Defined Asset Funds
Global Diversification with the Select Ten Strategies
DJIA Portfolio
Hong Kong Portfolio
United Kingdom Portfolio
Japan Portfolio
Simple Investment Strategies
for Global Diversification
and Total Return
Merrill Lynch
In recent years, many American investors have begun investing globally to seek
diversification and additional investment opportunities outside the U.S. After
all, U.S. capital markets today represent less than 40% of total world
capitalization--compare that to over 65% in 1970.
Select Ten: Your Passport to Global Diversification
By including some international stocks in an equity portfolio, investors may
reduce overall market volatility while increasing total return.
The United Kingdom, Japan, Hong Kong and the United States... each of these
countries offer potential growth opportunities. The Select Ten Portfolios can
be a convenient and cost effective way to help you diversify globally.
The Portfolios
Investing in the ten highest dividend-yielding stocks in a certain index for
about one year is a time-tested Strategy that seeks attractive total return.
This Strategy is the basis for Defined Asset Funds(sm) Select ten Series.
The Portfolios currently available in the Select Ten Series feature these
indices:
Dow Jones Industrial Average* (DJIA Strategy)
The United Kingdom's Financial Time Industrial
Ordinary Share Index* (FT Strategy)
Hong Kong's Hang Seng Index* (Hang Seng Strategy)
Japan's Nikkei 225 Index* (Nikkei Strategy)
*These names are the property of their respective publishers. None of these
firms is affiliated with, nor participated in the creation of any Select Ten
Portfolio or the selection of these stocks and has neither reviewed nor
approved any information in this brochure or the prospectus relating to the
Portfolio.
The Strategy
Each Select Ten Portfolio consists of approximately equal values of the ten
stocks in its related index having the highest dividend yield shortly before
the initial offering date (the "Strategy Stocks") and holds them for about a
year. The Portfolios will remain relatively fixed during this time. After one
year, the Portfolios will liquidate. You may choose to reinvest your proceeds
into the next portfolio of the then-current Strategy Stocks, if available, or
you can take the cash.
<TABLE>
<CAPTION>
Strategy Illustrations
DJIA Portfolio Hong Kong Portfolio
January 1, 1977-December 31, 1996 January 1, 1978-December 31,1996
Year DJIA Strategy Stocks Year Hang Seng Index Strategy Stocks
Total Return Total Return Total Return Total Return
<S> <C> <C> <C> <C> <C>
1977 -12.71% -0.83% 1977 N/A N/A
1978 2.69 0.16 1978 23.51% 28.04
1979 10.52 12.35 1979 78.33 82.28
1980 21.41 26.37 1980 65.83 41.40
1981 -3.40 7.47 1981 -11.07 -3.86
1982 25.79 25.46 1982 -47.79 -38.97
1983 25.68 38.46 1983 -0.89 -7.48
1984 1.06 7.34 1984 42.54 65.32
1985 32.78 28.63 1985 51.10 47.52
1986 26.91 34.57 1986 51.16 60.49
1987 6.02 6.97 1987 -6.73 3.03
1988 15.95 21.50 1988 20.60 34.04
1989 31.71 27.30 1989 10.19 9.41
1990 -0.57 -7.94 1990 11.99 6.11
1991 23.93 33.37 1991 48.25 48.51
1992 7.34 8.32 1992 33.63 38.94
1993 16.72 26.92 1993 121.11 106.99
1994 4.95 3.89 1994 -28.83 -31.45
1995 36.48 36.48 1995 26.95 16.11
1996 28.57 27.94 1996 37.73 27.82
Average 14.27% 17.41% Average 21.65% 22.71%
</TABLE>
[A mountain chart entitled "Hypothetical growth of $10,000 invested in 1977
through 1996", shows that if you had invested $10,000 in 1977 and held that
capital through 1995, your investment would have reached $748,813. The x
axis reflects dollar amounts, starting with $0. The first amount is $100,000
and increases in $100,000 increments, until the amount reaches $700,000. The
y axis reflects years, starting with 1977 increasing in two year increments
and ending with 1995. The z axis reflects dollar amounts starting with
$123,558 then $143,997, $212,272, $247,825, $391,785, $414,022, $488,496
ending with $748,813. Solid and dotted lines indicates the components of the
chart. A solid orange line represents the Nikkei Strategy Stocks, a dotted
orange line represents the Nikkei 225 Index; a solid purple line represents
the FT Strategy Stocks, a dotted purple line represents the FT 30 Index; a
solid green line represents the Hang Seng Strategy Stocks, a dotted green line
represents the Hang Seng Index; a solid dark blue line represents the DJIA
Strategy Stocks, a dotted dark blue line represents the DJIA.]
The figures in these charts and graphs represent hypothetical performance of
the Strategy Stocks (not any actual Portfolio) with the actual performance of
their related Indexes. Each Strategy would have underperformed its related
index in certain years and past performance is no guarantee of future results.
The results shown assume that all dividends during each year are reinvested at
the end of that year, and do not reflect all sales charges, expenses and
commissions. Actual Portfolio performance will also differ from Strategy
Stocks because the Portfolios are established and liquidated at different
times during the year, they normally purchase and sell stocks 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 weighted
equally. For more complete discussion of Strategy Stocks and Portfolio
performance, please speak to your financial professional.
<TABLE>
<CAPTION>
United Kingdom Portfolio Japan Portfolio
January 1, 1977-December 31, 1996 January 1, 1977-December 31,1996
Year FT 30 Index Strategy Stocks Year Nikkei 225 Index Strategy Stocks
Total Return Total Return Total Return Total Return
<S> <C> <C> <C> <C> <C>
1977 61.92% 87.27% 1977 21.55% 54.28
1978 9.92 17.73 1978 55.32 72.10
1979 3.59 4.76 1979 -10.00 -0.89
1980 31.77 30.15 1980 29.47 38.93
1981 -5.30 -6.26 1981 2.20 18.44
1982 0.42 44.03 1982 -0.77 -2.54
1983 21.94 42.06 1983 27.08 31.04
1984 2.15 5.50 1984 8.92 3.11
1985 54.74 78.64 1985 44.19 53.01
1986 24.36 32.88 1986 83.78 77.83
1987 38.99 48.10 1987 50.71 93.67
1988 6.74 11.38 1988 36.57 63.04
1989 22.80 28.71 1989 12.80 22.96
1990 10.29 9.26 1990 -34.79 -40.99
1991 14.65 16.57 1991 5.56 6.90
1992 -2.33 4.27 1992 -25.76 -16.17
1993 18.40 37.69 1993 15.94 21.52
1994 1.89 5.46 1994 28.30 27.99
1995 17.63 10.83 1995 -2.30 -4.98
1996 20.05 14.29 1996 -12.43 -16.78
Average* 16.51% 24.08% Average 13.39% 20.13%
<FN>
*Average return represents annualized total return for the entire period.
</TABLE>
Prior Select Ten Portfolio Performance
The following table shows average annual total returns (price changes plus
dividends reinvested, divided by the initial public offering price) converted
into U.S. dollars and reflects all sales charges and expenses but not taxes.
The first lines of each Portfolio show the results that could have been
obtained by investing in the first fund of each established series and rolling
over each year into a successor fund. The last three lines show the return of
the latest completed Fund of each Series.
<TABLE>
<CAPTION>
Series Inception Return
DJIA Portfolio
Series From Inception through 12/31/96
<S> <C> <C>
Series A 1/3/92 15.62%
Series B 5/17/91 16.01%
Series C 9/1/92 18.92%
<CAPTION>
Performance of the last completed fund of each established Series
<S> <C> <C>
1995 Series A 1/9/95-2/23/96 34.42%
1995 Series B 5/10/95-6/28/96 25.30%
1995 Series C 9/12/95-10/31/96 28.94%
<CAPTION>
Hong Kong Portfolio
Series From Inception through 12/31/96
<S> <C> <C>
Series A 1/5/94 -3.73%
Series B* 4/23/96 12.20%
Series C** 6/21/93 10/52%
Series D*** 9/28/93 4.06%
<CAPTION>
Performance of the last completed fund of each established Series
<S> <C> <C>
1995 Series A 1/6/95-2/23/96 35.63%
1995 Series B 5/10/95-6/28/96 17/99%
1995 Series C 9/11/95-10/31/96 18.96%
<CAPTION>
United Kingdom Portfolio
Series From Inception through 12/31/96
<S> <C> <C>
Series A 1/5/94 3.92%
Series B 6/21/93 7.75%
Series C 9/28/93 5.68%
<CAPTION>
Performance of the last completed fund of each established Series
<S> <C> <C>
1995 Series A 1/6/95-2/23/96 5.75%
1995 Series B 5/10/95-6/28/96 -10.03%
1995 Series C 9/11/95-10/31/96 1.02%
<CAPTION>
Japan Portfolio
Series From Inception through 12/31/96
<S> <C> <C>
1996 Series A 1/22/96 -20.65%
<FN>
* These figures are not annualized
** Hong Kong 95B (HST95B) rolled into Hong Kong 96C (HSTT96C)
*** Hong Kong 95C (HST95C) rolled into Hong Kong 96D (HST96D)
</TABLE>
Defining Your Risks
There can be no assurance that a Portfolio will achieve its objective. Prices
and yields will fluctuate. Strategy Stocks may have higher yields because they
or their industries are experiencing financial difficulty or are out of favor.
The Hong Kong and Japan Portfolios may be considered speculative, and should
not be considered a complete investment program. Investing in several Select
Ten Strategies may not be appropriate for investors seeking either
preservation of capital or high current income, nor would international
portfolios be appropriate for investors who are unable or unwilling to assume
the special risks, including higher price volatility and currency rate
fluctuations, associated with investments in international equities.
Begin Your Global Journey
Ask your financial professional for information on the latest Select Ten
offerings. He or she will be happy to provide you with a brochure and a free
prospectus containing more complete information on any of the Portfolios,
including all charges and expenses, and the special considerations associated
with international investing such as foreign currency and political
developments. Read the prospectus carefully before investing.
Units of the next Series are not yet available. Information herein is subject
to amendment. A registration statement relating to these securities 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 of the registration
statement becomes effective. This brochure shall not constitute an offer to
sell or the solicitation of an offer to buy, nor shall there be any sale of
these securities in any state in which such an offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of such states.
