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Morgan Stanley Finance LLC has issued $4.955 million in Trigger GEARS securities that provide leveraged exposure to a weighted basket of six global equity indices, with settlement set for July 24, 2026. These five-year securities offer an upside gearing multiplier of 1.505 for positive returns while exposing investors to full downside risk if the basket falls below 75 percent of its initial level. This structured product targets investors seeking enhanced growth potential with acceptance of significant principal risk.
Key Points
- NYSE ticker: MS-PQ
- Issued by Morgan Stanley Finance LLC on July 22, 2026, with settlement on July 24, 2026
- Maturity date is July 24, 2031, featuring 1.505x upside gearing and a 75% downside threshold
- Priced at $10.00 per security, minimum investment of 100 securities; underwriting discount of $0.35 per security
Global Index Basket Composition and Weightings
The Trigger GEARS are linked to a diversified basket of six global indices with specific weightings to capture exposure across developed and emerging markets. The EURO STOXX 50 Index constitutes the largest allocation at 30%, with an initial level of 6,316.99 on the trade date. The MSCI Emerging Markets Index accounts for 25%, representing developing economies, with an initial level of 1,654.48.
Other indices provide regional diversification: the Nikkei Stock Average holds 18.75% with an initial level of 66,115.60; the FTSE 100 Index carries 13.125% at 10,716.97; the Swiss Market Index represents 7.5% with an initial level of 14,315.88; and the S&P/ASX 200 Index has the smallest weight of 5.625% at 8,822.973. This multi-regional basket offers exposure to key markets across Europe, emerging markets, Japan, the UK, Switzerland, and Australia.
Upside Gearing and Return Structure
The securities utilize a leveraged return mechanism applying a 1.505 multiplier to positive basket returns. If the basket return is above zero at maturity, Morgan Stanley Finance will pay investors the principal plus a return equal to the principal multiplied by the basket return and the 1.505 gearing factor. This structure enables returns approximately 50.5% higher than the underlying basket’s positive performance.
The price to public is $10.00 per security, reflecting an estimated value of $9.497 before underwriting costs. There is no cap on maximum gains, so returns depend entirely on basket performance multiplied by the gearing factor, subject to the contingent principal repayment at maturity.
Downside Protection and Principal Risk
The securities feature a contingent repayment mechanism with limited downside protection. The downside threshold is set at 75% of the initial basket level, allowing a 25% decline before principal loss occurs. If the basket return is zero or negative but the final level remains at or above 75% of the initial, full principal is repaid without additional return.
If the basket falls below the 75% threshold, investors incur a proportional principal loss based on the negative basket return. Losses can be significant or total if market conditions worsen substantially. No interest or dividends are paid during the five-year term; value depends solely on principal repayment and any positive returns at maturity.
Credit Risk and Guarantee Details
Issued by Morgan Stanley Finance LLC, the securities carry a full and unconditional guarantee from Morgan Stanley. Payment obligations, including principal and returns, rely on Morgan Stanley’s creditworthiness. Investors assume both market risk linked to the basket and credit risk of Morgan Stanley debt.
The securities are unsecured and unsubordinated debt instruments without collateral or security interest in underlying assets. In case of Morgan Stanley default, investors would be general unsecured creditors with no priority, risking partial or total loss of investment.
Terms, Dates, and Maturity
Priced and traded on July 22, 2026, with settlement on July 24, 2026, the securities mature on July 24, 2031, providing a five-year horizon. Dates may be postponed due to market disruption or non-business days to ensure accurate index valuation.
The minimum investment is 100 securities, equating to $1,000 at the $10.00 price. Contingent principal repayment applies only if held to maturity; early sales may result in market price fluctuations.
Distribution, Pricing, and Underwriting
The offering totals $4.955 million across 495,500 securities priced at $10.00 each. UBS Financial Services Inc. is the dealer, receiving a $0.35 per security sales commission paid by Morgan Stanley & Co. LLC, the agent. The underwriting discount totals $173,425, with net proceeds to Morgan Stanley Finance of $4,781,575 after fees.
Morgan Stanley & Co. LLC is an affiliate of Morgan Stanley, creating a related-party relationship. The estimated trade date value of $9.497 per security excludes underwriting costs and reflects the market value of the leveraged basket exposure with embedded derivatives and contingent principal features.
Investment Suitability and Risks
These securities carry significantly higher risk than traditional debt and are unsuitable for all investors. Morgan Stanley Finance may not repay full principal, creating uncertainty at maturity. Market risk includes potential loss of substantial or entire principal, while credit risk relates to Morgan Stanley’s debt obligations.
Investors should only purchase if they understand and accept the risks. The securities are not exchange-listed, limiting liquidity and requiring holding to maturity to benefit from contingent repayment. The combination of leverage, unlimited downside below the 75% threshold, credit risk, no interim income, and illiquidity restricts suitability to investors with appropriate risk tolerance and financial capacity.
Registration and Prospectus Information
The offering is registered under Nos. 333-293641 and 333-293641-01, with a pricing supplement filed on July 23, 2026, under Rule 424(b)(2). Morgan Stanley and MSFL have filed detailed prospectus documents with the SEC, including base, prospectus supplement, index, and tax supplements dated April 8, 2026. These are publicly accessible via the SEC EDGAR system and provide comprehensive details on Morgan Stanley, MSFL, index methodology, tax implications, and terms.
Neither the SEC nor other regulators have approved or disapproved the securities or the pricing supplement. Investors are encouraged to review full prospectus materials available free from the SEC or through Morgan Stanley or the dealer. These securities are not bank deposits, FDIC-insured, or bank-guaranteed, emphasizing their status as structured debt products.
Market Disruption and Administrative Provisions
Provisions address market disruption events that may affect index calculation or settlement. Final valuation and maturity dates may be postponed if disruptions occur or dates fall on non-business days to ensure accurate index pricing.
The securities bear CUSIP 61780K202 and ISIN US61780K2024 for standardized trading and settlement. Bloomberg tickers for each index component enable real-time basket performance monitoring throughout the investment term.
