Form 10-Q

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether 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 Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer”, “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

World Monitor Trust III (the “Trust”) is a business trust organized under the laws of Delaware on September 28, 2004. The Trust consisted of four separate and distinct series (“Series”): Series G, H, I and J. Series G, H, I and J commenced trading operations on December 1, 2005. Effective March 31, 2007, Series H and Series I were no longer offered and on April 30, 2007 Series H and Series I were dissolved. Effective December 31, 2007, Series G was no longer offered and was dissolved. Series J will continue to exist unless terminated pursuant to the provisions of Article XIII of the Trust’s Third Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”). The assets of each Series have been segregated from those of the other Series, separately valued and independently managed, and separate financial statements have been prepared for each Series. Each Series was formed to engage in the speculative trading of a diversified portfolio of futures, forward and options contracts and may, from time to time, engage in cash and spot transactions. The fiscal year end of Series J is December 31.

Effective May 5, 2009, Preferred Investment Solutions Corp. changed its name to Kenmar Preferred Investments Corp. (“Kenmar Preferred” or the “Managing Owner”). Kenmar Preferred or Managing Owner refers to either Preferred Investment Solutions Corp. or Kenmar Preferred Investments Corp., depending on the applicable period discussed. As the Managing Owner of the Trust and of each Series, Kenmar Preferred conducts and manages the business of the Trust and each Series.

From January 1, 2008 through June 30, 2009, Series J allocated its assets to three managed accounts separately managed by the following trading advisors: Eagle Trading Systems Inc. (“Eagle”) pursuant to its Momentum Program, Ortus Capital Management Limited (“Ortus”) pursuant to its Major Currency Program, and Graham Capital Management, L.P. (“Graham”) pursuant to its K4D-15V Program. Effective July 1, 2009, Series J entered into trading agreements with an additional three trading advisors: GLC Ltd. (“GLC”) pursuant to both its Behavioral Trend and Directional Programs, Krom River Investment Management (Cayman) Limited (“Krom”) pursuant to its Commodity Diversified Program and Crabel Capital Management, LLC (“Crabel”) pursuant to its Two Plus Program. Effective March 31, 2010, the Managing Owner terminated the managed account agreement with GLC.

Beginning April 1, 2010, Series J entered into trading advisory agreements with Tudor Investment Corporation (“Tudor”) (pursuant to its Tudor Quantitative Commodities Strategy), and Paskewitz Asset Management, LLC (“Paskewitz”) (pursuant to its Contrarian Stock Index Program) (collectively with Graham, Eagle, Ortus, Krom, Crabel, Tudor, and Paskewitz, the “Trading Advisors”). Beginning April 1, 2010, Series J allocated approximately one-seventh of its net assets to each Trading Advisor’s managed account (collectively, the “Managed Accounts”), with such allocations to be re-balanced quarterly.

As a registrant with the Securities and Exchange Commission (“SEC”), the Trust and each Series are subject to the regulatory requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934.

As a commodity pool, the Trust and each Series are subject to the regulations of the Commodity Futures Trading Commission (“CFTC”), an independent agency of the 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 the various commodity exchanges where the Trust through the Managed Accounts executes transactions.

Up to $281,250,000 Series J, Class I and $93,750,000 Series J, Class II Units are being offered (totaling $375,000,000) (“Subscription Maximum”). Units are being offered to investors who meet certain established suitability standards. Prior to November 30, 2008, investments required a minimum aggregate initial subscription of $5,000 and $2,000 for certain Benefit Plan Investors (including IRAs), although the minimum purchase for any single series was $500.

Effective November 30, 2008, the Board of Directors of the Managing Owner of Series J determined that the Units would no longer be publicly offered and would only be available on a private placement basis to “accredited investors” pursuant to Regulation D under the Securities Act of 1933.

For new subscribers, the minimum initial investment is $25,000 ($10,000 for benefit plan investors (including IRAs)). The minimum additional subscription amount for current investors is $5,000.

Initially, the Units for each Series were offered for a period ending November 30, 2005 (“Initial Offering Period”) at $100 per Interest.

The subscription minimum of $30,000,000 for Series J was reached during the Initial Offering Period permitting all Series G, H, I and J to commence trading operations. Series J completed its initial offering on December 1, 2005 with gross proceeds of $31,024,443. Series H and I Units were fully redeemed as of April 30, 2007 and Series G’s Units as of December 31, 2007. Until the Subscription Maximum for Series J is reached, Series J’s Units will continue to be offered on a monthly basis at the then current Net Asset Value per Unit.

Redemptions from Series J are permitted on a monthly basis. For Class I Units issued from July 1, 2008 through June 1, 2009, Kenmar Securities Inc. was entitled to a redemption charge for Class I Units redeemed prior to the first anniversary of their purchase of up to 2% of the Net Asset Value per Unit at which they were redeemed. Class I Units issued beginning July 1, 2009 were not subject to a redemption charge. There is no redemption charge associated with the Class II Units.

In the event that the Net Asset Value of a Series, after adjustments for distributions, contributions and redemptions, declines by 50% or more since the commencement of trading activities or the first day of a fiscal year, the Series will automatically terminate. Should the Managing Owner make a determination that Series J’s aggregate net assets in relation to its operating expenses make it unreasonable or imprudent to continue the business of Series J, or, in the exercise of its reasonable discretion, if the aggregate Net Asset Value of Series J as of the close of business on any business day declines below $10 million, the Managing Owner may dissolve Series J. In addition, in the event that the Net Asset Value of the allocated assets, after adjustments for distributions, contributions and redemptions, for the Managed Accounts traded by any of the Trading Advisors declines by 40% or more since the commencement of trading activities or the first day of a fiscal year, that Managed Account will automatically terminate.

Series J’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 condensed statements 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 operations currently under the caption realized in the condensed statements of operations.

The condensed statement of financial condition, including the condensed schedule of investments, as of September 30, 2010, the condensed statements of operations for the three months ended September 30, 2010 (“Third Quarter 2010”), and for the nine months ended September 30, 2010 (“Year-To-Date 2010”) and for the three months ended September 30, 2009 (“Third Quarter 2009”) and for the nine months ended September 30, 2009 (“Year-To-Date 2009”), and the condensed statements of changes in unitholders’ capital for the Year-To-Date 2010 and Year-To-Date 2009, are unaudited. In the opinion of the Managing Owner, the condensed financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to state fairly the financial position of Series J as of September 30, 2010 and the results of its operations for the Third Quarter 2010, Third Quarter 2009, Year-To-Date 2010 and Year-To-Date 2009. The operating results for these interim periods may not be indicative of the results expected for a full year.

The condensed financial statements of Series J are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Such principles require the Managing Owner to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in Series J’s annual report on Form 10-K filed with the SEC for the year ended December 31, 2009.

Commodity futures, options and foreign exchange forward contracts are reflected in the accompanying condensed financial statements on the trade date basis. Net unrealized gain or loss on open contracts (the difference between contract trade price and market price) are offset when reflected in the condensed financial statements since the contracts are executed with the same counterparty under a master netting agreement (See Note 8). The market value of futures (exchange-traded) contracts is based upon the closing quotation on the various futures exchanges on which the contract is traded. The values which will be used by Series J for open forward and option positions will be provided by its administrator, who obtains market quotes from independent data vendors and third parties. Any change in net unrealized gain or loss during the current period is reported in the condensed statements of operations. Realized gains and losses on transactions are recognized in the period in which the contracts are closed. Brokerage commissions include other trading fees and are charged to expense when incurred.

The weighted average number of Units outstanding was computed for purposes of disclosing net income (loss) per weighted average Unit. The weighted average number of Units is equal to the number of Units outstanding during the period, adjusted proportionately for Units subscribed and redeemed based on their respective time outstanding during the period.

Series J has elected not to provide a condensed statements of cash flows since substantially all of Series J’s investments are highly liquid and carried at fair value, Series J has little or no debt and a condensed statements of changes in unitholders’ capital is provided.

Consistent with standard business practices in the normal course of business, Series J has provided general indemnifications to the Managing Owner, and others when they act, in good faith, in the best interests of Series J. Series J is unable to develop an estimate of the maximum potential amount of future payments that could potentially result from any hypothetical future claim, but expects the risk of having to make any payments under these general business indemnifications to be remote.

Series J accounts for financial assets and liabilities using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels: quoted market prices in active markets for identical assets and liabilities (Level 1), inputs other than quoted market prices that are observable for the asset or liability, either directly or indirectly (Level 2), and unobservable inputs for the asset or liability (Level 3).

Series J considers prices for exchange traded commodity futures and options contracts to be based on quoted prices in active markets for identical assets (Level 1). The values of forwards, swaps and certain options contracts for which market quotations are not readily available are priced by Super Derivatives, Bloomberg, Reuters, and or other independent third party data vendors or pricing services who derive fair values for those assets from observable inputs (Level 2). There are no Level 3 investments on September 30, 2010 or December 31, 2009.

The following table summarizes the assets and liabilities measured at fair value using the fair value hierarchy:


September 30, 2010	Level 1		Level 2			Level 3		Total
Assets:
Net unrealized gain on open futures contracts	$	2,806,537	$	0		$	0	$	2,806,537
Net unrealized gain on open forward contracts	$	0	$	1,296,506		$	0	$	1,296,506
Commodity options owned, at fair value	$	0	$	433,172		$	0	$	433,172

Liabilities:
Commodity options written, at fair value	$	0	$	(16,360	)	$	0	$	(16,360	)

December 31, 2009	Level 1		Level 2			Level 3		Total
Assets:
Net unrealized gain on open futures contracts	$	1,378,396	$	0		$	0	$	1,378,396
Commodity options owned, at fair value	$	0	$	2,183,652		$	0	$	2,183,652

Liabilities:
Net unrealized loss on open forward contracts	$	0	$	(701,135	)	$	0	$	(701,135	)
Commodity options written, at fair value	$	0	$	(10,400	)	$	0	$	(10,400	)

In January 2010, the FASB amended the existing disclosure guidance on fair value measurements, which was effective January 1, 2010, except for disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements, which is effective January 1, 2011. Among other things, the updated guidance requires additional disclosure for the amounts of significant transfers in and out of Level 1 and Level 2 measurements and requires certain Level 3 disclosures on a gross basis. Additionally, the updates amend existing guidance to require a greater level of disaggregated information and more robust disclosures about valuation techniques and inputs to fair value measurements. Since the amended guidance requires only additional disclosures, the adoption of the provisions effective January 1, 2011 will not impact Series J’s financial position or results of operations. The implementation of this guidance, for the provisions effective January 1, 2010, did not have a material impact on Series J’s financial statements.

Cash represents amounts deposited with clearing brokers and a bank, a portion of which is restricted for purposes of meeting margin requirements, which typically range from 0% to 35% of the notional amounts of the derivatives traded. A substantial portion of the cash deposited with a bank is deposited in an off-shore sweep account facility daily. As of September 30, 2010 and December 31, 2009, restricted cash totaled $11,879,347 and $9,367,166, respectively. Series J receives interest on all cash balances held by the clearing brokers and bank at prevailing rates.

Series J is treated as a partnership for U.S. federal income tax purposes. As such, Series J is not required to provide for, or pay, any U.S. federal or state income taxes. Income tax attributes that arise from its operations are passed directly to the individual Unitholders including the Managing Owner. Series J may be subject to other state and local taxes in jurisdictions in which it operates.

Series J recognizes tax benefits or expenses of uncertain tax positions in the year such determination is made when the positions are “more likely than not” to be sustained assuming examination by tax authorities. The Managing Owner has reviewed Series J’s tax positions for all open years (after December 31, 2006) and concluded that no provision for unrecognized tax benefits or expense is required in these condensed financial statements. Series J has elected an accounting policy to classify interest and penalties related to unrecognized tax benefits as interest or other expense. The 2006 through 2009 tax years generally remain subject to examination by U.S. federal and most state tax authorities.

Income and expenses (excluding the service fee and upfront sales commissions further discussed in Note 5) are allocated pro rata to the Class I Units and Class II Units monthly based on the Units outstanding during the month. Class I Units are charged with the service fee and upfront sales commission applicable to such Units. Distributions (other than redemptions of Units) may be made at the sole discretion of the Managing Owner on a pro rata basis in accordance with the respective capital balances of the Unitholders. The Managing Owner has not and does not presently intend to make any distributions.

In accordance with the Trust’s Agreement and Prospectus, organization and initial offering costs were paid by the Managing Owner, subject to reimbursement by the Trust, without interest, in up to 36 monthly payments during each of the first 36 months of Series J’s operations, provided that the Managing Owner shall not be entitled to reimbursement for such expenses in an aggregated amount in excess of 2.5% of the aggregate amount of all subscriptions accepted by Series J during the initial offering period and the first 36 months of Series J’s operations (the “Continuous Offering Period”).

In addition, Series J shall not reimburse the Managing Owner for organization and offering expenses (both initial and ongoing) in excess of 0.50% per annum of Series J’s net asset value. Organization and initial offering costs (exclusive of the initial selling fee), totaling $1,454,441 for all Series of the Trust were paid by the Managing Owner. Series J’s allocable portion of such costs was $1,304,181 of which $1,120,668 was reimbursed by Series J to the Managing Owner through September 30, 2010.

The Managing Owner is also responsible for the payment of all offering expenses of Series J incurred after the Initial Offering Period (“ongoing offering costs”), provided that the amount of such ongoing offering costs paid by the Managing Owner are subject to reimbursement by the Trust, without interest, in up to 36 monthly payments during each of the first 36 months following the month in which such expenses were paid by the Managing Owner. Through September 30, 2010, the Managing Owner has paid $1,934,669 in ongoing offering costs, of which $1,877,507 has been allocated to Series J. Ongoing offering costs incurred through November 30, 2006 in the amount of $599,062 will not be reimbursed to the Managing Owner. For the period December 1, 2006 through September 30, 2010, the Managing Owner incurred and Series J was allocated ongoing offering costs in the amount of $1,298,050 and $1,278,444, respectively. Of the $1,278,444, allocated to Series J, $635,144 will not be reimbursable to the Managing Owner.

Series J will only be liable for payment of ongoing offering costs on a monthly basis. If Series J terminates prior to completion of payment of such amounts to the Managing Owner, the Managing Owner will not be entitled to any additional payments, and Series J will have no further obligation to the Managing Owner.

During the Third Quarter 2010 and 2009 and Year-To-Date 2010 and 2009, Series J’s allocable portion of organization and initial and ongoing offering costs did not exceed 0.50% per annum of the Net Asset Value of Series J.

At September 30, 2010, of the $26,011 of offering cost payable listed on the condensed statements of financial condition, $0 is initial offering costs and $26,011 represents ongoing offering cost.

Series J reimburses the Managing Owner for services it performs for Series J, which include, but are not limited to: management, legal, accounting, registrar, transfer and assignment functions, investor communications, printing, and other administrative services.

The expenses incurred by Series J for services performed by the Managing Owner for Series J were:

Expenses payable to the Managing Owner and its affiliates as of September 30, 2010 and December 31, 2009 were $34,114 and $36,271, respectively. Such amounts are included in accrued expenses payable on the condensed statements of financial condition.

As of September 30, 2010, the Managing Owner and or its affiliates have purchased and maintained an interest in Series J in an amount less than 1% of the Net Asset Value of Series J. The Managing Owner is not required under the terms of the amended and restated Trust agreement to maintain a 1% interest.

The Managing Owner is paid a monthly management fee of 1/12 of 0.5% (0.5% annually) of Series J’s Net Asset Value at the beginning of each month (See Note 10).

Through June 30, 2009, Series J paid a service fee with respect to Class I Units, monthly in arrears, equal to 1/12 of 2% (2% per annum) of the Net Asset Value per Unit of the outstanding Class I Units as of the beginning of the month. The service fee was paid directly by Series J to Kenmar Securities Inc. (“Selling Agent”), an affiliate of the Managing Owner. The Selling Agent was responsible for paying all commissions owing to the Correspondent Selling Agents (“CSA”), who were entitled to receive from the Selling Agent an initial commission equal to 2% of the initial Net Asset Value per Unit of each Class I Unit sold by them, payable on the date such Class I Units are purchased. Commencing with the 13^th month after the purchase of a Class I Unit, the CSA received an ongoing monthly commission equal to 1/12^th of 2% (2% per annum) of the Net Asset Value per Class I Unit as of the beginning of each month of the Class I Units sold by them. Beginning July 1, 2009, Series J (rather than the Selling Agent) pays its service fee on Class I Units directly to the CSA’s.

Starting July 1, 2009, Service fee – Class I Units disclosed on the statements of operations represents the monthly 1/12 of 2% service fee calculated on all Class I Units, the initial upfront sales commission of 2% and a deduction for Series J’s recapture of the 1/12 of 2% service fee on all Units owned for less than 12 months that have received the 2% upfront sales commission, a recapture of the service fee on Units held with no Correspondent Selling Agent (“CSA”).

For the Third Quarter 2010, and Year-To-Date 2010 the Service Fee – Class I Units is composed of the following:

Series J will also pay the Selling Agent a monthly sales commission equal to 1/12th of 1% (1% annually) of the Net Asset Value of the outstanding units as of the beginning of each month.

The trustee of the Trust is Wilmington Trust Company, a Delaware banking corporation. The trustee has delegated to the Managing Owner the power and authority to manage the business and affairs of the Trust and has only nominal duties and liabilities with respect to the Trust.

Series J pays Ortus, Eagle, Graham, GLC, Krom, Crabel, Tudor and Paskewitz monthly management fees at the annual rate of 2.0%, 2.0%, 2.5%, 2.0%, 2.0%, 1.0%, 2.0% and 2.0% respectively, of their Managed Accounts’ allocated assets as defined in their respective Advisory Agreements. Additionally, Series J pays Ortus, Eagle, Graham, GLC, Krom, Crabel, Tudor and Paskewitz an incentive fee accrued monthly and paid quarterly of 20%, 20%, 20%, 20%, 20% , 25%, 20% and 20%, respectively, for achieving “New High Net Trading Profits” in their specific Managed Accounts as defined in their respective Advisory Agreements. For Year-To-Date 2010 and 2009, incentive fees earned by the Trading Advisors were $1,593,756 and $2,415,412, respectively, of which $876,392 remains payable by Series J at September 30, 2010 (See Note 10). Effective March 31, 2010, the Managing Owner terminated the managed account agreement with GLC.

The fair value of Series J’s derivatives by instrument type, as well as the location of those instruments on the condensed statements of financial condition as of September 30, 2010 and December 31, 2009, are included in the condensed schedule of investments, all of which are deemed derivatives not designated as hedging instruments.

The following presents the fair value of derivative contracts at September 30, 2010 and December 31, 2009. The fair value of derivative contracts is presented as an asset if in a gain position and a liability if in a loss position. Fair value is presented on a gross basis in the table below even though the derivative contracts qualify for net presentation in the condensed statement of financial condition.


	September 30, 2010
Description	Assets		Liabilities			Net
Futures contracts	$	9,006,110	$	(6,199,573	)	$	2,806,537
Forward Contracts		3,204,944		(1,908,438	)		1,296,506
Option Contracts		433,172		(16,360	)		416,812

Total gross fair value of derivatives	$	12,644,226	$	(8,124,371	)	$	4,519,855


	December 31, 2009
Description	Assets		Liabilities			Net
Futures contracts	$	8,024,162	$	(6,645,766	)	$	1,378,396
Forward Contracts		2,082,991		(2,784,126	)		(701,135	)
Option Contracts		2,183,652		(10,400	)		2,173,252

Total gross fair value of derivatives	$	12,290,805	$	(9,440,292	)	$	2,850,513

The trading revenue of Series J’s derivatives by instrument type, as well as the location of those gains and losses on the condensed statements of operations, for the Third Quarter 2010 and 2009 and Year-to-Date 2010 and 2009 is as follows:


	Trading Revenue for the
Type of Instrument	Third Quarter 2010			Third Quarter 2009			Year-To-Date 2010			Year-To-Date 2009
Commodities Contracts	$	1,766,389		$	631,397		$	452,621		$	(326,475	)
Currencies Contracts		1,532,333			798,620			2,109,891			2,040,421
Energy Contracts		(1,653,001	)		(995,711	)		(3,173,797	)		1,670,781
Interest Rate Contracts		1,478,283			(135,143	)		6,740,847			178,522
Metals Contracts		1,356,623			1,698,682			740,391			1,911,976
Stock Indices Contracts		171,213			4,247,004			(1,593,993	)		7,138,299
Purchased Options on Futures Contracts		(414,952	)		(922,114	)		(1,870,179	)		(922,114	)
Written Options on Futures Contracts		51,660			4,412			226,490			4,412
Forward Currency Contracts		2,069,657			2,216,229			4,979,370			6,276,332

Total	$	6,358,205		$	7,543,376		$	8,611,641		$	17,972,154


Line item in Condensed Statements of Operations
Realized	$	2,169,127		$	5,590,644		$	6,095,091		$	13,138,026
Change in unrealized		4,189,078			1,952,732			2,516,550			4,834,128

Total	$	6,358,205		$	7,543,376		$	8,611,641		$	17,972,154

For the Third Quarter and Year-to-Date 2010, the total number of closed futures contracts was approximately 37,944 and 117,804 respectively, the total number of closed options contracts was approximately 948 and 4,659, respectively, and the average monthly notional value of forwards contracts closed was approximately $1,436,902,337 and $1,833,989,922, respectively.

For the Third Quarter and Year-to-Date 2009, the total number of closed futures contracts was approximately 35,806 and 75,894 respectively, the total number of closed options contracts was approximately 2,417 and 2,417, respectively, and the average monthly notional value of forwards contracts closed was approximately $1,666,800,074 and $1,069,612,733, respectively.

The average monthly notional value of contracts closed represents the average monthly U.S. dollar notional value of future and options contracts closed and settled in cash during Third Quarter 2010 and 2009 and Year-to-Date 2010 and 2009.

Series J’s investments in Managed Accounts are subject to the market and credit risks of the futures contracts, options on futures contracts, forward currency contracts and other financial instruments held or sold short by them. Series J bears the risk of loss only to the extent of the market value of its investment and, in certain specific circumstances, distributions and redemptions received.

Series J has cash on deposit with financial institutions and in broker trading accounts. In the event of a financial institution’s insolvency, recovery of cash on deposit may be limited to account insurance or other protection afforded such deposits.

Series J is exposed to various types of risks associated with the derivative instruments and related markets in which it directly invests through its Managed Accounts. These risks include, but are not limited to, risk of loss from fluctuations in the value of derivative instruments held (market risk) and the inability of counterparties to perform under the terms of Series J’s investment activities (credit risk).

The Managing Owner 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 Unitholders 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.

Trading in futures and forward contracts (including foreign exchange) involves entering into contractual commitments to purchase or sell a particular commodity at a specified date and price. The gross or face amount of the contracts, which is typically many times that of Series J’s net assets being traded, significantly exceeds Series J’s future cash requirements since Series J intends to close out its open positions prior to settlement. As a result, Series J is generally subject only to the risk of loss arising from the change in the value of the contracts. As such, Series J considers the fair value of its derivative instruments to be the net unrealized gain or loss on the contracts. The market risk associated with Series J’s commitments to purchase commodities is limited to the gross or face amount of the contracts held. However, when Series J enters into a contractual commitment to sell commodities, it must make delivery of the underlying commodity at the contract price and then repurchase the contracts at prevailing market prices or settle in cash. Since the repurchase price to which a commodity can rise is unlimited, entering into commitments to sell commodities exposes Series J to unlimited risk. In addition, as both a buyer and seller of options, Series J 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 Series J to potentially unlimited liability, and purchased options expose Series J to a risk of loss limited to the premiums paid.

Market risk is influenced by a wide variety of factors, including government programs and policies, political and economic events, the level and volatility of interest rates, foreign currency exchange rates, the diversification effect among the derivative instruments Series J holds and the liquidity and inherent volatility of the markets in which Series J trades.

When entering into futures or forward contracts, Series J is exposed to credit risk that the counterparty to the contract will not meet its obligations. The counterparty for futures contracts traded on U.S. and most foreign futures exchanges is the clearinghouse associated with the particular exchange. In general, clearinghouses are backed by their corporate members who are required to share any financial burden resulting from the non-performance by one of their members and, as such, should significantly reduce this credit risk. In cases where the clearinghouse is not backed by the clearing members (i.e., some foreign exchanges), it is normally backed by a consortium of banks or other financial institutions. On the other hand, there is concentration risk on forward transactions entered into by Series J, as Series J’s clearing broker is the sole counterparty.

Series J has entered into a master netting agreement with UBS Securities LLC, the clearing broker for Eagle, Ortus, Graham, and Krom. Series J has also entered into a master netting agreement with Newedge USA LLC, the clearing broker for Paskewitz, Crabel and Tudor. Series J does not have a master netting agreement between UBS Securities LLC and Newedge USA LLC. As a result of the master netting agreements, when applicable, Series J presents unrealized gains and losses on open forward positions as a net amount in the condensed statements of financial condition. The amount at risk associated with counterparty non-performance of all of Series J’s contracts is the net unrealized gain (loss) included in the condensed statements of financial condition; however, counterparty non-performance on only certain of Series J’s contracts may result in greater loss than non-performance on all of Series J’s contracts. There can be no assurance that any counterparty, clearing member or clearinghouse will meet its obligations to Series J.

The Managing Owner attempts to minimize both credit and market risks by requiring Series J and its Trading Advisors to abide by various trading limitations and policies. The Managing Owner monitors compliance with these trading limitations and policies, which include, but are not limited to, executing and clearing all trades with creditworthy counterparties; limiting the amount of margin or premium required for any one commodity or all commodities combined; and generally limiting transactions to contracts which are traded in sufficient volume to permit the taking and liquidating of positions.

Series J’s futures commission merchants, in accepting orders for the purchase or sale of domestic futures contracts, are required by CFTC regulations to separately account for and segregate as belonging to Series J all assets of Series J relating to domestic futures trading and are not allowed to commingle such assets with its other assets.

At September 30, 2010 and December 31, 2009, such segregated assets totaled $23,267,357 and $20,316,765, respectively, which are included in cash and cash equivalents on the condensed statements of financial condition. Part 30.7 of the CFTC regulations also requires Series J’s futures commission merchants to secure assets of Series J related to foreign futures trading, which totaled $3,274,512 and $3,135,943 at September 30, 2010 and December 31, 2009, respectively. There are no segregation requirements for assets related to forward trading.

As of September 30, 2010, all of Series J’s open futures contracts mature within fifty-one months.

The following information presents per Unit operating performance data and other supplemental financial data for the Third Quarter 2010 and 2009 and Year-to-Date 2010 and 2009. This information has been derived from information presented in the financial statements.


	Class I						Class II
	Three months ended			Nine months ended			Three months ended			Nine months ended
	September 30, 2010						September 30, 2010
Per Unit Performance (for a Unit outstanding throughout the entire period)

Net asset value per Unit at beginning of period	$	121.64		$	124.69		$	128.59		$	130.38


Income (loss) from operations:
Net realized and change in unrealized gain⁽¹⁾		5.57			7.41			5.87			7.82
Interest income⁽¹⁾		0.02			0.07			0.03			0.07
Expenses^(1),⁽⁴⁾		(2.70	)		(7.64	)		(2.31	)		(6.09	)


Total income (loss) from operations		2.89			(0.16	)		3.59			1.80


Net asset value per Unit at end of period	$	124.53		$	124.53		$	132.18		$	132.18


Total Return⁽⁴⁾
Total return before incentive fees		3.01	%		1.03	%		3.42	%		2.55	%
Incentive fee		(0.63	)%		(1.16	)%		(0.63	)%		(1.17	)%


Total return after incentive fees		2.38	%		(0.13	)%		2.79	%		1.38	%


Supplemental Data

Ratios to average net asset value:
Net investment loss before incentive fees^(2),⁽³⁾		(6.17	)%		(6.71	)%		(4.52	)%		(4.67	)%
Incentive fee⁽⁴⁾		(0.63	)%		(1.18	)%		(0.61	)%		(1.18	)%


Net investment loss after incentive fees		(6.80	)%		(7.89	)%		(5.13	)%		(5.85	)%


Interest income⁽³⁾		0.08	%		0.07	%		0.08	%		0.07	%


Incentive fees⁽⁴⁾		0.63	%		1.18	%		0.61	%		1.18	%
Other expenses⁽³⁾		6.25	%		6.75	%		4.60	%		4.72	%


Total expenses		6.88	%		7.93	%		5.21	%		5.90	%

Total returns are calculated based on the change in value of a Unit during the period. An individual unitholders’ total returns and ratios may vary from the above total returns and ratios based on the timing of additions and redemptions.


	Class I						Class II
	Three months ended			Nine months ended			Three months ended			Nine months ended
	September 30, 2009						September 30, 2009
Per Unit Performance (for a Unit outstanding throughout the entire period)
Net asset value per Unit at beginning of period	$	125.23		$	120.57		$	129.48		$	123.39


Income from operations:
Net realized and change in unrealized gain⁽¹⁾		7.58			17.92			7.93			18.45
Interest income⁽¹⁾		0.00			0.02			0.00			0.02
Interest expense⁽¹⁾		0.00			0.00			0.00			0.00
Other expenses^(1),⁽⁵⁾		(3.40	)		(9.10	)		(2.88	)		(7.33	)


Total income from operations		4.18			8.84			5.05			11.14


Offering costs^(1),⁽⁵⁾		0.00			0.00			0.00			0.00


Net increase for the period		4.18			8.84			5.05			11.14


Net asset value per Unit at end of period	$	129.41		$	129.41		$	134.53		$	134.53


Total Return⁽⁴⁾
Total return before incentive fees		4.12	%		9.32	%		4.73	%		11.02	%
Incentive fees		(0.78	)%		(1.99	)%		(0.83	)%		(1.99	)%


Total return after incentive fees		3.34	%		7.33	%		3.90	%		9.03	%


Supplemental Data

Ratios to average net asset value:
Net investment loss before incentive fees^(2),^(3),(5)		(7.69	)%		(7.32	)%		(5.54	)%		(5.17	)%
Incentive fees⁽⁴⁾		(0.77	)%		(1.98	)%		(0.82	)%		(1.96	)%


Net investment loss after incentive fees		(8.46	)%		(9.30	)%		(6.36	)%		(7.13	)%


Interest income⁽³⁾		0.00	%		0.02	%		0.00	%		0.02	%


Incentive fees⁽⁴⁾		0.77	%		1.98	%		0.82	%		1.96	%
Interest expense⁽³⁾		0.01	%		0.00	%		0.01	%		0.00	%
Other expenses^(3),⁽⁵⁾		7.68	%		7.34	%		5.53	%		5.19	%


Total expenses		8.46	%		9.32	%		6.36	%		7.15	%

From October 1, 2010 through November 12, 2010, there were subscriptions and redemptions, inclusive of transfers, of $3,271,811 and $1,420,982, respectively.

Effective October 1, 2010 Series J entered into an amendment to change the management and incentive fee charged to some of its Trading Advisors. Series J will pay Eagle, Graham, Krom, and Paskewitz monthly management fees at the annual rate of 1.5%, 2.0%, 1.5%, and 1.0% respectively, of their Managed Accounts’ allocated assets as defined in the amendment to their respective Advisory Agreements. Additionally, effective October 1, 2010 Series J will pay Eagle, Graham, Krom, and Paskewitz an incentive fee accrued monthly and paid quarterly of 25%, 20%, 25%, and 25% respectively, for achieving “New High Net Trading Profits” in their specific Managed Accounts as defined in the amendment to their respective Advisory Agreements. Effective January 1, 2011, Ortus’ management and incentive fees shall be 1.0% and 25%.

Effective October 1, 2010 Series J will pay a monthly fee in the amount of 1/12 of 0.25% to be paid to ClariTy Managed Account & Analytics Platform LLC, an affiliate of the Managing Owner, for risk management and related services with respect to monitoring the Trading Advisors and the Trust.

The Managing Owner has determined that it is in the best interest of Series J to invest a portion of non-margin assets, either directly or indirectly through certain investment funds, in (i) U.S. government securities (which include any security issued or guaranteed as to principal or interest by the United States), (ii) any certificate of deposit for any of the foregoing, including U.S. treasury bonds, U.S. treasury bills and issues of agencies of the United States government, or (iii) corporate bonds or notes. At the end of each month, the Managing Owner will be paid 1/12 of 50% (a 50% annual rate) of the first 1% of the returns earned on its investment of non-margin assets. Series J will be credited with all additional returns earned on Series J’s investment of non-margin assets.

This report on Form 10-Q (the “Report”) for the quarter ending September 30, 2010 (“Third Quarter 2010”) includes forward-looking statements that reflect the current expectations of Kenmar Preferred Investments Corp., the managing owner of World Monitor Trust III – Series J (“Registrant”), about the future results, performance, prospects and opportunities of Registrant. The managing owner has tried to identify these forward-looking statements by using words such as “may,” “will,” “expect,” “anticipate,” “believe,” “intend,” “should,” “estimate” or the negative of those terms or similar expressions. These forward-looking statements are based on information currently available to the managing owner and are subject to a number of risks, uncertainties and other factors, both known, such as those described in this Report, and unknown, that could cause Registrant’s actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements.

You should not place undue reliance on any forward-looking statements. Except as expressly required by the Federal securities laws, the managing owner undertakes no obligation to publicly update or revise any forward-looking statements or the risks, uncertainties or other factors described in this Report, as a result of new information, future events or changed circumstances or for any other reason after the date of this Report.

World Monitor Trust III (the “Trust”) was formed as a Delaware Statutory Trust on September 28, 2004, with separate series (each, a “Series”) of units of beneficial interest (“Units” or “Interests”). Its term will expire on December 31, 2054 (unless terminated earlier in certain circumstances). The trustee of the Trust is Wilmington Trust Company. The Trust’s fiscal year for book and tax purposes ends on December 31.

The Trust’s Units were initially offered in four (4) separate and distinct Series: Series G, Series H, Series I, and Series J. The Trust may issue additional Series of Units in the future. Each Series will continue to exist until terminated pursuant to the provisions of Article XIII of the Third Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”). Each Series offers Units in two classes (each, a “Class”) – Class I and Class II. Class I Units pay a service fee. Class II Units may only be offered to investors who are represented by approved correspondent selling agents who are directly compensated by the investor for services rendered in connection with an investment in the Trust (such arrangements commonly referred to as “wrap-accounts”).

Units are offered as of the beginning of each month, and Units will continue to be offered in each Series until the maximum amount of each Series’ Units which are registered are sold. The managing owner may suspend or terminate the offering of Units of any Series at any time or extend the offering by registering additional Units. The managing owner terminated the offering of Units of Series H and Series I effective March 31, 2007 and dissolved Series H and Series I effective close of business on April 30, 2007. The Managing Owner terminated the offering of Units of Series G on December 31, 2007 and dissolved Series G effective close of business on December 31, 2007.

Effective May 5, 2009, Preferred Investment Solutions Corp. changed its name to Kenmar Preferred Investments Corp. (“Kenmar Preferred” or the “Managing Owner”). Kenmar Preferred or Managing Owner refers to either Preferred Investment Solutions Corp. or Kenmar Preferred Investments Corp., depending on the applicable period discussed. As the Registrant’s Managing Owner, Kenmar Preferred conducts and manages the business of the Registrant.

Kenmar Preferred has been the Managing Owner of Registrant since October 1, 2004. As of September 30, 2010, the Managing Owner and or its affiliates have purchased and maintained an interest in Registrant in an amount less than 1% of the Net Asset Value of Registrant. The Managing Owner is not required under the terms of the amended and restated Trust Agreement to maintain a 1% interest.

Interests are being offered to investors who meet certain established suitability standards. Prior to November 30, 2008, investments required a minimum aggregate initial subscription of $5,000 and $2,000 for certain Benefit Plan Investors (including IRAs), although the minimum purchase for any single series was $500. Effective December 1, 2008, the minimum initial investment for new subscribers is $25,000 ($10,000 for benefit plan investors (including IRAs)) and the minimum additional subscription amount for current investors, who are “accredited investors,” is $5,000.

Effective November 30, 2008, the Board of Directors of the Managing Owner of the Registrant determined that, the Registrant’s Units of beneficial interest are no longer to be publicly offered and are only to be available on a private placement basis to “accredited investors” pursuant to Regulation D under the Securities Act of 1933. This change in the manner in which the Registrant’s Units are offered has no material impact to current investors as there is no change in the fees and expenses and redemption terms of the Units or any change in the management and investment strategy and reporting provided to investors of the Registrant. The only change is in the method by which the Registrant’s Units will be available, and the increased suitability standard of persons subscribing for Units. New subscriptions must be made by persons that are “accredited investors”. Current investors that are not “accredited investors” are not required to redeem their current Units, but are not able to purchase additional Units.

Initially, the Units for each Series were offered for a period ending November 30, 2005 (“Initial Offering Period”) at $100 per Interest. The subscription minimum of $30,000,000 for Registrant was reached during the Initial Offering Period permitting all of Series G, H, I and J to commence trading operations. Registrant completed its initial offering on December 1, 2005 with gross proceeds of $31,024,443, which was fully allocated to the trading vehicles. Series H and I Units were fully redeemed as of April 30, 2007 and Series G’s Units as of December 31, 2007. Until the Subscription Maximum for Registrant is reached, Registrant’s Units will continue to be offered on a monthly basis at the then current Net Asset Value per Unit.

Effective December 1, 2005, Registrant contributed its net assets to WMT III Series G/J Trading Vehicle LLC (“G/J Trading Vehicle”), WMT III Series H/J Trading Vehicle LLC (“H/J Trading Vehicle”) and WMT III Series I/J Trading Vehicle LLC (“I/J Trading Vehicle”) and, together with the G/J Trading Vehicle and the H/J Trading Vehicle, the “Trading Vehicles”), Delaware limited liability companies, and received a voting membership interest in each Trading Vehicle. The Trading Vehicles were formed to function as aggregate trading vehicles for its members. Registrant and Series G were the sole members of G/J Trading Vehicle. Registrant, Series H and Futures Strategic Trust were the sole members of H/J Trading Vehicle. Registrant and Series I were the sole members of I/J Trading Vehicle. The Trading Vehicles engaged in the speculative trading of futures, forward and option contracts. All references herein to Registrant’s relationship with the Trading Advisors (as defined below) shall, unless the context states otherwise, refer to Registrant’s relationship with the Trading Advisors through the Trading Vehicles. The financial statements of the Trading Vehicles, including the condensed schedules of investments, are included in Registrant’s annual report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2009.

Each Trading Vehicle had its own independent commodity trading advisor that made such Trading Vehicle’s trading decisions. Each of G/J Trading Vehicle, H/J Trading Vehicle and I/J Trading Vehicle entered into advisory agreements with Graham Capital Management, LP (“Graham”), Bridgewater Associates, Inc. (“Bridgewater”) and Eagle Trading Systems Inc. (“Eagle”), respectively, (collectively, the “Trading Vehicle Trading Advisors”), to make the trading decisions for each respective Trading Vehicle. Graham traded 100% of the assets of G/J Trading Vehicle pursuant to Graham’s Global Diversified Program at 150% Leverage, which was a technical, systematic, global macro program. Bridgewater traded 100% of the assets of H/J Trading Vehicle pursuant to Bridgewater’s Aggressive Pure Alpha Futures Only – A No Benchmark program, which was a fundamental, systematic, global macro program. Eagle traded 100% of the assets of I/J Trading Vehicle pursuant to Eagle’s Momentum Program, which was a technical, systematic, global macro program. The advisory agreements could have been terminated for various reasons, including at the discretion of the Trading Vehicles. The Trading Vehicles allocated 100% of the proceeds from the initial and continuous offering of Registrant to the Trading Vehicle Trading Advisors.

G/J Trading Vehicle paid Graham a monthly management fee equal to 1/12 of 2.5% (2.5% annually) of such Trading Vehicle’s Net Asset Value. H/J Trading Vehicle paid Bridgewater a monthly management fee equal to 1/12 of 3.0% (3.0% annually) of such Trading Vehicle’s Net Asset Value. I/J Trading Vehicle paid Eagle a monthly management fee equal to 1/12 of 2.0% (2.0% annually) of such Trading Vehicle’s Net Asset Value. Each Trading Vehicle also paid the Trading Advisors an incentive fee of 20% of “New High Net Trading Profits” (as defined in the applicable Advisory Agreement) generated by such Trading Vehicle. Incentive fees accrued monthly and were paid quarterly in arrears.

Effective May 1, 2007, Registrant withdrew as a member of the H/J Trading Vehicle and the I/J Trading Vehicle and re-allocated the assets to managed accounts in the name of Registrant. The assets that Registrant allocated to the I/J Trading Vehicle were re-allocated to a managed account managed by Eagle pursuant to its Momentum Program. The assets that Registrant withdrew from the H/J Trading Vehicle were re-allocated to a managed account managed by Ortus Capital Management Limited (“Ortus”) pursuant to its Major Currency Program. The H/J Trading Vehicle and I/J Trading Vehicle were dissolved effective as of April 30, 2007.

Effective December 31, 2007, Registrant withdrew as a member of the G/J Trading Vehicle and re-allocated assets to a managed account managed by Graham pursuant to its Global Diversified Program at 150% Leverage. The G/J Trading Vehicle was dissolved effective as of December 31, 2007.

From January 1, 2008 through June 30, 2009, Registrant allocated its assets to the three managed accounts noted above (Graham, Eagle, and Ortus). Effective July 1, 2009, Registrant entered into trading advisory agreements with GLC Ltd. (“GLC”) pursuant to both its Behavioral Trend and Directional Programs, Krom River Investment Management (Cayman) Limited (“Krom”) pursuant to its Diversified Program and Crabel Capital Management, LLC (“Crabel”) pursuant to its Two Plus Program. Effective March 31, 2010, the Managing Owner terminated the managed account agreement with GLC.

Beginning April 1, 2010, the Registrant allocated its assets substantially equally to each of Graham (pursuant to its K4D-15V Program), Eagle (pursuant to its Eagle Momentum Program), Ortus (pursuant to its Major Currency Program), Krom (pursuant to its Commodity Diversified Program), Crabel (pursuant to its Two Plus Program), Tudor Investment Corporation (“Tudor”) (pursuant to its Tudor Mercis Program), and Paskewitz Asset Management, LLC (“Paskewitz”) (pursuant to its Contrarian Stock Index Program) (collectively with Graham, Eagle, Ortus, Krom, Crabel, Tudor, and Paskewitz, the “Trading Advisors”). The Registrant allocated approximately one-seventh of its net assets to each Trading Advisor’s managed account (collectively the “Managed Accounts”), with such allocations to be re-balanced quarterly.

Registrant pays Graham a monthly management fee equal to 1/12 of 2.5% (2.5% annually) of the assets allocated to Graham for trading and an incentive fee of 20% of the “New High Net Trading Profits” achieved by Graham with respect to the assets allocated to it. Registrant pays Eagle a monthly management fee equal to 1/12 of 2.0% (2.0% annually) of the assets allocated to Eagle for trading and an incentive fee of 20% of the “New High Net Trading Profits” achieved by Eagle with respect to the assets allocated to it. Registrant pays Ortus a monthly management fee equal to 1/12 of 2.0% (2.0% annually) of the assets allocated to Ortus for trading and an incentive fee of 20% of the “New High Net Trading Profits” achieved by Ortus with respect to the assets allocated to it. Registrant pays Krom a monthly management fee equal to 1/12 of 2.0% (2.0% annually) of the assets allocated to Krom for trading and an incentive fee of 20% of the “New High Net Trading Profits” achieved by Krom with respect to the assets allocated to it. Registrant pays Crabel a monthly management fee equal to 1/12 of 1.0% (1.0% annually) of the assets allocated to Crabel for trading and an incentive fee of 25% of the “New High Net Trading Profits” achieved by Crabel with respect to the assets allocated to it. Registrant pays Tudor a monthly management fee equal to 1/12 of 2.0% (2.0% annually) of the assets allocated to Tudor for trading and an incentive fee of 20% of the “New High Net Trading Profits” achieved by Tudor with respect to the assets allocated to it. Registrant pays Paskewitz a monthly management fee equal to 1/12 of 2.0% (2.0% annually) of the assets allocated to Paskewitz for trading and an incentive fee of 20% of the “New High Net Trading Profits” achieved by Paskewitz with respect to the assets allocated to it.

Effective October 1, 2010 Series J entered into an amendment to change the management and incentive fee charged by some of its Trading Advisors. Series J will pay Eagle, Graham, Krom, and Paskewitz monthly management fees at the annual rate of 1.5%, 2.0%, 1.5%, and 1.0% respectively, of their Managed Accounts’ allocated assets as defined in the amendment to their respective Advisory Agreements. Additionally, effective October 1, 2010 Series J will pay Eagle, Graham, Krom, and Paskewitz an incentive fee accrued monthly and paid quarterly of 25%, 20%, 25%, and 25% respectively, for achieving “New High Net Trading Profits” in their specific Managed Accounts as defined in the amendment to their respective Advisory Agreements. There is no change in management or incentive fee rates for Crabel or Tudor.

Effective January 1, 2011, Ortus’ management and incentive fees shall be 1.0% and 25%.

The Managing Owner and its affiliates have formed, and may continue to form, various entities to engage in the speculative trading of futures, forward and options contracts which have certain of the same investment policies as Registrant.

Registrant is an open-end fund, which solicits the sale of additional Limited Interests on a monthly basis until the maximum amount of Limited Interests being offered by Registrant have been sold. As such, Registrant may compete with other entities, whether or not formed by the Managing Owner, to attract new participants. In addition, to the extent that a Trading Advisor recommends similar or identical trades to Registrant and other accounts that it manages, Registrant may compete with those accounts for the execution of the same or similar trades, as well as with other market participants.

Registrant has no employees. Management and administrative services for Registrant are performed by the Managing Owner or third parties pursuant to the Trust Agreement, as further discussed in Notes 3, 4, 5, 6 and 9 of Registrant’s financial statements included in its annual report for the year ended December 31, 2009 (“Registrant’s 2009 Annual Report”), which is filed as an exhibit to Registrant’s Form 10-K for the fiscal year ended December 31, 2009.

Preparation of the financial statements and related disclosures in compliance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires the application of appropriate accounting rules and guidance. Applying these policies requires the Managing Owner to make judgments, estimates and assumptions in connection with the preparation of Registrant’s financial statements. Actual results may differ from the estimates used.

The Managing Owner has evaluated Registrant’s financial statements and related disclosures and has determined that the policies discussed below are critical accounting policies because they involve estimates, judgments and assumptions that are particularly complex, subjective or uncertain. For a further discussion of Registrant’s significant accounting policies, see Note 2 to Registrant’s financial statements for the year ended December 31, 2009, which was included in the annual report on Form 10-K for the fiscal year ended December 31, 2009.

The valuation of Registrant’s investments that are not traded on a United States (“U.S.”) or internationally recognized futures exchange is a critical accounting policy. The market values of futures (exchange traded) contracts is verified by Registrant’s administrator, which obtains valuation data from independent third party data providers such as Bloomberg, Reuters and Super Derivatives and compares those prices with Registrant’s clearing broker. The market value of currency swap and forward (non-exchange traded) contracts is extrapolated on a forward basis from the spot prices quoted as of 4 p.m. (EST). on the last business day of the reporting period. All values assigned by the administrator and confirmed by the Managing Owner are final and conclusive as to all of Registrant’s Unitholders. As such, if actual results vary from estimates used, they are not anticipated to have a material impact on the financial statements and related disclosures.

Registrant records all investments at fair value in its financial statements, with changes in fair value reported as a component of trading profits (losses) in the condensed statements of operations. Generally, fair values are based on quoted market prices; however, in certain circumstances, significant judgments and estimates are involved in determining fair value in the absence of an active market closing price. Registrant considers prices for exchange traded commodity futures and options contracts to be based on quoted prices in active markets for identical assets (Level 1). The values of forwards, swaps, and certain option contracts for which market quotations are not readily available are priced by independent Super Derivatives, Bloomberg, Reuters and or other third party data providers who derive fair values for those assets from observable inputs (Level 2). Level 3 inputs reflect Registrant’s assumptions that it believes market participants would use in pricing the asset or liability. Registrant develops Level 3 inputs based on the best information available in the circumstances, which may include indirect correlation to a market value, combinations of market values or Registrant’s proprietary data. Level 3 inputs generally include information derived through extrapolation or interpolation of observable market data. Registrant does not currently have any investments valued using Level 3 inputs.

Of the Registrant’s unrealized gains at September 30, 2010, $2,806,537 or 62.09% are classified as Level 1 and $1,713,318 or 37.91% as Level 2. Of the Registrant’s unrealized gains at December 31, 2009, $1,378,396 or 48.36 % are classified as Level 1 and $1,472,117 or 51.64% as Level 2. There are no Level 3 investments at September 30, 2010 or December 31, 2009.

In January 2010, the Financial Accounting Standards Board amended the existing disclosure guidance on fair value measurements, which was effective January 1, 2010, except for disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements, which is effective January 1, 2011. Among other things, the updated guidance requires additional disclosure for the amounts of significant transfers in and out of Level 1 and Level 2

measurements and requires certain Level 3 disclosures on a gross basis. Additionally, the updates amend existing guidance to require a greater level of disaggregated information and more robust disclosures about valuation techniques and inputs to fair value measurements. Since the amended guidance requires only additional disclosures, the adoption of the provisions effective January 1, 2011 will not impact Series J’s financial position or results of operations. The implementation of this guidance, for the provisions effective January 1, 2010, did not have a material impact on Series J’s financial statements.

Registrant commenced operations on December 1, 2005 with gross proceeds of $31,024,443 allocated to commodities trading. Additional contributions raised through the continuous offering of limited interests (“Limited Interests”) and general interests (“General Interests” or “Managing Owner Interests” and, together with the Limited Interests, “Interests”) of beneficial ownership in Registrant for the period from December 1, 2005 (commencement of operations) to September 30, 2010 resulted in additional gross proceeds to Registrant of $156,479,314.

Limited Interests in Registrant may be subscribed or redeemed on a monthly basis.

Subscriptions of Limited Interests and General Interests for the Third Quarter 2010 were $5,243,234 and $0, respectively. Redemptions of Limited Interests and General Interests for the Third Quarter 2010 were $5,098,978 and $0, respectively.

Subscriptions of Limited Interests and General Interests for the quarter ended September 30, 2009 (“Third Quarter 2009”) were $5,824,548 and $0, respectively. Redemptions of Limited Interests and General Interests for the Third Quarter 2009 were $6,482,241 and $0, respectively.

At September 30, 2010, approximately 100% of Registrant’s net assets were allocated to commodities trading. A significant portion of Registrant’s net assets was held in cash, which was used as margin for trading in commodities. In as much as the sole business of Registrant is to trade in commodities, Registrant continues to own such liquid assets to be used as margin. The clearing brokers and bank credit Registrant with interest income on 100% of its average daily equity maintained in its accounts with the clearing brokers and bank during each month at competitive interest rates.

The commodities contracts may be subject to periods of illiquidity because of market conditions, regulatory considerations and other reasons. For example, commodity exchanges limit fluctuations in certain commodity futures contract prices during a single day by regulations referred to as “daily limits.” During a single day, no trades may be executed at prices beyond the daily limit. Once the price of a futures contract for a particular commodity has increased or decreased by an amount equal to the daily limit, positions in the commodity can neither be taken nor liquidated unless traders are willing to effect trades at or within the limit. Commodity futures prices have occasionally moved the daily limit for several consecutive days with little or no trading. Such market conditions could prevent Registrant from promptly liquidating its commodity futures positions.

Since Registrant’s business is to trade futures, forward and option contracts, its capital is at risk due to changes in the value of these contracts (market risk) or the inability of counterparties to perform under the terms of the contracts (credit risk). Registrant’s exposure to market risk is influenced by a number of factors including the volatility of interest rates and foreign currency exchange rates, the liquidity of the markets in which the contracts are traded and the relationships among the contracts held. The inherent uncertainty of Registrant’s speculative trading as well as the development of drastic market occurrences could result in losses considerably beyond Registrant’s experience to date and could ultimately lead to a loss of all or substantially all of investors’ capital. The Managing Owner attempts to minimize these risks by requiring Registrant and the Trading Advisors to abide by various trading limitations and policies, which include limiting margin amounts, trading only in liquid markets and permitting the use of stop loss provisions. See Note 9 to Registrant’s financial statements for the year ended December 31, 2009, which is filed as an exhibit to Registrant’s 2009 Annual Report for a further discussion on the credit and market risks associated with Registrant’s futures, forward and option contracts.

The third quarter of 2010 was a roller coaster ride in the financial markets, with two months of powerful rallies sandwiching a month of risk aversion. While economic data published during the quarter showed a softening U.S. economy, it took a backseat to policymakers’ actions. Widespread expectations of another round of quantitative easing (“QE”) by the Federal Reserve (“Fed”) spurred hopes of reflation in asset prices. Moreover, the European Central Bank’s (“ECB”) success in containing the financial market fallout of the sovereign debt problem as well as keeping the banking system liquid and stable helped resuscitate confidence in the euro and the Eurozone economy. In that context, better-than-expected data out of Europe and especially robust growth in Germany buoyed financial markets even though problems in the troubled members of the Eurozone festered. U.S. Gross Domestic Product growth decelerated further in the second quarter to a 1.7% annual rate. The tone of economic data during the third quarter was mixed. Business spending was firm and consumer spending stabilized after weakening in the second quarter, housing dipped to new lows, with home sales reflecting the expiration of the Obama administration tax credits. Meanwhile, the U.S. labor markets remained disappointing throughout the third quarter and many market participants are predicting that the U.S. will enter into another recession over the next few quarters.

Despite the powerful rally in risk assets during the third quarter and the lack of flight to safety demand, U.S. Treasury bonds had another solid rally. The 10-year yield ended the quarter lower. While yields backed up a little in early September, the widespread expectations of QE lead to a smart rally in the second half of September. The Fed, the ECB, the Bank of England and the Bank of Japan all kept key rates unchanged throughout the quarter.

Increased confidence in the euro, the widespread rally in risk assets and the anticipation of the Fed’s second wave of QE all triggered a halt to the U.S. dollar rally that began in November 2009. The U.S. Dollar Index dropped 8.5%. Among the major currencies, the euro rose 10.7% and was the largest gainer against the dollar. The Swiss franc increased by 9.0%, and breached parity for the first time since early 2008. The British pound experienced more modest gains, appreciating by more than 5.3% to cap the quarter. Surprisingly, despite the risk-on environment, the Japanese yen remained strong increasing by 5.6% against the greenback and reached levels not seen since 1995. The Australian dollar surged 13.7% on the back of the commodity rally, robust economic data and surging exports to Asia. The Canadian dollar gained 2.9%.

Global equities rallied smartly in the third quarter. In the U.S., earnings continued to beat expectations. The gains were broad-based across the sectors, with technology leading the charge and financials lagging. The Dow Jones Industrial Average, S&P 500 and Nasdaq gained approximately 10.4%, 12.3% and 10.7%, respectively for the quarter. European equities snapped back even more powerfully, as the STOXX 600, a broad measure of European equities, surged approximately 18.9%, in dollar terms. The CAC, FTSE and DAX closed the quarter with gains of approximately 7.9%, 12.7% and 4.4% respectively. Pacific Rim markets posted mixed results during the quarter. Japan failed to participate in the global rally as the Nikkei edged down 0.1%. However, the Hang Seng rose 11.1% and the Korean Kospi gained 10.3%. The Australian All Ordinaries Index posted a 7.2% increase.

Commodities had a robust quarter, not surprising given the broad-based risk-aversion. Among the major commodities, only natural gas and cocoa declined during the quarter, while many commodities registered solid double-digit gains. Crude oil rose 6.9% and was one of the laggards in the commodity space, as the Organization for Economic Co-Operation and Development (“OECD”) demand continued to be soft. Natural gas plunged 22.5%, handily wiping out the previous quarter’s gain due to an oversupplied market. Heating oil ended the quarter with an approximate 13.6% gain, and reformulated gasoline rose a modest 3.2%.

Gold continued its steady climb, rising 8.3% to a record high. The growing fears of global competitive currency devaluation fueled the yellow metal rally. Silver soared by 22.7% as the engines of industrial and investment demand fired on all cylinders throughout the quarter. Base metals recorded large increases as well. Copper, aluminum and nickel ended the quarter with gains of 26.7%, 21.5% and 23.2%, respectively.

Price increases in agricultural commodities were the strongest in the commodity sector during the quarter. Sugar posted the largest gain with a 55.4% surge. Wheat surged on bad harvests and export clampdowns in Russia. The other grains and cotton were also strong performers during the quarter. Cotton soared as the world’s textile mills, nervous about a global shortage of cotton, propelled prices of the fiber to their highest levels in 15-years.

The National Bureau of Economic Research is likely mark the third quarter of 2009 as the beginning of the recovery in the US economy. Gross Domestic Product data for the quarter will not be published until later in October, but based on other data released to date, it is clear that economic growth picked up nicely in the quarter. The stimulus packages made their full impact during the quarter and the cash-for-clunkers program gave a further boost to the economy. More importantly, the US housing market, which had been at the epicenter of the current downturn, showed tentative signs of building on the modest gains of the previous quarter, aided by the $8,000 first time homebuyer credit. The latest Case-Shiller Housing Index indicated that home prices and existing and new home sales both recorded decent gains during the quarter. However, the labor market remained in the doldrums. While the pace of job losses slowed, they continued at levels that almost matched the peak of the previous recession and the unemployment rate marched relentlessly up to 9.8%. The current downturn now ranks as the worst among all postwar recessions in terms of percentage job losses.

Despite the indications of economic recovery and the growing risk appetite, US Treasury yields rallied during the quarter on the back of weak and falling inflation figures, robust demand at auctions, and the Federal Reserve’s (the “Fed”) quantitative easing program. The 10-year yield fell to end the quarter at 3.31%. The Fed kept rates unchanged through the quarter. However, at its September meeting, the Federal Open Market Committee, while reiterating its support for near zero rate policy, offered a slightly hawkish nuance, reflecting the growing discomfort among the “hawks” at the Fed. The European Central Bank, the Bank of England and the Bank of Japan kept key rates unchanged through the quarter as well. As in the US, market participants feel that the worst appears to be over across the globe.

The US dollar experienced another losing quarter, with the Dollar Index declining approximately 4%. The increased appetite for risk and the growing global discomfort with the massive monetary and fiscal policy stimuli weighed on the dollar. The British pound was the only major currency to lose ground to the US dollar during the quarter, again reflecting the global unease with massive fiscal stimulus and quantitative easing. The euro finished the third quarter up approximately 4% on the dollar. More surprising was the near 7% gain in the Japanese yen, in a quarter in which risk assets surged and Japan’s economy remained weak in comparison to its developed market peers.

Coming on the heels of what was already the best quarter in over 10 years for the S&P 500, it was remarkable that the third quarter gain was as strong as the second quarter gain. In fact, the second and third quarter 2009 combined percentage change in the S&P 500 was the largest two quarter upswing since 1975 and the second largest in the entire postwar era. Financials led the way, but the rally was broad based. The gains in the other US indices were equally impressive, with the NASDAQ recording its largest two-quarter rise since the peak of the Dotcom Bubble in 2000. The Dow Jones Industrial Average, S&P 500 and NASDAQ rose approximately 15%, 15% and 16%, respectively, for the quarter. The third quarter was even better for Europe, where the gains exceeded those in the previous quarter. The STOXX 600, a broad measure of European equities, rose approximately 18% during the quarter. The CAC, FTSE 100, and DAX closed the quarter with near 20% gains. Asian markets rose as well, but the performance was more mixed. While the Korean Kospi jumped 20% and the Hang Seng registered a solid 14% gain, the Nikkei only managed a modest 2% rise. The Australian All Ordinaries Index posted a 20% increase.

Crude oil had a basically flat quarter, ending the period up approximately 1%. Rising economic optimism and dollar weakness were offset by reports of plentiful crude inventory and continued soft demand. Natural gas surged approximately 26%, but the bottom line masks the drama during the quarter. Natural gas suffered an 18% decline in August and fell to a seven-year low in early September. However, it recovered sharply in September on the back of stronger economic data, lower-than-expected inventory reports, expectations of lower winter temperatures, and short covering. Heating oil ended the quarter with an approximate 5% gain. Reformulated gasoline had a weak quarter, declining approximately 9%, as demand recovery remained elusive.

As the economic recovery gained ground in the third quarter, incipient fears of soaring inflation down the road spurred the demand for gold even as flight-to-safety demand dwindled during the third quarter. The yellow metal posted an approximate 9% gain in the third quarter. Also, reserve diversification by China and others may well be supporting gold. Silver surged up approximately 22% with the twin engines of investment demand and industrial demand firing. Base metals witnessed overall gains across the board in the quarter as global industrial production, especially auto production, turned up smartly. Copper and zinc finished up the quarter with both realizing overall gains greater than 20%.

Pork bellies, which had suffered a collapse in the second quarter following the ban on US pork products emanating from H1N1 Influenza (Swine Flu) fears, recovered sharply in the third quarter, registering an approximate 50% increase as some countries lifted the ban. Cotton prices continued their upward march during the quarter, rising approximately 15%. Wheat and soybeans fell sharply as initial fears of bad weather did not pan out and the USDA planting reports indicated solid harvests.

Soybeans, wheat and corn posted losses of 24%, 10%, and 1%, respectively. Sugar continued its parabolic rise in the third quarter, skyrocketing approximately 43% following a 32% surge in the second quarter. The worst drought in more than two decades in India, the world’s largest consumer of sugar and the biggest swing factor in global markets, propelled sugar to its highest level since 1981. Hopes of stronger consumer spending fueled by the global economic recovery lifted cocoa prices by over 25% in the quarter. Coffee also registered a solid quarter, gaining approximately 7%.

Due to the nature of Registrant’s trading activities, a period-to-period comparison of its trading results is not meaningful.

As of September 30, 2010, the allocation of Registrant’s assets to major sectors was as follows:

Trading results for the major sectors in which Registrant traded for Third Quarter 2010 were as follows:

Currencies: (+) Registrant experienced a majority of its gains in the Australian dollar, Japanese yen, South African rand and the Swiss franc. The majority of losses were experienced in the euro, Canadian dollar, British pound and Mexican peso.

Energies: (-) Registrant experienced gains in Brent crude and natural gas. The majority of losses were experienced in crude, reformulated gasoline and heating oil.

Grains: (+) Registrant experienced gains in wheat, corn, soybeans and cotton. The majority of losses were experienced in bean oil.

Indices: (+) Registrant experienced a majority of its gains in the Dow Jones Industrial Average, Nasdaq, S&P 500 and the Taiwan Index. Losses were incurred in the Nikkei, CAC, DAX and DJ STOXX.

Interest Rates: (+) Registrant experienced a majority of its gains in the German Bund, US Treasuries and Eurodollar. The majority of losses were experienced in Australian Bonds, Japanese Government Bonds, German Bobl and the Euribor Liffe.

Meats: (+) Registrant experienced a majority of its gains in live cattle. Losses were incurred in live hogs.

Metals: (+) Registrant experienced gains in gold, copper, nickel, tin, palladium, silver and platinum. Losses were incurred in aluminum.

Softs: (+) Registrant experienced gains in sugar, coffee and citrus. Losses were incurred in cocoa.

As of September 30, 2009, the allocation of Registrant’s assets to major sectors was as follows:

Trading results for the major sectors in which Registrant traded for the Third Quarter 2009 were as follows:

Currencies: (+) Registrant experienced a majority of its gains in the Australian dollar, Japanese yen and Swiss franc. The majority of losses were experienced in the euro, Canadian and New Zealand dollars.

Energies: (-) Registrant experienced gains in Brent crude and gas oil. The majority of losses were experienced in crude, heating oil, reformulated gasoline and heating oil.

Grains: (+) Registrant experienced gains in wheat and corn. The majority of losses were experienced in soybeans, rapeseed and cotton.

Indices: (+) Registrant experienced a majority of its gains in the CAC, DAX, FTSE, Hang Seng, Nasdaq and S&P 500. Losses were incurred in the Nikkei.

Interest Rates: (-) Registrant experienced a majority of its gains in German Bobl, German Bonds and Japanese Government Bond. The majority of losses were experienced in Australian Bonds, German Bund, Euribor Liffe and US Treasuries.

Metals: (+) Registrant experienced gains in gold, copper, aluminum and copper. Losses were incurred in nickel, palladium and tin.

The Net Asset Value per Interest of Class I as of September 30, 2010 was $124.53, increase of $2.89 from the June 30, 2010 Net Asset Value per Interest of $121.64.

The Net Asset Value per Interest of Class II as of September 30, 2010 was $132.18, increase of $3.59 from the June 30, 2010 Net Asset Value per Interest of $128.59.

Registrant’s average net asset levels during the Third Quarter 2010 were approximately $140,470,000, an increase of approximately $15,613,000 as compared to the Third Quarter 2009, primarily due to the effect of additional subscriptions and positive trading performance.

Registrant’s performance for Class I and Class II for the Third Quarter 2010 was 2.38% and 2.79%, respectively. Performance includes the percentage change in Registrant’s Net Asset Value excluding the effect of any subscriptions and redemptions and includes the percentage impact of trading gains (losses) less any commissions and related fees and expenses. Past performance is not necessarily indicative of future results.

Registrant’s trading gains before commissions and related fees for the Third Quarter 2010 were approximately $6,358,000.

Commissions and other transaction fees for the Third Quarter 2010 were approximately $174,000, a decrease of approximately $38,000 as compared to the Third Quarter 2009, primarily due to a decrease in trading volumes.

Management fees to the Trading Advisors for the Third Quarter 2010 were approximately $688,000, an increase of approximately $52,000 as compared to the Third Quarter 2009, primarily due to the increase in average net asset levels discussed above.

Management fees to the Managing Owner during the Third Quarter 2010 were approximately $176,000, an increase of approximately $19,000 as compared to the Third Quarter 2009, primarily due to the increase in average net asset levels discussed above.

Service Fees for the Third Quarter 2010 were approximately $503,000 a decrease of approximately $101,000 as compared to the Third Quarter 2009, primarily due to an increase in Registrant’s recapture of 1/12 of the 2% service fee on select Units. Sales Commissions for the Third Quarter 2010 were approximately $353,000 an increase of approximately $39,000 as compared to the Third Quarter 2009, primarily due to the increase in average net asset levels discussed above.

Incentive fees are based on the “New High Net Trading Profits” generated by the Trading Advisors, as defined in the Trading Advisory Agreements between Registrant and the Trading Advisors. Incentive fees for the Third Quarter 2010 were approximately $876,000.

Operating expenses were approximately $178,000 for the Third Quarter 2010. These expenses include accounting, audit, registrar, and transfer agent, tax and legal fees as well as printing and postage costs related to reports sent to limited owners.

The Net Asset Value per Interest of Class I as of September 30, 2009 was $129.41, an increase of $4.18 from the June 30, 2009 Net Asset Value per Interest of $125.23.

The Net Asset Value per Interest of Class II as of September 30, 2009 was $134.53, an increase of $5.05 from the June 30, 2009 Net Asset Value per Interest of $129.48.

Registrant’s average net asset levels during the Third Quarter 2009 were approximately $124,857,000, an increase of approximately $10,674,000 as compared to the Third Quarter 2008, primarily due to positive trading performance and the effect of additional subscriptions.

Registrant’s performance for Class I and Class II for the Third Quarter 2009 was 3.34% and 3.90%, respectively. Performance includes the percentage change in Registrant’s Net Asset Value excluding the effect of any subscriptions and redemptions and includes the percentage impact of trading gains (losses) less any commissions and related fees and expenses. Past performance is not necessarily indicative of future results.

Registrant’s trading gains before commissions and related fees for the Third Quarter 2009 were approximately $7,543,000.

Commissions and other transaction fees for the Third Quarter 2009 were approximately $212,000, an increase of approximately $108,000 as compared to Third Quarter 2008 primarily due to increased trading volumes and increase average net asset levels discussed above.

Management fees to the Trading Advisors for the Third Quarter 2009 were approximately $636,000, an increase of approximately $18,000 as compared to Third Quarter 2008 primarily due to increased average net asset levels discussed above.

Service Fees and Sales Commissions for the Third Quarter 2009 were approximately $604,000 and $314,000, respectively, an increase of approximately $97,000 and $21,000 as compared to Third Quarter 2008 primarily due to increased average net asset levels discussed above.

Registrant pays the Managing Owner a management fee calculated on Registrant’s Net Asset Value at the beginning of each month, and therefore, such fee is affected by monthly trading performance, contributions and redemptions. Management fees to the Managing Owner during the Third Quarter 2009 were approximately $157,000, an increase of approximately $11,000, as compared to Third Quarter 2008 primarily due to increased average net asset levels discussed above.

Operating expenses were approximately $238,000 for the Third Quarter 2009. These expenses include accounting, audit, registrar, and transfer agent, tax and legal fees as well as printing and postage costs related to reports sent to limited owners.

Offering costs during Third Quarter 2009 were approximately $155,000, an increase of approximately $124,000 as compared to Third Quarter 2008, primarily due to increased average net asset levels discussed above.

Inflation has had no material impact on the operations or on the financial condition of Registrant from inception through September 30, 2010.

Registrant does not have any off-balance-sheet arrangements (as defined in Regulation S-K 303(a)(4)(ii)) that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Registrant’s contractual obligations are with the Managing Owner, the Trading Advisors and its commodity broker. Management fees payable by Registrant to the Trading Advisor s and the Managing Owner are calculated as a fixed percentage of Registrant’s Net Asset Value. Incentive fees payable by the Registrant to the Trading Advisors are at a fixed rate, calculated as a percentage of Registrant’s “New High Net Trading Profits” (as defined in the Advisory Agreements). As such, the Managing Owner cannot anticipate the amounts to be paid for future periods as Net Asset Values and “New High Net Trading Profits” are not known until a future date. Commissions payable to Registrant’s commodity broker are based on a cost per executed trade and, as such, the Managing Owner cannot anticipate the amount that will be required under the brokerage agreement, as the level of executed trades are not known until a future date. These agreements are effective for one-year terms, renewable automatically for additional one-year terms unless terminated. Additionally, these agreements may be terminated by either party thereto for various reasons. Additionally, Registrant does not enter into other long-term debt obligations, capital lease obligations, operating lease obligations or other long-term liabilities that would otherwise be reflected on Registrant’s Condensed Statement of Financial Condition, a table of contractual obligations has not been presented. For a further discussion of Registrant’s contractual obligations, see Notes 1, 3, 4, 5 and 7 to Registrant’s financial statements for the year ended December 31, 2009, which is filed as an exhibit to Registrant’s annual report on Form 10-K for the fiscal year ended December 31, 2009.

Registrant is a speculative commodity pool. The market sensitive instruments held by it are acquired for speculative trading purposes, and substantially all of Registrant’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 Registrant’s main line of business.

Market movements result in frequent changes in the fair market value of Registrant’s open positions and, consequently, in its earnings and cash flow. Registrant’s market risk is influenced by a wide variety of factors, including the level and volatility of interest rates, exchange rates, equity price levels, the market value of financial instruments and contracts, the diversification effects among Registrant’s open positions and the liquidity of the markets in which it trades.

Registrant rapidly acquires and liquidates both long and short positions in a wide range of different markets. Consequently, it is not possible to predict how a particular futures market scenario will affect performance, and Registrant’s past performance is not necessarily indicative of its future results.

“Value at Risk” is a measure of the maximum amount which Registrant could reasonably be expected to lose in a given market sector. However, the inherent uncertainty of Registrant’s speculative trading and the recurrence in the markets traded by Registrant of market movements far exceeding expectations could result in actual trading or non-trading losses far beyond the indicated Value at Risk or Registrant’s experience to date (i.e., “risk of ruin”). In light of the foregoing, as well as the risks and uncertainties intrinsic to all future projections, the quantification included in this section should not be considered to constitute any assurance or representation that Registrant’s losses in any market sector will be limited to Value at Risk or by Registrant’s attempts to manage its market risk.

Materiality as used in this section, “Quantitative and Qualitative Disclosures About Market Risk,” 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 Registrant’s market sensitive instruments.

The following quantitative disclosures regarding Registrant’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, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934. as amended (the “Exchange Act”)).

Registrant’s risk exposure in the various market sectors traded by the Trading Advisors is quantified below in terms of Value at Risk. Due to Registrant’s mark-to-market accounting, any loss in the fair value of Registrant’s open positions is directly reflected in Registrant’s earnings (realized or unrealized) and cash flow (at least in the case of exchange-traded contracts in which profits and losses on open positions are settled daily through variation margin).

Exchange maintenance margin requirements have been used by Registrant as the measure of its Value at Risk. Maintenance margin requirements are set by exchanges to equal or exceed the maximum losses reasonably expected to be incurred in the fair value of any given contract in 95%-99% of any one-day interval. The maintenance margin levels are established by dealers and exchanges using historical price studies as well as an assessment of current market volatility (including the implied volatility of the options on a given futures contract) and economic fundamentals to provide a probabilistic estimate of the maximum expected near-term one-day price fluctuation. Maintenance margin has been used rather than the more generally available initial margin, because initial margin includes a credit risk component, which is not relevant to Value at Risk.

In the case of market sensitive instruments that are not exchange-traded (almost exclusively currencies in the case of Registrant), the margin requirements for the approximate estimated equivalent futures positions have been used as Value at Risk. In those rare cases in which a futures-equivalent margin is not available, estimated dealers’ margins have been used.

In quantifying Registrant’s Value at Risk, 100% positive correlation in the different positions held in each market risk category has been assumed. Consequently, the margin requirements applicable to the open contracts have simply been aggregated to determine each trading category’s aggregate Value at Risk. The diversification effects resulting from the fact that Registrant’s positions are rarely, if ever, 100% positively correlated have not been reflected.

The following table presents the trading value at risk associated with Registrant’s open positions by market sector at September 30, 2010 and December 31, 2009. All open position trading risk exposures of Registrant have been included in calculating the figure set forth below. At September 30, 2010 and December 31, 2009, Registrant had total capitalizations of approximately $141 million and $128 million, respectively.

The following table presents the average trading value at risk of Registrant’s open positions by market sector for Third Quarter 2010 and 2009 based upon Registrant’s total average capitalization of approximately $140 million and $125 million, respectively.

The notional value of the market sector instruments held by Registrant is typically many times the applicable maintenance margin requirement (maintenance margin requirements generally range between approximately 1% and 10% of the face value) as well as many times the total capitalization of Registrant. The magnitude of Registrant’s open positions creates a “risk of ruin” not typically found in most other investment vehicles. Because of the size of its positions, certain market conditions, although unusual, but historically recurring from time to time, could cause Registrant to incur severe losses over a short period of time. The foregoing Value at Risk table, as well as the past performance of Registrant give no indication of this “risk of ruin.”

Registrant has non-trading market risk on its foreign cash balances not needed for margin. However, these balances (as well as any market risk they represent) are immaterial.

The following qualitative disclosures regarding Registrant’s market risk exposures—except for (i) those disclosures that are statements of historical fact and (ii) the descriptions of how Registrant 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 Exchange Act. Registrant’s primary market risk exposures as well as the strategies used and to be used by the Managing Owner and the Trading Advisors for managing such exposures are subject to numerous uncertainties, contingencies and risks

are one of which could cause the actual results of Registrant’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 Registrant. There can be no assurance that Registrant’s current market exposure and/or risk management strategies will not change materially or that any such strategies will be effective in either the short- or long-term. Investors must be prepared to lose all or substantially all of their investment in Registrant.

Based on average trading value at risk during the Third Quarter 2010, Registrant experienced a decrease in its value at risk, relative to capitalization levels, as compared with the value at risk at December 31, 2009.

The means by which the Managing Owner and the Trading Advisors, severally, attempt to manage the risk of Registrant’s open positions is essentially the same in all market categories traded.

The Trading Advisors attempt to minimize market risk exposure by applying their own risk management trading policies that include the diversification of trading assets into various market sectors. Additionally, the Trading Advisors have an oversight committee broadly responsible for evaluating and overseeing the Trading Advisors’ trading policies. The oversight committee meets periodically to discuss and analyze issues such as liquidity, position size, capacity, performance cycles, and new product and market strategies.

The Managing Owner attempts to minimize market risk exposure by requiring the Trading Advisors to abide by various trading limitations and policies. The Managing Owner monitors compliance with these trading limitations and policies which include, but are not limited to, limiting the amount of margin or premium required for any one commodity or all commodities combined and generally limiting transactions to contracts which are traded in sufficient volume to permit the taking and liquidating of positions. Additionally, the Managing Owner shall automatically terminate the Trading Advisor if the Net Asset Value of Registrant declines by 40% during any year or since the commencement of trading activities. Furthermore, the Trust Agreement provides that Registrant will liquidate its positions, and eventually dissolve, if Registrant experiences a decline in the net asset value of 50% in any year or since the commencement of trading activities. In each case, the decline in Net Asset Value is after giving effect for contributions, distributions and redemptions. The Managing Owner may impose additional restrictions (through modifications of such trading limitations and policies) upon the trading activities of the Trading Advisors as it, in good faith, deems to be in the best interest of Registrant.

At September 30, 2010, Registrant’s primary exposure to non-trading market risk resulted from foreign currency balances held in Euro, British Pound, Japanese Yen, Australian Dollar, Swiss Franc and Canadian Dollar. As discussed above, these balances, as well as any risk they represent, are immaterial.

Registrant’s “disclosure controls and procedures” (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are designed to ensure that information required to be disclosed by Registrant in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “SEC”), and that such information is accumulated and communicated to Registrant’s management, including the Managing Owner’s Co-Chief Executive Officers and Director of Fund Administration (who, in these capacities, function as the Principal Executive Officers and Principal Financial Accounting Officer, respectively, of Registrant), as appropriate to allow for timely decisions regarding required disclosure.

In designing and evaluating Registrant’s disclosure controls and procedures, the Managing Owner recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. Because of the inherent limitations in all control systems, no evaluation of the controls can prove absolute assurance that all control issues and instances of fraud, if any, within Registrant have been detected.

The Managing Owner’s management, under the supervision and with the participation of certain officers of the Managing Owner (including the Managing Owner’s Co-Chief Executive Officers and Director of Fund Administration), has evaluated the effectiveness of Registrant’s disclosure controls and procedures as of the end of such period and concluded that, Registrant’s disclosure controls and procedures were effective.

There have been no changes in Registrant’s internal control over financial reporting (as defined in Rules 13a – 15(f) and 15d – 15(f) under the Exchange Act) during the Third Quarter 2010 that have materially affected, or are reasonably likely to materially affect, Registrant’s internal control over financial reporting.

There are no material legal proceedings pending, on appeal, or concluded to which Registrant is a party or to which any of its assets are subject.

There have been no changes from risk factors as previously disclosed in Registrant’s Form 10-K for the fiscal year ended December 31, 2009.

The following table presents sales of unregistered interest (i.e., Managing Owner interests) exempt from registration under Section 4(2) of the Securities Act of 1933 during the period from September 28, 2004 (inception) through October 1, 2005.



3.1		Third Amended and Restated Declaration of Trust Agreement of World Monitor Trust III dated December 1, 2008 (incorporated by reference to Exhibit 13.1 to Registrant’s Form 10-K for the year ended December 31, 2009)

4.2		Subscription Requirements (annexed to the Prospectus as Exhibit B and incorporated by reference to Exhibit 4.2 to the Trust’s Post-Effective Amendment No. 3 on S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 25, 2006)

4.3		Subscription instructions, Form of Subscription Agreement and Power of Attorney (annexed to the Prospectus as Exhibit C and incorporated by reference to Exhibit 4.3 to the Trust’s Post-Effective Amendment No. 3 on S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 25, 2006)

4.4		Form of Privacy Notices of the Managing Owner dated January 2009 (incorporated by reference to Exhibit 14.1 to Registrant’s Form 10-K for the year ended December 31, 2009)

10.1		Form of Subscription Escrow Agreement (incorporated by reference to Exhibit 10.1 to the Trust’s Pre-Effective Amendment No. 2 on S-1 Registration Statement, File No. 333-119612, filed with the Commission on March 14, 2005)

10.2		Form of Advisory Agreement among WMT III Series G/J Trading Vehicle LLC, the Managing Owner and Graham Capital Management, L.P. (incorporated by reference to Exhibit 10.2 to the Trust’s Pre-Effective Amendment No. 2 on S-1 Registration Statement, File No. 333-119612, filed with the Commission on March 14, 2005)

10.3		Form of Advisory Agreement among World Monitor Trust III – Series J, the Managing Owner and Eagle Trading Systems Inc. (incorporated by reference to Exhibit 10.3 to the Trust’s Post-Effective Amendment No. 6 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 10, 2007)

10.4		Form of Advisory Agreement among World Monitor Trust III – Series J, the Managing Owner and Ortus Capital Management (Cayman) Limited (incorporated by reference to Exhibit 10.4 to the Trust’s Post-Effective Amendment No. 8 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 25, 2007)

10.5		Form of Customer Agreement between the WMT III Series G/J Trading Vehicle LLC and UBS Securities LLC (incorporated by reference to Exhibit 10.5 to the Trust’s Pre-Effective Amendment No. 2 on S-1 Registration Statement, File No. 333-119612, filed with the Commission on March 14, 2005)

10.6		Form of Customer Agreement between the World Monitor Trust III – Series J and UBS Securities LLC (incorporated by reference to Exhibit 10.6 to the Trust’s Post-Effective Amendment No. 6 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 10, 2007)

10.7		Form of FX Prime Brokerage Agreement between UBS AG and WMT III Series G/J Trading Vehicle LLC (incorporated by reference to Exhibit 10.7 to the Trust’s Post-Effective Amendment No. 6 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 10, 2007)



10.8		Form of ISDA Master Agreement between UBS AG and WMT III Series G/J Trading Vehicle LLC, Schedule to ISDA Master Agreement and Credit Support Annex to Schedule (incorporated by reference to Exhibit 10.8 to the Trust’s Post-Effective Amendment No. 6 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 10, 2007)

10.9		Form of FX Prime Brokerage Agreement between UBS AG and World Monitor Trust III – Series J (incorporated by reference to Exhibit 10.9 to the Trust’s Post-Effective Amendment No. 8 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 25, 2007)

10.10		Form of ISDA Master Agreement between UBS AG and World Monitor Trust III – Series J, Schedule to ISDA Master Agreement and Credit Support Annex to Schedule (incorporated by reference to Exhibit 10.10 to the Trust’s Post-Effective Amendment No. 8 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 25, 2007)

10.11		WMT III Series G/J Trading Vehicle LLC Organization Agreement (incorporated by reference to Exhibit 1.1 to the Trust’s Post-Effective Amendment No. 6 to Form S-1 Registration Statement, File No. 333-119612, filed with the Commission on April 10, 2007)

10.12		Form of Advisory Agreement among World Monitor Trust III – Series J, the Managing Owner and Graham Capital Management, L.P. (incorporated by reference to Exhibit 10.12 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007)

10.13		Form of Services Agreement among World Monitor Trust III – Series J, the Managing Owner and Spectrum Global Fund Administration, L.L.C. (incorporated by reference to Exhibit 10.13 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007)

10.14		Advisory Agreement dated March 24, 2010 by and among, World Monitor Trust III – Series J, Kenmar Preferred Investments Corp. and Tudor Investment Corporation (incorporated by reference to Exhibit 10.9 to Registrant’s Form 8-K, File No. 000-51651, filed with the Commission on March 26, 2010)

10.15		Advisory Agreement dated March 24, 2010 by and among, World Monitor Trust III – Series J, Kenmar Preferred Investments Corp. and Paskewitz Asset Management, LLC (incorporated by reference to Exhibit 10.10 to Registrant’s Form 8-K, File No. 000-51651, filed with the Commission on March 26, 2010)

10.16		Amendment No. 1 dated September 29, 2010, with an effective date of October 1, 2010, to the Advisory Agreement dated November 28, 2008, by and among, World Monitor Trust III – Series J, Kenmar Preferred Investments Corp. and Eagle Trading Systems Inc. (incorporated by reference to Exhibit 10.16 to Registrant’s Form 8-K, File No. 000-51651, filed with the Commission on October 1, 2010)

10.17		Amendment No. 1 dated September 29, 2010, with an effective date of October 1, 2010, to the Advisory Agreement dated November 28, 2008, by and among, World Monitor Trust III – Series J, Kenmar Preferred Investments Corp. and Graham Capital Management, L.P. (incorporated by reference to Exhibit 10.17 to Registrant’s Form 8-K, File No. 000-51651, filed with the Commission on October 1, 2010)

10.18		Amendment No. 1 dated September 29, 2010, with an effective date of October 1, 2010, to the Advisory Agreement dated July 1, 2009, by and among, World Monitor Trust III – Series J, Kenmar Preferred Investments Corp. and Krom River Investment Management (Cayman) Limited and Krom River Trading AG (incorporated by reference to Exhibit 10.18 to Registrant’s Form 8-K, File No. 000-51651, filed with the Commission on October 1, 2010)

10.19		Amendment No. 1 dated September 29, 2010, with an effective date of October 1, 2010, to the Advisory Agreement dated March 24, 2010 by and among, World Monitor Trust III – Series J, Kenmar Preferred Investments Corp. and Paskewitz Asset Management, LLC (incorporated by reference to Exhibit 10.19 to Registrant’s Form 8-K, File No. 000-5161, filed with the Commission on October 1, 2010)

10.20		Amendment No. 1 dated September 29, 2010, with an effective date of January 1, 2011, to the Advisory Agreement dated May 28, 2009, by and among, World Monitor Trust III – Series J, Kenmar Preferred Investments Corp. and Ortus Capital Management Limited (incorporated by reference to Exhibit 10.20 to Registrant’s Form 8-K, File No. 000-5161, filed with the Commission on October 1, 2010)

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.


Delaware		20-2446281
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)


900 King Street, Suite 100, Rye Brook, New York		10573
(Address of principal executive offices)		(Zip Code)


Large accelerated filer ¨		Accelerated filer ¨
Non-accelerated filer x		Smaller Reporting Company ¨


		Page

PART I – FINANCIAL INFORMATION			4

Item 1.	Financial Statements		5

	World Monitor Trust III - Series J

	Condensed Statements of Financial Condition as of September 30, 2010 (Unaudited) and December 31, 2009		6

	Condensed Schedules of Investments as of September 30, 2010 (Unaudited) and December 31, 2009		7

	Condensed Statements of Operations (Unaudited) for the Three Months and Nine Months Ended September 30, 2010 and 2009		8

	Condensed Statements of Changes in Unitholders’ Capital (Unaudited) for the Nine Months Ended September 30, 2010 and 2009		9

	Notes to Condensed Financial Statements (Unaudited)		10

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		26

Item 3.	Quantitative and Qualitative Disclosures About Market Risk		37

Item 4.	Controls and Procedures		39

PART II – OTHER INFORMATION			40

Item 1.	Legal Proceedings		40

Item 1.A.	Risk Factors		40

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		40

Item 3.	Defaults Upon Senior Securities		41

Item 5.	Other Information		41

Item 6.	Exhibits:		41


	September 30, 2010		December 31, 2009
ASSETS
Cash and cash equivalents (See Note 2)	$	139,078,379	$	127,893,953
Net unrealized gain on open futures contracts		2,806,537		1,378,396
Commodity options owned, at fair value (premiums paid $1,269,001 and $2,111,559 at September 30, 2010 and December 31, 2009, respectively)		433,172		2,183,652
Net unrealized gain on open forward contracts		1,296,506		0


Total assets	$	143,614,594	$	131,456,001


LIABILITIES
Accrued expenses payable	$	148,651	$	146,256
Commissions payable		0		12,974
Interest payable		0		1,092
Trading advisor management fees payable		227,508		214,539
Trading advisor incentive fees payable		876,392		62,430
Offering costs payable		26,011		12,990
Net unrealized loss on open forward contracts		0		701,135
Commodity options written, at fair value (premiums received $22,750 and $18,100 at September 30, 2010 and December 31, 2009, respectively)		16,360		10,400
Service fees payable (See Note 5)		161,997		209,582
Redemptions payable		694,816		735,148
Subscriptions received in advance		559,147		1,793,322


Total liabilities		2,710,882		3,899,868


UNITHOLDERS’ CAPITAL (Net Asset Value)
Class I Units:
Unitholders’ Units – 985,214.775 and 895,406.461 Units outstanding at September 30, 2010 and December 31, 2009, respectively		122,687,021		111,649,834
Managing Owner’s Units – none and none Units outstanding at September 30, 2010 and December 31, 2009, respectively		0		0
Class II Units:
Unitholders’ Units – 127,261.219 and 111,441.024 Units outstanding at September 30, 2010 and December 31, 2009, respectively		16,820,831		14,529,426
Managing Owner’s Units – 10,560.643 and 10,560.643 Units outstanding at September 30, 2010 and December 31, 2009, respectively		1,395,860		1,376,873


Total unitholders’ capital (Net Asset Value)		140,903,712		127,556,133


Total liabilities and unitholders’ capital	$	143,614,594	$	131,456,001


NET ASSET VALUE PER UNIT

Class I	$	124.53	$	124.69


Class II	$	132.18	$	130.38


	September 30, 2010						December 31, 2009
	Net Unrealized Gain (Loss) as a % of Unitholders’ Capital			Net Unrealized Gain (Loss)			Net Unrealized Gain (Loss) as a % of Unitholders’ Capital			Net Unrealized Gain (Loss)
Futures and Forward Contracts
Futures contracts purchased:
Commodities		0.37	%	$	526,526			0.23	%	$	289,625
Currencies		0.82	%		1,153,925			0.00	%		0
Energy		0.40	%		567,816			0.18	%		228,104
Interest rates		0.25	%		344,675			(0.48	)%		(605,606	)
Metals		3.96	%		5,575,787			4.68	%		5,966,762
Stock indices		0.05	%		75,527			0.50	%		634,115

Net unrealized gain on futures contracts purchased		5.85	%		8,244,256			5.11	%		6,513,000


Futures contracts sold:
Commodities		(0.02	)%		(28,030	)		(0.07	)%		(90,706	)
Currencies		0.03	%		41,336			0.18	%		232,889
Energy		(0.35	)%		(499,185	)		(0.31	)%		(392,930	)
Interest rates		(0.02	)%		(21,273	)		0.14	%		179,376
Metals		(3.41	)%		(4,800,420	)		(3.92	)%		(5,002,295	)
Stock indices		(0.09	)%		(130,147	)		(0.05	)%		(60,938	)


Net unrealized loss on futures contracts sold		(3.86	)%		(5,437,719	)		(4.03	)%		(5,134,604	)


Net unrealized gain on open futures contracts		1.99	%	$	2,806,537			1.08	%	$	1,378,396

Forward currency contracts purchased:
Net unrealized gain on forward contracts purchased		1.30	%	$	1,832,821			0.03	%	$	35,552

Forward currency contracts sold:

Net unrealized loss on forward contracts sold		(0.38	)%		(536,315	)		(0.58	)%		(736,687	)


Net unrealized gain (loss) on open forward contracts		0.92	%	$	1,296,506			(0.55	)%	$	(701,135	)


	Fair Value as a % of Unitholders’ Capital			Fair Value			Fair Value as a % of Unitholders’ Capital			Fair Value
Purchased Options on Futures Contracts
Fair value of options purchased:
Commodities		0.14	%	$	201,662			0.33	%	$	423,237
Energy		0.09	%		132,810			1.36	%		1,738,150
Metals		0.07	%		98,700			0.00	%		0
Interest rates		0.00	%		0			0.02	%		22,265

Total commodity options owned, at fair value (premiums paid $1,269,001 and $2,111,559 at September 30, 2010 and December 31, 2009, respectively)		0.30	%	$	433,172			1.71	%	$	2,183,652


Written Options on Futures Contracts
Fair value of options written:
Commodities		0.00	%	$	0			0.00	%	$	(1,120	)
Energy		(0.01	)%		(16,360	)		(0.01	)%		(9,280	)

Total commodity options written, at fair value (premiums received $22,750 and $18,100 at September 30, 2010 and December 31, 2009, respectively)		(0.01	)%	$	(16,360	)		(0.01	)%	$	(10,400	)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2010		2009		2010		2009
REVENUES
Realized	$	2,169,127	$	5,590,644	$	6,095,091	$	13,138,026
Change in unrealized		4,189,078		1,952,732		2,516,550		4,834,128
Interest income		27,824		0		73,291		20,956


Total revenues		6,386,029		7,543,376		8,684,932		17,993,110


EXPENSES
Brokerage commissions		174,002		212,073		579,871		457,052
Interest expense		0		3,783		0		3,783
Management fees		176,344		156,782		511,503		463,009
Trading advisor management fees		687,870		636,122		2,003,006		1,983,269
Trading advisor incentive fees		876,391		972,007		1,593,756		2,415,412
Service fee – Class I Units (See Note 5)		502,664		604,180		1,780,142		1,724,643
Sales commission		352,688		313,566		1,023,006		926,019
Offering costs		50,128		155,287		143,326		376,337
Operating expenses		178,157		238,010		528,693		558,435


Total expenses		2,998,244		3,291,810		8,163,303		8,907,959


NET INCOME	$	3,387,785	$	4,251,566	$	521,629	$	9,085,151

NET INCOME PER WEIGHTED AVERAGE UNITHOLDER AND MANAGING OWNER UNIT
Net income per weighted average Unitholder and Managing Owner Unit
Class I	$	2.92	$	4.18	$	0.24	$	8.86


Class II	$	3.60	$	5.36	$	2.24	$	10.62

Weighted average number of Units outstanding – Class I		991,215		869,032		964,068		883,727

Weighted average number of Units outstanding – Class II		138,070		115,714		130,179		118,566


	Class I												Class II
	Unitholders						Managing Owner Interests						Unitholders						Managing Owner Interests				Total
	Units			Amount			Units			Amount			Units			Amount			Units		Amount		Units			Amount
Nine Months Ended September 30, 2010
Unitholders’ capital at December 31, 2009		895,406.461		$	111,649,834			0.000		$	0			111,441.024		$	14,529,426			10,560.643	$	1,376,873		1,017,408.128		$	127,556,133
Additions		164,847.053			20,012,520			0.000			0			21,433.444			2,744,991			0.000		0		186,280.497			22,757,511
Redemptions		(75,038.739	)		(9,205,725	)		0.000			0			(5,613.249	)		(725,836	)		0.000		0		(80,651.988	)		(9,931,561	)
Net income					230,392						0						272,250					18,987					521,629


Unitholders’ capital at September 30, 2010		985,214.775		$	122,687,021			0.000		$	0			127,261.219		$	16,820,831			10,560.643	$	1,395,860		1,123,036.637		$	140,903,712


Nine Months Ended September 30, 2009
Unitholders’ capital at December 31, 2008		893,067.142		$	107,680,197			9,467.578		$	1,141,538			125,313.352		$	15,462,954			1,437.417	$	177,369		1,029,285.489		$	124,462,058
Additions		112,836.793			13,558,326			0.000			0			9,188.514			1,170,000			0.000		0		122,025.307			14,728,326
Redemptions		(144,651.968	)		(17,563,157	)		0.000			0			(23,988.848	)		(2,972,201	)		0.000		0		(168,640.816	)		(20,535,358	)
Transfers		0.000			0			(9,467.578	)		(1,190,639	)		0.000			0			9,123.226		1,190,639		(344.352	)		0
Net income					7,776,965						49,101						1,206,387					52,698					9,085,151


Unitholders’ capital at September 30, 2009		861,251.967		$	111,452,331			0.000		$	0			110,513.018		$	14,867,140			10,560.643	$	1,420,706		982,325.628		$	127,740,177


	Third Quarter 2010			Year-To-Date 2010
Monthly 1/12 of 2% service fee calculated on all Class I Units	$	598,419		$	1,775,446
Initial upfront 2% sales commission		47,001			371,022
Series J’s recapture of 1/12 of 2% service fee on select Units and recapture of the service fee on Units held with no CSA		(142,756	)		(366,326	)

Total	$	502,664		$	1,780,142


Sector	Allocation
Currencies		34.25	%

Energies		13.40	%

Grains		4.02	%

Indices		24.13	%

Interest Rates		7.05	%

Meats		0.13	%

Metals		15.86	%

Tropicals		1.16	%


TOTAL		100.00	%


	September 30, 2010					December 31, 2009
Market Sector	Value at Risk		% of Total Capitalization			Value at Risk		% of Total Capitalization
Interest rates	$	1,168,557		0.83	%	$	1,914,256		1.50	%
Currencies	$	5,673,200		4.02	%	$	6,656,831		5.22	%
Commodities	$	5,730,435		4.06	%	$	3,580,470		2.81	%
Stock indices	$	3,997,600		2.84	%	$	4,379,867		3.43	%

Total	$	16,569,792		11.75	%	$	16,531,425		12.96	%


	Third Quarter 2010					Third Quarter 2009
Market Sector	Value at Risk		% of Total Capitalization			Value at Risk		% of Total Capitalization
Interest rates	$	1,563,934		1.12	%	$	1,888,814		1.53	%
Currencies	$	4,878,281		3.49	%	$	6,679,452		5.41	%
Commodities	$	4,406,703		3.15	%	$	2,435,568		1.97	%
Stock indices	$	2,745,385		1.96	%	$	2,932,222		2.37	%

Total	$	13,594,302		9.73	%	$	13,936,056		11.28	%


	Amount of
Date of Sale	Units Sold		Cash Received
March 10, 2005		10	$	1,000
December 1, 2005		3,080	$	308,000
January 1, 2006		765	$	74,535
February 1, 2006		416	$	40,000
March 1, 2006		256	$	24,489
April 1, 2006		223	$	21,560
May 1, 2006		265	$	27,537
June 1, 2006		454	$	47,400
July 1, 2006		575	$	59,000
August 1, 2006		530	$	52,350
September 1, 2006		403	$	39,200
October 1, 2006		374	$	36,000
November 1, 2006		189	$	18,000
December 1, 2006		11	$	1,000
January 1, 2007		62	$	6,000
February 1, 2007		217	$	21,000
March 1, 2007		109	$	10,000
August 1, 2007		30	$	3,000
September 1, 2007		10	$	1,000
October 1, 2007		49	$	5,000
November 1, 2007		28	$	3,000
December 1, 2007		19	$	2,000
January 1, 2008		265	$	29,000
March 1, 2008		113	$	15,000
April 1, 2008		258	$	40,000
May 1, 2008		419	$	50,000
June 1, 2008		329	$	40,000
July 1, 2008		497	$	61,000


August 1, 2008	294	$	35,000
September 1, 2008	347	$	40,000
October 1, 2008	196	$	22,000



14.1		Kenmar Preferred Investments Corp. Code of Ethics (adopted pursuant to Section 406 of Sarbanes Oxley Act of 2002) as of November 9, 2009 (incorporated by reference to Exhibit 14.1 to Registrant’s Form 10-K for the year ended December 31, 2009)

31.1		Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)

31.2		Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)

32.1		Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

32.2		Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)


Commission File Number:		000-51651


WORLD MONITOR TRUST III – SERIES J

By:	Kenmar Preferred Investments Corp.,
	its Managing Owner

	By:	/s/ Kenneth A. Shewer		Date: November 12, 2010
		Name:	Kenneth A. Shewer
		Title:	Co-Chief Executive Officer
			(Principal Executive Officer)

	By:	/s/ David K. Spohr		Date: November 12, 2010
		Name:	David K. Spohr
		Title:	Senior Vice President and Director of Fund Administration
			(Principal Financial/Accounting Officer)