Defined Asset Funds(R)
Select Series
2000
J
Income & Growth
Quantitative Research
IRA Ideal!
The Select
S&P Industrial
Portfolio
Take Indexing to Another Level...
[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(R)
Select S&P Industrial
Portfolio can help.
Instead of simply replicating an index, the Select S&P Industrial Portfolio
singles out stocks from the S&P Industrial Index* for a combination of capital
appreciation potential and current dividend income.
This value-oriented Portfolio seeks total return through a contrarian strategy
of selecting 15 Index stocks, with high dividend yields.
The Strategy
The Select S&P Industrial Portfolio employs a disciplined "buy and hold"
strategy. Each year, we intend to reapply the screening process to select a new
Portfolio. At that time, you can roll your proceeds into 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.
Select S&P Industrial Portfolio - 2000 Series J+
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Ticker Current
Name of Issuer Symbol Dividend Yield++
1. UST, Inc. UST 6.94%
2. Raytheon Company (Class B) RTN/B 4.21
3. Genuine Parts Company GPC 4.19
4. ConAgra, Inc. CAG 3.63
5. The May Department Stores Company MAY 2.68
6. Newell Rubbermaid, Inc. NWL 2.68
7. Hershey Foods Corporation HSY 2.43
8. Emerson Electric Company EMR 2.38
9. Air Products and Chemicals, Inc. APD 2.34
10. Albertson's, Inc. ABS 2.23
11. Bestfoods BFO 2.20
12. Pitney Bowes, Inc. PBI 2.10
13. American Home Products Corporation AHP 2.08
14. Abbott Laboratories ABT 2.01
15. Textron, Inc. TXT 1.94
The Portfolio does not reflect the research opinions or any buy or sell
recommendations of any of the Sponsors or Standard & Poor's.*
+ Initial date of deposit -- January 19, 2000.
++ Current dividend yield for each stock was calculated by annualizing
the last monthly, quarterly or semi-annual ordinary dividend received
on that stock and dividing the result by its market value as of the
close of trading on January 18, 2000. There can be no assurance that
future dividends, if any, will be maintained at the indicated rates.
Past Performance of Prior Select S&P Industrial Portfolios
Past performance is no guarantee of future results.
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Series From Inception Through
12/31/99
(including annual rollovers) Most Recently Completed Portfolio
Inception Series Return Period Series Return
1/22/97 A 8.02% 2/9/98-3/19/99 A 5.92%
2/24/97 B 7.91 3/23/98-4/23/99 B 6.13
4/21/97 C 9.72 4/27/98-6/4/99 C 12.29
6/9/97 D 1.32 6/15/98-7/23/99 D 7.93
7/21/97 E 0.99 7/27/98-8/27/99 E 1.39
9/8/97 F 7.51 9/14/98-10/15/99 F -1.91
10/20/97 G 2.73 10/26/98-12/3/99 G 5.03
12/2/97 H -0.30 12/2/97-1/8/99 H 17.47
1/8/98 J -1.21 1/8/98-2/8/99 J 10.13
The chart above shows average annual total returns which represent price
changes plus dividends reinvested, divided by the initial public offering
price, and reflect deduction of maximum sales charges and expenses. Returns for
Series From Inception differ from Most Recently Completed Portfolio because the
former figures reflect different performance periods and reduced sales charge
on annual rollovers.
Avoid the teachings of speculators whose judgments are not confirmed by
experience.
LEONARDO DA VINCI
The Selection Process
The Select S&P Industrial Portfolio looks for potential values in the equity
market by investing in companies in the S&P Industrial Index that may be
currently out of favor. It does this through a disciplined four-part screening
process:
1. Defining the Universe: We begin with the S&P Industrial Index, a subset of
the S&P 500 Index* that includes only industrial stocks. We then remove any
stocks that are also in the Dow Jones Industrial Average* (DJIA).
2. Quality Screen: We only consider stocks that are ranked "A+" or "A" by
Standard & Poor's. Standard & Poor's determines these stock rankings using a
computerized system which focuses primarily on the growth and stability of
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per-share earnings and dividends. It then assigns a symbol to each stock, from
"A+" for the highest ranked stocks to "D" for stocks Standard & Poor's
considers to be the most speculative. These rankings differ from
credit-worthiness rankings of bonds, and are not intended to predict stock
price movements.
3. Market Capitalization: We then rank the stocks by market capitalization, and
eliminate the lowest 25%. This allows the Portfolio to avoid smaller,
less-liquid issues.
4. Dividend Yield: Finally, we rank the remaining stocks according to dividend
yield. From this group we select the 15 highest dividend-yielding stocks for the
Portfolio, whose prices may be undervalued.
* "Standard & Poor's," "S&P," "S&P 500 Index" 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 Past Performance of the Strategy (not any Portfolio)
Growth of $10,000 Invested Over 25 Years-- 1/1/75 Through 12/31/99
Strategy(ss)..........$566,204 S&P 500 Index.............$508,254
DJIA..................$477,202 S&P Industrial Index......$524,342
Growth of $10,000 Invested Over 27 Years-- 1/1/73 Through 12/31/99
[A mountain chart compares the hypothetical past performance of the Strategy
(ochre), the Dow Jones Industrial Average (DJIA) (pink), the S&P 500 Index
(purple), and the S&P Industrial Index (green) from 1/1/73 through 12/31/99. 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"(ss)). The
horizontal (X) axis compares the cumulative annual performance by year, from
1/1/73 through 12/31/99. The vertical (Y) axis reflects the dollar amount value
for each index from 1/1/73 through 12/31/99. 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 ($431,122), the ending value of the
DJIA ($318,656), the ending value of the S&P 500 Index ($318,932), and the
ending value of the S&P Industrial Index ($328,907).]
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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
(with Portfolio sales charges and expenses deducted) would have underperformed
the DJIA in 10, the S&P 500 Index in 11 and the S&P Industrial Index in 10 of
the last 27 years.
Annual Total Returns
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S&P
S&P 500 Industrial
Year Strategy(ss) DJIA Index Index
1973 -20.13% -13.12% -14.66% -14.61%
1974 -5.35 -23.14 -26.47 -26.54
1975 40.63 44.40 36.92 36.78
1976 30.89 22.72 23.53 22.59
1977 -6.53 -12.71 -7.19 -8.20
1978 6.06 2.69 6.39 7.50
1979 26.47 10.52 18.02 18.40
1980 18.23 21.41 31.50 32.98
1981 7.67 -3.40 -4.83 -6.69
1982 25.87 25.79 20.26 20.14
1983 24.72 25.68 22.27 22.79
1984 12.34 1.06 5.95 4.09
1985 29.98 32.78 31.43 30.08
1986 28.78 26.91 18.37 18.54
1987 2.52 6.02 5.67 9.13
1988 42.04 15.95 16.58 15.80
1989 35.40 31.71 31.11 29.30
1990 0.96 -0.57 -3.20 -0.84
1991 27.06 23.93 30.51 30.39
1992 11.50 7.34 7.67 5.63
1993 2.28 16.72 9.97 8.90
1994 11.41 4.95 1.30 3.75
1995 36.68 36.48 37.10 34.26
1996 12.25 28.57 22.69 22.70
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1997 33.34 24.78 33.10 30.80
1998 15.10 18.00 28.34 33.43
1999 -13.10 27.01 20.89 25.66
Average 14.96% 13.68% 13.68% 13.81%
Average Annual Total Returns
For periods ending 3 5 10 15 20 25
12/31/99 year year year year year year
Strategy(ss) 9.80% 15.23% 12.69% 17.28% 17.34% 17.52%
DJIA 23.20% 26.83% 18.19% 19.52% 17.95% 16.72%
S&P 500 Index 27.34% 28.28% 18.07% 18.78% 17.64% 17.02%
S&P Industrial Index 29.92% 29.29% 18.75% 19.26% 17.86% 17.16%
Returns shown represent price changes plus dividends reinvested at year ends,
divided by the initial public offering price, and do not reflect 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.
(ss) Net of Portfolio sales charges (2.50% for the first year, 1.50% for each
subsequent year), creation and development fee and estimated expenses.
Defined Asset Funds(R)
Buy With Knowledge o Hold With Confidence
EQUITY INVESTOR FUNDS
Other Select Series
Select Ten Portfolio (DJIA)
United Kingdom Portfolio (Financial Times Index)
Institutional Holdings Portfolio
Multinational Portfolio
Select Growth Portfolio
Select Large-Cap Growth Portfolio
Standard & Poor's Industry Turnaround Portfolio
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Standard & Poor's Intrinsic Value Portfolio
Concept Series
Baby Boom Economy Portfolios [SM]
Energy Portfolio
Financial Services Portfolio
Health Care Trust
Internet Portfolio
Premier American Portfolio
Premier World Portfolio
Real Estate Income Fund
Tele-Global Trust
Utility Portfolio
Index Series
S&P 500 Trust
S&P MidCap Trust
FIXED-INCOME FUNDS
Corporate Funds
Government Funds
Municipal Funds
Defined Asset Funds--
Our Philosophy
At Defined Asset Funds, we are ever mindful that behind every investment dollar
lies something infinitely more important -- your investment goal. This is why
we offer a full range of defined investments designed to meet a variety of
objectives.
We are committed to providing our investors with some of today's most
attractive equity and fixed-income investments, within the convenient structure
of a unit investment trust. For income, for growth or for total return, we
believe that time in the market can be an effective strategy for growing your
portfolio.
At Defined Asset Funds, we set the foundation for all of our portfolios in this
way, because we too have an important goal in mind -- yours.
Take a Step Beyond!
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You can get started today with the Select S&P Industrial Portfolio for about
$250. Call your financial professional for a free prospectus containing more
complete information, including sales charges, expenses and risks. Please read
it carefully before you invest or send money.
Defining Your Risks
Please keep in mind the following factors when considering this investment.
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, and may not be appropriate for investors seeking
capital preservation or current income.
o There can be no assurance that the Portfolio will meet its objective, that
dividend rates will be maintained, that stock or unit prices will not decrease
or that the Portfolio will outperform the Indices.
o The value of your investment will fluctuate with the prices of the underlying
stocks. Stock prices can be volatile.
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.
o Stocks are chosen for characteristics such as value and quality, which may be
at odds with those of the stocks driving the market at a given time.
Tax Reporting
When seeking capital appreciation, managing tax liability on capital gains can
be vital to your overall return. By holding this Fund for more than one year,
individuals may be eligible for favorable federal tax rates on net long-term
capital gains (currently no more than 20%).
Generally, dividends and any gains will be subject to tax each year, whether or
not reinvested. However, on rollovers to future Portfolios, if available,
investors will defer recognition of gains and losses on stocks that are
transferred to the new Portfolio. Please consult your tax advisor concerning
state and local taxation.
Defining Your Costs
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You will pay an initial sales charge of about 1% the first time you buy. In
addition, you pay a deferred sales charge of $15.00 per 1,000 units, about
1.50%, deducted over the last ten months of the Portfolio.
As a % of Public Amount Per
Offering Price 1,000 Units
Initial Sales Charge 1.00% $10.00
Deferred Sales Charge 1.50% $15.00
================ ===========
Maximum Sales Charge 2.50% $25.00
Creation and Development Fee
(as a % of net assets) 0.250% $2.48
Estimated Annual Expenses
(as a % of net assets) 0.215% $2.13
Estimated Organization Costs $1.39
If you sell your units before the termination date, the remaining balance of
your deferred sales charge will be deducted, along with the estimated costs of
selling Portfolio securities, from the proceeds you receive. If you roll over
to a successor Portfolio, if available, the initial sales charge on that
Portfolio will be waived. You will only pay the deferred sales charge.
Volume Purchase Discounts
For larger purchases, the overall sales charges are reduced to put more of your
investment dollars to work for you.
Total Sales Charge
Amount as a % of
Purchased Public Offering Price
Less than $50,000 2.50%
$50,000 to $99,999 2.25%
$100,000 to $249,999 1.75%
$250,000 to $999,999 1.50%
$1,000,000 or more 0.75%
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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 their offer or sale is not permitted.
11579BR-1/00
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(C)2000 Merrill Lynch, Pierce, Fenner & Smith Incorporated. Member SIPC.
Defined Asset Funds is a registered service mark of Merrill Lynch & Co., Inc.
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