⚠ The Funnel Leaks at the HandoverModerate threat

Morgan Stanley (MS) — threat to the moat

Morgan Stanley's funnel catches clients early, but the rate at which they reach an adviser is not in the filings.

The funnel's promise rests on conversion: that a self-directed investor or a stock-plan participant eventually hands money to an adviser. Morgan Stanley reports the channels' assets and the flows, but the rate at which clients move from one channel to another is not a line in the filings used here.

Advisor-led client assets ($bn)4,75820245,71520256,273Jun 2026Morgan Stanley Form 10-K FY2025; Q2 2026 financial supplement
Growing, mostly with markets.

What is visible is advisor-led growth. Advisor-led client assets were $4,758 billion at the end of 2024 and $5,715 billion at the end of 20251, and $6,273 billion in June 20262. Much of that increase is market movement.

The rivals for the handover are many. The firm lists broker-dealers, private banks, registered investment advisers and digital investing platforms among its competitors3, and each can bid for the vested stock or the inherited account.

The firm itself describes the mechanism it is relying on as "Advisor-Led Flows from Workplace and E*TRADE"4, and it counts core client relationships rising from about 13 million in 2020 to about 20 million in 20255. Those are relationships, not advised accounts, and the gap between the two is where the leak would be.

The measure that would reveal a leak is the pace of advisor-led net inflows once the IPO-driven workplace money is removed. If those flows fell for two years while the cheaper channels kept growing, the funnel would be catching clients for someone else.

References
  1. ReportedAdvisor-led client assets were $4,758 billion at the end of 2024 and $5,715 billion at the end of 2025, and $6,273 billion in June 2026.
    Morgan Stanley Form 10-K for fiscal 2025 - Wealth Management metrics: client assets, flows, channels, deposits and adviser loans. — FY2025 · publ. 19 February 2026 · source ↗
  2. ReportedAdvisor-led client assets were $4,758 billion at the end of 2024 and $5,715 billion at the end of 2025, and $6,273 billion in June 2026.
    Morgan Stanley second-quarter 2026 financial supplement, Form 8-K exhibit 99.2 - Wealth Management metrics, Investment Management assets under management and flows, regional revenues. — Q2 2026 · publ. 15 July 2026 · source ↗
  3. ReportedThe firm lists broker-dealers, private banks, registered investment advisers and digital investing platforms among its competitors, and each can bid for the vested stock or the inherited account.
    Morgan Stanley Form 10-K for fiscal 2025 - Item 1A risk factors, competition and legal proceedings. — FY2025 · publ. 19 February 2026 · source ↗
  4. ReportedThe firm itself describes the mechanism it is relying on as "Advisor-Led Flows from Workplace and E*TRADE", and it counts core client relationships rising from about 13 million in 2020 to about 20 million in 2025.
    Morgan Stanley strategic update, The Integrated Firm: Executing on a Higher Plane, Form 8-K exhibit 99.3 - ROTCE 2016-2025, firmwide goals, five-year Wealth Management aggregates and wallet share. — 2016-2025 · publ. 15 January 2026 · source ↗
  5. ReportedThe firm itself describes the mechanism it is relying on as "Advisor-Led Flows from Workplace and E*TRADE", and it counts core client relationships rising from about 13 million in 2020 to about 20 million in 2025.
    Morgan Stanley strategic update, The Integrated Firm: Executing on a Higher Plane, Form 8-K exhibit 99.3 - ROTCE 2016-2025, firmwide goals, five-year Wealth Management aggregates and wallet share. — 2016-2025 · publ. 15 January 2026 · source ↗
Sources
Generated September 26, 2026