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HSBC plans leveraged market-linked step-up notes tied to index basket
By Marisa Wong
Morgantown, W.Va., Dec. 27 – HSBC USA Inc. plans to price leveraged market-linked step-up notes due December 2019 linked to a global equity basket, according to an FWP filing with the Securities and Exchange Commission.
The basket consists of the S&P 500 index, with a 40% weight, and the Euro Stoxx 50 index and the MSCI EAFE index, each with a 30% weight.
If the basket finishes above the step-up value, 118% of the initial level, the payout at maturity will be par of $10 plus 130% to 150% of the basket gain.
If the index gains by up to the step-up level, the payout will be par plus the step-up payment of 18%.
Investors will be fully exposed to any basket decline.
BofA Merrill Lynch is the agent.
The notes will price in December.
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