ValueAct’s acquisition of a 2% stake in Morgan Stanley is the first, overdue appearance of an activist hedge fund on the global banking scene. What can it hope to accomplish?

ValueAct has a long history of being a "friendly" activist that studies troubled industry situations and seeks to "work with" management and boards to make useful improvements. In this case, ValueAct has expressed confidence in chief executive James Gorman and the Morgan Stanley management team and notes that at 70% of book value, its Morgan Stanley investment has been made at an attractive price no matter what happens.