5. DERIVATIVE INSTRUMENTS

9 Months Ended

Sep. 30, 2015

The Partnership engages in the speculative trading of forward currency contracts, options on futures contracts, and futures contracts in currencies, financials and a wide range of commodities, among others (collectively "derivatives") for the purpose of achieving capital appreciation. Since the derivatives held or sold by the Partnership are for speculative trading purposes, the derivative instruments are not designated as hedging instruments as defined in ASC Topic 815, Derivatives and Hedging.

Under provisions of ASC Topic 815, Derivatives and Hedging, entities are required to recognize all derivative instruments as either assets or liabilities at fair value in the Statement of Financial Condition. Investments in futures contracts are reported in the Statements of Financial Condition as "Net unrealized gains on open contracts" or "Net unrealized (losses) on open contracts," as applicable.

The Partnership's derivatives held at September 30, 2015 and December 31, 2014 are subject to agreements similar to master netting agreements with the Partnership's brokers which grant the Partnership the right to offset recognized assets and liabilities if certain conditions exist. The following tables present gross amounts of assets and liabilities which are offset in the Statements of Financial Condition.

Offsetting of Derivative Assets and Liabilities

As of September 30, 2015

Gross Amounts

Net Amounts

Offset in the

Presented in the

Gross Amounts

Statement of

of Recognized

Financial

Assets

Condition

Assets

Futures Contracts⁽¹⁾

ADM Investor Services, Inc.

868,240

(762,144

)

106,096

Gross Amounts

Net Amounts

Offset in the

Presented in the

Gross Amounts

Statement of

of Recognized

Financial

Liabilities

Condition

Liabilities

Futures Contracts⁽¹⁾

ADM Investor Services, Inc.

(762,144

)

762,144

Offsetting of Derivative Assets and Liabilities

As of December 31, 2014

Gross Amounts

Net Amounts

Offset in the

Presented in the

Gross Amounts

Statement of

of Recognized

Financial

Assets

Condition

Assets

Futures Contracts⁽¹⁾

ADM Investor Services, Inc.

432,423

(27,231

)

405,192

Options on futures contracts⁽¹⁾

ADM Investor Services, Inc.

70,200

Gross Amounts

Net Amounts

Offset in the

Presented in the

Gross Amounts

Statement of

of Recognized

Financial

Liabilities

Condition

Liabilities

Futures Contracts⁽¹⁾

ADM Investor Services, Inc.

(27,231

)

27,231

Options on futures contracts⁽¹⁾

ADM Investor Services, Inc.

(29,200

)

(29,200

)

___________________________________________________

^{(1)See Note
4. for the fair value for each type of contract within the category.}

Within the Statements of Financial Condition, the fair value of futures contracts is included in net unrealized gain on open futures contracts and the fair value of options on futures contracts is included in purchased options on futures contracts and written options on futures contracts.

The cash held at each counterparty at September 30, 2015 and December 31, 2014 exceeds the net derivatives liability, if any, at such counterparty. Realized gains and losses, as well as any change in net unrealized gains or losses on open contracts from the preceding period, are recognized as part of the Partnership's trading profits and losses in the Statements of Income (Loss).

The Partnership's trading results and information related to the volume of the Partnership's derivative activity by market sector were as follows:


	For the three months ended September 30, 2015
	Net Realized				Change in				Net				Number of
	Gains				Net Unrealized				Trading				Closed
Futures contracts	(Losses)				Gains (Losses)				Profits (Losses)				Contracts
Commodities		$	20,118			$	(25,209	)		$	(5,091	)	14,950
Currencies			(10,479	)			4,274				(6,205	)	452
Energy			267,930				35,979				303,909		3,940
Financials			(78,044	)			30,169				(47,875	)	334
Metals			20,670				(6,316	)			14,354		700
Stock indices			(11,213	)			(166	)			(11,379	)	138
Total futures contracts			208,982				38,731				247,713		20,514
Options on futures contracts
Commodities			(10,519	)			5,950				(4,569	)	94
Currencies			(9,425	)			-				(9,425	)	132
Energy			(34,070	)			7,980				(26,090	)	70
Financials			(1,406	)			(156	)			(1,562	)	20
Stock indices			15,645				(4,375	)			11,270		120

Total options on futures contracts			(39,775	)			9,399				(30,376	)	436

Total gain from derivatives trading		$	169,207			$	48,130			$	217,337

	For the nine months ended September 30, 2015
	Net Realized				Change in				Net				Number of
	Gains				Net Unrealized				Trading				Closed
Futures contracts	(Losses)				Gains (Losses)				Profits (Losses)				Contracts
Commodities		$	73,487			$	4,393			$	77,880		19,138
Currencies			25,108				(52,056	)			(26,948	)	1,730
Energy			(374,570	)			(131,305	)			(505,875	)	5,748
Financials			(117,867	)			(39,956	)			(157,823	)	1,600
Metals			(21,438	)			(42,271	)			(63,709	)	1,182
Stock indices			(25,019	)			(37,901	)			(62,920	)	1,492
Total futures contracts			(440,299	)			(299,096	)			(739,395	)	30,890
Options on futures contracts
Commodities			(20,940	)			-				(20,940	)	914
Currencies			(9,473	)			-				(9,473	)	998
Energy			11,320				54,600				65,920		1,332
Financials			90,282				-				90,282		736
Stock indices			27,798				-				27,798		404

Total options on futures contracts			98,987				54,600				153,587		4,384

Total (loss) from derivatives trading		$	(341,312	)		$	(244,496	)		$	(585,808	)

	For the three months ended September 30, 2014
	Net Realized				Change in				Net				Number of
	Gains				Net Unrealized				Trading				Closed
Futures contracts	(Losses)				Gains (Losses)				Profits				Contracts
Commodities		$	95,230			$	129,672			$	224,902				1,698
Currencies			363,033				95,411				458,444				2,366
Energy			(20,378	)			87,495				67,117				758
Financials			81,960				(3,999	)			77,961				3,886
Metals			77,888				137,548				215,436				494
Stock indices			132,163				(876	)			131,287				4,164

Total gain from derivatives trading		$	729,896			$	445,251			$	1,175,147				13,366

	For the nine months ended September 30, 2014
	Net Realized				Change in				Net				Number of
	Gains				Net Unrealized				Trading				Closed
Futures contracts	(Losses)				Gains (Losses)				Profits (Losses)				Contracts
Commodities		$	290,298			$	141,589			$	431,887				5,504
Currencies			301,558				41,238				342,796				5,560
Energy			(100,509	)			42,098				(58,411	)			2,140
Financials			230,537				(37,163	)			193,374				13,344
Metals			(96,983	)			109,032				12,049				1,896
Stock indices			(10,921	)			(41,543	)			(52,464	)			11,022
Total futures contracts			613,980				255,251				869,231				39,466

													Notional Value
													of Contracts
													Closed
Forward currency contracts			269				-				269			$	156,156

Total gain from derivatives trading		$	614,249			$	255,251			$	869,500

The number of contracts closed for futures and options on futures contracts represents the number of contract half turns during the three months and nine months ended September 30, 2015 and 2014. The notional value of contracts closed for forward currency contracts represents the U.S. dollar notional value of forward currency contracts closed during the three and nine months ended September 30, 2014.

A. Market Risk

The Partnership engages in the speculative trading of futures contracts, options on futures contracts, and forward currency contracts. Derivative financial instruments involve varying degrees of off-balance sheet market risk whereby changes in the level of volatility of interest rates, foreign currency exchange rates or market values of the underlying financial instruments or commodities may result in cash settlements in excess of the amounts recognized in the Statements of Financial Condition. The Partnership's exposure to market risk is directly influenced by a number of factors, including the volatility of the markets in which the financial instruments are traded and the liquidity of those markets.

B. Fair Value

The derivative financial instruments used in the Partnership's trading activities are reported at fair value with the resulting unrealized gains (losses) recorded in the Statements of Financial Condition and the related trading profits (losses) reflected in "trading profits (losses)" in the Statements of Income (Loss). Open contracts generally mature within 90 days; as of September 30, 2015 and December 31, 2014, the latest maturity dates for open contracts are July 2016 and March 2015, respectively.

Credit Risk

Futures are contracts for delayed delivery of financial interests in which the seller agrees to make delivery at a specified future date of a specified financial instrument at a specified price or yield. Options on futures are contracts giving its owner the right, but not the obligation, to buy (call) or sell (put) a specified number of futures contracts at a fixed strike price either during a specified period or on a specified date. Risk on futures and options on futures contracts arises from changes in the fair value of the underlying instruments. The purchase and sale of futures and options on futures contracts requires certain margin deposits with the brokers. Additional deposits may be necessary for any loss on contract fair value. The Commodity Exchange Act requires a broker to segregate all customer transactions and assets from such broker's proprietary activities. A customer's cash and other property (for example, U.S. Treasury bills) deposited with a broker are considered commingled with all other customer funds subject to the broker's segregation requirements. In the event of a broker's insolvency, recovery may be limited to a pro rata share of segregated funds available. It is possible that the recovered amount could be less than total cash and other property deposited with such brokers ("counterparties"). The Partnership's counterparties are major brokerage firms and banks located in the United States, or their foreign affiliates. Credit risk due to counterparty nonperformance associated with futures contracts and options on futures contracts is reflected in the cash on deposit with brokers and the gross amounts of recognized assets held by such counterparties, if any, reflected above. The Partnership also trades forward currency contracts in unregulated markets between principals and assumes the risk of loss from counterparty nonperformance.

The Partnership has a substantial portion of its assets on deposit with brokers and other financial institutions in connection with its trading of derivative contracts and its cash management activities. Assets deposited with brokers and other financial institutions in connection with the Partnership's trading of derivative contracts are partially restricted due to deposit or margin requirements. In the event of a financial institution's insolvency, recovery of Partnership assets on deposit may be limited to account insurance or other protection afforded such deposits.

Risk Monitoring

Due to the speculative nature of the Partnership's derivatives trading, the Partnership is subject to the risk of substantial losses from derivatives trading. The General Partner actively assesses, manages, and monitors risk exposure on derivatives on a contract basis, a market sector basis, and on an overall basis in accordance with established risk parameters. The Limited Partners bear the risk of loss only to the extent of the fair value of their respective investments and, in certain specific circumstances, distributions and redemptions received.

BRIDGETON TACTICAL ADVISORS FUND, LP 10-Q/A