Home   Logon   Mobile Site   Research and Commentary   About Us   Call 1.800.621.1675 or Email Us       Follow Us: 

Search by Ticker, Keyword or CUSIP       


American Recovery Portfolio, Series 11

The American Recovery Portfolio is a unit investment trust that invests in common stocks across the following sectors: energy, financials, health care, industrials and information technology. Our goal with this portfolio is to choose well-capitalized companies with strong market positions. One important advantage that well-capitalized companies enjoy over others is that they have the potential to provide their stockholders with a greater degree of stability and performance over time.

Through our selection process, we seek to find companies with the following qualities:

  • Well-capitalized with strong balance sheets;

  • Skilled management;

  • High liquidity;

  • Ability to generate earnings growth; and

  • Record of financial strength and profit growth.

Consider The Following

  • Energy | According to the U.S. Energy Information Administration, the global consumption of petroleum and liquid fuels in 2022 is projected to grow by 2.1 million barrels per day (b/d) from 2021. U.S. crude oil production is estimated to be 11.8 million b/d in 2022 and 12.6 million b/d in 2023 which would set a record for the most U.S. crude oil production in a year. The current record is 12.3 b/d set in 2019.

  • Financials | The financials sector covers a wide range of industries including banks, investment banking, brokerage, consumer finance and credit and insurance. From 1927 to 2021, the financials sector saw an average annual total real return of 6.7% vs. 4.9% for the S&P 500 Index during years when inflation was greater than the median consumer price index (CPI) of 2.6% at year-end. 1

  • Health Care | From 2021-2030, it is projected that health care spending will grow at an average rate of 5.1% annually.2 In the last decade, biopharmaceutical companies have invested more than $1 trillion in research and development. In addition, there are currently approximately 8,000 medicines in clinical development around the world. Of these, 74% have the potential to be first-in-class treatments, which represents an entirely new approach to treating a disease.3

  • Industrials | For third quarter 2022, industrials are expected to post year-over-year (YOY) earnings per share growth of 22.6% with an expected revenue growth of 14.5% YOY. Ten of the twelve industries that comprise the sector are expected to report a YOY increase in profit, including aerospace & defense, machinery, and building products.4

  • Information Technology | In 2022, Gartner forecasts worldwide software spending to grow 9.6% to $806.8 billion and global IT services spending to reach $1.3 trillion. In addition, global end-user spending on public cloud services is anticipated to reach $494.7 billion in 2022, up from $410.9 billion in 2021. End-user spending is projected to reach nearly $600 billion in 2023.

1 Ken French Data Library, Bloomberg. As of 12/31/21. Universe includes all NYSE, AMEX & Nasdaq stocks.
2 CMS.gov
4 Capital IQ, as of 9/21/22

The Russell 3000 Index is an unmanaged index used to measure the performance of the largest 3000 U.S. stocks based on total market capitalization. The index cannot be purchased directly by investors.

Portfolio Objective

This unit investment trust seeks above-average capital appreciation; however, there is no assurance the objective will be met.

Portfolio Selection Process

We begin with the Russell 3000 Index to create an initial universe of stocks with a market-cap above $10 billion that are in the sectors listed above. Next we examine the historical financial results of the stocks from the initial universe. The stocks are then evaluated using fundamental factors such as sales, earnings and cash flow growth; valuation factors such as price/earnings, price/cash flow, price/sales and price/book; and technical factors such as price momentum and earnings surprises.

An estimated value is calculated for each of the companies utilizing a Cash Flow Return on Investment (CFROI) method. A secondary valuation is also made employing a concept called Economic Margin. The companies which currently trade at an attractive market price relative to their estimated value are favored over companies that do not.

The final portfolio is then selected by a team of equity analysts who evaluate each stock by examining the stock’s relative valuation and other qualitative factors such as competitive advantages, new products and quality of management.

Our selection process attempts to find the stocks with the best prospects for above-average capital appreciation by identifying those that meet our investment objectives, trade at attractive valuations, and, in our opinion, are likely to exceed market expectations of future cash flows.

The final portfolio is comprised of 40 approximately equally weighted American Recovery stocks.

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.

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.

You should be aware that the portfolio is concentrated in stocks in the information technology sector which involves additional risks, including limited diversification. 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 mid-cap companies is subject to additional risks, as the share prices of 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.

In February 2022, Russia invaded Ukraine which has caused and could continue to cause significant market disruptions and volatility within the markets in Russia, Europe, and the United States. The hostilities and sanctions resulting from those hostilities could have a significant impact on certain investments as well as performance.

The COVID-19 global pandemic has caused and may continue to cause significant volatility and declines in global financial markets. While the U.S. has resumed “reasonably” normal business activity, many countries continue to impose lockdown measures. Additionally, there is no guarantee that vaccines will be effective against emerging variants of the disease.

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 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.


CUSIP identifiers have been provided by CUSIP Global Services, managed on behalf of the American Bankers Association by FactSet Research Systems Inc. and are not for use or dissemination in a manner that would serve as a substitute for any CUSIP service. The CUSIP Database, ©2022 CUSIP Global Services. "CUSIP" is a registered trademark of the American Bankers Association.

Fund Cusip Information
30328R284 (Cash)
30328R292 (Reinvest)
30328R300 (Cash-Fee)
30328R318 (Reinvest-Fee)
Printer Friendly Page Printer Friendly Page
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)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2022 All rights reserved.