Published on 11/29/2012 in the Prospect News Structured Products Daily.
New Issue: Morgan Stanley prices $1.06 million contingent income securities linked to gold
By Toni Weeks
San Diego, Nov. 29 - Morgan Stanley priced $1.06 million of contingent income securities due Nov. 30, 2020 linked to the price of gold, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent monthly payment at an annualized rate of 7% if the gold price closes at or above the downside threshold level - 80% of the initial gold price - on the determination date for that month.
If the gold price finishes at or above the downside threshold level, the payout at maturity will be par plus the contingent monthly payment. If the final price is less than the downside threshold level but greater than or equal to the knock-in level, 60% of the initial price, the payout at maturity will be par. If the final price is less than the knock-in level, investors will be exposed to losses from the initial price.
Morgan Stanley & Co. LLC will be the agent.
| Issuer: | Morgan Stanley
|
| Issue: | Contingent income securities
|
| Underlying commodity: | Gold
|
| Amount: | $1,056,000
|
| Maturity: | Nov. 30, 2020
|
| Coupon: | 7% per year, or $5.8333 per $1,000 principal amount of notes, if gold price closes at or above downside threshold level on determination date for that month; otherwise, no coupon will be paid that month
|
| Price: | Par
|
| Payout at maturity: | If final price is greater than or equal to downside threshold level, par plus contingent monthly payment; if final price is less than downside threshold level but greater than or equal to knock-in level, par; otherwise, full exposure to decline from initial price
|
| Initial price: | $1,746.25
|
| Downside threshold level: | $1,397.00, 80% of initial price
|
| Knock-in level: | $1,047.75, 60% of initial price
|
| Pricing date: | Nov. 27
|
| Settlement date: | Nov. 30
|
| Agent: | Morgan Stanley & Co. LLC
|
| Fees: | 3.5%
|
| Cusip: | 6174823R3
|
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