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

                                    FORM 10-K

[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 [No Fee Required] For the year ended December 31, 1998 or

[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
Act   of   1934   [No   Fee   Required]   For   the   transition   period   from
___________to_______________

Commission File Number 0-17446

                  DEAN WITTER DIVERSIFIED FUTURES FUND II L.P.
--------------------------------------------------------------------------------
  (Exact name of registrant as specified in its Limited Partnership Agreement)

          DELAWARE                                 13-3490286      
--------------------------------             -----------------------
(State or other jurisdiction of                (I.R.S. Employer
 incorporation or organization)                Identification No.)
                                         
c/o Demeter Management Corporation
Two World Trade Center, 62nd Fl., New York, N.Y.             10048         
--------------------------------------------------        ------------
(Address of principal executive offices)                    (Zip Code)

Registrant's  telephone  number,  including area code (212) 392-5454  Securities
registered pursuant to Section 12(b) of the Act:

                                                  Name of each exchange
          Title of each class                      on which registered
          --------------------                    --------------------
                  None                                      None          

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

                      Units of Limited Partnership Interest
--------------------------------------------------------------------------------
                                (Title of Class)


         Indicate by check-mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X  No ___

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

State the aggregate  market value of the Units of Limited  Partnership  Interest
held by  non-affiliates  of the registrant.  The aggregate market value shall be
computed by reference  to the price at which units were sold,  as of a specified
date  within 60 days prior to the date of filing:  $9,708,426.30  at January 31,
1999.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                  (See Page 1)



<PAGE>



                  DEAN WITTER DIVERSIFIED FUTURES FUND II L.P.
                       INDEX TO ANNUAL REPORT ON FORM 10-K
                       -----------------------------------
                                DECEMBER 31, 1998
                                -----------------


                                                                     Page No.

DOCUMENTS INCORPORATED BY REFERENCE. . . . . . . . . . . . . . .       ..   1

Part I .

     Item      1.  Business. . . . . . . . . . . . . . . . . . . . . ..  2-4

     Item      2.  Properties. . . . . . . . . . . . . . . . . . . . ..    4

     Item      3.  Legal Proceedings. . . . . . . . . . . . . . . . . .  4-6

     Item      4.  Submission of Matters to a Vote of Security Holders .   6

Part II.

     Item      5.  Market for the Registrant's Partnership Units
              and Related Security Holder Matters . . .     . . . . . . .  7

     Item      6.  Selected Financial Data . . . . . . . . . . . . . ..    8

     Item      7.  Management's Discussion and Analysis of Financial
                   Condition and Results of Operations. . . . . . . . . 9-17

     Item   7A.Quantitative and Qualitative Disclosures About
                   Market Risk . . . . . . . . . . . . . . . . . . . . 17-30

     Item      8.  Financial Statements and Supplementary Data . . . .    30

     Item      9.  Changes in and Disagreements with Accountants on
                   Accounting and Financial Disclosure. . . . . . . .      30
Part III.

     Item     10.  Directors and Executive Officers of the Registrant . 31-35

     Item     11.  Executive Compensation . . . . . . . . . . . . . .      35

     Item     12.  Security Ownership of Certain Beneficial Owners
                   and Management . . . . . . . . . . . . . . . . . .  .   36

     Item     13.  Certain Relationships and Related Transactions .        36

Part IV.

     Item     14.  Exhibits, Financial Statement Schedules, and
                   Reports on Form 8-K . . . . . . . . . . . . . . .       37

<PAGE>


                  DOCUMENTS INCORPORATED BY REFERENCE
                  -----------------------------------


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



          Documents  Incorporated                                 Part   
           of      Form    10-K

          Partnership's Prospectus dated
          October 28, 1988                                          I

          Annual Report to Dean Witter

          Diversified Futures Fund II L.P.
          Limited Partners for the year
          ended December 31, 1998                           II,  III and IV



                                     - 1 -

<PAGE>

                                     PART I

Item 1.  BUSINESS

         (a) General  Development of Business.  Dean Witter Diversified  Futures
Fund II L.P. (the "Partnership") is a Delaware limited partnership  organized to
engage in the  speculative  trading  of  futures  contracts,  commodity  options
contracts and forward contracts on foreign  currencies  (collectively,  "futures
interests").  The general  partner  for the  Partnership  is Demeter  Management
Corporation  ("Demeter").  The  non-clearing  commodity  broker  is Dean  Witter
Reynolds ("DWR") and an unaffiliated  clearing  commodity  broker,  Carr Futures
Inc. ("Carr"),  provides clearing and execution services. The trading manager is
Dean  Witter  Futures  &  Currency  Management  Inc.  ("DWFCM"  or the  "Trading
Manager").  Demeter,  DWR and  DWFCM  are  wholly-owned  subsidiaries  of Morgan
Stanley Dean Witter & Co.
("MSDW").

         The  Partnership's  Net Asset Value per Unit,  as of December 31, 1998,
was $2,824.45  representing an increase of 5.21 percent from the Net Asset Value
per Unit of $2,684.43 at December 31, 1997.  For a more detailed  description of
the Partnership's business, see subparagraph (c).

         (b)  Financial  Information  about  Industry  Segments.  For  financial
information  reporting  purposes,  the  Partnership  is  deemed to engage in one
industry segment,  the speculative  trading of futures  interests.  The relevant
financial information is presented in Items 6 and 8.

                                  -2-
<PAGE>

         (c)  Narrative  Description  of  Business.  The  Partnership  is in the
business  of  speculative  trading of  futures  interests,  pursuant  to trading
instructions  provided by the Trading Manager. For a detailed description of the
different  facets  of the  Partnership's  business,  see those  portions  of the
Partnership's Prospectus ("Prospectus"),  dated October 28, 1988 incorporated by
reference in this Form 10-K, set forth below:

         1.  Facets of Business
             Summary                             1."Summary of the Prospectus"
                                                       (Pages 2-7).

         2.  Commodity Markets                   2."The Commodities Markets"
                                                       (Pages 57-67).

         3.  Partnership's Trading               3."Trading Policies" (Pages
             Arrangements Policies                    28-29). "The Trading
                                                     Manager" (Pages 29-38).

         4.  Management of the Part-             4."The Management Agreement"
             nership                                (Pages 39-41). "The        
                                                     General Partner" (Pages
                                                     41-56) and "The Commodity 
                                                     Broker"(Pages 56-57).     
                                                    "The Limited Partnership   
                                                     Agreement" (Pages 68-73).

         5.  Taxation of the Partner-           5. "Federal Income Tax Aspects"
               ship's Limited Partners              and "State and      
                                                    Local Income Tax Aspects" 
                                                    (Pages 75-83).             
                                                                       




                                  -3-
<PAGE>

    (d) Financial  Information  About Foreign and Domestic  Operations 
        and Export Sales.

     The  Partnership  has not engaged in any  operations in foreign  countries;
however,  the  Partnership  (through the commodity  brokers) enters into forward
contract  transactions  where foreign banks are the contracting party and trades
in futures interests on foreign exchanges.

Item 2.  PROPERTIES

     The executive and administrative  offices are located within the offices of
DWR. The DWR offices  utilized by the Partnership are located at Two World Trade
Center, 62nd Floor, New York, NY 10048.

Item 3.  LEGAL PROCEEDINGS

     On September 6, 10, and 20, 1996, and on March 13, 1997,  similar purported
class  actions  were  filed in the  Superior  Court of the State of  California,
County of Los  Angeles,  on behalf of all  purchasers  of  interests  in limited
partnership  commodity pools sold by DWR. Named defendants include DWR, Demeter,
DWFCM,  MSDW  (all such  parties  referred  to  hereafter  as the  "Dean  Witter
Parties"), the Partnership, certain other limited partnership commodity pools of
which  Demeter is the general  partner,  and certain  trading  advisors to those
pools.  On  June  16,  1997,  the  plaintiffs  in  the  above  actions  filed  a
consolidated  amended  complaint,   alleging,   among  other  things,  that  the
defendants  committed  fraud,  deceit,  negligent   misrepresentation,   various
violations of the California Corporations Code, intentional and negligent breach
of

                                  -4-

fiduciary duty, fraudulent and unfair business practices, unjust enrichment, and
conversion  in the  sale  and  operation  of  the  various  limited  partnership
commodity pools. Similar purported class actions were also filed on September 18
and 20, 1996,  in the Supreme  Court of the State of New York,  New York County,
and on November  14, 1996 in the Superior  Court of the State of  Delaware,  New
Castle County,  against the Dean Witter Parties and certain trading  advisors on
behalf of all purchasers of interests in various limited  partnership  commodity
pools,  including  the  Partnership,  sold by DWR. A  consolidated  and  amended
complaint  in the action  pending in the Supreme  Court of the State of New York
was filed on August 13, 1997,  alleging  that the  defendants  committed  fraud,
breach  of  fiduciary  duty,  and  negligent  misrepresentation  in the sale and
operation of the various limited  partnership  commodity  pools. On December 16,
1997, upon motion of the plaintiffs, the action pending in the Superior Court of
the State of Delaware was voluntarily dismissed without prejudice.  The New York
Supreme  Court  dismissed  the New York  action in  November  1998,  but granted
plaintiffs leave to file an amended complaint,  which they did in early December
1998. The defendants  have filed a motion to dismiss the amended  complaint with
prejudice  on February  1, 1999.  The  complaints  seek  unspecified  amounts of
compensatory  and  punitive  damages  and  other  relief.  It is  possible  that
additional  similar  actions  may be filed  and  that,  in the  course  of these
actions, other parties could be added as

                                  -5-

defendants.  The Dean Witter Parties believe that they and the Partnership  have
strong defenses to, and they will vigorously contest, the actions.  Although the
ultimate outcome of legal proceedings cannot be predicted with certainty,  it is
the opinion of management of the Dean Witter  Parties that the resolution of the
actions will not have a material  adverse  effect on the financial  condition or
the results of operations of any of the Dean Witter Parties or the Partnership.

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













                                       -6-

                                     PART II

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

         There is no established  public trading market for the Units of Limited
Partnership  Interest  ("Units")  in the  Partnership.  The number of holders of
Units at December 31, 1998 was  approximately  573. No  distributions  have been
made by the  Partnership  since it commenced  trading  operations on January 18,
1989. Demeter has sole discretion to decide what distributions, if any, shall be
made to investors in the Partnership.  No determination  has yet been made as to
future distributions.













                                      - 7 -


Item 6.  SELECTED FINANCIAL DATA (in dollars)


<TABLE>
<CAPTION>


                                   For the Years Ended December 31,                  
                                   --------------------------------                  
                           1998           1997        1996          1995             1994
                           ----           ----        ----          ----             ----

<S>                      <C>           <C>           <C>            <C>            <C>      
Total Revenues
(including interest)     1,559,110     2,490,979     643,498        1,556,726      3,037,932



Net Income (Loss)          543,088     1,247,087    (824,517)        (410,574)       853,441



Net Income (Loss)
Per Unit (Limited
& General Partners)         140.02        272.02     (122.41)          (75.58)        133.96


Total Assets            10,845,654    11,801,172  12,617,666       15,550,215     17,710,240


Total Limited
Partners' Capital         10,281,223      11,209,045   12,019,867     14,341,357   16,676,005


Net Asset Value Per
Unit of Limited
Partnership Interest       2,824.45         2,684.43     2,412.41       2,534.82     2,610.40

</TABLE>


















                                      - 8 -
<PAGE>

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

         Liquidity.  Assets  of  the  Partnership  are  deposited  with  DWR  as
non-clearing  broker and Carr as clearing  broker in separate  futures  interest
trading  accounts.  Such  assets are held in either  non-interest  bearing  bank
accounts or in securities  approved by the Commodity Futures Trading  Commission
("CFTC") for investment of customer funds. The Partnership's  assets held by DWR
and Carr may be used as margin solely for the Partnership's  trading.  Since the
Partnership's sole purpose is to trade in futures interests, it is expected that
the Partnership will continue to own such liquid assets for margin purposes.

         The  Partnership's  investment in futures  interests  may, from time to
time, be illiquid.  Most United States futures  exchanges limit  fluctuations in
certain futures  interest prices during a single day by regulations  referred to
as "daily  price  fluctuations  limits"  or  "daily  limits".  Pursuant  to such
regulations,  during a single  trading  day no trades may be  executed at prices
beyond the daily  limit.  If the price for a  particular  futures  interest  has
increased or decreased by an amount equal to the daily limit,  positions in such
futures interest can neither be taken nor liquidated  unless traders are willing
to  effect  trades  at or  within  the  limit.  Futures  interests  prices  have
occasionally  moved the daily limit for several  consecutive days with little or
no trading.  Such market  conditions could prevent the Partnership from promptly
liquidating its futures interests and result in restrictions on redemptions.

                                      -9-
<PAGE>

    There is no limitation on daily price moves in trading forward  contracts on
foreign currency. The markets from some world currencies have low trading volume
and are illiquid,  which may prevent the Partnership from trading in potentially
profitable  markets  or  from  promptly   liquidating   unfavorable   positions,
subjecting it to substantial  losses.  Either of these market  conditions  could
result in restrictions on redemptions.

     Capital  Resources.  The  Partnership  does not have, nor does it expect to
have, any capital assets.  Future redemptions of Units will affect the amount of
funds available for investment in futures interests in subsequent periods. Since
they are at the discretion of Limited  Partners,  it is not possible to estimate
the amount and therefore the impact of future redemptions.

     Results of  Operations.  As of December 31, 1998, the  Partnership's  total
capital was  $10,574,966,  a decrease of $913,260 from the  Partnership's  total
capital of  $11,488,226  at December 31, 1997.  For the year ended  December 31,
1998, the Partnership  generated net income of $543,088,  and total  redemptions
aggregated $1,456,348.

     For the year ended  December  31, 1998,  the  Partnership's  total  trading
revenues,  including interest income,  were $1,559,110.  The Partnership's total
expenses for the year were $1,016,022, resulting in

                                 -10-
<PAGE>

net  income of  $543,088.  The value of an  individual  unit in the  Partnership
increased from $2,684.43 at December 31, 1997 to $2,824.45 at December 31, 1998.

     As of December 31, 1997, the Partnership's total capital was $11,488,226, a
decrease of $782,531 from the  Partnership's  total capital of  $12,270,757,  at
December  31,  1996.  For the year ended  December  31,  1997,  the  Partnership
generated net income of $1,247,087 and total redemptions aggregated $2,029,618.

    For the year ended  December  31,  1997,  the  Partnership's  total  trading
revenues  including  interest income were $2,490,979.  The  Partnership's  total
expenses for the year were  $1,243,892,  resulting in net income of  $1,247,087.
The value of an individual unit in the  Partnership  increased from $2,412.41 at
December 31, 1996 to $2,684.43 at December 31, 1997.

    As of December 31, 1996, the Partnership's total capital was $12,270,757,  a
decrease of $2,334,221  from the  Partnership's  total capital of $14,604,978 at
December  31,  1995.  For the year ended  December  31,  1996,  the  Partnership
incurred a net loss of $824,517 and total redemptions aggregated $1,509,704.

     For the year ended  December  31, 1996,  the  Partnership's  total  trading
revenues  including  interest  income were  $643,498.  The  Partnership's  total
expenses for the year were $1,468,015,  resulting in a net loss of $824,517. The
value of an individual unit in the Partnership

                                 -11-
<PAGE>

decreased from $2,534.82 at December 31, 1995 to $2,412.41 at December 31, 1996.

      The Partnership's  overall performance record represents varied results of
trading in different futures  interests  markets.  For a further  description of
1998  trading  results,  refer to the  letter  to the  Limited  Partners  in the
accompanying  Annual Report to Limited  Partners for the year ended December 31,
1998,  incorporated by reference in this Form 10-K. The Partnership's  gains and
losses are allocated among its partners for income tax purposes.

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

                                      -12-

exchange and clearinghouse, or (ii) assessing its members.

         In cases where the Partnership  trades on a foreign  exchange where the
clearinghouse  is not  funded  or  guaranteed  by the  membership  or where  the
exchange is a "principals' market" in which performance is the responsibility of
the  exchange  member  and not the  exchange  or a  clearinghouse,  or when  the
Partnership enters into off-exchange-traded  contracts with a counterparty,  the
sole recourse of the Partnership will be the clearinghouse,  the exchange member
or the off-exchange-traded contract counterparty,  as the case may be. There can
be no assurance that a  clearinghouse,  exchange or other  exchange  member will
meet its obligations to the Partnership,  and the Partnership is not indemnified
against a default by such parties from Demeter, MSDW or DWR.

         Further,  the law is unclear as to whether a  commodity  broker has any
obligation  to  protect  its  customers  from loss in the event of an  exchange,
clearinghouse  or other  exchange  member  default  on trades  effected  for the
broker's  customers.  Any such obligation on the part of the broker appears even
less clear where the default occurs in a non-US jurisdiction.

         Demeter  deals with the credit risks of all  partnerships  for which it
serves as general partner in several ways.  First, it monitors the Partnership's
credit  exposure to each  exchange on a daily  basis,  calculating  not only the
amount of margin required for it but also the amount of its unrealized  gains at
each exchange, if any. The commodity

                                      -13-
<PAGE>

brokers inform the  Partnership,  as with all its  customers,  of its net margin
requirements  for all its  existing  open  positions,  but do not break that net
figure down,  exchange by exchange.  Demeter,  however,  has  installed a system
which  permits it to  monitor  the  Partnership's  potential  margin  liability,
exchange  by  exchange.  Demeter  is then  able  to  monitor  the  Partnership's
potential net credit exposure to each exchange by adding the unrealized  trading
gains on that exchange, if any, to the Partnership's margin liability thereon.

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

         Third, Demeter has secured, with respect to Carr acting as the clearing
broker for the  Partnership,  a guarantee by Credit  Agricole  Indosuez,  Carr's
parent, of the payment of the "net liquidating value"

                                      -14-
<PAGE>

of  the   transactions   (futures   and  forward   contracts)   in  the
Partnership's account.

         With respect to forward contract trading,  the Partnership  trades with
only those counterparties  which Demeter,  together with DWR, have determined to
be  creditworthy.  At the date of this filing,  the Partnership  deals only with
Carr as its counterparty on forward  contracts.  The guarantee by Carr's parent,
discussed above, covers these forward contracts.

         See "Financial  Instruments" under Notes to Financial Statements in the
Partnership's  Annual Report to Limited Partners for the year ended December 31,
1998, incorporated by reference in this Form 10-K.

         Year  2000  Problem.  Commodity  pools,  like  financial  and  business
organizations and individuals around the world, depend on the smooth functioning
of computer  systems.  Many computer  systems in use today cannot  recognize the
computer code for the year 2000, but revert to 1900 or some other date.  This is
commonly known as the "Year 2000 Problem".  The  Partnership  could be adversely
affected  if computer  systems  used by it or any third party with whom it has a
material  relationship  do  not  properly  process  and  calculate  date-related
information  and data  concerning  dates on or after  January  1,  2000.  Such a
failure could adversely  affect the handling or  determination of futures trades
and prices and other services.

                                      -15-
<PAGE>

         MSDW  began  its  planning  for the Year  2000  Problem  in  1995,  and
currently has several hundred  employees working on the matter. It has developed
its own Year  2000  compliance  plan to deal with the  problem  and had the plan
approved  by  the  company's  executive  management,   Board  of  Directors  and
Information Technology Department.  Demeter is coordinating with MSDW to address
the Year 2000 Problem with respect to Demeter's computer systems that affect the
Partnership.  This includes hardware and software  upgrades,  systems consulting
and computer maintenance.

         Beyond the challenge  facing  internal  computer  systems,  the systems
failure of any of the third  parties  with whom the  Partnership  has a material
relationship - the futures exchanges and clearing organizations through which it
trades, Carr, or the Trading Manager - could result in a material financial risk
to the Partnership.  All U.S. futures exchanges are subject to monitoring by the
CFTC of their Year 2000 preparedness and the major foreign futures exchanges are
also expected to be subject to market-wide testing of their Year 2000 compliance
during  1999.  Demeter  intends to monitor the  progress of Carr and the Trading
Manager throughout 1999 in their Year 2000 compliance and, where applicable,  to
test its external interface with Carr and the Trading Manager.

         A worst case  scenario  would be one in which  trading of  contracts on
behalf  of the  Partnership  becomes  impossible  as a result  of the Year  2000
Problem encountered by any third parties. A less catastrophic but more likely

                                      -16-
<PAGE>

scenario  would be one in which  trading  opportunities  diminish as a result of
technical  problems  resulting in illiquidity  and fewer  opportunities  to make
profitable trades. MSDW has begun developing various  "contingency plans" in the
event that the systems of such third  parties fail.  Demeter  intends to consult
closely with MSDW in implementing those plans.  Despite the best efforts of both
Demeter  and  MSDW,  however,  it is  possible  that  these  steps  will  not be
sufficient to avoid any adverse impact to the Partnership.

         Risks Associated With the Euro. On January 1, 1999, eleven countries in
the  European  Union  established  fixed  conversion  rates  on  their  existing
sovereign  currencies  and converted to a common  single  currency (the "euro").
During a three-year transition period, the sovereign currencies will continue to
exist  but only as a fixed  denomination  of the  euro.  Conversion  to the euro
prevents  the Trading  Manager from  trading in certain  currencies  and thereby
limits its ability to take  advantage of  potential  market  opportunities  that
might  otherwise have existed had separate  currencies  been available to trade.
This could adversely affect the performance results of the Partnership.

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Introduction

The Partnership is a commodity pool engaged primarily in the speculative trading
of futures interests.  The market sensitive  instruments held by the Partnership
are acquired solely for speculative  trading  purposes and, as a result,  all or
substantially all of the Partnership's assets are subject to the

                                     - 17 -

risk of trading loss. Unlike an operating company,  the risk of market sensitive
instruments is integral,  not incidental,  to the Partnership's primary business
activities.

The futures  interests  traded by the  Partnership  involve  varying  degrees of
related  market risk.  Such market risk is often  dependent  upon changes in the
level or volatility of interest rates,  exchange rates,  and/or market values of
financial instruments and commodities. Fluctuations in related market risk based
upon the aforementioned  factors result in frequent changes in the fair value of
the Partnership's open positions,  and,  consequently,  in its earnings and cash
flow.

The Partnership's  total market risk is influenced by a wide variety of factors,
including  the  diversification  effects among the  Partnership's  existing open
positions,  the volatility present within the market(s) and the liquidity of the
market(s). At varying times, each of these factors may act to exacerbate or mute
the market risk associated with the Partnership.

The Partnership's  past performance is not necessarily  indicative of its future
results.  Any  attempt at  quantifying  the  Partnership's  market  risk must be
qualified by the inherent  uncertainty  of its  speculative  trading,  which may
cause future losses and volatility (i.e. "risk of ruin") far in excess of the

                                     - 18 -

Partnership's experience to date and/or any reasonable expectation premised upon
historical changes in the fair value of its market sensitive instruments.

Quantifying the Partnership's Trading Value at Risk 

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

The  Partnership  accounts  for open  positions  on the basis of  mark-to-market
accounting principles.  As such, any loss in the fair value of the Partnership's
open  positions is directly  reflected in the  Partnership's  earnings,  whether
realized or unrealized,  and the Partnership's  cash flow, as profits and losses
on open positions of exchange traded futures interests are settled daily through
variation margin.

The  Partnership's  risk exposure in the various  market  sectors  traded by the
Trading  Manager is estimated  below in terms of Value at Risk ("VaR").  The VaR
model employed by the Partnership incorporates numerous variables that could

                                     - 19 -

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

VaR  models  such as the  Partnership's  are  continually  evolving  as  trading
portfolios become more diverse and modeling techniques and systems  capabilities
improve.  It must also be noted  that the VaR model is used to  quantify  market
risk for historic  reporting purposes only and is not utilized by either Demeter
or the Trading Manager in its daily risk management activities.

                                     - 20 -

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 market  category as of December
31, 1998. As of December 31, 1998, the Partnership's  total  capitalization  was
approximately $11 million.

     Primary Market                         December 31, 1998
     Risk Category                            Value at Risk

         Interest Rate                               (.47)%
         Currency                                    (.96)
         Equity                                      (.18)
         Commodity                                  (1.04)
         Aggregate Value at Risk                    (1.37)%

Aggregate value at risk represents the aggregate VaR of the  Partnership's  open
positions and not the sum of the VaR of the individual  categories listed above.
Aggregate VaR will be lower as it takes into account correlation among different
positions and categories.

The table  above  represents  the VaR of the  Partnership's  open  positions  at
December  31,  1998 only and is not  necessarily  representative  of either  the
historic  or  future  risk  of  an  investment  in  the   Partnership.   As  the
Partnership's  sole  business is the  speculative  trading of primarily  futures
interests, the composition of its portfolio of open positions can

                                - 21 -

change  significantly over any given time period or even within a single trading
day.  Such changes in open  positions  could  materially  impact  market risk as
measured by VaR either positively or negatively.

The table below  supplements  the year end VaR by presenting  the  Partnership's
high,  low and  average  VaR as a  percentage  of total Net  Assets for the four
quarterly reporting periods from January 1, 1998 through December 31, 1998.

Primary Market Risk Category        High        Low        Average
Interest Rate                      (1.82)%      (.47)%      (1.19)%
Currency                           (2.42)       (.96)       (1.75)
Equity                              (.51)       (.18)        (.33)
Commodity                          (3.00)       (.66)       (1.45)
Aggregate Value at Risk            (3.39)%     (1.37)%      (2.71)%


Limitations on Value at Risk as an Assessment of Market Risk

The face value of the  market  sector  instruments  held by the  Partnership  is
typically  many  times  the  applicable  margin  requirements,  as  such  margin
requirements  generally  range  between  2% and  15%  of  contract  face  value.
Additionally,  due to the use of leverage,  the face value of the market  sector
instruments   held  by  the  Partnership  is  typically  many  times  the  total
capitalization of the Partnership.  The financial magnitude of the Partnership's
open positions thus creates a "risk of ruin" not

                                - 22 -

typically found in other  investment  vehicles.  Due to the relative size of the
positions held,  certain market  conditions,  may cause the Partnership to incur
losses greatly in excess of VaR within a short period of time. The foregoing VaR
tables, as well as the past performance of the Partnership,  gives no indication
of such "risk of ruin".

In  addition,   VaR  risk  measures  should  be  interpreted  in  light  of  the
methodology's  limitations,  which include the following: past changes in market
risk factors will not always yield accurate predictions of the distributions and
correlations of future market movements;  changes in portfolio value in response
to market  movements  may differ  from the  responses  implicit  in a VaR model;
published VaR results  reflect past trading  positions while future risk depends
on future positions; VaR using a one-day time horizon does not fully capture the
market risk of positions that cannot be liquidated or hedged within one day; and
the historical  market risk factor data used for VaR estimation may provide only
limited  insight into losses that could be incurred under certain unusual market
movements.

The foregoing VaR tables present the results of the  Partnership's  VaR for each
of the Partnership's market risk exposures and on an aggregate basis at December
31, 1998 and for the end of quarter periods during calendar

                                - 23 -

1998.  Since  VaR is based on  historical  data,  VaR  should  not be  viewed as
predictive of the Partnership's  future financial  performance or its ability to
manage and monitor  risk and there can be no  assurance  that the  Partnership's
actual  losses on a  particular  day will not exceed the VaR  amounts  indicated
below or that such losses will not occur more than 1 in 100 trading days.

Non-Trading Risk

The  Partnership  has  non-trading  market risk on its foreign cash balances not
needed for margin.  However,  such balances, as well as any market risk they may
represent, are immaterial.  The Partnership also maintains a substantial portion
(approximately  91%) of its  available  assets  in cash at  DWR.  A  decline  in
short-term  interest  rates will result in a decline in the  Partnership's  cash
management income. This cash flow risk is not considered material.

Materiality,  as used  throughout  this  section,  is based on an  assessment of
reasonably  possible  market  movements and the potential  losses caused by such
movements, taking into account the leverage, optionality and multiplier features
of the Partnership's market sensitive instruments.

Qualitative Disclosures Regarding Primary Trading Risk Exposures

The  following  qualitative  disclosures  regarding  the  Partnership's
market

                                - 24 -

risk  exposures  - except  for (i)  those  disclosures  that are  statements  of
historical fact and (ii) the  descriptions  of how the  Partnership  manages its
primary market risk exposures - constitute forward-looking statements within the
meaning of Section 27A of the  Securities  Act and Section 21E of the Securities
Exchange Act. The  Partnership's  primary  market risk  exposures as well as the
strategies  used and to be used by Demeter and the Trading  Manager 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  as of December 31, 1998, by market  sector.  It may be  anticipated
however, that these market exposures will vary materially over time.

     Currency.  The  primary  exposure  in the  Partnership  is in the  currency
complex. The Partnership's currency exposure is to exchange

                                - 25 -

rate  fluctuations,  primarily  fluctuations that 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 in a large number of currencies,  including
cross-rates  i.e.,  positions between two currencies other than the U.S. dollar.
However,   the  Partnership's   major  exposures  have  typically  been  in  the
dollar/Swedish krone, dollar/yen, and dollar/Swiss franc positions. Demeter does
not anticipate that the risk profile of the  Partnership's  currency sector will
change  significantly  in the future,  although it is difficult at this point to
predict  the effect of the  introduction  of the Euro on the  Trading  Manager's
currency trading strategies.  The currency trading Value at Risk figure includes
foreign  margin  amounts   converted  into  U.S.  dollars  with  an  incremental
adjustment  to reflect  the  exchange  rate risk  inherent  to the  dollar-based
Partnership  in  expressing  Value at Risk in a functional  currency  other than
dollars.

     Interest Rate. The second largest  exposure is in the interest rate sector.
Interest rate movements  directly affect the price of the sovereign bond futures
positions  held by the  Partnership  and indirectly 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 primary interest rate exposure is
to interest rate

                                - 26 -

fluctuations  in the  United  States,  Australia  and the other  G-7  countries.
Demeter  anticipates  that G-7 and  Australian  interest  rates will  remain the
primary market  exposure of the  Partnership  for the  foreseeable  future.  The
changes in interest rates,  which have the most effect on the  Partnership,  are
changes in long-term and medium-term instruments.  Consequently, even a material
change in short-term  rates would have little effect on the Partnership were the
medium to long term rates to remain steady.

    Equity.  The  Partnership's  equity exposure is limited to price risk in the
S&P  500  and  the  Nikkei  (Japan).  The  stock  index  futures  traded  by the
Partnership  are by law  limited  to futures on  broadly  based  indices.  As of
December 31, 1998, the  Partnership's  only equity  exposure was in the S&P 500.
Demeter  anticipates  little,  if any,  trading in non-G-7  stock  indices.  The
Partnership  is primarily  exposed to the risk of adverse price trends or static
markets in the major U.S. and Japanese indices.  (Static markets would not cause
major market  changes but would make it difficult for the  Partnership  to avoid
being "whipsawed" into numerous small losses).

         Commodity.

            Metals.While the Partnership's primary metals market exposure was to
fluctuations  in base  metals,  exposure in the  precious  metals  impacted  the
portfolio as well. The Partnership aims to equally weight market exposure in the
metals as much as possible, however base metals,

                                       - 27 -

during period of volatility, will affect performance more dramatically than gold
and silver markets. Demeter anticipates that base metals will remain the primary
metals market exposure of the Partnership.

    Energy. On December 31, 1998 the Partnership's energy exposure was shared by
futures  contracts in the oil and natural gas markets.  Price movements in these
markets result from political developments in the Middle East, weather patterns,
and other economic  fundamentals.  While oil prices are currently  depressed and
have shown little volatility as they have decreased  substantially in 1998, they
can be  volatile.  Significant  profits and losses have been and are expected to
continue to be  experienced  in this market.  Natural gas, also a primary energy
market exposure,  has exhibited more volatility than the oil markets on an intra
day and daily basis. It is expected to continue this choppy pattern.

    Soft  Commodities.  In 1998  the  Partnership  had a  reasonable  amount  of
exposure in the markets that comprise these sectors. Within these complexes most
of the  exposure  was in the cocoa and cotton  markets.  Overall,  however,  the
Partnership's exposure in these complexes is generally less than the exposure in
the currency and interest  rate  sectors.  Price  movements in these markets are
affected by supply demand inequalities,  severe weather disruptions,  and market
expectations.



                                - 28 -

Qualitative Disclosures Regarding Non-Trading Risk Exposure

The following was the only  non-trading  risk exposures of the Partnership as of
December 31, 1998:

         Foreign Currency Balances.  The Partnership's  primary foreign currency
balances are in Japanese yen,  British  pounds,  Deutsche  marks and  Australian
dollars.  The  Partnership  controls the  non-trading  risk of these balances by
regularly  converting  these balances back into dollars upon  liquidation of the
respective position.

Qualitative Disclosures Regarding Means of Managing Risk Exposure

The means by which the Partnership and the Trading Manager,  severally,  attempt
to manage the risk of the Partnership's  open positions are essentially the same
in all market  categories  traded.  Demeter attempts to manage the Partnership's
market exposure by (i)  diversifying  the  Partnership's  assets among different
market sectors and trading approaches,  and (ii),  monitoring the performance of
the  Trading  Manager  on a  daily  basis.  In  addition,  the  Trading  Manager
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.



                                - 29 -

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


Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The  information  required by this Item appears in the attached 1998 Annual
Report  to  Limited  Partners  for the  year  ended  December  31,  1998  and is
incorporated by reference in this Annual Report on Form 10-K.

Item 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
         ACCOUNTING AND FINANCIAL DISCLOSURE
         None.











                                 -30-
<PAGE>

                                    PART III

Item 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

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

Directors and Officers of the General Partner

         The directors and officers of Demeter are as follows:

         Mark J.  Hawley,  age 55, is  Chairman  of the Board and a Director  of
Demeter.  Mr. Hawley is also Chairman of the Board and a Director of DWFCM.  Mr.
Hawley  previously  served as President of Demeter  throughout  1998. Mr. Hawley
joined DWR in  February  1989 as Senior  Vice  President  and is  currently  the
Executive Vice President and Director of DWR's Product Management for Individual
Asset Management.  In this capacity, Mr. Hawley is responsible for directing the
activities of the firm's Managed Futures,  Insurance,  and Unit Investment Trust
Business.  From 1978 to 1989,  Mr. Hawley was a member of the senior  management
team at Heinold Asset Management, Inc., a CPO, and was responsible for a variety
of projects in public  futures  funds.  From 1972 to 1978, Mr. Hawley was a Vice
President in charge of institutional block trading for the Mid-West at Kuhn Loeb
& Company.

         Joseph  G.  Siniscalchi,   age  53,  is  a  Director  of  Demeter.  Mr.
Siniscalchi  joined  DWR in July 1984 as a First  Vice  President,  Director  of
General  Accounting  and served as a Senior Vice  President and  Controller  for
DWR's Securities Division through 1997.  He is currently Executive Vice

                                     - 31 -

President  and Director of the  Operations  Division of DWR.  From February 1980
to July  1984,  Mr.  Siniscalchi  was  Director  of  Internal  Audit  at  Lehman
Brothers Kuhn Loeb, Inc.

         Edward  C.  Oelsner,  III,  age  56,  is a  Director  of  Demeter.  Mr.
Oelsner  is  currently  an  Executive  Vice  President  and head of the  Product
Development  Group at Dean Witter  InterCapital  Inc.,  an affiliate of DWR. Mr.
Oelsner joined DWR in 1981 as a Managing  Director in DWR's  Investment  Banking
Department  specializing in coverage of regulated industries and,  subsequently,
served as head of the DWR  Retail  Products  Group.  Prior to joining  DWR,  Mr.
Oelsner  held  positions  at The  First  Boston  Corporation  as a member of the
Research and  Investment  Banking  Departments  from 1967 to 1981.  Mr.  Oelsner
received his M.B.A. in Finance from the Columbia  University  Graduate School of
Business in 1966 and an A.B. in Politics from Princeton University in 1964.

         Robert E.  Murray,  age 38, is  President  and a Director  of  Demeter.
Mr.  Murray is also  President  and a  Director  of DWFCM.  Effective  as of the
close of business on December  31,  1998,  Mr.  Murray  replaced  Mr.  Hawley as
President  of  Demeter.  Mr.  Murray is also a Senior  Vice  President  of DWR's
Managed Futures  Department and is the Senior  Administrative  Officer of DWFCM.
Mr.  Murray  began his career at DWR in 1984 and is  currently  the  Director of
the Managed  Futures  Department.  In this  capacity,  Mr. Murray is responsible
for  overseeing  all  aspects  of the firm's  Managed  Futures  Department.  Mr.
Murray  currently  serves as a Director of the  Managed  Funds  Association,  an
industry

                                     - 32 -

association  for  investment  professionals  in  futures,  hedge funds and other
alternative  investments.  Mr. Murray  graduated  from Geneseo State  University
in May 1983 with a B.A. degree in Finance.

         Lewis A.  Raibley,  III,  age 36, is Vice  President,  Chief  Financial
Officer  and a Director  of  Demeter.  Effective  as of the close of business on
December 31, 1998, Mr. Raibley was elected to Demeter's Board of Directors.  Mr.
Raibley is currently  Senior Vice  President and  Controller  in the  Individual
Asset  Management  Group of MSDW. From July 1997 to May 1998, Mr. Raibley served
as Senior Vice  President and Director in the Internal  Reporting  Department of
MSDW and prior to that,  from 1992 to 1997,  he served as Senior Vice  President
and  Director  in the  Financial  Reporting  and Policy  Division of Dean Witter
Discover & Co. He has been with MSDW and its affiliates since June 1986.

         Mitchell  M. Merin,  age 45,  became a Director of Demeter on March 17,
1999. Mr. Merin was appointed the Chief  Operating  Officer of Asset  Management
for MSDW in  December  1998 and the  President  and Chief  Executive  Officer of
Morgan  Stanley Dean Witter  Advisors in February 1998. He has been an Executive
Vice  President  of DWR since 1990,  during  which time he has been  director of
DWR's Taxable Fixed Income and Futures divisions, managing director in Corporate
Finance and corporate  treasurer.  Mr. Merin received his Bachelor's degree from
Trinity College in Connecticut  and his M.B.A.  degree in finance and accounting
from the Kellogg  Graduate  School of Management of  Northwestern  University in
1977.

                                     - 33 -

         Richard A.  Beech,  age 47,  became a Director  of Demeter on March 17,
1999. Mr. Beech has been associated with the futures industry for over 23 years.
He has been at DWR since August 1984 where he is presently Senior Vice President
and head of Branch Futures. Mr. Beech began his career at the Chicago Mercantile
Exchange,  where  he  became  the  Chief  Agricultural  Economist  doing  market
analysis,  marketing  and  compliance.  Prior to joining DWR, Mr. Beech also had
worked at two investment banking firms in Operations,  Research, Managed Futures
and Sales Management.

         Ray Harris, age 42, became a Director of Demeter on March 17, 1999. Mr.
Harris is  currently  Senior Vice  President,  Planning and  Administration  for
Morgan  Stanley  Dean  Witter  Asset  Management  and has  worked  at DWR or its
affiliates  since  July  1982,  serving  in both  financial  and  administrative
capacities.  From August 1994 to January  1999,  he worked in two  separate  DWR
affiliates,  Discover Financial Services and Novus Financial Corp.,  culminating
as Senior  Vice  President.  Mr.  Harris  received  his B.A.  degree from Boston
College and his M.B.A. in finance from the University of Chicago.

         Richard M. DeMartini,  age 46, previously served as the Chairman of the
Board and as a Director of Demeter throughout 1998. Effective as of the close of
business on December 31,  1998,  Mr.  DeMartini  resigned as the Chairman of the
Board and as a Director of Demeter due to changes in his responsibilities within
MSDW.


                                     - 34 -

         Lawrence  Volpe,  age 51,  served as a Director  to Demeter  throughout
1998.  Effective  as of the close of business on December  31,  1998,  Mr. Volpe
resigned as a Director of Demeter.

         Patti L. Behnke,  age 38, served as Vice President and Chief  Financial
Officer of Demeter through May 1998. Effective June 1, 1998, Ms. Behnke resigned
as Vice President and Chief Financial Officer of Demeter in order to take on new
responsibilities as Operations Officer - Controllers  Division for MSDW, and was
replaced by Mr. Raibley.

Item 11.  EXECUTIVE COMPENSATION

         The Partnership has no directors and executive  officers.  As a limited
partnership,  the business of the  Partnership  is managed by Demeter,  which is
responsible for the  administration  of the business  affairs of the Partnership
but receives no compensation for such services.

Item  12.  SECURITY   OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND  
           MANAGEMENT        

         (a) Security  Ownership of Certain  Beneficial  Owners - As of December
31,  1998  there were no persons  known to be  beneficial  owners of more than 5
percent of the Units.

         (b) Security  Ownership of  Management - At December 31, 1998,  Demeter
owned 104 Units of General  Partnership  Interest  representing  a 2.78  percent
interest in the Partnership.

         (c)      Changes in Control - None

                                - 35 -

Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         Refer to Note 2 - "Related Party  Transactions"  of "Notes to Financial
Statements",  in the accompanying Annual Report to Limited Partners for the year
ended  December 31, 1998,  incorporated  by reference in this Form 10-K.  In its
capacity as the Partnership's  retail commodity broker,  DWR received  commodity
brokerage  commissions (paid and accrued by the Partnership) of $633,726 for the
year ended  December 31,  1998.  In its  capacity as the  Partnership's  trading
manager,  DWFCM received management fees of $327,157 for the year ended December
31, 1998.













                            - 36 -
<PAGE>

                           PART IV

Item 14. EXHIBITS,  FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 
8-K

(a)   1.  Listing of Financial Statements

                  The following  financial  statements and report of independent
public  auditors,  all  appearing in the  accompanying  Annual Report to Limited
Partners for the year ended December 31, 1998, are  incorporated by reference in
this Form 10-K:

                  -        Report   of    Deloitte   &   Touche    LLP,
                  independent  auditors,  for the years ended  December
                  31, 1998, 1997 and 1996.

                  -        Statements  of  Financial  Condition  as  of
                  December 31, 1998 and 1997.

                  - Statements of Operations,  Changes in Partners' Capital, and
                  Cash Flows for the years ended  December  31,  1998,  1997 and
                  1996.

                  -        Notes to Financial Statements.

                  With  exception  of the  aforementioned  information  and  the
information  incorporated  in Items 7, 8, and 13, the  Annual  Report to Limited
Partners  for the year ended  December  31,  1998 is not deemed to be filed with
this report.
                  2.  Listing of Financial Statement Schedules

                  No financial statement schedules are required to be filed with
this report.

         (b)      Reports on Form 8-K

                  No  reports  on Form 8-K have  been  filed by the  Partnership
during the last quarter of the period covered by this report.

         (c)      Exhibits

                  Refer to Exhibit Index on Page E-1.

                                      - 37 -

                                   SIGNATURES

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

                              DEAN  WITTER  DIVERSIFIED  FUTURES  FUND  II L.P.
                                                     (Registrant)

                              BY:  Demeter Management Corporation,
                                    General Partner

March 29, 1999                BY: /s/ Robert E. Murray               
                                  ------------------------------
                                  Robert E. Murray, Director and
                                      President

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

Demeter Management Corporation.

BY:        /s/ Robert E. Murray                               March 29, 1999
               ------------------------------
               Robert E. Murray, Director and
                President

           /s/ Mark J. Hawley                                 March 29, 1999
               ------------------------------
               Mark J. Hawley, Director
                and Chairman of the Board

            /s/Joseph G. Siniscalchi                          March 29, 1999
               ------------------------------
               Joseph G. Siniscalchi, Director


           /s/ Edward C. Oelsner III                          March 29, 1999
               ------------------------------
               Edward C. Oelsner III, Director

          /s/  Mitchell M. Merin                              March 29, 1999
               ------------------------------
               Mitchell M. Merin, Director

           /s/ Richard A. Beech                               March 29, 1999
               ------------------------------
               Richard A. Beech, Director

            /s/ Ray Harris                                    March 29, 1999
               ------------------------------
               Ray Harris, Director

           /s/ Lewis A. Raibley, III                          March 29, 1999
               ------------------------------
               Lewis A. Raibley, III, Director, Chief
                 Financial Officer and Principal
                 Accounting Officer

                                         - 38 -


<PAGE>

                                 EXHIBIT INDEX


        ITEM                                             METHOD OF FILING

 -3.01     Limited Partnership Agreement of
           the Partnership, dated as of
           October 28, 1988.                                     (1)

-10.01     Management Agreement among the
           Partnership, Demeter Management
           Corporation and Dean Witter Futures                   (2)
           & Currency Management Inc. dated
           as of October 28, 1988.

-10.02     Customer  Agreement between the
           Partnership and Dean Witter Reynolds,
           Inc., dated as of October 28, 1988.                   (3)

-13.01     Annual Report to Limited Partners for the year
           ended December 31, 1998.                              (3)

(1)  Incorporated  by  reference  to  Exhibit  3.01  and  Exhibit  3.02  of  the
Partnership's Registration Statement on Form S-1. (File No. 24662)

(2) Incorporated by reference to Exhibit 10.02 of the Partnership's Registration
Statement on Form S-1. (File No. 24462)

(3) Filed herewith.




                                       E-1