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Is Nuveen ESG Large-Cap Growth ETF (NULG) a Strong ETF Right Now?
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The Nuveen ESG Large-Cap Growth ETF (NULG - Free Report) made its debut on 12/13/2016, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Growth category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader 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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Nuveen, NULG has amassed assets over $1.21 billion, making it one of the average sized ETFs in the Style Box - Large Cap Growth. NULG, before fees and expenses, seeks to match the performance of the TIAA ESG USA Large-Cap Growth Index.
The TIAA ESG USA Large-Cap Growth Index is comprised of equity securities of large capitalization companies listed on US exchanges & meet ESG criteria & exhibit overall growth style characteristics based on long-term forward EPS growth rate, short-term forward EPS growth rate, current internal growth rate, long-term historical EPS growth trend & long-term historical sales per share growth trend.
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 0.26%.
It's 12-month trailing dividend yield comes in at 0.37%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector - about 39.90% of the portfolio. Consumer Discretionary and Healthcare round out the top three.
Taking into account individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 12.05% of the fund's total assets, followed by Nvidia Corp (NVDA - Free Report) and Tesla Inc (TSLA - Free Report) .
The top 10 holdings account for about 39.66% of total assets under management.
Performance and Risk
So far this year, NULG has gained about 42.21%, and is up about 42.24% in the last one year (as of 12/26/2023). During this past 52-week period, the fund has traded between $47.93 and $69.27.
NULG has a beta of 1.12 and standard deviation of 22.55% for the trailing three-year period. With about 112 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Large-Cap Growth ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
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 $8.28 billion in assets, iShares ESG Aware MSCI USA ETF has $13.28 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 - Large 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 Large-Cap Growth ETF (NULG) a Strong ETF Right Now?
The Nuveen ESG Large-Cap Growth ETF (NULG - Free Report) made its debut on 12/13/2016, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Growth category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader 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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Nuveen, NULG has amassed assets over $1.21 billion, making it one of the average sized ETFs in the Style Box - Large Cap Growth. NULG, before fees and expenses, seeks to match the performance of the TIAA ESG USA Large-Cap Growth Index.
The TIAA ESG USA Large-Cap Growth Index is comprised of equity securities of large capitalization companies listed on US exchanges & meet ESG criteria & exhibit overall growth style characteristics based on long-term forward EPS growth rate, short-term forward EPS growth rate, current internal growth rate, long-term historical EPS growth trend & long-term historical sales per share growth trend.
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 0.26%.
It's 12-month trailing dividend yield comes in at 0.37%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector - about 39.90% of the portfolio. Consumer Discretionary and Healthcare round out the top three.
Taking into account individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 12.05% of the fund's total assets, followed by Nvidia Corp (NVDA - Free Report) and Tesla Inc (TSLA - Free Report) .
The top 10 holdings account for about 39.66% of total assets under management.
Performance and Risk
So far this year, NULG has gained about 42.21%, and is up about 42.24% in the last one year (as of 12/26/2023). During this past 52-week period, the fund has traded between $47.93 and $69.27.
NULG has a beta of 1.12 and standard deviation of 22.55% for the trailing three-year period. With about 112 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG Large-Cap Growth ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
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 $8.28 billion in assets, iShares ESG Aware MSCI USA ETF has $13.28 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 - Large 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.