IRA Ideal!
Defined Asset Funds[SM]
Select Ten Portfolio
1998
SERIES 4
A Defined Strategy for Total Return
[ML logo] Merrill Lynch
SELECTING INVESTMENTS
FOR YOUR PORTFOLIO CAN BE
COMPLICATED--UNLESS YOU
HAVE A STRATEGY.
The Select Ten Strategy
The Portfolio seeks total return by holding the ten highest dividend-yielding
stocks of the Dow Jones Industrial Average (DJIA)(*) for about one year (the
"Strategy").
The Portfolio looks for potential values in the equity market by investing in
established companies whose prices may be depressed. It consists of
approximately equal values of the ten stocks in the DJIA with the highest
dividend yields at the time of the offering.
Each year, we intend to reapply the screening process to select a new
Portfolio. You can reinvest in the next Portfolio, if available, at a reduced
sales charge, or you can redeem your investment. Although each Portfolio is a
one-year investment, we recommend you stay with the Strategy for at least
three to five years for potentially more consistent results.
- -------------------
(*) 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 this brochure or the prospectus relating to the
Portfolio. "S&P 500" is a trademark of The McGraw-Hill Companies, Inc.
It's Convenient
Invest in a fixed Portfolio of widely held stocks with just one purchase and
enjoy the advantages of:
o Low cost. The minimum investment is about $250.
o Quarterly dividends. You will receive four consolidated checks per year,
not 40 for the 10 stocks.
o Reinvestment. You may choose to reinvest your dividends at a reduced sales
charge to compound your income.
o No sell decisions. You are buying and holding for about a year, a Portfolio
of established companies with relatively high dividend yields.
Select Ten Portfolio--1998 Series 4(1)
Name of Issuer Ticker Symbol Current Dividend Yield(2)
1. J.P. Morgan & Company, Inc. JPM 4.37%
2. Philip Morris Companies, Inc. MO 4.19
3. General Motors Corporation GM 3.55
4. Chevron Corporation CHV 3.13
5. Minnesota Mining & Manufacturing MMM 3.13
Company
6. Caterpillar Inc. CAT 2.61
7. Goodyear Tire & Rubber Company GT 2.59
8. International Paper Company IP 2.52
9. Exxon Corporation XON 2.48
10. AT&T Corporation T 2.48
The Portfolio does not reflect the research opinions or any buy or sell
recommendations of any of the Sponsors.
(1) Initial date of deposit--September 8, 1998.
(2) Current Dividend Yield for each security was calculated by annualizing the
last quarterly or semi-annual ordinary dividend received on that security and
dividing the result by its market value as of the close of trading on
September 4, 1998. There can be no assurance that future dividends, if any,
will be maintained at the indicated rates.
Past Performance of Prior Select Ten Portfolios
The chart below shows average annual total returns for the following Series,
which assume annual "rollovers" into the next Portfolio. We've also included
returns for the most recently completed Portfolio of each Series.
<TABLE>
Series From Inception Through 6/30/98 Most Recently Completed Portfolio
Inception Return Period Return
<S> <C> <C> <C> <C> <C>
5/17/91 Series B 16.24% 5/27/97-6/30/98 Series B 11.29%
1/3/92 Series A 16.33 1/27/97-2/27/98 Series A 18.90
9/1/92 Series C 20.21 9/17/96-10/24/97 Series C 28.52
7/22/96 Series 3 24.27 7/22/96-8/29/97 Series 3 33.68
11/1/96 Series 5 19.25 11/1/96-12/12/97 Series 5 25.85
1/2/97 Series J 14.26 1/2/97-1/30/98 Series J 12.87
2/25/97 Series 1 10.26 2/25/97-3/27/98 Series 1 19.38
4/28/97 Series 2 16.77 4/28/97-6/5/98 Series 2 24.49
</TABLE>
Past performance is no guarantee of future results. Average annual total
returns represent price changes plus dividends reinvested, divided by the
initial public offering price, and reflect maximum sales charges and expenses.
Returns for Series From Inception differ from Most Recently Completed
Portfolio because the former figures reflect a reduced sales charge on
rollovers and different performance periods.
The Dow Jones Industrial Average
The Dow Jones Industrial Average consists of 30 common stocks chosen by the
editors of The Wall Street Journal as representative of the New York Stock
Exchange and of American industry. These companies are highly capitalized and
their stocks are widely held by both individual and institutional investors.
The current companies are:
Allied Signal
Aluminum Co. of America
American Express
AT&T
Boeing
Caterpillar
Chevron
Coca-Cola
Du Pont
Eastman Kodak
Exxon
General Electric
General Motors
Goodyear
Hewlett-Packard
IBM
International Paper
Johnson & Johnson
J.P. Morgan & Co.
McDonald's
Merck
Minnesota Mining & Manufacturing (3M)
Philip Morris
Procter & Gamble
Sears Roebuck & Co.
Travelers Group
Union Carbide
United Technologies
Wal-Mart Stores
Walt Disney
Hypothetical Past Performance of the Strategy (not any Portfolio)
Growth of $10,000 Invested 1/1/73 Through 6/30/98
[A mountain chart compares the cumulative annual performance from 1/1/73
through 6/30/98 of the Strategy(3) (ochre), the Dow Jones Industrial
Average (DJIA) and the S&P 500 Index(*) (purple). An ochre box in the
upper left quadrant indicates the components of the Strategy performance
section of the chart ("net of sales charges and expenses"). The horizontal
(X) axis compares the cumulative annual performance by year, from 1/1/73
through 6/30/98. The vertical (Y) axis reflects the dollar amount value
for each index from 1/1/73 through 6/30/98. The initial value of each
investment is $10,000. Throughout the period from 1/1/73 through 6/30/98,
increases in each investment build towards the Y axis. At the end of this
period, the Y axis reflects the ending value of the Strategy ($458,377),
the ending value of the DJIA ($242,620) and the ending value of the S&P
500 Index ($241,866).
Since stocks in the Portfolio were chosen solely by applying the Strategy, we
analyzed the Strategy to see how it could have performed. Past performance of
the Strategy is no guarantee of future results of any Portfolio. The Strategy
would have underperformed the DJIA in 12 and the S&P 500 Index in 11 of the
last 25 years. There can be no assurance that any Portfolio will outperform
either index.
Annual Total Returns
<TABLE>
<CAPTION>
Strategy returns are net of sales charges and expenses.(3)
Year Strategy DJIA S&P 500 Year Strategy DJIA S&P 500
Index Index
<S> <C> <C> <C> <C> <C> <C> <C>
1973 -4.08% -13.12% -14.66% 1987 5.06 6.02 5.67
1974 -2.40 -23.14 -26.47 1988 22.44 15.95 16.58
1975 55.65 44.40 36.92 1989 25.65 31.71 31.11
1976 33.25 22.72 23.53 1990 -10.14 -0.57 -3.20
1977 -2.90 -12.71 -7.19 1991 31.81 23.93 30.51
1978 -1.91 2.69 6.39 1992 6.44 7.34 7.67
1979 10.48 10.52 18.02 1993 25.30 16.72 9.97
1980 24.69 21.41 31.50 1994 1.95 4.95 1.30
1981 5.51 -3.40 -4.83 1995 34.97 36.48 37.10
1982 23.78 25.79 20.26 1996 26.34 28.57 22.69
1983 36.93 25.68 22.27 1997 19.92 24.78 33.10
1984 5.41 1.06 5.95 6/30/98 6.18 14.11 17.66
1985 27.00 32.78 31.43
1986 32.96 26.91 18.37 Average 16.18% 13.32% 13.31%
</TABLE>
Average Annual Total Returns
For periods ending 12/31/97
3 year 5 year 10 year 15 year 20 year 25 year
Strategy(3) 26.61% 20.98% 17.52% 18.57% 16.89% 16.25%
DJIA 29.85% 21.81% 18.41% 18.21% 16.33% 13.01%
S&P 500 Index 30.82% 20.06% 17.89% 17.37% 16.41% 12.85%
Returns represent price changes plus dividends reinvested at each year end,
divided by the initial public offering price and do not reflect the deduction
of any commissions or taxes. Portfolio performance will differ from the
Strategy because of commissions, Portfolios are established and liquidated at
different times during the year, they normally purchase and sell stocks at
prices different from those used in determining Portfolio unit price, they are
not fully invested at all times and stocks may not be weighted equally.
(3) Net of Portfolio sales charges (2.75% for the first year, 1.75% for
each subsequent year) and estimated expenses.
Defining Your Risks
The following are important facts to keep in mind when considering this
investment. Please read them carefully. Your financial professional will be
happy to answer any questions you may have.
o The Portfolio is designed for investors who can assume the risks associated
with equity investments. It may not be appropriate for those seeking capital
preservation. U.S. equity markets have been at historically high levels
and no assurance can be given that these levels will continue.
o There can be no assurance that the Portfolio will meet its objective.
o The value of your investment will fluctuate with the prices of the
underlying stocks. There can be no assurance that dividend rates will be
maintained or that stocks prices will not decrease over the life of the
Portfolio.
o These stocks may have higher yields because they or their industries are
experiencing financial difficulties or are out of favor. There can be no
assurance that the market factors which caused these relatively low prices
and high yields will change.
Tax Reporting
The proceeds received when you sell this investment will reflect the deduction
of the deferred sales charge and, after the initial offering period, the
charge for organization costs. In addition, the annual statement and the
relevant tax reporting forms you receive at year end will be based on the
amount paid to you, net of the deferred sales charge and, after the initial
offering period, the charge for organization costs. Accordingly, you should
not increase the tax basis in your units by these charges.
Generally, dividends and any gains will be subject to tax each year. Capital
gains, if any, on assets held over a year will be taxed up to the maximum
federal tax rate of 20%. However, on rollovers of future Portfolios, if
available, investors will defer recognition of gains and losses on stocks that
are transferred to the new Portfolio.
Defining Your Costs
First-time investors pay an initial sales charge of about 1% when they buy.
In addition, all investors pay a deferred sales charge of $17.50 per 1,000
units, about 1.75%, deducted over the last ten months of the Portfolio.
As a % of Public Amount Per 1,000
Offering Price Units
Initial Sales Charge 1.00% $10.00
Deferred Sales Charge 1.75% $17.50
==== =====
Maximum Sales Charge 2.75% $27.50
Estimated Annual Expenses (as a % of net 0.127% $1.26
assets)
Estimated Organization Costs $0.65
If you sell your units before termination, the remaining balance of your
deferred sales charge will be deducted, along with the estimated costs of
selling Portfolio securities from your proceeds. If you roll over to a
successor Portfolio, if available, the initial charge will be waived. You
will only pay the deferred sales charge and operating expenses.
Volume Purchase Discounts
For larger purchases, the overall sales charges are reduced to put more of
your investment dollars to work for you.
Amount Purchased Total Sales Charge as a % of Public Offering
Price
Less than $50,000 2.75%
$50,000 to $99,999 2.50%
$100,000 to $249,999 2.00%
$250,000 to $999,999 1.75%
$1,000,000 or more 1.00%
Don't Delay!
Call your financial professional for a free prospectus containing more complete
information, including risks, charges and expenses. Please read the prospectus
carefully before you invest.
Additional Select Ten Portfolios containing the then-highest dividend-yielding
stocks may be offered in the future. Information contained herein is subject
to amendment. A registration statement relating to the securities of the next
Portfolio has been filed with the Securities and Exchange Commission. The
securities of that Portfolio may not be sold nor may offers to buy be accepted
prior to the time 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 by 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 state.
Defined Asset Funds
Buy With Knowledge Hold With Confidence
EQUITY INVESTOR FUNDS
Other Select Series
United Kingdom Portfolio
(Financial Times Index)
Select Growth Portfolio
Select S&P Industrial
Portfolio
Select S&P Intrinsic Value
Portfolio
Select S&P Industry
Turnaround Portfolio
Concept Series
Premier American Portfolio
Premier World Portfolio
Tele-Global Trust
Utility Portfolio
Index Series
S&P 500 Index Trust
S&P MidCap Index Trust
FIXED INCOME FUNDS
Corporate Funds
Government Funds
Municipal Funds
[Recycling logo] Printed on Recycled Paper
[Copyright logo] 1998 Merrill Lynch, Pierce, Fenner & Smith Incorporated.
Member SIPC. 11342BR-9/98
