<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED: 3/31/98 COMMISSION FILE NUMBER: 33-33982
TUDOR FUND FOR EMPLOYEES L.P.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3543779
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
600 Steamboat Road, Greenwich, Connecticut 06830
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(203) 863-6700
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
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 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.
X YES NO
----- -----
<PAGE>
PART 1 - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
TUDOR FUND FOR EMPLOYEES L.P.
STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1998 1997
(UNAUDITED) (AUDITED)
-------------------- ----------------------
<S> <C> <C>
ASSETS
------
CASH $ 3,673,148 $ 7,088,210
EQUITY IN COMMODITY TRADING ACCOUNTS:
Due from broker 3,869,108 2,264,274
U.S. Government obligations 7,370,682 7,477,448
Net unrealized gain on open commodity interests 299,590 211,519
-------------------- ----------------------
Total equity 11,539,380 9,953,241
Subscription Receivable - 125,000
-------------------- ----------------------
Total assets $ 15,212,528 $ 17,166,451
==================== ======================
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
LIABILITIES:
Pending partner additions $ 625,899 $ 4,160,168
Redemptions payable 840,490 3,339,382
Incentive fee payable 66,614 49,172
Management fee payable 62,271 56,054
Accrued professional fees and other 76,404 65,988
Total liabilities 1,671,678 7,670,764
-------------------- ----------------------
PARTNERS' CAPITAL:
Limited Partners, 10,000 units authorized and 3,033.551 and
2,186.284 outstanding at March 31, 1998 and December 31, 1997 12,716,775 8,712,315
General Partner, 196.580 units outstanding at March 31, 1998 and
December 31, 1997 824,075 783,372
-------------------- ----------------------
Total partners' capital 13,540,850 9,495,687
-------------------- ----------------------
Total liabilities and partners' capital $ 15,212,528 $ 17,166,451
==================== ======================
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
TUDOR FUND FOR EMPLOYEES L.P.
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
(UNAUDITED)
<TABLE>
<CAPTION>
MARCH 31, MARCH 31,
1998 1997
---------- ----------
<S> <C> <C>
REVENUES:
Net realized trading gains $ 710,311 $ 996,465
Change in net unrealized trading gains 73,776 765,763
Interest income 161,734 135,818
---------- ----------
Total revenues 945,821 1,898,046
EXPENSES:
Brokerage commissions and fees 67,504 59,677
Incentive fee 66,614 85,870
Management fee 62,271 50,235
Professional fees and other 23,947 24,013
---------- ----------
Total expenses 220,336 219,795
---------- ----------
Net income $ 725,485 $1,678,251
========== ==========
Limited Partners' Net Income 684,782 1,572,741
General Partners' Net Income 40,703 105,510
---------- ----------
$ 725,485 $1,678,251
========== ==========
Changes in Net Asset Value per Unit $207.05 $536.73
========== ==========
Net Income per Unit (Note 2) $211.59 $539.92
========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
TUDOR FUND FOR EMPLOYEES L.P.
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
FOR THE PERIOD ENDED MARCH 31, 1998 AND THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
LIMITED PARTNERS GENERAL PARTNER
---------------- --------------- TOTAL NET ASSET VALUE
UNITS CAPITAL UNITS CAPITAL CAPITAL PER UNIT
----- ------- ----- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Partners' Capital, January 1, 1997 2,521.886 $ 7,909,798 196.580 $616,568 $ 8,526,366 $3,136.46
Net income - 2,546,001 - 166,804 2,712,805
TIC 401(k) Plan unit adjustment (a) 9.772 - -
Capital Contributions 746.608 2,546,367 - - 2,546,367
Redemptions (1,091.982) (4,289,851) - - (4,289,851)
--------- --------- ------- ------- ---------
Partners' Capital, December 31, 1997 (b) 2,186.284 8,712,315 196.580 783,372 9,495,687 $3,984.99
--------- --------- ------- ------- ---------
Net income - 684,782 40,703 725,485
TIC 401(k) Plan unit adjustment (a) 3.805 - - - -
Capital Contributions 1,043.959 4,160,168 - - 4,160,168
Redemptions (200.497) (840,490) - - (840,490)
--------- --------- ------- ------ ---------
Partners' Capital, March 31, 1998 (b) 3,033.551 $12,716,775 196.580 $824,075 $13,540,850 $4,192.04
========= =========== ======= ======== =========== =========
(a) (See Note 3 - Capital Accounts)
(b) (See Note 4 - Redemption of Units)
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1998
(UNAUDITED)
(1) ORGANIZATION
------------
Tudor Fund For Employees L.P. (the "Partnership") was organized under
the Delaware Revised Uniform Limited Partnership Act (the "Act") on
November 22, 1989, and commenced trading operations on July 2, 1990.
Second Management LLC (the "General Partner"), a Delaware limited
liability company was the general partner for the Partnership during the
quarter ended March 31, 1998 and owned approximately 197 units of
general partnership interest. Ownership of limited partnership units is
restricted to employees of Tudor Investment Corporation ("TIC") and its
affiliates and certain employee benefit plans.
The objective of the Partnership is to realize capital appreciation
through speculative trading of commodity futures, forward, and option
contracts and other commodity interests ("commodity interests"). The
Partnership will terminate on December 31, 2010 or at an earlier date if
certain conditions occur as outlined in its Second Amended and Restated
Limited Partnership Agreement.
DUTIES OF THE GENERAL PARTNER
-------------------------------
The General Partner acts as the commodity pool operator for the
Partnership and is responsible for the selection and monitoring of the
commodity trading advisor and the commodity brokers used by the
Partnership. The General Partner is also responsible for the
performance of all administrative services necessary to the
Partnership's operations.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------------------------------------------
ACCOUNTING POLICY
-----------------
The financial statements presented have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission ("SEC")
and, in the opinion of management of the General Partner, include all
adjustments necessary for a fair statement of each period presented.
REVENUE RECOGNITION
---------------------
Commodity interests are recorded on the trade date at the transacted
contract price and valued at market.
BROKERAGE COMMISSIONS AND FEES
--------------------------------
These expenses represent all brokerage commissions and exchange,
National Futures Association and other fees incurred in connection with
the execution of commodity interest trades. Commissions and fees
associated with open commodity interests at the end of the period are
accrued on a round-turn basis.
<PAGE>
INCENTIVE FEE
-------------
The Partnership pays TIC, as trading advisor, an incentive fee equal to
12% of the Trading Profits (as defined by the Limited Partnership
Agreement) earned as of the end of each fiscal quarter of the
Partnership. Effective August 1, 1995, TIC has waived its right to
receive incentive fees attributable to units held at the beginning of
each month by the Tudor Investment Corporation 401(k) Savings and Profit
Sharing Plan (the "TIC 401(k) Plan").
MANAGEMENT FEE
--------------
The Partnership also pays TIC, for the performance of its duties, a
monthly management fee equal to 1/12 of 2% (2% per annum) of the
Partnership's net assets. Effective August 1, 1995, TIC waived its
right to receive management fees attributable to units held at the
beginning of each month by the TIC 401(k) plan.
FOREIGN CURRENCY TRANSLATION
----------------------------
Assets and liabilities denominated in foreign currencies are translated
at month-end exchange rates. Gains and losses resulting from foreign
currency transactions are calculated using daily exchange rates and are
included in the accompanying statements of operations.
U.S. GOVERNMENT OBLIGATIONS
---------------------------
The Partnership invests a varying amount of its assets in U.S. Treasury
bills. A portion of such bills is held in commodity trading accounts
and used to fulfill initial margin requirements. U.S. Treasury bills,
with varying maturities through January 1999 are valued in the
statements of financial condition at original cost plus accrued discount
which approximates the market value. These bills had a face value of
$7,500,000 (cost $7,301,567 and $7,405,486) at March 31, 1998 and
December 31, 1997.
SUBSCRIPTIONS RECEIVABLE
------------------------
Prospective investors are required to complete, execute and deliver a
Subscription Agreement, as defined in the Limited Partnership Agreement.
Subscriptions receivable arise when a signed Subscription Agreement has
been completed, executed and delivered, but payment is received by the
Partnership subsequent to year-end.
NET INCOME PER UNIT
-------------------
Net income per unit is computed by dividing net income by the monthly
average of units outstanding at the beginning of each month.
<PAGE>
(3) CAPITAL ACCOUNTS
----------------
Each partner, including the General Partner, has a capital account with
an initial balance equal to the amount such partner paid for its units.
The Partnership's net assets are determined monthly, and any increase or
decrease from the end of the preceding month is added to or subtracted
from the capital accounts of the partner based on the ratio that each
capital account bears to all capital accounts as of the beginning of the
month. The number of units held by the TIC 401(k) Plan will be restated
as necessary for management and incentive fees attributable to units
held at the beginning of each month by the TIC 401(k) Plan to equate the
per unit value of the TIC 401(k) Plan's capital account with the
Partnership's per unit value.
(4) REDEMPTION OF UNITS
-------------------
At each quarter-end, units are redeemable at the discretion of the
limited partner. Redemption of units in $1,000 increments and full
redemption of all units are made at 100% of the net asset value per unit
effective as of the last business day of any quarter as defined in the
Limited Partnership Agreement. Partial redemptions of units which would
reduce the net asset value of a limited partner's unredeemed units to
less than the minimum investment then required of new limited partners
or such partner's initial investment, whichever is less, will be honored
only to the extent of such limitation.
(5) INCOME TAXES
------------
No provision for income taxes has been made in the accompanying
financial statements. Partners are responsible for reporting income or
loss based upon their respective shares of revenue and expenses of the
Partnership.
(6) RELATED PARTY TRANSACTIONS
--------------------------
The General Partner, due to its relationship with its affiliates and
certain other parties, may enter into certain related party
transactions.
Bellwether Partners LLC ("BPL"), a Delaware limited liability company,
and an affiliate of the General Partner, is the Partnership's primary
forward contract counterparty. Effective August 1, 1995, BPL ceased
charging commissions for transacting the partnership's foreign exchange
and commodity forward contracts. The Partnership typically has on
deposit with BPL, as collateral for forward contracts, up to 15% of the
Partnership's net assets.
Bellwether Futures LLC ("BFL"), a Delaware limited liability company is
an affiliate of the General Partner. Effective January 1, 1996, BFL
ceased collecting give-up fees from the Partnership as compensation for
managing the execution of treasury bond futures by floor brokers on the
Chicago Board of Trade.
TIC, an affiliate of the General Partner, receives incentive and
management fees as compensation for acting as the Partnership's trading
advisor (see Note 2).
<PAGE>
(7) FINANCIAL INSTRUMENTS WITH OFF BALANCE SHEET RISK AND CONCENTRATION OF
----------------------------------------------------------------------
CREDIT RISK
-----------
The Partnership is a party to financial instruments with elements of
off-balance sheet credit and market risk in excess of the amounts
recognized in the statements of financial condition through its trading
of financial futures, forwards, swaps and exchange traded and negotiated
over-the-counter options.
Exchange traded futures and options contracts are marked-to-market
daily, with variations in value settled on a daily basis with the
exchange upon which they are traded and with the futures commission
merchant through which the commodity futures and options are executed.
The forward contracts are generally settled with the counterparty at
least two business days after the trade. Futures and forwards are
typically liquidated by entering into offsetting contracts with the same
counterparty.
At March 31, 1998 and December 31, 1997, the Partnership held financial
instruments with the following approximate aggregate notional value
(000's omitted):
<TABLE>
<CAPTION>
March 31, December 31,
----------- ------------
1998 1997
----------- ------------
<S> <C> <C>
Exchange Traded Contracts:
Interest Rate Futures and Option Contracts -
Domestic
Less than 6 months 27,472 5,995
6 months to 1 year 655,595 -
1 to 2 years 90,368 -
Foreign
Less than 6 months 19,280 40,892
6 months to 1 year 161,809 43,351
1 to 2 years - 38,106
Foreign Exchange Contracts -
Financial Futures Contracts 7,217 8,257
Forward Currency Contracts
Less than 6 months 15,775 8,389
6 months to 1 year 3,521 3,000
Equity Index Futures -
Domestic - 3,425
Foreign 5,850 2,333
Over-the-Counter Contracts:
Forward Currency Contracts 12,000 -
Commodity Swaps
Less than 6 months 430 436
6 months to 1 year 1,617 -
---------- --------
Total $1,000,934 $154,184
========== ========
</TABLE>
<PAGE>
Notional amounts of these financial instruments are indicative only of the
volume of activity and should not be used as a measure of market and credit
risk. The various financial instruments held at March 31, 1998 and December
31, 1997 mature through the following dates:
<TABLE>
<CAPTION>
March 31, December 31,
1998 1997
------------------- -------------------
<S> <C> <C>
Exchange traded Contracts:
Interest Rate Futures and Options Contracts June 1999 December 1999
Foreign Exchange Contracts January 1999 October 1998
Equity Index Futures June 1998 March 1998
Over-the-Counter Contracts:
Foreign Currency Contracts April 1998 -
Commodity Swaps December 1998 April 1998
</TABLE>
The following table summarizes the quarter-end and the average assets and
liabilities resulting from unrealized gains and losses on derivative
instruments included in the statements of financial condition based on
month-end balances (000's omitted):
<TABLE>
<CAPTION>
Assets Liabilities
------------- -------------
March 31, March 31,
1998 Average 1998 Average
---- ------- ---- -------
<S> <C> <C> <C> <C>
Exchange Traded Contracts:
Interest Rate Contracts -
Domestic 196 65 - -
Foreign 54 34 - -
Foreign Exchange Contracts -
Financing Futures Contracts 1 - - 52
Forward Currency Contracts - - 20 58
Equity Index Futures -
Domestic - 6 - 17
Foreign 13 46 52 23
Over-the-Counter Contracts:
Forward Currency Contracts 114 107 - -
Commodity Swaps - - 74 25
Equity Index Swaps - - - 1
------ ------ ------ ------
Total 378 258 146 176
====== ====== ====== ======
</TABLE>
<PAGE>
Net trading gains and losses from strategies that use a variety of
financial instruments are recorded in the statements of operations. The
following table summarizes the components (in thousands) of trading gains
and losses, net of commissions and fees, for the three months ended March
31, 1998 and 1997.
<TABLE>
<CAPTION>
Three Months Ended
March 31, March 31,
1998 1997
-------- --------
<S> <C> <C>
Exchange Traded Contracts:
Interest Rate Futures and Options Contracts- $ 386 $ 322
Domestic (89) (129)
Foreign
Foreign Exchange Contracts (394) 338
Equity Index Futures -
Domestic 169 178
Foreign 117 279
Over-the-Counter Contracts:
Forward Currency Contracts 516 (23)
Commodity Swaps (82) -
Equity Index Swaps (84) -
Non-Derivative Financial Instruments 172 738
-------- --------
Total $ 711 $1,703
======== ========
</TABLE>
In general, exchange traded futures and option contracts possess low credit
risk as most exchanges act as principal to a Futures Commission Merchant
("FCM") on all commodity transactions. Furthermore, most global exchanges
require FCM's to segregate client funds to insure ample customer protection
in the event of an FCM's default. The Partnership monitors the
creditworthiness of its FCM's and counterparties and, when deemed necessary,
reduces its exposure to these FCM's and counterparties. The Partnership's
exposure to credit risk associated with the non-performance of these FCM's
and counterparties in fulfilling contractual obligations can be directly
impacted by volatile financial markets. A substantial portion of the
Partnership's open financial futures positions were transacted with major
international FCM's. BPL is the Partnership's primary forward contract
counterparty (Note (6)). Notwithstanding the risk monitoring and credit
review performed by the Partnership with respect to its FCM's and
counterparties, including BPL, there always exists a risk of nonperformance.
Generally, financial contracts can be closed out at the discretion of the
trading advisor. However, an illiquid or closed market could prevent the
close-out of positions.
<PAGE>
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF
- ------- -------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
The Partnership commenced operations on July 2, 1990. Following the closing
of the initial offering period, the Partnership had 37 Limited Partners who
subscribed for 421 units for $421,000. In addition, the General Partner
purchased 400 units of general partnership interest for $400,000. The
Partnership had additions of $4,160,168 and redemptions of $840,490 during
the quarter ended March 31, 1998 (the "Current Quarter"). From its
inception through April 1, 1998, the Partnership received total Limited
Partner contributions of $19,824,990 and had total withdrawals of
$14,593,118. In addition, the General Partner contributed $1,900,000 since
inception. The General Partner redeemed $2,000,000 on March 31, 1994 and
$1,400,000 on December 31, 1996. The General Partner's equity in the
Partnership as of March 31, 1998 was approximately $824,000, representing
6% of the Partnership's equity. At April 1, 1998, the Partnership had a
total of 99 Limited Partners.
As specified in the Second Amended and Restated Limited Partnership
Agreement, dated May 22, 1996, the Partnership may accept investments from
certain employee benefit plans to the extent that such investment does not
exceed 25% of the aggregate value of outstanding units, excluding units
held by the General Partner and its affiliates. On August 1, 1995, the
Partnership accepted an investment of $99,306 from the Tudor Investment
Corporation 401(k) Savings and Profit-Sharing Plan (the "TIC 401(k)
Plan" ), a qualified plan organized for the benefit of employees of TIC and
certain of its affiliates. The Partnership has received TIC 401(k) Plan
contributions in the aggregate amount from inception through April 1, 1998
of $1,611,192. The TIC 401(k) Plan's equity in the Partnership as of April
1, 1998 was approximately $2,016,000, representing approximately 14.2% of
the Partnership's equity or approximately 16.4% excluding units held by the
General Partner and its affiliates. TIC has waived its right to receive
management and incentive fees attributable to units held by the TIC 401(k)
Plan. The number of units of limited partnership interest held by the TIC
401(k) Plan will be restated as necessary to equate the per unit value of
the TIC 401(k) Plan's capital account with the Partnership's per unit
value. Furthermore, BPL ceased charging commissions for transacting the
Partnership's foreign exchange spot and forward and commodity forward
contracts.
(1) LIQUIDITY
---------
The Partnership's assets are deposited and maintained with BPL, banks or in
trading accounts with clearing brokers, and are used by the Partnership as
margin and collateral to engage in futures, option, and forward contract
trading. The Partnership invests in U.S. Government obligations approved
by the various contract markets to fulfill initial margin requirements. As
of March 31, 1998 and December 31, 1997, U.S. Government obligations with
varying maturities through January 1999 represented approximately 48% and
44% of the total assets of the Partnership. The percentage that U.S.
Government obligations bear to the total assets varies daily and monthly,
as the market value of commodity interest contracts changes, as Government
obligations are purchased or mature, and as the Partnership sells or
redeems units. Since the Partnership's sole purpose is to trade in
futures, option, and forward contracts, and other commodity interest
contracts, it is
<PAGE>
anticipated that the Partnership will continue to maintain substantial
liquid assets for margin purposes. Interest income for the Current Quarter
was $161,734, compared to $135,818 during the quarter ended March 31, 1997.
This increase was due to an increase in the Partnership's assets.
In the context of the commodity or futures trading industry, cash and cash
equivalents are part of the Partnership's inventory. Cash deposited with
banks represented approximately 24% and 41% of the Partnership's assets as
of March 31, 1998 and December 31, 1997. The cash and U.S. Government
obligations held at clearing brokers and banks at quarter-end satisfy the
Partnership's need for cash on both a short-term and long-term basis.
Since futures contract trading generates a significant percentage of the
Partnership's income, any restriction or limit on that trading may render
the Partnership's investment in futures contracts illiquid. Most U.S.
commodity exchanges limit fluctuations in certain commodity futures and
options contract prices during a single day by regulations referred to as a
"daily price fluctuation limit" or "daily limit." Pursuant to such
regulations, during a single trading day, no trade may be executed at a
price beyond the daily limits. If the price for a contract has increased
or decreased by an amount equal to the "daily limit," positions in such
contracts can neither be taken nor liquidated unless traders are willing to
effect trades at or within the limit. Commodity interest contract 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 interest contract positions and
impose restrictions on redemptions.
(2) CAPITAL RESOURCES
-----------------
The Partnership does not have, nor does it expect to have, any fixed
assets. Redemptions and additional sales of units in the future will
affect the amount of funds available for investments in commodity interest
contracts in subsequent periods.
The Partnership is currently open to new investments which can be made on a
quarterly basis. Such investments are limited to existing and future
employees of TIC and certain of its affiliates and certain employee benefit
plans, including, but not limited to, the TIC 401(k) Plan.
(3) RESULTS OF OPERATIONS
---------------------
The following table compares net asset value per unit as of March 31, 1998
and 1997:
<TABLE>
<CAPTION>
Net Asset Value Increase During
per unit Quarter
--------------------- -----------------------------------
$ %
--------- -------
<S> <C> <C> <C>
March 31, 1998 $4,192.04 $207.05 5.20%
March 31, 1997 $3,673.19 $536.73 17.11%
</TABLE>
<PAGE>
Net trading gains and losses from strategies that use a variety of
derivative financial instruments are recorded in the statements of
operations. The following table summarizes the components (in thousands)
of trading gains and losses, net of commissions, for the three months ended
March 31, 1998 and 1997.
<TABLE>
<CAPTION>
Three Months Ended
March 31, March 31,
1998 1997
-------- --------
<S> <C> <C>
Exchange Traded Contracts:
Interest Rate Futures and Options Contracts- $ 386 $ 322
Domestic (89) (129)
Foreign
Foreign Exchange Contracts (394) 338
Equity Index Futures -
Domestic 169 178
Foreign 117 279
Over-the-Counter Contracts:
Forward Currency Contracts 516 (23)
Commodity Swaps (82) -
Equity Index Swaps (84) -
Non-Derivative Financial Instruments 172 738
-------- --------
Total $ 711 $1,703
======== ========
</TABLE>
Since the Partnership is a speculative trader in the commodities markets,
current year results are not comparable to previous year's results. The
following table illustrates the Partnership's net trading gain as a return
on net assets, brokerage commissions and fees as a percentage of net assets,
and incentive fees as a percentage of trading profits.
<TABLE>
<CAPTION>
Three Months Ended
--------------------------------------
March 31, 1998 March 31, 1997
-------------- ---------------
<S> <C> <C>
Trading Gains as a % of Net Assets 5.3% 15.9%
Brokerage Commissions & Fees as a % of Net Assets 0.5% 0.6%
Incentive Fees as a % of Trading Profits 9.3% 5.0%
</TABLE>
In general, commission rates have remained stable during the past three
years. Trading losses of $866,300 incurred during the last six months of
1996 resulted in lower incentive fees as a percentage of Trading Profits
during the first six months of 1997 because trading losses need to be
recouped by the Partnership prior to the Partnership's payment of incentive
fees to the Trading Advisor.
Professional fees and other expenses during the Current Quarter remained
stable as compared to the quarter ended March 31, 1997.
<PAGE>
Inflation is not expected to be a major factor in the Partnership's
operations, except that traditionally the commodities markets have tended
to be more active, and thus potentially more profitable during times of
high inflation. Since the commencement of the Partnership's trading
operations in July 1990, inflation has not been a major factor in the
Partnership's operations.
PART II OTHER INFORMATION
ITEM 2 CHANGES IN SECURITIES AND USE OF PROCEEDS
-----------------------------------------
The effective date of the registration statement of the Partnership
(Commission file number 33-33982) was June 22, 1990. Through April 1,
1998, an aggregate of $21,724,990 of Units had been sold.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
TUDOR FUND FOR EMPLOYEES L.P.
By: Second Management LLC,
General Partner
By: /s/ Mark F. Dalton
-------------------------------
Mark F. Dalton,
President, General Partner
By: /s/ Mark Pickard
-----------------------------------
Mark Pickard,
Managing Director and
Chief Financial Officer of the
General Partner
May 14, 1998
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM TUDOR FUND
FOR EMPLOYEES L.P. AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 3,673,148
<SECURITIES> 7,370,682
<RECEIVABLES> 4,168,698
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 15,212,528
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 15,212,528
<CURRENT-LIABILITIES> 1,671,678
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 13,540,850
<TOTAL-LIABILITY-AND-EQUITY> 15,212,528
<SALES> 945,821
<TOTAL-REVENUES> 945,821
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 220,336
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 725,485
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 725,485
<EPS-PRIMARY> 207.05
<EPS-DILUTED> 0
</TABLE>
