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Is Nuveen ESG Large-Cap Value ETF (NULV) a Strong ETF Right Now?
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Designed to provide broad exposure to the Style Box - Large Cap Value category of the market, the Nuveen ESG Large-Cap Value ETF (NULV - Free Report) is a smart beta exchange traded fund launched on 12/13/2016.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Nuveen, and has been able to amass over $1.46 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, this particular fund seeks to match the performance of the TIAA ESG USA Large-Cap Value Index.
The TIAA ESG USA Large-Cap Value Index comprises of equity securities issued by large capitalization companies listed on US exchanges. It uses a rules-based methodology that seeks to provide investment exposure generally replicating large-cap value benchmarks through a portfolio of securities adhering to predetermined ESG, controversial business involvement & low-carbon criteria.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for NULV are 0.26%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 2.20%.
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.
Representing 18.90% of the portfolio, the fund has heaviest allocation to the Financials sector; Healthcare and Consumer Staples round out the top three.
Looking at individual holdings, Jpmorgan Chase & Co (JPM - Free Report) accounts for about 2.87% of total assets, followed by Merck & Co. Inc. (MRK - Free Report) and Coca-Cola Co/the (KO - Free Report) .
NULV's top 10 holdings account for about 23.43% of its total assets under management.
Performance and Risk
Year-to-date, the Nuveen ESG Large-Cap Value ETF has lost about -3.59% so far, and is down about -8.30% over the last 12 months (as of 05/30/2023). NULV has traded between $30.87 and $36.66 in this past 52-week period.
The ETF has a beta of 0.92 and standard deviation of 17.07% for the trailing three-year period. With about 97 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Large-Cap Value ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
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 $7.27 billion in assets, iShares ESG Aware MSCI USA ETF has $13.56 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 - Large 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 Large-Cap Value ETF (NULV) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - Large Cap Value category of the market, the Nuveen ESG Large-Cap Value ETF (NULV - Free Report) is a smart beta exchange traded fund launched on 12/13/2016.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Nuveen, and has been able to amass over $1.46 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, this particular fund seeks to match the performance of the TIAA ESG USA Large-Cap Value Index.
The TIAA ESG USA Large-Cap Value Index comprises of equity securities issued by large capitalization companies listed on US exchanges. It uses a rules-based methodology that seeks to provide investment exposure generally replicating large-cap value benchmarks through a portfolio of securities adhering to predetermined ESG, controversial business involvement & low-carbon criteria.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for NULV are 0.26%, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 2.20%.
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.
Representing 18.90% of the portfolio, the fund has heaviest allocation to the Financials sector; Healthcare and Consumer Staples round out the top three.
Looking at individual holdings, Jpmorgan Chase & Co (JPM - Free Report) accounts for about 2.87% of total assets, followed by Merck & Co. Inc. (MRK - Free Report) and Coca-Cola Co/the (KO - Free Report) .
NULV's top 10 holdings account for about 23.43% of its total assets under management.
Performance and Risk
Year-to-date, the Nuveen ESG Large-Cap Value ETF has lost about -3.59% so far, and is down about -8.30% over the last 12 months (as of 05/30/2023). NULV has traded between $30.87 and $36.66 in this past 52-week period.
The ETF has a beta of 0.92 and standard deviation of 17.07% for the trailing three-year period. With about 97 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Large-Cap Value ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
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 $7.27 billion in assets, iShares ESG Aware MSCI USA ETF has $13.56 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 - Large 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.