Morgan Stanley plans lookback return optimization notes on S&P 500

By Marisa Wong

Madison, Wis., Dec. 6 - Morgan Stanley plans to price 0% lookback return optimization securities due June 19, 2014 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

The starting level will be the lowest index closing level during the lookback period that is not greater than the closing level of the index on the pricing date. The lookback period consists of each trading day from and including the pricing date to and including Jan. 14.

The ending level will be the closing level of the index on the June 16, 2014 final valuation date.

If the index return is positive, the payout at maturity will be par plus double the gain, subject to a maximum return of 14% to 16.5% that will be set at pricing.

If the index return is negative, investors will be fully exposed to losses.

The notes (Cusip: 61761M128) are expected to price on Dec. 14 and settle on Dec. 19.

Morgan Stanley & Co. LLC and UBS Financial Services Inc. are the agents.

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