Core Holdings Growth Trust, 2021 Spring Series
The Wells Fargo Advisors formula for long-term growth investing begins with the process of choosing quality companies that have solid prospects for the future.
These are companies that possess important competitive advantages, complementing records of long-standing profitability. However, these stocks, which can be considered core holdings, are seldom cheap when measured by many financial standards. The market often makes investors "pay up" for quality, but by extending their time horizon, investors can be more comfortable with the stocks themselves (and their quality) and less concerned with their price – an important component of holding core investments, in the opinion of Wells Fargo Advisors.
Wells Fargo Advisors believes the stocks that should form the "core" of your
portfolio are those companies which are consistently profitable industry leaders.
The stocks that are placed on the Wells Fargo Advisors Core Stock Investment
Plan list must meet very strict criteria, including the following quantitative
and qualitative criteria:
- Solid returns on invested capital
- A prominent market share position
- Consistent sales and earnings growth
- A seasoned management team
- The ability to maintain these
characteristics in the future
A company must have a market value of at
least $2 billion and revenues of at least $1 billion
to be considered for the Core list. All
companies, excluding American Depositary
Receipts ("ADRs"), that trade on major markets
in the U.S. are screened for these two
Companies that pass these two screens are then ranked based on characteristics
that Wells Fargo Advisors believes are important for long-term investors. The
- Return on invested capital
- Stability of revenues and earnings
- Stock price volatility
- Financial strength
- Other characteristics deemed significant
overall or to a specific industry or
Additional considerations the analysts at Wells Fargo Advisors consider when selecting
stocks for the Core list include changes to the company's operating or regulatory
environment, and whether the analysts believe the stock is suitable for long-term
buy and hold investing.
Of course, there can be no guarantee that the companies selected for a portfolio will continue
to exhibit these characteristics or that any investment will grow, nor is past performance any
assurance of future performance.
While there are many different ways for growth-oriented investors to obtain capital appreciation through their investments, Wells Fargo Advisors believes that buying (and holding) companies that are well managed, with highly sought-after products and services, is an excellent way to achieve the potential for growth.
The objective of the Core Holdings Growth Trust, which packages a selection of stocks from the
Wells Fargo Core Stock Investment Plan, is to seek capital appreciation; however, there is no
assurance the objective will be met. The trust has a fixed portfolio and a fixed maturity.
An investment in the Core Holdings Growth Trust allows investors to own a professionally selected portfolio of stocks which meets the Wells Fargo Advisors' criteria for core stock holdings. In addition, the securities in this portfolio are companies that Wells Fargo Advisors believes you may want to own for a long time--in other words, stocks that will be a "core" portion of your portfolio.
|Not FDIC Insured Not Bank Guaranteed May Lose Value
You should consider the portfolio's investment objective, 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 approximate 2-year unmanaged unit investment
trust should be made with an understanding of the risks involved with owning common stocks.
The value of the securities held by the portfolio may be subject to declines or increased volatility
due to changes in performance or perception of the issuers. There are fees and sales charges associated
with this investment. 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.
The COVID-19 global pandemic has resulted in major disruptions to economies and markets around the world. Financial markets have experienced extreme volatility and severe losses, negatively impacting global economic
growth prospects. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty and may exacerbate other political, social and economic risks.
This portfolio contains a real estate investment trust, which is subject to additional risks, such as
changes in the real estate market, vacancy rates and competition, volatile interest rates and
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.
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.
While Wells Fargo Advisors has carefully evaluated and approved the securities
in this portfolio, it may choose for any reason not to recommend any or all
of the securities for another purpose or at a later date. This may affect the
value of your units.
Wells Fargo Advisors is the trade name used by two separate registered broker-dealers: Wells Fargo Advisors, LLC and Wells Fargo Advisors Financial Network, LLC, Members SIPC, non-bank affiliates of Wells Fargo & Company.
First Trust Portfolios L.P. is the sponsor of this portfolio.Units are available
through Wells Fargo Advisors and other broker/dealer firms.