MORGAN STANLEY — Capital/Financing Update 2010

Dec 1, 2010

Free Writing Prospectus Dated December 1, 2010 Registration Statement No. 333-156423 Filed Pursuant to Rule 433
●	Morgan Stanley

US Target Equity (Total Return) [GRAPHIC OMITTED]

Morgan Stanley Target Equity Index

The US Target Equity (TR) Index seeks to identify undervalued stocks with strong
potential. It selects stocks using a quantitative, rules-based screening process
developed by Morgan Stanley. The selection methodology uses some of the metrics
used by private equity investors and corporate buyers. The Index aims to
identify companies with favorable cash flow, strong balance sheets and assets
undervalued by the market. The index is independently calculated and maintained
by Standard and Poor's (SandP) on a stock price and dividend income total return
basis and is rebalanced quarterly.

SandP began calculating the US Target Equity (TR) on July 1, 2007. Historical
index performance prior to July 2007 is simulated based on historical data.
Simulated historical Index performance is hypothetical and presented for
illustrative purposes. Past performance (actual or simulated) is not indicative
of future results.

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Absolute returns

[GRAPHIC OMITTED]

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Source: Morgan Stanley; Total Return = (TR)

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Annual returns

01 02 03 04 05 06 07 08 09 10*
Annual return
US Target Equity (TR) 17.7% -1.1% 40.6% 26.6% 12.3% 19.2% -0.2% -33.8% 47.0% 12.8%
SandP 500 (TR) 4.8% -22.5% 28.0% 10.2% 4.3% 15.1% 4.9% -37.4% 25.6% 7.3%
Annual excess return vs benchmark
US Target Equity (TR) 12.9% 21.4% 12.6% 16.4% 8.0% 4.1% -5.1% 3.6% 21.5% 5.5%
Volatility 1
US Target Equity (TR) 20.9% 26.8% 16.6% 10.4% 10.9% 10.1% 17.3% 44.8% 38.2% 18.5%
SandP 500 (TR) 19.7% 25.5% 16.7% 10.9% 10.1% 9.9% 15.7% 40.3% 26.8% 18.4%

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Source: Morgan Stanley; * Index starts April 4, 2001, ** data until November 30, 2010

Returns prior to the Index launch, from April 4, 2001 through June 30, 2007, are
simulated based on historical data.

Returns from July 1, 2007 through November 30, 2010 reflect actual results.

1 Standard deviation of daily returns, annualized

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Index facts

Index Sponsor Morgan Stanley Index Inception Date July 1, 2007
Calculation Agent SandP Rebalancing frequency Quarterly
Currency USD Number of constitutents 50
Index type Total return Weighting Equal

Please refer to important information at the end of this material |

Morgan Stanley US Target Equity (Total Return) [GRAPHIC OMITTED] -------------------------------------------------------------------------------- Volatility - rolling 12 month Sector allocations (at date of last US Target Equity (TR) -------------------------------------------------------------------------------- [GRAPHIC OMITTED] -------------------------------------------------------------------------------- Source: Morgan Stanley; * October 05, 2010 Returns prior to the Index launch, from April 4, 2001 through June 30, 2007, are simulated based on historical data. Returns from July 1, 2007 through November 30, 2010 reflect actual results. There is no guarantee that the Target Equity Indices will have positive performance or will outperform benchmark indices. No one can guarantee short-term or long-term outperformance. The stock selection process for the Target Equity Indices could select stocks that underperform the benchmark index, possibly significantly. -------------------------------------------------------------------------------- Important information -------------------------------------------------------------------------------- Morgan Stanley has filed a registration statement (including a prospectus), and will file a pricing supplement, with the SEC for any offering to which this communication relates. Before you invest in any offering, you should read the prospectus in that registration statement, the applicable pricing supplement and other documents Morgan Stanley has filed with the SEC for more complete information about Morgan Stanley and that offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, Morgan Stanley, any underwriter or any dealer participating in any offering will arrange to send you the prospectus if you request it by calling toll free 1-800-584-6837. This material was prepared by sales, trading or other non-research personnel of Morgan Stanley and Co. Incorporated (together with its affiliates, hereinafter "Morgan Stanley"). This material was not produced by a Morgan Stanley research analyst. Unless otherwise indicated, these views may differ from those of the Morgan Stanley fixed income or equity research department or others in the firm. The Target Equity principles and methodology described herein may not work in every circumstance or with respect to the financial information of every company. The measures and factors considered in the Target Equity analysis are not necessarily correlated with financial or market performance of the constituent companies and may fail to highlight negative information or data that could adversely affect the Target Equity Index performance or an investment related to Target Equity. In addition, the Target Equity principles are subject to change and may not always achieve their intended results. Performance data for the index prior to the Index Inception Date has been calculated retrospectively, based on simulated historical performance. Retrospective index calculation based on simulated performance is purely hypothetical and may not be an accurate or meaningful comparison. Past performance (actual or simulated) is not necessarily indicative of future results. No representation or warranty is made that any returns indicated will be achieved. Investments and services are offered through Morgan Stanley and Co. Incorporated, member SIPC. Copyright (C) by Morgan Stanley 2010, all rights reserved.