Dividend Strength Opportunity Portfolio, Series 14
When it comes to investing for income and growth, investors have several choices. We believe companies
that have shown a solid history of distributing dividends to shareholders are a wise choice for prudent
investors to consider as part of their overall investment plan.
Due to the fact that corporations are not obligated to share their earnings with stockholders,
dividends may be viewed as a sign of a company’s profitability as well as management’s
assessment of the future, in our opinion. Additionally, dividends have historically been one of
the few constants in the world of investing, contributing nearly half of the stock market’s total
returns. According to Ibbotson Associates, dividends have provided approximately 41% of the
10.20% average annual total return on the S&P 500 Index, from 1926 through 2019. 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.
Portfolio Selection Process
Through our selection process we seek to find the stocks that we believe have
the best prospects for above-average total return.
Identify the Universe
begin with the companies listed in the S&P
1500 Index and eliminate those companies that
do not meet our investment criteria. These
criteria are designed to identify companies with
the following qualities:
- Well-capitalized with strong balance sheets.
- Record of financial strength and profit
- A history of dividend payments with the ability to generate dividend growth.
Examine Historical Financial Results
The next step in our process is to
look for those companies that have earned a net
cash flow return on investment that is above the
average of their peers. Historically, companies that
have increased their cash flows at a higher rate have
rewarded shareholders with superior total returns.
Select Companies with Attractive Valuations
The final step in our process is to select companies based on the
fundamental analysis of our team of research analysts. The stocks selected for the portfolio are those
that meet our investment objectives, trade at attractive valuations and, in our opinion, are likely to
exceed market expectations of future cash flows.
This unit investment trust seeks above-average total return through a combination of
capital appreciation and dividend income; 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 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.
You should be aware that the portfolio is concentrated in stocks in the industrials sector which involves
additional risks, including limited diversification. The companies engaged in the industrials sector are subject
to certain risks, including a deterioration in the general state of the economy, intense competition, domestic
and international politics, excess capacity and changing spending trends.
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
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
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.
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.