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IRA Ideal!
Defined Asset Funds[SM]
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Select Ten Portfolio
I N T E R N A T I O N A L
1998
Japan
Portfolio
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Series B
Merrill Lynch
SELECTING INVESTMENTS FOR YOUR PORTFOLIO CAN BE COMPLICATED--UNLESS YOU HAVE A
STRATEGY.
Defined Asset Funds[SM] Select Ten Portfolio--International Series uses an
investment strategy to help you take advantage of opportunities in selected
countries. International equity markets, such as the Tokyo Stock Exchange,
can offer attractive growth potential and help investors diversify their
portfolios. Japan's economic growth is reflected in the performance of its
leading stock market indicator, the Nikkei 225 Index.*
The Select Ten Strategy
The Portfolio seeks total return by holding the ten highest dividend-yielding
stocks of the Nikkei 225 Index for about one year (the "Strategy").
The Portfolio looks for potential values in the equity market by investing in
established companies whose prices may be depressed. It consists of
approximately equal values of the ten stocks in the Nikkei 225 Index with the
highest dividend yields at the time of the offering.
Each year, we intend to reapply the screening process to select a new Portfolio.
You can reinvest in the next Portfolio, if available, at a reduced sales charge,
or you can redeem your investment. Although each Portfolio is a one-year
investment, we recommend you stay with the Strategy for at least three to five
years for more consistent results.
Select Ten International Japan Portfolio--1998 Series B+
Name of Issuer Current Dividend Yield++
1. Nippon Shinpan Co., Ltd. 3.42%
2. Tonen Corporation 3.35
3. Japan Energy Corporation 2.84
4. Furukawa Co., Ltd. 2.42
5. Sankyu Inc. 2.40
6. UBE Industries, Ltd. 2.27
7. Nippon Piston Ring Company, Limited 2.20
8. Tokyo Rope MFG 2.19
9. Toyobo, Ltd. 2.13
10. Nippon Synthetic Chemical Industry Co., Ltd. 1.95
The Portfolio does not reflect the research opinions or any buy or sell
recommendations of any of the Sponsors.
+ Initial date of deposit -- May 29, 1998.
++ Current dividend yield for each security was calculated by adding the
most recent interim and final dividends declared on that security and
dividing the result by its market value as of the close of trading on
May 29, 1998. There can be no assurance that future dividends, if any,
will be maintained at the indicated rates.
Past Performance of Prior Select Ten International Japan Portfolios
The chart below shows average annual total returns for the following Series,
which assume annual "rollovers" into the next Portfolio. We've also included
returns for the most recently completed Portfolio of each Series.
<TABLE>
<CAPTION>
Series From Inception Through 3/31/98 Most Recently Completed Portfolios
......................................... ...............................................
<C> <C> <C> <C> <C> <C>
Inception Return Period Return
1/22/96 Series A -33.90% 1/27/97-2/27/98 Series A -27.67%
5/20/96 Series B -34.33% 5/20/96-6/27/97 Series B -21.46%
7/22/96 Series 3 -34.32% 7/22/96-8/29/97 Series 3 -28.83%
9/17/96 Series C -35.35% 9/17/96-10/24/97 Series C -39.15%
11/1/96 Series 5 -33.64% 11/1/96-12/12/97 Series 5 -40.98%
2/25/97 Series 1 -39.69% 2/25/97-3/27/98 Series 1 -33.24%
</TABLE>
Past performance is no guarantee of future results. Average annual total
returns represent price changes plus dividends reinvested, divided by the
initial public offering price, and reflect maximum sales charges and
expenses. Returns for Series From Inception differ from Most Recently
Completed Portfolio because they reflect a reduced sales charge on
rollovers and different performance periods, and Portfolios may not be
fully invested at all times.
* The publisher of the Nikkei 225 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.
[INSERT GRAPHIC -- SELECT TEN
PORTFOLIO: JAPAN:
INTERNATIONAL SERIES]
The Nikkei 225 Index
The Nikkei 225 Index consists of 225 Japanese companies listed in the first
section of the Tokyo Stock Exchange. First published in 1950, the Nikkei
is well known both in Japan and worldwide.
The Nikkei 225 Index is published by the Nihon Keizai Shimbun (Japan
Economic Journal).
The Nikkei 225 Index is a price-weighted index. This means that the
movement of each stock, in yen or dollars, is equally weighted regardless
of its market capitalization.
Advantages for U.S. Investors
o Low cost. The minimum investment is $250.
o Semi-annual dividends. Investors receive two consolidated checks per
year, not 20 for the 10 stocks, and payments are in U.S. dollars.
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.
Hypothetical Growth of $10,000 invested 1/1/78 Through 3/31/98
[A mountain chart compares the hypothetical growth of $10,000 invested
from 1/1/78 through 3/31/98 in the Nikkei 225 Index (orange) and the
Strategy (sienna). A sienna box in the upper left quadrant indicates the
components of the Strategy (net of sales charges and expenses). At the end
of this period the mountain chart reflects the ending value of the
Strategy ($143,144) and the ending value of the Nikkei 225 Index
($75,853).]
Since stocks in the Portfolio were chosen solely by applying the Strategy, we
analyzed the Strategy to see how it could have performed. Past performance of
the Strategy is no guarantee of future results of any Portfolio. The Strategy
would have underperformed the Nikkei 225 Index in 9 of the last 20 years.
There can be no assurance that any Portfolio will outperform the Index.
Annual Total Returns
Strategy returns are net of sales charges and expenses.Section
Nikkei 225 Nikkei 225
Year Strategy Index Year Strategy Index
1978 69.50% 55.32% 1989 20.96 12.80
1979 -3.26 -10.00 1990 -44.56 -34.79
1980 37.07 29.47 1991 4.68 5.56
1981 16.35 2.20 1992 -18.86 -25.76
1982 -4.96 -0.77 1993 19.49 15.94
1983 29.10 27.08 1994 26.04 28.30
1984 0.80 8.92 1995 -7.41 -2.30
1985 51.28 44.19 1996 -19.48 12.43
1986 76.27 83.78 1997 -42.70 -29.71
1987 92.19 50.71 3/31/98 46.04 6.16
1988 61.39 36.57 Average -14.04% 10.52%
The results shown are hypothetical past performance of the Strategy (not
any Portfolio) and are no guarantee of future results. Returns represent
price changes plus dividends reinvested at each year end, divided by the
initial public offering price, and do not reflect the deductions of any
commissions or taxes. Changes in the exchange rates of the Japanese yen
relative to the U.S. dollar affected these figures significantly. These
changes ranged from -23% in 1979 to +23% in 1987 and averaged +2.09%
annually over the last 20 years. There can be no assurance that such
appreciation will continue during the life of the Portfolio or successive
rollover Series.
Portfolio performance will differ from the Strategy because of commissions,
Portfolios are established and liquidated at different times during the year,
they normally purchase and sell stocks at prices and currency exchange rates
different from those used in determining Portfolio unit price, they are not
fully invested at all times and stocks may not be weighted equally.
Section Net of Portfolio sales charges (2.75% for the first year, 1.75% for
each subsequent year) and estimated expenses.
Defining Your Risks
The following are important facts to keep in mind when considering this
investment. 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 will meet its objective.
o Total returns on Japanese 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 can be no assurance that
dividend rates will be maintained or that stock prices or currency
exchange rates will not decline.
o The Portfolio's exposure to the Japanese yen is not hedged.
o These stocks may have higher yields because they or their industries are
experiencing financial difficulty or are out of favor. There can be no
assurance that the market factors that caused these relatively low prices
and high yields will change.
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 be based on the amount paid to you, net
of the deferred sales charge and the charge for organizational expenses.
Accordingly, you should not increase the tax basis in your units by these
sales charges and expenses.
Generally, dividends and any gains will be subject to tax each year.
Capital gains, if any, on assets held over a year will be taxed up to the
maximum federal tax rate of 28%. However, on rollovers of future
Portfolios, if available, investors will defer recognition of gains and
losses on stocks that are contributed in kind to the new Portfolio.
Investors may also be eligible for a 20% maximum federal tax rate on gains
from those stocks when they are sold.
Defining Your Costs
First-time investors pay an initial sales charge of about 1% when they buy.
All investors pay a deferred sales charge of $17.50 per 1,000 units, about
1.75%, deducted over the last ten months of the Portfolio.
As a % of Public Amount Per
Offering Price 1,000 Units
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Initial Sales Charge 1.00% $10.00
Deferred Sales Charge 1.75% $17.50
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Maximum Sales Charge 2.75% $27.50
Estimated Annual Operating Expenses
(as a % of net assets) .505% $5.00
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If you sell your units before termination, the remaining balance of your
deferred sales charge will be deducted, along with the estimated costs of
selling Portfolio securities from the proceeds you receive. If you roll
over to a successor Portfolio, if available, the initial charge will be
waived. You will only pay the deferred sales charge and operating
expenses.
Volume Purchase Discounts
For larger purchases, the overall sales charges are reduced to put more of
your investment dollars to work for you.
Amount Total Sales Charge as a % of
Purchased Public Offering Price
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Less than $50,000 2.75%
$50,000 to $99,000 2.50%
$100,000 to $249,999 2.00%
$250,000 to $999,999 1.75%
$1,000,000 or more 1.00%
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Defined Asset Funds
Buy With Knowledge
o Hold With Confidence
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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 Japan 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 the Portfolio may not be sold nor may offers
to buy be accepted prior to the time that registration becomes effective.
This brochure may 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 an offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such state.
(recycled) Printed on Recycled Paper 11389BR-5/98
[Copyright] 1998 Merrill Lynch, Pierce, Fenner & Smith Incorporated.
Member SIPC.
