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48	48	The company has three reportable segments - Institutional Securities, Wealth Management, and Investment Management. Substantially all of the operating revenues and operating expenses of the company are directly attributable to those business segments.
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50		-Institutional Securities segment includes the services such as equity financing, equity execution services and fixed incomes from investments and other sources. Under this segment, the company reports Investment Banking revenues. The company works as advisor, underwriter, and distributor of capital for the clients. The revenue from this segment is generated from fees earned from underwriting equity and fixed income securities, syndicating loans and advisory services in relation to mergers and acquisitions, divestitures and corporate restructurings. Morgan Stanley works as a market maker for their clients in trading cash instruments and derivatives. The company buys, sells, or otherwise transacts with customers under a variety of market conditions. Morgan Stanley engages in multiple activities as a part of its market-making function including taking positions and holding that position for a period of time, building, maintaining and rebalancing inventory, managing and assuming basis risk (risk associated with imperfect hedging) between risks incurred from the facilitation of client transactions and the standardized products available in the market to hedge those risks, engaging in activities to provide efficiency and liquidity for markets. The company also carries loans at fair value, and hold equity securities for which it receives fees or dividends. Gains and losses from business-related investments also fall under this segment. Certain investments from them are subject to sale restrictions. Typically, there are no fee revenues from these investments.
	50	+== Institutional Securities ==
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	52	+Institutional Securities segment includes the services such as equity financing, equity execution services and fixed incomes from investments and other sources. Under this segment, the company reports Investment Banking revenues. The company works as advisor, underwriter, and distributor of capital for the clients. The revenue from this segment is generated from fees earned from underwriting equity and fixed income securities, syndicating loans and advisory services in relation to mergers and acquisitions, divestitures and corporate restructurings. Morgan Stanley works as a market maker for their clients in trading cash instruments and derivatives. The company buys, sells, or otherwise transacts with customers under a variety of market conditions. Morgan Stanley engages in multiple activities as a part of its market-making function including taking positions and holding that position for a period of time, building, maintaining and rebalancing inventory, managing and assuming basis risk (risk associated with imperfect hedging) between risks incurred from the facilitation of client transactions and the standardized products available in the market to hedge those risks, engaging in activities to provide efficiency and liquidity for markets. The company also carries loans at fair value, and hold equity securities for which it receives fees or dividends. Gains and losses from business-related investments also fall under this segment. Certain investments from them are subject to sale restrictions. Typically, there are no fee revenues from these investments. Securities held by the Firm generally earn interest, as do securities borrowed and securities purchased under agreements to resell, while securities loaned and securities sold under agreements to repurchase generally incur interest expense. Equity methods investments, lending activities, economic derivative hedges, lending commitments held for sale fall under this segment.
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	54	+=== Equity - Financing ===
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54		-Wealth Management segment includes revenues from the distribution of newly issued securities. Morgan Stanley works as principal to the customers' purchases and sales of fixed income instruments. The company also manages the employees' deferred compensation plan from which it records gains and losses. Morgan Stanley earns commissions and fees from client transactions primarily in equity securities, insurance products, mutual funds, futures and options. The firm also earns revenues from order flow payments for directing customer orders to broker-dealers, exchanges and market centers for execution. This segment also include services associated with fee-based assets, account service and administration, as well as distribution of products. The company receives revenue for advisory services to these areas. The revenues generated from these services are generally based on the net asset value of the account in which a client is invested.
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56		-Under the Investment Management segment the company invests funds of employee deferred compensation and co-investment plans. The profit or loss from this segment depends on the fair value estimation of these invested funds. The company uses judgmental approach in estimating the revenues from investments which may be subject to market, financial, and overall business conditions existing in the market.  Investments revenues are primarily from performance-based fees in the form of carried interest, a portion of which is subject to reversal, and gains and losses from investments. The business is entitled to receive carried interest when the return in certain funds exceeds specified performance targets. Additionally, there are certain sponsored Investment Management funds consolidated by Morgan Stanley where revenues are primarily attributable to holders of noncontrolling interests. This segment generates revenues from performance-based fees for asset management.
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	59	+== Wealth Management ==
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	61	+Wealth Management segment includes revenues from the distribution of newly issued securities. Morgan Stanley works as principal to the customers' purchases and sales of fixed income instruments. The company also manages the employees' deferred compensation plan from which it records gains and losses. Morgan Stanley earns commissions and fees from client transactions primarily in equity securities, insurance products, mutual funds, futures and options. The firm also earns revenues from order flow payments for directing customer orders to broker-dealers, exchanges and market centers for execution. This segment also include services associated with fee-based assets, account service and administration, as well as distribution of products. The company receives revenue for advisory services to these areas. The revenues generated from these services are generally based on the net asset value of the account in which a client is invested. Within the Wealth Management business segment, Interest income is driven by Investment securities, Loans and margin loans. Interest expense is driven by Deposits and other funding. Upon acquisition, E*TRADE’s Investment securities were recorded at fair value, and the resulting premium is being amortized over the life of the portfolio against interest income.
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	63	+== Investment Management ==
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	65	+Under the Investment Management segment the company invests funds of employee deferred compensation and co-investment plans. The profit or loss from this segment depends on the fair value estimation of these invested funds. The company uses judgmental approach in estimating the revenues from investments which may be subject to market, financial, and overall business conditions existing in the market.  Investments revenues are primarily from performance-based fees in the form of carried interest, a portion of which is subject to reversal, and gains and losses from investments. The business is entitled to receive carried interest when the return in certain funds exceeds specified performance targets. Additionally, there are certain sponsored Investment Management funds consolidated by Morgan Stanley where revenues are primarily attributable to holders of noncontrolling interests. This segment generates revenues from performance-based fees for asset management.
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