IRA Ideal!
Defined Asset Funds[SM]
The Select S&P Industrial Portfolio
1998 Series
Take indexing to another level...
[ML Logo] Merrill Lynch
Indexing- it's a strategy to mirror the returns of major indices. Why not take
a step beyond?
The Defined Asset Funds(SM)
Select S&P Industrial Portfolio can help.
The Portfolio
This Portfolio singles out stocks from the S&P Industrial Index,* using a
contrarian approach. The resulting 15 stock Portfolio seeks a combination of
value, capital appreciation potential and current dividend income.
Although each Portfolio is a one-year investment, we recommend you continue
this Strategy for at least three to five years for potentially more consistent
results.
The Selection Process
Stocks in the Portfolio are selected through a disciplined process:
1. Defining the Universe: We begin with the S&P Industrial Index and remove
any stocks that are a part of the Dow Jones Industrial Average* (DJIA).
2. Quality Screen: We include only stocks that are ranked A+ or A by Standard &
Poor's.
3. Market Capitalization: We then rank the stocks by their market
capitalization from highest to lowest, and eliminate the lowest 25%.
4. Highest Dividend Yield: Finally, we rank the remaining stocks according to
dividend yield. From that group, we select the 15 highest-yielding stocks for
the Portfolio.
Past Performance of Prior Select S&P Industrial Portfolios
Past performance is no guarantee of future results.
Series From Inception Through 9/30/98
(including annual rollovers)
<TABLE>
<S> <C> <C>
Inception Series Return
- --------- ------ ------
1/22/97 A 11.46%
2/24/97 B 12.56
4/21/97 C 20.91
6/9/97 D 7.64
7/21/97 E 4.66
9/8/97 F 7.74
</TABLE>
Most Recently Completed Portfolio
<TABLE>
<S> <C> <C>
Period Series Return
- --------- ------ ------
1/22/97-3/13/98 A 31.43%
2/24/97-4/24/98 B 22.96
4/21/97-5/22/98 C 35.59
6/9/97-7/17/98 D 19.39
7/21/97-8/21/98 E 8.25
</TABLE>
The chart above shows average annual total returns which represent price
changes plus dividends reinvested, divided by the initial public offering
price, and reflects 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 annual rollovers and
different performance periods.
* "Standard & Poor's," "S&P," "S&P 500" and the "S&P Industrial Index"
are trademarks of The McGraw-Hill Companies, Inc., and have been licensed for
use by Defined Asset Funds. The Portfolio is not sponsored, managed, sold or
promoted by Standard & Poor's. The name "Dow Jones Industrial Average" is the
property of Dow Jones & Company, Inc.
Hypothetical Results
We analyzed the hypothetical returns of $10,000 invested over 25 years based on
the Strategy (not any Portfolio) as compared to various benchmarks. The
Strategy would have underperformed the DJIA (with Portfolio sales charges and
expenses deducted) in 8, the S&P 500 Index* in 9 and the S&P Industrial Index
in 8 of the last 25 years and would have produced a loss in only three years.
Defining Your Risks
Before investing, please consider:
o There are risks associated with equity investments. The Portfolio
is not appropriate for investors seeking capital preservation.
Despite recent volatility, U.S. equity markets are still near
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, stock prices will not decrease, dividend rates will be
maintained, or that any Portfolio will outperform either index.
o The value of your investment will fluctuate with the prices of
underlying stocks. Their yields may be higher because they or
their industries are out of favor.
o Owning units of this Portfolio may result in annual federal, state
and local taxes, only some of which can be deferred by rolling
over into the next portfolio. Consult your tax adviser concerning
your personal situation.
Hypothetical Past Performance of the Strategy (not any Portfolio)
Growth of $10,000 Invested 1/1/73 Through 9/30/98
[A mountain chart compares the hypothetical past performance of the Strategy
(ochre) from 1/1/73 through 9/30/98, the Dow Jones Industrial Average (DJIA)
(pink), the S&P 500 Index (purple) and the S&P Industrial Index (green). 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 9/30/98. The vertical (Y) axis reflects the dollar amount
value for each index from 1/1/73 through 9/30/98. The initial value of each
investment is $10,000. Throughout the aforementioned period, increases in
each investment builds towards the Y axis. At the end of this period, the Y
axis reflects the ending value of the Strategy ($419,926), the ending value of
the DJIA ($213,831), the ending value of the S&P 500 Index ($218,020) and the
ending value of the S&P Industrial Index ($214,880).]
Past performance of the Strategy is no guarantee of future results of any
Portfolio. Results represent price changes plus dividends reinvested at year
end, and do not reflect deduction of any commissions or taxes. Only Strategy
performance reflects the deduction of Portfolio sales charges (2.75% for the
first year, 1.75% for each following year) and estimated expenses. 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, Portfolios are not fully invested at all
times and stocks may not be weighed equally.
Select Now!
You can get started with the Select S&P Industrial Portfolio with as little as
$250. Simply return the attached coupon to receive a free copy of our
brochure. Ask your financial professional for a free prospectus containing
more complete information on the Select S&P Industrial Portfolio, including
all charges, expenses and risks. Please read it carefully before you invest.
Yes! I would like more information on the Select S&P Industrial Portfolio from
Defined Asset Funds.
The information in this brochure is not complete and may be changed. We may
not sell the securities of the next Portfolio until the registration statement
filed with the Securities and Exchange Commission is effective. This brochure
is not an offer to sell these securities and is not soliciting an offer to buy
these securities in any state where the offer or sale is not permitted.
11584NI-10/98
(Copyright logo) 1998 Merrill Lynch, Pierce, Fenner & Smith Incorporated.
Member SIPC.
