Designed to provide broad exposure to the Style Box - Large Cap Value category of the market, the Nuveen ESG Large-Cap Value ETF (NULV) is a smart beta exchange traded fund launched on 12/13/2016.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
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.
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.
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.
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
The fund is managed by Nuveen, and has been able to amass over $2.27 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 Nuveen ESG USA Large-Cap Value Index composes of equity securities issued by large capitalization companies listed on U.S. exchanges.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.26%.
The fund has a 12-month trailing dividend yield of 1.38%.
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.
Representing 24.6% of the portfolio, the fund has heaviest allocation to the Information Technology sector; Financials and Healthcare round out the top three.
Taking into account individual holdings, Microsoft Corp (MSFT) accounts for about 7.38% of the fund's total assets, followed by Meta Platforms Inc (META) and Cisco Systems Inc. (CSCO).
Its top 10 holdings account for approximately 27.96% of NULV's total assets under management.
Performance and Risk
The ETF has added about 19.02% so far this year and is up about 26.12% in the last one year (as of 08/26/2026). In the past 52-week period, it has traded between $42.81 and $53.91
NULV has a beta of 0.85 and standard deviation of 12.32% for the trailing three-year period. With about 102 holdings, it effectively diversifies company-specific risk .
Alternatives
Nuveen ESG Large-Cap Value ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard ESG U.S. Stock ETF Shares (ESGV) tracks FTSE US ALL CAP CHOICE INDEX and the iShares ESG Aware MSCI USA ETF (ESGU) tracks MSCI USA ESG Focus Index. Vanguard ESG U.S. Stock ETF Shares has $13.53 billion in assets, iShares ESG Aware MSCI USA ETF has $18.11 billion. ESGV has an expense ratio of 0.09% and ESGU changes 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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Nuveen ESG Large-Cap Value ETF (NULV): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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