Accelerated Return Notes® (ARNs®)
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Issuer
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Royal Bank of Canada (“RBC”)
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Principal Amount
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$10.00 per unit
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Term
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Approximately 14 months
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Market Measure
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An approximately equally weighted basket of three financial sector stocks comprised of the common stocks of each of The Goldman Sachs Group, Inc. (NYSE symbol: “GS”), JPMorgan Chase & Co. (NYSE symbol:
“JPM”) and Morgan Stanley (NYSE symbol: “MS”) (each, a “Basket Stock”).
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Payout Profile at
Maturity
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• 3-to-1 upside exposure to increases in the Market
Measure, subject to the Capped Value
• 1-to-1 downside exposure to decreases in the Market
Measure, with up to 100% of your investment at risk
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Capped Value
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[$11.80 to $12.20] per unit, a [18.00% to 22.00%] return over the principal amount, to be determined on the pricing date.
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Investment Considerations
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This investment is designed for investors who anticipate that the Market Measure will increase moderately over the term of the notes, and are willing to accept a capped return, take full downside risk and
forgo interim interest payments.
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Preliminary
Offering
Documents
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Exchange Listing
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No
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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.
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Payments on the notes, including repayment of principal, are subject to the credit risk of RBC. If RBC becomes insolvent or is unable to pay its obligations, you may lose your entire investment.
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Your investment return is limited to the return represented by the Capped Value and may be less than a comparable investment directly in the Basket Stocks.
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Changes in the price of one of the Basket Stocks may be offset by changes in the prices of the other Basket Stocks.
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The initial estimated value of the notes on the pricing date will be less than their public offering price.
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If you attempt to sell the notes prior to maturity, their market value may be lower than both the public offering price and the initial estimated value of the notes on the pricing date.
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You will have no rights of a holder of the Basket Stocks, and you will not be entitled to receive any shares of the Basket Stocks or dividends or other distributions by the issuers of the Basket Stocks.
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The issuer, BofAS and their respective affiliates do not control any company included in the Basket and have not verified any disclosure made by any other company. The companies included in the Basket will
have no obligations relating to the notes.
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The Redemption Amount will not be adjusted for all corporate events that could affect the Basket Stocks.
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The Basket is concentrated in the financial sector, and an investment in the notes involves certain risks associated with an investment in companies in the financial sector.
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Hypothetical
Percentage Change
from the Starting Value
to the Ending Value
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Hypothetical
Redemption Amount
per Unit
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Hypothetical Total Rate of Return on the Notes
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-100.00%
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$0.00
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-100.00%
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-50.00%
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$5.00
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-50.00%
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-20.00%
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$8.00
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-20.00%
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-10.00%
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$9.00
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-10.00%
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-6.00%
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$9.40
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-6.00%
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-3.00%
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$9.70
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-3.00%
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0.00%
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$10.00
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0.00%
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2.00%
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$10.60
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6.00%
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5.00%
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$11.50
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15.00%
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6.67%
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$12.00(1)
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20.00%
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10.00%
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$12.00
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20.00%
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15.00%
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$12.00
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20.00%
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20.00%
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$12.00
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20.00%
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30.00%
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$12.00
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20.00%
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40.00%
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$12.00
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20.00%
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50.00%
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$12.00
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20.00%
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60.00%
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$12.00
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20.00%
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(1)
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The Redemption Amount per unit cannot exceed the hypothetical Capped Value.
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