Note 7: Trading Activities and Related Risks

12 Months Ended

Dec. 31, 2011

Derivative Instruments and Hedging Activities:

Derivative Instruments and Hedging Activities Disclosure

7. Trading Activities and Related Risks

	The Fund is engaged in speculative trading of U.S. and foreign futures contracts. The Fund is exposed to both market risk, the risk arising from changes in market value of the contracts, and credit risk, the risk of failure by another party to perform according to the terms of a contract.

	A certain portion of cash in trading accounts are pledged as collateral for futures trading on margin. 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.

	Each U.S. commodity exchange with the approval of the CFTC establishes minimum margin requirements for each traded contract. The FCM may increase the margin requirements above these minimums for any or all contracts. The Fund maintains cash, cash equivalents and U.S. Treasury Bills to satisfy these margin requirements. At December 31, 2011 and December 31, 2010 these totaled $5,674,540 and $10,711,550, respectively. Based upon the types and amounts of contracts traded and the amount of liquid assets of the Fund, the General Partner believes there is minimal risk of not being able to meet its margin requirement.

	Trading in futures contracts involves entering into contractual commitments to purchase or sell a particular futures contracts at a specified date and price. The gross or face amount of the contract, which is typically many times that of the Fund's net assets being traded, significantly exceeds the Fund's future cash requirements since the Fund intends to close out its open positions prior to settlement. As a result, the Fund is generally subject only to the risk of loss arising from the change in the value of the contracts. The market risk is limited to the gross or face amount of the contracts held of approximately $15,096,202 and $47,695,198 on long positions at December 31, 2011 and December 31, 2010, respectively. However, when the Fund enters into a contractual commitment to sell commodities, it must make delivery of the underlying commodity at the contract price and then repurchase the contract at prevailing market prices or settle in cash. Since the repurchase price to which a commodity can rise is unlimited, entering into commitments to sell commodities exposes the Fund to unlimited potential risk.

	Market risk is influenced by a wide variety of factors including government programs and policies, political and economic events, the level and volatility of interest rates, foreign currency exchange rates, the diversification effects among the derivative instruments the Fund holds and the liquidity and inherent volatility of the markets in which the Fund trades.

	The net unrealized gains on open futures contracts at December 31, 2011 and December 31, 2010 were $113,800 and $647,664 respectively.

	Open contracts generally mature within three months of December 31, 2011. The latest maturity for open futures contracts is in March 2012. However, the Fund intends to close all contracts prior to maturity.
	The following tables disclose the fair values of derivative and hedging activities in the Statements of Assets and Liabilities and the Statements of Operations.


Derivative Instruments
Statement of Assets and Liabilities

		Statement of Assets and Liabilities Location	Asset Derivatives at December 31, 2011Fair Value	Liability Derivatives at December 31, 2011Fair Value	Net
Derivatives not designated as hedge instruments under ASC 815	Futures contracts	Net unrealized gain on open futures contracts	$ 122,163	$ (8,363)	$ 113,800

		Statement of Assets and Liabilities Location	Asset Derivativesat December 31, 2010Fair Value	Liability Derivativesat December 31, 2010Fair Value	Net
Derivatives not designated as hedge instruments under ASC 815	Futures contracts	Net unrealized gain on open futures contracts	$ 651,883	$ (4,219)	$ 647,664

Derivative Instruments
Statement of Operations

			For the Years Ended December 31,
		Line Item in the Statement of Operations	2011	2010	2009
Derivatives not designated as hedge instruments under ASC 815	Futures contracts	Net realized gain (loss) from investments and foreign currency transactions	$ (815,380)	$ 811,949	$ (2,898,444)

Derivatives not designated as hedge instruments under ASC 815	Futures contracts	Net unrealized appreciation (depreciation) on investments	$ (533,864)	$ 647,664	$ -

Credit risk is the possibility that a loss may occur due to the failure of a counter party to perform according to the terms of a contract.

The Fund has a substantial portion of its assets on deposit with financial institutions. In the event of a financial institution's insolvency, recovery of Fund deposits may be limited to account insurance or other protection afforded deposits.

The Fund has established procedures to actively monitor market risk and minimize credit risk although there can be no assurance that it will succeed. The basic market risk control procedures consist of continuously monitoring open positions, diversification of the portfolio and maintenance of a desirable margin-to-equity ratio. The Fund seeks to minimize credit risk primarily by depositing and maintaining its assets at financial institutions and brokers which it believes to be creditworthy.

- Definition

The entire disclosure for the entity's entire derivative instruments and hedging activities. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items.

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+ Details

ATLAS FUTURES FUND LIMITED PARTNERSHIP 10-K/A