Defined Asset Funds(SM)
Select Ten Portfolio
1996
[Graphic: 10 gold "coins" with
Series B [in circle] the following company names:
Philip Morris
Texaco
A Simple JP Morgan
Investment Exxon
Strategy For Chevron
Higher Total Minnesota Mining
Return Du Pont
International Paper
General Motors
General Electric
Each has the words
SELECT TEN arced at the top]
[logo] Merrill Lynch
[Column 1 - inside left page]
[Graphic: Thick dark blue line running the left-hand side of the column next
to text]
The Dow Jones Industrial Average
The Dow Jones Industrial Average (DJIA) consists of 30 common stocks chosen by
the editors of The Wall Street Journal as representative of the New York Stock
Exchange and of American industry. The companies are highly capitalized in
their industries and their stocks are widely held by individual and
institutional investors:
Allied Signal Procter & Gamble
J.P. Morgan American Express
3M International Paper
Du Pont Philip Morris
Eastman Kodak United Technologies
Goodyear Sears Roebuck
Bethlehem Steel Exxon
IBM Texaco
General Electric Coca-Cola
General Motors Union Carbide
McDonald's Walt Disney
Chevron AT&T
Caterpillar Westinghouse Electric
Boeing Woolworth
Merck Aluminum Co. of America
[Graphic: Gold "coin" with following text:
SELECT TEN (in an arc)
DJIA]
[Column 2 - inside left page]
With so many choices available, selecting investments for your portfolio can
be complicated. Sometimes, simple can be better.
The Select Ten Strategy
The Select Ten Portfolio seeks total return by holding the ten highest
dividend-yielding stocks of the Dow Jones Industrial Average* (the "Strategy
Stocks") for about one year. It's simple. It's convenient.
It's Simple
The Portfolio offers a simple way to seek potential values in the equity
market by investing in leading companies whose prices may be depressed.
The Portfolio consists of approximately equal values of the ten stocks in the
DJIA having the highest dividend yield at the time of the offering, and will
hold them for about one year. After one year, the Portfolio will liquidate.
You may choose to reinvest your proceeds into the next portfolio of the
then-current Strategy Stocks, if available, at a reduced sales charge, or you
can take the cash.
You can get started with the Select Ten Portfolio with as little as about $250.
It's Convenient
With the Select Ten Portfolio, you have a convenient way to invest in a fixed
portfolio of well known stocks with just one purchase. You'll also enjoy the
advantages of:
o Quarterly dividends. You will receive four consolidated checks per year,
not 40 for the 10 stocks.
o Reinvestment. You may choose to reinvest your dividends at a reduced sales
charge to compound your income.
o No sell decisions. You are buying and holding for about a year, a
portfolio of established companies with relatively high dividend yields.
o A deferred sales charge. You pay only part of your total sales charge when
you buy, since most will be collected on a deferred basis. This way, more of
your money is put to work immediately.
[Italic footnote at bottom of column 2]
*Dow Jones & Company, Inc., owner of the name "Dow Jones Industrial Average,"
is unaffiliated with, and did not participate in the creation of the Portfolio
or the selection of its stocks, and has neither reviewed nor approved any
information in this brochure or the prospectus relating to the Portfolio.
[Column 3 - inside left page]
Defining Your Risks
At Defined Asset Funds, our goal is to give investors the information they
need to make informed decisions. The following are important facts to keep in
mind when considering this investment for your portfolio. Please read them
carefully. Your financial professional will be happy to answer any questions
you may have.
o The Portfolio is designed for investors able and willing to assume the
risks generally associated with equity investments. It may not be appropriate
for investors seeking preservation of capital or high current income.
[Column 1 - inside right page]
o There can be no assurance that the Portfolio or Strategy will meet its
objective.
o The value of your investment will fluctuate with the prices of the
underlying stocks. There is no guarantee that dividend rates will be
maintained or that stock prices will not decrease.
o These stocks may have higher yields because they or their industries are
experiencing financial difficulties or are out of favor. There can be no
assurance the market factors that caused these relatively low prices and high
yields will change.
[Chart centered under column 3 on inside left page and column 1 on inside
right page]
Time-Tested Track Record [white letters/orange background]
We analyzed the Strategy of investing in the ten highest dividend-yielding
stocks in the DJIA, or "Strategy Stocks," over a 20-year period to see how it
had performed. The chart below illustrates past performance of the DJIA and
the Strategy Stocks. Although this is no guarantee of future results of any
Portfolio, as you can see the results are compelling. [text - black
letters/tan background]
Suppose you had invested $10,000 in the Strategy in 1976? [chart title
centered on light tan background]
X axis - range from $0 to $275,000 in $25,000 increments
Y axis - each year from 1976 through 1995
Key - orange refers to Strategy Stocks
blue refers to DJIA
Chart shows blue (DJIA) investment of $10,000 growing to $150,888 in
foreground [text - "$150,888 Ending 3/31/96" - white letters/blue background];
and orange (Strategy Stocks) investment of $10,000 growing to $276,983 in
background [text - "$276,983 Ending 3/31/96" - black letters/light tan
background].
[Text below chart as follows:]
The performance of the Strategy is a hypothetical example of how the Select
Ten Portfolio could have performed if its strategy had been employed since
1976. The chart assumes that all dividends during a year are reinvested at
the end of that year. It does not reflect sales charges, commissions,
expenses or taxes.
It is important to note that the actual performance of a Portfolio will differ
from that of the Strategy Stocks because the Portfolio has sales charges and
pays brokerage commissions and expenses. Strategy Stock figures are generally
annual figures based on the closing sale prices on December 31, while the
Portfolios are established and liquidated at different times during the year.
Also, performance varies because Portfolios normally purchase and sell stocks
at prices different from the closing price used in determining the Portfolio's
unit price, and the Portfolio is not fully invested at all times and not all
stocks may be weighted equally.
[Column 2 - inside right page]
[Graphic: wide orange line down right edge of page starting one inch from the
top]
[Chart]
Select Ten Portfolio 1996 Series B* [white letters/blue background]
Ticker Current
Name of Issuer Symbol Dividend Yield**
[text: black lettering on alternating yellow and grey background]
1. Philip Morris Companies, Inc. MO 4.19%
2. Texaco, Inc. TX 3.82%
3. Exxon Corporation XON 3.73%
4. J.P. Morgan & Company, Inc. JPM 3.70%
5. Chevron Corporation CHV 3.36%
6. General Motors Corporation GM 2.85%
7. Du Pont (E.I.) De Nemours & Company DD 2.80%
8. Minnesota Mining and Manufacturing Company MMM 2.74%
9. International Paper Company IP 2.35%
10.General Electric Company GE 2.26%
* Initial date of deposit - May 20, 1996
** Current Dividend Yield for each security was calculated by annualizing the
last quarterly or semi-annual ordinary dividend distributed on that security
and dividing the result by that security's market value as of the close of
trading on May 17, 1996. There can be no assurance that future dividends, if
any, will be maintained at the indicated rates.
The Strategy may not necessarily reflect the research opinions or any buy or
sell recommendation of any of the Sponsors.
[Chart - Title in white letters on blue background, text and statistics in
black letters on yellow background]
Prior Select Ten Portfolio Performance
This table shows total returns (price changes plus dividends reinvested,
divided by the maximum initial offering price) and reflects all sales charges
and expenses (but not taxes). These figures represent past performance, and
are no guarantee of future results.
Fund Term Total Return
Series B
1991 Spring 5/17/91-6/12/92 14.72%
1992 Spring 5/5/92-5/14/93 4.67%
1993 Spring 5/5/93-5/13/94 6.83%
1994 Spring 5/6/94-5/31/95 19.05%
Series C
1992 Autumn 9/1/92-9/14/93 17.01%
1993 Autumn 9/1/93-9/16/94 7.08%
1994 Autumn 9/7/94-9/29/95 23.90%
Series A
1992 Winter 1/3/92-1/8/93 0.07%
1993 Winter 1/4/93-1/14/94 23.93%
1994 Winter 1/5/94-1/27/95 -0.52%
1995 Winter 1/9/95-2/23/96 39.75%
The following shows the results that could have been obtained by investing in
the first series of each cycle on the initial offer date and rolling over each
year into successor series (including presently outstanding series).
Average
Cycle Term Total Return Annual Return
Spring 5/17/91-3/31/96 96.62% 14.89%
Autumn 9/1/92-3/31/96 84.71% 18.72%
Winter 1/3/92-3/31/96 73.88% 13.94%
[Column 1 on the last page]
Historical Performance of Strategy Stocks
If the Strategy had been followed for the last 20 years, investors generally
would have achieved a higher total return than if they had invested in the
entire DJIA.
Below is a hypothetical example of how the Strategy would have performed on a
theoretical basis from January 1, 1976 through March 31, 1996.* Past
performance shown is no guarantee of future results of any portfolio. The
figures do not reflect the Portfolio's sales charges, commissions, expenses,
or reinvestment of dividends.
[Chart: Title in white letters on blue background; statistical information in
black letters on yellow background and footnotes right below the chart]
Strategy Illustration
January 1, 1976 - March 31, 1996
DJIA Strategy Stocks
Year Total Return Total Return
1976 22.72% 34.81%
1977 -12.71% -0.83%
1978 2.69% 0.16%
1979 10.52% 12.35%
1980 21.41% 26.37%
1981 -3.40% 7.47%
1982 25.79% 25.46%
1983 25.68% 38.46%
1984 1.06% 7.34%
1985 32.78% 28.63%
1986 26.91% 34.57%
1987 6.02% 6.97%
1988 15.95% 21.50%
1989 31.71% 27.30%
1990 -0.57% -7.94%
1991 23.93% 33.37%
1992 7.34% 8.32%
1993 16.72% 26.92%
1994 4.95% 3.89%
1995 36.48% 36.48%
3/31/96 9.78% 6.07%
Average** 14.34% 17.82%
*As indicated, the Strategy Stocks underperformed the DJIA in 6 years, and
there can be no assurance that the Portfolio will outperform the DJIA. After
Portfolio sales charges and expenses, a Portfolio would have outperformed the
DJIA in 10 of the 20 years.
**Average annual total returns represent the annual rate of price
appreciation, plus dividends reinvested at the end of each year.
[Column 2 of the last page]
Defining Your Cost
Low Initial Sales Charge/
Reduced Charge for Rollovers
As illustrated in the chart below, first-time investors pay a 1% maximum sales
charge when they buy. In addition, a deferred sales charge of $1.75 per 1,000
units will be deducted from the Portfolio's net asset value each month over
the last ten months of the Portfolio's life ($17.50 total). This deferred
method of payment keeps more of your money invested over a longer period of
time.
[Chart]
As a % of
Amount per Public Offering
Amount Purchased 1,000 Units Price
Maximum Initial Sales Charge $10.00 1.00%
Deferred Sales Charges $17.50 1.75%
Your Sales Charge $27.50 2.75%
Should you reinvest the proceeds of your investment into a new portfolio, if
available, you will not be subject to the 1% initial charge, just the $17.50
deferred fee. If you sell your investment before maturity, the remaining
deferred sales charge and, in the secondary market, a charge to reflect
estimated costs of liquidating securities to meet cash redemptions, will be
deducted.
Volume Purchase Discounts
For larger purchases, the overall sales charges are reduced to put more of
your investment dollars to work for you.
[Chart]
Deferred Sales Total Sales Charge
Charge per as a % of the
Amount Purchased 1,000 units Public Offering Price
Less than $50,000 $17.50 2.75%
$50,000 to $99,999 $17.50 2.50%
$100,000 to $249,999 $17.50 2.00%
$250,000 or more $17.50 1.75%
Tax Reporting
The proceeds received when you sell this investment will reflect the
deduction of the deferred sales charge and the charge for organizational
expenses. In addition, the annual statement and the relevant tax reporting
forms you receive at year-end will reflect the actual amount paid to you
(net of the deferred sales charge and the charge for organizational
expenses). Accordingly, you should not increase your basis in your units
by the deferred sales charge and the charge for organizational expenses.
[Right below columns 1 and 2, it reads:]
Don't Delay
Call your financial professional for a free prospectus containing more
complete information, including all charges and expenses. Read it carefully
before you invest.
Units of the next Series are not yet available. Information herein is subject
to amendment. A registration statement relating to these securities has been
filed with the Securities and Exchange Commission. These securities may not
be sold nor may offers to buy be accepted prior to the time the registration
statement becomes effective. This document shall not constitute an offer to
buy nor shall there by any sale of these securities in any state in which such
an offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such state.
[Approximately 1/4 inch from bottom of page, on the left hand side sits the
recycling logo along with "Printed on Recycled Paper"]
[Column 3 of the last page, centered vertically, printed in white letters on
blue background heads-yellow on blue background]
Other Select Series
Hong Kong
(Hang Seng Index)
United Kingdom Portfolio
(Financial Times Index)
Japan Portfolio
(Nikkei Index)
Select Growth Portfolio
Equity Income Funds
Concept Series
Premier American Portfolio
Health Care Trust II
Natural Gas Trust 2
Real Estate Income Fund
TeleoGlobal Trust 2
Equity Income Funds
Utility Series
15th Utility Common Stock Series
Equity Income Funds
Index Series
S&P 500 Index Trust 2
S&P MidCap Index Trust
Other Defined Asset Funds
Bond Funds
Municipal Income Funds
Corporate Income Funds
Government Securities
Income Funds
International Bond Funds
[About 1/4 inch from bottom, it reads:]
14950-5/96
