The arrival of an activist investor in Morgan Stanley’s stock is both a validation of the strategy pursued by chief executive James Gorman and a challenge to articulate and execute it better.

ValueAct Capital Management, a $16 billion hedge fund with a penchant for high-profile turnaround stories, unveiled a $1.1 billion stake in Morgan Stanley on August 15 and, in a letter to the fund's own investors, showed support for Gorman's plan to move the bank away from risky activities like trading and into more stable areas like wealth management.