ETF Evaluator: Northern Trust Disciplined Dur MBS ETF (MBSD) Follow This ETF

Northern Trust Disciplined Dur MBS ETF Overview

Northern Trust Disciplined Dur MBS ETF (MBSD) is a passively managed Taxable Bond Government Mortgage-Backed Bond exchange-traded fund (ETF). Northern Trust launched the ETF in 2014.

The investment seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the ICE ® BofA ® Constrained Duration U.S. Mortgage Backed Securities Index. The underlying index reflects the performance of a selection of investment-grade U.S. agency residential mortgage backed pass-through securities. The fund generally will invest under normal circumstances at least 80% of its total assets (exclusive of collateral held from securities lending) in the securities of the underlying index and in "TBA Transactions" that represent securities in the underlying index.

About Northern Trust Disciplined Dur MBS ETF (MBSD)

There are 4 members of the management team with an average tenure of 5.71 years: David Alongi (2021), Michael Chico (2020), Dmitri Artemiev (2025) and Kevin O'Shaughnessy (2016). Management tenure is more important for actively managed ETFs than passive index ETFs.

The ETF has 2 primary benchmarks: Bloomberg US Agg Bond TR USD index with a weighting of 100% and Bloomberg US MBS TR USD index with a weighting of 100%. Northern Trust Disciplined Dur MBS ETF has 469 securities in its portfolio. The top 10 holdings constitute 17.3% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a diversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.

Northern Trust Disciplined Dur MBS ETF is part of the Fixed Income global asset class and is within the Taxable Bond ETF group. Northern Trust Disciplined Dur MBS ETF has 0.0% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 0.0% There is 0.0% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 89.8% (89.8% domestic bond, 0.0% foreign bond and 0.0% convertible bond). Northern Trust Disciplined Dur MBS ETF has 10.2% of the portfolio in cash.

Assets Under Management

The fund has $86 million in total assets, which is below the $5 billion average for the Government Mortgage-Backed Bond category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

MBSD Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Northern Trust Disciplined Dur MBS ETF expense ratio is below average compared to funds in the Government Mortgage-Backed Bond category. Northern Trust Disciplined Dur MBS ETF has an expense ratio of 0.20%, which is 19% lower than its category average, making the fund expense ratio grade a B. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. Northern Trust Disciplined Dur MBS ETF has a portfolio turnover rate of 38%, which indicates that it holds its assets around / 0.0 years. By way of comparison, the average portfolio turnover is 274% for the Government Mortgage-Backed Bond category.

Recently, in the month of September 2026, Northern Trust Disciplined Dur MBS ETF returned -2.4%, which earned it a grade of A, as the Government Mortgage-Backed Bond category had an average return of -3.3%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.

Northern Trust Disciplined Dur MBS ETF has a trailing yield of 4.26%, which is below the 4.79% category average. The fund normally distributes its income monthly.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

Northern Trust Disciplined Dur MBS ETF Grades

Year to date, the ETF has returned -2.2%, 0.6 percentage points better than the category, which translates into a grade of A. The fund has returned -0.8% over the past year (grade of A), 4.1% over the past three years (grade of F) and 0.1% per year over the past five years (grade of A) and 1.0% per year over the past 10 years (grade of A).

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