FIDELITY
(registered trademark)
U.S. GOVERNMENT RESERVES
SEMIANNUAL REPORT
MAY 31, 1997
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
and one year.
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 Notes to the financial statements.
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, THE
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:
Through the first five months of 1997, stock and bond markets experienced
the kind of short-term volatility that can affect them from time to time.
After climbing steadily upward for more than two years, stock prices saw a
sharp correction in late March and early April. Returns in the bond market
were essentially stagnant as the Federal Reserve Board implemented a
long-expected increase in short-term interest rates at the end of March.
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. You should also keep money you'll need in
the near future in a more stable investment.
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.
If you have questions, please call us at 1-800-544-8888. 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
To measure a money market fund's performance, you can look at either total
return or yield. 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). Yield measures the income paid by a fund. Since a money market fund
tries to maintain a $1 share price, yield is an important measure of
performance.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED MAY 31, 1997 PAST 6 PAST 1 PAST 5 PAST 10
MONTHS YEAR YEARS YEARS
Fidelity U.S. Government Reserves 2.54% 5.11% 22.89% 71.45%
Government Money Market Funds Average 2.43% 4.91% 22.21% 69.98%
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. To
measure how the fund's performance stacked up against its peers, you can
compare it to the government money market funds average, which reflects the
performance of mutual funds with similar objectives tracked by IBC
Financial Data, Inc. The past six months average represents a peer group of
417 mutual funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MAY 31, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity U.S. Government Reserves 5.11% 4.21% 5.54%
Government Money Market Funds Average 4.91% 4.09% 5.44%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual cumulative return and
show you what would have happened if the fund had performed at a constant
rate each year.
YIELDS
6/3/97 2/25/97 12/3/96 9/3/96 5/28/96
Fidelity U.S. Government 5.22% 4.95% 4.98% 4.97% 4.92%
Reserves
Government Money 4.93% 4.62% 4.73% 4.66% 4.57%
Market Funds Average
5/28/97 2/26/97 12/4/96 8/28/96 5/29/96
2.66% 2.63% 2.63% 2.68% 2.66%
MMDA
Row: 1, Col: 1, Value: 5.22
Row: 1, Col: 2, Value: 4.930000000000001
Row: 1, Col: 3, Value: 2.66
Row: 2, Col: 1, Value: 4.95
Row: 2, Col: 2, Value: 4.619999999999999
Row: 2, Col: 3, Value: 2.63
Row: 3, Col: 1, Value: 4.98
Row: 3, Col: 2, Value: 4.73
Row: 3, Col: 3, Value: 2.63
Row: 4, Col: 1, Value: 4.970000000000001
Row: 4, Col: 2, Value: 4.659999999999999
Row: 4, Col: 3, Value: 2.68
Row: 5, Col: 1, Value: 4.92
Row: 5, Col: 2, Value: 4.57
Row: 5, Col: 3, Value: 2.66
6% -
5% -
4% -
3% -
2% -
1% -
0%
Fidelity
U.S. Government
Reserves
Government
Money Market
Funds Average
MMDA
YIELD refers to the income paid by the fund over a given period. Yields for
money market funds are usually for seven-day periods, expressed as annual
percentage rates. A yield that assumes income earned is reinvested or
compounded is called an effective yield. The chart above shows the fund's
current seven-day yield at quarterly intervals over the past year. You can
compare these yields to the government money market funds average and the
bank money market deposit account (MMDA) average . Figures for the
government money market funds average are from IBC Financial Data, Inc. The
MMDA average is supplied by BANK RATE MONITOR(Trademark).
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT PAST
RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
There are some important
differences between a bank
money market deposit account
(MMDA) and a money market
fund. First, the U.S.
government neither insures
nor guarantees a money
market fund. In fact, there is
no assurance that a money
market fund will maintain a $1
share price. Second, a money
market fund returns to its
shareholders income earned
by the fund's investments after
expenses. This is in contrast to
banks, which set their MMDA
rates periodically based on
current interest rates,
competitors' rates, and internal
criteria.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: Robert Litterst became Portfolio Manager of Fidelity
U.S. Government Reserves on April 1, 1997.
Q. WHAT WAS THE INVESTING ENVIRONMENT LIKE OVER THE PAST SIX MONTHS, BOB?
A. Although it took some time to translate into action, the Federal Reserve
Board had adopted and maintained a bias toward raising short-term interest
rates since its July 1996 Federal Open Market Committee meeting. This
inclination stemmed from the Fed's desire to slow the economy and head off
potential inflation. After slowing in the third quarter of 1996, the
economy began to pick up in the fourth quarter. That strength continued
through the first quarter of 1997. Testifying before Congress in February,
Fed Chairman Alan Greenspan indicated that the Fed might make a pre-emptive
strike against inflation - raising interest rates before statistics showed
any significant increase in prices - because demand was expanding very
rapidly and was raising the risk of future inflation. The Fed followed
through in March, raising the rate banks charge each other for overnight
loans - known as the fed funds rate - by 0.25% to 5.50%. At its May
meeting, however, the Fed chose to keep rates unchanged for two main
reasons. First, early signs showed economic growth slowing from its
first-quarter pace. Second, broad inflation indices remained well-behaved,
showing that inflation was very calm. By not moving in May, the Fed
appeared to shift from a pre-emptive stance to a more reactive one, where
concrete signs of strengthening demand or rising price pressures may be
required for the Fed to act again.
Q. HOW WAS THE FUND MANAGED DURING THIS PERIOD?
A. For most of the period, the fund tended to have a shorter average
maturity than its peers. That was primarily because the fund took a neutral
approach to the outlook for interest rates. In addition, up to 54% of the
fund was invested in variable rate instruments. The yield on these
investments is reset periodically to reflect moves in rates in the
short-term market. They tend to reduce the average maturity of the fund,
but were attractive because they offered a yield advantage. The fund's
position in these securities fell to about 25% at the end of the period
because the supply was limited and the pricing less attractive. More
recently, I've used a barbell strategy - concentrating the fund on either
end of the maturity spectrum - investing in overnight to one-month
securities on the one hand and on agency issues with maturities of one year
on the other. The one-year notes were attractively valued because they
priced in more Fed increases than I felt would occur. The very short-term
securities help to balance the maturity of the portfolio and serve a
defensive purpose that will benefit shareholders if the Fed raises rates
again.
Q. HOW DID THE FUND PERFORM?
A. On May 31, 1997, the fund's seven-day yield was 5.21%, compared to 4.93%
six months ago. The fund's total return for the six months that ended May
31, 1997, was 2.54%, compared to the average total return of 2.43% for the
government money market funds average tracked by IBC Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. It's more uncertain than in the recent past. Signs of slowing economic
activity have reduced market expectations for further Fed tightening, but
opinions are decidedly mixed. Those who favor additional upward adjustments
point to terrific fundamentals underlying the consumer sector that should
support strong growth going forward. Those who favor keeping rates where
they are point to softer data in the second quarter and extremely favorable
inflation statistics. Most economists expect economic growth to match or
exceed the economy's trend rate - currently estimated at about 2.3% - for
the remainder of the year. If this forecast is realized and leads to rising
price pressures, the Fed probably will raise rates at least once more in
the months ahead. If the second quarter slowdown persists, the Fed likely
will leave policy on hold. At this point, the Fed seems to be content to
respond to incoming data pertaining to demand, inflation and labor market
conditions. This data should shape the course of policy in the months to
come.
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.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: income and a stable
$1 share price by investing in
high quality short-term money
market securities issued by
the U.S. government for
government agencies
FUND NUMBER: 050
START DATE: November 3,
1981
TRADING SYMBOL: FGRXX
SIZE: as of May 31, 1997,
more than $1.2 billion
MANGER: Robert Litterst, since
April 1997; manager, several
Fidelity and Spartan taxable
money market funds; joined
Fidelity in 1991
(checkmark)
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
5/31/97 11/30/96 5/31/96
0 - 30 67 65 72
31 - 90 15 20 17
91 - 180 5 10 5
181 - 397 13 5 6
WEIGHTED AVERAGE MATURITY
5/31/97 11/30/96 5/31/96
Fidelity U.S. Government
Reserves 61 days 40 days 42 days
Government
Money Market Funds
Average * 47 days 48 days 49 days
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF MAY 31, 1997 AS OF NOVEMBER 30, 1996
Row: 1, Col: 1, Value: 53.0
Row: 1, Col: 2, Value: 3.0
Row: 1, Col: 3, Value: 44.0
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 1, Value: 60.0
Row: 1, Col: 2, Value: 9.0
Row: 1, Col: 3, Value: 31.0
Row: 1, Col: 4, Value: 0.0
Federal agency
issues 53%
U.S. Treasury
obligations 3%
Repurchase
agreements 44%
Federal agency
issues 60%
U.S. Treasury
obligations 9%
Repurchase
agreements 31%
* SOURCE: IBC'S MONEY FUND REPORT (registered trademark)
INVESTMENTS MAY 31, 1997 (UNAUDITED)
Showing Percentage of Total Value of Investments in Securities
FEDERAL AGENCIES - 52.9%
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
FEDERAL FARM CREDIT BANK - AGENCY COUPONS - 2.3%
4/1/98 6.01% $ 14,000 $ 13,978
4/1/98 6.05 14,000 13,972
27,950
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 2.1%
7/28/97 5.41 25,610 25,396
FEDERAL HOME LOAN BANK - AGENCY COUPONS - 10.7%
6/2/97 5.60(a) 42,000 41,989
6/19/97 5.46(a) 25,000 24,985
6/28/97 5.61(a) 24,000 23,995
3/18/98 5.88 35,000 35,000
6/11/98 5.96 3,500 3,498
129,467
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 1.6%
8/20/97 5.40 5,000 4,942
10/30/97 5.79 15,000 14,646
19,588
FEDERAL HOME LOAN MORTGAGE CORP. - AGENCY COUPONS - 2.8%
3/17/98 5.79 12,000 11,986
4/8/98 6.04 12,000 11,973
4/29/98 6.02 9,550 9,472
33,431
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 7.1%
7/3/97 5.61 7,000 6,966
7/9/97 5.56 8,500 8,451
7/18/97 5.56 38,390 38,115
8/7/97 5.61 32,000 31,670
85,202
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - 20.1%
6/2/97 5.58 (a) 14,000 14,047
6/2/97 5.59 (a) 19,000 19,063
6/2/97 5.67 (a) 45,000 44,989
6/3/97 5.63 (a) 15,000 14,997
6/4/97 5.60 (a) 28,000 27,990
6/9/97 5.46 (a) 23,000 22,990
6/12/97 5.42 (a) 9,000 8,998
6/13/97 5.46 (a) 10,000 9,995
FEDERAL AGENCIES - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - CONTINUED
8/1/97 5.73% (a) $ 28,000 $ 27,997
3/18/98 5.91 11,000 10,976
4/15/98 6.06 14,000 13,986
4/17/98 6.11 13,000 12,980
5/21/98 5.96 14,000 13,980
242,988
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 6.2%
6/13/97 5.35 14,000 13,976
6/17/97 5.37 11,000 10,974
7/17/97 5.56 4,000 3,972
7/28/97 5.35 7,000 6,942
7/30/97 5.41 15,000 14,870
8/7/97 5.61 6,000 5,938
10/14/97 5.60 7,000 6,856
10/24/97 5.78 4,300 4,203
10/30/97 5.78 7,000 6,835
74,566
TOTAL FEDERAL AGENCIES 638,588
U.S. TREASURY OBLIGATIONS - 2.9%
U.S. TREASURY BILLS - 0.8%
3/5/98 5.68 10,000 9,585
U.S. TREASURY NOTES - 2.1%
11/15/97 5.46 25,000 25,187
TOTAL U.S. TREASURY OBLIGATIONS 34,772
MEDIUM-TERM NOTES (A)(B) - 0.2%
Export-Import Bank, U.S. (as guarantor for K.A. Leasing, Ltd.)
6/15/97 5.75 2,777 2,777
REPURCHASE AGREEMENTS - 44.0%
MATURITY AMOUNT VALUE (NOTE 1)
(000S) (000S)
In a joint trading account
(Notes 2 and 3):
(U.S. Government Obligations)
dated 5/30/97 due 6/2/97
At 5.60% $ 343,900 $ 343,740
(U.S. Government Obligations)
dated 4/3/97 due 6/2/97
At 5.59% 35,326 35,000
(U.S. Government Obligations)
dated 5/27/97 due 6/2/97
At 5.53% 45,041 45,000
(U.S. Government Obligations)
dated 5/2/97 due 6/4/97
At 5.55% 15,076 15,000
(U.S. Government Obligations)
dated 5/5/97 due 6/4/97
At 5.57% 52,241 52,000
(U.S. Government Obligations)
dated 5/8/97 due 6/9/97
At 5.60% 22,110 22,000
(U.S. Government Obligations)
dated 5/16/97 due 6/16/97
At 5.60% 19,092 19,000
TOTAL REPURCHASE AGREEMENTS 531,740
TOTAL INVESTMENTS - 100% $ 1,207,877
Total Cost for Income Tax Purposes $ 1,207,877
LEGEND
1. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the next interest rate reset date or, when applicable,
the final maturity date.
2. Restricted securities - investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST (000)
Export-Import Bank
U.S. (as Guarantor for
K.A. Leasing, Ltd.) 7/29/94 $ 2,777
INCOME TAX INFORMATION
At November 30, 1996, the fund had a capital loss carryforward of
approximately $85,000 of which $19,000 and $66,000 will expire on November
30, 2001 and 2003, respectively.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNT) MAY 31, 1997 (UNAUDITED)
ASSETS
Investment in securities, at value (including repurchase $ 1,207,877
agreements of $531,740) - See
accompanying schedule
Receivable for investments sold 9,589
Interest receivable 4,289
TOTAL ASSETS 1,221,755
LIABILITIES
Payable for investments purchased $ 3,498
Share transactions in process 162
Distributions payable 168
Accrued management fee 225
Other payables and accrued expenses 323
TOTAL LIABILITIES 4,376
NET ASSETS $ 1,217,379
Net Assets consist of:
Paid in capital $ 1,217,386
Accumulated net realized gain (loss) on investments (7)
NET ASSETS, for 1,217,822 shares outstanding $ 1,217,379
NET ASSET VALUE, offering price and redemption price per $1.00
share ($1,217,379 (divided by) 1,217,822 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS ENDED MAY 31, 1997 (UNAUDITED)
INTEREST INCOME $ 33,233
EXPENSES
Management fee $ 1,225
Transfer agent fees 1,504
Accounting fees and expenses 71
Non-interested trustees' compensation 4
Custodian fees and expenses 7
Registration fees 49
Audit 8
Legal 3
Miscellaneous 6
Total expenses before reductions 2,877
Expense reductions (45) 2,832
NET INTEREST INCOME 30,401
NET REALIZED GAIN (LOSS) ON INVESTMENTS 18
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 30,419
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED MAY 31, NOVEMBER 30,
1997 1996
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 30,401 $ 59,722
Net interest income
Net realized gain (loss) 18 12
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 30,419 59,734
FROM OPERATIONS
Distributions to shareholders from net interest income (30,401) (59,722)
Share transactions at net asset value of $1.00 per share 811,385 1,718,909
Proceeds from sales of shares
Reinvestment of distributions from net interest income 29,052 56,628
Cost of shares redeemed (865,783) (1,720,835)
NET INCREASE (DECREASE) IN NET ASSETS AND SHARES (25,346) 54,702
RESULTING FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS (25,328) 54,714
NET ASSETS
Beginning of period 1,242,707 1,187,993
End of period $ 1,217,379 $ 1,242,707
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS SIX MONTHS YEARS ENDED TWO MONTHS YEARS ENDED
ENDED NOVEMBER 30, ENDED SEPTEMBER 30,
MAY 31, NOVEMBER 30,
1997 1996 1995 1994 1994 1993 1992
</TABLE>
(UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment Operations .025 .050 .055 .008 .033 .025 .039
Net interest income
Less Distributions
From net interest income (.025) (050) (.055) (.008) (.033) (.025) (.039)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 2.54% 5.12% 5.60% .78% 3.32% 2.57% 3.95%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in millions) $ 1,217 $ 1,243 $ 1,188 $ 1,130 $ 1,060 $ 1,043 $ 1,292
Ratio of expenses to average net assets .48% A .51% .55% .36% A, C .51% .73% .73%
Ratio of expenses to average net assets after .47% A, D .50% .55% .36% A .51% .73% .73%
expense reductions D
Ratio of net interest income to average net assets 5.05% A 5.02% 5.43% 4.77% A 3.27% 2.57% 3.88%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE
TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO THE FINANCIAL STATEMENTS).
C FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE
BEEN HIGHER.
D FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO THE FINANCIAL STATEMENTS).
NOTES TO FINANCIAL STATEMENTS
For the period ended May 31, 1997 (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity U.S. Government Reserves (the fund) is a fund of Fidelity Phillips
Street Trust (the trust) and is authorized to issue an unlimited number of
shares. The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Delaware business trust. The financial statements have been
prepared in conformity with generally accepted accounting principles which
permit 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. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
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 schedule of investments includes information regarding
income taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
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.
2. OPERATING POLICIES - CONTINUED
REVERSE REPURCHASE AGREEMENTS. At all times that a reverse repurchase
agreement is outstanding, the fund identifies cash and liquid securities as
segregated in its custodian records with a value at least equal to its
obligation under the agreement.
RESTRICTED SECURITIES. The fund is permitted to invest in securities that
are subject to legal or contractual restrictions on resale. These
securities generally may be resold in transactions exempt from registration
or to the public if the securities are registered. Disposal of these
securities may involve time-consuming negotiations and expense, and prompt
sale at an acceptable price may be difficult. At the end of the period,
restricted securities (excluding 144A issues) amounted to $2,777,000 or
0.2% of net assets.
3. JOINT TRADING ACCOUNT.
At the end of the period, the fund had 20% or more of its total investments
in repurchase agreements through a joint trading account. These repurchase
agreements were with entities whose creditworthiness has been reviewed and
found satisfactory by FMR. The maturity values of the joint trading account
investments are shown in the schedule of investments.The investments in
repurchase agreements through the joint trading account are summarized as
follows:
SUMMARY OF JOINT TRADING
DATED APRIL 3, 1997 TO JUNE 2, 1997 AT 5.59%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $250,000,000
Aggregate maturity amount of agreements $252,329,167
Aggregate market value of transferred assets $259,780,982
Coupon rates of transferred assets 4.75% to 12.00%
Maturity dates of transferred assets 8/1/97 to 3/1/25
DATED MAY 27, 1997 TO JUNE 2, 1997 AT 5.53%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $185,000,000
Aggregate maturity amount of agreements $185,170,508
Aggregate market value of transferred assets $190,726,388
Coupon rates of transferred assets 5.75% to 10.00%
Maturity dates of transferred assets 2/1/17 to 2/1/35
3. JOINT TRADING ACCOUNT - CONTINUED
SUMMARY OF JOINT TRADING - CONTINUED
DATED MAY 30, 1997 TO JUNE 2, 1997 AT 5.60%
Number of dealers or banks 5
Maximum amount with one dealer or bank 28.8%
Aggregate principal amount of agreements $1,389,006,000
Aggregate maturity amount of agreements $1,389,654,203
Aggregate market value of transferred assets $1,431,419,723
Coupon rates of transferred assets 5.00% to 13.25%
Maturity dates of transferred assets 6/1/97 to 6/1/27
DATED MAY 2, 1997 TO JUNE 4, 1997 AT 5.55%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $100,508,750
Aggregate market value of transferred assets $103,005,756
Coupon rates of transferred assets 4.38% to 7.78%
Maturity dates of transferred assets 8/1/03 to 5/1/36
DATED MAY 5, 1997 TO JUNE 4, 1997 AT 5.57%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $200,000,000
Aggregate maturity amount of agreements $200,928,333
Aggregate market value of transferred assets $207,442,596
Coupon rates of transferred assets 5.75% to 13.00%
Maturity dates of transferred assets 7/1/00 to 2/1/35
DATED MAY 8, 1997 TO JUNE 9, 1997 AT 5.60%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $200,000,000
Aggregate maturity amount of agreements $200,995,556
Aggregate market value of transferred assets $205,658,921
Coupon rates of transferred assets 5.75% to 11.00%
Maturity dates of transferred assets 10/1/99 to 4/15/42
3. JOINT TRADING ACCOUNT - CONTINUED
SUMMARY OF JOINT TRADING - CONTINUED
DATED MAY 16, 1997 TO JUNE 16, 1997 AT 5.60%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $280,000,000
Aggregate maturity amount of agreements $281,350,222
Aggregate market value of transferred assets $288,400,001
Coupon rates of transferred assets 6.09% to 7.97%
Maturity dates of transferred assets 2/1/24 to 5/1/35
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
fee that is calculated by multiplying the sum of two components, a group
fee rate plus a fixed individual fund fee rate, applied to the average net
assets of the fund and adding an income-based fee. The group fee rate is
the weighted average of a series of rates and is based on the monthly
average net assets of all the mutual funds advised by FMR. The rates ranged
from .1100% to .3700% for the period. In the event that these rates were
lower than the contractual rates in effect during the period, FMR
voluntarily implemented the above rates, as they resulted in the same or a
lower management fee. The individual fund fee rate is .03%. The
income-based fee is added only when the fund's gross yield exceeds 5%. At
that time the income-based fee would equal 6% of that portion of the fund's
gross income that represents a gross yield of more than 5% per year. The
maximum income-based component is 0.24% (annualized) of average net assets.
For the period, the management fee was equivalent to an annualized rate of
.20% of average net assets.
SUB-ADVISER FEE. As the fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect.
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
.25% 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 an arrangement with its 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
transfer agent fees were reduced by $45,000 under this arrangement.
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 TouchTone Xpressprovides 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.
SM
(PHONE_GRAPHIC)(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
1
For quotes.*
2
For account balances and holdings.
3
To review orders and mutual
fund activity.
4
To change your PIN.
5
To speak to a Fidelity representative.
*
0
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.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at 1-800-544-7272
for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
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
19100 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
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
4001 Tamiami Trail, North
Naples, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
1502 N. Westshore Blvd.
Tampa, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
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
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 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
10 Bank Street
White Plains, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
1903 East Ninth Street
Cleveland, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
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
VERMONT
199 Main Street
Burlington, VT
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
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
(registered trademark)
INVESTMENT SUB-ADVISER
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Sarah H. Zenoble, Vice President
Robert Litterst, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Thomas D. Maher, Assistant
Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
William O. McCoy *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
Bank of New York
New York, NY
* INDEPENDENT TRUSTEES
FIDELITY'S TAXABLE
MONEY MARKET FUNDS
Fidelity Cash Reserves
Fidelity Daily Income Trust
Fidelity U.S. Government Reserves
Spartan(registered trademark) Money Market Fund
Spartan U.S. Government
Money Market Fund
Spartan U.S. Treasury
Money Market 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)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE
FIDELITY
(registered trademark)
CASH RESERVES
SEMIANNUAL REPORT
MAY 31, 1997
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
and one year.
INVESTMENTS 9 A complete list of the fund's
investments with their market
values.
FINANCIAL STATEMENTS 21 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
NOTES 25 Notes to the financial statements.
REPORT OF INDEPENDENT 27 The auditors' opinion.
ACCOUNTANTS
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, THE
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:
Through the first five months of 1997, stock and bond markets experienced
the kind of short-term volatility that can affect them from time to time.
After climbing steadily upward for more than two years, stock prices saw a
sharp correction in late March and early April. Returns in the bond market
were essentially stagnant as the Federal Reserve Board implemented a
long-expected increase in short-term interest rates at the end of March.
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. You should also keep money you'll need in
the near future in a more stable investment.
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.
If you have questions, please call us at 1-800-544-8888. 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
To measure a money market fund's performance, you can look at either total
return or yield. 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). Yield measures the income paid by a fund. Since a money market fund
tries to maintain a $1 share price, yield is an important measure of
performance.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED MAY 31, 1997 PAST 6 PAST 1 PAST 5 PAST 10
MONTHS YEAR YEARS YEARS
Fidelity Cash Reserves 2.56% 5.18% 23.81% 74.81%
All Taxable Money Market Funds Average 2.46% 4.96% 22.43% 71.92%
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. To
measure how the fund's performance stacked up against its peers, you can
compare it to the all taxable money market funds average, which reflects
the performance of mutual funds with similar objectives tracked by IBC
Financial Data, Inc. The past six months average represents a peer group of
849 mutual funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MAY 31, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity Cash Reserves 5.18% 4.36% 5.74%
All Taxable Money Market Funds Average 4.96% 4.13% 5.51%
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.
YIELDS
6/3/97 2/25/97 12/03/96 9/3/96 5/28/96
5.25% 5.04% 5.00% 4.96% 4.96%
Fidelity Cash Reserves
All Taxable Money 5.00% 4.80% 4.88% 4.83% 4.74%
Market Funds Average
5/28/97 2/26/97 12/4/96 8/28/96 5/29/96
2.66% 2.63% 2.63% 2.68% 2.66%
MMDA
Row: 1, Col: 1, Value: 5.25
Row: 1, Col: 2, Value: 5.0
Row: 1, Col: 3, Value: 2.66
Row: 2, Col: 1, Value: 5.04
Row: 2, Col: 2, Value: 4.8
Row: 2, Col: 3, Value: 2.63
Row: 3, Col: 1, Value: 5.0
Row: 3, Col: 2, Value: 4.88
Row: 3, Col: 3, Value: 2.63
Row: 4, Col: 1, Value: 4.96
Row: 4, Col: 2, Value: 4.83
Row: 4, Col: 3, Value: 2.68
Row: 5, Col: 1, Value: 4.96
Row: 5, Col: 2, Value: 4.74
Row: 5, Col: 3, Value: 2.66
6% -
5% -
4% -
3% -
2% -
1% -
0%
Fidelity Cash
Reserves
All Taxable
Money Market
Funds Average
MMDA
YIELD refers to the income paid by the fund over a given period. Yields for
money market funds are usually for seven-day periods, expressed as annual
percentage rates. A yield that assumes income earned is reinvested or
compounded is called an effective yield. The chart above shows the fund's
current seven-day yield at quarterly intervals over the past year. You can
compare these yields to the all taxable money market funds average and the
bank money market deposit account (MMDA) average. Figures for the all
taxable money market funds average are from IBC Financial Data, Inc. The
MMDA average is supplied by BANK RATE MONITOR.(Trademark)
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT PAST
RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
There are some important
differences between a bank
money market deposit
account (MMDA) and a
money market fund. First, the
U.S. Government neither
insures nor guarantees a
money market fund. In fact,
there is no assurance that a
money fund will maintain a $1
share price. Second, a money
market fund returns to its
shareholders income earned
by the fund's investments
after expenses. This is in
contrast to banks, which set
their MMDA rates periodically
based on current interest
rates, competitors' rates, and
internal criteria.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: John Todd became Portfolio Manager of Fidelity Cash
Reserves on April 1, 1997.
Q. WHAT WAS THE INVESTING ENVIRONMENT LIKE OVER THE PAST SIX MONTHS, JOHN?
A. As we progressed through the fourth quarter of 1996, it became evident
that the Federal Reserve Board was in the midst of a monetary experiment.
By that I mean that the Fed was allowing the economy to grow at a faster
rate without intervening to slow it by raising short-term interest rates -
as long as the inflation outlook remained positive. Through the first
quarter of 1997, we saw the economic momentum that had developed in the
fourth quarter continue to build.
Q. HOW DID THE FED RESPOND?
A. In testimony before both houses of Congress in the first quarter, Fed
Chairman Alan Greenspan repeatedly warned of the risk of inflation picking
up if the Fed failed to respond to an economy growing at too rapid a pace.
Growth in real gross domestic product (GDP) - meaning stated growth minus
inflation - in the first quarter was unusually strong at an annual rate of
5.8% and marked the first time in three years the GDP grew in excess of 3%
in back-to-back quarters. Given this momentum in the economy, the Fed chose
to raise the rate banks charge each other for overnight loans - known as
the fed funds rate - by 0.25% to 5.50% at its March meeting. However, the
consensus forecast and early evidence suggest that growth in the second
quarter will slow dramatically from the torrid first quarter pace. The Fed
apparently agreed and chose not to continue to raise rates at its late May
meeting and appears to be in a holding pattern for now. Some believe that
the Fed has abandoned the notion of being pre-emptive and will only respond
to actual evidence of inflation rather than trying to respond to underlying
inflationary pressures.
Q. WHAT KIND OF STRATEGY DID THE FUND PURSUE?
A. During the fourth quarter of 1996, it appeared prices in money market
securities prematurely reflected an interest rate increase. As a result,
the fund was managed with a longer average maturity than most of its peers,
in the mid-60 days. Because of Greenspan's testimony during the first
quarter of 1997, the fund's maturity was brought in shorter than other
funds - at about 50 days. Once the market adjusted to the new, higher rate
level, and expectations of further Fed interest rate increases were built
into the yield curve, the fund's maturity was extended. That's because many
longer-maturity instruments were attractively valued because their prices
and yields reflected a much more aggressive Fed interest rate posture than
we felt was likely. For the time being, I continue to run the fund with a
longer average maturity than its peers.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on May 31, 1997, was 5.25%, compared to 5.00%
six months ago. For the six months that ended May 31, 1997, the fund had a
total return of 2.56%, compared to 2.46% for the all taxable money market
funds average, according to IBC Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. While I believe it's likely the Fed will continue to raise interest
rates, I don't believe it will do so as aggressively as 1994 and early
1995, when it raised the fed funds rate seven times for a total of 3%.
There are distinct differences between 1994 and the current environment.
First, real short-term rates - meaning stated short-term rates minus
inflation - are at 3% currently, the same level at which the Fed stopped
raising rates in 1995. Second, in 1994 the dollar was weak, whereas it has
been quite strong over the past 12 to 18 months. A strong dollar has a
dampening effect on the economy because it makes American products more
expensive, with overseas demand for American goods suffering as a result.
Third, inflation is not expected to come on strong. Taken together, these
factors offer a real contrast between today's interest rate environment and
that of 1994/1995. While that period saw one of the more dramatic interest
rate cycles in some time, the present situation is less severe. In
addition, the fact that the Fed did not raise rates again in May in part
reflects the intense pressure brought to bear on it both by politicians and
corporate leaders in an environment where inflation seemed to be contained.
Accordingly, I believe interest rates likely will go up, but not to the
same extent as 1994 and early 1995.
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.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: income and a stable
$1 share price by investing in
high quality, short-term
money market securities of
all types
START DATE: May 10, 1979
FUND NUMBER: 055
TRADING SYMBOL: FDRXX
SIZE: as of May 31, 1997,
more than $22.7 billion
MANAGER: John Todd, since
April 1997; manager, Spartan
Money Market Fund, since
1989; Fidelity Select Money
Market Portfolio, since 1991;
short-term and money market
investments for the Fidelity
Asset Manager funds, since
1996; joined Fidelity in 1981
(checkmark)
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
5/31/97 11/30/96 5/31/96
0 - 30 49 44 41
31 - 90 29 27 41
91 - 180 10 25 12
181 - 397 12 4 6
WEIGHTED AVERAGE MATURITY
5/31/97 11/30/96 5/31/96
Fidelity Cash Reserves 67 days 62 days 62 days
All Taxable Money
Market Funds Average* 52 days 53 days 52 days
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF MAY 31, 1997 AS OF NOVEMBER 30, 1996
Row: 1, Col: 1, Value: 62.0
Row: 1, Col: 2, Value: 32.0
Row: 1, Col: 3, Value: 6.0
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 1, Value: 48.0
Row: 1, Col: 2, Value: 32.0
Row: 1, Col: 3, Value: 15.0
Row: 1, Col: 4, Value: 5.0
Bank CDs, BAs,
TDs, and notes 62%
Commercial
paper 32%
Government
securities 6%
Other 0%
Bank CDs, BAs,
TDs, and notes 48%
Commercial
paper 32%
Government
securities 15%
Other 5%
* SOURCE: IBC'S MONEY FUND REPORT (registered trademark)
INVESTMENTS MAY 31, 1997
Showing Percentage of Total Value of Investments in Securities
CERTIFICATES OF DEPOSIT - 41.6%
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
DOMESTIC CERTIFICATES OF DEPOSIT - 1.7%
Chase Manhattan Bank (USA)
7/28/97 5.55% $ 75,000 $ 75,000
CoreStates Bank
6/10/97 5.66 (a) 20,000 19,997
6/11/97 5.66 (a) 25,000 25,000
Mellon Bank, N.A.
6/2/97 5.55 25,000 25,000
Morgan Guaranty Trust, NY
8/12/97 5.80 100,000 99,986
3/19/98 5.95 118,750 118,714
3/20/98 6.00 45,000 44,979
408,676
CHICAGO BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 1.2%
ABN-AMRO Bank
6/27/97 5.55 45,000 45,000
12/23/97 5.70 100,000 99,973
3/19/98 6.00 45,000 44,993
Bank of Montreal
6/24/97 5.38 80,000 80,000
269,966
PORTLAND BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 0.6%
Bank of Nova Scotia
6/10/97 6.02 12,000 12,000
4/1/98 6.20 117,000 116,944
128,944
SAN FRANCISCO BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 0.9%
Banque Nationale de Paris
6/3/97 5.56 105,000 105,000
6/30/97 5.55 105,000 105,001
210,001
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 28.4%
ABN-AMRO Bank
9/10/97 6.10 50,000 49,997
Australia & New Zealand Banking
6/18/97 5.53 50,000 50,000
Bank of Tokyo - Mitsubishi Ltd.
6/3/97 5.53 120,000 120,000
6/4/97 5.53 17,000 17,000
CERTIFICATES OF DEPOSIT - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - CONTINUED
Bank of Tokyo - Mitsubishi Ltd. - continued
7/10/97 5.83% $ 76,000 $ 76,000
8/6/97 5.85 66,000 66,000
8/13/97 5.82 31,000 31,000
8/27/97 5.75 117,000 117,000
8/29/97 5.79 43,000 43,000
Banque Nationale de Paris
6/2/97 5.55 35,000 35,000
6/2/97 5.60 150,000 150,000
7/1/97 5.60 42,000 42,000
9/30/97 5.85 55,000 55,000
Barclays Bank, PLC
6/2/97 5.54 175,000 175,000
1/16/98 5.80 28,000 27,988
Barclays U.S. Funding Corp.
6/27/97 5.55 100,000 100,000
Bayerische Hypotheken - und Weschel
6/23/97 5.55 221,000 221,000
Bayerische Landesbank Girozentrale
9/29/97 5.85 50,000 49,971
2/10/98 5.93 60,000 59,876
Bayerische Vereinsbank A.G.
6/18/97 5.37 163,000 163,000
Caisse Nationale de Credit Agricole
6/16/97 5.50 90,000 90,000
7/21/97 5.60 270,000 270,000
11/13/97 5.86 42,000 42,000
Canadian Imperial Bank of Commerce
6/23/97 5.55 140,000 140,000
Commerzbank, Germany
6/2/97 5.56 70,000 70,000
6/27/97 5.55 128,000 128,000
Den Danske Bank A/S
6/9/97 5.50 25,000 25,000
7/23/97 5.56 25,000 25,000
Deutsche Bank, Germany
9/10/97 6.10 15,000 15,000
10/28/97 5.70 34,000 33,982
1/28/98 5.80 30,000 29,995
4/10/98 6.25 100,000 99,959
4/15/98 6.30 70,000 69,977
Dresdner Bank, A.G., Germany
7/2/97 5.56 70,000 70,000
Landesbank Hessen - Thuringen
7/18/97 5.50 50,000 50,025
9/5/97 6.20 150,000 150,004
4/1/98 6.25 70,000 69,933
CERTIFICATES OF DEPOSIT - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - CONTINUED
National Westminster Bank, PLC
6/17/97 5.50% $ 100,000 $ 100,000
8/5/97 5.50 100,000 100,000
10/14/97 5.94 200,000 200,000
12/19/97 5.92 30,000 29,990
3/3/98 5.80 140,000 139,970
Rabobank Nederland, N.V.
3/20/98 6.00 115,000 114,974
3/20/98 6.10 5,000 4,995
3/24/98 6.05 65,000 64,970
4/10/98 6.25 65,000 64,973
4/10/98 6.26 60,000 59,971
Royal Bank of Canada
8/13/97 5.80 50,000 49,993
8/18/97 5.80 130,000 129,989
3/3/98 5.82 150,000 149,978
Sanwa Bank, Ltd.
6/23/97 5.64 150,000 150,000
7/10/97 5.81 62,000 62,000
8/1/97 5.85 58,000 58,000
8/27/97 5.75 25,000 25,000
Societe Generale, France
6/11/97 5.42 110,000 110,000
7/25/97 5.55 135,000 135,000
7/28/97 5.55 100,000 100,000
8/7/97 5.52 230,000 230,000
11/12/97 5.90 115,000 115,000
12/1/97 5.90 30,000 30,000
Sumitomo Bank, Ltd.
6/6/97 5.58 30,000 30,000
6/23/97 5.83 64,000 64,000
7/29/97 5.75 43,000 43,000
8/4/97 5.75 42,000 42,000
Swiss Bank Corp.
6/23/97 5.49 100,000 100,000
7/21/97 5.62 80,000 80,000
7/22/97 5.53 75,000 75,000
8/4/97 5.50 225,000 225,000
12/22/97 5.96 135,000 135,000
12/22/97 5.99 158,000 158,000
12/30/97 6.04 100,000 100,000
2/27/98 5.88 45,000 45,000
Westdeutsche Landesbank Girozentrale
6/9/97 5.57 130,000 130,000
6/9/97 5.58 170,000 170,000
CERTIFICATES OF DEPOSIT - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - CONTINUED
Westpac Banking Corp.
6/17/97 5.50% $ 25,000 $ 25,000
6,674,510
LONDON BRANCH, EURODOLLAR, FOREIGN BANKS - 8.8%
ABN-AMRO Bank
6/9/97 5.50 39,000 39,000
Abbey National, Treasury Services, PLC
7/22/97 5.60 151,000 151,000
7/24/97 5.40 55,000 55,009
8/20/97 5.44 140,000 140,000
3/4/98 5.87 100,000 100,000
Banco Santander SA
6/30/97 5.57 40,000 40,000
Bank of Nova Scotia
6/30/97 5.55 200,000 200,000
7/23/97 5.60 85,000 85,000
Barclays Bank, PLC
6/5/97 5.56 30,000 30,000
6/23/97 5.55 285,000 285,004
6/27/97 5.55 55,000 55,000
Bayerische Landesbank Girozentrale
6/23/97 5.50 50,000 50,000
Berliner Handels - und Frankfurter Bank
6/4/97 5.45 75,000 75,000
Commerzbank, Germany
6/23/97 5.51 10,000 10,000
Deutsche Bank, Germany
7/2/97 5.56 210,000 210,003
National Westminster Bank, PLC
6/24/97 5.55 16,000 16,000
Royal Bank of Scotland, PLC
8/7/97 5.50 20,000 20,000
Toronto-Dominion Bank
10/6/97 5.88 35,000 35,000
11/24/97 5.85 140,000 140,000
3/3/98 5.87 130,000 130,000
Union Bank of Switzerland
6/16/97 5.60 105,000 104,999
6/19/97 5.60 100,000 100,000
2,071,015
TOTAL CERTIFICATES OF DEPOSIT 9,763,112
COMMERCIAL PAPER - 31.7%
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
ABN-AMRO North America Finance, Inc.
6/19/97 5.50% $ 80,000 $ 79,786
AC Acquisition Holding Company
6/13/97 5.64 60,000 59,888
7/7/97 5.60 10,000 9,944
7/8/97 5.60 58,902 58,565
7/9/97 5.60 20,000 19,883
Abbey National, North America
8/11/97 5.42 74,000 73,229
8/12/97 5.42 35,000 34,630
American Home Products
6/12/97 5.64 20,000 19,966
Asset Securitization Coop. Corp.
6/18/97 5.63 50,000 49,868
Associates Corp. of North America
6/26/97 5.80 135,000 134,464
BBL North America, Inc.
6/2/97 5.57 125,000 124,981
B.B.V. Finance (Delaware), Inc.
7/29/97 5.52 50,000 49,567
10/8/97 5.88 60,000 58,772
BHF Finance (Delaware), Inc.
6/2/97 5.45 10,000 9,999
BMW US Capital Corp.
6/24/97 5.58 45,000 44,840
6/26/97 5.58 50,000 49,807
Bank of New York Company, Inc.
6/2/97 5.57 23,000 22,996
Bear Stearns Cos., Inc.
7/9/97 5.60 64,000 63,624
7/10/97 5.61 43,000 42,741
7/14/97 5.62 73,000 72,514
CIT Group Holdings, Inc.
7/14/97 5.59 110,000 109,271
Caisse d'Amortissement de la Dette Sociale
6/3/97 6.01 255,000 254,919
6/20/97 5.50 100,000 99,717
Caisse des Depots et Consignations
6/18/97 5.63 200,000 199,471
6/25/97 5.54 70,000 69,742
Chase Manhattan Corp.
12/1/97 5.85 110,000 106,824
Chrysler Financial Corporation
6/16/97 5.65 42,000 41,902
6/23/97 5.75 42,000 41,853
Citibank Credit Card Master Trust I (Dakota Certificate Program)
6/6/97 5.60 41,000 40,968
6/16/97 5.57 16,000 15,963
6/17/97 5.65 18,000 17,955
COMMERCIAL PAPER - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
Citibank Credit Card Master Trust I (Dakota Certificate Program) -
continued
6/17/97 5.66% $ 20,000 $ 19,950
6/24/97 5.57 25,000 24,911
Commerzbank U.S. Finance, Inc.
6/24/97 5.56 97,200 96,857
Commonwealth Bank of Australia
6/23/97 5.55 70,000 69,764
10/1/97 5.87 32,114 31,494
CoreStates Capital Corp.
6/2/97 5.62 (a) 15,000 15,000
6/4/97 5.61 (a) 15,000 15,000
Cregem North America, Inc.
6/27/97 5.39 10,000 9,962
Delaware Funding Corporation
6/2/97 5.63 50,000 49,992
Den Danske Corp., Inc.
7/21/97 5.40 25,000 24,817
7/21/97 5.62 100,000 99,226
11/12/97 5.87 50,000 48,702
Eiger Capital Corp.
6/16/97 5.62 57,844 57,709
6/17/97 5.61 40,000 39,901
6/25/97 5.57 114,000 113,579
Enterprise Funding Corp.
6/3/97 5.60 30,000 29,991
6/16/97 5.61 30,000 29,930
7/7/97 5.58 34,855 34,662
7/10/97 5.62 26,000 25,843
7/10/97 5.63 14,000 13,915
Fina Oil and Chemical Company
6/20/97 5.61 25,000 24,926
6/23/97 5.57 10,000 9,966
Fleet Funding Corporation
7/10/97 5.59 12,406 12,331
Ford Motor Credit Corp.
7/10/97 5.58 200,000 198,800
7/11/97 5.58 130,000 129,200
7/21/97 5.62 185,000 183,569
7/23/97 5.61 146,000 144,828
11/5/97 5.87 30,000 29,254
11/10/97 5.87 100,000 97,435
GTE Corp.
6/11/97 5.62 25,000 24,961
Generale Bank
7/30/97 5.53 50,000 49,559
General Electric Capital Corp.
6/2/97 5.68 170,000 169,973
7/7/97 5.59 175,000 174,029
7/21/97 5.61 67,000 66,483
COMMERCIAL PAPER - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
General Electric Capital Corp. - continued
7/28/97 5.52% $ 100,000 $ 99,150
7/29/97 5.52 75,000 74,351
9/22/97 5.80 146,000 143,415
11/17/97 5.82 145,000 141,147
12/1/97 5.85 110,000 106,824
1/22/98 6.12 90,000 86,563
1/28/98 5.95 110,000 105,805
General Motors Acceptance Corp.
6/23/97 5.62 150,000 149,499
6/30/97 5.62 65,000 64,714
8/27/97 5.50 78,000 76,992
10/14/97 6.00 195,000 190,744
10/14/97 6.01 28,000 27,388
10/16/97 6.01 21,000 20,535
10/20/97 6.03 60,000 58,626
10/29/97 6.02 45,000 43,904
11/3/97 6.02 62,000 60,442
11/10/97 6.02 150,000 146,058
11/12/97 6.02 42,000 40,884
Goldman Sachs Group, L.P. (The)
1/23/98 6.09 40,000 38,471
1/26/98 6.10 105,000 100,936
Household Finance Corp.
7/7/97 5.62 35,000 34,805
Merrill Lynch & Co., Inc.
6/18/97 5.42 50,000 49,875
7/28/97 5.54 50,000 49,573
8/18/97 5.79 66,000 65,185
Morgan Stanley Group, Inc.
6/12/97 5.60 90,000 89,847
7/23/97 5.64 120,000 119,033
NationsBank Corp.
7/28/97 5.53 20,000 19,830
Nationwide Building Society
7/31/97 5.55 100,000 99,100
New Center Asset Trust
11/7/97 5.89 20,000 19,495
Norfolk Southern Corp.
6/3/97 5.74 24,000 23,992
6/9/97 5.75 16,000 15,980
6/9/97 5.77 28,000 27,964
6/11/97 5.82 10,900 10,882
6/12/97 5.77 18,000 17,968
6/12/97 5.82 8,100 8,086
PHH Corp.
7/14/97 5.63 22,000 21,853
COMMERCIAL PAPER - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
Preferred Receivables Funding Corp.
6/2/97 5.61% $ 30,000 $ 29,995
6/11/97 5.64 25,800 25,760
Royal Bank of Canada
7/23/97 5.40 30,000 29,771
Santander Finance (Delaware), Inc.
6/24/97 5.43 15,000 14,949
Sears Roebuck Acceptance Corp.
7/10/97 5.63 40,000 39,758
Textron, Inc.
6/10/97 5.75 25,000 24,964
6/23/97 5.70 5,000 4,983
6/23/97 5.71 2,000 1,993
6/23/97 5.73 5,000 4,983
Toronto-Dominion Holdings USA, Inc.
6/13/97 5.50 30,000 29,946
Transamerica Finance Corp.
6/19/97 5.57 22,000 21,939
Triple A One Funding Corp.
6/3/97 5.60 22,000 21,993
6/16/97 5.61 105,080 104,836
Unifunding, Inc.
6/6/97 5.60 40,000 39,969
6/11/97 5.56 85,000 84,869
Westdeutsche Landesbank Girozentrale
6/23/97 5.56 188,000 187,365
Westpac Capital Corp.
6/3/97 5.44 50,000 49,985
12/1/97 5.87 35,000 33,991
TOTAL COMMERCIAL PAPER 7,447,133
FEDERAL AGENCIES - 5.7%
FEDERAL HOME LOAN BANK - AGENCY COUPONS (A) - 0.4%
6/4/97 5.44 85,000 84,962
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS (A) - 5.3%
6/2/97 5.59 125,000 125,416
6/2/97 5.67 360,000 359,914
6/3/97 5.63 82,000 81,982
6/9/97 5.46 280,000 279,873
6/13/97 5.46 200,000 199,900
8/1/97 5.73 210,000 209,978
1,257,063
TOTAL FEDERAL AGENCIES 1,342,025
BANK NOTES - 7.2%
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
Bank of America National Trust & Savings Assoc.
6/19/97 5.50% $ 200,000 $ 200,000
6/23/97 5.55 60,000 60,000
Bank of New York, NY
3/3/98 5.85 40,000 39,986
Bank of Scotland Treasury Services
8/7/97 5.18 (a) 250,000 250,000
Bank One Columbus OH, NA
6/3/97 5.63 (a) 170,000 169,879
Boatmen's First National Bank of Kansas City
6/3/97 5.64 (a) 25,000 25,000
Comerica Bank
3/27/98 6.20 95,000 94,852
First National Bank of Boston
6/11/97 5.59 40,000 40,000
6/26/97 5.56 50,000 50,000
Harris Trust & Savings Bank, Chicago
6/2/97 5.55 75,000 75,000
6/26/97 5.55 50,000 50,000
Huntington National Bank
9/30/97 5.50 30,000 30,021
Key Bank, NA
6/2/97 5.67 (a) 50,000 49,997
6/2/97 5.70 (a) 50,000 49,978
6/12/97 5.71 (a) 70,000 69,958
Key Bank of New York
6/2/97 5.68 (a) 104,000 103,988
LaSalle National Bank
9/8/97 6.12 25,000 25,000
9/10/97 6.15 25,000 25,000
NBD Bank, NA (Michigan)
3/2/98 5.82 60,000 59,987
National City Bank
7/2/97 5.57 65,000 64,942
PNC Bank, NA
6/11/97 5.65 (a) 85,000 84,972
6/27/97 5.65 (a) 66,000 65,962
TOTAL BANK NOTES 1,684,522
MASTER NOTES (A) - 2.5%
Goldman Sachs Group, L.P. (The)
8/5/97 5.82 100,000 100,000
J.P. Morgan Securities
6/2/97 5.81 314,000 314,000
MASTER NOTES (A) - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
Norwest Corp.
6/2/97 5.69% $ 126,000 $ 126,000
Suntrust Banks, Inc.
6/2/97 5.64 40,000 40,000
TOTAL MASTER NOTES 580,000
MEDIUM-TERM NOTES (A) - 3.4%
Beneficial Corp.
6/5/97 5.47 50,000 50,006
CIT Group Holdings, Inc.
6/2/97 5.71 50,000 49,994
Commonwealth Life Insurance Co. (c)
6/2/97 5.86 50,000 50,000
General Motors Acceptance Corp.
6/2/97 5.73 40,000 39,994
7/21/97 5.69 50,000 50,032
8/1/97 5.82 100,000 100,000
Merrill Lynch & Co., Inc.
6/4/97 5.67 42,000 41,992
6/18/97 5.69 83,000 82,997
Morgan Stanley Group, Inc.
6/2/97 5.70 95,000 95,000
Norwest Corp.
7/22/97 5.86 118,000 118,000
Pacific Mutual Life Insurance Co. (c)
6/9/97 5.62 44,000 44,000
Transamerica Life Insurance and Annuity Co. (c)
6/2/97 5.72 20,000 20,000
6/16/97 5.63 65,000 65,000
TOTAL MEDIUM-TERM NOTES 807,015
SHORT-TERM NOTES (A) - 3.7%
CSA Funding - C
6/6/97 5.76 6,000 6,000
Capital One Funding Corp. (1996-D)
6/6/97 5.66 24,790 24,790
Capital One Funding Corp. (1996-F)
6/6/97 5.66 42,019 42,019
Capital One Funding Corp. (1996-G)
6/6/97 5.66 9,823 9,823
Capital One Funding Corp. (1996-H)
6/6/97 5.66 19,800 19,800
SHORT-TERM NOTES (A) - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL AMOUNT VALUE (NOTE 1)
DATE TIME OF PURCHASE (000S) (000S)
Liquid Asset Backed Securities Trust (1996 - 1) (b)
6/15/97 5.72% $ 91,000 $ 91,000
Liquid Asset Backed Securities Trust (1996 - 2) (b)
6/2/97 5.72 134,000 134,000
SMM Trust (1996-B) (b)
6/4/97 5.74 63,000 63,000
SMM Trust (1996-P) (b)
6/16/97 5.72 130,000 130,000
SMM Trust (1997-I) (b)
6/30/97 5.69 75,000 75,000
SMM Trust (1997-V) (b)
6/26/97 5.69 141,000 141,000
SMM Trust (1997-W) (b)
6/16/97 5.69 125,000 125,000
TOTAL SHORT-TERM NOTES 861,432
TIME DEPOSITS - 4.2%
Bank of Tokyo - Mitsubishi Ltd.
6/30/97 5.69 42,000 42,000
7/3/97 5.69 85,000 85,000
Chase Manhattan Bank
6/2/97 5.63 150,000 150,000
6/5/97 5.63 200,000 200,000
Deutsche Bank, Germany
6/2/97 5.66 250,000 250,000
Sumitomo Bank, Ltd.
6/4/97 5.72 107,000 107,000
6/9/97 5.73 32,000 32,000
6/18/97 5.75 120,000 120,000
TOTAL TIME DEPOSITS 986,000
REPURCHASE AGREEMENTS - 00.0%
MATURITY AMOUNT
(000S)
In a joint trading account
(U.S. Treasury Obligations)
dated 5/30/97 due 6/2/97
At 5.55% $ 590 590
TOTAL INVESTMENTS - 100% $ 23,471,829
Total Cost for Income Tax Purposes $ 23,471,829
LEGEND
1. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the next interest rate reset date or, when applicable,
the final maturity date.
2. Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $759,000,000 or 3.3% of net
assets.
3. Restricted security; subject to resale restrictions.
INCOME TAX INFORMATION
At November 30, 1996, the fund had a capital loss carryforward of
approximately $2,304,000 of which $510,000, $1,634,000 and $160,000 will
expire on November 30, 2001, 2002 and 2004, respectively.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNT) MAY 31, 1997
ASSETS
Investment in securities, at value (including repurchase $ 23,471,829
agreements of $590) - See accompanying schedule
Cash 31
Interest receivable 148,900
TOTAL ASSETS 23,620,760
LIABILITIES
Payable for investments purchased $ 814,940
Share transactions in process 55,738
Distributions payable 2,848
Accrued management fee 4,155
Other payables and accrued expenses 5,242
TOTAL LIABILITIES 882,923
NET ASSETS $ 22,737,837
Net Assets consist of:
Paid in capital $ 22,738,842
Accumulated net realized gain (loss) on investments (1,005)
NET ASSETS, for 22,738,842 shares outstanding $ 22,737,837
NET ASSET VALUE, offering price and redemption price per $1.00
share ($22,737,837 (divided by) 22,738,842 shares)
</TABLE>
STATEMENT OF OPERATIONS
AMOUNTS IN THOUSANDS SIX MONTHS ENDED MAY 31, 1997
INTEREST INCOME $ 617,032
EXPENSES
Management fee $ 22,888
Transfer agent fees 27,997
Accounting fees and expenses 406
Non-interested trustees' compensation 67
Custodian fees and expenses 183
Registration fees 36
Legal 15
Miscellaneous 3
Total expenses before reductions 51,595
Expense reductions (174) 51,421
NET INTEREST INCOME 565,611
NET REALIZED GAIN (LOSS) ON INVESTMENTS 70
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 565,681
STATEMENT OF CHANGES IN NET ASSETS
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED NOVEMBER 30,
MAY 31, 1996
1997
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations $ 565,611 $ 975,537
Net interest income
Net realized gain (loss) 70 (160)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 565,681 975,377
FROM OPERATIONS
Distributions to shareholders from net interest income (565,611) (975,537)
Share transactions at net asset value of $1.00 per share 23,441,954 36,638,550
Proceeds from sales of shares
Reinvestment of distributions from net interest income 545,214 948,155
Cost of shares redeemed (22,489,999) (34,777,730)
NET INCREASE (DECREASE) IN NET ASSETS AND SHARES 1,497,169 2,808,975
RESULTING FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,497,239 2,808,815
NET ASSETS
Beginning of period 21,240,598 18,431,783
End of period $ 22,737,837 $ 21,240,598
</TABLE>
FINANCIAL HIGHLIGHTS
SIX MONTHS YEARS ENDED NOVEMBER 30,
ENDED MAY 31,
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1997 1996 1995 1994 1993 1992
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment .025 .051 .055 .037 .029 .038
Operations
Net interest income
Less Distributions
From net interest income (.025) (.051) (.055) (.037) (.029) (.038)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 2.56% 5.18 5.67 3.74 2.97 3.90
% % % % %
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period $ 22,738 $ 21,241 $ 18,432 $ 14,529 $ 10,314 $ 10,040
(in millions)
Ratio of expenses to average .47% A .51 .55 .52 .48 .48
net assets % % % % %
Ratio of net interest income to 5.13% A 5.06 5.50 3.76 2.92 3.86
average net assets % % % % %
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
NOTES TO FINANCIAL STATEMENTS
For the period ended May 31, 1997
6. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Cash Reserves (the fund) is a fund of Fidelity Phillips Street
Trust(the trust) and is authorized to issue an unlimited number of shares.
The trust is registered under the Investment Company Act of 1940, as
amended (the 1940 Act), as an open-end management investment company
organized as a Delaware business trust. The financial statements have been
prepared in conformity with generally accepted accounting principles which
permit 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. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
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 schedule of investments includes information regarding
income taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
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.
7. 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.
8. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
fee that is calculated by multiplying the sum of two components, a group
fee rate plus a fixed individual fund fee rate, applied to the average net
assets of the fund and adding an income-based fee. The group fee rate is
the weighted average of a series of rates and is based on the monthly
average net assets of all the mutual funds advised by FMR. The rates ranged
from .1100% to .3700% for the period. In the event that these rates were
lower than the contractual rates in effect during the period, FMR
voluntarily implemented the above rates, as they resulted in the same or a
lower management fee. The individual fund fee rate is .03%. The
income-based fee is added only when the fund's gross yield exceeds 5%. At
that time the income-based fee would equal 6% of that portion of the fund's
gross income that represents a gross yield of more than 5% per year. The
maximum income-based component is 0.24% (annualized)of average net assets.
For the period, the management fee was equivalent to an annualized rate of
.21% of average net assets.
SUB-ADVISER FEE. As the fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect.
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
.25% 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.
9. EXPENSE REDUCTIONS.
The fund has entered into an arrangement with its 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
transfer agent fees were reduced by $174,000.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Phillips Street Trust and the Shareholders of
Fidelity Cash Reserves:
We have audited the accompanying statement of assets and liabilities of
Fidelity Phillips Street Trust: Fidelity Cash Reserves, including the
schedule of portfolio investments, as of May 31, 1997, and the related
statement of operations for the six months then ended, the statements of
changes in net assets for the six months then ended and for the year ended
November 30, 1996, and the financial highlights for the six months ended
May 31, 1997 and for each of the five years in the period ended November
30, 1996. These financial statements and financial highlights are the
responsibility of the fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of May 31, 1997 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Phillips Street Trust: Fidelity Cash Reserves as of May 31,
1997, the results of its operations for the six months then ended, the
changes in its net assets for the six months then ended and for the year
ended November 30, 1996, and the financial highlights for the six months
ended May 31, 1997 and for each of the five years in the period ended
November 30, 1996, in conformity with generally accepted accounting
principles.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
June 25, 1997
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 TouchTone Xpressprovides 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.
SM
(PHONE_GRAPHIC)(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
1
For quotes.*
2
For account balances and holdings.
3
To review orders and mutual
fund activity.
4
To change your PIN.
5
To speak to a Fidelity representative.
*
0
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.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at 1-800-544-7272
for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
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 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 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
(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 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
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
19100 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
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
4001 Tamiami Trail, North
Naples, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
1502 N. Westshore Blvd.
Tampa, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
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
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 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
10 Bank Street
White Plains, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
1903 East Ninth Street
Cleveland, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
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
VERMONT
199 Main Street
Burlington, VT
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
INVESTMENT ADVISER
(registered trademark)
Fidelity Management & Research
Company
Boston, MA
INVESTMENT SUB-ADVISER
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Sarah H. Zenoble, Vice President
John Todd, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Thomas D. Maher, Assistant
Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
William O. McCoy *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
The Bank of New York
New York, NY
FIDELITY'S TAXABLE
MONEY MARKET FUNDS
Fidelity Cash Reserves
Fidelity Daily Income Trust
Fidelity U.S. Government Reserves
Spartan(registered trademark) Money Market Fund
Spartan U.S. Government
Money Market Fund
Spartan U.S. Treasury
Money Market Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemption 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)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE
