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Is Nuveen ESG MidCap Growth ETF (NUMG) a Strong ETF Right Now?
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A smart beta exchange traded fund, the Nuveen ESG MidCap Growth ETF (NUMG - Free Report) debuted on 12/13/2016, and offers broad exposure to the Style Box - Mid Cap Growth category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is sponsored by Nuveen. It has amassed assets over $315.99 million, making it one of the average sized ETFs in the Style Box - Mid Cap Growth. NUMG, before fees and expenses, seeks to match the performance of the TIAA ESG USA Mid-Cap Growth Index.
The TIAA ESG USA Mid-Cap Growth Index comprises of equity securities issued by mid- capitalization companies listed on US exchanges. It uses a rules-based methodology that provides investment exposure that generally replicates that of mid-cap growth benchmarks through a portfolio of securities that adhere to predetermined ESG, controversial business involvement and low-carbon screening criteria.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.30%.
It's 12-month trailing dividend yield comes in at 17.87%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector - about 33.40% of the portfolio. Healthcare and Industrials round out the top three.
When you look at individual holdings, Cadence Design Sys Inc (CDNS - Free Report) accounts for about 3.54% of the fund's total assets, followed by Cheniere Energy Inc (LNG - Free Report) and Mettler-Toledo International (MTD - Free Report) .
The top 10 holdings account for about 26.7% of total assets under management.
Performance and Risk
So far this year, NUMG has lost about -27.86%, and is down about -23.21% in the last one year (as of 07/18/2022). During this past 52-week period, the fund has traded between $32.84 and $59.46.
NUMG has a beta of 1.11 and standard deviation of 26.92% for the trailing three-year period. With about 58 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG MidCap Growth ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI EAFE ETF (ESGD - Free Report) tracks MSCI EAFE ESG Focus Index and the iShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index. IShares ESG Aware MSCI EAFE ETF has $6.36 billion in assets, iShares ESG Aware MSCI USA ETF has $21.61 billion. ESGD has an expense ratio of 0.20% and ESGU charges 0.15%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap Growth.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Is Nuveen ESG MidCap Growth ETF (NUMG) a Strong ETF Right Now?
A smart beta exchange traded fund, the Nuveen ESG MidCap Growth ETF (NUMG - Free Report) debuted on 12/13/2016, and offers broad exposure to the Style Box - Mid Cap Growth category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is sponsored by Nuveen. It has amassed assets over $315.99 million, making it one of the average sized ETFs in the Style Box - Mid Cap Growth. NUMG, before fees and expenses, seeks to match the performance of the TIAA ESG USA Mid-Cap Growth Index.
The TIAA ESG USA Mid-Cap Growth Index comprises of equity securities issued by mid- capitalization companies listed on US exchanges. It uses a rules-based methodology that provides investment exposure that generally replicates that of mid-cap growth benchmarks through a portfolio of securities that adhere to predetermined ESG, controversial business involvement and low-carbon screening criteria.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.30%.
It's 12-month trailing dividend yield comes in at 17.87%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector - about 33.40% of the portfolio. Healthcare and Industrials round out the top three.
When you look at individual holdings, Cadence Design Sys Inc (CDNS - Free Report) accounts for about 3.54% of the fund's total assets, followed by Cheniere Energy Inc (LNG - Free Report) and Mettler-Toledo International (MTD - Free Report) .
The top 10 holdings account for about 26.7% of total assets under management.
Performance and Risk
So far this year, NUMG has lost about -27.86%, and is down about -23.21% in the last one year (as of 07/18/2022). During this past 52-week period, the fund has traded between $32.84 and $59.46.
NUMG has a beta of 1.11 and standard deviation of 26.92% for the trailing three-year period. With about 58 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG MidCap Growth ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI EAFE ETF (ESGD - Free Report) tracks MSCI EAFE ESG Focus Index and the iShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index. IShares ESG Aware MSCI EAFE ETF has $6.36 billion in assets, iShares ESG Aware MSCI USA ETF has $21.61 billion. ESGD has an expense ratio of 0.20% and ESGU charges 0.15%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap Growth.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.