HSBC Vantage+
Index

The HSBC Vantage+ Index provides dynamic and diverse exposure to multiple asset classes. Utilizing the investment concept of Modern Portfolio Theory and the related investment principle of Efficient Frontier the index attempts to maximize investment returns for a given level of market risk. This excess return index dynamically allocates to a diversified combination of ETFs on US and Emerging Market Equities, Bonds, Real Assets and Inflation.



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HSBC Vantage+ Index

The Strategy

The HSBC Vantage+ Index is an excess return index that provides exposure to as many as 13 ETFs across 5 asset classes to construct the monthly reference portfolio. During the monthly rebalancing process, cash is only employed when a 5% volatility portfolio cannot be constructed.

Rebalancing and Momentum

Each month over 3 business days, the Index determines its ETF allocations to capture price performance momentum using 3-month and 6-month returns at a realized 5% volatility.

Smart Leverage

Over the course of a month, the Index dynamically reacts to changing market conditions on a daily basis. HSBC employs a volatility management system, targeting 6%, allowing for leverage up to 1.5x in periods of low volatility, and providing for reduced exposure in periods of market stress.



HSBC Vantage+ Index
Additional Information

Monthly Performance Report

Contains the latest performance and allocations of Vantage+ to help track your investment and/or monitor index.

Fact Card

A client meeting leave-behind or quick introduction to the Vantage+ Index, outlining the key drivers of performance.

Strategy Guide

For investors who are new to Vantage+ Index and vol control indices, this provides a plain English description of how the index works.

Methodology Guide

For Investors familiar with Vantage+ Index and vol control indices, this technical overview illustrates the key strategies and how Vantage+ is calculated.




The HSBC Vantage+ Index demonstrates steady returns based on backtesting. The monthly reallocation across assets, along with an intra-month 6% volatility cap, mitigates the effects of market volatility while increasing the opportunity for positive returns.

Vantage Plus historical performance

HSBC Vantage+
Performance



HSBC Vantage+ Performance
1 Year Return -1.62%
3 Year Return -12.04%
5 Year Return -10.04%
10 Year Return 20.48%
Annualized Volatility since inception 6.05%


Vantage plus comparison chart with other indices

Index Comparison


Certain key features of the HSBC Vantage+ Index have enabled it to achieve greater gains than some similar multi-asset indices for several years.



The graphs and table above set forth the hypothetical back-tested performance of the Index from January 2, 2013 through September 29, 2023. The Index has only been calculated by Solactive AG since November 8, 2019. The hypothetical back-tested performance of the Index set forth in the graph above was calculated using the selection criteria and methodology employed to calculate the Index since its inception on November 8, 2019. However, the hypothetical back-tested Index data only reflects the application of that methodology in hindsight. The hypothetical back-tested Index data cannot completely account for the impact of financial risk in actual trading. There are numerous factors related to the equities, bonds, real estate and commodities markets in general that cannot be, and have not been, accounted for in the hypothetical back-tested Index data, all of which can affect actual performance. Consequently, you should not rely on that data as a reflection of what the actual Index performance would have been had the Index been in existence or in forecasting future Index performance. Any hypothetical upward or downward trend in the level of the Index during any period shown is not an indication that the level of the Index is more or less likely to increase or decrease at any time. Please see “Risks relating to the index” and “Important information” for more information about hypothetical back-tested performance data.
Click here for information regarding use of simulated returns

HSBC Vantage+ Index
Key Drivers of Performance

Prioritizing Performing Assets

The Index is constructed to maximize exposure to performing assets, across all Asset Classes and Assets. Cash is only employed when the index is unable to achieve its monthly and daily target volatilities.

Volatility Management System

Once the monthly allocations are determined, the Index applies leverage, or cash if needed, to target 6% volatility on a daily basis. In low volatility environments, the Index can leverage up to 1.5x times to increase exposure to the performing assets, while also providing for reduced exposure in times of market stress.

Higher Equity Allocation

The HSBC Vantage+ Index provides a greater maximum allocation to developed and emerging market equities compared to other similar volatility target indexes, which may increase the potential for index outperformance.


HSBC Vantage+ Index
Historical & Hypothetical Weightings


The HSBC Vantage+ Index is designed to dynamically adapt to different market conditions. Monthly reallocation of the Index components enables the HBSC Vantage+ Index to adapt to changes in the market, while the daily volatility management system seeks to reduce downside risk.

Average Annual Asset Class Allocation


Vantage+ Target Variance Weight Construction

Average Leverage to Monthly Portfolio


The charts above set forth the hypothetical Index Constituents allocation within Monthly Reference Portfolios (as defined herein) form January 2012 to September 2022. The Index has only been calculated by Solactive AG since November 8, 2019. The hypothetical back-tested performance of the Index set forth in the graphs above was calculated using the selection criteria and methodology employed to calculate the Index since its inception on November 8, 2019. However, the hypothetical back-tested Index Constituents allocation within Monthly Reference Portfolios only reflects the application of that selection methodology in hindsight, since the Index is not actually calculated and published. Please see “Risks relating to the index” and “Important information” for more information about hypothetical back-tested performance data.
Click here for information regarding use of simulated returns


Summary Description
Index Owner HSBC Bank PLC
Currency USD
Volatility Target 6%
Bloomberg Ticker HSIEVPLS
Index Composition Up to 13 ETFs plus Cash
Calculation Agent/Administrator Solactive AG

 

HSBC Vantage+ Index

 

The HSBC Vantage+ Index is an Excess Return index and reflects the weighted performance of the basket of Assets. The Index also incorporates a fee of 0.85% per annum, deducted daily.



Index Administrator / Index Calculation Agent

Solactive AG has been selected as the Calculation Agent and Index Administrator for the HSBC Vantage+ Index. Known for innovation and maintaining the highest standards, Solactive was a natural choice for partner for Vantage+.

As Calculation Agent and Index Administrator, Solactive AG will be responsible for the following:
  • The integrity of the historical data
  • Ensuring consistency in the Index methodology and calculation
  • Dissemination of Index information and performance
  • Independently managing corporate actions in an unbiased and fair manner

Calculation Agent
The Calculation Agent is responsible for the day-to-day implementation of the Index Methodology, and for the calculation of the Index.

Index Administrator
The Index Administrator is responsible for overseeing the Index and the Index Methodology, including the selection of any successor components and managing market disruptions.







Next Steps


Investments in the HSBC Vantage+ Index are available through HSBC Structured Products. Contact your Financial Professional about what HSBC Vantage+ investments might help you achieve your financial goals.


Financial Advisors can view the current HSBC offerings linked to the Vantage+ index by clicking here

Financial Advisors not yet registered with HSBC, can register here.



© Copyright. HSBC Bank plc 2021. All rights reserved.
Any information relating to performance contained in this document is illustrative only. No assurance is given that any indicative returns, performance or results, whether historical or hypothetical, will be achieved. Any specific terms or methodology remains subject to change, and HSBC undertakes no duty to update this information. This document may be amended, superseded or replaced in its entirety by a subsequent term sheet, disclosure or prospectus supplement, and/or offering circular or similar document and the documents referred to therein. In the event of any inconsistency between the information presented herein and any such term sheet, disclosure or prospectus supplement, and/or offering circular or similar document, such term sheet, disclosure or prospectus supplement, and/or offering circular or similar document shall govern.

Investing in financial instruments linked to the HSBC Vantage+ Index (the "Index") is not equivalent to a direct investment in the Index or any exchange-traded fund that forms a part of the Index. Investments linked to the Index require investors to assess several characteristics and risk factors that may not be present in other types of transactions. In reaching a determination as to the appropriateness of any proposed transaction, clients should undertake a thorough independent review of the legal, regulatory, credit, tax, accounting and economic consequences of such transaction in relation to their particular circumstances. This document market data from various sources other than us and our affiliates, and, accordingly, we make no representation or warranty as to the market data's accuracy or completeness. All information is subject to change without notice. We or our affiliated companies may make a market or deal as principal in the investments mentioned in this document or in options, futures or other derivatives based thereon.

HSBC has filed a registration statement (including a prospectus and prospectus supplement) with the Securities and Exchange Commission for any offering to which this free writing prospectus may relate. Before you invest, you should read the prospectus and prospectus supplement in that registration statement and other documents HSBC has filed with the SEC for more complete information about HSBC and any related offering. You may get these documents for free by visiting EDGAR on the SEC's web site at www.sec.gov. Alternatively, HSBC Securities (USA) Inc. or any dealer participating in the related offering will arrange to send you the prospectus and prospectus supplement if you request them by calling toll-free 1-866-8118049.

Solactive AG
Solactive AG ("Solactive AG") is the administrator and calculation agent of the Index. The financial instruments that are based on the Index are not sponsored, endorsed, promoted or sold by Solactive AG in any way and Solactive AG makes no express or implied representation, guarantee or assurance with regard to: (a) the advisability in investing in the financial instruments; (b) the quality, accuracy and/or completeness of the Index; and/or (c) the results obtained or to be obtained by any person or entity from the use of the Index. Solactive AG does not guarantee the accuracy and/or the completeness of the Index and shall not have any liability for any errors or omissions with respect thereto. Solactive AG reserves the right to change the methods of calculation or publication and Solactive AG shall not be liable for any miscalculation of or any incorrect, delayed or interrupted publication with respect to the Index. Solactive AG shall not be liable for any damages, including, without limitation, any loss of profits or business, or any special, incidental, punitive, indirect or consequential damages suffered or incurred as a result of the use (or inability to use) of the Index.

Use of simulated returns
Any performance information included in this document prior to November 8, 2019 represents only hypothetical historical results. You should note that the Index constituents have not traded together in the manner shown in the composite hypothetical historical results. No representation is being made that the Index will achieve a performance record similar to that shown. In fact, there may often be sharp differences between hypothetical performance and actual performance. In addition, because certain of the Index Constituents (SPLV, HYG, EEM, EMB, GLD and TIP) were not in existence at the start of the backtested period, adjustments have been made to calculate their performance prior to their inception.

Back-testing and other statistical analysis material provided to you in connection with the explanations of the potential returns associated with an investment linked to the Index use simulated analysis and hypothetical assumptions in order to illustrate the manner in which the Index may have performed in periods prior to the actual existence of the Index. The hypothetical back-tested annualized performance and annualized volatility of the Index have inherent limitations. These performance and volatility results were achieved by means of a retroactive application of a back-tested volatility model designed with the benefit of hindsight. All hypothetical levels shown have inherent limitations. Alternative modelling techniques or assumptions may produce different hypothetical information that might prove to be more appropriate and that might differ significantly from the hypothetical information set forth above. Actual annualized performance and volatilities may vary materially from the information shown.

As of July 15, 2022, the Index Calculation Agent changed the cash element of the Index from 3-month U.S. dollar LIBOR to daily SOFR plus a spread of 0.26161%. Consequently, any hypothetical historical and historical presentation of the performance of the Index in this document represents a different cash element prior to July 15, 2022.

The results obtained from "back-testing" information should not be considered indicative of actual results that might be obtained from an investment or participation in a financial instrument or transaction referencing the Index. You should not place undue reliance on the "back-testing" information, which is provided for illustrative purposes only. HSBC provides no assurance or guarantee that the Index will operate or would have operated in the past in a manner consistent with the results presented in this website.

Hypothetical back-tested results are neither an indicator nor a guarantee of future returns. Actual results will vary, perhaps materially, from the analysis implied in the hypothetical information. You should review and consider the hypothetical information only with the full Index methodology.

The Index is the exclusive property of HSBC Bank plc and its affiliates which has contracted with Solactive AG to administer, maintain and calculate the Index. The Index is not endorsed by Solactive AG or its affiliates or its third party licensors. "Calculated by Solactive AG" and its related stylized mark(s) are service marks of Solactive AG and have been licensed for use by HSBC Bank plc and its affiliates. Solactive AG shall have no liability for any errors or omissions in calculating the Index.

The Index is proprietary to HSBC Bank plc. No use or publication may be made of the Index, or any of its provisions or values, without the prior written consent of HSBC Bank plc. Neither HSBC Bank plc nor its duly appointed successor, acting as index owner (the "Index Owner"), nor Solactive AG or its duly appointed successor, acting as index administrator ("Index Administrator") and index calculation agent ("Index Calculation Agent"), are obliged to enter into or promote transactions or investments that are linked to the Index.

The Index Owner, the Index Administrator and the Index Calculation Agent do not assume any obligation or duty to any party and under no circumstances does the Index Owner, the Index Administrator or the Index Calculation Agent assume any relationship of agency or trust or of a fiduciary nature for or with any party. Any calculations or determinations in respect of the Index or any part thereof shall, unless otherwise specified, be made by the Index Calculation Agent, acting in good faith and in a commercially reasonable manner and shall (save in the case of manifest error) be final, conclusive and binding. The term "manifest error" as used herein shall mean an error that is plain and obvious and can be identified from the results of the calculation or determination itself without recourse to any underlying data.

The Index Owner makes no express or implied representations or warranties as to (a) the advisability of purchasing or assuming any risk in connection with any transaction or investment linked to the Index, (b) the levels at which the Index stands at any particular time on any particular date, (c) the results to be obtained by any party from the use of the Index or any data included in it for the purposes of issuing any financial instruments or carrying out any financial transaction linked to the Index or (d) any other matter. Calculations may be based on information obtained from various publicly available sources. The Index Administrator and the Index Calculation Agent have relied on these sources and have not independently verified the information extracted from these sources and accept no responsibility or liability in respect thereof.

Without prejudice to the foregoing, in no event shall the Index Owner, the Index Administrator nor the Index Calculation Agent, have any liability for any indirect, special, punitive or consequential damages (provided that any such damage is not reasonably foreseeable) even if notified of the possibility of such damages.