Published on 3/28/2024 in the Prospect News Structured Products Daily.
New Issue: Morgan Stanley sells $4.2 million callable contingent market-linked notes on indexes
By William Gullotti
Buffalo, N.Y., March 28 – Morgan Stanley Finance LLC priced $4.2 million of market-linked securities – callable with contingent coupon and contingent downside due Sept. 24, 2026 linked to the performance of the S&P 500 index, the Russell 2000 index and the Nasdaq-100 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes are guaranteed by Morgan Stanley.
The notes will pay a contingent quarterly interest payment at the rate of 8.45% per year if each index closes at or above the coupon barrier level, 75% of the initial level, on the observation date for that period.
After six months, the notes may be called at par plus any interest payment otherwise due on any quarterly observation date.
The payout at maturity will be par plus the final interest payment if each index finishes at or above its coupon barrier.
If the worst performer finishes below its coupon barrier but at or above the 70% downside threshold, the payout will be par. Otherwise, investors will be fully exposed to the decline of the worst performer from its initial level.
Morgan Stanley & Co. LLC and Wells Fargo Securities, LLC are the agents.
| Issuer: | Morgan Stanley Finance LLC
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| Guarantor: | Morgan Stanley
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| Issue: | Market linked securities – callable with contingent coupon and contingent downside
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| Underlying indexes: | S&P 500 index, Russell 2000 index, Nasdaq-100 index
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| Amount: | $4.2 million
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| Maturity: | Sept. 24, 2026
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| Coupon: | 8.45% annual rate, payable quarterly if all indexes close at or above their coupon barrier levels on the relevant observation date
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| Price: | Par
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| Payout at maturity: | Par plus final coupon if each index finishes at or above coupon barrier; if worst performer finishes below coupon barrier but at or above downside threshold, par; otherwise, 1% loss for every 1% decline of worst performer from its initial level
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| Call option: | At par plus any coupon otherwise due on any quarterly observation date after six months
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| Initial levels: | 5,224.62 for S&P, 2,074.88 for Russell, 18,240.11 for Nasdaq
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| Coupon barriers: | 3,918.465 for S&P, 1,556.16 for Russell, 13,680.0825 for Nasdaq; 75% of initial levels
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| Downside thresholds: | 3,657.234 for S&P, 1,452.416 for Russell, 12,768.077 for Nasdaq; 70% of initial levels
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| Pricing date: | March 20
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| Settlement date: | March 25
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| Agents: | Morgan Stanley & Co. LLC and Wells Fargo Securities, LLC
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| Fees: | 2.325%
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| Cusip: | 61776LEM5
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