Energy Select Portfolio, Series 76
Energy is the vital force powering business, manufacturing, and the transportation of goods and services to serve the world’s economies. Energy supply and demand plays an increasingly vital role in
worldwide economic output. The challenge of developing clean fuel initiatives to make the most of traditional fossil fuels and investing in cutting edge research to identify new energy sources, like
hydrogen fuels and fusion technologies, becomes increasingly important.
Due to the COVID-19 pandemic, the International Energy Agency has projected that global oil
demand will fall by a record 9.3 million barrels per day year-on-year in 2020. Policy makers have
stepped in quickly and have responded with radical steps to tackle the oil market crisis. These
steps include cutting output to stabilize the oil market to reduce the amount of supply. They
anticipate that the potential recovery may begin to take hold in June 2020.
In April 2020, the energy sector was the top performing S&P 500 Index sector and was up 29.78%.
However, the energy sector is still down 60.70% from it’s all time high and down 35.70% yearto-
date as of April 30, 2020, which could represent an opportunity for long-term investing.1 The
S&P 500 Index is an unmanaged index of 500 stocks widely used to measure large-cap U.S. stock
Consider The Following
- According to the Oil Price Information Service, preliminary data from gasoline retailers has
indicated that drivers have started to increase their purchases at the pump. Buying is still
down approximately 37.7% less than normal, but it has improved from 50.0% less.
- Oil prices are increasing as producers cut output and many believe that the American
consumer will help drive the industry out of its demand crisis as the U.S. economy starts to
reopen following the COVID-19 pandemic.2
- The shale industry’s rapid growth over the last decade put the American oil industry ahead of
the rest of the world, surpassing Saudi Arabia and Russia.3
This unit investment trust seeks above-average capital appreciation; however, there is no
assurance the objective will be met.
|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 the number listed below 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 an investment that is concentrated in stocks in the energy sector involves additional risks, including limited diversification. The companies engaged in the energy sector are subject to certain risks,
including price and supply fluctuations caused by international politics, energy conservation, taxes, price controls, and other regulatory policies of various governments. Falling oil and gas prices may negatively impact the
profitability and business prospects of certain energy companies. There is no assurance that the projections stated herein will be realized.
An investment in foreign equities should be made with an understanding of the additional risks involved with foreign issuers, such as currency fluctuations, political risk, withholding, the lack of adequate financial information,
and exchange control restrictions impacting foreign issuers. Risks associated with investing in foreign securities may be more pronounced in emerging markets where the securities markets are substantially smaller, less
developed, less liquid, less regulated, and more volatile than the U.S. and developed foreign markets.
Large capitalization companies may grow at a slower rate than the overall market.
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.
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 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.
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 and negatively impact global economic growth prospects. The COVID-19 outbreak has also caused significant volatility and declines in global financial markets, which
have caused losses for investors. The impact of the COVID-19 outbreak may be short term or may last for an extended period of time, and in either case could result in a substantial economic downturn or recession.
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 qualified plan.