AlphaMetrix Managed Futures 10-Q 2010 Q1 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

_________________________

FORM 10-Q

_________________________

(Mark One)

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

For the quarterly period ended March 31, 2010

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: 000-52192

_________________________

ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES)

(Exact name of registrant as specified in its charter)

_________________________

Delaware	03-0607985
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
c/o ALPHAMETRIX, LLC 181 West Madison 34th Floor Chicago, Illinois 60602
(Address of principal executive offices)

 (312)267-8400

(Registrant’s telephone number, including area code)

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  ý No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

                                                                                                                     Yes  ýNo  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer  o                                                      Accelerated filer  o

 Non-accelerated filer    o (Do not check if a smaller reporting company)   Smaller reporting company  ý

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

ii 

ALPHAMETRIX FUTURES LLC (ASPECT SERIES)

QUARTERLY REPORT FOR PERIOD ENDED MARCH 31, 2010 ON FORM 10-Q

Table of Contents

 

		Page
PART I – FINANCIAL INFORMATION
Item 1.	FINANCIAL STATEMENTS Consolidated Statements of Financial Condition (unaudited) Condensed Consolidated Schedules of Investments (unaudited) Condensed Consolidated Statements of Operations (unaudited) Condensed Consolidated Statements of Changes in Members’ Capital (unaudited) Notes to Condensed Consolidated Financial Statements (unaudited)	1
Item 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	17
Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	23
Item 4T.	CONTROLS AND PROCEDURES	23
PART II – OTHER INFORMATION
Item 1.	LEGAL PROCEEDINGS	24
Item 1A.	RISK FACTORS	24
Item 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	24
Item 3.	DEFAULTS UPON SENIOR SECURITIES	24
Item 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	24
Item 5.	OTHER INFORMATION	24
Item 6.	EXHIBITS	25
SIGNATURES		26

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PART I – FINANCIAL INFORMATION

Item 1:  Financial Statements

ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES)

 Consolidated Statements of Financial Condition
(Unaudited)

		March 31, 2010		December 31, 2009
Assets
Equity in commodity trading account at clearing broker:
	Cash	$	58,878,713	$	62,722,219
	Unrealized appreciation/(depreciation) on open contracts, net		2,681,379		(287,319	)
			61,560,092		62,434,900
Cash at bank			5,334,580		2,352,489
Total assets		$	66,894,672	$	64,787,389
Liabilities and Members' Capital
Liabilities
Accrued brokerage commissions		$	5,006	$	5,006
Accrued sales commission			104,632		103,466
Accrued sponsor's fee			26,158		25,866
Accrued management fees			104,807		103,642
Accrued performance fees			-		-
Accrued operating costs and administrative fees			204,644		161,161
Interest payable, net			832		-
Subscriptions received in advance			700,232		688,593
Redemptions payable			935,889		2,294,686
Total liabilities			2,082,200		3,382,420
Members’ Capital
Members (52,702.03 and 52,347.66 units outstanding at March 31, 2010 and
December 31, 2009, respectively, unlimited units authorized)			61,574,548		59,498,830
Sponsor (8.12 units outstanding at March 31, 2010 and December 31, 2009,
unlimited units authorized)			9,487		9,231
Total Aspect Series members' capital			61,584,035		59,508,061
Noncontrolling interest			3,228,437		1,896,908
Total members’ capital			64,812,472		61,404,969
Total liabilities and members’ capital		$	66,894,672	$	64,787,389
See accompanying notes to condensed consolidated financial statements.

1

ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES)

Condensed Consolidated Schedules of Investments

 (Unaudited)

		As of March 31, 2010								As of December 31, 2009
		% of Members’ Capital			Number of Contracts		Net Unrealized Appreciation / (Depreciation) on Open Contracts			% of Members’ Capital					Net Unrealized Appreciation / (Depreciation) on Open Contracts
													Number of Contracts
FUTURES CONTRACTS:
Long Contracts
Domestic
	Agriculture		0.11	%		120	$	69,947			0.82	%		310	$	503,864
	Energy		0.37			105		242,919			0.29			92		175,913
	Interest Rates		-			322		1,052			(0.82	)		474		(505,756	)
	Metals		0.24			77		152,347			(0.92	)		91		(567,985	)
	Indices		0.24			173		157,587			0.26			196		161,414
	Currency		-			-		-			(0.02	)		2		(14,700	)
Foreign
	Agriculture		(0.01	)		14		(3,500	)		0.14			55		87,767
	Indices		0.44			395		288,109			0.54			348		332,218
	Interest Rates		1.61			1,600		1,041,116			(0.83	)		1,936		(508,277	)
	Metals		0.50			70		323,758			0.48			137		295,887
	Currency		-			-		-			0.00			3		73
			3.50	%				2,273,335			(0.06	)				(39,582	)
Short Contracts
Domestic
	Agriculture		0.21			334		136,858			(0.03	)		173		(20,498	)
	Energy		0.16			37		105,660			0.06			11		35,290
	Interest Rates		(0.01	)		9		(4,875	)		0.00			14		2,732
	Indices		-			-		-			0.00			-		-
	Metals		-			-		-			0.00			-		-
Foreign
Agriculture			0.02			81		14,783			0.00			36		1,022
Indices			-			-		-			0.00			-		-
Interest Rates			0.16			453		103,178			0.03			85		16,133
Metals			(0.03	)		15		(22,656	)		(0.08	)		10		(49,512	)
			0.51	%				332,948			(0.02	)				(14,833	)
Total futures contracts			4.01					2,606,283			(0.08	)				(54,415	)
FORWARD CURRENCY CONTRACTS:
Total forward currency contracts long			0.06			-		37,034			(0.12	)		-		(73,476	)
Total forward currency contracts short			0.06			-		38,062			(0.26	)		-		159,428	)
Total forward currency contracts			0.12			-		75,096			(0.38	)		-		(232,904	)
Net unrealized appreciation / (depreciation) on open contracts
			4.13	%			$	2,681,379			(0.46	) %			$	(287,319	)
See accompanying notes to condensed consolidated financial statements.

2

ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES)

Condensed Consolidated Statements of Operations

 (Unaudited)

	January 1, 2010 through March 31, 2010			January 1, 2009 through March 31, 2009
Trading gains (losses):
Net realized gain (loss)	$	(291,956	)	$	2,319,712
Net change in unrealized appreciation
(depreciation) on open contracts		2,968,644			(3,389,989	)
Brokerage commissions		(28,885	)		(43,969	)
Net trading gains (losses)		2,647,803			(1,114,246	)
Investment income:
Interest income	$	952		$	3,134
Total investment income		952			3,134
Expenses:
Sales commissions	$	303,409		$	349,561
Sponsor’s fee		75,854			43,695
Management fees		303,919			350,170
Performance fees		-			9,850
Interest expense		2,802			8,450
Operating costs and administrative fees		103,161			107,908
Total expenses		789,145			869,634
Net investment income (loss)		(788,193	)		(866,500	)
Net income (loss)	$	1,859,610		$	(1,980,746	)
Less:  Net income (loss) attributable to noncontrolling interest		147,078			—
Net income (loss) attributable to Aspect Series		1,712,532			(1,980,746	)
Net income (loss) per unit:
Weighted average number of units outstanding		53,288.20			51,162.80
Net income (loss) per weighted average unit	$	32.137		$	(38.715	)
See accompanying notes to condensed consolidated financial statements.

3

ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES)

Condensed Consolidated Statements of Changes in Members’ Capital

 For the nine months ended March 31, 2010 and 2009

(Unaudited)

For the three months ended March 31, 2010
	Members						Sponsor					Noncontrolling Interest				Total
	Amount			Units			Amount			Units		Amount		Units		Amount			Units
Members’ capital at January 1, 2010	$	59,498,830			52,347.66		$	9,231			8.12	$	1,896,908		n/a	$	61,404,969			52,355.78
Members’ subscriptions		2,189,706			1,945.41			-			-				n/a		2,189,706			1,945.41
Members’ redemptions		(1,826,264	)		(1,591.04	)		-			-		-		n/a		(1,826,264	)		(1,591.04	)
Sale of noncontrolling interest		-			-			-			-		1,184,451		n/a		1,184,451			-
Net income (loss)		1,712,276			-			256			-		147,078		n/a		1,859,610			-
Members’ capital at March 31, 2010	$	61,574,548			52,702.03		$	9,487			8.12		3,228,437		n/a	$	64,812,472			52,710.15
Net asset value per unit at January 1, 2010	$	1,136.609					$	1,136.609
Change in net asset value per unit		31.743						31.743
Net asset value per unit at March 31, 2010	$	1,168.352					$	1,168.352
For the three months ended March 31, 2009
	Members						Sponsor					Noncontrolling Interest				Total
	Amount			Units			Amount			Units		Amount		Units		Amount			Units
Members’ capital at January 1, 2009	$	70,994,651			52,994.33		$	10,878			8.12				n/a	$	71,005,529			53,002.45
Members’ subscriptions		1,354,138			1,004.82			-			-				n/a		1,354,138			1,004.82
Members’ redemptions		4,510,736			(3,343.63	)		-			-				n/a		(4,510,736	)		(3,343.63	)
Net income (loss)		(1,980,425	)		-			(321	)		-				n/a		(1,980,746	)		-
Members’ capital at March 31, 2009	$	65,857,628			50,655.52		$	10,557			8.12		-		n/a	$	65,868,185			50,663.64
Net asset value per unit at January 1, 2009	$	1,339.665					$	1,339.665								$	1,339.665
Change in net asset value per unit		(39.557	)					(39.557	)								(39.557	)
Net asset value per unit at March 31, 2009	$	1,300.108					$	1,300.108								$	1,300.108
See accompanying notes to condensed consolidated financial statements.

4

ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

(1)Organization

As of November 1, 2008, AlphaMetrix, LLC (the “Sponsor”) is the sponsor of AlphaMetrix Managed Futures LLC (the “Platform”). The Sponsor is registered with the U.S. Commodity Futures Trading Commission (“CFTC”) as a commodity pool operator and commodity trading advisor, with the Securities and Exchange Commission (“SEC”) as a Registered Investment Advisor (“RIA”), and is a member of the National Futures Association (“NFA”).  The Platform was formed on July 25, 2006 as a Delaware series limited liability company pursuant to the Delaware Limited Liability Company Act. AlphaMetrix Managed Futures LLC (Aspect Series) (the “Aspect Series”) is a “segregated series” of the Platform.  On November 1, 2008, the Sponsor was assigned sponsorship in the Platform and managerial interest in the Aspect Series from the former sponsor of the Platform, UBS Managed Fund Services, Inc. (“UBS MFS” or the “former sponsor”) and the name of the Aspect Series was changed from UBS Managed Futures LLC (Aspect Series) to AlphaMetrix Managed Futures LLC (Aspect Series), while the name of the Platform was changed from UBS Managed Futures LLC to AlphaMetrix Managed Futures LLC.

The Aspect Series invested substantially all of its assets in AlphaMetrix Managed Futures (Aspect) LLC, previously UBS Managed Futures (Aspect) LLC (the “Trading Fund”).  The Trading Fund then invested substantially all of its assets in AlphaMetrix Aspect Fund – MT0001 (the “Master Fund”) which is advised by Aspect Capital Limited (the “Trading Advisor”).  On August 30, 2009, the Trading Fund ceased operations and, therefore, as of September 1, 2009, the Aspect Series invested directly in the Master Fund.  The Aspect Series, the Trading Fund and the Master Fund are consolidated in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, Consolidation (“ASC 810”) and collectively referred to herein as the (“Series”).  As of December 1, 2009, another entity invested in the Master Fund which is reflected as a noncontrolling interest in the consolidated financial statements.

The Series engages in the speculative trading of bonds, currencies, interest rates, equities, equity indices, debt securities and selected physical commodities and derivatives.  Until October 1, 2009, UBS Securities LLC was the Series’ futures clearing broker (the “Clearing Broker”) and until October 13, 2009, UBS AG was the foreign exchange clearing broker of the Series On and after October 1, 2009 for general futures clearing brokerage, excluding foreign currency, and on and after October 13, 2009 including foreign currency, Credit Suisse Securities (USA) LLC acts as the Series’ clearing broker, although the Series may execute foreign exchange trades through another for eign exchange clearing broker at any time (reference to the “Clearing Broker” shall be UBS Securities LLC if involving matters prior to October 1, 2009 and to Credit Suisse Securities (USA) LLC for matters on or after October 1, 2009.  The Sponsor, over time, intends to offer investors a selection of different trading advisors, each managing a different segregated series of the Platform.  There can be no assurance, however, that any series other than the Series will be offered or that the Series will continue to be offered.  The Series was organized on October 26, 2006 and commenced trading on March 16, 2007.  The Series filed a Form 10, under the Securities Exchange Act of 1934, as amended, with the SEC to register the units of limited liability company interest (“Units”), and such registration became effective October 17, 2006.

The accompanying unaudited consolidated financial statements, in the opinion of management, include all adjustments necessary for a fair presentation of the Series’ financial condition as of March 31, 2010 (unaudited) and December 31, 2009 and the results of its operations for the three months ended March 31, 2010 and 2009 (unaudited). These consolidated financial statements present the results of interim periods and do not include all disclosures normally provided in annual consolidated financial statements. It is suggested that these unaudited consolidated financial statements be read in conjunction with the audited consolidated financial statements and notes included in the Series’ annual report on Form 10-K filed with the SEC for the year ended December 31, 2009. The December 31, 2009 information has been derived from the audited consolidated financial statements as of December 31, 2009.

On March 16, 2007, the Series issued 5,000.00 Units to the Trading Advisor for $5,000,000 (the “Trading Advisor Investment”) and issued 2,760.62 Units for $2,760,620 to third parties. On April 1, 2007, the Series issued 9.94 Units to the former sponsor, UBS MFS, for $10,000. On December 31, 2007, the Trading Advisor redeemed the full

5

value of the Trading Advisor Investment.  On October 31, 2008, UBS MFS redeemed the full value of their Units in conjunction with the assignment of the Sponsor and on November 1, 2008, the Series issued 8.12 Units to the Sponsor for $10,000.

At the sole discretion of the Sponsor, the Series may terminate for any reason (for the avoidance of doubt, the Sponsor shall be entitled, without any violation of any contractual or fiduciary obligation to any investor in the Series (a “Member”), to dissolve the Series at any time).

(2)   Summary of Significant Accounting Policies

Basis of Presentation

The Series includes the accounts of the Aspect Series, the Trading Fund (through August 30, 2009), and the Master Fund.  All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

Commodity futures and forward contract transactions are recorded on the trade date, and open contracts are reflected in net unrealized appreciation (depreciation) on open contracts in the Consolidated Statements of Financial Condition as the difference between the original contract value and the fair value (as determined by exchange settlement prices for futures contracts and cash dealer prices at a predetermined time for forward contracts and physical commodities) as of the last business day of the year or as of the last date of the consolidated financial statements. The net change in unrealized profit (loss) on open contracts from one period to the next is reflected in the net change in unrealized appreciation (depreciation) on open contracts in the Consolidated Statements of Operations.  Realized gains and losses on future s and forward currency contracts are recognized when contracts are closed. Interest income is recognized on an accrual basis.

Foreign Currency Transactions

The Series’ functional currency is the U.S. Dollar (“USD”); however, it transacts business in the USD and in currencies other than the USD.  Trading accounts in non-U.S. currency denominations are susceptible to both movements in the underlying contract markets as well as fluctuations in currency rates.  Assets and liabilities denominated in currencies other than the USD are translated into USD at the rates in effect at the date of the Consolidated Statements of Financial Condition.  Income and expense items denominated in currencies other than the USD are translated into USD at the rates in effect during the period.  Gains and losses resulting from the translation into USD are included with the net realized gain (loss) and net change in unrealized appreciation (depreciation) on open contracts in the Condensed Consolidated Statements of Operations.

Cash at the Clearing Broker

The Series holds various currencies at the Clearing Broker, of which approximately $58,899,831 is held in USD. The non-U.S. currencies fluctuate in value on a daily basis relative to the U.S. Dollar.  On March 31, 2010, the Series held positive amounts of Australian Dollars, Euros, British Pounds, Singapore Dollars, and U.S. Dollars, and negative amounts of Canadian Dollars, Swiss Francs, Hong Kong Dollars, Japanese Yen, and Malaysian Ringgit. A portion of this cash is restricted cash required to meet maintenance margin requirements. Included in cash deposits with the Clearing Broker as of March 31, 2010, was restricted cash for margin requirements of $6,344,788.  This cash becomes unrestricted if the underlying positions it supports are liquidated.

6

Fair Value of Investments

The Series’ investments are stated at fair value in accordance with FASB ASC 820, Fair Value Measurements and Disclosures (“ASC 820”) (formerly, SFAS No. 157 Fair Value Measurements). ASC 820 establishes a framework for measuring fair value and expands disclosures about fair value measurements. ACS 820 also emphasizes that fair value is a market based measurement, not an entity-specific measurement, and sets out a fair value hierarchy with the highest priority being quoted prices in active markets. Under ASC 820, fair value measurements are disclosed by level within that hierarchy, as follows:

Level 1 – Values for investments classified as Level 1 are based on unadjusted quoted prices for identical investments in an active market. Since valuations are based on quoted prices that are readily accessible at the measurement date, valuation of these investments does not entail a significant degree of judgment.

Level 2 – Values for investments classified as Level 2 are based on quoted prices for similar investments in an active or non-active markets for which all significant inputs are observable either directly or indirectly. Level 2 inputs may also include discounts related to restrictions on the investments.

Level 3 – Values for securities categorized as Level 3 are based on prices or valuation techniques that require inputs that are both significant to the fair value and unobservable, including valuations by the Sponsor or custodian in the absence of readily ascertainable market values.

When the inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to fair value.

The inputs or methodologies used for valuing investments are not necessarily indicative of the risk associated with investing in those instruments. The following table provides the fair value measurements of applicable Series’ assets and liabilities by level within the fair value hierarchy as of March 31, 2010. These assets are measured on a recurring basis.

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				Fair Value Measurements at Reporting Date Using
Description				Quoted Prices in
				Active Markets for			Significant Other			Significant
	Fair Value at			Identical Investments			Observable Inputs			Unobservable Inputs
	March 31, 2010			(Level 1)			(Level 2)			(Level 3)
Assets
Futures contracts
Agriculture	$	365,319		$	365,319		$	-		$	-
Energy		348,579			348,579			-			-
Indices		455,223			455,223			-			-
Interest Rates		1,400,892			1,400,892			-			-
Metals		485,715			485,715			-			-
Forward currency
contracts		431,409			-			431,409			-
Total investment assets
at fair value		3,487,137			3,055,728			431,409			-
Liabilities
Futures contracts
Agriculture		(147,231	)		(147,231	)		-			-
Indices		(9,527	)		(9,527	)		-			-
Interest Rates		(260,421	)		(260,421	)		-			-
Metals		(32,266	)		(32,266	)		-			-
Forward currency
contracts		(356,313	)		-			(356,313	)		-
Total investment liabilities
at fair value		(805,758	)		(449,445	)		(356,313	)		-
Total investment assets at
fair value - net	$	2,681,379		$	2,606,283		$	75,096		$	-

8 

				Fair Value Measurements at Reporting Date Using
	Fair Value at			Quoted Prices in Active Markets for Identical Investments			Significant Other Observable Inputs			Significant Unobservable Inputs
Description	December 31, 2009*			(Level 1)			(Level 2)			(Level 3)
Assets
Futures contracts
Agriculture	$	712,178		$	712,178		$	-		$	-
Currency		97			97			-			-
Energy		218,571			218,571			-			-
Indices		519,159			519,159			-			-
Interest		357,059			357,059			-			-
Metals		389,697			389,697			-			-
Forward currency
contracts		449,173			-			449,173			-
Total investment assets
at fair value		2,645,934			2,196,761			449,173			-
Liabilities
Futures contracts
Agriculture		(140,023	)		(140,023	)		-			-
Currency		(14,724	)		(14,724	)		-			-
Energy		(7,368	)		(7,368	)		-			-
Indices		(25,527	)		(25,527	)		-			-
Interest		(1,352,227	)		(1,352,227	)		-			-
Metals		(711,307	)		(711,307	)		-			-
Forward currency
contracts		(682,077	)		-			(682,077	)		-
Total investment liabilities
at fair value		(2,933,253	)		(2,251,176	)		(682,077	)		-
Total investment assets at
fair value - net	$	(287,319	)	$	(54,415	)	$	(232,904	)	$	-

Derivative Instruments

The Series discloses certain quantitative and qualitative matters relating to derivatives as prescribed by FASB ASC 815, Derivative and Hedging (“ASC 815”) (formerly, SFAS No. 161, Disclosures about Derivatives and Hedging Activities-an amendment of FASB Statement No. 133). ASC 815 requires qualitative disclosure about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments and disclosures about credit-risk-related contingent features in derivative agreements. As a result of the adoption, the Series has expanded its disclosures regarding derivative instruments.

9

 The Series engages in the speculative trading of U.S. and foreign futures contracts and forward currency contracts (collectively “derivatives”).  These derivatives include both financial and non-financial contracts held as part of a diversified trading strategy.  The Series is exposed to both market risk, the risk arising from changes in the market value of the contracts, and credit risk with the clearing brokers, the risk of failure by another party to perform according to the terms of a contract.  Also, see discussions in notes 1 and 6.

The Series deploys multiple trading strategies that seek to identify and exploit directional moves in market behavior of a broad range of global financial futures, commodity futures and OTC derivative contracts including (but not limited to) bonds, currencies, interest rates, equities, equity indices, debt securities and selected physical commodities.  During the three months ended March 31, 2010, the Series had net trading gain/(loss), including both realized and unrealized gains/(losses) in the following sectors:

Energy - As of March 31, 2010, the Series held 105 long energy contract with a notional value of $9,368,266, and 37 short contracts with a notional value of $1,431,530.  The Series had exposure to the gasoline, heating and crude oil, and natural gas markets.

Agriculture - As of March 31, 2010, the Series held 134 long agriculture contracts with a notional value of $5,102,198, and 415 short contracts with a notional value of $7,388,622.  The Series held positions in soybeans, livestock, orange juice, cotton, and palm oil markets.

Interest Rates - As of March 31, 2010, the Series held 1,922 long interest rate contracts with a notional value of $470,529,525, and 462 short contracts with a notional value of $225,445,150.  The Series had its largest exposure in the short-term interest rate markets.  This exposure was concentrated primarily in the North American and European markets, with smaller allocations of the contracts in the Japanese interest rate market.

Indices - As of March 31, 2010, the Series held 568 long index contracts with a notional value of $29,342,248. The Series held positions on exchanges in the U.S., Australia, South Africa, Hong Kong, Japan, and Europe markets.

Metals - As of March 31, 2010, the Series held 147 long metals contracts with a notional value of $12,350,105 and 15 short metals contracts with a notional value of $854,581.  Within industrial metals, the Series held positions in copper, nickel, lead, zinc, and aluminum. Within the precious metal market, the Series had exposure to the gold and platinum markets.

Forward Currency Contracts - As of March 31, 2010, the Series held forwards in Canadian Dollars, Swiss Francs, Euros, Japanese Yen, Mexican Pesos, Norwegian Krone, Singapore Dollars, Australian Dollars, British Pounds, New Zealand Dollars, and South African Rand.  The notional value of the long forward contracts is $54,951,325, while the notional value of the short contracts is $54,876,230.

During the three months ended March 31, 2010, the Series made 16,910 transactions.

The following table presents the fair value of open futures and forward currency contracts as an asset derivative if in a gain position and a liability derivative if in a loss position.  Fair value is presented on a gross basis in the table below even though the futures and forward currency contracts are subject to master netting agreements and qualify for net presentation in the Consolidated Statements of Financial Condition in accordance with ASC 815.

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As of March 31, 2010	Asset Derivatives Fair Value*		Liability Derivatives Fair Value*
Agriculture contracts	$	365,319	$	(147,231	)
Energy contracts		348,579		-
Indices contracts		455,223		(9,527	)
Forward currency contracts		431,409		(356,313	)
Interest Rate contracts		1,400,892		(260,421	)
Metals contracts		485,715		(32,266	)
Total derivatives not designated as
hedging instruments under ASC 815	$	3,487,137	$	(805,758	)

*Located in  unrealized appreciation/(depreciation) on open contracts, net in the Condensed Consolidated Statements of Financial Condition

As of December 31, 2009	Asset Derivatives Fair Value*		Liability Derivatives Fair Value*
Agriculture contracts	$	712,178	$	(140,023	)
Currency contracts		97		(14,724	)
Energy contracts		218,571		(7,368	)
Indices contracts		519,159		(25,527	)
Forward currency contracts		449,173		(682,077	)
Interest Rate contracts		357,059		(1,352,227	)
Metals contracts		389,697		(711,307	)
Total derivatives not designated as
hedging instruments under ASC 815	$	2,645,934	$	(2,933,253	)

*Located in  unrealized appreciation/(depreciation) on open contracts, net in the Condensed Consolidated Statements of Financial Condition

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The effect of trading futures and forward currency contracts on the Condensed Consolidated Statements of Operations for the three and nine months ended March 31, 2010 is detailed below:

		Net Trading Gain/(Loss)* three months ended March 31, 2010			Net Trading Gain/(Loss)* three months ended March 31, 2009
Futures contracts:	Currencies		-			(13,347	)
	Energy		4,295			562,075
	Agriculture		(673,100	)		(269,856	)
	Interest Rates		3,342,949			25,088
	Indices		(371,150	)		(322,068	)
	Metals		(507,644	)		(247,217	)
Total Futures contracts:			1,795,350			(265,325	)
Forward currency contracts:			899,313		$	(804,952	)
Total Net Trading Gain/(Loss)		$	2,694,663		$	(1,070,277	)

* Includes both realized losses of $291,956 and net change in unrealized appreciation (depreciation) of $2,968,644 and is located in net trading gains (losses) in the Condensed Consolidated Statements of Operations. Amounts exclude foreign currency transaction and translation loss of $17,975.

Income Taxes

As the Series is classified as a partnership for income tax purposes, no provision has been made in the accompanying Consolidated Financial Statements for U.S. federal or state income taxes as each Member is individually responsible for reporting income or loss based on such Member’s share of the Series’ income and expenses as reported for income tax purposes.

In July 2006, FASB issued certain provisions of ASC Topic 740 (“ASC 740”), Income Taxes, related to accounting for uncertainty in income taxes. ASC 740 prescribes the minimum recognition threshold a tax position must meet in connection with accounting for uncertainties in income tax positions taken or expected to be taken by an entity before being measured and recognized in the financial statements. ASC 740 requires the evaluation of tax positions taken in the course of preparing the tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax benefits of positions not deemed to meet the more-than-likely-than-not threshold would be recorded as a tax expense in the current year. M anagement has adopted certain provisions of ASC 740, and the Series recognized no liability in connection with ASC 740. The Series is subject to U.S. Federal, state and local or non-US income tax examinations by tax authorities for all tax years since inception.

Distributions

The Sponsor does not currently intend to make any distributions. Consequently, in order to pay the taxes attributable to their investment in the Series, Members must either redeem Units or pay such taxes from other sources.

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Subscriptions

Units are purchased generally at the beginning of each calendar month based on the net asset value per Unit for all other purposes (see Note 3) calculated for the prior month-end.  The subscription request must be submitted at least seven calendar days prior to the first day of any month in which a Member intends to invest.

Redemptions

Units may be redeemed as of the end of any calendar month (each, a “Redemption Date”) at the net asset value per Unit for all other purposes (see Note 3) as of such Redemption Date.  Redemption requests must be submitted on or prior to the 15th day of the calendar month of such Redemption Date or the following business day, if the 15th is not a business day.  The Sponsor may permit redemptions at other times and on shorter notice.

Indemnifications

In the normal course of business, the Series enters into contracts and agreements that contain a variety of representations and warranties and which would provide general indemnifications.  The maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Series that have not yet occurred.  The Series expects the risk of any future obligation under these indemnifications to be remote.

(3)           Related Party Transactions

2010

Each Member or Member-related account is subject to an upfront, waivable placement fee of 0%-2% of the subscription price of the Units, which will be paid once by the relevant Member (not by the Series or by the Sponsor) on each of such Member’s subscriptions to the Series to UBS Financial Services Inc. (“UBS FS”), an affiliate of UBS Securities LLC, the Series’ former Clearing Broker and UBS Managed Fund Services, Inc., the Series’ former sponsor (see Note 1). The placement fee payable on such initial subscription is deducted from the subscription amount by UBS FS. Upfront placement fees of $8,264 and $4,862 for the three months ended March 31, 2010 and 2009, respectively, were deducted from proceeds received from the Members.

Members are subject to an ongoing sales commission paid to UBS FS (prior to October 1, 2009) and Credit Suisse Securities LLC (subsequent to October 1, 2009), equal to 2% per annum of the month-end net asset value for all other purposes (see below). The Series incurred sales commissions of $303,409 and $349,561 for the three months ended March 31, 2010 and 2009, respectively, and accrued $104,632 and $110,653 owed to Credit Suisse Securities and UBS FS at March 31, 2010 and 2009, respectively. Credit Suisse Securities LLC or UBS FS, in consultation with the Sponsor, may waive or reduce the sales commission for certain Members without entitling any other Member to such waiver or reduction. Additionally, effective January 1, 2008, 0.50% of the 2.0% management fee is shared by the Trading Advisor with UBS FS (refer to Note (4) for further details on the management fee).

Prior to October 1, 2009, the Sponsor received a monthly sponsor fee of 0.02083 of 1% (a 0.25% annual rate) of the Series’ month-end net asset value for all other purposes, including interest income, of a Member’s investment in the Series for such month up until September 30, 2009 (see below). Starting October 1, 2009, the Sponsor receives a monthly sponsor fee of 0.04166 of 1% (a 0.50% annual rate) of the Series’ month-end net asset value for all other purposes, including interest income, of a Member’s investment in the Series for such month. The Sponsor reserves the right to waive or reduce the fee at its sole discretion. The Series incurred Sponsor’s fees of $75,854 and $43,695 for the three months ended March 31, 2010 and 2009, respectively, and accrued $26,158 and $13,832 owed to the Sponsor at March 31, 2010 and 2009, respectively.

The former sponsor paid all expenses incurred in connection with the organizational and initial offering of the Units at the Series level. As described in the Series’ current Confidential Disclosure Document (including Parts One, Two, and Three, the “Disclosure Document”), the Series reimbursed the former sponsor for these costs. For financial reporting purposes in conformity with GAAP, the Series expensed the total organizational costs of $208,820 when incurred and deducted the initial offering costs of $119,732 from Members’ capital as of March 16, 2007 (the date of commencement of operations of the Series) (“net asset value for financial reporting” or the “net asset value per Unit

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for financial reporting”). For all other purposes, including determining the net asset value per Unit for subscription and redemption purposes, the Series amortizes organizational and initial offering costs over a 60 month period (“net asset value for all other purposes” or the “net asset value per Unit for all other purposes”).

2009

The Series incurred brokerage commissions, and a portion of these brokerage commissions were paid to Dekla Financial, LLC, (“Dekla”), a registered introducing broker with the CFTC and an affiliate of the Sponsor.  Dekla began acting as the introducing broker for the Series’ futures and forward contract transactions effective November 1, 2008. Dekla received a portion of the brokerage commissions paid by the Series to the Clearing Broker, which amounted to $32,789 for the three months ended March 31, 2009. As of October 1, 2009, Dekla no longer receives any fees from the Series.

The former sponsor paid all expenses incurred in connection with the organizational and initial offering of the Units at the Series level.  As described in the Series’ current Confidential Disclosure Document (including Parts One, Two and Three, the “Disclosure Document”), the Series reimbursed the former sponsor for these costs.  For financial reporting purposes in conformity with U.S. GAAP, the Series expensed the total organizational costs of $208,820 when incurred and deducted the initial offering costs of $119,732 from Members’ capital as of March 16, 2007 (the date of commencement of operations of the Series) (“net asset value for financial reporting ” or the “net asset value per Unit for financial reporting”).  For all other purposes, including determining the net asset value per Unit for subscription and redemption purposes, the Series amortizes organizational and initial offering costs over a 60 month period (“net asset value for all other purposes” or the “net asset value per Unit for all other purposes”).

Net Asset Value

The quarterly net asset value and net asset value per Unit since commencement of operations are as follows:

	Net Asset Value						Net Asset Value per Unit
	All Other Purposes		Financial Reporting		Number of Units		All Other Purposes			Financial Reporting
Price at Commencement*								1,000.000			1,000.000
March 31, 2007		7,805,411		7,479,686		7,760.62		1,005.772			963.801
June 30, 2007		13,409,546		13,100,248		11,988.08		1,118.573			1,092.773
September 30, 2007		18,932,687		18,639,817		18,241.85		1,037.871			1,021.816
December 31, 2007		16,034,264		15,757,821		14,700.02		1,090.765			1,071.959
March 31, 2008		20,507,363		20,247,348		17,025.49		1,204.509			1,189.237
June 30, 2008		50,168,558		49,924,971		40,063.82		1,252.216			1,246.136
September 30, 2008		59,013,279		58,786,119		52,463.77		1,124.839			1,120.509
December 31, 2008		71,216,262		71,005,529		53,002.45		1,343.641			1,339.665
March 31, 2009		66,062,490		65,868,185		50,663.64		1,303.950			1,300.108
June 30, 2009		48,597,098		48,419,221		43,344.52		1,121.182			1,117.074
September 30, 2009		65,446,804		65,285,354		55,797.55		1,172.933			1,170.040
December 31, 2009		59,653,082		59,508,061		52,355.78		1,139.379			1,136.609
March 31, 2010		61,712,630		61,584,035		52,710.17		1,170.792			1,168.352
Total return after performance fee, from the commencement of operations through the period ended March 31, 2010
								17.08	%		16.84	%
* Commencement of operations of the Series was March 16, 2007

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(4)           Advisory Agreement

Under a signed agreement, the Trading Advisor receives a monthly management fee at the rate of 0.167% (a 2% annual rate) of the Series’ month-end net asset value for all other purposes (see Note 3) calculated before reduction for any management fees, performance fees, Sponsor’s fees, sales commission or extraordinary fees accrued (including performance fees accrued in a prior month) as of such month-end and before giving effect to any capital contributions made as of the beginning of the month immediately following such month-end and before any distributions or redemptions accrued during or as of such month-end, but after all expenses as of such month-end. The Series incurred management fees of $303,919 for the three months ended March 31, 2010, re spectively, of which $104,807 was owed to the Trading Advisor at March 31, 2010.  For the three months ended March 31, 2009, the Series incurred management fees of $350,170.

Also, under a signed agreement the Series pays to the Trading Advisor a quarterly performance fee equal to 20% of the new net trading profits of the Series calculated before deducting the administrative fee, the Sponsor’s fee and sales commission but after deducting the management fee. The Series incurred performance fees of $0 for the three months ended March 31, 2010, respectively, of which $0 was owed to the Trading Advisor at March 31, 2010.  For the three months ended March 31, 2009, the Series incurred performance fees of $9,850.

(5)           Recent Accounting Pronouncements

In January 2010, the FASB issued ASU No. 2010-06, Fair Value Measurements and Disclosures (ASU No. 2010-06), which amends ASC 820, adding new requirements for disclosures for Levels 1 and 2, separate disclosures of purchases, sales, issuances, and settlements relating to Level 3 measurements and clarification of existing fair value disclosures. ASU No. 2010-06 is effective for periods beginning after December 15, 2009, except for the requirement to provide Level 3 activity of purchases, sales, issuances, and settlements on a gross basis, which will be effective for fiscal years beginning after December 15, 2010. The adoption of ASU No. 2010-06 did not have a significant impact on the Series’ financial statements or disclosures.

(6)           Trading Activities and Related Market and Credit Risk

The Series engages in the speculative trading of U.S. and foreign futures contracts and forward contracts. This includes both financial and non-financial contracts held as part of a diversified trading strategy. The Series is exposed to both market risk and credit risk. Derivative financial instruments speculatively traded by the Series can include U.S. and foreign futures and options on futures contracts, exchange for physical transactions, forward currency contracts and swap contracts (collectively, “derivatives”) whose values are based upon an underlying asset, indices, or reference rates, and generally represent future commitments to exchange cash flows, or to purchase or sell other financial instruments at specified future dates. A derivative contract may be traded on an exchange or over the counter (“OTC”). Exchange-traded derivatives are standardized and include futures and option on futures contracts. OTC derivative contracts are negotiated between contracting parties and include forwards, swaps, and certain options. Derivatives are subject to various risks similar to those related to the underlying financial instruments including market and credit risks.

Market risk is the potential for changes in the value of derivatives due to market changes, including interest and foreign exchange rate movements and fluctuations in commodity and security prices. Market risk is directly impacted by the volatility and liquidity in the markets in which the related underlying assets are traded. The market risk of the Series is managed by the underlying Trading Advisor according to its trading program. The Series is exposed to a market risk equal to the notional contract value of the derivatives contracts purchased and unlimited liability on such contracts sold short.

Credit risk is the possibility that a loss may occur due to the failure of a counterparty to perform according to the terms of a contract. Credit risk due to exchange traded financial instruments is significantly reduced by the regulatory requirements of the individual exchanges on which the instruments are traded. At any point in time, the credit risk for OTC derivatives is limited to the net unrealized gain as reported in the consolidated Statements of Financial Condition for each counterparty for which a netting agreement exists, if any. In a similar fashion, liabilities represent net amounts owed to counterparties. This netting basis is executed across products and cash collateral when these provisions are specified in the netting agre ement.

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Purchase and sale of futures contracts requires margin deposits with the broker. Additional deposits may be necessary for any loss on contract value. The Commodity Exchange Act requires a broker to segregate all customer transactions and assets from such broker’s proprietary activities. A customer’s cash and other property (for example, U.S. Treasury bills) deposited with a broker are considered commingled with all other customer funds subject to the broker’s segregation requirements. In the event of a broker’s insolvency, recovery may be limited to a pro rata share of segregated funds available. It is possible that the recovered amount could be less than total cash and other property deposited.

The Series trades forward currency contracts in unregulated markets between principals and assumes the risk of loss from counterparty nonperformance. Accordingly, the risks associated with forward currency contracts are generally greater than those associated with exchange traded contracts because of the greater risk of counterparty default. Additionally, the trading of forward currency contracts typically involves delayed cash settlement.

The Series has a substantial portion of its assets on deposit with a counterparty. In the event of the counterparty’s insolvency, recovery of the Series assets on deposit may be limited to account insurance or other protection afforded such deposits.

To evaluate and monitor counterparty risk for each counterparty, the AlphaMetrix Risk Department initially evaluates the credit ratings from the major agencies: Moody’s, Standard & Poor’s and Fitch Ratings. Credit ratings and outlooks are monitored daily for downgrades whereby an investigation is initiated upon an adverse occurrence. Further, any large decline in the daily stock price also triggers an investigation. Lastly, quarterly reports on earnings and future outlooks from counterparties are reviewed and analyzed for unfavorable results by the Risk Department.

(7)           Financial Highlights

The following financial highlights show the Series’ financial performance for the three months ended March 31, 2010 and 2009, respectively.  All performance returns noted are calculated based on the net asset value per Unit for financial reporting, with organizational costs incurred prior to issuance of Units being expensed at the commencement of the operations of the Series.  Total return is calculated as the change in a theoretical Member’s investment over the entire period - a percentage change in the Member’s capital value for the period.  Financial highlights of the Series for the period ended March 31, 2009, are presented in the table below. The information has been derived from information presented in the consolidated financial statements.

Regarding the information shown in the table below:

·   Per share operating performance is computed based upon the weighted-average net shares for the period ended March 31, 2010 and 2009.  Total return is calculated as the change in the net asset value per share for the period ended March 31, 2010 and 2009 and is not annualized.

·   The net investment loss and total expense ratios are computed based upon the weighted average net assets for the period ended March 31, 2010 and 2009. Such ratios have been annualized, with the exception of the performance fee, and include brokerage commissions.

An individual member’s total return and ratios may vary from those below based on the timing of capital transactions.

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	Three Months Ended March 31, 2010			Three Months Ended March 31, 2009
Members’ capital per Unit at beginning of period	$	1,136.609		$	1,339.665
Income from operations:
Net trading gain/(loss)		47.046			(22.621	)
Net investment loss		(15.303	)		(16.936	)
Net change in Members’ capital per Unit from operations		31.743			(39.557	)
Members’ capital per Unit at end of period	$	1,168.352		$	1,300.108
Total return:
Total return before performance fee		2.79	%		(2.94	%)
Performance fee		0.00	%		(0.01	%)
Total return after performance fee		2.79	%		(2.95	%)
Ratios to average Members’ capital
Net investment loss		(5.40	%)		(5.28	%)
Expenses:
Expenses		5.41	%		5.28	%
Performance fee		0.00	%		0.01	%
Total expenses		5.41	%		5.29	%

(8)         Subsequent Events

In accordance with ASC 855, Subsequent Events, the Series has evaluated and disclosed all subsequent events through the date the financial statements are issued.

Member Subscriptions and Redemptions

Subsequent to March 31, 2010, Members subscribed approximately $816,649 and redeemed approximately $1,354,337 through the issue date of the financial statements.

Item 2:  Management’s Discussion and Analysis of Financial Condition and Results of Operations

Reference is made to Item 1 “Financial Statements.”  The information contained therein is essential to, and should be read in connection with, the following analysis.

All figures and performance returns noted in this Item 2 are based on the net asset value and/or the net asset value per Unit for all other purposes, which complies with U.S. generally accepted accounting principles, except with respect to organizational and initial offering costs (which are being amortized over 60 months) as described in the “Notes to Consolidated Financial Statements – (3) Related Party Transactions.”  All figures and performance returns communicated to investors are based on the net asset value and/or the net asset value per Unit for all other purposes.

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Operational Overview

This performance summary describes the manner in which the Series has performed in the past and is not an indication of future performance.  While certain market movements are attributable to various market factors, such factors may or may not have caused such movements but they may have simply occurred at or about the same time.

The Series is unlikely to be profitable in markets in which trends do not occur.  Static or erratic prices are likely to result in losses.  Similarly, sharp trend reversals, which can be caused by many unexpected events, can lead to major short-term losses, as well as gains.

While there is no assurance the Series will profit in any market condition, markets having substantial and sustainable price movements offer the best profit potential for the Series.

Liquidity

Virtually all of the Series’ capital is held in cash or cash equivalents at the Clearing Broker and is used to margin the Series’ futures and forward currency positions and is withdrawn, as necessary, to pay redemptions and expenses.  The Series does not maintain any sources of financing other than that made available by the Clearing Broker to fund foreign currency settlements for those instruments transacted and settled in foreign currencies.  The Series pays prevailing market rates for such borrowings.

Other than potential market-imposed limitations on liquidity, due, for example, to limited open interest in certain futures markets or to daily price fluctuation limits, which are inherent in the Series’ futures and forward trading, the Series’ assets are highly liquid and are expected to remain so.  Accordingly, the Series expects to be able to liquidate all of its open positions or holdings quickly and at prevailing market prices, except in unusual circumstances.  This generally permits the Trading Advisor to enter and exit markets, leverage and deleverage in accordance with its strategy.  From its commencement of operations on March 16, 2007 through March 31, 2010, the Series experienced no meaningful periods of illiquidity in any of the markets in which it trades.  For this period , the Series processed redemptions on a monthly basis. The Series incurred redemptions of $1,826,264 (1,591.04 units) and $4,510,736 (3,343.63 units) for the three months ended March 31, 2010 and 2009, respectively, of which $935,899 remained unpaid and is included in redemptions payable to investors in the Series at March 31, 2010.

Capital Resources

The Series’ Units may be offered for sale as of the beginning, and may be redeemed as of the end, of each month.

The amount of capital raised for the Series is not expected to have a significant impact on its operations, as the Series has no significant capital expenditure or working capital requirements other than for monies to pay trading losses, brokerage commissions and charges.  Within broad ranges of capitalization, the Series’ trading positions should increase or decrease in approximate proportion to the size of the Series.

The Series raises additional capital only through the sale of Units and capital is increased through trading profits (if any).  The Series does not maintain any sources of financing other than that made available by the Clearing Broker to fund foreign currency settlements for those instruments transacted and settled in foreign currencies.

The Series may trade a variety of futures-related instruments, including (but not limited to) instruments related to bonds, currencies, interest rates, equities, equity indices, debt securities and selected physical commodities and derivatives.  Risk arises from changes in the value of these contracts (market risk) and the potential inability of counterparties or brokers to perform under the terms of their contracts (credit risk).  Market risk is generally to be measured by the notional amount of the futures positions acquired and the volatility of the markets traded.  The credit risk from counterparty non-performance associated with these instruments is the net unrealized gain, if any, on these positions plus the value of the margin or collateral held by the counterparty.  The risks associated w ith exchange-traded contracts are generally perceived to be less than those associated with over-the-counter transactions, because exchanges typically (but not universally) provide clearinghouse arrangements in which the collective credit (in some cases limited in amount, in some cases not) of the members of the exchange is pledged to support the financial integrity of the exchange.  In over-the-counter transactions, on the other hand, traders must rely

18

solely on the credit of their respective individual counterparties.  Margins that may be subject to loss in the event of a default are generally required in exchange trading, and counterparties may require margin or collateral in the over-the-counter markets.

The Trading Advisor attempts to control risk in all aspects of the investment process, although there can be no assurance that it will, in fact, succeed in doing so. The Series is designed to take market risk on a systematic basis across a broad portfolio of liquid markets and to monitor and minimize exposure to all other risks, such as credit and liquidity risks.  The trading systems used include various proprietary systems that are designed to control the risk taken at the individual position level as well as at the overall portfolio level.  The Trading Advisor monitors and controls market risk within limits at both sector and portfolio levels.

The financial instruments traded by the Series contain varying degrees of off-balance sheet risk whereby changes in the market values of the futures and forward contracts or the Series’ satisfaction of the obligations may exceed the amount recognized in the Consolidated Statements of Financial Condition of the Series.

Due to the nature of the Series’ business, substantially all its assets are represented by cash and U.S. government obligations, while the Series maintains its market exposure through open futures and forward contract positions.

The Series’ futures contracts are settled by offset and are generally cleared by the exchange clearinghouse function.  Open futures positions are marked to market each trading day and the Series’ trading accounts are debited or credited accordingly.  The Series’ spot and forward currency transactions conducted in the interbank market are settled by netting offsetting positions or payment obligations and by cash payments.

The value of the Series’ cash and financial instruments is not materially affected by inflation. Changes in interest rates, which are often associated with inflation, could cause the value of certain of the Series’ debt securities to decline, but only to a limited extent.  More importantly, changes in interest rates could cause periods of strong up or down market price trends, during which the Series’ profit potential generally increases.  However, inflation can also give rise to markets which have numerous short price trends followed by rapid reversals, in which the Series is likely to suffer losses.

Results of Operations

General

The Trading Advisor manages the assets of the Series pursuant to its Aspect Diversified Program (the “Program”).  The Program is a broadly diversified global trading system that deploys multiple trading strategies that seek to identify and exploit directional moves in market behavior of a broad range of global financial instruments including but not limited to bonds, currencies, interest rates, equities, equity indices, debt securities and selected physical commodities and derivatives.  By maintaining comparatively small exposure to any individual market, the aim is to achieve real diversification.  The Program seeks to maintain positions in a variety of markets.  Market concentration varies according to the strength of signals, volatility and liquidity, among other factors.

The Program employs a fully automated system to collect, process and analyze market data (including current and historical price data) and identify and exploit directional moves, or “trends”, in market behavior, trading across a variety of frequencies to exploit trends over a range of timescales.  Positions are taken according to the aggregate signal and are adjusted to control risk.

The investment objective of the Program is to generate significant medium term capital growth independent of overall movements in traditional stock and bond markets within a rigorous risk management framework.  This investment objective is intended to be achieved via the investment policy for the Program, which is to trade relevant asset classes applying the Program.

The core objectives of the Program are:

(i)           to produce strong medium-term capital appreciation (“medium-term” generally referring to a three- to five-year time period);

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(ii)           to seek and exploit profit opportunities in both rising and falling markets using a disciplined quantitative investment process;

(iii)           to seek non-correlation with the broad bond and stock markets and thereby play a valuable role in enhancing the risk/return profile of traditional investment portfolios; and

(iv)           to minimize risk by operating in a diverse range of markets and sectors using a consistent investment process that adheres to pre-defined and monitored risk limits and determines market exposure in accordance with factors including (but not limited to) market correlation, volatility, liquidity and the cost of market access.

The Series’ account traded pursuant to the Program may experience returns that differ from other Trading Advisor accounts traded pursuant to the same Program due to, among other factors: (a) regulatory constraints on the ability of the Series to have exposure to certain contracts; (b) the Series’ selection of the Clearing Broker, which affects access to markets; (c) the effect of intra-month adjustments to the trading level of the account; (d) the manner in which the account’s cash reserves are invested; (e) the size of the Series’ account; (f) the Series’ functional currency, the U.S. Dollar; and (g) the particular futures contracts traded by the Series’ account.  Additionally, certain markets may not be liquid enough to be traded for the Series’ account.

The investment approach that underpins the Program is proprietary.  The Trading Advisor’s investment philosophy has remained consistent and involves a scientific approach to investment driven by the Trading Advisor’s belief that market behavior is not random but rather contains statistically measurable and predictable price movements and anomalies which, through sophisticated quantitative research and a disciplined approach, can be successfully identified and exploited for profit.

The Program is proprietary and highly confidential to the Trading Advisor.  Accordingly, the description of the Program as contained herein is general only and is not intended to be exhaustive or absolute.

The Trading Advisor was established in 1997 by Anthony Todd, Dr. Eugene Lambert, Martin Lueck and Michael Adam, all of whom were involved in the development of AHL (Adam, Harding and Lueck), now part of Man Group plc, where they advanced the application of systematic quantitative techniques in managed futures investment.  The Trading Advisor has grown to a team of over 100 employees and manages approximately $3.6 billion as of December 31, 2009.  The Trading Advisor is a limited liability company registered in England and Wales, which is regulated in the United Kingdom by the Financial Services Authority.  Since October 1999, the Trading Advisor has been a member of NFA and has been registered with the CFTC as a commodity trading advisor and commodity pool operator.  The Trading Advisor has also been registered with NFA as a principal of its commodity trading advisor subsidiary Aspect Capital Inc. since August 2004.  The Trading Advisor has also been registered with the Securities and Exchange Commission as an investment adviser since October 2003.

The Series commenced trading activities March 16, 2007 with an initial capitalization of $7,760,620, of which $5,000,000 was contributed by the Trading Advisor as seed capital.  On December 31, 2007 the Trading Advisor redeemed the full value of its seed capital.  As of March 31, 2010, the Series had a capitalization of $61,712,630 based on the net asset value for all other purposes, as defined.

Performance Summary

Quarter ending March 31, 2010

This performance description is a brief summary of how the Series performed during the quarter ending March 31, 2010, and not necessarily an indication of how it will perform in the future. In addition, the general causes to which certain price movements are attributed may or may not in fact have caused such movements, but simply may have occurred at or about the same time. The Series’ past results are not necessarily indicative of future results.

The Series ended March 31, 2010 with a year-to-date return of 2.76%, based on the net asset value for all other purposes (see “Notes to Consolidated Financial Statements – (3) Related Party Transactions”).

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January 1, 2010 to March 31, 2010

The Series posted a 3.47% return for the month ending March 31, 2010, a gain of 2.76% for the three months ended March 31, 2010 and an overall gain of 17.08% for the Series from the inception of trading on March 16, 2007 (not annualized and based on net asset value per unit for all other purposes).

The Series finished March with a net return of 3.47%. Data releases pointing to economic recovery drove the prices of risky assets higher, despite some continued concerns about European sovereign debt mid-month. Consequently, global stock markets rallied, producing good profits for the Series, and bond markets sold off. Japanese Government Bonds were the Series’ worst performer. In currencies, emerging market and commodity currencies strengthened against the USD to the benefit of the Series’ positions, while European interest rate markets were buoyed by concerns over Greece and poor economic data out of the UK. Commodities markets generally followed the direction of stock markets and finished the month higher. In energies, this resulted in positive performance on long positions in the oil complex, but the Series also profit ed on the short side from the decline in the natural gas price following milder weather in the US and a build-up in inventories. In agricultural commodities, positive performance on short positions in corn and wheat was more than offset by losses in sugar and coffee. The sugar losses were incurred early in the month when prices fell to 11-week lows as the supply outlook improved. Good profits were seen in industrial metals, especially Nickel which reached 22-month highs.

The Series posted a 2.27% return for the month ending February 28, 2010, a 0.69% loss for the year to date as of February 28, 2010 and an overall gain of 13.15% for the Series from the inception of trading on March 16, 2007 to February 28, 2010 (not annualized).

The Series finished February with a positive return of 2.27%. The month of February was, to a large degree, dominated by news-flow relating to the debt crisis within the Euro-zone. The prevailing macroeconomic sentiment oscillated between risk aversion and inflationary concerns with the former being marginally dominant over the calendar month. As a result the Series saw profits from the long positions in both short-term interest rate futures contracts and some bond markets. Positive performance was also seen in other sectors with the long positions in energy contracts benefiting from the further upward move in prices during the middle of the month and the weakness of the Euro and British Pound providing opportunity for profits in the currencies sector. Smaller positive contributions were seen from the small long exposures in both stock indices and metals; the price action in each of these sectors were similar as a sell-off at the beginning of the month was followed by a recovery during the remainder of the month as risk aversion fears dominated. The largest negative performance was seen in agricultural commodities. The longer-term bull market in Sugar reversed sharply from multi-year highs as output in both Brazil and India rose.

The Series posted a 2.89% loss for the month of January 2010 and an overall gain of 10.64% for the Series from the inception of trading on March 16, 2007 to January 31, 2010 (not annualized).

The Series finished January with a loss of 2.89%. After positive performance in the first two weeks of the year, a reversal in investor risk appetite was the primary factor resulting in a loss for the calendar month. The change in sentiment was driven, in part, by disappointing earnings announcements and fears over potential monetary tightening in China as the People’s Bank of China increased banks’ reserve requirements and introduced measures aimed at curbing lending.

As a result the Series’ long positions in stock indices and the net short exposure to the US Dollar saw losses.  Long positions in fixed income markets benefited from the move toward risk aversion, some UK data and comments by both the Bank of England and the European Central Bank. In addition, the strengthening US Dollar and poorer growth outlook also resulted in many commodities markets selling off. This was particularly detrimental to the Series’ long positioning in the oil complex and industrial metals. Oil prices faced additional downward pressure due to an increase in inventories and milder weather in the Unites States. In agriculturals, gains on the long exposure to sugar markets, whose price rallied due to supply concerns, more than offset losses on long positions in the soy complex and cotton.

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Quarter ending March 31, 2009

This performance description is a brief summary of how the Series performed during the quarter ending March 31, 2009, and these results are not necessarily indicative of future results.  In addition, the general causes to which certain price movements are attributed may or may not in fact have caused such movements, but simply may have occurred at or about the same time.

The Series ended March 31, 2009 with a year-to-date loss of 2.95%, based on the net asset value for all other purposes (see “Notes to Consolidated Financial Statements – (3) Related Party Transactions”).

January 1, 2009 to March 31, 2009

The Series posted a 3.62% loss for the month ending March 31, 2009, a 2.95% loss for the three months ended March 31, 2009 and an overall gain of 30.40% for the Series from the inception of trading on March 16, 2007 to March 31, 2009 (not annualized).

The Series experienced challenging market conditions in March, posting a 3.62% loss for the month. Although most global stock markets remain in negative territory year to date, many saw a strong rally during March, to the detriment of the Series’ short positions. Investor risk appetite appeared to return following some positive corporate earnings news and the U.S. Federal Reserve’s revamped toxic asset repurchase and quantitative easing plans. The S&P 500 had its strongest monthly rally since October 2002, recovering from a 12-year low on March 9, 2009.  The Federal Reserve’s plan to repurchase debt caused U.S. fixed income markets to rally. U.S. interest rate markets and European fixed income markets followed and the Series’ long positions performed positively in fixed income sectors. In currencie s, the announcement of the Treasury’s new plans resulted in the U.S. Dollar weakening against major currencies and consequently a give-back of some of the profits the Series had generated on the back of U.S. Dollar strength since the third quarter of 2008.  U.S. Dollar weakness and revised inflationary expectations caused commodities markets to rally to the detriment of the Series’ short positions.  This was seen particularly in metals, where strategic buying by China caused the prices of base metals to rally.  Precious metals on the other hand declined as investors sold out of safe haven assets, contrary to the Series’ long positioning.  Energy markets followed stock markets' direction, with crude oil prices rising over 10% this month, despite OPEC announcing that it would not cut output.

The Series posted a 0.50% gain for the month of February 2009, a 0.70% gain for the year to date as of February 28, 2009 and an overall gain of 35.30% for the Series from the inception of trading on March 16, 2007 to February 28, 2009 (not annualized).

The Series performed positively during February 2009, posting an monthly return of 0.50%.  In comparison with prior months, returns were relatively muted overall.  The Series however still made profits in the majority of sectors.  The currencies sector had an eventful month and provided the most volatility; profits were seen from weakness in the Swedish Krona and Canadian Dollar which offset losses in the Yen against the U.S. Dollar.  The Swedish Krona fell to a record low against the Euro after an unexpectedly large rate-cut and the worst Swedish GDP figures since 1940.  The best performing sectors overall were stock indices and energies.  Global equity markets continued their poor start to the year amid further weak economic data and problems for financial companies, which b enefited the Series’ small short exposure.  In energies, it was short positions in natural gas and products of crude oil which drove performance in a choppy month for crude itself.  Agricultural commodities were also profitable, despite some losses from a sharp reversal in cocoa markets.  Fixed income markets were more mixed.  The longer end of the curve was generally profitable, with the exception of Australian bonds, however performance was dragged down by losses in shorter-dated Australian bills and especially in short Sterling, as quantitative easing started to seem more likely than further rate-cuts in the UK.

The Series posted a 0.20% gain for the month of January 2009 and an overall gain of 34.63% for the Series from the inception of trading on March 16, 2007 to January 31, 2009 (not annualized).

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The Series performed positively during January 2009, posting a monthly return of 0.20%.  The muted contributions from several sectors reflect the systematic reduction in exposures resulting from the increased market volatility experienced in the 4th quarter of 2008. Stock markets started 2009 with renewed investor optimism in response to President Obama’s stimulus plan. The optimism was short-lived however, and stock markets declined as economic and earnings data continued to show a negative outlook. Bonds also sold off and yields rose as governments continued to develop rescue plans and packages to boost growth.  This was particularly seen in European bond markets with UK Gilts and Bunds being two of the worst contracts this month. Conversely, the Series’ long positions in interest rates benefitted from the rate cut decisions of the Bank of England and the ECB. In currencies, the U.S. Dollar continued strengthening as a result of risk aversion and the increasingly negative outlook for Europe, which continues to deal with crises in the financial sector; this effect continued to be particularly seen in the weakness of Sterling to the benefit of the Series’ short exposure. The energies sector was the best performer this month, driven by gains from crude oil and natural gas, whose prices declined on the back of bearish inventory data. Similarly, industrial metals also declined due to stock build-ups, benefiting the Series’ short positions.

Variables Affecting Performance

The principal variables that determine the net performance of the Series are gross profitability from the Series’ trading activity and interest income.

The Series’ assets are maintained at the Clearing Broker.  On assets held in U.S. Dollars, the Clearing Broker credits the Series with interest at the prevailing Federal Funds Rate less 50 basis points per annum.  In the case of non-U.S. Dollar instruments, the Clearing Broker lends to the Series all required non-U.S. currencies at a local short-term interest rate plus a spread of up to 100 basis points per annum (at current rates).  For deposits held in non-U.S. currencies, the Clearing Broker credits the local short-term interest rate less a spread of up to 200 basis points per annum (at current rates).

The Series’ management, Sponsor’s and administrative fees and the sales commissions are a constant percentage of the Series’ net asset value for all other purposes.  Brokerage commissions, which are not based on a percentage of the Series’ net assets, are based on the volume of trades executed and cleared on behalf of the Series.  Brokerage commissions are based on the actual number of contracts traded.  The performance fees payable to the Trading Advisor are based on the new net trading profits, if any, generated by the Series, excluding interest income and after reduction for brokerage commissions and certain other fees and expenses.

Most of the instruments traded on behalf of the Series are highly liquid and can generally be closed out immediately, so that unrealized profits can generally be realized quickly if the relevant positions are closed out.

Off-balance Sheet Arrangements

The Series has no applicable off-balance sheet arrangements of the type described in Items 3.03(a)(4) of Regulation S-K.

Item 3:  Quantitative and Qualitative Disclosures About Market Risk

Not applicable; the Series is a smaller reporting company.

Item 4T:  Controls and Procedures

The Sponsor, with the participation of the Sponsor’s principal executive officer and principal financial officer, has evaluated the effectiveness of the design and operation of its disclosure controls and procedures with respect to the Series as of the end of the fiscal quarter for which this Quarterly Report on Form 10-Q is being filed, and, based on their evaluation, have concluded that these disclosure controls and procedures are effective.  The Series changed administrators on January 1, 2009, which resulted in changes to the Sponsor’s internal control over financial reporting with respect to the Series.  None of these changes had a material impact on the internal controls of the Series.

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PART II – OTHER INFORMATION

Item 1:  Legal Proceedings

The Sponsor is not aware of any pending legal proceedings to which either the Series is a party or to which any of its assets are subject.  In addition there are no pending material legal proceedings involving the Sponsor.

Item 1A:  Risk Factors

There are no material changes to the risk factors previously disclosed in the Series’ most recent Form 10-K filed on March 31, 2010.

Item 2:  Unregistered Sales of Equity Securities and Use of Proceeds

(a)           Not applicable; previously filed on Forms 8-K

(b)           Not applicable.

(c) Pursuant to the Platform’s Limited Liability Company Agreement and the Series’ Separate Series Agreement, Members may redeem their Units at the end of each calendar month at the then current month-end net asset value per Unit for all other purposes (i.e. including the amortization of organizational and initial offering costs).  The redemption of Units has no impact on the value of Units that remain outstanding, and Units are not reissued once redeemed.  The following table summarizes the redemptions by Members during the first quarter of 2010:

Month	Units Redeemed		Redemption Date Net Asset Value per Unit for All Other Purposes
January 31, 2010		216.50		1,106.444
February 28, 2010		575.17		1,131.540
March 31, 2010		799.36		1,170.792
Total		1,591.04

Item 3:  Defaults Upon Senior Securities

(a)           None.

(b)           None.

Item 4:  Submission of Matters to a Vote of Security Holders

None.

Item 5:  Other Information

(a)           None.

(b)           Not applicable.

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Item 6: Exhibits

The following exhibits are included herewith.

Exhibit Number	Description of Document
**1.1	Selling Agreement.
*3.1	Certificate of Formation of AlphaMetrix Managed Futures LLC.
****4.1	Amended and Restated Limited Liability Company Operating Agreement
****4.2	Amended and Restated Separate Series Agreement for the Series.
****10.1	Advisory Agreement.
****10.2	Representation Letter.
*10.4	Form of Customer Agreement.
**10.5	Form of Subscription Agreement.
***10.6	Assignment Agreement
****10.7	General Assignment and Assumption Agreement
*****21.1	List of Subsidiaries
31.1	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.2	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
32.1	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

* Incorporated by reference to the Series’ Form 10/A previously filed on November 2, 2006.

** Incorporated by reference to the Series’ Form 10/A previously filed on January 30, 2007.

*** Incorporated by reference to the Series’ Form 8-K previously filed on October 1, 2008.

**** Incorporated by reference to the Series’ Form 8-K previously filed on November 6, 2008.

***** Incorporated by reference to the Series’ Form 10-K previously filed on March 31, 2010.

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SIGNATURES

Pursuant to the requirements of Section 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 on the 14th day of May, 2010.

Dated: May 14, 2010

ALPHAMETRIX MANAGED FUTURES LLC (ASPECT SERIES)

By:  AlphaMetrix, LLC.

Sponsor

By: /s/ Aleks Kins

Name:�� Aleks Kins

Title:  President and Chief Executive Officer

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