Investing genius Jeffrey Ubben and his team at ValueAct Capital Management L.P. were in the news on Monday with a report (form 13F) that fund or funds affiliated with the company had taken a roughly 2% stake in Wall Street giant and James Gorman-led financial services powerhouse Morgan Stanley.
What seemed to take many on the Street by surprise was that ValueAct was not seeking a seat on Morgan Stanley’s Board nor did it seek to criticize the actions of C.E.O Gorman. On the contrary, it would appear ValueAct thinks Gorman is running the firm quite well, and believes investors are not giving the company the credit it deserves.
In particular, ValueAct highlighted Morgan Stanley’s shift to asset-light and relatively lower risk businesses like wealth and investment management and investment banking advisory, which now account for about 80% of company profits.
Time will tell if this “passive” approach will pay off.