MORGAN STANLEY CAPITAL OPPORTUNITIES TRUST
1221 AVENUE OF THE AMERICAS
NEW YORK, NY 10020
March 28, 2007
Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
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Attention: | Larry Greene Division of Investment Management |
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Re: | Morgan Stanley Capital Opportunities Trust (File Nos. 33-63685 and 811-7377) |
Dear Mr. Greene:
Thank you for your telephonic comments on March 6, 2007 regarding the registration statement on Form N-1A for Morgan Stanley Capital Opportunities Trust (the ‘‘Fund’’) filed with the Securities and Exchange Commission on January 29, 2007. Below, we provide responses or any supplemental explanations to the Staff’s comments, as requested. Post-effective amendment number 18 to the Fund’s registration statement on Form N-1A, will be filed via EDGAR on or about March 28, 2007.
GENERAL COMMENTS TO FORM N-1A
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Comment 1. | Please file a response letter to these comments via EDGAR, including the ‘‘Tandy’’ provision. |
Response 1. This response letter addressing the Staff’s comments has been filed via EDGAR correspondence, including the ‘‘Tandy’’ provision, separate from the corresponding Post-Effective Amendment.
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Comment 2. | Please confirm that the appropriate boxes are checked on the cover sheet to Form N-1A. |
Response 2. We confirm that the appropriate boxes are checked.
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Comment 3. | Please indicate whether the Fund is current with its 40-17G filings. |
Response 3. The Fund is current with such filings.
COMMENTS TO THE PROSPECTUS
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Comment 4. | Please confirm that the Fund’s policy of investing in foreign securities, including emerging markets securities, is a ‘‘principal investment strategy’’ as that term is defined in Item 4 of Form N-1A |
Response 4. The Fund hereby confirms that its policy of investing up to 25% of its assets in foreign securities, including emerging market securities, is a principal investment strategy.
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Comment 5. | In the ‘‘Fees and Expenses’’ section of the prospectus, consider moving the footnotes to after the Example. |
Response 5. We respectfully acknowledge the comment, but believe the current placement of the footnotes is appropriate. We believe to move the footnotes to below the Example would diminish the impact of the information and could result in a shareholder being unable to locate the footnotes.
COMMENTS TO THE STATEMENT OF ADDITIONAL INFORMATION
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Comment 6. | In the section titled ‘‘Description of the Fund and its Investment and Risks – Loans of Portfolio Securities’’ disclose whether the Fund may use an affiliated securities lending agent. |
Response 6. The Fund currently does not use an affiliated lending agent.
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Comment 7. | With regard to non-fundamental investment restriction number 2, add appropriate disclosure to the fee table in the prospectus if the Fund invested in other investment companies during the last fiscal year. |
Response 7. The Fund did not invest in other investment companies during the prior fiscal year, therefore, no changes need to be made to the fee table.
As you have requested and consistent with SEC Release 2004-89, the Fund hereby acknowledges that:
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• | the Fund is responsible for the adequacy and accuracy of the disclosure in the filings; |
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• | the Staff’s comments or changes to disclosure in response to Staff comments in the filings reviewed by the Staff do not foreclose the Commission from taking any action with respect to the filings; and |
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• | the Fund may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. |
If you would like to discuss any of these responses in further detail or if you have any questions, please feel free to contact me at (212) 762-8687. Thank you.
Sincerely,
/s/ Edward Meehan
Edward Meehan
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