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Japan Portfolio, Series 11

Over the past 70 years, government-industry cooperation, a strong work ethic, dominance in high technology, and a small defense allocation have helped Japan develop into an advanced economy. Japan has the world’s third-largest economy by nominal GDP1 and is the world’s fifth-largest exporter and importer.2 In addition, Japan has the world’s tenth-largest population, with over 126 million people.3 Japan is among the world’s largest and most technologically advanced producers of motor vehicles, electronic equipment, machine tools, steel and nonferrous metals, ships, chemicals, textiles and processed foods.4

Consider The Following

  • Data released in January 2018 showed that Japan’s flash Nikkei manufacturing Purchasing Managers’ Index (PMI) increased to a level of 54.4, the strongest level since February 2014, which may suggest that Japan’s economy is gaining momentum. A PMI reading above 50 represents an expansion of the manufacturing sector.
  • In January 2018, output in Japan expanded at its quickest rate in 47 months. In addition, new orders continue to rise sharply and recent yen weakness appears to benefit exporters.5
  • Japan’s economy is in its longest expansion since before the 2008 global financial crisis, due in part to the Bank of Japan’s monetary stimulus and economic reforms that Japanese Prime Minister Shinzo Abe put in place the past few years.6
  • The Japan economy has grown for seven consecutive quarters and unemployment is at 2.8%, lower than in any other major economy. As of 12/8/17, the Nikkei 225 had more than doubled in the previous five years, outperforming the S&P 500 Index, the equivalent U.S. benchmark. Even still, the Nikkei is about 40% below its 1989 high.7 The S&P 500 Index is an unmanaged index of 500 stocks used to measure large-cap U.S. stock market performance. The Nikkei 225 Index is comprised of Japan’s top 225 blue-chip companies traded on the Tokyo Stock Exchange. The indices cannot be purchased directly by investors. Past performance is no guarantee of future results.

Why Invest Internationally

Diversification is one of the principal advantages of global investing. Historically, by diversifying beyond the U.S., investors have been able to reduce the overall volatility of their portfolios over time. While individual foreign stock markets often move in tandem with the U.S. market over short-term periods, they generally have lower longer-term correlations with the U.S. and other foreign markets, which helps to temper some of the fluctuations found in a portfolio that consists primarily of U.S. stocks. Diversification does not guarantee a profit or protect against loss.

2,3,4 CIA - The World Factbook
5 Nikkei, IHS Markity
6 U.S. News & World Report
7 Kiplinger

Portfolio Objective

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 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.

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.

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.

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.

Because the portfolio is concentrated in companies headquartered in Japan, the portfolio may present more risks than a portfolio which is broadly diversified over several regions.

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.

Fund Cusip Information
30307C464 (Cash)
30307C472 (Reinvest)
30307C480 (Cash-Fee)
30307C498 (Reinvest-Fee)
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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 and the Internal Revenue Code. First Trust has no knowledge of and has not been provided any information regarding any investor. Financial advisors must determine whether particular investments are appropriate for their clients. First Trust believes the financial advisor is a fiduciary, is capable of evaluating investment risks independently and is responsible for exercising independent judgment with respect to its retirement plan clients.
First Trust Portfolios L.P.  Member SIPC and FINRA.
First Trust Advisors L.P.
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