By Toni Weeks
San Diego, Jan. 24 - Morgan Stanley priced $4.19 million of 0% trigger phoenix autocallable optimization securities due Jan. 24, 2018 linked to the iShares Russell 2000 index fund and the SPDR S&P 500 ETF Trust, according to a 424B filing with the Securities and Exchange Commission.
If both funds close at or above the 66.59% trigger level on any quarterly observation date, the notes will pay a contingent coupon of 8% for that quarter.
If both funds close at or above the initial price on any quarterly observation date after one year, the notes will be called at par of $10 plus the contingent coupon.
If the notes are not called, the payout at maturity will be par plus the contingent coupon unless either fund finishes below the trigger price, in which case investors will be fully exposed to the decline of the least-performing fund.
UBS Financial Services Inc. and Morgan Stanley & Co. LLC are the agents.
Issuer: | Morgan Stanley
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Issue: | Trigger phoenix autocallable optimization securities
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Underlying funds: | iShares Russell 2000 index fund and SPDR S&P 500 ETF Trust
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Amount: | $4,190,900
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Maturity: | Jan. 24, 2018
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Coupon: | 8% per year, payable quarterly if fund closes at or above trigger price on observation date for that quarter
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Price: | Par of $10.00
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Payout at maturity: | Par plus contingent coupon if fund finishes at or above trigger price; otherwise, par plus return of least-performing fund
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Call: | At par plus contingent coupon if funds close at or above initial prices on quarterly observation date beginning Jan. 24, 2014
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Initial levels: | $89.21 for Russell, $149.10 for S&P
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Trigger levels: | $59.40 for Russell, $99.29 for S&P; 66.59% of initial prices
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Pricing date: | Jan. 22
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Settlement date: | Jan. 24
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Agents: | UBS Financial Services Inc. and Morgan Stanley & Co. LLC
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Fees: | 2.5%
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Cusip: | 61761M334
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