UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 30, 2017

OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 000-26338

MORGAN STANLEY SMITH BARNEY SPECTRUM TECHNICAL L.P.

(Exact name of registrant as specified in its charter)

Delaware	13-3782231	~~13-3782231~~
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

c/o Ceres Managed Futures LLC

522 Fifth Avenue

New York, New York 10036

(Address of principal executive offices) (Zip Code)

(855) 672-4468

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes X No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	Accelerated filer	Non-accelerated filer X
Smaller reporting company	Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes No X

As of ~~July~~October 31, 2017, 32,~~040~~888,~~454~~904.~~411~~450 Limited Partnership Units were outstanding.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Statements of Financial Condition

	June 30,2017(Unaudited)		December 31,2016
	September 30,		December 31,
	2017		2016
	(Unaudited)
Assets:
Investment in SECOR Master Fund (1), at fair value	$	1917,~~192~~011,~~483~~812	$	19,624,189
Equity in trading account:
Unrestricted cash		3127,~~058~~563,~~572~~938		38,804,219
Restricted cash		65,~~150~~806,~~071~~060		6,959,456
Net unrealized appreciation on open futures contracts		-203,476		294,434
Total equity in trading account		3733,~~208~~573,~~643~~474		46,058,109
Cash at bank		~~825~~631		217
Interest receivable		30,~~421~~029		14,714
Total assets	$	5650,~~432~~615,~~372~~946	$	65,697,229
Liabilities and Partners’ Capital:
Liabilities:
Net unrealized depreciation on open futures contracts	$	1,340,531	$	-
Net unrealized depreciation on open forward contracts	$	417,593	$	64,550
Net unrealized depreciation on open forward contracts		44,935		64,550
Accrued expenses:
Ongoing placement agent fees		9587,~~454~~641		108,663
General Partner fees		9587,~~454~~641		108,663
Management fees		7266,~~524~~442		82,187
Redemptions payable to General Partner		-		125,000
Redemptions payable to Limited Partners		1779,~~154,485~~280		2,337,625
Total liabilities		21,~~803~~438,~~383~~597		2,826,688
Partners’ Capital:
General Partner, 37,652.383 and 39,044.365 Units outstanding atJune 30, 2017 and December 31, 2016, respectively		646,758		686,707
General Partner, 37,652.383 and 39,044.365 Units outstanding at September 30, 2017 and December 31, 2016, respectively		622,588		686,707
Limited Partners, 3,084,469.156 and 3,535,764.033 Units outstanding atJune 30, 2017 and December 31, 2016, respectively		52,982,231		62,183,834
Limited Partners, 2,936,471.164 and 3,535,764.033 Units outstanding at September 30, 2017 and December 31, 2016, respectively		48,554,761		62,183,834
Total partners’ capital (net asset value)		5349,~~628~~177,~~989~~349		62,870,541
Total liabilities and partners’ capital	$	5650,~~432~~615,~~372~~946	$	65,697,229
Net asset value per Unit	$	1716.1854	$	17.59

⁽¹⁾ Defined in Note 1.

See accompanying notes to these financial statements.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Condensed Schedule of Investments

~~June~~ September 30, 2017

(Unaudited)

	Notional ($)/Number of Contracts		Fair Value			% of Partners’Capital
	Notional ($)/ Number ofContracts		Fair Value			% of Partners’ Capital
Futures Contracts Purchased
Commodity		63138	$	~~310~~52,039			0.0011	%*	%
Equity		~~460~~438		~~(407,~~522,568	)		(01.7606	)
Currencies		4049		8(60,~~554~~464	)		(0.0212	)
Interest rates		1,~~339~~226		(~~784~~471,~~839~~528	)		(10.4696	)
Total futures contracts purchased				(142,~~183,497~~615	)		(20.2009	)
Futures Contracts Sold
Commodity		~~466~~215		~~(185~~29,~~166~~182	)		(0.3506	)
Equity		3526		112,~~357~~464			0.0003	*
Currencies		662		(932,~~287~~880	)		(0.0206	)
Interest rates		78336		3686,~~062~~335			0.0717
Total futures contracts sold				~~(157~~160,~~034~~861	)		(0.3032	)
Net unrealized depreciation on open futures contracts			$	(1,340,531	)		(2.50	) %
Net unrealized appreciation on open futures contracts			$	203,476			0.41		%
Unrealized Appreciation on Open Forward Contracts
Commodity		3226	$	7820,~~130~~068			0.1504	%	%
Currencies	$	3824,~~142~~283,~~787~~891		~~497~~308,~~708~~041			0.9363
Total unrealized appreciation on open forward contracts				~~575~~328,~~838~~109			10.0867
Unrealized Depreciation on Open Forward Contracts
Commodity		4626		(81149,~~845~~043	)		(0.1530	)
Currencies	$	2936,~~842~~908,~~188~~221		(~~538~~596,~~928~~659	)		(1.0122	)
Total unrealized depreciation on open forward contracts				(~~620~~745,~~773~~702	)		(1.1652	)
Net unrealized depreciation on open forward contracts			$	(44417,~~935~~593	)		(0.0885	) %	%

* Due to rounding.

See accompanying notes to these financial statements.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Condensed Schedule of Investments

December 31, 2016

	Notional ($)/Number of Contracts		Fair Value			% of Partners’Capital
	Notional ($)/ Number ofContracts		Fair Value			% of Partners’ Capital
Futures Contracts Purchased
Commodity		174	$	(15,541	)		(0.02	)%	%
Equity		472		213,149			0.34
Currencies		90		(77,975	)		(0.12	)
Interest rates		1,230		104,180			0.16
Total futures contracts purchased				223,813			0.36
Futures Contracts Sold
Commodity		239		112,739			0.18
Equity		100		(4,886	)		(0.01	)
Currencies		116		(42,388	)		(0.07	)
Interest rates		851		5,156			0.01
Total futures contracts sold				70,621			0.11
Net unrealized appreciation on open futures contracts			$	294,434			0.47	%	%
Unrealized Appreciation on Open Forward Contracts
Commodity		26	$	58,919			0.09	%	%
Currencies	$	42,090,719		606,892			0.97
Total unrealized appreciation on open forward contracts				665,811			1.06
Unrealized Depreciation on Open Forward Contracts
Commodity		68		(293,032	)		(0.47	)
Currencies	$	30,260,348		(437,329	)		(0.69	)
Total unrealized depreciation on open forward contracts				(730,361	)		(1.16	)
Net unrealized depreciation on open forward contracts			$	(64,550	)		(0.10	)%	%

See accompanying notes to these financial statements.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Statements of Income and Expenses

(Unaudited)

	Three Months EndedJune 30,						Six Months EndedJune 30,
	Three Months EndedSeptember 30,						Nine Months EndedSeptember 30,
	2017			2016			2017			2016
Investment Income:
Interest income	$	8699,~~198~~891		$	3335,~~381~~959		$	~~149~~249,~~447~~338		$	77113,~~358~~317
Expenses:
Ongoing placement agent fees		~~288~~264,~~266~~261			~~409~~391,~~193~~533			~~596~~860,~~426~~687			~~868~~1,~~856~~260,389
General Partner fees		~~288~~264,~~266~~261			~~409~~391,~~193~~533			~~596~~860,~~426~~687			~~868~~1,~~856~~260,389
Management fees		~~218~~200,~~212~~562			~~324~~296,~~789~~059			~~451~~651,~~082~~644			~~688~~984,~~045~~104
Incentive fees		-			-60,885			-			~~208~~269,~~244~~129
Total expenses		~~794~~729,~~744~~084			1,~~143~~140,~~175~~010			12,~~643~~373,~~934~~018			23,~~634~~774,~~001~~011
Net investment loss		(~~708~~629,~~546~~193	)		(1,~~109~~104,~~794~~051	)		(12,~~494~~123,~~487~~680	)		(23,~~556~~660,~~643~~694	)
Trading Results:
Net gains (losses) on trading of commodity interests and investment in SECOR Master Fund:
Net realized gains (losses) on closed contracts		~~394~~(864,~~525~~766	)		(31,~~336~~274,~~506~~049	)		1224,~~089,487~~721			(21,~~530~~256,~~791~~742	)
Net realized gains (losses) on closed contracts allocated from SECOR Master Fund		1(2,~~595~~160,~~798~~543	)		(12,~~287~~145,~~753~~861	)		1(428,~~732,410~~133	)		(1818,~~327,419~~442	)
Net change in unrealized gains (losses) on open contracts		(1,~~490~~172,~~549~~279	)		(1,~~994~~241,~~544~~281	)		(1442,~~615,055~~776	)		21,~~520~~279,~~350~~069
Net change in unrealized gains (losses) on open contracts allocated from SECOR Master Fund		~~(658~~548,~~342~~193	)		~~812~~(860,~~357~~494	)		(~~995~~447,~~977~~784	)		1639,~~499,581~~087
Total trading results		(~~158~~1,~~568~~304,837	)		(1,~~817~~318,~~358~~135	)		~~210~~(1,~~865~~093,972	)		~~161~~1,~~721~~479,856
Net income (loss)	$	(~~867~~1,~~114~~934,030	)	$	(2214,~~927,152~~084	)	$	(13,~~283~~217,~~622~~652	)	$	(2,~~394~~180,~~922~~838	)
Net income (loss) per Unit*	$	(0.2864	)	$	(0.6305	)	$	(01.4105	)	$	(0.5348	)
Weighted average number of Units outstanding		3,~~255~~073,~~184~~822.~~262~~259			4,~~463~~223,~~122~~442.~~786~~515			3,~~377~~276,~~801~~475.~~755~~256			4,~~585~~464,~~200~~614.~~646~~603

* Represents the change in net asset value per Unit during the period.

See accompanying notes to these financial statements.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Statements of Changes in Partners’ Capital

For the ~~Six~~Nine Months Ended ~~June~~ September 30, 2017 and 2016

(Unaudited)

	Units ofPartnershipInterest			LimitedPartners			GeneralPartner			Total
Partners’ Capital, December 31, 2016		3,574,808.398		$	62,183,834		$	686,707		$	62,870,541
Net income (loss)		-			(1,268,673	)		(14,949	)		(1,283,622	)
Redemptions - Limited Partners		(451,294.877	)		(7,932,930	)		-			(7,932,930	)
Redemptions - General Partner		(1,391.982	)		-			(25,000	)		(25,000	)
Partners’ Capital, June 30, 2017		3,122,121.539		$	52,982,231		$	646,758		$	53,628,989
Redemptions - Limited Partners		(599,292.869	)		(10,450,540	)		-			(10,450,540	)
Net income (loss)		-			(3,178,533	)		(39,119	)		(3,217,652	)
Partners’ Capital, September 30, 2017		2,974,123.547		$	48,554,761		$	622,588		$	49,177,349
Partners’ Capital, December 31, 2015		4,768,388.506		$	89,337,807		$	1,046,114		$	90,383,921
Net income (loss)		-			(2,374,104	)		(20,818	)		(2,394,922	)
Redemptions - Limited Partners		(460,218.618	)		(8,634,466	)		-			(8,634,466	)
Redemptions - General Partner		(9,039.202	)		-			(175,273	)		(175,273	)
Partners’ Capital, June 30, 2016		4,299,130.686		$	78,329,237		$	850,023		$	79,179,260
Redemptions - Limited Partners		(790,651.779	)		(14,742,836	)		-			(14,742,836	)
Net income (loss)		-			(2,162,250	)		(18,588	)		(2,180,838	)
Partners’ Capital, September 30, 2016		3,968,697.525		$	72,432,721		$	852,253		$	73,284,974

See accompanying notes to these financial statements.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

1.	Organization:

Morgan Stanley Smith Barney Spectrum Technical L.P. (the “Partnership”) is a Delaware limited partnership organized in 1994 to engage primarily in the speculative trading of futures contracts, options on futures and forward contracts, and forward contracts on physical commodities and other commodity interests, including, but not limited to, foreign currencies, financial instruments, metals, energy, and agricultural products (collectively, “Futures Interests”) (refer to Note 4, “Financial Instruments”). The General Partner (as defined below) may also determine to invest up to all of the Partnership’s assets in United States (“U.S.”) Treasury bills and/or money market mutual funds, including money market mutual funds managed by Morgan Stanley or its affiliates. The Partnership is one of the Morgan Stanley Spectrum series of funds, comprised of the Partnership, Ceres Tactical Currency L.P. (formerly, Morgan Stanley Smith Barney Spectrum Currency and Commodity L.P.), Morgan Stanley Smith Barney Spectrum Strategic L.P. and Morgan Stanley Smith Barney Spectrum Select L.P.

Ceres Managed Futures LLC, a Delaware limited liability company, acts as the general partner (“Ceres” or the “General Partner”) and commodity pool operator of the Partnership. As of January 1, 2017, Ceres became a wholly-owned subsidiary of Morgan Stanley Domestic Holdings, Inc. (“MSD Holdings”). MSD Holdings is ultimately owned by Morgan Stanley. Morgan Stanley is a publicly held company whose shares are listed on the New York Stock Exchange. Morgan Stanley is engaged in various financial services and other businesses. Prior to January 1, 2017, the General Partner was a wholly-owned subsidiary of Morgan Stanley Smith Barney Holdings LLC.

During the reporting periods ended ~~June~~September 30, 2017 and 2016, the Partnership’s commodity broker was Morgan Stanley & Co. LLC (“MS&Co.”), a registered futures commission merchant. MS&Co. also acts as the counterparty on all trading of of foreign currency forward contracts. Morgan Stanley Smith Barney LLC, doing business as Morgan Stanley Wealth Management (“Morgan Stanley Wealth Management”) is a principal subsidiary of MSD Holdings. MS&Co. and its affiliates act as the custodians of the Partnership’s assets available for trading in Futures Interests. MS&Co. is a wholly-owned subsidiary of Morgan Stanley. JP Morgan Chase Bank, N.A. (“JPMorgan”) may also act as a foreign exchange forward or swap counterparty for SECOR Master Fund (as defined below). The Partnership also deposits a portion of its cash in a non-trading account at JPMorgan ~~Chase Bank, N~~.A. The trading advisors to the Partnership are Campbell & Company, Inc. (“Campbell”), Aspect Capital Limited (“Aspect”), Secor Capital Advisors, L.P. (“SECOR”) and FORT, L.P. (“FORT”). Prior to March 31, 2016, Winton Capital Management Limited (“Winton” and together with Campbell, Aspect and SECOR, each, individually, a “Trading Advisor” or collectively, the “Trading Advisors”), respectively, were also trading advisors to the Partnership.

Effective June 1, 2016, the Partnership entered into a management agreement by and among the Partnership, the General Partner, and FORT, pursuant to which FORT will serve as a trading advisor to the Partnership and will manage the portion of the Partnership’s assets allocated to it. Effective July 1, 2016, a portion of the Partnership’s assets were allocated to FORT and traded pursuant to the Global Contrarian Program.

Effective March 31, 2016, ~~Ceres~~the ~~terminated~~General Partner terminated the management agreement with Winton pursuant to which Winton ceased trading the assets of the Partnership, fully liquidated all commodity interest positions in the Partnership, and converted all currency balances in the Partnership to U.S. dollars.

~~Ceres~~Effective January 1, ~~SECOR~~2015, ~~and~~ the Partnership entered into a management agreement ~~pursuant~~by toand ~~which~~among the Partnership, asthe ofGeneral ~~January 1~~Partner, ~~2015~~and SECOR, pursuant to which SECOR serves as a trading advisor to the Partnership and trades its allocated portion of the Partnership’s net assets through the Partnership’s investment in SECOR Master Fund L.P. (“SECOR Master Fund”), a limited partnership organized under the partnership laws of the State of Delaware, pursuant to the SECOR Alpha Program. Ceres is also the general partner of SECOR Master Fund.

In July 2015, the General Partner delegated certain administrative functions to SS&C Technologies, Inc., a Delaware corporation, currently doing business as SS&C GlobeOp (the “Administrator”). Pursuant to a master services agreement, the Administrator furnishes certain administrative, accounting, regulatory reporting, tax and other services as agreed from time to time. In addition, the Administrator maintains certain books and records of the Partnership. The General Partner pays or reimburses the Partnership, from the General Partner fee it receives from the Partnership, the ordinary administrative expenses of the Partnership. This includes the expenses related to the engagement of the Administrator. Therefore, the engagement of the Administrator did not impact the Partnership’s break-even point.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

2.	Basis of Presentation and Summary of Significant Accounting Policies:

The accompanying financial statements and accompanying notes are unaudited but, in the opinion of the General Partner, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Partnership’s financial condition at ~~June~~September 30, 2017, the results of its operations for the three and ~~six~~nine months ended ~~June~~ September 30, 2017 and 2016 and the changes in partners’ capital for the ~~six~~nine months ended ~~June~~September 30, 2017 and 2016. These financial statements present the results of interim periods and do not include all disclosures normally provided in annual financial statements. These financial statements should be read together with the financial statements and notes included in the Partnership’s Annual Report on Form 10-K (the “Form 10-K”) filed with the Securities and Exchange Commission (the “SEC”) for the year ended December 31, 2016. The December 31, 2016 information has been derived from the audited financial statements as of and for the year ended December 31, 2016.

Due to the nature of commodity trading, the results of operations for the interim periods presented should not be considered indicative of the results that may be expected for the entire year.

Use of Estimates. The preparation of financial statements and accompanying notes in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the General Partner to make estimates and assumptions that affect the reported amounts of assets and liabilities, income and expenses, and related disclosures of contingent assets and liabilities in the financial statements and accompanying notes. As a result, actual results could differ from these estimates, and those differences could be material.

Profit Allocation. The General Partner and each limited partner of the Partnership share in the profits and losses of the Partnership in proportion to the amount of Partnership interest owned by each except that no limited partner is liable for obligations of the Partnership in excess of its capital contributions and profits, if any, net of distributions, redemptions and losses, if any.

Statement of Cash Flows. The Partnership has not provided a Statement of Cash Flows, as permitted by Accounting Standards Codification (“ASC”) 230, “Statement of Cash Flows.” The Statements of Changes in Partners’ Capital is included herein, and as of and for the periods ended ~~June~~ September 30, 2017 and 2016, the Partnership carried no debt and substantially all the Partnership’s and SECOR Master Fund’s investments were carried at fair value and classified as Level 1 and Level 2 measurements.

Partnership’s/SECOR Master Fund’s Investments. All Futures Interests of the Partnership/SECOR Master Fund, including derivative financial instruments and derivative commodity instruments, are held for trading purposes. The Futures Interests are recorded on trade date and open contracts are recorded at fair value (as described in Note 6, “Fair Value Measurements”) at the measurement date. Investments in Futures Interests denominated in foreign currencies are translated into U.S. dollars at the exchange rates prevailing at the measurement date. Gains or losses are realized when contracts are liquidated and are determined using the first-in, first-out method. Unrealized gains or losses on open contracts are included as a component of equity in trading account in the Partnership’s/SECOR Master Fund’s Statements of Financial Condition. Net realized gains or losses and net change in unrealized gains or losses are included in the Partnership’s/SECOR Master Fund’s Statements of Income and Expenses.

The Partnership carries its investment in SECOR Master Fund at fair value based on its proportionate interest in SECOR Master Fund’s net asset value as calculated by SECOR Master Fund.

The Partnership and SECOR Master Fund do not isolate the portion of the results of operations arising from the effect of changes in foreign exchange rates on investments from fluctuations due to changes in market prices of investments held. Such fluctuations are included in total trading results in the Partnership’s/SECOR Master Fund’s Statements of Income and Expenses.

Restricted and Unrestricted Cash. The cash held by the Partnership available for trading in Futures Interests, if any, is on deposit in commodity brokerage accounts with MS&Co. As reflected in the Statements of Financial Condition, restricted cash equals the cash portion of assets on deposit to meet margin requirements, as determined by the exchange or counterparty, and required by MS&Co. All of these amounts are maintained separately. At ~~June~~September 30, 2017 and December 31, 2016, the amount of cash held for margin requirements was $65,~~150~~806,~~071~~060 and $6,959,456, respectively. Cash that is not classified as restricted cash is therefore classified as unrestricted cash. Restricted and unrestricted cash includes cash denominated in foreign currencies of $(~~165~~90,~~316~~455) (proceeds of $~~164~~91,~~938~~007) and $(205,801) (proceeds of $205,128) as of ~~June~~ September 30, 2017 and December 31, 2016, respectively.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

Income Taxes. Income taxes have not been listed as each partner is individually liable for the taxes, if any, on its share of the Partnership’s income and expenses. The Partnership follows the guidance of ASC 740, “Income Taxes,” which prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of tax positions taken or expected to be taken in the course of preparing the Partnership’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained “when challenged” or “when examined” by the applicable tax authority. Tax positions determined not to meet the more-likely-than-not threshold would be recorded as a tax benefit or liability in the Partnership’s Statements of Financial Condition for the current year. If a tax position does not meet the minimum statutory threshold to avoid the incurring of penalties, an expense for the amount of the statutory penalty and interest, if applicable, shall be recognized in the Statements of Income and Expenses in the period in which the position is claimed or expected to be claimed. The General Partner has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. The Partnership files U.S. federal and various state and local tax returns. No income tax returns are currently under examination. The 2013 through 2016 tax years remain subject to examination by U.S. federal and most state tax authorities.

Investment Company Status. Effective January 1, 2014, the Partnership adopted Accounting Standards Update 2013-08, “Financial Services — Investment Companies (Topic 946): Amendments to the Scope, Measurement and Disclosure Requirements” and based on the General Partner’s assessment, the Partnership has been deemed to be an investment company since inception. Accordingly, the Partnership follows the investment company accounting and reporting guidance of Topic 946 and reflects its investments at fair value with unrealized gains and losses resulting from changes in fair value reflected in the Statements of Income and Expenses.

Income Taxes. Income taxes have not been recorded as each partner is individually liable for the taxes, if any, on its share of the Partnership’s income and expenses. The Partnership follows the guidance of ASC 740, “Income Taxes,” which prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of tax positions taken or expected to be taken in the course of preparing the Partnership’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained “when challenged” or “when examined” by the applicable tax authority. Tax positions determined not to meet the more-likely-than-not threshold would be recorded as a tax benefit or liability in the Partnership’s Statements of Financial Condition for the current year. If a tax position does not meet the minimum statutory threshold to avoid the incurring of penalties, an expense for the amount of the statutory penalty and interest, if applicable, shall be recognized in the Statements of Income and Expenses in the period in which the position is claimed or expected to be claimed. The General Partner has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. The Partnership files U.S. federal and various state and local tax returns. No income tax returns are currently under examination. The 2013 through 2016 tax years remain subject to examination by U.S. federal and most state tax authorities.

Net Income (Loss) per Unit. Net income (loss) per unit of limited partnership interest (“Unit(s)”) is calculated in accordance with ASC 946, “Financial Services – Investment Companies.” See Note 3, “Financial Highlights.”

There have been no material changes with respect to the Partnership’s critical accounting policies as reported in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2016.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

3.	Financial Highlights:

Financial highlights for the limited partner class as a whole for the three and ~~six~~nine months ended ~~June~~September 30, 2017 and ~~2016~~ 2016 were as follows:

	Three MonthsEnded June 30,							Six Months EndedJune 30,
	Three Months EndedSeptember 30,												Nine Months EndedSeptember 30,
	2017			~~2016~~		2016		~~2017~~			~~2016~~		2017				2016
Per Unit Performance (for a unit outstanding throughout the period): *
Net realized and unrealized gains (losses)	$	(0.0644	)	$	~~(0.38~~	)$	0.31	$	~~0.03~~		$	~~0.03~~	$	(0.40	)		$	0.34
Net investment loss		(0.2220	)		~~(0.25~~	)	(0.26	)	~~(0.44~~	)		~~(0.56~~	)	(0.65	)			(0.82	)
Net increase (decrease) for the period		(0.2864	)		~~(0.63~~	)	0.05		~~(0.41~~	)		~~(0.53~~	)	(1.05	)			(0.48	)
Net asset value per Unit, beginning of period		17.4618			~~19.05~~		18.42		~~17.59~~			~~18.95~~		17.59				18.95
Net asset value per Unit, end of period	$	1716.1854		$	~~18.42~~	$	18.47	$	~~17.18~~		$	~~18.42~~	$	16.54			$	18.47
	Three Months EndedJune 30,							Six Months EndedJune 30,
	Three Months EndedSeptember 30,												Nine Months EndedSeptember 30,
	2017			~~2016~~		2016		~~2017~~			~~2016~~		2017				2016
Ratios to Average Limited Partners’ Capital: **
Net investment loss ***		(54.08	)%	%	~~(5.5~~	)%	(5.5	)	~~(5.1~~	)%		~~(5.7~~	)%	(5.0	)	%		(5.8	)	%
Operating expenses before incentive fees		5.6	%	%	~~5.7~~	%	5.6		~~5.6~~	%		~~5.7~~	%	5.6		%		5.6		%
Incentive fees		-	%	%	-	%	0.1		-	%		~~0.2~~	%	-		%		0.3		%
Operating expenses after incentive fees		5.6	%	%	~~5.7~~	%	5.7		~~5.6~~	%		~~5.9~~	%	5.6		%		5.9		%
Total return:
Total return before incentive fees		(13.67	)%	%	~~(3.3~~	)%	0.4		~~(2.3~~	)%		~~(2.6~~	)%	(6.0	)	%		(2.2	)	%
Incentive fees		-	%	%	-	%	(0.1	)	-	%		~~(0.2~~	)%	-		%		(0.3	)	%
Total return after incentive fees		(13.67	)%	%	~~(3.3~~	)%	0.3		~~(2.3~~	)%		~~(2.8~~	)%	(6.0	)	%		(2.5	)	%

Net investment loss per Unit is calculated by dividing the interest income less total expenses by the average number of Units outstanding during the period. The net realized and unrealized gains (losses) per Unit is a balancing amount necessary to reconcile the change in net asset value per Unit with the other per unit information.

**	Annualized (except for incentive fees, if applicable).

***	Interest income less total expenses.

The above ratios and total return may vary for individual investors based on the timing of capital transactions during the period. Additionally, these ratios are calculated for the limited partner class using the limited partners’ share of income, expenses and average partners’ capital and include income and expenses allocated from SECOR Master Fund.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

4.	Financial Instruments:

The Partnership and SECOR Master Fund trade Futures Interests. Futures and forwards represent contracts for delayed delivery of an instrument at a specified date and price. Futures Interests are open commitments until the settlement date, at which time they are realized. They are valued at fair value, generally on a daily basis, and the unrealized gains and losses on open contracts (the difference between contract trade price and market price) are reported in the Statements of Financial Condition as a net unrealized appreciation or depreciation on open futures contracts or net unrealized appreciation or depreciation on open forward contracts. The resulting net change in unrealized gains and losses is reflected in “Net change in unrealized gains (losses) on open contracts” and “Net change in unrealized gains (losses) on open contracts allocated from SECOR Master Fund” from one period to the next in the Statements of Income and Expenses. The Partnership’s contracts are accounted for on a trade-date basis. Risk arises from changes in the value of these contracts and the potential inability of counterparties to perform under the terms of the contracts. There are numerous factors which may significantly influence the fair value of these contracts, including interest rate volatility.

The fair value of an exchange-traded contract is based on the settlement price quoted by the exchange on the day with respect to which fair value is being determined. If an exchange-traded contract could not have been liquidated on such day due to the operation of daily limits or other rules of the exchange, the settlement price will be equal to the settlement price on the first subsequent day on which the contract could be liquidated.

The General Partner estimates that, at any given time, approximately 33.3% to 41.2% of the Partnership’s contracts are traded over-the-counter.

In general, the risks associated with non-exchange traded contracts are greater than those associated with exchange-traded contracts because of the greater risk of default by the counterparty to an non-exchange traded contract. The Partnership and SECOR Master Fund have credit risk associated with counterparty nonperformance. As of the date of the financial statements, the credit risk associated with the instruments in which the Partnership and SECOR Master Fund trade is limited to the unrealized gain (loss) amounts reflected in the Partnership’s/SECOR Master Fund’s Statements of Financial Condition. The net unrealized gains (losses) on open contracts are further disclosed gross by type of contract and corresponding fair value level in Note 6, “Fair Value Measurements.”

The Partnership also has credit risk because MS&Co. acts as the commodity futures broker, or the counterparty, with respect to most of the Partnership’s assets. Exchange-traded futures and exchange-traded forward contracts are fair valued on a daily basis, with variations in value settled on a daily basis. With respect to the Partnership’s non-exchange traded forward currency contracts and forward currency option contracts, there are no daily settlements of variation in value, nor is there any requirement that an amount equal to the net unrealized gains (losses) on such contracts be segregated. However, the Partnership is required to meet margin requirements equal to the net unrealized loss on open forward currency contracts in the Partnership’s accounts with the counterparty, which is accomplished by daily maintenance of the cash balance in a custody account held at MS&Co., for the benefit of MS&Co. With respect to those non-exchange traded forward currency contracts, the Partnership is at risk to the ability of MS&Co., the sole counterparty on all such contracts, to perform. The Partnership has a netting agreement with the counterparty. The primary terms are based on industry standard master netting agreements. This agreement, which seeks to reduce both the Partnership’s and the counterparty’s exposure on non-exchange traded forward currency contracts, should materially decrease the Partnership’s credit risk in the event of MS&Co.’s bankruptcy or insolvency.

The General Partner monitors and attempts to mitigate the Partnership’s risk exposure on a daily basis through financial, credit and risk management monitoring systems, and, accordingly, believes that it has effective procedures for evaluating and limiting the credit and market risks to which the Partnership may be subject. These monitoring systems generally allow the General Partner to statistically analyze actual trading results with risk adjusted performance indicators and correlation statistics. In addition, online monitoring systems provide account analysis of futures and forward contracts by sector, margin requirements, gain and loss transactions and collateral positions.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

The futures and forwards traded by the Partnership and SECOR Master Fund, along with U.S. Treasury bills held by the Partnership, involve varying degrees of related market risk. Market risk is often dependent upon changes in the level or volatility of interest rates, exchange rates, and prices of financial instruments and commodities, factors that result in frequent changes in the fair value of the Partnership’s open positions, and consequently in its earnings, whether realized or unrealized, and cash flow.

Gains and losses on open positions of exchange-traded futures and exchange-traded forward contracts are settled daily through variation margin. Gains and losses on non-exchange traded forward currency contracts are settled upon termination of the contract. Gains and losses on non-exchange traded forward currency option contracts are settled on an agreed-upon settlement date.

In the ordinary course of business, the Partnership and SECOR Master Fund enter into contracts and agreements that contain various representations and warranties and which provide general indemnifications. The Partnership’s and SECOR Master Fund’s maximum exposure under these arrangements cannot be determined, as this could include future claims that have not yet been made against the Partnership and SECOR Master Fund. The Partnership and SECOR Master Fund consider the risk of any future obligation relating to these indemnifications to be remote.

5.	Trading Activities:

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

All of the Futures Interests owned by the Partnership are held for trading purposes. The monthly average number of futures contracts traded during the three months ended ~~June~~September 30, 2017 and 2016 were 2,~~982~~476 and 23,~~525~~351, respectively. The monthly average number of futures contracts traded during the ~~six~~nine months ended ~~June~~September 30, 2017 and 2016 were 32,~~037~~850 and 2,~~734~~968, respectively. The monthly average number of metal forward contracts traded during the three months ended ~~June~~September 30, 2017 and 2016 were ~~174~~109 and ~~523~~322, respectively. The monthly average number of metal forward contracts traded during the nine ~~six~~ months ended ~~June~~September 30, 2017 and 2016 were ~~176~~154 and ~~498~~439, respectively. The monthly average notional values of currency forward contracts traded during the three months ended ~~June~~September 30, 2017 and 2016 were $~~140~~120,~~525~~662,~~137~~532 and $~~418~~243,~~763~~384,~~812~~213, respectively. The monthly average notional values of currency forward contracts traded during the ~~six~~nine months ended ~~June~~September 30, 2017 and 2016 were $~~133~~129,~~997~~552,~~687~~635 and $~~386~~338,~~433~~750,~~963~~713, respectively.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

The following tables summarize the gross and net amounts recognized relating to the assets and liabilities of the Partnership’s derivatives and their offsetting subject to master netting agreements or similar agreements as of ~~June~~September 30, 2017 and December 31, 2016, respectively.

	Gross AmountsRecognized			Gross AmountsOffset in theStatements ofFinancialCondition			AmountsPresented in theStatements ofFinancialCondition			Gross Amounts Not Offset in theStatements of Financial Condition				Net Amount
				Gross Amounts			Amounts			Gross Amounts Not Offset in the
										FinancialInstruments		Cash CollateralReceived/Pledged*
				Offset in the			Presented in the			Statements of Financial Condition
June 30, 2017
				Statements of			Statements of					Cash Collateral
	Gross Amounts			Financial			Financial			Financial		Received/
September 30, 2017	Recognized			Condition			Condition			Instruments		Pledged*		Net Amount
Assets
Futures	$	~~333~~960,~~157~~084		$	(~~333~~756,~~157~~608	)	$	-203,476		$	-	$	-	$	-203,476
Forwards		~~575~~328,~~838~~109			(~~575~~328,~~838~~109	)		-			-		-		-
Total assets	$	~~908~~1,~~995~~288,193		$	(~~908~~1,~~995~~084,717	)	$	-203,476		$	-	$	-	$	-203,476
Liabilities
Futures	$	(1756,~~673,688~~608	)	$	~~333~~756,~~157~~608		$	~~(1,340,531~~-	)	$	-	$	-	$	~~(1,340,531~~-	)
Forwards		(~~620~~745,~~773~~702	)		~~575~~328,~~838~~109			(44417,~~935~~593	)		-		-		(44417,~~935~~593	)
Total liabilities	$	(21,~~294~~502,~~461~~310	)	$	~~908~~1,~~995~~084,717		$	(1417,~~385,466~~593	)	$	-	$	-	$	(1417,~~385,466~~593	)
Net fair value														$	(1214,~~385,466~~117	) *
				Gross Amounts			Amounts			Gross Amounts Not Offset in the
				Offset in the			Presented in the			Statements of Financial Condition
				Statements of			Statements of					Cash Collateral
	Gross Amounts			Financial			Financial			Financial		Received/
December 31, 2016	Recognized			Condition			Condition			Instruments		Pledged*		NetAmount
Assets
Futures	$	1,051,049		$	(756,615	)	$	294,434		$	-	$	-	$	294,434
Forwards		665,811			(665,811	)		-			-		-		-
Total assets	$	1,716,860		$	(1,422,426	)	$	294,434		$	-	$	-	$	294,434
Liabilities
Futures	$	(756,615	)	$	756,615		$	-		$	-	$	-	$	-
Forwards		(730,361	)		665,811			(64,550	)		-		-		(64,550	)
Total liabilities	$	(1,486,976	)	$	1,422,426		$	(64,550	)	$	-	$	-	$	(64,550	)
Net fair value														$	229,884	*

December 31, 2016	Gross AmountsRecognized			Gross AmountsOffset in theStatements ofFinancialCondition			AmountsPresented in theStatements ofFinancialCondition			Gross Amounts Not Offset in theStatements of Financial Condition				Net Amount
										FinancialInstruments		Cash CollateralReceived/Pledged*
Assets
Futures	$	1,051,049		$	(756,615	)	$	294,434		$	-	$	-	$	294,434
Forwards		665,811			(665,811	)		-			-		-		-
Total assets	$	1,716,860		$	(1,422,426	)	$	294,434		$	-	$	-	$	294,434
Liabilities
Futures	$	(756,615	)	$	756,615		$	-		$	-	$	-	$	-
Forwards		(730,361	)		665,811			(64,550	)		-		-		(64,550	)
Total liabilities	$	(1,486,976	)	$	1,422,426		$	(64,550	)	$	-	$	-	$	(64,550	)
Net fair value														$	229,884	*

In the event of default by the Partnership, MS&Co., the Partnership’s commodity futures broker and the sole counterparty to the Partnership’s non-exchange traded contracts, as applicable, has the right to offset the Partnership’s obligation with the Partnership’s cash and/or U.S. Treasury bills held by MS&Co., thereby minimizing MS&Co.’s risk of loss. In certain instances, MS&Co. may not post collateral and as such, in the event of default by MS&Co., the Partnership is exposed to the amount shown in the Statements of Financial Condition. In the case of exchange-traded contracts, the Partnership’s exposure to counterparty risk may be reduced since the exchange’s clearinghouse interposes its credit between buyer and seller and the clearinghouse’s guarantee funds may be available in the event of a default.

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

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

The following tables indicate the gross fair values of derivative instruments of futures and forward contracts held by the Partnership as separate assets and liabilities as of ~~June~~September 30, 2017 and December 31, 2016, respectively.

	June 30, 2017
	September 30,2017
Assets
Futures Contracts
Commodity	$	~~187~~244,~~510~~827
Equity		38575,~~598~~558
Currencies		1734,~~160~~777
Interest rates		89104,~~889~~922
Total unrealized appreciation on open futures contracts		~~333~~960,~~157~~084
Liabilities
Futures Contracts
Commodity		(~~372~~163,~~366~~606	)
Equity		(~~444~~40,~~763~~526	)
Currencies		(1762,~~893~~361	)
Interest rates		(~~838~~490,~~666~~115	)
Total unrealized depreciation on open futures contracts		(1756,~~673,688~~608	)
Net unrealized depreciation on open futures contracts	$	(1,340,531	)*
Net unrealized appreciation on open futures contracts	$	203,476		*
Assets
Forward Contracts
Commodity	$	7820,~~130~~068
Currencies		~~497~~308,~~708~~041
Total unrealized appreciation on open forward contracts		~~575~~328,~~838~~109
Liabilities
Forward Contracts
Commodity		(81149,~~845~~043	)
Currencies		(~~538~~596,~~928~~659	)
Total unrealized depreciation on open forward contracts		(~~620~~745,~~773~~702	)
Net unrealized depreciation on open forward contracts	$	(44417,~~935~~593	)**	**

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

**	This amount is in “Net unrealized depreciation on open forward contracts” in the Partnership’s Statements of Financial Condition.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

	December 31, 2016
	December 31,2016
Assets
Futures Contracts
Commodity	$	323,692
Equity		348,618
Currencies		24,345
Interest rates		354,394
Total unrealized appreciation on open futures contracts		1,051,049
Liabilities
Futures Contracts
Commodity		(226,494	)
Equity		(140,355	)
Currencies		(144,708	)
Interest rates		(245,058	)
Total unrealized depreciation on open futures contracts		(756,615	)
Net unrealized appreciation on open futures contracts	$	294,434	*	*
Assets
Forward Contracts
Commodity	$	58,919
Currencies		606,892
Total unrealized appreciation on open forward contracts		665,811
Liabilities
Forward Contracts
Commodity		(293,032	)
Currencies		(437,329	)
Total unrealized depreciation on open forward contracts		(730,361	)
Net unrealized depreciation on open forward contracts	$	(64,550	)**	**

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

**	This amount is in “Net unrealized depreciation on open forward contracts” in the Partnership’s Statements of Financial Condition.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

The following tables indicate the Partnership’s trading gains and losses, by market sector, on derivative instruments for the three and ~~six~~nine months ended ~~June~~September 30, 2017 and 2016, respectively.

	Three Months Ended June 30,						Six Months Ended June 30,
	Three Months Ended												Nine Months Ended
Sector	2017			2016			2017			2016
	September 30,												September 30,
Commodity	$	(260,592	)	$	(1,398,071	)	$	(744,079	)	$	(1,982,676	)
Sector	2017						2016						2017				2016
Equity		1,784,202			(1,342,238	)		3,588,907			(1,102,455	)
Commodity	$	(489,643	)				$	(309,812	)				$	(1,233,722	)		$	(2,292,488	)
Currencies		(827,458	)		(591,439	)		(1,237,308	)		(871,063	)
Equity		(630,368	)					2,292,862						2,958,539				1,190,407
Interest rates		(854,720	)		1,514,390			(1,396,655	)		4,117,915
Currencies		(91,296	)					(38,341	)					(1,328,604	)			(909,404	)
Total	$	(158,568	)*	$	(1,817,358	)*	$	210,865	*	$	161,721	*
Interest rates		(93,530	)					(626,574	)					(1,490,185	)			3,491,341
Total	$	(1,304,837	)		*		$	1,318,135			*		$	(1,093,972	)	*	$	1,479,856		*

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

6.	Fair Value Measurements:

Fair value is defined as the value that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. The fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to fair values derived from unobservable inputs (Level 3). The level in the fair value hierarchy within which the fair value measurement in its entirety falls shall be determined based on the lowest level input that is significant to the fair value measurement in its entirety.

The fair value of exchange-traded futures, forward and option contracts is determined by the various exchanges, and reflects the settlement price for each contract as of the close of business on the last business day of the reporting period. The fair value of foreign currency forward contracts is extrapolated on a forward basis from the spot prices quoted as of approximately 3:00 P.M. (E.T.) on the last business day of the reporting period from various exchanges. The fair value of non-exchange-traded foreign currency option contracts is calculated by applying an industry standard model application for options valuation of foreign currency options, using as input the spot prices, interest rates and option implied volatilities quoted as of approximately 3:00 P.M. (E.T.) on the last business day of the reporting period. U.S. Treasury bills are valued at the last available bid price received from independent pricing services as of the close of the last business day of the reporting period.

The Partnership and SECOR Master Fund consider prices for exchange-traded commodity futures, forward, swap and option ~~contracts~~ contracts to be based on unadjusted quoted prices in active markets for identical assets and liabilities (Level 1). The values of U.S. Treasury bills, non-exchange-traded forward, swap and certain option contracts for which market quotations are not readily available are priced by pricing services that derive fair values for those assets and liabilities from observable inputs (Level 2). As of ~~June~~September 30, 2017 and December 31, 2016 and for the ~~periods~~ periods ended ~~June~~September 30, 2017 and 2016, the Partnership and SECOR Master Fund did not hold any derivative instruments that were priced at fair value using unobservable inputs through the application of the General Partner’s assumptions and internal valuation pricing models (Level 3). Transfers between levels are recognized at the end of the reporting period. During the reporting periods, there were no transfers of assets or liabilities between Level 1 and Level 2.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

June 30, 2017	Total		Level 1		Level 2		Level 3
September 30, 2017	Total		Level 1		Level 2		Level 3
Assets
Futures	$	~~333~~960,~~157~~084	$	~~333~~960,~~157~~084	$	-	$	-
Forwards		~~575~~328,~~838~~109		7820,~~130~~068		~~497~~308,~~708~~041		-
Total assets	$	~~908~~1,~~995~~288,193	$	~~411~~980,~~287~~152	$	~~497~~308,~~708~~041	$	-
Liabilities
Futures	$	1756,~~673,688~~608	$	1756,~~673,688~~608	$	-	$	-
Forwards		~~620~~745,~~773~~702		81149,~~845~~043		~~538~~596,~~928~~659		-
Total liabilities	$	21,~~294~~502,~~461~~310	$	1905,~~755,533~~651	$	~~538~~596,~~928~~659	$	-
December 31, 2016	Total		Level 1		Level 2		Level 3
Assets
Futures	$	1,051,049	$	1,051,049	$	-	$	-
Forwards		665,811		58,919		606,892		-
Total assets	$	1,716,860	$	1,109,968	$	606,892	$	-
Liabilities
Futures	$	756,615	$	756,615	$	-	$	-
Forwards		730,361		293,032		437,329		-
Total liabilities	$	1,486,976	$	1,049,647	$	437,329	$	-

7.	Investment in SECOR Master Fund:

On January 1, 2015, the Partnership invested a portion of its assets in SECOR Master Fund. SECOR Master Fund permits accounts managed by SECOR using a variation of the program traded by SECOR Alpha Master Fund L.P., a proprietary, systematic trading program, to invest together in one trading vehicle. Individual and pooled accounts currently managed by SECOR, including the Partnership, are permitted to be limited partners of SECOR Master Fund. The General Partner and SECOR believe that trading through this structure should promote efficiency and economy in the trading process.

Summarized information reflecting the total assets, liabilities and partners’ capital of SECOR Master Fund is shown in the following tables:

June 30, 2017

September 30, 2017

Total Assets

Total Liabilities

Total Partners’ Capital

SECOR Master Fund

3325,~~757~~872,~~737~~338

1729,~~653,435~~532

3225,~~104~~142,~~302~~806

December 31, 2016

Total Assets

Total Liabilities

Total Partners’ Capital

SECOR Master Fund

39,231,542

679,104

38,552,438

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

Summarized information reflecting the Partnership’s investment in and the operations of SECOR Master Fund is shown in the following tables:

June 30, 2017

For the three months ended June 30, 2017

September 30, 2017

For the three months ended September 30, 2017

% ofPartners’Capital

FairValue

Partnership’sPro-Rata Shareof Net Income

InvestmentObjective

RedemptionsPermitted

SECOR Master Fund

3534.86

1917,~~192~~011,~~483~~812

~~965~~(1,~~627~~577,537

)

Commodity Portfolio

~~Monthly~~

Monthly

June 30, 2017

For the six months ended June 30, 2017

September 30, 2017

For the nine months ended September 30, 2017

% ofPartners’Capital

FairValue

Partnership’sPro-Rata Shareof Net Income

InvestmentObjective

RedemptionsPermitted

SECOR Master Fund

3534.86

1917,~~192~~011,~~483~~812

~~783~~(793,~~976~~561

)

Commodity Portfolio

~~Monthly~~

Monthly

December 31, 2016

For the three months ended ~~June~~September 30, 2016

% ofPartners’Capital

FairValue

Partnership’sPro-Rata Shareof Net Loss

InvestmentObjective

RedemptionsPermitted

SECOR Master Fund

31.2

19,624,189

~~(464~~1,~~591~~297,082

)

Commodity Portfolio

~~Monthly~~

Monthly

December 31, 2016

For the ~~six~~nine months ended ~~June~~September 30, 2016

% ofPartners’Capital

FairValue

Partnership’sPro-Rata Shareof Net Income

InvestmentObjective

RedemptionsPermitted

SECOR Master Fund

31.2

19,624,189

~~197~~1,~~080~~494,162

Commodity Portfolio

~~Monthly~~

Monthly

SECOR Master Fund does not pay any management or incentive fees related to the Partnership’s investment in the fund. These fees are accrued and paid by the Partnership. The Partnership reimburses SECOR Master Fund for all brokerage related fees borne by SECOR Master Fund on behalf of the Partnership’s investment.

As of ~~June~~September 30, 2017 and December 31, 2016, the Partnership owned approximately 5967.86% and 50.9% of SECOR ~~Master~~ Master Fund, respectively. It is the Partnership’s intention to continue to invest in SECOR Master Fund. The performance of the Partnership is directly affected by the performance of SECOR Master Fund.

Morgan Stanley Smith Barney Spectrum Technical L.P.

Notes to Financial Statements

(Unaudited)

The tables below represent summarized Income Statement information for SECOR Master Fund for the three and ~~six~~nine months ended ~~June~~September 30, 2017 and 2016, respectively.

For the Three Months Ended June 30, 2017

InvestmentIncome

NetInvestment Loss

Total TradingResults

Net Income(Loss)

For the Three Months Ended September 30, 2017

InvestmentIncome

Net InvestmentIncome (Loss)

Total TradingResults

Net Income(Loss)

SECOR Master Fund

5359,~~786~~288

(38,~~651~~727

)

1(2,~~708~~449,~~773~~650

)

1(2,~~705~~440,~~122~~923

)

For the Six Months Ended June 30, 2017

InvestmentIncome

NetInvestment Loss

Total TradingResults

Net Income(Loss)

For the Nine Months Ended September 30, 2017

InvestmentIncome

Net InvestmentIncome (Loss)

Total TradingResults

Net Income(Loss)

SECOR Master Fund

93152,~~018~~306

(145,~~054~~327

)

(1,~~379~~070,~~449~~201

)

(1,~~365~~075,~~395~~528

)

For the Three Months Ended June 30, 2016

InvestmentIncome

NetInvestment Loss

Total TradingResults

Net Income(Loss)

For the Three Months Ended September 30, 2016

InvestmentIncome

Net InvestmentIncome (Loss)

Total TradingResults

Net Income(Loss)

SECOR Master Fund

1922,~~532~~992

(6750,~~063~~084

)

~~(820~~2,~~318~~380,570

)

~~(887~~2,~~381~~330,486

)

For the Six Months Ended June 30, 2016

InvestmentIncome

NetInvestment Loss

Total TradingResults

Net Income(Loss)

For the Nine Months Ended September 30, 2016

InvestmentIncome

Net InvestmentIncome (Loss)

Total TradingResults

Net Income(Loss)

SECOR Master Fund

4568,~~757~~749

(~~145~~195,~~724~~808

)

~~393~~2,~~562~~774,132

~~247~~2,~~838~~578,324

8.	Subsequent Events:

The General Partner evaluates events that occur after the balance sheet date but before and up until financial statements are issued. The General Partner has assessed the subsequent events through the date the financial statements were issued and has determined that, ~~other than the events listed below,~~ there were no subsequent events requiring adjustment to or disclosure in the financial statements.

On July 12, 2017, SECOR Master Fund and J.P. Morgan Securities LLC, JPMorgan Chase Bank, N.A., J.P. Morgan Securities plc, J.P. Morgan Securities (Asia Pacific) Limited, J.P. Morgan Securities Asia Private Limited, J.P. Morgan Securities Australia Limited, JPMorgan Securities Japan Co., Ltd., J.P. Morgan Prime Nominees Limited, J.P. Morgan Markets Limited and J.P. Morgan Prime Inc. (collectively, “J.P. Morgan”) entered into an institutional account agreement, dated as of July 12, 2017 (the “IAA”), pursuant to which J.P. Morgan will open and maintain one or more brokerage accounts for SECOR Master Fund (and, indirectly, the Partnership).

Pursuant to the IAA, SECOR Master Fund (through the Partnership) shall pay J.P. Morgan commissions and other fees for clearing, custody and any other services furnished.

The IAA may be terminated by either party at any time upon thirty days’ prior written notice to the other party.

On July 12, 2017, SECOR Master Fund, SECOR and JPMorgan Chase Bank, N.A. (“JPMorgan Chase”) entered into a foreign exchange and bullion authorization agreement, dated as of July 12, 2017 (the “FXBAA”), pursuant to which SECOR, the trading advisor to SECOR Master Fund (and, indirectly, the Partnership), is authorized to enter into certain transactions on behalf of SECOR Master Fund with JPMorgan Chase, or, upon authorization by JPMorgan Chase, with a dealer or other entity subject to the terms of the FXBAA, and any other applicable agreement, on behalf of JPMorgan Chase.

~~Morgan~~Item ~~Stanley~~2. ~~Smith~~Management’s ~~Barney~~Discussion ~~Spectrum~~and ~~Technical~~Analysis ~~L.P.~~of Financial Condition and Results of Operations.

~~Notes~~Liquidity toand ~~Financial~~Capital ~~Statements~~Resources

The Partnership does not have, nor does it expect to have, any capital assets. The Partnership does not engage in sales of goods or services. Its assets are its (~~Unaudited~~i) investment in SECOR Master Fund, (ii) equity in trading account, consisting of restricted and unrestricted cash, net unrealized appreciation on open futures contracts, net unrealized appreciation on open forward contracts, and investment in U.S. Treasury bills at fair value, if applicable, (iii) cash at bank and (iv) interest receivable. Because of the low margin deposits normally required in commodity futures trading, relatively small price movements may result in substantial losses to the Partnership, through its direct investments and investment in SECOR Master Fund. While substantial losses could lead to a material decrease in liquidity, no such illiquidity occurred in the third quarter of 2017.

~~Pursuant~~The Partnership’s/SECOR Master Fund’s investment in Futures Interests may, from time to time, be illiquid. Most U.S. futures exchanges limit fluctuations in prices during a single day by regulations referred to as “daily price fluctuation limits” or “daily limits.” Trades may not be executed at prices beyond the daily ~~FXBAA,~~limit. ~~SECOR~~If ~~Master~~the ~~Fund~~price ~~(through~~for ~~which~~a particular futures or option contract has increased or decreased by an amount equal to the ~~Partnership)~~daily ~~will~~limit, positions in that futures or option contract can neither be taken nor liquidated unless traders are willing to ~~pay~~effect ~~JPMorgan~~trades ~~Chase~~at ~~fees~~or ~~based~~within onthe limit. Futures prices have occasionally moved the ~~transactions~~daily ~~entered~~limit ~~into~~for byseveral ~~SECOR~~consecutive ~~Master~~days ~~Fund~~with ~~during~~little ~~each~~or ~~calculation~~no ~~period~~trading. These market conditions could prevent the Partnership from promptly liquidating its futures or option contracts and result in restrictions on redemptions.

~~The~~There is no limitation on daily price movements in trading ~~FXBAA~~forward ~~may~~contracts beon ~~terminated~~foreign bycurrencies. ~~either~~The ~~party~~markets atfor ~~any~~some ~~time~~world ~~upon~~currencies ~~thirty~~have ~~business~~low ~~days’~~trading ~~written~~volume ~~notice~~and toare illiquid, which may prevent the ~~other~~Partnership ~~party,~~from trading in potentially profitable markets or ~~immediately~~prevent the Partnership from promptly liquidating unfavorable positions in such ~~circumstances~~markets, assubjecting ~~set~~it ~~forth~~to substantial losses. Either of these market conditions could result in restrictions on redemptions. For the ~~FXBAA~~periods covered by this report, illiquidity has not materially affected the Partnership’s assets.

InOther ~~connection~~than ~~with~~ the ~~FXBAA,~~risks ~~on July 12,~~inherent ~~2017,~~in ~~SECOR~~Futures ~~Master~~Interests ~~Fund~~trading and ~~JPMorgan~~U.S. ~~Chase~~Treasury ~~also~~bills ~~entered into an~~and ~~International~~money ~~Swap~~market ~~Dealers~~mutual ~~Association~~fund securities, ~~Inc.~~the ~~Master~~Partnership ~~Agreement~~knows ~~(the~~of ~~“Master~~no ~~Agreement”)~~trends, ademands, ~~Schedule~~commitments, toevents ~~the~~or ~~ISDA~~uncertainties ~~Master~~at ~~Agreement,~~the ~~dated~~present astime ofthat ~~July 12,~~are ~~2017~~reasonably ~~(the~~likely ~~“ISDA~~to ~~Schedule”),~~result ~~and~~in athe ~~2016~~Partnership’s ~~Credit~~liquidity ~~Support~~increasing ~~Annex~~or ~~for~~decreasing ~~Variation~~in any ~~Margin~~material ~~to the ISDA Schedule~~way.

The ~~Master~~Partnership’s ~~Agreement~~capital ~~will~~consists ~~terminate~~of ~~upon~~the ~~either~~capital ~~party’s~~contributions ~~failure~~of tothe ~~pay,~~partners ~~breach~~as ofincreased ~~the~~or ~~Master~~decreased ~~Agreement,~~by ~~certain~~net ~~defaults,~~realized ~~bankruptcy,~~and/or ~~merger~~unrealized ~~without~~gains ~~assumption~~or losses on trading and by expenses, orinterest ~~upon~~income, ~~such~~redemptions ~~other~~of ~~events~~Units, asand ~~described~~distributions inof ~~the~~profit, ~~Master~~if ~~Agreement~~any.

19For the nine months ended September 30, 2017, the Partnership’s capital decreased 21.8% from $62,870,541 to $49,177,349. This decrease was attributable to redemptions of 599,292.869 limited partner Units totaling $10,450,540, redemptions of 1,391.982 General Partner Units totaling $25,000, coupled with a net loss of $3,217,652. Future redemptions can impact the amount of funds available for investments in subsequent periods.

~~Item~~Other 2.than ~~Management’s~~as ~~Discussion~~discussed ~~and~~above, ~~Analysis~~there ofare ~~Financial~~no known ~~Condition~~material ~~and~~trends, ~~Results~~favorable ofor ~~Operations~~unfavorable, that would affect, nor any expected material changes to, the Partnership’s capital resource arrangements at the present time.

~~Liquidity~~Off-Balance Sheet Arrangements and ~~Capital~~Contractual ~~Resources~~Obligations

The Partnership does not have, ~~nor~~any ~~does~~off-balance itsheet ~~expect to have~~arrangements, ~~any~~nor ~~capital assets. The Partnership~~ does ~~not~~it ~~engage in sales of~~have ~~goods~~contractual obligations or ~~services.~~commercial ~~Its~~commitments ~~assets~~to ~~are~~make ~~its~~future ~~(i) investment in SECOR Master Fund~~payments, ~~(ii) equity~~that inwould ~~trading~~affect account, consisting of restricted and unrestricted cash, net unrealized appreciation on open futures contracts, net unrealized appreciation on open forward contracts, and investment in U.S. Treasury bills at fair value, if applicable, (iii) cash at bank and (iv) interest receivable. Because of the low margin deposits normally required in commodity futures trading, relatively small price movements may result in substantial losses to the Partnership, through its ~~direct investments and investment in SECOR Master Fund. While substantial losses could lead to a material decrease in~~ liquidity, noor ~~such~~capital ~~illiquidity occurred in the second quarter of 2017~~resources.

~~The~~Critical ~~Partnership’s/SECOR Master Fund’s investment in futures, forwards and options~~Accounting ~~may,~~Policies from time to time, be illiquid. Most U.S. futures exchanges limit fluctuations in prices during a single day by regulations referred to as “daily price fluctuation limits” or “daily limits.” Trades may not be executed at prices beyond the daily limit. If the price for a particular futures or option contract has increased or decreased by an amount equal to the daily limit, positions in that futures or option contract can neither be taken nor liquidated unless traders are willing to effect trades at or within the limit. Futures prices have occasionally moved the daily limit for several consecutive days with little or no trading. These market conditions could prevent the Partnership from promptly liquidating its futures or option contracts and result in restrictions on redemptions.

~~There~~The ispreparation noof ~~limitation~~financial onstatements ~~daily~~in ~~price~~conformity ~~movements~~with inGAAP requires the General Partner to make ~~trading~~estimates ~~forward~~and ~~contracts~~assumptions onthat ~~foreign~~affect ~~currencies.~~the ~~The~~reported ~~markets~~amounts ~~for~~of ~~some~~assets ~~world~~and ~~currencies~~liabilities ~~have~~and ~~low~~disclosures ~~trading~~of ~~volume~~contingent assets and ~~are~~liabilities ~~illiquid,~~at ~~which~~the ~~may~~date ~~prevent~~of the ~~Partnership~~financial ~~from~~statements ~~trading~~and inthe ~~potentially~~reported ~~profitable~~amounts ~~markets~~of orincome ~~prevent~~and ~~the~~expense ~~Partnership~~during ~~from~~the reporting ~~promptly~~periods. ~~liquidating~~The ~~unfavorable~~General ~~positions~~Partner inbelieves ~~such~~that ~~markets,~~the ~~subjecting~~estimates itand toassumptions ~~substantial~~utilized ~~losses.~~in ~~Either~~preparing ofthe ~~these~~financial ~~market~~statements ~~conditions~~are ~~could~~reasonable. ~~result~~Actual inresults ~~restrictions~~could ondiffer ~~redemptions~~from those estimates. ~~For~~The ~~the~~Partnership’s ~~periods~~significant ~~covered~~accounting bypolicies ~~this~~are described ~~report~~in detail in Note 2, ~~illiquidity~~“Basis ~~has~~of ~~not~~Presentation ~~materially affected~~and Summary of Significant Accounting Policies,” of the ~~Partnership’s~~Financial ~~assets~~Statements.

~~Other~~19 than the risks inherent in commodity futures, forward, options, swaps and other derivatives trading and U.S. treasury bills and money market mutual fund securities, the Partnership knows of no trends, demands, commitments, events or uncertainties at the present time that are reasonably likely to result in the Partnership’s liquidity increasing or decreasing in any material way.

The Partnership’s ~~capital~~and ~~consists~~SECOR ofMaster ~~the~~Fund record all investments at fair value in ~~capital~~their ~~contributions~~financial ofstatements, ~~the~~with ~~partners~~changes asin ~~increased~~fair orvalue ~~decreased~~reported byas a component of net realized gains (losses) and~~/or~~ net change in unrealized gains or (losses) onin ~~trading~~the Statements of Income and byExpenses. ~~expenses,~~The ~~interest~~General ~~income~~Partner estimates that, ~~redemptions~~at ofany ~~Units~~given time, ~~and~~approximately ~~distributions~~23.5% to 39.2% of ~~profit,~~the ifPartnership’s ~~any~~contracts are traded over-the-counter.

~~For~~Results ~~the six months ended June 30, 2017, Partnership capital decreased 14.7% from $62,870,541 to $53,628,989. This decrease was attributable to redemptions~~ of ~~451,294.877~~Operations limited partner Units totaling $7,932,930, redemptions of 1,391.982 General Partner Units totaling $25,000 coupled with a net loss of $1,283,622. Future redemptions can impact the amount of funds available for investments in subsequent periods.

~~Other~~General. ~~than~~The asPartnership’s ~~discussed~~results ~~above,~~depend ~~there~~on ~~are~~the noTrading ~~known~~Advisors ~~material~~and ~~trends, favorable~~the orability ~~unfavorable,~~of ~~that~~each ~~would~~Trading ~~affect,~~Advisor’s trading ~~nor~~program ~~any expected material changes~~ to, ~~the~~take ~~Partnership’s~~advantage ~~capital~~of ~~resource~~price ~~arrangements~~movements atin the ~~present~~Futures ~~time~~Interests markets.

~~Off~~Aspect trades the allocated portion of the Partnership’s assets in accordance with its Diversified Program, a proprietary, systematic trading system. The Diversified Program is a proprietary, systematic global futures trading program. Its goal is the generation of significant long-~~Balance~~term ~~Sheet~~capital ~~Arrangements~~growth independent of stock and ~~Contractual~~bond ~~Obligations~~market returns. This program continuously monitors price movements in a wide range of global financial, currency and commodity markets, searching for profit opportunities over periods ranging from a few hours to several months.

~~The~~Aspect ~~Partnership~~has ~~does~~designed ~~not~~the Diversified Program to have ~~any~~broad ~~off-balance~~market ~~sheet~~diversification (subject ~~arrangements,~~to ~~nor~~liquidity ~~does~~constraints). itAspect’s ~~have contractual~~quantitative ~~obligations~~resources orare ~~commercial~~sufficient ~~commitments~~to enable it to ~~make~~design ~~future~~and ~~payments,~~implement ~~that~~a ~~would~~broadly ~~affect~~diversified ~~its~~portfolio ~~liquidity~~with ora ~~capital~~significant ~~resources~~allocation to numerous different markets.

~~Critical~~Aspect’s ~~Accounting~~Diversified Program trades in over 100 markets in the seven major sectors: currencies, energy, metals, stock ~~Policies~~indices, bonds, agricultural commodities and interest rates implementing momentum strategies. Aspect is constantly examining new liquid and uncorrelated markets to incorporate in the program with the aim of improving its reward/risk ratio and capacity. Aspect has no market or sector preferences, believing that, allowing for liquidity effects, equal profitability can be achieved in the long-term in all markets. The key factors in determining the asset allocation are correlation and liquidity. Correlations are analyzed at the sector, sub-sector, economic block and market levels to design a portfolio which is highly diversified.

~~The~~Campbell ~~preparation~~trades ~~of financial statements in conformity with GAAP requires~~ the ~~General~~allocated ~~Partner~~portion toof ~~make estimates and assumptions that affect~~ the ~~reported~~Partnership’s ~~amounts of~~ assets ~~and~~in ~~liabilities~~accordance ~~and~~with ~~disclosures~~its ofFinancial, ~~contingent~~Metal ~~assets~~Energy ~~and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting~~Large ~~periods.~~Portfolio, ~~The~~a ~~General~~proprietary, ~~Partner~~systematic ~~believes~~trading ~~that the estimates and assumptions utilized in preparing the financial statements are reasonable~~program. ~~Actual results could differ from those estimates. The Partnership~~Campbell’s ~~significant~~trading ~~accounting~~models ~~policies~~ are ~~described~~ indesigned ~~detail~~to indetect ~~Note~~and 2,exploit ~~“Basis~~medium-term ofto ~~Presentation~~long-term ~~and~~price ~~Summary~~changes, ofwhile ~~Significant~~also ~~Accounting~~applying ~~Policies,”~~risk ofmanagement ~~the~~and ~~Financial~~portfolio ~~Statements~~management principles.

~~The~~Campbell ~~Partnership~~believes that utilizing multiple trading models provides an important level of diversification, and ~~SECOR~~is ~~Master~~most ~~Fund~~beneficial when ~~record~~multiple ~~all~~contracts ~~investments~~of ateach ~~fair~~market ~~value~~are intraded. ~~their~~Every ~~financial~~trading ~~statements,~~model ~~with~~may ~~changes~~not trade every market. It is possible that one trading model may signal a long position while another trading model signals a short position in ~~fair~~the same market. It is ~~value~~Campbell’s ~~reported~~intention asto aoffset ~~component~~those ofsignals ~~net~~to ~~realized~~reduce ~~gains~~unnecessary ~~(losses)~~trading, but if the signals are not simultaneous, both trades will be taken and ~~net~~since ~~change~~it inis ~~unrealized~~unlikely ~~gains~~that ~~(losses)~~both positions would prove profitable, in ~~the~~retrospect, ~~Statements~~one or both trades will appear to have been unnecessary. It is Campbell’s policy to follow trades signaled by each trading model independently of ~~Income~~the ~~and~~other ~~Expenses~~models.

20SECOR’s investment objectives are to generate high risk-adjusted returns by: (i) investing across a diverse set of asset classes, geographies, factors, themes and time horizons, (ii) identifying and exploiting temporarily pronounced market inefficiencies or risk premia, (iii) employing dynamic risk-budgeting to minimize tail risk and potentially enable alpha to be generated through timing of exposures and (iv) utilizing sophisticated modeling techniques supported by straight-forward economic intuition and sound fundamentals. SECOR will seek to target long-term annualized volatility of 15% and low long-term correlation to other hedge fund strategies and broader markets. SECOR has a healthy respect for the general information efficiency of markets but believes that certain inefficiencies (or outsized risk premia) may exist in certain markets, and these or other inefficiencies (or risk premia) may periodically become more pronounced in particular market conditions. SECOR believes that it is feasible to construct an investment strategy that seeks to capture such inefficiencies (premia) in pursuit of high risk-adjusted returns (or excess returns for benchmarked mandates) that are lowly correlated with broad stock and bond market returns (alpha). SECOR employs statistical techniques and empirical analysis to help determine whether they believe that observed or conjectured alpha opportunities are real and, more importantly, likely to be sustained in the future. If properly employed, these techniques may have certain advantages versus a purely judgmental approach including the potential ability to: control for the impact of particular factors, evaluate phenomena over longer history, systematically assess confidence levels based on availability of data, evaluate performance over certain sub-periods and market cycles, identify certain possible causation and lead/lag effects, reduce certain common behavioral biases in human judgment and evaluate a range of factors in a systematic way.

~~Results~~20 ~~of Operations~~

~~General.~~FORT ~~The~~trades the allocated portion of the Partnership’s ~~results~~assets ~~depend~~in onaccordance with ~~the~~its ~~Trading~~Global ~~Advisors~~Contrarian ~~and~~Program ~~the~~(“Global ~~ability~~Contrarian”), ofa ~~each~~systematic, ~~Trading~~technical, ~~Advisor’s~~ trend-anticipating trading program. Global Contrarian’s investment objective is to ~~take~~achieve ~~advantage~~attractive absolute returns and reduced volatility of returns ~~price~~primarily ~~movements~~through intrading ~~the~~a ~~Futures~~broad ~~Interests~~spectrum ~~markets~~of futures contracts, including contracts on short-term interest rates, bonds, currencies, stock indices energy and metals.

~~Aspect~~Global ~~trades~~Contrarian ~~the~~generally ~~allocated portion~~seeks ofto ~~the~~anticipate ~~Partnership’s~~and ~~assets~~capitalize inon ~~accordance~~short-to-intermediate-term ~~with~~trends ~~its~~(two ~~Diversified~~to ~~Program,~~six weeks). Unlike a ~~proprietary~~trend-following program, ~~systematic~~which ~~trading~~would ~~system~~attempt to identify existing trends, Global Contrarian attempts to anticipate trends before they occur. Global ~~The~~Contrarian ~~Diversified~~takes ~~Program~~positions while the market is moving against the signal. As a ~~proprietary~~result, ~~systematic~~its ~~global~~performance ~~futures~~can ~~trading~~be ~~program.~~much ~~Its~~more ~~goal~~volatile than traditional trend-following models, but the potential for diversification is much greater. In an attempt to reduce the ~~generation~~volatility of ~~significant~~ ~~long-term~~returns, the allocation of capital ~~growth~~is ~~independent~~geographically ofdiversified ~~stock~~across ~~and~~Asia, ~~bond~~Europe, ~~market~~Australia ~~returns~~and North America. ~~This~~FORT ~~program~~exercises ~~continuously~~little ~~monitors~~or ~~price~~no ~~movements~~discretion inover athe ~~wide~~rule-based ~~range~~and ofcomputerized ~~global~~trading ~~financial,~~signals ~~currency~~generated ~~and~~by Global ~~commodity~~Contrarian. Global Contrarian uses Bayesian learning techniques to systematically adjust model parameters, markets, ~~searching~~and sectors. The learning process favors both winners and losers for ~~profit~~allocations. ~~opportunities~~For ~~over~~example, markets that underperform ~~periods~~recently ~~ranging~~but ~~from~~perform awell ~~few~~over ~~hours~~the tolong-term ~~several~~are ~~months~~candidates for allocation.

~~Aspect~~Prior ~~has~~to ~~designed~~its ~~the~~termination ~~Diversified~~on ~~Program~~March 31, 2016, toWinton ~~have~~traded ~~broad~~the ~~market diversification~~Partnership’s ~~(subject~~assets toin ~~liquidity~~accordance ~~constraints).~~with ~~Aspect’s~~its ~~quantitative~~Diversified ~~resources~~Program, ~~are~~a ~~sufficient~~proprietary, tosystematic ~~enable~~trading itsystem. toThe ~~design~~Diversified ~~and~~Program ~~implement~~trades aapproximately ~~broadly~~95 ~~diversified~~futures ~~portfolio~~and ~~with~~forward acontracts ~~significant~~on ~~allocation~~U.S. toand ~~numerous~~non-U.S. ~~different~~exchanges and markets.

~~Aspect’s~~Winton ~~Diversified~~employed ~~Program~~a ~~trades~~fully ~~in over 100 markets in the seven major sectors: currencies~~systematic, ~~energy~~computerized, ~~metals, stock~~ ~~indices~~technical, ~~bonds,~~trend-following ~~agricultural~~trading ~~commodities~~system ~~and~~developed ~~interest~~by ~~rates~~its ~~implementing momentum strategies~~principals. ~~Aspect~~This issystem ~~constantly~~tracks ~~examining~~the ~~new~~daily ~~liquid~~price ~~and~~movements ~~uncorrelated~~from these markets toaround ~~incorporate in~~ the ~~program~~world, ~~with~~and ~~the~~carries ~~aim~~out ofcertain ~~improving~~computations ~~its~~to ~~reward/risk~~determine ~~ratio~~each ~~and capacity.~~day ~~Aspect~~how ~~has~~long ~~no market~~ or ~~sector~~short ~~preferences,~~the ~~believing~~portfolio should ~~that,~~be ~~allowing~~in ~~for~~an ~~liquidity~~attempt ~~effects,~~to ~~equal~~maximize ~~profitability~~profit ~~can~~within bea ~~achieved~~certain inrange ~~the~~of ~~long-term in all markets~~risk. ~~The~~If ~~key~~rising ~~factors~~prices in ~~determining~~a ~~the~~particular ~~asset~~market ~~allocation~~ are ~~correlation~~anticipated, ~~and liquidity.~~a ~~Correlations~~long ~~are~~position ~~analyzed~~will atbe ~~the~~established ~~sector,~~in ~~sub-sector,~~that ~~economic~~market; ~~block~~if ~~and~~prices in a particular market ~~levels~~are expected to ~~design~~fall, a ~~portfolio~~short position ~~which~~in isthat ~~highly~~market ~~diversified~~will be established.

~~Campbell~~The ~~trades~~General ~~the~~Partner ~~allocated~~is ~~portion~~not aware of ~~the~~any ~~Partnership’s~~material ~~assets~~changes into ~~accordance~~any ~~with~~of ~~its Financial, Metal Energy Large~~the ~~Portfolio, a proprietary, systematic~~ trading ~~program.~~programs ~~Campbell’s~~discussed ~~trading~~above ~~models~~during ~~are~~the ~~designed~~fiscal toquarter ~~detect~~ended ~~and exploit medium-term to long-term price changes~~September 30, ~~while also applying risk management and portfolio management principles~~2017.

~~Campbell~~The ~~believes~~following ~~that~~chart ~~utilizing~~sets ~~multiple~~forth the ~~trading~~percentage ~~models provides an important level of diversification,~~ and isthe ~~most beneficial~~amount ~~when multiple contracts~~ of ~~each market are traded. Every trading model may not trade every market. It is possible that one trading model may signal a long position while another trading model signals a short position in~~ the ~~same market. It is Campbell~~Partnership’s ~~intention~~net toassets ~~offset~~allocated ~~those signals~~ to ~~reduce~~each ~~unnecessary~~Trading ~~trading,~~Advisor ~~but~~as ifof ~~the signals are not simultaneous~~September 30, ~~both~~2017 ~~trades will be taken~~ and ~~since~~June 30, ~~it is unlikely that both positions would prove profitable~~2017, ~~in retrospect~~respectively, ~~one~~and orthe ~~both trades~~change ~~will~~during ~~appear~~the tothree ~~have~~months ~~been~~ended ~~unnecessary.~~September 30, ~~It is Campbell’s policy to follow trades signaled by each trading model independently of the other models~~2017.

SECOR’s investment objectives are to generate high risk-adjusted returns by: (i) investing across a diverse set of asset classes, geographies, factors, themes and time horizons, (ii) identifying and exploiting temporarily pronounced market inefficiencies or risk premia, (iii) employing dynamic risk-budgeting to minimize tail risk and potentially enable alpha to be generated through timing of exposures and (iv) utilizing sophisticated modeling techniques supported by straight-forward economic intuition and sound fundamentals. SECOR will seek to target long-term annualized volatility of 15% and low long-term correlation to other hedge fund strategies and broader markets. SECOR has a healthy respect for the general information efficiency of markets but believes that certain inefficiencies (or outsized risk premia) may exist in certain markets, and these or other inefficiencies (or risk premia) may periodically become more pronounced in particular market conditions. SECOR believes that it is feasible to construct an investment strategy that seeks to capture such inefficiencies (premia) in pursuit of high risk-adjusted returns (or excess returns for benchmarked mandates) that are lowly correlated with broad stock and bond market returns (alpha). SECOR employs statistical techniques and empirical analysis to help determine whether they believe that observed or conjectured alpha opportunities are real and, more importantly, likely to be sustained in the future. If properly employed, these techniques may have certain advantages versus a purely judgmental approach including the potential ability to: control for the impact of particular factors, evaluate phenomena over longer history, systematically assess confidence levels based on availability of data, evaluate performance over certain sub-periods and market cycles, identify certain possible causation and lead/lag effects, reduce certain common behavioral biases in human judgment and evaluate a range of factors in a systematic way.


Trading Advisor	Allocation as of September 30, 2017 (% )			Allocation as of June 30, 2017 (% )			Allocation as of September 30, 2017 ($)		Allocation as of June 30, 2017 ($)		Change during the period (% )
Aspect		21.48	%		21.61	%	$	10,561,153	$	11,590,425		(8.88	) %
Campbell		16.35			15.37			8,040,759		8,241,414		(2.43	)
SECOR		34.43			35.63			16,933,995		19,107,404		(11.37	)
FORT		27.74			27.39			13,641,442		14,689,746		(7.14	)

~~FORT~~The ~~trades~~following ~~the~~presents ~~allocated~~a ~~portion~~summary of the Partnership’s ~~assets~~operations infor ~~accordance~~the ~~with~~three ~~its~~and ~~Global~~nine months ~~Contrarian~~ended ~~Program (“Global~~September 30, ~~Contrarian”)~~2017, and a ~~systematic,~~general ~~technical,~~discussion ~~trend-anticipating~~of its trading ~~program.~~activities ~~Global~~during ~~Contrarian’s~~the ~~investment~~periods. ~~objective~~It is important to ~~achieve~~note, ~~attractive~~however, ~~absolute~~that ~~returns~~the Trading Advisors trade in various markets at different times and ~~reduced~~that ~~volatility~~prior activity in a particular market does not mean that such market will be actively traded by the Trading Advisors or will be profitable in the future. Consequently, the results of ~~returns~~operations ~~primarily~~of ~~through~~the ~~trading~~Partnership aare ~~broad spectrum~~difficult to discuss other than in the context of the ~~futures~~Trading ~~contracts,~~Advisors’ ~~including~~trading ~~contracts~~activities on ~~short-term~~behalf ~~interest~~of ~~rates,~~the ~~bonds,~~Partnership ~~currencies,~~during ~~stock~~the ~~indices~~periods ~~energy~~in ~~and~~question. ~~metals~~Past performance is no guarantee of future results.

21The Partnership’s results of operations set forth in the financial statements are prepared in accordance with GAAP, which require the use of certain accounting policies that affect the amounts reported in these financial statements, including the following: the contracts the Partnership and SECOR Master Fund trade are accounted for on a trade-date basis and marked to market on a daily basis. The difference between their original contract value and market value is recorded in the Statements of Income and Expenses as “Net change in unrealized gains (losses) on open contracts” and “Net change in unrealized gains (losses) on open contracts allocated from SECOR Master Fund” and recorded as “Net realized gains (losses) on closed contracts” and “Net realized gains (losses) on closed contracts allocated from SECOR Master Fund” when open positions are closed out. The sum of these amounts constitutes the Partnership’s trading results. The fair value of a futures contract is the settlement price on the exchange on which that futures contract is traded on a particular day. The fair value of a foreign currency forward contract is based on the spot prices quoted as of approximately 3:00 P.M. (E.T.), the close of the business day. Interest income, as well as management fees, incentive fees, General

~~Global~~21 Contrarian generally seeks to anticipate and capitalize on short-to-intermediate-term trends (two to six weeks). Unlike a trend-following program, which would attempt to identify existing trends, Global Contrarian attempts to anticipate trends before they occur. Global Contrarian takes positions while the market is moving against the signal. As a result, its performance can be much more volatile than traditional trend-following models, but the potential for diversification is much greater. In an attempt to reduce the volatility of returns, the allocation of capital is geographically diversified across Asia, Europe, Australia and North America. FORT exercises little or no discretion over the rule-based and computerized trading signals generated by Global Contrarian. Global Contrarian uses Bayesian learning techniques to systematically adjust model parameters, markets, and sectors. The learning process favors both winners and losers for allocations. For example, markets that underperform recently but perform well over the long-term are candidates for allocation.

~~The~~ Partner ~~General~~fees ~~Partner~~and isongoing ~~not~~placement ~~aware~~agent fees of ~~any~~the ~~material~~Partnership ~~changes~~are torecorded ~~any~~on ofan ~~the~~accrual ~~trading~~basis, ~~programs~~as ~~discussed~~applicable. ~~above~~The ~~during~~Partnership ~~the~~records ~~fiscal~~its investment in SECOR Master Fund at fair value on the ~~quarter~~basis ~~ended~~of ~~June 30,~~the ~~2017~~net asset value of such investments.

~~Prior~~The toGeneral ~~March 31,~~Partner ~~2016~~believes that, ~~Winton~~based ~~traded~~on the ~~Partnership’s~~nature ~~assets~~of inthe ~~accordance~~operations ~~with~~of ~~its~~the ~~Diversified Program~~Partnership, ano ~~proprietary,~~assumptions ~~systematic~~relating ~~trading~~to ~~system.~~the ~~The~~application ~~Diversified~~of ~~Program~~critical ~~trades~~accounting ~~approximately~~policies 95other ~~futures~~than ~~and~~those ~~forward~~presently ~~contracts~~used oncould ~~U.S.~~reasonably ~~and~~affect ~~non-U.S.~~reported ~~exchanges and markets~~amounts.

~~Winton~~During ~~employed~~the aPartnership’s ~~fully~~third ~~systematic,~~quarter ~~computerized,~~of ~~technical~~2017, ~~trend-following~~the ~~trading~~net ~~system~~asset ~~developed~~value byper ~~its~~Unit ~~principals~~decreased 3.7% ~~This~~from $17.18 to $16.54, as ~~system~~compared ~~tracks~~to an increase of 0.3% during the ~~daily~~third ~~price~~quarter ~~movements~~of ~~from~~2016. ~~these~~The ~~markets~~Partnership ~~around~~experienced ~~the~~a ~~world,~~net trading loss before fees and ~~carries~~expenses ~~out~~in ~~certain~~the ~~computations~~third toquarter ~~determine~~of ~~each~~2017 ~~day~~of ~~how~~$1,304,837. ~~long~~Losses orwere ~~short~~primarily attributable to the ~~portfolio~~Partnership’s/SECOR Master ~~should~~Fund’s betrading of Futures Interests in anthe ~~attempt~~commodity, toequity, ~~maximize~~currencies, ~~profit~~and ~~within~~interest rate sectors. Partnership experienced a ~~certain~~net ~~range~~trading ofgain ~~risk.~~before ~~If rising~~fees ~~prices~~and expenses in athe ~~particular~~third ~~market~~quarter ~~are~~of ~~anticipated~~2016 of $1,318,135. aGains ~~long~~were ~~position~~primarily attributable ~~will~~to bethe ~~established~~Partnership’s/SECOR inMaster ~~that~~Fund’s ~~market;~~trading ifof ~~prices~~Futures Interests in athe ~~particular~~equity ~~market~~sector ~~are~~and ~~expected~~were topartially ~~fall,~~offset aby ~~short~~losses ~~position~~ in ~~that~~the ~~market~~commodities, ~~will~~currencies beand ~~established~~interest rates sectors.

The ~~following~~most ~~chart~~significant ~~sets~~losses ~~forth~~were incurred within the ~~percentage~~agricultural sector, primarily during July, from short positions in soybean futures as drought conditions in portions of the Midwest threatened crops, pushing prices higher. Further losses were experienced from short futures positions in coffee as prices rallied amid reports of poor crop qualities in Brazil and West Africa. Within the ~~amount~~currency sector, losses were incurred during September from long positions in the Australian dollar versus the U.S. dollar as the relative value of the ~~Partnership’s~~U.S. ~~net~~dollar ~~assets~~moved ~~allocated~~higher as signals indicated the U.S. economy continued to outpace ~~each~~its ~~Trading~~global peers. Within the energy sector, losses were incurred during July and September from short positions in crude oil futures as prices moved higher as industry reports indicated global supplies were tighter than previously estimated ~~Advisor~~while demand exceeded analysts’ predictions. Within the metals sector, losses were incurred during July and September from long positions in copper futures as prices declined sharply amid reports of ~~June 30,~~growing ~~2017~~supplies and ~~March 31,~~weakening ~~2017,~~global ~~respectively~~demand. Within the global interest rate sector, losses were incurred during September from long positions in U.S. and European fixed income futures as the ~~change~~global ~~during~~bond market experienced a sell-off after hawkish comments from the ~~three~~European ~~months~~Central ~~ended~~Bank ~~June 30~~and Bank of England, ~~2017~~as well as confirmation from the U.S. Federal Reserve that it remains committed to unwinding its quantitative easing program. The Partnership’s losses for the quarter were partially offset by gains experienced within the global stock index sector, primarily during July, from long Pacific Rim index futures positions as prices advanced amid growing confidence in the strength of the global economy.

Trading Advisor	Allocation as ofJune 30,2017 (%)			Allocation as ofMarch 31,2017 (%)			Allocation as ofJune 30,2017 ($)		Allocation as ofMarch 31,2017 ($)		Changeduring theperiod (%)
Aspect		21.61	%		23.24	%	$	11,590,425		$ 13,494,499		(14.11	)%
Campbell		15.37			17.00			8,241,414		9,868,256		(16.49	)
SECOR		35.63			31.72			19,107,404		18,416,982		3.75
FORT		27.39			28.04			14,689,746		16,279,360		(9.76	)

During the Partnership’s nine months ended September 30, 2017, the net asset value per Unit decreased 6.0% from $17.59 to $16.54, as compared to a decrease of 2.5% for the nine months ended September 30, 2016. The Partnership experienced a net trading loss before fees and expenses nine months ended September 30, 2017 of $1,093,972. Losses were primarily attributable to the Partnership’s/SECOR Master Fund’s trading of Futures Interests in the commodity, currencies and interest rate sectors and were partially offset by gains in the equity sector. The Partnership experienced a net trading gain before fees and expenses for the nine months ended September 30, 2016 of $1,479,856. Gains were primarily attributable to the Partnership’s/SECOR Master Fund’s trading of Futures Interests in equity and interest rates sectors and were partially offset by losses in commodities and currencies sectors.

~~The~~Within the global interest rate sector, losses were incurred primarily during the last week of June from long European fixed income futures positions as prices reversed lower following ~~presents~~comments aby ~~summary~~Mario Draghi, President of the ~~Partnership’s~~European ~~operations~~Central ~~for~~Bank, ~~the~~expressing ~~three~~optimism ~~months~~on Eurozone ~~ended~~inflation, which triggered a rebound in government bond yields. Further losses in European fixed income futures were experienced during September. Losses were also incurred in Australian fixed income futures trading during June 30. Within the currency sector, ~~2017~~losses were incurred during March, May, and aSeptember ~~general~~from ~~discussion~~short positions in the euro versus the U.S. dollar as the relative value of the U.S. dollar broadly declined against its ~~trading~~major ~~activities~~counterparts ~~during~~amid ~~each~~increased ~~period~~hawkish rhetoric from non-U.S. Itcentral isbanks. ~~important~~Within tothe ~~note,~~agricultural ~~however~~sector, ~~that~~losses ~~the~~were ~~Trading~~incurred ~~Advisors~~during ~~trade~~January and February from short positions in ~~various~~wheat ~~markets~~futures atas ~~different~~prices ~~times~~moved ~~and~~higher ~~that~~on ~~prior~~expectations ~~activity~~of instrong ademand ~~particular~~after ~~market~~a decline ~~does~~in ~~not~~prices. ~~mean~~Additional ~~that~~losses ~~such~~from ~~market~~short ~~will~~wheat befutures ~~actively~~positions ~~traded~~were byrecorded ~~the~~during ~~Trading~~June ~~Advisors~~as orprices ~~will~~spiked behigher ~~profitable~~late in the ~~future~~month. ~~Consequently~~Meanwhile, ~~the~~losses ~~results~~were ofincurred ~~operations~~during ofJuly from positions in coffee and sugar futures. Within the ~~Partnership~~energy ~~are~~sector, losses ~~difficult~~were toincurred ~~discuss~~during ~~other~~January ~~than~~from positions in gasoline futures as prices moved without consistent direction throughout the ~~context~~month amid speculation regarding the surplus of U.S. gasoline. Additional losses were incurred during January from long positions in natural gas futures as prices decreased amid limited demand due to milder-than-normal temperatures in North America. Within the ~~Trading~~metals sector, losses were incurred during June from short futures positions in industrial metals as ~~Advisors’~~prices increased after stronger economic data in the U.S. and China bolstered the demand outlook for these metals. Additional losses were incurred during July and September from positions in gold, silver, and copper futures. The Partnership’s trading ~~activities~~losses onfor ~~behalf~~the first nine months of the ~~Partnership~~year ~~during~~were offset by trading gains experienced within the ~~periods~~global stock index sector, primarily during January, February, and May from long positions in ~~question~~European, U.S., ~~Past~~and ~~performance~~Asian isequity noindex ~~guarantee~~futures ofas prices ~~future~~rallied ~~results~~amid growing global economic confidence and a renewed bullishness about President Donald Trump’s policies, in particular those relating to tax reform and the impact they may have on economic growth.

~~The~~22 Partnership’s results of operations set forth in the financial statements are prepared in accordance with GAAP, which require the use of certain accounting policies that affect the amounts reported in these financial statements, including the following: the contracts the Partnership and SECOR Master Fund trade are accounted for on a trade-date basis and marked to market on a daily basis. The difference between their original contract value and market value is recorded in the Statements of Income and Expenses as “Net change in unrealized gains (losses) on open contracts” and “Net change in unrealized gains (losses) on open contracts allocated from SECOR Master Fund” and recorded as “Net realized gains (losses) on closed contracts” and “Net realized gains (losses) on closed contracts allocated from SECOR Master Fund” when open positions are closed out. The sum of these amounts constitutes the Partnership’s trading results. Interest income, as well as management fees, incentive fees, General Partner fees and ongoing placement agent fees of the Partnership are recorded on an accrual basis, as applicable. The Partnership records its investment in SECOR Master Fund at fair value on the basis of the net asset value of such investments.

~~The~~Item ~~General~~3. ~~Partner~~Quantitative ~~believes~~and ~~that,~~Qualitative ~~based~~Disclosures onAbout ~~the~~Market ~~nature of the operations of the Partnership, no assumptions relating to the application of critical accounting policies other than those presently used could reasonably affect reported amounts~~Risk.

22The Partnership and SECOR Master Fund are speculative commodity pools. The market sensitive instruments held by the Partnership/SECOR Master Fund are acquired for speculative trading purposes, and all or substantially all of the Partnership/SECOR Master Fund’s assets are subject to the risk of trading loss. Unlike an operating company, the risk of market sensitive instruments is integral, not incidental, to the Partnership’s and SECOR Master Fund’s main line of business.

~~During the Partnership’s second quarter of 2017, the net asset value per Unit decreased 1.6% from $17.46 to $17.18, as compared to a decrease of 3.3% during the second quarter of 2016.~~ The ~~Partnership~~limited ~~experienced~~partners awill ~~net~~not ~~trading~~be ~~loss~~liable ~~before~~for ~~fees~~losses ~~and~~exceeding ~~expenses in~~ the ~~second~~current quarter of 2017 of $158,568. Losses were primarily attributable to the Partnership’s/SECOR Master Fund’s trading of Futures Interests in currencies, energy, grains, non-U.S. interest rates and metals and were partially offset by gains in U.S. interest rates, livestock, indices and softs. Partnership experienced a net ~~trading~~asset ~~loss~~value ~~before fees and expenses in the second quarter~~ of ~~2016~~their ~~of $1,817,358~~investment. Losses were primarily attributable to the Partnership’s/SECOR Master Fund’s trading of Futures Interests in currencies, global stock index, energy and metals and were partially offset by gains in global interest rates and agriculturals.

~~The~~Market ~~most~~movements ~~significant~~result losses were incurred within the global interest rate sector, primarily during the last week of June, from long European fixed income futures positions as prices reversed lower following comments by Mario Draghi, President of the European Central Bank, expressing optimism on Eurozone inflation, which triggered a rebound in ~~government~~frequent ~~bond~~changes ~~yields. Losses were also incurred~~ in ~~Australian fixed income futures trading during June. Within~~ the ~~currency~~fair ~~sector, losses were incurred throughout the second quarter from short positions in the Canadian dollar and Australian dollar versus the U.S. dollar as the relative~~ value of the ~~U.S.~~Partnership’s/SECOR ~~dollar~~Master ~~broadly~~Fund’s ~~declined~~open ~~against its major counterparts amid increased hawkish rhetoric from non-U.S. central banks. Within the metals sector, losses were incurred during June from short futures~~ positions ~~in industrial metals as prices increased after stronger economic data in the U.S.~~ and, ~~China bolstered the demand outlook for these metals. Within the energy sector~~consequently, ~~losses~~in ~~were~~their ~~incurred~~earnings ~~during May from short positions in gasoil~~ and ~~gasoline~~cash ~~futures as refined crude oil product prices advanced as the OPEC nations gathered to discuss extending their production cuts~~balances. The Partnership’s/SECOR ~~losses~~Master ~~for~~Fund’s ~~the~~market ~~quarter~~risk ~~were~~is ~~partially~~influenced ~~offset~~ by ~~gains~~a ~~experienced~~wide ~~within~~variety ~~the global~~of ~~stock index sector~~factors, ~~primarily~~including ~~during~~the ~~April~~level and ~~May,~~volatility ~~from~~of ~~long~~interest ~~positions~~rates, inexchange ~~European~~rates, ~~Asian, and U.S.~~ equity ~~index~~price levels, ~~futures~~the asmarket ~~prices~~value ~~were~~of ~~buoyed~~financial byinstruments ~~increased~~and ~~consumer~~contracts, ~~confidence. Within~~ the ~~agricultural~~diversification ~~sector,~~effects ~~gains~~of ~~were experienced throughout~~ the ~~second~~Partnership’s/SECOR ~~quarter~~Master ~~from~~Fund’s ~~short~~open ~~positions~~contracts inand ~~sugar~~the ~~futures~~liquidity asof ~~prices~~the ~~declined~~markets ~~amid stronger than expected production data from top sugar producer Brazil. Additional gains~~ in ~~this~~which ~~sector~~they ~~were experienced from positions in cattle and coffee futures~~trade.

During the Partnership’s six months ended June 30, 2017, the net asset value per Unit decreased 2.3% from $17.59 to $17.18, as compared to a decrease of 2.8% for the six months ended June 30, 2016. The Partnership ~~experienced a net trading gain before fees and expenses six months ended June 30, 2017 of $210,865. Gains were primarily attributable to the Partnership’s~~/SECOR Master Fund’s ~~trading~~rapidly ofacquire ~~Futures~~and ~~Interests~~liquidate inboth ~~U.S.~~long ~~interest rates, livestock, indices~~ and ~~softs~~short ~~and~~positions ~~were~~in ~~partially~~a ~~offset~~wide byrange ~~losses~~of ~~in currencies, energy, grains,~~different ~~non-U~~markets.S. ~~interest~~Consequently, ~~rates~~it ~~and~~is ~~metals.~~not ~~The~~possible ~~Partnership~~to ~~experienced~~predict how a ~~net~~particular ~~trading~~future ~~gain~~market ~~before~~scenario ~~fees~~will ~~and~~affect ~~expenses for the six months ended June 30~~performance, ~~2016~~and ~~of $161,721. Losses were primarily attributable to~~ the Partnership’s/SECOR Master Fund’s ~~trading~~past ofperformance ~~Futures~~is ~~Interests~~not innecessarily ~~currencies,~~indicative ~~global~~of ~~stock~~their ~~index,~~future ~~energy, and metals and were partially offset by gains in global interest rates and agriculturals~~results.

~~The~~Quantifying ~~most significant losses were incurred within~~ the global interest rate sector, primarily during the last week of June from long European fixed income futures positions as prices reversed lower following comments by Mario Draghi, President of the European Central Bank, expressing optimism on Eurozone inflation, which triggered a rebound in government bond yields. Losses were also incurred in Australian fixed income futures trading during June. Within the currency sector, losses were incurred during March and May from short positions in the euro and Canadian dollar versus the U.S. dollar as the relative value of the U.S. dollar broadly declined against its major counterparts amid increased hawkish rhetoric from non-U.S. central banks. Within the metals sector, losses were incurred during June from short futures positions in industrial metals as prices increased after stronger economic data in the U.S. and China bolstered the demand outlook for these metals. Additional losses were incurred from positions in gold and silver futures. Within the energy sector, losses were incurred during January from positions in gasoline futures as prices moved without consistent direction throughout the month amid speculation regarding the surplus of U.S. gasoline. Additional losses were incurred during January from long positions in natural gas futures as prices decreased amid limited demand due to milder-than-normal temperatures in North America. Within the agricultural sector, losses were incurred during January and February from short positions in wheat futures as prices moved higher on expectations of strong demand after a decline in prices. Additional losses from short wheat futures positions were recorded during June as prices spiked higher late in the month. The Partnership’s/SECOR ~~trading~~Master losses for the first six months of the year were offset by trading gains experienced within the global stock index sector, primarily during January, February, and May from long positions in European, U.S., and Asian equity index futures as prices rallied amid renewed bullishness about President Donald TrumpFund’s ~~policies,~~Trading inValue ~~particular~~at ~~those~~Risk ~~relating to tax reform and the impact they may have on economic growth.~~

23The following quantitative disclosures regarding the Partnership’s/SECOR Master Fund’s market risk exposures contain “forward-looking statements” within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). All quantitative disclosures in this section are deemed to be forward-looking statements for purposes of the safe harbor, except for statements of historical fact.

~~Item~~The 3Partnership/SECOR Master Fund account for open positions on the basis of fair value accounting principles. ~~Quantitative~~Any ~~and~~loss ~~Qualitative~~in ~~Disclosures~~the ~~About~~market ~~Market~~value ~~Risk~~of the Partnership’s/SECOR Master Fund’s open positions are directly reflected in the Partnership’s/SECOR Master Fund’s earnings and cash flow.

The Partnership ~~and~~ ’s/SECOR Master Fund’s ~~are~~risk ~~speculative~~exposure ~~commodity~~in ~~pools.~~the ~~The~~ market ~~sensitive~~sectors ~~instruments~~traded ~~held~~ by the ~~Partnership/SECOR~~ ~~Master~~Trading ~~Fund~~Advisors ~~are~~is ~~acquired~~estimated below ~~for~~in ~~speculative~~terms ~~trading~~of ~~purposes,~~Value ~~and~~at ~~all~~Risk. orPlease ~~substantially~~note ~~all~~that of the ~~Partnership/SECOR~~Value ~~Master~~at ~~Fund’s~~Risk ~~assets~~model ~~are~~is ~~subject~~used to ~~the~~numerically ~~risk~~quantify ofmarket ~~trading~~risk ~~loss.~~for ~~Unlike~~historic anreporting ~~operating~~purposes ~~company,~~only ~~the~~and ~~risk of market sensitive instruments~~ is ~~integral,~~ not ~~incidental,~~utilized toby ~~the~~either ~~Partnership’s~~Ceres ~~and~~or ~~SECOR~~the ~~Master~~Trading ~~Fund’s~~Advisors ~~main~~in ~~line~~their ofdaily ~~business~~risk management activities.

~~The~~“Value ~~limited~~at ~~partners~~Risk” ~~will~~is ~~not~~a measure of the maximum amount which the Partnership/SECOR Master Fund could reasonably be ~~liable~~expected ~~for~~to ~~losses~~lose in a given market sector. However, the inherent uncertainty of the Partnership’s/SECOR Master Fund’s speculative trading and the recurrence in the markets traded by the Partnership/SECOR Master Fund of market movements far exceeding expectations could result in actual trading or non-trading losses far beyond the ~~current~~indicated ~~net~~Value ~~asset~~at ~~value~~Risk or the Partnership’s/SECOR Master Fund’s experience to date (i.e., “risk of ruin”). In light of the foregoing as well as the risks and uncertainties intrinsic to all future projections, the inclusion of the quantification in this section should not be considered to constitute any assurance or representation that the Partnership’s/SECOR Master Fund’s losses in any market sector will be limited to Value at Risk or by the Partnership’s/SECOR Master Fund’s attempt to manage their ~~investment~~market risk.

~~Market~~Exchange ~~movements~~margin ~~result~~requirements inhave ~~frequent~~been ~~changes~~used inby the ~~fair value of the~~ Partnership/SECOR Master Fund’s ~~open~~as ~~positions~~the ~~and, consequently,~~measure inof their ~~earnings~~Value ~~and~~at ~~cash balances~~Risk. ~~The~~Margin requirements ~~Partnership/SECOR~~are ~~Master~~set ~~Fund’s~~by ~~market~~exchanges ~~risk~~to isequal ~~influenced~~or byexceed athe ~~wide~~maximum ~~variety~~losses ofreasonably ~~factors,~~expected ~~including~~to be incurred in the ~~level~~fair ~~and~~value ~~volatility~~of any given contract in 95%-99% of ~~interest~~any one-day ~~rates,~~interval. ~~exchange~~The ~~rates,~~margin ~~equity~~levels are established by dealers and exchanges using historical price ~~levels,~~studies ~~the~~as ~~market value~~well as an assessment of ~~financial~~current ~~instruments~~market ~~and~~volatility ~~contracts,~~(including the ~~diversification~~implied ~~effects~~volatility of the options ~~Partnership/SECOR~~on ~~Master~~a ~~Fund’s~~given ~~open~~futures ~~contracts~~contract) and ~~the~~economic ~~liquidity~~fundamentals to provide a probabilistic estimate of the ~~markets~~maximum inexpected ~~which~~near-term ~~they~~one-day ~~trade~~price fluctuation.

~~The~~Value ~~Partnership/SECOR~~at ~~Master~~Risk ~~Fund~~tables ~~rapidly~~represent ~~acquire~~a ~~and~~probabilistic ~~liquidate~~assessment ~~both~~of ~~long~~the ~~and~~risk ~~short~~of ~~positions~~loss in amarket ~~wide~~risk ~~range~~sensitive ofinstruments. ~~different~~The Trading ~~markets.~~Advisors, ~~Consequently~~with exception to SECOR, itcurrently istrade ~~not~~the ~~possible~~Partnership’s assets directly in managed accounts established in the name of the Partnership, over which they have been granted limited authority to ~~predict~~make ~~how~~trading adecisions. ~~particular~~The ~~future~~following trading Value at Risk tables reflect the market ~~scenario~~sensitive ~~will~~instruments ~~affect~~held ~~performance,~~by the Partnership and aindirectly, through its investments in the SECOR Master Fund. There have been no material changes in the trading Value at Risk information previously disclosed in the Partnership’s ~~past~~Annual ~~performance~~Report ison ~~not~~Form ~~necessarily~~10-K ~~indicative~~for ofthe ~~future~~year ~~results~~ended December 31, 2016.

~~Quantifying~~23 ~~the Partnership’s/SECOR Master Fund’s Trading Value at Risk~~

~~The~~As ~~following~~of ~~quantitative~~September 30, ~~disclosures~~2017, ~~regarding~~ the Partnership’s~~/SECOR~~ ~~Master~~total ~~Fund’s~~capitalization ~~market risk exposures~~was contain “forward-looking statements” within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933$49, ~~as amended (the “Securities Act”)~~177, ~~and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”))~~349. ~~All quantitative disclosures in this section are deemed to be forward-looking statements for purposes of the safe harbor, except for statements of historical fact.~~

The Partnership/SECOR Master Fund account for open positions on the basis of fair value accounting principles. Any loss in the market value of the Partnership’s/SECOR Master Fund’s open positions are directly reflected in the Partnership’s/SECOR Master Fund’s earnings and cash flow.


September 30, 2017
						Three Months Ended September 30, 2017
			% of Total			High		Low		Average
Market Sector	Value at Risk		Capitalization			Value at Risk		Value at Risk		Value at Risk*
Commodity	$	2,457,628		5.00	%	$	4,085,886	$	1,978,406	$2,752,978
Equity		5,051,306		10.27			5,736,692		4,209,352	5,035,083
Currencies		3,557,258		7.23			6,890,822		3,367,299	4,563,582
Interest rates		1,486,172		3.02			1,961,987		1,116,976	1,451,603

Total	$	12,552,364		25.52	%


* Average of daily Value at Risk.

~~The~~ As ~~Partnership’s/SECOR Master Fund’s risk exposure in the market sectors traded by the Trading Advisors is estimated below in terms~~ of ~~Value~~December 31, at2016, ~~Risk. Please note that~~ the ~~Value~~Partnership’s ~~at Risk model is used to numerically quantify market risk for historic reporting purposes only and is not utilized by either Ceres or the Trading Advisors in their~~total ~~daily~~capitalization ~~risk~~was ~~management activities~~$62,870,541.

“Value at Risk” is a measure of the maximum amount which the Partnership/SECOR Master Fund could reasonably be expected to lose in a given market sector. However, the inherent uncertainty of the Partnership’s/SECOR Master Fund’s speculative trading and the recurrence in the markets traded by the Partnership/SECOR Master Fund of market movements far exceeding expectations could result in actual trading or non-trading losses far beyond the indicated Value at Risk or the Partnership’s/SECOR Master Fund’s experience to date (i.e., “risk of ruin”). In light of the foregoing as well as the risks and uncertainties intrinsic to all future projections, the inclusion of the quantification in this section should not be considered to constitute any assurance or representation that the Partnership’s/SECOR Master Fund’s losses in any market sector will be limited to Value at Risk or by the Partnership’s/SECOR Master Fund’s attempt to manage their market risk.


December 31, 2016
						Twelve Months Ended December 31, 2016
			% of Total			High		Low		Average
Market Sector	Value at Risk		Capitalization			Value at Risk		Value at Risk		Value at Risk*
Commodity	$	2,545,667		4.05	%	$	5,525,458	$	2,210,452	$3,808,206
Equity		4,971,704		7.91			6,941,716		2,923,670	5,401,231
Currencies		6,186,417		9.84			9,171,218		3,350,153	6,071,653
Interest rates		1,900,235		3.02			3,291,761		1,619,014	2,497,709

Total	$	15,604,023		24.82	%

~~Exchange~~* ~~margin~~Annual ~~requirements~~average ~~have been used by the Partnership/SECOR Master Fund as the measure~~ of ~~their~~daily Value at Risk. Margin requirements are set by exchanges to equal or exceed the maximum losses reasonably expected to be incurred in the fair value of any given contract in 95%-99% of any one-day interval. The margin levels are established by dealers and exchanges using historical price studies as well as an assessment of current market volatility (including the implied volatility of the options on a given futures contract) and economic fundamentals to provide a probabilistic estimate of the maximum expected near-term one-day price fluctuation.

~~Value~~24 at Risk tables represent a probabilistic assessment of the risk of loss in market risk sensitive instruments. The Trading Advisors, with exception to SECOR, currently trade the Partnership’s assets directly in managed accounts established in the name of the Partnership, over which they have been granted limited authority to make trading decisions. The following trading Value at Risk tables reflect the market sensitive instruments held by the Partnership and indirectly, through its investments in the SECOR Master Fund. There have been no material changes in the trading Value at Risk information previously disclosed in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2016.

24Item 4. Controls and Procedures.

AsThe ofPartnership’s ~~June 30~~disclosure controls and procedures are designed to ensure that information required to be disclosed by the Partnership on the reports that it files or submits under the Exchange Act is recorded, ~~2017~~processed, summarized and reported within the ~~Partnership~~time periods expected in the SEC’s ~~total~~rules ~~capitalization~~and ~~was~~forms. Disclosure controls and procedures include controls ~~$53~~and procedures designed to ensure that information required to be disclosed by the Partnership in the reports it files is accumulated and communicated to management,~~628~~ including the President and Chief Financial Officer (the “CFO”) of the General Partner,~~989~~ to allow for timely decisions regarding required disclosure and appropriate SEC filings.

~~June 30~~The General Partner is responsible for ensuring that there is an adequate and effective process for establishing, ~~2017~~maintaining and evaluating disclosure controls and procedures for the Partnership’s external disclosures.

						Three Month Ended June 30, 2017
Market Sector	Value at Risk		% of TotalCapitalization			HighValue at Risk		LowValue at Risk		AverageValue at Risk*
Commodity	$	4,277,593		7.98	%	$	4,277,593	$	2,441,907	$	3,250,813
Equity		5,385,498		10.04			5,985,468		4,237,348		5,348,727
Currencies		5,839,015		10.89			7,956,938		5,839,015		6,819,114
Interest rates		1,544,773		2.88			2,404,326		1,173,437		1,859,867
Total	$	17,046,879		31.79	%

The General Partner’s President and CFO have evaluated the effectiveness of the Partnership’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2017, and, based on that evaluation, the General Partner’s President and CFO have concluded that, at that date, the Partnership’s disclosure controls and procedures were effective.

*The ~~Average~~Partnership’s internal control over financial reporting is a process under the supervision of ~~daily~~the ~~Value~~General Partner’s atPresident ~~Risk~~and CFO to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. These controls include policies and procedures that:

As• pertain to the maintenance of ~~December 31~~records, ~~2016~~that in reasonable detail, accurately and fairly reflect the ~~Partnership’s~~transactions ~~total~~and ~~capitalization~~dispositions ~~was~~of ~~$62,870,541.~~the assets of the Partnership;

~~December 31~~• provide reasonable assurance that (i) transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, ~~2016~~and (ii) the Partnership’s receipts are handled and expenditures are made only pursuant to authorizations of the General Partner; and

						Twelve Months Ended December 31, 2016
Market Sector	Value at Risk		% of TotalCapitalization			HighValue at Risk		LowValue at Risk		AverageValue at Risk*
Commodity	$	2,545,667		4.05	%	$	5,525,458	$	2,210,452	$	3,808,206
Equity		4,971,704		7.91			6,941,716		2,923,670		5,401,231
Currencies		6,186,417		9.84			9,171,218		3,350,153		6,071,653
Interest rates		1,900,235		3.02			3,291,761		1,619,014		2,497,709
Total	$	15,604,023		24.82	%

•

provide reasonable assurance regarding prevention or timely detection and correction of unauthorized acquisition, use or disposition of the Partnership’s assets that could have a material effect on the financial statements.

*There ~~Annual~~were ~~average~~no ofchanges ~~daily~~in ~~Value~~the atPartnership’s ~~Risk~~internal control over financial reporting process during the fiscal quarter ended September 30, 2017 that materially affected, or are reasonably likely to materially affect, the Partnership’s internal control over financial reporting.

~~Item~~PART 4II. ~~Controls~~OTHER ~~and~~INFORMATION ~~Procedures.~~

~~The~~Item Partnership’s disclosure controls and procedures are designed to ensure that information required to be disclosed by the Partnership on the reports that it files or submits under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods expected in the SEC’s rules and forms1. ~~Disclosure~~Legal controls and procedures include controls and procedures designed to ensure that information required to be disclosed by the Partnership in the reports it files is accumulated and communicated to management, including the President and Chief Financial Officer (the “CFO”) of the General Partner, to allow for timely decisions regarding required disclosure and appropriate SEC filingsProceedings.

~~The~~This ~~General~~section ~~Partner~~describes isthe ~~responsible~~major ~~for~~pending ~~ensuring~~legal ~~that~~proceedings, ~~there~~other isthan anordinary ~~adequate~~routine ~~and~~litigation ~~effective~~incidental ~~process~~to ~~for establishing~~the business, to ~~maintaining~~which ~~and~~MS&Co. ~~evaluating~~or ~~disclosure~~its ~~controls~~subsidiaries ~~and~~is ~~procedures~~a ~~for~~party or to which any of their property is subject. There are no material legal proceedings pending against the Partnership’s ~~external~~or ~~disclosures~~the General Partner.

~~The~~On ~~General~~June 1, ~~Partner’s~~2011, ~~President~~Morgan ~~and~~Stanley & ~~CFO~~Co. ~~have~~Incorporated ~~evaluated~~converted ~~the~~from ~~effectiveness~~a ofDelaware ~~the~~corporation ~~Partnership’s~~to ~~disclosure~~a ~~controls~~Delaware limited ~~and~~liability ~~procedures~~company. ~~(as~~As ~~defined~~a inresult ~~Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as~~ of ~~June 30, 2017, and, based on~~ that ~~evaluation~~conversion, ~~the~~Morgan ~~General~~Stanley & ~~Partner’s President~~Co. ~~and~~Incorporated ~~CFO~~is ~~have~~now ~~concluded~~named ~~that,~~Morgan atStanley & ~~that~~Co. ~~date,~~LLC ~~the Partnership’s disclosure controls and procedures were effective~~(“MS&Co.”).

~~The~~MS&Co. ~~Partnership’s~~is ~~internal~~a ~~control~~wholly-owned, ~~over~~indirect ~~financial~~subsidiary ~~reporting~~of isMorgan Stanley, a ~~process~~Delaware ~~under~~holding company. Morgan Stanley files periodic reports with the ~~supervision~~SEC as required by the Securities Exchange Act of 1934, as amended (the ~~General~~“Exchange Act”), which include current descriptions of material litigation and material proceedings and investigations, if any, by governmental and/or ~~Partner’s~~regulatory ~~President~~agencies or self-regulatory organizations concerning Morgan Stanley and ~~CFO~~its tosubsidiaries, ~~provide~~including ~~reasonable~~MS&Co. ~~assurance~~As ~~regarding~~a consolidated subsidiary of Morgan Stanley, MS&Co. does not file its own periodic reports with the ~~reliability~~SEC that contain descriptions of ~~financial~~material ~~reporting~~litigation, proceedings and investigations. As a result, we refer you to the ~~preparation~~“Legal Proceedings” section of ~~financial~~Morgan ~~statements~~Stanley’s inSEC ~~accordance~~10-K ~~with~~filings ~~GAAP.~~for ~~These~~2016, ~~controls~~2015, ~~include~~2014, ~~policies~~2013 and ~~procedures~~2012. In addition, MS&Co. annually prepares an Audited, Consolidated Statements of Financial Condition (“Audited Financial Statement”) that: is publicly available on Morgan Stanley’s website at www.morganstanley.com. We refer you to the “Commitments, Guarantees and Contingencies—Contingencies—Legal” section in MS&Co.’s 2016 Audited Financial Statement and MS&Co’s Mid-Year Financials as of June 30, 2017.

•In ~~pertain~~addition to the ~~maintenance~~matters described in those filings, in the normal course of ~~records~~business, ~~that~~each of Morgan Stanley and MS&Co. has been named, from time to time, as a defendant in ~~reasonable~~various ~~detail~~legal actions, ~~accurately~~including arbitrations, class actions, and ~~fairly~~other ~~reflect~~litigation, arising in connection with its activities as a global diversified financial services institution. Certain of the legal ~~transactions~~actions include claims for substantial compensatory and/or ~~dispositions~~punitive damages or claims for indeterminate amounts of ~~the~~damages. ~~assets~~Each of ~~the~~Morgan ~~Partnership;~~Stanley and MS&Co. is also involved, from time to time, in investigations and proceedings by governmental and/or regulatory agencies or self-regulatory organizations, certain of which may result in adverse judgments, fines or penalties. The number of these investigations and proceedings has increased in recent years with regard to many financial services institutions, including Morgan Stanley and MS&Co.

•MS&Co. ~~provide~~is ~~reasonable~~a ~~assurance~~Delaware ~~that~~limited ~~(i)~~liability company ~~transactions~~with ~~are~~its ~~recorded~~main asbusiness ~~necessary~~office tolocated ~~permit~~at ~~preparation~~1585 ofBroadway, ~~financial~~New ~~statements~~York, inNew ~~accordance~~York ~~with~~10036. ~~GAAP,~~Among ~~and~~other ~~(ii)~~registrations ~~the~~and ~~Partnership’s~~memberships, ~~receipts~~MS&Co. ~~are~~is ~~handled~~registered ~~and~~as ~~expenditures~~a ~~are~~futures ~~made~~commission ~~only~~merchant ~~pursuant~~and tois ~~authorizations~~a member of the ~~General~~National ~~Partner;~~Futures ~~and~~Association.

•Regulatory ~~provide reasonable assurance regarding prevention or timely detection~~ and ~~correction~~Governmental ~~of unauthorized acquisition, use or disposition of the Partnership’s assets that could have a material effect on the financial statements.~~Matters

~~There~~MS&Co. ~~were~~has noreceived ~~changes~~subpoenas inand requests for information from certain federal and state regulatory and governmental entities, including among others various members of the ~~Partnership’s~~RMBS ~~internal~~Working ~~control~~Group ~~over~~of ~~financial~~the ~~reporting~~Financial ~~process~~Fraud ~~during~~Enforcement Task Force, such as the ~~fiscal~~United ~~quarter~~States Department of Justice, Civil Division and several state Attorney General’s Offices, concerning ~~ended~~the ~~June 30~~origination, ~~2017~~financing, ~~that~~purchase, ~~materially~~securitization ~~affected~~and servicing of subprime and non-subprime residential mortgages and related matters such as residential mortgage backed securities (“RMBS”), collateralized debt obligations (“CDOs”), structured investment vehicles (“SIVs”) and credit default swaps backed by or referencing mortgage pass-through certificates. These matters, some of which are ~~reasonably~~in ~~likely~~advanced tostages, ~~materially~~include, ~~affect~~but are not limited to, investigations related to MS&Co.’s due diligence on the ~~Partnership~~loans that it purchased for securitization, MS&Co.’s ~~internal~~communications ~~control~~with ~~over~~ratings ~~financial~~agencies, ~~reporting~~MS&Co.’s disclosures to investors, and MS&Co.’s handling of servicing and foreclosure related issues.

26On February 25, 2015, MS&Co. reached an agreement in principle with the United States Department of Justice, Civil Division and the United States Attorney’s Office for the Northern District of California, Civil Division (collectively, the “Civil Division”) to pay $2.6 billion to resolve certain claims that the Civil Division indicated it intended to bring against MS&Co. That settlement was finalized on February 10, 2016.

~~PART~~In IIOctober 2014, the Illinois Attorney General’s Office (“ILAG”) sent a letter to MS&Co. ~~OTHER~~alleging ~~INFORMATION~~that MS&Co. knowingly made misrepresentations related to RMBS purchased by certain pension funds affiliated with the State of Illinois and demanding that MS&Co. pay ILAG approximately $88 million. MS&Co. and ILAG reached an agreement to resolve the matter on February 10, 2016.

~~Item~~26 ~~1. Legal Proceedings.~~

~~This~~On ~~section~~January 13, ~~describes~~2015, the ~~major~~New ~~pending legal~~York ~~proceedings,~~Attorney ~~other~~General’s ~~than~~Office (“NYAG”), ~~ordinary~~which ~~routine~~is ~~litigation~~also ~~incidental~~a tomember of the ~~business~~RMBS Working Group, indicated that it intended to ~~which~~file a lawsuit related to approximately 30 subprime securitizations sponsored by MS&Co. orNYAG ~~its~~indicated ~~subsidiaries~~that isthe alawsuit ~~party~~would allege that MS&Co. misrepresented or omitted material information related to ~~which~~the ~~any~~due diligence, underwriting and valuation of ~~their~~the ~~property~~loans isin ~~subject.~~the ~~There~~securitizations ~~are~~and nothe ~~material~~properties ~~legal~~securing ~~proceedings~~them ~~pending~~and ~~against~~indicated that its lawsuit would be brought under the Martin ~~Partnership~~Act. orMS&Co. and NYAG reached an agreement to resolve the ~~General~~matter ~~Partner~~on February 10, 2016.

On June 15, ~~2011~~2012, MS&Co. ~~Morgan~~consented ~~Stanley &~~to Coand became the subject of an Order Instituting Proceedings Pursuant to Sections 6(c) and 6(d) of the Commodity Exchange Act, as amended, Making Findings and Imposing Remedial Sanctions by The Commodity Futures Trading Commission (CFTC) to resolve allegations related to the failure of a salesperson to comply with exchange rules that prohibit off-exchange futures transactions unless there is an Exchange for Related Position (“EFRP”). ~~Incorporated~~Specifically, ~~converted~~the CFTC found that from April 2008 through October 2009, MS&Co. violated Section 4c(a) of the Commodity Exchange Act, as amended (the “CEA”) and CFTC Regulation 1.38 by executing, processing and reporting numerous off-exchange ~~Delaware~~futures ~~corporation~~trades to athe ~~Delaware~~Chicago ~~limited~~Mercantile ~~liability~~Exchange ~~company~~(“CME”) and Chicago Board of Trade (“CBOT”) as EFRPs in violation of CME and CBOT rules because those trades lacked the corresponding and related cash, OTC swap, OTC option, or other OTC derivative position. AsIn addition, the CFTC found that MS&Co. violated CFTC Regulation 166.3 by failing to supervise the handling of the trades at issue and failing to have adequate policies and procedures designed to detect and deter the violations of the CEA and CFTC Regulations. Without admitting or denying the underlying allegations and without adjudication of any issue of law or fact, MS&Co. accepted and consented to entry of findings and the imposition of a ~~result~~cease and desist order, a fine of ~~that~~$5,000,000, ~~conversion~~and undertakings related to public statements, ~~Morgan~~cooperation ~~Stanley~~ and payment of the fine. MS&Co. entered into corresponding and related settlements with the CME and CBOT in which the CME found that MS&Co. violated ~~Incorporated~~CME isRules ~~now~~432.Q ~~named~~and ~~Morgan~~538 ~~Stanley~~ and fined MS&Co. $750,000 and CBOT found that MS&Co. ~~LLC~~violated (“CBOT Rules 432.Q and 538 and fined MS&Co.”) $1,000,000.

~~MS&Co.~~On ~~is a wholly-owned~~July 23, ~~indirect subsidiary of Morgan Stanley~~2014, ~~a Delaware holding company. Morgan Stanley files periodic reports with~~ the SEC asapproved ~~required~~a settlement by ~~the~~MS&Co. ~~Securities~~and ~~Exchange~~certain ~~Act~~affiliates ofto ~~1934,~~resolve asan ~~amended~~investigation ~~(the~~related to ~~“Exchange~~certain ~~Act”),~~subprime ~~which~~RMBS ~~include~~transactions ~~current~~sponsored ~~descriptions of material litigation~~ and ~~material~~underwritten ~~proceedings and investigations, if any,~~ by ~~governmental~~those ~~and/or regulatory~~entities ~~agencies~~in ~~or self-regulatory organizations concerning Morgan Stanley and its subsidiaries, including MS&Co~~2007. Pursuant Asto athe ~~consolidated subsidiary of Morgan Stanley~~settlement, MS&Co. ~~does~~and ~~not~~certain ~~file~~affiliates ~~its~~were ~~own~~charged ~~periodic reports~~ with ~~the~~violating ~~SEC~~Sections ~~that~~17(a)(2) ~~contain descriptions of material litigation, proceedings~~ and ~~investigations. As~~ 17(a)(3) ~~result,~~of ~~we refer you to~~ the ~~“Legal~~Securities ~~Proceedings”~~Act ~~section~~ of ~~Morgan Stanley’s SEC 10-K filings for 2016~~1933, ~~2015, 2014, 2013,~~ ~~and~~as ~~2012.~~amended ~~In addition, MS&Co. annually prepares an Audited Consolidated Statements of Financial Condition~~ (the “~~Audited~~Securities ~~Financial Statement~~Act”), ~~that~~agreed isto ~~publicly~~pay ~~available~~disgorgement onand ~~Morgan~~penalties ~~Stanley’s~~in ~~website~~an atamount ~~www.morganstanley.com.~~of We$275 ~~refer~~million ~~you~~and toneither ~~the~~admitted ~~“Commitments,~~nor ~~Guarantees~~denied ~~and~~the ~~Contingencies—Contingencies—Legal” section in MS&Co.~~SEC’s ~~2016 Audited Financial Statement~~findings.

InOn ~~addition~~April 21, to2015, the ~~matters~~Chicago ~~described~~Board inOptions ~~those filings~~Exchange, inIncorporated (“CBOE”) and the ~~normal~~ ~~course~~CBOE ofFutures ~~business~~Exchange, ~~each~~LLC (“CFE”) offiled ~~Morgan~~statements ~~Stanley~~of ~~and~~charges against MS&Co. ~~has been named, from time to time, as a defendant~~ in ~~various legal actions, including arbitrations, class actions, and other litigation, arising in~~ connection with ~~its~~trading ~~activities~~by asone ~~a global~~of ~~diversified financial services institution~~MS&Co.’s ~~Certain~~former traders of ~~the~~EEM ~~legal~~options ~~actions~~contracts ~~include~~that ~~claims~~allegedly ~~for~~disrupted ~~substantial~~the ~~compensatory~~final ~~and/or~~settlement ~~punitive~~price ~~damages~~of orthe ~~claims~~November ~~for~~2012 ~~indeterminate amounts of damages~~VXEM futures. CBOE ~~Each~~alleged ofthat ~~Morgan Stanley and~~ MS&Co. isviolated ~~also involved,~~CBOE ~~from~~Rules ~~time~~4.1, to4.2 ~~time~~and 4.7, inSections ~~investigations~~9(a) and ~~proceedings~~10(b) byof ~~governmental~~the ~~and/or~~Exchange ~~regulatory~~Act, ~~agencies~~and orRule ~~self~~10b-~~regulatory~~5 ~~organizations,~~thereunder. CFE ~~certain~~alleged ofthat ~~which~~MS&Co. ~~may~~violated ~~result~~CFE inRules ~~adverse judgments~~608, ~~fines~~609 orand ~~penalties~~620. The ~~number~~matters ~~of these investigations and~~were ~~proceedings~~resolved ~~has~~on ~~increased in recent years with regard to many financial services institutions~~June 28, ~~including~~2016 ~~Morgan~~without ~~Stanley~~any ~~and~~findings ~~MS&Co~~of fraud.

On June 18, 2015, MS&Co. isentered into a ~~Delaware limited liability company~~ settlement with ~~its~~the ~~main~~SEC ~~business~~and ~~office~~paid ~~located~~a atfine ~~1585~~of ~~Broadway~~$500,000 ~~New~~as ~~York,~~part ~~New~~of ~~York 10036.~~the ~~Among~~MCDC ~~other~~Initiative ~~registrations~~to ~~and~~resolve ~~memberships,~~allegations that MS&Co. isfailed ~~registered~~to asform a ~~futures~~reasonable ~~commission~~basis ~~merchant~~through ~~and~~adequate isdue adiligence ~~member~~for believing the truthfulness of the ~~National~~assertions ~~Futures~~by ~~Association~~issuers and/or obligors regarding their compliance with previous continuing disclosure undertakings pursuant to Rule 15c2-12 in connection with offerings in which MS&Co. acted as senior or sole underwriter.

~~Regulatory~~On August 6, 2015, MS&Co. consented to and ~~Governmental~~became ~~Matters~~the subject of an order by the CFTC to resolve allegations that MS&Co. violated CFTC Regulation 22.9(a) by failing to hold sufficient US Dollars in cleared swap segregated accounts in the United States to meet all US Dollar obligations to cleared swaps customers. Specifically, the CFTC found that while MS&Co. at all times held sufficient funds in segregation to cover its obligations to its customers, on certain days during 2013 and 2014, it held currencies, such as euros, instead of US dollars, to meet its US dollar obligations. In addition, the CFTC found that MS&Co. violated CFTC Regulation 166.3 by failing to have in place adequate procedures to ensure that it complied with CFTC Regulation 22.9(a). Without admitting or denying the findings or conclusions and without adjudication of any issue of law or fact, MS&Co. accepted and consented to the entry of findings, the imposition of a cease and desist order, a civil monetary penalty of $300,000, and undertakings related to public statements, cooperation, and payment of the monetary penalty.

~~MS&Co.~~27 has received subpoenas and requests for information from certain federal and state regulatory and governmental entities, including among others various members of the RMBS Working Group of the Financial Fraud Enforcement Task Force, such as the United States Department of Justice, Civil Division and several state Attorney General’s Offices, concerning the origination, financing, purchase, securitization and servicing of subprime and non-subprime residential mortgages and related matters such as residential mortgage backed securities (“RMBS”), collateralized debt obligations (“CDOs”), structured investment vehicles (“SIVs”) and credit default swaps backed by or referencing mortgage pass-through certificates. These matters, some of which are in advanced stages, include, but are not limited to, investigations related to MS&Co.’s due diligence on the loans that it purchased for securitization, MS&Co.’s communications with ratings agencies, MS&Co.’s disclosures to investors, and MS&Co.’s handling of servicing and foreclosure related issues.

On ~~February~~December 2520, ~~2015~~2016, MS&Co. ~~reached~~consented to and became the subject of an ~~agreement~~order by the SEC in ~~principle~~connection with ~~the~~allegations ~~United~~that ~~States~~MS&Co. ~~Department~~willfully violated Sections 15(c)(3) and 17(a)(1) of ~~Justice,~~the ~~Civil~~Exchange ~~Division~~Act and ~~the~~Rules ~~United~~15c3-3(e), ~~States~~17a-5(a), ~~Attorney’s~~and ~~Office~~17a-5(d) ~~for~~thereunder, ~~the~~by ~~Northern~~inaccurately ~~District~~calculating ofits ~~California,~~Reserve ~~Civil~~Account ~~Division~~requirement under ~~(collectively~~Rule 15c3-3 by including margin loans to an affiliate in its calculations, ~~the~~which ~~“Civil~~resulted ~~Division”)~~in making inaccurate records and submitting inaccurate reports to ~~pay $2~~the SEC.6 ~~billion~~Without toadmitting ~~resolve~~or ~~certain~~denying ~~claims~~the ~~that~~underlying ~~the~~allegations ~~Civil~~and ~~Division~~without adjudication ~~indicated~~of itany ~~intended~~issue toof ~~bring~~law ~~against~~or fact, MS&Co. ~~That~~consented ~~settlement~~to ~~was~~a ~~finalized~~cease onand ~~February 10~~desist order, ~~2016~~a censure, and a civil monetary penalty of $7,500,000.

InOn ~~October~~September ~~2014~~28, 2017, the ~~Illinois~~CFTC ~~Attorney~~issued ~~General’s~~an ~~Office~~order ~~(“ILAG”)~~filing ~~sent~~and asimultaneously ~~letter~~settling tocharges against MS&Co. ~~alleging that~~regarding ~~MS&Co.~~violations ~~knowingly~~of ~~made~~CFTC ~~misrepresentations~~Rule ~~related~~166.3 by failing to ~~RMBS~~diligently ~~purchased~~supervise bythe ~~certain~~reconciliation ~~pension~~of ~~funds~~exchange ~~affiliated~~and clearing fees with the ~~State~~amounts ofit ~~Illinois~~ultimately ~~and~~charged ~~demanding~~customers ~~that~~for ~~MS&Co.~~certain ~~pay~~transactions ~~ILAG~~on ~~approximately~~multiple ~~$88 million~~exchanges. The order and settlement required MS&Co. ~~and~~to ~~ILAG~~pay ~~reached~~a an$500,000 ~~agreement~~penalty ~~to resolve~~and ~~the~~cease ~~matter~~and ondesist ~~February 10,~~from ~~2016~~violating Rule 166.3.

27On November 2, 2017, the CFTC issued an order filing and simultaneously settling charges against MS&Co. for non-compliance with applicable rules governing Part 17 Large Trader reports to the CFTC. The order requires MS&Co. to pay a $350,000 penalty and cease and desist from further violations of the Commodity Exchange Act.

OnCivil ~~January 13,~~Litigation 2015, the New York Attorney General’s Office (“NYAG”), which is also a member of the RMBS Working Group, indicated that it intended to file a lawsuit related to approximately 30 subprime securitizations sponsored by MS&Co. NYAG indicated that the lawsuit would allege that MS&Co. misrepresented or omitted material information related to the due diligence, underwriting and valuation of the loans in the securitizations and the properties securing them and indicated that its lawsuit would be brought under the Martin Act. MS&Co. and NYAG reached an agreement to resolve the matter on February 10, 2016.

On ~~June~~July 515, ~~2012~~2010, ~~MS&Co.~~ ~~consented~~China toDevelopment ~~and~~Industrial ~~became~~Bank ~~the subject of an Order Instituting Proceedings Pursuant to Sections 6~~(c“CDIB”) ~~and~~filed ~~6(d)~~a ofcomplaint ~~the~~against ~~Commodity Exchange Act~~MS&Co., asstyled China ~~amended,~~Development ~~Making~~Industrial ~~Findings~~Bank ~~and~~v. ~~Imposing~~Morgan ~~Remedial~~Stanley & ~~Sanctions~~Co. byIncorporated ~~The~~et ~~Commodity~~al., ~~Futures~~which ~~Trading Commission~~is ~~(CFTC)~~pending toin ~~resolve~~the ~~allegations~~Supreme ~~related~~Court toof the ~~failure~~State of aNew ~~salesperson~~York, toNew ~~comply~~York ~~with~~County ~~exchange~~(“Supreme ~~rules~~Court ~~that~~of ~~prohibit off-exchange futures transactions unless there is an Exchange for Related Position (“EFRP~~NY”). ~~Specifically,~~The ~~the~~complaint ~~CFTC~~relates ~~found~~to ~~that~~a $275 million ~~from~~credit ~~April~~default ~~2008~~swap ~~through~~referencing ~~October~~the ~~2009,~~super ~~MS&Co.~~senior ~~violated~~portion ~~Section 4c(a)~~ of the ~~Commodity~~STACK ~~Exchange~~2006-1 ~~Act,~~CDO. asThe ~~amended~~complaint ~~(the~~asserts ~~“CEA”)~~claims ~~and~~for ~~CFTC~~common ~~Regulation~~law ~~1.38 by executing~~fraud, ~~processing~~fraudulent inducement and ~~reporting~~ ~~numerous~~fraudulent ~~off-exchange~~concealment ~~futures trades to the Chicago Mercantile Exchange (“CME”)~~ and ~~Chicago~~alleges ~~Board~~that ofMS&Co. ~~Trade~~misrepresented ~~(“CBOT”)~~the risks ~~as EFRPs in violation~~ of ~~CME and CBOT rules because those trades lacked~~ the ~~corresponding~~STACK ~~and~~2006-1 ~~related~~CDO ~~cash,~~to ~~OTC swap~~CDIB, ~~OTC~~and ~~option, or other OTC derivative position. In addition, the CFTC found~~ that MS&Co. ~~violated~~knew ~~CFTC~~that ~~Regulation 166.3 by failing to supervise~~ the ~~handling~~assets ofbacking the ~~trades~~CDO atwere ~~issue~~of ~~and failing~~poor toquality ~~have~~when ~~adequate~~it ~~policies~~entered ~~and~~into ~~procedures designed to detect and deter~~ the ~~violations~~credit ofdefault ~~the~~swap ~~CEA~~with ~~and CFTC Regulations~~CDIB. ~~Without~~The ~~admitting~~complaint orseeks ~~denying~~compensatory ~~the~~damages ~~underlying~~related ~~allegations~~to ~~and~~the ~~without~~approximately ~~adjudication~~$228 million ofthat ~~any~~CDIB ~~issue~~alleges ofit ~~law~~has oralready ~~fact,~~lost ~~MS&Co. accepted~~under ~~and~~the ~~consented~~credit todefault ~~entry~~swap, ofrescission ~~findings and the imposition~~ of aCDIB’s ~~cease~~obligation ~~and~~to ~~desist~~pay ~~order,~~an aadditional ~~fine of~~ $512 million,~~000,000,~~ ~~and~~punitive ~~undertakings~~damages, ~~related~~equitable ~~to public statements~~relief, ~~cooperation~~fees and ~~payment~~costs. On ofFebruary 28, 2011, the ~~fine.~~court denied MS&Co.’s ~~entered~~motion ~~into~~to ~~corresponding~~dismiss ~~and related settlements with~~ the ~~CME~~complaint. ~~and~~Based ~~CBOT~~on incurrently ~~which~~available ~~the~~information, ~~CME found that~~ MS&Co. ~~violated~~believes ~~CME~~it ~~Rules~~could ~~432.Q~~incur ~~and~~a ~~538~~loss ~~and~~of ~~fined~~up ~~MS&Co.~~to approximately $~~750,000~~240 ~~and~~million ~~CBOT~~plus ~~found~~pre- ~~that~~and ~~MS&Co.~~post-judgment ~~violated~~interest, ~~CBOT~~fees ~~Rules 432.Q~~ and ~~538 and fined MS&Co~~costs. ~~$1,000,000.~~

On ~~July~~October 2315, ~~2014~~2010, the ~~SEC~~Federal ~~approved~~Home aLoan ~~settlement~~Bank byof Chicago filed a complaint against MS&Co. and ~~certain~~other defendants ~~affiliates~~in the Circuit toCourt ~~resolve~~of anthe ~~investigation~~State ~~related~~of Illinois, styled Federal Home Loan Bank of Chicago v. Bank of America Funding Corporation et al. A corrected amended complaint was filed on April 8, 2011, which alleges that defendants made untrue statements and material omissions in the sale to ~~certain~~plaintiff ~~subprime~~of a ~~RMBS~~number ~~transactions~~of mortgage ~~sponsored~~pass-through certificates backed by securitization trusts containing residential mortgage loans and ~~underwritten~~asserts claims under Illinois law. The total amount of certificates allegedly sold to plaintiff by ~~those~~MS&Co. ~~entities~~at issue in ~~2007~~the action was approximately $203 million. The complaint seeks, among other things, ~~Pursuant~~to rescind the plaintiff’s purchase of such certificates. The defendants filed a motion to dismiss the ~~settlement~~corrected amended complaint on May 27, 2011, which was denied on September 19, 2012. On December 13, 2013, the court entered an order dismissing all claims related to one of the securitizations at issue. After that dismissal, the remaining amount of certificates allegedly issued by MS&Co. ~~and~~or ~~certain~~sold ~~affiliates~~to ~~were~~plaintiff ~~charged~~by ~~with~~MS&Co. ~~violating~~was ~~Sections~~approximately ~~17(a)(2)~~$78 ~~and~~million. ~~17(a)(3)~~At ofSeptember 25, 2017, the ~~Securities~~current unpaid ~~Act~~balance of ~~1933~~the mortgage pass-through certificates at issue in this action was approximately $45 million, and the certificates had not yet incurred actual losses. Based on currently available information, MS&Co. believes it could incur a asloss ~~amended~~in (this action up to the ~~“Securities~~difference ~~Act”~~between the $45 million unpaid balance of these certificates (plus any losses incurred) and their fair market value at the time of a judgment against MS&Co., ~~agreed~~plus topre- ~~pay~~and ~~disgorgement~~post-judgment interest, fees and costs. ~~penalties~~MS&Co. inmay anbe ~~amount~~entitled to be indemnified for some of ~~$275 million~~these losses and ~~neither~~to ~~admitted~~an ~~nor~~offset ~~denied~~for interest received by the ~~SEC’s~~plaintiff ~~findings~~prior to a judgment.

On April 21, 2015, the Chicago Board Options Exchange, Incorporated (“CBOE”) and the CBOE Futures Exchange, LLC (“CFE”) filed statements of charges against MS&Co. in connection with trading by one of MS&Co.’s former traders of EEM options contracts that allegedly disrupted the final settlement price of the November 2012 VXEM futures. CBOE alleged that MS&Co. violated CBOE Rules 4.1, 4.2 and 4.7, Sections 9(a) and 10(b) of the Exchange Act, and Rule 10b-5 thereunder. CFE alleged that MS&Co. violated CFE Rules 608, 609 and 620. The matters were resolved on June 28, ~~2016 without any findings of fraud.~~

On ~~June~~April 1820, ~~2015~~2011, the Federal Home Loan Bank of Boston filed a complaint against MS&Co. ~~entered~~and ~~into~~other adefendants ~~settlement~~in ~~with~~the Superior Court of the ~~SEC~~Commonwealth of Massachusetts styled Federal Home Loan Bank of Boston v. Ally Financial, Inc. F/K/A GMAC LLC et al. An amended complaint was filed on June 29, 2012 and alleges ~~paid~~that adefendants ~~fine~~made untrue statements and material omissions in the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly issued by MS&Co. or sold to plaintiff by MS&Co. was approximately $~~500~~385 million. The amended complaint raises claims under the Massachusetts Uniform Securities Act,~~000~~ asthe ~~part~~Massachusetts Consumer Protection Act and common law and seeks, among other things, to rescind the plaintiff’s purchase of such certificates. On May 26, 2011, defendants removed the ~~MCDC~~case ~~Initiative~~to the United States District Court for the District of Massachusetts. The defendants’ motions to ~~resolve~~dismiss ~~allegations~~the amended ~~that~~complaint were granted in part and denied in part on September 30, 2013. On November 25, 2013, July 16, 2014, and May 19, 2015, respectively, the plaintiff voluntarily dismissed its claims against MS&Co. ~~failed~~with respect to ~~form~~three aof ~~reasonable~~the ~~basis~~securitizations ~~through~~at ~~adequate~~issue. ~~due~~After ~~diligence~~these ~~for~~voluntary ~~believing~~dismissals, the ~~truthfulness~~remaining amount of ~~the~~ ~~assertions~~certificates allegedly issued by ~~issuers~~MS&Co. ~~and/~~or ~~obligors~~sold ~~regarding~~to ~~their~~plaintiff ~~compliance~~by ~~with~~MS&Co. ~~previous~~was ~~continuing~~approximately ~~disclosure~~$332 ~~undertakings~~million. ~~pursuant~~On February 6, 2017, the action was remanded to ~~Rule~~the ~~15c2~~Superior Court of the Commonwealth of Massachusetts. At September 25, 2017, the current unpaid balance of the mortgage pass-12through certificates at issue in ~~connection~~this ~~with~~action ~~offerings~~was inapproximately ~~which~~$47 million, and the certificates had not yet incurred actual losses. Based on currently available information, MS&Co. ~~acted~~believes asit ~~senior~~could incur a loss in this action up to the difference between the $47 million unpaid balance of these certificates (plus any losses incurred) and their fair market value at the time of a judgment against MS&Co., or ~~sole~~upon ~~underwriter~~sale, plus pre- and post-judgment interest, fees and costs. MS&Co. may be entitled to be indemnified for some of these losses and to an offset for interest received by the plaintiff prior to a judgment.

On ~~August~~May 63, ~~2015~~2013, plaintiffs in Deutsche Zentral-Genossenschaftsbank AG et al. v. Morgan Stanley et al. filed a complaint against MS&Co., ~~consented~~certain toaffiliates, and ~~became~~other defendants in the ~~subject~~Supreme Court of anNY. ~~order~~The bycomplaint alleges that defendants made material misrepresentations and omissions in the ~~CFTC~~sale to plaintiffs of ~~resolve~~certain ~~allegations~~mortgage ~~that~~pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly sponsored, underwritten and/or sold by MS&Co. ~~violated~~to ~~CFTC~~plaintiff ~~Regulation~~was 22approximately $644 million.~~9(a)~~ byThe ~~failing~~complaint toalleges ~~hold~~causes ~~sufficient~~of USaction ~~Dollars~~against inMS&Co. ~~cleared~~for ~~swap~~common ~~segregated~~law ~~accounts~~fraud, infraudulent ~~the~~concealment, ~~United~~aiding ~~States~~and toabetting ~~meet~~fraud, ~~all~~negligent ~~US Dollar~~misrepresentation, ~~obligations~~and torescission ~~cleared~~and ~~swaps~~seeks, ~~customers.~~among ~~Specifically~~other things, compensatory and punitive damages. On June 10, 2014, the ~~CFTC~~court ~~found~~granted ~~that~~in ~~while~~part and denied in part MS&Co.’s atmotion ~~all~~to ~~times~~dismiss ~~held~~the ~~sufficient~~complaint. ~~funds~~On inJune 20, ~~segregation~~2017 tothe ~~cover~~Appellate ~~its~~Division, ~~obligations~~First toDepartment, ~~its~~affirmed ~~customers,~~the onlower ~~certain~~court’s ~~days~~June 10, ~~during~~2014 ~~2013~~order. ~~and~~On July 28, ~~2014~~2017, itMS&Co. ~~held~~filed ~~currencies,~~a ~~such~~motion asfor ~~euros,~~leave ~~instead~~to ofappeal USthat ~~dollars,~~decision to ~~meet~~the ~~its~~New USYork ~~dollar obligations~~Court of Appeals. InOn ~~addition~~October 3, 2017, the ~~CFTC~~Appellate ~~found~~Division, ~~that~~First Department denied MS&Co.’s ~~violated~~motion ~~CFTC~~for ~~Regulation~~leave ~~166~~to appeal.3 At September 25, by2017, ~~failing~~the tocurrent ~~have~~unpaid inbalance ~~place~~of ~~adequate~~the ~~procedures~~mortgage topass-through ~~ensure~~certificates ~~that~~at itissue ~~complied~~in ~~with~~this ~~CFTC~~action ~~Regulation~~was ~~22.9(a).~~approximately $232 ~~Without~~million, ~~admitting~~and ~~or denying~~ the ~~findings~~certificates ~~or conclusions~~had ~~and~~incurred ~~without~~actual ~~adjudication~~losses of ~~any~~approximately ~~issue~~$87 million. ofBased ~~law~~on currently oravailable ~~fact~~information, MS&Co. ~~accepted~~believes ~~and~~it ~~consented~~could incur a loss in this action up to the ~~entry~~difference ofbetween ~~findings,~~ the ~~imposition~~$232 million unpaid balance of athese ~~cease~~certificates (plus any losses incurred) and ~~desist~~their ~~order,~~fair amarket ~~civil~~value ~~monetary~~at ~~penalty~~the time of ~~$300~~a judgment against MS&Co.,~~000~~ or upon sale, ~~and~~plus ~~undertakings~~pre- ~~related~~and topost-judgment ~~public statements~~interest, ~~cooperation,~~fees and ~~payment~~costs. ofMS&Co. ~~the~~may ~~monetary~~be ~~penalty~~entitled to be indemnified for some of these losses.

28On May 17, 2013, plaintiff in IKB International S.A. in Liquidation, et al. v. Morgan Stanley, et al. filed a complaint against MS&Co. and certain affiliates in the Supreme Court of NY. The complaint alleges that defendants made material misrepresentations and omissions in the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly sponsored, underwritten and/or sold by MS&Co. to plaintiff was approximately $132 million. The complaint alleges causes of action against MS&Co. for common law fraud, fraudulent concealment, aiding and abetting fraud, and negligent misrepresentation, and seeks, among other things, compensatory and punitive damages. On October 29, 2014, the court granted in part and denied in part MS&Co.’s motion to dismiss. All claims regarding four certificates were dismissed. After these dismissals, the remaining amount of certificates allegedly issued by MS&Co. or sold to plaintiff by MS&Co. was approximately $116 million. On August 26, 2015, MS&Co. perfected its appeal from the court’s October 29, 2014 decision. On August 11, 2016, the Appellate Division, First Department affirmed the trial court’s decision denying in part MS&Co.’s motion to dismiss the complaint. At September 25, 2017, the current unpaid balance of the mortgage pass-through certificates at issue in this action was approximately $25 million, and the certificates had incurred actual losses of $58 million. Based on currently available information, MS&Co. believes it could incur a loss in this action up to the difference between the $25 million unpaid balance of these certificates (plus any losses incurred) and their fair market value at the time of a judgment against MS&Co., or upon sale, plus pre- and post-judgment interest, fees and costs. MS&Co. may be entitled to be indemnified for some of these losses and to an offset for interest received by the plaintiff prior to a judgment.

On29 December 20, 2016, MS&Co. consented to and became the subject of an order by the SEC in connection with allegations that MS&Co. willfully violated Sections 15(c)(3) and 17(a)(1) of the Exchange Act and Rules 15c3-3(e), 17a-5(a), and 17a-5(d) thereunder, by inaccurately calculating its Reserve Account requirement under Rule 15c3-3 by including margin loans to an affiliate in its calculations, which resulted in making inaccurate records and submitting inaccurate reports to the SEC. Without admitting or denying the underlying allegations and without adjudication of any issue of law or fact, MS&Co. consented to a cease and desist order, a censure, and a civil monetary penalty of $7,500,000.

~~Civil~~On ~~Litigation~~April 1, 2016, the California Attorney General’s Office filed an action against MS&Co. in California state court styled California v. Morgan Stanley, et al., on behalf of California investors, including the California Public Employees’ Retirement System and the California Teachers’ Retirement System. The complaint alleges that MS&Co. made misrepresentations and omissions regarding residential mortgage-backed securities and notes issued by the Cheyne SIV, and asserts violations of the California False Claims Act and other state laws and seeks treble damages, civil penalties, disgorgement, and injunctive relief. On September 30, 2016, the court granted MS&Co.’s demurrer, with leave to replead. On October 21, 2016, the California Attorney General filed an amended complaint. On January 25, 2017, the court denied MS&Co.’s demurrer with respect to the amended complaint.

OnSettled ~~July 15, 2010, China Development Industrial Bank (“CDIB”) filed a complaint against MS&Co., styled~~Civil ~~China~~Litigation Development Industrial Bank v. Morgan Stanley & Co. Incorporated et al., which is pending in the Supreme Court of the State of New York, New York County (“Supreme Court of NY”). The complaint relates to a $275 million credit default swap referencing the super senior portion of the STACK 2006-1 CDO. The complaint asserts claims for common law fraud, fraudulent inducement and fraudulent concealment and alleges that MS&Co. misrepresented the risks of the STACK 2006-1 CDO to CDIB, and that MS&Co. knew that the assets backing the CDO were of poor quality when it entered into the credit default swap with CDIB. The complaint seeks compensatory damages related to the approximately $228 million that CDIB alleges it has already lost under the credit default swap, rescission of CDIB’s obligation to pay an additional $12 million, punitive damages, equitable relief, fees and costs. On February 28, 2011, the court denied MS&Co.’s motion to dismiss the complaint. Based on currently available information, MS&Co. believes it could incur a loss of up to approximately $240 million plus pre- and post-judgment interest, fees and costs.

On ~~October~~ August 1525, ~~2010~~2008, ~~the~~ ~~Federal Home Loan Bank of Chicago filed a complaint against~~ MS&Co. and ~~other~~two ~~defendants~~ratings ~~in the Circuit~~agencies ~~Court~~were ofnamed ~~the~~as ~~State~~defendants ofin ~~Illinois,~~a ~~styled Federal Home Loan Bank~~purported ~~of Chicago v. Bank~~class ofaction ~~America~~related ~~Funding~~to ~~Corporation et~~securities ~~al.~~issued Aby ~~corrected~~a ~~amended~~structured ~~complaint~~investment ~~was~~vehicle ~~filed~~called onCheyne ~~April 8,~~Finance ~~2011,~~PLC ~~which alleges that defendants made untrue statements~~ and ~~material~~Cheyne ~~omissions~~Finance inLLC (together, the ~~sale~~“Cheyne toSIV”). ~~plaintiff~~The ~~of a~~case ~~number~~was ~~of mortgage~~styled ~~pass-through~~Abu ~~certificates~~Dhabi ~~backed~~Commercial byBank, ~~securitization~~et ~~trusts~~al. ~~containing residential mortgage loans and asserts claims under Illinois law~~v. ~~The total amount~~ ~~of certificates allegedly sold to plaintiff by MS~~Morgan Stanley & Co. atInc., ~~issue~~et ~~in the action was approximately $203 million~~al. The complaint ~~seeks~~alleged, among other things, to ~~rescind~~ that the ~~plaintiff’s~~ratings ~~purchase~~assigned ~~of such certificates. The defendants filed a motion~~ to ~~dismiss~~ the ~~corrected~~securities ~~amended~~issued ~~complaint~~by onthe ~~May 27,~~Cheyne ~~2011,~~SIV ~~which~~were ~~was~~false ~~denied~~and ~~on September 19~~misleading, ~~2012.~~including Onbecause ~~December 13, 2013,~~ the ~~court~~ratings ~~entered~~did annot ~~order~~accurately ~~dismissing~~reflect ~~all claims related to one of~~ the ~~securitizations~~risks atassociated ~~issue.~~with ~~After that dismissal,~~ the ~~remaining~~subprime ~~amount~~residential ofmortgage ~~certificates~~backed ~~allegedly~~securities ~~issued~~held by ~~MS&Co.~~the orCheyne ~~sold to plaintiff by MS&Co~~SIV. ~~was~~The ~~approximately~~plaintiffs ~~$78 million.~~asserted Atallegations ~~June 25, 2017, the current unpaid balance~~ of ~~the~~aiding ~~mortgage~~and ~~pass-through certificates~~abetting atfraud ~~issue~~and innegligent ~~this~~misrepresentation ~~action~~relating ~~was~~to approximately $45 852 million, ~~and~~of ~~the~~securities ~~certificates~~issued by ~~had~~the ~~not~~Cheyne ~~yet incurred actual losses~~SIV. ~~Based~~On onApril 24, ~~currently available information~~2013, ~~MS&Co.~~the ~~believes~~parties itreached ~~could~~an ~~incur~~agreement ~~a loss in this action up~~ to ~~the~~settle ~~difference between~~ the ~~$45 million~~case, ~~unpaid balance of these certificates (plus any losses incurred)~~ and ~~their~~on ~~fair market value at the time of a judgment against MS&Co.~~April 26, ~~plus pre- and post-judgment interest~~2013, ~~fees and~~the ~~costs.~~court ~~MS&Co.~~dismissed ~~may be entitled to be indemnified for some of these losses and to an offset for interest received by~~ the ~~plaintiff~~action ~~prior~~with ~~to a judgment~~prejudice.

On ~~April~~December 2023, ~~2011~~2009, the Federal Home Loan Bank of ~~Boston~~Seattle filed a complaint against MS&Co. and ~~other~~another defendant ~~defendants~~ in the Superior Court of the ~~Commonwealth~~State of ~~Massachusetts~~Washington, styled Federal Home Loan Bank of ~~Boston~~Seattle v. ~~Ally~~Morgan ~~Financial,~~Stanley & Co. Inc., ~~F/K/A GMAC LLC~~ et al. The An amended complaint, ~~was~~ filed on ~~June~~September 2928, ~~2012~~2010, ~~and~~ alleges that defendants made untrue statements and material omissions in the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly ~~issued by MS&Co. or~~ sold to plaintiff by by MS&Co. was approximately $~~385~~ 233 million. The ~~amended~~ complaint raises claims under the ~~Massachusetts~~Washington ~~Uniform~~State Securities Act, ~~the Massachusetts Consumer Protection Act~~ and ~~common law and~~ seeks, among other things, to rescind the plaintiff’s purchase of such certificates. On ~~May~~January 2623, 2011, defendants removed the case to the United States District Court for the District of Massachusetts. The defendants’ motions to dismiss the amended complaint were granted in part and denied in part on September 30, 2013. On November 25, 2013, July 16, 2014, and May 19, 2015, respectively, the plaintiff voluntarily dismissed its claims against MS&Co. with respect to three of the securitizations at issue. After these voluntary dismissals, the remaining amount of certificates allegedly issued by MS&Co. or sold to plaintiff by MS&Co. was approximately $332 million. At June 25, 2017, ~~the current unpaid balance of the mortgage~~ ~~pass-through certificates at issue in this action was approximately $48 million, and~~ the ~~certificates~~parties ~~had~~reached ~~not~~an ~~yet~~agreement ~~incurred actual losses. Based on currently available information, MS&Co. believes it could incur a loss in this action up~~ to ~~the~~ ~~difference~~settle ~~between~~ the ~~$48 million unpaid balance of these certificates (plus any losses incurred) and their fair market value at the time of a judgment against MS&Co~~litigation., or upon sale, plus pre- and post-judgment interest, fees and costs. MS&Co. may be entitled to be indemnified for some of these losses and to an offset for interest received by the plaintiff prior to a judgment.

29On March 15, 2010, the Federal Home Loan Bank of San Francisco filed a complaint against MS&Co. and other defendants in the Superior Court of the State of California styled Federal Home Loan Bank of San Francisco v. Credit Suisse Securities (USA) LLC, et al. An amended complaint filed on June 10, 2010 alleged that defendants made untrue statements and material omissions in connection with the sale to plaintiff of a number of mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The amount of certificates allegedly sold to plaintiff by MS&Co. was approximately $704 million. The complaint raised claims under both the federal securities laws and California law and sought, among other things, to rescind the plaintiff’s purchase of such certificates. On January 26, 2015, as a result of a settlement with certain other defendants, the plaintiff requested and the court subsequently entered a dismissal with prejudice of certain of the plaintiff’s claims, including all remaining claims against MS&Co.

On ~~May~~March 315, ~~2013~~ 2010, ~~plaintiffs~~the inFederal ~~Deutsche~~Home ~~Zentral-Genossenschaftsbank~~Loan AGBank ~~et al.~~of v.San ~~Morgan~~Francisco ~~Stanley et al.~~ filed a complaint against MS&Co., ~~certain affiliates,~~ and other defendants in the ~~Supreme~~Superior Court of NYthe State of California styled Federal Home Loan Bank of San Francisco v. ~~The~~Deutsche Bank Securities Inc. et al. An amended complaint, filed on June 10, 2010, alleges that defendants made ~~material~~untrue ~~misrepresentations~~statements and material omissions in connection with the sale to ~~plaintiffs~~ ofplaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The ~~total~~ amount of certificates allegedly ~~sponsored,~~sold ~~underwritten~~to ~~and/or~~plaintiff ~~sold~~ by MS&Co. ~~to plaintiff~~ was approximately $~~644~~ 276 million. The complaint ~~alleges~~raises ~~causes~~claims ofunder ~~action~~both ~~against~~the ~~MS&Co.~~federal ~~for~~securities ~~common~~laws ~~law fraud, fraudulent concealment, aiding~~ and ~~abetting~~California ~~fraud, negligent misrepresentation,~~ law and ~~rescission and~~ seeks, among other things, ~~compensatory and punitive damages. On June~~ ~~10, 2014, the court granted in part and denied in part MS&Co.’s motion~~ to ~~dismiss the complaint. On June~~rescind ~~20, 2017~~ the ~~Appellate Division, First Department, affirmed the lower court~~plaintiff’s ~~June 10,~~ ~~2014~~purchase ~~order. At March 25, 2017, the current unpaid balance~~ of ~~the~~such ~~mortgage pass-through~~ certificates. On ~~at issue in this action was approximately $237~~December ~~million~~21, ~~and~~2016, the ~~certificates~~parties ~~had~~reached ~~incurred~~an ~~actual~~agreement ~~losses of approximately $87 million. Based on currently available information, MS&Co. believes it could incur a loss in this action up~~ to ~~the~~settle ~~difference between~~ the ~~$237 million unpaid balance of these certificates (plus any losses incurred) and their fair market value at the time of a judgment against MS&Co~~litigation., ~~or upon sale, plus pre- and post-judgment interest, fees and costs. MS&Co. may be entitled to be indemnified for some of these losses.~~

On30 May 17, 2013, plaintiff in IKB International S.A. in Liquidation, et al. v. Morgan Stanley, et al. filed a complaint against MS&Co. and certain affiliates in the Supreme Court of NY. The complaint alleges that defendants made material misrepresentations and omissions in the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly sponsored, underwritten and/or sold by MS&Co. to plaintiff was approximately $132 million. The complaint alleges causes of action against MS&Co. for common law fraud, fraudulent concealment, aiding and abetting fraud, and negligent misrepresentation, and seeks, among other things, compensatory and punitive damages. On October 29, 2014, the court granted in part and denied in part MS&Co.’s motion to dismiss. All claims regarding four certificates were dismissed. After these dismissals, the remaining amount of certificates allegedly issued by MS&Co. or sold to plaintiff by MS&Co. was approximately $116 million. On August 26, 2015, MS&Co. perfected its appeal from the court’s October 29, 2014 decision. On August 11, 2016, the Appellate Division, First Department affirmed the trial court’s decision denying in part MS&Co.’s motion to dismiss the complaint. At June 25, 2017, the current unpaid balance of the mortgage pass-through certificates at issue in this action was approximately $25 million, and the certificates had incurred actual losses of $58 million. Based on currently available information, MS&Co. believes it could incur a loss in this action up to the difference between the $25 million unpaid balance of these certificates (plus any losses incurred) and their fair market value at the time of a judgment against MS&Co., or upon sale, plus pre- and post-judgment interest, fees and costs. MS&Co. may be entitled to be indemnified for some of these losses and to an offset for interest received by the plaintiff prior to a judgment.

On ~~April~~July 19, ~~2016~~2010 and February 11, ~~the~~ ~~California~~2011, ~~Attorney~~Cambridge ~~General’s~~Place ~~Office~~Investment Management Inc. filed antwo ~~action~~separate complaints against MS&Co. inand/or ~~California~~its ~~state~~affiliates ~~court~~and ~~styled~~other ~~California~~defendants v.in the ~~Morgan~~Superior ~~Stanley,~~Court etof ~~al.,~~the onCommonwealth ~~behalf~~ of ~~California investors~~Massachusetts, ~~including~~both ~~the~~styled ~~California~~Cambridge ~~Public~~Place ~~Employees’ Retirement~~Investment ~~System~~Management ~~and~~Inc. ~~the~~v. ~~California~~Morgan Stanley & ~~Teachers’~~Co., ~~Retirement System~~Inc., et al. The ~~complaint~~complaints ~~alleges~~asserted ~~that~~claims ~~MS&Co.~~on ~~made~~behalf ~~misrepresentations~~of certain clients of plaintiff’s affiliates and ~~omissions~~allege ~~regarding~~that ~~residential~~defendants ~~mortgage-backed~~made ~~securities~~untrue statements and ~~notes~~material ~~issued~~omissions byin the ~~Cheyne~~sale ~~SIV,~~of a ~~and asserts~~number ~~violations~~ of mortgage ~~the~~pass-through ~~California~~certificates ~~False~~backed ~~Claims~~by ~~Act~~securitization ~~and~~trusts ~~other~~containing ~~state~~residential ~~laws~~mortgage ~~and~~loans. The total ~~seeks~~amount ~~treble~~of ~~damages,~~certificates ~~civil~~allegedly ~~penalties,~~issued ~~disgorgement,~~by MS&Co. and/or ~~injunctive~~its ~~relief.~~affiliates Onor ~~September 30,~~sold ~~2016,~~to ~~the~~plaintiff’s affiliates’ ~~court~~clients ~~granted~~by MS&Co.’s ~~demurrer,~~and/or ~~with~~its ~~leave~~affiliates toin ~~replead~~the two matters was approximately $263 million. On ~~October~~ February 2111, ~~2016~~2014, the ~~California~~parties ~~Attorney~~entered ~~General~~into ~~filed~~ an ~~amended~~agreement ~~complaint~~to settle the litigation. On ~~January~~February 2520, ~~2017~~2014, the court dismissed ~~denied MS&Co.’s demurrer with respect to~~ the ~~amended complaint~~action.

~~Settled~~On ~~Civil~~October 25, ~~Litigation~~2010, MS&Co., certain affiliates and Pinnacle Performance Limited, a special purpose vehicle (“SPV”), were named as defendants in a purported class action in the United States District Court for the Southern District of New York (“SDNY”), styled Ge Dandong, et al. v. Pinnacle Performance Ltd., et al. On January 31, 2014, the plaintiffs in the action, which related to securities issued by the SPV in Singapore, filed a second amended complaint, which asserted common law claims of fraud, aiding and abetting fraud, fraudulent inducement, aiding and abetting fraudulent inducement, and breach of the implied covenant of good faith and fair dealing. On July 17, 2014, the parties reached an agreement to settle the litigation, which received final court approval on July 2, 2015.

On ~~August~~July 255, ~~2008~~2011, ~~MS&Co.~~Allstate ~~and~~Insurance ~~two~~Company ~~ratings~~and ~~agencies~~certain ~~were~~of ~~named~~its asaffiliated ~~defendants~~entities infiled a ~~purported class action related to~~ ~~securities~~complaint ~~issued~~against byMS&Co. ain ~~structured~~the ~~investment~~Supreme ~~vehicle~~Court ~~called~~of ~~Cheyne Finance PLC and Cheyne Finance LLC (together~~NY, ~~the “Cheyne SIV”). The case was~~ styled ~~Abu~~Allstate ~~Dhabi~~Insurance ~~Commercial Bank~~Company, et al. v. Morgan Stanley ~~& Co. Inc.~~, et al. ~~The~~An amended complaint ~~alleged,~~was ~~among~~filed ~~other~~on ~~things~~September 9, 2011, and alleges that the ~~ratings~~defendants ~~assigned~~made untrue statements and material omissions in the sale to the ~~securities~~plaintiffs ~~issued~~of bycertain ~~the~~mortgage ~~Cheyne~~pass-through ~~SIV~~certificates ~~were~~backed ~~false~~by ~~and~~securitization ~~misleading,~~trusts ~~including~~containing ~~because~~residential ~~the~~mortgage ~~ratings~~loans. ~~did~~The ~~not~~total ~~accurately~~amount ~~reflect~~of ~~the~~certificates ~~risks~~allegedly ~~associated~~issued ~~with~~and/or ~~the subprime~~sold ~~RMBS~~to ~~held~~the plaintiffs by MS&Co. ~~the~~was ~~Cheyne~~approximately ~~SIV~~$104 million. The ~~plaintiffs~~complaint ~~asserted~~raised ~~allegations~~common law claims of fraud, fraudulent inducement, aiding and abetting fraud, and negligent misrepresentation ~~relating~~and toseeks, ~~approximately~~among ~~$852 million~~other ofthings, ~~securities~~compensatory ~~issued~~and/or byrecessionary damages associated with the ~~Cheyne~~plaintiffs’ ~~SIV~~purchases of such certificates. On ~~April~~January 2416, ~~2013~~2015, the parties reached an agreement to settle the ~~case, and on April 26, 2013, the court dismissed the action with prejudice~~litigation.

30On July 18, 2011, the Western and Southern Life Insurance Company and certain affiliated companies filed a complaint against MS&Co. and other defendants in the Court of Common Pleas in Ohio, styled Western and Southern Life Insurance Company, et al. v. Morgan Stanley Mortgage Capital Inc., et al. An amended complaint was filed on April 2, 2012 and alleges that defendants made untrue statements and material omissions in the sale to plaintiffs of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The amount of the certificates allegedly sold to plaintiffs by MS&Co. was approximately $153 million. On June 8, 2015, the parties reached an agreement to settle the litigation.

On ~~December~~September 232, ~~2009~~2011, the Federal ~~Home~~Housing ~~Loan~~Finance ~~Bank~~Agency of(“FHFA”), ~~Seattle~~as ~~filed~~conservator afor Fannie Mae and Freddie Mac, filed 17 complaints against numerous financial services companies, including MS&Co. and certain affiliates. A complaint against MS&Co. and ~~another~~certain ~~defendant~~affiliates ~~in the~~and ~~Superior~~other ~~Court~~defendants ofwas filed in the ~~State~~Supreme Court of ~~Washington~~NY, styled Federal ~~Home~~Housing ~~Loan~~Finance ~~Bank~~Agency, ofas ~~Seattle~~Conservator v. Morgan Stanley & ~~Co. Inc.,~~ et al. The ~~amended~~ complaint~~, filed~~ ~~on September 28, 2010,~~ alleges that defendants made untrue statements and material omissions in connection with the sale to ~~plaintiff~~Fannie ofMae ~~certain~~and ~~mortgage~~Freddie ~~pass-through~~Mac ~~certificates backed by securitization trusts containing~~ of residential mortgage ~~loans. The~~ ~~total~~pass-through ~~amount of~~ certificates ~~allegedly~~with ~~sold~~an tooriginal ~~plaintiff~~unpaid bybalance ~~MS&Co.~~of ~~was~~ approximately $~~233 million~~11 billion. The complaint ~~raises~~raised claims under ~~the~~federal ~~Washington~~and ~~State~~state ~~Securities~~securities ~~Act~~laws and common law and seeks, among other things, to ~~rescind the plaintiff’s~~rescission ~~purchase~~and ofcompensatory ~~such~~and ~~certificates~~punitive damages. On ~~January~~February 237, ~~2017~~2014, the parties ~~reached~~entered into an agreement to settle the litigation. On February 20, 2014, the court dismissed the action.

On ~~March~~April 1525, ~~2010~~2012, ~~the~~Metropolitan ~~Federal~~Life ~~Home~~Insurance ~~Loan~~Company ~~Bank~~and ofcertain ~~San~~affiliates ~~Francisco~~ filed a complaint against MS&Co. and certain ~~other~~affiliates ~~defendants~~ in the ~~Superior~~Supreme Court of ~~the~~NY, ~~State of California~~ styled ~~Federal~~Metropolitan ~~Home~~Life ~~Loan~~Insurance ~~Bank~~Company, ofet ~~San~~al. ~~Francisco~~ v. ~~Credit~~Morgan ~~Suisse Securities (USA) LLC~~Stanley, et al. An amended complaint was filed on June 1029, ~~2010~~2012, ~~alleged~~and alleges that the defendants made untrue statements and material omissions in ~~connection with~~ the sale to ~~plaintiff~~the plaintiffs of a ~~number~~certain of mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly ~~sold~~sponsored, tounderwritten, ~~plaintiff~~and/or bysold by MS&Co. was approximately $~~704~~ 758 million. The amended complaint raised common law claims ~~under~~of ~~both~~fraud, ~~the~~fraudulent ~~federal~~inducement, ~~securities~~and ~~laws~~aiding and ~~California~~abetting ~~law~~fraud and ~~sought~~seeks, among other things, to ~~rescind the~~rescission, ~~plaintiff’s~~compensatory, ~~purchase of~~and/or ~~such~~rescissionary ~~certificates. On January 26~~damages, ~~2015,~~as well as apunitive ~~result~~damages, ofassociated ~~a settlement~~ with ~~certain other defendants,~~ the ~~plaintiff~~plaintiffs’ ~~requested~~purchases ~~and~~of ~~the~~such ~~court~~certificates. ~~subsequently~~On ~~entered~~April 11, a2014, ~~dismissal with prejudice of certain of~~ the ~~plaintiff’s~~parties ~~claims,~~entered ~~including~~into ~~all remaining~~a ~~claims~~settlement ~~against MS&Co~~agreement.

On31 March 15, 2010, the Federal Home Loan Bank of San Francisco filed a complaint against MS&Co. and other defendants in the Superior Court of the State of California styled Federal Home Loan Bank of San Francisco v. Deutsche Bank Securities Inc. et al. An amended complaint, filed on June 10, 2010, alleges that defendants made untrue statements and material omissions in connection with the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The amount of certificates allegedly sold to plaintiff by MS&Co. was approximately $276 million. The complaint raises claims under both the federal securities laws and California law and seeks, among other things, to rescind the plaintiff’s purchase of such certificates. On December 21, 2016, the parties reached an agreement to settle the litigation.

On ~~July~~April 925, ~~2010~~2012, ~~and~~The ~~February 11,~~Prudential ~~2011,~~Insurance ~~Cambridge~~Company ~~Place~~of ~~Investment~~America ~~Management~~and ~~Inc.~~certain affiliates filed ~~two~~a ~~separate complaints~~ complaint against MS&Co. and~~/or~~ ~~its~~certain affiliates ~~and other defendants~~ in the Superior Court of the ~~Commonwealth~~State of ~~Massachusetts~~New Jersey, ~~both~~ styled ~~Cambridge~~The ~~Place~~Prudential ~~Investment~~Insurance ~~Management~~Company ~~Inc~~of America, et al. v. Morgan Stanley ~~& Co.~~, ~~Inc.,~~ et al. ~~The~~ ~~complaints~~On ~~asserted~~October 16, ~~claims~~2012, onplaintiffs filed ~~behalf~~an ofamended ~~certain~~complaint. ~~clients~~The ofamended ~~plaintiff’s~~complaint ~~affiliates~~alleged ~~and allege~~ that defendants made untrue statements and material omissions in connection with the sale ~~of a~~to ~~number~~plaintiffs of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly ~~issued~~sponsored, underwritten and/or sold by MS&Co. ~~and/or~~was ~~its~~approximately ~~affiliates~~$1.073 orbillion. ~~sold~~The toamended ~~plaintiff’s~~complaint ~~affiliates’~~raises ~~clients~~claims byunder ~~MS&Co.~~the New Jersey Uniform Securities Law, as ~~and/or~~well ~~its~~as ~~affiliates~~common inlaw ~~the~~claims ~~two~~of ~~matters~~negligent ~~was approximately~~misrepresentation, ~~$263 million.~~fraud, Onfraudulent ~~February 11~~inducement, ~~2014~~equitable fraud, aiding and abetting fraud, and violations of the ~~parties~~New ~~entered~~Jersey ~~into~~RICO anstatute, ~~agreement~~and toincludes ~~settle~~a ~~the~~claim ~~litigation~~for treble damages. On ~~February~~January 208, ~~2014~~2016, the parties ~~court~~reached ~~dismissed~~an agreement to settle the ~~action~~litigation.

OnIn ~~October 25,~~re ~~2010,~~Morgan ~~MS&Co.,~~Stanley ~~certain~~Mortgage ~~affiliates~~Pass-Through ~~and Pinnacle Performance Limited, a special purpose vehicle~~Certificates ~~(“SPV”)~~Litigation, ~~were~~which ~~named~~had asbeen ~~defendants~~pending in ~~a purported class action in~~ the ~~United States District Court for the Southern District of New York (“~~SDNY”), ~~styled~~was Gea ~~Dandong,~~putative etclass ~~al.~~action v.involving ~~Pinnacle~~allegations ~~Performance Ltd.~~that, etamong ~~al.~~other ~~On January 31~~things, ~~2014,~~ the ~~plaintiffs~~registration instatements ~~the~~and ~~action,~~offering ~~which~~documents related to ~~securities issued by~~ the ~~SPV~~offerings ~~in Singapore, filed a second amended complaint, which asserted common law claims~~ of ~~fraud,~~certain ~~aiding~~mortgage ~~and~~pass-through ~~abetting~~certificates in ~~fraud,~~2006 ~~fraudulent inducement, aiding~~ and ~~abetting~~2007 ~~fraudulent~~contained ~~inducement,~~false and ~~breach~~misleading ofinformation concerning the ~~implied~~pools ~~covenant~~ of ~~good~~residential ~~faith~~loans ~~and~~that ~~fair~~backed ~~dealing~~these securitizations. On ~~July~~December 1718, 2014, the parties’ ~~reached an~~ agreement to settle the litigation, ~~which~~ received final court approval, and on ~~July~~December 219, ~~2015.~~2014, the court entered an order dismissing the action.

On ~~July~~November 54, 2011, ~~Allstate~~the Federal Deposit Insurance ~~Company~~Corporation ~~and~~(“FDIC”), ~~certain~~as ofreceiver ~~its~~for ~~affiliated~~Franklin ~~entities~~Bank S.S.B, filed atwo ~~complaint~~complaints against MS&Co. in the ~~Supreme~~District Court of ~~NY,~~the State of Texas. Each was styled ~~Allstate~~Federal Deposit Insurance ~~Company,~~Corporation etas alReceiver for Franklin Bank, S.S.B v. Morgan Stanley, & etCompany ~~al.~~LLC AnF/K/A ~~amended~~Morgan ~~complaint was filed on September~~Stanley 9,& ~~2011,~~Co. Inc. and ~~alleges~~alleged that ~~the~~MS&Co. ~~defendants~~ made untrue statements and material omissions in connection with the sale to ~~the~~plaintiff ~~plaintiffs~~ of ~~certain~~ mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The ~~total~~ amount of certificates allegedly ~~issued~~underwritten and~~/or~~ sold to ~~the~~plaintiff ~~plaintiffs~~ by MS&Co. ~~was approximately~~in ~~$104 million.~~these ~~The~~cases ~~complaint~~was ~~raised~~approximately ~~common~~$67 ~~law~~million ~~claims of fraud, fraudulent inducement, aiding~~ and ~~abetting~~$35 ~~fraud~~million, ~~and negligent misrepresentation and seeks, among other things, compensatory and/or recessionary damages associated with the plaintiffs’ purchases of such certificates~~respectively. On ~~January~~ July 162, 2015, the parties reached an agreement to settle the litigation.

31On February 14, 2013, Bank Hapoalim B.M. filed a complaint against MS&Co. and certain affiliates in the Supreme Court of NY, styled Bank Hapoalim B.M. v. Morgan Stanley et al. The complaint alleges that defendants made material misrepresentations and omissions in the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly sponsored, underwritten and/or sold by MS&Co. to plaintiff was approximately $141 million. On July 28, 2015, the parties reached an agreement to settle the litigation, and on August 12, 2015, the plaintiff filed a stipulation of discontinuance with prejudice.

On ~~July~~September 1823, ~~2011~~2013, the ~~Western~~plaintiff ~~and~~in ~~Southern~~National ~~Life~~Credit ~~Insurance~~Union ~~Company~~Administration ~~and~~Board v. Morgan Stanley & Co. ~~certain~~Inc., ~~affiliated~~et ~~companies~~al. filed a complaint against MS&Co. and ~~other~~certain ~~defendants~~affiliates in the ~~Court of Common Pleas in Ohio, styled Western and Southern Life Insurance Company, et al~~SDNY. v.The ~~Morgan Stanley Mortgage Capital Inc., et al. An amended~~ complaint ~~was~~alleged ~~filed~~that ondefendants ~~April 2,~~made ~~2012~~untrue ~~and~~statements ~~alleges~~of ~~that~~material ~~defendants~~fact ~~made~~or ~~untrue~~omitted ~~statements~~to ~~and~~state material ~~omissions~~facts in the sale to ~~plaintiffs~~the plaintiff of certain mortgage pass-through certificates ~~backed~~issued by securitization trusts containing residential mortgage loans. The total amount of ~~the~~ certificates allegedly ~~sold~~sponsored, tounderwritten ~~plaintiffs~~and/or sold by MS&Co. to plaintiffs in the matter was approximately $~~153~~ 417 million. The complaint alleged violations of federal and various state securities laws and sought, among other things, rescissionary and compensatory damages. On ~~June~~November 823, 2015, the parties reached an agreement to settle the ~~litigation~~matter.

On September 216, ~~2011~~2014, the ~~Federal~~Virginia ~~Housing~~Attorney ~~Finance~~General’s ~~Agency~~Office ~~(“FHFA”),~~filed asa ~~conservator~~civil ~~for Fannie Mae and Freddie Mac~~lawsuit, ~~filed~~styled 17Commonwealth ~~complaints~~of Virginia ~~against~~ex ~~numerous~~rel. ~~financial~~Integra ~~services~~REC ~~companies,~~LLC ~~including MS&Co~~v. ~~and~~Barclays ~~certain~~Capital ~~affiliates~~Inc., Aet ~~complaint~~al., against MS&Co. and ~~certain~~several ~~affiliates and~~ other defendants ~~was filed~~ in the ~~Supreme~~Circuit Court of ~~NY,~~the ~~styled Federal~~City ~~Housing~~of ~~Finance~~Richmond ~~Agency,~~related asto ~~Conservator v~~RMBS. ~~Morgan~~The ~~Stanley~~lawsuit etalleged althat MS&Co. ~~The~~and ~~complaint~~the ~~alleges~~other ~~that~~ defendants knowingly made ~~untrue~~misrepresentations ~~statements~~ and ~~material~~ omissions inrelated ~~connection~~to ~~with~~ the ~~sale~~loans tobacking ~~Fannie~~RMBS ~~Mae~~purchased ~~and~~by ~~Freddie~~the ~~Mac~~Virginia ~~of residential~~Retirement ~~mortgage pass-through~~System. ~~certificates~~The ~~with~~complaint anasserts ~~original~~claims ~~unpaid~~under ~~balance~~the ofVirginia ~~approximately~~Fraud ~~$11 billion.~~Against ~~The~~Taxpayers ~~complaint~~Act, ~~raised~~as ~~claims~~well ~~under~~as ~~federal~~common ~~and~~law ~~state~~claims ~~securities~~of ~~laws~~actual and constructive ~~common~~fraud, ~~law~~ and seeks, among other things, ~~rescission~~treble ~~and~~damages ~~compensatory~~ and ~~punitive damages~~civil penalties. On ~~February~~January 76, ~~2014~~2016, the parties ~~entered~~reached ~~into~~ an agreement to settle the litigation. OnAn ~~February 20,~~order ~~2014,~~dismissing the ~~court~~action ~~dismissed~~with ~~the~~prejudice ~~action~~was entered on January 28, 2016.

OnAdditional ~~April 25,~~lawsuits ~~2012,~~containing ~~Metropolitan~~claims ~~Life~~similar ~~Insurance~~to ~~Company~~those ~~and~~described ~~certain~~above ~~affiliates~~may be filed ain ~~complaint~~the ~~against MS&Co~~future. ~~and certain~~In ~~affiliates in~~ the ~~Supreme~~course ~~Court~~ of its NYbusiness, ~~styled Metropolitan Life Insurance Company~~MS&Co., etas ~~al.~~a v.major ~~Morgan~~futures ~~Stanley~~commission merchant, etis ~~al.~~party Anto ~~amended~~various ~~complaint~~civil ~~was filed on June 29~~actions, ~~2012,~~claims and ~~alleges~~routine ~~that~~regulatory ~~the~~investigations ~~defendants made untrue statements~~ and ~~material~~ ~~omissions~~proceedings inthat the ~~sale~~General toPartner ~~the~~believes ~~plaintiffs~~do ofnot ~~certain~~have ~~mortgage~~a ~~pass-through~~material ~~certificates~~effect ~~backed~~on bythe ~~securitization~~business ~~trusts containing residential mortgage loans. The total amount~~ of ~~certificates allegedly sponsored, underwritten, and/or sold by~~ MS&Co. ~~was approximately $758 million~~MS&Co. ~~The~~may ~~amended~~establish ~~complaint~~reserves ~~raised~~from ~~common~~time ~~law~~to ~~claims~~time ofin ~~fraud,~~connection ~~fraudulent inducement, and aiding and abetting fraud and seeks, among other things, rescission, compensatory, and/or rescissionary damages, as well as punitive damages, associated~~ with ~~the plaintiffs’ purchases of~~ such ~~certificates~~actions. ~~On April 11, 2014, the parties entered into a settlement agreement.~~

On32 April 25, 2012, The Prudential Insurance Company of America and certain affiliates filed a complaint against MS&Co. and certain affiliates in the Superior Court of the State of New Jersey, styled The Prudential Insurance Company of America, et al. v. Morgan Stanley, et al. On October 16, 2012, plaintiffs filed an amended complaint. The amended complaint alleged that defendants made untrue statements and material omissions in connection with the sale to plaintiffs of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly sponsored, underwritten and/or sold by MS&Co. was approximately $1.073 billion. The amended complaint raises claims under the New Jersey Uniform Securities Law, as well as common law claims of negligent misrepresentation, fraud, fraudulent inducement, equitable fraud, aiding and abetting fraud, and violations of the New Jersey RICO statute, and includes a claim for treble damages. On January 8, 2016, the parties reached an agreement to settle the litigation.

InItem re Morgan Stanley Mortgage Pass-Through Certificates Litigation, which had been pending in the SDNY, was a putative class action involving allegations that, among other things, the registration statements and offering documents related to the offerings of certain mortgage pass-through certificates in 2006 and 2007 contained false and misleading information concerning the pools of residential loans that backed these securitizations1A. OnRisk ~~December 18, 2014, the parties’ agreement to settle the litigation received final court approval, and on December 19, 2014, the court entered an order dismissing the action~~Factors.

OnThere ~~November 4,~~have ~~2011,~~been ~~the~~no ~~Federal~~material ~~Deposit~~changes ~~Insurance Corporation~~to ~~(“FDIC”),~~the asrisk ~~receiver~~factors ~~for~~set ~~Franklin~~forth ~~Bank~~under ~~S.S.B~~Part I, ~~filed~~Item ~~two~~1A. ~~complaints~~“Risk ~~against MS&Co~~Factors.” in the Partnership’s ~~District~~Annual ~~Court~~Report ofon ~~the~~Form ~~State~~10-K ~~of Texas. Each was styled Federal Deposit Insurance Corporation as Receiver~~ for ~~Franklin~~the ~~Bank,~~fiscal ~~S.S.B v.~~year ~~Morgan~~ended ~~Stanley~~December &31, ~~Company~~2016 ~~LLC~~and ~~F/K/A~~under ~~Morgan~~Part ~~Stanley &~~II, ~~Co.~~Item ~~Inc~~1A. ~~and~~“Risk ~~alleged that MS&Co~~Factors.” ~~made untrue statements and material omissions~~ in ~~connection~~the ~~with~~Partnership’s ~~the~~Quarterly ~~sale~~Reports toon ~~plaintiff~~Form of10-Q ~~mortgage~~for ~~pass-through~~the ~~certificates~~quarters ~~backed~~ended ~~by securitization trusts containing residential mortgage loans. The amount of certificates allegedly underwritten and sold to plaintiff by MS&Co. in these cases was approximately $67~~March ~~million and $35 million~~31, ~~respectively.~~2017 Onand ~~July~~June 230, ~~2015, the parties reached an agreement to settle the litigation~~2017.

32Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

~~On February 14, 2013, Bank Hapoalim B.M. filed a complaint against MS&Co. and certain affiliates in the Supreme Court of NY, styled Bank Hapoalim B.M. v. Morgan Stanley et al.~~ The ~~complaint~~Partnership ~~alleges~~no ~~that~~longer ~~defendants~~offers ~~made material misrepresentations and omissions in the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans~~Units. ~~The~~ total amount of certificates allegedly sponsored, underwritten and/or sold by MS&Co. to plaintiff was approximately $141 million. On July 28, 2015, the parties reached an agreement to settle the litigation, and on August 12, 2015, the plaintiff filed a stipulation of discontinuance with prejudice.

~~On September 23, 2013, the plaintiff in National Credit Union Administration Board v. Morgan Stanley & Co. Inc., et al. filed a complaint against MS&Co. and certain affiliates in the SDNY.~~ The ~~complaint~~following ~~alleged~~chart ~~that~~sets ~~defendants~~forth ~~made untrue statements of material fact or omitted to state material facts in~~ the ~~sale~~ topurchases ~~the plaintiff~~ of ~~certain~~limited ~~mortgage~~partner ~~pass-through~~Units ~~certificates issued~~ by ~~securitization trusts containing residential mortgage loans. The total amount of certificates allegedly sponsored, underwritten and/or sold by MS&Co. to plaintiffs in~~ the ~~matter was approximately $417 million~~Partnership. The complaint alleged violations of federal and various state securities laws and sought, among other things, rescissionary and compensatory damages. On November 23, 2015, the parties reached an agreement to settle the matter.

On September 16, 2014, the Virginia Attorney General’s Office filed a civil lawsuit, styled Commonwealth of Virginia ex rel. Integra REC LLC v. Barclays Capital Inc., et al., against MS&Co. and several other defendants in the Circuit Court of the City of Richmond related to RMBS. The lawsuit alleged that MS&Co. and the other defendants knowingly made misrepresentations and omissions related to the loans backing RMBS purchased by the Virginia Retirement System. The complaint asserts claims under the Virginia Fraud Against Taxpayers Act, as well as common law claims of actual and constructive fraud, and seeks, among other things, treble damages and civil penalties. On January 6, 2016, the parties reached an agreement to settle the litigation. An order dismissing the action with prejudice was entered on January 28, 2016.


Period	(a) Total Number of Units Purchased *		(b) Average Price Paid per Unit **		(c) Total Number of Units Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Number (or Approximate Dollar Value) of Units that May Yet Be Purchased Under the Plans or Programs
July 1, 2017 - July 31, 2017		44,014.745	$	17.00		N/A		N/A
August 1, 2017 - August 31, 2017		56,868.349	$	17.41		N/A		N/A
September 1, 2017 - September 30, 2017		47,114.898	$	16.54		N/A		N/A
		147,997.992	$	17.01

~~Additional~~* ~~lawsuits~~Generally, ~~containing~~limited ~~claims~~partners ~~similar~~are permitted to ~~those~~redeem ~~described~~their ~~above may~~Units beas ~~filed~~of in the ~~future.~~end Inof each month if notice is received by the ~~course~~General ofPartner ~~its~~no ~~business,~~later ~~MS&Co~~than 3:00 P.M., asNew aYork ~~major~~City ~~futures~~time, ~~commission~~on ~~merchant,~~the islast ~~party~~day of the month in which the redemption is to ~~various~~be ~~civil~~effective. ~~actions~~Under certain circumstances, ~~claims~~the ~~and~~General ~~routine~~Partner ~~regulatory~~can ~~investigations~~compel ~~and~~redemption, ~~proceedings~~although ~~that~~to date, the General Partner ~~believes~~has do not ~~have~~ aexercised ~~material~~this ~~effect~~right. onPurchases of Units by the ~~business~~Partnership ofreflected ~~MS&Co.~~in ~~MS&Co.~~the ~~may~~chart ~~establish~~above ~~reserves~~were ~~from~~made ~~time~~in tothe ~~time~~ordinary course of the Partnership’s business in connection with ~~such~~effecting ~~actions.~~redemptions for limited partners.

33** Redemptions of Units are effected as of the last day of each month at the net asset value per Unit as of that day. No fee will be charged for redemptions.

Item 1A3. ~~Risk~~Defaults ~~Factors~~Upon Senior Securities. — None.

~~There have been no material changes to the risk factors set forth under Part I,~~ Item 1A4. ~~“Risk~~Mine ~~Factors.”~~Safety ~~in the Partnership’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016 and under Part II, Item 1A~~Disclosures. ~~“Risk~~— ~~Factors.”~~Not ~~in the Partnership’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017~~applicable.

Item 25. ~~Unregistered~~Other ~~Sales~~Information. of— ~~Equity Securities and Use of Proceeds~~None.

~~The~~33 ~~Partnership no longer offers Units.~~

~~The~~Item ~~following chart sets forth the purchases of limited partner Units by the Partnership~~6. Exhibits.

Period	(a) Total Number of Units Purchased *	(b) Average PricePaid per Unit **		(c ) Total Number ofUnits Purchased as Part of Publicly AnnouncedPlans or Programs	(d) Maximum Number (orApproximate DollarValue) of Units that MayYet Be Purchased Underthe Plans or Programs
31.01	Certification of President and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
April 1, 2017 - April 30, 2017	72,557.208	$	17.72	N/A	N/A
31.02	Certification of Chief Financial Officer and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
May 1, 2017 - May 31, 2017	61,124.455	$	17.96	N/A	N/A
32.01	Certification of President and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
June 1, 2017 - June 30, 2017	67,199.362	$	17.18	N/A	N/A
32.02	Certification of Chief Financial Officer and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	200,881.025	$	17.61
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Document
101.PRE*	XBRL Taxonomy Extension Presentation Document
101.DEF*	XBRL Taxonomy Extension Definition Document

*Notes ~~Generally, limited partners are permitted~~ to ~~redeem~~Exhibits ~~their~~List Units as of the end of each month if notice is received by the General Partner no later than 3:00 P.M., New York City time, on the last day of the month in which the redemption is to be effective. Under certain circumstances, the General Partner can compel redemption, although to date, the General Partner has not exercised this right. Purchases of Units by the Partnership reflected in the chart above were made in the ordinary course of the Partnership’s business in connection with effecting redemptions for limited partners.

** ~~Redemptions~~Submitted ofelectronically ~~Units are effected as of the last day of each month at the net asset value per Unit as of that day~~herewith. ~~No fee will be charged for redemptions.~~

~~Item~~34 ~~3. Defaults Upon Senior Securities. — None.~~

~~Item~~SIGNATURES ~~4. Mine Safety Disclosures. — Not applicable.~~

~~Item~~Pursuant 5.to ~~Other~~the ~~Information.~~requirements —of ~~None~~the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

34MORGAN STANLEY SMITH BARNEY SPECTRUM TECHNICAL L.P.

~~Item~~By: 6Ceres Managed Futures LLC (General Partner) By: /s/ Patrick T. ~~Exhibits~~Egan Patrick T. Egan President and Director Date: November 13, 2017 By: /s/ Steven Ross Steven Ross Chief Financial Officer and Director (Principal Accounting Officer) Date: November 13, 2017

10.01		Institutional Account Agreement, dated as of July 12, 2017, by and between SECOR Master Fund L.P. and J.P. Morgan Securities LLC, JPMorgan Chase Bank, N.A., J.P. Morgan Securities plc, J.P. Morgan Securities (Asia Pacific) Limited, J.P. Morgan Securities Asia Private Limited, J.P. Morgan Securities Australia Limited, JPMorgan Securities Japan Co., Ltd., J.P. Morgan Prime Nominees Limited, J.P. Morgan Markets Limited and J.P. Morgan Prime Inc.
10.02		Foreign Exchange and Bullion Authorization Agreement, dated as of July 12, 2017, by and among SECOR Master Fund L.P., SECOR Capital Advisors and JPMorgan Chase Bank, N.A.
10.03		International Swap Dealers Association, Inc. Master Agreement, Schedule to the ISDA Master Agreement, and 2016 Credit Support Annex for Variation Margin to the Schedule to the ISDA Master Agreement, each dated as of July 12, 2017, by and between SECOR Master Fund L.P. and JPMorgan Chase Bank, N.A.
31.01		Certification of President and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.02		Certification of Chief Financial Officer and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.01		Certification of President and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.02		Certification of Chief Financial Officer and Director of Ceres Managed Futures LLC, the General Partner of the Partnership, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		XBRL Instance Document
101.SCH*		XBRL Taxonomy Extension Schema Document
101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*		XBRL Taxonomy Extension Label Document
101.PRE*		XBRL Taxonomy Extension Presentation Document
101.DEF*		XBRL Taxonomy Extension Definition Document

The General Partner which signed the above is the only party authorized to act for the registrant. The registrant has no principal executive officer, principal financial officer, controller, or principal accounting officer and has no Board of Directors.

~~Notes~~35 ~~to Exhibits List~~

* Submitted electronically herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

MORGAN STANLEY SMITH BARNEY SPECTRUM TECHNICAL L.P.

By: Ceres Managed Futures LLC (General Partner) By: /s/ Patrick T. Egan Patrick T. Egan President and Director

Date: August 10, 2017

By: /s/ Steven Ross Steven Ross Chief Financial Officer and Director (Principal Accounting Officer)

Date: August 10, 2017

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