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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
|X| Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 [No Fee Required] For the year ended December 31, 1998 or
|_| Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 [No Fee Required] For the transition period from
________________to___________________ Commission File Number 0-19511
DEAN WITTER SPECTRUM SELECT L.P.
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(Exact name of registrant as specified in its Limited Partnership Agreement)
DELAWARE 13-3619290
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
c/o Demeter Management Corporation
Two World Trade Center, - 62nd Flr., New York, N.Y. 10048
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 392-5454
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
None None
- ---------------------- -----------------------
Securities registered pursuant to Section 12(g) of the Act:
Units of Limited Partnership Interest
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(Title of Class)
Indicate by check-mark 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 X No___
Indicate by check-mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K (section 229.405 of this chapter) is not contained
herein, and will not be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by reference in Part III
of this Form 10-K or any amendment of this Form 10-K. [X]
State the aggregate market value of the Units of Limited Partnership
Interest held by non-affiliates of the registrant. The aggregate market value
shall be computed by reference to the price at which units were sold as of a
specified date within 60 days prior to the date of filing: $191,228,087.08 at
January 31, 1999.
DOCUMENTS INCORPORATED BY REFERENCE
(See Page 1)
DEAN WITTER SPECTRUM SELECT L.P.
INDEX TO ANNUAL REPORT ON FORM 10-K
DECEMBER 31, 1998
Page No.
DOCUMENTS INCORPORATED BY REFERENCE. . . . . . . . . . . . . . . . . 1
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Part I .
Item 1. Business. . . . . . . . . . . . . . . . . . . . . . 2-5
Item 2. Properties. . . . . . . . . . . . . . . . . . . . . 5
Item 3. Legal Proceedings. . . . . . . . . . . . . . . . . . 4-6
Item 4. Submission of Matters to a Vote of Security Holders . 6
Part II.
Item 5. Market for the Registrant's Partnership Units
and Related Security Holder Matters .. . . . . . . 7-8
Item 6. Selected Financial Data . . . . . . . . . . . . . . 9
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations. . . . . . . . . 10-19
Item 7A. Quantitative and Qualitative Disclosure About
Market Risk . . . . . . . . . . . . . . . . . . . . 19-32
Item 8. Financial Statements and Supplementary Data. . . . . 32
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure. . . . . . . . . . 32
Part III.
Item 10. Directors and Executive Officers of the Registrant . 3-37
Item 11. Executive Compensation . . . . . . . . . . . . . . 37
Item 12. Security Ownership of Certain Beneficial Owners
and Management . . . . . . . . . . . . . . . . . . . 38
Item 13. Certain Relationships and Related Transactions . . . 38
Part IV.
Item 14. Exhibits, Financial Statement Schedules, and
Reports on Form 8-K . . . . . . . . . . . . . . . . 39
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DOCUMENTS INCORPORATED BY REFERENCE
-----------------------------------
Portions of the following documents are incorporated by reference as follows:
Documents Incorporated Part of Form 10-K
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Partnership's Prospectus dated
January 21, 1999 I
Annual Report to Dean Witter Spectrum
Series Limited Partners for the
year ended December 31, 1998 II, III and IV
PART I
Item 1. BUSINESS
(a) General Development of Business. Dean Witter Spectrum Select L.P.
(formerly, Dean Witter Select Futures Fund L.P.) (the "Partnership") is a
Delaware limited partnership organized to engage in the speculative trading of
commodity futures contracts and other commodity interests, including, but not
limited to, forward contracts on foreign currencies and options on futures
contracts and physical commodities (collectively, "futures interests").
Effective May 31, 1998, the Partnership became one of the Dean Witter Spectrum
Series of funds, comprised of the Partnership, Dean Witter Spectrum Global
Balanced L.P., Dean Witter Spectrum Strategic L.P. and Dean Witter Spectrum
Technical L.P. The general partner 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. ("MSDW"). The
trading advisors to the Partnership are EMC Capital Management, Inc., Rabar
Market Research, Inc. and Sunrise Capital Management, Inc. (collectively, the
"Trading Advisors").
- 2 -
The Partnership registered 1,500,000 Units of Limited Partnership
Interest ("Units") pursuant to a Registration Statement on Form S-1, which
became effective on May 11, 1998 (SEC File Number 333-47829). At the April 30,
1998 month-end close, each outstanding Unit was converted into 100 Units. Units
outstanding and Net Asset Value per unit have been adjusted for all reporting
periods to reflect this conversion. Commencing with the May 31, 1998 monthly
closing, Units are offered at monthly closings at a price equal to 100% of the
Net Asset Value per Unit as of the close of business on the last day of each
month.
5,000,000 additional Units were registered pursuant to a Registration
Statement on Form S-1 (File No. 333-68773), which became effective January 21,
1999.
The Partnership's Net Asset Value per Unit as of December 31, 1998 was
$23.80, representing an increase of 14.14 percent from the Net Asset Value per
Unit of $20.85 (on a post-conversion basis) at December 31, 1997. For a more
detailed description of the Partnership's business, see subparagraph (c).
(b) Financial Information about Industry Segments. For financial
information reporting purposes, the Partnership is deemed to engage in one
industry segment, the speculative trading of futures interests. The relevant
financial information is presented in Items 6 and 8.
- 3 -
(c) Narrative Description of Business. The Partnership is in the
business of speculative trading of futures interests, pursuant to trading
instructions provided by the Trading Advisors. For a detailed description of the
different facets of the Partnership's business, see those portions of the
Partnership's prospectus, dated January 21, 1999 (the "Prospectus"),
incorporated by reference in this Form 10-K, set forth below.
Facets of Business
1. Summary 1. "Summary of the Prospectus"
(Pages 1-6 of the Prospectus).
2. Futures, Options and 2. "The Futures, Options and
Forward Markets" Forward Markets
(Pages 83-87 of the Prospectus).
3. Partnership's Trading 3. "Investment Programs, Use
Arrangements and of Proceeds and Trading
Policies Policies" (Pages 20-25
of the Prospectus). "The
Trading Advisors"
(Pages 49-79 of the
Prospectus).
4. Management of the Part- 4. "The Trading Advisors -
nership The Management Agree-
ments" (Page 49 of the
Prospectus). "The
General Partner"
(Pages 47-48 of the
Prospectus), "The
Commodity Brokers"
(Page 82 of the Prospectus)
and "TheLimited Partnership
Agreements" (Pages 87-
91 of the Prospectus).
- 4 -
5. Taxation of the Partner- 5. "Material Federal Income
ship's Limited Partners Tax Considerations" and
"State and Local Income Tax
Aspects" (Pages 96-102
of the Prospectus).
(d) Financial Information About Foreign and Domestic Operations and
Export Sales.
The Partnership has not engaged in any operations in foreign countries;
however, the Partnership (through the commodity brokers) enters into forward
contract transactions where foreign banks are the contracting party and trades
in futures interests on foreign exchanges.
Item 2. PROPERTIES
The executive and administrative offices are located within the offices
of DWR. The DWR offices utilized by the Partnership are located at Two World
Trade Center, 62nd Floor, New York, NY 10048.
Item 3. LEGAL PROCEEDINGS
On September 6, 10, and 20, 1996, and on March 13, 1997, similar
purported class actions were filed in the Superior Court of the State of
California, County of Los Angeles, on behalf of all purchasers of interests in
limited partnership commodity pools sold by DWR. Named defendants include DWR,
Demeter, Dean Witter Futures & Currency Management Inc. ("DWFCM"), MSDW (all
such parties referred to hereafter as the "Dean Witter Parties"), the
Partnership (under its original name), certain other limited partnership
commodity pools of which Demeter is the general partner, and certain trading
advisors to those pools. On June
- 5 -
16, 1997. the plaintiffs in the above actions filed a consolidated amended
complaint, alleging, among other things, that the defendants committed fraud,
deceit, negligent misrepresentation, various violations of the California
Corporations Code, intentional and negligent breach of fiduciary duty,
fraudulent and unfair business practices, unjust enrichment, and conversion in
the sale and operation of the various limited partnership commodity pools.
Similar purported class actions were also filed on September 18 and 20, 1996, in
the Supreme Court of the State of New York, New York County, and on November 14,
1996 in the Superior Court of the State of Delaware, New Castle County, against
the Dean Witter Parties and certain trading advisors on behalf of all purchasers
of interests in various limited partnership commodity pools, including the
Partnership, sold by DWR. A consolidated and amended complaint in the action
pending in the Supreme Court of the State of New York was filed on August 13,
1997, alleging that the defendants committed fraud, breach of fiduciary duty,
and negligent misrepresentation in the sale and operation of the various limited
partnership commodity pools. On December 16, 1997, upon motion of the
plaintiffs, the action pending in the Superior Court of the State of Delaware
was voluntarily dismissed without prejudice. The New York Supreme Court
dismissed the New York action in November 1998, but granted plaintiffs leave to
file an amended complaint, which they did in early December 1998. The defendants
have filed a motion to dismiss the
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amended complaint with prejudice on February 1, 1999. The complaints seek
unspecified amounts of compensatory and punitive damages and other relief. It is
possible that additional similar actions may be filed and that, in the course of
these actions, other parties could be added as defendants. The Dean Witter
Parties believe that they and the Partnership have strong defenses to, and they
will vigorously contest, the actions. Although the ultimate outcome of legal
proceedings cannot be predicted with certainty, it is the opinion of management
of the Dean Witter Parties that the resolution of the actions will not have a
material adverse effect on the financial condition or the results of operations
of any of the Dean Witter Parties or the Partnership.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
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PART II
Item 5. MARKET FOR THE REGISTRANT'S PARTNERSHIP UNITS AND RELATED
SECURITY HOLDER MATTERS
There is no established public trading market for Units of the
Partnership. The number of holders of Units at December 31, 1998 was
approximately 12,446. No distributions have been made by the Partnership since
it commenced trading operations on August 1, 1991. Demeter has sole discretion
to decide what distributions, if any, shall be made to investors in the
Partnership. No determination has yet been made as to future distributions.
The Partnership registered additional 1,500,000 Units pursuant to
Registration Statement on Form S-1, which became effective on May 11, 1998 (SEC
File Number 333-47829). At the April 30, 1998 month-end close, each outstanding
Unit was converted into 100 Units. Commencing with the May 31, 1998 monthly
closing, Units are sold at monthly closings as of the last day of each month at
a price equal to 100% of the Net Asset Value per Unit as of the date of such
monthly closing.
Through December 31, 1998, 15,924,320.829 Units have been sold, leaving
189,646.271 Units unsold as of December 31, 1998. The aggregate price of the
Units sold through December 31, 1998 is $229,492,264.
- 8 -
Since no expenses are chargeable against proceeds, 100% of the proceeds
of the offering have been applied to the working capital of the Partnership for
use in accordance with the "Investment Programs, Use of Proceeds and Trading
Policies" section of the Prospectus.
- 9 -
Item 6. SELECTED FINANCIAL DATA (in dollars)
For the Years Ended December 31,
--------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- ---------
Total Revenues
(including
interest) 41,778,732 26,495,529 22,046,523 69,299,562 17,420,402
Net Income
(Loss) 22,695,060 9,943,717 5,414,041 39,054,115 (9,802,907)
Net Income
(Loss) Per
Unit (Limited
& General
Partners) 2.95 1.22 .98 3.56 (.81)
Total Assets 202,668,038 169,541,807 167,588,012 179,342,999 171,613,080
Total Limited
Partners'
Capital 196,915,644 163,999,307 161,174,820 173,965,425 166,182,436
Net Asset Value
Per Unit of
Limited Partner-
ship Interest 23.80 20.85 19.62 18.64 15.08
Note: Net Income (Loss) per Unit and Net Asset Value per Unit of Limited
Partnership Interest have been restated for all periods to reflect the
one to 100 Unit conversion.
- 10 -
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Liquidity - Assets of the Partnership are deposited with DWR as
non-clearing broker and Carr as clearing broker in separate futures interest
trading accounts. Such assets are held in either non-interest bearing bank
accounts or in securities approved by the Commodity Futures Trading Commission
("CFTC") for investment of customer funds. The Partnership's assets held by DWR
and Carr may be used as margin solely for the Partnership's trading. Since the
Partnership's sole purpose is to trade in futures interests, it is expected that
the Partnership will continue to own such liquid assets for margin purposes.
The Partnership's investment in futures interests may, from time to
time, be illiquid. Most United States futures exchanges limit fluctuations in
certain futures interest prices during a single day by regulations referred to
as "daily price fluctuations limits" or "daily limits". Pursuant to such
regulations, during a single trading day no trades may be executed at prices
beyond the daily limit. If the price for a particular futures interest has
increased or decreased by an amount equal to the daily limit, positions in such
futures interest can neither be taken nor liquidated unless traders are willing
to effect trades at or
- 11 -
within the limit. Futures interest 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 futures
interests and result in restrictions on redemptions.
There is no limitation on daily price moves in trading forward
contracts on foreign currency. The markets for some world currencies have low
trading volume and are illiquid, which may prevent the Partnership from trading
in potentially profitable markets or from promptly liquidating unfavorable
positions, subjecting it to substantial losses. Either of these market
conditions could result in restrictions on redemptions.
Capital Resources. The Partnership does not have, nor does it expect to
have, any capital assets. Future redemptions, exchanges and sales of additional
Units will affect the amount of funds available for investment in futures
interests in subsequent periods. Since they are at the discretion of Limited
Partners, it is not possible to estimate the amount and therefore, the impact of
future redemptions, exchanges or sales of additional Units.
Results of Operations. As of December 31, 1998, the Partnership's total
capital was $200,082,516, an increase of $33,309,195 from the Partnership's
total capital of $166,773,321 at December 31, 1997. For the year ended December
31, 1998, the Partnership generated net income of
- 12 -
$22,695,060, total subscriptions aggregated $30,297,590 and total redemptions
aggregated $19,683,455.
For the year ended December 31, 1998, the Partnership's total trading
revenues, including interest income, were $41,778,732. The Partnership's total
expenses for the year were $19,083,672, resulting in net income of $22,695,060.
The value of an individual unit in the Partnership increased from $20.85 at
December 31, 1997 to $23.80 at December 31, 1998.
As of December 31, 1997, the Partnership's total capital was
$166,773,321, an increase of $2,987,036 from the Partnership's total capital of
$163,786,285, at December 31, 1996. For the year ended December 31, 1997, the
Partnership generated net income of $9,943,717, total subscriptions aggregated
$12,056,614 and total redemptions aggregated $19,013,295.
For the year ended December 31, 1997, the Partnership's total trading
revenues including interest income were $26,495,529. The Partnership's total
expenses for the year were $16,551,812, resulting in net income of $9,943,717.
The value of an individual unit in the Partnership increased from $19.62 at
December 31, 1996 to $20.85 at December 31, 1997.
As of December 31, 1996, the Partnership's total capital was
$163,786,285, a decrease of $12,659,975 from the Partnership's total capital of
$176,446,260 at December 31, 1995. For the year ended
- 13 -
December 31, 1996, the Partnership generated net income of $5,414,041, total
subscriptions aggregated $10,251,712 and total redemptions aggregated
$28,325,728.
For the year ended December 31, 1996, the Partnership's total trading
revenues including interest income were $22,046,523. The Partnership's expenses
for the year were $16,632,482, resulting in net income of $5,414,041. The value
of an individual unit in the Partnership increased from $18.64 at December 31,
1995 to $19.62 at December 31, 1996. Note: All periods prior to May 31, 1998
have been restated to reflect the one to 100 Unit conversion.
The Partnership's overall performance record represents varied results
of trading in different futures interests markets. For a further description of
1998 trading results, refer to the letter to the Limited Partners in the
accompanying Annual Report to Limited Partners for the year ended December 31,
1998, incorporated by reference in this Form 10-K. The Partnership's gains and
losses are allocated among its partners for income tax purposes.
Credit Risk. In entering into futures and forward contracts there is a
credit risk to the Partnership that the counterparty on a contract will not be
able to meet its obligations to the Partnership. The ultimate counterparty of
the Partnership for futures contracts traded in the United States and most
foreign exchanges on which the Partnership
- 14 -
trades is the clearinghouse associated with such exchange. In general, a
clearinghouse is backed by the membership of the exchange and will act in the
event of non-performance by one of its members or one of its member's customers,
and, as such, should significantly reduce this credit risk. For example, a
clearinghouse may cover a default by (i) drawing upon a defaulting member's
mandatory contributions and/or non-defaulting members' contributions to a
clearinghouse guarantee fund, established lines or letters of credit with banks,
and/or the clearinghouse's surplus capital and other available assets of the
exchange and clearinghouse, or (ii) assessing its members.
In cases where the Partnership trades on a foreign exchange where the
clearinghouse is not funded or guaranteed by the membership or where the
exchange is a "principals' market" in which performance is the responsibility of
the exchange member and not the exchange or a clearinghouse, or when the
Partnership enters into off-exchange contracts with a counterparty, the sole
recourse of the Partnership will be the clearinghouse, the exchange member or
the off-exchange contract counterparty, as the case may be. There can be no
assurance that a clearinghouse, exchange or other exchange member will meet its
obligations to the Partnership, and the Partnership is not indemnified against a
default by such parties from Demeter, MSDW or DWR.
- 15 -
Further, the law is unclear as to whether a commodity broker has any
obligation to protect its customers from loss in the event of an exchange,
clearinghouse or other exchange member default on trades effected for the
broker's customers. Any such obligation on the part of the broker appears even
less clear where the default occurs in a non-US jurisdiction.
Demeter deals with the credit risks of all partnerships for which it
serves as general partner in several ways. First, it monitors the Partnership's
credit exposure to each exchange on a daily basis, calculating not only the
amount of margin required for it but also the amount of its unrealized gains at
each exchange, if any. The commodity brokers inform the Partnership, as with all
their customers, of its net margin requirements for all its existing open
positions, but do not break that net figure down, exchange by exchange. Demeter,
however, has installed a system which permits it to monitor the Partnership's
potential margin liability, exchange by exchange. Demeter is then able to
monitor the Partnership's potential net credit exposure to each exchange by
adding the unrealized trading gains on that exchange, if any, to the
Partnership's margin liability thereon.
Second, the Partnership's trading policies limit the amount of its net
assets that can be committed at any given time to futures contracts and require,
in addition, a certain minimum amount of diversification in the Partnership's
trading, usually over several different products. One
- 16 -
of the aims of such trading policies has been to reduce the credit exposure of
the Partnership to a single exchange and, historically, the Partnership's
exposure has typically amounted to only a small percentage of its total net
assets. On those relatively few occasions where the Partnership's credit
exposure may climb above that level, Demeter deals with the situation on a case
by case basis, carefully weighing whether the increased level of credit exposure
remains appropriate.
Third, Demeter has secured, with respect to Carr acting as the clearing
broker for the Partnership, a guarantee by Credit Agricole Indosuez, Carr's
parent, of the payment of the "net liquidating value" of the transactions
(futures and forward contracts) in the Partnership's account.
With respect to forward contract trading, the Partnership trades with
only those counterparties which Demeter, together with DWR, have determined to
be creditworthy. At the date of this filing, the Partnership deals only with
Carr as its counterparty on forward contracts. The guarantee by Carr's parent,
discussed above, covers these forward contracts.
See "Financial Instruments" under Notes to Financial Statements in the
Partnership's Annual Report to Limited Partners for the year ended December 31,
1998, incorporated by reference in this Form 10-K.
- 17 -
Year 2000 Problem. Commodity pools, like financial and business
organizations and individuals around the world, depend on the smooth functioning
of computer systems. Many computer systems in use today cannot recognize the
computer code for the year 2000, but revert to 1900 or some other date. This is
commonly known as the "Year 2000 Problem". The Partnership could be adversely
affected if computer systems used by it or any third party with whom it has a
material relationship do not properly process and calculate date-related
information and data concerning dates on or after January 1, 2000. Such a
failure could adversely affect the handling or determination of futures trades
and prices and other services.
MSDW began its planning for the Year 2000 Problem in 1995, and
currently has several hundred employees working on the matter. It has developed
its own Year 2000 compliance plan to deal with the problem and had the plan
approved by the company's executive management, Board of Directors and
Information Technology Department. Demeter is coordinating with MSDW to address
the Year 2000 Problem with respect to Demeter's computer systems that affect the
Partnership. This includes hardware and software upgrades, systems consulting
and computer maintenance.
- 18 -
Beyond the challenge facing internal computer systems, the systems
failure of any of the third parties with whom the Partnership has a material
relationship - the futures exchanges and clearing organizations through which it
trades, Carr, or the Trading Advisors - could result in a material financial
risk to the Partnership. All U.S. futures exchanges are subject to monitoring by
the CFTC of their Year 2000 preparedness and the major foreign futures exchanges
are also expected to be subject to market-wide testing of their Year 2000
compliance during 1999. Demeter intends to monitor the progress of Carr and the
Trading Advisors throughout 1999 in their Year 2000 compliance and, where
applicable, to test its external interface with Carr and the Trading Advisors.
A worst case scenario would be one in which trading of contracts on
behalf of the Partnership becomes impossible as a result of the Year 2000
Problem encountered by any third parties. A less catastrophic, but more likely
scenario would be one in which trading opportunities diminish as a result of
technical problems, resulting in illiquidity and fewer opportunities to make
profitable trades. MSDW has begun developing various "contingency plans" in the
event that the systems of such third parties fail. Demeter intends to consult
closely with MSDW in implementing those plans. Despite the best efforts of both
Demeter and MSDW, however, it is possible that these steps will not be
sufficient to avoid any adverse impact to the Partnership.
- 19 -
Risks Associated With the Euro. On January 1, 1999, eleven countries in
the European Union established fixed conversion rates on their existing
sovereign currencies and converted to a common single currency (the "euro").
During a three-year transition period, the sovereign currencies will continue to
exist but only as a fixed denomination of the euro. Conversion to the euro
prevents the Trading Advisors from trading in certain currencies and thereby
limits their ability to take advantage of potential market opportunities that
might otherwise have existed had separate currencies been available to trade.
This could adversely affect the performance results of the Partnership.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Introduction
The Partnership is a commodity pool engaged primarily in the speculative trading
of futures interests. The market sensitive instruments held by the Partnership
are acquired solely for speculative trading purposes and, as a result, all or
substantially all of the Partnership's assets are subject to the risk of trading
loss. Unlike an operating company, the risk of market sensitive instruments is
integral, not incidental, to the Partnership's primary business activities.
The futures interests traded by the Partnership involve varying degrees of
related market risk. Such market risk is often dependent upon
- 20 -
changes in the level or volatility of interest rates, exchange rates, and/or
market values of financial instruments and commodities. Fluctuations in related
market risk based upon the aforementioned factors result in frequent changes in
the fair value of the Partnership's open positions, and, consequently, in its
earnings and cash flow.
The Partnership's total market risk is influenced by a wide variety of factors,
including the diversification effects among the Partnership's existing open
positions, the volatility present within the market(s) and the liquidity of the
market(s). At varying times, each of these factors may act to exacerbate or mute
the market risk associated with the Partnership.
The Partnership's past performance is not necessarily indicative of its future
results. Any attempt at quantifying the Partnership's market risk must be
qualified by the inherent uncertainty of its speculative trading, which may
cause future losses and volatility (i.e. "risk of ruin") far in excess of the
Partnership's experience to date and/or any reasonable expectation premised upon
historical changes in the fair value of its market sensitive instruments.
- 21 -
Quantifying the Partnership's Trading Value at Risk
The following quantitative disclosures regarding the Partnership's market risk
exposures contain "forward-looking statements" within the meaning of the safe
harbor from civil liability provided for such statements by the Private
Securities Litigation Reform Act of 1995 (set forth in Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934).
All quantitative disclosures in this section are deemed to be forward-looking
statements for purposes of the safe harbor, except for statements of historical
fact.
The Partnership accounts for open positions on the basis of mark-to-market
accounting principles. As such, any loss in the fair value of the Partnership's
open positions is directly reflected in the Partnership's earnings, whether
realized or unrealized, and the Partnership's cash flow, as profits and losses
on open positions of exchange traded-futures interests are settled daily through
variation margin.
The Partnership's risk exposure in the various market sectors traded by the
Trading Advisors is estimated below in terms of Value at Risk ("VaR"). The VaR
model employed by the Partnership incorporates numerous variables that could
impact the fair value of the Partnership's trading portfolio. The Partnership
estimates VaR using a model based on historical simulation with a confidence
level of 99%. Historical
- 22 -
simulation involves constructing a distribution of hypothetical daily changes in
trading portfolio value. The VaR model generally takes into account linear
exposures to price and interest rate risk. Market risks that are incorporated in
the VaR model include equity and commodity prices, interest rates, foreign
exchange rates, as well as correlation that exists among these variables. The
hypothetical changes in portfolio value are based on daily observed percentage
changes in key market indices or other market factors ("market risk factors") to
which the portfolio is sensitive. In the case of the Partnership's VaR, the
historical observation period is approximately four years. The Partnership's
one-day 99% VaR corresponds to the negative change in portfolio value that,
based on observed market risk factor moves, would have been exceeded once in 100
trading days.
VaR models such as the Partnership's are continually evolving as trading
portfolios become more diverse and modeling techniques and systems capabilities
improve. It must also be noted that the VaR model is used to quantify market
risk for historic reporting purposes only and is not utilized by either Demeter
or the Trading Advisors in their daily risk management activities.
- 23 -
The Partnership's Value at Risk in Different Market Sectors
The following table indicates the VaR associated with the Partnership's open
positions as a percentage of total net assets by market category as of December
31, 1998. As of December 31, 1998, the Partnership's total capitalization was
approximately $200 million.
Primary Market December 31, 1998
Risk Category Value at Risk
Interest Rate (1.06)%
Currency (0.51)
Equity (0.37)
Commodity (0.91)
Aggregate Value at Risk (1.28)%
Aggregate value at risk represents the aggregate VaR of the Partnership's open
positions and not the sum of the VaR of the individual categories listed above.
Aggregate VaR will be lower as it takes into account correlation among different
positions and categories.
The table above represents the VaR of the Partnership's open positions at
December 31, 1998 only and is not necessarily representative of either the
historic or future risk of an investment in the Partnership. As the
Partnership's sole business is the speculative trading of primarily futures
interests, the composition of its portfolio of open positions can change
significantly over any given time period or even
- 24 -
within a single trading day. Such changes in open positions could materially
impact market risk as measured by VaR either positively or negatively.
The table below supplements the year end VaR by presenting the
Partnership's high, low and average VaR as a percentage of net assets for the
four quarterly reporting periods from January 1, 1998 through December 31, 1998.
Primary Market Risk Category High Low Average
Interest Rate (2.27)% (0.40)% (1.47)%
Currency (1.70) (0.51) (0.99)
Equity (0.85) (0.21) (0.45)
Commodity (0.92) (0.51) (0.79)
Aggregate Value at Risk (2.68)% (1.28)% (2.18)%
Limitations on Value at Risk as an Assessment of Market Risk
The face value of the market sector instruments held by the Partnership is
typically many times the applicable margin requirements, as such margin
requirements generally range between 2% and 15% of contract face value.
Additionally, due to the use of leverage, the face value of the market sector
instruments held by the Partnership is typically many times the total
capitalization of the Partnership. The financial magnitude of the Partnership's
open positions thus creates a "risk of
- 25 -
ruin" not typically found in other investment vehicles. Due to the relative size
of the positions held, certain market conditions may cause the Partnership to
incur losses greatly in excess of VaR within a short period of time. The
foregoing VaR tables, as well as the past performance of the Partnership, gives
no indication of such "risk of ruin". In addition, VaR risk measures should be
interpreted in light of the methodology's limitations, which include the
following: past changes in market risk factors will not always yield accurate
predictions of the distributions and correlations of future market movements;
changes in portfolio value in response to market movements may differ from the
responses implicit in a VaR model; published VaR results reflect past trading
positions while future risk depends on future positions; VaR using a one-day
time horizon does not fully capture the market risk of positions that cannot be
liquidated or hedged within one day; and the historical market risk factor data
used for VaR estimation may provide only limited insight into losses that could
be incurred under certain unusual market movements.
The foregoing VaR tables present the results of the Partnership's VaR for each
of the Partnership's market risk exposures and on an aggregate basis at December
31, 1998 and for the end of quarter periods during
- 26 -
calendar 1998. Since VaR is based on historical data, VaR should not be viewed
as predictive of the Partnership's future financial performance or its ability
to manage and monitor risk and there can be no assurance that the Partnership's
actual losses on a particular day will not exceed the VaR amounts indicated
below or that such losses will not occur more than 1 in 100 trading days.
Non-Trading Risk
The Partnership has non-trading market risk on its foreign cash balances not
needed for margin. However, such balances, as well as any market risk they may
represent, are immaterial. The Partnership also maintains a substantial portion
(approximately 87%) of its available assets in cash at DWR. A decline in
short-term interest rates will result in a decline in the Partnership's cash
management income. This cash flow risk is not considered material.
Materiality, as used throughout this section, is based on an assessment of
reasonably possible market movements and the potential losses caused by such
movements, taking into account the leverage, optionality and multiplier features
of the Partnership's market sensitive instruments.
- 27 -
Qualitative Disclosures Regarding Primary Trading Risk Exposures
The following qualitative disclosures regarding the Partnership's market risk
exposures - except for (i) those disclosures that are statements of historical
fact and (ii) the descriptions of how the Partnership manages its primary market
risk exposures - constitute forward-looking statements within the meaning of
Section 27A of the Securities Act and Section 21E of the Securities Exchange
Act. The Partnership's primary market risk exposures as well as the strategies
used and to be used by Demeter and the Trading Advisors for managing such
exposures are subject to numerous uncertainties, contingencies and risks, any
one of which could cause the actual results of the Partnership's risk controls
to differ materially from the objectives of such strategies. Government
interventions, defaults and expropriations, illiquid markets, the emergence of
dominant fundamental factors, political upheavals, changes in historical price
relationships, an influx of new market participants, increased regulation and
many other factors could result in material losses as well as in material
changes to the risk exposures and the risk management strategies of the
Partnership. Investors must be prepared to lose all or substantially all of
their investment in the Partnership.
The following were the primary trading risk exposures of the
Partnership as of December 31, 1998, by market sector. It may be anticipated
however, that these market exposures will vary materially over time.
- 28 -
Interest Rate. Interest rate risk is the principal market exposure of
the Partnership. Interest rate movements directly affect the price of the
sovereign bond futures positions held by the Partnership and indirectly the
value of its stock index and currency positions. Interest rate movements in one
country as well as relative interest rate movements between countries materially
impact the Partnership's profitability. The Partnership's primary interest rate
exposure is to interest rate fluctuations in the United States and the other G-7
countries. However, the Partnership also takes futures positions in the
government debt of smaller nations - e.g. Australia. Demeter anticipates that
G-7 interest rates will remain the primary market exposure of the Partnership
for the foreseeable future. The changes in interest rates which have the most
effect on the Partnership are changes in long-term, as opposed to short-term,
rates. Most of the speculative futures positions held by the Partnership are in
medium-to-long term instruments. Consequently, even a material change in
short-term rates would have little effect on the Partnership were the
medium-to-long term rates to remain steady.
Currency. The Partnership's currency exposure is to exchange rate
fluctuations, primarily fluctuations which disrupt the historical pricing
relationships between different currencies and currency pairs. These
fluctuations are influenced by interest rate changes as well as political and
general economic conditions. The Partnership trades in a
- 29 -
large number of currencies, including cross-rates - i.e., positions
between two currencies other than the U.S. dollar. However, the Partnership's
major exposures have typically been in the dollar/yen, dollar/mark and
dollar/pound positions. Demeter does not anticipate that the risk profile of the
Partnership's currency sector will change significantly in the future, although
it is difficult at this point to predict the effect of the introduction of the
Euro on the Trading Advisors' currency trading strategies.
Equity. The Partnership's primary equity exposure is to equity price
risk in the G-7 countries. The stock index futures traded by the Partnership are
by law limited to futures on broadly based indices. As of December 31, 1998, the
Partnership's primary exposures were in the S&P 500, Financial Times (England),
Nikkei (Japan) and DAX (Germany) stock indices. The General Partner anticipates
little, if any, trading in non-G-7 stock indices. The Partnership is primarily
exposed to the risk of adverse price trends or static markets in the major U.S.,
European and Japanese indices. (Static markets would not cause major market
changes but would make it difficult for the Partnership to avoid being
"whipsawed" into numerous small losses).
Commodity. Metals. The Partnership's primary metals market exposure is
to fluctuations in the price of gold and silver. Although certain of the Trading
Advisors will from time to time trade base metals such as
- 30 -
aluminum, copper, lead, tin, nickel and zinc, the principal market exposures of
the Partnership have consistently been in the precious metals, gold and silver.
The Trading Advisors' gold trading has been increasingly limited due to the
long-lasting and mainly non-volatile decline in the price of gold over the last
10-15 years. However, silver prices have remained volatile over this period, and
the Trading Advisors have from time to time taken substantial positions as they
have perceived market opportunities to develop. Demeter anticipates that gold
and silver will remain the primary metals market exposure for the Partnership.
Soft Commodities. One of the Partnership's primary commodities exposure
is to fluctuations in the price of soft commodities, which are often directly
affected by severe or unexpected weather conditions. Soybeans, grains, coffee,
cotton, orange juice, cocoa and sugar accounted for the substantial bulk of the
Partnership's commodities exposure as of December 31, 1998. The Partnership has
had market exposure to lean hogs.
Energy. The Partnership's primary energy market exposure is to gas and
oil price movements, often resulting from political developments in the Middle
East. Although the Trading Advisors trade natural gas to a limited extent, oil
is by far the dominant energy market exposure of the Partnership. Oil prices are
currently depressed, but they can be
- 31 -
volatile and substantial profits and losses have been and are expected to
continue to be experienced in this market.
Qualitative Disclosures Regarding Non-Trading Risk Exposure
The following was the only non-trading risk exposure of the Partnership as of
December 31, 1998:
Foreign Currency Balances. The Partnership's primary foreign currency balances
are in Japanese yen, German marks, British pounds, French francs and euros. The
Partnership controls the non-trading risk of these balances by regularly
converting these balances back into U.S. dollars at varying intervals, depending
upon such factors as size, volatility, etc.
Qualitative Disclosures Regarding Means of Managing Risk Exposure
The means by which the Partnership and the Trading Advisors, severally, attempt
to manage the risk of the Partnership's open positions are essentially the same
in all market categories traded. Demeter attempts to manage the Partnership's
market exposure by (i) diversifying the Partnership's assets among different
Trading Advisors, each of whose strategies focus on different market sectors and
trading approaches, and (ii), monitoring the performance of the Trading Advisors
on a daily
- 32 -
basis. In addition, the Trading Advisors establish diversification guidelines,
often set in terms of the maximum margin to be committed to positions in any one
market sector or market sensitive instrument. One should be aware that certain
Trading Advisors treat their risk control policies as strict rules, whereas
others treat such policies as general guidelines.
Demeter monitors and controls the risk of the Partnership's non-trading
instrument, cash, which is the only Partnership investment directed by Demeter,
rather than the Trading Advisors.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this Item appears in the Annual Report to
Limited Partners for the year ended December 31, 1998 and is incorporated by
reference in this Annual Report on Form 10-K.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
- 33-
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
There are no directors or executive officers of the Partnership. The Partnership
is managed by Demeter.
Directors and Officers of the General Partner
The directors and officers of Demeter are as follows:
Mark J. Hawley, age 55, is Chairman of the Board and a Director of
Demeter. Mr. Hawley is also Chairman of the Board and a Director of DWFCM. Mr.
Hawley previously served as President of Demeter throughout 1998. Mr. Hawley
joined DWR in February 1989 as Senior Vice President and is currently the
Executive Vice President and Director of DWR's Product Management for Individual
Asset Management. In this capacity, Mr. Hawley is responsible for directing the
activities of the firm's Managed Futures, Insurance, and Unit Investment Trust
Business. From 1978 to 1989, Mr. Hawley was a member of the senior management
team at Heinold Asset Management, Inc., a CPO, and was responsible for a variety
of projects in public futures funds. From 1972 to 1978, Mr. Hawley was a Vice
President in charge of institutional block trading for the Mid-West at Kuhn Loeb
& Company.
- 34 -
Joseph G. Siniscalchi, age 53, is a Director of Demeter. Mr.
Siniscalchi joined DWR in July 1984 as a First Vice President, Director of
General Accounting and served as a Senior Vice President and Controller for
DWR's Securities Division through 1997. He is currently Executive Vice President
and Director of the Operations Division of DWR. From February 1980 to July 1984,
Mr. Siniscalchi was Director of Internal Audit at Lehman Brothers Kuhn Loeb,
Inc.
Edward C. Oelsner, III, age 56, is a Director of Demeter. Mr. Oelsner
is currently an Executive Vice President and head of the Product Development
Group at Dean Witter InterCapital Inc., an affiliate of DWR. Mr. Oelsner joined
DWR in 1981 as a Managing Director in DWR's Investment Banking Department
specializing in coverage of regulated industries and, subsequently, served as
head of the DWR Retail Products Group. Prior to joining DWR, Mr. Oelsner held
positions at The First Boston Corporation as a member of the Research and
Investment Banking Departments from 1967 to 1981. Mr. Oelsner received his
M.B.A. in Finance from the Columbia University Graduate School of Business in
1966 and an A.B. in Politics from Princeton University in 1964.
Robert E. Murray, age 38, is President and a Director of Demeter. Mr.
Murray is also President and a Director of DWFCM. Effective as of the close of
December 31, 1998, Mr. Murray replaced Mr. Hawley as President of Demeter. Mr.
Murray is also a Senior Vice President of DWR's Managed Futures Department and
is the Senior Administrative
- 35 -
Officer of DWFCM. Mr. Murray began his career at DWR in 1984 and is currently
the Director of the Managed Futures Department. In this capacity, Mr. Murray is
responsible for overseeing all aspects of the firm's Managed Futures Department.
Mr. Murray currently serves as a Director of the Managed Funds Association, an
industry association for investment professionals in futures, hedge funds and
other alternative investments. Mr. Murray graduated from Geneseo State
University in May 1983 with a B.A. degree in Finance.
Lewis A. Raibley, III, age 36, is Vice President, Chief Financial
Officer and a Director of Demeter. Effective as of the close of business on
December 31, 1998, Mr. Raibley was elected to Demeter's Board of Directors. Mr.
Raibley is currently Senior Vice President and Controller in the Individual
Asset Management Group of MSDW. From July 1997 to May 1998, Mr. Raibley served
as Senior Vice President and Director in the Internal Reporting Department of
MSDW and prior to that, from 1992 to 1997, he served as Senior Vice President
and Director in the Financial Reporting and Policy Division of Dean Witter
Discover & Co. He has been with MSDW and its affiliates since June 1986.
Mitchell M. Merin, age 45, became a Director of Demeter on March 17,
1999. Mr. Merin was appointed the Chief Operating Officer of Asset Management
for MSDW in December 1998 and the President and Chief
- 36 -
Executive Officer of Morgan Stanley Dean Witter Advisors in February 1998. He
has been an Executive Vice President of DWR since 1990, during which time he has
been director of DWR's Taxable Fixed Income and Futures divisions, managing
director in Corporate Finance and corporate treasurer. Mr. Merin received his
Bachelor's degree from Trinity College in Connecticut and his M.B.A. degree in
finance and accounting from the Kellogg Graduate School of Management of
Northwestern University in 1977.
Richard A. Beech, age 47, became a Director of Demeter on March 17,
1999. Mr. Beech has been associated with the futures industry for over 23 years.
He has been at DWR since August 1984 where he is presently Senior Vice President
and head of Branch Futures. Mr. Beech began his career at the Chicago Mercantile
Exchange, where he became the Chief Agricultural Economist doing market
analysis, marketing and compliance. Prior to joining DWR, Mr. Beech also had
worked at two investment banking firms in Operations, Research, Managed Futures
and Sales Management.
Ray Harris, age 42, became a Director of Demeter on March 17, 1999. Mr.
Harris is currently Senior Vice President, Planning and Administration for
Morgan Stanley Dean Witter Asset Management and has worked at DWR or its
affiliates since July 1982, serving in both financial and administrative
capacities. From August 1994 to January 1999, he worked in two separate DWR
affiliates, Discover Financial
- 37 -
Services and Novus Financial Corp., culminating as Senior Vice President. Mr.
Harris received his B.A. degree from Boston College and his M.B.A. in finance
from the University of Chicago.
Richard M. DeMartini, age 46, previously served as the Chairman of the
Board and as a Director of Demeter throughout 1998. Effective as of the close of
business on December 31, 1998, Mr. DeMartini resigned as the Chairman of the
Board and as a Director of Demeter due to changes in his responsibilities within
MSDW.
Lawrence Volpe, age 51, served as a Director to Demeter throughout
1998. Effective as of the close of business on December 31, 1998, Mr. Volpe
resigned as a Director of Demeter.
Patti L. Behnke, age 38, served as Vice President and Chief Financial
Officer of Demeter through May 1998. Effective June 1, 1998, Ms. Behnke resigned
as Vice President and Chief Financial Officer of Demeter in order to take on new
responsibilities as Operations Officer - Controllers Division for MSDW, and was
replaced by Mr. Raibley.
Item 11. EXECUTIVE COMPENSATION
The Partnership has no directors and executive officers. As a limited
partnership, the business of the Partnership is managed by Demeter which is
responsible for the administration of the business affairs of the Partnership
but receives no compensation for such services.
- 38 -
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) Security Ownership of Certain Beneficial Owners - As of December
31, 1998, there were no persons known to be beneficial owners of more than 5
percent of the Units.
(b) Security Ownership of Management - At December 31, 1998, Demeter
owned 133,076.700 Units of General Partnership Interest representing a 1.58
percent interest in the Partnership.
(c) Changes in Control - None
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Refer to Note 2 - "Related Party Transactions" of "Notes to Financial
Statements", in the accompanying Annual Report to Limited Partners for the year
ended December 31, 1998, incorporated by reference in this Form 10-K. In its
capacity as the Partnership's retail commodity broker, DWR received commodity
brokerage commissions (paid and accrued by the Partnership) of $11,360,166 for
the year ended December 31, 1998.
- 39 -
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) 1. Listing of Financial Statements
The following financial statements and reports of independent auditors,
all appearing in the accompanying Annual Report to Limited Partners for the year
ended December 31, 1998 are incorporated by reference in this Form 10-K:
- Report of Deloitte & Touche LLP, independent auditors, for the
years ended December 31, 1998, 1997 and 1996.
- Statements of Financial Condition as of December 31, 1998 and
1997.
- Statements of Operations, Changes in Partners' Capital, and
Cash Flows for the years ended December 31, 1998, 1997 and
1996.
- Notes to Financial Statements.
With the exception of the aforementioned information and the
information incorporated in Items 7, 8, and 13, the Annual Report to Limited
Partners for the year ended December 31, 1998 is not deemed to be filed with
this report.
2. Listing of Financial Statement Schedules
No financial statement schedules are required to be filed with this
report.
(b) Reports on Form 8-K
No reports on Form 8-K have been filed by the Partnership during the
last quarter of the period covered
by this report.
(c) Exhibits
Refer to Exhibit Index on Page E-1.
- 40 -
SIGNATURES
Pursuant to the requirements of Sections 13 or 15(d) 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.
DEAN WITTER SPECTRUM SELECT L.P.
(Registrant)
BY: Demeter Management Corporation,
General Partner
March 25, 1999 BY: /s/ Robert E. Murray
-----------------------------------
Robert E. Murray, Director and
President
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Demeter Management Corporation.
BY: /s/ Robert E. Murray March 25, 1999
------------------------------------------
Robert E. Murray, Director and
President
/s/ Mark J. Hawley March 25, 1999
------------------------------------------
Mark J. Hawley, Director
and Chairman of the Board
/s/ Joseph G. Siniscalchi March 25, 1999
------------------------------------------
Joseph G. Siniscalchi, Director
/s/ Edward C. Oelsner III March 25, 1999
------------------------------------------
Edward C. Oelsner III, Director
/s/ Mitchell M. Merin March 25, 1999
------------------------------------------
Mitchell M. Merin, Director
/s/ Richard A. Beech March 25, 1999
------------------------------------------
Richard A. Beech, Director
/s/ Ray Harris March 25, 1999
Ray Harris, Director
/s/ Lewis A. Raibley, III March 25, 1999
--------------------------------------------
Lewis A. Raibley, III, Director, Chief
Financial Officer and Principal Accounting
Officer
- 41 -
SIGNATURES
Pursuant to the requirements of Sections 13 or 15(d) 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.
DEAN WITTER SPECTRUM SELECT L.P.
(Registrant)
BY: Demeter Management Corporation,
General Partner
March 25, 1999 BY:
---------------------------------
Robert E. Murray, Director and
President
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Demeter Management Corporation.
BY: March 25, 1999
----------------------------------------
Robert E. Murray, Director and
President
March 25, 1999
----------------------------------------
Mark J. Hawley, Director
and Chairman of the Board
March 25, 1999
----------------------------------------
Joseph G. Siniscalchi, Director
March 25, 1999
----------------------------------------
Edward C. Oelsner III, Director
__________________________________________ March 25, 1999
----------------------------------------
Mitchell M. Merin, Director
March 25, 1999
----------------------------------------
Richard A. Beech, Director
March 25, 1999
----------------------------------------
Ray Harris, Director
March 25, 1999
----------------------------------------
Lewis A. Raibley, III, Director, Chief
Financial Officer and Principal Accounting
Officer
- 41 -
EXHIBIT INDEX
ITEM
3.01 Form of Amended and Restated Limited Partnership Agreement of the
Partnership, dated as of May 31, 1998, is incorporated by reference
to Exhibit A of the Partnership's Prospectus, dated January 21, 1999,
filed with the Securities and Exchange Commission pursuant to Rule
424(b)(3) under the Securities Act of 1933, as amended, on January
26, 1999.
3.02 Certificate of Limited Partnership, dated March 21, 1991, is
incorporated by reference to Exhibit 3.02 of the Partnership's
Registration Statement on Form S-1 (File No. 33-39667) filed with the
Securities and Exchange Commission on March 27, 1991.
3.03 Amended Certificate of Limited Partnership, dated April 28, 1998, is
filed herewith.
10.01 Amended and Restated Management Agreement, dated as of June 1, 1998,
among the Partnership, Demeter Management Corporation, and Rabar
Market Research, Inc. is filed herewith.
10.02 Amended and Restated Management Agreement, dated as of June 1, 1998,
among the Partnership, Demeter Management Corporation, and EMC
Capital Management, Inc. is filed herewith
10.03 Amended and Restated Management Agreement, dated as of June 1, 1998,
among the Partnership, Demeter Management Corporation, and Sunrise
Capital Management, Inc. is filed herewith
10.04 Amended and Restated Customer Agreement, dated as of December 1,
1997, between the Partnership and Dean Witter Reynolds Inc. is filed
herewith.
10.05 Customer Agreement, dated as of December 1, 1997, among the
Partnership, Carr Futures, Inc., and Dean Witter Reynolds Inc. is
filed herewith.
10.06 International Foreign Exchange Master Agreement, dated as of August
1, 1997, between the Partnership and Carr Futures, Inc. is filed
herewith.
10.07 Subscription and Exchange Agreement and Power of Attorney to be
executed by each purchaser of Units is incorporated by reference to
Exhibit B of the Partnership's Prospectus, dated January 21, 1999,
filed with the Securities and Exchange Commission pursuant to Rule
424(b)(3) under the Securities Act of 1933, as amended, on January
26, 1999.
10.08 Escrow Agreement, dated September 30, 1994, among Dean Witter
Spectrum Strategic L.P., Dean Witter Spectrum Global Balanced L.P.,
Dean Witter Spectrum Technical L.P., Demeter Management Corporation,
Dean Witter Reynolds Inc., and Chemical Bank.
10.09 Amendment to the Escrow Agreement, dated May 11, 1998, among the
Partnership, Demeter Management Corporation, Dean Witter Reynolds
Inc., and Chemical Bank is filed herewith.
13.01 December 31, 1998 Annual Report to Limited Partners is filed herewith.