HSBC 4 Year USD Commodity Basket Linked Deposit Notes

Matured Price*: 114.70%
Maturity Date: 29 March 2010

The Notes will pay, if held to maturity: i) 100 per cent of the principal amount invested; and ii) a variable return, if any, that is based on 130 per cent of the positive performance of an equally weighted basket of commodities which include crude oil, natural gas, aluminium, copper and nickel.

Key features

Issue date: 29 March 2006
Maturity date: 29 March 2010
Note Term: 4 years
CUSIP #: 40427HKM4
Currency: USD
Participation 130%
Selling agent fees: 3% paid upfront

Highlights

  • Eligible for registered accounts
  • Principal protected at maturity
  • 130 per cent participation

Underlying asset(s)

Notional commodity basket
Commodity Weight
Crude Oil 20%
Natural Gas 20%
Copper 20%
Copper 20%
Nickel 20%

Are the Notes right for you?

The Notes may be an appropriate investment for you, if, among other things, you: (1) are looking for safety of principal if held to maturity; (2) want exposure to an investment that is linked to the performance of a basket of commodities which include crude oil, natural gas, aluminium, copper and nickel; and (3) are investing for the longer term.

The Notes do not provide investors with a return or income stream prior to maturity. The effective yield to maturity of the Notes may be less than that which would be payable on a conventional fixed-rate or floating-rate debt instrument. The Notes are generally more suitable for purchasing and holding up to maturity. Potential investors should consult with their own investment, legal and tax advisors to determine the suitability.

Early trading charges/Secondary market

HSBC Securities (Canada) Inc intends, in normal market conditions, but is under no obligation, to use reasonable efforts to provide a secondary price for the Notes as principal, but reserves the right not to do so in the future at its sole discretion, without providing prior notice to the Noteholders. Sale of Notes prior to maturity may be subject to an early trading charge as follows:

Year 1 2 3 <
Charge 3% 2% 0%

Please see the Term sheet for further details or contact your investment advisor.

Risk factors

Noteholders should carefully review and consider all risks set forth in the Term sheet with their investment advisor, including:

  • The volatility or degree to which the level of the index changes
  • Risks that the general level of commodity prices may decline; influence of political, economic financial, market and other factors on the commodity basket
  • Notes will not constitute insured deposits under the Canada Deposit Insurance Corporation Act
  • The principal amount is protected only if Notes are held to maturity
  • Noteholders may receive no variable return
  • No guaranteed secondary market
  • The historical, or pro forma, performance of each index is not an indication of future performance
  • Extraordinary events - HSBC may redeem the Notes prior to maturity upon the occurrence of certain extraordinary events, which include events that could have an impact on HSBC's ability to perform its obligations under the Notes, or to hedge its position in respect of its obligation to make payments under the Notes
  • Conflicts of interest with the Calculation Agent

Additional information

Amendments to Notes - The global deposit note filed on CDS representing the Notes may from time to time be amended, supplemented or restated by HSBC without the approval of the Noteholders for the following purposes: (i) ensuring or continuing compliance with applicable laws, regulations, rules or requirements of any governmental authority having jurisdiction over HSBC, (ii) changing the dates on which payments are required to be made to conform with customary settlement practices, (iii) making any modification that would not be prejudicial to the interests of Noteholders in the opinion of HSBC, (iv) making changes or corrections which are necessary or desirable for the correction of typographical mistakes, or are required for the purpose of curing any ambiguity, defective or inconsistent provisions, omissions or errors.

Please see the Information Statement for further details. Please do not hesitate to call us at +1 866 511 4722 or send us an
e-mail for more information.

*The price is before the application of an early trade charge that may apply. The secondary market price for a Note, if available, represents the bid price of such Note as a percentage (%) of the original principal amount invested. The bid price stated is only as of the date indicated.

Important: Please read the disclaimer carefully.