Morgan Stanley Dean Witter Spectrum Series
Monthly Report
June 2000
Dear Limited Partner:
The Net Asset Value per Unit for each of the five Morgan Stanley Dean
Witter Spectrum Funds as of June 30, 2000 was as follows:
Funds N.A.V. % change for month
Spectrum Commodity $ 7.67 -0.86%
Spectrum Global Balanced $15.61 -0.29%
Spectrum Select $20.25 -4.40%
Spectrum Strategic $11.32 -7.80%
Spectrum Technical $13.64 -2.77%
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 Strategic, a fund managed by multiple trading advisors
who employ fundamental trading methodologies, experienced difficulty across
a broad number of markets, particularly in the soft commodities and energy
markets. Spectrum Select, a technically-based multi-manager fund, recorded
losses primarily in the currency markets, particularly from short Canadian
dollar positions. Spectrum Technical, the other technically-based multi-
manager fund, recorded losses primarily in the currency markets,
particularly from short positions in the Japanese yen and Australian
dollar. Spectrum Commodity, a fund that participates in the tangible
commodity markets from the long side, incurred small losses primarily in
the agricultural markets. Spectrum Global Balanced, a balanced portfolio
of stocks, bonds and managed futures, experienced small losses primarily in
the currency markets, particularly from short positions in the New Zealand
dollar.
Spectrum Commodity
The Fund decreased in value during June due primarily to losses recorded in
the agricultural markets from long corn futures positions as prices fell
due to heavy rain and cooler temperatures in the major corn producing
regions. Additional losses were recorded from long positions in soybean
oil futures as prices declined later in the month on forecasts for rains
and moderate temperatures. In soft commodities, losses were experienced
from long cotton futures positions as prices moved lower, pressured
downward by heavy deliveries in July, benign weather forecasts for the U.S.
cotton belt and expectations that crop size is edging higher. A portion of
these losses was offset by gains recorded in the energy markets from long
futures positions in crude oil and its related products as the previous
upward movement in oil prices reemerged amid rising concerns regarding
supplies and production levels. In the metals markets, gains were recorded
from long aluminum futures positions as prices reversed sharply higher at
mid-month on institutional buying and fears that U.S. capacity could be hit
further by power shortages. Additional gains were produced from long gold
futures positions as gold prices increased in reaction to the U.S. dollar's
weakness and the Federal Open Market Committee's decision to leave interest
rates unchanged.
Spectrum Global Balanced
The Fund experienced a small decrease in value during June due primarily to
losses recorded in the currency markets, specifically from short positions
in the New Zealand dollar as the value of the U.S. dollar weakened relative
to other currencies due to the perception that U.S. interest rates may have
topped in the near-term. In the global interest rate futures markets,
losses were experienced from short eurodollar futures positions as prices
moved higher amid signs that U.S. economic growth has slowed and the
prospects of additional interest rate hikes by the Federal Reserve are
fading. In the global stock index futures markets, small losses were
recorded from long positions in European stock index futures, particularly
in British and German stock indices, as prices decreased after the European
Central Bank's aggressive interest rate hike in early June. A majority of
these losses was offset by gains recorded in the energy markets from long
futures positions in crude oil and its related products as the previous
upward movement in oil prices reemerged amid rising concerns regarding
supplies and production levels. In the agricultural markets, gains were
recorded from short corn futures positions as prices fell due to heavy rain
and cooler temperatures in the major corn producing regions.
<PAGE>
Spectrum Select
The Fund decreased in value during June due primarily to losses recorded
early in the month in the currency markets from short Canadian dollar
positions as its value strengthened versus the U.S. dollar on Canada's
stronger-than-expected quarterly GDP data and overall weakness in the U.S.
currency. In the metals markets, losses were recorded from short gold
futures positions as gold prices increased in reaction to the U.S. dollar's
weakness and the Federal Open Market Committee's decision to leave interest
rates unchanged. Additional losses were experienced from short aluminum
futures positions as prices reversed sharply higher at mid-month on
institutional buying and fears that U.S. capacity could be hit further by
power shortages. In the global interest rate futures markets, losses were
incurred from short eurodollar futures positions as prices moved higher
amid signs that U.S. economic growth has slowed and the prospects of
additional interest rate hikes by the Federal Reserve are fading. Smaller
losses were recorded in the global stock index futures markets from short
positions in Nikkei 225 Index futures positions as Japanese equity prices
moved higher amid strength in technology issues. A portion of these losses
was offset by gains recorded in the energy markets from long futures
positions in crude oil and its related products as the previous upward
movement in oil prices reemerged amid rising concerns regarding supplies
and production levels. In the soft commodities markets, gains were
recorded from long positions in sugar futures as sugar prices trended to 22-
month highs due to strong demand and declining production from Brazil.
Spectrum Strategic
The Fund decreased in value during June due primarily to losses recorded in
the soft commodities markets from long cotton futures positions as prices
moved lower, pressured downward by heavy deliveries in July, benign weather
forecasts for the U.S. cotton belt and expectations that crop size is
edging higher. In the energy markets, losses were recorded from short
futures positions in crude oil as the previous upward movement in oil
prices reemerged amid rising concerns regarding supplies and production
levels. In the metals markets, losses were recorded during the first week
of June from long positions in aluminum, copper and zinc futures as most
base metals prices declined on technically based factors. In the
agricultural markets, losses were experienced from long soybean futures
positions as prices moved lower due to rain in the Midwest. Smaller losses
were incurred in the global interest rate and stock index futures markets.
In the currency markets, losses incurred from short positions in the
Japanese yen, as the value of the U.S. dollar weakened due to the
perception that U.S. interest rates may have topped in the near-term, were
offset by gains recorded from long positions in the euro and Swiss franc as
their values strengthened versus the U.S. dollar.
Spectrum Technical
The Fund decreased in value during June due primarily to losses recorded in
the currency markets from short positions in the Japanese yen and
Australian dollar as the value of the U.S. dollar weakened relative to
these currencies due to the perception that U.S. interest rates may have
topped in the near-term. Data suggesting that economic growth in the U.S.
may finally be slowing also pressured the U.S. dollar lower. In the global
interest rate futures markets, losses were incurred from short eurodollar
and German bund futures positions as prices moved higher amid signs that
U.S. economic growth has slowed and the prospects of additional interest
rate hikes by the Federal Reserve are fading. In the metals markets,
losses were recorded from short gold futures positions as gold prices
increased in reaction to the U.S. dollar's weakness and the Federal Open
Market Committee's decision to leave interest rates unchanged. In the
global stock index futures markets, small losses were recorded from short
positions in Nikkei 225 Index futures positions as Japanese equity prices
moved higher amid strength in technology issues. A portion of these losses
was offset by gains recorded in the energy markets from long futures
positions in crude oil and its related products as the previous upward
movement in oil prices reemerged amid rising concerns regarding supplies
and production levels. In the soft commodities markets, gains were
recorded from long positions in sugar futures as sugar prices trended to 22-
month highs due to strong demand and declining production from Brazil.
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.
<PAGE>
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 (6 months) 0.8%
Inception-to-Date Return: -22.6%
Annualized Return: -10.1%
___________________________________________________________________________
__________
Spectrum Global Balanced
1994 (2 months) -1.7%
1995 22.8%
1996 -3.6%
1997 18.2%
1999 16.4%
1999 0.8%
2000 (6 months) -3.2%
Inception-to-Date Return: 56.1%
Annualized Return: 8.2%
___________________________________________________________________________
__________
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 (6 months) -8.0%
Inception-to-Date Return: 102.5%
Annualized Return 8.2%
___________________________________________________________________________
__________
Spectrum Strategic
1994 (2 months) 0.1%
1995 10.5%
1996 -3.5%
1997 0.4%
1998 7.8%
1999
37.2%
2000 (6 months) -28.6%
Inception-to-Date Return: 13.2%
Annualized Return: 2.2%
___________________________________________________________________________
__________
</TABLE>
<PAGE>
<TABLE>
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 (6 months) -8.5%
Inception-to-Date Return: 36.4%
Annualized Return: 5.6%
</TABLE>
<PAGE>
<TABLE>
Morgan Stanley Dean Witter Spectrum Series
Statements of Operations
For the Month Ended June 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
June 1, 2000 June 1, 2000
June 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 199,934 0.91 (483,343) (0.87)
585,295 0.29
Net change in unrealized (344,980) (1.57) 323,881 0.58
(8,574,001) (4.21)
Total Trading Results (145,046) (0.66) (159,462) (0.29)
(7,988,706) (3.92)
Interest Income (DWR) 85,599 0.39 269,869 0.49
775,245 0.38
Total Revenues (59,447) (0.27) 110,407 0.20
(7,213,461) (3.54)
EXPENSES
Brokerage fees (DWR) 83,982 0.38 212,615 0.38
1,230,552 0.61
Management fees 45,642 0.21 57,776
0.11 509,194 0.25
Total Expenses 129,624 0.59 270,391 0.49
1,739,746 0.86
NET LOSS (189,071) (0.86) (159,984) (0.29)
(8,953,207) (4.40)
Morgan Stanley Dean Witter Spectrum Series
Statements of Changes in Net Asset Value
For the Month Ended June 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,
May 1, 2000 2,833,239.669 21,931,472 7.74 3,543,332.557
55,465,384 15.65 9,614,936.049 203,700,401 21.19
Net Loss - (189,071) (0.07) -
(159,984) (0.04) - (8,953,207) (0.94)
Redemptions (30,105.168) (230,907) 7.67 (42,659.866)
(665,921) 15.61 (154,985.629) (3,138,459) 20.25
Subscriptions 33,581.769 257,364 7.67 35,996.540
561,906 15.61 106,221.846 2,149,972 20.25
Net Asset Value,
June 30, 2000 2,836,716.270 21,768,858 7.67 3,536,469.231
55,201,385 15.61 9,566,172.266 193,758,707 20.25
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 June 30, 2000
(Unaudited)
<CAPTION>
Morgan Stanley Dean Witter Morgan Stanley
Dean Witter
Spectrum Strategic
Spectrum Technical .
Percent of Percent of
June 1, 2000 June 1, 2000
Amount Net Asset Value Amount
Net Asset Value
$ % $
%
REVENUES
<S> <C> <C>
<C> <C>
Trading profit (loss):
Realized (4,691,187) (5.33) 13,132,497
5.28
Net change in unrealized (1,844,251) (2.10) (18,629,985)
(7.49)
Total Trading Results (6,535,438) (7.43) (3,497,488)
(2.21)
Interest Income (DWR) 338,224 0.38 941,517
0.38
Total Revenues (6,197,214) (7.05) (5,555,971)
(1.83)
EXPENSES
Brokerage fees (DWR) 440,215 0.50 1,502,336
0.61
Management fees 219,734 0.25 828,875
0.33
Total Expenses 659,949 0.75 2,331,211
0.94
NET LOSS (6,857,163) (7.80) (6,887,182) (2.77)
Morgan Stanley Dean Witter Spectrum Series
Statements of Changes in Net Asset Value
For the Month Ended June 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,
June 1, 2000 7,154,339.389 87,857,618 12.28 17,724397.202
248,662,524 14.03
Net Loss - (6,857,163) (0.96) -
(6,887,182) (0.39)
Redemptions (98,600.744) (1,116.160) 11.32 (293,977.094)
(4,009,848) 13.64
Subscriptions 133,316.275 1,509,140 11.32 192,652.412
2,627,779 13.64
Net Asset Value,
June 30, 2000 7,189,074,920 81,393,435 11.32 17,623,072.520
240,393,273 13.64
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 - The
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 MS & Co. and MSIL 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. Spectrum
Commodity's cash is on deposit with MS & Co. and MSIL and
Spectrum Global Balanced's, Spectrum Select's, Spectrum
Strategic's and Spectrum Technical's 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")
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 a 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 Blenheim 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.
