Morgan Stanley launches an investment index tied to sports teams

Morgan Stanley introduces a new portfolio for investors affiliated with major sports leagues.

The investment bank's asset management division announced on Thursday the launch of the so-called Parametric Custom Core Sports League strategy. The portfolio is aimed at high-net-worth sports fans and allows them to invest in a curated index of companies with strong sponsorship, media and advertising relationships with the major sports leagues.

A minimum investment of $250,000 is required to participate.

Sports have proven to be an attractive and growing asset class as valuations have skyrocketed over the last decade. This has made those still on the sidelines want to get involved. But for most Americans, owning a professional sports team is financially out of reach. Morgan Stanley hopes to change that.

The idea for the new offering came when a Morgan Stanley client asked the bank to design a portfolio of companies that support a specific sport.

“We saw that there was a greater opportunity to do something here,” said Sandra Richards, managing director and head of Morgan Stanley’s global sports and entertainment division. “This one person represents many, multiples of many, who want to invest in the sport as a fan who wants to get involved.”

The portfolio's holdings are selected from large-cap U.S. stocks and consist of between 250 and 400 securities from companies you might see on the sidelines, on the tickers, or among advertisers at major sporting events.

According to Morgan Stanley, the portfolio will mimic the risk characteristics of the portfolio S&P 500.

The bank, which manages $516 billion in assets, will use Nielsen Sports as a data source to track the activity, spending and visibility of companies with exposure to professional sports leagues.

“We are seeing demand from our customers asking about opportunities to invest in sports,” Richards said. “And it will continue.”