Prospectus Supplement

424B3 1 d424b3.htm PROSPECTUS SUPPLEMENT Prospectus Supplement

Filed Pursuant to Rule 424b(3)

Registration Nos. 333-125325

333-125325-01

POWERSHARES DB COMMODITY INDEX TRACKING FUND

DB COMMODITY INDEX TRACKING MASTER FUND

SUPPLEMENT DATED FEBRUARY 2, 2007

PROSPECTUS DATED AUGUST 14, 2006

This Supplement amends and supplements, as included herein, certain information set forth in the Prospectus dated August 14, 2006, as supplemented from time-to-time (the “Prospectus”) of PowerShares DB Commodity Index Tracking Fund (the “Fund”) and DB Commodity Index Tracking Master Fund (the “Master Fund”). All capitalized terms used in this Supplement have the same meaning as in the Prospectus unless otherwise specified.

Prospective investors in the Fund should review the contents of both this Supplement and the Prospectus carefully before deciding whether to invest in the Fund.

This Supplement contains (i) an update of the second risk factor at the top of the first column under the sub-section “Risk Factors” set forth on page 3 of the Prospectus; (ii) an update of the yield on 3-month U.S. Treasury bills under the sub-heading “Segregated Accounts/Interest Income” and under Risk Factor (13) “Fees and Commissions are Charged Regardless of Profitability and May Result in Depletion of Assets” as set forth on pages 10 and 21, respectively, of the Prospectus; (iii) an update of the sub-section “Breakeven Amounts” set forth on page 13 of the Prospectus; (iv) an update of the sub-section “Breakeven Table” as set forth on page 15 of the Prospectus; (v) an update of the volatility numbers in Risk Factor (12) set forth on pages 20 and 21 of the Prospectus; (vi) an update of summary performance information relating to the Fund set forth on page 29 of the Prospectus; (vii) (a) an update of certain information with respect to the Index, including Index closing levels and related numbers and benchmarks; and (b) summary performance information for the one pool operated by the Managing Owner (other than the Fund), each as of December 31, 2006, set forth on pages 34 through 45 of the Prospectus; (viii) an update of Mr. Gregory Collett’s biography set forth on page 58 of the Prospectus; and (ix) an update of certain tax information relating to UBTI with respect to the Fund and Master Fund as set forth on page 81 of the Prospectus.

* * * * * * * * * * * * * * * * * * *

All information in the Prospectus is hereby restated, except as amended or supplemented hereby.

Neither the Securities and Exchange Commission nor any state securities commission

has approved or disapproved of these securities or determined if this Prospectus is

truthful or complete. Any representation to the contrary is a criminal offense.

THE COMMODITY FUTURES TRADING COMMISSION HAS NOT PASSED UPON THE

MERITS OF PARTICIPATING IN THIS POOL NOR HAS THE COMMISSION PASSED UPON

THE ADEQUACY OR ACCURACY OF THIS DISCLOSURE DOCUMENT.

DB COMMODITY SERVICES LLC

Managing Owner

1. The second risk factor at the top of the first column under the sub-section “Risk Factors” on page 3 is hereby deleted and replaced, in its entirety, by the following:

“•

The Fund and the Master Fund are subject to fees and expenses in the aggregate amount of approximately 0.83% per annum as described herein and will be successful only if their annual returns from futures trading, plus their annual interest income from their holdings of United States Treasury securities and other high credit quality short-term fixed income securities, exceed such fees and expenses of approximately 0.83% per annum. Because it is expected that interest income will exceed the fees and costs incurred by the Fund and Master Fund at the end of the first twelve months of an investment, the percentage of profit required for the Fund to breakeven at the end of the first twelve months of an investment, by definition, is expected to be 0.00%. The Master Fund (and, in turn, the Fund) is expected to earn interest income equal to 5.12% per annum, based upon the current yield of 3-month U.S. Treasury bills. Therefore, based upon the difference between the current yield of 3-month U.S. Treasury bills and the annual fees and expenses, the Fund is expected to have a net income equal to approximately 4.29% per annum, assuming that the Fund has not experienced gains or losses from its futures trading.”

2. The number “5.08%” with respect to the yield on 3-month U.S. Treasury bills is deleted under the sub-heading “Segregated Accounts/Interest Income” and under Risk Factor (13) “Fees and Commissions are Charged Regardless of Profitability and May Result in Depletion of Assets” on pages 10 and 21, respectively, and is replaced with “5.12%”.

3. The sub-section “Breakeven Amounts” on page 13 is hereby deleted and replaced, in its entirety, by the following:

“The estimated amount of all fees and expenses which are anticipated to be incurred by a new investor in Shares of the Fund during the first twelve months of investment is (0.83)% per annum of the net asset value of the Fund, plus the amount of any commissions charged by the investor’s broker.

The Fund and the Master Fund will be successful only if their annual returns from futures trading, plus their annual interest income from their holdings of United States Treasury securities and other high credit quality short-term fixed income securities, exceed such fees and expenses of approximately 0.83% per annum. Because it is expected that interest income will exceed the fees and costs incurred by the Fund and Master Fund at the end of the first twelve months of an investment, the percentage of profit required for the Fund to breakeven at the end of the first twelve months of an investment, by definition, is expected to be 0.00%. The Master Fund (and, in turn, the Fund) is expected to earn interest income equal to 5.12% per annum, based upon the current yield of 3-month U.S. Treasury bills. Therefore, based upon the difference between the current yield of 3-month U.S. Treasury bills and the annual fees and expenses, the Fund is expected to have a net income equal to approximately 4.29% per annum, assuming that the Fund has not experienced gains or losses from its futures trading.”

4. The sub-section “Breakeven Table” on page 15 is hereby deleted and replaced, in its entirety, by the following:

“Breakeven Table”


	Dollar Amount and Percentage of Expenses¹
Expense	$			%
Management Fee²	$	0.19		0.75	%
Organization and Offering Expense Reimbursement³	$	0.00		0.00	%
Brokerage Commissions and Fees⁴	$	0.02		0.08	%
Routine Operational, Administrative and Other Ordinary Expenses^5,6	$	0.00		0.00	%
Interest Income⁷	$	(1.28	)	(5.12	)%
12-Month Breakeven^8,9,10	$	(1.07	)	0.00	%

1.	The breakeven analysis set forth in this column assumes that the Shares have a constant month-end net asset value and is based on $25.00 as the net asset value per Share. See “Charges” on page 45 for an explanation of the expenses included in the “Breakeven Table.”

2.	From the Management Fee, the Managing Owner will be responsible for paying the fees and expenses of the Administrator, ALPS Distributors and AIM Distributors.

Effective July 12, 2006, the Managing Owner became responsible for paying the organization and offering expense reimbursement not yet paid by the Fund and the Master Fund. The aggregate amount of the organization of the Fund and the Master Fund and the initial offering expenses of the Shares were $1,613,218, of which $168,255 has been accrued and $113,053 has been reimbursed to the Managing Owner by the Master Fund as of July 11, 2006. The aggregate amount of expenses incurred in connection with the continuous offering of Shares, which commenced as of February 1, 2006 were $150,400, of which $15,683 has been accrued and $10,539 has been reimbursed to the Managing Owner by the Master Fund as of July 11, 2006.

4.	The actual amount of brokerage commissions and trading fees to be incurred will vary based upon the trading frequency of the Master Fund and the specific futures contracts traded.

5.	Effective July 12, 2006, the Managing Owner became responsible for paying all routine operational, administrative and other ordinary expenses of the Fund and the Master Fund going forward.

In connection with orders to create and redeem Baskets, Authorized Participants pay a transaction fee in the amount of $500 per order. Because these transaction fees are de minimis in amount, are charged on a transaction-by-transaction basis (and not on a Basket-by-Basket basis), and are borne by the Authorized Participants, they have not been included in the Breakeven Table.

7.	Interest income currently is estimated to be earned at a rate of 5.12%, based upon the current yield on 3-month U.S. Treasury bills.

Because it is expected that interest income will exceed the fees and costs incurred by the Fund and Master Fund at the end of the first twelve months of an investment, the percentage of profit required for the Fund to breakeven at the end of the first twelve months of an investment, by definition, is expected to be 0.00%.

The Fund and the Master Fund is subject to (i) a Management Fee of 0.75% per annum and (ii) estimated brokerage commissions and fees of 0.08% per annum. The Fund and the Master Fund are subject to fees and expenses in the aggregate amount of approximately 0.83% per annum. The Fund and Master Fund will be successful only if their annual returns from the underlying futures contracts, including annual income from 3-month U.S. Treasury bills, exceed approximately 0.83% per annum. The Master Fund (and, in turn, the Fund) is expected to earn 5.12% per annum, based upon the current yield of 3-month U.S. Treasury bills. Therefore, based upon the difference between the current yield of 3-month U.S. Treasury bills and the annual fees and expenses, the Fund would be expected to earn approximately 4.29% per annum, assuming that the Fund has not experienced either gains or losses resulting from investing in the underlying futures contracts.

10.

You may pay customary brokerage commissions in connection with purchases of the Shares. Because such brokerage commission rates will vary from investor to investor, such brokerage commissions have not been included in the Breakeven Table. Investors are encouraged to review the terms of their brokerage accounts for applicable charges.

5. Risk Factor (12) set forth on pages 20 and 21 of the Prospectus is hereby deleted and replaced, in its entirety, with the following:

“(12) Price Volatility May Possibly Cause the Total Loss of Your Investment.

Futures contracts have a high degree of price variability and are subject to occasional rapid and substantial changes. Consequently, you could lose all or substantially all of your investment in the Fund.

The following table* reflects various measures of volatility** of the history of the Index as calculated on an excess return basis:


Volatility Type	Volatility
Daily volatility over full history	16.26	%
Average rolling 3 month daily volatility	15.39	%
Monthly return volatility	15.13	%
Average annual volatility	15.86	%

The following table reflects the daily volatility on an annual basis of the Index:


Year	Daily Volatility
1988***	16.35	%
1989	16.04	%
1990	24.64	%
1991	16.53	%
1992	9.55	%
1993	9.56	%
1994	11.90	%
1995	9.73	%
1996	17.67	%
1997	11.74	%
1998	15.72	%
1999	17.32	%
2000	19.86	%
2001	16.91	%
2002	15.57	%
2003	17.38	%
2004	20.19	%
2005	17.76	%
2006*	16.88	%

*	As of December 31, 2006. Past Index results are not necessarily indicative of future changes, positive and negative, in the Index.

**	Volatility, for these purposes means the following:

Daily Volatility: The relative rate at which the price of the Index moves up and down, found by calculating the annualized standard deviation of the daily change in price.

Monthly Return Volatility: The relative rate at which the price of the Index moves up and down, found by calculating the annualized standard deviation of the monthly change in price.

Average Annual Volatility: The average of yearly volatilities for a given sample period. The yearly volatility is the relative rate at which the price of the Index moves up and down, found by calculating the annualized standard deviation of the daily change in price for each business day in the given year.

***As of July 31, 1988.”

6. The section entitled “PERFORMANCE OF POWERSHARES DB COMMODITY INDEX TRACKING FUND” set forth on page 29 of the Prospectus is hereby deleted and replaced, in its entirety, with the following:

“PERFORMANCE OF POWERSHARES DB COMMODITY INDEX TRACKING FUND

Name of Pool: PowerShares DB Commodity Index Tracking Fund

Type of Pool: Public, Exchange-Listed Commodity Pool

Inception of Trading: February 2006

Aggregate Gross Capital Subscriptions as of December 31, 2006: $732,524,834

Net Asset Value as of December 31, 2006: $711,927,571

Net Asset Value per Share as of December 31, 2006: $24.55

Worst Monthly Drawdown: (4.70)% (12/06)

Worst Peak-to-Valley Drawdown: (7.14)% (07/06 – 09/06)


Monthly Rate of Return		2006(%)
January
February		(4.66)%
March		3.63%
April		6.51%
May		(0.42)%
June		(0.29)%
July		1.65%
August		(2.71)%
September		(4.54)%
October		1.21%
November		6.40%
December		(4.70)%

Compound Rate of Return		1.24% (11 months)

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

Footnotes to Performance Information

1. “Aggregate Gross Capital Subscriptions” is the aggregate of all amounts ever contributed to the pool, including redeemed investments.

2. “Net Asset Value” is the Net Asset Value of the pool as of December 31, 2006.

3. “Net Asset Value per Share” is the Net Asset Value of the pool divided by the total number of Shares outstanding as of December 31, 2006.

4. “Worst Monthly Drawdown” is the largest single month loss sustained since inception of trading. “Drawdown” as used in this section of the Prospectus means losses experienced by the relevant pool over the specified period and is calculated on a rate of return basis, i.e., dividing net performance by beginning equity. “Drawdown” is measured on the basis of monthly returns only, and does not reflect intra-month figures. “Month” is the month of the Worst Monthly Drawdown.

5. “Worst Peak-to-Valley Drawdown” is the largest percentage decline in the Net Asset Value per Share over the history of the pool. This need not be a continuous decline, but can be a series of positive and negative returns where the negative returns are larger than the positive returns. “Worst Peak-to-Valley Drawdown” represents the greatest percentage decline from any month-end Net Asset Value per Share that occurs without such month-end Net Asset Value per Share being equaled or exceeded as of a subsequent month-end. For example, if the Net Asset Value per Share of a particular pool declined by $1 in each of January and February, increased by $1 in March and declined again by $2 in April, a “peak-to-valley drawdown” analysis conducted as of the end of April would consider that “drawdown” to be still continuing and to be $3 in amount, whereas if the Net Asset Value per Share had increased by $2 in March, the January-February drawdown would have ended as of the end of February at the $2 level.”

7. The section entitled “DESCRIPTION OF THE DEUTSCHE BANK LIQUID COMMODITY INDEX – OPTIMUM YIELD EXCESS RETURN™ “ (beginning with “Cautionary Statement-Statistical Information” on page 34 through to the end of that section on page 45) of the Prospectus is hereby deleted and replaced, in its entirety, with the following:

Cautionary Statement–Statistical Information

Various statistical information is presented on the following pages, relating to the Closing Levels of the Index, on an annual and cumulative basis, including certain comparisons of the Index to other commodities indices. In reviewing such information, prospective investors should consider that:

• Changes in Closing Levels of the Index during any particular period or market cycle may be volatile. For example, the “worst peak-to-valley drawdown” of the Index, representing the greatest percentage decline from any month-end Closing Level, without such Closing Level being equaled or exceeded as of a subsequent month-end, is 45.09% and occurred during the period November 1996 through February 1999. The worst monthly drawdown of the Index during such period was 11.32%, and occurred in January 1991. See “The Risks You Face—(12) Price Volatility May Possibly Cause the Total Loss of Your Investment.”

• Neither the fees charged by the Fund nor the execution costs associated with establishing futures positions in the Index Commodities are incorporated into the Closing Levels of the Index. Accordingly, such Index Levels have not been reduced by the costs associated with an actual investment, such as the Fund, with an investment objective of tracking the Index.

• The Index was established in March 2003, and is independently calculated by Deutsche Bank AG London, the Index Sponsor. The Index calculation methodology and commodity futures contracts selection is the same before and after March 2003, as described above. Accordingly, the Closing Levels of the Index, terms of the Index methodology and Index Commodities, reflect an element of hindsight at the time the Index was established. See “The Risks You Face—(10) You May Not Rely on Past Performance or Index Results in Deciding Whether to Buy Shares” and “—(11) Fewer Representative Commodities May Result In Greater Index Volatility.”

WHILE THE FUND’S OBJECTIVE IS NOT TO GENERATE PROFIT THROUGH ACTIVE PORTFOLIO MANAGEMENT, BUT IS TO TRACK THE INDEX, BECAUSE THE INDEX WAS ESTABLISHED IN MARCH 2003, CERTAIN INFORMATION RELATING TO THE INDEX CLOSING LEVELS MAY BE CONSIDERED TO BE “HYPOTHETICAL.” HYPOTHETICAL INFORMATION MAY HAVE CERTAIN INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW.

NO REPRESENTATION IS BEING MADE THAT THE INDEX WILL OR IS LIKELY TO ACHIEVE ANNUAL OR CUMULATIVE CLOSING LEVELS CONSISTENT WITH OR SIMILAR TO THOSE SET FORTH HEREIN. SIMILARLY, NO REPRESENTATION IS BEING MADE THAT THE FUND WILL GENERATE PROFITS OR LOSSES SIMILAR TO THE FUND’S PAST PERFORMANCE OR THE HISTORICAL ANNUAL OR CUMULATIVE CHANGES IN INDEX CLOSING LEVELS. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY INVESTMENT METHODOLOGIES, WHETHER ACTIVE OR PASSIVE.

ONE OF THE LIMITATIONS OF HYPOTHETICAL INFORMATION IS THAT IT IS GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. TO THE EXTENT THAT INFORMATION PRESENTED HEREIN RELATES TO THE PERIOD JANUARY 1988 THROUGH FEBRUARY 2003, THE INDEX CLOSING LEVELS REFLECT THE APPLICATION OF THE INDEX METHODOLOGY, AND SELECTION OF INDEX COMMODITIES, IN HINDSIGHT.

NO HYPOTHETICAL RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THERE ARE NUMEROUS FACTORS, INCLUDING

THOSE DESCRIBED UNDER “THE RISKS YOU FACE” HEREIN, RELATED TO THE COMMODITIES MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF THE FUND’S EFFORTS TO TRACK THE INDEX OVER TIME WHICH CANNOT BE, AND HAVE NOT BEEN, ACCOUNTED FOR IN THE PREPARATION OF THE INDEX INFORMATION SET FORTH ON THE FOLLOWING PAGES, ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL PERFORMANCE RESULTS FOR THE FUND. FURTHERMORE, THE INDEX INFORMATION DOES NOT INVOLVE FINANCIAL RISK OR ACCOUNT FOR THE IMPACT OF FEES AND COSTS ASSOCIATED WITH THE FUND.

THE MANAGING OWNER HAS HAD LIMITED EXPERIENCE IN TRADING ACTUAL ACCOUNTS FOR ITSELF OR FOR CLIENTS. BECAUSE THERE ARE LIMITED ACTUAL TRADING RESULTS TO COMPARE TO THE INDEX CLOSING LEVELS SET FORTH HEREIN, PROSPECTIVE INVESTORS SHOULD BE PARTICULARLY WARY OF PLACING UNDUE RELIANCE ON THE ANNUAL OR CUMULATIVE INDEX RESULTS.

[Remainder of page left blank intentionally.]

DEUTSCHE BANK LIQUID COMMODITY INDEX–OPTIMUM YIELD EXCESS RETURN™

CLOSING LEVELS TABLE


	Closing Level		Annual Index Changes³	Index Change Since Inception
	High¹	Low²	Annual Index Changes³	Index Change Since Inception
1988⁴	107.57	98.16	7.57%	7.57%
1989	135.79	105.76	26.23%	35.79%
1990	169.86	119.11	6.70%	44.88%
1991	144.04	123.18	-12.55%	26.70%
1992	137.23	123.21	-1.03%	25.40%
1993	128.41	111.84	-10.54%	12.17%
1994	123.95	109.43	8.97%	22.24%
1995	140.37	119.65	14.84%	40.37%
1996	192.37	133.50	37.04%	92.37%
1997	195.74	159.87	-16.89%	59.87%
1998	161.75	108.96	-30.81%	10.61%
1999	154.05	103.20	37.35%	51.92%
2000	204.93	149.06	18.25%	79.65%
2001	191.44	155.77	-11.08%	59.74%
2002	204.22	158.05	23.54%	97.35%
2003	251.09	189.28	25.57%	147.81%
2004	375.32	251.89	36.37%	237.94%
2005	454.02	331.84	27.83%	332.00%
2006⁵	525.05	432.56	11.49%	381.63%

THE FUND WILL TRADE WITH A VIEW TO TRACKING THE

DEUTSCHE BANK LIQUID COMMODITY INDEX–OPTIMUM YIELD EXCESS RETURN™

NEITHER THE PAST PERFORMANCE OF THE FUND NOR THE PRIOR INDEX LEVELS AND CHANGES, POSITIVE AND NEGATIVE, SHOULD BE TAKEN AS AN INDICATION OF THE FUND’S FUTURE PERFORMANCE.

Please refer to notes and legends that follow on page 39.

DEUTSCHE BANK LIQUID COMMODITY INDEX–OPTIMUM YIELD EXCESS RETURN™

INDEX COMMODITY WEIGHTS TABLE


	CL				HO				GC				AL				C				W
	High		Low		High		Low		High		Low		High		Low		High		Low		High		Low
1988⁴	36.4	%	34.8	%	19.9	%	20.0	%	8.8	%	10.1	%	12.7	%	12.4	%	11.2	%	11.4	%	10.9	%	11.3	%
1989	35.9	%	37.9	%	21.0	%	19.7	%	9.7	%	8.4	%	11.8	%	11.2	%	11.0	%	11.3	%	10.6	%	11.6	%
1990	44.1	%	34.1	%	24.0	%	19.5	%	7.4	%	9.6	%	9.9	%	12.3	%	8.1	%	13.8	%	6.5	%	10.7	%
1991	32.8	%	28.8	%	19.6	%	16.6	%	11.1	%	11.6	%	13.4	%	15.5	%	12.3	%	14.6	%	10.8	%	12.9	%
1992	32.8	%	33.4	%	20.4	%	19.6	%	9.2	%	10.4	%	13.2	%	13.3	%	11.7	%	11.8	%	12.8	%	11.6	%
1993	35.2	%	31.4	%	20.4	%	18.5	%	9.7	%	10.9	%	12.3	%	13.8	%	11.3	%	12.5	%	11.1	%	13.0	%
1994	30.8	%	29.9	%	18.8	%	17.7	%	9.5	%	11.1	%	19.4	%	16.2	%	9.1	%	12.5	%	12.5	%	12.7	%
1995	37.2	%	34.6	%	19.5	%	19.7	%	9.3	%	9.9	%	12.2	%	12.8	%	11.0	%	11.6	%	10.8	%	11.3	%
1996	37.5	%	36.4	%	20.1	%	19.6	%	9.1	%	10.1	%	12.4	%	12.0	%	10.1	%	11.2	%	10.8	%	10.7	%
1997	37.8	%	34.5	%	20.2	%	19.8	%	8.7	%	10.0	%	12.4	%	12.9	%	10.0	%	11.8	%	10.9	%	10.9	%
1998	34.0	%	32.9	%	19.9	%	19.3	%	10.4	%	11.0	%	12.6	%	13.2	%	11.9	%	12.2	%	11.2	%	11.4	%
1999	37.2	%	33.5	%	20.7	%	18.3	%	9.4	%	11.5	%	12.6	%	13.2	%	10.3	%	12.6	%	9.8	%	11.0	%
2000	44.5	%	36.2	%	26.3	%	20.0	%	6.5	%	9.4	%	8.9	%	13.3	%	6.9	%	10.8	%	6.9	%	10.3	%
2001	37.3	%	33.3	%	19.9	%	18.5	%	10.3	%	10.5	%	12.8	%	14.1	%	9.5	%	12.0	%	10.2	%	11.7	%
2002	38.7	%	34.2	%	19.9	%	18.8	%	9.2	%	10.6	%	10.3	%	13.8	%	10.7	%	11.2	%	11.1	%	11.5	%
2003	36.0	%	36.3	%	20.5	%	21.0	%	9.8	%	10.2	%	12.2	%	12.0	%	10.6	%	10.7	%	10.8	%	9.8	%
2004	46.4	%	35.4	%	25.5	%	19.9	%	6.8	%	9.5	%	9.2	%	12.6	%	5.9	%	11.4	%	6.2	%	11.1	%
2005	39.5	%	32.8	%	25.8	%	19.1	%	7.7	%	10.5	%	10.7	%	14.6	%	8.1	%	11.6	%	8.2	%	11.3	%
2006⁵	33.1	%	32.9	%	18.7	%	18.4	%	12.1	%	11.1	%	16.1	%	14.4	%	9.9	%	11.4	%	10.1	%	11.7	%

THE FUND WILL TRADE WITH A VIEW TO TRACKING THE

DEUTSCHE BANK LIQUID COMMODITY INDEX–OPTIMUM YIELD EXCESS RETURN™

NEITHER THE PAST PERFORMANCE OF THE FUND NOR THE PRIOR INDEX LEVELS AND CHANGES, POSITIVE AND NEGATIVE, SHOULD BE TAKEN AS AN INDICATION OF THE FUND’S FUTURE PERFORMANCE.

CL = Sweet Light Crude Oil

HO = Heating Oil

GC = Gold

AL = Aluminum

C = Corn

W = Wheat

Please refer to notes and legends that follow on page 39.

All Statistics from July 31, 1998 to December 31, 2006


VARIOUS STATISTICAL MEASURES	DBLCI-OYER™^6,7		DBLCI ER™^7,8		GSCI ER⁹		RICI ER¹⁰		DJ AIG ER¹¹
Annualized Change to Index Level¹²	17.1	%	14.7	%	7.5	%	12.5	%	7.5	%
Average rolling 3 month daily volatility¹³	17.6	%	21.6	%	22.0	%	16.7	%	14.7	%
Sharpe Ratio¹⁴	0.97		0.68		0.34		0.75		0.51
% of months with positive change	59	%	58	%	55	%	60	%	56	%
Average monthly positive change	4.7	%	5.6	%	5.6	%	4.2	%	3.8	%
Average monthly negative change	-3.3	%	-4.6	%	-5.2	%	-3.7	%	-3.3	%

ANNUALIZED INDEX LEVELS¹⁵	DBLCI- OYER™		DBLCI ER™		GSCI ER		RICI ER		DJ AIG ER
1 year	11.5	%	3.1	%	-19.1	%	-1.2	%	-2.7	%
3 year	24.8	%	14.0	%	4.4	%	11.2	%	7.2	%
5 year	24.7	%	19.1	%	12.1	%	18.9	%	13.3	%
7 year	17.9	%	12.7	%	7.3	%	12.1	%	8.8	%

NEITHER THE PAST PERFORMANCE OF THE FUND NOR THE PRIOR INDEX LEVELS AND CHANGES, POSITIVE AND NEGATIVE, SHOULD BE TAKEN AS AN INDICATION OF THE FUND’S FUTURE PERFORMANCE.

NO HYPOTHETICAL RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THERE ARE NUMEROUS FACTORS, INCLUDING THOSE DESCRIBED UNDER “THE RISKS YOU FACE” HEREIN, RELATED TO THE COMMODITIES MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF THE FUND’S EFFORTS TO TRACK THE INDEX OVER TIME WHICH CANNOT BE, AND HAVE NOT BEEN, ACCOUNTED FOR IN THE PREPARATION OF THE INDEX INFORMATION SET FORTH ON THE FOLLOWING PAGES, ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL PERFORMANCE RESULTS FOR THE FUND. FURTHERMORE, THE INDEX INFORMATION DOES NOT INVOLVE FINANCIAL RISK OR ACCOUNT FOR THE IMPACT OF FEES AND COSTS ASSOCIATED WITH THE FUND.

Please refer to notes and legends that follow on page 39.

LOGO

NEITHER THE PAST PERFORMANCE OF THE FUND NOR THE PRIOR INDEX LEVELS AND CHANGES, POSITIVE AND NEGATIVE,

SHOULD BE TAKEN AS AN INDICATION OF THE FUND’S FUTURE PERFORMANCE.

Each of DBLCI –OYER, DBLCI – ER, GSCI– ER, RICI– ER, and DJAIG– ER are indices and do not reflect actual trading.

Each of the indices are calculated on an excess return basis and does not reflect any fees or expenses.

MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF THE FUND’S EFFORTS TO TRACK THE INDEX OVER TIME WHICH CANNOT BE, AND HAVE NOT BEEN, ACCOUNTED FOR IN THE PREPARATION OF THE INDEX INFORMATION SET FORTH ON THE FOLLOWING PAGES, ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL PERFORMANCE RESULTS FOR THE FUND. FURTHERMORE, THE INDEX INFORMATION DOES NOT INVOLVE FINANCIAL RISK OR ACCOUNT FOR THE IMPACT OF FEES AND COSTS ASSOCIATED WITH THE FUND.

Please refer to notes and legends that follow on page 39.

LOGO

NEITHER THE PAST PERFORMANCE OF THE FUND NOR THE PRIOR INDEX LEVELS AND CHANGES, POSITIVE AND NEGATIVE, SHOULD BE TAKEN AS AN INDICATION OF THE FUND’S FUTURE PERFORMANCE.

Each of DBLCI –OYER, DBLCI – ER, GSCI– ER, RICI– ER, and DJAIG– ER are indices and do not reflect actual trading.

Each of the indices are calculated on an excess return basis and does not reflect any fees or expenses.

PREPARATION OF THE INDEX INFORMATION SET FORTH ON THE FOLLOWING PAGES, ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL PERFORMANCE RESULTS FOR THE FUND. FURTHERMORE, THE INDEX INFORMATION DOES NOT INVOLVE FINANCIAL RISK OR ACCOUNT FOR THE IMPACT OF FEES AND COSTS ASSOCIATED WITH THE FUND.

Please refer to notes and legends that follow on page 39.

NOTES AND LEGENDS:

1. “High” reflects the highest closing level of the Index during the applicable year.

2. “Low” reflects the lowest closing level of the Index during the applicable year.

3. “Annual Index Change” reflects the change to the Index level on an annual basis as of December 31 of each applicable year.

4. Closing levels as of inception on July 31, 1988.

5. Closing levels as of December 31, 2006.

6. “DBLCI–OYER^™” is the Deutsche Bank Liquid Commodity Index—Optimum Yield Excess Return^™. The DBLCI–OYER^™ is calculated on both an excess return basis and reflects an optimum yield. The excess return calculation is unfunded and reflects the change in market value of the underlying index commodities. Optimum yield enables the index to rollover to the futures contract which generates the highest ‘roll yield,’ rather than select a new future based on a fixed schedule (e.g. monthly). The result will tend to maximize the benefits of rolling in backwardated markets and minimize the loss from rolling in contangoed markets. The DBLCI^™ is intended to reflect the change in market value of the following commodities: Light, Sweet Crude Oil, Heating Oil, Aluminum, Gold, Corn and Wheat. The notional amounts of each index commodity included in this index are broadly in proportion to historical levels of the world’s production and stocks of the index commodities. The sponsor of the Index, or the Index Sponsor, is Deutsche Bank AG London. Deutsche Bank Liquid Commodity Index^™ is a trade mark of Deutsche Bank AG and is the subject of Community Trade Mark Number 3054996. Trade Mark applications in the United States are pending.

7. In the current interest rate environment, the total return on an investment in the Fund is expected to outperform the DBLCI–OYER^™ and underperform the DBLCI-TROY^™. The only difference between the DBLCI–OYER^™ and the DBLCI-OYTR^™ is that the DBLCI–OYER^™ does not include interest income from a hypothetical basket of fixed income securities while the DBLCI-OYTR^™ does include such a component. The difference between the DBLCI–OYER^™ and the DBLCI-OYTR^™ is attributable entirely to the hypothetical interest income from this hypothetical basket of fixed income securities. The Fund’s interest income from its holdings of fixed-income securities is expected to exceed the Fund’s fees and expenses, and the amount of such excess is expected to be distributed periodically. The market price of the Shares is expected closely to track the DBLCI–OYER^™. The total return on an investment in the Fund over any period is the sum of the capital appreciation or depreciation of the Shares over the period, plus the amount of any distributions during the period. Consequently, in the current interest rate environment, the Fund’s total return is expected to outperform the DBLCI–OYER^™ by the amount of the excess of its interest income over its fees and expenses but, as a result of the Fund’s fees and expenses, the total return on the Fund is expected to underperform the DBLCI-OYTR^™. If the Fund’s fees and expenses were to exceed the Fund’s interest income from its holdings of fixed income securities, the Fund would underperform the DBLCI–OYER^™.

8. “DBLCI– ER” is the Deutsche Bank Liquid Commodity Index—Excess Return^™.

9. “GSCI – ER” is the Goldman Sachs Commodity Index^® calculated on an excess return basis. The GSCI is designed to provide investors with a reliable and publicly available benchmark for investment in the commodity market. The GSCI is a composite index of commodity sector returns, representing an unleveraged, long-only investment in commodity futures that is broadly diversified across the spectrum of commodities. In turn, the GSCI provides investors with a representative and realistic picture of realizable returns attainable in the commodities markets.

10. “RICI – ER” is the Rogers International Commodity Index calculated on an excess return basis. RICI represents the value of a basket of commodities employed in the global economy, ranging from agricultural

products (such as wheat, corn and cotton) and energy products (including crude oil, gasoline and natural gas) to metals and minerals (including gold, silver, aluminum and lead). As of July 31, 1998, there were thirty-five different contracts represented in the Index. The value of each component is based on monthly closing prices of the corresponding futures and/or forward contracts, each of which is valued as part of a fixed-weight portfolio. The index was developed to be an effective measure of the price action of raw materials on a worldwide basis. The broad based representation of commodities contracts is intended to provide two important characteristics: The large number of contracts and underlying raw materials represents “diversification” and the global coverage of those contracts reflects the current state of international trade and commerce.

11. “DJ AIG – ER” is the Dow Jones—AIG Commodity Index^SM calculated on an excess return basis. The DJ-AIG is designed to be a highly liquid and diversified benchmark for the commodity futures market. The DJ-AIG is composed of futures contracts on 19 physical commodities. The DJ-AIG is composed of commodities traded on U.S. exchanges, with the exception of aluminum, nickel and zinc, which trade on the London Metal Exchange (LME). An Oversight Committee meets annually to determine the composition of the index in accordance with the rules established in the DJ-AIGCI Handbook. Committee members are drawn from the academic, financial and legal communities. The most recent Oversight Committee meeting took place in July 2005, with changes in index composition effective January 2006.

12. “Annualized Change to Index Level” reflects the change to the level of the applicable index on an annual basis as of December 31 of each applicable year.

13. “Average rolling 3 month daily volatility.” The daily volatility reflects the relative rate at which the price of the applicable index moves up and down, which is found by calculating the annualized standard deviation of the daily change in price. In turn, an average of this value is calculated on a 3 month rolling basis.

14. “Sharpe Ratio” compares the annualized rate of return minus the annualized risk-free rate of return to the annualized variability — often referred to as the “standard deviation” — of the monthly rates of return. A Sharpe Ratio of 1:1 or higher indicates that, according to the measures used in calculating the ratio, the rate of return achieved by a particular strategy has equaled or exceeded the risks assumed by such strategy. The risk-free rate of return that was used in calculating DBCLI-OYER was assumed to be 0% because the excess return calculation of DBCLI excludes interest earned on 3 month Treasury bills. (3 month Treasury bills are used to calculate the risk-free rate of return.)

15. “Annualized Index Levels” reflects the change to the level of the applicable index on an annual basis as of December 31 of each the applicable time period (e.g., 1 year, 3, 5 or 7 years).

ONE OF THE LIMITATIONS OF HYPOTHETICAL INFORMATION IS THAT IT IS GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. TO THE EXTENT THAT INFORMATION

PRESENTED HEREIN RELATES TO THE PERIOD JANUARY 1988 THROUGH FEBRUARY 2003, THE INDEX CLOSING LEVELS REFLECT THE APPLICATION OF THE INDEX METHODOLOGY, AND SELECTION OF INDEX COMMODITIES, IN HINDSIGHT.

ALTHOUGH THE INDEX SPONSOR WILL OBTAIN INFORMATION FOR INCLUSION IN OR FOR USE IN THE CALCULATION OF THE INDEX FROM SOURCE(S) WHICH THE INDEX SPONSOR CONSIDERS RELIABLE, THE INDEX SPONSOR WILL NOT INDEPENDENTLY VERIFY SUCH INFORMATION AND DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE INDEX OR ANY DATA INCLUDED THEREIN. THE INDEX SPONSOR WILL NOT BE LIABLE (WHETHER IN NEGLIGENCE OR OTHERWISE) TO ANY PERSON FOR ANY ERROR IN THE INDEX AND THE INDEX SPONSOR IS UNDER NO OBLIGATION TO ADVISE ANY PERSON OF ANY ERROR THEREIN.

UNLESS OTHERWISE SPECIFIED, NO TRANSACTION RELATING TO THE INDEX IS SPONSORED, ENDORSED, SOLD OR PROMOTED BY THE INDEX SPONSOR AND THE INDEX SPONSOR MAKES NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES AS TO (A) THE ADVISABILITY OF PURCHASING OR ASSUMING ANY RISK IN CONNECTION WITH ANY SUCH TRANSACTION, (B) THE LEVELS AT WHICH THE INDEX STANDS AT ANY PARTICULAR TIME ON ANY PARTICULAR DATE, (C) THE RESULTS TO BE OBTAINED BY THE ISSUER OF ANY SECURITY OR ANY COUNTERPARTY OR ANY SUCH ISSUER’S SECURITY HOLDERS OR CUSTOMERS OR ANY SUCH COUNTERPARTY’S CUSTOMERS OR COUNTERPARTIES OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX OR ANY DATA INCLUDED THEREIN IN CONNECTION WITH ANY LICENSED RIGHTS OR FOR ANY OTHER USE, OR (D) ANY OTHER MATTER. THE INDEX SPONSOR MAKES NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THE INDEX OR ANY DATA INCLUDED THEREIN.

WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE INDEX SPONSOR HAVE ANY LIABILITY (WHETHER IN NEGLIGENCE OR OTHERWISE) TO ANY PERSON FOR ANY DIRECT, INDIRECT, SPECIAL, PUNITIVE, CONSEQUENTIAL OR ANY OTHER DAMAGES (INCLUDING LOST PROFITS) EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.

[Remainder of page left blank intentionally.]

PERFORMANCE OF COMMODITY POOL OPERATED BY

THE MANAGING OWNER AND ITS AFFILIATES

General

The performance information included herein is presented in accordance with CFTC regulations. The Fund differs materially in certain respects from the following pool’s performance which is included herein. The following sets forth summary performance information for the one pool operated by the Managing Owner (other than the Fund) as of December 31, 2006.

The pool, the performance of which is summarized herein, is materially different in certain respects from the Fund and the past performance summary of such pool is generally not representative of how the Fund might perform in the future. This pool also has material differences from the Fund, such as different investment objectives and strategies, leverage, employment of short in addition to long positions and fee structures, among other variations. The performance record of this pool may give some general indication of the Managing Owner’s capabilities by indicating the past performance of other pools sponsored by the Managing Owner.

Effective as of January 5, 2007, the Managing Owner serves as the managing owner, commodity pool operator and commodity trading advisor of seven additional public commodity pools (PowerShares DB Energy Fund (DBE), PowerShares DB Oil Fund (DBO), PowerShares DB Precious Metals Fund (DBP), PowerShares DB Gold Fund (DGL), PowerShares DB Silver Fund (DBS), PowerShares DB Base Metals Fund (DBB), and PowerShares DB Agriculture Fund (DBA)). Because the performance information included herein is as of December 31, 2006, the performance of these seven funds has not been included herein.

All summary performance information is current as of December 31, 2006. Performance information is set forth, in accordance with CFTC Regulations since September 18, 2006 (inception with respect to PowerShares DB G10 Currency Harvest Fund). CFTC Regulations require inclusion of only performance information within the five most recent calendar years and year-to-date, or, if inception of the pool has been less than five years and year-to-date, then since inception.

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS, AND MATERIAL DIFFERENCES EXIST BETWEEN THE FUND AND THE POOL WHOSE PERFORMANCE IS SUMMARIZED HEREIN.

INVESTORS SHOULD NOTE THAT INTEREST INCOME MAY CONSTITUTE A SIGNIFICANT PORTION OF A COMMODITY POOL’S INCOME AND, IN CERTAIN INSTANCES, MAY GENERATE PROFITS WHERE THERE HAVE BEEN REALIZED AND UNREALIZED LOSSES FROM COMMODITY TRADING.


Name of Pool:		PowerShares DB G10 Currency Harvest Fund
Type of Pool:		Public, Exchange-Listed Commodity Pool
Date of Inception of Trading:		September 2006
Aggregate Gross Capital Subscriptions as of December 31, 2006:		$126,666,090
Net Asset Value as of December 31, 2006:		$129,220,919
Net Asset Value per Share as of December 31, 2006:		$25.84
Worst Monthly Drawdown:		(1.30%) November 2006
Worst Peak-to-Valley Drawdown:		(1.30%) November 2006


Monthly Rate of Return		2006(%)
January		—
February		—
March		—
April		—
May		—
June		—
July		—
August		—
September		(0.24)%
October		1.92%
November		(1.30)%
December		2.99%

Compound Rate of Return		3.36% (3¹/2 months)

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

See accompanying footnotes to performance information.

Footnotes to Performance Information

1. “Aggregate Gross Capital Subscriptions” is the aggregate of all amounts ever contributed to the relevant pool, including investors who subsequently redeemed their investments.

2. “Net Asset Value” is the net asset value of each pool as of December 31, 2006.

3. “Net Asset Value per Share” is the Net Asset Value of the relevant pool divided by the total number of Shares outstanding with respect to such pool as of December 31, 2006.

5. “Worst Peak-to-Valley Drawdown” is the largest percentage decline in the Net Asset Value per Share over the history of the relevant pool. This need not be a continuous decline, but can be a series of positive and negative returns where the negative returns are larger than the positive returns. “Worst Peak-to-Valley Drawdown” represents the greatest percentage decline from any month-end Net Asset Value per Share that occurs without such month-end Net Asset Value per Share being equaled or exceeded as of a subsequent month-end. For example, if the Net Asset Value per Share of a particular pool declined by $1 in each of January and February, increased by $1 in March and declined again by $2 in April, a “peak-to-valley drawdown” analysis conducted as of the end of April would consider that “drawdown” to be still continuing and to be $3 in amount, whereas if the Net Asset Value per Share had increased by $2 in March, the January-February drawdown would have ended as of the end of February at the $2 level.”

8. The biography of Mr. Gregory Collett on page 58 is hereby deleted and replaced, in its entirety, by the following:

“Gregory Collett served as Vice President and Counsel in the Legal Department of Deutsche Bank AG from October 2002 through June 2006, where he worked primarily with the Commodities Group to build Deutsche Bank’s power and gas trading and commodity funds businesses. Mr. Collett joined the Global Currency & Commodities Complex Risk Group in June 2006 with responsibility for providing currency and commodity based investor solutions to the DB sales force in the Americas and serves as a principal, the Chief Operating Officer and principal financial officer of the Managing Owner. Mr. Collett also serves as an associated person of Deutsche Bank Securities Inc. From March 2000 through October 2002, Mr. Collett was an associate with the law firm of Sidley Austin LLP in New York, and prior to that he was an attorney-advisor with the Commodity Futures Trading Commission from October 1998 to February 2000. Since 2003, Mr. Collett has served on the Futures Industry Association’s Law & Compliance Executive Committee. Mr. Collett received his J.D. from George Washington University Law School in 1997 and his B.A. from Colgate University in 1993.”

9. The last paragraph under the sub-heading “Tax-Exempt Organizations” on page 81 of the Prospectus is hereby deleted and replaced, in its entirety, by the following:

“All of the income realized by the Master Fund is expected to be short-term or long-term capital gain income, interest income or other passive investment income of the type specifically exempt from UBTI as discussed above. Neither the Fund nor the Master Fund will borrow funds for the purpose of acquiring or holding any investments or otherwise incur “acquisition indebtedness” with respect to such investments. Therefore, a tax-exempt entity purchasing Shares would not incur any UBTI by reason of its investment in the Shares or upon sale of such Shares provided that such tax-exempt entity does not borrow funds for the purpose of investing in the Shares.”