MORGAN STANLEY SPECTRUM COMMODITY LP - 10-K Annual Report

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 [No Fee Required]
For the year ended December 31, 2001 or

[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 [No Fee Required]
For the transition period from ________________to___________________
Commission File Number 0-24035

MORGAN STANLEY SPECTRUM COMMODITY L.P.

(Exact name of registrant as specified in its Limited Partnership Agreement)

DELAWARE 13-3968008
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

Demeter Management Corporation
c/o Managed Futures Department,
825 Third Avenue, 8th Floor,
New York, NY 10022
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code (201) 876-4647

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

Name of each exchange
Title of each class on which registered

None None

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

Units of Limited Partnership Interest

(Title of Class)

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 if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K (section 229.405 of this chapter) is not contained
herein, and will not be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendment of this Form 10-K. [X]

State the aggregate market value of the Units of Limited Partnership Interest
held by non-affiliates of the registrant. The aggregate market value shall be
computed by reference to the price at which units were sold as of a specified
date within 60 days prior to the date of filing: $12,426,054 at January 31,
2002.

DOCUMENTS INCORPORATED BY REFERENCE
(See Page 1)

MORGAN STANLEY SPECTRUM COMMODITY L.P.
(formerly, "Morgan Stanley Dean Witter Spectrum Commodity L.P.")
INDEX TO ANNUAL REPORT ON FORM 10-K
DECEMBER 31, 2001

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the following documents are incorporated by reference
as follows:

Documents Incorporated Part of Form 10-K

Partnership's Prospectus dated
March 23, 2001 I

Partnership's Supplement to the
Prospectus dated December 6, 2001 I

Annual Report to Morgan Stanley
Spectrum Series Limited
Partners for the year ended
December 31, 2001 II, III and IV

PART I
Item 1. BUSINESS
(a) General Development of Business. Morgan Stanley Spectrum
Commodity L.P. (the "Partnership") is a Delaware limited
partnership organized to engage primarily in the speculative
trading of futures contracts, options on futures contracts and
forward contracts in the metals, energy and agricultural markets.
The Partnership commenced operations on January 2, 1998. The
Partnership is one of the Morgan Stanley Spectrum Series
(formerly, "Morgan Stanley Dean Witter Spectrum Series") of funds,
comprised of the Partnership, Morgan Stanley Spectrum Currency
L.P., Morgan Stanley Spectrum Global Balanced L.P., Morgan Stanley
Spectrum Strategic L.P., Morgan Stanley Spectrum Select L.P. and
Morgan Stanley Spectrum Technical L.P. (collectively, the
"Spectrum Series").

On November 1, 2001, Morgan Stanley Dean Witter Spectrum Commodity
L.P., Morgan Stanley Dean Witter Spectrum Currency L.P., Morgan
Stanley Dean Witter Spectrum Global Balanced L.P., Morgan Stanley
Dean Witter Spectrum Strategic L.P., Morgan Stanley Dean Witter
Spectrum Select L.P., and Morgan Stanley Dean Witter Spectrum
Technical L.P. were renamed Morgan Stanley Spectrum Commodity
L.P., Morgan Stanley Spectrum Currency L.P., Morgan Stanley
Spectrum Global Balanced L.P., Morgan Stanley Spectrum Strategic
L.P., Morgan Stanley Spectrum Select L.P., and Morgan Stanley
Spectrum Technical L.P., respectively.

The general partner is Demeter Management Corporation ("Demeter").
The non-clearing commodity broker is Morgan Stanley DW Inc.
("Morgan Stanley DW"). The clearing commodity brokers are Morgan
Stanley & Co., Inc. ("MS & Co.") and Morgan Stanley & Co.
International Limited ("MSIL"). The trading advisor is Morgan
Stanley Commodities Management, Inc. ("MSCM" or the "Trading
Advisor"). MSCM, Demeter, Morgan Stanley DW, MS & Co. and MSIL
are wholly-owned subsidiaries of Morgan Stanley Dean Witter & Co.
("MSDW").

Effective April 2, 2001 Dean Witter Reynolds Inc. changed its name
to Morgan Stanley DW Inc.

Effective September 28, 2001, Morgan Stanley Dean Witter
Commodities Management, Inc. changed its name to Morgan Stanley
Commodities Management, Inc.

The managing underwriter for the Spectrum Series is Morgan Stanley
DW.

Units of limited partnership interest ("Unit(s)") are offered for
sale at monthly closings at a price equal to 100% of the net asset
value per Unit at the close of business on the last day of each
month.

The Partnership's net asset value per Unit at December 31, 2001
was $5.84, representing a decrease of 25.61 percent from the net
asset value per Unit of $7.85 at December 31, 2000. For a more
detailed description of the Partnership's business see
subparagraph (c).

(b) Financial Information about Segments. For financial
information reporting purposes the Partnership is deemed to engage
in one industry segment, the speculative trading of futures,
forwards and options. The relevant financial information is
presented in Items 6 and 8.
(c) Narrative Description of Business. The Partnership is in the
business of speculative trading of futures, forwards, and options
pursuant to trading instructions provided by the Trading Advisor.
For a detailed description of the different facets of the
Partnership's business, see those portions of the Partnership's
prospectus, dated March 23, 2001 (the "Prospectus"), and the
Partnership's supplement to the Prospectus dated December 6, 2001
(the "Supplement") incorporated by reference in this Form 10-K,
set forth below.
Facets of Business
1. Summary 1. "Summary" (Pages 1-8 of
the Prospectus and Page
S-2 of the Supplement).

2. Futures, Options, 2. "The Futures, Options, and
and Forwards Markets Forwards Markets" (Pages
145-149 of the Prospec-
tus).

3. Partnership's Trading 3. "Use of Proceeds" (Pages
Arrangements and 26-28 of the Prospectus
Policies and Page S-5 of the
Supplement). "The Trading
Advisors" (Pages 71-123
of the Prospectus and Pages
S-33 - S-44 of the Supple-
ment).

4. Management of the Part- 4. "The Trading Advisors -
nership The Management Agreements"
(Page 71 of the Prospectus),
"The General Partner" (Pages
66-70 of the Prospectus
and Pages S-31 - S-32 of
the Supplement), "The
Commodity Brokers" (Pages
125-127 of the Prospectus)
and "The Limited Partner-
ship Agreements" (Pages
128-131 of the Prospectus).

5. Taxation of the Partner- 5. "Material Federal Income
ship's Limited Partners Tax Considerations" and
"State and Local Income
Tax Aspects" (Pages
136-143 of the Prospectus).

(d) Financial Information about Geographic Areas
The Partnership has not engaged in any operations in foreign
countries; however, the Partnership (through the commodity
brokers) enters into forward contract transactions where foreign
banks are the contracting party and trades in futures, forwards
and options on foreign exchanges.

Item 2. PROPERTIES
The executive and administrative offices are located within the
offices of Morgan Stanley DW. The Morgan Stanley DW offices
utilized by the Partnership are located at 825 Third Avenue, 8th
Floor, New York, NY 10022.

Demeter changed its address from 2 World Trade Center, New York,
NY 10048.

Item 3. LEGAL PROCEEDINGS
In April 2001, the Appellate Division of New York State dismissed
the class action previously disclosed in the Partnership's Form
10-K for the year ended December 31, 2000. Because plaintiffs did
not exercise their right to appeal any further, this dismissal
constituted a final resolution of the case.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.

PART II

Item 5. MARKET FOR THE REGISTRANT'S PARTNERSHIP UNITS AND
RELATED SECURITY HOLDER MATTERS

(a) Market Information
There is no established public trading market for Units of the
Partnership.

(b) Holders
The number of holders of Units at December 31, 2001 was
approximately 2,190.

(c) Distributions
No distributions have been made by the Partnership since it
commenced trading operations on January 2, 1998. Demeter has sole
discretion to decide what distributions, if any, shall be made to
investors in the Partnership. Demeter currently does not intend
to make any distribution of Partnership profits.

(d) Use of Proceeds
Units are sold at monthly closings as of the last day of each
month at a price equal to 100% of the net asset value per Unit as
of the date of such monthly closing.

Through December 31, 2001, 4,760,272.466 Units were sold, leaving
6,435,221.166 Units unsold at December 31, 2001. The aggregate

price of the Units sold through December 31, 2001 was $45,189,560.

Since no expenses are chargeable against proceeds, 100% of the
proceeds of the offering have been applied to the working capital
of the Partnership for use in accordance with the "Use of
Proceeds" section of the Prospectus and the Supplement.

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

Liquidity - The Partnership deposits its assets with Morgan
Stanley DW as non-clearing broker and MS & Co. and MSIL as
clearing brokers in separate futures, forwards and options trading
accounts established for the Trading Advisor, which assets are
used as margin to engage in trading. The assets are held in either
non-interest-bearing bank accounts or in securities and
instruments permitted by the Commodity Futures Trading Commission
for investment of customer segregated or secured funds. The
Partnership's assets held by the commodity brokers may be used as
margin solely for the Partnership's trading. Since the
Partnership's sole purpose is to trade in futures, forwards and
options, it is expected that the Partnership will continue to own
such liquid assets for margin purposes.

The Partnership's investment in futures, forwards and options 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 fluctuations limits" or "daily limits". Trades
may not be executed at prices beyond the daily limit. If the
price for a particular futures or options contract has increased
or decreased by an amount equal to the daily limit, positions in
that futures or options 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 options contracts and
result in restrictions on redemptions.

The Partnership has never had illiquidity affect a material
portion of its assets.

Capital Resources. The Partnership does not have, nor expect to
have, any capital assets. Redemptions, exchanges and sales of
additional Units in the future will affect the amount of funds
available for investment in futures, forwards and options in
subsequent periods. It is not possible to estimate the amount and
therefore the impact of future redemptions of Units.

Results of Operations.
General. The Partnership's results depend on the Trading Advisor
and the ability of the Trading Advisor's trading programs to take
advantage of price movements or other profit opportunities in the
futures, forwards and options markets. The following presents a
summary of the Partnership's operations for the three years ended
December 31, 2001, and a general discussion of its trading

activities during each period. It is important to note, however,
that the Trading Advisor trades in various markets at different
times and that prior activity in a particular market does not
mean that such market will be actively traded by the Trading
Advisor or will be profitable in the future. Consequently, the
results of operations of the Partnership are difficult to discuss
other than in the context of the Trading Advisor's trading
activities on behalf of the Partnership and how the Partnership
has performed in the past.

At December 31, 2001, the Partnership's total capital was
$12,974,679, a decrease of $7,225,302 from the Partnership's total
capital of $20,199,981 at December 31, 2000. For the year ended
December 31, 2001, the Partnership generated a net loss of
$4,888,302, total subscriptions aggregated $1,838,372 and total
redemptions aggregated $4,175,372.

For the year ended December 31, 2001, the Partnership recorded
total trading losses, net of interest income, of $3,751,629 and
posted a decrease in net asset value per Unit. The most
significant losses of approximately 9.7% were recorded in the
energy markets throughout a majority of the year from long

positions in natural gas futures as prices reversed the sharp
upward trend experienced in late 2000 amid reports of increased
inventories and forecasts for favorable weather. In the metals
markets, losses of approximately 6.5% were experienced throughout
a majority of the year from long positions in copper and aluminum
futures as the slowdown in the U.S. economy and weak demand drove
prices lower. In the agricultural markets, losses of
approximately 5.8% were incurred from long positions in corn and
wheat futures as prices moved lower due to favorable weather
forecasts and on reports of declining demand. In the soft
commodities markets, losses of approximately 2.3% were recorded
throughout a majority of the year from long cotton futures
positions as prices moved lower on weak export sales and low
demand. Total expenses for the year were $1,136,673, resulting
in a net loss of $4,888,302. The net asset value of a Unit
decreased from $7.85 at December 31, 2000 to $5.84 at December 31,
2001.

At December 31, 2000, the Partnership's total capital was
$20,199,981, a decrease of $3,440,489 from the Partnership's total
capital of $23,640,470 at December 31, 1999. For the year ended
December 31, 2000, the Partnership generated net income of
$622,362, total subscriptions aggregated $2,115,964 and total
redemptions aggregated $6,178,815.

For the year ended December 31, 2000, the Partnership recorded
total trading revenues, including interest income, of $2,176,463
and posted an increase in net asset value per Unit. The most
significant gains of approximately 16.4% were recorded in the
energy markets primarily during May from long positions in
natural gas futures as prices trended higher, as data released by
the American Gas Association further confirmed fears that
inventory levels remain low. During August, November and
December, additional gains were recorded from long positions in
natural gas futures as prices climbed to all time highs amid
supply and storage concerns. Additional gains were recorded
during January and February from long futures positions in crude
oil and its refined products as oil prices increased on concerns
about future output levels from the world's leading producer
countries amid dwindling stockpiles and increasing demand. A
portion of the Partnership's overall gains was partially offset
by losses of approximately 5.6% recorded in the metals markets
throughout a majority of the year from long silver futures
positions as silver prices declined on technically-based factors.
Additional losses were incurred from long aluminum and copper
futures positions as prices moved lower during February and
October due primarily to technically-based selling. In soft
commodities, losses of approximately 4.6% were experienced

primarily during January and February from long coffee futures
positions as coffee prices declined in the wake of forecasts for
a bumper crop in Brazil. Additional losses were recorded
throughout a majority of the second and fourth quarters from long
coffee futures positions as prices decreased. Total expenses for
the year were $1,554,101, resulting in net income of $622,362.
The net asset value of a Unit increased from $7.61 at December
31, 1999 to $7.85 at December 31, 2000.

At December 31, 1999, the Partnership's total capital was
$23,640,470, a decrease of $1,267,846 from the Partnership's total
capital of $24,908,316 at December 31, 1998. For the year ended
December 31, 1999, the Partnership generated net income of
$3,375,789 and total redemptions aggregated $4,643,635.

For the year ended December 31, 1999, the Partnership recorded
total trading revenues, including interest income, of $5,045,724
and posted an increase in net asset value per Unit. During 1999,
commodity market price behavior returned to the more normal
pattern of some commodities gaining in price, while other
commodities declined in price. Of the seventeen components of
the Bridge Commodity Research Bureau Index ("CRB"), ten increased
in price during 1999, while the remaining seven declined in

price. This was noticeably different from 1998, when all but one
of the components of the CRB declined in price. Energy markets,
which had been the worst performing sector during 1998, rebounded
strongly to become the best performing commodity sector in 1999,
which resulted in gains for the Partnership of approximately
13.35%. OPEC, which had suffered economically as their late 1997
decision to expand production coincided with the onset of
economic difficulties in virtually all of the world's emerging
economies, cooperated with other major global oil producing
countries to rein in production and allow for the drawing down of
inventories that had grown steadily throughout 1998. Crude oil,
its refined products, and natural gas all benefited from the
improving global demand for energy and the decreased supply of
crude oil. Base metals markets also improved in price during
1999 resulting in gains of approximately 8.55%. Historically,
copper has been referred to by some as "the world's economist",
rising in price as economic activity improves and falling in
price when economic difficulties are encountered. During both
1998 and 1999, copper served as an accurate barometer of global
economic health. Copper producers' decisions to curtail
production in the short-term helped support prices. Perhaps more
importantly for the long-term, the consolidation of major mining
companies in both copper and aluminum bodes well for less over-

expansion during future periods of elevated prices, likely
leading to "higher highs" and "higher lows" in future price
cycles. Precious metals prices also improved modestly during
1999. After several years of lower gold prices, with central
banks continuing to sell despite the lower prices, an announcement
by a group of European central banks abruptly reversed the price
slide and caught many short-sellers off guard. For 1999, gold was
up in price by less than 1%, while silver and platinum, which have
significant industrial demand, fared much better. Grain markets
continued to suffer in price during 1999 resulting in a loss of
approximately 5.37%. Despite an early summer scare caused by dry
weather, overall conditions were favorable for another good
harvest. As the year drew to a close, improved demand finally
surfaced, perhaps signaling an end to multi-decade low prices.
Total expenses for the year were $1,669,935, resulting in net
income of $3,375,789. The net asset value of a Unit increased
from $6.57 at December 31, 1998 to $7.61 at December 31, 1999.

The Partnership's overall performance record represents varied
results of trading in different futures, forwards and options
markets. For a further description of 2001 trading results, refer
to the letter to the Limited Partners in the accompanying Annual
Report to Limited Partners for the year ended December 31, 2001,
which is incorporated by reference to Exhibit 13.01 of this Form

10-K. The Partnership's gains and losses are allocated among its
partners for income tax purposes.

Credit Risk.
Financial Instruments. The Partnership is a party to financial
instruments with elements of off-balance sheet market and credit
risk. The Partnership may trade futures, forwards and options in
precious and base metals, agricultural and energy products, and
other commodity interests. In entering into these contracts, the
Partnership is subject to the market risk that such contracts may
be significantly influenced by market conditions, resulting in
such contracts being less valuable. If the markets should move
against all of the positions held by the Partnership at the same
time, and if the Trading Advisor were unable to offset positions
of the Partnership, the Partnership could lose all of its assets
and investors would realize a 100% loss.

In addition to the Trading Advisor's internal controls, the
Trading Advisor must comply with the trading policies of the
Partnership. These trading policies include standards for
liquidity and leverage with which the Partnership must comply.
The Trading Advisor and Demeter monitor the Partnership's trading
activities to ensure compliance with the trading policies.

Demeter may require the Trading Advisor to modify positions of
the Partnership if Demeter believes they violate the
Partnership's trading policies.

In addition to market risk, in entering into futures, forward and
options contracts there is a credit risk to the Partnership that
the counterparty on a contract will not be able to meet its
obligations to the Partnership. The ultimate counterparty or
guarantor of the Partnership for futures contracts traded in the
United States and the foreign exchanges on which the Partnership
trades is the clearinghouse associated with such exchange. In
general, a clearinghouse is backed by the membership of the
exchange and will act in the event of non-performance by one of
its members or one of its member's customers, which should
significantly reduce this credit risk. For example, a
clearinghouse may cover a default by drawing upon a defaulting
member's mandatory contributions and/or non-defaulting members'
contributions to a clearinghouse guarantee fund, established
lines or letters of credit with banks, and/or the clearinghouse's
surplus capital and other available assets of the exchange and
clearinghouse, or assessing its members. In cases where the
Partnership trades off-exchange forward contracts with a
counterparty, the sole recourse of the Partnership will be the
forward contracts counterparty.

There is no assurance that a clearinghouse, exchange or exchange
member will meet its obligations to the Partnership, and Demeter
and the commodity brokers will not indemnify the Partnership
against a default by such parties. Further, the law is unclear as
- 19 -
to whether a commodity broker has any obligation to protect its
customers from loss in the event of an exchange or clearinghouse
defaulting on trades effected for the broker's customers. Any
such obligation on the part of a broker appears even less clear
where the default occurs in a non-U.S. jurisdiction.

Demeter deals with these credit risks of the Partnership in
several ways. First, it monitors the Partnership's credit
exposure to each exchange on a daily basis, calculating not only
the amount of margin required for it but also the amount of its
unrealized gains at each exchange, if any. The commodity brokers
inform the Partnership, as with all their customers, of its net
margin requirements for all its existing open positions, but do
not break that net figure down, exchange by exchange. Demeter,
however, has installed a system which permits it to monitor the
Partnership's potential margin liability, exchange by exchange.
As a result, Demeter is able to monitor the Partnership's
potential net credit exposure to each exchange by adding the
unrealized trading gains on that exchange, if any, to the
Partnership's margin liability thereon.

Second, the Partnership's trading policies limit the amount of
its net assets that can be committed at any given time to futures
contracts and require, in addition, a minimum amount of
diversification in the Partnership's trading, usually over
several different products. One of the aims of such trading
policies has been to reduce the credit exposure of the
Partnership to a single exchange and, historically, the
Partnership's exposure to any one exchange has typically amounted
to only a small percentage of its total net assets. On those
relatively few occasions where the Partnership's credit exposure
may climb above that level, Demeter deals with the situation on a
case by case basis, carefully weighing whether the increased
level of credit exposure remains appropriate. Material changes
to the trading policies may be made only with the prior written
approval of the limited partners owning more than 50% of Units
then outstanding.

Third, with respect to forward contract trading, the Partnership
trades with only those counterparties which Demeter, together
with Morgan Stanley DW, have determined to be creditworthy. The
Partnership presently deals with MS & Co. as the sole
counterparty on forward contracts.

Inflation has not been a major factor in the Partnership's
operations.

See "Financial Instruments" under Notes to Financial Statements
in the Partnership's Annual Report to Limited Partners for the
year ended December 31, 2001, which is incorporated by reference
to Exhibit 13.01 of this Form 10-K.

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK

Introduction
The Partnership is a commodity pool engaged primarily in the
speculative trading of futures, forwards and options. The market-
sensitive instruments held by the Partnership are acquired for
speculative trading purposes only and, as a result, all or
substantially all of the Partnership's assets are at risk of
trading loss. Unlike an operating company, the risk of market-
sensitive instruments is central, not incidental, to the
Partnership's main business activities.

The futures, forwards and options traded 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. Fluctuations in market risk based
upon these factors result in frequent changes in the fair value
of the Partnership's open positions, and, consequently, in its
earnings and cash flow.

The Partnership's total market risk is influenced by a wide
variety of factors, including the diversification among the
Partnership's open positions, the volatility present within the
markets, and the liquidity of the markets. At different times,
each of these factors may act to increase or decrease the market
risk associated with the Partnership.

The Partnership's past performance is not necessarily indicative
of its future results. Any attempt to numerically quantify the
Partnership's market risk is limited by the uncertainty of its
speculative trading. The Partnership's speculative trading may
cause future losses and volatility (i.e. "risk of ruin") that far
exceed the Partnership's experiences to date or any reasonable
expectations based upon historical changes in market value.

Quantifying the Partnership's Trading Value at Risk
The following quantitative disclosures regarding the Partnership'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 and
Section 21E of the Securities Exchange Act of 1934). 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 accounts for open positions using mark-to-market
accounting principles. Any loss in the market value of the
Partnership's open positions is directly reflected in the
Partnership's earnings, whether realized or unrealized, and its
cash flow. Profits and losses on open positions of exchange-
traded futures, forwards and options are settled daily through
variation margin.

The Partnership's risk exposure in the market sectors traded by
the Trading Advisor is estimated below in terms of Value at Risk
("VaR"). The VaR model used by the Partnership includes many
variables that could change the market value of the Partnership's
trading portfolio. The Partnership estimates VaR using a model
based upon historical simulation with a confidence level of 99%.
Historical simulation involves constructing a distribution of
hypothetical daily changes in the value of a trading portfolio.

The VaR model takes into account linear exposures to price and
interest rate risk. Market risks that are incorporated in the
VaR model include equity and commodity prices, interest rates,
foreign exchange rates, and correlation among these variables.
The hypothetical changes in portfolio value are based on daily
percentage changes observed in key market indices or other market
factors ("market risk factors") to which the portfolio is
sensitive. The historical observation period of the Partnership's
VaR is approximately four years. The one-day 99% confidence
level of the Partnership's VaR corresponds to the negative change
in portfolio value that, based on observed market risk factors,
would have been exceeded once in 100 trading days.

VaR models, including the Partnership's, are continuously
evolving as trading portfolios become more diverse and modeling
techniques and systems capabilities improve. Please note that
the VaR model is used to numerically quantify market risk for
historic reporting purposes only and is not utilized by either
Demeter or the Trading Advisor in their daily risk management
activities.

The Partnership's Value at Risk in Different Market Sectors
The following table indicates the VaR associated with the
Partnership's open positions as a percentage of total net assets

by primary market risk category at December 31, 2001 and 2000. At
December 31, 2001 and 2000, the Partnership's total
capitalization was approximately $13 million and $20 million,
respectively.

Primary Market December 31, 2001 December 31, 2000
Risk Category Value at Risk Value at Risk

Commodity (1.55)% (1.64)%

The table above represents the VaR of the Partnership's open
positions at December 31, 2001 and 2000 only and is not
necessarily representative of either the historic or future risk
of an investment in the Partnership. Because the Partnership's
only business is the speculative trading of futures, forwards and
options, the composition of its trading portfolio can change
significantly over any given time period, or even within a single
trading day. Any changes in open positions could positively or
negatively materially impact market risk as measured by VaR.

The table below supplements the December 31, 2001 VaR by
presenting the Partnership's high, low and average VaR, as a
percentage of total net assets for the four quarterly reporting
periods from January 1, 2001 through December 31, 2001.

Primary Market Risk Category High Low Average
Commodity (1.58)% (1.55)% (1.57)%

Limitations on Value at Risk as an Assessment of Market Risk
The face value of the market sector instruments held by the
Partnership is typically many times the applicable margin
requirements. Margin requirements generally range between 2% and
15% of contract face value. Additionally, the use of leverage
causes the face value of the market sector instruments held by
the Partnership to typically be many times the total
capitalization of the Partnership. The value of the
Partnership's open positions thus creates a "risk of ruin" not
typically found in other investments. The relative size of the
positions held may cause the Partnership to incur losses greatly
in excess of VaR within a short period of time, given the effects
of the leverage employed and market volatility. The VaR tables
above, as well as the past performance of the Partnership, give
no indication of such "risk of ruin". In addition, VaR risk
measures should be viewed in light of the methodology's
limitations, which include the following:
? past changes in market risk factors will not always result in
accurate predictions of the distributions and correlations of
future market movements;

? changes in portfolio value caused by market movements may
differ from those of the VaR model;
? VaR results reflect past trading positions while future risk
depends on future positions;
? VaR using a one-day time horizon does not fully capture the
market risk of positions that cannot be liquidated or hedged
within one day; and
? the historical market risk factor data used for VaR estimation
may provide only limited insight into losses that could be
incurred under certain unusual market movements.

The VaR tables above present the results of the Partnership's VaR
for the Partnership's market risk exposure at December 31, 2001
and 2000, and for the end of the four quarterly reporting periods
during calendar year 2001. Since VaR is based on historical
data, VaR should not be viewed as predictive of the Partnership's
future financial performance or its ability to manage or monitor
risk. There can be no assurance that the Partnership's actual
losses on a particular day will not exceed the VaR amounts
indicated above or that such losses will not occur more than once
in 100 trading days.

Non-Trading Risk
The Partnership has non-trading market risk on its foreign cash
balances not needed for margin. These balances and any market
risk they may represent are immaterial.

At December 31, 2001, the Partnership's cash balance at Morgan
Stanley DW was approximately 95% of its total net asset value. A
decline in short-term interest rates will result in a decline in
the Partnership's cash management income. This cash flow risk is
not considered to be material.

Materiality, as used throughout this section, is based on an
assessment of reasonably possible market movements and any
associated potential losses, taking into account the leverage,
optionality and multiplier features of the Partnership's market-
sensitive instruments, in relation to the Partnership's net
assets.

Qualitative Disclosures Regarding Primary Trading Risk Exposures
The following qualitative disclosures regarding the Partnership's
market risk exposures - except for (A) those disclosures that are
statements of historical fact and (B) the descriptions of how the
Partnership manages its primary market risk exposures -
constitute forward-looking statements within the meaning of

Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act. The Partnership's primary market risk
exposures as well as the strategies used and to be used by
Demeter and the Trading Advisor for managing such exposures are
subject to numerous uncertainties, contingencies and risks, any
one of which could cause the actual results of the Partnership's
risk controls to differ materially from the objectives of such
strategies. Government interventions, defaults and expro-
priations, illiquid markets, the emergence of dominant
fundamental factors, political upheavals, changes in historical
price relationships, an influx of new market participants,
increased regulation and many other factors could result in
material losses as well as in material changes to the risk
exposures and the risk management strategies of the Partnership.
Investors must be prepared to lose all or substantially all of
their investment in the Partnership.

The following were the primary trading risk exposures of the
Partnership at December 31, 2001, by market sector. It may be
anticipated, however, that these market exposures will vary
materially over time.

Commodity.
Soft Commodities and Agriculturals. At December 31, 2001,
the Partnership had exposure to the markets that comprise
these sectors. Most of the exposure was to the cocoa,
coffee, wheat and corn markets. Supply and demand
inequalities, severe weather disruption and market
expectations affect price movements in these markets.

Metals. The Partnership's metals exposure at December 31,
2001 was to fluctuations in the price of precious metals,
such as gold, silver and to a lesser extent, platinum, and
base metals, such as copper, aluminum, nickel, zinc and
lead. Economic forces, supply and demand inequalities,
geopolitical factors and market expectations influence price
movement in these markets. The Trading Advisor has, from
time to time, taken positions when market opportunities
develop. Demeter anticipates that the Partnership will
continue to be exposed to the precious and base metals
markets.

Energy. At December 31, 2001, the Partnership's energy
exposure was shared primarily by futures contracts in crude

oil and its related products, and natural gas. Price
movements in these markets result from political
developments in the Middle East, weather patterns and other
economic fundamentals. It is possible that volatility will
remain high. Significant profits and losses, which have
been experienced in the past, are expected to continue to be
experienced in these markets. Natural gas has exhibited
volatility in prices resulting from weather patterns and
supply and demand factors and may continue in this choppy
pattern.

Qualitative Disclosures Regarding Non-Trading Risk Exposure
At December 31, 2001, there was no non-trading risk exposure
because the Partnership did not have any foreign currency
balances.

Qualitative Disclosures Regarding Means of Managing Risk Exposure
The Partnership and the Trading Advisor, separately, attempt to
manage the risk of the Partnership's open positions in
essentially the same manner in all market categories traded.
Demeter attempts to manage market exposure by diversifying the
Partnership's assets among different markets and trading
approaches, and monitoring the performance of the Trading Advisor
daily. In addition, the Trading Advisor establishes
diversification guidelines, often set in terms of the maximum

margin to be committed to positions in any one market sector or
market-sensitive instrument.

Demeter monitors and controls the risk of the Partnership's non-
trading instrument, cash. Cash is the only Partnership
investment directed by Demeter, rather than the Trading Advisor.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements are incorporated by reference to the
Partnership's Annual Report, which is filed as Exhibit 13.01
hereto.
Supplementary data specified by Item 302 of Regulation S-K:

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE

None.

PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

There are no directors or executive officers of the Partnership.
The Partnership is managed by Demeter.

Directors and Officers of the General Partner
The directors and officers of Demeter are as follows:

Robert E. Murray, age 41, is the Executive Director of Morgan
Stanley DW's Managed Futures Department, a leading commodity pool
operator with approximately $1.4 billion in assets across a
variety of U.S. and international public and private managed
futures funds. In this capacity, Mr. Murray is responsible for
overseeing all aspects of Morgan Stanley DW's Managed Futures
Department. Mr. Murray began at Dean Witter in 1984 and has been
closely involved in the growth of managed futures at the firm
over the last 17 years. He is also the Chairman and President of
Morgan Stanley Futures & Currency Management Inc. ("MSFCM")
(formerly known as Dean Witter Futures & Currency Management
Inc.), Morgan Stanley's internal commodity trading advisor, and
is Chairman and President of Demeter Management Corporation, the
entity which acts as a general partner for Morgan Stanley DW's
managed futures funds. Mr. Murray has served as the Vice
Chairman and a Director of the Board of the Managed Futures

Association and is currently a member of the Board of Directors
of the National Futures Association. Mr. Murray received a
Bachelors Degree in Finance from Geneseo State University in
1983.

Mitchell M. Merin, age 48, is a Director of Demeter. Mr. Merin
is also a Director of MSFCM. Mr. Merin was appointed the Chief
Operating Officer of Individual Asset Management for MSDW in
December 1998 and the President and Chief Executive Officer of
Morgan Stanley Dean Witter Advisors in February 1998. He has
been an Executive Vice President of Morgan Stanley DW since 1990,
during which time he has been Director of Morgan Stanley DW's
Taxable Fixed Income and Futures divisions, Managing Director in
Corporate Finance and Corporate Treasurer. Mr. Merin received
his Bachelors degree from Trinity College in Connecticut and his
M.B.A. degree in Finance and Accounting from the Kellogg Graduate
School of Management of Northwestern University in 1977.

Joseph G. Siniscalchi, age 56, is a Director of Demeter. Mr.
Siniscalchi joined Morgan Stanley DW in July 1984 as a First Vice
President, Director of General Accounting and served as a Senior
Vice President and Controller for Morgan Stanley DW's Securities
Division through 1997. He is currently Managing Director,

responsible for the Client Support Service Division of Morgan
Stanley DW. From February 1980 to July 1984, Mr. Siniscalchi was
Director of Internal Audit at Lehman Brothers Kuhn Loeb, Inc.

Edward C. Oelsner, III, age 60, is a Director of Demeter. Mr.
Oelsner is currently an Executive Vice President and head of the
Product Development Group at Morgan Stanley Dean Witter Advisors,
an affiliate of Morgan Stanley DW. Mr. Oelsner joined Morgan
Stanley DW in 1981 as a Managing Director in Morgan Stanley DW's
Investment Banking Department specializing in coverage of
regulated industries and, subsequently, served as head of the
Morgan Stanley DW Retail Products Group. Prior to joining Morgan
Stanley DW, Mr. Oelsner held positions at The First Boston
Corporation as a member of the Research and Investment Banking
Departments from 1967 to 1981. Mr. Oelsner received his M.B.A.
in Finance from the Columbia University Graduate School of
Business in 1966 and an A.B. in Politics from Princeton
University in 1964.

Richard A. Beech, age 50, is a Director of Demeter. Mr. Beech
has been associated with the futures industry for over 24 years.
He has been at Morgan Stanley DW since August 1984 where he is
presently an Executive Director and head of Branch Futures. Mr.

Beech began his career at the Chicago Mercantile Exchange, where
he became the Chief Agricultural Economist doing market analysis,
marketing and compliance. Prior to joining Morgan Stanley DW,
Mr. Beech also had worked at two investment banking firms in
operations, research, managed futures and sales management.

Raymond A. Harris, age 45, is currently Managing Director in
Asset Management Services. He previously served as CAO of Morgan
Stanley Dean Witter Asset Management. From July 1982 to July
1994, Mr. Harris served in financial, administrative and other
assignments at Dean Witter Reynolds, Inc. and Dean Witter,
Discover & Co. From August 1994 to January 1999, he worked in
Discover Financial Services and the firm's Credit Service
business units. Mr. Harris has been with Morgan Stanley Dean
Witter & Co. and its affiliates since July 1982. He has a B.A.
degree from Boston College and an M.B.A. in finance from the
University of Chicago.

Anthony J. DeLuca, age 39, became a Director of Demeter on
September 14, 2000. Mr. DeLuca is also a Director of MSFCM. Mr.
DeLuca was appointed the Controller of Asset Management for MSDW
in June 1999. Prior to that, Mr. DeLuca was a partner at the
accounting firm of Ernst & Young LLP, where he had MSDW as a

major client. Mr. DeLuca had worked continuously at Ernst &
Young LLP ever since 1984, after he graduated from Pace
University with a B.B.A. degree in Accounting.

Raymond E. Koch, age 46, is Chief Financial Officer of Demeter.
Mr. Koch began his career at MSDW in 1988, has overseen the
Managed Futures Accounting function since 1992, and is currently
an Executive Director in Investment Management Controllers. From
November 1979 to June 1988, Mr. Koch held various positions at
Thomson McKinnon Securities, Inc. culminating as Manager, Special
Projects in the Capital Markets Division. From August 1977 to
November 1979 he was an auditor, specializing in financial
services at Deloitte Haskins & Sells. Mr. Koch received his
B.B.A. in accounting from Iona College in 1977, an M.B.A. in
finance from Pace University in 1984 and is a Certified Public
Accountant.

All of the foregoing directors have indefinite terms.

Item 11. EXECUTIVE COMPENSATION
The Partnership has no directors and executive officers. As a
limited partnership, the business of the Partnership is managed by
Demeter, which is responsible for the administration of the

business affairs of the Partnership but receives no compensation
for such services.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

(a) Security Ownership of Certain Beneficial Owners - At December
31, 2001, there were no persons known to be beneficial owners of
more than 5 percent of the Units.

(b) Security Ownership of Management - At December 31, 2001,
Demeter owned 43,395.648 Units of General Partnership Interest in
the Partnership representing a 1.95 percent interest in the
Partnership.

(c) Changes in Control - None

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Refer to Note 2 - "Related Party Transactions" of "Notes to
Financial Statements", in the accompanying Annual Report to
Limited Partners for the year ended December 31, 2001, which is
incorporated by reference to Exhibit 13.01 of this Form 10-K. For
the year ended December 31, 2001 the commodity brokers received
brokerage fees (paid and accrued by the Partnership) of $736,436
and the Trading Advisor received a management fee of $400,237.

PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORT ON FORM 8-K
(a) 1. Listing of Financial Statements
The following financial statements and report of independent auditors,
all appearing in the accompanying Annual Report to Limited Partners for
the year ended December 31, 2001, are incorporated by reference to
Exhibit 13.01 of this Form 10-K:
- - Report of Deloitte & Touche LLP, independent auditors, for the
years ended December 31, 2001, 2000 and 1999.

- - Statements of Financial Condition as of December 31, 2001 and
2000.

- - Schedule of Investments as of December 31, 2001.

- - Statements of Operations, Changes in Partners' Capital, and Cash
Flows for the years ended December 31, 2001, 2000 and 1999.

- - Notes to Financial Statements.

With the exception of the aforementioned information and the information
incorporated in Items 7, 8, and 13, the Annual Report to Limited
Partners for the year ended December 31, 2001 is not deemed to be filed
with this report.

2. Listing of Financial Statement Schedules
No financial statement schedules are required to be filed with this
report.

(b) Reports on Form 8-K
During the quarter/year ended December 31, 2001, the following Forms 8-K
were filed by the Partnership:

On April 25, 2001, the Partnership filed the Current Report on Form 8-K
for the purpose of reporting, under Item 5, in connection with the
Partnership becoming part of the Spectrum Series, its change of name,
its entirety with the Trading Advisor an amended and restated management
agreement; and the amendment to such amended and restated management
agreement of the annual incentive fee paid by the Partnership to the
Trading Advisor.

On November 1, 2001, the Partnership filed the Current Report on Form
8-K for the purpose of reporting, under Item 5, the Partnership's change
of name; the relocation of offices of the Partnership and Demeter; and
in connection with the Partnership becoming part of the Spectrum Series,
the amendment to each of the amended and restated customer agreement
between the Partnership and Morgan Stanley DW and the commodity futures
customer agreement between the Partnership and MS & Co. and acknowledged
and agreed to by Morgan Stanley DW.

(c) Exhibits
Refer to Exhibit Index on Page E-1 to E-3.

SIGNATURES

Pursuant to the requirements of Sections 13 or 15(d) 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 SPECTRUM COMMODITY L.P.
(Registrant)

BY: Demeter Management Corporation,
General Partner

March 26, 2002 BY: /s/ Robert E. Murray
Robert E. Murray, Director,
Chairman of the Board and
President

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.

Demeter Management Corporation.

BY: /s/ Robert E. Murray March 26, 2002
Robert E. Murray, Director,
Chairman of the Board and
President

/s/ Mitchell M. Merin March 26, 2002
Mitchell M. Merin, Director

/s/ Joseph G. Siniscalchi March 26, 2002
Joseph G. Siniscalchi, Director

/s/ Edward C. Oelsner III March 26, 2002
Edward C. Oelsner III, Director

/s/ Richard A. Beech March 26, 2002
Richard A. Beech, Director

/s/ Raymond A. Harris March 26, 2002
Raymond A. Harris, Director

/s/ Anthony J. DeLuca March 26, 2002
Anthony J. DeLuca, Director

/s/ Raymond E. Koch March 26, 2002
Raymond E. Koch, Chief
Financial Officer and Principal
Accounting Officer

EXHIBIT INDEX
ITEM
3.01 Form of Amended and Restated Limited Partnership
Agreement of the Partnership is incorporated by
reference to Exhibit A of the Partnership's
Prospectus, dated March 23, 2001, filed with the
Securities and Exchange Commission pursuant to Rule
424(b)(3) under the Securities Act of 1933 on April
6, 2001.
3.02 Certificate of Limited Partnership, dated July 31,
1997, is incorporated by reference to Exhibit 3.02 of
the Partnership's Registration Statement on Form S-1
(File No. 333-33975) filed with the Securities and
Exchange Commission on August 20, 1997.

3.03 Amendment of Certificate of Limited Partnership of
the Partnership, dated March 7, 2000 (changing its
name from Morgan Stanley Tangible Asset Fund L.P.),
is incorporated by reference to Exhibit 3.1 of the
Partnership's Form 8-K (File No. 0-24035) filed with
the Securities and Exchange Commission on March 23,
2000.

3.04 Certificate of Amendment of Certificate of Limited
Partnership, dated November 1, 2001 (changing its
name from Morgan Stanley Dean Witter Spectrum
Commodity L.P.), is incorporated by reference to
Exhibit 3.01 of the Partnership's Form 8-K (File No.
0-24035) filed with the Securities and Exchange
Commission on November 1, 2001.

10.05 Form of Subscription and Exchange Agreement and Power
of Attorney to be executed by each purchaser of Units
is incorporated by reference to Exhibit B of the
Partnership's Prospectus dated March 23, 2001, as
filed with the Securities and Exchange Commission
pursuant to Rule 424 (b)(3) under the Securities Act
of 1933 on April 6, 2001.

10.06 Amended and Restated Escrow Agreement, dated as of
March 10, 2000, among the Partnership, Morgan Stanley
Spectrum Select L.P., Morgan Stanley Spectrum
Technical L.P., Morgan Stanley Spectrum Strategic
L.P., Morgan Stanley Spectrum Global Balanced L.P.,
Morgan Stanley Currency L.P., Morgan Stanley DW, and
The Chase Manhattan Bank, the escrow agent, is
incorporated by reference to Exhibit 10.06 of the
Partnership's Registration Statement on Form S-1
(File No. 333-90483) filed with the Securities and
Exchange Commission on November 2, 2001.

10.07 Form of Subscription Agreement Update Form to be
executed by purchasers of Units is incorporated by
reference to Exhibit C of the Partnership's
Prospectus dated March 23, 2001, as filed with the
Securities and Exchange Commission pursuant to Rule
424 (b)(3) under the Securities Act of 1933 on April
6, 2001.

10.08 Amended and Restated Management Agreement, dated
April 1, 2000, among the Partnership, Demeter, and
Morgan Stanley Commodities Management, Inc. is
incorporated by reference to Exhibit 10.01 of the
Partnership's Form 8-K (File No. 0-24035) filed with
the Securities and Exchange Commission on April 25,
2001.

10.08(a)Amendment to the Amended and Restated Management
Agreement, dated November 30, 2000, among the
Partnership, Demeter and Morgan Stanley Commodities
Management, Inc. is incorporated by reference to
Exhibit 10.02 of the Partnership's Form 8-K (File No.
0-24035) filed with the Securities and Exchange
Commission on April 25, 2001.

10.11 Amended and Restated Customer Agreement between the
Partnership and Morgan Stanley DW, dated as of March
31, 2000, is incorporated by reference to Exhibit
10.01 of the Partnership's Form 8-K (File No. 0-
24035) filed with the Securities and Exchange
Commission on November 1, 2001.

10.12 Commodity Futures Customer Agreement between MS & Co.
and the Partnership, and acknowledged and agreed to
by Morgan Stanley DW, dated as of June 30, 2000, is
incorporated by reference to Exhibit 10.02 of the
Partnership's Form 8-K (File No. 0-24035) filed with
the Securities and Exchange Commission on November 1,
2001.

10.13 Customer Agreement between the Partnership and MSIL,
dated as of June 30, 2000, is incorporated by
reference to Exhibit 10.04 of the Partnership's Form
8-K (File No. 0-24035) filed with the Securities and
Exchange Commission on November 1, 2001.

10.14 Securities Account Control Agreement among the
Partnership, MS & Co., and Morgan Stanley DW, dated
as of June 30, 2000, is incorporated by reference to
Exhibit 10.03 of the Partnership's Form 8-K (File No.
0-24035) filed with the Securities and Exchange
Commission on November 1, 2001.
13.01 December 31, 2001 Annual Report to Limited Partners
is filed herewith.

Morgan Stanley
Spectrum Series

[GRAPHIC]

December 31, 2001
Annual Report

[LOGO] Morgan Stanley

Morgan Stanley Spectrum Series
Historical Fund Performance
Presented below is the percentage change in Net Asset Value per Unit from the
start of every calendar year each Fund has traded. Also provided is the
inception-to-date return and the annualized return since inception for each
Fund. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

Funds
- -----
Spectrum Commodity
Year Return
---- ------
1998 -34.3%
1999 15.8%
2000 3.2%
2001 -25.6%

Inception-to-Date Return: -41.6%
Annualized Return: -12.6%
- ----------------------------------------------------------------------

Spectrum Currency
Year Return
---- ------
2000 (6 months) 11.7%
2001 11.1%
Inception-to-Date Return: 24.1%
Annualized Return: 15.5%
- ----------------------------------------------------------------------

Spectrum Global Balanced
Year Return Year Return
- ---- ------ ---- ------
1994 (2 months) -1.7% 1998 16.4%
1995 22.8% 1999 0.7%
1996 -3.6% 2000 0.9%
1997 18.2% 2001 -0.3%
Inception-to-Date Return: 62.1%
Annualized Return: 7.0%
- ----------------------------------------------------------------------

Spectrum Select
Year Return Year Return
- ---- ------ ---- ------
1991 (5 months) 31.2% 1996 5.3%
1992 -14.4% 1997 6.2%
1993 41.6% 1998 14.2%
1994 -5.1% 1999 -7.6%
1995 23.6% 2000 7.1%
2001 1.7%
Inception-to-Date Return: 139.6%
Annualized Return: 8.8%
- ----------------------------------------------------------------------

Spectrum Strategic
Year Return Year Return
- ---- ------ ---- ------
1994 (2 months) 0.1% 1998 7.8%
1995 10.5% 1999 37.2%
1996 -3.5% 2000 -33.1%
1997 0.4% 2001 -0.6%
Inception-to-Date Return: 5.5%
Annualized Return: 0.8%
- ----------------------------------------------------------------------

Spectrum Technical
Year Return Year Return
- ---- ------ ---- ------
1994 (2 months) -2.2% 1998 10.2%
1995 17.6% 1999 -7.5%
1996 18.3% 2000 7.8%
1997 7.5% 2001 -7.2%
Inception-to-Date Return: 49.3%
Annualized Return: 5.8%

Demeter Management Corporation
c/o Managed Futures Department
825 Third Avenue, 8th Floor
New York, NY 10022
Telephone (201) 876-4647

Morgan Stanley Spectrum Series
Annual Report
2001

Dear Limited Partner:

This marks the eighth annual report for Morgan Stanley Spectrum Global
Balanced, Morgan Stanley Spectrum Strategic and Morgan Stanley Spectrum
Technical, the eleventh annual report for Morgan Stanley Spectrum Select, the
fourth annual report for Morgan Stanley Spectrum Commodity and the second
annual report for Morgan Stanley Spectrum Currency. The Net Asset Value per
Unit for each of the six Morgan Stanley Spectrum Funds as of December 31, 2001
was as follows:

Funds N.A.V. % change for year
----- ------ -----------------

Spectrum Commodity $ 5.84 -25.6%
Spectrum Currency $12.41 11.1%
Spectrum Global Balanced $16.21 -0.3%
Spectrum Select $23.96 1.7%
Spectrum Strategic $10.55 -0.6%
Spectrum Technical $14.93 -7.2%

Spectrum Commodity

During the year, the Fund recorded a decrease in Net Asset Value per Unit. The
most significant losses were experienced in the energy markets throughout a
majority of the year from long positions in natural gas futures as prices
reversed the sharp upward trend experienced in late 2000 amid reports of
increased inventories and forecasts for favorable weather. In the metals
markets, losses were experienced throughout a majority of the year from long
positions in copper and aluminum futures as the slowdown in the U.S. economy
and weak demand drove prices lower. In the agricultural markets, losses were
incurred from long positions in corn and wheat futures as prices moved lower
due to favorable weather forecasts and on reports of declining demand. In the
soft commodities markets, losses were recorded throughout a majority of the
year from long cotton futures positions as prices moved lower on weak export
sales and low demand.

Spectrum Currency

During the year, the Fund recorded an increase in Net Asset Value per Unit. The
most significant gains were recorded primarily in the South African rand from
previously established short positions in September, November and December as
its value trended lower relative to the U.S. dollar on global economic jitters
and emerging market concerns following Argentina's debt default. Profits were
recorded from previously established short positions in the Japanese yen early
in the year and again in December as the value of the yen weakened relative to
the U.S. dollar on continuing concerns for the Japanese economy. A portion of
the Fund's overall gains was partially offset by losses recorded in the British
pound primarily during May and early June from previously established long
positions as its value reversed lower relative to the U.S. dollar in reaction
to reports that British Prime Minister Blair will push for Great Britain's
entry into the European Monetary Union.

Spectrum Global Balanced

During the year, the Fund recorded a decrease in Net Asset Value per Unit. The
most significant losses were incurred primarily in the global stock index
futures markets throughout a majority of the first three quarters from long
positions in FTSE, DAX and S&P 500 Index futures as equity prices moved lower
amid worries regarding global economic uncertainty. In the energy markets,
losses were recorded throughout the year from positions in crude oil futures
and its related products as a result of volatility in oil prices due to a
continually changing outlook for supply, production and demand. A portion of
the Fund's overall losses was partially offset by gains recorded in the global
interest rate futures markets primarily during January and again in the third
quarter from previously established long positions in U.S. and European
interest rate futures as prices trended higher amid continued economic concerns
and interest rate cuts by the U.S. and European central banks. In the currency
markets, profits were recorded throughout a majority of the fourth quarter from
previously established short positions in the South African rand as its value
trended lower relative to the U.S. dollar while global economic jitters
persisted.

Spectrum Select

During the year, the Fund recorded an increase in Net Asset Value per Unit. The
most significant gains were recorded primarily in the global interest rate
futures markets during August, September and October from previously
established long positions in U.S. interest rate futures as prices trended
higher following interest rate cuts by the U.S. and European central banks. In
the global stock index futures markets, profits were recorded throughout a
majority of the third quarter from previously established short positions in
DAX, Hang Seng, Nikkei and S&P 500 Index futures as the trend in equity prices
continued sharply lower amid worries regarding global economic uncertainty. A
portion of the Fund's overall gains was partially offset by losses recorded in
the energy markets throughout a majority of the fourth quarter from volatile
price movement in natural gas futures as a result of a continually changing
outlook for supply, production and demand.

Spectrum Strategic

During the year, the Fund recorded a decrease in Net Asset Value per Unit. The
most significant losses were experienced primarily in the currency markets
throughout a majority of the fourth quarter from transactions involving the
euro and Swiss franc. In the global stock index futures markets, losses were
experienced throughout a majority of the first quarter from long positions in
U.S. stock index futures as U.S. stock prices declined after discouraging
corporate earnings warnings, inflationary news and on worries of a U.S.
economic slowdown. A portion of the Fund's overall losses was partially offset
by gains recorded in the soft commodities markets primarily during September
and November from long cocoa futures positions as prices soared higher on
expectations that global demand will outpace production. Additional gains were
recorded primarily during April, May and December from long lumber futures
positions as prices increased amid low inventories and on hopes of a pickup in
the U.S. economy.

Limited Partners of Spectrum Strategic are advised of a change in trading
personnel at one of the trading advisors employed by the Fund. Effective
January 1, 2002, Allied Irish Capital Management, Ltd., a trading advisor

to the Fund, announced the retirement of Mr. David Tease, a Director of Allied
Irish. Allied Irish trades its allocated portion of Fund assets pursuant to the
Worldwide Financial Futures Program, a portion of which was traded by Mr.
Tease, as discussed on page 101 of the Prospectus dated March 23, 2001.
Commencing on or about January 17, 2002, that portion of the Worldwide
Financial Futures Program previously traded by Mr. Tease (approximately $8.1
million, or 11.8% of Fund assets) is being traded by Mr. Gerry Grimes. Mr.
Grimes is Managing Director and a founding member of Allied Irish, with nearly
twenty years of experience in investment management. Mr. Grimes will employ a
discretionary trading approach based upon his fundamental economic analysis of
markets. He believes that the positioning of individual markets is a critical
factor in determining trading opportunities. Hence, he will place strong
emphasis on the gathering of intelligence in relation to market sentiment and
trade flow indicators to determine how individual markets are positioned. Mr.
Grimes will attempt to profit from those instances in which he determines that
a market is positioned in a manner contrary to his own fundamental view.
Pre-determined stop loss levels will be applied to all trades in an effort to
manage trade risk. In addition to trading a portion of the Fund's assets, Mr.
Grimes will continue in his role as trading controller for all three programs
employed in the Worldwide Financial Futures Program.

Spectrum Technical

During the year, the Fund recorded a decrease in Net Asset Value per Unit. The
most significant losses were recorded primarily in the energy markets
throughout the first nine months of the year from trading in crude oil futures
and its related products as a result of volatility in oil prices due to a
continually changing outlook for supply, production and demand. A portion of
the Fund's overall losses was partially offset by gains recorded in the global
interest rate futures markets primarily during August, September and October
from previously established long positions in U.S. interest rate futures as
prices trended higher following interest rate cuts by the U.S. and European
central banks. In the global stock index futures markets, profits were recorded
throughout a majority of the third quarter from previously established short
positions in DAX and Nikkei index futures as the trend in equity prices con-

tinued sharply lower amid worries regarding global economic uncertainty.

Should you have any questions concerning this report, please feel free to
contact Demeter Management Corporation, c/o Managed Futures Department, 825
Third Avenue, 8th Floor, New York, NY 10022 or your Morgan Stanley Financial
Advisor.

I hereby affirm, that to the best of my knowledge and belief, the information
contained in this report is accurate and complete. Past performance is not a
guarantee of future results.

Sincerely,

/s/ Robert Murray
Robert E. Murray
Chairman
Demeter Management Corporation
General Partner

Morgan Stanley Spectrum Series
(formerly, Morgan Stanley Dean Witter Spectrum Series)

Independent Auditors' Report

To the Limited Partners and the General Partner of
Morgan Stanley Spectrum Commodity L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Commodity L.P.),
Morgan Stanley Spectrum Currency L.P. (formerly, Morgan Stanley Dean Witter
Spectrum Currency L.P.),
Morgan Stanley Spectrum Global Balanced L.P. (formerly, Morgan Stanley Dean
Witter Spectrum Global Balanced L.P.),
Morgan Stanley Spectrum Select L.P. (formerly, Morgan Stanley Dean Witter
Spectrum Select L.P.),
Morgan Stanley Spectrum Strategic L.P. (formerly, Morgan Stanley Dean Witter
Spectrum Strategic L.P.), and Morgan Stanley Spectrum Technical L.P. (formerly,
Morgan Stanley Dean Witter Spectrum Technical L.P.):

We have audited the accompanying statements of financial condition of Morgan
Stanley Spectrum Commodity L.P., Morgan Stanley Spectrum Currency L.P.
("Spectrum Currency"), Morgan Stanley Spectrum Global Balanced L.P., Morgan
Stanley Spectrum Select L.P., Morgan Stanley Spectrum Strategic L.P., and
Morgan Stanley Spectrum Technical L.P. (collectively, the "Partnerships") as of
December 31, 2001 and 2000, including the schedules of investments as of
December 31, 2001, and the related statements of operations, changes in
partners' capital, and cash flows for the period from July 3, 2000
(commencement of operations) to December 31, 2000 and the year ended December
31, 2001 for Spectrum Currency, and for each of the three years in the period
ended December 31, 2001 for the other above mentioned Partnerships. These
financial statements are the responsibility of the Partnerships' management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating

the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the financial position of Morgan Stanley Spectrum Commodity L.P.,
Morgan Stanley Spectrum Currency L.P., Morgan Stanley Spectrum Global Balanced
L.P., Morgan Stanley Spectrum Select L.P., Morgan Stanley Spectrum Strategic
L.P., and Morgan Stanley Spectrum Technical L.P. as of December 31, 2001 and
2000, and the results of their operations and their cash flows for the period
from July 3, 2000 (commencement of operations) to December 31, 2000 and the
year ended December 31, 2001 for Spectrum Currency, and for each of the three
years in the period ended December 31, 2001 for the other above mentioned
Partnerships, in conformity with accounting principles generally accepted in
the United States of America.

/s/ Deloitte & Touche LLP

New York, New York
February 15, 2002
(February 27, 2002 as to Note 7)

Morgan Stanley Spectrum Commodity L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Commodity L.P.)
Statements of Financial Condition

December 31,
---------------------
2001 2000
---------- ----------
$ $

ASSETS
Equity in futures interests trading accounts:
Cash 12,980,361 20,529,979
Net unrealized gain on open contracts (MS&Co.) 289,317 160,096
Net unrealized gain (loss) on open contracts (MSIL) 77,762 (185,379)
---------- ----------
Total net unrealized gain (loss) on open contracts 367,079 (25,283)
---------- ----------
Total Trading Equity 13,347,440 20,504,696
Subscriptions receivable 108,050 215,897
Interest receivable (Morgan Stanley DW and
MS&Co.) 17,129 89,128
---------- ----------
Total Assets 13,472,619 20,809,721
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES
Redemptions payable 417,678 489,923
Accrued brokerage fees (Morgan Stanley DW and
MS&Co.) 52,001 77,628
Accrued management fees (MSCM) 28,261 42,189
---------- ----------
Total Liabilities 497,940 609,740
---------- ----------
PARTNERS' CAPITAL
Limited Partners (2,180,009.505 and 2,530,392.671
Units, respectively) 12,721,444 19,859,397
General Partner (43,395.648 Units) 253,235 340,584
---------- ----------
Total Partners' Capital 12,974,679 20,199,981
---------- ----------
Total Liabilities and Partners' Capital 13,472,619 20,809,721
========== ==========
NET ASSET VALUE PER UNIT 5.84 7.85
========== ==========

Statements of Operations

For the Years Ended
December 31,
--------------------------------
2001 2000 1999
---------- --------- ---------
$ $ $

REVENUES
Trading profit (loss):
Realized (4,662,750) 1,696,824 3,003,270
Net change in unrealized 392,362 (567,711) 1,178,071
---------- --------- ---------
Total Trading Results (4,270,388) 1,129,113 4,181,341
Interest income (Morgan Stanley DW and
MS&Co.) 518,759 1,047,350 864,383
---------- --------- ---------
Total (3,751,629) 2,176,463 5,045,724
---------- --------- ---------
EXPENSES
Brokerage fees (Morgan Stanley DW and
MS&Co.) 736,436 949,310 852,484
Management fees (MSCM) 400,237 546,187 583,893
Service fees (Demeter) -- 58,604 233,558
---------- --------- ---------
Total 1,136,673 1,554,101 1,669,935
---------- --------- ---------
NET INCOME (LOSS) (4,888,302) 622,362 3,375,789
========== ========= =========
Net Income (Loss) Allocation:
Limited Partners (4,800,953) 612,086 3,330,798
General Partner (87,349) 10,276 44,991
Net Income (Loss) per Unit:
Limited Partners (2.01) .24 1.04
General Partner (2.01) .24 1.04

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Currency L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Currency L.P.)
Statements of Financial Condition

December 31,
---------------------
2001 2000
---------- ----------
$ $

ASSETS
Equity in futures interests trading accounts:
Cash 43,241,135 14,391,541
Net unrealized gain on open contracts (MS&Co.) 3,178,383 555,569
---------- ----------
Total Trading Equity 46,419,518 14,947,110
Subscriptions receivable 2,642,117 3,054,150
Interest receivable (Morgan Stanley DW) 50,588 55,464
---------- ----------
Total Assets 49,112,223 18,056,724
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES
Accrued incentive fees 913,255 32,876
Redemptions payable 165,224 2,237,351
Accrued brokerage fees (Morgan Stanley DW) 154,729 55,245
Accrued management fees 67,274 24,020
---------- ----------
Total Liabilities 1,300,482 2,349,492
---------- ----------
PARTNERS' CAPITAL
Limited Partners (3,674,315.446 and 1,252,545.441 Units,
respectively) 45,598,611 13,988,414
General Partner (178,332.987 and 153,905.792 Units, respectively) 2,213,130 1,718,818
---------- ----------
Total Partners' Capital 47,811,741 15,707,232
---------- ----------
Total Liabilities and Partners' Capital 49,112,223 18,056,724
========== ==========
NET ASSET VALUE PER UNIT 12.41 11.17
========== ==========

Statements of Operations

For the Period from
July 3, 2000
For the (commencement of
Year Ended operations) to
December 31, December 31,
2001 2000
-------------- -------------------
$ $

REVENUES
Trading profit:
Realized 3,998,924 1,126,201
Net change in unrealized 2,622,814 555,569
-------------- ---------
Total Trading Results 6,621,738 1,681,770
Interest income (Morgan Stanley DW) 731,716 236,461
-------------- ---------
Total 7,353,454 1,918,231
-------------- ---------
EXPENSES
Brokerage fees (Morgan Stanley DW) 1,297,698 249,571
Incentive fees 1,155,201 188,423
Management fees 564,216 171,693
-------------- ---------
Total 3,017,115 609,687
-------------- ---------
NET INCOME 4,336,339 1,308,544
============== =========
Net Income Allocation:
Limited Partners 4,119,027 1,134,371
General Partner 217,312 174,173

Net Income per Unit:
Limited Partners 1.24 1.17
General Partner 1.24 1.17

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Global Balanced L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Global Balanced L.P.)

Statements of Financial Condition

December 31,
----------------------
2001 2000
---------- ----------
$ $

ASSETS
Equity in futures interests trading accounts:
Cash 57,396,091 52,414,304
Net unrealized gain on open contracts (MS&Co.) 839,855 3,384,377
Net unrealized loss on open contracts (MSIL) (150,647) (66,733)
---------- ----------
Total net unrealized gain on open contracts 689,208 3,317,644
Net option premiums -- 192,500
---------- ----------
Total Trading Equity 58,085,299 55,924,448
Subscriptions receivable 611,641 530,634
Interest receivable (Morgan Stanley DW) 93,818 285,054
---------- ----------
Total Assets 58,790,758 56,740,136
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES
Redemptions payable 725,284 602,490
Accrued brokerage fees (Morgan Stanley DW) 219,946 202,789
Accrued management fees 59,768 55,107
---------- ----------
Total Liabilities 1,004,998 860,386
---------- ----------
PARTNERS' CAPITAL
Limited Partners (3,524,663.525 and 3,396,880.702 Units,
respectively) 57,127,967 55,220,008
General Partner (40,584.304 Units) 657,793 659,742
---------- ----------
Total Partners' Capital 57,785,760 55,879,750
---------- ----------
Total Liabilities and Partners' Capital 58,790,758 56,740,136
========== ==========
NET ASSET VALUE PER UNIT 16.21 16.26
========== ==========

Statements of Operations

For the Years Ended
December 31,
----------------------------------
2001 2000 1999
---------- ---------- ----------
$ $ $

REVENUES
Trading profit (loss):
Realized 3,618,628 (2,091,009) 2,425,585
Net change in unrealized (2,628,436) 2,507,530 (1,157,073)
---------- ---------- ----------
Total Trading Results 990,192 416,521 1,268,512
Interest income (Morgan Stanley DW) 2,160,076 3,275,958 2,385,751
---------- ---------- ----------
Total 3,150,268 3,692,479 3,654,263
---------- ---------- ----------
EXPENSES
Brokerage fees (Morgan Stanley DW) 2,597,121 2,558,008 2,387,515
Management fees 705,746 695,117 648,787
Incentive fees -- -- 215,651
---------- ---------- ----------
Total 3,302,867 3,253,125 3,251,953
---------- ---------- ----------
NET INCOME (LOSS) (152,599) 439,354 402,310
========== ========== ==========
Net Income (Loss) Allocation:
Limited Partners (150,650) 433,786 397,258
General Partner (1,949) 5,568 5,052
Net Income (Loss) per Unit:
Limited Partners (.05) .14 .12
General Partner (.05) .14 .12

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Select L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Select L.P.)

Statements of Financial Condition

December 31,
------------------------
2001 2000
----------- -----------
$ $

ASSETS
Equity in futures interests trading accounts:
Cash 235,183,061 196,555,362
Net unrealized gain on open contracts (MS&Co.) 7,164,265 26,063,382
Net unrealized loss on open contracts (MSIL) (1,767,529) (511,085)
----------- -----------
Total net unrealized gain on open contracts 5,396,736 25,552,297
Net option premiums 167,063 --
----------- -----------
Total Trading Equity 240,746,860 222,107,659
Subscriptions receivable 4,991,166 1,583,941
Interest receivable (Morgan Stanley DW) 305,356 889,954
----------- -----------
Total Assets 246,043,382 224,581,554
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES
Redemptions payable 2,595,426 2,110,529
Accrued brokerage fees (Morgan Stanley DW) 1,440,360 1,231,479
Accrued management fees 596,011 509,577
----------- -----------
Total Liabilities 4,631,797 3,851,585
----------- -----------
PARTNERS' CAPITAL
Limited Partners (9,966,639.126 and 9,255,010.627
Units, respectively) 238,821,840 218,182,118
General Partner (108,076.600 Units) 2,589,745 2,547,851
----------- -----------
Total Partners' Capital 241,411,585 220,729,969
----------- -----------
Total Liabilities and Partners' Capital 246,043,382 224,581,554
=========== ===========
NET ASSET VALUE PER UNIT 23.96 23.57
=========== ===========

Statements of Operations

For the Years Ended
December 31,
-----------------------------------
2001 2000 1999
----------- ---------- -----------
$ $ $

REVENUES
Trading profit (loss):
Realized 43,420,724 6,845,291 (1,351,849)
Net change in unrealized (20,155,561) 18,665,233 (1,547,990)
----------- ---------- -----------
Total Trading Results 23,265,163 25,510,524 (2,899,839)
Interest income (Morgan Stanley DW) 7,203,732 9,573,095 7,678,789
----------- ---------- -----------
Total 30,468,895 35,083,619 4,778,950
----------- ---------- -----------
EXPENSES
Brokerage fees (Morgan Stanley DW) 17,183,347 14,706,945 15,188,479
Management fees 7,110,346 6,085,629 6,284,885
Incentive fees 3,009,853 -- --
----------- ---------- -----------
Total 27,303,546 20,792,574 21,473,364
----------- ---------- -----------
NET INCOME (LOSS) 3,165,349 14,291,045 (16,694,414)
=========== ========== ===========
Net Income (Loss) Allocation:
Limited Partners 3,123,455 14,165,099 (16,455,697)
General Partner 41,894 125,946 (238,717)
Net Income (Loss) per Unit:
Limited Partners .39 1.57 (1.80)
General Partner .39 1.57 (1.80)

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Strategic L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Strategic L.P.)

Statements of Financial Condition

December 31,
--------------------------
2001 2000
-------------- ----------
$ $

ASSETS
Equity in futures interests trading accounts:
Cash 65,967,662 73,445,827
Net unrealized gain on open contracts (MS&Co.) 4,515,344 1,936,658
Net unrealized gain (loss) on open contracts
(MSIL) (23,578) 58,457
Net unrealized loss on open contracts (Carr) -- (8,983)
-------------- ----------
Total net unrealized gain on open contracts 4,491,766 1,986,132
Net option premiums 288,552 226,200
-------------- ----------
Total Trading Equity 70,747,980 75,658,159
Subscriptions receivable 651,936 462,060
Interest receivable (Morgan Stanley DW) 89,359 306,879
-------------- ----------
Total Assets 71,489,275 76,427,098
============== ==========
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES
Redemptions payable 2,072,098 1,307,093
Accrued brokerage fees (Morgan Stanley DW) 424,242 409,292
Accrued management fees 175,549 186,577
Accrued incentive fee -- 289,687
-------------- ----------
Total Liabilities 2,671,889 2,192,649
-------------- ----------
PARTNERS' CAPITAL
Limited Partners (6,449,326.013 and 6,919,445.814
Units, respectively) 68,012,216 73,433,119
General Partner (76,351.101 and 75,507.615 Units,
respectively) 805,170 801,330
-------------- ----------
Total Partners' Capital 68,817,386 74,234,449
-------------- ----------
Total Liabilities and
Partners' Capital 71,489,275 76,427,098
============== ==========
NET ASSET VALUE PER UNIT 10.55 10.61
============== ==========

Statements of Operations

For the Years Ended
December 31,
-----------------------------------
2001 2000 1999
---------- ----------- ----------
$ $ $

REVENUES
Trading profit (loss):
Realized 2,132,212 (23,193,914) 32,274,037
Net change in unrealized 2,505,634 (7,577,681) 4,264,478
---------- ----------- ----------
Total Trading Results 4,637,846 (30,771,595) 36,538,515
Interest income (Morgan Stanley DW) 2,217,963 3,832,634 3,017,103
---------- ----------- ----------
Total 6,855,809 (26,938,961) 39,555,618
---------- ----------- ----------
EXPENSES
Brokerage fees (Morgan Stanley DW) 5,152,756 5,798,093 5,837,887
Management fees 2,183,596 2,880,999 3,137,509
Incentive fees -- 1,269,237 2,451,152
---------- ----------- ----------
Total 7,336,352 9,948,329 11,426,548
---------- ----------- ----------
NET INCOME (LOSS) (480,543) (36,887,290) 28,129,070
========== =========== ==========
Net Income (Loss) Allocation:
Limited Partners (475,383) (36,503,461) 27,829,050
General Partner (5,160) (383,829) 300,020
Net Income (Loss) per Unit:
Limited Partners (0.06) (5.24) 4.30
General Partner (0.06) (5.24) 4.30

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Technical L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Technical L.P.)

Statements of Financial Condition

December 31,
------------------------
2001 2000
----------- -----------
$ $

ASSETS
Equity in futures interests trading accounts:
Cash 246,172,354 231,502,090
Net unrealized gain on open contracts (MS&Co.) 14,299,794 41,877,552
Net unrealized loss on open contracts (MSIL) (2,794,179) (1,835,243)
----------- -----------
Total net unrealized gain on open contracts 11,505,615 40,042,309
----------- -----------
Total Trading Equity 257,677,969 271,544,399
Subscriptions receivable 4,445,562 1,087,585
Interest receivable (Morgan Stanley DW) 318,673 1,063,044
----------- -----------
Total Assets 262,442,204 273,695,028
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES
Redemptions payable 2,377,346 3,432,384
Accrued brokerage fees (Morgan Stanley DW) 1,509,205 1,458,126
Accrued management fees 581,531 559,827
Accrued incentive fee -- 111,599
----------- -----------
Total Liabilities 4,468,082 5,561,936
----------- -----------
PARTNERS' CAPITAL
Limited Partners (17,089,473.684 and 16,479,195.979
Units, respectively) 255,122,417 265,060,579
General Partner (191,022.517 Units) 2,851,705 3,072,513
----------- -----------
Total Partners' Capital 257,974,122 268,133,092
----------- -----------
Total Liabilities and Partners' Capital 262,442,204 273,695,028
=========== ===========
NET ASSET VALUE PER UNIT 14.93 16.08
=========== ===========

Statements of Operations

For the Years Ended
December 31,
-----------------------------------
2001 2000 1999
----------- ---------- -----------
$ $ $

REVENUES
Trading profit (loss):
Realized 30,115,483 12,255,064 726,179
Net change in unrealized (28,536,694) 22,006,013 (872,972)
----------- ---------- -----------
Total Trading Results 1,578,789 34,261,077 (146,793)
Interest income (Morgan Stanley DW) 8,288,660 11,613,896 9,593,178
----------- ---------- -----------
Total 9,867,449 45,874,973 9,446,385
----------- ---------- -----------
EXPENSES
Brokerage fees (Morgan Stanley DW) 19,556,056 17,835,223 19,176,380
Management fees 7,501,053 9,595,464 10,580,071
Incentive fees 2,093,709 166,085 430,097
----------- ---------- -----------
Total 29,150,818 27,596,772 30,186,548
----------- ---------- -----------
NET INCOME (LOSS) (19,283,369) 18,278,201 (20,740,163)
=========== ========== ===========
Net Income (Loss) Allocation:
Limited Partners (19,062,561) 18,053,408 (20,531,494)
General Partner (220,808) 224,793 (208,669)
Net Income (Loss) per Unit:
Limited Partners (1.15) 1.17 (1.21)
General Partner (1.15) 1.17 (1.21)

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Series
(formerly, Morgan Stanley Dean Witter Spectrum Series)

Statements of Changes in Partners' Capital
For the Years Ended December 31, 2001, 2000 and 1999

Units of
Partnership Limited General
Interest Partners Partner Total
------------- ---------- ------- ----------
$ $ $

Morgan Stanley Spectrum Commodity L.P.
(formerly, Morgan Stanley Dean Witter Spectrum
Commodity L.P.)
Partners' Capital,
December 31, 1998 3,788,464.700 24,622,999 285,317 24,908,316
Net income -- 3,330,798 44,991 3,375,789
Redemptions (682,597.530) (4,643,635) -- (4,643,635)
------------- ---------- ------- ----------
Partners' Capital,
December 31, 1999 3,105,867.170 23,310,162 330,308 23,640,470
Offering of Units 277,607.062 2,115,964 -- 2,115,964
Net income -- 612,086 10,276 622,362
Redemptions (809,685.913) (6,178,815) -- (6,178,815)
------------- ---------- ------- ----------
Partners' Capital,
December 31, 2000 2,573,788.319 19,859,397 340,584 20,199,981
Offering of Units 287,171.772 1,838,372 -- 1,838,372
Net loss -- (4,800,953) (87,349) (4,888,302)
Redemptions (637,554.938) (4,175,372) -- (4,175,372)
------------- ---------- ------- ----------
Partners' Capital,
December 31, 2001 2,223,405.153 12,721,444 253,235 12,974,679
============= ========== ======= ==========

Statements of Changes in Partners' Capital
For the Year Ended December 31, 2001 and the period from July 3, 2000
(commencement of operations) to December 31, 2000

Units of
Partnership Limited General
Interest Partners Partner Total
------------- ---------- --------- ----------
$ $ $

Morgan Stanley Spectrum Currency L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Currency L.P.)
Partners' Capital,
July 3, 2000
(commencement of
operations) 2.000 10 10 20
Initial Offering 633,152.332 4,886,888 1,444,635 6,331,523
Offering of Units 980,783.417 10,281,803 100,000 10,381,803
Net income -- 1,134,371 174,173 1,308,544
Redemptions (207,486.516) (2,314,658) -- (2,314,658)
------------- ---------- --------- ----------
Partners' Capital,
December 31, 2000 1,406,451.233 13,988,414 1,718,818 15,707,232
Offering of Units 2,572,156.095 28,921,302 277,000 29,198,302
Net income -- 4,119,027 217,312 4,336,339
Redemptions (125,958.895) (1,430,132) -- (1,430,132)
------------- ---------- --------- ----------
Partners' Capital,
December 31, 2001 3,852,648.433 45,598,611 2,213,130 47,811,741
============= ========== ========= ==========

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Series
(formerly, Morgan Stanley Dean Witter Spectrum Series)

Statements of Changes in Partners' Capital
For the Years Ended December 31, 2001, 2000 and 1999

Units of
Partnership Limited General
Interest Partners Partner Total
------------- ----------- ------- -----------
$ $ $

Morgan Stanley Spectrum Global Balanced L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Global
Balanced L.P.)
Partners' Capital,
December 31, 1998 2,869,073.505 45,399,750 514,122 45,913,872
Offering of Units 1,019,759.235 16,184,278 135,000 16,319,278
Net income -- 397,258 5,052 402,310
Redemptions (299,009.049) (4,771,448) -- (4,771,448)
------------- ----------- ------- -----------
Partners' Capital,
December 31, 1999 3,589,823.691 57,209,838 654,174 57,864,012
Offering of Units 568,088.752 8,983,545 -- 8,983,545
Net income -- 433,786 5,568 439,354
Redemptions (720,447.437) (11,407,161) -- (11,407,161)
------------- ----------- ------- -----------
Partners' Capital,
December 31, 2000 3,437,465.006 55,220,008 659,742 55,879,750
Offering of Units 640,074.598 10,254,342 -- 10,254,342
Net loss -- (150,650) (1,949) (152,599)
Redemptions (512,291.775) (8,195,733) -- (8,195,733)
------------- ----------- ------- -----------
Partners' Capital,
December 31, 2001 3,565,247.829 57,127,967 657,793 57,785,760
============= =========== ======= ===========

Units of
Partnership Limited General
Interest Partners Partner Total
-------------- ----------- --------- -----------
$ $ $

Morgan Stanley Spectrum Select L.P.
(formerly, Morgan Stanley Dean Witter Spectrum Select L.P.)
Partners' Capital,
December 31, 1998 8,407,766.751 196,915,644 3,166,872 200,082,516
Offering of Units 2,238,093.744 51,589,367 -- 51,589,367
Net loss -- (16,455,697) (238,717) (16,694,414)
Redemptions (928,973.063) (21,171,795) -- (21,171,795)
-------------- ----------- --------- -----------
Partners' Capital,
December 31, 1999 9,716,887.432 210,877,519 2,928,155 213,805,674
Offering of Units 1,339,972.159 28,581,403 -- 28,581,403
Net income -- 14,165,099 125,946 14,291,045
Redemptions (1,693,772.364) (35,441,903) (506,250) (35,948,153)
-------------- ----------- --------- -----------
Partners' Capital,
December 31, 2000 9,363,087.227 218,182,118 2,547,851 220,729,969
Offering of Units 1,676,778.529 41,261,535 -- 41,261,535
Net income -- 3,123,455 41,894 3,165,349
Redemptions (965,150.030) (23,745,268) -- (23,745,268)
-------------- ----------- --------- -----------
Partners' Capital,
December 31, 2001 10,074,715.726 238,821,840 2,589,745 241,411,585
============== =========== ========= ===========

The accompanying notes are an integral part of these financial statements.

Morgan Stanley Spectrum Series
(formerly, Morgan Stanley Dean Witter Spectrum Series)

Statements of Changes in Partners' Capital
For the Years Ended December 31, 2001, 2000 and 1999