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 September 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 Corp.
Two World Trade Center, New York, NY 62 Fl. 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
September 30, 1997
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Statements of Financial Condition
September 30, 1997 (Unaudited) and December 31, 1996.....2
Statements of Operations for the
Quarters Ended September 30, 1997 and 1996 (Unaudited)..3
Statements of Operations for the Nine
Months Ended September 30, 1997 and 1996 (Unaudited).....4
Statements of Changes in Partners'
Capital for the Nine Months Ended September 30, 1997
and 1996 (Unaudited).....................................5
Statements of Cash Flows for the
Nine Months Ended September 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 2. Changes in Securities and Use of Proceeds.....20-21
Item 5. Other Information................................21
Item 6. Exhibits and Reports on Form 8-K........
.........22
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
STATEMENTS OF FINANCIAL CONDITION
<CAPTION>
September 30, December 31,
1997 1996
$ $
(Unaudited)
ASSETS
<S> <C> <C>
Equity in Commodity futures trading accounts:
Cash 119,250,489 87,847,358
Net unrealized gain on open contracts 6,310,562 3,053,880
Total Trading Equity 125,561,051 90,901,238
Interest receivable (DWR) 435,823 300,473
Due from DWR 26,346 -
Total Assets 126,023,220 91,201,711
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Management fee payable 418,620 303,128
Redemptions payable 381,289 688,115
Accrued brokerage commissions (DWR) 277,445 141,879
Accrued administrative expenses 137,257 158,510
Accrued transaction fees and costs 22,545 10,045
Incentive fee payable - 2,587,891
Total Liabilities 1,237,156 3,889,568
Partners' Capital
Limited Partners (56,134.876 and
39,981.953 Units, respectively) 122,696,493 85,273,194
General Partner (956 Units) 2,089,571 2,038,949
Total Partners' Capital 124,786,064 87,312,143
Total Liabilities and Partners' Capital 126,023,220 91,201,711
NET ASSET VALUE PER UNIT 2,185.74 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 September 30,
1997 1996
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized 3,664,017 (3,441,862)
Net change in unrealized 1,746,864 5,615,802
Total Trading Results 5,410,881 2,173,940
Interest Income (DWR) 1,170,468 751,162
Total Revenues 6,581,349 2,925,102
EXPENSES
Brokerage commissions (DWR) 1,391,910 1,018,631
Management fees 1,144,447 764,046
Incentive fees 717,178 168,692
Transaction fees and costs 131,438 83,124
Administrative expenses 11,000 11,363
Total Expenses 3,395,973 2,045,856
NET INCOME 3,185,376 879,246
NET INCOME ALLOCATION
Limited Partners 3,059,320 857,956
General Partner 126,056 21,290
NET INCOME PER UNIT
Limited Partners 131.85 22.27
General Partner 131.85 22.27
<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 Nine Months Ended September 30,
1997 1996
$ $
REVENUES
<S> <C> <C>
Trading profit:
Realized 1,147,215 1,901,203
Net change in unrealized 3,256,682 5,078,030
Total Trading Results 4,403,897 6,979,233
Interest Income (DWR) 2,940,741 2,188,401
Total Revenues 7,344,638 9,167,634
EXPENSES
Brokerage commissions (DWR) 2,964,619 2,449,366
Management fees 2,870,169 2,380,727
Incentive fees 1,126,398 643,996
Transaction fees and costs 273,861 175,299
Administrative expenses 29,000 38,363
Bank fees - 31,570
Total Expenses 7,264,047 5,719,321
NET INCOME 80,591 3,448,313
NET INCOME ALLOCATION
Limited Partners 29,969 3,374,132
General Partner 50,622 74,181
NET INCOME PER UNIT
Limited Partners 52.95 77.59
General Partners 52.95 77.59
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</page>
<PAGE>
</TABLE>
<TABLE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the Nine Months Ended September 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 - 3,374,132 74,181 3,448,313
Redemptions (5,243.154) (9,088,238) - (9,088,238)
Partners' Capital
September 30, 1996 42,148.386 $73,200,275 $1,698,845 $74,899,120
Partners' Capital
December 31, 1996 40,937.953 $85,273,194 $2,038,949 $87,312,143
Offering of Units 18,765.082 43,031,474 - 43,031,474
Net Income - 29,969 50,622 80,591
Redemptions (2,612.159) (5,638,144) - (5,638,144)
Partners' Capital
September 30, 1997 57,090.876 $122,696,493 $2,089,571 $124,786,064
<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 Nine Months Ended September 30,
1997 1996
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net income 80,591 3,448,313
Noncash item included in net income:
Net change in unrealized (3,256,682) (5,078,030)
(Increase) decrease in operating assets:
Interest receivable (DWR) (135,350) 9,476
Due from DWR (26,346) (215,200)
Increase (decrease) in operating liabilities:
Management fee payable 115,492 (17,625)
Accrued brokerage commissions (DWR) 135,566 187,257
Accrued administrative expenses (21,253) (87,422)
Accrued transaction fees and costs 12,500 15,532
Incentive fee payable (2,587,891) (149,600)
Bank fee payable - (21,336)
Net cash provided by (used for) operating activities (5,683,373) (1,908,635)
CASH FLOWS FROM FINANCING ACTIVITIES
Offering of units 43,031,474 -
Increase (decrease) in redemptions payable (306,826) 519,762
Redemptions of units (5,638,144) (9,088,238)
Net cash used for financing activities 37,086,504 (8,565,476)
Net increase (decrease) in cash 31,403,131 (10,477,111)
Balance at beginning of period 87,847,358 78,404,128
Balance at end of period 119,250,489 67,927,017
<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 for most of the
Partnership's transactions is Dean Witter Reynolds Inc. ("DWR").
Both Demeter and DWR are wholly owned subsidiaries of Morgan
Stanley, Dean Witter, Discover & Co. ("MSDWD").
On July 31, 1997, DWR closed the sale of its institutional
futures business and foreign currency trading operations to Carr
Futures Inc. ("Carr"), a subsidiary of Credit Agricole Indosuez.
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Following the sale, Carr became the counterparty on the
Partnership's foreign currency trades. However, during a
transition period of about four months, DWR will continue to
perform certain services relating to the Partnership's futures
trading including clearance. After such transaction period, DWR
will continue to serve as a non-clearing with Carr Providing all
clearing services for Partnership transactions.
2. Related Party Transactions
The Partnership's cash is on deposit with DWR and Carr 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.
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
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
significantly influence the market value of these contracts,
including interest rate volatility. At September 30, 1997 and
December 31, 1996, open contracts were:
Contract or Notional Amount
September 30, 1997 December 31,1996
$ $
Exchange-Traded Contracts
Financial Futures:
Commitments to Purchase 227,441,000 65,197,000
Commitments to Sell 118,130,000 70,325,000
Commodity Futures:
Commitments to Purchase 41,641,000 5,005,000
Commitments to Sell 30,154,000 30,977,000
Foreign Futures:
Commitments to Purchase 154,840,000 42,509,000
Commitments to Sell 12,700,000 67,755,000
Off-Exchange-Traded
Forward Currency Contracts
Commitments to Purchase 64,491,000 89,146,000
Commitments to Sell 53,079,000 38,531,000
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 $6,310,562 and
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
$3,053,880 at September 30, 1997 and December 31, 1996,
respectively. Of the $6,310,562 net unrealized gain on open
contracts at September 30, 1997, $5,995,770 related to exchange-
traded futures contracts and $314,792 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
September 30, 1997 and December 31, 1996 mature through September
1998 and December 1997, respectively. Off-exchange-traded
forward currency contracts held at September 30, 1997 and
December 31, 1996 mature through December 1997 and March 1997,
respectively. The contract amounts in the above table represent
the Partnership's extent of 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 either DWR or Carr
acts as the futures commission merchant or the counterparty, with
respect to most of the Partnership's assets. Exchange-traded
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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
$124,836,957 and $91,312,827 at September 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, the Partnership is at risk to
the ability of Carr, the sole counterparty on all of such contracts,
to perform. Carr's parent, Credit Agricole Indosuez, has
guaranteed Carr's obligations to the Partnership.
For the nine months ended September 30, 1997 and for the year
ended December 31, 1996, the average fair value of financial
instruments held for trading purposes was as follows:
<PAGE>
DEAN WITTER PORTFOLIO STRATEGY FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
September 30, 1997
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 132,617,000 108,606,000
Commodity Futures 17,136,000 31,275,000
Foreign Futures 91,586,000 41,538,000
Off-Exchange-Traded Forward
Currency Contracts 105,887,000 111,221,000
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
<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 Carr, and are used by the
Partnership as margin to engage in futures interest trading. DWR
and Carr 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 and Carr 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
<PAGE>
restrictions on redemptions. However, since the commencement of
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 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 Nine Months Ended September 30, 1997
For the quarter ended September 30, 1997, the Partnership's total
trading revenues including interest income were $6,581,349.
During the third quarter, the Partnership posted a gain in Net
Asset
<PAGE>
Value per Unit. The most significant gains were recorded in the
financial futures markets due primarily to an upward trend in
global interest rate futures prices during July and September.
In global stock index futures, gains recorded from short
positions in the Nikkei Index futures was more than offset from
trading losses recorded in Australian stock index futures. In
metals, gains were recorded from short silver and gold futures
positions during July and from long silver futures positions
during September as silver prices moved higher. A portion of the
Partnership's overall gains was offset by losses recorded in the
energy markets from trading crude and heating oil futures as oil
prices moved in a short-term volatile pattern throughout the
quarter. In soft commodities, losses were recorded from choppy
price movement during July and September, primarily from trading
coffee futures. In currencies, losses recorded from transactions
involving the British pound as its value moved in an inconsistent
pattern during the quarter, more than offset gains from short
positions in the German mark during July. Total expenses for the
quarter were $3,395,973, resulting in net income of $3,185,376.
The value of an individual Unit in the Partnership increased from
$2,053.89 at June 30, 1997 to $2,185.74 at September 30, 1997.
For the nine months ended September 30, 1997, the Partnership's
total trading revenues including interest income were $7,344,638.
During the first nine months of the year, the Partnership posted
a gain in Net Asset Value per Unit. The most significant gains
were recorded in the financial futures and metals markets. In
<PAGE>
financial futures trading, gains recorded from an upward price
trend in global interest rate futures during July and September
more than offset the losses experienced as a result of short-term
price volatility during the first four months of the year.
Additional gains were recorded from trading Nikkei Index futures
during the second and third quarter. In metals, gains were
recorded from short gold futures positions as prices decreased
during January, April, June and July. Additional gains were
recorded from trading silver futures during July and September.
A portion of the Partnership's overall gains for the first nine
months of the year was offset by losses from trading energy
futures as oil prices moved without consistent direction for a
majority of the year. In currencies, losses were recorded from
transactions involving the British pound as the value of the
pound moved in a trendless pattern during the first and third
quarters. Additional currency losses were recorded from trading
the Swiss franc during the second quarter and in August and
September. A portion of these currency losses was offset by
gains experienced during July from short German mark positions as
the value of the U.S. dollar increased versus the German mark.
Total expenses for the period were $7,264,047 resulting in net
income of $80,591. The value of an individual Unit in the
Partnership increased from $2,132.79 at December 31, 1996 to
$2,185.74 at September 30, 1997.
<PAGE>
For the Quarter and Nine Months Ended September 30, 1996
For the quarter ended September 30, 1996, the Partnership's total
trading revenues including interest income were $2,925,102.
During the third quarter, the Partnership posted an increase in
Net Asset Value per Unit. The most significant trading gains
were recorded in the financial futures markets from long
European, Japanese and Australian bond futures positions as
international interest rates futures prices moved higher between
July and September. Additional gains were recorded in the energy
markets from long crude and heating oil futures as prices in
these markets trended higher throughout the quarter. A portion
of the overall gains for the quarter was offset by losses
experienced in the currency and soft commodities. In the
currency markets, losses were recorded from short Australian
dollar positions as the value of the Australian dollar reversed
higher relative to the U.S. dollar and other world currencies and
from transactions involving the Swiss franc and German mark as
the value of these currencies moved in an inconsistent pattern.
In soft commodities, losses were recorded as a result of
trendless movement in sugar, coffee and cotton prices throughout
most of the quarter. Total expenses for the quarter were
$2,045,856, resulting in net income of $879,246. The value of an
individual Unit in the Partnership increased from $1,754.76 at
June 30, 1996 to $1,777.03 at September 30, 1996.
For the nine months ended September 30, 1996, the Partnership's
total trading revenues including interest income were $9,167,634.
<PAGE>
During the first nine months, the Partnership posted an increase
in Net Asset Value per Unit. The most significant gains were
recorded in the financial futures markets from global interest
rate futures trading during the third quarter. These gains more
than offset losses in non-U.S. interest rate futures and global
stock index futures during the first half of the year.
Additional gains were recorded in the currency markets from
transactions involving the Swiss franc, Japanese yen and German
mark during the second quarter. In the energy markets, gains
were recorded from long crude and heating oil futures as prices
increased significantly during the third quarter. In metals,
gains were recorded from short positions in gold futures as
prices moved lower during June, July and September. A portion of
the overall gains during the first nine months of the year was
offset by losses in soft commodities as coffee, sugar and cotton
prices moved in a trendless pattern throughout the year. Total
expenses for the period were $5,719,321, resulting in net income
of $3,448,313. The value of an individual Unit in the
Partnership increased from $1,699.44 at December 31, 1995 to
$1,777.03 at September 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 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
The Partnership registered 50,000 additional Units of Limited
Partnership Interest ("Units") pursuant to a Registration
Statement on Form S-1, which because effective on May 12, 1997
(the "Registration Statement") (SEC File Number 333-24109). The
managing underwriter was DWR.
The offering commenced on May 12, 1997 and terminated as of
August 1, 1997, with 18,764.225 Units sold. The aggregate price
of the offering amount registered was $111,150,000 (based upon
the approximate Net Asset Value per Unit of $2,223.00 as of March
14, 1997). The aggregate price of the Units sold at the closing
of the offering on August 1, 1997 was $43,029,508.53 (based upon
the Net Asset Value per Unit of $2,293.13 as of the close of
business on July 31, 1997).
<PAGE>
No expenses chargeable against proceeds were incurred, making net
offering proceeds $43,029,508.53, which were applied to the
working capital of the Partnership for use in accordance with the
"Use of Proceeds" section of the Prospectus included as part of
the Registration Statement.
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)
November 6, 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 reference to such financial instruments.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-END> SEP-30-1997
<CASH> 119,250,489
<SECURITIES> 0
<RECEIVABLES> 462,169<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 126,023,220<F2>
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 126,023,220<F3>
<SALES> 0
<TOTAL-REVENUES> 7,344,638<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 7,264,047
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 80,591
<INCOME-TAX> 0
<INCOME-CONTINUING> 80,591
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 80,591
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Receivables include interest receivable of $435,823 and due from DWR
of $26,346.
<F2>In addition to cash and receivables, total assets include net unrealized
gain on open contracts of $6,310,562.
<F3>Liabilities include redemptions payable of $381,289, accrued brokerage
commissions of $277,445, management fees payable of $418,620, accrued
administrative expenses of $137,257, accrued transaction fees and
costs of $22,545.
<F4>Total revenues include realized trading revenue of $1,147,215, net
change in unrealized of $3,256,682 and interest income of $2,940,741.
</FN>
</TABLE>
