Morgan Stanley, founded in 1935, is one of the most respected financial institutions in the world. It is active in investment banking, underwriting, lending, and asset management. At the end of 2021, Morgan Stanley had $6.5 trillion in client assets, including $4.9 trillion in wealth management assets under management. The company employs more than 70,000 employees across offices in 40 countries. In addition to the Morgan Stanley branded wealth and asset management, Morgan Stanley also purchased online broker E*TRADE in 2020, which added 5.2 million customer accounts and $360 billion in assets to Morgan Stanley’s Wealth Management division.
While Morgan Stanley looks to establish personal relationships with high-net-worth clients for its wealth management offerings, Morgan Stanley’s Access Investing is a robo-advisor designed for affluent investors and others who want professional money management but don’t want to pay higher fees to work with a Morgan Stanley advisor. Access Investing provides investors with the ability to invest thematically, such as in environmentally friendly companies or industry-specific investments. We’ll dig deeper into Access Investing to help you decide whether it's the right fit for your portfolio needs.
- Access Investing is backed by an established and respected financial institution in Morgan Stanley.
- There are multiple thematic investment options available through Access Investing, such as environmentally responsible, inflation conscious, and other socially responsible or industry-specific choices.
- The $5,000 minimum investment amount is much higher than other robo-investing offerings.
- Access Investing has no option to access advisors, limited support, and no chat feature.
Easy account setup and funding
Intuitive online and mobile platforms
Multiple thematic investment options
Portfolios have a balance of both actively and passively managed ETFs and mutual funds
Requires a high minimum investment of $5,000
Lack of transparency on fees and expense ratios
Weak financial planning tools
No access to advisors
|Goal Setting||Retirement; Wealth Building; Goals (education, house, car, wedding, starting a business, or any other user-named goal)|
|Available Assets||ETFs and Mutual Funds|
|Interest Paid on Cash Balances||0.0%|
|View Portfolio before Funding||Yes|
|Customer Service||Support only; general support 24/7; Access Investing support from 8:30 AM to 7:30 PM EST|
|Financial Advisor Available||No|
|Cash Management||No cash management feature|
|External Account Sync/Consolidation||No|
|Mobile App||Android, iOS|
It is not easy to find Access Investing through the Morgan Stanley website. Once found, however, the account setup and opening process is easy and open to everyone whether you are an existing Morgan Stanley customer or not. Access Investing requires a $5,000 initial investment that is higher than many other robo-advisors. As a true automated investing account, there is no access to financial advisors to assist with the portfolio. The entire account opening process is done online and, while portfolios are not customizable, they can be seen prior to funding and adjusted based on time frame or goal. You can set up an account with only your name and email address to view a portfolio tailored to your stated goal, but you need to fully set up and fund your account or it expires in 90 days.
As with many robo-advisors, Access Investing setup begins with you answering questions about the primary purpose of the account, with the choices of building wealth, retirement, or saving for something in particular, such as for education, a house, a car, a wedding, starting a business, or any other user-defined reason. For wealth building, you are asked to provide the initial investment and subsequent contribution amounts. For user-defined goals, you provide the dollar goal and the time horizon. With a retirement account, you are asked if it is for just you or for you and a partner. The retirement account track also asks questions about age, income, and initial and subsequent investment amounts before calculating an anticipated retirement income for your goal. The pages are very clean, but the site also contains links that bring up useful pop-ups providing explanations on what is being done and how information is used to generate a portfolio.
Once the primary purpose of the account is established, you are asked if your risk tolerance is conservative, moderate, or aggressive, and also offered a brief questionnaire to help you decide which risk tolerance is best. After the risk tolerance questions, you decide between three investment objectives: outperforming the market, socially responsible investing, and lower cost investing. The lower cost investing option invests in an all-ETF tracking portfolio that tracks a blended market index using more passive ETFs that have lower fees. The socially responsible investing objective can be used without an additional theme, or a portion of the portfolio can be invested to address climate action or gender diversity. The outperform the market objective has six available themes, including:
- Defense and cybersecurity
- Genomics and biomedicine
- Emerging consumer
- Robotics, data, and artificial intelligence
- Global frontier
- Inflation conscious
Goal planning on Morgan Stanley’s Access Investing is not as robust as some of its competitors. To make the account opening process easy for younger investors to understand, Morgan Stanley provides a more rudimentary goal planning platform. The planning options are very basic, with goals that would be typical of younger investors like paying for a wedding, buying a car or house, college savings, or starting a business, in addition to mainstays like retirement planning and wealth building. You can only have one goal and target date when many of these goals are done in parallel.
Morgan Stanley does not provide advisors to assist with this all-important account setup, so it appears that multiple Access Investing accounts would be needed to meet multiple goals with different time horizons. A more robust questionnaire allowing for multiple goals and tracking within a single account would be much more meaningful for new investors. A financial advisor would be looking to incorporate multiple goals into a comprehensive portfolio, so Morgan Stanley should strive to offer a similar experience for the higher net worth clients they hope to target with Access Investing.
Automatic deposits are easy to set up and manage, and withdrawing funds is similarly straightforward. Access Investing clients are not able to trade on margin, borrow against their accounts, purchase stocks outside of the automated portfolio management system, or access cash management features within the account.
Morgan Stanley does not offer cash management services within Access Investing accounts. Cash held in portfolios is swept into FDIC-insured deposit accounts, but these accounts don’t include check writing or other cash management features available to other Morgan Stanley clients. Further, Morgan Stanley receives payment for order flow for these cash prices, likely resulting in lower interest rates. While any Morgan Stanley account holder can open a cash management account, they are separate from the Access Investing account and require a monthly minimum deposit of $5,000 and an average account balance of $25,000 or more. There are many robo-advisors offering cash management with much lower (or no) barriers to entry.
As outlined earlier, Morgan Stanley Access Investing provides many portfolio options. After choosing a risk tolerance between aggressive, moderate, and conservative, there are choices for the portfolio that include outperforming the market, socially responsible investing, and also a lower cost option market-tracking portfolio. Up to 30% of the investments in the portfolio will align to the theme selected by the investor. Morgan Stanley creates all the Access Investing portfolios using ETFs, mutual funds, and cash
Morgan Stanley goes further in terms of choices with the outperforming and socially responsible investing options, while the low cost option does not have sub-themes to choose from. Within a socially responsible portfolio, you can choose a sub-theme of climate action or gender diversity. The outperform market portfolios allow for thematic investment options too, including defense and cybersecurity, genomics and biomedicine, emerging consumer, robotics, data, and artificial intelligence, global frontier, and inflation-conscious themes.
This provides the investor with many options for setting up their portfolio. However, like many robo-advisor platforms, the choices are binary and ultimately limited because these investors can’t choose multiple thematic investing options. You can’t combine defense and the robotics, data, and artificial intelligence theme for example. That said, Morgan Stanley gets points for flexibility with its multiple portfolio creation options.
|Fixed Income||No (only through ETFs and mutual funds)|
|Socially Responsible or ESG Options||Yes (ETFs and mutual funds only)|
Morgan Stanley creates all the portfolios and does the due diligence on the funds and managers they use for the ETFs, mutual funds, and cash investment strategies that make up the portfolio. Monte Carlo simulations are utilized determining statistical probabilities for the portfolios. Morgan Stanley uses algorithms to construct the asset allocation decisions for all their investment advisory services.
The investment models used for the portfolios, listed by most conservative to most aggressive, are as follows:
- The Wealth Conservation model prioritizes preservation and purchasing power, with a benchmark that consists of 55% Bloomberg Barclays Capital US Aggregate Bond Index; 35% MSCI All Country World Index; net 10% 90-Day T-Bills.
- The Income model looks to generate steady income for people that are moderately conservative and uses as its benchmark 55% Bloomberg Barclays Capital US Aggregate Bond Index; 35% MSCI All Country World Index; and 35% MSCI All Country World Index; net 10% 90-Day T-Bills.
- Balanced Growth is Access Investing’s middle-of-the-road strategy, using 45% Bloomberg Barclays Capital US Aggregate Bond Index; 50% MSCI All Country World Index; net 5% 90-Day T-Bills for its benchmark.
- The Market Growth Model is one of the more aggressive allocations for clients who have a moderate-to-aggressive risk and moderate to high volatility, and benchmarks to 35% Bloomberg Barclays Capital US Aggregate Bond Index and 65% MSCI All Country World Index.
- The most aggressive allocation, appropriate for those with high risk and volatility tolerance, is the Opportunistic Growth model benchmarked to 20% Bloomberg Barclays Capital US Aggregate Bond Index and 80% MSCI All Country World Index.
Portfolio customization is only permitted in so far as the customer can alter the portfolio through their choices for the portfolio type and the portfolio’s underlying theme.
Portfolios are monitored daily. Rebalancing occurs monthly or more frequently if needed, and a 5% divergence in the model is considered sufficient drift for rebalancing. You cannot request a rebalance, but a rebalance would occur if you altered your portfolio selections.
Tax-loss harvesting is available on Access Investing accounts, and it can be coordinated across multiple Access Investing accounts. The tax-loss harvesting does not, however, take other Morgan Stanley accounts held outside Access Investing into consideration.
Key Portfolio Management Features
|Automatic Rebalancing||Monthly or more (accounts monitored daily). Drift is generally considered 5% or more different than the portfolio model’s target allocation.|
|Reporting Features||Quarterly reports unless the investor makes portfolio changes or there is a rebalancing event. Notices about goals being on track are provided on the account website, but there are no push notifications.|
|Tax-Loss Harvesting||Yes (limited to Access Investing accounts only).|
|External Account Syncing/Consolidation||No|
Morgan Stanley’s Access Investing is easy to start and use on an ongoing basis. The interface has a clean and somewhat minimalist look and feel. While the layout is sparse, there are pop-ups available on the pages so investors can get more information. Users can quickly find their accounts and make changes to their portfolios. When logging onto the site, you see notices related to whether the portfolio is on track to meet your goal, as well as suggestions to improve your chances of success like increasing deposits or making other changes to your portfolio.
The mobile app experience with Morgan Stanley’s Access Investing is nearly identical to the desktop experience, with some minor changes in layout to accommodate a mobile experience. The graphics, pictures, setup process, and supporting information are presented in the same easy-to-use interface as the desktop version.
Customer service for Morgan Stanley Access Investing accounts is sparse. There is 24/7 access for general account issues, such as login issues or basic account access. There is a dedicated support group for Access Investing, but they are only available during the week from 8:30 AM to 7:30 PM EST and the hours were not provided on the website. There is no chat or chatbox option for support. There is a frequently asked questions page for Access Investing, but it wasn’t functional during our testing.
Access Investing support is limited to answering questions about the account and the process for setting up the account. No financial advisors are available to speak to the portfolio composition of client financial needs.
Morgan Stanley’s Access Investing platform provides security features that include:
- Multi-factor authentication utilizes device registration, one-time security codes, authenticator apps, push notifications, security keys, and sends alerts and notifications to verify password changes and other actions
- Biometric login on mobile
- Accounts are secured beyond Securities Investor Protection Corporation (SIPC) insurance through supplemental policies and Morgan Stanley accounts are also protected by cyber insurance and fraud insurance for unauthorized online access through no fault of the investor.
Morgan Stanley has had some reported data breaches. One was in 2019, where encrypted discs that could have included personally identifying information could not be located after they were replaced in their system. There was also a 2016 data breach impacting over 14 million customers as a result of the company failing to properly retire older equipment; while denying wrongdoing, Morgan Stanley reached a $60 million settlement agreement for this in January 2022.
The educational content available on Access Investing is basic and designed to help customers understand the reasons behind the survey questions and how the different answers would impact the final portfolio selected. Once you open an account, however, you have access to other Morgan Stanley research and content.
Commissions & Fees
Commissions and fees for Morgan Stanley’s Access Investing program are not as competitive as other robo-advisor platforms. Morgan Stanley lowered their fee from 0.35% to 0.30% annually (paid quarterly) on assets under management which is still higher than other platforms. Also, Access Investing still has a $5,000 account minimum that is significantly higher than most robo-advisor platforms. Moreover, there are no discounts to the 0.30% management fee for having a larger account.
The bigger question, however, are the ETF expense ratios and mutual fund fees associated with the many non-proprietary investment options available through the Access Investing platform. While the tracking model is the least expensive because it consists primarily of index tracking investments, fees for more actively managed and specialty funds can be considerably higher.
Morgan Stanley indicates their fees are on the higher end of the range, but they would not provide any information on average account fees in excess of the 0.30% management fee other than suggesting that customers request a prospectus for each fund in a portfolio to learn about their fees. Additional fees in addition to a higher management fee can very quickly eat into the long-term returns of a portfolio.
|Management fees for $5,000 account||0.3% annually, paid quarterly|
|Management fees for $25,000 account||0.3% annually, paid quarterly|
|Management fees for $100,000 account||0.3% annually, paid quarterly|
|Expense ratios||Unavailable; on the high end (MS would not provide any info on this, even ranges; they acknowledge in their survey to us that their fees are on the high end). The investor would have to look up each individual portfolio holding; MS website advises to request a prospectus for each fund.|
|Mutual funds||Unavailable; on the high end (MS would not provide any info on this, even ranges; they acknowledge in their survey to us that their fees are on the high end). The investor would have to look up each individual portfolio holding; MS website advises to request a prospectus for each fund.|
Morgan Stanley’s Access Investing platform is well-designed and offers investors options for thematic investing and a choice of active, passive, and hybrid management styles in portfolios, as well as tax-loss harvesting. The portfolios appear to be well thought out. However, it is a more expensive robo-advisor platform than competitors' offerings. While there is a high $5,000 minimum investment and somewhat high 0.30% management fee, the high expense ratios for ETFs and mutual funds in the program are concerning for a long-term investment platform.
It is one thing to choose a higher cost option if they provide superior returns or services, but higher fees for less performance is a bad combination—especially when there is no access to advisors. While newer investors who are on track for a high-net-worth may want to start off at the Morgan Stanley basic service before eventually moving on to personal advising services, investors interested in robo portfolios probably want to look elsewhere. Other platforms offer similar services for lower fees and fund expense ratios, while still offering account amenities such as tax-loss harvesting and goal monitoring.
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Morgan Stanley. "Access Investing."