Morgan Stanley Finance LLC Issues $2 Million Jump Securities Linked to Broadcom and NVIDIA Stock Performance

Structure and Pricing of the Structured Notes Offering

Morgan Stanley Finance LLC structured and priced the Jump Securities offering on July 23, 2026, with an original issue date of July 28, 2026. The aggregate principal amount issued was $2,000,000, with each security carrying a stated principal amount of $1,000. The issue price was $1,000 per security, though the estimated value on the pricing date was $973.80 per security, reflecting embedded costs associated with issuance, sales, structuring, and hedging. The disclosure notes that the difference between the issue price and estimated value represents costs borne by investors at the time of purchase.

Morgan Stanley & Co. LLC, an affiliate of Morgan Stanley Finance LLC and a wholly owned subsidiary of Morgan Stanley, served as the agent for the offering. J.P. Morgan Securities LLC and JPMorgan Chase Bank, N.A. acted as placement agents, with total commissions and fees of $30,000 (representing $15 per $1,000 of stated principal amount) and net proceeds to the issuer of $1,970,000. The filing indicates that placement agents would forgo fees for sales to certain fiduciary accounts, with the stated $15-per-$1,000 figure representing fees from non-fiduciary accounts only.

Dual Underlier Structure Based on Broadcom and NVIDIA Performance

The securities are linked to the performance of two common stocks: Broadcom Inc. (AVGO) and NVIDIA Corporation (NVDA). Both underliers were struck on July 22, 2026, with Broadcom at an initial level of $396.81 and NVIDIA at an initial level of $212.06. The filing emphasizes that the securities' value depends on the worst-performing of the two stocks, meaning that gains in one underlier do not offset losses in the other. This structure creates a meaningful asymmetry for investors, as deterioration in either stock beyond specific thresholds triggers proportional losses in security value.

The filing explicitly states that the use of multiple underliers provides no asset diversification benefits. Instead, it concentrates risk on whichever stock performs most poorly relative to its initial level. Investors are cautioned that a significant decline in either Broadcom or NVIDIA stock will adversely affect returns on the securities, regardless of whether the other underlier has appreciated or remained relatively stable. This worst-of-two-underliers design is central to the risk profile of these principal-at-risk securities.

Early Redemption Feature and Call Threshold Mechanics

The securities incorporate an automatic early redemption feature with the potential for substantial upside if specific market conditions are met. On the first determination date of August 5, 2027, the securities will be automatically redeemed if the closing level of each underlier is at or above its call threshold level. For Broadcom, the call threshold is $396.81 (100% of its initial level), and for NVIDIA, the call threshold is $212.06 (100% of its initial level). If both underliers close at or above these levels on that date, the securities will be redeemed on the early redemption date of August 9, 2027.

Upon early redemption, investors will receive an early redemption payment of $1,500 per security, representing a 50% premium above the stated principal amount of $1,000. The filing notes that once securities are automatically redeemed, no further payments will be made. This early redemption feature is conditional on both underliers maintaining their strike-date prices or appreciating from those levels within the roughly 13-month period from July 22, 2026, to August 5, 2027. For investors who purchased at $1,000 per security with an estimated value of $973.80, a $1,500 early redemption payment would generate substantial returns if the feature is triggered.

Principal Repayment at Maturity Under Three Performance Scenarios

The filing describes three distinct outcomes possible at maturity on July 27, 2028, depending on the final levels of both underliers. If the final level of each underlier is greater than its initial level, investors receive the stated principal amount of $1,000 plus an upside payment. The upside payment is calculated as the stated principal amount multiplied by the participation rate of 300% multiplied by the underlier percent change of the worst-performing underlier. This means if the worst-performing stock appreciates 10%, the upside payment would be $1,000 × 3.00 × 0.10 = $300, for a total payment of $1,300 per security.

If the final level of either underlier is equal to or less than its initial level but both underliers remain at or above their downside threshold levels (60% of initial levels), investors receive only the stated principal amount of $1,000 with no upside participation. However, if the final level of either underlier falls below its downside threshold level, investors lose 1% for every 1% decline in the worst-performing underlier below the initial level. The filing explicitly warns that under these circumstances, the payment at maturity will be significantly less than the stated principal amount and could be zero. For Broadcom, the downside threshold is $238.086 (60% of $396.81), and for NVIDIA, the downside threshold is $127.236 (60% of $212.06).

Full Principal Loss Risk if Worst-Performing Stock Declines Significantly

The securities present substantial downside risk that distinguishes them from conventional debt instruments. If the worst-performing underlier declines more than 40% from its strike-date level, investors will experience losses exceeding the principal amount they invested. The performance factor mechanism means that if the worst-performing stock falls to 50% of its initial level, for example, investors would receive only 50% of their principal back. If either underlier falls to zero or near-zero values, the payment at maturity could approach zero dollars per security.

The filing repeatedly emphasizes that these are principal-at-risk securities designed only for investors willing to accept the possibility of losing their entire initial investment. The disclosure states: "Investors in the securities must be willing to accept the risk of losing their entire initial investment based on the performance of either underlier." This language underscores the fundamental nature of these instruments as speculative investments rather than capital-preservation vehicles. The securities do not guarantee the repayment of principal and do not provide for the regular payment of interest, further distinguishing them from traditional bonds or notes.

Credit Risk and Guarantee Structure

The securities are unsecured obligations of Morgan Stanley Finance LLC and are fully and unconditionally guaranteed by Morgan Stanley. The filing discloses that all payments are subject to the credit risk of Morgan Stanley and Morgan Stanley Finance LLC. In the event of a default by either entity, investors could lose some or all of their investment. The guarantee by Morgan Stanley provides recourse only to the parent company and does not create any security interest in underlying reference assets or provide access to collateral.

The securities are not secured obligations, meaning investors have no priority claim to specific assets in the event of default or insolvency. The filing explicitly states: "These securities are not secured obligations and you will not have any security interest in, or otherwise have any access to, any underlying reference asset or assets." This underscores that investor recovery depends entirely on the creditworthiness of Morgan Stanley and Morgan Stanley Finance LLC, independent of the performance of Broadcom or NVIDIA stock. Investors bear both market risk (tied to stock performance) and credit risk (tied to Morgan Stanley's ability to meet obligations).

Investor Suitability Profile and Risk Acknowledgment

The filing characterizes the securities as appropriate only for investors meeting specific risk tolerance and investment objective criteria. According to the disclosure, the securities are "for investors who are willing to risk their principal and forgo current income in exchange for the possibility of receiving an early redemption payment or payment at maturity that exceeds the stated principal amount." This language acknowledges that investors must sacrifice current income (no interest payments) and accept principal risk in pursuit of potential capital appreciation from the upside payment and early redemption feature.

The offering documents included with this pricing supplement—the product supplement dated April 8, 2026, the tax supplement dated April 8, 2026, and the prospectus dated April 8, 2026—provide additional detail on risk factors and other terms. The filing notes that investors should read the pricing supplement together with these related documents, though the specific risk factor disclosures are referenced rather than reproduced in full in the filing itself.

Regulatory Status and FDIC Coverage Exclusion

The offering was filed pursuant to Rule 424(b)(2) under the Securities Act, referencing registration statement numbers 333-293641 and 333-293641-01. The securities received a pricing date of July 23, 2026, and were filed with the SEC on July 27, 2026. The Securities and Exchange Commission and state securities regulators have not approved or disapproved the securities, nor have they determined whether the pricing supplement and accompanying product supplement, tax supplement, and prospectus are truthful or complete, according to standard regulatory language in the filing.

The filing includes explicit notice that the securities are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency or instrumentality, nor are they obligations of, or guaranteed by, a bank. This disclaimer clarifies that despite being issued by Morgan Stanley Finance LLC (a subsidiary of a bank holding company), these instruments fall outside deposit insurance protections and regulatory safeguards that apply to traditional bank deposits. The absence of FDIC coverage reinforces the principal-at-risk nature of the investment.

Terms, Identification, and Distribution Restrictions

The securities carry a CUSIP number of 61781GX63 and an ISIN of US61781GX638 for identification and settlement purposes. The filing indicates that the securities will not be listed on any securities exchange, meaning they will trade only in over-the-counter markets and are less liquid than exchange-traded securities. The securities are issued as part of Morgan Stanley Finance LLC's Series A Global Medium-Term Notes program, a framework under which the issuer can issue various structured debt instruments with different terms and underliers.

The maturity date is fixed at July 27, 2028, with a final determination date of July 24, 2028 (subject to postponement for non-trading days and market disruption events). The strike date was July 22, 2026, establishing the reference prices for both Broadcom and NVIDIA stock that determine all subsequent calculations of performance, thresholds, and payoffs. The filing specifies that closing levels and adjustment factors are defined in the product supplement, indicating that additional operational and definitional details are contained in the accompanying documentation beyond what the pricing supplement itself discloses.