The Advantages of Unit Investment Trusts

Unit Investment Trusts (UITs) offer the convenience and diversification of owning a portfolio of securities in a packaged investment with a stated investment objective. UITs are professionally selected fixed portfolios that allow investors to know what securities are held within the portfolio.

In contrast to actively-managed funds which continually buy and sell securities, thereby changing their investment mix, the securities held in a UIT generally remain fixed. As a result of this relatively fixed portfolio structure, UITs experience no manager driven style drift or adjustments to the portfolio in response to changes in the markets.

Transparency—Know What You Own

• UITs are fixed portfolios that allow investors to know what securities are held in the trust from the date of deposit until maturity.
• Enables investors to make informed decisions that consider their specific risk preferences.
• May help avoid concentrated positions and portfolio overlap.

Professional Selection & Supervision

• Portfolios are selected and continuously monitored by experienced professionals.
• The static nature of a UIT’s holdings ensures the portfolio generally remains invested in the manager’s preferred universe of securities.

Disciplined “Buy and Hold” Strategy

• Once a portfolio is selected, the underlying securities generally do not change.
• Helps eliminate emotional investing by helping investors focus on long-term horizons rather than short-term performance.

Fully Invested Portfolio¹

• UITs typically do not hold cash—virtually every dollar goes to work for the investor.

Income Potential

• Many UITs seek to provide the potential of monthly income either from dividends or fixed-income distributions, if any. Please note that income can never be guaranteed.

Daily Liquidity

• Units are typically redeemable on any business day at the liquidation price, which may be more or less than the original purchase price.
• Investors should be aware that UITs are fixed, not actively managed and should be considered as part of a long-term strategy.

Scheduled Maturity

• Defined maturity may help investors align their investments with their time horizon. Keep in mind that a trust may terminate early as described in the prospectus.
• Reinforces investor discipline.
• If units are redeemed prior to the deferred sales charge period, the entire deferred sales charge will be collected.

Options at Maturity

• Most investors choose to hold their units until maturity. At that time, investors have three options²:
  • Roll proceeds from maturing UIT into another UIT³ (can be a Guggenheim Investments UIT or another sponsor’s UIT)
  • Receive a cash distribution after Trust liquidates its holdings or
  • In certain cases, if certain limits are met at purchase or maturity (see prospectus for additional information), receive an in-kind distribution, which may defer a taxable event.⁴

Guggenheim Investments UIT Asset Classes

Over 50 solutions are contained in a variety of asset classes:

Additional UIT Resources