Disclosures

A Winning Model

This article has been prepared for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. It does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Morgan Stanley Smith Barney LLC (hereafter "Morgan Stanley" or “the Firm”) recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a Morgan Stanley Financial Advisor or Private Wealth Advisor.

The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. The views and opinions expressed in this commentary are those of the speakers at the time of this writing and do not necessarily represent those of Morgan Stanley Smith Barney LLC, its affiliates or its other employees. Of course, these views may change without notice in response to changing circumstances and market conditions. Furthermore, this commentary contains forward-looking statements and there can be no guarantee that they will come to pass. Past performance is not a guarantee of future results.

Although the statements of fact and data in this report have been obtained from, and are based upon, sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed. All opinions included in this article are subject to change without notice.

Indexes are unmanaged. An investor cannot invest directly in an index.

Because of their narrow focus, sector investments tend to be more volatile than investments that diversify across many sectors and companies.

Investing in smaller companies involves greater risks not associated with investing in more established companies, such as business risk, significant stock price fluctuations and illiquidity.

Zacks calculates the performance of the brokerage "model portfolios" it tracks, on an equal-weighted basis. Total return performance figures include stock price changes, and dividends for each addition and deletion to the model portfolios. Commissions are not included. The Barron’s-Zacks focus-list stock selection ranking may not be representative of anyone’s experience and is not indicative of future performance. Neither Morgan Stanley nor any of its affiliates pay a fee to Barron’s or Zacks in exchange for the ranking.

Morgan Stanley Wealth Management or an affiliate beneficially owned 1% or more of a class of common equity securities of: APPLE INC., COSTCO WHOLESALE CORPORATION, TIME WARNER INC.

Within the last 12 months, Morgan Stanley Wealth Management or an affiliate received compensation for investment banking services from the following issuers (if the security is an ETF or Closed-End Fund, the compensation is from the fund's investment manager or advisor): TIME WARNER INC.

In the next 3 months, Morgan Stanley Wealth Management or an affiliate will seek compensation for investment banking services from the following issuers (if the security is an ETF or Closed-End Fund, the compensation is from the fund's investment manager or advisor): APPLE INC., COSTCO WHOLESALE CORPORATION, TIME WARNER INC.

Within the last 12 months, Morgan Stanley Wealth Management or an affiliate managed or co-managed a public offering (or 144a offering) for: TIME WARNER INC.

Within the last 12 months, Morgan Stanley Wealth Management or an affiliate has provided or is providing investment banking services to, or has an investment banking client relationship with, the following issuers (if the security is an ETF or Closed-End Fund, the services were or are being provided to, or the relationship is with, the fund's investment manager or advisor): APPLE INC., COSTCO WHOLESALE CORPORATION, TIME WARNER INC.

Within the last 12 months, Morgan Stanley Wealth Management has either provided or is providing non-investment banking, securities-related services to and/or in the past has entered into an agreement to provide services or has a client relationship with the following issuers (if the security is an ETF or Closed-End Fund, the services were or are being provided to, or the agreement is with, the fund's investment manager or advisor): APPLE INC., COSTCO WHOLESALE CORPORATION, TIME WARNER INC.

An affiliate of Morgan Stanley Wealth Management has a significant financial interest in relation to the following issuers (if the security is an ETF or Closed-End Fund, the significant financial interest is in relation to the fund's investment manager or advisor): APPLE INC., COSTCO WHOLESALE CORPORATION, TIME WARNER INC. For an explanation of the determination of significant financial interest, please refer to the applicable policies for managing conflicts of interest, which can be found at https://www.morganstanley.com/online/researchconflictpolicies.

The research analysts or strategists principally responsible for the preparation of Morgan Stanley Wealth Management Research have received compensation based upon various factors, including quality of research, investor client feedback, competitive factors, and firm profitability or revenues (which include fixed income trading and capital markets profitability or revenues). Research analysts’ or strategists’ compensation is not linked to the profitability or revenues of particular capital markets transactions performed by Morgan Stanley Wealth Management or the profitability or revenues of particular fixed income trading desks.

Morgan Stanley Wealth Management and its affiliates do business that relates to companies/instruments covered in Morgan Stanley Wealth Management Research. Morgan Stanley Wealth Management and/or its affiliates sells to and buys from customers the securities/instruments of issuers covered in this Morgan Stanley Wealth Management Research report on a principal basis.

Certain disclosures listed above are also for compliance with applicable regulations in non-US jurisdictions.