tuation and may dif fer from those shown. After - tax returns shown

are not relevant to investors who hold their shares throughtax-deferred arrangements, such as 401(k) plans or individualret irement accounts.


M A N A G E M E N T


SUB-ADVISERS. NTI, an indirect subsidiary of Northern TrustCorporation, serves as the investment adviser of the Multi-Manager High Yield Opportunity Fund. Christopher E. Vella,CFA, a Senior Vice President of NTI, has been manager of theFund since January 2012. DDJ Capital Management, LLC,Neuberger Berman Investment Advisers LLC and NomuraCorporate Research and Asset Management Inc. each serves asa sub-adviser of the Fund. The Northern Trust Company, anaffiliate of NTI, serves as transfer agent, custodian andsub-administrator to the Fund.






▪ By Wire – Authorize wire redemptions on your New AccountApplication and have proceeds sent by federal wire transfer toa previously designated bank account (the minimum




redemption amount by this method is $250). You will becharged $15 for each wire redemption unless the designatedbank account is maintained at Northern Trust or an affiliatedbank. Call 800-595-9111 for instructions.





The Fund’s distributions are generally taxable to you asordinary income, capital gains, or a combination of the two,unless you are investing through a tax-exempt or tax-deferredarrangement, such as a 401(k) plan or an individual retirementaccount. Distributions may be taxable upon withdrawal fromtax-deferred accounts.






B R O A D - B A S E D S E C U R I T I E S M A R K E T I N D I C E S

THE ICE BofA U.S. HIGH YIELD CONSTRAINED INDEX containsall securities in the ICE BofA U.S. High Yield Index, but capsissuer exposure to 2%. Index constituents are capitalization-weighted, based on their current amount outstanding, providedthe total allocation to an individual issuer does not exceed 2%.The ICE BofA U.S. High Yield Index tracks the performance ofUS dollar denominated below investment grade corporate debtpublicly issued in the US domestic market. Qualifying securitiesmust have a below investment grade rating (based on anaverage of Moody’s Investors Service, Inc. (“Moody’s”),Standard & Poor’s Global Ratings (“S&P”) and Fitch Ratings(“Fitch”)), at least 18 months to final maturity at the time ofissuance, at least one year remaining term to final maturity asof the rebalancing date, a fixed coupon schedule and aminimum amount outstanding of $100 million.

THE FTSE® EPRA®/NAREIT® DEVELOPED® INDEX is designed totrack the performance of listed real estate companies and REITsworldwide. The index constituents are free-float adjusted andscreened for liquidity, size and revenue. As of May 31, 2020, theFTSE EPRA/NAREIT Developed Index consisted of issuersfrom the following 21 countries: Australia, Austria, Belgium,Canada, Finland, France, Germany, Hong Kong, Ireland, Israel,Italy, Japan, the Netherlands, New Zealand, Norway, Singapore,Spain, Sweden, Switzerland, the United Kingdom and theUnited States.

THE JP MORGAN EMERGING MARKETS BOND INDEX GLOBAL

DIVERSIFIED (EMBI GLOBAL DIVERSIFIED) is a uniquelyweighted USD-denominated emerging markets sovereign bondindex. The EMBI Global Diversified has the same instrumentcomposition as the market-capitalization weighted EMBIGlobal, which includes USD-denominated fixed and floatingrate instruments issued by sovereign and quasi-sovereignentities. The EMBI Global opts for an alternative weightingscheme by limiting concentration in larger countries and thustargets a more diversified exposure.

THE JP MORGAN GOVERNMENT BOND-EMERGING MARKET

INDEX GLOBAL DIVERSIFIED (GBI-EM GLOBAL DIVERSIFIED)

tracks the performance of local currency debt issued byemerging market governments. The index incorporates aconstrained market-capitalization methodology in whichindividual issuer exposures are capped at 10% (with the excessdistributed to smaller issuers), for greater diversification amongissuing governments.

THE MSCI WORLD® ex USA IM INDEX is a free float-adjustedmarket capitalization weighted index that is designed tomeasure the equity market performance of developed markets.It captures large, mid and small cap representation across 22developed markets, excluding the United States, and coversapproximately 99% of the free float-adjusted marketcapitalization in each country. As of May 31, 2020 the MSCIWorld ex USA IM Index consisted of the following 22countries: Australia, Austria, Belgium, Canada, Denmark,Finland, France, Germany, Hong Kong, Ireland, Israel, Italy,Japan, Netherlands, New Zealand, Norway, Portugal,Singapore, Spain, Sweden, Switzerland and the UnitedKingdom.

THE MSCI EMERGING MARKETS® INDEX is a free float-adjustedmarket capitalization index that is designed to measure equitymarket performance in global emerging markets. As of May 31,2020, the MSCI Emerging Markets Index consisted of thefollowing 26 emerging market country indices: Argentina,Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece,Hungary, India, Indonesia, Korea, Malaysia, Mexico, Pakistan,Peru, Philippines, Poland, Qatar, Russia, Saudi Arabia, SouthAfrica, Taiwan, Thailand, Turkey, and the United ArabEmirates.

THE MSCI FRONTIER MARKETS® INDEX is a free float-adjustedmarket capitalization index that is designed to track theperformance of a range of equity markets that are now moreaccessible to global investors. It aims to achieve a broadrepresentation of the investment opportunity set while takinginto consideration investability requirements within eachmarket. As of May 31, 2020, the MSCI Frontier Markets Indexconsisted of the following 28 frontier market country indices:Bahrain, Bangladesh, Benin, Burkina Faso, Croatia, Estonia,Guinea-Bissau, Ivory Coast, Jordan, Kazakhstan, Kenya,Kuwait, Lebanon, Lithuania, Mali, Mauritius, Morocco, Niger,Nigeria, Oman, Romania, Senegal, Serbia, Slovenia, Sri Lanka,Togo, Tunisia, and Vietnam.

THE S&P GLOBAL INFRASTRUCTURE® INDEX provides liquid andtradeable exposure to 74 companies from around the worldthat represent the listed infrastructure universe. The Index hasbalanced weights across three distinct infrastructure clusters:Utilities, Transportation and Energy.



I N V E S T M E N T A D V I S E R

This Prospectus describes four equity funds and two fixed-income funds (each a “Fund” and collectively, the “Funds”),which are currently offered by Northern Funds (the “Trust”).Northern Trust Investments, Inc. (“NTI” or the “InvestmentAdviser”), an indirect subsidiary of Northern TrustCorporation, serves as the Investment Adviser of the Funds andis responsible for their overall administration. NTI is located at50 South LaSalle Street, Chicago, Illinois 60603.

NTI is an Illinois State Banking Corporation and an investmentadviser registered under the Investment Advisers Act of 1940, asamended. It primarily manages assets for institutional andindividual separately managed accounts, investment companiesand bank common and collective funds.

Northern Trust Corporation is regulated by the Board ofGovernors of the Federal Reserve System as a financial holdingcompany under the U.S. Bank Holding Company Act of 1956,as amended. Unless otherwise indicated, NTI and TheNorthern Trust Company (“TNTC”) are referred to collectivelyin this Prospectus as “Northern Trust.”

As of June 30, 2020, Northern Trust Corporation, through itsaffiliates, had assets under custody of $9.29 trillion, and assetsunder investment management of $1.26 trillion.

The Funds are managed by the Investment Adviser and one ormore asset managers unaffiliated with the Investment Adviser(each a “Sub-Adviser” and together, the “Sub-Advisers”). TheInvestment Adviser has the ultimate responsibility to overseethe Sub-Advisers, and to recommend their hiring, termination,and replacement, subject to approval by the Trust’s Board ofTrustees. The Investment Adviser is responsible for managingthe Funds during transition periods in which an existingSub-Adviser is terminated and a new Sub-Adviser is hired.Under the Management Agreement with the Trust, the

Investment Adviser, subject to the general supervision of theTrust’s Board of Trustees, is responsible for: (1) selecting theoverall investment strategies of the Funds; (2) recommendingand selecting Sub-Advisers; (3) allocating and reallocatingassets among the Sub-Advisers where a Fund has more thanone Sub-Adviser; (4) monitoring and evaluating Sub-Adviserperformance; (5) implementing procedures to ensure that theSub-Advisers comply with each Fund’s investment objectives,policies and restrictions; and (6) providing administrationservices to the Funds.

I N V E S T M E N T S U B - A D V I S E R S

The Funds have received an exemptive order from the SEC thatpermits the Investment Adviser to engage or terminate aSub-Adviser, and to enter into and materially amend anexisting Sub-Advisory Agreement, upon the approval of theTrust’s Board of Trustees, without obtaining shareholderapproval. The Sub-Advisers will provide investment advisoryservices to the Funds, except for cash management services,which will be provided by the Investment Adviser. TheInvestment Adviser will select Sub-Advisers based upon theSub-Adviser’s skills in managing assets pursuant to particularinvestment styles and strategies. The Investment Adviser willmonitor existing Sub-Advisers based on their investment styles,strategies, and results in managing assets for specific assetclasses. Each Sub-Adviser will have discretion to select portfoliosecurities for its portion of a Fund, but must select thosesecurities according to the Fund’s investment objectives andrestrictions. The current Sub-Advisers for the Funds are setforth on page 39 under the section entitled “FundManagement.”



M A N A G E M E N T F E E S

As compensation for advisory services and administrationservices and the assumption of related expenses, NTI is entitledto a management fee, computed daily and payable monthly, atannual rates set forth in the tables below (expressed as apercentage of each Fund’s respective average daily net assets).The tables also reflect the management fees paid by each of theFunds for the fiscal year ended March 31, 2020 (expressed as apercentage of each Fund’s respective average daily net assets).

NTI has contractually agreed to reimburse a portion of theoperating expenses of each Fund (other than certain fees andexpenses shown in the table under the caption “Fees andExpenses of the Fund” in each Fund’s Fund Summary) so that“Total Annual Fund Operating Expenses After ExpenseReimbursement” do not exceed the amount shown in thefootnote to the table under the caption “Fees and Expenses ofthe Fund” in each Fund’s Fund Summary. The “Total AnnualFund Operating Expenses After Expense Reimbursement” forthe Funds may be higher than the contractual limitation as aresult of certain excepted expenses that are not reimbursed. Thecontractual expense reimbursement arrangement is expected tocontinue until at least July 31, 2021. The contractual expense

reimbursement arrangement will continue automaticallythereafter for periods of one year (each such one-year period, a“Renewal Year”). The arrangement may be terminated, as toany succeeding Renewal Year, by NTI or a Fund upon 60 days’written notice prior to the end of the current Renewal Year.The Board of Trustees may terminate the arrangement at anytime with respect to a Fund if it determines that it is in the bestinterest of the Fund and its shareholders.

NTI may reimburse additional expenses or waive all or aportion of the management fees of the Funds. Any suchadditional expense reimbursement or fee waiver would bevoluntary and could be implemented, increased or decreased,or discontinued at any time.

A discussion regarding the Board of Trustees’ basis for itsapproval of the Funds’ Management Agreement andSub-Advisory Agreements will be available in the Funds’ semi-annual report to shareholders for the six-month period endingSeptember 30, 2020. The Sub-Advisers’ fees are paid by theInvestment Adviser out of its management fee.

Contractual Management Fee RateManagement FeesPaid for Fiscal Year

Ended 3/31/20Fund First $1 Billion Next $1 Billion Over $2 Billion

ACTIVE M EMERGING MARKETS EQUITY 1.08% 1.048% 1.017% 1.08%

ACTIVE M INTERNATIONAL EQUITY 0.82% 0.795% 0.771% 0.82%

MULTI-MANAGER GLOBAL LISTED INFRASTRUCTURE 0.90% 0.873% 0.847% 0.90%

MULTI-MANAGER GLOBAL REAL ESTATE 0.89% 0.863% 0.837% 0.89%

Contractual Management Fee RateManagement FeesPaid for Fiscal Year

Ended 3/31/20Fund First $1.5 Billion Next $1 Billion Over $2.5 Billion

MULTI-MANAGER EMERGING MARKETS DEBTOPPORTUNITY 0.85% 0.825% 0.80% 0.85%

MULTI-MANAGER HIGH YIELD OPPORTUNITY 0.83% 0.805% 0.781% 0.83%



F U N D M A N A G E M E N T

Christopher E. Vella, CFA, a Senior Vice President of NTI, isthe portfolio manager for each of the Funds. Mr. Vella has beenwith Northern Trust since 2004 and has been the ChiefInvestment Officer of the Multi-Manager Solutions Groupsince 2011. Prior to taking on Chief Investment Officerresponsibilities, Mr. Vella was the Global Director ofNorthern’s Manager Research Team.

Additional information about the Fund Manager’scompensation, other accounts managed by the Fund Managerand the Fund Manager’s ownership of securities in the Funds isavailable in the Statement of Additional Information (“SAI”).

THE SUB-ADVISERS TO THE FUNDS

Each Sub-Adviser has full investment discretion and makes alldeterminations with respect to the investment of assets of theFund allocated to it, subject to general supervision of theInvestment Adviser and the Board of Trustees.


ASHMORE INVESTMENT MANAGEMENT LIMITED (“ASHMORE”).

Ashmore has managed a portion of the Fund since March 2020.Ashmore is located at 61 Aldwych, London, United Kingdom.Ashmore was established in 1999 and is focused on investing inemerging market securities for institutional investors. Ashmoreoffers its services through separate accounts, private investmentfunds and mutual funds, a selection of which are registeredunder the Investment Company Act of 1940, as amended.Ashmore is an indirectly held wholly-owned subsidiary ofAshmore Group plc. As of June 30, 2020, Ashmore had $83.6billion in assets under management.

AXIOM INTERNATIONAL INVESTORS LLC (“AXIOM”). Axiomhas managed a portion of the Fund since November 2008.Axiom is a Delaware Limited Liability Company located at 33Benedict Place, 2nd Floor, Greenwich, Connecticut 06830 andwas founded in 1998. As of June 30, 2020, Axiom had assetsunder management of approximately $14.0 billion. Axiomemploys a bottom-up, growth-oriented investment disciplinethat relies on detailed fundamental stock analysis to identifycompanies that are improving more quickly than is generallyexpected in the current operating fundamentals of the business.This discipline is rooted in Axiom’s basic philosophy thatcompanies that report better than expected operating results, orpositive surprises relative to forecasts that are built intoconsensus expectations, will generally outperform. Axiom’sprimary emphasis is therefore to isolate those companies thatare likely to exceed expectations, which it does by identifyingand monitoring the key business drivers of each stock. Axiombelieves that key business drivers are essentially the leadingindicators of earnings and stock price performance.

WESTWOOD GLOBAL INVESTMENTS, LLC (“WESTWOOD”).Westwood has managed a portion of the Fund sinceNovember 2008. Westwood is a Massachusetts Limited LiabilityCompany located at One Financial Center, Suite 1620, Boston,Massachusetts 02111 and was founded in 2003. As of June 30,2020, Westwood had assets under management ofapproximately $8.3 billion. Westwood’s investment strategywith regard to the Fund seeks to achieve long-termperformance driven by a bottom-up stock selection process inglobal emerging markets. Westwood’s basic investmentphilosophy is as follows: 1) investing like everyone else resultsin earning the same returns; 2) superior stock selection isdriven by patient implementation of thorough, bottom-upfundamental research; and 3) a focused portfolio is a result ofconviction. Westwood’s security analysis attempts to identifycompanies that are undervalued on an absolute basis. A focus isplaced on a thorough analysis of the cash flows of a company,how the company generates cash, the sustainability of the cashflow, and how the cash flow is utilized. This process is designedto find a portfolio of higher quality companies with sustainableor improving returns and strong balance sheets.


CAUSEWAY CAPITAL MANAGEMENT LLC (“CAUSEWAY”).Causeway has managed a portion of the Fund since June 2016.Causeway’s principal office is located at 11111 Santa MonicaBoulevard, 15th Floor, Los Angeles, California 90025. Causewaybegan operations as an investment adviser in June 2001. Wheninvesting the Fund’s assets, Causeway follows a value style,performing fundamental research supplemented byquantitative analysis. Beginning with a universe of companiesthroughout the non-U.S. developed and emerging markets,Causeway uses quantitative market capitalization and valuationscreens to narrow the potential investment candidates toapproximately 2,000 securities. To select investments,Causeway then performs fundamental research, which generallyincludes company-specific research, company visits, andinterviews of suppliers, customers, competitors, industryanalysts, and experts.

Causeway also applies a proprietary quantitative risk model toadjust return forecasts based on risk assessments. Using a valuestyle means that Causeway buys stocks that it believes havelower prices than their true worth. For example, stocks may be“undervalued” because the issuing companies are in industriesthat are currently out of favor with investors. However, even inthose industries, certain companies may have high rates ofgrowth of earnings and be financially sound. Causewayconsiders whether a company has each of the following valuecharacteristics in purchasing or selling securities for the fund:(i) low price-to earnings ratio relative to the sector, (ii) high



yield relative to the market, (iii) low price-to-book value ratiorelative to the market, (iv) low price-to-cash flow ratio relativeto the market, and (v) financial strength. The Fund generallyinvests in companies with market capitalizations greater than$5 billion at the time of investment. However, investments maybe in companies with any market capitalization, includingsubsequent investments in companies with marketcapitalizations below $5 billion that were above $5 billion at thetime of initial investment. As of June 30, 2020, Causeway hadapproximately $38.1 billion in assets under management.

VICTORY CAPITAL MANAGEMENT INC. (“VICTORY CAPITAL”)

Victory Capital has managed a portion of the Fund since June2016. Victory Capital is located at 15935 La Cantera Parkway,San Antonio, Texas 78256. Victory Capital is a diversifiedglobal asset manager and manages a portion of the Fundthrough its investment franchise, Trivalent Investments(“Trivalent”). Trivalent employs a bottom-up investmentapproach that emphasizes individual stock selection. Trivalent’sinvestment process uses a combination of quantitative andtraditional qualitative, fundamental analysis to identifyattractive stocks with low relative price multiples and positivetrends in earnings forecasts. As of June 30, 2020, VictoryCapital had approximately $129.1 billion in assets undermanagement and advisement.

WCM INVESTMENT MANAGEMENT, LLC (“WCM”). WCM hasmanaged a portion of the Fund since September 2015. WCM islocated at 281 Brooks Street, Laguna Beach, California 92651.WCM is an independent money management firm founded in1976. WCM provides investment management andsub-advisory services to public as well as various institutionaland sub-advised accounts. WCM’s investment approachfocuses on industry-leading, non-U.S. organizations led byvisionary management teams with sound business strategies.WCM believes that these companies often dominate theirindustry and are likely to continue that domination in thefuture; therefore, WCM’s minimum time horizon is typicallythree to five years. As of June 30, 2020, WCM hadapproximately $58.9 billion in assets under management.

WELLINGTON MANAGEMENT COMPANY LLP (“WELLINGTON”).Wellington has managed a portion of the Fund since October2017. Wellington is a Delaware limited liability partnershipwith principal offices at 280 Congress Street, Boston,Massachusetts 02210. Wellington is a professional investmentcounseling firm that provides investment services to investmentcompanies, employee benefit plans, endowments, foundations,and other institutions. Wellington and its predecessororganizations have provided investment advisory services forover 80 years. Wellington is owned by the partners ofWellington Management Group LLP, a Massachusetts limited

liability partnership. As of June 30, 2020, Wellington and itsinvestment advisory affiliates had investment managementauthority with respect to approximately $1.12 trillion in assets.Wellington’s investment team utilizes bottom-up fundamentalanalysis to identify companies that are trading at significantdiscount relative to their current market price while placing anequal emphasis on companies with strong financials that allowtheir holdings to realize their value over time.

M U L T I - M A N A G E R E M E R G I N G M A R K E T S D E B T

O P P O R T U N I T Y F U N D

ASHMORE. Ashmore has managed a portion of the Fund sinceMarch 2017. For further information regarding Ashmore pleaserefer to the description of Ashmore under Active M. EmergingMarkets Equity Fund in the “Fund Management” section onpage 39.

GLOBAL EVOLUTION USA, LLC (“GLOBAL EVOLUTION”). GlobalEvolution has managed a portion of the Fund since October2017. Global Evolution is a wholly-owned subsidiary of GlobalEvolution Fondsmaeglerselskab A/S, an investmentmanagement company headquartered in Kolding, Denmark.Global Evolution is located at 250 Park Avenue, 19th floor,New York, New York 10177. Global Evolution specializes inemerging markets utilizing a fundamental top-down analysis oflong-term economic and political prospects that enables themto identify attractive investment opportunities and direct theirbottom-up investment approach. The investment team issupported by a fully integrated quantitative risk managementteam and empowered by unique proprietary systems foradvanced portfolio and risk management. As of June 30, 2020,Global Evolution Group had approximately $13.3 billion inassets under management.

M U L T I - M A N A G E R G L O B A L L I S T E D I N F R A S T R U C T U R E

F U N D

FIRST SENTIER INVESTORS (AUSTRALIA) IM LTD (“FIRST

SENTIER”). First Sentier has managed a portion of the Fundsince January 2020. First Sentier is a global investmentmanagement firm located at Level 5 Tower 3, InternationalTowers, 300 Barangaroo Avenue, Barangaroo NSW 2000,Australia. First Sentier seeks to preserve and grow capitalthrough a focus on securities that are attractively valued withsuperior quality and growth characteristics. First Sentier createsa core infrastructure portfolio diversified by region, countryand subsector by investing in companies that own and operateutilities, energy pipelines, transportation and communications.First Sentier targets assets with high barriers to entry, structuralgrowth, strong pricing power, financial strength, managementquality and sustainable culture. First Sentier is wholly-owned



by Mitsubishi UFJ Trust and Banking Corporation. As ofJune 30, 2020, First Sentier had approximately $147.8 billion inassets under management.

LAZARD ASSET MANAGEMENT LLC (“LAZARD”). Lazard hasmanaged a portion of the Fund since March 2013. Lazard is aDelaware limited liability company located at 30 RockefellerPlaza, New York, New York 10112. As of March 31, 2020,Lazard had assets under management of approximately$171.9 billion. Lazard seeks to invest in listed infrastructurecompanies that own and operate physical infrastructure assetssuch as toll roads, airports, gas utilities and railroads. Lazard’spure play definition will lead the manager into assets thatnaturally exhibit fundamental infrastructure characteristics,such as high barriers to entry and relatively inelastic demand.Lazard does not generally hold infrastructure supportcompanies such as construction, steel or engineering firms thatmay raise the volatility and correlation to the overall market.

MAPLE-BROWN ABBOTT LIMITED (“MBA”). MBA has managed aportion of the Fund since December 2016. MBA is located at259 George Street, Sydney, Australia, and had approximately$6.9 billion in assets under management as of June 30, 2020.MBA invests in global listed infrastructure securities that ownand/or operate physical infrastructure assets around the world.MBA considers a narrower range of core infrastructurecompanies with a focus on regulated, contracted andconcessions assets or networks that provide essential services totheir relevant communities and have a strong strategic positionwithin the economy in which they operate, inflation protection,low volatility compared to global equities and a high level ofcorporate governance.


BROOKFIELD PUBLIC SECURITIES GROUP LLC (“BPSG”). BPSGhas managed a portion of the Fund since December 2014.BPSG is a wholly owned subsidiary of Brookfield AssetManagement Inc. (“Brookfield”), a global alternative assetmanager. Brookfield’s public market activities are conducted byBPSG, a registered investment adviser. BPSG’s principal officesare located at Brookfield Place, 250 Vesey Street, New York,New York 10281-1023. BPSG maintains offices and investmentteams in Chicago, Boston and Houston and had approximately$15.6 billion of assets under management as of June 30, 2020.The investment team utilizes a bottom-up, value-orientedapproach complemented by a top-down overlay to manage itsREIT strategies. The team believes that concentrated portfoliosof under-followed, out-of-favor companies backed by deepfundamental research leads to superior excess returns versusthe market and peers. Quality-adjusted valuation screens serveas the starting point for the team’s research efforts. Thesescreens combine traditional valuation screens with subjective/

objective quality scores on management, property factors, andequity characteristics to arrive at a focused list of companies forfurther in-depth fundamental research, as well as whereexisting positions rank versus the available universe of listedreal estate securities. BPSG also draws upon the expertise andknowledge within Brookfield and its affiliates, which providesextensive owner/operator insights into industry drivers andtrends. The Fund may sell a security that becomes overvaluedor no longer offers an attractive risk/reward profile. A securitymay also be sold due to changes in portfolio strategy or cashflow needs.

MASSACHUSETTS FINANCIAL SERVICES COMPANY (“MFS”).MFS has managed a portion of the Fund since January 2018.MFS is located at 111 Huntington Avenue, Boston,Massachusetts 02199. MFS is America’s oldest mutual fundorganization. MFS and its predecessor organizations have ahistory of money management dating from 1924 and thefounding of the first mutual fund. Net assets under themanagement of the MFS organization were approximately$507.2 billion as of May 31, 2020. MFS uses an activebottom-up investment approach to buying and sellinginvestments for the Fund. Investments are selected primarilybased on fundamental analysis of individual issuers and theirpotential in light of their financial condition, and market,economic, political, and regulatory conditions. Factorsconsidered in selecting investments for the Fund may includean issuer’s management ability, cash flows, price/funds fromoperations ratio, dividend yield and payment history, price/NAV ratio, market price, and the ability of an issuer to growfrom operations. MFS may also consider environmental, socialand governance (“ESG”) factors in its fundamental investmentanalysis.


DDJ CAPITAL MANAGEMENT, LLC (“DDJ”). DDJ has managed aportion of the Fund since September 2012. DDJ, aMassachusetts limited liability company, was founded in 1996and is located at 130 Turner Street, Building 3, Suite 600,Waltham, Massachusetts 02453. As of June 30, 2020, DDJ hadassets under management of approximately $7.2 billion. DDJadheres to a value-oriented, bottom-up, fundamentalinvestment philosophy of identifying investment opportunities.

NEUBERGER BERMAN INVESTMENT ADVISERS LLC (“NBIA”).NBIA has managed a portion of the Fund since July 2011. NBIAis a registered investment adviser and is an indirect, whollyowned subsidiary of Neuberger Berman Group LLC (togetherwith NBIA and its other investment adviser affiliates,“Neuberger Berman”). Neuberger Berman was founded in1939. NBIA’s principal office is located at 1290 Avenue of theAmericas, New York, New York 10104. As of June 30, 2020,



Neuberger Berman had $357 billion in assets undermanagement. NBIA bases investment decisions primarily on itsown research, while drawing on dedicated research teamswhose sole purpose is finding attractive investmentopportunities.

NOMURA CORPORATE RESEARCH AND ASSET MANAGEMENT

INC. (“NOMURA”) Nomura has managed a portion of the Fundsince June 2016. Nomura’s principal office is located atWorldwide Plaza, 309 West 49th Street, New York,NY 10019-7316. Nomura was founded in March 1991 as asubsidiary of Nomura Holding America, Inc. and is a registeredinvestment adviser. Nomura is a boutique investmentmanagement firm that specializes in the below investmentgrade credit market, focusing on U.S. and global high yieldbonds and emerging market debt. Nomura believes that a totalreturn approach driven by credit research is the best way togenerate alpha in the high yield market. As of June 30, 2020,Nomura had $25.9 billion in assets under management.



O T H E R F U N D S E R V I C E S

TNTC serves as Transfer Agent and Custodian for each Fund.The Transfer Agent performs various shareholder servicingfunctions, and any shareholder inquiries should be directed toit. TNTC also performs certain administrative services for theFunds pursuant to a sub-administration agreement with NTI.NTI pays TNTC for its sub-administration services out of itsmanagement fees, which do not represent additional expensesto the Funds. TNTC also performs certain administrativeservices for certain sub-advisers pursuant to separateagreements with such sub-advisers.

TNTC, as Transfer Agent, is entitled to transfer agent fees at anannual rate of 0.0385% of the average daily net assets of eachFund. TNTC, as Custodian, receives an amount based on apre-determined schedule of charges approved by the Trust’sBoard of Trustees.

Pursuant to an exemptive order issued by the SEC, TNTC alsomay render securities lending services to the Funds. For suchservices, TNTC would receive a percentage of securities lendingrevenue generated for the Funds. In addition, cash collateralreceived by the Funds in connection with a securities loan maybe invested in shares of other registered or unregistered fundsthat pay investment advisory or other fees to NTI, TNTC or anaffiliate.

Each Fund may invest its uninvested cash in a money marketfund advised by the Investment Adviser or its affiliates.Accordingly, each Fund will bear indirectly a proportionateshare of that money market fund’s operating expenses. These

operating expenses include the management, transfer agent andcustody fees that the money market fund pays to theInvestment Adviser and/or its affiliates. Currently, theuninvested cash of the Funds is invested in the NorthernInstitutional Funds U.S. Government Portfolio. The totalannual portfolio operating expenses after expensereimbursement (other than certain excepted expenses asdescribed in the fees and expenses table of the Portfolio’sprospectus) on any assets invested in the Northern InstitutionalFunds U.S. Government Portfolio are at an annual rate of0.25% of the average daily NAV of those assets. However, to theextent of any duplicative advisory fees, the Investment Adviserwill reimburse each Fund for a portion of the management feesattributable to and payable by the Funds for advisory serviceson any assets invested in the affiliated money market fund.

TNTC, NTI and other Northern Trust affiliates may provideother services to the Funds and receive compensation for suchservices, if consistent with the Investment Company Act of1940, as amended (the “1940 Act”) and the rules, exemptiveorders and no-action letters issued by the SEC thereunder.Unless required, investors in a Fund may or may not receivespecific notice of such additional services and fees.

Shares of the Trust are distributed by Northern FundsDistributors, LLC (“NFD”), Three Canal Plaza, Suite 100,Portland, Maine, 04101. NFD is not affiliated with TNTC, NTIor any other Northern Trust affiliate.



P U R C H A S I N G A N D S E L L I N G S H A R E S

THE TRUST IS A FAMILY OF NO-LOAD MUTUAL FUNDS THAT OFFERS A SELECTION OF FUNDS TO

INVESTORS, EACH WITH A DISTINCT INVESTMENT OBJECTIVE AND RISK/REWARD PROFILE.

The descriptions in the Fund Summaries may help you decidewhether a Fund or Funds fits your investment needs. Keep inmind, however, that no guarantee can be made that a Fundwill meet its investment objective, and no Fund should berelied upon as a complete investment program. The Trust alsooffers other funds, including equity, fixed-income and moneymarket funds, which are described in separate prospectuses.

Please note that the fee and expense information shown under“Fees and Expenses of the Fund” in the Fund Summariesbeginning on page 3 does not reflect any charges that may beimposed by TNTC, its affiliates, financial intermediaries andother institutions on their customers. (For more information,please see “Account Policies and Other Information—Financial Intermediaries” beginning on page 53.)

P U R C H A S I N G S H A R E S

You may purchase shares directly from the Trust or, if youmaintain certain accounts, through Northern Trust andcertain other institutions. With certain limited exceptions, theFunds are generally available only to investors residing in theUnited States or through a United States based financialintermediary and may not be distributed by a foreign financialintermediary. If you have any questions or need assistance inopening an investment account or purchasing shares, call800-595-9111.

O P E N I N G A N A C C O U N T

THROUGH AN AUTHORIZED INTERMEDIARY. The Trust mayauthorize certain institutions acting as financial intermediaries(including banks, trust companies, brokers and investmentadvisers) to accept purchase orders from their customers onbehalf of the Funds. See “Account Policies and OtherInformation—Financial Intermediaries” beginning on page 53for additional information regarding purchases of Fund sharesthrough authorized intermediaries.

DIRECTLY FROM THE FUNDS. You may open a shareholderaccount and purchase shares directly from the Funds with aminimum initial investment per Fund of $2,500 ($500 for anIRA; $250 under the Automatic Investment Plan; and $500 foremployees of Northern Trust and its affiliates). The minimumsubsequent investment is $50 (except for reinvestments ofdistributions for which there is no minimum). The Fundsreserve the right to waive these minimums.

For your convenience, there are a number of ways to investdirectly in the Funds:

B Y M A I L

▪ Read this Prospectus carefully.

▪ Complete and sign the New Account Application.

▪ Enclose a check payable to Northern Funds.

▪ If you are investing on behalf of a corporation or otherentity, your New Account Application must be accompaniedby acceptable evidence of authority (if applicable).

▪ Mail your check, acceptable evidence of authority (ifapplicable) and completed New Account Application to:

Northern FundsP.O. Box 75986Chicago, Illinois 60675-5986

▪ Additional documentation may be required to fulfill therequirements of the “Customer Identification Program”described on page 53.

▪ For overnight delivery use the following address:

Northern Fundsc/o The Northern Trust Company333 South Wabash AveChicago, Illinois 60604

▪ For subsequent investments:

▪ Enclose your check with the investment slip portion of theconfirmation of your previous investment; or

▪ Indicate on your check or a separate piece of paper yourname, address and account number.

All checks must be payable in U.S. dollars and drawn on abank located in the United States. Cash, traveler’s checks,money orders and third party checks are not acceptable.

B Y W I R E O R A U T O M A T E D C L E A R I N G H O U S E ( “ A C H ” )

T R A N S F E R

TO OPEN A NEW ACCOUNT:

▪ For more information or instructions regarding the purchaseof shares, call the Northern Funds Center at 800-595-9111.



▪ Complete a New Account Application and send it to:


TO ADD TO AN EXISTING ACCOUNT:

▪ Have your bank wire federal funds or effect an ACH transfer to:

The Northern Trust CompanyChicago, IllinoisABA Routing No. 0710-00152(Reference 10-Digit Fund account number, with no spaces(e.g., ##########))(Reference Shareholder’s Name)

B Y D I R E C T D E P O S I T

TO PURCHASE ADDITIONAL SHARES:

▪ Determine if your employer has direct deposit capabilitiesthrough the ACH.

▪ Have your employer send payments to:

ABA Routing No. 0710-00152(Reference 10-Digit Fund account number, with no spaces(e.g., ##########))(Reference Shareholder’s Name)

▪ The minimum periodic investment for direct deposit is $50.

B Y A U T O M A T I C I N V E S T M E N T

TO OPEN A NEW ACCOUNT:

▪ Complete a New Account Application, including theAutomatic Investment section.

▪ Send it to:


▪ The minimum initial investment is $250; $50 for monthlyminimum additions.

TO ADD TO AN EXISTING ACCOUNT:

▪ Call 800-595-9111 to obtain an Automatic Investment PlanForm.

▪ The minimum for automatic investment additions is $50.

If you discontinue participation in the plan, the Funds reservethe right to redeem your account involuntarily, upon 30 days’written notice, if the account’s NAV is $1,000 or less.Involuntary redemptions will not be made if the value of sharesin an account falls below the minimum amount solely becauseof a decline in the Fund’s NAV.

B Y D I R E C T E D R E I N V E S T M E N T

You may elect to have your income dividend and capital gaindistributions automatically invested in another Northern Fundsaccount.

▪ Complete the “Choose Your Dividend and Capital GainDistributions” section on the New Account Application.

▪ Reinvestments can only be directed to an existing NorthernFunds account (which must meet the minimum investmentrequirement).

B Y E X C H A N G E

You may open a new account or add to an existing account byexchanging shares of one fund of the Trust for shares of any otherfund offered by the Trust. See “Selling Shares—By Exchange.”

B Y I N T E R N E T

You may initiate transactions between Northern Trust bankingand Northern Funds accounts by using Northern Trust PrivatePassport. For details and to sign up for this service, go tonortherntrust.com/funds or contact your RelationshipManager.

T H R O U G H N O R T H E R N T R U S T A N D O T H E R

I N S T I T U T I O N S

If you have an account with Northern Trust, you may purchaseshares through Northern Trust. You also may purchase sharesthrough other financial institutions that have entered intoagreements with the Trust. To determine whether you maypurchase shares through your institution, contact yourinstitution directly or call 800-595-9111. Northern Trust andother financial institutions may impose charges against youraccount that will reduce the net return on an investment in aFund. These charges may include asset allocation fees, accountmaintenance fees, sweep fees, compensating balancerequirements or other charges based upon accounttransactions, assets or income.

S E L L I N G S H A R E S

THROUGH AN AUTHORIZED INTERMEDIARY. If you purchaseshares from an authorized intermediary, you may sell (redeem)shares by contacting your financial intermediary. See “AccountPolicies and Other Information—Financial Intermediaries”beginning on page 53 for additional information regardingsales (redemptions) of Fund shares through authorizedintermediaries.



REDEEMING AND EXCHANGING DIRECTLY FROM THE FUNDS. Ifyou purchased shares directly from the Funds or, if youpurchased your shares through an account at Northern Trustor another financial institution and you appear on Fundrecords as the registered holder, you may redeem all or part ofyour shares using one of the methods described below.

B Y M A I L

SEND A WRITTEN REQUEST TO:


THE REDEMPTION REQUEST MUST INCLUDE:

▪ The number of shares or the dollar amount to be redeemed;

▪ The Fund account number;

▪ The signatures of all account owners;

▪ A signature guarantee also is required if:

▪ The proceeds are to be sent elsewhere than the address ofrecord, or

▪ The redemption amount is greater than $100,000.

B Y W I R E

If you authorize wire redemptions on your New AccountApplication, you can redeem shares and have the proceeds sentby federal wire transfer to a previously designated bankaccount.

▪ You will be charged $15 for each wire redemption unless thedesignated bank account is maintained at Northern Trust oran affiliated bank.

▪ Call the Transfer Agent at 800-595-9111 for instructions.

▪ The minimum amount that may be redeemed by this methodis $250.

B Y S Y S T E M A T I C W I T H D R A W A L

If you own shares of a Fund with a minimum value of $10,000,you may elect to have a fixed sum redeemed at regular intervalsand distributed in cash or reinvested in one or more otherfunds of the Trust.

▪ Call 800-595-9111 for an application form and additionalinformation.

▪ The minimum amount is $250 per withdrawal.

B Y E X C H A N G E

The Trust offers you the ability to exchange shares of one fundin the Trust for shares of another fund in the Trust.

▪ When opening an account, complete the Exchange Privilegesection of the New Account Application or, if your account isalready opened, send a written request to:


▪ Shares being exchanged must have a value of at least $1,000($2,500 if a new account is being established by the exchange,$500 if the new account is an IRA).

▪ Call 800-595-9111 for more information.

B Y T E L E P H O N E

If you authorize the telephone privilege on your New AccountApplication, you may redeem shares by telephone.

▪ If your account is already opened, send a written request to:


▪ The request must be signed by each owner of the account andmust be accompanied by signature guarantees.

▪ Call 800-595-9111 to use the telephone privilege.

▪ During periods of unusual economic or market activity,telephone redemptions may be difficult to implement. In suchevent, shareholders should follow the procedures outlinedabove under “Selling Shares—By Mail” and outlined belowunder “Selling Shares—By Internet.”

B Y I N T E R N E T

You may initiate transactions between Northern Trust bankingand Northern Funds accounts by using Northern Trust PrivatePassport. For details and to sign up for this service, go tonortherntrust.com/funds or contact your RelationshipManager.

R E D E E M I N G A N D E X C H A N G I N G T H R O U G H

N O R T H E R N T R U S T A N D O T H E R I N S T I T U T I O N S

If you purchased your shares through an account at NorthernTrust or through another financial institution, you may redeemor exchange your shares according to the instructionspertaining to that account.



▪ Although the Trust imposes no charges when you redeemshares of a Fund (other than the 2.00% redemption feecharged for shares of each Fund held for less than 30 days),when shares are purchased through an account at NorthernTrust or through other financial institutions, a fee may becharged by those institutions for providing services inconnection with your account.

▪ Contact your account representative at Northern Trust or atanother financial institution for more information aboutredemptions or exchanges.



A C C O U N T P O L I C I E S A N D O T H E R I N F O R M A T I O N

CALCULATING SHARE PRICE. The Trust issues shares andredeems shares at NAV. The NAV for each Fund is calculatedby dividing the value of the Fund’s net assets by the number ofthe Fund’s outstanding shares. The NAV is calculated on eachBusiness Day (see “Business Day” on page 53) as of 3:00 p.m.Central time for each Fund. Shares of the Multi-Manager HighYield Opportunity Fund may be priced on days when the NewYork Stock Exchange (the “Exchange”) is closed if the SecuritiesIndustry and Financial Markets Association (“SIFMA”)recommends that the bond markets remain open for all or partof the day or on the days when the Federal Reserve Bank ofNew York is open. The NAV used in determining the price ofyour shares is the one calculated after your purchase, exchangeor redemption order is received in good order as described onpage 53.

Equity securities listed on a recognized U.S. securities exchangeor quoted on the NASDAQ National Market System are pricedat the regular trading session’s closing price on the exchange orsystem in which such securities are principally traded. Securitiesnot traded on the valuation date are priced at the most recentquoted bid price.

Investments of the Funds not traded on an exchange for whichmarket quotations are readily available will be valued using lastavailable bid prices or current market quotations provided bydealers or prices (including evaluated prices) supplied by theFunds’ approved independent third-party pricing services, eachin accordance with the valuation procedures approved by theBoard of Trustees. If market quotations are not readilyavailable, or if it is believed that such quotations do notaccurately reflect fair value, the value of the Funds’ investmentsmay be otherwise determined in good faith by NTI underprocedures established by the Board of Trustees. Circumstancesin which securities may be fair valued include periods whentrading in a security is suspended, the exchange or market onwhich a security trades closes early, the trading volume in asecurity is limited, corporate actions and announcements takeplace, or regulatory news is released such as governmentalapprovals. Additionally, the Trust, in its discretion, may makeadjustments to the prices of securities held by a Fund if anevent occurs after the publication of market values normallyused by a Fund but before the time as of which the Fundcalculates its NAV, depending on the nature and significance ofthe event, consistent with applicable regulatory guidance andthe Trust’s fair value procedures. This may occur particularlywith respect to certain foreign securities held by a Fund, inwhich case the Trust may use adjustment factors obtained froman independent evaluation service that are intended to reflectmore accurately the value of those securities as of the time theFund’s NAV is calculated. Other events that can trigger fairvaluing of foreign securities include, for example, significantfluctuations in general market indicators, governmental

actions, or natural disasters. The use of fair valuation involvesthe risk that the values used by the Funds to price theirinvestments may be higher or lower than the values used byother unaffiliated investment companies and investors to pricethe same investments. Short-term obligations, which are debtinstruments with a maturity of 60 days or less, held by a Fundare valued at their amortized cost, which, according to theInvestment Adviser, approximates fair value.

A Fund may hold foreign securities that trade on weekends orother days when the Fund does not price its shares. Therefore,the value of such securities may change on days whenshareholders will not be able to purchase or redeem shares.

TIMING OF PURCHASE REQUESTS. Purchase requests received ingood order and accepted by the Transfer Agent or otherauthorized intermediary by 3:00 p.m. Central time on anyBusiness Day will be executed the day they are received byeither the Transfer Agent or other authorized intermediary, atthat day’s closing share price for the applicable Fund(s),provided that one of the following occurs:

▪ The Transfer Agent receives payment by 3:00 p.m. Centraltime on the same Business Day; or

▪ The requests are placed by a financial or authorizedintermediary that has entered into a servicing agreement withthe Trust or its agent and payment in federal or otherimmediately available funds is received by the Transfer Agentby the close of the same Business Day or on the next BusinessDay, depending on the terms of the Trust’s or it’s agent’sagreement with the intermediary.

Purchase requests received in good order by the Transfer Agentor other authorized intermediary on a non-Business Day orafter 3:00 p.m. Central time on a Business Day will be executedon the next Business Day, at that day’s closing share price forthe applicable Fund(s), provided that payment is made as notedabove.

MISCELLANEOUS PURCHASE INFORMATION.

▪ You will be responsible for all losses and expenses of a Fund,and purchase orders may be cancelled, in the event of anyfailure to make payment according to the procedures outlinedin this Prospectus. In addition, a $20 charge will be imposed ifa check does not clear.

▪ Exchanges into the Funds from another fund in the Trust maybe subject to any redemption fee imposed by the other fund.

▪ You may initiate transactions between Northern Trustbanking and Northern Funds accounts by using NorthernTrust Private Passport. For additional details, please go tonortherntrust.com/funds or contact your RelationshipManager.



▪ The Trust and NFD each reserves the right, in its solediscretion, to suspend the offering of shares of a Fund or toreject any purchase order, in whole or in part, when, in thejudgment of management, such suspension or rejection is inthe best interests of the Fund. The Trust also reserves the rightto change or discontinue any of its purchase procedures.

▪ In certain circumstances, the Trust may advance the time bywhich purchase orders must be received. See “Early Closings”on page 53.

▪ If the Transfer Agent cannot locate an investor for a period oftime specified by appropriate state law, the investor’s accountmay be deemed legally abandoned and then escheated(transferred) to such state’s unclaimed property administratorin accordance with statutory requirements.

TIMING OF REDEMPTION AND EXCHANGE REQUESTS.Redemption and exchange requests received in good order bythe Transfer Agent or other authorized intermediary on aBusiness Day by 3:00 p.m. Central time will be executed on thesame day at that day’s closing share price for the applicableFund(s) (less any applicable redemption fee).

Redemption and exchange requests received in good order bythe Transfer Agent or other authorized intermediary on anon-Business Day or after 3:00 p.m. Central time on a BusinessDay will be executed the next Business Day, at that day’s closingshare price for the applicable Fund(s) (less any applicableredemption fee).

PAYMENT OF REDEMPTION PROCEEDS. If your account is helddirectly with a Fund, it is expected that the Fund will typicallypay out redemption proceeds to shareholders by the nextBusiness Day following receipt of a redemption request.

If your account is held through an intermediary, the length oftime to pay redemption proceeds typically depends, in part, onthe terms of the agreement in place between the intermediaryand the Fund. For redemption proceeds that are paid eitherdirectly to you from a Fund or to your intermediary fortransmittal to you, it is expected that payments will typically bemade by wire, by ACH or by issuing a check by the nextBusiness Day following receipt of a redemption request in goodorder from the intermediary by a Fund. Redemption requeststhat are processed through investment professionals that utilizethe National Securities Clearing Corporation will generallysettle one to three Business Days following receipt of aredemption request in good order.

However, if you have recently purchased shares with a check orthrough an electronic transaction, payment may be delayed asdiscussed below under “Miscellaneous RedemptionInformation.”

It is expected that payment of redemption proceeds willnormally be made from uninvested cash or short-terminvestments, proceeds from the sale of portfolio securities, orborrowing through the Trust’s committed, unsecured creditfacility (see “Credit Facility and Borrowing,” on page 62). It ispossible that stressed market conditions or large shareholderredemptions may result in the need for utilization of a Fund’sability to redeem in-kind in order to meet shareholderredemption requests. A Fund reserves the right to pay all orpart of your redemption proceeds in readily marketablesecurities instead of cash (redemption in-kind). Redemptionin-kind proceeds will typically be made by delivering theselected securities to the redeeming shareholder within sevendays after the receipt of the redemption request in good orderby a Fund.

REDEMPTION FEES. Each Fund charges a 2.00% redemption feeon the redemption of shares (including by exchange) held for30 days or less. For the purpose of applying the fee, the Fundsuse a first-in, first-out (“FIFO”) method so that shares heldlongest are treated as being redeemed first and shares heldshortest are treated as being redeemed last. The redemption feeis paid to the Fund from which the redemption is made, and isintended to offset the trading, market impact and other costsassociated with short-term money movements in and out of theFund. The redemption fee may be collected by deduction fromthe redemption proceeds or, if assessed after the redemptiontransaction, through a separate billing.

The Funds are authorized to waive the redemption fee for thefollowing transactions:

▪ Redemptions from omnibus accounts, fee-based programsand employer-sponsored defined contribution plansmaintained by financial intermediaries that inform the Fundthat they are unable to impose a redemption fee on theirunderlying customer accounts;

▪ Redemptions where the shares were purchased throughfinancial intermediaries that the Investment Adviserdetermines to have appropriate anti-short-term tradingpolicies in place or as to which the Investment Adviser hasreceived assurances that look-through redemption feeprocedures or effective anti-short-term trading policies andprocedures are in place;

▪ Redemptions effected pursuant to asset allocation programs,wrap fee programs and other investment programs offered byfinancial institutions where investment decisions are made ona discretionary basis by investment professionals;

▪ Redemptions pursuant to systematic withdrawal plans andautomatic exchange plans;



▪ Redemptions of shares acquired by reinvestment of dividends,distributions or other payments;

▪ Redemptions due to the death or the post-purchase disabilityof the beneficial owner of the account;

▪ Redemptions to satisfy minimum required distributions fromretirement accounts;

▪ Redemptions representing the return of excess contributionsin retirement accounts;

▪ Redemptions initiated by the Fund; and

▪ Redemptions following investments of contributions in theFund by participants in defined contribution plans.

In addition to the circumstances noted above, each Fundreserves the right to waive the redemption fee in its discretionwhere it believes such waiver is consistent with the best interestsof the Fund, to the extent permitted by law. In addition, eachFund reserves the right to add, modify or eliminate theredemption fee or waivers at any time and will give 60 days’prior written notice of any material changes, unless otherwiseprovided by law.

Currently, the Funds are limited in their ability to assess orcollect the redemption fee on all shares redeemed by financialintermediaries on behalf of their customers. For example,where a financial intermediary is not able to determine if theredemption fee applies and/or is not able to assess or collect thefee, or does not collect the fee at the time of a redemption, aFund will not receive the redemption fee. If Fund shares areredeemed by a financial intermediary at the direction of itscustomers, the Funds may not know whether a redemption feeis applicable or the identity of the customer who should pay theredemption fee. Due to operational requirements, a financialintermediary’s method for tracking and calculating theredemption fee may differ in some respects from that used bythe Funds. Northern Trust will ask financial intermediaries toassess redemption fees on shareholder accounts in appropriatecases and remit these fees to the applicable Fund. However, forthe reasons set forth above, there can be no assurance that thefinancial intermediaries will properly assess redemption fees.Customers purchasing shares from financial intermediariesshould contact these intermediaries or refer to their accountagreements or plan documents for more information on howthe redemption fee is applied to their shares.

MISCELLANEOUS REDEMPTION INFORMATION. All redemptionproceeds will be sent by check unless the Transfer Agent isdirected otherwise. Redemption proceeds also may be wired.Redemptions are subject to the following restrictions:

▪ The Trust may require any information from the shareholderreasonably necessary to ensure that a redemption request hasbeen duly authorized.

▪ Redemption requests made to the Transfer Agent by mailmust be signed by a person authorized by acceptabledocumentation on file with the Transfer Agent.

▪ The Trust reserves the right, on 30 days’ written notice, toredeem the shares held in any account if, at the time ofredemption, the NAV of the remaining shares in the accountfalls below $1,000. Involuntary redemptions will not be madeif the value of shares in an account falls below the minimumsolely because of a decline in a Fund’s NAV.

▪ If you are redeeming recently purchased shares by check orelectronic transaction, your redemption request may not bepaid until your check or electronic transaction has cleared.This may delay your payment for up to 10 days.

▪ Subject to applicable law, the Trust and the Transfer Agentreserve the right to redeem shares held by any shareholderwho provides incorrect or incomplete account information orwhen such involuntary redemptions are necessary to avoidadverse consequences to the Trust and its shareholders or theTransfer Agent.

▪ Subject to applicable law, the Trust, Northern Trust and theiragents reserve the right to involuntarily redeem or suspend anaccount at the Fund’s then current NAV, in cases ofdisruptive conduct, suspected fraudulent or illegal activity,inability to verify the identity of an investor, or othercircumstances determined to be in the best interest of theTrust and its shareholders.

▪ The Trust, Northern Trust and their agents reserve the right,without notice, to freeze any account and/or suspend accountservices when: (i) notice has been received of a disputeregarding the assets in an account, or a legal claim against anaccount; (ii) upon initial notification to Northern Trust of ashareholder’s or authorized agent’s death until NorthernTrust receives required documentation in correct form; or(iii) if there is a reason to believe a fraudulent transaction mayoccur or has occurred.

▪ You may initiate transactions between Northern Trust bankingand the Trust’s accounts by using Northern Trust PrivatePassport. For additional details, please go to northerntrust.com/funds or contact your Relationship Manager.

▪ The Trust reserves the right to change or discontinue any ofits redemption procedures.

▪ The Trust reserves the right to defer crediting, sending orwiring redemption proceeds for up to 7 days (or such longerperiod permitted by the SEC) after receiving the redemptionorder if, in its judgment, an earlier payment could adverselyaffect a Fund. The processing of redemptions may besuspended, and the delivery of redemption proceeds may bedelayed beyond seven days, depending on the circumstances,



for any period: (i) during which the Exchange is closed (otherthan on holidays or weekends), or during which trading onthe Exchange is restricted; (ii) when an emergency exists thatmakes the disposal of securities owned by a Fund or thedetermination of the fair value of a Fund’s net assets notreasonably practicable; or (iii) as permitted by order of theSEC for the protection of Fund shareholders.

▪ The Trust does not permit redemption proceeds to be sent byoutgoing International ACH Transaction (“IAT”). An IAT is apayment transaction involving a financial institution’s officelocated outside U.S. territorial jurisdiction.

▪ In certain circumstances, the Trust may advance the time bywhich redemption and exchange orders must be received. See“Early Closings” on page 53.

EXCHANGE PRIVILEGES. You may exchange shares of one fundin the Trust for shares of another fund in the Trust only if theregistration of both accounts is identical. Both accounts musthave the same owner’s name and title, if applicable. Anexchange is a redemption of shares of one fund and thepurchase of shares of another fund in the Trust. If the sharesredeemed are held in a taxable account, an exchange isconsidered a taxable event and may result in a gain or loss. TheTrust reserves the right to waive or modify minimuminvestment requirements in connection with exchanges.

The Trust reserves the right to change or discontinue theexchange privilege at any time upon 60 days’ written notice toshareholders and to reject any exchange request. Exchanges areonly available in states where an exchange can legally be made.Before making an exchange, you should read the Prospectus forthe shares you are acquiring.

POLICIES AND PROCEDURES ON EXCESSIVE TRADING

PRACTICES. In accordance with the policy adopted by the Boardof Trustees, the Trust discourages market timing and otherexcessive trading practices. Purchases and exchanges should bemade with a view to longer-term investment purposes only.Excessive, short-term (market timing) trading practices maydisrupt Fund management strategies, increase brokerage andadministrative costs, harm Fund performance and result indilution in the value of Fund shares held by long-termshareholders. The Multi-Manager Emerging Markets DebtOpportunity Fund, Active M Emerging Markets Equity Fund,Multi-Manager Global Listed Infrastructure Fund and Active MInternational Equity Fund, which invest primarily in foreignsecurities, and the Multi-Manager Global Real Estate Fund,which invests in foreign securities to a lesser extent, may besusceptible to the risk of excessive, short-term trading due tothe potential for time zone arbitrage. These risks may beenhanced with respect to the Multi-Manager Emerging MarketsDebt Opportunity Fund, Active M Emerging Markets Equity

Fund, Multi-Manager Global Listed Infrastructure Fund andActive M International Equity Fund due to their investments inissuers located in emerging markets, and with respect to theMulti-Manager Emerging Markets Debt Opportunity Fund,Active M Emerging Markets Equity Fund, and Multi-ManagerGlobal Listed Infrastructure Fund, due to its investments inissuers located in frontier markets.

Securities of emerging and frontier market issuers tend to beless liquid than issuers located in developed markets, and Fundsthat invest principally in issuers located in emerging and/orfrontier markets may therefore be subject to an increased riskof arbitrage. The Trust and Northern Trust reserve the right toreject or restrict purchase or exchange requests from anyinvestor. The Trust and Northern Trust will not be liable forany loss resulting from rejected purchase or exchange orders.To minimize harm to the Trust and its shareholders (orNorthern Trust), the Trust (or Northern Trust) will exercisethis right if, in the Trust’s (or Northern Trust’s) judgment, aninvestor has a history of excessive trading or if an investor’strading, in the judgment of the Trust (or Northern Trust), hasbeen or may be disruptive to a Fund. In making this judgment,trades executed in multiple accounts under common ownershipor control may be considered together to the extent they can beidentified. No waivers of the provisions of the policy establishedto detect and deter market timing and other excessive tradingactivity are permitted that would harm the Trust or itsshareholders or would subordinate the interests of the Trust orits shareholders to those of Northern Trust or any affiliatedperson or associated person of Northern Trust.

To deter excessive shareholder trading, a shareholder isrestricted to no more than two “round trips” in a Fund duringa calendar quarter. A “round trip” is a redemption or exchangeout of a Fund followed by a purchase or exchange into the sameFund. The Trust is authorized to permit more than two “roundtrips” in a Fund during a calendar quarter if the Trustdetermines in its reasonable judgment that the Trust’s excessivetrading policies would not be violated. Examples of suchtransactions include, but are not limited to, trades involving:

▪ asset allocation programs, wrap fee programs and otherinvestment programs offered by financial institutions whereinvestment decisions are made on a discretionary basis byinvestment professionals;

▪ systematic withdrawal plans and automatic exchange plans;

▪ reinvestment of dividends, distributions or other payments;

▪ a death or post-purchase disability of the beneficial owner ofthe account;

▪ minimum required distributions from retirement accounts;

▪ the return of excess contributions in retirement accounts; and

▪ redemptions initiated by a Fund.



In addition, the Multi-Manager Emerging Markets DebtOpportunity Fund, Active M Emerging Markets Equity Fund,Multi-Manager Global Listed Infrastructure Fund, Multi-Manager Global Real Estate Fund, Multi-Manager High YieldOpportunity Fund and Active M International Equity Fundeach imposes a redemption fee on redemptions made within 30calendar days of purchase subject to certain exceptions. Forfurther information, please see “Redemption Fees” on page 49.As described below and in “Redemption Fees” it should benoted that the Trust’s ability to monitor and limit the tradingactivity of shareholders investing in a Fund through anomnibus account of a financial intermediary may besignificantly limited or absent where the intermediarymaintains the underlying shareholder accounts.

Pursuant to the policy adopted by the Board of Trustees, theTrust has developed criteria that it uses to identify tradingactivity that may be excessive. The Trust reviews on a regularand periodic basis available information relating to the tradingactivity in the Funds in order to assess the likelihood that aFund may be the target of excessive trading. As part of itsexcessive trading surveillance process, the Trust, on a periodicbasis, examines transactions that exceed certain monetarythresholds or numerical limits within a period of time. If, in itsjudgment, the Trust detects excessive, short-term trading,whether or not the shareholder has made two round trips in acalendar quarter, the Trust may reject or restrict a purchase orexchange request and may further seek to close an investor’saccount with a Fund.

The Trust may modify its surveillance procedures and criteriafrom time to time without prior notice regarding the detectionof excessive trading or to address specific circumstances. TheTrust will apply the criteria in a manner that, in the Trust’sjudgment, will be uniform.

Fund shares may be held through omnibus arrangementsmaintained by intermediaries such as broker-dealers,investment advisers, transfer agents, administrators andinsurance companies. In addition, Fund shares may be held inomnibus 401(k) plans, retirement plans and other groupaccounts. Omnibus accounts include multiple investors, andsuch account typically provide the Funds with a net purchase orredemption request on any given day where the purchases andredemptions of Fund shares by the investors are netted againstone another. The identities of individual investors whosepurchase and redemption orders are aggregated are not knownby the Funds. While Northern Trust may monitor shareturnover at the omnibus account level, a Fund’s ability tomonitor and detect market timing by shareholders or apply anyapplicable redemption fee in these omnibus accounts is limited.The netting effect makes it more difficult to identify, locate andeliminate market timing activities. In addition, those investors

who engage in market timing and other excessive tradingactivities may employ a variety of techniques to avoiddetection. There can be no assurance that the Funds andNorthern Trust will be able to identify all those who tradeexcessively or employ a market timing strategy, and curtail theirtrading in every instance.

If necessary, the Trust may prohibit additional purchases ofFund shares by a financial intermediary or by certain of theintermediary’s customers. Financial intermediaries may alsomonitor their customers’ trading activities in the Trust. Certainfinancial intermediaries may monitor their customers forexcessive trading according to their own excessive tradingpolicies. The Trust may rely on these financial intermediaries’excessive trading policies in lieu of applying the Trust’s policies.

The financial intermediaries’ excessive trading policies maydiffer from the Trust’s policies and there is no assurance thatthe procedures used by financial intermediaries will be able tocurtail excessive trading activity in the Trust.

IN-KIND PURCHASES AND REDEMPTIONS. The Trust reservesthe right to accept payment for shares in the form of securitiesthat are permissible investments for a Fund. The Trust alsoreserves the right to pay redemptions by a distribution“in-kind” of securities (instead of cash) from a Fund. See theSAI for further information about the terms of these purchasesand redemptions.

TELEPHONE TRANSACTIONS. All calls may be recorded ormonitored. The Transfer Agent has adopted procedures in aneffort to establish reasonable safeguards against fraudulenttelephone transactions. If reasonable measures are taken toverify that telephone instructions are genuine, the Trust and itsservice providers will not be responsible for any loss resultingfrom fraudulent or unauthorized instructions received over thetelephone. In these circumstances, shareholders will bear therisk of loss. During periods of unusual market activity, you mayhave trouble placing a request by telephone. In this event,consider sending your request in writing or follow theprocedures found on pages 45 or 46 for initiating transactionsby the Internet.

The proceeds of redemption orders received by telephone willbe sent by check, wire or transfer according to properinstructions. All checks will be made payable to the shareholderof record and mailed only to the shareholder’s address ofrecord. The Trust reserves the right to refuse a telephoneredemption, subject to applicable law.

MAKING CHANGES TO YOUR ACCOUNT INFORMATION. Youmay make changes to wiring instructions only in writing. Youmay make changes to an address of record or certain otheraccount information in writing or by telephone. Writteninstructions must be accompanied by acceptable evidence of



authority (if applicable). A signature guarantee also may berequired from an institution participating in the Stock TransferAgency Medallion Program (“STAMP”). Additionalrequirements may be imposed. In accordance with SECregulations, the Trust and Transfer Agent may charge ashareholder reasonable costs in locating a shareholder’s currentaddress.

SIGNATURE GUARANTEES. If a signature guarantee is required,it must be from an institution participating in STAMP, or otheracceptable evidence of authority (if applicable) must beprovided. Additional requirements may be imposed by theTrust. In addition to the situations described in this Prospectus,the Trust may require signature guarantees in othercircumstances based on the amount of a redemption request orother factors.

BUSINESS DAY. A “Business Day” is each Monday throughFriday when the Exchange is open for business. For any givencalendar year, the Funds will be closed on the followingholidays or as observed: New Year’s Day, Martin Luther King,Jr. Day, Presidents’ Day, Good Friday, Memorial Day,Independence Day, Labor Day, Thanksgiving Day andChristmas Day.

GOOD ORDER. A purchase, redemption or exchange request isconsidered to be “in good order” when all necessaryinformation is provided and all required documents areproperly completed, signed and delivered, including acceptableevidence of authority (if applicable). Requests must include thefollowing:

▪ The account number (if issued) and Fund name;

▪ The amount of the transaction, in dollar amount or numberof shares;

▪ For redemptions and exchanges (other than online, telephoneor wire redemptions), the signature of all account ownersexactly as they are registered on the account;

▪ Required signature guarantees, if applicable;

▪ Other supporting legal documents and certified resolutionsthat might be required in the case of estates, corporations,trusts and other entities or forms of ownership. Call800-595-9111 for more information about documentationthat may be required of these entities.

Additionally, a purchase order initiating the opening of anaccount will not be considered to be “in good order” unless theinvestor has provided all information required by the Trust’s“Customer Identification Program” described below.

CUSTOMER IDENTIFICATION PROGRAM. Federal law requiresthe Trust to obtain, verify and record identifying information,which may include the name, residential or business street

address, date of birth (for an individual), social security ortaxpayer identification number or other identifyinginformation for each investor who opens or reopens an accountwith the Trust. Applications without this information, orwithout an indication that a social security or taxpayeridentification number has been applied for, may not beaccepted. After acceptance, to the extent permitted byapplicable law or the Trust’s customer identification program,the Trust reserves the right to: (a) place limits on accounttransactions until an investor’s identity is verified; (b) refuse aninvestment in the Trust; or (c) involuntarily redeem aninvestor’s shares and close an account in the event that aninvestor’s identity is not verified. The Trust and its agents willnot be responsible for any loss in an investor’s accountresulting from an investor’s delay in providing all requiredidentifying information or from closing an account andredeeming an investor’s shares when an investor’s identity isnot verified.

EARLY CLOSINGS. The Funds reserve the right to advance thetime for accepting purchase, redemption or exchange orders forsame Business Day credit when the Exchange closes early,trading on the Exchange is restricted, an emergency arises or asotherwise permitted by the SEC. The Multi-Manager HighYield Opportunity Fund reserves the right to advance the timefor accepting purchase, redemption or exchange orders forsame Business Day credit when the bond markets close early. Inaddition, on any Business Day when SIFMA recommends thatthe bond markets close early, the Multi-Manager High YieldOpportunity Fund reserves the right to close at or prior to theSIFMA recommended closing time. If the Fund does so, it willcease granting same Business Day credit for purchase andredemption orders received at the Fund’s closing time andcredit will be given on the next Business Day. In addition, theBoard of Trustees of the Trust also may, for any Business Day,decide to change the time as of which a Fund’s NAV iscalculated in response to new developments such as alteredtrading hours, or as otherwise permitted by the SEC.

EMERGENCY OR UNUSUAL EVENTS. In the event the Exchangedoes not open for business because of an emergency or unusualevent, the Trust may, but is not required to, open one or moreFunds for purchase, redemption and exchange transactions ifthe Federal Reserve wire payment system is open. To learnwhether a Fund is open for business during an emergencysituation or unusual event, please call 800-595-9111 or visitnortherntrust.com/funds.

FINANCIAL INTERMEDIARIES. The Trust may authorize certaininstitutions acting as financial intermediaries (including banks,trust companies, brokers and investment advisers) to acceptpurchase, redemption and exchange orders from theircustomers on behalf of the Funds. These authorized



intermediaries also may designate other intermediaries toaccept such orders, if approved by the Trust. A Fund will bedeemed to have received an order when the order is accepted bythe authorized intermediary, and the order will be priced at theFund’s per share NAV next determined, provided that theauthorized intermediary forwards the order (and payment forany purchase order) to the Transfer Agent on behalf of theTrust within agreed-upon time periods. If the order (orpayment for any purchase order) is not received by the TransferAgent within such time periods, the authorized intermediarymay be liable for fees and losses and the transaction may becancelled.

The Trust may enter into agreements with certain financialintermediaries, including affiliates of Northern Trust thatperform support services for their customers who own Fundshares (“Service Organizations”). These support services mayinclude:

▪ assisting investors in processing purchase, exchange andredemption requests;

▪ processing dividend and distribution payments from theFunds;

▪ providing information to customers showing their positionsin the Funds; and

▪ providing subaccounting with respect to Fund sharesbeneficially owned by customers or the information necessaryfor subaccounting.

For their services, Service Organizations may receive fees froma Fund at annual rates of up to 0.15% of the average daily NAVof the shares covered by their agreements. Because these fees arepaid out of the Funds’ assets on an on-going basis, they willincrease the cost of your investment in the Funds.

The Funds’ arrangements with Service Organizations under theagreements are governed by a Service Plan, which has beenadopted by the Board of Trustees.

Northern Trust also may provide compensation to certaindealers and Service Organizations, for marketing anddistribution in connection with the Trust. Northern Trust mayalso sponsor informational meetings, seminars and othersimilar programs designed to market the Trust. The amount ofsuch compensation and payments may be made on a one-timeand/or periodic basis, and may represent all or a portion of theannual fees earned by the Investment Adviser (afteradjustments). The additional compensation and payments willbe paid by Northern Trust or its affiliates and will not representan additional expense to the Trust or its shareholders. Suchpayments may provide incentives for financial intermediaries tomake shares of the Funds available to their customers, and mayallow the Funds greater access to such parties and theircustomers than would be the case if no payments were paid.

Investors purchasing shares of a Fund through a financialintermediary should read their account agreements with thefinancial intermediary carefully. A financial intermediary’srequirements may differ from those listed in this Prospectus. Afinancial intermediary also may impose account charges, suchas asset allocation fees, account maintenance fees and othercharges that will reduce the net return on an investment in aFund. If an investor has agreed with a particular financialintermediary to maintain a minimum balance and the balancefalls below this minimum, the investor may be required toredeem all or a portion of the investor’s investment in a Fund.

Conflict of interest restrictions may apply to the receipt ofcompensation by a Service Organization or other financialintermediary in connection with the investment of fiduciaryfunds in Fund shares. Institutions, including banks regulated bythe Comptroller of the Currency, Federal Reserve Board andstate banking commissions, and investment advisers and othermoney managers subject to the jurisdiction of the SEC, theDepartment of Labor or state securities commissions, are urgedto consult their legal counsel.

State securities laws regarding the registration of dealers maydiffer from federal law. As a result, Service Organizations andother financial intermediaries investing in the Funds on behalfof their customers may be required to register as dealers.

PORTFOLIO HOLDINGS. The Funds, or their duly authorizedservice providers, may publicly disclose holdings of all Funds inaccordance with regulatory requirements, such as periodicportfolio disclosure in filings with the SEC.

A complete schedule of each Fund’s holdings, current as ofcalendar quarter-end, will be available on the Trust’s website atnortherntrust.com/funds no earlier than ten (10) calendar daysafter the end of the period. The Funds will also publish theirtop ten holdings on their website, current as of month-end, noearlier than ten (10) calendar days after the end of the month.

This information will remain available on the website at leastuntil the Funds file with the SEC their semiannual/annualshareholder report or quarterly portfolio holdings report thatincludes such period. The Funds may terminate or modify thispolicy at any time without further notice to shareholders. AFund may publish on the Trust’s website a complete scheduleof its portfolio holdings and certain other informationregarding portfolio holdings more frequently in accordancewith the Trust’s policy.

A further description of the Trust’s Policy on Disclosure ofPortfolio Holdings is available in the SAI.

SHAREHOLDER COMMUNICATIONS. Shareholders of recordwill be provided each year with a semiannual report showingportfolio investments and other information as of



September 30 and with an annual report containing auditedfinancial statements as of March 31. If we have receivedappropriate written consent, we send a single copy of allmaterials, including prospectuses, financial reports, proxystatements or information statements to all shareholders whoshare the same mailing address, even if more than one personin a household holds shares of a Fund.

If you do not want your mailings combined with those of othermembers of your household, you may opt-out at any time bycontacting the Northern Funds Center by telephone at800-595-9111 or by mail at Northern Funds, P.O. Box 75986,Chicago, Illinois 60675-5986. You also may send an e-mail [email protected]. The Funds will begin sendingindividual copies to you within 30 days after receipt of youropt-out notice.

The Trust may reproduce this Prospectus in electronic formatthat may be available on the Internet. If you have received thisProspectus in electronic format you, or your representative,may contact the Transfer Agent for a free paper copy of thisProspectus by writing to the Northern Funds Center at P.O.Box 75986, Chicago, Illinois 60675-5986, calling 800-595-9111or by sending an e-mail to: [email protected].



D I V I D E N D S A N D D I S T R I B U T I O N S

DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS OF EACH FUND ARE AUTOMATICALLY

REINVESTED IN ADDITIONAL SHARES OF THE SAME FUND WITHOUT ANY SALES CHARGE.

You may, however, elect to have dividends or capital gaindistributions (or both) paid in cash or reinvested in shares ofanother fund in the Trust at its NAV per share. If you wouldlike to receive dividends or distributions in cash or have themreinvested in another fund in the Trust, you must notify theTransfer Agent in writing. This election will become effectivefor distributions paid two days after its receipt by the TransferAgent. Dividends and distributions only may be reinvested in afund in the Trust in which you maintain an account.

Dividend and capital gain distributions that are returned to aFund as undeliverable will be reinvested into your accountupon return receipt at the Fund’s then current NAV. Also,future distributions will be reinvested until the Fund receivesvalid delivery instructions.

The following table summarizes the general distributionpolicies for each of the Funds. A Fund may, in some years, payadditional dividends or make additional distributions to theextent necessary for the Fund to avoid incurring tax liabilitiesor for other reasons.

FundDividends, if any,

Declared and PaidCapital Gains, if any,

Declared and Paid

ACTIVE M EMERGING MARKETS EQUITY Annually Annually

ACTIVE M INTERNATIONAL EQUITY Annually Annually

MULTI-MANAGER EMERGING MARKETS DEBT OPPORTUNITY Quarterly Annually

MULTI-MANAGER GLOBAL LISTED INFRASTRUCTURE Quarterly Annually

MULTI-MANAGER GLOBAL REAL ESTATE Quarterly Annually

MULTI-MANAGER HIGH YIELD OPPORTUNITY Monthly Annually



T A X C O N S I D E R A T I O N S

The following is a summary of certain tax considerations thatmay be relevant to an investor in a Fund. The discussions of thefederal income tax consequences in this Prospectus and the SAIare based on the Internal Revenue Code of 1986, as amended(the “Code”) and the regulations issued under it, and courtdecisions and administrative interpretations, as in effect on thedate of this Prospectus. Future legislative or administrativechanges or court decisions may significantly alter thestatements included herein, and any such changes or decisionsmay be retroactive. Except where otherwise indicated, thediscussion relates to shareholders who are individual U.S.citizens or residents and is based on current tax law. Youshould consult your tax professional for further informationregarding federal, state, local and/or foreign tax consequencesrelevant to your specific situation.

DISTRIBUTIONS. Each Fund intends to qualify as a regulatedinvestment company for federal tax purposes, and to distributeto shareholders substantially all of its net investment incomeand net capital gain each year. Except as otherwise noted below,you will generally be subject to federal income tax on a Fund’sdistributions to you, regardless of whether they are paid in cashor reinvested in Fund shares. For federal income tax purposes,Fund distributions attributable to short-term capital gains andnet investment income generally are taxable to you as ordinaryincome. Distributions attributable to net capital gain (theexcess of net long-term capital gains over net short-term capitallosses) of a Fund generally are taxable to you as long-termcapital gains. This is true no matter how long you own yourFund shares. The maximum long-term capital gain rateapplicable to individuals, estates and trusts is currently 20%.Gains from REITs and MLPs that are unrecapturedSection 1250 gains are subject to a maximum rate of 25%. U.S.individuals with “modified adjusted gross income” exceeding$200,000 ($250,000 if married and filing jointly) and trusts andestates with income above certain thresholds are subject to theMedicare contribution tax on their “net investment income,”which includes non-exempt interest, dividends and capitalgains at a rate of 3.8%.

Distributions of “qualifying dividends” will also generally betaxable to you at long-term capital gain rates, as long as certainrequirements are met. In general, if 95% or more of the grossincome of a Fund (other than net capital gain) consists ofdividends received from domestic corporations or “qualified”foreign corporations (“qualifying dividends”) and when certainother requirements are met, then all distributions paid by theFund to individual shareholders will be treated as qualifyingdividends. But if less than 95% of the gross income of a Fund(other than net capital gain) consists of qualifying dividends,then distributions paid by the Fund to individual shareholderswill be qualifying dividends only to the extent they arederived from qualifying dividends earned by the Fund. For the

long-term capital gain rates to apply, you must have ownedyour Fund shares for at least 61 days during the 121-day periodbeginning on the date that is 60 days before the Fund’sex-dividend date (and the Fund will need to have met a similarholding period requirement with respect to the shares of thecorporation paying the qualifying dividend). The amount of aFund’s distributions that qualify for this favorable treatmentmay be reduced as a result of the Fund’s securities lendingactivities, if any, by a high portfolio turnover rate or byinvestments in debt securities or “non-qualified” foreigncorporations.

To the extent that a Fund invests a portion of its assets inentities that qualify as REITs for U.S. federal income taxpurposes or foreign corporations that are not “qualified”foreign corporations, distributions attributable to the dividendsfrom those entities will generally not constitute “qualifyingdividends” for purposes of the long-term capital gain rate.Accordingly, investors in the Fund should anticipate that all ora portion of the dividends they receive may be taxable at thehigher rates generally applicable to ordinary income.

Certain Funds may make distributions to you of “section 199Adividends” with respect to qualified dividends that it receiveswith respect to its investments in REITs. A section 199Adividend is any dividend or part of such dividend that a Fundpays to its shareholders and reports as a section 199A dividendin written statements furnished to its shareholders.Distributions paid by a Fund that are eligible to be treated assection 199A dividends for a taxable year may not exceed the“qualified REIT dividends” received by the Fund from REITsreduced by the Fund’s allocable expenses. Section 199Adividends may be taxed to individuals and other non-corporateshareholders at a reduced effective federal income tax rate,provided the shareholder receiving the dividends has satisfied aholding period requirement for the Fund’s shares and satisfiedcertain other conditions. For the lower rates to apply, you musthave owned your Fund shares for at least 46 days during the91-day period beginning on the date that is 45 days before theFund’s ex-dividend date, but only to the extent that you are notunder an obligation (under a short-sale or otherwise) to makerelated payments with respect to positions in substantiallysimilar or related property.

The Multi-Manager Emerging Markets Debt Opportunity Fundand Multi-Manager High Yield Opportunity Fund willgenerally invest in debt instruments and not in shares of stockon which dividend income will be received. As a result, theseFunds do not expect to pay dividends that are eligible for thereduced individual income tax rate currently applicable toqualified dividend income or treated as section 199A dividends.

A portion of distributions paid by a Fund to shareholders whoare corporations may also qualify for the dividends-received



deduction for corporations, subject to certain holding periodrequirements and debt financing limitations. The amount ofthe dividends qualifying for this deduction may, however, bereduced as a result of the Fund’s securities lending activities, bya high portfolio turnover rate or by investments in debtsecurities or foreign corporations. It is expected thatdistributions paid by the Multi-Manager Emerging MarketsDebt Opportunity Fund, Active M Emerging Markets EquityFund, Multi-Manager Global Listed Infrastructure Fund,Multi-Manager Global Real Estate Fund, Multi-Manager HighYield Opportunity Fund and Active M International EquityFund will generally not qualify for this deduction.

To the extent that a Fund invests a portion of its assets inMLPs, Fund distributions attributable to distributions fromthose entities will generally not constitute “qualifyingdividends” for purposes of the long-term capital gain rate.Additionally, a Fund may be allocated items of tax preferenceor adjustment for alternative minimum tax purposes fromMLPs and will be required to allocate those items toshareholders.

Distributions from each Fund will generally be taxable to youin the year in which they are paid, with one exception.Dividends and distributions declared by a Fund in October,November or December and paid in January of the followingyear are taxed as though they were paid on December 31.

Each year, the Fund will send you an annual statement(Form 1099) of your account activity to assist you incompleting your federal, state and local tax returns. Prior toissuing your statement, the Fund makes every effort to obtaincorrect information regarding Fund income to reduce thenumber of corrected forms mailed to shareholders. However,when necessary, the Fund will send you a corrected Form 1099to reflect changes in information regarding fund income.

The REIT or MLP investments of a Fund often do not providecomplete tax information to the Fund until after the calendaryear-end. Consequently, because of the delay, it may benecessary for the Fund to request permission to extend thedeadline for issuance of Forms 1099-DIV beyond January 31.Also, under current provisions of the Code, distributionsattributable to operating income of REITs in which a Fundinvests are not eligible for favorable tax treatment as long-termcapital gains, but as noted above, a Fund may classify suchdistributions as section 199A dividends.

You should note that if you buy shares of a Fund shortly beforeit makes a distribution, the distribution will be fully taxable toyou even though, as an economic matter, it simply represents areturn of a portion of your investment. This adverse tax resultis known as “buying into a dividend.”

FOREIGN TAXES. The Funds may be subject to foreignwithholding taxes with respect to dividends or interest receivedfrom sources in foreign countries. It is expected that the Multi-Manager Emerging Markets Debt Opportunity Fund, Active MEmerging Markets Equity Fund, Multi-Manager Global ListedInfrastructure Fund, Multi-Manager Global Real Estate Fundand Active M International Equity Fund will be eligible to makean election to treat a proportionate amount of those taxes asconstituting a distribution to each shareholder, which wouldallow you either (1) to credit that proportionate amount oftaxes against U.S. federal income tax liability as a foreign taxcredit (subject to applicable limitations) or (2) to take thatamount as an itemized deduction. The Multi-Manager HighYield Opportunity Fund will not be eligible to make thiselection but this Fund, and, if they choose not to make theelection, the Multi-Manager Emerging Markets DebtOpportunity Fund, Active M Emerging Markets Equity Fund,Multi-Manager Global Listed Infrastructure Fund, Multi-Manager Global Real Estate Fund, and Active M InternationalEquity Fund, will be entitled to deduct such taxes in computingthe amounts they are required to distribute.

SALES AND EXCHANGES. The sale, exchange, or redemption ofFund shares is a taxable event on which a gain or loss may berecognized. For federal income tax purposes, an exchange ofshares of one Fund for shares of another Fund is considered thesame as a sale. The amount of gain or loss is based on thedifference between your tax basis in the Fund shares and theamount you receive for them upon disposition. Generally, youwill recognize long-term capital gain or loss if you have heldyour Fund shares for over twelve months at the time youdispose of them. Gains and losses on shares held for twelvemonths or less will generally constitute short-term capital gains,except that a loss on shares held six months or less will berecharacterized as a long-term capital loss to the extent of anycapital gains distributions that you have received on the shares.A loss realized on a sale or exchange of Fund shares may bedisallowed under the so-called “wash sale” rules to the extentthe shares disposed of are replaced with other shares of thatsame Fund within a period of 61 days beginning 30 days beforeand ending 30 days after the shares are disposed of, such aspursuant to a dividend reinvestment in shares of the Fund. Ifdisallowed, the loss will be reflected in an adjustment to thebasis of the shares acquired.

The Funds are required to compute and report to the InternalRevenue Service and furnish to Fund shareholders cost basisinformation when Fund shares are sold or exchanged. TheFunds have elected to use the average cost method, unless youinstruct the Funds to use a different IRS-accepted cost basismethod, or choose to specifically identify your shares at thetime of each sale or exchange. If your account is held by yourbroker or other financial advisor, they may select a different



cost basis method. In these cases, please contact your broker orother financial advisor to obtain information with respect tothe available methods and elections for your account. Youshould carefully review the cost basis information provided bythe Funds and make any additional basis, holding period orother adjustments that are required when reporting theseamounts on your federal and state income tax returns. Fundshareholders should consult with their tax professionals todetermine the best IRS-accepted cost basis method for their taxsituation and to obtain more information about how the newcost basis reporting requirements apply to them.

IRAS AND OTHER TAX-QUALIFIED PLANS. One major exceptionto the preceding tax principles is that distributions on, andsales, exchanges and redemptions of, shares held in an IRA (orother tax-qualified plan) will not be currently taxable unlessshares are acquired with borrowed funds.

BACKUP WITHHOLDING. The Trust will be required in certaincases to withhold and remit to the U.S. Treasury 24% of thedividends and gross sales proceeds paid to any shareholder(i) who had provided either an incorrect tax identificationnumber or no number at all, (ii) who is subject to backupwithholding by the Internal Revenue Service for failure toreport the receipt of taxable interest or dividend incomeproperly, or (iii) who has failed to certify to the Trust, whenrequired to do so, that he or she is not subject to backupwithholding or that he or she is an “exempt recipient.”

U.S. TAX TREATMENT OF FOREIGN SHAREHOLDERS.

Nonresident aliens, foreign corporations and other foreigninvestors will generally be exempt from U.S. federal income taxon distributions attributable to net capital gains.

The exemption may not apply, however, if an investment in aFund is connected to a trade or business of the foreign investorin the United States or if the foreign investor is present in theUnited States for 183 days or more in a year and certain otherconditions are met.

Fund distributions attributable to other categories of Fundincome, such as dividends from companies whose securities areheld by a Fund, will generally be subject to a 30% withholdingtax when paid to foreign shareholders. The withholding taxmay, however, be reduced (and, in some cases, eliminated)under an applicable tax treaty between the United States and ashareholder’s country of residence or incorporation, providedthat the shareholder furnishes the Fund with a properlycompleted Form W-8BEN or W-8BEN-E, as applicable, toestablish entitlement for these treaty benefits.

Dividends reported as short-term capital gain dividends orinterest-related dividends are not subject to U.S. withholdingtax.

Distributions to foreign shareholders attributable to U.S. realestate gains received from the sale of U.S. real property interestsand real estate gains from REITs or MLPs will be subject towithholding tax at rates up to 21%.

If a foreign shareholder holds more than 5% of a Fund at anytime during the 5-year period ending on the date of dispositionor redemption of shares (a “5% Shareholder”) and the Fund isa United States Real Property Holding Corporation (as definedin the Code), the foreign shareholder will be subject towithholding tax on the gross proceeds at a 15% rate and may berequired to file a U.S. federal income tax return. Foreigncorporations recognizing gain under these rules may be subjectto the U.S. Branch Profits Tax.

A foreign investor will generally not be subject to U.S. tax ongains realized on sales or exchanges of Fund shares unless theinvestment in the Fund is connected to a trade or business ofthe investor in the United States or if the investor is present inthe United States for 183 days or more in a year and certainother conditions are met.

In addition, the Funds are required to withhold 30% tax onpayments to foreign entities that do not meet specifiedinformation reporting requirements under the ForeignAccount Tax Compliance Act.

All foreign investors should consult their own tax professionalsregarding the tax consequences in the United States and theircountry of residence of an investment in a Fund.

STATE AND LOCAL TAXES. You may also be subject to state andlocal taxes on income and gain attributable to your ownershipof Fund shares. State income taxes may not apply, however, tothe portions of a Fund’s distributions, if any, that areattributable to interest earned by the Fund on U.S. governmentsecurities. You should consult your tax professional regardingthe tax status of distributions in your state and locality.

CONSULT YOUR TAX PROFESSIONAL. Your investment in theFunds could have additional tax consequences. You shouldconsult your tax professional for information regarding all taxconsequences applicable to your investments in a Fund. Moretax information relating to the Funds is also provided in theSAI. This short summary is not intended as a substitute forcareful tax planning.



S E C U R I T I E S , T E C H N I Q U E S A N D R I S K S

A D D I T I O N A L I N F O R M A T I O N O N I N V E S T M E N T

O B J E C T I V E S , P R I N C I P A L I N V E S T M E N T S T R A T E G I E S

A N D R E L A T E D R I S K S , D E S C R I P T I O N O F S E C U R I T I E S

A N D C O M M O N I N V E S T M E N T T E C H N I Q U E S

The following provides additional information regarding eachFund’s investment objective, principal investment strategiesand related risks discussed in the Fund Summaries—PrincipalInvestment Strategies section for each Fund, as well asinformation about additional investment strategies andtechniques that a Fund may employ in pursuing its investmentobjective. Principal investment strategies and risks for eachFund are noted in parenthesis. The Funds also may make othertypes of investments to the extent permitted by applicable law.Additional information about the Funds, their investmentstrategies and risks can also be found in the Funds’ SAI.

All investments carry some degree of risk that will affect thevalue of a Fund’s investments, its investment performance andthe price of its shares. As a result, loss of money is a risk ofinvesting in each Fund.

INVESTMENT OBJECTIVES. A Fund’s investment objective maybe changed by the Trust’s Board of Trustees withoutshareholder approval. Shareholders will, however, be notified ofany changes to a Fund’s investment objective. Any changes to aFund’s investment objective may result in a Fund having aninvestment objective different from the investment objectivethat the shareholder considered appropriate at the time ofinvestment in the Fund.

ASSET-BACKED SECURITIES (principal strategy for the Multi-Manager High Yield Opportunity Fund). Asset-backed securitiesare sponsored by entities such as government agencies, banks,financial companies and commercial or industrial companies.Asset-backed securities represent participations in, or aresecured by and payable from, pools of assets such as mortgages,automobile loans, credit card receivables and other financialassets. In effect, these securities “pass through” the monthlypayments that individual borrowers make on their mortgagesor other assets net of any fees paid to the issuers. Examples ofthese include guaranteed mortgage pass-through certificates,collateralized mortgage obligations (“CMOs”) and real estatemortgage investment conduits (“REMICs”). Examples of asset-backed securities also include collateralized debt obligations(“CDOs”), which include collateralized bond obligations(“CBOs”), collateralized loan obligations (“CLOs”) and othersimilarly structured securities.

A CBO is a trust typically collateralized by a pool that is backedby a diversified pool of high risk, below-investment grade fixed-income securities. A CLO is a trust typically collateralized by apool of loans that may include, among others, domestic andforeign senior secured loans, senior unsecured loans, and other

subordinate corporate loans, including loans that may be ratedbelow-investment grade or equivalent unrated loans.

INVESTMENT STRATEGY. The Multi-Manager Emerging MarketsDebt Opportunity Fund and Multi-Manager High YieldOpportunity Fund each may purchase securities that are issuedor guaranteed by the U.S. government or by its agencies,instrumentalities, as well as other types of asset-backedsecurities that are “Eligible Securities” as defined by the SEC.

The Multi-Manager Emerging Markets Debt Opportunity Fundmay invest in CDOs, CBOs and CLOs, although investments insuch securities are not anticipated to be a principal investmentstrategy of the Fund.

The Multi-Manager High Yield Opportunity Fund may alsoinvest in CDOs. Such securities are subject to the same qualityrequirements as the other types of fixed-income securities thatare held by the Multi-Manager High Yield Opportunity Fund.

SPECIAL RISKS. In addition to credit and market risk, asset-backed securities may involve prepayment risk because theunderlying assets (loans) may be prepaid at any time.Prepayment (or call) risk is the risk that an issuer will exerciseits right to pay principal on an obligation held by the Fund(such as an asset-backed security) sooner than expected. Thismay happen during a period of falling interest rates.Accordingly, a Fund’s ability to maintain positions in suchsecurities will be affected by reductions in the principal amountof such securities resulting from prepayments, and its ability toreinvest the returns of principal at comparable yields is subjectto generally prevailing interest rates at that time.

The value of these securities also may change because of actualor perceived changes in the creditworthiness of the originator,the service agent, the financial institution providing the creditsupport or the counterparty. Unlike mortgage-backed securitiesissued or guaranteed by agencies of the U.S. government orgovernment-sponsored enterprises, mortgage-backed securitiesissued by private issuers do not have a government orgovernment-sponsored enterprise guarantee (but may haveother credit enhancement), and may, and frequently do, haveless favorable collateral, credit risk or other underwritingcharacteristics. Credit supports generally apply only to afraction of a security’s value. Like other fixed-income securities,when interest rates rise, the value of an asset-backed securitygenerally will decline. However, when interest rates decline, thevalue of an asset-backed security with prepayment features maynot increase as much as that of other fixed-income securities. Inaddition, non-mortgage asset-backed securities involve certainrisks not presented by mortgage-backed securities. Primarily,these securities do not have the benefit of the same securityinterest in the underlying collateral. Credit card receivablesgenerally are unsecured, and the debtors are entitled to the



protection of a number of state and federal consumer creditlaws. Automobile receivables are subject to the risk that thetrustee for the holders of the automobile receivables may nothave an effective security interest in all of the obligationsbacking the receivables. If the issuer of the security has nosecurity interest in the related collateral, there is the risk that aFund could lose money if the issuer defaults. CBOs and CLOsare generally offered in tranches that vary in risk and yield.Both CBOs and CLOs can experience substantial losses due toactual defaults of the underlying collateral, increased sensitivityto defaults due to collateral default and disappearance of juniortranches that protect the more senior tranches, marketanticipation of defaults and aversion to CBO or CLO securitiesas a class. The economic recession that commenced in theUnited States in 2008 introduced a period of heightened levelsof default on the receivables and loans underlying asset-backedsecurities than were historically experienced. A future economicdownturn could increase the risk that such assets underlyingasset-backed securities purchased by the Funds will also suffergreater levels of default than were historically experienced.

In addition to prepayment risk, investments in mortgage-backed securities comprised of subprime mortgages andinvestments in other asset-backed securities ofunderperforming assets may be subject to a higher degree ofcredit risk, valuation risk, and liquidity risk.

BORROWINGS AND REVERSE REPURCHASE AGREEMENTS. TheFunds may borrow money from banks and may enter intoreverse repurchase agreements with banks and other financialinstitutions.

INVESTMENT STRATEGY. Each Fund may borrow money frombanks and enter into reverse repurchase agreements with banksand other financial institutions in amounts not exceedingone-fourth of the value of its total assets (including the amountborrowed). The Funds may enter into reverse repurchaseagreements when the Investment Adviser or Sub-Advisersexpect that the interest income to be earned from theinvestment of the transaction proceeds will be greater than therelated interest expense.

SPECIAL RISKS. Borrowings and reverse repurchase agreementsinvolve leveraging. Reverse repurchase agreements involve thesale of securities held by a Fund subject to the Fund’sagreement to repurchase them at a mutually agreed upon dateand price (including interest). If the securities held by theFunds decline in value while these transactions are outstanding,the NAV of the Funds’ outstanding shares will decline in valueby proportionately more than the decline in value of thesecurities. In addition, reverse repurchase agreements involvethe risks that (a) the interest income earned by a Fund (fromthe investment of the proceeds) will be less than the interestexpense of the transaction; (b) the market value of the securities

sold by a Fund will decline below the price the Fund isobligated to pay to repurchase the securities; and (c) thesecurities may not be returned to the Fund.

CONVERTIBLE SECURITIES (principal strategy for the Multi-Manager Emerging Markets Debt Opportunity Fund and Multi-Manager High Yield Opportunity Fund). A convertible securityis a bond or preferred stock that may be converted (exchanged)into the common stock of the issuing company within aspecified time period for a specified number of shares.Convertible securities offer a way to participate in the capitalappreciation of the common stock into which the securities areconvertible, while earning higher current income than isavailable from the common stock.

INVESTMENT STRATEGY. The Multi-Manager Emerging MarketsDebt Opportunity Fund and Multi-Manager High YieldOpportunity Fund each may acquire convertible securities aspart of its principal investment strategy. Each of the otherFunds also may acquire convertible securities. Multi-ManagerEmerging Markets Debt Opportunity Fund and Multi-ManagerHigh Yield Opportunity Fund may invest without limitation inconvertible securities that are rated non-investment grade. Eachof the other Funds may invest up to 15% of its total assets inconvertible securities that are rated non-investment grade atthe time of purchase, although generally convertible securitieswill be rated investment grade at the time of purchase, whenthe Sub-Advisers determine that such securities are desirable inlight of the Funds’ investment objectives.

SPECIAL RISKS. The price of a convertible security normally willvary in some proportion to changes in the price of theunderlying common stock because of either a conversion orexercise feature. However, the value of a convertible securitymay not increase or decrease as rapidly as the underlyingcommon stock. Additionally, convertible securities may besubject to market risk, credit and counterparty risk, interestrate risk and other market and issuer-specific risks that apply tothe underlying common stock. While convertible securitiesgenerally offer lower interest or dividend yields thannon-convertible fixed-income securities of similar quality, theirvalue tends to increase as the market value of the underlyingstock increases and to decrease when the value of theunderlying stock decreases, and may vary in price in responseto changes in the price of the underlying common stock, withgreater volatility. Also, a Fund may be forced to convert asecurity before it would otherwise choose, which may have anadverse effect on the Fund’s return and its ability to achieve itsinvestment objective.

CREDIT (OR DEFAULT) RISK (principal risk for the EmergingMarkets Debt Opportunity Fund and the High Yield OpportunityFund). Credit risk, also called default risk, is the risk that anissuer of fixed income securities held by a Fund may default on



its obligation to pay interest and repay principal. Generally, thelower the credit rating of a security, the greater the risk that theissuer of the security will default on its obligation. High qualitysecurities are generally believed to have relatively low degrees ofcredit risk. The Funds intend to enter into financialtransactions with counterparties that are creditworthy at thetime of the transactions. There is always the risk that theInvestment Adviser’s or Sub-Adviser’s analysis ofcreditworthiness is incorrect or may change due to marketconditions. Concerns over an issuer’s ability to make principalor interest payments may cause the value of a fixed incomesecurity to decline. To the extent that a Fund focuses itstransactions with a limited number of counterparties, it will bemore susceptible to the risks associated with one or morecounterparties. In addition, the Funds may incur expenses in aneffort to protect the Fund’s interests or enforce its rights againstan issuer, guarantor or counterparty or may be hindered ordelayed in exercising these rights.

CREDIT FACILITY AND BORROWING. The Funds, the otherfunds of the Trust, and affiliated funds of NorthernInstitutional Funds (each a “Portfolio”, and together the“Portfolios”) have jointly entered into a revolving credit facility(the “Credit Facility”) whereby the Funds, the other funds inthe Trust, and the Portfolios may borrow for the temporaryfunding of shareholder redemptions or for other temporary oremergency purposes. Pursuant to the Credit Facility, theparticipating Portfolios and funds may borrow up to anaggregate commitment amount of $250 million (the“Commitment Limit”) at any time, subject to asset coverageand other limitations as specified in the Credit Facility andunder the 1940 Act. The Funds may borrow up to themaximum amount allowable under their current prospectusesand SAIs, subject to various other legal, regulatory orcontractual limits, including the asset coverage limits in theCredit Facility. Borrowing results in interest expense and otherfees and expenses for the Funds that may impact a Fund’sexpenses, including any net expense ratios. The costs ofborrowing may reduce a Fund’s yield. If a Fund borrowspursuant to the Credit Facility, it is charged interest at avariable rate. Each Fund also pays a commitment fee equal toits pro rata share of the unused portion of the Credit Facility.The availability of funds under the Credit Facility can beaffected by other participating Portfolios’ or funds’ borrowingsunder the Credit Facility. As such, a Fund may be unable toborrow (or borrow further) under the Credit Facility if theCommitment Limit has been reached.

CURRENCY SWAPS (principal strategy for the Multi-ManagerEmerging Markets Debt Opportunity Fund). Currency swaps arecontracts that obligate the Fund and another party to exchangetheir rights to pay or receive specified amounts of currency,respectively.

INVESTMENT STRATEGY. To the extent consistent with theirinvestment objectives and strategies, the Multi-ManagerEmerging Markets Debt Opportunity Fund and Multi-ManagerGlobal Listed Infrastructure Fund may enter into currencyswap transactions for hedging purposes.

SPECIAL RISKS. The use of currency swaps is a highly specializedactivity that involves investment techniques and risks differentfrom those associated with ordinary portfolio securitiestransactions. Like other derivative securities, these instrumentscan be highly volatile. If the Sub-Adviser is incorrect in itsforecasts of currency exchange rates, the investmentperformance of the Fund would be less favorable than it wouldhave been if these instruments were not used. Because theseinstruments normally are illiquid, the Fund may not be able toterminate its obligations when desired. The Fund also maysuffer a loss if the other party to a transaction defaults.

CUSTODIAL RECEIPTS (principal risk for the Emerging MarketsEquity Fund and the International Equity Fund). Custodialreceipts are participations in trusts that hold U.S. government,bank, corporate or other obligations. U.S. Treasury securitiesare sold under such names as TIGRs (Treasury Income GrowthReceipts) and CATS (Certificates of Accrual on TreasurySecurities). Like other stripped obligations, they entitle theholder to future interest payments or principal payments orboth on securities held by the custodian.

INVESTMENT STRATEGY. To the extent consistent with theirinvestment objectives and strategies, the Funds may invest aportion of their assets in custodial receipts. Investments by theMulti-Manager High Yield Opportunity Fund in custodialreceipts, if any, are anticipated to be minimal and will notexceed 20% of the value of the Fund’s net assets.

SPECIAL RISKS. Like other stripped securities (which aredescribed below), stripped custodial receipts may be subject togreater price volatility than ordinary debt obligations becauseof the way in which their principal and interest are returned toinvestors. Custodial receipts may not be considered obligationsof the U.S. government or other issuer of the security held bythe custodian for the purpose of securities laws. If for taxpurposes a Fund is not considered to be the owner of thesecurities held in the underlying trust or custodial account, theFund may suffer adverse tax consequences. As a holder ofcustodial receipts, a Fund will bear its proportionate share ofthe fees or expenses charged to the custodial account.

CYBERSECURITY RISK (principal risk for all Funds). With theincreased use of the Internet and because informationtechnology (“IT”) systems and digital data underlie most of theFunds’ operations, the Funds and their investment adviser,custodian, transfer agent, distributor and other serviceproviders and the financial intermediaries of each (collectively“Service Providers”) are exposed to the risk that their



operations and data may be compromised as a result of internaland external cyber-failures, breaches or attacks (“Cyber Risk”).This could occur as a result of malicious or criminal cyber-attacks. Cyber-attacks include actions taken to: (i) steal orcorrupt data maintained online or digitally, (ii) gainunauthorized access to or release confidential information,(iii) shut down a Fund or Service Provider website throughdenial-of-service attacks, or (iv) otherwise disrupt normalbusiness operations. However, events arising from humanerror, faulty or inadequately implemented policies andprocedures or other systems failures unrelated to any externalcyber-threat may have effects similar to those caused bydeliberate cyber-attacks.

Successful cyber-attacks or other cyber-failures or eventsaffecting the Funds or their Service Providers may adverselyimpact a Fund or its shareholders. For instance, such attacks,failures or other events may interfere with the processing ofshareholder transactions, impact a Fund’s ability to calculate itsNAV, cause the release of private shareholder information orconfidential Fund information, impede trading, or causereputational damage. Such attacks, failures or other eventscould also subject the Funds or their Service Providers toregulatory fines, penalties or financial losses, reimbursement orother compensation costs, and/or additional compliance costs.Insurance protection and contractual indemnificationprovisions may be insufficient to cover these losses. The Fundsor their Service Providers may also incur significant costs tomanage and control Cyber Risk. While the Funds and theirService Providers have established IT and data securityprograms and have in place business continuity plans and othersystems designed to prevent losses and mitigate Cyber Risk,there are inherent limitations in such plans and systems,including the possibility that certain risks have not beenidentified or that cyber-attacks may be highly sophisticated.

Cyber Risks are also present for issuers of securities or otherinstruments in which the Funds invest, which could result inmaterial adverse consequences for such issuers, and may causea Fund’s investment in such issuers to lose value.

DEBT EXTENSION RISK (principal risk for the Multi-ManagerEmerging Markets Debt Opportunity Fund and Multi-ManagerHigh Yield Opportunity Fund) Funds that invest in fixed incomesecurities may be subject to the risk that an issuer will exerciseits right to pay principal on an obligation held by the Fund(such as an asset-backed security) later than expected. This mayhappen during a period of rising interest rates. Under thesecircumstances, the value of the obligation will decrease and theFund will suffer from the inability to invest in higher yieldingsecurities.

DEPOSITARY RECEIPTS RISK (principal risk for the Active MEmerging Markets Equity Fund). Foreign securities may trade in

the form of depositary receipts. In addition to investment risksassociated with the underlying issuer, depositary receipts mayexpose the Fund to additional risks associated withnon-uniform terms that apply to depositary receipt programs,including credit exposure to the depository bank and to thesponsors and other parties with whom the depository bankestablishes the programs, currency, political, economic, marketrisks and the risk of an illiquid market for depositary receipts.Depositary receipts are generally subject to the same risks as theforeign securities that they evidence or into which they may beconverted. Depositary receipts may not track the price of theunderlying foreign securities on which they are based, may havelimited voting rights, and may have a distribution subject to afee charged by the depository. As a result, equity shares of theunderlying issuer may trade at a discount or premium to themarket price of the depositary receipts. Some institutionsissuing depositary receipts may not be sponsored by the issuer.Unsponsored programs generally expose investors to greaterrisks than sponsored programs and do not provide holders withmany of the shareholder benefits that come from investing in asponsored depositary receipt.

DERIVATIVES (principal risk for the Multi-Manager EmergingMarkets Debt Opportunity Fund). Each of the Funds maypurchase certain “derivative” instruments for hedgingpurposes. The Multi-Manager Emerging Markets DebtOpportunity Fund also may purchase certain “derivative”instruments for other purposes. A derivative is a financialinstrument whose value is derived from, or based upon, theperformance of underlying assets, interest or currency exchangerates, or other indices and may be leveraged. Derivativesinclude futures contracts, options, interest rate and currencyswaps, credit default swaps, equity swaps, forward currencycontracts, structured securities such as collateralized mortgageobligations and other types of asset-backed securities,“stripped” securities and various floating rate instruments.

INVESTMENT STRATEGY. Under normal market conditions, theMulti-Manager Emerging Markets Debt Opportunity Fundmay invest in derivative securities, including options, futures,forward currency contracts and currency, credit default andequity swaps if the potential risks and rewards are consistentwith the Fund’s objective, strategies and overall risk profile. Inunusual circumstances, including times of increased marketvolatility, the Multi-Manager Emerging Markets DebtOpportunity Fund may make more significant investments inderivatives. The Fund may use derivatives for hedging purposesto offset a potential loss in one position by establishing aninterest in an opposite position, or to gain exposure to certaincountries or currencies.

Each of the other Funds, under normal market conditions, mayinvest in derivative securities including options, futures



contracts, forward currency contracts and currency and equityswaps if the potential risks and rewards are consistent with theFund’s objective, strategies and overall risk profile. In unusualcircumstances, including times of increased market volatility, aFund may make more significant investments in derivatives.The Funds may use derivatives for hedging purposes to offset apotential loss in one position by establishing an interest in anopposite position, in anticipation of the purchase of securitiesor for liquidity management purposes. The Funds do notintend to use derivatives for speculative purposes (i.e., to investfor potential income or capital gain). It is the current policy ofthe Funds’ Board of Trustees to limit investments in derivativesby these Funds to investments for hedging purposes.

SPECIAL RISKS. Engaging in derivative transactions involvesspecial risks, including (a) market risk that a Fund’s derivativesposition will lose value; (b) credit risk that the counterparty tothe transaction will default; (c) leveraging risk that the value ofthe derivative instrument will decline more than the value ofthe assets on which it is based; (d) risks pertaining to illiquidinvestments that a Fund will be unable to sell its positionbecause of lack of market depth or disruption; (e) pricing riskthat the value of a derivative instrument will be difficult todetermine; and (f) operations risk that loss will occur as a resultof inadequate systems or human error. Many types ofderivatives have been developed recently and have not beentested over complete market cycles. For these reasons, a Fundmay suffer a loss whether or not the analysis of the Sub-Adviseris accurate.

EQUITY SECURITIES (principal strategy for the Active M EmergingMarkets Equity Fund, Active M International Equity Fund,Multi-Manager Global Listed Infrastructure Fund and Multi-Manager Global Real Estate Fund). “Equity securities” includecommon stocks, preferred stocks, investment companiesincluding exchange-traded funds (“ETFs”), interests in realestate investment trusts (“REITs”), convertible securities,equity interests in trusts, partnerships, joint ventures, limitedliability companies and similar enterprises, warrants, stockpurchase rights and synthetic and derivative instruments thathave economic characteristics similar to equity securities.

INVESTMENT STRATEGY. Each of the Funds, except the Multi-Manager Emerging Markets Debt Opportunity Fund and Multi-Manager High Yield Opportunity Fund, invests primarily inequity securities. The Multi-Manager Emerging Markets DebtOpportunity Fund and the Multi-Manager High YieldOpportunity Fund may invest in equity securities to the extentconsistent with their investment objectives and strategies.

SPECIAL RISKS. Investing in equity securities involves marketrisk. Market risk is the risk that the value of the securities inwhich a Fund invests may go up or down in response to theprospects of individual issuers and/or general economic

conditions. Securities markets may experience great short-termvolatility and may fall sharply at times. Different markets maybehave differently from each other and a foreign market maymove in the opposite direction from the U.S. market. Stockprices have historically risen and fallen in periodic cycles. Ingeneral, the values of equity investments fluctuate in responseto the activities of individual companies and in response togeneral market and economic conditions. Individual companiesmay report poor results or be negatively affected by industrytrends and developments, and the stock prices of suchcompanies may decline in response. Price changes may betemporary or may last for extended periods. Accordingly, thevalues of the equity investments that a Fund holds may declineover short or extended periods. This volatility means that thevalue of your investment in the Funds may increase or decrease.You could lose money over short periods due to fluctuation in aFund’s NAV in response to market movements, and overlonger periods during market downturns.

Over the past several years, stock markets have experiencedsubstantial price volatility.

EQUITY SWAPS. Equity swaps allow the parties to the swapagreement to exchange components of return on one equityinvestment (e.g., a basket of equity securities or an index) for acomponent of return on another non-equity or equityinvestment, including an exchange of differential rates of return.

INVESTMENT STRATEGY. The Funds, except the Multi-ManagerHigh Yield Opportunity Fund, may invest in equity swaps forhedging purposes, in anticipation of the purchase of securitiesand for liquidity management purposes but not for speculativepurposes or to seek to enhance total return. Equity swaps alsomay be used to invest in a market without owning or takingphysical custody of securities in circumstances where directinvestment may be restricted for legal reasons or is otherwiseimpractical.

SPECIAL RISKS. Equity swaps are derivative instruments andtheir values can be very volatile. To the extent that aSub-Adviser does not accurately analyze and predict thepotential relative fluctuation on the components swapped withthe other party, a Fund may suffer a loss, which is potentiallyunlimited. The value of some components of an equity swap(such as the dividends on a common stock) also may besensitive to changes in interest rates. Furthermore, during theperiod a swap is outstanding, a Fund may suffer a loss if thecounterparty defaults. Because equity swaps normally areilliquid, a Fund may not be able to terminate its obligationswhen desired.

EXCHANGE RATE-RELATED SECURITIES. Exchange rate-relatedsecurities represent certain foreign debt obligations whoseprincipal values are linked to a foreign currency but which arerepaid in U.S. dollars.



INVESTMENT STRATEGY. Each of the Funds may invest inexchange rate-related securities.

SPECIAL RISKS. The principal payable on an exchange rate-related security is subject to currency risk. In addition, thepotential illiquidity and high volatility of the foreign exchangemarket may make exchange rate-related securities difficult tosell prior to maturity at an appropriate price.

FINANCIAL SECTOR RISK (principal risk for the Active MEmerging Markets Equity Fund and Active M InternationalEquity Fund). Companies in the U.S. and non-U.S. financialssector of the economy, including those in the banking industry,are often subject to extensive governmental regulation andintervention, which may adversely affect the scope of theiractivities, the prices they can charge and the amount of capitalthey must maintain. Governmental regulation may changefrequently and may have significant adverse consequences forcompanies in the financial sector, including effects notintended by such regulation. The impact of recent or futureregulation on any individual financial company, the bankingindustry or on the sector as a whole cannot be predicted.Certain risks may impact the value of investments in thefinancial sector more severely than those of investments outsidethis sector, including the risks associated with companies thatoperate with substantial financial leverage. Companies in thefinancial sector may also be adversely affected by increases ininterest rates and loan losses, decreases in the availability ofmoney or asset valuations, credit rating downgrades andadverse conditions in other related markets. Insurancecompanies, in particular, may be subject to severe pricecompetition and/or rate regulation, which may have an adverseimpact on their profitability.

In the recent past, deterioration of the credit markets impacteda broad range of mortgage, asset backed, auction rate, sovereigndebt and other markets, including U.S. and non-U.S. credit andinterbank money markets, thereby affecting a wide range offinancial institutions and markets. A number of large financialinstitutions have failed, have merged with stronger institutionsor have had significant government infusions of capital.Instability in the financial markets has caused certain financialcompanies to incur large losses. Some financial companiesexperienced declines in the valuations of their assets, tookactions to raise capital (such as the issuance of debt or equitysecurities), or even ceased operations. Some financialcompanies borrowed significant amounts of capital fromgovernment sources and may face future government imposedrestrictions on their businesses or increased governmentintervention. Those actions caused the securities of manyfinancial companies to decline in value. The financial sector isparticularly sensitive to fluctuations in interest rates.

FOREIGN CUSTODY RISK (principal risk for all Funds). TheFunds may hold foreign securities and cash with foreign banks,agents, and securities depositories appointed by the Funds’custodian (each a “Foreign Custodian”). Some ForeignCustodians may be recently organized or new to the foreigncustody business. In some countries, Foreign Custodians maybe subject to little or no regulatory oversight over orindependent evaluation of their operations. Further, the laws ofcertain countries may place limitations on the Funds’ ability torecover its assets if a Foreign Custodian enters bankruptcy.Investments in emerging markets may be subject to evengreater custody risks than investments in more developedmarkets. Custody services in emerging market countries arevery often undeveloped and may be considerably less well-regulated than in more developed countries, and thus may notafford the same level of investor protection as would apply indeveloped countries.

FOREIGN INVESTMENTS (principal strategy for all Funds).Foreign securities include direct investments in non-U.S.dollar-denominated securities traded primarily outside of theUnited States and dollar-denominated securities of foreignissuers. Foreign securities also include indirect investmentssuch as American Depositary Receipts (“ADRs”), EuropeanDepositary Receipts (“EDRs”) and Global Depositary Receipts(“GDRs”). ADRs are U.S. dollar-denominated receiptsrepresenting shares of foreign-based corporations. ADRs arereceipts that are traded in the United States, and entitle theholder to all dividend and capital gain distributions that arepaid out on the underlying foreign shares. EDRs and GDRs arereceipts that often trade on foreign exchanges. They representownership in an underlying foreign or U.S. security andgenerally are denominated in a foreign currency. Foreigngovernment obligations may include debt obligations ofsupranational entities, including international organizations(such as The International Bank for Reconstruction andDevelopment (also known as the World Bank)) andinternational banking institutions and related governmentagencies.

INVESTMENT STRATEGY. The Active M Emerging Markets EquityFund, Multi-Manager Global Listed Infrastructure Fund,Multi-Manager Global Real Estate Fund and Active MInternational Equity Fund intend to invest a substantial portionof their total assets in foreign securities. The Multi-ManagerEmerging Markets Debt Opportunity Fund will investprimarily in securities of foreign (non-U.S.) companies. Undernormal circumstances, the Multi-Manager Global ListedInfrastructure Fund will invest at least 40%, and may invest upto 100% of its net assets, in the securities of companieseconomically tied to a foreign (non-U.S.) country. Indetermining if a security is economically tied to a foreign



(non-U.S.) country, the Fund generally looks to the country ofincorporation of the issuer as listed on Bloomberg, a widelyrecognized provider of market information. However, the Fundmay determine a security is economically tied to a foreigncountry based on other factors, such as an issuer’s country ofdomicile, where the majority of an issuer’s revenues aregenerated or where an issuer’s primary exchange is located. As aresult, a security may be economically tied to more than onecountry. With respect to derivative instruments, the Fundgenerally considers such instruments to be economically tied toforeign countries if the underlying assets of the derivatives are(i) foreign currencies (or baskets or indexes of such currencies);(ii) instruments or securities that are issued by foreigngovernments or by an issuer economically tied to a foreigncountry as described above; or (iii) for certain money marketinstruments, if either the issuer or the guarantor of such moneymarket instrument is an issuer economically tied to a foreigncountry as described above. Under normal circumstances, theMulti-Manager Global Real Estate Fund and Active MInternational Equity Fund will invest significantly (at least40%) in companies that are located, headquartered,incorporated or otherwise organized outside the U.S. TheMulti-Manager Global Listed Infrastructure Fund, Multi-Manager Global Real Estate Fund and Active M InternationalEquity Fund expect their foreign investments to be allocatedamong companies that are diversified among various regions,countries including the United States (but no less than threedifferent countries other than the United States), industries andcapitalization ranges.

The Multi-Manager High Yield Opportunity Fund may investup to 25% of its total assets in foreign fixed-income securities,including those of issuers located in emerging market counties.The Multi-Manager High Yield Opportunity Fund also mayinvest in foreign time deposits and other short-terminstruments.

The Active M Emerging Markets Equity Fund and the Multi-Manager Emerging Markets Debt Opportunity Fund intend toinvest, and the Multi-Manager Global Listed InfrastructureFund may invest, a substantial portion of their respective totalassets in foreign countries that are considered emergingmarkets. Such countries may include, but are not limited to:Argentina, Bahrain, Bangladesh, Benin, Brazil, Burkina Faso,Chile, China, Colombia, Croatia, Czech Republic, Egypt,Estonia, Greece, Guinea-Bissau, Hungary, India, Indonesia,Ivory Coast, Jordan, Kazakhstan, Kenya, Korea, Kuwait,Lebanon, Lithuania, Malaysia, Mali, Mauritius, Mexico,Morocco, Niger, Nigeria, Oman, Pakistan, Peru, thePhilippines, Poland, Qatar, Romania, Russia, Saudi Arabia,Senegal, Serbia, Slovenia, South Africa, Sri Lanka, Taiwan,Thailand, Togo, Tunisia, Turkey, United Arab Emirates andVietnam.

The Multi-Manager Global Listed Infrastructure Fund mayinvest more than 25% of its total assets in the securities ofissuers located in a single foreign country or a single geographicregion having securities markets that are highly developed,liquid and subject to extensive regulation. Such regions mayinclude, but are not limited to North America, Pacific Asia andEurope.

The Multi-Manager Global Real Estate Fund may invest morethan 25% of its total assets in the securities of issuers located ina single foreign country or a single geographic region havingsecurities markets that are highly developed, liquid and subjectto extensive regulation. Such regions may include, but are notlimited to North America, Pacific Asia and Europe. The Fundcurrently anticipates that it will invest more than 25% of itsassets in issuers located in the United States.

The Active M International Equity Fund may invest more than25% of its net assets in the securities of issuers located in asingle foreign country having securities markets that are highlydeveloped, liquid and subject to extensive regulation. Suchcountries may include, but are not limited to Japan, the UnitedKingdom, France, Germany and Switzerland. The Fund mayinvest up to 40% of its net assets in emerging markets.

GENERAL. Foreign securities involve special risks and costs,which are considered by the Sub-Advisers in evaluating thecreditworthiness of issuers and making investment decisionsfor the Funds. Foreign securities fluctuate in price because ofpolitical, financial, social and economic events in foreigncountries (including, for example, military confrontations, warand terrorism). A foreign security could also lose value becauseof more or less stringent foreign securities regulations and lessstringent accounting and disclosure standards. In addition,foreign markets may have greater volatility than domesticmarkets and foreign securities may be less liquid and harder tovalue than domestic securities. Certain foreign markets mayrely heavily on particular industries or foreign capital and aremore vulnerable to diplomatic developments, the imposition ofeconomic sanctions against a particular country or countries,organizations, entities and/or individuals, changes ininternational trading patterns, trade barriers, and otherprotectionist or retaliatory measures. International tradebarriers or economic sanctions against foreign countries,organizations, entities and/or individuals may adversely affect aFund’s foreign holdings or exposures.

Foreign securities, and in particular foreign debt securities, aresensitive to changes in interest rates. In addition, investment inthe securities of foreign governments involves the risk thatforeign governments may default on their obligations or mayotherwise not respect the integrity of their obligations. Theperformance of investments in securities denominated in aforeign currency also will depend, in part, on the strength of the



foreign currency against the U.S. dollar and the interest rateenvironment in the country issuing the currency. Absent otherevents that otherwise could affect the value of a foreign security(such as a change in the political climate or an issuer’s creditquality), appreciation in the value of the foreign currencygenerally results in an increase in value of a foreign currency-denominated security in terms of U.S. dollars. A decline in thevalue of the foreign currency relative to the U.S. dollar generallyresults in a decrease in value of a foreign currency-denominated security. Additionally, many countriesthroughout the world are dependent on a healthy U.S.economy and are adversely affected when the U.S. economyweakens or its markets decline.

Investment in foreign securities may involve higher costs thaninvestment in U.S. securities, including higher transaction andcustody costs as well as the imposition of additional taxes byforeign governments. Foreign investments also may involverisks associated with the level of currency exchange rates, lesscomplete financial information about the issuers, less marketliquidity, more market volatility and political instability.Moreover, clearance and settlement procedures may differ fromthose in the U.S. and in certain markets such procedures havebeen unable to keep pace with the volume of securitiestransactions, thus making it difficult to conduct suchtransactions. Future political and economic developments, thepossible imposition of withholding taxes on dividend income,the possible seizure or nationalization of foreign holdings, thepossible establishment of exchange controls or freezes on theconvertibility of currency, trade restrictions (including tariffs)or the adoption of other governmental restrictions mightadversely affect an investment in foreign securities.Additionally, foreign banks and foreign branches of domesticbanks may be subject to less stringent reserve requirements andto different accounting, auditing and recordkeepingrequirements. Sub-Advisors may determine not to invest in, ormay limit a Fund’s overall investment in, a particular issuer,country or geographic region due to, among other things,heightened risks regarding repatriation restrictions,confiscation of assets and property, expropriation ornationalization.

While the Funds’ investments may, if permitted, bedenominated in foreign currencies, the portfolio securities andother assets held by the Funds are valued in U.S. dollars. Pricefluctuations may occur in the dollar value of foreign securitiesbecause of changing currency exchange rates or, in the case ofhedged positions, because the U.S. dollar declines in valuerelative to the currency hedged. Currency exchange rates mayfluctuate significantly over short periods of time causing aFund’s NAV to fluctuate as well. Currency exchange rates canbe affected unpredictably by the intervention or the failure tointervene by U.S. or foreign governments or central banks, or

by currency controls or political developments in the UnitedStates or abroad. To the extent that a Fund is invested inforeign securities while also maintaining currency positions, itmay be exposed to greater combined risk. The Funds’respective net currency positions may expose them to risksindependent of their securities positions.

A Fund’s assets may be concentrated in countries located in thesame geographic region. This concentration will subject theFund to risks associated with that particular region, such asgeneral and local economic, political and social conditions. TheMulti-Manager Global Listed Infrastructure Fund and Active MInternational Equity Fund may invest more than 25% of itstotal assets in the securities of issuers located in a single countryor geographic region, and such an investment will subject theFund to increased foreign securities risk with respect to theparticular country or geographic region.

The Funds may operate in euros and/or hold euros and/oreuro-denominated bonds and other obligations. The eurorequires participation of multiple sovereign states forming theEuro zone and is therefore sensitive to the credit and generaleconomic and political positions of each such state, including,each state’s actual and intended ongoing engagement with and/or support for the other sovereign states then forming theEuropean Union (“EU”), in particular those within the Eurozone. Changes in these factors might materially adverselyimpact the value of securities in which a Fund has invested.

European countries can be significantly affected by the tightfiscal and monetary controls that the European Economic andMonetary Union (“EMU”) imposes for membership. Europe’seconomies are diverse, its governments are decentralized, andits cultures vary widely. Several EU countries, including Greece,Ireland, Italy, Spain and Portugal have faced budget issues,some of which may have negative long-term effects for theeconomies of those countries and other EU countries. There iscontinued concern about national-level support for the euroand the accompanying coordination of fiscal and wage policyamong EMU member countries. Member countries arerequired to maintain tight control over inflation, public debt,and budget deficit to qualify for membership in the EMU.These requirements can severely limit the ability of EMUmember countries to implement monetary policy to addressregional economic conditions.

In addition, voters in the United Kingdom (“UK”) haveapproved withdrawal from the EU. Securities issued bycompanies domiciled in the UK could be subject to changingregulatory and tax regimes. Banking and financial servicescompanies that operate in the UK or EU could bedisproportionately impacted by those actions. Other countriesmay seek to withdraw from the EU and/or abandon the euro,the common currency of the EU, which could exacerbate



market and currency volatility and negatively impact the Funds’investments in securities issued by companies located in EUcountries. A number of countries in Europe have sufferedterror attacks, and additional attacks may occur in the future.Ukraine has experienced ongoing military conflict; this conflictmay expand and military attacks could occur in Europe.Europe has also been struggling with mass migration from theMiddle East and Africa. Recent and upcoming Europeanelections could, depending on the outcomes, further call intoquestion the future direction of the EU. The ultimate effects ofthese events and other socio-political or geopolitical issues arenot known but could profoundly affect global economies andmarkets. The impact of these actions, especially if they occur ina disorderly fashion, is not clear, but could be significant andfar-reaching. Whether or not a Fund invests in securities ofissuers located in Europe or with significant exposure toEuropean issuers or countries, these events could negativelyaffect the value and liquidity of a Fund’s investments.

Other economic challenges facing Europe include high levels ofpublic debt, significant rates of unemployment, agingpopulations and heavy regulation in certain economic sectors.European policy makers have taken unprecedented steps torespond to the economic crisis and to boost growth in theregion, which has increased the risk that regulatory uncertaintycould negatively affect the value of a Fund’s investments.

As the EU continues to grow in size with the addition of newmember countries, the candidate countries’ accessions maybecome more controversial to existing EU members. Somemember states may repudiate certain candidate countriesjoining the EU upon concerns about possible economic,immigration and cultural implications. Also, Russia may beopposed to the expansion of the EU to members of the formerSoviet bloc and may, at times, take actions that could negativelyimpact the EU economic activity.

SPECIAL RISKS—EMERGING AND FRONTIER MARKETS. Additionalrisks are involved when investing in countries with emergingeconomies or securities markets. The Active M EmergingMarkets Equity Fund and Multi-Manager Emerging MarketsDebt Opportunity Fund invest primarily in emerging andfrontier market issuers. The Multi-Manager Global ListedInfrastructure Fund may invest a substantial portion of its totalassets in foreign countries that are considered emerging orfrontier markets. The Multi-Manager Global Real Estate Fundand Active M International Equity Fund may invest inemerging market securities to a lesser extent. Emerging andfrontier market countries generally are located in the Asia andPacific regions, the Middle East, Eastern Europe, Central andSouth America and Africa. Such countries may include, but arenot limited to: Angola, Argentina, Azerbaijan, Bahamas,Bahrain, Bangladesh, Belarus, Benin, Bermuda, Brazil, British

Virgin Islands, Burkina Faso, Cayman Islands, Chile, China,Colombia, Costa Rica, Cote D’Ivoire, Croatia, Czech Republic,Dominican Republic, Ecuador, Egypt, El Salvador, Estonia,Gabon, Georgia, Ghana, Greece, Guatemala, Guinea-Bissau,Honduras, Hungary, India, Indonesia, Ivory Coast, Jamaica,Jordan, Kazakhstan, Kenya, Korea, Kuwait, Latvia, Lebanon,Lithuania, Malaysia, Mali, Mauritius, Mexico, Mongolia,Morocco, Mozambique, Namibia, Niger, Nigeria, Oman,Papua New Guinea, Pakistan, Panama, Paraguay, Peru,Philippines, Poland, Qatar, Romania, Russia, Saint Lucia,Senegal, Serbia, South Africa, Sri Lanka, Suriname, Taiwan,Tajikistan, Togo, Tunisia, Turkey, Ukraine, United ArabEmirates, Uruguay, Uzbekistan, Venezuela, Vietnam andZambia. Political and economic structures in many of thesecountries may be undergoing significant evolution and rapiddevelopment, and these countries may lack the social, politicaland economic stability characteristics of developed countries.In general, the securities markets of these countries are lessliquid, are especially subject to greater price volatility, havesmaller market capitalizations, have less government regulationand are not subject to as frequent accounting, financial andother reporting requirements as the securities markets of moredeveloped countries as has historically been the case. As aresult, the risks presented by investments in these countries areheightened. These countries also have problems with securitiesregistration and custody. Additionally, settlement procedures inemerging and frontier market countries are frequently lessdeveloped and reliable than those in the United States, and mayinvolve the Fund’s delivery of securities before receipt ofpayment for their sale. Settlement or registration problems maymake it more difficult for a Fund to value its portfolio securitiesand could cause the Fund to miss attractive investmentopportunities, to have a portion of its assets uninvested or toincur losses due to the failure of a counterparty to pay forsecurities the Fund has delivered or the Fund’s inability tocomplete its contractual obligations. A Fund’s purchase andsale of portfolio securities in certain emerging and frontiermarket countries may be constrained by limitations relating todaily changes in the prices of listed securities, periodic tradingor settlement volume and/or limitations on aggregate holdingsof foreign investors. Such limitations may be computed basedon the aggregate trading volume or holdings of a Fund, theInvestment Adviser, their affiliates and their respective clientsand other service providers. A Fund may not be able to sellsecurities in circumstances where price, trading or settlementvolume limitations have been reached. As a result of these andother risks, investments in these countries generally present agreater risk of loss to a Fund.

Investments in some emerging and frontier market countries,such as those located in Asia, may be restricted or controlled. Insome countries, direct investments in securities may be



prohibited and required to be made through investment fundscontrolled by such countries. These limitations may increasetransaction costs and adversely affect a security’s liquidity,price, and the rights of a Fund in connection with the security.

Unanticipated political, economic or social developments mayaffect the value of a Fund’s investments in emerging andfrontier market countries and the availability to the Fund ofadditional investments in these countries. Some of thesecountries may have in the past failed to recognize privateproperty rights and may have at times nationalized orexpropriated the assets of private companies. There have beenoccasional limitations on the movements of funds and otherassets between different countries. The small size andinexperience of the securities markets in certain of suchcountries and the limited volume of trading in securities inthose countries may make a Fund’s investments in suchcountries illiquid and more volatile than investments in Japanor most Western European countries, and a Fund may berequired to establish special custodial or other arrangementsbefore making certain investments in those countries. Theremay be little financial or accounting information available withrespect to issuers located in certain of such countries, and itmay be difficult as a result to assess the value or prospects of aninvestment in such issuers.

Many emerging market countries are subject to rapid currencydevaluations and high inflation and/or economic recession andsignificant debt levels. These economic factors can have amaterial adverse effect on these countries’ economies and theirsecurities markets. Moreover, many emerging marketcountries’ economies are based on only a few industries and/orare heavily dependent on global trade. Therefore, they may benegatively affected by declining commodity prices, factorsaffecting their trading markets and partners, exchange controlsand other trade barriers, currency valuations and otherprotectionist measures.

From time to time, certain of the companies in which a Fundmay invest may operate in, or have dealings with, countriessubject to sanctions or embargoes imposed by the U.S.government and the United Nations and/or countries identifiedby the U.S. government as state sponsors of terrorism. Acompany may suffer damage to its reputation if it is identifiedas a company that operates in, or has dealings with, countriessubject to sanctions or embargoes imposed by the U.S.government and the United Nations and/or countries identifiedby the U.S. government as state sponsors of terrorism. As aninvestor in such companies, a Fund will be indirectly subject tothose risks.

As a result of recent events involving Ukraine and the RussianFederation, the United States and the EU have imposedsanctions on certain Russian individuals and Russian

corporations. Additional broader sanctions may be imposed inthe future. These sanctions, or even the threat of furthersanctions, may result in the decline of the value and liquidity ofRussian securities, a weakening of the ruble or other adverseconsequences to the Russian economy. These sanctions couldalso result in the immediate freeze of Russian securities,impairing the ability of a Fund to buy, sell, receive or deliverthose securities. Sanctions could also result in Russia takingcounter measures or retaliatory actions, which may furtherimpair the value and liquidity of Russian securities. Theseevents could have a negative effect on the performance of aFund that holds such securities.

Many emerging and frontier market countries also imposewithholding or other taxes on foreign investments, which maybe substantial and result in lower Fund returns.

The creditworthiness of firms used by a Fund to effect securitiestransactions in emerging and frontier market countries maynot be as strong as in some developed countries. As a result, aFund could be subject to a greater risk of loss on its securitiestransactions if a firm defaults on its responsibilities. A Fund’sability to manage its foreign currency may be restricted inemerging and frontier market countries. As a result, asignificant portion of a Fund’s currency exposure in thesecountries may not be covered.

Frontier market countries generally have smaller economies orless developed capital markets than traditional emergingmarkets and, as a result, the risks of investing in emergingmarket countries are magnified in frontier market countries.The economies of frontier market countries are less correlatedto global economic cycles than those of their more developedcounterparts and their markets have low trading volumes andthe potential for extreme price volatility and illiquidity. Thisvolatility may be further heightened by the actions of a fewmajor investors. For example, a substantial increase or decreasein cash flows of mutual funds investing in these markets couldsignificantly affect local stock prices and, therefore, the price ofFund shares. These factors make investing in frontier marketcountries significantly riskier than in other countries and anyone of them could cause the price of a Fund’s shares to decline.

FORWARD CURRENCY EXCHANGE CONTRACTS (principalstrategy for the Multi-Manager Emerging Markets DebtOpportunity Fund and Multi-Manager Global ListedInfrastructure Fund). A forward currency exchange contract isan obligation to exchange one currency for another on a futuredate at a specified exchange rate.

INVESTMENT STRATEGY. The Multi-Manager Emerging MarketsDebt Opportunity Fund may enter into forward currencycontracts for hedging purposes and to seek exposure to certaincurrencies. Each of the other Funds may enter into forward



currency exchange contracts for hedging purposes, inanticipation of the purchase of securities and for liquiditymanagement purposes, but not for speculative purposes or toseek to enhance total return, and are not expected to use theseinstruments as a principal investment strategy.

The Funds also may enter into forward currency exchangecontracts to help reduce the risks and volatility caused bychanges in foreign currency exchange rates. Foreign currencyexchange contracts will be used at the discretion of theSub-Advisers, and no Fund is required to hedge its foreigncurrency positions.

SPECIAL RISKS. Forward foreign currency contracts are privatelynegotiated transactions, and can have substantial pricevolatility. As a result, they offer less protection against defaultby the other party than is available for instruments traded onan exchange. In addition, unlike trading in most other types ofinstruments, there is no systematic reporting of last saleinformation with respect to the foreign currencies underlyingcurrency forwards. When used for hedging purposes, they tendto limit any potential gain that may be realized if the value of aFund’s foreign holdings increases because of currencyfluctuations. It may not be possible, however, to hedge againstlong-term currency changes. When used for speculativepurposes, forward currency exchange contracts may result inadditional losses that are not otherwise related to changes in thevalue of the securities held by a Fund. The institutions that dealin forward currency contracts are not required to continue tomake markets in the currencies they trade and these marketscan experience periods of illiquidity. Further, these contractsare subject to the same political and economic risk factorsapplicable to the countries issuing these currencies.

FUTURES CONTRACTS AND RELATED OPTIONS (principalstrategy for the Multi-Manager Emerging Markets DebtOpportunity Fund). A futures contract is a type of derivativeinstrument that obligates the holder to buy or sell a specifiedfinancial instrument or currency in the future at an agreedupon price. For example, a futures contract may obligate aFund, at maturity, to take or make delivery of certain domesticor foreign securities, the cash value of a securities index or astated quantity of a foreign currency. When a Fund purchasesan option on a futures contract, it has the right to assume aposition as a purchaser or seller of a futures contract at aspecified exercise price during the option period. When a Fundsells an option on a futures contract, it becomes obligated topurchase or sell a futures contract if the option is exercised.

INVESTMENT STRATEGY. To the extent consistent with itsinvestment objective and strategies, each Fund may invest infutures contracts and options on futures contracts on domesticor foreign exchanges or boards of trade. The Multi-Manager

Emerging Markets Debt Opportunity Fund may use theseinvestments for hedging purposes and non-hedging purposes inorder to seek exposure to certain countries or currencies. Eachof the other Funds may use these investments for hedgingpurposes, in anticipation of the purchase of securities and forliquidity management purposes but not for speculativepurposes or to seek to enhance total return.

SPECIAL RISKS. Futures contracts and options present thefollowing risks: imperfect correlation between the change inmarket value of a Fund’s securities and the price of futurescontracts and options; the possible inability to close a futurescontract when desired; losses due to unanticipated marketmovements, which potentially are unlimited; and the possibleinability of the Investment Adviser to correctly predict thedirection of securities prices, interest rates, currency exchangerates and other economic factors. Futures markets are highlyvolatile and the use of futures may increase the volatility of aFund’s NAV. As a result of the low margin deposits normallyrequired in futures trading, a relatively small price movementin a futures contract may result in substantial losses to a Fund.Futures contracts and options on futures may be illiquid, andexchanges may limit fluctuations in futures contract pricesduring a single day. Foreign exchanges or boards of tradegenerally do not offer the same protections as U.S. exchanges.

GEOGRAPHIC RISK AND SECTOR RISK. Although the Funds donot concentrate in any one industry or geographic region, eachFund may invest without limitation in a particular market orgeographic sector.

▪ GEOGRAPHIC RISK (principal risk for the Active M EmergingMarkets Equity Fund, Active M International Equity Fund,Multi-Manager Global Listed Infrastructure Fund andMulti-Manager Global Real Estate Fund) is the risk that if aFund invests a significant portion of its total assets incertain issuers within the same geographic region, aneconomic, business or political development affecting thatregion may affect the value of a Fund’s investments morethan if the Fund’s investments were not so concentrated insuch geographic region. Geographic risk may be applicableto the foreign investments held by the Active M EmergingMarkets Equity Fund, Active M International Equity Fund,Multi-Manager Emerging Markets Debt OpportunityFund, Multi-Manager Global Listed Infrastructure Fundand Multi-Manager Global Real Estate Fund.

▪ SECTOR RISK (principal risk for the Active M EmergingMarkets Equity Fund, Active M International Equity Fund,Multi-Manager Global Listed Infrastructure Fund andMulti-Manager Global Real Estate Fund) is the risk thatcompanies in similar businesses may be similarly affectedby particular economic or market events, which may in



certain circumstances, cause the value of securities of allcompanies in a particular sector to decrease.

ILLIQUID OR RESTRICTED INVESTMENTS. An illiquid investmentis defined in Rule 22e-4 under the 1940 Act as an investmentthat a Fund reasonably expects cannot be sold or disposed of incurrent market conditions in 7 calendar days or less without thesale or disposition significantly changing the market value ofthe investment. Illiquid investments include repurchaseagreements and time deposits with notice/termination dates ofmore than seven days, certain variable amount master demandnotes that cannot be called within seven days, certain insurancefunding agreements (see “Insurance Funding Agreements” onpage 72) certain unlisted over-the-counter derivativeinstruments, and securities and other financial instruments thatare not readily marketable, and 144A Securities (definedbelow), and both foreign and domestic securities that are notreadily marketable unless, based upon a review of the relevantmarket, trading and investment-specific considerations, thoseinvestments are determined not to be illiquid.

INVESTMENT STRATEGY. A Fund may invest up to 15% of its netassets in illiquid investments. A domestically traded securitythat is not registered under the Securities Act of 1933, asamended (the “1933 Act”) will not be considered illiquid if theInvestment Adviser or a Sub-Adviser determines that anadequate trading market exists for that security. If otherwiseconsistent with their investment objectives and strategies, theFunds may purchase commercial paper issued pursuant toSection 4(a)(2) of the 1933 Act and securities that are notregistered under the 1933 Act but can be sold to “qualifiedinstitutional buyers” in accordance with Rule 144A under the1933 Act (“Rule 144A Securities”). These securities will not beconsidered illiquid so long as the Investment Adviser orSub-Advisers determine that, under guidelines approved by theTrust’s Board of Trustees, an adequate trading market exists.

SPECIAL RISKS. Because illiquid and restricted investments maybe difficult to sell at an acceptable price, they may be subject togreater volatility and may result in a loss to a Fund. Thepractice of investing in Rule 144A Securities and commercialpaper available to qualified institutional buyers could increasethe level of a Fund’s illiquidity during any period that qualifiedinstitutional buyers become uninterested in purchasing thesesecurities. Investments purchased by a Fund that are liquid atthe time of purchase may subsequently become illiquid due toevents relating to the issuer, market events, economicconditions and/or investor perception. To the extent aninvestment held by a Fund is deemed to be an illiquidinvestment or a less liquid investment, a Fund will be exposedto greater liquidity risk.

INFRASTRUCTURE COMPANIES (principal strategy for the Multi-Manager Global Listed Infrastructure Fund). The Multi-ManagerGlobal Listed Infrastructure Fund considers a company to beengaged in the infrastructure business if it derives at least 50%of its revenues or earnings from, or devotes at least 50% of itsassets to, infrastructure-related activities. The Fund definesinfrastructure as the systems and networks of energy,transportation, utilities, communication and other servicesrequired for the normal function of society. Infrastructurecompanies are involved in, among other things: (1) thegeneration, transmission and distribution of electric energy;(2) the storage, transportation and distribution of naturalresources, such as natural gas, used to produce energy;(3) alternative energy sources; (4) the building, operation andmaintenance of highways, toll roads, tunnels, bridges andparking lots; (5) the building, operation and maintenance ofairports and ports, railroads and mass transit systems;(6) telecommunications, including wireless and cable networks;(7) water treatment and distribution; and (8) other publicservices such as health care and education.

INVESTMENT STRATEGY. Under normal circumstances, theMulti-Manager Global Listed Infrastructure Fund will invest atleast 80% of its assets in securities of infrastructure companiesthat are listed on a domestic or foreign exchange.

SPECIAL RISKS. Investments in infrastructure-related companieshave greater exposure to the potential adverse economic,regulatory, political and other changes affecting such entities.Infrastructure-related companies are subject to a variety offactors that may adversely affect their business or operationsincluding high interest costs in connection with capitalconstruction programs, costs associated with compliance withand changes in environmental and other regulations, difficultyin raising capital in adequate amounts on reasonable terms inperiods of high inflation and unsettled capital markets, theeffects of surplus capacity, increased competition from otherproviders of services in a developing deregulatory environment,uncertainties concerning the availability of fuel at reasonableprices, the effects of energy conservation policies and otherfactors. Additionally, infrastructure-related entities may besubject to regulation by various governmental authorities andmay also be affected by governmental regulation of ratescharged to customers, government budgetary constraints,service interruption due to environmental, operational or othermishaps and the imposition of special tariffs and changes in taxlaws, regulatory policies and accounting standards.

Other factors that may affect the operations of infrastructure-related companies include innovations in technology that couldrender the way in which a company delivers a product orservice obsolete, significant changes to the number of ultimateend-users of a company’s products, increased susceptibility to



terrorist acts or political actions, risks of environmental damagedue to a company’s operations or an accident, and generalchanges in market sentiment towards infrastructure andutilities assets.

INITIAL PUBLIC OFFERINGS (“IPO”) (principal strategy of theMulti-Manager Global Real Estate Fund). An IPO is acompany’s first offering of stock to the public.

INVESTMENT STRATEGY. The Active M Emerging Markets EquityFund, Multi-Manager Global Listed Infrastructure Fund,Multi-Manager Global Real Estate Fund and Active MInternational Equity Fund may also invest in IPOs to amoderate extent.

SPECIAL RISKS. An IPO presents the risk that the market value ofIPO shares will fluctuate considerably due to factors such as theabsence of a prior public market, unseasoned trading, the smallnumber of shares available for trading and limited informationabout the issuer. The purchase of IPO shares may involve hightransaction costs. IPO shares are subject to market risk andliquidity risk. When a Fund’s asset base is small, a significantportion of the Fund’s performance could be attributable toinvestments in IPOs because such investments would have amagnified impact on the Fund. As a Fund’s assets grow, theeffect of the Fund’s investments in IPOs on the Fund’sperformance probably will decline, which could reduce theFund’s performance. Because of the price volatility of IPOshares, a Fund may choose to hold IPO shares for a very shortperiod of time. This may increase the turnover of a portfolioand may lead to increased expenses to the Fund, such ascommissions and transaction costs. By selling IPO shares, theFund may realize taxable gains it subsequently will distribute toshareholders. In addition, the market for IPO shares can bespeculative and/or inactive for extended periods of time. Thereis no assurance that a Fund will be able to obtain allocableportions of IPO shares. The limited number of shares availablefor trading in some IPOs may make it more difficult for a Fundto buy or sell significant amounts of shares without anunfavorable impact on prevailing prices. Investors in IPOshares can be affected by substantial dilution in the value oftheir shares, by sales of additional shares and by concentrationof control in existing management and principal shareholders.The Funds’ investments in IPO shares may include thesecurities of “unseasoned” companies (companies with lessthan three years of continuous operations), which present risksconsiderably greater than common stocks of more establishedcompanies. These companies may have limited operatinghistories and their prospects for profitability may be uncertain.These companies may be involved in new and evolvingbusinesses and may be vulnerable to competition and changesin technology, markets and economic conditions. They may be

more dependent on key managers and third parties and mayhave limited product lines.

INSURANCE FUNDING AGREEMENTS. An insurance fundingagreement (“IFA”) is an agreement that requires a Fund tomake cash contributions to a deposit fund of an insurancecompany’s general account. The insurance company thencredits interest to the Fund for a set time period.

INVESTMENT STRATEGY. The Funds, except for the Multi-Manager Global Listed Infrastructure Fund, Multi-ManagerEmerging Markets Debt Opportunity Fund and Multi-ManagerHigh Yield Opportunity Fund, may invest in IFAs issued byinsurance companies that meet quality and credit standardsestablished by the Investment Adviser or Sub-Advisers.

SPECIAL RISKS. IFAs are not insured by a government agency—they are backed only by the insurance company that issuesthem.

As a result, they are subject to default risk of thenon-governmental issuer. In addition, the transfer of IFAs maybe restricted and an active secondary market in IFAs currentlydoes not exist. This means that it may be difficult or impossibleto sell an IFA at an appropriate price or that these investmentsmay be considered illiquid.

INTEREST RATE SWAPS, CURRENCY SWAPS, TOTAL RATE OF

RETURN SWAPS, CREDIT SWAPS, AND INTEREST RATE FLOORS,

CAPS AND COLLARS (principal strategy for the Multi-ManagerEmerging Markets Debt Opportunity Fund). Interest rate andcurrency swaps are contracts that obligate a Fund and anotherparty to exchange their rights to pay or receive interest orspecified amounts of currency, respectively. Interest rate floorsentitle the purchasers to receive interest payments if a specifiedindex falls below a predetermined interest rate. Interest ratecaps entitle the purchasers to receive interest payments if aspecified index exceeds a predetermined interest rate. Aninterest rate collar is a combination of a cap and a floor thatpreserves a certain return within a predetermined range ofinterest rates. Total rate of return swaps are contracts thatobligate a party to pay or receive interest in exchange for thepayment by the other party of the total return generated by asecurity, a basket of securities, an index or an indexcomponent. Credit swaps are contracts involving the receipt offloating or fixed rate payments in exchange for assumingpotential credit losses of an underlying security. Credit swapsgive one party to a transaction the right to dispose of or acquirean asset (or group of assets) or, in the case of credit defaultswaps, the right to receive or make a payment from the otherparty, upon the occurrence of specific credit events.

INVESTMENT STRATEGY. To the extent consistent with itsinvestment objective and strategies, the Multi-Manager High



Yield Opportunity Fund may enter into swap transactions andtransactions involving interest rate floors, caps and collars forhedging purposes or to seek to increase total return. The Multi-Manager Emerging Markets Debt Opportunity Fund may enterinto swap transactions and transactions involving interest ratefloors, caps and collars for hedging purposes to offset apotential loss in one position by establishing an interest in anopposite position and to gain exposure to certain countries orcurrencies. To the extent consistent with their investmentobjectives and strategies, each of the other Funds may enterinto currency swap transactions for hedging purposes.

SPECIAL RISKS. The use of swaps and interest rate floors, capsand collars is a highly specialized activity that involvesinvestment techniques and risks different from those associatedwith ordinary portfolio securities transactions. Like otherderivative securities, these instruments can be highly volatile. Ifa Sub-Adviser is incorrect in its forecasts of market values,interest rates and currency exchange rates, the investmentperformance of a Fund would be less favorable than it wouldhave been if these instruments were not used. Because theseinstruments normally are illiquid, a Fund may not be able toterminate its obligations when desired. In addition, if a Fund isobligated to pay the return under the terms of a total rate ofreturn swap, Fund losses due to unanticipated marketmovements potentially are unlimited. A Fund also may suffer aloss if the other party to a transaction defaults. Credit defaultswaps involve special risks in addition to those mentionedabove because they are difficult to value, are highly susceptibleto liquidity and credit risk, and generally pay a return to theparty that has paid the premium only in the event of an actualdefault by the issuer of the underlying obligation (as opposed toa credit downgrade or other indication of financial difficulty).

INTERFUND BORROWING AND LENDING. The SEC has grantedan exemption permitting the Funds to participate in aninterfund borrowing and lending program. This interfundborrowing and lending program allows the Funds to borrowmoney from other funds in the Trust and other affiliatedportfolios of Northern Institutional Funds (each a “Portfolio,”and together the “Portfolios”) advised by NTI, and to lendmoney to other funds in the Trust, for temporary or emergencypurposes. The interfund borrowing and lending program iscurrently not operational. The interfund borrowing andlending program is subject to a number of conditions,including, among other things, the requirements that (1) aFund may not borrow or lend money through the programunless it receives a more favorable interest rate than is availablefrom a bank loan rate or investment yield respectively; (2) loanswill be secured on an equal priority basis with at least anequivalent percentage of collateral to loan value as anyoutstanding bank loan that requires collateral; (3) loans willhave a maturity no longer than that of any outstanding bank

loan (and in any event not over seven days); (4) if an event ofdefault occurs under any agreement evidencing an outstandingbank loan to a Fund, the event of default will automatically(without need for action or notice by the lending fund orPortfolio) constitute an immediate event of default under theinterfund lending agreement entitling the lending fund orPortfolio to call the interfund loan (and exercise all rights withrespect to any collateral) and that such call will be made if thebank exercises its right to call its loan under its agreement witha Fund; (5) a Fund may not borrow money if the loan wouldcause its outstanding borrowings from all sources to exceed10% of its net assets at the time of the loan, except that a Fundmay borrow up to 33 1/3% of its total assets through theprogram or from other sources if each interfund loan is securedby the pledge of segregated collateral with a market value of atleast 102% of the outstanding principal value of the loan; (6) aFund may not loan money if the loan would cause its aggregateoutstanding loans through the program to exceed 15% of its netassets at the time of the loan; (7) a Fund’s interfund loans toany one fund shall not exceed 5% of the lending Fund’s netassets; and (8) a Fund’s borrowings through the program willnot exceed the greater of 125% of the Fund’s total net cashredemptions or 102% of the Fund’s sales fails (when the sale ofsecurities “fails,” due to circumstances beyond the Fund’scontrol) for the preceding seven calendar days as measured atthe time of the loan. In addition, a Fund may participate in theinterfund borrowing and lending program only if and to theextent that such participation is consistent with the Fund’sinvestment objective and policies. The Board of Trustees of theTrust is responsible for overseeing the interfund borrowing andlending program. A delay in repayment to a lending Fundcould result in a lost investment opportunity or additionallending costs.

INVESTMENT COMPANIES. Affiliated and unaffiliatedinvestment companies include, but are not limited to, moneymarket funds, index funds, “country funds” (i.e., funds thatinvest primarily in issuers located in a specific foreign countryor region) and ETFs. Other investment companies in which theFunds may invest include other funds for which the InvestmentAdviser or any of its affiliates serve as investment adviser.

INVESTMENT STRATEGY. To the extent consistent with theirinvestment objectives and strategies, the Funds may invest insecurities issued by other affiliated or unaffiliated investmentcompanies. Investments by a Fund in other investmentcompanies, including ETFs, will be subject to the limitations ofthe 1940 Act except as permitted by SEC orders. The Fundsmay rely on SEC orders that permit them to invest in certainETFs beyond the limits contained in the 1940 Act, subject tocertain terms and conditions. Although the Funds do notexpect to do so in the foreseeable future, each Fund isauthorized to invest substantially all of its assets in an open-end



investment company or a series thereof that has substantiallythe same investment objective, strategies and fundamentalrestrictions as the Fund.

SPECIAL RISKS. As a shareholder of another investmentcompany, a Fund would be subject to the same risks as anyother investor in that company. It also would bear aproportionate share of any fees and expenses paid by thatcompany. These expenses would be in addition to themanagement and other fees paid directly by the Fund. A Fund’sinvestment in an ETF involves other considerations. Inparticular, shares of ETFs are listed and traded on securitiesexchanges and in over-the-counter markets, and the purchaseand sale of these shares involve transaction fees andcommissions. In addition, shares of an ETF are issued in“creation units” and are not redeemable individually exceptupon termination of the ETF. To redeem, a Fund mustaccumulate enough shares of an ETF to reconstitute a creationunit. The liquidity of a small holding of an ETF, therefore, willdepend upon the existence of a secondary market. Certain ETFsintend to effect creations and redemptions principally for cash,rather than primarily in-kind because of the nature of the ETFs’investments.

Investments in such ETFs may be less tax efficient thaninvestments in ETFs that effect creations and redemptionsin-kind. Also, even though the market price of an ETF isderived from the securities it owns, such price at any given timemay be at, below or above the ETF’s NAV. The market forcertain securities in which an ETF invests may become illiquidunder adverse market conditions or economic conditionsindependent of any specific adverse changes in the conditionsof a particular issuer. In adverse market conditions, the ETF’smarket price may begin to reflect illiquidity or pricinguncertainty of the ETF’s portfolio securities, which could leadto the ETF’s shares trading at a price that is higher or lowerthan the ETF’s NAV. At times such differences may besignificant.

Certain investment companies are not actively managed andtheir investment advisers may not attempt to take defensivepositions in any market conditions, including decliningmarkets. This could cause a Fund’s performance to be lowerthan if the Fund employed active management with respect tothat portion of the Fund’s portfolio. These investmentcompanies are also subject to “tracking error” risk, which is therisk that the performance of the investment company using anindex-based strategy will differ from the performance of thereference index it seeks to track due to differences in securitiesholdings, operating expenses, transaction costs, cash flows,operational inefficiencies and tax considerations. Certaininvestment companies in which the Funds may invest may havea large percentage of their shares owned by fewer shareholders.

Large redemption activity could result in the affiliated fundincurring additional costs and being forced to sell portfoliosecurities at a loss to meet redemptions. Periods of marketilliquidity may exacerbate this risk for fixed income funds.Should the investment adviser or another financialintermediary change investment strategies or investmentallocations such that fewer assets are invested in an investmentcompany or an investment company is no longer used as aninvestment, the investment company could experience largeredemptions of its shares. See “Large Shareholder Risk.” below.Certain investment companies may be new funds. There can beno assurance that a new investment company will grow to aneconomically viable size, in which case the investment companymay cease operations. In such an event, a Fund may be requiredto liquidate or transfer its investment at an inopportune time.

INVESTMENT GRADE SECURITIES. A security is consideredinvestment grade if, at the time of purchase, it is rated:

▪ BBB or higher by S&P;

▪ Baa3 or higher by Moody’s;

▪ BBB or higher by Fitch; or

▪ BBB or higher by DBRS Morningstar® Ratings Limited(“DBRS”).

A security will be considered investment grade if it receives oneof the above ratings, or a comparable rating from anotherorganization that is recognized as a Nationally RecognizedStatistical Rating Organization (“NRSRO”), even if it receives alower rating from other rating organizations. An unratedsecurity also may be considered investment grade if aSub-Adviser determines that the security is comparable inquality to a security that has been rated investment grade.

INVESTMENT STRATEGY. The Funds may invest in fixed-incomeand convertible securities to the extent consistent with theirinvestment objectives and strategies. Except as stated in thesection entitled “Non-Investment Grade Securities,” fixed-income and convertible securities purchased by the Funds,except for the Multi-Manager Emerging Markets DebtOpportunity Fund and Multi-Manager High Yield OpportunityFund, generally will be investment grade.

SPECIAL RISKS. Although securities rated BBB by S&P, DBRS orFitch, or Baa3 by Moody’s are considered investment grade,they have certain speculative characteristics. Therefore, theymay be subject to a higher risk of default than obligations withhigher ratings. Subsequent to its purchase by a Fund, a ratedsecurity may cease to be rated or its rating may be reducedbelow the minimum rating required for purchase by the Fundand may be in default. The Sub-Advisers will consider such anevent in determining whether the Fund should continue tohold the security.



LARGE CAP STOCK RISK (principal risk of the Active MInternational Equity Fund, and Multi-Manager Global ListedInfrastructure Fund). Larger, more established companies maybe unable to respond quickly to new competitive challengessuch as changes in technology and consumer tastes. Manylarger companies also may not be able to attain the high growthrate of successful smaller companies, especially during extendedperiods of economic expansion. For purposes of a Fund’sinvestment policies, the market capitalization of a company isbased on its capitalization at the time the Fund purchases thecompany’s securities. Market capitalizations of companieschange over time. A Fund is not obligated to sell a company’ssecurity simply because, subsequent to its purchase, thecompany’s market capitalization has changed to be outside thecapitalization range, if any, in effect for the Fund.

LARGE SHAREHOLDER RISK (principal risk for all Funds). To theextent a significant percentage of the shares of a Fund areowned or controlled by a small number of accountshareholders (or a single account shareholder), including fundsor accounts over which the Investment Adviser or an affiliate ofthe Investment Adviser has investment discretion, the Fund issubject to the risk that those shareholders may purchase orredeem Fund shares in significant amounts rapidly orunexpectedly, including as a result of an asset allocationdecision made by the Investment Adviser or an affiliate of theInvestment Adviser and may adversely affect a Fund’sperformance if the Investment Adviser is forced to sell portfoliosecurities or invest cash when the Investment Adviser wouldnot otherwise choose to do so. Redemptions of a large numberof shares may affect the liquidity of a Fund’s portfolio, increasethe Fund’s transaction costs, and accelerate the realization oftaxable income and/or gains. In addition, a large redemptioncould result in each Fund’s current expenses being allocatedover a smaller asset base, leading to an increase in each suchFund’s expense ratio. Large purchases of a Fund’s shares mayalso adversely affect the Fund’s performance to the extent that aFund is delayed in investing new cash or otherwise maintains alarger cash position than it ordinarily would.

LENDING OF SECURITIES. In order to generate additionalincome, the Funds may lend securities to banks, brokers anddealers or other qualified institutions. In exchange, the Fundswill receive collateral equal to at least 100% of the value of thesecurities loaned.

INVESTMENT STRATEGY. Securities lending may represent nomore than one-third of the value of a Fund’s total assets(including the loan collateral). Any cash collateral received by aFund in connection with these loans may be invested in avariety of short-term investments, either directly or indirectlythrough money market portfolios. Loan collateral (includingany investment of the collateral) is not included in the

calculation of the percentage limitations described elsewhere inthis Prospectus regarding each Fund’s investments in particulartypes of securities. The securities lending program is notcurrently operational.

SPECIAL RISKS. A principal risk when lending portfolio securitiesis that the borrower might become insolvent or refuse to honorits obligation to return the securities. In this event, a Fundcould experience delays in recovering its securities and possiblymay incur a capital loss. Upon return of the loaned securities,the Fund would be required to return the related cash collateralto the borrower and may be required to liquidate portfoliosecurities in order to do so. To the extent that the portfoliosecurities acquired with such collateral have decreased in value,it may result in the Fund realizing a loss at a time when itwould not otherwise do so. As such, securities lending mayintroduce leverage into the Fund. Additionally, the amount of aFund’s distributions that qualify for taxation at reduced long-term capital gains rates for individuals, as well as the amount ofa Fund’s distributions that qualify for the dividends receiveddeduction available to corporate shareholders (together,“qualifying dividends”), may be reduced as a result of a Fund’ssecurities lending activities. This is because any dividends paidon securities while on loan will not be deemed to have beenreceived by a Fund, and the equivalent amount paid to a Fundby the borrower of the securities will not be deemed to be aqualifying dividend.

LIBOR TRANSITION. Certain Fund’s investments, paymentobligations and financing terms may be based on floating rates,such as London Interbank Offered Rate (“LIBOR”), EuroInterbank Offered Rate and other similar types of referencerates (each, a “Reference Rate”). On July 27, 2017, the ChiefExecutive of the UK Financial Conduct Authority (“FCA”),which regulates LIBOR, announced that the FCA will no longerpersuade nor compel banks to submit rates for the calculationof LIBOR and certain other Reference Rates after 2021. Suchannouncement indicates that the continuation of LIBOR andother Reference Rates on the current basis cannot and will notbe guaranteed after 2021. The transition away from ReferenceRates may lead to increased volatility and illiquidity in marketsthat are tied to such Reference Rates and reduced values ofReference Rate-related investments. This announcement andany additional regulatory or market changes that occur as aresult of the transition away from Reference Rates may have anadverse impact on a Fund’s investments, performance orfinancial condition.

LIQUIDITY RISK (principal risk for the Multi-Manager EmergingMarkets Debt Opportunity Fund, Multi-Manager Global ListedInfrastructure Fund and Multi-Manager High Yield OpportunityFund) is the risk that a Fund will not be able to pay redemptionproceeds within the time periods described in this Prospectus



because of unusual market conditions, an unusually highvolume of redemption requests, legal restrictions impairingtheir ability to sell particular securities or close derivativepositions at an advantageous market price or other reasons.Certain portfolio securities may be less liquid than others,which may make them difficult or impossible to sell at the timeand the price that a Fund would like or difficult to value. AFund may have to lower the price, sell other securities insteador forgo an investment opportunity. In addition, certain assetsthat a Fund wants to buy may be difficult or impossible topurchase. Any of these events could have a negative effect onportfolio management or performance. Liquidity risk may bethe result of, among other things, the reduced number andcapacity of traditional market participants to make a market forcertain securities. As a general matter, dealers recently havebeen less willing to make markets for certain fixed incomesecurities. The potential for liquidity risk may be magnified by arising interest rate environment or other circumstances whereinvestor redemptions from money market and other fixedincome mutual funds may be higher than normal, potentiallycausing increased supply in the market due to selling activity.Funds with principal investment strategies that involveinvestments in securities of companies with smaller marketcapitalizations, foreign securities, derivatives or securities withpotential market and/or credit risk tend to have the greatestexposure to liquidity risk. All of these risks may increase duringperiods of market volatility. The liquidity of certain assets, suchas privately issued and non-investment grade mortgage- andasset-backed securities, may be difficult to ascertain and maychange over time. Transactions in less liquid securities mayentail transaction costs that are higher than those fortransactions in more liquid securities.

LOAN PARTICIPATIONS (principal strategy for the Multi-Manager High Yield Opportunity Fund). A loan participation isan interest in a loan to a U.S. or foreign company or otherborrower, which is administered and sold by a financialintermediary.

INVESTMENT STRATEGY. The Multi-Manager High YieldOpportunity Fund may invest in loan participations in theform of a direct or co-lending relationship with the corporateborrower, an assignment of an interest in the loan by aco-lender or another participant, or a participation in a seller’sshare of the loan.

SPECIAL RISKS. Like other debt obligations, loan participationsmay be subject to credit risk if the borrower defaults on makinginterest payments and repaying the principal. In the case wherethe Multi-Manager High Yield Opportunity Fund purchases aloan assignment or participation from another lender, the Fundalso is subject to delays, expenses and risks greater than wouldhave been involved if the Fund had purchased a direct

obligation of the borrower. The Fund’s investments in loanparticipations and assignments are also subject to the risk thatthe financial institution acting as agent for all interests in a loanmight fail financially. It is also possible that the Fund could beheld liable as a co-lender.

LOAN RISK (principal risk for the Multi-Manager High YieldOpportunity Fund). The primary risk in an investment in loansis that borrowers may be unable to meet their interest and/orprincipal payment obligations. Loans may be unrated, lessliquid and more difficult to value than traditional debtsecurities. Loans may be made to finance highly leveragedcorporate operations or acquisitions. The highly leveragedcapital structure of the borrowers in such transactions maymake such loans especially vulnerable to adverse changes infinancial, economic or market conditions. Loans in which aFund may invest may be either collateralized or uncollateralizedand senior or subordinate. Investments in uncollateralized and/or subordinate loans entail a greater risk of nonpayment thando investments in loans that hold a more senior position in theborrower’s capital structure and/or are secured with collateral.Loans generally are subject to restrictions on transfer, and onlylimited opportunities may exist to sell such loans in secondarymarkets. As a result, a Fund may be unable to sell loans at adesired time or price. If the Fund acquires only an assignmentor a participation in a loan made by a third party, the Fundmay not be able to control amendments, waivers or the exerciseof any remedies that a lender would have under a direct loanand may assume liability as a lender. Transactions in loans maysettle on a delayed basis. As a result, the proceeds from the saleof a loan may not be available to make additional investmentsor to meet a Fund’s redemption obligations. Bank loans maynot be considered securities and the Fund may therefore nothave the protections afforded by U.S. federal securities lawswith respect to such investments.

MARKET EVENTS RISK relates to the increased volatility,depressed valuations, decreased liquidity and heighteneduncertainty in the financial markets throughout the worldduring the past decade. These conditions may recur.

The U.S. government and the Federal Reserve, as well as certainforeign governments and central banks, have taken steps tosupport financial markets, including by keeping interest rates athistorically low levels. This and other government interventionmay not work as intended, particularly if the efforts areperceived by investors as being unlikely to achieve the desiredresults. In recent years, the U.S. government and FederalReserve have reduced their market support activities and havebegun raising interest rates. Certain foreign governments andcentral banks have implemented so-called negative interestrates (e.g., charging depositors who keep their cash at a bank)to spur economic growth. Governmental or central bank



actions, including interest rate increases, measures to addressbudget deficits, or contrary actions by different governments, aswell as downgrades of sovereign debt, fluctuations in oil andcommodity prices, dramatic changes in currency exchange ratesand geopolitical events (including war and terror attacks) couldnegatively affect financial markets generally, increase marketvolatility and reduce the value and liquidity of securities inwhich a Fund invests.

Policy and legislative changes in the United States and in othercountries (such as the UK referendum vote to exit the EU, asfurther discussed below) may also contribute to decreasedliquidity and increased volatility in the financial markets.Political turmoil within the U.S. and abroad may also impactthe Funds. Although the U.S. government has honored itscredit obligations, it remains possible that the U.S. coulddefault on its obligations. While it is impossible to predict theconsequences of such an unprecedented event, it is likely that adefault by the U.S. would be highly disruptive to the U.S. andglobal securities markets and could significantly impair thevalue of the Funds’ investments. Similarly, political eventswithin the United States at times have resulted, and may in thefuture result, in a shutdown of government services, whichcould negatively affect the U.S. economy, decrease the value ofmany Fund investments, and increase uncertainty in or impairthe operation of the U.S. or other securities markets.

Economies and financial markets throughout the world areincreasingly interconnected. Economic, financial or politicalevents, trading and tariff arrangements, terrorism, naturaldisasters, public health emergencies (including pandemics andepidemics) and other circumstances in one country or regioncould have profound impacts on global economies or markets.As a result, whether or not a Fund directly invests in securitiesof issuers located in or with significant exposure to thecountries directly affected, the value and liquidity of a Fund’sinvestments may be negatively affected.

In June 2016, voters in the UK approved a referendum to leavethe EU. The UK gave notice in March 2017 of its withdrawalfrom the EU and commenced negotiations on the terms ofwithdrawal. An agreement was reached, and the UK left the EUon January 31, 2020, with a transition period during which theparties will negotiate their future relationship currently set toend on December 31, 2020. There is significant marketuncertainty regarding Brexit’s ramifications, and the range andpotential implications of possible political, regulatory,economic, and market outcomes are difficult to predict.Political events, including nationalist unrest in Europe anduncertainties surrounding the sovereign debt of a number ofEU countries and the viability of the EU itself, also may causemarket disruptions. If one or more countries leave the EU orthe EU dissolves, the world’s securities markets likely will be

significantly disrupted. Moreover, the uncertainty about theramifications of Brexit may cause significant volatility and/ordeclines in the value of the Euro and British pound. Brexit (andin particular a hard Brexit, i.e. an exit in which the UK leavesnot only the EU, but also the EU single market and the EUcustoms union, and without agreements on trade, finance andother key elements) may cause significant market volatility andilliquidity, currency fluctuations, deterioration in economicactivity, a decrease in business confidence, and increasedlikelihood of a recession in the UK. This may increaseredemptions from Funds that hold impacted securities, orcause the value of a Fund’s securities that are economically tiedto the UK or EU to decline. Additionally, it is possible thatmeasures could be taken to revote on the issue of Brexit, or thatportions of the UK could seek to separate and remain a part ofthe EU. Market factors, such as the demand for particularportfolio securities, may cause the price of certain portfoliosecurities to fall while the price of other securities rise orremain unchanged.

RECENT MARKET EVENTS. Periods of unusually high financialmarket volatility and restrictive credit conditions, at timeslimited to a particular sector or geographic area, have occurredin the past and may be expected to recur in the future. Somecountries, including the United States, have adopted or havesignaled protectionist trade measures, relaxation of thefinancial industry regulations that followed the financial crisis,and/or reductions to corporate taxes. The scope of these policychanges is still developing, but the equity and debt markets mayreact strongly to expectations of change, which could increasevolatility, particularly if a resulting policy runs counter to themarket’s expectations. The outcome of such changes cannot beforeseen at the present time. In addition, geopolitical and otherrisks, including environmental and public health risks, may addto instability in the world economy and markets generally. As aresult of increasingly interconnected global economies andfinancial markets, the value and liquidity of a Fund’sinvestments may be negatively affected by events impacting acountry or region, regardless of whether the Fund invests inissuers located in or with significant exposure to such countryor region.

Recent events are impacting the securities markets. A recentoutbreak of respiratory disease caused by a novel coronaviruswas first detected in December 2019 and has spreadinternationally. The outbreak and efforts to contain its spreadhave resulted in closing borders and quarantines, restrictinginternational and domestic travel, enhanced health screenings,cancellations, disrupted supply chains and customer activity,responses by businesses (including changes to operations andreducing staff), and have produced general concern anduncertainty. The impact of the coronavirus pandemic, andother epidemics and pandemics that may arise in the future,



could adversely affect national and global economies,individual companies and the market in general in a mannerand for a period of time that cannot be foreseen at the presenttime. Health crises caused by the recent outbreak may heightenother preexisting political, social and economic risks in acountry or region. Governmental authorities and regulatorsthroughout the world, such as the U.S. Federal Reserve, have inthe past responded to major economic disruptions withchanges to fiscal and monetary policy, including but not limitedto, direct capital infusions, new monetary programs, anddramatically lower interest rates. Certain of those policychanges are being implemented or considered in response tothe coronavirus outbreak. Such policy changes may adverselyaffect the value, volatility and liquidity of dividend and interestpaying securities. In certain cases, an exchange or market mayclose or issue trading halts on either specific securities or eventhe entire market, which may result in a Fund being, amongother things, unable to buy or sell certain securities or financialinstruments or to accurately price its investments. In the eventof a pandemic or an outbreak, there can be no assurance thatthe Funds and their service providers will be able to maintainnormal business operations for an extended period of time orwill not lose the services of key personnel on a temporary orlong-term basis due to illness or other reasons. A pandemic ordisease could also impair the information technology and otheroperational systems upon which a Fund’s investment adviser(or sub-adviser) rely, and could otherwise disrupt the ability ofthe Funds’ service providers to perform essential tasks.Although multiple asset classes may be affected by a marketdisruption, the duration and effects may not be the same for alltypes of assets. To the extent a Fund may overweight itsinvestments in certain countries, companies, industries ormarket sectors, such position will increase the Fund’s exposureto risk of loss from adverse developments affecting thosecountries, companies, industries or sectors. These conditionscould result in a Fund’s inability to achieve its investmentobjectives, cause the postponement of reconstitution orrebalance dates for benchmark indices, adversely affect theprices and liquidity of the securities and other instruments inwhich a Fund invests, negatively impact a Fund’s performance,and cause losses on your investment in a Fund. You should alsoreview this prospectus and the SAI to understand each Fund’sdiscretion to implement temporary defensive measures, as wellas the circumstances in which a Fund may satisfy redemptionrequests in-kind.

MASTER LIMITED PARTNERSHIPS (principal strategy for theMulti-Manager Global Listed Infrastructure Fund). An MLP is apublicly traded company organized as a limited partnership orlimited liability company and treated as a partnership forfederal income tax purposes. MLPs may derive income andgains from the exploration, development, mining or

production, processing, refining, transportation (includingpipelines transporting gas, oil, or products thereof), or themarketing of any mineral or natural resources. MLPs generallyhave two classes of owners, the general partner and limitedpartners. The general partner of an MLP is typically owned byone or more of the following: a major energy company, aninvestment fund, or the direct management of the MLP. Thegeneral partner may be structured as a private or publiclytraded corporation or other entity. The general partnertypically controls the operations and management of the MLPthrough an up to 2% equity interest in the MLP plus, in manycases, ownership of common units and subordinated units.Limited partners own the remainder of the partnership,through ownership of common units, and have a limited role inthe partnership’s operations and management.

INVESTMENT STRATEGY. The Multi-Manager Global ListedInfrastructure Fund may invest up to 25% of its net assets inenergy-related companies organized as MLPs and theiraffiliates. The other Funds may also invest in MLPs to theextent consistent with their investment objectives andstrategies.

SPECIAL RISKS. As compared to common stockholders of acorporation, holders of MLP units have more limited controland limited rights to vote on matters affecting the partnershipand the potential for a conflict of interest exists betweencommon unit holders and an MLP’s limited partners. Inaddition, there are certain tax risks associated with aninvestment in MLP units and conflicts of interest may existbetween common unit holders and the general partner,including those arising from incentive distribution payments.MLPs may also be sensitive to changes in interest rates andduring periods of interest rate volatility, may not provideattractive returns.

A change in current tax law, or a change in the business of agiven MLP, could result in an MLP being treated as acorporation for U.S. federal income tax purposes, which wouldresult in such MLP being required to pay U.S. federal incometax on its taxable income. Thus, if any of the MLPs owned bythe Multi-Manager Global Listed Infrastructure Fund weretreated as corporations for U.S. federal income tax purposes,the after-tax return to the Fund with respect to its investmentin such MLPs would be materially reduced, which could cause adecline in the value of the common stock.

To the extent that the Multi-Manager Global ListedInfrastructure Fund invests in the equity securities of an MLP,the Fund will be a limited partner or member in such MLP.Accordingly, the Fund will be required to include in its taxableincome the Fund’s allocable share of the income, gains, losses,deductions and expenses recognized by each such MLP,regardless of whether the MLP distributes cash to the Fund.



The Fund may have to sell investments to provide cash to makerequired distributions if its allocable share of an MLP’s incomeand gains is not offset by the MLP’s tax deductions, losses andcredits and the MLP does not distribute sufficient cash. Theportion, if any, of a distribution received by the Fund from anMLP that is offset by the MLP’s tax deductions, losses or creditsis essentially treated as a return of capital. The percentage of anMLP’s income and gains that is offset by tax deductions, lossesand credits will fluctuate over time for various reasons. Asignificant slowdown in acquisition activity or capital spendingby MLPs held in the Fund’s portfolio could result in areduction of depreciation deductions, which may result inincreased current taxable income for the Fund.

Because of the Multi-Manager Global Listed InfrastructureFund’s investments in equity securities of MLPs, the Fund’searnings and profits may be calculated using accountingmethods that are different from those used for calculatingtaxable income. Because of these differences, the Fund maymake distributions out of its current or accumulated earningsand profits, which will be treated as taxable dividends, even inyears in which the Fund’s distributions exceed its taxableincome. In addition, changes in tax laws or regulations, orfuture interpretations of such laws or regulations, couldadversely affect the Fund or the MLP investments in which theFund invests.

MORTGAGE DOLLAR ROLLS. A mortgage dollar roll involves thesale by a Fund of securities for delivery in the future (generallywithin 30 days). The Fund simultaneously contracts with thesame counterparty to repurchase substantially similar (sametype, coupon and maturity) but not identical securities on aspecified future date. During the roll period, the Fund loses theright to receive principal and interest paid on the securitiessold. However, the Fund benefits to the extent of any differencebetween (a) the price received for the securities sold and (b) thelower forward price for the future purchase and/or fee incomeplus the interest earned on the cash proceeds of the securitiessold.

INVESTMENT STRATEGY. The Multi-Manager High YieldOpportunity Fund may enter into mortgage dollar rolls in aneffort to enhance investment performance. For financialreporting and tax purposes, the Fund treats mortgage dollarrolls as two separate transactions: one involving the purchase ofa security and a separate transaction involving a sale. The Fundcurrently does not intend to enter into mortgage dollar rollsthat are accounted for as financings and do not treat them asborrowings.

SPECIAL RISKS. Successful use of mortgage dollar rolls dependsupon the Sub-Adviser’s ability to predict correctly interest ratesand mortgage prepayments. If the Sub-Adviser is incorrect inits prediction, the Multi-Manager High Yield Opportunity

Fund may experience a loss. Unless the benefits of a mortgagedollar roll exceed the income, capital appreciation and gain orloss due to mortgage prepayments that would have beenrealized on the securities sold as part of the roll, the use of thistechnique will diminish the Fund’s performance.

NON-INVESTMENT GRADE SECURITIES (principal strategy for theMulti-Manager Emerging Markets Debt Opportunity Fund andMulti-Manager High Yield Opportunity Fund). Non-investmentgrade fixed-income and convertible securities (sometimesreferred to as “junk bonds”) generally are rated BB or below byS&P, DBRS or Fitch, or Ba or below by Moody’s (or havereceived a comparable rating from another NRSRO), or, ifunrated, are determined to be of comparable quality by theSub-Advisers.

INVESTMENT STRATEGY. The Multi-Manager Emerging MarketsDebt Opportunity Fund and Multi-Manager High YieldOpportunity Fund each may invest without limitation innon-investment grade securities, including convertiblesecurities, as part of its principal investment strategy. Each ofthe other Funds may invest up to 15% of their total assets,measured at the time of purchase, in non-investment gradefixed-income and convertible securities, when the Sub-Advisersdetermine that such securities are desirable in light of theFunds’ investment objectives and portfolio mix.

SPECIAL RISKS. Non-investment grade fixed-income andconvertible securities are considered predominantly speculativeby traditional investment standards. The market value of theselow-rated securities tends to be more sensitive to individualcorporate developments and changes in interest rates andeconomic conditions than higher-rated securities. In addition,they generally present a higher degree of credit risk. Issuers oflow-rated securities are often highly leveraged, so their abilityto repay their debt during an economic downturn or periods ofrising interest rates may be impaired. The risk of loss due todefault by these issuers also is greater because low-ratedsecurities generally are unsecured and often are subordinated tothe rights of other creditors of the issuers of such securities.

Investment by a Fund in defaulted securities poses additionalrisk of loss should nonpayment of principal and interestcontinue in respect of such securities. Even if such securities areheld to maturity, recovery by a Fund of its initial investmentand any anticipated income or appreciation will be uncertain. AFund also may incur additional expenses in seeking recovery ondefaulted securities.

The secondary market for lower quality securities isconcentrated in relatively few market makers and is dominatedby institutional investors. Accordingly, the secondary marketfor such securities is not as liquid as, and is more volatile than,the secondary market for higher quality securities. In addition,



market trading volume for these securities generally is lowerand the secondary market for such securities could contractunder adverse market or economic conditions, independent ofany specific adverse changes in the condition of a particularissuer. These factors may have an adverse effect on the marketprice and a Fund’s ability to dispose of particular portfolioinvestments. A less developed secondary market also may makeit more difficult for a Fund to obtain precise valuations of suchsecurities in its portfolio.

Investments in lower quality securities, whether rated orunrated, will be more dependent on the Investment Adviser’scredit analysis than would be the case with investments inhigher quality securities.

OPERATIONAL RISK. The Investment Adviser and Sub-Advisersto the Funds and other Fund service providers may be subjectto operational risk and may experience disruptions andoperating errors. In particular, these errors or failures insystems and technology, including operational risks associatedwith reliance on third-party service providers, may adverselyaffect a Fund’s ability to calculate its NAVs in a timely manner,including over a potentially extended period. While serviceproviders are required to have appropriate operational riskmanagement policies and procedures in place, their methods ofoperational risk management may differ from those of theFunds in the setting of priorities, the personnel and resourcesavailable or the effectiveness of relevant controls. TheInvestment Adviser, through its monitoring and oversight ofservice providers, seeks to ensure that service providers takeappropriate precautions to avoid and mitigate risks that couldlead to disruptions and operating errors. However, it is notpossible for the Investment Adviser, the Sub-Advisers or otherFund service providers to identify all of the operational risksthat may affect a Fund or to develop processes and controls tocompletely eliminate or mitigate their occurrence or effects.

OPTIONS. An option is a type of derivative instrument thatgives the holder the right (but not the obligation) to buy (a“call”) or sell (a “put”) an asset in the future at an agreed uponprice prior to the expiration date of the option.

INVESTMENT STRATEGY. The Multi-Manager Emerging MarketsDebt Opportunity Fund may write (sell) covered call options,buy put options, buy call options and write secured put optionsfor hedging (or cross hedging) purposes or to gain exposure tocertain countries or currencies.

To the extent consistent with its investment objective andstrategies, each of the other Funds may write (sell) covered calloptions, buy put options, buy call options and write securedput options for hedging (or cross-hedging) purposes, inanticipation of the purchase of securities and for liquiditymanagement purposes but not for speculative purposes or toseek to enhance total return.

Options may relate to particular securities, foreign or domesticsecurities indices, financial instruments or foreign currencies. AFund will not purchase put and call options in an amount thatexceeds 5% of its net assets at the time of purchase. The totalvalue of a Fund’s assets subject to options written by the Fundwill not be greater than 25% of its net assets at the time theoption is written. A Fund may “cover” a call option by owningthe security underlying the option or through other means. Putoptions written by a Fund are “secured” if the Fund maintainsliquid assets in a segregated account in an amount at least equalto the exercise price of the option up until the expiration date.

SPECIAL RISKS. Options trading is a highly specialized activitythat involves investment techniques and risks different fromthose associated with ordinary Fund securities transactions. Thevalue of options can be highly volatile, and their use can resultin loss if the Investment Adviser or Sub-Advisers are incorrectin their expectation of price fluctuations. The successful use ofoptions for hedging purposes also depends in part on the abilityof the Investment Adviser or Sub-Advisers to predict futureprice fluctuations and the degree of correlation between theoptions and securities markets.

Each Fund will invest and trade in unlisted over-the-counteroptions only with firms deemed creditworthy by theInvestment Adviser or Sub-Advisers. However, unlisted optionsare not subject to the protections afforded purchasers of listedoptions by the Options Clearing Corporation, which performsthe obligations of its members that fail to perform them inconnection with the purchase or sale of options. Therefore, aFund bears the risk that the counterparty that wrote the optionwill be unable or unwilling to perform its obligations under theoption contract.

PORTFOLIO TURNOVER RISK (principal risk for the Multi-Manager Emerging Markets Debt Opportunity Fund and Multi-Manager Global Real Estate Fund). The portfolio turnover ratesfor the Funds are likely to be higher than the rates forcomparable mutual funds with a single portfolio manager. Eachof the Funds’ Sub-Advisers makes decisions to buy or sellsecurities independently from other Sub-Advisers. Thus, oneSub-Adviser for a Fund may be selling a security when anotherSub-Adviser for the Fund, or a Sub-Adviser for another Fund,is purchasing that same security. Additionally, when a Fundreplaces a Sub-Adviser, the new Sub-Adviser may restructurethe investment portfolio, which may increase the Fund’sportfolio turnover rate. The Sub-Advisers will not consider theportfolio turnover rate a limiting factor in making investmentdecisions for certain Funds. A high portfolio turnover rate(100% or more) is likely to involve higher brokeragecommissions and other transaction costs, which could reduce aFund’s return. It also may result in higher short-term capitalgains that are taxable to shareholders when distributed.



Distributions may be derived primarily from short-term capitalgains that are taxable as ordinary income. Short-term capitalgains and losses realized by a Fund are not eligible to offset ashareholder’s short-term capital losses or gains, respectively,earned from other investments. See “Financial Highlights” forthe Funds’ historical portfolio turnover rates.

PREFERRED STOCK (principal strategy for the Multi-ManagerHigh Yield Opportunity Fund). Preferred stocks are securitiesthat represent an ownership interest providing the holder withclaims on the issuer’s earnings and assets before common stockowners but after bond owners.

INVESTMENT STRATEGY. The Multi-Manager High YieldOpportunity Fund may invest in preferred stocks as part of itsprincipal investment strategy. Each of the other Funds may alsoinvest in preferred stocks to the extent consistent with itsinvestment objectives and strategies.

SPECIAL RISKS. Unlike most debt securities, the obligations of anissuer of preferred stock, including dividend and other paymentobligations, typically may not be accelerated by the holders ofsuch preferred stock on the occurrence of an event of default orother non-compliance by the issuer of the preferred stock.Preferred stock is sensitive to changes in an issuer’screditworthiness and changes to interest rates, and may declinein value as interest rates rise.

PREPAYMENT (OR CALL) RISK (principal risk for the Multi-Manger High Yield Opportunity Fund) is the risk that an issuercould exercise its right to pay principal on an obligation held bythe Fund (such as an asset-backed security) earlier thanexpected. The exercise of such right may result in a decreasedrate of return and a decline in value of those obligations and,accordingly, a decline in the Fund’s net asset value. Issuers maybe more likely to prepay when interest rates fall, when creditspreads change, or when an issuer’s credit quality improves. Ifthis happens, the Fund may be unable to recoup all of its initialinvestment, will not benefit from the rise in the market price ofthe securities that normally accompanies a decline in interestrates, and will also suffer from having to reinvest in loweryielding securities. The Fund may also lose any premium it paidto purchase the securities.

REAL ESTATE INVESTMENT TRUSTS (principal strategy for theMulti-Manager Global Real Estate Fund). REITs are pooledinvestment vehicles that invest primarily in either real estate orreal estate related loans.

INVESTMENT STRATEGY. The Multi-Manager Global Real EstateFund invests a substantial amount of its assets in REITs. Theother Funds also may invest in REITs to the extent consistentwith their investment objectives and strategies.

SPECIAL RISKS. The value of a REIT is affected by changes in thevalue of the properties owned by the REIT or securing

mortgage loans held by the REIT. REITs are dependent uponcash flow from their investments to repay financing costs andthe ability of a REIT’s manager. REITs also are subject to risksgenerally associated with investments in real estate. These risksinclude: changes in the value of real estate properties anddifficulties in valuing and trading real estate; risks related togeneral and local economic conditions; overbuilding andincreased competition; increases in property taxes andoperating expenses; changes in zoning laws; casualty andcondemnation losses; variations in rental income; changes inthe appeal of property to tenants; tenant bankruptcies andother credit problems; and changes in interest rates. To theextent that assets underlying a REIT are concentratedgeographically, by property type or in certain other respects,these risks may be heightened. A Fund will indirectly bear itsproportionate share of any expenses, including managementfees, paid by a REIT in which it invests.

REITs are subject to a highly technical and complex set ofprovisions in the Code. It is possible that a Fund may invest in areal estate company that purports to be a REIT and that thecompany could fail to qualify as a REIT. In the event of anysuch unexpected failure to qualify as a REIT, the companywould be subject to corporate-level taxation, significantlyreducing the return to a Fund on its investment in suchcompany. REITs could possibly fail to qualify for tax free pass-through of income under the Code, or to maintain theirexemptions from registration under the 1940 Act. The abovefactors may also adversely affect a borrower’s or a lessee’s abilityto meet its obligations to the REIT. In the event of a default bya borrower or lessee, the REIT may experience delays inenforcing its rights as a mortgagee or lessor and may incursubstantial costs associated with protecting its investments.

In addition, the value of such securities may fluctuate inresponse to the market’s perception of the creditworthiness ofthe issuers of mortgage-related securities owned by a Fund.Because investments in mortgage-related securities are interestsensitive, the ability of the issuer to reinvest or to reinvestfavorably in underlying mortgages may be limited bygovernment regulation or tax policy. For example, action by theBoard of Governors of the Federal Reserve System to limit thegrowth of the nation’s money supply may cause interest rates torise and thereby reduce the volume of new residentialmortgages. Additionally, although mortgages and mortgage-related securities are generally supported by some form ofgovernment or private guarantees and/or insurance, there is noassurance that private guarantors or insurers will be able tomeet their obligation.

REITs (especially mortgage REITs) are also subject to interestrate risks. When interest rates decline, the value of a REIT’sinvestment in fixed rate obligations can be expected to rise.



Conversely, when interest rates rise, the value of a REIT’sinvestment in fixed rate obligations can be expected to decline.In contrast, as interest rates on adjustable rate mortgage loansare reset periodically, yields on a REIT’s investments in suchloans will gradually align themselves to reflect changes inmarket interest rates, causing the value of such investments tofluctuate less dramatically in response to interest ratefluctuations than would investments in fixed rate obligations.

The REIT investments of a Fund often do not provide completetax information to the Fund until after the calendar year-end.Consequently, because of the delay, it may be necessary for theFund to request permission to extend the deadline for issuanceof Forms 1099-DIV beyond January 31. Also, under currentprovisions of the Code, distributions attributable to operatingincome of REITs in which the Fund invests are not eligible forfavorable tax treatment as long-term capital gains and will betaxable to shareholders as ordinary income.

In addition, under recent tax legislation, individuals and certainother noncorporate entities are generally eligible for a 20%deduction with respect to taxable ordinary dividends fromREITs. To the extent a Fund designates dividends it pays to itsshareholders as “section 199A dividends,” shareholders may beeligible for the 20% deduction with respect to such dividends.The amount of section 199A dividends that a Fund may payand report to shareholders is limited to the excess of theordinary REIT dividends, other than capital gain dividends andportions of REIT dividends designated as qualified dividendincome, that such Fund receives from REITs for a taxable yearover such Fund’s expenses allocable to such dividends.

REAL ESTATE SECURITIES (principal risk for the Multi-ManagerGlobal Real Estate Fund). The Multi-Manager Global RealEstate Fund’s concentration in real estate securities presentsspecial risk considerations.

INVESTMENT STRATEGY. The Multi-Manager Global Real EstateFund invests principally in companies that are engaged in realestate activities, including owning, trading or developingincome-producing real estate. The other Funds may invest inreal estate securities to the extent consistent with theirinvestment objectives and strategies.

SPECIAL RISKS. The performance of real estate securities may besignificantly impacted by the performance of real estatemarkets. Property values may fall due to increasing vacancies ordeclining rents resulting from economic, legal, cultural ortechnological developments. The price of real estate companyshares also may drop because of the failure of borrowers to paytheir loans and poor management. Many real estate companiesutilize leverage, which increases investment risk and couldadversely affect a company’s operations and market value inperiods of rising interest rates as well as risks normally

associated with debt financing. Real property investments aresubject to varying degrees of risk. The yields available frominvestments in real estate depend on the amount of income andcapital appreciation generated by the related properties. Incomeand real estate values may also be adversely affected by suchfactors as applicable domestic and foreign laws (e.g., Americanswith Disabilities Act and tax laws), interest rate levels and theavailability of financing. If the properties do not generatesufficient income to meet operating expenses, including, whereapplicable, debt service, ground lease payments, tenantimprovements, third-party leasing commissions and othercapital expenditures, the income and ability of the real estatecompany to make payments of any interest and principal on itsdebt securities will be adversely affected. In addition, realproperty may be subject to the quality of credit extended anddefaults by borrowers and tenants. The performance of theeconomy in each of the countries and regions in which the realestate owned by a Fund is located affects occupancy, marketrental rates and expenses and, consequently, has an impact onthe income from such properties and their underlying values.The financial results of major local employers also may have animpact on the cash flow and value of certain properties. Inaddition, real estate investments are relatively illiquid and,therefore, the ability of real estate companies to vary theirportfolios promptly in response to changes in economic orother conditions is limited. A real estate company such as aREIT may also have joint venture investments in certain of itsproperties and, consequently, its ability to control decisionsrelating to such properties may be limited.

REPURCHASE AGREEMENTS (principal strategy for the Multi-Manager Emerging Markets Debt Opportunity Fund).Repurchase agreements involve the purchase of securities by aFund subject to the seller’s agreement to repurchase them at amutually agreed upon date and price.

INVESTMENT STRATEGY. To the extent consistent with theirinvestment objectives and principal investment strategies, eachFund may enter into repurchase agreements with domestic andforeign financial institutions such as banks and broker-dealersthat are deemed to be creditworthy by the Investment Adviseror Sub-Advisers. Although the securities subject to a repurchaseagreement may have maturities exceeding one year, settlementof the agreement generally will not occur more than one yearafter a Fund acquires the securities.

SPECIAL RISKS. In the event of a default, a Fund will suffer a lossto the extent that the proceeds from the sale of the underlyingsecurities and other collateral are less than the repurchase priceand the Fund’s costs associated with delay and enforcement ofthe repurchase agreement. In addition, in the event ofbankruptcy, a Fund could suffer additional losses if a courtdetermines that the Fund’s interest in the collateral is



unenforceable by the Fund. If a Fund enters into a repurchaseagreement with a foreign financial institution, it may be subjectto the same risks associated with foreign investments (see“Foreign Investments” on page 65). The Funds intend to enterinto transactions with counterparties that are creditworthy atthe time of the transactions. There is always the risk that theInvestment Adviser’s analysis of creditworthiness is incorrect ormay change due to market conditions. To the extent that aFund focuses its transactions with a limited number ofcounterparties, it will be more susceptible to the risks associatedwith one or more counterparties.

With respect to collateral received in repurchase transactions orother investments, a Fund may have significant exposure to thefinancial services and mortgage markets. Such exposure,depending on market conditions, could have a negative impacton the Fund, including minimizing the value of any collateral.

SHORT SALES AGAINST-THE-BOX. A short sale against-the-box isa short sale such that at all times when the short position isopen the seller owns or has the right to obtain, at no addedcost, an equal amount of securities identical to those sold short.

INVESTMENT STRATEGY. To the extent consistent with theirinvestment objectives and strategies, the Funds may make shortsales against-the-box.

SPECIAL RISKS. If a Fund sells securities short against-the-box, itmay protect itself from loss if the price of the securities declinesin the future, but will lose the opportunity to profit on suchsecurities if the price rises. If a Fund effects a short sale ofsecurities at a time when it has an unrealized gain on thesecurities, it may be required to recognize that gain as if itactually had sold the securities (as a “constructive sale”) on thedate it effects the short sale. However, such constructive saletreatment may not apply if the Fund closes out the shortposition with securities other than the appreciated securitiesheld at the time of the short sale and if certain other conditionsare satisfied. Uncertainty regarding the tax consequences ofeffecting short sales may limit the extent to which a Fund mayeffect short sales.

SMALL AND MID-CAP INVESTMENTS (principal strategy for theActive M Emerging Markets Equity Fund, Active M InternationalEquity Fund, Multi-Manager Global Listed Infrastructure Fundand Multi-Manager Global Real Estate Fund). Investments insmall and mid-capitalization companies involve greater riskand more abrupt or erratic price movements than investmentsin larger capitalization stocks. Among the reasons for thegreater price volatility of these investments are the less certaingrowth or earnings prospects of smaller firms and the lowerdegree of liquidity in the markets for such securities. Small andmid-capitalization companies may be thinly traded and mayhave to be sold at a discount from current market prices or in

small lots over an extended period of time. In addition, thesesecurities are subject to the risk that during certain periods theliquidity of particular issuers or industries, or all securities inparticular investment categories, will shrink or disappearsuddenly and without warning as a result of adverse economicor market conditions, or adverse investor perceptions whetheror not accurate. Because of the lack of sufficient marketliquidity, a Fund may incur losses because it will be required toeffect sales at a disadvantageous time and only then at asubstantial drop in price. Small and mid-capitalizationcompanies include “unseasoned” issuers that do not have anestablished financial history; often have limited product lines,markets or financial resources; may depend on or use a few keypersonnel for management or upon a small or inexperiencedmanagement group; and may be susceptible to losses and risksof bankruptcy. Small and mid-capitalization companies may beoperating at a loss or have significant variations in operatingresults; may be engaged in a rapidly changing business withproducts subject to a substantial risk of obsolescence; mayrequire substantial additional capital to support theiroperations, to finance expansion or to maintain theircompetitive position; and may have substantial borrowings ormay otherwise have a weak financial condition. In addition,these companies may face intense competition, includingcompetition from companies with greater financial resources,more extensive development, manufacturing, marketing, andother capabilities, and a larger number of qualified managerialand technical personnel.

Transaction costs for small and mid-capitalization investmentsare often higher than those of larger capitalization companies.Investments in small and mid-capitalization companies may bemore difficult to price precisely than other types of securitiesbecause of their characteristics and lower trading volumes. As aresult, their performance may be more volatile and they canface a greater risk of business failure, which could increase thevolatility of a Fund’s investments. Securities of small andmid-capitalization companies may lack sufficient marketliquidity to enable a Fund to effect sales at an advantageoustime or without a substantial drop in price.

SOVEREIGN DEBT RISK (principal risk for the Multi-ManagerEmerging Markets Debt Opportunity Fund). The Multi-ManagerEmerging Markets Debt Opportunity Fund may invest insovereign debt securities. These securities are issued orguaranteed by foreign governmental entities. These investmentsare subject to the risk that a governmental entity may delay orrefuse to pay interest or repay principal on its sovereign debt,due, for example, to cash flow problems, insufficient foreigncurrency reserves, and political considerations. They are alsosubject to political risks (e.g., government instability, poorsocioeconomic conditions, corruption, lack of democraticaccountability, internal and external conflict, poor quality of



bureaucracy, and religious and ethnic tensions) and economicrisks (e.g., the relative size of the governmental entity’s debtposition in relation to the economy, high foreign debt as apercentage of gross domestic product or exports, high inflationor deflation, or an overvalued exchange rate) or a combinationof these risks, such as the failure to put in place economicreforms required by the International Monetary Fund or othermultilateral agencies. If a governmental entity defaults, it mayask for more time in which to pay or for further loans. There isno legal process for collecting sovereign debts that agovernment does not pay nor are there bankruptcy proceedingsthrough which all or part of the sovereign debt that agovernmental entity has not repaid may be collected.

STRIPPED SECURITIES. These securities are issued by the U.S.government (or an agency, instrumentality or a sponsoredenterprise), foreign governments, banks and other issuers. Theyentitle the holder to receive either interest payments orprincipal payments that have been “stripped” from a debtobligation. These obligations include stripped mortgage-backedsecurities, which are derivative multi-class mortgage securities.The Treasury Department has facilitated transfers of ownershipof zero coupon securities by accounting separately for thebeneficial ownership of particular interest coupon andprincipal payments on Treasury securities through the FederalReserve book-entry record-keeping system. The Federal Reserveprogram as established by the Treasury Department is knownas “Separate Trading of Registered Interest and Principal ofSecurities” or “STRIPS.” Under the STRIPS program, a Fundwill be able to have its beneficial ownership of zero couponsecurities recorded directly in the book-entry record-keepingsystem in lieu of having to hold certificates or other evidencesof ownership of the underlying U.S. Treasury securities.

INVESTMENT STRATEGY. To the extent consistent with theirinvestment objectives and strategies, the Funds may purchasestripped securities, including securities registered in the STRIPSprogram.

SPECIAL RISKS. Stripped securities are very sensitive to changesin interest rates and to the rate of principal prepayments. Arapid or unexpected change in either interest rates or principalprepayments could depress the price of stripped securities heldby the Funds and adversely affect a Fund’s total return.

STRUCTURED SECURITIES (principal strategy for the Multi-Manager Emerging Markets Debt Opportunity Fund and Multi-Manager High Yield Opportunity Fund). The value of suchsecurities is determined by reference to changes in the value ofspecific currencies, interest rates, commodities, securities,indices or other financial indicators (the “Reference”) or therelative change in two or more References. The interest rate orthe principal amount payable upon maturity or redemptionmay be increased or decreased depending upon changes in the

applicable Reference. Examples of structured securities include,but are not limited to, asset-backed commercial paper,structured notes and other debt obligations where the principalrepayment at maturity is determined by the value of a specifiedsecurity or securities index. Structured securities may alsoinclude credit linked notes, which are securities with embeddedcredit default swaps. An investor holding a credit linked notegenerally receives a fixed or floating coupon and the note’s parvalue upon maturity, unless the referred credit defaults ordeclares bankruptcy, in which case the investor receives theamount recovered. In effect, investors holding credit linkednotes receive a higher yield in exchange for assuming the risk ofa specified credit event.

Structured securities may also include inverse floating debtsecurities (“inverse floaters”). The interest rate on inversefloaters resets in the opposite direction from the market rate ofinterest to which the inverse floater is indexed. An inversefloater may be considered to be leveraged to the extent that itsinterest rate varies by a magnitude that exceeds the magnitudeof change in the index rate of interest. The higher the degree ofleverage of an inverse floater, the greater the volatility of itsmarket value.

Structured securities also include equity linked notes. An equitylinked note is a note whose performance is tied to a singlestock, a stock index or a basket of stocks. Equity linked notescombine the principal protection normally associated withfixed income investments with the potential for capitalappreciation normally associated with equity investments.Upon the maturity of the note, the holder generally receives areturn of principal based on the capital appreciation of thelinked securities. Depending on the terms of the note, equitylinked notes may also have a “cap” or “floor” on the maximumprincipal amount to be repaid to holders, irrespective of theperformance of the underlying linked securities. For example, anote may guarantee the repayment of the original principalamount invested (even if the underlying linked securities havenegative performance during the note’s term), but may cap themaximum payment at maturity at a certain percentage of theissuance price or the return of the underlying linked securities.Alternatively, the note may not guarantee a full return on theoriginal principal, but may offer a greater participation in anycapital appreciation of the underlying linked securities. Theterms of an equity linked note may also provide for periodicinterest payments to holders at either a fixed or floating rate.The secondary market for equity linked notes may be limited,and the lack of liquidity in the secondary market may makethese securities difficult to dispose of and to value.

INVESTMENT STRATEGY. The Multi-Manager High YieldOpportunity Fund may invest in structured securities. TheMulti-Manager Emerging Markets Debt Opportunity Fund



may invest in structured securities for hedging purposes and togain exposure to certain countries and currencies. The otherFunds may invest in structured securities to the extentconsistent with their investment objectives and strategies.

SPECIAL RISKS. Structured securities present additional risk thatthe interest paid to a Fund on a structured security will be lessthan expected. The terms of some structured securities mayprovide that in certain circumstances no principal is due atmaturity and, therefore, a Fund could suffer a total loss of itsinvestment. Structured securities may be positively ornegatively indexed, so that appreciation of the Reference mayproduce an increase or decrease in the interest rate or value ofthe security at maturity. In addition, changes in the interestrates or the value of the security at maturity may be a multipleof changes in the value of the Reference. Consequently,structured securities may entail a greater degree of market riskthan other types of securities. Structured securities also may bemore volatile, less liquid and more difficult to accurately pricethan less complex securities due to their derivative nature.Structured securities are also subject to counterparty risk.

TECHNOLOGY SECURITIES RISK (principal risk for the Active MEmerging Markets Equity Fund and Active M InternationalEquity Fund). Investments in technology securities presentspecial risk considerations. Technology companies mayproduce or use products or services that prove commerciallyunsuccessful, become obsolete or become adversely impactedby government regulation. Competitive pressures in thetechnology industry, both domestically and internationally,may affect negatively the financial condition of technologycompanies, and a substantial investment in technologysecurities may subject the Funds to more volatile pricemovements than a more diversified securities portfolio. Incertain instances, technology securities may experiencesignificant price movements caused by disproportionateinvestor optimism or pessimism with little or no basis infundamental economic conditions. Technology companies mayhave limited product lines, markets, financial resources orpersonnel. The products of technology companies may faceobsolescence due to rapid technological developments, frequentand new product introduction, unpredictable changes ingrowth rates and competition for the services of qualifiedpersonnel. In addition to the foregoing risks, technologycompanies operating in the health sciences and healthcaresector may be subject to product liability litigation. As a resultof these and other reasons, investments in the technologyindustry can experience sudden and rapid appreciation anddepreciation.

In addition, the Funds may make substantial investments incompanies that develop or sell computer hardware or softwareand peripheral products, including computer components,

which present additional risks. These companies are oftendependent on the existence and health of other products orindustries and face highly competitive pressures, productlicensing, trademark and patent uncertainties and rapidtechnological changes that may have a significant effect on theirfinancial condition. For example, an increasing number ofcompanies and new product offerings can lead to price cuts andslower selling cycles, and many of these companies may bedependent on the success of a principal product, may rely onsole source providers and third-party manufacturers, and mayexperience difficulties in managing growth.

TEMPORARY INVESTMENTS. The Funds temporarily may holdcash and/or invest in short-term obligations including U.S.government obligations, high quality money marketinstruments (including commercial paper and obligations offoreign and domestic banks such as certificates of deposit, bankand deposit notes, bankers’ acceptances and fixed timedeposits), and repurchase agreements with maturities of13 months or less.

INVESTMENT STRATEGY. A Fund temporarily may hold cash orinvest all or any portion of its assets in short-term obligationspending investment, to meet anticipated redemption requestsor to manage a reallocation of assets to a Sub-Adviser. A Fundalso may hold cash or invest in short-term obligations as atemporary measure mainly designed to limit a Fund’s losses inresponse to adverse market, economic or other conditionswhen the Sub-Advisers believe that it is in the best interest ofthe Fund to pursue such a defensive strategy. The Sub-Advisersmay, however, choose not to make such temporary investmentseven in very volatile or adverse conditions.

SPECIAL RISKS. A Fund may not achieve its investment objectivewhen it holds cash or invests its assets in short-term obligationsor otherwise makes temporary investments. A Fund also maymiss investment opportunities and have a lower total returnduring these periods.

U.S. GOVERNMENT OBLIGATIONS. These instruments includeU.S. Treasury obligations, such as bills, notes and bonds, whichgenerally differ only in terms of their interest rates, maturitiesand time of issuance. They also include obligations issued orguaranteed by the U.S. government or by its agencies,instrumentalities or sponsored enterprises. Securitiesguaranteed as to principal and interest by the U.S. governmentor by its agencies, instrumentalities or sponsored enterprisesare deemed to include (a) securities for which the payment ofprincipal and interest is backed by an irrevocable letter of creditissued by the U.S. government or by an agency, instrumentalityor sponsored enterprise thereof, and (b) participations in loansmade to foreign governments or their agencies that are soguaranteed. U.S. treasury obligations also include floating ratepublic obligations of the U.S. Treasury.



INVESTMENT STRATEGY. To the extent consistent with itsinvestment objective and strategies, each Fund may invest in avariety of U.S. Treasury obligations and in other obligationsissued or guaranteed by the U.S. government or by its agencies,instrumentalities or sponsored enterprises.

SPECIAL RISKS. Not all U.S. government obligations carry thesame credit support. Although many U.S. government securitiesare issued by entities chartered or sponsored by Acts ofCongress, such as the Federal National Mortgage Association(“Fannie Mae”), the Federal Home Loan Mortgage Corporation(“Freddie Mac”) and the Federal Home Loan Banks, suchsecurities are neither issued nor guaranteed by the U.S. Treasuryand, therefore, are not backed by the full faith and credit of theUnited States. Some, such as those of the Government NationalMortgage Association (“Ginnie Mae”), are supported by the fullfaith and credit of the U.S. Treasury, although this guaranteeapplies only to principal and interest payments and does notapply to losses resulting from declines in the market value ofthese securities. Other obligations, such as those of the FederalHome Loan Banks, are supported by the right of the issuer toborrow from the U.S. Treasury; and others are supported by thediscretionary authority of the U.S. government to purchase theagency’s obligations. Still others are supported only by the creditof the instrumentality or sponsored enterprise. The maximumpotential liability of the issuers of some U.S. governmentsecurities may greatly exceed their current resources, includingtheir legal right to support from the U.S. Treasury. It is possiblethat these issuers will not have the funds to meet their paymentobligations in the future. No assurance can be given that theU.S. government would provide financial support to itsagencies, instrumentalities or sponsored enterprises if it is notobligated to do so by law. In addition, the secondary market forcertain participations in loans made to foreign governments ortheir agencies may be limited.

An agency of the U.S. government has placed Fannie Mae andFreddie Mac into conservatorship, a statutory process with theobjective of returning the entities to normal businessoperations. It is unclear what effect this conservatorship willhave on the securities issued or guaranteed by Fannie Mae orFreddie Mac. As a result, these securities are subject to morecredit risk than U.S. government securities that are supportedby the full faith and credit of the United States (e.g. U.S.Treasury bonds).

To the extent a Fund invests in debt instruments or securities ofnon-U.S. government entities that are backed by the full faithand credit of the United States, pursuant to the FDIC DebtGuarantee Program (the “Debt Guarantee Program”) or othersimilar programs, there is a possibility that the guaranteeprovided under the Debt Guarantee Program or other similarprograms may be discontinued or modified at a later date.

Floating rate public obligations of the U.S. Treasury (“FloatingRate Notes” or “FRNs”) have interest rates that adjustperiodically. FRNs’ floating interest rates may be higher orlower than the interest rates of fixed-rate bonds of comparablequality with similar maturities. Securities with floating rates canbe less sensitive to interest rate changes than securities withfixed interest rates, but may decline in value and negativelyimpact a Fund, particularly if changes in prevailing interestrates are more frequent or sudden than the rate changes for theFRNs, which only occur periodically (see “Variable andFloating Rate Instruments” below).

VALUATION RISK (principal risk for all Funds). The sale price aFund could receive for a security may differ from the Fund’svaluation of the security, particularly for securities that trade inlow volume or volatile markets, or that are valued using a fairvalue methodology. Fair valuation of the Fund’s investmentsinvolves subjective judgment. Because portfolio securities ofcertain Funds may be traded on non-U.S. exchanges, andnon-U.S. exchanges may be open on days when the Fund doesnot price its shares, the value of the securities in the Fund’sportfolio may change on days when shareholders will not beable to purchase or sell the Fund’s shares. In addition, theFund’s ability to value its investments may be impacted bytechnological issues and/or errors by pricing services or otherthird-party service providers.

VARIABLE AND FLOATING RATE INSTRUMENTS. Variable andfloating rate instruments have interest rates that periodically areadjusted either at set intervals or that float at a margin tied to aspecified index rate. These instruments include floating rateTreasury obligations, variable amount master demand notesand long-term variable and floating rate bonds (sometimesreferred to as “Put Bonds”) where the Fund obtains at the timeof purchase the right to put the bond back to the issuer or athird party at par at a specified date and leveraged inversefloating rate instruments (“inverse floaters”). An inverse floateris leveraged to the extent that its interest rate varies by anamount that exceeds the amount of the variation in the indexrate of interest. Some variable and floating rate instrumentshave interest rates that periodically are adjusted as a result ofchanges in inflation rates.

INVESTMENT STRATEGY. Each of the Funds may invest invariable and floating rate instruments to the extent consistentwith its investment objective and strategies.

SPECIAL RISKS. Variable and floating rate instruments aresubject to many of the same risks as fixed rate instruments,particularly credit risk and default risk, which could impedetheir value. Because there is no active secondary market forcertain variable and floating rate instruments, they may bemore difficult to sell if the issuer defaults on its paymentobligations or during periods when a Fund is not entitled to



exercise its demand rights. As a result, the Funds could suffer aloss with respect to these instruments. In addition, variable andfloating rate instruments are subject to changes in value basedon changes in market interest rates or changes in the issuer’s orguarantor’s creditworthiness. In addition, there may be a lagbetween an actual change in the underlying interest ratebenchmark and the reset time for an interest payment of avariable or floating instrument, which could harm or benefit aFund, depending on the interest rate environment or othercircumstances. In a rising interest rate environment, forexample, a floating or variable rate instrument that does notreset immediately would prevent a Fund from taking fulladvantage of rising interest rates in a timely manner.

In 2017, the FCA warned that the LIBOR may cease to beavailable or appropriate for use by 2021. The unavailability orreplacement of LIBOR may affect the value, liquidity or returnon certain Fund investments and may result in costs incurredin connection with closing out positions and entering into newtrades. Any pricing or adjustments to a Fund’s investmentsresulting from a substitute reference rate may adversely affectthe Fund’s performance and/or NAV (see “LIBOR Transition”above).

WARRANTS. A warrant represents the right to purchase asecurity at a predetermined price for a specified period of time.

INVESTMENT STRATEGY. The Multi-Manager Emerging MarketsDebt Opportunity Fund and the Multi-Manager High YieldOpportunity Fund may invest in warrants that are acquired inconnection with its investments in debt or convertiblesecurities as part of its principal investment strategy. Each ofthe other Funds may invest in warrants and similar rights to theextent consistent with its investment objectives and strategies.A Fund also may purchase bonds that are issued in tandemwith warrants.

SPECIAL RISKS. Warrants are derivative instruments that presentrisks similar to options.

WHEN-ISSUED SECURITIES, DELAYED DELIVERY TRANSACTIONS

AND FORWARD COMMITMENTS. A purchase of “when-issued”securities refers to a transaction made conditionally because thesecurities, although authorized, have not yet been issued. Adelayed delivery or forward commitment transaction involves acontract to purchase or sell securities for a fixed price at afuture date beyond the customary settlement period.

INVESTMENT STRATEGY. Each Fund may purchase or sellsecurities on a when-issued, delayed delivery or forwardcommitment basis. Although the Funds generally wouldpurchase securities in these transactions with the intention ofacquiring the securities, the Funds may dispose of suchsecurities prior to settlement if a Sub-Adviser deems itappropriate to do so.

SPECIAL RISKS. Purchasing securities on a when-issued, delayeddelivery or forward commitment basis involves the risk that thevalue of the securities may decrease by the time they actuallyare issued or delivered. Conversely, selling securities in thesetransactions involves the risk that the value of the securitiesmay increase by the time they actually are issued or delivered.Therefore, these transactions may have a leveraging effect on aFund, making the value of an investment in the Fund morevolatile and increasing the Fund’s overall investment exposure.These transactions also involve the risk that the counterpartymay fail to deliver the security or cash on the settlement date. Ifthis occurs, a Fund may lose both the investment opportunityfor the assets it set aside to pay for the security and any gain inthe security’s price.

ZERO COUPON, PAY-IN-KIND AND CAPITAL APPRECIATION

BONDS. These are securities issued at a discount from their facevalue because interest payments typically are postponed untilmaturity. Interest payments on pay-in-kind securities arepayable by the delivery of additional securities. The amount ofthe discount rate varies depending on factors such as the timeremaining until maturity, prevailing interest rates, a security’sliquidity and the issuer’s credit quality. These securities alsomay take the form of debt securities that have been stripped oftheir interest payments.

INVESTMENT STRATEGY. The Multi-Manager High YieldOpportunity Fund may invest in zero coupon, pay-in-kind andcapital appreciation bonds as part of its principal investmentstrategy. Each of the other Funds also may invest in zerocoupon, pay-in-kind and capital appreciation bonds to theextent consistent with its investment objective and strategies.

SPECIAL RISKS. The market prices of zero coupon, pay-in-kindand capital appreciation bonds generally are more volatile thanthe market prices of interest-bearing securities and are likely torespond to a greater degree to changes in interest rates thaninterest-bearing securities having similar maturities and creditquality. A Fund’s investments in zero coupon, pay-in-kind andcapital appreciation bonds may require the Fund to sell some ofits Fund securities to generate sufficient cash to satisfy certainincome distribution requirements.

OTHER SECURITIES. Additionally, the Funds may purchase othertypes of securities or instruments similar to those described inthese sections if otherwise consistent with the Funds’ investmentobjectives and strategies. You should carefully consider the risksdiscussed in these sections before investing in a Fund.

The Funds may invest in other securities and are subject tofurther restrictions and risks that are described in the SAI.Additional information about the Funds, their investments andrelated risks can also be found in “Investment Objectives andStrategies” in the SAI.



D I S C L A I M E R S

The Active M Emerging Markets Equity Fund is not sponsored,endorsed, sold or promoted by MSCI, nor does MSCIguarantee the accuracy and/or completeness of the MSCIEmerging Markets Index or MSCI Frontier Markets Index, orany data included therein. MSCI makes no warranty, express orimplied, as to the results to be obtained by any Fund, owners ofany Fund, any person or any entity from the use of the MSCIEmerging Markets Index or MSCI Frontier Markets Index, orany data included therein. MSCI makes no express or impliedwarranties and expressly disclaims all such warranties ofmerchantability or fitness for a particular purpose or use withrespect to the MSCI Emerging Markets Index or MSCI FrontierMarkets Index, or any data included therein.

The Active M International Equity Fund is not sponsored,endorsed, sold or promoted by MSCI, nor does MSCIguarantee the accuracy and/or completeness of the MSCIWorld ex USA IM Index or any data included therein. MSCImakes no warranty, express or implied, as to the results to beobtained by any Fund, owners of any Fund, any person or anyentity from the use of the MSCI World ex USA IM Index or anydata included therein. MSCI makes no express or impliedwarranties and expressly disclaims all such warranties ofmerchantability or fitness for a particular purpose or use withrespect to the MSCI World ex USA IM Index or any dataincluded therein.

The Multi-Manager Emerging Markets Debt Opportunity Fundis not sponsored, endorsed, sold or promoted by JP Morgan,nor does JP Morgan guarantee the accuracy and/orcompleteness of the JP Morgan EMBI Global Diversified Indexor the JP Morgan GBI-EM Global Diversified Index, or anydata included therein. JP Morgan makes no warranty, expressor implied, as to the results to be obtained by any Fund, ownersof any Fund, any person or any entity from the use of theJP Morgan EMBI Global Diversified Index or the JP MorganGBI-EM Global Diversified Index, or any data included therein.JP Morgan makes no express or implied warranties andexpressly disclaims all such warranties of merchantability orfitness for a particular purpose or use with respect to theJP Morgan EMBI Global Diversified Index or the JP MorganGBI-EM Global Diversified Index, or any data included therein.

The Multi-Manager Global Listed Infrastructure Fund is notsponsored, endorsed, sold or promoted by S&P, nor does S&Pguarantee the accuracy and/or completeness of the S&P GlobalInfrastructure Index, or any data included therein. S&P makesno warranty, express or implied, as to the results to be obtainedby any Fund, owners of any Fund, any person or any entity

from the use of the S&P Global Infrastructure Index, or anydata included therein. S&P makes no express or impliedwarranties and expressly disclaims all such warranties ofmerchantability or fitness for a particular purpose or use withrespect to the S&P Global Infrastructure Index, or any dataincluded therein.

The Multi-Manager Global Real Estate Fund is not sponsored,endorsed, sold or promoted by FTSE, EPRA or NAREIT, nordo FTSE, EPRA or NAREIT guarantee the accuracy and/orcompleteness of the FTSE® EPRA®/NAREIT® Developed® Indexor any data included therein. FTSE, EPRA and NAREIT makeno warranty, express or implied, as to the results to be obtainedby any Fund, owners of any Fund, any person or any entityfrom the use of the FTSE® EPRA®/NAREIT® Developed® Indexor any data included therein. FTSE, EPRA and NAREIT makeno express or implied warranties and expressly disclaim all suchwarranties of merchantability or fitness for a particular purposeor use with respect to the FTSE® EPRA®/NAREIT® Developed®

Index or any data included therein. The SAI contains a moredetailed description of the limited relationships FTSE, EPRAand NAREIT have with Northern Trust and the Global RealEstate Index Fund.

The Multi-Manager High Yield Opportunity Fund is notsponsored, endorsed, sold or promoted by IntercontinentalExchange, nor does Intercontinental Exchange guarantee theaccuracy and/or completeness of the ICE BofA U.S. High YieldConstrained Index, or any data included therein.Intercontinental Exchange makes no warranty, express orimplied, as to the results to be obtained by any Fund, owners ofany Fund, any person or any entity from the use of the ICEBofA U.S. High Yield Constrained Index or any data includedtherein. Intercontinental Exchange makes no express orimplied warranties and expressly disclaims all such warrantiesof merchantability or fitness for a particular purpose or usewith respect to the ICE BofA U.S. High Yield ConstrainedIndex or any data included therein.

NTI does not guarantee the accuracy and/or the completenessof the broad-based securities market indices or any dataincluded therein or the descriptions of the index providers, andNTI shall have no liability for any errors, omissions, orinterruptions therein.

NTI makes no express or implied warranties, and expresslydisclaims all warranties of merchantability or fitness for aparticular purpose or use with respect to any index or any dataincluded therein. Without limiting any of the foregoing, in noevent shall NTI have any liability for any special, punitive,direct, indirect, or consequential damages (including lostprofits), even if notified of the possibility of such damages.



F I N A N C I A L H I G H L I G H T S

THE FINANCIAL HIGHLIGHTS TABLES ARE INTENDED TO HELP YOU UNDERSTAND A FUND’S

FINANCIAL PERFORMANCE FOR THE PAST FIVE YEARS (OR, IF SHORTER, THE PERIOD OF THE FUND’S

OPERATION).

Certain information reflects the financial results for a single Fund share. The total returns in the tables

represent the rate that an investor would have earned or lost on an investment in a Fund for a share held

for the entire period (assuming reinvestment of all dividends and distributions). This information has been

derived from financial statements that have been audited by Deloitte & Touche LLP, an independent

registered public accounting firm, whose report, along with the Funds’ financial statements, are

incorporated by reference into this Prospectus and included in the Funds’ annual report. The Funds’

annual report, which is available upon request and without charge by calling 800-595-9111, is also

available on the Trust’s website at northerntrust.com/funds or by following the hyperlink:

https://www.sec.gov/Archives/edgar/data/916620/000119312520161887/d927856dncsr.htm.





Selected per share data 2020 2019 2018 2017 2016

Net Asset Value, Beginning of Year $19.49 $22.55 $18.05 $15.36 $18.25

INCOME (LOSS) FROM INVESTMENT OPERAT IONS:

Net investment income 0.59 0.42 0.28 0.20 0.25

Net realized and unrealized gains (losses) (3.84) (3.30) 4.22 2.79 (2.49)

Total from Investment Operations (3.25) (2.88) 4.50 2.99 (2.24)

LESS DISTR IBUT IONS PAID :

From net investment income(1) (0.88) (0.18) — (0.30) (0.28)

From net realized gains (0.75) — — — (0.37)

Total Distributions Paid (1.63) (0.18) — (0.30) (0.65)

Net Asset Value, End of Year $14.61 $19.49 $22.55 $18.05 $15.36

Total Return(2) (18.77)% (12.71)% 24.93% 19.75% (12.11)%

SUPPLEMENTAL DATA AND RAT IOS :

Net assets, in thousands, end of year $338,370 $816,363 $1,268,985 $962,121 $677,066

Ratio to average net assets of:

Expenses, net of reimbursements and credits(3) 1.10% 1.10% 1.10% 1.15%(4) 1.35%

Expenses, before reimbursements and credits 1.26% 1.21% 1.21% 1.28%(4) 1.45%

Net investment income, net of reimbursements and credits(3) 1.85% 1.61% 1.34% 1.13%(4) 1.32%

Net investment income, before reimbursements and credits 1.69% 1.50% 1.23% 1.00%(4) 1.22%

Portfolio Turnover Rate 81.32% 80.98% 36.14% 59.52% 37.58%

(1) Distributions to shareholders from net investment income include amounts related to foreign currency transactions, which are treated as ordinary income for federalincome tax purposes.

(2) Assumes investment at net asset value at the beginning of the year, reinvestment of all dividends and distributions, and a complete redemption of the investment atnet asset value at the end of the year.

(3) The net expenses and net investment income ratios include additional reimbursements of management fees incurred in connection with the investment of uninvestedcash in affiliated money market funds of approximately $17,000, $42,000 and $46,000, which represent less than 0.01 percent of average net assets for thefiscal years ended March 31, 2020 , 2019 and 2018, respectively, and approximately $36,000, and $16,000, which represent less than 0.005 percent ofaverage net assets for the fiscal years ended March 31, 2017, and 2016, respectively. Absent the additional reimbursements, net investment income andreimbursements would have been decreased and net expenses would have been increased by a corresponding amount.

(4) Effective June 15, 2016, the investment adviser reduced the management fee paid by the Fund and agreed to increase the expense reimbursement it provides theFund by contractually limiting the Fund’s total expenses (other than certain excepted expenses) to 1.10%. Prior to June 15, 2016, the expense limitation had been1.35%.



FOR THE FISCAL YEARS ENDED MARCH 31,






Net realized and unrealized gains (losses) (1.85) (0.91) 1.74 0.60 (1.15)



From net investment income(1) (0.26) (0.29) (0.16) (0.16) (0.07)

From net realized gains (0.39) (0.34) — — —

Total Distributions Paid (0.65) (0.63) (0.16) (0.16) (0.07)


Total Return(2) (17.49)% (5.32)% 19.17% 8.27% (9.77)%


Net assets, in thousands, end of year $558,183 $915,696 $1,390,844 $1,156,348 $1,448,577









(3) The net expenses and net investment income ratios include additional reimbursements of management fees incurred in connection with the investment of uninvestedcash in affiliated money market funds of approximately $45,000, $66,000, $77,000 and $71,000 which represent less than 0.01 percent of average net assetsfor the fiscal years ended March 31, 2020, 2019, 2018 and 2017, respectively, and approximately $57,000 which represents less than 0.005 percent ofaverage net assets for the fiscal year ended March 31, 2016. Absent the additional reimbursements, net investment income and reimbursements would have beendecreased and net expenses would have been increased by a corresponding amount.










Net realized and unrealized gains (losses) (1.70) (0.85) 0.30 0.03 (0.55)(1)



From net investment income(2) (0.25) (0.29) (0.49) (0.13) —

Return of capital — — — —(3) (0.06)



Total Return(4) (13.20)% (3.39)% 9.30% 6.32% (2.25)%


Net assets, in thousands, end of year $132,714 $174,193 $189,630 $98,397 $66,299


Expenses, net of reimbursements and credits(5) 0.94% 0.95% 0.94% 0.95% 0.95%

Expenses, before reimbursements and credits 1.02% 1.05% 1.05% 1.14% 1.11%

Net investment income, net of reimbursements and credits(5) 5.44% 5.67% 5.36% 5.48% 5.00%

Net investment income, before reimbursements and credits 5.36% 5.57% 5.25% 5.29% 4.84%


(1) The Fund received reimbursements from Northern Trust Investments, Inc. of approximately $52,000. The reimbursements represents less than $0.01 per share andhad no effect on the Fund’s total return.


(3) Per share amounts from distributions paid from return of capital were less than $0.01 per share.


(5) The net expenses and net investment income ratios include additional reimbursements of management fees incurred in connection with the investment of uninvestedcash in affiliated money market funds of approximately $9,000, $11,000, $13,000, $8,000 and $5,000, which represent less than 0.01 percent of averagenetassets for the fiscal years ended March 31, 2020, 2019, 2018, 2017 and 2016, respectively. Absent the additional reimbursements, net investment income andreimbursements would have been decreased and net expenses would have been increased by a corresponding amount.







INCOME (LOSS) FROM INVESTMENTOPERAT IONS:


Net realized and unrealized gains (losses) (1.61) 0.08 0.51 1.22 (0.53)

Total from Investment Operations (1.30) 0.44 0.89 1.50 (0.22)



From net realized gains — (0.75) (0.59) — —



Total Return(2) (11.09)% 4.24% 6.62% 12.96% (1.80)%


Net assets, in thousands, end of year $896,220 $1,009,594 $1,205,762 $1,248,307 $1,178,180


Expenses, net of reimbursements and credits(3) 0.98% 1.00% 1.00% 1.00% 1.00%

Expenses, before reimbursements and credits 0.98% 1.02% 1.02% 1.02% 1.02%

Net investment income, net of reimbursements and credits(3) 2.45% 2.81% 2.59% 2.24% 2.51%

Net investment income, before reimbursements and credits 2.45% 2.79% 2.57% 2.22% 2.49%




(3) The net expenses and net investment income ratios include additional reimbursements of management fees incurred in connection with the investment of uninvestedcash in affiliated money market funds of approximately $77,000, $66,000, $97,000 and $52,000 which represent less than 0.01 percent of average net assetsfor the fiscal years ended March 31, 2020, 2019, 2018 and 2017, respectively, and approximately $33,000 which represents less than 0.005 percent ofaverage net assets for the fiscal year ended March 31, 2016. Absent the additional reimbursements, net investment income and reimbursements would have beendecreased and net expenses would have been increased by a corresponding amount.









Net realized and unrealized gains (losses) (2.28) 1.01 0.35 (0.04) (0.71)




From net realized gains — (0.12) (0.10) (1.06) (3.90)



Total Return(2) (18.86)% 13.28% 3.93% 2.72% (1.46)%











(3) The net expenses and net investment income ratios include additional reimbursements of management fees incurred in connection with the investment of uninvestedcash in affiliated money market funds of approximately $5,000, $3,000, $8,000 and $16,000 which represent less than 0.01 percent of average net assets forthe fiscal years ended March 31, 2020, 2019, 2018 and 2017, respectively, and approximately $14,000 which represents less than 0.005 percent of averagenet assets for the fiscal year ended March 31, 2016. Absent the additional reimbursements, net investment income and reimbursements would have beendecreased and net expenses would have been increased by a corresponding amount.










Net realized and unrealized gains (losses) (1.59) (0.25) (0.20) 0.91 (1.03)




From net realized gains — — — — (0.05)



Total Return(2) (10.79)% 3.75% 4.37% 17.41% (5.19)%











(3) The net expenses and net investment income ratios include additional reimbursements of management fees incurred in connection with the investment of uninvestedcash in affiliated money market funds of approximately $18,000, $31,000, $18,000, $25,000, and 29,000, which represent less than 0.01 percent of averagenet assets for the fiscal years ended March 31, 2020, 2019, 2018, 2017, and 2016, respectively. Absent the additional reimbursements, net investment incomeand reimbursements would have been decreased and net expenses would have been increased by a corresponding amount.




F O R M O R E I N F O R M A T I O N

A N N U A L / S E M I A N N U A L R E P O R T S A N D S T A T E M E N T

O F A D D I T I O N A L I N F O R M A T I O N

Additional information about the Funds’ investments isavailable in the Funds’ annual and semiannual reports toshareholders. In the Funds’ annual report, you will find adiscussion of the market conditions and investment strategiesthat significantly affected the Funds’ performance during theirlast fiscal year.

Additional information about the Funds and their policies isalso available in the Funds’ SAI. The SAI is incorporated byreference into this Prospectus (and is legally considered part ofthis Prospectus).

The Funds’ annual and semiannual reports and the SAI areavailable free upon request by calling the Northern FundsCenter at 800-595-9111 or by sending an email request to:[email protected]. The SAI and other information areavailable from a financial intermediary (such as a broker-dealeror bank) through which the Funds’ shares may be purchased orsold.

TO OBTAIN OTHER INFORMATION AND FOR SHAREHOLDER

INQUIRIES:

B Y T E L E P H O N E

Call 800-595-9111

B Y M A I L


O N T H E I N T E R N E T

The Funds’ documents are available online and may bedownloaded from:

▪ The EDGAR database on the SEC’s website at www.sec.gov(text-only).

▪ Northern Funds’ website at northerntrust.com/funds.

Reports and other information about Northern Funds’ areavailable on the EDGAR database on the SEC’s internet site athttp://www.sec.gov. You also may obtain copies of NorthernFunds’ documents, after paying a duplicating fee, by electronicrequest to: [email protected].

811-08236

ACTIVE M/MULTI -MANAGER FUNDS 96 NORTHERN FUNDS PROSPECTUS MMF PRO (7/20)

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