Morgan Stanley Strategist Fund N-CSRS Certified semi-annual shareholder report (management investment company)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-05634

Morgan Stanley Global Strategist Fund

(Exact name of registrant as specified in charter)

522 Fifth Avenue, New York, New York	10036
(Address of principal executive offices)	(Zip code)

Sara Furber
522 Fifth Avenue, New York, New York 10036
(Name and address of agent for service)

Registrant’s telephone number, including area code: 212-296-6990

Date of fiscal year end: July 31, 2011

Date of reporting period: January 31, 2011

Item 1 — Report to Shareholders

INVESTMENT MANAGEMENT

Welcome, Shareholder:

In this report, you’ll learn about how your investment in Morgan Stanley Global Strategist Fund performed during the semiannual period. We will provide an overview of the market conditions, and discuss some of the factors that affected performance during the reporting period. In addition, this report includes the Fund’s financial statements and a list of Fund investments.

This material must be preceded or accompanied by a prospectus for the fund being offered.

Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the Fund will achieve its investment objective. The Fund is subject to market risk, which is the possibility that market values of securities owned by the Fund will decline and, therefore, the value of the Fund’s shares may be less than what you paid for them. Accordingly, you can lose money investing in this Fund. Please see the prospectus for more complete information on investment risks.

Fund Report

For the six months ended January 31, 2011

Total Return for the 6 Months Ended January 31, 2011

				Morgan
				Stanley
				Capital	Barclays
				International	Capital	Lipper
				(MSCI) All	U.S.	Flexible
				Country	Government/	Portfolio
				World	Credit	Funds
Class A	Class B	Class C	Class I	Index1	Index2	Index3
10.89%	10.47%	10.40%	10.94%	16.77%	0.00%	13.73%

The performance of the Fund’s four share classes varies because each has different expenses. The Fund’s total returns assume the reinvestment of all distributions but do not reflect the deduction of any applicable sales charges. Such costs would lower performance. See Performance Summary for standardized performance and benchmark information.

Market Conditions

Global equities rallied during the six-month period ended January 31, 2011, as additional quantitative easing by central banks and improving economic conditions outweighed sovereign debt concerns in Europe and rising inflation in emerging market nations. Throughout the third quarter of 2010, risk aversion stemming from disappointing economic data releases and exhilaration resulting from central bank intervention caused financial market sentiment to oscillate from bearishness to bullishness.

While the market’s advance in July was offset by a retreat in August, September’s rally propelled equities to positive overall returns for the third calendar quarter of 2010. Looking at the details, global equities bounced sharply off their lows in early July as positive European bank stress test results seemingly signaled that the worst of the European debt crisis had passed. However, sovereign debt rating cuts and outlook downgrades within the eurozone reignited European sovereign debt fears, elevating risk spreads back to peak crisis levels. In response to this weakening backdrop, the U.S. Federal Reserve announced it would reinvest its maturing agency and mortgage-backed securities into U.S. Treasury notes, offering additional quantitative easing measures if it became necessary. Throughout December 2010 and January 2011, sentiment improved once again, as resurgent global economic data, a renewed merger and acquisition cycle, and corporate profitability all provided investors with greater confidence going into the New Year.

In the U.S., sentiment became extremely bullish as leading indicators posted strong quarterly gains and initial jobless claims fell to a two-year low. In addition, the Federal Reserve formally announced a $600 billion plan to purchase Treasuries, while Congress passed an extension of the Bush-era tax cuts. In response to an improving economic backdrop, strategists and analysts began to raise their forecasts for 2011, further driving equity prices higher. Elsewhere, emerging market nations continued to face rising inflationary concerns on the back of spiking commodity prices. In response, local governments began tightening monetary policy, raising concerns that global growth would slow.

Performance Analysis

All share classes of Morgan Stanley Global Strategist Fund outperformed the Barclays Capital U.S.

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Government/Credit Index but underperformed the MSCI All Country World Index (the “Index”) and the Lipper Flexible Portfolio Funds Index for the six months ended January 31, 2011, assuming no deduction of applicable sales charges.

The Fund’s underperformance versus the all-equity benchmark (MSCI All Country World Index) can be directly attributed to its asset allocation mandate and lower volatility and risk profile. The Fund’s underperformance versus the Lipper Flexible Portfolio Funds Index can be directly attributed to the Fund’s higher exposure to non-U.S. equities and fixed income, as well as its lower risk profile when compared to its peers within this category. Finally, the Fund’s outperformance versus the Barclays Capital U.S. Government/Credit Index can be attributed to its exposure to both global equities and commodities.

The Fund maintained a relatively balanced asset allocation blend throughout the period under review, with global equity exposures ranging from 58 percent to 63 percent, global fixed income exposures ranging from 27 percent to 33 percent, commodity exposure ranging from 2 percent to 4 percent and cash equivalents ranging from 5 percent to 7 percent. The Fund exited January 2011 with global equity exposures at approximately 61.2 percent of total Fund assets, fixed income exposures of approximately 29.2 percent of total assets, diversified commodity exposures of approximately 3.5 percent of total assets and cash equivalents of approximately 6.1 percent of total assets.

Factors that contributed positively to the period’s performance versus the MSCI All Country World Index included equity relative exposures by geography (overweights to the U.S., Germany and Hong Kong) and global sector weights (overweights to information technology and materials).

Factors that detracted from performance included the Fund’s asset allocation weights (exposures to fixed income and cash equivalents), an overweight in Japanese equities, and an overweight to more defensive, dividend-paying large capitalization equities.

There is no guarantee that any sectors mentioned will continue to perform as discussed herein or that securities in such sectors will be held by the Fund in the future.

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TOP 10 HOLDINGS as of 01/31/11
Deutsche Bank AG London (Series 0005) (144A)	3.5	%
U.S. Treasury Note	1.1
Financial Select Sector SPDR Fund (ETF)	1.1
U.S. Treasury Bond	0.8
Japan Government Thirty Year Bond (Series 11)	0.7
United Kingdom Gilt	0.6
Japan Government Ten Year Bond (Series 294)	0.6
Bundesrepublik Deutschland (Series 08)	0.6
Exxon Mobil Corp.	0.6
Bundesrepublik Deutschland (Series 03)	0.6

PORTFOLIO COMPOSITION† as of 01/31/11
Common Stocks	52.0	%
Short-Term Investments	15.6
Foreign Government Obligations	11.8
Corporate Notes/Bonds	8.2
U.S. Government Agencies & Obligations	6.4
Commodity-Linked Securities	3.5
Other Securities	2.5

† Does not include open long/short futures contracts with an underlying face amount of $179,065,778 and net unrealized appreciation of $582,856. Also does not include open swap contracts with net unrealized depreciation of $1,205,809 and open foreign currency exchange contracts with net unrealized appreciation of $525,901.

Subject to change daily. Provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned above. Top 10 holdings are as a percentage of net assets and portfolio composition are as a percentage of total investments. Morgan Stanley is a full-service securities firm engaged in securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services.

Investment Strategy

The Fund’s Investment Adviser, Morgan Stanley Investment Advisors Inc., seeks to achieve the Fund’s investment objective by investing primarily in a blend of equity and fixed-income securities of U.S. and non-U.S. issuers. Equity securities may include common and preferred stocks, depositary receipts, convertible securities, equity-linked securities, real estate investment trusts (“REITs”), and rights and warrants to purchase equity securities. Fixed income securities may include mortgage-related or mortgage-backed securities, floating rate securities, inflation-linked fixed income securities, securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities, securities issued or guaranteed by non-U.S. governments, their agencies, or instrumentalities, corporate bonds and notes issued by U.S. and non-U.S. entities.

For More Information About Portfolio Holdings

Each Morgan Stanley fund provides a complete schedule of portfolio holdings in its semiannual and annual reports within 60 days of the end of the fund’s second and fourth fiscal quarters. The semiannual reports and the annual reports are filed electronically with the Securities and Exchange Commission (SEC) on Form N-CSRS and Form N-CSR, respectively. Morgan Stanley also delivers the semiannual and annual reports to fund shareholders and makes these reports available on its public web site, www.morganstanley.com. Each Morgan Stanley fund also files a complete schedule of portfolio holdings with the SEC for the fund’s first and third fiscal quarters on Form N-Q. Morgan Stanley does not deliver the reports for the first and third fiscal quarters to shareholders, nor are the reports posted

4

to the Morgan Stanley public web site. You may, however, obtain the Form N-Q filings (as well as the Form N-CSR and N-CSRS filings) by accessing the SEC’s web site, http://www.sec.gov. You may also review and copy them at the SEC’s public reference room in Washington, DC. Information on the operation of the SEC’s public reference room may be obtained by calling the SEC’ at (800) SEC-0330. You can also request copies of these materials, upon payment of a duplicating fee, by electronic request at the SEC’s e-mail address (publicinfo@sec.gov) or by writing the public reference section of the SEC, Washington, DC 20549-1520.

Proxy Voting Policy and Procedures and Proxy Voting Record

You may obtain a copy of the Fund’s Proxy Voting Policy and Procedures without charge, upon request, by calling toll free (800) 869-NEWS or by visiting the Mutual Fund Center on our web site at www.morganstanley.com. It is also available on the SEC’s web site at http://www.sec.gov.

You may obtain information regarding how the Fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 without charge by visiting the Mutual Fund Center on our web site at www.morganstanley.com. This information is also available on the SEC’s web site at http://www.sec.gov.

Householding Notice

To reduce printing and mailing costs, the Fund attempts to eliminate duplicate mailings to the same address. The Fund delivers a single copy of certain shareholder documents, including shareholder reports, prospectuses and proxy materials, to investors with the same last name who reside at the same address. Your participation in this program will continue for an unlimited period of time unless you instruct us otherwise. You can request multiple copies of these documents by calling (800) 869-NEWS, 8:00 a.m. to 8:00 p.m., ET. Once our Customer Service Center has received your instructions, we will begin sending individual copies for each account within 30 days.

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Performance Summary

Average Annual Total Returns — Period Ended January 31, 2011

	Class A Shares	*	Class B Shares	**	Class C Shares	†	Class I Shares	††
	(since 07/28/97	)	(since 10/31/88	)	(since 07/28/97	)	(since 07/28/97	)
Symbol	SRTAX		SRTBX		SRTCX		SRTDX
1 Year	14.85	%4	13.99	%4	13.93	%4	15.03	%4
	8.82	5	9.13	5	12.96	5	—
5 Years	4.25	4	3.47	4	3.48	4	4.51	4
	3.14	5	3.17	5	3.48	5	—
10 Years	3.62	4	2.98	4	2.84	4	3.86	4
	3.06	5	2.98	5	2.84	5	—
Since Inception	5.66	4	8.60	4	4.86	4	5.91	4
	5.24	5	8.60	5	4.86	5	—
Gross Expense Ratio	0.94		1.69		1.69		0.69

Performance data quoted represents past performance, which is no guarantee of future results and current performance may be lower or higher than the figures shown. For most recent month-end performance figures, please visit www.morganstanley.com/im or speak with your Financial Advisor. Investment returns and principal value will fluctuate and fund shares, when redeemed, may be worth more or less than their original cost. The table does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Performance for Class A, Class B, Class C, and Class I shares will vary due to differences in sales charges and expenses. See the Fund’s current prospectus for complete details on fees and sales charges. Expenses are as of each Fund’s fiscal year end as outlined in the Fund’s current prospectus.

*	The maximum front-end sales charge for Class A is 5.25%.
**	The maximum contingent deferred sales charge (CDSC) for Class B is 5.0%. The CDSC declines to 0% after six years. Effective April 2005, Class B shares will generally convert to Class A shares approximately eight years after the end of the calendar month in which the shares were purchased. Performance for periods greater than eight years reflects this conversion (beginning April 2005).
†	The maximum contingent deferred sales charge for Class C is 1.0% for shares redeemed within one year of purchase.
††	Class I has no sales charge.
(1)	The Morgan Stanley Capital International (MSCI) All Country World Index (ACWI) is a free float-adjusted market capitalization weighted index designed to measure the equity market performance of developed and emerging markets. The term “free float” represents the portion of shares outstanding that are deemed to be available for purchase in the public equity markets by investors. The Index is unmanaged and its returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.
(2)	The Barclays Capital U.S. Government/Credit Index tracks the performance of government and corporate obligations, including U.S. government agency and Treasury securities and corporate and Yankee bonds. The Index is unmanged and its returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.
(3)	The Lipper Flexible Portfolio Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Flexible Portfolio Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 30 funds represented in this Index. The Fund was in the Lipper Flexible Portfolio Funds classification as of the date of this report.
(4)	Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges.
(5)	Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund’s current prospectus for complete details on fees and sales charges.

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Expense Example

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and (2) ongoing costs, including advisory fees; distribution and service (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period 08/01/10 – 01/31/11.

Actual Expenses

The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing cost of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of the table is useful in comparing ongoing costs, and will not help you determine the relative total cost of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning		Ending		Expenses Paid
	Account Value		Account Value		During Period@
					08/01/10 –
	08/01/10		01/31/11		01/31/11
Class A
Actual (10.89% return)	$	1,000.00	$	1,108.90	$	5.10
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,020.37	$	4.89
Class B
Actual (10.47% return)	$	1,000.00	$	1,104.70	$	9.07
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,016.59	$	8.69
Class C
Actual (10.40% return)	$	1,000.00	$	1,104.00	$	9.07
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,016.59	$	8.69
Class I
Actual (10.94% return)	$	1,000.00	$	1,109.40	$	3.78
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,021.63	$	3.62

@ Expenses are equal to the Fund’s annualized expense ratios of 0.96%, 1.71%, 1.71% and 0.71% for Class A, Class B, Class C and Class I shares, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). If the Fund had borne all of its expenses, the annualized expense ratios would have been 0.98%, 1.73%, 1.73% and 0.73% for Class A, Class B, Class C and Class I shares, respectively.

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Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited)

NUMBER OF
SHARES			VALUE
		Common Stocks (52.3%)
		Australia (2.4%)
		Air Freight & Logistics
	11,045	Toll Holdings Ltd.	$	64,776
		Beverages
	8,808	Coca-Cola Amatil Ltd.		98,958
	42,869	Foster’s Group Ltd.		241,809
				340,767
		Biotechnology
	8,567	CSL Ltd.		318,235
		Capital Markets
	5,106	Macquarie Group Ltd.		207,774
		Chemicals
	6,321	DuluxGroup Ltd.		16,903
	25,937	Incitec Pivot Ltd.		111,792
	6,321	Orica Ltd.		160,274
				288,969
		Commercial Banks
	40,234	Australia & New Zealand Banking Group Ltd.		952,649
	21,794	Commonwealth Bank of Australia		1,143,508
	33,535	National Australia Bank Ltd.		827,593
	42,901	Westpac Banking Corp.		987,084
				3,910,834
		Commercial Services & Supplies
	21,517	Brambles Ltd.		154,450
		Construction & Engineering
	2,526	Leighton Holdings Ltd.		79,675
		Containers & Packaging
	19,058	Amcor Ltd.		131,073
		Diversified Financial Services
	2,973	ASX Ltd.		110,751
		Diversified Telecommunication Services
	74,883	Telstra Corp., Ltd.		209,513
		Energy Equipment & Services
	3,060	WorleyParsons Ltd.		84,773
		Food & Staples Retailing
	15,794	Wesfarmers Ltd.		535,627
	2,975	Wesfarmers Ltd. (PPS)		102,316
	19,351	Woolworths Ltd.		515,694
				1,153,637
		Health Care Equipment & Supplies
	963	Cochlear Ltd.		74,243
		Health Care Providers & Services
	5,936	Sonic Healthcare Ltd.		70,774
		Hotels, Restaurants & Leisure
	11,102	Crown Ltd.		95,331
	10,695	TABCORP Holdings Ltd.		74,261
				169,592
		Information Technology Services
	8,106	Computershare Ltd.		81,700
		Insurance
	36,890	AMP Ltd.		196,447
	16,910	AXA Asia Pacific Holdings Ltd.		108,618
	38,253	Insurance Australia Group Ltd.		145,514
	20,506	QBE Insurance Group Ltd.		358,704
	19,706	Suncorp Group Ltd.		169,038
				978,321
		Media
	48,903	Fairfax Media Ltd.		66,040
		Metals & Mining
	55,519	Alumina Ltd.		132,722
	50,465	BHP Billiton Ltd.		2,242,743
	33,335	BlueScope Steel Ltd.		70,798

See Notes to Financial Statements

8

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
	20,937	Fortescue Metals Group Ltd. (a)	$	134,366
	7,192	Newcrest Mining Ltd.		269,028
	21,424	OneSteel Ltd.		58,405
	6,652	Rio Tinto Ltd.		566,724
				3,474,786
		Multi-Utilities
	6,836	AGL Energy Ltd.		101,401
		Oil, Gas & Consumable Fuels
	13,584	Origin Energy Ltd.		223,221
	13,674	Santos Ltd.		184,922
	8,905	Woodside Petroleum Ltd.		371,312
				779,455
		Real Estate Investment Trusts (REITs)
	81,393	Dexus Property Group (Stapled Securities) (b)		67,500
	100,489	Goodman Group (Stapled Securities) (b)		66,757
	33,564	GPT Group (Stapled Securities) (b)		99,163
	48,193	Mirvac Group (Stapled Securities) (b)(c)		59,704
	35,586	Stockland (Stapled Securities) (b)(c)		127,932
	32,351	Westfield Group (Stapled Securities) (b)(c)		316,958
	32,351	Westfield Retail Trust (a)		85,435
				823,449
		Real Estate Management & Development
	11,065	Lend Lease Group (Stapled Securities) (b)(c)		97,384
		Road & Rail
	45,245	Asciano Ltd. (Stapled Securities) (a)(b)(c)		72,571
		Transportation Infrastructure
	20,053	Transurban Group (Stapled Securities) (b)		104,516
		Total Australia		13,949,459
		Austria (0.0%)
		Commercial Banks
	2,163	Erste Group Bank AG		108,383
		Metals & Mining
	1,329	Voestalpine AG		59,782
		Real Estate Management & Development
	3,664	Immofinanz AG (a)		16,171
		Total Austria		184,336
		Belgium (0.2%)
		Beverages
	7,523	Anheuser-Busch InBev N.V.		416,215
		Chemicals
	1,567	Umicore SA		80,565
		Commercial Banks
	1,156	KBC Groep N.V. (a)		46,242
		Diversified Financial Services
	2,466	Groupe Bruxelles Lambert SA		221,951
		Food & Staples Retailing
	3,851	Delhaize Group SA		304,524
		Insurance
	25,432	Ageas		72,020
		Total Belgium		1,141,517
		Bermuda (0.1%)
		Capital Markets
	2,299	Invesco Ltd.		56,877
		Distributors
	20,000	Li & Fung Ltd. (d)		130,153
		Energy Equipment & Services
	5,089	Seadrill Ltd.		167,213

See Notes to Financial Statements

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Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Food Products
	700	Bunge Ltd.	$	47,649
		Insurance
	3,854	Partnerre Ltd.		315,566
		Real Estate Management & Development
	7,000	Kerry Properties Ltd. (d)		37,281
		Specialty Retail
	7,900	Esprit Holdings Ltd. (d)		37,469
		Total Bermuda		792,208
		Brazil (0.4%)
		Commercial Banks
	7,700	Banco do Brasil SA		137,468
	7,600	Banco Santander Brasil SA (Units) (c)		88,130
				225,598
		Diversified Financial Services
	18,100	BM&F Bovespa SA		126,498
		Food Products
	9,300	BRF – Brasil Foods SA		152,587
		Household Durables
	3,500	Cyrela Brazil Realty SA Empreendimentos e Participacoes		38,654
	10,800	PDG Realty SA Empreendimentos e Participacoes		59,736
				98,390
		Information Technology Services
	8,500	Cielo SA		63,076
	5,100	Redecard SA		63,026
				126,102
		Metals & Mining
	13,100	Cia Siderurgica Nacional SA		217,685
	4,100	Usinas Siderurgicas de Minas Gerais SA		61,465
	18,100	Vale SA		619,783
				898,933
		Oil, Gas & Consumable Fuels
	17,000	OGX Petroleo e Gas Participacoes SA (a)		175,512
	31,100	Petroleo Brasileiro SA		560,638
				736,150
		Personal Products
	3,800	Natura Cosmeticos SA		97,339
		Road & Rail
	5,500	All America Latina Logistica SA		46,456
		Transportation Infrastructure
	3,700	Cia de Concessoes Rodoviarias		102,169
		Total Brazil		2,610,222
		Canada (2.6%)
		Aerospace & Defense
	19,400	Bombardier, Inc.		110,431
		Auto Components
	3,400	Magna International, Inc. (Class A)		198,530
		Capital Markets
	2,800	IGM Financial, Inc.		118,868
		Chemicals
	2,200	Agrium, Inc.		194,372
	3,800	Potash Corp. of Saskatchewan, Inc.		673,211
				867,583

See Notes to Financial Statements

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Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Commercial Banks
	7,100	Bank of Montreal	$	409,685
	12,400	Bank of Nova Scotia		699,160
	5,200	Canadian Imperial Bank of Commerce		396,069
	2,100	National Bank of Canada		146,403
	17,100	Royal Bank of Canada		916,691
	11,300	Toronto-Dominion Bank (The)		845,906
				3,413,914
		Communications Equipment
	6,300	Research In Motion Ltd. (a)		371,136
		Construction & Engineering
	2,800	SNC-Lavalin Group, Inc.		164,055
		Diversified Telecommunication Services
	7,200	BCE, Inc.		261,511
		Electric Utilities
	2,000	Fortis, Inc.		68,907
		Food & Staples Retailing
	3,500	Shoppers Drug Mart Corp.		128,836
		Hotels, Restaurants & Leisure
	4,300	Tim Hortons, Inc.		175,976
		Independent Power Producers & Energy Traders
	3,400	TransAlta Corp.		70,217
		Insurance
	300	Fairfax Financial Holdings Ltd.		114,445
	6,200	Great-West Lifeco, Inc.		160,611
	1,900	Intact Financial Corp.		95,726
	24,700	Manulife Financial Corp.		430,434
	5,500	Power Corp. of Canada		148,245
	5,200	Power Financial Corp.		154,699
	8,000	Sun Life Financial, Inc.		251,740
				1,355,900
		Media
	5,200	Shaw Communications, Inc.		109,780
	5,100	Thomson Reuters Corp.		203,725
				313,505
		Metals & Mining
	2,300	Agnico-Eagle Mines Ltd.		157,429
	13,100	Barrick Gold Corp.		621,019
	7,400	Eldorado Gold Corp.		118,905
	1,400	First Quantum Minerals Ltd.		161,971
	9,800	Goldcorp, Inc.		393,331
	11,900	Kinross Gold Corp.		198,016
	4,800	Silver Wheaton Corp. (a)		148,072
	6,500	Teck Resources Ltd.		393,694
	10,100	Yamana Gold, Inc.		113,674
				2,306,111
		Oil, Gas & Consumable Fuels
	5,600	Cameco Corp.		232,143
	14,400	Canadian Natural Resources Ltd.		642,093
	3,500	Canadian Oil Sands Ltd.		96,085
	10,000	Cenovus Energy, Inc.		345,534
	2,700	Crescent Point Energy Corp.		119,314
	5,800	Enbridge, Inc.		336,294
	10,500	Encana Corp.		338,378
	3,600	Husky Energy, Inc.		97,069
	3,500	Imperial Oil Ltd.		156,064
	8,200	Nexen, Inc.		205,952
	5,700	Penn West Petroleum Ltd.		155,913
	1,400	Petrobank Energy & Resources Ltd. (a)		32,856
	861	Petrominerales Ltd.		33,568
	19,800	Suncor Energy, Inc.		819,801
	14,200	Talisman Energy, Inc.		325,309
	8,800	TransCanada Corp.		321,206
	822	Ultra Petroleum Corp. (a)		39,234
				4,296,813
		Real Estate Management & Development
	7,500	Brookfield Asset Management, Inc. (Class A)		244,919

See Notes to Financial Statements

11

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
	5,800	Brookfield Properties Corp.	$	101,769
				346,688
		Road & Rail
	6,100	Canadian National Railway Co.		413,570
	2,300	Canadian Pacific Railway Ltd.		154,283
				567,853
		Wireless Telecommunication Services
	5,400	Rogers Communications, Inc. (Class B)		188,583
		Total Canada		15,325,417
		Cayman Islands (0.0%)
		Hotels, Restaurants & Leisure
	28,400	Sands China Ltd. (a)(d)		70,379
		Cyprus (0.0%)
		Commercial Banks
	12,308	Bank of Cyprus Public Co. Ltd.		52,099
		Denmark (0.2%)
		Beverages
	2,249	Carlsberg A/S (Class B)		223,985
		Chemicals
	552	Novozymes A/S (B Shares)		76,555
		Commercial Banks
	9,499	Danske Bank A/S (a)		254,919
		Electrical Equipment
	2,982	Vestas Wind Systems A/S (a)		102,789
		Marine
	25	A P Moller-Maersk A/S (Class B)		242,927
		Pharmaceuticals
	1,930	Novo Nordisk A/S (Class B)		217,980
		Total Denmark		1,119,155
		Finland (0.2%)
		Auto Components
	1,220	Nokian Renkaat OYJ		44,155
		Communications Equipment
	41,228	Nokia Oyj		441,229
		Electric Utilities
	6,095	Fortum Oyj		187,826
		Insurance
	4,004	Sampo Oyj (Class A)		117,803
		Machinery
	2,572	Kone Oyj (Class B)		140,136
		Paper & Forest Products
	11,434	UPM-Kymmene Oyj		235,909
		Total Finland		1,167,058
		France (1.9%)
		Aerospace & Defense
	1,262	Thales SA		46,882
		Auto Components
	1,913	Compagnie Generale des Etablissements Michelin (Class B)		139,228
		Automobiles
	745	Renault SA (a)		48,690
		Beverages
	1,992	Pernod-Ricard SA		189,824
		Building Products
	2,518	Compagnie de Saint-Gobain		145,751
		Chemicals
	3,073	Air Liquide SA		383,615
		Commercial Banks
	16,294	BNP Paribas		1,217,913
	10,819	Credit Agricole SA		160,004
	12,827	Societe Generale		829,337
				2,207,254

See Notes to Financial Statements

12

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Construction & Engineering
	2,866	Bouygues SA	$	133,360
	5,492	Vinci SA		317,701
				451,061
		Construction Materials
	3,982	Lafarge SA		235,841
		Diversified Telecommunication Services
	23,872	France Telecom SA		521,782
		Electric Utilities
	3,650	EDF SA		160,820
		Electrical Equipment
	4,172	Alstom SA		233,002
		Energy Equipment & Services
	1,665	Technip SA		161,681
		Food & Staples Retailing
	5,630	Carrefour SA		276,002
		Food Products
	5,340	Danone SA		321,430
		Health Care Equipment & Supplies
	1,811	Cie Generale d’Optique Essilor International SA		121,021
		Hotels, Restaurants & Leisure
	1,449	Sodexo		99,809
		Information Technology Services
	2,091	Cap Gemini SA		105,588
		Insurance
	16,930	AXA SA		358,316
		Machinery
	2,524	Vallourec SA		274,353
		Media
	1,498	Publicis Groupe SA		77,124
	17,315	Vivendi SA		495,923
				573,047
		Multi-Utilities
	12,698	GDF Suez		503,598
	4,572	Suez Environnement Co.		94,578
	5,313	Veolia Environnement SA		165,970
				764,146
		Multiline Retail
	1,608	PPR		257,191
		Oil, Gas & Consumable Fuels
	20,458	Total SA		1,197,277
		Personal Products
	2,915	L’Oreal SA		338,678
		Pharmaceuticals
	11,473	Sanofi-Aventis SA		782,718
		Real Estate Investment Trusts (REITs)
	86	ICADE		9,333
	1,957	Unibail-Rodamco SE		373,795
				383,128
		Textiles, Apparel & Luxury Goods
	1,036	Christian Dior SA		142,332
	506	Hermes International		102,180
	3,032	LVMH Moet Hennessy Louis Vuitton SA		473,095
				717,607
		Total France		11,495,742
		Germany (1.6%)
		Air Freight & Logistics
	15,717	Deutsche Post AG (Registered Shares)		288,599
		Auto Components
	532	Continental AG (a)		41,848

See Notes to Financial Statements

13

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Automobiles
	3,513	Bayerische Motoren Werke AG	$	269,571
	6,743	Daimler AG (a)		492,970
	324	Volkswagen AG		49,229
				811,770
		Capital Markets
	11,650	Deutsche Bank AG (Registered Shares)		687,887
		Chemicals
	11,615	BASF SE		893,703
	1,711	K+S AG		126,369
	1,060	Lanxess AG		77,093
	1,898	Linde AG		276,694
				1,373,859
		Commercial Banks
	17,501	Commerzbank AG (a)		133,248
		Diversified Financial Services
	1,518	Deutsche Boerse AG		115,073
		Diversified Telecommunication Services
	38,920	Deutsche Telecom AG (Registered Shares)		518,740
		Electric Utilities
	20,153	E.ON AG		672,774
		Health Care Providers & Services
	2,175	Fresenius Medical Care AG & Co. KGaA		127,282
	1,482	Fresenius SE & Co. KGaA		129,214
				256,496
		Household Products
	2,028	Henkel AG & Co. KGaA		104,268
		Industrial Conglomerates
	10,081	Siemens AG (Registered Shares)		1,291,470
		Insurance
	5,106	Allianz SE (Registered Shares)		709,282
	2,137	Muenchener Rueckversicherungs AG (Registered Shares)		334,769
				1,044,051
		Metals & Mining
	5,591	ThyssenKrupp AG		226,728
		Multi-Utilities
	4,067	RWE AG		292,869
		Personal Products
	1,091	Beiersdorf AG		59,770
		Pharmaceuticals
	8,038	Bayer AG (Registered Shares)		592,773
		Semiconductors & Semiconductor Equipment
	14,309	Infineon Technologies AG (a)		151,302
		Software
	13,756	SAP AG		794,653
		Textiles, Apparel & Luxury Goods
	2,893	Adidas AG		180,142
		Total Germany		9,638,320
		Greece (0.0%)
		Commercial Banks
	6,517	Alpha Bank AE (a)		38,159
	10,866	National Bank of Greece SA (a)		104,946
		Total Greece		143,105
		Hong Kong (0.4%)
		Commercial Banks
	15,200	Bank of East Asia Ltd.		65,722
	36,500	BOC Hong Kong Holdings Ltd.		117,347
	11,500	Hang Seng Bank Ltd.		190,339
				373,408
		Diversified Financial Services
	9,700	Hong Kong Exchanges and Clearing Ltd.		224,070

See Notes to Financial Statements

14

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Electric Utilities
	19,000	CLP Holdings Ltd.	$	154,391
	14,500	Hongkong Electric Holdings Ltd.		91,827
				246,218
		Gas Utilities
	36,000	Hong Kong & China Gas Co., Ltd.		81,575
		Industrial Conglomerates
	21,000	Hutchison Whampoa Ltd.		246,012
		Insurance
	67,200	AIA Group Ltd. (a)		185,687
		Real Estate Investment Trusts (REITs)
	19,000	Link REIT (The)		59,738
		Real Estate Management & Development
	14,000	Cheung Kong Holdings Ltd.		231,672
	8,000	Hang Lung Group Ltd.		50,760
	22,000	Hang Lung Properties Ltd.		96,253
	11,000	Henderson Land Development Co., Ltd.		76,065
	26,000	New World Development Ltd.		49,025
	18,000	Sino Land Co., Ltd.		34,176
	13,000	Sun Hung Kai Properties Ltd.		216,037
	6,500	Swire Pacific Ltd. (Class A)		102,667
	12,000	Wharf Holdings Ltd.		91,065
	10,000	Wheelock & Co. Ltd.		40,378
				988,098
		Road & Rail
	15,000	MTR Corp.		54,694
		Total Hong Kong		2,459,500
		Indonesia (0.2%)
		Automobiles
	29,000	Astra International Tbk PT		156,828
		Commercial Banks
	169,000	Bank Central Asia Tbk PT		105,603
	46,500	Bank Danamon Indonesia Tbk PT		30,599
	103,500	Bank Mandiri Tbk PT		68,108
	70,000	Bank Negara Indonesia Persero Tbk PT		24,969
	161,000	Bank Rakyat Indonesia Persero Tbk PT		86,929
				316,208
		Construction Materials
	20,500	Indocement Tunggal Prakarsa Tbk PT		30,701
	56,000	Semen Gresik Persero Tbk PT		47,984
				78,685
		Diversified Telecommunication Services
	131,000	Telekomunikasi Indonesia Tbk PT		109,567
		Food Products
	69,000	Indofood Sukses Makmur Tbk PT		35,846
		Gas Utilities
	159,000	Perusahaan Gas Negara PT		74,633
		Household Products
	19,000	Unilever Indonesia Tbk PT		31,618
		Machinery
	23,000	United Tractors Tbk PT		54,283
		Oil, Gas & Consumable Fuels
	153,800	Adaro Energy Tbk PT		38,259
	257,500	Bumi Resources Tbk PT		78,862
	6,000	Indo Tambangraya Megah PT		30,713
	12,500	Tambang Batubara Bukit Asam Tbk PT		27,292
				175,126
		Tobacco
	9,500	Gudang Garam Tbk PT		39,128
		Total Indonesia		1,071,922

See Notes to Financial Statements

15

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Ireland (0.1%)
		Health Care Equipment & Supplies
	7,518	Covidien PLC	$	356,879
		Information Technology Services
	4,600	Accenture Ltd. (Class A)		236,762
		Machinery
	600	Ingersoll-Rand PLC		28,320
		Total Ireland		621,961
		Israel (0.4%)
		Pharmaceuticals
	44,100	Teva Pharmaceutical Industries Ltd. (ADR)		2,410,065
		Italy (0.5%)
		Aerospace & Defense
	4,799	Finmeccanica SpA		64,808
		Automobiles
	5,386	Fiat SpA		52,430
		Commercial Banks
	96,344	Intesa Sanpaolo SpA		320,501
	84,588	UniCredit SpA		209,484
	8,530	Unione di Banche Italiane ScpA		88,307
				618,292
		Diversified Telecommunication Services
	302,129	Telecom Italia SpA		396,119
		Electric Utilities
	81,439	Enel SpA		460,168
		Energy Equipment & Services
	4,324	Saipem SpA		216,797
		Gas Utilities
	44,069	Snam Rete Gas SpA		231,204
		Insurance
	14,818	Assicurazioni Generali SpA		323,164
		Machinery
	5,386	Fiat Industrial SpA (a)		72,894
		Oil, Gas & Consumable Fuels
	31,470	Eni SpA		744,943
		Total Italy		3,180,819
		Japan (4.8%)
		Air Freight & Logistics
	9,000	Yamato Holdings Co., Ltd.		136,305
		Auto Components
	3,700	Aisin Seiki Co., Ltd.		140,163
	9,000	Bridgestone Corp.		172,514
	8,500	Denso Corp.		312,192
	3,600	Toyota Industries Corp.		114,325
				739,194
		Automobiles
	20,695	Honda Motor Co., Ltd. (ADR)		901,060
	24,000	Mazda Motor Corp.		70,579
	97,000	Mitsubishi Motors Corp. (a)		134,515
	33,300	Nissan Motor Co., Ltd.		335,862
	5,600	Suzuki Motor Corp.		135,153
	38,200	Toyota Motor Corp.		1,579,969
				3,157,138
		Beverages
	4,800	Asahi Breweries Ltd.		89,995
	13,000	Kirin Holdings Co., Ltd.		174,626
				264,621
		Building Products
	15,000	Asahi Glass Co., Ltd.		186,536
	3,500	Daikin Industries Ltd.		121,633
	5,300	JS Group Corp.		115,711
				423,880
		Capital Markets
	31,000	Daiwa Securities Group, Inc.		152,598
	49,000	Nomura Holdings, Inc.		297,119
				449,717

See Notes to Financial Statements

16

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Chemicals
	26,000	Asahi Kasei Corp.	$	177,098
	3,000	JSR Corp.		61,688
	5,000	Kuraray Co., Ltd.		70,041
	20,000	Mitsubishi Chemical Holdings Corp.		139,148
	2,200	Nitto Denko Corp.		109,383
	4,300	Shin-Etsu Chemical Co., Ltd.		241,485
	22,000	Sumitomo Chemical Co., Ltd.		114,327
	26,000	Toray Industries, Inc.		172,078
				1,085,248
		Commercial Banks
	22,000	Bank of Yokohama Ltd. (The)		109,965
	14,000	Chiba Bank Ltd. (The)		87,009
	193,500	Mizuho Financial Group, Inc.		371,771
	7,600	Resona Holdings, Inc.		39,123
	12,000	Shizuoka Bank Ltd. (The)		109,804
	18,100	Sumitomo Mitsui Financial Group, Inc.		614,629
	25,000	Sumitomo Trust & Banking Co., Ltd. (The)		150,511
				1,482,812
		Commercial Services & Supplies
	11,000	Dai Nippon Printing Co., Ltd.		150,051
	2,800	Secom Co., Ltd.		131,811
	11,000	Toppan Printing Co., Ltd.		99,779
				381,641
		Computers & Peripherals
	25,000	Fujitsu Ltd.		155,374
	58,000	Toshiba Corp.		342,209
				497,583
		Construction & Engineering
	3,000	JGC Corp.		73,532
		Diversified Financial Services
	1,380	ORIX Corp.		135,864
		Diversified Telecommunication Services
	8,000	Nippon Telegraph & Telephone Corp.		371,721
		Electric Utilities
	7,800	Chubu Electric Power Co., Inc.		194,916
	3,700	Chugoku Electric Power Co., Inc. (The)		76,710
	4,200	Hokkaido Electric Power Co., Inc.		87,257
	3,900	Hokuriku Electric Power Co.		95,093
	6,200	Kansai Electric Power Co., Inc. (The)		153,260
	3,900	Kyushu Electric Power Co., Inc.		87,665
	5,800	Shikoku Electric Power Co.		171,315
	6,600	Tohoku Electric Power Co., Inc.		146,697
	13,700	Tokyo Electric Power Co., Inc. (The)		332,933
				1,345,846
		Electrical Equipment
	27,000	Mitsubishi Electric Corp.		297,221
	1,400	Nidec Corp.		131,652
	23,800	Sumitomo Electric Industries Ltd.		344,771
				773,644
		Electronic Equipment, Instruments & Components
	7,800	FUJIFILM Holdings Corp.		283,378
	66,000	Hitachi Ltd.		365,714
	5,000	Hoya Corp.		117,557
	2,000	Ibiden Co., Ltd.		67,400
	600	Keyence Corp.		158,913
	2,100	Kyocera Corp.		217,960
	2,900	Murata Manufacturing Co., Ltd.		219,317
	6,000	Nippon Electric Glass Co., Ltd.		90,027
	2,800	Omron Corp.		71,866
	1,400	TDK Corp.		91,670
				1,683,802

See Notes to Financial Statements

17

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Food & Staples Retailing
	11,600	Aeon Co., Ltd.	$	145,656
	11,300	Seven & I Holdings Co., Ltd.		291,950
				437,606
		Food Products
	15,000	Ajinomoto Co., Inc.		165,921
		Gas Utilities
	38,000	Osaka Gas Co., Ltd.		143,690
	34,000	Tokyo Gas Co., Ltd.		148,193
				291,883
		Health Care Equipment & Supplies
	3,500	Olympus Corp.		97,913
	2,900	Terumo Corp.		149,842
				247,755
		Household Durables
	25,300	Panasonic Corp.		345,800
	12,000	Sekisui House Ltd.		116,637
	15,000	Sharp Corp.		155,143
	13,635	Sony Corp. (ADR)		468,226
				1,085,806
		Household Products
	2,400	Unicharm Corp.		92,768
		Independent Power Producers & Energy Traders
	2,700	Electric Power Development Co., Ltd.		83,657
		Industrial Conglomerates
	31,000	Hankyu Hanshin Holdings, Inc.		143,367
		Information Technology Services
	30	NTT Data Corp.		97,269
		Insurance
	5,000	MS&AD Insurance Group Holdings		118,666
	4,200	T&D Holdings, Inc.		105,322
	6,500	Tokio Marine Holdings, Inc.		193,328
				417,316
		Internet & Catalog Retail
	139	Rakuten, Inc.		122,180
		Internet Software & Services
	276	Yahoo! Japan Corp.		103,941
		Leisure Equipment & Products
	4,600	Nikon Corp.		106,287
		Machinery
	2,500	Fanuc Ltd.		393,747
	5,000	Japan Steel Works Ltd. (The)		52,487
	38,000	Kawasaki Heavy Industries Ltd.		134,919
	13,600	Komatsu Ltd.		403,990
	18,000	Kubota Corp.		183,808
	1,600	Makita Corp.		69,145
	49,000	Mitsubishi Heavy Industries Ltd.		193,720
	5,000	NGK Insulators Ltd.		84,109
	10,000	NSK Ltd.		95,520
	800	SMC Corp.		135,072
				1,746,517
		Marine
	18,000	Mitsui O.S.K. Lines Ltd.		117,069
	34,000	Nippon Yusen KK		148,454
				265,523
		Media
	3,200	Dentsu, Inc.		97,275
		Metals & Mining
	5,800	JFE Holdings, Inc.		187,133
	73,000	Kobe Steel Ltd.		178,421
	74,000	Nippon Steel Corp.		251,958
	49,000	Sumitomo Metal Industries Ltd.		114,395

See Notes to Financial Statements

18

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES				VALUE
	8,000	Sumitomo Metal Mining Co., Ltd.		$	132,417
					864,324
			��
		Multiline Retail
	5,400	Isetan Mitsukoshi Holdings Ltd.			60,482
		Office Electronics
	14,400	Canon, Inc.			704,413
	5,000	Konica Minolta Holdings, Inc.			48,107
	11,000	Ricoh Co., Ltd.			156,294
					908,814
		Oil, Gas & Consumable Fuels
	12	INPEX Corp.			78,255
		Paper & Forest Products
	13,000	OJI Paper Co., Ltd.			60,821
		Personal Products
	8,100	Kao Corp.			211,333
	6,500	Shiseido Co., Ltd.			130,615
					341,948
		Pharmaceuticals
	5,100	Astellas Pharma, Inc.			194,485
	4,900	Chugai Pharmaceutical Co., Ltd.			90,079
	9,700	Daiichi Sankyo Co., Ltd.			210,374
	3,800	Eisai Co., Ltd.			131,484
	1,500	Ono Pharmaceutical Co., Ltd.			72,872
	6,400	Shionogi & Co., Ltd.			117,403
	10,200	Takeda Pharmaceutical Co., Ltd.			490,438
					1,307,135
		Real Estate Investment Trusts (REITs)
	8	Japan Real Estate Investment Corp.			80,234
	8	Nippon Building Fund, Inc.			83,955
					164,189
		Real Estate Management & Development
	1,400	Daito Trust Construction Co., Ltd.			97,955
	11,000	Daiwa House Industry Co., Ltd.			133,873
	16,000	Mitsubishi Estate Co., Ltd.			301,505
	12,000	Mitsui Fudosan Co., Ltd.			243,270
	7,000	Sumitomo Realty & Development Co., Ltd.			170,955
					947,558
		Road & Rail
	23	Central Japan Railway Co.			194,038
	4,800	East Japan Railway Co.			316,669
	10,000	Keikyu Corp.			85,669
	10,000	Keio Corp.			67,087
	41,000	Kintetsu Corp.			126,686
	22,000	Nippon Express Co., Ltd.			92,555
	16,000	Odakyu Electric Railway Co., Ltd.			148,218
	33,000	Tobu Railway Co., Ltd.			182,204
	18,000	Tokyu Corp.			81,512
	28	West Japan Railway Co.			106,737
					1,401,375
		Semiconductors & Semiconductor Equipment
	2,300	Advantest Corp.			46,902
	1,200	Rohm Co., Ltd.			77,765
	2,000	Tokyo Electron Ltd.			129,963
					254,630
		Software
	1,300	Nintendo Co., Ltd.			350,907
	1,800	Trend Micro, Inc.			54,170
					405,077
		Specialty Retail
	600	Fast Retailing Co., Ltd.			87,323
	1,370	Yamada Denki Co., Ltd.			92,818
					180,141
		Tobacco
	82	Japan Tobacco, Inc.			307,492

See Notes to Financial Statements

19

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Trading Companies & Distributors
	22,000	ITOCHU Corp.	$	238,487
	30,000	Marubeni Corp.		224,966
	17,700	Mitsubishi Corp.		491,551
	27,100	Mitsui & Co., Ltd.		454,526
	16,000	Sumitomo Corp.		229,602
				1,639,132
		Wireless Telecommunication Services
	53	KDDI Corp.		298,521
	202	NTT DoCoMo, Inc.		360,287
	10,200	Softbank Corp.		350,195
				1,009,003
		Total Japan		28,437,995
		Luxembourg (0.2%)
		Energy Equipment & Services
	11,243	Tenaris SA		264,600
		Media
	3,534	SES SA (FDR)		85,206
		Metals & Mining
	554	APERAM (a)		22,725
	11,084	ArcelorMittal		405,203
				427,928
		Wireless Telecommunication Services
	1,571	Millicom International Cellular SA (Class B) (SDR)		148,666
		Total Luxembourg		926,400
		Netherlands (0.5%)
		Air Freight & Logistics
	5,630	TNT N.V.		152,786
		Beverages
	3,777	Heineken N.V.		190,092
		Chemicals
	3,681	Akzo Nobel N.V.		230,107
	2,836	Koninklijke DSM N.V.		167,840
				397,947
		Diversified Financial Services
	52,586	ING Groep N.V. (Share Certificates) (a)		598,810
		Diversified Telecommunication Services
	6,736	Koninklijke KPN N.V.		106,315
		Food & Staples Retailing
	13,650	Koninklijke Ahold N.V.		184,932
		Food Products
	16,035	Unilever N.V. (Share Certificates)		474,173
		Industrial Conglomerates
	11,837	Koninklijke Philips Electronics N.V.		368,563
		Insurance
	18,161	Aegon N.V. (a)		134,374
		Life Sciences Tools & Services
	1,783	QIAGEN N.V. (a)		32,859
		Semiconductors & Semiconductor Equipment
	4,991	ASML Holding N.V.		209,288
	9,589	STMicroelectronics N.V.		115,949
				325,237
		Total Netherlands		2,966,088
		Netherlands Antilles (0.1%)
		Energy Equipment & Services
	5,180	Schlumberger Ltd.		460,968
		Norway (0.2%)
		Chemicals
	2,032	Yara International ASA		114,774

See Notes to Financial Statements

20

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Commercial Banks
	10,219	DnB NOR ASA	$	140,661
		Diversified Telecommunication Services
	18,879	Telenor ASA		291,483
		Industrial Conglomerates
	9,837	Orkla ASA		88,533
		Metals & Mining
	12,763	Norsk Hydro ASA		96,143
		Oil, Gas & Consumable Fuels
	15,370	Statoil ASA		372,931
		Total Norway		1,104,525
		Panama (0.0%)
		Hotels, Restaurants & Leisure
	2,800	Carnival Corp. (Units) (c)		125,188
		Portugal (0.0%)
		Diversified Telecommunication Services
	13,277	Portugal Telecom SGPS SA		153,888
		Russia (0.6%)
		Commercial Banks
	1,209	Sberbank of Russia (Registered GDR)		475,138
	20,706	VTB Bank OJSC (Registered GDR)		148,126
				623,264
		Electric Utilities
	24,753	Federal Hydrogenerating Co., JSC (ADR) (a)		122,627
		Food & Staples Retailing
	5,653	Magnit OJSC (Registered GDR)		147,795
		Metals & Mining
	14,442	MMC Norilsk Nickel OJSC (ADR)		367,794
		Oil, Gas & Consumable Fuels
	40,668	Gazprom OAO (ADR)		1,080,236
	7,367	LUKOIL OAO (ADR)		452,330
	1,263	NovaTek OAO (Registered GDR)		143,057
	29,988	Rosneft Oil Co. (Registered GDR)		257,330
	15,000	Surgutneftegas OJSC (ADR)		166,548
	5,085	Tatneft (ADR)		180,907
				2,280,408
		Wireless Telecommunication Services
	9,100	Mobile Telesystems OJSC (ADR)		173,901
		Total Russia		3,715,789
		Spain (0.5%)
		Commercial Banks
	44,931	Banco Bilbao Vizcaya Argentaria SA		551,566
	15,334	Banco de Sabadell SA		73,326
	11,850	Banco Popular Espanol SA		71,252
	86,111	Banco Santander SA		1,055,063
				1,751,207
		Construction & Engineering
	3,368	ACS Actividades de Construccion y Servicios SA		173,829
		Electric Utilities
	39,552	Iberdrola SA		338,773
	1,447	Red Electrica Corp. SA		73,788
				412,561
		Oil, Gas & Consumable Fuels
	11,584	Repsol YPF SA		365,361
		Specialty Retail
	2,617	Inditex SA		197,849
		Transportation Infrastructure
	5,015	Abertis Infraestructuras SA		98,367
		Total Spain		2,999,174

See Notes to Financial Statements

21

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Sweden (0.7%)
		Building Products
	3,231	Assa Abloy AB (B Shares)	$	87,869
		Commercial Banks
	33,576	Nordea Bank AB		407,232
	15,823	Skandinaviska Enskilda Banken AB		143,632
	5,790	Svenska Handelsbanken AB (Class A)		197,116
	3,414	Swedbank AB (Class A) (a)		53,565
				801,545
		Communications Equipment
	51,697	Telefonaktiebolaget LM Ericsson (Class B)		638,075
		Construction & Engineering
	3,281	Skanska AB (Class B)		66,535
		Diversified Financial Services
	5,631	Investor AB (Class B)		130,170
		Diversified Telecommunication Services
	38,075	TeliaSonera AB		314,041
		Household Durables
	2,950	Electrolux AB (Series B)		83,916
		Machinery
	10,060	Atlas Copco AB (Class A)		241,560
	7,272	Atlas Copco AB (Class B)		158,369
	15,503	Sandvik AB		304,529
	5,103	Scania AB (Class B)		114,524
	6,383	SKF AB (Class B)		183,008
	8,385	Volvo AB (Class B) (a)		145,938
				1,147,928
		Paper & Forest Products
	7,641	Svenska Cellulosa AB (Class B)		133,257
		Specialty Retail
	11,753	Hennes & Mauritz AB (Class B)		385,821
		Tobacco
	4,514	Swedish Match AB		129,915
		Total Sweden		3,919,072
		Switzerland (2.0%)
		Biotechnology
	170	Actelion Ltd. (Registered Shares) (a)		9,195
		Building Products
	880	Geberit AG (Registered Shares)		185,643
		Capital Markets
	19,305	Credit Suisse Group AG (Registered Shares)		863,041
	2,609	Julius Baer Group Ltd.		118,059
	33,359	UBS AG (Registered Shares) (a)		598,211
				1,579,311
		Chemicals
	100	Givaudan SA		98,981
	999	Syngenta AG (Registered Shares)		322,137
				421,118
		Diversified Telecommunication Services
	907	Swisscom AG (Registered Shares)		400,674
		Electrical Equipment
	38,275	ABB Ltd. (Registered Shares) (a)		902,948
		Electronic Equipment, Instruments & Components
	300	Tyco Electronics Ltd.		10,869
		Energy Equipment & Services
	900	Noble Corp.		34,425
	2,600	Transocean Ltd. (a)		207,818
	3,136	Weatherford International Ltd. (a)		74,386
				316,629
		Food Products
	40,372	Nestle SA (Registered Shares)		2,182,336

See Notes to Financial Statements

22

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Health Care Equipment & Supplies
	1,082	Sonova Holding AG	$	135,671
		Industrial Conglomerates
	19,399	Tyco International Ltd.		869,657
		Insurance
	1,700	ACE Ltd.		104,703
	3,700	Swiss Reinsurance Co., Ltd. (Registered Shares)		211,440
	2,602	Zurich Financial Services AG		710,832
				1,026,975
		Marine
	1,002	Kuehne & Nagel International AG (Registered Shares)		129,660
		Pharmaceuticals
	33,608	Novartis AG (Registered Shares)		1,874,035
	3,848	Roche Holding AG		585,122
				2,459,157
		Professional Services
	522	Adecco SA (Registered Shares)		33,793
	99	SGS SA (Registered Shares)		161,182
				194,975
		Textiles, Apparel & Luxury Goods
	13,634	Compagnie Financiere Richemont SA		740,765
	645	Swatch Group AG (The)		259,327
				1,000,092
		Total Switzerland		11,824,910
		Turkey (0.3%)
		Beverages
	7,195	Anadolu Efes Biracilik Ve Malt Sanayii		89,026
		Commercial Banks
	35,670	Akbank TAS		167,700
	14,774	Asya Katilim Bankasi		25,762
	61,214	Turkiye Garanti Bankasi		272,089
	10,204	Turkiye Halk Bankasi		80,367
	46,475	Turkiye Is Bankasi		145,832
	22,180	Turkiye Vakiflar Bankasi Tao		54,637
	28,213	Yapi ve Kredi Bankasi AS (a)		82,355
				828,742
		Diversified Financial Services
	18,654	Haci Omer Sabanci Holding		79,304
		Diversified Telecommunication Services
	17,659	Turk Telekomunikasyon		72,529
		Food & Staples Retailing
	2,843	BIM Birlesik Magazalar		91,359
		Industrial Conglomerates
	10,434	Enka Insaat ve Sanayi		39,426
	18,175	KOC Holding		74,090
				113,516
		Metals & Mining
	12,481	Eregli Demir ve Celik Fabrikalari TAS (a)		39,236
		Oil, Gas & Consumable Fuels
	4,038	Tupras Turkiye Petrol Rafine		104,631
		Wireless Telecommunication Services
	24,629	Turkcell Iletisim Hizmet		151,185
		Total Turkey		1,569,528
		United Kingdom (4.3%)
		Aerospace & Defense
	51,283	BAE Systems PLC		280,798
	33,837	Rolls-Royce Group PLC (a)		345,898
				626,696

See Notes to Financial Statements

23

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Beverages
	25,427	Diageo PLC	$	488,720
	9,364	SABMiller PLC		302,909
				791,629
		Chemicals
	2,668	Johnson Matthey PLC		82,469
		Commercial Banks
	316,184	Barclays PLC		1,486,764
	620,888	Lloyds Banking Group PLC (a)		628,312
	170,202	Royal Bank of Scotland Group PLC (a)		113,493
	35,115	Standard Chartered PLC		915,393
				3,143,962
		Commercial Services & Supplies
	4,047	Aggreko PLC		93,056
	19,148	G4S PLC		82,431
				175,487
		Diversified Telecommunication Services
	111,554	BT Group PLC		314,558
	4,106	Inmarsat PLC		44,849
				359,407
		Electric Utilities
	18,877	Scottish & Southern Energy PLC		350,339
		Food & Staples Retailing
	20,601	J Sainsbury PLC		125,963
	107,331	Tesco PLC		692,569
	27,190	WM Morrison Supermarkets PLC		116,089
				934,621
		Food Products
	13,574	Unilever PLC		394,728
		Health Care Equipment & Supplies
	12,145	Smith & Nephew PLC		136,155
		Hotels, Restaurants & Leisure
	7,417	Carnival PLC		338,433
	21,175	Compass Group PLC		188,306
				526,739
		Household Products
	7,050	Reckitt Benckiser Group PLC		383,208
		Industrial Conglomerates
	6,313	Smiths Group PLC		137,660
		Insurance
	32,256	Aviva PLC		230,290
	64,792	Legal & General Group PLC		115,199
	88,184	Old Mutual PLC		177,234
	29,483	Prudential PLC		319,381
	80,008	RSA Insurance Group PLC		174,265
	17,110	Standard Life PLC		62,969
				1,079,338
		Media
	10,825	British Sky Broadcasting Group PLC		130,895
	19,022	Pearson PLC		312,173
	29,210	WPP PLC		361,705
				804,773
		Metals & Mining
	13,867	Anglo American PLC		679,335
	2,716	Antofagasta PLC		61,491
	23,594	BHP Billiton PLC		904,453
	2,888	Kazakhmys PLC		69,581
	1,989	Lonmin PLC (a)		52,889
	1,094	Randgold Resources Ltd.		83,413
	15,350	Rio Tinto PLC		1,059,797
	1,623	Vedanta Resources PLC		59,166
	22,009	Xstrata PLC		487,345
				3,457,470
		Multi-Utilities
	58,907	Centrica PLC		301,748
	33,291	National Grid PLC		296,561
				598,309

See Notes to Financial Statements

24

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Multiline Retail
	2,134	Next PLC	$	67,617
		Oil, Gas & Consumable Fuels
	43,274	BG Group PLC		974,050
	195,978	BP PLC		1,523,358
	34,965	Cairn Energy PLC (a)		232,288
	36,599	Royal Dutch Shell PLC (Class A)		1,292,210
	28,956	Royal Dutch Shell PLC (Class B)		1,006,346
	14,184	Tullow Oil PLC		301,497
				5,329,749
		Pharmaceuticals
	15,088	AstraZeneca PLC		732,771
	76,463	GlaxoSmithKline PLC		1,382,985
	3,097	Shire PLC		81,765
				2,197,521
		Professional Services
	5,298	Capita Group PLC (The)		57,605
	9,618	Experian PLC		119,348
				176,953
		Real Estate Investment Trusts (REITs)
	15,365	British Land Co., PLC		127,707
	14,737	Land Securities Group PLC		159,332
				287,039
		Software
	2,989	Autonomy Corp. PLC (a)		71,647
		Specialty Retail
	25,204	Kingfisher PLC		101,675
		Tobacco
	20,371	British American Tobacco PLC		751,901
	10,877	Imperial Tobacco Group PLC		310,803
				1,062,704
		Trading Companies & Distributors
	3,532	Wolseley PLC (a)		123,099
		Wireless Telecommunication Services
	706,932	Vodafone Group PLC		1,986,883
		Total United Kingdom		25,387,877
		United States (26.9%)
		Aerospace & Defense
	3,897	Alliant Techsystems, Inc. (a)		295,237
	570	Boeing Co. (The)		39,603
	300	General Dynamics Corp.		22,620
	6,900	Honeywell International, Inc.		386,469
	2,100	ITT Corp.		123,732
	100	L-3 Communications Holdings, Inc.		7,825
	1,800	Lockheed Martin Corp.		143,280
	400	Northrop Grumman Corp.		27,720
	1,200	Precision Castparts Corp.		171,588
	16,706	Raytheon Co.		835,133
	1,200	Rockwell Collins, Inc.		76,968
	800	United Technologies Corp.		65,040
				2,195,215
		Auto Components
	19,416	Johnson Controls, Inc.		745,380
		Automobiles
	148,320	Ford Motor Co. (a)		2,365,704
		Beverages
	7,100	Coca-Cola Co. (The)		446,235
	39,800	PepsiCo, Inc.		2,559,538
				3,005,773
		Capital Markets
	3,400	Ameriprise Financial, Inc.		209,610
	8,800	Bank of New York Mellon Corp. (The)		274,824
	8,200	Franklin Resources, Inc.		989,330
	18,175	Goldman Sachs Group, Inc. (The)		2,973,793
	44,700	State Street Corp.		2,088,384
				6,535,941

See Notes to Financial Statements

25

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Chemicals
	2,251	CF Industries Holdings, Inc.	$	303,975
	15,138	EI Du Pont de Nemours & Co.		767,194
				1,071,169
		Commercial Banks
	9,100	BB&T Corp.		251,524
	9,800	Fifth Third Bancorp		145,726
	5,900	PNC Financial Services Group, Inc.		354,000
	65,828	Regions Financial Corp.		467,379
	20,231	SunTrust Banks, Inc.		615,629
	32,100	US Bancorp		866,700
	56,730	Wells Fargo & Co.		1,839,187
				4,540,145
		Commercial Services & Supplies
	1,700	Republic Services, Inc.		52,428
	1,800	Waste Management, Inc.		68,166
				120,594
		Communications Equipment
	133,470	Cisco Systems, Inc. (a)		2,822,890
	400	Juniper Networks, Inc. (a)		14,848
	2,650	Motorola Mobility Holdings, Inc. (a)		73,856
	971	Motorola Solutions, Inc. (a)		37,646
	1,000	QUALCOMM, Inc.		54,130
				3,003,370
		Computers & Peripherals
	635	Apple, Inc. (a)		215,468
	800	Dell, Inc. (a)		10,528
	1,350	EMC Corp. (a)		33,602
	800	Hewlett-Packard Co.		36,552
	13,422	International Business Machines Corp.		2,174,364
	200	NetApp, Inc. (a)		10,946
	7,300	SanDisk Corp. (a)		331,201
	79,300	Western Digital Corp. (a)		2,697,786
				5,510,447
		Construction & Engineering
	2,100	Fluor Corp.		145,299
	9,970	URS Corp. (a)		443,167
				588,466
		Containers & Packaging
	31,069	Sealed Air Corp.		829,232
		Distributors
	16,166	Genuine Parts Co.		836,590
		Diversified Consumer Services
	700	Apollo Group, Inc. (Class A) (a)		28,889
		Diversified Financial Services
	71,535	Bank of America Corp.		982,175
	95,580	Citigroup, Inc. (See Note 6) (a)		460,696
	47,385	JPMorgan Chase & Co.		2,129,482
				3,572,353
		Diversified Telecommunication Services
	47,400	AT&T, Inc.		1,304,448
	2,600	CenturyLink, Inc.		112,424
	9,600	Frontier Communications Corp.		88,032
	13,500	Qwest Communications International, Inc.		96,255
	44,276	Verizon Communications, Inc.		1,577,111
				3,178,270
		Electrical Equipment
	48,430	Emerson Electric Co.		2,851,558
		Electronic Equipment, Instruments & Components
	11,958	Arrow Electronics, Inc. (a)		452,013
	123,325	Corning, Inc.		2,739,048
				3,191,061
		Energy Equipment & Services
	1,694	Baker Hughes, Inc.		116,056
	978	Cameron International Corp. (a)		52,127
	209	FMC Technologies, Inc. (a)		19,646

See Notes to Financial Statements

26

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
	17,927	Halliburton Co.	$	806,715
	1,365	National Oilwell Varco, Inc.		100,874
	62,100	Tidewater, Inc.		3,694,329
				4,789,747
		Food & Staples Retailing
	3,310	Costco Wholesale Corp.		237,790
	10,300	CVS Caremark Corp.		352,260
	2,200	Kroger Co. (The)		47,080
	2,600	Safeway, Inc.		53,794
	2,800	Sysco Corp.		81,592
	27,100	Wal-Mart Stores, Inc.		1,519,497
	7,900	Walgreen Co.		319,476
				2,611,489
		Food Products
	1,400	Archer-Daniels-Midland Co.		45,738
	41,583	ConAgra Foods, Inc.		928,549
	4,871	JM Smucker Co. (The)		302,781
	8,330	Kraft Foods, Inc. (Class A)		254,648
	900	Mead Johnson Nutrition Co.		52,173
	7,490	Ralcorp Holdings, Inc. (a)		458,388
	3,200	Sara Lee Corp.		54,304
	16,832	Smithfield Foods, Inc. (a)		335,125
				2,431,706
		Gas Utilities
	100	Questar Corp.		1,743
		Health Care Equipment & Supplies
	2,898	Baxter International, Inc.		140,524
	1,179	Beckman Coulter, Inc.		84,900
	1,081	Becton Dickinson and Co.		89,669
	21,974	Boston Scientific Corp. (a)		153,379
	196	C.R. Bard, Inc.		18,493
	2,610	Hologic, Inc. (a)		51,991
	196	Intuitive Surgical, Inc. (a)		63,290
	4,666	Medtronic, Inc.		178,801
	1,817	St Jude Medical, Inc. (a)		73,589
	1,474	Stryker Corp.		84,843
	799	Synthes, Inc.		105,396
	1,817	Zimmer Holdings, Inc. (a)		107,494
				1,152,369
		Health Care Providers & Services
	5,978	Aetna, Inc.		196,915
	2,947	AmerisourceBergen Corp.		105,679
	3,873	CIGNA Corp.		162,743
	16,298	Coventry Health Care, Inc. (a)		488,451
	2,063	Express Scripts, Inc. (a)		116,209
	10,384	Humana, Inc. (a)		601,961
	147	Laboratory Corp. of America Holdings (a)		13,217
	1,375	McKesson Corp.		103,359
	1,228	Medco Health Solutions, Inc. (a)		74,933
	18,018	Omnicare, Inc.		467,027
	491	Quest Diagnostics, Inc.		27,962
	16,081	UnitedHealth Group, Inc.		660,125
	6,249	Universal Health Services Inc		263,083
	5,725	WellPoint, Inc. (a)		355,637
				3,637,301
		Hotels, Restaurants & Leisure
	2,500	Las Vegas Sands Corp. (a)		116,225
	3,600	Marriott International, Inc. (Class A)		142,164
	10,397	McDonald’s Corp.		765,947
	3,400	Starbucks Corp.		107,202
	17,135	Yum! Brands, Inc.		801,233
				1,932,771
		Household Durables
	600	Stanley Black & Decker, Inc.		43,608
	16,154	Toll Brothers, Inc. (a)		326,957
				370,565
		Household Products
	200	Kimberly-Clark Corp.		12,946
	11,500	Procter & Gamble Co. (The)		725,995
				738,941
		Independent Power Producers & Energy Traders
	6,400	AES Corp. (The) (a)		79,360
	400	Calpine Corp. (a)		5,708

See Notes to Financial Statements

27

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
	8,719	Constellation Energy Group, Inc.	$	281,188
	17,031	NRG Energy, Inc. (a)		353,393
				719,649
		Industrial Conglomerates
	700	3M Co.		61,544
	52,989	General Electric Co.		1,067,198
				1,128,742
		Information Technology Services
	14,668	Automatic Data Processing, Inc.		702,597
	3,000	Cognizant Technology Solutions Corp. (Class A) (a)		218,850
	9,302	Computer Sciences Corp.		495,704
	1,100	Fidelity National Information Services, Inc.		33,473
	1,600	Fiserv, Inc. (a)		98,832
	900	Mastercard, Inc. (Class A)		212,859
	2,400	Paychex, Inc.		76,800
	3,000	Visa, Inc. (Class A)		209,550
	7,800	Western Union Co. (The)		158,184
				2,206,849
		Insurance
	19,400	Aflac, Inc.		1,117,052
	4,300	Allstate Corp. (The)		133,902
	1,700	AON Corp.		77,758
	8,049	Assurant, Inc.		315,762
	2,600	Berkshire Hathaway, Inc. (Class B) (a)		212,550
	17,848	Chubb Corp.		1,033,935
	22,863	Fidelity National Financial, Inc. (Class A)		307,507
	2,400	Genworth Financial, Inc. (Class A) (a)		32,568
	2,100	Hartford Financial Services Group, Inc.		58,338
	15,594	Lincoln National Corp.		449,731
	2,400	Loews Corp.		96,120
	3,100	Marsh & McLennan Cos., Inc.		86,428
	3,800	MetLife, Inc.		173,926
	14,934	Principal Financial Group, Inc.		489,387
	8,500	Progressive Corp. (The)		168,385
	17,700	Prudential Financial, Inc.		1,088,727
	5,179	Torchmark Corp.		322,652
	2,100	Travelers Cos., Inc. (The)		118,146
	12,024	Unum Group		299,879
	10,001	WR Berkley Corp.		282,528
				6,865,281
		Internet & Catalog Retail
	800	Amazon.com, Inc. (a)		135,712
	111,700	Expedia, Inc.		2,810,372
	100	NetFlix, Inc. (a)		21,408
	100	Priceline.com, Inc. (a)		42,852
				3,010,344
		Internet Software & Services
	2,100	Akamai Technologies, Inc. (a)		101,472
	9,600	eBay, Inc. (a)		291,456
	5,873	Google, Inc. (Class A) (a)		3,525,914
	9,800	Yahoo!, Inc. (a)		157,976
				4,076,818
		Leisure Equipment & Products
	1,000	Mattel, Inc.		23,680
		Machinery
	7,020	AGCO Corp. (a)		355,914
	13,020	Caterpillar, Inc.		1,263,070
	7,800	Danaher Corp.		359,268
	2,000	Deere & Co.		181,800
	200	Eaton Corp.		21,592
	15,580	Illinois Tool Works, Inc.		833,374
	2,700	PACCAR, Inc.		152,523
				3,167,541
		Media
	2,800	Cablevision Systems Corp.		94,780
	11,500	CBS Corp. (Class B)		228,045
	10,500	Comcast Corp. (Class A)		238,875
	9,600	Comcast Corp. (Special Class A)		205,824
	9,300	DirecTV (Class A) (a)		394,227
	1,400	Discovery Communications, Inc. (Class A) (a)		54,600

See Notes to Financial Statements

28

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
	1,500	Discovery Communications, Inc. Series C (a)	$	50,940
	4,900	Interpublic Group of Cos., Inc. (a)		52,381
	1,200	Liberty Global, Inc. Series A (a)		48,672
	1,100	Liberty Global, Inc. Series C (a)		42,097
	2,749	Liberty Media Corp. – Starz Series A (a)		183,276
	3,300	McGraw-Hill Cos., Inc. (The)		128,634
	4,600	News Corp. (Class B)		76,268
	28,200	News Corp. (Class A)		423,564
	3,300	Omnicom Group, Inc.		148,104
	900	Scripps Networks Interactive, Inc. (Class A)		41,850
	1,600	Time Warner Cable, Inc.		108,528
	28,115	Time Warner, Inc.		884,217
	4,400	Viacom, Inc. (Class B)		182,820
	3,300	Virgin Media, Inc.		83,028
	8,700	Walt Disney Co. (The)		338,169
				4,008,899
		Metals & Mining
	98,100	Alcoa, Inc.		1,625,517
	26,000	Cliffs Natural Resources, Inc.		2,221,960
	26,520	Commercial Metals Co.		443,415
	19,400	Freeport-McMoRan Copper & Gold, Inc.		2,109,750
	23,771	Steel Dynamics, Inc.		432,632
				6,833,274
		Multi-Utilities
	25,727	Centerpoint Energy, Inc.		415,491
	12,670	Integrys Energy Group, Inc.		602,965
	18,100	NiSource, Inc.		337,022
				1,355,478
		Multiline Retail
	300	Dollar General Corp. (a)		8,343
	300	Dollar Tree, Inc. (a)		15,174
	300	Family Dollar Stores, Inc.		12,744
	800	Kohl’s Corp. (a)		40,624
	600	Nordstrom, Inc.		24,708
	1,800	Target Corp.		98,694
				200,287
		Office Electronics
	39,686	Xerox Corp.		421,465
		Oil, Gas & Consumable Fuels
	1,948	Anadarko Petroleum Corp.		150,152
	3,716	Apache Corp.		443,542
	24,464	Chesapeake Energy Corp.		722,422
	33,014	Chevron Corp.		3,134,019
	208	Concho Resources, Inc. (a)		20,020
	35,413	ConocoPhillips		2,530,613
	1,070	Consol Energy, Inc.		53,179
	4,496	Devon Energy Corp.		398,750
	3,738	El Paso Corp.		59,359
	1,035	EOG Resources, Inc.		110,114
	100	EQT Corp.		4,819
	44,076	Exxon Mobil Corp.		3,556,052
	6,693	Hess Corp.		563,015
	9,125	Marathon Oil Corp.		417,012
	450	Murphy Oil Corp.		29,835
	610	Newfield Exploration Co. (a)		44,634
	32,456	Noble Energy, Inc.		2,956,742
	7,079	Occidental Petroleum Corp.		684,398
	40,887	Peabody Energy Corp.		2,593,053
	582	Pioneer Natural Resources Co.		55,383
	35	QEP Resources, Inc.		1,422
	200	Range Resources Corp.		9,974
	1,446	Southwestern Energy Co. (a)		57,117
	12,559	Spectra Energy Corp.		329,423
	7,325	Valero Energy Corp.		185,762
	8,078	Williams Cos., Inc. (The)		218,025
				19,328,836
		Paper & Forest Products
	25,648	MeadWestvaco Corp.		734,302
		Personal Products
	69,700	Avon Products, Inc.		1,973,207

See Notes to Financial Statements

29

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
		Pharmaceuticals
	57,322	Abbott Laboratories	$	2,588,662
	19,300	Allergan, Inc.		1,362,773
	56,130	Bristol-Myers Squibb Co.		1,413,353
	12,881	Eli Lilly & Co.		447,872
	5,893	Forest Laboratories, Inc. (a)		190,108
	1,081	Hospira, Inc. (a)		59,704
	15,070	Johnson & Johnson		900,734
	30,999	Merck & Co., Inc.		1,028,237
	95,204	Pfizer, Inc.		1,734,617
	43,600	Watson Pharmaceuticals, Inc. (a)		2,377,072
				12,103,132
		Real Estate Investment Trusts (REITs)
	1,800	AMB Property Corp.		60,390
	600	AvalonBay Communities, Inc.		69,558
	600	Boston Properties, Inc.		56,622
	1,100	Equity Residential		59,609
	4,300	Host Hotels & Resorts, Inc.		79,593
	26,269	Plum Creek Timber Co., Inc.		1,099,883
	1,500	Public Storage		163,470
	1,900	Simon Property Group, Inc.		192,755
				1,781,880
		Real Estate Management & Development
	2,900	CB Richard Ellis Group, Inc. (Class A) (a)		64,351
		Road & Rail
	41,800	CSX Corp.		2,951,080
	54,201	Norfolk Southern Corp.		3,316,559
				6,267,639
		Semiconductors & Semiconductor Equipment
	167,700	Applied Materials, Inc.		2,631,213
	73,800	Broadcom Corp. (Class A)		3,327,642
	141,235	Intel Corp.		3,030,903
	126,000	Nvidia Corp. (a)		3,013,920
	200	Texas Instruments, Inc.		6,782
				12,010,460
		Software
	4,000	Adobe Systems, Inc. (a)		132,200
	1,900	BMC Software, Inc. (a)		90,630
	4,200	CA, Inc.		99,960
	1,400	Citrix Systems, Inc. (a)		88,452
	3,000	Intuit, Inc. (a)		140,790
	69,567	Microsoft Corp.		1,928,745
	26,890	Oracle Corp.		861,287
	900	Salesforce.com, Inc. (a)		116,226
	6,700	Symantec Corp. (a)		117,987
				3,576,277
		Specialty Retail
	200	Abercrombie & Fitch Co. (Class A)		10,082
	200	Advance Auto Parts Inc.		12,788
	100	AutoZone, Inc. (a)		25,353
	700	Bed Bath & Beyond, Inc. (a)		33,600
	900	Best Buy Co., Inc.		30,600
	700	CarMax, Inc. (a)		22,855
	500	GameStop Corp. (Class A) (a)		10,535
	800	Gap, Inc. (The)		15,416
	22,851	Home Depot, Inc.		840,231
	800	Limited Brands, Inc.		23,392
	3,600	Lowe’s Cos., Inc.		89,280
	300	O’Reilly Automotive, Inc. (a)		17,049
	300	PetSmart, Inc.		12,072
	300	Ross Stores, Inc.		19,560
	1,900	Staples, Inc.		42,389
	400	Tiffany & Co.		23,252
	1,100	TJX Cos., Inc.		52,129
	300	Urban Outfitters, Inc. (a)		10,146
				1,290,729
		Textiles, Apparel & Luxury Goods
	2,700	Coach, Inc.		146,043
	3,500	NIKE, Inc. (Class B)		288,680
	8,664	VF Corp.		716,686
				1,151,409
		Tobacco
	8,580	Altria Group, Inc.		201,716
	700	Lorillard, Inc.		52,668

See Notes to Financial Statements

30

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES			VALUE
	47,654	Philip Morris International, Inc.	$	2,727,715
	1,800	Reynolds American, Inc.		57,258
				3,039,357
		Wireless Telecommunication Services
	3,900	American Tower Corp. (Class A) (a)		198,354
	3,600	Crown Castle International Corp. (a)		151,812
	23,700	Sprint Nextel Corp. (a)		107,124
				457,290
		Total United States		159,633,965
		Total Common Stocks (Cost $269,476,155)		310,658,651
		Preferred Stocks (0.8%)
		Brazil (0.7%)
		Beverages
	12,500	Cia de Bebidas das Americas		335,868
		Commercial Banks
	28,291	Banco Bradesco SA		522,729
	40,511	Investimentos Itau SA		286,526
	28,541	Itau Unibanco Holding SA		609,361
				1,418,616
		Diversified Telecommunication Services
	5,707	Tele Norte Leste Participacoes SA		91,000
		Electric Utilities
	11,628	Centrais Eletricas Brasileiras SA		187,993
	9,201	Cia Energetica de Minas Gerais		151,239
				339,232
		Metals & Mining
	4,591	Bradespar SA		125,919
	9,327	Gerdau SA		119,458
	4,467	Metalurgica Gerdau SA		68,307
	7,926	Usinas Siderurgicas de Minas Gerais SA		92,386
	29,313	Vale SA		896,649
				1,302,719
		Oil, Gas & Consumable Fuels
	43,330	Petroleo Brasileiro SA		704,166
	1,600	Ultrapar Participacoes SA		100,975
				805,141
		Wireless Telecommunication Services
	2,306	Vivo Participacoes SA		77,468
		Total Brazil		4,370,044
		Germany (0.1%)
		Automobiles
	3,157	Volkswagen AG		509,712
		Household Products
	2,292	Henkel AG & Co. KGaA		139,759
		Total Germany		649,471
		Total Preferred Stocks (Cost $4,746,271)		5,019,515
		Rights (0.0%)
		Brazil (0.0%)
		Electric Utilities
	305	Centrais Eletricas Brasileiras SA (a)		15
	1,956	Centrais Eletricas Brasileiras SA (a)		94
		Total Brazil		109
		Spain (0.0%)
		Commercial Banks
	86,111	Banco Santander SA (a)		16,270
		Total Rights (Cost $0)		16,379

See Notes to Financial Statements

31

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
		Corporate Bonds (8.3%)
		Australia (0.6%)
		Capital Markets
$	385	Macquarie Group Ltd. (144A) (e) 6.00% 01/14/20	$	385,380
		Commercial Banks
	EUR 400	Australia & New Zealand Banking Group Ltd. (MTN) 5.125% 09/10/19		545,267
$	500	Commonwealth Bank of Australia (144A) (e) 2.90% 09/17/14		520,807
	355	Commonwealth Bank of Australia (144A) (e) 5.00% 10/15/19		370,106
	65	Commonwealth Bank of Australia (144A) (e) 5.00% 03/19/20		67,284
	400	National Australia Bank Ltd. (144A) (e) 3.375% 07/08/14		422,781
	90	Westpac Banking Corp. 3.00% 12/09/15		90,159
	245	Westpac Banking Corp. 4.20% 02/27/15		259,254
				2,275,658
		Diversified Minerals
	405	Rio Tinto Finance USA Ltd. 9.00% 05/01/19		537,742
		Food – Retail
	195	Woolworths Ltd. (144A) (e) 4.00% 09/22/20		190,040
		Total Australia		3,388,820
		Bermuda (0.1%)
		Energy Equipment & Services
	350	Weatherford International Ltd. 5.125% 09/15/20		353,690
		Canada (0.3%)
		Aerospace & Defense
	65	Bombardier, Inc. (144A) (e) 7.50% 03/15/18		71,013
	135	Bombardier, Inc. (144A) (e) 7.75% 03/15/20		148,500
				219,513
		Commercial Banks
	615	Bank of Montreal (144A) (e) 2.85% 06/09/15		627,378
		Diversified Minerals
	220	Teck Resources Ltd. 10.25% 05/15/16		269,784
		Real Estate Management & Development
	380	Brookfield Asset Management, Inc. 5.80% 04/25/17		391,128
		Total Canada		1,507,803
		Cayman Islands (0.2%)
		Aerospace & Defense
	240	Systems 2001 Asset Trust (144A) (e) 6.664% 09/15/13		258,060
		Diversified Minerals
	185	Vale Overseas Ltd. 5.625% 09/15/19		196,715
	50	Vale Overseas Ltd. 6.875% 11/10/39		53,137
				249,852
		Oil Company – Integrated
	330	Petrobras International Finance Co. 5.75% 01/20/20		342,367
		Telecommunication Services
	330	Sable International Finance Ltd. (144A) (e) 7.75% 02/15/17		353,925
		Total Cayman Islands		1,204,204
		France (0.3%)
		Building Product – Cement/Aggregation
	EUR 200	Lafarge SA (MTN) 5.50% 12/16/19		265,706

See Notes to Financial Statements

32

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
		Diversified Financial Services
$	300	BNP Paribas (MTN) 5.431% 09/07/17	$	434,792
	350	Credit Agricole SA (MTN) 5.875% 06/11/19		506,658
				941,450
		Electronic Parts Distribution
	200	Rexel SA 8.25% 12/15/16		303,951
		Multimedia
	145	Vivendi SA (144A) (e) 6.625% 04/04/18		164,214
		Rental Auto/Equipment
	EUR 250	Europcar Groupe SA (REGS) 4.55%(f) 05/15/13		336,939
		Total France		2,012,260
		Germany (0.0%)
		Capital Markets
	100	Deutsche Bank AG (MTN) 5.00% 06/24/20		138,265
		Ireland (0.1%)
		Containers – Metal & Glass
	250	Ardagh Glass Finance PLC (REGS) 8.75% 02/01/20		357,690
		Paper & Related Products
	200	Smurfit Kappa Acquisitions (REGS) 7.75% 11/15/19		293,683
		Total Ireland		651,373
		Italy (0.3%)
		Commercial Banks
	400	Intesa Sanpaolo SpA (MTN) 3.375% 01/19/15		531,064
	300	UniCredit SpA (MTN) 5.75% 09/26/17		398,373
	500	UniCredit SpA (MTN) 4.375% 02/10/14		693,712
		Total Italy		1,623,149
		Luxembourg (0.5%)
		Aerospace/Defense
	250	Finmeccanica Finance SA (MTN) 8.125% 12/03/13		386,092
		Electric – Integrated
$	650	Enel Finance International SA (144A) (e) 5.125% 10/07/19		641,897
		Metals & Mining
	390	ArcelorMittal 9.85% 06/01/19		501,323
		Oil Company – Exploration & Production
	100	Gazprom Via Gaz Capital SA (144A) (e) 6.51% 03/07/22		102,500
		Telecommunication Services
	EUR 200	Wind Acquisition Finance SA (REGS) 11.75% 07/15/17		313,563
		Telephone – Integrated
$	255	Telecom Italia Capital SA 6.999% 06/04/18		272,796
	225	Telecom Italia Capital SA 7.175% 06/18/19		243,955
	EUR 400	Telecom Italia Finance SA (MTN) 7.75% 01/24/33		580,620
				1,097,371
		Total Luxembourg		3,042,746
		Netherlands (0.4%)
		Commercial Banks
$	600	ING Bank N.V. (144A) (e) 3.90% 03/19/14		642,990
		Construction Materials
	EUR 250	HeidelbergCement Finance BV 7.50% 04/03/20		359,402
		Containers – Metal & Glass
	200	OI European Group BV (REGS) 6.75% 09/15/20		280,676

See Notes to Financial Statements

33

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
		Multi-line Insurance
$	335	Aegon N.V. 4.625% 12/01/15	$	346,701
		Telephone – Integrated
	150	Deutsche Telekom International Finance BV 8.75% 06/15/30		198,101
	415	Telefonica Europe BV 8.25% 09/15/30		494,824
				692,925
		Total Netherlands		2,322,694
		Netherlands Antilles (0.1%)
		Medical – Drugs
	305	Teva Pharmaceutical Finance II BV/Teva Pharmaceutical Finance III LLC 3.00% 06/15/15		312,411
		Spain (0.1%)
		Gas – Distribution
	EUR 350	Gas Natural Capital Markets SA (MTN) 4.125% 01/26/18		433,357
		Telephone – Integrated
	200	Telefonica Emisiones SAU (MTN) 3.661% 09/18/17		256,602
		Total Spain		689,959
		Sweden (0.0%)
		Commercial Banks
$	260	Nordea Bank AB (144A) (e) 4.875% 01/27/20		264,732
		Switzerland (0.1%)
		Capital Markets
	195	UBS AG/Stamford CT (MTN) 5.875% 12/20/17		213,144
	250	UBS AG/Stamford CT (Series DPNT) 3.875% 01/15/15		257,735
				470,879
		Commercial Banks
	170	Credit Suisse 5.30% 08/13/19		178,165
	90	Credit Suisse 6.00% 02/15/18		95,668
	110	Credit Suisse AG 5.40% 01/14/20		111,541
				385,374
		Total Switzerland		856,253
		United Kingdom (1.1%)
		Advertising Services
	100	WPP Finance 8.00% 09/15/14		116,488
		Building Societies
	525	Nationwide Building Society (144A) (e) 6.25% 02/25/20		530,212
		Commercial Banks
	440	Barclays Bank PLC 6.75% 05/22/19		494,295
	EUR 250	Barclays Bank PLC (MTN) 6.00% 01/14/21		336,636
$	385	HBOS PLC (144A) (e) 6.75% 05/21/18		355,616
	EUR 200	HSBC Holdings PLC (MTN) 6.00% 06/10/19		293,996
$	450	Royal Bank of Scotland PLC (The) 4.875% 03/16/15		458,291
	190	Royal Bank of Scotland PLC (The) 5.625% 08/24/20		183,727
	160	Standard Chartered PLC (144A) (e) 3.85% 04/27/15		164,849
				2,287,410
		Containers – Metal & Glass
	EUR 150	Rexam PLC 6.75%(f) 06/29/67		201,008
		Diversified Minerals
$	390	Anglo American Capital PLC (144A) (e) 9.375% 04/08/19		525,728
		Finance – Auto Loans
	EUR 200	FCE Bank PLC Series E 7.125% 01/15/13		289,247

See Notes to Financial Statements

34

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
		Money Center Banks
$	150	Lloyds TSB Bank PLC (144A) (e) 5.80% 01/13/20	$	145,871
	EUR 300	Lloyds TSB Bank PLC (MTN) 6.375% 06/17/16		435,406
	250	Lloyds TSB Bank PLC (MTN) 6.50% 03/24/20		319,885
				901,162
		Mortgage Banks
$	265	Abbey National Treasury Services PLC (144A) (e) 3.875% 11/10/14		262,377
	EUR 650	Abbey National Treasury Services PLC (MTN) 3.625% 10/14/16		860,261
				1,122,638
		Paper & Related Products
	200	Mondi Finance PLC 5.75% 04/03/17		282,570
		Tobacco
$	155	BAT International Finance PLC (144A) (e) 9.50% 11/15/18		205,939
		Total United Kingdom		6,462,402
		United States (4.1%)
		Advertising Agencies
	245	Omnicom Group, Inc. 4.45% 08/15/20		240,979
		Agricultural Operations
	115	Bunge Ltd. Finance Corp. 8.50% 06/15/19		135,950
		Auto – Cars/Light Trucks
	190	Daimler Finance North America LLC 7.30% 01/15/12		201,048
	45	Daimler Finance North America LLC 8.50% 01/18/31		58,901
	110	Nissan Motor Acceptance Corp. (144A) (e) 4.50% 01/30/15		115,108
				375,057
		Beverages
	85	Anheuser-Busch InBev Worldwide, Inc. 5.00% 04/15/20		89,443
	45	Anheuser-Busch InBev Worldwide, Inc. (144A) (e) 5.375% 11/15/14		49,962
	185	Anheuser-Busch InBev Worldwide, Inc. (144A) (e) 7.20% 01/15/14		213,424
				352,829
		Beverages – Wine/Spirits
	75	Constellation Brands, Inc. 7.25% 09/01/16		80,156
		Building Product – Cement/Aggregation
	240	CRH America, Inc. 6.00% 09/30/16		258,069
		Cable/Satellite TV
	160	DirecTV Holdings LLC/DirecTV Financing Co., Inc. 4.60% 02/15/21		157,285
	95	DirecTV Holdings LLC/DirecTV Financing Co., Inc. 5.875% 10/01/19		103,460
	90	DirecTV Holdings LLC/DirecTV Financing Co., Inc. 7.625% 05/15/16		100,010
	230	DISH DBS Corp. 7.125% 02/01/16		241,500
				602,255
		Capital Markets
	775	Goldman Sachs Group, Inc. (The) 6.15% 04/01/18		845,440
	255	Goldman Sachs Group, Inc. (The) 6.75% 10/01/37		256,702
				1,102,142
		Commercial Banks
	330	PNC Funding Corp. 5.125% 02/08/20		346,259

See Notes to Financial Statements

35

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
$	190	PNC Funding Corp. 6.70% 06/10/19	$	220,185
				566,444
		Diversified Financial Services
	350	Bank of America Corp. (Series L) 5.65% 05/01/18		365,091
	720	Citigroup, Inc. (See Note 6) 8.50% 05/22/19		882,690
	245	Citigroup, Inc. (See Note 6) 6.125% 05/15/18		266,721
	465	General Electric Capital Corp. 5.625% 05/01/18		504,829
	890	General Electric Capital Corp. (Series G) 6.00% 08/07/19		989,933
	75	JPMorgan Chase & Co. 6.00% 01/15/18		83,424
				3,092,688
		Diversified Operation/Commercial Service
	330	ARAMARK Corp. 8.50% 02/01/15		345,675
		Diversified Telecommunication Services
	50	AT&T, Inc. 6.15% 09/15/34		50,557
	210	AT&T, Inc. 6.30% 01/15/38		217,212
	70	AT&T, Inc. 6.55% 02/15/39		74,794
	65	CenturyLink, Inc. (Series Q) 6.15% 09/15/19		67,390
	60	Verizon Communications, Inc. 5.85% 09/15/35		60,386
	205	Verizon Communications, Inc. 6.35% 04/01/19		236,629
	225	Verizon Communications, Inc. 8.95% 03/01/39		313,385
				1,020,353
		Electronic Equipment, Instruments & Components
	155	Agilent Technologies, Inc. 5.50% 09/14/15		168,889
	95	Corning, Inc. 6.625% 05/15/19		109,568
				278,457
		Electronic Parts Distribution
	295	Arrow Electronics, Inc. 5.125% 03/01/21		285,308
		Electronics – Military
	310	L-3 Communications Corp. 4.75% 07/15/20		307,549
		Finance – Consumer Loans
	180	SLM Corp. (MTN) 6.25% 01/25/16		180,529
	245	SLM Corp. (Series A) 5.00% 10/01/13		252,112
				432,641
		Finance – Credit Card
	345	American Express Credit Corp. (Series C) 7.30% 08/20/13		390,028
	455	Capital One Bank USA NA 8.80% 07/15/19		565,652
				955,680
		Finance – Investment Banker/Broker
	180	Bear Stearns Cos. LLC (The) 6.40% 10/02/17		204,856
	305	Bear Stearns Cos. LLC (The) 7.25% 02/01/18		360,531
	250	Jefferies Group, Inc. 3.875% 11/09/15		250,445
	680	Merrill Lynch & Co., Inc. (MTN) 6.875% 04/25/18		754,790
	335	TD Ameritrade Holding Corp. 5.60% 12/01/19		352,845
				1,923,467
		Finance – Other Services
	255	NASDAQ OMX Group, Inc. (The) 5.55% 01/15/20		258,001
		Food – Miscellaneous/Diversified
	135	ConAgra Foods, Inc. 8.25% 09/15/30		164,655

See Notes to Financial Statements

36

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
		Health Care Equipment & Supplies
$	395	Boston Scientific Corp. 6.00% 01/15/20	$	410,071
		Health Care Providers & Services
	380	Medco Health Solutions, Inc. 7.125% 03/15/18		447,045
		Independent Power Producer
	135	NRG Energy, Inc. 8.50% 06/15/19		141,412
		Insurance
	150	Principal Financial Group, Inc. 8.875% 05/15/19		190,707
	265	Prudential Financial, Inc. (MTN) 4.75% 09/17/15		283,420
	150	Prudential Financial, Inc. (MTN) 6.625% 12/01/37		165,082
	45	Prudential Financial, Inc. (Series D) 7.375% 06/15/19		53,438
				692,647
		Life/Health Insurance
	200	Pacific LifeCorp (144A) (e) 6.00% 02/10/20		209,624
		Media
	205	CBS Corp. 8.875% 05/15/19		258,233
	105	Comcast Corp. 5.70% 05/15/18		115,444
	50	Comcast Corp. 6.45% 03/15/37		52,200
	105	Time Warner Cable, Inc. 6.75% 06/15/39		112,951
	250	Viacom, Inc. 6.875% 04/30/36		281,049
				819,877
		Medical – Biomedical/Genetics
	304	Celgene Corp. 3.95% 10/15/20		289,231
	220	Genzyme Corp. 3.625% 06/15/15		227,819
				517,050
		Medical – Drugs
	455	Merck & Co., Inc. 3.875% 01/15/21		449,857
		Medical – Hospitals
	140	HCA, Inc. 8.50% 04/15/19		156,800
		Medical Labs & Testing Services
	245	Laboratory Corp. of America Holdings 4.625% 11/15/20		244,986
		Metals & Mining
	80	Freeport-McMoRan Copper & Gold, Inc. 8.375% 04/01/17		89,309
		Multi-line Insurance
	160	American International Group, Inc. 6.40% 12/15/20		171,028
	235	Farmers Exchange Capital (144A) (e) 7.05% 07/15/28		227,889
				398,917
		Multiline Retail
	90	JC Penney Co., Inc. 5.65% 06/01/20		87,300
	151	JC Penney Corp., Inc. 6.375% 10/15/36		139,297
				226,597
		Multimedia
	225	NBC Universal, Inc. (144A) (e) 4.375% 04/01/21		218,161
	310	News America, Inc. 7.85% 03/01/39		379,783
				597,944
		Office Electronics
	55	Xerox Corp. 5.625% 12/15/19		59,417
	145	Xerox Corp. 6.35% 05/15/18		164,328
				223,745
		Oil Company – Integrated
	210	Marathon Petroleum Corp. (144A) (e) 5.125% 03/01/21		212,294

See Notes to Financial Statements

37

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
		Paper & Related Products
$	455	Georgia-Pacific LLC (144A) (e) 5.40% 11/01/20	$	450,043
	60	Georgia-Pacific LLC (144A) (e) 8.25% 05/01/16		67,800
				517,843
		Pipelines
	125	Kinder Morgan Energy Partners LP 5.95% 02/15/18		138,597
	190	Plains All American Pipeline LP/PAA Finance Corp. 6.70% 05/15/36		197,680
	190	Plains All American Pipeline LP/PAA Finance Corp. 8.75% 05/01/19		238,881
				575,158
		Property Trust
	225	WEA Finance LLC/WT Finance Aust Pty Ltd. (144A) (e) 6.75% 09/02/19		253,611
		Real Estate Investment Trusts (REITs)
	75	Boston Properties LP 5.875% 10/15/19		82,151
		Reinsurance
	200	Reinsurance Group of America, Inc. 6.45% 11/15/19		213,124
		REIT – Diversified
	250	Duke Realty LP 6.75% 03/15/20		276,864
	55	Vornado Realty LP 4.25% 04/01/15		56,311
				333,175
		REIT – Health Care
	240	Health Care, Inc. 6.125% 04/15/20		255,953
		Retail – Drug Store
	422	CVS Pass-Through Trust 6.036% 12/10/28		431,395
		Retail – Mail Order
	265	QVC, Inc. (144A) (e) 7.125% 04/15/17		279,575
		Semiconductor Equipment
	145	KLA-Tencor Corp. 6.90% 05/01/18		160,391
		Special Purpose Entity
	450	AIG SunAmerica Global Financing VI (144A) (e) 6.30% 05/10/11		458,437
	135	Harley-Davidson Funding Corp. (144A) (e) 6.80% 06/15/18		145,713
				604,150
		Specialty Retail
	175	Home Depot, Inc. 5.40% 09/15/40		166,441
	400	Home Depot, Inc. 5.875% 12/16/36		405,306
				571,747
		Telecommunication Services
	155	Qwest Corp. 6.50% 06/01/17		171,662
	125	Qwest Corp. 6.875% 09/15/33		124,375
	145	SBA Telecommunications, Inc. 8.25% 08/15/19		160,588
				456,625
		Telephone – Integrated
	380	Frontier Communications Corp. 8.50% 04/15/20		430,350
		Tobacco
	85	Altria Group, Inc. 4.125% 09/11/15		89,061
	185	Altria Group, Inc. 9.25% 08/06/19		237,684

See Notes to Financial Statements

38

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
$	235	Philip Morris International, Inc. 5.65% 05/16/18	$	266,251
				592,996
		Total United States		24,374,774
		Total Corporate Bonds (Cost $46,659,895)		49,205,535
		Foreign Government Obligations (11.8%)
		Australia (0.3%)
	AUD 2,000	Queensland Treasury Corp. (Series 15G) 6.00% 10/14/15		2,034,515
		Bermuda (0.0%)
$	240	Bermuda Government International Bond (144A) (e) 5.603% 07/20/20		251,562
		Canada (0.8%)
	EUR 300	Canada Government International Bond 3.50% 01/13/20		423,605
	CAD 2,800	Canadian Government Bond 4.25% 06/01/18		3,021,405
$	600	Province of Ontario Canada 4.00% 10/07/19		612,114
	EUR 600	Province of Ontario Canada Series E 4.00% 12/03/19		845,337
		Total Canada		4,902,461
		Croatia (0.1%)
$	300	Croatia Government International Bond (REGS) 6.75% 11/05/19		313,116
		Denmark (0.1%)
	DKK 3,300	Denmark Government Bond 4.00% 11/15/17		649,608
		France (0.7%)
	EUR 1,000	France Government Bond OAT 3.75% 04/25/17		1,430,335
	1,900	French Treasury Note BTAN 4.50% 07/12/12		2,718,953
		Total France		4,149,288
		Germany (1.2%)
	2,100	Bundesrepublik Deutschland (Series 03) 4.75% 07/04/34		3,360,575
	2,500	Bundesrepublik Deutschland (Series 08) 4.25% 07/04/18		3,730,952
		Total Germany		7,091,527
		Hungary (0.1%)
	600	Republic of Hungary 5.75% 06/11/18		795,942
		Indonesia (0.1%)
$	250	Indonesia Government International Bond (REGS) 11.625% 03/04/19		363,750
		Italy (1.8%)
	EUR 2,400	Italy Buoni Poliennali del Tesoro 2.50% 07/01/12		3,300,435
	1,100	Italy Buoni Poliennali del Tesoro 3.50% 06/01/14		1,513,933
	2,300	Italy Buoni Poliennali Del Tesoro 4.00% 02/01/17		3,155,133
	1,100	Italy Buoni Poliennali Del Tesoro 4.50% 02/01/18		1,532,559
	800	Italy Buoni Poliennali Del Tesoro 5.00% 08/01/39		1,037,274
$	330	Republic of Italy 6.875% 09/27/23		366,314
		Total Italy		10,905,648
		Japan (3.0%)
	JPY 110,000	Japan Finance Organization for Municipalities 1.90% 06/22/18		1,438,772
	140,000	Japan Government Ten Year Bond (Series 257) 1.30% 12/20/13		1,755,866
	240,000	Japan Government Ten Year Bond (Series 267) 1.30% 12/20/14		3,022,804

See Notes to Financial Statements

39

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
	JPY 180,000	Japan Government Ten Year Bond (Series 272) 1.40% 09/20/15	$	2,284,998
	120,000	Japan Government Ten Year Bond (Series 280) 1.90% 06/20/16		1,566,105
	290,000	Japan Government Ten Year Bond (Series 294) 1.70% 06/20/18		3,754,366
	345,000	Japan Government Thirty Year Bond (Series 11) 1.70% 06/20/33		3,946,631
		Total Japan		17,769,542
		Luxembourg (0.3%)
	145,000	European Investment Bank 2.15% 01/18/27		1,867,166
		Mexico (0.4%)
	MXN 24,400	Mexican Bonos (Series M 20) 10.00% 12/05/24		2,430,547
		Netherlands (0.4%)
	EUR 1,600	Netherlands Government Bond 3.75% 07/15/14		2,317,415
		Norway (0.1%)
	NOK 3,500	Norway Government Bond (Series 470) 6.50% 05/15/13		657,073
		Peru (0.1%)
$	390	Peruvian Government International Bond 7.125% 03/30/19		467,805
		Poland (0.5%)
	PLN 5,100	Poland Government Bond (Series 0413) 5.25% 04/25/13		1,785,644
	3,400	Poland Government Bond (Series 1015) 6.25% 10/24/15		1,209,125
		Total Poland		2,994,769
		South Africa (0.3%)
	ZAR 12,500	South Africa Government Bond (Series R207) 7.25% 01/15/20		1,590,401
		South Korea (0.1%)
$	100	Export-Import Bank of Korea 4.125% 09/09/15		101,885
	200	Korea Development Bank 4.375% 08/10/15		206,158
	150	Republic of Korea 7.125% 04/16/19		179,821
		Total South Korea		487,864
		Sweden (0.2%)
	SEK 8,300	Sweden Government Bond (Series 1049) 4.50% 08/12/15		1,368,107
		United Kingdom (1.2%)
	GBP 500	United Kingdom Gilt 2.75% 01/22/15		815,656
	600	United Kingdom Gilt 4.00% 09/07/16		1,021,904
	2,450	United Kingdom Gilt 4.25% 06/07/32		3,837,558
	750	United Kingdom Gilt 4.50% 03/07/13		1,280,914
		Total United Kingdom		6,956,032
		Total Foreign Government Obligations (Cost $67,051,464)		70,364,138
		Municipal Bonds (0.1%)
		Georgia (0.1%)
$	295	Municipal Electric Authority of Georgia Plant Vogtle 6.655% 04/01/57		284,589
	160	Municipal Electric Authority of Georgia Plant Vogtle Units 3 & 4 (Series 2010 J) 6.637% 04/01/57		155,402
		Total Georgia		439,991

See Notes to Financial Statements

40

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

PRINCIPAL
AMOUNT IN
THOUSANDS			VALUE
		Illinois (0.0%)
$	145	Illinois State Toll Highway Authority 2009 (Series A) 6.184% 01/01/34	$	138,243
		Total Municipal Bonds (Cost $603,713)		578,234
		U.S. Government Agencies – Mortgage-Backed Securities (2.8%)
		Federal Home Loan Mortgage Corporation (PC) Gold
	209	6.00% 08/01/38		227,192
	340	6.50% 05/01/32-09/01/32		383,744
				610,936
		Federal National Mortgage Association
	1,400	4.50% (g)		1,431,719
	1,679	5.00% 09/01/40		1,762,542
	1,150	5.00% (g)		1,202,648
	1,786	5.50% 06/01/38		1,910,430
	1,936	6.00% 12/01/36 - 10/01/38		2,110,473
	94	6.50% 12/01/29		105,912
	887	7.00% 12/01/17 - 02/01/31		1,011,015
				9,534,739
		Government National Mortgage Association
	2,765	4.00% (g)		2,765,000
	3,062	4.50% 04/15/39 - 08/15/39		3,172,881
	434	5.50% 08/15/39		469,447
				6,407,328
		Total U.S. Government Agencies – Mortgage-Backed Securities (Cost $16,498,543)		16,553,003
		Asset-Backed Securities (0.2%)
	149	ARI Fleet Lease Trust 2010-A A (144A) (e) 1.711(f)% 08/15/18		150,189
	178	Chesapeake Funding LLC 2009-1 A (144A) (e) 2.261% (f) 12/15/20		179,642
	525	Ford Credit Floorplan Master Owner Trust 2010-3 A2 (144A) (e) 1.961% (f) 02/15/17		545,207
	325	GE Dealer Floorplan Master Note Trust 2009-2A A (144A) (e) 1.811% (f) 10/20/14		329,934
		Total Asset-Backed Securities (Cost $1,178,478)		1,204,972
		U.S. Government Agencies & Obligations (3.7%)
		Diversified Financial Services – FDIC Guaranteed (0.2%)
	1,300	Citigroup Funding, Inc. (See Note 6) 2.25% 12/10/12		1,338,380
		U.S. Government Obligations (3.5%)
		U.S. Treasury Bonds
	220	3.50% 02/15/39		182,806
	790	4.375% 11/15/39		766,300
	2,900	6.875% 08/15/25		3,823,923
	3,430	7.50% 11/15/24		4,749,480
		U.S. Treasury Notes
	1,500	2.375% 10/31/14		1,557,774
	7,105	2.625% 08/15/20		6,700,349
	2,600	3.375% 11/15/19		2,650,172
				20,430,804
		Total U.S. Government Agencies & Obligations (Cost $21,406,234)		21,769,184
		Commodity-Linked Securities (3.5%)
		Germany
	19,524	Deutsche Bank AG London (Series 0005) (144A) (Cost $19,898,299) (e)(h) 0.00% 11/25/11		20,826,251

See Notes to Financial Statements

41

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

NUMBER OF
SHARES (000)						VALUE
		Investment Trust (1.1%)
	391,700	Financial Select Sector SPDR Fund (ETF) (Cost $6,097,241)				$	6,423,880
		Investment Company (0.2%)
	47,445	Morgan Stanley Institutional Fund, Inc. – Emerging Markets Portfolio (Class I) (See Note 6) (Cost $1,300,000)					1,228,832
PRINCIPAL
AMOUNT IN
THOUSANDS
		Short-Term Investments (15.7%)
		U.S. Government Obligation (0.4%)
$	2,420	U.S. Treasury Bill (Cost $2,419,078) (i)(j) 0.162% 04/28/11					2,419,121
NUMBER OF
SHARES (000)
		Investment Company (15.3%)
	90,952	Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class (See Note 6) (Cost $90,952,388)				$	90,952,388
		Total Short-Term Investments (Cost $93,371,466)					93,371,509
		Total Investments (Cost $548,287,759) (k)(l)(m)	100.5		%		597,220,083
		Liabilities in Excess of Other Assets	(0.5	)			(2,710,628	)
		Net Assets	100.0		%	$	594,509,455

ADR	American Depositary Receipt.
ETF	Exchange Traded Fund.
FDIC	Federal Deposit Insurance Corporation.
FDR	Fiduciary Depositary Receipt.
GDR	Global Depositary Receipt.
MTN	Medium Term Note.
PC	Participation Certificate.
PPS	Price Protected Share.
OAT	Obligations Assimilables du Trésor (French Treasury Obligation).
REIT	Real Estate Investment Trust.
SDR	Swedish Depositary Receipt.
(a)	Non-income producing security.
(b)	Comprised of securities in separate entities that are traded as a single stapled security.
(c)	Consists of one or more class of securities traded together as a unit; stocks with attached warrants.
(d)	Security trades on the Hong Kong exchange.
(e)	Resale is restricted to qualified institutional investors.
(f)	Floating rate security. Rate shown is the rate in effect at January 31, 2011.
(g)	Security was purchased on a forward commitment basis with an approximate principal amount and no definite maturity date; the actual principal amount and maturity date will be determined upon settlement.
(h)	Security is linked to the Dow Jones UBS Commodities Index Total Return. The index is currently comprised of futures contracts on nineteen physical commodities traded on U.S. exchanges, with the exception of aluminum, nickel and zinc, which trade on the London Metal Exchange.
(i)	Purchased on a discount basis. The interest rates shown have been adjusted to reflect a money market equivalent yield.
(j)	A portion of this security has been physically segregated in connection with open futures and swap contracts.
(k)	Securities have been designated as collateral in connection with securities purchased on a forward commitment basis, open foreign currency exchange, futures and swap contracts.
(l)	The market value and percentage of net assets, $123,983,213 and 20.9%, respectively, represent the securities that have been fair valued under the fair valuation policy for international investments as described in Note 1A within the Notes to Financial Statements.
(m)	The aggregate cost for federal income tax purposes approximates the aggregate cost for book purposes. The aggregate gross unrealized appreciation is $53,742,602 and the aggregate gross unrealized depreciation is $4,810,278 resulting in net unrealized appreciation of $48,932,324.

See Notes to Financial Statements

42

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

Foreign Currency Exchange Contracts Open at January 31, 2011:

						UNREALIZED
	CONTRACTS		IN EXCHANGE		DELIVERY	APPRECIATION
COUNTERPARTY	TO DELIVER		FOR		DATE	(DEPRECIATION)
Banc of America Securities LLC.	CAD	8,595,211	$	8,659,028	02/17/2011	$	78,207
Deutsche Securities, Inc.	EUR	459,974	$	627,796	02/17/2011		(1,833)
Deutsche Securities, Inc.	$	4,836,211	EUR	3,620,054	02/17/2011		119,045
Morgan (J.P.) Securities, Inc.	SEK	7,025,284	$	1,053,535	02/17/2011		(35,042)
Morgan (J.P.) Securities, Inc.	$	96,174	NOK	562,040	02/17/2011		1,064
Royal Bank of Scotland	$	1,229,685	ILS	4,349,046	02/17/2011		(57,434)
Royal Bank of Scotland	$	1,236,783	THB	37,730,530	02/17/2011		(15,523)
State Street Bank & Trust Company	$	5,659,687	TWD	163,446,092	02/17/2011		(28,663)
UBS Securities Japan Ltd.	AUD	3,449,539	$	3,427,186	02/17/2011		(3,610)
UBS Securities Japan Ltd.	BRL	1,794,028	$	1,058,736	02/17/2011		(13,433)
UBS Securities Japan Ltd.	CHF	2,381,103	$	2,475,854	02/17/2011		(46,932)
UBS Securities Japan Ltd.	GBP	499,339	$	789,483	02/17/2011		(10,286)
UBS Securities Japan Ltd.	GBP	2,235,449	$	3,563,516	02/17/2011		(16,906)
UBS Securities Japan Ltd.	JPY	31,961,416	$	388,166	02/17/2011		(1,263)
UBS Securities Japan Ltd.	KRW	1,743,155,573	$	1,547,752	02/17/2011		(5,185)
UBS Securities Japan Ltd.	PLN	4,156,112	$	1,430,730	02/17/2011		(14,950)
UBS Securities Japan Ltd.	PLN	4,188,230	$	1,437,895	02/17/2011		(18,956)
UBS Securities Japan Ltd.	SGD	1,957,120	$	1,522,143	02/17/2011		(7,714)
UBS Securities Japan Ltd.	$	12,135,560	CAD	12,046,364	02/17/2011		(109,364)
UBS Securities Japan Ltd.	$	7,717,902	EUR	5,777,392	02/17/2011		190,394
UBS Securities Japan Ltd.	$	5,078,934	GBP	3,177,656	02/17/2011		10,581
UBS Securities Japan Ltd.	$	9,293,284	HKD	72,255,082	02/17/2011		(23,948)
UBS Securities Japan Ltd.	$	3,860,503	INR	176,390,255	02/17/2011		(30,223)
UBS Securities Japan Ltd.	$	4,064,236	JPY	336,014,744	02/17/2011		29,884
UBS Securities Japan Ltd.	$	484,399	KRW	540,637,788	02/17/2011		(2,758)
UBS Securities Japan Ltd.	$	1,473,600	KRW	1,637,169,779	02/17/2011		(15,084)
UBS Securities Japan Ltd.	$	164,433	MXN	1,982,818	02/17/2011		(1,210)
UBS Securities Japan Ltd.	$	570,018	PLN	1,651,668	02/17/2011		4,505
UBS Securities Japan Ltd.	$	1,469,791	PLN	4,174,515	02/17/2011		(17,710)
UBS Securities Japan Ltd.	$	2,492,740	RUB	75,254,821	02/17/2011		29,662
UBS Securities Japan Ltd.	$	1,751,687	RUB	51,882,329	02/17/2011		(12,687)
UBS Securities Japan Ltd.	$	2,430,539	SGD	3,118,646	02/17/2011		7,270
UBS Securities Japan Ltd.	$	1,507,543	SGD	1,927,454	02/17/2011		(875)
UBS Securities Japan Ltd.	$	1,939,658	ZAR	13,469,083	02/17/2011		(70,994)
UBS Securities Japan Ltd.	$	1,405,763	ZAR	9,933,119	02/17/2011		(27,668)
Banc of America Securities LLC.	AUD	280,000	$	272,440	03/16/2011		(5,095)
Banc of America Securities LLC.	CAD	520,000	$	516,873	03/16/2011		(1,969)
Banc of America Securities LLC.	EUR	260,000	$	345,566	03/16/2011		(10,218)

See Notes to Financial Statements

43

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

						UNREALIZED
	CONTRACTS		IN EXCHANGE		DELIVERY	APPRECIATION
COUNTERPARTY	TO DELIVER		FOR		DATE	(DEPRECIATION)
Banc of America Securities LLC.	EUR	2,575,665	$	3,353,490	03/16/2011	$	(171,049)
Banc of America Securities LLC.	PLN	2,600,000	$	845,941	03/16/2011		(56,364)
Banc of America Securities LLC.	SGD	450,000	$	344,564	03/16/2011		(7,209)
Banc of America Securities LLC.	$	1,265,535	CAD	1,280,000	03/16/2011		11,614
Banc of America Securities LLC.	$	649,257	EUR	494,040	03/16/2011		26,787
Banc of America Securities LLC.	$	6,413,710	EUR	4,848,000	03/16/2011		220,292
Banc of America Securities LLC.	$	872,960	EUR	640,000	03/16/2011		2,816
Banc of America Securities LLC.	$	1,359,639	SEK	9,400,000	03/16/2011		95,269
Banc of America Securities LLC.	$	534,135	SGD	700,000	03/16/2011		13,066
UBS Securities Japan Ltd.	$	1,195,077	CHF	1,175,000	03/16/2011		50,162
UBS Securities Japan Ltd.	$	3,538,528	GBP	2,240,000	03/16/2011		48,430
UBS Securities Japan Ltd.	$	13,265,513	JPY	1,111,000,000	03/16/2011		274,190
UBS Securities Japan Ltd.	$	157,473	KRW	180,000,000	03/16/2011		2,598
UBS Securities Japan Ltd.	$	2,322,733	KRW	2,655,000,000	03/16/2011		38,323
UBS Securities Japan Ltd.	$	2,045,137	MYR	6,434,000	03/16/2011		50,449
UBS Securities Japan Ltd.	$	836,531	TWD	24,960,000	03/16/2011		23,878
UBS Securities Japan Ltd.	ZAR	4,900,000	$	705,472	03/16/2011		28,477
UBS Securities Japan Ltd.	ZAR	3,580,000	$	516,893	03/16/2011		22,272
Banc of America Securities LLC.	GBP	514,000	$	811,092	06/16/2011		(11,179)
	Net Unrealized Appreciation					$	525,901

Currency Abbreviations:
AUD	Australian Dollar.
BRL	Brazilian Real.
CAD	Canadian Dollar.
CHF	Swiss Franc.
DKK	Danish Krone.
EUR	Euro.
GBP	British Pound.
HKD	Hong Kong Dollar.
ILS	Israeli Shekel.
INR	Indian Rupee.
JPY	Japanese Yen.
KRW	South Korean Won.
MXN	Mexican New Peso.
MYR	Malaysian Ringgit.
NOK	Norwegian Krone.
PLN	Polish Zloty.
RUB	Russian Ruble.
SEK	Swedish Krona.
SGD	Singapore Dollar.
THB	Thai Baht.
TWD	Taiwan Dollar.
ZAR	South African Rand.

See Notes to Financial Statements

44

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

Futures Contracts Open at January 31, 2011:

						UNREALIZED
NUMBER OF			DESCRIPTION, DELIVERY	UNDERLYING FACE		APPRECIATION
CONTRACTS		LONG/SHORT	MONTH AND YEAR	AMOUNT AT VALUE		(DEPRECIATION)
	168	Long	U.S. Treasury Notes 5 Year, March 2011	$	19,893,562	$	(14,755	)
	112	Long	H-SHARES Index, February 2011		8,999,044		(100,457	)
	60	Long	U.S. Treasury Notes 10 Year, March 2011		7,247,813		(34,951	)
	59	Long	KOSPI2 Index, March 2011		7,212,543		453,050
	42	Long	Euro-Bobl, March 2011		6,717,654		(132,925	)
	40	Long	Hang Seng Index, February 2011		5,995,139		(111,245	)
	64	Long	FTSE 100 Index, March 2011		5,979,881		(8,599	)
	146	Long	Dow Jones Euro Stoxx 50 Index, March 2011		5,916,920		136,929
	53	Long	TOPIX Index, March 2011		5,869,517		190,840
	75	Long	U.S. Dollar Index, March 2011		5,839,875		(180,071	)
	104	Long	CAC40 10 Euro, February 2011		5,704,209		65,203
	170	Long	MSCI Taiwan Index, February 2011		5,545,400		57,247
	3	Long	JPN 10 Year Bond, March 2011		5,117,690		(4,236	)
	78	Long	FTSE/JSE top 40, March 2011		3,060,657		(897	)
	48	Long	MSCI Singapore Index, February 2011		2,821,543		604
	81	Long	MEX BOLSA Index, March 2011		2,478,609		(55,886	)
	8	Long	DAX Index, March 2011		1,943,098		24,814
	13	Long	IBEX 35 Index, February 2011		1,920,863		29,190
	168	Long	SGX CNX NIFTY Index, February 2011		1,856,232		(78,449	)

See Notes to Financial Statements

45

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

							UNREALIZED
NUMBER OF			DESCRIPTION, DELIVERY	UNDERLYING FACE			APPRECIATION
CONTRACTS		LONG/SHORT	MONTH AND YEAR	AMOUNT AT VALUE			(DEPRECIATION)
	10	Long	S&P/TSX 60 Index, March 2011	$	1,553,303		$	54,905
	1	Long	SPI 200, March 2011		117,743			(1,153	)
	21	Short	S&P/MID Index, March 2011		(3,173,519	)		(180,876	)
	81	Short	E-Mini MSCI Index, March 2011		(4,510,485	)		29,842
	31	Short	S&P/TSX 60 Index, March 2011		(4,815,239	)		(122,735	)
	31	Short	Euro-Bund, March 2011		(5,251,978	)		103,241
	70	Short	U.S. Treasury Bonds 20 Year, March 2011		(8,443,750	)		423,962
	179	Short	S&P 500 E-Mini, March 2011		(11,477,480	)		(164,430	)
	59	Short	U.S. Treasury Notes 2 Year, March 2011		(12,932,063	)		(31,468	)
	138	Short	U.S. Treasury Notes 10 Year, March 2011		(16,669,969	)		236,162
			Net Unrealized Appreciation				$	582,856

Interest Rate Swap Contracts Open at January 31, 2011:

	NOTIONAL									UNREALIZED
	AMOUNT		FLOATING RATE	PAY/RECEIVE					TERMINATION	APPRECIATION
SWAP COUNTERPARTY	(000)		INDEX	FLOATING RATE	FIXED RATE				DATE	(DEPRECIATION)
Bank of America, N.A.	$	16,350	3 Month LIBOR	Receive		0	.80	%	10/28/13	$	150,093
Bank of America, N.A.		6,855	3 Month LIBOR	Pay		2	.098		10/28/17		(300,797	)
Bank of America, N.A.***	EUR	12,521	6 Month EURIBOR	Pay		3	.81		11/08/25		(420,521	)
Bank of America, N.A.***	$	11,974	3 Month LIBOR	Receive		4	.828		11/08/25		220,561
Bank of America, N.A.***	EUR	15,533	6 Month EURIBOR	Receive		3	.33		11/08/30		438,100
Bank of America, N.A.***	$	15,008	3 Month LIBOR	Pay		4	.75		11/08/30		(145,278	)
			Net Unrealized Depreciation							$	(57,842	)

See Notes to Financial Statements

46

Morgan Stanley Global Strategist Fund

Portfolio of Investments - January 31, 2011 (unaudited) continued

EURIBOR	Euro Interbank Offered Rate.
LIBOR	London Interbank Offered Rate.
***	Forward interest rate swap. Periodic payments on specified notional amount with future effective date, unless terminated earlier.
Currency Abbreviation:
EUR	Euro.

Zero Coupon Swap Contracts Open at January 31, 2011:

						UNREALIZED
	NOTIONAL		FLOATING	PAY/RECEIVE	TERMINATION	APPRECIATION
SWAP COUNTERPARTY	AMOUNT (000)		RATE INDEX	FLOATING RATE	DATE	(DEPRECIATION)
Barclays Bank PLC^	$	4,320	3 Month LIBOR	Receive	11/15/19	$	(502,724)
Barclays Bank PLC^ ^		4,320	3 Month LIBOR	Pay	11/15/19		47,398
Barclays Bank PLC^		3,685	3 Month LIBOR	Receive	11/15/21		(381,435)
JPMorgan Chase Bank N.A. New York^		2,790	3 Month LIBOR	Receive	05/15/21		(311,206)
	Net Unrealized Depreciation					$	(1,147,967)

LIBOR	London Interbank Offered Rate.
^	Fund will make the payments of $1,675,253, $1,650,364, and $1,221,824 respectively, on termination date.
^ ^	Fund will receive $1,186,272 on termination date.

See Notes to Financial Statements

47

Morgan Stanley Global Strategist Fund

Financial Statements

Statement of Assets and Liabilities

January 31, 2011 (unaudited)

Assets:
Investments in securities, at value (cost $453,421,776)	$	502,090,376
Investment in affiliate, at value (cost $94,865,983)		95,129,707
Unrealized appreciation on open swap contracts		856,152
Unrealized appreciation on open foreign currency exchange contracts		1,379,235
Cash (foreign currency with a cost of $5,810,319)		5,949,021
Receivable for:
Investments sold		10,249,189
Interest		2,006,416
Variation margin		1,258,637
Dividends		264,666
Shares of beneficial interest sold		264,464
Foreign withholding taxes reclaimed		184,956
Periodic interest on open swap contracts		38,479
Interest and Dividends from affiliates		16,105
Prepaid expenses and other assets		54,516
Total Assets		619,741,919
Liabilities:
Unrealized depreciation on open swap contracts		2,061,961
Unrealized depreciation on open foreign currency exchange contracts		853,334
Payable for:
Investments purchased		20,226,621
Due to broker		664,180
Shares of beneficial interest redeemed		524,185
Transfer agent fee		217,682
Investment advisory fee		187,417
Distribution fee		179,782
Administration fee		40,368
Periodic interest on open swap contracts		34,729
Accrued expenses and other payables		242,205
Total Liabilities		25,232,464
Net Assets	$	594,509,455
Composition of Net Assets:
Paid-in-capital	$	534,864,324
Net unrealized appreciation		49,045,735
Dividends in excess of net investment income		(3,048,409	)
Accumulated undistributed net realized gain		13,647,805
Net Assets	$	594,509,455
Class A Shares:
Net Assets		$475,307,977
Shares Outstanding (unlimited shares authorized, $.01 par value)		29,025,501
Net Asset Value Per Share		$16.38
Maximum Offering Price Per Share,
(net asset value plus 5.54% of net asset value)		$17.29
Class B Shares:
Net Assets		$47,615,190
Shares Outstanding (unlimited shares authorized, $.01 par value)		2,888,226
Net Asset Value Per Share		$16.49
Class C Shares:
Net Assets		$44,404,735
Shares Outstanding (unlimited shares authorized, $.01 par value)		2,726,775
Net Asset Value Per Share		$16.28
Class I Shares:
Net Assets		$27,181,553
Shares Outstanding (unlimited shares authorized, $.01 par value)		1,656,994
Net Asset Value Per Share		$16.40

See Notes to Financial Statements

48

Morgan Stanley Global Strategist Fund

Financial Statements continued

Statement of Operations

For the six months ended January 31, 2011 (unaudited)

Net Investment Income:
Income
Dividends (net of $140,087 foreign withholding tax)	$	3,070,579
Interest (net of $23,744 foreign withholding tax)		2,941,064
Interest and dividends from affiliates		172,137
Total Income		6,183,780
Expenses
Investment advisory fee		1,270,576
Distribution fee (Class A shares)		594,453
Distribution fee (Class B shares)		269,608
Distribution fee (Class C shares)		216,838
Transfer agent fees and expenses		329,801
Administration fee		242,015
Custodian fees		99,143
Shareholder reports and notices		83,283
Professional fees		70,007
Registration fees		30,579
Trustees’ fees and expenses		19,095
Other		61,521
Total Expenses		3,286,919
Less: rebate from Morgan Stanley affiliates (Note 6)		(74,325	)
Net Expenses		3,212,594
Net Investment Income		2,971,186
Realized and Unrealized Gain (Loss):
Realized Gain (Loss) on:
Investments		15,305,932
Investments in affiliates		33,329
Futures contracts		7,204,972
Swap contracts		(417,719	)
Foreign currency exchange contracts		8,719,438
Foreign currency translation		(3,860,679	)
Net Realized Gain		26,985,273
Change in Unrealized Appreciation/Depreciation on:
Investments		33,388,128
Investments in affiliates		(31,251	)
Futures contracts		(661,536	)
Swap contracts		415,955
Foreign currency exchange contracts		(1,661,334	)
Foreign currency translation		165,238
Net Change in Unrealized Appreciation/Depreciation		31,615,200
Net Gain		58,600,473
Net Increase	$	61,571,659

See Notes to Financial Statements

49

Morgan Stanley Global Strategist Fund

Financial Statements continued

Statements of Changes in Net Assets

	FOR THE SIX			FOR THE YEAR
	MONTHS ENDED			ENDED
	JANUARY 31, 2011			JULY 31, 2010
	(unaudited)
Increase (Decrease) in Net Assets:
Operations:
Net investment income	$	2,971,186		$	6,745,498
Net realized gain		26,985,273			122,393,285
Net change in unrealized appreciation/depreciation		31,615,200			(79,569,479	)
Net Increase		61,571,659			49,569,304
Dividends and Distributions to Shareholders from:
Net investment income
Class A shares		(3,087,668	)		(7,592,642	)
Class B shares		(116,860	)		(595,284	)
Class C shares		(127,307	)		(368,480	)
Class I shares		(268,166	)		(504,638	)
Net realized gain
Class A shares		(67,021,037	)		—
Class B shares		(7,180,925	)		—
Class C shares		(6,220,484	)		—
Class I shares		(4,887,060	)		—
Total Dividends and Distributions		(88,909,507	)		(9,061,044	)
Net increase (decrease) from transactions in shares of beneficial interest		36,878,184			(70,662,343	)
Net Increase (Decrease)		9,540,336			(30,154,083	)
Net Assets:
Beginning of period		584,969,119			615,123,202
End of Period
(Including divdends in excess of net investment income of $3,048,409 and $2,419,594, respectively)	$	594,509,455		$	584,969,119

See Notes to Financial Statements

50

Morgan Stanley Global Strategist Fund

Notes to Financial Statements - January 31, 2011 (unaudited)

1. Organization and Accounting Policies

Morgan Stanley Global Strategist Fund (the “Fund”), is registered under the Investment Company Act of 1940, as amended (the “Act”), as a diversified, open-end management investment company. The Fund’s investment objective is to maximize the total return on its investments. The Fund was organized as a Massachusetts business trust on August 5, 1988 and commenced operations on October 31, 1988. On July 28, 1997, the Fund converted to a multiple class share structure.

The Fund offers Class A shares, Class B shares, Class C shares and Class I shares. The four classes are substantially the same except that most Class A shares are subject to a sales charge imposed at the time of purchase and some Class A shares, and most Class B shares and Class C shares are subject to a contingent deferred sales charge imposed on shares redeemed within eighteen months, six years and one year, respectively. Class I shares are not subject to a sales charge. Additionally, Class A shares, Class B shares and Class C shares incur distribution expenses.

The following is a summary of significant accounting policies:

A. Valuation of Investments — (1) An equity portfolio security listed or traded on the New York Stock Exchange (“NYSE”) or American Stock Exchange or other domestic exchange is valued at its last sale price prior to the time when assets are valued; if there were no sales that day, the security is valued at the mean between the last reported bid and ask price; (2) an equity portfolio security listed or traded on the Nasdaq is valued at the Nasdaq Official Closing Price; if there were no sales that day, the security is valued at the mean between the last reported bid and ask price; (3) all other portfolio securities for which over-the-counter market quotations are readily available are valued at the mean between the last reported bid and ask price. In cases where a security is traded on more than one exchange, the security is valued on the exchange designated as the primary market; (4) for equity securities traded on foreign exchanges, the last reported sale price or the latest bid price may be used if there were no sales on a particular day; (5) futures are valued at the latest price published by the commodities exchange on which they trade; (6) commodity-linked notes are marked-to-market daily based upon quotations from market makers; (7) when market quotations are not readily available including, circumstances under which Morgan Stanley Investment Advisors Inc. (the “Investment Adviser”) a wholly owned subsidiary of Morgan Stanley determines that the latest sale price, the bid price or the mean between the last reported bid and ask price do not reflect a security’s market value, portfolio securities are valued at their fair value as determined in good faith under procedures established by and under the general supervision of the Fund’s Trustees. Occasionally, developments affecting the closing prices of securities and other assets may occur between the times at which valuations of such securities are determined (that is, close of the foreign market on which the securities trade) and the close of business on the NYSE. If developments occur during such periods that are expected to materially affect the value of such securities, such valuations may be adjusted to reflect the estimated fair value of such securities as of the

51

Morgan Stanley Global Strategist Fund

Notes to Financial Statements - January 31, 2011 (unaudited) continued

close of the NYSE, as determined in good faith by the Fund’s Trustees or by the Investment Adviser using a pricing service and/or procedures approved by the Trustees of the Fund; (8) certain portfolio securities may be valued by an outside pricing service approved by the Fund’s Trustees; (9) investments in open-end mutual funds, including the Morgan Stanley Institutional Funds, are valued at the net asset value as of the close of each business day; and (10) short-term debt securities having a maturity date of more than sixty days at time of purchase are valued on a mark-to-market basis until sixty days prior to maturity and thereafter at amortized cost based on their value on the 61st day. Short-term debt securities having a maturity date of sixty days or less at the time of purchase are valued at amortized cost, which approximates market value.

B. Accounting for Investments — Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses on security transactions are determined by the identified cost method. Dividend income and other distributions are recorded on the ex-dividend date. Discounts are accreted and premiums are amortized over the life of the respective securities and are included in interest income. Interest income is accrued daily as earned.

C. Multiple Class Allocations — Investment income, expenses (other than distribution fees), and realized and unrealized gains and losses are allocated to each class of shares based upon the relative net asset value on the date such items are recognized. Distribution fees are charged directly to the respective class.

D. Foreign Currency Translation — The books and records of the Fund are maintained in U.S. dollars as follows: (1) the foreign currency market value of investment securities, other assets and liabilities and foreign currency exchange contracts are translated at the exchange rates prevailing at the end of the period; and (2) purchases, sales, income and expenses are translated at the exchange rates prevailing on the respective dates of such transactions. The resultant exchange gains and losses are recorded as realized and unrealized gains/losses on foreign currency exchange contracts and foreign currency translations. Pursuant to U.S. federal income tax regulations, certain foreign exchange gains/losses included in realized and unrealized gains/losses are included in or are a reduction of ordinary income for federal income tax purposes. The Fund does not isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the changes in the market prices of the securities held.

E. Federal Income Tax Policy — It is the Fund’s policy to comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required. The Fund files tax returns with the U.S. Internal Revenue Service, New York State and New York City. The Fund recognizes the tax effects of a tax position taken or expected to be taken in a tax return only if it is more likely than not to be sustained based solely on its technical merits as of the reporting date. The more-likely-than-not threshold must continue to be met in each reporting period to support continued recognition of the benefit. The difference between the tax benefit recognized in the financial statements for a tax position taken

52

Morgan Stanley Global Strategist Fund

Notes to Financial Statements - January 31, 2011 (unaudited) continued

and the tax benefit claimed in the income tax return is referred to as an unrecognized tax benefit. There are no unrecognized tax benefits in the accompanying financial statements. If applicable, the Fund recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in other expenses in the Statement of Operations. Each of the tax years filed in the four-year period ended July 31, 2010 remains subject to examination by taxing authorities.

F. Dividends and Distributions to Shareholders — Dividends and distributions to shareholders are recorded on the ex-dividend date.

G. Use of Estimates — The preparation of financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.

H. Indemnifications — The Fund enters into contracts that contain a variety of indemnifications. The Fund’s maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.

2. Fair Valuation Measurements

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value as the price that the Fund would receive to sell an investment or pay to transfer a liability in a timely transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. ASC 820 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Fund’s investments. The inputs are summarized in the three broad levels listed below.

•  Level 1 — unadjusted quoted prices in active markets for identical investments

•  Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

•  Level 3 — significant unobservable inputs including the Fund’s own assumptions in determining the fair value of investments. Factors considered in making this determination may include, but are not limited

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to, information obtained by contacting the issuer, analysts, or the appropriate stock exchange (for exchange-traded securities), analysis of the issuer’s financial statements or other available documents and, if necessary, available information concerning other securities in similar circumstances.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities and the determination of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each security.

The following is a summary of the inputs used as of January 31, 2011 in valuing the Fund’s investments carried at fair value:

			FAIR VALUE MEASUREMENTS AT JANUARY 31, 2011 USING
			UNADJUSTED		OTHER
			QUOTED PRICES IN		SIGNIFICANT		SIGNIFICANT
			ACTIVE MARKETS FOR		OBSERVABLE		UNOBSERVABLE
			IDENTICAL INVESTMENTS		INPUTS		INPUTS
INVESTMENT TYPE	TOTAL		(LEVEL 1)		(LEVEL 2)		(LEVEL 3)
Assets:
Common Stocks
Aerospace & Defense	$	3,044,032	$	2,305,646	$	738,386		—
Air Freight & Logistics		642,466		—		642,466		—
Auto Components		1,908,335		943,910		964,425		—
Automobiles		6,592,560		3,266,764		3,325,796		—
Beverages		5,511,932		3,005,773		2,506,159		—
Biotechnology		327,430		—		327,430		—
Building Products		843,143		—		843,143		—
Capital Markets		9,636,375		6,711,686		2,924,689		—
Chemicals		6,243,871		1,938,752		4,305,119		—
Commercial Banks		25,115,842		8,327,783		16,788,059		—
Commercial Services & Supplies		832,172		120,594		711,578		—
Communications Equipment		4,453,810		3,374,506		1,079,304		—
Computers & Peripherals		6,008,030		5,510,447		497,583		—
Construction & Engineering		1,597,153		752,521		844,632		—
Construction Materials		314,526		—		314,526		—
Containers & Packaging		960,305		829,232		131,073		—
Distributors		966,743		836,590		130,153		—
Diversified Consumer Services		28,889		28,889		—		—
Diversified Financial Services		5,314,844		3,698,851		1,615,993		—
Diversified Telecommunication Services		7,265,560		3,439,781		3,825,779		—
Electric Utilities		4,028,086		68,907		3,959,179		—
Electrical Equipment		4,863,941		2,851,558		2,012,383		—
Electronic Equipment, Instruments & Components		4,885,732		3,201,930		1,683,802		—
Energy Equipment & Services		6,462,408		5,567,344		895,064		—
Food & Staples Retailing		6,270,801		2,740,325		3,530,476		—
Food Products		6,206,376		2,631,942		3,574,434		—
Gas Utilities		681,038		1,743		679,295		—

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

			FAIR VALUE MEASUREMENTS AT JANUARY 31, 2011 USING
			UNADJUSTED		OTHER
			QUOTED PRICES IN		SIGNIFICANT		SIGNIFICANT
			ACTIVE MARKETS FOR		OBSERVABLE		UNOBSERVABLE
			IDENTICAL INVESTMENTS		INPUTS		INPUTS
INVESTMENT TYPE	TOTAL		(LEVEL 1)		(LEVEL 2)		(LEVEL 3)
Health Care Equipment & Supplies	$	2,224,093	$	1,403,852	$	820,241		—
Health Care Providers & Services		3,964,571		3,637,301		327,270		—
Hotels, Restaurants & Leisure		3,100,454		2,233,935		866,519		—
Household Durables		1,638,677		937,181		701,496		—
Household Products		1,350,803		738,941		611,862		—
Independent Power Producers & Energy Traders		873,523		789,866		83,657		—
Industrial Conglomerates		4,387,520		1,998,399		2,389,121		—
Information Technology Services		2,854,270		2,569,713		284,557		—
Insurance		14,274,112		8,641,450		5,632,662		—
Internet & Catalog Retail		3,132,524		3,010,344		122,180		—
Internet Software & Services		4,180,759		4,076,818		103,941		—
Leisure Equipment & Products		129,967		23,680		106,287		—
Life Sciences Tools & Services		32,859		—		32,859		—
Machinery		6,631,972		3,268,755		3,363,217		—
Marine		638,110		—		638,110		—
Media		5,948,745		4,322,404		1,626,341		—
Metals & Mining		19,052,509		10,428,837		8,623,672		—
Multi-Utilities		3,112,203		1,355,478		1,756,725		—
Multiline Retail		585,577		200,287		385,290		—
Office Electronics		1,330,279		421,465		908,814		—
Oil, Gas & Consumable Fuels		35,789,935		26,642,207		9,147,728		—
Paper & Forest Products		1,164,289		734,302		429,987		—
Personal Products		2,810,942		2,070,546		740,396		—
Pharmaceuticals		22,070,481		14,513,197		7,557,284		—
Professional Services		371,928		—		371,928		—
Real Estate Investment Trusts (REITs)		3,499,423		1,867,315		1,632,108		—
Real Estate Management & Development		2,497,531		411,039		2,086,492		—
Road & Rail		8,410,588		6,881,948		1,528,640		—
Semiconductors & Semiconductor Equipment		12,741,629		12,010,460		731,169		—
Software		4,847,654		3,576,277		1,271,377		—
Specialty Retail		2,193,684		1,290,729		902,955		—
Textiles, Apparel & Luxury Goods		3,049,250		1,151,409		1,897,841		—
Tobacco		4,578,596		3,039,357		1,539,239		—
Trading Companies & Distributors		1,762,231		—		1,762,231		—
Transportation Infrastructure		305,052		102,169		202,883		—
Wireless Telecommunication Services		4,115,511		819,774		3,295,737		—
Total Common Stocks		310,658,651		187,324,909		123,333,742		—
Preferred Stocks		5,019,515		4,370,044		649,471		—
Rights		16,379		16,379		—		—
Corporate Bonds		49,205,535		—		49,205,535		—

55

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

				FAIR VALUE MEASUREMENTS AT JANUARY 31, 2011 USING
				UNADJUSTED			OTHER
				QUOTED PRICES IN			SIGNIFICANT		SIGNIFICANT
				ACTIVE MARKETS FOR			OBSERVABLE		UNOBSERVABLE
				IDENTICAL INVESTMENTS			INPUTS		INPUTS
INVESTMENT TYPE	TOTAL			(LEVEL 1)			(LEVEL 2)		(LEVEL 3)
Foreign Government Obligations	$	70,364,138		$	—		$	70,364,138		—
Municipal Bonds		578,234			—			578,234		—
U.S. Government Agencies - Mortgage-Backed Securities		16,553,003			—			16,553,003		—
Asset-Backed Securities		1,204,972			—			1,204,972		—
U.S. Government Agencies & Obligations		21,769,184			—			21,769,184		—
Commodity-Linked Security		20,826,251			—			20,826,251		—
Investment Trust		6,423,880			6,423,880			—		—
Investment Company		1,228,832			1,228,832			—		—
Short-Term Investments
U.S. Government Obligation		2,419,121			—			2,419,121		—
Investment Company		90,952,388			90,952,388			—		—
Total Short-Term Investments		93,371,509			90,952,388			2,419,121		—
Foreign Currency Exchange Contracts		1,379,235			—			1,379,235		—
Futures		1,805,989			1,805,989			—		—
Interest Rate Swaps		808,754			—			808,754		—
Zero Coupon Swaps		47,398			—			47,398		—
Total	$	601,261,459		$	292,122,421		$	309,139,038		—
Liabilities:
Foreign Currency Exchange Contracts	$	(853,334	)		—		$	(853,334)		—
Futures		(1,223,133	)	$	(1,223,133	)		—		—
Interest Rate Swaps		(866,596	)		—			(866,596)		—
Zero Coupon Swaps		(1,195,365	)		—			(1,195,365)		—
Total	$	(4,138,428	)	$	(1,223,133	)	$	(2,915,295)		—

Transfers between investment levels may occur as the markets fluctuate and/or the availability of data used in an investment’s valuation changes. The Fund recognizes transfers between the Levels as of the end of the period. As of January 31, 2011, securities with a total value of $119,743,936 transferred from Level 1 to Level 2. At January 31, 2011 the fair market value of certain securities were adjusted due to developments which occurred between the time of the close of the foreign markets on which they trade and the close of business on the NYSE which resulted in their Level 2 classification.

3. Derivatives

The Fund used derivative instruments for a variety of purposes, including hedging, risk management, portfolio management or to earn income. Derivatives are financial instruments whose value is based on the value of another underlying asset, interest rate, index or financial instrument. A derivative instrument often

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

has risks similar to its underlying instrument and may have additional risks, including imperfect correlation between the value of the derivative and the underlying instrument, risks of default by the other party to certain transactions, magnification of losses incurred due to changes in the market value of the securities, instruments, indices or interest rates to which they relate, and risks that the transactions may not be liquid. The use of derivatives involves risks that are different from, and possibly greater than, the risks associated with other portfolio investments. Derivatives may involve the use of highly specialized instruments that require investment techniques and risk analyses different from those associated with other portfolio investments. All of the Fund’s holdings, including derivative instruments, are marked-to-market each day with the change in value reflected in unrealized appreciation (depreciation). Upon disposition, a realized gain or loss is recognized.

Certain derivative transactions may give rise to a form of leverage. Leverage associated with derivative transactions may cause the Fund to liquidate portfolio positions when it may not be advantageous to do so to satisfy its obligations or to meet earmarking or segregation requirements, pursuant to applicable Securities and Exchange Commission (“SEC”) rules and regulations, or may cause the Fund to be more volatile than if the Fund had not been leveraged. Although the Investment Adviser seeks to use derivatives to further the Fund’s investment objectives, there is no assurance that the use of derivatives will achieve this result.

Following is a description of the derivative instruments and techniques that the Fund used during the period and their associated risks:

Foreign Currency Exchange Contracts  In connection with its investments in foreign securities, the Fund entered into contracts with banks, brokers or dealers to purchase or sell foreign currencies at a future date. A foreign currency exchange contract (“currency contracts”) is a negotiated agreement between the contracting parties to exchange a specified amount of currency at a specified future time at a specified rate. The rate can be higher or lower than the spot rate between the currencies that are the subject of the currency contract. Currency contracts are used to protect against uncertainty in the level of future foreign currency exchange rates or to gain or modify exposure to a particular currency. Hedging the Fund’s currency risks involves the risk of mismatching the Fund’s objectives under a currency contract with the value of securities denominated in a particular currency. Furthermore, such transactions reduce or preclude the opportunity for gain if the value of the currency should move in the direction opposite to the position taken. There is an additional risk to the effect that currency contracts create exposure to currencies in which the Fund’s securities are not denominated. Unanticipated changes in currency prices may result in poorer overall performance for the Fund than if it had not entered into such contracts. A currency contract is marked-to-market daily and the change in market value is recorded by the Fund as unrealized gain or (loss).

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

The Fund records realized gains (losses) when the currency contract is closed equal to the difference between the value of the currency contract at the time it was opened and the value at the time it was closed.

During the six months ended January 31, 2011, the value of foreign currency exchange contracts purchased and sold were $871,059,986 and $901,210,652, respectively.

Futures  A futures contract is a standardized agreement between two parties to buy or sell a specific quantity of an underlying instrument at a specific price at a specific future time. The value of a futures contract tends to increase and decrease in tandem with the value of the underlying instrument. Futures contracts are bilateral agreements, with both the purchaser and the seller equally obligated to complete the transaction. Depending on the terms of the particular contract, futures contracts are settled through either physical delivery of the underlying instrument on the settlement date or by payment of a cash settlement amount on the settlement date. During the period the futures contract is open, payments are received from or made to the broker based upon changes in the value of the contract (the variation margin). A decision as to whether, when and how to use futures involves the exercise of skill and judgment and even a well conceived futures transaction may be unsuccessful because of market behavior or unexpected events. In addition to the derivatives risks discussed above, the prices of futures can be highly volatile, using futures can lower total return, and the potential loss from futures can exceed the Fund’s initial investment in such contracts.

Transactions in futures contracts for the six months ended January 31, 2011, were as follows:

	NUMBER OF
	CONTRACTS
Futures, outstanding at beginning of the period		2,342
Futures opened		19,220
Futures closed		(19,449	)
Futures, outstanding at end of the period		2,113

Swaps  A swap agreement is an agreement between two parties pursuant to which the parties exchange payments at specified dates on the basis of a specified notional amount, with the payments calculated by reference to specified securities, indexes, reference rates, currencies or other instruments. Most swap agreements provide that when the period payment dates for both parties are the same, the payments are made on a net basis (i.e., the two payment streams are netted out, with only the net amount paid by one party to the other). The Fund’s obligations or rights under a swap agreement entered into on a net basis will generally be equal only to the net amount to be paid or received under the agreement, based on the relative values of the positions held by each counterparty. Swap agreements are not entered into or traded on exchanges and there is no central clearing or guaranty function for swaps. Therefore, swaps are subject to credit risk or the risk of default or non-performance by the counterparty. Swaps could result in losses if

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

interest rate, foreign currency exchange rates or credit quality changes are not correctly anticipated by the Fund or if the reference index, security or investments do not perform as expected.

The Fund’s use of swaps during the period included those based on the credit of an underlying security and commonly referred to as credit default swaps. Where the Fund is the buyer of a credit default swap agreement, it would be entitled to receive the par (or other agreed-upon) value of a referenced debt obligation from the counterparty to the agreement only in the event of a default by a third party on the debt obligation. If no default occurs, the Fund would have paid to the counterparty a periodic stream of payments over the term of the agreement and received no benefit from the agreement. When the Fund is the seller of a credit default swap agreement, it receives the stream of payments but is obligated to pay upon default of the referenced debt obligation. Alternatively, for credit default swaps on an index of credits, the quoted market prices and current values serve as an indicator of the current status of the payment/performance risk of the credit derivative. Generally, lower credit ratings and increasing market values, in absolute terms, represent a deterioration of the credit and a greater likelihood of an adverse credit event of the issuer.

When the Fund has an unrealized loss on a swap agreement, the Fund has instructed the custodian to pledge cash or liquid securities as collateral with a value approximately equal to the amount of the unrealized loss. Collateral pledges are monitored and subsequently adjusted if and when the swap valuations fluctuate. Cash collateral is included with “Due from (to) Broker” on the Statement of Assets and Liabilities. Cash collateral has been offset against open swap agreements under the provisions of FASB ASC 210, Balance Sheet (“ASC 210”). For cash collateral received, the Fund pays a monthly fee to the counterparty based on the effective rate for Federal Funds. This fee, when paid, is included within realized gain (loss) on swap agreements on the Statement of Operations.

Upfront payments received or paid by the Fund will be reflected as an asset or liability on the Statement of Assets and Liabilities.

Transactions in swap contracts for the six months ended January 31, 2011, were as follows:

	NOTIONAL		NOTIONAL
	AMOUNT		AMOUNT
	EUR (000’S)		USD (000’S)
Swaps, outstanding at beginning of period		—	$	20,510
Swaps opened		28,054		126,696
Swaps closed		—		(81,904	)
Swaps, outstanding at end of period		EUR 28,054	$	65,302

FASB ASC 815, Derivatives and Hedging: Overall (“ASC 815”), is intended to improve financial reporting about derivative instruments by requiring enhanced disclosures to enable investors to better understand how

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

and why the Fund uses derivative instruments, how these derivative instruments are accounted for and their effects on the Fund’s financial position and results of operations.

The following table sets forth the fair value of the Fund’s derivative contracts by primary risk exposure as of January 31, 2011.

	ASSET DERIVATIVES				LIABILITY DERIVATIVES
	STATEMENT OF ASSETS				STATEMENT OF ASSETS
PRIMARY RISK EXPOSURE	AND LIABILITIES LOCATION	FAIR VALUE			AND LIABILITIES LOCATION	FAIR VALUE
Interest Rate Risk	Variation margin	$	763,365	†	Variation margin	$	(218,335	)†
	Unrealized appreciation				Unrealized depreciation
	on open swap contracts		856,152		on open swap contracts		(2,061,961	)
Foreign Currency Risk	Unrealized appreciation on open foreign currency exchange contracts		1,379,235		Unrealized depreciation on open foreign currency exchange contracts		(853,334	)
Equity Risk	Variation margin		1,042,624	†	Variation margin		(1,004,798	)†
		$	4,041,376			$	(4,138,428	)

† Includes cumulative appreciation/depreciation of futures contracts as reported in the Portfolio of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities.

The following tables set forth by primary risk exposure the Fund’s realized gains (losses) and change in unrealized appreciation/depreciation by type of derivative contract for the six months ended January 31, 2011 in accordance with ASC 815.

AMOUNT OF REALIZED GAIN (LOSS) ON DERIVATIVE CONTRACTS
				FOREIGN CURRENCY
PRIMARY RISK EXPOSURE	FUTURES			EXCHANGE		SWAPS
Interest Rate Risk	$	(750,574	)		—	$	(52,723	)
Credit Risk		—			—		7,456
Foreign Currency Risk		—		$	8,719,438		—
Equity Risk		7,955,546			—		(372,452	)
Total	$	7,204,972		$	8,719,438	$	(417,719	)

CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON DERIVATIVE CONTRACTS
				FOREIGN CURRENCY
PRIMARY RISK EXPOSURE	FUTURES			EXCHANGE			SWAPS
Interest Rate Risk	$	879,013			—		$	364,307
Credit Risk		—			—			51,648
Foreign Currency Risk		—		$	(1,661,334	)		—
Equity Risk		(1,540,549	)		—			—
Total	$	(661,536	)	$	(1,661,334	)	$	415,955

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

4. Investment Advisory/Administration Agreements

Pursuant to an Investment Advisory Agreement with the Investment Adviser, the Fund pays an advisory fee, accrued daily and payable monthly, by applying the following annual rates to the net assets of the Fund determined as of the close of each business day: 0.42% to the portion of the daily net assets not exceeding $1.5 billion and 0.395% to the portion of the daily net assets exceeding $1.5 billion.

Pursuant to an Administration Agreement with Morgan Stanley Services Company Inc. (the “Administrator”), an affiliate of the Investment Adviser, the Fund pays an administration fee, accrued daily and payable monthly, by applying the annual rate of 0.08% to the Fund’s daily net assets.

Under a Sub-Administration Agreement between the Administrator and State Street Bank and Trust Company (“State Street”), State Street provides certain administrative services to the Fund. For such services, the Administrator pays State Street a portion of the fee the Administrator receives from the Fund.

5. Plan of Distribution

Shares of the Fund are distributed by Morgan Stanley Distributors Inc. (the “Distributor”), an affiliate of the Investment Adviser and Administrator. The Fund has adopted a Plan of Distribution (the “Plan”) pursuant to Rule 12b-1 under the Act. The Plan provides that the Fund will pay the Distributor a fee which is accrued daily and paid monthly at the following annual rates: (i) Class A – up to 0.25% of the average daily net assets of Class A shares; (ii) Class B – up to 1.0% of the average daily net assets of Class B shares; and (iii) Class C – up to 1.0% of the average daily net assets of Class C shares.

In the case of Class B shares, provided that the Plan continues in effect, any cumulative expenses incurred by the Distributor but not yet recovered may be recovered through the payment of future distribution fees from the Fund pursuant to the Plan and contingent deferred sales charges paid by investors upon redemption of Class B shares. Although there is no legal obligation for the Fund to pay expenses incurred in excess of payments made to the Distributor under the Plan and the proceeds of contingent deferred sales charges paid by investors upon redemption of shares, if for any reason the Plan is terminated, the Trustees will consider at that time the manner in which to treat such expenses. The Distributor has advised the Fund that such excess amounts totaled $11,923,182 at January 31, 2011.

In the case of Class A shares and Class C shares, expenses incurred pursuant to the Plan in any calendar year in excess of 0.25% or 1.0% of the average daily net assets of Class A or Class C, respectively, will not be reimbursed by the Fund through payments in any subsequent year, except that expenses representing a gross sales credit to Morgan Stanley Financial Advisors and other authorized financial representatives at the time of sale may be reimbursed in the subsequent calendar year. For the six months ended January 31, 2011, the distribution fee was accrued for Class A shares and Class C shares at the annual rate of 0.25% and 1.0%, respectively.

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

The Distributor has informed the Fund that for the six months ended January 31, 2011, it received contingent deferred sales charges from certain redemptions of the Fund’s Class A shares, Class B shares and Class C shares of $1,083, $14,194 and $1,657, respectively and received $51,068 in front-end sales charges from sales of the Fund’s Class A shares. The respective shareholders pay such charges which are not an expense of the Fund.

6. Security Transactions and Transactions with Affiliates

The Fund invests in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class, an open-end management investment company managed by an affiliate of the Investment Adviser. Investment advisory fees paid by the Fund are reduced by an amount equal to the advisory and administrative service fees paid by Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class with respect to assets invested by the Fund in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class. For the six months ended January 31, 2011, advisory fees paid were reduced by $73,140 relating to the Fund’s investment in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class. Income distributions earned by the Fund are included in “interest and dividends from affiliates” in the Statement of Operations and totaled $118,303 for the six months ended January 31, 2011. During the six months ended January 31, 2011, the cost of purchases and sales of investments in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class aggregated $113,292,013 and $137,609,010, respectively.

The Fund invested in the Institutional Class of the Morgan Stanley Institutional Fund, Inc. – Emerging Markets Portfolio, an open-end management investment company managed by an affiliate of the Adviser. The Morgan Stanley Institutional Fund, Inc. – Emerging Markets Portfolio has a cost basis of approximately $1,300,000 at January 31, 2011. Investment Advisory fees paid by the Fund were reduced by an amount equal to its pro-rata share of the advisory and administration fees paid by the Morgan Stanley Institutional Fund, Inc. – Emerging Markets Portfolio. For the six months ended January 31, 2011, advisory fees paid were reduced by approximately $1,185 relating to the Fund’s investment in the Morgan Stanley Institutional Fund, Inc. – Emerging Markets Portfolio.

A summary of the Fund’s transactions in shares of the Morgan Stanley Institutional Fund, Inc. – Emerging Markets Portfolio during the year ended December 31, 2010 is as follows:

PURCHASES		SALES		REALIZED GAIN		INCOME		VALUE
$	1,300,000	$	—	$	—	$	—	$	1,228,832

The cost of purchases and proceeds from sales/maturities/prepayments of portfolio securities, excluding short-term investments, for the six months ended January 31, 2011 aggregated $333,068,522 and

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Notes to Financial Statements - January 31, 2011 (unaudited) continued

$348,000,728, respectively. Included in the aforementioned are purchases and sales/maturities/prepayments of U.S. Government securities of $90,630,394 and $97,948,292, respectively.

For the six months ended January 31, 2011, the Fund incurred brokerage commissions of $545 with Citigroup, Inc., and its affiliated broker/dealers which are affiliates of the Investment Adviser, Administrator and Distributor, for portfolio transactions executed on behalf of the Fund.

The Fund had the following transactions with Citigroup, Inc., and it’s affiliated broker/dealers which are affiliates of the Investment Adviser, Administrator and Distributor for the six months ended January 31, 2011:

PURCHASES		SALES		REALIZED GAIN		INCOME		VALUE
$	509,047	$	698,577	$	33,329	$	53,834	$	2,948,486

Morgan Stanley Services Company Inc., an affiliate of the Investment Adviser and Distributor, is the Fund’s transfer agent.

The Fund has an unfunded noncontributory defined benefit pension plan covering certain independent Trustees of the Fund who will have served as independent Trustees for at least five years at the time of retirement. Benefits under this plan are based on factors which include years of service and compensation. The Trustees voted to close the plan to new participants and eliminate the future benefits growth due to increases to compensation after July 31, 2003. At January 31, 2011, the Fund had an accrued pension liability of $69,173, which is included in “accrued expenses and other payables” in the Statement of Assets and Liabilities.

The Fund has an unfunded Deferred Compensation Plan (the “Compensation Plan”) which allows each independent Trustee to defer payment of all, or a portion, of the fees he or she receives for serving on the Board of Trustees. Each eligible Trustee generally may elect to have the deferred amounts credited with a return equal to the total return on one or more of the Morgan Stanley funds that are offered as investment options under the Compensation Plan. Appreciation/depreciation and distributions received from these investments are recorded with an offsetting increase/decrease in the deferred compensation obligation and do not affect the net asset value of the Fund.

7. Purposes of and Risks Relating to Certain Financial Instruments

The Fund may invest in mortgage securities, including securities issued by Federal National Mortgage Associaton (“FNMA”) and Federal Home Loan Mortgage Corporation (“FHLMC”). These are fixed income securities that derive their value from or represent interests in a pool of mortgages or mortgage securities. An unexpectedly high rate of defaults on the mortgages held by a mortgage pool may adversely affect the value of a mortgage backed security and could result in losses to the Fund. The risk of such defaults is generally higher in the case of mortgage pools that include subprime mortgages. Subprime mortgages refer

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Morgan Stanley Global Strategist Fund

Notes to Financial Statements - January 31, 2011 (unaudited) continued

to loans made to borrowers with weakened credit histories or with a lower capacity to make timely payments on their mortgages. The securities held by the Fund are not backed by subprime mortgages.

Additionally, securities issued by FNMA and FHLMC are not backed by or entitled to the full faith and credit of the United States; rather, they are supported by the right of the issuer to borrow from the U.S. Department of the Treasury.

The Federal Housing Finance Agency (“FHFA”) serves as conservator of FNMA and FHLMC and the U.S. Department of the Treasury has agreed to provide capital as needed to ensure FNMA and FHLMC continue to provide liquidity to the housing and mortgage markets.

Structured investments are designed to offer a return linked to a particular underlying security, currency or market. Structured investments may come in various forms including notes, warrants and options to purchase securities. The Fund will typically use structured investments to gain exposure to a permitted underlying security, currency or market when direct access to a market is limited or inefficient from a tax or cost standpoint. Investments in structured investments involve risks including counterparty risk and market risk. Holders of structured investments bear risks of the underlying investment and are subject to counterparty risk because the Fund is relying on the creditworthiness of such counterparty and has no rights with respect to the underlying investment. Certain structured investments may be thinly traded or have a limited trading market and may have the effect of increasing the Fund’s illiquidity to the extent that the Fund, at a particular point in time, may be unable to find qualified buyers for these securities.

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Morgan Stanley Global Strategist Fund

Notes to Financial Statements - January 31, 2011 (unaudited) continued

8. Shares of Beneficial Interest

Transactions in shares of beneficial interest were as follows:

	FOR THE SIX						FOR THE YEAR
	MONTHS ENDED						ENDED
	JANUARY 31, 2011						JULY 31, 2010
	(unaudited)
	SHARES			AMOUNT			SHARES			AMOUNT
CLASS A SHARES
Sold		1,089,464		$	18,860,190			2,666,468		$	45,553,257
Conversion from Class B		79,573			1,383,735			213,970			3,668,628
Reinvestment of dividends and distributions		4,315,526			68,314,776			433,251			7,428,957
Redeemed		(2,994,889	)		(51,520,495	)		(4,994,013	)		(85,274,484	)
Net increase (decrease) – Class A		2,489,674			37,038,206			(1,680,324	)		(28,623,642	)
CLASS B SHARES
Sold		95,272			1,660,113			348,022			5,974,962
Conversion from Class A		(79,191	)		(1,383,735	)		(212,961	)		(3,668,628	)
Reinvestment of dividends and distributions		439,740			7,013,859			33,064			570,595
Redeemed		(872,618	)		(15,238,590	)		(2,389,608	)		(41,014,879	)
Net decrease – Class B		(416,797	)		(7,948,353	)		(2,221,483	)		(38,137,950	)
CLASS C SHARES
Sold		148,885			2,609,510			360,587			6,110,412
Reinvestment of dividends and distributions		395,596			6,234,588			21,119			361,046
Redeemed		(220,953	)		(3,790,504	)		(467,106	)		(7,919,714	)
Net increase (decrease) – Class C		323,528			5,053,594			(85,400	)		(1,448,256	)
CLASS I SHARES
Sold		449,039			7,797,826			99,690			1,697,831
Reinvestment of dividends and distributions		273,430			4,336,592			29,110			499,590
Redeemed		(576,941	)		(9,399,681	)		(272,343	)		(4,649,916	)
Net increase (decrease) – Class I		145,528			2,734,737			(143,543	)		(2,452,495	)
Net increase (decrease) in Fund		2,541,933		$	36,878,184			(4,130,750	)	$	(70,662,343	)

9. Federal Income Tax Status

The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations which may differ from GAAP. These “book/tax” differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the capital accounts based on their federal tax-basis treatment; temporary differences do not require reclassification. Dividends and distributions which exceed net investment income and net realized capital gains for tax purposes are reported as distributions of paid-in-capital.

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Morgan Stanley Global Strategist Fund

Notes to Financial Statements - January 31, 2011 (unaudited) continued

As of July 31, 2010, the Fund had temporary book/tax differences primarily attributable to mark-to-market of open futures and foreign currency exchange contracts, and passive foreign investment companies, capital loss deferrals on straddles and wash sales and book amortization of premiums on debt securities.

10. Expense Offset

The Fund has entered into an arrangement with State Street Bank and Trust Company, (the “Custodian”), whereby credits realized on uninvested cash balances were used to offset a portion of the Fund’s expenses. If applicable, these custodian credits are shown as “Expense Offset” in the Statement of Operations.

11. Accounting Pronouncement

On January 21, 2010, FASB issued Accounting Standards Update (“ASU”) 2010-06. The ASU amends ASC 820 to add new requirements for disclosures about significant transfers into and out of Levels 1 and 2, which the Fund has adopted and made the required disclosures in the Fair Valuation Measurements footnote. In addition, separate disclosures for purchases, sales, issuances and settlements relating to Level 3 measurements are required for fiscal years and interim periods beginning after December 15, 2010.

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Morgan Stanley Global Strategist Fund

Financial Highlights

Selected ratios and per share data for a share of beneficial interest outstanding throughout each period:

	FOR THE SIX
	MONTHS ENDED			FOR THE YEAR ENDED JULY 31,
	JANUARY 31, 2011			2010			2009			2008			2007			2006
	(unaudited)
Class A Shares
Selected Per Share Data:
Net asset value, beginning of period		$17.33			$16.23			$18.07			$20.57			$19.74			$18.31
Income (loss) from investment operations:
Net investment income(1)		0.10			0.21			0.25			0.45			0.50			0.34
Net realized and unrealized gain (loss)		1.69			1.17			(1.74	)		(1.23	)		2.07			1.40
Total income (loss) from investment operations		1.79			1.38			(1.49	)		(0.78	)		2.57			1.74
Less dividends and distributions from:
Net investment income		(0.12	)		(0.28	)		(0.30	)		(0.49	)		(0.51	)		(0.31	)
Net realized gain		(2.62	)		—			(0.05	)		(1.23	)		(1.23	)		—
Total dividends and distributions		(2.74	)		(0.28	)		(0.35	)		(1.72	)		(1.74	)		(0.31	)
Net asset value, end of period		$16.38			$17.33			$16.23			$18.07			$20.57			$19.74
Total Return(2)		10.89	%(6)		8.52	%		(8.06	)%		(4.27	)%		13.30	%		9.60		%
Ratios to Average Net Assets(3):
Total expenses		0.96	%(4)(7)		0.91	%(4)		0.95	%(4)		0.90	%(4)		0.92	%(4)		0.93		%
Net investment income		1.08	%(4)(7)		1.24	%(4)		1.64	%(4)		2.30	%(4)		2.44	%(4)		1.78		%
Rebate from Morgan Stanley affiliate		0.02	%(7)		0.03	%		0.02	%		0.02	%		0.00	%(5)		—
Supplemental Data:
Net assets, end of period, in thousands		$475,308			$459,742			$457,914			$504,350			$553,395			$483,553
Portfolio turnover rate		68	%(6)		173	%		83	%		42	%		42	%		43		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	The ratios reflect the rebate of certain Fund expenses in connection with investments in a Morgan Stanley affiliate during the period. The effect of the rebate on the ratios is disclosed in the above table as “Rebate from Morgan Stanley affiliate.”
(5)	Amount is less than 0.005%.
(6)	Not annualized.
(7)	Annualized.

See Notes to Financial Statements

67

Morgan Stanley Global Strategist Fund

Financial Highlights continued

	FOR THE SIX
	MONTHS ENDED			FOR THE YEAR ENDED JULY 31,
	JANUARY 31, 2011			2010			2009			2008			2007			2006
	(unaudited)
Class B Shares
Selected Per Share Data:
Net asset value, beginning of period		$17.42			$16.30			$18.14			$20.63			$19.79			$18.36
Income (loss) from investment operations:
Net investment income(1)		0.03			0.08			0.14			0.30			0.35			0.19
Net realized and unrealized gain (loss)		1.70			1.18			(1.75	)		(1.23	)		2.07			1.41
Total income (loss) from investment operations		1.73			1.26			(1.61	)		(0.93	)		2.42			1.60
Less dividends and distributions from:
Net investment income		(0.04	)		(0.14	)		(0.18	)		(0.33	)		(0.35	)		(0.17	)
Net realized gain		(2.62	)		—			(0.05	)		(1.23	)		(1.23	)		—
Total dividends and distributions		(2.66	)		(0.14	)		(0.23	)		(1.56	)		(1.58	)		(0.17	)
Net asset value, end of period		$16.49			$17.42			$16.30			$18.14			$20.63			$19.79
Total Return(2)		10.47	%(6)		7.74	%		(8.77	)%		(5.02	)%		12.50	%		8.72		%
Ratios to Average Net Assets(3):
Total expenses		1.71	%(4)(7)		1.66	%(4)		1.70	%(4)		1.66	%(4)		1.67	%(4)		1.68		%
Net investment income		0.33	%(4)(7)		0.49	%(4)		0.89	%(4)		1.54	%(4)		1.69	%(4)		1.03		%
Rebate from Morgan Stanley affiliate		0.02	%(7)		0.03	%		0.02	%		0.02	%		0.00	%(5)		—
Supplemental Data:
Net assets, end of period, in thousands		$47,615			$57,559			$90,105			$175,410			$276,329			$302,702
Portfolio turnover rate		68	%(6)		173	%		83	%		42	%		42	%		43		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	The ratios reflect the rebate of certain Fund expenses in connection with investments in a Morgan Stanley affiliate during the period. The effect of the rebate on the ratios is disclosed in the above table as “Rebate from Morgan Stanley affiliate.”
(5)	Amount is less than 0.005%.
(6)	Not annualized.
(7)	Annualized.

See Notes to Financial Statements

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Morgan Stanley Global Strategist Fund

Financial Highlights continued

	FOR THE SIX
	MONTHS ENDED				FOR THE YEAR ENDED JULY 31,
	JANUARY 31, 2011				2010			2009			2008			2007			2006
	(unaudited)
Class C Shares
Selected Per Share Data:
Net asset value, beginning of period		$17.24				$16.15			$17.99			$20.48			$19.66			$18.24
Income (loss) from investment operations:
Net investment income(1)		0.03				0.08			0.14			0.30			0.35			0.20
Net realized and unrealized gain (loss)		1.68				1.16			(1.74	)		(1.22	)		2.06			1.40
Total income (loss) from investment operations		1.71				1.24			(1.60	)		(0.92	)		2.41			1.60
Less dividends and distributions from:
Net investment income		(0.05	)			(0.15	)		(0.19	)		(0.34	)		(0.36	)		(0.18	)
Net realized gain		(2.62	)			—			(0.05	)		(1.23	)		(1.23	)		—
Total dividends and distributions		(2.67	)			(0.15	)		(0.24	)		(1.57	)		(1.59	)		(0.18	)
Net asset value, end of period		$16.28				$17.24			$16.15			$17.99			$20.48			$19.66
Total Return(2)		10.40		%(7)		7.76	%		(8.78	)%		(4.94	)%		12.47	%		8.79		%
Ratios to Average Net Assets(3):
Total expenses		1.71		%(4)(8)		1.66	%(4)		1.70	%(4)		1.64	%(4)(5)		1.64	%(4)		1.64		%
Net investment income		0.33		%(4)(8)		0.49	%(4)		0.89	%(4)		1.56	%(4)(5)		1.72	%(4)		1.07		%
Rebate from Morgan Stanley affiliate		0.02		%(8)		0.03	%		0.02	%		0.02	%		0.00	%(6)		—
Supplemental Data:
Net assets, end of period, in thousands		$44,405				$41,439			$40,203			$44,664			$48,192			$39,887
Portfolio turnover rate		68		%(7)		173	%		83	%		42	%		42	%		43		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	The ratios reflect the rebate of certain Fund expenses in connection with investments in a Morgan Stanley affiliate during the period. The effect of the rebate on the ratios is disclosed in the above table as “Rebate from Morgan Stanley affiliate.”
(5)	If the Fund had borne all of its expenses that were reimbursed or waived by the Investment Adviser and Administrator, the annualized expense and net investment income ratios would have been 1.65% and 1.55%, respectively.
(6)	Amount is less than 0.005%.
(7)	Not annualized.
(8)	Annualized.

See Notes to Financial Statements

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Morgan Stanley Global Strategist Fund

Financial Highlights continued

	FOR THE SIX
	MONTHS ENDED				FOR THE YEAR ENDED JULY 31,
	JANUARY 31, 2011				2010			2009			2008			2007			2006
	(unaudited)
Class I Shares
Selected Per Share Data:
Net asset value, beginning of period		$17.35				$16.25			$18.10			$20.59			$19.76			$18.34
Income (loss) from investment operations:
Net investment income(1)		0.12				0.25			0.29			0.51			0.55			0.39
Net realized and unrealized gain (loss)		1.69				1.17			(1.75	)		(1.23	)		2.07			1.39
Total income (loss) from investment operations		1.81				1.42			(1.46	)		(0.72	)		2.62			1.78
Less dividends and distributions from:
Net investment income		(0.14	)			(0.32	)		(0.34	)		(0.54	)		(0.56	)		(0.36	)
Net realized gain		(2.62	)			—			(0.05	)		(1.23	)		(1.23	)		—
Total dividends and distributions		(2.76	)			(0.32	)		(0.39	)		(1.77	)		(1.79	)		(0.36	)
Net asset value, end of period		$16.40				$17.35			$16.25			$18.10			$20.59			$19.76
Total Return(2)		10.94		%(6)		8.84	%		(7.86	)%		(4.02	)%		13.62	%		9.80		%
Ratios to Average Net Assets(3):
Total expenses		0.71		%(4)(7)		0.66	%(4)		0.70	%(4)		0.66	%(4)		0.67	%(4)		0.68		%
Net investment income		1.33		%(4)(7)		1.49	%(4)		1.89	%(4)		2.54	%(4)		2.69	%(4)		2.03		%
Rebate from Morgan Stanley affiliate		0.02		%(7)		0.03	%		0.02	%		0.02	%		0.00	%(5)		—
Supplemental Data:
Net assets, end of period, in thousands		$27,182				$26,228			$26,901			$27,823			$66,753			$58,521
Portfolio turnover rate		68		%(6)		173	%		83	%		42	%		42	%		43		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	The ratios reflect the rebate of certain Fund expenses in connection with investments in a Morgan Stanley affiliate during the period. The effect of the rebate on the ratios is disclosed in the above table as “Rebate from Morgan Stanley affiliate.”
(5)	Amount is less than 0.005%.
(6)	Not annualized.
(7)	Annualized.

See Notes to Financial Statements

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Morgan Stanley Global Strategist Fund

An Important Notice Concerning Our U.S. Privacy Policy (unaudited)

We are required by federal law to provide you with a copy of our privacy policy (“Policy”) annually.

This Policy applies to current and former individual clients of Morgan Stanley Distributors Inc., as well as current and former individual investors in Morgan Stanley mutual funds and related companies.

This Policy is not applicable to partnerships, corporations, trusts or other non-individual clients or account holders, nor is this Policy applicable to individuals who are either beneficiaries of a trust for which we serve as trustee or participants in an employee benefit plan administered or advised by us. This Policy is, however, applicable to individuals who select us to be a custodian of securities or assets in individual retirement accounts, 401(k) accounts, 529 Educational Savings Accounts, accounts subject to the Uniform Gifts to Minors Act, or similar accounts. We may amend this Policy at any time, and will inform you of any changes to this Policy as required by law.

We Respect Your Privacy

We appreciate that you have provided us with your personal financial information and understand your concerns about safeguarding such information. We strive to maintain the privacy of such information while we help you achieve your financial objectives. This Policy describes what nonpublic personal information we collect about you, how we collect it, when we may share it with others, and how others may use it. It discusses the steps you may take to limit our sharing of information about you with affiliated Morgan Stanley companies (“affiliated companies”). It also discloses how you may limit our affiliates’ use of shared information for marketing purposes. Throughout this Policy, we refer to the nonpublic information that personally identifies you or your accounts as “personal information.”

1.  What Personal Information Do We Collect About You?

To better serve you and manage our business, it is important that we collect and maintain accurate information about you. We obtain this information from applications and other forms you submit to us, from your dealings with us, from consumer reporting agencies, from our websites and from third parties and other sources.

For example:

•  We collect information such as your name, address, e-mail address, telephone/fax numbers, assets, income and investment objectives through application forms you submit to us.

•  We may obtain information about account balances, your use of account(s) and the types of products and services you prefer to receive from us through your dealings and transactions with us and other sources.

•  We may obtain information about your creditworthiness and credit history from consumer reporting agencies.

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An Important Notice Concerning Our U.S. Privacy Policy (unaudited) continued

•  We may collect background information from and through third-party vendors to verify representations you have made and to comply with various regulatory requirements.

•  If you interact with us through our public and private Web sites, we may collect information that you provide directly through online communications (such as an e-mail address). We may also collect information about your Internet service provider, your domain name, your computer’s operating system and Web browser, your use of our Web sites and your product and service preferences, through the use of ”cookies.” ”Cookies” recognize your computer each time you return to one of our sites, and help to improve our sites’ content and personalize your experience on our sites by, for example, suggesting offerings that may interest you. Please consult the Terms of Use of these sites for more details on our use of cookies.

2.  When Do We Disclose Personal Information We Collect About You?

To provide you with the products and services you request, to better serve you, to manage our business and as otherwise required or permitted by law, we may disclose personal information we collect about you to other affiliated companies and to nonaffiliated third parties.

a. Information We Disclose to Our Affiliated Companies.  In order to manage your account(s) effectively, including servicing and processing your transactions, to let you know about products and services offered by us and affiliated companies, to manage our business, and as otherwise required or permitted by law, we may disclose personal information about you to other affiliated companies. Offers for products and services from affiliated companies are developed under conditions designed to safeguard your personal information.

b. Information We Disclose to Third Parties.  We do not disclose personal information that we collect about you to nonaffiliated third parties except to enable them to provide marketing services on our behalf, to perform joint marketing agreements with other financial institutions, and as otherwise required or permitted by law. For example, some instances where we may disclose information about you to third parties include: for servicing and processing transactions, to offer our own products and services, to protect against fraud, for institutional risk control, to respond to judicial process or to perform services on our behalf. When we share personal information with a nonaffiliated third party, they are required to limit their use of personal information about you to the particular purpose for which it was shared and they are not allowed to share personal information about you with others except to fulfill that limited purpose or as may be required by law.

3.  How Do We Protect The Security and Confidentiality Of Personal Information We Collect About You?

We maintain physical, electronic and procedural security measures to help safeguard the personal information we collect about you. We have internal policies governing the proper handling of client information. Third parties that provide support or marketing services on our behalf may also receive personal information about you, and we require them to adhere to confidentiality standards with respect to such information.

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An Important Notice Concerning Our U.S. Privacy Policy (unaudited) continued

4.  How Can You Limit Our Sharing Of Certain Personal Information About You With Our Affiliated Companies For Eligibility Determination?

We respect your privacy and offer you choices as to whether we share with our affiliated companies personal information that was collected to determine your eligibility for products and services such as credit reports and other information that you have provided to us or that we may obtain from third parties (“eligibility information”). Please note that, even if you direct us not to share certain eligibility information with our affiliated companies, we may still share your personal information, including eligibility information, with those companies under circumstances that are permitted under applicable law, such as to process transactions or to service your account. We may also share certain other types of personal information with affiliated companies – such as your name, address, telephone number, e-mail address and account number(s), and information about your transactions and experiences with us.

5.  How Can You Limit The Use Of Certain Personal Information About You By Our Affiliated Companies For Marketing?

You may limit our affiliated companies from using certain personal information about you that we may share with them for marketing their products or services to you. This information includes our transactions and other experiences with you such as your assets and account history. Please note that, even if you choose to limit our affiliated companies from using certain personal information about you that we may share with them for marketing their products and services to you, we may still share such personal information about you with them, including our transactions and experiences with you, for other purposes as permitted under applicable law.

6.  How Can You Send Us An Opt-Out Instruction?

If you wish to limit our sharing of certain personal information about you with our affiliated companies for “eligibility purposes” and for our affiliated companies’ use in marketing products and services to you as described in this notice, you may do so by:

•  Calling us at (800) 869-6397
Monday-Friday between 8 a.m. and 6 p.m. (EST)

•  Writing to us at the following address:
Morgan Stanley Privacy Department
Harborside Financial Center
201 Plaza Two, 3rd Floor
Jersey City, NJ 07311

If you choose to write to us, your written request should include: your name, address, telephone number and account number(s) to which the opt-out applies and should not be sent with any other correspondence. In order to process your request, we require that the request be provided by you directly and not through a third party. Once you have informed us about your privacy preferences, your opt-out preference will remain in

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An Important Notice Concerning Our U.S. Privacy Policy (unaudited) continued

effect with respect to this Policy (as it may be amended) until you notify us otherwise. If you are a joint account owner, we will accept instructions from any one of you and apply those instructions to the entire account. Please allow approximately 30 days from our receipt of your opt-out for your instructions to become effective.

Please understand that if you opt-out, you and any joint account holders may not receive certain Morgan Stanley or our affiliated companies’ products and services that could help you manage your financial resources and achieve your investment objectives.

If you have more than one account with us or our affiliates, you may receive multiple privacy policies from us, and would need to follow the directions stated in each particular policy for each account you have with us.

7.  What If An Affiliated Company Becomes A Nonaffiliated Third Party?

If, at any time in the future, an affiliated company becomes a nonaffiliated third party, further disclosures of personal information made to the former affiliated company will be limited to those described in Section 2(b) above relating to nonaffiliated third parties. If you elected under Section 6 to limit disclosures we make to affiliated companies, or use of personal information by affiliated companies, your election will not apply to use by any former affiliated company of your personal information in their possession once it becomes a nonaffiliated third party.

Special Notice To Residents Of Vermont

This section supplements our Policy with respect to our individual clients who have a Vermont address and supersedes anything to the contrary in the above Policy with respect to those clients only.

The State of Vermont requires financial institutions to obtain your consent prior to sharing personal information that they collect about you with affiliated companies and nonaffiliated third parties other than in certain limited circumstances. Except as permitted by law, we will not share personal information we collect about you with nonaffiliated third parties or other affiliated companies unless you provide us with your written consent to share such information (“opt-in”).

If you wish to receive offers for investment products and services offered by or through other affiliated companies, please notify us in writing at the following address:

Morgan Stanley Privacy Department
Harborside Financial Center
201 Plaza Two, 3rd Floor
Jersey City, NJ 07311

74

Morgan Stanley Global Strategist Fund

An Important Notice Concerning Our U.S. Privacy Policy (unaudited) continued

Your authorization should include: your name, address, telephone number and account number(s) to which the opt-in applies and should not be sent with any other correspondence. In order to process your authorization, we require that the authorization be provided by you directly and not through a third-party.

Special Notice To Residents Of California

The following section supplements our Policy with respect to our individual clients who have a California address and supersedes anything to the contrary in the above Policy with respect to those clients only.

In response to a California law, if your account has a California home address, your personal information will not be disclosed to nonaffiliated third parties except as permitted by applicable California law, and we will limit sharing such personal information with our affiliates to comply with California privacy laws that apply to us.

75

Trustees

Frank L. Bowman

Michael Bozic

Kathleen A. Dennis

James F. Higgins

Dr. Manuel H. Johnson

Joseph J. Kearns

Michael F. Klein

Michael E. Nugent

W. Allen Reed

Fergus Reid

Officers

Michael E. Nugent

Chairperson of the Board

Sara Furber

President and Principal Executive Officer

Mary Ann Picciotto

Chief Compliance Officer

Stefanie V. Chang Yu

Vice President

Francis J. Smith

Treasurer and Principal Financial Officer

Mary E. Mullin

Secretary

Transfer Agent

Morgan Stanley Services Company Inc.

P.O. Box 219886

Kansas City, Missouri 64121-9886

Custodian

State Street Bank and Trust Co.

One Lincoln Street

Boston, Massachusetts 02111

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

Two World Financial Center

New York, New York 10281

Legal Counsel

Dechert LLP

1095 Avenue of the Americas

New York, New York 10036

Counsel to the Independent Trustees

Kramer Levin Naftalis & Frankel LLP

1177 Avenue of the Americas

New York, New York 10036

Investment Adviser

Morgan Stanley Investment Advisors Inc.

522 Fifth Avenue

New York, New York 10036

The financial statements included herein have been taken from the records of the Fund without examination by the independent auditors and accordingly they do not express an opinion thereon.

This report is submitted for the general information of the shareholders of the Fund. For more detailed information about the Fund, its fees and expenses and other pertinent information, please read its Prospectus. The Fund’s Statement of Additional Information contains additional information about the Fund, including its trustees. It is available, without charge, by calling (800) 869-NEWS.

This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective Prospectus. Read the Prospectus carefully before investing.

Morgan Stanley Distributors Inc., member FINRA.

(c)  2011 Morgan Stanley

INVESTMENT MANAGEMENT

Morgan Stanley

Global Strategist Fund

Semiannual
Report

January 31, 2011

SRTSAN

IU11-00576P-Y01/11

Item 2. Code of Ethics.

Not applicable for semiannual reports.

Item 3. Audit Committee Financial Expert.

Not applicable for semiannual reports.

Item 4. Principal Accountant Fees and Services

Not applicable for semiannual reports.

Item 5. Audit Committee of Listed Registrants.

Not applicable for semiannual reports.

Item 6.

(a) Refer to Item 1.

(b) Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable for semiannual reports.

Item 8. Portfolio Managers of Closed-End Management Investment Companies

Applicable only to reports filed by closed-end funds.

Item 9. Closed-End Fund Repurchases

Applicable to reports filed by closed-end funds.

Item 10. Submission of Matters to a Vote of Security Holders

Not applicable.

Item 11. Controls and Procedures

(a) The Fund’s principal executive officer and principal financial officer have concluded that the Fund’s disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Fund in this Form N-CSR was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, based upon such officers’ evaluation of these controls and procedures as of a date within 90 days of the filing date of the report.

(b) There were no changes in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Exhibits

(a) Code of Ethics — Not applicable for semiannual reports.

(b) A separate certification for each principal executive officer and principal financial officer of the registrant are attached hereto as part of EX-99.CERT.

2

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Morgan Stanley Global Strategist Fund

/s/ Sara FurberSara Furber

Principal Executive Officer

March 22, 2011

     Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Sara FurberSara Furber

Principal Executive Officer

March 22, 2011

/s/ Francis SmithFrancis Smith

Principal Financial Officer

March 22, 2011

3