-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QYt7LS4rMc5qXvy1KKH3U+hg70se4byTvAoxGfpNvbhwXlxCIJJwlLBjMn6cOnFS Z+nF4rhfdg2n9+R2Lppc0Q== 0000873799-98-000005.txt : 19980805 0000873799-98-000005.hdr.sgml : 19980805 ACCESSION NUMBER: 0000873799-98-000005 CONFORMED SUBMISSION TYPE: 424B3 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19980804 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DEAN WITTER SPECTRUM SELECT LP CENTRAL INDEX KEY: 0000873799 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 133619290 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B3 SEC ACT: SEC FILE NUMBER: 333-47829 FILM NUMBER: 98676653 BUSINESS ADDRESS: STREET 1: TWO WORLD TRADE CNTR - 62ND FLR STREET 2: C/O DEMETER MANAGEMENT CORP CITY: NEW YORK STATE: NY ZIP: 10048 BUSINESS PHONE: 2123928899 MAIL ADDRESS: STREET 1: C/O DEMETER MANAGEMENT CORP STREET 2: TWO WORLD TRADE CENTER CITY: NEW YORK STATE: NY ZIP: 10048 FORMER COMPANY: FORMER CONFORMED NAME: WITTER DEAN SELECT FUTURES FUND LP DATE OF NAME CHANGE: 19930328 424B3 1 Dean Witter Spectrum Series Monthly Report June 1998 Dear Limited Partner: The Net Asset Value per Unit for each of the four Dean Witter Spectrum Funds as of June 30, 1998 was as follows: Funds N.A.V. % change for month Spectrum Global Balanced $14.28 .03% Spectrum Select $20.63 .94% Spectrum Strategic $ 8.93 - .83% Spectrum Technical $14.33 -1.15% Spectrum Global Balanced, a balanced portfolio of stocks, bonds and managed futures utilizing the futures, options and forward markets, recorded flat performance for the month. In the stock index futures portion of the portfolio, gains were recorded from long positions in S&P 500 Index futures as domestic equity prices moved higher during the latter half of June. Additional gains were recorded in the managed futures component from short positions in nickel, copper and zinc futures as base metal prices moved lower. Smaller gains were recorded from short crude oil futures positions. These gains were offset by losses experienced in the currency markets from transactions involving the Singapore dollar. Additional currency losses were recorded from crossrate transactions involving the Japanese yen relative to the Australian dollar and Swiss franc. In the global bond futures portion of the portfolio losses from long positions in Australian and Japanese government bond futures, as prices in these markets moved lower, offset gains recorded from long positions in U.S. and European bond futures. In Spectrum Select, a Fund managed by three trading advisors who employ long-term technical trend-following trading systems across a diverse portfolio of futures, options and forward markets, gains were recorded due primarily to a significant decline in the value of the South African rand relative to the U.S. dollar. As a result, the Fund profited from short South African rand positions. Additional currency gains were recorded from short positions in the Canadian dollar and Swiss franc, as the value of these currencies moved lower relative to the U.S. dollar, and from long British pound positions as the value of the pound strengthened during the month. In the energy markets, short positions in crude oil and unleaded gas futures profited as energy prices declined due to increased supply early in the month. Additional gains were recorded in the metals markets from short positions in nickel, aluminum and zinc futures as base metal prices also moved lower. Smaller gains were recorded in soft commodities from short positions in coffee futures and long positions in cotton futures. These gains were partially offset by losses experienced in agricultural futures from short positions in soybean, corn and soybean product futures as prices moved sharply higher late in the month after showing signs of trending lower previously. Smaller losses were experienced in financial futures primarily from long Australian interest rate futures positions as prices in this market moved lower early in the month. In Spectrum Strategic, a Fund managed by three trading advisors who employ fundamental trading methodologies in a diverse portfolio of futures, options and forwards markets, losses were experienced primarily from long crude oil futures positions as oil prices moved downward early in the month on reports of abundant supply. Losses were also recorded from trading British interest rate and stock index futures as prices in these markets experienced short-term volatility. Smaller losses experienced in this market complex from long positions in Japanese and Australian bond futures, as prices in these markets moved lower during mid-month, offset gains from long positions in U.S. Treasury bond futures, as domestic bond prices finished the month higher. A portion of the Fund's overall losses for the month was offset by gains recorded in currencies from short Japanese yen positions as the value of the yen fell versus the U.S. dollar early in the month. Smaller currency gains were recorded from long British pound positions. Additional gains recorded from long silver and lumber futures positions also helped to offset the losses for the month. In Spectrum Technical, a Fund managed by three trading advisors who employ long-term technical trend-following trading systems across a diverse portfolio of futures, options and forward markets, losses were experienced primarily from long positions in Australian and Japanese government bond futures as prices in these markets moved lower early in the month. These losses were partially offset by gains from long positions in European and U.S. financial futures. In agricultural futures, losses were recorded from short positions in corn and soybean futures as prices moved higher after showing signs of trending lower previously. In metals, losses recorded from short silver and gold futures positions, as precious metals prices finished the month higher, more than offset gains from short aluminum and nickel futures positions. A portion of these losses was offset by gains recorded in the energy markets as short crude oil futures positions profited from a price decline early in the month. Short coffee futures positions were also profitable as coffee prices moved lower. In currencies, gains from short South African rand and Japanese yen positions, as the value of these currencies weakened relative to the U.S. dollar, more than offset losses from short positions in the British pound and long positions in the German mark. Should you have any questions concerning this report, please feel free to contact Demeter Management Corporation at Two World Trade Center, 62nd Floor New York , NY 10048, or your Dean Witter Financial Advisors. I hereby affirm, that to the best of my knowledge and belief, the information contained in this report is accurate and complete. Past performance is not a guarantee of future results. Sincerely, Mark J. Hawley President Demeter Management Corporation General Partner Historical Fund Performance Presented below is the percentage change in Net Asset Value per Unit from the start of each calendar year the Fund has traded. Also provided is the inception-to-date return and the annualized return since inception for the Fund. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
Funds Year Return Spectrum Global Balanced 1994 (2 months) -1.7% 1995 22.8% 1996 -3.7% 1997 18.2% 1998 (6 months) 3.9% Inception-to-Date Return: 42.8% Annualized Return: 10.2% ___________________________________________________________________________ __________ Spectrum Select 1991 (5 months) 31.2% 1992 -14.4% 1993 41.6% 1994 -5.1% 1995 23.6% 1996 5.3% 1997 6.2% 1998 (6 months) -1.1% Inception-to-Date Return 106.3% Annualized Return 11.0% ___________________________________________________________________________ __________ Spectrum Strategic 1994 (2 months) 0.1% 1995 10.5% 1996 -3.5% 1997 0.4% 1998 (6 months) -16.6% Inception-to-Date Return: -10.7% Annualized Return: -3.0% ___________________________________________________________________________ __________
Spectrum Technical 1994 (2 months) -2.2% 1995 17.6% 1996 18.4% 1997 7.5% 1998 (6 months) -2.1% Inception-to-Date Return: 43.3% Annualized Return: 10.3% ___________________________________________________________________________ __________
Statements of Operations For the Month Ended June 30, 1998 (Unaudited)
Dean Witter Spectrum Global Balanced Dean Witter Spectrum Select L.P. Percent of Percent of June 1, 1998 June 1, 1998 Beginning Net Beginning Net Amount Asset Value Amount Asset Value $ % $ REVENUES Trading Profit (Loss): Realized 1,266,941 4.00 2,882,960 1.86 Net change in unrealized (1,240,207) (3.92) (654,360) (.42) Total Trading Results 26,734 .08 2,228,600 1.44 Interest Income (DWR) 135,817 .43 561,726 .36 Total Revenues 162,551 .51 2,790,326 1.80 EXPENSES Brokerage commissions (DWR) 121,406 .38 938,360 .61 Management fees 32,991 .10 388,287 .25 Total Expenses 154,397 .48 1,326,647 .86 NET INCOME (LOSS) 8,154 .03 1,463,679 .94 Statements of Changes in Net Asset Value For the Month Ended June 30, 1998 (Unaudited) Dean Witter Spectrum Global Balanced Dean Witter Spectrum Select L.P. Units Amount Per Unit Units Amount Per Unit $ $ $ $ Net Asset Value, June 1, 1998 2,217,739.594 31,671,328 14.28 7,599,180.753 155,314,777 20.44 Net Income (Loss) - 8,154 - - 1,463,679 .19 Redemptions (11,284.693) (161,145) 14.28 (112,607.200) (2,323,087) 20.63 Subscriptions 198,962.682 2,841,187 14.28 169,117.163 3,488,888 20.63 Net Asset Value, June 30, 1998 2,405,417.583 34,359,524 14.28 7,655,690.716 157,944,257 20.63 The accompanying notes are an integral part of these financial statements.
Statements of Operations For the Month Ended June 30, 1998 (Unaudited)
Dean Witter Spectrum Strategic Dean Witter Spectrum Technical Percent of Percent of June 1, 1998 June 1, 1998 Beginning Net Beginning Net Amount Asset Value Amount Asset Value $ % $ REVENUES Trading Profit (Loss): Realized (770,060) (1.44) 17,908,263 8.80 Net change in unrealized 634,222 1.19 (19,071,119) (9.37) Total Trading Results (135,838) (.25) (1,162,856) (.57) Interest Income (DWR) 187,769 .35 721,597 .35 Total Revenues 51,931 .10 (441,259) (.22) EXPENSES Brokerage commissions (DWR) 322,563 .61 1,229,914 .60 Management fees 172,856 .32 678,574 .33 Total Expenses 495,419 .93 1,908,488 .93 NET INCOME (LOSS) (443,488) (.83) (2,349,747) (1.15) Statements of Changes in Net Asset Value For the Month Ended June 30, 1998 (Unaudited) Dean Witter Spectrum Strategic Dean Witter Spectrum Technical Units Amount Per Unit Units Amount Per Unit $ $ $ $ Net Asset Value, June 1, 1998 5,927,994.703 53,389,834 9.01 14,045,897.239 203,572,043 14.49 Net Income (Loss) - (443,488) (.08) - (2,349,747) (.16) Redemptions (141,603.177) (1,264,516) 8.93 (149,653.416) (2,144,533) 14.33 Subscriptions 146,688.998 1,309,933 8.93 470,771.323 6,746,153 14.33 Net Asset Value, June 30, 1998 5,933,080.524 52,991,763 8.93 14,367,015.146 205,823,916 14.33 The accompanying notes are an integral part of these financial statements.
Dean Witter Spectrum Series L.P. Notes to Financial Statements (Unaudited) 1. Summary of Significant Accounting Policies Organization , Dean Witter Spectrum Global Balanced L.P. (formally known as Dean Witter Spectrum Balanced L.P.)("Spectrum Balanced"), Dean Witter Spectrum Select L.P. (formally known as Dean Witter Select Futures Fund L.P.) ("Spectrum Select"), Dean Witter Spectrum Strategic L.P. ("Spectrum Strategic") and Dean Witter Spectrum Technical L.P. ("Spectrum Technical") (individually, a "Partnership", or collectively, the "Partnerships") are limited partnerships organized to engage in the speculative trading of futures and forward contracts, options on futures contracts and on physical commodities, and other commodities interests, including foreign currencies, financial instruments, precious and industrial metals, energy products, and agriculturals. The commodity broker for the Partnership is Carr Futures Inc. ("Carr"). The general partner for each Partnership is Demeter Management Corporation ("Demeter"). Demeter is a wholly-owned subsidiary of Morgan Stanley Dean Witter & Co. ("MSDW"). Demeter is required to maintain a 1% minimum interest in the equity of each Partnership and income (losses) are shared by the General and Limited Partners based upon their proportional ownership interests. Basis of Accounting , The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts in the financial statements. Revenue Recognition - Commodity futures contracts and forward contracts on foreign currencies are open commitments until settlement date. They are valued at market and the resulting unrealized gains and losses are reflected in income. Monthly, Dean Witter Reynolds, Inc. ("DWR") pays each Partnership interest income based upon 80% of its average daily Net Assets for the month in the case of Spectrum Select, Spectrum Strategic and Spectrum Technical and 100% in the case of Spectrum Balanced. The interest rate is equal to a prevailing rate on U.S. Treasury Bills. For purposes of such interest payments, Net Assets do not include monies due the Partnership on forward contracts and other commodity interests, but not actually received. Net Income (Loss) per Unit - Net income (loss) per Unit is computed using the weighted average number of units outstanding during the period. Brokerage Commissions and Related Transaction Fees and Costs , Brokerage commissions for Spectrum Balanced are accrued at a monthly rate of 1/12 of 4.60% of the Net Assets as of the first day of each month. Brokerage commissions for Spectrum Select, Spectrum Strategic and Spectrum Technical are accrued at a monthly rate of 1/12 of 7.25% of the Net Assets as of the first day of each month. Such fees will cover all brokerage commissions, transaction fees and costs and ordinary administrative and continuing offering expenses. Operating Expenses - Spectrum Balanced, Spectrum Strategic and Spectrum Technical, incur monthly management fees and may incur incentive fees. All common administrative and continuing offering expenses including legal, auditing, accounting, filing fees and other related expenses are borne by DWR through the brokerage commissions paid by each Partnership. Dean Witter Spectrum Series L.P. Notes to Financial Statements - (Continued) Spectrum Select bears all operating expenses related to its trading activities, to a maximum of one fourth of 1% annually of the Partnership's average month end Net Assets. In addition, the Partnership incurs a monthly management fee and may incur an incentive fee. Demeter bears all other operating expenses. Effective with the June 1, 1998 change to a flat rate brokerage commission, all common administrative and continuing offering expenses will be borne by DWR through the brokerage commissions. Income Taxes - No provision for income taxes has been made in the accompanying financial statements, as partners are individually responsible for reporting income or loss based upon their respective share of each Partnership's revenues and expenses for income tax purposes. Distributions - Distributions, other than on redemption of Units, are made on a pro-rata basis at the sole discretion of Demeter. No distributions have been made to date. Continuing Offering - Units of each Partnership are offered at a price equal to 100% of the Net Asset Value per Unit as of the opening of business on the first day of the month. No selling commissions or charges related to the continuing offering of Units will be paid by the Limited Partners or the Partnership. DWR will pay all such costs. Redemptions , Limited Partners may redeem some or all of their Units at 100% of the Net Asset Value Per Unit as of the end of the last day that is six months after the closing at which a person becomes a Limited Partner, upon five business days advance notice by redemption form to Demeter. Thereafter, Units may be redeemed on or prior to the last day of the twelfth month after such Units were purchased will be subject to a redemption charge equal to 2% of the Net Asset Value of a Unit on the date of such redemption. Units redeemed after the last day of the twelfth month and on or prior to the last day of the twenty-fourth month after which such units were purchased will be subject to a redemption charge equal to 1% of the Net Asset Value of a Unit on the date of such redemption. Units redeemed after the last day of the twenty-fourth month after which such Units were purchased will not be subject to a redemption charge. The foregoing redemption charges will be paid to DWR. Redemptions must be made in whole Units, in a minimum amount of 50 Units, unless a Limited Partner is redeeming his entire interest in a Partnership. Exchanges - On the last day of the first month, which occurs more than six months after a person first becomes a Limited Partner in any of the Partnerships, and the end of each month thereafter, Limited Partners may exchange their investment among the Partnerships (subject to certain restrictions outlined in the Limited Partnership Agreement) without paying additional charges. Dissolution of the Partnership - Spectrum Balanced, Spectrum Strategic and Spectrum Technical, will terminate on December 31, 2035 and Spectrum Select will terminate on December 31, 2025 regardless of their financial condition at such time, or at an earlier date if certain conditions occur as defined in each Partnership's Limited Partnership Agreement. 2. Related Party Transactions Each Partnership pays brokerage commissions to DWR as described in Note 1. Each Partnership's cash is on deposit with DWR and Carr in commodity trading accounts to meet margin requirements as needed. DWR pays interest on these funds as described in Note 1. Dean Witter Spectrum Series L.P. Notes to Financial Statements (Continued) Each Partnership is authorized to issue and sell Units at Monthly Closings at a price per Unit equal to 100% of the Net Asset Value of a Unit of such Partnership as of the close of business on the date of such monthly closing. 3. Trading Advisors Demeter, on behalf of each Partnership, retains certain commodity trading advisors to make all trading decisions for the Partnerships. The trading advisors for each Partnership are as follows: Dean Witter Spectrum Global Balanced L.P. RXR, Inc. Dean Witter Spectrum Select L.P. EMC Capital Management, Inc. Rabar Market Research, Inc. Sunrise Capital Management, Inc. Dean Witter Spectrum Strategic L.P. Blenheim Investments, Inc. Stonebrook Capital Management, Inc. Willowbridge Associates Inc. Dean Witter Spectrum Technical L.P. Campbell & Company, Inc. Chesapeake Capital Corporation John W. Henry & Company, Inc. ("JWH") Compensation to the trading advisors by the Partnerships consists of a management fee and an incentive fee as follows: Management Fee - The management fee is accrued at the rate of 5/48 of 1% of the Net Assets on the first day of each month (a 1.25% annual rate) to Spectrum Balanced. The management fee is accrued at the rate of 1/3 of 1% per month of the Net Assets allocated to each trading advisor on the first day of each month (a 4% annual rate) to Spectrum Technical. Prior to June 1, 1998, the management fee was accrued at the rate of one fourth of 1% of the Partnership's adjusted net assets, as defined in the Limited Partnership Agreement, as of the last day of each month (a 3% annual rate) to Spectrum Select. Effective June 1, 1998, the management fee is accrued at the rate of one fourth of 1% per month of the net Assets allocated to each trading advisor on the first day of each month (a 3% annual rate). Prior to June 1, 1998, the management fee was accrued at the rate of 1/3 of 1% per month of the Net Assets allocated to each trading advisor on the first day of each month (a 4% annual rate) to Spectrum Strategic. Effective June 1, 1998, management fees are accrued at a rate of 1/12 of 4% of the Net Assets allocated to each of Blenheim and Willowbridge on the first day of each month, and 1/12 of 3% of the Net Assets allocated to Stonebrook on the first day of each month. Dean Witter Spectrum Series L.P. Notes to Financial Statements - (Continued) Incentive Fee , Spectrum Balanced and Spectrum Strategic each will pay a monthly incentive fee equal to 15% of the "Trading Profits" as defined in the Limited Partnership Agreement, experienced with respect to each trading manager's allocated Net Assets as of the end of each calendar month. Prior to June 1, 1998, Spectrum Select paid, when applicable, a quarterly incentive fee to each trading advisor equal to 17.5% of the trading advisors "Trading Profits" experienced by the Net Assets allocated to such trading advisor as of the end of each calendar quarter. Effective June 1, 1998 the incentive fees will be revised to 15% of "Trading Profits" and will be paid on a monthly basis. Prior to June 1, 1998, Spectrum Technical paid a monthly incentive fee equal to 15% of the "Trading Profits" as defined in the Limited Partnership Agreement, experienced with respect to each trading manager's allocated Net Assets as of the end of each calendar month. Effective June 1, 1998, incentive fees for Spectrum Technical will be revised to 15% of the "Trading Profits" experienced with respect to the Net Assets allocated to Campbell and JWH as of the end of each calendar month, and 19% of the "Trading Profits" experienced with respect to the Net Assets allocated to Chesapeake as of the end of each calendar month. For all Partnerships, if a trading advisor has experienced "Trading losses" with respect to its allocated Net Assets at the time of a supplemental closing, the trading advisor must earn back such losses plus a pro-rata amount related to the funds allocated to the trading advisor at supplemental closing before the trading advisor is eligible for an incentive fee. 4. Legal Matters On September 6, 10, and 20, 1996 and on March 13, 1997, similar purported class actions were filed in the Superior Court of the State of California, County of Los Angeles, on behalf of all purchasers of interests in limited partnership commodity pools sold by DWR. Named defendants include DWR, Demeter, Dean Witter Futures & Currency Management Inc., MSDW (all such parties referred to hereafter as the "Dean Witter Parties"), certain limited partnership commodity pools of which Demeter is the general partner, and certain trading advisors (including JWH) to those pools. On June 16, 1997, the plaintiffs in the above actions filed a consolidated amended complaint, alleging, among other things, that the defendants committed fraud, deceit, negligent misrepresentation, various violations of the California Corporations Code, intentional and negligent breach of fiduciary duty, fraudulent and unfair business practices, unjust enrichment, and conversion in the sale and operation of the various limited partnership commodity pools. Similar purported class actions were also filed on September 18 and 20, 1996, in the Supreme Court of the State of New York, New York County, and on November 14, 1996 in the Superior Court of the State of Delaware, New Castle County against the Dean Witter Parties and certain trading advisors (including JWH) on behalf of all purchasers of interests in various limited partnership commodity pools sold by DWR. A consolidated and amended complaint in the action pending in the Supreme Court of the State of New York was filed on August 13, 1997, alleging that the defendants committed fraud, breach of fiduciary duty, and negligent misrepresentation in the sale and operation of the various limited partnership commodity pools. On December 16, 1997, upon motion of the plaintiffs, the action pending in the Superior Court of the State of Delaware was voluntarily dismissed without prejudice. The complaints seek unspecified amounts of compensatory and punitive damages and Dean Witter Spectrum Series L.P. Notes to Financial Statements - (Concluded) other relief. It is possible that additional similar actions may be filed and that, in the course of these actions, other parties could be added as defendants. The Dean Witter Parties believe that they have strong defenses to, and they will vigorously contest, the actions. Although the ultimate outcome of legal proceedings cannot be predicted with certainty, it is the opinion of management of the Dean Witter Parties that the resolution of the actions will not have a material adverse effect on the financial condition or the results of operations of any of the Dean Witter Parties. -----END PRIVACY-ENHANCED MESSAGE-----