U.S. Real Estate Portfolio
Share Class :
MSUSX CUSIP: 61744J671
U.S. Real Estate Portfolio
MSUSX CUSIP: 61744J671
Share Class :

U.S. Real Estate Portfolio

MSUSX CUSIP: 61744J671
Investment Objective

Seeks to provide above-average current income and long-term capital appreciation by investing primarily in equity securities of companies in the U.S. real estate industry, including real estate investment trusts.

Investment Approach

We seek attractive long-term, risk-adjusted returns by investing in publicly traded U.S. real estate securities. We combine a value-oriented, bottom-up-driven investment strategy and a top-down allocation that seeks diversified exposure to all major asset classes with an overweighting to property markets that we believe offer the best relative valuation.

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 08/31/2020

As of 09/25/2020

As of 08/31/2020

As of 09/25/2020

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

Past performance is not indicative of future results.
Average Annual Total Returns As of 08/31/2020 As of 06/30/2020
1 YR 3 YRS 5 YRS 10 YRS Since Inception
MSUSX -24.21 -6.32 -1.13 5.08 9.57
FTSE Nareit Equity REITs Index (%) -12.92 1.30 5.25 8.73 9.71
Lipper Category Average (%) -7.88 2.75 5.54 8.65 --
Morningstar Category Average (%) -9.17 1.94 5.27 8.59 --
1 YR 3 YRS 5 YRS 10 YRS Since Inception
MSUSX -25.23 -7.06 -1.64 5.74 9.57
FTSE Nareit Equity REITs Index (%) -13.04 0.03 4.06 9.05 9.57
Lipper Category Average (%) -8.40 1.38 4.23 8.91 --
Morningstar Category Average (%) -9.81 0.60 3.98 8.86 --
2019 2018 2017 2016 2015 2014 2013
MSUSX 18.40 -8.44 3.31 6.79 2.27 30.74 2.45
FTSE Nareit Equity REITs Index (%) 26.00 -4.62 5.23 8.52 3.20 30.14 2.47
Lipper Category Average (%) 26.98 -6.16 6.02 7.03 2.17 27.64 1.75
Morningstar Category Average (%) 27.28 -5.97 6.22 6.89 2.41 28.03 1.55
Average Annual Total Returns
As of 08/31/2020
TIMEFRAME MSUSX FTSE Nareit Equity REITs Index (%) Lipper Category Average (%) Morningstar Category Average (%)
1 Yr -24.21 -12.92 -7.88 -9.17
3 Yrs -6.32 1.30 2.75 1.94
5 Yrs -1.13 5.25 5.54 5.27
10 Yrs 5.08 8.73 8.65 8.59
Since Inception 9.57 9.71 } -- --
As of 06/30/2020
TIMEFRAME MSUSX FTSE Nareit Equity REITs Index (%) Lipper Category Average (%) Morningstar Category Average (%)
1 Yr -25.23 -13.04 -8.40 -9.81
3 Yrs -7.06 0.03 1.38 0.60
5 Yrs -1.64 4.06 4.23 3.98
10 Yrs 5.74 9.05 8.91 8.86
Since Inception 9.57 9.57 } -- --
TIMEFRAME MSUSX FTSE Nareit Equity REITs Index (%) Lipper Category Average (%) Morningstar Category Average (%)
2019 18.40 26.00 26.98 27.28
2018 -8.44 -4.62 -6.16 -5.97
2017 3.31 5.23 6.02 6.22
2016 6.79 8.52 7.03 6.89
2015 2.27 3.20 2.17 2.41
2014 30.74 30.14 27.64 28.03
2013 2.45 2.47 1.75 1.55
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

Alpha (%) -7.57
Beta (vs. benchmark) 1.14
Excess return (%) -7.62
Information ratio -1.19
R squared 0.93
Sharpe ratio -0.35
Standard deviation (%) 22.58
Tracking error (%) 6.42
Up-capture ratio (%) 73.39
Down-capture ratio (%) 109.93
Alpha (%) -6.84
Beta (vs. benchmark) 1.11
Excess return (%) -6.38
Information ratio -1.22
R squared 0.94
Sharpe ratio -0.12
Standard deviation (%) 19.31
Tracking error (%) 5.22
Up-capture ratio (%) 79.21
Down-capture ratio (%) 110.49
Past performance is not indicative of future results.
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)
07/01/2020 07/02/2020 07/02/2020 0.070000 0.000000 0.000000 0.000000
04/01/2020 04/02/2020 04/02/2020 0.082500 0.000000 0.000000 0.000000
12/10/2019 12/11/2019 12/11/2019 0.123858 1.291700 0.000000 1.291700
10/01/2019 10/02/2019 10/02/2019 0.092500 0.000000 0.000000 0.000000
07/01/2019 07/02/2019 07/02/2019 0.092500 0.000000 0.000000 0.000000
04/01/2019 04/02/2019 04/02/2019 0.092500 0.000000 0.000000 0.000000
12/10/2018 12/11/2018 12/11/2018 0.092500 2.168100 0.000000 2.168100
10/01/2018 10/02/2018 10/02/2018 0.092500 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)
07/01/2020 07/02/2020 07/02/2020 0.070000 0.000000 0.000000 0.000000
04/01/2020 04/02/2020 04/02/2020 0.082500 0.000000 0.000000 0.000000
12/10/2019 12/11/2019 12/11/2019 0.123858 1.291700 0.000000 1.291700
10/01/2019 10/02/2019 10/02/2019 0.092500 0.000000 0.000000 0.000000
07/01/2019 07/02/2019 07/02/2019 0.092500 0.000000 0.000000 0.000000
04/01/2019 04/02/2019 04/02/2019 0.092500 0.000000 0.000000 0.000000
12/10/2018 12/11/2018 12/11/2018 0.092500 2.168100 0.000000 2.168100
10/01/2018 10/02/2018 10/02/2018 0.092500 0.000000 0.000000 0.000000
Composition As of 06/30/2020
Office 22.58
Apartments 16.70
Industrial 10.28
Health Care 9.77
Regional Malls 9.16
Lodging/Resorts 7.22
Self Storage 5.84
Diversified 4.59
Data Centers 4.40
Shopping Centers 3.96
Other 5.05
Cash 0.31
May not sum to 100% due to the exclusion of other assets and liabilities.

Holdings As of 08/31/2020
Prologis Inc 8.90
SL Green Realty Corp 8.17
Simon Property Group 8.14
Boston Properties Inc 5.40
AvalonBay Communities Inc 5.36
Ventas Inc 3.98
Digital Realty Trust 3.89
Host Hotels & Resorts Inc 3.49
Equity Residential Properties 3.44
Public Storage Inc 2.98
Total 53.75

Portfolio Characteristics
Active share (%) 49.49
Number of holdings 48
Weighted average market capitalization ($B) 17.21
Weighted median market capitalization ($B) 13.11
Turnover (%) 21
Portfolio turnover is sourced from the fund's current prospectus. View current prospectus for the as of date.
Product Literature
Prospectus & Reports

Class C shares include deferred sales charge of 1.00% which declines to zero after first year.

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/Trustees 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 and application of fees, but does not include sales charges. Performance would have been lower if sales charges 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 sectors 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.

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. 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.  Weighted Average Market Capitalization is an average of the market capitalization of stocks comprising a portfolio or index, adjusted by each stock’s weight in the portfolio or index. The Weighted Median Market Capitalization is the point at which half of the market value of a portfolio or index is invested in stocks with a greater market cap, while the other half of the market value is invested in stocks with a lower market cap.

Turnover is sourced from the fund's current prospectus.

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. 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. Upside/downside market capture measures annualized performance in up/down markets relative to the market benchmark.

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 and that the value of portfolio shares may therefore be less than what you paid for them. Market values can change daily due to economic and other events (e.g. natural disasters, health crises, terrorism, conflicts and social unrest) that affect markets, countries, companies or governments. It is difficult to predict the timing, duration, and potential adverse effects (e.g. portfolio liquidity) of events. Accordingly, you can lose money investing in this portfolio. Please be aware that this portfolio may be subject to certain additional risks. In general, equities securities’ values also fluctuate in response to activities specific to a company. Real estate investments, including real estate investment trusts, are subject to risks similar to those associated with the direct ownership of real estate and they are sensitive to such factors as management skills and changes in tax laws. Nondiversified 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. Stocks of small- and medium-capitalization companies entail special risks, such as limited product lines, markets and financial resources, and greater market volatility than securities of larger, more established companies. When investing in value securities (those believed to be undervalued in comparison to their peers), the market may not have the same value assessment as the manager, and, therefore, the performance of the securities may decline.

^ Morningstar Analyst Ratings ("Rating"): The Rating is a subjective evaluation, is not a credit or risk rating, and a high rating is not a guarantee for relatively strong performance. The Morningstar’s Manager Research group (“MRG”) evaluates funds based on five key pillars (process, performance, people, parent, and price) 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. The weighting analysis for actively managed strategies are: people and process 45% each; parent 10%; performance has no explicit weight (it is incorporated into people and process); price (share-class level where applicable) is subtracted from an expected gross alpha estimate derived from the analysis of other pillars. The impact of the weighted pillar scores for people, process and parent on the final Rating is further modified by a measure of the dispersion of historical alphas among relevant peers.

Rating scale: Gold, Silver, Bronze, Neutral, and Negative. For active funds, Gold, Silver, or Bronze reflects the MRG’s level of expectation that the fund will be able to deliver positive alpha net of fees relative to the standard benchmark index assigned to the Morningstar category. Ratings 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, including its methodology: https://shareholders. morningstar.com/investorrelations/governance/Compliance-Disclosure/default.aspx.

The Rating (i) should not be used as the sole basis in evaluating a fund, (ii) involves unknown risks and uncertainties which may cause the MRG’s 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.

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.

© 2020 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.

The FTSE Nareit (National Association of Real Estate Investment Trusts) Equity REITs Index is a free float-adjusted market-capitalization-weighted index of tax qualified REITs listed on the New York Stock Exchange, NYSE Amex and the NASDAQ National Market Systems. 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 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. 


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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