Royal Bank of Canada filed a free writing prospectus on November 3, 2026, disclosing terms for Auto-Callable Enhanced Return Barrier Notes linked to a basket of five semiconductor and technology equity securities, with a maturity date of December 5, 2029.

Key Highlights

  • Issuer and CUSIP: Royal Bank of Canada (NYSE:RY) is the issuer; CUSIP 78018DQU4.
  • Basket composition: Five equally weighted securities: AMD, Broadcom (AVGO), NVIDIA (NVDA), QUALCOMM (QCOM), and Taiwan Semiconductor Manufacturing Company ADRs (TSM), each at 1/5 weighting.
  • Auto-call feature: If the basket closing value on December 6, 2027 equals or exceeds the Initial Basket Value of 100, investors receive at least $1,175 per $1,000 principal (at least 117.50%).
  • Enhanced return at maturity: If not called and the Final Basket Value exceeds the Initial Basket Value, investors receive 150% of the Basket Return added to principal.
  • Barrier level: Set at 70, which is 70% of the Initial Basket Value; principal is returned in full if the Final Basket Value falls between 70 and 100.
  • Principal risk: If the Final Basket Value falls below 70 at maturity, investors lose 1% of principal for each 1% the Final Basket Value is below the Initial Basket Value.
  • Initial estimated value: Expected to be between $900.00 and $950.00 per $1,000 principal amount, less than the public offering price.

Structure and Payout Terms of the RBC Semiconductor Basket Notes

According to the filing, the notes are structured around a single Call Observation Date of December 6, 2027. If the basket's closing value on that date is at or above the Initial Basket Value of 100, the notes are automatically called and investors receive at least $1,175 per $1,000 principal on the Call Settlement Date of December 9, 2027, with no further payments made. The minimum call premium of at least 17.50% is to be confirmed on the Trade Date of November 30, 2026.

If the notes are not called, the payout at the December 5, 2029 maturity depends on the Final Basket Value as measured on the Valuation Date of November 30, 2029. The filing states that a 150% Participation Rate applies when the Final Basket Value exceeds the Initial Basket Value. If the Final Basket Value is at or below 100 but at or above the Barrier Value of 70, investors receive their $1,000 principal back in full. Below the Barrier Value, the notes provide no downside protection, and the filing warns that investors "will lose a substantial portion or all of your principal amount at maturity."

The filing discloses that the notes do not pay periodic interest and that the initial estimated value will be less than the public offering price. Royal Bank of Canada Capital Markets (RBCCM) acts as calculation agent, and the filing notes that this role "may create conflicts of interest." Additional risks cited include credit risk tied to Royal Bank of Canada, limited secondary market liquidity, currency exchange risk specific to the TSM American depositary share underlier, and uncertainty regarding U.S. federal income tax treatment. The filing was made pursuant to Rule 433 under Registration Statement No. 333-275898.

What Was Disclosed

Royal Bank of Canada filed free writing prospectus terms for Auto-Callable Enhanced Return Barrier Notes due December 5, 2029, linked equally to AMD, Broadcom, NVIDIA, QUALCOMM, and Taiwan Semiconductor ADRs, with CUSIP 78018DQU4 and an estimated value between $900.00 and $950.00 per $1,000 note.