<PAGE>
UNITED STATES
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 June 30, 1999
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: 0-26002
PRUDENTIAL SECURITIES AGGRESSIVE GROWTH FUND L.P.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 13-3702808
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
One New York Plaza, 13th Floor, New York, New York 10292
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(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 AGGRESSIVE GROWTH FUND L.P.
(a limited partnership)
STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------
ASSETS
Equity in commodity trading accounts:
Cash $ 1,078,681 $1,440,981
U.S. Treasury bills, at amortized cost 3,796,835 4,312,089
Net unrealized gain on open commodity positions 220,745 203,654
------------- ------------
Total assets $ 5,096,261 $5,956,724
------------- ------------
------------- ------------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable $ 770,128 $ 280,222
Accrued expenses 82,661 69,230
Management fees payable 8,349 9,806
Options, at market 3,463 2,856
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Total liabilities 864,601 362,114
------------- ------------
Commitments
Partners' capital
Limited partners (41,662.651 and 51,636.285 units outstanding) 4,189,128 5,538,514
General partner (423 and 523 units outstanding) 42,532 56,096
------------- ------------
Total partners' capital 4,231,660 5,594,610
------------- ------------
Total liabilities and partners' capital $ 5,096,261 $5,956,724
------------- ------------
------------- ------------
Net asset value per limited and general partnership unit ('Units') $ 100.55 $ 107.26
------------- ------------
------------- ------------
- ----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements.
</TABLE>
2
<PAGE>
PRUDENTIAL SECURITIES AGGRESSIVE GROWTH FUND L.P.
(a limited partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
June 30, June 30,
----------------------- -----------------------
1999 1998 1999 1998
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------
REVENUES
Net realized gain (loss) on commodity
transactions $(135,123) $ 712,126 $ 24,533 $ 278,907
Change in net unrealized gain on open commodity
positions 17,788 (256,755) (19,825) (358,188)
Interest income 118,433 164,811 56,720 80,763
--------- --------- --------- ---------
1,098 620,182 61,428 1,482
--------- --------- --------- ---------
EXPENSES
Commissions 212,700 252,155 102,189 124,734
Other transaction fees 4,210 6,997 2,545 4,418
Management fees 52,685 63,502 25,409 30,903
General and administrative 76,334 82,318 38,622 40,461
Amortization of organizational costs -- 1,156 -- 574
--------- --------- --------- ---------
345,929 406,128 168,765 201,090
--------- --------- --------- ---------
Net income (loss) $(344,831) $ 214,054 $(107,337) $(199,608)
--------- --------- --------- ---------
--------- --------- --------- ---------
ALLOCATION OF NET INCOME (LOSS)
Limited partners $(341,374) $ 211,913 $(106,260) $(197,610)
--------- --------- --------- ---------
--------- --------- --------- ---------
General partner $ (3,457) $ 2,141 $ (1,077) $ (1,998)
--------- --------- --------- ---------
--------- --------- --------- ---------
NET INCOME (LOSS) PER WEIGHTED AVERAGE LIMITED
AND GENERAL PARTNERSHIP UNIT
Net income (loss) per weighted average limited
and general partnership unit $ (6.77) $ 3.31 $ (2.16) $ (3.17)
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average number of limited and general
partnership units outstanding 50,952 64,643 49,745 62,922
--------- --------- --------- ---------
--------- --------- --------- ---------
- ------------------------------------------------------------------------------------------------------
</TABLE>
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
(Unaudited)
<TABLE>
<CAPTION>
LIMITED GENERAL
UNITS PARTNERS PARTNER TOTAL
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------
Partners' capital--December 31, 1998 52,159.285 $ 5,538,514 $56,096 $ 5,594,610
Net loss -- (341,374) (3,457 ) (344,831)
Redemptions (10,073.634) (1,008,012) (10,107) (1,018,119)
----------- ----------- ------- -----------
Partners' capital--June 30, 1999 42,085.651 $ 4,189,128 $42,532 $ 4,231,660
----------- ----------- ------- -----------
----------- ----------- ------- -----------
- ------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements.
</TABLE>
3
<PAGE>
PRUDENTIAL SECURITIES AGGRESSIVE GROWTH FUND L.P.
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1999
(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 Aggressive Growth Fund L.P. (the
'Partnership') as of June 30, 1999 and the results of its operations for the six
and three months ended June 30, 1999 and 1998. 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, 1998.
New Accounting Guidance
In June 1999, the Financial Accounting Standards Board ('FASB') issued
Statement No. 137, Accounting for Derivative Instruments and Hedging
Activities--Deferral of the Effective Date of FASB Statement No. 133--an
amendment of FASB Statement No. 133, which delayed the effective date of FASB
Statement No. 133, Accounting for Derivative Instruments and Hedging Activities
('SFAS 133'). The Partnership does not believe the effect of adoption of SFAS
133, now required effective January 1, 2001, will be material.
B. Related Parties
The general partner of the Partnership is Prudential Securities Futures
Management Inc. (the 'General Partner'), a wholly owned subsidiary of Prudential
Securities Incorporated ('PSI'). The General Partner and its affiliates perform
services for the Partnership which include, but are not limited to: brokerage
services, accounting and financial management, registrar, transfer and
assignment functions, investor communications, printing and other administrative
services. The costs incurred for these services for the six and three months
ended June 30, 1999 and 1998 were:
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
June 30, June 30,
---------------------- ----------------------
1999 1998 1999 1998
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------
Commissions $ 212,700 $ 252,155 $ 102,189 $ 124,734
General and administrative 38,465 44,868 19,783 21,956
--------- --------- --------- ---------
$ 251,165 $ 297,023 $ 121,972 $ 146,690
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
Expenses payable to the General Partner and its affiliates (which are
included in accrued expenses) as of June 30, 1999 and December 31, 1998 were
$49,776 and $16,583, respectively.
The Partnership's assets are maintained either in trading or cash accounts
with PSI, the Partnership's commodity broker, or for margin purposes, with the
various exchanges on which the Partnership is permitted to trade.
The Partnership, acting through its trading managers, executes
over-the-counter, spot, forward and/or option foreign exchange transactions with
PSI. PSI then engages in back-to-back trading with an affiliate,
Prudential-Bache Global Markets Inc. ('PBGM'). PBGM attempts to earn a profit on
such transactions. PBGM keeps its prices on foreign currency competitive with
other interbank currency trading desks. All over-the-counter currency
transactions are conducted between PSI and the Partnership pursuant to a line of
credit. PSI may require that collateral be posted against the marked-to-market
position of the Partnership.
4
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In addition to interest earned on approximately 75% of Partnership assets
invested in U.S. Treasury bills, PSI credits the Partnership monthly with 100%
of the interest it earns on the average remaining equity balances in the
Partnership's accounts (approximately 25% of Partnership assets).
As of June 30, 1999, a non-U.S. affiliate of the General Partner owns 207.751
limited partnership units of the Partnership.
C. Credit and Market Risk
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 or 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.
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. The Partnership presents 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 and its 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. Additionally, pursuant to each
Advisory Agreement among the Partnership, the General Partner and each trading
manager, the General Partner has the right, among other rights, to terminate a
trading manager if the net asset value allocated to the trading manager declines
by 33 1/3% from the value at the beginning of any year or since the commencement
of trading activities. The decline in net asset value is after giving effect for
distributions and redemptions. 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
June 30, 1999 such segregated assets totalled $3,642,226. 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 $1,486,571 at June 30, 1999.
There are no segregation requirements for assets related to forward trading.
As of June 30, 1999, the Partnership's open futures, forward and options
contracts mature within one year.
5
<PAGE>
At June 30, 1999 and December 31, 1998, gross contract amounts of open
futures, forward and options contracts were:
<TABLE>
<CAPTION>
1999 1998
-------------- -----------------
<S> <C> <C>
Financial Futures and Options Contracts:
Commitments to purchase $ 30,672,283 $24,959,772
Commitments to sell 74,378,423 13,403,515
Currency Futures and Options Contracts:
Commitments to purchase 2,637,654 913,406
Commitments to sell 4,942,634 413,435
Currency Forward Contracts:
Commitments to purchase 4,198,905 112,012
Commitments to sell 4,655,850 --
Other Futures Contracts:
Commitments to purchase 1,568,141 --
Commitments to sell 795,228 2,069,906
</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, forward or options 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 purchase commodities is limited to the
gross contract amounts involved, while the market risk associated with its
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.
At June 30, 1999 and December 31, 1998, the fair value of open futures,
forward and options contracts was:
<TABLE>
<CAPTION>
1999 1998
------------------------ ------------------------
Assets Liabilities Assets Liabilities
-------- ----------- -------- -----------
<S> <C> <C> <C> <C>
Futures Contracts:
Domestic exchanges
Financial $ 85,117 $ 5,775 $ 43,125 $ --
Currencies 61,717 5,735 13,010 14,225
Other 45,638 2,000 21,750 6,870
Foreign exchanges
Financial 169,542 34,518 241,300 1,536
Other 11,296 68,538 19,112 --
Forward Contracts:
Currencies 125,529 161,528 -- 112,012
Options Contracts:
Domestic exchanges
Financial -- 788 -- 656
Currencies -- 2,675 -- 2,200
-------- ----------- -------- -----------
$498,839 $ 281,557 $338,297 $ 137,499
-------- ----------- -------- -----------
-------- ----------- -------- -----------
</TABLE>
6
<PAGE>
The following tables present the average fair value of futures, forward and
options contracts during the six and three months ended June 30, 1999 and 1998,
respectively:
<TABLE>
<CAPTION>
For the six months ended
-----------------------------------------------------
<S> <C> <C> <C> <C>
June 30, 1999 June 30, 1998
------------------------ ------------------------
Assets Liabilities Assets Liabilities
-------- ----------- -------- -----------
Futures Contracts:
Domestic exchanges
Financial $ 36,466 $ 5,159 $ 18,554 $ 2,746
Currencies 114,820 17,116 99,323 10,422
Other 28,295 3,651 38,387 2,633
Foreign exchanges
Financial 127,979 21,293 150,899 18,175
Other 19,296 28,140 14,277 7,822
Forward Contracts:
Currencies 117,051 82,951 82,893 214,759
Options Contracts:
Domestic exchanges
Financial 2,850 3,500 -- 13,386
Currencies -- 2,623 -- 3,363
Foreign exchanges
Financial -- 436 -- --
-------- ----------- -------- -----------
$446,757 $ 164,869 $404,333 $ 273,306
-------- ----------- -------- -----------
-------- ----------- -------- -----------
</TABLE>
<TABLE>
<CAPTION>
For the three months ended
-----------------------------------------------------
<S> <C> <C> <C> <C>
June 30, 1999 June 30, 1998
------------------------ ------------------------
Assets Liabilities Assets Liabilities
-------- ----------- -------- -----------
Futures Contracts:
Domestic exchanges
Financial $ 29,160 $ 7,378 $ 17,603 $ 3,572
Currencies 173,475 6,043 125,029 9,840
Other 24,235 825 31,873 2,900
Foreign exchanges
Financial 91,401 19,401 129,688 22,464
Other 9,316 49,244 4,573 50
Forward Contracts:
Currencies 170,183 79,951 73,925 282,716
Options Contracts:
Domestic exchanges
Financial 4,988 5,060 -- 21,441
Currencies -- 3,197 -- 1,541
Foreign exchanges
Financial -- 764 -- --
-------- ----------- -------- -----------
$502,758 $ 171,863 $382,691 $ 344,524
-------- ----------- -------- -----------
-------- ----------- -------- -----------
</TABLE>
7
<PAGE>
The following table presents trading revenues from futures, forward and
options contracts during the six and three months ended June 30, 1999 and 1998,
respectively.
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
June 30, June 30,
----------------------- -----------------------
1999 1998 1999 1998
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Futures Contracts:
Domestic exchanges
Financial $ (88,447) $ (49,407) $ (9,827) $ (15,475)
Currencies 216,838 8,853 130,138 (13,395)
Other (13,970) 61,707 545 (13,856)
Foreign exchanges
Financial (235,850) 697,380 27,570 198,791
Other (80,345) 80,734 (94,841) 42,063
Forward Contracts:
Currencies 48,491 (409,046) (66,796) (306,889)
Options Contracts:
Domestic exchanges
Financial 26,198 63,249 10,619 35,230
Currencies 7,788 1,901 5,338 (5,750)
Foreign exchanges
Financial 1,962 -- 1,962 --
--------- --------- --------- ---------
$(117,335) $ 455,371 $ 4,708 $ (79,281)
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
8
<PAGE>
PRUDENTIAL SECURITIES AGGRESSIVE GROWTH FUND 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 trading operations on August 2, 1993 with net
proceeds of $10,180,534. The Partnership continued to offer Units on a monthly
basis until the continuous offering was terminated on January 31, 1995.
Additional contributions raised through the continuous offering resulted in
additional net proceeds to the Partnership of $9,988,243.
At June 30, 1999, 100% of the Partnership's total net assets were allocated
to commodities trading. A significant portion of the net asset value was held in
U.S. Treasury bills (which represented approximately 76% of the net asset value
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 commodity contracts are subject to periods of illiquidity because of
market conditions, regulatory considerations and other reasons. For example,
commodity exchanges limit fluctuations in certain 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 daily 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 Partnership's exposure to market risk is
influenced by a number of factors including the volatility of interest rates and
foreign currency exchange rates, the liquidity of the markets in which the
contracts are traded and the relationships among the contracts held. The
inherent uncertainty of the Partnership's speculative trading as well as the
development of drastic market occurrences could result in monthly losses
considerably beyond the Partnership's experience to date and could ultimately
lead to a loss of all or substantially all of investors' capital. The General
Partner attempts to minimize these risks by requiring the Partnership and its
trading managers to abide by various trading limitations and policies, which
include limiting margin amounts, trading only in liquid markets and utilizing
stop loss provisions. 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 recorded for the six and three months ended June 30, 1999 were
$1,008,012 and $762,486, respectively, for the limited partners and $10,107 and
$7,642, respectively, for the General Partner, and from commencement of
operations, August 2, 1993 through June 30, 1999, totalled $15,132,232 for
limited partners and $152,918 for the General Partner. Future redemptions will
impact the amount of funds available for investment in commodity contracts in
subsequent periods.
The Partnership does not have, nor does it expect to have, any capital
assets.
Results of Operations
The net asset value per Unit as of June 30, 1999 was $100.55, a decrease of
6.26% from the December 31, 1998 net asset value per Unit of $107.26.
Quarterly Market Overview
In the United States, as economic indicators strengthened and the Federal
Reserve Bank announced they would raise interest rates, the U.S. dollar rose
against most major currencies, especially European which were spurred by
deteriorating confidence in the Euro. Throughout the second quarter, several
issues weighed on world markets including significant price declines in global
long-term interest bonds, the U.S. Federal Reserve's tightening of monetary
policy, and an increased supply of corporate debt. Furthermore, as the U.S.
economy generated strength, investors feared possible inflation. U.S. bond
prices fell, followed
9
<PAGE>
by European bonds which were depressed by rumors regarding Italy's retreat from
the European Economic Union. Global stock markets recorded gains over the
quarter, supported by solid corporate earnings, and improved economies
(especially Asian). In the commodity markets, the energy sector rallied as OPEC
announced production cuts and lower inventories in oil and gasoline. A
consistent tone prevailed in the agricultural and soft commodity markets as
favorable seasonal growing conditions continued to weigh on prices.
Quarterly Partnership Performance
The Partnership captured gains in the currency sector from positions in the
Canadian dollar and Swiss franc. Falling gold prices adversely affected the
Canadian dollar. As prices fell to a 20-year low, gold based currencies (i.e.
Canadian dollar) tumbled as well. The Canadian dollar also weakened when the
Bank of Canada lowered interest rates early in June and is reportedly
considering another cut in the near future. The Swiss franc fell in value versus
the U.S. dollar after losing its safe haven attraction as the war in Kosovo
ended, and as the U.S. dollar gained strength when the Federal Reserve increased
the U.S. interest rates by .25%.
In the financial sector, trading in German, British gilt, and Spanish 10-year
bonds was profitable. Global bond markets followed the lead of the U.S. bond
market to higher interest rates and lower bond prices. On June 30, the Federal
Reserve Open Market Committee raised the Federal Funds rate by 25 basis points.
European bonds benefited from this rise in U.S. interest rates.
Profits were recorded in the energy sector driven by long light crude oil and
natural gas positions. Crude oil products rallied as extremely hot U.S. weather
drove utility demand. Gas products experienced low inventories throughout the
second quarter of 1999.
Losses were incurred in the metal sector led by silver, copper, and aluminum.
Base metals rallied sharply following announcements that two major companies
would significantly cut copper output. If carried out, the estimated production
cuts would almost eliminate the estimated global copper supply surplus. Silver
experienced extreme volatility throughout the second quarter, and failed to
recognize a trend. Additionally, aluminum rallied in the beginning of April.
However, this bullish market gave back almost 50% of its March-April profits
during the first week in May.
Interest income is earned on the Partnership's investment in U.S. Treasury
bills (approximately 75% of its net asset value) and on the remaining 25% of its
net asset value which receives an interest credit from PSI. Interest income
varies monthly according to interest rates as well as the effect of trading
performance and redemptions on the level of interest-bearing funds. Interest
income decreased by approximately $46,000 and $24,000 for the six and three
months ended June 30, 1999 compared to the corresponding periods in 1998. The
decline in interest income was the result of lower interest rates in 1999 as
well as fewer funds being invested in U.S. Treasury bills due to redemptions.
Commissions are calculated on the Partnership's net asset value as of the
first day of each month and, therefore, vary according to trading performance
and redemptions. Commissions decreased by approximately $39,000 and $23,000 for
the six and three months ended June 30, 1999 as compared to the corresponding
periods in 1998 primarily due to the effect of redemptions on the monthly net
asset values.
Other transaction fees consist of National Futures Association, exchange and
clearing fees which are based on the number of trades the trading managers
execute. Other transaction fees decreased by approximately $3,000 and $2,000
during the six and three months ended June 30, 1999 as compared to the
corresponding periods in 1998. These declines were due to a decrease in trading
volume resulting from lower average net assets caused by redemptions.
All trading decisions are currently being made by Eagle Trading Systems, Inc.
and Welton Investment Corporation (the 'Trading Managers'). Management fees are
calculated on the portion of the Partnership's net asset value allocated to each
Trading Manager at the end of each month and, therefore, are affected by trading
performance and redemptions. Management fees decreased by approximately $11,000
and $5,000 for the six and three months ended June 30, 1999 as compared to the
corresponding periods in 1998 primarily for the same reason commissions
decreased as described above.
Incentive fees are based on the New High Net Trading Profits generated by
each Trading Manager, as defined in the Advisory Agreement among the
Partnership, the General Partner and each Trading Manager. No incentive fees
were earned during the six and three months ended June 30, 1999 and 1998.
10
<PAGE>
General and administrative expenses decreased by approximately $6,000 and
$2,000 for the six and three months ended June 30, 1999 as compared to the same
periods in 1998. 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 as well as printing and postage costs related to reports sent
to limited partners.
New Accounting Guidance
In June 1999, the Financial Accounting Standards Board ('FASB') issued
Statement No. 137, Accounting for Derivative Instruments and Hedging
Activities--Deferral of the Effective Date of FASB Statement No. 133--an
amendment of FASB Statement No. 133, which delayed the effective date of FASB
Statement No. 133, Accounting for Derivative Instruments and Hedging Activities
('SFAS 133'). The Partnership does not believe the effect of adoption of SFAS
133, now required effective January 1, 2001, will be material.
Year 2000 Risk
A discussion of Year 2000 risk and its effect on the operations of the
Partnership is included in the Partnership's annual report on Form 10-K filed
with the Securities and Exchange Commission for the year ended December 31,
1998.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Information regarding quantitative and qualitative disclosures about market
risk is not required pursuant to Item 305(e) of Regulation S-K.
11
<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. (a) Exhibits--
3.1 --Agreement of Limited Partnership of the Registrant, dated as
of March 19, 1993 as amended and restated as of May 6, 1993
(Incorporated by reference to Exhibit A to Registrant's
Amendment No. 1 to Registration Statement on Form S-1, File
No. 33-59828 dated May 7, 1993)
27.1 --Financial Data Schedule (filed herewith)
(b) Reports on Form 8-K--None
12
<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 hereunto duly authorized.
PRUDENTIAL SECURITIES AGGRESSIVE GROWTH FUND L.P.
By: Prudential Securities Futures Management Inc.
A Delaware corporation, General Partner
By: /s/ Steven Carlino Date: August 13, 1999
----------------------------------------
Steven Carlino
Vice President and Treasurer
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial
information extracted from the financial
statements for Prudential Securities Aggressive
Growth Fund, L.P. and is qualified in its
entirety by reference to such financial statements
</LEGEND>
<RESTATED>
<CIK> 0000899174
<NAME> Prudential Securities Aggressive Growth Fund, L.P.
<MULTIPLIER> 1
<FISCAL-YEAR-END> Dec-31-1999
<PERIOD-START> Jan-1-1999
<PERIOD-END> Jun-30-1999
<PERIOD-TYPE> 6-Mos
<CASH> 1,078,681
<SECURITIES> 4,017,580
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 5,096,261
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,096,261
<CURRENT-LIABILITIES> 864,601
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 4,231,660
<TOTAL-LIABILITY-AND-EQUITY> 5,096,261
<SALES> 0
<TOTAL-REVENUES> 1,098
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 345,929
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (344,831)
<EPS-BASIC> (6.77)
<EPS-DILUTED> 0
</TABLE>
