FIDELITY
CONGRESS STREET
FUND
SEMIANNUAL REPORT
JUNE 30, 1999
(2_FIDELITY_LOGOS)(registered trademark)
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over
time.
FUND TALK 6 The manager's review of fund
performance, strategy and
outlook.
INVESTMENT CHANGES 8 A summary of major shifts in
the fund's investments over
the past six months.
INVESTMENTS 9 A complete list of the fund's
investments with their
market values.
FINANCIAL STATEMENTS 12 Statements of assets and
liabilities, operations, and
changes in net assets, as
well as financial highlights.
NOTES 16 Footnotes to the financial
statements.
Standard & Poor's, S&P and S&P 500 are registered service marks of The
McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity
Distributors Corporation.
Other third party marks appearing herein are the property of their
respective owners.
All other marks appearing herein are registered or unregistered
trademarks or service marks of FMR Corp. or an affiliated company.
This report is printed on recycled paper using soy-based inks.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL INFORMATION
OF THE SHAREHOLDERS OF THE FUND.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-8888 FOR A
FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
After much speculation about the U.S. Federal Reserve Board's
near-term monetary policy, stock and bond investors breathed a sigh of
relief when the Fed shifted to a neutral position on rates following
its widely anticipated quarter-point increase in short-term rates on
June 30. This switch in bias helped the S&P 500(registered trademark)
and NASDAQ soar to record-closing highs, and sent yields on the
bellwether 30-year Treasury back below 6%.
While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.
First, investors are encouraged to take a long-term view of their
portfolios. If you can afford to leave your money invested through the
inevitable up and down cycles of the financial markets, you will
greatly reduce your vulnerability to any single decline. We know from
experience, for example, that stock prices have gone up over longer
periods of time, have significantly outperformed other types of
investments and have stayed ahead of inflation.
Second, you can further manage your investing risk through
diversification. A stock mutual fund, for instance, is already
diversified, because it invests in many different companies. You can
increase your diversification further by investing in a number of
different stock funds, or in such other investment categories as
bonds. If you have a short investment time horizon, you might want to
consider moving some of your investment into a money market fund,
which seeks income and a stable share price by investing in
high-quality, short-term investments. Of course, it's important to
remember that an investment in a money market fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although money market funds seek to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in these types of funds.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases. Of course, you should
consider your financial ability to continue your purchases through
periods of low price levels before undertaking such a strategy.
If you have questions, please call us at 1-800-544-8888, or visit our
web site at www.fidelity.com. We are available 24 hours a day, seven
days a week to provide you the information you need to make the
investments that are right for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value).
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JUNE 30, 1999 PAST 6 MONTHS PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
FIDELITY CONGRESS STREET 10.04% 23.23% 218.13% 413.76%
S&P 500 (registered trademark) 12.38% 22.76% 241.86% 459.06%
Growth & Income Funds Average 10.93% 14.48% 169.53% 316.86%
</TABLE>
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, six months, one year, five
years or 10 years. For example, if you had invested $1,000 in a fund
that had a 5% return over the past year, the value of your investment
would be $1,050. You can compare the fund's returns to the performance
of the Standard & Poor's 500 Index - a market capitalization-weighted
index of common stocks. To measure how the fund's performance stacked
up against its peers, you can compare it to the growth & income funds
average, which reflects the performance of mutual funds with similar
objectives tracked by Lipper Inc. The past six months average
represents a peer group of 922 mutual funds. These benchmarks include
reinvested dividends and capital gains, if any, and exclude the effect
of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JUNE 30, 1999 PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
FIDELITY CONGRESS STREET 23.23% 26.04% 17.78%
S&P 500 22.76% 27.87% 18.78%
Growth & Income Funds Average 14.48% 21.72% 15.13%
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year. (Note: Lipper calculates average annual total
returns by annualizing each fund's total return, then taking an
arithmetic average. This may produce a different figure than that
obtained by averaging the cumulative total returns and annualizing the
result.)
$10,000 OVER 10 YEARS
Congress Street S&P 500
00024 SP001
1989/06/30 10000.00 10000.00
1989/07/31 11056.73 10903.00
1989/08/31 11062.57 11116.70
1989/09/30 11016.83 11071.12
1989/10/31 11018.78 10814.27
1989/11/30 11308.75 11034.88
1989/12/31 11633.31 11299.72
1990/01/31 10714.47 10541.51
1990/02/28 10865.28 10677.49
1990/03/31 11305.72 10960.45
1990/04/30 11118.96 10686.44
1990/05/31 12243.54 11728.36
1990/06/30 12416.03 11648.61
1990/07/31 12457.49 11611.33
1990/08/31 11444.39 10561.67
1990/09/30 10821.57 10047.32
1990/10/31 10902.45 10004.11
1990/11/30 11552.57 10650.38
1990/12/31 11932.95 10947.52
1991/01/31 12309.05 11424.84
1991/02/28 13207.52 12241.71
1991/03/31 13604.52 12537.96
1991/04/30 13586.76 12568.05
1991/05/31 14080.92 13110.99
1991/06/30 13396.74 12510.51
1991/07/31 14047.76 13093.50
1991/08/31 14555.05 13403.81
1991/09/30 14367.99 13179.97
1991/10/31 14738.95 13356.58
1991/11/30 14325.72 12818.31
1991/12/31 15819.73 14284.73
1992/01/31 15450.91 14019.03
1992/02/29 15416.60 14201.28
1992/03/31 15092.81 13924.35
1992/04/30 15357.63 14333.73
1992/05/31 15350.13 14403.97
1992/06/30 15013.85 14189.35
1992/07/31 15679.39 14769.69
1992/08/31 15429.00 14466.91
1992/09/30 15360.71 14637.62
1992/10/31 15279.42 14688.85
1992/11/30 15676.14 15189.74
1992/12/31 15722.61 15376.58
1993/01/31 15521.31 15505.74
1993/02/28 15720.41 15716.62
1993/03/31 15929.42 16048.24
1993/04/30 15723.71 15659.87
1993/05/31 16211.02 16079.56
1993/06/30 16075.40 16126.19
1993/07/31 15851.70 16061.68
1993/08/31 16439.33 16670.42
1993/09/30 16223.42 16542.06
1993/10/31 16801.04 16884.48
1993/11/30 16775.44 16724.08
1993/12/31 16988.42 16926.44
1994/01/31 17217.62 17501.94
1994/02/28 17052.78 17027.63
1994/03/31 16316.66 16285.23
1994/04/30 16323.43 16493.68
1994/05/31 16693.75 16764.18
1994/06/30 16149.74 16353.45
1994/07/31 16788.64 16889.85
1994/08/31 17614.99 17582.33
1994/09/30 17418.40 17151.56
1994/10/31 17881.29 17537.47
1994/11/30 17587.56 16898.76
1994/12/31 17983.47 17149.37
1995/01/31 18501.96 17594.05
1995/02/28 19137.60 18279.69
1995/03/31 19560.97 18819.12
1995/04/30 20284.76 19373.35
1995/05/31 21010.88 20147.70
1995/06/30 21545.43 20615.73
1995/07/31 22069.01 21299.35
1995/08/31 22005.61 21352.81
1995/09/30 23203.04 22253.90
1995/10/31 23494.18 22174.45
1995/11/30 24315.94 23147.91
1995/12/31 24931.18 23593.74
1996/01/31 25964.98 24396.87
1996/02/29 26198.80 24623.03
1996/03/31 26538.26 24860.15
1996/04/30 26848.05 25226.59
1996/05/31 27739.42 25877.18
1996/06/30 28016.72 25975.77
1996/07/31 26946.71 24828.16
1996/08/31 27266.63 25351.79
1996/09/30 28690.11 26778.59
1996/10/31 28895.01 27517.14
1996/11/30 30960.74 29597.16
1996/12/31 30496.59 29010.84
1997/01/31 32135.47 30823.44
1997/02/28 32643.47 31065.10
1997/03/31 31603.29 29788.63
1997/04/30 32915.61 31567.01
1997/05/31 34585.94 33488.81
1997/06/30 36035.06 34989.11
1997/07/31 37968.64 37773.19
1997/08/31 35313.77 35657.14
1997/09/30 37254.66 37610.08
1997/10/31 34971.40 36353.90
1997/11/30 36943.97 38036.73
1997/12/31 37452.12 38689.82
1998/01/31 38415.99 39117.73
1998/02/28 40386.70 41938.90
1998/03/31 41550.71 44086.59
1998/04/30 41734.89 44530.10
1998/05/31 40632.27 43764.63
1998/06/30 41691.61 45542.35
1998/07/31 41504.94 45057.32
1998/08/31 37235.02 38542.93
1998/09/30 39690.16 41011.99
1998/10/31 42463.01 44347.91
1998/11/30 45256.87 47035.84
1998/12/31 46689.65 49746.04
1999/01/31 46922.27 51826.42
1999/02/28 46397.33 50215.65
1999/03/31 47694.75 52224.78
1999/04/30 49862.92 54247.45
1999/05/31 48926.24 52966.67
1999/06/30 51376.40 55906.32
IMATRL PRASUN SHR__CHT 19990630 19990714 100859 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Fidelity Congress Street Fund on June 30, 1989. As the
chart shows, by June 30, 1999, the value of the investment would have
grown to $51,376 - a 413.76% increase on the initial investment. For
comparison, look at how the Standard & Poor's 500 Index did over the
same period. With dividends and capital gains, if any, reinvested, the
same $10,000 would have grown to $55,906 - a 459.06% increase.
(checkmark)UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
long-term growth and
short-term volatility. In turn, the
share price and return of a
fund that invests in stocks will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Signs of continued strength and
emerging inflationary pressures
in the U.S. economy bred investor
uncertainty, which induced stock
markets to give back some of their
gains early, yet bulls won the battle
of wills over their bearish
counterparts as domestic equity
markets surged to a strong finish, for
the six-
month period that ended June 30,
1999. The Dow Jones Industrial
Average - an index of 30
blue-chip stocks - locked in a
healthy return of 20.39% for the
period. The technology-laden
NASDAQ returned 22.70%,
while the Standard & Poor's 500
Index posted a return of 12.38%.
The overall market's sudden
rotation to economically sensitive
cyclical and out-of-favor value stocks
marked much of April and May.
This movement away from
large-company growth stocks and
the subsequent broadening of the
market was reflected in the rebound
of the small-cap universe, as
portrayed by the Russell 2000
Index, which handily outpaced the
larger-cap constituents of the S&P
500 by a total of 8.50% in the
second quarter. However,
indications of a moderating economy
and stronger earnings growth late
in the period fueled a rally in
growth stocks and helped them
regain center stage in June.
Generally wary investors warmly
applauded the Federal Reserve
Board's June 30 decision to
abandon its bias toward raising
interest rates and to limit its
pre-emptive strike against inflation
to a single quarter-point hike.
(photograph of Tim Heffernan)
An interview with Tim Heffernan, Portfolio Manager of Fidelity
Congress Street Fund
Q. HOW DID THE FUND PERFORM, TIM?
A. For the six months that ended June 30, 1999, the fund posted a
total return of 10.04%, trailing the 12.38% return for the Standard &
Poor's 500 Index and the 10.93% return for the growth & income funds
average, as tracked by Lipper Inc. During the 12-month period that
ended June 30, 1999, the fund returned 23.23%, outpacing the S&P 500
index and the Lipper growth & income funds average, which returned
22.76% and 14.48%, respectively.
Q. WHAT FACTORS CAUSED THE FUND TO TRAIL THE INDEX AND THE LIPPER
AVERAGE DURING THE SIX-MONTH PERIOD?
A. A significant detractor was the fund's underweighted position in
technology stocks relative to the S&P 500 index. Stocks such as
Microsoft, America Online and Cisco, which the fund did not own,
continued to drive the impressive returns of the index with their
compelling growth outlooks. Other detractors from relative performance
were the fund's overweighted position in health care and consumer
non-cyclical stocks, which suffered primarily from concerns about weak
sales results, as well as the market's rotation out of growth and
non-cyclical stocks and into cyclical and value-oriented investments.
Q. WHICH STOCKS PERFORMED WELL FOR THE FUND DURING THE PERIOD?
A. While the fund was underweighted in technology stocks relative to
the index, total return did receive a boost from companies such as
Hewlett-Packard, IBM and capital goods manufacturer United
Technologies. Hewlett-Packard experienced healthy growth in its
customer support and outsourcing services, its Asian business improved
and it beat earnings estimates. Shares of IBM and United Technologies
continued to move upward as their dominant market positions produced
strong sales and earnings growth. The world's largest and most
comprehensive health care company, Johnson & Johnson, also provided a
positive contribution as consumer growth was higher than expected and
it received approval from the Food and Drug Administration on a number
of new drugs.
Q. WHICH STOCKS DETRACTED FROM THE FUND'S RETURN?
A. As I mentioned earlier, the fund's substantial positions in health
care companies, such as Guidant, Merck and Eli Lilly, all hurt the
fund's performance. These holdings produced lackluster returns as
investors sold off expensive growth stocks in exchange for cyclical
and value investments. In addition, the large-cap pharmaceutical
companies, such as Merck and Eli Lilly, suffered from the perception
that their key products could lose patent protection and increased
competition could put pressure on earnings. Consumer non-cyclical
stocks, such as Campbell Soup, Eastman Kodak, Coca-Cola and Philip
Morris, also detracted from the fund's return.
Q. WHAT'S YOUR OUTLOOK?
A. I am optimistic that the broad market rally we have seen in U.S.
stocks can continue into the second half of the year. However, I think
we will need more encouraging news out of Asia and Latin America to
support what appear to be signs of an economic turnaround in these
countries. I am cautiously optimistic that this turnaround may be the
beginning of a long-term trend and not just a short-term diversion.
The Fed will have to continue to contain inflation, both real and
perceived, without slowing real economic growth. The uncertainty
created by these factors could create market volatility until a more
certain economic picture emerges. Additionally, with long-bond yields
around six percent, there will be a lot of pressure on the market to
deliver on the economic promises of the second quarter.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
INVESTMENT CHANGES
<TABLE>
<CAPTION>
<S> <C> <C>
TOP TEN STOCKS AS OF JUNE 30,
1999
% OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS IN
THESE STOCKS 6 MONTHS AGO
General Electric Co. 7.9 7.7
United Technologies Corp. 7.1 5.8
Hewlett-Packard Co. 6.0 4.3
Merck & Co., Inc. 5.9 6.4
Johnson & Johnson 5.5 5.0
International Paper Co. 5.3 2.8
GTE Corp. 4.8 4.6
Guidant Corp. 4.5 5.6
American Home Products Corp. 4.4 4.8
Motorola, Inc. 4.3 2.9
TOP FIVE MARKET SECTORS AS OF
JUNE 30, 1999
% OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS IN
THESE MARKET SECTORS 6
MONTHS AGO
HEALTH 23.1 25.0
TECHNOLOGY 16.3 12.7
NONDURABLES 14.8 17.3
ENERGY 9.5 9.5
AEROSPACE & DEFENSE 8.7 7.0
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ASSET ALLOCATION (% OF FUND'S
INVESTMENTS)
AS OF JUNE 30, 1999 AS OF DECEMBER 31, 1998
Stocks 96.8% Stocks 96.1%
Short-term Investments 3.2% Short-term Investments 3.9%
Row: 1, Col: 1, Value: 96.8 Row: 1, Col: 1, Value: 96.09999999999999
Row: 1, Col: 8, Value: 3.2 Row: 1, Col: 8, Value: 3.9
</TABLE>
INVESTMENTS JUNE 30, 1999 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
<TABLE>
<CAPTION>
<S> <C> <C> <C>
COMMON STOCKS - 96.8%
SHARES VALUE (NOTE 1)
AEROSPACE & DEFENSE - 8.7%
Boeing Co. 40,513 $ 1,790,168
United Technologies Corp. 112,200 8,043,338
9,833,506
BASIC INDUSTRIES - 5.7%
CHEMICALS & PLASTICS - 0.4%
Eastman Chemical Co. 8,793 455,038
PAPER & FOREST PRODUCTS - 5.3%
International Paper Co. 118,442 5,981,321
TOTAL BASIC INDUSTRIES 6,436,359
ENERGY - 9.5%
OIL & GAS - 9.5%
Chevron Corp. 24,800 2,360,650
Exxon Corp. 52,890 4,079,141
Mobil Corp. 42,445 4,202,055
Union Pacific Resources 8,181 133,453
Group, Inc.
10,775,299
FINANCE - 0.5%
CREDIT & OTHER FINANCE - 0.5%
Citigroup, Inc. 11,250 534,375
HEALTH - 23.1%
DRUGS & PHARMACEUTICALS - 13.1%
American Home Products Corp. 86,059 4,948,393
Lilly (Eli) & Co. 18,236 1,306,154
Merck & Co., Inc. 90,852 6,723,048
Pharmacia & Upjohn, Inc. 32,260 1,832,771
14,810,366
MEDICAL EQUIPMENT & SUPPLIES
- - 10.0%
Guidant Corp. 99,324 5,108,978
Johnson & Johnson 62,654 6,140,092
11,249,070
TOTAL HEALTH 26,059,436
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
INDUSTRIAL MACHINERY &
EQUIPMENT - 8.6%
ELECTRICAL EQUIPMENT - 7.9%
General Electric Co. 79,400 $ 8,972,199
POLLUTION CONTROL - 0.7%
Waste Management, Inc. 14,500 779,375
TOTAL INDUSTRIAL MACHINERY & 9,751,574
EQUIPMENT
MEDIA & LEISURE - 2.9%
PUBLISHING - 2.9%
Knight-Ridder, Inc. 60,000 3,296,250
NONDURABLES - 14.8%
BEVERAGES - 7.0%
Anheuser-Busch Companies, 51,772 3,672,576
Inc.
Coca-Cola Co. (The) 67,698 4,231,125
7,903,701
FOODS - 4.4%
Campbell Soup Co. 58,911 2,731,998
Heinz (H.J.) Co. 42,859 2,148,307
Vlasic Foods International, 5,891 43,078
Inc. (a)
4,923,383
HOUSEHOLD PRODUCTS - 1.3%
Colgate-Palmolive Co. 14,731 1,454,686
TOBACCO - 2.1%
Philip Morris Companies, Inc. 60,000 2,411,250
TOTAL NONDURABLES 16,693,020
TECHNOLOGY - 16.3%
COMPUTER SERVICES & SOFTWARE
- - 3.7%
International Business 32,844 4,245,087
Machines Corp.
COMPUTERS & OFFICE EQUIPMENT
- - 6.0%
Hewlett-Packard Co. 67,200 6,753,600
ELECTRONICS - 4.3%
Motorola, Inc. 51,200 4,851,200
PHOTOGRAPHIC EQUIPMENT - 2.3%
Eastman Kodak Co. 37,637 2,549,907
TOTAL TECHNOLOGY 18,399,794
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TRANSPORTATION - 0.5%
RAILROADS - 0.5%
Union Pacific Corp. 9,660 $ 563,299
UTILITIES - 6.2%
ELECTRIC UTILITY - 1.4%
Consolidated Edison, Inc. 26,264 1,188,446
Potomac Electric Power Co. 14,545 428,168
1,616,614
TELEPHONE SERVICES - 4.8%
GTE Corp. 71,838 5,441,729
TOTAL UTILITIES 7,058,343
TOTAL COMMON STOCKS 109,401,255
(Cost $14,020,618)
CASH EQUIVALENTS - 3.2%
MATURITY AMOUNT
Investments in repurchase $ 3,655,491 3,655,000
agreements (U.S. Treasury
obligations), in a joint
trading account at 4.84%,
dated 6/30/99 due 7/1/99
TOTAL INVESTMENT IN $ 113,056,255
SECURITIES - 100%
(Cost $17,675,618)
</TABLE>
LEGEND
(a) Non-income producing
INCOME TAX INFORMATION
At June 30, 1999, the aggregate cost of investment securities for
income tax purposes was $17,675,618. Net unrealized appreciation
aggregated $95,380,637, all of which was related to appreciated
investment securities.
At December 31, 1998, the fund had a capital loss carryforward of
approximately $940,100 of which $939,700 and $400 will expire on
December 31, 1999 and 2000, respectively.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999 (UNAUDITED)
ASSETS
Investment in securities, at $ 113,056,255
value (including repurchase
agreements of $3,655,000)
(cost $17,675,618) - See
accompanying schedule
Cash 985
Dividends receivable 149,871
TOTAL ASSETS 113,207,111
LIABILITIES
Payable for fund shares $ 3,257
redeemed
Accrued management fee 124,262
Other payables and accrued 26,841
expenses
TOTAL LIABILITIES 154,360
NET ASSETS $ 113,052,751
Net Assets consist of:
Paid in capital $ 17,065,902
Distributions in excess of (58,885)
net investment income
Accumulated undistributed net 665,097
realized gain (loss) on
investments
Net unrealized appreciation 95,380,637
(depreciation) on investments
NET ASSETS, for 275,348 $ 113,052,751
shares outstanding
NET ASSET VALUE, offering $410.58
price and redemption price
per share ($113,052,751
(divided by) 275,348 shares)
STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30,
1999 (UNAUDITED)
INVESTMENT INCOME $ 811,139
Dividends
Interest 89,410
TOTAL INCOME 900,549
EXPENSES
Management fee $ 242,256
Transfer agent fees 43,726
Accounting fees and expenses 30,380
Custodian fees and expenses 2,710
Audit 8,209
Legal 3
Total expenses before 327,284
reductions
Expense reductions (608) 326,676
NET INVESTMENT INCOME 573,873
REALIZED AND UNREALIZED GAIN 1,605,197
(LOSS)
Net realized gain (loss) on
investment securities
Change in net unrealized 8,205,799
appreciation (depreciation)
on investment securities
NET GAIN (LOSS) 9,810,996
NET INCREASE (DECREASE) IN $ 10,384,869
NET ASSETS RESULTING FROM
OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31, 1998
1999 (UNAUDITED)
INCREASE (DECREASE) IN NET
ASSETS
Operations Net investment $ 573,873 $ 1,284,594
income
Net realized gain (loss) 1,605,197 2,475,195
Change in net unrealized 8,205,799 17,498,938
appreciation (depreciation)
NET INCREASE (DECREASE) IN 10,384,869 21,258,727
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (633,482) (1,299,163)
from net investment income
Share transactions
Reinvestment of distributions 128,775 276,827
Cost of shares redeemed (2,085,244) (2,881,579)
NET INCREASE (DECREASE) IN (1,956,469) (2,604,752)
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) 7,794,918 17,354,812
IN NET ASSETS
NET ASSETS
Beginning of period 105,257,833 87,903,021
End of period (including $ 113,052,751 $ 105,257,833
under (over) distribution of
net investment income of
$(58,885) and $724,
respectively)
OTHER INFORMATION
Shares
Issued in reinvestment of 332 784
distributions
Redeemed (5,414) (8,544)
Net increase (decrease) (5,082) (7,760)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED JUNE 30, 1999 YEARS ENDED DECEMBER 31,
(UNAUDITED) 1998 1997 1996 1995 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 375.34 $ 305.02 $ 252.14 $ 210.05 $ 155.04 $ 150.47
period
Income from Investment
Operations
Net investment income 2.07 D 4.50 D 4.57 D 4.48 4.45 4.29
Net realized and unrealized 35.47 70.41 52.81 42.21 55.06 4.38
gain (loss)
Total from investment 37.54 74.91 57.38 46.69 59.51 8.67
operations
Less Distributions
From net investment income (2.30) (4.59) (4.50) (4.60) (4.50) (4.10)
Net asset value, end of $ 410.58 $ 375.34 $ 305.02 $ 252.14 $ 210.05 $ 155.04
period
TOTAL RETURN B, C 10.04% 24.66% 22.81% 22.32% 38.63% 5.86%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 113,053 $ 105,258 $ 87,903 $ 91,346 $ 81,831 $ 61,307
(000 omitted)
Ratio of expenses to average .62% A .64% .65% .67% .67% .60%
net assets
Ratio of expenses to average .62% A .64% .65% .66% E .67% .60%
net assets after expense
reductions
Ratio of net investment 1.08% A 1.34% 1.59% 1.92% 2.42% 2.82%
income to average net assets
Portfolio turnover rate 0% 0% 0% 0% 0% 0%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
E FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
NOTES TO FINANCIAL STATEMENTS
For the period ended June 30, 1999 (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Congress Street Fund (the fund) is registered under the
Investment Company Act of 1940, as amended, as an open-end management
investment company organized as a Massachusetts business trust and is
authorized to issue 3.8 million shares. Shares of the fund are not
currently available for purchase. The financial statements have been
prepared in conformity with generally accepted accounting principles
which require management to make certain estimates and assumptions at
the date of the financial statements. The following summarizes the
significant accounting policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are
readily available are valued at the last sale price, or if no sale
price, at the closing bid price. Securities for which exchange
quotations are not readily available (and in certain cases debt
securities which trade on an exchange) are valued primarily using
dealer-supplied valuations or at their fair value as determined in
good faith under consistently applied procedures under the general
supervision of the Board of Trustees. Short-term securities with
remaining maturities of sixty days or less for which quotations are
not readily available are valued at amortized cost or original cost
plus accrued interest, both of which approximate current value.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, the fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for its fiscal year. The fund intends to retain and
pay federal income taxes at year-end on undistributed net long-term
capital gains. The schedule of investments includes information
regarding income taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend
date. Non-cash dividends included in dividend income, if any, are
recorded at the fair market value of the securities received. Interest
income is accrued as earned. Investment income is recorded net of
foreign taxes withheld where recovery of such taxes is uncertain.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date.
Income and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in
distribution reclassifications, are primarily due to differing
treatments for redemptions in kind and capital loss carryforwards.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Distributions in excess of net investment income and accumulated
undistributed net realized gain (loss) on investments may include
temporary book and tax basis differences which will reverse in a
subsequent period. Any taxable income or short-term gain remaining at
fiscal year end is distributed in the following year.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other
affiliated entities of Fidelity Management & Research Company (FMR),
may transfer uninvested cash balances into one or more joint trading
accounts. These balances are invested in one or more repurchase
agreements for U.S. Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
securities are transferred to an account of the fund, or to the Joint
Trading Account, at a bank custodian. The securities are
marked-to-market daily and maintained at a value at least equal to the
principal amount of the repurchase agreement (including accrued
interest). FMR, the fund's investment adviser, is responsible for
determining that the value of the underlying securities remains in
accordance with the market value requirements stated above.
3. PURCHASES AND SALES OF INVESTMENTS.
Sales of securities, other than short-term securities, aggregated
$2,030,521, which represents the current value of securities delivered
in redemption of fund shares. There were no purchases of securities
during the period.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a
quarterly fee that is computed monthly at an annual rate of .50% of
the fund's average net assets. The management fee is subject to a
reduction to the extent that the monthly average net assets of all
mutual funds advised by FMR exceed $4 billion in any month. The
management fee payable by the fund on its portion of the excess is
reduced by 10%. For the period, the management fee rate was equivalent
to an annualized rate of .45% of average net assets.
TRANSFER AGENT FEES. Fidelity Service Company, Inc. (FSC), an
affiliate of FMR, is the fund's transfer, dividend disbursing and
shareholder servicing agent. FSC receives account fees and asset-based
fees that vary according to account size and type of account. FSC pays
for typesetting, printing and mailing of all shareholder reports,
except proxy statements. For the period, the transfer agent fees were
equivalent to an annualized rate of .08% of average net assets.
ACCOUNTING FEES. FSC maintains the fund's accounting records. The fee
is based on the level of average net assets for the month plus
out-of-pocket expenses.
5. EXPENSE REDUCTIONS.
The fund has entered into arrangements with its custodian and transfer
agent whereby credits realized as a result of uninvested cash balances
were used to reduce a portion of the fund's expenses. During the
period, the fund's custodian and transfer agent fees were reduced by
$82 and $526, respectively, under these arrangements.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a
day.
BY PHONE
Fidelity Automated Service Telephone provides a single toll-free
number to access account balances, positions, quotes and trading. It's
easy to navigate the service, and on your first call, the system will
help you create a personal identification number (PIN) for security.
(PHONE_GRAPHIC)FIDELITY AUTOMATED
SERVICE TELEPHONE
1-800-544-5555
PRESS
1 For mutual fund and brokerage trading.
2 For quotes.*
3 For account balances and holdings.
4 To review orders and mutual
fund activity.
5 To change your PIN.
*0 To speak to a Fidelity representative.
BY PC
Fidelity's Web site on the Internet provides a wide range of
information, including daily financial news, fund performance,
interactive planning tools and news about Fidelity products and
services.
(COMPUTER_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call EarthLink Sprint at
1-800-288-2967, and be sure to ask for registration number SMD004 to
receive a special Fidelity package that includes 30 days of free
Internet access. EarthLink is North America's #1 independent Internet
access provider.
(COMPUTER_GRAPHIC)
FIDELITY ON-LINE XPRESS+(registered trademark)
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity
at 1-800-544-7272 or visit our Web site for more information on how to
manage your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD
AND RETURN WILL VARY AND,
EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS MEANS
THAT YOU MAY HAVE A
GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO ASSURANCE THAT
MONEY MARKET FUNDS WILL BE
ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN INVESTMENT IN A MONEY
MARKET FUND IS NOT INSURED
OR GUARANTEED BY THE U.S. GOVERNMENT. TOTAL RETURNS ARE HISTORICAL AND
INCLUDE CHANGES IN SHARE
PRICE, REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS, AND THE EFFECTS OF
ANY SALES CHARGES.
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
815 East Birch Street
Brea, CA
851 East Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19200 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
950 Northgate Drive
San Rafael, CA
1400 Civic Drive
Walnut Creek, CA
6300 Canoga Avenue
Woodland Hills, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
48 West Putnam Avenue
Greenwich, CT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
29 South Main Street
West Hartford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
90 Alhambra Plaza
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
1907 West State Road 434
Longwood, FL
8880 Tamiami Trail, North
Naples, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
1502 N. Westshore Blvd.
Tampa, FL
GEORGIA
3445 Peachtree Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
ILLINOIS
One North Franklin Street
Chicago, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
3232 Lake Avenue
Wilmette, IL
INDIANA
4729 East 82nd Street
Indianapolis, IN
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
155 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
44 Mall Road
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
29155 Northwestern Hwy.
Southfield, MI
MINNESOTA
7600 France Avenue South
Edina, MN
MISSOURI
700 West 47th Street
Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
150 Essex Street
Millburn, NJ
56 South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
NEW YORK
1055 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
1271 Avenue of the Americas
New York, NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
OREGON
16850 SW 72 Avenue
Tigard, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
6150 Poplar Road
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
4017 Northwest Parkway
Dallas, TX
1155 Dairy Ashford Street
Houston, TX
2701 Drexel Drive
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
19740 IH 45 North
Spring, TX
UTAH
215 South State Street
Salt Lake City, UT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
511 Pine Street
Seattle, WA
WASHINGTON, DC
1900 K Street, N.W.
Washington, DC
WISCONSIN
595 North Barker Road
Brookfield, WI
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and
send you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH1A
Hebron, KY 41048
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6I
400 East Las Colinas Blvd.
Irving, TX 75039-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
400 East Las Colinas Blvd.
Irving, TX 75039-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Robert A. Lawrence, Vice President
Eric D. Roiter, Secretary
Richard A. Silver, Treasurer
Matthew N. Karstetter, Deputy Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
Abigail P. Johnson
* INDEPENDENT TRUSTEES
CST-SANN-0899 82090
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
FIDELITY'S GROWTH AND INCOME FUNDS
Balanced Fund
Congress Street Fund
Convertible Securities Fund
Equity-Income Fund
Equity-Income II Fund
Exchange Fund
Fidelity(registered trademark) Fund
Global Balanced Fund
Growth & Income Portfolio
Growth & Income II Portfolio
Puritan(registered trademark) Fund
Real Estate Investment Portfolio
Utilities Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
Fidelity Automated
Service Telephone 1-800-544-5555
AUTOMATED LINE FOR QUICKEST SERVICE
(2_FIDELITY_LOGOS)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com
