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Sextant Bond Income Fund


Fund Facts

As of December 31, 2016
Net Assets: $9.68 Million
Ticker Symbol: SBIFX
CUSIP: 804096303
Inception Date: March 1, 1993†
Minimum Initial Investment: $1,000
30-Day Yield¹: 2.58%

† The Sextant Bond Income Fund began operation under its current objective Sept. 28, 1995. Previously, it was the Washington Tax-Exempt Fund.

Portfolio Managers

Phelps McIlvaine

Portfolio Manager since 1996

Phelps McIlvaine, Vice President, joined Saturna Capital in 1993. He serves Saturna as Portfolio Manager and a Research Analyst for Idaho Tax-Exempt Fund, Sextant Short-Term Bond Fund and Sextant Bond Income Fund. He also acts as Director for Saturna's wholly-owned brokerage subsidiary, Saturna Brokerage Services. Mr. McIlvaine was born in Illinois in 1953, and has a BA in economics (University of Denver, 1975 Phi Beta Kappa).

Mr. McIlvaine entered the investment business in 1976 and traded US bond and derivative markets from 1977 to 1986 for commercial banks in Boston and Chicago. From 1987 to 1993 he managed fixed income derivative hedge funds in Chicago and London. He serves on the Endowment Committees of the Nooksack Salmon Enhancement Association and the Bellingham Interfaith Coalition.

SCC: Director, Vice President
SBS: Director, Vice President

Patrick Drum MBA, CFA, CFP®

Deputy Portfolio Manager since 2015

Patrick T. Drum, Research Analyst, and Saturna Sustainable Bond Fund and Amana Participation Fund Portfolio Manager joined Saturna Capital in October 2014. He is an adjunct professor of finance for the Sustainable MBA Program at the Bainbridge Graduate Institute (BGI) at Pinchot. Mr. Drum holds a BA in economics from Western Washington University and an MBA from Seattle University Albers School of Business. He is a Chartered Financial Analyst® (CFA®) charterholder and a Certified Financial Planner®.

Prior to joining Saturna Capital, Mr. Drum led environmental, social, and governance (ESG) research and was director of fixed income portfolio management since 2007 at The Arbor Group, a member of UBS Institutional Consulting Services specializing in investment management for global conservation and national wildlife park endowments as well as sustainable-social screened private client portfolios.

Mr. Drum's past experience also includes business valuation at Moss Adams and portfolio management at Washington Mutual Bank. He lives in Bellingham and is a proud father of two. He enjoys sea kayaking, hiking, and being part of the Pacific Northwest community.

Investment Style

Targeted to investors seeking current income

Dollar-weighted average maturity of ten years or more

Diversified across industries and companies

Actively managed by the award-winning, values-based, global expertise of Saturna Capital

Investment Objective

Current income.

Principal Investment Strategies

The Bond Income Fund invests at least 80% of its assets in bonds. Under normal circumstances, the Fund maintains a dollar-weighted average maturity of ten years or more. The Fund invests at least 65% of assets in bonds rated within the three highest grades (Aaa, Aa or A) and may not invest in a bond rated at time of purchase below the fourth highest grade (Baa).

Principal Risks of Investing

Market risk: The value of the Fund's shares rises and falls as the market value of the securities in which the Fund invests goes up and down. The market value of securities will fluctuate, sometimes significantly and unpredictably, with stocks generally being more volatile than bonds. When you redeem your shares, they may be worth more or less than what you paid for them. Only consider investing in the Fund if you are willing to accept the risk that you may lose money.

Interest rate risk: Investing in bonds includes the risk that as interest rates rise, bond prices will fall. Conversely, during periods of declining interest rates bond prices generally rise, but bond issuers may call or prepay the bond and reissue debt at lower interest rates. The longer a bond's maturity, the more sensitive the bond is to interest rate changes.

Credit risk: Investing in bonds includes the risk that an issuer will not pay interest or principal when due, or the issuer may default altogether. If an issuer's credit quality is perceived to decline, the value and liquidity of the issuer's bonds may also decline.

Liquidity risk: Liquidity risk exists when particular investments are difficult to sell and may be more difficult to value. If the Fund is forced to sell these investments during unfavorable conditions to meet redemptions or for other cash needs, the Fund may lose money on its investments. As a result, the Fund may be unable to achieve its objective.


Daily Price and Stats

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As of January 23, 2017 Ticker Price Change YTD 30-Day Yield¹
Sextant Bond Income SBIFX $5.10 $0.03 0.59% 2.75%

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Average Annual Total Returns

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Month-end, as of December 31, 2016 Ticker 1 Year 3 Year 5 Year 10 Year Expense
Sextant Bond Income SBIFX 3.91% 3.62% 2.52% 4.20% 1.03% 2.58%
Citi US Broad Investment-Grade Bond Index 2.66% 3.01% 2.22% 4.42% n/a n/a
Quarter-end, as of December 31, 2016 Ticker 1 Year 3 Year 5 Year 10 Year Expense
Sextant Bond Income SBIFX 3.91% 3.62% 2.52% 4.20% 1.03% 2.58%
Citi US Broad Investment-Grade Bond Index 2.66% 3.01% 2.22% 4.42% n/a n/a

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Growth of $10,000

Growth of $10,000Growth of $10,000

This chart illustrates the performance of a hypothetical $10,000 invested at the beginning of the period and redeemed at the end of the period, and assumes reinvestment of all dividends and capital gains.

Annual Total Returns

As of December 31, 2016

Annual Total ReturnsAnnual Total Returns

The Citigroup Broad Investment Grade Bond Index is a broad-based index of medium and long-term investment grade bond prices that reflects no deductions for fees, expenses, or taxes.


As of December 31, 2016

Top Ten Holdings

US Treasury Bond (5.375% 02/15/2031) 5.5%
Apple 3.9%
Intel 3.8%
Microsoft 3.8%
US Treasury Bond (6.25% 05/15/2030) 3.3%
Cincinnati Financial 3.2%
EMC/Dell 3.2%
Puget Sound Energy 3.1%
Becton Dickinson 3.1%
Statoil ASA (Norsk Hydro Yankee) 3.1%
Total 36.0%

View full month-end portfolio schedule. This link will open a new browser window.

Sector Allocation

Municipal Bonds 19.9% 19.9% Sextant Bond Income Fund Sector Allocation
Technology 14.7% color box key
Health Care 12.4% color box key
Government Bonds 11.1% color box key
Energy 8.7% color box key
Financial 8.3% color box key
Utilities 6.8% color box key
Industrials 4.3% color box key
Consumer Staples 2.7% color box key
Consumer Discretionary 2.4% color box key
Foreign Government Bonds 2.3% color box key
Materials 0.6% color box key
Cash and equivalents 5.8% color box key

Security and sector weightings are shown as a percentage of total net assets.


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Record Date Ex, Pay and
Reinvest Date
Capital Gains
Capital Gains
Total Distributions
(per share)
Sextant Bond Income (SBIFX)
12/29/2016 12/30/2016 $0.01224 $0.00 $0.00 $0.00 $0.01224
11/29/2016 11/30/2016 $0.01169 $0.00 $0.00 $0.00 $0.01169
10/28/2016 10/31/2016 $0.01233 $0.00 $0.00 $0.00 $0.01233
09/29/2016 09/30/2016 $0.01144 $0.00 $0.00 $0.00 $0.01144
08/30/2016 08/31/2016 $0.01238 $0.00 $0.00 $0.00 $0.01238
07/28/2016 07/29/2016 $0.01171 $0.00 $0.00 $0.00 $0.01171
06/29/2016 06/30/2016 $0.01223 $0.00 $0.00 $0.00 $0.01223
05/27/2016 05/31/2016 $0.01371 $0.00 $0.00 $0.00 $0.01371
04/28/2016 04/29/2016 $0.01199 $0.00 $0.00 $0.00 $0.01199
03/30/2016 03/31/2016 $0.01372 $0.00 $0.00 $0.00 $0.01372
02/26/2016 02/29/2016 $0.01287 $0.00 $0.00 $0.00 $0.01287
01/28/2016 01/29/2016 $0.01155 $0.00 $0.00 $0.00 $0.01155
12/30/2015 12/31/2015 $0.01339 $0.00 $0.00 $0.00 $0.01339
11/27/2015 11/30/2015 $0.01456 $0.00 $0.00 $0.00 $0.01456
10/29/2015 10/30/2015 $0.01438 $0.00 $0.00 $0.00 $0.01438
09/29/2015 09/30/2015 $0.01387 $0.00 $0.00 $0.00 $0.01387
08/28/2015 08/31/2015 $0.01409 $0.00 $0.00 $0.00 $0.01409
07/30/2015 07/31/2015 $0.01432 $0.00 $0.00 $0.00 $0.01432
06/29/2015 06/30/2015 $0.01398 $0.00 $0.00 $0.00 $0.01398
05/28/2015 05/29/2015 $0.01343 $0.00 $0.00 $0.00 $0.01343
04/29/2015 04/30/2015 $0.01358 $0.00 $0.00 $0.00 $0.01358
03/30/2015 03/31/2015 $0.01539 $0.00 $0.00 $0.00 $0.01539
02/26/2015 02/27/2015 $0.01200 $0.00 $0.00 $0.00 $0.01200
01/29/2015 01/30/2015 $0.01284 $0.00 $0.00 $0.00 $0.01284
12/30/2014 12/31/2014 $0.01425 $0.00 $0.00 $0.00 $0.01425
11/26/2014 11/28/2014 $0.01241 $0.00 $0.00 $0.00 $0.01241
10/30/2014 10/31/2014 $0.01371 $0.00 $0.00 $0.00 $0.01371
09/29/2014 09/30/2014 $0.01302 $0.00 $0.00 $0.00 $0.01302
08/28/2014 08/29/2014 $0.01195 $0.00 $0.00 $0.00 $0.01195
07/30/2014 07/31/2014 $0.01355 $0.00 $0.00 $0.00 $0.01355
06/27/2014 06/30/2014 $0.01275 $0.00 $0.00 $0.00 $0.01275

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The Sextant Bond Income Fund intends to distribute its net investment income and net realized capital gains, if any, to its shareowners. The Fund pays income dividends daily, which are reinvested or distributed monthly. As a result of its investment strategy, the Fund expects that its dividends will consist primarily of ordinary income.

Distributions for the last two years are listed in the table above. For prior distributions, please contact a Saturna representative.

Regulations regarding distributions can be complex, and there are several methods for managing your tax liability. Please consult a tax advisor about your particular circumstances. You also may obtain helpful information by calling the Internal Revenue Service at 1-800-829-1040 or visiting

If applicable, distribution information will appear on Form 1099-DIV, typically sent in late January. For more information on tax documentation, please visit our Tax Documentation page.

The Fund pays per-share distributions to shareowners invested on the Record Date. On the Payable Date, the fund's share price is reduced by the amount of its distribution.

Fees and Expenses

The following tables describe the fees and expenses mutual fund shareowners may pay. There are no shareowner fees (fees paid directly from an investment). The Fund imposes no sales charge (load) on purchases or reinvested dividends, or any deferred sales charge (load) upon redemption. There are no exchange fees or account fees. Investments in mutual funds are subject to ongoing expenses. Saturna endeavors to keep these fees low. We encourage you to compare the following fees with similar fees of other no-load mutual funds:

Shareowner Fees (fees paid directly from your investment)
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price): 0%
Maximum Deferred Sales Charge (Load): 0%
Maximum Sales Charge (Load) Imposed on Reinvested Dividends/Distributions: 0%
Early Redemption Fee: 0%
Exchange Fee (between Saturna's affiliated funds): 0%
Maximum Account Fee: 0%
Annual Fund Operating Expenses (expenses deducted from Fund Assets)²
Sextant Bond Income SBIFX
Management Fees3 0.40%
Distribution (12b-1) Fees 0.25%
Other Expenses 0.38%
Total Annual Fund Operating Expenses3 1.03%
Fee Waiver and Expense Reimbursement -0.13%
Total Annual Fund Operating Expenses after Fee Waiver and Expense Reimbursement‡ 0.90%

‡The adviser has committed through March 31, 2016, to waive fees and/or reimburse expenses to the extent necessary to ensure that the Fund's net operating expenses, excluding brokerage commissions, interest, taxes, and extraordinary expenses do not exceed the net operating expense ratio of 0.90%. The committed net operating expense ratio may be changed or terminated only with approval of the Board of Trustees.

¹ A Fund's 30-Day Yield, sometimes referred to as "standardized yield" or "SEC yield,” is expressed as an annual percentage rate using a method of calculation adopted by the Securities and Exchange Commission (SEC). The 30-Day Yield provides an estimate of a Fund's investment income rate, but may not equal the actual income distribution rate.

² Expense ratios shown are as stated in the Fund's most recent prospectus or summary prospectus dated March 29, 2016.

³ Please see the Statement of Additional Information for the actual amount of fees paid to the adviser for the most recent fiscal year.

Performance data quoted represents past performance which is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be higher or lower than performance data quoted. Standardized returns current to the most recent month-end can be obtained by visiting our Month-End Returns Page or by calling toll free 1-800-SATURNA. The Fund cannot guarantee that its investment objective will be met. Securities of the Fund are offered and sold only through the prospectus or summary prospectus.

Check out the background of Saturna Brokerage Services, Inc. or any firm or investment professional on FINRA's BrokerCheck.