Morgan Stanley Investment Management has the Advantage in U.S. Equities

Morgan Stanley Investment Funds Winner 2011 Equity North America Category over 3 years—Hong Kong

Hong Kong —

Morgan Stanley (NYSE: MS) announced today Morgan Stanley Investment Funds U.S. Advantage Fund (“the Fund”), managed by Morgan Stanley Investment Management (MSIM), has been awarded by Lipper for best performance over three years.

Central to achieving the Fund’s performance objectives is the team’s strict adherence to their investment philosophy. The team, led by Dennis Lynch, managing director, believes that a focus on long-term growth, rather than reactions to short-term, macroeconomic events can achieve value-added investment results more consistently. “If you have a short-term mindset, you might not care about the quality of the business, but more the way it responds to macroeconomic changes,” said Mr. Lynch. “Our stock selection process is informed by rigorous fundamental analysis to unearth those companies with an inherent sustainable competitive advantage.” A recipe well recognized by investors—the growth team at Morgan Stanley oversees more than US$21 billion in assets.

For the three years ended December 31, 2010, the Fund achieved an absolute return of 10.67%, compared to a return of -7.13% for the Fund’s benchmark, the S&P 500 Index. The performance is outstanding given the Fund’s holdings are concentrated to a typical range of 30–45 companies. “In our case, our portfolio tends to be 90% differentiated from the benchmark,” Mr. Lynch said. “We don’t build our portfolio too much around the benchmark, but around our best ideas.”

“We hope that our emphasis on quality and diversification limits portfolio volatility during periods of market stress,” he said. “We try not to react to extreme environments.” In 2008 the team held firm to their tried and tested investment approach of making long-term investments while watching the U.S. equity market plummet and the economy go into recession.  “It was a painful period but our patience and conviction have been rewarded,” Mr. Lynch said.

The Morgan Stanley Investment Funds U.S. Advantage Fund is available in Hong Kong via Morgan Stanley’s partner distributor, AIA.

Morgan Stanley is a leading global financial services firm providing a wide range of investment banking, securities, investment management and wealth management services.  The Firm’s employees serve clients worldwide including corporations, governments, institutions and individuals from more than 1,200 offices in 42 countries.  For further information about Morgan Stanley, please visit


Media Relations Contact: Noel Cheung, (852) 2848 6788