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Is Nuveen ESG International Developed Markets Equity ETF (NUDM) a Strong ETF Right Now?
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A smart beta exchange traded fund, the Nuveen ESG International Developed Markets Equity ETF (NUDM - Free Report) debuted on 06/07/2017, and offers broad exposure to the Broad Developed World ETFs 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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track 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
NUDM is managed by Nuveen, and this fund has amassed over $407.88 million, which makes it one of the average sized ETFs in the Broad Developed World ETFs. This particular fund seeks to match the performance of the TIAA ESG International Developed Markets Equity Index before fees and expenses.
The TIAA ESG International Developed Markets Equity Index uses a rules-based methodology to arrive at a diversified portfolio of equity securities issued by companies located in countries with developed markets, excluding the U.S. and Canada, that adhere to predetermined ESG, controversial business involvement and 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 NUDM are 0.31%, which makes it on par with most peer products in the space.
NUDM's 12-month trailing dividend yield is 2.99%.
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.
When you look at individual holdings, Asml Holding Nv /eur/ accounts for about 3.17% of the fund's total assets, followed by Novo Nordisk A/s-B /dkk/ and Novartis Ag-Reg /chf/.
The top 10 holdings account for about 21.18% of total assets under management.
Performance and Risk
Year-to-date, the Nuveen ESG International Developed Markets Equity ETF has added roughly 5.03% so far, and is up about 16.14% over the last 12 months (as of 03/08/2024). NUDM has traded between $25.86 and $30.90 in this past 52-week period.
The ETF has a beta of 0.89 and standard deviation of 16.72% for the trailing three-year period. With about 155 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG International Developed Markets Equity ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs 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 $11.03 billion in assets, iShares ESG Aware MSCI USA ETF has $13.66 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 Broad Developed World 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 International Developed Markets Equity ETF (NUDM) a Strong ETF Right Now?
A smart beta exchange traded fund, the Nuveen ESG International Developed Markets Equity ETF (NUDM - Free Report) debuted on 06/07/2017, and offers broad exposure to the Broad Developed World ETFs 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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track 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
NUDM is managed by Nuveen, and this fund has amassed over $407.88 million, which makes it one of the average sized ETFs in the Broad Developed World ETFs. This particular fund seeks to match the performance of the TIAA ESG International Developed Markets Equity Index before fees and expenses.
The TIAA ESG International Developed Markets Equity Index uses a rules-based methodology to arrive at a diversified portfolio of equity securities issued by companies located in countries with developed markets, excluding the U.S. and Canada, that adhere to predetermined ESG, controversial business involvement and 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 NUDM are 0.31%, which makes it on par with most peer products in the space.
NUDM's 12-month trailing dividend yield is 2.99%.
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.
When you look at individual holdings, Asml Holding Nv /eur/ accounts for about 3.17% of the fund's total assets, followed by Novo Nordisk A/s-B /dkk/ and Novartis Ag-Reg /chf/.
The top 10 holdings account for about 21.18% of total assets under management.
Performance and Risk
Year-to-date, the Nuveen ESG International Developed Markets Equity ETF has added roughly 5.03% so far, and is up about 16.14% over the last 12 months (as of 03/08/2024). NUDM has traded between $25.86 and $30.90 in this past 52-week period.
The ETF has a beta of 0.89 and standard deviation of 16.72% for the trailing three-year period. With about 155 holdings, it effectively diversifies company-specific risk.
Alternatives
Nuveen ESG International Developed Markets Equity ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs 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 $11.03 billion in assets, iShares ESG Aware MSCI USA ETF has $13.66 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 Broad Developed World 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.