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HSBC plans head start annual income opportunity notes tied to stocks
By Angela McDaniels
Tacoma, Wash., Nov. 28 - HSBC USA Inc. plans to price head start annual income opportunity notes with auto cap due Dec. 29, 2016 linked to a basket of 10 common stocks, according to an FWP filing with the Securities and Exchange Commission.
The basket includes Altria Group, Inc., Amazon.com, Inc., Amgen Inc., Archer-Daniels-Midland Co., AT&T Inc., Barrick Gold Corp., General Mills, Inc., Halliburton Co., Intel Corp. and Mattel, Inc.
Interest is payable annually and will equal the average of the performances of the basket stocks, subject to a minimum interest rate of 0%.
A stock's performance will be equal to the auto cap rate if its return is greater than or equal to negative 10%. The auto cap rate is expected to be 7% to 9% and will be set at pricing. If a stock's return is less than negative 10%, its performance will be the greater of its return and negative 30%.
The payout at maturity will be par.
The notes (Cusip: 4042K1TU7) will price Dec. 23 and settle Dec. 29.
HSBC Securities (USA) Inc. is the agent.
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