Morgan Stanley Dean Witter Spectrum Series
Monthly Report
September 1999
Dear Limited Partner:
The Net Asset Value per Unit for each of the four Morgan Stanley Dean
Witter Spectrum Funds as of September 30, 1999 was as follows:
Funds N.A.V. % change for month
Spectrum Global Balanced $15.79 -0.50%
Spectrum Select $22.88 1.68%
Spectrum Strategic $15.28 13.30%
Spectrum Technical $15.66 -1.50%
In Spectrum Global Balanced, a balanced portfolio of stocks, bonds and
managed futures, losses were recorded during September in the global stock
index futures component from long German stock index futures positions as
prices dropped following a decline in U.S. stock prices and insecurity
about the further course of U.S. interest rates. In the currency markets,
losses were recorded from short positions in the Swiss franc and the
European common currency, the euro, as these currencies strengthened versus
the U.S. dollar during the latter half of September, after the July U.S.
trade figures reflected a record deficit. In the global interest rate
component of the balanced portfolio, losses were experienced from long
positions in British interest rate futures as prices fell after the Bank of
England surprisingly raised interest rates. Offsetting gains in this
market sector were recorded from long U.S. interest rate futures positions
as domestic bond prices moved higher during mid-month on the release of
benign inflation data and diminished fears of another interest rate
increase by the Federal Reserve. A portion of the Fund's overall losses
for the month was offset by gains recorded in the energy markets from long
positions in crude oil and gas futures as oil prices climbed above
$25/barrel to a 33-month high after OPEC ministers confirmed that they will
uphold their global cutbacks until April of next year. Reports of
declining crude oil and gasoline inventories also boosted prices in this
market. Additional profits were recorded in the metals markets from long
nickel futures positions as most base metal prices moved higher, aided by
perceptions of improving Asian demand and a drop in warehouse stocks.
Spectrum Select, a Fund managed by multiple trading advisors who employ
long-term technical trend-following trading strategies, gains were recorded
during September primarily in the currency markets from long positions in
the Japanese yen as the value of the yen climbed to a 44-month high versus
the U.S. dollar amid continued optimism regarding the Japanese economy.
Additional gains were recorded from long positions in crude oil and its
refined products, unleaded gasoline and heating oil, as oil prices climbed
above $25/barrel to a 33-month high after OPEC ministers confirmed that
they will uphold their global cutbacks until April of next year. Reports
of declining crude oil and gasoline inventories also boosted prices in this
market. In the metals markets, gains were recorded from newly established
long positions in gold futures as gold prices soared higher during the
month, sparked by the Bank of England's second gold auction on September
21, which was received positively. The rally in gold prices escalated
further following the announcement of a plan by the European and Swiss
central banks to restrict gold sales for five years. A portion of overall
Fund gains for the month was offset by losses recorded in the global stock
index futures from long positions in Hang Seng Index futures as Hong Kong
stocks followed domestic equity prices lower on fears of a U.S. interest
rate hike. Losses were also recorded from short-term price volatility in
global interest rate futures. Smaller losses were recorded in the soft
commodities markets from long positions in sugar futures as sugar prices
declined following the release of the USDA's production forecast report,
which raised production forecasts for both the current and upcoming years.
In Spectrum Strategic, a Fund managed by multiple trading advisors who
employ fundamental trading methodologies, strong gains were recorded during
September in the metals markets from long gold futures positions as prices
skyrocketed during the month following the Bank of England's second gold
auction on September 21. The rally in gold prices continued following the
announcement of a plan by the European and Swiss central banks to restrict
gold sales for five years. Additional gains were recorded from long silver
futures positions as silver prices increased following gold's lead. In the
energy markets, gains were recorded from long crude oil futures positions
as oil prices climbed above $25/barrel to a 33-month high after OPEC
ministers confirmed that they will uphold their global cutbacks through the
first quarter of
<PAGE>
next year. Reports of declining crude oil and gasoline inventories also
boosted prices in this market. In soft commodities, gains were recorded
from long cocoa futures positions as cocoa prices moved to their highest
levels since early August amid uncertainty about how a liberalized cocoa
market in the Ivory Coast and the Indonesian conflict will affect the
movement of new crop. A portion of the Fund's overall gains was offset by
losses in global interest rate futures as prices moved in a short-term
volatile pattern. In the global stock index futures markets, losses were
experienced during late September from short positions in S&P 500 Index
futures as U.S. equity prices rallied on the last day of the month on
optimism that the Federal Reserve would not raise interest rates at their
October 5th meeting.
In Spectrum Technical, a Fund managed by multiple trading advisors who
employ long-term technical trend-following trading systems, losses were
experienced during September primarily in the global interest rate futures
markets from short positions in Japanese government bond futures as prices
rallied on the strength of the Japanese yen and expectations that
additional monetary easing in that country will come. In the metals
markets, losses were experienced from previously established short gold
futures positions as gold prices reversed suddenly higher during the month,
sparked by the Bank of England's second gold auction September 21, which
was received positively. The rally in gold prices continued following the
announcement of a plan by the European and Swiss central banks to restrict
gold sales for five years. Additional losses were incurred in the global
stock index futures markets from short positions in Nikkei Index futures as
Japanese equity prices, which had moved lower earlier in the month,
reversed higher during the last week of September amid speculation that the
Bank of Japan would intervene to stop the rising yen. A portion of the
Fund's overall losses for the month was offset by gains recorded in the
energy markets from long positions in crude oil and its refined products,
unleaded gasoline and heating oil, as oil prices climbed above $25/barrel
to a 33-month high after OPEC ministers confirmed that they will uphold
their global cutbacks until April of next year. Gains were also recorded
in the currency markets from long positions in the Japanese yen as the
value of the yen climbed to a 44-month high versus the U.S. dollar amid
continued optimism regarding the Japanese economy. Despite an intervention
by the Bank of Japan (BOJ) on September 10, the yen received an extra boost
after the BOJ decided to leave that country's monetary policy unchanged.
Should you have any questions concerning this report, please feel free to
contact Demeter Management Corporation at Two World Trade Center, 62nd
Floor, New York , NY 10048, or your Morgan Stanley Dean Witter Financial
Advisor.
I hereby affirm, that to the best of my knowledge and belief, the
information contained in this report is accurate and complete. Past
performance is not a guarantee of future results.
Sincerely,
Robert E. Murray
President
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 Global Balanced
1994 (2 months) -1.7%
1995 22.8%
1996 -3.6%
1997 18.2%
1998 16.4%
1999 (9 months) -1.3%
Inception-to-Date Return: 57.9%
Annualized Return: 9.7%
___________________________________________________________________________
__________
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 (9 months) -
3.9%
Inception-to-Date Return: 128.8%
Annualized Return 10.7%
___________________________________________________________________________
__________
Spectrum Strategic
1994 (2 months) 0.1%
1995 10.5%
1996 -3.5%
1997 0.4%
1998 7.8%
1999 (9 months) 32.3%
Inception-to-Date Return: 52.8%
Annualized Return: 9.0%
___________________________________________________________________________
__________
Spectrum Technical
1994 (2 months) -2.2%
1995 17.6%
1996 18.3%
1997 7.5%
1998 10.2%
1999 (9 months) -
2.9%
Inception-to-Date Return: 56.6%
Annualized Return: 9.6%
</TABLE>
<PAGE>
<TABLE>
Morgan Stanley Dean Witter Spectrum Series
Statements of Operations
For the Month Ended September 30, 1999
(Unaudited)
<CAPTION>
Morgan Stanley Dean Witter
Morgan Stanley Dean Witter
Spectrum Global
Balanced Spectrum Select
Percent of
Percent of
September 1, 1999
September 1, 1999
Beginning Beginning
Amount Net Asset Value Amount
Net Asset Value
$ % $ %
REVENUES
<S> <C> <C> <C>
<C>
Trading Profit (Loss):
Realized 694,004 1.26 (3,598,788)
(1.69)
Net change in unrealized (918,251) (1.67) 8,316,928
3.91
Total Trading Results (224,247) (0.41) 4,718,140
2.22
Interest Income (DWR) 218,975 0.40 677,146
0.32
Total Revenues (5,272) (0.01) 5,395,286
2.54
EXPENSES
Brokerage fees (DWR) 211,186 0.38 1,284,077
0.61
Management fees 57,388 0.11 531,342
0.25
Incentive fees - -
- - - .
Total Expenses 268,574 0.49 1,815,419
0.86
NET INCOME (LOSS) (273,846) (0.50) 3,579,867
1.68
Morgan Stanley Dean Witter Spectrum Series
Statements of Changes in Net Asset Value
For the Month Ended September 30, 1999
(Unaudited)
Morgan Stanley Dean Witter Morgan
Stanley Dean Witter
Spectrum Global Balanced Spectrum
Select .
Units Amount Per Unit Units
Amount Per Unit
$ $ $
$
<S> <C> <C> <C> <C>
<C> <C>
Net Asset Value,
September 1, 1999 3,472,232.290 55,092,521 15.87 9,444,594.404
212,536,776 22.50
Net Income (Loss) - (273,846) (0.08) -
3,579,867 0.38
Redemptions (24,031.027) (379,450) 15.79 (49,535.196)
(1,133,365) 22.88
Subscriptions 77,555.389 1,224,600 15.79 311,828.303
7,134,632 22.88
Net Asset Value,
September 30, 1999 3,525,756.652 55,663,825 15.79 9,706,887.511
222,117,910 22.88
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 September 30, 1999
(Unaudited)
<CAPTION>
Morgan Stanley Dean Witter Morgan
Stanley Dean Witter
Spectrum Strategic
Spectrum Technical .
Percent of
Percent of
September 1, 1999
September 1, 1999
Amount Net Asset Value Amount
Net Asset Value
$ % $ %
REVENUES
<S> <C> <C> <C>
<C>
Trading Profit (Loss):
Realized 1,684,891 1.90 6,989,743
2.49
Net change in unrealized 11,943,726 13.46 (9,460,209)
(3.36)
Total Trading Results 13,628,617 15.36 (2,470,466)
(0.87)
Interest Income (DWR) 280,211 0.32
902,182 0.32
Total Revenues 13,908,828 15.68 (1,568,284)
(0.55)
EXPENSES
Brokerage fees (DWR) 536,198 0.61 1,699,098
0.61
Management fees 286,239 0.32 937,433
0.34
Incentive fees 1,286,786 1.45 -
- - .
Total Expenses 2,109,223 2.38 2,636,531
0.95
NET INCOME (LOSS) 11,799,605 13.30 (4,204,815)
(1.50)
Morgan Stanley Dean Witter Spectrum Series
Statements of Changes in Net Asset Value
For the Month Ended September 30, 1999
(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,
September 1, 1999 6,579,621.853 88,749,898 13.49 17,684,761.346
281,229,919 15.90
Net Income (Loss) - 11,799,605 1.79 -
(4,204,815) (0.24)
Redemptions (43,212.946) (660,294) 15.28 (100,259.138)
(1,570,058) 15.66
Subscriptions 86,839.005 1,326,900 15.28 250,784.422
3,927,284 15.66
Net Asset Value,
September 30, 1999 6,623,247.912 101,216,109 15.28 17,835,286.630
279,382,330 15.66
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 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 and on physical
commodities, and other commodities interests, including, but
not limited to, foreign currencies, financial instruments,
precious and industrial metals, energy products, and
agriculturals (collectively, "futures interests"). The general
partner for each Partnership is Demeter Management Corporation
("Demeter"). The non-clearing commodity broker is Dean Witter
Reynolds, Inc. ("DWR") and an unaffiliated clearing commodity
broker, Carr Futures Inc. ("Carr"), provides clearing and
execution services. Both Demeter and DWR 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
the General and Limited Partners based upon their proportional
ownership interests.
Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could
differ from those estimates.
Revenue Recognition - Futures interests are open commitments
until settlement date. They are valued at market and the
resulting unrealized gains and losses are reflected in income.
Monthly, DWR pays each Partnership interest income based upon
80% of its average daily "Net Assets" (as defined in the
limited partnership agreements), for the month in the case of
Spectrum Select, Spectrum Strategic and Spectrum Technical and
100% in the case of Spectrum Global Balanced. The interest
rate is equal to a prevailing rate on U.S. Treasury bills. For
purposes of such interest payments, Net Assets do not include
monies due to the Partnership on futures interests, but not
actually received.
Net Income (Loss) per Unit - Net income (loss) per Unit is
computed using the weighted average number of Units outstanding
during the period.
Brokerage and Related Transaction Fees and Costs - Brokerage
fees for Spectrum Global Balanced are accrued at a flat monthly
rate of 1/12 of 4.60% (a 4.60% annual rate) of the Net Assets
as of the first day of each month.
<PAGE>
Morgan Stanley Dean Witter Spectrum Series
Notes to Financial Statements
(Continued)
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 the Net Assets as of the
first day of each month.
Such fee covers all brokerage commissions, 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.
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 on 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 that is 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 are 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 are 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 are not subject to a redemption charge. The
foregoing redemptions charges are 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 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
Each Partnership pays brokerage fees to DWR as described in
Note 1. Each Partnership's cash is on deposit with DWR and Carr
in futures interests trading accounts to meet margin
requirements as needed. DWR pays 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 Global Balanced L.P.
RXR, Inc.
Morgan Stanley Dean Witter Spectrum Select L.P.
EMC Capital Management, Inc.
Rabar Market Research, Inc.
Sunrise Capital Management, Inc.
Morgan Stanley Dean Witter Spectrum Strategic L.P.
Allied Irish Capital Management, Ltd. ("AICM")
Blenheim Investments, Inc. ("Blenheim")
Willowbridge Associates Inc. ("Willowbridge")
Demeter has adjusted the allocation of Net Assets among the
trading advisors within Spectrum Strategic. Commencing with
the June 30, 1999 monthly closing, net proceeds received by
Spectrum Strategic at each monthly closing will be allocated
75% to AICM, 0% to Blenheim, and 25% to Willowbridge
Additionally, 100% of redemptions are allocated to Blenheim.
<PAGE>
Morgan Stanley Dean Witter Spectrum Series
Notes to Financial Statements
(Continued)
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 manage-ment fees and incentive fees as follows:
Management Fee - The management fee for Spectrum Global
Balanced is accrued at a rate of 5/48 of 1% of the 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% per month of the Net Assets allocated to each trading
advisor 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 the Net Assets allocated to each of Blenheim
and Willowbridge on the first day of each month, and 1/12 of 3%
of the 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% per month of the Net Assets allocated to each
trading advisor on the first day of each month (a 4% annual
rate).
Incentive Fee - Spectrum Global Balanced, Spectrum Select and
Spectrum Strategic pay a monthly incentive fee equal to 15% of
the "Trading Profits" as defined in their Limited Partnership
Agreements, 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.
For all Partnerships when Trading Losses are incurred, no
incentive fees are paid in subsequent months until the
individual trading advisor recover their losses. Cumulative
trading losses are adjusted on a pro-rata basis for the net
amount of each months subscriptions and redemptions.
