Idaho Tax-Exempt Fund
Overview
Investment Style
- Targeted to investors seeking income free from federal income, federal alternative minimum, and Idaho state income taxes
- Dollar-weighted average maturity between 6 and 15 years
- Investment grade municipal bonds, Idaho focused
- Diversified across industries and companies
- Actively managed by the award-winning, values-based, global expertise of Saturna Capital
Webinar Replay: September 15, 2021
State of the Municipal Market - Current Landscape and Themes for 2021
Investment Objective
Idaho Tax-Exempt Fund seeks to provide income free from federal income, federal alternative minimum, and Idaho state income taxes. Preservation of capital is a secondary objective.
Principal Investment Strategies
Idaho Tax-Exempt Fund invests in debt securities issued by the State of Idaho and its political subdivisions. These municipal bonds, notes, and commercial paper may be in various forms, including general obligation bonds, revenue bonds, mortgage bonds, certificates of participation, local improvement district bonds, and refunding bonds.
The Fund buys investment-grade bonds, meaning those rated BBB or higher by a national bond rating agency (e.g., Standard & Poor’s), or, if unrated, of equivalent quality in the opinion of the adviser, considered at the time of purchase. At least 40% of bonds that the Fund buys must be rated A or higher or, if unrated, of equivalent quality, on a similar basis. Factors used in bond evaluations include such information as the bond district’s financial position, population size, employment trends, economic activity, and diversification. The portfolio’s dollar-weighted average effective maturity is expected to range between 6 and 15 years. In accordance with the fundamental investment policies of the Fund, under normal circumstances, at least 80% of net assets are invested in debt securities generating income exempt from both federal and Idaho income tax.
Bonds subject to AMT do not count as satisfying the Fund’s requirement to invest 80% of its net assets in debt securities generating tax-exempt income.
Portfolio Managers
Portfolio Manager since 2020
Deputy Portfolio Manager since 2020
Performance
Short Term Performance
| As of February 28, 2023 | Ticker | 3 Month | 6 Month | YTD | |||
|---|---|---|---|---|---|---|---|
| Idaho Tax-Exempt | NITEX | 0.31% | 0.58% | -0.08% | |||
| S&P Idaho Municipal | 0.34% | 0.31% | 0.14% | ||||
Average Annual Total Returns
| Month-end, as of February 28, 2023 | Ticker | 1 Year | 3 Year | 5 Year | 10 Year | Expense Ratio² | 30-Day Yield¹ | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Idaho Tax-Exempt | NITEX | -2.97% | -1.20% | 1.39% | 1.53% | 0.67% | 1.84% | ||||
| S&P Idaho Municipal | -5.13% | -1.11% | 1.62% | 2.42% | n/a | n/a | |||||
| Quarter-end, as of December 31, 2022 | Ticker | 1 Year | 3 Year | 5 Year | 10 Year | Expense Ratio² | 30-Day Yield¹ | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Idaho Tax-Exempt | NITEX | -5.07% | -0.43% | 1.11% | 1.55% | 0.67% | 1.90% | ||||
| S&P Idaho Municipal | -7.86% | -0.46% | 1.34% | 2.48% | n/a | n/a | |||||
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 1-800-728-8762. 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.
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 30, 2022.
Growth 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.
The Standard and Poor's Idaho Municipal Bond Index is a broad-based index of Idaho municipal bond prices. Investors cannot invest directly in the index.
Distributions
| Record Date | Ex, Pay and Reinvest Date |
Ordinary Income |
Qualified Income |
Short-Term Capital Gains |
Long-Term Capital Gains |
Total Distributions (per share) |
|---|---|---|---|---|---|---|
| 03/30/2023 | 03/31/2023 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00689 |
| 02/27/2023 | 02/28/2023 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00733 |
| 01/30/2023 | 01/31/2023 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00859 |
| 12/29/2022 | 12/30/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.01016 |
| 11/29/2022 | 11/30/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00848 |
| 10/28/2022 | 10/31/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00815 |
| 09/29/2022 | 09/30/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00701 |
| 08/30/2022 | 08/31/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00807 |
| 07/28/2022 | 07/29/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00837 |
| 06/29/2022 | 06/30/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00815 |
| 05/27/2022 | 05/31/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00836 |
| 04/28/2022 | 04/29/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00765 |
| 03/30/2022 | 03/31/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00815 |
| 02/25/2022 | 02/28/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00733 |
| 01/28/2022 | 01/31/2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00752 |
| 12/30/2021 | 12/31/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00808 |
| 11/29/2021 | 11/30/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00792 |
| 10/28/2021 | 10/29/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00793 |
| 09/29/2021 | 09/30/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00724 |
| 08/30/2021 | 08/31/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00749 |
| 07/29/2021 | 07/30/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00796 |
| 06/29/2021 | 06/30/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00788 |
| 05/27/2021 | 05/28/2021 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00828 |
The Idaho Tax-Exempt Fund intends to distribute its net investment income and net realized capital gains, if any, to its shareowners. The Fund accounts for its distributions as taxable capital gains (originating from net realized gains on portfolio transactions), taxable ordinary income (originating from dividends, taxable interest, and certain other types of gains), or tax-exempt income (originating from interest on municipal bonds). Income dividends are paid daily and reinvested or distributed monthly. Distributions from capital gains (which may be taxable at different rates depending on the length of time the Fund holds its assets) are paid at the end of the year.
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 www.irs.gov.
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 & Minimums
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)
None.
| Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) | |
| Management Fees | 0.50% |
| Other Expenses | 0.17% |
| Total Annual Fund Operating Expenses | 0.67% |
When you buy shares through a financial intermediary, that intermediary may charge a transaction fee or commission which is not reflected in the expenses table. Purchases and redemptions of Fund shares will be made at the daily net asset value established by the Fund (before imposition of a commission).
Investment Minimum
The minimum initial investment is $1,000 (for tax-sheltered accounts, there is no minimum).
Principal Risks of Investing in the Fund
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. Consider investing in the Fund only if you are willing to accept the risk that you may lose money. Fund share prices, yields, and total returns will change with the fluctuations in the securities markets as well as the fortunes of the industries and companies in which the Fund invests.
Investment strategy risk: Because the Fund concentrates its investments primarily in Idaho municipal securities, its investments are susceptible to factors adversely affecting Idaho. These factors include economic and financial trends as well as political conditions in Idaho and its political subdivisions. Investing primarily in Idaho bonds means the Fund is less diversified than some other types of mutual funds. Concentrating investments in a single state or a small number of security issues may lead to underperformance compared to investments selected in greater number and/or from a wider universe.
Tax risk: The Fund is vulnerable to tax rate changes, either at the Idaho or federal level, since part of municipal securities’ value is derived from the recipient’s ability to exclude interest payments from taxation. Should this exclusion be reduced, the market for municipal securities, and consequently the Fund’s share value, may be adversely affected.
Interest rate risk: Changes in interest rates impact prices of fixed-income and related investments. When interest rates rise, the value of fixed-income investments (paying a lower rate of interest) generally will fall. Investments with shorter terms may have less interest rate risk, but generally have lower returns and, because of the more frequent maturity dates, may involve higher re-investment costs.
Call risk: Bonds with embedded callable options also contain an element of prepayment or call risk. When interest rates decline, issuers can retire their debt and reissue bonds at a lower interest rate.
Credit risk: Corporate and sovereign issuers of the notes and certificates in which the Fund invests may not be able or willing to make payments when due, which may lead to default or restructuring of the investment. In addition, if the market perceives deterioration in the creditworthiness of an issuer, the value and liquidity of the issuer’s securities may 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.