Published on 1/12/2010 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $905,000 knock-out buffer notes on seven stocks via JPMorgan
By Susanna Moon
Chicago, Jan. 12 - HSBC USA Inc. priced $905,000 of 0% knock-out buffer notes due July 13, 2011 linked to a basket of stocks, according to an FWP filing with the Securities and Exchange Commission.
J.P. Morgan Securities Inc. is the agent.
The basket consists of Roper Industries, Inc. with a 5% weight, Itron, Inc. with a 20% weight, United Technologies Corp. with a 20% weight, Johnson Controls, Inc. with a 20% weight, Rockwell Automation, Inc. with a 20% weight, EnerNOC, Inc. with a 5% weight and Echelon Corp. with a 10% weight.
A knock-out event will occur if the final basket level falls from the initial basket level by more than the buffer amount of 6%.
If a knock-out event occurs, the payout at maturity will be par plus the basket return. Investors are exposed to any losses.
If a knock-out event does not occur, the payout will be par plus the basket return, with a floor of par plus 1%, the contingent minimum return.
| Issuer: | HSBC USA Inc.
|
| Issue: | Knock-out buffer notes
|
| Underlying stocks: | Roper Industries, Inc. (5% weight), Itron, Inc. (20% weight), United Technologies Corp. (20% weight), Johnson Controls, Inc. (20% weight), Rockwell Automation, Inc. (20% weight), EnerNOC, Inc. (5% weight) and Echelon Corp. (10% weight)
|
| Amount: | $905,000
|
| Maturity: | July 13, 2011
|
| Coupon: | 0%
|
| Price: | Par
|
| Payout at maturity: | If final basket level falls from initial basket level by more than 6%, par plus return; otherwise, par plus greater of return and 1%
|
| Initial prices: | $52.44 for Roper, $71.66 for Itron, $70.63 for United Technologies, $28.63 for Johnson Controls, $28.63 for Rockwell, $33.50 for EnerNOC and $11.81 for Echelon
|
| Pricing date: | Jan. 8
|
| Settlement date: | Jan. 13
|
| Agent: | J.P. Morgan Securities Inc.
|
| Fees: | 1%
|
| Cusip: | 4042K0L37
|
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