DEFINED ASSET FUNDS[Registered]
Select Ten Portfolio
Series 002 [5/15/00 - Current Offering] | cusip: 29471Q606
Fund Overview
As of May 23, 2000
Closing NAV: 0.94424 Previous Close: 0.95663 Change: -0.01239
% Change: -1.30000%
[A 3-by-3 square grid indicates risk levels associated with large-, mid-, and
small-cap stocks in terms of growth, blend, and value. The levels are
color-coded, red indicating the highest risk, and blue the lowest. The square
for a large-cap value is shaded yellow, reflecting medium level of risk.]
The Objective:
The Portfolio seeks total return through a combination of capital appreciation
and current dividend income, by investing for about one year in approximately
equal values of the ten highest dividend-yielding stocks of the Dow Jones
Industrial Average (DJIA) at the time the Portfolio initially was offered.
The Strategy:
The Portfolio looks for potential values through a contrarian investing
approach -- buying stocks of established companies whose stock prices show the
highest yields, indicating that their prices may be depressed.
The Select Ten Portfolio employs a disciplined strategy. Each year, we intend
to reapply the screening process to select a new Portfolio. 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.
Offered By:
This portfolio is offered by Merrill Lynch (DOW002), PaineWebber (DOW002),
Morgan Stanley Dean Witter (MDOW002), Salomon Smith Barney (DOW002).
Portfolio Holdings
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Dividend information for the securities listed below is available in the
prospectus for this Fund. The offering, redemption and repurchase prices for
the Fund take into account expenses and sales charges.
Therefore, you will not be able to calculate these prices (or related
performance information) with the security prices and weightings listed below.
As of May 23, 2000
Security Symbol Price % of Portfolio
PHILIP MORRIS COS INC COM MO 27.44 11.31
EASTMAN KODAK CO COM EK 57.56 10.42
INTL PAPER CO COM IP 36.88 10.26
MORGAN J P & CO INC COM JPM 133.06 10.26
DU PONT E I DE NEMOURS COM DD 50.75 10.21
CATERPILLAR INC DEL COM CAT 39.50 10.06
MINNESOTA MNG & MFG CO COM MMM 84.13 9.87
SBC Communications SBC 41.81 9.53
AT&T CORP COM T 34.81 9.34
GENERAL MTRS CORP COM GM 74.94 8.79
Selection Methodology
We select the ten highest dividend-yielding stocks from the Dow Jones
Industrial Average (DJIA). The financial strength of these companies makes it
likely that they can rebound from current price under-valuation.
Performance
Performance From Inception Through March 31, 2000 (including annual
rollovers)
Series Inception Cumulative Total Average Annual Most Recently Completed
Date Return Total Return Portfolio
Offer to End Date Return
Series B 5/17/91 173.44% 11.99% 6/1/98 - 7/9/99 6.82%
Series A 1/3/92 136.86% 11.02% 2/4/99 - 3/10/00 -15.59%
Series C 9/1/92 168.06% 13.89% 9/28/98 - 10/29/99 11.44%
Series 3 7/22/96 46.37% 10.87% 8/3/98 - 9/10/99 11.05%
Series 5 11/1/96 32.57% 8.61% 11/16/98 - 12/17/99 2.36%
Series J 1/2/97 14.21% 4.18% 1/11/99 - 2/11/00 -18.07%
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Series 1 2/25/97 4.11% 1.31% 3/2/98 - 4/9/99 2.65%
Series 2 4/28/97 12.96% 4.25% 5/4/98 - 6/4/99 2.47%
Series 4 9/3/97 2.31% 0.89% 9/8/98 - 10/15/99 8.75%
Fees & Expenses
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 $15.00 per 1,000 units,
about 1.50%.
As a % of
Public Offering Amount Per
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 on date of deposit - 5/15/00) 0.250% $2.48
Estimated Annual Expenses
(as a % of net assets on date of deposit) 0.160% $1.58
Estimated Organization Costs $0.84
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 on that
Portfolio.
Volume Purchase Discounts
For larger purchases, the overall sales charges are reduced to put more of your
investment dollars to work for you.
Amount Total Sales Charge as a % of
Purchased Public Offering Price
Less than $50,000 2.50%
$50,000 to $99,999 2.25%
$100,000 to $249,000 1.75%
$250,000 to $999,999 1.50%
$1,000,000 or more .75%
Is this Fund appropriate for you?
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Yes, if you seek dividend income and capital appreciation. You may benefit from
a professionally selected and supervised portfolio whose risk is reduced by
investing in equity securities of different issuers in a variety of industries.
The Portfolio is not appropriate for you if you are not comfortable with the
Strategy or are unwilling to take the risk involved with an equity investment.
It may not be appropriate for you if you are seeking preservation of capital or
high current income.
Risk Considerations
Please keep in mind the following factors when considering this investment.
Your financial professional will be happy to answer any questions you may have.
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.
The value of your investment will fluctuate with the prices of the underlying
stocks. Stock prices can be volatile.
There can be no assurance that the Portfolio will meet its objective, that
dividend rates will be maintained, that stock prices will not decrease over the
life of the Portfolio or that the Portfolio will outperform the indices.
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.
Distributions and Taxes
Distribution Frequency (if any)
Four (4) per year
Reinvestment Options
By selecting the reinvestment option, you're choosing to have your distribution
payments used to purchase additional units of the fund (reinvestment). As such,
your principal will increase each distribution period, and because distribution
payments are based in part on the size of your invested principal, these
payments may increase proportionately. Taking part in the cycle of reinvestment
may compound the returns of your Defined Fund investment.
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Tax Reporting
When seeking capital appreciation, managing tax liability on capital gains can
be important 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 can 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.
Trustee
The Chase Manhattan Bank
Unit Investment Trust Department
4 New York Plaza - 6th Floor
New York, New York 10004
1-800-323-1508
Defined Asset Funds[Registered] are established as Unit Investment Trusts. By
definition, a trust account requires a trustee. The trustee holds the trust
securities, ensuring their safekeeping until the trust is terminated. The
trustee is also responsible for recordkeeping, for collecting any interest or
dividend income and principal payments, and for distributing this money to
investors.
L I N K S T O S P O N S O R W E B S I T E S
Merrill Lynch | Salomon Smith Barney | PaineWebber | Morgan Stanley
Dean Witter
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 medium, brochure or prospectus relating to the Portfolio.
Past performance is no indication of future results. Principal value, unit
prices and investment returns fluctuate with changes in market conditions. Your
investment may be worth more or less than your original cost when you redeem.
Return figures represent changes in unit price plus reinvestment of income and
principal distributions and reflect deduction of maximum applicable sales
charges and
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expenses. Average Annualized Return differs from Most Recently Completed
Portfolio because the figures reflect different performance periods and a
reduced sales charge on annual rollovers.
Contact your Financial Professional for a free prospectus (or download one from
this site) containing more complete information on any Defined Asset Fund,
including sales charges, expenses and risks. Please read it carefully before
you invest or send money.
Not all strategies are appropriate at all times. The opinions expressed in this
site do not constitute investment advice. Independent advice should be sought
in cases of doubt.
For more complete information about any of the funds, including their risks,
fees, sales charges and other expenses, please download a prospectus from this
site, or obtain one free of charge from your financial professional. The
prospectus should be read carefully before you invest or send money.
Not all funds are registered for sale in all states. Ask your financial
representative about the availability of specific funds in your state. In
addition, the funds described here are not available to investors outside the
US. Defined Asset Funds are sold by prospectus only. The prospectus is not an
offer to sell or a solicitation of an offer to buy units in the funds, nor
shall any such units be offered or sold to any person in any jurisdiction in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such jurisdiction.
As a unitholder, you may receive taxable dividends and capital gains. Taxes on
these distributions can affect the returns you realize from your investment.
The Sponsors do not offer tax advice except to suggest that you consider the
impact of taxes and that you may want to consult with your tax advisor before
making any investment.
Funds holding international securities can involve different risks than US
investments. The risks include political and economic instability, changing
currency exchange rates, foreign taxes and differences in financial accounting
standards.
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