Capital Strength Opportunity Portfolio, Series 13
Our goal with the Capital Strength Opportunity Portfolio is to choose well-capitalized companies with
strong market positions. One important advantage that well-capitalized companies enjoy over others is
that they have the potential to provide their stockholders with a greater degree of stability and
performance over time.
Through our selection process, we seek to find companies with the following
- Well-capitalized with strong balance sheets;
- Skilled management;
- High liquidity;
- Ability to generate earnings growth; and
- Record of financial strength and profit growth.
This unit investment trust seeks above-average capital appreciation; however, there is
no assurance the objective will be met.
Why Cash Matters
Companies with sizeable cash positions tend to be mature companies that dominate their industries. A
company with a significant amount of cash on its balance sheet is attractive for many reasons. Cash
enables companies to bypass the credit markets and provides the means to:
- Make strategic cash-financed mergers and acquisitions;
- Begin to pay dividends or increase dividend payments to boost returns;
- Repurchase undervalued shares;
- Reinvest cash to grow their business;
- Improve their debt rating, thus reducing their cost of capital; and
- Fund research and development projects, even in a down market.
|Not FDIC Insured Not Bank Guaranteed May Lose Value
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 information technology sector which involves additional risks,
including limited diversification. The companies engaged in the
information technology sector are subject to fierce competition, high
research and development costs, and their products and services
may be subject to rapid obsolescence. Technology company stocks,
especially those which are Internet-related, may experience extreme
price and volume fluctuations that are often unrelated to their
One of the securities held by the trust is issued by a foreign entity. 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.
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.
Local, regional or global events such as war, acts of terrorism, spread
of infectious diseases or other public health issues, recessions, or other
events could have a significant negative impact on the portfolio and
its investments. Such events may affect certain geographic regions,
countries, sectors and industries more significantly than others. The
recent outbreak of a respiratory disease designated as COVID-19 was
first detected in China in December 2019. The global economic impact
of the COVID-19 outbreak is impossible to predict but is expected to
disrupt manufacturing, supply chains and sales in affected areas,
negatively impact global economic growth prospects, and could result
in a substantial economic downturn or recession.
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.