Retrospective: Morgan Stanley's Jump Securities

Morgan Stanley’s six-month Jump Securities made good on a performance that meant a 10% payout to investors, although did not produce returns superior to a direct investment in the underlying basket.

In June 2010, Morgan Stanley issued Jump Securities, a six-month digital product based on the performance of a basket consisting of the Eurostoxx 50 index and the iShares MSCI Emerging Markets Index Fund. The product was structured to pay a return of 10% if the level of the basket finished at or above its initial level. No downside protection was offered, so the investor could suffer losses on a 1:1 basis from the strike level of 100%.

The basket was weighted 40% in the Eurostoxx 50 Index and 60