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

	FORM 10-Q


[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2007 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 0-25603

	MORGAN STANLEY CHARTER GRAHAM L.P.

	(Exact name of registrant as specified in its charter)


		Delaware						     13-4018068
(State or other jurisdiction of		   	 	  (I.R.S. Employer
incorporation or organization)			       Identification No.)

Demeter Management Corporation
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





(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, or a non-accelerated filer.  See definition
of ?accelerated filer and large accelerated filer? in Rule 12b-2 of the
Exchange Act.  (Check one):

Large accelerated filer___Accelerated filer____Non-accelerated filer X

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


	<page> <table> MORGAN STANLEY CHARTER GRAHAM L.P.

	INDEX TO QUARTERLY REPORT ON FORM 10-Q

	June 30, 2007


<caption>

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

				<c>
		Statements of Financial Condition as of June 30, 2007
 		(Unaudited) and December 31, 2006..........................2

		Statements of Operations for the Three and Six Months
		Ended June 30, 2007 and 2006 (Unaudited)...................3

		Statements of Changes in Partners? Capital for the
Six Months Ended June 30, 2007 and 2006 (Unaudited)........4

		Statements of Cash Flows for the Six Months Ended
		June 30, 2007 and 2006 (Unaudited).........................5

		Notes to Financial Statements (Unaudited)...............6-13

Item 2.	Management?s Discussion and Analysis of
			Financial Condition and Results of Operations.......14-29

Item 3.	Quantitative and Qualitative Disclosures about
			Market Risk.........................................29-42

Item 4.	Controls and Procedures.............................42-43

Item 4T.	Controls and Procedures................................43


PART II. OTHER INFORMATION

Item 1A.	Risk Factors...........................................44

Item 2.	Unregistered Sales of Equity Securities and
			Use of Proceeds.....................................44-45

Item 6.	Exhibits...............................................45

</table>


<page> <table> PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

	MORGAN STANLEY CHARTER GRAHAM L.P.
	STATEMENTS OF FINANCIAL CONDITION
<caption>
	June 30,	December 31,
	      2007       	      2006
	$	$
	(Unaudited)
ASSETS

	<c>	<c>
Equity in futures interests trading accounts:
	Unrestricted cash	412,219,343	362,441,363
	Restricted cash	    30,416,192	    54,560,197

	     Total cash	   442,635,535	  417,001,560

	Net unrealized gain on open contracts (MS&Co.)	10,565,905	     12,852,858
   	Net unrealized loss on open contracts (MSIL)	          (1,097,832)	       (314,794)

	     Total net unrealized gain on open contracts	       9,468,073	     12,538,064

	     Total Trading Equity	452,103,608	429,539,624

Subscriptions receivable	4,184,510	3,317,475
Interest receivable (MS&Co.)	        1,619,485	      1,824,393

	     Total Assets	    457,907,603	  434,681,492

LIABILITIES AND PARTNERS? CAPITAL

Liabilities

Redemptions payable	6,357,806	11,873,932
Accrued brokerage fees (MS&Co.)	2,122,851	2,123,827
Accrued management fees	           707,617	       707,942

	     Total Liabilities	        9,188,274	   14,705,701

Partners? Capital

Limited Partners (19,994,812.054 and
   21,346,676.377 Units, respectively)	443,841,741	415,478,418
General Partner (219,732.501 and
   231,068.501 Units, respectively)	       4,877,588	    4,497,373

         Total Partners? Capital	   448,719,329	 419,975,791
         Total Liabilities and Partners? Capital	   457,907,603	 434,681,492
NET ASSET VALUE PER UNIT	              22.20	            19.46
<fn>

	The accompanying notes are an integral part
	of these financial statements.
</table>


<page> <table> 	MORGAN STANLEY CHARTER GRAHAM L.P.
	STATEMENTS OF OPERATIONS
(Unaudited)

<caption>

                  For the Three Months	                             For the Six Months
  	        Ended June 30,     	                          Ended June 30,

                            2007   	         2006    	        2007   	    2006
                               $	             $	            $                      $

	<c>	<c>			<c>			<c>
INVESTMENT INCOME
	Interest income (MS&Co.)	    4,737,604		   4,925,743		   9,703,863	       9,092,539

EXPENSES
	Brokerage fees (MS&Co.)	5,834,078	6,550,474	11,888,204	12,837,350
	Management fees	    1,944,692	   2,183,491	    3,962,735	    4,279,117

		Total Expenses 	    7,778,770	   8,733,965		 15,850,939	 17,116,467

NET INVESTMENT LOSS 	   (3,041,166)	  (3,808,222)	  (6,147,076)	  (8,023,928)

TRADING RESULTS
Trading profit (loss):
	Realized	96,038,794	22,197,875	63,821,854	32,282,689
	Net change in unrealized	     5,478,350	   (9,882,841)		   (3,069,991)	   (1,365,642)

		Total Trading Results	 101,517,144	   12,315,034		   60,751,863	   30,917,047

NET INCOME	    98,475,978		      8,506,812	    54,604,787	   22,893,119

NET INCOME ALLOCATION

	Limited Partners	97,411,172		      8,413,749	54,015,536	22,643,146
	General Partner 	                               1,064,806	                     93,063	589,251	249,973


NET INCOME PER UNIT

	Limited Partners                                            	  4.79	   0.39 	 2.74                   	       1.03
	General Partner                                            	  4.79	   0.39 	 2.74                   	       1.03

<fn>







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

</table>
<page> <table> MORGAN STANLEY CHARTER GRAHAM L.P.
	STATEMENTS OF CHANGES IN PARTNERS? CAPITAL
	For the Six Months Ended June 30, 2007 and 2006
	(Unaudited)


<caption>


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


	<c>	<c>		<c>	<c>
Partners? Capital,
	December 31, 2005	22,656,744.737	416,811,790	4,509,689	421,321,479

Offering of Units	2,580,379.341          50,368,075	      ?     	50,368,075

Net Income                                                               ?	    	22,643,146	 249,973	22,893,119

Redemptions	 (3,099,813.050)	   (60,102,020)	         ?     	  (60,102,020)

Partners? Capital,
   June 30, 2006	 22,137,311.028	 429,720,991	  4,759,662	 434,480,653



Partners? Capital,
	December 31, 2006	21,577,744.878	415,478,418	4,497,373	419,975,791

Offering of Units	1,263,309.047          24,283,165	      ?     	24,283,165

Net Income                                                               ?	    	54,015,536	 589,251	54,604,787

Redemptions	 (2,626,509.370)	 (49,935,378)	 (209,036) 	  (50,144,414)

Partners? Capital,
   June 30, 2007	 20,214,544.555	 443,841,741	  4,877,588	 448,719,329




<fn>






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

</table>
<page>  <table>	MORGAN STANLEY CHARTER GRAHAM L.P.
	STATEMENTS OF CASH FLOWS
(Unaudited)

<caption>

	For the Six Months Ended June 30,

	  2007   	    2006
	$	$


CASH FLOWS FROM OPERATING ACTIVITIES

			<c>	<c>
Net income 	54,604,787	22,893,119
Noncash item included in net income:
	Net change in unrealized	3,069,991	1,365,642

(Increase) decrease in operating assets:
	Restricted cash	24,144,005	17,974,885
	Interest receivable (MS&Co.)	204,908	(319,270)

Decrease in operating liabilities:
	Accrued brokerage fees (MS&Co.)	(976)	(4,331)
	Accrued management fees	             (325)	           (1,443)

Net cash provided by operating activities	   82,022,390	   41,908,602


CASH FLOWS FROM FINANCING ACTIVITIES

Cash received from offering of Units	23,416,130	51,572,501
Cash paid for redemptions of Units 	   (55,660,540)	   (69,436,005)

Net cash used for financing activities	   (32,244,410)	   (17,863,504)

Net increase in unrestricted cash	49,777,980	24,045,098

Unrestricted cash at beginning of period	   362,441,363	   396,726,923

Unrestricted cash at end of period	                                                 412,219,343	   420,772,021



<fn>





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


</table>


<page> MORGAN STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS

June 30, 2007
(Unaudited)

The unaudited financial statements contained herein include, in
the opinion of management, all adjustments necessary for a fair
presentation of the results of operations and financial condition
of Morgan Stanley Charter Graham L.P. (the ?Partnership?).  The
financial statements and condensed notes herein should be read in
conjunction with the Partnership?s December 31, 2006, Annual
Report on Form 10-K.

1.  Organization
Morgan Stanley Charter Graham L.P. is a Delaware limited
partnership organized in 1998 to engage primarily in the
speculative trading of futures contracts, options on futures
contracts, and forward contracts on physical commodities and other
commodity interests, including, but not limited to, foreign
currencies, financial instruments, metals, energy, and
agricultural products. The Partnership is one of the Morgan
Stanley Charter Series of funds, comprised of the Partnership,
Morgan Stanley Charter WCM L.P., Morgan Stanley Charter Aspect
L.P., and Morgan Stanley Charter Campbell L.P. which effective as
of May 1, 2006, no longer accepts subscriptions and exchanges of
units of limited partnership interest (?Unit(s)?) from any other

<page> MORGAN  STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Charter Series of Funds for Units of Morgan Stanley Charter
Campbell L.P.

The Partnership?s general partner is Demeter Management
Corporation (?Demeter?). Morgan Stanley & Co. Incorporated
(?MS&Co.?) is the Partnership?s principal commodity broker-dealer
and also acts as the counterparty on all trading of foreign
currency forward contracts.  In addition, Morgan Stanley & Co.
International plc (?MSIL?) serves as the commodity broker for
trades on the London Metal Exchange.  Effective April 13, 2007,
Morgan Stanley & Co. International Limited changed its name to
Morgan Stanley & Co. International plc.  Demeter, MS&Co., and MSIL
are wholly-owned subsidiaries of Morgan Stanley. Graham Capital
Management, L.P. (the ?Trading Advisor?) is the trading advisor to
the Partnership.

2.  Related Party Transactions
The Partnership?s cash is on deposit with MS&Co. and MSIL in
futures, forward, and options trading accounts to meet margin
requirements as needed.  MS&Co. pays the Partnership at each
month end interest income on an amount equal to the commodity
brokers? margin requirements on the Partnership?s current futures,
forward, and options contracts at a rate approximately equivalent

<page> MORGAN  STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

to the rate the commodity brokers pay other similar customers on
margin deposits.  In addition, MS&Co. pays the Partnership at each
month end interest income on the Partnership?s funds in excess of
such current margin requirements but available to satisfy margin
requirements at a rate equal to the monthly average of the
4-week U.S. Treasury bill discount rate during the month.  The
Partnership pays brokerage fees to MS&Co.



3.  Financial Instruments
The Partnership trades futures contracts, options on futures
contracts, and forward contracts on physical commodities and
other commodity interests, including, but not limited to,
foreign currencies, financial instruments, metals, energy, and
agricultural products.  Futures and forwards represent contracts
for delayed delivery of an instrument at a specified date and
price.  Risk arises from changes in the value of these contracts
and the potential inability of counterparties to perform under the
terms of the contracts.  There are numerous factors which may
significantly influence the market value of these contracts,
including interest rate volatility.

The market value of exchange-traded contracts is based on the
settlement price quoted by the exchange on the day with respect

<page> MORGAN  STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

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


The Partnership?s contracts are accounted for on a trade-date
basis and marked to market on a daily basis.  The Partnership
accounts for its derivative investments in accordance with the
provisions of Statement of Financial Accounting Standards No. 133,
?Accounting for Derivative Instruments and Hedging Activities?
(?SFAS No. 133?).  SFAS No. 133 defines a derivative as a
financial instrument or other contract that has all three of the
following characteristics:


1)	One or more underlying notional amounts or payment
provisions;
2)	Requires no initial net investment or a smaller initial net
investment than would be required relative to changes in
market factors;
3)	Terms require or permit net settlement.

<page> MORGAN  STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Generally, derivatives include futures, forward, swap or options
contracts, and other financial instruments with similar
characteristics such as caps, floors, and collars.

The net unrealized gains on open contracts, reported as a
component of ?Equity in futures interests trading accounts? on the
Statements of Financial Condition, and their longest contract
maturities were as follows:
                           Net Unrealized Gains
	               on Open Contracts	Longest Maturities

	Exchange-	Off-Exchange-		 Exchange-	Off-Exchange-
Date	 Traded  	   Traded    	 Total	   Traded  	   Traded
	$	$	 $

Jun. 30, 2007   3,166,379	6,301,694	 9,468,073	Dec. 2008	 Sep. 2007
Dec. 31, 2006   5,466,119	7,071,945	12,538,064	Jun. 2008	 Mar. 2007

The Partnership has credit risk associated with counterparty non-
performance.  As of the date of the financial statements, the
credit risk associated with the instruments in which the
Partnership trades is limited to the amounts reflected in the
Partnership?s Statements of Financial Condition.

The Partnership also has credit risk because MS&Co. and MSIL act
as the futures commission merchants or the counterparties, with
respect to most of the Partnership?s assets.  Exchange-traded
futures, exchange-traded forward, and exchange-traded futures-

<page> MORGAN  STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

styled options contracts are marked to market on a daily basis,
with variations in value settled on a daily basis.  MS&Co. and
MSIL, each as a futures commission merchant for the Partnership?s
exchange-traded futures, exchange-traded forward, and exchange-
traded futures-styled options contracts, are required, pursuant to
regulations of the Commodity Futures Trading Commission (?CFTC?),
to segregate from their own assets, and for the sole benefit of
their commodity customers, all funds held by them with respect to
exchange-traded futures, exchange-traded forward, and exchange-
traded futures-styled options contracts, including an amount equal
to the net unrealized gains (losses) on all open exchange-traded
futures, exchange-traded forward, and exchange-traded futures-
styled options contracts, which funds, in the aggregate, totaled
$445,801,914 and $422,467,679 at June 30, 2007, and December 31,
2006, respectively.  With respect to the Partnership?s off-
exchange-traded forward currency contracts, there are no daily
settlements of variation in value, nor is there any requirement
that an amount equal to the net unrealized gains (losses) on such
contracts be segregated.  However, the Partnership is required to
meet margin requirements equal to the net unrealized loss on open
forward currency contracts in the Partnership accounts with the
counterparty, which is accomplished by daily maintenance of the
cash balance in a custody account held at MS&Co.  With respect to

<page> MORGAN  STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

those off-exchange-traded forward currency contracts, the
Partnership is at risk to the ability of MS&Co., the sole
counterparty on all such contracts, to perform. The Partnership
has a netting agreement with MS&Co.  This agreement, which seeks
to reduce both the Partnership?s and MS&Co.?s exposure on off-
exchange-traded forward currency contracts, should materially
decrease the Partnership?s credit risk in the event of MS&Co.?s
bankruptcy or insolvency.

4.  New Accounting Developments
In July 2006, the Financial Accounting Standards Board (?FASB?)
issued interpretation No. 48, ?Accounting for Uncertainty in
Income Taxes ? an interpretation of FASB Statement 109? (?FIN
48?).  FIN 48 clarifies the accounting for income taxes by
prescribing the minimum recognition threshold a tax position must
meet before being recognized in the financial statements.  FIN 48
was effective for the Partnership as of January 1, 2007.  Based
on its analysis, management believes that the adoption of FIN 48
has no impact on the Partnership?s Financial Statements.

In September 2006, the FASB issued SFAS No. 157, ?Fair Value
Measurements? (?SFAS No. 157?).  SFAS No. 157 defines fair value,
establishes a framework for measuring fair value, and expands

<page> MORGAN  STANLEY CHARTER GRAHAM L.P.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)

disclosures about fair value measurements.  SFAS No. 157 is
effective for the Partnership as of January 1, 2008.  The impact
to the Partnership?s Financial Statements, if any, is currently
being assessed.




<page>
Item 2.  MANAGEMENT?S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

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

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

There is no limitation on daily price moves in trading forward
contracts on foreign currencies.  The markets for some world
currencies have low trading volume and are illiquid, which may
prevent the Partnership from trading in potentially profitable
markets or prevent the Partnership from promptly liquidating
unfavorable positions in such markets, subjecting it to
substantial losses.  Either of these market conditions could
result in restrictions on redemptions.  For the periods covered by
this report, illiquidity has not materially affected the
Partnership?s assets.

There are no known material trends, demands, commitments, events,
or uncertainties at the present time that are reasonably likely to
result in the Partnership?s liquidity increasing or decreasing in
any material way.

Capital Resources.  The Partnership does not have, nor does it
expect to have, any capital assets.  Redemptions, exchanges, and
sales of Units in the future will affect the amount of funds
available for investments in futures, forwards, and options in
subsequent periods.  It is not possible to estimate the amount,
and therefore the impact, of future inflows and outflows of Units.
<page> There are no known material trends, favorable or
unfavorable, that would affect, nor any expected material changes
to, the Partnership?s capital resource arrangements at the present
time.

Off-Balance Sheet Arrangements and Contractual Obligations.  The
Partnership does not have any off-balance sheet arrangements, nor
does it have contractual obligations or commercial commitments to
make future payments that would affect its liquidity or capital
resources.

Results of Operations
General.  The Partnership?s results depend on the Trading Advisor
and the ability of the Trading Advisor?s trading programs to take
advantage of price movements in the futures, forward, and options
markets.  The following presents a summary of the Partnership?s
operations for the three and six month periods ended June 30,
2007, and 2006, and a general discussion of its trading activities
during each period.  It is important to note, however, that the
Trading Advisor trades in various markets at different times and
that prior activity in a particular market does not mean that such
market will be actively traded by the Trading Advisor or will be
profitable in the future. Consequently, the results of operations
of the Partnership are difficult to discuss other than in the
context of the Trading Advisor?s trading activities on behalf of
<page> the Partnership during the period in question.  Past
performance is no guarantee of future results.

The Partnership?s results of operations set forth in the
Financial Statements on pages 2 through 13 of this report are
prepared in accordance with accounting principles generally
accepted in the United States of America, which require the use
of certain accounting policies that affect the amounts reported
in these financial statements, including the following:  The
contracts the Partnership trades are accounted for on a trade-
date basis and marked to market on a daily basis.  The difference
between their cost and market value is recorded on the Statements
of Operations as ?Net change in unrealized trading profit (loss)?
for open (unrealized) contracts, and recorded as ?Realized
trading profit (loss)? when open positions are closed out.  The
sum of these amounts constitutes the Partnership?s trading
results.  The market value of a futures contract is the
settlement price on the exchange on which that futures contract
is traded on a particular day.  The value of a foreign currency
forward contract is based on the spot rate as of the close of
business.  Interest income, as well as management fees, incentive
fees, and brokerage fees expenses of the Partnership are recorded
on an accrual basis.

<page> Demeter believes that, based on the nature of the
operations of the Partnership, no assumptions relating to the
application of critical accounting policies other than those
presently used could reasonably affect reported amounts.

For the Three and Six Months Ended June 30, 2007
The Partnership recorded total trading results including interest
income totaling $106,254,748 and expenses totaling $7,778,770,
resulting in net income of $98,475,978 for the three months ended
June 30, 2007. The Partnership?s net asset value per Unit
increased from $17.41 at March 31, 2007, to $22.20 at June 30,
2007.

The most significant trading gains of approximately 14.6% were
recorded in the global interest rate sector from short positions
in European fixed-income futures as prices moved lower throughout
the quarter amid continued optimism about the status of the
European economy after real Gross Domestic Product in the Euro-
Zone increased more than expected during the first quarter of
2007.  Additionally, European interest rate futures prices were
pressured lower on news that Germany's unemployment rate held at
a six-year low, French unemployment dropped to the lowest level
in 24 years, and housing prices in the United Kingdom showed
their biggest jump this year.  Elsewhere, gains were experienced
primarily during May and June from short positions in U.S.
interest rate futures as prices declined after the Conference
<page> Board's index of leading economic indicators showed that
five of the ten categories for the U.S. economy showed
improvement.  Additional gains of approximately 8.7% were
experienced in the currency sector throughout the quarter from
long positions in the New Zealand dollar, Turkish lira, Canadian
dollar, Brazilian real, and Australian dollar versus the U.S.
dollar as the value of the U.S. dollar weakened relative to these
currencies on news that foreign investment in U.S. securities
fell more than expected in February and the U.S. industrial
production declined in March.  In addition, the value of the U.S.
dollar continued to fall against its major rivals leading up to
and after the U.S. Federal Reserve?s decision to leave interest
rates steady at 5.25%.  Elsewhere, short positions in the
Japanese yen versus the U.S. dollar resulted in gains throughout
the quarter as the value of the Japanese yen weakened relative to
most of its major rivals in a continuation of the carry-trade
after news that the Tankan survey was weaker than expected and a
decline in Japanese industrial production increased speculation
that Japanese economic growth was not sufficient to warrant an
increase in interest rates by the Bank of Japan.  Smaller gains
of approximately 3.8% were recorded in the global stock index
sector primarily during April and May from long positions in
European and U.S. equity index futures as prices moved higher
amid consistently strong corporate earnings and increased merger
and acquisition activity.  Elsewhere, long positions in Pacific
Rim equity index futures resulted in gains primarily during May
<page> as prices increased on optimism that strong economic
growth in the Euro-Zone and the U.S. would result in strong
demand for exports from Asia.  A portion of the Partnership?s
gains in the second quarter was offset by losses of approximately
0.3% in the metals markets primarily during May from long
positions in copper, aluminum, and zinc futures as prices fell
after the Chinese government announced that it would raise export
taxes for base metals and on speculation that rising production
and inventories might create a global surplus.  Additional losses
were recorded during May from long positions in gold futures as
prices fell due to speculative selling.  Finally, losses of
approximately 0.3% were experienced in the agricultural markets
throughout the quarter from long positions in soybean meal
futures as prices moved lower on news of an increase in supplies.
 During May and June, additional losses were incurred as wet
weather conditions pressured prices lower amid speculation that
rain might positively impact future supplies.  Elsewhere, losses
were recorded from long positions in cocoa futures primarily
during April as prices were pressured lower on news that
political tensions in the Ivory Coast were subsiding, alleviating
fears that future supplies would be negatively impacted.

The Partnership recorded total trading results including interest
income totaling $70,455,726 and expenses totaling $15,850,939,
resulting in net income of $54,604,787 for the six months ended
June 30, 2007.  The Partnership?s net asset value per Unit <page>
increased from $19.46 at December 31, 2006, to $22.20 at June 30,
2007.

The most significant trading gains of approximately 11.3% were
recorded in the global interest rate sector throughout a majority
of the year from short positions in European fixed-income futures
as prices initially fell during January after reports showed
confidence in the Euro-Zone economy stayed close to a six-year
high in December.  European fixed-income futures prices continued
to weaken after the Ifo Institute stated that German business
sentiment climbed to the second-highest level on record in April
and consumer confidence in the United Kingdom increased in April.
During May and June, European interest rate futures prices fell
after a report showing real Gross Domestic Product in the Euro-
Zone had increased more than expected in the first quarter of
2007 and news that Germany's seasonally adjusted unemployment
rate had reached its lowest level since 1995 and housing prices
in the United Kingdom had shown their biggest jump in 2007.
Elsewhere, short positions in U.S. interest rate futures resulted
in gains as prices moved lower during January after stronger than
expected retail sales data, consumer confidence, and jobs growth
suggested that the U.S. Federal Reserve might not cut interest
rates during the first quarter of 2007.  During May and June,
U.S. fixed-income futures prices fell after the Philadelphia
Federal Reserve's index of regional manufacturing increased more
than expected in April, the Federal Reserve Bank of Richmond
<page> President Jeffrey Lacker stated there were still
inflationary concerns present in the U.S. economy, and the
Conference Board's index of leading economic indicators showed
that five of the ten categories for the U.S. economy showed
improvement.  Additional gains of approximately 5.3% were
experienced in the currency sector primarily during the second
quarter from short positions in the Japanese yen versus the U.S.
dollar, euro, and Australian dollar as the value of the Japanese
yen weakened against most of its major rivals in a continuation
of the carry-trade after news that the Tankan survey was weaker
than expected and a decline in Japanese industrial production
increased speculation that Japanese economic growth was not
sufficient to warrant an increase in interest rates by the Bank
of Japan.  Elsewhere, gains were recorded throughout the year
from long positions in the Turkish lira, Brazilian real, Canadian
dollar, and New Zealand dollar versus the U.S. dollar as these
currencies moved higher relative to the U.S. dollar after strong
economic data out of these countries added to growing investor
sentiment that their respective Central Banks would raise
interest rates in order to combat inflation.  Additionally, the
value of the U.S. dollar declined against these currencies after
the U.S. Federal Reserve?s decision to leave interest rates
steady at 5.25%.  Smaller gains of approximately 1.9% were
recorded in the global stock index sector primarily during
January, April, and May from long positions in European equity
index futures as prices climbed higher on strong corporate <page>
earnings and increased merger and acquisition activity in the
Euro-Zone, as well as continued optimism about the future of the
global economy.  A portion of the Partnership?s gains in the
first six months of the year was offset by losses of
approximately 1.5% recorded in the energy markets primarily
during January and March from short positions in natural gas
futures as prices moved higher during March after the U.S.
Department of Energy reported that natural gas supplies were down
15% from a year ago.  Elsewhere, short futures positions in crude
oil and its related products resulted in losses primarily during
the first quarter as prices reversed higher on increased concerns
that unexpected refinery shutdowns would curb fuel stockpiles in
the future.  Prices continued to move higher amid rising
geopolitical concerns in the Middle East. Additional losses of
approximately 1.1% were experienced in the metals markets
primarily during February and March from short positions in zinc
futures as prices moved higher on continued speculation that low
stockpiles and supply disruptions might create a supply shortage
in the future.  Meanwhile, losses were incurred primarily during
January, February, and May from both short and long positions in
copper, aluminum, and zinc futures as prices moved in a trendless
pattern.  Finally, losses of approximately 0.3% were incurred in
the agricultural markets primarily during January and May from
both short and long positions in coffee futures as prices moved
without consistent direction due to conflicting data regarding
supply and demand.  Elsewhere, long positions in corn futures
<page> resulted in losses primarily during March and April as
prices dropped after the U.S. government announced its plans to
seek alternative fuel sources other than ethanol.

For the Three and Six Months Ended June 30, 2006
The Partnership recorded total trading results including interest
income totaling $17,240,777 and expenses totaling $8,733,965,
resulting in net income of $8,506,812 for the three months ended
June 30, 2006. The Partnership?s net asset value per Unit
increased from $19.24 at March 31, 2006, to $19.63 at June 30,
2006.

The most significant trading gains of approximately 5.7% were
recorded in the global interest rate futures markets from short
positions in German, British, U.S., and Japanese fixed-income
futures.  Within European markets, rising equity prices and
strong economic growth increased speculation that the European
Central Bank would accelerate its interest-rate tightening
campaign, thus pushing prices for German and British debt futures
lower.  Similarly, U.S. interest rate futures prices moved lower
following the release of stronger than expected economic data.
Elsewhere in the global interest rate futures markets, short
positions in Japanese fixed-income futures experienced gains as
prices dropped amid growing speculation that the Bank of Japan
would end its ?ultra-easy? monetary policy and begin to increase
interest rates.  Within the metals markets, a gain of <page>
approximately 2.6% was recorded throughout the quarter from long
positions in copper, nickel, and aluminum futures, as well as
long positions in the precious metals, such as gold.  Base metals
prices rallied sharply to record highs amid an increase in
industrial demand from strong global economic growth and limited
production ability.  Gold prices rallied to 26-year highs,
boosted by continued geopolitical concerns regarding Iran?s
nuclear program, inflation concerns due to high oil prices, and
strong global economic growth.  A portion of these gains was
offset by losses of approximately 2.8% within the currency
markets during April from long positions in the U.S. dollar, as
the value of the U.S. dollar declined against the Australian
dollar, Swiss franc, and euro.  This reversal in the value of the
U.S. dollar was attributed to news that foreign central banks
would diversify their currency reserves away from the U.S.
dollar.  The U.S. dollar also weakened on worries regarding the
U.S. trade deficit and speculation that the U.S. Federal Reserve
might be near the end of its cycle in interest rate increases.
During June, long positions in the euro versus the U.S. dollar
recorded losses as the U.S. dollar reversed higher against most
of its rivals due to diplomatic developments made between the
U.S. and Iran regarding Iran?s nuclear research program, as well
as the news of the confirmed death of insurgent leader Abu Musab
al-Zarqawi in Iraq. Furthermore, the value of the U.S. dollar
continued to move higher in the days leading up to the U.S.
Federal Reserve?s 17th consecutive rate hike on June 29.  <page>
Additional losses of approximately 2.3% were incurred in the
global equity indices markets during May from long positions in
U.S., European, and Japanese stock index futures as equity prices
closed lower during the month.  U.S. and European stock indices
incurred losses as prices declined due to inflation concerns and
uncertainty regarding future interest rate policy.  Meanwhile,
Japanese equity markets suffered from a heavy sell-off as
investors expressed concerns that the Japanese economy, which is
heavily dependent on exports, could be significantly impacted by
a global economic slowdown.  Further losses were incurred during
June from short positions in Japanese stock index futures as
prices reversed higher due to solid economic data and strong
investor sentiment for the region.  Smaller losses of
approximately 1.0% were incurred in the agricultural markets
during May from short positions in corn futures as prices settled
higher on technically-based buying.  Long positions in wheat
futures also experienced losses as prices moved lower during the
first half of June on favorable weather forecasts across the U.S.
wheat belt and reports from the U.S. Department of Agriculture
showing improved crop conditions.  Elsewhere in the agricultural
complex, losses were incurred from short positions in soybean
meal futures as prices ended higher in June after the prospect of
hotter and drier weather was viewed as an increasing threat to
inventories.

<page> The Partnership recorded total trading results including
interest income totaling $40,009,586 and expenses totaling
$17,116,467, resulting in net income of $22,893,119 for the six
months ended June 30, 2006.  The Partnership?s net asset value
per Unit increased from $18.60 at December 31, 2005, to $19.63 at
June 30, 2006.

The most significant trading gains of approximately 8.5% were
recorded in the global interest rate sector from short positions
in German, British, and U.S. fixed-income futures.  Within
European markets, rising equity prices and strong economic growth
increased speculation that the European Central Bank would
accelerate its interest-rate tightening campaign, thus pushing
prices for German and British fixed-income futures prices lower
during April.  Similarly, U.S. interest rate futures moved lower
following the release of stronger than expected economic data.
Additional gains of approximately 2.9% were experienced in the
metals markets throughout a majority of the year from long
copper, nickel, and aluminum futures positions, as well as long
positions in precious metals, such as gold.  Base metals prices
rallied sharply to record highs amid an increase in industrial
demand from strong global economic growth and limited production
ability.  Gold prices rallied to 26-year highs, boosted by
continued geopolitical concerns regarding Iran?s nuclear program
and inflation concerns due to high oil prices.  Within the global
stock index futures markets, gains of approximately 2.9% were
<page> recorded from long positions in European stock index
futures as prices trended higher during the first quarter on
strong corporate earnings and solid economic data out of the
European Union, Australia, Japan, and the United States.  A
portion of these gains for the first six months of the year was
offset by losses of approximately 5.8% in the currency markets
from long U.S. dollar positions versus the Swiss franc, euro, and
New Zealand dollar as the U.S. dollar?s value reversed lower
against these currencies.  This reversal in the value of the U.S.
dollar was attributed to news that foreign central banks would
diversify their currency reserves away from the U.S. dollar.  The
U.S. dollar also weakened on worries regarding the U.S. trade
deficit and speculation that the U.S. Federal Reserve might be
near the end of its cycle in interest rate increases.  During
June, long positions in the euro versus the U.S. dollar recorded
losses as the U.S. dollar reversed higher against most of its
rivals due to diplomatic developments made between the U.S. and
Iran regarding Iran?s nuclear research program, as well as the
news of the confirmed death of insurgent leader Abu Musab al-
Zarqawi in Iraq. Furthermore, the value of the U.S. dollar
continued to move higher in the days leading up to the U.S.
Federal Reserve?s 17th consecutive rate hike on June 29.  Within
the agricultural markets, losses of approximately 1.6% were
recorded from long positions in wheat futures as prices fell on
forecasts for above-average rainfall in the U.S. growing regions.
 Additional losses in the agricultural complex were incurred from
<page> short positions in soybean meal futures as prices ended
higher in June on technically-based buying.  Finally, smaller
losses were incurred from short positions in corn futures as
prices moved higher on news of strong demand and bullish export
data.  Smaller losses of approximately 0.4% were experienced in
the energy markets during the first quarter from long futures
positions in crude oil and its related products as prices
declined after the announcement by Chinese government authorities
that China would place an emphasis on prospecting alternative
energy sources in the future, reports of larger than expected
supplies from the International Energy Agency, and mild weather
in the U.S. Northeast.

Item 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Introduction
The Partnership is a commodity pool engaged primarily in the
speculative trading of futures, forwards, and options.  The
market-sensitive instruments held by the Partnership are acquired
for speculative trading purposes only and, as a result, all or
substantially all of the Partnership?s assets are at risk of
trading loss.  Unlike an operating company, the risk of market-
sensitive instruments is inherent to the primary business
activity of the Partnership.

The futures, forwards, and options traded by the Partnership
involve varying degrees of related market risk.  Market risk is
<page> often dependent upon changes in the level or volatility of
interest rates, exchange rates, and prices of financial
instruments and commodities, factors that result in frequent
changes in the fair value of the Partnership?s open positions,
and consequently in its earnings, whether realized or unrealized,
and cash flow.  Gains and losses on open positions of exchange-
traded futures, exchange-traded forward, and exchange-traded
futures-styled options contracts are settled daily through
variation margin. Gains and losses on off-exchange-traded forward
currency contracts are settled upon termination of the contract.
However, the Partnership is required to meet margin requirements
equal to the net unrealized loss on open forward currency
contracts in the Partnership accounts with the counterparty,
which is accomplished by daily maintenance of the cash balance in
a custody account held at MS&Co.

The Partnership?s total market risk may increase or decrease as
it is influenced by a wide variety of factors, including, but not
limited to, the diversification among the Partnership?s open
positions, the volatility present within the markets, and the
liquidity of the markets.

The face value of the market sector instruments held by the
Partnership is typically many times the applicable margin
requirements.  Margin requirements generally range between 2% and
15% of contract face value.  Additionally, the use of leverage
<page> causes the face value of the market sector instruments
held by the Partnership typically to be many times the total
capitalization of the Partnership.

The Partnership?s past performance is no guarantee of its future
results.  Any attempt to numerically quantify the Partnership?s
market risk is limited by the uncertainty of its speculative
trading.  The Partnership?s speculative trading and use of
leverage may cause future losses and volatility (i.e., ?risk of
ruin?) that far exceed the Partnership?s experience to date under
the ?Partnership?s Value at Risk in Different Market Sectors?
section and significantly exceed the Value at Risk (?VaR?) tables
disclosed.

Limited partners will not be liable for losses exceeding the
current net asset value of their investment.

Quantifying the Partnership?s Trading Value at Risk
The following quantitative disclosures regarding the Partnership?s
market risk exposures contain ?forward-looking statements? within
the meaning of the safe harbor from civil liability provided for
such statements by the Private Securities Litigation Reform Act of
1995 (set forth in Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934).  All
quantitative disclosures in this section are deemed to be forward-
<page> looking statements for purposes of the safe harbor, except
for statements of historical fact.

The Partnership accounts for open positions on the basis of mark
to market accounting principles.  Any loss in the market value of
the Partnership?s open positions is directly reflected in the
Partnership?s earnings and cash flow.

The Partnership?s risk exposure in the market sectors traded by
the Trading Advisor is estimated below in terms of VaR.  The
Partnership estimates VaR using a model based upon historical
simulation (with a confidence level of 99%) which involves
constructing a distribution of hypothetical daily changes in the
value of a trading portfolio.  The VaR model takes into account
linear exposures to risks including equity and commodity prices,
interest rates, foreign exchange rates, and correlation among
these variables. The hypothetical changes in portfolio value are
based on daily percentage changes observed in key market indices
or other market factors (?market risk factors?) to which the
portfolio is sensitive.  The one-day 99% confidence level of the
Partnership?s VaR corresponds to the negative change in portfolio
value that, based on observed market risk factors, would have
been exceeded once in 100 trading days, or one day in 100.  VaR
typically does not represent the worst case outcome.  Demeter
<page> uses approximately four years of daily market data (1,000
observations) and re-values its portfolio (using delta-gamma
approximations) for each of the historical market moves that
occurred over this time period.  This generates a probability
distribution of daily ?simulated profit and loss? outcomes.  The
VaR is the appropriate percentile of this distribution.  For
example, the 99% one-day VaR would represent the 10th worst
outcome from Demeter?s simulated profit and loss series.

The Partnership?s VaR computations are based on the risk
representation of the underlying benchmark for each instrument or
contract and do not distinguish between exchange and non-exchange
dealer-based instruments.  They are also not based on exchange
and/or dealer-based maintenance margin requirements.

VaR models, including the Partnership?s, are continually evolving
as trading portfolios become more diverse and modeling techniques
and systems capabilities improve.  Please note that the VaR model
is used to numerically quantify market risk for historic
reporting purposes only and is not utilized by either Demeter or
the Trading Advisor in their daily risk management activities.
Please further note that VaR as described above may not be
comparable to similarly-titled measures used by other entities.



<page>
The Partnership?s Value at Risk in Different Market Sectors
The following table indicates the VaR associated with the
Partnership?s open positions as a percentage of total Net Assets
by primary market risk category at June 30, 2007 and 2006.  At
June 30, 2007 and 2006, the Partnership?s total capitalization
was approximately $449 million and $434 million, respectively.

Primary Market	June 30, 2007	June 30, 2006
Risk Category	 Value at Risk 	 Value at Risk

Interest Rate	(1.20)%	(0.69)%
Currency	(1.09)	(0.37)
Equity	(1.06)	(0.13)
Commodity 	(0.20)	(0.27)
Aggregate Value at Risk	        (2.21)%	(0.75)%

The VaR for a market category represents the one-day downside risk
for the aggregate exposures associated with this market category.
The Aggregate Value at Risk listed above represents the VaR of the
Partnership?s open positions across all the market categories, and
is less than the sum of the VaRs for all such market categories
due to the diversification benefit across asset classes.

Because the business of the Partnership is the speculative
trading of futures, forwards, and options, the composition of its
trading portfolio can change significantly over any given time
period, or even within a single trading day.  Such changes could
<page> positively or negatively materially impact market risk as
measured by VaR.

The table below supplements the quarter-end VaR set forth above
by presenting the Partnership?s high, low, and average VaR, as a
percentage of total Net Assets for the four quarter-end reporting
periods from July 1, 2006, through June 30, 2007.

Primary Market Risk Category	High	Low	Average
Interest Rate	(1.31)%	(0.82)%	(1.11)%

Currency 	(2.61)	(0.54)	(1.40)

Equity	(3.14)	(0.15)	(1.72)

Commodity	(0.33)	(0.20)	(0.27)

Aggregate Value at Risk	(4.19)%	(1.38)%	(2.57)%



Limitations on Value at Risk as an Assessment of Market Risk
VaR models permit estimation of a portfolio?s aggregate market
risk exposure, incorporating a range of varied market risks,
reflect risk reduction due to portfolio diversification or hedging
activities, and can cover a wide range of portfolio assets.
However, VaR risk measures should be viewed in light of the
methodology?s limitations, which include, but may not be limited
to the following:
*	past changes in market risk factors will not always result in
accurate predictions of the distributions and correlations of
future market movements;

<page>
*	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.

In addition, the VaR tables above, as well as the past performance
of the Partnership, give no indication of the Partnership?s
potential ?risk of ruin?.

The VaR tables provided present the results of the Partnership?s
VaR for each of the Partnership?s market risk exposures and on an
aggregate basis at June 30, 2006, and for the four quarter-end
reporting periods from July 1, 2006, through June 30, 2007.  VaR
is not necessarily representative of the Partnership?s historic
risk, nor should it be used to predict the Partnership?s future
financial performance or its ability to manage or monitor risk.
There can be no assurance that the Partnership?s actual losses on
a particular day will not exceed the VaR amounts indicated above
<page> or that such losses will not occur more than once in 100
trading days.

Non-Trading Risk
The Partnership has non-trading market risk on its foreign cash
balances.  These balances and any market risk they may represent
are immaterial.

The Partnership also maintains a substantial portion of its
available assets in cash at MS&Co.; as of June 30, 2007, such
amount is equal to approximately 93% of the Partnership?s net
asset value.  A decline in short-term interest rates would result
in a decline in the Partnership?s cash management income. This
cash flow risk is not considered to be material.

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

Qualitative Disclosures Regarding Primary Trading Risk Exposures
The following qualitative disclosures regarding the Partnership?s
market risk exposures - except for (A) those disclosures that are
statements of historical fact and (B) the descriptions of how the
<page> Partnership manages its primary market risk exposures -
constitute forward-looking statements within the meaning of
Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act. The Partnership?s primary market risk
exposures, as well as the strategies used and to be used by
Demeter and the Trading Advisor for managing such exposures, are
subject to numerous uncertainties, contingencies and risks, any
one of which could cause the actual results of the Partnership?s
risk controls to differ materially from the objectives of such
strategies. Government interventions, defaults and expropriations,
illiquid markets, the emergence of dominant fundamental factors,
political upheavals, changes in historical price relationships, an
influx of new market participants, increased regulation, and many
other factors could result in material losses, as well as in
material changes to the risk exposures and the risk management
strategies of the Partnership. Investors must be prepared to lose
all or substantially all of their investment in the Partnership.

The following were the primary trading risk exposures of the
Partnership at June 30, 2007, by market sector.  It may be
anticipated, however, that these market exposures will vary
materially over time.

Interest Rate. The largest market exposure of the Partnership at
June 30, 2007, was to the global interest rate sector.  Exposure
was primarily spread across the U.S., European, Japanese, and
<page> Australian interest rate sectors.  Interest rate movements
directly affect the price of the sovereign bond futures positions
held by the Partnership and indirectly affect the value of its
stock index and currency positions.  Interest rate movements in
one country, as well as relative interest rate movements between
countries, materially impact the Partnership?s profitability. The
Partnership?s interest rate exposure is generally to interest
rate fluctuations in the U.S. and the other G-7 countries.  The
G-7 countries consist of France, the U.S., Britain, Germany,
Japan, Italy, and Canada.  However, the Partnership also takes
futures positions in the government debt of smaller nations -
e.g., Australia.  Demeter anticipates that the G-7 countries? and
Australian interest rates will remain the primary interest rate
exposure of the Partnership for the foreseeable future.  The
speculative futures positions held by the Partnership may range
from short to long-term instruments.  Consequently, changes in
short, medium, or long-term interest rates may have an effect on
the Partnership.

Currency.  The second largest market exposure of the Partnership
at June 30, 2007, was to the currency sector.  The Partnership?s
currency exposure is to exchange rate fluctuations, primarily
fluctuations which disrupt the historical pricing relationships
between different currencies and currency pairs.  Interest rate
changes, as well as political and general economic conditions
influence these fluctuations.  The Partnership trades a large
<page> number of currencies, including cross-rates - i.e.,
positions between two currencies other than the U.S. dollar.  At
June 30, 2007, the Partnership?s major exposures were to the
euro, Canadian dollar, Australian dollar, Japanese yen, Swiss
franc, British pound, and Polish zloty currency crosses, as well
as to outright U.S. dollar positions.  Outright positions consist
of the U.S. dollar vs. other currencies.  These other currencies
include major and minor currencies.  Demeter does not anticipate
that the risk associated with the Partnership?s currency trades
will change significantly in the future.

Equity.  At June 30, 2007, the third largest exposure of the
Partnership was to the global stock index sector, primarily to
equity price risk in the G-7 countries.  The stock index futures
traded by the Partnership are by law limited to futures on
broadly-based indices.  At June 30, 2007, the Partnership?s
primary market exposures were to the NASDAQ 100 (U.S.), Nikkei
225 (Japan), CAC 40 (France), Euro Stoxx 50 (Europe), Hang Seng
(China), S&P 500 (U.S.), TOPIX (Japan), DAX (Germany), FTSE 100
(United Kingdom), IBEX 35 (Spain), Dow Jones (U.S.), and Russell
2000 (U.S.) stock indices.  The Partnership is typically exposed
to the risk of adverse price trends or static markets in the
U.S., European, Chinese, and Japanese stock indices. Static
markets would not cause major market changes, but would make it
difficult for the Partnership to avoid trendless price movements,
resulting in numerous small losses.
<page>
Commodity.
Soft Commodities and Agriculturals.  At June 30, 2007, the
Partnership had market exposure to the markets that comprise
these sectors.  Most of the exposure was to the wheat,
soybean meal, sugar, coffee, cocoa, and live cattle markets.
Supply and demand inequalities, severe weather disruptions,
and market expectations affect price movements in these
markets.

Energy.  At June 30, 2007, the Partnership had market
exposure to the energy sector.  The Partnership?s energy
exposure was primarily to futures contracts in crude oil and
its related products, and natural gas.  Price movements in
these markets result from geopolitical developments,
particularly in the Middle East, as well as weather patterns
and other economic fundamentals. Significant profits and
losses, which have been experienced in the past, are
expected to continue to be experienced in the future.
Natural gas has exhibited volatility in prices resulting
from weather pattern and supply and demand factors and will
likely continue in this choppy pattern.

Qualitative Disclosures Regarding Non-Trading Risk Exposure
The following was the only non-trading risk exposure of the
Partnership at June 30, 2007:
<page>
Foreign Currency Balances. The Partnership?s primary foreign
currency balances at June 30, 2007, were in euros, British
pounds, Swiss francs, Japanese yen, Hong Kong dollars, and
Australian dollars.  The Partnership controls the non-
trading risk of foreign currency balances by regularly
converting them back into U.S. dollars upon liquidation of
their respective positions.


Qualitative Disclosures Regarding Means of Managing Risk Exposure
The Partnership and the Trading Advisor, separately, attempt to
manage the risk of the Partnership?s open positions in essentially
the same manner in all market categories traded.  Demeter attempts
to manage market exposure by diversifying the Partnership?s assets
among different market sectors and trading approaches, and by
monitoring the performance of the Trading Advisor daily.  In
addition, the Trading Advisor establishes diversification
guidelines, often set in terms of the maximum margin to be
committed to positions in any one market sector or market-
sensitive instrument.

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


<page>
Item 4.   CONTROLS AND PROCEDURES
  (a)	As of the end of the period covered by this quarterly
report, the President and Chief Financial Officer of
Demeter, the general partner of the Partnership, have
evaluated the effectiveness of the Partnership?s disclosure
controls and procedures (as defined in Rules 13a?15(e) and
15d?15(e) of the Exchange Act), and have judged such
controls and procedures to be effective.

    (b)	There have been no material changes during the period
covered by this quarterly report in the Partnership?s
internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) of the Exchange Act) or in
other factors that could significantly affect these controls
subsequent to the date of their evaluation.

Item 4T.   CONTROLS AND PROCEDURES
Not applicable.


<page> PART II.  OTHER INFORMATION
Item 1A. RISK FACTORS
There have been no material changes from the risk factors
previously referenced in the Partnership?s Report on Form 10-K for
the fiscal year ended December 31, 2006, and the Partnership?s
Report on Form 10Q for the quarter ended March 31, 2007.
<table>
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
        PROCEEDS
<caption>
					SEC
Registration Statement on Form S-1  Units Registered    Effective Date       File Number

	<c>		  <c>	    <c>

Initial Registration	3,000,000.000		November 6, 1998	333-60115
Additional Registration	6,000,000.000		March 27, 2000	333-91563
Additional Registration	2,000,000.000		July 29, 2002	  333-85076
Additional Registration	9,000,000.000		February 26, 2003	333-103166
Additional Registration	  30,000,000.000		April 28, 2004	333-113876
Total Units Registered          50,000,000.000

Units sold through 6/30/07      37,329,368.443
Units unsold through 6/30/07  _ 12,670,631.557
 </table>

The managing underwriter for the Partnership is MS&Co.

Units are continuously sold at monthly closings at a purchase
price equal to 100% of the net asset value per Unit as of the
close of business on the last day of each month.

The aggregate price of the Units sold through June 30, 2007, was
$698,208,987.

<page> Since no expenses are chargeable against the proceeds, 100%
of the proceeds of the offering have been applied to the working
capital of the Partnership for use in accordance with the ?Use of
Proceeds? section of the prospectus included as part of the above
referenced Registration Statements.

Item 6.  EXHIBITS

31.01	Certification of President of Demeter Management
Corporation, 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 Corporation, 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
Corporation, 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 Corporation, 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.









<page>


SIGNATURE



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



                     Morgan Stanley Charter Graham L.P.
                     (Registrant)

                     By: Demeter Management Corporation
                         (General Partner)

August 14, 2007      By: /s/ Lee Horwitz
                             Lee Horwitz
                             Chief Financial Officer





The General Partner which signed the above is the only party
authorized to act for the Registrant.  The Registrant has no
principal executive officer, principal financial officer,
controller, or principal accounting officer and has no Board of
Directors.
? 14 ?



DEAN WITTER PORTFOLIO STRATEGY FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)