|   | MORGAN STANLEY SMITH BARNEY CHARTER GRAHAM L.P.        |   |
|--------|--------------------------------------------------------|--------|
|   | (Exact name of registrant as specified in its charter) |   |

|                                     | Delaware                                                                                                              |       | 13-4018068                          |
|------------------------------------------|-----------------------------------------------------------------------------------------------------------------------|------------|-------------------------------------|
|                                     |      (State or other jurisdiction of      incorporation or organization) |       | (I.R.S. EmployerIdentification No.) |
|                                     |                                                                                                                  |       |                                |
| Demeter Management LLC                   |                                                                                                                  |       |
| 522 Fifth Avenue, 13th Floor             |                                                                                                                  |       |
| New York, NY                             |                                                                                                                  | 10036      |
| (Address of principal executive offices) |                                                                                                                  | (Zip Code) |

| Registrant’s telephone number, including area code |   | (212) 296-1999 |
|----------------------------------------------------------|--------|----------------|

| Large accelerated filer o | Accelerated filer o         |
|---------------------------|-----------------------------|
| Non-accelerated filer x   | Smaller reporting company o |

----

|     | PART I. FINANCIAL INFORMATION                                                                    |             |
|----------|--------------------------------------------------------------------------------------------------|------------------|
|     |                                                                                             |             |
| Item 1.  | Financial Statements (Unaudited)                                                                 |             |
|     |                                                                                             |             |
|     | Statements of Financial Condition as of June 30, 2010 and December 31, 2009                      | 2                |
|     |                                                                                             |             |
|     | Statements of Operations for the Three and Six Months Ended June 30, 2010 and 2009               | 3                |
|     |                                                                                             |             |
|     | Statements of Changes in Partners’ Capital for the Six Months Ended June 30, 2010 and 2009 | 4                |
|     |                                                                                             |             |
|     | Statements of Cash Flows for the Six Months Ended June 30, 2010 and 2009                         | 5                |
|     |                                                                                             |             |
|     | Condensed Schedules of Investments as of June 30, 2010 and December 31, 2009                     | 6                |
|     |                                                                                             |             |
|     | Notes to Financial Statements                                                                    |   7-22 |
|     |                                                                                             |             |
| Item 2.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations      | 23-33            |
|     |                                                                                             |             |
| Item 3.  | Quantitative and Qualitative Disclosures About Market Risk                                       | 34-45            |
|     |                                                                                             |             |
| Item 4.  | Controls and Procedures                                                                          | 45-46            |
|     |                                                                                             |             |
|     | PART II. OTHER INFORMATION                                                                       |             |
|     |                                                                                             |             |
| Item 1A. | Risk Factors                                                                                     | 47               |
|     |                                                                                             |             |
| Item 6.  | Exhibits                                                                                         | 47               |

----

|                                                                     | June 30,    |   | December 31, |
|--------------------------------------------------------------------------|-------------|--------|--------------|
|                                                                     | 2010        |   | 2009         |
| ASSETS                                                                   | $           |   | $            |
|                                                                     |        |   |         |
| Trading Equity:                                                          |        |   |         |
|                                                                     |        |   |         |
| Unrestricted cash                                                        | 337,910,123 |   | 371,818,291  |
| Restricted cash                                                          | 20,393,312  |   | 32,234,772   |
|                                                                     |        |   |         |
| Total cash                                                               | 358,303,435 |   | 404,053,063  |
|                                                                     |        |   |         |
| Net unrealized gain (loss) on open contracts (MS&Co.)                | (1,889,643) |   | 2,122,029    |
| Net unrealized gain on open contracts (MSIP)                             | 82,346      |   | 3,799,477    |
|                                                                     |        |   |         |
| Total net unrealized gain (loss) on open contracts                       | (1,807,297) |   | 5,921,506    |
|                                                                     |        |   |         |
| Total Trading Equity                                                     | 356,496,138 |   | 409,974,569  |
|                                                                     |        |   |         |
| Interest receivable (MSSB)                                               | 21,251      |   | 4,329        |
|                                                                     |        |   |         |
| Total Assets                                                             | 356,517,389 |   | 409,978,898  |
|                                                                     |        |   |         |
| LIABILITIES AND PARTNERS’ CAPITAL                                  |        |   |         |
|                                                                     |        |   |         |
| Liabilities                                                              |        |   |         |
|                                                                     |        |   |         |
| Redemptions payable                                                      | 5,003,588   |   | 7,234,689    |
| Accrued brokerage fees (MS&Co.)                                      | 1,808,214   |   | 2,126,799    |
| Accrued management fees                                                  | 602,738     |   | 708,933      |
|                                                                     |        |   |         |
| Total Liabilities                                                        | 7,414,540   |   | 10,070,421   |
|                                                                     |        |   |         |
| Partners’ Capital                                                  |        |   |         |
|                                                                     |        |   |         |
| Limited Partners (12,825,217.761 and 13,699,445.230 Units, respectively) | 345,590,777 |   | 395,815,421  |
| General Partner (130,336.501 and 141,663.501 Units, respectively)        | 3,512,072   |   | 4,093,056    |
|                                                                     |        |   |         |
| Total Partners’ Capital                                            | 349,102,849 |   | 399,908,477  |
|                                                                     |        |   |         |
| Total Liabilities and Partners’ Capital                            | 356,517,389 |   | 409,978,898  |
|                                                                     |        |   |         |
| NET ASSET VALUE PER UNIT                                                 | 26.95       |   | 28.89        |

----

|                                                    |                                                      |   |                                   |
|---------------------------------------------------------|-----------------------------------------------------------|--------|----------------------------------------|
|                                                    |   For the Three MonthsEnded June  30, |   | For the Six Months Ended June 30, |
|                                                    |                                                      |   |                                   |   |   |   |   |
|                                                    | 2010                                                      |   | 2009                                   |   | 2010 |   | 2009 |
|                                                    | $                                                         |   | $                                      |   | $ |   | $ |
| INVESTMENT INCOME                                       |                                                      |   |                                   |   |   |   |   |
| Interest income (MSSB)                                  | 103,715                                                   |   | 91,079                                 |   | 141,798 |   | 258,805 |
|                                                    |                                                      |   |                                   |   |   |   |   |
| EXPENSES                                                |                                                      |   |                                   |   |   |   |   |
| Brokerage fees (MS&Co.)                             | 5,509,085                                                 |   | 6,513,959                              |   | 11,113,052 |   | 14,067,392 |
| Management fees                                         | 1,836,361                                                 |   | 2,171,320                              |   | 3,704,351 |   | 4,689,131 |
| Incentive fee                                           | –                                                   |   | –                                |   | – |   | 1,873,519 |
|                                                    |                                                      |   |                                   |   |   |   |   |
| Total Expenses                                          | 7,345,446                                                 |   | 8,685,279                              |   | 14,817,403 |   | 20,630,042 |
|                                                    |                                                      |   |                                   |   |   |   |   |
| NET INVESTMENT LOSS                                     | (7,241,731)                                               |   | (8,594,200)                            |   | (14,675,605) |   | (20,371,237) |
|                                                    |                                                      |   |                                   |   |   |   |   |
| TRADING RESULTS                                         |                                                      |   |                                   |   |   |   |   |
| Trading profit (loss):                                  |                                                      |   |                                   |   |   |   |   |
| Realized                                                | 14,995,184                                                |   | (9,085,134)                            |   | (4,379,447) |   | (10,321,138) |
| Net change in unrealized                                | (13,701,171)                                              |   | (210,273)                              |   | (7,728,803) |   | (4,017,070) |
|                                                    |                                                      |   |                                   |   |   |   |   |
| Total Trading Results                                   | 1,294,013                                                 |   | (9,295,407)                            |   | (12,108,250) |   | (14,338,208) |
|                                                    |                                                      |   |                                   |   |   |   |   |
| NET LOSS                                                | (5,947,718)                                               |   | (17,889,607)                           |   | (26,783,855) |   | (34,709,445) |
|                                                    |                                                      |   |                                   |   |   |   |   |
| NET LOSS ALLOCATION                                     |                                                      |   |                                   |   |   |   |   |
|                                                    |                                                      |   |                                   |   |   |   |   |
| Limited Partners                                        | (5,887,798)                                               |   | (17,706,079)                           |   | (26,509,284) |   | (34,356,786) |
| General Partner                                         | (59,920)                                                  |   | (183,528)                              |   | (274,571) |   | (352,659) |
|                                                    |                                                      |   |                                   |   |   |   |   |
| NET LOSS PER UNIT *                                     |                                                      |   |                                   |   |   |   |   |
|                                                    |                                                      |   |                                   |   |   |   |   |
| Limited Partners                                        | (0.45)                                                    |   | (1.16)                                 |   | (1.94) |   | (2.14) |
| General Partner                                         | (0.45)                                                    |   | (1.16)                                 |   | (1.94) |   | (2.14) |
|                                                    |                                                      |   |                                   |   |   |   |   |
|                                                    | Units                                                     |   | Units                                  |   | Units |   | Units |
| WEIGHTED AVERAGE NUMBER  OF UNITS OUTSTANDING |  13,319,042.930                                      |   |  15,422,267.109                   |   |  13,521,769.147 |   |  16,184,112.656 |
|                                                    |                                                      |   |                                   |   |   |   |   |

----

|                     | Units of        |   |         |   |      |   |         |
|--------------------------|-----------------|--------|--------------|--------|-----------|--------|--------------|
|                     | Partnership     |   | Limited      |   | General   |   |         |
|                     | Interest        |   | Partners     |   | Partner   |   | Total        |
|                     |            |   | $            |   | $         |   | $            |
| Partners’ Capital, |            |   |         |   |      |   |         |
| December 31, 2009        | 13,841,108.731  |   | 395,815,421  |   | 4,093,056 |   | 399,908,477  |
|                     |            |   |         |   |      |   |         |
| Net Loss                 | –         |   | (26,509,284) |   | (274,571) |   | (26,783,855) |
|                     |            |   |         |   |      |   |         |
| Redemptions              | (885,554.469)   |   | (23,715,360) |   | (306,413) |   | (24,021,773) |
|                     |            |   |         |   |      |   |         |
| Partners’ Capital, |            |   |         |   |      |   |         |
| June 30, 2010            | 12,955,554.262  |   | 345,590,777  |   | 3,512,072 |   | 349,102,849  |
|                     |            |   |         |   |      |   |         |
|                     |            |   |         |   |      |   |         |
|                     |            |   |         |   |      |   |         |
|                     |            |   |         |   |      |   |         |
| Partners’ Capital, |            |   |         |   |      |   |         |
| December 31, 2008        | 18,009,881.252  |   | 519,261,648  |   | 5,276,301 |   | 524,537,949  |
|                     |            |   |         |   |      |   |         |
| Net Loss                 | –         |   | (34,356,786) |   | (352,659) |   | (34,709,445) |
|                     |            |   |         |   |      |   |         |
| Redemptions              | (2,922,506.194) |   | (82,785,598) |   | (839,674) |   | (83,625,272) |
|                     |            |   |         |   |      |   |         |
| Partners’ Capital, |            |   |         |   |      |   |         |
| June 30, 2009            | 15,087,375.058  |   | 402,119,264  |   | 4,083,968 |   | 406,203,232  |

----

|                                     | For the Six Months Ended June 30, |
|------------------------------------------|-----------------------------------|
|                                     |                              |   |   |
|                                     | 2010                              |   | 2009 |
|                                     | $                                 |   | $ |
| CASH FLOWS FROM OPERATING ACTIVITIES     |                              |   |   |
|                                     |                              |   |   |
| Net loss                                 | (26,783,855)                      |   | (34,709,445) |
| Noncash item included in net loss:       |                              |   |   |
| Net change in unrealized                 | 7,728,803                         |   | 4,017,070 |
|                                     |                              |   |   |
| (Increase) decrease in operating assets: |                              |   |   |
| Restricted cash                          | 11,841,460                        |   | (22,201,288) |
| Interest receivable (MSSB)               | (16,922)                          |   | 7,299 |
|                                     |                              |   |   |
| Decrease in operating liabilities:       |                              |   |   |
| Accrued brokerage fees (MS&Co.)      | (318,585)                         |   | (572,334) |
| Accrued management fees                  | (106,195)                         |   | (190,778) |
| Accrued incentive fee                    | —                           |   | (2,289,365) |
|                                     |                              |   |   |
| Net cash used for operating activities   | (7,655,294)                       |   | (55,938,841) |
|                                     |                              |   |   |
| CASH FLOWS FROM FINANCING ACTIVITIES     |                              |   |   |
|                                     |                              |   |   |
| Cash paid for redemptions of Units       | (26,252,874)                      |   | (112,662,458) |
|                                     |                              |   |   |
| Net cash used for financing activities   | (26,252,874)                      |   | (112,662,458) |
|                                     |                              |   |   |
| Net decrease in unrestricted cash        | (33,908,168)                      |   | (168,601,299) |
|                                     |                              |   |   |
| Unrestricted cash at beginning of period | 371,818,291                       |   | 550,525,640 |
|                                     |                              |   |   |
| Unrestricted cash at end of period       | 337,910,123                       |   | 381,924,341 |

----

| Futures and Forward Contracts                                        | Long UnrealizedGain/(Loss)                                                                                       | Percentage ofNet Assets                                                                               | Short  UnrealizedGain/(Loss) |   | Percentage ofNet Assets |         |      Net Unrealized       Gain/(Loss) |
|----------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------|----------------------------------------|--------|-------------------------|--------------|---------------------------------------------------------------------------------------------------|
|                                                                 | $                                                                                                                | %                                                                                                     | $                                      |   | %                       |         |       $                                                             |
| June 30, 2010, Partnership Partners’ Capital: $349,102,849     |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
| Commodity                                                            | (2,390,363)                                                                                                      | (0.69)                                                                                                | 1,376,722                              |   | 0.39                    |         | (1,013,641)                                                                                       |
| Equity                                                               | (1,227,420)                                                                                                      | (0.35)                                                                                                | 123,596                                |   |  0.04              |         | (1,103,824)                                                                                       |
| Foreign currency                                                     |  (1,524,463)                                                                                                | (0.44)                                                                                                | (2,104,761)                            |   | (0.60)                  |         | (3,629,224)                                                                                       |
| Interest rate                                                        |           4,491,066                                                 |                  1.29 |     (636,444)      |   |   (0.18)      |         |     3,854,622                                                                 |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
| Grand Total:                                                         |                   (651,180) |   (0.19)                                                                                         |  (1,240,887)                      |   |  (0.35)            |         |      (1,892,067)                                                              |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
| Unrealized Currency Gain                                             |                                                                                                             |                                                                                                  |                                   |   |    0.02  |         |        84,770                                                  |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
| Total Net Unrealized Loss on Open Contracts                          |                                                                                                             |                                                                                                  |                                   |   |                    |         |  (1,807,297)                                                                                 |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
|                                                                 | Long UnrealizedGain/(Loss)                                                                                       | Percentage ofNet Assets                                                                               | Short  UnrealizedGain        |   | Percentage ofNet Assets |         |   Net Unrealized  Gain/(Loss)                                                 |
|                                                                 | $                                                                                                                | %                                                                                                     | $                                      |   | %                       |         | $                                                                                                 |
| December 31, 2009, Partnership Partners’ Capital: $399,908,477 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
| Commodity                                                            | 5,893,727                                                                                                        | 1.47                                                                                                  | 245,680                                |   | 0.06                    |         |   6,139,407                                                                                  |
| Equity                                                               | 786,962                                                                                                          | 0.20                                                                                                  | 18,522                                 |   |  0.01              |         |  805,484                                                                                     |
| Foreign currency                                                     | 616,300                                                                                                          | 0.15                                                                                                  | 438,549                                |   | 0.11                    |    |   1,054,849                                                                                  |
| Interest rate                                                        |                (2,169,237)            |  (0.54)                                                                                          |      130,659  |   |   0.03        |         |  (2,038,578)                                                                                 |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
|      Grand Total:                           |   5,127,752                                                                                            |    1.28                                                                                |     833,410        |   | 0.21                    |         |       5,961,162                                                          |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
|      Unrealized Currency Loss               |                                                                                                             |                                                                                                  |                                   |   | (0.01)                  |         |      (39,656)                                                                 |
|                                                                 |                                                                                                             |                                                                                                  |                                   |   |                    |         |                                                                                              |
| Total Net Unrealized Gain on Open Contracts                          |                                                                                                             |                                                                                                  |                                   |   |                    |         |   5,921,506                                                                                  |

----

----

----

----

----

| 1)   | a) One or more underlyings and b) notional amounts or payment provisions or both; |
|----------------|-----------------------------------------------------------------------------------|

| 2)   | Requires no initial net investment or a smaller initial net investment than would be required for other types of contracts that would be expected to have a similar response relative to changes in market factors; and |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Terms that require or permit net settlement. |
|----------------|----------------------------------------------|

----

|          | Net Unrealized Gains (Losses) on Open Contracts | Longest Maturities  |
|---------------|-------------------------------------------------|---------------------|
| Date          | Exchange-Traded                                 | Off-Exchange-Traded | Total | Exchange-Traded | Off-Exchange-Traded |
|          | $                                               | $                   | $ |   |   |
| Jun. 30, 2010 | 1,847,804                                       | (3,655,101)         | (1,807,297) | Sep. 2014 | Aug. 2010 |
| Dec. 31, 2009 | 4,878,451                                       | 1,043,055           | 5,921,506 | Jun. 2011 | Feb. 2010 |

----

----

----

| Futures and Forward Contracts               | Long UnrealizedGain | Long UnrealizedLoss                                |  ShortUnrealizedGain                                                                                                                                                                                           |   Short UnrealizedLoss                                                                                | Net   Unrealized Gain/(Loss)       | Average number of contractsoutstanding for six months (absolute quantity) |
|---------------------------------------------|---------------------|----------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------|--------------------------------------------------------|--------------------------------------------------------------------------------|
|                                        | $                   | $                                                  | $                                                                                                                                                                                                                   | $                                                                                                               | $                                                      |                                                                           |
|                                        |                |                                               |                                                                                                                                                                                                                |                                                                                                            |                                                   |                                                                           |
| Commodity                                   | 667,429             | (3,057,792)                                        | 2,095,154                                                                                                                                                                                                           | (718,432)                                           | (1,013,641)                                            | 5,530                                                                          |
| Equity                                      | –             | (1,227,420)                                        |                      164,582                                                                                    | (40,986)                                                                                                        | (1,103,824)                                            | 2,720                                                                          |
| Foreign currency                            | 610,748             | (2,135,211)                                        |                      427,874                                                                                    | (2,532,635)                                              | (3,629,224)                                            | 17,036                                                                         |
| Interest rate                               |  4,539,699     |        (48,633) |                            –        |                  (636,444) |     3,854,622                      |  8,124                                                                    |
| Total                                       |  5,817,876     | (6,469,056)                                        |   2,687,610                                                                                                                                                                                               |     (3,928,497)                           | (1,892,067)                                            |                                                                           |
|                                        |                |                                               |                                                                                                                                                                                                                |                                                                                                            |                                                   |                                                                           |
| Unrealized currency gain                    |                |                                               |                                                                                                                                                                                                                |                                                                                                            |         84,770 |                                                                           |
| Total net unrealized loss on open contracts |                |                                               |                                                                                                                                                                                                                |                                                                                                            |    (1,807,297)                          |                                                                           |

| Futures and Forward Contracts               | Long UnrealizedGain             | Long UnrealizedLoss |  ShortUnrealizedGain                                                                         |   Short UnrealizedLoss                                                                                                         | Net   Unrealized Gain/(Loss) | Average number of contractsoutstanding for the year (absolute quantity) |
|---------------------------------------------|---------------------------------|---------------------|---------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------|------------------------------------------------------------------------------|
|                                        | $                               | $                   | $                                                                                                 | $                                                                                                                                        | $                                                |                                                                         |
|                                        |                            |                |                                                                                              |                                                                                                                                     |                                             |                                                                         |
| Commodity                                   | 7,291,580                       | (1,397,853)         | 499,089                                                        |               (253,409)         | 6,139,407                                        | 4,941                                                                        |
| Equity                                      | 1,413,940                       | (626,978)           |                 18,522 | –                                                                                                                                  | 805,484                                          | 3,384                                                                        |
| Foreign currency                            | 1,718,378                       | (1,102,078)         |            1,070,003                            | (631,454)                                                                                        | 1,054,849                                        | 41,153                                                                       |
| Interest rate                               |     154,564 |  (2,323,801)   |               227,907            |               (97,248)                                                  |  (2,038,578)                                | 10,824                                                                       |
| Total                                       |  10,578,462                | (5,450,710)         |   1,815,521                                          |     (982,111)                                                                     | 5,961,162                                        |                                                                         |
|                                        |                            |                |                                                                                              |                                                                                                                                     |                                             |                                                                         |
| Unrealized currency loss                    |                            |                |                                                                                              |                                                                                                                                     |       (39,656)     |                                                                         |
| Total net unrealized gain on open contracts |                            |                |                                                                                              |                                                                                                                                     |     5,921,506                |                                                                         |

----

|                     |                                For the Three Months                                                                                                          |                                  For the Six Months                                     |
|--------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                     |                                 Ended June 30, 2010                                                                                                     |                                  Ended June 30, 2010                               |
| Type of Instrument       |                                             $                                               |                                          $ |
|                     |                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                               |
| Commodity                | (12,414,888)                                                                                                                                                                                                                                                                                                       | (19,961,444)                                                                                                                                                                                                                                       |
| Equity                   | (8,021,828)                                                                                                                                                                                                                                                                                                        | (17,902,249)                                                                                                                                                                                                                                       |
| Foreign currency         |                                                   (1,554,233) | (1,519,836)                                                                                                                                                                                                                                        |
| Interest rate            | 23,273,883                                                                                                                                                                                                                                                                                                         | 27,150,853                                                                                                                                                                                                                                         |
| Unrealized currency gain |         11,079                                                                                                                                                                                                                                                             |         124,426                                                                                                                                                                                            |
| Total                    |     1,294,013                                                                                                                                                                                                                                                                                  |    (12,108,250)                                                                                                                                                                                                                     |

|                     |                                       For the Three Months                              |                                    For the Six Months                                                              |
|--------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                     |                                    Ended June 30, 2010                                                 |                                    Ended June 30, 2010                                                             |
| Trading Results          |                                               $ |                                                 $ |
|                     |                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                         |
| Realized                 | 14,995,184                                                                                                                                                                                                                                                                       | (4,379,447)                                                                                                                                                                                                                                                                                  |
| Net change in unrealized |    (13,701,171)                                                                                                                                                                                                                                                   |    (7,728,803)                                                                                                                                                                                                                                                                |
| Total Trading Results    |         1,294,013                                                                                                                                                                                                                        |   (12,108,250)                                                                                                                                                                                                                                                                     |

|                     |                                      For the Three Months                                    |                             For the Six Months                                                   |
|--------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                     |                                         Ended June 30, 2009                   |                                 Ended June 30, 2009                               |
| Type of Instrument       |                                               $ |                                         $ |
|                     |                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                    |
| Commodity                | (6,881,506)                                                                                                                                                                                                                                                                      | (9,974,936)                                                                                                                                                                                                                             |
| Equity                   | (2,442,650)                                                                                                                                                                                                                                                                      | (1,257,892)                                                                                                                                                                                                                             |
| Foreign currency         | 6,567,970                                                                                                                                                                                                                                                                        | 3,208,480                                                                                                                                                                                                                               |
| Interest rate            | (6,226,029)                                                                                                                                                                                                                                                                      | (5,426,930)                                                                                                                                                                                                                             |
| Unrealized currency loss |     (313,192)                                                                                                                                                                                                                                                |       (886,930)                                                                                                                                                                                           |
| Total                    |   (9,295,407)                                                                                                                                                                                                                                                          |   (14,338,208)                                                                                                                                                                                                                |

----

|                     |                              For the Three Months                                                                                    |               For the Six Months                                            |
|--------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------|
|                     |                               Ended June 30, 2009                                                                               |                  Ended June 30, 2009                         |
| Trading Results          |                                               $ |                         $ |
|                     |                                                                                                                                                                                                                                                                             |                                                                                                                                         |
| Realized                 | (9,085,134)                                                                                                                                                                                                                                                                      | (10,321,138)                                                                                                                                 |
| Net change in unrealized |     (210,273)                                                                                                                                                                                                                                                |  (4,017,070)                                                                                                                            |
| Total Trading Results    |   (9,295,407)                                                                                                                                                                                                                                                          |   (14,338,208)                                                                                                                     |

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|                                     | UnadjustedQuoted Prices in Active Markets for Identical Assets(Level 1)           | Significant Other Observable Inputs(Level 2) | Significant Unobservable Inputs(Level 3) |   | Total                                                                                         |
|------------------------------------------|-----------------------------------------------------------------------------------|----------------------------------------------|------------------------------------------|--------|-----------------------------------------------------------------------------------------------|
|                                     | $                                                                                 | $                                            |                                     |   | $                                                                                             |
| Assets                                   |                                                                              |                                         |                                     |   |                                                                                          |
| Net unrealized gain on futures contracts | 1,847,804             | —                                      | n/a                                      |   |  1,847,804              |
| Net unrealized loss on forward contracts | —                                                                           | (3,655,101)                                  | n/a                                      |   | (3,655,101)                                                                                   |

|                                     | UnadjustedQuoted Prices in Active Markets for Identical Assets(Level 1)           | Significant Other Observable Inputs(Level 2) | Significant Unobservable Inputs(Level 3) |   | Total     |
|------------------------------------------|-----------------------------------------------------------------------------------|----------------------------------------------|------------------------------------------|--------|-----------|
|                                     | $                                                                                 | $                                            |                                     |   | $         |
| Assets                                   |                                                                              |                                         |                                     |   |      |
| Net unrealized gain on futures contracts | 4,878,451             | —                                      | n/a                                      |   | 4,878,451 |
| Net unrealized gain on forward contracts | —                                                                           | 1,043,055                                    | n/a                                      |   | 1,043,055 |

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| Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND |
|---------|-----------------------------------------------------------------------|

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|   | Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
|--------|-------------------------------------------------------------------------------|

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| Primary Market          | June 30, 2010                   | June 30, 2009 |
|-------------------------|---------------------------------|---------------|
| Risk Category           | Value at Risk                   | Value at Risk |
|                    |                            |          |
| Interest Rate           |     (0.84)% |  (0.32)% |
|                    |                            |          |
| Currency                | (0.32)                          | (1.03)        |
|                    |                            |          |
| Equity                  | (0.23)                          | (2.09)        |
|                    |                            |          |
| Commodity               | (0.70)                          | (1.00)        |
|                    |                            |          |
| Aggregate Value at Risk | (1.12)%                         | (3.46)%       |

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| June 30, 2010                |                      |                      |                      |
|------------------------------|---------------------------|---------------------------|---------------------------|
| Primary Market Risk Category | High                      | Low                       | Average                   |
| Interest Rate                |    (1.78)% |    (0.61)% |    (1.13)% |
| Currency                     | (1.77)                    | (0.32)                    | (1.09)                    |
| Equity                       | (6.04)                    | (0.23)                    | (3.09)                    |
| Commodity                    | (1.71)                    | (0.70)                    | (1.15)                    |
| Aggregate Value at Risk      | (7.50)%                   | (1.12)%                   | (4.24)%                   |

| June 30, 2009                |    |    |    |
|------------------------------|---------|---------|---------|
| Primary Market Risk Category | High    | Low     | Average |
| Interest Rate                | (0.67)% | (0.32)% | (0.42)% |
| Currency                     | (1.03)  | (0.07)  | (0.65)  |
| Equity                       | (2.09)  | (0.05)  | (0.84)  |
| Commodity                    | (1.00)  | (0.19)  | (0.61)  |
| Aggregate Value at Risk      | (3.46)% | (0.42)% | (1.52)% |

| ·   | past changes in market risk factors will not always result in accurate predictions of the distributions and correlations of future market movements; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | changes in portfolio value caused by market movements may differ from those of the VaR model; |
|--------------------|-----------------------------------------------------------------------------------------------|

| ·   | VaR results reflect past market fluctuations applied to current trading positions while future risk depends on future positions; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------|

| ·   | VaR using a one-day time horizon does not fully capture the market risk of positions that cannot be liquidated or hedged within one day; and |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the historical market risk factor data used for VaR estimation may provide only limited insight into losses that could be incurred under certain unusual market movements. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Item 1A. | RISK FACTORS |
|----------|--------------|

| Item 6. | EXHIBITS |
|---------|----------|

| 31.01 | Certification of President of Demeter Management LLC, the general partner of the Partnership, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.02 | Certification of Chief Financial Officer of Demeter Management LLC, the general partner of the Partnership, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.01 | Certification of President of Demeter Management LLC, the general partner of the Partnership, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.02 | Certification of Chief Financial Officer of Demeter Management LLC, the general partner of the Partnership, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|            | Morgan Stanley Smith Barney Charter Graham L.P. |
|-----------------|-------------------------------------------------|
|            | (Registrant)                                    |
|            |                                            |   |
|            | By:                                             | Demeter Management LLC |
|            |                                            | (General Partner) |
|            |                                            |   |
| August 12, 2010 | By:                                             | /s/Christian Angstadt |
|            |                                            | Christian Angstadt |
|            |                                            | Chief Financial Officer |