[FWP] Royal Bank of Canada Free Writing Prospectus
Royal Bank of Canada (RBC) has filed a Free Writing Prospectus for Market-Linked One Look Notes with Enhanced Buffer tied to the common stock of Tesla, Inc. (TSLA). Each $10 unit matures in roughly 14 months and offers a fixed Step Up Payment of $3.00–$3.60 (30%-36% return) provided TSLA’s ending value is at least 85% of its starting value. If TSLA declines by more than 15%, investors incur 1-for-1 downside exposure; the maximum loss is 85% of principal. The structure therefore protects the first 15% decline but caps upside at the Step Up Payment.
The notes will not be listed on an exchange, and RBC does not expect a secondary market. Investors face RBC credit risk; changes in the bank’s perceived creditworthiness or hedging activities may affect note value. The public offering price will exceed RBC’s initial estimated value, creating an inherent premium. Tax treatment remains uncertain.
Key terms are finalized on the pricing date. Investors should consult the linked preliminary offering documents for full disclosure, risk factors, and U.S. federal tax considerations.
Royal Bank of Canada (RBC) ha depositato un Free Writing Prospectus per le Market-Linked One Look Notes con Buffer Potenziato legate alle azioni ordinarie di Tesla, Inc. (TSLA). Ogni unità da 10$ scade in circa 14 mesi e offre un Pagamento Step Up fisso da 3,00$ a 3,60$ (rendimento del 30%-36%) a condizione che il valore finale di TSLA sia almeno l'85% di quello iniziale. Se TSLA scende di oltre il 15%, gli investitori subiscono una perdita diretta 1 a 1; la perdita massima è l'85% del capitale investito. La struttura quindi protegge dal primo calo del 15%, ma limita il guadagno al Pagamento Step Up.
Le note non saranno quotate in borsa e RBC non prevede un mercato secondario. Gli investitori sono esposti al rischio di credito di RBC; variazioni nella percezione della solidità creditizia della banca o nelle attività di copertura possono influenzare il valore delle note. Il prezzo di offerta pubblica sarà superiore al valore stimato iniziale di RBC, creando un premio implicito. Il trattamento fiscale è ancora incerto.
I termini chiave saranno definiti alla data di pricing. Gli investitori dovrebbero consultare i documenti preliminari collegati per una completa divulgazione, fattori di rischio e considerazioni fiscali federali statunitensi.
Royal Bank of Canada (RBC) ha presentado un Free Writing Prospectus para las Market-Linked One Look Notes con Buffer Mejorado vinculadas a las acciones ordinarias de Tesla, Inc. (TSLA). Cada unidad de 10$ vence en aproximadamente 14 meses y ofrece un Pago Step Up fijo de 3,00$ a 3,60$ (rendimiento del 30%-36%) si el valor final de TSLA es al menos el 85% del valor inicial. Si TSLA cae más del 15%, los inversores enfrentan una exposición a la baja 1 a 1; la pérdida máxima es el 85% del principal. La estructura protege la primera caída del 15% pero limita la ganancia al Pago Step Up.
Las notas no estarán listadas en ninguna bolsa y RBC no espera un mercado secundario. Los inversores asumen riesgo crediticio de RBC; cambios en la percepción de la solvencia del banco o en sus actividades de cobertura pueden afectar el valor de las notas. El precio público de oferta excederá el valor estimado inicial de RBC, creando una prima implícita. El tratamiento fiscal es incierto.
Los términos clave se finalizarán en la fecha de fijación de precio. Los inversores deben consultar los documentos preliminares vinculados para una divulgación completa, factores de riesgo y consideraciones fiscales federales de EE.UU.
Royal Bank of Canada(RBC)는 Tesla, Inc.(TSLA) 보통주에 연동된 향상된 버퍼가 포함된 Market-Linked One Look Notes에 대한 Free Writing Prospectus를 제출했습니다. 각 10달러 단위는 약 14개월 후 만기되며, TSLA의 최종 가치가 시작 가치의 최소 85%인 경우 고정된 3.00달러~3.60달러 Step Up 지급(30%-36% 수익률)을 제공합니다. TSLA가 15% 이상 하락하면 투자자는 1대1 하락 노출을 겪으며, 최대 손실은 원금의 85%입니다. 따라서 이 구조는 최초 15% 하락을 보호하지만 상승은 Step Up 지급으로 제한됩니다.
이 노트는 거래소에 상장되지 않으며, RBC는 2차 시장이 형성될 것으로 예상하지 않습니다. 투자자는 RBC 신용 위험에 노출되며, 은행의 신용도 변화나 헤지 활동이 노트 가치에 영향을 미칠 수 있습니다. 공개 발행 가격은 RBC의 초기 추정 가치를 초과하여 내재된 프리미엄을 형성합니다. 세금 처리 방식은 아직 불확실합니다.
주요 조건은 가격 결정일에 확정됩니다. 투자자는 전체 공시, 위험 요소 및 미국 연방 세금 고려 사항을 위해 연결된 예비 공모 문서를 참조해야 합니다.
La Royal Bank of Canada (RBC) a déposé un Free Writing Prospectus pour des Market-Linked One Look Notes avec Buffer Amélioré liées aux actions ordinaires de Tesla, Inc. (TSLA). Chaque unité de 10$ arrive à échéance en environ 14 mois et offre un paiement fixe Step Up de 3,00$ à 3,60$ (rendement de 30%-36%)
Les notes ne seront pas cotées en bourse, et RBC ne prévoit pas de marché secondaire. Les investisseurs sont exposés au risque de crédit de RBC ; les changements dans la perception de la solvabilité de la banque ou dans ses activités de couverture peuvent affecter la valeur des notes. Le prix d’offre public sera supérieur à la valeur estimée initiale de RBC, créant ainsi une prime implicite. Le traitement fiscal reste incertain.
Les termes clés seront finalisés à la date de tarification. Les investisseurs doivent consulter les documents préliminaires liés pour une divulgation complète, les facteurs de risque et les considérations fiscales fédérales américaines.
Die Royal Bank of Canada (RBC) hat einen Free Writing Prospectus für Market-Linked One Look Notes mit verbessertem Puffer eingereicht, die an die Stammaktien von Tesla, Inc. (TSLA) gekoppelt sind. Jede 10$-Einheit läuft in etwa 14 Monaten ab und bietet eine feste Step Up Zahlung von 3,00$ bis 3,60$ (30%-36% Rendite) vorausgesetzt, der Endwert von TSLA liegt bei mindestens 85% des Anfangswerts. Fällt TSLA um mehr als 15%, tragen die Anleger eine 1-zu-1-Abwärtsrisikoexposition; der maximale Verlust beträgt 85% des Kapitals. Die Struktur schützt somit vor einem ersten Rückgang von 15%, begrenzt aber die Aufwärtschance auf die Step Up Zahlung.
Die Notes werden nicht an einer Börse notiert sein, und RBC erwartet keinen Sekundärmarkt. Anleger sind dem RBC-Kreditrisiko ausgesetzt; Änderungen in der wahrgenommenen Kreditwürdigkeit der Bank oder in deren Absicherungsaktivitäten können den Wert der Notes beeinflussen. Der öffentliche Ausgabepreis wird den anfänglichen geschätzten Wert von RBC übersteigen, was eine eingebaute Prämie darstellt. Die steuerliche Behandlung ist ungewiss.
Die wichtigsten Bedingungen werden am Preisfestsetzungstag finalisiert. Anleger sollten die verlinkten vorläufigen Angebotsunterlagen für vollständige Offenlegungen, Risikofaktoren und US-Bundessteuerüberlegungen konsultieren.
- 30%-36% fixed upside if TSLA ends at or above 85% of start value, achievable even in modestly negative scenarios.
- 15% downside buffer provides limited capital protection versus direct equity ownership.
- Principal at risk beyond 15% decline; worst-case loss is 85% of invested capital.
- Upside capped at the Step Up Payment, forfeiting gains if TSLA rises sharply.
- No exchange listing or expected secondary market, creating significant liquidity risk.
- Subject to RBC credit risk; deterioration in the bank’s credit spreads can depress note value.
- Offering price exceeds estimated fair value, embedding an immediate mark-to-market discount.
- Uncertain U.S. federal tax treatment may complicate after-tax returns.
Insights
TL;DR Capped 30-36% upside, 15% buffer, 85% max loss, plus RBC credit and liquidity risks make this a niche yield-enhancement play.
Product economics: The fixed Step Up Payment delivers equity-like return if TSLA is flat or down <15%, but investors surrender unlimited upside above ~3%-4% equity gain. At-the-money option replication suggests RBC embeds a sizeable option premium, reflected in the initial estimated value discount.
Risk profile: Principal is largely unprotected; a 20% drop in TSLA trims principal by 5%. Absent an active market, exit before maturity is difficult and likely at a discount. Credit exposure to RBC (Moody’s Aa2) is modest but non-zero.
Suitability: Attractive for investors seeking short-dated, conditional yield and who are neutral-to-modestly bullish on TSLA, but inappropriate for those needing liquidity or full principal protection.
TL;DR Structure adds issuer credit and liquidity risk while capping gains; risk-adjusted return inferior to direct TSLA or diversified equity.
Impact assessment: From a portfolio perspective, the note behaves like a short call on TSLA funded by a long bond, exposing holders to tail risk during sharp sell-offs. The 15% buffer offers limited protection versus historical TSLA volatility (>60% annualized). Liquidity constraints and uncertain tax treatment further erode attractiveness.
Issuer impact: The deal is immaterial to RBC’s balance sheet; proceeds count as wholesale funding at favorable spreads. Investors should view this as a tactical instrument rather than a core holding.
Royal Bank of Canada (RBC) ha depositato un Free Writing Prospectus per le Market-Linked One Look Notes con Buffer Potenziato legate alle azioni ordinarie di Tesla, Inc. (TSLA). Ogni unità da 10$ scade in circa 14 mesi e offre un Pagamento Step Up fisso da 3,00$ a 3,60$ (rendimento del 30%-36%) a condizione che il valore finale di TSLA sia almeno l'85% di quello iniziale. Se TSLA scende di oltre il 15%, gli investitori subiscono una perdita diretta 1 a 1; la perdita massima è l'85% del capitale investito. La struttura quindi protegge dal primo calo del 15%, ma limita il guadagno al Pagamento Step Up.
Le note non saranno quotate in borsa e RBC non prevede un mercato secondario. Gli investitori sono esposti al rischio di credito di RBC; variazioni nella percezione della solidità creditizia della banca o nelle attività di copertura possono influenzare il valore delle note. Il prezzo di offerta pubblica sarà superiore al valore stimato iniziale di RBC, creando un premio implicito. Il trattamento fiscale è ancora incerto.
I termini chiave saranno definiti alla data di pricing. Gli investitori dovrebbero consultare i documenti preliminari collegati per una completa divulgazione, fattori di rischio e considerazioni fiscali federali statunitensi.
Royal Bank of Canada (RBC) ha presentado un Free Writing Prospectus para las Market-Linked One Look Notes con Buffer Mejorado vinculadas a las acciones ordinarias de Tesla, Inc. (TSLA). Cada unidad de 10$ vence en aproximadamente 14 meses y ofrece un Pago Step Up fijo de 3,00$ a 3,60$ (rendimiento del 30%-36%) si el valor final de TSLA es al menos el 85% del valor inicial. Si TSLA cae más del 15%, los inversores enfrentan una exposición a la baja 1 a 1; la pérdida máxima es el 85% del principal. La estructura protege la primera caída del 15% pero limita la ganancia al Pago Step Up.
Las notas no estarán listadas en ninguna bolsa y RBC no espera un mercado secundario. Los inversores asumen riesgo crediticio de RBC; cambios en la percepción de la solvencia del banco o en sus actividades de cobertura pueden afectar el valor de las notas. El precio público de oferta excederá el valor estimado inicial de RBC, creando una prima implícita. El tratamiento fiscal es incierto.
Los términos clave se finalizarán en la fecha de fijación de precio. Los inversores deben consultar los documentos preliminares vinculados para una divulgación completa, factores de riesgo y consideraciones fiscales federales de EE.UU.
Royal Bank of Canada(RBC)는 Tesla, Inc.(TSLA) 보통주에 연동된 향상된 버퍼가 포함된 Market-Linked One Look Notes에 대한 Free Writing Prospectus를 제출했습니다. 각 10달러 단위는 약 14개월 후 만기되며, TSLA의 최종 가치가 시작 가치의 최소 85%인 경우 고정된 3.00달러~3.60달러 Step Up 지급(30%-36% 수익률)을 제공합니다. TSLA가 15% 이상 하락하면 투자자는 1대1 하락 노출을 겪으며, 최대 손실은 원금의 85%입니다. 따라서 이 구조는 최초 15% 하락을 보호하지만 상승은 Step Up 지급으로 제한됩니다.
이 노트는 거래소에 상장되지 않으며, RBC는 2차 시장이 형성될 것으로 예상하지 않습니다. 투자자는 RBC 신용 위험에 노출되며, 은행의 신용도 변화나 헤지 활동이 노트 가치에 영향을 미칠 수 있습니다. 공개 발행 가격은 RBC의 초기 추정 가치를 초과하여 내재된 프리미엄을 형성합니다. 세금 처리 방식은 아직 불확실합니다.
주요 조건은 가격 결정일에 확정됩니다. 투자자는 전체 공시, 위험 요소 및 미국 연방 세금 고려 사항을 위해 연결된 예비 공모 문서를 참조해야 합니다.
La Royal Bank of Canada (RBC) a déposé un Free Writing Prospectus pour des Market-Linked One Look Notes avec Buffer Amélioré liées aux actions ordinaires de Tesla, Inc. (TSLA). Chaque unité de 10$ arrive à échéance en environ 14 mois et offre un paiement fixe Step Up de 3,00$ à 3,60$ (rendement de 30%-36%)
Les notes ne seront pas cotées en bourse, et RBC ne prévoit pas de marché secondaire. Les investisseurs sont exposés au risque de crédit de RBC ; les changements dans la perception de la solvabilité de la banque ou dans ses activités de couverture peuvent affecter la valeur des notes. Le prix d’offre public sera supérieur à la valeur estimée initiale de RBC, créant ainsi une prime implicite. Le traitement fiscal reste incertain.
Les termes clés seront finalisés à la date de tarification. Les investisseurs doivent consulter les documents préliminaires liés pour une divulgation complète, les facteurs de risque et les considérations fiscales fédérales américaines.
Die Royal Bank of Canada (RBC) hat einen Free Writing Prospectus für Market-Linked One Look Notes mit verbessertem Puffer eingereicht, die an die Stammaktien von Tesla, Inc. (TSLA) gekoppelt sind. Jede 10$-Einheit läuft in etwa 14 Monaten ab und bietet eine feste Step Up Zahlung von 3,00$ bis 3,60$ (30%-36% Rendite) vorausgesetzt, der Endwert von TSLA liegt bei mindestens 85% des Anfangswerts. Fällt TSLA um mehr als 15%, tragen die Anleger eine 1-zu-1-Abwärtsrisikoexposition; der maximale Verlust beträgt 85% des Kapitals. Die Struktur schützt somit vor einem ersten Rückgang von 15%, begrenzt aber die Aufwärtschance auf die Step Up Zahlung.
Die Notes werden nicht an einer Börse notiert sein, und RBC erwartet keinen Sekundärmarkt. Anleger sind dem RBC-Kreditrisiko ausgesetzt; Änderungen in der wahrgenommenen Kreditwürdigkeit der Bank oder in deren Absicherungsaktivitäten können den Wert der Notes beeinflussen. Der öffentliche Ausgabepreis wird den anfänglichen geschätzten Wert von RBC übersteigen, was eine eingebaute Prämie darstellt. Die steuerliche Behandlung ist ungewiss.
Die wichtigsten Bedingungen werden am Preisfestsetzungstag finalisiert. Anleger sollten die verlinkten vorläufigen Angebotsunterlagen für vollständige Offenlegungen, Risikofaktoren und US-Bundessteuerüberlegungen konsultieren.
Registration Statement No. 333-275898
Filed Pursuant to Rule 433
| Market-Linked One Look Notes with Enhanced Buffer |
| Market-Linked One Look Notes with Enhanced Buffer Linked to the Common Stock of Tesla, Inc. | |
| Issuer | Royal Bank of Canada (“RBC”). References on this page to “we,” “us” or “our” mean RBC. |
| Principal Amount | $10.00 per unit |
| Term | Approximately 14 months |
| Market Measure | Common Stock of Tesla, Inc. (Nasdaq symbol: “TSLA”) |
| Payout Profile at Maturity |
· If the Ending Value is greater than or equal to 85.00% of the Starting Value, a return represented by the Step Up Payment · 1-to-1 downside exposure to decreases in the Market Measure beyond a 15.00% decline, with 85% of your principal at risk |
| Step Up Payment | [$3.00 to $3.60] per unit, which represents a return of [30.00% to 36.00%] of the principal amount, to be determined on the pricing date |
| Threshold Value | 85.00% of the Starting Value |
| Preliminary Offering Documents | https://www.sec.gov/Archives/edgar/data/1000275/000095010325008076/dp230562_424b2-mlacb.htm |
| Exchange Listing | No |
You should read the relevant Preliminary Offering Documents before you invest. Click on the Preliminary Offering Documents hyperlink above or call your Financial Advisor for a hard copy.
Risk Factors
Please see the Preliminary Offering Documents for a description of certain risks related to this investment, including, but not limited to, the following:
| · | Depending on the performance of the Market Measure as measured shortly before the maturity date, your investment may result in a loss; there is no guaranteed return of principal. |
| · | Your return on the notes may be less than the yield you could earn by owning a conventional fixed or floating rate debt security of comparable maturity. |
| · | Payments on the notes are subject to our credit risk, and actual or perceived changes in our creditworthiness are expected to affect the value of the notes. |
| · | Your investment return is limited to the return represented by the Step Up Payment and may be less than a comparable investment directly in the Market Measure. |
| · | The initial estimated value of the notes is only an estimate, determined as of a particular point in time by reference to our and our affiliates’ pricing models. |
| · | The public offering price you pay for the notes will exceed the initial estimated value. |
| · | The initial estimated value does not represent a minimum or maximum price at which we, MLPF&S, BofAS or any of our affiliates would be willing to purchase your notes in any secondary market (if any exists) at any time. |
| · | A trading market is not expected to develop for the notes. |
| · | Our business, hedging and trading activities, and those of MLPF&S, BofAS and our respective affiliates (including trades in the Market Measure), and any hedging and trading activities we, MLPF&S, BofAS or our respective affiliates engage in for our clients’ accounts, may affect the market value and return of the notes and may create conflicts of interest with you. |
| · | There may be potential conflicts of interest involving the calculation agent, which is BofAS. |
| · | The Underlying Company will have no obligations relating to the notes, and none of us, MLPF&S or BofAS will perform any due diligence procedures with respect to the Underlying Company in connection with this offering. |
| · | You will have no rights of a holder of the Market Measure, and you will not be entitled to receive shares of the Market Measure or dividends or other distributions by the Underlying Company. |
| · | While we, MLPF&S, BofAS or our respective affiliates may from time to time own securities of the Underlying Company, we, MLPF&S, BofAS and our respective affiliates do not control the Underlying Company, and have not verified any disclosure made by the Underlying Company. |
| · | The Redemption Amount will not be adjusted for all corporate events that could affect the Market Measure. See “Description of the Notes—Anti-Dilution Adjustments” beginning on page PS-22 of product supplement STOCK SUN-1. |
| · | The U.S. federal income tax consequences of an investment in the notes are uncertain. |
Final terms will be set on the pricing date within the given range for the specified Market-Linked Investment. Please see the Preliminary Offering Documents for complete product disclosure, including related risks and tax disclosure.
The graph above and the table below reflect the hypothetical return on the notes, based on the terms contained in the table to the left (using the mid-point for any range(s)). The graph and table have been prepared for purposes of illustration only and do not take into account any tax consequences from investing in the notes.
| Hypothetical Percentage Change from the Starting Value to the Ending Value | Hypothetical Redemption Amount per Unit | Hypothetical Total Rate of Return on the Notes |
| -100.00% | $1.50 | -85.00% |
| -50.00% | $6.50 | -35.00% |
| -20.00% | $9.50 | -5.00% |
| -15.00%(1) | $13.30(2) | 33.00% |
| -10.00% | $13.30 | 33.00% |
| -6.00% | $13.30 | 33.00% |
| -3.00% | $13.30 | 33.00% |
| 0.00% | $13.30 | 33.00% |
| 3.00% | $13.30 | 33.00% |
| 3.30% | $13.30 | 33.00% |
| 5.00% | $13.30 | 33.00% |
| 10.00% | $13.30 | 33.00% |
| 20.00% | $13.30 | 33.00% |
| 50.00% | $13.30 | 33.00% |
| 100.00% | $13.30 | 33.00% |
| | | |
|
(1) This percentage change corresponds to the Threshold Value. (2) This amount represents the sum of the principal amount and the hypothetical Step Up Payment of $3.30. Your investment return is limited to the return represented by the Step Up Payment. | ||
| |
RBC has filed a registration statement (including a product supplement, a prospectus supplement and a prospectus) with the SEC for the offering to which this document relates. Before you invest, you should read those documents, and the other documents that RBC has filed with the SEC, for more complete information about RBC and this offering. You may get these documents without cost by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, RBC, any agent, or any dealer participating in this offering will arrange to send you these documents if you so request by calling toll-free 1-800-294-1322.
FAQ
What is the potential return on Royal Bank of Canada’s TSLA-linked notes?
How much downside protection do the RBC Market-Linked Notes provide?
Are the TSLA-linked notes guaranteed or principal-protected?
Will there be a secondary market for these RBC notes?
How does credit risk affect the value of RBC’s Market-Linked Notes?
What is the tax treatment of Royal Bank of Canada’s TSLA-linked notes?
