Morgan Stanley files for next round of ETFs

Morgan Stanley is seeking to launch its next wave of exchange-traded funds after reentering the industry in February, nearly three decades after helping to birth the now $7.5 trillion industry. 

Applications for the Eaton Vance Ultra-Short Income ETF, the Eaton Vance High Yield ETF and the Eaton Vance Intermediate Municipal Income ETF landed with the Securities and Exchange Commission on Monday, filings show, in addition to an application for the Parametric Dividend Premium Income ETF. Morgan Stanley’s purchase of Eaton Vance — and thus Parametric Portfolio Associates — closed in 2021.

Morgan Stanley was one of a handful of major financial firms without a presence in the ETF arena up until this February, when it launched its first six modern-day ETFs after being home to some of the world’s first such products in the 1990s. Those debuts were the “first step in a series,” Morgan Stanley global head of ETFs Anthony Rochte said at the time, leading to Monday’s applications. So far, its six environmental, social and governance-focused ETFs have accumulated nearly $400 million in assets.

While Eaton Vance is well-known in the fixed-income world, it’s entering into a saturated market, according to Bloomberg Intelligence,

“I personally like Eaton Vance. It’s got a great brand in fixed income, but there are a lot of short-duration ETFs,” Bloomberg Intelligence ETF analyst Athanasios Psarofagis said. “So it’s a good brand in a crowded space.”

Tickers and fees for the proposed funds were not yet listed.

What’s driving the boom in active ETFs? Will it last?

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