Free Writing Prospectus to Preliminary Pricing Supplement No. 5,889
Registration Statement Nos. 333-275587; 333-275587-01
Dated January 14, 2025; Filed pursuant to Rule 433
Morgan Stanley
5-Year Worst-of SPX, XLU and XLE Enhanced Trigger Jump Securities
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 | ||
Issuing entity: | Morgan Stanley Finance LLC | |
Guarantor: | Morgan Stanley | |
Underlyings: | S&P 500® Index (SPX), Utilities Select Sector SPDR® Fund (XLU) and the Energy Select Sector SPDR® Fund (XLE) | |
Upside payment: | At least 70.50% of the stated principal amount | |
Digital threshold value: | 80% of the initial level for such underlying | |
Downside threshold value: | 70% of the initial level for such underlying | |
Pricing date: | January 24, 2025 | |
Valuation date: | January 24, 2030 | |
Maturity date: | January 29, 2030 | |
CUSIP: | 61777R4Q3 | |
Preliminary pricing supplement: | https://www.sec.gov/Archives/edgar/data/895421/000183988225001699/ms5889_424b2-00867.htm | |
1All payments are subject to our credit risk
Hypothetical Payout at Maturity1 The payment at maturity will be based solely on the performance of the worst performing underlying, which could be any underlying. The graph and table below illustrate the payment at maturity depending on the performance of the worst performing underlying.
| |
Change in Worst Performing Underlying | Return on Securities |
+90.00% | 90.00% |
+80.00% | 80.00% |
+71.00% | 71.00% |
+70.50% | 70.50% |
+60.00% | 70.50%* |
+40.00% | 70.50%* |
+20.00% | 70.50%* |
+10.00% | 70.50%* |
0.00% | 70.50%* |
-10.00% | 70.50%* |
-20.00% | 70.50%* |
-21.00% | 0.00% |
-30.00% | 0.00% |
-31.00% | -31.00% |
-40.00% | -40.00% |
-50.00% | -50.00% |
-60.00% | -60.00% |
*Assumes an upside payment of 70.50% of the stated principal amount | |
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.
Underlyings
For more information about the underlying, 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 pay interest or guarantee the return of any principal.
●The amount payable on the securities is not linked to the values of the underlyings at any time other than the valuation date.
●The securities will not be listed on any securities exchange and secondary trading may be limited.
●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 estimated value of the securities is approximately $927.40 per security, or within $55.00 of that estimate, and 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 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.
●Investing in the securities is not equivalent to investing in the underlyings or the stocks composing the SPX Index or the share underlying indices.
●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.
●The U.S. federal income tax consequences of an investment in the securities are uncertain.
Risks Relating to the Underlyings
●You are exposed to the price risk of each underlying.
●Because the securities are linked to the performance of the worst performing underlying, you are exposed to greater risk of sustaining a significant loss on your investment than if the securities were linked to just one underlying.
●Investing in the securities exposes investors to risks associated with investments in securities with a concentration in the utilities sector.
●Investing in the securities exposes investors to risks associated with investments with a concentration in the energy sector.
●Adjustments to the SPX Index could adversely affect the value of the securities.
●Adjustments to the XLU Shares and the XLE Shares or the share underlying indices could adversely affect the value of the securities.
●The antidilution adjustments the calculation agent is required to make do not cover every event that could affect the XLU Shares or the XLE Shares.
●The performance and market price of each of the XLU Shares and the XLE Shares, particularly during periods of market volatility, may not correlate with the performance of its respective share underlying index, the performance of the component securities of such share underlying index or the net asset value per share of such underlying shares.
Tax Considerations
You should review carefully the discussion in the accompanying preliminary pricing supplement under the caption “Additional Information About the Securities–Tax considerations” concerning the U.S. federal income tax consequences of an investment in the securities, and you should consult your tax adviser.