Cybersecurity Portfolio, Series 18
"Cybersecurity" is security that is applied to computing devices such as computers and smartphones, as
well as to networks and the Internet. Cybersecurity is used to protect computers, information and
services from unauthorized users. The Cybersecurity Portfolio contains a diversified portfolio of
companies that have been identified for their growing involvement in the cybersecurity industry.
With the heightened need for cybersecurity solutions, we believe this could be a favorable time to
invest in companies involved in such areas as anti-virus solutions, data back-up and recovery,
cloud-based systems, data encryption, data loss, enterprise security and homeland security.
Consider These Factors
- The global cybersecurity market is anticipated to grow from its current market value of more than $120
billion to over $300 billion by 2024, according to a research report by Global Market Insights.1
- Approximately 6 billion people are anticipated to be online – and need cyber protection – by 2022, up
from over 2 billion in 2015.2 By 2030 the human attack surface, defined as the totality of all exploitable
security holes within an organization that are created through the activities and vulnerabilities of
personnel, could possibly equal the world's population which is anticipated to reach 8.5 billion.3
- In 2018, the total number of data breaches reached 1,244 . The reported number of consumer records
containing sensitive personally identifiable information increased by approximately 126% over 2017,
according to a report released by the Identity Theft Resource Center and CyberScout.
- In fiscal year 2019, the White House proposed more than $8 billion to advance the cyber missions of the
Department of Defense.4
1 Security Sales & Integration
2 Cybersecurity Ventures
3 Business Wire
| 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 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 operating performance. There is no assurance
that the projections stated herein will be realized.
Cybersecurity companies are subject to the “Information
Technology” risks listed previously. In addition to their
cybersecurity business, certain of these companies may be
involved in other businesses unrelated to cybersecurity.
Negative performance by a company’s other business operations
may have a negative effect on a company’s stock performance,
even in situations in which they are deriving positive results
from their cybersecurity business.
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.
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
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.
This UIT is a buy and hold strategy and investors should consider
their ability to hold the trust until maturity. There may be tax
consequences unless units are purchased in an IRA or other
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.