Morgan Stanley Investment Management Launches Alternative Investment Partners Absolute Return Fund

New Fund of Hedge Funds Offers a Management Team with Established Track Record of Success Provides Affluent Investors and Small Institutions Access to Hedge Funds

New York —

Morgan Stanley Investment Management announced today that it has launched the Alternative Investment Partners Absolute Return Fund ("Absolute Return Fund"), a fund of hedge funds that is registered under the Investment Company Act of 1940 which offers an institutional-quality portfolio of hedge funds to eligible individual investors and smaller institutional clients.

For a relatively low minimum initial investment of $100,000, and $50,000 for additional purchases, accredited investors have access to the established track record and skills of Morgan Stanley Alternative Investment Partners' investment team. The group, founded in April 2000, manages portfolios of hedge funds and private equity assets for some of the world's largest institutions and high net worth individuals.

The Absolute Return Fund's management team is led by Mustafa Jama, Head and Chief Investment Officer of Liquid Markets of Morgan Stanley Alternative Investment Partners. Employing an "absolute return strategy," the Fund seeks to achieve attractive risk-adjusted returns over the broad range of market environments. In addition, the fund of hedge funds structure may potentially lower portfolio risk by diversifying across a broad number of funds and strategies.

"Launching the Absolute Return Fund is a natural way for us to utilize our experience and relationships in the hedge fund industry to bring more sophisticated products to a greater number of our clients," said Stuart Bohart, Head of Alternative Investments of Morgan Stanley Investment Management. "The Absolute Return Fund is an attractive option for investors who are looking to generate returns that are independent of traditional markets."

"By leveraging our global resources and investment expertise, we are offering our clients a broad range of creative investment solutions, like the Absolute Return Fund," said Owen Thomas, President and Chief Operating Officer of Morgan Stanley Investment Management. "Over the past few months, we have continued to build momentum across our asset management business, especially in the alternative investments space, where we have launched several new alternative products and further strengthened our investment capabilities."

Morgan Stanley Investment Management, together with its investment advisory affiliates, has over 400 investment professionals around the world and $442 billion in assets under management or supervision as of February 28th, 2006. These entities offer investment management services to a diverse client base, which includes governments, institutions, corporations and individuals.

Morgan Stanley (NYSE: MS) is a global financial services firm and a market leader in securities, investment management and credit services. With more than 600 offices in 30 countries, Morgan Stanley connects people, ideas, and capital to help clients achieve their financial aspirations.

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There is no assurance that a mutual fund will achieve its investment objective.

Please consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. The prospectus contains this and other information about the Fund. To obtain a prospectus, contact your financial advisor. Please read the prospectus carefully before investing.

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