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 June 30, 1998 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 No. 0-24035
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3968008
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification
No.)
c/o Demeter Management Corporation
Two World Trade Center, 62 Fl. New York, NY 10048
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 392-5454
_________________________________________________________________
_
(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
<PAGE>
<TABLE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
June 30, 1998
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Statement of Financial Condition June 30, 1998
(Unaudited).......................................... 2
Statement of Operations for the Quarter Ended
June 30, 1998 (Unaudited)............................ 3
Statement of Operations for the Six Months Ended
June 30, 1998 (Unaudited)............................ 4
Statement of Changes in Partners' Capital for the
Six Months Ended June 30, 1998 (Unaudited)............5
Statement of Cash Flows for the Six Months Ended
June 30, 1998 (Unaudited)............................ 6
Notes to Financial Statements (Unaudited)..........7-14
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations..15-18
Part II. OTHER INFORMATION
Item 1. Legal Proceedings.................................19
Item 2. Change in Securities and Use of Proceeds.......19-20
Item 6. Exhibits and Reports on Form 8-K..................21
</TABLE>
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
STATEMENT OF FINANCIAL CONDITION
<CAPTION>
June 30,
1998
$
(Unaudited)
ASSETS
<S> <C>
Equity in Commodity futures trading accounts:
Cash
32,864,359
Net unrealized loss on open contracts
(1,569,180)
Total Trading Equity
31,295,179
Investment in U.S. Treasury Bills
3,090,088
Interest receivable (MS & Co.)
102,859
Total Assets
34,488,126
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable
190,150
Accrued brokerage fees (MS & Co. and MSIL)
107,741
Accrued management fee payable (MSCM)
73,795
Service fee payable (Demeter)
29,518
Total Liabilities
401,204
Partners' Capital
Limited Partners (4,019,096.762 Units)
33,722,805
General Partner (43,395.648 Units)
364,117
Total Partners' Capital
34,086,922
Total Liabilities and Partners' Capital
34,488,126
NET ASSET VALUE PER UNIT
8.39
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
STATEMENT OF OPERATIONS
(Unaudited)
<CAPTION>
For the
Quarter Ended
June 30, 1998
$
REVENUES
<S> <C>
Trading profit (loss):
Realized (2,745,450)
Net change in unrealized (1,666,740)
Total Trading Results (4,412,190)
Interest Income (MS & Co.) 373,684
Total Revenues (4,038,506)
EXPENSES
Brokerage fees (MS & Co. and MSIL) 342,234
Management fee (MSCM) 234,407
Service fee (Demeter) 93,763
Total Expenses 670,404
NET LOSS (4,708,910)
NET LOSS ALLOCATION
Limited Partners (4,658,918)
General Partner (49,992)
NET LOSS PER UNIT
Limited Partners
(1.15)
General Partner
(1.15)
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
STATEMENT OF OPERATIONS
(Unaudited)
<CAPTION>
For the
Six Months Ended
June 30, 1998
$
REVENUES
<S> <C>
Trading profit (loss):
Realized (4,123,450)
Net change in unrealized (1,569,180)
Total Trading Results (5,692,630)
Interest Income (MS & Co.) 686,806
Total Revenues (5,005,824)
EXPENSES
Brokerage fees (MS & Co. and MSIL) 619,807
Management fee (MSCM) 424,525
Service fee (Demeter) 169,810
Total Expenses 1,214,142
NET LOSS (6,219,966)
NET LOSS ALLOCATION
Limited Partners (6,154,083)
General Partner (65,883)
NET LOSS PER UNIT
Limited Partners
(1.61)
General Partner
(1.61)
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
For the Six Months Ended June 30, 1998
(Unaudited)
<CAPTION>
Units of
Partnership Limited General
Interest Partners Partner Total
<S> <C> <C> <C> <C>
Partners' Capital
January 2, 1998
(commencement of operations)200.000 $1,000 $1,000 $2,000
Initial Offering 2,573,486.803 25,475,868 259,000
25,734,868
Offering of Units 1,515,212.328 14,623,350 170,000
14,793,350
Net Loss - (6,154,083) (65,883)
(6,219,966)
Redemptions (26,406.721) (223,330) -
(223,330)
Partners' Capital
June 30, 1998 4,062,492.410 $33,722,805 $364,1
17 $34,086,922
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
STATEMENT OF CASH FLOWS
(Unaudited)
<CAPTION>
For the
Six Months Ended
June 30, 1998
$
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C>
Net loss
(6,219,966)
Noncash item included in net loss:
Net change in unrealized
1,569,180
Increase in operating assets:
Investment in U.S. Treasury Bills
(3,090,088)
Interest receivable (MS & Co.)
(102,859)
Increase in operating liabilities:
Accrued brokerage fees (MS & Co. and MSIL)
107,741
Accrued management fee payable (MSCM)
73,795
Service fee payable (Demeter)
29,518
Net cash used for operating activities
(7,632,679)
CASH FLOWS FROM FINANCING ACTIVITIES
Initial offering 2
5,736,868
Offering of Units 1
4,793,350
Increase in redemptions payable
190,150
Redemptions of units
(223,330)
Net cash provided by financing activities
40,497,038
Net increase in cash
32,864,359
Balance at beginning of period
- -
Balance at end of period
32,864,359
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
The financial statements include, in the opinion of management,
all adjustments necessary for a fair presentation of the results
of operations and financial condition of Morgan Stanley Tangible
Asset Fund L.P. (the "Partnership").
1. Summary of Significant Accounting Policies
Organization - Morgan Stanley Tangible Asset Fund L.P. is a
limited partnership organized to engage primarily in speculative
trading of futures contracts in metals, energy and agricultural
markets, (collectively, "futures interests"), and commenced
operations on January 2, 1998. The general partner is Demeter
Management Corporation ("Demeter"). The commodity brokers are
Morgan Stanley & Co. Incorporated ("MS & Co.") and Morgan Stanley
& Co. International Limited ("MSIL"), (collectively, the
"Commodity Brokers"). The trading advisor is Morgan Stanley
Commodities Management, Inc. ("MSCM", or the "Trading Advisor").
The selling agent is Dean Witter Reynolds Inc. ("DWR"). MSCM,
DWR, the Commodity Brokers and Demeter are wholly-owned
subsidiaries of Morgan Stanley Dean Witter & Co. ("MSDW").
Demeter is required to maintain a 1% minimum interest in the
equity of the Partnership and income (losses) are shared by
Demeter and the limited partners based upon their proportional
ownership interests.
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Basis of Accounting - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts in the financial statements.
Revenue Recognition - MS & Co. credits the Partnership at each
month-end with interest income as if 80% of the Partnership's
average daily "Net Assets", as defined in the Limited Partnership
Agreement, for the month were invested at a rate based on U.S.
Treasury bills. For purposes of such interest payments, Net
Assets do not include monies due to the Partnership on or with
respect to futures interests but not actually received.
Net Income (Loss) per Unit - Net income (loss) per Unit is
computed using the weighted average number of units outstanding
during the period.
Equity in Commodity Futures Trading Accounts - The Partnership's
asset "Equity in Commodity futures trading accounts" consists of
cash on deposit at MS & Co. and MSIL to be used as margin for
trading and the net asset or liability related to unrealized
gains or losses on open contracts.
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Brokerage and Related Transaction Fees and Costs - Brokerage
fees are accrued at a monthly rate of 1/12 of 3.65% of Net Assets
as of the first day of each month (a 3.65% annual rate). Such
fees are for all costs of executing trades by the Partnership,
including floor brokerage fees, exchange fees, clearing house
fees, NFA fees, "give-ups" or transfer fees and any costs
associated with taking delivery of commodities.
Service Fee - The Partnership pays Demeter a monthly service fee
equal to 1/12 of 1% per month (a 1% annual rate) of the
Partnership's Net Assets as of the first day of each month.
Operating Expenses - The Partnership incurs monthly management
fees and may incur incentive fees as described in Note 2. All
administrative expenses are borne by Demeter.
Income Taxes - No provision for income taxes has been made in the
accompanying financial statements, as partners are individually
responsible for reporting income or loss based upon their
respective share of the Partnership's revenues and expenses for
income tax purposes.
Distributions - Distributions, other than on redemption of Units,
are made on a pro-rata basis at the sole discretion of Demeter.
No distributions have been made to date.
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Offering of Units - The Partnership, Demeter, MSCM and DWR have
agreed to extend the Offering Period for those Units already
registered with the SEC but still unsold, until no later than
October 16, 1998. The remaining unsold Units are being offered
to the public at a price equal to 100% of the Net Asset Value as
of the close of business on the last day of each month
immediately preceding the closings currently scheduled to be held
on August 3, 1998 and September 1, 1998.
Redemptions - Limited Partners may redeem some or all of their
Units at 100% of the Net Asset Value Per Unit effective as of the
last day of the sixth month following the closing at which a
person first becomes a Limited Partner, upon five business days
advance notice by redemption form to Demeter. Thereafter, Units
may be redeemed as of the end of any month upon five business
days advance notice by redemption form to Demeter. However, any
Units redeemed at or prior to the last day of the eleventh month
after such Units were purchased will be subject to a redemption
charge equal to 2% of the Net Asset Value of a Unit on the date
of such redemption. Units redeemed after the last day of the
eleventh month and on or prior to the last day of the twenty-
fourth month after which such Units were purchased, will be
subject to a redemption charge equal to 1% of the Net Asset Value
per Unit on the date of such redemption. Units redeemed after
the last day of the twenty-fourth month after which such Units
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
were purchased will not be subject to a redemption charge.
Limited Partners who obtained their units via an exchange from
another DWR-sponsored commodity pool are not subject to the six
month holding period or the redemption charges.
Dissolution of the Partnership - The Partnership will terminate
on December 31, 2027 or at an earlier date if certain conditions
occur as defined in the Partnership's Limited Partnership
Agreement.
2. Related Party Transactions
The Partnership pays brokerage commissions to the Commodity
Brokers and a service fee to Demeter as described in Note 1. The
Partnership's cash is on deposit with MS & Co. and MSIL in
commodity trading accounts to meet margin requirements as needed.
MS & Co. pays interest on these funds as described in Note 1.
Compensation to the Trading Advisor by the Partnership consists
of a management fee and an incentive fee as follows:
Management Fee - The management fee is accrued at the rate of
5/24 of 1% of the Net Assets on the first day of each month (a
2.5% annual rate).
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Incentive Fee - The Partnership will pay an annual incentive fee
equal to 20% of the "Trading Profits" as defined in the Limited
Partnership Agreement, as of the end of each calendar year. Such
incentive fee is accrued in each month in which Trading Profits
occur. In those months in which trading profits are negative,
previous accruals, if any, during the incentive period will be
reduced. Any accrued incentive fees with respect to Units
redeemed at the end of a month that is not the end of a calendar
year will be deducted and paid to the Trading Advisor at the time
of such redemption.
3. Financial Instruments
The Partnership trades futures contracts in metals, energy and
agricultural markets. 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. At June 30, 1998, open
contracts were:
Contract or
Notional Amount
June 30, 1998
$
Exchange-Traded Contracts
Commodity Futures:
Commitments to Purchase 36,559,000
Foreign Futures:
Commitments to Purchase 7,246,000
Commitments to Sell 560,000
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The net unrealized loss on open contracts is reported as a
component of "Equity in Commodity futures trading accounts" on
the Statement of Financial Condition and totaled $(1,569,180) at
June 30, 1998.
The entire $1,569,180 net unrealized loss on open contracts at
June 30, 1998 related to exchange-traded futures contracts.
Exchange-traded futures contracts held by the Partnership at June
30, 1998 mature through December 1998.
The contract amounts in the above table represent the
Partnership's extent of involvement in a particular class of
financial instrument, but not the credit risk associated with
counterparty non-performance. The credit risk associated with
these instruments is limited to the amounts reflected in the
Partnership's Statement of Financial Condition.
The Partnership also has credit risk because MS & Co. and MSIL
act as the futures commission merchants or the counterparties,
with respect to most of the Partnership's assets. Exchange-traded
futures contracts are marked to market on a daily basis, with
variations in value settled on a daily basis. Each of MS & Co.
and MSIL, as a futures commission merchant for the Partnership's
exchange-traded futures contracts, are required, pursuant to
<PAGE>
MORGAN STANLEY TANGIBLE ASSET FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
regulations of the Commodity Futures Trading Commission ("CFTC"),
to segregate from their own assets and for the sole benefit of
their commodity customers, all funds held by them with respect to
exchange-traded futures contracts, including an amount equal to
the net unrealized gain(loss) on all open futures contracts,
which funds, in the aggregate, totaled $31,295,179 at June 30,
1998.
For the six months ended June 30, 1998, the average fair value of
financial instruments held for trading purposes was as follows:
June 1998
Assets Liabilities
$ $
Exchange-Traded Contracts:
Commodity Futures 33,948,000 -
Foreign Futures 6,955,000 731,000
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity - The Partnership's assets are deposited with MS & Co.
and MSIL, the Commodity Brokers, in separate futures interest
trading accounts and are used by the Partnership as margin to
engage in futures interest trading. Such assets are held in
either non-interest bearing bank accounts or in securities
approved by the CFTC for investment of customer funds. The
Partnership's assets held by MS & Co. and MSIL may be used as
margin solely for the Partnership's trading. Since the
Partnership's sole purpose is to trade in futures interests, it
is expected that the Partnership will continue to own such liquid
assets for margin purposes.
The Partnership's investment in futures interests may be
illiquid. If the price of a futures contract for a particular
commodity has increased or decreased by an amount equal to the
"daily limit," positions in the commodity can neither be taken
nor liquidated unless traders are willing to effect trades at or
within the limit. Commodity futures prices have occasionally
moved the daily limit for several consecutive days with little or
no trading. Such market conditions could prevent the Partnership
from promptly liquidating its commodity futures positions 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
<PAGE>
prevent the Partnership from trading in potentially profitable
markets or prevent the Partnership from promptly liquidating
unfavorable positions in such markets and subjecting it to
substantial losses. Either of these market conditions could
result in restrictions on redemptions.
Capital Resources. The Partnership does not have, nor does it
expect to have, any capital assets. Redemptions, exchanges and
sales of additional Units of Limited Partnership interest in the
future will affect the amount of funds available for investment
in futures interests in subsequent periods. Since they are at
the discretion of Limited Partners, it is not possible to
estimate the amount and therefore, the impact of future
redemptions, exchanges or sales of additional Units.
Results of Operations
For the Quarter and Six Months Ended June 30, 1998
For the quarter ended June 30, 1998, the Partnership recorded
total trading losses net of interest income of $4,038,506 and
posted a decrease in Net Asset Value per Unit. The most
significant losses were recorded in the energy and metals
markets. In the energy markets, the Partnership's long-only
trading approach resulted in losses throughout the quarter from
trading crude oil, heating oil and natural gas futures as oil and
gas prices continued to move lower on reports of abundant
inventory. In the metals markets, losses were recorded from long
positions in silver and platinum futures as precious metals
declined during the
<PAGE>
quarter. Additional losses were experienced from long aluminum,
copper and nickel futures as base metal prices also moved lower
during May and June. Losses were recorded in the agricultural
markets during April and May from long positions in wheat and
corn futures as prices in these markets decreased. In soft com-
modities, losses were experienced from long coffee futures
positions as prices declined during April and June. A portion of
these losses was offset by gains recorded during May and June
from long positions in cotton futures as cotton prices moved
higher. Total expenses for the three months ended June 30, 1998
were $670,404, resulting in a net loss of $4,708,910. The value
of an individual Unit in the Partnership decreased from $9.54 at
March 31, 1998 to $8.39 at June 30, 1998.
For the six months ended June 30, 1998, the Partnership recorded
total trading losses net of interest income of $5,005,824 and
posted a decrease in Net Asset Value per Unit. The most
significant losses were recorded in the energy markets throughout
the first half of the year as long positions in oil and gas
futures resulted in losses for the Partnership despite a brief
spike higher during the month of March. In the metals markets,
losses recorded during the second quarter from long positions in
precious and base metals futures more than offset profits
recorded during the first quarter from long silver, gold and
platinum futures. Additional losses were recorded for the
Partnership from long positions in corn and wheat futures as
grain prices moved lower between the months of February and May
before spiking higher in June. Smaller losses were recorded from
<PAGE>
long positions in livestock futures during both the first and
second quarter. In soft commodities, losses were recorded during
much of the first six months from long positions in coffee
futures as prices moved lower. A portion of these losses was
offset by gains recorded during the second quarter from long
positions in cotton and orange juice futures. Total expenses for
the six months ended June 30, 1998 were $1,214,142, resulting in
a net loss of $6,219,966. The value of an individual Unit in the
Partnership decreased from $10.00 at the inception of trading on
January 2, 1998 to $8.39 at June 30, 1998.
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
Previously reported. See Form 10-Q for the quarter ended March
31, 1998.
Item 2. CHANGE IN SECURITIES AND USE OF PROCEEDS
The Partnership registered 5,000,000 Units of Limited Partnership
Interest ("Units") pursuant to a Registration Statement on Form
S-1, which became effective on November 10, 1997 (the
"Registration Statement") (SEC File Number 333-33975). The
Partnership, Demeter, MSCM and DWR agreed to extend the offering
period for unsold Units until no later than October 16, 1998
pursuant to Post Effective Amendment No. 1 to the Registration
Statement, which became effective on July 10, 1998.
The offering originally commenced on November 10, 1997 with
4,045,503.483 Units sold through April 1, 1998. The aggregate
price of the offering amount registered was $50,000,000 (based
upon the initial offering price of $10.00 per Unit) for the
initial closing on January 2, 1998 (the "Initial Offering").
After the Initial Offering, Units were sold at three closings
held on February 2, March 2 and April 1, 1998, at a price equal
to 100% of the Net Asset Value per Unit at the close of business
on the last day of the month immediately preceding the closing.
The aggregate price of the Units sold at the four closings of the
offering was $40,100,218 (based upon the Net Asset Value per Unit
of $10.00 at January 2, 1998, $10.13 at February 2, 1998, $9.53
<PAGE>
at March 2, 1998 and $9.54 at April 1, 1998 closings,
respectively).
The 954,496.517 Units remaining unsold are being offered to the
public at a price equal to 100% of the Net Asset Value as of the
close of business on the last day of each month immediately
preceeding the closings currently scheduled to be held on August
3, 1998 and September 1, 1998.
No expenses chargeable against proceeds were incurred, making net
offering proceeds $40,100,218, which were applied to the working
capital of the Partnership for use in accordance with the "Use of
Proceeds" section of the Prospectus included as part of the
Registration Statement.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
Reports on Form 8-K. - No such reports have been
filed for the quarter ended June 30, 1998.
<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 Tangible Asset
Fund L.P.(Registrant)
By: Demeter Management Corporation
(General Partner)
August 12, 1998 By: /s/ Lewis A. Raibley, III
Lewis A. Raibley, III
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.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from Morgan
Stanley Tangible Asset Fund L.P. and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 32,864,359
<SECURITIES> 3,090,088
<RECEIVABLES> 102,859<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 34,488,126<F2>
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 34,488,126<F3>
<SALES> 0
<TOTAL-REVENUES> (5,005,824)<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,214,142
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (6,219,966)
<INCOME-TAX> 0
<INCOME-CONTINUING> (6,219,966)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6,219,966)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Receivables include interest receivable of $102,859.
<F2>In addition to cash, securities and receivables, total assets include
net unrealized loss on open contracts of $(1,569,180).
<F3>Liabilities include accrued brokerage fees of $107,741, accrued management
fee payable of $73,795, service fee payable of $29,518, and redemptions
payable of $190,150.
<F4>Total revenue includes realized trading revenue of $(4,123,450), net
change in unrealized of $(1,569,180) and interest income of $686,806.
</FN>
</TABLE>
