================================================================================
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: June 30, 2000
Commission File Number: 333-9898
KENMAR GLOBAL TRUST
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 06-6429854
------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Two American Lane,
P.O. Box 5150,
Greenwich, Connecticut 06831
---------------------------------------------------
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (203) 861-1000
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 periods 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
--- ---
================================================================================
<PAGE>
KENMAR GLOBAL TRUST
QUARTER ENDED JUNE 30, 2000
----------
TABLE OF CONTENTS
Page
----
PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements
Statements of Financial Condition as of June 30,
2000 (unaudited) and December 31, 1999 (audited) ...... 1
Statements of Operations for the Three Months Ended
June 30, 2000 and 1999 and for the Six Months Ended
June 30, 2000 and 1999 (unaudited) .................... 2
Statements of Cash Flows for the Six Months Ended
June 30, 2000 and 1999 (unaudited) .................... 3
Statements of Changes in Unitholders' Capital
(Net Asset Value) for the Six Months Ended June 30,
2000 and 1999 (unaudited) ............................. 4
Notes to Financial Statements (unaudited) ............. 5-8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations ................... 9-10
PART II -- OTHER INFORMATION
Item 2. Changes in Securities ................................. 10
Item 6. Exhibits and Reports on Form 8-K ...................... 10
SIGNATURES ............................................................... 11
<PAGE>
<TABLE>
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
KENMAR GLOBAL TRUST
STATEMENTS OF FINANCIAL CONDITION
June 30, 2000 (Unaudited) and December 31, 1999 (Audited)
<CAPTION>
June 30, December 31,
2000 1999
----------- -----------
<S> <C> <C>
ASSETS
Equity in broker trading accounts
Cash ................................................ $11,811,399 $ 3,275,658
Unrealized gain on open contracts ................... 18,732 70,254
----------- -----------
Deposits with brokers ........................ 11,830,131 3,345,912
Cash and cash equivalents ............................. 9,451,164 23,481,079
----------- -----------
Total assets ................................. $21,281,295 $26,826,991
=========== ===========
LIABILITIES
Accounts payable ...................................... $ 28,864 $ 40,000
Commissions and other trading fees on open contracts .. 32,094 5,394
Managing Owner brokerage commissions .................. 122,604 196,233
Advisor profit shares ................................. 17,789 13,388
Redemptions payable ................................... 722,201 3,724,738
Redemption charges payable to Managing Owner .......... 5,748 69,885
----------- -----------
Total liabilities ............................ 929,300 4,049,638
----------- -----------
UNITHOLDERS' CAPITAL (NET ASSET VALUE)
Managing Owner - 2,813.3231 units outstanding
at June 30, 2000 and December 31, 1999 .............. 274,212 280,146
Other Unitholders - 205,991.2434 and 225,924.9857 units
outstanding at June 30, 2000 and December 31, 1999 .. 20,077,783 22,497,207
----------- -----------
Total Unitholders' capital
(Net Asset Value) .......................... 20,351,995 22,777,353
----------- -----------
$21,281,295 $26,826,991
=========== ===========
</TABLE>
See accompanying notes.
1
<PAGE>
<TABLE>
KENMAR GLOBAL TRUST
STATEMENTS OF OPERATIONS
For the Three Months Ended June 30, 2000 and 1999 and
For the Six Months Ended June 30, 2000 and 1999
(Unaudited)
<CAPTION>
Three Months Six Months
Ended Ended
June 30, June 30,
------------------------- ---------------------------
2000 1999 2000 1999
--------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
INCOME
Trading gains (losses)
Realized ................................ $ 584,881 $ (544,038) $ 407,286 $ (993,075)
Change in unrealized .................... (131,480) 1,466,692 (51,522) 287,326
--------- ---------- ---------- -----------
Gain (loss) from trading ......... 453,401 922,654 355,764 (705,749)
Interest income ............................ 293,393 259,201 591,588 493,901
--------- ---------- ---------- -----------
Total income (loss) .............. 746,794 1,181,855 947,352 (211,848)
--------- ---------- ---------- -----------
EXPENSES
Brokerage commissions ...................... 101,254 67,325 209,772 146,536
Managing Owner brokerage commissions ....... 484,548 633,095 1,002,378 1,257,560
Advisor profit shares ...................... 17,789 59,483 64,821 95,925
Operating expenses ......................... 29,627 57,417 75,265 129,378
--------- ---------- ---------- -----------
Total expenses ................... 633,218 817,320 1,352,236 1,629,399
--------- ---------- ---------- -----------
NET INCOME (LOSS) ................ $ 113,576 $ 364,535 $ (404,884) $(1,841,247)
========= ========== ========== ===========
NET INCOME (LOSS) PER UNIT
(based on weighted average number of
units outstanding during the period) ....... $ .52 $ 1.49 $ (1.81) $ (7.78)
========= ========== ========== ===========
INCREASE (DECREASE) IN NET
ASSET VALUE PER UNIT ....................... $ .49 $ 1.20 $ (2.11) $ (8.46)
========= ========== ========== ===========
</TABLE>
See accompanying notes.
2
<PAGE>
<TABLE>
KENMAR GLOBAL TRUST
STATEMENTS OF CASH FLOWS
For the Six Months Ended June 30, 2000 and 1999
(Unaudited)
<CAPTION>
Six Months
Ended
June 30,
---------------------------
2000 1999
------------ ------------
<S> <C> <C>
CASH FLOWS FROM (FOR) OPERATING ACTIVITIES
Net (loss) ....................................................... $ (404,884) $(1,841,247)
Adjustments to reconcile net (loss) to net cash (for)
operating activities:
(Increase) in option premiums paid ........................ 0 (52,508)
Net change in unrealized .................................. 51,522 (287,326)
Increase (decrease) in accounts payable
and accrued expenses .................................... (53,664) 4,803
----------- -----------
Net cash (for) operating activities ................... (407,026) (2,176,278)
----------- -----------
CASH FLOWS FROM (FOR) FINANCING ACTIVITIES
Addition of units ................................................ 2,082,255 4,777,758
Decrease in subscription deposits ................................ 0 (27,720)
Offering costs paid .............................................. (66,280) (153,076)
Redemption of units .............................................. (7,103,123) (1,707,052)
----------- -----------
Net cash from (for) financing activities ............... (5,087,148) 2,889,910
----------- -----------
Net increase (decrease) in cash and cash equivalents ............... (5,494,174) 713,632
CASH
Beginning of period ............................................. 26,756,737 24,871,201
----------- -----------
End of period ................................................... $21,262,563 $25,584,833
=========== ===========
END OF PERIOD CASH AND CASH EQUIVALENTS CONSISTS OF:
Cash in broker trading accounts ................................. $11,811,399 $12,360,894
Cash and cash equivalents ....................................... 9,451,164 13,223,939
----------- -----------
Total end of period cash and cash equivalents ......... $21,262,563 $25,584,833
=========== ===========
</TABLE>
See accompanying notes.
3
<PAGE>
<TABLE>
KENMAR GLOBAL TRUST
STATEMENTS OF CHANGES IN UNITHOLDERS' CAPITAL (NET ASSET VALUE)
For the Six Months Ended June 30, 2000 and 1999
(Unaudited)
<CAPTION>
Unitholders' Capital
Total ----------------------------------------
Number of Managing Other
Units Owner Unitholders Total
----------- -------- ----------- -----------
<S> <C> <C> <C> <C>
SIX MONTHS ENDED JUNE 30, 2000
Balances at
December 31, 1999 .......... 228,738.3088 $280,146 $22,497,207 $22,777,353
Net (loss) for the six months
ended June 30, 2000 ........ (5,119) (399,765) (404,884)
Additions ...................... 21,174.3281 0 2,082,255 2,082,255
Redemptions .................... (41,108.0704) 0 (4,036,449) (4,036,449)
Offering costs ................. (815) (65,465) (66,280)
------------ -------- ----------- -----------
Balances at
June 30, 2000 .............. 208,804.5665 $274,212 $20,077,783 $20,351,995
============ ======== =========== ===========
SIX MONTHS ENDED JUNE 30, 1999
Balances at
December 31, 1998 .......... 224,076.5973 $263,850 $25,099,248 $25,363,098
Net (loss) for the six months
ended June 30, 1999 ........ (19,273) (1,821,974) (1,841,247)
Additions ...................... 45,767.2734 35,000 4,817,038 4,852,038
Redemptions .................... (14,517.4459) 0 (1,526,261) (1,526,261)
Offering costs ................. (1,131) (106,970) (108,101)
------------ -------- ----------- -----------
Balances at
June 30, 1999 .............. 255,326.4248 $278,446 $26,461,081 $26,739,527
============ ======== =========== ===========
<CAPTION>
Net Asset Value Per Unit
------------------------------------------------------------------
June 30, December 31, June 30, December 31,
2000 1999 1999 1998
-------- ------------ -------- ------------
<S> <C> <C> <C>
$97.47 $99.58 $104.73 $113.19
====== ====== ======= =======
</TABLE>
See accompanying notes.
4
<PAGE>
KENMAR GLOBAL TRUST
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Note 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. General Description of the Fund
Kenmar Global Trust (the Fund) is a Delaware business trust. The
Fund is a multi-advisor, multi-strategy commodity pool which trades
in United States (U.S.) and foreign futures, options, forwards and
related markets. The Fund was formed on July 17, 1996 and commenced
trading on May 22, 1997.
B. Regulation
As a registrant with the Securities and Exchange Commission, the
Fund is subject to the regulatory requirements under the Securities
Act of 1933 and the Securities Exchange Act of 1934. As a commodity
pool, the Fund is subject to the regulations of the Commodity
Futures Trading Commission, an agency of the U.S. government which
regulates most aspects of the commodity futures industry; rules of
the National Futures Association, an industry self-regulatory
organization; and the requirements of the various commodity
exchanges where the Fund executes transactions. Additionally, the
Fund is subject to the requirements of the Futures Commission
Merchants (FCMs) and interbank market makers (collectively,
"brokers") through which the Fund trades.
C. Method of Reporting
The Fund's financial statements are presented in accordance with
generally accepted accounting principles, which require the use of
certain estimates made by the Fund's management. Gains or losses are
realized when contracts are liquidated. Net unrealized gain or loss
on open contracts (the difference between contract purchase price
and market price) is reflected in the statement of financial
condition in accordance with Financial Accounting Standards Board
Interpretation No. 39 - "Offsetting of Amounts Related to Certain
Contracts." Any change in net unrealized gain or loss from the
preceding period is reported in the statement of operations.
Brokerage commissions paid directly to brokers include other trading
fees and are charged to expense when contracts are opened.
D. Cash and Cash Equivalents
Cash and cash equivalents includes cash and short-term time deposits
held at financial institutions.
E. Income Taxes
The Fund prepares calendar year U.S. and state information tax
returns and reports to the Unitholders their allocable shares of the
Fund's income, expenses and trading gains or losses.
F. Offering Costs
Offering costs are borne by the Fund and are charged directly to
unitholders' capital as incurred.
5
<PAGE>
KENMAR GLOBAL TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
Note 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
G. Foreign Currency Transactions
The Fund's functional currency is the U.S. dollar; however, it
transacts business in currencies other than the U.S. dollar. Assets
and liabilities denominated in currencies other than the U.S. dollar
are translated into U.S. dollars at the rates in effect at the date
of the statement of financial condition. Income and expense items
denominated in currencies other than the U.S. dollar are translated
into U.S. dollars at the rates in effect during the period. Gains
and losses resulting from the translation to U.S. dollars are
reported in income currently.
Note 2. MANAGING OWNER
The Managing Owner of the Fund is Kenmar Advisory Corp., which conducts
and manages the business of the Fund. The Declaration of Trust and Trust
Agreement requires the Managing Owner to maintain a capital account
equal to 1% of the total capital accounts of the Fund.
The Managing Owner is paid monthly brokerage commissions equal to 1/12
of 11% (11% annually) of the Fund's beginning of month Net Asset Value.
The Managing Owner, in turn, pays substantially all actual costs of
executing the Fund's trades, selling commissions and trailing
commissions to selling agents, and consulting fees to the Advisors. The
amount paid to the Managing Owner is reduced by brokerage commissions
and other trading fees paid directly by the Fund.
The Managing Owner is paid an incentive fee equal to 5% of New Overall
Appreciation (which is defined in the Declaration of Trust and Trust
Agreement and excludes interest income) as of each fiscal year-end and
upon redemption of Units. No incentive fee was earned by the Managing
Owner during the three months and six months ended June 30, 2000 and
1999.
Note 3. COMMODITY TRADING ADVISORS
The Fund has advisory agreements with various commodity trading advisors
pursuant to which the Fund pays quarterly profit shares of 20% of
Trading Profit (as defined in each advisory agreement).
Note 4. DEPOSITS WITH BROKERS
The Fund deposits cash with brokers subject to Commodity Futures Trading
Commission regulations and various exchange and broker requirements.
Margin requirements are satisfied by the deposit of cash with such
brokers. The Fund earns interest income on its cash deposited with the
brokers.
Note 5. SUBSCRIPTIONS, DISTRIBUTIONS AND REDEMPTIONS
Investments in Units of Beneficial Interest are made by subscription
agreement, subject to acceptance by the Managing Owner.
6
<PAGE>
KENMAR GLOBAL TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
Note 5. SUBSCRIPTIONS, DISTRIBUTIONS AND REDEMPTIONS (CONTINUED)
The Fund is not required to make distributions, but may do so at the
sole discretion of the Managing Owner. A Unitholder may request and
receive redemption of Units owned, beginning with the end of the sixth
month after such Units are sold, subject to restrictions in the
Declaration of Trust and Trust Agreement. Units redeemed on or before
the end of the twelfth full calendar month and after the end of the
twelfth full month but on or before the end of the eighteenth full
calendar month after the date such Units begin to participate in the
profits and losses of the Fund are subject to early redemption charges
of 3% and 2%, respectively, of the Net Asset Value redeemed. All
redemption charges are paid to the Managing Owner. Such redemption
charges are included in redemptions in the statement of changes in
Unitholders' capital and amounted to $27,168 and $9,663 during the six
months ended June 30, 2000 and 1999, respectively.
Note 6. TRADING ACTIVITIES AND RELATED RISKS
The Fund engages in the speculative trading of U.S. and foreign futures
contracts, options on U.S. and foreign futures contracts and forward
contracts (collectively, "derivatives"). These derivatives include both
financial and non-financial contracts held as part of a diversified
trading strategy. The Fund is exposed to both market risk, the risk
arising from changes in the market value of the contracts, and credit
risk, the risk of failure by another party to perform according to the
terms of a contract.
Purchases and sales of futures and options on futures contracts require
margin deposits with the FCMs. Additional deposits may be necessary for
any loss of contract value. The Commodity Exchange Act requires an FCM
to segregate all customer transactions and assets from such FCM's
proprietary activities. A customer's cash and other property (for
example, U.S. Treasury bills) deposited with an FCM are considered
commingled with all other customer funds subject to the FCM's
segregation requirements. In the event of an FCM's insolvency, recovery
may be limited to a pro rata share of segregated funds available. It is
possible that the recovered amount could be less than total cash and
other property deposited.
The Fund has cash and cash equivalents on deposit with interbank market
makers and other financial institutions in connection with its trading
of forward contracts and its cash management activities. In the event of
a financial institution's insolvency, recovery of Fund assets on deposit
may be limited to account insurance or other protection afforded such
deposits. Since forward contracts are traded in unregulated markets
between principals, the Fund also assumes the risk of loss from
counterparty nonperformance.
For derivatives, risks arise from changes in the market value of the
contracts. Theoretically, the Fund is exposed to a market risk equal to
the value of futures and forward contracts purchased and unlimited
liability on such contracts sold short. As both a buyer and seller of
options, the Fund pays or receives a premium at the outset and then
bears the risk of unfavorable changes in the price of the contract
underlying the option. Written options expose the Fund to potentially
unlimited liability, and purchased options expose the Fund to a risk of
loss limited to the premiums paid.
The Managing Owner has established procedures to actively monitor market
risk and minimize credit risk. The Unitholders bear the risk of loss
only to the extent of the market value of their respective investments
and, in certain specific circumstances, distributions and redemptions
received.
7
<PAGE>
KENMAR GLOBAL TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
Note 7. INTERIM FINANCIAL STATEMENTS
The statement of financial condition as of June 30, 2000, the statements
of operations for the three months and six months ended June 30, 2000
and 1999, and the statements of cash flows and changes in unitholders'
capital (net asset value) for the six months ended June 30, 2000 and
1999 are unaudited. In the opinion of management, such financial
statements reflect all adjustments, which were of a normal and recurring
nature, necessary for a fair presentation of financial position as of
June 30, 2000, the results of operations for the three months and six
months ended June 30, 2000 and 1999, and cash flows for the six months
ended June 30, 2000 and 1999.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The proceeds of the offering of the units of beneficial interest (the "Units")
are used by the Fund to engage in the speculative trading of futures, forward,
options and related markets through allocating such proceeds to multiple
commodity trading advisors (the "Advisors").
The assets of the Fund are deposited with commodity brokers and interbank
dealers (collectively, the "Clearing Brokers") in trading accounts established
by the Fund for the Advisors and are used by the Fund as margin to engage in
trading. Such assets are held in either a non-interest bearing bank account or
in securities approved by the CFTC for investment of customer funds.
CAPITAL RESOURCES. The Fund does not have, nor does it expect to have, any
capital assets. Redemptions and sales of the Units in the future will affect the
amount of funds available for trading futures, forwards and options in
subsequent periods.
There are three primary factors that affect the Fund's capital resources: (i)
the trading profit or loss generated by the Advisors (including interest
income); (ii) the capital invested or redeemed by the Unitholders of the Fund
(the "Unitholders"); and (iii) the capital invested or redeemed by the Fund's
managing owner, Kenmar Advisory Corp. ("Kenmar"). Kenmar has maintained, and has
agreed to maintain, at all times a one percent (1%) interest in the Fund. All
capital contributions by Kenmar necessary to maintain such capital account
balance are evidenced by Units, each of which has an initial value equal to the
Net Asset Value Per Unit (as defined below) at the time of such contribution.
Kenmar, in its sole discretion, may withdraw any excess above its required
capital contribution without notice to the Unitholders. Kenmar, in its sole
discretion, also may contribute any greater amount to the Fund, for which it
shall receive, at its option, additional Units at their then-current Net Asset
Value (as defined below).
"Net Asset Value" is defined as total assets of the Fund less total liabilities
as determined in accordance with generally accepted accounting principles as
described in the Fund's Amended and Restated Declaration of Trust and Trust
Agreement dated as of December 17, 1996 (the "Declaration of Trust Agreement").
The term "Net Asset Value Per Unit" is defined in the Declaration of Trust
Agreement to mean the Net Assets of the Fund divided by the number of Units
outstanding as of the date of determination.
RESULTS OF OPERATIONS. The Fund incurs substantial charges from the payment of
profit shares to the Advisors, incentive fees and brokerage commissions to
Kenmar, miscellaneous execution costs, operating, selling and administrative
expenses. Brokerage commissions are payable based upon the Net Asset Value of
the Fund and are payable without regard to the profitability of the Fund. As a
result, it is possible that the Fund may incur a net loss when trading profits
are not substantial enough to avoid depletion of the Fund's assets from such
fees and expenses. Thus, due to the nature of the Fund's business, the success
of the Fund is dependent upon the ability of the Advisors to generate trading
profits through the speculative trading of futures, forwards and options
sufficient to produce capital appreciation after payment of all fees and
expenses.
It is important to note that (i) the Advisors trade in various markets at
different times and that prior activity in a particular market does not mean
that such markets will be actively traded by an Advisor or will be profitable in
the future and (ii) the Advisors trade independently of each other using
different trading systems and may trade different markets with various
concentrations at various times. Consequently, the results of operations of the
Fund can only be discussed in the context of the overall trading activities of
the Fund, the Advisors' trading activities on behalf of the Fund as a whole and
how the Fund has performed in the past.
As of June 30, 2000, the Net Asset Value of the Fund was $20,351,995, a decrease
of approximately 5.71% from its Net Asset Value of $21,584,769 at March 31,
2000. The Fund's subscriptions and redemptions for the quarter ended June 30,
2000, totaled $912,755 and $2,253,105, respectively. For the quarter ended June
30, 2000, the Fund had revenue comprised of $584,881 in realized trading gains,
$(131,480) in change in unrealized trading losses and $293,393 in interest
income compared to revenue comprised of $(544,038) in realized trading losses,
$1,466,692 in change in unrealized trading gains and $259,201 in interest income
for the same period in 1999. Total income for the second quarter of 2000
decreased by $435,061 from the same period for 1999, while total expenses
decreased by $184,102 between these periods. The Net Asset Value per Unit at
June 30, 2000 increased .51% from $96.98 at March 31, 2000, to $97.47 at June
30, 2000. The Fund's positive performance for the quarter ended June 30, 2000,
resulted primarily from energies, tropicals, currencies and European stock
indices.
The Net Asset Value of the Fund decreased $2,425,358 or 10.65% from December 31,
1999 through June 30, 2000. The Fund's subscriptions and redemptions for the six
months ended June 30, 2000, totaled $2,082,255 and $4,036,449,
9
<PAGE>
respectively. For the six months ended June 30, 2000, the Fund had revenue
comprised of $407,286 in realized trading gains, $(51,522) in change in
unrealized trading losses and $591,588 in interest income compared to revenue
comprised of $(993,075) in realized trading losses, $287,326 in change in
unrealized trading gains and $493,901 in interest income for the same period in
1999. The total income for the first six months of 2000 increased by $1,159,200
from the same period for 1999, while total expenses decreased by $277,163
between these periods. The Net Asset Value per Unit at June 30, 2000 decreased
2.12% from $99.58 at December 31, 1999, to $97.47 at June 30, 2000. The Fund's
negative performance for the six months ended June 30, 2000 resulted primarily
from U.S. and European interest rates, grains and metals.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.
AS A RESULT, ANY RECENT INCREASES IN REALIZED OR UNREALIZED TRADING GAINS
MAY HAVE NO BEARING ON ANY RESULTS THAT MAY BE OBTAINED IN THE FUTURE.
LIQUIDITY. Units may be redeemed at Net Asset Value, at a Unitholder's option,
as of the close of business on the last day of each month, beginning with the
6th month-end following their sale. Units redeemed on the 6th month-end through
the 12th month-end after sale are subject to a 3% redemption charge. Units
redeemed on the 13th month-end through the 18th month-end after sale are subject
to a 2% redemption charge. After the end of the 18th month, there is no charge
for redemption. Requests for redemption must be received at least ten (10) days
prior to the proposed date of redemption.
With respect to the Fund's trading, in general, the Fund's Advisors will
endeavor to trade only futures, forwards and options that have sufficient
liquidity to enable them to enter and close out positions without causing major
price movements. Notwithstanding the foregoing, most United States commodity
exchanges limit the amount by which certain commodities may move during a single
day by regulations referred to as "daily price fluctuation limits" or "daily
limits". Pursuant to such regulations, no trades may be executed on any given
day at prices beyond the daily limits. The price of a futures contract has
occasionally moved the daily limit for several consecutive days, with little or
no trading, thereby effectively preventing a party from liquidating its
position. While the occurrence of such an event may reduce or effectively
eliminate the liquidity of a particular market, it will not limit ultimate
losses and may in fact substantially increase losses because of this inability
to liquidate unfavorable positions. In addition, if there is little or no
trading in a particular futures or forward contract that the Fund is trading,
whether such illiquidity is caused by any of the above reasons or otherwise, the
Fund may be unable to execute trades at favorable prices and/or may be unable or
unwilling to liquidate its position prior to its expiration date, thereby
requiring the Fund to make or take delivery of the underlying interest of the
commodity.
In addition, certain Advisors trade on futures markets outside the United States
on behalf of the Fund. Certain foreign exchanges may be substantially more prone
to periods of illiquidity than United States exchanges. Further, certain
Advisors trade forward contracts which are not traded on exchanges; rather banks
and dealers act as principals in these markets. The Commodity Futures Trading
Commission does not regulate trading on non-U.S. futures markets or in forward
contracts.
SAFE HARBOR STATEMENT. The discussion above contains certain forward-looking
statements (as such term is defined in the rules promulgated under the
Securities Exchange Act of 1934, as amended) that are based on the beliefs of
the Fund, as well as assumptions made by, and information currently available
to, the Fund. A number of important factors should cause the Fund's actual
results, performance or achievements for 1999 and beyond to differ materially
from the results, performance or achievements expressed in, or implied by, such
forward-looking statements. These factors include, without limitation, the
factors described above.
PART II -- OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES
During the second quarter of 2000, 9,406.7966 Units were sold for a total of
$912,755.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS. Financial Data Schedule.
B. REPORTS ON FORM 8-K. None.
10
<PAGE>
SIGNATURES
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, on the 14th day of August, 2000.
KENMAR GLOBAL TRUST
By: Kenmar Advisory Corp.,
managing owner
By:
------------------------------
Kenneth A. Shewer
Chairman
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated on the 14th day of August, 2000.
KENMAR GLOBAL TRUST
By: Kenmar Advisory Corp.,
managing owner
By:
------------------------------
Kenneth A. Shewer
Chairman and Director
By:
------------------------------
Marc S. Goodman
President and Director
By:
------------------------------
Thomas J. DiVuolo
Senior Vice President
(Principal Financial and Accounting
Officer for the Fund)
11
