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Is Nuveen ESG Mid-Cap Value ETF (NUMV) a Strong ETF Right Now?
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Launched on 12/13/2016, the Nuveen ESG Mid-Cap Value ETF (NUMV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Mid Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by Nuveen, and has been able to amass over $344.45 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the TIAA ESG USA Mid-Cap Value Index.
The TIAA ESG USA Mid-Cap Value Index comprises of equity securities issued by mid- capitalization companies listed on US exchanges. It uses a rules-based methodology that seeks to provide investment exposure that generally replicates mid-cap value benchmarks through a portfolio of securities that adhere to predetermined ESG, controversial business involvement and low-carbon screening criteria.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.31%.
It has a 12-month trailing dividend yield of 2.06%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Representing 17.80% of the portfolio, the fund has heaviest allocation to the Industrials sector; Financials and Consumer Discretionary round out the top three.
When you look at individual holdings, United Rentals Inc (URI - Free Report) accounts for about 2.49% of the fund's total assets, followed by Ferguson Plc and Oneok Inc (OKE - Free Report) .
The top 10 holdings account for about 20.49% of total assets under management.
Performance and Risk
The ETF has gained about 7.07% and is up about 22% so far this year and in the past one year (as of 04/09/2024), respectively. NUMV has traded between $26.41 and $34.20 during this last 52-week period.
The fund has a beta of 1.10 and standard deviation of 18.66% for the trailing three-year period. With about 88 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Mid-Cap Value ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
JPMorgan Nasdaq Equity Premium Income ETF (JEPQ - Free Report) tracks ---------------------------------------- and the iShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index. JPMorgan Nasdaq Equity Premium Income ETF has $12 billion in assets, iShares ESG Aware MSCI USA ETF has $12.59 billion. JEPQ has an expense ratio of 0.35% 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 Value.
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 Mid-Cap Value ETF (NUMV) a Strong ETF Right Now?
Launched on 12/13/2016, the Nuveen ESG Mid-Cap Value ETF (NUMV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Mid Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by Nuveen, and has been able to amass over $344.45 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the TIAA ESG USA Mid-Cap Value Index.
The TIAA ESG USA Mid-Cap Value Index comprises of equity securities issued by mid- capitalization companies listed on US exchanges. It uses a rules-based methodology that seeks to provide investment exposure that generally replicates mid-cap value benchmarks through a portfolio of securities that adhere to predetermined ESG, controversial business involvement and low-carbon screening criteria.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.31%.
It has a 12-month trailing dividend yield of 2.06%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Representing 17.80% of the portfolio, the fund has heaviest allocation to the Industrials sector; Financials and Consumer Discretionary round out the top three.
When you look at individual holdings, United Rentals Inc (URI - Free Report) accounts for about 2.49% of the fund's total assets, followed by Ferguson Plc and Oneok Inc (OKE - Free Report) .
The top 10 holdings account for about 20.49% of total assets under management.
Performance and Risk
The ETF has gained about 7.07% and is up about 22% so far this year and in the past one year (as of 04/09/2024), respectively. NUMV has traded between $26.41 and $34.20 during this last 52-week period.
The fund has a beta of 1.10 and standard deviation of 18.66% for the trailing three-year period. With about 88 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Mid-Cap Value ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
JPMorgan Nasdaq Equity Premium Income ETF (JEPQ - Free Report) tracks ---------------------------------------- and the iShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index. JPMorgan Nasdaq Equity Premium Income ETF has $12 billion in assets, iShares ESG Aware MSCI USA ETF has $12.59 billion. JEPQ has an expense ratio of 0.35% 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 Value.
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.