The Alts Report

VIDEO TRANSCRIPT

[COLD OPEN]

BRIAN HOLZER: Infrastructure was once viewed as more of a niche asset class. But today we’re seeing broader adoption amongst our clients.

CONNOR TESKEY: Over 70% of the assets that we invest in today were not investable asset classes 12 or 15 years ago.

[CUT TO THE ALTS REPORT OPENING SEQUENCE]

INTRODUCTION – BRIAN HOLZER

00:33

Welcome to The Alts Report, where we explore the value of alternative investments and the trends shaping today's markets.

LOWER THIRDS:
Brian Holzer
Head of Alternative Investments Sales & Distribution
Morgan Stanley Wealth Management

00:38

I'm pleased to welcome Connor Teskey, CEO of Brookfield Asset Management. Today, we're discussing infrastructure, an asset class where we have seen increased adoption amongst our clients. Infrastructure assets help to form the backbone of the economy.

00:52

They are essential systems that support how we live and work every day, from utilities that power our homes to data centers that help fuel the growth of artificial intelligence and transportation networks that move goods and connect people around the world. And these are just a few examples.

01:05

DISCUSSION

So, Connor, thanks for being with us today.

So, as I mentioned in my opening, infrastructure was once viewed as more of a niche asset class. But today we're seeing broader adoption amongst our clients. What do you think has changed?

ON-SCREEN QUESTION: Why is infrastructure seeing broader adoption?

01:17

CONNOR TESKEY

LOWER THIRDS:
Connor Teskey
Chief Executive Officer
Brookfield Asset Management

First of all, thank you for having us. Infrastructure is quickly becoming one of the largest and most excitable investment opportunities. And it's really being driven by two things. One, the opportunity set continues to expand. We've been investing in infrastructure for multiple decades. And one of the lines we like to use is over 70% of the assets that we invest in today were not investable asset classes 12 or 15 years ago. I'll give you an example.

01:48

15 years ago, we invested in toll roads and railroads. Today, we still invest in toll roads and railroads, but we also invest in telecom towers and fiber networks and data centers. 15 years ago, we invested in hydroelectric power dams. We still do that, but we also invest in solar and batteries and nuclear.

02:10

So, not only has the asset class grown, the benefits of investing in infrastructure have proven over the last several years to provide attributes to an investor's portfolio. They can provide stability, they're long duration, they're cash generative. And they can help protect against inflation.

02:29

BRIAN HOLZER

There have been some emerging trends over the past several years that are helping to drive some of this opportunity set, right? So how do you think about what is more cyclical excitement versus kind of real durable demand.

ON-SCREEN QUESTION: What are some of the long-term trends that are driving the opportunity set?

02:43

CONNOR TESKEY

Let's focus on the durable demand. About five years ago we identified three major themes in infrastructure that we thought would inform a lot of our activity over the next, let's say, 2 to 3 years. And those themes were the digitalization of absolutely everything. The world would need more energy than ever before, and the rewiring of global supply chains to focus on resiliency and production of critical goods and services closer to home.

03:12

And those themes were very exciting because, quite frankly, the growth opportunities and the capital needs were so significant that they not only outstripped the capital available from governments, they also outstripped the capital available from public markets. And that created a very large and attractive opportunity set for investors and private capital. Fast forward to today. Those three themes are actually more relevant today than they were five years ago. So we think those themes are going to run through the end of this decade and beyond.

03:45

BRIAN HOLZER

A fair point. When you think about certain trends, like artificial intelligence and others, they've only been accelerating over the past several years. You had touched on sources of funds, right? It used to be either governments, utilities, even public markets. What has happened over the past few years and why is private capital such an important source of funding today?

ON-SCREEN QUESTION: Why is private capital an important source of funding?

04:05

CONNOR TESKEY

So I think it goes to what is driving the growth in the infrastructure asset class. And,  perhaps, let's say over the last 20 years, private capital has been increasing as an alternative or a substitute for government money. Historically, governments want to own the critical assets and provide the essential services to their population. Over the last two decades, the demand and desire to provide those services has only gone up. At the same time, government balance sheets have become stretched, and they don't actually have the financial firepower to fund those critical assets and essential services.

04:45

And that's created an opportunity for private capital to step in and invest in these critical infrastructure assets, both the existing ones and building new ones for the future. But there's also this second additional driver of growth in the asset class, which is corporates. The largest corporates around the world, which today are as large and as important as some of the major governments around the world.

05:10

They want their own infrastructure. They want security over their own supply chain. They want control over their own inputs. And that's creating a second demand layer for infrastructure. That, of course, is not going to be funded for governments, by governments, because it's not for the broader population, it's for those corporates themselves. So as the infrastructure asset class has continued to be an incredible source for capital, it's required that the private markets take an increasingly important and larger role.

05:42

BRIAN HOLZER

So let's pivot to asset allocation and portfolio construction. So, institutional investors have been large allocators to infrastructure for decades at this point. I mentioned in my opening we've seen increased adoption from high-net-worth, but still relatively under allocated. How do you think access has changed over the past few years, and how do you view that going forward?

ON-SCREEN QUESTION: How has access to infrastructure evolved?

06:07

CONNOR TESKEY

Access has changed tremendously just in terms of the products and strategies that are now increasingly available for high-net-worth investors. But, as we think about that, institutional investors are incredibly large organizations that are well designed to portfolio manage, handle liquidity, manage downside. When we think about the asset class for the high-net-worth investor, it's one that can provide attractive returns. But increased downside protection, a greater stability of earnings and potential protection against inflation, that is the investment profile, of infrastructure.

06:53

So, it's not only as the asset class becomes increasingly available, through new products and strategies that are available to high net worth. But just the increasing adoption that we've seen in the institutional segment over the last two decades, we're seeing in the high-net-worth segment just on a slightly lagged basis, and we expect both to see, continued allocations to infrastructure going forward and growing allocations.

07:18

BRIAN HOLZER

So final question, and you touched on a little bit, some of the other comments, but where do you see infrastructure fitting into a portfolio, and what role can it potentially play for long term investors?

ON-SCREEN QUESTION: What role can infrastructure potentially play for long-term investors?

07:30

CONNOR TESKEY

Infrastructure can sit right in that hybrid between your traditional public equity and your traditional public debt. It can provide you a return. But with downside protection, recurring cash generation and potential inflation protection, those four points, are really the hallmarks of the asset class. And what we're seeing in institutional portfolios, we very much expect to see replicated in high-net-worth portfolios over time, where as there is an increasing allocation to alternatives, we expect infrastructure to make a disproportionate amount of that alternative allocation given that the characteristics of it very much match what individual investors are looking for.

08:15

BRIAN HOLZER

And I think in today's environment, I think all of those unique return attributions are top of mind for both institutional and high-net-worth investors.

 08:23

CONNOR TESKEY

You're absolutely correct. And not only are they increasingly top of mind every time there is a short-term disruption or headwind in the market over the last 5 or 6 years, infrastructure has just proven to reinforce those attributes, whether it was through a pandemic or through rising interest rates.

08:48

CLOSING – BRIAN HOLZER

Connor, this was great. Thank you again for being with us. We appreciate all of you joining us for this edition of The Alts Report. To learn more about Alternative Investments and our platform at Morgan Stanley, please visit morganstanley.com/alts or reach out to your Morgan Stanley Financial Advisor or Private Wealth Advisor. We look forward to seeing you next time.

VIDEO DISCLOSURES

Morgan Stanley Smith Barney LLC ("Morgan Stanley Wealth Management") - IMPORTANT DISCLOSURES

Morgan Stanley Wealth Management acts as a placement agent in connection with the offering and sale of the securities of the fund to current and prospective clients of Morgan Stanley Wealth Management or its affiliates. Morgan Stanley Wealth Management will receive cash compensation for its activities as placement agent from the fund’s manager, as described in Morgan Stanley Wealth Management’s point of sale letter, if applicable. In addition, Morgan Stanley Wealth Management, its affiliates or employees, may have additional relationships with the fund’s manager, including as an investor in the fund or other investment vehicles managed by the fund’s manager or as a client of the fund’s manager. The payment of cash compensation to Morgan Stanley Wealth Management, and any additional relationships that Morgan Stanley Wealth Management or its affiliates may have with the fund’s manager or other investment vehicles managed by the fund’s manager, create material conflicts of interest for Morgan Stanley Wealth Management in its role as placement agent.

All expressions of opinion are subject to change without notice and are not intended to be a forecast of future events or results. Further, opinions expressed herein may differ from the opinions expressed by Morgan Stanley Wealth Management and/or other businesses/affiliates of Morgan Stanley Wealth Management.

Alternative investments often are speculative and include a high degree of risk. Investors could lose all or a substantial amount of their investment. Alternative investments are appropriate only for eligible, long-term investors who are willing to forgo liquidity and put capital at risk for an indefinite period of time. They may be highly illiquid and can engage in leverage and other speculative practices that may increase the volatility and risk of loss. Alternative Investments typically have higher fees than traditional investments. Investors should carefully review and consider potential risks before investing.

The sole purpose of this material is to inform, and it in no way is intended to be an offer or solicitation to purchase or sell any security, other investment or service, or to attract any funds or deposits.  Investments mentioned may not be appropriate for all clients. Any product discussed herein may be purchased only after a client has carefully reviewed the offering memorandum and executed the subscription documents. Morgan Stanley Wealth Management has not considered the actual or desired investment objectives, goals, guidelines, or factual circumstances of any investor in any fund(s). Before making any investment, each investor should carefully consider the risks associated with the investment, as discussed in the applicable offering memorandum, and make a determination based upon their own particular circumstances, that the investment is consistent with their investment objectives and risk tolerance.

As a diversified global financial services firm, Morgan Stanley Wealth Management engages in a broad spectrum of activities including financial advisory services, investment management activities, sponsoring and managing private investment funds, engaging in broker-dealer transactions and principal securities, commodities and foreign exchange transactions, research publication, and other activities. In the ordinary course of its business, Morgan Stanley Wealth Management therefore engages in activities where Morgan Stanley Wealth Management’s interests may conflict with the interests of its clients, including the private investment funds it manages. Morgan Stanley Wealth Management can give no assurance that conflicts of interest will be resolved in favor of its clients or any such fund.

Alternative investments involve complex tax structures, tax inefficient investing, and delays in distributing important tax information. Individual funds have specific risks related to their investment programs that will vary from fund to fund. Clients should consult their own tax and legal advisors as Morgan Stanley Wealth Management does not provide tax or legal advice.

Morgan Stanley Wealth Management is a business of Morgan Stanley Smith Barney LLC.

© 2026 Morgan Stanley Smith Barney LLC. Member SIPC. Alternative investment securities discussed herein are not covered by the protections provided by the Securities Investor Protection Corporation, unless such securities are registered under the Securities Act of 1933, as amended, and are held in a Morgan Stanley Wealth Management Individual Retirement Account.

CRC 5589406 06/26

VIDEO TRANSCRIPT

[COLD OPEN]

TROY GAYESKI

There isn't an earnings problem in equities. We have great companies, particularly in the US. But valuations are extremely stretched. And so, whenever you start at such high valuations the question is how do you complement your large and mega cap tech in particular…

[CUT TO THE ALTS REPORT OPENING SEQUENCE]

[INTRO 0:30]

BRIAN HOLZER

Welcome to The Alts Report where we explore the value of Alternative Investments and the trends shaping today's markets. Today, I'm pleased to welcome Troy Gayeski, Chief Market Strategist for Future Standard to The Alts Report. Our topic today is implementing alternative investments in portfolios. Alternatives are diverse by design. Each asset class has its own characteristics and considerations. That is why it can be important to evaluate and select strategies that align with your long-term financial goals.

So, Troy, thanks for being with us today. Let's get started. Can you outline a few of the key challenges advisors and clients are facing in today's current market environment?

[1:10]

TROY GAYESKI

Yeah, we'd say there's three and I'll start with the newest one. It’s how do you help clients put these massive cash piles to work that have built up dramatically since the pandemic, where you're meaningfully increasing income and/or total return. You know, some strategies are total return, some are income…

BRIAN HOLZER

Sure.

[1:25]

TROY GAYESKI

…without taking uncomfortable levels of risk. So that would be challenge one.

You know, challenge two is there isn't an earnings problem in equities. We have great companies, particularly in the US. But valuations are extremely stretched. And so, whenever you start at such high valuations the question is how do you complement your large and mega cap tech in particular.

TROY GAYESKI

But also US equity exposure hopefully taking less risk and not leaving too much money on the table. And then the third, you know, it's really been with us since 17 or 18 is how do you complement or replace fixed income to have more income with less volatility? And I'd say the challenge is as acute today as it was in 2020 and 21 before the Fed hiked. So cash replacement or complement, equity complement or replacement, and fixed income complement or replacement.

[2:15]

BRIAN HOLZER

So as, as somebody that spends a lot of time with advisors and clients, right, as you are talking to them about implementing alternatives, what are some of the common pushbacks or apprehension that advisors or clients have?

TROY GAYESKI

In the middle market, capital activity has been much more profound and pronounced exiting via strategic acquisitions or exiting via larger sponsor acquisitions.

[2:38]

In commercial real estate, it's no surprise we just went through a bear market. So you can understand why clients and advisors aren't in a rush to allocate there, but as we've bottomed, we've started to see a meaningful pickup in positive net inflows again, which is logical given that all of these asset classes have to go through a bottoming process. And, we're really optimistic about the forward returns in the forward flow there.

[3:00]

BRIAN HOLZER

So, last question. So for advisors and clients that are watching this that have not invested in alternatives before, how do you think about implementation? Where should they consider starting by asset class, by structure?

TROY GAYESKI

Yeah. Great question. So for those that have not been big users of alternatives historically, you know, typically one of the first ways to get clients invested is that cash or fixed income replacement substitute. Everyone likes income. Everyone likes to see the income go up meaningfully. And no one wants to take material downside risk. So that that would be one.

[3:30]

Another way is, if you're starting in alternatives, you more than likely at this stage of the game want to utilize an evergreen vehicle because yes, you are sacrificing some degree of liquidity. You have monthly subscriptions, typically quarterly redemptions with tendering limitations, but you're not locking up your money for seven, 10 or 12 years.

[3:50]

BRIAN HOLZER

Yeah, and I think we're even seeing that across our platform, right? Folks starting with evergreen funds building the core. And then for clients that can accept a degree of illiquidity, right? Satelliting drawdown funds around that. So I think that, that makes a lot of sense. So Troy, that was great.

[4:05]

[CLOSING]

Thanks for joining us. We appreciate you all joining us for this edition of The Alts Report. To learn more about Alternative Investments and our platform at Morgan Stanley, please visit ms.com/alts or reach out to your Morgan Stanley Financial Advisor or Private Wealth Advisor. We look forward to seeing you next time.

==

VIDEO DISCLOSURES

Morgan Stanley Smith Barney LLC ("Morgan Stanley Wealth Management") - IMPORTANT DISCLOSURES

Morgan Stanley Wealth Management acts as a placement agent in connection with the offering and sale of the securities of the fund to current and prospective clients of Morgan Stanley Wealth Management or its affiliates. Morgan Stanley Wealth Management will receive cash compensation for its activities as placement agent from the fund’s manager, as described in Morgan Stanley Wealth Management’s point of sale letter, if applicable. In addition, Morgan Stanley Wealth Management, its affiliates or employees, may have additional relationships with the fund’s manager, including as an investor in the fund or other investment vehicles managed by the fund’s manager or as a client of the fund’s manager. The payment of cash compensation to Morgan Stanley Wealth Management, and any additional relationships that Morgan Stanley Wealth Management or its affiliates may have with the fund’s manager or other investment vehicles managed by the fund’s manager, create material conflicts of interest for Morgan Stanley Wealth Management in its role as placement agent.

All expressions of opinion are subject to change without notice and are not intended to be a forecast of future events or results. Further, opinions expressed herein may differ from the opinions expressed by Morgan Stanley Wealth Management and/or other businesses/affiliates of Morgan Stanley Wealth Management.

Alternative investments often are speculative and include a high degree of risk. Investors could lose all or a substantial amount of their investment. Alternative investments are appropriate only for eligible, long-term investors who are willing to forgo liquidity and put capital at risk for an indefinite period of time. They may be highly illiquid and can engage in leverage and other speculative practices that may increase the volatility and risk of loss. Alternative Investments typically have higher fees than traditional investments. Investors should carefully review and consider potential risks before investing.

The sole purpose of this material is to inform, and it in no way is intended to be an offer or solicitation to purchase or sell any security, other investment or service, or to attract any funds or deposits.  Investments mentioned may not be appropriate for all clients. Any product discussed herein may be purchased only after a client has carefully reviewed the offering memorandum and executed the subscription documents. Morgan Stanley Wealth Management has not considered the actual or desired investment objectives, goals, guidelines, or factual circumstances of any investor in any fund(s). Before making any investment, each investor should carefully consider the risks associated with the investment, as discussed in the applicable offering memorandum, and make a determination based upon their own particular circumstances, that the investment is consistent with their investment objectives and risk tolerance.

As a diversified global financial services firm, Morgan Stanley Wealth Management engages in a broad spectrum of activities including financial advisory services, investment management activities, sponsoring and managing private investment funds, engaging in broker-dealer transactions and principal securities, commodities and foreign exchange transactions, research publication, and other activities. In the ordinary course of its business, Morgan Stanley Wealth Management therefore engages in activities where Morgan Stanley Wealth Management’s interests may conflict with the interests of its clients, including the private investment funds it manages. Morgan Stanley Wealth Management can give no assurance that conflicts of interest will be resolved in favor of its clients or any such fund.

Alternative investments involve complex tax structures, tax inefficient investing, and delays in distributing important tax information. Individual funds have specific risks related to their investment programs that will vary from fund to fund. Clients should consult their own tax and legal advisors as Morgan Stanley Wealth Management does not provide tax or legal advice.

Morgan Stanley Wealth Management is a business of Morgan Stanley Smith Barney LLC.

© 2026 Morgan Stanley Smith Barney LLC. Member SIPC. Alternative investment securities discussed herein are not covered by the protections provided by the Securities Investor Protection Corporation, unless such securities are registered under the Securities Act of 1933, as amended, and are held in a Morgan Stanley Wealth Management Individual Retirement Account.

CRC 5505781 05/26

THE ALTS REPORT - WITH BRIAN HOLZER & ALI NEST (TRANSCRIPT)

00:00:00:00 - 00:00:22:16

BRIAN HOLZER

Welcome to The Alts Report, where we explore the value of alternative investments and the trends shaping today's markets. Today, I'm pleased to welcome, Ali Nest, Head of Investment Solutions Products for Morgan Stanley Wealth Management. Over the past few years, we have seen increased adoption of alternative investments from high net worth investors.

00:00:22:19 - 00:00:43:22

This is a trend we do not expect to slow down. In fact, a recent industry study indicates alternative investments assets under management globally is expected to more than double from here over the next decade, with high net worth clients being the fastest growing segment in terms of both adoption and increasing their allocation.. So, Ali, thanks for joining us. Let's jump right in. Let's start with what are alternative investments and what role can potentially play in client portfolios?

00:01:05:05 - 00:01:35:03

ALI NEST

Thanks, Brian. Absolutely thrilled to be here today. So alternative investments include private equity, private credit, real estate, infrastructure, hedge funds, essentially everything beyond traditional stocks and bonds. Alternatives are not tied to market movements, offering unique investing opportunities, particularly during periods of market stress. They offer eligible clients an opportunity for diversification and risk adjusted returns that can help enhance the performance of a traditional equity bond portfolio.

00:01:35:05 - 00:02:11:04

Given their versatility, they can align with different financial goals. For example, portfolio diversification. As mentioned earlier, alternatives are not directly tied to market movements and aim to maintain low correlations to traditional equity markets. They can help counterbalance and reduce overall portfolio volatility. Next is growth oriented alternatives. These solutions focus on generating excess returns and wealth accumulation, often leveraging the illiquidity premium of private markets through such strategies as venture capital and leveraged buyouts.

00:02:11:07 - 00:02:37:14

Next income generation strategies. These seek higher yields and lower volatility compared with traditional fixed income investments, helping to provide current income streams and inflation hedging through such products as non-traded REITs and private credit strategies. The last one I’d touch on is tax advantaged alternatives. These are designed to alleviate tax liabilities and offer benefits such as deferred capital gains.

00:02:37:16 - 00:02:54:10

For example, we offer equity exchange funds that can help mitigate concentrated stock positions. And given these many advantages, Morgan Stanley Wealth Management’s Global Investment Committee recommends that alternatives constitute as much as 25% of a client's investment portfolio.

00:02:54:15 - 00:03:10:10

BRIAN HOLZER

So, clearly not a homogenous asset class or a one size fits all approach. Next question, in my-in my opening, I mentioned we are seeing increased adoption in high net worth portfolios within alternatives. Can you maybe expand on that and why you think that is?

00:03:10:11- 00:03:32:02

ALI NEST

Yeah, absolutely. So in today's clearly dynamic market environment, clients are increasingly aware that relying solely on public markets can mean missing significant opportunities. Reflecting this, Morgan Stanley Wealth Management is seeing impressive growth with over 250 billion in client AUM invest in alternatives, making us the largest alternatives provider on the street.

00:03:32:27 - 00:04:01:00

And I'd say there's three main factors driving this demand. First, recent market volatility has clearly exposed the increased correlation between stocks and bonds and the limits of traditional 60/40 portfolios. Second, a growing portion of the economy is shifting to private hands, and our clients are demanding access. Today, there’s one third fewer public companies than 20 years ago.

00:04:01:03 - 00:04:29:08

Companies are staying private for twice as long as they did in the past. In fact, 80% of companies that generate at least 100 million in revenue are now private. Within the credit space, bank participation as a primary lender has dropped by 60% since the mid 70s. And as for real estate, 94% is privately owned.

00:04:29:11 - 00:04:46:19

innovative structures and all the product proliferation that has been coming to the market, like registered vehicles and evergreen funds, have made alternatives more accessible with better liquidity, lower minimums, simplified reporting, streamlined tax reporting and alike.

00:04:47:07 - 00:04:58:02

BRIAN HOLZER

You touched on it briefly in your prior comments just around the platform. Maybe spend a bit of time on just, how is Morgan Stanley making alternative investments available for clients?

00:04:58:01 - 00:05:23:19

ALI NEST

Excellent question. So as an innovator and leader in alternatives, Morgan Stanley continues to focus on delivering exclusive opportunities to clients while improving access, ease of use, and liquidity across its platform. We have 300 professionals dedicated to the alternative investments business and a 45 year history of success.

00:05:23:22 - 00:05:51:13

It's a highly selective process, and each fund must pass a rigorous due diligence process. Moreover, because of the size and scale of Morgan Stanley's alternatives platform, we're able to negotiate hard on behalf of our clients. Last year, 80% of the funds we offered were exclusive first look or at improved economics. Today, we offer a menu of about 220 third party and proprietary funds across each of the different alternative asset classes.

00:05:51:20 - 00:06:15:06

And this helps us ensure that we meet the comprehensive needs of all of our clients. But really, it's not just about volume. It's about access to top tier managers who choose to work with us because of our network, quality, and platform. We're the partner of choice for the leading alternative investment managers. It's true, and it's actually very powerful. In alternatives, access and quality are everything.

00:06:15:18 - 00:06:25:07

BRIAN HOLZER

So, Ali, final question, a few of the viewers may not have made an investment in alternative investments before. Are there any considerations they should keep in mind? [FL1]

00:06:25:19 - 00:07:07:20

ALI NEST

Really important and excellent question, Brian. So, as mentioned, alternatives can add significant benefits to a portfolio. However, these products are complex. While evaluating potential return and risk is essential, so too are considerations like tax efficiency, liquidity needs, and personal preferences. Morgan Stanley's financial advisors can play a crucial role in offering insights and guidance on how alternative investments can be integrated into clients financial strategies. They can assist in navigating a complex, yet potentially rewarding asset landscape. When thoughtfully integrated, alternative investments can broaden diversification, offer exposure to differentiated strategies, and help strengthen a portfolio's long term potential.

00:07:07:26 - 00:07:32:03

BRIAN HOLZER

Ali, thank you. Great to, great to have you on, and we appreciate you all joining us for this edition of The Alts Report. To learn more about Alternative Investments and our platform at Morgan Stanley, please visit ms.com/alts or reach out to your Morgan Stanley financial advisor or private wealth advisor. We look forward to seeing you next time.

Morgan Stanley Smith Barney LLC ("Morgan Stanley Wealth Management") - IMPORTANT DISCLOSURES

Morgan Stanley Wealth Management acts as a placement agent in connection with the offering and sale of the securities of the fund to current and prospective clients of Morgan Stanley Wealth Management or its affiliates. Morgan Stanley Wealth Management will receive cash compensation for its activities as placement agent from the fund’s manager, as described in Morgan Stanley Wealth Management’s point of sale letter, if applicable. In addition, Morgan Stanley Wealth Management, its affiliates or employees, may have additional relationships with the fund’s manager, including as an investor in the fund or other investment vehicles managed by the fund’s manager or as a client of the fund’s manager. The payment of cash compensation to Morgan Stanley Wealth Management, and any additional relationships that Morgan Stanley Wealth Management or its affiliates may have with the fund’s manager or other investment vehicles managed by the fund’s manager, create material conflicts of interest for Morgan Stanley Wealth Management in its role as placement agent.

All expressions of opinion are subject to change without notice and are not intended to be a forecast of future events or results. Further, opinions expressed herein may differ from the opinions expressed by Morgan Stanley Wealth Management and/or other businesses/affiliates of Morgan Stanley Wealth Management.

Alternative investments often are speculative and include a high degree of risk. Investors could lose all or a substantial amount of their investment. Alternative investments are appropriate only for eligible, long-term investors who are willing to forgo liquidity and put capital at risk for an indefinite period of time. They may be highly illiquid and can engage in leverage and other speculative practices that may increase the volatility and risk of loss. Alternative Investments typically have higher fees than traditional investments. Investors should carefully review and consider potential risks before investing.

The sole purpose of this material is to inform, and it in no way is intended to be an offer or solicitation to purchase or sell any security, other investment or service, or to attract any funds or deposits.  Investments mentioned may not be appropriate for all clients. Any product discussed herein may be purchased only after a client has carefully reviewed the offering memorandum and executed the subscription documents. Morgan Stanley Wealth Management has not considered the actual or desired investment objectives, goals, guidelines, or factual circumstances of any investor in any fund(s). Before making any investment, each investor should carefully consider the risks associated with the investment, as discussed in the applicable offering memorandum, and make a determination based upon their own particular circumstances, that the investment is consistent with their investment objectives and risk tolerance.

As a diversified global financial services firm, Morgan Stanley Wealth Management engages in a broad spectrum of activities including financial advisory services, investment management activities, sponsoring and managing private investment funds, engaging in broker-dealer transactions and principal securities, commodities and foreign exchange transactions, research publication, and other activities. In the ordinary course of its business, Morgan Stanley Wealth Management therefore engages in activities where Morgan Stanley Wealth Management’s interests may conflict with the interests of its clients, including the private investment funds it manages. Morgan Stanley Wealth Management can give no assurance that conflicts of interest will be resolved in favor of its clients or any such fund.

Alternative investments involve complex tax structures, tax inefficient investing, and delays in distributing important tax information. Individual funds have specific risks related to their investment programs that will vary from fund to fund. Clients should consult their own tax and legal advisors as Morgan Stanley Wealth Management does not provide tax or legal advice.

Morgan Stanley Wealth Management is a business of Morgan Stanley Smith Barney LLC.

Diversification does not guarantee a profit or protect against loss in a declining financial market

© 2026 Morgan Stanley Smith Barney LLC. Member SIPC. Alternative investment securities discussed herein are not covered by the protections provided by the Securities Investor Protection Corporation, unless such securities are registered under the Securities Act of 1933, as amended, and are held in a Morgan Stanley Wealth Management Individual Retirement Account.

CRC 5331396 04/2026

00;00;00;14 - 00;00;22;20

Brian

Welcome to The Alts Report, where we explore the value of alternative investment and the trends shaping today's markets today. We are onsite at KKR Global Headquarters, and I'm pleased to have Alisa Wood, a partner at KKR, join us. Over the past decade, private markets asset under management has more than tripled, currently in the range of 18 to 20 trillion.

00;00;22;22 - 00;00;44;05

Brian

Now, most of that growth has been fueled by institutional investors. But with recent product innovation and access to alternatives improving, we've already started to see this dynamic shift and greater adoption from individual investors.

00;00;44;06 - 00;00;57;23

Brian

So, Alisa, thanks for being with us today. I appreciate you having to state your office. So maybe to start, I mentioned my opening. We've seen tremendous growth right, in alternative investments over the past decade. What's been driving that expansion and where do you think the industry is heading from here?

00;00;58;00 - 00;01;24;03

Alisa

Sure. And thanks for having me. I think it's actually pretty simple. I think what we've seen is a few different factors, some macro, some asset allocation related, and some just in terms of where capital is appreciating. You know, first and foremost, we've seen the correlation between asset classes fundamentally shift in the last decade. We've also seen a compression and started to see a compression of returns in certain asset classes, depending on different vintage years in different cycles.

00;01;24;03 - 00;01;43;00

Alisa

So early adopters into private equity and private investments realized probably 30 or 40 years ago that if you put that in an asset allocation, it winds up being as a hedge or an uncorrelated or less correlated return stream, than public equities or fixed income or things of that nature. And I think that is playing true more today than ever.

00;01;43;03 - 00;02;06;23

Alisa

I think the second piece of it is, is that companies are staying private longer, right? So they're 40% fewer public companies today. If you look at 20, 25 years ago versus today, companies, you know, back then took probably four years to go public. Today it's probably three times that. So if you want to access, you know that entire remit of different assets in different companies, you can't just invest in the public space.

00;02;07;00 - 00;02;26;06

Alisa

And then the final piece of it is, is we're seeing the public markets really be driven by a lot of AI and technology. Nothing wrong with that. But if you think about what different firms are investing in in the private space, you're actually getting a very different industry. You know, exposure, which and by the way, exposure at a different size as well.

00;02;26;07 - 00;02;34;08

Alisa

Right. When you think about where private investing is typically happening, it really does give that full diversification. So I think that's honestly what we're seeing today.

00;02;34;11 - 00;02;51;13

Brian

So let's talk a little bit about product structure right. So innovation and product structure such as semi liquid vehicles right. They've made alternatives more accessible to a broader audience. What do you think has been the most impactful developments. How have they changed the way investors use alternatives?

00;02;51;14 - 00;03;09;26

Alisa

Sure I think it's really simple actually. You know, in 50 years we've not seen the evolution of closed end funds, right. The way those, you know, pools of capital have been operating, it's literally been the same nothing in financial services and stayed the same in 50 years. Right. So this was ripe for innovation and ripe for evolution.

00;03;09;29 - 00;03;35;23

Alisa

But I don't think it's a revolution. I think it's an evolution. Right. And when you think about it, all that's happened is the inefficiencies and some of the frictional pain points, depending on the size of the client that you are, have come out of, come out of that structure. Right. So a closed end fund, you manage the operational complexity as the end investor. In an open end fund and an evergreen fund, the manager actually owns and operates that operational complexity.

00;03;35;24 - 00;04;05;00

Alisa

That's the fundamental difference. So whether it's J curve mitigation, capital call management, optimizing for you know, a higher velocity of compounding, better diversification, all of that are the benefits of of this, you know, I would say new evolved structure. It's exciting. I think it's actually creating more opportunity for folks who maybe didn't have that, that stomach for the operational complexity to actually lean in and and get that opportunity to get those same type of less correlated returns.

00;04;05;01 - 00;04;20;18

Brian

So as we've seen, the number of funds grow, right? The money flowing into them continues to grow. What should investors be considering in your mind? What will allow certain ones to stand the test of time where maybe others you need to make sure you close attention?

00;04;20;18 - 00;04;36;14

Alisa

So I think it's really simple actually. I think to be a good closed end fund investor, what do you have to be good at? You gotta be good at one thing. You got to invest well. And by the way, I don't want to downplay that. That's really hard to do. Okay, that's a high bar, but that's all you really have to do.

00;04;36;16 - 00;04;59;11

Alisa

As a, as an open end or an evergreen structure that's table stakes. Being a good investor is the basic, you know, thing that gets you in the room, but you then have to be really good at two other things, and you've got to be good at managing operational complexity, liquidity, cash management, hedging, monthly valuations. All of that takes lots of resources that if you're not going to make that investment, you can potentially get really tripped up on.

00;04;59;13 - 00;05;19;00

Alisa

And then the final piece, which I think this is probably the least understood, is do you actually have enough investment flow to feed these vehicles? Right. Like you're taking capital in on a monthly basis? It may be linear. It may not be linear. You've got to manage the ability to have redemptions on in many cases quarterly basis. Like it's complicated.

00;05;19;03 - 00;05;37;22

Alisa

Right. And so can you manage that complexity and can you actually feed it in the right way and make sure you're feeding it with, you know, the things that will generate the return versus, you know, low hanging fruit that may be less attractive. That I think is what good looks like. Now, I think that we're going to see play out in the next however many years.

00;05;37;22 - 00;05;49;27

Alisa

I think there are a lot of evergreens that have been, created over the last few years. I don't think all of them have a right to win. I don't think all of them will be successful. And I think it's really going to come down to how do you rank them on those three metrics?

00;05;50;04 - 00;06;07;24

Brian

So let's close with portfolio construction or incorporating alternatives into portfolios. What are the key considerations for implementation? How should investors think about position sizing? How should they think about liquidity management and really just overall portfolio construction around alternatives?

00;06;07;24 - 00;06;29;06

Alisa

Sure. I know it's a great point. I think at the end of the day, you got to start out with the understanding of what what should good look like if you're investing in privates or private equity. The answer is you should be able to – and this is just basic benchmarking – you should be able to deliver 500 plus basis points in some cases top quartile 500 to 700 basis points above the public markets.

00;06;29;06 - 00;06;48;29

Alisa

Now, the beauty of private equity is in periods of dislocation it's double to triple that. Right. And that's the power of this. Now how can you do that? You do that because this is all about long term capital appreciation. This is not about the quick flip right. And I think that's how you think about the liquidity management piece of it.

00;06;49;05 - 00;07;05;17

Alisa

We like to say that if you're not going to hold an evergreen for at least five years, you shouldn't invest in it right. Now that's different than a closed end, you know, fund investment that might be 10 or 12 years long. And part of it is you can pull forward the maturity of the portfolio because of that structure and compound at a higher rate.

00;07;05;17 - 00;07;16;17

Alisa

That is really exciting and interesting, but you've got to think about it in terms of long term capital appreciation. So when you set your your allocation to what you want it to be, that's the framework that you've got to think about it.

00;07;16;17 - 00;07;24;06

Brian

And I think that I think that's a great point. Right. Even though these evergreen funds offer liquidity, if you need it, you should still think about it with a much longer time horizon.

00;07;24;11 - 00;07;39;17

Alisa

Absolutely. I mean, we say this all the time, this is not a mutual fund, right? And when you think about the liquidity, the liquidity is there in case you need it. Right? The liquidity is there. So you can decide when you want to invest and when you want to redeem. Like that's one of the biggest differences in the structure.

00;07;39;23 - 00;07;56;26

Alisa

And by the way, it does give access to a whole different group of investors who wouldn't typically have been able to access closed end structures. And by the way, that's all good. But you've got to have this long term mindset, right? Because if you don't, I think you're materially going to impair the ability you're going to have to generate those returns.

00;07;56;28 - 00;08;13;06

Brian

Great, Alyssa. Thank you. Appreciate you having us. And thank you to all of you for joining this edition of the Arts Report. To learn more about Alternative Investments and our platform at Morgan Stanley, please visit ms.com/alts or reach out to your Morgan Stanley Financial Advisor or Private Wealth Advisor. We look forward to seeing you next time.

Morgan Stanley Smith Barney LLC ("Morgan Stanley Wealth Management") - IMPORTANT DISCLOSURES

Morgan Stanley Wealth Management acts as a placement agent in connection with the offering and sale of the securities of the fund to current and prospective clients of Morgan Stanley Wealth Management or its affiliates. Morgan Stanley Wealth Management will receive cash compensation for its activities as placement agent from the fund’s manager, as described in Morgan Stanley Wealth Management’s point of sale letter, if applicable. In addition, Morgan Stanley Wealth Management, its affiliates or employees, may have additional relationships with the fund’s manager, including as an investor in the fund or other investment vehicles managed by the fund’s manager or as a client of the fund’s manager. The payment of cash compensation to Morgan Stanley Wealth Management, and any additional relationships that Morgan Stanley Wealth Management or its affiliates may have with the fund’s manager or other investment vehicles managed by the fund’s manager, create material conflicts of interest for Morgan Stanley Wealth Management in its role as placement agent.

All expressions of opinion are subject to change without notice and are not intended to be a forecast of future events or results. Further, opinions expressed herein may differ from the opinions expressed by Morgan Stanley Wealth Management and/or other businesses/affiliates of Morgan Stanley Wealth Management.

Alternative investments often are speculative and include a high degree of risk. Investors could lose all or a substantial amount of their investment. Alternative investments are appropriate only for eligible, long-term investors who are willing to forgo liquidity and put capital at risk for an indefinite period of time. They may be highly illiquid and can engage in leverage and other speculative practices that may increase the volatility and risk of loss. Alternative Investments typically have higher fees than traditional investments. Investors should carefully review and consider potential risks before investing.

The sole purpose of this material is to inform, and it in no way is intended to be an offer or solicitation to purchase or sell any security, other investment or service, or to attract any funds or deposits.  Investments mentioned may not be appropriate for all clients. Any product discussed herein may be purchased only after a client has carefully reviewed the offering memorandum and executed the subscription documents. Morgan Stanley Wealth Management has not considered the actual or desired investment objectives, goals, guidelines, or factual circumstances of any investor in any fund(s). Before making any investment, each investor should carefully consider the risks associated with the investment, as discussed in the applicable offering memorandum, and make a determination based upon their own particular circumstances, that the investment is consistent with their investment objectives and risk tolerance.

As a diversified global financial services firm, Morgan Stanley Wealth Management engages in a broad spectrum of activities including financial advisory services, investment management activities, sponsoring and managing private investment funds, engaging in broker-dealer transactions and principal securities, commodities and foreign exchange transactions, research publication, and other activities. In the ordinary course of its business, Morgan Stanley Wealth Management therefore engages in activities where Morgan Stanley Wealth Management’s interests may conflict with the interests of its clients, including the private investment funds it manages. Morgan Stanley Wealth Management can give no assurance that conflicts of interest will be resolved in favor of its clients or any such fund.

Alternative investments involve complex tax structures, tax inefficient investing, and delays in distributing important tax information. Individual funds have specific risks related to their investment programs that will vary from fund to fund. Clients should consult their own tax and legal advisors as Morgan Stanley Wealth Management does not provide tax or legal advice.

Morgan Stanley Wealth Management is a business of Morgan Stanley Smith Barney LLC.

© 2026 Morgan Stanley Smith Barney LLC. Member SIPC. Alternative investment securities discussed herein are not covered by the protections provided by the Securities Investor Protection Corporation, unless such securities are registered under the Securities Act of 1933, as amended, and are held in a Morgan Stanley Wealth Management Individual Retirement Account.

CRC 5257816 03/2026

01;00;17;10 - 01;00;42;25

Speaker 1 Michael Gaviser

Welcome to the Altes Report, where we explore the value of alternative investments and the trends in the marketplace. Happy to be here in Vail, Colorado at the Morgan Stanley Are's due Diligence day, with Mike Arougheti, who's the CEO and founder of Ares. Mike, you've had so many different experiences across the landscape, whether it's private credit, private equity, sports, real estate, really a privilege for all of us to be able to spend some time talking about different market segments.

01;00;42;25 - 01;00;45;23

Speaker 1 Michael Gaviser

And your thoughts on the market in general

01;00;45;25 - 01;00;51;14

Speaker 2 Michael Arougheti

Great to be here, and thanks for the support. It's amazing to see all the advisors here engaging with us on the value of private market investing.

01;00;51;16 - 01;01;13;13

Speaker 1 Michael Gaviser

If we talk about the market, Mike, you know, we've seen studies that suggest that, you know, this is a $30 trillion market for individuals by 2030. We've seen lots of adoption in portfolios in generally across the individual market, over the last several years into alternatives. Can you give us a sense of what you think's driving that market and why we're seeing that shift?

01;01;13;15 - 01;01;58;15

Speaker 2 Michael Arougheti

Probably to think about it through two lenses. One is access and we're talking about access it's really about what is the investable market opportunity that's available to institution and institutional and, wealth clients. And it's interesting because private markets have been taking market share from the public markets pretty consistently for the last 30 years. And I think that's a function of the evolution of the capital available to support growth in the private markets and some of the structural constraints that exist in the public markets in terms of a lack of flexibility in structure or lack of accommodation for smaller companies and issuers and borrowers that have pushed people into the private market.

01;01;58;15 - 01;02;25;01

Speaker 2 Michael Arougheti

But they've had a really positive experience there, and the market has figured out how to keep them private longer. You could see that just in the shrinking number of public companies over time. You can see it in the increasing concentration of market cap in the public companies, and the public markets over time in the traded credit markets, you could see it in the average issuer size and the expansion of those markets to accommodate only the largest.

01;02;25;01 - 01;02;43;14

Speaker 2 Michael Arougheti

So there's been this big secular trend to growth in private. But when I talk about access, the challenge has always been the individual investor has not had the benefit of accessing those asset opportunities. For for years, it was the purview just of the large institutional.

01;02;43;19 - 01;02;56;02

Speaker 1 Michael Gaviser

And do you feel like it's the opportunity for return and performance and diversification? They've always been there. But maybe the structures that would allow individuals to engage haven't actually been set up yet. And that's one of the big changes.

01;02;56;02 - 01;03;30;02

Speaker 2 Michael Arougheti

Yeah So I think it's structure education both for the individual investor and the advisor and technology. And I think those three things have kind of converged at the same time to promote better access. And I think now with the products that we have, whether it's monthly or quarterly liquidity, while we still recommend that folks don't view these as traded, having a path to liquidity to the extent you need it for personal reasons or for portfolio reconstruction, I think was a real value unlock -

01;03;30;02 - 01;03;31;20

Speaker 1 Michael Gaviser

Sure-

Speaker 2 Michael Arougheti

- from a structural standpoint.

01;03;31;20 - 01;03;54;12

Speaker 1 Michael Gaviser

So shifting or drilling down a little bit more, you know, we're in a little bit different world, right rates have normalized. We're not at zero rates anymore. Then obviously real estate sensitive to that. We've also had Covid and we had office vacancies and we've had big building in multifamily. There's a lot of things going on, like how do you look at real estate today from an opportunity perspective, and what are your thoughts?

01;03;54;15 - 01;04;24;20

Speaker 2 Michael Arougheti

I think you have to always think about the real estate market between secular trends and cyclical trends. Cyclically, the entry point for real estate is very well set up. You've had an under build in the major food groups of multifamily and industrial. So we're coming into the current environment with an undersupply. You've seen a drawdown in real estate values generally across the board putting office to the side down 18 to 20%.

01;04;24;20 - 01;04;48;15

Speaker 2 Michael Arougheti

So you've kind of bottomed out. And now we're getting into a constructive rate environment, which over time will get us to a constructive cap rate environment. And you should see transaction activity pick up cyclically. Generally speaking, when we see that bottoming and we've seen it in past cycles, you tend to pick up 400 basis points or so of incremental return on the index.

01;04;48;18 - 01;05;16;07

Speaker 2 Michael Arougheti

So being being thoughtful about your entry point in real estate is a way to drive outperformance. But what's also happening is you're having major secular tailwinds in the real asset market, where global supply chains are reorganizing…

Speaker 1 Michael Gaviser

And as people start building things…

Speaker 2 Michael Arougheti

…reshoring, near shoring, friend shoring, people are building redundancies. And that's creating a lot of demand for industrial real estate.

01;05;16;11 - 01;05;43;27

Speaker 2 Michael Arougheti

You're seeing increased e-commerce penetration that's creating a secular demand for warehouses. You're seeing the proliferation of digital infra and data centers off of the industrial backbone. You have an aging population, that is changing the way that they live. You've got people who are now dealing with affordability in the housing market that are looking at the rental market as a viable alternative.

01;05;43;27 - 01;05;54;00

Speaker 2 Michael Arougheti

So you have also a lot of really interesting secular tailwinds that are promoting demand in the real estate market at a time when the cyclical uptick feels like it's well underway.

01;05;54;00 - 01;06;10;12

Speaker 1 Michael Gaviser

So that all makes a lot of sense. So maybe if we pivot we've talked a lot about, with sports in the past and the opportunities in sports and, and I think the thing that most of us know the most about is buying a team and owning the equity of the team.

01;06;10;14 - 01;06;23;07

Speaker 1 Michael Gaviser

Do you feel like there's more to the sports, kind of ecosystem than simply just owning a franchise? Is there other stuff going on that investors can, you know, gain return from? And how do you think about that landscape?

01;06;23;10 - 01;06;58;20

Speaker 2 Michael Arougheti

We were very intentional about the way that we set up our sports practice, which was to call it sports, media and entertainment. There's a lot that happens around teams and leagues, from an asset and investment opportunity perspective, that could probably take a $3 trillion teams and league market and five X it. So things like sports equipment and sports gear, ticketing platforms in stadium hospitality, around stadium real estate developments, in stadium, out of stadium…

01;06;58;20 - 01;06;59;08

Speaker 1 Michael Gaviser

Everything out side of the game.

01;06;59;09 - 01;07;30;03

Speaker 2 Michael Arougheti

Advertising youth sports as a pipeline to professional sports, college sports is now investable talent agencies so so on and so forth. So yes, the teams in the leagues are kind of at the center of the value creation, because those are the ones that create the sticky customer base. They're the ones that create the brand and the IP, and they're the ones that drive the increasing value in the unscripted content that pulls everybody up with them.

01;07;30;07 - 01;07;40;22

Speaker 2 Michael Arougheti

But if all you do is focus on equity investments in teams, you're missing this entire world of of investment that that opens up to you.

01;07;40;23 - 01;07;48;16

Speaker 1 Michael Gaviser

What is it about this market that there's so much growth behind it, when we don't really have that many different teams than we had 30 or 40 years ago?

01;07;48;23 - 01;08;14;05

Speaker 2 Michael Arougheti

The underpinning of growth is media rights. That is generally least in the major sports leagues. That is ultimately what is going to drive valuation back to media and entertainment. There's been a transformational shift in the media landscape from wired cable to over-the-top and streaming that's changing the way people are consuming content and the way that people are valuing content.

01;08;14;07 - 01;08;40;11

Speaker 2 Michael Arougheti

But if you look at the length of the media, deals are getting signed by global sports leagues and the value the underpinnings are there to support continued valuation increase. Just on what we see today. And I actually look at spending patterns and the consumer is actually shifting spending to experiences versus things. And that's sports and that's concerts and that's live events.

01;08;40;18 - 01;09;02;20

Speaker 2 Michael Arougheti

And so there's something happening there too that's detached from media, that's just behavioral that I think is, you know, fueling some of this. And then look in sports and it's funny because in sports you have people who are anxious about 10 to 15% compound annual growth. There's scarcity value. Right. There's just a limited number. To your point, they don't trade very often.

01;09;02;22 - 01;09;28;08

Speaker 2 Michael Arougheti

They are in some cases stores of value. Right. Detached from the growth in revenue that comes from media, their stores, a value of the same way that you have gold, silver, crypto where people view it as a store of value, that. So there's something that's happening in team valuations over time too, which is just the scarcity and quality of that asset is also, you know, highly differentiated.

01;09;28;12 - 01;09;44;07

Speaker 1 Michael Gaviser

Mike, thanks for joining us for The Alts Report for a great fun.

Speaker 2 Michael Arougheti

Thanks. Great fun.

Speaker 1 Michael Gaviser

Really enjoyed having you. I think we all learned a lot. And if folks want more information they can go to Morganstanley.com/alts. Or they can reach out to their financial advisor and certainly lots of different opportunities for education, as you mentioned.

01;09;44;07 - 01;09;45;01

Speaker 2 Michael Arougheti

For sure. Thanks for the support.

Morgan Stanley Smith Barney LLC ("Morgan Stanley Wealth Management") - IMPORTANT DISCLOSURES

Morgan Stanley Wealth Management acts as a placement agent in connection with the offering and sale of the securities of the Fund to current and prospective clients of Morgan Stanley Wealth Management or its affiliates. Morgan Stanley Wealth Management will receive cash compensation for its activities as placement agent from the Fund’s manager, as described in Morgan Stanley Wealth Management’s point of sale letter, if applicable. In addition, Morgan Stanley Wealth Management, its affiliates or employees, may have additional relationships with the Fund’s manager, including as an investor in the Fund or other investment vehicles managed by the Fund’s manager or as a client of the Fund’s manager. The payment of cash compensation to Morgan Stanley Wealth Management, and any additional relationships that Morgan Stanley Wealth Management or its affiliates may have with the Fund’s manager or other investment vehicles managed by the Fund’s manager, create material conflicts of interest for Morgan Stanley Wealth Management in its role as placement agent.

All expressions of opinion are subject to change without notice and are not intended to be a forecast of future events or results. Further, opinions expressed herein may differ from the opinions expressed by Morgan Stanley Wealth Management and/or other businesses/affiliates of Morgan Stanley Wealth Management.

Alternative investments often are speculative and include a high degree of risk. Investors could lose all or a substantial amount of their investment. Alternative investments are appropriate only for eligible, long-term investors who are willing to forgo liquidity and put capital at risk for an indefinite period of time. They may be highly illiquid and can engage in leverage and other speculative practices that may increase the volatility and risk of loss. Alternative Investments typically have higher fees than traditional investments. Investors should carefully review and consider potential risks before investing.

The sole purpose of this material is to inform, and it in no way is intended to be an offer or solicitation to purchase or sell any security, other investment or service, or to attract any funds or deposits.  Investments mentioned may not be appropriate for all clients. Any product discussed herein may be purchased only after a client has carefully reviewed the offering memorandum and executed the subscription documents. Morgan Stanley Wealth Management has not considered the actual or desired investment objectives, goals, guidelines, or factual circumstances of any investor in any fund(s). Before making any investment, each investor should carefully consider the risks associated with the investment, as discussed in the applicable offering memorandum, and make a determination based upon their own particular circumstances, that the investment is consistent with their investment objectives and risk tolerance.

As a diversified global financial services firm, Morgan Stanley Wealth Management engages in a broad spectrum of activities including financial advisory services, investment management activities, sponsoring and managing private investment funds, engaging in broker-dealer transactions and principal securities, commodities and foreign exchange transactions, research publication, and other activities. In the ordinary course of its business, Morgan Stanley Wealth Management therefore engages in activities where Morgan Stanley Wealth Management’s interests may conflict with the interests of its clients, including the private investment funds it manages. Morgan Stanley Wealth Management can give no assurance that conflicts of interest will be resolved in favor of its clients or any such fund.

Alternative investments involve complex tax structures, tax inefficient investing, and delays in distributing important tax information. Individual funds have specific risks related to their investment programs that will vary from fund to fund. Clients should consult their own tax and legal advisors as Morgan Stanley Wealth Management does not provide tax or legal advice.

Morgan Stanley Wealth Management is a business of Morgan Stanley Smith Barney LLC.

© 2026 Morgan Stanley Smith Barney LLC. Member SIPC. Alternative investment securities discussed herein are not covered by the protections provided by the Securities Investor Protection Corporation, unless such securities are registered under the Securities Act of 1933, as amended, and are held in a Morgan Stanley Wealth Management Individual Retirement Account.

CRC 5173532 02/2026

n/a