SCHEDULE: Morgan Stanley Reduces Stake in First Trust Fund

Morgan Stanley and its subsidiary, Parametric Portfolio Associates LLC, have reduced their beneficial ownership in First Trust Senior Floating Rate Income Fund II to 4.1%.

Summary

• Morgan Stanley and Parametric Portfolio Associates LLC filed an Amendment No. 1 to Schedule 13G for First Trust Senior Floating Rate Income Fund II.
• The filing indicates that Morgan Stanley and Parametric Portfolio Associates LLC have ceased to be beneficial owners of more than five percent of the class of securities.
• As of the event date, the aggregate amount beneficially owned by the reporting persons is 1,061,383.00 Common Shares of Beneficial Interest.
• This aggregate amount represents 4.1% of the class of securities.
• Parametric Portfolio Associates LLC is identified as a wholly-owned subsidiary of Morgan Stanley.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this as a slightly negative signal, as a major institutional investor has reduced its stake below the 5% reporting threshold, potentially indicating a shift in investment allocation away from the fund.

Negatives

• The reduction of beneficial ownership below 5% by a significant institutional investor like Morgan Stanley and its subsidiary could be perceived as a decrease in institutional confidence or a reallocation of capital away from the fund.

Future Outlook

This filing is a compliance report regarding a change in beneficial ownership and does not contain forward-looking statements or guidance from the issuer or reporting persons regarding future performance or strategy.

Management Comments

• Chris O'Hara, Authorized Signatory for Morgan Stanley, certified that the information is true, complete, and correct to the best of their knowledge and belief.
• Cindy Kim, Authorized Signatory for Parametric Portfolio Associates LLC, certified that the information is true, complete, and correct to the best of their knowledge and belief.

Industry Context

StockSavvy.ai notes that institutional investors frequently adjust their positions in publicly traded funds and companies based on various factors, including portfolio rebalancing, changes in investment strategy, or market conditions. A reduction below a reporting threshold like 5% is a common event that triggers a Schedule 13G amendment.

Related Party Transactions

• Parametric Portfolio Associates LLC, a reporting person, is a wholly-owned subsidiary of Morgan Stanley, the other reporting person. Their beneficial ownership is reported jointly.

Stakeholder Impact

• Shareholders of First Trust Senior Floating Rate Income Fund II may note the reduced institutional ownership by Morgan Stanley and its subsidiary, which could influence market perception of the fund.

Key Dates

Keywords

Morgan Stanley, Parametric Portfolio Associates, First Trust Senior Floating Rate Income Fund II, Schedule 13G, Beneficial Ownership, Institutional Investor, Stake Reduction, Closed-End Fund