Published on 12/21/2021 in the Prospect News Structured Products Daily.
New Issue: Morgan Stanley sells $3 million floating-rate trigger callable contingent yield notes
By William Gullotti
Buffalo, N.Y., Dec. 21 – Morgan Stanley Finance LLC priced $3 million of floating-rate trigger callable contingent yield notes due Dec. 7, 2026 linked to the least performing of the Nasdaq-100 index, the Dow Jones industrial average and the Russell 2000 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes are guaranteed by Morgan Stanley
Each quarter, the notes pay a contingent coupon if each index’s closing level is at or above its coupon barrier, 70% of its initial level, on the observation date that quarter. The contingent coupon rate is SOFR plus 500 basis points per year subject to a floor of zero.
After six months, the notes are callable at par plus any coupon otherwise due on each quarterly observation date other than the final one.
If the notes are not called and each index finishes at or above its coupon barrier, the payout at maturity will be par plus the final coupon, if any.
If the worst performer finishes below its coupon barrier but at or above its downside threshold, 60% of its initial level, the payout at maturity will be par. Otherwise, investors will lose 1% for every 1% that the worst performer’s final level is below its initial level.
Morgan Stanley is the agent with UBS Financial Services Inc. acting as distributor.
| Issuer: | Morgan Stanley Finance LLC
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| Guarantor: | Morgan Stanley
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| Issue: | Trigger callable contingent yield notes
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| Underlying indexes: | Nasdaq-100, Russell 2000 and Dow Jones industrial average
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| Amount: | $3 million
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| Maturity: | Dec. 7, 2026
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| Coupon: | SOFR plus 500 basis points per year, payable quarterly if each index closes at or above its coupon barrier on observation date that quarter; floor of zero
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| Price: | Par of $10
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| Payout at maturity: | If each index finishes at or above coupon barrier, par plus final coupon; if worst performer finishes below its coupon barrier but at or above downside threshold, par; otherwise, 1% loss for every 1% that the worst performer’s final level is below initial level
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| Call option: | At par plus any coupon due on each quarterly observation date after six months
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| Initial levels: | 2,206.333 for Russell, 15,990.76 for Nasdaq, 34,639.79 for Dow
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| Coupon barriers: | 1,544.433 for Russell, 11,193.53 for Nasdaq, 24,247.85 for Dow; 70% of initial levels
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| Downside thresholds: | 1,323.8 for Russell, 9,594.46 for Nasdaq, 20,783.87 for Dow; 60% of initial levels
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| Pricing date: | Dec. 2
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| Settlement date: | Dec. 7
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| Agent: | Morgan Stanley
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| Distributor: | UBS Financial Services Inc.
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| Fees: | 1.5%
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| Cusip: | 61773N239
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