DEFINED ASSET FUNDS[SM]
Select Ten Portfolio
International
1997
United
Kingdom
Portfolio
Series 1
Merrill Lynch
Financial Times Index
The Financial Times Industrial Ordinary Share Index (FT) Index consists of 30
common stocks chosen by the editors of The Financial Times (London) to be
representative of British industry and commerce. The companies are major
players in their industries and their stocks are widely held by individual and
institutional investors. The FT Index is an unweighted average of the share
prices of these companies:
Allied Domecq
ASDA Group
BOC Group
BTR
Blue Circle Industries
Boots Company
British Airways
British Petroleum Company
British Telecommunications
BG
Cadbury Schweppes
Courtaulds
General Electric Company
Glaxo Wellcome
Grand Metropolitan
GKN
Granada
Guinness
Imperial Chemical Industries
Lucas Industries
Lloyds TSB
Marks & Spencer
National Westminster Bank
Peninsular & Oriental Steam Navigation Company
Reuters Holdings
Royal & Sun Alliance Insurance
SmithKline Beecham
Tate & Lyle
Thorn EMI
Vadafone Group
SELECT TEN PORTFOLIO UNITED KINGDOM
INTERNATIONAL SERIES
Today's global marketplace offers many opportunities. Defined Asset Funds(SM)
Select Ten Portfolio--International Series uses a simple investment strategy to
help you take advantage of opportunities in selected countries.
Global Opportunities
Many International equity markets, such as the London Stock Exchange, offer
attractive growth potential, which can help investors diversify their
portfolios globally.
A Simple Strategy
This Portfolio seeks total return by investing in approximately equal values
of the ten stocks in the Financial Times Industrial Ordinary Shares (FT)
Index,(*) having the highest dividend yield shortly before the offering
(Strategy Stocks) and will hold them for about a year. These companies are
among the most highly capitalized in the United Kingdom.
*The publisher of the Financial Times Index has not participated in any way
in the creation of the Portfolio or in the selection of its stocks nor
approved any information included in this brochure.
After one year, the Portfolio will liquidate. You may choose to reinvest your
proceeds into the next Portfolio of the then-current Strategy Stock, if
available, at a reduced sales charge, or you can take the cash. Although each
Select Ten Portfolio is a one-year fund, we recommend you stay with the
Strategy for at least three to five years.
Offers U.S. Investors Some Big Advantages
o Semi-annual dividends. This means investors receive two consolidated checks
per year, not 20 for the 10 stocks, and payments are in U.S. dollars.
o Low cost. The minimum purchase is about $250.
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.
Defining Your Risks
As 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 should not be considered a complete investment program, and
may be considered speculative.
o The Portfolio may not be appropriate for investors seeking either
preservation of capital or high current income, nor would it be suitable for
investors unable or unwilling to assume the increased risks of higher price
volatility and currency fluctuations associated with investments in
international equities.
o There can be no assurance that the Portfolio or Strategy will meet its
objective.
o Total returns on United Kingdom stocks fluctuate widely, and the value of
your investment will change with the prices of the underlying stocks and
currency exchange rates. In addition, there is no guarantee that dividend
rates will be maintained or that stock prices or currency exchange rates will
not decline
o The stocks may have higher yields because they or their industries are
experiencing financial difficulty or are out of favor. There can be no
assurance the market factors that caused these relatively low prices and high
yields will change.
Select Ten Portfolio--International Series 1--1997 United Kingdom**
<TABLE>
<CAPTION>
Current
Name of Issuer Dividend Yield***
<S> <C>
1. BTR PLC 5.88%
2. Allied Domecq PLC 5.33
3. Peninsular & Oriental Steam Navigation Company 4.52
4. British Telecommunications PLC 4.41
5. Courtaulds PLC 4.32
6. BG PLC 4.20
7. Imperial Chemical Industries PLC 4.20
8. Tate & Lyle PLC 3.79
9. Royal & Sun Alliance Insurance Group PLC 3.66
10. Lucas Variety PLC 3.46
</TABLE>
**Initial date of deposit - February 24, 1997.
***Current dividend yield for each security was generally calculated by adding
the most recent interim and final dividends declared on the security and
dividing the result by its market value as of the close of trading on February
24, 1997. There can be no assurance that future dividends, if any, will be
maintained at the indicated rates.
The Strategy does not reflect the research opinions or any buy or sell
recommendation of any of the Sponsors.
Past Performance of Prior Select Ten Portfolios
The chart below shows average annual total returns for each of the three
established Series, which assume an annual "rollover" into the next Portfolio.
We've also included returns for the most recently completed Portfolio of each
Series:
<TABLE>
<CAPTION>
Series From Inception Most Recently
Through 12/31/96 Completed Portfolio
Inception Return Period Return
<S> <C> <C> <C> <C>
A Series 1/5/94 3.92% 1/6/95-2/23/96 5.57%
B Series 6/21/93 7.75% 5/10/95-6/28/96 -10.03%
C Series 9/28/93 5.68% 9/11/95-10/31/96 1.02%
</TABLE>
Past performance is no guarantee of future results. Average annual total
return represents price changes plus dividends, divided by the initial public
offering price, and reflects maximum sales charges and expenses. Returns for
Series Since Inception and Most Recently Completed Portfolio will differ
because Series Since Inception figures reflect a reduced sales charge for
consecutive rollovers. Also, the returns will differ because the performance
period of the Most Recently Completed Portfolio is different from that of the
Series Since Inception.
Time-Tested Track Record
Since stocks in the Portfolio were chosen solely by applying the Strategy, we
analyzed the Strategy to see how it had performed. The chart below
illustrates past performance of the FT Index and Strategy Stocks. Although
this is no guarantee of future results of any Portfolio, as you can see the
results are compelling.
[A mountain chart, captioned "Hypothetical growth of $10,000 invested in 1997
through 1996", compares the cumulative annual performance from 1977 through
12/31/96 of the Strategy Stocks (mustard) with the FT 30 Index (purple). A
box in the upper left quadrant indicates the components of the chart. The x
axis reflects dollar amount in $100,000 increments; the y axis reflects years.
The initial value is $100,000; next to the right left margin the ending values
are stated as follows: $748,813 Ending 12/31/96 (Strategy); $212,272 Ending
12/31/96 (Index).]
Annual Total Returns+
Periods ending December 31.
+After Portfolio sales charges and expenses, the Strategy Stocks would have
underperformed the Index in 7 of the 20 years and there can be no assurance
that any Portfolio will outperform the Index.
<TABLE>
<CAPTION>
Strategy FT Strategy FT
Year Stocks Index Year Stocks Index
<S> <C> <C> <C> <C> <C>
1977 87.27% 61.92% 1987 48.10 38.99
1978 17.73 9.92 1988 11.38 6.74
1979 4.76 3.59 1989 28.71 22.80
1980 30.15 31.77 1990 9.26 10.29
1981 -6.26 -5.30 1991 16.57 14.65
1982 44.03 0.42 1992 4.27 -2.33
1983 42.06 21.94 1993 37.69 18.40
1984 5.50 2.15 1994 5.46 1.89
1985 78.64 54.74 1995 10.83 17.63
1986 32.88 24.36 1996 14.29 20.05
Average++ 24.08% 16.51%
</TABLE>
++Average annual total returns represent the annual rate of price
appreciation, plus dividends reinvested at the end of each year.
The charts above compare hypothetical performance of the Select Ten Strategy
Stocks (not any actual Portfolio) with the actual performance of the Financial
Times Index. 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. Changes in the exchange rate of the pound
sterling relative to the U.S. dollar affected these figures significantly in
certain years. These changes ranged from -25% in 1981 and 1984 to +21% in
1987, and averaged -2.7% over the last 20 years.
It is important to note that actual performance of the Portfolio will differ
from the Strategy Stocks because the Portfolio has sales charges and pays
brokerage commissions and expenses. Strategy Stock figures are generally
annual figures based on December 31 sales prices, while the Portfolios are
established and liquidated at different times during the year. Portfolios
normally purchase and sell stocks at prices and currency exchange rates
different from the closing price and currency exchange rate used in
determining Portfolio unit price. In addition, Portfolios are not fully
invested at all times and not all stocks may not be weighted equally.
Defining Your Cost
Low Initial Sales Charge/
Reduced Charge for Rollovers
All investors pay a deferred sales charge of $1.75 per 1,000 units, deducted in
each of the last ten months of the Portfolio ($17.50 total). First-time
investors also pay an initial sales charge of approximately 1% when they buy.
<TABLE>
<CAPTION>
As a % of Public Amount per
Amount Purchased Offering Price 1,000 Units
<S> <C> <C>
- ------------------------------------------------------------------------------
Initial Sales Charge 1.00% $10.00
Deferred Sales Charge 1.75% $17.50
===== ======
Maximum Sales Charge 2.75% $27.50
- ------------------------------------------------------------------------------
</TABLE>
If you sell your units before termination, the remaining deferred sales
charges are deducted, along with the estimated costs of selling Portfolio
securities. If you roll over to a successor Portfolio, if available, the
initial charge is waived. You only pay the $17.50 deferred fee.
Volume Purchase Discounts
For larger purchases, the overall sales charges are reduced to put more of your
investment dollars to work for you.
<TABLE>
<CAPTION>
Total Sales Charge Deferred Sales
as a % of Charge Per
Amount Purchased Public Offering Price 1,000 Units
- -----------------------------------------------------------------------------
<S> <C> <C>
Less than $50,000 2.75% $17.50
$50,000 to $99,999 2.50% $17.50
$100,000 to $249,999 2.00% $17.50
$250,000 to $999,999 1.75% $17.50
$1,000,000 or more 1.00% $10.00
- -----------------------------------------------------------------------------
</TABLE>
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 tax basis in your units by the
deferred sales charge and the charge for organizational expenses. US
investors will include in income their share of dividends grossed up for
certain taxes paid by UK issuers; however, they may not be able to obtain
refunds for such taxes.
Don't Delay.
Call your financial professional for a free prospectus containing more complete
information, including all charges and expenses, and the special considerations
associated with the risks of international investing including currency risk.
Read the prospectus carefully before you invest.
Additional United Kingdom Portfolios containing the then-highest
dividend-yielding stocks may be created in the future. Information contained
herein is subject to completion or amendment. A registration statement
relating to the securities of the next Portfolio in this Select Ten
Portfolio--International Series has been filed with the Securities and
Exchange Commission. The securities of that Portfolio may not be sold nor may
offers to buy be accepted prior to the time that registration becomes
effective. This brochure shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these
securities in any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such state.
Other Select Series
Select Ten Portfolio (DJIA)
Hong Kong Portfolio (Hang Seng Index)
Japan Portfolio (Nikkei Index)
Select Growth Portfolio
Select S&P Intrinsic Value Portfolio
Select S&P Industrial Portfolio
Equity Income Funds Concept Series
Premier American Portfolio
Health Care Trust II
Natural Gas Trust 2
Real Estate Income Fund 2
Tele-Global 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
Municipal Investment Trusts
Corporate Income Funds
Government Securities Income Funds
International Bond Funds
14952BR-2/97
[Copyright] 1997Merrill Lynch, Pierce, Fenner & Smith Incorporated
Member SIPC
