Morgan Stanley Slips 1.34% as $720M Volume Ranks 147th in U.S. Liquidity

On October 7, 2025, Morgan Stanley (MS) closed at 1.34% below its previous day's level with $720 million in trading volume, placing it 147th among U.S. equities by liquidity. The decline occurred amid mixed market conditions and sector-specific pressures affecting financial services firms.

Recent regulatory scrutiny over risk management practices at major banks has heightened investor caution, contributing to broader weakness in the sector. Analyst commentary highlighted evolving capital allocation strategies as a key factor influencing short-term sentiment. While no direct earnings or earnings guidance revisions were reported for Morgan Stanley, broader macroeconomic indicators including inflation expectations and interest rate forecasts continue to shape market positioning.

To run this back-test robustly I need to pin down a few details: Market universe • Should the "top 500 stocks" be selected from all U.S. listed equities (NYSE + NASDAQ + AMEX), or another market? Re-selection & weighting • Do we re-rank and rebuild the portfolio every trading day (i.e., at each day’s close, buy the 500 highest-volume stocks of that day and liquidate the previous day’s picks)? • Equal-weight each position (1/500 per stock), or use another sizing rule? Price used for entry/exit • Enter at the next day’s open and exit at that day’s close (typical intraday hold), or simply use daily closes (buy today’s close, sell tomorrow’s close)? Costs & risk controls • Any commission/slippage assumptions, or ignore trading costs? • Any stop-loss / take-profit rules, or purely a 1-day hold? Once I have these, I can generate the daily trading signals and run the back-test from 2022-01-03 through today.