Target Growth Portfolio, 2nd Quarter 2017 Series
Target Growth 2Q '17 - Term 7/9/18 (Target Growth Portfolio) is a unit investment
trust which invests in a fixed portfolio of stocks for approximately 15 months.
The stocks are selected by applying a disciplined investment strategy which
adheres to pre-determined screens and factors. The portfolio seeks above-average
total return; however, there is no assurance the objective will be met.
The strategy is based on these steps:
- Begin with all stocks traded on a U.S. exchange and screen for the following:
- Minimum market capitalization of $6 billion.
- Minimum three month average daily trading volume of $5 million.
- Minimum stock price of $5.
- Eliminate REITs, ADRs, regulated investment companies
and limited partnerships.
- Select only those stocks with positive one year sales growth.
- Rank the remaining stocks on three equally-weighted factors:
- Sustainable growth rate.
- Change in return on assets over the last 12 months.
- Recent 6-month price appreciation.
- Purchase an approximately equally weighted portfolio
of the 30 stocks with the highest combined ranking on
the three factors, subject to a maximum of six stocks
from any one of the major GICS market sectors. The
financials and real estate sectors are combined for the
sector limit purpose.
If this strategy had been applied since 1995, investors would have realized
higher total returns than by investing in the S&P 500 Index. It is important
to note that the past performance of the strategy is hypothetical and it is
not indicative of the future performance of the Target Growth Portfolio. Although
this unit investment trust terminates in approximately 15 months, the strategy
is long-term. Investors should consider their ability to pursue investing in
successive portfolios, if available. There may be tax consequences unless units
are purchased in an IRA or other qualified plan.
Not FDIC Insured Not Bank Guaranteed May Lose Value
||Average Annual Total Returns*
|Annual Total Returns
Past performance is no guarantee of future results and the actual current
performance of the portfolio may be lower or higher than the hypothetical performance
of the strategy. Hypothetical returns for the strategy in certain years were
significantly higher than the returns of the S&P 500 Index. Hypothetical strategy
returns were the result of certain market factors and events which may not be
replicated in the future. You can obtain performance information which is current
through the most recent month-end by calling First Trust Portfolios L.P. at
1-800-621-1675 option 2. Investment return and principal value of the portfolio
will fluctuate causing units of the portfolio, when redeemed, to be worth more
or less than their original cost.
Simulated strategy returns are hypothetical, meaning that they do not represent actual trading, and, thus, may not reflect material economic and market factors, such as liquidity constraints, that may have had an impact on actual decision making. The hypothetical performance is the retroactive application of the strategy designed with the full benefit of hindsight. Strategy returns reflect a sales charge of 2.95% in the first year, 1.95% in subsequent years, estimated annual operating expenses of 0.187%, plus organization costs, but not taxes or commissions paid by the portfolio to purchase securities. Strategy returns assume that dividends are reinvested semi-annually while index returns assume dividends are reinvested monthly. Actual portfolio performance will vary from that of investing in the strategy stocks because it may not be invested equally in these stocks and may not be fully invested at all times. It is important to note that the strategy may underperform the S&P 500 Index in certain years and may produce negative results.
The S&P 500 Index is an unmanaged index of 500 stocks used to measure large-cap
U.S. stock market performance. The index cannot be purchased directly by investors.
Standard Deviation is a measure of price variability (risk). A higher degree of variability indicates more volatility and therefore greater risk.
You should consider the portfolio's investment objectives, risks, and
charges and expenses carefully before investing. Contact your financial advisor
or call First Trust Portfolios, L.P. at 1-800-621-1675 to request a prospectus,
which contains this and other information about the portfolio. Read it carefully
before you invest.
An investment in this unmanaged unit investment trust should be made with an
understanding of the risks involved with owning common stocks, such as an economic
recession and the possible deterioration of either the financial condition of
the issuers of the equity securities or the general condition of the stock market.
You should be aware that the portfolio is concentrated in stocks in the
consumer products sector making it subject to additional risks, including
limited diversification. The companies engaged in the consumer products
industry are subject to certain risks, including global competition, changing
government regulations and trade policies, currency fluctuations, and the
financial and political risks inherent in producing products for foreign markets.
An investment in a portfolio containing small-cap and mid-cap companies is
subject to additional risks, as the share prices of small-cap companies and certain
mid-cap companies are often more volatile than those of larger companies due
to several factors, including limited trading volumes, products, financial resources,
management inexperience and less publicly available information.
An investment in a portfolio containing equity securities of foreign issuers
is subject to additional risks, including currency fluctuations, political risks,
withholding, the lack of adequate financial information, and exchange control
restrictions impacting foreign issuers.
The value of the securities held by the trust may be subject to steep declines
or increased volatility due to changes in performance or perception of the issuers.