SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X Quarterly report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended June 30, 1996 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 0-16515
IDS MANAGED FUTURES, L.P.
(Exact name of registrant as specified in its charter)
Delaware 06-1189438
State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification #)
233 South Wacker Dr., Suite 2300, Chicago, IL 60606
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (312) 460-4000
Not Applicable
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
<TABLE>
Part I. Financial Information
Item 1. Financial Statements
Following are Financial Statements for the fiscal quarter ended June 30, 1996,
and the additional time frames as noted:
Fiscal Quarter Year to Date Fiscal Year Fiscal Quarter Year to Date
Ended 6/30/96 To 6/30/96 Ended 12/31/95 Ended 6/30/95 To 6/30/95
-------------- -------------- -------------- --------------------------
<S> <C> <C> <C> <C> <C>
Statement of
Financial Condition X X
Statement of
Operations X X X X
Statement of Changes
in Partners' Capital X
Statement of
Cash Flows X X
Notes to Financial
Statements X
IDS MANAGED FUTURES, L.P.
STATEMENTS OF FINANCIAL CONDITION
UNAUDITED
Jun 30, 1996 Dec 31, 1995
--------------- -------------
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ASSETS
Cash at Escrow Agent $0 $0
Equity in commodity futures
trading accounts:
Account balance 33,774,258 31,440,196
Unrealized gain on open
futures contracts 361,278 1,705,569
--------------- -------------
34,135,536 33,145,765
Interest receivable 119,059 130,109
Prepaid G.P. fee 223,534 0
--------------- -------------
Total assets $34,478,129 $33,275,874
=============== =============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accrued commissions on open
futures contracts due to AXP Advisors and $91,367 $66,688
Accrued management fee 85,475 97,719
Accrued incentive fee 30,063 33,129
Accrued operating expenses 36,434 141,246
Redemptions payable 256,756 370,419
Selling and Offering Expenses Payable 50,514 52,721
--------------- -------------
Total liabilities 550,609 761,922
Partners' Capital:
Limited partners ( 121,330.74 units 33,292,210 31,889,868
outstanding at 6/30/96, 118,310.38
units outstanding at 12/31/95) (see Note 1)
General partners (2,315.34 units outstanding 635,310 624,084
6/30/96 and 2,315.34 at 12/31/95) (see Note 1)
--------------- -------------
Total partners' capital 33,927,520 32,513,952
--------------- -------------
Total liabilities and
partners' capital $34,478,129 $33,275,874
=============== =============
In the opinion of management, these statements reflect all adjustments necessary
to fairly state the financial condition of IDS Managed Futures, L.P. (See Note 6)
IDS MANAGED FUTURES, L.P.
STATEMENTS OF OPERATIONS
UNAUDITED
Apr 1, 1996 Jan 1, 1996 Apr 1, 1995 Jan 1, 1995
through through through through
Jun 30, 1996 Jun 30, 1996 Jun 30, 1995 Jun 30, 1995
--------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
REVENUES
Gains on trading of commodity futures
and forwards contracts, physical
commodities and related options:
Realized gain (loss) on closed positions $1,819,261 $2,445,690 $4,744,867 $6,422,798
Change in unrealized gain (loss)
on open positions (1,012,048) (1,344,290) (3,492,917) (1,479,178)
Interest income 381,516 741,111 364,381 679,686
Foreign currency transaction gain (loss) (39,555) (85,958) 15,565 220,052
--------------- ------------- -------------- -------------
Total revenues 1,149,174 1,756,553 1,631,896 5,843,358
EXPENSES
Commissions paid to AXP Advisors and CIS 240,327 431,462 121,176 369,063
Exchange fees 6,850 12,697 4,888 9,889
Management fees 255,768 508,843 261,938 491,647
Incentive fees 30,212 32,294 114,343 416,712
General Partner fee to AXP Advisors and CIS 111,767 223,533 81,734 163,468
Operating expenses 11,478 (29,619) 33,651 99,258
--------------- ------------- -------------- -------------
Total expenses 656,401 1,179,210 617,729 1,550,037
--------------- ------------- -------------- -------------
Net profit (loss) $492,773 $577,343 $1,014,167 $4,293,321
=============== ============= ============== =============
PROFIT (LOSS) PER UNIT OF
PARTNERSHIP INTEREST $4.05 $4.85 $9.02 $38.38
=============== ============= ============== =============
(see Note 1) (see Note 1) (see Note 1) (see Note 1)
This Statement of Operations, in the opinion of management, reflects all adjustments
necessary to fairly state the financial condition of IDS Managed Futures, L. P. (See Note 6)
IDS MANAGED FUTURES, L.P.
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the period January 1, 1996 through June 30, 1996
UNAUDITED
Limited General
Units* Partners Partners Total
--------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Partners' capital at January 1, 1996 118,310.38 $31,889,868 $624,084 $32,513,952
Net profit (loss) 566,117 11,226 577,343
Additional Units Sold 8,529.02 2,583,600 0 2,583,600
(see Note 1)
Less Selling and Organizational Costs (231,304) 0 (231,304)
Redemptions (see Note 1) (5,508.66) (1,516,071) (1,516,071)
--------------- ------------- -------------- -------------
Partners' capital at June 30, 1996 121,330.74 $33,292,210 $635,310 $33,927,520
=============== ============= ============== =============
Net asset value per unit
January 1, 1996 (see Note 1) 269.54 269.54
Net profit (loss) per unit (see Note 1) 4.85 4.85
------------- --------------
Net asset value per unit
June 30, 1996 $274.39 $274.39
* Units of Limited Partnership interest.
This Statement of Changes in Partners' Capital, in the opinion of management, reflects all adjustments
necessary to fairly state the financial condition of IDS Managed Futures, L. P. (See Note 6)
IDS MANAGED FUTURES, L.P.
STATEMENTS OF CASH FLOWS
UNAUDITED
Jan 1, 1996 Jan 1, 1995
through through
Jun 30, 1996 Jun 30, 1995
--------------- -------------
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Cash flows from operating activities:
Net profit (loss) $577,343 $4,293,321
Adjustments to reconcile net profit
(loss) to net cash provided by
(used in) operating activities:
Change in assets and liabilities:
Unrealized gain (loss) on open
futures contracts 1,344,291 1,479,178
Interest receivable 11,050 (20,466)
Prepaid general partner fee (223,534) (163,468)
Accrued liabilities (95,443) 135,855
Redemptions payable (113,663) 81,912
Selling and Offering Expenses Payable (2,207) (83,746)
--------------- -------------
Net cash provided by (used in)
operating activities 1,497,837 5,722,586
Cash flows from financing activities:
Additional Units Sold 2,583,600 701,402
Selling and Offering Expenses (231,304) (80,754)
Partner redemptions (1,516,071) (972,114)
--------------- -------------
Net cash provided by (used in)
financing activities 836,225 (351,466)
--------------- -------------
Net increase (decrease) in cash 2,334,062 5,371,120
Cash at beginning of period 31,440,196 22,741,310
--------------- -------------
Cash at end of period $33,774,258 $28,112,430
=============== =============
This Statement of Cash Flows, in the opinion of management, reflects all adjustments
necessary to fairly state the financial condition of IDS Managed Futures, L. P. (See Note 6)
</TABLE>
IDS MANAGED FUTURES, L.P.
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
(1) GENERAL INFORMATION AND SUMMARY
IDS Managed Futures, L.P. (the "Partnership") is a limited
partnership organized on December 16, 1986 under the Delaware
Revised Uniform Limited Partnership Act. The Partnership was
formed to speculatively trade commodity interests, including
futures contracts, forward contracts, physical commodities, and
related options thereon pursuant to the trading instructions of
independent trading advisors. The General Partners of the
Partnership are CIS Investments, Inc. ("CISI") and IDS Futures
Corporation ("IDS Futures") (collectively, the "General
Partners"). The General Partners are registered commodity pool
operators under the Commodity Exchange Act, as amended (the "CE
Act") and are responsible for administering the business and
affairs of the Partnership exclusive of trading decisions. CISI
is an affiliate of Cargill Investor Services, Inc. ("CIS"), the
clearing broker for the Partnership. IDS Futures is an affiliate
of American Express Financial Advisors Inc. ("AXP Advisors"),
formerly IDS Financial Services Inc., which acts as the
Partnership's introducing broker and selling agent. Effective
January 1, 1995, IDS Financial Corporation, the parent company of
IDS Financial Services Inc., changed its name to American Express
Financial Corporation and IDS Financial Services Inc. changed its
name to American Express Financial Advisors Inc. These were
solely name changes; the management and structure of each company
did not change. Trading decisions for the Partnership are made
by two independent commodity trading advisors, John W. Henry &
Co., Inc. and Sabre Fund Management Limited.
Units of limited partnership interest ("Units") were offered
initially by AXP Advisors commencing March 27, 1987 and
concluding June 16, 1987. Subsequent offerings commenced March
29, 1993, January 31, 1994 and June 26, 1995. The total amount
of the initial offering was $7,500,000 and the total amount of
the combined reopenings was $80,000,000. Investors purchase
Units at the then current net asset value per Unit; investors
affiliated with the selling agent of the Partnership are not
required to pay selling commissions, and the current offering has
varied selling commission rates depending on the total dollar
amount of the investment. Therefore, the total number of Units
authorized for the Partnership is not determinable and therefore
is not disclosed in the financial statements.
The initial offering of Units was made pursuant to a
registration statement on Form S-18 and Prospectus declared
effective with the Securities and Exchange Commission ("SEC") on
March 27, 1987. The maximum sales allowed in the offering was
$7,500,000. By the end of the offering period, subscriptions for
29,442 Units (excluding the Units purchased by the initial
Limited Partner) had been accepted by the Partnership,
representing a total investment of $7,372,260. The minimum
subscription size was $5,000 or 20 Units for investors not
affiliated with AXP Advisors and $4,700 or 20 Units for
affiliated investors (affiliated investors did not have to pay
selling commissions of $15 per unit). In the case of
Individual Retirement Accounts and Keogh Plans the minimum
subscription size was $1,000 in most jurisdictions and $940 for
affiliated investors. In June 1987, $353,280 was paid to AXP
Advisors for selling commissions and $285,822 was reimbursed to
the General Partners for organization and offering expenses which
had been incurred on behalf of the Partnership. The trading
advisors commenced trading on June 16, 1987 with $6,733,158.
The Partnership was reopened to additional investment
pursuant to a registration statement on Form S-1 that was
declared effective with the SEC on March 29, 1993. The maximum
sales allowed in this additional offering was $10,000,000. The
minimum subscription size for the reopening was $1,000 for
investors not affiliated with AXP Advisors. On January 31, 1994,
a registration statement on Form S-1 was declared effective with
the SEC for purposes of offering $20,000,000 of Units in the
Partnership in addition to the unsold portion of the $10,000,000
of Units offered pursuant to the Prospectus dated March 29, 1993.
By December 31, 1994, a total of 25,571.16 Units
representing a total investment of $20,033,657 of limited
partnership interest had been sold in the combined offerings.
Selling commissions of $1,145,552 were paid to AXP Advisors by
the new limited partners. All new investors paid organization
and offering expenses totaling $1,202,003. During the period
from December 10, 1994 through December 31, 1994, subscriptions
for 974.05 Units representing a total investment of $701,402 of
limited partnership interest were received from investors which
were accepted into the Partnership as of January 31, 1995. These
were the final subscriptions received from investors before the
close of the offering. Selling commissions of $38,670 were paid
to AXP Advisors by the new limited partners and all new investors
paid organization and offering expenses totaling $42,084.
Commencing with the January 31, 1994 offering, the General
Partners modified the method in which they were reimbursed for
offering expenses that they advanced. All offering expenses
incurred in offering Units since March 29, 1993 were treated as a
single reimbursable amount. At the end of the offering (December
31, 1994), any excess of the aggregate Offering Expense charge
received by the General Partners over the actual offering
expenses advanced by them was rebated to those investors who
purchased Units during the entire offering since March 29, 1993.
Rebates were made pro rata based on the number of Units purchased
by each investor and were paid in cash. The payout to investors
equaled $671,399.88 and was paid to investors on approximately
April 1, 1995. Any rebate of less than $15 per investor,
however, was retained by the General Partners.
At the close of business on February 28, 1995 each Unit was
divided into three Units (a "3 for 1 split"), each of which has a
Net Asset Value per Unit equal to the previous Net Asset Value
per Unit divided by three. Accordingly, the total number of
Units outstanding tripled as of that date.
On June 26, 1995, a new registration statement on Form S-1
was declared effective with the SEC to register $50,000,000 of
Units in addition to the unsold portion of the $20,000,000
offered pursuant to the Prospectus dated January 31, 1994. The
minimum subscription size for the new offering is $1,000 for
investors not affiliated with AXP Advisors. By June 30, 1996, a
total of 26,712.28 Units representing a total investment of
$7,716,701 of limited partnership interest had been sold in the
new offering. Selling commissions of $440,008 were paid to AXP
Advisors by the new limited partners. All new investors paid
organization and offering expenses totaling $231,501.
The Offering Expense charged pursuant to the registration
statement effective June 26, 1995 was reduced to 3% from the 6%
which had been charged in the previous two offerings. No rebate
similar to that described above will be made for this current
offering.
No redemptions are permitted by a subscriber during the
first six months after he or she has been admitted to the
Partnership. Thereafter, a Limited Partner may cause any or all
of his or her Units to be redeemed by the Partnership effective
as of the last trading day of any month of the Partnership based
on the Net Asset Value per Unit on ten days written notice to the
General Partners. There are no additional charges to the
investors at redemption. The General Partners may declare
additional redemption dates upon notice to the Limited Partners.
Payment will be made within ten business days of the effective
date of the redemption. The Partnership's Restated and Amended
Limited Partnership Agreement contains a full description of
redemption and distribution procedures.
The Partnership shall be terminated on Dec. 31, 2006 if none
of the following occur prior to that date: (1) investors holding
more than 50 percent of the outstanding Units notify the General
Partners to dissolve the Partnership as of a specific date;
(2) withdrawal, removal, insolvency, bankruptcy, legal disability
or dissolution of the General Partners of the Partnership; (3)
bankruptcy or insolvency of the Partnership; (4) decrease in the
net asset value to less than $500,000; (5) the Partnership is
declared unlawful; or (6) the net asset value per Unit declines
to less than $125 per Unit and the General Partners elect to
withdraw from the Partnership.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting and reporting policies of the Partnership
conform to generally accepted accounting principles and to
general practices within the commodities industry. The following
is a description of the more significant of those policies which
the Partnership follows in preparing its financial statements.
Financial Accounting Standards Board ("FASB") Interpretation
No. 39 Reporting
Reporting in accordance with FASB Interpretation No. 39
("FIN 39") is not applicable to the Partnership and the
provisions of FIN 39 do not have any effect on the Partnership's
financial statements.
Revenue Recognition
Commodity futures contracts, forward contracts, physical
commodities and related options are recorded on the trade date.
All such transactions are reported on an identified cost basis.
Realized gains and losses are determined by comparing the
purchase price to the sales price when the trades are offset.
Unrealized gains and losses reflected in the statements of
financial condition represent the difference between original
contract amount and market value (as determined by exchange
settlement prices for futures contracts and related options and
cash dealer prices at a predetermined time for forward contracts,
physical commodities and their related options) as of the last
business day of the quarter end.
The Partnership earns interest on 100 percent of the
Partnership's average monthly cash balance on deposit with the
Clearing Broker at a rate equal to 90 percent of the average
90-day Treasury bill rate for U.S. Treasury bills issued during
that month.
Commissions
Brokerage commissions, National Futures Association fees,
and clearing and exchange fees are accrued on a round-turn basis
on open commodity futures contracts. The Partnership pays
commissions on trades executed on its behalf at a rate of $35 per
round turn contract to CIS which in turn reallocates $20 per
round turn contract to AXP Advisors, an affiliate of IDS Futures.
Foreign Currency Transactions
Trading accounts on foreign currency denominations are
susceptible to both movements on underlying contract markets as
well as fluctuation in currency rates. Foreign currencies are
translated into U.S. dollars for closed positions at an average
exchange rate for the quarter while quarter-end balances are
translated at the quarter-end currency rates. The impact of the
translation is reflected in the statement of operations.
Statements of Cash Flows
For purposes of the statements of cash flows, cash
represents cash on deposit with the Clearing Broker in commodity
futures trading accounts.
(3) FEES
Management fees are accrued and paid monthly, incentive fees
are accrued monthly and paid quarterly and General Partners'
administrative fees are paid annually and amortized monthly.
Trading decisions for the period of these financial statements
were made by John W. Henry & Co., Inc. ("JWH") and Sabre Fund
Management Limited ("Sabre"), the Partnership's Commodity Trading
Advisors ("CTAs"). Pursuant to an agreement between the
Partnership and JWH, JWH receives 1/3 of 1% of the month-end net
asset value of the Partnership under its management. Pursuant to
an agreement between the Partnership and Sabre dated December 26,
1995 and effective January 1, 1996, Sabre's monthly management
fee was reduced from 1/4 of 1% to 1/8 of 1% of the Partnership's
Net Asset Value subject to Sabre's trading performance. This
reduction in management fees will continue until such time that
the cumulative trading performance of Sabre reaches 40%. The
Partnership pays JWH a quarterly incentive fee of 15% and pays
Sabre a quarterly incentive fee of 18% of trading profits achieved
on the NAV of the Partnership allocated by the General Partners
to such Advisor's management.
The Partnership pays an annual administrative fee of 1.125%
and 0.25% of the beginning of the year net asset value of the
Partnership to IDS Futures and CISI, respectively.
(4) INCOME TAXES
No provision for Federal Income Taxes has been made in the
accompanying financial statements as each partner is responsible
for reporting income (loss) based on the pro rata share of the
profits or losses of the Partnership. The Partnership is
responsible for the Illinois Personal Property and Income Tax
based on the operating results of the Partnership. Such tax
amounted to $8,684 and $64,277 for the periods ended June 30,
1996 and June 30, 1995, respectively, and is included in
operating expenses in the Statement of Operations.
(5) FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK
The Partnership was formed to speculatively trade Commodity
Interests. It has commodity transactions and all of its cash on
deposit at its Clearing Broker at all times. In the event that
volatility of trading of other customers of the Clearing Broker
impaired the ability of the Clearing Broker to satisfy its
obligations to the Partnership, the Partnership would be exposed
to off-balance sheet risk. Such risk is defined in Statement of
Financial Accounting Standards No. 105 ("SFAS 105") as a credit
risk. To mitigate this risk, the Clearing Broker, pursuant to
the mandates of the Commodity Exchange Act, is required to
maintain funds deposited by customers relating to futures
contracts in regulated commodities in separate bank accounts
which are designated as segregated customers' accounts. In
addition, the Clearing Broker has set aside funds deposited by
customers relating to foreign futures and options in separate
bank accounts which are designated as customer secured accounts.
Lastly, the Clearing Broker is subject to the Securities and
Exchange Commission's Uniform Net Capital Rule which requires the
maintenance of minimum net capital of at least 4% of the funds
required to be segregated pursuant to the Commodity Exchange Act.
The Clearing Broker has controls in place to make certain that
all customers maintain adequate margin deposits for the positions
which they maintain at the Clearing Broker. Such procedures
should protect the Partnership from the off-balance sheet risk as
mentioned earlier. The Clearing Broker does not engage in
proprietary trading and thus has no direct market exposure.
The counterparty of the Partnership for futures contracts
traded in the United States and most non-U.S. exchanges on which
the Partnership trades is the Clearing House associated with the
exchange. In general, Clearing Houses are backed by the
membership and will act in the event of non-performance by one of
its members or one of the members' customers and as such should
significantly reduce this credit risk. In the cases where the
Partnership trades on exchanges on which the Clearing House is
not backed by the membership, the sole recourse of the
Partnership for nonperformance will be the Clearing House.
The Partnership holds futures and futures options positions
on the various exchanges throughout the world. The Partnership
does not trade over the counter contracts. As defined by SFAS
105, futures positions are classified as financial instruments.
SFAS 105 requires that the Partnership disclose the market risk
of loss from all of its financial instruments. Market risk is
defined as the possibility that future changes in market prices
may make a financial instrument less valuable or more onerous.
If the markets should move against all of the futures positions
held by the Partnership at the same time, and if the markets
moved such that the Trading Advisors were unable to offset the
futures positions of the Partnership, the Partnership could lose
all of its assets and the partners would realize a 100% loss.
The Partnership has contracts with two CTAs who make the trading
decisions. One of the CTAs trades a program diversified among
all commodity groups, while the other is diversified among
the various futures contracts in the financials and metals group.
Both CTAs trade on U.S. and non-U.S. exchanges. Such
diversification should greatly reduce this market risk. Cash was
on deposit with the Clearing Broker in each time period of the
financial statements which exceeded the cash requirements of the
Commodity Interests of the Partnership.
The following chart discloses the dollar amount of the
unrealized gain or loss on open contracts related to exchange
traded contracts for the Partnership as of June 30, 1996:
COMMODITY GROUP UNREALIZED GAIN/(LOSS)
AGRICULTURAL COMMODITIES (70,423)
FOREIGN CURRENCIES 19,200
STOCK INDICES 11,163
ENERGIES (1,848)
METALS 316,728
INTEREST RATE INSTRUMENTS 86,458
TOTAL 361,278
The range of maturity dates of these exchange traded open
contracts is July of 1996 to March of 1997. The average open
trade equity for period of January 1, 1996 to June 30, 1996 was
$1,482,262.
The margin requirement at June 30, 1996 was $3,970,023. To
meet this requirement, the Partnership had on deposit with the
Clearing Broker $30,856,170 in segregated funds and $3,279,454 in
secured funds.
(6) FINANCIAL STATEMENT PREPARATION
The interim financial statements are unaudited but reflect
all adjustments that are, in the opinion of management, necessary
to a fair statement of the results for the interim periods
presented. These adjustments consist primarily of normal
recurring accruals.
The results of operations for interim periods are not
necessarily indicative of the operating results to be expected
for the fiscal year.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operation
Fiscal Quarter ended June 30, 1996
The Partnership recorded a gain of $492,773 or $4.05 per
Unit for the second quarter of 1996. This compares to a profit
of $1,014,167 or $9.02 per Unit for the second quarter of 1995.
During the first quarter of 1996, the Partnership posted a gain
of $84,570 or $0.80 per Unit, which compares to a profit of
$3,279,154 or $29.36 per Unit for the first quarter of 1995.
Favorable positions in global currency and physical
commodity markets generated profits in the first and third months
of the quarter. The second month of the quarter saw losses in
metals and global interest rates. Overall, the second quarter
ended positively for the Partnership's accounts managed by John
W. Henry & Co., Inc. and Sabre Fund Management Limited. At June
30, 1996, John W. Henry & Co., Inc. was managing 61.5% of the
Partnership's assets and Sabre Fund Management Limited was
managing 38.5% of the Partnership's assets.
In April, crude oil prices continued to surge upwards as
refiners pushed to replenish record-low inventory levels. In the
agricultural sector, prices of wheat, corn and soybeans soared as
export demand remained strong. The currency markets saw
relatively high U.S. bond yields which attracted investors to the
U.S. dollar, thus strengthening the dollar against the German
mark and Swiss franc. The Partnership recorded a profit of
$1,161,096 or $9.48 per Unit in April.
In May, the grain and oilseed markets were volatile as
concerns over winter crops were replaced by reports of poor
planting conditions for spring crops. Crude oil prices succumbed
to political pressures and the expected impact on world oil
supplies of the long-anticipated U.N./Iraq oil agreement. In the
currency markets, the British pound declined to a two-year low
against the U.S. dollar early in the month, but rallied back by
the end of the month well ahead of the dollar as well as the
German mark. The Partnership recorded a loss of $840,378 or
$6.83 per Unit in May.
In June, the metals markets were impacted by repercussions
from the Sumitomo copper trading losses and by an increase in the
world supply of gold; the result of selling by central banks.
Crude oil prices reflected continued inventory shortages and the
renewal of tension in the Middle East. The U.S. dollar reached a
28-month high against the Japanese yen early in the month, but
ended lower at month's end as investors turned to higher yielding
European currencies. The Partnership recorded a profit of
$172,055 or $1.40 per Unit in June.
On May 16, 1996, William Dudley resigned as a Director of
IDS Futures Corporation, a General Partner of the Partnership.
Peter Anderson was elected as a Director of IDS Futures
Corporation on May 20, 1996. Wendell Halvorson will be appointed
as President and a Director of IDS Futures Corporation pending
approval with the National Futures Association, replacing Janis
E. Miller, who resigned as President and a Director of IDS
Futures Corporation on March 29, 1996.
On June 25, 1996, Henry Gjersdal, Jr. and Patrice Halbach
were each elected Assistant Secretary of CIS Investments, Inc., a
General Partner of the Partnership.
During the quarter, additional Units sold consisted of
3,866.82 limited partnership units; there were no general partner
units sold . Additional Units sold during the quarter
represented a total of $1,170,200 before the reduction of selling
commissions and organizational costs of $104,838. Investors
redeemed a total of 2, 775 Units during the quarter. At the end
of the quarter there were 123,646.08 Units outstanding (including
2,315.34 Units owned by the General Partners).
During the fiscal quarter ended June 30, 1996, the
Partnership had no credit exposure to a counterparty which is a
foreign commodities exchange which was material.
The Partnership currently only trades on recognized global
futures exchanges. In the event the Partnership begins trading
over the counter contracts, any credit exposure to a counterparty
which exceeds 10% of the Partnership's total assets will be
disclosed.
See Footnote 5 of the Financial Statements for procedures
established by the General Partners to monitor and minimize
market and credit risks for the Partnership. In addition to the
procedures set out in Footnote 5, the General Partners review on
a daily basis reports of the Partnership's performance, including
monitoring of the daily net asset value of the Partnership. The
General Partners also review the financial situation of the
Partnership's Clearing Broker on a monthly basis. The General
Partners rely on the policies of the Clearing Broker to monitor
specific credit risks. The Clearing Broker does not engage in
proprietary trading and thus has no direct market exposure which
provides the General Partners assurance that the Partnership will
not suffer trading losses through the Clearing Broker.
Fiscal Quarter ended June 30, 1995
The Partnership recorded a profit of $1,014,167 or $9.02 per
Unit for the second quarter of 1995. The first month of the
quarter was profitable with the strongest gains derived from
foreign currency markets. The next two months saw losses in
interest rates and foreign exchange. Overall, the second quarter
ended positively for the Partnership's accounts managed by John
W. Henry & Co., Inc. and Sabre Fund Management Limited.
The decline of the U.S. dollar continued in April, with the
U.S. dollar falling 19% against the Japanese yen, 15% against the
Swiss franc and 13% against the German mark. Therefore,
positions in the foreign currency and global interest rate
markets, including those of the United States, the United
Kingdom, France and Australia resulted in strong gains for the
Partnership. The Partnership recorded a profit of $1,296,375 or
$11.71 per Unit in April.
The fixed income markets in the U.S. rose steadily in May.
Behind this move were beliefs that the U.S. economy was slowing,
inflation is remained in check, and the federal reserve was
unlikely to raise interest rates again and would possibly lower
them in the next few months. Positions in U.S. and international
fixed income markets generated strong gains during the month, but
performance results in foreign exchange partially offset these
gains. As a result, the Partnership recorded a profit of
$532,948 or $4.83 per Unit in May.
The financial sector in the month of June was influenced by
economic and political uncertainties in several major countries,
specifically the U.S., Japan, Great Britain and Germany. The
global marketplace was also confronted with the mid-month G-7
meeting in Nova Scotia, the perception that the Bundesbank would
lower the discount and Lombard rates, and the continued
U.S.-Japan trade dispute. The failing Japanese economy and
problems in the banking sector contributed to the decline of the
Nikkei, which fell below 15,000 for the first time since August
1992. As a result of these uncertainties, the Partnership
recording a loss of $815,156 or $7.52 per Unit in June.
There were no additional Units sold during the quarter.
Investors redeemed a total of 3,063.91 Units during the quarter.
At the end of the quarter there were 107,664.51 Units outstanding
(including 1,934.10 Units owned by the General Partners).
Fiscal Quarter ended March 31, 1996
The Partnership recorded a gain of $84,570 or $0.80 per Unit
for the first quarter of 1996. The first month experienced gains
primarily as a result of profits in foreign exchange. The next
two months saw losses due to unprofitable currency positions and
losses in trading of stock indices and metals. The first quarter
ended positively for the Partnership's accounts managed by John
W. Henry & Co., Inc. and Sabre Fund Management Limited. At March
31, 1996, John W. Henry & Co., Inc. was managing 60.8% of the
Partnership's assets and Sabre Fund Management Limited was
managing 39.2% of the Partnership's assets.
In January, the primary influence on markets was the U.S.
dollar, which rose against most currencies and hit its highest
level in two years against the Japanese yen. Trading in foreign
exchange generated the majority of profits. Trading in stock
indexes was slightly profitable. The Partnership recorded a
profit of $1,324,808 or $10.98 per Unit in January.
In February, the U.S. dollar lost ground against the
Japanese yen, British pound, Swiss franc and German mark,
resulting in the Partnership giving back some of the profits
earned in January. The largest decline occurred in Japanese yen
positions. In the metals markets, subsiding inflation fears and
weakening demand pushed gold prices beneath the $400 threshold
reached only a month before. Trading in interest rates and stock
indexes was also unprofitable. The Partnership recorded a loss
of $1,188,721 or $9.76 per Unit in February.
In March, trading was volatile, reflecting investors'
confusion over the direction of the U.S. economy. In addition,
political tensions between China and Taiwan and "Mad Cow" disease
in Britain further added to economic uncertainties. Elections in
Australia, which put an end to 13 years of Labor Party rule,
boosted the Australian dollar to levels not seen in over 10
months. Trading in stock indices and metals was unprofitable.
As a result, the Partnership recorded a loss of $51,517 or $.42
per Unit in March.
On March 29, 1996, Janis E. Miller resigned as President and
a Director of IDS Futures Corporation, one of the General
Partners of the Partnership. Ms. Miller's replacement will be
appointed pending approval by the National Futures Association.
During the quarter, additional Units sold consisted of
4,662.19 limited partnership units; there were no general partner
units sold . Additional Units sold during the quarter
represented a total of $1,413,400 before the reduction of selling
commissions and organizational costs of $126,466. Investors
redeemed a total of 2,733.64 Units during the quarter. At the
end of the quarter there were 122,554.27 Units outstanding
(including 2,315.34 Units owned by the General Partners).
During the fiscal quarter ended March 31, 1996, the
Partnership had no credit exposure to a counterparty which is a
foreign commodities exchange which was material.
The Partnership currently only trades on recognized global
futures exchanges. In the event the Partnership begins trading
over the counter contracts, any credit exposure to a counterparty
which exceeds 10% of the Partnership's total assets will be
disclosed.
Fiscal Quarter ended March 31, 1995
The Partnership recorded a profit of $3,279,154 or $29.36
per Unit for the first quarter of 1995. The first month of the
year was difficult due in part to losses in global interest rates
and foreign exchange. However, the next two months saw
profitable trends in the financial markets. As a result, the
first quarter ended positively for the Partnership's accounts
managed by John W. Henry & Co., Inc. and Sabre Fund Management
Limited.
As a result of the 3-for-1 unit split on February 28, 1995,
the income (loss) per unit of partnership interest for January
and February as shown below was calculated by dividing the income
(loss) for each month by the Units outstanding for each month
times three in order to compare performance to the March income
(loss) per Unit.
In January the financial markets were impacted by
speculation regarding a possible Federal Reserve monetary
tightening as a further effort to moderate domestic economic
growth and inflation. The continued uncertainty regarding the
financial crisis in Mexico and possible ramifications of the
earthquake in Kobe, Japan also weighed on the financial markets.
Therefore, the Partnership recorded a loss of $725,716 or $6.68
per Unit (or $20.06 per Unit prior to the 3-for-1 split) in
January.
During the month of February, global political and financial
events, including the sudden demise of the British merchant bank,
Barings PLC, sent stock prices falling around the world and
investors rushing to safety in German marks and U.S. bonds. The
German mark benefited substantially from the uncertain state of
many world economies and gained steadily versus the U.S. and
other European currencies. There was a global lack of support
for the U.S. dollar as it declined against many European
currencies and sank to new postwar lows versus Japanese yen.
Long positions in foreign exchange and favorable positions in the
Japanese markets generated substantial gains for the Partnership.
As a result, the Partnership recorded a profit of $1,987,901 or
$17.85 per Unit (or $53.57 per Unit prior to the 3-for-1 split)
in February.
The decline in value of the U.S. dollar gained momentum and
accelerated in March. Market participants ignored efforts by
central bankers to support the dollar, including an unanticipated
move by the German Bundesbank to lower short term rates late in
March. By month end, the dollar reached yet another postwar low.
Positive performance during the month was dominated by strong
trends in foreign exchange. Gains in currency positions,
global interest rates and stock indexes resulted in the
Partnership recording a profit of $2,016,969 or $18.19 per Unit
in March.
The number of both limited and general partnership units
increased dramatically in the first quarter due largely to the
3-for-1 unit split on February 28, 1995. The 3-for-1 unit split
created an additional 72,932.75 limited partnership units and an
additional 1,289.40 general partner units. As a result of the
3-for-1 unit split, the profit (loss) per unit of partnership
interest as shown in the foregoing Statement of Operations and
the Statements of Changes in Partners' Capital was calculated by
dividing the January 1, 1995 Net Asset Value per Unit by three
for comparison purposes of performance to the March 31, 1995 Net
Asset Value per Unit (the January 1, 1995 Net Asset Value per
Unit was $657.24 per unit before the 3-for-1 split and $219.08
after the 3-for-1 split).
During the quarter, additional Units sold consist of 969.53
limited partnership units and 4.52 general partner units.
Additional Units sold during the quarter represent a total of
$701,402, before the reduction of selling commissions and
organizational costs of $80,754. Investors redeemed a total of
645.37 Units during the quarter. At the end of the quarter there
were 110,728.43 Units outstanding (including 1,934.10 Units owned
by the General Partners).
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
None
b) Reports on Form 8-K
None
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 and thereunto duly authorized.
IDS MANAGED FUTURES, L.P.
Date: August 13, 1996 By: CIS Investments, Inc.
One of its General Partners
By: /S/Donald J. Zyck
Donald J. Zyck,
Secretary & Treasurer
(Duly authorized officer
of the General Partner
and the Principal Financial
Officer of the General Partner)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from IDS Managed
Futures, L.P. for the second quarter of 1996 and is qualified in its entirety by
reference to such 10-Q.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1996
<CASH> 34,135,536
<SECURITIES> 0
<RECEIVABLES> 342,593
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 34,478,129
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 34,478,129
<CURRENT-LIABILITIES> 550,609
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 33,927,520
<TOTAL-LIABILITY-AND-EQUITY> 34,478,129
<SALES> 0
<TOTAL-REVENUES> 1,149,174
<CGS> 0
<TOTAL-COSTS> 656,401
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 492,773
<INCOME-TAX> 0
<INCOME-CONTINUING> 492,773
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 492,773
<EPS-PRIMARY> 4.05
<EPS-DILUTED> 4.05
</TABLE>
