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Alerian MLP Infrastructure & Income Portfolio Series 3


Investment Objective

The Alerian MLP Infrastructure & Income Portfolio, Series 3 ("Trust") seeks to provide total return through capital appreciation and dividend income.

Principal Investment Strategy

Selection Criteria

Risks and Other Considerations

Portfolio Information

Daily Data

Offer Price $9.8312
Wrap Fee Price $9.6993
Liquidation Price $9.6993
Remaining Deferred Sales Charge $0.1350

CUSIPs

Monthly-Cash 40173Y383
Monthly-Reinvest 40173Y391
Monthly-Fee/Cash 40173Y409
Monthly-Fee/Reinvest 40173Y417

 

Deposit Information

Inception Date 7/6/2018
Non-Reoffered Date 10/5/2018
Mandatory Maturity Date 10/8/2019
NASDAQ Ticker Symbol CAMICX
Trust Structure RIC
Inception Unit Price $10.0000
Inception Liquidation Price $9.8650
Deferred Sales Charge Dates Nov 2018
Dec 2018
Jan 2019
Term 15 Months
Number of Holdings 29
Historical Annual Dividend Distribution $0.4858

Portfolio Holdings Analysis

All data is subject to change daily. Data may differ from the prospectus due to different data sources or market changes. Please refer to prospectus for additional information about the trust including the portfolio section criteria. Source: FactSet Research Systems Inc. unless otherwise noted. The total percentages may not be equal to 100% due to rounding. N/A indicates that certain securities have not been identified and/or classified by the data provider. A unit is a combination of securities or types of securities traded together.

Fundamental Data

Weighted Average Price/Earnings (P/E) Ratio 15.63
Weighted Average Price/Book (P/B) Ratio 8.29
Weighted Average Market Cap (MM) $24,257.50

Market Cap & Style Breakdown

Value Growth N/A Total
Large-Cap 26.71% 1.17% -- 27.88%
Mid-Cap 31.40% 6.02% -- 37.43%
Small-Cap 2.69% 0.35% -- 3.03%
N/A -- -- 31.66% 31.66%
Total 60.80% 7.54% 31.66% 100.00%

Asset Class

US Common Stock 42.31%
MLP 31.66%
Non US Common Stock 26.03%
Total 100.00%

Market Cap Breakdown

Style Breakdown

Sector & Industry Breakdown

Energy 81.76%
 Oil Gas & Consumable Fuels 81.76%
Utilities 17.66%
 Electric Utilities 3.99%
 Gas Utilities 1.58%
 Multi-Utilities 12.09%
Industrials 0.57%
 Transportation Infrastructure 0.57%
Total 100.00%

Country Breakdown

United States 73.97%
Canada 26.03%
Total 100.00%

Regional Breakdown

North America 100.00%
Total 100.00%

Developed Status

Developed 100.00%
Total 100.00%

Past performance is no guarantee of future results. Investment returns and principal value will fluctuate with changes in market conditions. Investors' units, when redeemed, may be worth more or less than their original cost.


Principal Investment Strategy

The Trust invests at least 80% of the value of its assets in equity securities of North American master limited partnerships (“MLPs”) and energy infrastructure companies that earn the majority of their cash flows from midstream activities or business activities (as defined below) and that are included in the Alerian Energy Infrastructure Capital Strength Select Index (the “Index”). The Trust seeks to substantially replicate the Index as of the date of deposit. The Trust may invest in non-U.S. securities listed on Canadian exchanges. Additionally, the Trust may invest in companies of any capitalization. As a result of this strategy, the Trust is concentrated in the energy sector and in securities of companies headquartered or incorporated in Canada.

Selection Criteria

As of the date of deposit, the Trust generally invests in the securities comprising the Index in proportion to their weightings in the Index. The Index is composed of MLP securities and their affiliates with credit ratings of either BB or higher from S&P Global Ratings (“S&P”) or Ba2 or higher from Moody’s Investors Service, Inc. (“Moody’s”). These credit ratings are higher than the MLP industry median. In selecting the final portfolio, the Trust will only invest in publicly traded partnerships, limited liability companies and corporations. When assessing quality, the Trust evaluates companies by looking for the credit ratings stated above and non-distressed cash yields in excess of the broader equity market.

Alerian Energy Infrastructure Capital Strength Select Index

The Index selects securities based on the following criteria:

1. Initial Universe: Begin with all North American securities of (i) companies that earn the majority of their cash flow from the pipeline transportation, gathering, processing, liquefaction, rail terminaling, and storage of petroleum, natural gas, and/or natural gas liquids (“midstream activities”), as defined by the Energy MLP Classification Standard; and (ii) companies that own at least 50% of the general partner (“GP”) of one or more North American companies that earn the majority of their cash flow from midstream activities (“Affiliate Companies”).

2. Define Sub-Universe: Reduce the initial universe by applying the following screens:

• Business Activities: Exclude Affiliate Companies that do not earn the majority of their cash flows from either midstream activities, the retail distribution of electricity and/or natural gas, or the refining and marketing of petroleum, natural gas, and/or natural gas liquids.

• Credit Rating: Exclude companies that have a credit rating from either S&P or Moody’s lower than BB or Ba2, respectively. Exclude MLPs and corporations that do not have a credit rating from either S&P or Moody’s. Exclude Affiliate Companies that do not have a credit rating from either S&P or Moody’s or whose affiliated limited partner securities do not have a credit rating from either S&P or Moody’s.

• M&A: Exclude securities that have a pending merger or acquisition that will lead to delisting the security.

• Cash Dividend: Exclude the securities that do not have a cash dividend. Exclude companies that do not have a dividend yield above the S&P 500 weighted average.

3. Selection: The securities for the Index are selected from the sub-universe by applying the following criteria:

• Duplicates: If two or more affiliated securities in the sub-universe are available, remove the securities that are subordinated in the capital structure.

• Yield Standard Deviation: Calculate each remaining security’s indicative yield by taking the most recently announced board-approved monthly or quarterly dividend and multiplying it by 12 or 4, respectively, and dividing by its closing price. Calculate the average indicative yield of all remaining securities. Calculate the standard deviation of the indicative yields of all remaining securities. Remove any securities whose indicative yield is greater than the sum of the average indicative yield and two standard deviations.

• Weighting: Group and weight the remaining securities by their tax election and yield as follows:
  • Pass-through entities: For the companies with a pass-through tax election (i.e. a limited partnership or a limited liability company), use a weighting scheme that assigns a greater weight to companies whose indicative yield is closer to the average indicative yield for the group so that this group comprises 20% of the Index.
  • Corporations: For the companies with a corporate tax election, use a weighting scheme that assigns a greater weight to companies whose indicative yield is closer to the average indicative yield for the group so that this group comprises 80% of the Index.
4. Rebalance Date: The Index is rebalanced quarterly during the middle of March, June, September and December.

As of June 15, 2018, the Index had 30 constituents. Since the Index rebalances quarterly, the number of constituents in the Index may fluctuate during the life of the Trust. The Trust will only invest in the securities that comprise the Index as of the date of deposit. The Trust will not rebalance its portfolio or track the Index during its lifetime.

The Index provider for the Trust is Alerian, who is not affiliated with the Trust. Alerian will be responsible for ongoing Index maintenance.

Risks and Other Considerations

As with all investments, you may lose some or all of your investment in the Trust. No assurance can be given that the Trust’s investment objective will be achieved. The Trust also might not perform as well as you expect. This can happen for reasons such as these:

• Securities prices can be volatile. The value of your investment may fall over time. Market value fluctuates in response to various factors. These can include stock market movements, purchases or sales of securities by the Trust, government policies, litigation, and changes in interest rates, inflation, the financial condition of the securities’ issuer or even perceptions of the issuer. Units of the Trust are not deposits of any bank and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

• Share prices or dividend rates on the securities in the Trust may decline during the life of the Trust. There is no guarantee that share prices of the securities in the Trust will not decline and that the issuers of the securities will declare dividends in the future and, if declared, whether they will remain at current levels or increase over time.

• The Trust will not track the Index. The Trust generally invests in the securities of the Index in proportion to their weightings in the Index as of the date of deposit. The Trust will not rebalance during its life. As a result, the Trust's portfolio may deviate from the Index during the life of the Trust and may not match the returns of the Index.

• The Trust invests in MLPs. MLPs are limited partnerships or limited liability companies that are taxed as partnerships and whose interests (limited partnership units or limited liability company units) are traded on securities exchanges like shares of common stock. Currently, most MLPs operate in the energy, natural resources or real estate sectors. Investments in MLP interests are subject to the risks generally applicable to companies in the energy and natural resources sectors, including commodity pricing risk, supply and demand risk, depletion risk and exploration risk.

The benefit the Trust derives from its investment in MLPs is largely dependent on their being treated as partnerships for federal income tax purposes. As a partnership, an MLP has no income tax liability at the entity level. If, as a result of a change in an MLP’s business, an MLP were treated as a corporation for federal income tax purposes, such MLP would be obligated to pay federal income tax on its income at the applicable corporate tax rate. If an MLP was classified as a corporation for federal income tax purposes, the amount of cash available for distribution with respect to its units would be reduced and any such distributions received by the Trust would be taxed entirely as dividend income if paid out of the earnings of the MLP. Therefore, treatment of an MLP as a corporation for federal income tax purposes would result in a material reduction in the after-tax return to the Trust, likely causing a substantial reduction in the value of the units of the Trust.

• The Trust is concentrated in the energy sector. As a result, the factors that impact the energy sector will likely have a greater effect on this Trust than on a more broadly diversified Trust. Companies in the energy sector are subject to volatile fluctuations in price and supply of energy fuels, and can be impacted by international politics and conflicts, including the unrest and hostilities in the Middle East, terrorist attacks, the success of exploration projects, reduced demand as a result of increases in energy efficiency and energy conservation, natural disasters, clean-up and litigation costs associated with environmental damage and extensive regulation.

• The Trust invests in energy infrastructure companies. Energy Infrastructure companies, including utilities, energy and companies involved in infrastructure projects, may be subject to a variety of factors that may adversely affect their business or operations, including significant federal, state and local government regulation as to how facilities are constructed, maintained and operated, environmental controls, and the prices they charge for products and services. Stricter laws, regulations or enforcement policies could be enacted in the future, which would likely increase compliance costs and may adversely affect the financial performance of these companies. In addition, natural disasters also may have a significant impact on energy infrastructure companies.

• The Trust includes securities issued by companies in the oil, gas and fuels industry. Companies in the oil, gas and fuels industry may be adversely affected by changes in worldwide energy prices, exploration and production spending. Companies in this industry are also affected by changes in government regulation, world events and economic conditions. In addition, these companies are at risk for environmental damage claims. Companies in this industry could be adversely affected by commodity price volatility, changes in exchange rates, imposition of import controls, increased competition, depletion of resources, technological developments and labor relations.

• The Trust invests in foreign securities. The Trust’s investment in foreign securities listed on foreign exchanges presents additional risk. Securities of foreign issuers present risks beyond those of domestic securities. More specifically, foreign risk is the risk that foreign securities will be more volatile than U.S. securities due to such factors as adverse economic, currency, political, social or regulatory developments in a country, including government seizure of assets, excessive taxation, limitations on the use or transfer of assets, the lack of liquidity or regulatory controls with respect to certain industries or differing legal and/or accounting standards.

• The Trust is concentrated in securities issued by Canadian companies. Canada is a major producer of forest products, metals, agricultural products and energy-related products, such as oil, gas and hydroelectricity. The Canadian economy is dependent on the demand for, and supply and price of, natural resources, and the Canadian market is relatively concentrated in issuers involved in the production and distribution of natural resources. A small number of sectors, including the materials sector, represent a large portion of the Canadian market.

• The Trust includes securities whose value may be dependent on currency exchange rates. The U.S. dollar value of these securities may vary with fluctuations in foreign exchange rates. Most foreign currencies have fluctuated widely in value against the U.S. dollar for various economic and political reasons such as the activity level of large international commercial banks, various central banks, speculators, hedge funds and other buyers and sellers of foreign currencies.

• The Trust invests in securities issued by small-capitalization and mid-capitalization companies. These securities customarily involve more investment risk than securities of large-capitalization companies. Small-capitalization and mid-capitalization companies may have limited product lines, markets or financial resources and may be more vulnerable to adverse general market or economic developments.

• Inflation may lead to a decrease in the value of assets or income from investments.

• The Sponsor does not actively manage the portfolio. The Trust will generally hold, and may, when creating additional units, continue to buy, the same securities even though a security’s outlook, market value or yield may have changed.

See “Investment Risks” in Part A of the prospectus and “Risk Factors” in Part B of the prospectus for additional information.

Please see the Trust prospectus for more complete risk information.

Unit Investment Trusts are fixed, not actively managed and should be considered as part of a long-term strategy. Investors should consider their ability to invest in successive portfolios, if available, at the applicable sales charge. UITs are subject to annual fund operating expenses in addition to the sales charge. Investors should consult an attorney or tax advisor regarding tax consequences associated with an investment from one series to the next, if available, and with the purchase or sale of units. Guggenheim Funds Distributors, LLC does not offer tax advice.




Read a prospectus and summary prospectus (if available) carefully before investing. It contains the investment objective, risks charges, expenses and the other information, which should be considered carefully before investing. To obtain a prospectus and summary prospectus (if available) click here or call 800.820.0888.

Investing involves risk, including the possible loss of principal.

Guggenheim Investments represents the investment management business of Guggenheim Partners, LLC ("Guggenheim"), which includes Security Investors, LLC ("SI"), Guggenheim Funds Investments Advisors, LLC ("GFIA") and Guggenheim Partners Investment Management ("GPIM") the investment advisors to the referenced funds.

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