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Is Nuveen International Growth A (NBQAX) a Strong Mutual Fund Pick Right Now?

Zacks Equity Research

If you're looking for a Non US - Equity fund category, then a potential option is Nuveen International Growth A (NBQAX). NBQAX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We classify NBQAX in the Non US - Equity category, which is an area rife with potential choices. Investing in companies outside the United States is how Non US - Equity funds set themselves apart, since global funds tend to keep a good portion of their portfolio stateside. Many of these funds like to allocate across emerging and developed markets, and will often focus on all cap levels.

History of Fund/Manager

Nuveen is based in Chicago, IL, and is the manager of NBQAX. Since Nuveen International Growth A made its debut in June of 2010, NBQAX has garnered more than $45.74 million in assets. Joseph R. O'Flaherty is the fund's current manager and has held that role since October of 2017.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. NBQAX has a 5-year annualized total return of 6.17% and it sits 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 12.52%, 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. Looking at the past 5 years, the fund's standard deviation is 14.13% compared to the category average of 1.25%. 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.

Investors should note that the fund has a 5-year beta of 0.99, so it is likely going to be as volatile as the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. The fund has produced a negative alpha over the past 5 years of -4.59, which shows that 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, NBQAX is a load fund and it has an expense ratio of 1.13%.

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

Bottom Line

With a rank of 'hold' we aren't getting a good signal one way or another on NBQAX. That is why it might be a good idea to consider other items, such as the fund's expense ratio of 1.13%, and how this compares to other potential options being considered for investment. If cheaper, it might make a decent choice, but a more expensive fund might be worth avoiding. Just make sure to pay attention to its rank in case it shifts in the near future.

For additional information on the Non US - Equity area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into NBQAX too for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.


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