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Is Nuveen ESG Mid-Cap Growth ETF (NUMG) a Strong ETF Right Now?
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Making its debut on 12/13/2016, smart beta exchange traded fund Nuveen ESG Mid-Cap Growth ETF (NUMG - Free Report) provides investors broad exposure to the Style Box - Mid Cap Growth category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
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.
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
The fund is managed by Nuveen, and has been able to amass over $400.35 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Growth. NUMG seeks to match the performance of the TIAA ESG USA Mid-Cap Growth Index before fees and expenses.
The TIAA ESG USA Mid-Cap Growth Index comprises of equity securities issued by mid- capitalization companies listed on US exchanges. It uses a rules-based methodology that provides investment exposure that generally replicates that of mid-cap growth benchmarks through a portfolio of securities that adhere to predetermined ESG, controversial business involvement and low-carbon screening 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 NUMG are 0.31%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.17%.
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.
For NUMG, it has heaviest allocation in the Information Technology sector --about 31.80% of the portfolio --while Industrials and Healthcare round out the top three.
When you look at individual holdings, Trade Desk Inc/the (TTD - Free Report) accounts for about 3.71% of the fund's total assets, followed by Fair Isaac Corp (FICO - Free Report) and Grainger W.w. Inc. (GWW - Free Report) .
The top 10 holdings account for about 31.65% of total assets under management.
Performance and Risk
The ETF has gained about 4.95% so far this year and it's up approximately 21.88% in the last one year (as of 09/24/2024). In the past 52-week period, it has traded between $33.95 and $44.69.
NUMG has a beta of 1.10 and standard deviation of 24.03% for the trailing three-year period. With about 47 holdings, it has more concentrated exposure than peers.
Alternatives
Nuveen ESG Mid-Cap Growth ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index and the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ - Free Report) tracks ----------------------------------------. IShares ESG Aware MSCI USA ETF has $13.34 billion in assets, JPMorgan Nasdaq Equity Premium Income ETF has $16.41 billion. ESGU has an expense ratio of 0.15% and JEPQ charges 0.35%.
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 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 Mid-Cap Growth ETF (NUMG) a Strong ETF Right Now?
Making its debut on 12/13/2016, smart beta exchange traded fund Nuveen ESG Mid-Cap Growth ETF (NUMG - Free Report) provides investors broad exposure to the Style Box - Mid Cap Growth category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
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.
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
The fund is managed by Nuveen, and has been able to amass over $400.35 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Growth. NUMG seeks to match the performance of the TIAA ESG USA Mid-Cap Growth Index before fees and expenses.
The TIAA ESG USA Mid-Cap Growth Index comprises of equity securities issued by mid- capitalization companies listed on US exchanges. It uses a rules-based methodology that provides investment exposure that generally replicates that of mid-cap growth benchmarks through a portfolio of securities that adhere to predetermined ESG, controversial business involvement and low-carbon screening 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 NUMG are 0.31%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.17%.
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.
For NUMG, it has heaviest allocation in the Information Technology sector --about 31.80% of the portfolio --while Industrials and Healthcare round out the top three.
When you look at individual holdings, Trade Desk Inc/the (TTD - Free Report) accounts for about 3.71% of the fund's total assets, followed by Fair Isaac Corp (FICO - Free Report) and Grainger W.w. Inc. (GWW - Free Report) .
The top 10 holdings account for about 31.65% of total assets under management.
Performance and Risk
The ETF has gained about 4.95% so far this year and it's up approximately 21.88% in the last one year (as of 09/24/2024). In the past 52-week period, it has traded between $33.95 and $44.69.
NUMG has a beta of 1.10 and standard deviation of 24.03% for the trailing three-year period. With about 47 holdings, it has more concentrated exposure than peers.
Alternatives
Nuveen ESG Mid-Cap Growth ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index and the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ - Free Report) tracks ----------------------------------------. IShares ESG Aware MSCI USA ETF has $13.34 billion in assets, JPMorgan Nasdaq Equity Premium Income ETF has $16.41 billion. ESGU has an expense ratio of 0.15% and JEPQ charges 0.35%.
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 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.