Defined Asset Funds
Select Ten Portfolio
Sometimes, simple strategies can be the most effective ...
Like the strategy applied in our Select Ten Portfolio ...
Maybe you've heard of "The Dow Ten" or even "The Dogs of the Dow." However you
refer to it, this contrarian strategy of investing each year in the ten
highest dividend-yielding stocks of the Dow Jones Industrial Average(1) (DJIA)
looks for equity value by investing in established companies whose prices may
be depressed. After all, to a contrarian investor, bad news can be good news,
and unfavorable developments may create special opportunities.
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(1) 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 the prospectus relating to the Portfolio. "S&P
500" is a trademark of Standard & Poor's Corporation.
A time tested track record
We analyzed the Strategy of investing in the ten highest dividend-yielding
stocks over various periods to see how it compared to the DJIA and the S&P
500. The following charts illustrate past performance of the Strategy Stocks,
but not any Select Ten Portfolios. While there is no guarantee of future
results of any Portfolio, as you can see the results are compelling.
Time in the Market
Average Annual Total Return through 12/31/96/95; Strategy Stocks, DJIA and S&P
500 (dividends reinvested at year-end).
3year 5year 10year 15year 20year 25year
Strategy 21.63% 21.06% 18.21% 19.08% 17.72% 17.04%
Stocks
DJIA 18.69% 17.33% 16.34% 16.04% 14.00% 12.05%
S&P 500 15.16% 16.50% 14.79% 14.63% 14.37% 12.03%
[mountain graph entitled "Potential Growth of $10,000 invested in 1971 through
9/30/96" compares the cumulative annual performance from 1971 through 9/30/96
of the Strategy Stocks (blue), the DJIA (red) and the S&P 500 (green). A box
in the upper left quadrant indicated the components of the chart. The x axis
reflects dollar amounts and the y axis reflects years. The initial value of
each is $10,000; next to the right margin the ending values are stated as
follows: $596,047 for the Strategy Stocks; $200,916 for the DJIA; and $194,095
for the S&P 500.]
The charts above compare hypothetical performance of the Select Ten Strategy
Stocks with actual performance of the Dow Jones Industrial Average and the S&P
500 Composite Stock Price Index. The results shown assume that all dividends
during each year are reinvested at the end of that year, and do not reflect
sales charges, commissions, expenses or taxes. If Portfolio sales charges and
expenses were deducted, the Strategy Stocks would have outperformed the DJIA
and the S&P 500 in 14 of the last 5 years, and there can be no assurance that
any Portfolio will outperform the DJIA. Actual Portfolio performance will also
differ from Strategy Stocks because Portfolios are established and liquidated
at different times during the year, they normally purchase and sell stock at
prices different from the closing prices used in determining Portfolio unit
price, Portfolios are not fully invested at all times and stocks may not be
weighed equally. For more complete discussion of Strategy Stocks and Portfolio
performance, please speak to your financial professional.
The Select Ten Portfolio
The Select Ten Portfolio employs a simple strategy of investing in the ten
highest dividend-yielding stocks in the DJIA, and holding them for about one
year. After one year, you may choose to reinvest your proceeds into the next
Portfolio of the then-current Strategy Stocks, if available, or you can redeem
your investment. Although this is a one year investment, we recommend you stay
with the Strategy for a minimum of three- to five-years.
Defining Your Risks
Select Ten Portfolios are designed for investors able and willing to assume
the risks generally associated with equity investments, and may not be
appropriate for those seeking preservation of capital or high current income.
The value of the investment will fluctuate with the prices of the underlying
stocks. There can be no assurance that dividend rates will be maintained or
that the stock prices will not decrease.
Prior Select Ten Portfolio Performance
The chart below shows average annual total returns for each of the three
series, which assumes an annual "rollover" into the next Portfolio. We've also
included returns for the most recently completed Portfolio of each series:
Series from Inception through 9/30/96
Inception Return
A Series 1/3/92 14.30%
B Series 5/17/91 14.48%
C Series 9/1/92 16.90%
Most Recent Completed Portfolio
Period Return
1/9/95 - 2/23/96 34.72%
5/10/95 - 6/30/96 25.32%
9/7/94 - 9/30/95 22.41%
Past performance in no guarantee of future results. Average annual total
return represents price changes plus dividends reinvested at year-end, divided
by Initial Public Offering Price, and reflects maximum sales charges and
expenses.
Act Now
You can get started with Select Ten Strategy right now with as little as $250.
Simply return the attached coupon to receive a free copy of our brochure. Ask
your financial professional for a free prospectus containing more complete
information on the Select Ten Portfolio, including all charges and expenses.
Be sure to read it carefully before you invest.
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