5. Trading Activities:

The Partnership’s objective is to profit from speculative trading in Futures Interests. Therefore, the Trading Advisor will take speculative positions in Futures Interests where it feels the best profit opportunities exist for its trading strategy. As such, the average number of contracts outstanding in absolute quantities (the total of the open long and open short positions) has been presented as a part of the volume disclosure, as position direction is not an indicative factor in such volume disclosures.

All of the commodity interests owned by the Partnership are held for trading purposes. The monthly average number of futures contracts traded during the three months ended September 30, 2016 and 2015 were 1,730 and 2,329, respectively. The monthly average number of futures contracts traded during the nine months ended September 30, 2016 and 2015 were 1,721 and 2,260, respectively. The monthly average number of metals forward contracts traded during the three months ended September 30, 2016 and 2015 was 34. The monthly average number of metals forward contracts traded during the nine months ended September 30, 2016 and 2015 were 38 and 46, respectively. The monthly average notional values of currency forward contracts traded during the three months ended September 30, 2016 and 2015 were $27,550,044 and $32,417,598, respectively. The monthly average notional values of currency forward contracts traded during the nine months ended September 30, 2016 and 2015 were $29,106,570 and $28,949,146, respectively.

The following tables summarize the gross and net amounts recognized relating to the assets and liabilities of the Partnership’s derivative instruments and transactions eligible for offset subject to master netting agreements or similar agreements as of September 30, 2016 and December 31, 2015, respectively.


	Gross		Gross Amounts Offset in the Statements of		Amounts Presented in the Statements of		Gross Amounts Not Offset in the Statements of Financial Condition
September 30, 2016	Amounts Recognized		Financial Condition		Financial Condition		Financial Instruments		Cash Collateral Received/Pledged*		Net Amount
Assets
Futures	$	795,678	$	(574,580)	$	221,098	$	-	$	-	$	221,098
Forwards		150,609		(114,547)		36,062		-		-		36,062

Total assets	$	946,287	$	(689,127)	$	257,160	$	-	$	-	$	257,160

Liabilities
Futures	$	(574,580)	$	574,580	$	-	$	-	$	-	$	-
Forwards		(114,547)		114,547		-		-		-		-

Total liabilities	$	(689,127)	$	689,127	$	-	$	-	$	-	$	-

Net fair value											$	257,160	*


	Gross		Gross Amounts Offset in the Statements of		Amounts Presented in the Statements of		Gross Amounts Not Offset in the Statements of Financial Condition
December 31, 2015	Amounts Recognized		Financial Condition		Financial Condition		Financial Instruments		Cash Collateral Received/Pledged*		Net Amount
Assets
Futures	$	817,717	$	(580,290)	$	237,427	$	-	$	-	$	237,427
Forwards		239,883		(237,051)		2,832		-		-		2,832

Total assets	$	1,057,600	$	(817,341)	$	240,259	$	-	$	-	$	240,259

Liabilities
Futures	$	(580,290)	$	580,290	$	-	$	-	$	-	$	-
Forwards		(237,051)		237,051		-		-		-		-

Total liabilities	$	(817,341)	$	817,341	$	-	$	-	$	-	$	-

Net fair value											$	240,259	*

In the event of default by the Partnership, MS&Co., the Partnership’s commodity futures broker and/or the sole counterparty to the Partnership’s off-exchange-traded contracts, as applicable, has the right to offset the Partnership’s obligation with the Partnership’s cash and/or U.S. Treasury bills held by MS&Co., thereby minimizing MS&Co.’s risk of loss. There is no collateral posted by MS&Co. and as such, in the event of default by MS&Co., the Partnership is exposed to the amount shown in the Statements of Financial Condition. In the case of exchange-traded contracts, the Partnership’s exposure to counterparty risk may be reduced since the exchange’s clearinghouse interposes its credit between buyer and seller and the clearinghouse’s guarantee fund may be available in the event of a default.

The following tables indicate the gross fair values of derivative instruments of futures and forward contracts as separate assets and liabilities as of September 30, 2016 and December 31, 2015, respectively.


	September 30, 2016
Assets

Futures Contracts
Commodity	$	123,446
Equity		232,420
Currencies		162,158
Interest Rates		277,654

Total unrealized appreciation on open futures contracts		795,678


Liabilities

Futures Contracts
Commodity		(355,471)
Equity		(41,912)
Currencies		(25,595)
Interest Rates		(151,602)

Total unrealized depreciation on open futures contracts		(574,580)

Net unrealized appreciation on open futures contracts	$	221,098	*


Assets
Forward Contracts
Commodity	$	16,670
Currencies		133,939

Total unrealized appreciation on open forward contracts		150,609


Liabilities
Forward Contracts
Commodity		(69,322)
Currencies		(45,225)

Total unrealized depreciation on open forward contracts		(114,547)

Net unrealized appreciation on open forward contracts	$	36,062	**

*	This amount is in “Net unrealized appreciation on open futures contracts” in the Statements of Financial Condition.

**	This amount is in “Net unrealized appreciation on open forward contracts” in the Statements of Financial Condition.


	December 31, 2015
Assets
Futures Contracts
Commodity	$	352,267
Equity		121,112
Currencies		205,956
Interest Rates		138,382

Total unrealized appreciation on open futures contracts		817,717


Liabilities
Futures Contracts
Commodity		(146,363)
Equity		(93,411)
Currencies		(17,590)
Interest Rates		(322,926)

Total unrealized depreciation on open futures contracts		(580,290)

Net unrealized appreciation on open futures contracts	$	237,427	*


Assets
Forward Contracts
Commodity	$	87,839
Currencies		152,044

Total unrealized appreciation on open forward contracts		239,883


Liabilities
Forward Contracts
Commodity		(32,341)
Currencies		(204,710)

Total unrealized depreciation on open forward contracts		(237,051)

Net unrealized appreciation on open forward contracts	$	2,832	**

*	This amount is in “Net unrealized appreciation on open futures contracts” in the Statements of Financial Condition.

**	This amount is in “Net unrealized appreciation on open forward contracts” in the Statements of Financial Condition.

The following table indicates the trading gains and losses, by market sector, on derivative instruments for the three and nine months ended September 30, 2016 and 2015, respectively.


	Three Months Ended September 30,						Nine Months Ended September 30,
Sector	2016			2015			2016			2015
Commodity	$	(589,371)		$	1,414,721		$	(1,491,751)		$	564,087
Equity		289,975			(947,760)			(394,975)			(456,039)
Currencies		63,980			(604,389)			407,418			(437,466)
Interest Rates		(247,255)			1,196,454			2,876,591			1,426,912

Total	$	(482,671)	*	$	1,059,026	*	$	1,397,283	*	$	1,097,494	*

* This amount is in “Total trading results” in the Statements of Income and Expenses.