By Marisa Wong
Madison, Wis., Oct. 6 - HSBC USA Inc. priced $1 million of knock-out buffer notes due Oct. 18, 2012 linked to the Russell 2000 index, according to a 424B2 filing with the Securities and Exchange Commission.
A knock-out event occurs if the index falls by more than 40% on any day during the life of the notes.
If a knock-out event occurs, the payout at maturity will be par plus the index return, subject to a maximum return of 18.75%. Investors will be exposed to any losses.
Otherwise, the payout will be par plus a contingent return of 18.75%.
HSBC Securities (USA) Inc. is the agent with J.P. Morgan Securities LLC as the placement agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Knock-out buffer notes
|
| Underlying index: | Russell 2000
|
| Amount: | $1 million
|
| Maturity date: | Oct. 18, 2012
|
| Coupon: | 0%
|
| Price: | Par
|
| Payout at maturity: | If index falls by more than 40% on any day during the life of the notes, par plus index return, capped at 18.75%, with exposure to losses; otherwise par plus 18.75%
|
| Initial level: | 648.64
|
| Knock-out buffer: | 40% of initial level
|
| Pricing date: | Oct. 4
|
| Settlement date: | Oct. 7
|
| Agents: | HSBC Securities (USA) Inc. and J.P. Morgan Securities LLC
|
| Fees: | 1%
|
| Cusip: | 4042K1QA4
|
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