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HSBC to price capped knock-out buffer notes linked to S&P 500
By Jennifer Chiou
New York, Feb. 29 - HSBC USA Inc. plans to price 0% knock-out buffer notes due March 20, 2013 linked to the S&P 500 index, according to an FWP with the Securities and Exchange Commission.
A knock-out event occurs if the index falls by more than 20% on any day during the life of the notes.
If a knock-out event does not occur, the payout at maturity will be par plus the contingent return of 4.75%.
If a knock-out event occurs, the payout at maturity will be par plus the index return. Investors will be fully exposed to losses.
The return will be capped at 20% in either case.
The notes (Cusip: 4042K1YK3) are expected to price on March 2 and settle on March 7.
HSBC Securities (USA) Inc. is the underwriter with J.P. Morgan Securities LLC as the agent.
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