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Morgan Stanley Finance LLC has launched structured investment securities that provide leveraged upside linked to the performance of Broadcom Inc. and NVIDIA Corporation common stocks, along with an automatic early redemption feature. Issued on July 23, 2026, these principal-at-risk securities are fully guaranteed by Morgan Stanley. Investors should be aware of potential significant losses if either underlying stock drops substantially below set thresholds during the two-year term.
Key Points
- NYSE ticker: MS-PQ
- Jump Securities issued by Morgan Stanley Finance LLC with auto-callable features tied to Broadcom and NVIDIA stock performance, priced at $1,000 each
- Pricing date: July 20, 2026; maturity date: July 20, 2028; first early redemption determination date: July 30, 2027
- Early redemption payment of $1,545.10 per security if both stocks close at or above call thresholds; 300% participation rate on upside if both stocks appreciate
- Downside thresholds set at 60% of initial levels for AVGO ($222.495) and NVDA ($121.686) stocks
- Estimated security value approximately $979.60 on pricing date; agent commission of $15 per $1,000 principal
Issuer Information and Structured Product Details
Under its Series A Global Medium-Term Notes program, Morgan Stanley Finance LLC issued these Jump Securities on July 23, 2026, following pricing on July 20, 2026. These unsecured obligations are fully and unconditionally guaranteed by Morgan Stanley. Morgan Stanley & Co. LLC acts as the agent, while J.P. Morgan Securities LLC and JPMorgan Chase Bank, N.A. serve as placement agents. Each security has a stated principal and issue price of $1,000. The total principal amount offered has not been disclosed.
Designed for institutional and sophisticated investors, these complex securities expose investors to principal risk in exchange for potential enhanced returns. The dual-underlier structure means Broadcom and NVIDIA stock performances jointly determine payment outcomes. The estimated value of approximately $979.60 per security at pricing reflects embedded issuance, distribution, structuring, and hedging costs that reduce economic value below face amount.
Dual Underlier Framework and Initial Reference Prices
Linked to Broadcom Inc. (AVGO) and NVIDIA Corporation (NVDA), the securities use a "worst performing" underlier approach. Initial reference levels were established on July 17, 2026, with AVGO closing at $370.825 and NVDA at $202.81. These prices serve as baselines for performance measurement throughout the two-year term.
This structure does not offer diversification benefits; instead, the worst-performing stock dictates returns. The filing highlights that a decline in either stock below its downside threshold adversely impacts returns, regardless of the other stock's performance.
Automatic Early Redemption and Call Thresholds
An automatic early redemption feature activates if both stocks close at or above their call thresholds on the first determination date, July 30, 2027. The call thresholds equal 100% of initial levels: $370.825 for AVGO and $202.81 for NVDA. If met, securities redeem early on August 4, 2027, with no further payments thereafter.
Early redemption pays $1,545.10 per security, representing a 54.51% return over roughly one year, contingent on both stocks maintaining or exceeding initial levels. If either stock closes below its call threshold on the determination date, early redemption does not occur, and securities continue to maturity.
Maturity Payment Scenarios and Return Mechanics
At maturity on July 20, 2028, payments depend on final closing levels on July 17, 2028. Three scenarios apply: if both stocks exceed initial levels, investors receive principal plus 300% participation on the worst-performing stock's gain, delivering leveraged upside. If one or both stocks finish at or below initial levels but remain above downside thresholds, investors receive principal only. If either stock falls below its downside threshold, payments are reduced proportionally to the worst-performing stock's decline, potentially resulting in significant principal loss.
Downside Thresholds and Loss Potential
Downside thresholds are set at 60% of initial levels: $222.495 for AVGO and $121.686 for NVDA. Falling below these thresholds results in payments significantly less than principal, possibly zero. For example, a 70% decline to 30% of initial level would yield a payment equal to 30% of principal, causing a substantial loss.
Pricing, Fees, and Economic Considerations
Each security was issued at $1,000, with Morgan Stanley & Co. receiving $15 in commissions per $1,000 principal. Net proceeds to Morgan Stanley Finance LLC are $985 per security. Placement agents waive fees for certain fiduciary accounts; the $15 commission applies to non-fiduciary sales.
The estimated value of $979.60 per security on pricing date, subject to a $25 variance, reflects embedded structuring, hedging, and distribution costs. Purchasing at face value entails an immediate paper loss relative to estimated fair value, a common feature of such structured products.
Credit Risk and Guarantee Details
These unsecured obligations are guaranteed by Morgan Stanley, exposing investors to its credit risk. Payments depend on Morgan Stanley's ability to fulfill obligations; default could result in partial or total loss. Investors have no security interest in underlying stocks. The filing notes these securities are not bank deposits, are uninsured by the FDIC or any government agency, and are not bank obligations.
Investors face combined risks from Broadcom and NVIDIA stock performance and Morgan Stanley's creditworthiness. Favorable stock performance does not eliminate the risk of Morgan Stanley default, and poor stock performance combined with credit deterioration can compound losses.
Risk Profile and Suitability
The securities are intended for investors willing to risk principal and forego current income for potential early redemption or maturity payments exceeding principal. No regular interest is paid; returns depend entirely on stock price movements and redemption or maturity events.
The worst-performing underlier structure concentrates downside risk, as a decline in either stock below its threshold adversely affects returns. The filing stresses that multiple underliers do not provide diversification benefits. Investors must accept the possibility of losing their entire investment based on Broadcom and NVIDIA stock performance over two years.
Regulatory Filings and Documentation
Filed under Rule 424(b)(2) of the Securities Act with registration numbers 333-293641 and 333-293641-01, this preliminary pricing supplement (No. 17,505) dated July 20, 2026, serves as initial disclosure. The securities’ CUSIP is 61781GP62 and ISIN is US61781GP626, facilitating trading and settlement.
Offering documents include a product supplement, tax supplement, and prospectus dated April 8, 2026, detailing legal, tax, and risk information. The securities will not be listed on any exchange, limiting secondary market liquidity and potentially restricting early exit opportunities.
Term Length and Important Dates
The securities have a two-year term from July 23, 2026, to July 20, 2028. The final determination date for maturity payment is July 17, 2028, subject to adjustment for non-trading days or market disruptions. The first early redemption determination date is July 30, 2027, about one year post-issuance. If early redemption occurs, investors receive proceeds approximately thirteen months before maturity; otherwise, they remain invested for the full term.
Initial reference prices were established on July 17, 2026, three days prior to pricing.
