Managements Discussion and Analysis of Financial Condition and Results of
Liquidity and Capital Resources
The Partnership does not have, nor does it expect to have, any capital assets. The Partnership does not engage in sales
of goods or services. Its assets are its (i) equity in its trading account, consisting of unrestricted cash, restricted cash, net unrealized appreciation on open futures contracts, net unrealized appreciation on open forward contracts, options
purchased at fair value and investment in U.S. Treasury bills at fair value, if applicable, (ii) cash at bank and (iii) interest receivable. Because of the low margin deposits normally required in commodity trading, relatively small price
movements may result in substantial losses to the Partnership. While substantial losses could lead to a material decrease in liquidity, no such illiquidity occurred during the third quarter of 2018.
The Partnerships investment in futures, forwards and options may, from time to time, be illiquid. Most U.S.
futures exchanges limit fluctuations in prices during a single day by regulations referred to as daily price fluctuation limits or daily limits. Trades may not be executed at prices beyond the daily limit. If the price for a
particular futures or option contract has increased or decreased by an amount equal to the daily limit, positions in that futures or option contract can neither be taken nor liquidated unless traders are willing to effect trades at or within the
limit. Futures prices have occasionally moved the daily limit for several consecutive days with little or no trading. These market conditions could prevent the Partnership from promptly liquidating its futures or option contracts and result in
restrictions on redemptions.
There is no limitation on daily price movements in trading forward contracts on
foreign currencies. 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 prevent the Partnership from promptly liquidating unfavorable
positions in such markets, subjecting it to substantial losses. Either of these market conditions could result in restrictions on redemptions. For the periods covered by this report, illiquidity has not materially affected the Partnerships
Other than the risks inherent in commodity futures, forward, options, swaps and other derivatives trading
and U.S. Treasury bills and money market mutual fund securities, the Partnership knows of no trends, demands, commitments, events or uncertainties at the present time that are reasonably likely to result in the Partnerships liquidity
increasing or decreasing in any material way.
The Partnerships capital consists of the capital
contributions of the partners as increased or decreased by realized and/or unrealized gains or losses on trading and by expenses, interest income, redemptions of Redeemable Units and distributions of profits, if any.
For the nine months ended September 30, 2018, Partnership capital decreased 5.4% from $37,555,092 to $35,544,983.
This decrease was attributable to redemptions of 14.6330 General Partner Redeemable Units resulting in an outflow of $50,000 and redemptions of 1,464.0920 limited partner Redeemable Units resulting in an outflow of $4,841,608, which was partially
offset by a net gain of $2,881,499. Future redemptions could impact the amount of funds available for investments in commodity contract positions in subsequent periods.
Other than as discussed above, there are no known material trends, favorable or unfavorable, that would affect, nor
any expected material changes to, the Partnerships capital resource arrangements at the present time.
Off-Balance Sheet Arrangements and Contractual Obligations
does not have any off-balance sheet arrangements, nor does it have contractual obligations or commercial commitments to make future payments, that would affect its liquidity or capital resources.
Critical Accounting Policies
The preparation of financial statements in conformity with GAAP requires the General Partner 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. The
General Partner believes that the estimates and assumptions utilized in preparing the financial statements are reasonable. Actual results could differ from those estimates. The Partnerships significant accounting policies are described in
detail in Note 2, Basis of Presentation and Summary of Significant Accounting Policies, of 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 net realized gains (losses) and net change in unrealized gains (losses) in the Statements of Income and Expenses and Changes in Partners Capital.