Some Funds May Lose Their Spot as MSSB Tidies Up Its Shelf Space
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Tuesday, November 02, 2010

Some Funds May Lose Their Spot as MSSB Tidies Up Its Shelf Space

The gatekeepers at MSSB are working on a more select line-up of products for its 2011 asset management collection. Morgan Stanley Smith Barney plans to further reduce the number of investment products on its platform. The wirehouse is cutting the number of investment products it distributes from 1,300 to 1,000, revealed Paul Hatch, head of investment strategy at MSSB, in an interview with The MFWire.

MSSB's decision may break hearts at some fund firms that lose spots the wirehouse's shelves, Hatch acknowledged before affirming that MSSB's role is to serve its clients first.

"We have 1,300 choices on our platform," Hatch told The on the sidelines of Fund Forum 2010 at Marriott Long Wharf in Boston Tuesday morning. "Our goal right now is 1,000. That's just an interim goal. I would expect that over time, the number is going to come down even further."

The seemingly ubiquitous Hatch -- he spoke at the IRI Annual Meeting in Chicago Monday last week, the MFWire/FUSE Research Network Summit in Boston the following day and Fund Forum 2010 this morning -- said MSSB has started the process of getting the number down to 1,000. He did not say when the firm intends to get there.

The combined Morgan Stanley and Smith Barney platform initially had 1,600 investment products, including mutual funds and SMAs.

"We knew going into it that we would look at the menu and decide ultimately that we would want to have fewer than we initially had with the combined platform," he said.

"We want a higher level of due diligence," Hatch added. "Before, it was about how many we can get on the platform."

MSSB's job, he said, "is to protect our clients. We can't say we're doing that when our objective is 'How many choices can we get on the platform?' as opposed to 'What are the right choices?"

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