3-star brokerage rating

Morgan Stanley Wealth Management Account Review

Morgan Stanley review of wealth management account 2019: full service brokerage rating, investing commissions and fees, managed account minimum, online trading costs, and IRA fees.

Morgan Stanley Wealth Management

Morgan Stanley Wealth Management is the full service brokerage arm of the Investment Bank Morgan Stanley.

Morgan Stanley Account Minimum Balances

One of the first things that potential clients will notice about Morgan Stanley Wealth Management is the fact that they will need to have $250,000 in investable assets in order to qualify for an account. While this initial balance seems high, the $250,000 minimum is actually calculated using the balances of the totals of the “household.” To make up the full $250,000, Morgan Stanley Wealth Management adds in free cash, mutual funds, equities, bonds, CD’s in all taxable and IRA accounts that are held by the customer’s grouped accounts. Domestic partners, married couples, and minor children are used to determine the total of the client’s “householded accounts.”

Morgan Stanley High Net Worth Team Approach

While many of the newer Financial Advisor Associates are individual advisors acting with the support of a back office and branch management, most Morgan Stanley clients will find that their Financial Advisors are actually working with the Team Approach. These Teams, called “Groups” consists of two or more Financial Advisors who each specialize in one aspect of offering the client Wealth Management. While not costing more, the Team Approach proves to be a very effective tool. Clients will find Morgan Stanley Teams very knowledgeable, professional, and often times very “market seasoned.” At the price that Morgan Stanley charges for their services, they in turn, offer a feeling that client’s money is almost “institutional” in nature. While Morgan Stanley offers more of a “Private Banking” feel, some of its competitors, such as Merrill Lynch, offer an almost “Mass Market” feel.

Morgan Stanley’s best clients are those that enjoy a mathematical, technical approach to keeping their money safe, as many of the Teams include Chartered Financial Analysts, as well as Certified Financial Planners, etc., which are Professional Designations and Certifications that go well beyond the basic required Series 7 Exam that other Brokerages require.

Morgan Stanley Investment Choices are Wide, but Typical

To the seasoned High Net Wealth client, Morgan Stanley’s Wealth Advisors will find the products to be the typical sort offered by U.S. based Wealth Management firms. The client with a household balance of $250,000 will find that they are advised that funds be diversified among mainstream mutual fund families such as American Funds, Vanguard, Fidelity, etc. Suggested investments will usually be of the “balanced portfolio” type of a mix of bonds, money market and equity mutual funds. Other than the individual monthly and quarterly rebalancing, at the $250,000 portfolio value investments will be plain vanilla, with the most exotic investment possibly emerging markets ETF.

Clients who would like to tap into Morgan Stanley’s well known relationships with some of the world’s best run Hedge Fund managers will be disappointed. Alternative Investment vehicles such as Managed Futures funds and Hedge Funds will most likely be only offered to those with financial assets of $1 million plus. To those who are disappointed with this news, it is best to remember that Morgan Stanley is one of the more conservative brokerages and Wealth Advisors available to U.S. clients.

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Morgan Stanley Fees

There are two types of pricing schemes at Morgan Stanley Wealth Management. The first is the typical and well known model of “pay as you trade.” Equity trades will cost the client anywhere from $50 - $95 depending upon lot size. While cheaper than some other full service firms, the cost is still much more expensive than at discount brokerage firms such as TD Ameritrade with $6.95 rate. Keep in mind that the price of the trade has to be built into the cost basis of the equity 2x, as the client is charged for both a buy and a sell. Margin is offered up to the current legal limit, but rates are not very competitive.

The second pricing scheme is what is known as the “Wrap Account.” Wrap accounts will cost the client 1% of the total household account value annually. The Wrap Account offers the client the ability to buy and sell mutual funds, bonds, and equities for no cost as frequently as needed. But the cost of this service on a $250,000 account will be $2,500 annually.

Morgan Stanley Stock Commission

Lower Cost Alternatives

For investors who don't want to spend so much money on Morgan Stanley's fees there are a number of options available. First, they can open a brokerage account at one of the top rated brokerage houses in the country, such as TD Ameritrade, Fidelity or Schwab and invest in conservative mutual funds and ETFs. Second, if they want a professional portfolio management for a fraction of the cost charged by Morgan Stanley than Ally Managed Portfolios with their low 0.30% fee is a great option.

Morgan Stanley Review Recap

Overall, Morgan Stanley Wealth Management is a decent broker. The client’s individual team or Financial Advisor is the real face of the company, backed by the Morgan Stanley’s institutional perspective.

Morgan Stanley reviewed by Brokerage-Review.com. Rating: 3