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 number 0-13298
DEAN WITTER CORNERSTONE FUND II
(Exact name of registrant as specified in its charter)
New York 13-3212871
(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>
DEAN WITTER CORNERSTONE FUND II
INDEX TO QUARTERLY REPORT ON FORM 10-Q
June 30, 1998
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Statements of Financial Condition
June 30, 1998 (Unaudited) and December 31, 1997...........2
Statements of Operations for the Quarters Ended
June 30, 1998 and 1997 (Unaudited)........................3
Statements of Operations for the Six Months Ended
June 30, 1998 and 1997 (Unaudited)........................4
Statements of Changes in Partners' Capital for
the Six Months Ended June 30, 1998 and 1997
(Unaudited)...............................................5
Statements of Cash Flows for the Six Months Ended
June 30, 1998 and 1997 (Unaudited)........................6
Notes to Financial Statements (Unaudited)..............7-11
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations..............12-17
PART II. OTHER INFORMATION
Item 1. Legal Proceedings..................................18
Item 2. Changes in Securities and Use of Proceeds..........18
Item 6. Exhibits and Reports on Form 8-K...................
19
</TABLE>
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
DEAN WITTER CORNERSTONE FUND II
STATEMENTS OF FINANCIAL CONDITION
<CAPTION>
June 30, December 31,
1998 1997
$ $
(Unaudited)
ASSETS
<S> <C> <C>
Equity in Commodity futures trading accounts:
Cash 28,907,166 29,293,294
Net unrealized gain on open contracts 1,763,384 2,003,679
Total Trading Equity 30,670,550 31,296,973
Interest receivable (DWR) 100,800 106,167
Due from DWR 73,771 27,883
Total Assets 30,845,121 31,431,023
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable 220,487 199,022
Accrued management fees 102,351 104,350
Accrued incentive fees 78,138 618,270
Common administrative expenses payable 37,477 21,640
Total Liabilities 438,453 943,282
Partners' Capital
Limited Partners (7,657.634 and
7,967.401 Units, respectively) 29,567,255 29,677,943
General Partner (217.400 Units) 839,413 809,798
Total Partners' Capital 30,406,668 30,487,741
Total Liabilities and Partners' Capital 30,845,121 31,431,023
NET ASSET VALUE PER UNIT 3,861.15 3,724.92
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER CORNERSTONE FUND II
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Quarters Ended June 30,
1998 1997
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized 2,057,290 (650,484)
Net change in unrealized 715,897 (364,330)
Total Trading Results 2,773,187(1,014,814)
Interest Income (DWR) 290,794 308,278
Total Revenues 3,063,981 (706,536)
EXPENSES
Brokerage commissions (DWR) 357,353 373,812
Management fees 292,182 281,865
Incentive fees 78,138 (257,021)
Transaction fees and costs 32,267 32,684
Administrative expenses 11,152 10,297
Total Expenses 771,092 441,637
NET INCOME (LOSS) 2,292,889(1,148,173)
NET INCOME (LOSS) ALLOCATION
Limited Partners 2,229,930 (1,119,354)
General Partner 62,959 (28,819)
NET INCOME (LOSS) PER UNIT
Limited Partners 289.60 (132.56)
General Partner 289.60 (132.56)
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER CORNERSTONE FUND II
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Six Months Ended June 30,
1998 1997
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized 2,139,556 2,263,382
Net change in unrealized (240,295) (333,627)
Total Trading Results 1,899,261 1,929,755
Interest Income (DWR) 598,276 628,176
Total Revenues 2,497,537 2,557,931
EXPENSES
Brokerage commissions (DWR) 706,483 662,114
Management fees 587,455 566,449
Incentive fees 78,138 92,628
Transaction fees and costs 65,144 61,846
Administrative expenses 19,256 21,824
Total Expenses 1,456,476 1,404,861
NET INCOME 1,041,061 1,153,070
NET INCOME ALLOCATION
Limited Partners 1,011,446 1,127,331
General Partner 29,615 25,739
NET INCOME PER UNIT
Limited Partners 136.23 118.40
General Partner 136.23 118.40
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER CORNERSTONE FUND II
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the Six Months Ended June 30, 1998 and 1997
(Unaudited)
<CAPTION>
Units of
Partnership Limited General
Interest Partners Partner Total
<S> <C> <C> <C>
<C>
Partners' Capital,
December 31, 1996 9,205.342 $28,360,195 $685,975
$29,046,170
Offering of Units 91.201 304,200 -
304,200
Net Income - 1,127,331 25,739 1,153,070
Redemptions (775.483) (2,607,578) -
(2,607,578)
Partners' Capital,
June 30, 1997 8,521.060 $27,184,148 $711,714
$27,895,862
Partners' Capital,
December 31, 1997 8,184.801 $29,677,943 $809,798
$30,487,741
Offering of Units 8.044 29,966 -
29,966
Net Income - 1,011,446 29,615 1,041,0
61
Redemptions (317.811) (1,152,100) -
(1,152,100)
Partners' Capital,
June 30, 1998 7,875.034 $29,567,255 $839,413 $30
,406,668
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER CORNERSTONE FUND II
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
For the Six Months Ended June 30,
1998 1997
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net income 1,041,061 1,153,070
Noncash item included in net income:
Net change in unrealized 240,295 333,627
(Increase) decrease in operating assets:
Interest receivable (DWR) 5,367 3,668
Due from DWR (45,888) 93,708
Increase (decrease) in operating liabilities:
Accrued management fees (1,999) (5,258)
Accrued incentive fees (540,132) (246,483)
Common administrative expenses payable15,837 (14,550)
Accrued brokerage commissions (DWR)- (2,710)
Accrued transaction fees and costs -
696
Net cash provided by operating activities 714,541 1,315,768
CASH FLOWS FROM FINANCING ACTIVITIES
Offering of units 29,966 304,200
Increase (decrease) in redemptions payable21,465 (180,703)
Redemptions of units (1,152,100)(2,607,578)
Net cash used for financing activities (1,100,669)(2,484,081)
Net decrease in cash (386,128)(1,168,313)
Balance at beginning of period 29,293,294 28,509,266
Balance at end of period 28,907,166 27,340,953
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
DEAN WITTER CORNERSTONE FUND II
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 Dean Witter Cornerstone
Fund II (the "Partnership"). The financial statements and
condensed notes herein should be read in conjunction with the
Partnership's December 31, 1997 Annual Report on Form 10-K.
1. Organization
Dean Witter Cornerstone Fund II is a limited partnership
organized to engage in the speculative trading of commodity
futures contracts and forward contracts on foreign currencies
(collectively, "futures interests"). The Partnership is one of
the Dean Witter Cornerstone Funds, comprised of Dean Witter
Cornerstone Fund II, Dean Witter Cornerstone Fund III, and Dean
Witter Cornerstone Fund IV. The general partner is Demeter
Management Corporation ("Demeter"). The non-clearing commodity
broker is Dean Witter Reynolds Inc. ("DWR"), with an unaffiliated
broker, Carr Futures Inc. ("Carr"), providing clearing and
execution services. Both Demeter and DWR are wholly-owned
subsidiaries of Morgan Stanley Dean Witter & Co. ("MSDW"). The
trading advisors who make all trading decisions for the
Partnership are John W. Henry & Company, Inc. ("JWH") and
Northfield Trading L.P.
<PAGE>
DEAN WITTER CORNERSTONE FUND II
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
2. Related Party Transactions
The Partnership's cash is on deposit with DWR and Carr in
commodity trading accounts to meet margin requirements as needed.
DWR pays interest on these funds based on current 13-week U.S.
Treasury bill rates. Brokerage expenses incurred by the
Partnership are paid to DWR.
3. Financial Instruments
The Partnership trades futures and forward contracts in interest
rates, stock indices, commodities, and currencies. Futures and
forwards represent contracts for delayed delivery of an
instrument at a specific 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 and December 31, 1997, open
contracts were:
Contract or Notional Amount
June 30, 1998 December 31, 1997
$ $
Exchange-Traded Contracts
Financial Futures:
Commitments to Purchase 45,422,000 30,057,000
Commitments to Sell 7,218,000 13,539,000
Commodity Futures:
Commitments to Purchase 1,818,000 6,148,000
Commitments to Sell 13,913,000 15,082,000
Foreign Futures:
Commitments to Purchase 43,703,000 25,543,000
Commitments to Sell 46,423,000 20,799,000
Off-Exchange-Traded
Forward Currency Contracts
Commitments to Purchase 37,819,000 17,705,000
Commitments to Sell 73,791,000 46,518,000
<PAGE>
DEAN WITTER CORNERSTONE FUND II
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
A portion of the amounts indicated as off-balance-sheet risk in
forward currency contracts is due to offsetting forward
commitments to purchase and to sell the same currency on the same
date in the future. These commitments are economically
offsetting, but are not offset in the forward market until the
settlement date.
The net unrealized gains on open contracts are reported as a
component of "Equity in Commodity futures trading accounts" on
the Statements of Financial Condition and totaled $1,763,384 and
$2,003,679 at June 30, 1998 and December 31, 1997, respectively.
Of the $1,763,384 net unrealized gain on open contracts at June
30, 1998, $744,856 related to exchange-traded futures contracts
and $1,018,528 related to off-exchange-traded forward currency
contracts.
Of the $2,003,679 net unrealized gain on open contracts at
December 31, 1997, $1,675,343 related to exchange-traded futures
contracts and $328,336 related to off-exchange-traded forward
currency contracts.
Exchange-traded futures contracts held by the Partnership at June
30, 1998 and December 31, 1997 mature through June 1999 and
December 1998, respectively. Off-exchange-traded forward
currency contracts held by the Partnership at June 30, 1998 and
December
<PAGE>
DEAN WITTER CORNERSTONE FUND II
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
31, 1997 mature through September 1998 and March 1998,
respectively.
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 Statements of Financial Condition.
The Partnership also has credit risk because DWR and Carr 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 DWR and
Carr, as a futures commission merchant for the Partnership's
exchange-traded futures contracts, is required, pursuant to
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 on all open futures contracts, which
funds, in the aggregate, totaled $29,652,022 and $30,968,637 at
June 30, 1998 and December 31, 1997, respectively. With respect
to the Partnership's off-exchange-traded forward currency forward
<PAGE>
DEAN WITTER CORNERSTONE FUND II
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
contracts, there are no daily settlements of variations in value
nor is there any requirement that an amount equal to the net
unrealized gain on open forward contracts be segregated. With
respect to those off-exchange-traded forward currency contracts,
the Partnership is at risk to the ability of Carr, the sole
counterparty on all such contracts, to perform. Carr's parent,
Credit Agricole Indosuez, has guaranteed to the Partnership,
payment of the net liquidating value of the transactions in the
Partnership's account with Carr (including foreign currency
contracts).
For the six months ended June 30, 1998 and the year ended
December 31, 1997, the average fair value of financial
instruments held for trading purposes was as follows:
June 30, 1998
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 23,042,000 18,153,000
Commodity Futures 4,030,000 13,173,000
Foreign Futures 32,710,000 18,537,000
Off-Exchange-Traded Forward
Currency Contracts 44,433,000 66,146,000
December 31, 1997
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 32,004,000 25,556,000
Commodity Futures 14,417,000 12,696,000
Foreign Futures 26,042,000 10,396,000
Off-Exchange-Traded Forward
Currency Contracts 36,907,000 46,749,000
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity - The Partnership's assets are deposited with DWR, as
non-clearing broker and with Carr, as clearing broker 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 DWR and Carr 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 and exchanges 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 and
exchanges.
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 revenues including interest income of $3,063,981 and posted
a gain in Net Asset Value per Unit. The most significant gains
were recorded in the currency markets from short positions in the
South African rand as its value declined significantly relative to
the U.S. dollar during May and June, despite intervention by the
South African government during late June. Additional currency
gains were recorded from short Japanese yen positions during May
and June as the value of the yen trended sharply lower versus other
major currencies as questions remained regarding the stability of
the
<PAGE>
Japanese economy. In the energy markets, profits were recorded
from short crude oil futures positions as oil prices declined
throughout a majority of the quarter on reports of increasing
supplies. Additional gains were recorded in the soft commodities
markets from short positions in coffee futures as coffee prices
declined during all three months of the quarter. Smaller profits
were recorded from short sugar and corn futures positions as prices
in these markets moved lower during April and May. These gains
were partially offset by losses recorded in the financial futures
markets due to short-term price volatility in U.S. interest rate
futures during April and May and in Australian interest rate
futures during June. Smaller losses were recorded from long gold
futures positions during May as precious metals prices moved lower.
Total expenses for the three months ended June 30, 1998 were
$771,092, resulting in net income of $2,292,889. The value of an
individual Unit in the Partnership increased from $3,571.55 at
March 31, 1998 to $3,861.15 at June 30, 1998.
For the six months ended June 30, 1998, the Partnership recorded
total trading revenues including interest income of $2,497,537
and posted a gain in Net Asset Value per Unit. The most
significant gains were recorded in the currency markets from
short positions in the South African rand as its value declined
significantly relative to the U.S. dollar during May and June.
Additional currency gains were recorded from short Japanese yen
positions as the value of the yen also moved sharply lower versus
the U.S. dollar during May and June amid concerns about the
<PAGE>
Japanese economy. Additional profits were recorded in the energy
markets from short positions in crude oil futures as oil prices
moved lower throughout a majority of the first half of the year.
Smaller gains were recorded in soft commodities from short
positions in coffee and sugar futures as prices in these markets
moved downward during the second quarter. These gains were
partially offset by losses incurred in the financial futures
markets primarily from trading Nikkei Index futures as Japanese
equity prices moved in a short-term volatile pattern throughout
the first quarter amid uncertainty regarding an economic stimulus
package. Losses were also recorded from choppy price movement in
U.S. bond futures as domestic bond prices experienced trendless
movement throughout a majority of the first six months of the
year. Smaller losses were recorded in metals during January from
short gold futures positions as gold prices reversed higher after
trending lower in previous months. Losses were also recorded
from long gold futures positions during May as precious metals
prices moved lower. Total expenses for the six months ended June
30, 1998 were $1,456,476, resulting in net income of $1,041,061.
The value of an individual Unit in the Partnership increased from
$3,724.92 at December 31, 1997 to $3,861.15 at June 30, 1998.
For the Quarter and Six Months Ended June 30, 1997
For the quarter ended June 30, 1997, the Partnership recorded
total trading losses net of interest income of $706,536 and
posted a decrease in Net Asset Value per Unit. Losses were
recorded in the energy markets from trading crude oil futures as
oil prices moved in a short-term volatile pattern during the
quarter.
<PAGE>
Additional losses were recorded in the currency markets during
May from transactions involving the Japanese yen as its value
moved without consistent direction. Smaller losses were
experienced during May from short positions in the Singapore
dollar as its value increased relative to the U.S. dollar. Long
Japanese bond futures positions resulted in smaller losses as
prices moved lower During April. These losses were partially
offset by gains recorded from long positions in Australian
interest rate and global stock index futures as prices in these
markets moved higher during May and June. Additional gains were
recorded in the metals markets from short gold futures positions
as precious metals prices decreased during June. Smaller gains
were recorded in the soft commodities markets from long coffee
futures positions as coffee prices trended higher during April
and May. Total expenses for the three months ended June 30, 1997
were $441,637, resulting in a net loss of $1,148,173. The value
of an individual Unit in the Partnership decreased from $3,406.32
at March 31, 1997 to $3,273.76 at June 30, 1997.
For the six months ended June 30, 1997, the Partnership recorded
total trading revenues including interest income of $2,557,931
and posted an increase in Net Asset Value per Unit. The most
significant trading gains were recorded from a strong upward
trend in the value of the U.S. dollar versus most major world
currencies during January and February. Additional gains were
recorded from long coffee futures positions as prices trended
higher from January through May. In the metals markets, profits
were recorded from short gold futures positions as gold prices
moved sharply
<PAGE>
lower during January and June. Long positions in soybean and
corn futures resulted in additional profits as prices in these
markets trended higher during March. Additional gains were
recorded in these same markets during June from short positions
as prices moved lower. A portion of the Partnership's overall
gains was offset by losses recorded from trading crude oil
futures as oil prices moved in a short-term volatile pattern
throughout a majority of the first half of the year. Losses were
also recorded in the financial futures markets as global bond
futures prices moved in a trendless pattern during the second
quarter. Gains recorded during May and June from long positions
in Australian interest rate futures and global stock index
futures, as prices in these markets trended higher, helped to
mitigate a portion of these losses. Total expenses for the six
months ended June 30, 1997 were $1,404,861, resulting in net
income of $1,153,070. The value of an individual Unit in the
Partnership increased from $3,155.36 at December 31, 1996 to
$3,273.76 at June 30, 1997.
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
Previously reported. See Form 10-Q for the quarter ended March
31, 1998.
Item 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
Dean Witter Cornerstone Fund I ("Cornerstone I"), the Partnership,
and Dean Witter Cornerstone III ("Cornerstone III") collectively
registered 250,000 Units of Limited Partnership Interest ("Units")
pursuant to a Registration Statement on Form S-1, which became
effective on May 31, 1984 (the "Registration Statement") (SEC File
Numbers 2-88587; 88587-01; 88587-02). As contemplated in the
Registration Statement, an additional fund, Dean Witter Cornerstone
Fund IV ("Cornerstone IV" and collectively with Cornerstone I, the
Partnership and Cornerstone III, the "Cornerstone Funds") was
registered pursuant to Post-Effective Amendment No. 5 to the
Registration Statement, which became effective on February 6, 1987.
The managing underwriter for the Cornerstone Funds is DWR.
The offering for the Partnership originally commenced on May 31,
1984 and currently continues, with 41,701.582 Units sold through
June 30, 1998. The Cornerstone Funds have sold an aggregate of
235,407.756 Units, leaving 14,592.244 Units remaining available for
sale as of July 1, 1998.
The aggregate price of Units sold through June 30, 1998 with
respect to the Partnership is $65,634,485.
<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.
Dean Witter Cornerstone Fund II
(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 Dean
Witter Cornerstone Fund II and is qualified in its entirety by
reference to such financial instruments.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> JUN-30-1998
<CASH> 28,907,166
<SECURITIES> 0
<RECEIVABLES> 174,571<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 30,845,121<F2>
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 30,845,121<F3>
<SALES> 0
<TOTAL-REVENUES> 2,497,537<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,456,476
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,041,061
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,041,061
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,041,061
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Receivables include due from DWR of $73,771 and interest receivable
of $100,800.
<F2>In addition to cash and receivables, total assets include net unrealized
gain on open contracts of $1,763,384.
<F3>Liabilities include redemptions payable of $220,487, accrued management
fees of $102,351, accrued incentive fees of $78,138 and common administrative
expenses payable of $37,477.
<F4>Total revenue includes realized trading revenue of $2,139,556, net
change in unrealized of $(240,295) and interest income of $598,276.
</FN>
</TABLE>
