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Is Nuveen ESG Emerging Markets Equity ETF (NUEM) a Strong ETF Right Now?
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Making its debut on 06/07/2017, smart beta exchange traded fund Nuveen ESG Emerging Markets Equity ETF (NUEM - Free Report) provides investors broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by Nuveen, NUEM has amassed assets over $217.69 million, making it one of the average sized ETFs in the Broad Emerging Market ETFs. Before fees and expenses, NUEM seeks to match the performance of the TIAA ESG Emerging Markets Equity Index.
The TIAA ESG Emerging Markets Equity Index uses a rules-based methodology to arrive at a diversified portfolio of equity securities issued by companies located in countries with emerging markets that adhere to predetermined ESG, controversial business involvement and low-carbon 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.
Operating expenses on an annual basis are 0.35% for NUEM, making it on par with most peer products in the space.
NUEM's 12-month trailing dividend yield is 1.89%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Taking into account individual holdings, Taiwan Semiconductor Man /twd/ accounts for about 7.10% of the fund's total assets, followed by Tencent Holdings Ltd /hkd/ and Alibaba Group Holding Lt /hkd/.
NUEM's top 10 holdings account for about 22.32% of its total assets under management.
Performance and Risk
So far this year, NUEM has gained about 0.90%, and is down about -12.91% in the last one year (as of 03/20/2023). During this past 52-week period, the fund has traded between $22.51 and $31.52.
The ETF has a beta of 0.73 and standard deviation of 22.23% for the trailing three-year period. With about 220 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Emerging Markets Equity ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs 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 $6.77 billion in assets, iShares ESG Aware MSCI USA ETF has $18.97 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 Broad Emerging Market ETFs.
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 Emerging Markets Equity ETF (NUEM) a Strong ETF Right Now?
Making its debut on 06/07/2017, smart beta exchange traded fund Nuveen ESG Emerging Markets Equity ETF (NUEM - Free Report) provides investors broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by Nuveen, NUEM has amassed assets over $217.69 million, making it one of the average sized ETFs in the Broad Emerging Market ETFs. Before fees and expenses, NUEM seeks to match the performance of the TIAA ESG Emerging Markets Equity Index.
The TIAA ESG Emerging Markets Equity Index uses a rules-based methodology to arrive at a diversified portfolio of equity securities issued by companies located in countries with emerging markets that adhere to predetermined ESG, controversial business involvement and low-carbon 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.
Operating expenses on an annual basis are 0.35% for NUEM, making it on par with most peer products in the space.
NUEM's 12-month trailing dividend yield is 1.89%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Taking into account individual holdings, Taiwan Semiconductor Man /twd/ accounts for about 7.10% of the fund's total assets, followed by Tencent Holdings Ltd /hkd/ and Alibaba Group Holding Lt /hkd/.
NUEM's top 10 holdings account for about 22.32% of its total assets under management.
Performance and Risk
So far this year, NUEM has gained about 0.90%, and is down about -12.91% in the last one year (as of 03/20/2023). During this past 52-week period, the fund has traded between $22.51 and $31.52.
The ETF has a beta of 0.73 and standard deviation of 22.23% for the trailing three-year period. With about 220 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Emerging Markets Equity ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs 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 $6.77 billion in assets, iShares ESG Aware MSCI USA ETF has $18.97 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 Broad Emerging Market ETFs.
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.