Nuveen Mortgage Opportunity Term Fund 2 of Beneficial InterestFind Ratings Reports
- Last Ratings Update:02/28/2018
- Price as of 02/28/2018 :$22.90
- Net Assets:$116.33 Million
- Peer Rank:4 of 14
- Investment Rating:B
We rate Nuveen Mortgage Opportunity Term 2 at B. Positive factors that influence this rating include a well above average total return. The fund invests approximately 82% of its assets in bonds and may be considered for investors seeking a General Mortgage strategy.
POSITIVES AND RISKS
Total return ranks very high in comparison with peers over the last three years. The Nuveen Mortgage Opportunity Term 2 has returned an annual rate of 8.19% since inception. More recently, the fund has generated a total return of 4.59% in the last five years, 9.56% in the last three years, and 9.70% in the last year. How does that compare to other equity funds? In the last five years, it has outperformed 50% of them. It has also outpaced 75% of its competitors on a three year basis and 54% of them over the last year for the period ending 2/28/2018. On a year to date basis, JMT has returned -3.23%.
Downside risk has been below average. JMT has a draw down risk of -7.81%, which is the largest price decline experienced over the last three years. This fund has a three year standard deviation of 5.0%. This fund has had very little volatility in its monthly performance over the last 36 months. As of 2/28/2018, the fund was trading at a price of $22.90, which is 2.4% below its 52-week high of $23.46 and 3.1% above its 52-week low of $22.21.
High expense ratio hinders performance. On total assets of $116.33 million, JMT maintains a high expense ratio compared to its General Mortgage peers of 2.73% to cover all operating costs. Brokerage costs for the fund to buy and sell shares are not included in the expense ratio. As JMT is a closed end fund, it has no front end or back end load.
Manager tenure and performance record are net positives. Substandard fund managers tend to be replaced, so a long tenure is usually a good sign that a fund is achieving its objectives. The Nuveen Mortgage Opportunity Term 2 has been managed by Michael F. Garrett for the last 8 years. Over that period, the manager was able to capture more actual gains in excess of the expected return than 95% of other fund managers.