# EDGAR Filing Document

**Accession Number:** 0000875186
**File Stem:** 0001193125-23-002304
**Filing Date:** 2023-1
**Character Count:** 25683
**Document Hash:** 7fff0aa61e45c702861176abefd89b32
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-23-002304.hdr.sgml**: 20230105

**ACCESSION NUMBER**: 0001193125-23-002304

**CONFORMED SUBMISSION TYPE**: 497K

**PUBLIC DOCUMENT COUNT**: 4

**FILED AS OF DATE**: 20230105

**DATE AS OF CHANGE**: 20230105

**EFFECTIVENESS DATE**: 20230105

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** MORGAN STANLEY PATHWAY FUNDS
- **CENTRAL INDEX KEY:** 0000875186
- **IRS NUMBER:** 000000000
- **FISCAL YEAR END:** 0831

**FILING VALUES:**
- **FORM TYPE:** 497K
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 033-40823
- **FILM NUMBER:** 23510958

**BUSINESS ADDRESS:**
- **STREET 1:** 2000 WESTCHESTER AVENUE
- **CITY:** PURCHASE
- **STATE:** NY
- **ZIP:** 10577
- **BUSINESS PHONE:** 8883749999

**MAIL ADDRESS:**
- **STREET 1:** 2000 WESTCHESTER AVENUE
- **CITY:** PURCHASE
- **STATE:** NY
- **ZIP:** 10577

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** CONSULTING GROUP CAPITAL MARKETS FUNDS
- **DATE OF NAME CHANGE:** 19950125

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** TRUST FOR TRAK INVESTMENTS
- **DATE OF NAME CHANGE:** 19920929

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** INSTITUTIONAL ADVISORS PORTFOLIOS
- **DATE OF NAME CHANGE:** 19600201

## Series and Classes Contracts Data

### Municipal Bond Fund (Series ID: S000008430)

| Class ID   | Class Name          | Ticker Symbol   |
|:---|:---|:---|
| C000023138 | Municipal Bond Fund | TMUUX           |

![](g813390cgcm_cov.gif)

![](g813390morgan_wht.gif)

## Morgan Stanley<br> Pathway Funds
Municipal Bond Fund \| Ticker: TMUUX

#### January 1, 2023
*Summary Prospectus*

Before you invest, you may want to review the Fund's prospectus, which contains more information about the Fund and its risks. The Fund's prospectus, dated January 1, 2023, and Statement of Additional Information, dated January 1, 2023, are incorporated by reference into the summary prospectus, making them legally part of the summary prospectus. You can find the Fund's prospectus and other information about the Fund online at www.morganstanley.com/wealth-investmentsolutions/cgcm. You can also get this information at no cost by calling 1-800-869-3326 or by sending an e-mail request to client.field.services@morganstanley.com.

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#### Investment objective
A high level of interest income that is excluded from federal income taxation, to the extent consistent with prudent investment management and the preservation of capital.

#### Fund fees and expenses
This table describes the fees and expenses you may pay if you buy and hold shares of the Fund.

#### Annual Advisory Program Fees
(fees paid directly from your investment in the applicable Morgan Stanley-sponsored investment advisory program)

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| | |
|:---|:---|
| Maximum annual fees in the Consulting Group Advisor, Select UMA or Portfolio Management investment advisory programs (as a percentage of prior quarter-end net assets)\* | &nbsp;&nbsp;2.00% |

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#### Annual Fund Operating Expenses
(expenses that you pay each year as a percentage of the value of your investment in the Fund)

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| | |
|:---|:---|
| Management Fees\* | &nbsp;&nbsp;0.40% |
| Distribution (12b-1) Fees |  |
| Other Expenses | &nbsp;&nbsp;0.31% |
| Total Annual Fund Operating Expenses | &nbsp;&nbsp;0.71% |
| Waiver\*^ | &nbsp;&nbsp;0.00% |
| Net Annual Fund Operating Expenses\* | &nbsp;&nbsp;0.71% |

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\* CGAS (defined herein) has contractually agreed to waive fees and reimburse expenses in order to keep the Fund's management fees from exceeding the total amount of sub-advisory fees paid by CGAS plus 0.20% based on average net assets. This contractual waiver will only apply if the Fund's total management fees exceed the total amount of sub-advisory fees paid by CGAS plus 0.20% and will not affect the Fund's total management fees if they are less than such amount. This fee waiver and/or reimbursement will continue for at least one year from the date of this prospectus or until such time as the Board of Trustees acts to discontinue all or a portion of such waiver and/or reimbursement when they deem such action is appropriate.

^ No portion of the management fees were waived during the most recent fiscal year.

#### Examples
These examples are intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The examples assume that you invest $10,000 in the Fund for the time periods indicated. The examples also assume that your investment has a 5% return each year and that the Fund's operating expenses remain the same. The figures are calculated based upon total annual Fund operating expenses and a maximum annual fee of 2.00% for the applicable Morgan Stanley-sponsored investment advisory program through which you invest. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

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| | | | |
|:---|:---|:---|:---|
| **AFTER <br> 1 YEAR** | &nbsp;&nbsp;&nbsp;**AFTER <br> 3 YEARS** | &nbsp;&nbsp;&nbsp;**AFTER <br> 5 YEARS** | &nbsp;&nbsp;&nbsp;**AFTER <br> 10 YEARS** |
| $274 | &nbsp;&nbsp;$841 | &nbsp;&nbsp;$1435 | &nbsp;&nbsp;$3041 |

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#### Portfolio turnover
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the above examples, affect the Fund's performance. During the most recent fiscal year, the Fund's portfolio turnover rate was 48% of the average value of its portfolio.

#### Principal investment strategies
The Fund will invest, under normal market conditions, at least 80% of its net assets (plus the amount of any borrowing for investment purposes) in tax exempt general obligation, revenue and private activity bonds and notes, which are issued by or on behalf of states, territories or possessions of the U.S. and the District of Columbia and their political subdivisions, agencies and instrumentalities (including Puerto Rico, the Virgin Islands and Guam). Tax-exempt means that the bonds pay interest that is excluded from gross income for regular federal income tax purposes but such bonds may pay income that is subject to the alternative minimum tax.

**Credit quality. The Fund limits its investments to 20% in municipal obligations that are rated below investment grade by a nationally recognized statistical rating organization, or, if unrated, of equivalent quality as determined by the Sub-adviser (as defined below).**

**Duration. The Fund's average portfolio duration, as calculated by the Sub-adviser, is typically maintained at +/- 3 years of the average benchmark duration, which is the average duration of all the constituent bonds in the Bloomberg U.S. Municipal Bond Index. The Sub-adviser seeks to target the average duration of the benchmark which varies over time and may be impacted by market conditions. Duration is an approximate measure of the sensitivity of the market value of the portfolio holdings to changes in interest rates.**

The Fund may engage in transactions in certain derivatives, such as financial futures contracts and options thereon, indexed and inverse floating rate obligations and swap agreements, including credit default swap agreements. The Fund may use derivative instruments to hedge its investments or to seek to enhance returns.

The Fund may leverage its assets through the use of proceeds received through tender option bond transactions. In a tender option bond transaction, the Fund transfers municipal bonds or other municipal securities into a special purpose entity. A TOB Trust typically issues two classes of beneficial interests: short-term floating rate interests ("TOB Floaters"), which are sold to third party investors, and residual inverse floating rate interests ("TOB Residuals"), which are generally issued to the Fund. The Fund may invest in TOB Residuals and may also invest in TOB Floaters. The Fund will look through to the underlying municipal bond held by a TOB Trust for purposes of the Fund's 80% policy.

2 MORGAN STANLEY \| 2023<br>

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#### Principal risks of investing in the Fund
Loss of money is a risk of investing in the Fund.

The Fund's principal risks include:

• *Market Risk , which is the risk that municipal bond prices decline overall. Markets are volatile and can decline significantly in response to real or perceived adverse issuer, political, regulatory, market or economic developments in the U.S. and in other countries. Similarly, environmental and public health risks, such as natural disasters, epidemics, pandemics or widespread fear that such events may occur, may impact markets adversely and cause market volatility in both the short- and long-term. Market risk may affect a single company, sector of the economy or the market as a whole. Declines in dealer market-making capacity as a result of structural or regulatory changes could decrease liquidity and/or increase volatility in the fixed income markets.* 

• *Interest Rate Risk , which is the risk that interest rates rise and fall over time. When interest rates are low, the Fund's yield and total return also may be low. When interest rates rise, bond prices generally fall, which might cause the Fund's share price to fall. When the Fund holds variable or floating rate securities, a decrease (or, in the case of inverse floating rate securities, an increase) in market interest rates will adversely affect the income received from such securities and the net asset value of the Fund's shares.* 

• *Credit and Junk Bond Risk , which means the credit quality of an investment could cause the Fund to lose money. Non-investment grade securities (sometimes called "high yield securities" or "junk bonds") involve greater risks of default or downgrade, are more volatile and may be more susceptible than other issuers to economic downturns. Such securities are subject to the risk that the issuer may not be able to pay interest or dividends and ultimately to repay principal upon maturity, which could substantially adversely affect the market value of the securities.* 

• *Prepayment and Extension Risks , which means a debt obligation may be paid off earlier or later than expected. Either situation could cause the Fund to hold securities paying lower-than-market rates of interest, which could hurt the Fund's yield or share price.* 

• *Municipal Securities Risk , which includes the risk that new federal or state legislation or Internal Revenue Service determinations may adversely affect the tax-exempt status of securities held by the Fund or the financial ability of the municipalities to repay these obligations. Municipal securities, like other fixed income securities, rise and fall in value in response to economic and market factors, primarily changes in interest rates, and actual or perceived credit quality. Rising interest rates will generally cause municipal securities to decline in value. Longer-term securities usually respond more sharply to interest rate changes than do shorter-term securities. A municipal security will also lose value if, due to rating downgrades or other factors, there are concerns about the issuer's current or future ability to make principal or interest payments. State and local governments rely on taxes and, to some extent, revenues from private projects financed by municipal securities, to pay interest and* 

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| | |
|:---|:---|
|  | principal on municipal debt. Poor statewide or local economic results or changing political sentiments may reduce tax revenues and increase the expenses of municipal issuers, making it more difficult for them to meet their obligations. Actual or perceived erosion of the creditworthiness of municipal issuers may reduce the value of the Fund's holdings. As a result, the Fund will be more susceptible to factors that adversely affect issuers of municipal obligations than a mutual fund that does not have as great a concentration in municipal obligations. Also, there may be economic or political changes that impact the ability of issuers of municipal securities to repay principal and to make interest payments on securities owned by the Fund. Any changes in the financial condition of municipal issuers may also adversely affect the value of the Fund's securities. Due to local economic and financial conditions, certain municipal issuers will be more susceptible to default on their obligations than others. Each of these risks may be heightened with respect to investments in U.S. instrumentalities, such as Guam, the Virgin Islands and Puerto Rico. |
| • | *Liquidity Risk, exists when securities are difficult or impossible for the Fund to sell at the time and the price that the Fund would like due to a limited market or to legal restrictions. These securities may also need to be fair valued.* |
| • | *Taxation Risk, which means the possibility that some of the Fund's income distributions, and distributions of the Fund's gains, may be subject to federal taxation. The Fund will rely on the opinions of issuers' bond counsel on the tax-exempt status of interest on municipal bond obligations. Neither the Fund nor its Sub-adviser will independently review the bases for those tax opinions, which may ultimately be determined to be incorrect and subject the Fund and its shareholders to substantial tax liabilities. In addition, the Fund may realize taxable gains on the sale of its securities or other transactions, and some of the Fund's income distributions may be subject to the federal alternative minimum tax. This may result in a lower tax-adjusted return. Additionally, distributions of the Fund's income and gains generally will be subject to state taxation. Municipal bond funds are generally not appropriate investments for those investing through a tax-deferred account, such as an individual retirement account or employer-sponsored retirement plan, because the funds' tax advantages are not applicable if investing through such an account.* |
| • | *LIBOR Transition Risk refers to the fact that the elimination of the London Inter-Bank Offered Rate ("LIBOR") rate may adversely affect the interest rates on, and value of, certain Fund investments that are tied to LIBOR. The U.K. Financial Conduct Authority stopped compelling or inducing banks to submit certain LIBOR rates and will do so for the remaining LIBOR rates immediately after June 30, 2023. Alternatives to LIBOR are established or in development in most major currencies and markets are slowly responding to these new rates. It is difficult to predict the full impact of the transition away from LIBOR on the Fund.* |

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3 MORGAN STANLEY \| 2023<br>

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• *Manager Risk , which is the risk that poor security selection by the Sub-adviser will cause the Fund to underperform relevant benchmarks or other investments with similar strategies. This risk is common for all actively managed funds.* 

• *Issuer Risk, which is the risk that the value of a security may decline for reasons directly related to the issuer, such as management performance, financial leverage and reduced demand for the issuer's goods or services.* 

• *Leverage Risk, which means the Fund's use of leverage may exaggerate the effect of any increase or decrease in the value of the Fund's portfolio securities and cause the Fund to liquidate portfolio positions when it may not be advantageous to do so to satisfy its obligations or to maintain asset coverage.* 

• *Tender Option Bonds and Related Securities Risk , which means the Fund's participation in tender option bond transactions may reduce the Fund's returns and/or increase volatility. Investments in tender option bond transactions expose the Fund to counterparty risk and leverage risk. An investment in a tender option bond transaction typically will involve greater risk than an investment in a municipal fixed rate security, including the risk of loss of principal. Distributions on TOB Residuals will bear an inverse relationship to short-term municipal security interest rates. Distributions on TOB Residuals paid to the Fund will be reduced or, in the extreme, eliminated as short-term municipal interest rates rise and will increase when short-term municipal interest rates fall. TOB Residuals generally will underperform the market for fixed rate municipal securities in a rising interest rate environment. The Fund may invest in TOB Trusts on either a non-recourse or recourse basis. If the Fund invests in a TOB Trust on a recourse basis, it could suffer losses in excess of the value of its TOB Residuals.* 

• *Derivatives Risk, which means that the Fund's use of futures, options and swaps based on fixed income instruments to enhance returns or hedge against market declines subjects the Fund to potentially greater volatility and/or losses. Even a small investment in futures, options and swaps can have a large impact on the Fund's interest rate, securities market and currency exposure. Therefore,* 

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| | |
|:---|:---|
|  | using futures, options and swaps can disproportionately increase losses and reduce opportunities for gains when interest rates, stock prices or currency rates are changing. The Fund may not fully benefit from or may lose money on its investment in futures, options and swaps if changes in their value do not correspond accurately to changes in the value of the Fund's holdings. The other party to certain futures, options and swaps presents the same types of credit risks as issuers of fixed income securities. Investing in futures, options and swaps can also make the Fund's assets less liquid and harder to value, especially in declining markets. |
| • | *Floating Rate Obligations Risk, which is the risk that unexpected changes in the interest rates on floating rate obligations could result in losses to the Fund. The price of inverse floating rate obligations (inverse floaters) is expected to decline when interest rates rise, and generally will be more volatile and decline further than the price of a bond with a similar maturity.* |

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An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. For more information on the risks of investing in the Fund please see the ***Fund details*** section of this Prospectus.

#### Performance
The bar chart below shows how the Fund's investment results have varied from year to year, and the following table shows how the Fund's annual total returns for various periods compare to those of the Fund's benchmark index and Lipper peer group. This information provides some indication of the risks of investing in the Fund. The Fund is available only to investors participating in Morgan Stanley-sponsored investment advisory programs. These programs charge an annual fee (see Annual Advisory Program Fees above). **The performance information in the bar chart and table below does not reflect this fee, which would reduce your return.** The Fund's past performance, before and after taxes, does not necessarily indicate how the Fund will perform in the future. For current performance information please see www.morganstanley.com/wealth-investmentsolutions/cgcm.

4 MORGAN STANLEY \| 2023<br>

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#### Annual total returns (%) calendar years

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#### Municipal Bond Fund
![](g813390mb_barchart1.jpg)

#### Fund's best and worst calendar quarters
Best: 3.02% in 1st quarter 2019<br> Worst: (3.76)% in 4th quarter 2016<br> Year-to-date: (12.55)% (through 3rd quarter 2022)

#### Average Annual Total Returns
(for the periods ended December 31, 2021)

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| | | | |
|:---|:---|:---|:---|
| **INCEPTION DATE: 11/18/1991** | &nbsp;&nbsp;&nbsp;**1 YEAR** | &nbsp;&nbsp;&nbsp;**5 YEARS** | &nbsp;&nbsp;&nbsp;**10 YEARS** |
| **Fund (without advisory program fee)** | **Fund (without advisory program fee)** | **Fund (without advisory program fee)** | **Fund (without advisory program fee)** |
| Return Before Taxes | &nbsp;&nbsp;1.21% | &nbsp;&nbsp;3.41% | &nbsp;&nbsp;2.98% |
| Return After Taxes on Distributions | &nbsp;&nbsp;1.12% | &nbsp;&nbsp;3.28% | &nbsp;&nbsp;2.55% |
| Return After Taxes on Distributions and Sale of Fund Shares | &nbsp;&nbsp;1.42% | &nbsp;&nbsp;3.11% | &nbsp;&nbsp;2.58% |
| Bloomberg U.S. Municipal Bond Index (reflects no deduction for fees, expenses or taxes) | &nbsp;&nbsp;1.52% | &nbsp;&nbsp;4.17% | &nbsp;&nbsp;3.72% |
| Lipper General & Insured Municipal Debt Funds Average | &nbsp;&nbsp;2.28% | &nbsp;&nbsp;4.14% | &nbsp;&nbsp;3.81% |

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The after-tax returns are calculated using the highest historical individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an individual investor's tax situation and may differ from those shown. In some cases, the return after taxes may exceed the return before taxes due to an assumed tax benefit from any losses on a sale of Fund shares at the end of the measurement period.

The Fund's primary benchmark is the Bloomberg U.S. Municipal Bond Index. The benchmark is a composite measure of the total return performance of the municipal bond market. Unlike the Fund, the benchmark is unmanaged and does not include any fees or expenses. An investor cannot invest directly in an index.

The Fund also compares its performance with the Lipper General & Insured Municipal Debt Funds Average. The Lipper General & Insured Municipal Debt Funds Average is composed of funds that, by fund practice, invest in municipal debt issues in the top four credit ratings as determined by a nationally recognized statistical rating organization.

#### Investment adviser
Consulting Group Advisory Services LLC ("CGAS" or the "Manager"), a business of Morgan Stanley Wealth Management ("MSWM"), serves as the investment adviser for the Fund. Subject to Board review, the Manager selects and oversees professional money managers (each a "Sub-adviser," collectively, the "Sub-advisers") who are responsible for investing the assets of the Fund. The Sub-advisers are selected based primarily upon the research and recommendation of the Manager, which includes a quantitative and qualitative evaluation of a Sub-adviser's skills and investment results in managing assets for specific asset classes, investment styles and strategies. The Manager allocates and, when appropriate, reallocates the Fund's assets among one or more Sub-advisers, continuously monitors and evaluates Sub-adviser performance (including trade execution), performs other due diligence functions (such as an assessment of changes in personnel or other developments at the Sub-advisers), and oversees Sub-adviser compliance with the Fund's investment objectives, policies and guidelines. The Manager also monitors changes in market conditions and considers whether changes in the allocation of Fund assets or the lineup of Sub-advisers should be made in response to such changes in market conditions. Sub-advisers may also periodically recommend changes or enhancements to the Fund's investment objectives, policies and guidelines, which are subject to the approval of the Manager and may also be subject to the approval of the Board.

5 MORGAN STANLEY \| 2023<br>

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#### Sub-adviser and portfolio managers
BlackRock Financial Management, Inc. ("BlackRock")

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| | | |
|:---|:---|:---|
| **PORTFOLIO MANAGERS** | &nbsp;&nbsp;&nbsp;**SUB-ADVISER OR ADVISER** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**FUND' PORTFOLIO<br> MANAGER SINCE** |
| Michael Kalinoski, CFA<sup>®</sup> Director | &nbsp;&nbsp;BlackRock | &nbsp;&nbsp;&nbsp;&nbsp;2019 |
| Kevin Maloney, CFA<sup>®</sup> Director | &nbsp;&nbsp;BlackRock | &nbsp;&nbsp;&nbsp;&nbsp;2019 |

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#### Purchase and sale of Fund shares
Purchases of shares of the Fund must be made through an investment advisory program with Morgan Stanley. You may purchase or sell shares of the Fund at net asset value on any day the New York Stock Exchange ("NYSE") is open by contacting your Morgan Stanley Financial Advisor.

• The minimum initial aggregate
investment in the Morgan Stanley-sponsored investment advisory programs is $1,000.

• There is no minimum on
additional investments in the Fund or the applicable investment advisory program through which you invest.

• Each of the Fund and the
Morgan Stanley-sponsored investment advisory programs through which investments in the Fund are offered may vary or waive these investment minimums at any time.

For more information about the Morgan Stanley-sponsored investment advisory programs, see the About the Funds section of this Prospectus.

#### Tax information
The Fund's distributions are generally expected to be exempt from regular federal income tax.

#### Payments to financial intermediaries
If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your sales person to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

6 MORGAN STANLEY \| 2023<br>

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| **®2022 Morgan Stanley. Member SIPC** | **CS -8 1/22** |

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