UNITEDTable STATESof Contents

(aTable Delawareof Business Trust) Contents

Item 1.Table Businessof Contents

EffectiveTable July 1, 2003, PSI changed its name to Prudential Equity Group, Inc. (“PEG”). PEG remained an indirectly wholly-owned subsidiary of Prudential. PEG was a registered broker-dealer and a member of the NASD and all major securities exchanges and conducted the equity research, domestic and international equity sales and trading operations, and commodity brokerage and derivative operations it had previously conducted as PSI until December 31, 2003. As part of the process of reorganizing its business structure, Prudential Securities Group Inc. (“PSG”), the direct parent of PEG and a wholly-owned subsidiary of Prudential, transferred the commodity brokerage, commodity clearing and derivative operations previously performed by PEG to another PSG indirectly wholly-owned subsidiary, Prudential Financial Derivatives, LLC (“PFD”) effective January 1, 2004. Like PEG, PFD is registered as a futures commission merchant under the Commodity Exchange Act and is a member of the National Futures Association. On April 1, 2004 PEG transferred the ownership of the Managing Owner and PFD Holdings, LLC, the direct parent of PFD to PSG. Contents

4Table of Contents

TradersTable that utilize fundamental trading strategies attempt to examine factors external to the trading market that affect the supply and demand for a particular futures and forward contracts in order to predict future prices. Such analysis may not result in profitable trading because the analyst may not have knowledge of all factors affecting supply and demand, prices may often be affected by unrelated factors, and purely fundamental analysis may not enable the trader to determine quickly that previous trading decisions were incorrect. In addition, because of the breadth of fundamental data that exists, a fundamental trader may not be able to follow developments in all such data, but instead may specialize in analyzing a narrow set of data, requiring trading in fewer markets. Consequently, a fundamental trader may have less flexibility in adverse markets to trade other futures and forward markets than traders that do not limit the number of markets traded as a result of a specialized focus. Contents

Historically,Table managed futures generally have been non-correlated to the performance of other asset classes such as stocks and bonds. Non-correlation means that there is no statistically valid relationship between the past performance of futures and forward contracts on the one hand and stocks or bonds on the other hand. Non-correlation should not be confused with negative correlation, where the performance would be exactly opposite between two asset classes. Because of this non-correlation, no Trust can be expected to be automatically profitable during unfavorable periods for the stock market, or vice-versa. The futures and forward markets are fundamentally different from the securities markets in that for every gain in futures and forward trading, there is an equal and offsetting loss. If the Trust does not perform in a manner non-correlated with the general financial markets or does not perform successfully, you will obtain no diversification benefits by investing in the Units of such Trust and such Trust may have no gains to offset your losses from other investments. Contents

ThereTable can be no assurance that the tax returns of each Trust will not be audited by the IRS. If such an audit results in an adjustment, Unitholders of such Trust could themselves be audited as well as being required to pay additional taxes, interest and possibly penalties. Contents

Item 1B.Table Unresolvedof Staff Comments Contents

AsTable of March 10, 2005, there were 426 holders of record owning 58,816.728 Interests, which includes 604 general interests. Contents

EuropeanTable equity markets out-performed the U.S. equity markets by a significant margin for much of the year, with the fourth quarter being particularly strong. Among the three major indices, the German DAX gained 27%, the French CAC 40 gained 23% and the British FTSE 100 was up 17%. Asian equities were stronger than European equities, as South Korea’s Kospi increased 54% and Japan’s Nikkei rose 40%. The Nikkei finished the year with seven consecutive monthly gains. Australia’s All Ordinaries increased 17%. Contents

InterestTable incomeof is earned on the equity balances held at the broker and, therefore, varies monthly according to interest rates, trading performance and redemptions. Interest income increased by approximately $86,000 for the year ended December 31, 2005 as compared to 2004. The increase was primarily due to increasing short term interest rates. Interest income was comparable for the years ended December 31, 2004 and 2003. Contents

ThereTable are no officers of the Registrant. The Registrant is managed by the Managing Owner. Contents

Ms. EstherTable Eckerling Goodman (born 1952) has been a principal, associated person and NFA associate member of the Managing Owner since May 12, 1988, July 17, 1986 and July 17, 1986, respectively. She joined the Managing Owner in July 1986 and is its Chief Operating Officer and Senior Executive Vice President. Ms. Goodman has been involved in the futures industry since 1974. From 1974 through 1976, she was employed by Conti-Commodity Services, Inc. and ACLI Commodity Services, Inc., in the areas of hedging, speculative trading and tax arbitrage. In 1976, Ms. Goodman joined Loeb Rhoades & Company, Inc. where she was responsible for developing and managing a managed futures program which, in 1979, became the trading system for Westchester Commodity Management, an independent commodity-trading advisor of which Ms. Goodman was a founder and principal. From 1983 through mid-1986, Ms. Goodman was employed as a marketing executive at Commodities Corp. (USA) of Princeton, New Jersey. Ms. Goodman was a Director of the Managed Futures Trade Association from 1987 to 1991 and a Director of its successor organization, the Managed Futures Association, from 1991 to 1995 (now the Managed Funds Association). Ms. Goodman graduated from Stanford University with a B.A. degree in psychology in 1974. Contents

AuditTable Committeeof Financial Expert Contents

ReferenceTable isof made to Notes 1, 3 and 4 to the financial statements in the Registrant’s 2005 Annual Report, which is filed as an exhibit hereto, which identify the related parties and discuss the services provided by these parties and the amounts paid or payable for their services. Contents

19Table of Contents

~~SECURITIES~~UNITED ~~AND~~STATES ~~EXCHANGE COMMISSION~~

~~Washington,~~SECURITIES ~~D.C.~~AND ~~20549~~EXCHANGE COMMISSION

~~FORM~~Washington, ~~10-K~~D.C. 20549

~~(Mark~~FORM ~~One)~~10-K

~~x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15~~(dMark One) ~~OF THE SECURITIES EXCHANGE ACT OF 1934~~

~~For~~x ~~the~~ANNUAL ~~fiscal~~REPORT ~~year~~PURSUANT ~~ended~~TO ~~December 31,~~SECTION ~~2005~~13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

ORFor the fiscal year ended December 31, 2008

~~¨ TRANSITION REPORT PURSUANT TO SECTION 13~~ OR ~~15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

~~For~~¨ ~~the~~TRANSITION ~~transition~~REPORT ~~period~~PURSUANT ~~from to~~ TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~Commission~~For ~~file~~the ~~number~~transition ~~0-23885~~period from to

~~FUTURES~~Commission ~~STRATEGIC~~file ~~TRUST~~ number 0-23885

~~(Exact~~FUTURES ~~name~~STRATEGIC ofTRUST ~~Registrant as specified in its charter)~~

Delaware		13-7075398
(State or other Jurisdiction of Incorporation or organization)		(I.R.S. Employer Identification No.)
900 King Street, Suite 100, Rye Brook, New York		10573
(Address of principal executive offices)		(Zip Code)

(Exact name of Registrant as specified in its charter)

Registrant’s telephone number, including area code: (914) 307-7000

Delaware

13-7075398

State or other jurisdiction of

incorporation or organization

(I.R.S. Employer

Identification No.)

Securities registered pursuant to Section 12(b) of the Act:


900 King Street, Suite 100, Rye Brook, New York		10573
(Address of principal executive offices)		(Zip Code)

~~None~~Registrant’s telephone number, including area code: (914) 307-7000

Securities registered pursuant to Section 12(gb) of the Act:

~~Limited~~None ~~Interests~~

Securities registered pursuant to Section 12(~~Title~~g) of ~~class)~~the Act:

~~Indicate~~Limited byInterests ~~check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No x~~

~~Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15~~(d)Title of ~~the Act. Yes ¨ No x~~class)

Indicate by check mark ~~whether~~if ~~the~~ Registrant ~~(1) has~~is ~~filed~~a ~~all~~well-known ~~reports~~seasoned ~~required~~issuer, toas bedefined ~~filed~~in byRule ~~Section 13~~405 ~~or 15(d)~~ of the Securities ~~Exchange~~ Act ~~of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days~~. Yes x¨ No ¨ x

Indicate by check mark if ~~disclosure~~Registrant ~~of delinquent filers pursuant to Item 405 of Regulation S-K~~ is not required ~~contained~~to ~~herein,~~file ~~and~~reports ~~will~~pursuant ~~not be contained,~~ to ~~the~~Section 13 ~~best of Registrant’s knowledge, in definitive proxy~~ or ~~information~~Section 15(d) ~~statements incorporated by reference in Part III~~ of ~~this~~the ~~Form 10-K or any amendment to this Form 10-K~~Act. Yes ¨ No x

Indicate by check mark whether ~~the~~Registrant ~~registrant~~(1) has isfiled aall ~~large~~reports ~~accelerated~~required ~~filer,~~to anbe ~~accelerated~~filed ~~filer,~~by Section 13 or a15(d) ~~non-accelerated~~of ~~filer.~~the ~~See~~Securities ~~definition~~Exchange Act of ~~“accelerated filer~~1934 ~~and~~during ~~large~~the ~~accelerated~~preceding ~~filer”~~12 inmonths ~~Rule~~(or ~~12b-2~~for ofsuch ~~the~~shorter ~~Exchange~~period ~~Act.~~that ~~(Check~~Registrant ~~one~~was required to file such reports):, and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

~~Large~~Indicate ~~accelerated~~by ~~filer~~check ¨mark ~~Accelerated~~if ~~filer~~disclosure ¨of delinquent ~~Non~~filers pursuant to Item 405 of Regulation S-~~accelerated~~K ~~filer~~is xnot contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K ¨

Indicate by check mark whether the ~~Registrant~~registrant is a ~~shell~~large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting company. ~~(ad~~See ~~defined~~definition of “accelerated filer and large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act). ~~Yes ¨ No x~~ (Check one):

~~DOCUMENTS~~Large ~~INCORPORATED~~accelerated BYfiler ~~REFERENCE~~¨ Accelerated filer ¨ Non-accelerated filer x Smaller Reporting Company ¨

~~Annual~~Indicate ~~Report~~by tocheck ~~Interest~~mark ~~holders~~whether ~~for~~Registrant ~~the year ended December 31, 2005~~ is ~~incorporated~~a byshell ~~reference~~company ~~into~~(as ~~Parts~~defined IIin ~~and~~Rule IV12b-2 of ~~this~~the ~~Annual~~Exchange Act). Yes ¨ No x ~~Report on Form 10-K~~

~~FUTURES~~The ~~STRATEGIC~~value ~~TRUST~~of Limited Interests in the Registrant as of June 30, 2008 is $4,015,472.

~~TABLE~~DOCUMENTS OFINCORPORATED ~~CONTENTS~~BY REFERENCE

		PAGE
PART I
Item 1.	Business	3
Item 1A.	Risk Factors	5
Item 1B.	Unresolved Staff Comments	9
Item 2.	Properties	9
Item 3.	Legal Proceedings	9
Item 4.	Submission of Matters to a Vote of Interest Holders	9
PART II
Item 5.	Market for the Registrant’s Interests, Related Interest Holder Matters and Issuer Purchases of Equity Securities	9
Item 6.	Selected Financial Data	10
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	13
Item 8.	Financial Statements and Supplementary Data	13
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	13
Item 9A.	Controls and Procedures	14
Item 9B.	Other Information	14
PART III
Item 10.	Directors and Executive Officers of the Registrant	14
Item 11.	Executive Compensation	17
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Interest Holder Matters	17
Item 13.	Certain Relationships and Related Transactions	17
Item 14.	Principal Accounting Fees and Services	18
PART IV
Item 15.	Exhibits, Financial Statement Schedules, and Reports on Form 8-K	18
	Financial Statements and Financial Statement Schedules
	Exhibits
	Reports on Form 8-K
SIGNATURES

Annual Report to Unitholders for the year ended December 31, 2008 is incorporated by reference into Parts II and IV of this Annual Report on Form 10-K

2[Remainder of page intentionally left blank]

~~PART~~2 I

~~General~~FUTURES STRATEGIC TRUST

~~Futures Strategic Trust, formerly known as Prudential Securities Strategic Trust,~~ (~~the~~a ~~“Registrant” or the “Trust”) was organized under the~~ Delaware ~~Statutory~~Business Trust Act on October 16, 1995 and commenced trading operations on May 1, 1996. The Registrant will terminate on December 31, 2015 unless terminated sooner as provided in the Third Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”). ~~The Registrant was formed to engage in the speculative trading of commodity futures, forward and options contracts. The trustee of the Registrant is Wilmington Trust Company.~~

OnTABLE ~~May 1,~~OF ~~1996,~~CONTENTS the Registrant completed its initial offering with gross proceeds of $12,686,200 from the sale of 125,352 limited interests and 1,510 general interests (collectively, the “Interests”). General interests were sold exclusively to the Managing Owner. Additional Interests were offered monthly at the then current net asset value per Interest until the continuous offering period expired on January 31, 1998. Additional contributions raised during the continuous offering period resulted in additional proceeds to the Registrant of $51,242,700.

The Registrant is engaged solely in the business of commodity futures, forward and options trading; therefore, presentation of industry segment information is not applicable.


		PAGE
PART I

Item 1.	Business	4
Item 1A.	Risk Factors	5
Item 1B.	Unresolved Staff Comments	10
Item 2.	Properties	10
Item 3.	Legal Proceedings	10
Item 4.	Submission of Matters to a Vote of Security Holders	10

PART II

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	10
Item 6.	Selected Financial Data	11
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operation	11
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 8.	Financial Statements and Supplementary Data	21
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	21
Item 9A.	Controls and Procedures	21
Item 9B.	Other Information	22

PART III

Item 10.	Directors, Executive Officers and Corporate Governance	22
Item 11.	Executive Compensation	26
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	26
Item 13.	Certain Relationships and Related Transactions, and Director Independence	26
Item 14.	Principal Accounting Fees and Services	26

PART IV

Item 15.	Exhibits, Financial Statement Schedules	27
	Financial Statements and Financial Statement Schedules	27
	Exhibits	27
	Reports on Form 8-K	29

SIGNATURES		78

On3 July 1, 2003, Prudential Financial, Inc. (“Prudential”) and Wachovia Corp. (“Wachovia”) combined their separate retail securities brokerage and clearing businesses under a new holding company named Wachovia/Prudential Financial Advisors, LLC (“WPFA”), owned 62% by Wachovia and 38% by Prudential. As a result, the retail brokerage operations of Prudential Securities Incorporated (“PSI”) were contributed to Wachovia Securities, LLC (“Wachovia Securities”). Wachovia Securities is wholly-owned by WPFA and is a registered broker-dealer and a member of the National Association of Securities Dealers, Inc. (“NASD”) and all major securities exchanges. The Trust and its Managing Owner, Prudential Securities Futures Management Inc., entered into a service agreement with Wachovia Securities, effective July 1, 2003. Pursuant to this agreement, Wachovia Securities agreed to provide certain enumerated services to accounts of the limited interest owners carried at Wachovia.

OnPART ~~June 30,~~I 2004, PSG and Preferred Investment Solutions Corp., formerly Kenmar Advisory Corp. (“Preferred”), entered into a Stock Purchase Agreement, pursuant to which PSG would sell, and Preferred would buy, all of the capital stock of Prudential Securities Futures Management Inc. (the then current Managing Owner of the Trust) and another commodity pool operator owned by PSG. In connection with the transaction, Prudential Securities Futures Management Inc. solicited proxies seeking approval from the Trust Interest holders for (i) the sale of the stock of Prudential Securities Futures Management Inc. to Preferred; (ii) the concomitant approval of Preferred as the new Managing Owner of the Trust; and (iii) the approval of certain amendments to the Declaration of the Trust and Trust Agreement of the Trust. A Report on Form 8-K describing the transaction was filed with the Securities and Exchange Commission on July 1, 2004 and the definitive proxies were filed with the Securities and Exchange Commission on July 20, 2004.

AsItem ~~of October~~ 1~~, 2004, Preferred acquired from PSG all of the outstanding stock of Prudential Securities Futures Management Inc~~. ~~Immediately~~ after such acquisition, Prudential Securities Futures Management Inc. was merged with and into Preferred. Accordingly, as of October 1, 2004 all of the board of directors and officers of Prudential Securities Futures Management Inc. resigned. Following Preferred’s acquisition of Prudential Securities Futures Management Inc. and its merger with and into Preferred, Preferred became the successor Managing Owner of the Trust. Business

~~Managing~~General ~~Owner and its Affiliates~~

~~The~~Futures ~~term~~Strategic ~~Managing~~Trust, ~~Owner~~(“Registrant”) was organized under the Delaware Statutory Trust Act on October 16, as1995 ~~used~~and commenced trading operations on ~~herein~~May 1, ~~refers~~1996. ~~either~~Registrant towill ~~Prudential~~terminate ~~Securities~~on ~~Futures~~December 31, ~~Management~~2020 ~~Inc~~unless terminated sooner as provided in the Fourth Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”). orRegistrant ~~Preferred,~~was ~~depending~~formed ~~upon~~to engage in the ~~applicable~~speculative ~~period~~trading ~~discussed~~of commodity futures, forward and options contracts. The trustee of Registrant is Wilmington Trust Company.

~~The Managing Owner is~~Registrant ~~required~~is toengaged ~~maintain~~solely atin ~~least~~the abusiness 1%of ~~interest~~commodity infutures, ~~the~~forward ~~Trust~~and sooptions ~~long~~trading; astherefore, itpresentation isof ~~acting~~industry assegment ~~the~~information ~~Managing~~is ~~Owner~~not applicable.

3Managing Owner and its Affiliates

~~The~~Preferred ~~Trading~~Investment ~~Managers~~Solutions Corp. (“Preferred” or the “Managing Owner”) has been the managing owner of Registrant since October 1, 2004.

AtEffective inception of the Registrant’s trading activities, Willowbridge Associates Inc. (“Willowbridge”) made all the Registrant’s commodity trading decisions. During July 1998, Willowbridge ceased trading approximately 50% of the Registrant’s assets and, during August 1998, these assets were reallocated to Bridgewater Associates, Inc. (“Bridgewater”). As of FebruaryDecember 151, ~~2000~~2008, ~~Willowbridge~~in ~~ceased to serve as a trading manager to the Registrant when the~~accordance ~~remaining~~with ~~assets allocated to Willowbridge, after adjusting for redemptions, declined by greater than 33-1/3% from their balance at~~ the ~~beginning~~Fourth ofAmended ~~the~~and ~~year.~~Restated OnDeclaration ~~July 5, 2000, these assets were reallocated to Gamma Capital Management, LLC (“Gamma”). As~~ of ~~January 31,~~Trust ~~2003~~and ~~Gamma was terminated as a trading manager to the~~ Trust. ~~On February 14~~Agreement, ~~2003~~ the Managing Owner ~~and~~is ~~the~~no ~~Trust~~longer ~~entered~~required ~~into an advisory agreement with Graham Capital Management, LP (“Graham”)~~ to ~~manage~~maintain a ~~portion~~capital ofaccount ~~the Trust’s assets. Pursuant to the advisory agreement, Graham is to be paid a monthly management fee~~ equal to 1~~/6 of 1~~% ~~(2% annually) and an incentive fee~~ of ~~20% of~~ the ~~“New~~total ~~High~~capital ~~Net~~accounts ~~Trading Profits” on the portion~~ of ~~Trust assets allocated to Graham,~~ the ~~same as was paid to Gamma. Graham does not have to recoup Gamma’s cumulative trading losses before earning any incentive fees. As a result of the changes in the~~ Registrant’s ~~independent~~or ~~commodity trading managers as discussed above, during~~ a ~~majority~~net worth of ~~July~~at ~~and~~least ~~August 1998, February 16, 2000 through July 4, 2000, as well as from February~~ $1, ~~2003 through February 13~~000, ~~2003, a portion of the Registrant’s assets were not allocated to commodities trading and, as a result, were not subject to management fees and commissions~~000. ~~The monthly management fees paid on traded assets and the quarterly incentive fees paid on~~ ~~“New High Net Trading Profits” (as defined in each advisory agreement among the Registrant, Managing Owner and each trading manager) to each trading manager are as follows:~~

Trading Manager	Monthly Management Fee	Quarterly Incentive Fee
Bridgewater	.9756% annually of traded assets	20% of New High Net Trading Profits
Gamma (through January 31, 2003)	2% annually of traded assets	20% of New High Net Trading Profits
Graham	2% annually of traded assets	20% of New High Net Trading Profits

The Trading Advisor and the Trading Vehicle

~~Competition~~Registrant was organized under the Delaware Statutory Trust Act on October 16, 1995 and commenced trading operations on May 1, 1996. Registrant will terminate on December 31, 2015 unless terminated sooner as provided in the Fourth Amended and Trust Agreement. Registrant was formed to engage in the speculative trading of commodity futures, forward and options contracts. The trustee of Registrant is Wilmington Trust Company.

~~The~~Effective ~~Managing~~November 1, ~~Owner~~2006, ~~and~~Registrant allocated its ~~affiliates~~net ~~have~~assets ~~formed,~~to WMT III Series H/J Trading Vehicle LLC (the “H/J Trading Vehicle”) and ~~may~~received a ~~continue~~voting membership interest in the H/J Trading Vehicle. The H/J Trading Vehicle was formed to ~~form~~function as an aggregate trading vehicle for its members. The sole members of the H/J Trading Vehicle were the Registrant, ~~various~~World ~~entities~~Monitor toTrust ~~engage~~III – Series H (“Series H”) and World Monitor Trust III – Series J (“Series J”). Preferred is the managing owner of Series H and Series J and had been delegated administrative authority over the operations of the H/J Trading Vehicle. The H/J Trading Vehicle engaged in the speculative trading of futures, ~~forward~~ and ~~options~~forwards contracts. ~~which~~The ~~have~~H/J ~~certain~~Trading Vehicle entered into an advisory agreement (the “H/J Trading Vehicle Advisory Agreement”) with Bridgewater Associates, Inc. (“Bridgewater”) to make the trading decisions for the H/J Trading Vehicle. Bridgewater traded 100% of the ~~same~~assets ~~investment~~of ~~policies~~the asH/J Trading Vehicle pursuant to Bridgewater’s Aggressive Pure Alpha Futures Only – A No Benchmark program, which was a fundamental, systematic, global macro program. All references herein to Registrant’s relationship with Bridgewater shall, unless the context states otherwise, refer to Registrant’s relationship with Bridgewater through Registrant’s investment in the H/J Trading Vehicle.

~~The~~Effective ~~Registrant~~April 1, ~~was~~2007, anRegistrant ~~open-end~~withdrew ~~fund~~as ~~which~~a member ~~solicited~~of the ~~sale~~H/J ofTrading ~~additional~~Vehicle ~~Interests~~and oncontributed its net assets to WCM Pool LLC (“WCM Pool”), a ~~monthly~~Delaware ~~basis~~limited ~~until~~liability ~~the~~company, ~~continuous~~and ~~offering~~received ~~period expired~~a voting membership interest in WCM Pool. As(The ~~such,~~H/J Trading Vehicle subsequently liquidated and terminated the ~~Registrant~~H/J noTrading ~~longer~~Vehicle ~~competes~~Advisory ~~with~~Agreement ~~other~~on ~~entities~~April 30, 2007). WCM Pool was formed to ~~attract~~function ~~new~~as ~~participants~~an aggregate trading vehicle for its members. ~~However~~Registrant, toDiversified Futures Trust I and Kenmar Global Trust are the sole ~~extent~~members ~~that~~of WCM Pool as of December 31, 2008. Preferred has been delegated administrative authority over the ~~trading~~operations ~~managers~~of ~~recommend~~WCM ~~similar~~Pool. orWCM ~~identical~~Pool ~~trades~~engages toin the ~~Registrant~~speculative trading of futures and ~~other~~forwards ~~accounts~~contracts. ~~which~~The ~~they~~financial ~~manage,~~statements ~~the~~of ~~Registrant~~WCM ~~may~~Pool, ~~compete~~including ~~with~~the ~~those~~condensed ~~accounts~~schedule of investments, asare ~~well~~included asin ~~other~~Section ~~market~~II ~~participants~~of Registrant’s financial statements, ~~for~~and ~~the~~should ~~execution~~be ofread ~~the~~in ~~same~~conjunction orwith ~~similar~~Registrant’s ~~trades~~financial statements.

~~Employees~~WCM Pool has entered into an advisory agreement (the “WCM Pool Advisory Agreement”) with Winton Capital Management Limited (“Winton”) whereby Winton will make the trading decisions for the WCM Pool and, in turn, Registrant, pursuant to Winton’s Diversified Program.

(The ~~Registrant~~term “Trading ~~has~~Vehicle”, noas ~~employees.~~used ~~Management~~herein, ~~and~~refers ~~administrative~~either ~~services~~to ~~for~~ the ~~Registrant~~H/J ~~are~~Trading ~~performed~~Vehicle byor ~~the~~WCM ~~Managing~~Pool, ~~Owner~~depending orupon ~~third~~the ~~parties pursuant~~applicable toperiod ~~the~~discussed. ~~Trust~~The ~~Agreement~~term “Trading Advisor”, as ~~further~~used ~~discussed~~herein, inrefers ~~Notes~~either 3to ~~and~~Bridgewater 4or, Winton, todepending upon the ~~Registrant’s~~applicable ~~financial~~period ~~statements~~discussed. ~~included~~The interm ~~its~~“Trading ~~annual~~Advisory ~~report~~Agreement”, toas ~~interest~~used ~~holders~~herein, ~~for~~refers either to the ~~year~~H/J ~~ended~~Trading ~~December 31,~~Vehicle ~~2005~~Advisory ~~(the~~Agreement ~~“Registrant’s~~or ~~2005~~the ~~Annual Report”),~~WCM ~~which~~Pool isAdvisory ~~filed~~Agreement, asdepending anupon ~~exhibit~~the applicable ~~hereto~~period discussed.)

~~Available~~The ~~information~~Advisory Agreement may be terminated for various reasons, including at the discretion of the Trading Vehicle. Registrant has allocated 100% of the proceeds from the initial and continuous offering of Registrant to the Trading Advisor. Registrant, through its investment in the Trading Vehicle, pays a monthly management fee equal to 0.16667% (2% annually) of the assets allocated to

~~The~~4 Trust files quarterly, annual and current reports with the Securities and Exchange Commission (“SEC”). These reports are available to read and copy at the SEC’s Public Reference Facilities in Washington, D.C. at 459 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC’s toll free number, 1-800-SEC-0330, for further information. The Trust does not maintain a website where these reports are posted. However, the Trust’s filings are posted on the SEC’s website at htttp://www.sec.gov.

~~Item 1A~~the Trading Advisor. ~~Risk~~Registrant, ~~Factors~~through its investment in the Trading Vehicle, pays the Trading Advisor an incentive fee of 20% of New High Net Trading Profits (as defined in the Advisory Agreement) generated by the Trading Vehicle. Incentive fees will accrue monthly and be paid quarterly in arrears.

~~THE~~Competition ~~RISKS YOU FACE~~

~~You~~The ~~Should~~Managing ~~Not~~Owner ~~Rely~~and onits ~~Past~~affiliates ~~Performance~~have informed, ~~Deciding~~and ~~Whether~~may continue to ~~Buy~~form, ~~Units~~various entities to engage in the speculative trading of futures, forward and options contracts which have certain of the same investment policies as Registrant.

~~Each~~Registrant does ~~Advisor~~not ~~selected~~currently, byand ~~the~~does ~~Managing~~not ~~Owner to~~intend ~~manage~~in the ~~assets~~future ofto, ~~each~~solicit ~~Trust has a performance history through~~ the ~~date~~sale of ~~its~~additional ~~selection by The Managing Owner~~Interests. ~~You~~As ~~must consider~~such, ~~however,~~Registrant ~~the~~does ~~uncertain significance of past performance, and you should~~ not ~~rely~~compete onwith ~~the~~other ~~Advisors’~~entities ~~or the Managing Owner’s records~~ to ~~date~~attract ~~for~~new ~~predictive~~fund ~~purposes~~participants. ~~You~~However, ~~should~~to ~~not~~the ~~assume~~extent that ~~any~~the ~~Advisor’s~~Trading ~~future~~Advisors ~~trading~~recommend similar ~~decisions will create profit, avoid substantial losses~~ or ~~result~~identical intrades ~~performance~~to ~~for~~Registrant ~~the~~and ~~Trust~~other ~~that~~accounts ~~is comparable to~~ that ~~Advisor’s~~ orthey tomanage, ~~the~~Registrant ~~Managing~~may ~~Owner’s~~compete ~~past~~with ~~performance.~~those ~~In fact~~accounts, as awell ~~significant~~as ~~amount~~other ofmarket ~~academic study has shown~~participants, ~~futures~~for ~~funds~~the ~~more~~execution ~~frequently~~of ~~than not underperform~~ the ~~past~~same ~~performance~~or ~~records~~similar ~~included in their prospectuses~~trades.

~~Price~~Employees ~~Volatility May Possibly Cause the Total Loss of Your Investment~~

~~Futures~~Registrant has no employees. Management and ~~forward~~administrative ~~contracts~~services ~~have~~for aRegistrant ~~high~~are ~~degree~~performed ofby ~~price~~the ~~variability~~Managing ~~and~~Owner ~~are~~or ~~subject~~third parties pursuant to ~~occasional~~the ~~rapid~~Trust ~~and~~Agreement, ~~substantial~~as ~~changes.~~further ~~Consequently,~~discussed ~~you~~in ~~could~~Notes ~~lose~~3 ~~all~~and or4 ~~substantially~~to ~~all~~Registrant’s offinancial ~~your~~statements ~~investment~~included in its annual report for the ~~Trust~~year ended December 31, 2008 (“Registrant’s 2008 Annual Report”), which is filed as an exhibit herewith.

~~Speculative~~Item ~~and Volatile Markets Combined With Highly Leveraged Trading May Cause the Trust to Incur Substantial Losses~~1A. Risk Factors

~~The~~THE ~~markets~~RISKS inYOU ~~which~~FACE each Trust trades are speculative, highly leveraged and involve a high degree of risk. Each Advisor’s trading considered individually involves a significant risk of incurring large losses, and there can be no assurance that any Trust will not incur such losses. Futures and forward prices are volatile. Volatility increases risk, particularly when trading with leverage. Trading on a highly leveraged basis, as does each Trust, even in stable markets involves risk; doing so in volatile markets necessarily involves a substantial risk of sudden, significant losses. Due to such leverage, even a small movement in price could cause large losses for the Trust. Market volatility will increase the potential for large losses. Market volatility and leverage mean that any Trust could incur substantial losses, potentially impairing its equity base and ability to achieve its long-term profit objectives even if favorable market conditions subsequently develop.

~~Fees~~You ~~and~~Should ~~Commissions~~Not ~~are~~Rely ~~Charged~~on ~~Regardless~~Past ofPerformance ~~Profitability and May Result~~ in ~~Depletion~~Deciding ofWhether ~~Trust~~to ~~Assets~~Buy Units

~~Each~~The ~~Trust~~Trading isAdvisor ~~subject~~selected by the Managing Owner to manage the ~~fees~~assets ~~and~~of ~~expenses~~the ~~which~~Trust ~~are~~has ~~payable~~a ~~irrespective~~performance history through the date of ~~profitability~~its inselection ~~addition~~by tothe ~~performance fees~~Managing ~~which~~Owner. You must consider, ~~are~~however, ~~payable~~the ~~based~~uncertain significance of past performance, and you should not rely on the ~~profitability~~Trading ofAdvisor’s ~~such~~or ~~Trust~~the Managing Owner’s records to date for predictive purposes. You should not assume that any Trading Advisor’s future trading decisions will create profit, avoid substantial losses or ifresult ain ~~multi-advisor~~performance ~~fund,~~for ~~upon~~the ~~each~~Trust ~~advisors~~that is comparable to the Trading Advisor’s or to the Managing Owner’s past performance. ~~Consequently~~In fact, ~~the~~as ~~expenses~~a significant amount of ~~each~~academic ~~Trust~~study ~~could~~has shown, ~~over~~futures ~~time,~~funds ~~result~~more infrequently than ~~significant~~not ~~losses~~underperform tothe ~~your~~past ~~investment~~performance ~~therein~~records included in their prospectuses.

~~Market~~Price ~~Conditions~~Volatility May ~~Impair~~Possibly ~~Profitability~~Cause the Total Loss of Your Investment

~~The trading~~Futures systems used by certain Advisors are technical, trend-following methods. The profitability of trading under these systems depends on, among other things, the occurrence of significant price trends, which are sustained movements, up or down, in futures and forward ~~prices.~~contracts ~~Such trends may not develop; there~~ have ~~been~~a ~~periods~~high indegree ~~the~~of ~~past without~~ price ~~trends.~~variability ~~The~~and ~~likelihood~~are ofsubject ~~the Units of any Trust being profitable could be materially diminished during periods when events external~~ to ~~the markets~~occasional ~~themselves~~rapid ~~have~~and ansubstantial ~~important impact on prices~~changes. ~~During such periods~~ Consequently, ~~Advisors’~~you ~~historic price analysis~~ could ~~establish~~lose ~~positions~~all onor ~~the~~substantially ~~wrong~~all ~~side~~ of ~~the~~your ~~price~~investment ~~movements~~in ~~caused~~the ~~by such events~~Trust.

~~Discretionary~~Speculative ~~Trading~~and ~~Strategies~~Volatile Markets Combined With Highly Leveraged Trading May Cause the Trust to Incur Substantial Losses.

~~Discretionary~~The ~~traders,~~markets ~~while~~in ~~they~~which ~~may~~the ~~utilize~~Trust ~~market~~trades ~~charts~~are speculative, ~~computer~~highly ~~programs~~leveraged and ~~compilations~~involve ofa ~~quantifiable~~high degree ~~fundamental~~of ~~information~~risk. toThe ~~assist~~Trading ~~them~~Advisor’s ~~in making~~ trading ~~decisions,~~considered ~~make~~individually ~~such~~involves ~~decisions~~a onsignificant ~~the~~risk ~~basis~~ of ~~their~~incurring ~~own~~large ~~judgment~~losses, and ~~“trading~~ ~~instinct,”~~there ~~not~~can onbe no assurance that the ~~basis~~Trust ofwill ~~trading~~not ~~signals~~incur ~~generated~~such bylosses. ~~any~~Futures ~~program~~and orforward ~~model~~prices are volatile. Volatility ~~Such~~increases ~~traders~~risk, ~~may~~particularly bewhen ~~more~~trading ~~prone~~with toleverage. ~~subjective~~Trading ~~judgments~~on a highly leveraged basis, ~~which~~as ~~may~~does ~~have~~the ~~greater~~Trust, ~~potentially~~even ~~adverse~~in ~~effects~~stable onmarkets ~~their~~involves ~~performance~~risk; ~~than~~doing ~~systematic traders,~~so ~~which~~in ~~emphasize~~volatile ~~eliminating~~markets ~~the~~necessarily ~~effects~~involves ofa ~~“emotionalism”~~substantial onrisk ~~their~~of ~~trading~~sudden, significant losses. ~~Reliance~~Due onto ~~trading~~such ~~judgment may~~leverage, ~~over~~even ~~time,~~a ~~produce~~small ~~less~~movement ~~consistent~~in ~~trading~~price ~~results~~could ~~than~~cause ~~implementing~~large alosses ~~systematic~~for ~~approach~~the Trust. ~~Discretionary~~Market ~~traders,~~volatility ~~like trend-following~~will ~~traders,~~increase ~~are~~the ~~unlikely~~potential tofor belarge ~~profitable~~losses. ~~unless~~Market ~~major~~volatility ~~price~~and ~~movements~~leverage ~~occur.~~mean ~~Discretionary~~that ~~traders~~the ~~are~~Trust ~~highly~~could ~~unpredictable~~incur substantial losses, potentially impairing its equity base and ~~can~~ability ~~incur~~to ~~substantial~~achieve ~~losses~~its ~~even~~long-term inprofit ~~apparently~~objectives even if favorable ~~markets~~market conditions subsequently develop.

5In addition to the leveraged trading described above, the Managing Owner has the ability to further increase the leverage of Registrant by allocating notional equity to the Trading Advisor (in a maximum amount of up to 20% of net asset value), which would then permit the Trading Advisor to trade the account of Registrant as if more equity were committed to such accounts than is, in fact, the case. Although the Managing Owner has the option to allocate additional notional equity to the Trading Advisor, the Managing Owner has no current plans to do so.

~~Systematic~~Fees ~~Trading~~and ~~Strategies~~Commissions are Charged Regardless of Profitability and May ~~Incur~~Result ~~Substantial~~in ~~Losses~~Depletion of Trust Assets

AThe ~~systematic~~Trust ~~trader~~is ~~will~~subject ~~generally rely~~ to ~~some~~the ~~degree~~fees ~~on judgmental decisions concerning, for example, what markets to follow~~ and ~~commodities~~expenses towhich ~~trade,~~are ~~when~~payable toirrespective ~~liquidate a~~of ~~position~~ profitability in aaddition ~~contract which is about~~ to ~~expire~~performance ~~and~~fees ~~how~~which, ~~large~~are apayable ~~position~~based toon ~~take~~the inprofitability aof ~~particular~~the ~~commodity.~~Trust, ~~Although~~and, ~~these~~as ~~judgmental decisions may have~~ a ~~substantial~~multi-advisor ~~effect~~fund, onupon athe ~~systematic~~Trading ~~trader~~Advisor’s performance~~, such trader’s primary reliance is on trading programs or models that generate trading signals~~. ~~The systems utilized to generate trading signals are changed from time to time (although generally infrequently)~~Consequently, ~~but~~ the ~~trading~~expenses ~~instructions~~of ~~generated by~~ the ~~systems~~Trust ~~being used~~could, ~~are~~over ~~followed without significant additional analysis or interpretation. Therefore~~time, ~~systematic~~result ~~trading~~in ~~may incur substantial~~ significant losses ~~by failing~~ to ~~capitalize~~your oninvestment ~~market trends that their systems would otherwise have exploited by applying their generally mechanical trading systems by judgmental decisions of employees~~therein. ~~Furthermore,~~Included ~~any~~in ~~trading~~these ~~system~~charges orare ~~trader~~brokerage ~~may~~fees ~~suffer~~and ~~substantial~~operating ~~losses by misjudging the market~~expenses. ~~Systematic~~On ~~traders~~Registrant’s ~~tend~~forward totrading, ~~rely~~“bid-ask” onspreads ~~computerized~~are ~~programs,~~incorporated ~~and~~into ~~some consider~~ the ~~prospect~~pricing of ~~disciplined~~Registrant’s ~~trading,~~forward ~~which~~contracts ~~largely~~by ~~removes~~its counterparties ~~the~~in ~~emotion~~addition ofto the ~~individual~~brokerage ~~trader~~fees ~~from~~paid ~~the~~by ~~trading process, advantageous~~Registrant. ~~Due~~It tois ~~their~~not ~~reliance~~possible ~~upon computers, systematic traders are generally able~~ to ~~incorporate~~quantify athe ~~significant~~“bid-ask” ~~amount of~~spreads ~~data~~paid ~~into~~by aRegistrant ~~particular~~because ~~trading~~Registrant ~~decision.~~cannot ~~However,~~determine ~~when fundamental factors dominate~~ the ~~market,~~profit ~~trading~~its ~~systems~~counterparty ~~may~~is ~~suffer~~making ~~rapid and severe losses due to their inability to respond to such factors until such factors have had a sufficient effect~~ on the ~~market~~forward totrades into ~~create a trend of enough magnitude to generate a reversal of trading signals, by~~ which ~~time~~it aenters. ~~precipitous~~An ~~price~~investor ~~change~~ may ~~already~~never beachieve ~~in progress, preventing liquidation at anything but substantial losses~~profits.

~~Decisions~~5 ~~Based Upon Fundamental Analysis May Not Result in Profitable Trading~~

~~Increase~~Market inConditions ~~Assets Under Management~~ May ~~Affect~~Impair ~~Trading~~Profitability ~~Decisions~~

The ~~more~~trading ~~equity~~systems anused ~~Advisor~~by ~~manages~~certain Trading Advisors are technical, ~~the~~trend-following ~~more~~methods. ~~difficult~~The itprofitability ~~may~~of betrading ~~for~~under ~~that~~this ~~Advisor~~system todepends ~~trade~~on, ~~profitably~~among ~~because~~other ofthings, the ~~difficulty~~occurrence of ~~trading~~significant ~~larger~~price ~~positions without~~trends, ~~adversely~~which ~~affecting~~are ~~prices~~sustained ~~and~~movements, ~~performance.~~up ~~Accordingly~~or down, ~~such~~in ~~increases~~futures inand ~~equity~~forward ~~under~~prices. ~~management~~Such trends may ~~require~~not ~~one~~develop; orthere ~~more~~have ofbeen periods in the ~~Advisors~~past towithout ~~modify~~price ~~trading~~trends. ~~decisions~~The ~~for~~likelihood ~~the~~of ~~Trust,~~Interests ~~which~~being profitable could be materially diminished during periods when events external to the markets themselves have aan ~~detrimental~~important ~~effect~~impact on ~~your~~prices. ~~investment~~During insuch periods, the Trading Advisor’s historic price analysis could establish positions on the wrong side of the price movements caused by such ~~Trust~~events.

~~You~~Discretionary ~~cannot~~Trading beStrategies ~~Assured of the Advisors’ Continued Services Which~~ May BeIncur ~~Detrimental~~Substantial toLosses ~~Trust~~

~~You~~Discretionary ~~cannot~~traders, bewhile ~~assured~~they ~~that~~may ~~any~~utilize ~~Advisor~~market ~~will~~charts, becomputer ~~willing~~programs orand ~~able~~compilations toof ~~continue~~quantifiable fundamental information to ~~provide~~assist ~~advisory~~them ~~services~~in tomaking ~~the~~trading ~~Trust~~decisions, ~~for~~make ~~any~~such ~~length~~decisions on the basis of their ~~time.~~own ~~There~~judgment isand ~~severe~~“trading ~~competition for~~instinct,” not on the ~~services~~basis of ~~qualified~~ trading ~~advisors,~~signals ~~and~~generated aby ~~Trust~~any ~~may~~program ~~not~~or model. Such traders may be ~~able~~more prone to ~~retain~~subjective ~~satisfactory~~judgments, ~~replacement~~which ormay ~~additional~~have ~~trading~~greater ~~advisors~~potentially adverse effects on ~~acceptable~~their performance ~~terms~~than orsystematic atraders, ~~current~~which ~~Advisor~~emphasize eliminating the effects of “emotionalism” on their trading. Reliance on trading judgment may, ~~require~~over ~~the~~time, ~~Trust~~produce toless ~~pay~~consistent ~~higher~~trading ~~fees~~results inthan ~~order~~implementing a systematic approach. Discretionary traders, like trend-following traders, are unlikely to be ~~able~~profitable ~~to retain~~unless ~~such~~major ~~Advisor~~price movements occur. Discretionary traders are highly unpredictable, and can incur substantial losses even in apparently favorable markets.

~~Limited~~Systematic ~~Ability~~Trading toStrategies ~~Liquidate~~May ~~Your~~Incur ~~Investment~~Substantial Losses

~~There~~A systematic istrader nowill ~~secondary~~generally ~~market~~rely to some degree on judgmental decisions concerning, for ~~the~~example, ~~Units~~what markets to follow and commodities to trade, when to liquidate a position in a contract which is about to expire and how large a position to take in a particular commodity. ~~While~~Although ~~the~~these ~~Units~~judgmental decisions may have ~~redemption~~a ~~rights~~substantial effect on a systematic trader’s performance, ~~there~~such trader’s primary reliance is on trading programs or models that generate trading signals. The systems utilized to generate trading signals are ~~restrictions~~changed from time to time (although generally infrequently), ~~and~~but ~~possible~~the ~~fees~~trading ~~assessed~~instructions generated by the systems being used are followed without significant additional analysis or interpretation. Therefore, ~~Transfers~~systematic trading may incur substantial losses by failing to capitalize on market trends that their systems would otherwise have exploited by applying their generally mechanical trading systems by judgmental decisions of ~~Units~~employees. Furthermore, ~~are~~any ~~subject~~trading system or trader may suffer substantial losses by misjudging the market. Systematic traders tend to ~~limitations~~rely on computerized programs, and some consider the ~~Managing~~prospect ~~Owner~~of ~~may~~disciplined ~~deny~~trading, which largely removes the emotion of the individual trader from the trading process, advantageous. Due to their reliance upon computers, systematic traders are generally able to incorporate a significant amount of data into a particular trading decision. However, when fundamental ~~request~~factors dominate the market, trading systems may suffer rapid and severe losses due to ~~transfer~~their ifinability itto ~~determines~~respond ~~that~~to such factors until such factors have had a sufficient effect on the ~~transfer~~market to create a trend of enough magnitude to generate a reversal of trading signals, by which time a precipitous price change may ~~result~~already be in ~~adverse~~progress, ~~legal~~preventing orliquidation ~~tax~~at ~~consequences~~anything ~~for~~but ~~the~~substantial ~~Trust~~losses.

~~Possible~~Decisions ~~Illiquid~~Based ~~Markets~~Upon Fundamental Analysis May ~~Exacerbate~~ ~~Losses~~Not Result in Profitable Trading

~~Futures~~Traders ~~and~~that ~~forward~~utilize ~~positions~~fundamental ~~cannot~~trading ~~always~~strategies beattempt to ~~liquidated~~examine atfactors ~~the~~external ~~desired~~to ~~price.~~the Ittrading ismarket ~~difficult~~that toaffect ~~execute~~the asupply ~~trade~~and atdemand for a ~~specific price~~particular ~~when~~futures ~~there~~and isforward acontracts ~~relatively~~in ~~small~~order ~~volume~~to ofpredict ~~buy~~future ~~and~~prices. ~~sell~~Such ~~orders~~analysis inmay anot ~~market.~~result Ain ~~market~~profitable ~~disruption,~~trading ~~such~~because asthe ~~when~~analyst ~~foreign~~may ~~governments~~not ~~may~~have knowledge ~~take~~of orall befactors ~~subject~~affecting tosupply ~~political~~and ~~actions~~demand, ~~which~~prices ~~disrupt~~may ~~the~~often ~~markets~~be inaffected ~~their~~by ~~currency~~unrelated ~~or major exports~~factors, ~~can also~~and ~~make~~purely itfundamental ~~difficult~~analysis tomay ~~liquidate~~not aenable ~~position.~~the ~~Such~~trader ~~periods~~to ofdetermine ~~illiquidity~~quickly ~~and~~that ~~the~~previous ~~events~~trading ~~that~~decisions ~~trigger~~were ~~them~~incorrect. ~~are~~In ~~difficult~~addition, because toof ~~predict~~the ~~and~~breadth ~~there~~of ~~can~~fundamental bedata nothat ~~assurance~~exists, ~~that~~a ~~any~~fundamental ~~Advisor~~trader ~~will~~may not be able to dofollow ~~so.~~developments ~~There~~in ~~can~~all besuch nodata, ~~assurance~~but ~~that~~instead ~~market illiquidity~~may ~~will~~specialize ~~not~~in ~~cause~~analyzing ~~losses~~a ~~for~~narrow ~~the~~set ~~Trust.~~of ~~The~~data, ~~large~~requiring ~~size~~trading ofin ~~the~~fewer ~~positions~~markets. ~~which~~Consequently, ana fundamental ~~Advisor~~trader ismay ~~expected~~have toless ~~acquire~~flexibility ~~for~~in ~~the~~adverse ~~Trust~~markets ~~increases~~to ~~the~~trade ~~risk~~other offutures ~~illiquidity~~and byforward ~~both~~markets ~~making~~than ~~its~~traders ~~positions~~that ~~more~~do ~~difficult~~not tolimit ~~liquidate~~the ~~and~~number ~~increasing~~of ~~the losses~~markets ~~incurred~~traded ~~while~~as ~~trying~~a toresult doof soa specialized focus.

~~The~~Increase ~~risk of loss due to potentially illiquid markets is more acute~~ in ~~respect~~Assets ofUnder ~~over-the-counter~~Management ~~instruments~~May ~~than in~~Affect ~~respect~~Trading ofDecisions exchange-traded instruments because the performance of those contracts is not guaranteed by an exchange or clearinghouse and the Trust will be at risk to the ability of the counterparty to the instrument to perform its obligations thereunder. Because these markets are not regulated, there are no specific standards or regulatory supervision of trade pricing and other trading activities that occur in those markets.

6The more equity a Trading Advisor manages, the more difficult it may be for that Trading Advisor to trade profitably because of the difficulty of trading larger positions without adversely affecting prices and performance. Accordingly, such increases in equity under management may require one or more of the Trading Advisors to modify trading decisions for the Trust, which could have a detrimental effect on your investment in such Trust.

~~Because~~You NoCannot ~~Trust~~be ~~Acquires~~Assured ~~Any~~of ~~Asset with Intrinsic Value,~~ the ~~Positive~~Trading ~~Performance~~Advisors’ ofContinued ~~Your~~Services ~~Investment~~Which IsMay ~~Wholly Dependent~~Be ~~Upon~~Detrimental anto ~~Equal~~Trust ~~and Offsetting Loss~~

~~Futures~~You ~~trading~~cannot be isassured athat ~~risk~~any ~~transfer~~Trading ~~economic~~Advisor ~~activity.~~will ~~For~~be ~~every~~willing ~~gain~~or ~~there~~able isto ancontinue ~~equal~~to ~~and~~provide ~~offsetting~~advisory ~~loss rather~~services ~~than~~to anthe ~~opportunity~~Trust tofor ~~participate~~any ~~over~~length of time. inThere ~~general~~is ~~economic~~severe ~~growth.~~competition ~~Unlike~~for ~~most~~the ~~alternative~~services ~~investments,~~of anqualified ~~investment~~trading inadvisors, aand the Trust ~~does~~may not ~~involve~~be ~~acquiring~~able ~~any~~to retain ~~asset~~satisfactory ~~with~~replacement ~~intrinsic~~or ~~value.~~additional ~~Overall~~trading ~~stock~~advisors ~~and~~on ~~bond~~acceptable ~~prices~~terms ~~could~~or ~~rise significantly~~the ~~and~~Trading Advisor may require the ~~economy~~Trust asto apay ~~whole~~higher ~~prospers;~~fees ~~while~~in ~~the~~order ~~Trust~~to ~~trades~~be ~~unprofitably~~able to retain such Trading Advisor.

~~Failure~~6 ~~of Futures Trading to be Non-Correlated to General Financial Markets Will Eliminate Benefits of Diversification~~

~~Trading~~Limited onAbility ~~Commodity Exchanges Outside the United States is Not Subject~~ to ~~U.S.~~Liquidate ~~Regulation~~Your Investment

~~Advisors~~There ~~are~~is ~~expected~~no tosecondary ~~engage~~market infor ~~some~~the orUnits. ~~all~~While ofthe ~~its~~Units ~~trading~~have onredemption ~~behalf~~rights, ofthere ~~the~~are ~~Trust~~restrictions, onand ~~commodity~~possible ~~exchanges~~fees ~~outside the United States~~assessed. ~~Trading~~For onexample, ~~such~~Units ~~exchanges~~may isbe ~~not regulated~~redeemed byonly ~~any~~as ~~United~~of ~~States~~the ~~governmental~~close ~~agency~~of ~~and~~business ~~may~~on ~~involve~~the ~~certain~~last business ~~risks~~day ~~not~~of ~~applicable~~a tocalendar ~~trading~~month onprovided ~~United~~a ~~States~~request ~~exchanges.~~for Inredemption ~~trading~~is ~~contracts~~received ~~denominated~~at inleast ~~currencies~~five ~~other~~business ~~than~~days ~~U.S.~~prior ~~dollars, each Trust will be subject~~ to the ~~risk~~end of ~~adverse~~ ~~exchange-rate~~such ~~movements~~month ~~between~~excluding the ~~dollar~~last ~~and~~business day of the ~~functional~~month. ~~currencies~~Transfers of ~~such~~Units ~~contracts.~~are ~~Investors~~subject ~~could~~to ~~incur~~limitations, ~~substantial~~and ~~losses~~the ~~from~~Managing Owner ~~trading~~may ondeny ~~foreign~~a ~~exchanges~~request byto ~~any~~transfer ~~Trust~~if toit ~~which~~determines ~~such~~that ~~Investors~~the ~~would~~transfer ~~not~~may ~~have~~result ~~been~~in ~~subject~~adverse ~~had~~legal ~~the Advisors~~or ~~limited~~tax ~~their~~consequences ~~trading~~for tothe UTrust.S. ~~markets.~~

~~Various~~Possible Illiquid ~~Actual~~Markets ~~and Potential Conflicts of Interest~~ May BeExacerbate ~~Detrimental~~Losses ~~to Unitholders~~

~~The~~Futures ~~Trust~~and isforward ~~subject~~positions tocannot ~~actual~~always ~~and~~be ~~potential~~liquidated ~~conflicts~~at ~~of interests involving~~ the ~~Managing~~desired ~~Owner,~~price. ~~the~~It ~~Advisors,~~is ~~and~~difficult ~~various~~to ~~brokers~~execute ~~and~~a trade ~~servicing~~at ~~agents.~~a ~~The~~specific ~~Managing Owner,~~price ~~the~~when ~~Advisors,~~there ~~and~~is ~~their~~a ~~respective~~relatively ~~principals,~~small ~~all~~volume of ~~which~~buy ~~are~~and ~~engaged~~sell orders in ~~other~~a ~~investment~~market. ~~activities~~A market disruption, ~~are~~such ~~not~~as ~~required~~when toforeign ~~devote~~governments ~~substantially~~may ~~all~~take ofor ~~their~~be ~~time~~subject to ~~the~~political ~~Trust’s business~~actions, which ~~also~~disrupt ~~presents~~ the ~~potential~~markets ~~for~~in ~~numerous~~their currency or ~~conflicts~~major ofexports, ~~interest~~can ~~with~~also ~~the~~make ~~Trust.~~it Asdifficult to liquidate a ~~result~~position. Periods of ~~these~~illiquidity ~~and~~have ~~other~~accrued ~~relationships,~~from ~~parties~~time-to-time ~~involved~~in ~~with~~ the ~~Trust~~past, ~~have~~such aas ~~financial~~in ~~incentive~~connection towith ~~act~~Russia’s indefault aon ~~manner~~its ~~other~~sovereign ~~than~~debt in ~~the~~1998.Such ~~best~~periods ~~interests~~ of ~~the~~illiquidity ~~Trust~~ and ~~its~~the events ~~Unitholders.~~that ~~The~~trigger ~~Managing~~them ~~Owner has~~are ~~not~~difficult ~~established~~to ~~any~~predict ~~formal~~and ~~procedure~~there tocan ~~resolve~~be ~~conflicts~~no ofassurance ~~interest.~~that ~~Consequently,~~the ~~investors~~Trading Advisor will be ~~dependent~~able onto ~~the~~do ~~good~~so. ~~faith~~There ofcan ~~the~~be ~~respective~~no ~~parties~~assurance ~~subject~~that tomarket ~~such~~illiquidity ~~conflicts~~will tonot ~~resolve~~cause ~~them~~losses ~~equitably.~~for ~~Although~~ the ~~Managing~~Trust. ~~Owner attempts~~The tolarge ~~monitor~~size ~~these~~of ~~conflicts,~~the itpositions which isthe ~~extremely~~Trading ~~difficult,~~Advisor ifis ~~not~~expected ~~impossible,~~to acquire for the ~~Managing~~Trust ~~Owner~~increases tothe ~~ensure~~risk ~~that~~of ~~these~~illiquidity ~~conflicts~~by doboth ~~not,~~making inits ~~fact,~~positions ~~result~~more indifficult ~~adverse~~to ~~consequences~~liquidate toand increasing the ~~various~~losses ~~Trust~~incurred while trying to do so.

The ~~Trust~~risk ~~may~~of beloss ~~subject~~due to ~~certain~~potentially ~~conflicts~~illiquid ~~with~~markets is more acute in respect toof ~~its~~over-the-counter ~~Clearing~~instruments ~~Broker,~~than ~~its~~in ~~Futures~~respect ~~Broker,~~of ~~and~~exchange-traded ~~any~~instruments ~~executing~~because ~~broker~~the performance ~~including,~~of ~~but~~those contracts is not ~~limited~~guaranteed ~~to,~~by ~~conflicts that~~an ~~result~~exchange ~~from~~or ~~receiving~~clearinghouse ~~greater~~and ~~amounts~~the ofTrust ~~compensation~~will ~~from~~be ~~other~~at ~~clients,~~risk ~~purchasing~~to ~~opposite~~the orability ~~competing~~of ~~positions~~the oncounterparty ~~behalf~~to ofthe ~~third~~instrument ~~party~~to ~~accounts~~perform ~~traded~~its ~~through~~obligations ~~the~~thereunder. ~~Clearing~~Because ~~Broker~~these markets are not regulated, ~~the~~there are ~~Futures~~no ~~Broker~~specific standards or regulatory supervision of trade pricing and ~~executing~~other ~~brokers~~trading activities that occur in those markets.

~~Unitholders~~Because ~~Taxed~~the ~~Currently~~Trust does not Acquire Any Asset with Intrinsic Value, the Positive Performance of Your Investment Is Wholly Dependent Upon an Equal and Offsetting Loss

~~Unitholders of a Trust are subject to~~Futures ~~tax~~and ~~each~~forward ~~year~~trading onis ~~their~~a ~~allocable~~risk ~~share~~transfer ofeconomic ~~the~~activity. ~~income~~For orevery ~~gains~~gain ~~(if~~there ~~any)~~is ofan ~~such~~equal ~~Trust,~~and ~~whether~~offsetting orloss ~~not~~rather ~~they~~than ~~receive~~an ~~distributions.~~opportunity ~~Moreover, the Managing Owner does not intend~~ to ~~make~~participate ~~any~~over ~~distributions~~time toin ~~Unitholders~~general ineconomic ~~respect~~growth. ofUnlike ~~any~~most ~~Trust. Consequently~~alternative investments, ~~Unitholders~~an ofinvestment ain the Trust ~~will~~does benot ~~required~~involve ~~either~~acquiring toany ~~redeem~~asset ~~Units~~with orintrinsic tovalue. ~~make~~Overall ~~use~~stock ofand ~~other~~bond ~~sources~~prices ofcould ~~funds~~rise tosignificantly ~~discharge~~and ~~their~~the ~~tax~~economy ~~liabilities~~as ina ~~respect~~whole ofprospers; ~~any~~while ~~profits~~the ~~earned~~Trust bytrades ~~such Trust~~unprofitably.

InFailure ~~comparing the profit objectives~~ of ~~each~~Futures ~~Trust~~and ~~with~~Foreign ~~the~~Exchange ~~performance~~Trading ofto ~~more familiar securities in which one might invest, prospective investors must recognize that if they purchased equity or debt, there probably would~~ be no tax due on the appreciation in the value of such holdings until disposition. In the case of each Trust, on the other hand, a significant portion of any appreciation in the Net Asset Value per Unit must be paid in taxes by the Unitholders of such Trust every year, resulting in a substantial cumulative reduction in their net afterNon-~~tax~~Correlated ~~returns.~~to ~~Because~~General ~~Unitholders~~Financial ofMarkets aWill ~~Trust~~Eliminate ~~will~~Benefits ~~be taxed currently on their allocable share~~ of ~~the~~Diversification income or gains of such Trust, if any, the Trust may trade successfully but investors nevertheless would have recognized significantly greater gains on an after-tax basis had they invested in conventional stocks with comparable performance.

7Historically, managed futures and foreign exchange generally have been non-correlated to the performance of other asset classes such as stocks and bonds. Non-correlation means that there is no statistically valid relationship between the past performance of futures and forward contracts on the one hand and stocks or bonds on the other hand. Non-correlation should not be confused with negative correlation, where the performance would be exactly opposite between two asset classes. Because of this non-correlation, Registrant cannot be expected to be profitable during unfavorable periods for the stock market, or vice-versa. The futures and forward markets are fundamentally different from the securities markets in that for every gain in futures and forward trading, there is an equal and offsetting loss. If the Trust does not perform in a manner non-correlated with the general financial markets or does not perform successfully, you will obtain no diversification benefits by investing in the Units of the Trust and the Trust may have no gains to offset your losses from other investments.

~~Limitation~~Trading on ~~Deductibility~~Commodity ofExchanges ~~“Investment~~Outside ~~Advisory~~the ~~Fees”~~United States is Not Subject to U.S. Regulation

~~Non-corporate~~The ~~Unitholders~~Trading ofAdvisor amay engage ~~Trust~~in ~~may~~some beor ~~required~~all toof ~~treat~~its ~~the~~trading ~~amount~~on behalf of ~~Incentive~~the ~~Fees~~Trust ~~and~~on ~~other~~commodity ~~expenses~~exchanges ofoutside the United States. Trading on such ~~Trust~~exchanges asis ~~“investment~~not ~~advisory~~regulated ~~fees”~~by ~~which may~~any beUnited ~~subject~~States togovernmental ~~substantial~~agency ~~restrictions~~and onmay ~~deductibility~~involve ~~for~~certain ~~federal~~risks ~~income~~not ~~tax~~applicable ~~purposes~~to trading on United States exchanges. In ~~the~~trading ~~absence~~contracts ofdenominated ~~further~~in ~~regulatory~~currencies orother ~~statutory~~than ~~clarification~~U.S. dollars, the ~~Managing~~Trust ~~Owner~~will isbe ~~not~~subject ~~classifying~~to ~~these~~the ~~expenses~~risk asof ~~“investment~~adverse ~~advisory~~exchange-rate movements between the dollar and the functional currencies of such contracts. ~~fees~~Additionally,” ~~but~~trading ~~this~~on foreign exchanges is aalso ~~position~~subject to ~~which~~ the ~~Internal~~risk ~~Revenue~~of ~~Service~~exchange ~~(“the~~controls, ~~IRS”)~~expropriation, ~~may~~excessive ~~object~~taxation or government disruption. IfInvestors acould incur substantial ~~portion~~losses offrom ~~the~~trading ~~fees~~on ~~and~~foreign ~~other~~exchanges ~~expenses~~by ofthe a Trust ~~were~~to ~~characterized~~which such asinvestors ~~“investment~~would ~~advisory~~not ~~fees,”~~have anbeen ~~investment in~~subject ~~such~~had ~~Trust~~the ~~might~~Trading noAdvisor ~~longer~~limited beits ~~economically~~trading ~~viable~~to U.S. markets.

~~Taxation~~Various ofActual ~~Interest~~and ~~Income~~Potential ~~Irrespective~~Conflicts of Interest ~~Trading~~May ~~Losses~~Be Detrimental to Unitholders

~~With~~The ~~respect~~Trust tois ~~each~~subject ~~Trust,~~to ~~the~~actual ~~Net~~and ~~Asset~~potential ~~Value~~conflicts ~~per~~of ~~Unit~~interests ~~reflects~~involving the ~~trading~~Managing ~~profits~~Owner, ~~and~~the Trading ~~losses~~Advisor, asand ~~well~~various asbrokers ~~the~~and ~~interest~~servicing ~~income~~agents. ~~earned~~The ~~and~~Managing ~~expenses~~Owner, ~~incurred~~the byTrading ~~such Trust. However~~Advisor, ~~losses~~and ontheir ~~such~~respective ~~Trust’s~~principals, ~~trading~~all ~~will~~of bewhich ~~almost~~are ~~exclusively~~engaged ~~capital~~in ~~losses~~other investment activities, ~~and~~are ~~capital~~not ~~losses~~required ~~are~~to ~~deductible~~devote ~~against~~substantially ~~ordinary~~all ~~income~~of ~~only~~their time to the ~~extent~~Trust’s ~~of $3~~business,~~000~~ ~~per~~which ~~year~~also inpresents the ~~case~~potential offor ~~non-corporate~~numerous ~~taxpayers.~~conflicts ~~Consequently,~~of ifinterest ~~a non-corporate~~with ~~Unitholder~~the ~~had, for example, an allocable trading (i~~Trust.~~e.,~~ ~~capital)~~As ~~loss of $10,000 in~~ a ~~given~~result ~~fiscal~~of ~~year~~these and ~~allocable~~other ~~interest (i.e.~~relationships, ~~ordinary)~~parties ~~income~~involved ~~(after~~with ~~reduction for expenses) of $5,000,~~ the ~~Unitholder~~Trust ~~would~~ have ~~incurred~~ a ~~net loss~~financial inincentive ~~the Net Asset Value of such Unitholder’s Units equal~~ to ~~$5,000~~act ~~but~~in ~~would recognize taxable income of $2,000 (assuming~~ a ~~40%~~manner ~~tax~~other ~~rate).~~than in ~~The~~the ~~limited~~best ~~deductibility~~interests of ~~capital~~the ~~losses~~Trust ~~for~~and ~~non-corporate~~its Unitholders. ~~could~~The ~~result~~Managing inOwner ~~such Unitholders~~has ~~having~~not aestablished ~~tax~~any ~~liability~~formal inprocedure ~~respect~~to ofresolve ~~their~~conflicts ~~investment in a Trust~~ of ~~the Trust despite incurring a financial loss on their Units of such Trust~~interest. Consequently,

~~Possibility~~7 ~~of a Tax Audit of Both the Trust and the Unitholders~~

~~Failure~~ investors orwill ~~Lack~~be ofdependent ~~Segregation~~on the good faith of ~~Assets~~the ~~May~~respective ~~Increase~~parties ~~Losses~~subject to such conflicts to resolve them equitably. Although the Managing Owner attempts to monitor these conflicts, it is extremely difficult, if not impossible, for the Managing Owner to ensure that these conflicts do not, in fact, result in adverse consequences to the various Trust.

The ~~Commodity~~ ~~Exchange~~Trust ~~Act~~may ~~requires~~be asubject ~~clearing broker~~ to ~~segregate~~certain ~~all~~conflicts ~~funds~~with ~~received~~respect ~~from~~to ~~customers~~its ~~from~~clearing ~~such~~ broker’(s), ~~proprietary~~its ~~assets.~~futures ~~If the clearing~~ broker ~~fails to do so~~, ~~the~~and ~~assets~~any ofexecuting ~~any~~broker ~~Trust~~including, ~~might~~but not belimited ~~fully protected in the event of~~to, ~~their~~conflicts ~~bankruptcy.~~that ~~Furthermore,~~result infrom ~~the~~receiving ~~event~~greater amounts of ~~the~~compensation ~~clearing~~from ~~broker’s~~other ~~bankruptcy~~clients, ~~any~~purchasing ~~Trust~~opposite ~~could~~or becompeting ~~limited~~positions toon ~~recovering~~behalf ~~only a pro rata share~~ of ~~all~~third ~~available~~party ~~funds~~accounts ~~segregated~~traded onthrough ~~behalf of~~ the clearing broker~~’s combined customer accounts~~, ~~even though certain property specifically traceable to such Trust (for example, Treasury bills deposited by such Trust with~~ the ~~clearing~~futures broker asand ~~margin)~~executing ~~was held by the clearing broker~~brokers.

~~Default~~Unitholders byTaxed ~~Counterparty~~Currently ~~and Credit Risk Could Cause Substantial Losses~~

~~Dealers~~Unitholders ~~in forward contracts~~ are ~~not regulated by the Commodity Exchange Act and are not obligated~~ subject to ~~segregate~~tax ~~customer~~each ~~assets.~~year Ason atheir ~~result,~~allocable ~~Unitholders~~share doof ~~not have such basic protections with respect to~~ the ~~trading~~income inor ~~forward~~gains ~~contracts~~(if by any) ~~Trust. This lack~~ of ~~regulation~~the ~~in these markets could expose a~~ Trust, inwhether ~~certain circumstances to significant losses in the event of trading abuses~~ or ~~financial~~not ~~failure~~they byreceive ~~the counterparties~~distributions. ~~Each~~Moreover, ~~Trust also faces~~ the ~~risk~~Managing ofOwner ~~non-performance~~does ~~by the~~not ~~counterparties~~intend to ~~the~~make ~~over-the-counter~~any ~~contracts.~~distributions ~~Unlike in futures contracts, the counterparty~~ to ~~these~~Unitholders ~~contracts~~in isrespect ~~generally a single bank or other financial institution, rather than a clearing organization backed by a group~~ of ~~financial institutions.~~the ~~As a result~~Trust. Consequently, ~~there~~Unitholders will be ~~greater~~required ~~counterparty~~either ~~credit~~to ~~risk~~redeem inUnits ~~these~~or ~~transactions.~~to ~~The~~make ~~clearing~~use ~~member,~~of ~~clearing organization or~~ other ~~counterparty~~sources ~~may~~of ~~not~~funds ~~be able~~ to ~~meet~~discharge ~~its~~their ~~obligations,~~tax liabilities in ~~which~~respect ~~case~~of ~~the~~any ~~applicable~~profits ~~Trust~~earned ~~could suffer~~by ~~significant~~the ~~losses on these contracts~~Trust.

~~Regulatory~~In ~~Changes~~comparing the profit objectives of the Trust with the performance of more familiar securities in which one might invest, prospective investors must recognize that if they purchased equity or ~~Actions~~debt, ~~May~~there ~~Alter~~probably would be no tax due on the ~~Nature~~appreciation in the value of ansuch ~~Investment~~holdings until disposition. In the case of the Trust, on the other hand, a significant portion of any appreciation in the Net Asset Value per Unit must be paid in taxes by the Unitholders of the Trust every year, resulting in a substantial cumulative reduction in their net after-tax returns. Because Unitholders will be taxed currently on their allocable share of the income or gains of the Trust, if any, the Trust may trade successfully but investors nevertheless would have recognized significantly greater gains on an after-tax basis had they invested in conventional stocks with comparable performance.

~~Considerable~~Limitation ~~regulatory attention has been focused~~ on ~~non-traditional~~Deductibility investment pools, in particular commodity pools such as the Trust, publicly distributed in the United States. There has been significant international governmental concern expressed regarding, for example, (i) the disruptive effects of ~~speculative~~“Investment ~~trading~~Advisory onFees” the central banks’ attempts to influence exchange rates and (ii) the need to regulate the derivatives markets in general. There is a possibility of future regulatory changes altering, perhaps to a material extent, the nature of an investment in any Trust.

~~The~~Non-corporate ~~futures~~Unitholders ~~markets~~may ~~are~~be ~~subject~~required to ~~comprehensive~~treat ~~statutes,~~the ~~regulations,~~amount ~~and~~of ~~margin~~Incentive ~~requirements.~~Fees Inand ~~addition,~~other ~~the~~expenses ~~CFTC~~of ~~and~~ the ~~exchanges~~Trust ~~are~~as ~~authorized~~“investment toadvisory ~~take~~fees” ~~extraordinary~~which ~~actions~~may inbe ~~the~~subject ~~event~~to ofsubstantial arestrictions ~~market~~on ~~emergency, including,~~deductibility for ~~example,~~federal ~~the~~income ~~retroactive~~tax purposes. ~~implementation~~In ofthe ~~speculative~~absence ~~position~~of ~~limits~~further regulatory or ~~higher~~statutory ~~margin requirements~~clarification, the ~~establishment~~Managing ofOwner ~~daily~~is ~~price~~not ~~limits~~classifying ~~and~~these ~~the~~expenses ~~suspension~~as of“investment ~~trading.~~advisory ~~The~~fees,” ~~regulation~~but ofthis ~~futures~~is ~~and~~a ~~forward~~position ~~transactions~~to inwhich the ~~United~~ ~~States~~Internal isRevenue aService ~~rapidly~~(the “IRS”) ~~changing~~may ~~area~~object. ofIf ~~law~~a ~~and~~substantial isportion ~~subject~~of tothe ~~modification~~fees ~~by government~~ and ~~judicial~~other ~~action.~~expenses ~~The~~of ~~effect~~the ofTrust ~~any~~were ~~future~~characterized ~~regulatory~~as ~~change~~“investment onadvisory ~~the~~fees,” ~~Trust~~an isinvestment ~~impossible~~in tothe ~~predict,~~Trust ~~but~~might ~~could~~no longer be ~~substantial~~economically ~~and adverse~~viable.

8Taxation of Interest Income Irrespective of Trading Losses

With respect to the Trust, ~~Trading~~the isNet ~~Not~~Asset ~~Transparent~~Value per Unit reflects the trading profits and losses as well as the interest income earned and expenses incurred by the Trust. However, losses on the Trust’s trading will be almost exclusively capital losses, and capital losses are deductible against ordinary income only to the extent of $3,000 per year in the case of non-corporate taxpayers. Consequently, if a non-corporate Unitholder had, for example, an allocable trading (i.e., capital) loss of $10,000 in a given fiscal year and allocable interest (i.e., ordinary) income (after reduction for expenses) of $5,000, the Unitholder would have incurred a net loss in the Net Asset Value of such Unitholder’s Units equal to $5,000 but would recognize taxable income of $2,000 (assuming a 40% tax rate). The limited deductibility of capital losses for non-corporate Unitholders could result in such Unitholders having a tax liability in respect of their investment in the Trust despite incurring a financial loss on their Units of the Trust.

~~Trading~~Possibility ~~decisions in respect~~ of ~~each~~a ~~Trust,~~Tax ~~are~~Audit ~~made~~of byBoth the ~~Advisor~~Trust ~~or Advisors. While the Managing Owner receives daily trade confirmations from the Clearing Broker~~ and ~~foreign exchange dealers, such information is not provided to Unitholders and each Trust’ trading results are reported to~~ the Unitholders. ~~Accordingly, an investment in a Trust does not offer you the same transparency, i.e., an ability to review all investment positions daily that a personal trading account offers.~~

~~Lack~~There can be no assurance that the tax returns of ~~Independent~~the ~~Experts~~Trust ~~Representing~~will ~~Investors~~not be audited by the IRS. If such an audit results in an adjustment, Unitholders of the Trust could themselves be audited as well as being required to pay additional taxes, interest and possibly penalties.

~~The~~PROSPECTIVE ~~Managing~~INVESTORS ~~Owner~~ARE ~~has~~STRONGLY ~~consulted~~URGED ~~with~~TO CONSULT ~~counsel,~~THEIR ~~accountants~~OWN ~~and~~TAX ~~other~~ADVISERS ~~experts~~AND ~~regarding~~COUNSEL ~~the~~WITH ~~formation~~RESPECT ~~and~~TO ~~operation~~THE ofPOSSIBLE ~~the~~TAX ~~Trust.~~CONSEQUENCES ~~Accordingly,~~TO ~~you~~THEM ~~should~~OF ~~consult~~AN ~~your~~INVESTMENT ~~own~~IN ~~legal,~~REGISTRANT; ~~tax~~SUCH ~~and~~TAX ~~financial~~CONSEQUENCES ~~advisers~~MAY ~~regarding~~DIFFER ~~the desirability~~IN ofRESPECT anOF ~~investment~~DIFFERENT ~~in the Trust~~INVESTORS.

~~Forwards,~~Failure ~~Swaps,~~or ~~Hybrids~~Lack ~~and~~of ~~Other~~Segregation ~~Derivatives~~of ~~are~~Assets ~~Not~~May ~~Subject~~Increase toLosses ~~CFTC Regulation~~

~~Each~~The Commodity ~~Trust~~Exchange ~~may~~Act ~~trade~~(“CEA”) ~~foreign~~requires ~~exchange~~a ~~contracts~~futures incommission ~~the~~merchant ~~interbank~~(“FCM”) ~~market.~~clearing ~~Since~~broker ~~forward~~to ~~contracts~~segregate ~~are~~all ~~traded~~funds inreceived ~~unregulated~~from ~~markets~~customers ~~between~~from ~~principals,~~such ~~the~~broker’s ~~commodity~~proprietary ~~pools also~~assets. ~~assume~~If the ~~risk~~clearing ofbroker ~~loss~~fails to ~~from~~do ~~counterparty~~so, ~~nonperformance. In~~ the ~~future,~~assets of the Trust ~~may~~might ~~also~~not ~~trade~~be ~~swap~~fully ~~agreements,~~protected ~~hybrid~~in ~~instruments~~the ~~and~~event ~~other~~of ~~off-exchange~~their ~~contracts~~bankruptcy. ~~Swap~~Furthermore, ~~agreements~~in ~~involve~~the ~~trading~~event ~~income~~of ~~streams~~the ~~such~~clearing asbroker’s ~~fixed~~bankruptcy, ~~rate~~the ~~or floating~~Trust ~~rate~~could ~~interest.~~be ~~Hybrids~~limited ~~are~~to ~~instruments,~~recovering ~~which~~only ~~combine features of~~ a ~~security~~pro ~~with~~rata ~~those~~share of aall ~~futures~~available funds ~~contract.~~segregated ~~Because~~on ~~there~~behalf isof nothe ~~exchange or~~ clearing- ~~house~~broker’s ~~for~~combined ~~these~~customer ~~contracts~~accounts, ~~the~~even ~~Trust~~though ~~will~~certain beproperty ~~subject~~specifically traceable to the ~~credit~~Trust ~~risk~~(for ~~and nonperformance of the counterparty. Additionally~~example, ~~because~~Treasury ~~these~~bills ~~off-exchange~~deposited ~~contracts are not regulated~~ by the ~~CFTC, no~~ Trust ~~will~~with ~~receive~~ the ~~protections,~~clearing ~~which~~broker ~~are~~as ~~provided~~margin) bywas held by the ~~CFTC’s~~clearing ~~regulatory scheme~~broker.

~~Possibility~~In ofthe ~~Termination~~event of the ~~Trust~~FCM’s orbankruptcy, ~~any~~Registrant ~~Trust~~may ~~Before~~recover ~~Expiration~~a pro-rata share or none of its ~~Stated~~assets. ~~Term~~

As8 Managing Owner, the Managing Owner may withdraw from the Trust, which would cause the Trust to terminate unless a Substitute Managing Owner was appointed. Other events, such as a long-term substantial loss suffered by any Trust, could also cause such Trust to terminate before the expiration of its stated term. This could cause you to liquidate your investments and upset the overall maturity and timing of your investment portfolio. If the registrations with the CFTC or memberships in the NFA of the Managing Owner or the Clearing Broker were revoked or suspended, such entity would no longer be able to provide services to the Trust.

~~None~~Default by Counterparty and Credit Risk Could Cause Substantial Losses

Dealers in forward contracts are not regulated by the CEA and are not obligated to segregate customer assets. As a result, Unitholders do not have such basic protections ~~Item 2~~with respect to the trading in forward contracts by the Trust. ~~Properties~~This lack of regulation in these markets could expose the Trust in certain circumstances to significant losses in the event of trading abuses or financial failure by the counterparties. The Trust also faces the risk of non-performance by the counterparties to the over-the-counter contracts. Unlike in futures contracts, the counterparty to these contracts is generally a single bank or other financial institution, rather than a clearing organization backed by a group of financial institutions. As a result, there will be greater counterparty credit risk in these transactions. The clearing member, clearing organization or other counterparty may not be able to meet its obligations, in which case the Trust could suffer significant losses on these contracts.

~~The~~Regulatory ~~Registrant~~Changes ~~does not own~~ or ~~use~~Actions ~~any~~May ~~physical~~Alter ~~properties in~~ the ~~conduct~~Nature of ~~its business. The~~an ~~Registrant’s~~Investment ~~only~~in ~~place of business is~~ the ~~place~~Trust ~~of business of Preferred.~~

~~Certain~~Considerable ~~administrative~~regulatory ~~services~~attention ~~are~~has ~~provided~~been byfocused ~~DPM~~on ~~Mellon~~non-traditional ~~which~~investment ispools, in particular commodity pools such as ~~located~~the atTrust, ~~400~~publicly ~~Atrium~~distributed ~~Drive~~in the United States. There has been significant international governmental concern expressed regarding, ~~Somerset~~for example, ~~New~~(i) the ~~Jersey~~disruptive ~~08873~~effects of speculative trading on the central banks’ attempts to influence exchange rates and (ii) the need to regulate the derivatives markets in general. There is a possibility of future regulatory changes altering, perhaps to a material extent, the nature of an investment in the Trust.

The futures markets are subject to comprehensive statutes, regulations, and margin requirements. In addition, the Commodity Futures Trading Commission ~~Item 3~~(“CFTC”) and the exchanges are authorized to take extraordinary actions in the event of a market emergency, including, for example, the retroactive implementation of speculative position limits or higher margin requirements, the establishment of daily price limits and the suspension of trading. ~~Legal~~The ~~Proceedings~~regulation of futures and forward transactions in the United States is a rapidly changing area of law and is subject to modification by government and judicial action. The effect of any future regulatory change on the Trust is impossible to predict, but could be substantial and adverse.

~~There~~Trust ~~are~~Trading nois ~~material~~Not ~~legal proceedings pending by or against the Registrant or the Managing~~Transparent ~~Owner.~~

Trading decisions in respect of the Trust, are made by the Trading Advisor. While the Managing Owner receives daily trade confirmations from the ~~Item 4~~clearing broker and foreign exchange dealers, such information is not provided to Unitholders and the Trust’s trading results are reported to the Unitholders. ~~Submission~~Accordingly, ofan ~~Matters~~investment in the Trust does not offer you the same transparency, i.e., an ability to review all investment positions daily that a ~~Vote~~personal oftrading ~~Interest~~account ~~Holders~~offers. The Managing Owner may (but is under no obligation to) provide estimated daily or weekly values to unitholders.

~~None~~Lack of Independent Experts Representing Investors

The Managing ~~PART~~Owner IIhas consulted with counsel, accountants and other experts regarding the formation and operation of the Trust. No counsel has been appointed to represent an investor in connection with the offering of the Units. Accordingly, you should consult your own legal, tax and financial advisers regarding the desirability of an investment in the Trust.

~~Item 5.~~Forwards, ~~Market for the Registrant’s Interests~~Swaps, ~~Related~~Hybrids ~~Interest~~and ~~Holder~~Other ~~Matters~~Derivatives ~~and~~are Not ~~Issuer~~Subject ~~Purchases~~to ofCFTC ~~Equity~~Regulation ~~Securities~~

~~Information~~The ~~with~~Trust ~~respect~~may totrade foreign exchange contracts in the ~~offering~~interbank market. Since forward contracts are traded in unregulated markets between principals, the commodity pools also assume the risk of ~~Interests~~loss from counterparty nonperformance. In the future, the Trust may also trade swap agreements, hybrid instruments and other off-exchange contracts. Swap agreements involve trading income streams such as fixed rate or floating rate interest. Hybrids are instruments, which combine features of a security with those of a futures contract. The dealer market for off-exchange instruments is ~~incorporated~~becoming byless ~~reference~~liquid. Because tothere ~~Note~~is 1no exchange or clearing- house for these contracts, the Trust will be subject to the ~~Registrant’s~~credit ~~2005~~risk ~~Annual~~and ~~Report~~nonperformance of the counterparty. Additionally, because these off-exchange contracts are not regulated by the CFTC, the Trust will not receive the protections, which isare ~~filed~~provided asby anthe ~~exhibit~~CFTC’s ~~hereto~~regulatory scheme.

AThere ~~significant~~may ~~secondary~~be ~~market~~an ~~for~~additional risk due to the ~~Interests~~fact ~~has~~Registrant ~~not~~may trade ~~developed,~~foreign ~~and~~exchange itcontracts isoff-exchange ~~not~~and, ~~expected~~as ~~that~~such, ~~one~~does ~~will~~not ~~develop~~have inprotection ~~the~~of ~~future~~an exchange. There ~~are~~is also ~~certain~~the ~~restrictions~~additional ~~set~~risk ~~forth~~that in the ~~Trust~~assets ~~Agreement~~held ~~limiting~~with the ~~ability of~~clearing anbroker ~~Interest~~for ~~holder~~trading tooff-exchange ~~transfer~~foreign ~~Interests.~~currencies ~~However, redemptions~~ are ~~permitted~~not ~~monthly~~required onto ~~at least ten days prior written notice at the then current net asset value per Interest~~be segregated.

9Registrant may also trade options on futures. Although successful options trading requires many of the same skills as successful futures trading, the risks are different. Successful options trading requires a trader to assess accurately near-term market

~~There~~9 are no material restrictions upon the Registrant’s present or future ability to make distributions in accordance with the provisions of the Trust Agreement. No distributions have been made since inception and no distributions are anticipated in the future.

~~Item 6~~volatility because that volatility is immediately reflected in the price of outstanding options. ~~Selected~~Correct ~~Financial~~assessment ~~Data~~of market volatility can therefore be of much greater significance in trading options than it is in many long-term futures strategies where volatility does not have as great an effect on the price of a futures contract.

~~The~~Foreign ~~following~~Exchange ~~table~~Currency ~~presents~~Trading selected financial data of the Registrant. This data should be read in conjunction with the financial statements of the Registrant and the notes thereto on pages 3 through 15 of the Registrant’s 2005 Annual Report, which is ~~filed~~Not asSubject anto ~~exhibit~~CFTC ~~hereto.~~Regulation

	Year Ended December 31,
	2005			2004		2003		2002		2001
Total revenues (including interest)	$	42,356		$	1,133,877	$	2,074,858	$	1,340,965	$	46,410
Net income (loss)	$	(586,703	)	$	336,524	$	1,345,782	$	543,531	$	(905,292	)
Net income (loss) per weighted average Interest	$	(8.99	)	$	4.54	$	15.44	$	5.11	$	(6.96	)
Total assets	$	5,977,060		$	7,761,364	$	8,246,373	$	8,584,796	$	9,569,029
Net asset value per Interest	$	99.36		$	108.01	$	102.72	$	87.29	$	82.31

The Trading Advisor may trade its program by entering into spot and forward transactions involving currencies with United States and foreign banks and currency dealers. As with the risks involved in forward contracts (see above), trading in spot and forward foreign exchange transactions is not regulated by the CFTC and such contracts are not traded on or guaranteed by an exchange or its clearing house.

~~Item 7.~~Possibility ~~Management’s~~of ~~Discussion~~Termination ~~and~~of ~~Analysis~~the ofTrust or ~~Financial~~any ~~Condition~~Trust ~~and~~Before ~~Results~~Expiration of ~~Operations~~its Stated Term

~~Critical~~As Managing Owner, Preferred may withdraw from the Trust, which would cause the Trust to terminate ~~Accounting~~unless ~~Policies~~a Substitute Managing Owner was appointed. Other events, such as a long-term substantial loss suffered by any Trust, could also cause the Trust to terminate before the expiration of its stated term. This could cause you to liquidate your investments and upset the overall maturity and timing of your investment portfolio. If the registrations with the CFTC or memberships in the NFA of the Managing Owner or the clearing broker were revoked or suspended, such entity would no longer be able to provide services to the Trust.

~~Preparation~~Registrant ofis ~~the~~subject ~~financial~~to ~~statements~~Speculative ~~and~~Position ~~related~~Limits disclosures in compliance with accounting principles generally accepted in the United States of America requires the application of appropriate accounting rules and guidance, as well as the use of estimates. The Trust’s application of these policies involves judgments and actual results may differ from the estimates used.

The ~~Managing~~CFTC ~~Owner~~and ~~has~~U.S. ~~evaluated~~futures ~~the~~exchanges ~~nature~~have ~~and~~established ~~types~~speculative ofposition ~~estimates~~limits ~~that~~(referred itto ~~makes~~as in“position ~~preparing~~limits”) on the ~~Trust’s~~maximum ~~financial~~position ~~statements~~in ~~and~~certain ~~related~~futures ~~disclosures~~interests ~~and~~contracts ~~has determined~~ that ~~the~~may ~~valuation~~be ofheld ~~its~~or ~~investments~~controlled ~~which~~by ~~are~~any ~~not~~one ~~traded~~person ~~on a United States~~ or ~~Internationally recognized futures exchange involves a critical accounting policy~~group. ~~The~~Therefore, ~~market values of futures (exchange traded) contracts is verified by~~ the ~~administrator~~Trading ~~who~~Advisor ~~obtains~~may ~~valuation~~have ~~data~~to ~~from~~reduce ~~third party data providers such as Bloomberg and Reuters and compares those prices with~~ the ~~Trust’s~~size ~~broker.~~of ~~The~~its ~~market~~position ~~value~~in ofone ~~currency~~or ~~swap~~more ~~and~~futures ~~forward (non-exchange traded)~~ contracts isin ~~extrapolated~~order onto aavoid ~~forward~~exceeding ~~basis~~such ~~from~~position ~~the~~limits, ~~spot~~which ~~prices~~could adversely ~~quoted~~affect ~~as of 3 PM on~~ the ~~last~~profitability ~~business day~~ of ~~the reporting period~~Registrant. ~~All values assigned by the administrator and confirmed by the Managing Owner are final and conclusive as to all Interest holders.~~

AsReliance ~~such, if actual results vary from estimates used, they are anticipated to not have a material impact~~ on the ~~financial~~Trading ~~statements and~~Advisor ~~related~~to ~~disclosures.~~Trade Successfully

~~Liquidity~~The Trading Advisor is responsible for making all futures, forwards, and ~~Capital~~options ~~Resources~~trading decisions on behalf of Registrant. The Managing Owner has no control over the specific trades the Trading Advisor makes, leverage used, risks and/or concentrations assumed or whether the Trading Advisor will act in accordance with the disclosure documents or descriptive materials furnished by them to the Managing Owner. The Managing Owner can provide no assurance that the trading programs employed by the Trading Advisor will be successful.

~~The~~Item ~~Trust commenced operations on May 1, 1996 with gross proceeds of $12,686,200 allocated to commodities trading~~1B. ~~Additional~~Unresolved ~~Interests~~Staff were offered monthly at the then current net asset value per Interest until the continuous offering period expired on January 31, 1998. Additional contributions made during the continuous offering from the sales of Interests totaled $51,242,700, including $375,000 of contributions from the Managing Owner. Comments

~~The~~None Trust Agreement provides that an Interest holder may redeem its Interests as of the last day of any month at the then current net asset value per Interest. Redemptions of limited interests recorded for the years ended December 31, 2005, 2004 and 2003 were $1,022,214, $927,071 and $1,723,634, respectively. Redemptions by the Managing Owner for the years ended December 31, 2005, 2004 and 2003 were $10,396, $8,452 and $17,348, respectively. Redemptions of limited interests and general interests from the commencement of operations, May 1, 1996, to December 31, 2005 totaled $56,998,226, and $463,209, respectively. Future redemptions will impact the amount of funds available for investment in commodity contracts in subsequent periods.

AtItem ~~December 31, 2005, 100% of the Trust’s net assets were allocated to commodities trading~~2. A significant portion of the net assets of the Trust was held in cash, which was used as margin for the Trust’s trading in commodities. Inasmuch as the sole business of the Trust is to trade in commodities, the Trust continues to own such liquid assets to be used as margin. Through August 31, 2005, the broker credited the Trust monthly with 80% of the interest it earns on the equity balances in these accounts and paid the remaining 20% to the Managing Owner. Effective September 1, 2005 the broker credits the Trust 100% of the earned interest on such equity accounts. Properties

10Registrant does not own or use any physical properties in the conduct of its business. Registrant’s only place of business is the place of business of the Managing Owner.

~~The~~Certain ~~commodities~~administrative ~~contracts~~services are ~~may~~provided beby ~~subject~~Spectrum toGlobal ~~periods~~Fund ~~of illiquidity because of market conditions~~Administration, ~~regulatory considerations and other reasons~~L. ~~For example~~L.C., ~~commodity~~Registrant’s ~~exchanges~~administrator ~~limit~~(the ~~fluctuations in commodity futures contract prices during a single day by regulations referred to as~~ “~~daily limits.~~Administrator” ~~During a single day~~), nowhich ~~trades~~is ~~may~~located ~~be executed~~ at ~~prices~~ ~~beyond~~33 ~~the~~West ~~daily~~Monroe, ~~limit.~~Suite ~~Once~~1000, ~~the price of a futures contract for a particular commodity has increased or decreased by an amount equal to the daily limit~~Chicago, ~~positions~~IL ~~in the commodity can neither be taken nor liquidated unless traders are willing to effect trades at or within the limit~~60603. Commodity futures prices have occasionally moved the daily limit for several consecutive days with little or no trading. Such market conditions could prevent the Trust from promptly liquidating its commodity futures positions.

~~Since~~Item the Trust’s business is to trade futures and forward contracts, its capital is at risk due to changes in the value of these contracts (market risk) or the inability of counterparties to perform under the terms of the contracts (credit risk)3. ~~The~~Legal Trust’s exposure to market risk is influenced by a number of factors, including the volatility of interest rates and foreign currency exchange rates, the liquidity of the markets in which the contracts are traded and the relationships among the contracts held. The inherent uncertainty of the Trust’s speculative trading, as well as the development of drastic market occurrences, could result in monthly losses considerably beyond the Trust’s experience to date and could ultimately lead to a loss of all or substantially all of investors’ capital. The Managing Owner attempts to minimize these risks by requiring the Trust’s trading managers to abide by various trading limitations and policies, which include limiting margin amounts, trading only in liquid markets and permitting the use of stop loss provisions. See Note 6 of the 2005 financial statements for a further discussion of the credit and market risks associated with the Trust’s futures and forward contracts. Proceedings

~~The~~There ~~Trust~~are ~~does~~no ~~not~~material ~~have,~~legal ~~nor~~proceedings ~~does~~pending by itor ~~expect~~against toRegistrant ~~have,~~or ~~any~~the ~~capital~~Managing ~~assets~~Owner.

~~Off-Balance~~Item ~~Sheet~~4. ~~Arrangements~~Submission ~~and~~of ~~Contractual Obligations~~Matters to a Vote of Security Holders

~~As of December 31, 2005, the Trust had not utilized special purpose entries to facilitate off-balance sheet financing arrangements and~~None has no loan guarantee arrangements or off-balance sheet arrangements of any kind other than agreements entered into in the normal course of business which may include indemnification provisions related to certain risk service providers undertake in performing services which are in the best interests of the Trust. While the Trust’s exposure under such indemnification provisions cannot be estimated, these general business indemnifications are not expected to have a material impact on the Trust’s financial position.

~~The~~PART ~~Trust’s~~II contractual obligations are with the Managing Owner, the Trading Advisor and its commodity broker. Payments made under the Trust’s agreement with the Trading Advisor are at a fixed rate, calculated as a percentage of the Trust’s “New High Net Trading Profits”. In addition, management fee payments made to the Trading Advisor and fees paid to the Managing Owner are calculated as a fixed percentage of the Trust’s Net Asset Value. As such, the Managing Owner cannot anticipate the amount of payments that will be required under these agreements for future periods as Net Asset Values are not known until a future date. Commission payments to the commodity broker are based on a cost per executed trade and, as such, the Managing Owner cannot anticipate the amount of payments that will be required under the brokerage agreement for future periods as the level of executed trades are not known until a future date. These agreements are effective for one-year terms, renewable automatically for additional one-year terms unless terminated. Additionally, these agreements may be terminated by either party for various reasons. For a further discussion on these payments, see Notes 1 and 3 of the Registrant’s 2005 Annual Report.

~~Results~~Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of ~~Operations~~Equity Securities

~~The~~Information ~~net~~with ~~asset~~respect ~~value~~to ~~per Interest as of December 31, 2005 was $99.36, a decrease of 8.01% from~~ the ~~December 31,~~offering ~~2004 net asset value per Interest~~ of ~~$108.01,~~Interests which was an increase of 5.15% from the December 31, 2003 net asset value per Interest of $102.72. The CISDM CPO Asset Weighted Index (formerly the Zurich Fund/Pool Qualified Universe Index) returned 5.97% and 3.22% for the years ended December 31, 2005 and 2004, respectively. The CISDM CPO Asset Weighted Index is ~~the~~incorporated ~~dollar~~by ~~weighted,~~reference ~~total~~to ~~return~~Note of1 ~~all~~to ~~commodity~~Registrant’s ~~pools~~2008 ~~tracked~~Annual ~~by Managed Account Reports~~Report, ~~LLC.~~ ~~Past~~which ~~performance~~ is ~~not~~filed ~~necessarily~~as ~~indicative~~an ofexhibit ~~future results~~hereto.

~~The~~A ~~Trust’s~~significant ~~trading~~secondary ~~gains/(losses)~~market ~~before~~for ~~commissions~~the ~~were~~Interests ~~approximately $(142,000),~~has $1not developed,~~036,000~~ and ~~$1,975,000~~it ~~during~~is ~~the~~not ~~years~~expected ~~ended~~that ~~December 31,~~one ~~2005,~~will ~~2004~~develop ~~and~~in ~~2003,~~the ~~respectively~~future. ~~Due~~There toare ~~the~~also ~~nature~~certain restrictions ofset forth in the Trust’s ~~trading~~Agreement ~~activities,~~limiting the ability of a ~~period~~unitholder to ~~period~~transfer ~~comparison~~Interests. ofHowever, ~~its~~redemptions ~~trading~~are ~~results~~permitted ismonthly ~~not~~on ~~meaningful. However,~~at aleast ~~detailed~~ten ~~discussion~~days ofprior written notice at the ~~Trust’s~~then ~~2005~~current ~~trading~~net ~~results~~asset isvalue ~~presented~~per ~~below~~Interest.

~~2005~~There ~~was~~are anno ~~eventful~~material ~~year~~restrictions inupon ~~the~~Registrant’s ~~global~~present ~~economic~~or ~~markets.~~future ~~The rise~~ability into ~~global~~make ~~energy~~distributions ~~prices~~in toaccordance ~~historic~~with ~~highs~~the ~~was~~provisions aof ~~primary~~the ~~factor~~Trust Agreement. ~~that~~No ~~dominated~~distributions ~~the~~have ~~global~~been ~~economy,~~made ~~along~~since ~~with~~inception ~~many~~and ~~other~~no ~~economic,~~distributions ~~geopolitical~~are ~~and~~anticipated ~~social~~in ~~issues~~the future.

~~The~~As ~~U.S.~~of ~~equity~~January 31, ~~markets lagged most foreign equity markets in 2005. The Dow Jones Industrial Index had its first annual loss since 2002~~2009, ~~while~~there ~~the~~were ~~technology oriented Nasdaq Index had a modest 1% gain and the S&P~~263 ~~500~~holders ~~Index gained 3% for the year. Overall corporate earnings exceeded expectations for most~~ of ~~the~~record ~~year,~~owning ~~including the third and fourth quarters~~31,432.885 ~~The impact of several hurricanes~~Interests, ~~high~~which ~~energy~~includes ~~prices~~325 ~~and rising~~General ~~interest rates were among the negative factors for the year~~Interests.

1110

~~One~~Item ~~of the notable themes in U~~6.S. ~~interest~~Selected ~~rates~~Financial was a flattening yield curve and a gradual trend toward inversion. The inversion finally occurred in December as the 10-year finished with a 4.39% yield versus 4.40% for the 2-year. The inversion was the first in six years. This pattern occurred in the face of 13 consecutive 25 point Federal Open Market Committee rate hikes to 4.25%. In Europe, the European Central Bank raised rates 25 points to 2.25% but this was not considered an indication of a cycle of rate hikes as European economic growth, while improved, remained fairly modest. Data

The ~~U.S.~~following ~~dollar~~table ~~ended~~presents ~~stronger in~~selected ~~2005,~~financial ~~not~~data ~~withstanding~~of aRegistrant. ~~volatile~~This ~~trading~~data ~~pattern~~should ~~during~~be ~~the~~read ~~year.~~in ~~For~~conjunction ~~the~~with ~~year,~~ the ~~U.S.~~financial ~~dollar~~statements ~~rose~~of ~~approximately~~Registrant ~~15% against the Japanese yen~~ and the ~~Euro.~~notes ~~The~~thereto ~~interest~~on ~~rate~~pages ~~differential~~6 ~~was~~through ~~the~~17 ~~primary~~of ~~factor behind the U.S. dollar~~Registrant’s ~~solid performance.~~2008 ~~The~~Annual ~~British pound finished 2005 lower due to weakness in the U.K. economy. As a result of rate increases by the Bank of Canada~~Report, ~~the~~which ~~Canadian~~is ~~dollar~~filed ~~gradually~~as ~~gained~~an ~~versus~~exhibit ~~the U~~hereto.S. dollar, ending the year up 4.1%. The Australian dollar declined in 2005 despite rate hikes and strong equity markets. The Russian ruble decreased approximately 3.4% for the year. The full impact of the revaluation of the Chinese renminbi at midyear has yet to be realized.

Crude oil and related products were among the largest gainers in the commodities markets for 2005. Energy prices peaked in the summer, around the time of Hurricanes Katrina and Rita, and declined in October and November. Weather was a contributing influence to the decrease as above normal temperatures continued through the end of the year. Global demand, however, was ever increasing, with China and India in the forefront.


	Year Ended December 31,
	2008		2007		2006		2005			2004
Total revenues (including interest)	$	1,005,306	$	1,150,811	$	644,361	$	42,356		$	1,133,877

Net income (loss)	$	424,130	$	483,025	$	85,669	$	(586,703	)	$	336,524

Net income (loss) per weighted average Interest	$	12.36	$	10.87	$	1.53	$	(8.99	)	$	4.54

Total assets	$	3,973,187	$	4,362,123	$	5,296,676	$	5,977,060		$	7,761,364

Net asset value per Interest	$	123.31	$	111.60	$	100.24	$	99.36		$	108.01

InItem ~~the metals, gold prices steadily advanced in 2005, particularly in the final quarter of the year~~7. ~~Strong~~Management’s ~~physical~~Discussion and ~~investment~~Analysis ~~demand, particularly from the Far East, was a yearlong feature. European central banks were reserved sellers and a number~~ of ~~other~~Financial ~~central~~Condition ~~banks, such as Russia~~ and ~~OPEC~~Results ~~nations, increased the amount~~ of gold in their reserve asset portfolios. Additionally, gold assumed the role as an alternative currency in 2005 as traders shied away from the U.S. dollar, Japanese yen and Euro. Silver prices tracked gold for much of the year due to strong physical demand from India in particular. In the base metals, copper prices rose significantly as strong Chinese demand remained a driving force throughout the year. Operation

~~The~~Critical ~~Trust’s~~Accounting ~~trading~~Policies ~~profits were the result of gains in the energy, indices, metals and softs sectors. Net losses for the Trust were experienced in the currencies, grains, and interest rate sectors.~~

~~Currencies:~~Preparation ~~(-)~~of ~~The~~the ~~currency~~financial ~~sector~~statements ~~was~~and ~~down~~related ~~for~~disclosures in compliance with accounting principles generally accepted in the ~~year,~~United States of America requires the ~~result~~application of ~~three~~appropriate ~~negative~~accounting ~~quarters~~rules and guidance. ~~Long~~Applying ~~positions~~these inpolicies requires the ~~Japanese~~Managing ~~yen,~~Owner ~~the~~to ~~British~~make ~~pound~~judgments, estimates and assumptions in connection with the ~~Australian~~preparation ~~dollar~~of ~~negatively~~Registrant’s ~~impacted~~financial ~~the~~statements. ~~portfolio~~Actual inresults ~~2005~~may differ from the estimates used.

~~Energy: (+)~~ The ~~sector~~Managing ~~generated~~Owner ~~net~~has evaluated ~~profits~~Registrant’s financial statements and related disclosures and has determined that the policies discussed below are critical accounting policies because they involve estimates, judgments and assumptions that are particularly complex, subjective or uncertain. For further discussion of Registrant’s significant accounting policies, see Note 2 to Registrant’s financial statements for the year ended December 31, as2008, ~~gains~~which inwas ~~natural~~included ~~gas~~in ~~and~~the ~~unleaded~~Registrant’s ~~gas~~annual report ~~offset~~on ~~losses~~Form in10-K ~~crude~~for ~~oil~~the ~~and~~fiscal ~~gas~~year ~~oil~~ended ~~trading~~December 31, 2008.

~~Grains:~~The valuation of Registrant’s investments that are not traded on a United States (-“US”) or internationally recognized futures exchange is a critical accounting policy. The ~~grain~~market ~~sector~~values ~~was~~of ~~down~~futures ~~for~~(exchange ~~the~~traded) ~~year~~contracts is verified by Registrant’s administrator, ~~primarily~~which ~~due~~obtains tovaluation ~~long~~data ~~positions~~from third inparty ~~wheat~~data providers such as Bloomberg, Reuters, and ~~long~~Super Derivatives and ~~short~~compares ~~positions~~those inprices ~~corn~~with Registrant’s clearing broker. The market value of currency swap and ~~soybean~~forward (non-exchange traded) contracts is extrapolated on a forward ~~meal~~basis from the spot prices quoted as of 4 PM on the last business day of the reporting period. All values assigned by the administrator and confirmed by the Managing Owner are final and conclusive as to all of Registrant’s Unitholders.

~~Indices:~~As ~~(+) Despite~~such, ~~losses~~if inactual ~~the~~results ~~first~~vary ~~half~~from ofestimates ~~the year~~used, ~~the~~they ~~sector~~are ~~ended~~not ~~the~~anticipated ~~year~~to onhave a ~~positive~~material ~~note.~~impact ~~Long~~on ~~positions in~~ the ~~Tokyo Stock~~financial ~~Index,~~statements ~~the CAC 40~~ and ~~the IBEX offset losses in the S&P 500 Mini and the NASDAQ 100~~related disclosures.

~~Interest~~Registrant ~~Rates:~~records ~~(-)~~all ~~Profits~~investments at fair value in ~~the~~its ~~first~~financial ~~half~~statements, with changes in fair value reported as a component of Revenues—Unrealized in the ~~year~~ ~~were~~Statements ~~offset~~of byOperations. ~~losses~~The Trust considers prices for exchange traded commodity futures and options contracts to be based on quoted prices in ~~the~~active ~~second~~markets ~~half~~for identical assets (Level 1). The values of ~~the~~forwards, swaps, ~~year~~and certain option contracts for which market quotations are not readily available are priced by third party data providers such as Bloomberg, ~~resulting~~Reuters inand aor ~~loss~~Super Derivatives who derive fair values for ~~the~~those ~~year~~assets from observable inputs (Level 2). ALevel ~~majority~~3 ofinputs ~~the~~reflect ~~loss~~Registrant’s ~~was~~assumptions ~~attributable~~that toit ~~short~~believes ~~positions~~market participants would use in pricing the ~~British~~asset ~~Gilt,~~or ~~and~~liability. ~~long~~Registrant ~~and~~develops ~~short~~Level ~~positions~~3 inputs based on the best information available in the ~~Eurodollar~~circumstances, ~~and~~which may Uinclude indirect correlation to a market value, combinations of market values or Registrant’s proprietary data.S. ~~Treasury~~Level ~~Bond~~3 inputs generally include information derived through extrapolation or interpolation of observable market data.

~~Metals:~~In July 2006, the Financial Accounting Standards Board (+“FASB”) ~~The~~ ~~metals~~issued ~~sector~~FASB ~~was~~Interpretation ~~profitable~~No. 48, “Accounting for Uncertainty in ~~three~~Income ~~out~~Taxes—an interpretation of FASB Statement No. 109” (“FIN 48”), which clarifies the ~~four~~accounting ~~quarters~~for uncertainty in ~~2005~~tax positions. FIN 48 requires that Registrant recognize in its financial statements the impact of a tax position if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The provisions of FIN 48 were effective for fiscal years beginning after December 15, 2006, with ~~long~~the cumulative ~~positions~~effect of the change in ~~gold~~accounting principle recorded as an adjustment to opening retained earnings. In connection with the adoption of FIN 48, ~~copper~~Registrant has elected an accounting policy to classify interest and ~~zinc~~penalties ~~providing~~related to unrecognized tax benefits as interest or other expense. All tax tears which are statutorily open are subject to examination by the ~~largest~~appropriate ~~profits~~taxing authorities. The Managing Owner evaluated the impact of adopting FIN 48 on Registrant’s financial statements. In the Managing Owner’s opinion, the adoption of FIN 48 had no material impact on Registrant, as Registrant’s tax positions are based on established tax precedence for the tax treatment of investment partnerships as flow through tax entities.

~~Softs:~~11 ~~(+) The sector was positive for 2005 primarily due to long positions in sugar in the second half of the year.~~

~~Commissions~~In ~~are~~September ~~calculated~~2006, on the ~~Trust’s~~FASB ~~net~~issued ~~asset~~SFAS ~~value~~No. 157 at(“SFAS ~~the~~157”), ~~beginning~~“Fair ofValue ~~each~~Measurements”. ~~month~~SFAS ~~and,~~157 ~~therefore,~~requires ~~vary~~use ~~according~~of a fair value hierarchy that prioritizes the inputs to ~~trading~~valuation ~~performance~~techniques ~~and~~used ~~redemptions.~~to ~~Commissions~~measure ~~decreased~~fair byvalue ~~approximately~~into ~~$56,000~~three ~~for~~levels: ~~the~~quoted ~~year~~market ~~ended~~prices ~~December 31,~~in ~~2005~~active asmarkets ~~compared~~for toidentical ~~2004~~assets and ~~decreased~~liabilities by(Level ~~approximately $44~~1),~~000~~ inputs other than quoted market prices that are observable for the ~~year~~asset ~~ended December 31~~or liability, ~~2004~~either asdirectly ~~compared~~or toindirectly ~~2003~~(Level ~~due~~2), toand unobservable inputs for the ~~decline~~asset inor ~~average~~liability ~~net~~(Level ~~asset~~3). ~~levels~~SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007.

12Registrant adopted SFAS 157 in the first quarter of 2008. The adoption of SFAS 157 had no impact to the items required to be carried at fair value (investments) in Registrant’s financial statements. $0 or 0.00% of Registrant’s investments at December 31, 2008 are classified as Level 1 or Level 3 and $3,929,018 or 100.00% are classified as Level 2 using the fair value hierarchy of SFAS 157. $0 or 0.00% of Registrant’s investments at December 31, 2007 are classified as Level 1 or Level 2 and $4,196,579 or 100.00% are classified as Level 3 using the fair value hierarchy of SFAS 157.

AtInvestments ~~December 31,~~classified ~~2005,~~as ~~all~~Level ~~trading~~2 ~~decisions~~and ~~were~~Level ~~made~~3 byunder ~~Graham~~SFAS ~~and~~157 ~~Bridgewater.~~represent ~~Management~~the ~~fees~~Registrant’s ~~are~~investment ~~calculated~~in onthe Trading Vehicle and are valued monthly at the net asset value ~~allocated~~as toreported ~~each~~by ~~trading~~the ~~manager~~Trading atVehicle. The Trading Vehicle’s net asset value is determined based upon its management’s best estimate of the ~~end~~fair value of ~~each~~its ~~month~~underlying ~~and,~~net ~~therefore~~assets, substantially all of which are investments ~~affected~~valued byusing ~~trading~~Level ~~performance~~1 inputs but include certain assets and ~~redemptions~~liabilities where the inputs into the determination of fair value require management judgment or estimation. ~~Management~~The ~~fees~~Managing ~~decreased~~Owner bydetermined ~~approximately~~that ~~$13~~certain of the Trading Vehicle’s assets and liabilities which require management judgment or estimation were not material to the Registrant’s financial statements and therefore the Registrant’s investment in the Trading Vehicle should be classified as Level 2 at December 31,~~000~~ 2008. A table presenting the changes in the Level 2 and Level 3 fair value categories for the ~~year~~years ended December 31, ~~2005~~2008 ~~as compared~~and to2007 ~~2004~~is ~~and~~provided ~~decreased~~in byNote ~~approximately~~5 of the Registrant’s financial statements filed herewith. Of the $6717,~~000~~713 and $816,558 of gains for the ~~year~~years ended December 31, ~~2004~~2008 asand ~~compared~~2007, torespectively, ~~2003.~~reported ~~The~~on ~~decreases~~Level ~~were~~2 ~~due~~and toLevel ~~the~~3 ~~decline~~investments in ~~average~~Note ~~net~~5, ~~asset~~$(36,149) ~~levels~~and $17,674, respectively, represent a change in unrealized gain (loss) allocated from WCM Pool on the Registrant’s statements of operations.

~~Incentive~~In ~~fees~~October ~~are~~2008, ~~based~~the onFASB ~~the~~issued FASB Staff Position FAS 157-3, “~~New~~Determining ~~High~~the Fair ~~Net~~Value ~~Trading~~of ~~Profits”~~a ~~generated~~Financial byAsset ~~each~~When ~~trading~~the ~~manager,~~Market asfor ~~defined~~That inAsset Is Not Active” (“FSP FAS 157-3”). FSP FAS 157-3 clarified the ~~advisory~~application ~~agreements~~of ~~among~~SFAS 157. FSP FAS 157-3 demonstrated how the ~~Trust,~~fair value of a financial asset is determined when the ~~Managing~~market ~~Owner~~for ~~and~~that ~~each~~financial ~~trading~~asset ~~manager~~is inactive. ~~Incentive fees~~FSP ofFAS ~~approximately~~157-3 ~~$31,000,~~was ~~$131,000~~effective ~~and~~upon ~~$12~~issuance,~~000~~ ~~were~~including ~~incurred~~prior byperiods ~~the~~for ~~Trust~~which ~~for~~financial statements had not been issued. The Managing Owner evaluated the ~~years~~impact ~~ended~~of ~~December~~adopting FSP ~~31,~~FAS 157-3 ~~2005,~~and ~~2004~~its ~~and~~impact ~~2003,~~on ~~respectively~~the Registrant’s financial statements. The adoption of this standard did not have an impact on the Registrant’s financial statements.

~~Inflation~~In February 2007, the FASB issued SFAS No. 159 (“SFAS 159”), “The Fair Value Option for Financial Assets and Financial Liabilities”, including an amendment of SFAS 115. This statement provides companies with an option to report selected financial assets and liabilities at fair value. This statement is effective for fiscal years beginning after November 15, 2007 with early adoption permitted. The Managing Owner evaluated the impact of adopting SFAS 159 and its impact on the Registrant’s financial statements. The Registrant adopted SFAS 159 during the first quarter of 2008, and it did not have a material effect on the Registrant’s financial statements, as the Registrant did not elect the fair value option for any eligible financial assets or liabilities.

~~Inflation~~In ~~has~~April ~~had~~2007, nothe ~~material~~FASB ~~impact~~released onFASB ~~operations~~Staff orPosition onFIN No. 39-1 ~~the~~“Offsetting ~~financial~~of ~~condition~~Amounts Related to Certain Contracts” (“FSP FIN 39-1”). FSP FIN 39-1 requires that offsetting of assets and liabilities in the ~~Trust~~balance ~~from~~sheet ~~inception~~is ~~through~~improper except where a right of setoff exists. ~~December~~The application of FSP FIN 39-1 is required for fiscal years beginning after November 3115, ~~2005~~2007 and interim period within those fiscal years. The Managing Owner evaluated the impact of adopting of FSP FIN 39-1 and its impact on the Registrant’s financial statements. The adoption of this standard did not have an impact on the Registrant’s financial statements.

In March 2008, ~~Item~~the FASB issued SFAS No. 7A161, “Disclosures about Derivative Instruments and Hedging Activities – an amendment of FASB Statement No. 133” ~~Quantitative~~(“SFAS 161”). SFAS 161 establishes, among other things, the disclosure requirements for derivative instruments and ~~Qualitative~~for ~~Disclosures~~hedging ~~About~~activities. ~~Market~~SFAS ~~Risk~~161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The Managing Owner evaluated the impact of adopting SFAS 161 and its impact on the Registrant’s financial statements. The adoption of this standard is not expected to have an impact on the Registrant’s financial statements

~~Information~~Liquidity ~~regarding quantitative~~ and ~~qualitative disclosures~~Capital ~~about~~Resources ~~market risk is not required pursuant to Item 305(e) of Regulation S-K.~~

Registrant commenced operations on ~~Item~~May 81, 1996 with gross proceeds of $12,686,200 allocated to commodities trading. ~~Financial~~Additional ~~Statements~~contributions raised through the continuous offering of limited interests (“Limited Interests”) and ~~Supplementary~~general ~~Data~~interests (“General Interests” and, together with the Limited Interests, “Interests”) of beneficial ownership in Registrant through January 31, 1998 resulted in additional gross proceeds to Registrant of $51,242,700, including $375,000 of contributions from the Managing Owner. The continuous offering period expired on January 31, 1998.

The ~~financial~~Trust ~~statements~~Agreement ~~are~~provides ~~incorporated~~that bya ~~reference~~unitholder tomay redeem ~~pages~~its 3Interests as of the last day of any month at the then current net asset value per Interest. Redemptions of Limited Interests recorded for the years ended December 31, 2008, 2007 and 2006 were $680,350, $1,468,995 and $780,804, ~~through~~respectively. 6Redemptions of General Interests by the ~~Registrant’s~~Managing ~~2005~~Owner ~~Annual~~for ~~Report~~the ~~which~~years isended ~~filed~~December 31, as2008, an2007 ~~exhibit~~and ~~hereto~~2006 were $7,531, $15,147 and $7,920, respectively. Future redemptions will impact the amount of funds available for investment in commodity contracts in subsequent periods.

~~Selected~~12 ~~unaudited quarterly financial data for the years ended December 31, 2005 and 2004 are summarized below:~~

	FirstQuarter			SecondQuarter			ThirdQuarter		FourthQuarter
2005:
Total revenues (including interest)	$	3,544		$	(130,710	)	$	210,554	$	(41,032	)
Total revenues (including interest) less commissions	$	(134,481	)	$	(260,291	)	$	90,375	$	(156,558	)
Net income (loss)	$	(191,510	)	$	(284,205	)	$	67,681	$	(178,669	)
Net income (loss) per weighted average Interest	$	(2.76	)	$	(4.19	)	$	1.04	$	(2.95	)
2004:
Total revenues (including interest)	$	567,963		$	(642,054	)	$	182,292	$	1,025,676
Total revenues (including interest) less commissions	$	416,331		$	(785,565	)	$	52,569	$	891,318
Net income (loss)	$	298,119		$	(811,903	)	$	28,256	$	822,052
Net income (loss) per weighted average Interest	$	3.83		$	(10.71	)	$	0.39	$	11.69

~~Item~~At December 931, 2008, 99.38% ~~Changes~~of Registrant’s net assets were allocated to commodities trading through its investment in the Trading Vehicle. A significant portion of Registrant’s net assets invested in the Trading Vehicle was held in cash, which was used as margin for trading in commodities. In as much as the sole business of Registrant is to trade in commodities (through its investment in the Trading Vehicle), Registrant continues to own such liquid assets to be used as margin. The clearing broker and ~~Disagreements~~bank credit Registrant (either directly or through the Trading Vehicle) with ~~Accountants~~interest income on ~~Accounting~~100% of its average daily equity maintained in its accounts with the clearing broker and ~~Financial~~bank ~~Disclosure~~during each month at competitive interest rates.

OnThe commodities ~~October 18,~~contracts ~~2005, the~~may ~~Board~~be ofsubject ~~Directors~~to periods of ~~Preferred~~illiquidity ~~dismissed~~because ~~Arthur~~of F.market ~~Bell~~conditions, Jrregulatory considerations and other reasons. & ~~Associates~~For example, ~~L.L.C.~~commodity (exchanges limit fluctuations in certain commodity futures contract prices during a single day by regulations referred to as “~~AFB~~daily limits.”) asDuring ~~the~~a ~~independent~~single ~~registered~~day, ~~public~~no ~~accounting~~trades ~~firm~~may ~~for~~be executed at prices beyond the ~~Registrant~~daily limit. ~~The~~Once ~~report~~the price of ~~AFB~~a onfutures ~~the~~contract ~~Registrant’s~~for ~~financial~~a particular commodity has increased or decreased by an ~~statements~~amount asequal ofto ~~and~~the ~~for~~daily limit, positions in the ~~fiscal~~commodity ~~year~~can ~~ended~~neither ~~December 31,~~be ~~2004~~taken ~~did~~nor ~~not~~liquidated ~~contain~~unless antraders ~~adverse~~are ~~opinion~~willing to effect trades at or awithin ~~disclaimer~~the oflimit. ~~opinion,~~Commodity ~~and~~futures ~~was~~prices ~~not~~have ~~qualified~~occasionally ormoved ~~modified~~the asdaily tolimit ~~uncertainties,~~for ~~audit~~several consecutive ~~scope,~~days with little or ~~accounting~~no ~~principles~~trading. ~~AFB~~Such ~~was~~market ~~engaged~~conditions ~~by Futures~~could ~~Strategic~~prevent ~~Trust~~the onTrading ~~October 1~~Vehicle (and, ~~2004~~in turn, Registrant) from promptly liquidating its commodity futures positions.

~~During~~Since ~~the~~ Registrant’s ~~most~~business ~~recent~~is ~~fiscal~~to ~~year~~trade ~~ended~~futures ~~December 31,~~and ~~2004~~forward ~~and~~contracts ~~during~~(through its investment in the ~~period then~~Trading ~~ended~~Vehicle), ~~through~~its capital is at risk due to changes in the ~~date~~value of these contracts (market risk) or the inability ~~most~~of ~~recently~~counterparties ~~filed~~to ~~Form~~perform ~~8-K,~~under the ~~Registrant~~terms ~~and~~of the ~~Managing~~contracts ~~Owner~~(credit ~~have~~risk). ~~had~~Registrant’s noexposure ~~disagreements~~to ~~with~~market ~~AFB~~risk onis ~~any~~influenced ~~matter~~by a number of ~~accounting~~factors ~~principles~~including orthe ~~practices,~~volatility ~~financial~~of ~~statement~~interest ~~disclosure,~~rates orand ~~auditing~~foreign ~~scope~~currency ~~or procedure~~exchange rates, the liquidity of the markets in which ~~disagreement(~~the contracts are traded and the relationships among the contracts held. The inherent uncertainty of Registrant’s), ifspeculative ~~not~~trading ~~resolved~~as towell as the ~~satisfaction~~development of ~~AFB,~~drastic ~~would~~market ~~have~~occurrences ~~caused~~could itresult in losses considerably beyond Registrant’s experience to ~~make~~date and could ultimately lead to a ~~reference~~loss of all or substantially all of investors’ capital. The Managing Owner attempts to minimize these risks by requiring Registrant, the ~~subject~~Trading Vehicles ~~matter~~and ~~thereof~~Trading Advisors to abide by various trading limitations and policies, which include limiting margin amounts, trading only in ~~its~~liquid ~~report~~markets onand permitting the use of stop loss provisions. See Note 7 to the financial statements offor a further discussion on the credit and market risks associated with Registrant’s ~~for~~futures ~~such~~and ~~period~~forward contracts.

13Market Overview

OnFollowing ~~October 18,~~is ~~2005,~~a ~~the~~market ~~Board~~overview ~~of Directors of the Managing Owner, on behalf of the Registrant, approved the engagement of Deloitte & Touche LLP (“D&T”) as the independent registered public accounting firm~~ for the ~~Registrant. During the Registrant’s two most recent fiscal~~ years ~~and~~ended ~~the interim period prior to engaging D&T~~December 31, ~~neither~~ ~~the Registrant~~2008, ~~the Managing Owner~~ December 31, ~~nor~~2007 anyone on their behalf consulted D&T, on behalf of the Registrant, regarding the application of accounting principles to a specified transaction (either completed or proposed), the type of audit opinion that might be rendered on the Registrant’s financial statements, or any matter that was either the subject of a “disagreement,” as defined in Item 304(a)(1)(iv) of Regulation S-K and ~~the instructions thereto~~December 31, or2006: ~~a “reportable event,” as defined in Item 304(a)(1)(v) of Regulation S-K.~~

~~Item 9A.~~The ~~Controls~~Year ~~and~~Ended ~~Procedures~~December 31, 2008

As2008 was ofa watershed year for the world economy and the financial industry. It marked the end of an era for the ~~period~~world ~~covered~~economy—an byera ~~this~~of ~~report~~rising leverage, ~~the~~bloated ~~Managing~~balance ~~Owner~~sheets, ~~carried~~inflated ~~out~~asset ~~an evaluation~~valuations, ~~under~~and ~~the~~above ~~supervision~~all, a dangerously unbalanced international economic and ~~with~~financial arrangement that was heavily reliant on the ~~participation~~American consumer as the buyer of last resort. The financial market upheavals of the ~~officers~~past year, rivaled only by those of the ~~Managing~~Great ~~Owner~~Depression, ~~including~~smashed the ~~Managing~~aging ~~Owner’s~~edifice of ~~chief~~the ~~executive~~old ~~officer,~~era. ~~chief~~The ~~financial~~pain ~~officer~~was ~~and~~all ~~director~~the ofmore ~~fund~~acute ~~administration~~for the financial sector, ofwhere the ~~effectiveness~~yearlong ofnightmare ~~the design~~was ~~and~~topped ~~operation~~off ofby the ~~Registrant’s~~eruption ~~disclosure~~of ~~controls~~the ~~and~~Bernie ~~procedures~~Madoff scandal. ~~Based~~Thanks ~~upon~~to ~~that~~the ~~evaluation,~~dramatic ~~the~~monetary ~~Managing~~and ~~Owner’s~~fiscal ~~chief~~policy ~~executive~~moves ~~officer~~worldwide, ~~chief~~most ~~financial~~notably ~~officer~~by the ~~and~~US ~~director~~Federal ofReserve, ~~fund~~the ~~administration~~US ~~concluded~~is ~~that~~unlikely to repeat the ~~Registrant~~ Depression of the 1930’s. ~~disclosure~~However, ~~controls~~the liquidity environment is likely to remain challenged and ~~procedures~~a ~~are~~sustainable ~~effective~~economic recovery may well not begin until 2010.

~~There~~The ~~have~~US ~~not~~economic ~~been~~data ~~any~~reported ~~changes~~throughout the year were horrendous. The US economy lost 2.6 million jobs in ~~our~~2008, ~~internal~~the ~~controls~~most ~~over~~since ~~financial~~1945. ~~reporting~~Of ~~(as~~these, 1.9 million ~~defined~~jobs were lost in ~~Rules~~the ~~13a-15(e)~~last ~~and~~few ~~15d~~months –of ~~15(e)~~the ~~under~~year. The unemployment rate jumped to over 7% to end the ~~Securities~~year, ~~and~~which ~~Exchange~~is ~~Act~~the highest it has been in sixteen years. The latest reported US housing prices showed a drop of ~~1934,~~over as15% ~~amended)~~from ~~during~~January ~~the~~2008 ~~fiscal~~through October ~~quarter~~2008 toand ~~which~~a ~~this~~30% ~~report~~decline ~~related~~from ~~that~~January ~~have~~2007 ~~materially~~through ~~affected~~October 2008 was reported. At year end, orhousing ~~are~~starts ~~reasonable~~were ~~likely~~at tothe ~~materially~~lowest ~~affect~~levels in 50-years and housing permits, ~~our~~one of the leading economic indicators, were at 27-year lows. Retail sales ~~internal~~struggled ~~controls~~through ~~over~~2008 ~~financial~~and ~~reporting~~capped the year with one of the worst holiday seasons on record.

According to the Merrill Lynch Index, treasuries of all ~~Item 9B~~maturities combined returned almost 15% in 2008. ~~Other~~The ~~Information~~Federal Reserve added additional liquidity and slashed the Federal Discount Rate to a 0.0%—0.25% range during December. For the first half of the year, the Federal Reserve Open Market Committee lowered rates in attempts to improve market conditions due to the sub-prime mortgage crisis. Additional rate reductions were geared to stimulate the economy in the face of the global credit crisis as numerous financial institutions announced faltering operations during the last few months of 2008. As a result, the Discount Rate and Federal Funds Rate decreased over 4% throughout the year.

~~None~~As the housing and credit markets around the globe crumbled, the world’s central banks worked collaboratively and lowered key rates throughout 2008. The Bank of England, faced with a deepening banking crisis and recession, lowered their rate by approximately 3.5% throughout the year. Even the President of the European Central Bank (“ECB”), Jean Claude Trichet, had to abandon his long term hawkish stance as the ECB lowered rates to 2.0% by year end. The scene was all too familiar in Asia as the Peoples Bank of China and the Bank of Japan lowered rates in 2008.

Currencies: The Dollar Index, which measures ~~PART~~the ~~III~~US unit against a basket of other currencies, capped off the year by gaining roughly 6%. The greenback’s most noteworthy gains were concentrated on the euro, pound and Australian and New Zealand

~~Item 10.~~13 ~~Directors and Executive Officer of the Registrant~~

dollars. The ~~key~~US ~~officers~~dollar ofcontinued to decline versus the ~~Managing~~Japanese ~~Owner~~yen in December and ~~their~~fell ~~positions~~approximately 19% for the year, the largest decline in more than ~~with~~twenty ~~respect~~years. Japan appeared to be significantly less exposed to the ~~Registrant~~credit ~~are~~crisis compared to the US, England, European Union, China and other nations as ~~follows:~~the yen witnessed gains across the board in 2008. Though the euro lost value versus the US dollar in 2008, it ended the year with record performance versus the pound. The pound was the weakest among major currencies versus the US dollar with an approximate 27% slide during the year.

~~Mr. Kenneth A.~~Energies: ~~Shewer~~After ~~(born~~crude ~~1953),~~reached ~~has~~a ~~been~~record high close of over $145 a ~~principal~~barrel on July 3, ~~associated~~the ~~person~~deleveraging and ~~NFA associate~~a ~~member~~severe ofdrop ~~the~~off ~~Managing~~in ~~Owner~~demand ~~since~~caused ~~February 8,~~the ~~1984, May 1,1985~~price ~~since~~of ~~August 1,~~crude to ~~1985, respectively~~plummet. HeWithin ~~has~~the ~~been~~Dow ~~Chairman~~Jones ~~and~~AIG ~~Co-Chief~~Commodity ~~Executive~~Index ~~Officer~~(“DJAIG”) crude was one of the ~~Managing~~worst ~~Owner~~performing ~~since~~sectors ~~February~~in ~~1984.~~2008, ~~Mr. Shewer~~posting ~~was employed~~losses in excess of 50% by ~~Pasternak,~~closing ~~Baum~~the ~~and~~year ~~Co.,~~near ~~Inc~~$45 a barrel. Crude continued to slide despite significant OPEC (~~“Pasternak,~~Organization ~~Baum”),~~of anthe ~~international~~Petroleum ~~cash~~Exporting ~~commodity~~Countries) ~~firm~~supply decreases in September, ~~from~~in ~~June~~October ~~1976~~and ~~until~~again ~~September~~in ~~1983~~December. ~~Mr. Shewer~~Heating ~~created~~oil and ~~managed~~reformulated ~~Pasternak,~~gasoline ~~Baum’s~~had ~~Grain~~similar ~~Logistics~~2008 ~~and~~price ~~Administration~~trends. Reformulated gasoline posted the worst ~~Department~~performance ~~and~~within ~~created~~the ~~its~~DJAIG ~~Domestic~~with ~~Corn~~losses ~~and~~amounting ~~Soybean~~to ~~Trading~~roughly ~~Department.~~60% Mrfor the year. ~~Shewer’s~~ ~~responsibilities~~Natural atgas ~~Pasternak,~~witnessed ~~Baum~~handsome ~~included~~returns ~~merchandising~~through ~~South~~July ~~American~~as ~~grain~~the ~~and~~price ~~exporting~~of ~~United~~domestic ~~States~~natural ~~corn~~gas ~~and~~surged ~~soybeans.~~from Inthe ~~1982,~~first ~~Mr. Shewer became~~quarter ~~co-manager~~and ofrallied ~~Pasternak,~~over ~~Baum’s~~70% ~~F.O.B.~~for ~~Corn~~the ~~Department~~year. ~~In 1983~~However, ~~Mr. Shewer~~like other ~~was~~commodities, ~~made~~the ~~Vice~~global ~~President~~economic ~~and~~malaise ~~Director~~caused ofdemand ~~Pasternak,~~to ~~Baum.~~drop ~~Mr. Shewer~~off ~~has~~considerably ~~traveled~~leading ~~extensively~~to indramatic ~~South~~price ~~America~~reductions ~~and~~throughout ~~Europe~~the insecond ~~connection~~half ~~with~~of the ~~commodity~~ ~~business~~year. ~~and~~The ~~has~~dispute ~~organized~~between Russia and ~~effected~~the ~~grain~~Ukraine, ~~and~~which ~~oilseed~~disrupted ~~sales~~the insupply ~~those~~of ~~regions,~~natural ~~the~~gas to ~~former~~Central ~~Soviet~~and ~~Union~~Eastern Europe during December, ~~and~~had ~~the~~little ~~Far~~impact ~~East~~on price. ~~While~~Within atthe ~~Pasternak~~DJAIG, ~~Baum,~~natural ~~Mr. Shewer~~gas ~~was~~realized a ~~member~~loss ofnear ~~the~~25% ~~St.~~for ~~Louis~~the ~~Merchants~~year, ~~Exchange~~which ~~and~~ was ~~associated with~~ the ~~National~~best ~~Grain~~performance ~~and~~for ~~Feed~~all ~~Association~~energies ~~and~~within the ~~North American Export Grain Association~~Index.

~~Mr. Shewer~~Agriculturals: ~~graduated~~Wheat, ~~from~~corn, ~~Syracuse~~soybeans ~~University~~and cotton ended the year with astrong ~~B.S. degree~~overall inreturns ~~1975.~~for ~~Mr. Shewer~~December ~~sits~~but onall ~~the~~suffered ~~Board~~rather ofdisappointing returns for the year. ~~Stacy~~Overall ~~Joy~~for ~~Goodman~~2008, ~~Memorial~~wheat, ~~Foundation~~corn, asoybeans ~~non-profit~~and ~~charity~~cotton ~~committed~~ended tothe ~~finding~~period adown ~~cure~~approximately ~~for~~31%, ~~Juvenile~~11%, ~~Diabetes~~19% and 28%, respectively, within the DJAIG. HeWheat isgained ~~also~~early ain ~~member~~the year on fears of feed grain shortage but record annual harvest, followed by the ~~Board~~wheat deleveraging that occurred in the second half of the ~~Diabetes~~year ~~Research~~due ~~Institute~~to ~~Foundation~~the global financial meltdown, aled to increased supplies plaguing silos across the globe. The ethanol story, the growing potential of an eventual global food shortage and ~~not-for-profit~~capital ~~organization~~flows ~~affiliated~~into ~~with~~commodities, were all factors behind corn’s rally in the ~~University~~first half of ~~Miami~~2008 ~~School~~that seemed to disappear in the third and fourth quarters of ~~Medicine.~~the Mryear. ~~Shewer~~ isDespite aexcessive ~~founding~~precipitation ~~member~~across the central bean belt and ~~member~~increased demand offrom China, which lent support for soybeans’ performance realized during the ~~Board~~first ofand second quarters, all gains were erased in the ~~Greenwich~~third ~~Roundtable~~and fourth quarters.

MrIndices: The global equity performance for 2008 in general can be described as dreadful. ~~Marc S~~ The year started off poorly and the markets just got worse. ~~Goodman~~Many ~~(born~~market ~~1948)~~participants ~~has~~fell ~~been~~victim ato ~~principal,~~forced ~~associated~~selling ~~person~~as massive capital outflows continued through year end. The global credit crisis and ~~NFA~~the ~~associate~~recession ~~member~~worsened, but a flake of ~~the~~relief ~~Managing~~emerged ~~Owner~~as ~~since~~central ~~February 7,~~banks ~~1984, May 1,~~worked ~~1985~~collaboratively ~~since~~and ~~August 1,~~lowered ~~1985~~key rates, ~~respectively.~~ Headded ~~has~~substantial ~~been~~liquidity ~~President~~ and ~~Co-Chief~~enacted ~~Executive~~stimulus packages ~~Officer~~during the final months of the ~~Managing~~year ~~Owner~~with ~~since~~more ~~February~~promised ~~1984.~~for Mr2009. ~~Goodman~~ ~~joined~~The ~~Pasternak,~~result ~~Baum~~for inthe ~~September~~major ~~1974~~US ~~and~~indices was a ~~Vice~~modest ~~President~~advance ~~and~~in ~~Director~~December ~~from~~as ~~July~~the ~~1981~~Dow ~~until~~Jones ~~September~~Industrial ~~1983.~~Average ~~While at~~posted ~~Pasternak,~~a ~~Baum~~slight gain; however, Mrit ended the year down approximately 34%. ~~Goodman~~ ~~was~~The ~~largely~~S&P ~~responsible~~500 ~~for~~ended ~~business~~December ~~development~~with ~~outside~~an ofadvance but posted an approximate 37% loss for the ~~United~~year. ~~States~~For December, ~~for~~the ~~investment~~NASDAQ recorded positive overall performance but technology stocks were a major victim of ~~its~~the ~~corporate~~global ~~retirement~~economic ~~funds,~~collapse and realized ~~for~~an ~~selecting~~approximate ~~trading~~40% ~~personnel~~loss infor the ~~Vegetable~~year. ~~Oil~~In ~~Division~~Europe, ~~Mr. Goodman also~~the ~~created~~DAX and ~~developed~~CAC ~~Pasternak~~witnessed positive performance in December; however, ~~Baum’s~~they ~~Laric~~posted ~~Oils~~losses ~~Department.~~of Mrapproximately 40% and 43%, respectively, for the year. ~~Goodman~~ ~~has~~The ~~conducted~~London ~~extensive~~FTSE ~~business~~and Russian equities finished December and the year with negative returns. The three majors in ~~South~~Asia ~~America~~— the Nikkei, ~~Europe~~Hang Seng and ~~the~~Kospi ~~Far~~— ~~East;~~ended he2008 ~~has~~on ~~been~~ a ~~merchandiser~~rally ofbut ~~all~~down ~~major~~considerably ~~vegetable~~for ~~oils~~the year. Australia and ~~their~~New ~~by-products,~~Zealand ~~and of~~witnessed ~~various~~steep ~~other~~losses ~~commodities~~in ~~such~~2008 as ~~sunflower~~well. ~~seeds,~~The ~~frozen~~Latin American ~~poultry,~~block ~~pulses~~was hit hard by the economic meltdown as the Mexican Bolsa Index and ~~potatoes~~the Brazilian Bovespa Stock Index closed the year down considerably.

14Metals: Gold posted strong performance as the precious metal advanced approximately 8% in December and finished 2008 up almost 5%. Asian and geopolitical buying, flight-to-safety, strong European dealer demand and small losses in the US Dollar Index all factored into gold’s run in December. Silver, platinum and palladium all recorded gains in December; however, silver posted large losses within the DJAIG on the year. Among base metals, 2008 was a terrible year across the board. The global housing and commercial real-estate market collapse and the looming economic recession caused demand for these metals to grind to a halt. Also, large inventories of these metals drove the prices down further. Within the DJAIG, aluminum, zinc, copper and nickel wrapped up the year down approximately 36%, 49%, 54% and 55%, respectively.

~~Mr. Goodman~~Softs ~~graduated~~and ~~from~~Livestock: ~~the~~Sugar ~~Bernard~~featured M.a relatively ~~Baruch~~quiet ~~School~~December ofand ~~Business~~lost ofabout ~~the~~1% ~~City~~overall ~~University~~for ofthe ~~New~~month ~~York~~as ~~with~~abundant asupply Bprevailed.~~B.A. in~~ ~~1969~~However, ~~and~~sugar anwas ~~M.B.A.~~the inleading ~~1971~~commodity in ~~Finance~~the DJAIG and ~~Investments,~~witnessed ~~where~~an heoverall ~~was~~gain ~~awarded~~of anover ~~Economics~~9% ~~and~~for ~~Finance~~the ~~Department~~year. ~~Fellowship~~Coffee ~~from~~and ~~September~~cocoa ~~1969~~ended ~~through~~a ~~June~~miserable ~~1971.~~year Mrwith negative overall performance. ~~Goodman~~ isAs athe ~~member~~global ofeconomy ~~the~~worsened, ~~American~~beef ~~Arbitration~~demand ~~Association;~~continued ~~while~~to ~~at Pasternak~~fall, ~~Baum,~~resulting hein ~~was~~cattle prices dropping by a ~~member~~disappointing of12% within the ~~National~~DJAIG ~~Institute~~for the year. Hogs were one of ~~Oilseeds~~the ~~Products~~few ~~and~~sectors within the ~~American~~DJAIG ~~Fats~~to ~~and~~cap ~~Oils~~the ~~Association~~year with ~~(including~~overall ~~its~~positive ~~Export~~returns. ~~Rules~~Demand ~~Committee)~~increases, mainly in China, drove hog prices up over 5% in 2008 within the DJAIG.

~~Mr. Goodman~~The is the Chairman of the Board of the Stacy Joy Goodman Memorial Foundation, a non-profit charity committed to finding a cure for Juvenile Diabetes. He is also Chairman of the Board of the Diabetes Research InstituteYear ~~Foundation,~~Ended ~~a not-for-profit organization which is the principle source of funding for the Diabetes Research Institute~~December 31, a2007 ~~world renowned cure based research center affiliated with the University of Miami School of Medicine.~~

MrThe global economy endured the unfolding of the subprime credit crisis for most of 2007. ~~Goodman~~ isAugust a2007 ~~founding~~will ~~member~~forever be etched in the financial pantheon alongside 1998 and ~~member~~1987 as defining events of their respective decades. The US economy has cooled considerably since the ~~Board~~beginning of the ~~Greenwich~~year ~~Roundtable~~ and ismany economists are signifying a ~~member~~“recessionary oflike” outlook at best in the ~~Board~~coming months, not the “soft landing” that was anticipated. While the US economy proved volatile throughout the year, the rest of ~~Xethanol~~the ~~Corp~~world appeared to be going strong.

~~Messrs.~~14 Shewer and Goodman left Pasternak, Baum in September 1983 to form Kenmar Advisory Corp. (now known as Preferred Investment Solutions Corp., the Managing Owner) and they have occupied their present positions with the Managing Owner since that time.

~~Mr. Braxton~~During ~~Glasgow III (born 1953)~~2007, ~~has~~single-family ~~been~~housing astarts ~~principal, associated person, branch manager~~ and ~~NFA~~permits ~~associate~~hit ~~member~~sixteen-year oflows ~~the~~as ~~Managing~~starts ~~Owner~~fell ~~since~~over ~~June 21,~~5% ~~2001, June 21, 2001, July 13, 2004~~ and ~~June 8,~~are ~~2001,~~approximately 24% ~~respectively.~~below Mr2006. ~~Glasgow~~ ~~has~~The ~~been~~Home anBuilders ~~Executive~~Confidence ~~Vice~~Index ~~President~~witnessed of the ~~Managing~~lowest ~~Owner~~drawdown ~~since joining the Managing Owner~~ in ~~May~~nineteen ~~2001~~years. ~~Mr. Glasgow~~In ~~is responsible for business development. Previously~~November, heUK ~~served~~housing asprices ~~Executive~~showed ~~Vice~~their ~~President,~~greatest ~~Director~~monthly ofdive ~~Client~~in ~~Services~~twelve ~~and~~years ~~a Principal at Chesapeake Capital Corp., a commodities trading firm, and~~ as ~~Senior~~the ~~Managing~~subprime ~~Director~~crisis atclearly ~~Signet~~impacted ~~Investment~~non-US ~~Banking Co~~markets. ~~Mr. Glasgow began his career at PricewaterhouseCoopers, where he specialized in mergers and acquisitions and private equity, including extensive work in~~Inflation ~~Europe~~concerns ~~and~~led ~~the~~to ~~Far East. Mr. Glasgow received a B.S. in Accounting from~~ the ~~University~~Bank of ~~North~~England ~~Carolina~~(“BOE”) ~~at Chapel Hill and is a Certified Public Accountant. From 1994~~ to ~~1995,~~cut herates ~~was~~late ~~President of the Jay Group Ltd. Mr. Glasgow received a B.S. degree~~ in ~~accounting from the University of North Carolina in 1975~~2007.

~~Ms. Maureen D.~~In ~~Howley (born 1967), has been a principal of~~ the ~~Managing~~ ~~Owner since August 11~~US, ~~2003. She has been a Senior Vice President and Chief Financial Officer of~~ the ~~Managing~~unemployment ~~Owner~~rate ~~since~~unexpectedly ~~joining~~jumped ~~the~~to ~~Managing Owner in July 2003~~5. ~~She is responsible for corporate finance. From July 2001 until July~~0% ~~2003,~~during ~~Ms. Howley~~the ~~was~~fourth anquarter ~~Associate~~as atprivate ~~Andor~~sector ~~Capital~~payrolls ~~Management~~fell, ~~LLC,~~signaling anthe ~~equity~~first ~~hedge~~decline ~~fund~~in ~~company.~~four ~~At Andor, she was responsible for managing the corporate accounting functions~~years. ~~Previously,~~For ~~she was~~ the ~~Controller~~first attime ~~John~~since W.September ~~Henry & Company~~2003, ~~Inc.,~~fewer athan ~~commodity-trading~~half ~~advisor (“JWH”), where she held positions~~ of ~~increasing responsibility from September 1996 to July 2001. She began her career at Deloitte & Touche where she specialized in~~ the ~~financial~~industries ~~services industry.~~surveyed ~~She~~added ~~held many positions of increasing responsibility for seven years, and left as an Audit Senior Manager in September 1996 to join JWH~~jobs. ~~Ms. Howley received a B.A. in Accounting from Muhlenberg College in 1989 and designation as a Certified Public Accountant in 1990.~~

~~Mr. Lawrence S.~~Currencies: ~~Block~~While ~~(born~~the ~~1967)~~US ~~has~~dollar ~~been~~managed aperiodic ~~Senior~~strength ~~Vice~~during ~~President~~December, ~~and General Counsel of~~ the ~~Managing~~ ~~Owner~~dollar ~~since~~ended ~~joining~~2007 ~~the~~with ~~Managing~~staggering ~~Owner~~losses into ~~March~~major ~~2005~~rivals. ~~Prior~~The tofinal ~~joining~~2007 tally saw the ~~Managing Owner~~euro, ~~Mr. Block~~pound ~~was a Managing Director~~ and ~~General~~yen ~~Counsel~~gaining ofover ~~Lipper & Company~~10%, ~~L.P.,~~6% aand ~~New York-based investment management firm~~2%, ~~from January 1998 until March 2005~~respectively. ~~Prior~~After towitnessing ~~joining Lipper & Company, Mr. Block was~~ a ~~senior~~record ~~associate~~monthly atlow ~~the~~in ~~law firm Cadwalader~~November, ~~Wickersham &~~the ~~Taft~~Dollar inIndex ~~New~~ended ~~York~~the ~~from~~year ~~May~~over ~~1996 through December 1997~~76. Mr5. ~~Block~~ ~~also~~Throughout ~~worked as an associate at~~ the ~~law~~year, ~~firm~~emerging ~~Proskauer~~nations ~~Rose~~gained ~~Goetz &~~greater ~~Mendelsohn~~confidence ~~from September 1992 through May 1996. Mr. Block received a B.S.~~ in ~~Business~~their ~~Administration with a concentration in Accounting from the University of North Carolina at Chapel~~domestic ~~Hill~~economic ~~in 1989 and a J~~strength.D. ~~from~~Many, ~~the~~especially ~~University of Pennsylvania School of Law~~ in ~~1992. Mr. Block’s registration as a principal of the Managing Owner has been effective since March 17~~Asia, ~~2005.~~slowly ~~His~~abandoned ~~registration as an Associated Person of~~ the ~~Managing~~ ~~Owner~~managed isdollar ~~pending with the National Futures Association~~peg.

15The pound finished the year with gains on the dollar, despite losses in December as a result of a BOE rate decrease. The euro had a strong year and benefited from perceptions that the European Central Bank (“ECB”) would not be lowering rates any time soon as ECB President Jean Claude Trichet issued a series of hawkish comments, mainly as related to inflation concerns. European Union economic data was mixed to weak, including a twenty-two month low reading of the German IFO Business Confidence Index.

~~Ms. Joanne D.~~The ~~Rosenthal~~yen ~~(born~~closed ~~1965),~~out ~~has~~2007 ~~been~~up a2% ~~principal,~~for ~~associated~~the ~~person~~year ~~and~~on ~~NFA associate member of~~ the ~~Managing~~US ~~Owner since February 29, 2000, February 29, 2000 and November 30, 1999, respectively~~dollar. ~~Ms. Rosenthal~~Japanese iseconomic ~~Senior~~data ~~Vice~~persisted ~~President~~as lackluster and ~~Director~~those ofcalling ~~Portfolio~~for ~~Management~~a ~~and~~rate ~~Implementation~~increase ~~for~~have ~~the~~now ~~Managing~~mostly ~~Owner. Prior~~backed toaway ~~joining~~from ~~the~~that ~~Managing~~forecast. ~~Owner~~The inyuan ~~October~~extended ~~1999,~~its ~~Ms. Rosenthal~~yearlong ~~spent~~gradual ~~nine~~advance ~~years~~in atDecember ~~The~~as ~~Chase~~the ~~Manhattan~~Peoples Bank, inof ~~various~~China ~~positions~~continued ofto ~~increasing responsibility~~contract. ~~From~~Since ~~July~~abandonment ~~1991~~of ~~through April 1994, she managed~~ the ~~Trade~~US ~~Execution~~dollar ~~Desk~~peg ~~and~~in ~~from~~January ~~May 1994 through September 1999~~2005, ~~she~~the ~~was~~yuan ahas ~~Vice~~risen ~~President~~12% ~~and~~to ~~Senior~~the ~~Portfolio Manager of Chase Alternative Asset Management, Inc~~dollar. ~~Ms. Rosenthal~~The ~~received a Masters of Business Administration with a concentration in Finance from Cornell University~~Canadian, Australian and aNew ~~Bachelor~~Zealand ofdollars ~~Arts~~posted ingains ~~Economics~~on ~~from~~the ~~Concordia~~year ~~University~~against inthe ~~Montreal,~~US ~~Canada~~dollar.

~~Mr. Peter J.~~Energies: ~~Fell~~It ~~(born~~was ~~1960),~~a ~~Senior~~tremendous ~~Vice~~year ~~President, Director~~for ofthe ~~Due~~petroleum ~~Diligence~~sector ~~since~~as crude ~~joining~~oil ~~the~~prices ~~Managing~~rose ~~Owner~~more inthan ~~September~~40% ~~2004.~~within Hethe isDow ~~responsible~~Jones ~~for~~AIG ~~manager~~Index ~~selection~~ and ~~due~~closed ~~diligence.~~2007 Mrover $95. ~~Fell~~ isCrude abriefly ~~member~~reached of the ~~Investment~~ominous ~~Committee.~~$100 ~~From~~level ~~2000~~but ~~through~~the ~~August~~market ~~2004,~~failed ~~Mr. Fell~~to ~~was~~hold ~~a founding~~that ~~partner~~level ~~and~~in ~~Investment~~initial ~~Director of Starview Capital Management~~efforts. ~~Prior~~Geopolitical toevents ~~co-founding~~were ~~Starview~~supportive ~~Capital~~during ~~Management~~the year, ~~Mr. Fell~~encouraging ~~was~~the ~~Vice~~high ~~President~~volatility ofpatterns. ~~Research~~Supply/demand ~~and~~fundamentals ~~Product~~have ~~Development~~been attrending ~~Merrill~~weaker ~~Lynch~~and ~~Investment Partners Inc (MLIP). He was responsible for~~ the ~~investment~~market ~~evaluation~~saw ~~and~~periodic ~~recommendation~~selling ~~process~~as ~~pertaining~~related to ~~MLIP~~concerns ~~funds~~surrounding ~~and~~slowing ~~sat~~US onand ~~MLIP’s~~global ~~Investment Committee~~growth. ~~Prior~~The toUS ~~joining~~dollar ~~MLIP,~~remained ~~Mr. Fell~~a ~~had~~key ~~been~~influence ~~with~~and ~~Deutsche Bank Financial Products Corporation for six years~~the ~~starting~~dollar’s indemise ~~1989, where he~~ was ~~Vice~~a ~~President~~key factor in ~~the~~crude’s ~~over-the-counter~~run. ~~fixed~~Overall ~~income~~demand ~~derivatives~~for ~~area.~~commodities ~~From~~as ~~1985~~an toasset ~~1989,~~class he was ~~employed by Manufacturers Hanover Trust Company~~supportive, ~~ultimately~~particularly ~~holding the position of Assistant Vice President~~ in the ~~Swaps and~~Peoples ~~Futures~~Republic ~~Group.~~of ~~Mr. Fell~~China ~~holds an A.B. cum laude in Music Theory~~ and ~~History and an M.B.A.~~ in ~~Finance from Columbia University~~India.

~~Ms. Melissa~~Reformulated ~~Cohn~~gasoline ~~(born~~soared ~~1960),~~throughout ~~Vice President and Senior Research Analyst, joined~~ the ~~Managing~~year ~~Owner in 1988. Her responsibilities include manager due diligence, manager analysis,~~ and ~~portfolio/risk~~topped ~~management.~~off ~~Ms. Cohn~~with ~~has been~~a ~~involved~~year-to-date ingain ~~the~~of ~~futures industry for~~ over 2045% ~~years.~~within ~~Prior to joining~~ the ~~Managing~~Dow ~~Owner,~~Jones ~~she~~AIG ~~spent~~Index. ~~six~~Heating ~~years~~oil inperformed ~~positions~~well ~~of increasing responsibility~~ in ~~the~~2007 ~~Commodities~~and ~~Division~~closed atup ~~Shearson Lehman Hutton Inc~~5.5% ~~Her~~within ~~experience~~the ~~includes~~same ~~that of~~index. ~~Sales~~Distillate ~~Assistant,~~inventories ~~Assistant~~remained ~~Commodity~~below ~~Trader~~the ~~and~~five-year ~~Trader~~average ~~executing~~and ~~orders~~Department ~~from~~of ~~numerous~~Energy ~~CTAs~~inventories ~~that~~ran ~~traded~~6% ~~through~~under ~~Shearson.~~last ~~Ms. Cohn~~year ~~graduated~~despite ~~from~~relatively ~~the~~moderate ~~University~~weather ~~of Wisconsin Madison with a B~~conditions.S. ~~in Agriculture in 1982.~~

~~Mr. James~~Agriculturals: ~~Dodd (born 1951)~~Clearly, ~~has~~2007 ~~been~~was a ~~principal,~~superior ~~associated~~year ~~person~~for ~~and~~commodities ~~NFA~~as ~~associate~~evidence ~~member~~by ofstronger ~~the~~readings ~~Managing~~in ~~Owner~~the ~~since~~major ~~February 26, 2002, February 26,~~indices. ~~2002~~The ~~and~~19-component ~~January 25,~~Dow ~~2002,~~Jones ~~respectively.~~AIG HeIndex iswitnessed ~~responsible~~a ~~for~~yearly ~~structuring~~gain ~~and~~of ~~marketing~~over ~~investment~~11%. ~~products~~Commodities attracted tosignificant ~~financial~~interest ~~institutions~~as ~~and~~an toalternative ~~retail~~asset ~~investors~~class ~~via~~throughout ~~the~~2007. ~~brokerage~~Corn ~~and~~closed ~~financial~~the ~~consultant~~year ~~channels. Earlier~~at inprices ~~his~~that ~~career,~~have ~~Mr. Dodd~~not ~~was~~been aseen ~~senior~~since ~~marketing~~the ~~officer~~summer of ~~the~~1996. ~~Capital~~One ~~Markets~~key ~~Group~~fundamental offactor ~~Continental~~contributing ~~Bank~~to incorn’s ~~Chicago;~~growth, ~~President~~besides ofthe ~~Signet~~evident ~~Investment~~global demand ~~Banking~~for ~~in Richmond~~ethanol, ~~Virginia;~~is ~~and~~the ~~Managing~~increased ~~Director~~quality of ~~Financial~~living ~~Institutions~~in ~~Marketing at~~developing ~~Chesapeake~~countries ~~Capital,~~such aas ~~large~~China ~~Richmond-based~~and ~~CTA~~India. ~~Mr. Dodd~~On ~~received~~the anproduction ABside, ~~degree~~perhaps ~~from~~with ~~Cornell~~the ~~University~~exception inof ~~1974~~soybeans, ~~and~~wherever acrop ~~M.B.A.~~interchangeability ~~degree~~allows, ~~from~~corn ~~the~~will ~~University~~continue ofto ~~Chicago~~steal inacres ~~1983~~from competing agricultural products.

~~Ms. Florence Y.~~Soybean ~~Sofer~~prices ~~(born~~finished ~~1966)~~the year over $12.50, ~~has~~which ~~been~~is asecond ~~principal~~to ofhistorical ~~the~~highs ~~Managing~~set ~~Owner~~in ~~since~~June ~~February 28,~~of ~~2002~~1973. ~~She~~The ~~has~~fundamentals for ~~been~~soybeans ~~Vice~~remain ~~President,~~demand ~~Investor~~driven. ~~Relations/~~China’s ~~Communications~~need offor ~~the~~beans, ~~Managing~~bean ~~Owner~~oil ~~since joining~~and ~~the~~bean ~~Managing~~meal ~~Owner~~is inso ~~November~~massive ~~2001.~~that ~~From~~all ~~1997~~importation totaxes ~~2001,~~and ~~Ms. Sofer~~tariffs ~~was~~on ~~the~~all ~~Vice~~three ~~President,~~have ~~Marketing~~been dropped, ~~and~~which is a ~~Principal~~rare ofmove. ~~JWH,~~On ~~where~~the ~~she~~supply ~~was~~side, ~~responsible~~the battle for ~~strategic~~global ~~marketing~~acreage ~~and~~will hinge ~~client~~on ~~communications for~~ the ~~firm~~relative ~~and~~value ~~its~~of ~~subsidiaries~~competing crops. ~~From~~ ~~1994~~In ~~to 1997~~2007, ~~Ms. Sofer~~the ~~was~~wheat ~~the~~market ~~Marketing~~realized ~~Manager~~an atoutstanding ~~Global~~87% ~~Asset~~increase ~~Management~~in ~~(“GAM”)~~prices ~~where~~from ~~she~~2006, ~~was~~setting ~~involved~~new inall time record prices. This gain is despite the ~~successful~~historic ~~development~~drought ~~and~~in ~~launch~~Australia, one of the ~~firm~~world’s largest ~~mutual~~producers ~~fund~~of ~~product~~the ~~line~~grain. ~~Ms. Sofer~~On ~~received~~the awhole, ~~B.A.~~cotton ~~degree from~~improved ~~American~~in ~~University~~2007 inending ~~1988~~the ~~and~~year with over a ~~M.B.A.~~22% inincrease, ~~Marketing~~at ~~from~~a ~~George~~level ~~Washington~~that ~~University~~has innot ~~1992~~been seen since early 2004.

~~Mr. David K.~~Indices: ~~Spohr~~The ~~(born~~major ~~1963), Vice~~US ~~President~~equity ~~and~~indices ~~Director~~slumped ofin ~~Fund Administration joined~~ the ~~Managing~~fourth ~~Owner~~quarter inunder ~~2005. He is responsible for~~ the ~~development~~weight ~~and execution~~ of the ~~administration~~subprime ~~group~~credit ~~support~~crisis ~~responsibilities.~~but ~~From~~still ~~2002~~tallied togains ~~2005,~~for Mrthe year. ~~Spohr~~ ~~was~~For ~~a Vice President at Safra Group~~2007, ~~where~~the heDow ~~was~~Jones ~~responsible~~rose ~~for~~over 6%, the ~~Alternative~~S&P ~~Investment~~500 ~~operations~~added 3.5%, ~~tax~~while ~~reporting~~the ~~and~~tech heavy ~~pricing~~NASDAQ ~~valuation.~~was ~~From~~the ~~2000~~leading toperformer ~~2002,~~with ~~he was~~ a ~~consultant~~10% togain. The ~~Safra~~fourth ~~Group.~~quarter ~~From 1994~~sell-~~1999,~~off he was ~~Manager~~a result of ~~Investment~~traders ~~Services~~becoming ~~for~~increasingly ~~the~~concerned ~~Bank~~about ~~of Bermuda,~~the ~~supporting~~economy ~~private~~in ~~client~~general ~~transactions.~~and ~~From~~housing ~~1993~~in toparticular. ~~1994,~~Some hedoubted ~~was~~ the ~~Manager~~Federal ofReserves ~~Global~~(“Fed”) resolve ~~Operations~~to ~~for~~address ~~Highbridge~~the ~~Capital~~economic ~~Corporation~~issues ~~during~~in the ~~fund’s~~face ~~infancy.~~of ~~Mr. Spohr~~growing ~~received~~inflation ~~a B~~concerns.S. inAlso, ~~Business~~interest ~~Economics~~and ~~from~~demand ~~The~~for ~~State University~~commodities ofas ~~New~~an ~~York~~alternative ~~College~~asset atclass ~~Oneonta~~weighed inon ~~1985~~the ~~and~~equity ~~designation as a Chartered Financial Analyst in 1998~~sector.

~~Section 16(~~To a) ~~Beneficial~~lesser ~~Ownership~~extent, ~~Reporting~~European ~~Compliance~~equities echoed the weak tone of the US during the fourth quarter. However, the German DAX showed strong gains of 22% during 2007. The CAC and FTSE scored much lower gains of 1% and 4%. The broad based Pan-European Dow Jones STOXX 600 suffered minor losses as markets outside of the big three struggled.

~~Certain~~Equities ofsoared the Managing Owner’s directors and officers and any persons holding more than ten percent of the Registrant’s Limited Interests (“Ten Percent Owners”) are required to report their initial ownership of such Limited Interests and any subsequent changes in ~~that~~Asia ~~ownership~~with to the ~~Securities~~ ~~and~~Hang ~~Exchange~~Seng ~~Commission~~Index, ~~(the~~Shanghai ~~“SEC”) on Forms 3~~Composite, 4Kospi orIndex ~~5. Such directors~~ and ~~officers~~Australian ~~and~~All ~~Ten~~Ordinaries ~~Percent~~setting ~~Owners~~record ~~are~~highs ~~required~~during by2007. ~~SEC~~During ~~regulations to furnish~~ the ~~Registrant~~fourth ~~with copies of all Forms 3~~quarter, 4volatility ~~and~~was 5rampant ~~they~~across ~~file~~Asian equities. ~~There~~While ~~are no Ten Percent Owners of~~ the ~~Registrant’s~~Hang ~~Limited~~Seng ~~Interests.~~performed ~~Each~~extremely ofwell, ~~Lawrence~~with S.almost ~~Block~~a ~~and~~40% gain ~~David K. Spohr failed to timely file an Initial Statement of Beneficial Ownership of Securities~~ on ~~Form 3 during~~ the ~~Registrant’s most recent fiscal~~ year~~. Other than as set forth above~~, ~~all~~it ~~filing~~was ~~requirements of Section 16(~~a) ofdifferent ~~the~~story ~~Exchange~~for ~~Act~~Japan ~~were~~as ~~timely complied with during~~ the ~~fiscal~~NIKKEI ~~year.~~lost Inover ~~making~~11%, ~~these~~resulting ~~disclosures,~~in the ~~Registrant~~first ~~has~~decline ~~relied~~in ~~solely~~the onpast ~~written~~five ~~representations~~years. ofDespite the ~~Managing Owner’s~~International ~~directors~~Monetary ~~and~~Fund ~~officers~~lowering ~~and the Registrant~~Japan’s ~~Ten~~growth ~~Percent~~rate ~~Owners~~in orNovember, ~~copies~~business ofinvestment remained ~~the~~expansionary ~~reports that they have filed with the SEC during~~ and ~~with~~many ~~respect~~market toparticipants ~~its~~view ~~most~~a ~~recent~~Japanese ~~fiscal~~recession ~~year~~as unlikely.

1615

~~The~~Interest ~~Registrant~~Rates: ~~itself~~With ~~does~~inflation ~~not~~concerns ~~have~~and ~~any~~the ~~employees.~~global ~~Preferred~~credit ~~Investment~~crisis ~~Solutions~~taking ~~Corp.~~center ~~acts~~stage asduring ~~Managing~~the ~~Owner~~second ofhalf of the ~~Registrant.~~year, ~~The~~the ~~Board~~Fed ofreacted ~~Directors~~aggressively ofon ~~Preferred~~September 18 ~~Investment~~and ~~Solutions~~cut ~~Corp.~~both ~~has~~the ~~delegated~~Fed ~~audit committee~~Funds ~~responsibilities~~rate toby ~~the~~50 ~~Internal~~basis ~~Controls~~points ~~and~~from ~~Disclosure Committee~~5.25% ~~Maureen~~to ~~Howley,~~4.75% asand the ~~Chief~~discount ~~Financial~~rate ~~Officer~~to of5.25%. ~~Preferred~~After ~~Investment~~this ~~Solutions~~action, ~~Corp.~~the ~~and~~yield ascurve ashowed ~~member~~significant ofsteepening. ~~the~~The ~~Internal~~2 ~~Controls~~ and ~~Disclosure~~10 ~~Committee,~~year benchmark ~~serves~~notes asended the ~~“audit~~ ~~committee~~year ~~financial~~lower ~~expert”~~than ~~for~~2006. ~~Preferred~~The ~~Investment~~Federal ~~Solutions~~Reserve ~~Corp.~~indicated ~~Ms. Howley~~possible isfuture ~~not~~US arate ~~member~~hikes ofin the ~~Board~~coming ofmonths. ~~Directors~~The ~~and~~TED ~~she~~spread iscontinued ~~not~~to ~~independent~~rise ofthrough ~~management~~November.

~~Code~~After a pair of ~~Ethics~~rate hikes in the first half of the year, the ECB held steady at 4.00% through year-end and the euro benefited from perceptions that the ECB seems to be in a holding pattern. The BOE issued three quarter-point rate increases in the first half of 2007. Forced to deal with the Northern Rock Crisis, declines in consumer confidence, housing declines and weakness in the service sector during the second half of the year, the BOE slashed their rate by a quarter-point in December to end the year at 5.50%.

~~Preferred~~The ~~Investment~~Bank ~~Solutions Corp. has adopted a code~~ of ~~ethics~~Japan ~~for~~(“BOJ”) ~~its~~raised ~~chief~~rates ~~executive officer,~~in ~~chief~~the ~~financial~~first ~~officer,~~quarter ~~director~~ of ~~fund~~the ~~administration,~~year ~~accounting managers~~ and ~~persons~~held the ~~performing~~rate ~~similar~~steady ~~functions.~~through Athe ~~copy~~end of the ~~code~~year. ofA ~~ethics~~rash ~~may~~of belackluster ~~obtained~~economic atdata noweighed ~~charge~~on byBOJ ~~written~~officials ~~request~~but tothey ~~Preferred~~kept ~~Investment~~the ~~Solutions~~rates ~~Corp~~unchanged.~~, 900~~ ~~King~~The ~~Street,~~Peoples ~~Suite~~Bank ~~100,~~of ~~Rye~~China ~~Brook,~~drained ~~New~~liquidity ~~York~~and ~~10573~~gradually orhiked byinterest ~~calling~~rates ~~(914) 307-7000~~throughout 2007.

Metals: Base metals had a rather difficult 2007. The dismal housing market, poor construction data in the US and UK and the sliding US dollar had a significant ~~Item 11~~impact. ~~Executive~~Zinc ~~Compensation~~was the worst performer among the nineteen components of the Dow Jones AIG Index, with annual losses over 43%. Aluminum and nickel witnessed steep losses over 18% and 16% within the Dow Jones AIG Index, respectively. In December, copper had a rough month but still posted an annual gain of over 4.5%.

~~The~~Precious ~~Registrant~~metals, ~~does~~on ~~not~~the ~~pay~~other ~~or accrue any fees~~hand, ~~salaries~~recorded ortremendous ~~any~~gains ~~other~~during ~~form~~2007. ofGold sky ~~compensation~~rocketed to ~~officers~~a ofnear ~~the~~twenty-eight ~~Managing~~year ~~Owner~~high ~~for~~and ~~their~~finished ~~services~~2007 up over 32%. ~~(See~~This ~~also~~trend ~~Item 13~~was fueled by the weak dollar, ~~Certain~~soaring ~~Relationships~~oil prices, subprime credit woes and ~~Related~~several ~~Transactions~~geopolitical events, ~~for~~including ~~information~~the ~~regarding~~recent ~~compensation~~developments in Pakistan. Gold saw spotty selling per the yen carry trade and other margin needs during the second half of the year. Silver traded with more volatility than gold and experienced less flight-to-safety demand and ended the ~~Managing~~year ~~Owner~~topping a 9% profit.) Platinum had a positive year as Asian demand for the metal held strong.

Softs and Livestock: Citrus finished up 2007 on the rally side following forecasts of ~~Item 12~~freezing temperatures in the sunshine state. ~~Security~~However, ~~Ownership~~this ofrally ~~Certain~~could ~~Beneficial~~not ~~Owners~~offset losses realized throughout the year. Sugar and ~~Management~~coffee had a rather difficult year as well. Within the Dow Jones AIG Index sugar and ~~Related~~coffee ~~Interest~~were ~~Holder~~down ~~Matters~~more than 14% and 6%, respectively. Following negative 2006 performance, cocoa rebounded in 2007, achieving a 17% return on the year.

As2007 ~~of March 10,~~proved ~~2006,~~less ~~Preferred~~than ~~maintains~~kind ato livestock 1%prices ~~Managing~~as ~~Owner~~both ~~Interest~~cattle inand ~~the~~hogs ~~Registrant~~suffered losses. AsLive ofcattle ~~March 10,~~were ~~2006,~~down ~~all~~more ofthan ~~Preferred~~6% ~~Investment~~within ~~Solutions~~the ~~Corp~~Dow Jones AIG Index. ~~stock~~Korea isrejected ~~owned~~a ~~indirectly~~series ~~and~~of ~~equally~~shipments byof ~~Messrs~~US beef on trepidation of mad-cow disease concerns. ~~Goodman~~Hogs ~~and~~were ~~Shewer,~~the ~~Preferred~~second ~~Investment~~worst ~~Solutions~~performer ~~Corp.’s~~within ~~sole~~the ~~directors~~Dow Jones AIG Index with a 30% loss.

AsThe ofYear ~~March~~Ended December 1031, 2006, ~~the following officers of the Managing Owner are deemed to own beneficially the following number of interests issued by the Registrant:~~

Title of Class	Name and Addresses of Beneficial Owner	Amount and Nature of Beneficial Ownership	Percent of Class
General interests	Marc S. Goodman 900 King Street, Suite 100 Rye Brook, New York 10573	604 General interests (*)	100%
General interests	Kenneth A. Shewer 900 King Street, Suite 100 Rye Brook, New York 10573	604 General interests (*)	100%
General interests	Esther E. Goodman 900 King Street, Suite 100 Rye Brook, New York 10573	604 General interests (**)	100%

The U.S. Federal Reserve (“Fed”) ceased raising rates in the fourth quarter. The perception remains that although the economy is slowing, there is no danger of a recession and that a soft landing is the most likely scenario. Range trading may be the dominant pattern for the next few months as prices react to the economic data. The yield on the benchmark U.S. 10-Year note finished November at an 11-month low. A weaker U.S. dollar failed to dampen enthusiasm for U.S. Treasuries. The latest data available shows capital flows to the U.S. rose in October.

~~(*)~~On ~~These~~the ~~interests~~employment ~~are~~front, job growth accelerated in December as non-farm payrolls rose while the unemployment rate held ~~indirectly~~steady ~~through~~at ~~Preferred~~4.5%. ~~The~~This ~~Beneficial~~is ~~Owner~~down ~~disclaims~~from ~~beneficial~~4.9% ~~ownership~~at ~~over~~the ~~such~~start ~~securities~~of ~~for~~2006. ~~purposes~~Of ofsome ~~Section~~concern 16was ofa ~~the~~0.5% ~~Securities~~jump ~~Exchange~~in ~~Act~~average ofhourly ~~1934~~earnings, taking ~~except~~them toup 4.2% over the ~~extent~~past of12 ~~his~~months. ~~pecuniary~~Overall, ~~interest~~the ~~therein~~employment picture persists as healthy but the construction, manufacturing and retail sectors all lost jobs in December.

Regarding U.S. inflation, the November Consumer Price Index (**“CPI”) ~~These~~was ~~interests~~unchanged ~~are~~and ~~held~~the byCore CPI, which factors out the ~~Beneficial~~more ~~Owner’s~~volatile ~~spouse~~food ~~indirectly~~and ~~through~~energy ~~Preferred~~prices, was also flat. ~~The~~This ~~Beneficial~~is ~~Owner~~the ~~disclaims~~lowest reading ~~beneficial~~for ~~ownership~~the ~~over~~core ~~such~~rate ~~securities~~since ~~for~~November ~~purposes~~2005. ofThere ~~Section~~were 16clearly ofno ~~the~~inflation ~~Securities~~worries ~~Exchange~~in ~~Act~~this ofdata. ~~1934~~The Producer Price Index (“PPI”) was not as controlled, ~~except~~climbing to2.0%, the ~~extent~~most ofsince ~~her~~1974. ~~pecuniary~~The ~~interest~~surge ~~therein~~was caused by a jump in energy, car and truck prices.

AsHousing ofhas ~~March~~been a major economic concern in 2006. 10November Housing Starts rose following a big drop in October. November Housing Permits, ~~2006~~however, no ~~owners~~fell ofslightly. ~~interests~~Over ~~beneficially~~the ~~own~~past ~~more~~11 ~~than~~months, ~~five~~Housing ~~percent~~Starts (were 12.5%~~) of~~ ~~the~~below ~~limited~~2005 ~~interests~~levels ~~issued~~while Housing Permits were off 14.1%. Homebuilders’ confidence, as indicated by the ~~Registrant.~~NAHB/Wells Fargo Index fell in December.

~~Item 13~~The overall consumer confidence picture remained mixed with the high end and electronics sectors doing well. ~~Certain~~November ~~Relationships~~Retail Sales rose 1.0%. The unusually warm weather hurt clothing and ~~Related~~Department ~~Transactions~~Store Sales. Third quarter Gross Domestic Product, a measure of economic growth, was revised downwards to the lowest level since the fourth quarter of 2005. Home building remains the main drag on growth.

~~The~~16 Registrant has and will continue to have certain relationships with the Managing Owner and its affiliates. However, there have been no direct financial transactions between the Registrant and the officers of the Managing Owner.

17While the Fed was on hold with respect to interest rate policy, the European Central Bank (“ECB”), the Bank of England (“BOE”) and the Peoples Bank of China (“PBC”) all raised interest rates. British housing prices and CPI growth continue to be high. Germany continues to exhibit growth, and leads the increasingly strong Eurozone. The Bank of Japan (“BOJ”) remained cautious, with no additional rate hikes following the July increase to 0.25%. The economy appears mixed, with consumer spending still less than the economy requires. The Bank of Canada, Reserve Bank of Australia and New Zealand central bank all remained on hold in December.

Currencies: The euro strengthened versus the U.S. ~~Item 14~~dollar in 2006, reversing the pattern from 2005. ~~Principal~~The ~~Accounting~~euro ~~Fees~~also strengthened against the Japanese yen, achieving record levels in December. Germany, the engine of Eurozone growth, has been the strongest European economy this year. Interest rate differential factors supported the euro through much of the fourth quarter of 2006. Of great significance, central banks around the globe have initiated a policy of diversification out of the U.S. dollar and ~~Services~~into the euro, the British pound, and to a lesser extent, the Japanese yen.

~~Audit~~The ~~Fees~~British pound ended the year slightly off its high, after rising approximately 14% versus the U.S. dollar. British housing prices have been surging and ~~All~~the ~~Other~~CPI ~~Fees~~came in above the BOE’s target.

The ~~principle~~Japanese ~~accountant~~yen ~~for~~fell against the ~~year~~U.S. ~~ended December 31~~dollar, ~~2005~~euro ~~was~~and ~~Deloitte &~~British ~~Touche~~pound during ~~LLP~~the fourth quarter of 2006. ~~The~~Japan ~~principle~~exited ~~accountant~~its ~~for~~deflationary era in 2006, although the ~~year~~fourth ~~ended~~quarter ~~December 31,~~saw ~~2004 was~~less ~~Arthur~~than F.robust ~~Bell,~~growth Jron the consumer side. & ~~Associates~~Other Asian currencies were better performers, Lwith the Korean won having a particularly solid December and fourth quarter.~~L.C.~~

~~Audit~~The ~~Fees~~Peoples Bank of China continues to tighten the reins on the economy. Most recently, the PBC increased the reserve requirement ratio for banks and raised the base interest rate 50 points to 6.72%. The yuan has shown an accumulative appreciation of about 3.7% since the July 2005 revaluation.

~~Fees~~Energies: ~~for~~Crude ~~audit~~oil ~~services~~was ~~totaled~~strong ~~approximately~~during ~~$51,000~~the ~~for~~first ~~2005~~half ~~($40~~of the year and weakened during the second half,~~000~~ towith ~~Deloitte &~~the ~~Touche~~exception ~~LLP~~of ~~and~~a brief respite during November. Crude ended December around $1160 per barrel,~~000~~ which contrasts to ~~Arthur~~its F.mid-July ~~Bell,~~peak Jrof nearly $78 per barrel. & ~~Associates,~~Record Lwarm weather in key consuming regions in the U.LS.~~C.)~~ ~~and~~put ~~$28,000~~pressure on the market during ~~2004,~~the ~~respectively~~quarter, ~~including~~ ~~fees~~as ~~associated~~did ~~with~~a ~~the~~generally ~~annual~~benign ~~audit~~geopolitical scene and ~~the~~poor ~~reviews~~member ofcompliance ~~the~~with ~~Registrant~~OPEC’s announced ~~quarterly~~production ~~reports on Form 10-Q~~cuts.

~~Tax~~The unusually warm weather kept heating oil under pressure during December. Heating oil will be dependent on a general recovery in commodity prices and a sudden weather shift in coming weeks. Department of Energy gasoline inventories are 0.5% below last season. The driving season was extended by the warm weather conditions.

~~Fees~~Natural ~~for~~gas ~~tax~~fell ~~services~~during bythe ~~Arthur~~fourth F.quarter ~~Bell,~~with ~~Jr. &~~the ~~Associates,~~weather Lweighing heavily on investor sentiment.~~L.C,~~ ~~including~~Inventories ~~tax~~are ~~compliance~~still burdensome and ~~tax~~demand ~~advice~~is ~~totaled~~slowing ~~approximately~~rather ~~$7,000~~than rising ~~and~~during ~~$6,500~~the innormally ~~2005~~strong ~~and 2004,~~seasonal ~~respectively~~demand time frame. What remains to be seen is whether the markets have discounted the majority of these bearish fundamentals.

WeGrains: ~~have~~While ~~been~~December’s ~~advised~~performance bywas ~~Deloitte &~~mixed, ~~Touche~~corn ~~LLP~~trended ~~that~~upwards ~~neither~~for the ~~firm,~~fourth ~~nor~~quarter ~~any~~as ~~member~~a whole. The last week of the ~~firm~~month, ~~has~~quarter, ~~any~~and ~~financial~~year ~~interest~~saw the posting of a multi-year high, with the final ~~direct~~price orfor ~~indirect~~2006 settling at the highest weekly close on the charts since the drought-driven summer rally in July of 1996. The main drivers behind the re-awakening of corn prices were threefold: 1) an increase in overseas demand due to improving global economic conditions; 2) the expansion of the production of ethanol; and 3) the ongoing increase in hedge fund and money managers’ investing in alternative non-correlated asset classes. For the quarter as a whole, despite a large trading range, the wheat market put in ~~any~~somewhat ~~capacity~~disappointing, albeit upward trending performance. The uncertainty caused by ongoing drought conditions in Australia, the ~~Registrant~~relatively orhigh ~~its~~price ~~affiliates~~for wheat and tight global stocks had an effect on supply and demand. The trend for soybean prices was higher for the fourth quarter of 2006. Export demand for soybeans, soybean oil and soybean meal all appear to be increasing. As corn production is increasingly diverted to the production of ethanol, substitute feedstuffs, with soybeans as the closest surrogate, may also feel the upward pull of prices. As the global supply of foreign cotton sold out late in the year, prices began to move higher from mid-November through the end of the year. The lethargy that characterized most of 2006 was a product of a massive carryover of last year’s crop, along with last summer’s unfortunate elimination of a marketing program which left U.S. cotton uncompetitively priced.

Indices: U.S. equities recorded their best gains in three years during the fourth quarter of 2006. The weakness in real estate that may have caused a shift into ~~PART~~equities, IVlarge levels of global liquidity, a drop in oil prices, a quiet geopolitical atmosphere, solid earnings and a brisk mergers and acquisitions calendar all added to the positive performance. A shift out of commodities also aided the tone of global equities. Blue chips, financials, oil and big caps did well, and at the end of the quarter technology names took a leading role.

			Page inAnnual Report
Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a)	1.	Financial Statements and Report of Independent Registered Public Accounting Firm incorporated by reference to the Registrant’s 2005 Annual Report which is filed as an exhibit hereto
		Report of Independent Registered Public Accounting Firm – Deloitte & Touche LLP	1
		Report of Independent Registered Public Accounting Firm – Arthur F. Bell, Jr. & Associates, L.L.C.	2
		Report of Independent Registered Public Accounting Firm – PricewaterhouseCoopers LLP	3
		Financial Statements:
		Statements of Financial Condition – December 31, 2005 and 2004	4
		Condensed Schedules of Investments – At December 31, 2005 and 2004	5
		Statements of Operations – Three years ended December 31, 2005	6
		Statements of Changes in Trust Capital – Three years ended December 31, 2005	7
		Notes to Financial Statements	8 –16
	2.	Financial Statement Schedules
		All schedules have been omitted because they are not applicable or the required information is included in the financial statements or the notes thereto
	3.	Exhibits
		Description:
	3.1	Amendment to Certificate of Trust dated October 1, 2004 (incorporated by reference to Exhibit 3.1 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2005)

It was also a very good December, fourth quarter and year for the European equity markets. Markets in Germany, the U.K. and France all ended higher for the fourth quarter. Heavy merger and acquisition activity was a major feature in Europe, along with a solid run of earnings and significant fund inflows. The strong U.S. market was also a psychological plus. The prospect of further rate hikes from the ECB, and to a lesser extent the BOE, failed to diminish enthusiasm.

18Asian/Pacific Rim equities also recorded solid 2006 gains, despite volatile trading. Record highs were achieved in Singapore, Australia and New Zealand during the final session of the year as well as for China’s Shanghai Composite. A growing Japanese economy served to buoy enthusiasm and a modest 0.25% base interest rate was supportive. Thailand’s SET Index had a very

		4.1		Third Amended and Restated Declaration of Trust and Trust Agreement of the Registrant dated as of October 1, 2004 (incorporated by reference to Exhibit 4.1 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2005).
		4.2		Subscription Agreement (incorporated by reference to Exhibit 4.2 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		4.3		Request for Redemption (incorporated by reference to Exhibit 4.3 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.1		Form of Escrow Agreement among the Registrant, Prudential Securities Futures Management Inc., Prudential Securities Incorporated and The Bank of New York (incorporated by reference to Exhibit 10.1 of the Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.2		Brokerage Agreement between the Registrant and Prudential Securities Incorporated (incorporated by reference to Exhibit 10.2 of the Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.3		Advisory Agreement, among the Registrant, Prudential Securities Futures Management Inc. and Willowbridge Associates Inc. (incorporated by reference to Exhibit 10.3 of the Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.4		Representation Agreement Concerning the Registration Statement and the Prospectus among the Registrant, Prudential Securities Futures Management Inc., Prudential Securities Incorporated, Wilmington Trust Company and Willowbridge Associates Inc. (incorporated by reference to Exhibit 10.4 of the Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.5		Net Worth Agreement between Prudential Securities Futures Management Inc. and Prudential Securities Group Inc. (incorporated by reference to Exhibit 10.5 of the Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.6		Secured Demand Note between Prudential Securities Group Inc. and Prudential Securities Futures Management Inc. (incorporated by reference to Exhibit 10.6 of the Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.7		Secured Demand Note Collateral Agreement between Prudential Securities Futures Management Inc. and Prudential Securities Group Inc. (incorporated by reference to Exhibit 10.7 of the Registrant’s Registration Statement on Form S-1, File No. 33-08443)
		10.8		Form of Foreign Currency Addendum to Brokerage Agreement between the Registrant and Prudential Securities Incorporated (incorporated by reference to Exhibit 10.8 of the Registrant’s Quarterly Report on Form 10-Q for the period ended March 31, 1996)
		10.9		Advisory Agreement dated August 25, 1998 among the Registrant, Prudential Securities Futures Management Inc. and Bridgewater Associates, Inc. (incorporated by reference to Exhibit 10.9 of the Registrant’s Quarterly Report on Form 10-Q for the period ended September 30, 1998)
		10.10		Form of Advisory Agreement dated June 30, 2000 among the Registrant, Prudential Securities Futures Management Inc. and Gamma Capital Management, LLC (incorporated by reference to Exhibit 10.10 of the Registrant’s Quarterly Report on Form 10-Q for the period ended June 30, 2000)
		10.11		Form of Advisory Agreement dated February 11, 2003 among the Registrant, Prudential Securities Futures Management, Inc. and Graham Capital Management, LP (incorporated by reference to Exhibit 10.11 of the Registrant’s Annual Report on Form 10-K for the period ended December 31, 2002.)
		10.12		Service Agreement among the Registrant, Prudential Securities Futures Management, Inc. and Wachovia Securities, LLC dated as of July 1, 2003 (Incorporated by reference to Exhibit 10.12 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2003).
		10.13		Novation letter among the Trust, the Trading Advisor and the Managing Owner dated September 14, 2004 (filed herewith)
		10.14		Letter Agreement amending and restating brokerage agreement between the Managing Owner and Prudential Financial Derivatives, LLC dated October 1, 2004 (filed herewith)

General and administrative

	13.1	Registrant’s 2005 Annual Report (with the exception of the information and data incorporated by reference in Items 5, 7 and 8 of this Annual Report on Form 10-K, no other information or data appearing in the Registrant’s 2005 Annual Report is to be deemed filed as part of this report) (filed herewith)
	31.1	Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)
	31.2	Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)
	31.3	Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)
	32.1	Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
	32.2	Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
	32.3	Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
(b)		Reports on Form 8-K – Change of Independent Registered Public Accounting Firm, dated October 18, 2005 (incorporated by reference)

volatile month after the central bank attempted to impose controls on capital for foreign investors in the stock market, but that was quickly reversed when the SET tumbled 15%, and prices subsequently recovered. However, Thailand has seen continuing political unrest.

20Interest Rates: As expected, the Fed remained on hold at its December 12 meeting. The minutes of the most recent Federal Open Market Committee (“FOMC”) meeting were virtually the same as the November meeting, indicating that the FOMC unanimously agreed that inflation persists as the primary concern to the economy. However, at the same time they stated the economy might have been a bit softer than previously thought.

In the international arena, the ECB increased rates 25 basis points in December and the BOE raised rates 25 basis points in November. The BOJ made just one move to 0.25% in 2006. Japanese consumer data has been a bit sluggish; something the ~~SIGNATURES~~BOJ will keep in focus. The Peoples Bank of China is currently engaged in a tightening process, and is actively draining liquidity by increasing reserve requirements.

~~Pursuant~~Metals: toA ~~the~~weak ~~requirements~~U.S. ofdollar ~~Section 13~~helped orsupport ~~15(d)~~gold for most of the ~~Securities~~quarter ~~Exchange~~but ~~Act~~during oflate ~~1934,~~December the ~~Registrant has~~dollar ~~duly~~showed ~~caused~~signs ~~this~~of ~~report~~a toconsolidation berally ~~signed~~and gold fell. Plunging energy prices had a negative impact on gold prices as well. Silver traded at its ~~behalf~~best bylevels in more than six months during the ~~undersigned~~quarter, ~~thereunto~~but ~~duly~~ended ~~authorized~~the year off its highs. For the year, onsilver significantly outperformed gold. Speculative participation was heavy throughout the ~~31st~~quarter, ~~day~~setting the stage for high volatility. A steady increase in inventories weighed on copper prices in the fourth quarter. A lessening of ~~March~~labor concerns, particularly in Chile and Canada, and the fact that China’s buying pace slowed in 2006 added to the negative tone. Zinc supplies remained tight and strong demand continued. Aluminum prices held up well in the fourth quarter in the face of a general commodity weakness. Nickel was one of the strongest performers in the metals group due to tight supply and a strong pattern of stainless steel demand.

FUTURES STRATEGIC TRUST
By:	Preferred Investment Solutions Corp.
	Managing Owner
	By:	/s/ Maureen D. Howley	Date: March 31, 2006
		Maureen D. Howley
		Chief Financial Officer and Senior Vice President

Softs: Forecasts for a significant global supply surplus of sugar weighed on sentiment, causing prices to decline 29% on the year. This made sugar the weakest agricultural commodity in the Dow Jones/AIG Index. Coffee prices remained relatively flat for 2006 and overall global coffee demand was solid. Scaled back cocoa crop prospects for the Ivory Coast, the world’s largest producer, added to the commodity’s recent bullish tone. The political situation in the Ivory Coast continues fairly quiet but civil unrest remains a potential factor. The cattle market traded sideways for most of the fourth quarter until severe weather conditions reduced cattle supply and caused prices to rise in the second half of December. Hog supply was ample during the quarter as the US entered a seasonally slow demand period. On the bright side, the most recent USDA estimate is that US pork exports will rise in 2007 to follow the 2006 increase.

~~Pursuant~~Sector ~~to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the~~Performance ~~following persons on behalf of the Registrant in the capacities indicated on March 31, 2006.~~

FUTURES STRATEGIC TRUST
By:	Preferred Investment Solutions Corp.
	Managing Owner
	By:	/s/ Kenneth A. Shewer	Date: March 31, 2006
		Kenneth A. Shewer Co-Chief Executive Officer (Principal Executive Officer)
	By:	/s/ Maureen D. Howley	Date: March 31, 2006
		Maureen D. Howley Chief Financial Officer and Senior Vice President (Principal Financial and Accounting Officer for the Trust)
	By:	/s/ David K. Spohr	Date: March 31, 2006
		David K. Spohr Vice President and Director of Fund Administration

Due to the nature of Registrant’s trading activities, a period-to-period comparison of its trading results is not meaningful. However, a discussion of Registrant’s trading results for the major sectors in which Registrant traded for the years ended December 31, 2008, December 31, 2007 and December 31, 2006 are presented below.

~~OTHER~~The ~~INFORMATION~~Year Ended December 31, 2008

~~The~~Currencies: ~~actual~~(+) Registrant ~~round-turn~~experienced ~~equivalent~~a majority of ~~brokerage~~its ~~commissions~~gains ~~paid~~in ~~per~~the ~~contract~~Swiss ~~for~~franc, Canadian dollar and British pound. The majority of losses were seen in the ~~year~~South ~~ended~~African ~~December 31,~~rand ~~2005~~and ~~was~~New $7Zealand dollar.~~94.~~

~~The~~Energies: ~~Trust’s~~(+) Registrant ~~Annual~~experienced ~~Report~~gains onin ~~Form~~reformulated ~~10-K~~gasoline, asheating ~~filed~~oil, ~~with~~brent ~~the~~crude, ~~Securities~~crude oil and ~~Exchange~~gas ~~Commission~~oil. isLosses ~~available~~were toincurred ~~Interest~~in ~~holders~~natural ~~without charge upon written request to:~~ gas.

~~Futures~~Grains: ~~Strategic~~(+) Registrant ~~Trust~~experienced gains in cotton, corn and soybeans. Losses were incurred in wheat.

~~c/o~~Indices: ~~Preferred Investment~~(+) Registrant ~~Solutions~~experienced ~~Corp~~a majority of its gains in the DJ Stoxx 50, S&P 500, DAX and the Nikkei. Losses were made in the NASDAX 100.

~~900~~Interest ~~King~~Rates: ~~Street~~(+) Registrant experienced a majority of its gains in US Treasury Notes, ~~Suite~~Eurodollar ~~100~~and the German Bund and BOBL. The majority of losses were incurred in Euroyen Tiffe and Canadian bonds.

~~Rye~~Meats: ~~Brook,~~(-) NYRegistrant ~~10573~~experienced gains in feeder cattle and live hogs. Losses were incurred in live cattle.

Metals: (+) Registrant experienced gains in gold, zinc and platinum. Losses were incurred in copper and aluminum.

Softs: (-) Registrant experienced gains in coffee and cocoa. Losses were incurred in sugar.

The Year Ended December 31, 2007

Currencies: (+) Registrant’s investment in this sector experienced a majority of its losses in Japanese yen, Mexican peso, South African rand and the Swiss franc. The majority of gains were experienced in the Australian dollar, Canadian dollar, euro and the euro versus the Japanese yen.

Energies: (+) Registrant’s investment in this sector experienced a majority of its gains in crude oil, gas oil, gasoline, heating oil and natural gas.

Grains: (+) Registrant’s investment in this sector experienced losses in corn and cotton. Gains were experienced in soybean oil, canola oil, wheat, soybean meal and soybeans.

Indices: (+) Registrant’s investment in this sector experienced a majority of its losses in the Australian All Ordinaries, FTSE 100 and the Nikkei indices. The majority of gains were experienced in the DAX, DJ Stoxx 50 and the S&P 500 indices.

Interest Rates: (+) Registrant’s investment in this sector experienced a majority of its losses in Australian Bonds and Australian Bank Bills. The majority of gains were experienced in Euribor, Eurodollars, British Gilt, Short Sterling, U.S. Treasury Bonds and U.S. Treasury Notes.

Meats: (+) Registrant’s investment in this sector experienced gains in feeder cattle, live cattle and live hogs.

Metals: (-) Registrant’s investment in this sector experienced losses in copper, aluminum, nickel and silver. Gains were experienced in gold, lead, zinc and platinum.

Softs: (-) Registrant’s investment in this sector experienced losses in cocoa, coffee and sugar.

The Year Ended December 31, 2006

Currencies: (-) Registrant’s revenue in the sector was down for the year. Long positions in the Canadian dollar and Japanese yen, short positions in the Euro, and long and short positions in the Swiss franc were the largest contributors to the losses for the year.

Energies: (-) Registrant’s revenue in the energy sector was down for the year, with a majority of the losses coming from long positions in crude oil and natural gas.

Grains: (-) Registrant’s revenue in the grain sector was down for the year, with a majority of the losses coming from long and short positions in wheat and corn.

Indices: (+) Registrant’s revenue in the sector was positive in 2006 primarily due to long positions in the DJ Stoxx 50, and long and short positions in the CAC 40 and IBEX indices.

Interest Rates: (+) Registrant’s revenue in the sector was up for the year, with a majority of the gains coming from short positions in the German Bund, London Gilt and U.S. Treasury Note.

Metals: (+) Registrant’s long positions in gold and zinc contributed to a gain in registrant’s revenue in the sector for 2006.

Softs: (-) Registrant’s revenue in the sector was down for the year, with losses from long and short positions in coffee and cocoa.

Results of Operations

The net asset value (“Net Asset Value”) per Interest as of December 31, 2008, was $123.31, an increase of 10.49% from the December 31, 2007 Net Asset Value per Interest of $111.60 which was an increase of 11.33% from the December 31, 2006 Net Asset Value per Interest of $100.24 which was an increase of 0.89% from the December 31, 2005 Net Asset Value per Interest of $99.36. The CISDM CPO Asset Weighted Index (formerly known as the Zurich Fund/Pool Qualified Universe Index) returned 16.29%, 8.55% and 8.30% for the years ended December 31, 2008, 2007 and 2006, respectively. The CISDM CPO Asset Weighted Index is the dollar weighted, total return of all commodity pools tracked by Managed Account Reports, LLC. Past performance is not necessary indicative of future results.

Registrant’s average net asset level during the year ended December 31, 2008 was approximately $4,071,000, a decrease of approximately $543,000 as compared to the year ended December 31, 2007 primarily due to redemptions. Registrant’s average net asset level during the year ended December 31, 2007 was approximately $4,614,000, a decrease of approximately $1,194,000 as compared to the year ended December 31, 2006 primarily due to redemptions. Registrant’s average net asset level during the year ended December 31, 2006 was approximately $5,808,000, a decrease of approximately $858,000 as compared to the year ended December 31, 2005 primarily due to redemptions.

Registrant’s trading gains before commissions were approximately $956,000, $957,000 and $344,000 during the years ended December 31, 2008, 2007 and 2006, respectively.

Interest income is earned on the average daily equity maintained with the clearing broker and bank at competitive interest rates and, therefore, varies monthly according to interest rates, trading performance and redemptions. Interest income during the year ended December 31, 2008 was approximately $49,000 a decrease of approximately $145,000 as compared to the year ended December 31, 2007 primarily due to lower average net asset levels discussed above and lower short term interest rates. Interest income during the year ended December 31, 2007 was approximately $194,000, a decrease of approximately $106,000 as compared to the year ended December 31, 2006 primarily due to a decrease in average net assets discussed above. Interest income during the year ended December 31, 2006 was approximately $300,000, an increase of approximately $115,000 as compared to the year ended December 31, 2005 primarily due to increasing short-term interest rates.

Commissions and administrative services are calculated on Registrant’s Net Asset Value on the first day of each month and, therefore, vary according to monthly trading performance and redemptions. Other transaction fees consist of NFA, exchange and clearing fees as well as floor brokerage costs and give-up charges, which are based on the number of trades the Trading Advisor executes, as well as which exchange, clearing firm or bank on, or through, which the contract is traded. Commissions, administrative services, and other transaction fees during the year ended December 31, 2008 were approximately $306,000, a decrease of approximately $44,000 as compared to the year ended December 31, 2007 primarily due a decrease in average net assets discussed above. Commissions, administrative services, and other transaction fees during the year ended December 31, 2007 were approximately $350,000, a decrease of approximately $88,000 as compared to the year ended December 31, 2006 primarily due to a decrease in average net assets discussed above. Commissions, administrative services, and other transaction fees during the year ended December 31, 2006 were approximately $438,000, a decrease of approximately $66,000 as compared to the year ended December 31, 2005 primarily due to a decrease in average net assets discussed above.

Management fees are calculated on Registrant’s share of the Trading Vehicle’s Net Asset Value at the end of each month, and therefore, are affected by monthly trading performance and redemptions. Management fees during the year ended December 31, 2008 were approximately $83,000, a decrease of approximately $24,000 as compared to the year ended December 31, 2007 primarily due to a decrease in average net assets discussed above. Management fees during the year ended December 31, 2007 were approximately $107,000, an increase of approximately $10,000 as compared to the year ended December 31, 2006 primarily due to changes in trading advisors. Management fees during the year ended December 31, 2006 were approximately $97,000, an increase of approximately $3,000 as compared to the year ended December 31, 2005 primarily due to Registrant’s terminating the managed accounts and investing in the Trading Vehicle, which incurred a higher Management Fee rate than the managed accounts.

Incentive fees are based on the “New High Net Trading Profits” (as defined in the applicable Advisory Agreement) generated by the Trading Advisor, are accrued monthly and are ultimately determined as of the close of business on the last business day of each calendar quarter. Incentive fees of approximately $169,000, $188,000 and $23,000 were incurred for the years ended December 31, 2008, 2007 and 2006, respectively.

General and administrative expenses net of any reimbursement from the Managing Owner during the years ended December 31, 2008, 2007 and 2006 were approximately $23,000, $22,000 and $1,000, respectively. These expenses include accounting, audit, tax, and legal fees allocated from the Trading Vehicle. Reimbursement received by the Registrant from the Managing Owner totaled approximately $8,000, $0 and $0 for the years ended December 31, 2008, 2007 and 2006, respectively. Reimbursement in 2008 represents the Registrant’s pro-rata allocation of the Spectrum Global Fund Administration administrative fee from the Trading Vehicle.

Inflation

Inflation has had no material impact on operations or on the financial condition of Registrant from inception through December 31, 2008.

Off-Balance Sheet Arrangements and Contractual Obligations

As of December 31, 2008, Registrant had not utilized special purpose entities to facilitate off-balance sheet financing arrangements and has no loan guarantee arrangements or off-balance sheet arrangements of any kind other than agreements entered into in the normal course of business, which may include indemnification provisions related to certain risks service providers, such as our accountants, undertake in performing services which are in the best interests of Registrant. While Registrant’s exposure under such indemnification provisions cannot be estimated, these general business indemnifications are not expected to have a material impact on Registrant’s financial position.

Registrant’s contractual obligations are with the Managing Owner and the Trading Vehicle and, as a result of its investment in the Trading Vehicle, with the Trading Advisor and the Trading Vehicle’s commodity broker. Management fees payable by Registrant to the Trading Advisor (through its investment in the Trading Vehicle) and to the Managing Owner are calculated as a fixed percentage of the Trading Vehicle and Registrant’s Net Asset Value, respectively. Incentive fees payable by the Registrant to the Trading Advisor (through its investment in the Trading Vehicle) are at a fixed rate, calculated as a percentage of the Trading Vehicle’s “New High Net Trading Profits”. As such, the Managing Owner cannot anticipate the amounts to be paid for future periods as Net Asset Values and “New High Net Trading Profits” are not known until a future date. Commissions payable to the Trading Vehicle’s commodity broker are based on a cost per executed trade and, as such, the Managing Owner cannot anticipate the amount that will be required under the brokerage agreement, as the level of executed trades are not known until a

future date. These agreements are effective for one-year terms, renewable automatically for additional one-year terms unless terminated. Additionally, these agreements may be terminated by either party thereto for various reasons. For a further discussion of Registrant’s contractual obligations, see Notes 1, 3 and 4 to Registrant’s financial statements for the year ended December 31, 2008, which is filed as an exhibit herewith.

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Information regarding quantitative and qualitative disclosures about market risk is not required pursuant to Item 305(e) of Regulation S-K.

Item 8.

Financial Statements and Supplementary Data

The financial statements are incorporated by reference to pages 3 through 5 of Registrant’s 2008 Annual Report, which is filed as an exhibit hereto.

Selected unaudited quarterly financial data for the years ended December 31, 2008 and 2007 are summarized below:


	First Quarter			Second Quarter		Third Quarter			Fourth Quarter
2008:
Total revenues (including interest)	$	567,645		$	277,057	$	(274,065	)	$	434,669

Total revenues (including interest) less commissions and other charges	$	485,568		$	196,610	$	(346,336	)	$	363,384

Net income (loss)	$	354,472		$	121,317	$	(368,843	)	$	317,184

Net income (loss) per weighted average interest	$	9.46		$	3.47	$	(11.37	)	$	9.84


	First Quarter			Second Quarter		Third Quarter			Fourth Quarter
2007:
Total revenues (including interest)	$	(14,736	)	$	686,123	$	221,126		$	258,298

Total revenues (including interest) less commissions and other charges	$	(111,515	)	$	596,271	$	138,063		$	177,878

Net income (loss)	$	(151,715	)	$	448,972	$	82,870		$	102,898

Net income (loss) per weighted average interest	$	(2.98	)	$	9.66	$	1.99		$	2.67

There were no extraordinary, unusual or infrequently occurring items recognized in any quarter reported above, and Registrant has not disposed of any segments of its business. There have been no year-end adjustments that are material to the results of any fiscal quarter reported above.

Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None

Item 9AT.

Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Registrant’s “disclosure controls and procedures” (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are designed to ensure that information required to be disclosed by Registrant in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “SEC”), and that such information is accumulated and communicated to Registrant’s management, including the Managing Owner’s Co-Chief Executive Officers and Director of Fund Administration (who, in these capacities, function as the Principal Executive Officers and Principal Financial Officer, respectively, of Registrant), as appropriate to allow for timely decisions regarding required disclosure.

In designing and evaluating Registrant’s disclosure controls and procedures, the Managing Owner recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. Because of the inherent limitations in all control systems, no evaluation of the controls can prove absolute assurance that all control issues and instances of fraud, if any, within Registrant have been detected.

The Managing Owner’s management, under the supervision and with the participation of certain officers of the Managing Owner (including the Managing Owner’s Co-Chief Executive Officers and Director of Fund Administration), has evaluated the effectiveness of Registrant’s disclosure controls and procedures as of December 31, 2008. Based upon such evaluation, the Managing Owner’s Co-Chief Executive Officers and Director of Fund Administration have concluded that, as of December 31, 2008, Registrant’s disclosure controls and procedures were effective.

Management’s Report on Internal Control Over Financial Reporting

Registrant’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision and with the participation of Registrant’s management, including the Managing Owner’s Co-Chief Executive Officers and Director of Fund Administration, Registrant conducted an evaluation of the effectiveness of its internal control over financial reporting as of December 31, 2008 based on the framework in “Internal Control—Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on the evaluation under the framework in “Internal Control—Integrated Framework” issued by COSO, the Managing Owner concluded that Registrant’s internal controls over financial reporting were effective as of December 31, 2008.

There are inherent limitations in the effectiveness of any internal control system, including the possibility of human error and the circumvention of overriding controls. Because of these inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Attestation Report of the Registered Public Accounting Firm

Registrant’s 2008 Annual Report does not include an attestation report of Registrant’s independent registered public accounting firm regarding the Registrant’s internal control over financial reporting. Management’s report was not subject to attestation by Registrant’s independent registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit Registrant to provide only management’s report in its 2008 Annual Report.

Changes in Internal Control Over Financial Reporting

There have been no changes in Registrant’s internal control over financial reporting (as defined in Rules 13a – 15(f) and 15d – 15(f) under the Exchange Act) during the fourth quarter of 2008 that have materially affected, or are reasonably likely to materially affect, Registrant’s internal control over financial reporting.

Item 9B.

Other Information

None

PART III

Item 10.

Directors, Executive Officers and Corporate Governance

Registrant had no directors or executive officers. Registrant is managed by the Managing Owner.

The directors and executive officers of the Managing Owner are as follows:

Mr. Kenneth A. Shewer (born 1953), a Director and Co-Chief Executive Officer of the Managing Owner, has been a principal, associated person and NFA associate member of the Managing Owner since February 8, 1984, May 1,1985 and August 1, 1985, respectively. He has been Chairman and Co-Chief Executive Officer of the Managing Owner since February 1984. Mr. Shewer was employed by Pasternak, Baum and Co., Inc. (“Pasternak, Baum”), an international cash commodity firm, from June 1976 until September 1983. Mr. Shewer created and managed Pasternak, Baum’s Grain Logistics and Administration Department and created its Domestic Corn and Soybean Trading Department. Mr. Shewer’s responsibilities at Pasternak, Baum included merchandising South American grain and exporting United States corn and soybeans. In 1982, Mr. Shewer became co-manager of Pasternak, Baum’s F.O.B. Corn Department. In 1983, Mr. Shewer was made Vice President and Director of

Pasternak, Baum. Mr. Shewer has traveled extensively in South America and Europe in connection with the commodity business and has organized and effected grain and oilseed sales in those regions, the former Soviet Union, and the Far East. While at Pasternak, Baum, Mr. Shewer was a member of the St. Louis Merchants Exchange and was associated with the National Grain and Feed Association and the North American Export Grain Association.

Mr. Shewer graduated from Syracuse University with a B.S. degree in 1975. Mr. Shewer sits on the Board of the Stacy Joy Goodman Memorial Foundation, a non-profit charity committed to finding a cure for Juvenile Diabetes. He is also a member of the Board of the Diabetes Research Institute Foundation, a not-for-profit organization affiliated with the University of Miami School of Medicine. Mr. Shewer is a founding member and a member of the Board of the Greenwich Roundtable. He is also a Director of The Kenmar Global ECO Foundation Inc., which was formed in order to make a meaningful, positive impact on society and the environment by identifying and supporting organizations that promote environmental and sustainability causes around the world.

Mr. Marc S. Goodman (born 1948), a Director and Co-Chief Executive Officer of the Managing Owner, has been a principal, associated person and NFA associate member of the Managing Owner since February 7, 1984, May 1, 1985 and August 1, 1985, respectively. He has been President and Co-Chief Executive Officer of the Managing Owner since February 1984. Mr. Goodman joined Pasternak, Baum in September 1974 and was a Vice President and Director from July 1981 until September 1983. While at Pasternak, Baum, Mr. Goodman was largely responsible for business development outside of the United States, for investment of its corporate retirement funds, and for selecting trading personnel in the Vegetable Oil Division. Mr. Goodman also created and developed Pasternak, Baum’s Lauric Oils Department. Mr. Goodman has conducted extensive business in South America, Europe and the Far East; he has been a merchandiser of all major vegetable oils and their by-products, and of various other commodities such as sunflower seeds, frozen poultry, pulses and potatoes.

Mr. Goodman graduated from the Bernard M. Baruch School of Business of the City University of New York with a B.B.A. in 1969 and an M.B.A. in 1971 in Finance and Investments, where he was awarded an Economics and Finance Department Fellowship from September 1969 through June 1971. Mr. Goodman is a member of the American Arbitration Association; while at Pasternak, Baum, he was a member of the National Institute of Oilseeds Products and the American Fats and Oils Association (including its Export Rules Committee).

Mr. Goodman is the Chairman of the Board of the Stacy Joy Goodman Memorial Foundation, a non-profit charity committed to finding a cure for Juvenile Diabetes. He is also the most recent past Chairman of the Board of the Diabetes Research Institute Foundation, a not-for-profit organization that is the principle source of funding for the Diabetes Research Institute, a world renowned cure based research center affiliated with the University of Miami School of Medicine. Mr. Goodman is a founding member and member of the Board of the Greenwich Roundtable. He is also a Director of The Kenmar Global ECO Foundation Inc., which was formed in order to make a meaningful, positive impact on society and the environment by identifying and supporting organizations that promote environmental and sustainability causes around the world.

Messrs. Shewer and Goodman left Pasternak, Baum in September 1983 to form Kenmar Advisory Corp. (now known as Preferred Investment Solutions Corp., the Managing Owner) and they have occupied their present positions with the Managing Owner since that time.

Ms. Esther Eckerling Goodman (born 1952), Senior Executive Vice President and Chief Operating Officer of the Managing Owner, has been a principal, associated person and NFA associate member of the Managing Owner since May 12, 1988, July 17, 1986 and July 17, 1986, respectively. She joined the Managing Owner in July 1986 and is its Chief Operating Officer and Senior Executive Vice President. Ms. Goodman has been involved in the futures industry since 1974. From 1974 through 1976, she was employed by Conti-Commodity Services, Inc. and ACLI Commodity Services, Inc., in the areas of hedging, speculative trading and tax arbitrage. In 1976, Ms. Goodman joined Loeb Rhoades & Company, Inc. where she was responsible for developing and managing a managed futures program that, in 1979, became the trading system for Westchester Commodity Management, an independent commodity-trading advisor of which Ms. Goodman was a founder and principal. From 1983 through mid-1986, Ms. Goodman was employed as a marketing executive at Commodities Corp. (USA) of Princeton, New Jersey. Ms. Goodman was a Director of the Managed Futures Trade Association from 1987 to 1991 and a Director of its successor organization, the Managed Futures Association, from 1991 to 1995 (now the Managed Funds Association). Ms. Goodman graduated from Stanford University with a B.A. degree in psychology in 1974.

Ms. Goodman is married to Mr. Marc Goodman.

Mr. Braxton Glasgow III (born 1953) has been a principal, associated person, branch manager and NFA associate member of the Managing Owner since June 21, 2001, June 21, 2001, July 13, 2004 and June 8, 2001, respectively. Mr. Glasgow has been an Executive Vice President of the Managing Owner since joining the Managing Owner in May 2001. Mr. Glasgow is responsible for business development. Previously, he served as Executive Vice President, Director of Client Services and a Principal at Chesapeake Capital Corp., a commodities trading firm, and as Senior Managing Director at Signet Investment Banking Co. Mr. Glasgow began his career at PricewaterhouseCoopers, where he specialized in mergers and acquisitions and private equity, including extensive work in Europe and the Far East. Mr. Glasgow received a B.S. in Accounting from the University of North Carolina at Chapel Hill and is a Certified Public Accountant. From 1994 to 1995, he was President of the Jay Group Ltd. Mr. Glasgow received a B.S. degree in accounting from the University of North Carolina in 1975.

Ms. Maureen D. Howley (born 1967) has been a principal of the Managing Owner since August 11, 2003. She has been a Senior Vice President and Chief Financial Officer of the Managing Owner since joining the Managing Owner in July 2003. She is responsible for corporate finance. From July 2001 until July 2003, Ms. Howley was an Associate at Andor Capital Management, LLC, an equity hedge fund company. At Andor, she was responsible for managing the corporate accounting functions. Previously, she was the Controller at John W. Henry & Company, Inc., a commodity-trading advisor (“JWH”), where she held positions of increasing responsibility from September 1996 to July 2001. She began her career at Deloitte & Touche where she specialized in the financial services industry. She held many positions of increasing responsibility for seven years, and left as an Audit Senior Manager in September 1996 to join JWH. Ms. Howley received a B.A. in Accounting from Muhlenberg College in 1989 and designation as a Certified Public Accountant in 1990.

Mr. Lawrence S. Block (born 1967) has been a Senior Vice President and General Counsel of the Managing Owner since joining the Managing Owner in March 2005. Prior to joining the Managing Owner, Mr. Block was a Managing Director and General Counsel of Lipper & Company, L.P., a New York-based investment management firm, from January 1998 until March 2005. Prior to joining Lipper & Company, Mr. Block was a senior associate at the law firm Cadwalader, Wickersham & Taft in New York from May 1996 through December 1997. Mr. Block also worked as an associate at the law firm Proskauer Rose Goetz & Mendelsohn from September 1992 through May 1996. Mr. Block received a B.S. in Business Administration with a concentration in Accounting from the University of North Carolina at Chapel Hill in 1989 and a J.D. from the University of Pennsylvania School of Law in 1992. Mr. Block’s registration as a principal of the Managing Owner has been effective since March 17, 2005.

Mr. David K. Spohr (born 1963), Senior Vice President and Director of Fund Administration of the Managing Owner, joined the Managing Owner in 2005. He is responsible for the development and execution of the administration group support responsibilities and, as Director of Fund Administration, functions as the Principal Financial/Accounting Officer of Registrant. From 2002 to 2005, Mr. Spohr was a Vice President at Safra Group, where he was responsible for the Alternative Investment operations, tax reporting and pricing valuation. From 2000 to 2002, he was a consultant to The Safra Group. From 1994-1999, he was Manager of Investment Services for the Bank of Bermuda, supporting private client transactions. From 1993 to 1994, he was the Manager of Global Operations for Highbridge Capital Corporation during the fund’s infancy. Mr. Spohr received a B.S. in Business Economics from The State University of New York College at Oneonta in 1985 and designation as a Chartered Financial Analyst in 1998.

Ms. Joanne D. Rosenthal (born 1965) has been a principal, associated person and NFA associate member of the Managing Owner since February 29, 2000, February 29, 2000 and November 30, 1999, respectively. Ms. Rosenthal is Senior Vice President and Director of Portfolio Management and Implementation for the Managing Owner. Prior to joining the Managing Owner in October 1999, Ms. Rosenthal spent nine years at The Chase Manhattan Bank, in various positions of increasing responsibility. From July 1991 through April 1994, she managed the Trade Execution Desk and from May 1994 through September 1999, she was a Vice President and Senior Portfolio Manager of Chase Alternative Asset Management, Inc. Ms. Rosenthal received a Masters of Business Administration with a concentration in Finance from Cornell University and a Bachelor of Arts in Economics from Concordia University in Montreal, Canada.

Mr. Peter J. Fell (born 1960), Senior Vice President and Director of Due Diligence since joining the Managing Owner in September 2004. He is responsible for manager selection and due diligence. Mr. Fell is a member of the Investment Committee. From 2000 through August 2004, Mr. Fell was a founding partner and Investment Director of Starview Capital Management. Prior to co-founding Starview Capital Management, Mr. Fell was Vice President of Research and Product Development at Merrill Lynch Investment Partners Inc (MLIP). He was responsible for the investment evaluation and recommendation process pertaining to MLIP funds and sat on MLIP’s Investment Committee. Prior to joining MLIP, Mr. Fell had been with Deutsche Bank Financial Products Corporation for six years starting in 1989, where he was Vice President in the over-the-counter fixed income derivatives area. From 1985 to 1989, he was employed by Manufacturers Hanover Trust Company, ultimately holding the position of Assistant Vice President in the Swaps and Futures Group. Mr. Fell holds an A.B. cum laude in Music Theory and History and an M.B.A. in Finance from Columbia University.

Mr. Bala Kasturi (born 1964), Senior Vice President and Director of Risk Management , joined the Managing Owner in March 2006. He is responsible for investment analytics and portfolio/risk management and collaborates on manager due diligence and analytics. Mr. Kasturi is a member of the Investment Committee. From January 2002 through January 2004, Mr. Kasturi served as a Managing Partner and Portfolio Manager at Vega Asset Management USA LLC and from January 2004 to July 2005, he served as Managing Partner and Portfolio Manager of the Taurus Global Macro Fund at VegaPlus Capital Partners USA LLC. Prior to joining VegaPlus, Mr. Kasturi was a macro fund manager at Bankers Trust/Deutsch Asset Management from January 2000 through December 2001 for the DB Global Macro Fund where he developed quantitative models for valuation and trading across all asset classes and strategies. From October 1997 through December 2000, he was Portfolio Manager at Bankers Trust for a global fixed income fund. Mr. Kasturi worked at Tiger Management from March 1993 through October 1997 as a Risk Manager, where he developed market risk systems and was a member of the Risk Management Committee. Mr. Kasturi has an undergraduate degree in Commerce from Osmania University in India, an MBA from Northeast Louisiana University and a MS in Computer Science from Ballarat University in Australia.

Ms. Melissa Cohn (born 1960), Managing Director and Senior Research Analyst, joined the Managing Owner in 1988. Her responsibilities include manager due diligence, manager analysis, and portfolio/risk management. Ms. Cohn has been involved in the futures industry for over 20 years. Prior to joining the Managing Owner, she spent six years in positions of increasing

responsibility in the Commodities Division at Shearson Lehman Hutton Inc. Her experience includes that of Sales Assistant, Assistant Commodity Trader and Trader executing orders from numerous CTAs that traded through Shearson. Ms. Cohn graduated from the University of Wisconsin Madison with a B.S. in Agriculture in 1982.

Mr. Gordon Nicholson (born 1965), Vice President and Senior Research Analyst, graduated from John Abbott College in 1985 with a Diploma of Collegiate Studies - Pure and Applied Sciences; from Bishop’s University in 1988 with a B.A. in Political Science and Economics and from Vermont Law School in 1993 with a J.D. Mr. Nicholson is also a Certified Financial Advisor and Chartered Alternative Investment Analyst. Mr. Nicholson joined the Kenmar Group in June 2005 and currently serves as Vice President, Director and Senior Research Analyst for the Managing Owner. Mr. Nicholson is a Member of Registrant’s Investment Committee. Previously, he was the Manager – Credit and Pricing, at Bombardier, Inc., a manufacturer of planes and trains, where he held positions of increasing responsibility from April 2003 to June 2005. Prior to that, from July 2002 to April 2003, he was a Senior Credit Analyst at Bombardier Capital, Inc., an asset management firm.

Ms. Jennifer S. Moros (born 1970) has been a Senior Vice President, Marketing and Investor Relations of the Managing Owner since joining the Managing Owner in January 2007. From October 2006 until December 2006, she worked at The Bank of New York. Previously, she was the Chief Operating Officer and Director of Marketing of Coronat Capital Management, LLC, a small start-up hedge fund, from November 2004 until September 2005. Previously, she was Vice President and Product Manager at Credit Suisse in their Alternative Capital Division from February 2000 until November 2004, responsible for marketing, new product development and reporting for their fund of hedge funds business. From June 1998 to January 2000, she was a Senior Associate in the Marketing and Business Development areas at Zweig-DiMenna, a large long/short equity hedge fund. Prior to this, she was employed at Symphony Alternative Investments, an alternatives pension consulting firm, from July 1997 to June 1998, where she was responsible for quantitative and qualitative assessments and recommendations of alternative investments including hedge funds, private equity and venture capital for large institutional clients. From November 1993 until July 1995, Ms. Moros was a Financial Analyst at Bankers Trust and a Business Applications Analyst at National Westminster Bancorp from August 1992 until November 1993. Ms. Moros received an M.B.A in Finance from The Sloan School at the Massachusetts Institute of Technology in 1997 and a B.S. in Economics from The Wharton School of the University of Pennsylvania in 1992.

Mr. Frank Coloccia (born 1965), Senior Vice President and Chief Technology Officer, graduated from Manhattan College in 1987 and 1993 with a BS in Computer Information Systems and MBA in Management Information Systems, respectively. Since December 2007, Mr. Coloccia has been Senior Vice President and Chief Technology Officer for all of the Kenmar Group of companies, including Preferred. Prior to joining Kenmar, Mr. Coloccia was a Managing Partner of JFA Group LLC, a consulting firm owned by Mr. Coloccia, from September 2007 until December 2007, as well as from September 2006 until January 2007. From January 2007 until September 2007, Mr. Coloccia was the Chief Research Officer at The Info Pro, an independent market research company for the Information Technology industry. Prior to that time, he was Senior Vice President of Xandros Inc., a provider of Linux-based server, desktop and Windows-Linux cross-platform systems management tools, from April 2006 until September 2006. From November 1999 through February 2006, Mr. Coloccia was the President and Chief Technology Officer of Creative Technologies Group Inc., a consulting company that specialized in networking and application support for the small-medium enterprises market.

Section 16(a) Beneficial Ownership Reporting Compliance

Certain of the Managing Owner’s directors and officers and any persons holding more than ten percent of Registrant’s Limited Interests (“Ten Percent Owners”) are required to report their initial ownership of Interests and any subsequent changes in that ownership to the Securities and Exchange Commission (the “SEC”) on Forms 3, 4 or 5. Such directors and officers and Ten Percent Owners are required by SEC regulations to furnish Registrant with copies of all Forms 3, 4 and 5 they file. There are no Ten Percent Owners of Registrant’s Limited Interests. All filing requirements of Section 16(a) of the Exchange Act were timely complied with during the fiscal year. In making these disclosures, Registrant has relied solely on written representations of the Managing Owner’s directors and officers and Registrant’s Ten Percent Owners or copies of the reports that they have filed with the SEC during and with respect to its most recent fiscal year.

Code of Ethics

Preferred has adopted a Code of Ethics for its Co-Chief Executive Officers and Director of Fund Administration (who, in these capacities, function as the Co-Chief Executive Officers and Principal Financial/Accounting Officer, respectively, of Registrant), accounting managers and persons performing similar functions. A copy of the Code of Ethics is attached as an exhibit hereto.

Audit Committee Financial Expert

Registrant itself does not have any employees. Preferred serves as Managing Owner of Registrant. The Board of Directors of Preferred has delegated audit committee responsibilities to the Internal Controls and Disclosure Committee. David K. Spohr is Preferred’s Director of Fund Administration (and, in that capacity, functions as Registrant’s Principal Financial/Accounting Officer), is a member of the Internal Controls and Disclosure Committee, and serves as the “audit committee financial expert” for Registrant. Mr. Spohr is not a member of Preferred’s Board of Directors and he is not independent of management.

Item 11.

Executive Compensation

Registrant does not pay or accrue any fees, salaries or any other form of compensation for officers of the Managing Owner for their services. (See also Item 13, Certain Relationships and Related Transactions, for information regarding compensation to the Managing Owner).

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

As of January 31, 2009, Preferred owns 325 General Units in Registrant. As of January 31, 2009, all of Preferred’s stock is owned indirectly and equally by Messrs. Goodman and Shewer, Preferred’s sole directors.

As of January 31, 2009, the following officers of the Managing Owner are deemed to own beneficially the following number of Interests issued by Registrant:


Title of Class	Name and Addresses of Beneficial Owner	Amount and Nature of Beneficial Ownership	Percent of Class
General Interests	Marc S. Goodman
	900 King Street, Suite 100
	Rye Brook, New York 10573	325 General Interests (*)	100	%

General Interests	Kenneth A. Shewer
	900 King Street, Suite 100
	Rye Brook, New York 10573	325 General Interests (*)	100	%

General Interests	Esther E. Goodman
	900 King Street, Suite 100
	Rye Brook, New York 10573	325 General Interests (**)	100	%

(*) These Interests are held indirectly through Preferred. The Beneficial Owner disclaims beneficial ownership over such securities for purposes of Section 16 of the Securities Exchange Act of 1934, except to the extent of his pecuniary interest therein.
(**) These Interests are held by the Beneficial Owner’s spouse indirectly through Preferred. The Beneficial Owner disclaims beneficial ownership over such securities for purposes of Section 16 of the Securities Exchange Act of 1934, except to the extent of her pecuniary interest therein.

As of January 31, 2009, no owners of Limited Interests beneficially owned more than five percent (5%) of the Limited Interests issued by Registrant.

Item 13.

Certain Relationships and Related Transactions, and Director Independence

Registrant has and will continue to have certain relationships with the Managing Owner and its affiliates. However, there have been no direct financial transactions between Registrant and the directors or officer of the Managing Owner.

Reference is made to Notes 1, 3 and 4 to the financial statements in Registrant’s 2008 Annual Report which is filed as an exhibit hereto, which identifies the related parties and discusses the services provided by these parties and the amounts paid or payable for their services.

Director Independence

David K. Spohr is Preferred’s Director of Fund Administration (and, in that capacity, functions as Registrant’s Principal Financial/Accounting Officer), is a member of the Internal Controls and Disclosure Committee, and serves as the “audit committee financial expert” for Registrant. Mr. Spohr is not a member of Preferred’s Board of Directors and he is not independent of management.

Item 14.

Principal Accounting Fees and Services

Audit Fees and All Other Fees

Registrant’s principal accountant has been Eisner LLP (“Eisner”). Registrant’s principal accountant for the year ended December 31, 2006 and for the period January 1, 2007 through September 14, 2007 was Deloitte & Touche LLP (“D&T”). We have been advised by Eisner that neither the firm, nor any member of the firm, has any financial interest, direct or indirect, in any capacity in Registrant or its affiliates.

(a) Audit Fees

Fees for audit services performed by Eisner totaled approximately $41,000 for 2008 including fees associated with the review of Registrant’s quarterly reports on Form 10-Q. Fees for audit services performed by Eisner totaled approximately $28,000 for 2007, respectively, including fees associated with the review of Registrant’s quarterly report on Form 10-Q. Fees for audit services performed by D&T totaled approximately $22,000 and $53,000 for 2007 and 2006, respectively, including fees associated with the annual audit and the reviews of Registrant’s quarterly reports on Form 10-Q.

(b) Audit-Related Fees

The audit-related fees billed to Registrant by Eisner for 2008 totaled $0. The audit-related fees billed to Registrant by Eisner for the period of October 15, 2007 through December 31, 2007 totaled $0. The audit-related fees billed to Registrant by D&T for the year ended December 31, 2006 and for the period January 1, 2007 through September 14, 2007 for products and services other than the services reported above totaled $0.

(c) Tax Fees

There were no fees for tax services performed by, or billed to the Registrant by Eisner for 2008 and 2007 or by D&T for 2007 and 2006.

(d) All Other Fees.

The other fees billed to Registrant by D&T for the year ended December 31, 2006 and for the period January 1, 2007 through September 14, 2007 for products and services other than the services reported above totaled $0. The other fees billed to Registrant by Eisner for the period of October 15, 2007 through December 31, 2007 totaled approximately $0. The other fees billed to Registrant by Eisner for 2008 totaled $0.

PART IV


		Annual Report Page Number
Item 15. Exhibits, Financial Statement Schedules

(a) 1.	Financial Statements and Report of Independent Registered Public Accounting Firm incorporated by reference to Registrant’s 2007 Annual Report which is filed as an exhibit hereto

	Report of Independent Registered Public Accounting Firm – Eisner LLP	1

	Report of Independent Registered Public Accounting Firm – Deloitte and Touche L.L.P.	2

	Financial Statements:

	Statements of Financial Condition – December 31, 2008 and 2007	3

	Statements of Operations – Three years ended December 31, 2008, 2007 and 2006	4

	Statements of Changes in Trust Capital – Three years ended December 31, 2008, 2007 and 2006	5

	Notes to Financial Statements	6 – 17

2.	Financial Statement Schedules

	All schedules have been omitted because they are not applicable or the required information is included in the financial statements or the notes thereto

3.	Exhibits

	Description:

3.1	Amendment to Certificate of Trust dated October 1, 2004 (incorporated by reference to Exhibit 3.1 of Registrant’s Annual Report on Form 10-K for the year ended December 31, 2005)


4.1		Fourth Amended and Restated Declaration of Trust and Trust Agreement of Registrant dated as of December 1, 2008 (filed herewith)

4.2		Subscription Agreement (incorporated by reference to Exhibit 4.2 of Registrant’s Registration Statement on Form S- 1, File No. 33-08443)

4.3		Request for Redemption (incorporated by reference to Exhibit 4.3 of Registrant’s Registration Statement on Form S- 1, File No. 33-08443)

4.4		The Privacy Notices of the Managing Owner dated January 2009 (filed herewith)

10.1		Form of Escrow Agreement among Registrant, Prudential Securities Futures Management Inc., Prudential Securities Incorporated and The Bank of New York (incorporated by reference to Exhibit 10.1 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)

10.2		Brokerage Agreement between Registrant and Prudential Securities Incorporated (incorporated by reference to Exhibit 10.2 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)

10.3		Advisory Agreement, among Registrant, Prudential Securities Futures Management Inc. and Willowbridge Associates Inc. (incorporated by reference to Exhibit 10.3 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)

10.4		Representation Agreement Concerning the Registration Statement and the Prospectus among Registrant, Prudential Securities Futures Management Inc., Prudential Securities Incorporated, Wilmington Trust Company and Willowbridge Associates Inc. (incorporated by reference to Exhibit 10.4 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)

10.5		Net Worth Agreement between Prudential Securities Futures Management Inc. and Prudential Securities Group Inc. (incorporated by reference to Exhibit 10.5 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)

10.6		Secured Demand Note between Prudential Securities Group Inc. and Prudential Securities Futures Management Inc. (incorporated by reference to Exhibit 10.6 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)

10.7		Secured Demand Note Collateral Agreement between Prudential Securities Futures Management Inc. and Prudential Securities Group Inc. (incorporated by reference to Exhibit 10.7 of Registrant’s Registration Statement on Form S-1, File No. 33-08443)

10.8		Form of Foreign Currency Addendum to Brokerage Agreement between Registrant and Prudential Securities Incorporated (incorporated by reference to Exhibit 10.8 of Registrant’s Quarterly Report on Form 10-Q for the period ended March 31, 1996)

10.9		Advisory Agreement dated August 25, 1998 among Registrant, Prudential Securities Futures Management Inc. and Bridgewater Associates, Inc. (incorporated by reference to Exhibit 10.9 of Registrant’s Quarterly Report on Form 10-Q for the period ended September 30, 1998)

10.10		Form of Advisory Agreement dated June 30, 2000 among Registrant, Prudential Securities Futures Management Inc. and Gamma Capital Management, LLC (incorporated by reference to Exhibit 10.10 of Registrant’s Quarterly Report on Form 10-Q for the period ended June 30, 2000)

10.11		Form of Advisory Agreement dated February 11, 2003 among Registrant, Prudential Securities Futures Management, Inc. and Graham Capital Management, LP (incorporated by reference to Exhibit 10.11 of Registrant’s Annual Report on Form 10-K for the period ended December 31, 2002.)

10.12		Service Agreement among Registrant, Prudential Securities Futures Management, Inc. and Wachovia Securities, LLC dated as of July 1, 2003 (Incorporated by reference to Exhibit 10.12 of Registrant’s Annual Report on Form 10-K for the year ended December 31, 2003).

10.13		Novation letter among Registrant, the Trading Advisor and the Managing Owner dated September 14, 2004 (incorporated by reference to Exhibit 10.7 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004)

10.14		Letter Agreement amending and restating brokerage agreement between the Managing Owner and Prudential Financial Derivatives, LLC dated October 1, 2004 (incorporated by reference to Exhibit 10.7 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004)


10.15		WMT Series H/J Trading Vehicle LLC Organization Agreement dated March 10, 2005 (incorporated by reference to Exhibit 10.15 of Registrant’s Annual Report on Form 10-K for the year ended December 31, 2006)

10.16		Amendment No. 1 to WMT Series H/J Trading Vehicle LLC Organization Agreement dated October 31, 2005 (incorporated by reference to Exhibit 10.16 of Registrant’s Annual Report on Form 10-K for the year ended December 31, 2006)

10.17		Advisory Agreement among WMT Series H/J Trading Vehicle LLC, Preferred Investment Solutions Corp. and Bridgewater Associates, Inc. dated November 30, 2005 (incorporated by reference to Exhibit 10.17 of Registrant’s Annual Report on Form 10-K for the year ended December 31, 2006)

10.18		Advisory Agreement among the Managing Owner, WCM Pool LLC and Winton Capital Management Limited dated November 20, 2006 (incorporated by reference to Exhibit 10.18 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007)

10.19		WCM Pool LLC Organization Agreement dated November 20, 2006 (incorporated by reference to Exhibit 10.19 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007)

10.20		Administrative Service Agreement between WCM Pool LLC and Preferred Investment Solutions Corp. dated November 20, 2006 (incorporated by reference to Exhibit 10.20 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007)

10.21		Amendment No. 1 to WCM Pool LLC Organization Agreement dated March 30, 2007 (incorporated by reference to Exhibit 10.16 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007)

10.22		Services Agreement between Spectrum Global Fund Administration, L.L.C. and Registrant dated May 23, 2007 (incorporated by reference to Exhibit 10.22 to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007)

10.23		Amendment No. 1 to Services Agreement between Spectrum Global Fund Administration, L.L.C. and Registrant dated January 1, 2009 (filed herewith)

13.1		Registrant’s 2008 Annual Report (with the exception of the information and data incorporated by reference in Items 5, 7 and 8 of this Annual Report on Form 10-K, no other information or data appearing in Registrant’s 2008 Annual Report is to be deemed filed as part of this report) (filed herewith)

14.1		Preferred Investment Solutions Corp. Code of Ethics (adopted pursuant to Section 406 of Sarbanes Oxley Act of 2002) as of October 13, 2008

31.1		Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)

31.2		Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)

32.1		Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

32.2		Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

(b)		Report on Form 8-K – Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year; Financial Statements and Exhibits, dated December 1, 2008 (incorporated by reference)

FUTURES STRATEGIC TRUST

ANNUAL REPORT

December 31, 2008

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Managing Owner and Limited Owners of

Futures Strategic Trust

We have audited the accompanying statements of financial condition of Futures Strategic Trust (the “Trust”) as of December 31, 2008 and 2007, and the related statements of operations and changes in trust capital and the financial highlights for the years ended December 31, 2008 and 2007. These financial statements and the financial highlights are the responsibility of the Trust’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Trust’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Futures Strategic Trust at December 31, 2008 and 2007, and the results of its operations and changes in its trust capital and financial highlights for the years ended December 31, 2008 and 2007, in conformity with accounting principles generally accepted in the United States of America.

EISNER LLP

New York, New York

March 25, 2009

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Managing Owner and Limited Owners of

Futures Strategic Trust

We have audited the statements of operations and changes in trust capital for the year ended December 31, 2006 of Futures Strategic Trust (the “Trust”). These financial statements are the responsibility of the Trust’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Trust’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the results of operations and changes in trust capital of Futures Strategic Trust for the year ended December 31, 2006 in conformity with accounting principles generally accepted in the United States of America.

Deloitte & Touche LLP

New York, New York

March 28, 2007

FUTURES STRATEGIC TRUST

STATEMENTS OF FINANCIAL CONDITION

December 31, 2008 and 2007


	2008		2007
ASSETS
Cash	$	36,041	$	41,133
Redemptions receivable from WCM Pool LLC		7,575		124,411
Investment in WCM Pool LLC, at fair value (99.38% and 99.51% of net asset value, respectively)		3,929,018		4,196,579
Receivable from Managing Owner		553		0

Total assets	$	3,973,187	$	4,362,123

LIABILITIES
Redemptions payable	$	7,575	$	122,478
Accounts payable		12,200		22,482

Total liabilities		19,775		144,960

TRUST CAPITAL (Net Asset Value)
Limited Interests (31,734.859 and 37,403.770 Interests outstanding) at December 31, 2008 and 2007, respectively		3,913,335		4,174,087
General Interests (325 and 386 Interests outstanding) at December 31, 2008 and 2007, respectively		40,077		43,076

Total trust capital (Net Asset Value)		3,953,412		4,217,163

Total liabilities and trust capital	$	3,973,187	$	4,362,123


Net Asset Value per Limited and General Interest
December 31,
2008		2007		2006
$	123.31	$	111.60	$	100.24

See accompanying notes.

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FUTURES STRATEGIC TRUST

STATEMENTS OF OPERATIONS

For the Years Ended December 31, 2008, 2007 and 2006


	2008			2007			2006
NET INCOME (LOSS) FROM TRUST OPERATIONS:
REVENUES
Realized	$	0		$	0		$	513,334
Change in net unrealized loss on open commodity transactions		0			0			(116,532	)
Interest income		213			2,412			262,815


Total revenues		213			2,412			659,617

EXPENSES
Administrative services		299,718			335,522			434,382
Management fees		0			0			70,389
Incentive fees		0			0			22,720
General and administrative		2,227			423			0


Total expenses		301,945			335,945			527,491


WCM Pool LLC administrative expenses borne by the Managing Owner and its affiliates		(8,149	)		0			0


Net expenses		293,796			335,945			527,491


NET INCOME (LOSS) FROM TRUST OPERATIONS		(293,583	)		(333,533	)		132,126


NET LOSS ALLOCATED FROM WMT III SERIES H/J TRADING VEHICLE LLC:
REVENUES
Realized		0			19,828			(248,303	)
Change in unrealized		0			(92,871	)		195,788
Interest income		0			58,102			37,259


Total revenues (losses)		0			(14,941	)		(15,256	)


EXPENSES
General and administrative		0			2,136			1,338
Broker commissions		0			4,924			3,289
Management fees		0			38,064			26,574


Total expenses		0			45,124			31,201


NET LOSS ALLOCATED FROM WMT III SERIES H/J TRADING VEHICLE LLC		0			(60,065	)		(46,457	)


NET INCOME ALLOCATED FROM WCM POOL LLC:
REVENUES
Realized		992,095			1,012,174			0
Change in unrealized		(36,149	)		17,674			0
Interest income		49,147			133,492			0


Total revenues		1,005,093			1,163,340			0

EXPENSES
Brokerage commissions and transaction fees		6,362			9,668			0
Management fees		83,206			69,300			0
Incentive fee		169,033			188,187			0
General and administrative		28,779			19,562			0


Total expenses		287,380			286,717			0


NET INCOME ALLOCATED FROM WCM POOL LLC		717,713			876,623			0


NET INCOME	$	424,130		$	483,025		$	85,669


NET INCOME PER WEIGHTED AVERAGE LIMITED AND GENERAL INTEREST
Net income per weighted average limited and general interest	$	12.36		$	10.87		$	1.53


Weighted average number of limited and general interests outstanding		34,306			44,446			55,886

See accompanying notes.

-4-

FUTURES STRATEGIC TRUST

STATEMENTS OF CHANGES IN TRUST CAPITAL

For the Years Ended December 31, 2008, 2007 and 2006


	Interests		Limited Interests			General Interests			Total
Trust capital at December 31, 2005	59,593.743		$	5,861,321		$	60,014		$	5,921,335

Redemptions	(7,535.922	)		(780,804	)		(7,920	)		(788,724	)

Net income for the year ended December 31, 2006				84,836			833			85,669


Trust capital at December 31, 2006	52,057.821			5,165,353			52,927			5,218,280

Redemptions	(14,268.051	)		(1,468,995	)		(15,147	)		(1,484,142	)

Net income for the year ended December 31, 2007				477,729			5,296			483,025


Trust capital at December 31, 2007	37,789.770			4,174,087			43,076			4,217,163

Redemptions	(5,729.911	)		(680,350	)		(7,531	)		(687,881	)

Net income for the year ended December 31, 2008				419,598			4,532			424,130


Trust capital at December 31, 2008	32,059.859		$	3,913,335		$	40,077		$	3,953,412

See accompanying notes.

-5-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS

December 31, 2008

Note 1. ORGANIZATION

General Description of the Trust

Futures Strategic Trust (the “Trust”) was organized under the Delaware Statutory Trust Act on October 16, 1995 and commenced trading operations on May 1, 1996. The Trust will terminate on December 31, 2020 unless terminated sooner as provided in the Fourth Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”). The Trust was formed to engage in the speculative trading of commodity futures, forward and options contracts. The Trustee of the Trust is Wilmington Trust Company.

The term (“Managing Owner”), as used herein, refers to, Preferred Investment Solutions Corp. (“Preferred”).

Effective November 1, 2006, the Trust allocated its net assets to WMT III Series H/J Trading Vehicle LLC, (the “Trading Vehicle”) and received a Voting Membership Interest in the Trading Vehicle. The Trading Vehicle was formed to function as an aggregate trading vehicle. The sole members of the Trading Vehicle were WMT III Series H, WMT III Series J and the Trust. The Trading Vehicle engaged in the speculative trading of futures contracts, options on futures contracts and forward currency contracts. Effective April 30, 2007, the Trading Vehicle liquidated and terminated the Trading Advisor agreement with Bridgewater Associates Inc. (“Bridgewater”), the trading advisor of the Trading Vehicle. Prior to the Trading Vehicle’s liquidation, the Trust became a member of WCM Pool LLC (the “Company”) on April 1, 2007. Subject to its agreement with the Company, the Trust transferred its assets from the Trading Vehicle to the Company, effective April 1, 2007, and received a Voting Membership Interest in the Company. The Company was formed to function as an aggregate trading vehicle. At December 31, 2008, the sole members of the Company are the Trust, Diversified Futures Trust I (“DFT I”) and Kenmar Global Trust (“KGT”). Preferred is the Managing Owner of DFT I and KGT and has been delegated administrative authority over the operations of the Company. The Company engages in the speculative trading of futures contracts. The financial statements of the Company and the Trading Vehicle, including the condensed schedule of investments, are included in Sections II and III, respectively of these financial statements and should be read in conjunction with the Trust’s financial statements.

Regulation

As a registrant with the Securities and Exchange Commission, the Trust is subject to the regulatory requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934. As a commodity pool, the Trust is subject to the regulations of the Commodity Futures Trading Commission (“CFTC”), an agency of the United States (U.S.) government which regulates most aspects of the commodity futures industry; rules of the National Futures Association (“NFA”), an industry self-regulatory organization; and the requirements of the various commodity exchanges where the Trust executes transactions. Additionally, the Trust is subject to the requirements of the futures commission merchants (brokers) and interbank market makers through which the Trading Vehicle and the Company (collectively, the “Companies”) had traded and presently trade, respectively.

-6-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 1. ORGANIZATION (CONTINUED)

The Offering

On May 1, 1996, the Trust completed its initial offering with gross proceeds of $12,686,200 from the sale of 125,352 Limited Interests and 1,510 General Interests. General Interests were sold exclusively to the Managing Owner. Additional interests were offered and sold monthly at the then current net asset value per Interest until the continuous offering period expired on January 31, 1998. Additional contributions raised during the continuous offering period resulted in additional proceeds to the Trust of $51,242,700.

The Managing Owner of the Trust is Preferred Investment Solutions Corp., which conducts and manages the business of the Fund. Effective December 1, 2008, the Fourth Amended and Restated Declaration of Trust and Trust Agreement no longer requires the Managing Owner to maintain a capital account equal to 1% of the total capital accounts of the Trust or a net worth of at least $1,000,000.

The Trading Managers

Through October 31, 2006, the monthly management fees were paid on traded assets and the quarterly incentive fees were paid on “New High Net Trading Profits” (as defined in each advisory agreement among the Trust, Managing Owner and each trading adviser) to each of the Trust’s trading advisors, Bridgewater and Graham Capital Management, LP (“Graham”), were as follows:


Trading Manager	Accrued Management Fee	Quarterly Incentive Fee
Bridgewater	.9756% annually of traded assets	20% of New High Net Trading Profits
Graham	2% annually of traded assets	20% of New High Net Trading Profits

The advisory agreements could be terminated for a variety of reasons, including at the discretion of the Managing Owner. On October 31, 2006, Preferred as Managing Owner terminated the trading advisory agreements with Bridgewater and Graham for the Trust’s managed accounts. Effective November 1, 2006, the assets of the Trust were reallocated to the Trading Vehicle, which was managed by Bridgewater. Through its investment in the Trading Vehicle, the Trust paid its pro-rata share of the 3% annual management fee (accrued and paid monthly) and a 20% incentive fee on Net New Profits, accrued monthly and paid quarterly, as defined in the trading advisory agreement.

On April 1, 2007, the Trust transferred its assets from the Trading Vehicle to the Company. Through its investment in the Company, the Trust pays its pro-rata share of the 2% annual management fee (accrued and paid monthly) and a 20% incentive fee of “New High Net Trading Profits”, accrued monthly and paid quarterly, as defined in the trading advisory agreement.

-7-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The financial statements of the Trust are prepared in accordance with accounting principles generally accepted in the United States of America. Such principles require the Managing Owner to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Commodity futures and forward transactions are reflected in the accompanying statements of financial condition on trade date. Net unrealized gain or loss on open contracts (the difference between contract trade price and market price) is reflected in the statement of financial condition in accordance with Financial Accounting Standards Board (“FASB”) Interpretation No. 39 – “Offsetting of Amounts Related to Certain Contracts.” The market value of futures (exchange-traded) contracts is based upon the closing quotation on the various futures exchanges on which the contract is traded. The values which will be used by the Trust for open forward and option positions will be provided by its administrator, who obtains market quotes from data vendors and third parties. Any change in net unrealized gain or loss during the current period is reported in the statement of operations. Realized gains and losses on commodity transactions are recognized in the period in which the contracts are closed. Brokerage commissions include other trading fees, and are charged to expense when incurred. Additionally, the Trust indirectly earned income or loss through investments in the Companies (see Note 2).

The weighted average number of Limited and General Interests outstanding was computed for purposes of disclosing net income per weighted average Limited and General Interest. The weighted average Limited and General Interests are equal to the number of Interests outstanding at year end, adjusted proportionately for Interests redeemed based on their respective time outstanding during such year.

The Trust has elected not to provide a Statement of Cash Flows as permitted by Statement of Financial Accounting Standards (“SFAS”) No. 102, “Statement of Cash Flows – Exemption of Certain Enterprises and Classification of Cash Flows from Certain Securities Acquired for Resale.”

Consistent with standard business practices in the normal course of business, the Trust has provided general indemnifications to the Managing Owner, its Trading Advisor and others when they act, in good faith, in the best interests of the Trust. The Trust is unable to develop an estimate of the maximum potential amount of future payments that could potentially result from any hypothetical future claim, but expects the risk of having to make any payments under these general business indemnifications to be remote.

-8-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

In July 2006, FASB issued FASB Interpretation (“FIN”): No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement No. 109” (“FIN 48”), which clarifies the accounting for uncertainty in tax positions. FIN 48 requires that the Trust recognize in its financial statements the impact of a tax position, if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The provisions of FIN 48 are effective for fiscal years beginning after December 15, 2006, with the cumulative effect of the change in accounting principle recorded as an adjustment to opening retained earnings. In connection with the adoption of FIN 48, the Trust has elected an accounting policy to classify interest and penalties related to unrecognized tax benefits as interest or other expense. All tax years which are statutorily open are subject to examination by the appropriate taxing authorities. Preferred, as Managing Owner of the Trust, evaluated the impact of adopting FIN 48 on the Trust’s financial statements. The adoption of FIN 48 had no material impact on the Trust, as the Trust’s tax positions are based on established tax precedence for the tax treatment of investment partnerships as flow through tax entities.

In September 2006, the FASB issued SFAS No. 157 (“SFAS 157”), “Fair Value Measurements”. SFAS 157 requires use of a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels: quoted market prices in active markets for identical assets and liabilities (Level 1), inputs other than quoted market prices that are observable for the asset or liability, either directly or indirectly (Level 2), and unobservable inputs for the asset or liability (Level 3). SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007.

The Trust adopted SFAS 157 in the first quarter of 2008. The adoption of SFAS 157 had no impact to the items required to be carried at fair value (investments) in these financial statements.

The following table summarizes the assets and liabilities measured at fair value using the fair value hierarchy of SFAS 157:


December 31, 2008	Level 1		Level 2		Level 3			Total
Assets:
Investment in WCM Pool LLC, at fair value	$	0	$	3,929,018	$	0		$	3,929,018

Transfers in (out)	$	0	$	3,929,018	$	(3,929,018	)	$	0

December 31, 2007	Level 1		Level 2		Level 3			Total
Assets:
Investment in WCM Pool LLC, at fair value	$	0	$	0	$	4,196,579		$	4,196,579

-9-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

Investments classified as Level 2 and Level 3 under SFAS 157 represent the Trust’s investment in the Company and are valued monthly at the net asset value as reported by the Company. The Company’s net asset value is determined based upon its management’s best estimate of the fair value of its underlying net assets, substantially all of which are investments valued using Level 1 inputs but include certain assets and liabilities where the inputs into the determination of fair value require management judgment or estimation. Preferred determined that certain of the Company’s assets and liabilities which require management judgment or estimation were not material to the Trust’s financial statements and therefore, the Trust’s investment in the Company should be classified as Level 2 at December 31, 2008. A table presenting the changes in the Level 2 and Level 3 fair value category for the years ended December 31, 2008 and 2007 is included in Note 5 of these financial statements. Of the $717,713 and $816,558 of gains for the years ended, December 31, 2008 and 2007, respectively, reported on Level 2 and Level 3 investments in Note 5, $(36,149) and $17,674, respectively, represent a change in unrealized gain (loss) allocated from the Company on the Trust’s statements of operations.

In October 2008, the FASB issued FASB Staff Position FAS 157-3, “Determining the Fair Value of a Financial Asset When the Market for That Asset Is Not Active” (“FSP FAS 157-3”). FSP FAS 157-3 clarified the application of SFAS 157. FSP FAS 157-3 demonstrated how the fair value of a financial asset is determined when the market for that financial asset is inactive. FSP FAS 157-3 was effective upon issuance, including prior periods for which financial statements had not been issued. Preferred, as Managing Owner of the Trust, evaluated the impact of adopting FSP FAS 157-3 and its impact on the Trust’s financial statements. The adoption of this standard did not have an impact on the Trust’s financial statements.

In February 2007, the FASB issued SFAS No. 159 (“SFAS 159”), “The Fair Value Option for Financial Assets and Financial Liabilities”, including an amendment of SFAS 115. This statement provides companies with an option to report selected financial assets and liabilities at fair value. This statement is effective for fiscal years beginning after November 15, 2007 with early adoption permitted. Preferred, as Managing Owner of the Trust, evaluated the impact of adopting SFAS 159 and its impact on Trust’s financial statements.

The Trust adopted SFAS 159 during the first quarter of 2008, and it did not have a material effect on the Trust’s financial statements, as the Trust did not elect the fair value option for any eligible financial assets or liabilities.

In April 2007, the FASB released FASB Staff Position FIN No. 39-1 “Offsetting of Amounts Related to Certain Contracts” (“FSP FIN 39-1”). FSP FIN 39-1 requires that offsetting of assets and liabilities in the balance sheet is improper except where a right of setoff exists. The application of FSP FIN 39-1 is required for fiscal years beginning after November 15, 2007 and interim period within those fiscal years. Preferred, as Managing Owner of the Trust, evaluated the impact of adopting FSP FIN 39-1 and its impact on the Trust’s financial statements. The adoption of this standard did not have an impact on the Trust’s financial statements.

-10-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

In March 2008, FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities – an amendment of FASB Statement No. 133” (“SFAS 161”). SFAS 161 establishes, among other things, the disclosure requirements for derivative instruments and for hedging activities. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. Preferred, as Managing Owner of the Trust, evaluated the implication of SFAS 161 and its impact on the Trust’s financial statements. The implementation of this standard is not expected to have an impact on the Trust’s financial statements.

Cash

Cash represents amounts deposited with a bank. The Trust receives interest on all cash balances held by the bank at prevailing rates as well as its pro rata share of interest income from the Companies since November 1, 2006.

Income Taxes

The Trust is treated as a partnership for Federal income tax purposes. As such, the Trust is not required to provide for, or pay, any Federal or state income taxes. Income tax attributes that arise from its operations are passed directly to the individual interest holders. The Trust may be subject to other state and local taxes in jurisdictions in which it operates.

Investments in the Companies

The investments in the Company and the Trading Vehicle are reported in the Trust’s statements of financial condition at the net asset value as reported by such entities. The Trust records its proportionate share of such entities’ income or loss in the statements of operations. Valuation of futures and forward contracts is discussed in the notes to the Company’s and the Trading Vehicle’s financial statements included in Sections II and III, respectively of this report. Through its investments in the Company and the Trading Vehicle, the Trust pays or paid its pro-rata share of the 2% and 3%, respectively, annual management fee (accrued and paid monthly) and a 20% incentive fee on “New High Net Trading Profits” (accrued monthly and paid quarterly) as defined in the advisory agreements.

Profit and Loss Allocation, Distributions and Redemptions

The Trust allocates profits and losses for both financial and tax-reporting purposes to its Interest holders monthly on a pro rata basis based on each owner’s Interests outstanding during the month. Distributions (other than redemptions of Interests) may be made at the sole discretion of the Managing Owner on a pro rata basis in accordance with the respective capital balances of the Interest holders. The Managing Owner has not made any distributions since inception and does not presently intend to make any distributions in the future.

-11-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Profit and Loss Allocation, Distributions and Redemptions (Continued)

Redemptions are permitted as of the last day of each month, on at least 10 days prior written notice. Redemptions are at the then current net asset value per Interest. Partial redemptions are permitted.

Foreign Currency Transactions

The Trust’s functional currency is the U.S. dollar; however, it transacts business in currencies other than the U.S. dollar. Assets and liabilities denominated in currencies other than the U.S. dollar are translated into U.S. dollars at the rates in effect at the date of the statement of financial condition. Income and expense items denominated in currencies other than U.S. dollars are translated into U.S. dollars at the rates in effect during the period. Gains and losses resulting from the translation to U.S. dollars are reported in operations currently under the caption realized on the statements of operations.

Interest Income

Interest income is recorded on an accrual basis.

Note 3. FEES

Organizational, General and Administrative Costs

Preferred pays all administrative costs for services it performs for the Trust. These costs include, but are not limited to, those discussed in Note 4 below.

Preferred also pays all routine legal, audit, postage and other third party costs of the Trust. The Company allocates general and administrative costs on a pro-rata basis down to the Trust which are paid for by the Trust through its investment in the Company. The Trust pays for its pro-rata allocation of expenses incurred by the Company except for the Spectrum Global Fund Administration administrative fee.

Management and Incentive Fees

The Trust paid each trading manager a monthly management fee on the portion of the Trust’s net assets allocated to each trading manager as of the last day of each month through October 31, 2006. In addition, the Trust paid each trading manager a quarterly incentive fee based on “New High Net Trading Profits” (as defined in the advisory agreements among the Trust, the Managing Owner and each trading manager) through October 31, 2006. Effective November 1, 2006, the Trust pays its pro-rata share of management and incentive fees as disclosed in Note 2(d) through its investments in the Companies.

-12-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 3. FEES (CONTINUED)

Commissions

On October 1, 2004, an agreement was executed between Preferred and Prudential Financial Derivatives LLC (“PFD”), which amended and restated the brokerage agreement, including fees to be paid to PFD. The agreement incorporates the previous PFD brokerage agreement’s terms, revising the total fees paid by the Trust. Under the agreement, PFD will charge only transaction based fees effective October 1, 2004. Previously, PFD was paid a fixed monthly fee of ⁵/8 of 1% (7.5 per annum) of the Trust’s net asset value as of the first day of each month. Subsequent to October 1, 2004, this monthly charge is now paid to the Managing Owner as an administrative charge for its services.

Effective November 1, 2006, the Trust deducts the cost of its pro-rata share of commissions allocated from the Companies in calculation of the Managing Owner’s 7.5% per annum administrative charge.

Note 4. RELATED PARTIES

The Managing Owner or parties engaged by the Managing Owner perform services for the Trust, which included but are not limited to: accounting and financial management; registrar, transfer and assignment functions; investor communications; printing and other administrative services. Except for costs related to brokerage services, Preferred pays the costs of these services incurred on behalf of the Trust as well as the Trust’s routine operational, administrative, legal and auditing costs, and costs paid to organize the Trust and offer its Interests.

Costs and expenses charged to the Trust for services performed and/or paid for by the Managing Owner on behalf of the Trust for the years ended December 31, 2008, 2007 and 2006 were:


	2008		2007		2006
Administrative services	$	299,718	$	335,522	$	434,382


	$	299,718	$	335,522	$	434,382

Expenses payable to the Managing Owner and its affiliates (which are included in accounts payable less any receivable from the Managing Owner on the Statements of Financial Condition) as of December 31, 2008 and 2007 were $11,647 and $22,482, respectively

Note 5. INVESTMENTS IN THE COMPANIES

From November 1, 2006 to March 31, 2007, the Trust invested its assets in the Trading Vehicle. The Trust’s investment in the Trading Vehicle represented approximately 16.87% and 18.22% of the net asset value of the Trading Vehicle at March 31, 2007 and December 31, 2006, respectively. The investment in the Trading Vehicle was subject to the Organization Agreement of the Trading Vehicle. The Trading Vehicle entered into an advisory agreement with Bridgewater to make the trading decisions for the Trading Vehicle. Bridgewater managed approximately 100% of the assets of the Trading Vehicle pursuant to the Aggressive Pure Alpha Futures Only program – A, No Benchmark program. On April 30, 2007, the Managing Owner terminated the Trading Advisor agreement with Bridgewater.

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FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 5. INVESTMENTS IN THE COMPANIES (CONTINUED)

Effective April 1, 2007, the Trust withdrew its assets from the Trading Vehicle and invested them in the Company. The Trust’s investment in the Company represents approximately 24.36% and 20.83% of the net asset value of the Company at December 31, 2008 and 2007, respectively. The investment in the Company is subject to the Organization Agreement of the Company. The Company entered into an advisory agreement with Winton Capital Management (“Winton”) whereby Winton makes the trading decisions for the Company and, in turn, the Trust, pursuant to Winton’s Diversified Program.

The Trust records its proportionate share of each item of income and expense from its investments in the Companies in the statement of operations.

Summarized information for the Trust’s investments is as follows:


	Net Asset Value December 31, 2007		Investments		Gain*			Redemptions			Net Asset Value December 31, 2008
WCM Pool LLC	$	4,196,579	$	0	$	717,713		$	(985,274	)	$	3,929,018


	Net Asset Value December 31, 2006		Investments		Gain (Loss)*			Redemptions			Net Asset Value December 31, 2007
WCM Pool LLC	$	0	$	5,002,950	$	876,623		$	(1,682,994	)	$	4,196,579

WMT III Series H/J Trading Vehicle LLC	$	5,286,137	$	0	$	(60,065	)	$	(5,226,072	)	$	0


	Net Asset Value December 31, 2005		Investments		Loss*			Redemptions			Net Asset Value December 31, 2006
WMT III Series H/J Trading Vehicle LLC	$	0	$	5,372,605	$	(46,457	)	$	(40,011	)	$	5,286,137

* Included in earnings and includes ($36,149), $17,674 and ($92,871), and $195,788 for 2008, 2007 and 2006, respectively, attributable to the change in unrealized gains and losses.

The Trust may make additional contributions to, or redemptions from, the Company on a monthly basis.

Certain expenses allocated to the Trust from the Company are reimbursed by the Managing Owner at the Trust level.

Note 6. INCOME TAX REPORTING

There have been no differences between the tax basis and book basis of assets, liabilities or interest holders’ capital since inception of the Trust.

Note 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS

The Trust’s investments in the Companies are subject to the market and credit risks of the futures contracts, options on futures contracts, forward currency contracts and other financial instruments held or sold short by the Companies. The Trust bears the risk of loss only to the extent of the market value of its investments and, in certain specific circumstances, distributions and redemptions received.

-14-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)

Market Risk

Trading in futures and forward contracts (including foreign exchange) involves entering into contractual commitments to purchase or sell a particular commodity at a specified date and price. Through October 31, 2006, the gross or face amount of the contracts, which was typically many times that of the Trust’s net assets being traded, significantly exceeded the Trust’s future cash requirements since the Trust intended to close out its open positions prior to settlement. As a result, the Trust was generally subject only to the risk of loss arising from the change in the value of the contracts. As such, the Trust considered the “fair value” of its derivative instruments to be the net unrealized gain or loss on the contracts. The market risk associated with the Trust’s commitments to purchase commodities was limited to the gross or face amount of the contracts held. However, when the Trust entered into a contractual commitment to sell commodities, it had to make delivery of the underlying commodity at the contract price and then repurchase the contract at prevailing market prices or settle in cash. Since the repurchase price to which a commodity can rise is unlimited, entering into commitments to sell commodities exposed the Trust to unlimited risk.

Market risk is influenced by a wide variety of factors, including government programs and policies, political and economic events, the level and volatility of interest rates, foreign currency exchange rates, the diversification effects among the derivative instruments the Trust held and the liquidity and inherent volatility of the markets in which the Trust traded.

Beginning, November 1, 2006 the Trust through its investment in the companies, is exposed to the market risk as disclosed in Section II and Section III, which should be read in conjunction with this report.

Credit Risk

Through October 31, 2006, when entering into futures or forward contracts, the Trust was exposed to credit risk that the counterparty to the contract would not meet its obligations. The counterparty for futures contracts traded on United States and most foreign futures exchanges is the clearinghouse associated with the particular exchange. In general, clearinghouses are backed by their corporate members who are required to share any financial burden resulting from the non-performance by one of their members and, as such, should significantly reduce this credit risk. In cases where the clearinghouse is not backed by the clearing members (i.e. some foreign exchanges), it is normally backed by a consortium of banks or other financial institutions. On the other hand, there was concentration risk on forward transactions entered into by the Trust as the Trust’s commodity broker was the sole counterparty. The Trust had entered into a master netting agreement with its broker and, as a result when applicable, presented unrealized gains and losses on open forward positions as a net amount in the statements of financial condition; however, counterparty non-performance on only certain of the Trust’s contracts may have resulted in greater loss than non-performance on all of the Trust’s contracts. The amount at risk associated with counterparty non-performance of all of the Trust’s contracts was the net unrealized gain included in the statements of financial condition. There could be no assurance that any counterparty, clearing member or clearinghouse would meet its obligations to the Trust.

Beginning, November 1, 2006 the Trust through its investment in the companies, is exposed to the credit risk as disclosed in Section II and Section III, which should be read in conjunction with this report.

-15-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)

The Managing Owner attempted to minimize both credit and market risks by requiring the Trust and its trading managers to abide by various trading limitations and policies. The Managing Owner monitored compliance with these trading limitations and policies, which included, but are not limited to, executing and clearing all trades with creditworthy counterparties; limiting the amount of margin or premium required for any one commodity or all commodities combined; and generally limiting transactions to contracts which were traded in sufficient volume to permit the taking and liquidating of positions. Additionally, pursuant to the Advisory Agreement among the Trust, the Managing Owner had the right, among others, to terminate each trading manager if the net asset value allocated to the trading manager declined by 33¹/3% from the value at the beginning of any year or since the commencement of trading activities. Furthermore, the Amended and Restated Declaration of Trust and Trust Agreement provided that the Trust would liquidate its positions, and eventually dissolve, if the Trust experienced a decline in the net asset value of 50% from the value at the beginning of any year or since the commencement of trading activities. In each case, the decline in net asset value was after giving effect for distributions and redemptions. The Managing Owner may have imposed additional restrictions (through modifications of trading limitations and policies) upon the trading activities of the trading manager as it, in good faith, deemed to be in the best interests of the Trust.

The Trust has cash on deposit with financial institutions. In the event of a financial institution’s insolvency, recovery of cash on deposit may be limited to account insurance or other protection afforded such deposits. The Managing Owner has established procedures to actively monitor market risk and minimize credit risk, although there can be no assurance that it will, in fact, succeed in doing so. The Interestholders bear the risk of loss only to the extent of the market value of their respective investments and, in certain specific circumstances, distributions and redemptions received.

The Trust’s futures commission merchant in accepting orders for the purchase or sale of domestic futures contracts, is required by CFTC regulations to separately account for and segregate as belonging to the Trust all assets of the Trust relating to domestic futures trading and is not to commingle such assets with its other assets. At December 31, 2008 and 2007, such segregated assets totaled $0 and $1,012, respectively which are included in cash and cash equivalents on the statements of financial condition. Part 30.7 of the CFTC regulations also requires the futures commission merchant to secure assets of the Trust related to foreign futures trading which totaled $0 and $0 at December 31, 2008 and 2007, respectively. There are no segregation requirements for assets related to forward trading.

-16-

FUTURES STRATEGIC TRUST

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 8. FINANCIAL HIGHLIGHTS

The following information presents per Interest performance operating data and other supplemental financial data for the years ended December 31, 2008, 2007 and 2006. This information has been derived from information presented in the financial statements.


	2008			2007			2006
Per Interest Performance (for an Interest outstanding throughout the entire year)

Net asset value, beginning of year	$	111.60		$	100.24		$	99.36


Net realized gain and change in net unrealized gain on commodity transactions⁽¹⁾		27.21	⁽⁵⁾		22.01	⁽³⁾		5.51	⁽⁴⁾
Interest income⁽¹⁾		1.44	⁽⁵⁾		4.37	⁽³⁾		5.37	⁽⁴⁾
Expenses⁽¹⁾		(16.94	)⁽⁵⁾		(15.02	)⁽³⁾		(10.00	)⁽⁴⁾


Net increase for the year		11.71			11.36			0.88


Net asset value, end of year	$	123.31		$	111.60		$	100.24


Total Return:
Total return before incentive fees		14.64	%		15.41	%		1.28	%
Incentive fees		(4.15	)%		(4.08	)%		(0.39	)%


Total return after incentive fees		10.49	%		11.33	%		0.89	%


Supplemental Data

Ratios to average net asset value:
Net investment loss before incentive fees⁽²⁾		(8.91	)%⁽⁵⁾		(6.19	)%⁽³⁾		(4.06	)%⁽⁴⁾
Incentive fees		(4.15	)%⁽⁵⁾		(4.08	)%⁽³⁾		(0.39	)%⁽⁴⁾


Net investment loss after incentive fees		(13.06	)%⁽⁵⁾		(10.27	)%⁽³⁾		(4.45	)%⁽⁴⁾


Interest income		1.21	%⁽⁵⁾		4.21	%⁽³⁾		5.17	%⁽⁴⁾


Incentive fees		4.15	%⁽⁵⁾		4.08	%⁽³⁾		0.39	%⁽⁴⁾
Other expenses		10.12	%⁽⁵⁾		10.40	%⁽³⁾		9.23	%⁽⁴⁾


Total net expenses		14.27	%⁽⁵⁾		14.48	%⁽³⁾		9.62	%⁽⁴⁾

Total returns are calculated based on the change in value of an Interest during the year. An individual Interestholder’s total returns and ratios may vary from the above total returns and ratios based on the timing of redemptions.

⁽¹⁾

Interest income per Interest and expenses per Interest are calculated by dividing interest income and expenses by the weighted average number of Interests outstanding during the year. Net realized gain and change in net unrealized gain on commodity transactions is a balancing amount necessary to reconcile the change in net asset value per Interest with the other per Interest information.

⁽²⁾

Represents interest income less total expenses (exclusive of incentive fees).

⁽³⁾

Includes the Trust’s proportionate share of income and expenses from WMT III Series H/J Trading Vehicle LLC from January 1, 2007 to March 31, 2007 and the Trust’s proportionate share of income and expenses from WCM Pool LLC from April 1, 2007 to December 31, 2007.

⁽⁴⁾

Represents income (loss) and expenses from the Trust’s operations and the Trust’s proportionate share of income and expenses from WMT III Series H/J Trading Vehicle LLC from November 1, 2006 to December 31, 2006.

⁽⁵⁾

Includes the Trust’s proportionate share of income and expenses from WCM Pool LLC for the year ended December 31, 2008.

-17-

SECTION II

WCM POOL LLC

FINANCIAL STATEMENTS

December 31, 2008

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Members of

WCM Pool LLC

We have audited the accompanying statements of financial condition, including the condensed schedules of investments, of WCM Pool LLC (the “Company”) as of December 31, 2008 and 2007, and the related statements of operations and changes in members’ capital (net asset value) and the financial highlights for the years ended December 31, 2008 and 2007. These financial statements and the financial highlights are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of WCM Pool LLC at December 31, 2008 and 2007, and the results of its operations and changes in its members’ capital (net asset value) and the financial highlights for the years ended December 31, 2008 and 2007, in conformity with accounting principles generally accepted in the United States of America.

Eisner LLP

New York, New York

March , 2009

WCM POOL LLC

STATEMENTS OF FINANCIAL CONDITION

December 31, 2008 and 2007


	2008		2007
ASSETS
Cash and cash equivalents (See Note 2)	$	19,431,990	$	20,525,950
Interest receivable		479		47,642
Net unrealized gain on open futures contracts		269,887		434,983


Total assets	$	19,702,356	$	21,008,575


LIABILITIES
Accrued expenses	$	38,738	$	33,955
Management fees payable		66,550		70,084
Incentive fees payable		100,116		174,235
Redemptions payable		3,367,541		580,258


Total liabilities		3,572,945		858,532


MEMBERS’ CAPITAL (Net Asset Value)
Member DFF LP		0		3,165,178
Member DFT I		11,561,900		11,055,308
Member KGT		638,493		1,732,978
Member FST		3,929,018		4,196,579


Total members’ capital (Net Asset Value)		16,129,411		20,150,043


Total liabilities and members’ capital	$	19,702,356	$	21,008,575

See accompanying notes.

-2-

WCM POOL LLC

CONDENSED SCHEDULES OF INVESTMENTS

December 31, 2008 and 2007


	2007					2008
	Net Unrealized Gain (Loss) as a % of Members’ Capital		Net Unrealized Gain (Loss)			Net Unrealized Gain (Loss) as a % of Members’ Capital		Net Unrealized Gain (Loss)
Futures Contracts

Futures contracts purchased:
Commodities	0.00	%	$	32		1.82	%	$	367,154
Currencies	0.20	%		31,725		(0.24	)%		(49,036	)
Interest rates	2.32	%		375,048		0.57	%		115,021
Stock indices	0.00	%		0		0.09	%		17,163


Net unrealized gain on futures contracts purchased	2.52	%		406,805		2.24	%		450,302


Futures contracts sold:
Commodities	(0.27	)%		(43,517	)	(0.01	)%		(1,873	)
Currencies	(0.58	)%		(92,971	)	(0.05	)%		(9,014	)
Interest rates	0.00	%		(833	)	(0.04	)%		(8,288	)
Stock indices	0.00	%		403		0.02	%		3,856


Net unrealized loss on futures contracts sold	(0.85	)%		(136,918	)	(0.08	)%		(15,319	)


Net unrealized gain on open futures contracts	1.67	%	$	269,887		2.16	%	$	434,983

See accompanying notes.

-3-

WCM POOL LLC

STATEMENTS OF OPERATIONS

For the Years Ended December 31, 2008 and 2007


	2008			2007
REVENUES
Realized	$	4,820,038		$	2,899,882
Change in unrealized		(165,096	)		434,983
Interest income		241,413			804,211


Total revenues		4,896,355			4,139,076


EXPENSES
Brokerage commissions		31,212			79,343
Management fees		409,728			414,865
Incentive fees		830,827			562,491
Operating expenses		141,244			101,748


Total expenses		1,413,011			1,158,447


NET INCOME	$	3,483,344		$	2,980,629

See accompanying notes.

-4-

WCM POOL LLC

STATEMENTS OF CHANGES IN MEMBERS’ CAPITAL (NET ASSET VALUE)

For the Years Ended December 31, 2008 and 2007


	Members’ Capital
	Member DFF LP			Member DFT I			Member KGT			Member FST			Total
Balances at January 1, 2007	$	0		$	0		$	0		$	0		$	0

Additions		3,636,165			12,966,087			2,143,975			5,002,950			23,749,177

Redemptions		(888,949	)		(3,353,004	)		(654,816	)		(1,682,994	)		(6,579,763	)

Net income for the year ended December 31, 2007		417,962			1,442,225			243,819			876,623			2,980,629


Balances at December 31, 2007		3,165,178			11,055,308			1,732,978			4,196,579			20,150,043

Redemptions		(3,720,425	)		(1,479,113	)		(1,319,164	)		(985,274	)		(7,503,976	)

Net income for the year ended December 31, 2008		555,247			1,985,705			224,679			717,713			3,483,344


Balances at December 31, 2008	$	0		$	11,561,900		$	638,493		$	3,929,018		$	16,129,411

See accompanying notes.

-5-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS

December 31, 2008

Note 1. ORGANIZATION

General Description of the Company

WCM Pool LLC (the “Company”) is a limited liability company organized under the laws of Delaware on November 20, 2006 and commenced operations on January 1, 2007. The Company will terminate on December 31, 2056 unless terminated sooner under the provisions of the Organization Agreement. The Company was formed to engage in the speculative trading of a diversified portfolio of futures contracts, options on futures contracts and forward currency contracts and may, from time to time, engage in cash and spot transactions. Preferred Investment Solutions Corp. (“Preferred”) has been delegated administrative authority over the operations of the Company. The Company consists of three members: Diversified Futures Trust I (“Member DFT I”), Futures Strategic Trust (“Member FST”) and Kenmar Global Trust (“Member KGT”) (collectively, the “Members”) as of December 31, 2008. Diversified Futures Fund L.P. (“Member DFF LP”) redeemed all of its membership interests in the Company and terminated its fund operations as of December 31, 2008. Member DFT I, Member KGT and Member DFF LP contributed their net assets to the Company effective January 1, 2007, while Member FST invested in the Company on April 1, 2007. Preferred is also the Managing Owner of each of the Members. Upon making the initial capital contribution, each Member received Voting Membership Interests.

The Company is a Member-managed limited liability company that is not registered in any capacity with, or subject directly to regulation by, the Commodity Futures Trading Commission (“CFTC”) or the United States Securities and Exchange Commission.

The Trading Advisor

The Company entered into an advisory agreement with Winton Capital Management Limited (the “Trading Advisor”) to make the trading decisions for the Company. The Trading Advisor manages approximately 100% of the assets of the Company pursuant to its Diversified Program Portfolio.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The financial statements of the Company are prepared in accordance with accounting principles generally accepted in the United States of America, which require the Managing Member to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Commodity futures and foreign exchange transactions are reflected in the accompanying statement of financial condition on a trade date basis. Net unrealized gain or loss on open contracts (the difference between contract trade price and market price) is reflected in the financial statements in accordance with Financial Accounting Standards Board (“FASB”) Interpretation No. 39 – “Offsetting of Amounts Related to Certain Contracts.” The market value of futures (exchange-traded) contracts is based upon the closing quotation on the various futures exchanges on which the contract is traded. The values which will be used by the Company for open forward positions will be provided by its administrator, who obtains market quotes from data vendors and third parties.

-6-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

Any change in net unrealized gain or loss during the current period is reported in the statement of operations. Realized gains and losses on transactions are recognized in the period in which the contracts are closed. Brokerage commissions include other trading fees and are charged to expense when incurred.

The Company has elected not to provide a Statement of Cash Flows as permitted by Statement of Financial Accounting Standards (“SFAS”) No. 102, “Statement of Cash Flows – Exemption of Certain Enterprises and Classification of Cash Flows from Certain Securities Acquired for Resale.”

Consistent with standard business practices in the normal course of business, the Company has provided general indemnifications to its Trading Advisor and others when they act, in good faith, in the best interests of the Company. The Company is unable to develop an estimate of the maximum potential amount of future payments that could potentially result from any hypothetical future claim, but expects the risk of having to make any payments under these general business indemnifications to be remote.

In July 2006, the FASB issued FASB Interpretation (“FIN”) No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement No. 109” (“FIN 48”), which clarifies the accounting for uncertainty in tax positions. FIN 48 requires that the Company recognize in its financial statements, the impact of a tax position if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The provisions of FIN 48 were effective for fiscal years beginning after December 15, 2006, with the cumulative effect of the change in accounting principle recorded as an adjustment to opening retained earnings. In connection with the adoption of FIN 48, the Company has elected an accounting policy to classify interest and penalties related to unrecognized tax benefits as interest or other expense. All tax years which are statutorily open are subject to examination by the appropriate taxing authorities. Preferred, evaluated the impact of adopting FIN 48 on the Company’s financial statements. The adoption of FIN 48 had no material impact on the Company, as the Company’s tax positions are based on established tax precedence for the tax treatment of investment partnerships as flow-through tax entities.

-7-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

The Company adopted SFAS 157 in the first quarter of 2008. The adoption of SFAS 157 had no impact on the investments required to be carried at fair value in these financial statements. The Company considers prices for exchange traded commodity futures and options contracts to be based on quoted prices in active markets for identical assets (Level 1). The values of forwards, swaps and certain option contracts for which market quotations are not readily available are priced by third party data providers such as Bloomberg, Reuters, and or Super Derivatives who derive fair values for those assets from models with observable inputs (Level 2). There are no Level 3 investments on December 31, 2008 or 2007 using the fair value hierarchy of SFAS 157.

The following table summarizes the assets and liabilities measured at fair value using the fair value hierarchy of SFAS 157:


December 31, 2008	Level 1		Level 2		Level 3		Total
Assets:
Net unrealized gain on open futures contracts	$	269,887	$	0	$	0	$	269,887

December 31, 2007	Level 1		Level 2		Level 3		Total
Assets:
Net unrealized gain on open futures contracts	$	434,983	$	0	$	0	$	434,983

In October 2008, the FASB issued FASB Staff Position FAS 157-3, “Determining the Fair Value of a Financial Asset When the Market for That Asset Is Not Active” (“FSP FAS 157-3”). FSP FAS 157-3 clarified the application of SFAS 157. FSP FAS 157-3 demonstrated how the fair value of a financial asset is determined when the market for that financial asset is inactive. FSP FAS 157-3 was effective upon issuance, including prior periods for which financial statements had not been issued. Preferred, evaluated the impact of adopting FSP 157-3 on the Company’s financial statements. The adoption of this standard did not have an impact on the Company’s financial statements.

In February 2007, the FASB issued SFAS No. 159 (“SFAS 159”), “The Fair Value Option for Financial Assets and Financial Liabilities”, including an amendment of SFAS 115. This statement provides companies with an option to report selected financial assets and liabilities at fair value. This statement is effective for fiscal years beginning after November 15, 2007 with early adoption permitted. Preferred, evaluated the impact of adopting SFAS 159 and its impact on Company’s financial statements.

The Company adopted SFAS 159 during the first quarter of 2008, and it did not have a material effect on the Company’s financial statements, as the Company did not elect the fair value option for any eligible financial assets or liabilities.

-8-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

In April 2007, the FASB released FASB Staff Position FIN No. 39-1 “Offsetting of Amounts Related to Certain Contracts” (“FSP FIN 39-1”). FSP FIN 39-1 requires that offsetting of assets and liabilities in the balance sheet is improper except where a right of setoff exists. The application of FSP FIN 39-1 is required for fiscal years beginning after November 15, 2007 and interim period within those fiscal years. Preferred, evaluated the impact of adopting FSP FIN 39-1 and its impact on the Company’s financial statements. The adoption of this standard did not have an impact on the Company’s financial statements.

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities – an amendment of FASB Statement No. 133” (“SFAS 161”). SFAS 161 establishes, among other things, the disclosure requirements for derivative instruments and for hedging activities. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. Preferred, evaluated the impact of adopting SFAS 161 on the Company’s financial statements. The adoption of this standard is not expected to have an impact on the Company’s financial statements.

Cash and Cash Equivalents

Cash includes amounts deposited with a bank and clearing brokers, a portion of which is restricted for purposes of meeting margin requirements, which typically range from 0% to 35% of the notional amounts of the derivatives traded. As of December 31, 2008 and 2007 restricted cash totaled $670,420 and $1,726,651 respectively. The Company receives interest on all cash balances held by the bank and clearing brokers at prevailing interest rates.

Income Taxes

The Company is treated as a partnership for Federal income tax purposes. As such, the Company is not required to provide for, or pay, any Federal or state income taxes. Income tax attributes that arise from its operations are passed directly to the Members. The Company may be subject to other state and local taxes in jurisdictions in which it operates.

Capital Accounts

The Company accounts for subscriptions, allocations and redemptions on a per member capital account basis.

The Company allocates profits and losses, prior to calculation of the incentive fee, for both financial and tax reporting purposes to its Members monthly on a pro rata basis based on each Member’s pro rata capital in the Company during the month. Each Member is then charged with the applicable incentive fee. Distributions (other than redemptions of capital) may be made at the sole discretion of the Members on a pro rata basis in accordance with the Members’ respective capital balances. The Company has not made and does not presently intend to make, any distributions.

-9-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Foreign Currency Transactions

The Company’s functional currency is the U.S. dollar; however, it transacts business in currencies other than the U.S. dollar. Assets and liabilities denominated in currencies other than the U.S. dollar are translated into U.S. dollars at the rates in effect at the date of the statements of financial condition. Income and expense items denominated in currencies other than U.S. dollars are translated into U.S. dollars at the rates in effect during the period. Gains and losses resulting from the translation to U.S. dollars are reported in operations currently under the caption realized in the statements of operations.

Interest Income

Interest income is recorded on an accrual basis.

Note 3. FEES

Operating Expenses

Operating expenses of the Company are paid for by the Company.

Management and Incentive Fees

The Company accrues and pays the Trading Advisor a management fee at an annual rate of 2% of the Company’s Net Assets determined as of the close of business each month. For purposes of determining the management fee, any distributions, redemptions or reallocation of assets made as of the last day of the month shall be added back to the assets and there shall be no reduction for (i) the management fees calculated or (ii) any accrued but unpaid incentive fees due the Trading Advisor.

Additionally, the Company pays the Trading Advisor a quarterly incentive fee of 20% (the “Incentive Fee”) of “New High Net Trading Profits” (as defined in the Advisory Agreement). For the years ended December 31, 2008 and 2007, the Trading Advisor earned incentive fees of $830,827 and $562,491, respectively, of which $100,116 and $174,235 remains payable at December 31, 2008 and 2007 respectively.

Commissions

The Company is obligated to pay all floor brokerage expenses, give-up charges and National Futures Association clearing and exchange fees incurred in connection with the Company’s commodity trading activities.

Note 4. RELATED PARTIES

The Company reimburses Preferred for services it performs for the Company, which include, but are not limited to: management, accounting, printing, and other administrative services.

The expenses incurred by the Company for services performed by Preferred for the Company for the years ended December 31, 2008 and 2007 were:

-10-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 4. RELATED PARTIES (CONTINUED)

Expenses payable to Preferred and its affiliates as of December 31, 2008 and 2007 were $7,480, and $0, respectively which are included in accrued expenses on the statement of financial condition.

Note 5. INCOME TAXES

There have been no differences between the tax basis and book basis of assets, liabilities or members’ capital since inception of the Company.

Note 6. DEPOSITS WITH COMMODITY BROKER, PRIME BROKER AND BANK

The Company deposits funds with a commodity broker subject to CFTC regulations and various exchange and commodity broker requirements. Margin requirements are satisfied by the deposit of cash with such commodity broker. The Company earns interest income on assets deposited with the commodity broker. The Company also deposits funds with a prime broker. Margin requirements are satisfied by the deposit of cash with such prime broker. The Company earns interest income on assets deposited with its prime broker. The Company also earns interest on funds deposited with JPMorgan Chase Bank, Nassau branch.

Note 7. SUBSCRIPTIONS, DISTRIBUTIONS AND REDEMPTIONS

Investments in the Company are made subject to the terms of the Organization Agreement.

The Company is not required to make distributions, but could do so at the discretion of the Members. A Member can request and receive redemption of capital, subject to the terms in the Organization Agreement.

Note 8. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS

The Company has cash on deposit with financial institutions. In the event of a financial institution’s insolvency, recovery of cash on deposit may be limited to account insurance or other protection afforded such deposits.

The Company is exposed to various types of risks associated with the derivative instruments and related markets in which it invests. These risks include, but are not limited to, risk of loss from fluctuations in the value of derivative instruments held (market risk) and the inability of counterparties to perform under the terms of the Company’s investment activities (credit risk).

-11-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 8. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)

Market Risk (Continued)

The market risk associated with the Company’s commitments to purchase commodities is limited to the gross or face amount of the contract held. However, when the Company enters into a contractual commitment to sell commodities, it must make delivery of the underlying commodity at the contract price and then repurchase the contract at prevailing market prices or settle in cash. Since the repurchase price to which a commodity can rise is unlimited, entering into commitments to sell commodities exposes the Company to unlimited risk.

Market risk is influenced by a wide variety of factors, including government programs and policies, political and economic events, the level and volatility of interest rates, foreign currency exchange rates, the diversification effect among the derivative instruments the Company holds and the liquidity and inherent volatility of the markets in which the Company trades.

Credit Risk

When entering into futures or forward contracts, the Company is exposed to credit risk that the counterparty to the contract will not meet its obligations. The counterparty for futures contracts traded on United States and most foreign futures exchanges is the clearinghouse associated with the particular exchange. In general, a clearinghouse is backed by its corporate members who are required to share any financial burden resulting from the non-performance by one of their members and, as such, should significantly reduce this credit risk. In cases where the clearinghouse is not backed by the clearing members (i.e., some foreign exchanges), it is normally backed by a consortium of banks or other financial institutions. On the other hand, there is concentration risk on forward transactions entered into by the Company, as the Company’s forward broker is the sole counterparty. The Company has entered into a master netting agreement with its forward broker and, as a result, when applicable, presents unrealized gains and losses on open forward positions as a net amount in the statements of financial condition. The amount at risk associated with counterparty non-performance of all of the Company’s contracts is the net unrealized gain or loss included in the statements of financial condition; however, counterparty non-performance on only certain of the Company’s contracts may result in greater loss than non-performance on all of the Company’s contracts. There can be no assurance that any counterparty, clearing member or clearinghouse will meet its obligations to the Company.

Preferred attempts to minimize both credit and market risks by requiring the Company and its Trading Advisor to abide by various trading limitations and policies. Preferred monitors compliance with these trading limitations and policies, which include, but are not limited to, executing and clearing all trades with creditworthy counterparties; limiting the amount of margin or premium required for any one commodity or all commodities combined; and generally limiting transactions to contracts which are traded in sufficient volume to permit the taking and liquidating of positions.

-12-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 8. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)

Credit Risk (Continued)

Additionally, pursuant to the Advisory Agreement among the Company, Preferred and the Trading Advisor, the Company shall automatically terminate the Trading Agreement, if the net asset value allocated to the Trading Advisor declines by 40% from the value at the beginning of any year or since the effective date of the Advisory Agreement. The decline in net asset value is after giving effect for distributions, subscriptions and redemptions.

The Company’s futures commission merchant, in accepting orders for the purchase or sale of domestic futures contracts, is required by CFTC regulations to separately account for and segregate as belonging to the Company all assets of the Company relating to domestic futures trading and is not allowed to commingle such assets with its other assets. At December 31, 2008 and 2007, such segregated assets totaled $12,595,893 and $17,941,562, respectively, which are included in cash and cash equivalents on the statements of financial condition. Part 30.7 of the CFTC regulations also requires the Company’s futures commission merchant to secure assets of the Company related to foreign futures trading which totaled $1,274,591 and $48,961 at December 31, 2008 and 2007, respectively. There are no segregation requirements for assets related to forward trading.

As of December 31, 2008, all open futures contracts mature within eighteen months.

-13-

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

December 31, 2008

Note 9. FINANCIAL HIGHLIGHTS

The following information presents the financial highlights of the Company for the years ended December 31, 2008 and 2007. This information has been derived from information presented in the financial statements.


	December 31, 2008								December 31, 2007
	Member DFF LP		Member DFT I		Member KGT		Member FST		Member DFF LP		Member DFT I		Member KGT		Member FST⁽⁵⁾
Total return ^{(1), (4)}

Total return before incentive fee	23.44	%	23.44	%	23.44	%	23.44	%	15.84	%	15.84	%	15.84	%	26.12	%
Incentive fee	(4.69	)%	(4.69	)%	(4.69	)%	(4.69	)%	(2.43	)%	(2.42	)%	(2.51	)%	(4.92	)%


Total return after incentive fee	18.75	%	18.75	%	18.75	%	18.75	%	13.41	%	13.42	%	13.33	%	21.20	%

Ratios to average net asset values⁽⁶⁾:
Expenses prior to incentive fee⁽²⁾	2.92	%	2.91	%	3.06	%	2.92	%	2.93	%	2.92	%	2.92	%	2.97	%
Incentive fee⁽¹⁾	4.15	%	4.09	%	4.92	%	4.18	%	2.21	%	2.18	%	2.30	%	4.26	%

Total expenses and incentive fee	7.07	%	7.00	%	7.98	%	7.10	%	5.14	%	5.10	%	5.22	%	7.23	%

Net investment income (loss) ^{(2), (3)}	(1.71	)%	(1.72	)%	(1.66	)%	(1.71	)%	1.00	%	1.01	%	1.07	%	1.05	%

Total returns are calculated based on the change in value of Members’ capital during the period. An individual Member’s total returns and ratios may vary from the above total returns and ratios based on the timing of additions and redemptions

⁽¹⁾

Not annualized.

⁽²⁾

Annualized.

⁽³⁾

Represents interest income less total expenses (exclusive of incentive fee).

⁽⁴⁾

Includes realized and unrealized gains (losses) on securities transactions.

⁽⁵⁾

Member FST contributed its net assets to the Company effective April 1, 2007.

⁽⁶⁾

Member DFF LP, ratios to average net asset values for the year ended December 31, 2008, were calculated prior to its liquidating redemptions from the Company.

Note 10. SUBSEQUENT EVENT

Effective April 1, 2009, World Monitor Trust II Series D and F will contribute their net assets to the Company and receive Voting Membership Interests as new Members of the Company.

-14-

SECTION III

WMT III SERIES H/J TRADING VEHICLE LLC

FINAL ANNUAL REPORT

As of April 30, 2007 (Date of Liquidation) and December 31, 2006

And for the Periods from January 1, 2007 to April 30, 2007 (Date of Liquidation) and

For the Year Ended December 31, 2006

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Managing Owner and Members of

World Monitor Trust III Series H/J Trading Vehicle LLC

We have audited the accompanying statements of financial condition, including the condensed schedules of investments, of World Monitor Trust III Series H/J Trading Vehicle LLC (the “Trading Vehicle”) as of April 30, 2007 (Date of Liquidation) and December 31, 2006, and the related statements of operations and changes in members’ capital for the period from January 1, 2007 to April 30, 2007 (Date of Liquidation) and the year ended December 31, 2006. These financial statements are the responsibility of the Trading Vehicle’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Trading Vehicle is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Trading Vehicle’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of World Monitor Trust III Series H/J Trading Vehicle LLC at April 30, 2007 (Date of Liquidation) and December 31, 2006, and the results of its operations and changes in its members’ capital for the period from January 1, 2007 to April 30, 2007 (Date of Liquidation) and the year ended December 31, 2006 in conformity with accounting principles generally accepted in the United States of America.

Deloitte & Touche LLP

New York, New York

July 25, 2007

WMT III SERIES H/J TRADING VEHICLE LLC

STATEMENTS OF FINANCIAL CONDITION

April 30, 2007 (Date of Liquidation) and December 31, 2006


	April 30, 2007		December 31, 2006
ASSETS
Cash and cash equivalents	$	6,867	$	0
Cash in commodity trading accounts		24,557,766		28,463,857
Net unrealized gain on open futures contracts		0		622,289
Interest receivable		0		114,572


Total assets	$	24,564,633	$	29,200,718


LIABILITIES
Accrued expenses	$	75,138	$	32,141
Commissions payable		0		8,336
Redemptions payable		24,219,558		0
Advisor fee payable		269,937		73,255


Total liabilities		24,564,633		113,732


MEMBERS’ CAPITAL (Net Asset Value)
Member H - Class I		0		1,140,902
Member H - Class II		0		444,359
Member J - Class I		0		21,153,067
Member J - Class II		0		1,062,521
Member - Futures Strategic Trust		0		5,286,137


Total members’ capital (Net Asset Value)		0		29,086,986


Total liabilities and members’ capital	$	24,564,633	$	29,200,718

See accompanying notes.

-2-

WMT III SERIES H/J TRADING VEHICLE LLC

CONDENSED SCHEDULES OF INVESTMENTS

April 30, 2007 (Date of Liquidation) and December 31, 2006


	April 30, 2007				December 31, 2006
	Net Unrealized Gain(Loss)		Net Unrealized Gain(Loss) as a % of Net Asset Value*		Net Unrealized Gain(Loss)			Net Unrealized Gain(Loss) as a % of Net Asset Value
Long futures contracts:
Commodities	$	0	0.00	%	$	4,903		0.02	%
Currencies		0	0.00	%		(455,693	)	(1.57	)%
Energy		0	0.00	%		(18,370	)	(0.06	)%
Interest rates		0	0.00	%		(202,599	)	(0.70	)%
Metals		0	0.00	%		(76,930	)	(0.26	)%
Stock indices		0	0.00	%		20,644		0.07	%

Total long futures contracts		0	0.00	%		(728,045	)	(2.50	)%


Short futures contracts:
Currencies		0	0.00	%		(2,139	)	(0.01	)%
Interest rates		0	0.00	%		1,461,530		5.02	%
Metals		0	0.00	%		42,750		0.15	%
Stock indices		0	0.00	%		(151,807	)	(0.52	)%

Total short futures contracts		0	0.00	%		1,350,334		4.64	%


Total futures contracts	$	0	0.00	%	$	622,289		2.14	%

*	Prior to liquidating redemptions.

See accompanying notes.

-3-

WMT III SERIES H/J TRADING VEHICLE LLC

STATEMENTS OF OPERATIONS

For the Period January 1, 2007 to April 30, 2007 (Date of Liquidation) and

For the Year Ended December 31, 2006


	Period January 1, 2007 to April 30, 2007			Year Ended December 31, 2006
REVENUES
Realized	$	308,078		$	(2,317,174	)
Change in unrealized		(622,289	)		950,808
Interest income		419,797			926,433


Total revenues (loss)		105,586			(439,933	)


EXPENSES
Brokerage commissions		29,545			81,082
Advisor incentive fee		0			237,915
Advisor management fee		269,937			638,927
Operating expenses		63,839			57,341


Total expenses		363,321			1,015,265


NET LOSS	$	(257,735	)	$	(1,455,198	)

See accompanying notes.

-4-

WMT III SERIES H/J TRADING VEHICLE LLC

STATEMENTS OF CHANGES IN MEMBERS’ CAPITAL (NET ASSET VALUE)

For the Period January 1, 2007 to April 30, 2007 (Date of Liquidation) and

For the Year Ended December 31, 2006


	Members’ Capital
	Member H - Class I			Member H - Class II			Member J - Class I			Member J - Class II			Futures Strategic Trust			Total
Balance at December 31, 2005	$	515,430		$	0		$	10,152,980		$	0		$	0		$	10,668,410

Additions		1,154,252			528,000			13,133,733			1,177,042			5,372,605			21,365,632

Redemptions		(422,422	)		(9,587	)		(1,009,312	)		(10,526	)		(40,011	)		(1,491,858	)

Net loss		(106,358	)		(74,054	)		(1,124,334	)		(103,995	)		(46,457	)		(1,455,198	)


Balance at December 31, 2006		1,140,902			444,359			21,153,067			1,062,521			5,286,137			29,086,986

Additions		0			0			2,881,832			440,624			0			3,322,456

Redemptions		(109,663	)		(2,193	)		(1,610,471	)		(54,999	)		(5,226,072	)		(7,003,398	)

Net loss for the period January 1, 2007 to April 30, 2007		(9,425	)		(3,946	)		(173,276	)		(11,023	)		(60,065	)		(257,735	)


Members capital before liquidating redemptions		1,021,814			438,220			22,251,152			1,437,123			0			25,148,309

Liquidating redemptions		(1,021,814	)		(438,220	)		(22,251,152	)		(1,437,123	)		0			(25,148,309	)


Members’ capital at April 30, 2007	$	0		$	0		$	0		$	0		$	0		$	0

See accompanying notes.

-5-

WMT III SERIES H/J TRADING VEHICLE LLC

NOTES TO FINANCIAL STATEMENTS

Note 1. ORGANIZATION

General Description of the Trading Vehicle

WMT III Series H/J Trading Vehicle LLC (the “Trading Vehicle”) was a limited liability company organized under the laws of Delaware on March 10, 2005, which terminated on April 30, 2007 under the provisions of the Trading Vehicle’s Organization Agreement. The Trading Vehicle commenced trading operations on December 1, 2005. The Trading Vehicle was formed to engage in the speculative trading of a diversified portfolio of futures contracts and options on futures contracts. Preferred Investment Solutions Corp. (“Preferred” or the “Managing Owner”) was the Managing Owner of the Trading Vehicle. The Trading Vehicle consisted of five members: World Monitor Trust III – Series H, Class I (“Member H-Class I”), World Monitor Trust III – Series H, Class II (“Member H-Class II”), World Monitor Trust III – Series J, Class I (“Member J-Class I”), World Monitor Trust III – Series J, Class II (“Member J-Class II”) and Futures Strategic Trust (collectively, the “Members”). Preferred was also the Managing Owner of each of the Members. Upon making the initial capital contribution, each Member received Voting Membership Interests.

The Trading Vehicle was a member-managed limited liability company that was not registered in any capacity with, or subject directly to regulation by, the Commodity Futures Trading Commission (“CFTC”) or the United States Securities and Exchange Commission.

The Trading Advisor

The Trading Vehicle entered into an advisory agreement with Bridgewater Associates, Inc. (the “Trading Advisor”) to make the trading decisions for the Trading Vehicle. The Trading Advisor managed the assets in the Trading Vehicle pursuant to its Aggressive Pure Alpha Futures Only – A, No Benchmark program.

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The financial statements of the Trading Vehicle are prepared in accordance with accounting principles generally accepted in the United States of America, which require the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

-6-

WMT III SERIES H/J TRADING VEHICLE LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

Commodity futures transactions are reflected in the accompanying statement of financial condition on the trade date. Net unrealized gain or loss on open contracts (difference between contract trade price and market price) is reflected in the financial statements in accordance with Financial Accounting Standards Board Interpretation No. 39 – “Offsetting of Amounts Related to Certain Contracts.” The market value of futures (exchange-traded) contracts is based upon the closing quotation on the various futures exchanges on which the contract is traded. Any change in net unrealized gain or loss during the current period is reported in the statement of operations. Realized gains and losses on commodity transactions are recognized in the period in which the contracts are closed.

Brokerage commissions include other trading fees and are charged to expense when contracts are opened.

The Trading Vehicle has elected not to provide a Statement of Cash Flows as permitted by Statement of Financial Accounting Standards (“SFAS”) No. 102, “Statement of Cash Flows – Exemption of Certain Enterprises and Classification of Cash Flows from Certain Securities Acquired for Resale.”

Consistent with standard business practices in the normal course of business, the Trading Vehicle provided general indemnifications to its Trading Advisor and others when they act, in good faith, in the best interests of the Trading Vehicle. The Trading Vehicle is unable to develop an estimate of the maximum potential amount of future payments that could potentially result from any hypothetical future claim, but expects the risk of having to make any payments under these general business indemnifications to be remote.

In July 2006, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109” (“FIN 48”), which clarifies the accounting for uncertainty in tax positions. FIN 48 requires that the Trading Vehicle recognize in its financial statements the impact of a tax position if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The provisions of FIN 48 are effective for fiscal years beginning after December 15, 2006, with the cumulative effect of the change in accounting principle recorded as an adjustment to opening retained earnings.

-7-

WMT III SERIES H/J TRADING VEHICLE LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Accounting (Continued)

Preferred as Managing Owner of the Trading Vehicle has evaluated the impact of adopting FIN 48 on the Trading Vehicle’s financial statements. In Preferred’s opinion, the adoption of FIN 48 has no material impact on the Trading Vehicle, as the Trading Vehicle’s tax position is based on established tax precedence for the tax treatment of investment partnerships as flow through tax entities.

In September 2006, FASB issued SFAS No. 157, “Fair Value Measurements”, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The provisions of SFAS No. 157 are effective for fiscal years beginning after the Trading Vehicle’s liquidation. Given this, Preferred, as Managing Owner of the Trading Vehicle, has concluded that SFAS No. 157 has no impact on the Trading Vehicle’s financial statements.

Income Taxes

The Trading Vehicle is treated as a partnership for Federal income tax purposes. As such, the Trading Vehicle is not required to provide for, or pay, any Federal or state income taxes. Income tax attributes that arise from its operations are passed directly to the Members. The Trading Vehicle may be subject to other state and local taxes in jurisdictions in which it operates.

Capital Accounts

The Trading Vehicle accounted for additions, allocations of net gain (loss) and redemptions on a per member capital account basis.

The Trading Vehicle allocated profits and losses to its Members monthly on a pro rata basis based on each Member’s pro rata capital in the Trading Vehicle during the month. Distributions (other than redemptions of capital) were made at the sole discretion of the Members on a pro rata basis in accordance with the Members’ respective capital balances. The Trading Vehicle had not made any distributions prior to termination.

Foreign Currency Transactions

The Trading Vehicle’s functional currency was the U.S. dollar; however, it transacted business in currencies other than the U.S. dollar. Assets and liabilities denominated in currencies other than the U.S. dollar have been translated into U.S. dollars at the rates in effect at the date of the statement of financial condition. Income and expense items denominated in currencies other than U.S. dollars are translated into U.S. dollars at the rates in effect during the period. Gains and losses resulting from the translation to U.S. dollars are reported in operations currently.

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WMT III SERIES H/J TRADING VEHICLE LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Note 3. MANAGEMENT AND INCENTIVE FEES

The Trading Vehicle paid the Trading Advisor a monthly management fee equal to ¹/12 of 3.0% (3.0% annually) of the Trading Vehicle’s allocated assets determined as of the close of business on the last day of each month. For purposes of determining the management fee, any distributions, redemptions or reallocation of assets made as of the last day of each month were added back to the assets and there was no reduction for (i) the management fees calculated or (ii) any accrued but unpaid incentive fees due the Trading Advisor.

Additionally, the Trading Vehicle paid the Trading Advisor an incentive fee of 20% (the “Incentive Fee”) of “New High Net Trading Profits” (as defined in the Advisory Agreement). The incentive fee accrued monthly and was paid quarterly. For the period January 1, 2007 to April 30, 2007 (Date of Liquidation) and for the year ended December 31, 2006, the Trading Advisor earned incentive fees of $0 and $237,915, respectively.

Note 4. OPERATING EXPENSES

Operating expenses of the Trading Vehicle were paid for by the Trading Vehicle.

Note 5. DEPOSITS WITH BROKER

The Trading Vehicle deposited funds with UBS Securities LLC to act as broker subject to CFTC regulations and various exchange and broker requirements. Margin requirements were satisfied by the deposit of cash with such broker. The Trading Vehicle earned interest income on assets deposited with the broker at competitive rates.

Note 6. ADDITIONS, DISTRIBUTIONS AND REDEMPTIONS

The Trading Vehicle was not required to make distributions, but was permitted to do so at the discretion of the Members. A Member could request and receive redemption of capital at any time, subject to the terms in the Organization Agreement.

Note 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS

The Trading Vehicle was exposed to various types of risks associated with the derivative instruments and related markets in which it invested. These risks included, but were not limited to, risk of loss from fluctuations in the value of derivative instruments held (market risk) and the inability of counterparties to perform under the terms of the Trading Vehicle’s investment activities (credit risk).

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WMT III SERIES H/J TRADING VEHICLE LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Note 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)

Market Risk

Trading in futures contracts (including foreign exchange) involves entering into contractual commitments to purchase or sell a particular commodity at a specified date and price. The gross or face amount of the contracts, which is typically many times that of the Trading Vehicle’s net assets being traded, significantly exceeded the Trading Vehicle’s future cash requirements since the Trading Vehicle closed out its open positions prior to settlement. As a result, the Trading Vehicle was generally subject only to the risk of loss arising from the change in the value of the contracts. As such, the Trading Vehicles considered the “fair value” of its derivative instruments to be the net unrealized gain or loss on the contracts. The market risk associated with the Trading Vehicle’s commitments to purchase commodities was limited to the gross or face amount of the contract held. However, when the Trading Vehicle entered into a contractual commitment to sell commodities, it was obligated to make delivery of the underlying commodity at the contract price and then repurchase the contract at prevailing market prices or settle in cash. Since the repurchase price to which a commodity can rise is unlimited, entering into commitments to sell commodities exposed the Trading Vehicle to unlimited risk.

Market risk is influenced by a wide variety of factors, including government programs and policies, political and economic events, the level and volatility of interest rates, foreign currency exchange rates, the diversification effect among the derivative instruments the Trading Vehicle held and the liquidity and inherent volatility of the markets in which the Trading Vehicle traded.

Credit Risk

When entering into futures contracts, the Trading Vehicle was exposed to credit risk that the counterparty to the contract will not meet its obligations. The counterparty for futures contracts traded on United States and most foreign futures exchanges is the clearinghouse associated with the particular exchange. In general, a clearinghouse is backed by its corporate members who are required to share any financial burden resulting from the non-performance by one of their members and, as such, should significantly reduce this credit risk. In cases where the clearinghouse is not backed by the clearing members (i.e., some foreign exchanges), it is normally backed by a consortium of banks or other financial institutions. The amount at risk associated with counterparty non-performance of all of the Trading Vehicle’s contracts was the net unrealized gain included in the statement of financial condition; however, counterparty non-performance on only certain of the Trading Vehicle’s contracts might have resulted in a greater loss than non-performance on all of the Trading Vehicle’s contracts. There can be no assurance that any counterparty, clearing member or clearinghouse can meet its obligations to the Trading Vehicle.

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WMT III SERIES H/J TRADING VEHICLE LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Note 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)

Credit Risk (Continued)

The Managing Owner attempted to minimize both credit and market risks by requiring the Trading Vehicle and its Trading Advisor to abide by various trading limitations and policies. Preferred monitored compliance with these trading limitations and policies, which included, but was not limited to, executing and clearing all trades with creditworthy counterparties; limiting the amount of margin or premium required for any one commodity or all commodities combined; and generally limiting transactions to contracts which are traded in sufficient volume to permit the taking and liquidating of positions. Additionally, pursuant to the Advisory Agreement among the Trading Vehicle, Preferred and the Trading Advisor, the Trading Vehicle would have automatically terminated the Advisory Agreement, if the net asset value allocated to the Trading Advisor declined as of the end of any business day by at least 40% from the value at the beginning of any calendar year or since the effective date of the Advisory Agreement. The decline in net asset value was after giving effect for distributions, subscriptions and redemptions.

The Trading Vehicle’s futures commission merchant, in accepting orders for the purchase or sale of domestic futures contracts, is required by CFTC regulations to separately account for and segregate as belonging to the Trading Vehicle all assets of the Trading Vehicle relating to domestic futures trading and is not allowed to commingle such assets with its other assets. At April 30, 2007 (date of liquidation) and December 31, 2006, such segregated assets totaled $19,495,157 and $23,649,869, respectively. Part 30.7 of the CFTC regulations also requires the Trading Vehicle’s futures commission merchant to secure assets of the Trading Vehicle related to foreign futures trading which totaled $(124) and $136,650 at April 30, 2007 (date of liquidation) and December 31, 2006, respectively.

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WMT III SERIES H/J TRADING VEHICLE LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Note 8. FINANCIAL HIGHLIGHTS

The following information presents the financial highlights of the Trading Vehicle for the period January 1, 2007 to April 30, 2007 (Date of Liquidation) and for the year ended December 31, 2006. This information has been derived from information presented in the financial statements.


	Period January 1, 2007 to April 30, 2007 (Date of Liquidation)		Year Ended December 31, 2006
Total Return ⁽¹⁾
Total return before incentive fee	(0.83	)%	(1.41	)%
Incentive fee	0.00	%	(1.16	)%

Total return after incentive fee	(0.83	)%	(2.57	)%


Ratios to average net asset value:
Expenses prior to incentive fee ⁽²⁾	3.97	%	3.80	%
Incentive fee ⁽¹⁾	0.00	%	1.17	%

Total expenses and incentive fee	3.97	%	4.97	%


Net investment gain ^(2),(3)	0.62	%	0.73	%

Total returns and ratios to average net asset value are calculated for Members’ capital taken as a whole. An individual Member’s total return and ratios may vary from the above return and ratios based on the timing of additions and redemptions.

(1)

Not annualized

(2)

Annualized

(3)

Represents interest income less total expenses (exclusive of incentive fee).

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on the 27^th day of March, 2009.


	FUTURES STRATEGIC TRUST

By:	Preferred Investment Solutions Corp.
	Managing Owner

By:	/s/ David K. Spohr	Date: March 27, 2009
	David K. Spohr
	Senior Vice President and Director of Fund Administration

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Registrant in the capacities indicated on March 27, 2009.


	FUTURES STRATEGIC TRUST

By:	Preferred Investment Solutions Corp.
	Managing Owner

By:	/s/ Kenneth A. Shewer	Date: March 27, 2009
	Kenneth A. Shewer
	Co-Chief Executive Officer
	(Principal Executive Officer)

By:	/s/ David K. Spohr	Date: March 27, 2009
	David K. Spohr
	Senior Vice President and Director of Fund Administration
	(Principal Financial/Accounting Officer)

OTHER INFORMATION

The actual round-turn equivalent of brokerage commissions paid per contract for the year ended December 31, 2008 was $3.40.

The Trust’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission is available to unitholders without charge upon written request to:

Futures Strategic Trust

c/o Preferred Investment Solutions Corp

900 King Street, Suite 100

Rye Brook, NY 10573

Filing Compare · FUTURES STRATEGIC TRUST