UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549

	FORM 10-Q

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2007 or

[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from               to__________________

Commission File Number 0-15442

	MORGAN STANLEY CORNERSTONE FUND IV L.P.

	(Exact name of registrant as specified in its charter)

		New York						      13-3393597
(State or other jurisdiction of		   		  (I.R.S. Employer
incorporation or organization)			       Identification No.)

Demeter Management Corporation
522 Fifth Avenue, 13th Floor
New York, NY		    					  	   10036
(Address of principal executive offices)	  	      (Zip Code)

Registrant?s telephone number, including area code    (212) 296-1999





(Former name, former address, and former fiscal year, if changed since
last report)


Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

Yes    X       	No___________

Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, or a non-accelerated filer.  See definition
of ?accelerated filer and large accelerated filer? in Rule 12b-2 of the
Exchange Act.  (Check one):

Large accelerated filer___Accelerated filer____Non-accelerated filer X

Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act).  Yes___  No X


	<page> <table> MORGAN STANLEY CORNERSTONE FUND IV L.P.

	INDEX TO QUARTERLY REPORT ON FORM 10-Q

	September 30, 2007

<caption>


PART I. FINANCIAL INFORMATION

				<c>
Item 1. Financial Statements

		Statements of Financial Condition as of September 30, 2007
		(Unaudited) and December 31, 2006	2

		Statements of Operations for the Three and Nine Months
		Ended September 30, 2007 and 2006 (Unaudited)	3

		Statements of Changes in Partners? Capital for the Nine
		Months Ended September 30, 2007 and 2006 (Unaudited)	4

		Statements of Cash Flows for the Nine Months Ended
		September 30, 2007 and 2006 (Unaudited)	5

		Schedules of Investments as of September 30, 2007
		(Unaudited) and December 31, 2006	.6

		Notes to Financial Statements (Unaudited)	7-13

Item 2.	Management?s Discussion and Analysis of
			Financial Condition and Results of Operations	14-27

Item 3.	Quantitative and Qualitative Disclosures about
			Market Risk	27-37

Item 4.	Controls and Procedures	37

Item 4T.	Controls and Procedures	..37


PART II. OTHER INFORMATION

Item 1A.Risk Factors 	38

Item 6.	Exhibits 	38
</table>


<page> <table> PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

	MORGAN STANLEY CORNERSTONE FUND IV L.P.
	STATEMENTS OF FINANCIAL CONDITION
<caption>
	September 30,	     December 31,
	       2007      	    2006
	$	$
	(Unaudited)
ASSETS

	<c>	<c>
Equity in futures interests trading accounts:
	Unrestricted cash	     35,998,980	    50,007,010
	Restricted cash	         ?         		        ?

	     Total cash	35,998,980	 50,007,010

	Net unrealized gain on open contracts  (MS&Co.)   	      1,060,741       	     1,429,548

		Total Trading Equity    	37,059,721      	 51,436,558

Due from MS&Co.	         107,762	           49,185
Interest receivable (MS&Co.)	            97,470	          159,151

	     Total Assets	    37,264,953             	       51,644,894

LIABILITIES AND PARTNERS? CAPITAL

Liabilities

Redemptions payable	596,771	1,326,233
Accrued management fees	108,423	150,311
Accrued administrative expenses	         91,467	         109,708

	     Total Liabilities	       796,661	      1,586,252

Partners? Capital

Limited Partners (7,428.036 and
   8,793.380 Units, respectively)	35,962,462	 49,470,851
General Partner (104.479 Units)	        505,830	        587,791

	     Total Partners? Capital	   36,468,292	   50,058,642

	     Total Liabilities and Partners? Capital	   37,264,953  	     51,644,894

NET ASSET VALUE PER UNIT	       4,841.45	       5,625.92
<fn>

The accompanying notes are an integral part
	of these financial statements.
</table>
<page> <table> 	MORGAN STANLEY CORNERSTONE FUND IV L.P.
	STATEMENTS OF OPERATIONS
(Unaudited)
<caption>
                          For the Three Months	                     For the Nine Months
  	                  Ended September 30,     	      Ended September 30,

                              2007   	        2006    	      2007   	    2006
                                 $                       $	         $ 	 $

	                                   <c>	                <c>			<c>		<c>
INVESTMENT INCOME
	Interest income (MS&Co.)          	        353,389	       	   503,156 	       1,225,292	    	       1,556,166


EXPENSES
	Brokerage commissions (MS&Co.)	434,175      	   470,791	      1,195,948		1,534,990
	Management fees	                                                     341,026	  446,715       	   1,152,094		1,458,693
	Common administrative expenses	       42,000    	            47,000   	       129,000 		       128,000

		   Total Expenses 	             817,201	              964,506	   2,477,042	        	    3,121,683

NET INVESTMENT LOSS 	                         (463,812)	     (461,350)	   (1,251,750)		   (1,565,517)


TRADING RESULTS
Trading profit (loss):
	Realized	                                                      (5,776,864)	   (73,441) 	(4,805,215)		(3,000,329)
	Net change in unrealized	                        43,734	          149,432	      (368,807)	   	      (1,847,101)

		  Total Trading Results	   (5,733,130)  	            75,991	   (5,174,022)		   (4,847,430)


NET LOSS	                               (6,196,942) 	        (385,359)	   (6,425,772)		   (6,412,947)


NET LOSS ALLOCATION

	Limited Partners	(6,115,536)     	      (381,314)	(6,343,811)	  	(6,345,911)
	General Partner 	(81,406)	               (4,045)	(81,961)		(67,036)


NET LOSS PER UNIT

	Limited Partners                       	(779.16)	               (38.71)    	   (784.47) 	(600.80)
	General Partner                 	(779.16)	               (38.71)    	   (784.47)  	(600.80)


                     Units                Units                 Units                Units
WEIGHTED AVERAGE NUMBER
	OF UNITS OUTSTANDING                                    7,761.467          9,619.967            8,215.508        10,152.987
<fn>
	The accompanying notes are an integral part
	of these financial statements.
</table>
<page> <table> MORGAN STANLEY CORNERSTONE FUND IV L.P.
	STATEMENTS OF CHANGES IN PARTNERS? CAPITAL
	For the Nine Months Ended September 30, 2007 and 2006
	(Unaudited)

<caption>



	 Units of
	   Partnership	Limited	  General
	   Interest   	Partners	   Partner  	     Total
		$	$	$

	<c>	<c>	<c>	<c>
Partners? Capital,
   December 31, 2005	11,018.471	 64,109,338	  679,014	64,788,352

Net Loss                                                                   ? 	  	(6,345,911)	(67,036)	(6,412,947)

Redemptions                                               (1,597.107)        (8,577,913)	            (60,415)    (8,638,328)

Partners? Capital,
   September 30, 2006	                                    9,421.364	   49,185,514	      551,563	     49,737,077





Partners? Capital,
   December 31, 2006	 8,897.859	 49,470,851	  587,791	50,058,642

Net Loss                                                                   ? 	  	(6,343,811)	(81,961)	(6,425,772)

Redemptions                  (1,365.344)        (7,164,578)	                   ?        (7,164,578)

Partners? Capital,
   September 30, 2007	                                    7,532.515	   35,962,462	     505,830	    36,468,292






<fn>




The accompanying notes are an integral part
	of these financial statements.
</table>
<page> <table> 	MORGAN STANLEY CORNERSTONE FUND IV L.P.
	STATEMENTS OF CASH FLOWS
(Unaudited)


<caption>
	    For the Nine Months Ended September 30,

	      2007     	      2006
	      $	      $


CASH FLOWS FROM OPERATING ACTIVITIES

			<c>	<c>
Net loss 	(6,425,772)	(6,412,947)
Noncash item included in net loss:
       Net change in unrealized                                                    	   368,807	1,847,101

(Increase) decrease in operating assets:
       Due from MS&Co.	(58,577)	(60,600)
       Interest receivable (MS&Co.)	61,681	7,695

Decrease in operating liabilities:
       Accrued management fees 	           (41,888)    	          (45,833)
       Accrued administrative expenses	       (18,241)	       (21,362)

Net cash used for operating activities	  (6,113,990)	   (4,685,946)


CASH FLOWS FROM FINANCING ACTIVITIES

Cash paid for redemptions of Units	   (7,894,040)	   (9,255,064)

Net cash used for financing activities	   (7,894,040)	   (9,255,064)

Net decrease in unrestricted cash	   (14,008,030)	(13,941,010)

Unrestricted cash at beginning of period	   50,007,010	   64,125,073

Unrestricted cash at end of period	   35,998,980	  50,184,063




<fn>



	The accompanying notes are an integral part
	of these financial statements.

</table>


<page> <table> MORGAN STANLEY CORNERSTONE FUND IV L.P.
SCHEDULES OF INVESTMENTS
September 30, 2007 (Unaudited) and December 31, 2006


				<caption>


Futures and Forward Contracts
Long
Unrealized
Gain/(Loss)

Percentage of
   Net Assets
    Short
Unrealized
Gain/(Loss)

Percentage of
  Net Assets
      Net
Unrealized
Gain/(Loss)

$
%
$
%
$

September 30, 2007, Partnership Net Assets:  $36,468,292





<c>
<c>
<c>
<c>
<c>
Foreign currency
  1,465,995
        4.02
 (405,254)
      (1.11)
 1,060,741






     Grand Total:
  1,465,995
        4.02
 (405,254)
      (1.11)
 1,060,741

     Unrealized Currency Gain/(Loss)





         ?

     Total Net Unrealized Gain per Statement of Financial Condition



 1,060,741

December 31,  2006, Partnership Net Assets:  $50,058,642









Foreign currency
    603,922
        1.21
    825,626
       1.65
 1,429,548






     Grand Total:
    603,922
        1.21
    825,626
       1.65
 1,429,548

     Unrealized Currency Gain/(Loss)





         ?

     Total Net Unrealized Gain per Statement of Financial Condition



 1,429,548




<fn>





The accompanying notes are an integral part
of these financial statements.




</table>



<page> MORGAN STANLEY CORNERSTONE FUND IV L.P.
NOTES TO FINANCIAL STATEMENTS

September 30, 2007

(Unaudited)


The unaudited financial statements contained herein include, in
the opinion of management, all adjustments necessary for a fair
presentation of the results of operations and financial condition
of Morgan Stanley Cornerstone Fund IV L.P. (the ?Partnership?).
The financial statements and condensed notes herein should be
read in conjunction with the Partnership?s December 31, 2006,
Annual Report on Form 10-K.

1.  Organization
Morgan Stanley Cornerstone Fund IV L.P. is a New York limited
partnership organized in 1986 to engage in the speculative
trading of futures contracts, options on futures contracts, and
forward contracts on foreign currencies.  The Partnership is one
of the Morgan Stanley Cornerstone Funds, comprised of the
Partnership, Morgan Stanley Cornerstone Fund II L.P., and Morgan
Stanley Cornerstone Fund III L.P.

The Partnership?s general partner is Demeter Management
Corporation (?Demeter?). Morgan Stanley & Co. Incorporated
(?MS&Co.?) is the Partnership?s principal commodity broker-
dealer and also acts as the counterparty on all trading of

<page> MORGAN STANLEY CORNERSTONE FUND IV L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

foreign currency forward contracts.  Demeter and MS&Co. are
wholly-owned subsidiaries of Morgan Stanley. The trading
managers to the Partnership are John W. Henry & Company, Inc.
and Sunrise Capital Management, Inc. (individually, a ?Trading
Manager?, or collectively, the ?Trading Managers?).

2.  Related Party Transactions
The Partnership?s cash is on deposit with MS&Co. in futures,
forward, and options trading accounts to meet margin requirements
as needed.  Monthly, MS&Co. pays the Partnership interest income
on 80% of its average daily Net Assets at a rate equal to the
average yield on 13-week U.S. Treasury bills.  The Partnership
pays brokerage commissions to MS&Co.



3.  Financial Instruments
The Partnership trades futures contracts, options on futures
contracts, and forward contracts on foreign currencies.  Futures
and forwards represent contracts for delayed delivery of an
instrument at a specified date and price.  Risk arises from
changes in the value of these contracts and the potential
inability of counterparties to perform under the terms of the
contracts.  There are numerous factors which may significantly
influence the market value of these contracts, including interest
rate volatility.


<page> MORGAN STANLEY CORNERSTONE FUND IV L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)



The market value of exchange-traded contracts is based on the
settlement price quoted by the exchange on the day with respect
to which market value is being determined.  If an exchange-traded
contract could not have been liquidated on such day due to the
operation of daily limits or other rules of the exchange, the
settlement price shall be the settlement price on the first
subsequent day on which the contract could be liquidated.  The
market value of off-exchange-traded contracts is based on the
fair market value quoted by the counterparty.


The Partnership?s contracts are accounted for on a trade-date
basis and marked to market on a daily basis. The Partnership
accounts for its derivative investments in accordance with the
provisions of Statement of Financial Accounting Standards No.
133, ?Accounting for Derivative Instruments and Hedging
Activities? (?SFAS No. 133?).  SFAS No. 133 defines a derivative
as a financial instrument or other contract that has all three of
the following characteristics:

1)	One or more underlying notional amounts or payment
provisions;
2)	Requires no initial net investment or a smaller initial net
investment than would be required relative to changes in
market factors;
<page> MORGAN STANLEY CORNERSTONE FUND IV L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

3)	Terms require or permit net settlement.


Generally, derivatives include futures, forward, swap or options
contracts, and other financial instruments with similar
characteristics such as caps, floors, and collars.

The net unrealized gains on open contracts, reported as a
component of ?Equity in futures interests trading accounts? on the
Statements of Financial Condition, and their longest contract
maturities were as follows:

                      Net Unrealized Gains
                        on Open Contracts                Longest Maturities

                 Exchange-  Off-Exchange-             Exchange-  Off-Exchange-
Date              Traded      Traded       Total       Traded       Traded
                     $          $            $

Sep. 30, 2007	-	1,060,741	1,060,741	-	Dec. 2007
Dec. 31, 2006	-	1,429,548	1,429,548	-	Mar. 2007



The Partnership has credit risk associated with counterparty non-
performance.  As of the date of the financial statements, the
credit risk associated with the instruments in which the
Partnership trades is limited to the amounts reflected in the
Partnership?s Statements of Financial Condition.




<page> MORGAN STANLEY CORNERSTONE FUND IV L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

The Partnership also has credit risk because MS&Co. acts as the
futures commission merchant or the counterparty, with respect to
most of the Partnership?s assets. Exchange-traded futures,
exchange-traded forward, and exchange-traded futures-styled
options contracts are marked to market on a daily basis, with
variations in value settled on a daily basis.  MS&Co. as a futures
commission merchant for the Partnership?s exchange-traded futures,
exchange-traded forward, and exchange-traded futures-styled
options contracts, is required, pursuant to regulations of the
Commodity Futures Trading Commission (?CFTC?), to segregate from
its own assets, and for the sole benefit of its commodity
customers, all funds held by it with respect to exchange-traded
futures, exchange-traded forward, and exchange-traded futures-
styled options contracts, including an amount equal to the net
unrealized gains (losses) on all open exchange-traded futures,
exchange-traded forward, and exchange-traded futures-styled
options contracts.  With respect to the Partnership?s off-
exchange-traded forward currency contracts, there are no daily
settlements of variation in value, nor is there any requirement
that an amount equal to the net unrealized gains (losses) on such
contracts be segregated.  However, the Partnership is required to
meet margin requirements equal to the net unrealized loss on open


<page> MORGAN STANLEY CORNERSTONE FUND IV L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)


forward currency contracts in the Partnership accounts with the
counterparty, which is accomplished by daily maintenance of the
cash balance in a custody account held at MS&Co.  With respect to
those off-exchange-traded forward currency contracts, the
Partnership is at risk to the ability of MS&Co., the sole
counterparty on all such contracts, to perform.  The Partnership
has a netting agreement with MS&Co.  This agreement, which seeks
to reduce both the Partnership?s and MS&Co.?s exposure on off-
exchange-traded forward currency contracts, should materially
decrease the Partnership?s credit risk in the event of MS&Co.?s
bankruptcy or insolvency.



4.  New Accounting Developments
In July 2006, the Financial Accounting Standards Board (?FASB?)
issued interpretation No. 48, ?Accounting for Uncertainty in
Income Taxes ? an interpretation of FASB Statement 109? (?FIN
48?).  FIN 48 clarifies the accounting for income taxes by
prescribing the minimum recognition threshold a tax position must
meet before being recognized in the financial statements.  FIN 48
was effective for the Partnership as of January 1, 2007.  Based
on its analysis, management believes that the adoption of FIN 48
has no impact on the Partnership?s financial statements.





<page> MORGAN STANLEY CORNERSTONE FUND IV L.P.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)



In September 2006, the FASB issued SFAS No. 157, ?Fair Value
Measurements? (?SFAS No. 157?).  SFAS No. 157 defines fair value,
establishes a framework for measuring fair value, and expands
disclosures about fair value measurements.  SFAS No. 157 is
effective for the Partnership as of January 1, 2008.  The impact
to the Partnership?s financial statements, if any, is currently
being assessed.

5.  Restricted and Unrestricted Cash
As reflected on the Partnership?s Statements of Financial
Condition, restricted cash represents cash on deposit to satisfy
margin requirements for trading.  Cash that is not on deposit to
satisfy margin requirements for trading is reflected as
unrestricted cash.  The Partnership?s current trading strategy is
limited to foreign currency forward contracts traded on the
interbank market.  Since the Partnership is only required to post
cash for net unrealized losses by trading account on its interbank
foreign currency forward contracts and both trading accounts of
the Partnership at December 31, 2006, and September 30, 2007, had
net unrealized profits, there was no cash that needed to be posted
as margin and all cash was unrestricted.

<page>

CONDITION AND RESULTS OF OPERATIONS


Liquidity.  The Partnership deposits its assets with MS&Co. as its
commodity broker in separate futures, forward, and options trading
accounts established for each Trading Manager.  Such assets are
used as margin to engage in trading and may be used as margin
solely for the Partnership?s trading. The assets are held in
either non-interest bearing bank accounts or in securities and
instruments permitted by the CFTC for investment of customer
segregated or secured funds.  Since the Partnership?s sole purpose
is to trade in futures, forwards, and options, it is expected that
the Partnership will continue to own such liquid assets for margin
purposes.

The Partnership?s investment in futures, forwards, and options
may, from time to time, be illiquid.  Most U.S. futures exchanges
limit fluctuations in prices during a single day by regulations
referred to as ?daily price fluctuations limits? or ?daily
limits?.  Trades may not be executed at prices beyond the daily
limit.  If the price for a particular futures or options contract
has increased or decreased by an amount equal to the daily limit,
positions in that futures or options contract can neither be taken
nor liquidated unless traders are willing to effect trades at or
within the limit. Futures prices have occasionally moved the daily
limit for several consecutive days with little or no trading.
These market conditions could prevent the Partnership from <page>
promptly liquidating its futures or options contracts and result
in restrictions on redemptions.

There is no limitation on daily price moves in trading forward
contracts on foreign currencies.  The markets for some world
currencies have low trading volume and are illiquid, which may
prevent the Partnership from trading in potentially profitable
markets or prevent the Partnership from promptly liquidating
unfavorable positions in such markets, subjecting it to
substantial losses.  Either of these market conditions could
result in restrictions on redemptions.  For the periods covered
by this report, illiquidity has not materially affected the
Partnership?s assets.

There are no known material trends, demands, commitments,
events, or uncertainties at the present time that are reasonably
likely to result in the Partnership?s liquidity increasing or
decreasing in any material way.

Capital Resources.  The Partnership does not have, nor does it
expect to have, any capital assets.  Redemptions of units of
limited partnership interest (?Unit(s)?) in the future will affect
the amount of funds available for investments in futures,
forwards, and options in subsequent periods. It is not possible to
<page> estimate the amount, and therefore the impact, of future
outflows of Units.

There are no known material trends, favorable or unfavorable,
that would affect, nor any expected material changes to, the
Partnership?s capital resource arrangements at the present time.

Off-Balance Sheet Arrangements and Contractual Obligations.  The
Partnership does not have any off-balance sheet arrangements, nor
does it have contractual obligations or commercial commitments to
make future payments that would affect its liquidity or capital
resources.

Results of Operations
General. The Partnership?s results depend on the Trading Managers
and the ability of each Trading Manager?s trading program to take
advantage of price movements in the futures, forward, and options
markets.  The following presents a summary of the Partnership?s
operations for the three and nine month periods ended September
30, 2007, and 2006, and a general discussion of its trading
activities during each period. It is important to note, however,
that the Trading Managers trade in various markets at different
times and that prior activity in a particular market does not
mean that such market will be actively traded by the Trading
Managers or will be profitable in the future. Consequently, the
results of operations of the Partnership are difficult to discuss
<page> other than in the context of the Trading Managers? trading
activities on behalf of the Partnership during the period in
question.  Past performance is no guarantee of future results.

The Partnership?s results of operations set forth in the financial
statements on pages 2 through 13 of this report are prepared in
accordance with accounting principles generally accepted in the
United States of America, which require the use of certain
accounting policies that affect the amounts reported in these
financial statements, including the following:  The contracts the
Partnership trades are accounted for on a trade-date basis and
marked to market on a daily basis.  The difference between their
cost and market value is recorded on the Statements of Operations
as ?Net change in unrealized trading profit (loss)? for open
(unrealized) contracts, and recorded as ?Realized trading profit
(loss)? when open positions are closed out.  The sum of these
amounts constitutes the Partnership?s trading results.  The market
value of a futures contract is the settlement price on the
exchange on which that futures contract is traded on a particular
day.  The value of a foreign currency forward contract is based on
the spot rate as of the close of business.  Interest income, as
well as management fees, incentive fees, and brokerage commissions
expenses of the Partnership are recorded on an accrual basis.

Demeter believes that, based on the nature of the operations of
the Partnership, no assumptions relating to the application of
<page> critical accounting policies other than those presently
used could reasonably affect reported amounts.

For the Three and Nine Months Ended September 30, 2007
The Partnership recorded total trading results including interest
income totaling $(5,379,741) and expenses totaling $817,201,
resulting in a net loss of $6,196,942 for the three months ended
September 30, 2007.  The Partnership?s net asset value per Unit
decreased from $5,620.61 at June 30, 2007, to $4,841.45 at
September 30, 2007.

The most significant trading losses of approximately 5.3% were
experienced during July and August from short positions in the
Japanese yen versus the U.S. dollar as the value of the Japanese
yen corrected higher against most of its major rivals when
traders reduced ?carry-trade? positions.  Also pushing the value
of the Japanese yen higher were expectations that a Japanese
Ministry of Finance report would show Japan?s trade surplus
widened in June.  Additional losses of approximately 2.1% were
recorded during July and August from both short and long
positions in the South African rand versus the U.S. dollar as the
value of the South African rand moved without consistent
direction throughout a majority of the quarter.  Further losses
of approximately 1.7%, 1.5%, and 0.9%, respectively, were
incurred primarily during August from long positions in the New
Zealand dollar, Australian dollar, and British pound versus the
<page> U.S. dollar as the value of the U.S. dollar reversed
higher against most of its major rivals as extreme volatility in
the global equity markets and widening credit losses tied to U.S.
sub-prime loans resulted in substantially stronger demand for
U.S. dollar-denominated government bonds.  Elsewhere, losses of
approximately 1.4% were recorded throughout the quarter from both
short and long positions in the Swiss franc versus the U.S.
dollar as the value of the Swiss franc moved inconsistently due
to investors? uncertainty regarding the future interest rate
policy of the Swiss National Bank.  A portion of the
Partnership?s losses in the third quarter was offset by gains of
approximately 1.5%, 0.7%, and 0.7%, respectively, experienced
primarily during September from long positions in the euro,
Norwegian krone, and Swedish krona versus the U.S. dollar as the
value of the U.S. dollar declined relative to most of its major
rivals leading up to and after the U.S. Federal Reserve?s
decision to cut interest rates at its September 18 meeting.  In
addition, the value of the U.S. dollar was pulled lower amid
speculation that the U.S. Federal Reserve would continue to
reduce interest rates in the near term, while the value of the
Norwegian krone increased in tandem with rising energy prices.


The Partnership recorded total trading results including interest
income totaling $(3,948,730) and expenses totaling $2,477,042,
resulting in a net loss of $6,425,772 for the nine months ended
September 30, 2007.  The Partnership?s net asset value per Unit
<page> decreased from $5,625.92 at December 31, 2006, to
$4,841.45 at September 30, 2007.

The most significant trading losses of approximately 7.6% were
experienced throughout a majority of the year from both short and
long positions in the South African rand versus the U.S. dollar
as the value of the rand moved in a trendless pattern due to
investor uncertainty regarding the status of the South African
economy.  Meanwhile, short positions in the Swiss franc versus
the U.S. dollar incurred losses of approximately 2.0% primarily
during February, March, July, and August as the value of the
Swiss franc reversed higher against the U.S. dollar due to
accelerating fears of inflation in Switzerland.  Losses of
approximately 1.9% were recorded from short positions in the
Mexican peso versus the U.S. dollar as the value of the Mexican
peso moved higher during March and April on increased speculation
of an interest rate hike by the Bank of Mexico.  Further losses
were incurred during June, July, and August from newly
established long positions in the Mexican peso versus the U.S.
dollar as the value of the Mexican peso reversed lower leading up
to and after the Bank of Mexico?s decision to hold interest rates
steady at 7.25%.  Additional losses of approximately 1.9% were
experienced during February, March, and May from long positions
in the British pound versus the U.S. dollar as the value of the
pound weakened after a report showed U.K. services growth slowed
and amid political uncertainty in the United Kingdom after
British Prime Minister Tony Blair announced he would step down in
<page> June 2007.  During August, long positions in the British
pound versus the U.S. dollar recorded further losses as the value
of the U.S. dollar reversed higher against the British pound amid
stronger demand for U.S. dollar-denominated government bonds
resulting from extreme volatility in the global equity markets
and widening credit losses tied to U.S. sub-prime loans.  Losses
continued during September from newly established short positions
in the British pound versus the U.S. dollar as the value of the
U.S. dollar moved lower relative to the British pound leading up
to and after the U.S. Federal Reserve?s decision to cut interest
rates at its September 18 meeting.  Smaller losses of
approximately 1.1% and 0.5%, respectively, were recorded
primarily during August from long positions in the New Zealand
dollar and Indian rupee versus the U.S. dollar as the value of
the U.S. dollar reversed higher against most of its major rivals
due to the aforementioned reasons regarding U.S. sub-prime
mortgage losses.  Finally, losses of approximately 0.2% were
incurred during late February and early March from short
positions in the Japanese yen versus the U.S. dollar as the value
of the Japanese yen reversed sharply higher against the U.S.
dollar in late February due to a combination of factors including
an almost 10% drop in the Shanghai stock market and a warning
from Rodrigo Rato, Managing Director of the International
Monetary Fund, that a weak yen "could lead to more entrenched
exchange rate misalignments that worsen global imbalances"
encouraged traders to unwind short positions in the Japanese yen
<page> against most of its major rivals.  During July and August,
short positions in the Japanese yen versus the U.S. dollar
resulted in further losses as the value of the Japanese yen
corrected higher against most of its major rivals when traders
reduced ?carry-trade? positions after the sell-off in the global
equity markets resulted in investors trimming ?riskier? assets
funded by loans in Japan.  A portion of the Partnership?s losses
in the first nine months of the year was offset by gains of
approximately 2.5% recorded throughout a majority of the year
from long positions in the Brazilian real versus the U.S. dollar
as the value of the Brazilian real trended higher as consistently
strong economic data out of Brazil led to investor sentiment that
the Central Bank of Brazil would continue raising interest rates.
Elsewhere, gains of approximately 1.5% were experienced primarily
during March and April from long positions in the euro versus the
U.S. dollar as the value of the euro moved higher against the
U.S. dollar amid indications from European Central Bank member
Klaus Liebscher that interest rates in the Euro-Zone would
increase further.  During September, additional gains were
experienced from long positions in the euro versus the U.S.
dollar as the value of the U.S. dollar was pulled lower amid
speculation that the U.S. Federal Reserve would continue to
reduce interest rates in the near term.  Smaller gains of
approximately 0.6% were recorded during April, June, July, and
September from long positions in the Swedish krona versus the
<page> U.S. dollar as the value of the Swedish krona moved higher
amid consistently strong economic data out of Sweden.


For the Three and Nine Months Ended September 30, 2006
The Partnership recorded total trading results including interest
income totaling $579,147 and expenses totaling $964,506,
resulting in a net loss of $385,359 for the three months ended
September 30, 2006.  The Partnership?s net asset value per Unit
decreased from $5,317.89 at June 30, 2006, to $5,279.18 at
September 30, 2006.

The most significant trading losses of approximately 2.0% were
incurred primarily during July from long positions in the euro
versus the U.S. dollar as the value of the euro moved lower after
the European Central Bank decided to keep its key interest rate
unchanged.  Elsewhere, losses of approximately 1.3% were incurred
during July from short positions in the South African rand versus
the U.S. dollar as the value of the rand moved higher in tandem
with increasing commodity prices.  Additional losses were
incurred during August from newly established long positions in
the South African rand versus the U.S. dollar during August as
the value of the rand weakened against the U.S. dollar after the
release of data showing South Africa?s trade deficit widened more
than expected.  During September, losses of approximately 0.9%,
0.7% and 0.4%, respectively, were recorded from long positions in
the Singapore dollar, Mexican peso, and Australian dollar against
<page> the U.S. dollar as the value of the U.S. dollar increased
against these currencies after government reports showed U.S.
consumer confidence rebounded in September.  In addition, the
value of the Mexican peso declined after investors expressed
concern that a military coup in Thailand would have a ?ripple-
effect? on other emerging-market currencies.  Finally, smaller
losses of approximately 0.3%, 0.3% and 0.3%, respectively, were
recorded from both long and short positions in the U.S. dollar
relative to the Czech koruna, Polish zloty, and New Zealand
dollar as the value of these currencies moved without consistent
direction throughout a majority of the quarter.  A portion of the
Partnership?s overall losses for the quarter was offset by gains
of approximately 5.5% and 0.3%, respectively, from positions in
the U.S. dollar relative to the Japanese yen and British pound.
During August, gains were recorded from short positions in the
Japanese yen versus the U.S. dollar as the value of the yen
weakened against most of its major rivals after the Japanese
Consumer Price Index for July came in lower than expected,
diminishing expectations of another interest rate hike by the
Bank of Japan this year.  The value of the yen continued to trend
lower in September after a report showed Japanese consumer
confidence fell in August, resulting in gains from short
positions against the U.S. dollar.  During July, gains were
experienced from long positions in the British pound versus the
U.S. dollar as the value of the pound increased on solid housing
and consumer-price data out of the United Kingdom.  In addition,
<page> the value of the British pound was pressured higher during
August after the Bank of England unexpectedly lifted its key
interest rate.

The Partnership recorded total trading results including interest
income totaling $(3,291,264) and expenses totaling $3,121,683,
resulting in a net loss of $6,412,947 for the nine months ended
September 30, 2006.  The Partnership?s net asset value per Unit
decreased from $5,879.98 at December 31, 2005, to $5,279.18 at
September 30, 2006.

The most significant trading losses of approximately 4.0%, 3.6%,
and 2.4%, respectively, resulted from short positions in the
Swiss franc, Japanese yen, and Australian dollar versus the U.S.
dollar during the first six months of the year.  The Swiss franc
and Japanese yen moved higher against the U.S. dollar during
January and February as strong economic data out of Switzerland
and Japan increased speculation that the Swiss National Bank and
Bank of Japan might raise interest rates.  In addition, the
Japanese yen strengthened during April on speculation of a
possible Bank of Japan interest rate hike, while the Swiss franc
moved higher on geopolitical tensions in the Middle East.
Meanwhile, the Australian dollar also moved higher on an
unexpected interest rate hike by the Reserve Bank of Australia in
May.  Finally, the U.S. dollar moved lower during April and May
on news that foreign central banks were beginning to diversify
<page> their currency reserves away from U.S. dollar-denominated
assets, as well as amid uncertainty regarding the future of the
U.S. Federal Reserve?s interest rate tightening campaign.
Further losses of approximately 1.3% and 1.3%, respectively, were
experienced primarily during May and June from long positions in
the Brazilian real, as well as both long and short positions in
the Polish zloty, as the value of the Brazilian real moved lower
on political concerns, while the value of the Polish zloty moved
without consistent direction.  A portion of the Partnership?s
losses in the first nine months of the year was offset by gains
of approximately 1.3% and 0.7%, respectively, recorded from short
positions in the South African rand and New Zealand dollar versus
the U.S. dollar.  The South African rand weakened against the
U.S. dollar during June as the value of this ?commodity-currency?
fell in tandem with falling gold prices.  Meanwhile, the New
Zealand dollar continued to weaken against the U.S. dollar on
expectations for an economic slow-down in New Zealand.  Finally,
smaller gains of approximately 0.6% and 0.5%, respectively, were
experienced during April and May from long positions in the
Singapore dollar and euro against the U.S. dollar as the value of
the U.S. dollar moved lower on news that foreign central banks
would diversify their currency reserves away from the U.S.
dollar.  Additionally, the euro strengthened during April and May
after Dutch Finance Minister Gerritt Zalm said that the European
Central Bank would not intervene to halt the appreciation of the
<page> euro, as well as on increased expectations of an interest
rate hike in the near future by the European Central Bank.

Item 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Introduction
The Partnership is a commodity pool engaged primarily in the
speculative trading of futures, forwards, and options.  The
market-sensitive instruments held by the Partnership are acquired
for speculative trading purposes only and, as a result, all or
substantially all of the Partnership?s assets are at risk of
trading loss.  Unlike an operating company, the risk of market-
sensitive instruments is inherent to the primary business
activity of the Partnership.

The futures, forwards, and options traded by the Partnership
involve varying degrees of related market risk.  Market risk is
often dependent upon changes in the level or volatility of
interest rates, exchange rates, and prices of financial
instruments and commodities, factors that result in frequent
changes in the fair value of the Partnership?s open positions,
and consequently in its earnings, whether realized or unrealized,
and cash flow.  Gains and losses on open positions of exchange-
traded futures, exchange-traded forward, and exchange-traded
futures-styled options contracts are settled daily through
variation margin.  Gains and losses on off-exchange-traded
forward currency contracts are settled upon termination of the
<page> contract.  However, the Partnership is required to meet
margin requirements equal to the net unrealized loss on open
forward currency contracts in the Partnership accounts with the
counterparty, which is accomplished by daily maintenance of the
cash balance in a custody account held at MS&Co.

The Partnership?s total market risk may increase or decrease as
it is influenced by a wide variety of factors, including, but not
limited to, the diversification among the Partnership?s open
positions, the volatility present within the markets, and the
liquidity of the markets.

The face value of the market sector instruments held by the
Partnership is typically many times the applicable margin
requirements.  Margin requirements generally range between 2% and
15% of contract face value.  Additionally, the use of leverage
causes the face value of the market sector instruments held by
the Partnership typically to be many times the total
capitalization of the Partnership.

The Partnership?s past performance is no guarantee of its future
results.  Any attempt to numerically quantify the Partnership?s
market risk is limited by the uncertainty of its speculative
trading.  The Partnership?s speculative trading and use of
leverage may cause future losses and volatility (i.e., ?risk of
ruin?) that far exceed the Partnership?s experience to date under
<page> the ?Partnership?s Value at Risk in Different Market
Sectors? section and significantly exceed the Value at Risk
(?VaR?)  tables disclosed.

Limited partners will not be liable for losses exceeding the
current net asset value of their investment.

Quantifying the Partnership?s Trading Value at Risk
The following quantitative disclosures regarding the Partner-
ship?s market risk exposures contain ?forward-looking statements?
within the meaning of the safe harbor from civil liability
provided for such statements by the Private Securities Litigation
Reform Act of 1995 (set forth in Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of
1934).  All quantitative disclosures in this section are deemed
to be forward-looking statements for purposes of the safe harbor,
except for statements of historical fact.

The Partnership accounts for open positions on the basis of mark
to market accounting principles.  Any loss in the market value of
the Partnership?s open positions is directly reflected in the
Partnership?s earnings and cash flow.

The Partnership?s risk exposure in the market sectors traded by
the Trading Managers is estimated below in terms of VaR. The
Partnership estimates VaR using a model based upon historical
<page> simulation (with a confidence level of 99%) which involves
constructing a distribution of hypothetical daily changes in the
value of a trading portfolio.  The VaR model takes into account
linear exposures to risk including equity and commodity prices,
interest rates, foreign exchange rates, and correlation among
these variables. The hypothetical changes in portfolio value are
based on daily percentage changes observed in key market indices
or other market factors (?market risk factors?) to which the
portfolio is sensitive.  The one-day 99% confidence level of the
Partnership?s VaR corresponds to the negative change in portfolio
value that, based on observed market risk factors, would have been
exceeded once in 100 trading days, or one day in 100.  VaR
typically does not represent the worst case outcome.  Demeter uses
approximately four years of daily market data (1,000 observations)
and re-values its portfolio (using delta-gamma approximations) for
each of the historical market moves that occurred over this time
period.  This generates a probability distribution of daily
?simulated profit and loss? outcomes.  The VaR is the appropriate
percentile of this distribution.  For example, the 99% one-day VaR
would represent the 10th worst outcome from Demeter?s simulated
profit and loss series.

The Partnership?s VaR computations are based on the risk
representation of the underlying benchmark for each instrument or
contract and do not distinguish between exchange and non-exchange
<page> dealer-based instruments.  They are also not based on
exchange and/or dealer-based maintenance margin requirements.

VaR models, including the Partnership?s, are continually evolving
as trading portfolios become more diverse and modeling techniques
and systems capabilities improve.  Please note that the VaR model
is used to numerically quantify market risk for historic
reporting purposes only and is not utilized by either Demeter or
the Trading Managers in their daily risk management activities.
Please further note that VaR as described above may not be
comparable to similarly-titled measures used by other entities.

The Partnership?s Value at Risk in Different Market Sectors
The following table indicates the VaR associated with the
Partnership?s open positions as a percentage of total Net Assets
by primary market risk category at September 30, 2007, and 2006.
At September 30, 2007, and 2006, the Partnership?s total
capitalization was approximately $36 million and $50 million,
respectively.

Primary Market	      September 30, 2007	   September 30, 2006
Risk Category		   Value at Risk		Value at Risk
Currency				  (3.20)%			    (2.95)%

The VaR for a market category represents the one-day downside
risk for the aggregate exposures associated with this market
category.  Because the business of the Partnership is the <page>
speculative trading of futures, forwards, and options, the
composition of its trading portfolio can change significantly
over any given time period, or even within a single trading day.
Such changes could positively or negatively materially impact
market risk as measured by VaR.

The table below supplements the quarter-end VaR set forth above
by presenting the Partnership?s high, low, and average VaR, as a
percentage of total Net Assets for the four quarter-end reporting
periods from October 1, 2006, through September 30, 2007.

Primary Market Risk Category        High      Low      Average
Currency   					(4.01)%	(2.79)%	(3.44)%

Limitations on Value at Risk as an Assessment of Market Risk
VaR models permit estimation of a portfolio?s aggregate market
risk exposure, incorporating a range of varied market risks,
reflect risk reduction due to portfolio diversification or hedging
activities, and can cover a wide range of portfolio assets.
However, VaR risk measures should be viewed in light of the
methodology?s limitations, which include, but may not be limited
to the following:
*	past changes in market risk factors will not always result in
accurate predictions of the distributions and correlations of
future market movements;

<page>
*	changes in portfolio value caused by market movements may
differ from those of the VaR model;
*	VaR results reflect past market fluctuations applied to
current trading positions while future risk depends on future
positions;
*	VaR using a one-day time horizon does not fully capture the
market risk of positions that cannot be liquidated or hedged
within one day; and
*	the historical market risk factor data used for VaR estimation
may provide only limited insight into losses that could be
incurred under certain unusual market movements.

In addition, the VaR tables above, as well as the past
performance of the Partnership, give no indication of the
Partnership?s potential ?risk of ruin?.

The VaR tables provided present the results of the Partnership?s
VaR for its market risk exposures at September 30, 2006, and for
the four quarter-end reporting periods from October 1, 2006,
through September 30, 2007.  VaR is not necessarily
representative of the Partnership?s historic risk, nor should it
be used to predict the Partnership?s future financial performance
or its ability to manage or monitor risk.  There can be no
assurance that the Partnership?s actual losses on a particular
<page> day will not exceed the VaR amounts indicated above or
that such losses will not occur more than once in 100 trading
days.

Non-Trading Risk
The Partnership has non-trading market risk on its foreign cash
balances.  The Partnership did not have any foreign currency
balances at September 30, 2007.

The Partnership also maintains a substantial portion of its
available assets in cash at MS&Co.; as of September 30, 2007,
such amount is equal to approximately 99% of the Partnership?s
net asset value.  A decline in short-term interest rates would
result in a decline in the Partnership?s cash management income.
This cash flow risk is not considered to be material.

Materiality, as used throughout this section, is based on an
assessment of reasonably possible market movements and any
associated potential losses, taking into account the leverage,
optionality, and multiplier features of the Partnership?s market-
sensitive instruments, in relation to the Partnership?s Net
Assets.

Qualitative Disclosures Regarding Primary Trading Risk Exposures
The following qualitative disclosures regarding the Partnership?s
market risk exposures - except for (A) those disclosures that are
statements of historical fact and (B) the descriptions of how the
<page> Partnership manages its primary market risk exposures -
constitute forward-looking statements within the meaning of
Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act. The Partnership?s primary market risk
exposures, as well as the strategies used and to be used by
Demeter and the Trading Managers for managing such exposures, are
subject to numerous uncertainties, contingencies and risks, any
one of which could cause the actual results of the Partnership?s
risk controls to differ materially from the objectives of such
strategies. Government interventions, defaults and expro-
priations, illiquid markets, the emergence of dominant
fundamental factors, political upheavals, changes in historical
price relationships, an influx of new market participants,
increased regulation, and many other factors could result in
material losses, as well as in material changes to the risk
exposures and the risk management strategies of the Partnership.
Investors must be prepared to lose all or substantially all of
their investment in the Partnership.

The following was the only trading risk exposure of the
Partnership at September 30, 2007.  It may be anticipated,
however, that market exposure will vary materially over time.

Currency.  The Partnership?s currency market exposure at
September 30, 2007, was to exchange rate fluctuations, primarily
fluctuations which disrupt the historical pricing relationships
<page> between different currencies and currency pairs.  Interest
rate changes, as well as political and general economic
conditions influence these fluctuations.  The Partnership trades
a large number of currencies.  At September 30, 2007, the
Partnership?s primary exposure was to outright U.S. dollar
positions.  Outright positions consist of the U.S. dollar vs.
other currencies.  These other currencies include major and minor
currencies.  Demeter does not anticipate that the risk associated
with the Partnership?s currency trades will change significantly
in the future.

Qualitative Disclosures Regarding Non-Trading Risk Exposure
At September 30, 2007, there was no non-trading risk exposure
because the Partnership did not have any foreign currency
balance.

Qualitative Disclosures Regarding Means of Managing Risk Exposure
The Partnership and the Trading Managers, separately, attempt to
manage the risk of the Partnership?s open positions in essentially
the same manner in all market categories traded.  Demeter attempts
to manage market exposure by diversifying the Partnership?s assets
among different Trading Managers in a multi-manager Partnership,
each of whose strategies focus on different market sectors and
trading approaches, and by monitoring the performance of the
Trading Managers daily.  In addition, the Trading Managers
establish diversification guidelines, often set in terms of the
<page> maximum margin to be committed to positions in any one
market sector or market-sensitive instrument.

Demeter monitors and controls the risk of the Partnership?s non-
trading instrument, cash.  Cash is the only Partnership invest-
ment directed by Demeter, rather than the Trading Managers.

Item 4.	CONTROLS AND PROCEDURES
(a)	As of the end of the period covered by this quarterly
report, the President and Chief Financial Officer of
Demeter, the general partner of the Partnership, have
evaluated the effectiveness of the Partnership?s disclosure
controls and procedures (as defined in Rules 13a?15(e) and
15d?15(e) of the Exchange Act), and have judged such
controls and procedures to be effective.

(b)	There have been no material changes during the period
covered by this quarterly report in the Partnership?s
internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) of the Exchange Act) or in
other factors that could significantly affect these controls
subsequent to the date of their evaluation.

Item 4T.	CONTROLS AND PROCEDURES
Not applicable.
<page> PART II.  OTHER INFORMATION

Item 1A. RISK FACTORS

Information regarding risk factors appears in Item 2.
?Management?s Discussion and Analysis of Financial Condition and
Results of Operations? and Item 3.  ?Quantitative and Qualitative
Disclosures about Market Risk? of this Form 10-Q.  There have been
no other material changes from the risk factors previously
referenced in the Partnership?s Report on Form 10-K for the fiscal
year ended December 31, 2006, and the Partnership?s Report on Form
10Q for the quarters ended March 31, 2007, and June 30, 2007.

Item 6.  EXHIBITS

31.01	Certification of President of Demeter Management
Corporation, the general partner of the Partnership,
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
31.02	Certification of Chief Financial Officer of Demeter
Management Corporation, the general partner of the
Partnership, pursuant to Section 302 of the Sarbanes-
Oxley Act of 2002.
32.01	Certification of President of Demeter Management
Corporation, the general partner of the Partnership,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.
32.02	Certification of Chief Financial Officer of Demeter
Management Corporation, the general partner of the
Partnership, pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.






<page>






SIGNATURE



Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.



                        Morgan Stanley Cornerstone Fund IV L.P.
                          (Registrant)

                        By:   Demeter Management Corporation
                              (General Partner)

November 14, 2007       By:/s/ Lee Horwitz
                               Lee Horwitz
                               Chief Financial Officer





The General Partner which signed the above is the only party
authorized to act for the Registrant.  The Registrant has no
principal executive officer, principal financial officer,
controller, or principal accounting officer and has no Board of
Directors.