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 quarterly period ended September 30, 1998 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. 0-19511
DEAN WITTER SPECTRUM SELECT L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3619290
(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
(Former name, former address, and former fiscal year, if changed
since last report)
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 SPECTRUM SELECT L.P.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
September 30, 1998
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Statements of Financial Condition
September 30, 1998 (Unaudited) and December 31, 1997....2
Statements of Operations for the Quarters Ended
September 30, 1998 and 1997 (Unaudited).................3
Statements of Operations for the Nine Months Ended
September 30, 1998 and 1997 (Unaudited).................4
Statements of Changes in Partners' Capital for the
Nine Months Ended September 30, 1998 and 1997
(Unaudited).............................................5
Statements of Cash Flows for the Nine Months Ended
September 30, 1998 and 1997 (Unaudited).................6
Notes to Financial Statements (Unaudited)............7-12
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations....13-21
Part II. OTHER INFORMATION
Item 1. Legal Proceedings...................................22
Item 2. Changes in Securities and Use of Proceeds........22-24
Item 6. Exhibits and Reports on Form 8-K....................24
</TABLE>
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
DEAN WITTER SPECTRUM SELECT L.P.
STATEMENTS OF FINANCIAL CONDITION
<CAPTION>
September 30, December 31,
1998 1997
$ $
(Unaudited)
ASSETS
<S> <C> <C>
Equity in Commodity futures trading accounts:
Cash 172,638,489 158,178,925
Net unrealized gain on open contracts 32,213,652 9,627,161
Total Trading Equity 204,852,141 167,806,086
Subscriptions receivable 3,515,676 -
Interest receivable (DWR) 598,766 638,204
Due from DWR - 1,097,517
Total Assets 208,966,583 169,541,807
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable 1,632,666 2,272,314
Incentive fees payable 1,308,547 -
Accrued brokerage fees (DWR) 1,151,853 -
Accrued management fees 476,629 423,673
Accrued administrative expenses - 7
2,499
Total Liabilities 4,569,695 2,768,486
Partners' Capital
Limited Partners (7,769,237.821 and
7,867,474.900 Units, respectively) 200,954,800 163,999,307
General Partner (133,076.700 Units) 3,442,088 2,774,014
Total Partners' Capital 204,396,888 166,773,321
Total Liabilities and Partners' Capital 208,966,583169,541,807
NET ASSET VALUE PER UNIT 25.87 20.85
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER SPECTRUM SELECT L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Quarters Ended September 30,
1998 1997
$ $
REVENUES
<S> <C> <C>
Trading profit:
Realized 18,652,736 5,198,438
Net change in unrealized 26,554,556 3,818,378
Total Trading Results 45,207,292 9,016,816
Interest Income (DWR) 1,702,214 1,881,794
Total Revenues 46,909,506 10,898,610
EXPENSES
Brokerage fees (DWR) 3,060,254 2,520,442
Incentive fees 1,828,624 -
Management fees 1,267,982 1,335,540
Transaction fees and costs - 354,668
Administrative expenses - 29,000
Total Expenses 6,156,860 4,239,650
NET INCOME 40,752,646 6,658,960
NET INCOME ALLOCATION
Limited Partners 40,056,058 6,555,582
General Partner 696,588 103,378
NET INCOME PER UNIT
Limited Partners
5.24 .78
General Partner
5.24 .78
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<page
<TABLE>
DEAN WITTER SPECTRUM SELECT L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Nine Months Ended September 30,
1998 1997
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized 25,414,460 17,548,841
Net change in unrealized 22,586,491 (628,624)
Total Trading Results 48,000,951 16,920,217
Interest Income (DWR) 5,105,202 5,592,135
Total Revenues 53,106,153 22,512,352
EXPENSES
Brokerage fees (DWR) 7,767,759 7,535,328
Management fees 3,715,645 3,988,231
Incentive fees 1,828,624 49,989
Transaction fees and costs 625,328 926,221
Administrative expenses 64,000 83,000
Total Expenses 14,001,356 12,582,769
NET INCOME 39,104,797 9,929,583
NET INCOME ALLOCATION
Limited Partners 38,436,723 9,768,879
General Partner 668,074 160,704
NET INCOME PER UNIT
Limited Partners
5.02 1.21
General Partner
5.02 1.21
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER SPECTRUM SELECT L.P.
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the Nine Months Ended September 30, 1998 and 1997
(Unaudited)
<CAPTION>
Units of
Partnership Limited General
Interest Partners Partner Total
<S> <C> <C>
<C> <C>
Partners' Capital
December 31, 1996 83,463.277 $161,174,820 $2,611,465
$163,786,285
Offering of Units 5,737.467 12,056,614 -
12,056,614
Net Income - 9,768,879 160,704
9,929,583
Redemptions (6,746.733) (14,009,517) -
(14,009,517)
Partners' Capital
September 30, 1997 82,454.011 $168,990,796 $2,772,169
$171,762,965
Partners' Capital
December 31, 19978,000,551.600 $163,999,307 $2,774,014
$166,773,321
Offering of Units 682,462.929 15,265,517 -
15,265,517
Net Income - 38,436,723 668,074
39,104,797
Redemptions (780,700.008) (16,746,747) -
(16,746,747)
Partners' Capital
September 30, 19987,902,314.521 $200,954,800 $3,442,088
$204,396,888
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER SPECTRUM SELECT L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
For the Nine Months Ended September 30,
1998 1997
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net income 39,104,797 9
,929,583
Noncash item included in net income:
Net change in unrealized (22,586,491) 628,624
(Increase) decrease in operating assets:
Interest receivable (DWR) 39,438 (65,989)
Due from DWR 1,097,517 (
342,974)
Net option premiums - 18,205
Increase (decrease) in operating liabilities:
Incentive fees payable 1,308,547 (
348,459)
Accrued brokerage fees (DWR) 1,151,853 168,172
Accrued management fees 52,956 30,408
Accrued administrative expenses (72,499) (13,222)
Accrued transaction fees and costs -
(16,841)
Net cash provided by operating activities 20,096,118
9,987,507
CASH FLOWS FROM FINANCING ACTIVITIES
Offering of Units 15,265,517
12,056,614
(Increase) decrease in subscriptions receivable(3,515,676)
5,365,420
Decrease in redemptions payable (639,648) (
860,962)
Redemptions of units (16,746,747) (
14,009,517)
Net cash provided by (used for) financing activities (
5,636,554) 2,551,555
Net increase in cash 14,459,564 1
2,539,062
Balance at beginning of period 158,178,925 1
54,784,007
Balance at end of period 172,638,489 1
67,323,069
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>
DEAN WITTER SPECTRUM SELECT 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 of Dean Witter Spectrum
Select L.P. (the "Partnership"). The financial statements and
condensed notes herein should be read in conjunction with the
Partnership's December 31, 1997 Annual Report on Form 10-K.
1. Organization
Dean Witter Spectrum Select L.P., is a limited partnership
organized to engage in the speculative trading of commodity
futures contracts and forward contracts on foreign currencies
(collectively, "futures interests"). On May 11, 1998, the
Partnership became one of the Dean Witter Spectrum Series of
funds, comprised of the Partnership, Dean Witter Spectrum Global
Balanced L.P., Dean Witter Spectrum Strategic L.P. and Dean
Witter Spectrum Technical L.P. The general partner is Demeter
Management Corporation ("Demeter"). The non-clearing commodity
broker is Dean Witter Reynolds, Inc. ("DWR"), an affiliate of
Demeter. The clearing commodity broker is Carr Futures Inc.
("Carr"), providing clearing and execution services. Both Demeter
and DWR are wholly-owned subsidiaries of Morgan Stanley Dean
Witter & Co. ("MSDW"). Demeter has retained as trading advisors
to the Partnership, EMC Capital Management, Inc., Rabar Market
Research, Inc. and Sunrise Capital Management, Inc. (the "Trading
Advisors").
<PAGE>
DEAN WITTER SPECTRUM SELECT L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
2. Summary of Significant Accounting Policies
Effective June 1, 1998, the incentive fee rate payable to the
Trading Advisors was reduced to 15% of Trading Profits, as
defined in the Prospectus, and made payable on a monthly basis.
In addition, the Partnership's brokerage and transaction
expenses, formerly accrued on a transaction basis, were changed
to a flat monthly rate of 1/12 of 7.25% of Net Assets as of the
first day of each month and covers all brokerage commissions,
transaction fees and costs and ordinary administrative and
continuing offering expenses.
3. Related Party Transactions
The Partnership's cash is on deposit with DWR and Carr in futures
interest 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.
4. Financial Instruments
The Partnership trades futures, options and forward contracts in
interest rates, stock indices, commodities and currencies.
Futures and forwards represent contracts for delayed delivery of
an instrument at a specified date and price. Risk arises from
<PAGE>
DEAN WITTER SPECTRUM SELECT L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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 September 30, 1998 and December 31, 1997,
open contracts were:
Contract or Notional Amount
September 30, 1998 December 31, 1997
$ $
Exchange-Traded Contracts
Financial Futures:
Commitments to Purchase 910,349,000 428,493,000
Commitments to Sell 17,635,000 173,316,000
Commodity Futures:
Commitments to Purchase 37,369,000 23,131,000
Commitments to Sell 28,694,000 135,389,000
Foreign Futures:
Commitments to Purchase 2,394,200,000 997,389,000
Commitments to Sell 124,350,000 315,676,000
Off-Exchange-Traded
Forward Currency Contracts
Commitments to Purchase 105,273,000 96,671,000
Commitments to Sell 33,766,000 127,065,000
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.
<PAGE>
DEAN WITTER SPECTRUM SELECT L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The net unrealized gain on open contracts is reported as a
component of "Equity in Commodity futures trading accounts" on
the Statements of Financial Condition and totaled $32,213,652 and
$9,627,161 at September 30, 1998 and December 31, 1997,
respectively.
Of the $32,213,652 net unrealized gain on open contracts at
September 30, 1998, $30,652,051 related to exchange-traded
futures contracts and $1,561,601 related to off-exchange-traded
forward currency contracts.
Of the $9,627,161 net unrealized gain on open contracts at
December 31, 1997, $10,514,844 related to exchange-traded futures
contracts and $(887,683) related to off-exchange-traded forward
currency contracts.
Exchange-traded futures contracts held by the Partnership at
September 30, 1998 and December 31, 1997 mature through September
1999 and December 1998, respectively. Off-exchange-traded
forward currency contracts held at September 30, 1998 and
December 31, 1997 mature through December 1998 and March 1998,
respectively.
The contract amounts in the above table represent the
Partnership's extent of involvement in a particular class of
financial instrument, but not the credit risk associated with
<PAGE>
DEAN WITTER SPECTRUM SELECT L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
counterparty non-performance. 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 and Carr act as
the futures commission merchants or the counterparties, with
respect to most of the Partnership's assets. Exchange-traded
futures and futures styled options contracts are marked to market
on a daily basis, with variations in value settled on a daily
basis. Each of DWR and Carr, as a futures commission merchant
for the Partnership's exchange-traded futures and futures styled
options contracts, are required, pursuant to regulations of the
Commodity Futures Trading Commission ("CFTC"), to segregate from
their own assets and for the sole benefit of their commodity
customers, all funds held by them with respect to exchange-traded
futures and futures styled options contracts, including an amount
equal to the net unrealized gain on all open futures and futures
styled options contracts, which funds, in the aggregate, totaled
$203,290,540 and $168,693,769 at September 30, 1998 and December
31, 1997, 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 contracts
be segregated. With respect to those off-exchange-traded forward
<PAGE>
DEAN WITTER SPECTRUM SELECT L.P.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
currency contracts, the Partnership is at risk to the ability of
Carr, the sole counterparty on all such contracts, to perform.
Carr's parent, Credit Agricole Indosuez, has guaranteed to the
Partnership payment of the net liquidating value of the
transactions in the Partnership's account with Carr (including
foreign currency contracts).
For the nine months ended September 30, 1998 and the year ended
December 31, 1997, the average fair value of financial
instruments held for trading purposes was as follows:
September 30, 1998
Assets
Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 463,575,000 218,285,000
Options on Financial Futures 2,032,000 -
Commodity Futures 23,713,000 78,242,000
Options on Commodity Futures 65,000 -
Foreign Futures 1,213,201,000 464,465,000
Off-Exchange-Traded Forward
Currency Contracts 149,349,000 149,619,000
December 31,1997
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 363,272,000
243,761,000
Options on Financial Futures 3,781,000 -
Commodity Futures 95,455,000
76,233,000
Options on Commodity Futures 2,484,000
1,789,000
Foreign Futures 360,391,000
382,135,000
Off-Exchange-Traded Forward
Currency Contracts 41,814,000
40,388,000
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity - Assets of the Partnership are deposited with DWR as
non-clearing broker and Carr as clearing broker in separate
futures interest trading accounts established for each Trading
Advisor and are used by the Partnership as margin to engage in
futures interest trading. Such assets are held in either non-
interest bearing bank accounts 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 for a particular futures interest
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.
There is no limitation on daily price moves in trading forward
contracts on foreign currency. 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. Future redemptions,
exchanges and sales of additional Units of Limited Partnership
Interest will affect the amount of funds available for investment
in futures interests in subsequent periods. Since they are at
the discretion of Limited Partners, it is not possible to
estimate the amount and therefore, the impact of future
redemptions, exchanges or sales of additional Units.
Results of Operations
For the Quarter and Nine Months Ended September 30, 1998
For the quarter ended September 30, 1998, the Partnership
recorded total trading revenues including interest income of
$46,909,506 and posted an increase in Net Asset Value per Unit.
The most significant gains were recorded in the financial futures
markets from long positions in U.S., European (particularly
German and French), and Japanese interest rate futures positions
as investors
<PAGE>
flocked to the perceived "safe haven" investments amid the recent
global economic and political uncertainty. Additional gains were
recorded in the agricultural markets primarily from short corn
futures positions as grain prices declined during July and August
on reports of abundant supplies and decreasing demand. In
currencies, smaller gains were produced from short Canadian
dollar positions during July and August as the value of this
currency reached its lowest level ever versus the U.S. dollar.
Transactions involving the Mexican peso and the German mark
contributed smaller currency gains during September. In the
energy markets, short unleaded gas futures positions resulted in
profits as gas prices dropped during July and August due to
continued inventory increases. A portion of the Partnership's
overall gains for the quarter was offset by losses recorded in
the metals markets primarily from short gold futures positions
held during September as precious metals prices jumped higher due
to the U.S. dollar's weakness. Likewise, short silver futures
positions resulted in smaller losses. Short positions in base
metals futures also resulted in losses as prices moved higher in
early July. In the soft commodities markets, long positions in
coffee futures produced losses during August as coffee prices
fell on increased supply and shrinking demand. Total expenses
for the three months ended September 30, 1998 were $6,156,860,
resulting in net income of $40,752,646. The value of an
individual Unit in the Partnership increased from 20.63 at June
30, 1998 to 25.87 at September 30, 1998.
<PAGE>
For the nine months ended September 30, 1998, the Partnership
recorded total trading revenues including interest income of
$53,106,153 and posted an increase in Net Asset Value per Unit.
The most significant gains were recorded in the financial futures
markets from long European (particularly German and French), and
U.S. interest rate futures positions as prices in these markets
soared during the last quarter. Smaller gains were recorded in
this market complex from short positions in global stock index
futures, particularly German, U.S. and French stock index
futures, as equity prices around the world moved significantly
lower during August. Smaller gains were produced in the energy
markets as short crude oil futures positions benefited from price
drops in oil during January, February, June, July and August.
The agricultural markets contributed smaller gains from short
positions in soybean meal futures during the first quarter. A
portion of the Partnership's overall gains was offset by losses
in the metals markets resulting from choppy price movement in
silver and gold futures during the first quarter, as well as
losses during September from short positions as precious metals
prices moved sharply higher. Similarly, trading in copper
futures created losses during a majority of the first half of the
year from trendless price movement, as well as losses recorded
during July from short positions as base metals prices moved
higher early in the month. In the currency markets, transactions
involving the British pound resulted in losses as its value moved
without consistent direction during a majority of the first nine
months of
<PAGE>
the year. Additional currency losses resulted from trading in
the Swiss franc during July and August and the Japanese yen
during September. The soft commodities markets recorded smaller
losses from cotton futures trading due to weather related
volatility in cotton prices during August, offsetting first
quarter gains from short sugar futures positions. Total expenses
for the nine months ended September 30, 1998 were $14,001,356,
resulting in net income of $39,104,797. The value of an
individual Unit in the Partnership increased from 20.85 at
December 31, 1997 to 25.87 at September 30, 1998.
For the Quarter and Nine Months Ended September 30, 1997
For the quarter ended September 30, 1997, the Partnership
recorded total revenues including interest income of $10,898,610
and posted an increase in Net Asset Value per Unit. The most
significant gains were recorded in financial futures due
primarily to an upward trend in global interest rate futures
during July and September. Smaller profits were recorded in
global stock index futures from short Nikkei Index futures during
the quarter. In the currency markets, gains were recorded during
July from short German mark positions as the value of the U.S.
dollar increased versus the German mark. Additional currency
gains were recorded from transactions involving the French and
Swiss franc. In metals, gains were recorded from short gold
futures positions as prices declined during July. A portion of
the Partnership's overall gains for the third quarter was offset
by losses recorded in the agricultural and soft commodities
markets as a result of short-term volatile price movement in a
majority of the markets
<PAGE>
traded, particularly, corn, soybean meal and cotton futures.
Smaller losses were recorded in energies from trading heating and
crude oil futures as oil prices moved without consistent
direction during the quarter. Total expenses for the three
months ended September 30, 1997 were $4,239,650, resulting in net
income of $6,658,960. The value of an individual Unit in the
Partnership increased from $20.05 at June 30, 1997 to $20.83 at
September 30, 1997.
For the nine months ended September 30, 1997, the Partnership
recorded total trading revenues including interest income of
$22,512,352 and posted an increase in Net Asset Value per Unit.
The most significant gains were recorded in the currency markets
as the value of the U.S. dollar increased relative to most world
currencies during the first and third quarters of the year.
Additional gains were recorded from long positions in global
stock index futures as prices in these markets increased during
the second quarter and July. Trading gains were also recorded
from long Australian bond futures positions during May, June,
July and September, and from long Japanese bond futures positions
during the third quarter. Smaller profits were recorded in soft
commodities from long coffee futures positions as coffee prices
trended higher from January through May. 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 and gas
prices moved without consistent direction for a majority of the
year. One exception in the energy complex was natural gas
futures prices, which increased steadily during the third
<PAGE>
quarter, thus resulting in gains from long positions. In metals,
losses experienced from trading base metals futures during the
second quarter more than offset gains from trading gold and zinc
futures. Total expenses for the nine months ended September 30,
1997 were $12,582,769, resulting in net income of $9,929,583.
The value of an individual Unit in the Partnership increased from
$19.62 at December 31, 1996 to $20.83 at September 30, 1997.
Year 2000 Problem - Commodity pools, like financial and business
organizations and individuals around the world, depend on the
smooth functioning of computer systems. Many computer systems in
use today cannot recognize the computer code for the year 2000,
but revert to 1900 or some other date. This is commonly known as
the "Year 2000 Problem". The Partnership could be adversely
affected if computer systems used by it or any third party with
whom it has a material relationship do not properly process and
calculate date-related information and data concerning dates on
or after January 1, 2000. Such a failure could have a negative
impact on the handling or determination of futures trades and
prices and the services provided the Partnership.
MSDW began its planning in response to the Year 2000 Problem in
1995 and currently has several hundred employees working on such
response. It has developed its own Year 2000 compliance plan to
deal with the problem and had the plan approved by the company's
executive management, Board of Directors and Information
Technology Department. Demeter is coordinating with MSDW in
taking steps that both believe are reasonably designed to address
<PAGE>
the Year 2000 Problem with respect to Demeter's computer systems
that relate to the Partnership. This includes hardware and
software upgrades, systems consulting and computer maintenance.
Beyond the challenge facing internal computer systems, the
systems failure of any of the third parties with whom the
Partnership has a material relationship - the futures exchanges
and clearing organizations through which it trades, Carr, or the
Trading Advisors - could result in a material financial risk to
the Partnership. Regarding the futures exchanges, all U.S.
futures exchanges will be subject to the monitoring of the CFTC
for their Year 2000 preparedness and the major foreign futures
exchanges are also expected to be subject to market-wide testing
of their Year 2000 compliance during 1999. With respect to Carr
and the Trading Advisors, Demeter intends to monitor their
progress throughout 1999 in their Year 2000 compliance and, where
applicable, to test its external interface with Carr and the
Trading Advisors.
Finally, MSDW has begun developing various "contingency plans" in
the event that the systems of such third parties fail, and
Demeter intends to consult closely with MSDW in implementing
those plans. MSDW has also recently reported that its
development of such contingency plans is proceeding on schedule.
Despite the best efforts of both Demeter and MSDW, however, there
can be no assurance that the above steps will be sufficient to
avoid any adverse impact to the Partnership, whether from
<PAGE>
failures in their own computer systems or those of Carr, the
Trading Advisors or any other third party.
Risks Associated with the Euro - On January 1, 1999, eleven
countries in the European Union intend to establish fixed
conversion rates on their existing sovereign currencies and
convert to a common single currency (the "euro"). During a three-
year transition period, the existing sovereign currencies will
continue to exist but only as a fixed denomination of the euro.
Conversion to the euro will prevent the Trading Advisors from
trading in certain currencies and thereby limit its ability to
take advantage of potential market opportunities that might
otherwise have existed had separate currencies been available to
trade, and could result in losses with respect to those
positions.
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
Previously reported. See Form 10-Q for the quarter ended March
31, 1998.
Item 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
The Partnership initially registered 60,000 Units (prior to the
100 for one Unit conversion on April 30, 1998) of Limited
Partnership Interest ("Units") pursuant to a Registration
Statement on Form S-1, which became effective on May 17, 1991
(SEC File Number 33-39667), and 10,000 (pre-conversion) Units at
a supplemental closing pursuant to a new Registration Statement
on Form S-1, which became effective on August 23, 1991 (SEC File
No. 33-42380). The offering commenced on May 17, 1991 and
terminated as of August 31, 1991, with 60,853.334 Units sold.
The aggregate price of the offering amount registered was
$69,380,300, based upon the initial offering price of $1,000 per
Unit and $938.03 per Unit at the supplemental closing (the
initial closing and supplemental closing, hereinafter, the
"Initial Offering"). The aggregate offering price of the Units
sold during the Initial Offering was $60,268,482.
The Partnership registered an additional 75,000 Units (pre-
conversion) pursuant to a new Registration Statement on Form S-1,
which became effective on August 31, 1993 (SEC File Number 33-
65072) (the "Second Offering"). The Second Offering commenced on
August 31, 1993 and terminated as of September 30, 1993, with
74,408.337 Units sold. The aggregate price of the Second
Offering
<PAGE>
amount registered was $102,744,000, based upon an initial
offering price of $1,369.92. The aggregate price of the Units
sold during the Second Offering was $116,617,866.
The Partnership registered an additional 60,000 Units (pre-
conversion) pursuant to another Registration Statement on Form
S-1, which became effective on October 17, 1996 (SEC File Number
333-1918), (the "Third Offering"). The Third Offering commenced
on October 17, 1996 and terminated as of March 3, 1997, with
10,878.000 Units sold. The aggregate price of the Third Offering
amount registered was $98,247,000, based upon an initial offering
price of $1,637.45. The aggregate price of the Units sold during
the Third Offering was $22,308,326.
The Partnership registered an additional 1,500,000 Units pursuant
to another Registration Statement on Form S-1, which became
effective on May 11, 1998 (SEC File Number 333-47829).
Commencing with the April 30, 1998 monthly closing, each
previously outstanding Unit was converted into 100 Units.
Thereafter, commencing with the May 31, 1998 monthly closing,
Units are being sold at monthly closings (the "Continuing
Offering") as of the last day of each month at a price equal to
100% of the Net Asset Value of a Unit as of the date of such
monthly closing. As of September 30, 1998, 682,462.929 Units
were sold during the continuing offering, leaving 817,537.071
Units unsold as of September 30, 1998. The aggregate price of
the Units sold from May 31, 1998 through September 30, 1998 is
$15,265,517.
<PAGE>
Since DWR has paid all expenses of the Initial Offering, Second
Offering, Third Offering and Continuing Offerings, and no other
expenses are chargeable against proceeds, 100% of the proceeds of
the offering have been 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 each Registration
Statement.
Item 6. Exhibits and Reports on Form 8-K
Reports on Form 8-K - No reports have been filed for the quarter
ended September 30, 1998.
<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 Spectrum Select
L.P. (Registrant)
By: Demeter Management Corporation
(General Partner)
November 12, 1998 By:/s/ Lewis A. Raibley, III
Lewis A. Raibley, III
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 Spectrum Select L.P. and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 172,638,489
<SECURITIES> 0
<RECEIVABLES> 4,114,442<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 208,966,583<F2>
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 208,966,583<F3>
<SALES> 0
<TOTAL-REVENUES> 53,106,153<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 14,001,356
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 39,104,797
<INCOME-TAX> 0
<INCOME-CONTINUING> 39,104,797
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 39,104,797
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Receivables include interest receivable of $598,766 and
subscriptions receivable of $3,515,676.
<F2>In addition to cash and receivables, total assets include net
unrealized gain on open contracts of $32,213,652.
<F3>Liabilities include redemptions payable of $1,632,666,
accrued brokerage fees of $1,151,853, acrued management fees
of $476,629, and incentive fee payable of $1,308,547.
<F4>Total revenue includes realized trading revenue of $25,414,460,
net change in unrealized of $22,586,491 and interest income of
$5,105,202.
</FN>
</TABLE>
