Royal Bank of Canada filed a free writing prospectus on October 30, 2026, disclosing preliminary terms for Autocallable Strategic Accelerated Redemption Securities linked to a basket of three stocks: General Electric Company, Quanta Services, Inc., and Vistra Corp.

Key Highlights

  • Issuer: Royal Bank of Canada ("RBC"), filed under Registration Statement No. 333-275898 pursuant to Rule 433.
  • Principal amount: $10.00 per unit, with a term of approximately 3 years if not called earlier.
  • Basket composition: An approximately equally weighted basket of common stocks of General Electric Company (NYSE: "GE"), Quanta Services, Inc. (NYSE: "PWR"), and Vistra Corp. (NYSE: "VST").
  • Automatic call trigger: Notes are called automatically if the Observation Level of the basket on any Observation Date is equal to or greater than the Starting Value.
  • Preliminary call amounts per unit: [$11.50 to $11.60] if called on the first Observation Date, [$13.00 to $13.20] on the second, and [$14.50 to $14.80] on the final Observation Date, with final amounts to be set on the pricing date.
  • Downside risk: If not called, the notes carry 1-to-1 downside exposure to decreases in the basket value, with 100% of principal at risk.
  • No exchange listing: The filing states the notes will not be listed on any exchange, and a trading market is not expected to develop.

RBC Preliminary STARS Terms: Basket Structure, Call Mechanics, and Key Risks

According to the filing, the notes are structured as Autocallable Strategic Accelerated Redemption Securities (STARS), a registered trademark of RBC. The basket underlying the securities is described as "approximately equally weighted" and consists of the common stocks of three companies: General Electric Company (NYSE symbol: "GE"), Quanta Services, Inc. (NYSE symbol: "PWR"), and Vistra Corp. (NYSE symbol: "VST"). Observation Dates are set at approximately one, two, and three years after the pricing date.

The filing discloses that if the basket's Observation Level on any Observation Date equals or exceeds the Starting Value, an automatic call is triggered and investors receive the applicable Call Amount. Final call amounts will be determined on the pricing date within the ranges provided. The Threshold Value is set at 100% of the Starting Value. If the notes are not called at any Observation Date, investors face full 1-to-1 downside exposure to any decline in the basket, with no guaranteed return of principal.

The filing lists several risk factors, including that payments are subject to RBC's credit risk, that the public offering price will exceed the initial estimated value, and that the initial estimated value "does not represent a minimum or maximum price" at which the notes could be purchased in any secondary market. The filing also notes that "the Underlying Companies will have no obligations relating to the notes," and that investors "will have no rights of a holder of the Basket Stocks" and will not receive dividends or other distributions. The U.S. federal income tax consequences are described as "uncertain."

What Was Disclosed

RBC filed a free writing prospectus setting out preliminary terms for autocallable structured notes linked to a three-stock basket of GE, PWR, and VST, with principal of $10.00 per unit, conditional call payouts, and full downside exposure if not called.