Crane Data Subscribers
Morgan Stanley's Money Funds Ask SEC to Perform Principal Transactions. A recent SEC filing for Morgan Stanley's money market mutual funds has requested an "order to permit the Funds to engage in principal transactions in certain money market instruments with MS & Co." Morgan Stanley follows a number of other fund advisors with affiliated broker-dealers, such as Goldman Sachs, in requesting permission for its funds to purchase money market securities from its dealer. The filing says, "[T]he Advisers and MS & Co. are functionally indepdendent" and that "MS & Co. is one of the world's largest dealers in Taxable Money Market Instruments". Morgan Stanley is among the top 10 repurchase agreement dealers, is one of 22 primary Treasury dealers, is the "fifth largest manager of MTN (medium-term note) programs", and is "a major participant in both the primary new issue market and in the secondary dealer market for Tax-Exempt Money Market Instruments," says the application. Following consolidation in the dealer community, some money funds have had difficulty obtaining competitive bids when excluding their own affiliated broker-dealers.
