IRA Ideal
Defined Asset Funds(sm)
Select Series
Defined Technology Portfolio(sm)
1999 Series 2
Merrill Lynch
100 Technology
Index
[Logo] Merrill Lynch
THE TECHNOLOGY SECTOR - IT HAS BEEN CONSIDERED AN
INVESTMENT FOR ONLY THOSE WITH THE MOST ROBUST OF
TEMPERAMENTS. THIS SECTOR HAS SHOWN WALL STREET LOFTY
HIGHS, AND HUMBLE LOWS. BUT WE BELIEVE THE TECHNOLOGY
SECTOR OFFERS GREAT POTENTIAL FOR THE FUTURE.
Defined Asset Funds(sm) gives you a convenient way to invest in the promise of
technology with the new Select Series Defined Technology Portfolio.(sm)
Merrilly Lynch
100 Technology
Index
The Merrill Lynch 100 Technology Index (ML 100 Index) is a benchmark for
technology stocks. It offers a cross-section of 100 highly-capitalized
technology stocks, covering important areas of this sector such as computer
software, semi-conductors, telecommunications equipment, electronic data
processing and the internet. The ML 100 Index also includes American Depositary
Receipts (ADRs) for international exposure. The ML 100 Index follows strict
quantitative rules to minimize subjectivity in stock selection, and only
includes stocks that have been tested for liquidity. You can follow the ML 100
Index on the American Stock Exchange using symbol MLO.
Technology: Rebalanced
The Defined Technology Portfolio offers you capital appreciation potential with
a diversified portfolio of technology stocks. By applying a Rebalancing Model
to the Merrill Lynch 100 Technology Index (ML 100 Index), this one-year
Portfolio seeks to outperform the index by reweighting each stock to increase
<PAGE>
potential return. Each year Defined Asset Funds intends to apply the
Rebalancing Model to the ML 100 Index, to create a new Portfolio.
The Enhanced Index Strategy
The Defined Technology Portfolio follows a disciplined "buy and hold" strategy
for index enhancement. It rebalances the index to pursue enhanced returns
without increasing risk. You can choose to roll your investment into a new
Defined Technology Portfolio, if available, or you can redeem your investment.
Although this is a one-year investment, we recommend you view your investment
in the Portfolio as a long-term strategy. For potentially more consistent
results, we suggest you continue with this Strategy for at least three to five
years.
If your view of this industry sector should change, Defined Asset Funds offers
you the flexibility to exchange your investment for another Select or Equity
Investor Series Portfolio at a reduced sales charge.
The Rebalancing Model
Bernard V. Tew, Ph.D., Chairman of Q.E.D. Investments designed his quantitative
model as a means for improving returns and controlling risks in speculative
equity sectors. Dr. Tew, as Portfolio Consultant for the Defined Technology
Portfolio, works together with Defined Asset Funds to apply the following stock
selection process:
Define the Universe
We begin by defining the universe of stocks. In this case, the ML 100 Index is
used for its diversification within the technology sector, as well as its more
highly capitalized stocks.
Reweight the Index
Stocks in the ML 100 Index are then analyzed by the Portfolio Consultant for
historical correlation relationships, to identify stocks whose prices and
returns move inversely to one another. These relationships create a portfolio
of stocks that complement each other and reduce volatility.
Construct an Enhanced Portfolio
The ML 100 Index is then balanced, stock by stock, from most attractive to
least attractive. Stocks that are considered most attractive, those with the
best
2
<PAGE>
prices relative to potential performance, are the most heavily weighted. Stocks
with less attractive prices relative to returns are underweighted. This
reweighting is designed to enhance potential return.
Rebalance the Portfolio
Because the Model works best over a one-year period, Defined Asset Funds and
the Portfolio Consultant plan to construct a new Portfolio each year. The Model
will be reapplied to the ML 100 Index to determine the weightings for a new
Defined Technology Portfolio.
Why Technology Now?
Imagine your world without cable TV, a cellular phone or a home computer. How
would your place of business operate without on-line services and networking
capabilities? While technology companies have seen ups and downs, it's an
industry that continues to redefine the way we live. Although, a number of
stocks represented in the Index have seen wide variations in performance over
the last several years and others are recent I.P.O.s, this sector continues to
have a long-term and growing impact on our future.
Defined Asset Funds - Time In The Market
We believe the disciplined strategy of buying and holding securities with long-
term view can help in meeting out investors' needs. For income, for growth or
for total return, time in the market can be an effective strategy for growing
your portfolio. This philosophy is the cornerstone of Defined Asset Funds.
3
<PAGE>
<TABLE>
The Merrill Lynch 100 Technology Index*
- ---------------------------------------------------------------------------------------------------------------------
Name of Issuer Ticker Symbol Name of Issuer Ticker Symbol
<S> <C> <C> <C>
1. 3Com Corporation COMS 51. Jabil Circuit, Inc. JBL
2. Adaptec, Inc. ADPT 52. Keane, Inc. KEA
3. ADC Telecommunications, Inc. ADCT 53. KLA-Tencor Corporation KLAC
4. Adobe Systems, Inc. ADBE 54. Lexmark International Group, Inc. LXK
(Class A)
5. Advanced Micro Devices, Inc. AMD 55. Linear Technology Corporation LLTC
6. Alcatel Alsthom** ALA 56. LSI Logic Corporation LSI
7. Altera Corporation ALTR 57. Lucent Technologies, Inc.*** LU
8. Amazon.com, Inc. AMZN 58. Maxim Integrated Products, Inc. MXIM
9. America Online, Inc.**** AOL 59. Micron Technology, Inc. MU
10. Americn Power Conversion Corporation APCC 60. Microsoft Corporation MSFT
11. AMP, Inc. AMP 61. Molex, Inc. MOLX
12. Analog Devices, Inc. ADI 62. Motorola, Inc. MOT
13. Apple Computer, Inc. AAPL 63. National Semiconductor Corportion NSM
14. Applied Materials, Inc. AMAT 64. Netscape Communications NSCP
Corporation
15. Ascend Communications, Inc. ASND 65. Network Appliance, Inc. NTAP
16. ASM Lithography Holding N.V. ASMLF 66. Network Associates, Inc. NETA
17. At Home Corporation (Series A) ATHM 67. Newbridge Networks Corporation NN
18. Autodesk, Inc. ADSK 68. Nokia Corporation NOKA
19. Automatic Data Processing, Inc. AUD 69. Northern Telecom Limited NT
20. Baan Company, N.V. BAANF 70. Novell, Inc. NOVL
</TABLE>
- --------
* Index as of 1/13/99
** The issuer is a foreign corporation; any dividends will be subject to
withholding taxes
*** It was announced on 1/13/99 that LU is expected to acquire ASND.
**** It was announced on 11/24/98 that AOL is expected to acquire NSCP.
4
<PAGE>
<TABLE>
- ---------------------------------------------------------------------------------------------------------------------
Name of Issuer Ticker Symbol Name of Issuer Ticker Symbol
<S> <C> <C> <C>
21. BMC Software, Inc. BMCS 71. Oracle Corporation ORCL
22. Broadcom Corporation (Class A) BRCM 72. Parametric Technology Corporation PMTC
23. Cadence Design Systems, Inc. CDN 73. Paychex, Inc. PAYX
24. Ceridian Corporation CEN 74. PeopleSoft, Inc. PSFT
25. Cisco Systems, Inc. CSCO 75. Platinum Technology, Inc. PLAT
26. Citrix Systems, Inc. CTXS 76. QUALCOMM, Inc. QCOM
27. Compaq Computer Corporation CPQ 77. Quantum Corporation QNTM
28. Computer Associates International, Inc. CA 78. Sanmina Corporation SANM
29. Computer Sciences Corporation CSC 79. SCI Systems, Inc. SCI
30. Compuware Corporation CPWR 80. Seagate Technology, Inc. SEG
31. Dell Computer Corporation DELL 81. Siebel Systems, Inc. SEBL
32. eBay, Inc. EBAY 82. Silicon Graphics, Inc. SGI
33. ECI Telecommunications Limited ECILF 83. Solectron Corporation SLR
34. Electronic Arts, Inc. ERTS 84. Sterling Commerce, Inc. SE
35. Electronic Data Systems Corporation EDS 85. Storage Technology Corporation STK
36. EMC Corporation EMC 86. Sun Microsystems, Inc. SUNW
37. Excite, Inc. XCIT 87. Synopsys, Inc. SNPS
38. First Data Corporation FDC 88. SAP AG SAP
39. Fiserv, Inc. FISV 89. Tech Data Corporation TECD
40. FORE Systems, Inc. FORE 90. Telefonaktiebolaget LM Ericsson ERICY
41. Gartner Group, Inc. (Class A) IT 91. Tellabs, Inc. TLAB
42. Gateway 2000, Inc. GTW 92. Teradyne, Inc. TER
43. General Instrument Corporation GIC 93. Texas Instruments, Inc. TXN
44. Hewlett-Packard Company HWP 94. Uniphase Corporation UNPH
45. Inktomi Corporation INKT 95. Unisys Corporation UIS
46. Intel Corporation INTC 96. VERITAS Software Corporation VRTS
47. International Business Machines Corporation IBM 97. Vitesse Semiconductor Corporation VTSS
48. Intuit, Inc. INTU 98. Xerox Corporation XRX
</TABLE>
5
<PAGE>
<TABLE>
- ---------------------------------------------------------------------------------------------------------------------
Name of Issuer Ticker Symbol Name of Issuer Ticker Symbol
<S> <C> <C> <C>
49. Iomega Corporation IOM 99. Xilinx, Inc. XLNX
50. J.D. Edwards & Company JDEC 100. Yahoo!, Inc. YHOO
</TABLE>
6
<PAGE>
Defining Your Risks
Please keep in mind the following factors when considering this investment.
Your financial professional will be happy to answer any questions you may have.
o There can be no assurance that the Portfolio will meet its objective.
o The Portfolio is designed for investors who can assume the risks
associated with equity investments, and may not be appropriate for
investors seeking capital preservation or high current income.
o The Portfolio is composed of aggressive growth stocks that are subject to
extreme price volatility, therefore, the Portfolio may be considered
speculative.
o The Portfolio consists exclusively of stocks from the technology sector
and should not be considered as a complete investment program.
o The Portfolio does not reflect any investment recommendations of the
Sponsor.
Tax Reporting
The proceeds received when you sell this investment will reflect the deduction
of the deferred sales charge and, after the initial offering period, the charge
for organization costs.
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 organization costs, after the initial
offering period. Accordingly, you should not increase the tax basis in your
units by these charges.
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 20% for individuals. However, on rollovers of future
Portfolios, if available, investors will defer recognition of gains and losses
on stocks that are transferred to the new Portfolio. Please consult your tax
advisor concerning state and local taxation.
Defining Your Costs
First-time investors pay an initial sales charge of about 1% when they buy. In
addition, 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
Initial Sales Charge 1.00% $10.00
Deferred Sales Charge 1.75% $17.50
Maximum Sales Charge 2.75% $27.50
7
<PAGE>
Estimated Annual Operating Expenses
(as a % of net assets) 0.18% $1.78
Estimated Organization Costs $2.82
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.
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
Less than $50,000 2.75%
$50,000 to $99,999 2.50%
$100,000 to $249,999 2.00%
$250,000 to $999,999 1.75%
$1,000,000 to $4,999,999 1.00%
$5,000,000 or more .60%
Invest in Technology Today!
You can start investing in technology with the Defined Technology Portfolio for
about $250. Call your financial professional for a free prospectus containing
more complete information, including all charges, expenses and risks. Please
read it carefully before you invest or send money.
The information in this brochure is not complete and may be changed. We may not
sell securities of the next Portfolio until the registration statement filed
with the Securities and Exchange Commission is effective. This brochure is not
an offer to sell these securities and is not soliciting an offer to buy these
securities in any state where their offer or sale is not permitted.
Defined Asset Funds
Select Series
Principled Values Portfolio
Select Ten Portfolio (DJIA)
United Kingdom Portfolio (Financial Times Index)
8
<PAGE>
Select Growth Portfolio
Select S&P Industrial Portfolio
Select S&P Industry Turnaround Portfolio
Select S&P Intrinsic Value Portfolio
Concept Series
Premier American Portfolio
Premier World Portfolio
Real Estate Income Fund
Tele-Global Trust
Utility Portfolio
Western Premier Portfolio
Focus Series
European Monetary Union Portfolio
Financial Portfolio
Health Care Portfolio
Year-Ahead Domestic Portfolio
Year-Ahead International Portfolio
Index Series
S&P 500 Index Trust 2
S&P MidCap Index Trust
Fixed-Income Funds
Corporate Funds
Government Funds
Municipal Funds
9
