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Brookmont Equity Dividend Portfolio, Series 28

Brookmont Capital Management (“Brookmont”) is an employee-owned registered investment advisor whose investment strategy is based on a portfolio of individual equities that provide attractive current yields, potential dividend growth, and the opportunity for capital appreciation.

The Brookmont Equity Dividend Portfolio is a unit investment trust which invests in two types of equity securities:

  • Dividend-paying companies with a long history of increasing dividend payments year-over-year. These companies have the potential to act as a hedge against economic uncertainty. A company’s ability to reliably increase its dividend for years, or even decades, can be an indication of its financial strength or discipline.

  • Dividend-paying companies within industries resulting in names with high active share and growth prospects.

Brookmont believes that investing in dividend paying companies should be just as much forward looking as backward looking and that is why the firm emphasizes earnings resiliency, dividend capacity, strong management, and appropriate valuations that result in a high Brookmont Dividend Score.

The Importance of Dividends

Dividends have historically been one of the few constants in the world of investing, and they have had a significant impact on stock performance, contributing nearly half of the stock market’s total return. According to Ibbotson Associates, dividends have provided approximately 40% of the 10.30% average annual total return on the S&P 500 Index from 1926 through 2020. Of course, past performance is no guarantee of future 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.

Selection Process-
Bottom Up Research With Economic Tailwinds

  1. Determine Economic Trends – Typically, the investment team at Brookmont meets to determine economic trends.

  2. Sector Allocation – Sector allocations are determined based on input from investment team meetings.

  3. Industry Allocation – Portfolio is diversified across sector, style and size allocations. Weightings are adjusted to desired percentages, if additional exposure is needed, the Brookmont research team selects names from their watchlist.

  4. Determine Investable Universe – Rigorous fundamental research process begins with screening the investable universe for what Brookmont believes to be top quartile long-term return on invested capital (ROIC) drivers. ROIC is an accounting measure that gives investors direction on how efficiently companies are operating.

  5. Evaluate Company Fundamentals – Analysts review company financials, quarterly and annual reports, and earnings call transcripts to understand the direction of each company.

  6. Create Proprietary Model – Analysts then create a proprietary model for each company under review.

  7. Final Selection – The Brookmont Dividend Score is applied to each company under review and the final selection is made.


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Portfolio Objective

This unit investment trust seeks above-average total return through a combination of capital appreciation and dividend income; however, there is no assurance the objective will be met.


Not FDIC Insured • Not Bank Guaranteed • May Lose Value

You should carefully consider the portfolio investment objective, risks, and charges and expenses before investing. Contact your financial professional 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.

Risk Considerations
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.

One of the securities held by the trust is issued by a real estate investment trust (REIT). Companies involved in the real estate industry are subject to changes in the real estate market, vacancy rates and competition, volatile interest rates and economic recession.

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.

Large capitalization companies may grow at a slower rate than the overall market.

As the use of Internet technology has become more prevalent in the course of business, the trust has become more susceptible to potential operational risks through breaches in cybersecurity.

The COVID-19 global pandemic has resulted in major disruptions to economies and markets around the world. Financial markets have experienced extreme volatility and severe losses, negatively impacting global economic growth prospects. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty and may exacerbate other political, social and economic risks.

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.

Although this portfolio 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.

 
The information in the prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. The prospectus 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.
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The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
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