SUPPLEMENT TO THE
DAILY MONEY FUNDS
U.S. TREASURY PORTFOLIO - INITIAL CLASS
MONEY MARKET PORTFOLIO - INITIAL CLASS
DAILY TAX-EXEMPT MONEY FUND - INITIAL CLASS
PROSPECTUS
DATED DECEMBER 20, 1996
Effective until January 1, 1997, the following information supplements the
information found in the seventh paragraph under the heading "Other
Expenses" in the "Breakdown of Expenses" section, on page P-13:
Pursuant to the Plans and effective until January 1, 1997, the Board of
Trustees has authorized FDC to compensate third parties at an annual rate
of up to 0.38% of average aggregate balances maintained, and, in special
circumstances, up to 0.40% of average aggregate balances maintained. This
additional 0.02% will be paid to investment professionals who maintain
assets in excess of $600 million in a single omnibus account.
SUPPLEMENT TO THE
DAILY MONEY FUND
U.S. TREASURY PORTFOLIO - CLASS B PROSPECTUS
DATED DECEMBER 20, 1996
Effective until January 1, 1997, the following information replaces the
similar information in the "Expenses" section, on page P-4:
Class B's expenses are factored into its share price or dividends and are
not charged directly to shareholder accounts (see "Breakdown of Expense" on
page P-9).
The following figures are based on historical expenses of Class B and are
calculated as a percentage of average net assets of Class B of the fund.
Management fee* 0.22
%
12b-1 fee (including 0.25 % Shareholder Service Fee) 1.00
%
Other expenses (after reimbursement) 0.13
%
Total operating expenses 1.35
%
* THE RATE FOR MANAGEMENT FEES REPRESENTS THE NET RATE RETAINED BY FMR
AFTER PAYMENT MADE TO THE DISTRIBUTOR. THE MANAGEMENT FEE BEFORE PAYMENTS
MADE TO THE DISTRIBUTOR BY FMR IS 0.50 %.
EXPENSE TABLE EXAMPLE: You would pay the following expenses, including the
maximum front-end sales charge or CDSC, as applicable, on a $1,000
investment, assuming a 5% annual return and either (1) full redemption or
(2) no redemption, at the end of each time period:
If you purchased Class B shares directly in connection with the Program or
by exchange from a Fidelity Advisor equity or long-term bond fund.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year 3 5 10
Years Years Years
B
(1) $ 54A $ 73A $ 84A $ 126
(2) $ 14 $ 43 $ 74 $ 126
</TABLE>
A REFLECTS DEDUCTION OF APPLICABLE CDSC.
B REFLECTS CONVERSION TO INITIAL CLASS SHARES AFTER SIX YEARS.
If you purchased Class B shares by exchange from a Fidelity Advisor
intermediate-term bond fund.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year 3 5 10
Years Years Years
B
(1) $ 44A $ 53A $ 66 $ 109
(2) $ 14 $ 43 $ 66 $ 109
</TABLE>
A REFLECTS DEDUCTION OF APPLICABLE CDSC.
B REFLECTS CONVERSION TO INITIAL CLASS SHARES AFTER FOUR YEARS.
THESE EXAMPLES ILLUSTRATE THE EFFECT OF EXPENSES, BUT ARE NOT MEANT TO
SUGGEST ACTUAL OR EXPECTED COSTS OR RETURNS, ALL OF WHICH MAY VARY.
FMR has voluntarily agreed to reimburse Class B to the extent that total
operating expenses exceed 1.35 % of its average net assets. If this
agreement were not in effect, other expenses and total operating expenses,
as a percentage of average net assets, of Class B of the fund would have
been, 0.20 % and 1.70 %, respectively. Expenses eligible for
reimbursement do not include interest, taxes, brokerage commissions, and
extraordinary expenses.
Effective until January 1, 1997, the following information replaces the
similar information under the "Selling Shares in Writing" heading in the
"How to Sell Shares" section, on page P-12:
Deliver your letter to your investment professional, or mail it to the
following address:
(small solid bullet) If you purchased your shares through a broker-dealer
or insurance representative:
Daily Money Fund:
U.S. Treasury Portfolio - Class B
P.O. Box 8302
Boston, MA 02266-8302
(small solid bullet) If you purchased your shares through a bank
representative:
Fidelity Investments
P.O. 770002
Cincinnati, OH 45277-0081
