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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.

Core Holdings

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 characteristics.

Companies that pass these two screens are then ranked based on characteristics that Wells Fargo Advisors believes are important for long-term investors. The rankings consider:

  • Growth
  • 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 sector.

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.

Portfolio Objective

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.

Risk Considerations

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 economic recession.

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.

Fund Cusip Information
30317V346 (Cash)
30317V353 (Reinvest)
30317V361 (Cash-Fee)
30317V379 (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, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
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