DEFINITION of 'Optimized Portfolio As Listed Securities - OPALS'

A set of exchange-traded funds, created by Morgan Stanley in 1994, that trades on the Luxembourg Stock Exchange. Optimized Portfolio as Listed Securities (OPALS) are available for many of the different Morgan Stanley Capital International (MSCI) indexes. They are generally unavailable to the majority of U.S. investors, because they are not registered with the SEC. Certain OPALS allow U.S. institutional investors to participate; however a $100 million minimum investment is required.

BREAKING DOWN 'Optimized Portfolio As Listed Securities - OPALS'

OPALS are often seen as one of several predecessors to the introduction of exchange-traded funds in the U.S. OPALS were introduced on the Luxembourg Stock Exchange because its less restrictive rules allowed Morgan Stanley to offer the shares to retail investors. In 1996, Morgan Stanley introduced World Equity Benchmark Shares (WEBS). These were SEC-registered units, similar to OPALS and available to U.S. retail investors.

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