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Is Nuveen ESG Mid-Cap Growth ETF (NUMG) a Strong ETF Right Now?

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Launched on 12/13/2016, the Nuveen ESG Mid-Cap Growth ETF (NUMG - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Mid Cap Growth 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.

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.

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

NUMG is managed by Nuveen, and this fund has amassed over $448.77 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Growth. Before fees and expenses, NUMG seeks to match the performance of the TIAA ESG USA Mid-Cap Growth Index.

The Nuveen ESG USA Mid-Cap Growth Index composes of equity securities issued by mid-capitalization companies listed on U.S. exchanges.

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 0.31% for NUMG, making it on par with most peer products in the space.

The fund has a 12-month trailing dividend yield of 0.05%.

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 31.90% of the portfolio --while Industrials and Consumer Discretionary round out the top three.

When you look at individual holdings, Royal Caribbean Cruises (RCL - Free Report) accounts for about 4.62% of the fund's total assets, followed by Quanta Services Inc. (PWR - Free Report) and Fair Isaac Corp (FICO - Free Report) .

Its top 10 holdings account for approximately 36.73% of NUMG's total assets under management.

Performance and Risk

The ETF has added roughly 5.13% and was up about 16.75% so far this year and in the past one year (as of 01/30/2025), respectively. NUMG has traded between $39.43 and $51.47 during this last 52-week period.

NUMG has a beta of 1.13 and standard deviation of 23.29% for the trailing three-year period. With about 42 holdings, it has more concentrated exposure than peers.

Alternatives

Nuveen ESG Mid-Cap Growth ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.

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 $14.20 billion in assets, JPMorgan Nasdaq Equity Premium Income ETF has $22.24 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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