<PAGE>
IDS MANAGED FUTURES, L.P.
SUPPLEMENT NO. 1 DATED FEBRUARY 1, 1999 TO THE PROSPECTUS
DATED MAY 1, 1998--THE "PROSPECTUS"--FOR THE SALE OF $50,000,000
OF UNITS OF LIMITED PARTNERSHIP INTEREST
- --------------------------------------------------------------------------------
THIS SUPPLEMENT NO. 1, WHICH CONTAINS ADDITIONAL PERFORMANCE INFORMATION
CONCERNING THE FUND AND UPDATED INFORMATION CONCERNING THE FUND'S BREAK EVEN
POINT, THE GENERAL PARTNERS AND THE TRADING ADVISORS, IS AN INTEGRAL PART OF,
AND SHOULD BE READ IN CONJUNCTION WITH, THE PROSPECTUS. THIS SUPPLEMENT IS FOR
DISTRIBUTION ONLY IN CONJUNCTION WITH THE PROSPECTUS. TERMS NOT OTHERWISE
DEFINED HEREIN SHALL HAVE THE SAME MEANING ATTRIBUTED TO THEM IN THE
PROSPECTUS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OR AGENCY OF ANY STATE NOR HAS
ANY SUCH COMMISSION OR AGENCY PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
SUPPLEMENT TO THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE COMMODITY FUTURES TRADING COMMISSION HAS NOT PASSED UPON THE MERITS OF
PARTICIPATING IN THIS POOL NOR HAS THE COMMISSION PASSED ON THE ACCURACY OR
ADEQUACY OF THIS SUPPLEMENT TO THE PROSPECTUS.
- --------------------------------------------------------------------------------
THE FUND
As of December 31, 1998, 151,219.18358 Units are issued and outstanding, and
the Net Asset Value of the Fund was $381.85 per unit.
<PAGE>
CHARGES TO THE FUND
BREAKEVEN POINT
The following table updates the Breakeven Calculation shown on page 10 of
the Prospectus for 1999.
IDS MANAGED FUTURES, L.P.
ESTIMATED "BREAKEVEN" CALCULATION
FOR THE FUND'S 1999 YEAR OF OPERATION
<TABLE>
<CAPTION>
DOLLARS PERCENTAGE
----------- -----------------
<S> <C> <C> <C> <C>
Minimum Investment Amount (1) $1,000.00
Sales Charge (1) 60.00 6.00%
Offering Expense Charge (1) 30.00 3.00%
Administrative Fees (2) 13.75 1.38%
Advisory Management Fees (3) 36.50 3.65%
Advisory Incentive Fees (4) 12.09 1.21%
Brokerage Commission and Trading Fees (5) 30.00 3.00%
Portion to Introducing Broker 17.14 1.71%
Portion to Clearing Broker 12.86 1.29%
Periodic Operating Expenses (6) 10.00 1.00%
Less Interest Income (7) (40.50) (4.05%)
Interest Income at 90 Day T-Bill Rate 45.00 4.50%
Less Portion retained by Clearing Broker 4.50 0.45%
*BREAKEVEN POINT: $ 151.84 15.18%
----------- -----
----------- -----
</TABLE>
- ------------------------
* Amount of Trading Income required for the Fund's Net Asset Value per Unit
(Redemption Value) at the end of one year to equal the Selling Price per
Unit/Percentage of Minimum Investment Amount.
(1) Units will be purchased at the Fund's month-end Net Asset Value per Unit.
A 6% Sales Charge and a 3% Offering Expense Charge will be deducted from
the gross investment amount before the net investment units are
calculated.
(2) The Administrative Fees payable to the General Partners will total 1.375%
of the Fund's Net Asset Value on the first day of its fiscal year.
(3) As of December 31, 1998 JWH is managing approximately 65% of the assets of
the Fund at a management fee of 4% per annum. Welton is managing
approximately 35% of the assets at a current management fee of 3% per
annum. This weighted average equals a current combined management fee of
3.65% per annum.
(4) In accordance with the Advisory Contracts between the Fund and the Trading
Advisors, JWH will receive an incentive fee of 15% of new net trading
profits and Welton will receive an incentive fee of 18% of new net trading
profits, both exclusive of interest income. The incentive fees of $12.09
shown above is equal to 16.05% (see weighted average assumption in Note 3
above) of net of total trading income of $146.48 minus $30.00 of brokerage
commissions and trading fees, $36.50 of management fees and $10.00 of
periodic operating expenses.
(5) Brokerage Commissions payable by the Fund with respect to the trading
directed by the Trading Advisors have ranged from 2.46%-6.2% of the Fund's
average annual Net Asset Value over the past ten years of trading. An
estimate of 3.0% of the Net Asset Value, however, is used in this table to
reflect the current brokerage rate in effect that was reduced by 30% on
September 1, 1995. The actual brokerage commissions paid for calendar year
1997 was 2.77%. The actual brokerage commission for calendar year 1998 was
2.98%.
(6) Periodic Operating Expenses are estimated at 1% of the Fund's average
annual Net Asset Value.
(7) The Fund will earn interest income on its assets deposited at the Clearing
Broker. Based on the assumption that interest rates will not undergo a
significant change in the near future, an investment in 90 day T-Bills is
estimated to earn income of 4.50%. The Fund is paid 90% of the 90 day
T-Bill rate by the Cleaning Broker. Interest income to the Fund is
therefore estimated to be 4.05%. Net interest income earnings for the Fund
in 1997 were approximately 5.04% and for 1998 were 4.74%.
2
<PAGE>
<TABLE>
<S> <C>
THE GENERAL PARTNERS
CIS INVESTMENTS, INC. The following persons have been named directors of CIS Investments, Inc.
and are added to the "CISI" section on page 59 of the Prospectus:
BERNARD W. DAN (born in December 1960) is President and a director. Mr. Dan
has been President of Cargill Investor Services, Inc. since June 1, 1998.
He joined CIS in 1985 and held various operational positions. In 1986 Mr.
Dan was assigned to Cargill Investor Services, Ltd. in London as
Administrative Manager for all operational activities. In 1989 Mr. Dan was
assigned to CIS New York Regional Office as the Administrative Manager. Mr.
Dan was named Director of Cargill Investor Services (Singapore) Pte Ltd. at
the formation of the company in November 1994 and continued in that
position until April 1997. Mr. Dan actively serves within the futures
industry on exchange committees and industry user groups. He received a
Bachelor of Science degree in accounting from St. John's University,
Collegeville, Minnesota.
RONALD L. DAVIS (born in September 1953) is Vice President. Mr. Davis
graduated from Illinois Institute of Technology, Chicago, Illinois in 1975
with a Bachelor of Science and an MBA in 1977. He began his career in the
futures industry with A.G. Becker, Incorporated in 1980 and joined CIS in
1987 as the Administrative Manager of the Fund Services Group. He is
responsible for all administrative, accounting and reporting functions of
all CISI funds. In June 1998, Mr. Davis became Business Development Manager
of the Fund Services Group.
In addition, Mr. Hal T. Hansen and L. Carlton Anderson are no longer
officers and directors of CIS Investments, Inc.
IDS FUTURES CORPORATION The following change has occurred in the officers and directors of IDS
Futures Corporation and is added to the "IDS Futures" section on page 61 of
the Prospectus:
PETER J. ANDERSON, a director, was named Chairman of the Board of Directors
of American Express Asset Management Group Inc. (formerly IDS Advisory
Group Inc.). Mr. Anderson is also Senior Vice President--Investment
Operations and a director of American Express Financial Corporation.
THE TRADING ADVISORS
JWH The following principals have been added to the "Principals of JWH" section
on page 91 of the Prospectus:
MR. VERNE O. SEDLACEK is the president and chief operating officer and a
member of the JWH Investment Policy Committee. He is responsible for the
day-to-day management of the firm. Mr. Sedlacek is also president and
director of Westport Capital Management Corporation and Global Capital
Management Limited. Prior to joining JWH in July 1998, he was the executive
vice president and chief financial officer of Harvard Management Company,
Inc., a wholly owned subsidiary of Harvard University which, at the time of
his departure, managed approximately $14 billion of University-related
funds. At Harvard Management Company, he was responsible for managing the
areas of personnel, budgets, systems, performance analysis, contracts,
credit, compliance, custody, operations, cash management, securities
lending and market risk evaluation; he joined Harvard Management in March
1983.
Mr. Sedlacek currently serves on the Boards of Directors of the FIA and the
Chicago Mercantile Exchange, and is a member of the Global Markets Advisory
Committee of the CFTC. He received an A.B. in Economics from Princeton
University, and an M.B.A. in Accounting from New York University and was
certified as a C.P.A. by the State of New York in 1978.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
MR. E. LYNDON TEFFT is a senior vice president and the chief financial
officer. He is also the treasurer of Westport Capital Management
Corporation. Prior to joining JWH in October 1998, Mr. Tefft was the
Director of MIS and a vice president at Harvard Management Company, Inc.
where he was responsible for directing the design, development, and
operation of global equity, bond, and derivative trading, accounting, and
settlement systems beginning in May 1994. Mr. Tefft was the director of the
Office of Financial Systems (controller) at Harvard University from July
1983 to April 1994. He was responsible for the University's centralized
controllership, financial reporting, debt management, and financial
operations. Mr. Tefft received a B.S. in Industrial Management from Purdue
University, and an M.B.A. from Wharton School of Business at the University
of Pennsylvania.
DR. MARK S. RZEPCZYNSKI is a senior vice president, research and trading
and a member of the JWH Investment Policy Committee. Prior to joining JWH
in May 1998, he was vice president and director of taxable credit and
quantitative research in the fixed income division of Fidelity Management
and Research from May 1995 to April 1998, where he oversaw credit and
quantitative research recommendations for all Fidelity taxable fixed income
funds. From April 1993 to April 1995, he was a portfolio manager and
director of research for CSI Asset Management, Inc., a fixed-income money
management subsidiary of Prudential Insurance. Dr. Rzepczynski has a B.A.
(Cum Laude) Honors in Economics from Loyola University of Chicago, and an
A.M. and Ph.D. in Economics from Brown University.
MR. WILLIAM G. KELLEY is a vice president, international., responsible for
business development and investor services support for institutions, banks
and family offices outside of the United States. He is also a vice
president of Westport Capital Management Corporation. Prior to joining JWH
in September 1996, Mr. Kelley was the director of sales for Clearwater
Funds, a fund of funds from March 1995 to July 1996. He was a sales
executive for The RXR Group from June 1994 to March 1995 prior to joining
Clearwater. He also served as a vice president and director of marketing
for Signet Strategic Capital from December 1992 to June 1994. Mr. Kelley
received a B.A. in Economics from Boston College.
In addition, Mr. Barry S. Fox, Mr. Michael J. Scoyni, Ms. Eilene Nicoll,
Ms. Lynn R. Lubell, Mr. Kenneth S. Webster, Mr. Mark W. Sprankel, Mr.
Michael P. Flannery, and Ms. Wendy B. Goodyear are no longer principals of
JWH.
The following changes have been made to the first paragraph of the "Legal
Concerns" section on page 95 of the Prospectus:
The California complaints were consolidated under the caption "In re: Dean
Witter Managed Futures Litigation" in May 1997, and the New York complaints
were consolidated under the caption "In re: Dean Witter Managed Futures
Limited Partnerships Litigation" in July 1997. Additionally, the Delaware
action was withdrawn by the plaintiffs in December 1997. In November 1998,
the New York Supreme Court dismissed the complaint, and gave plaintiffs
leave to replead, which plaintiffs failed to do against JWH. Accordingly,
the complaint was dismissed with prejudice as against JWH. In the
California actions, JWH was dismissed as a defendant without prejudice
pursuant to a tolling agreement with plaintiffs that was executed in
January, 1999.
WELTON No material changes have occurred with respect to Welton.
</TABLE>
4
<PAGE>
IDS MANAGED FUTURES, L.P.
5 YEAR CAPSULE PAST PERFORMANCE
PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
<TABLE>
<CAPTION>
RATE OF RETURN (1)
-------------------------------------------------------------------------
MONTH 1998 1997 1996 1995 1994 1993
- --------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
JANUARY........ (2.88)% 3.68% 4.07% (3.05)% (4.48)% 1.19%
FEBRUARY....... (0.36)% 0.08% (3.48)% 8.41% (3.29)% 10.80%
MARCH.......... 0.94% (0.18)% (0.16)% 7.90% 5.76% (0.82)%
APRIL.......... (6.22)% (2.00)% 3.50% 4.71% (0.67)% 6.54%
MAY............ 2.49% (5.51)% (2.44)% 1.86% 3.98% 1.34%
JUNE........... (3.54)% 2.74% 0.51% (2.84)% 2.72% 1.44%
JULY........... (0.97)% 11.05% (1.09)% 0.27% (2.87)% 8.35%
AUGUST......... 12.72% (4.38)% 0.47% (0.05)% (2.15)% 3.09%
SEPTEMBER...... 9.70% 1.73% 3.34% (1.14)% (0.45)% (0.29)%
OCTOBER........ (2.96)% (1.17)% 9.26% (0.26)% 0.03% (0.04)%
NOVEMBER....... (5.24)% 1.67% 6.71% 2.43% (3.51)% (0.03)%
DECEMBER....... 6.46% 1.61% (1.48)% 3.42% (1.68)% 2.03%
-------- -------- -------- -------- -------- --------
YEAR........... 8.55% 8.68% 20.08% 23.03% (6.93)% 38.32%
-------- -------- -------- -------- -------- --------
-------- -------- -------- -------- -------- --------
</TABLE>
- ------------------------
Name of Pool: IDS Managed Futures, L.P.
Type of Pool: Publicly offered
Inception of Trading: June 16, 1987
Aggregate Subscriptions: $53,804,098
Current Net Asset Value: $57,743,177 (December 31, 1998)
Worst Monthly Percentage Draw-down: April 1998: (6.22%) (2)
Worst Peak to Valley Draw-down: July 1994 through January 1995 (12.94%) (3)
Recovery Period: February 1995 through March 1995 (4)
(1) Refer to the footnotes to the Supplemental Past Performance of IDS Managed
Futures, L.P. beginning on p. 7, for a detailed analysis of the calculation
of past performance and particularly footnote 13 for an explanation of how
Rate of Return is calculated.
(2) Draw-down means losses experienced by the Fund over a specified period.
(3) Worst peak-to-valley draw-down means the greatest cumulative percentage
decline in month-end net asset value due to losses sustained by the Fund
during any period in which the initial month-end net asset value for the
period is not equaled or exceeded by a subsequent month-end net asset value.
Worst peak-to-valley draw-down was calculated by comparing the initial
month-end net asset value to each subsequent month-end net asset value. Each
time the month-end net asset value exceeds all prior month-end net asset
values a new net trading "peak" is established. Where a subsequent month-end
net asset value does not equal or exceed the prior trading peak, the decline
is calculated as a percentage of the prior trading peak. The greatest of
such percentage declines during the period of time presented in the
performance table is the "worst peak-to-valley draw-down."
(4) Recovery Period means the period of time necessary for the Fund to recoup
all trading losses experienced by the Fund during the worst peak-to-valley
draw-down and achieve a new net trading "peak".
5
<PAGE>
IDS MANAGED FUTURES, LP
SUPPLEMENTAL PAST PERFORMANCE RECORD
PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
<TABLE>
<CAPTION>
GROSS
BEGINNING REALIZED BROKERAGE
EQUITY ADDITIONS WITHDRAWALS PROFIT (LOSS) COMMISSION
MONTH (1) (2) (3) (4) (5)
- --------------- ---------- --------- ----------- ------------- ----------
1998
<S> <C> <C> <C> <C> <C>
JAN............ 49,463,001 890,436 395,275 (1,818,633) 151,924
FEB............ 48,531,861 793,046 266,043 520,671 85,422
MAR............ 48,886,485 825,049 465,971 2,029,529 155,816
APR............ 49,702,851 812,360 322,854 (1,427,107) 105,781
MAY............ 47,101,702 604,071 395,412 (1,717,145) 117,198
JUNE........... 48,482,787 517,608 555,717 1,761,130 210,594
JULY........... 46,728,607 705,033 508,737 (2,758,198) 96,342
AUGUST......... 46,470,154 964,351 676,818 991,816 173,116
SEPTEMBER...... 52,669,398 622,983 386,169 2,152,472 161,666
OCTOBER........ 58,012,680 544,052 450,615 726,503 75,664
NOV............ 56,389,056 401,686 219,103 3,495,284 192,904
DEC............ 53,618,118 972,412 308,694 990,286 161,811
<CAPTION>
NET CHANGE IN MANAGEMENT
REALIZED UNREALIZED AND
PROFIT PROFIT INTEREST INCENTIVE OTHER NET ENDING RATE OF
(LOSS) (LOSS) INCOME FEES EXPENSES PERFORMANCE EQUITY RETURN
MONTH (6) (7) (8) (9) (10) (11) (12) (13)
- --------------- ---------- ---------- -------- ---------- -------- ----------- ---------- -------
1998
<S> <C> <C>
JAN............ (1,970,557) 559,743 194,180 145,527 64,139 (1,426,301) 48,531,861 (2.88%)
FEB............ 435,249 (402,935) 169,802 178,664 195,831 (172,379) 48,886,485 (0.36%)
MAR............ 1,873,714 (1,226,186) 182,650 353,779 19,111 457,288 49,702,851 0.94%
APR............ (1,532,888) (1,525,385) 177,504 140,505 69,379 (3,090,654) 47,101,702 (6.22%)
MAY............ (1,834,343) 3,067,160 180,770 145,587 95,576 1,172,425 48,482,787 2.49%
JUNE........... 1,550,536 (3,186,754) 177,829 140,680 117,001 (1,716,071) 46,728,607 (3.54%)
JULY........... (2,854,541) 2,446,816 189,505 139,089 97,441 (454,749) 46,470,154 (0.97%)
AUGUST......... 818,700 5,236,780 170,423 235,730 78,462 5,911,711 52,669,398 12.72%
SEPTEMBER...... 1,990,806 3,739,564 181,687 741,909 63,680 5,106,468 58,012,680 9.70%
OCTOBER........ 650,839 (2,465,586) 330,417 171,555 61,176 (1,717,062) 56,389,056 (2.96%)
NOV............ 3,302,380 (6,101,106) 11,700 161,994 4,500 (2,953,520) 53,618,118 (5.24%)
DEC............ 828,474 2,609,615 182,244 173,726 (14,734) 3,461,341 57,743,177 6.46%
GROSS RATE OF RETURN............................................................... 8.55%
RATE OF RETURN NET OF INTEREST INCOME.............................................. 7.44%
VALUE OF A UNIT INVESTMENT NET OF INTEREST......................................... 317.41
INCOME
<CAPTION>
VALUE OF A
UNIT NUMBER OF
INVESTMENT UNITS
MONTH (14) (15)
- --------------- ---------- ----------
1998
JAN............ 341.62 142,062.66
FEB............ 340.41 143,610.80
MAR............ 343.59 144,655.88
APR............ 322.23 146,175.00
MAY............ 330.25 146,806.82
JUNE........... 318.56 146,687.19
JULY........... 315.46 147,309.44
AUGUST......... 355.59 148,118.05
SEPTEMBER...... 390.06 148,725.77
OCTOBER........ 378.52 148,972.01
NOV............ 358.70 149,481.02
DEC............ 381.85 151,219.18
</TABLE>
6
<PAGE>
1. Beginning Equity is the capital committed to trading as of the beginning of
the period.
2. Additions represents all capital additions made after the close of business
on the last day of the month. Additions are net of selling commissions and
organization and offering expenses.
3. Withdrawals represents all partial or complete withdrawals and redemptions
made after the close of business on the last day of the month. As of
December 31, 1998, IDS Managed Futures, LP has not made any distributions of
capital to its limited partners.
4. Gross Realized Profit (Loss) represents gross realized profit or loss on all
trades closed out during the period.
5. Brokerage Commissions represents the total amount of all brokerage
commissions and clearing fees paid on all trades liquidated during the
period or accrued on open positions at the end of the period.
6. Net Realized Profit (Loss) equals the sum of Gross Realized Profit (Loss)
minus Brokerage Commissions.
7. Changes in Unrealized Profit (Loss) represents the change in unrealized
profits or losses on the quoted market value of unliquidated positions at
the end of each period. A negative number signifies either a decrease in
unrealized profits or an increase in unrealized losses; a positive number
signifies either an increase in unrealized profits or a decrease in
unrealized losses.
8. Interest Income represents interest received and accrued during the month.
9. Management Fees represents a charge of 1/4 of 1% of the net asset value per
month for management services. The Management Fees are paid regardless of
performance. Incentive Fees represents a charge of 18% of the trading
profits as of the end of each quarter. If trading profits for a quarter are
negative it constitutes a carryforward loss for the beginning of the next
fiscal quarter. No Incentive Fees are payable until future trading profits
for the ensuing quarter exceed carryforward loss.
10. Other Expenses represents Operating Expenses other than Management Fees and
Incentive Fees.
11. Net Performance equals Net Realized Profit (Loss) plus change in Unrealized
Profit (Loss) plus Interest Income, minus Management Fees, Incentive Fees
and Other Expenses.
12. Ending Equity represents Beginning Equity plus Additions minus Withdrawls
plus or minus Net Performance.
13. Rate of Return is calculated by dividing Net Performance by Beginning
Equity, except for the first period where Net Performance is divided by
Additions.
14. The Value of a Unit Investment is calculated by dividing the Ending Equity
by the number of Units outstanding at the end of the month. At the end of
each month the amount shown in this column is equal to the net asset value
per unit at month end. The first amount shown in this column includes
reductions for selling commissions and organization and offering expenses as
well as an adjustment for trading results in that month.
15. This represents the number of units outstanding at the end of each month.
16. Gross Rate of Return is calculated by taking the difference in Net Asset
Value per unit for the year and dividing by the beginning of the year Net
Asset Value per unit.
17. Rate of Return Net of Interest Income is calculated in the same manner as
Gross Rate of Return, except the calculation is based on the Net Asset Value
per Unit Net of interest Income in a carry forward calculation, assuming the
fund earns no interest income.
18. Net Asset Value per Unit Net of Interest Income is calculated in the same
manner as this table, except it is assumed that the fund has no interest
income for the entire life of the fund in a carry forward calculation.
7
<PAGE>
IDS MANAGED FUTURES, L.P.
ACKNOWLEDGMENT OF RECEIPT
The undersigned acknowledges that he/she has received a copy of the
Prospectus dated May 1, 1998 for IDS Managed Futures, L.P. and Supplement No. 1
dated February 1, 1999 thereto.
For
- --------------------------------------------------------------------------------
Please print or type name of Subscriber(s)
Executed and accepted this ----- day of -------, ----
<TABLE>
<S> <C>
- ------------------------------------------- -------------------------------------------
Printed Name of Subscriber Signature of Subscriber
or authorized signer or authorized signer
- ------------------------------------------- -------------------------------------------
Printed Name of Joint Subscriber Signature of Joint Subscriber
- ------------------------------------------- -------------------------------------------
Subscriber Tax ID Number Customer Account Number
</TABLE>
-------------------------------------------------------------------
THIS FORM MUST BE COMPLETED, SIGNED BY THE INVESTOR, AND
ACCOMPANY THE COMPLETED AND SIGNED SUBSCRIPTION AGREEMENT
BEFORE AN INVESTMENT IN IDS MANAGED FUTURES L.P. WILL BE
ACCEPTED.
-------------------------------------------------------------------
8
