Morgan Stanley Dean Witter Charter Series
Monthly Report
July 1999
Dear Limited Partner:
The Net Asset Value per Unit for each of the three Morgan Stanley Dean
Witter Charter Funds as of July 31, 1999 was as follows:
Funds N.A.V. % change for month
Charter Graham $ 9.37 -2.62%
Charter Millburn $10.20 -3.81%
Charter Welton $ 8.83 -4.18%
In Charter Graham, losses were recorded during July primarily from long
positions in the Canadian dollar as its value fell versus the U.S. dollar
and other major currencies due to sagging commodity prices, particularly
gold, and renewed concerns over Latin America's economic health.
Additional currency losses were incurred from short positions in the
British pound and the European common currency, the euro, as the value of
these currencies reversed their recent downward trend versus the U.S.
dollar due to bullish economic data out of Europe and inflationary
pressures out of the U.S. In other markets, losses were recorded from long
positions in U.S. stock index futures as domestic equity prices declined
during the latter half of the month due to increased inflationary concerns
after Federal Reserve Chairman Alan Greenspan said that the economy may be
growing fast enough to warrant a second interest rate increase later this
year. A portion of the Fund's overall losses for the month was offset by
gains recorded from short positions in European interest rate futures,
particularly German bond futures, as prices declined later in the month due
to optimism regarding the European economy. Additional profits were
recorded from short positions in gold futures as gold prices fell to 20-
year lows earlier in the month amid disappointment over low prices at the
U.K. gold auction and on speculation that central banks were unloading or
seeking to unload the precious metal, following the Bank of England's
example. Smaller gains were recorded from short cotton futures positions
as prices declined during the first half of July due to greatly improved
crop prospects and after the U.S. Agricultural Department estimated that
world output and exports would increase through the 1999-2000 season.
In Charter Millburn, losses were recorded during July from short Japanese
interest rate futures positions as prices moved higher earlier in the month
amid investors' fears that a strong yen might slow down that nation's
budding recovery. These losses were mitigated by gains recorded from short
positions in German interest rate futures as prices in this market declined
due to optimism regarding the European economy. In currencies, losses were
experienced from short positions in the Swiss franc and the European common
currency, the euro, as these currencies reversed their recent downward
trend versus the U.S. dollar due to bullish economic data out of Europe and
inflationary pressures in the U.S. In energies, losses were incurred from
short natural gas futures positions as prices increased due to a summer-
related increase in U.S. demand which more than offset gains from long
futures positions in oil products, as oil prices also increased due to
declining inventories. A portion of the Fund's overall losses for the
month was offset by gains from long Nikkei Index futures positions as the
Japanese benchmark index increased to a 22-month high due to optimism
regarding that country's economy. Additional gains were recorded from
short corn futures positions as prices fell during the first half of the
month on reports of favorable crop weather in the U.S. corn-belt.
In Charter Welton, losses were recorded during the month primarily from
long positions in Hang Seng Index futures as Hong Kong stock prices moved
lower due to rising tensions between China and Taiwan and a decline in
China's gross domestic product. Smaller losses were recorded in this
market complex from long positions in European stock index futures as
prices in these markets were pushed lower by the strength in the euro and
the weakness on Wall Street during the second half of the month. In
currencies, losses were incurred from short positions in the European
common currency, the euro, as well as the Swiss franc, as their values
reversed their downward trend versus the U.S. dollar due to bullish
economic data out of Europe and inflationary concerns in the U.S. These
losses were partially offset by gains recorded from short positions in
coffee futures as coffee prices slid lower due to increased supplies,
diminishing fears of impending frost damage to Brazilian crops and on
predictions of record harvests in Brazil next year. Additional profits
were recorded from short positions in European bond futures as prices
declined due to optimism regarding the European
<PAGE>
economy. Smaller gains were recorded from short positions in gold futures
as gold prices fell to a 20-year low earlier in the month amid
disappointment over low prices at the U.K. gold auction and on speculation
that central banks were unloading or seeking to unload the precious metal,
following the Bank of England's example.
Should you have any questions concerning this report, please feel free to
contact Demeter Management Corporation at Two World Trade Center, 62nd
Floor, New York , NY 10048, or your Morgan Stanley Dean Witter Financial
Advisor.
I hereby affirm, that to the best of my knowledge and belief, the
information contained in this report is accurate and complete. Past
performance is not a guarantee of future results.
Sincerely,
Robert E. Murray
President
Demeter Management Corporation
General Partner
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<TABLE>
MORGAN STANLEY DEAN WITTER CHARTER SERIES
Historical Fund Performance
Presented below is the percentage change in Net Asset Value per
Unit from inception-to-date for each Fund in the Morgan Stanley
Dean Witter Charter Series. PAST PERFORMANCE IS NOT NECESSARILY
INDICATIVE OF FUTURE RESULTS.
<CAPTION>
Charter Graham
Year Return
<S> <C>
1999 (5 months) -6.3%
Inception-to-Date Return: -6.3%
_________________________________________________________________
___________________________
Charter Millburn
Year Return
1999 (5 months) 2.0%
Inception-to-Date Return: 2.0%
_________________________________________________________________
___________________________
Charter Welton
Year Return
1999 (5 months) -11.7%
Inception-to-Date Return: -11.7%
_________________________________________________________________
___________________________
</TABLE>
<PAGE>
<TABLE>
Morgan Stanley Dean Witter Charter Series
Statements of Operations
For the Month Ended July 31, 1999
(Unaudited)
<CAPTION>
Morgan Stanley Dean Witter
Charter Graham L.P. Morgan Stanley Dean Witter Charter Millburn L.P.
Percent of
Percent of
July 1, 1999
July 1, 1999
Beginning
Beginning
Amount Net Asset Value Amount
Net Asset Value
$ % $
%
REVENUES
<S> <C> <C>
<C> <C>
Trading Profit (Loss):
Realized 143,382 1.26
275,228 1.85
Net change in unrealized (396,577) (3.48)
(780,759) (5.26)
Total Trading Results (253,195) (2.22)
(505,531) (3.41)
Interest Income (DWR) 39,438 0.35
51,422 0.35
Total Revenues (213,757) (1.87)
(454,109) (3.06)
EXPENSES
Brokerage fees (DWR) 66,512 0.58 86,595
0.58
Management fees 19,004 0.17 24,741
0.17
Total Expenses 85,516 0.75
111,336 0.75
NET LOSS (299,273) (2.62) (565,445)
(3.81)
Morgan Stanley Dean Witter Charter Series
Statements of Changes in Net Asset Value
For the Month Ended July 31, 1999
(Unaudited)
Morgan Stanley Dean Witter Charter Graham L.P. Morgan
Stanley Dean Witter Charter Millburn L.P.
Units Amount Per Unit Units
Amount Per Unit
$ $
$ $
<S> <C> <C> <C> <C>
<C> <C>
Net Asset Value,
July 1, 1999 1,185,447.797 11,402,054 9.62
1,400,312.538 14,844,702 10.60
Net Loss - (299,273) (0.25) -
(565,445) (0.40)
Redemptions (2,717.391) (25,462) 9.37
(5,025.126) (51,256) 10.20
Subscriptions 356,727.625 3,342,538 9.37
464,658.033 4,739,512 10.20
Net Asset Value,
July 31, 1999 1,539,458.031 14,419,857 9.37
1,859,945.445 18,967,513 10.20
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
Morgan Stanley Dean Witter Charter Series
Statements of Operations
For the Month Ended July 31, 1999
(Unaudited)
<CAPTION>
Morgan Stanley Dean
Witter Charter Welton L.P.
Percent of
July 1, 1999
Beginning
Amount Net Asset Value
$ %
REVENUES
<S> <C> <C>
Trading Profit (Loss):
Realized (388,740) (2.67)
Net change in unrealized (163,144) (1.12)
Total Trading Results (551,884) (3.79)
Interest Income (DWR) 53,239 0.36
Total Revenues (498,645) (3.43)
EXPENSES
Brokerage fees (DWR) 84,782 0.58
Management fees 24,223 0.17
Total Expenses 109,005 0.75
NET LOSS (607,650) (4.18)
Morgan Stanley Dean Witter Charter Series
Statements of Changes in Net Asset Value
For the Month Ended July 31, 1999
(Unaudited)
Morgan Stanley Dean Witter Charter Welton L.P.
Units Amount Per Unit
$ $
<S> <C> <C> <C>
Net Asset Value,
July 1, 1999 1,577,477.999 14,534,027 9.21
Net Loss - (607,650) (0.38)
Redemptions (2,708.559) (23,917) 8.83
Subscriptions 418,225.500 3,692,931 8.83
Net Asset Value,
July 31, 1999 1,992,994.940 17,595,391 8.83
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
Morgan Stanley Dean Witter Charter Series
Notes to Financial Statements
(Unaudited)
1. Summary of Significant Accounting Policies
Organization - Morgan Stanley Dean Witter Charter Graham L.P. ("Charter
Graham"), Morgan Stanley Dean Witter Charter Millburn L.P. ("Charter
Millburn"), and Morgan Stanley Dean Witter Charter Welton L.P. ("Charter
Welton") (individually, a "Partnership", or collectively, the
"Partnerships") are limited partnerships organized to engage in the
speculative trading of futures and forward contracts, options on futures
contracts on physical commodities and other commodity interests, including
foreign currencies, financial instruments, metals, energy and agricultural
products (collectively, "futures interests"). The general partner for each
Partnership is Demeter Management Corporation ("Demeter"). The non-
clearing commodity broker is Dean Witter Reynolds, Inc. ("DWR") and an
unaffiliated clearing commodity broker, Carr Futures Inc. ("Carr"),
provides clearing and execution services. Demeter and DWR are wholly-owned
subsidiaries of Morgan Stanley Dean Witter & Co.
Demeter is required to maintain a 1% minimum interest in the equity of each
Partnership and income (losses) are shared by the General and Limited
Partners based upon their proportional ownership interests.
Use of Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
Revenue Recognition - Futures interests are open commitments until
settlement date. They are valued at market and the resulting unrealized
gains and losses are reflected in income. Monthly, DWR credits each
Partnership with interest income on 100% of its average daily funds held in
its individual account at DWR at a rate equal to that earned by DWR on its
U.S. Treasury bill investments during such month. Carr also credits DWR
with the interest income earned with respect to the Partnership's Net
Assets maintained in trading accounts at Carr. DWR in turn credits the
Partnership with 100% of the interest income received from Carr. For
purposes of such interest payments, Net Assets do not include monies due
to the Partnership on forward contracts and other futures interests, but
not actually received.
Net Income (Loss) per Unit - Net income (loss) per Limited Partnership
interest ("Unit(s)") is computed using the weighted average number of Units
outstanding during the period.
Brokerage and Related Transaction Fees and Costs - Each Partnership pays a
flat-rate monthly brokerage fee of 1/12 of 7% of the Partnership's Net
Assets as of the first day of each month (a 7% annual rate). Such fee
covers all brokerage commissions, transaction fees and costs and ordinary
administrative and offering expenses.
Operating Expenses - The Partnerships incur monthly management fees and may
incur incentive fees. Demeter bears all other operating expenses.
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 each
Partnership's revenues and expenses for income tax purposes.
Distributions - Distributions, other than on redemptions of Units, are made
on a pro-rata basis at the sole discretion of Demeter. No distributions
have been made to date.
Continuing Offering - Units of each Partnership are offered at a price
equal to 100% of the Net Asset Value per Unit at monthly closings held as
of the last day of each month.
<PAGE>
Morgan Stanley Dean Witter Charter Series
Notes to Financial Statements
(Concluded)
Redemptions - Limited Partners may redeem some or all of their Units as of
the last day of the sixth month following the closing at which a person
first becomes a Limited Partner. Redemptions may only be made in whole
Units, with a minimum of 100 Units required for each redemption, unless a
Limited Partner is redeeming his entire interest in the Partnership.
Units redeemed on or prior to the last day of the twelfth month from the
date of purchase will be subject to a redemption charge equal to 2% of the
Net Asset Value of a Unit on the
Redemption Date. Units redeemed after the last day of the twelfth month
and on or prior to the last day of the twenty-fourth month from the date of
purchase will be subject to a redemption charge equal to 1% of the Net
Asset Value of a Unit on the Redemption Date. Units redeemed after the
last day of the twenty-fourth month from the date of purchase will not be
subject to a redemption charge.
Exchanges - On the last day of the first month which occurs more than 180
days after a person first becomes a Limited Partner in any of the
Partnerships, and at the end of each month thereafter, Limited Partners may
transfer their investment among the Partnerships (subject to certain
restrictions outlined in the Limited Partnership Agreement) without paying
additional charges.
Dissolution of the Partnership - Each Partnership will terminate on
December 31, 2035 or at an earlier date if certain conditions occur as
defined in the Partnership's Limited Partnership Agreement.
2. Related Party Transactions
Each Partnership pays brokerage fees to DWR for trades executed on its
behalf as described in Note 1. Each Partnership's cash is on deposit with
DWR and Carr in future interests trading accounts to meet margin
requirements as needed. DWR pays interest on these funds as described in
Note 1.
3. Trading Advisors
Demeter, on behalf of each Partnership, retains certain commodity trading
advisors to make all trading decisions for the Partnerships. The trading
advisors for each Partnership are as follows:
Morgan Stanley Dean Witter Charter Graham L.P.
Graham Capital Management L.P.
Morgan Stanley Dean Witter Charter Millburn L.P.
Millburn Ridgefield Corporation
Morgan Stanley Dean Witter Charter Welton L.P.
Welton Investment Corporation
Compensation to the trading advisors by the Partnerships consists of
management fees and incentive fees as follows:
Management Fee - Each Partnership pays a flat-rate monthly fee of 1/12 of
2% of the Net Assets under management by each trading advisor as of the
first day of each month (a 2% annual rate).
Incentive Fee - Each Partnership pays a monthly incentive fee equal to 20 %
of "Trading Profits", (as defined in the Limited Partnership agreements),
as of the end of each calendar month. When a trading advisor experiences
losses with respect to Net Assets as of the end of a calendar month, the
trading advisor must earn back such losses before that trading advisor is
eligible for an incentive fee in the future.
