Global Franchise Portfolio
Share Class :
 
MSFAX CUSIP: 61744J283
 
 
Overall Morningstar Rating
Global Franchise Portfolio
MSFAX CUSIP: 61744J283
Share Class :

Global Franchise Portfolio

SHARE CLASS :
MSFAX CUSIP: 61744J283
 
Overall Morningstar Rating
 
 
 
Investment Approach

The investment team believes that high-quality companies can generate superior returns over the long term. Such businesses are typically built on dominant market positions, underpinned by powerful, hard to replicate intangible assets that can generate high, unlevered returns on capital and strong free cash flows. Other characteristics are recurring revenue streams, pricing power, low capital intensity and the opportunity for organic growth.

 
 
Pricing & Performance

Performance data quoted represents past performance, which is no guarantee of future results, and current performance may be lower or higher than the figures shown. For the most recent month-end performance figures, please select the "month" timeframe or call 1-800-548-7786. Investment returns and principal value will fluctuate and fund shares, when redeemed, may be worth more or less than their original cost. For additional important information, please click here

As of 01/31/2018

As of 02/23/2018


Performance of $10,000 invested
Performance of $10,000 invested

    
Past performance is not indicative of future results.
 
 
Average Annual Total Returns As of 01/31/2018 As of 12/31/2017
1 YR 3 YRS 5 YRS 10 YRS Since Inception
MSFAX (%) 26.88 13.94 11.91 10.09 11.75
MSCI World Net Index (%) 25.83 11.83 11.68 6.42 7.18
Lipper Category Average (%) 32.00 12.48 11.73 7.02 --
Morningstar Category Average (%) 26.73 11.26 10.96 6.15 --
1 YR 3 YRS 5 YRS 10 YRS Since Inception
MSFAX (%) 25.85 12.29 12.18 8.96 11.54
MSCI World Net Index (%) 22.40 9.26 11.64 5.03 6.87
Lipper Category Average (%) 27.89 9.87 11.10 5.33 --
Morningstar Category Average (%) 23.61 8.89 10.76 4.80 --
2013 2014 2015 2016 2017
MSFAX (%) 19.71 4.82 6.50 5.64 25.85
MSCI World Net Index (%) 26.68 4.94 -0.87 7.51 22.40
Lipper Category Average (%) 24.92 2.79 2.90 1.84 27.89
Morningstar Category Average (%) 25.19 2.79 -1.69 5.54 23.61
 
Average Annual Total Returns
TIMEFRAME MSFAX USD (%) MSCI World Net Index (%) Lipper Category Average (%) Morningstar Category Average (%)
1 Yr 26.88 25.83 32.00 26.73
3 Yrs 13.94 11.83 12.48 11.26
5 Yrs 11.91 11.68 11.73 10.96
10 Yrs 10.09 6.42 7.02 6.15
Since Inception 11.75 7.18 -- --
TIMEFRAME MSFAX USD (%) MSCI World Net Index (%) Lipper Category Average (%) Morningstar Category Average (%)
1 Yr 25.85 22.40 27.89 23.61
3 Yrs 12.29 9.26 9.87 8.89
5 Yrs 12.18 11.64 11.10 10.76
10 Yrs 8.96 5.03 5.33 4.80
Since Inception 11.54 6.87 -- --
TIMEFRAME MSFAX USD (%) MSCI World Net Index (%) Lipper Category Average (%) Morningstar Category Average (%)
2013 19.71 26.68 24.92 25.19
2014 4.82 4.94 2.79 2.79
2015 6.50 -0.87 2.90 -1.69
2016 5.64 7.51 1.84 5.54
2017 25.85 22.40 27.89 23.61
Past performance is not indicative of future results. The Portfolio's calendar year returns do not include the deduction of any applicable sales charges.
 
 
Risk/Return StatisticsAs of 01/31/2018

TIMEFRAME:
    MSFAX Index
Active share (%) 93.66 --
Alpha (%) 2.10 --
Beta (vs. benchmark) 0.84 1.00
Information ratio 0.29 --
R squared 0.61 1.00
Sharpe ratio 1.19 1.08
Standard deviation (%) 11.32 10.58
Tracking error (%) 7.25 --
    MSFAX Index
Active share (%) 93.66 --
Alpha (%) 0.23 --
Beta (vs. benchmark) 0.91 1.00
Information ratio 0.04 --
R squared 0.68 1.00
Sharpe ratio 1.07 1.16
Standard deviation (%) 10.90 9.87
Tracking error (%) 6.20 --
Past performance is not indicative of future results.
 
 
Distributions
 
Record Date Ex-Date Payable Date Net Investment Income ($ per share) Long-Term Capital Gains ($ per share) Short-Term Capital Gains ($ per share) Total Capital Gains ($ per share)  
12/15/2017 12/18/2017 12/18/2017 0.236319 0.835000 0.054100 0.889100
07/06/2017 07/07/2017 07/07/2017 0.000000 0.030600 0.000000 0.030600
12/15/2016 12/16/2016 12/16/2016 0.270536 0.545600 0.001400 0.547000
07/01/2016 07/05/2016 07/05/2016 0.006062 0.086100 0.000000 0.086100
Ex-Date /<br />Payable Date Net Investment Income ($ per share) Total Capital Gains ($ per share)
12/18/2017 /
12/18/2017
0.236319 0.889100
07/07/2017 /
07/07/2017
0.000000 0.030600
12/16/2016 /
12/16/2016
0.270536 0.547000
07/05/2016 /
07/05/2016
0.006062 0.086100
 
 
Composition As of 12/31/2017
  Fund Index
Consumer Staples 41.65 9.04
Information Technology 30.29 16.76
Consumer Discretionary 10.80 12.26
Industrials 6.05 11.66
Health Care 5.49 11.76
Financials 2.43 18.10
Materials 0.84 5.25
Cash 2.41 --


Geography As of 12/31/2017
  Fund Index
United States 55.03 59.21
United Kingdom 25.97 6.63
France 8.48 3.97
Germany 4.39 3.66
Italy 1.64 0.87
Netherlands 1.23 1.33
Switzerland 0.82 2.99
Country weightings arise from our bottom-up fundamental analysis. The team seeks superior companies that are attractively valued regardless of country of domicile.


Holdings As of 01/31/2018
Fund Index
British American Tobacco Plc 8.03 0.37
Microsoft Corp 7.74 1.63
Accenture Plc 7.26 0.23
Unilever Plc 6.63 0.17
Reckitt Benckiser Plc 5.81 0.15
Visa Inc 4.80 0.53
Twenty-First Century Fox Inc 4.30 0.13
Zoetis Inc 4.07 0.09
Philip Morris Inc 3.91 0.39
SAP SE 3.89 0.26
Total 56.44 --

Complete holdings for Global Franchise Portfolio will be available on a quarterly basis 15 calendar days after the quarter-end to current shareholders who email client service at msimcs@morganstanley.com

Please note, prior to February 13, 2018, holdings and related composition data, shown as of December 31, 2017, were reflecting data as of January 2, 2018.  Holdings data for these periods are available upon request by emailing client service at msimcs@morganstanley.com.



Portfolio Characteristics As of 12/31/2017
Fund Index
Number of holdings 27 1,653
Price/earnings (NTM) 21.18 16.96
Turnover (%) 30 --
Portfolio turnover is sourced from the fund's current prospectus. View current prospectus for the as of date.
 
 
Investment Team
Head of International Equity Team
26 years industry experience
Managing Director
24 years industry experience
Executive Director
20 years industry experience
Executive Director
20 years industry experience
Executive Director
16 years industry experience
Executive Director
18 years industry experience
Executive Director
10 years industry experience
Executive Director
8 years industry experience
Vice President
11 years industry experience
 
Insights by International Equity Team
Global Equity Observer
The Bull-Bear Tug-of-War
Feb 13, 2018
Following February’s market turbulence, the International Equity Team considers the ongoing tug-of-war between bulls citing global growth and bears arguing monetary policy and politics.
Investment View
Q&A with Nic Sochovsky
Dec 29, 2015
Nic Sochovsky, a portfolio manager on the International Equity Team, discusses the team’s significant exposure to what they consider high-quality Consumer Staples.
 
 
Resources
Product Literature
 
 
Prospectus & Reports
SAI
 
 
 
 
 

Class A shares include maximum front-end sales charge of 5.50% (Alternatives), 5.25% (Equity) and 4.25% (Fixed Income).  Class B shares include deferred sales charge of 5.00% which declines to zero after sixth year.  Class C shares include deferred sales charge of 1.00% which declines to zero after first year. Class L shares, Class I, and Class IS shares are not subject to a sales charge.

Where the net expense ratio is lower than the gross expense ratio, certain fees have been waived and/ or expenses reimbursed. These waivers and/or reimbursements will continue for at least one year from the date of the applicable fund’s current prospectus (unless otherwise noted in the applicable prospectus) or until such time as the fund's Board of Directors acts to discontinue all or a portion of such waivers and/or reimbursements. Absent such waivers and/or reimbursements, returns would have been lower. Expenses are based on the fund's current prospectus. The minimum initial investment is $5,000,000 for Class I shares.

The Fund has suspended offering Class L shares of the Portfolio for sale to all investors.

Class IS shares, are being offered only to eligible investors who must meet a minimum initial investment of $10,000,000 or be a defined contribution, defined benefit or other employer sponsored employee benefit plan, whether or not qualified under the Internal Revenue Code of 1986, as amended (the "Code"), in each case subject to the discretion of the Portfolio's investment advisor.

Growth of Investment illustration is based on an initial investment of $10,000 made since fund inception, assumes reinvestment of dividends and capital gains, but does not include sales charges and fees. Performance would have been lower if sales charges and fees had been included. Results are hypothetical.

Subject to change daily. Fund information, Portfolio Composition and Characteristics are provided for informational purposes only, and should not be deemed as a recommendation to buy or sell any security or securities in the region presented. 

Returns for less than one year are cumulative (not annualized). Performance of other share classes will vary. Returns are net of fees and assume the reinvestment of all dividends and income.

Please keep in mind that double-digit returns are highly unusual and cannot be sustained. Investors should also be aware that these returns were primarily achieved during favorable market conditions.

Note: On September 30, 2015, Morgan Stanley Institutional Fund, Inc. Global Franchise Portfolio recommenced offering Class A shares to new investors and launched Class C shares. The initial minimum investment for Class A and Class C shares is $1,000. On March 30, 2015, Morgan Stanley Institutional Fund, Inc. Global Franchise Portfolio recommenced offering Class I shares of the Portfolio to new investors. 

Effective on May 29, 2015, Morgan Stanley Institutional Fund, Inc. Global Franchise Portfolio began offering Class IS shares. Class IS Shares of the Portfolio are being offered only to eligible investors who must meet a minimum initial investment of $10 million or be a defined contribution, defined benefit or other employer sponsored employee benefit plan with minimum plan assets of $250 million, whether or not qualified under the Internal Revenue Code of 1986, in each case subject to the discretion of the Portfolios’ investment adviser.


PORTFOLIO CHARACTERISTICS DEFINITIONS
Price/earnings (P/E)
is the price of a stock divided by its earnings per share. Sometimes called the multiple, P/E gives investors an idea of how much they are paying for a company’s earning power. The higher the P/E, the more investors are paying, and therefore the more earnings growth they are expecting.


NTM = Next Twelve Months.

Turnover is sourced from the fund's current prospectus.

The index data displayed under allocations are calculated using MSIM and other third-party methodologies and may differ from data published by the vendor.

Subject to change daily.  Portfolio information, composition, and characteristics are provided for informational purposes only, and should not be deemed as a recommendation to buy or sell any security or securities in the sectors presented. Complete holdings for Global Franchise will be available to current shareholders who email client service at msimcs@morganstanley.com.  

Forecast and estimates are subject to change and may not necessarily come to pass due to changing market and/or economic conditions.

RISK/RETURN DEFINITIONS
Active share is the fraction of the portfolio or fund that is invested differently than its benchmark as of the last day of the reporting period. A portfolio with a high degree of Active share does not assure a fund’s relative outperformance. Alpha is the excess return or value added (positive or negative) of the portfolio’s return relative to the return of the benchmark. Beta is a measure of the relative volatility of a security or portfolio to the market's upward or downward movements. A beta greater than 1.0 identifies an issue or fund that will move more than the market, while a beta less than 1.0 identifies an issue or fund that will move less than the market. The Beta of the Market is always equal to 1. Information ratio is the portfolio’s alpha or excess return per unit of risk, as measured by tracking error, versus the portfolio’s benchmark. R squared measures how well an investment’s returns correlate to an index. An R squared of 100 means the portfolio performance is 100% correlated to the index’s, whereas a low r-squared means that the portfolio performance is less correlated to the index’s. Sharpe ratio is a risk-adjusted measure calculated as the ratio of excess return to standard deviation. The Sharpe ratio determines reward per unit of risk. The higher the Sharpe ratio, the better the historical risk-adjusted performance. Standard deviation measures how widely individual performance returns, within a performance series, are dispersed from the average or mean value. Tracking error is the amount by which the performance of the portfolio differs from that of the benchmark.


RISK CONSIDERATIONS
There is no assurance that a portfolio will achieve its investment objective. Portfolios are subject to market risk, which is the possibility that the market value of securities owned by the portfolio will decline. Accordingly, you can lose money investing in this strategy. Please be aware that this strategy may be subject to certain additional risks. Changes in the worldwide economy, consumer spending, competition, demographics and consumer preferences, government regulation and economic conditions may adversely affect global franchise companies and may negatively impact the strategy to a greater extent than if the strategy's assets were invested in a wider variety of companies. In general, equity securities' values also fluctuate in response to activities specific to a company. Stocks of small-capitalization companies carry special risks, such as limited product lines, markets and financial resources, and greater market volatility than securities of larger, more established companies. Investments in foreign markets entail special risks such as currency, political, economic, and market risks. The risks of investing in emerging market countries are greater than the risks generally associated with investments in foreign developed countries. Non-diversified portfolios often invest in a more limited number of issuers. As such, changes in the financial condition or market value of a single issuer may cause greater volatility. Illiquid securities may be more difficult to sell and value than publicly traded securities (liquidity risk).

Morningstar
Rankings: 
The percentile rankings are based on the average annual total returns for the periods stated and do not include any sales charges, but do include reinvestment of dividends and capital gains and Rule 12b-1 fees. The highest (or most favorable) percentile rank is 1 and the lowest (or least favorable) percentile rank is 100. The top-performing fund in a category will always receive a rank of 1.

Ratings: The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Ratings do not take into account sales loads.

© 2017 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

OTHER CONSIDERATIONS
The MSCI World Index is a free float adjusted market capitalization weighted index that is designed to measure the global equity market performance of developed markets. The term "free float" represents the portion of shares outstanding that are deemed to be available for purchase in the public equity markets by investors. The performance of the Index is listed in U.S. dollars and assumes reinvestment of net dividends. The index is unmanaged and does not include any expenses, fees or sales charges. It is not possible to invest directly in an index.


Please consider the investment objective, risks, charges and expenses of the fund carefully before investing. The prospectus contains this and other information about the fund. To obtain a prospectus, download one at morganstanley.com/im or call 1-800-548-7786. Please read the prospectus carefully before investing.

As of January 1, 2011, the SEC requires fund companies to file a new exhibit with risk/return summary information in interactive data (XBRL) format. Click here for XBRL files.

Morgan Stanley Investment Management (MSIM) is the asset management division of Morgan Stanley

Active share is the fraction of the portfolio or fund that is invested differently than its benchmark as of the last day of the reporting period. A portfolio with a high degree of Active share does not assure a fund's relative outperformance.

 

Active share is the fraction of the portfolio or fund that is invested differently than its benchmark as of the last day of the reporting period. A portfolio with a high degree of Active share does not assure a fund's relative outperformance.

 

NTM = Next Twelve Months

 

Turnover is sourced from the fund's current prospectus.

 
 
 

WAM is the weighted average maturity of the portfolio. The WAM calculation utilizes the interest-rate reset date, rather than a security's stated final maturity, for variable- and floating- rate securities. By looking to a portfolio's interest rate reset schedule in lieu of final maturity dates, the WAM measure effectively captures a fund's exposure to interest rate movements and the potential price impact resulting from interest rate movements.

 

WAL is the weighted average life of the portfolio. The WAL calculation utilizes a security's stated final maturity date or, when relevant, the date of the next demand feature when the fund may receive payment of principal and interest (such as a put feature). Accordingly, WAL reflects how a portfolio would react to deteriorating credit (widening spreads) or tightening liquidity conditions.

 

Tracking error and information ratio are calculated using the Portfolio's Blended Index (added October 2, 2013), as this is a better representation of the Portfolio's global multi-asset strategy. The investment team manages the Portfolio relative to this Blended Index.

 

Excess return versus Custom Benchmark is calculated using the Portfolio's Blended Index based on the period since it was added as a benchmark on October 2, 2013.

 

NTM = Next Twelve Months

 

LTM = Last Twelve Months

 

Because the Portfolio had not commenced operations as of the most recent fiscal year end, no portfolio turnover rate is available for the Portfolio.

 

The Reorganization occurred on January 6, 2015. The inception date reflects the inception date of the Private Fund.

 

Global equities is represented by the MSCI All Country World Index.

 

Net exposure % calculated as [(MV of long cash security and derivative positions)-(absolute value of MV in short derivative positions)]/(portfolio MV)

 

Gross exposure % calculated as [(MV of long cash security and derivative positions)+(absolute value of MV in short derivative positions)]/(portfolio MV).

 

Fixed income net and gross exposure is duration adjusted (U.S. Treasury 10-Year equivalents)

 

Security ratings disclosed above have been obtained from Standard & Poor's Ratings Group ("S&P"). S&P's credit ratings express its opinion about the ability and willingness of an issuer to meet its financial obligations in full and on time.'AAA' is the highest rating. Any rating below 'BBB-' rating is considered non-investment grade. Ratings are relative and subjective and are not absolute standards of quality. Ratings apply only to the underlying holdings of the portfolio and does not remove market risk. "NR" or "Not Rated" indicates that no rating has been requested, that there is insufficient information on which to base a rating, or that S&P does not rate a particular obligation as a matter of policy. Futures are not rated.

 

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