SERIES2
zacks income advantage strategy series 2
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DAILY DATA
as of
11/20/09
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Portfolio Status
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Secondary
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Offer Price1
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--
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Bid Price2
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$7.187400
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Liquidation Price3
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$7.187400
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1 The "offer" price represents the net asset value of one unit
of a trust plus a transactional sales charge.
2 The "bid" price represents the net asset value of one unit
of a trust excluding deferred sales charge.
3 The "liquidation" price represents the net asset value of
one unit of a trust and includes any front-end and deferred sales charges accounted
for if investors liquidate units.
4 The Historical Annual Dividend Distribution is as of date of deposit. The amount of distributions of the Trust may be lower or greater than the above-stated
amount due to certain factors that may include, but are not limited to, a change
in the dividends paid by issuers, a change in Trust expenses or the sale or maturity
of securities in the portfolio. Fees and expenses of the Trust may vary as a result
of a variety of factors including the Trust's size, redemption activity, brokerage and
other transaction costs and extraordinary expenses.
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DEPOSIT INFORMATION
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Inception Date
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8/7/2008
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Mandatory Termination Date
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11/25/2009
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NASDAQ Ticker Symbol
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CCZIBX
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Inception Unit Price
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$10.000000
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Inception Bid Price
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$9.900000
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Inception Liquidation Price
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$9.755000
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Historical Annual Dividend Distribution4
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--
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Deferred Sales Charge Dates
5
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Dec 2008
Jan 2009
Feb 2009
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| CUSIP - Monthly-Cash |
18386U620 |
| CUSIP - Monthly-Reinvest |
18386U638 |
| CUSIP - Monthly-Fee/Cash |
18386U646 |
| CUSIP - Monthly-Fee/Reinvest |
18386U653 |
5 Early redemption of units will still cause payment of deferred sales charge.
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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.
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INVESTMENT OBJECTIVE
The trust seeks to provide current income and the potential for capital appreciation.
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PRINCIPAL INVESTMENT STRATEGY
The Zacks Income Advantage Strategy utilizes a quantitative selection process developed by Zacks Investment Research, Inc. (“Zacks”) to determine the constituents of a final portfolio. The screening process is performed on all companies listed in Zacks’ primary database. The screening process to determine the actual investment portfolio of the trust was executed approximately one to two weeks before the deposit of the trust.
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SELECTION CRITERIA
The trust’s portfolio is divided into five different asset segments: master limited partnerships (“MLPs”), real estate investment trusts (“REITs”), companies created to hold investments in the operating companies or their cash flows (“Royalty Trusts”), common stocks of closed-end investment companies (“Closed-End Funds”) and high-yielding common stocks/american depositary receipts (“ADRs”). The methodology of each asset segment is as follows:
The security selection process begins by identifying an initial universe of NYSE, AMEX or Nasdaq-traded stocks in the Zacks database. From this initial universe, the trust portfolio is compiled using the following five quantitative strategies:
MLP Segment
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The MLP portion of the portfolio is reduced to approximately 15 stocks based on the following pre-set quantitative investment criteria:
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Eliminate those MLPs with a share price less than $10.00 and less than $3 million in liquidity, where liquidity is defined as price times average three-month trading volume.
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Rank the remaining stocks based on proportional short interest and eliminate the 10% with the largest amount of short interest.
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Rank the remaining stocks based on descending dividend yield and select the best 15 stocks for inclusion in the trust.
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Weight these 15 stocks based on dividend yield to make up approximately 17.5% of the trust’s assets.
REIT Segment The REIT portion of the portfolio is reduced to approximately 20 stocks based on the following pre-set quantitative investment criteria:
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Eliminate those REITs with a share price less than $10.00 and less than $5 million in liquidity, where liquidity is defined as price times average three-month trading volume.
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Rank the remaining stocks based on proportional short interest and eliminate the 10% with the largest amount of short interest.
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Rank the remaining stocks based on descending dividend yield and select the best 20 stocks for inclusion in the trust.
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Weight these 20 stocks based on dividend yield to make up approximately 20% of the trust’s assets.
Royalty Trust SegmentThe Royalty Trust portion of the portfolio is reduced to approximately 10 stocks based on the following pre-set quantitative investment criteria:
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Eliminate those Royalty Trusts with a share price less than $10.00 and less than $3 million in liquidity, where liquidity is defined as price times average three-month trading volume.
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Rank the remaining stocks based on descending dividend yield and select the best 10 stocks for inclusion in the trust.
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Weight these 10 stocks based on liquidity to make up approximately 22.5% of the trust’s assets.
Closed-End Fund SegmentThe Closed-End Fund portion of the portfolio is reduced to approximately 15 stocks based on the following pre-set quantitative investment criteria:
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Eliminate those Closed-End Funds that are not trading at a discount or have less than $150 million in assets under management.
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Eliminate those Closed-End Funds that have a dividend yield equal to zero.
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Eliminate those Closed-End Funds with less than $1 million in liquidity, where liquidity is defined as price times average three-month trading volume.
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Rank the remaining stocks based on descending dividend yield and select the best 15 Closed-End Funds for inclusion in the trust.
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Weight these 15 stocks based on dividend yield to make up approximately 10% of the trust’s assets.
Common Stock/ADR SegmentThe Common Stock/ADR portion of the portfolio is reduced to approximately 40 securities based on the following pre-set quantitative investment criteria:
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Rank the securities in this asset segment by descending market capitalization and eliminate those securities not among the largest 1,000.
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Eliminate those securities with a payout ratio of greater than 80%.
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From the remaining universe, eliminate those securities with a share price less than $10.00 and less than $2 million in liquidity, where liquidity is defined as price times average three-month trading volume.
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Rank the remaining securities based on descending dividend yield and select the best 40 securities for inclusion in the trust.
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Weight these 40 stocks based on dividend yield to make up approximately 30% of the trust’s assets.
Final Portfolio ConstructionThe five asset segments are combined to form the final portfolio. A final liquidity check is performed to ensure investability and portfolio capacity. Any stock that has a liquidity value – defined as price times average three-month daily trading volume – less than the estimated investment may be removed from the trust. The removed security will be replaced with the next highest ranked security from the same asset segment.
In the event that a stock is selected which may not be treated as a corporation for U.S. tax purposes, that stock will be removed and the next stock in the list will be selected for inclusion in the portfolio.
Zacks Investment Research, Inc.Zacks Investment Research, Inc. is a Chicago-based firm with over 25 years of experience in providing institutional and individual investors with the analytical tools and financial information necessary to the success of their investment process. The trust will pay Zacks an annual licensing fee for the use of its intellectual property.
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RISKS AND OTHER CONSIDERATIONS
This Trust is not being offered for sale. This data is for informational purposes only.
As with all investments, you can lose money by investing in this trust. 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.
- The sponsor does not actively manage the portfolio. The trust will generally hold, and may continue to buy, the same securities even though a security’s outlook, market value or yield may have changed.
- The trust invests in stocks issued by small-capitalization and mid-capitalization companies. These stocks customarily involve more investment risk than stocks of larger 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.
- Share prices or dividend rates on the securities in the trust may decline during the life of the trust. There is no guarantee 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 invests in ADRs and foreign securities. The trust’s investment in ADRs and foreign securities presents additional risk. ADRs are issued by a bank or trust company to evidence ownership of underlying securities issued by foreign corporations. Securities of foreign issuers present risks beyond those of domestic securities. More specifically, foreign risk is the risk that foreign stocks will be more volatile than U.S. stocks 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 may invest in companies that are considered to be passive foreign investment companies (“PFICs”). In general, PFICs are certain non-U.S. corporations that receive at least 75% of their annual gross income from passive sources (such as interest, dividends, certain rents and royalties or capital gains) or that hold at least 50% of their assets in investments producing such passive income. As a result of an investment in PFICs, the trust could be subject to U.S. federal income tax and additional interest charges on gains and certain distributions with respect to those equity interests, even if all the income or gain is distributed to its unitholders in a timely manner. The trust will not be able to pass through to its unitholders any credit or deduction for such taxes.
- Inflation may lead to a decrease in the value of assets or income from investments.
- The trust includes securities of Closed-End Funds. Closed-End Funds are actively managed investment companies that invest in various types of securities. Closed-End Funds issue shares of common stock that are traded on a securities exchange. Closed-End Funds are subject to various risks, including management’s ability to meet the Closed-End Fund’s investment objective and to manage the Closed-End Fund’s portfolio during periods of market turmoil and as investors’ perceptions regarding Closed-End Funds or their underlying investments change. Closed-End Funds are not redeemable at the option of the shareholder and they may trade in the market at a discount to their net asset value.
- The value of the fixed-income securities in the Closed-End Funds will generally fall if interest rates, in general, rise. Typically, fixed-income securities with longer periods before maturity are more sensitive to interest rate changes.
- A Closed-End Fund or an issuer of securities held by a Closed-End Fund may be unwilling or unable to make principal payments and/or to declare dividends in the future, may call a security before its stated maturity, or may reduce the level of dividends declared. This may result in a reduction in the value of your units.
- The financial condition of a Closed-End Fund or an issuer of securities held by a Closed-End Fund may worsen or its credit ratings may drop, resulting in a reduction in the value of your units. This may occur at any point in time, including during the primary offering period.
- Certain Closed-End Funds held by the trust may invest in bonds that are rated below investment-grade and are considered to be “junk” securities. Below investment-grade obligations are considered to be speculative and are subject to greater market and credit risks, and accordingly, the risk of non-payment or default is higher than with investment-grade securities. In addition, such securities may be more sensitive to interest rate changes and more likely to receive early returns of principal.
- Certain Closed-End Funds held by the trust may invest in bonds that are rated as investment-grade by only one rating agency. As a result, such split-rated securities may have more speculative characteristics and are subject to a greater risk of default than securities rated as investment-grade by both Moody’s and Standard & Poor’s.
- The trust invests in REITs. REITs may concentrate their investments in specific geographic areas or in specific property types, such as, hotels, shopping malls, residential complexes and office buildings. The value of the REITs and other real estate securities and the ability of such securities to distribute income may be adversely affected by several factors, including: rising interest rates; changes in the global and local economic climate and real estate conditions; perceptions of prospective tenants of the safety, convenience and attractiveness of the properties; the ability of the owner to provide adequate management, maintenance and insurance; increased competition from new properties; the impact of present or future environmental legislation and compliance with environmental laws; changes in real estate taxes and other operating expenses; adverse changes in governmental rules and fiscal policies; adverse changes in zoning laws; declines in the value of real estate; the downturn in the subprime mortgage lending market in the United States; and other factors beyond the control of the issuer of the security.
- The trust will invest in the units of Royalty Trusts. The trust’s investment in Royalty Trust units involves risks which may differ from an investment in common stock of a corporation. Royalty Trust units represent an equal fractional beneficial interest in such trust and often include provisions in their organization documents that limit their liability to unitholders. As a result, ownership of Royalty Trusts may not provide unitholders with the statutory rights normally associated with ownership of shares of a corporation. In addition, Royalty Trusts generally do not guarantee minimum distributions or even a return of capital and are subject to the risk that tax changes or recharacterizations will substantially affect the tax consequences of owning such trusts. Royalty Trusts are often subject to the risks associated with other energy-related companies including the possibility of wide fluctuations of energy prices.
- 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 trust includes securities issued by companies in the energy sector. 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 war in Iraq 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.
- Please note that the Sponsor may be engaged as a service provider to certain closed-end funds held by the Trust and therefore certain fees paid by the Trust to such closed-end funds will be paid to the Sponsor for its services to such closed-end funds.
- In addition to expenses of the units of the trust, the Trust is subject to various expenses of the closed-end funds.
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.
UITs are fixed and not actively managed. Investors can lose some or all of their investment in this Trust. An investment in this fixed portfolio should be made with an understanding of the risks involved with owning various types of investments. Industry predictions may not materialize and securities selected for the Trust may not participate in overall industry growth, if any. There is no guarantee that this portfolio will achieve its investment objective. The economic condition of the issuers of the securities in this portfolio as well as the stock market, in general, may worsen and therefore reduce the value of the units of the portfolio.
This UIT is part of a long-term strategy, and investors should consider their ability to invest in successive portfolios at the applicable sales charge, if available. There are tax consequences associated with an investment from one series to the next. Investors should consult their tax advisor to determine tax consequences associated with an investment from one portfolio to the next. Units of certain portfolios may be well suited for purchase by Individual Retirement Accounts or other qualified retirement plans. Consult your attorney or tax advisor regarding tax consequences associated with the purchase of units. Claymore Securities, Inc. does not offer tax advice.
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Investors should carefully consider the investment objectives and policies, risk considerations, charges
and ongoing expenses of any investment product before investing. The prospectus contains this and other
relevant information. Please read the prospectus carefully before you invest. To obtain a prospectus,
please contact a securities representative or Claymore Securities, Inc., 2455 Corporate West Drive, Lisle,
Illinois 60532, 800-345-7999, or download one by accessing the Literature section
of this website.
NOT FDIC-INSURED | NOT BANK-GUARANTEED | MAY LOSE VALUE
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