UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Period ended June 30, 1997 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 No. 33-36656
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3589337
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification
No.)
c/o Demeter Management Corporation
Two World Trade Center, 62 Fl., New York, NY 10048
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 392-5454
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
<PAGE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
June 30, 1997
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Statements of Financial Condition
June 30, 1997 (Unaudited) and December 31, 1996.........2
Statements of Operations for the Quarters Ended
June 30, 1997 and 1996 (Unaudited)......................3
Statements of Operations for the Six Months Ended
June 30, 1997 and 1996 (Unaudited)......................4
Statements of Changes in Partners' Capital for the
Six Months Ended June 30, 1997 and 1996
(Unaudited).............................................5
Statements of Cash Flows for the Six Months Ended
June 30, 1997 and 1996 (Unaudited)......................6
Notes to Financial Statements (Unaudited) ...........7-12
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of
Operations...................................13-18
PART II. OTHER INFORMATION
Item 1. Legal Proceedings................................19-20
Item 5. Other Information...................................20
Item 6. Exhibits and Reports on Form 8-
K....................21
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
STATEMENTS OF FINANCIAL CONDITION
<CAPTION>
June 30, December 31,
1997 1996
$ $
(Unaudited)
ASSETS
<S> <C> <C>
Equity in Commodity futures trading accounts:
Cash 77,146,543 87,847,358
Net unrealized gain on open contracts 4,563,699 3,053,880
Total Trading Equity 81,710,242 90,901,238
Interest receivable (DWR) 262,946 300,473
Due from DWR 23,179 -
Total Assets 81,996,367 91,201,711
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable 915,491 688,115
Management fee payable 271,998 303,128
Accrued brokerage commissions (DWR) 245,969 141,879
Accrued administrative expenses 133,014 158,510
Accrued transaction fees and costs 17,847 10,045
Incentive fee payable - 2,587,891
Total Liabilities 1,584,319 3,889,568
Partners' Capital
Limited Partners (38,195.172 and
39,981.953 Units, respectively)78,448,533 85,273,194
General Partner (956 Units) 1,963,515 2,038,949
Total Partners' Capital 80,412,048 87,312,143
Total Liabilities and Partners' Capital81,996,367 91,201,711
NET ASSET VALUE PER UNIT 2,053.89 2,132.79
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Quarters Ended June 30,
1997 1996
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized (6,914,124) 3,274,360
Net change in unrealized 2,510,087 (376,714)
Total Trading Results (4,404,037) 2,897,646
Interest Income (DWR) 852,940 730,327
Total Revenues (3,551,097) 3,627,973
EXPENSES
Brokerage commissions (DWR) 945,317 720,448
Management fees 826,252 800,677
Transaction fees and costs 92,032 44,119
Administrative expenses 9,000 -
Incentive fees - 312,901
Letter of credit fees - 20,744
Total Expenses 1,872,601 1,898,889
NET INCOME (LOSS) (5,423,698) 1,729,084
NET INCOME (LOSS) ALLOCATION
Limited Partners (5,294,213) 1,692,901
General Partner (129,485) 36,183
NET INCOME (LOSS) PER UNIT
Limited Partners (135.44) 37.84
General Partner (135.44) 37.84
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Six Months Ended June 30,
1997 1996
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized (2,516,803) 5,343,065
Net change in unrealized 1,509,819 (537,773)
Total Trading Results (1,006,984) 4,805,292
Interest Income (DWR) 1,770,273 1,437,239
Total Revenues 763,289 6,242,531
EXPENSES
Management fees 1,725,722 1,616,681
Brokerage commissions (DWR) 1,572,709 1,430,735
Incentive fees 409,220 475,303
Transaction fees and costs 142,423 92,175
Administrative expenses 18,000 27,000
Letter of credit fees - 31,570
Total Expenses 3,868,074 3,673,464
NET INCOME (LOSS) (3,104,785) 2,569,067
NET INCOME (LOSS) ALLOCATION
Limited Partners (3,029,351) 2,516,176
General Partner (75,434) 52,891
NET INCOME (LOSS) PER UNIT
Limited Partners (78.90) 55.32
General Partner (78.90) 55.32
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the Six Months Ended June 30, 1997 and 1996
(Unaudited)
<CAPTION>
Units of
Partnership Limited General
Interest Partners Partner Total
<S> <C> <C>
<C> <C>
Partners' Capital,
December 31, 1995 47,391.540 $78,914,381 $1,624,664
$80,539,045
Net Income - 2,516,176 52,891
2,569,067
Redemptions (2,554.979) (4,430,519) -
(4,430,519)
Partners' Capital,
June 30, 1996 44,836.561 $77,000,038 $1,677,555
$78,677,593
Partners' Capital,
December 31, 1996 40,937.953 $85,273,194 $2,038,949
$87,312,143
Net Loss - (3,029,351) (75,434)
(3,104,785)
Redemptions (1,786.781) (3,795,310) -
(3,795,310)
Partners' Capital,
June 30, 1997 39,151.172 $78,448,533 $1,963,515
$80,412,048
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
For the Six Months Ended June 30,
1997 1996
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net income (loss) (3,104,785) 2
,569,067
Noncash item included in net income (loss):
Net change in unrealized (1,509,819) 537,773
(Increase) decrease in operating assets:
Interest receivable (DWR) 37,527 8,014
Due from DWR (23,179) -
Increase (decrease) in operating liabilities:
Management fee payable (31,130) (6,594)
Accrued brokerage commissions (DWR) 104,090 60,263
Accrued administrative expenses (25,496) (80,931)
Accrued transaction fees and costs 7,802
3,891
Incentive fee payable (2,587,891)
(14,173)
Bank fee payable -
(592)
Net cash provided by (used for) operating activities(7,132,881)
3,076,718
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in redemptions payable227,376 (
101,145)
Redemptions of units (3,795,310)
(4,430,519)
Net cash used for financing activities (3,567,934) (
4,531,664)
Net decrease in cash (10,700,815) (
1,454,946)
Balance at beginning of period 87,847,358
78,404,128
Balance at end of period 77,146,543
76,949,182
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
The financial statements include, in the opinion of management,
all adjustments necessary for a fair presentation of the results
of operations and financial condition. The financial statements
and condensed notes herein should be read in conjunction with the
Partnership's December 31, 1996 Annual Report on Form 10-K.
1. Organization
Dean Witter Portfolio Strategy Fund L.P. (the "Partnership"),
(formerly named Dean Witter Principal Secured Futures Fund L.P.)
is a limited partnership organized to engage in the speculative
trading of commodity futures contracts, commodity options
contracts, and forward contracts on foreign currencies
(collectively, "futures interests"). Demeter Management
Corporation ("Demeter"), the Partnership's general partner, has
retained John W. Henry & Company Inc. ("JWH") as the trading
manager of the Partnership. The commodity broker is Dean Witter
Reynolds Inc. ("DWR"). Both Demeter and DWR are wholly owned
subsidiaries of Morgan Stanley, Dean Witter, Discover & Co.
("MSDWD").
2. Related Party Transactions
The Partnership's cash is on deposit with DWR in commodity
trading accounts to meet margin requirements as needed. DWR pays
interest on these funds based on current 13-week U.S. Treasury
Bill rates.
Brokerage expenses incurred by the Partnership are paid to DWR.
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. Financial Instruments
The Partnership trades futures and forward contracts in interest
rates, stock indices, commodities, currencies, petroleum and
precious metals. Futures and forwards represent contracts for
delayed delivery of an instrument at a specified date and price.
Risk arises from changes in the value of these contracts and the
potential inability of counterparties to perform under the terms
of the contracts. There are numerous factors which may
significantly influence the market value of these contracts,
including interest rate volatility. At June 30, 1997 and
December 31, 1996, open contracts were:
Contract or Notional Amount
June 30, 1997 December 31,1996
$ $
Exchange-Traded Contracts
Financial Futures:
Commitments to Purchase 356,233,000 65,197,000
Commitments to Sell 52,456,000 70,325,000
Commodity Futures:
Commitments to Purchase 2,129,000 5,005,000
Commitments to Sell 50,984,000 30,977,000
Foreign Futures:
Commitments to Purchase 110,364,000 42,509,000
Commitments to Sell 90,049,000 67,755,000
Off-Exchange-Traded
Forward Currency Contracts
Commitments to Purchase 54,329,000 89,146,000
Commitments to Sell 58,699,000 38,531,000
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
A portion of the amounts indicated as off-balance-sheet risk in
forward currency contracts is due to offsetting forward
commitments to purchase and to sell the same currency on the same
date in the future. These commitments are economically
offsetting, but are not offset in the forward market until the
settlement date.
The net unrealized gains on open contracts are reported as a
component of "Equity in Commodity futures trading accounts" on
the Statements of Financial Condition and totaled $4,563,699 and
$3,053,880 at June 30, 1997 and December 31, 1996, respectively.
Of the $4,563,699 net unrealized gain on open contracts at June
30, 1997, $4,695,193 related to exchange-traded futures contracts
and $(131,494) related to off-exchange-traded forward currency
contracts. Of the $3,053,880 net unrealized gain on open
contracts at December 31, 1996, $3,465,469 related to exchange-
traded futures contracts and $(411,589) related to off-exchange-
traded forward currency contracts.
Exchange-traded futures contracts held by the Partnership at June
30, 1997 and December 31, 1996 mature through June 1998 and
December 1997, respectively. Off-exchange-traded forward
currency contracts held at June 30, 1997 and December 31, 1996
mature through September 1997 and March 1997, respectively. The
contract amounts in the above table represent the Partnership's
extent of
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
involvement in the particular class of financial instrument, but
not the credit risk associated with counterparty nonperformance.
The credit risk associated with these instruments is limited to
the amounts reflected in the Partnership's Statements of
Financial Condition.
The Partnership also has credit risk because DWR acts as the
futures commission merchant or the sole counterparty, with
respect to most of the Partnership's assets. Exchange-traded
futures contracts are marked to market on a daily basis, with
variations in value settled on a daily basis. DWR, as the
futures commission merchant for all of the Partnership's exchange-
traded futures contracts, is required pursuant to regulations of
the Commodity Futures Trading Commission ("CFTC") to segregate
from its own assets and for the sole benefit of its commodity
customers all funds held by DWR with respect to exchange-traded
futures contracts including an amount equal to the net unrealized
gain on all open futures contracts, which funds totaled
$81,841,736 and
$91,312,827 at June 30, 1997 and December 31, 1996, respectively.
With respect to the Partnership's off-exchange-traded forward
currency contracts, there are no daily settlements of variations
in value nor is there any requirement that an amount equal to the
net unrealized gain on open forward contracts be segregated.
With respect to those off-exchange-traded forward currency
contracts,
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
the Partnership is at risk to the ability of DWR, the
counterparty on all of such contracts, to perform.
For the six months ended June 30, 1997 and for the year ended
December 31, 1996, the average fair value of financial
instruments held for trading purposes was as follows:
June 30, 1997
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 92,731,000 100,286,000
Commodity Futures 6,577,000 29,883,000
Foreign Futures 65,577,000 41,821,000
Off-Exchange-Traded Forward
Currency Contracts 80,647,000 87,299,000
December 31, 1996
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 102,149,000 96,292,000
Commodity Futures 13,649,000 28,690,000
Foreign Futures 116,142,000 42,572,000
Off-Exchange-Traded Forward
Currency Contracts 113,353,000 134,819,000
4. Subsequent Event
Demeter reopened the Parntership for additional investment and
registered with the Securities and Exchange Commission a maximum
of 50,000 Units in an offering, closing August 1, 1997.
On July 31, 1997, DWR closed the sale of its institutional
futures business and foreign currency trading operations to Carr
Futures
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
Inc. ("Carr"), a subsidiary of Credit Agricole Indosuez.
Following the sale, Carr became the counterparty on the
Partnership's foreign currency trades. However, during a
transition period of about three months, DWR will continue to
perform certain services relating to the Partnership's futures
trading including clearance. After such transition period, DWR
will continue to serve as a futures broker for the Partnership
with Carr providing execution and clearing services for the
Partnership's account.
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity - The Partnership's assets are on deposit in futures
interest trading accounts with DWR and are used by the
Partnership as margin to engage in futures interest trading. DWR
holds such assets in either designated depositories or in
securities approved by the CFTC for investment of customer funds.
The Partnership's assets held by DWR may be used as margin solely
for the Partnership's trading. Since the Partnership's sole
purpose is to trade in futures interests, it is expected that the
Partnership will continue to own such liquid assets for margin
purposes.
The Partnership's investment in futures interests may, from time
to time, be illiquid. Most United States futures exchanges limit
fluctuations in certain futures interest prices during a single
day by regulations referred to as "daily price fluctuations
limits" or "daily limits". Pursuant to such regulations, during
a single trading day no trades may be executed at prices beyond
the daily limit. If the price of a particular futures has
increased or decreased by an amount equal to the "daily limit",
positions in such futures interest can neither be taken nor
liquidated unless traders are willing to effect trades at or
within the limit. Futures interest 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 futures interests and result in
restrictions on redemptions. However, since the commencement of
<PAGE>
trading by the Partnership, there has never been a time when
illiquidity has affected a material portion of the Partnership's
assets.
There is no limitation on daily price moves in trading forward
contracts on foreign currencies. The markets for some world
currencies have low trading volume and are illiquid, which may
prevent the Partnership from trading in potentially profitable
markets or prevent the Partnership from promptly liquidating
unfavorable positions in such markets and subjecting it to
substantial losses. Either of these market conditions could
result in restrictions on redemptions.
Capital Resources - The Partnership does not have, nor does it
expect to have, any capital assets. Redemptions and sales of
additional Units of Limited Partnership Interest in the future
will affect the amount of funds available for investments in
futures interests in subsequent periods. As redemptions are at
the discretion of Limited Partners, it is not possible to
estimate the amount and therefore the impact of future
redemptions.
Results of Operations
For the Quarter and Six Months Ended June 30, 1997
For the quarter ended June 30, 1997, the Partnership's total
trading losses net of interest income were $3,551,097. During
the second quarter, the Partnership posted a decrease in Net
Asset
<PAGE>
Value per Unit. Losses were recorded in currencies from short
Japanese yen positions as the previous strengthening in the value
of the U.S. dollar relative to the Japanese yen reversed abruptly
during May. Additional currency losses were recorded from
transactions involving the Swiss franc as its value moved without
consistent direction during the quarter. In financial futures
trading, losses were experienced from trendless price movement in
Japanese government bond futures throughout a majority of the
quarter. These losses were partially offset by gains recorded
from long positions in Australian interest rate futures and
global stock index futures as prices in these markets trended
higher during May and June. A portion of the Partnership's
overall losses for the quarter was offset by gains in metals as
short gold futures positions profited from a downward price move
during April and June. Smaller gains recorded in agricultural
futures during June, as well as in soft commodities during April
and May, also helped to offset a portion of the quarter's losses.
Total expenses for the quarter were $1,872,600, resulting in net
loss of $5,423,698. The value of an individual Unit in the
Partnership decreased from $2,189.33 at March 31, 1997 to
$2,053.89 at June 30, 1997.
For the six months ended June 30, 1997, the Partnership's total
trading losses net of interest income were $763,289. During the
first six months, the Partnership posted a decrease in Net Asset
Value per Unit. Losses were recorded in the financial futures
markets as Japanese government bond futures prices moved
<PAGE>
in a trendless pattern during the second quarter. Smaller losses
were recorded from choppy price movement in European interest
rate futures during March and April. These losses were partially
offset by gains recorded from long positions in Australian
interest rate futures, as well as in global stock index futures,
as prices in these markets trended higher during May and June.
In the energy markets, losses were recorded as oil prices moved
without consistent direction during most of the first half of the
year. In currencies, losses recorded during the first quarter
from short-term volatile movement in the value of the British
pound more than offset gains experienced from a strengthening in
the value of the U.S. dollar relative to most other European
currencies and the Japanese yen. Gains from short positions in
gold futures, as gold prices declined during January, April and
June, helped to mitigate overall Partnership losses during the
first half of the year. Smaller gains from trading agricultural
futures during February, March and June also helped to offset a
portion of these losses. Total expenses for the period were
$3,868,074 resulting in a net loss of $3,104,785. The value of
an individual Unit in the Partnership decreased from $2,132.79 at
December 31, 1996 to $2,053.89 at June 30, 1997.
For the Quarter and Six Months Ended June 30, 1996
For the quarter ended June 30, 1996, the Partnership's total
trading revenues including interest income were $3,627,973.
During the second quarter, the Partnership posted an increase in
Net Asset Value per Unit. The most significant trading gains
were
<PAGE>
recorded in the currency markets as the value of the Swiss franc
and German mark moved lower versus the U.S. dollar and other
world currencies during April. Losses from transactions
involving the Japanese yen during April offset a portion of the
gains within this complex. In the metals markets, a decline in
precious metals prices resulted in profits for the Partnership's
short gold and silver futures positions during June. Additional
gains were recorded in the agricultural markets from long corn
futures positions as prices moved in an upward direction during
April and May. Gains experienced from sugar and cotton futures
trading during May more than offset losses in coffee futures
during the quarter. In financial futures trading, losses were
recorded as trendless price movement was experienced in non-U.S.
interest rate and global stock index futures throughout the
quarter. Trading gains recorded in April from short U.S.
interest rate futures positions, as prices in these markets moved
lower, offset a portion of these losses. In the energy markets,
small losses in crude oil futures during May offset a portion of
overall Partnership gains for the fiscal quarter. Total expenses
for the quarter were $1,898,889, resulting in net income of
$1,729,084. The value of an individual Unit in the Partnership
increased from $1,716.92 at March 31, 1996 to $1,754.76 at June
30, 1996.
For the six months ended June 30, 1996, the Partnership's total
trading revenues including interest income were $6,242,531.
During the first half of the year, the Partnership posted an
increase in Net Asset Value per Unit. The most significant
<PAGE>
trading gains were recorded in the currency markets as a decline
in the value of the Swiss franc and German mark relative to the
U.S. dollar resulted in profits for the Partnership's short
positions during the second quarter, as well as during January.
Additional gains were recorded during the first quarter from
transactions involving the Australian dollar and Japanese yen.
In the metals markets, gains recorded during June from short gold
futures positions more than offset losses in silver during the
first quarter. Trading in the agricultural sector also resulted
in gains as long corn futures positions profited as prices moved
higher early in the second quarter. In the financial futures
markets, losses were recorded from trendless price movement in
non-U.S. interest rate and global stock index futures. Trading
gains from short U.S. interest rate positions during March and
April, as prices moved lower, offset a portion of these losses.
Trading losses in crude oil futures during January and May,
coupled with smaller losses in coffee futures, offset a portion
of overall Partnership gains for the first half of the year.
Total expenses for the period were $3,673,464, resulting in net
income of $2,569,067. The value of an individual Unit in the
Partnership increased from $1,699.44 at December 31, 1995 to
$1,754.76 at June 30, 1996.
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
On September 6, 10, and 20, 1996, and on March 13, 1997, similar
purported class actions were filed in the Superior Court of the
State of California, County of Los Angeles, on behalf of all
purchasers of interests in limited partnership commodity pools
sold by DWR. Named defendants include DWR, Demeter, Dean Witter
Futures & Currency Management, Inc., MSDWD, (all such parties
referred to hereafter as the "Dean Witter Parties"), the
Partnership (under its original name), certain limited
partnership commodity pools of which Demeter is the general
partner, and certain trading advisors (including JWH) to those
pools. On June 16, 1997, the plaintiffs in the above actions
filed a consolidated amended complaint. Similar purported class
actions were also filed on September 18 and 20, 1996 in the
Supreme Court of the State of New York, New York County, and on
November 14, 1996 in the Superior Court of the State of Delaware,
New Castle County, against the Dean Witter Parties and certain
trading advisors (including JWH) on behalf of all purchasers of
interests in various limited partnership commodity pools,
including the Partnership, sold by DWR. Generally, these
complaints allege, among other things, that the defendants
committed fraud, deceit, misrepresentation, breach of fiduciary
duty, fraudulent and unfair business practices, unjust
enrichment, and conversion in connection with the sale and
operation of the various limited partnership commodity pools.
The complaints seek unspecified amounts of compensatory and
punitive damages and other relief.
<PAGE>
It is possible that additional similar actions may be filed and
that, in the course of these actions, other parties could be
added as defendants. The Dean Witter Parties believe that they
and the Partnership have strong defenses to, and they will
vigorously contest, the actions. Although the ultimate outcome
of legal proceedings cannot be predicted with certainty, it is
the opinion of management of the Dean Witter Parties that the
resolution of the actions will not have a material adverse effect
on the financial condition or the results of operations of any of
the Dean Witter Parties or the Partnership.
Item 5. OTHER INFORMATION
On July 21, 1997, MSDWD, the sole shareholder of Demeter,
appointed a new Board of Directors consisting of Richard M.
DeMartini, Mark J. Hawley, Lawrence Volpe, Joseph G. Siniscalchi,
Edward C. Oelsner III, and Robert E. Murray.
<PAGE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) Exhibits - None.
(B) Reports on Form 8-K. - None.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Dean Witter Portfolio Strategy
Fund L.P. (Registrant)
By: Demeter Management
Corporation
(General Partner)
August 7, 1997 By:/s/ Patti L. Behnke
Patti L. Behnke
Chief Financial Officer
The General Partner which signed the above is the only party
authorized to act for the Registrant. The Registrant has no
principal executive officer, principal financial officer,
controller, or principal accounting officer and has no Board of
Directors.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from Dean
Witter Portfolio Strategy Fund L.P. and is qualified in its entirety
by references to such financial instruments.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-END> JUN-30-1997
<CASH> 77,146,543
<SECURITIES> 0
<RECEIVABLES> 286,125<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 81,996,367<F2>
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 81,996,367<F3>
<SALES> 0
<TOTAL-REVENUES> 763,290<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,868,075
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (3,104,785)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,104,785)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,104,785)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Receivables include interest receivable of $262,946 and due from DWR
of $23,179.
<F2>In addition to cash and receivables, total assets include net unrealized
gain on open contracts of $4,563,699.
<F3>Liabilities include redemptions payable of $915,491, accrued brokerage
commissions of $245,969, accrued management fees of $271,998, accrued
administrative expenses of $133,014, accrued transaction fees and costs
of $17,847.
<F4>Total revenues include relaized trading revenue of $(2,516,803), net
change in unrealized of $1,509,820 and interest income of $1,770,273.
</FN>
</TABLE>
