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SEATTLE - May 12, 2026

Parametric Portfolio Associates LLC (Parametric), part of Morgan Stanley Investment Management (MSIM), today announced its Tax Optimized Ladder Strategy has surpassed $3 billion in assets since its debut in March 2024. The distinctive strategy systematically identifies attractive after-tax fixed income opportunities across municipal, corporate and U.S. Treasury markets and uniquely combines all three into a single customized portfolio with the objective of maximizing after-tax yield on a risk-adjusted basis that is also tailored to each client’s individual federal and state tax rate.

“An extreme focus on tax management and after-tax outcomes is a key priority for advisors and their clients who are increasingly seeking customized solutions,” said Brian Smith, Head of the Wealth Education Center, Morgan Stanley Investment Management. “Crossing $3 billion in assets in two years illustrates just how strongly the strategy resonates with advisors and investors. It’s increasingly recognized and appreciated as one of the most differentiated solutions in the fixed income marketplace.”

Parametric’s Tax Optimized Ladder Strategy seeks to purchase bonds with the highest after-tax yield across in-state and out-of-state municipal bonds, investment-grade corporate bonds and U.S. Treasurys, dynamically adjusting sector exposure over time based on relative value and the client’s tax profile. Portfolios are typically laddered across one to 10 years, evenly weighted by maturity, providing predictable, rules-based exposure and income. The strategy builds on Parametric’s longstanding leadership in fixed income separately managed accounts (SMAs).

Jon Rocafort, Head of Fixed Income Solutions at Parametric, emphasizes the importance of considering each investor’s specific tax circumstances to develop an optimal investment approach. “Parametric’s Tax Optimized Ladder Strategy is designed for fixed income investors seeking to move beyond single-sector portfolios and unmanaged brokerage accounts, particularly those where the optimal mix of taxable and tax-exempt bonds may differ materially based on evolving tax rates, state of residence, income levels and market conditions.”

Notably, improving tax management capabilities is now the top priority for managed account sponsors according to a research study authored by Cerulli Associates, Customized at Scale: A Framework for Next-Generation Advisory Platforms. The study also found that clients increasingly focus on net buying power—the after-tax outcome—rather than headline returns.

Key features of Tax Optimized Ladders include:

  • Personalized tax optimization that elevates the client’s federal and state tax rate as a core input in portfolio construction
  • Systematic, year-round tax-loss harvesting, offered as an opt-in feature and designed to help justify management fees through tangible tax savings
  • Advanced proprietary technology leveraging Radius, which enables customization and tax optimization at scale
  • Institutional trading and credit oversight, supported by Parametric’s municipal and investment-grade corporate credit research team

 

About Parametric

Parametric partners with advisors, institutions, and consultants to build innovative portfolio solutions focused on achieving their long-term financial objectives. A leader in custom solutions for more than 30 years, Parametric helps investors efficiently access market exposure, solve implementation challenges, and design multi-asset portfolios that respond to evolving needs. Parametric also offers systematic alpha strategies to complement clients’ core holdings. Parametric is part of Morgan Stanley Investment Management, the asset management division of Morgan Stanley. Learn more at parametricportfolio.com.

About Morgan Stanley Investment Management 

Morgan Stanley Investment Management, together with its investment advisory affiliates, has more than 1,300 investment professionals around the world and $1.9 trillion in assets under management or supervision as of March 31, 2026. Morgan Stanley Investment Management strives to provide outstanding long-term investment performance, service, and a comprehensive suite of investment management solutions to a diverse client base, which includes governments, institutions, corporations and individuals worldwide. For further information about Morgan Stanley Investment Management, please visit www.morganstanley.com/im.    

About Morgan Stanley    

Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, wealth management and investment management services. With offices in 42 countries, the Firm's employees serve clients worldwide including corporations, governments, institutions and individuals. For more information about Morgan Stanley, please visit www.morganstanley.com.