MS Trigger PLUS 2028 Notes: Upside Leverage, Principal at Risk Below 75%
Rhea-AI Filing Summary
Offering overview. Morgan Stanley Finance LLC, guaranteed by Morgan Stanley (NYSE: MS), is marketing “Worst-of SPX and RTY Trigger PLUS” notes maturing on August 3 2028. The $1,000-denominated securities deliver 142%-152% leveraged upside linked to the worst performer of the S&P 500® (SPX) and Russell 2000® (RTY) indices.
Key terms.
- Leverage factor: 142%–152% on any positive index return.
- Downside threshold: 75% of the initial level (25% buffer).
- Pricing date: July 31 2025; Observation date: July 31 2028; Maturity: Aug 3 2028.
- Estimated value: $963.30 versus the $1,000 issue price (reflects structuring & hedging costs).
- No coupons; securities will not be listed; full credit exposure to Morgan Stanley.
Payoff mechanics. At maturity investors receive: (i) principal plus 1.42-1.52× any positive move in the worst index; (ii) full principal if the worst index has not fallen more than 25%; (iii) a dollar-for-dollar loss if the worst index closes below 75% of its start level—potentially down to zero.
Risk highlights. Investors are exposed to (1) market risk on two equity indices, including small-cap volatility, (2) issuer/guarantor credit risk, (3) liquidity risk because the notes are unlisted, (4) valuation starting below par, and (5) uncertain U.S. tax treatment.
Bottom line. The notes suit investors with a moderately bullish 3-year view on U.S. equities who can absorb potential principal loss and illiquidity in exchange for enhanced upside and a 25% buffer.
Positive
- 142%–152% participation in index gains provides enhanced upside versus direct equity exposure.
- 25% downside buffer protects full principal unless the worst index falls more than 25% by July 31 2028.
- Diversification across large-cap (SPX) and small-cap (RTY) indices may capture broader market rallies.
- Full Morgan Stanley guarantee adds investment-grade credit backing.
Negative
- No coupon payments; total return entirely deferred to maturity.
- Worst-of structure materially raises breach probability versus single-index notes.
- Estimated value $963.30 (≈3.7% below par) signals high embedded fees and negative roll-down.
- Unlisted security may suffer wide bid-ask spreads and limited liquidity.
- Issuer credit risk; repayment depends on Morgan Stanley’s solvency.
- Uncertain U.S. tax treatment could reduce after-tax returns.
Insights
TL;DR: Leveraged upside with 25% buffer, but fees, credit and worst-of risk drag; neutral overall.
The Trigger PLUS note offers an attractive 142-152% participation rate on the better of two major U.S. benchmarks, yet embeds several investor disadvantages. The estimated value of $963.30 is roughly 3.7% below par, indicating meaningful distribution and hedging costs. Worst-of construction magnifies downside probability because both SPX and higher-beta RTY must stay above 75% to preserve capital. Lack of interim coupons or secondary-market depth further reduces appeal for income-oriented or liquidity-sensitive accounts. For Morgan Stanley, the deal adds fee revenue with minimal balance-sheet usage and is not material to earnings. From an investor standpoint, expected return is comparable to a bullish options spread; position sizing should be conservative.
TL;DR: Downside gap risk after 25% buffer and unlisted status make this product risk-heavy; mildly negative.
Historically, the Russell 2000 posts drawdowns beyond 25% about once every four years, elevating breach probability during the note’s 3-year life. The worst-of feature means that even a benign SPX result cannot offset small-cap weakness. Because the payoff depends on a single end-date observation, interim gains offer no protection against late-cycle volatility. Illiquidity creates valuation opacity, and credit-spread widening in a stress event can further erode secondary prices. While the structure may complement speculative allocations, it increases portfolio tail risk. Absent a specific tactical view, traditional equity exposure or listed options provide clearer risk-reward.
Free Writing Prospectus to Preliminary Pricing Supplement No. 9,111
Registration Statement Nos. 333-275587; 333-275587-01
Dated July 1, 2025; Filed pursuant to Rule 433
Morgan Stanley
Worst-of SPX and RTY Trigger PLUS due August 3, 2028
This document provides a summary of the terms of the securities. Investors must carefully review the accompanying preliminary pricing supplement referenced below, product supplement, index supplement and prospectus, and the “Risk Considerations” on the following page, prior to making an investment decision.
|
Terms |
|
|
Issuer: |
Morgan Stanley Finance LLC |
|
Guarantor: |
Morgan Stanley |
|
Underliers: |
S&P 500® Index (SPX) and Russell 2000® Index (RTY) |
|
Leverage factor: |
142% to 152% |
|
Downside threshold level: |
75% of the initial level for each underlier |
|
Pricing date: |
July 31, 2025 |
|
Observation date: |
July 31, 2028 |
|
Maturity date: |
August 3, 2028 |
|
CUSIP: |
61778NDA6 |
|
Estimated value: |
$963.30 per security, or within $45.00 of that estimate |
|
Preliminary pricing supplement: |
https://www.sec.gov/Archives/edgar/data/895421/000183988225035579/ms9111_424b2-19357.htm |
1All payments are subject to our credit risk
Hypothetical Payment at Maturity1
The payment at maturity will be based solely on the performance of the worst performing underlier, which could be either underlier. The payoff diagram and table below illustrate the payment at maturity for a range of hypothetical performances of the worst performing underlier over the term of the securities.
|
% Change in Closing Level of the Worst Performing Underlier |
Payment at Maturity per Security |
|
+60.00% |
$1,852.00* |
|
+40.00% |
$1,568.00* |
|
+20.00% |
$1,284.00* |
|
+10.00% |
$1,142.00* |
|
0.00% |
$1,000.00 |
|
-20.00% |
$1,000.00 |
|
-25.00% |
$1,000.00 |
|
-26.00% |
$740.00 |
|
-40.00% |
$600.00 |
|
-60.00% |
$400.00 |
|
-80.00% |
$200.00 |
|
-100.00% |
$0.00 |
*Assumes a leverage factor of 142%
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.
Underlier(s)
For more information about the underlier(s), including historical performance information, see the accompanying preliminary pricing supplement.
Risk Considerations
The risks set forth below are discussed in more detail in the “Risk Factors” section in the accompanying preliminary pricing supplement. Please review those risk factors carefully prior to making an investment decision.
Risks Relating to an Investment in the Securities
●The securities do not guarantee the return of any principal and do not pay interest.
●The amount payable on the securities is not linked to the values of the underliers at any time other than the observation date.
●The market price of the securities may be influenced by many unpredictable factors.
●The 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 securities.
●As a finance subsidiary, MSFL has no independent operations and will have no independent assets.
●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 securities in the original issue price reduce the economic terms of the securities, cause the estimated value of the securities to be less than the original issue price and will adversely affect secondary market prices.
●The estimated value of the 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.
●The securities will not be listed on any securities exchange and secondary trading may be limited.
●As discussed in more detail in the accompanying product supplement, investing in the securities is not equivalent to investing in the underlier(s).
●The U.S. federal income tax consequences of an investment in the securities are uncertain.
Risks Relating to the Underlier(s)
●Because your return on the securities will depend upon the performance of the underlier(s), the securities are subject to the following risk(s), as discussed in more detail in the accompanying product supplement.
oYou are exposed to the price risk of each underlier.
oBecause the securities are linked to the performance of the worst performing underlier, you are exposed to a greater risk of not receiving a positive return on the securities and/or sustaining a significant loss on your investment than if the securities were linked to just one underlier.
oAdjustments to an underlying index could adversely affect the value of the securities.
●The securities are subject to risks associated with small-capitalization companies.
Risks Relating to Conflicts of Interest
●The calculation agent, which is a subsidiary of Morgan Stanley and an affiliate of MSFL, will make determinations with respect to the securities.
●Hedging and trading activity by our affiliates could potentially adversely affect the value of the securities.
Tax Considerations
You should review carefully the discussion in the accompanying preliminary pricing supplement under the caption “Additional Information About the Securities– United States federal income tax considerations” concerning the U.S. federal income tax consequences of an investment in the securities, and you should consult your tax adviser.