July 2024 industry research shows impact investing funds lean toward mid-cap ESG leaders, which are displaying stronger revenue growth than large-cap peers due to agile innovation models. Founded by Caspar Macqueen, a former BlackRock executive, and Christian Czernich, founder of the private credit firm Round2 Capital, the new fund plans to provide working capital to technology companies in Europe without taking an equity stake. Morgan Stanley Smith Barney LLC and Morgan Stanley & Co. LLC (collectively, “Morgan Stanley”), Members SIPC, recommend that recipients should determine, in consultation with their own investment, legal, tax, regulatory and accounting advisors, the economic risks and merits, as well as the legal, tax, regulatory and accounting characteristics and consequences, of the transaction or strategy referenced in any materials. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. Morgan Stanley, its affiliates, employees and Morgan Stanley Financial Advisors do not provide tax, accounting or legal advice. Individuals should consult their tax advisor for matters involving taxation and tax planning, and their attorney for matters involving legal matters. Impact investing funds continue to track above market returns, with the S&P 500 ESG Index up 7.4% YTD compared to the broader S&P's 6.1%. Portfolio managers anticipate further rotation into clean energy and technology innovation sectors.