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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
X Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended March 31, 2005
------------
Commission File Number 0-18500
------------
Alternative Asset Growth Fund, L.P.
------------------------------------------
(Exact name of Partnership)
Delaware 74-2546493
- ----------------------- ------------------------------------
(State of Organization) (I.R.S. Employer Identification No.)
ProFutures, Inc.
11719 Bee Cave Road, Suite 200
Austin, Texas 78738
-------------------------------------
(Address of principal executive office)
Partnership's telephone number
(800) 348-3601
----------------
Indicate by check mark whether the Partnership (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
Partnership was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes [X]
No
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes
No [X]
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
ALTERNATIVE ASSET GROWTH FUND, L.P.
STATEMENTS OF FINANCIAL CONDITION
March 31, 2005 (Unaudited) and December 31, 2004 (Audited)
March 31, December 31,
2005 2004
------------------ ------------------
ASSETS
Equity in broker trading accounts
Cash $ 4,809,436 $ 5,306,718
Option premiums (received) 0 (2,250)
Unrealized gain on open contracts 272,481 216,188
------------------ ------------------
Deposits with broker 5,081,917 5,520,656
Cash 6,921 13,755
------------------ ------------------
Total assets $ 5,088,838 $ 5,534,411
================== ==================
LIABILITIES
Accounts payable $ 31,433 $ 25,185
Commissions and other trading fees
on open contracts 4,923 4,401
Incentive fees payable 35,194 33,562
Management fees payable 49,613 46,885
Redemptions payable 115,704 29,745
------------------ ------------------
Total liabilities 236,867 139,778
------------------ ------------------
PARTNERS' CAPITAL (Net Asset Value)
General Partner - 101 units outstanding
at March 31, 2005 and December 31, 2004 134,782 139,224
Limited Partners - 3,550 and 3,829 units outstanding
at March 31, 2005 and December 31, 2004 4,717,189 5,255,409
------------------ ------------------
Total partners' capital
(Net Asset Value) 4,851,971 5,394,633
------------------ ------------------
$ 5,088,838 $ 5,534,411
================== ==================
See accompanying notes.
ALTERNATIVE ASSET GROWTH FUND, L.P.
CONDENSED SCHEDULES OF INVESTMENTS
March 31, 2005 (Unaudited) and December 31, 2004 (Audited)
March 31, 2005 December 31, 2004
---------------------------- ------------------------------
% of Net % of Net
LONG FUTURES CONTRACTS Value Asset Value Value Asset Value
------------ ------------ ------------ ------------
Agricultural $ (14,715) (0.30)% $27,278 0.51%
Currency (31,503) (0.65)% 51,237 0.95%
Energy 82,741 1.71% (8,600) (0.16)%
Interest rate 102,128 2.10% 24,544 0.45%
Metal 64,450 1.33% 79,898 1.48%
Stock index (18,526) (0.38)% 109,027 2.02%
------------ ------------ ------------ ------------
Total long futures contracts $ 184,575 3.81% $283,384 5.25%
------------ ------------ ------------ ------------
SHORT FUTURES CONTRACTS
Agricultural $(90) (0.00)% $(3,432) (0.06)%
Currency 69,185 1.42% (7,103) (0.13)%
Energy 0 0.00% 4,172 0.08%
Interest rate 55,765 1.15% 5,307 0.10%
Metal (36,423) (0.75)% (68,265) (1.27)%
Stock index (531) (0.01)% 0 0.00%
------------ ------------ ------------ ------------
Total short futures contracts $ 87,906 1.81% $(69,321) (1.28)%
------------ ------------ ------------ ------------
Total futures contracts $ 272,481 5.62% $214,063 3.97%
============ ============ ============ ============
WRITTEN OPTIONS ON FUTURES CONTRACTS
Currency $ 0 0.00% $(125) 0.00%
------------ ------------ ------------ ------------
Total written options on futures contracts
(premiums received - $0 and $2,250) $ 0 0.00% $(125) 0.00%
============ ============ ============ ============
See accompanying notes.
ALTERNATIVE ASSET GROWTH FUND, L.P.
STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2005 and 2004 (Unaudited)
Three Months Ended
March 31,
2005 2004
---------------- ----------------
TRADING GAINS (LOSSES)
Gain (loss) from futures and option trading
Realized $ (56,113) $ 1,183,329
Change in unrealized 56,293 (168,335)
Brokerage commissions (32,415) (45,815)
---------------- ----------------
Gain (loss) from futures and option trading (32,235) 969,179
---------------- ----------------
Gain (loss) from forward currency trading
Realized 0 27,142
Change in unrealized 0 (17,371)
---------------- ----------------
Gain from forward currency trading 0 9,771
---------------- ----------------
Total trading gains (losses) (32,235) 978,950
---------------- ----------------
NET INVESTMENT INCOME (LOSS)
Income
Interest income 29,226 14,036
---------------- ----------------
Expenses
Incentive fees 35,194 196,654
Management fees 92,003 112,676
Operating expenses 44,433 40,232
---------------- ----------------
Total expenses 171,630 349,562
---------------- ----------------
Net investment (loss) (142,404) (335,526)
---------------- ----------------
NET INCOME (LOSS) $ (174,639) $ 643,424
================ ================
NET INCOME (LOSS) PER GENERAL AND
LIMITED PARTNER UNIT
(based on weighted average number of
units outstanding during the period of
3,837 and 4,375, respectively) $ (45.51) $ 147.08
================ ================
INCREASE (DECREASE) IN NET ASSET VALUE PER
GENERAL AND LIMITED PARTNER UNIT $ (43.79) $ 147.27
================ ================
See accompanying notes.
ALTERNATIVE ASSET GROWTH FUND, L.P.
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (NET ASSET VALUE)
For the Three Months Ended March 31, 2005 and 2004 (Unaudited)
Total Partners' Capital
Number of -------------------------------------------------------------------
Units General Limited Total
------------------ ------------------- ------------------- -------------------
Balances at
December 31, 2004 3,930 $ 139,224 $ 5,255,409 $ 5,394,633
Net (loss) for the three months ended
March 31, 2005 (4,442) (170,197) (174,639)
Redemptions (279) 0 (368,023) (368,023)
------------------ ------------------- ------------------- -------------------
Balances at
March 31, 2005 3,651 $ 134,782 $ 4,717,189 $ 4,851,971
================== =================== =================== ===================
Balances at
December 31, 2003 4,441 $ 137,933 $ 5,901,730 $ 6,039,663
Net income for the three months ended
March 31, 2004 14,936 628,488 643,424
Redemptions (227) 0 (331,018) (331,018)
------------------ ------------------- ------------------- -------------------
Balances at
March 31, 2004 4,214 $ 152,869 $ 6,199,200 $ 6,352,069
================== =================== =================== ===================
Net Asset Value Per Unit
March 31, December 31, March 31, December 31,
2005 2004 2004 2003
------------------ ------------------- ------------------- -------------------
$ 1,328.90 $ 1,372.69 $ 1,507.23 $ 1,359.96
================== =================== =================== ===================
See accompanying notes.
ALTERNATIVE ASSET GROWTH FUND, L.P.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
--------------
Note 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
-----------------------------------------------------------
A. General Description of the Partnership
Alternative Asset Growth Fund, L.P. (the Partnership) is a Delaware limited
partnership which operates as a commodity investment pool. The Partnership
engages in the speculative trading of futures contracts, options on futures
contracts and interbank forward currency contracts.
B. Regulation
As a registrant with the Securities and Exchange Commission, the Partnership
is subject to the regulatory requirements under the Securities Act of 1933 and
the
Securities Exchange Act of 1934. As a commodity investment pool, the
Partnership is subject to the regulations of the Commodity Futures Trading
Commission, an agency of the United States (U.S.) government which regulates
most aspects of the commodity futures industry; rules of the National Futures
Association, an industry self-regulatory organization; and the requirements of
commodity exchanges, Futures Commission Merchants (brokers) and interbank
market makers through which the Partnership trades.
C. Method of Reporting
The Partnership's financial statements are presented in accordance with
accounting principles generally accepted in the United States of America,
which require the use of certain estimates made by the Partnership's
management. Transactions are accounted for on the trade date. Gains or losses
are realized when contracts are liquidated. Unrealized gains or losses on open
contracts (the difference between contract trade price and market price) are
reflected in the statement of financial condition as a net gain or loss, as
there exists a right of offset of unrealized gains or losses in accordance
with Financial Accounting Standards Board Interpretation No. 39 - "Offsetting
of Amounts Related to Certain Contracts." Any change in net unrealized gain or
loss from the preceding period is reported in the statement of operations.
For purposes of both financial reporting and calculation of redemption value,
Net Asset Value per Unit is calculated by dividing Net Asset Value by the
total number of units outstanding.
D. Brokerage Commissions
Brokerage commissions include other trading fees and are charged to expense
when contracts are opened.
E. Income Taxes
The Partnership prepares calendar year U.S. and applicable state information
tax returns and reports to the partners their allocable shares of the
Partnership's income, expenses and trading gains or losses.
F. Foreign Currency Transactions
The Partnership's functional currency is the U.S. dollar; however, it
transacts business in currencies other than the U.S. dollar. Assets and
liabilities denominated in currencies other than the U.S. dollar are
translated into U.S. dollars at the rates in effect at the date of the
statement of financial condition. Income and expense items denominated in
currencies other than the U.S. dollar are translated into U.S. dollars at the
rates in effect during the period. Gains and
losses resulting from the translation to U.S. dollars are reported in income
currently.
G. Statements of Cash Flows
The Partnership has elected not to provide statements of cash flows as
permitted by Statement of Financial Accounting Standards No. 102 - "Statement
of Cash Flows - Exemption of Certain Enterprises and Classification of Cash
Flows from Certain Securities Acquired for Resale."
H. Interim Financial Statements
In the opinion of management, the unaudited interim financial statements
reflect all adjustments, which were of a normal and recurring nature,
necessary for a fair presentation of financial position as of March 31, 2005,
and the results of operations for the three months ended March 31, 2005 and
2004.
Note 2. GENERAL PARTNER
---------------
The General Partner of the Partnership is ProFutures, Inc., which conducts and
manages the business of the Partnership. The Agreement of Limited Partnership
requires the General Partner to contribute to the Partnership an amount equal
to at least the greater of (i) 3% of aggregate capital contributions of all
partners or $100,000, whichever is less, or (ii) the lesser of 1% of the
aggregate capital contributions of all partners or $500,000.
The Agreement of Limited Partnership also requires that the General Partner
maintain a net worth at least equal to the sum of (i) the lesser of $250,000
or 15% of the aggregate capital contributions of any limited partnerships for
which it acts as general partner and which are capitalized at less than
$2,500,000; and (ii) 10% of the aggregate capital contributions of any limited
partnerships for which it acts as general partner and which are capitalized at
greater than $2,500,000.
Effective October 22, 2004, ProFutures, Inc. has a callable stock subscription
agreement with Man Financial Inc. (MFI), the Partnership's broker, whereby MFI
has subscribed to purchase (up to $7,000,000, subject to conditions set forth
in the stock subscription agreement dated October 22, 2004) the number of
shares of common stock of ProFutures, Inc. necessary to maintain the General
Partner's net worth requirements. Prior to October 22, 2004, ProFutures, Inc.
had a callable stock subscription agreement with ABN AMRO Incorporated (ABN),
the Partnership's prior broker, whereby ABN had subscribed to purchase (up to
$7,000,000, subject to the conditions set forth in the stock subscription
agreement as amended effective May 20, 2002) the number of shares of common
stock of ProFutures, Inc. necessary to maintain the General Partner's net
worth requirements.
The Partnership pays the General Partner a monthly management fee of 1/6 of 1%
(2% annually) of month-end Net Asset Value. Effective October 16, 2004, the
Partnership pays the General Partner an additional monthly management fee of
..0625% (.75% annually) of the Partnership's month-end Net Asset Value for
consulting services rendered to the Partnership.
Total management fees earned by ProFutures, Inc. for the three months ended
March 31, 2005 and 2004 were $34,952 and $32,102, respectively. Management
fees payable to ProFutures, Inc. as of March 31, 2005 and December 31, 2004
were $11,433 and $12,483, respectively.
Note 3. COMMODITY TRADING ADVISORS
--------------------------
The Partnership has trading advisory contracts with several commodity trading
advisors to furnish investment management services to the Partnership. The
trading advisors receive management fees ranging from 1% to 2% annually of
Allocated Net Asset Value (as defined in each respective trading advisory
contract). In addition, the trading advisors receive quarterly incentive fees
ranging from 20% to 25% of Trading Profits (as defined). Total management fees
earned by the trading advisors amounted to $28,453 and $32,421 for the three
months ended March 31, 2005 and 2004, respectively.
Note 4. OTHER MANAGEMENT FEES
---------------------
The Partnership employs a consultant who is paid a monthly fee of 1/6 of 1%
(2% annually) of month-end Net Asset Value for administrative services
rendered to the Partnership. Total fees earned by this consultant for the
three months ended March 31, 2005 and 2004 were $25,420 and $32,102,
respectively.
On October 25, 2004, the Partnership entered into a consulting agreement
effective November 1, 2004, with Altegris Investments, Inc. (Altegris),
whereby Altegris will recommend the selection and termination of the
Partnership's trading advisors and the allocation and reallocation of the
Partnership's assets. Pursuant to the consulting agreement, Altegris receives
a monthly consulting fee equal to .0208% (.25% annually) of the Partnership's
month-end Net Asset Value. The consulting fee (included in management fees in
the statement of operations) earned by Altegris totaled $3,178 for the three
months ended March 31, 2005.
Prior to October 15, 2004, Kenmar Global Strategies Inc. (Kenmar) assisted the
General Partner in making decisions about which commodity trading advisors to
hire, the allocations among the advisors and the day-to-day monitoring and
risk management of the Partnership's trading activities. Kenmar received a
monthly management fee of 1/12 of 1% (1% annually) of month-end Net Asset
Value. Effective October 15, 2004, ProFutures, Inc. terminated the consulting
agreement between Kenmar and the Partnership. Accordingly, Kenmar was paid a
pro rated monthly management fee for the period October 1, 2004 through
October 15,
2004. Management fees earned by Kenmar totaled $16,051 for the three months
ended March 31, 2004.
Note 5. DEPOSITS WITH BROKER
--------------------
The Partnership deposits funds with MFI (ABN prior to October 2004) to act as
broker, subject to Commodity Futures Trading Commission regulations and
various exchange and broker requirements. Margin requirements are satisfied by
the deposit of cash with such broker. The Partnership earns interest income on
its assets deposited with the broker.
Note 6. DISTRIBUTIONS AND REDEMPTIONS
-----------------------------
The Partnership is not required to make distributions, but may do so at the
sole discretion of the General Partner. A Limited Partner may request and
receive redemption of units owned, subject to restrictions in the Agreement of
Limited Partnership.
Note 7. TRADING ACTIVITIES AND RELATED RISKS
------------------------------------
The Partnership engages in the speculative trading of U.S. and foreign futures
contracts, options on U.S. and foreign futures contracts and forward currency
contracts (collectively, "derivatives"). The Partnership is exposed to both
market risk, the risk arising from changes in the market value of the
contracts, and credit risk, the risk of failure by another party to perform
according to the terms of a contract.
Purchase and sale of futures and options on futures contracts requires margin
deposits with the broker. Additional deposits may be necessary for any loss on
contract value. The Commodity Exchange Act requires a broker to segregate all
customer transactions and assets from such broker's proprietary activities. A
customer's cash and other property (for example, U.S. Treasury bills)
deposited with a broker are considered commingled with all other customer
funds subject to the broker's segregation requirements. In the event of a
broker's insolvency, recovery may be limited to a pro rata share of segregated
funds available. It is possible that the recovered amount could be less than
total cash and other property deposited.
For derivatives, risks arise from changes in the market value of the
contracts. Theoretically, the Partnership is exposed to a market risk equal to
the notional contract value of futures and forward currency contracts
purchased and unlimited liability on such contracts sold short. As both a
buyer and seller of options, the Partnership pays or receives a premium at the
outset and then bears the risk of unfavorable changes in the price of the
contract underlying the option. Written options expose the Partnership to
potentially unlimited liability, and purchased options expose the Partnership
to a risk of loss limited to the premiums paid.
The Partnership has a portion of its assets on deposit with a financial
institution in connection with its trading of forward currency contracts and
its cash management activities. In the event of a financial institution's
insolvency, recovery of Partnership assets on deposit may be limited to
account insurance or other protection afforded such deposits. Since forward
currency contracts are traded in unregulated markets between principals, the
Partnership also assumes the risk of loss from counterparty nonperformance.
The General Partner has established procedures to actively monitor market risk
and minimize credit risk, although there can be no assurance that it will, in
fact, succeed in doing so. The General Partner's basic market risk control
procedures consist of continuously monitoring the trading activity of the
various commodity trading advisors, with the actual market risk controls being
applied by Altegris (Kenmar prior to October 15, 2004), as a consultant, and
the advisors themselves. The General Partner seeks to minimize credit risk
primarily by depositing and maintaining the Partnership's assets at financial
institutions and brokers which the General Partner believes to be
creditworthy. The Limited Partners bear the risk of loss only to the extent of
the market value of their respective investments and, in certain specific
circumstances, distributions and redemptions received.
Note 8. GUARANTEES
----------
In the normal course of business, the Partnership enters into contracts and
agreements that contain a variety of representations and warranties and which
provide general indemnifications. The Partnership's maximum exposure under
these arrangements is unknown, as this would involve future claims that may be
made against the Partnership that have not yet occurred. The Partnership
expects the risk of any future obligation under these indemnifications to be
remote.
Note 9. FINANCIAL HIGHLIGHTS
--------------------
The following information presents per unit operating performance data and
other supplemental financial data for the three months ended March 31, 2005
and 2004. This information has been derived from information presented in the
financial statements.
Three months ended
March 31,
2005 2004
(Unaudited) (Unaudited)
------------ ------------
Per Unit Performance
(for a unit outstanding throughout the entire period)
Net asset value per unit at beginning of period $1,372.69 $1,359.96
------------ ------------
Income (loss) from operations:
Total trading gains (losses) (1) (6.68) 223.97
Net investment (loss) (1) (37.11) (76.70)
------------ ------------
Total income (loss) from operations (43.79) 147.27
------------ ------------
Net asset value per unit at end of period $1,328.90 $1,507.23
============ ============
Total Return (3) (3.19)% 10.83%
============ ============
Supplemental Data
Ratios to average net asset value:
Expenses prior to incentive fees (4) 11.05% 9.73%
Incentive fees (3) 0.71% 3.13%
------------ ------------
Total expenses 11.76% 12.86%
============ ============
Net investment (loss) (2), (4) (8.68)% (8.84)%
============ ============
Total returns are calculated based on the change in value of a unit during the
period. An individual partner's total returns and ratios may vary from the
above total returns and ratios based on the timing of redemptions.
- ---------
(1) The net investment (loss) per unit is calculated by dividing the net
investment (loss) by the average number of units outstanding during the
period. Total trading gains (losses) is a balancing amount necessary to
reconcile the change in net asset value per unit with the other per unit
information. Such balancing amount may differ from the calculation of
total trading gains (losses) per unit due to the timing of trading gains
and losses during the period relative to the number of units outstanding.
(2) Excludes incentive fees.
(3) Not annualized.
(4) Annualized.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Reference is made to Item 1, "Financial Statements." The
information contained therein is essential to, and should be
read in connection with, the following analysis.
Critical Accounting Policies
- ----------------------------
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date
of the financial statements and the reported amounts of income and expense
during the reporting period. Management believes that the estimates utilized
in preparing the financial statements are reasonable and prudent; however,
actual results could differ from those estimates. The Partnership's
significant accounting policies are described in detail in Note 1 to the
Financial Statements.
The Partnership records all investments at fair value in its financial
statements, with changes in fair value reported as a component of realized and
change in unrealized trading gain (loss) in the Statements of Operations.
Generally, fair values are based on market prices; however, in certain
circumstances, estimates are involved in determining fair value in the absence
of an active market closing price (e.g., swap and forward contracts which are
traded in the inter-bank market).
A. LIQUIDITY: Substantially all of the Partnership's assets are highly liquid,
such as cash and open futures contracts. It is possible that extreme market
conditions or daily price fluctuation limits at certain exchanges could
adversely affect the liquidity of open futures contracts. There are no
restrictions on the liquidity of these assets except for amounts on deposit
with the brokers needed to meet margin requirements on open futures contracts.
B. CAPITAL RESOURCES: Since the Partnership's business is the purchase and
sale of various commodity interests, it will make few, if any, capital
expenditures.
The Partnership's offering of Units of Limited Partnership Interest terminated
in 1991.
C. RESULTS OF OPERATIONS: The Partnership's net income (loss) for the three
months ended March 31, 2005 and 2004 totaled $(174,639) and $643,424,
respectively.
As of March 31, 2005, 3,651 Units are outstanding, including 101 General
Partner Units, with an aggregate Net Asset Value of $4,851,971 ($1,328.90 per
Unit). This represents a decrease in Net Asset Value of $(542,662) compared
with December 31, 2004. The decrease is caused by redemptions of Units and a
net loss for the three months ended March 31, 2005.
As of March 31, 2004, 4,214 Units are outstanding, including 101 General
Partner Units, with an aggregate Net Asset Value of $6,352,069 ($1,507.23 per
Unit). This represents an increase in Net Asset Value of $312,406 compared
with December 31, 2003, due to net income for the three months ended March 31,
2004 exceeding redemptions of Units.
First Quarter 2005
- ------------------
The first quarter was an especially volatile one for oil prices and for
interest rates. Oil prices continue to climb, and then drop. Short-term
interest rates climbed as the Fed continued its policy of raising short-term
rates.
The Partnership had a loss of 4.78% in January. The Partnership had some
profits in interest rates and certain agricultural commodities. There were
large losses in foreign currencies, with smaller losses in stock indices,
metals and energy.
The Partnership had a gain of 1.20% in February. The Partnership had large
gains in stock indices, with smaller gains in short-term interest rates,
metals and energy. There were losses, mainly in bonds and agricultural
commodities.
The Partnership had a gain of gain of 0.46% in March. The Partnership had
large gains in energy, with other gains in interest rates, base metals and
certain agricultural commodities. Losses were in foreign currencies, stock
indices and certain other agricultural commodities.
The Partnership ended the quarter with a loss.
First Quarter 2004
- ------------------
The economy continued to improve in the first quarter of 2004, and most
economic news was positive. The futures markets continued to be volatile,
especially energy and currencies.
The Partnership had a gain of 0.76% in January 2004. There were gains in stock
indexes, metals and interest rates. There were small losses in energy,
agricultural commodities and foreign currencies.
The Partnership had a gain of 10.13% in February 2004. The largest gains were
in foreign currencies and interest rates, with smaller gains in energy,
agricultural commodities, metals and stock indexes.
The Partnership had a loss of 0.12% in March 2004. There were some gains in
interest rates and certain agricultural commodities. However, these were
mostly offset by losses in foreign currencies, equities and energy.
Overall, the Partnership ended the quarter with a total return of 10.83%. The
largest trading gains were in the interest rate and metals sectors.
Market and Credit Risk
- ----------------------
The General Partner, directly and/or indirectly through its consultant, has
established procedures to actively monitor market risk and minimize credit
risk, although there can be no assurance that it will, in fact, succeed in
doing so. The General Partner's basic market risk control procedures consist
of continuously monitoring the trading activity of the various trading
advisors, with the actual market risk controls being applied by the advisors
themselves. The General Partner seeks to minimize credit risk primarily by
depositing and maintaining the Partnership's assets at financial institutions
and brokers which the General Partner believes to be creditworthy. The Limited
Partners bear the risk of loss only to the extent of the market value of their
respective investments and, in certain specific circumstances, distributions
and redemptions received.
Due to the speculative nature of trading commodity interests, the
Partnership's income or loss from operations may vary widely from period to
period. Management cannot predict whether the Partnership's future Net Asset
Value per Unit will increase or experience a decline.
PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
D. POSSIBLE CHANGES: The General Partner reserves the right to terminate
certain and/or engage additional commodity trading advisors in the future and
reserves the right to change any of the Partnership's clearing arrangements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not Applicable.
Item 4. Controls and Procedures
ProFutures, Inc., as General Partner of Alternative Asset Growth
Fund, L.P., with the participation of the General Partner's President
and Chief Financial Officer, has evaluated the effectiveness of the
design and operation of its disclosure controls and procedures (as
defined in the Securities Exchange Act of 1934 Rules 13a-15(e) or
15d-15(e)) with respect to the Partnership as of the end of the
period covered by this quarterly report. Based on their evaluation,
the President and Chief Financial Officer have concluded that these
disclosure controls and procedures are effective. There were no
changes in the General Partner's internal control over financial
reporting applicable to the Partnership identified in connection with
the evaluation required by paragraph (d) of Exchange Act Rules 13a-15
or 15d-15 that occurred during the last fiscal quarter that have
materially affected, or are reasonably likely to materially affect,
internal control over financial reporting applicable to the
Partnership.
PART II- OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
(c) Pursuant to the Partnership's Agreement of Limited Partnership,
partners may redeem their Limited Partnership Units at the end of
each calendar month at the then current Net Asset Value per Unit. The
redemption of Units has no impact on the value of Units that remain
outstanding, and Units are not reissued once redeemed.
The following table summarizes the redemptions by partners during the
three months ended March 31, 2005:
MONTH UNITS REDEEMED NAV PER UNIT
----- -------------- ------------
January 31, 2005 86.858 1,307.14
February 28, 2005 104.913 1,322.84
March 31, 2005 87.067 1,328.90
---------
TOTAL 278.838
=========
Item 3. Defaults Upon Senior Securities.
Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits.
Exhibits filed herewith:
31.01 Certification of Gary D. Halbert, President, pursuant to
Rules 13a-14 and 15d-14 of the Securities Exchange Act of
1934.
31.02 Certification of Debi B. Halbert, Chief Financial Officer,
pursuant to Rules 13a-14 and 15d-14 of the Securities
Exchange Act of 1934.
32.01 Certification of Gary D. Halbert, President, pursuant to 18
U.S.C. Section 1350 as enacted by Section 906 of The
Sarbanes- Oxley Act of 2002.
32.02 Certification of Debi B. Halbert, Chief Financial Officer,
pursuant to 18 U.S.C. Section 1350 as enacted by Section 906
of The Sarbanes-Oxley Act of 2002.
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.
ALTERNATIVE ASSET GROWTH FUND, L.P.
(Registrant)
May 13, 2005 By /s/ GARY D. HALBERT
- ------------ ---------------------------------------------
Date Gary D. Halbert, President and Director
ProFutures, Inc.
General Partner
May 13, 2005 By /s/ DEBI B. HALBERT
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Date Debi B. Halbert, Chief Financial Officer,
Treasurer and Director
ProFutures, Inc.
General Partner