Morgan Stanley Dean Witter Spectrum Series
Monthly Report
April 2000
Dear Limited Partner:
The Net Asset Value per Unit for each of the five Morgan Stanley Dean
Witter Spectrum Funds as of April 30, 2000 was as follows:
Funds N.A.V. % change for month
Spectrum Commodity $ 7.42 -3.12%
Spectrum Global Balanced $15.86 -4.57%
Spectrum Select $20.86 -3.78%
Spectrum Strategic $11.15 -10.20%
Spectrum Technical $14.09 -4.00%
In general, the performance disparity between the Funds in the Spectrum
Series is due to the portfolio structure and trading approaches unique to
each fund. Spectrum Commodity, formerly Morgan Stanley Dean Witter
Tangible Asset Fund, experienced losses primarily from long positions in
the agricultural, soft commodities and metals markets. Spectrum Global
Balanced, a balanced portfolio of stocks, bonds and managed futures,
incurred losses primarily in global stock index futures, particularly from
long positions in Nikkei Index futures. Spectrum Select and Spectrum
Technical, both technically-based multi-manager funds, recorded losses from
long positions in the global stock indices and interest rate futures
markets, particularly from U.S. and Japanese stock indices and U.S.
interest rate futures. Spectrum Strategic, a fund managed by multiple
trading advisors who employ fundamental trading methodologies, experienced
losses primarily in the metals markets from long positions in aluminum and
copper futures. Additional losses were incurred by Spectrum Strategic in
the global interest rate and stock index futures markets.
Spectrum Commodity
The Fund decreased in value during April due primarily to losses recorded
in agricultural markets from long positions in corn futures as prices
dropped due to rapid spring plantings and rain in the U.S. Midwest. In
soft commodities, losses were experienced from long cotton futures
positions as cotton prices declined at month-end breaking through several
key chart support areas and triggering heavy speculative sell-stops. In
the metals markets, losses were incurred from long positions in aluminum
and copper futures as prices declined to a 6-month low on technically based
selling during the first half of the month. A portion of these losses was
offset by gains recorded in the energy markets from long natural gas
futures positions as gas prices jumped amid indications that warmer weather
in the southwestern and some south-central sections of the U.S. will induce
higher-than-usual demand for supplemental cooling.
Spectrum Global Balanced
The Fund experienced losses in April, suffering from a decline in world
equity prices and a general rise in global interest rates. The long/short
global asset overlay experienced its first negative month since October
1999. Long positions in U.S. and Australian financials and Japanese yen,
and short positions in industrial metals detracted from performance.
Conversely, short positions in the euro and euro/British pound cross rate
added value. Exposure to the Nikkei 225, FTSE 100, DAX 30, and S&P 500
indices produced negative results for the hedged equity strategy, as each
market index suffered a sharp retracement. The hedged fixed income
strategy was adversely affected by rising interest rates, especially in the
U.S. and Germany. The Fund suffered from exposure to longer duration fixed
income instruments, which declined more than their shorter duration
counterparts.
Spectrum Strategic
The Fund decreased in value during April due primarily to losses recorded
in the metals markets from long positions in aluminum and copper futures as
prices declined on technical factors and partly due to the volatility in
the U.S. equity markets. In the global interest rate futures markets,
losses were incurred from long positions in U.S. interest rate futures as
prices declined amid fears of higher interest rates and a late month bounce
in equity prices. In soft commodities,
<PAGE>
losses were experienced earlier in the month from long coffee futures
positions as prices fell to 6-month lows on technically based selling. In
the global stock index futures markets, losses were recorded from long
positions in Nikkei Index futures as Japanese equity prices, particularly
technology issues, declined sharply following the downward move of U.S.
stock prices. In the currency markets, losses were recorded from long
positions in the Japanese yen as the value of the yen weakened versus the
U.S. dollar amid fears of additional Bank of Japan (BOJ) intervention,
following the BOJ's surprise yen-selling on Monday, April 3. The yen was
also pressured lower by the present uncertainties around the immediate
leadership of Japan's government and the implications that would have for
the Japanese economy.
Spectrum Select
The Fund decreased in value during April due primarily to losses recorded
in the global stock index futures markets. In the U.S., domestic equity
prices declined sharply during mid-month, particularly on Friday, April 14,
when they plunged sharply following the release of an unexpected jump in
the consumer price index. In the global interest rate futures markets,
losses were incurred from long positions in U.S. interest rate futures as
prices declined amid fears of higher interest rates and a late month bounce
in equity prices. In the agricultural markets, losses were incurred from
long positions in corn futures as prices dropped due to rapid spring
plantings and rain in the U.S. Midwest. In the energy markets, losses were
incurred from short-term price volatility in crude oil futures as questions
regarding future production levels remained in question. A portion of
these losses was offset by gains recorded in the currency markets from
short positions in the euro as the value of the European common currency
dropped to record lows versus the U.S. dollar and British pound. The
euro's fall during the month was attributed to the European Central Bank's
(ECB) passive stance towards its currency and increasing concern that the
ECB should be more aggressive in combating inflation.
Spectrum Technical
The Fund decreased in value during April due primarily to losses recorded
in the global stock index futures markets. Losses were incurred from long
positions in Nikkei Index futures as Japanese equity prices, particularly
technology issues, declined sharply following the downward move of U.S.
stock prices. In the global interest rate futures markets, losses were
incurred from long positions in U.S. interest rate futures as prices
declined amid fears of higher interest rates and a late month bounce in
equity prices. In the energy markets, losses were incurred from short-term
price volatility in crude oil futures as questions regarding future
production levels remained in question. A portion of these losses was
offset by gains recorded in the currency markets from short positions in
the euro as the value of the European common currency dropped to record
lows versus the U.S. dollar and British pound. Strong economic data out of
the U.S. and the potential for aggressive rate hikes in the U.S. also
boosted the dollar and, subsequently, added to the euro's troubles.
Should you have any questions concerning this report, please feel free to
contact Demeter Management Corporation at Two World Trade Center, 62nd
Floor, New York , NY 10048, or your Morgan Stanley Dean Witter Financial
Advisor.
I hereby affirm, that to the best of my knowledge and belief, the
information contained in this report is accurate and complete. Past
performance is not a guarantee of future results.
Sincerely,
Robert E. Murray
Chairman
Demeter Management Corporation
General Partner
<PAGE>
<TABLE>
Historical Fund Performance
Presented below is the percentage change in Net Asset Value per Unit from
the start of each calendar each the Fund has traded. Also provided is the
inception-to-date return and the annualized return since inception for each
Fund. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
<CAPTION>
Funds Year Return
<S> <C> <C>
Spectrum Commodity
1998 -34.3%
1998 15.8%
2000 (4 months) -2.5%
Inception-to-Date Return: -25.8%
Annualized Return: -12.0%
___________________________________________________________________________
__________
Spectrum Global Balanced
1994 (2 months) -1.7%
1995 22.8%
1996 -3.6%
1997 18.2%
1999 16.4%
1999 0.8%
2000 (4 months) -1.6%
Inception-to-Date Return: 58.6%
Annualized Return: 8.8%
___________________________________________________________________________
__________
Spectrum Select
1991 (5 months) 31.2%
1992 -14.4%
1993 41.6%
1994 -5.1%
1995 23.6%
1996 5.3%
1997 6.2%
1998 14.2%
1999
-7.6%
2000 (4 months) -5.2%
Inception-to-Date Return: 108.6%
Annualized Return 8.8%
___________________________________________________________________________
________
Spectrum Strategic
1994 (2 months) 0.1%
1995 10.5%
1996 -3.5%
1997 0.4%
1998 7.8%
1999
37.2%
2000 (4 months) -29.6%
Inception-to-Date Return: 11.5%
Annualized Return: 2.0%
___________________________________________________________________________
__________
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Spectrum Technical
<S> <C> <C>
1994 (2 months) -2.2%
1995 17.6%
1996 18.3%
1997 7.5%
1998 10.2%
1999
-7.5%
2000 (4 months) -5.5%
Inception-to-Date Return: 40.9%
Annualized Return: 6.4%
</TABLE>
<PAGE>
<TABLE>
Morgan Stanley Dean Witter Spectrum Series
Statements of Operations
For the Month Ended April 30, 2000
(Unaudited)
<CAPTION>
Morgan Stanley Dean Witter Morgan Stanley Dean
Witter Morgan Stanley Dean Witter
Spectrum Commodity Spectrum Global
Balanced _ Spectrum Select
Percent of Percent of
Percent of
April 1, 2000 April 1, 2000
April 1, 2000
Beginning Beginning
Beginning
Amount Net Asset Value Amount Net Asset
Value Amount Net Asset Value
$ % $ %
$ %
REVENUES
<S> <C> <C>
<C> <C> <C> <C>
Trading profit (loss):
Realized (784,612) (3.47) 167,359 0.29
(8,442,857) (3.99)
Net change in unrealized 130,777 0.58 (2,836,038) (4.83)
1,478,465 0.70
Total Trading Results (653,835) (2.89) (2,668,679) (4.54)
(6,964,392) (3.29)
Interest Income (DWR) 83,447 0.37 272,179 0.46
763,040 0.36
Total Revenues (570,388) (2.52) (2,396,500) (4.08)
(6,201,352) (2.93)
EXPENSES
Brokerage fees (DWR) 86,601 0.39 225,033 0.38
1,279,132 0.60
Management fees 47,066 0.21 61,150
0.11 529,296 0.25
Total Expenses 133,667 0.60 286,183 0.49
1,808,428 0.85
NET LOSS (704,055) (3.12) (2,682,683) (4.57)
(8,009,780) (3.78)
Morgan Stanley Dean Witter Spectrum Series
Statements of Changes in Net Asset Value
For the Month Ended April 30, 2000
(Unaudited)
Morgan Stanley Dean Witter Morgan Stanley Dean
Witter Morgan Stanley Dean Witter
Spectrum Commodity Spectrum Global
Balanced Spectrum Select .
Units Amount Per Unit Units Amount
Per Unit Units Amount Per Unit
$ $ $ $
<S> <C> <C> <C>
<C> <C> <C> <C> <C> <C>
Net Asset Value,
April 1, 2000 2,951,734.304 22,591,461 7.65 3,532,347.415
58,704,709 16.62 9,765,399.907 211,718,422 21.68
Net Loss - (704,055) (0.23) -
(2,682,683) (0.76) - (8,009,780) (0.82)
Redemptions (148,695.330) (1,103,319) 7.42 (86,245.986)
(1,367,861) 15.86 (158,210.679) (3,300,275) 20.86
Subscriptions 34,986.389 259,599 7.42 76,086.336
1,206,729 15.86 108,394.668 2,261,113 20.86
Net Asset Value,
April 30, 2000 2,838,025.363 21,043,686 7.42 3,522,187.765
55,860,894 15.86 9,715,583.896 202,669,480 20.86
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
Morgan Stanley Dean Witter Spectrum Series
Statements of Operations
For the Month Ended April 30, 2000
(Unaudited)
<CAPTION>
Morgan Stanley Dean Witter Morgan Stanley
Dean Witter
Spectrum Strategic
Spectrum Technical .
Percent of Percent of
April 1, 2000 April 1, 2000
Amount Net Asset Value Amount
Net Asset Value
$ % $
%
REVENUES
<S> <C> <C>
<C> <C>
Trading profit (loss):
Realized (4,286,773) (4.88) (16,592,670)
(6.31)
Net change in unrealized (4,291,038) (4.89) 7,589,807
2.89
Total Trading Results (8,577,811) (9.77) (9,002,863)
(3.42)
Interest Income (DWR) 319,748 0.36 959,370
0.37
Total Revenues (8,258,063) (9.41) (8,043,493)
(3.05)
EXPENSES
Brokerage fees (DWR) 461,717 0.52 1,587,715
0.61
Management fees 238,389 0.27 875,980
0.34
Total Expenses 700,106 0.79 2,463,695
0.95
NET LOSS (8,958,169) (10.20) (10,507,188)
(4.00)
Morgan Stanley Dean Witter Spectrum Series
Statements of Changes in Net Asset Value
For the Month Ended April 30, 2000
(Unaudited)
Morgan Stanley Dean Witter Morgan
Stanley Dean Witter
Spectrum Strategic Spectrum
Technical .
Units Amount Per Unit Units
Amount Per Unit
$ $ $
$
<S> <C> <C> <C>
<C> <C> <C>
Net Asset Value,
April 1, 2000 7,075,976.671 87,835,285 12.41 17,906,455.759
262,794,198 14.68
Net Loss - (8,958,169) (1.26) -
(10,507,188) (0.59)
Redemptions (99,508.743) (1,109,522) 11.15 (269,738.509)
(3,800,616) 14.09
Subscriptions 127,059.830 1,416,717 11.15 181,353.373
2,555,269 14.09
Net Asset Value,
April 30, 2000 7,103,527.758 79,184,311 11.15 17,818,070.623
251,041,663 14.09
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
Morgan Stanley Dean Witter Spectrum Series
Notes to Financial Statements
(Unaudited)
1. Summary of Significant Accounting Policies
Organization - Morgan Stanley Dean Witter Spectrum Commodity
L.P. ("Spectrum Commodity," formerly Morgan Stanley Tangible
Asset Fund L.P.), Morgan Stanley Dean Witter Spectrum Global
Balanced L.P. ("Spectrum Global Balanced"), Morgan Stanley Dean
Witter Spectrum Select L.P. ("Spectrum Select"), Morgan Stanley
Dean Witter Spectrum Strategic L.P. ("Spectrum Strategic") and
Morgan Stanley Dean Witter Spectrum Technical L.P. ("Spectrum
Technical"), (individually, a "Partnership", or collectively,
the "Partnerships"), are limited partnerships organized to
engage primarily in the speculative trading of futures and
forward contracts, options on futures contracts, physical
commodities and other commodity interests, including, but not
limited to foreign currencies, financial instruments, metals,
energy and agricultural products (collectively, "futures
interests").
The general partner for each Partnership is Demeter Management
Corporation ("Demeter"). The non-clearing commodity broker for
Spectrum Global Balanced, Spectrum Select, Spectrum Strategic
and Spectrum Technical is Dean Witter Reynolds, Inc. ("DWR")
and an unaffiliated clearing commodity broker, Carr Futures
Inc. ("Carr"), provides clearing and execution services. The
commodity brokers for Spectrum Commodity are Morgan Stanley &
Co. Incorporated ("MS & Co.") and Morgan Stanley & Co.
International Limited ("MSIL"). Morgan Stanley Dean Witter
Commodities Management, Inc. ("MSDWC") is the trading advisor
to Spectrum Commodity. Demeter, DWR, MS& Co., MSDWC and MSIL
are wholly-owned subsidiaries of Morgan Stanley Dean Witter &
Co.
Demeter is required to maintain a 1% minimum interest in the
equity of each Partnership and income (losses) are shared by
Demeter and the Limited Partners based upon their proportional
ownership interests.
Use of Estimates - The financial statements are prepared in
accordance with generally accepted accounting principles, which
require management to make estimates and assumptions that
affect the reported amounts in the financial statements and
related disclosures. Management believes that the estimates
utilized in the preparation of the financial statements are
prudent and reasonable. Actual results could differ from those
estimates.
Revenue Recognition - Futures interests are open commitments
until settlement date. They are valued at market on a daily
basis and the resulting net change in unrealized gains and
losses is reflected in the changes in unrealized profits
(losses) on open contracts from one period to the next in the
statements of operations. Monthly, DWR pays interest income on
80% of the month's average daily "Net Assets" (as defined in
the limited partnership agreements) of Spectrum Select,
Spectrum Strategic and Spectrum Technical, and 100% in the case
of Spectrum Global Balanced. MS & Co. credits Spectrum
Commodity at each month-end with interest income on 80% of the
Partnership's average daily Net Assets for the month. The
interest rates used are equal to a prevailing rate on U.S.
Treasury bills. For purposes of such interest payments, Net
Assets do not include monies due the Partnerships on futures
interests, but not actually received.
Net Income (Loss) per Unit - Net income (loss) per unit of
limited partnership interest ("Unit(s)") is computed using the
weighted average number of Units outstanding during the period.
<PAGE>
Morgan Stanley Dean Witter Spectrum Series
Notes to Financial Statements
(Continued)
Brokerage and Related Transaction Fees and Costs - Brokerage
fee for Spectrum Commodity is accrued at a flat monthly rate of
1/12 of 3.65% (a 3.65% annual rate) of Net Assets as of the
first day of each month.
The brokerage fee for Spectrum Global Balanced is accrued at a
flat monthly rate of 1/12 of 4.60% (a 4.60% annual rate) of Net
Assets as of the first day of each month.
Brokerage fees for Spectrum Select, Spectrum Strategic and
Spectrum Technical are accrued at a flat monthly rate of 1/12
of 7.25% (a 7.25% annual rate) of Net Assets as of the first
day of each month.
Such fees currently cover all brokerage fees, transaction fees
and costs and ordinary administrative and continuing offering
expenses.
Operating Expenses - The Partnerships incur monthly management
fees and may incur incentive fees. All common administrative
and continuing offering expenses including legal, auditing,
accounting, filing fees and other related expenses are borne by
DWR through the brokerage fees paid by each Partnership.
Service Fee - Spectrum Commodity pays Demeter a monthly service
fee equal to 1/12 of 1% (a 1% annual rate) of Net Assets as of
the first day of each month.
Income Taxes - No provision for income taxes has been made in
the accompanying financial statements, as partners are
individually responsible for reporting income or loss based
upon their respective share of each Partnership's revenues and
expenses for income tax purposes.
Distributions - Distributions, other than redemptions of Units,
are made on a pro-rata basis at the sole discretion of Demeter.
No distributions have been made to date.
Continuing Offering - Units of each Partnership are offered at
a price equal to 100% of the Net Asset Value per Unit as of the
close of business on the last day of the month. No selling
commissions or charges related to the continuing offering of
Units are borne by the Limited Partners or the Partnership.
DWR will pays all such costs.
Redemptions - Limited Partners may redeem some or all of their
Units at 100% of the Net Asset Value Per Unit as of the end of
the last day of any month that is at least six months after the
closing at which a person becomes a Limited Partner, upon five
business days advance notice by redemption form to Demeter.
Thereafter, Units redeemed on or prior to the last day of the
twelfth month after such Units were purchased will be subject
to a redemption charge equal to 2% of the Net Asset Value of a
Unit on the date of such redemption. Units redeemed after the
last day of the twelfth month and on or prior to the last day
of the twenty-fourth month after which such Units were
purchased will be subject to a redemption charge equal to 1% of
the Net Asset Value of a Unit on the date of such redemption.
Units redeemed after the last day of the twenty-fourth month
after which such Units were purchased will not be subject to a
redemption charge. The foregoing redemptions charges will be
paid to DWR. Redemptions must be made in whole Units, in a
minimum amount of 50 Units, unless a Limited Partner is
redeeming his entire interest in a Partnership.
<PAGE>
Morgan Stanley Dean Witter Spectrum Series
Notes to Financial Statements
(Continued)
Exchanges - On the last day of the first month which occurs
more than six months after a person first becomes a Limited
Partner in any of the Partnerships, and at the end of each
month thereafter, Limited Partners may exchange their
investment among the Partnerships (subject to certain
restrictions outlined in the Limited Partnership Agreements)
without paying additional charges.
Dissolution of the Partnership - Spectrum Commodity will
terminate on December 31, 2027, Spectrum Global Balanced,
Spectrum Strategic and Spectrum Technical will terminate on
December 31, 2035 and Spectrum Select will terminate on
December 31, 2025 regardless of financial condition at such
time, or at an earlier date under certain conditions as defined
in each Partnership's Limited Partnership Agreement.
2. Related Party Transactions
Spectrum Commodity pays brokerage fees to the Commodity Brokers
and a service fee to Demeter, Spectrum Global Balanced,
Spectrum Select, Spectrum Strategic and Spectrum Technical each
pay brokerage fees to DWR, as described in Note 1. For
Spectrum Commodity its cash is on deposit with MS & Co. and
MSIL or Spectrum Global Balanced, Spectrum Select, Spectrum
Strategic and Spectrum Technical their cash is on deposit with
DWR and Carr in futures interests trading accounts to meet
margin requirements as needed. DWR and MS & Co. pay interest
on these funds as described in Note 1.
3. Trading Advisors
Demeter, on behalf of each Partnership, retains certain
commodity trading advisors to make all trading decisions for
the Partnerships. The trading advisors for each Partnership
are as follows:
Morgan Stanley Dean Witter Spectrum Commodity L.P.
Morgan Stanley Dean Witter Commodities Management, Inc.
Morgan Stanley Dean Witter Spectrum Global Balanced L.P.
RXR, Inc.
Morgan Stanley Dean Witter Spectrum Select L.P.
EMC Capital Management, Inc.
Rabar Market Research, Inc.
Sunrise Capital Management, Inc.
Morgan Stanley Dean Witter Spectrum Strategic L.P.
Allied Irish Capital Management, Ltd. ("AICM")
Blenheim Investments, Inc. ("Blenheim")
Willowbridge Associates Inc. ("Willowbridge")
Morgan Stanley Dean Witter Spectrum Technical L.P.
Campbell & Company, Inc.) ("Campbell")
Chesapeake Capital Corporation ("Chesapeake")
John W. Henry & Company, Inc. ("JWH")
Compensation to the trading advisors by the Partnerships
consists of management fee and an incentive fee as follows:
<PAGE>
Morgan Stanley Dean Witter Spectrum Series
Notes to Financial Statements
(Concluded)
Management Fee - The management fee for Spectrum Commodity is
accrued at a rate of 5/24 of 1% of Net Assets on the first day
of each month (a 2.5% annual rate).
The management fee for Spectrum Global Balanced is accrued at a
rate of 5/48 of 1% of Net Assets on the first day of each month
(a 1.25% annual rate).
The management fee for Spectrum Select is accrued at a rate of
1/4 of 1% of Net Assets on the first day of each month (a 3%
annual rate).
The management fee for Spectrum Strategic is accrued at a rate
of 1/12 of 4% of Net Assets allocated to each of Blenheim and
Willowbridge on the first day of each month, and 1/12 of 3% of
Net Assets allocated to AICM on the first day of each month
(annual rates of 4% and 3%, respectively).
The management fee for Spectrum Technical is accrued at a rate
of 1/3 of 1% of Net Assets on the first day of each month (a 4%
annual rate).
Incentive Fee - Spectrum Commodity pays an annual incentive fee
equal to 20% of the trading profits as of the end of each
calendar year.
Spectrum Global Balanced, Spectrum Select and Spectrum
Strategic each pay a monthly incentive fee equal to 15% of the
trading profits experienced with respect to each trading
advisor's allocated Net Assets as of the end of each calendar
month.
Spectrum Technical pays a monthly incentive fee equal to 15% of
the trading profits experienced with respect to the Net Assets
allocated to Campbell and JWH and 19% of the trading profits
experienced with respect to the Net Assets allocated to
Chesapeake as of the end of each calendar month.
Trading profits for the Partnership's represent the amount by
which profits from futures, forward and options trading exceed
losses after brokerage and management fees are deducted.
For all Partnerships, when trading losses are incurred, no
incentive fees will be paid in subsequent months until all such
losses are received. Cumulative trading losses are adjusted on
a pro-rata basis for the net amount of each months
subscriptions and redemptions.