UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-Q
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarterly period ended March 31, 1999
Commission File Number: 2-73692
The Balanced Opportunity Fund L.P.
(Exact name of registrant as specified in its charter)
Illinois 36-3655854
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification No.)
Registrant's telephone number, including area code:(312) 460-9200
Indicate by check mark whether the registrant (1) 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>
The Balanced Opportunity Fund L.P.
Index
Page
Part I - Financial Information
Item 1. Financial Statements
Statements of Financial Condition (unaudited)
as of March 31, 1999 and June 30, 1998 3
Statements of Operations (unaudited) for the three
month and nine month periods ended March 31, 1999
and 1998 4
Statements of Changes in Partners' Capital (unaudited)
for the nine month period ended March 31, 1999
and the year ended June 30, 1998 5
Note to Unaudited Financial Statements -
March 31, 1999 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Part II - Other Information 8
Item 3. Exhibits and Reports on Form 8-K 8
Signatures 9<PAGE>
Part I. Financial Information
Item 1. Financial Statements
The Balanced Opportunity Fund
Statement of Financial Condition
March 31,
1999 June 30
Assets (Unaudited) 1998
Equity in futures and forward trading accounts:
Cash $ 575,879 $ 273,000
Net unrealized gain/(loss) on open contracts 16,970 1,000
--------- --------
Total equity in futures and forward trading account 592,849 274,000
Guaranteed yield pool, at market 2,265,328 2,657,000
Other receivable 2,027 3,000
-------- --------
Total Assets $2,860,204 $2,934,000
========== ==========
Liabilities and Partners' Capital
Liabilities:
Accrued administrative expenses $ 27,828 $ 31,000
Accrued brokerage commission and fees 6,820 6,000
Accrued management fees 2,352 5,000
Accrued incentive fees - -
Redemption Payable - 98,000
Miscellaneous payables - -
-------- --------
37,000 140,000
Partners' Capital
Limited Partners (units outstanding 1,296.852;
1,967.8520) 2,599,767 2,578,000
General Partner (units outstanding : 111.1143) 223,437 216,000
-------- --------
2,823,205 2,794,000
-------- --------
Total Liabilities and Partners' Capital $2,860,204 $2,934,000
======== ========
Net Asset Value per Unit $2,010.88 $ 1,946.33
See Note to the unaudited financial statements <PAGE>
The Balanced Opportunity Fund L.P.
Statement of Operations
(unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,
Revenues 1999 1998 1999 1998
Trading profit/(loss):
Realized $ 23,334 $ 70,941 $ 100,648 $ 340,226
Change in unrealized (41,086) 88,538 16,383 (2,701)
Foreign currency gain/(loss) (935) (178) 626 (2,811)
-------- -------- ------- -------
Total trading profit and
foreign currency gain/(loss) (18,687) 159,301 117,658 334,714
Guaranteed yield pool:
Accrued Interest 34,244 45,155 105,957 146,702
Unrealized market value gain (loss) (52,910) 4,186 21,265 90,547
-------- -------- ------- -------
Total guaranteed yield pool revenue(18,666) 49,341 127,222 237,249
Interest Income 6,198 9,308 16,553 26,726
-------- -------- ------- -------
Total Revenues (31,154) 217,680 261,432 598,689
Expenses
Brokerage commissions $ 29,529 $ 34,125 $ 87,869 $105,623
Management fees 7,173 8,373 21,490 25,801
Incentive fees - - - -
Other administrative expenses 19,500 19,500 58,500 75,557
State taxes - - - 1,305
-------- -------- ------- -------
56,203 61,998 167,859 208,286
-------- -------- ------- -------
Net Income/(Loss) $(87,357) $155,682 $ 93,573 $390,403
======== ======== ======= =======
Net Income/(Loss) Allocated To:
Limited Partners $(80,485) $145,898 $ 86,401 $367,536
======== ======== ======= =======
General Partners $ (6,872) $ 9,784 $ 7,172 $ 22,867
======== ======== ======= =======
Net Income/(Loss) per unit
outstanding for entire period $ (61,85) $ 88.06 $ 64.55 $ 205,80
========= ======== ======= =======
See Note to the unaudited financial statements<PAGE>
The Balanced Opportunity Fund L.P.
Statement of Changes in Partners' Capital
Total Units
of Partnership Limited General
Interest Partners Partners Total
Partners Capital June 30, 1996 3,504 $5,305,000 $ 174,000 $5,479,000
Redemption (1,425) (2,356,000) (2,356,000)
Net Income (loss) 422,000 16,000 438,000
------- --------- --------- ---------
Partners Capital June 30,1997 2,079 $3,371,000 $ 190,000 $3,561,000
Redemption (646) (1,197,815) (1,197,815)
Net Income (loss) 405,716 26,265 431,441
------- --------- --------- ---------
Partners Capital June 30, 1998 1,433 2,578,361 216,265 2,794,626
Redemption (29) (64,995) - (64,995)
Net Income (loss) - 86,401 7,172 93,573
------- --------- --------- ---------
Partners Capital March 31, 1999 1,404 $2,599,767 $ 233,437 $2,823,205
======= ========= ========= ========= <PAGE>
The Balanced Opportunity Fund L.P.
Note to Unaudited Financial Statements
March 31, 1999
Note - Basis of Presentation
The unaudited financial statements of The Balanced Opportunity Fund L.P.
(the "Partnership") have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the
opinion of management, all adjustments considered necessary for a fair
presentation of the financial condition and results of operations of the
Partnership for the periods presented have been included. For further
information, refer to the financial statements and footnotes thereto included
in the Partnership's annual report on Form 10-K for the year ended June 30,
1998.<PAGE>
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Capital Resources
The purpose of the Partnership is to trade commodity interests; as such,
the Partnership does not have, nor does it expect to make, any capital
expenditures or have any capital assets that are not operating capital or
assets. The Partnership's use of assets is solely to provide necessary margin
or premiums for, and to pay any losses incurred in connection with, its trading
activity. The Net Asset Values are calculated and equity reports are reviewed
by the General Partner on a daily basis to monitor the trading advisors'
activity to maximize the market and credit risks of the Fund. The General
Partner also monitors the trading advisors' compliance with investment
objectives as set forth in the prospectus. Redemption of additional units in
the future will impact the amount of funds available for trading commodity
interest. The amount of funds available was reduced by $64,995 from
redemptions of units during the quarter ended March 31, 1999.
Liquidity
Most United States commodity exchanges limit fluctuations in commodity
futures contract prices during a single day by regulations referred to as
_daily price fluctuation limits_ or _daily limits_. During a single trading
day, no trades may be executed at a price beyond the daily limit. Once the
price of a futures contract has reached the daily limit for that day, positions
in that contract can neither be taken nor liquidated. Commodity futures prices
have occasionally reached the daily limit for several consecutive days with
little or no trading. Similar occurrences could prevent the Partnership from
promptly liquidation unfavorable positions and subject the Partnership to
substantial losses which could exceed the margin initially committed to such
trades. In addition, even if commodity futures prices have not reached the
daily limit, the Partnership may not be able to execute futures trades at
favorable prices if little trading in such contracts is taking place. Other
than these limitations on liquidity, which are inherent in the Partnership's
trading of commodity interests, the Partnership's assets are highly liquid and
are expected to remain so. The counterparty for all exchange traded and
over-the counter contracts was Rosenthal Collins Group LP. A portion of the
Fund's assets have been invested in certain United States treasury obligations.
This investment is designed to provide ultimate repayment of the investors'
initial contributions. These securities are not used for trading purposes.<PAGE>
Results of Operations
Given the volatility of the markets in which the Partnership trades, its
quarterly results can fluctuate significantly and are not indicative of the
expected results for the fiscal year.
In the three month and Nine month period ending March 31, 1999, the Fund
experienced trading profits of $-18,687 and $117,658 compared to $159,301 and
$334,714 for the same periods in 1998. In the three month and Nine month
period ending March 31, 1999, the total guaranteed yield pool revenue was
$-18,666 and $127,222 compared to $49,341 and $237,249 for the same periods in
1998.
At March 31, 1999 there was no material credit risk exposure exceeding 10%
of total assets for either exchange traded or over-the-counter contracts.
Brokerage commissions and advisory fees, which are based on the net assets
of the Fund, declined as a direct result of redemptions.
Part II - Other Information
Item 3. Exhibits and Reports on Form 8-K
No reports were filed on Form 8-K during the three months ended March 31,
1999.
<PAGE>
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934 and to the extent possible due to the acquisition of the
registrant by the undersigned on April 24, 1998; the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly
authorized.
The Balanced Opportunity Fund L.P. (Registrant)
By: Rodman & Renshaw Futures Management, Inc., General Partner
By: /s/ J. Robert Collins
------------------------
J. Robert Collins, President
Date: April 10, 1999<PAGE>
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-END> MAR-31-1999
<CASH> 575,879
<SECURITIES> 2,265,328
<RECEIVABLES> 2,027
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 16,970
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,860,204
<CURRENT-LIABILITIES> 37,000
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,823,205
<TOTAL-LIABILITY-AND-EQUITY> 2,860,204
<SALES> 0
<TOTAL-REVENUES> (31,154)
<CGS> 0
<TOTAL-COSTS> 56,203
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<INCOME-PRETAX> (87,357)
<INCOME-TAX> 0
<INCOME-CONTINUING> (87,357)
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (87,357)
<EPS-PRIMARY> (61.85)
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</TABLE>
