By Angela McDaniels
Tacoma, Wash., Oct. 30 – HSBC USA Inc. priced $15 million of 0% enhanced averaging buffered notes due April 30, 2019 linked to a basket of indexes and exchange-traded funds, according to a 424B2 filing with the Securities and Exchange Commission.
The basket consists of the S&P 500 index with a 45% weight, the S&P MidCap 400 index with a 20% weight, the iShares MSCI EAFE ETF with a 12.5% weight, the iShares Russell 2000 ETF with a 10% weight, the iShares U.S. Real Estate ETF with a 6.5% weight and the iShares MSCI Emerging Markets ETF with a 6% weight.
If the final basket value is greater than or equal to the buffer value, 85% of the initial value, the payout at maturity will be par plus 138% of the average reference return of the basket.
If the final basket value is less than the buffer value, the payout will be par plus (a) 138% of the average reference return minus (b) 1.1765% for every 1% that the final basket value declines beyond 15%.
The average reference return will be calculated using the average component values of the basket components. For each basket component, its average component value will be the average of its closing levels on July 25, 2018, Oct. 25, 2018, Jan. 25, 2019 and April 25, 2019.
HSBC Securities (USA) Inc. is the underwriter.
| Issuer: | HSBC USA Inc.
|
| Issue: | Enhanced averaging buffered notes
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| Underlying basket: | S&P 500 index (45% weight), S&P MidCap 400 index (20% weight), iShares MSCI EAFE ETF (12.5% weight), iShares Russell 2000 ETF (10% weight), iShares U.S. Real Estate ETF (6.5% weight) and iShares MSCI Emerging Markets ETF (6% weight)
|
| Amount: | $15 million
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| Maturity: | April 30, 2019
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| Coupon: | 0%
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| Price: | Par
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| Payout at maturity: | If final basket value is greater than or equal to buffer value, 85% of initial value, par plus 138% of average reference return of the basket; otherwise, par plus (a) 138% of average reference return minus (b) 1.1765% for every 1% that final basket value declines beyond 15%
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| Average reference return: | Calculated using average component values of basket components; for each basket component, average component value will be average of closing levels on July 25, 2018, Oct. 25, 2018, Jan. 25, 2019 and April 25, 2019
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| Pricing date: | Oct. 28
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| Settlement date: | Oct. 31
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| Underwriter: | HSBC Securities (USA) Inc.
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| Fees: | None
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| Cusip: | 40433BRK6
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