UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)



|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarter ended: March 31, 2008

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: 0-26004

DIVERSIFIED FUTURES TRUST I

(Exact name of registrant as specified in its charter)



|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 13-3780260                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)



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

(914) 307-7000

(Registrants telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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 is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of accelerated filer, large
accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one):



|                           |  |                             
|-------------------------- |  | ----------------------------
|Large accelerated filer   ̈ |  | Accelerated filer   ̈        
|Non-accelerated filer  x   |  | Smaller Reporting Company   ̈

Indicate by check mark whether Registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).     Yes   ̈    No  x









---

DIVERSIFIED FUTURES TRUST I

INDEX TO QUARTERLY REPORT ON FORM 10-Q

MARCH 31, 2008



|                               |  |                                                                                                                    |  |     
|------------------------------ |  | ------------------------------------------------------------------------------------------------------------------ |  | ----
|                               |  |                                                                                                                    |  | Page
|PART I  FINANCIAL INFORMATION |  | 3                                                                                                                 
|                               |  |                                                                                                                   
|Item 1.                        |  | Financial Statements                                                                                               |  | 4   
|                               |  |                                                                                                                   
|                               |  | Diversified Futures Trust I:                                                                                       |  |     
|                               |  |                                                                                                                   
|                               |  | Condensed Statements of Financial Condition as of March 31, 2008 (Unaudited) and December 31, 2007                 |  | 5   
|                               |  |                                                                                                                   
|                               |  | Condensed Statements of Operations (Unaudited) for the Three Months Ended March 31, 2008 and 2007                  |  | 6   
|                               |  |                                                                                                                   
|                               |  | Condensed Statements of Changes in Trust Capital (Unaudited) for the Three Months Ended March 31, 2008 and 2007    |  | 7   
|                               |  |                                                                                                                   
|                               |  | Notes to Condensed Financial Statements (Unaudited)                                                                |  | 8   
|                               |  |                                                                                                                   
|                               |  | WCM Pool LLC:                                                                                                      |  |     
|                               |  |                                                                                                                   
|                               |  | Condensed Statements of Financial Condition as of March 31, 2008 (Unaudited) and December 31, 2007                 |  | 17  
|                               |  |                                                                                                                   
|                               |  | Condensed Schedules of Investments as of March 31, 2008 (Unaudited) and December 31, 2007                          |  | 18  
|                               |  |                                                                                                                   
|                               |  | Condensed Statements of Operations (Unaudited) for the Three Months Ended March 31, 2008 and 2007                  |  | 19  
|                               |  |                                                                                                                   
|                               |  | Condensed Statements of Changes in Members Capital (Unaudited) for the Three Months Ended March 31, 2008 and 2007 |  | 20  
|                               |  |                                                                                                                   
|                               |  | Notes to Condensed Financial Statements (Unaudited)                                                                |  | 21  
|                               |  |                                                                                                                   
|Item 2.                        |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                              |  | 28  
|                               |  |                                                                                                                   
|Item 3.                        |  | Quantitative and Qualitative Disclosures About Market Risk                                                         |  | 38  
|                               |  |                                                                                                                   
|Item 4.                        |  | Controls and Procedures                                                                                            |  | 38  
|                               | 
|PART II  OTHER INFORMATION    |  | 38                                                                                                                
|                               |  |                                                                                                                   
|Item 1.                        |  | Legal Proceedings                                                                                                  |  | 38  
|                               |  |                                                                                                                   
|Item 1.A.                      |  | Risk Factors                                                                                                       |  | 39  
|                               |  |                                                                                                                   
|Item 2.                        |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                        |  | 39  
|                               |  |                                                                                                                   
|Item 3.                        |  | Defaults Upon Senior Securities                                                                                    |  | 39  
|                               |  |                                                                                                                   
|Item 4.                        |  | Submission of Matters to a Vote of Security Holders                                                                |  | 39  
|                               |  |                                                                                                                   
|Item 5.                        |  | Other Information                                                                                                  |  | 39  
|                               |  |                                                                                                                   
|Item 6.                        |  | Exhibits:                                                                                                          |  | 39  



---

PART I  FINANCIAL INFORMATION



|Item 1. | Financial Statements
|------- | --------------------

[REMAINDER OF PAGE
INTENTIONALLY LEFT BLANK;

FINANCIAL STATEMENTS TO FOLLOW]



3



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DIVERSIFIED FUTURES TRUST I

FINANCIAL STATEMENTS

March 31, 2008



4



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DIVERSIFIED FUTURES TRUST I

CONDENSED STATEMENTS OF FINANCIAL CONDITION

March 31, 2008 (Unaudited) and December 31, 2007







|                                                                                                                          |  |               |            |                  |   |           
|------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ---------- | ---------------- | - | ----------
|                                                                                                                          |  | March 31,2008 |            | December 31,2007
|ASSETS                                                                                                                    |  |               |            |                  |   |           
|Cash                                                                                                                      |  | $             | 6,232      |                  | $ | 5,805     
|Redemptions receivable from WCM Pool LLC                                                                                  |  |               | 137,083    |                  |   | 304,479   
|Accounts receivable                                                                                                       |  |               | 140        |                  |   | 0         
|Investment in WCM Pool LLC, at net asset value (100.19% and 100.53% of net asset value, respectively)                     |  |               | 11,813,736 |                  |   | 11,055,308
|Receivable from Managing Owner                                                                                            |  |               | 11,370     |                  |   | 0         
|                                                                                                                          |  |               |            |                  |   |           
|Total assets                                                                                                              |  | $             | 11,968,561 |                  | $ | 11,365,592
|                                                                                                                          |  |               |            |                  |   |           
|LIABILITIES                                                                                                               |  |               |            |                  |   |           
|Redemptions payable                                                                                                       |  | $             | 139,266    |                  | $ | 302,152   
|Commissions payable                                                                                                       |  |               | 37,454     |                  |   | 66,250    
|                                                                                                                          |  |               |            |                  |   |           
|Total liabilities                                                                                                         |  |               | 176,720    |                  |   | 368,402   
|                                                                                                                          |  |               |            |                  |   |           
|TRUST CAPITAL (NET ASSET VALUE)                                                                                           |  |               |            |                  |   |           
|Limited Interests (45,658.287 and 46,189.067 interests outstanding) at March 31, 2008 and December 31, 2007,
respectively |  |               | 11,671,947 |                  |   | 10,883,382
|General Interests (469 and 483 interests outstanding) at March 31, 2008 and December 31, 2007, respectively               |  |               | 119,894    |                  |   | 113,808   
|                                                                                                                          |  |               |            |                  |   |           
|Total trust capital (Net Asset Value)                                                                                     |  |               | 11,791,841 |                  |   | 10,997,190
|                                                                                                                          |  |               |            |                  |   |           
|Total liabilities and trust capital                                                                                       |  | $             | 11,968,561 |                  | $ | 11,365,592
|                                                                                                                          |  |               |            |                  |   |           

Net Asset Value per Limited and General Interest



|              |        |                  |   |       
|------------- | ------ | ---------------- | - | ------
|March 31,2008 |        | December 31,2007
|$             | 255.64 |                  | $ | 235.63
|              |        |                  |   |       

See accompanying notes.



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DIVERSIFIED FUTURES TRUST I

CONDENSED STATEMENTS OF OPERATIONS

For the Three Months Ended March 31, 2008 and 2007

(Unaudited)







|                                                                     |  |                             |           |   |      |   |            |  
|-------------------------------------------------------------------- |  | --------------------------- | --------- | - | ---- | - | ---------- | -
|                                                                     |  | Three Months EndedMarch 31, |          
|                                                                     |  | 2008                        |           |   | 2007 |  
|NET LOSS FROM TRUST OPERATIONS                                       |  |                             |           |   |      |   |            |  
|REVENUES                                                             |  |                             |           |   |      |   |            |  
|Realized                                                             |  | $                           | 0         |   |      | $ | 52,475     |  
|Change in unrealized                                                 |  |                             | 0         |   |      |   | (71,943    | )
|Interest income                                                      |  |                             | 32        |   |      |   | 22,776     |  
|                                                                     |  |                             |           |   |      |   |            |  
|Total revenues                                                       |  |                             | 32        |   |      |   | 3,308      |  
|                                                                     |  |                             |           |   |      |   |            |  
|EXPENSES                                                             |  |                             |           |   |      |   |            |  
|Brokerage commissions and other transaction fees                     |  |                             | 216,301   |   |      |   | 225,801    |  
|                                                                     |  |                             |           |   |      |   |            |  
|Total expenses                                                       |  |                             | 216,301   |   |      |   | 225,801    |  
|                                                                     |  |                             |           |   |      |   |            |  
|Expenses borne by the Managing Owner and its affiliates              |  |                             | 8,114     |   |      |   | 0          |  
|                                                                     |  |                             |           |   |      |   |            |  
|Net expenses                                                         |  |                             | 208,187   |   |      |   | 225,801    |  
|                                                                     |  |                             |           |   |      |   |            |  
|NET LOSS FROM TRUST OPERATIONS                                       |  |                             | (208,155  | ) |      |   | (222,493   | )
|                                                                     |  |                             |           |   |      |   |            |  
|NET INCOME (LOSS) ALLOCATED FROM WCM POOL LLC:                       |  |                             |           |   |      |   |            |  
|REVENUES                                                             |  |                             |           |   |      |   |            |  
|Realized                                                             |  |                             | 1,740,383 |   |      |   | (1,297,006 | )
|Change in unrealized                                                 |  |                             | (289,048  | ) |      |   | 228,858    |  
|Interest income                                                      |  |                             | 52,248    |   |      |   | 123,544    |  
|                                                                     |  |                             |           |   |      |   |            |  
|Total revenues                                                       |  |                             | 1,503,583 |   |      |   | (944,604   | )
|                                                                     |  |                             |           |   |      |   |            |  
|EXPENSES                                                             |  |                             |           |   |      |   |            |  
|Brokerage commissions and other transaction fees                     |  |                             | 6,104     |   |      |   | 23,680     |  
|Management fees                                                      |  |                             | 60,173    |   |      |   | 61,648     |  
|Incentive fees                                                       |  |                             | 272,455   |   |      |   | 0          |  
|General and administrative                                           |  |                             | 22,780    |   |      |   | 5,488      |  
|                                                                     |  |                             |           |   |      |   |            |  
|Total expenses                                                       |  |                             | 361,512   |   |      |   | 90,816     |  
|                                                                     |  |                             |           |   |      |   |            |  
|NET INCOME (LOSS) ALLOCATED FROM WCM POOL LLC                        |  |                             | 1,142,071 |   |      |   | (1,035,420 | )
|                                                                     |  |                             |           |   |      |   |            |  
|NET INCOME (LOSS)                                                    |  | $                           | 933,916   |   |      | $ | (1,257,913 | )
|                                                                     |  |                             |           |   |      |   |            |  
|NET INCOME (LOSS) PER WEIGHTED AVERAGE LIMITED AND GENERAL INTEREST  |  |                             |           |   |      |   |            |  
|Net income (loss) per weighted average Limited and General Interest  |  | $                           | 20.07     |   |      | $ | (21.87     | )
|                                                                     |  |                             |           |   |      |   |            |  
|Weighted average number of Limited and General Interests outstanding |  |                             | 46,536    |   |      |   | 57,514     |  
|                                                                     |  |                             |           |   |      |   |            |  

See accompanying notes.



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DIVERSIFIED FUTURES TRUST I

CONDENSED STATEMENTS OF CHANGES IN TRUST CAPITAL

For the Three Months Ended March 31, 2008 and 2007

(Unaudited)







|                                                     |  |            |   |  |                  |            |   |                  |   |         |       |  |   |            |  
|---------------------------------------------------- |  | ---------- | - |  | ---------------- | ---------- | - | ---------------- | - | ------- | ----- |  | - | ---------- | -
|                                                     |  | Interests  |   |  | LimitedInterests |            |   | GeneralInterests |   |         | Total | 
|Three months ended March 31, 2008                    |  |            |   |  |                  |            |   |                  |   |         |       |  |   |            |  
|Trust capital at December 31, 2007                   |  | 46,672.067 |   |  | $                | 10,883,382 |   |                  | $ | 113,808 |       |  | $ | 10,997,190 |  
|Redemptions                                          |  | (544.780   | ) |  |                  | (135,686   | ) |                  |   | (3,579  | )     |  |   | (139,265   | )
|Net income for the three months ended March 31, 2008 |  | 0.000      |   |  |                  | 924,251    |   |                  |   | 9,665   |       |  |   | 933,916    |  
|                                                     |  |            |   |  |                  |            |   |                  |   |         |       |  |   |            |  
|Trust capital at March 31, 2008                      |  | 46,127.287 |   |  | $                | 11,671,947 |   |                  | $ | 119,894 |       |  | $ | 11,791,841 |  
|                                                     |  |            |   |  |                  |            |   |                  |   |         |       |  |   |            |  
|Three months ended March 31, 2007                    |  |            |   |  |                  |            |   |                  |   |         |       |  |   |            |  
|Trust capital at December 31, 2006                   |  | 58,278.560 |   |  | $                | 12,835,254 |   |                  | $ | 143,870 |       |  | $ | 12,979,124 |  
|Redemptions                                          |  | (3,057.136 | ) |  |                  | (603,601   | ) |                  |   | (11,263 | )     |  |   | (614,864   | )
|Net loss for the three months ended March 31, 2007   |  | 0.000      |   |  |                  | (1,243,969 | ) |                  |   | (13,944 | )     |  |   | (1,257,913 | )
|                                                     |  |            |   |  |                  |            |   |                  |   |         |       |  |   |            |  
|Trust capital at March 31, 2007                      |  | 55,221.424 |   |  | $                | 10,987,684 |   |                  | $ | 118,663 |       |  | $ | 11,106,347 |  
|                                                     |  |            |   |  |                  |            |   |                  |   |         |       |  |   |            |  

See accompanying notes.



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DIVERSIFIED FUTURES TRUST I

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)





Note 1. ORGANIZATION



| | A. | General Description of the Trust
| | -- | --------------------------------

Diversified Futures
Trust I (the Trust) was organized under the Delaware Statutory Trust Act on May 18, 1994 and will continue until December 31, 2020 unless terminated sooner under the provisions of the Second Amended and Restated
Declaration of Trust and Trust Agreement (the Trust Agreement). The Trust was formed to engage in the speculative trading of commodity futures and forward contracts. The Trusts trustee is Wilmington Trust Company.

Effective January 1, 2007, Preferred Investment Solutions Corp., the Managing Owner (Preferred or Managing
Owner), terminated the Trading Advisor Agreements with Aspect Capital Limited and Graham Capital Management, L.P., and the Trust contributed its net assets to WCM Pool LLC (the Company) and received a Voting Membership
Interest in the Company. The Company was formed to function as an aggregate trading vehicle. The sole members of the Company are the Trust, Diversified Futures Fund L.P. (DFF), Futures Strategic Trust (FST) and
Kenmar Global Trust (KGT). Preferred is the General Partner or Managing Owner of DFF, FST and KGT and has been delegated administrative authority over the operations of the Company. The Company engages in the speculative trading
of futures and forward contracts. The financial statements of the Company, including the condensed schedule of investments, are included in Section II of these financial statements and should be read in conjunction with the Trusts financial
statements.



| | B. | Regulation
| | -- | ----------

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



| | C. | The Offering
| | -- | ------------

On January 5, 1995, the Trust completed
its initial offering from the sale of limited interests (Limited Interests) and general interests (General Interests) (collectively, the Interests). Additional Interests were offered and sold
monthly at the then current net asset value (NAV) per Interest until the continuous offering period expired on August 31, 1996. General Interests were sold exclusively to the Managing Owner.

The Managing Owner is required to maintain at least a 1% interest in the Trust so long as it is acting as the Managing Owner.



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DIVERSIFIED FUTURES TRUST I

NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)





Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



| | A. | Basis of Accounting
| | -- | -------------------

The statement of financial condition
as of March 31, 2008, and the statements of operations and changes in trust capital for the three months ended March 31, 2008 and 2007 are unaudited. In the opinion of Preferred, the financial statements contain all adjustments (consisting
of only normal recurring adjustments) necessary to state fairly the financial position of the Trust as of March 31, 2008 and the results of its operations for the three months ended March 31, 2008 and 2007. The operating results for the
interim periods may not be indicative of the results expected for the full year.

Certain information and footnote disclosures normally
included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted. It is suggested that these financial statements be read in conjunction with the financial
statements and notes thereto included in the Trusts annual report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2007.

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

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

For the three months ended March 31, 2008 and 2007, the Trust indirectly earned income or loss through its investments in the Company (see Note 2).

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

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



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DIVERSIFIED FUTURES TRUST I

NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)





Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)



| | A. | Basis of Accounting (Continued)
| | -- | -------------------------------



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

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

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

The Trust adopted SFAS 157 in the first quarter of 2008. Preferred, as Managing Owner of the Trust, evaluated
the impact adoption of SFAS 157 will have on the Trusts financial statements. Based on an analysis by Preferred, the effect of applying SFAS 157 to the investments included in these financial statements will not result in a change to the fair
value of the Trusts investments. Approximately $0 or 0.00% of the Trusts investment at March 31, 2008 is classified as Level 1 or Level 2 and $11,813,736 or 100.00% is classified as Level 3 using the fair value hierarchy of SFAS
157. Approximately $0 or 0.00% of the Trusts investments at December 31, 2007 is classified as Level 1 or Level 2 and $11,055,308 or 100.00% is classified as Level 3 using the fair value hierarchy of SFAS 157. A table presenting the
changes in the Level 3 fair value category for the three months ended March 31, 2008 is provided in Note 5 of these financial statements. Of the $1,142,071 gain for the three months ended March 31, 2008 reported on Level 3 investments in Note 5,
$(289,048) represents a change in unrealized allocated from the Company on the Trusts condensed statement of operations.

In February
2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of SFAS 115, or SFAS 159. This statement provides companies with an option to report selected financial
assets and liabilities at fair value. This statement is effective for fiscal years beginning after November 15, 2007 with early adoption permitted.



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DIVERSIFIED FUTURES TRUST I

NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)





Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)



| | A. | Basis of Accounting (Continued)
| | -- | -------------------------------



Preferred, as Managing Owner of the Trust, evaluated the impact adoption of SFAS 159 will have on the
Trusts financial statements. The Trust adopted SFAS 159 in the first quarter of 2008, and it did not have a material effect on the Trust financial statements.

Cash represents amounts deposited with a bank and clearing broker, a portion of which is restricted for purposes of meeting margin requirements, which typically range from 0% to 35% of the notional amounts of the
derivatives traded. The Trust receives interest at prevailing rates on all cash balances held by the bank and clearing broker, as well as its pro rata share of interest income from the Company.



| | B. | Income Taxes
| | -- | ------------

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



| | C. | Investment in WCM Pool LLC
| | -- | --------------------------

The investment in the Company
is reported in the Trusts statements of financial condition at the net asset value as reported by the Company. The Trust records its proportionate share of the Companys income or loss in the statement of operations. Through its
investment in the Company, the Trust pays its pro-rata share of the 2% annual management fee (accrued and paid monthly) and a 20% incentive fee on New High Net Trading Profits (accrued monthly and paid quarterly) as defined in the advisory
agreement. Valuation of futures and forward contracts by the Company is discussed in the notes to the Companys financial statements included in Section II of this report.



| | D. | Profit and Loss Allocation, Distributions and Redemptions
| | -- | ---------------------------------------------------------

Net income or loss for both financial and tax reporting purposes is allocated monthly to all interest holders on a pro rata basis on each interest holders number of interests outstanding during the month.

Distributions (other than redemptions of interests) are made at the sole discretion of the Managing Owner on a pro rata basis in accordance with the
respective capital accounts of the interest holders. The Managing Owner has not made and does not intend to make any distributions.

The
Trust Agreement provides that an Interest holder may redeem its Interests as of the last business day of any calendar quarter at the then current NAV per interest.



| | E. | Foreign Currency Transaction
| | -- | ----------------------------

The Trusts functional
currency is the U.S. dollar; however, it transacts business in currencies other than the U.S. dollar. Assets and liabilities denominated in currencies other than the U.S. dollar are translated into U.S. dollars at the rates in effect at the date of
the statement of financial condition. Income and expense items denominated in currencies other than U.S. dollars are translated into U.S. dollars at the rates in effect during the period.



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11



---

DIVERSIFIED FUTURES TRUST I

NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)





Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)



| | E. | Foreign Currency Transaction (Continued)
| | -- | ----------------------------------------



Gains and losses resulting from the translation to U.S. dollars are reported in operations currently
under the caption Realized in the statements of operations.



| | F. | Interest Income
| | -- | ---------------

Interest income is recorded on an accrual
basis.

Note 3. FEES



| | A. | Organizational and General and Administrative Costs
| | -- | ---------------------------------------------------

Preferred pays all administrative costs for services it performs for the Trust. Administrative costs include, but are not limited to, those discussed in Note 4 below. The Trust pays for its pro-rata allocation of expenses incurred by the
Company except for the Spectrum Global Fund Administration administrative fee.



| | B. | Management and Incentive Fees
| | -- | -----------------------------

The Trust pays its pro-rata
share of management and incentive fees as disclosed in Note 2(c) through its investment in the Company.



| | C. | Commissions
| | -- | -----------

The Trust deducts the cost of its pro-rata
share of commissions allocated from the Company in calculation of the Managing Owners 7.75% per annum commission.

Note 4. RELATED
PARTIES

The Managing Owner or third parties engaged by the Managing Owner perform services for the Trust which include, but are not
limited to: brokerage services; accounting and financial management; registrar, transfer and assignment function; investor communications; printing and other administrative services. Except for costs related to brokerage services, Preferred pays all
the costs of these services as well as the Trusts routine operational, administrative, legal and auditing costs.

The costs charged to
the Trust for brokerage services for the three months ended March 31, 2008 and 2007 were $222,405 and $249,481, respectively.



-9-



12



---

DIVERSIFIED FUTURES TRUST I

NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)







Note 5. INVESTMENT IN WCM POOL LLC

Effective January 1, 2007, the Trust invested its assets in the Company. The Trusts investment in the Company represents approximately 55.71%
and 54.86% of the net asset value of the Company at March 31, 2008 and December 31, 2007, respectively. The investment in the Company is subject to the Organization Agreement of the Company.

Summarized information for the Trusts investment in the Company is as follows:



|             |  |                                  |            |             |   |            |  |   |             |   |  |                               |          |   |  |   |           
|------------ |  | -------------------------------- | ---------- | ----------- | - | ---------- |  | - | ----------- | - |  | ----------------------------- | -------- | - |  | - | ----------
|             |  | Net Asset ValueDecember 31, 2007 |            | Investments |   | Gain       |  |   | Redemptions |   |  | Net Asset ValueMarch 31, 2008
|WCM Pool LLC |  | $                                | 11,055,308 |             | $ | 0          |  | $ | 1,142,071   |   |  | $                             | (383,643 | ) |  | $ | 11,813,736
|             |  |                                  |            |             |   |            |  |   |             |   |  |                               |          |   |  |   |           
|             |  |                                  |            |             |  
|             |  | Net Asset ValueDecember 31, 2006 |            | Investments |   | Loss       |  |   | Redemptions |   |  | Net Asset ValueMarch 31, 2007
|WCM Pool LLC |  | $                                | 0          |             | $ | 12,966,087 |  | $ | (1,035,420  | ) |  | $                             | (167,589 | ) |  | $ | 11,763,078
|             |  |                                  |            |             |   |            |  |   |             |   |  |                               |          |   |  |   |           

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

Note 6. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS

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

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

The Trusts futures commission merchant in accepting orders for the purchase or sale of domestic futures contracts, is required by CFTC regulations
to separately account for and segregate as belonging to the Trust all assets of the Trust relating to domestic futures trading and is not to commingle such assets with its other assets. At March 31, 2008 and December 31, 2007, such
segregated assets totaled $0 and $1,042, respectively. Part 30.7 of the CFTC regulations also requires the Trusts futures commission merchant to secure assets of the Trust related to foreign futures trading which totaled $0 and $0 at
March 31, 2008 and December 31, 2007, respectively. There are no segregation requirements for assets related to forward trading.



-10-



13



---

DIVERSIFIED FUTURES TRUST I

NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)







Note 7. FINANCIAL HIGHLIGHTS

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



|                                                                                       |  |                             |        |    |      |   |        |   
|-------------------------------------------------------------------------------------- |  | --------------------------- | ------ | -- | ---- | - | ------ | --
|                                                                                       |  | Three Months EndedMarch 31, |       
|                                                                                       |  | 2008                        |        |    | 2007 |  
|Per Interest Performance                                                               |  |                             |        |    |      |   |        |   
|(for an Interest outstanding throughout the entire period)                             |  |                             |        |    |      |   |        |   
|Net asset value, beginning of period                                                   |  | $                           | 235.63 |    |      | $ | 222.71 |   
|                                                                                       |  |                             |        |    |      |   |        |   
|Net realized and change in net unrealized gain (loss) on commodity transactions(1),(5) |  |                             | 31.13  |    |      |   | (18.62 | ) 
|Interest income(1),(5)                                                                 |  |                             | 1.12   |    |      |   | 2.54   |   
|Expenses(1),(5)                                                                        |  |                             | (12.24 | )  |      |   | (5.51  | ) 
|                                                                                       |  |                             |        |    |      |   |        |   
|Net increase (decrease) for the period                                                 |  |                             | 20.01  |    |      |   | (21.59 | ) 
|                                                                                       |  |                             |        |    |      |   |        |   
|Net asset value, end of period                                                         |  | $                           | 255.64 |    |      | $ | 201.12 |   
|                                                                                       |  |                             |        |    |      |   |        |   
|Total Return(3)                                                                        |  |                             |        |    |      |   |        |   
|Total return before incentive fees                                                     |  |                             | 10.84  | %  |      |   | (9.69  | )%
|Incentive fees                                                                         |  |                             | (2.35  | )% |      |   | 0.00   | % 
|                                                                                       |  |                             |        |    |      |   |        |   
|Total return after incentive fees                                                      |  |                             | 8.49   | %  |      |   | (9.69  | )%
|                                                                                       |  |                             |        |    |      |   |        |   
|Supplemental Data                                                                      |  |                             |        |    |      |   |        |   
|Ratios to average net asset value:(5)                                                  |  |                             |        |    |      |   |        |   
|Net investment loss before incentive fees(2),(4)                                       |  |                             | (8.47  | )% |      |   | (5.48  | )%
|Incentive fees(3)                                                                      |  |                             | (2.35  | )% |      |   | 0.00   | % 
|                                                                                       |  |                             |        |    |      |   |        |   
|Net investment loss after incentive fees                                               |  |                             | (10.82 | )% |      |   | (5.48  | )%
|                                                                                       |  |                             |        |    |      |   |        |   
|Interest income(4)                                                                     |  |                             | 1.81   | %  |      |   | 4.71   | % 
|                                                                                       |  |                             |        |    |      |   |        |   
|Incentive fees(3)                                                                      |  |                             | 2.35   | %  |      |   | 0.00   | % 
|Other expenses(4)                                                                      |  |                             | 10.28  | %  |      |   | 10.19  | % 
|                                                                                       |  |                             |        |    |      |   |        |   
|Total net expenses                                                                     |  |                             | 12.63  | %  |      |   | 10.19  | % 
|                                                                                       |  |                             |        |    |      |   |        |   

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



|(1) | Interest income per Interest and expenses per Interest are calculated by dividing interest income and expenses by the
weighted average number of Interests outstanding during the period. Net realized and change in net unrealized gain (loss) on commodity transactions is a balancing amount necessary to reconcile the change in net asset value per Interest with the
other per Interest information.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | Represents interest income less total expenses (exclusive of incentive fees).
|--- | -----------------------------------------------------------------------------



|(3) | Not annualized.
|--- | ---------------



|(4) | Annualized.
|--- | -----------



|(5) | Includes the Trusts proportionate share of income and expenses of WCM Pool LLC for the three months ended
March 31, 2008 and 2007.
|--- | -----------------------------------------------------------------------------------------------------------------------------------



-11-



14



---



SECTION II







15



---

WCM POOL LLC

FINANCIAL STATEMENTS

March 31, 2008



16



---

WCM POOL LLC

CONDENSED STATEMENTS OF FINANCIAL CONDITION

March 31, 2008 (Unaudited) and December 31, 2007







|                                        |  |               |            |                  |   |           
|--------------------------------------- |  | ------------- | ---------- | ---------------- | - | ----------
|                                        |  | March 31,2008 |            | December 31,2007
|ASSETS                                  |  |               |            |                  |   |           
|Cash                                    |  | $             | 22,104,507 |                  | $ | 20,525,950
|Interest receivable                     |  |               | 18,149     |                  |   | 47,642    
|Accounts receivable                     |  |               | 1,600      |                  |   | 0         
|Net unrealized gain on open contracts   |  |               | 0          |                  |   | 434,983   
|                                        |  |               |            |                  |   |           
|Total assets                            |  | $             | 22,124,256 |                  | $ | 21,008,575
|                                        |  |               |            |                  |   |           
|LIABILITIES                             |  |               |            |                  |   |           
|Net unrealized loss on open contracts   |  | $             | 71,359     |                  | $ | 0         
|Accrued expenses                        |  |               | 53,728     |                  |   | 33,955    
|Management fees payable                 |  |               | 35,880     |                  |   | 70,084    
|Incentive fees payable                  |  |               | 493,010    |                  |   | 174,235   
|Redemptions payable                     |  |               | 266,062    |                  |   | 580,258   
|                                        |  |               |            |                  |   |           
|Total liabilities                       |  |               | 920,039    |                  |   | 858,532   
|                                        |  |               |            |                  |   |           
|MEMBERS CAPITAL (Net Asset Value)      |  |               |            |                  |   |           
|Member DFF LP                           |  |               | 3,335,747  |                  |   | 3,165,178 
|Member DFT I                            |  |               | 11,813,736 |                  |   | 11,055,308
|Member KGT                              |  |               | 1,570,210  |                  |   | 1,732,978 
|Member FST                              |  |               | 4,484,524  |                  |   | 4,196,579 
|                                        |  |               |            |                  |   |           
|Total members capital(Net Asset Value) |  |               | 21,204,217 |                  |   | 20,150,043
|                                        |  |               |            |                  |   |           
|Total liabilities and members capital  |  | $             | 22,124,256 |                  | $ | 21,008,575
|                                        |  |               |            |                  |   |           

See accompanying notes.



-2-



17



---

WCM POOL LLC

CONDENSED SCHEDULES OF INVESTMENTS

March 31, 2008 (Unaudited) and December 31, 2007







|                                                          |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  
|--------------------------------------------------------- |  | ------------------------------------------------- | -- |  | ------------------------ | -------- | - | ------------------------------------------------- | ----- | -- | ------------------------ | - | ------- | -
|                                                          |  | March 31, 2008                                    |    |  | December 31, 2007        |         
|Open Futures Contracts                                    |  | NetUnrealizedGain (Loss)as a % ofMembers Capital |    |  | NetUnrealizedGain (Loss) |          |   | NetUnrealizedGain (Loss)as a % ofMembers Capital |       |    | NetUnrealizedGain (Loss) |  
|Futures contracts purchased:                              |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  
|Commodities                                               |  | (1.43                                             | )% |  | $                        | (303,535 | ) |                                                   | 1.82  | %  |                          | $ | 367,154 |  
|Currencies                                                |  | 0.69                                              | %  |  |                          | 146,528  |   |                                                   | (0.24 | )% |                          |   | (49,036 | )
|Interest rates                                            |  | 0.35                                              | %  |  |                          | 73,972   |   |                                                   | 0.57  | %  |                          |   | 115,021 |  
|Stock indicies                                            |  | 0.00                                              | %  |  |                          | 0        |   |                                                   | 0.09  | %  |                          |   | 17,163  |  
|                                                          |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  
|Net unrealized gain (loss) on futures contracts purchased |  | (0.39                                             | )% |  |                          | (83,035  | ) |                                                   | 2.24  | %  |                          |   | 450,302 |  
|                                                          |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  
|Futures contracts sold:                                   |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  
|Commodities                                               |  | 0.01                                              | %  |  |                          | 2,811    |   |                                                   | (0.01 | )% |                          |   | (1,873  | )
|Currencies                                                |  | 0.06                                              | %  |  |                          | 13,580   |   |                                                   | (0.05 | )% |                          |   | (9,014  | )
|Interest rates                                            |  | 0.03                                              | %  |  |                          | 6,806    |   |                                                   | (0.04 | )% |                          |   | (8,288  | )
|Stock indicies                                            |  | (0.05                                             | )% |  |                          | (11,521  | ) |                                                   | 0.02  | %  |                          |   | 3,856   |  
|                                                          |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  
|Net unrealized gain (loss) on futures contracts sold      |  | 0.05                                              | %  |  |                          | 11,676   |   |                                                   | (0.08 | )% |                          |   | (15,319 | )
|                                                          |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  
|Net unrealized gain (loss) on open contracts              |  | (0.34                                             | )% |  | $                        | (71,359  | ) |                                                   | 2.16  | %  |                          | $ | 434,983 |  
|                                                          |  |                                                   |    |  |                          |          |   |                                                   |       |    |                          |   |         |  

See accompanying notes.



-3-



18



---

WCM POOL LLC

CONDENSED STATEMENTS OF OPERATIONS

For the Three Months Ended March 31, 2008 and 2007

(Unaudited)







|                      |  |                             |           |   |      |   |            |  
|--------------------- |  | --------------------------- | --------- | - | ---- | - | ---------- | -
|                      |  | Three Months EndedMarch 31, |          
|                      |  | 2008                        |           |   | 2007 |  
|REVENUES              |  |                             |           |   |      |   |            |  
|Realized              |  | $                           | 3,132,167 |   |      | $ | (1,868,661 | )
|Change in unrealized  |  |                             | (506,342  | ) |      |   | 333,251    |  
|Interest income       |  |                             | 94,556    |   |      |   | 177,426    |  
|                      |  |                             |           |   |      |   |            |  
|Total revenues        |  |                             | 2,720,381 |   |      |   | (1,357,984 | )
|                      |  |                             |           |   |      |   |            |  
|EXPENSES              |  |                             |           |   |      |   |            |  
|Brokerage commissions |  |                             | 11,015    |   |      |   | 33,982     |  
|Management fee        |  |                             | 108,631   |   |      |   | 88,511     |  
|Incentive fee         |  |                             | 493,010   |   |      |   | 0          |  
|Operating expenses    |  |                             | 41,131    |   |      |   | 7,880      |  
|                      |  |                             |           |   |      |   |            |  
|Total expenses        |  |                             | 653,787   |   |      |   | 130,373    |  
|                      |  |                             |           |   |      |   |            |  
|NET INCOME (LOSS)     |  | $                           | 2,066,594 |   |      | $ | (1,488,357 | )
|                      |  |                             |           |   |      |   |            |  

See accompanying notes.



-4-



19



---

WCM POOL LLC

CONDENSED STATEMENTS OF CHANGES IN MEMBERS CAPITAL (NET ASSET VALUE)

For the Three Months Ended March 31, 2008 and 2007

(Unaudited)









|                                                     |  |                  |           |   |             |   |            |           |  |   |           |   |  |       |           |   |  |   |            |  
|---------------------------------------------------- |  | ---------------- | --------- | - | ----------- | - | ---------- | --------- |  | - | --------- | - |  | ----- | --------- | - |  | - | ---------- | -
|                                                     |  | Members Capital |          
|                                                     |  | MemberDFF LP     |           |   | MemberDFT I |   |            | MemberKGT |  |   | MemberFST |   |  | Total |          
|Three months ended March 31, 2008                    |  |                  |           |   |             |   |            |           |  |   |           |   |  |       |           |   |  |   |            |  
|Balances at December 31, 2007                        |  | $                | 3,165,178 |   |             | $ | 11,055,308 |           |  | $ | 1,732,978 |   |  | $     | 4,196,579 |   |  | $ | 20,150,043 |  
|Redemptions                                          |  |                  | (156,170  | ) |             |   | (383,643   | )         |  |   | (329,526  | ) |  |       | (143,081  | ) |  |   | (1,012,420 | )
|Net income for the three months ended March 31, 2008 |  |                  | 326,739   |   |             |   | 1,142,071  |           |  |   | 166,758   |   |  |       | 431,026   |   |  |   | 2,066,594  |  
|                                                     |  |                  |           |   |             |   |            |           |  |   |           |   |  |       |           |   |  |   |            |  
|Balances at March 31, 2008                           |  | $                | 3,335,747 |   |             | $ | 11,813,736 |           |  | $ | 1,570,210 |   |  | $     | 4,484,524 |   |  | $ | 21,204,217 |  
|                                                     |  |                  |           |   |             |   |            |           |  |   |           |   |  |       |           |   |  |   |            |  



|                                                   |  |                  |           |   |             |   |            |           |  |   |           |   |  |   |            |  
|-------------------------------------------------- |  | ---------------- | --------- | - | ----------- | - | ---------- | --------- |  | - | --------- | - |  | - | ---------- | -
|                                                   |  | Members Capital |          
|                                                   |  | MemberDFF LP     |           |   | MemberDFT I |   |            | MemberKGT |  |   | Total     |  
|Three months ended March 31, 2007                  |  |                  |           |   |             |   |            |           |  |   |           |   |  |   |            |  
|Balances at December 31, 2006                      |  | $                | 0         |   |             | $ | 0          |           |  | $ | 0         |   |  | $ | 0          |  
|Additions                                          |  |                  | 3,617,593 |   |             |   | 12,966,087 |           |  |   | 2,100,000 |   |  |   | 18,683,680 |  
|Redemptions                                        |  |                  | (44,424   | ) |             |   | (167,589   | )         |  |   | (24,445   | ) |  |   | (236,458   | )
|Net loss for the three months ended March 31, 2007 |  |                  | (288,754  | ) |             |   | (1,035,420 | )         |  |   | (164,183  | ) |  |   | (1,488,357 | )
|                                                   |  |                  |           |   |             |   |            |           |  |   |           |   |  |   |            |  
|Balances at March 31, 2007                         |  | $                | 3,284,415 |   |             | $ | 11,763,078 |           |  | $ | 1,911,372 |   |  | $ | 16,958,865 |  
|                                                   |  |                  |           |   |             |   |            |           |  |   |           |   |  |   |            |  

See accompanying notes.



-5-



20



---

WCM POOL LLC

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)







|Note | 1. ORGANIZATION
|---- | ---------------



| | A. | General Description of the Company
| | -- | ----------------------------------

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

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



| | B. | The Trading Advisor
| | -- | -------------------

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



|Note | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|---- | ---------------------------------------------



| | A. | Basis of Accounting
| | -- | -------------------

The statement of financial condition,
including the condensed schedule of investments, as of March 31, 2008, and the statements of operations and changes in members capital (net asset value) for the three months ended March 31, 2008 and 2007 are unaudited. In the opinion
of Preferred, such financial statements reflect all adjustments, which were of a normal and recurring nature, necessary for a fair presentation of financial position as of March 31, 2008, and the results of operations for the three months ended
March 31, 2008 and 2007. The operating results for these interim periods may not be indicative of the results expected for a full year.

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



-6-



21



---

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)





Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)



| | A. | Basis of Accounting (Continued)
| | -- | -------------------------------



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

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

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

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



-7-



22



---

WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)





Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)



| | A. | Basis of Accounting (Continued)
| | -- | -------------------------------



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

The Company adopted SFAS 157 in the first quarter of 2008. Preferred,
as Managing Member of the Company, evaluated the impact adoption of SFAS 157 will have on the Companys financial statements. Based on an analysis by Preferred, the effect of applying SFAS 157 to the investment portfolio included in these
financial statements will not result in a change to the fair value of the Companys investments. Of its net unrealized loss, approximately $(71,359) or 100.00% of the Companys investments at March 31, 2008 is classified as Level 1
and $0 or 0.00% as Level 2 or Level 3 using the fair value hierarchy of SFAS 157. Of its net unrealized gain, approximately $434,983 or 100.00% of the Companys investments at December 31, 2007 is classified as Level 1 and $0 or 0.00% as
Level 2 or Level 3 using the fair value hierarchy of SFAS 157.

In February 2007, the FASB issued SFAS No. 159, The Fair Value
Option for Financial Assets and Financial Liabilities, including an amendment of SFAS 115, or SFAS 159. This statement provides companies with an option to report selected financial assets and liabilities at fair value. This statement is
effective for fiscal years beginning after November 15, 2007 with early adoption permitted.

Preferred, as Managing Member of the
Company, evaluated the impact adoption of SFAS 159 will have on the Companys financial statements. The Company adopted SFAS 159 in the first quarter of 2008, and it did not have a material effect on the Companys financial statements.

Cash represents amounts deposited with a bank and clearing broker, a portion of which is restricted for purposes of meeting margin
requirements, which typically range from 0% to 35% of the notional amounts of the derivatives traded. The Company receives interest at prevailing interest rates on all cash balances held by the clearing broker and bank.



| | B. | Income Taxes
| | -- | ------------

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



| | C. | Capital Accounts
| | -- | ----------------

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



-8-



23



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WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)





Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)



| | C. | Capital Accounts (Continued)
| | -- | ----------------------------



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



| | D. | Foreign Currency Transactions
| | -- | -----------------------------

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



| | E. | Interest Income
| | -- | ---------------

Interest income is recorded on an accrual
basis.



|Note | 3. FEES
|---- | -------



| | A. | Operating Expenses
| | -- | ------------------

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



| | B. | Management and Incentive Fees
| | -- | -----------------------------

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

Additionally, the Company pays the Trading Advisor a quarterly incentive fee of 20% (the Incentive Fee) of New High Net Trading
Profits (as defined in the Advisory Agreement). For the three months ended March 31, 2008 and 2007, the Trading Advisor earned incentive fees of $493,010 and $0, respectively, of which $493,010 remains payable at March 31, 2008.



|Note | 4. INCOME TAXES
|---- | ---------------

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



-9-



24



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WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)







|Note | 5. DEPOSITS WITH COMMODITY BROKER
|---- | ---------------------------------

The Company
deposits funds with a commodity broker subject to CFTC regulations and various exchange and commodity broker requirements. Margin requirements are satisfied by the deposit of cash with such commodity broker. The Company earns interest income on
assets deposited with the commodity broker.



|Note | 6. SUBSCRIPTIONS, DISTRIBUTIONS AND REDEMPTIONS
|---- | -----------------------------------------------

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

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

Note 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS

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

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

Market Risk

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

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



-10-



25



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WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)







|Note | 7. DERIVATIVE INSTRUMENTS AND ASSOCIATED RISKS (CONTINUED)
|---- | ----------------------------------------------------------



Credit Risk

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

Preferred attempts to minimize both credit and market risks by requiring the Company and its Trading Advisor to abide by various trading limitations and policies. Preferred monitors compliance with these trading
limitations and policies, which include, but are not limited to, executing and clearing all trades with creditworthy counterparties; limiting the amount of margin or premium required for any one commodity or all commodities combined; and generally
limiting transactions to contracts which are traded in sufficient volume to permit the taking and liquidating of positions. Additionally, pursuant to the Advisory Agreement among the Company, Preferred and the Trading Advisor, the Company shall
automatically terminate the Trading Agreement, if the net asset value allocated to the Trading Advisor declines by 40% from the value at the beginning of any year or since the effective date of the Advisory Agreement. The decline in net asset value
is after giving effect for distributions, subscriptions and redemptions.

The Companys futures commission merchant, in accepting
orders for the purchase or sale of domestic futures contracts, is required by CFTC regulations to separately account for and segregate as belonging to the Company all assets of the Company relating to domestic futures trading and is not allowed to
commingle such assets with its other assets. At March 31, 2008 and December 31, 2007, such segregated assets totaled $18,121,067 and $17,941,562, respectively. Part 30.7 of the CFTC regulations also requires the Companys futures
commission merchant to secure assets of the Company related to foreign futures trading which totaled $(29,906) and $48,961 at March 31, 2008 and December 31, 2007, respectively. There are no segregation requirements for assets related to
forward trading.

As of March 31, 2008, all open futures contracts mature within twenty months.



-11-



26



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WCM POOL LLC

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

(Unaudited)







|Note | 8. FINANCIAL HIGHLIGHTS
|---- | -----------------------

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



|                                    |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   
|----------------------------------- |  | ------------------------------------------- | -- |  | ------------------------------------------- | -- |  | --------- | -- |  | --------- | -- |  | ------------ | -- |  | ----------- | -- |  | --------- | --
|                                    |  | Three Months EndedMarch 31, 2008(Unaudited) |    |  | Three Months EndedMarch 31, 2007(Unaudited) |   
|                                    |  | MemberDFF LP                                |    |  | MemberDFT I                                 |    |  | MemberKGT |    |  | MemberFST |    |  | MemberDFF LP |    |  | MemberDFT I |    |  | MemberKGT |   
|Total return:(1),(4)                |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   
|Total return before incentive fee   |  | 12.88                                       | %  |  | 12.87                                       | %  |  | 12.87     | %  |  | 12.87     | %  |  | (8.20        | )% |  | (8.20       | )% |  | (8.33     | )%
|Incentive fee                       |  | (2.52                                       | )% |  | (2.51                                       | )% |  | (2.51     | )% |  | (2.51     | )% |  | 0.00         | %  |  | 0.00        | %  |  | 0.00      | % 
|                                    |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   
|Total return after incentive fee    |  | 10.36                                       | %  |  | 10.36                                       | %  |  | 10.36     | %  |  | 10.36     | %  |  | (8.20        | )% |  | (8.20       | )% |  | (8.33     | )%
|                                    |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   
|Ratios to average net asset values: |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   
|Expenses prior to incentive fee(2)  |  | 3.08                                        | %  |  | 3.07                                        | %  |  | 3.12      | %  |  | 3.06      | %  |  | 2.88         | %  |  | 2.88        | %  |  | 2.89      | % 
|Incentive fee(1)                    |  | 2.36                                        | %  |  | 2.35                                        | %  |  | 2.45      | %  |  | 2.34      | %  |  | 0.00         | %  |  | 0.00        | %  |  | 0.00      | % 
|                                    |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   
|Total expenses and incentive fee    |  | 5.44                                        | %  |  | 5.42                                        | %  |  | 5.57      | %  |  | 5.40      | %  |  | 2.88         | %  |  | 2.88        | %  |  | 2.89      | % 
|                                    |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   
|Net investment income (loss)(2),(3) |  | (1.27                                       | )% |  | (1.27                                       | )% |  | (1.25     | )% |  | (1.26     | )% |  | 1.04         | %  |  | 1.04        | %  |  | 1.05      | % 
|                                    |  |                                             |    |  |                                             |    |  |           |    |  |           |    |  |              |    |  |             |    |  |           |   

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



|(1) | Not annualized.
|--- | ---------------



|(2) | Annualized.
|--- | -----------



|(3) | Represents interest income less total expenses (exclusive of incentive fee).
|--- | ----------------------------------------------------------------------------



|(4) | Includes realized and unrealized gains (losses) on securities transactions.
|--- | ---------------------------------------------------------------------------



-12-



27



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|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- | -------------------------------------------------------------------------------------

This report on Form 10-Q (the Report) for the quarter ending March 31, 2008 (First Quarter 2008) includes forward-looking statements that reflect the current expectations of
Preferred Investment Solutions Corp. (Preferred or the Managing Owner), the managing owner of Diversified Futures Trust I (Registrant), about the future results, performance, prospects and
opportunities of Registrant. The Managing Owner has tried to identify these forward-looking statements by using words such as may, will, expect, anticipate, believe, intend,
should, estimate or the negative of those terms or similar expressions. These forward-looking statements are based on information currently available to the Managing Owner and are subject to a number of risks, uncertainties
and other factors, both known, such as those described in this Report, and unknown, that could cause Registrants actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these
forward-looking statements.

You should not place undue reliance on any forward-looking statements. Except as expressly required by the Federal securities
laws, the Managing Owner undertakes no obligation to publicly update or revise any forward-looking statements or the risks, uncertainties or other factors described in this Report, as a result of new information, future events or changed
circumstances or for any other reason after the date of this Report.

Introduction

General

Registrant, a Delaware business trust,
was organized under the Delaware Statutory Trust Act on May 18, 1994 and will terminate on December 31, 2020 unless terminated sooner under the provisions of the Second Amended and Restated Declaration of Trust and Trust Agreement (the
Trust Agreement). Registrants trustee is Wilmington Trust Company. Registrant was formed to engage in the speculative trading of commodity futures and forward contracts. Registrants fiscal year for book and tax
purposes ends on December 31.

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

Managing Owner and its Affiliates

Preferred has been the managing owner of Registrant since October 1, 2004. The term Managing Owner, as used herein, refers to Preferred.

The Managing Owner is required to maintain at least a 1% interest in Registrant so long as it is acting as Registrants Managing Owner.

Effective January 1, 2007, Registrant became a member of and allocated all of its assets to WCM Pool LLC (the Trading Vehicle), a Delaware
limited liability company, and received a voting membership interest in the Trading Vehicle and became party to the Trading Vehicles Organization Agreement. The Trading Vehicle was formed to function as an aggregate trading vehicle for its
members. Registrant, Futures Strategic Trust, Diversified Futures Fund, L.P. and Kenmar Global Trust are the sole members of the Trading Vehicle. Preferred is the managing owner/general partner of each of these Trading Vehicle members and has been
delegated administrative authority over the operations of the Trading Vehicle. The Trading Vehicle engages in the speculative trading of futures and forwards contracts.

The Trading Vehicle has entered into an advisory agreement (the Trading Vehicle Advisory Agreement) with Winton Capital Management Limited (Winton), whereby Winton makes the
trading decisions for the Trading Vehicle and, in turn, Registrant, pursuant to Wintons Diversified Program. The Advisory Agreement may be terminated for various reasons, including at the discretion of the Trading Vehicle. Registrant has
allocated 100% of the proceeds from the initial and continuous offering of Registrant to the Trading Vehicle. Registrant, through its investment in the Trading Vehicle, pays a monthly management fee equal to 0.16667% (2% annually) of the assets
allocated to the Trading Advisor. Registrant, through its investment in the Trading Vehicle, pays Winton an incentive fee of 20% of New High Net Trading Profits (as defined in the Advisory Agreement) generated by the Trading Vehicle. Incentive fees
will accrue monthly and be paid quarterly in arrears.



28



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The term Trading Advisor, as used herein, refers to Winton Capital Management Limited
(Winton). The term Trading Advisory Agreement, as used herein, refers to the Trading Vehicle Advisory Agreement.

Competition

The Managing Owner and its affiliates have formed, and may continue to form, various entities to
engage in the speculative trading of futures and forward contracts that have certain of the same investment policies as Registrant.

Registrant does not
currently, and does not intend in the future to, solicit the sale of additional Interests. As such, Registrant does not compete with other entities to attract new fund participants. However, to the extent that a Trading Advisor recommends similar or
identical trades to Registrant and other accounts that it manages, Registrant may compete with those accounts, as well as with other market participants, for the execution of the same or similar trades.

Employees

Registrant has no employees.
Management and administrative services for Registrant are performed by the Managing Owner or third parties pursuant to the Trust Agreement, as further discussed in Notes 3 and 4 to Registrants financial statements included in its annual report
for the year ended December 31, 2007 (Registrants 2007 Annual Report), which is filed as an exhibit to Registrants Form 10-K for the fiscal year ended December 31, 2007.

Critical Accounting Policies

Preparation of the financial statements
and related disclosures in compliance with accounting principles generally accepted in the United States of America requires the application of appropriate accounting rules and guidance. Applying these policies requires the Managing Owner to make
judgments, estimates and assumptions in connection with the preparation of Registrants financial statements. Actual results may differ from the estimates used.

The Managing Owner has evaluated Registrants financial statements and related disclosures and has determined that the policies discussed below are critical accounting policies because they involve estimates,
judgments and assumptions that are particularly complex, subjective or uncertain. For a further discussion of Registrants significant accounting policies, see Note 2 to Registrants financial statements for the year ended
December 31, 2007, which is filed as an exhibit to Registrants annual report on Form 10-K for the fiscal year ended December 31, 2007.

The
valuation of Registrants investments that are not traded on a United States (US) or internationally recognized futures exchange is a critical accounting policy. The market values of futures (exchange traded) contracts is
verified by Registrants administrator, which obtains valuation data from third party data providers such as Bloomberg and Reuters and compares those prices with Registrants clearing broker. The market value of currency swap and forward
(non-exchange traded) contracts is extrapolated on a forward basis from the spot prices quoted as of 4 PM on the last business day of the reporting period. All values assigned by the administrator and confirmed by the Managing Owner are final and
conclusive as to all of Registrants Unitholders.

As such, if actual results vary from estimates used, they are not anticipated to have a material
impact on the financial statements and related disclosures.

Registrant records all investments at fair value in its financial statements, with changes in
fair value reported as a component of Trading Profits (Losses) in the Statements of Operations. Generally, fair values are based on quoted market prices; however, in certain circumstances, significant judgments and estimates are involved in
determining fair value in the absence of an active market closing price.

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



29



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earnings. In connection with the adoption of FIN 48, Registrant has elected an accounting policy to classify interest and penalties related to unrecognized
tax benefits as interest expense. The Managing Owner evaluated the impact of adopting FIN 48 on Registrants financial statements. In the Managing Owners opinion, the adoption of FIN 48 had no material impact on Registrant, as
Registrants tax positions are based on established tax precedence for the tax treatment of investment partnerships as flow through tax entities.

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

Registrant adopted SFAS 157 in the first quarter of 2008. The Managing Owner evaluated the impact that adoption of SFAS 157 will have on Registrants financial statements. Based on an analysis by the Managing
Owner, the effect of applying SFAS 157 to the investments included in Registrants financial statements will not result in a change to the fair value of Registrants investments. Approximately $0 or 0.00% of the Registrants
investment at March 31, 2008 is classified as Level 1 or Level 2 and $11,813,736 or 100.00% is classified as Level 3 using the fair value hierarchy of SFAS 157. Approximately $0 or 0.00% of Registrants investment at December 31, 2007
is classified as Level 1 or Level 2 and $11,055,308 or 100.00% is classified as Level 3 using the fair value hierarchy of SFAS 157. A table presenting the changes in the Level 3 fair value category for the three months ended March 31, 2008 is
provided in Note 5 of the Registrants financial statements. Of the $1,142,071 gain for the three months ended March 31, 2008 reported on Level 3 investments in Note 5, $(289,048) represents a change in unrealized allocated from the Trading
Vehicle on the Registrants condensed statement of operations.

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

Liquidity and
Capital Resources

Registrant commenced operations on January 5, 1995 with gross proceeds of $25,262,800 allocated to commodities trading.
Additional contributions raised through the continuous offering of limited interests (Limited Interests) and general interests (General Interests and, together with the Limited Interests,
Interests) of beneficial ownership in Registrant through August 31, 1996 resulted in additional gross proceeds to Registrant of $41,129,100. The continuous offering period ended on August 31, 1996.

Limited Interests in Registrant may be redeemed on a quarterly basis. For First Quarter 2008, redemptions of Limited Interests and General Interests were $135,686 and
$3,579, respectively. For First Quarter 2007, redemptions of Limited Interests and General Interests were $603,601 and $11,263, respectively. Future redemptions will impact the amount of funds available for investment in commodity contracts in
subsequent periods.

At March 31, 2008, 100.19% of Registrants net assets were allocated to commodities trading through its investment in the
Trading Vehicle. A significant portion of Registrants net assets invested in the Trading Vehicle was held in cash, which was used as margin for trading in commodities. In as much as the sole business of Registrant is to trade in commodities
(through its investment in the Trading Vehicle), Registrant continues to own such liquid assets to be used as margin. The clearing broker and bank credit the Trading Vehicle (and, in turn, Registrant, as a member of the Trading Vehicle) with
interest income on 100% of its average daily equity maintained in its accounts with the clearing broker and bank during each month at competitive interest rates.

The commodities contracts may be subject to periods of illiquidity because of market conditions, regulatory considerations and other reasons. For example, commodity exchanges limit fluctuations in certain commodity futures contract prices
during a single day by regulations referred to as daily limits. During a single day, no trades may be executed at prices beyond the daily limit. Once the price of a futures contract for a particular commodity has increased or decreased
by an amount equal to the daily limit, positions in the commodity can neither be taken nor liquidated unless traders are willing to effect trades at or within the limit. Commodity futures prices have occasionally moved the daily limit for several
consecutive days with little or no trading. Such market conditions could prevent the Trading Vehicle (and, in turn, Registrant) from promptly liquidating its commodity futures positions.



30



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Since Registrants business is to trade futures and forward contracts (through its investment in the Trading
Vehicle), its capital is at risk due to changes in the value of these contracts (market risk) or the inability of counterparties to perform under the terms of the contracts (credit risk). Registrants exposure to market risk is influenced by a
number of factors including the volatility of interest rates and foreign currency exchange rates, the liquidity of the markets in which the contracts are traded and the relationships among the contracts held. The inherent uncertainty of
Registrants speculative trading as well as the development of drastic market occurrences could result in losses considerably beyond Registrants experience to date and could ultimately lead to a loss of all or substantially all of
investors capital. The Managing Owner attempts to minimize these risks by requiring Registrant, the Trading Vehicle and the Trading Advisor to abide by various trading limitations and policies, which include limiting margin amounts, trading
only in liquid markets and permitting the use of stop loss provisions. For a further discussion of the credit and market risks associated with Registrants futures and forward contracts, see Note 7 to Registrants financial statements for
the year ended December 31, 2007, which is filed as an exhibit to Registrants annual report on Form 10-K for the fiscal year ended December 31, 2007.

Registrant does not have, nor does it expect to have, any capital assets.

Market Overview

Following is a market overview for First Quarter 2008 and First Quarter 2007:

First Quarter 2008

General market consensus is that the US is in a recession. The question remains how
long and deep it will be. Persistent liquidity problems, spreading credit market contagion and the worst stock market response to Federal Reserve (Fed) easing in the postwar era reveal the unusually intractable nature of the
problems with which the Fed is presently grappling with. Perhaps more telling is the inability of the Fed to arrest the spread of liquidity problems across the credit market landscape and recurring spikes in the Ted-spread, the difference between
the T-bill and LIBOR, and its extraordinarily high level, even after steep rate cuts and unprecedented actions through the discount window. Credit is the lifeblood of capitalist economies and a dysfunctional financial system appears to be
threatening the US and the global economies.

US Treasuries finished the first quarter lower than year end 2007. The 10-year yield benchmark fell
approximately to 3.41% from 4.00%. The 2-year yield was virtually unchanged in February but declined in March to near 1.60%. The 30-year note fell in March as well. The Fed lowered rates to 2.25% through three separate easing sessions during the
quarter, which is a 2% decline. On March 11, the Fed announced a plan to lend up to $200 billion of Treasury securities in exchange for debt, including private mortgage backed securities that have been in a severe slump as homeowners default on
payments. The biggest event of the quarter was the March 14 rescue of Bear Stearns & Co. Inc. through the sponsorship of the Fed and JP Morgan Chase & Co. after the investment house giant admitted its liquidity had
significantly declined.

US first quarter economic data displayed little indication of a speedy housing recovery. Housing starts fell, building permits
dropped to a 16-year low, confidence among home builders plummeted and mortgage delinquencies hit their highest levels since the Regan era. The outlook for employment worsened as the unemployment rate rose to 5.1% from 4.8%, which is the highest
level since September 2005. In March, nonfarm payrolls plunged and January and February estimates were significantly revised downward, which made the data even harder to swallow. As far as inflation is concerned, the Fed continues to express its
usual caution but the economic slump seems to be taking precedence.

Outside the US, European Central Bank (ECB) rates remained
unchanged throughout the first quarter and ECB president, Jean Claude Trichet, continued his hawkish stance giving no indication the ECB would detour from its tight monetary policy. Inflation in the Eurozone ran a bit high and closed the quarter at
3.50%. However, consumer and business confidence was stable. The Bank of England (BOE) seemed to be in an easing mode during the first three months of the year as UK economic data, housing in particular, were on the weak side.
Also, UK GDP was only 0.6% for the fourth quarter 2007 and the first quarter data does not appear to have improved. The Peoples Bank of the Republic of China maintained a tight monetary policy in an effort to curb inflation and comments from
the Bank indicate they might press tighter in the coming months as the inflation threat thickens. In addition, eyes are on the Tibet crisis and its impact on the upcoming summer Olympic Games. The Bank of Canada lowered its benchmark rate by 50
basis points on March 4 and Canadian GDP growth is minimal. The



31



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Bank of Japan remained on hold throughout the quarter. The Tankan report indicated decreased confidence as the manufacturing sector and the quarterly index
fell.

Currencies:The US Dollar remained under pressure for most of March, extending the patterns of January and February. During the quarter, the
US Dollar Index realized the weakest monthly close since its 1973 inception. Trading patterns in March were somewhat more two-sided than the straight down tone of January and February but the dollar was consistently unable to maintain consolidation
rallies. The dollar continues to suffer from diversification efforts by foreign central banks such as China, Russia and some petro nations.

The euro
continued its steep strengthening on the greenback through the first three months of 2008. The euro traded over an historical high-point prior to ending the quarter. The British pound concluded March little changed from February and January and
ended the period slightly lower than year-end 2007. UK housing prices declined for five consecutive months as the subprime/credit concerns still hounded the British landscape. After closing out February at a three-year low, the dollar lost
additional ground to the yen in March. The Japanese economy appears to be in better shape than the US as the yen continued its 2007 rally through to 2008. The Chinese yuan extended its gradual advance on the US dollar during the quarter. On a
positive note for the greenback, the dollar strengthened on the Canadian dollar, Korean won and South African rand.

Energies:Record highs were set
during the quarter as New York Mercantile Exchange crude futures traded over $110 in mid-March. Under Marchs commodity deleveraging pressure, oil dropped and closed the quarter with a year-to-date gain over 6% within the Dow Jones AIG Index
(DJAIG). A mid-March pipeline sabotage attempt in Iraq proved to be a limited disruption. Global demand, led primarily by China and India, remains the number one bullish factor for energy prices. Heating oil and natural gas
performed handsomely in the first quarter, ending with gains of over 12% and 32%, respectively. Reformulated gasoline declined almost 3% during the three months as refining margins have been lean and, thus, production has lagged.

Agriculturals:Prior to the deleveraging commodity drawdown in late March, a weakening US dollar and supply side deficits drove agricultural prices to
historical levels during the quarter. Corn began each month with prices on the upswing, which was followed at some point during the month with a temporary, profit taking sell-off. The fundamental reasons behind corns rally is the ethanol
story, the growing potential of an eventual global food shortage and capital flows pouring into this non-traditional asset class. Wheat started the year off rather stable trading in the $9 to $10 per bushel (pb) range.
As global fears of a wheat shortage hit the markets in February, prices launched to a record $25 pb but fell back to around $12 pb by the end of March, which capped off a positive quarter. Soybean prices encountered a similar trading pattern with a
28% increase by the end of February as increasing improvements in the quality of life in emerging nations drove the bean consumption pattern. As the March deleveraging took shape and rattled the markets, bean prices dropped 30%, ending the quarter
with an overall loss.

Indices:It was a rocky quarter for the global equity markets. Cash flowed heavily from stocks to alternative assets in the
wake of financial liquidity concerns and a weakening economic landscape. US stocks ended the quarter with their worst performance in six years. After a rally during the last week of the period, the Dow Jones Industrial Index finished down
approximately 7.6% for the quarter, with financial stocks among the worst performers. The NASDAQ and S&P 500 dove 14% and 9.4% for the quarter, respectively. The US indices were presented with challenges related to the US financial mess along
with the prolonged housing malaise.

Equities in Europe experienced their worst quarter in six years
as well. Similar to the US, a shift to alternative assets and the surrounding credit and liquidity disaster drove the negative performance. In contrast, Europe could count on the strength in the euro and sterling as compared to the weak dollar. The
broad based Dow Jones STOXX 600® index was down overall for the quarter. Financials, telecoms and tech represented the weakest sectors. The German DAX closed the quarter down nearly 19%.
The French CAC 40 ended the quarter with losses over 16%. Londons FTSE had the benefit of a more accommodative BOE but still lost more than 11.5% during the quarter.

Once again, Asia was a hotbed of volatility as the major indices incurred double-digit declines. Akin to the US and Europe, financial and credit issues were key negative factors. Japan was impacted by negative
economic data and, unlike the US, Japan concluded the period on a defensive note. The Nikkei lost 2.3% in the final session, finishing down over 18% for the quarter. In Hong Kong, the Hang Seng Index exhibited extreme volatility and ended the
quarter with an almost 19% loss. In Australia, the All Ordinaries Index benefited from high commodity prices but not from the Reserve Banks very tight monetary policy and ended the quarter down roughly 15.7%



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Metals:March was a bumpy month for gold. The metal reached an all-time high of approximately $1,034 on
March 17. Also, commodities as an asset group experienced deleveraging, the result being a slide in gold prices. The quarter closed at over $921, resulting in a loss of approximately 6% for March, lowering the quarterly gain to plus 8.5%.
Silver followed its parasitic role and followed gold through a very volatile trading pattern and finished with strong quarterly performance over 15%. The slowing demand for jewelry had less of an impact on silver than on gold. Platinum had a
positive month but prices were rocky as Asian demand for jewelry cooled and power and labor problems in South Africa remained a concern. Palladium followed suit and had a positive quarter.

Prices increased across the board for base metals during the first quarter despite being affected by the deleveraging process in March. Copper gained a hefty 25.7% as
demand outside the US remained strong. Power problems in South Africa and China lent support to aluminum. Increasing stainless steel production and demand resulted in an approximate 9.4% gain for nickel within the DJAIG. Mounting battery related
demand and a narrowing production deficit resulted in a profitable quarter for lead. Tin and zinc witnessed profitable quarters as well.

Softs and
Livestock:During the quarter, sugar prices exhibited extreme volatility, falling over 20% in March after a stellar February, bringing their quarterly gain to over 4% within the DJAIG. Higher production forecasts and inventory levels and the
commodity pull-back were factors that promoted the 20% drop in March. Coffee lost over 8% within the DJAIG for the quarter and was the indexs worst performance component for March. Cocoa hit a 28-year high during the period and finished the
quarter with positive overall performance. Citrus prices fell about 24% on indications of increased production as inventories topped two-year levels.

Live cattle extended its 2007 slide into the first quarter as performance finished down over 13.4%. Some blame the economic slump and oversupply for bad performance. After plummeting a hefty 11.6% in March, live hogs hold the dubious honor
of being the weakest component within the DJAIG during the first quarter, closing down over 18.5%. On a positive note, demand in Asia remained strong.

First Quarter 2007

The US Federal Reserve (the Fed) remained on hold throughout First
Quarter 2007 after having moved away from the tightening bias cycle in the fourth quarter of 2006. As the second quarter of 2007 began, the Federal Open Market Committee minutes indicate a growing concern with the potential for an economic slowdown,
but at the same time, inflation remains the Feds primary focus. Treasury yields were in an almost constant downtrend in the fourth quarter of 2006 and hit an eleven month low last November, but the pattern in First Quarter 2007 was more two
sided. Some steepening of the yield curve was noted during First Quarter 2007.

Housing persists as a major focus and potentially the largest threat to the
US economy. The February housing report did exhibit something of a bounce in housing as starts rose 9% in February 2007 after falling 14% in January 2007. The more forward-looking housing permits declined for the twelfth time in thirteen months.
Housing starts are down more than 26% and housing permits more than 28% from 2006, to put the situation in perspective. In addition, inventories are burdensome and the median home sale price fell over 1% year-on-year. Ongoing concerns in the
sub-prime mortgage sector had an impact on the housing sector, but its potential spread into the prime mortgage sector seems to have been contained for the moment.

On the inflation front, the Core Personal Consumption Price Index, one of the Feds closely watched measures, rose 0.3% in February 2007, the most since August 2006 and most importantly year-on-year it rose above the Feds target.
The Consumer Price Index (CPI) was up 0.4% and the Core CPI rose 0.2% as food and energy prices climbed. During First Quarter 2007, food is up dramatically within the CPI. Meanwhile, the Producer Price Index
(PPI) has also risen, unexpectedly jumping 1.8% in February 2007, with the Core rising 0.4% during that same period.

Fourth quarter
2006 Gross Domestic Product (GDP) was revised upwards slightly but economists forecast the first quarter 2007 figures to remain steady. Healthy unemployment data from the fourth quarter of 2006 extended into First Quarter 2007,
including an increase in non-farm payrolls and a decline to 4.4% in the unemployment rate. Consumer Confidence numbers were off a bit in the quarter, but remained relatively strong. Retail sales were relatively weak for the quarter, but still above
year ago levels. Manufacturing indices were mixed but construction spending held well. As the second quarter begins, the US economy seems to be lagging as indicated in the International Monetary Fund projections while Asia and Europe appear
considerably more buoyant.



33



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The Eurozones economy seems to have solid momentum, as does the UK, after a strong First Quarter 2007 performance.
Not surprisingly, the euro rose to a two-year high. Global imbalances were a focus in the quarter, evidenced particularly by the yen carry trade. The European Central Bank (ECB) held rates steady at the April meeting after hiking
them 25 basis points in March, and ECB President Trichet sounded hawkish in his latest commentary. The Bank of England increased rates 25 basis points in January to 5.25%. The Swiss National Bank also increased rates 25 basis points to 2.25%. Of
note, European and Asian equity markets surged late in the first quarter and featured strong earnings and robust merger and acquisition (M&A) activity.

The Bank of Japan continues to pursue a conservative policy as it remained on hold in April after a 0.25% increase in February. The Japanese economy displayed a mixed pattern of economic data that shows the economy
generally improving, albeit modestly, with little inflation threat. China continued its expansion, growing over 10% in the quarter despite forecasts from many of a significant slowdown. The Peoples Bank of China has been in a tightening mode,
but this has not slowed the growth pace. The Bank of Canada was on hold during the quarter. However, there is speculation that the Reserve Bank of Australia could raise rates in May.

Currencies:The US Dollar ended a negative month and quarter on a weak note after the US imposed trade sanctions on paper imports against China, the first time in 23 years that US duty law has been applied to
imports from that country. Some describe the move as a potential watershed event in US/Peoples Republic of China relations; currency traders viewed the action as important. Throughout February and March, the yen was the currency in focus, with
the carry trade drawing the most attention. While the attention was warranted at the time, the crisis quieted by the end of March.

The euro
closed the quarter with a slight gain from year-end. Mostly strong European Union (EU) economic data were noted, including solid numbers for the German economy, considered the regions engine of growth. The German
VAT increase has not caused the dire consequences some projected. German unemployment fell to a six-year low, while data from France and Italy has been mostly buoyant. The British pound closed out the quarter modestly higher over the 2006 finish.
The Chinese yuan gained against the dollar in the first quarter.

The latest US Trade Report showed the nations deficit narrowing in January, the
fourth narrowing in five months. Exports hit record levels and imports declined slightly. Capital goods exports achieved record levels but the petroleum deficit widened. The deficit with China widened, while the deficit with the EU was the lowest
since January 2004.

Energies:Crude oil futures were mixed during the quarter, but finished up slightly overall. March featured an increased terror
premium, mostly related to the Iran/UK naval hostage situation. OPEC production was supportive and the latest Department of Energy (DOE) data show crude inventories slightly lower than last year. A series of refinery outages, some
expected maintenance and some unanticipated repairs added to the bullish scenario for crude prices. Buoyant product demand and reduced imports also lent support. Gasoline futures finished the quarter up strongly. Despite a recent surge in pump
prices, demand remains slightly higher than last year. Lower overall European gasoline production and the various US refinery outages point to continuing tight supplies, supported by strong crude prices.

Heating oil prices ended the quarter more than 11% higher than they were at the start of 2007. The DOE reports that inventories are below last seasons, while
demand remains near 2006 levels. The winter temperature overall was slightly above normal but the February cold snap increased demand considerably.

Natural gas prices were quite volatile during the first quarter of the year and ended up over 17% higher than at the start of the year. The weather will play a key role in the coming weeks; El Niño years have historically led to
warmer than normal summers, a potentially bullish influence to accompany forecasters predictions of an active hurricane season.

Grains:The corn market saw a 23% increase in prices overall for the quarter. However, after a robust start
spurred on by bullish USDA Supply/Demand reports in January and February, March brought no new data and the market began to fade. On March 30th, the release of the annual Planting Intentions Report drove prices sharply lower with its estimates of a 15% increase in estimated corn acreage. The soybean market went into a sideways stall during March, in deference to the
price-appreciating pattern seen during the first two months of the quarter. The increase in corn acreage came at the expense of many other crops, not the least of which was soybeans, projected by the report to be down 11% in acreage. In addition,
the auspices of a threatening hurricane season, combined with this summers expected El Niño conditions, has some market participants questioning supply predictions. Wheat prices



34



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broke down through the quarters supporting price floor during March. Given the ongoing drought conditions in Australia, one of the worlds largest
wheat growing and exporting nations, and the expected higher corn prices that will necessitate longer cattle grazing, farmers are reported to be intending to increase plantings by 10%. Cotton prices languished in a range for the entire quarter. Not
even a surprising 20% plantings report reduction in cotton acreage could spur the market, given the current supply overhang stemming from the non-recourse Loan Program provisions.

Indices:US equity markets turned in mixed and volatile performance for the quarter as a whole. The Dow Jones Industrial Average ended in negative territory, while the S&P 500 and NASDAQ indices managed
meager gains. The UK/Iran political crisis, fears surrounding the Japanese yen carry trade, imposition of trade sanctions on China and sub-prime mortgage market concerns were all major issues affecting the markets. Uncertainty was one of the
buzzwords of the quarter, but US and global market inflows and spectacular M&A activity pointed in the bullish direction.

The brisk flow of foreign
capital into European equities during the quarter was also a contributing factor in the increase in European equities. Heavy M&A, solid earnings and mostly buoyant EU and UK economic data led the way from a fundamental perspective.

Asian equities experienced a volatile ride in the quarter, but after being under severe pressure due to carry trade and liquidity related factors in February and into
early March, they rallied back strongly to all-time highs in late March.

Interest Rates:US treasuries engaged in erratic and, at times, volatile
trading patterns in March, but ended the quarter higher overall. Early in the month, bonds attracted considerable flight to safety and risk aversion support as related to carry trade and sub-prime concerns but that lessened considerably by
months end with some of the buying reversed. The final week of March saw the yield curve steepening with the majority of the move at the long end. Housing remains a primary concern and perhaps the greatest risk to the US economy.

Outside of the US, the European Central Bank (ECB) raised rates in March as but held steady in April as they look to slow ample liquidity and
growth in Germany, France and Italy. ECB President Trichet expressed concerns about demand growth and increasing wage demands, particularly in Germany. The Bank of England held rates unchanged at both the March and April meetings. Recent UK
inflation data has shown improvement, lessening the potential for a near term rate hike. The Bank of Japan was also on hold given that recent economic data from Japan has been mixed. In China, the Peoples Bank continues to tighten liquidity as
the economy roars ahead at a near 11% GDP pace. The Bank of Canada and Reserve Bank of Australia were on hold during the quarter.

Metals:Both gold
and silver prices struggled a bit in March, but continued their overall upward trend during the quarter. Platinum prices ended higher for the quarter, with increased volatility. Sister metal palladium also rose on buoyant industrial demand. Copper
prices were highly volatile during the first quarter, as virtually all commodities were impacted by the global liquidity crunch related primarily to the yen carry trade. Import data from China has signaled continued strong demand. Nickel prices
surged over 42% during the quarter on continued supply deficits. Demand levels for stainless steel continue to expand. Aluminum ended the quarter virtually unchanged and has been one of the quietest of the metal markets. Zinc prices fell over 20%
during the quarter mostly due to high levels of exports from China. Lead prices advanced as did tin prices, the latter impacted somewhat by Indonesian supply disruptions.

Softs:Sugar prices fell over 15% during First Quarter 2007, reflecting a growing global surplus and slow physical sugar sales in March. Coffee prices also ended the quarter approximately 15% lower primarily
due to improved crop prospects from Brazil. Cocoa prices, on the other hand, rose to their highest levels since May of 2003 on estimates of a smaller than expected West African crop yield and indications that end users are not well hedged. Live
cattle prices rose slightly for the quarter. However, improved feeding conditions in the Midwest dampened enthusiasm somewhat. Although hogs have benefited from recent rises in retail beef prices, hog prices during the quarter were weighed down with
seasonally slack demand and the USDA corn report.

Sector Performance

Due to the nature of Registrants trading activities, a period-to-period comparison of its trading results is not meaningful. However, a discussion of Registrants trading results for the major sectors in
which Registrant traded for First Quarter 2008 and First Quarter 2007 are presented below.



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First Quarter 2008

Currencies: (+) This sector experienced a majority of its gains in the Swiss franc, euro, Australian dollar, Japanese yen, Brazilian real, Mexican peso and Polish zloty. The majority of losses were
experienced in the British pound, Canadian dollar and the euro versus the Japanese yen.

Energies: (+)This sector experienced gains in
gasoline, heating oil, crude oil and gas oil. Losses were incurred in natural gas.

Grains: (+)This sector experienced gains in corn, bean
oil, canola oil, wheat, soy oil and soybeans. Losses were seen in cotton and soybean meal.

Indices: (-)This sector experienced a majority of its
losses in the All Ordinaries, DAX, DJ Stoxx 50, Dow Jones Industrial Average, S&P 500 and Taiwan SIMEX. The majority of gains were made in the CAC 40, Nikkei and the FTSE 100.

Interest Rates: (+)This sector experienced a majority of its gains in Eurodollars Japanese Government Bonds, US Treasury Notes and the German Bund. The majority of losses were incurred in Australian
Bonds, Eurobonds and British Gilts.

Meats: (+)This sector experienced gains in feeder cattle and live hogs. Losses were incurred in live
cattle.

Metals: (+)This sector experienced losses in copper, aluminum, zinc and nickel. Gains were made in gold, platinum and silver.

Softs: (+) This sector experienced gains in coffee and cocoa. Losses were seen in sugar.

First Quarter 2007

Currencies: (-)
Losses were experienced in the Australian dollar, British pound, Canadian dollar, Czech koruna, euro, Japanese yen vs. euro cross, Japanese yen, Mexican peso, Polish zloty, South African rand and Swiss franc. Gains were made in the Brazilian real,
British pound versus Japanese yen cross, Hungarian forint and New Zealand dollar.

Energies: (-)Losses were experienced in gas oil, gasoline,
heating oil and natural gas. Gains were experienced in Brent crude and crude oil.

Grains: (-)Losses were experienced in corn, soybeans, soybean
meal and wheat. Gains were experienced in canola oil, cotton and soybean oil.

Indices: (-) Losses were experienced in the CAC 40, the DJ Stoxx 50,
the Dow Jones Industrial Average, the FTSE 100, the Hang Seng, the Nasdaq 100, the Nikkei, the Russell 2000, the S&P MIB 30, the S&P 500 and the Taiwan Index. Gains were experienced in the Australian All Ordinaries, the DAX, the IBEX 35, the
S&P Mid-Cap 400 and the S&P TSE 60.

Interest Rates: (-)Losses were experienced in Australian Bank Bills and 3-year and 10-year Bonds,
Canadian Bank Acceptances and Bonds, Euribor, Eurodollar, Euroswiss, German 2-year, 5-year, 10-year and 30-year Bonds, Swiss Bonds, U.K. Gilts, U.S. Treasury Bonds and U.S. 2-year, 5-year and 10-year Treasury Notes. Gains were experienced in
Euroyen, Japanese Government Bonds, New Zealand Treasury Bills and Short Sterling.

Metals: (+)Losses were experienced in copper, platinum,
silver and zinc. Gains were experienced in aluminum, gold, lead and nickel.

Softs (-):Losses were experienced in
cattle, coffee and hogs. Gains were experienced in cocoa and sugar.

Results of Operations

The net asset value (Net Asset Value) per Interest as of March 31, 2008 was $255.64, an increase of 8.49% from the December 31, 2007 Net
Asset Value per Interest of $235.63. The Net Asset Value per Interest as of March 31,



36



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2007 was $201.12, a decrease of 9.69% from the December 31, 2006 Net Asset Value per Interest of $222.71. Past performance is not necessarily indicative
of future results.

Registrants trading gains (losses) before commissions and related fees during First Quarter 2008 and First Quarter 2007 were
approximately $1,451,000 and ($1,088,000), respectively.

Interest income is earned on the average daily equity maintained with the clearing broker or bank
at competitive interest rates and, therefore, varies monthly according to interest rates, trading performance and redemptions. Interest income during First Quarter 2008 was approximately $52,000, a decrease of approximately $94,000 as compared to
First Quarter 2007 primarily due to declining interest rates and reduced average net asset levels primarily due to redemptions. Interest income was approximately $146,000 for the First Quarter 2007, a decrease of approximately $36,000 as compared to
First Quarter 2006 primarily due to the impact of reduced average net asset levels. Higher interest rates during the First Quarter 2007 as compared to First Quarter 2006 did not fully offset the impact of redemptions.

Commissions are calculated on Registrants Net Asset Value at the beginning of each month and therefore, vary according to monthly trading performance and
redemptions. Other transaction fees consist of National Futures Association, exchange and clearing fees as well as floor brokerage costs and give-up charges, which are based on the number of trades the Trading Advisor executes, as well as which
exchange, clearing firm or bank on, or through, which the contract is traded. Commissions and other transaction fees during First Quarter 2008 were approximately $223,000, a decrease of approximately $27,000 as compared to First Quarter 2007
primarily due to a decline in average net asset levels as discussed above. Commissions and other transaction fees during the First Quarter 2007 were approximately $249,000, a decrease of approximately $74,000 as compared to First Quarter 2006
primarily due to a decline in the average net asset levels as discussed above.

Management fees are calculated on the net asset value of Registrants
investment in the Trading Vehicle at the end of each month, and therefore, are affected by trading performance and redemptions. Management fees were approximately $60,000 in First Quarter 2008, a decrease of approximately $1,000 as compared to First
Quarter 2007 primarily due to a decline in the average net asset levels as discussed above. Management fees were approximately $62,000 for the First Quarter 2007, a decrease of approximately $22,000 in First Quarter 2007 as compared to First Quarter
2006 primarily due to a decline in the average net asset levels as discussed above.

Incentive fees, which are based on the New High Net Trading
Profits (as defined in the Advisory Agreement) generated by the Trading Advisor, are accrued monthly and are ultimately determined as of the close of business on the last business day of each calendar quarter. Incentive fees were approximately
$272,000 in First Quarter 2008. No incentive fees were earned during First Quarter 2007.

General and administrative expenses were approximately $15,000
and $5,000 during First Quarter 2008 and First Quarter 2007, respectively. These expenses charged to the Registrant by its investment in the Trading Vehicle include accounting, audit, tax, and legal fees, as well as printing and postage costs
related to reports sent to limited owners.

Inflation

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

Off-Balance Sheet Arrangements and Contractual Obligations

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

Registrants
contractual obligations are with the Managing Owner and the Trading Vehicle and, as a result of its investment in the Trading Vehicle, with the Trading Advisor and the Trading Vehicles commodity broker. Management fees payable by Registrant to
the Trading Advisor (through its investment in the Trading Vehicle) and



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the Managing Owner are calculated as a fixed percentage of the Trading Vehicle and Registrants Net Asset Value, respectively. Incentive fees payable by
the Registrant to the Trading Advisor (through its investment in the Trading Vehicle) are at a fixed rate, calculated as a percentage of the Trading Vehicles New High Net Trading Profits. As such, the Managing Owner cannot
anticipate the amounts to be paid for future periods as Net Asset Values and New High Net Trading Profits are not known until a future date. Commissions payable to the Trading Vehicles commodity broker are based on a cost per
executed trade and, as such, the Managing Owner cannot anticipate the amount that will be required under the brokerage agreement, as the level of executed trades are not known until a future date. These agreements are effective for one-year terms,
renewable automatically for additional one-year terms unless terminated. Additionally, these agreements may be terminated by either party thereto for various reasons. For a further discussion of Registrants contractual obligations, see Notes
1, 3 and 4 to Registrants financial statements for the year ended December 31, 2007, which is filed as an exhibit to Registrants annual report on Form 10-K for the fiscal year ended December 31, 2007.



|Item 3. | Quantitative and Qualitative Disclosures About Market Risk
|------- | ----------------------------------------------------------

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



|Item 4. | Controls and Procedures
|------- | -----------------------

Evaluation of Disclosure Controls
and Procedures

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

In designing and evaluating Registrants disclosure controls and procedures,
the Managing Owner recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and
procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

The Managing Owners management, under the supervision and with the participation of certain officers of the Managing Owner (including the Managing Owners
Co-Chief Executive Officers and Director of Fund Administration), has evaluated the effectiveness of Registrants disclosure controls and procedures as of the end of the period covered by this report. Based upon such evaluation, the Managing
Owners Co-Chief Executive Officers and Director of Fund Administration have concluded that, as of the end of such period, Registrants disclosure controls and procedures are effective.

Changes in Internal Control Over Financial Reporting

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

PART II  OTHER INFORMATION



|Item 1. | Legal Proceedings
|------- | -----------------

There are no legal proceedings pending by or
against Registrant or the Managing Owner, or to which Registrant or Managing Owner was a party during the period covered by this Report.



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|Item 1.A. | Risk Factors
|--------- | ------------

There have been no changes from risk factors as
previously disclosed in Registrants Form 10-K for the fiscal year ended December 31, 2007.



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds
|------- | -----------------------------------------------------------

None



|Item 3. | Defaults Upon Senior Securities
|------- | -------------------------------

None



|Item 4. | Submission of Matters to a Vote of Security Holders
|------- | ---------------------------------------------------

None



|Item 5. | Other Information
|------- | -----------------

None



|Item 6. | Exhibits:
|------- | ---------



|     |  |                                                                                                                                       
|---- |  | --------------------------------------------------------------------------------------------------------------------------------------
|     | 
|31.1 |  | Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)                                                       
|     | 
|31.2 |  | Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 (filed herewith)                                                       
|     | 
|32.1 |  | Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)
|     | 
|32.2 |  | Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)

[Remainder of page left blank intentionally.]



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SIGNATURES

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



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|--------------------------- |  | -------------------------------------------------------- |  |  |  |  |  |  |  |  |  | 
|DIVERSIFIED FUTURES TRUST I |  |                                                          |  | 
|                            |  |                                                          | 
|By:                         |  | Preferred Investment Solutions Corp., its
managing owner |  |  |  | 



| |  |     |  |                       |  |                                                          |  |                    |  |  |  | 
| |  | --- |  | --------------------- |  | -------------------------------------------------------- |  | ------------------ |  |  |  | 
| |  |     |  |                      
| |  | By: |  | /s/ Kenneth A. Shewer |  |                                                          |  | Date: May 15, 2008
| |  |     |  | Name:                 |  | Kenneth A. Shewer                                        |  |                    |  |  |  | 
| |  |     |  | Title:                |  | Co-Chief Executive Officer (Principal Executive Officer) |  |                    |  |  |  | 



| |  |     |  |                    |  |                                                                                                    |  |                    |  |  |  | 
| |  | --- |  | ------------------ |  | -------------------------------------------------------------------------------------------------- |  | ------------------ |  |  |  | 
| |  |     |  |                   
| |  | By: |  | /s/ David K. Spohr |  |                                                                                                    |  | Date: May 15, 2008
| |  |     |  | Name:              |  | David K. Spohr                                                                                     |  |                    |  |  |  | 
| |  |     |  | Title:             |  | Senior Vice President and Director of Fund Administration (Principal Financial/Accounting Officer) |  |                    |  |  |  |