EQUITY INVESTOR FD SEL SER 1998 YR AHEAD PORT DEF ASSET FUND, 497, 1997-12-11

EQUITY INVESTOR FD SEL SER 1998 YR AHEAD PORT DEF ASSET FUND
497, 1997-12-11

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DEFINED ASSET FUNDSSM
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EQUITY INVESTOR FUND The objective of this Defined Fund is capital
SELECT SERIES appreciation by investing for a period of about
1998 YEAR AHEAD one year in a portfolio consisting primarily of
PORTFOLIO liquid, domestic common stocks. These stocks were
(A UNIT INVESTMENT selected for potential growth in 1998 by the
TRUST) Merrill Lynch Global Research and Economics group.
- ------------------------------Current dividend income is not an objective of the
Fund.
The Fund is not an appropriate investment for
investors seeking preservation of capital.
The value of units will fluctuate with the value
of the common stocks in the Portfolio and there
can be no assurance that the Fund will achieve its
objective.
Minimum purchase: $250.

-------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS DOCUMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
Inquiries should be directed to the Trustee at
SPONSOR: 1-800-323-1508.
Merrill Lynch, Prospectus dated December 9, 1997.
Pierce, Fenner & Smith INVESTORS SHOULD READ THIS PROSPECTUS CAREFULLY
Incorporated AND RETAIN IT FOR FUTURE REFERENCE.

<PAGE>
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Def ined Asset FundsSM
Defined Asset Funds is America's oldest and largest family of unit investment
trusts, with over $115 billion sponsored in the last 25 years. Each Defined
Asset Fund is a portfolio of preselected securities. The portfolio is divided
into 'units' representing equal shares of the underlying assets. Each unit
receives an equal share of income and principal distributions.
Defined Asset Funds offer several defined 'distinctives'. You know in advance
what you are investing in and that changes in the portfolio are limited - a
defined portfolio. Most defined bond funds pay interest monthly - defined
income. The portfolio offers a convenient and simple way to invest - simplicity
defined.
Your financial professional can help you select a Defined Asset Fund to meet
your personal investment objectives. Our size and market presence enable us to
offer a wide variety of investments. The Defined Asset Funds family offers:
o Municipal bond portfolios
o Corporate bond portfolios
o Government bond portfolios
o Equity portfolios
o International bond and equity portfolios
The terms of Defined Funds are as short as one year or as long as 30 years.
Special defined bond funds are available including: insured funds, double and
triple tax-free funds and funds with 'laddered maturities' to help protect
against changing interest rates. Defined Asset Funds are offered by prospectus
only.
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Defined Select Year Ahead Portfolio
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The Portfolio contains 14 common stocks selected for capital appreciation. This
Select Series permits investors to buy and hold the Portfolio for approximately
one year. At the end of the year, the Portfolio will be liquidated and a similar
selection process applied to select a new Portfolio. Each Select Portfolio is
designed to be part of a longer term strategy and the Sponsor believes that more
consistent results are likely if the strategy is followed for at least three to
five years.
So long as the Sponsor continues to offer new portfolios, investors will have
the option to reinvest into a new portfolio each year at a reduced sales charge.
The Sponsor reserves the right, however, not to offer a new portfolio.
The Securities were selected by the Merrill Lynch Global Research and Economics
group for their potential growth over the coming year.
- ----------------------------------------------------------------
Defining Your Portfolio
- ----------------------------------------------------------------
The Portflio is diversified among a wide variety of industries and is not
considered to be concentrated in any single industry.
Based upon the principal business of each issuer and current market values, the
following industry sectors are represented in the Portfolio:
APPROXIMATE
PORTFOLIO PERCENTAGE
/ / Insurance 15%
/ / Computer Services 8
/ / Airlines 7
/ / Building & Construction 7
/ / Cable/Telecommunications 7
/ / Gas Distribution 7
/ / Hospitals/Healthcare 7
/ / Medical/Drugs 7
/ / Medical Instruments 7
/ / Money Center Banks 7
/ / Mortgage Loan/Banker 7
/ / Retail/Office Supplies 7
/ / Retail/Restaurants 7
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Defining Your Risks
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There can be no assurance that the Portfolio will meet its objective over its
one-year life or that portfolios selected through this process during
consecutive one-year periods will meet their objectives. In addition, the
opinions of Merrill Lynch research analysts may change during the year. The
Portfolio is not appropriate for investors who are unable or unwilling to assume
the risk involved generally with an equity investment and who are seeking
preservation of capital or high current income. The Portfolio is not designed to
be a complete investment program.
Unit price fluctuates with the value of the Portfolio, which could be affected
by changes in the financial condition of the issuers, changes in the various
industries represented in the Portfolio, the impact of the Sponsor's purchase
and sale of securities for the Portfolio, movements in stock prices generally
and other factors. Additionally, equity markets have been at historically high
levels and no assurance can be given that these levels will continue. (See Risk
Factors in Part B.)
Unlike a mutual fund, the Portfolio is not actively managed and the Sponsor
receives no management fee. Therefore, the adverse financial condition of an
issuer, changes in research analysts' opinions or any market movement in the
price of a security will not require the sale of securities from the Portfolio
or mean that the Sponsor will not continue to purchase the security in order to
create additional Units; however, the Sponsor may instruct the Trustee to sell
securities under certain limited circumstances. (See Portfolio Supervision in
Part B.)
A-2
<PAGE>
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Defining Your Investment
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PUBLIC OFFERING PRICE PER 1,000 UNITS $1,000.00
The Public Offering Price as of December 8, 1997, the business day prior to the
initial date of deposit, is based on the aggregate value of the underlying
securities ($404,728.14) and any cash held to purchase securities, divided by
the number of units outstanding (408,816) times 1,000, plus the initial sales
charge. Units offered on the Initial Date of Deposit will also be priced at
$1,000 per 1,000 Units although the aggregate value of the underlying
securities, cash amount and number of Units may vary. The Public Offering Price
on any subsequent date will vary. The underlying securities are valued by the
Trustee on the basis of their closing sale prices at 4:00 p.m. Eastern time on
every business day.
SALES CHARGES
The total sales charge for this investment combines an initial up-front sales
charge and a deferred sales charge that will be deducted from the net asset
value of the Portfolio on March 1 and 15, 1998 and thereafter on the 1st of each
month through November 1, 1998.
ROLLOVER OPTION
When this Select Year Ahead Portfolio is about to be liquidated, you may have
the option to roll your proceeds into the next Select Year Ahead Portfolio. If
you notify your financial professional by December 16, 1998, your units will be
redeemed and your proceeds will be reinvested in units of the next Portfolio, if
available. If you decide not to roll over your proceeds, you will receive a cash
distribution after the Fund terminates. Of course you can sell or redeem your
Units at any time prior to termination.
DISTRIBUTIONS
You will receive distributions of any dividend income, net of expenses, on the
25th day of March, May, August and October 1998, if you own Units on the 10th of
those months.
REINVESTMENT OPTION
You can elect to automatically reinvest your distributions into additional units
of the Portfolio subject only to the deferred sales charge remaining at the time
of reinvestment. Reinvesting helps to compound your income for a greater total
return.
TAXES
In the opinion of counsel, you will be considered to have received all the
dividends paid on your pro rata portion of each security in the Portfolio when
those dividends are received by the Portfolio, even though a portion of the
dividend payments may be used to pay expenses of the Portfolio and regardless of
whether you reinvest your dividends in the Portfolio. You will not be entitled
under the Taxpayer Relief Act of 1997 to the new 20% maximum federal tax rate
for capital gains derived from the Portfolio. (See Taxes in Part B.)
TAX BASIS 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 upon the 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.
MANDATORY TERMINATION DATE
The Portfolio will terminate by January 8, 1999. The final distribution will be
made within a reasonable time afterward. The Portfolio may be terminated earlier
if its value is less than 40% of the value of the securities when deposited.
SPONSOR'S PROFIT OR LOSS
The Sponsor's profit or loss from the Portfolio will include the receipt of
applicable sales charges, fluctuations in the Public Offering Price or secondary
market price of units, a loss of $357.50 on the initial deposit of the
securities and a gain or loss on subsequent deposits of securities (see
Sponsor's and Underwriters' Profits in Part B).
A-3
<PAGE>
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Defining Your Costs
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SALES CHARGE
First-time investors pay a 1% sales charge when they buy. For example, on a
$1,000 investment, $990 is invested in the Portfolio. 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 life of the Portfolio ($17.50 total). This
deferred method of payment keeps more of your money invested over a longer
period of time. If you roll the proceeds of your investment into a new
portfolio, you will not be subject to the 1% initial charge, just the $17.50
deferred fee. Although this is a unit investment trust rather than a mutual
fund, the following information is presented to permit a comparison of fees and
an understanding of the direct or indirect costs and expenses that you pay.

As a %
of Initial Public Amount per
Offering Price 1,000 Units
----------------- --------------
Maximum Initial Sales Charge 1.00% $ 10.00
Deferred Sales Charge per Year 1.75% 17.50
----------------- --------------
2.75% $ 27.50
----------------- --------------
----------------- --------------
Maximum Sales Charge Imposed per
Year on Reinvested Dividends 1.40% $ 14.00

ESTIMATED ANNUAL FUND OPERATING EXPENSES

As a % Amount per
of Net Assets 1,000 Units
----------------- --------------
Trustee's Fee .083% $ 0.82
Portfolio Supervision,
Bookkeeping and Administrative
Fees .046% $ 0.45
Organizational Expenses .113% $ 1.12
Other Operating Expenses .017% $ 0.17
----------------- --------------
TOTAL .259% $ 2.56

This Portfolio (and therefore the investors) will bear all or a portion of its
organizational costs--including costs of preparing the registration statement,
the trust indenture and other closing documents, registering units with the SEC
and the states, and the initial audit of the Portfolio--as is common for mutual
funds.
COSTS OVER TIME
You would pay the following cumulative expenses on a $1,000 investment, assuming
5% annual return on the investment throughout the indicated periods and
redemption at the end of the period:

1 Year 3 Years 5 Years 10 Years
$30 $73 $118 $243

Although the Portfolio has a term of only one year and is a unit investment
trust rather than a mutual fund, this information is presented to permit a
comparison of fees, assuming the investment is rolled over each year into a new
portfolio subject only to the deferred sales charge and fund expenses.
The example assumes reinvestment of any dividends and distributions and uses a
5% annual rate of return as mandated by SEC regulations applicable to mutual
funds. For purposes of the example, the deferred sales charge imposed on
reinvestment of dividends is not reflected until the year following payment of
the dividend; the cumulative expenses would be higher if sales charges on
reinvested dividends were reflected in the year of reinvestment.
Reductions to the repurchase and cash redemption prices in the secondary market
to recoup the costs of liquidating securities to meet redemption (described
below) have not been reflected. The example should not be considered a
representation of past or future expenses or annual rates of return; the actual
expenses and annual rates of return may be more or less than the example.
REDEEMING OR SELLING YOUR INVESTMENT
You may redeem or sell your units at any time prior to the termination of the
Portfolio. Your price will be based on the then current net asset value. The
redemption and secondary market repurchase price as of December 8, 1997 was
$972.50 per 1,000 units ($27.50 per 1,000 units less than the Public Offering
Price). This price reflects deductions of the deferred sales charge which
declines over the life of the Portfolio ($17.50 initially). If you redeem or
sell your units before the termination of the Portfolio, you will pay the
remaining balance of the deferred sales charge. After the initial offering
period, the repurchase and cash redemption prices for units will be reduced to
reflect the estimated costs of liquidating securities to meet the redemption,
currently estimated at $0.91 per 1,000 units. If you reinvest in the new
portfolio, you will pay your share of any brokerage commissions on the sale of
underlying securities when your units are liquidated during the rollover.
A-4
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
The Sponsor, Trustee and Holders of Equity Investor Fund Select Series, 1998
Year Ahead Portfolio, Defined Asset Funds (the 'Fund'):
We have audited the accompanying statement of condition and the defined
portfolio included in the prospectus of the Fund as of December 9, 1997. This
financial statement is the responsibility of the Trustee. Our responsibility is
to express an opinion on this financial statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. Our procedures included
confirmation of an irrevocable letter of credit deposited for the purchase of
securities, as described in the statement of condition, with the Trustee. An
audit also includes assessing the accounting principles used and significant
estimates made by the Trustee, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the financial position of the Fund as of December 9, 1997
in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, N.Y.
December 9, 1997
STATEMENT OF CONDITION AS OF DECEMBER 9, 1997
TRUST PROPERTY

Investments--Contracts to purchase Securities(1).........$ 404,728.14
Organizational Costs(2).................................. 224,000.00
--------------------
Total.........................................$ 628,728.14
--------------------
--------------------
LIABILITY AND INTEREST OF HOLDERS
Accrued Liability(2)...................................$ 224,000.00
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Subtotal...............................................$ 224,000.00
--------------------
Interest of Holders of 408,816 Units of fractional
undivided interest outstanding(3):
Cost to investors(4)...................................$ 408,816.00
Gross underwriting commissions(5)...................... (4,087.86)
--------------------
Subtotal...............................................$ 404,728.14
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Total.........................................$ 628,728.14
--------------------
--------------------

- ---------------
(1) Aggregate cost to the Fund of the securities listed under Defined
Portfolio determined by the Trustee at 4:00 p.m., Eastern time on December 8,
1997. The contracts to purchase securities are collateralized by an irrevocable
letter of credit which has been issued by DBS Bank, New York Branch, in the
amount of $405,085.64 and deposited with the Trustee. The amount of the letter
of credit includes $404,728.14 for the purchase of securities.
(2) This represents a portion of the Fund's organizational costs,
which will be deferred and amortized over the life of the Fund. Organizational
costs have been estimated based on projected total assets of $200 million. To
the extent the Fund is larger or smaller, the amount may vary.
(3) Because the value of securities at the evaluation time on the
Initial Date of Deposit may differ from the amounts shown in this statement of
condition, the number of Units offered on the Initial Date of Deposit will be
adjusted from the initial number of Units to maintain the $1,000 per 1,000 Units
offering price.
(4) Aggregate public offering price computed on the basis of the
value of the underlying securities at 4:00 p.m., Eastern time on December 8,
1997.
(5) Assumes the maximum initial sales charge per 1,000 units of 1.00%
of the Public Offering Price. A deferred sales charge of $1.75 per 1,000 Units
is payable on March 1 and 15, 1998 and thereafter on the 1st day of each month
through November 1, 1998. Distributions will be made on behalf of investors to
an account maintained by the Trustee from which the deferred sales charge
obligation of the investors to the Sponsors will be satisfied. If units are
redeemed prior to November 1, 1998, the remaining portion of the distribution
applicable to such units will be transferred to such account on the redemption
date.
A-5
<PAGE>
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Defined Portfolio
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Equity Investor Fund Select Series
1998 Year Ahead Portfolio December 9, 1997
Defined Asset Funds

NUMBER OF
SHARES OF PRICE
TICKER COMMON PERCENTAGE PER SHARE COST
NAME OF ISSUER SYMBOL STOCK OF FUND (1) TO FUND TO FUND (2)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>

1. Bank of New York
Company, Inc. BK 500 7.03% $ 56.9375 $ 28,468.75
2. Chubb Corporation CB 400 7.47 75.6250 30,250.00
3. Comcast Corporation CMCSK 1,000 6.87 27.8125 27,812.50
4. Cracker Barrel Old Country
Store, Inc. CBRL 900 7.20 32.3750 29,137.50
5. Delta Air Lines, Inc. DAL 250 7.36 119.1875 29,796.88
6. DST Systems, Inc. DST 750 7.45 40.1875 30,140.63
7. Fannie Mae FNM 500 6.76 54.6875 27,343.75
8. Guidant Corporation GDT 450 6.83 61.4375 27,646.88
9. Masco Corporation MAS 600 7.36 49.6250 29,775.00
10. Office Depot, Inc. ODP 1,250 6.99 22.6250 28,281.25
11. Pfizer, Inc. PFE 400 7.39 74.7500 29,900.00
12. Protective Life Corporation PL 500 7.28 58.9375 29,468.75
13. Questar Corporation STR 700 6.90 39.8750 27,912.50
14. Tenet Healthcare Corporation THC 850 7.11 33.8750 28,793.75
--------------- -----------------
100.00% $ 404,728.14
--------------- -----------------
--------------- -----------------
</TABLE>

- ------------------------------------
(1) Based on Cost to Fund.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on December 8, 1997, the initial date of deposit. The value
of the securities on any subsequent date will vary.
------------------------------------
The securities were acquired on December 8, 1997 and are represented entirely by
contracts to purchase the securities. The Sponsor may have acted as underwriter,
manager or comanager of a public offering of the securities in this Fund during
the last three years. Affiliates of the Sponsor may serve as specialists during
the last three years. Affiliates of the Sponsor may serve as specialists in the
securities in this Fund on one or more stock exchanges and may have a long or
short position in any of these securities or in options on any of them, and may
be on the opposite side of public orders executed on the floor of an exchange
where the securities are listed. An officer, director or employee of the Sponsor
may be an officer or director of one or more of the issuers of the securities in
the Fund. The Sponsor may trade for its own account as an odd-lot dealer, market
maker, block positioner and/or arbitrageur in any of the securities or in
options on them. The Sponsor, its affiliates, directors, elected officers and
employee benefits programs may have either a long or short position in any
securities or in options on them.
A-6
<PAGE>
DEFINED ASSET FUNDSSM
PROSPECTUS--PART B
EQUITY INVESTOR FUND SELECT SERIES 1998 YEAR AHEAD PORTFOLIO
FURTHER INFORMATION REGARDING THE FUND MAY BE OBTAINED
WITHIN FIVE DAYS BY WRITING OR CALLING THE TRUSTEE AT THE ADDRESS AND
TELEPHONE NUMBER SET FORTH ON THE BACK COVER OF THIS PROSPECTUS.
INDEX

PAGE
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FUND DESCRIPTION................................ 1
RISK FACTORS.................................... 2
HOW TO BUY UNITS................................ 3
HOW TO REDEEM OR SELL UNITS..................... 4
INCOME, DISTRIBUTIONS AND REINVESTMENT.......... 6
FUND EXPENSES................................... 6
TAXES........................................... 7
RECORDS AND REPORTS............................. 9
TRUST INDENTURE................................. 9
MISCELLANEOUS................................... 10
EXCHANGE OPTION................................. 12
SUPPLEMENTAL INFORMATION........................ 12

FUND DESCRIPTION
THE SELECT YEAR AHEAD PORTFOLIO
This Select Series seeks capital appreciation and is designed to permit an
investor to buy and hold a portfolio consisting primarily of domestic equity
securities for a period of approximately one year. At the end of the year a
similar selection process is applied and the investor may reinvest in a new
portfolio, if available.
Investors should be aware that the Fund may not be able to buy each
Security at the same time because of availability of the Security, any
restrictions applicable to the Fund relating to the purchase of the Security by
reason of the federal securities laws or otherwise. Any monies allocated to the
purchase of a Security will generally be held for the purchase of the Security.
The deposit of the Securities in the Portfolio on the initial date of
deposit established a proportionate relationship among the number of shares of
each Security. During the 90-day period following the initial date of deposit
the Sponsor may deposit additional Securities in order to create new Units,
maintaining to the extent practicable that original proportionate relationship.
Deposits of additional Securities subsequent to the 90-day period must generally
replicate exactly the proportionate relationship among the number of shares of
each Security in the Portfolio at the end of the initial 90-day period. The
ability to acquire each Security at the same time will generally depend upon the
Security's availability and any restrictions on the purchase of that Security
under the federal securities laws or otherwise.
Additional Units may also be created by the deposit of cash (including a
letter of credit) with instructions to purchase additional Securities. This
practice could cause both existing and new investors to experience a dilution of
their investments and a reduction in their anticipated income because of price
fluctuations in the Securities between the time of the cash deposit and the
actual purchase of the additional Securities and because the associated
brokerage fees will be an expense of the Portfolio. To minimize the risk of
price fluctuations when purchasing Securities, the Portfolio will try to
purchase Securities as close to the evaluation time or at prices as close to the
evaluated prices as possible. The Portfolio may also enter into program trades
with unaffiliated broker/dealers, which may have the effect of increasing
brokerage commissions, while reducing market risk.
1
<PAGE>
PORTFOLIO SUPERVISION
The Portfolio follows an investment strategy that buys stocks and generally
holds them for one year, in contrast to the frequent portfolio changes of a
managed fund based on economic, financial and market analyses. Although the
Portfolio is regularly reviewed, because of the strategy, the Portfolio is
unlikely to sell any of the Securities other than to satisfy redemption of
Units, or to cease buying additional shares in connection with the issuance of
Additional Units. More specifically, adverse developments concerning a Security,
including the adverse financial condition of the issuer, the institution of
legal proceedings against the issuer, failure to maintain a current dividend
rate, or a decline in the price or the occurrence of other market or credit
factors (including a public tender offer or a merger or acquisition transaction)
that might otherwise make retention of the Security detrimental to the interest
of investors, will generally not cause the Portfolio to dispose of a Security or
cease buying it. Furthermore, the Portfolio will likely continue to hold a
Security and purchase additional shares even though the research analyst's
opinion may have changed subsequent to the initial date of deposit.
RISK FACTORS
An investment in the Fund entails certain risks, including the risk that
the value of your investment will decline if the financial condition of the
issuers of the Securities becomes impaired or if the general condition of the
stock market worsens. The rights of holders of common stocks to receive payments
from the issuer are generally inferior to the rights of creditors of, or holders
of debt obligations or preferred stocks issued by, the issuer. Moreover, because
common stocks do not represent an obligation of the issuer they do not offer any
assurance of income or provide the degree of protection of capital provided by
debt securities. Common stocks in general are susceptible to general stock
market movements and to volatile increases and decreases in value as market
confidence in and perceptions of issuers change. Equity markets can be affected
by unpredictable factors including expectations regarding government, economic,
monetary and fiscal policies, inflation and interest rates, economic expansion
or contraction, and global or regional political, economic or banking crises.
The Sponsor cannot predict the direction or scope of any of these factors.
Additionally, equity markets have been at historically high levels and no
assurance can be given that these levels will continue. There can be no
assurance that the Portfolio will be effective in achieving its objective over
the one-year life of the Fund or that future portfolios selected through this
process during consecutive one-year periods will meet their objectives. The
Portfolio is not designed to be a complete investment program.
LIQUIDITY
Whether or not the Securities are listed on a national securities exchange,
the principal trading market for the Securities may be in the over-the-counter
market. As a result, the existence of a liquid trading market for the Securities
may depend on whether dealers will make a market in the Securities. There can be
no assurance that a market will be made for any of the Securities, that any
market for the Securities will be maintained or of the liquidity of the
Securities in any markets made. In addition, the Fund may be restricted under
the Investment Company Act of 1940 from selling Securities to the Sponsor. The
price at which the Securities may be sold to meet redemptions and the value of
the Fund will be adversely affected if trading markets for the Securities are
limited or absent.
LITIGATION AND LEGISLATION
The Sponsor does not know of any pending litigation as of the initial date
of deposit that might reasonably be expected to have a material adverse effect
on the Fund, although pending litigation may have a material adverse effect on
the value of Securities in the Fund. In addition, at any time after the initial
date of deposit, litigation may be initiated on a variety of grounds, or
legislation may be enacted, affecting the Securities in the Portfolio or the
issuers of the Securities. Changing approaches to regulation may have a negative
impact on certain companies represented in the Portfolio. There can be no
assurance that future litigation, legislation, regulation or deregulation will
not have a material adverse effect on the Portfolio or will not impair the
ability of the issuers of the Securities to achieve their business goals. From
time to time Congress considers proposals to reduce the rate of the
dividends-received deduction. This type of legislation, if enacted into law,
would adversely affect the after-tax return to investors who can take advantage
of the deduction. See Taxes.
LIFE OF THE FUND; FUND TERMINATION
The size and composition of the Portfolio will be affected by the level of
redemptions of Units that may occur from time to time. Principally, this will
depend upon the number of investors seeking to sell or redeem their Units or
2
<PAGE>
participating in a rollover. The Portfolio will be terminated no later than the
mandatory termination date specified in Part A of the Prospectus. It will
terminate earlier upon the disposition of the last Security or upon the consent
of investors holding 51% of the Units. The Portfolio may also be terminated
earlier by the Sponsor once its total assets have fallen below the minimum value
specified in Part A of the Prospectus. A decision by the Sponsor to terminate
the Portfolio early, which will likely be made following the rollover, will be
based on factors such as the size of the Portfolio relative to its original
size, the ratio of Portfolio expenses to income, and the cost of maintaining a
current prospectus.
Notice of impending termination will be provided to investors and
thereafter units will no longer be redeemable. On or shortly before termination,
the Trustee will seek to dispose of any Securities remaining in the Portfolio
although any Security unable to be sold at a reasonable price may continue to be
held by the Trustee in a liquidating trust pending its final disposition. A
proportional share of the expenses associated with termination, including
brokerage costs in disposing of Securities, will be borne by investors remaining
at that time. This may have the effect of reducing the amount of proceeds those
investors are to receive in any final distribution.
HOW TO BUY UNITS
Units are available from the Sponsor, Underwriter and other broker-dealers
at the Public Offering Price. The Public Offering Price varies each Business Day
with changes in the value of the Portfolio and other assets and liabilities of
the Fund.
PUBLIC OFFERING PRICE
Units are charged a combination of Initial and Deferred Sales Charges
equal, in the aggregate, to a maximum charge of 2.75% of the public offering
price or, for quantity purchases of units of all Select Portfolios by an
investor and the investor's spouse and minor children, or by a single trust
estate or fiduciary account, made on a single day, the following percentages of
the public offering price:

APPLICABLE SALES CHARGE
(GROSS UNDERWRITING PROFIT)
------------------------------------
AS % OF PUBLIC AS % OF NET
AMOUNT PURCHASED OFFERING PRICE AMOUNT INVESTED
- ---------------------------- ----------------- -----------------
Less than $50,000........... 2.75% 2.778%
$50,000 to $99,999.......... 2.50 2.519
$100,000 to $249,999........ 2.00 2.005
$250,000 to $999,999........ 1.75 1.750
$1,000,000 or more.......... 1.00 1.000

The Deferred Sales Charge is a monthly charge of $1.75 per 1,000 units and
is accrued in ten monthly installments commencing on the date indicated in part
A of this Prospectus. Units redeemed or repurchased prior to the accrual of the
final Deferred Sales Charge installment will have the amount of any remaining
installments deducted from the redemption or repurchase proceeds or deducted in
calculating an in-kind redemption, although this deduction will be waived in the
event of the death or disability (as defined in the Internal Revenue Code) of an
investor. The Initial Sales Charge is equal to the aggregate sales charge,
determined as described above, less the aggregate amount of any remaining
installments of the Deferred Sales Charge.
It is anticipated that Securities will not be sold to pay the Deferred
Sales Charge until after the date of the last installment. Investors will be at
risk for market price fluctuations in the Securities from the several
installment accrual dates to the dates of actual sale of Securities to satisfy
this liability.
Employees of the Sponsor and Sponsor affiliates and non-employee directors
of Merrill Lynch & Co. Inc. may purchase Units subject only to the Deferred
Sales Charge.
EVALUATIONS
Evaluations are determined by the Trustee on each Business Day. This
excludes Saturdays, Sundays and the following holidays as observed by the New
York Stock Exchange: New Year's Day, Martin Luther King, Jr. Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and
Christmas. If the Securities are listed on a national securities exchange or the
Nasdaq National Market, evaluations are generally based on closing sales prices
on that exchange or system (unless the Trustee deems these prices inappropriate)
or, if closing sales
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prices are not available, at the mean between the closing bid and offer prices.
If the Securities are not listed or if listed but the principal market is
elsewhere, the evaluation is generally determined based on sales prices of the
Securities on the over-the-counter market or, if sales prices in that market are
not available, on the basis of the mean between current bid and offer prices for
the Securities or for comparable securities or by appraisal or by any
combination of these methods. Neither the Sponsor nor the Trustee guarantees the
enforceability, marketability or price of any Securities.
NO CERTIFICATES
All investors are required to hold their Units in uncertificated form and
in 'street name' by their broker, dealer or financial institution at the
Depository Trust Company ('DTC').
HOW TO REDEEM OR SELL UNITS
You can redeem your Units at any time for net asset value. In addition, the
Sponsor has maintained an uninterrupted secondary market for Units for over 20
years and will ordinarily buy back Units at net asset value. The following
describes these two methods to redeem or sell Units in greater detail.
REDEEMING UNITS WITH THE TRUSTEE
You can always redeem your Units for net asset value. This can be done by
contacting your broker, dealer or financial institution that holds your Units in
street name. In certain instances, additional documents may be required such as
a trust instrument, certificate of corporate authority, certificate of death or
appointment as executor, administrator or guardian.
Within seven days after the receipt of your request containing the
necessary documents, a check will be mailed to you in an amount equal to the net
asset value of your Units. Because of the sales charge, market movements or
changes in the Portfolio, net asset value at the time you redeem your Units may
be greater or less than the original cost of your Units. Net asset value is
calculated each Business Day by adding the value of the Securities, declared but
unpaid dividends on the Securities, cash and the value of any other Fund assets;
deducting unpaid taxes or other governmental charges, accrued but unpaid Fund
expenses and any remaining deferred sales charges, unreimbursed Trustee
advances, cash held to redeem Units or for distribution to investors and the
value of any other Fund liabilities; and dividing the result by the number of
outstanding Units. After the initial offering period, net asset value will be
reduced to reflect the cost to the Fund of liquidating Securities to pay the
redemption price.
As long as the Sponsor is maintaining a secondary market for Units (as
described below), the Trustee will not actually redeem your Units but will sell
them to the Sponsor for net asset value. If the Sponsor is not maintaining a
secondary market, the Trustee will redeem your Units for net asset value or will
sell your Units in the over-the-counter market if the Trustee believes it will
obtain a higher net price for your Units. If the Trustee is able to sell the
Units for a net price higher than net asset value, you will receive the net
proceeds of the sale.
If cash is not available in the Fund's Income and Capital Accounts to pay
redemptions, the Trustee may sell Securities selected by the Sponsor based on
market and credit factors determined to be in the best interest of the Fund.
These sales are often made at times when the Securities would not otherwise be
sold and may result in lower prices than might be realized otherwise and may
also reduce the size and diversity of the Fund. If Securities are being sold
during a time when additional Units are being created by the purchase of
additional Securities (as described under Portfolio Selection), Securities will
be sold in a manner designed to maintain, to the extent practicable, the
proportionate relationship among the number of shares of each Security in the
Portfolio.
Any investor owning Units representing Securities with a value of at least
$125,000 who redeems those Units prior to the rollover notification date
indicated in Part A of the Prospectus may, in lieu of cash redemption, request
distribution in kind of an amount and value of Securities per Unit equal to the
otherwise applicable Redemption Price per Unit. Generally, whole shares of each
Security together with cash from the Capital Account equal to any fractional
shares to which the investor would be entitled (less any Deferred Sales Charge
payable) will be paid over to a distribution agent and either held for the
account of the investor or disposed of in accordance with instructions of the
investor. Any brokerage commissions on sales of Securities in connection with
in-kind redemptions will be borne by the redeeming investors. The in-kind
redemption option is subject to all applicable legal restrictions and may be
terminated by the Sponsor at any time upon prior notice to investors.
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Redemptions may be suspended or payment postponed (i) if the New York Stock
Exchange is closed (other than customary weekend and holiday closings), (ii) if
the SEC determines that trading on the New York Stock Exchange is restricted or
that an emergency exists making disposal or evaluation of the Bonds not
reasonably practicable or (iii) for any other period permitted by SEC order.
SPONSOR'S SECONDARY MARKET FOR UNITS
The Sponsor, while not obligated to do so, will buy back Units at net asset
value without any other fee or charge as long as they are maintaining a
secondary market for Units. Because of the sales charge, market movements or
changes in the portfolio, net asset value at the time you sell your Units may be
greater or less than the original cost of your Units. You should consult your
financial professional for current market prices to determine if other
broker-dealers or banks are offering higher prices for Units.
The Sponsor may discontinue the secondary market for Units without prior
notice. Regardless of whether the Sponsor maintains a secondary market, you have
the right to redeem your Units for net asset value, as described above.
ROLLOVER
In lieu of redeeming their Units or receiving liquidation proceeds upon the
termination of the Fund, investors may elect, by written notice to the Trustee
prior to the rollover notification date indicated in Part A, to apply their
proportional interest in the Securities and other assets of the Fund toward the
purchase of units of a new Select Year Ahead Portfolio (if available). It is
expected that the terms of any new portfolio, including this rollover feature,
will be substantially the same as those of the Fund.
A rollover of an investor's units is accomplished by the in-kind redemption
of his Units of the Fund followed by the sale of the underlying Securities by a
distribution agent on behalf of participating investors and the reinvestment of
the sale proceeds (net of brokerage fees, governmental charges and other sale
expenses) in units of the new portfolio at their net asset value.
The Sponsor intends to sell the distributed Securities, on behalf of the
distribution agent, as quickly as practicable and then to create units of the
new portfolio as quickly as possible, subject in both cases to the Sponsor's
sensitivity that the concentrated sale and purchase of large volumes of
securities may affect market prices in a manner adverse to the interest of
investors. Accordingly, the Sponsor may, in its sole discretion, undertake a
more gradual sale of the distributed Securities and a more gradual creation of
units of the new portfolio to help mitigate any negative market price
consequences caused by this large volume of securities trades. In order to
minimize potential losses caused by market movement during the rollover period,
the Sponsor may enter into program trades, which might increase brokerage
commissions payable by investors. There can be no assurance, however, that any
trading procedures will be successful or might not result in less advantageous
prices. Pending the investment of rollover proceeds in the securities to
comprise the new portfolio, those moneys may be uninvested for up to several
days. For any Securities in the Portfolio that will also be in the portfolio of
the new Series, a direct sale of those securities between the two funds is now
permitted pursuant to an SEC exemptive order. These sales will be effected at
the securities' closing sales prices on the exchanges where they are principally
traded, free of any brokerage costs.
Investors participating in the rollover may realize taxable capital gain on
the rollover but may not be entitled to a deduction for capital loss recognized
on the rollover and, because of the rollover procedures, will not receive a cash
distribution with which to pay those taxes. Investors should consult their own
tax advisers in this regard. Investors who do not participate will continue to
hold their Units until the termination of the Fund; however, depending upon the
extent of participation in the rollover, the aggregate size of the Fund may be
sharply reduced resulting in a significant increase in per Unit expenses.
The Sponsor may, in its sole discretion and without penalty or liability to
investors, decide not to sponsor a new portfolio or to modify the terms of the
rollover. Prior notice of any decision would be provided to investors.
The Division of Investment Management of the SEC is of the view that the
rollover option constitutes an 'exchange offer', for the purposes of Section
11(c) of the Investment Company Act of 1940, and would therefore be prohibited
absent an exemptive order. The Sponsor has received exemptive orders under
Section 11(c) which it believes permit it to offer the rollover, but no
assurance can be given that the SEC will concur with the Sponsor's position and
additional regulatory approvals may be required.
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INCOME, DISTRIBUTIONS AND REINVESTMENT
INCOME AND DISTRIBUTIONS
Although current dividend income is not an objective of the Fund and it is
anticipated that expenses will exceed available income, the annual income per
Unit will depend primarily upon the amount of dividends declared and paid by the
issuers of the Securities and changes in the expenses of the Fund and, to a
lesser degree, upon the level of purchases of additional Securities and sales of
Securities. There is no assurance that dividends on the Securities will continue
at their current levels or be declared at all.
Each Unit receives an equal share of distributions of dividend income net
of estimated expenses. Because dividends on the securities are not received at a
constant rate throughout the year, any distribution may be more or less than the
amount then credited to the income account. Dividends received are credited to
an Income Account and other receipts to a Capital Account. A Reserve Account may
be created by withdrawing from the Income and Capital Accounts amounts
considered appropriate by the Trustee to reserve for any material amount that
may be payable out of the Fund. Funds held by the Trustee in the various
accounts do not bear interest. In addition, distributions of amounts necessary
to pay the Deferred Sales Charge will be made from the Capital Account to an
account maintained by the Trustee for purposes of satisfying investors' sales
charge obligations. Although the Sponsor may collect the Deferred Sales Charge
monthly, to keep Units more fully invested the Sponsor currently does not
anticipate sales of Securities to pay the Deferred Sales Charge until after the
rollover notification date. Proceeds of the disposition of any Securities not
used to pay Deferred Sales Charge or to redeem Units will be held in the Capital
Account and distributed following liquidation of the Fund.
REINVESTMENT
Any income and principal distributions on Units may be reinvested by
participating in the Fund's reinvestment plan. Under the plan, the Units
acquired for investors will be either Units already held in inventory by the
Sponsor or new Units created by the Sponsor's deposit of additional Securities,
contracts to purchase additional Securities or cash (or a bank letter of credit
in lieu of cash) with instructions to purchase additional Securities. Deposits
or purchases of additional Securities will generally be made so as to maintain
the then existing proportionate relationship among the number of shares of each
Security in the Fund. Units acquired by reinvestment will not be subject to the
initial sales charge but will be subject to any remaining installments of
Deferred Sales Charge. The Sponsor reserves the right to amend, modify or
terminate the reinvestment plan at any time without prior notice. Investors
holding Units in 'street name' should contact their broker, dealer or financial
institution if they wish to participate in the reinvestment plan.
FUND EXPENSES
Estimated annual Fund expenses are listed in Part A of the Prospectus; if
actual expenses exceed the estimate, the excess will be borne by the Fund. To
the extent that expenses exceed the amount available in the Income Account, the
Trustee is authorized to sell Securities and pay the excess expenses from the
Capital Account. The estimated expenses do not include the brokerage commissions
payable by the Fund in purchasing and selling Securities. The Trustee's Fee
shown in Part A of this Prospectus assumes that the Portfolio will reach a size
estimated by the Sponsor and is based on a sliding scale that reduces the
Trustee's fee as the size of the Portfolio increases. The Trustee's annual fee
is payable in monthly installments. The Trustee also benefits when it holds cash
for the Fund in non-interest bearing accounts. Possible additional charges
include Trustee fees and expenses for extraordinary services, costs of
indemnifying the Trustee and the Sponsor, costs of action taken to protect the
Fund and other legal fees and expenses, Fund termination expenses and any
governmental charges. The Trustee has a lien on Fund assets to secure
reimbursement of these amounts and may sell Securities for this purpose if cash
is not available. The Sponsor receives an annual fee currently estimated at
$0.35 per 1,000 Units to reimburse it for the cost of providing Portfolio
supervisory services to the Fund. While the fee may exceed its costs of
providing these services to the Fund, the total supervision fees from all Series
of Equity Investor Fund will not exceed its costs for these services to all of
those Series during any calendar year. The Sponsor may also be reimbursed for
its costs of providing bookkeeping and administrative services to Defined Asset
Funds, currently estimated at $0.10 per 1,000 Units. The Trustee's and Sponsor's
fees may be adjusted for inflation without investors' approval.
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All or a portion of expenses incurred in establishing the Fund, including
the cost of the initial preparation of documents relating to the Fund, Federal
and State registration fees, the initial fees and expenses of the Trustee, legal
expenses and any other out-of-pocket expenses will be paid by the Fund and
amortized over the life of the Fund. Advertising and selling expenses will be
paid by the Sponsor at no charge to the Fund. Defined Asset Funds can be a cost-
effective way to purchase and hold investments. Annual operating expenses are
generally lower than for managed funds. Because Defined Asset Funds have no
management fees, limited transaction costs and no ongoing marketing expenses,
operating expenses are generally less than 0.25% a year. When compounded
annually, small differences in expense ratios can make a big difference in your
investment results.
TAXES
The following discussion addresses only the tax consequences of Units held
as capital assets and does not address the tax consequences of Units held by
dealers, financial institutions or insurance companies.
In the opinion of Davis Polk & Wardwell, special counsel for the Sponsors,
under existing law:
The Portfolio is not an association taxable as a corporation for federal
income tax purposes. Each investor will be considered the owner of a pro
rata portion of each Security in the Portfolio under the grantor trust
rules of Sections 671-679 of the Internal Revenue Code of 1986, as amended
(the 'Code'). Each investor will be considered to have received all of the
dividends paid on his pro rata portion of each Security when such dividends
are received by the Portfolio, regardless of whether such dividends are
used to pay a portion of Portfolio expenses or whether they are
automatically reinvested (see Reinvestment Plan).
Amounts considered to have been received by a corporate investor from
domestic corporations that constitute dividends for federal income tax
purposes will generally qualify for the dividends-received deduction, which
is currently 70%. Depending upon the particular corporate investor's
circumstances, limitations on the availability of the dividends-received
deduction may be applicable. Further, Congress from time to time considers
proposals that would adversely affect the after-tax return to investors
that can take advantage of the deduction. For example, the recently enacted
Taxpayer Relief Act of 1997 requires the holding period for the
dividends-received deduction (during which the investor's position may not
be hedged) to be satisfied immediately proximate to each ex-dividend date.
Investors are urged to consult their own tax advisers in this regard.
An individual investor who itemizes deductions will be entitled to
deduct his pro rata share of current Portfolio expenses only to the extent
that this amount together with the investor's other miscellaneous
deductions exceeds 2% of his adjusted gross income. The Code further
restricts the ability of an individual investor with an adjusted gross
income in excess of a specified amount (for 1997, $121,200 or $60,600 for a
married person filing a separate return) to claim itemized deductions
(including his pro rata share of Portfolio expenses).
The investor's basis in his Units will equal the cost of his Units,
including the initial sales charge. A portion of the sales charge is
deferred until the termination of the Portfolio or the redemption of the
Units. The proceeds received by an investor upon such event will reflect
deduction of the deferred amount (the 'Deferred Sales Charge') and a charge
for organizational expenses. The annual statement and the relevant tax
reporting forms received by investors will be based upon the amounts paid
to them, net of the Deferred Sales Charge and the charge for organizational
expenses. Accordingly, investors should not increase their basis in their
Units by the Deferred Sales Charge amount or any amount used to pay
organizational expenses.
An investor will generally recognize capital gain or loss when the
investor disposes of his Units (by sale, redemption or otherwise) or when
the Trustee disposes of the Securities from the Portfolio. However,
deductions will be disallowed for such losses realized by investors who
invest in a 1999 Year Ahead Portfolio ('rollover investor') within 30 days
after incurring such losses to the extent that the securities in that
series are substantially identical to the old Securities. Furthermore, an
investor will generally not recognize gain or loss upon the distribution of
a pro rata amount of each of the Securities by the Trustee to an investor
(or to his agent) in redemption of Units, except to the extent of cash
received in lieu of fractional shares. The redeeming investor's basis for
such Securities will be equal to his basis for the same Securities
(previously represented by his Units) prior to such redemption, and his
holding period for such Securities will include the period during which he
held his Units.
Net capital gain (the excess of net long-term capital gains over net
short-term capital losses) may be taxed at lower rates than ordinary income
for certain individual and other noncorporate taxpayers. A capital gain or
loss is long-term if the asset is held for more than one year and
short-term if held for one year or less. The deduction of
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capital losses is subject to limitations. The lower net capital gain tax
rate will be unavailable to those noncorporate investors who, as of the
mandatory termination date (or earlier termination of the Portfolio), have
held their units for less than a year and a day. Similarly, with respect to
noncorporate rollover investors, this lower rate will be unavailable if, as
of the beginning of the rollover period, those investors have held their
units for less than a year and a day. Investors will not be entitled under
the Taxpayer Relief Act of 1997 to the new 20% maximum federal tax rate for
capital gains derived from the Portfolio.
Under the income tax laws of the State and City of New York, the
Portfolio is not an association taxable as a corporation and the income of
the Portfolio will be treated as the income of the investors in the same
manner as for federal income tax purposes.
The foregoing discussion summarizes only certain U.S. federal and New
York State and City income tax consequences of an investment in Units by
investors who are U.S. persons, as defined in the Code. Foreign investors
(including nonresident alien individuals and foreign corporations) not
engaged in U.S. trade or business will generally be subject to 30%
withholding tax (or lower applicable treaty rate) on distributions.
Investors may be subject to taxation in New York or in other U.S. or
foreign jurisdictions and should consult their own tax advisers in this
regard.
* * * *
At the termination of the Portfolio, the Trustee will furnish to each
investor an annual statement containing information relating to the dividends
received by the Portfolio on the Securities, the cash proceeds received by the
Portfolio from the disposition of any Security (resulting from redemption or the
sale by the Portfolio of any Security), and the fees and expenses paid by the
Portfolio. The Trustee will also furnish annual information returns to each
investor and to the Internal Revenue Service.
RETIREMENT PLANS
This Series of Equity Investor Fund may be well suited for purchase by
Individual Retirement Accounts ('IRAs'), Keogh plans, pension funds and other
qualified retirement plans, certain of which are briefly described below.
Generally, capital gains and income received in each of the foregoing plans are
exempt from Federal taxation. All distributions from such plans are generally
treated as ordinary income but may, in some cases, be eligible for special 5 or
10 year averaging (prior to the year 2000) or tax-deferred rollover treatment.
Holders of Units in IRAs, Keogh plans and other tax-deferred retirement plans
should consult their plan custodian as to the appropriate disposition of
distributions. Investors considering participation in any of these plans should
review specific tax laws related thereto and should consult their attorneys or
tax advisers with respect to the establishment and maintenance of any of these
plans. These plans are generally offered by brokerage firms, including the
Sponsors of this Portfolio, and other financial institutions. Fees and charges
with respect to such plans may vary.
Retirement Plans for the Self-Employed--Keogh Plans. Units may be purchased
by retirement plans established for self-employed individuals, partnerships or
unincorporated companies ('Keogh plans'). The assets of a Keogh plan must be
held in a qualified trust or other arrangement which meets the requirements of
the Code. Keogh plan participants may also establish separate IRAs (see below)
to which they may contribute up to an additional $2,000 per year ($4,000 in a
spousal account).
Individual Retirement Account--IRA. Any individual can make use of a
qualified IRA arrangement for the purchase of Units. Any individual (including
one covered by an employer retirement plan) can make a contribution in an IRA
equal to the lesser of $2,000 ($4,000 in a spousal account) or 100% of earned
income; such investment must be made in cash. However, the deductible amount of
a contribution by an individual covered by an employer retirement plan will be
reduced if the individual's adjusted gross income exceeds $25,000 (in the case
of a single individual), $40,000 (in the case of a married individual filing a
joint return) or $200 (in the case of a married individual filing a separate
return). Under the Taxpayer Relief Act of 1997, these income threshholds will
gradually be increased by the year 2004 to $50,000 for a single individual and
$80,000 for a married individual filing jointly. Certain transactions which are
prohibited under Section 408 of the Code will cause all or a portion of the
amount in an IRA to be deemed to the distributed and subject to tax at that
time. Unless nondeductible contributions were made in 1987 or a later year, all
distributions from an IRA will be treated as ordinary income but generally are
eligible for tax-deferred rollover treatment. Taxable distributions made before
attainment of age 59 1/2, except in the case of the participant's death or
disability or where the amount distributed is part of a series of substantially
equal periodic (at least annual)
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payments that are to be made over the life expectancies of the participant and
his or her beneficiary, are generally subject to a surtax in an amount equal to
10% of the distribution. Under the Taxpayer Relief Act of 1997, the 10% surtax
will be waived for withdrawals for certain educational and first-time homebuyer
expenses. The Taxpayer Relief Act also provides, subject to certain income
limitations, for a special type of IRA under which contributions would be
non-deductible but distributions would be tax-free if the account were held for
at least five years and the account holder was at least 59 1/2 at the time of
the distribution.
Corporate Pension and Profit-Sharing Plans. A pension or profit-sharing
plan for employees of a corporation may purchase Units.
RECORDS AND REPORTS
The Trustee keeps a register of the names, addresses and holdings of all
investors. The Trustee also keeps records of the transactions of the Fund,
including a current list of the Securities and a copy of the Indenture, which
may be inspected by investors at reasonable times during business hours.
With each distribution, the Trustee includes a statement of the amounts of
income and any other receipts being distributed. Following the termination of
the Fund, the Trustee sends each investor of record a statement summarizing
transactions in the Fund's accounts including amounts distributed from them,
identifying Securities sold and purchased and listing Securities held and the
number of Units outstanding at termination and stating the Redemption Price per
1,000 Units at termination, and the fees and expenses paid by the Fund, among
other matters. Fund accounts may be audited by independent accountants selected
by the Sponsors and any report of the accountants will be available from the
Trustee on request.
TRUST INDENTURE
The Fund is a 'unit investment trust' created under New York law by a Trust
Indenture among the Sponsors and the Trustee. This Prospectus summarizes various
provisions of the Indenture, but each statement is qualified in its entirety by
reference to the Indenture.
The Indenture may be amended by the Sponsor and the Trustee without consent
by investors to cure ambiguities or to correct or supplement any defective or
inconsistent provision, to make any amendment required by the SEC or other
governmental agency or to make any other change not materially adverse to the
interest of investors (as determined in good faith by the Sponsors). The
Indenture may also generally be amended upon consent of investors holding 51% of
the Units. No amendment may reduce the interest of any investor in the Fund
without the investor's consent or reduce the percentage of Units required to
consent to any amendment without unanimous consent of investors. Investors will
be notified of the substance of any amendment.
The Trustee may resign upon notice to the Sponsor. It may be removed by
investors holding 51% of the Units at any time or by the Sponsor without the
consent of investors if it becomes incapable of acting or bankrupt, its affairs
are taken over by public authorities, or if under certain conditions the Sponsor
determines in good faith that its replacement is in the best interest of the
investors. The resignation or removal becomes effective upon acceptance of
appointment by a successor; in this case, the Sponsor will use its best efforts
to appoint a successor promptly; however, if upon resignation no successor has
accepted appointment within 30 days after notification, the resigning Trustee
may apply to a court of competent jurisdiction to appoint a successor.
If the Sponsor fails to perform its duties or becomes incapable of acting
or bankrupt or its affairs are taken over by public authorities, the Trustee may
appoint a successor Sponsor at reasonable rates of compensation, terminate the
Indenture and liquidate the Fund or continue to act as Trustee without a
Sponsor.
The Sponsor and the Trustee are not liable to investors or any other party
for any act or omission in the conduct of their responsibilities absent bad
faith, willful misfeasance, negligence (gross negligence in the case of the
Sponsor) or reckless disregard of duty. The Indenture contains customary
provisions limiting the liability of the Trustee.
MISCELLANEOUS
LEGAL OPINION
The legality of the Units has been passed upon by Davis Polk & Wardwell,
450 Lexington Avenue, New York, New York 10017, as special counsel for the
Sponsors.
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AUDITORS
The Statement of Condition in Part A of the Prospectus was audited by
Deloitte & Touche LLP, independent accountants, as stated in their opinion. It
is included in reliance upon that opinion given on the authority of that firm as
experts in accounting and auditing.
TRUSTEE
The Trustee and its address are stated on the back cover of the Prospectus.
The Trustee is subject to supervision by the Federal Deposit Insurance
Corporation, the Board of Governors of the Federal Reserve System and New York
State banking authorities.
SPONSOR
The Sponsor is a wholly-owned subsidiary of Merrill Lynch Co. Inc. The
Sponsor, or one of its predecessor corporations, has acted as Sponsor of a
number of series of unit investment trusts and as principal underwriter and
managing underwriter of other investment companies. The Sponsor, in addition to
participating as a member of various selling groups or as agent of other
investment companies, executes orders on behalf of investment companies for the
purchase and sale of securities of these companies and sells securities to these
companies in its capacities as broker or dealer in securities.
CODE OF ETHICS
The Sponsor has adopted a code of ethics requiring preclearance and
reporting of personal securities transactions by its personnel who have access
to information on Defined Asset Funds portfolio transactions. The code is
intended to prevent any act, practice or course of conduct which would operate
as a fraud or deceit on any Fund and to provide guidance to these persons
regarding standards of conduct consistent with the Sponsor's responsibilities to
the Funds.
PUBLIC DISTRIBUTION
During the initial offering period and thereafter to the extent additional
Units continue to be offered for sale to the public by means of this Prospectus,
Units will be distributed directly to the public by this Prospectus at the
Public Offering Price determined in the manner provided above or to selected
dealers who are members of the National Association of Securities Dealers, Inc.
at a concession not in excess of the maximum sales charge. The Sponsor intends
to qualify Units for sale in all states in which qualification is deemed
necessary through the Underwriting Account and by dealers who are members of the
National Association of Securities Dealers, Inc.. The Sponsor does not intend to
qualify Units for sale in any foreign countries and this Prospectus does not
constitute an offer to sell Units in any country where Units cannot lawfully be
sold.
UNDERWRITER'S AND SPONSOR'S PROFITS
Upon sale of the Units, the Sponsor will be entitled to receive sales
charges. The Sponsor also realizes a profit or loss on deposit of the Securities
equal to the difference between the cost of the Securities to the Fund (based on
the aggregate value of the Securities on their date of deposit) and the purchase
price of the Securities to the Sponsor plus commissions payable by the Sponsor.
In addition, the Sponsor or Underwriter may realize profits or sustain losses on
Securities it deposits in the Fund which were acquired from underwriting
syndicates of which it was a member. During the initial offering period, the
Sponsor also may realize profits or sustain losses as a result of fluctuations
after the initial date of deposit in the Public Offering Price of the Units. In
maintaining a secondary market for Units, the Sponsor will also realize profits
or sustain losses in the amount of any difference between the prices at which it
buys Units and the prices at which it resells these Units (which include the
sales charge) or the prices at which it redeems the Units. Cash, if any, made
available by buyers of Units to the Sponsor prior to a settlement date for the
purchase of Units may be used in the Sponsor's business to the extent permitted
by Rule 15c3-3 under the Securities Exchange Act of 1934 and may be of benefit
to the Sponsor.
PERFORMANCE INFORMATION
Total returns, average annualized returns or cumulative returns for various
periods of the current or one or more prior Select Portfolios may be included
from time to time in advertisements, sales literature and reports to current and
prospective investors. Total return shows changes in unit price during the
period plus reinvestment of dividends and capital gains, divided by the maximum
public offering price. Average annualized returns show the average return
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for stated periods for longer than a year. Figures reflect deduction of all
Portfolio expenses and, unless otherwise stated, the maximum sales charge. No
provision is made for any income taxes payable. Investors should bear in mind
that this represents past performance and is no assurance of the future results
of any current or future Portfolio.
Past performance of any series may not be indicative of results of future
series. Fund performance may be compared to the performance of the DJIA, the S&P
500 Composite Price Stock Index, the S&P MidCap 400 Index, the S&P 500/Barra
Growth Index, the average growth mutual fund or performance data from
publications such as Lipper Analytical Services, Inc., Morningstar Publications,
Inc., Money Magazine, The New York Times, U.S. News and World Report, Barron's,
Business Week, CDA Investment Technology, Inc., Forbes Magazine or Fortune
Magazine.
DEFINED ASSET FUNDS
For decades informed investors have purchased unit investment trusts for
dependability and professional selection of investments. Defined Asset Funds'
philosophy is to allow investors to 'buy with knowledge' (because, unlike
managed funds, the portfolio is generally fixed) and 'hold with confidence'
(because the portfolio is professionally selected and regularly reviewed).
Defined Asset Funds offers an array of simple and convenient investment choices,
suited to fit a wide variety of personal financial goals--a buy and hold
strategy for capital accumulation, such as for children's education or
retirement, or attractive, regular current income consistent with the
preservation of principal. Unit investment trusts are particularly suited for
the many investors who prefer to seek long-term profits by purchasing sound
investments and holding them, rather than through active trading. Few
individuals have the knowledge, resources or capital to buy and hold a
diversified portfolio on their own; it would generally take a considerable sum
of money to obtain the breadth and diversity that Defined Asset Funds offer.
Your investment objectives may call for a combination of Defined Asset Funds.
One of the most important investment decisions you face may be how to
allocate your investments among asset classes. Diversification among different
kinds of investments can balance the risks and rewards of each one. Most
investment experts recommend stocks for long-term capital growth. Long-term
corporate bonds offer relatively high rates of interest income. By purchasing
both defined equity and defined bond funds, investors can receive attractive
current income, as well as growth potential, offering some protection against
inflation. From time to time various advertisements, sales literature, reports
and other information furnished to current or prospective investors may present
the average annual compounded rate of return of selected asset classes over
various periods of time, compared to the rate of inflation over the same
periods.
Investors may pursue investment growth to meet long-term goals such as
children's education or retirement. But they are faced with decisions of
selecting stock groups, choosing individual stocks, determining when to buy and
sell and how to reinvest sales proceeds. Growth stocks--those whose price is
expected to appreciate above average usually because of superior growth in
earnings per share--can be difficult to select successfully because their prices
tend to be more volatile than more established stocks and, by the time they are
discovered by ordinary investors, their prices may have already increased beyond
attractive levels or may be susceptible to dramatic declines if actual
performance is less than anticipated.
EXCHANGE OPTION
You may exchange Fund Units for units of other Select Series Portfolios,
subject only to the remaining deferred sales charge on the units received.
Holders of units of any Select Portfolio or any other Defined Asset Fund with a
regular maximum sales charge of at least 3.50%, or of any unaffiliated unit
trust with a regular maximum sales charge of at least 3.0%, may exchange those
units for Units of this Fund at their relative net asset values, subject only to
the remaining Deferred Sales Charge on Fund Units.
To make an exchange, you should contact your financial professional to find
out what suitable exchange funds are available and to obtain a prospectus. You
may acquire units of only those exchange funds in which the Sponsor is
maintaining a secondary market and which are lawfully for sale in the state
where you reside. Except for the reduced sales charge, an exchange is a taxable
event normally requiring recognition of any gain or loss on the units exchanged.
However, the Internal Revenue Service may seek to disallow a loss if the
portfolio of the units acquired is not materially different from the portfolio
of the units exchanged; you should consult your own tax adviser. If the proceeds
of units exchanged are insufficient to acquire a whole number of exchange fund
units, you may pay the difference in cash (not exceeding the price of a single
unit acquired).
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<PAGE>
As the Sponsor is not obligated to maintain a secondary market in any
series, there can be no assurance that units of a desired series will be
available for exchange. The Exchange Option may be amended or terminated at any
time without notice.
SUPPLEMENTAL INFORMATION
Upon writing or calling the Trustee shown on the back cover of this
Prospectus, investors will receive without charge supplemental information about
the Fund, which has been filed with the SEC. The supplemental information
includes more detailed risk factor disclosure about the types of securities that
may be part of the Portfolio and general information about the structure and
operation of the Fund.
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Def ined
Asset FundsSM

SPONSOR: EQUITY INVESTOR FUND
Merrill Lynch, SELECT SERIES
Pierce, Fenner & Smith Incorporated1998 YEAR AHEAD PORTFOLIO
Defined Asset Funds
P.O. Box 9051
Princeton, NJ 08543-9051
(609) 282-8500 This Prospectus does not contain all of the
TRUSTEE: information with respect to the investment
The Chase Manhattan Bank company set forth in its registration
Customer Service Retail Department statement and exhibits relating thereto which
Bowling Green Station have been filed with the Securities and
P.O. Box 5187 Exchange Commission, Washington, D.C. under
New York, NY 10274-5187 the Securities Act of 1933 and the Investment
1-800-323-1508 Company Act of 1940, and to which reference
is hereby made. Copies of filed material can
be obtained from the Public Reference Section
of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates.
The Commission also maintains a Web site that
contains information statements and other
information regarding registrants such as
Defined Asset Funds that file electronically
with the Commission at http://www.sec.gov.
------------------------------
No person is authorized to give any
information or to make any representations
with respect to this investment company not
contained in its registration statement and
exhibits relating thereto; and any
information or representation not contained
therein must not be relied upon as having
been authorized.
------------------------------
When Units of this Fund are no longer
available or for investors who may reinvest
into subsequent Select Year Ahead Portfolios,
this Prospectus may be used as a preliminary
prospectus for a future series, and investors
should note the following:
Information contained herein is subject to
amendment. A registration statement relating
to securities of a future series 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 Prospectus 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 qualification under the securities laws of
any such State.

11350--12/97