Free Writing Prospectus - Filing Under Securities Act Rules 163/433 (fwp)
April 25 2019 - 6:07AM
Edgar (US Regulatory)
M
organ
S
tanley
F
inance
LLC
Structured
Investments
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Free Writing Prospectus to Preliminary
Terms No. 1,865
Registration Statement Nos. 333-221595;
333-221595-01
Dated April 24, 2019
Filed pursuant to Rule 433
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Buffered Participation Securities Based on
the Value of the S&P 500
®
Index due May 31, 2024
Principal at Risk Securities
This document provides a summary of the terms of the Buffered
Securities offered by Morgan Stanley Finance LLC. Investors should review carefully the accompanying preliminary terms, product
supplement, index supplement and prospectus prior to making an investment decision. Investing in the Buffered Securities involves
risks. See “Selected Risks” on the following page and “Risk Factors” in the accompanying preliminary terms.
SUMMARY
TERMS
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Issuer:
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Morgan Stanley Finance
LLC (“MSFL”)
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Guarantor:
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Morgan Stanley
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Maturity date:
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May 31, 2024
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Underlying index:
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S&P 500
®
Index. For
more information about the underlying index, including historical performance information, see the accompanying preliminary
terms.
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Upside payment:
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$1,000 × index percent increase
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Index percent increase:
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(final index value – initial
index value) / initial index value
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Initial index value:
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The index closing value on the
pricing date
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Final index value:
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The index closing value on the valuation
date
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Valuation date:
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May 28, 2024, subject to postponement
for non-index business days and certain market disruption events
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Buffer amount:
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At least 26%. The actual buffer amount will be
determined on the pricing date.
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Minimum payment at maturity:
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At least $260 per Buffered Security
(at least 26% of the stated principal amount). The actual minimum payment at maturity will be determined on the pricing date.
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Index performance factor:
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Final index value
divided
by the initial index value
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Stated principal amount:
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$1,000 per Buffered Security
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Pricing date:
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May 28, 2019
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Original
issue date:
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May 31, 2019 (3 business days
after the pricing date)
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CUSIP/ISIN:
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61768D6X8 / US61768D6X81
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Estimated
value on the pricing date:
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Approximately $948.30 per Buffered
Security, or within $30.00 of that estimate. See “Investment Summary” in the accompanying preliminary
terms.
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Payment at Maturity per Buffered Security
Hypothetical Payout on the Buffered Securities
The payoff diagram below illustrates the payment at maturity on
the Buffered Securities, assuming a hypothetical buffer amount of 26%.
The issuer has filed a registration statement (including a prospectus)
with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that
registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and
this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively,
the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request
it by calling toll-free 1-800-584-6837.
Risk Considerations
The risks set forth below are discussed in more detail in the
“Risk Factors” section in the accompanying preliminary terms. Please review those risk factors carefully prior to making
an investment decision.
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·
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Buffered
Securities do not pay interest and provide a minimum payment at maturity of only at least 26% of your principal.
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·
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The
market price of the Buffered Securities will be influenced by many unpredictable factors.
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The Buffered Securities are subject to our
credit risk, and any actual or anticipated changes to our credit ratings or credit spreads may adversely affect the market value
of the Buffered Securities.
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As
a finance subsidiary, MSFL has no independent operations and will have no independent assets.
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The
amount payable on the Buffered Securities is not linked to the value of the underlying index at any time other than the valuation
date.
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·
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Investing
in the Buffered Securities is not equivalent to investing in the underlying index.
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·
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The rate we are willing to pay for securities
of this type, maturity and issuance size is likely to be lower than the rate implied by our secondary market credit spreads and
advantageous to us. Both the lower rate and the inclusion of costs associated with issuing, selling, structuring and hedging the
Buffered Securities in the original issue price reduce the economic terms of the Buffered Securities, cause the estimated value
of the Buffered Securities to be less than the original issue price and will adversely affect secondary market prices.
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Adjustments to the underlying index could
adversely affect the value of the Buffered Securities.
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·
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The estimated value of the Buffered Securities
is determined by reference to our pricing and valuation models, which may differ from those of other dealers and is not a maximum
or minimum secondary market price.
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The Buffered Securities will not be listed
on any securities exchange and secondary trading may be limited.
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·
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The calculation agent, which is a subsidiary
of Morgan Stanley and an affiliate of MSFL, will make determinations with respect to the Buffered Securities.
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·
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Hedging and trading activity by our affiliates
could potentially adversely affect the value of the Buffered Securities.
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·
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The U.S. federal income tax consequences of
an investment in the Buffered Securities are uncertain.
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Tax Considerations
You should review carefully the discussion in the accompanying
preliminary terms under the caption “Additional Information About the Buffered Securities– Tax considerations”
concerning the U.S. federal income tax consequences of an investment in the Buffered Securities. However, you should consult your
tax adviser regarding all aspects of the U.S. federal income tax consequences of an investment in the Buffered Securities, as well
as any tax consequences arising under the laws of any state, local or non-U.S. taxing jurisdiction.
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