The Dividend Growth Portfolio, Series 13 ("Trust") seeks to provide dividend income potential coupled with the potential for long-term capital appreciation.
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.
This information does not constitute an offer to sell or a solicitation of any offer to buy: nor shall there be any sale of these securities in any state where the offer, solicitation, or sale is not permitted.
Principal Investment Strategy
The Trust consists of a portfolio of dividend-paying equity securities that have historically increased their dividends. The Sponsor believes that dividends are often a good indicator of a corporation’s current financial condition and furthermore, may signal management’s belief in a profitable future for the corporation. The U.S.-traded common stocks held by the Trust may include the common stocks of U.S. and non-U.S. companies. The Trust may also invest in real estate investment Trusts. As a result of this strategy, the Trust invests significantly in the consumer products sector.
The Sponsor selects U.S.-traded companies that it believes should be core holdings of a dividend-paying portfolio. To select the portfolio the Sponsor follows a disciplined process which includes both quantitative screening and qualitative analysis.
The Sponsor begins with a universe of all dividend paying companies currently traded in the United States as of the date of the security selection. The Sponsor then reduces the universe to approximately 100 companies by performing quantitative screening, which may be primarily based on, but not limited to, the following factors:
• Dividend Growth. The Sponsor favors companies with a history of growing its annual dividend.
• Above Average Yields. The Sponsor favors companies with current yields above the market median yield.
• Avoiding Value Traps. In the higher yielding segment of the market, the Sponsor is cognizant of ‘value traps’ – those companies currently paying dividends while their fundamentals and competitiveness are declining. In an attempt to avoid those, the Sponsor may screen out the worst ranking companies within each sector based on recent profitability, sales growth, and valuation.
From this universe of approximately 100 companies, the Sponsor identifies companies for inclusion in the portfolio through a qualitative analysis based on factors such as, but not limited to:
• Cash-flow Adequacy. The Sponsor favors companies with recent earnings and operating cash-flow significantly higher than the dividends paid as of the company’s most recent financial reporting period.
• Balance Sheet. The Sponsor favors companies that possess overall financial strength and exhibit balance sheet improvements relative to their peers and the marketplace.
• Valuation. The Sponsor favors companies whose valuations appear to be attractive based on measures such as price-to-earnings, price-to-book and price-to-cash flow.
• Industry Leadership. The Sponsor favors companies that possess a strong competitive position among their domestic and global peers.
• Growth. The Sponsor favors companies with a history of (and prospects for) above average growth of dividends, sales and earnings.
• Profitability. The Sponsor favors companies with a history of consistent and high profitability as measured by return-on-assets, return-on equity, gross margin and net margin.
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:
• The Trust invests significantly in the consumer products sector. As a result, the factors that impact the consumer products sector will likely have a greater effect on this Trust than a more broadly diversified Trust. General risks of companies in the consumer products sector include cyclicality of revenues and earnings, economic recession, currency fluctuations, changing consumer tastes, extensive competition, product liability litigation and increased government regulation. A weak economy and its effect on consumer spending would adversely affect companies in the consumer products sector.
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 following affiliated investment management businesses of Guggenheim Partners, LLC: Guggenheim Partners Investment Management, LLC, Security Investors, LLC, Guggenheim Funds Distributors, LLC, Guggenheim Funds Investment Advisors, LLC, Guggenheim Partners Advisors, LLC, Guggenheim Corporate Funding, LLC, Guggenheim Partners Europe Limited, Guggenheim Partners Fund Management (Europe) Limited, Guggenheim Partners Japan Limited, GS GAMMA Advisors, LLC, and Guggenheim Partners India Management. Securities offered through Guggenheim Funds Distributors, LLC.
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