The Dow® Target Dividend Portfolio, 4th Quarter 2023 Series
This unit investment trust which invests in a fixed
portfolio of stocks for approximately 15 months. The stocks are selected by
applying a disciplined investment strategy which adheres to pre-determined factors.
The strategy is based on these steps:
- Begin with the stocks that comprise the Dow Jones U.S. Select Dividend IndexSM.
The index consists of 100 widely-traded, dividend-paying stocks derived from
the Dow Jones U.S. Total Market IndexSM.
- Rank the stocks on two factors:
- Change in return on assets over the last 12 months. An increase in return on assets is generally used as an indication of improving business fundamentals and would receive a higher ranking than a stock with a negative change in return on assets.
- Price-to-book. A lower, but positive, price-to-book ratio is generally used as an indication of value.
- Purchase an equally weighted portfolio of the 20 stocks with the best overall
ranking on the two factors.
It is important
to note that the past performance of the strategy is hypothetical and it is
not indicative of the future performance of The Dow® Target Dividend Portfolio.
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.
This unit investment trust seeks above-average total return;
however, there is no assurance the objective will be met.
|Not FDIC Insured Not Bank Guaranteed May Lose Value
| Average Annual Total Returns*
|Annual Total Returns
Past performance is no guarantee of future results and the actual current
performance of the portfolio may be lower or higher than the hypothetical performance
of the strategy. Hypothetical returns for the strategy in certain years were
significantly higher than the returns of the indices. Hypothetical strategy
returns were the result of certain market factors and events which may not be
replicated in the future. You can obtain performance information which is current
through the most recent month-end by calling First Trust Portfolios L.P. at
1-800-621-1675 option 2. Investment return and principal value of the portfolio
will fluctuate causing units of the portfolio, when redeemed, to be worth more
or less than their original cost.
Simulated strategy returns are hypothetical, meaning that they do not represent actual trading, and, thus, may not reflect material economic and market factors, such as liquidity constraints, that may have had an impact on actual decision making. The hypothetical performance is the retroactive application of the strategy designed with the full benefit of hindsight. Strategy returns reflect a sales
charge of 1.85% and estimated annual operating expenses of 0.172%, plus organization costs, but not taxes or commissions paid by the portfolio to purchase securities. Returns assume that all dividends received during a year are reinvested monthly (except the Dow Jones U.S. Select Dividend IndexSM which assumes dividends are reinvested when they are received).
Actual portfolio performance will vary from that of investing in the strategy
stocks because it may not be invested equally in these stocks and may not be
fully invested at all times. It is important to note that the strategy may underperform
the indices in certain years and may produce negative results.
The S&P 500 Index is an unmanaged index of 500 stocks used to measure large-cap
U.S. stock market performance. The Dow Jones U.S. Select Dividend IndexSM
consists of 100 widely-traded, dividend-paying stocks derived from the Dow Jones
U.S. Total Market IndexSM. Neither index can be purchased directly
Standard Deviation is a measure of price variability (risk). A higher degree of variability indicates more volatility and therefore greater risk.
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 financials sector which involves
additional risks, including limited diversification. The companies engaged in the financials sector are subject
to the adverse effects of volatile interest rates, economic recession, decreases in the availability of capital,
increased competition from new entrants in the field, and potential increased regulation.
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.
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 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 ongoing effects of the COVID-19 global pandemic, or the potential impacts of any future public health crisis, may cause significant volatility and uncertainty in global financial markets. While vaccines have been developed, there is no guarantee that vaccines will be effective against future 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.
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 Dow Jones U.S. Select Dividend IndexSM is a product of S&P Dow Jones Indices LLC or its affiliates
("SPDJI") and has been licensed for use by First Trust Portfolios L.P. Standard & Poor's® and S&P® are
registered trademarks of Standard & Poor's Financial Services LLC ("S&P"); Dow Jones® is a registered
trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"); and these trademarks have been licensed
for use by SPDJI and sublicensed for certain purposes by First Trust Portfolios L.P. The Dow® Target Dividend
Portfolio is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates,
and none of such parties make any representation regarding the advisability of investing in such product
nor do they have any liability for any errors, omissions, or interruptions of the Dow Jones U.S. Select