International Equity Portfolio
Share Class :
 
MSIQX CUSIP: 61744J408
International Equity Portfolio
MSIQX CUSIP: 61744J408
Share Class :

International Equity Portfolio

SHARE CLASS :
MSIQX CUSIP: 61744J408
 
 
 
 
Investment Approach

The investment team believes that the best route to superior returns is through long-term compounding and seeking a measure of downside protection. The International Equity Portfolio is actively managed by consistently applying strict investment criteria to help identify attractive businesses at a discount to their long-term fair value. In-depth fundamental company research is paramount to the team’s bottom-up stock selection process with emphasis on companies with high or improving Returns on Operating Capital Employed, recurring cash flows and capable management. This investment discipline is maintained by strict adherence to the team’s longstanding investment process and cash-flow-based valuation criteria.

 
 
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 09/30/2018

As of 10/17/2018

As of 09/30/2018

As of 10/17/2018


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

    
Past performance is not indicative of future results.
 
 
Average Annual Total Returns As of 09/30/2018 As of 09/30/2018
1 YR 3 YRS 5 YRS 10 YRS Since Inception
MSIQX (%) 2.38 7.63 3.79 5.28 8.32
MSCI EAFE Index (%) 2.74 9.23 4.42 5.38 4.65
Lipper Category Average (%) 1.90 8.76 4.43 5.52 --
Morningstar Category Average (%) 1.55 8.71 4.05 4.98 --
1 YR 3 YRS 5 YRS 10 YRS Since Inception
MSIQX (%) 2.38 7.63 3.79 5.28 8.32
MSCI EAFE Index (%) 2.74 9.23 4.42 5.38 4.65
Lipper Category Average (%) 1.90 8.76 4.43 5.52 --
Morningstar Category Average (%) 1.55 8.71 4.05 4.98 --
2013 2014 2015 2016 2017
MSIQX (%) 20.39 -6.08 0.36 -2.00 25.17
MSCI EAFE Index (%) 22.78 -4.90 -0.81 1.00 25.03
Lipper Category Average (%) 19.15 -4.82 -3.39 -1.14 27.28
Morningstar Category Average (%) 19.44 -4.98 -1.59 0.79 25.12
 
Average Annual Total Returns
As of 09/30/2018
TIMEFRAME MSIQX USD (%) MSCI EAFE Index (%) Lipper Category Average (%) Morningstar Category Average (%)
1 Yr 2.38 2.74 1.90 1.55
3 Yrs 7.63 9.23 8.76 8.71
5 Yrs 3.79 4.42 4.43 4.05
10 Yrs 5.28 5.38 5.52 4.98
Since Inception 8.32 4.65 -- --
As of 09/30/2018
TIMEFRAME MSIQX USD (%) MSCI EAFE Index (%) Lipper Category Average (%) Morningstar Category Average (%)
1 Yr 2.38 2.74 1.90 1.55
3 Yrs 7.63 9.23 8.76 8.71
5 Yrs 3.79 4.42 4.43 4.05
10 Yrs 5.28 5.38 5.52 4.98
Since Inception 8.32 4.65 -- --
TIMEFRAME MSIQX USD (%) MSCI EAFE Index (%) Lipper Category Average (%) Morningstar Category Average (%)
2013 20.39 22.78 19.15 19.44
2014 -6.08 -4.90 -4.82 -4.98
2015 0.36 -0.81 -3.39 -1.59
2016 -2.00 1.00 -1.14 0.79
2017 25.17 25.03 27.28 25.12
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 Statistics

TIMEFRAME:
    MSIQX Index
Active share (%) 82.84 --
Excess Return (%) -1.60 --
Alpha (%) -0.19 --
Beta (vs. benchmark) 0.83 1.00
Information ratio -0.34 --
R squared 0.81 1.00
Sharpe ratio 0.69 0.78
Standard deviation (%) 9.95 10.77
Tracking error (%) 4.68 --
    MSIQX Index
Active share (%) 82.84 --
Excess Return (%) -0.62 --
Alpha (%) -0.26 --
Beta (vs. benchmark) 0.91 1.00
Information ratio -0.15 --
R squared 0.87 1.00
Sharpe ratio 0.31 0.36
Standard deviation (%) 10.75 11.04
Tracking error (%) 4.03 --
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)
07/05/2018 07/06/2018 07/06/2018 0.026306 0.000000 0.000000 0.000000
12/15/2017 12/18/2017 12/18/2017 0.233839 0.000000 0.000000 0.000000
07/06/2017 07/07/2017 07/07/2017 0.109850 0.000000 0.000000 0.000000
12/15/2016 12/16/2016 12/16/2016 0.141170 0.000000 0.000000 0.000000
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)
07/05/2018 07/06/2018 07/06/2018 0.026306 0.000000 0.000000 0.000000
12/15/2017 12/18/2017 12/18/2017 0.233839 0.000000 0.000000 0.000000
07/06/2017 07/07/2017 07/07/2017 0.109850 0.000000 0.000000 0.000000
12/15/2016 12/16/2016 12/16/2016 0.141170 0.000000 0.000000 0.000000
 
 
Composition As of 09/30/2018
  Fund Index
Consumer Staples 31.46 11.17
Health Care 16.19 11.11
Financials 14.85 19.66
Industrials 12.45 14.51
Information Technology 8.82 6.81
Energy 4.93 6.16
Materials 4.66 8.09
Consumer Discretionary 2.67 12.16
Telecommunication Services 1.24 3.71


Geography4 As of 09/30/2018
  Fund Index
United Kingdom 25.13 17.47
France 15.39 11.21
Japan 14.08 24.56
Germany 12.84 9.41
Netherlands 7.66 3.34
Switzerland 5.57 8.25
Canada 3.25 --
China 3.20 --
South Korea 2.82 --
Hong Kong 2.60 3.52
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 09/30/2018
Fund Index
Reckitt Benckiser Plc 4.84 0.42
Unilever NV 4.29 0.60
Kirin Holdings Company, Limited 3.69 0.15
GlaxoSmithKline Plc 3.69 0.69
British American Tobacco Plc 3.42 0.74
SAP SE 3.41 0.84
Novartis AG 3.31 1.30
Sanofi 2.93 0.69
Pernod Ricard 2.81 0.24
Safran 2.75 0.32
Total 35.14 --


Portfolio Characteristics
Fund Index
Number of holdings 57 924
Price/earnings (NTM) 15 13.56
Turnover (%) 18 --
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
9 years industry experience
Vice President
12 years industry experience
 
 
Insights by International Equity Team
Global Equity Observer
Another Emerging Markets Wobble?
Sep 17, 2018
In response to the latest emerging markets wobble, the International Equity Team argues that a focus on the fundamentals is the best way to avoid the destruction of capital.
Manager Q & A
Q&A with William Lock
Jan 15, 2018
William Lock discusses how a strategy that his team manages has incorporated the Buffett philosophy into a long standing, successful global investment strategy.
 
 
Resources
Product Literature
 
 
Prospectus & Reports
SAI
 
 
 
 
 

^ Morningstar Analyst Ratings: A high rating should not be construed as a guarantee for relatively strong performance. The Morningstar Analyst Rating is not a credit or risk rating. It is a subjective evaluation performed by Morningstar’s Manager Research Group (“MRG”). The MRG evaluates funds based on five key pillars, which are process, performance, people, parent, and price. The MRG uses this five pillar evaluation to determine how they believe funds are likely to perform relative to a benchmark over the long term on a risk-adjusted basis. They consider quantitative and qualitative factors in their research, and the weight of each pillar may vary. The Analyst Rating scale is Gold, Silver, Bronze, Neutral, and Negative. A Morningstar Analyst Rating of Gold, Silver, or Bronze reflects the MRG’s conviction in a fund’s prospects for outperformance. Analyst Ratings ultimately reflect the MRG’s overall assessment, are overseen by an Analyst Rating Committee, and are continuously monitored and reevaluated at least every 14 months. For more detailed information about Morningstar’s Analyst Rating, including its methodology, please go to global.morningstar.com/managerdisclosures/.

The Morningstar Analyst Rating (i) should not be used as the sole basis in evaluating a fund, (ii) involves unknown risks and uncertainties which may cause Analyst expectations not to occur or to differ significantly from what they expected, and (iii) should not be considered an offer or solicitation to buy or sell the fund.

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.

Shares of the portfolio redeemed within 30 days of purchase will be subject to a 2% redemption fee, payable to the portfolio. The redemption fee is designed to protect the portfolio and its remaining shareholders from the effects of short-term trading.  


The Fund has suspended offering Class L shares of the Portfolio 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 are net of fees and assume the reinvestment of all dividends and income. Returns for less than one year are cumulative (not annualized). Performance of other share classes will vary.

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.

This material is a general communication, which is not impartial and all information provided has been prepared solely for informational and educational purposes and does not constitute an offer or a recommendation to buy or sell any particular security or to adopt any specific investment strategy. The information herein has not been based on a consideration of any individual investor circumstances and is not investment advice, nor should it be construed in any way as tax, accounting, legal or regulatory advice. To that end, investors should seek independent legal and financial advice, including advice as to tax consequences, before making any investment decision.

PORTFOLIO CHARACTERISTICS DEFINITIONS
The Net Asset Value (NAV) per share is determined by dividing the value of the fund's portfolio securities, cash and other assets, less all liabilities, by the total number of common shares outstanding. The common share market price is the price the market is willing to pay for shares of the fund at a given time. Number of holdings provided are a typical range, not a maximum number. The portfolio may exceed this from time to time due to market conditions and outstanding trades. 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.

Turnover is sourced from the fund's current prospectus.

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.  Monthly holdings are updated 15 calendar days after month-end.

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

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. Active Share calculation may consolidate holdings with the same economic exposure. Excess Return or value added (positive or negative) is the portfolio’s return relative to the return of the benchmark. Alpha (Jensen's) is a risk-adjusted performance measure that represents the average return on a portfolio or investment above or below that predicted by the capital asset pricing model (CAPM) given the portfolio's or investment's beta and the average market return. Prior to 6/30/2018 Alpha was calculated as the excess return of the fund versus 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 values 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. In general, equities securities’ values also fluctuate in response to activities specific to a company. Investments in foreign markets entail special risks such as currency, political, economic, market and liquidity risks. Investments in small- and medium- capitalization companies tend to be more volatile and less liquid than those of larger, more established, companies. The risks of investing in emerging market countries are greater than risks associated with investments in foreign developed markets. Derivative instruments can be illiquid, may disproportionately increase losses and may have a potentially large negative impact on the portfolio’s performance. 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.

© 2018 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 EAFE Index (Europe, Australasia, Far East) is a free float-adjusted market capitalization index that is designed to measure the international equity market performance of developed markets, excluding the US & Canada. 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 MSCI EAFE Index currently consists of 21 developed market country indices. 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. 

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

NTM = Next Twelve Months

 
 
 

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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