Obligation Morgan Stanley Financial 0% ( US61768CX774 ) en USD

Société émettrice Morgan Stanley Financial
Prix sur le marché 100 %  ⇌ 
Pays  Etas-Unis
Code ISIN  US61768CX774 ( en USD )
Coupon 0%
Echéance 05/06/2023 - Obligation échue



Prospectus brochure de l'obligation Morgan Stanley Finance US61768CX774 en USD 0%, échue


Montant Minimal 1 000 USD
Montant de l'émission /
Cusip 61768CX77
Notation Standard & Poor's ( S&P ) N/A
Notation Moody's N/A
Description détaillée Morgan Stanley est une firme mondiale de services financiers offrant des services de banque d'investissement, de gestion de placements, de courtage et de gestion de patrimoine à une clientèle institutionnelle et privée.

L'Obligation émise par Morgan Stanley Financial ( Etas-Unis ) , en USD, avec le code ISIN US61768CX774, paye un coupon de 0% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 05/06/2023







424B2 1 dp91867_424b2-ps550.htm FORM 424B2
CALCULATION OF REGISTRATION FEE



Maximum Aggregate

Amount of Registration
Title of Each Class of Securities Offered

Offering Price

Fee
Jump Notes with Auto-Callable Feature

$500,000

$62.25
due 2023





M a y 2 0 1 8
Pricing Supplement No. 550
Registration Statement Nos. 333-221595; 333-221595-01
Dated May 31, 2018
Filed pursuant to Rule 424(b)(2)
Morgan Stanley Finance LLC
STRUCTURED INVESTMENTS
Opportunities in Equities, Bonds and Alternative Investments
Jump Notes with Auto-Callable Feature due June 5, 2023
Ba se d on t he V a lue of t he M orga n St a nle y M AP T re nd I nde x
Fully a nd U nc ondit iona lly Gua ra nt e e d by M orga n St a nle y
The notes are unsecured obligations of Morgan Stanley Finance LLC ("MSFL") and are fully and unconditionally guaranteed by Morgan Stanley. The notes
will pay no interest and will have the terms described in the accompanying product supplement and prospectus, as supplemented and modified by this
document. The notes will be automatically redeemed if the index closing value on any annual determination date is greater than or equal to the then-
applicable redemption threshold level (which will increase over the term of the notes), for an early redemption payment that will increase over the term of the
notes and that will correspond to a return of approximately 9.00% per annum, as described below. No further payments will be made on the notes once they
have been redeemed, and the investor will not participate in any appreciation of the underlying index if the notes are redeemed early. At maturity, if the notes
have not previously been redeemed and the final index value is greater than the initial index value, investors will receive the state principal amount plus 1-
to-1 upside performance of the underlying index. However, if the notes are not automatically redeemed prior to maturity and the final index value is less
than or equal to the initial index value, investors will receive only the stated principal amount of their investment, without any positive return on the notes.
The Morgan Stanley MAP Trend Index (the "underlying index") was established by Morgan Stanley on March 7, 2017 and employs a rules-based quantitative
strategy (the "Index Methodology") that combines a risk-weighted approach to portfolio construction with a momentum-based, or trend-following, asset
allocation methodology to construct a notional portfolio. In addition, the strategy imposes an overall volatility-targeting feature upon the resulting portfolio.
The goal of the underlying index is to seek positive return opportunities in different market environments based upon recent trends in the underlying assets.
The investment assumption underlying the allocation strategy is two-fold: that historical volatility of the underlying assets can be used to risk-weight a
portfolio, and that past trends are likely to continue to be a good indicator of the future performance of that portfolio
The components of the underlying index consist of (i) 20 U.S.-listed exchange traded funds ("ETFs"), representing U.S. and non-U.S. equities, fixed income
securities, commodities and real estate, and (ii) the Morgan Stanley Two Year Treasury Index (collectively, the "Index Components"). The notional portfolio
constructed by the Index Methodology of Index Components is referred to as the "Asset Portfolio." The Asset Portfolio will consist of long-only positions in
each Index Component, and each Index Component except for the Morgan Stanley Two Year Treasury Index is subject to a maximum exposure cap. The
targeted volatility for the underlying index is 5% (the "Volatility Target").
The underlying index is rebalanced each Strategy Business Day (the "Daily Rebalancing"). Upon each Daily Rebalancing for the underlying index, the Index
Methodology uses the pre-assigned Risk Budget assigned to each ETF (as set forth under "Annex A ­ Morgan Stanley MAP Trend Index ­ Index
Components") and the volatility for each ETF to make initial base allocations. The Index Methodology then calculates a signal based on the upward or
downward trend of each ETF (the "Trend Signal"). The index calculates each Trend Signal by observing two moving averages, one short-term and one long-
term, over different look-back periods for each respective ETF. A Trend Signal that converges toward one indicates an upward trend and a Trend Signal
that converges toward zero indicates a downward trend. Once the Trend Signal is calculated for each ETF, the previously determined base allocations are
scaled by the Trend Signal by allocating more upward-trending securities to the Asset Portfolio. The magnitude of each position taken by the underlying
index following the Trend Signal adjustment is then scaled to the Volatility Target based on a pro-rata volatility-scaling that seeks to achieve a balanced level
of volatility in the underlying index's exposure to each of the ETFs.
The underlying index is calculated on an excess return basis, and therefore the level reflects the weighted return of the Asset Portfolio reduced by the return
on an equivalent cash investment receiving the 3-month LIBOR. The underlying index performance is further reduced by a servicing cost of 0.85% per
annum calculated on a daily basis. For more information, see "Annex A--Morgan Stanley MAP Trend Index" beginning on page 26 and the "Risk Factors"
beginning on page 9.
These long-dated notes are for investors who are concerned about principal risk but seek exposure to a multiple asset-linked index, who are willing to
accept that the underlying index's Volatility Target feature may reduce upside performance in bullish markets, and who are willing to forgo current income in
exchange for the possibility of receiving an early redemption payment or payment at maturity greater than the stated principal amount if the underlying index
closes at or above the applicable redemption threshold level or above the initial index value, as applicable, on an annual determination date. The notes are
notes issued as part of MSFL's Series A Global Medium-Term Notes program.
All pa ym e nt s a re subje c t t o our c re dit risk . I f w e de fa ult on our obliga t ions, you c ould lose som e or a ll of your inve st m e nt .
T he se not e s a re not se c ure d obliga t ions a nd you w ill not ha ve a ny se c urit y int e re st in, or ot he rw ise ha ve a ny a c c e ss t o, a ny
unde rlying re fe re nc e a sse t or a sse t s.
FI N AL T ERM S
I ssue r:
Morgan Stanley Finance LLC
Gua ra nt or:
Morgan Stanley
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I ssue pric e :
$1,000 per note (see "Commissions and issue price" below)
St a t e d princ ipa l
$1,000 per note
a m ount :
Aggre ga t e princ ipa l
$500,000
a m ount :
Pric ing da t e :
May 31, 2018
Origina l issue da t e :
June 5, 2018 (3 business days after the pricing date)
M a t urit y da t e :
June 5, 2023
I nt e re st :
None
U nde rlying inde x :
Morgan Stanley MAP Trend Index
Ea rly re de m pt ion:
If, on any annual determination date (other than the final determination date), the index closing value of the underlying index
is gre a t e r t ha n or e qua l t o the then-applicable redemption threshold level, the notes will be automatically redeemed for
the applicable early redemption payment on the related early redemption date. No further payments will be made on the
notes once they have been redeemed.
Ea rly re de m pt ion
The early redemption payment will be an amount in cash per stated principal amount (corresponding to a return of
pa ym e nt :
approximately 9.00% per annum) for each annual determination date, as follows:

1st determination date: $1,090
2nd determination date: $1,180
3rd determination date: $1,270
4th determination date: $1,360

No further payments will be made on the notes once they have been redeemed.
Re de m pt ion t hre shold
1st determination date:
224.209, which is approximately 102.50% of the initial index value
le ve ls:

2nd determination date:
229.677, which is 105.00% of the initial index value

3rd determination date:
235.146, which is approximately 107.50% of the initial index value

4th determination date:
240.614, which is 110.00% of the initial index value
Pa ym e nt a t m a t urit y:
If the notes have not previously been redeemed, you will receive at maturity a cash payment as follows:
· If the final index value is greater than the initial index value:
$1,000 + ($1,000 x index percent change)
· If the final index value is less than or equal to the initial index value:
$1,000
Est im a t e d va lue on t he $966.60 per note. See "Investment Summary" beginning on page 3.
pric ing da t e :
Com m issions a nd
issue pric e :
Pric e t o public (1)
Age nt 's c om m issions(2)
Proc e e ds t o us (3)
Pe r not e
$1,000
$12.50
$987.50
T ot a l
$500,000
$6,250
$493,750
(1)
The notes will be sold only to investors purchasing the notes in fee-based advisory accounts.
(2)
MS & Co. expects to sell all of the notes that it purchases from us to an unaffiliated dealer at a price of $987.50 per note, for further sale to certain
fee-based advisory accounts at the price to public of $1,000 per note. MS & Co. will not receive a sales commission with respect to the notes. See
"Supplemental information regarding plan of distribution; conflicts of interest." For additional information, see "Plan of Distribution (Conflicts of Interest)"
in the accompanying product supplement.
(3)
See "Use of proceeds and hedging" on page 23.
T he not e s involve risk s not a ssoc ia t e d w it h a n inve st m e nt in ordina ry de bt se c urit ie s. Se e "Risk Fa c t ors"
be ginning on pa ge 9 .
T he Se c urit ie s a nd Ex c ha nge Com m ission a nd st a t e se c urit ie s re gula t ors ha ve not a pprove d or disa pprove d t he se not e s, or
de t e rm ine d if t his doc um e nt or t he a c c om pa nying produc t supple m e nt a nd prospe c t us is t rut hful or c om ple t e . Any
re pre se nt a t ion t o t he c ont ra ry is a c rim ina l offe nse .
T he not e s a re not de posit s or sa vings a c c ount s a nd a re not insure d by t he Fe de ra l De posit I nsura nc e Corpora t ion or a ny
ot he r gove rnm e nt a l a ge nc y or inst rum e nt a lit y, nor a re t he y obliga t ions of, or gua ra nt e e d by, a ba nk .
Y ou should re a d t his doc um e nt t oge t he r w it h t he re la t e d produc t supple m e nt a nd prospe c t us, e a c h of w hic h c a n be
a c c e sse d via t he hype rlink s be low . Ple a se a lso se e "Addit iona l I nform a t ion About t he N ot e s" a t t he e nd of t his doc um e nt .
As use d in t his doc um e nt , "w e ," "us" a nd "our" re fe r t o M orga n St a nle y or M SFL, or M orga n St a nle y a nd M SFL c olle c t ive ly, a s
t he c ont e x t re quire s.
Produc t Supple m e nt for Equit y-Link e d N ot e s da t e d N ove m be r 1 6 , 2 0 1 7 Prospe c t us da t e d N ove m be r 1 6 , 2 0 1 7


Morgan Stanley Finance LLC
Jump Notes with Auto-Callable Feature due June 5, 2023
https://www.sec.gov/Archives/edgar/data/895421/000095010318007029/dp91867_424b2-ps550.htm[6/5/2018 10:21:09 AM]


Ba se d on t he V a lue of t he M orga n St a nle y M AP T re nd I nde x
Terms continued from previous page:
I nde x pe rc e nt c ha nge :
(final index value ­ initial index value) / initial index value
I nit ia l inde x va lue :
218.74, which is the index closing value on the pricing date
Fina l inde x va lue :
The index closing value on the final determination date
De t e rm ina t ion da t e s:
1st determination date: May 31, 2019
2nd determination date: June 1, 2020
3rd determination date: June 1, 2021
4th determination date: May 31, 2022
Final determination date: May 31, 2023

The determination dates are subject to postponement for non-index business days and certain market disruption events.
Ea rly re de m pt ion da t e s: The third business day following the relevant determination date
CU SI P:
61768CX77
I SI N :
US61768CX774
List ing:
The notes will not be listed on any securities exchange.
Age nt :
Morgan Stanley & Co. LLC ("MS & Co."), an affiliate of MSFL and a wholly owned subsidiary of Morgan Stanley. See
"Supplemental information regarding plan of distribution; conflicts of interest."
May 2018
Page 2
Morgan Stanley Finance LLC
Jump Notes with Auto-Callable Feature due June 5, 2023
Ba se d on t he V a lue of t he M orga n St a nle y M AP T re nd I nde x
Investment Summary

J um p N ot e s w it h Aut o -Ca lla ble Fe a t ure

The Jump Notes with Auto-Callable Feature due June 5, 2023 Based on the Value of the Morgan Stanley MAP Trend Index (the
"notes") provide investors:

an opportunity to gain exposure to the Morgan Stanley MAP Trend Index

the repayment of principal at maturity, subject to our credit risk

the possibility of receiving an early redemption payment or payment at maturity greater than the stated principal amount if
the underlying index closes at or above the applicable redemption threshold level or above the initial index value, as
applicable, on an annual determination date

no exposure to any decline of the underlying index if the notes are held to maturity

At maturity, if the notes have not previously been redeemed and the underlying index has depreciated or has not appreciated at all,
you will receive the stated principal amount of $1,000 per note, without any positive return on your investment.

All payments on the notes, including any early redemption payment and the repayment of principal at maturity, are subject to our
credit risk.

M a t urit y:
5 years
I nt e re st :
None
Aut om a t ic
If, on any annual determination date, the index closing value of the underlying index is greater than or equal to
e a rly
the applicable redemption threshold level, the notes will be automatically redeemed for the early redemption
re de m pt ion
payment on the related early redemption date. No further payments will be made on the notes once they have
a nnua lly,
been redeemed.
be ginning in
M a y 2 0 1 9 :

· 1st determination date: May 31, 2019

· 2nd determination date: June 1, 2020
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· 3rd determination date: June 1, 2021
· 4th determination date: May 31, 2022
· Final determination date: May 31, 2023
Applic a ble
· 1st determination date:
102.50% of the initial index value
re de m pt ion
t hre shold le ve l:

· 2nd determination date:
105.00% of the initial index value

· 3rd determination date:
107.50% of the initial index value

· 4th determination date:
110.00% of the initial index value
Ea rly
The early redemption payment will be an amount in cash per stated principal amount (corresponding to a
re de m pt ion
return of approximately 9.00% per annum) for each annual determination date, as follows:
pa ym e nt :

· 1st determination date: $1,090
· 2nd determination date: $1,180

· 3rd determination date: $1,270
· 4th determination date: $1,360
Pa ym e nt a t
If the notes have not previously been redeemed, you will receive at maturity a cash payment as follows:
m a t urit y:
· If the final index value is greater than the initial index value:
$1,000 + ($1,000 x index percent change)
· If the final index value is less than or equal to the initial index value:
$1,000

May 2018
Page 3
Morgan Stanley Finance LLC
Jump Notes with Auto-Callable Feature due June 5, 2023
Ba se d on t he V a lue of t he M orga n St a nle y M AP T re nd I nde x
T he M orga n St a nle y M AP T re nd I nde x

The Morgan Stanley MAP Trend Index has been developed by and is calculated, published and maintained by Morgan Stanley &
Co. LLC. MAP stands for "Multi-Asset Portfolio." The underlying index employs a rules-based quantitative strategy that combines a
risk-weighted approach to portfolio construction with a momentum-based, or trend-following, asset allocation methodology to
construct a notional portfolio. In addition, the strategy imposes an overall volatility-targeting feature upon the resulting portfolio.

The goal of the underlying index is to maximize returns for a given level of risk based upon recent trends in the underlying assets.
The investment assumption underlying the allocation strategy is two-fold: that historical volatility of the underlying assets can be
used to risk-weight a portfolio, and that past trends are likely to continue to be a good indicator of the future performance of that
portfolio.

The components of the underlying index consist of (i) 20 U.S.-listed exchange traded funds ("ETFs"), representing U.S. and non-
U.S. equities, fixed income securities, commodities and real estate, and (ii) the Morgan Stanley Two Year Treasury Index. The
notional portfolio constructed by the Index Methodology of Index Components is referred to as the Asset Portfolio. The Asset
Portfolio will consist of long-only positions in each Index Component, and each Index Component except for the Morgan Stanley
Two Year Treasury Index is subject to a maximum exposure cap. The targeted volatility for the Index is 5%.

The underlying index is calculated on an excess return basis, and therefore the level is determined by the weighted return of the
Asset Portfolio reduced by the return on an equivalent cash investment receiving the 3-month LIBOR. The underlying index
performance is further reduced by a servicing cost of 0.85% per annum calculated on a daily basis.

The underlying index is rebalanced each Strategy Business Day. Upon each Daily Rebalancing for the underlying index, the Index
Methodology uses the pre-assigned Risk Budget assigned to each ETF and the volatility for each ETF to make initial base
allocations. The Index Methodology then calculates a signal based on the upward or downward trend of each ETF. The underlying
index calculates each Trend Signal by observing two moving averages, one short-term and one long-term, over different look-back
periods for each respective ETF. A Trend Signal that converges toward one indicates an upward trend and a Trend Signal that
https://www.sec.gov/Archives/edgar/data/895421/000095010318007029/dp91867_424b2-ps550.htm[6/5/2018 10:21:09 AM]


converges toward zero indicates a downward trend. Once the Trend Signal is calculated for each ETF, the previously determined
base allocations are scaled by the Trend Signal by allocating more upward-trending securities to the Asset Portfolio. The magnitude
of each position taken by the underlying index following the Trend Signal adjustment is then scaled to the Volatility Target based on
a pro-rata volatility-scaling that seeks to achieve a balanced level of volatility in the underlying index's exposure to each of the
ETFs. Once the composition of the Asset Portfolio is determined, the index value is equivalent to the sum of each Index
Component's market price less the 3-month LIBOR excess return cost and the 0.85% per annum servicing cost.

May 2018
Page 4
Morgan Stanley Finance LLC
Jump Notes with Auto-Callable Feature due June 5, 2023
Ba se d on t he V a lue of t he M orga n St a nle y M AP T re nd I nde x
The original issue price of each note is $1,000. This price includes costs associated with issuing, selling, structuring and hedging
the notes, which are borne by you, and, consequently, the estimated value of the notes on the pricing date is less than $1,000. We
estimate that the value of each note on the pricing date is $966.60.

What goes into the estimated value on the pricing date?

In valuing the notes on the pricing date, we take into account that the notes comprise both a debt component and a performance-
based component linked to the underlying index. The estimated value of the notes is determined using our own pricing and
valuation models, market inputs and assumptions relating to the underlying index, instruments based on the underlying index,
volatility and other factors including current and expected interest rates, as well as an interest rate related to our secondary market
credit spread, which is the implied interest rate at which our conventional fixed rate debt trades in the secondary market.

What determines the economic terms of the notes?

In determining the economic terms of the notes, including the early redemption payment amounts and the applicable redemption
threshold levels, we use an internal funding rate, which is likely to be lower than our secondary market credit spreads and therefore
advantageous to us. If the issuing, selling, structuring and hedging costs borne by you were lower or if the internal funding rate
were higher, one or more of the economic terms of the notes would be more favorable to you.

What is the relationship between the estimated value on the pricing date and the secondary market price of the notes?

The price at which MS & Co. purchases the notes in the secondary market, absent changes in market conditions, including those
related to the underlying index, may vary from, and be lower than, the estimated value on the pricing date, because the secondary
market price takes into account our secondary market credit spread as well as the bid-offer spread that MS & Co. would charge in
a secondary market transaction of this type and other factors. However, because the costs associated with issuing, selling,
structuring and hedging the notes are not fully deducted upon issuance, for a period of up to 6 months following the issue date, to
the extent that MS & Co. may buy or sell the notes in the secondary market, absent changes in market conditions, including those
related to the underlying index, and to our secondary market credit spreads, it would do so based on values higher than the
estimated value. We expect that those higher values will also be reflected in your brokerage account statements.

MS & Co. may, but is not obligated to, make a market in the notes, and, if it once chooses to make a market, may cease doing so
at any time.

May 2018
Page 5
Morgan Stanley Finance LLC
Jump Notes with Auto-Callable Feature due June 5, 2023
Ba se d on t he V a lue of t he M orga n St a nle y M AP T re nd I nde x
K e y I nve st m e nt Ra t iona le

Jump Notes with Auto-Callable Feature offer investors potential returns based on the performance of the underlying index and
provide for the repayment of principal at maturity. They are for investors who are concerned about principal risk but seek exposure
to a multiple asset-linked index, who are willing to accept that the underlying index's volatility target feature may reduce upside
performance in bullish markets, and who are willing to forgo current income in exchange for the possibility of receiving an early
redemption payment or payment at maturity greater than the stated principal amount if the underlying index closes at or above the
https://www.sec.gov/Archives/edgar/data/895421/000095010318007029/dp91867_424b2-ps550.htm[6/5/2018 10:21:09 AM]


applicable redemption threshold level or above the initial index value, as applicable, on an annual determination date.

The following scenarios are for illustrative purposes only to demonstrate how an automatic early redemption payment or the
payment at maturity (if the notes have not previously been redeemed) are calculated, and do not attempt to demonstrate every
situation that may occur.

Sc e na rio 1 : T he not e s a re
Starting on May 31, 2019, when the underlying index closes at or above the applicable
re de e m e d prior t o m a t urit y
redemption threshold level on any annual determination date, the notes will be automatically
redeemed for the applicable early redemption payment on the related early redemption date,
corresponding to a return of approximately 9.00% per annum. Investors do not participate in
any appreciation of the underlying index.
Sc e na rio 2 : T he not e s a re
This scenario assumes that the underlying index closes below the applicable redemption
not re de e m e d prior t o
threshold level on each annual determination date. Consequently, the notes are not redeemed
m a t urit y, a nd inve st ors
prior to maturity. On the final determination date, the underlying index closes above the initial
re c e ive a posit ive re t urn a t
index value. At maturity, investors will receive the state principal amount plus 1-to-1 upside
m a t urit y
performance of the underlying index.
Sc e na rio 3 : T he not e s a re
This scenario assumes that the underlying index closes below the applicable redemption
not re de e m e d prior t o
threshold level on each annual determination date. Consequently, the notes are not redeemed
m a t urit y, a nd inve st ors
prior to maturity. On the final determination date, the underlying index closes at or below the
re c e ive t he st a t e d princ ipa l
initial index value. At maturity, investors will receive a cash payment equal to the stated
a m ount a t m a t urit y
principal amount of $1,000, without any positive return on the notes.
May 2018
Page 6
Morgan Stanley Finance LLC
Jump Notes with Auto-Callable Feature due June 5, 2023
Ba se d on t he V a lue of t he M orga n St a nle y M AP T re nd I nde x
Hypothetical Examples

The following hypothetical examples are for illustrative purposes only. Whether the notes are redeemed prior to maturity will be
determined by reference to the index closing value of the underlying index on each annual determination date, and the payment at
maturity, if the notes are not redeemed early, will be determined by reference to the index closing value on the final determination
date. The actual initial index value and redemption threshold levels are set forth on the cover of this document. Some numbers
appearing in the examples below have been rounded for ease of analysis. All payments on the notes are subject to our credit risk.
The below examples are based on the following terms:

Stated Principal Amount:
$1,000
Hypothetical Initial Index
200
Value:
Hypothetical Redemption
· 1st determination date: 205, which is
Threshold Levels:
102.50% of the hypothetical initial index
value

· 2nd determination date: 210, which is
105.00% of the hypothetical initial index
value

· 3rd determination date: 215, which is
107.50% of the hypothetical initial index
value

· 4th determination date: 220, which is
110.00% of the hypothetical initial index
value

Early Redemption Payment: The early redemption payment will be an amount in cash per stated principal amount (corresponding
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to a return of approximately 9.00% per annum) for each annual determination date, as follows:

· 1st determination date: $1,090
· 2nd determination date: $1,180
· 3rd determination date: $1,270
· 4th determination date: $1,360

No further payments will be made on the notes once they have been redeemed.
Payment at Maturity:
If the notes have not previously been redeemed, you will receive at maturity a cash payment as
follows:
· If the final index value is greater than the initial index value:
$1,000 + ($1,000 x index percent change)
· If the final index value is less than or equal to the initial index value:
$1,000


Aut om a t ic Ca ll:

Ex a m ple 1 -- t he not e s a re re de e m e d follow ing t he se c ond de t e rm ina t ion da t e (w hic h oc c urs in J une 2 0 2 0 )

Date
Index Closing Value
Payment (per note)
200 (below the applicable redemption threshold
1st Determination Date
--
level, notes are not redeemed)
280 (at or above the applicable redemption threshold
2nd Determination Date
$1,180
level, notes are automatically redeemed)



In this example, the index closing value on the first determination date is below the applicable redemption threshold level, and the
index closing value on the second determination date is at or above the applicable redemption threshold level. Therefore the notes
are automatically redeemed on the second early redemption date. Investors will receive $1,180 per note on the related early
redemption date, corresponding to an annual return of approximately 9.00%. No further payments will be made on the notes once
they have been redeemed, and investors do not participate in the appreciation of the underlying index.
Pa ym e nt a t M a t urit y

In the following examples, the index closing value on each annual determination date is less than the applicable redemption
threshold level, and, consequently, the notes are not automatically redeemed prior to, and remain outstanding until, maturity.

Ex a m ple 1 -- t he fina l inde x va lue is a bove t he init ia l inde x va lue

Date
Index Closing Value
Payment (per note)
190 (below the applicable redemption threshold level,
1st Determination Date
--
notes are not redeemed)
200 (below the applicable redemption threshold level,
2nd Determination Date
--
notes are not redeemed)
195 (below the applicable redemption threshold level,
3rd Determination Date
--
notes are not redeemed)
210 (below the applicable redemption threshold level,
4th Determination Date
--
notes are not redeemed)
= $1,000 + ($1,000 x index
percent change)
Final Determination Date
240 (above the initial index value)
= $1,000 + $200 = $1,200
Payment at maturity = $1,200




In this example, the index closing value is below the applicable redemption threshold level on each of the determination dates
before the final determination date, and therefore the notes are not redeemed prior to maturity. On the final determination date, the
underlying index has appreciated 20% from the hypothetical initial index value. At maturity, investors receive the stated principal
amount plus the product of the stated principal amount times the index percent change. Because the underlying index has
appreciated 20% from the hypothetical index value, the payment at maturity is $1,200 per note.
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Ex a m ple 2 -- t he fina l inde x va lue is a t or be low t he init ia l inde x va lue

Date
Index Closing Value
Payment (per note)
190 (below the applicable redemption threshold level,
1st Determination Date
--
notes are not redeemed)
200 (below the applicable redemption threshold level,
2nd Determination Date
--
notes are not redeemed)
195 (below the applicable redemption threshold level,
3rd Determination Date
--
notes are not redeemed)
210 (below the applicable redemption threshold level,
4th Determination Date
--
notes are not redeemed)
Final Determination Date
180 (at or below the initial index value)
Payment at maturity = $1,000



In this example, the index closing value is below the applicable redemption threshold levels on each of the determination dates
before the final determination date, and therefore the notes are not redeemed prior to maturity. On the final determination date, the
final index value is at or below the initial index value, and accordingly, investors receive a payment at maturity equal to the stated
principal amount of $1,000 per note, without any positive return on the notes.

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Risk Factors

The following is a non-exhaustive list of certain key risk factors for investors in the notes. For further discussion of these and other
risks you should read the section entitled "Risk Factors" in the accompanying product supplement and the accompanying
prospectus. You should also consult with your investment, legal, tax, accounting and other advisers in connection with your
investment in the notes.

The notes do not pay interest and may not pay more than the stated principal amount at maturity. If
the notes are not redeemed prior to maturity and the index percent change is less than or equal to 0%, you will receive
only the stated principal amount of $1,000 for each note you hold at maturity. As the notes do not pay any interest, if the
notes have not been automatically redeemed prior to maturity and the underlying index does not appreciate sufficiently
over the term of the notes, the overall return on the notes (the effective yield to maturity) may be less than the amount that
would be paid on a conventional debt security of ours of comparable maturity. The notes have been designed for investors
who are willing to forgo market floating interest rates in exchange for the possibility of receiving an early redemption
payment or payment at maturity greater than the stated principal amount, based on the performance of the underlying
index.

If the notes are automatically redeemed prior to maturity, the appreciation potential of the notes is
lim it e d by t he fix e d e a rly re de m pt ion pa ym e nt spe c ifie d for e a c h of t he first four a nnua l
de t e rm ina t ion da t e s. If the notes are automatically redeemed following any annual determination date, the appreciation
potential of the notes is limited to the fixed early redemption payment specified for each such determination date. No
further payments will be made on the notes once they have been redeemed, and you will not participate in any
appreciation of the underlying index if the notes are redeemed early.

The automatic early redemption feature may limit the term of your investment to as short as
a pprox im a t e ly one ye a r. I f t he not e s a re re de e m e d e a rly, you m a y not be a ble t o re inve st a t
c om pa ra ble t e rm s or re t urns. The term of your investment in the notes may be limited to as short as approximately
one year by the automatic early redemption feature of the notes. If the notes are redeemed prior to maturity, you may be
forced to invest in a lower interest rate environment and may not be able to reinvest at comparable terms or returns.

The redemption threshold level increases progressively over the term of the notes. The notes will be
redeemed only if the index closing value of the underlying index increases from the initial index value to be greater than or
equal to the then-applicable redemption threshold level on one of the first four annual determination dates. Even if the
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value of the underlying index appreciates over the term of the notes, it may not appreciate sufficiently for the notes to be
redeemed early (including because the redemption threshold level increases progressively over the term of the notes).

The market price of the notes w ill be influenced by many unpredictable factors. Several factors will
influence the value of the notes in the secondary market and the price at which MS & Co. may be willing to purchase or
sell the notes in the secondary market, including the value of the underlying index at any time, the volatility (frequency and
magnitude of changes in value) of the underlying index, dividend rate on the exchange traded funds ("ETFs") underlying
the index, interest and yield rates in the market, time remaining until the notes mature, geopolitical conditions and
economic, financial, political, regulatory or judicial events that affect the underlying index or equities markets generally and
which may affect the final index value of the underlying index and any actual or anticipated changes in our credit ratings or
credit spreads. Generally, the longer the time remaining to maturity, the more the market price of the notes will be affected
by the other factors described above. The value of the underlying index may be, and has recently been, volatile, and we
can give you no assurance that the volatility will lessen. See "Hypothetical Retrospective and Historical Information" below.
You may receive less, and possibly significantly less, than the stated principal amount per note if you try to sell your notes
prior to maturity.

The notes are subject to our credit risk, and any actual or anticipated changes to our credit ratings
or c re dit spre a ds m a y a dve rse ly a ffe c t t he m a rk e t va lue of t he not e s. You are dependent on our ability to
pay all amounts due on the notes at maturity and therefore you are subject to our credit risk. The notes are not

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guaranteed by any other entity. If we default on our obligations under the notes, your investment would be at risk and you
could lose some or all of your investment. As a result, the market value of the notes prior to maturity will be affected by
changes in the market's view of our creditworthiness. Any actual or anticipated decline in our credit ratings or increase in
the credit spreads charged by the market for taking our credit risk is likely to adversely affect the market value of the notes.

As a finance subsidiary, MSFL has no independent operations and w ill have no independent assets.
As a finance subsidiary, MSFL has no independent operations beyond the issuance and administration of its securities and
will have no independent assets available for distributions to holders of MSFL securities if they make claims in respect of
such securities in a bankruptcy, resolution or similar proceeding. Accordingly, any recoveries by such holders will be limited
to those available under the related guarantee by Morgan Stanley and that guarantee will rank pari passu with all other
unsecured, unsubordinated obligations of Morgan Stanley. Holders will have recourse only to a single claim against Morgan
Stanley and its assets under the guarantee. Holders of securities issued by MSFL should accordingly assume that in any
such proceedings they would not have any priority over and should be treated pari passu with the claims of other
unsecured, unsubordinated creditors of Morgan Stanley, including holders of Morgan Stanley-issued securities.

There are risks associated w ith the underlying index.

The level of the underlying index can go dow n as w ell as up. There can be no assurance that the underlying
index will achieve positive returns. The underlying index tracks the performance of a rules-based investment methodology
that selects a hypothetical portfolio of Underlying Assets to track. The performance of the underlying index will depend on
the performance of that hypothetical portfolio minus the sum of the 3-month LIBOR and a servicing cost of 0.85% per
annum. If the hypothetical portfolio declines in value, the index value will also decline. Even if the hypothetical portfolio
increases in value, the index value will nevertheless decline if the increase in the value of the portfolio is not sufficient to
overcome the deduction of the 3-month LIBOR and the servicing cost of 0.85% per annum. Accordingly, no assurance can
be given that the underlying index will be successful or outperform any alternative strategy that might be employed in
respect of the Index Components.

The base allocation of ETFs in the Asset Portfolio is determined in reference to each ETF's Risk
Budge t a nd vola t ilit y. The base allocation of each ETF in the Asset Portfolio is determined in proportion to its pre-set
Risk Budget. The Risk Budget was set by the Strategy Sponsor, does not change during the life of the underlying index
and there is no guarantee that the Risk Budget allocated to each ETF is the optimal allocation. A higher or lower Risk
Budget could result in increased investment in an ETF that performs poorly or insufficient investment in an ETF that
performs well over the life of the underlying index. The base allocations of each ETF in the Asset Portfolio are then scaled
relative to the other ETFs in the Asset Portfolio according to their volatility. The base allocation of each ETF can be higher
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or lower than its Risk Budget (However, after the entirety of the underlying index calculation is complete, no ETF's
exposure will exceed its maximum exposure cap.) Volatility calculations based on historical volatility presume that historical
volatility is an accurate indication of current volatility. However, there is a time lag associated with the volatility calculation.
There is no guarantee that the volatility in the preceding period is representative of the current volatility of the ETFs.
Because the underlying index calculates realized volatility over approximately a one-year period, it may be some period of
time before a recent increase in the volatility of the ETFs is sufficiently reflected in the calculation of realized volatility to
cause a compensating change to the base allocation in the Asset Portfolio. Moreover, there is no guarantee that the one
year look-back period for volatility utilized by the underlying index produces the most accurate measure of current volatility.
Accordingly, no assurance can be given that each ETF's Risk Budget and calculated volatility will result in the optimal base
allocation.

There are risks associated w ith the underlying index's momentum investment strategy. The underlying
index is constructed using what is generally known as a momentum-based investment strategy. Momentum-based
investing generally seeks to capitalize on positive trends in the prices of assets. As such, the composition of the underlying
index is based on the historical performance of the ETFs over both long-term and short-term periods. However, there is no
guarantee that trends existing

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in the preceding periods will continue in the future. A momentum-based strategy is different from a strategy that seeks
long-term exposure to a notional portfolio consisting of constant components with fixed weights. The underlying index may
fail to realize gains that could occur as a result of holding assets that have experienced price declines, but after which
experience a sudden price spike. As a result, if market conditions do not represent a continuation of prior observed trends,
the level of the underlying index, which is rebalanced based on prior trends, may decline. Additionally, even when the
values of the ETFs tracked by the underlying index are trending downwards, the underlying index will continue to be
composed of those ETFs until the next rebalancing. Furthermore, the equity and alternative asset classes of ETFs in the
underlying index seek to capitalize on potential counter-trends in the short term. This could potentially result in a failure to
maximize return on an ETF in the equity or alternative asset classes that consistently trends upward over the life of the
underlying index. In this scenario, while the Trend Signal will be 0.5 because the spot horizon is always above the long-
term horizon, it will never result in a Trend Signal of 1 because the short-term horizon value from 1 Strategy Business Day
prior will consistently exceed the spot horizon value from 5 Strategy Business Days prior. This will result in substantially
lower returns than if one were to hold an interest in the underlying ETF itself. Alternatively, this strategy could result in
over-exposure to a steadily declining ETF. The Trend Signal in these asset classes will remain at 1 and the underlying
index will remain fully exposed to an ETF's decline until the ETF begins trending up and the short-term horizon exceeds
the spot horizon or continues declining such that the spot horizon is below the long-term horizon. Even if the spot horizon
falls below the long-term horizon, the Trend Signal will be 0.5 and the underlying index will not fully divest its position until
the spot horizon of the ETF is down compared to both the long-term horizon and the short-term horizon. No assurance can
be given that the investment strategy used to construct the underlying index will outperform any alternative index that might
be constructed from the Index Components.

Low volatility in the underlying index is not synonymous w ith low risk in an investment linked to the
unde rlying inde x . For example, even if the volatility of the underlying index were to be in line with the Volatility Target,
the index level may decrease over time, which may result in a zero return on the notes.

While the underlying index has a Volatility Target of 5%, there can be no guarantee, even if the Asset
Port folio is re ba la nc e d da ily, t ha t t he re a lize d vola t ilit y of t he unde rlying inde x w ill not be le ss t ha n
or gre a t e r t ha n 5 % . In fact, the historical volatility of the underlying index, based on simulated returns, has generally
been between 4% and 6%. Although the underlying index aims to ensure that its realized volatility does not exceed 5%,
there is no guarantee that it will successfully do so. There is a time lag associated with the underlying index's volatility
control adjustments. Because realized volatility is measured over either approximately the prior month or two months for
purposes of the volatility control feature, it may be some period of time before a recent increase in the volatility of the
index ETFs is sufficiently reflected in the calculation of realized volatility to cause a compensating reallocation in the Asset
Portfolio. During the intervening period, if the increased volatility is associated with a significant decline in the value of the
index ETFs, the underlying index may in turn experience a significant decline without the reduction in exposure to the
Index ETFs that the volatility control feature is intended to trigger. Moreover, the index ETFs during the earlier part of the
relevant volatility period may be different than the current index ETFs, and if the earlier index ETFs were significantly less
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