DAILY DATA
Pricing as of 2/8/2012
| Offer Price1 |
$0.00
|
| Bid Price2 |
$518.41
|
| Liquidation Price3 |
$518.41
|
| Estimated Current Return (ECR) |
7.53 %
|
| Estimated Long Term Return (ELTR) |
5.76 %
|
| Accrued Interest |
$3.03000
|
| Principal Amount of Bonds* |
$494.55
|
| Average Maturity |
2.85 Years
|
| Estimated Annual Income |
$39.05
|
1 The "offer" price represents the net asset value of one unit of a trust plus a transactional sales charge, if applicable.
2 The "bid" price represents the net asset value of one unit of a trust excluding deferred sales charge, if applicable.
3 The "liquidation" price represents the net asset value of one unit of a trust and includes any front-end and deferred sales charges, if applicable, accounted for if investors liquidate units.
ECR is computed by dividing the estimated net annual interest income per unit by the public offering price. ELTR is calculated using a formula that (i) takes into consideration, and determines and factors in the relative weightings of, the market values, yields (taking into account the amortization of premiums and the accretion of discounts) and estimated retirements of all the bonds in the trust and (ii) takes into account the expenses and sales charge associated with each unit of the trust. Therefore, there is no assurance that the ECR and ELTR will be realized in the future.
Estimated Annual Income per Unit does take into account the impact of the sale of bonds to pay for the deferred sales charge. Estimated Annual Income per Unit is computed by dividing the estimated annual income of the underlying bonds by the number of units outstanding. The amount may be lower or greater than the above-stated amount due to certain factors that may include, but are not limited to, the selling of bonds to pay for the deferred sales charge, 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.
* Represents the principal amount of the underlying bonds and any cash held in the Trust and does not take into account the impact of the sale of bonds to pay the deferred sales charge or any expenses of the Trust. Bonds will be sold to pay the deferred sales charges, to meet redemptions, to pay expenses and in other limited circumstances. The sale of bonds will affect the principal amount of bonds included in the Trust and the principal amount of bonds per unit. Units of the Trust, when redeemed or upon termination, may be worth more or less than their original cost and there can be no assurance that a unitholder will receive the principal amount of bonds at any particular point in time.
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.
Investment Objective
The Claymore/Guggenheim High Yield Trust, Series 3 ("Trust") seeks to provide current income by investing in a portfolio primarily consisting of high yield corporate bonds.
PRINCIPAL INVESTMENT STRATEGY
The Trust will invest in a portfolio of high yield corporate bonds. The Sponsor will select bonds that it believes have the best chance to meet the Trust’s investment objective over its life.
The portfolio of the Trust consists of high yield corporate debt obligations which may include corporate bonds, mortgage- and asset-backed securities, loan participations and corporate instruments. As of the initial date of deposit (the “Inception Date”), at least 80% of the bonds in the portfolio are rated below investment-grade as determined by one or more nationally recognized statistical rating organizations. High yield or “junk” bonds are frequently issued by corporations in the growth stage of their development or by established companies which are highly leveraged or whose operations or industries are depressed. Obligations rated below investment-grade should be considered speculative as these ratings indicate a quality of less than investment-grade. Because high yield bonds are generally subordinated obligations and are perceived by investors to be riskier than higher rated securities, their prices tend to fluctuate more than higher rated securities and are affected by short-term credit developments to a greater degree than investment-grade bonds. See “Description of Bond Ratings” for details.
The Trust intends to pay interest distributions each month and expects to prorate the interest distributed on an annual basis; see “Distributions.” The record dates and distribution dates for principal and interest distributions are the 15th and 25th of each month, respectively. Furthermore, investors may receive principal distributions from bonds being called or sold prior to their maturity or as bonds mature.
The Sponsor has selected Guggenheim Partners Asset Management, LLC (“GPAM”), a wholly-owned subsidiary of Guggenheim Partners, LLC, to assist the Sponsor with the selection of the Trust’s portfolio.
SELECTION CRITERIA
The Sponsor considered the following factors, among others, in selecting the bonds:
- The bonds will be rated below investment-grade by one or more nationally recognized statistical rating organizations;
- The price of the bonds relative to other bonds with comparable characteristics;
- The diversification of bonds with respect to the issuer with no one issuer comprising more than 20% of the final portfolio;
- Attractiveness of the interest payments relative to bonds with similar characteristics; and
- The potential for early return of principal or any event risk which could have a negative impact on the price of the bonds.
Guggenheim Partners Asset Management, LLC (GPAM)
Guggenheim Partners Asset Management, LLC, is a subsidiary of Guggenheim Partners, LLC and an affiliate of the Sponsor, which offers financial services expertise within its asset management, investment advisory, capital markets, institutional finance and merchant banking business lines. Clients consist of an elite mix of individuals, family offices, endowments, foundations, insurance companies, pension plans and other institutions that together have entrusted the firm with supervision of more than $100 billion in assets. A global diversified financial services firm, Guggenheim Partners, LLC office locations include New York, Chicago, Los Angeles, Miami, Boston, Philadelphia, St. Louis, Houston, London, Dublin, Geneva, Hong Kong, Singapore, Mumbai and Dubai.
The Guggenheim Partners Asset Management high yield credit team consists of 55 investment professionals who review and follow approximately 1,000 high yield credits on a regular basis. GPAM’s high yield credit team performs rigorous credit research which includes stress-testing each credit under recession-like conditions to ensure sufficient asset value and downside support.
As a result of a merger, the Sponsor is also a subsidiary of Guggenheim Partners, LLC. See “General Information” for additional information.
RISKS AND OTHER CONSIDERATIONS
This Trust is not being offered for sale. This data is for informational purposes only.
As with all investments, you may lose some or all of your investment in the Trust. 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. 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:
- At least 80% of the bonds held by the Trust 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, below investment-grade bonds may be more sensitive to interest rate changes and more likely to receive early returns of principal.
- Certain corporate bonds may be rated 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 by more than one rating agency.
- Corporate bonds are fixed rate debt obligations that generally decline in value with increases in interest rates. Foreign and U.S. interest rates may rise or fall by differing amounts and, as a result, the Trust’s investment in foreign securities may expose the Trust to additional risks. Generally, bonds with longer periods before maturity are more sensitive to interest rate changes.
- Corporate bonds are subject to credit risk in that an issuer of a bond may be unable to make interest and principal payments when due. In general, lower rated bonds carry greater credit risk.
- There is no assurance that the Trust portfolio will retain for any length of time its present size and diversity. As indicated in the “Trust Portfolio,” over 50% of the bonds in the Trust may be called prior to their stated maturity date and will remain callable throughout the life of the Trust. A call provision is more likely to be exercised by the issuer when the offering price valuation of a bond is higher than its call price. Such price valuation is likely to be higher in periods of declining interest rates. In such cases, the proceeds from such redemptions will be distributed to unit holders. The Estimated Current Return and Estimated Long-Term Return of the units may be adversely affected by such sales or redemptions. As stated below, the size and diversity of the Trust may also be affected by the Trust’s sale of bonds to meet redemptions, for credit issues and in other circumstances.
- The Sponsor does not actively manage the portfolio. Because the portfolio is fixed and not managed, in general, the Sponsor only sells bonds at the Trust’s termination or in order to meet redemptions, for tax purposes, for credit issues or to pay sales charges and expenses. As a result, the price at which a bond is sold may not be the highest price the Trust could have received during the life of the Trust.
- No assurance can be given that the Trust’s investment objective will be achieved. This objective is subject to the continuing ability of the respective issuers of the bonds to meet their obligations.
- The Trust is subject to market risk. Market value fluctuates in response to various factors. These can include changes in interest rates, inflation, the financial condition of a bond’s issuer, perceptions of the issuer, ratings on a bond, or political or economic events affecting the issuer.
- Due to the current state of the economy, 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. Starting in December 2007, economic activity declined across all sectors of the economy, and the United States experienced increased unemployment. The economic crisis affected the global economy with European and Asian markets also suffering historic losses. Unemployment remains high in the United States. Extraordinary steps have been taken by the governments of several leading countries to combat the economic crisis; however, the impact of these measures is not yet fully known and cannot be predicted.
- An issuer or an insurer of the bonds may be unwilling or unable to make principal payments and/or interest payments in the future, may call a security before its stated maturity or may reduce the level of payment made. In addition, there is no guarantee that the issuers will be able to satisfy their interest or principal payment obligations to the Trust over the life of the Trust. This may result in a reduction in the value of your units.
- The financial condition of an issuer or an insurer of the bonds 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.
- The income generated by the Trust may be reduced over time in response to bond sales, changes in distributions paid by issuers, unit redemptions and expenses.
- The Trust will invest in foreign securities. The Trust’s investment in foreign securities presents additional risk. 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 includes securities of companies in the consumer products sector. 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.
- Certain bonds in the Trust may have been purchased by the Sponsor on a “when issued” basis. Bonds purchased on a “when issued” basis have not yet been issued by the issuer on the Inception Date (although such issuer has committed to issue such bonds). The effect of the Trust holding a “when issued” bond is that unitholders who purchase the their units prior to the delivery date of such bond may have to make a downward adjustment in the tax basis of their units. Such downward adjustment may be necessary to account for interest accruing on such “when issued” bond during the time between their purchase of units and delivery of such bonds to the Trust.
- The Trust may sell bonds to meet redemptions, pay expenses, for credit issues and in other circumstances. Accordingly, the size, diversity, composition, returns and income generated by the Trust may be adversely affected. In addition, such sales of bonds may be at a loss. If such sales are substantial enough, provisions of the Trust’s indenture could cause a complete and unexpected liquidation of the Trust before its scheduled maturity, resulting in unanticipated losses for investors.
- Certain of the bonds included in the Trust may be original issue discount bonds or “zero coupon” bonds, as noted in “Trust Portfolio.” These bonds may be subject to greater price fluctuations with changing interest rates and contain additional risks.
- Inflation may lead to a decrease in the value of assets or income from investments.
Please see the Trust prospectus for more complete risk information.
Unit Investment Trusts (“UITs”) are fixed and not actively managed. 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. Units, when redeemed, may be worth more or less than their original purchase price.
This UIT is part of a long-term strategy. Consult an attorney or tax advisor regarding tax consequences associated with an investment from one series to the next, if available. Investors should consult their tax advisor to determine tax consequences associated with the purchase or sale of units. Guggenheim Funds Distributors, Inc. does not offer tax advice.