Morgen Stanley’s Acquisition of Etrade: Reasons, Purposes and Prospect

Research Article
Open access

Morgen Stanley’s Acquisition of Etrade: Reasons, Purposes and Prospect

Dingning Yang 1*
  • 1 Shenyang Aerospace University    
  • *corresponding author yangdingning@stu.sau.edu.cn
Published on 10 November 2023 | https://doi.org/10.54254/2754-1169/38/20231916
AEMPS Vol.38
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-83558-097-4
ISBN (Online): 978-1-83558-098-1

Abstract

Morgan Stanley, the head of investment banking, announced a full-stock acquisition of Etrade on February 20, 2020. This paper intuitively presents the comparison of earnings before and after the acquisition by collecting the relevant data of the acquisition and using Excel to organize the analysis, to carry out a multi-level analysis of the acquisition. The research mainly includes the reasons for Morgan Stanley's business transformation as a top investment bank, acquisition objectives and acquisition future. The main findings of this article are as follows: Morgan Stanley's acquisition of Etrade continues its efforts to deepen the wealth management business since 2010 and pay attention to building a technology platform to assist the digital transformation of the wealth management business, bringing significant and sustainable growth in the net income of the wealth management business. This acquisition looks at the development opportunity of digital retail brokerages, conforms to the trend of industry integration, builds digital banks, expands customer groups, and jointly creates huge synergies. The significance of this paper lies in the complete analysis of the beginning and end of the second high-value transaction on Wall Street after the financial crisis from a long-term perspective, providing a reference for financial enthusiasts to understand the case. Through the study of this article, the advice given to investors is that from the perspective of fundamental analysis, Morgan Stanley's profit is growing steadily, and the relevant business needs of investing in its stocks or choosing the investment bank for personal asset management can be considered.

Keywords:

wealth management, acquisition, digitization

Yang,D. (2023). Morgen Stanley’s Acquisition of Etrade: Reasons, Purposes and Prospect. Advances in Economics, Management and Political Sciences,38,215-224.
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References

[1]. American Hong Kong stock economy AL. (2011). E*Trade-An online brokerage that started out by tranding U.S. stock online. https://m.douban.com/note/189372929/

[2]. Morgan Stanley New York. (2020) Morgan Stanley Closes Acquisition of E*trade. https://www.morganstanley.com/press-releases/morgan-stanley-closes-acquisition-of-e-trade

[3]. Morgan Stanley. (2020). Morgan Stanley is byuying E*TRADE to create a leader in omnichannel wealth management. https://www.morganstanleychina.com/press-releases/200220_press.pdf

[4]. Laura Noonan New York. (2020) Morgan Stanley agrees$13bn deal to buy ETrade. https://www.ft.com/content/600b1100-53df-11ea-8841-482eed0038b1

[5]. M. Jane. (2020). Will Morgan Stanley’s E-trade Move Pay off? The Banker; London,66. https://www.proquest.com/docview/2392198051?parentSessionId=sKxWrg4DI4DCNenYICdXgnbrIGlNRfk0HSWV3wYKyiQ%3D&pq-origsite=primo&accountid=14511

[6]. Morgan Stanley RESEARCH. (2018). 2019 Global Outlook: Turning Point Ahead.https://www.morganstanley.com/ideas/2019-global-macroeconomic-outlook

[7]. IMF. (2019) World Economic Outlook, October 2019 Global Manufacturing Downturn,Rising Trade Barriers. https://www.imf.org/en/Publications/WEO/Issues/2019/10/01/world-economic-outlook-october-2019

[8]. Morgan Stanley New York. (2021) Morgan Stanley announces fourth quarter and full year 2020 results. https://www.morganstanleychina.com/earnings/2020q4-release-zh.pdf

[9]. Morgan Stanley RESEARCH. (2019) 2020 Global Macro Outlook: Calmer Waters Ahead. https://www.morganstanley.com/ideas/global-economic-outlook-2020

[10]. Adam Hayes. (2023) Dodd-Frank Act: What It Does, Major Components,Criticisms. https://www.investopedia.com/terms/d/dodd-frank-financial-regulatory-reform-bill.asp

[11]. Maggie Fitzgerald USA. (2020) Morgan Stanley to buy E-Trade for $13 billion in latest deal for online brokerage industry. https://www.cnbc.com/amp/2020/02/20/morgan-stanley-reportedly-to-buy-e-trade-for-13-billion.html

[12]. Thomas Health, Rachel Siegel. The Washington Post. (2019). Charles Schwab will acquire TD Ameritrade, creating wealth management Goliath with $5 trillion in assets. https://go.gale.com/ps/i.do?id=GALE%7CA606705858&sid=googleScholar&v=2.1&it=r&linkaccess=abs&issn=01908286&p=AONE&sw=w&userGroupName=anon%7E93240256&aty=open+web+entry

[13]. Morgan Stanley. (2020) Morgan Stanley to Acquire E-TRADE, Creating a Leader in all Major Wealth Management Channels. https://www.morganstanley.com/press-releases/morgan-stanley-to-acquire-e-trade

[14]. Morgan Stanley US. (2012) Morgan Stanley Smith Barney is Now Morgan Stanley Wealth Management. https://www.morganstanley.com/press-releases/morgan-stanley-smith-barney-is-now-morgan-stanley-wealth-management_7a78aa1d-036a-4fbf-9df7-1e73387a1c8a

Cite this article

Yang,D. (2023). Morgen Stanley’s Acquisition of Etrade: Reasons, Purposes and Prospect. Advances in Economics, Management and Political Sciences,38,215-224.

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About volume

Volume title: Proceedings of the 7th International Conference on Economic Management and Green Development

ISBN：978-1-83558-097-4(Print) / 978-1-83558-098-1(Online)
Editor：Canh Thien Dang
Conference website: https://www.icemgd.org/
Conference date: 6 August 2023
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.38
ISSN：2754-1169(Print) / 2754-1177(Online)

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References

[1]. American Hong Kong stock economy AL. (2011). E*Trade-An online brokerage that started out by tranding U.S. stock online. https://m.douban.com/note/189372929/

[2]. Morgan Stanley New York. (2020) Morgan Stanley Closes Acquisition of E*trade. https://www.morganstanley.com/press-releases/morgan-stanley-closes-acquisition-of-e-trade

[3]. Morgan Stanley. (2020). Morgan Stanley is byuying E*TRADE to create a leader in omnichannel wealth management. https://www.morganstanleychina.com/press-releases/200220_press.pdf

[4]. Laura Noonan New York. (2020) Morgan Stanley agrees$13bn deal to buy ETrade. https://www.ft.com/content/600b1100-53df-11ea-8841-482eed0038b1

[5]. M. Jane. (2020). Will Morgan Stanley’s E-trade Move Pay off? The Banker; London,66. https://www.proquest.com/docview/2392198051?parentSessionId=sKxWrg4DI4DCNenYICdXgnbrIGlNRfk0HSWV3wYKyiQ%3D&pq-origsite=primo&accountid=14511

[6]. Morgan Stanley RESEARCH. (2018). 2019 Global Outlook: Turning Point Ahead.https://www.morganstanley.com/ideas/2019-global-macroeconomic-outlook

[7]. IMF. (2019) World Economic Outlook, October 2019 Global Manufacturing Downturn,Rising Trade Barriers. https://www.imf.org/en/Publications/WEO/Issues/2019/10/01/world-economic-outlook-october-2019

[8]. Morgan Stanley New York. (2021) Morgan Stanley announces fourth quarter and full year 2020 results. https://www.morganstanleychina.com/earnings/2020q4-release-zh.pdf

[9]. Morgan Stanley RESEARCH. (2019) 2020 Global Macro Outlook: Calmer Waters Ahead. https://www.morganstanley.com/ideas/global-economic-outlook-2020

[10]. Adam Hayes. (2023) Dodd-Frank Act: What It Does, Major Components,Criticisms. https://www.investopedia.com/terms/d/dodd-frank-financial-regulatory-reform-bill.asp

[11]. Maggie Fitzgerald USA. (2020) Morgan Stanley to buy E-Trade for $13 billion in latest deal for online brokerage industry. https://www.cnbc.com/amp/2020/02/20/morgan-stanley-reportedly-to-buy-e-trade-for-13-billion.html

[12]. Thomas Health, Rachel Siegel. The Washington Post. (2019). Charles Schwab will acquire TD Ameritrade, creating wealth management Goliath with $5 trillion in assets. https://go.gale.com/ps/i.do?id=GALE%7CA606705858&sid=googleScholar&v=2.1&it=r&linkaccess=abs&issn=01908286&p=AONE&sw=w&userGroupName=anon%7E93240256&aty=open+web+entry

[13]. Morgan Stanley. (2020) Morgan Stanley to Acquire E-TRADE, Creating a Leader in all Major Wealth Management Channels. https://www.morganstanley.com/press-releases/morgan-stanley-to-acquire-e-trade

[14]. Morgan Stanley US. (2012) Morgan Stanley Smith Barney is Now Morgan Stanley Wealth Management. https://www.morganstanley.com/press-releases/morgan-stanley-smith-barney-is-now-morgan-stanley-wealth-management_7a78aa1d-036a-4fbf-9df7-1e73387a1c8a

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