Markets

Is Nuveen Large Cap Value A (NNGAX) a Strong Mutual Fund Pick Right Now?

A generic image of a person on their laptop
Credit: Shutterstock photo

Having trouble finding a Large Cap Value fund? Nuveen Large Cap Value A (NNGAX) is a potential starting point. NNGAX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

Large Cap Value mutual funds invest in stocks with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value; this value investing strategy often leads to low P/E ratios and high dividend yields, though growth levels are often curtailed. The high-growth opportunity of these funds are slowed even further, as large-cap securities are generally in stable industries with low to moderate growth prospects. Therefore, Large Cap Value funds are usually more appealing to investors who are interested in a stable income stream.

History of Fund/Manager

Nuveen is based in Chicago, IL, and is the manager of NNGAX. Nuveen Large Cap Value A debuted in August of 1996. Since then, NNGAX has accumulated assets of about $293.66 million, according to the most recently available information. Robert C. Doll Jr is the fund's current manager and has held that role since June of 2013.

Performance

Investors naturally seek funds with strong performance. NNGAX has a 5-year annualized total return of 8.15% and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 10.5%, which places it in the top third during this time-frame.

When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. The standard deviation of NNGAX over the past three years is 12.2% compared to the category average of 8.96%. The fund's standard deviation over the past 5 years is 12.06% compared to the category average of 9.19%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. In NNGAX's case, the fund lost 50.96% in the most recent bear market and underperformed its peer group by 0.26%. This means that the fund could possibly be a worse choice than its peers during a down market environment.

Nevertheless, investors should also note that the fund has a 5-year beta of 1.09, which means it is hypothetically more volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. With a negative alpha of -3.37, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, NNGAX is a load fund. It has an expense ratio of 1.03% compared to the category average of 1.03%. NNGAX is actually more expensive than its peers when you consider factors like cost.

Investors should also note that the minimum initial investment for the product is $3,000 and that each subsequent investment needs to be at $100.

Bottom Line

Overall, Nuveen Large Cap Value A ( NNGAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, this fund looks like a good potential choice for investors right now.

Want even more information about NNGAX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Get Your Free (NNGAX): Fund Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

NNGAX

Other Topics

Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More