UNITED STATES 
                      SECURITIES AND EXCHANGE COMMISSION 
                             WASHINGTON D.C. 20549


                                  FORM 10-Q  


                Annual Report Pursuant to Section 13 or 15(d) 
                    of the Securities Exchange Act of 1934


               For the Quarterly period ended December 31, 1998


                       Commission File Number:  2-73692

                      The Balanced Opportunity Fund L.P. 
            (Exact name of registrant as specified in its charter)

          Illinois                           36-3655854
     (State or other jurisdiction of    (I.R.S Employer
     incorporation or organization)     Identification No.)


Registrant's telephone number, including area code:(312) 460-9200


Indicate by check mark whether the registrant (1) 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_____<PAGE>



                      The Balanced Opportunity Fund L.P.

                                     Index

                                                                          Page 


Part I - Financial Information

Item 1.   Financial Statements

     Statements of Financial Condition (unaudited)
     as of December 31, 1998 and June 30, 1998              3

     Statements of Operations (unaudited) for the three
     months ended December 31, 1998 and 1997                4

     Statements of Changes in Partners' Capital (unaudited)
     for the three month period ended December 31, 1998 
     and the year ended June 30, 1998                       5

     Note to Unaudited Financial Statements - 
     December 31, 1998                                      6

Item 2.  Management's Discussion and Analysis of Financial
          Condition and Results of Operations               7

Part II - Other Information                                 8

Item 3.  Exhibits and Reports on Form 8-K                   8

Signatures                                                  9<PAGE>



Part I. Financial Information 

Item 1. Financial Statements 

                        The Balanced Opportunity Fund 
                       Statement of Financial Condition 

                                                     December 31,              
                                                          1998        June 30  
Assets                                                (Unaudited)      1998    

Equity in futures and forward trading accounts: 
 Cash                                                  $  610,339   $  273,000 
 Net unrealized gain/(loss) on open contracts              58,056        1,000 
                                                        ---------     -------- 
   Total equity in futures and forward trading account    668,395      274,000 

Guaranteed yield pool, at market                        2,283,994    2,657,000 

Other receivable                                            2,126        3,000 
                                                         --------     -------- 
Total Assets                                           $2,954,514   $2,934,000 
                                                       ==========   ========== 
Liabilities and Partners' Capital 

Liabilities: 
 Accrued administrative expenses                        $  26,138    $  31,000 
 Accrued brokerage commission and fees                      7,604        6,000 
 Accrued management fees                                    2,444        5,000 
 Accrued incentive fees                                         -            - 
 Redemption Payable                                             -       98,000 
 Miscellaneous payables                                         -            - 
                                                         --------     -------- 
                                                           36,186      140,000 

Partners' Capital 
 Limited Partners (units outstanding 1,374.8557; 
   1,967.8520)                                          2,688,018    2,578,000 
 General Partner (units outstanding : 111.1143)           230,309      216,000 
                                                         --------     -------- 
                                                        2,918,328    2,794,000 
                                                         --------     -------- 
Total Liabilities and Partners' Capital                $2,954,514   $2,934,000 
                                                         ========     ======== 
Net Asset Value per Unit                                $2,072.73   $ 1,946.33 

See Note to the unaudited financial statements <PAGE>



                      The Balanced Opportunity Fund L.P. 
                           Statement of Operations 
                                 (unaudited) 

                                      Three Months Ended    Six Months Ended
                                         December 31,        December 31, 
Revenues                                 1998      1997      1998      1997 

Trading profit/(loss): 
 Realized                             $122,007  $(22,000)  $77,314    $270,000 
 Change in unrealized                  (64,436)    8,000    57,469     (92,000)
Foreign currency gain/(loss)              (771)   (1,000)   (1,561)     (3,000)
                                      --------  --------  --------    -------- 
     Total trading profit and 
       foreign currency gain/(loss)     56,800   (15,000)  136,344     175,000 

Guaranteed yield pool: 
 Accrued Interest                       35,228    56,000    71,713     102,000 
 Unrealized market value gain (loss)   (26,623)   33,000    74,175      86,000 
                                      --------  --------  --------    -------- 
     Total guaranteed yield pool revenue 8,605    89,000   145,888     188,000 


Interest Income                          5,838     8,000    10,355      17,000 
                                      --------  --------  --------    -------- 
Total Revenues                          71,243    82,000   292,587     380,000 

Expenses 

Brokerage commissions                 $ 28,297  $ 34,000   $58,339     $71,000 
Management fees                          7,276     8,000    14,317      17,000 
Other administrative expenses           19,500    32,000    39,000      57,000 
State taxes                                  -         -         -           - 
                                      --------  --------  --------    -------- 
                                        55,073    74,000   111,656     145,000 
                                      --------  --------  --------    -------- 
Net Income/(Loss)                     $ 16,169  $  8,000 $ 180,930    $235,000 
                                      ========  ========  ========    ======== 

Net Income/(Loss) Allocated To: 
 Limited Partners                    $ 151,551  $  8,000 $ 166,886    $222,000 
                                      ========  ========  ========    ======== 
 General Partners                    $  13,210  $      - $  14,044    $ 13,000 
                                      ========  ========  ========    ======== 
Net Income/(Loss) per unit 
  outstanding for entire period       $   7.51  $   4.15 $  126.40    $ 117.74 
                                     =========  ========  ========    ======== 
See Note to the unaudited financial statements<PAGE>



                      The Balanced Opportunity Fund L.P.
                  Statement of Changes in Partners' Capital 

                                   Total Units 
                                of Partnership   Limited   General 
                                      Interest  Partners  Partners       Total 

Partners Capital June 30, 1996         3,504  $5,305,000 $ 174,000  $5,479,000 

Redemption                            (1,425) (2,356,000)           (2,356,000)
Net Income (loss)                                422,000    16,000     438,000 
                                     -------   --------- ---------   --------- 

Partners Capital June 30,1997          2,079  $3,371,000 $ 190,000  $3,561,000 

Redemption                              (646) (1,197,815)           (1,197,815)
Net Income (loss)                                405,716    26,265     431,441 
                                     -------   --------- ---------   --------- 
Partners Capital June 30, 1998         1,433   2,578,361   216,265   2,794,626 

Redemption                                 -    (57,229)         -    (57,229) 
Net Income (loss)                          -     166,886    14,044     180,931 
                                     -------   --------- ---------   --------- 
Partners Capital December 31, 1998     1,433  $2,688,018 $ 230,309  $2,918,328
                                     =======   ========= =========   ========= <PAGE>



                      The Balanced Opportunity Fund L.P.

           Note to Unaudited Financial Statements September 30, 1998


Note - Basis of Presentation

     The unaudited financial statements of The Balanced Opportunity Fund L.P.
(the "Partnership") have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X.  Accordingly, they
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.  In the
opinion of management, all adjustments considered necessary for a fair
presentation of the financial condition and results of operations of the
Partnership for the periods presented have been included.  For further
information, refer to the financial statements and footnotes thereto included
in the Partnership's annual report on Form 10-K for the year ended June 30,
1998.<PAGE>



Item 2.  Management's Discussion and Analysis of
            Financial Condition and Results of Operations

 Capital Resources

     The purpose of the Partnership is to trade commodity interests; as such,
the Partnership does not have, nor does it expect to make, any capital
expenditures or have any capital assets that are not operating capital or
assets.  The Partnership's use of assets is solely to provide necessary margin
or premiums for, and to pay any losses incurred in connection with, its trading
activity.  The Net Asset Values are calculated and equity reports are reviewed
by the General Partner on a daily basis to monitor the trading advisors'
activity to maximize the market and credit risks of the Fund.  The General
Partner also monitors the trading advisors' compliance with investment
objectives as set forth in the prospectus.  Redemption of additional units in
the future will impact the amount of funds available for trading commodity
interest.  The amount of funds available was reduced by $57,229 from
redemptions of units during the quarter ended December 31, 1998.

Liquidity

     Most United States commodity exchanges limit fluctuations in commodity
futures contract prices during a single day by regulations referred to as
"daily price fluctuation limits" or "daily limits".  During a single trading
day, no trades may be executed at a price beyond the daily limit.  Once the
price of a futures contract has reached the daily limit for that day, positions
in that contract can neither be taken nor liquidated.  Commodity futures prices
have occasionally reached the daily limit for several consecutive days with
little or no trading.  Similar occurrences could prevent the Partnership from
promptly liquidation unfavorable positions and subject the Partnership to
substantial losses which could exceed the margin initially committed to such
trades.  In addition, even if commodity futures prices have not reached the
daily limit, the Partnership may not be able to execute futures trades at
favorable prices if little trading in such contracts is taking place.  Other
than these limitations on liquidity, which are inherent in the Partnership's
trading of commodity interests, the Partnership's assets are highly liquid and
are expected to remain so.  The counterparty for all exchange traded and
over-the counter contracts was Rosenthal Collins Group LP.  A portion of the
Fund's assets have been invested in certain United States treasury obligations.
This investment is designed to provide ultimate repayment of the investors'
initial contributions.  These securities are not used for trading purposes.<PAGE>



Results of Operations

     Given the volatility of the markets in which the Partnership trades, its
quarterly results can fluctuate significantly and are not indicative of the
expected results for the fiscal year.


     In the three month and six month period ending December 31, 1998, the Fund
experienced trading profits of  $56,800 and $136,344 compared to $(15,000) and
$175,000 for the same periods in 1997.  In the three month and six month period
ending December 31, 1998, the total guaranteed yield pool revenue was $8,605
and $145,888 compared to $89,000 and $188,000 for the same periods in 1997.  

     At December 31, 1998 there was no material credit risk exposure exceeding
10% of total assets for either exchange traded or over-the-counter contracts.

     Brokerage commissions and advisory fees, which are based on the net assets
of the Fund, declined as a direct result of redemptions.

Part II - Other Information

Item 3.  Exhibits and Reports on Form 8-K

     No reports were filed on Form 8-K during the nine months ended December
31, 1998.
     <PAGE>



Signatures
 
     Pursuant to the requirements of  Section 13 or 15(d) of the Securities
Exchange Act of 1934 and to the extent possible due to the acquisition of the
registrant by the undersigned on April 24, 1998; the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly
authorized.
 
The Balanced Opportunity Fund L.P. (Registrant)


By:  Rodman & Renshaw Futures Management, Inc., General Partner     

By:  /s/ J. Robert Collins
     ------------------------
     J. Robert Collins, President


Date:  January 28, 1999<PAGE>