Trading Advisors

12 Months Ended

Dec. 31, 2019

3. Trading Advisors:

Ceres, on behalf of the Partnership, has retained certain unaffiliated commodity trading advisors, which are registered with the Commodity Futures Trading Commission to make all trading decisions on behalf of the Partnership. As of December 31, 2019, the trading advisors to the Partnership were EMC Capital Advisors, LLC (“EMC”) and Graham Capital Management, L.P. (“Graham”) (each, a “Trading Advisor” and, collectively, the “Trading Advisors”). Effective December 31, 2017, the General Partner terminated the management agreement among the Partnership, the General Partner and Rabar Market Research, Inc. (“Rabar”), pursuant to which Rabar traded a portion of the Partnership’s assets. Consequently, Rabar ceased all Futures Interest trading on behalf of the Partnership. References herein to the Trading Advisor or the Trading Advisors may also include, as relevant, Rabar.

Compensation to the Trading Advisors by the Partnership consists of a management fee and incentive fee as follows:

Management Fee.

The management fee for the Partnership is accrued at a rate of 1/12 of 1% (a 1% annual rate) per month of the Partnership’s net assets allocated to EMC on the first day of each month, and 1/12 of 1.35% (1.35% annual rate) per month of the Partnership’s net assets allocated to Graham on the first day of each month. Prior to February 1, 2019, the management fee for the Partnership was accrued at a rate of 1/12 of 1.75% (a 1.75% annual rate) per month of the Partnership’s net assets allocated to Graham.

Prior to its termination on December 31, 2017, Rabar received a management fee from the Partnership equal to 1/12 of 2% (a 2% annual rate) per month of the Partnership’s net assets allocated to Rabar on the first day of each month.

Incentive Fee.

The Partnership pays a monthly incentive fee equal to 20% of the trading profits experienced with respect to the Partnership’s net assets allocated to EMC as of the end of each calendar month, and pays an annual incentive fee equal to 18% of the trading profits experienced with respect to the Partnership’s net assets allocated to Graham at the end of each calendar year. Prior to February 1, 2019, the Partnership paid a monthly incentive fee equal to 20% of the trading profits experienced with respect to the Partnership’s net assets allocated to Graham as of the end of each calendar month. Prior to its termination on December 31, 2017, Rabar was eligible to receive a monthly incentive fee equal to 20% of the trading profits experienced with respect to the Partnership’s net assets allocated to Rabar as of the end of each calendar month.

Trading profits represent the amount by which profits from trading in Futures Interests exceed losses after brokerage, ongoing placement agent fees, General Partner fees and management fees, as applicable, are deducted. When a trading advisor experiences losses with respect to its allocation of net assets as of the end of the applicable period, the trading advisor must recover such losses before it is eligible for an incentive fee in the future. The cumulative trading losses are adjusted on a

pro-rated

basis for the amount of each month’s redemptions or reallocations.