<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 1996
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 number: 0-21368
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
- - --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 13-3631113
- - --------------------------------------------------------------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
One New York Plaza, 13th Floor, New York, New York 10292
- - --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 778-7866
N/A
- - --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by check CK 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 _CK_ No __
<PAGE>
Part I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
<TABLE>
<CAPTION>
March 31, 1996
--------------------------------------
Class A Class B
Units Units Total
<S> <C> <C> <C>
- - ---------------------------------------------------------------------------------------------------
ASSETS
Equity in commodity trading accounts:
Cash $1,048,555 $162,308 $1,210,863
U.S. Treasury bills, at amortized cost 3,265,368 614,129 3,879,497
Net unrealized gain on open commodity positions 158,961 28,052 187,013
---------- -------- ----------
Net equity 4,472,884 804,489 5,277,373
Reserve assets, at amortized cost 3,712,492 -- 3,712,492
Unrealized gain on reserve assets 21,923 -- 21,923
Organizational costs, net 13,589 1,374 14,963
---------- -------- ----------
Total assets $8,220,888 $805,863 $9,026,751
---------- -------- ----------
---------- -------- ----------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable $ 253,600 $ 16,058 $ 269,658
Accrued expenses 75,121 14,898 90,019
Management fees payable 8,732 1,571 10,303
Other transaction fees payable 1,573 278 1,851
---------- -------- ----------
Total liabilities 339,026 32,805 371,831
---------- -------- ----------
Commitments
Partners' capital
Limited partners (72,361 Class A Units and 7,136 Class B
Units outstanding) 7,803,039 765,229 8,568,268
General partner (731 Class A Units and 73
Class B Units outstanding) 78,823 7,829 86,652
---------- -------- ----------
Total partners' capital 7,881,862 773,058 8,654,920
---------- -------- ----------
Total liabilities and partners' capital $8,220,888 $805,863 $9,026,751
---------- -------- ----------
---------- -------- ----------
Net asset value per limited and general partnership units
(the ``Class A Units'' and the ``Class B Units'' and
collectively, the ``Units'') $ 107.83 $ 107.24 $ 107.78
---------- -------- ----------
---------- -------- ----------
- - ---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
2
<PAGE>
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
<TABLE>
<CAPTION>
December 31, 1995
--------------------------------------
Class A Class B
Units Units Total
<S> <C> <C> <C>
- - ----------------------------------------------------------------------------------------------------
ASSETS
Equity in commodity trading accounts:
Cash $1,074,975 $ 199,027 $1,274,002
U.S. Treasury bills, at amortized cost 3,585,504 650,867 4,236,371
Net unrealized gain on open commodity positions 324,337 57,236 381,573
---------- ---------- ----------
Net equity 4,984,816 907,130 5,891,946
Reserve assets, at amortized cost 3,690,527 -- 3,690,527
Unrealized gain on reserve asset 52,586 -- 52,586
Organizational costs, net 18,716 1,869 20,585
---------- ---------- ----------
Total assets $8,746,645 $ 908,999 $9,655,644
---------- ---------- ----------
---------- ---------- ----------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable $ 77,638 $ 19,590 $ 97,228
Accrued expenses 87,527 17,071 104,598
Management fees payable 9,767 1,776 11,543
Other transaction fees payable 1,655 292 1,947
---------- ---------- ----------
Total liabilities 176,587 38,729 215,316
---------- ---------- ----------
Commitments
Partners' capital
Limited partners (73,911 Class A Units
and 7,136 Class B Units outstanding) 8,395,470 843,899 9,239,369
General partner (1,537 Class A Units
and 223 Class B Units outstanding) 174,588 26,371 200,959
---------- ---------- ----------
Total partners' capital 8,570,058 870,270 9,440,328
---------- ---------- ----------
Total liabilities and partners' capital $8,746,645 $ 908,999 $9,655,644
---------- ---------- ----------
---------- ---------- ----------
Net asset value per limited and general partnership unit
(the ``Class A Units'' and the ``Class B Units'' and
collectively, the ``Units'') $ 113.59 $ 118.26 $ 114.00
---------- ---------- ----------
---------- ---------- ----------
- - ----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
3
<PAGE>
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Class A Units
----------------------------------
<S> <C> <C>
Three months ended March 31,
----------------------------------
1996 1995
- - -----------------------------------------------------------------------------------------------------
REVENUES
Net realized gain (loss) on commodity transactions $ (147,774) $ 5,795
Change in net unrealized gain on open commodity positions (165,376) 340,337
Change in unrealized gain/loss on reserve assets (30,662) 84,328
Interest from U.S. Treasury bills 44,864 46,134
Interest from reserve assets 55,490 55,951
Realized gain on reserve assets 475 --
------------------ -------------
(242,983) 532,545
------------------ -------------
EXPENSES
Commissions 94,817 88,653
Other transaction fees 11,023 7,515
Management fees 27,397 22,567
General and administrative 32,030 32,346
Letter of credit fees 21,219 23,109
Amortization of organizational costs 4,679 5,093
------------------ -------------
191,165 179,283
------------------ -------------
Net income (loss) $ (434,148) $ 353,262
------------------ -------------
------------------ -------------
ALLOCATION OF NET INCOME (LOSS)
Limited partners $ (425,294) $ 346,653
------------------ -------------
------------------ -------------
General partner $ (8,854) $ 6,609
------------------ -------------
------------------ -------------
NET INCOME (LOSS) PER WEIGHTED AVERAGE LIMITED
AND GENERAL PARTNERSHIP CLASS A UNIT
Net income (loss) per weighted average limited and
general partnership Class A unit $ (5.75) $ 4.30
------------------ -------------
------------------ -------------
Weighted average number of limited and general
partnership Class A units outstanding 75,448 82,166
------------------ -------------
------------------ -------------
- - -----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
4
<PAGE>
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Class B Units
--------------------------------
<S> <C> <C>
Three months ended March 31,
--------------------------------
1996 1995
- - ---------------------------------------------------------------------------------------------------
REVENUES
Net realized gain (loss) on commodity transactions $ (26,079) $ 1,129
Change in net unrealized gain on open commodity positions (29,184) 64,824
Interest from U.S. Treasury bills 8,262 8,772
------------------ -----------
(47,001) 74,725
------------------ -----------
EXPENSES
Commissions 17,023 16,803
Other transaction fees 1,946 1,432
Management fees 4,922 4,284
General and administrative 9,767 6,154
Amortization of organizational costs 467 548
------------------ -----------
34,125 29,221
------------------ -----------
Net income (loss) $ (81,126) $ 45,504
------------------ -----------
------------------ -----------
ALLOCATION OF NET INCOME (LOSS)
Limited partners $ (78,670) $ 44,327
------------------ -----------
------------------ -----------
General partner $ (2,456) $ 1,177
------------------ -----------
------------------ -----------
NET INCOME (LOSS) PER WEIGHTED AVERAGE LIMITED
AND GENERAL PARTNERSHIP CLASS B UNIT
Net income (loss) per weighted average limited and
general partnership Class B unit $ (11.02) $ 5.28
------------------ -----------
------------------ -----------
Weighted average number of limited and general
partnership Class B units outstanding 7,359 8,623.153
------------------ -----------
------------------ -----------
- - ---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
5
<PAGE>
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Total Units
--------------------------------
<S> <C> <C>
Three months ended March 31,
--------------------------------
1996 1995
- - ---------------------------------------------------------------------------------------------------
REVENUES
Net realized gain (loss) on commodity transactions $ (173,853) $ 6,924
Change in net unrealized gain on open commodity positions (194,560) 405,161
Change in unrealized gain/loss on reserve assets (30,662) 84,328
Interest from U.S. Treasury bills 53,126 54,906
Interest from reserve assets 55,490 55,951
Realized gain on reserve assets 475 --
------------------ -----------
(289,984) 607,270
------------------ -----------
EXPENSES
Commissions 111,840 105,456
Other transaction fees 12,969 8,947
Management fees 32,319 26,851
General and administrative 41,797 38,500
Letter of credit fees 21,219 23,109
Amortization of organizational costs 5,146 5,641
------------------ -----------
225,290 208,504
------------------ -----------
Net income (loss) $ (515,274) $ 398,766
------------------ -----------
------------------ -----------
ALLOCATION OF NET INCOME (LOSS)
Limited partners $ (503,964) $ 390,980
------------------ -----------
------------------ -----------
General partner $ (11,310) $ 7,786
------------------ -----------
------------------ -----------
NET INCOME (LOSS) PER WEIGHTED AVERAGE LIMITED
AND GENERAL PARTNERSHIP UNIT
Net income (loss) per weighted average limited and
general partnership unit $ (6.22) $ 4.39
------------------ -----------
------------------ -----------
Weighted average number of limited and general
partnership units outstanding 82,807 90,789.153
------------------ -----------
------------------ -----------
- - ---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
6
<PAGE>
PRUENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
(Unaudited)
<TABLE>
<CAPTION>
CLASS A LIMITED GENERAL
UNITS PARTNERS PARTNER TOTAL
<S> <C> <C> <C> <C>
- - -----------------------------------------------------------------------------------------------------
Partners' capital--December 31, 1995 75,448 $8,395,470 $174,588 $8,570,058
Net loss -- (425,294) (8,854) (434,148)
Redemptions (2,356 ) (167,137) (86,911) (254,048)
------- ---------- -------- ----------
Partners' capital--March 31, 1996 73,092 $7,803,039 $ 78,823 $7,881,862
------- ---------- -------- ----------
------- ---------- -------- ----------
<CAPTION>
CLASS B LIMITED GENERAL
UNITS PARTNERS PARTNER TOTAL
<S> <C> <C> <C> <C>
- - -----------------------------------------------------------------------------------------------------
Partners' capital--December 31, 1995 7,359 $ 843,899 $ 26,371 $ 870,270
Net loss -- (78,670) (2,456) (81,126)
Redemptions (150 ) -- (16,086) (16,086)
------- ---------- -------- ----------
Partners' capital--March 31, 1996 7,209 $ 765,229 $ 7,829 $ 773,058
------- ---------- -------- ----------
------- ---------- -------- ----------
<CAPTION>
TOTAL LIMITED GENERAL
UNITS PARTNERS PARTNER TOTAL
<S> <C> <C> <C> <C>
- - -----------------------------------------------------------------------------------------------------
Partners' capital--December 31, 1995 82,807 $9,239,369 $200,959 $9,440,328
Net loss -- (503,964) (11,310) (515,274)
Redemptions (2,506 ) (167,137) (102,997) (270,134)
------- ---------- -------- ----------
Partners' capital--March 31, 1996 80,301 $8,568,268 $ 86,652 $8,654,920
------- ---------- -------- ----------
------- ---------- -------- ----------
- - -----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
7
<PAGE>
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 1996
(Unaudited)
A. General
These financial statements have been prepared without audit. In the opinion
of management, the financial statements contain all adjustments (consisting of
only normal recurring adjustments) necessary to present fairly the financial
position of Prudential Securities OptiMax Futures Fund 2, L.P. (the
``Partnership'') as of March 31, 1996 and the results of its operations for the
three months ended March 31, 1996 and 1995. However, the operating results for
the interim periods may not be indicative of the results expected for a full
year.
Certain information and footnote disclosures normally included in annual
financial statements prepared in accordance with generally accepted accounting
principles have been omitted. It is suggested that these financial statements be
read in conjunction with the financial statements and notes thereto included in
the Partnership's Annual Report on Form 10-K filed with the Securities and
Exchange Commission for the year ended December 31, 1995 (the ``Annual
Report'').
Certain balances for prior periods have been reclassified to conform with the
current financial statement presentation.
Limited partners own Class A Units and/or Class B Units and, accordingly,
separate financial statements are presented for Class A Units and Class B Units.
In accordance with the Partnership Agreement, combined financial statements for
the Partnership are presented in the ``Total'' columns.
Trading gains and losses (other than those expenses which are particular to
Class A Units) are allocated between the Class A Units and Class B Units based
on the pro rata portion of the Partnership's traded assets allocated to each
Class. The allocation is adjusted quarterly to take into account the effect of
redemptions. The quarterly allocation between the Class A Units and Class B
Units during the periods ended March 31, 1996 and 1995 was as follows:
<TABLE>
<CAPTION>
1996 1995
------------------- -------------------
<S> <C> <C> <C> <C>
CLASS A CLASS B CLASS A CLASS B
Quarter Ended UNITS UNITS UNITS UNITS
- - ------------------- -------- -------- -------- --------
March 31 85% 15% 84% 16%
</TABLE>
An irrevocable letter of credit (``Letter of Credit'') was issued in favor of
the Partnership by Citibank, N.A. on January 6, 1992. The Letter of Credit is
intended to provide protection to the Class A limited partners against loss of
their initial investment as of March 31, 1997 (the ``Capital Return Date'') when
the limited partners will have the option to redeem their Class A Units and
receive the greater of the then current net asset value per Class A Unit or 100%
of their initial investment. When the Letter of Credit expires on the Capital
Return Date, reserve assets will become available for commodities trading.
8
<PAGE>
B. Related Parties
Seaport Futures Management, Inc. (the ``General Partner'') and its affiliates
perform services for the Partnership which include, but are not limited to:
brokerage and letter of credit services; accounting and financial management;
registrar, transfer and assignment functions; investor communications; printing
services and other administrative services. The costs incurred for these
services for the three months ended March 31, 1996 were:
<TABLE>
<CAPTION>
CLASS A CLASS B
UNITS UNITS TOTAL
<S> <C> <C> <C>
- - -----------------------------------------------------------------------------------------
Commissions and Letter of Credit fees $ 99,532 $17,023 $116,555
General and administrative 17,034 3,006 20,040
-------- ------- --------
$116,566 $20,029 $136,595
-------- ------- --------
-------- ------- --------
</TABLE>
The costs incurred for these services for the three months ended March 31,
1995 were:
<TABLE>
<CAPTION>
CLASS A CLASS B
UNITS UNITS TOTAL
<S> <C> <C> <C>
- - -----------------------------------------------------------------------------------------
Commissions and Letter of Credit fees $ 93,786 $16,803 $110,589
General and administrative 14,006 2,666 16,672
-------- ------- --------
$107,792 $19,469 $127,261
-------- ------- --------
-------- ------- --------
</TABLE>
Expenses payable to the General Partner and its affiliates (which are
included in accrued expenses) as of March 31, 1996 and December 31, 1995 were
$32,211 and $34,196 for Class A Units, respectively, and $6,515 and $6,865 for
Class B Units, respectively.
The Partnership maintains its trading and cash accounts at Prudential
Securities Incorporated (``PSI''), the Partnership's commodity broker and an
affiliate of the General Partner. Approximately 75% of the Partnership's trading
assets are invested in interest-bearing U.S. Treasury obligations (primarily
U.S. Treasury bills), a significant portion of which is utilized for margin
purposes for the Partnership's commodity trading activities. As described in the
Annual Report, all commissions for brokerage services are paid to PSI.
When the Partnership engages in forward foreign currency transactions, it
trades with PSI who simultaneously engages in back-to-back transactions with an
affiliate who, pursuant to the Partnership's prospectus, is obligated to charge
a competitive price.
Additionally, as of March 31, 1996 and December 31, 1995, the Partnership's
reserve assets consist solely of a 6.29% guaranteed investment contract
(``GIC'') which matures on March 31, 1997 with The Prudential Asset Management
Company, Inc., an affiliate of the General Partner.
C. Credit and Market Risk
The quantitative disclosures presented below are for Total Units. Allocation
of these amounts to the Class A Units and Class B Units can be made in
conjunction with the quarterly allocation percentages as more fully discussed in
Note A.
Since the Partnership's business is to trade futures, forward and options
contracts, its capital is at risk due to changes in the value of these contracts
(market risk) or the inability of counterparties to perform under the terms of
the contracts (credit risk).
Futures, forward and options contracts involve varying degrees of off-balance
sheet risk; and changes in the level of volatility of interest rates, foreign
currency exchange rates or the market values of the contracts (or commodities
underlying the contracts) frequently result in changes in the Partnership's
unrealized gain (loss) on open commodity positions reflected in the statements
of financial condition. The Partnership's exposure to market risk is influenced
by a number of factors including the relationships among the contracts held by
the Partnership as well as the liquidity of the markets in which the contracts
are traded.
9
<PAGE>
Futures and options contracts are traded on organized exchanges and are thus
distinguished from forward contracts which are entered into privately by the
parties. The credit risks associated with futures and options contracts are
typically perceived to be less than those associated with forward contracts,
because exchanges typically provide clearinghouse arrangements in which the
collective credit (subject to certain limitations) of the members of the
exchanges is pledged to support the financial integrity of the exchange. On the
other hand, the Partnership must rely solely on the credit of its broker (PSI)
with respect to forward transactions. To the extent that the Partnership engages
in forward transactions, it will present its unrealized gains and losses on open
forward positions as a net amount in its statements of financial condition
because it has a master netting agreement with PSI.
The General Partner attempts to minimize both credit and market risks by
requiring the Partnership's trading managers to abide by various trading
limitations and policies. The General Partner monitors compliance with these
trading limitations and policies which include, but are not limited to,
executing and clearing all trades with creditworthy counterparties (currently
PSI is the sole counterparty or broker); limiting the amount of margin or
premium required for any one commodity or all commodities combined; and
generally limiting transactions to contracts which are traded in sufficient
volume to permit the taking and liquidating of positions. The General Partner
may impose additional restrictions (through modifications of such trading
limitations and policies) upon the trading activities of the trading managers as
it, in good faith, deems to be in the best interests of the Partnership.
PSI, when acting as the Partnership's futures commission merchant in
accepting orders for the purchase or sale of domestic futures and options
contracts, is required by Commodity Futures Trading Commission (``CFTC'')
regulations to separately account for and segregate as belonging to the
Partnership all assets of the Partnership relating to domestic futures and
options trading and is not to commingle such assets with other assets of PSI. At
March 31, 1996 and December 31, 1995, such segregated assets totalled $5,164,378
and $5,663,909, respectively. Part 30.7 of the CFTC regulations also requires
PSI to secure assets of the Partnership related to foreign futures and options
trading which totalled $112,995 and $228,037 at March 31, 1996 and December 31,
1995, respectively. There are no segregation requirements for assets related to
forward trading.
As of March 31, 1996, the Partnership's open futures contracts mature within
six months. As of December 31, 1995, the Partnership's open futures contracts
mature within nine months.
At March 31, 1996 and 1995, gross contract amounts of open futures contracts
are:
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
------------ ------------
<S> <C> <C>
Financial Futures Contracts:
Commitments to purchase $ 7,919,086 $57,176,332
Commitments to sell 29,111,660 26,500,440
Currency Futures Contracts:
Commitments to purchase -- 520,875
Commitments to sell 3,887,438 1,244,675
Commodity Futures Contracts:
Commitments to purchase 4,985,295 2,159,874
</TABLE>
The gross contract amounts represent the Partnership's potential involvement
in a particular class of financial instrument (if it were to take or make
delivery on an underlying futures contract). The gross contract amounts
significantly exceed the future cash requirements as the Partnership intends to
close out open positions prior to settlement and thus is generally subject only
to the risk of loss arising from the change in the value of the contracts. As
such, the Partnership considers the ``fair value'' of its futures, forward and
options contracts to be the net unrealized gain or loss on the contracts (plus
premiums on options). Thus, the amount at risk associated with counterparty
nonperformance of all contracts is the net unrealized gain included in the
statements of financial condition. The market risk associated with the
Partnership's commitments to sell is unlimited since the Partnership's potential
involvement is to make delivery of an underlying commodity at the contract
price; therefore, it must repurchase the contract at prevailing market prices.
10
<PAGE>
At March 31, 1996 and December 31, 1995, the fair value of futures contracts
were:
<TABLE>
<CAPTION>
March 31, 1996 December 31, 1995
-------------------------------- ------------------------
<S> <C> <C> <C> <C>
Fair Value Fair Value
-------------------------------- ------------------------
Assets Liabilities Assets Liabilities
-------------- -------------- -------- ------------
Futures Contracts:
Domestic exchanges
Commodities $ 96,394 $ 58,783 $131,838 $ 5,720
Financial 66,281 -- 34,875 --
Currencies 33,288 -- 26,275 --
Foreign exchanges
Financial 60,256 10,423 196,148 1,843
-------------- -------------- -------- ------------
$256,219 $ 69,206 $389,136 $ 7,563
-------------- -------------- -------- ------------
-------------- -------------- -------- ------------
</TABLE>
The following table represents the average fair value of futures and forward
contracts during the three months ended March 31, 1996 and 1995, respectively.
<TABLE>
<CAPTION>
Three months ended Three months ended
March 31, 1996 March 31, 1995
------------------------ ------------------------
Average Fair Value Average Fair Value
------------------------ ------------------------
Assets Liabilities Assets Liabilities
-------- ----------- -------- -----------
<S> <C> <C> <C> <C>
Futures Contracts:
Domestic exchanges
Commodities $104,944 $38,219 $ 16,059 $ 7,699
Financial 37,405 3,428 18,134 2,930
Currencies 48,841 2,803 39,768 28,776
Foreign exchanges
Commodities -- -- 4,992 18,539
Financial 107,663 9,537 158,063 20,400
Forward Contracts:
Commodities -- -- 5,163 2,175
-------- ----------- -------- -----------
$298,853 $53,987 $242,179 $80,519
-------- ----------- -------- -----------
-------- ----------- -------- -----------
</TABLE>
11
<PAGE>
The following table represents the net realized gains (losses) and the change
in unrealized gains/losses of futures and forward contracts during the three
months ended March 31, 1996 and 1995, respectively.
<TABLE>
<CAPTION>
Three months ended March 31, 1996 Three months ended March 31, 1995
------------------------------------------- ---------------------------------------------
Net Realized Change in Net Realized Change in
Gains Unrealized Gains Unrealized
(Losses) Gains/Losses Total (Losses) Gains/Losses Total
------------ ------------ --------- ------------ ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Futures Contracts:
Domestic exchanges
Commodities $ 42,306 $ (88,506) $ (46,200) $ (15,973) $ 18,169 $ 2,196
Financial (101,588) 31,406 (70,182) 50,510 (8,156) 42,354
Currencies (45,920) 7,013 (38,907) 153,578 114,015 267,593
Foreign exchanges
Commodities -- -- -- 9,845 (53,417) (43,572)
Financial (68,651) (144,473) (213,124) (191,036) 346,500 155,464
Forward Contracts:
Commodities -- -- -- -- (11,950) (11,950)
------------ ------------ --------- ------------ ------------ -----------
$ (173,853) $ (194,560) $(368,413) $ 6,924 $405,161 $ 412,085
------------ ------------ --------- ------------ ------------ -----------
------------ ------------ --------- ------------ ------------ -----------
</TABLE>
D. Subsequent Event
As of April 1, 1996, the outstanding Letter of Credit amount was reduced by
$235,600 or $100 for each Class A Unit redeemed for the quarter ended March 31,
1996.
12
<PAGE>
PRUDENTIAL SECURITIES OPTIMAX FUTURES FUND 2, L.P.
(a limited partnership)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Partnership commenced operations on January 7, 1992 with gross proceeds
of $17,587,600. After accounting for offering and organizational expenses, the
Partnership's net proceeds were approximately $14,967,200 for Class A Units and
$2,180,700 for Class B Units. At the inception of the Partnership, sixty percent
(60%) of the initial net proceeds of the Class A Units (``Class A Traded
Assets'') and 100% of the initial net proceeds of the Class B Units (``Class B
Traded Assets'') were allocated to trading activity. The remaining forty percent
(40%) of the initial net proceeds of the Class A Units was placed in reserve and
invested in investment grade interest-bearing obligations (``Reserve Assets'').
The Reserve Assets remain available to cover Class A Units obligations, if
necessary. Class A's current Reserve Assets are comprised of a guaranteed
investment contract.
At March 31, 1996, approximately 54% and 46% of the Class A net assets were
allocated to the Class A Traded Assets and Reserve Assets, respectively. One
hundred percent of the Class B net assets continue to be committed to the Class
B Traded Assets. A significant portion of the Class A Traded Assets and the
Class B Traded Assets (the ``Traded Assets'') was held in U.S. Treasury bills
(which represented approximately 75% of the Traded Assets, prior to redemptions
payable) and cash, which are used as margin for the Partnership's trading in
commodities. Inasmuch as the sole business of the Partnership is to trade in
commodities, the Partnership continues to own such liquid assets to be used as
margin.
The percentage that U.S. Treasury bills and the Reserve Assets bear to the
Traded Assets varies each day, and from month to month, as the market values of
commodity interests change. The balance of the total net assets is held in cash.
All interest earned on the Partnership's interest-bearing funds is paid to the
Partnership.
The commodities contracts themselves are subject to periods of illiquidity
because of market conditions, regulatory considerations and other reasons. For
example, commodity exchanges limit fluctuations in commodity futures contract
prices during a single day by regulations referred to as ``daily limits.''
During a single day, no trades may be executed at prices beyond the daily limit.
Once the price of a futures contract for a particular commodity has increased or
decreased by an amount equal to the daily limit, positions in the commodity can
neither be taken nor liquidated unless traders are willing to effect trades at
or within the limit. Commodity futures 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 commodity
futures positions.
Since the Partnership's business is to trade futures, forward and options
contracts, its capital is at risk due to changes in the value of these contracts
(market risk) or the inability of counterparties to perform under the terms of
the contracts (credit risk). The General Partner attempts to minimize these
risks by requiring the Partnership's trading managers to abide by various
trading limitations and policies. See Note C to the financial statements for a
further discussion on the credit and market risks associated with the
Partnership's futures, forward and options contracts.
Redemptions by limited partners and the General Partner recorded from
commencement of operations, January 7, 1992 through March 31, 1996 totalled
$8,307,427 for Class A Units (including $86,911 General Partner redemptions) and
$1,584,272 for Class B Units (including $16,086 General Partner redemptions).
Future redemptions will impact the amount of funds available for investment in
commodity contracts in subsequent periods. For the quarter ended March 31, 1996,
there were no exchanges of Units. From the inception of the Partnership, there
were exchanges of 50 Class A Units for 50.153 Class B Units.
The Partnership does not have, nor does it expect to have, any capital
assets.
The letter of credit is intended to provide protection to the Class A limited
partners against loss of their initial investment as of March 31, 1997 (the
``Capital Return Date'') when the limited partners will have the option to
redeem their Class A Units and receive the greater of the then current net asset
value per Class A Unit or 100% of their initial investment. When the letter of
credit expires on the Capital Return Date, Reserve Assets will become available
for commodities trading. Additionally, the General Partner will merge the Class
13
<PAGE>
<PAGE>
A Units and the Class B Units in accordance with Article X, section B(16) of the
Partnership Agreement. Following the Capital Return Date, if the Partnership's
net asset value declines below $5 million the Partnership will dissolve.
Results of Operations
The net asset values per Unit as of March 31, 1996 were $107.83 for Class A
Units and $107.24 for Class B Units, a decrease of 5.07% and 9.32% for Class A
Units and Class B Units, respectively, from the December 31, 1995 values of
$113.59 and $118.26, respectively.
January was marked by profits in the currency, financial, metal and soft
sectors. Profits were offset by losses incurred in energies, meats, and grains.
The largest gains came from the currency, international interest rate, metal and
tropical product sectors. The dollar's strength in relation to the Japanese yen
and Swiss franc provided profit opportunities in the currency markets for the
month. Profitability in the international financial markets was derived from
French, German, and the United Kingdom interest rate futures. There were slight
gains in the U.S. financial markets as well. In the precious metals sector, gold
positions profited from a rise in gold prices late in the month. Gold had been
trading for several years in an increasingly narrow price range below $400 an
ounce. Silver strengthened as well providing Partnership profits. In the
commodity markets, price reversals in the energy sector caused some losses
following profitability from that sector in prior months. However, there were
gains in the coffee market.
The Partnership's performance was negative in the month of February. Profits
earned in the meats, grains, and energies sectors were offset by losses in the
financials, softs, metals and currencies sectors. In the grains sector, gains
were realized in corn where low grain stocks worldwide and indications of strong
demand continued to remain factors. In the meats and energies sectors, positions
in porkbellies and unleaded gas proved profitable. In the financials sector,
positions in U.S., Australian, French, Italian, German and Swiss bonds proved
unprofitable. Global bonds reversed a long-term downward trend in yields as
European interest rates rose on stronger than expected economic data and rising
U.S. interest rates. The price of gold fell back below the $400 level only one
month after breaking that threshold for the first time in over two years,
producing trading losses in that area.
The Partnership's performance was negative in the month of March. Profits
earned in the energies, meats, grains and softs sectors were offset by losses in
the currencies, financials, and metals sectors. In the financial sector, losses
were taken in selling Australian, British, Canadian, French, German, Japanese
and Swiss bond positions. Except for Japan, world bond prices reacted negatively
to a fall in U.S bond prices as U.S. non-farm payroll employment in January was
much greater than market expectations and the U.S. Federal Open Market Committee
voted to keep the federal funds rate unchanged at its February meeting. This
changed the sentiment of global bond market participants such that further
short-term interest rate cuts seemed unlikely. Profits in crude oil occurred as
prices rose on indications of tight supplies. Oil inventories were at historic
lows and oil purchasers were reluctant to add to inventories in the face of
possible sales of Iraqi oil which could cause lower prices. The Partnership made
profits in grains, as the demand for grains, particularly in the Far East,
remained strong. At the end of the month, the market was further helped by lower
than expected U.S. crop planting intention figures.
Trading gains and losses and expenses (other than those expenses that are
particular to Class A Units) are allocated between the Class A Units and Class B
Units based upon the pro rata portion of the Partnership's Traded Assets to each
Class. See Note A in the financial statements for further details.
Interest income from U.S. Treasury bills for the Class A Units and Class B
Units and interest from Reserve Assets for Class A Units remained virtually
unchanged for the three months ended March 31, 1996 as compared to the
corresponding period in 1995.
Commissions paid to PSI are calculated on the Partnership's Traded Assets on
the first day of each month and, therefore, vary according to trading
performance and redemptions. Accordingly, they must be compared to the
fluctuations in the monthly net asset values of the Traded Assets. Commissions
increased by approximately $6,000 for Class A Units and remained virtually
unchanged for Class B Units, respectively, for the three months ended March 31,
1996 as compared to the corresponding period in 1995.
Other transaction fees represent National Futures Association, exchange,
floor brokerage and clearing fees which are based on the number of trades the
trading managers execute. These transaction fees increased by approximately
$4,000 for Class A Units and $500 for Class B Units, respectively, for the three
14
<PAGE>
<PAGE>
months ended March 31, 1996 as compared to the corresponding period in 1995
primarily due to an increase in trading volume.
All trading decisions for the Partnership are currently being made by
Willowbridge Associates Inc. and Sjo, Inc. (the ``Trading Managers'').
Management fees are calculated on the portion of the Partnership's Traded Assets
allocated to each Trading Manager at the end of the month and, therefore, are
affected by trading performance and redemptions. Management fees increased by
approximately $5,000 for Class A Units and $600 for Class B Units, respectively,
for the three months ended March 31, 1996 as compared to the corresponding
period in 1995 primarily due to favorable trading performance in May 1995
offset, in part, by the effect of redemptions on monthly Traded Assets.
Incentive fees are based on the New High Net Trading Profits generated by
each Trading Manager, as defined in the Advisory Agreement between the
Partnership, the General Partner and each Trading Manager. No incentive fees
were earned for the Class A and Class B Units for the three months ended March
31, 1996 and 1995.
Letter of Credit fees paid by Class A Units to Citibank, N.A. and Prudential
Securities Group Inc. decreased by approximately $2,000 for the three months
ended March 31, 1996 as compared to the corresponding period in 1995 due to the
effect of redemptions on the outstanding balance of the letter of credit.
General and administrative expenses remained virtually unchanged for Class A
Units and increased by approximately $4,000 for Class B Units, respectively, for
the three months ended March 31, 1996 as compared to the corresponding period in
1995. These expenses include reimbursements of costs incurred by the General
Partner on behalf of the Partnership in addition to accounting, audit, tax and
legal fees and printing and postage costs related to reports sent to limited
partners. This Class B Units' increase was primarily due to the timing of
certain expense accruals recorded in the respective periods.
15
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings--There are no material legal proceedings pending by or
against the Registrant or the General Partner.
Item 2. Changes in Securities--None
Item 3. Defaults Upon Senior Securities--None
Item 4. Submission of Matters to a Vote of Security Holders--None
Item 5. Other Information--None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Description:
3.1 Agreement of Limited Partnership of the Registrant, dated as of
and April 30, 1991 as amended and restated as of July 1, 1991 and
4.1 October 28, 1991 (incorporated by reference to Exhibit A to
the Registrants' Registration Statement on Form S-1, File
No. 33-40730)
4.1.1 Amendment to Agreement of Limited Partnership of the Registrant
dated November 5, 1991 (incorporated by reference to Exhibit
4.1.1 of the Registrant's Annual Report on Form 10-K for the
year ended December 31, 1992)
4.2 Subscription Agreement (incorporated by reference to Exhibit
E to the Registrant's Registration Statement on Form S-1,
File No. 33-40730)
4.3 Request for Redemption (incorporated by reference to Exhibit
B-1 to the Registrant's Registration Statement on Form S-1,
File No. 33-40730)
4.4 Request for Exchange (incorporated by reference to Exhibit
B-2 to the Registrant's Registration Statement on Form S-1,
File No. 33-40730)
10.12 Form of Foreign Currency Addendum to Brokerage Agreement
between the Registrant and PSI (filed herewith)
27.1 Financial Data Schedule (filed herewith)
(b) Reports on Form 8-K--None
16
<PAGE>
SIGNATURES
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.
Prudential Securities OptiMax Futures Fund 2, L.P.
By: Seaport Futures Management, Inc.
A Delaware corporation, General Partner
By: /s/ Steven Carlino Date: May 15, 1996
----------------------------------------
Steven Carlino
Vice President
Chief Accounting Officer for the
Registrant
17
<PAGE>
FOREIGN CURRENCY ADDENDUM
This addendum ("Addendum) supplements the terms and conditions of
the Futures Account Client Agreement ("Agreement") entered into by and
between Prudential Securities OptiMax Futures Fund 2, L.P. ("Customer")
and Prudential Securities Incorporated ("PSI") as of ___________, 199__.
In consideration of PSI agreeing to enter into various forward and
spot foreign currency and foreign currency options transactions
(collectively "Forex Contracts") with Customer, the parties agree
as follows:
1. Relationship to Agreement. Except as otherwise provided in
this Addendum, the terms and conditions of the Agreement shall remain
in full force and effect, and shall apply to all Forex Contracts that
PSI may transact with Customer. If there are any conflicts between
the terms and conditions of the Agreement and this Addendum, the terms
and conditions of this Addendum will govern with respect to Forex
Contracts.
2. Forex Contracts. PSI and Customer will each act as principals
with respect to Forex Contracts. Forex Contracts will be transacted within
the non-regulated portion of Customer's PSI futures account. Customer
acknowledges that Forex Contracts are not traded on or guaranteed by a
regulated exchange or its clearing house and accordingly, acknowledges
that trading in Forex Contracts is not subject to the same regulatory
or financial protections as is trading in futures contracts. Customer
represents and warrants that (a) it is authorized to enter into Forex
Contracts, (b) it understands that as principal opposite PSI the parties
will each be relying on the creditworthiness of the other, (c) each
Forex Contract will be individually negotiated as to its material
economic terms, and (d) PSI will be entitled to rely on any instructions,
notices and communications that it reasonably believes to have originated
with any authorized representative of Customer, including a person with
a Power of Attorney over trading decisions, and Customer shall be
bound thereby.
3. Limits. This Addendum does not evidence a commitment of PSI
or Customer to enter into Forex Contracts generally or to enter into
any specific Forex Contract. PSI shall have the right to set limits
on the number of Forex Contracts that PSI will transact with Customer.
PSI reserves the right to increase or decrease such limits as, in PSI's
good faith judgment, market and economic conditions warrant, including
but not limited to the material change in Customer's credit rating or
Customer's country or sovereign rating by an internationally recognized
rating agency. Additionally, PSI reserves the right, exercisable at
any time when warranted by market conditions in PSI's sole discretion,
to refuse acceptance of Customer's orders.
4. Confirmations. Upon entering into a Forex Contract with
Customer, PSI shall verbally confirm the economic terms to Customer
followed by a written confirmation (via letter, telex, facsimile or
telecopier at PSI's election) (the "Confirmation) specifying the
amount of
<PAGE>
foreign currency bought or sold by Customer against U.S.
dollars or another foreign currency, the exchange rate, and the date
on which, and the location where, the currency is to be delivered.
Confirmations shall be conclusive and binding on Customer unless
Customer promptly notifies PSI of any objection within three (3) days
of receipt by Customer of the Confirmation.
5. Collateral; Settlement. PSI reserves the right to require
customer to deposit collateral with respect to Forex Contract
transactions. All Forex Contracts will be transacted pursuant
to a line of credit or will be otherwise collateralized at PSI's
option, and will be subject to the netting provisions set forth in
Section 8 below. All payments due under a Forex Contract shall be
made by wire transfer on the delivery date specified in the Confirmation
in immediately available funds in the designated currency. In the
event that either party's performance of its payment obligations
shall be interrupted or delayed by reason of war, riot, civil
commotion, sovereign conduct or other acts of state, the time of
performance of such party's obligations shall be extended for the
period of such interruption.
6. Dispute Resolution. Any dispute between Customer and PSI
relating to Customer's Forex Contracts shall be settled and determined
by an arbitration panel of either the New York Stock Exchange, the
National Association of Securities Dealers Inc., or the National
Futures Association as Customer may elect, or if the foregoing qualified
forums decline to arbitrate such dispute, before such forum as may be
agreed upon between the parties. At such time that PSI notifies Customer
of its intent to submit a claim to arbitration Customer will have seven
business days to elect a qualified forum for conducting the proceeding.
If Customer fails to notify PSI of its selection within seven business
days, PSI shall have the absolute right to make such selection.
7. Governing Law. The interpretation and enforcement of this
Addendum (and the Forex Contracts covered hereunder) and the rights,
obligations and remedies of the parties shall be governed by and
construed in accordance with the laws of the State of New York,
without regard to principles of choice of law.
8. Netting Provisions.
(a) Netting by Novation. Unless separately agreed and set out
in the Confirmation regarding a specific Forex Contract, each Forex
Contract made between Customer and PSI will immediately, upon its
being entered into, be netted with all then existing Forex Contracts
between Customer and PSI for the same paired currencies having the
same delivery date. Each Forex Contract containing an obligation to
deliver that has been netted pursuant to the foregoing shall immediately
be deemed cancelled and simultaneously replaced by a single transaction.
For purposes hereof, each Forex Contract shall be deemed a Forex
Contract from and after its inception for all purposes.
(b) Payment Netting. If on any delivery date more than one
delivery of a particular currency is to be made between Customer and
PSI pursuant to a Forex Contract,
2
<PAGE>
each party shall aggregate the amounts deliverable by it and only
the difference, if any, between these aggregate amounts shall be
delivered by the party owing the larger amount to the other party.
(c) Discharge and Termination of Options. Any call option or
any put option written by a party will automatically be terminated and
discharged, in whole or in part, as applicable, against a call option
or a put option, respectively, written by the other party, such
termination and discharge to occur automatically upon the payment
in full of the premium payable in respect of such options; provided
that such termination and discharge may occur only in respect of
options:
(i) each being with respect to the same put currency and
the same call currency;
(ii) each having the same expiration date and expiration time;
(iii) each being of the same style, i.e. both being
America Style options or both being European Style options;
(iv) each having the same strike price; and
(v) neither of which shall have been exercised by delivery
of a notice of exercise;
and, upon the occurrence of such termination and discharge,
neither party shall have any further obligation to the other party in
respect of the relevant options or, as the case may be, parts thereof
so terminated and discharged. In the case of a partial termination and
discharge (i.e., where the relevant options are for different amounts
of the currency), the remaining portion of the option that is partially
discharged shall continue to be a Forex Contract for all purposes of
this Addendum.
(d) The occurrence at any time with respect to a party of any of
the following events constitutes an event of default (an Event of
Default ) with respect to such party:
(i) Failure to Pay or Deliver. Failure by the party to make,
when due, any payment under this Addendum or delivery required to be
made by it if such failure is not remedied on or before the third
business day after notice of such failure is given to such party;
(ii) Breach of Agreement. Failure by the party to comply
with or perform any agreement or obligation under this Addendum if
such failure is not remedied on or before the third business day after
notice of such failure is given to the Defaulting Party:
3
<PAGE>
(iii) Failure to Provide Adequate Assurances. Failure
by Customer to provide adequate assurances of its ability to perform
any of its obligations under this Addendum within three business days
of a written request from PSI to do so when PSI has reasonable grounds
for insecurity;
(iv) Bankruptcy. The Party - (A) is dissolved (other than
pursuant to a consolidation, amalgamation or merger); (B) becomes
insolvent or is unable to pay its debts or fails or admits in writing
its inability generally to pay its debts as they become due; (C) makes
a general assignment, arrangement or composition with or for the
benefit of its creditors; (D) institutes or has instituted against
it a proceeding seeking a judgment of insolvency or bankruptcy or
any other relief under any bankruptcy or insolvency law or other
similar law affecting creditors rights, or a petition is presented
for its winding-up or liquidation, and, in the case of any such
proceeding or petition instituted or presented against it, such
proceeding or petition (1) results in a judgment or insolvency or
bankruptcy or the entry of an order for relief or the making of an
order for its winding-up or liquidation or (2) is not dismissed,
discharged, stayed or restrained in each case within 30 days of the
institution or presentation thereof; (E) has a resolution passed for
its winding-up, official management or liquidation (other than pursuant
to a consolidation, amalgamation or merger); (F) seeks or becomes
subject to the appoint of an administrator, provisional liquidator,
conservator, receiver, trustee, custodian or other similar official
for it or for all or substantially all of its assets; (G) has a secured
party take possession of all or substantially all of its assets or has
a distress, execution, attachment, sequestration or other legal process
levied, enforced or sued on or against all or substantially all of its
assets and such secured party maintains possession, or any such process
is not dismissed, discharged, stayed or restrained, in each case within
30 days thereafter; (H) causes or is subject to any event with respect
to it which, under the applicable laws of any jurisdiction, has an
analogous effect to any of the events specified in clauses (A) to
(G) (inclusive); or (i) takes any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any
of the foregoing acts.
(e) Close-Out Netting. If an Event of Default has occurred and
is continuing in respect of a party ("Defaulting Party"), the other
party ("Non-Defaulting Party") shall be entitled in its reasonable
discretion, immediately and at any time and upon notice (unless such
notice cannot practicably be provided in the circumstances) to close-out
all Defaulting Party's Forex Contracts, and may in its reasonable
discretion at any time or from time to time upon notice (unless such
notice cannot practicably be provided in the circumstances) liquidate
all or some of Defaulting Party's collateral in Non-Defaulting Party's
possession or control on any commercially reasonable basis and apply the
proceeds of such collateral to any
4
<PAGE>
amounts owing by Defaulting Party to Non-Defaulting Party resulting
from the close-out of such Forex Contracts. Any such close-out of
Forex Contracts shall be accomplished by the Non-Defaulting Party:
(i) closing-out each such Forex Contract so that each such
Forex Contract is cancelled and calculating settlement amounts
equal to the difference between the market value (as determined by PSI
in good faith) and contract value of the Forex Contract or, in the case
of options, settlement amounts equal to the current market premium for
a comparable option (as determined by PSI in good faith); (ii) discounting
each settlement amount then due to present value at the time of close-out
(to take into account the period between the date of close-out and the
maturity date of the relevant liquidated Forex Contract using an interest
rate equal to PSI's cost of funds as determined by PSI in good faith);
(iii) calculating an aggregate settlement payment in an amount equal
to the net amount of such discounted settlement amounts as is then due
from one party to the other; and (iv) setting off the settlement payments,
if any, that Non-Defaulting Party owes Defaulting Party as a result of
such liquidation and all collateral held by or for Non-Defaulting Party
against the settlement payments, if any, that Defaulting Party owes to
Non-Defaulting Party as a result of such close-out; so that all such
amounts are netted to a single liquidated amount payable by one party
to the other party, as appropriate, on the business day following the
close-out.
Notwithstanding anything to the contrary set forth above
regarding the Non- Defaulting Party's rights to close-out and value
Forex Contracts, if an event specified in clause (iv) of this sub-section
(d) has occurred, then upon the occurrence of such event, all outstanding
Forex Contracts will be deemed to have been automatically terminated as
of the time immediately preceding the institution of the relevant
proceeding, or the presentation of the relevant petition upon the
occurrence with respect to the party to such specified event.
The rights of PSI under this sub-section (e) shall be in
addition to, and not in limitation or exclusion of any other rights
that PSI may have (whether by agreement, operation of law or otherwise).
9. Liquidated Damages. The parties agree that the amount owing
by one party to the other party hereunder is a reasonable computation
of the loss or gain it would have incurred or received on the obligations
between the parties governed by this Addendum and is not a penalty.
Such amount is payable as liquidated damages to the other party for
the loss of the benefit of its bargains and neither party shall be
entitled to recover additional damages in respect of such loss of
the bargain. The determination of such amount shall be conclusive,
absent manifest error.
10. Understanding of Risks. Each party will be deemed to represent
to the other party on the date on which it enters into a Forex Contract
that it has the capability to evaluate and understand (on its own behalf
or through independent professional advice), and does understand, the
terms, conditions and risks of that Forex Contract and is willing to
accept those terms and conditions and to assume (financially and
otherwise) those risks.
5
<PAGE>
11. Termination. Each party may terminate this Addendum at
any time on three (3) business days prior written notice. No such
termination shall affect any Forex Contracts entered into prior to
such termination and this Addendum shall continue to govern any such
Forex Contract.
__________________________ ___________________________________
Date Name of Customer
By:_______________________________
Title: ___________________________
Signature:________________________
Accepted By Prudential Securities Incorporated
By:_____________________________ Date: ____________________________
Title:__________________________
Signature: _____________________
6
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial
information extracted from the financial
statements for Pru. Securities OptiMax Futures
Fund 2, L.P. and is qualified in its entirety
by reference to such financial statements
</LEGEND>
<RESTATED>
<CIK> 0000874711
<NAME> Pru. Securities OptiMax Futures Fund 2, L.P.
<MULTIPLIER> 1
<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-START> Jan-1-1996
<PERIOD-END> Mar-31-1996
<PERIOD-TYPE> 3-Mos
<CASH> 1,210,863
<SECURITIES> 7,800,925
<RECEIVABLES> 14,963
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 9,026,751
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 9,026,751
<CURRENT-LIABILITIES> 371,831
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 8,654,920
<TOTAL-LIABILITY-AND-EQUITY> 9,026,751
<SALES> 0
<TOTAL-REVENUES> (289,984)
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 225,290
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (515,274)
<EPS-PRIMARY> (6.22)
<EPS-DILUTED> 0
</TABLE>
