Value Line® Target 25 Portfolio, 3rd Quarter 2020 Series
Value Line® Target 25 3Q '20 - Term 10/8/21 (Value Line®
Target 25 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 factors.
The strategy is based on these steps:
- We begin with the 100 stocks that Value Line® currently
gives a #1 ranking for TimelinessTM (stocks of financial
companies, limited partnerships and companies whose
shares are not listed on a U.S. exchange are not eligible for
inclusion in the Value Line® Target 25 Strategy). Value
Line® ranks approximately 1,700 stocks, only 100 of which
are given their #1 ranking for TimelinessTM. They base their
rankings on a long-term trend of earnings, prices, recent
earnings, price momentum, and earnings surprises.
- We then rank the Value Line® #1 stocks for TimelinessTM
based on their 12-month and 6-month price appreciation, return on assets,
and price to cash flow.
- The 25 eligible stocks with the best overall ranking on
the four factors are selected by the sponsor for the
portfolio. The stocks are weighted by market
capitalization subject to a minimum weighting of
approximately 1% and a maximum weighting of
If this strategy had been applied since 1985, 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 Value Line®
Target 25 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.
This unit investment trust seeks above-average total return;
however, there is no assurance the objective will be met.
|Not FDIC Insured Not Bank Guaranteed May Lose Value
| Standard Deviations*
|| 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 1.85% in the first year
and estimated annual operating expenses of 0.172%, plus organization
costs, but not taxes or commissions paid by the portfolio to purchase
securities. Returns assume that all dividends received during a year are
reinvested monthly. Actual portfolio performance will vary from that of
investing in the strategy stocks because it may not be weighted the same
as the strategy 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 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.
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. In addition, the portfolio is heavily weighted in only a few stocks, making it
more volatile than an equally weighted portfolio.
You should be aware that the portfolio is concentrated in stocks in both the health care and information
technology sectors which involves additional risks, including limited diversification. The companies
engaged in the health care sector are subject to fierce competition, high research and development costs,
governmental regulations, loss of patent protection, and changing consumer spending trends. In addition,
health crises, such as a pandemic outbreak, can severely impact the health care industry in particular. 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 operating performance.
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.
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 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.
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.
“Value Line”, “The Value Line Investment Survey”, and “Timeliness,” are trademarks or registered trademarks of Value Line, Inc. (“Value Line”)
and have been licensed for use for certain purposes by First Trust Portfolios L.P. This product is not sponsored, endorsed, recommended, sold or
promoted by Value Line and Value Line makes no representation regarding the advisability of investing in products utilizing such strategy. First
Trust Portfolios L.P. is not affiliated with any Value Line company.