DAILY MONEY FUND/MA/, 485APOS, 1999-04-12

DAILY MONEY FUND/MA/
485APOS, 1999-04-12

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT (No. 2-77909)
UNDER THE SECURITIES ACT OF 1933 [X]

Pre-Effective Amendment No. [ ]

Post-Effective Amendment No. 46 [X]

and

REGISTRATION STATEMENT (No. 811-3480)
UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]

Amendment No. 46 [X]

Fidelity Oxford Street Trust
(Exact Name of Registrant as Specified in Charter)

82 Devonshire St., Boston, Massachusetts 02109
(Address Of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number: 617-563-7000

Eric D. Roiter, Secretary
82 Devonshire Street
Boston, Massachusetts 02109
(Name and Address of Agent for Service)

It is proposed that this filing will become effective
( ) immediately upon filing pursuant to paragraph (b).
( ) on ( ) pursuant to paragraph (b).
( ) 60 days after filing pursuant to paragraph (a)(1).
( ) on ( ) pursuant to paragraph (a)(1) of Rule 485.
( ) 75 days after filing pursuant to paragraph (a)(2).
(x) on (June 26, 1999) pursuant to paragraph (a)(2) of Rule 485.

If appropriate, check the following box:
( ) this post-effective amendment designates a new effective date
for a previously filed post-effective amendment.

Like securities of all mutual
funds, these securities have
not been approved or
disapproved by the
Securities and Exchange
Commission, and the
Securities and Exchange
Commission has not
determined if this
prospectus is accurate or
complete. Any
representation to the
contrary is a criminal
offense.

FIDELITY(registered trademark)
FOUR-IN-ONE
INDEX
FUND

(fund number 355, trading symbol FIDVF)

PROSPECTUS
JUNE 26, 1999

(fidelity_logo_graphic)(registered trademark)
82 Devonshire Street, Boston, MA 02109

CONTENTS

FUND SUMMARY 4 INVESTMENT SUMMARY

4 PERFORMANCE

4 FEE TABLE

FUND BASICS 5 INVESTMENT DETAILS

7 VALUING SHARES

SHAREHOLDER INFORMATION 7 BUYING AND SELLING SHARES

14 EXCHANGING SHARES

15 ACCOUNT FEATURES AND POLICIES

17 DIVIDENDS AND CAPITAL GAINS
DISTRIBUTIONS

17 TAX CONSEQUENCES

FUND SERVICES 18 FUND MANAGEMENT

18 FUND DISTRIBUTION

APPENDIX 19 ADDITIONAL INFORMATION ABOUT
THE INDEXES

FUND SUMMARY

INVESTMENT SUMMARY

INVESTMENT OBJECTIVE

FOUR-IN-ONE INDEX FUND seeks high total return.

PRINCIPAL INVESTMENT STRATEGIES

Strategic Advisers, Inc. (Strategic Advisers)'s principal investment
strategies include:

(small solid bullet) Investing in a combination of four Fidelity stock
and bond index funds using an asset allocation strategy designed for
investors seeking a broadly diversified, index-based investment.

(small solid bullet) Allocating assets among underlying Fidelity index
funds according to a target asset allocation of approximately:

Spartan(registered trademark)
Market Index
Fund 55%

Spartan
Extended Market
Index Fund 15%

Spartan-
International-
Index
Fund 15%

Fidelity U.S.
Bond Index
Fund 15%

Row: 1, Col: 1, Value: 15.0
Row: 1, Col: 2, Value: 50.0
Row: 1, Col: 3, Value: 20.0
Row: 1, Col: 4, Value: 15.0
Row: 1, Col: 5, Value: 0.0

PRINCIPAL INVESTMENT RISKS

The fund is subject to the following principal investment risks:

(small solid bullet) STOCK MARKET VOLATILITY. Stock markets are
volatile and can decline significantly in response to adverse issuer,
political, regulatory, market or economic developments. Different
parts of the market can react differently to these developments.

(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a debt security to decrease.

(small solid bullet) FOREIGN EXPOSURE. Foreign markets can be more
volatile than the U.S. market due to increased risks of adverse
issuer, political, regulatory, market or economic developments and can
perform differently than the U.S. market.

(small solid bullet) PREPAYMENT. The ability of an issuer of a debt
security to repay principal prior to a security's maturity can cause
greater price volatility if interest rates change.

(small solid bullet) ISSUER-SPECIFIC CHANGES. The value of an
individual security or particular type of security can be more
volatile than the market as a whole and can perform differently than
the value of the market as a whole.

(small solid bullet) SMALL CAP INVESTING. The value of securities of
smaller, less well-known issuers can perform differently than the
market as a whole and other types of stocks and can be more volatile
than that of larger issuers.

An investment in the fund is not a deposit of a bank and is not
insured or guaranteed by the Federal Deposit Insurance Corporation or
any other government agency.

When you sell your shares of the fund, they could be worth more or
less than what you paid for them.

PERFORMANCE

Because the fund was new when this prospectus was printed, its
performance history is not included. Performance history will be
available for the fund after the fund has been in operation for one
calendar year.

FEE TABLE

The following table describes the fees and expenses that are incurred
when you buy, hold or sell shares of the fund. The annual fund
operating expenses provided below for Four-in-One Index are based on
estimated expenses.

SHAREHOLDER FEES (PAID BY THE INVESTOR DIRECTLY)

Sales charge (load) on None
purchases and reinvested
distributions

Deferred sales charge (load) None
on redemptions

Redemption fee on shares 0.50%
held less than 90 days (as a
% of amount redeemed)

Annual index account fee (for $10.00
accounts under $10,000)

ANNUAL FUND OPERATING EXPENSES (PAID FROM FUND ASSETS)

Management fee [0.10]%

Distribution and Service None
(12b-1) fee

Other expenses [0.00]%

Total annual fund operating [0.10]%
expensesA

A Effective ___ __,1999, Strategic AdvisersSM has voluntarily agreed
to reimburse Four-in-One Index to the extent that the management fee,
other expenses and total operating expenses (excluding interest,
taxes, brokerage commissions and extraordinary expenses) exceed __% of
its average net assets. These arrangements can be terminated by
Strategic Advisers at any time.

Four-in-One Index may incur exchange or short-term trading fees, if
applicable, when it invests in underlying Fidelity funds.

In addition to the total fund operating expenses shown above,
Four-in-One Index, as a shareholder in an underlying Fidelity fund,
will indirectly bear its pro rata share of the fees and expenses
incurred by the underlying Fidelity fund, and Four-in-One Index's
investment return will be net of underlying Fidelity fund expenses.

The total expense ratio of Four-in-One Index (calculated as a
percentage of average net assets) is estimated to be ___%. Four-in-One
Index's estimated total expense ratio is based on its estimated total
operating expense ratio plus a weighted average of the total operating
expense ratios of the underlying Fidelity funds in which it would have
been invested (as of each underlying Fidelity fund's most recently
reported fiscal year-end) as of June 1, 1999. These total expense
ratios may be higher or lower depending on the allocation of
Four-in-One Index's assets among the underlying Fidelity funds and the
actual expenses of the underlying Fidelity funds.

This EXAMPLE helps you compare the cost of investing in the fund with
the cost of investing in other mutual funds.

Let's say, hypothetically, that Four-in-One Index's annual return is
5%, that your shareholder fees are exactly as described in the fee
table, and that Four-in-One Index's total expenses are as described
above. This example illustrates the effect of fees and expenses, but
is not meant to suggest actual or expected fees and expenses or
returns, all of which may vary. For every $10,000 you invested, here's
how much you would pay in total expenses if you close your account
after the number of years indicated:

1 year $

3 years $

FUND BASICS

INVESTMENT DETAILS

INVESTMENT OBJECTIVE

FOUR-IN-ONE INDEX FUND seeks high total return.

PRINCIPAL INVESTMENT STRATEGIES

Strategic Advisers invests Four-in-One Index's assets in a combination
of four Fidelity funds: three Fidelity stock index funds (domestic and
international) and one Fidelity investment-grade bond index fund
(underlying Fidelity funds).

The table below lists the underlying Fidelity funds in which
Four-in-One Index currently may invest and the fund's approximate
target asset allocation.

FUNDS ASSET ALLOCATION

Spartan Market Index Fund 55%

Spartan Extended Market Index 15%
Fund

Spartan International Index 15%
Fund

Fidelity U.S. Bond Index Fund 15%

Strategic Advisers intends to manage Four-in-One Index according to
its target asset allocation strategy, and does not intend to trade
actively among underlying Fidelity funds or intend to attempt to
capture short-term market opportunities. However, Strategic Advisers
may modify the target asset allocation strategy for Four-in-One Index
and modify the selection of underlying Fidelity funds from time to
time.

DESCRIPTION OF UNDERLYING FIDELITY FUNDS

SPARTAN MARKET INDEX FUND seeks investment results that correspond to
the total return (i.e., the combination of capital changes and income)
of common stocks publicly traded in the United States, as represented
by the Standard & Poor's 500 Index (S&P 500(registered trademark)),
while keeping transaction costs and other expenses low.

Bankers Trust Company (BT) normally invests at least 80% of the fund's
assets in common stocks included in the S&P 500. The S&P 500 is a
widely recognized, unmanaged index of common stock prices.

The fund may not always hold all of the same securities as the S&P
500. BT may choose, if extraordinary circumstances warrant, to
exclude an index stock from the fund and substitute a similar stock if
doing so will help the fund achieve its objective.

The fund seeks to achieve a 98% or better correlation between its
total return and the total return of the index. The fund may not
track the index perfectly because differences between the index and
the fund's portfolio can cause differences in performance. In
addition, expenses and transaction costs, the size and frequency of
cash flow into and out of the fund, and differences between how and
when the fund and the index are valued can cause differences in
performance.

BT may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.

BT may use various techniques, such as buying and selling futures
contracts, to increase or decrease the fund's exposure to changing
security prices or other factors that affect security values. If BT's
strategies do not work as intended, the fund may not achieve its
objective.

SPARTAN EXTENDED MARKET INDEX FUND seeks to provide investment results
that correspond to the total return of stocks of mid- to
small-capitalization United States companies.

BT normally invests at least 80% of the fund's assets in common stocks
included in the Wilshire 4500. The Wilshire 4500 is a
capitalization-weighted index of approximately 6,500 common stocks of
companies headquartered in the United States. The Wilshire 4500
includes all stocks in the Wilshire 5000 except for the stocks
included in the S&P 500. The Wilshire 4500 broadly represents the
performance of stocks of mid- to small-capitalization U.S. companies.

BT may use statistical sampling techniques to attempt to replicate the
returns of the Wilshire 4500 using a smaller number of securities.
Statistical sampling techniques attempt to match the investment
characteristics of the index and the fund by taking into account such
factors as capitalization, industry exposures, dividend yield,
price/earnings ratio, price/book ratio and earnings growth.

The fund seeks to achieve a 98% or better correlation between its
total return and the total return of the index. The fund may not track
the index perfectly because differences between the index and the
fund's portfolio can cause differences in performance. In addition,
expenses and transaction costs, the size and frequency of cash flows
into and out of the fund, and differences between how and when the
fund and the index are valued can cause differences in performance.

BT may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.

SPARTAN INTERNATIONAL INDEX FUND seeks to provide investment results
that correspond to the total return of foreign stock markets.

BT normally invests at least 80% of the fund's assets in common stocks
included in the Morgan Stanley Capital International Europe,
Australasia, Far East (MSCI EAFE) Index. The MSCI EAFE Index is a
capitalization-weighted index that currently includes stocks of
companies located in 15 European countries (Austria, Belgium, Denmark,
Finland, France, Germany, Ireland, Italy, the Netherlands, Norway,
Portugal, Spain, Sweden, Switzerland, and the United Kingdom),
Australia, New Zealand, Hong Kong, Japan, Malaysia, and Singapore. The
MSCI EAFE Index broadly represents the performance of foreign stock
markets.

BT may use statistical sampling techniques to attempt to replicate the
returns of the MSCI EAFE Index using a smaller number of securities.
Statistical sampling techniques attempt to match the investment
characteristics of the index and the fund by taking into account such
factors as capitalization, industry exposures, dividend yield,
price/earnings ratio, price/book ratio, earnings growth, country
weightings, and the effect of foreign taxes.

The fund seeks to achieve a 98% or better correlation between its
total return and the total return of the index. The fund may not track
the index perfectly because differences between the index and the
fund's portfolio can cause differences in performance. In addition,
expenses and transaction costs, the size and frequency of cash flows
into and out of the fund and differences between how and when the fund
and the index are valued may cause differences in performance.

BT may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.

U.S. BOND INDEX FUND seeks to provide investment results that
correspond to the total return of the bonds in the Lehman Brothers
Aggregate Bond Index.

Fidelity Management & Research Company (FMR) normally invests at least
80% of the fund's assets in bonds included in the Lehman Brothers
Aggregate Bond Index (the Index). The Index is composed of U.S. dollar
denominated, fixed-rate debt issues, including government, corporate,
asset-backed and mortgage-backed securities.

FMR may use statistical sampling techniques to attempt to replicate
the returns of the Index using a smaller number of securities.
Statistical sampling techniques attempt to match the investment
characteristics of the Index and the fund by taking into account such
factors as duration, maturity, interest rate sensitivity, security
structure and credit quality. FMR expects the fund's investments will
approximate the broad market sector weightings of the Index within a
range of (plus/minus)10%.

The fund seeks to achieve a 90% or better correlation between its
total return and the total return of the Index. The fund may not track
the Index perfectly because differences between the Index and the
fund's portfolio can cause differences in performance. In addition,
expenses and transaction costs, the size and frequency of cash flows
into and out of the fund, and differences between how and when the
fund and the Index are valued can cause differences in performance.

In order to earn additional income for the fund, FMR may use a trading
strategy that involves selling mortgage securities and simultaneously
agreeing to purchase similar securities on a later date at a set
price. This trading strategy may result in an increased portfolio
turnover rate which increases transaction costs and may increase
taxable gains.

FMR may use various techniques, such as buying and selling futures
contracts, to increase or decrease the fund's exposure to changing
security prices, interest rates or other factors that affect security
values. If FMR's strategies do not work as intended, the fund may not
achieve its objective.

PRINCIPAL INVESTMENT RISKS

Many factors affect Four-in-One Index's performance. Four-in-One
Index's share price changes daily based on the performance of the
underlying Fidelity funds in which it invests. The ability of
Four-in-One Index to meet its investment objective is directly related
to its target asset allocation among underlying Fidelity funds and the
ability of those funds to meet their investment objectives. When you
sell your shares of Four-in-One Index, they could be worth more or
less than what you paid for them.

The following factors significantly affect Four-in-One Index's
performance:

STOCK MARKET VOLATILITY. The value of equity securities fluctuates in
response to issuer, political, market and economic developments. In
the short term, equity prices can fluctuate dramatically in response
to these developments. Different parts of the market and different
types of equity securities can react differently to these
developments. For example, large cap stocks can react differently from
small cap stocks, and "growth" stocks can react differently from
"value" stocks. Issuer, political or economic developments can affect
a single issuer, issuers within an industry or economic sector or
geographic region, or the market as a whole.

INTEREST RATE CHANGES. Debt securities have varying levels of
sensitivity to changes in interest rates. In general, the price of a
debt security can fall when interest rates rise and can rise when
interest rates fall. Securities with longer maturities and mortgage
securities can be more sensitive to interest rate changes. In other
words, the longer the maturity of a security, the greater the impact a
change in interest rates could have on the security's price. In
addition, short-term and long-term interest rates do not necessarily
move in the same amount or the same direction. Short-term securities
tend to react to changes in short-term interest rates, and long-term
securities tend to react to changes in long-term interest rates.

FOREIGN EXPOSURE. Foreign securities, foreign currencies and
securities issued by U.S. entities with substantial foreign operations
can involve additional risks relating to political, economic or
regulatory conditions in foreign countries. These risks include
fluctuations in foreign currencies; withholding or other taxes;
trading, settlement, custodial and other operational risks; and the
less stringent investor protection and disclosure standards of some
foreign markets. All of these factors can make foreign investments,
especially those in emerging markets, more volatile and potentially
less liquid than U.S. investments. In addition, foreign markets can
perform differently than the U.S. market.

PREPAYMENT. Many types of debt securities, including mortgage
securities, are subject to prepayment risk. Prepayment occurs when the
issuer of a security can repay principal prior to the security's
maturity. Securities subject to prepayment generally offer less
potential for gains during a declining interest rate environment, and
similar or greater potential for loss in a rising interest rate
environment. In addition, the potential impact of prepayment features
on the price of a debt security can be difficult to predict and result
in greater volatility.

ISSUER-SPECIFIC CHANGES. Changes in the financial condition of an
issuer, changes in specific economic or political conditions that
affect a particular type of security or issuer, and changes in general
economic or political conditions can affect the credit quality or
value of an issuer's securities. Lower-quality debt securities (those
of less than investment-grade quality) tend to be more sensitive to
these changes than higher-quality debt securities.

SMALL CAP INVESTING. The value of securities of smaller, less
well-known issuers can be more volatile than that of larger issuers
and can react differently to issuer, political, market and economic
developments than the market as a whole and other types of stocks.
Smaller issuers can have more limited product lines, markets and
financial resources.

In response to market, economic, political or other conditions,
Strategic Advisers may temporarily use a different investment strategy
for defensive purposes. If Strategic Advisers does so, different
factors could affect Four-in-One Index's performance and the fund may
not achieve its investment objective.

FUNDAMENTAL INVESTMENT POLICIES

The policy discussed below is fundamental, that is, subject to change
only by shareholder approval.

FOUR-IN-ONE INDEX FUND seeks high total return.

VALUING SHARES

The fund is open for business each day the New York Stock Exchange
(NYSE) is open.

The fund's net asset value per share (NAV) is the value of a single
share. Fidelity normally calculates the fund's NAV as of the close of
business of the NYSE, normally 4:00 p.m. Eastern time. However, NAV
may be calculated earlier if trading on the NYSE is restricted or as
permitted by the Securities and Exchange Commission (SEC). The fund's
assets are valued as of this time for the purpose of computing the
fund's NAV.

To the extent that the fund's assets are traded in other markets on
days when the NYSE is closed, the value of the fund's assets may be
affected on days when the fund is not open for business. In addition,
trading in some of the fund's assets may not occur on days when the
fund is open for business.

The assets of Four-in-One Index consist primarily of shares of the
underlying Fidelity funds, which are valued at their respective NAVs.
Most underlying Fidelity fund assets are valued primarily on the basis
of market quotations or on the basis of information furnished by a
pricing service. Certain short-term securities are valued on the basis
of amortized cost. If market quotations or information furnished by a
pricing service is not available for a security held by an underlying
Fidelity fund or if the value of a security held by an underlying
Fidelity fund has been materially affected by events occurring after
the close of the exchange or market on which the security is
principally traded (for example, a foreign exchange or market), that
security may be valued by another method that the Board of Trustees
believes accurately reflects fair value. A security's valuation may
differ depending on the method used for determining value.

SHAREHOLDER INFORMATION

BUYING AND SELLING SHARES

GENERAL INFORMATION

Fidelity Investments(registered trademark) was established in 1946 to
manage one of America's first mutual funds. Today, Fidelity is the
largest mutual fund company in the country, and is known as an
innovative provider of high-quality financial services to individuals
and institutions.

In addition to its mutual fund business, the company operates one of
America's leading discount brokerage firms, Fidelity Brokerage
Services, Inc. (FBSI). Fidelity is also a leader in providing
tax-advantaged retirement plans for individuals investing on their own
or through their employer.

For account, product and service information, please use the following
Web site and phone numbers:

(small solid bullet) For information over the Internet, visit
Fidelity's Web site at www.fidelity.com.

(small solid bullet) For accessing account information automatically
by phone, use TouchTone Xpress(registered trademark), 1-800-544-5555.

(small solid bullet) For exchanges and redemptions, 1-800-544-7777.

(small solid bullet) For account assistance, 1-800-544-6666.

(small solid bullet) For mutual fund and retirement information,
1-800-544-8888.

(small solid bullet) For brokerage information, 1-800-544-7272.

(small solid bullet) TDD - Service for the Deaf and Hearing-Impaired,
1-800-544-0118 (9:00 a.m. - 9:00 p.m. Eastern time).

Please use the following addresses:

BUYING SHARES

Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002

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

You may buy or sell shares of the fund through a retirement account or
an investment professional. If you invest through a retirement account
or an investment professional, the procedures for buying, selling and
exchanging shares of the fund and the account features and policies
may differ. Additional fees may also apply to your investment in the
fund, including a transaction fee if you buy or sell shares of the
fund through a broker or other investment professional.

Certain methods of contacting Fidelity, such as by telephone or
electronically, may be unavailable or delayed (for example, during
periods of unusual market activity). In addition, the level and type
of service available may be restricted based on criteria established
by Fidelity.

The different ways to set up (register) your account with Fidelity are
listed in the following table.

WAYS TO SET UP YOUR ACCOUNT

INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS

RETIREMENT
FOR TAX-ADVANTAGED RETIREMENT SAVINGS
(solid bullet) TRADITIONAL INDIVIDUAL RETIREMENT ACCOUNTS (IRAS)
(solid bullet) ROTH IRAS
(solid bullet) ROLLOVER IRAS
(solid bullet) 401(K) PLANS AND CERTAIN OTHER 401(A)-QUALIFIED PLANS
(solid bullet) KEOGH PLANS
(solid bullet) SIMPLE IRAS
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS)
(solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS)
(solid bullet) 403(B) CUSTODIAL ACCOUNTS
(solid bullet) DEFERRED COMPENSATION PLANS (457 PLANS)

GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS

TRUST
FOR MONEY BEING INVESTED BY A TRUST

BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS OR
OTHER GROUPS

BUYING SHARES

The price to buy one share of the fund is the fund's NAV. The fund's
shares are sold without a sales charge.

Your shares will be bought at the next NAV calculated after your
investment is received in proper form.

Short-term or excessive trading into and out of the fund may harm
performance by disrupting portfolio management strategies and by
increasing expenses. Accordingly, the fund may reject any purchase
orders, including exchanges, particularly from market timers or
investors who, in FMR's opinion, have a pattern of short-term or
excessive trading or whose trading has been or may be disruptive to
the fund. For these purposes, FMR may consider an investor's trading
history in the fund or other Fidelity funds, and accounts under common
ownership or control.

The fund may stop offering shares completely or may offer shares only
on a limited basis, for a period of time or permanently.

When you place an order to buy shares, note the following:

(small solid bullet) All of your purchases must be made in U.S.
dollars and checks must be drawn on U.S. banks.

(small solid bullet) Fidelity does not accept cash.

(small solid bullet) When making a purchase with more than one check,
each check must have a value of at least $50.

(small solid bullet) Fidelity reserves the right to limit the number
of checks processed at one time.

(small solid bullet) If your check does not clear, your purchase will
be canceled and you could be liable for any losses or fees the fund or
Fidelity has incurred.

Certain financial institutions that have entered into sales agreements
with Fidelity Distributors Corporation (FDC) may enter confirmed
purchase orders on behalf of customers by phone, with payment to
follow no later than the time when the fund is priced on the following
business day. If payment is not received by that time, the order will
be canceled and the financial institution could be held liable for
resulting fees or losses.

MINIMUMS

TO OPEN AN ACCOUNT $10,000

For certain Fidelity retirement accountsA $500

TO ADD TO AN ACCOUNT $1,000

For certain Fidelity retirement accountsA $250

Through regular investment plans $500

MINIMUM BALANCE $5,000

For certain Fidelity retirement accountsA $500

A FIDELITY TRADITIONAL IRA, ROTH IRA, ROLLOVER IRA, SEP-IRA, AND KEOGH
ACCOUNTS.

There is no minimum account balance or initial or subsequent purchase
minimum for investments through Fidelity Portfolio Advisory
ServicesSM, a qualified state tuition program, certain Fidelity
retirement accounts funded through salary deduction, or accounts
opened with the proceeds of distributions from such retirement
accounts. In addition, the fund may waive or lower purchase minimums
in other circumstances.

KEY INFORMATION

PHONE 1-800-544-7777 TO OPEN AN ACCOUNT
(small solid bullet) Exchange
from another Fidelity fund.

TO ADD TO AN ACCOUNT
(small solid bullet) Exchange
from another Fidelity fund.
(small solid bullet) Use
Fidelity Money
Line(registered trademark)
to transfer from your bank
account.

INTERNET WWW.FIDELITY.COM TO OPEN AN ACCOUNT
(small solid bullet) Complete
and sign the application.
Make your check payable to
the complete name of the
fund. Mail to the address
under "Mail" below.

TO ADD TO AN ACCOUNT
(small solid bullet) Exchange
from another Fidelity fund.
(small solid bullet) Use
Fidelity Money Line to
transfer from your bank
account.

MAIL FIDELITY INVESTMENTS TO OPEN AN ACCOUNT
P.O. BOX 770001 CINCINNATI, (small solid bullet) Complete
OH 45277-0002 and sign the application.
Make your check payable to
the complete name of the
fund. Mail to the address at
left.

TO ADD TO AN ACCOUNT
(small solid bullet) Make
your check payable to the
complete name of the fund.
Indicate your fund account
number on your check and
mail to the address at left.
(small solid bullet) Exchange
from another Fidelity fund.
Send a letter of instruction
to the address at left,
including your name, the
funds' names, the fund
account numbers, and the
dollar amount or number of
shares to be exchanged.

IN PERSON TO OPEN AN ACCOUNT
(small solid bullet) Bring
your application and check
to a Fidelity Investor
Center. Call 1-800-544-9797
for the center nearest you.

TO ADD TO AN ACCOUNT
(small solid bullet) Bring
your check to a Fidelity
Investor Center. Call
1-800-544-9797 for the
center nearest you.

WIRE TO OPEN AN ACCOUNT
(small solid bullet) Call
1-800-544-7777 to set up
your account and to arrange
a wire transaction.
(small solid bullet) Wire
within 24 hours to: Bankers
Trust Company, Bank Routing
# 021001033, Account #
00163053.
(small solid bullet) Specify
the complete name of the
fund and include your new
fund account number and your
name.

TO ADD TO AN ACCOUNT
(small solid bullet) Wire to:
Bankers Trust Company, Bank
Routing # 021001033, Account
# 00163053.
(small solid bullet) Specify
the complete name of the
fund and include your fund
account number and your name.

AUTOMATICALLY TO OPEN AN ACCOUNT
(small solid bullet) Not
available.

TO ADD TO AN ACCOUNT
(small solid bullet) Use
Fidelity Automatic Account
Builder(registered
trademark) or Direct Deposit.
(small solid bullet) Use
Fidelity Automatic Exchange
Service to exchange from a
Fidelity money market fund.

SELLING SHARES

The price to sell one share of the fund is the fund's NAV, minus the
redemption fee (short-term trading fee), if applicable.

The fund will deduct a short-term trading fee of 0.50% from the
redemption amount if you sell your shares after holding them less than
90 days. This fee is paid to the fund rather than Fidelity, and the
fund will, in turn, pay the fee to the underlying funds with
short-term trading fees. The underlying funds' short-term trading fees
are designed to offset the brokerage commissions, market impact, and
other costs associated with fluctuations in fund asset levels and cash
flow caused by short-term shareholder trading.

If you bought shares on different days, the shares you held longest
will be redeemed first for purposes of determining whether the
short-term trading fee applies. The short-term trading fee does not
apply to shares that were acquired through reinvestment of
distributions.

Your shares will be sold at the next NAV calculated after your order
is received in proper form, minus the short-term trading fee, if
applicable.

Certain requests must include a signature guarantee. It is designed to
protect you and Fidelity from fraud. Your request must be made in
writing and include a signature guarantee if any of the following
situations apply:

(small solid bullet) You wish to sell more than $100,000 worth of
shares;

(small solid bullet) Your account registration has changed within the
last 30 days;

(small solid bullet) The check is being mailed to a different address
than the one on your account (record address);

(small solid bullet) The check is being made payable to someone other
than the account owner; or

(small solid bullet) The redemption proceeds are being transferred to
a Fidelity account with a different registration.

You should be able to obtain a signature guarantee from a bank, broker
(including Fidelity Investor Centers), dealer, credit union (if
authorized under state law), securities exchange or association,
clearing agency, or savings association. A notary public cannot
provide a signature guarantee.

When you place an order to sell shares, note the following:

(small solid bullet) If you are selling some but not all of your
shares, leave at least $5,000 worth of shares in the account to keep
it open ($500 for retirement accounts), except accounts not subject to
account minimums.

(small solid bullet) Normally, Fidelity will process redemptions by
the next business day, but Fidelity may take up to seven days to
process redemptions if making immediate payment would adversely affect
the fund.

(small solid bullet) Redemption proceeds (other than exchanges) may be
delayed until money from prior purchases sufficient to cover your
redemption has been received and collected. This can take up to seven
business days after a purchase.

(small solid bullet) Redemptions may be suspended or payment dates
postponed when the NYSE is closed (other than weekends or holidays),
when trading on the NYSE is restricted, or as permitted by the SEC.

(small solid bullet) Redemption proceeds may be paid in securities or
other assets rather than in cash if the Board of Trustees determines
it is in the best interests of the fund.

(small solid bullet) You will not receive interest on amounts
represented by uncashed redemption checks.

(small solid bullet) Unless otherwise instructed, Fidelity will send a
check to the record address.

KEY INFORMATION

PHONE 1-800-544-7777 (small solid bullet) Call the
phone number at left to
initiate a wire transaction
or to request a check for
your redemption.
(small solid bullet) Use
Fidelity Money Line to
transfer to your bank account.
(small solid bullet) Exchange
to another Fidelity fund.
Call the phone number at left.

INTERNET WWW.FIDELITY.COM (small solid bullet) Exchange
to another Fidelity fund.
(small solid bullet) Use
Fidelity Money Line to
transfer to your bank account.

MAIL FIDELITY INVESTMENTS INDIVIDUAL, JOINT TENANT,
P.O. BOX 660602 DALLAS, TX SOLE PROPRIETORSHIP, UGMA,
75266-0602 UTMA
(small solid bullet) Send a
letter of instruction to the
address at left, including
your name, the fund's name,
your fund account number,
and the dollar amount or
number of shares to be sold.
The letter of instruction
must be signed by all
persons required to sign for
transactions, exactly as
their names appear on the
account.

RETIREMENT ACCOUNT
(small solid bullet) The
account owner should
complete a retirement
distribution form. Call
1-800-544-6666 to request one.

TRUST
(small solid bullet) Send a
letter of instruction to the
address at left, including
the trust's name, the fund's
name, the trust's fund
account number, and the
dollar amount or number of
shares to be sold. The
trustee must sign the letter
of instruction indicating
capacity as trustee. If the
trustee's name is not in the
account registration,
provide a copy of the trust
document certified within
the last 60 days.

BUSINESS OR ORGANIZATION
(small solid bullet) Send a
letter of instruction to the
address at left, including
the firm's name, the fund's
name, the firm's fund
account number, and the
dollar amount or number of
shares to be sold. At least
one person authorized by
corporate resolution to act
on the account must sign the
letter of instruction.
(small solid bullet) Include
a corporate resolution with
corporate seal or a
signature guarantee.

EXECUTOR, ADMINISTRATOR,
CONSERVATOR, GUARDIAN
(small solid bullet) Call
1-800-544-6666 for
instructions.

IN PERSON INDIVIDUAL, JOINT TENANT,
SOLE PROPRIETORSHIP, UGMA,
UTMA
(small solid bullet) Bring a
letter of instruction to a
Fidelity Investor Center.
Call 1-800-544-9797 for the
center nearest you. The
letter of instruction must
be signed by all persons
required to sign for
transactions, exactly as
their names appear on the
account.

RETIREMENT ACCOUNT
(small solid bullet) The
account owner should
complete a retirement
distribution form. Visit a
Fidelity Investor Center to
request one. Call
1-800-544-9797 for the
center nearest you.

TRUST
(small solid bullet) Bring a
letter of instruction to a
Fidelity Investor Center.
Call 1-800-544-9797 for the
center nearest you. The
trustee must sign the letter
of instruction indicating
capacity as trustee. If the
trustee's name is not in the
account registration,
provide a copy of the trust
document certified within
the last 60 days.

BUSINESS OR ORGANIZATION
(small solid bullet) Bring a
letter of instruction to a
Fidelity Investor Center.
Call 1-800-544-9797 for the
center nearest you. At least
one person authorized by
corporate resolution to act
on the account must sign the
letter of instruction.
(small solid bullet) Include
a corporate resolution with
corporate seal or a
signature guarantee.

EXECUTOR, ADMINISTRATOR,
CONSERVATOR, GUARDIAN
(small solid bullet) Visit a
Fidelity Investor Center for
instructions. Call
1-800-544-9797 for the
center nearest you.

EXCHANGING SHARES

An exchange involves the redemption of all or a portion of the shares
of one fund and the purchase of shares of another fund.

As a shareholder, you have the privilege of exchanging shares of the
fund for shares of other Fidelity funds, including each of the
underlying funds.

However, you should note the following policies and restrictions
governing exchanges:

(small solid bullet) The fund you are exchanging into must be
available for sale in your state.

(small solid bullet) You may exchange only between accounts that are
registered in the same name, address, and taxpayer identification
number.

(small solid bullet) Before exchanging into a fund, read its
prospectus.

(small solid bullet) Exchanges may have tax consequences for you.

(small solid bullet) The fund may temporarily or permanently terminate
the exchange privilege of any investor who makes more than four
exchanges out of the fund per calendar year.

(small solid bullet) The exchange limit may be modified for accounts
held by certain institutional retirement plans to conform to plan
exchange limits and Department of Labor regulations. See your plan
materials for further information.

(small solid bullet) The fund may refuse exchange purchases by any
person or group if, in Strategic Advisers' judgment, the fund would be
unable to invest the money effectively in accordance with its
investment objective and policies, or would otherwise potentially be
adversely affected.

The fund may terminate or modify the exchange privilege in the future.

Other funds may have different exchange restrictions, and may impose
administrative fees of up to 1.00% and trading fees of up to 3.00% of
the amount exchanged. Check each fund's prospectus for details.

ACCOUNT FEATURES AND POLICIES

FEATURES

The following features are available to buy and sell shares of the
fund.

AUTOMATIC INVESTMENT AND WITHDRAWAL PROGRAMS. Fidelity offers
convenient services that let you automatically transfer money into
your account, between accounts or out of your account. While automatic
investment programs do not guarantee a profit and will not protect you
against loss in a declining market, they can be an excellent way to
invest for retirement, a home, educational expenses, and other
long-term financial goals. Automatic withdrawal or exchange programs
can be a convenient way to provide a consistent income flow or to move
money between your investments.

<TABLE>
<CAPTION>
<S> <C> <C>
FIDELITY AUTOMATIC ACCOUNT
BUILDER TO MOVE MONEY FROM
YOUR BANK ACCOUNT TO A
FIDELITY FUND.

MINIMUM FREQUENCY PROCEDURES
$100 Monthly or quarterly (small solid bullet) To set
up for a new account,
complete the appropriate
section on the fund
application.

(small solid bullet) To set
up for existing accounts,
call 1-800-544-6666 or visit
Fidelity's Web site for an
application.

(small solid bullet) To make
changes, call 1-800-544-6666
at least three business days
prior to your next scheduled
investment date.

DIRECT DEPOSIT TO SEND ALL OR
A PORTION OF YOUR PAYCHECK
OR GOVERNMENT CHECK TO A
FIDELITY FUND.A

MINIMUM FREQUENCY PROCEDURES
$100 Every pay period (small solid bullet) To set
up for a new account, check
the appropriate box on the
fund application.

(small solid bullet) To set
up for an existing account,
call 1-800-544-6666 or visit
Fidelity's Web site for an
authorization form.

(small solid bullet) To make
changes you will need a new
authorization form. Call
1-800-544-6666 or visit
Fidelity's Web site to
obtain one.

A BECAUSE ITS SHARE PRICE
FLUCTUATES, THE FUND MAY NOT
BE AN APPROPRIATE CHOICE FOR
DIRECT DEPOSIT OF YOUR
ENTIRE CHECK.

FIDELITY AUTOMATIC EXCHANGE
SERVICE TO MOVE MONEY FROM A
FIDELITY MONEY MARKET FUND
TO ANOTHER FIDELITY FUND.

MINIMUM FREQUENCY PROCEDURES
$100 Monthly, bimonthly, (small solid bullet) To set
quarterly, or annually up, call 1-800-544-6666
after both accounts are
opened.

(small solid bullet) To make
changes, call 1-800-544-6666
at least three business days
prior to your next scheduled
exchange date.

</TABLE>

OTHER FEATURES. The following other features are also available to buy
and sell shares of the fund.

WIRE
TO PURCHASE AND SELL SHARES VIA THE FEDERAL RESERVE WIRE SYSTEM.

(small solid bullet) You must sign up for the Wire feature before
using it. Complete the appropriate section on the application when
opening your account, or call 1-800-544-7777 to add the feature after
your account is opened. Call 1-800-544-7777 before your first use to
verify that this feature is set up on your account.

(small solid bullet) To sell shares by wire, you must designate the
U.S. commercial bank account(s) into which you wish the redemption
proceeds deposited.

FIDELITY MONEY LINE
TO TRANSFER MONEY BETWEEN YOUR BANK ACCOUNT AND YOUR FUND ACCOUNT.

(small solid bullet) You must sign up for the Money Line feature
before using it. Complete the appropriate section on the application
and then call 1-800-544-7777 or visit Fidelity's Web site before your
first use to verify that this feature is set up on your account.

(small solid bullet) Most transfers are complete within three business
days of your call.

(small solid bullet) Maximum purchase: $100,000

FIDELITY ON-LINE XPRESS+(registered trademark)
TO MANAGE YOUR INVESTMENTS THROUGH YOUR PC.

CALL 1-800-544-7272 OR VISIT FIDELITY'S WEB SITE FOR MORE INFORMATION.
(small solid bullet) For account balances and holdings;

(small solid bullet) To review recent account history;

(small solid bullet) For mutual fund and brokerage trading; and

(small solid bullet) For access to research and analysis tools.

FIDELITY ONLINE TRADING
TO ACCESS AND MANAGE YOUR ACCOUNT OVER THE INTERNET AT FIDELITY'S WEB
SITE.

(small solid bullet) For account balances and holdings;

(small solid bullet) To review recent account history;

(small solid bullet) To obtain quotes;

(small solid bullet) For mutual fund and brokerage trading; and

(small solid bullet) To access third-party research on companies,
stocks, mutual funds and the market.

TOUCHTONE XPRESS
TO ACCESS AND MANAGE YOUR ACCOUNT AUTOMATICALLY BY PHONE.

CALL 1-800-544-5555.
(small solid bullet) For account balances and holdings;

(small solid bullet) For mutual fund and brokerage trading;

(small solid bullet) To obtain quotes;

(small solid bullet) To review orders and mutual fund activity; and

(small solid bullet) To change your personal identification number
(PIN).

POLICIES

The following policies apply to you as a shareholder.

STATEMENTS AND REPORTS that Fidelity sends to you include the
following:

(small solid bullet) Confirmation statements (after transactions
affecting your account balance except reinvestment of distributions in
the fund or another fund and certain transactions through automatic
investment or withdrawal programs).

(small solid bullet) Monthly or quarterly account statements
(detailing account balances and all transactions completed during the
prior month or quarter).

(small solid bullet) Financial reports (every six months).

To reduce expenses, only one copy of most financial reports and
prospectuses will be mailed to your household, even if you have more
than one account in the fund. Call Fidelity at 1-800-544-8544 if you
need additional copies of financial reports or prospectuses.

Electronic copies of most financial reports and prospectuses are
available at Fidelity's Web site. To participate in Fidelity's
electronic delivery program, call Fidelity or visit Fidelity's Web
site for more information.

You may initiate many TRANSACTIONS BY TELEPHONE OR ELECTRONICALLY.
Fidelity will not be responsible for any losses resulting from
unauthorized transactions if it follows reasonable security procedures
designed to verify the identity of the investor. Fidelity will request
personalized security codes or other information, and may also record
calls. For transactions conducted through the Internet, Fidelity
recommends the use of an Internet browser with 128-bit encryption. You
should verify the accuracy of your confirmation statements immediately
after you receive them. If you do not want the ability to sell and
exchange by telephone, call Fidelity for instructions.

When you sign your ACCOUNT APPLICATION, you will be asked to certify
that your social security or taxpayer identification number is correct
and that you are not subject to 31% backup withholding for failing to
report income to the IRS. If you violate IRS regulations, the IRS can
require the fund to withhold 31% of your taxable distributions and
redemptions.

The fund charges an ANNUAL INDEX ACCOUNT FEE of $10.00 per account to
offset shareholder service costs if your account balance falls below
$10,000 at the time of the December distribution. The index account
fee does not apply to assets held in employee benefit plans (including
Fidelity-sponsored 403(b) arrangements but otherwise as defined in the
Employee Retirement Income Security Act of 1974, excluding SIMPLE
IRAs, SEP IRAs and the Fidelity Retirement Plan) having more than 50
eligible employees or a minimum of $1,000,000 in plan assets that have
at least some portion of their assets invested in mutual funds advised
by FMR and which are marketed and distributed directly to plan
sponsors and participants without any assistance or intervention from
any intermediary distribution channel. In addition, this fee does not
apply to assets held in a Fidelity Traditional IRA or Fidelity
Rollover IRA purchased with proceeds of a distribution or transfer
from an employee benefit plan as described above, provided that at the
time of the distribution or transfer the employee benefit plan
satisfies the requirements described above.

Fidelity deducts $10.00 from each account at the time the December
distribution is credited to each account. If the amount of the
distribution is not sufficient to pay the fee, the index account fee
may be deducted directly from your account balance.

If your ACCOUNT BALANCE falls below $5,000 (except accounts not
subject to account minimums), you will be given 30 days' notice to
reestablish the minimum balance. If you do not increase your balance,
Fidelity may close your account and send the proceeds to you. Your
shares will be sold at the NAV, minus the short-term trading fee, if
applicable, on the day your account is closed.

Fidelity may charge a FEE FOR CERTAIN SERVICES, such as providing
historical account documents.

DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS

The fund earns dividends, interest and other income from its
investments, and distributes this income (less expenses) to
shareholders as dividends. The fund also realizes capital gains from
its investments, and distributes these gains (less any losses) to
shareholders as capital gains distributions.

The fund normally pays dividends and capital gains distributions in
April and December.

DISTRIBUTION OPTIONS

When you open an account, specify on your application how you want to
receive your distributions. The following options may be available for
the fund's distributions:

1. REINVESTMENT OPTION. Your dividends and capital gains distributions
will be automatically reinvested in additional shares of the fund. If
you do not indicate a choice on your application, you will be assigned
this option.

2. INCOME-EARNED OPTION. Your capital gains distributions will be
automatically reinvested in additional shares of the fund. Your
dividends will be paid in cash.

3. CASH OPTION. Your dividends and capital gains distributions will be
paid in cash.

4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividends
will be automatically invested in shares of another identically
registered Fidelity fund. Your capital gains distributions will be
automatically invested in shares of another identically registered
Fidelity fund, automatically reinvested in additional shares of the
fund, or paid in cash.

Not all distribution options are available for every account. If the
option you prefer is not listed on your account application, or if you
want to change your current option, call Fidelity.

If you elect to receive distributions paid in cash by check and the
U.S. Postal Service does not deliver your checks, your distribution
option may be converted to the Reinvestment Option. You will not
receive interest on amounts represented by uncashed distribution
checks.

TAX CONSEQUENCES

As with any investment, your investment in the fund could have tax
consequences for you. If you are not investing through a
tax-advantaged retirement account, you should consider these tax
consequences.

TAXES ON DISTRIBUTIONS. Distributions you receive from the fund are
subject to federal income tax, and may also be subject to state or
local taxes.

For federal tax purposes, the fund's dividends and distributions of
short-term capital gains are taxable to you as ordinary income. The
fund's distributions of long-term capital gains are taxable to you
generally as capital gains.

If you buy shares when a fund has realized but not yet distributed
income or capital gains, you will be "buying a dividend" by paying the
full price for the shares and then receiving a portion of the price
back in the form of a taxable distribution.

Any taxable distributions you receive from the fund will normally be
taxable to you when you receive them, regardless of your distribution
option.

TAXES ON TRANSACTIONS. Your redemptions, including exchanges, may
result in a capital gain or loss for federal tax purposes. A capital
gain or loss on your investment in the fund is the difference between
the cost of your shares and the price you receive when you sell them.

FUND SERVICES

FUND MANAGEMENT

Four-in-One Index Fund is a mutual fund, an investment that pools
shareholders' money and invests it toward a specified goal.

Strategic Advisers, Inc. (Strategic Advisers) is Four-in-One Index's
investment manager.

Fidelity Management & Research Company (FMR), an affiliate of
Strategic Advisers, is each underlying Fidelity fund's manager.

As of ___ __, 199_, Strategic Advisers had approximately $___ in
discretionary assets under management.

As of ___ __, 199_, FMR had approximately $____ in discretionary
assets under management.

As the manager, Strategic Advisers administers the asset allocation
program for Four-in-One Index.

FMR is also responsible for handling the business affairs for
Four-in-One Index.

As the manager for the underlying Fidelity funds, FMR is responsible
for handling each underlying fund's business affairs. As the manager
for U.S. Bond Index, FMR is also responsible for choosing the fund's
investments.

Banker's Trust Company (BT) serves as sub-adviser and custodian for
Spartan Market Index, Spartan Extended Market Index and Spartan
International Index (the Stock Index Funds). BT chooses the Stock
Index Funds' investments, and places orders to buy, sell and lend the
Stock Index Funds' investments. As of ___ __, 199_, BT had
approximately $____ in discretionary assets under management. BT's
principal offices are at 130 Liberty Street, New York, New York 10006.

BT is a wholly owned subsidiary of Bankers Trust Corporation. On
November 30, 1998, Bankers Trust Corporation entered into an Agreement
and Plan of Merger with Deutsche Bank AG under which Bankers Trust
Corporation and all of its subsidiaries would merge with and into a
subsidiary of Deutsche Bank AG. The merger is contingent on various
regulatory approvals. At a meeting held on March 18, 1999, each Stock
Index Fund's Board of Trustees approved a new subadvisory agreement
among each Stock Index Fund, FMR and BT or its successor by merger
that would be effective at the time of the merger and will be
presented to each Stock Index Fund's shareholders for approval.

On March 11, 1999, BT announced that it had reached an agreement with
the United States Attorney's Office in the Southern District of New
York to resolve an investigation concerning inappropriate transfers of
unclaimed funds and related record-keeping problems that occurred
between 1994 and early 1996. Pursuant to its agreement with the U.S.
Attorney's Office, BT pleaded guilty to misstating entries in the
bank's books and records and agreed to pay a $60 million fine to
federal authorities. Separately, BT agreed to pay a $3.5 million fine
to the State of New York. The events leading up the the guilty plea
did not arise out of the investment advisory or mutual fund management
activities of BT or its affiliates.

As a result of the plea, absent an order from the SEC, BT would not be
able to continue to provide investment advisory services to the funds.
The SEC has granted a temporary order to permit BT and its affiliates
to continue to provide investment advisory services to registered
investment companies. There is no assurance that the SEC will grant a
permanent order.

The fund could be adversely affected if the computer systems used by
Strategic Advisers, FMR and other service providers do not properly
process and calculate date-related information from and after January
1, 2000. Strategic Advisers and FMR have advised the fund that they
are actively working on necessary changes to their computer systems
and expects that their systems, and those of other major service
providers, will be modified prior to January 1, 2000. However, there
can be no assurance that there will be no adverse impact on a fund.

Fidelity investment personnel may invest in securities for their own
investment accounts pursuant to a code of ethics that establishes
procedures for personal investing and restricts certain transactions.

Four-in-One Index pays a management fee to Strategic Advisers.

The management fee is calculated and paid to Strategic Advisers every
month.

Strategic Advisers is responsible for the payment of all other
expenses of Four-in-One Index with limited exceptions.

Four-in-One Index's annual management fee rate is __% of its average
net assets.

Strategic Advisers pays FMR an administration fee for handling the
business affairs for Four-in-One Index.

Strategic Advisers may, from time to time, agree to reimburse the fund
for management fees above a specified limit. Strategic Advisers
retains the ability to be repaid by the fund if expenses fall below
the specified limit prior to the end of the fiscal year. Reimbursement
arrangements, which may be terminated by Strategic Advisers at any
time, can decrease the fund's expenses and boost its performance.

FUND DISTRIBUTION

Fidelity Distributors Corporation, Inc. (FDC) distributes the fund's
shares.

Four-in-One Index has adopted a Distribution and Service Plan pursuant
to Rule 12b-1 under the Investment Company Act of 1940 that recognizes
that Strategic Advisers or FMR may use its management or
administration fee revenues, respectively, as well as its past profits
or its resources from any other source, to pay FDC for expenses
incurred in connection with providing services intended to result in
the sale of Four-in-One Index shares and/or shareholder support
services. Strategic Advisers or FMR, directly or through FDC, may pay
intermediaries, such as banks, broker-dealers and other
service-providers, that provide those services. Currently, the Board
of Trustees of Four-in-One Index has authorized such payments.

To receive payments made pursuant to a Distribution and Service Plan,
intermediaries must sign the appropriate agreement with FDC in
advance.

Strategic Advisers and FMR may allocate brokerage transactions in a
manner that takes into account the sale of shares of the fund,
provided that the fund receives brokerage services and commission
rates comparable to those of other broker-dealers.

No dealer, sales representative, or any other person has been
authorized to give any information or to make any representations,
other than those contained in this Prospectus and in the related
Statement of Additional Information (SAI), in connection with the
offer contained in this Prospectus. If given or made, such other
information or representations must not be relied upon as having been
authorized by the fund or FDC. This Prospectus and the related SAI do
not constitute an offer by the fund or by FDC to sell shares of the
fund to or to buy shares of the fund from any person to whom it is
unlawful to make such offer.

APPENDIX

ADDITIONAL INFORMATION ABOUT THE INDEXES

S&P does not guarantee the accuracy and/or the completeness of the S&P
500 Index or any data included therein and S&P shall have no liability
for any errors, omissions, or interruptions therein. S&P makes no
warranty, express or implied, as to results to be obtained by
licensee, owners of the product, or any other person or entity from
the use of the S&P 500 Index or any data included therein. S&P makes
no express or implied warranties, and expressly disclaims all
warranties of merchantability or fitness for a particular purpose or
use with respect to the S&P 500 Index or any data included therein.
Without limiting any of the foregoing, in no event shall S&P have any
liability for any special, punitive, indirect, or consequential
damages (including lost profits), even if notified of the possibility
of such damages.

The product is not sponsored, endorsed, sold or promoted by S&P. S&P
makes no representation or warranty, express or implied, to the owners
of the Product or any member of the public regarding the advisability
of investing in securities generally or in the product particularly or
the ability of the S&P 500 Index to track general stock market
performance. S&P's only relationship to the licensee is the licensing
of certain trademarks and trade names of S&P and of the S&P 500 Index
which is determined, composed, and calculated by S&P without regard to
the licensee or the product. S&P has no obligation to take the needs
of the licensee or the owners of the product into consideration in
determining, composing, or calculating the S&P 500 Index. S&P is not
responsible for and has not participated in the determination of the
timing of, prices at, or quantities of the product to be issued or in
the determination or calculation of the equation by which the product
is to be converted into cash. S&P has no obligation or liability in
connection with the administration, marketing or trading of the
product.

"Standard & Poor's," "S&P," "S&P 500," "Standard & Poor's 500," and
"500" are trademarks of The McGraw-Hill, Companies, Inc. and have been
licensed for

The Wilshire 5000 and the Wilshire 4500 are compiled by Wilshire
Associates Incorporated, which is neither as affiliate nor a sponsor
of Spartan Total Market Index or Spartan Extended Market Index.
Spartan International Index Fund is not sponsored, endorsed, sold or
promoted by Morgan Stanley & Co. incorporated (Morgan Stanley). Morgan
Stanley makes no representation warranty, express or implied, to the
owners of the fund or any member of the public regarding the
advisability of investing securities generally or in the fund
particularly or the ability of the EAFE(registered trademark) Index to
track general stock market performance. Morgan Stanley is the licensor
of certain trademarks, service marks and trade names of Morgan Stanley
and of the EAFE Index. Morgan Stanley has no obligation to take the
needs of the issuer of the fund or the owners of the fund into
consideration in determining, composing or calculating the EAFE Index.
Morgan Stanley is not responsible for and has not participated in the
determination of the timing of, prices at, or quantities of the fund
to be issued or in the determination or calculation of the equation by
which the fund is redeemable for cash. Morgan Stanley has no
obligation or liability to owners of the fund in connection with the
administration, marketing or trading the fund.

Although Morgan Stanley shall obtain information for inclusions in or
for use in the calculation of the index from sources which Morgan
Stanley considers reliable, Morgan Stanley does not guarantee the
accuracy and/or the completeness of the index or any data included
therein. Morgan Stanley makes no warranty, express or implied, as to
results to be obtained by licensee, licensee's customers and
counterparties, owners of the product, or any other person or entity
from the use of the index or any data included therein in connection
with the rights licensed hereunder or for any other use. Morgan
Stanley makes no express or implied warranties, and hereby expressly
disclaims all warranties of merchantability or fitness for a
particular purpose with respect to the index or any data included
therein. Without limiting any of the foregoing, in no event shall
Morgan Stanley have any liability for any direct, indirect, special,
punitive, consequential or any other damages (including lost profits)
even if notified of the possibility of such damages.

Inclusion of a security in the Lehman Brothers Aggregate Bond Index
(the Index) in no way implies an opinion by Lehman Brothers, Inc. as
to its attractiveness or appropriateness as an investment for the
fund. Lehman Brothers, Inc. is neither an affiliate nor sponsor of the
fund and inclusion of a security in the Index does not imply that it
is a good investment.

You can obtain additional information about the fund. The fund's SAI
includes more detailed information about the fund and its investments.
The SAI is incorporated herein by reference (legally forms a part of
the prospectus). A financial report will be available once the fund
has completed its first annual or semi-annual period. The fund's
annual and semi-annual reports include a discussion of the fund's
holdings and recent market conditions and the fund's investment
strategies that affected performance.

For a free copy of any of these documents or to request other
information or ask questions about the fund, call Fidelity at
1-800-544-8544 or visit Fidelity's Web site at www.fidelity.com.

The SAI, the fund's annual and semi-annual reports and other related
materials are available on the SEC's Internet Web site
(http://www.sec.gov). You can obtain copies of this information upon
paying a duplicating fee, by writing the Public Reference Section of
the SEC, Washington, D.C. 20549-6009. You can also review and copy
information about the fund, including the fund's SAIs, at the SEC's
Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for
information on the operation of the SEC's Public Reference Room.

INVESTMENT COMPANY ACT OF 1940, FILE NUMBER, 811-3480

Fidelity, Fidelity Investments & (Pyramid) Design, Spartan, Fidelity
Investments, TouchTone Xpress, Fidelity Money Line, Fidelity Automatic
Account Builder, Fidelity On-Line Xpress+ and Directed Dividends are
registered trademarks of FMR Corp.

Strategic Advisers and Portfolio Advisory Services are service marks
of FMR Corp.

[item code]. IDV-pro-0699

FIDELITY FOUR-IN-ONE INDEX FUND
A FUND OF FIDELITY OXFORD STREET TRUST

STATEMENT OF ADDITIONAL INFORMATION
JUNE 26, 1999

This Statement of Additional Information (SAI) is not a prospectus.
To obtain a free additional copy of the Prospectus, dated June 26,
1999, please call Fidelity(registered trademark) at 1-800-544-8544 or
visit Fidelity's Web site at www.fidelity.com.

TABLE OF CONTENTS PAGE

Investment Policies and 16
Limitations

Special Considerations 24
Regarding Europe

Special Considerations 26
Regarding Asia

Portfolio Transactions 32

Valuation 33

Performance 34

Additional Purchase, Exchange 38
and Redemption Information

Distributions and Taxes 38

Trustees and Officers 39

Control of Investment Advisers 41

Management Contract 41

Distribution Services 42

Transfer and Service Agent 42
Agreements

Description of the Fund 42

Appendix 43

IDV-ptb-0299
[item code]

(fidelity_logo_graphic)(registered trademark)
82 Devonshire Street, Boston, MA 02109

INVESTMENT POLICIES AND LIMITATIONS

The following policies and limitations supplement those set forth in
the Prospectus. Unless otherwise noted, whenever an investment policy
or limitation states a maximum percentage of Four-in-One Index's
assets that may be invested in any security or other asset, or sets
forth a policy regarding quality standards, such standard or
percentage limitation will be determined immediately after and as a
result of Four-in-One Index's acquisition of such security or other
asset. Accordingly, any subsequent change in values, net assets, or
other circumstances will not be considered when determining whether
the investment complies with Four-in-One Index's investment policies
and limitations.

Four-in-One Index's fundamental investment policies and limitations
cannot be changed without approval by a "majority of the outstanding
voting securities" (as defined in the Investment Company Act of 1940
(the 1940 Act)) of the fund. However, except for the fundamental
investment limitations listed below, the investment policies and
limitations described in this SAI are not fundamental and may be
changed without shareholder approval.

THE FOLLOWING ARE FOUR-IN-ONE INDEX'S FUNDAMENTAL INVESTMENT
LIMITATIONS SET FORTH IN THEIR ENTIRETY. FOUR-IN-ONE INDEX MAY NOT:

(1) with respect to 75% of the fund's total assets, purchase the
securities of any issuer (other than securities issued or guaranteed
by the U.S. Government or any of its agencies or instrumentalities, or
securities of other investment companies) if, as a result, (a) more
than 5% of the fund's total assets would be invested in the securities
of that issuer, or (b) the fund would hold more than 10% of the
outstanding voting securities of that issuer;

(2) issue senior securities, except in connection with the insurance
program established by the fund pursuant to an exemptive order issued
by the Securities and Exchange Commission or as otherwise permitted
under the Investment Company Act of 1940;

(3) borrow money, except that the fund may borrow money for temporary
or emergency purposes (not for leveraging or investment) in an amount
not exceeding 33 1/3% of its total assets (including the amount
borrowed) less liabilities (other than borrowings). Any borrowings
that come to exceed this amount will be reduced within three days (not
including Sundays and holidays) to the extent necessary to comply with
the 33 1/3% limitation;

(4) underwrite securities issued by others, except to the extent that
the fund may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;

(5) purchase the securities of any issuer (other than securities
issued or guaranteed by the U.S. Government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose
principal business activities are in the same industry (provided that
investments in other investment companies shall not be considered an
investment in any particular industry for purposes of this investment
limitation);

(6) purchase or sell real estate unless acquired as a result of
ownership of securities or other instruments (but this shall not
prevent the fund from investing in securities or other instruments
backed by real estate or securities of companies engaged in the real
estate business);

(7) purchase or sell physical commodities unless acquired as a result
of ownership of securities or other instruments (but this shall not
prevent the fund from purchasing or selling options and futures
contracts or from investing in securities or other instruments backed
by physical commodities); or

(8) lend any security or make any other loan, if, as a result, more
than 33 1/3% of its total assets would be lent to other parties, but
this limitation does not apply to purchases of debt securities or to
repurchase agreements.

(9) The fund may, notwithstanding any other fundamental investment
policy or limitation, invest all of its assets in the securities of a
single open-end management investment company managed by Fidelity
Management & Research Company or an affiliate or successor with
substantially the same fundamental investment objective, policies, and
limitations as the fund.

THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.

(i) The fund does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in
kind and amount to the securities sold short, and provided that
transactions in futures contracts and options are not deemed to
constitute selling securities short.

(ii) The fund does not currently intend to purchase securities on
margin, except that the fund may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin.

(iii) The fund may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) by engaging in reverse
repurchase agreements with any party (reverse repurchase agreements
are treated as borrowings for purposes of fundamental investment
limitation (3)). The fund will not borrow from other funds advised by
FMR or its affiliates if total outstanding borrowings immediately
after such borrowing would exceed 15% of the fund's total assets.

(iv) The fund does not currently intend to purchase any security if,
as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to
legal or contractual restrictions on resale or because they cannot be
sold or disposed of in the ordinary course of business at
approximately the prices at which they are valued.

(v) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 7.5%
of the fund's net assets) to a registered investment company or
portfolio for which FMR or an affiliate serves as investment adviser
or (b) acquiring loans, loan participations, or other forms of direct
debt instruments and, in connection therewith, assuming any associated
unfunded commitments of the sellers. (This limitation does not apply
to purchases of debt securities or to repurchase agreements.)

(vi) The fund does not currently intend to invest all of its assets in
the securities of a single open-end management investment company
managed by Fidelity Management & Research Company or an affiliate or
successor with substantially the same fundamental investment
objective, policies, and limitations as the fund.

With respect to limitation (iv), if through a change in values, net
assets, or other circumstances, the fund were in a position where more
than 10% of its net assets was invested in illiquid securities, it
would consider appropriate steps to protect liquidity.

For the fund's limitations on futures and options transactions, see
the section entitled "Limitations on Futures and Options Transactions"
on page __.

Notwithstanding the foregoing investment limitations, the underlying
Fidelity funds in which Four-in-One Index may invest have adopted
certain investment limitations that may be more or less restrictive
than those listed above, thereby permitting Four-in-One Index to
engage indirectly in investment strategies that are prohibited under
the investment limitations listed above. The investment limitations of
each underlying Fidelity fund are set forth in its SAI.

In accordance with Four-in-One Index's investment program as set forth
in the prospectus, the fund may invest more than 25% of its assets in
any one underlying Fidelity fund. However, each of the underlying
Fidelity funds in which Four-in-One Index may invest will not
concentrate more than 25% of its total assets in any one industry.

INVESTMENT PRACTICES OF FOUR-IN-ONE INDEX FUND

The following pages contain more detailed information about types of
instruments in which Four-in-One Index may invest, strategies
Strategic AdvisersSM may employ in pursuit of Four-in-One Index's
investment objective, and a summary of related risks. Strategic
Advisers may not buy all of these instruments or use all of these
techniques unless it believes that doing so will help Four-in-One
Index achieve its goal.

BORROWING. Four-in-One Index may borrow from banks or from other funds
advised by Fidelity Management & Research Company (FMR) or its
affiliates, or through reverse repurchase agreements. If the fund
borrows money, its share price may be subject to greater fluctuation
until the borrowing is paid off. If the fund makes additional
investments while borrowings are outstanding, this may be considered a
form of leverage.

CASH MANAGEMENT. A fund can hold uninvested cash or can invest it in
cash equivalents such as money market securities, repurchase
agreements or shares of money market funds. Generally, these
securities offer less potential for gains than other types of
securities.

CENTRAL CASH FUNDS are money market funds managed by FMR or its
affiliates that seek to earn a high level of current income (free from
federal income tax in the case of a municipal money market fund) while
maintaining a stable $1.00 share price. The funds comply with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of their investments.

DOLLAR-WEIGHTED AVERAGE MATURITY is derived by multiplying the value
of each investment by the time remaining to its maturity, adding these
calculations, and then dividing the total by the value of the fund's
portfolio. An obligation's maturity is typically determined on a
stated final maturity basis, although there are some exceptions to
this rule.

For example, if it is probable that the issuer of an instrument will
take advantage of a maturity-shortening device, such as a call,
refunding, or redemption provision, the date on which the instrument
will probably be called, refunded, or redeemed may be considered to be
its maturity date. Also, the maturities of mortgage securities,
including collateralized mortgage obligations, and some asset-backed
securities are determined on a weighted average life basis, which is
the average time for principal to be repaid. For a mortgage security,
this average time is calculated by estimating the timing of principal
payments, including unscheduled prepayments, during the life of the
mortgage. The weighted average life of these securities is likely to
be substantially shorter than their stated final maturity.

FUTURES CONTRACTS. In purchasing a futures contract, the buyer agrees
to purchase a specified underlying instrument at a specified future
date. In selling a futures contract, the seller agrees to sell a
specified underlying instrument at a specified future date. The price
at which the purchase and sale will take place is fixed when the buyer
and seller enter into the contract. Some currently available futures
contracts are based on specific securities, such as U.S. Treasury
bonds or notes, and some are based on indices of securities prices,
such as the Standard & Poor's 500 Index (S&P 500(registered
trademark)). Futures can be held until their delivery dates, or can be
closed out before then if a liquid secondary market is available.

The value of a futures contract tends to increase and decrease in
tandem with the value of its underlying instrument. Therefore,
purchasing futures contracts will tend to increase a fund's exposure
to positive and negative price fluctuations in the underlying
instrument, much as if it had purchased the underlying instrument
directly. When a fund sells a futures contract, by contrast, the value
of its futures position will tend to move in a direction contrary to
the market. Selling futures contracts, therefore, will tend to offset
both positive and negative market price changes, much as if the
underlying instrument had been sold.

LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. The fund intends to
file a notice of eligibility for exclusion from the definition of the
term "commodity pool operator" with the Commodity Futures Trading
Commission (CFTC) and the National Futures Association, which regulate
trading in the futures markets, before engaging in any purchases or
sales of futures contracts or options on futures contracts. The fund
intends to comply with Rule 4.5 under the Commodity Exchange Act,
which limits the extent to which the fund can commit assets to initial
margin deposits and option premiums.

In addition, the fund will not: (a) sell futures contracts, purchase
put options, or write call options if, as a result, more than 25% of
the fund's total assets would be hedged with futures and options under
normal conditions; (b) purchase futures contracts or write put options
if, as a result, the fund's total obligations upon settlement or
exercise of purchased futures contracts and written put options would
exceed 25% of its total assets under normal conditions; or (c)
purchase call options if, as a result, the current value of option
premiums for call options purchased by the fund would exceed 5% of the
fund's total assets. These limitations do not apply to options
attached to or acquired or traded together with their underlying
securities, and do not apply to securities that incorporate features
similar to options.

The above limitations on the fund's investments in futures contracts
and options, and the fund's policies regarding futures contracts and
options discussed elsewhere in this SAI, may be changed as regulatory
agencies permit.

ILLIQUID SECURITIES cannot be sold or disposed of in the ordinary
course of business at approximately the prices at which they are
valued. Difficulty in selling securities may result in a loss or may
be costly to a fund. Under the supervision of the Board of Trustees,
FMR, on behalf of Strategic Advisers, determines the liquidity of a
fund's investments and, through reports from FMR, the Board monitors
investments in illiquid securities. In determining the liquidity of a
fund's investments, FMR may consider various factors, including (1)
the frequency and volume of trades and quotations, (2) the number of
dealers and prospective purchasers in the marketplace, (3) dealer
undertakings to make a market and (4) the nature of the security and
the market in which it trades (including any demand, put or tender
features, the mechanics and other requirements for transfer, any
letters of credit or other credit enhancement features, any ratings,
the number of holders, the method of soliciting offers, the time
required to dispose of the security, and the ability to assign or
offset the rights and obligations of the security).

INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive
order issued by the Securities and Exchange Commission (SEC), a fund
may lend money to, and borrow money from, other funds advised by FMR
or its affiliates. A fund will lend through the program only when the
returns are higher than those available from an investment in
repurchase agreements, and will borrow through the program only when
the costs are equal to or lower than the cost of bank loans. Interfund
loans and borrowings normally extend overnight, but can have a maximum
duration of seven days. Loans may be called on one day's notice. A
fund may have to borrow from a bank at a higher interest rate if an
interfund loan is called or not renewed. Any delay in repayment to a
lending fund could result in a lost investment opportunity or
additional borrowing costs.

INVESTMENT-GRADE DEBT SECURITIES. Investment-grade debt securities are
medium and high-quality securities. Some may possess speculative
characteristics and may be more sensitive to economic changes and to
changes in the financial conditions of issuers. A debt security is
considered to be investment-grade if it is rated investment-grade by
Moody's Investors Service, Standard & Poor's, Duff & Phelps Credit
Rating Co., or Fitch IBCA Inc., or is unrated but considered to be of
equivalent quality by FMR.

REPURCHASE AGREEMENTS involve an agreement to purchase a security and
to sell that security back to the original seller at an agreed-upon
price. The resale price reflects the purchase price plus an
agreed-upon incremental amount which is unrelated to the coupon rate
or maturity of the purchased security. As protection against the risk
that the original seller will not fulfill its obligation, the
securities are held in a separate account at a bank, marked-to-market
daily, and maintained at a value at least equal to the sale price plus
the accrued incremental amount. The value of the security purchased
may be more or less than the price at which the counterparty has
agreed to purchase the security. In addition, delays or losses could
result if the other party to the agreement defaults or becomes
insolvent. Four-in-One Index will engage in repurchase agreement
transactions with parties whose creditworthiness has been reviewed and
found satisfactory by FMR on behalf of Strategic Advisers.

RESTRICTED SECURITIES are subject to legal restrictions on their sale.
Difficulty in selling securities may result in a loss or be costly to
a fund. Restricted securities generally can be sold in privately
negotiated transactions, pursuant to an exemption from registration
under the Securities Act of 1933, or in a registered public offering.
Where registration is required, the holder of a registered security
may be obligated to pay all or part of the registration expense and a
considerable period may elapse between the time it decides to seek
registration and the time it may be permitted to sell a security under
an effective registration statement. If, during such a period, adverse
market conditions were to develop, the holder might obtain a less
favorable price than prevailed when it decided to seek registration of
the security.

REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a
fund sells a security to another party, such as a bank or
broker-dealer, in return for cash and agrees to repurchase that
security at an agreed-upon price and time. Four-in-One Index will
enter into reverse repurchase agreements with parties whose
creditworthiness has been reviewed and found satisfactory by FMR on
behalf of Strategic Advisers. Such transactions may increase
fluctuations in the market value of fund assets and may be viewed as a
form of leverage.

SECURITIES LENDING. A fund may lend securities to parties such as
broker-dealers or other institutions, including Fidelity Brokerage
Services, Inc. (FBSI). FBSI is a member of the New York Stock Exchange
and a subsidiary of FMR Corp.

Securities lending allows a fund to retain ownership of the securities
loaned and, at the same time, to earn additional income. Because there
may be delays in the recovery of loaned securities, or even a loss of
rights in collateral supplied should the borrower fail financially,
loans will be made only to parties deemed by Strategic Advisers to be
of good standing. Furthermore, they will only be made if, in Strategic
Advisers's judgment, the consideration to be earned from such loans
would justify the risk.

Strategic Advisers understands that it is the current view of the SEC
Staff that a fund may engage in loan transactions only under the
following conditions: (1) the fund must receive 100% collateral in the
form of cash or cash equivalents (e.g., U.S. Treasury bills or notes)
from the borrower; (2) the borrower must increase the collateral
whenever the market value of the securities loaned (determined on a
daily basis) rises above the value of the collateral; (3) after giving
notice, the fund must be able to terminate the loan at any time; (4)
the fund must receive reasonable interest on the loan or a flat fee
from the borrower, as well as amounts equivalent to any dividends,
interest, or other distributions on the securities loaned and to any
increase in market value; (5) the fund may pay only reasonable
custodian fees in connection with the loan; and (6) the Board of
Trustees must be able to vote proxies on the securities loaned, either
by terminating the loan or by entering into an alternative arrangement
with the borrower.

SOURCES OF CREDIT OR LIQUIDITY SUPPORT. Issuers may employ various
forms of credit and liquidity enhancements, including letters of
credit, guarantees, puts, and demand features, and insurance provided
by domestic or foreign entities such as banks and other financial
institutions. Strategic Advisers may rely on FMR's evaluation of the
credit of the credit or liquidity enhancement provider in determining
whether to purchase a security supported by such enhancement. In
evaluating the credit of a foreign bank or other foreign entities, FMR
will consider whether adequate public information about the entity is
available and whether the entity may be subject to unfavorable
political or economic developments, currency controls, or other
government restrictions that might affect its ability to honor its
commitment. Changes in the credit quality of the entity providing the
enhancement could affect the value of the security or a fund's share
price.

TEMPORARY DEFENSIVE POLICIES. The fund reserves the right to invest
without limitation in investment-grade money market instruments for
temporary, defensive purposes.

INVESTMENT PRACTICES OF THE UNDERLYING FIDELITY FUNDS

The following pages contain more detailed information about types of
instruments in which an underlying Fidelity fund may invest,
strategies FMR or Bankers Trust Company (BT), as applicable, may
employ in pursuit of an underlying Fidelity fund's investment
objective, and a summary of related risks. FMR or BT, as applicable,
may not buy all of these instruments or use all of these techniques
unless it believes that doing so will help an underlying Fidelity fund
achieve its goal.

AFFILIATED BANK TRANSACTIONS. A fund may engage in transactions with
financial institutions that are, or may be considered to be,
"affiliated persons" of the fund under the 1940 Act. These
transactions may involve repurchase agreements with custodian banks;
short-term obligations of, and repurchase agreements with, the 50
largest U.S. banks (measured by deposits); municipal securities; U.S.
Government securities with affiliated financial institutions that are
primary dealers in these securities; short-term currency transactions;
and short-term borrowings. In accordance with exemptive orders issued
by the SEC, the Board of Trustees has established and periodically
reviews procedures applicable to transactions involving affiliated
financial institutions.

ASSET-BACKED SECURITIES represent interests in pools of mortgages,
loans, receivables or other assets. Payment of interest and repayment
of principal may be largely dependent upon the cash flows generated by
the assets backing the securities and, in certain cases, supported by
letters of credit, surety bonds, or other credit enhancements.
Asset-backed security values may also be affected by other factors
including changes in interest rates, the availability of information
concerning the pool and its structure, the creditworthiness of the
servicing agent for the pool, the originator of the loans or
receivables, or the entities providing the credit enhancement. In
addition, these securities may be subject to prepayment risk.

BORROWING. Each fund may borrow from banks or from other funds advised
by FMR or its affiliates, or through reverse repurchase agreements. If
a fund borrows money, its share price may be subject to greater
fluctuation until the borrowing is paid off. If a fund makes
additional investments while borrowings are outstanding, this may be
considered a form of leverage.

COMMON STOCK represents an equity or ownership interest in an issuer.
In the event an issuer is liquidated or declares bankruptcy, the
claims of owners of bonds and preferred stock take precedence over the
claims of those who own common stock.

CONVERTIBLE SECURITIES are bonds, debentures, notes, preferred stocks
or other securities that may be converted or exchanged (by the holder
or by the issuer) into shares of the underlying common stock (or cash
or securities of equivalent value) at a stated exchange ratio. A
convertible security may also be called for redemption or conversion
by the issuer after a particular date and under certain circumstances
(including a specified price) established upon issue. If a convertible
security held by a fund is called for redemption or conversion, the
fund could be required to tender it for redemption, convert it into
the underlying common stock, or sell it to a third party.

Convertible securities generally have less potential for gain or loss
than common stocks. Convertible securities generally provide yields
higher than the underlying common stocks, but generally lower than
comparable non-convertible securities. Because of this higher yield,
convertible securities generally sell at prices above their
"conversion value," which is the current market value of the stock to
be received upon conversion. The difference between this conversion
value and the price of convertible securities will vary over time
depending on changes in the value of the underlying common stocks and
interest rates. When the underlying common stocks decline in value,
convertible securities will tend not to decline to the same extent
because of the interest or dividend payments and the repayment of
principal at maturity for certain types of convertible securities.
However, securities that are convertible other than at the option of
the holder generally do not limit the potential for loss to the same
extent as securities convertible at the option of the holder. When the
underlying common stocks rise in value, the value of convertible
securities may also be expected to increase. At the same time,
however, the difference between the market value of convertible
securities and their conversion value will narrow, which means that
the value of convertible securities will generally not increase to the
same extent as the value of the underlying common stocks. Because
convertible securities may also be interest-rate sensitive, their
value may increase as interest rates fall and decrease as interest
rates rise. Convertible securities are also subject to credit risk,
and are often lower-quality securities.

DEBT SECURITIES are used by issuers to borrow money. The issuer
usually pays a fixed, variable or floating rate of interest, and must
repay the amount borrowed at the maturity of the security. Some debt
securities, such as zero coupon bonds, do not pay interest but are
sold at a deep discount from their face values. Debt securities
include corporate bonds, government securities, and mortgage and other
asset-backed securities.

EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies,
and securities issued by U.S. entities with substantial foreign
operations may involve significant risks in addition to the risks
inherent in U.S. investments.

Foreign investments involve risks relating to local political,
economic, regulatory, or social instability, military action or
unrest, or adverse diplomatic developments, and may be affected by
actions of foreign governments adverse to the interests of U.S.
investors. Such actions may include expropriation or nationalization
of assets, confiscatory taxation, restrictions on U.S. investment or
on the ability to repatriate assets or convert currency into U.S.
dollars, or other government intervention. Additionally, governmental
issuers of foreign debt securities may be unwilling to pay interest
and repay principal when due and may require that the conditions for
payment be renegotiated. There is no assurance that FMR or BT, as
applicable, will be able to anticipate these potential events or
counter their effects. In addition, the value of securities
denominated in foreign currencies and of dividends and interest paid
with respect to such securities will fluctuate based on the relative
strength of the U.S. dollar.

It is anticipated that in most cases the best available market for
foreign securities will be on an exchange or in over-the-counter (OTC)
markets located outside of the United States. Foreign stock markets,
while growing in volume and sophistication, are generally not as
developed as those in the United States, and securities of some
foreign issuers may be less liquid and more volatile than securities
of comparable U.S. issuers. Foreign security trading, settlement and
custodial practices (including those involving securities settlement
where fund assets may be released prior to receipt of payment) are
often less developed than those in U.S. markets, and may result in
increased risk or substantial delays in the event of a failed trade or
the insolvency of, or breach of duty by, a foreign broker-dealer,
securities depository or foreign subcustodian. For example, many
foreign countries are less prepared than the United States to properly
process and calculate information related to dates from and after
January 1, 2000. As a result, some foreign markets, brokers, banks or
securities depositories could experience at least temporary
disruptions, which could result in difficulty buying and selling
securities in certain foreign markets and pricing foreign investments,
and foreign issuers could fail to pay timely dividends, interest or
principal. In addition, the costs associated with foreign investments,
including withholding taxes, brokerage commissions and custodial
costs, are generally higher than with U.S. investments.

Foreign markets may offer less protection to investors than U.S.
markets. Foreign issuers are generally not bound by uniform
accounting, auditing, and financial reporting requirements and
standards of practice comparable to those applicable to U.S. issuers.
Adequate public information on foreign issuers may not be available,
and it may be difficult to secure dividends and information regarding
corporate actions on a timely basis. In general, there is less overall
governmental supervision and regulation of securities exchanges,
brokers, and listed companies than in the United States. OTC markets
tend to be less regulated than stock exchange markets and, in certain
countries, may be totally unregulated. Regulatory enforcement may be
influenced by economic or political concerns, and investors may have
difficulty enforcing their legal rights in foreign countries.

Some foreign securities impose restrictions on transfer within the
United States or to U.S. persons. Although securities subject to such
transfer restrictions may be marketable abroad, they may be less
liquid than foreign securities of the same class that are not subject
to such restrictions.

American Depositary Receipts (ADRs) as well as other "hybrid" forms of
ADRs, including European Depositary Receipts (EDRs) and Global
Depositary Receipts (GDRs), are certificates evidencing ownership of
shares of a foreign issuer. These certificates are issued by
depository banks and generally trade on an established market in the
United States or elsewhere. The underlying shares are held in trust by
a custodian bank or similar financial institution in the issuer's home
country. The depository bank may not have physical custody of the
underlying securities at all times and may charge fees for various
services, including forwarding dividends and interest and corporate
actions. ADRs are alternatives to directly purchasing the underlying
foreign securities in their national markets and currencies. However,
ADRs continue to be subject to many of the risks associated with
investing directly in foreign securities. These risks include foreign
exchange risk as well as the political and economic risks of the
underlying issuer's country.

The risks of foreign investing may be magnified for investments in
emerging markets. Security prices in emerging markets can be
significantly more volatile than those in more developed markets,
reflecting the greater uncertainties of investing in less established
markets and economies. In particular, countries with emerging markets
may have relatively unstable governments, may present the risks of
nationalization of businesses, restrictions on foreign ownership and
prohibitions on the repatriation of assets, and may have less
protection of property rights than more developed countries. The
economies of countries with emerging markets may be based on only a
few industries, may be highly vulnerable to changes in local or global
trade conditions, and may suffer from extreme and volatile debt
burdens or inflation rates. Local securities markets may trade a small
number of securities and may be unable to respond effectively to
increases in trading volume, potentially making prompt liquidation of
holdings difficult or impossible at times.

FOREIGN CURRENCY TRANSACTIONS. Spartan(registered trademark) Market
Index Fund, Spartan Extended Market Index Fund and Spartan
International Index Fund (the Stock Index Funds) may conduct foreign
currency transactions on a spot (i.e., cash) or forward basis (i.e.,
by entering into forward contracts to purchase or sell foreign
currencies). Although foreign exchange dealers generally do not charge
a fee for such conversions, they do realize a profit based on the
difference between the prices at which they are buying and selling
various currencies. Thus, a dealer may offer to sell a foreign
currency at one rate, while offering a lesser rate of exchange should
the counterparty desire to resell that currency to the dealer. Forward
contracts are customized transactions that require a specific amount
of a currency to be delivered at a specific exchange rate on a
specific date or range of dates in the future. Forward contracts are
generally traded in an interbank market directly between currency
traders (usually large commercial banks) and their customers. The
parties to a forward contract may agree to offset or terminate the
contract before its maturity, or may hold the contract to maturity and
complete the contemplated currency exchange.

The following discussion summarizes the principal currency management
strategies involving forward contracts that could be used by a fund. A
fund may also use swap agreements, indexed securities, and options and
futures contracts relating to foreign currencies for the same
purposes.

A "settlement hedge" or "transaction hedge" is designed to protect a
fund against an adverse change in foreign currency values between the
date a security is purchased or sold and the date on which payment is
made or received. Entering into a forward contract for the purchase or
sale of the amount of foreign currency involved in an underlying
security transaction for a fixed amount of U.S. dollars "locks in" the
U.S. dollar price of the security. Forward contracts to purchase or
sell a foreign currency may also be used by a fund in anticipation of
future purchases or sales of securities denominated in foreign
currency, even if the specific investments have not yet been selected
by BT.

A fund may also use forward contracts to hedge against a decline in
the value of existing investments denominated in foreign currency. For
example, if a fund owned securities denominated in pounds sterling, it
could enter into a forward contract to sell pounds sterling in return
for U.S. dollars to hedge against possible declines in the pound's
value. Such a hedge, sometimes referred to as a "position hedge,"
would tend to offset both positive and negative currency fluctuations,
but would not offset changes in security values caused by other
factors. A fund could also hedge the position by selling another
currency expected to perform similarly to the pound sterling. This
type of hedge, sometimes referred to as a "proxy hedge," could offer
advantages in terms of cost, yield, or efficiency, but generally would
not hedge currency exposure as effectively as a direct hedge into U.S.
dollars. Proxy hedges may result in losses if the currency used to
hedge does not perform similarly to the currency in which the hedged
securities are denominated.

A fund may enter into forward contracts to shift its investment
exposure from one currency into another. This may include shifting
exposure from U.S. dollars to a foreign currency, or from one foreign
currency to another foreign currency. This type of strategy, sometimes
known as a "cross-hedge," will tend to reduce or eliminate exposure to
the currency that is sold, and increase exposure to the currency that
is purchased, much as if a fund had sold a security denominated in one
currency and purchased an equivalent security denominated in another.
Cross-hedges protect against losses resulting from a decline in the
hedged currency, but will cause a fund to assume the risk of
fluctuations in the value of the currency it purchases.

Successful use of currency management strategies will depend on BT's
skill in analyzing currency values. Currency management strategies may
substantially change a fund's investment exposure to changes in
currency exchange rates and could result in losses to a fund if
currencies do not perform as BT anticipates. For example, if a
currency's value rose at a time when BT had hedged a fund by selling
that currency in exchange for dollars, a fund would not participate in
the currency's appreciation. If BT hedges currency exposure through
proxy hedges, a fund could realize currency losses from both the hedge
and the security position if the two currencies do not move in tandem.
Similarly, if BT increases a fund's exposure to a foreign currency and
that currency's value declines, a fund will realize a loss. There is
no assurance that BT's use of currency management strategies will be
advantageous to a fund or that it will hedge at appropriate times.

FOREIGN REPURCHASE AGREEMENTS. Foreign repurchase agreements involve
an agreement to purchase a foreign security and to sell that security
back to the original seller at an agreed-upon price in either U.S.
dollars or foreign currency. Unlike typical U.S. repurchase
agreements, foreign repurchase agreements may not be fully
collateralized at all times. The value of a security purchased by a
fund may be more or less than the price at which the counterparty has
agreed to repurchase the security. In the event of default by the
counterparty, the fund may suffer a loss if the value of the security
purchased is less than the agreed-upon repurchase price, or if the
fund is unable to successfully assert a claim to the collateral under
foreign laws. As a result, foreign repurchase agreements may involve
higher credit risks than repurchase agreements in U.S. markets, as
well as risks associated with currency fluctuations. In addition, as
with other emerging market investments, repurchase agreements with
counterparties located in emerging markets or relating to emerging
markets may involve issuers or counterparties with lower credit
ratings than typical U.S. repurchase agreements.

FUNDS' RIGHTS AS SHAREHOLDERS. The Stock Index Funds do not intend to
direct or administer the day-to-day operations of any company. A fund,
however, may exercise its rights as a shareholder and may communicate
its views on important matters of policy to management, the Board of
Directors, and shareholders of a company when BT determines that such
matters could have a significant effect on the value of the fund's
investment in the company. The activities in which a fund may engage,
either individually or in conjunction with others, may include, among
others, supporting or opposing proposed changes in a company's
corporate structure or business activities; seeking changes in a
company's directors or management; seeking changes in a company's
direction or policies; seeking the sale or reorganization of the
company or a portion of its assets; or supporting or opposing
third-party takeover efforts. This area of corporate activity is
increasingly prone to litigation and it is possible that a fund could
be involved in lawsuits related to such activities. BT will monitor
such activities with a view to mitigating, to the extent possible, the
risk of litigation against a fund and the risk of actual liability if
a fund is involved in litigation. No guarantee can be made, however,
that litigation against a fund will not be undertaken or liabilities
incurred.

FUTURES AND OPTIONS. The following paragraphs pertain to futures and
options: Combined Positions, Correlation of Price Changes, Futures
Contracts, Futures Margin Payments, Limitations on Futures and Options
Transactions, Liquidity of Options and Futures Contracts, Options and
Futures Relating to Foreign Currencies, OTC Options, Purchasing Put
and Call Options, and Writing Put and Call Options.

COMBINED POSITIONS involve purchasing and writing options in
combination with each other, or in combination with futures or forward
contracts, to adjust the risk and return characteristics of the
overall position. For example, purchasing a put option and writing a
call option on the same underlying instrument would construct a
combined position whose risk and return characteristics are similar to
selling a futures contract. Another possible combined position would
involve writing a call option at one strike price and buying a call
option at a lower price, to reduce the risk of the written call option
in the event of a substantial price increase. Because combined options
positions involve multiple trades, they result in higher transaction
costs and may be more difficult to open and close out.

CORRELATION OF PRICE CHANGES. Because there are a limited number of
types of exchange-traded options and futures contracts, it is likely
that the standardized contracts available will not match a fund's
current or anticipated investments exactly. A fund may invest in
options and futures contracts based on securities with different
issuers, maturities, or other characteristics from the securities in
which the fund typically invests, which involves a risk that the
options or futures position will not track the performance of the
fund's other investments.

Options and futures prices can also diverge from the prices of their
underlying instruments, even if the underlying instruments match a
fund's investments well. Options and futures prices are affected by
such factors as current and anticipated short-term interest rates,
changes in volatility of the underlying instrument, and the time
remaining until expiration of the contract, which may not affect
security prices the same way. Imperfect correlation may also result
from differing levels of demand in the options and futures markets and
the securities markets, from structural differences in how options and
futures and securities are traded, or from imposition of daily price
fluctuation limits or trading halts. A fund may purchase or sell
options and futures contracts with a greater or lesser value than the
securities it wishes to hedge or intends to purchase in order to
attempt to compensate for differences in volatility between the
contract and the securities, although this may not be successful in
all cases. If price changes in a fund's options or futures positions
are poorly correlated with its other investments, the positions may
fail to produce anticipated gains or result in losses that are not
offset by gains in other investments.

FUTURES CONTRACTS. In purchasing a futures contract, the buyer agrees
to purchase a specified underlying instrument at a specified future
date. In selling a futures contract, the seller agrees to sell a
specified underlying instrument at a specified future date. The price
at which the purchase and sale will take place is fixed when the buyer
and seller enter into the contract. Some currently available futures
contracts are based on specific securities, such as U.S. Treasury
bonds or notes, and some are based on indices of securities prices,
such as the S&P 500(registered trademark). Futures can be held until
their delivery dates, or can be closed out before then if a liquid
secondary market is available.

Spartan Extended Market Index Fund and Spartan International Index
Fund may invest in futures on stock indexes other than the indexes
they seek to track.

For example, Spartan Extended Market Index Fund may invest in futures
on such indexes as the S&P 500, the Russell 2000 Index, or the S&P
MidCap Index.

Futures may be based on foreign indexes such as the CAC 40 (France),
DAX 30 (Germany), EuroTop 100 (Europe), IBEX (Spain), FTSE 100 (United
Kingdom), All Ordinary (Australia), Hang Seng (Hong Kong), and Nikkei
225, Nikkei 300 and TOPIX (Japan).

FUTURES MARGIN PAYMENTS. The purchaser or seller of a futures contract
is not required to deliver or pay for the underlying instrument unless
the contract is held until the delivery date. However, both the
purchaser and seller are required to deposit "initial margin" with a
futures broker, known as a futures commission merchant (FCM), when the
contract is entered into. Initial margin deposits are typically equal
to a percentage of the contract's value. If the value of either
party's position declines, that party will be required to make
additional "variation margin" payments to settle the change in value
on a daily basis. The party that has a gain may be entitled to receive
all or a portion of this amount. Initial and variation margin payments
do not constitute purchasing securities on margin for purposes of a
fund's investment limitations. In the event of the bankruptcy of an
FCM that holds margin on behalf of a fund, the fund may be entitled to
return of margin owed to it only in proportion to the amount received
by the FCM's other customers, potentially resulting in losses to the
fund.

Although futures exchanges generally operate similarly in the United
States and abroad, foreign futures exchanges may follow trading,
settlement and margin procedures that are different from those for
U.S. exchanges. Futures contracts traded outside the United States may
involve greater risk of loss than U.S.-traded contracts, including
potentially greater risk of losses due to insolvency of a futures
broker, exchange member or other party that may owe initial or
variation margin to a fund. Because initial and variation margin
payments may be measured in foreign currency, a futures contract
traded outside the United States may also involve the risk of foreign
currency fluctuation.

LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. Each fund has filed a
notice of eligibility for exclusion from the definition of the term
"commodity pool operator" with the Commodity Futures Trading
Commission (CFTC) and the National Futures Association, which regulate
trading in the futures markets. The funds intend to comply with Rule
4.5 under the Commodity Exchange Act, which limits the extent to which
the funds can commit assets to initial margin deposits and option
premiums.

In addition, Fidelity U.S. Bond Index Fund will not: (a) sell futures
contracts, purchase put options, or write call options if, as a
result, more than 25% of the fund's total assets would be hedged with
futures and options under normal conditions; (b) purchase futures
contracts or write put options if, as a result, the fund's total
obligations upon settlement or exercise of purchased futures contracts
and written put options would exceed 25% of its total assets; or (c)
purchase call options if, as a result, the current value of option
premiums for call options purchased by the fund would exceed 5% of the
fund's total assets. These limitations do not apply to options
attached to or acquired or traded together with their underlying
securities, and do not apply to securities that incorporate features
similar to options.

BT also intends to follow certain other limitations on Spartan Market
Index Fund's, Spartan Extended Market Index Fund's and Spartan
International Index Fund's futures and option activities. Each fund
will not purchase any option if, as a result, more than 5% of its
total assets would be invested in option premiums. Under normal
conditions, each fund will not enter into any futures contract or
option if, as a result, the sum of (i) the current value of assets
hedged in the case of strategies involving the sale of securities, and
(ii) the current value of the indices or other instruments underlying
the fund's other futures or options positions, would exceed 35% of the
fund's total assets. These limitations do not apply to options
attached to, or acquired or traded together with their underlying
securities, and do not apply to securities that incorporate features
similar to options.

The above limitations on the funds' investments in futures contracts
and options, and the funds' policies regarding futures contracts and
options discussed elsewhere in this SAI, may be changed as regulatory
agencies permit.

LIQUIDITY OF OPTIONS AND FUTURES CONTRACTS. There is no assurance a
liquid secondary market will exist for any particular options or
futures contract at any particular time. Options may have relatively
low trading volume and liquidity if their strike prices are not close
to the underlying instrument's current price. In addition, exchanges
may establish daily price fluctuation limits for options and futures
contracts, and may halt trading if a contract's price moves upward or
downward more than the limit in a given day. On volatile trading days
when the price fluctuation limit is reached or a trading halt is
imposed, it may be impossible to enter into new positions or close out
existing positions. If the secondary market for a contract is not
liquid because of price fluctuation limits or otherwise, it could
prevent prompt liquidation of unfavorable positions, and potentially
could require a fund to continue to hold a position until delivery or
expiration regardless of changes in its value. As a result, a fund's
access to other assets held to cover its options or futures positions
could also be impaired.

OPTIONS AND FUTURES RELATING TO FOREIGN CURRENCIES. Currency futures
contracts are similar to forward currency exchange contracts, except
that they are traded on exchanges (and have margin requirements) and
are standardized as to contract size and delivery date. Most currency
futures contracts call for payment or delivery in U.S. dollars. The
underlying instrument of a currency option may be a foreign currency,
which generally is purchased or delivered in exchange for U.S.
dollars, or may be a futures contract. The purchaser of a currency
call obtains the right to purchase the underlying currency, and the
purchaser of a currency put obtains the right to sell the underlying
currency.

The uses and risks of currency options and futures are similar to
options and futures relating to securities or indices, as discussed
above. A fund may purchase and sell currency futures and may purchase
and write currency options to increase or decrease its exposure to
different foreign currencies. Currency options may also be purchased
or written in conjunction with each other or with currency futures or
forward contracts. Currency futures and options values can be expected
to correlate with exchange rates, but may not reflect other factors
that affect the value of a fund's investments. A currency hedge, for
example, should protect a Yen-denominated security from a decline in
the Yen, but will not protect a fund against a price decline resulting
from deterioration in the issuer's creditworthiness. Because the value
of a fund's foreign-denominated investments changes in response to
many factors other than exchange rates, it may not be possible to
match the amount of currency options and futures to the value of the
fund's investments exactly over time.

OTC OPTIONS. Unlike exchange-traded options, which are standardized
with respect to the underlying instrument, expiration date, contract
size, and strike price, the terms of over-the-counter (OTC) options
(options not traded on exchanges) generally are established through
negotiation with the other party to the option contract. While this
type of arrangement allows the purchaser or writer greater flexibility
to tailor an option to its needs, OTC options generally involve
greater credit risk than exchange-traded options, which are guaranteed
by the clearing organization of the exchanges where they are traded.

PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, the
purchaser obtains the right (but not the obligation) to sell the
option's underlying instrument at a fixed strike price. In return for
this right, the purchaser pays the current market price for the option
(known as the option premium). Options have various types of
underlying instruments, including specific securities, indices of
securities prices, and futures contracts. The purchaser may terminate
its position in a put option by allowing it to expire or by exercising
the option. If the option is allowed to expire, the purchaser will
lose the entire premium. If the option is exercised, the purchaser
completes the sale of the underlying instrument at the strike price. A
purchaser may also terminate a put option position by closing it out
in the secondary market at its current price, if a liquid secondary
market exists.

The buyer of a typical put option can expect to realize a gain if
security prices fall substantially. However, if the underlying
instrument's price does not fall enough to offset the cost of
purchasing the option, a put buyer can expect to suffer a loss
(limited to the amount of the premium, plus related transaction
costs).

The features of call options are essentially the same as those of put
options, except that the purchaser of a call option obtains the right
to purchase, rather than sell, the underlying instrument at the
option's strike price. A call buyer typically attempts to participate
in potential price increases of the underlying instrument with risk
limited to the cost of the option if security prices fall. At the same
time, the buyer can expect to suffer a loss if security prices do not
rise sufficiently to offset the cost of the option.

WRITING PUT AND CALL OPTIONS. The writer of a put or call option takes
the opposite side of the transaction from the option's purchaser. In
return for receipt of the premium, the writer assumes the obligation
to pay the strike price for the option's underlying instrument if the
other party to the option chooses to exercise it. The writer may seek
to terminate a position in a put option before exercise by closing out
the option in the secondary market at its current price. If the
secondary market is not liquid for a put option, however, the writer
must continue to be prepared to pay the strike price while the option
is outstanding, regardless of price changes. When writing an option on
a futures contract, a fund will be required to make margin payments to
an FCM as described above for futures contracts.

If security prices rise, a put writer would generally expect to
profit, although its gain would be limited to the amount of the
premium it received. If security prices remain the same over time, it
is likely that the writer will also profit, because it should be able
to close out the option at a lower price. If security prices fall, the
put writer would expect to suffer a loss. This loss should be less
than the loss from purchasing the underlying instrument directly,
however, because the premium received for writing the option should
mitigate the effects of the decline.

Writing a call option obligates the writer to sell or deliver the
option's underlying instrument, in return for the strike price, upon
exercise of the option. The characteristics of writing call options
are similar to those of writing put options, except that writing calls
generally is a profitable strategy if prices remain the same or fall.
Through receipt of the option premium, a call writer mitigates the
effects of a price decline. At the same time, because a call writer
must be prepared to deliver the underlying instrument in return for
the strike price, even if its current value is greater, a call writer
gives up some ability to participate in security price increases.

ILLIQUID SECURITIES cannot be sold or disposed of in the ordinary
course of business at approximately the prices at which they are
valued. Difficulty in selling securities may result in a loss or may
be costly to a fund. For the Stock Index Funds, under the supervision
of the Board of Trustees and FMR, BT determines the liquidity of a
fund's investments and, through reports from FMR and/or BT, the Board
monitors investments in illiquid securities. For U.S. Bond Index,
under the supervision of the Board of Trustees, FMR determines the
liquidity of the fund's investments and, through reports from FMR, the
Board monitors investments in illiquid securities. In determining the
liquidity of a fund's investments, FMR or BT, as applicable, may
consider various factors, including (1) the frequency and volume of
trades and quotations, (2) the number of dealers and prospective
purchasers in the marketplace, (3) dealer undertakings to make a
market and (4) the nature of the security and the market in which it
trades (including any demand, put or tender features, the mechanics
and other requirements for transfer, any letters of credit or other
credit enhancement features, any ratings, the number of holders, the
method of soliciting offers, the time required to dispose of the
security, and the ability to assign or offset the rights and
obligations of the security).

INDEXED SECURITIES are instruments whose prices are indexed to the
prices of other securities, securities indices, currencies, or other
financial indicators. Indexed securities typically, but not always,
are debt securities or deposits whose value at maturity or coupon rate
is determined by reference to a specific instrument or statistic.

Mortgage-indexed securities, for example, could be structured to
replicate the performance of mortgage securities and the
characteristics of direct ownership.

The performance of indexed securities depends to a great extent on the
performance of the security, currency, or other instrument to which
they are indexed, and may also be influenced by interest rate changes
in the United States and abroad. Indexed securities may be more
volatile than the underlying instruments. Indexed securities are also
subject to the credit risks associated with the issuer of the
security, and their values may decline substantially if the issuer's
creditworthiness deteriorates. Recent issuers of indexed securities
have included banks, corporations, and certain U.S. Government
agencies.

In addition, for the Stock Index Funds, indexed securities include
commercial paper, certificates of deposit, and other fixed-income
securities whose values at maturity or coupon interest rates are
determined by reference to the returns of the S&P 500, the Wilshire
4500, the Morgan Stanley Capital International Europe, Australasia,
Far East Index (MSCI EAFE) or comparable stock indices. Indexed
securities can be affected by stock prices as well as changes in
interest rates and the creditworthiness of their issuers and may not
track the indexes as accurately as direct investments in the indexes.

INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive
order issued by the SEC, a fund may lend money to, and borrow money
from, other funds advised by FMR or its affiliates. A fund will lend
through the program only when the returns are higher than those
available from an investment in repurchase agreements, and will borrow
through the program only when the costs are equal to or lower than the
cost of bank loans. Interfund loans and borrowings normally extend
overnight, but can have a maximum duration of seven days. Loans may be
called on one day's notice. A fund may have to borrow from a bank at a
higher interest rate if an interfund loan is called or not renewed.
Any delay in repayment to a lending fund could result in a lost
investment opportunity or additional borrowing costs.

LOANS AND OTHER DIRECT DEBT INSTRUMENTS. Direct debt instruments are
interests in amounts owed by a corporate, governmental, or other
borrower to lenders or lending syndicates (loans and loan
participations), to suppliers of goods or services (trade claims or
other receivables), or to other parties. Direct debt instruments
involve a risk of loss in case of default or insolvency of the
borrower and may offer less legal protection to the purchaser in the
event of fraud or misrepresentation, or there may be a requirement
that a fund supply additional cash to a borrower on demand.

Purchasers of loans and other forms of direct indebtedness depend
primarily upon the creditworthiness of the borrower for payment of
interest and repayment of principal. If scheduled interest or
principal payments are not made, the value of the instrument may be
adversely affected. Loans that are fully secured provide more
protections than an unsecured loan in the event of failure to make
scheduled interest or principal payments. However, there is no
assurance that the liquidation of collateral from a secured loan would
satisfy the borrower's obligation, or that the collateral could be
liquidated. Indebtedness of borrowers whose creditworthiness is poor
involves substantially greater risks and may be highly speculative.
Borrowers that are in bankruptcy or restructuring may never pay off
their indebtedness, or may pay only a small fraction of the amount
owed. Direct indebtedness of developing countries also involves a risk
that the governmental entities responsible for the repayment of the
debt may be unable, or unwilling, to pay interest and repay principal
when due.

Investments in loans through direct assignment of a financial
institution's interests with respect to a loan may involve additional
risks. For example, if a loan is foreclosed, the purchaser could
become part owner of any collateral, and would bear the costs and
liabilities associated with owning and disposing of the collateral. In
addition, it is conceivable that under emerging legal theories of
lender liability, a purchaser could be held liable as a co-lender.
Direct debt instruments may also involve a risk of insolvency of the
lending bank or other intermediary.

A loan is often administered by a bank or other financial institution
that acts as agent for all holders. The agent administers the terms of
the loan, as specified in the loan agreement. Unless, under the terms
of the loan or other indebtedness, the purchaser has direct recourse
against the borrower, the purchaser may have to rely on the agent to
apply appropriate credit remedies against a borrower. If assets held
by the agent for the benefit of a purchaser were determined to be
subject to the claims of the agent's general creditors, the purchaser
might incur certain costs and delays in realizing payment on the loan
or loan participation and could suffer a loss of principal or
interest.

Direct indebtedness may include letters of credit, revolving credit
facilities, or other standby financing commitments that obligate
purchasers to make additional cash payments on demand. These
commitments may have the effect of requiring a purchaser to increase
its investment in a borrower at a time when it would not otherwise
have done so, even if the borrower's condition makes it unlikely that
the amount will ever be repaid.

Each fund limits the amount of total assets that it will invest in any
one issuer or in issuers within the same industry. For purposes of
these limitations, a fund generally will treat the borrower as the
"issuer" of indebtedness held by the fund. In the case of loan
participations where a bank or other lending institution serves as
financial intermediary between a fund and the borrower, if the
participation does not shift to the fund the direct debtor-creditor
relationship with the borrower, SEC interpretations require a fund, in
appropriate circumstances, to treat both the lending bank or other
lending institution and the borrower as "issuers" for these purposes.
Treating a financial intermediary as an issuer of indebtedness may
restrict a fund's ability to invest in indebtedness related to a
single financial intermediary, or a group of intermediaries engaged in
the same industry, even if the underlying borrowers represent many
different companies and industries.

LOWER-QUALITY DEBT SECURITIES. Lower-quality debt securities have poor
protection with respect to the payment of interest and repayment of
principal, or may be in default. These securities are often considered
to be speculative and involve greater risk of loss or price changes
due to changes in the issuer's capacity to pay. The market prices of
lower-quality debt securities may fluctuate more than those of
higher-quality debt securities and may decline significantly in
periods of general economic difficulty, which may follow periods of
rising interest rates.

The market for lower-quality debt securities may be thinner and less
active than that for higher-quality debt securities, which can
adversely affect the prices at which the former are sold. Adverse
publicity and changing investor perceptions may affect the liquidity
of lower-quality debt securities and the ability of outside pricing
services to value lower-quality debt securities.

Because the risk of default is higher for lower-quality debt
securities, FMR's research and credit analysis are an especially
important part of managing securities of this type. FMR will attempt
to identify those issuers of high-yielding securities whose financial
condition is adequate to meet future obligations, has improved, or is
expected to improve in the future. FMR's analysis focuses on relative
values based on such factors as interest or dividend coverage, asset
coverage, earnings prospects, and the experience and managerial
strength of the issuer.

A fund may choose, at its expense or in conjunction with others, to
pursue litigation or otherwise to exercise its rights as a security
holder to seek to protect the interests of security holders if it
determines this to be in the best interest of the fund's shareholders.

MORTGAGE SECURITIES are issued by government and non-government
entities such as banks, mortgage lenders, or other institutions. A
mortgage security is an obligation of the issuer backed by a mortgage
or pool of mortgages or a direct interest in an underlying pool of
mortgages. Some mortgage securities, such as collateralized mortgage
obligations (or "CMOs"), make payments of both principal and interest
at a range of specified intervals; others make semiannual interest
payments at a predetermined rate and repay principal at maturity (like
a typical bond). Mortgage securities are based on different types of
mortgages, including those on commercial real estate or residential
properties. Stripped mortgage securities are created when the interest
and principal components of a mortgage security are separated and sold
as individual securities. In the case of a stripped mortgage security,
the holder of the "principal-only" security (PO) receives the
principal payments made by the underlying mortgage, while the holder
of the "interest-only" security (IO) receives interest payments from
the same underlying mortgage.

Fannie Maes and Freddie Macs are pass-through securities issued by
Fannie Mae and Freddie Mac, respectively. Fannie Mae and Freddie Mac,
which guarantee payment of interest and repayment of principal on
Fannie Maes and Freddie Macs, respectively, are federally chartered
corporations supervised by the U.S. Government that act as
governmental instrumentalities under authority granted by Congress.
Fannie Mae is authorized to borrow from the U.S. Treasury to meet its
obligations. Fannie Maes and Freddie Macs are not backed by the full
faith and credit of the U.S. Government.

The value of mortgage securities may change due to shifts in the
market's perception of issuers and changes in interest rates. In
addition, regulatory or tax changes may adversely affect the mortgage
securities market as a whole. Non-government mortgage securities may
offer higher yields than those issued by government entities, but also
may be subject to greater price changes than government issues.
Mortgage securities are subject to prepayment risk, which is the risk
that early principal payments made on the underlying mortgages,
usually in response to a reduction in interest rates, will result in
the return of principal to the investor, causing it to be invested
subsequently at a lower current interest rate. Alternatively, in a
rising interest rate environment, mortgage security values may be
adversely affected when prepayments on underlying mortgages do not
occur as anticipated, resulting in the extension of the security's
effective maturity and the related increase in interest rate
sensitivity of a longer-term instrument. The prices of stripped
mortgage securities tend to be more volatile in response to changes in
interest rates than those of non-stripped mortgage securities.

In order to earn additional income for a fund, FMR may use a trading
strategy that involves selling mortgage securities and simultaneously
agreeing to purchase similar securities on a later date at a set
price. This trading strategy may result in an increased portfolio
turnover rate which increases costs and may increase taxable gains.

PREFERRED STOCK is a class of equity or ownership in an issuer that
pays dividends at a specified rate and that has precedence over common
stock in the payment of dividends. In the event an issuer is
liquidated or declares bankruptcy, the claims of owners of bonds take
precedence over the claims of those who own preferred and common
stock.

REAL ESTATE INVESTMENT TRUSTS. Equity real estate investment trusts
own real estate properties, while mortgage real estate investment
trusts make construction, development, and long-term mortgage loans.
Their value may be affected by changes in the value of the underlying
property of the trusts, the creditworthiness of the issuer, property
taxes, interest rates, and tax and regulatory requirements, such as
those relating to the environment. Both types of trusts are dependent
upon management skill, are not diversified, and are subject to heavy
cash flow dependency, defaults by borrowers, self-liquidation, and the
possibility of failing to qualify for tax-free status of income under
the Internal Revenue Code and failing to maintain exemption from the
1940 Act.

REPURCHASE AGREEMENTS involve an agreement to purchase a security and
to sell that security back to the original seller at an agreed-upon
price. The resale price reflects the purchase price plus an
agreed-upon incremental amount which is unrelated to the coupon rate
or maturity of the purchased security. As protection against the risk
that the original seller will not fulfill its obligation, the
securities are held in a separate account at a bank, marked-to-market
daily, and maintained at a value at least equal to the sale price plus
the accrued incremental amount. The value of the security purchased
may be more or less than the price at which the counterparty has
agreed to purchase the security. In addition, delays or losses could
result if the other party to the agreement defaults or becomes
insolvent. The funds will engage in repurchase agreement transactions
with parties whose creditworthiness has been reviewed and found
satisfactory by FMR (U.S. Bond Index), by BT, or, under certain
circumstances, by FMR or an FMR-affiliate (Stock Index Funds).

REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a
fund sells a security to another party, such as a bank or
broker-dealer, in return for cash and agrees to repurchase that
security at an agreed-upon price and time. The funds will enter into
reverse repurchase agreements with parties whose creditworthiness has
been reviewed and found satisfactory by FMR (U.S. Bond Index), by BT,
or, under certain circumstances, by FMR or an FMR-affiliate (Stock
Index Funds). Such transactions may increase fluctuations in the
market value of fund assets and a fund's yield and may be viewed as a
form of leverage.

SECURITIES OF OTHER INVESTMENT COMPANIES, including shares of
closed-end investment companies, unit investment trusts, and open-end
investment companies, represent interests in professionally managed
portfolios that may invest in any type of instrument. Investing in
other investment companies involves substantially the same risks as
investing directly in the underlying instruments, but may involve
additional expenses at the investment company-level, such as portfolio
management fees and operating expenses. Certain types of investment
companies, such as closed-end investment companies, issue a fixed
number of shares that trade on a stock exchange or over-the-counter at
a premium or a discount to their net asset value. Others are
continuously offered at net asset value, but may also be traded in the
secondary market.

The extent to which a fund can invest in securities of other
investment companies is limited by federal securities laws.

The Stock Index Funds may invest in investment companies that seek to
track the performance of indexes other than the indexes that the funds
seek to track.

SECURITIES LENDING. A fund may lend securities to parties such as
broker-dealers or other institutions, including FBSI. FBSI is a member
of the New York Stock Exchange and a subsidiary of FMR Corp. The Stock
Index Funds will not lend securities to BT or its affiliates. BT
receives a portion of securities lending income earned by each Stock
Index Fund.

Securities lending allows a fund to retain ownership of the securities
loaned and, at the same time, to earn additional income. Because there
may be delays in the recovery of loaned securities, or even a loss of
rights in collateral supplied should the borrower fail financially,
loans will be made only to parties deemed by FMR (U.S. Bond Index), by
BT, or, under certain circumstances, by FMR or an FMR-affiliate (Stock
Index Funds), to be of good standing. Furthermore, they will only be
made if, in FMR's (U.S. Bond Index) or BT's (Stock Index Funds)
judgment, as applicable, the consideration to be earned from such
loans would justify the risk.

FMR and BT understand that it is the current view of the SEC Staff
that a fund may engage in loan transactions only under the following
conditions: (1) the fund must receive 100% collateral in the form of
cash or cash equivalents (e.g., U.S. Treasury bills or notes) from the
borrower; (2) the borrower must increase the collateral whenever the
market value of the securities loaned (determined on a daily basis)
rises above the value of the collateral; (3) after giving notice, the
fund must be able to terminate the loan at any time; (4) the fund must
receive reasonable interest on the loan or a flat fee from the
borrower, as well as amounts equivalent to any dividends, interest, or
other distributions on the securities loaned and to any increase in
market value; (5) the fund may pay only reasonable custodian fees in
connection with the loan; and (6) the Board of Trustees must be able
to vote proxies on the securities loaned, either by terminating the
loan or by entering into an alternative arrangement with the borrower.

Cash received through loan transactions may be invested in other
eligible securities. Investing this cash subjects that investment, as
well as the security loaned, to market forces (i.e., capital
appreciation or depreciation). If a fund cannot recover the loaned
securities on termination, a fund may sell the collateral and purchase
a replacement investment in the market.

SHORT SALES "AGAINST THE BOX" are short sales of securities that a
fund owns or has the right to obtain (equivalent in kind or amount to
the securities sold short). If a fund enters into a short sale against
the box, it will be required to set aside securities equivalent in
kind and amount to the securities sold short (or securities
convertible or exchangeable into such securities) and will be required
to hold such securities while the short sale is outstanding. The fund
will incur transaction costs, including interest expenses, in
connection with opening, maintaining, and closing short sales against
the box.

SOURCES OF CREDIT OR LIQUIDITY SUPPORT. Issuers may employ various
forms of credit and liquidity enhancements, including letters of
credit, guarantees, puts, and demand features, and insurance provided
by domestic or foreign entities such as banks and other financial
institutions. FMR may rely on its evaluation of the credit of the
credit or liquidity enhancement provider in determining whether to
purchase a security supported by such enhancement. In evaluating the
credit of a foreign bank or other foreign entities, FMR will consider
whether adequate public information about the entity is available and
whether the entity may be subject to unfavorable political or economic
developments, currency controls, or other government restrictions that
might affect its ability to honor its commitment. Changes in the
credit quality of the entity providing the enhancement could affect
the value of the security or a fund's share price.

STRIPPED SECURITIES are the separate income or principal components of
a debt security. The risks associated with stripped securities are
similar to those of other debt securities, although stripped
securities may be more volatile, and the value of certain types of
stripped securities may move in the same direction as interest rates.
U.S. Treasury securities that have been stripped by a Federal Reserve
Bank are obligations issued by the U.S. Treasury.

Privately stripped government securities are created when a dealer
deposits a U.S. Treasury security or other U.S. Government security
with a custodian for safekeeping. The custodian issues separate
receipts for the coupon payments and the principal payment, which the
dealer then sells.

SWAP AGREEMENTS can be individually negotiated and structured to
include exposure to a variety of different types of investments or
market factors. Depending on their structure, swap agreements may
increase or decrease a fund's exposure to long- or short-term interest
rates (in the United States or abroad), foreign currency values,
mortgage securities, corporate borrowing rates, or other factors such
as security prices or inflation rates. Swap agreements can take many
different forms and are known by a variety of names.

In a typical cap or floor agreement, one party agrees to make payments
only under specified circumstances, usually in return for payment of a
fee by the other party. For example, the buyer of an interest rate cap
obtains the right to receive payments to the extent that a specified
interest rate exceeds an agreed-upon level, while the seller of an
interest rate floor is obligated to make payments to the extent that a
specified interest rate falls below an agreed-upon level. An interest
rate collar combines elements of buying a cap and selling a floor.

Swap agreements will tend to shift a fund's investment exposure from
one type of investment to another. For example, if the fund agreed to
exchange payments in dollars for payments in foreign currency, the
swap agreement would tend to decrease the fund's exposure to U.S.
interest rates and increase its exposure to foreign currency and
interest rates. Or, if the fund agreed to pay fixed rates in exchange
for floating rates while holding fixed-rate bonds, the swap would tend
to decrease the fund's exposure to long-term interest rates. Caps and
floors have an effect similar to buying or writing options. Depending
on how they are used, swap agreements may increase or decrease the
overall volatility of a fund's investments and its share price and
yield.

Under a typical equity swap agreement, a counterparty such as a bank
or broker-dealer agrees to pay the fund a return equal to the dividend
payments and increase in value, if any, of an index or group of
stocks, and the fund agrees in return to pay a fixed or floating rate
of interest, plus any declines in value of the index. Swap agreements
can also have features providing for maximum or minimum exposure to a
designated index. In order to track the return of its designated index
effectively, a fund would generally have to own other assets returning
approximately the same amount as the interest rate payable by the fund
under the swap agreement.

The most significant factor in the performance of swap agreements is
the change in value of the specific index or currency, or other
factors that determine the amounts of payments due to and from a fund.
If a swap agreement calls for payments by the fund, the fund must be
prepared to make such payments when due. In addition, if the
counterparty's creditworthiness declined, the value of a swap
agreement would be likely to decline, potentially resulting in losses
and impairing the fund's correlation with its applicable index. A fund
may be able to eliminate its exposure under a swap agreement either by
assignment or other disposition, or by entering into an offsetting
swap agreement with the same party or a similarly creditworthy party.

TEMPORARY DEFENSIVE POLICIES.

Each of Spartan Market Index Fund, Spartan Extended Market Index Fund
and Spartan International Index Fund reserves the right to invest
without limitation in preferred stocks and investment-grade debt
instruments for temporary, defensive purposes.

U.S. Bond Index reserves the right to invest without limitation in
investment-grade money market or short-term debt instruments for
temporary, defensive purposes.

VARIABLE AND FLOATING RATE SECURITIES provide for periodic adjustments
in the interest rate paid on the security. Variable rate securities
provide for a specified periodic adjustment in the interest rate,
while floating rate securities have interest rates that change
whenever there is a change in a designated benchmark rate. Some
variable or floating rate securities are structured with put features
that permit holders to demand payment of the unpaid principal balance
plus accrued interest from the issuers or certain financial
intermediaries.

WARRANTS. Warrants are instruments which entitle the holder to buy an
equity security at a specific price for a specific period of time.
Changes in the value of a warrant do not necessarily correspond to
changes in the value of its underlying security. The price of a
warrant may be more volatile than the price of its underlying
security, and a warrant may offer greater potential for capital
appreciation as well as capital loss.

Warrants do not entitle a holder to dividends or voting rights with
respect to the underlying security and do not represent any rights in
the assets of the issuing company. A warrant ceases to have value if
it is not exercised prior to its expiration date. These factors can
make warrants more speculative than other types of investments.

WHEN-ISSUED AND FORWARD PURCHASE OR SALE TRANSACTIONS involve a
commitment to purchase or sell specific securities at a predetermined
price or yield in which payment and delivery take place after the
customary settlement period for that type of security. Typically, no
interest accrues to the purchaser until the security is delivered.

When purchasing securities pursuant to one of these transactions, the
purchaser assumes the rights and risks of ownership, including the
risks of price and yield fluctuations and the risk that the security
will not be issued as anticipated. Because payment for the securities
is not required until the delivery date, these risks are in addition
to the risks associated with a fund's investments. If a fund remains
substantially fully invested at a time when a purchase is outstanding,
the purchases may result in a form of leverage. When a fund has sold a
security pursuant to one of these transactions, the fund does not
participate in further gains or losses with respect to the security.
If the other party to a delayed-delivery transaction fails to deliver
or pay for the securities, a fund could miss a favorable price or
yield opportunity or suffer a loss.

A fund may renegotiate a when-issued or forward transaction and may
sell the underlying securities before delivery, which may result in
capital gains or losses for the fund.

ZERO COUPON BONDS do not make interest payments; instead, they are
sold at a discount from their face value and are redeemed at face
value when they mature. Because zero coupon bonds do not pay current
income, their prices can be more volatile than other types of
fixed-income securities when interest rates change. In calculating a
fund's dividend, a portion of the difference between a zero coupon
bond's purchase price and its face value is considered income.

SPECIAL CONSIDERATIONS REGARDING EUROPE

Europe can be divided into two distinct categories of market
development: the developed economies of Western Europe and the
transition economies of Eastern Europe.

Any discussion of European national economies and securities markets
must be made with an eye to the impact that the European Union (EU)
and European Economic and Monetary Union (EMU) will have upon the
future of these countries as well as the rest of the world. The scope
and magnitude of these economic and political initiatives dwarfs
anything attempted to date. If successful, the EU will change or erase
many political, economic, cultural and market distinctions that define
and differentiate each of the Continent's countries today. The third
and final stage of the EMU was implemented on January 1, 1999.

The EU consists of 15 countries of western Europe: Austria, Belgium,
Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,
the Netherlands, Portugal, Spain, Sweden and the United Kingdom. The
six founding countries first formed an economic community in the 1950s
to bring down trade barriers such as taxes and quotas, to eliminate
technical restrictions such as special standards and regulations for
foreigners, and to coordinate various industrial policies, such as
those pertaining to agriculture. Since that time the group has
admitted new members and, in time, may expand its membership to other
nations such as those of Eastern Europe. The EU has as its goal, the
creation of a single, unified market that would be, at over 370
million people, the largest in the developed world and through which
goods, people and capital could move freely.

A second component of the EU is the establishment of a single currency
- - the Euro, to replace each member country's domestic currencies. In
preparation for the creation of the Euro, the Exchange Rate Mechanism
(ERM) was established to keep the various national currencies at a
pre-specified value relative to each other. The year 1997 is
significant for membership in the EU as it is the initial reference
year for evaluating debt levels and deficits within the criteria set
forth by the Maastricht treaty. Specifically, the Maastricht criteria
include, among other indicators, an inflation rate below 3.3%, a
public debt below 60% of GDP, and a deficit of 3% or less of GDP.
Failure to meet the Maastricht levels would disqualify any country
from membership.

On May 3, 1998 the European Council of Ministers formally announced
the "first wave" of EMU participants. They are: Austria, Belgium,
Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands,
Portugal and Spain. On January 1, 1999, the Euro became a currency,
while the bank notes used by EMU's eleven members remain legal tender.
After a three year transition period, the Euro will begin circulating
on January 1, 2002. Six months later, today's currencies will cease to
exist.

Many foreign and domestic businesses are establishing or increasing
their presence in Europe in anticipation of the new unified single
market. Clear, confident visions of a diverse, multi-industrial,
unified market under a single currency have been the impetus for much
of the recent corporate restructuring initiatives as well as for the
increased mergers and acquisitions activity in the region. A
successful EMU could prove to be an engine for sustained growth
throughout Europe.

While the securities markets view the introduction of the Euro as
inevitable, the success of the union is not wholly assured. Europe
must grapple with a number of challenges, any one of which could
threaten the survival of this monumental undertaking. For example,
eleven disparate economies must adjust to a unified monetary system,
the absence of exchange rate flexibility and the loss of economic
sovereignty. The Continent's economies are diverse, its governments
decentralized and its cultures differ widely. Unemployment is
historically high and could pose a political risk that one or more
countries might exit the union placing the currency and banking system
in jeopardy.

For those countries in Western and Eastern Europe that were not
included in the first round of the EU implementation, the prospects
for eventual membership serves as a strong political impetus for many
governments to employ tight fiscal and monetary policies. Particularly
for the Eastern European countries, aspirations to join the EU are
likely to push governments to act decisively. At the same time, there
could become an increasingly widening gap between rich and poor both
within the aspiring countries and also those countries who are close
to meeting membership criteria and those who are not. Realigning
traditional alliances could result in altering trading relationships
and potentially provoking divisive socio-economic splits.

The economies of Eastern Europe are embarking on the transition from
communism at different paces with appropriately different
characteristics. The transition countries also display sharp contrasts
in performance. Those that are most advanced in the transformation
process are now reaping the rewards of comprehensive reform and
stabilization policies pursued with determination over recent years.
These include Poland, the Baltic countries, Croatia, the Czech
Republic, Hungary, the Slovak Republic and Slovenia. Conversely, those
that are less advanced in the transition are struggling with a number
of policy challenges to strengthen their economies. Several countries
have made good progress, and in Armenia, Azerbaijan, Georgia,
Kazakhstan, and the Kyrgyz Republic, inflation has fallen considerably
in recent years. Nevertheless, the East European markets are
particularly vulnerable to weakness in the world's other emerging
countries and are particularly sensitive to events in Russia. For
example, in mid-1998 when economic and political turmoil forced the
Russian government to devalue its currency and restructure its debt
payments, the other markets in Eastern Europe suffered significant
destabilization of which the extent and duration is still unknown.

FRANCE. France is a republic of over 58 million people in the historic
if not the geographic center of Western Europe. The Fifth French
Republic, established in the early postwar period under Charles de
Gaulle, provides for a strong Presidency which can appoint its own
cabinet but must win approval of a parliamentary majority. The
government was founded upon the French cultural values of liberty,
brotherhood and egalitarianism. In France, this latter value often
translates into a government burden of providing job security. The
result is a large, vast bureaucracy in the public sector and strict
employment and labor laws in the private sector. In addition, a
significant portion of government economic policy revolves around
regulating and protecting domestic industries, particularly farming
and manufacturing. Finally, the French government frequently owns high
majority or minority interests in large companies, particularly
utility, transport and communications concerns. While privatization
has been a popular movement in many other European countries, it has
encountered a stalled stop-and-go cycle in France.

The French economy is the world's fourth-largest Western
industrialized economy, with a GDP of $1538 billion in 1996. The
nation has substantial agricultural resources, a diversified modern
industrial system, and a highly skilled labor force. France's economy
boasts a sophisticated industrial manufacturing base, which includes
not only high technology (information technology and
telecommunications, vehicles, aircraft, computer equipment, etc.) but
also a number of very large companies producing consumer goods. The
country's industrial structure is unusual for an industrialized
economy because the state still controls a large proportion of the
heavy strategic goods industries as well as institutions such as banks
and communications companies. The agricultural sector continues to be
important; however, most farms are small by European standards and
require massive government support. Exports are an economic strong
point and the nation has enjoyed trade surpluses in recent years.
Leading exports include chemicals, electronics and automotive and
aircraft machinery, while imports are dominated by petroleum,
industrial machinery and electronics. Their main trading partners are
the United States, Japan, and other EU countries.

The country is one of the largest consumers of nuclear energy,
obtaining nearly 75% of its total electricity needs from reactors.
While it has some small deposits of oil and gas, it remains heavily
dependent on imports for most of its needs.

In recent years, the country's economic growth has been hindered by a
series of general strikes. The government's efforts to reduce spending
to meet the Maastricht criteria have prompted strikes and unrest from
France's powerful trade unions. In addition, striking workers have
pushed their demands for a lower retirement age and a reduction in the
work week. With an unemployment rate above 12%, the country's labor
markets are not functioning efficiently. France's pay-as-you-go
pension program is an additional deterrent to economic growth as
spending on pensions account for a tenth of GDP. While all parties
agree that the system must be replaced, no agreement has been reached
on an alternative.

France went to the polls in May 1997 after a surprise decision to hold
early elections by conservative President Jacques Chirac. Chirac's
calculation was to capitalize on popular support before he was forced
to undertake austere fiscal measures to meet the Maastricht criteria.
Voters responded that they were more concerned about the country's
high level of unemployment and Chirac's party lost enough seats in the
parliament that the president must now share power for the remaining
five years in office with a socialist-led government. This change
could set back the previous government's pledges to continue its
privatization initiatives, restrain spending, support the franc, and
endure fiscal austerity. It also calls into question whether the
French people have the will to adhere to the EMU convergence criteria
over the next few years.

The stock market in France has undergone both gradual and dramatic
changes in recent years, keeping pace with global trends toward
deregulation, privatization, and cross border activities, allowing
Paris to maintain its position as the world's fourth-largest financial
center. Until 1996, the Paris Bourse was the country's sole stock
exchange, providing access to all listed French securities. Since
then, foreign interest has been stimulated by the creation of new
markets, such as the Nouveau Marche, for riskier, growth oriented,
small corporations. While the listings of these combined markets are
fairly diverse, financial companies account for approximately
one-third of the total. The system underwent many regulatory changes
in the late 1980s, taking steps toward combating insider trading and
ensuring market transparency.

GERMANY. Germany is the largest economy in all of Europe and is the
third largest economy in the world behind the United States and Japan.
The country occupies a central position in Western Europe with strong
cultural and economic ties with the countries of Eastern Europe and
borders on no less than six other Western European countries. The
country's size, location and proven industrial ability have
historically thrust it to the center of European economic life, a
position it was able to re-attain in the wake of the post-war period.
More recently, Germany has used this position as a platform to
champion the cause of the EU, and also to absorb and transform the
devastated economy of its former communist eastern half.

The German economy is heavily industrialized, with a strong emphasis
on manufacturing. The manufacturing sector is driven by small and
medium-sized companies, most of which are very efficient and dynamic.
Germany, nevertheless, has many large industries and manufacturing is
dominated by the production of motor vehicles, precision engineering,
brewing, chemicals, pharmaceuticals and heavy metal products.

The economy has benefited from a strong export performance throughout
the decade. Exports, weighted heavily in the industrial machinery,
autos and chemicals sectors, have provided the economy with positive
trade balances. Exports are the main engine of GDP growth,
highlighting Germany's dependence on the prosperity of its trading
partners. Five out of its top six trading partners are fellow EU
members (the sixth is the United States), while very low levels of
trade are conducted with Asian and Latin American countries. Germany
stands very well poised to supply the emerging markets of central
Europe. It is already the largest European foreign investor in the
Czech Republic and the largest trading partner for Poland and Hungary.
Accordingly, any weakness in the emerging market economies might
likely dampen demand for German goods, to the detriment of the German
economy. As most of these emerging markets aspire to join the EU, it
is possible that a larger EU could alter Germany's trading
relationships due to new quotas, tax rates, exchange rates and other
factors which will come with EU membership.

The recent performance of the German economy must be evaluated within
the context of the 1990 reunification of the eastern and western
states. GDP growth dropped markedly during the early years of
reunification. Industry in Eastern Germany is still catching up.
Workers in Eastern Germany earn two-thirds of western wages but
produce only half as much. In addition, one of the byproducts of
assimilating East Germany into the state has been the need to
restructure many of the government services to accommodate the new and
substantially less affluent citizens. Significant tax and welfare
reforms have yet to be undertaken, and pressure is mounting on the
government to address these issues. Unemployment rates have begun to
cause some discontent among German citizens whose culture generally
places strong emphasis on a social compact.

Germany is faced with other significant economic challenges.
Unemployment is currently above 12% as the country experiences its
longest period of slow growth since the Second World War. The
government's ability to deal with the problem is limited by its
efforts to meet the stringent Maastricht criteria for convergence.
There are also growing concerns about the exodus of German companies
relocating abroad in order to avoid the country's high labor costs. In
the longer run, Germany's government must alter the peculiar mix of
capitalism, welfarism and consensus that sets the country apart. Those
decisions will be politically sensitive - especially if they
antagonize the powerful trade unions or the country's many family-run
firms.

Germany's stock market has enjoyed dramatic growth in volume as the
main DAX index has soared over the past two years. Much of the
market's strength has been attributed to the dollar's recovery and
rising corporate earnings. In addition, a number of changes have
occurred recently to support the share-buying explosion and to
establish a German equity culture. A number of initial public
offerings were launched as the government sought to divest itself of
ownership in such businesses as the nation's telephone utility and
post office businesses to ease budgetary pressures. The government
also created a supervisory authority which has outlawed insider
trading and established stiffer company reporting standards intended
to further increase the appeal of Germany's stock market.
Nevertheless, while there has been progress in broadening the investor
base, shares remain overwhelmingly in the hands of institutions and
companies.

The German central bank is one of the world's strongest and most
independent. Their high interest rates have contributed to a
controlled growth of the stock market and a steadily decreasing
inflation rate. Keeping the Deutsche Mark strong in leading up to EMU
was a priority for the bank. Nevertheless, exports have thrived
despite the currency's strong position.

A founding member of the EU and the most ardent proponent of EMU,
Germany is seen as the primary player in Union economics and politics.
Seeking to consolidate this position, recent government policy has put
a strong emphasis on the maintenance of a strong currency and the
achievement of the Maastricht criteria.

NORDIC COUNTRIES. Increasing economic globalization and the expansion
of the EU have forced the Nordic Countries to scale back their
historically liberal welfare spending policies. While public spending
has dropped from average levels, the cutbacks in social programs have
sparked drops in domestic demand and increases in unemployment.
Nevertheless, the Nordic economies are experiencing positive growth
fueled largely by strong exports and low interest rates. The EMU put
pressure on each nation to maintain their economies in line with
requirements of the Maastricht treaty criteria and the fiscal and
political issues remain central in political debates.

Of the Nordic countries, Finland, Denmark and Sweden are all members
of the EU. Only Norway has elected not to join. However, the decision
likely will not isolate the Norwegian economy from those of its Nordic
neighbors. The country maintains a "shadow membership" in the EU, by
which it seeks to stay as closely informed as possible and to make its
voice heard on the issues. This may ensure that it will become more
closely aligned with the rest of Europe as time passes. One
significant aspect of opting out of the EU is that the central bank is
free to pursue its own agenda, such as setting inflation targets as
opposed to exchange rate targets. Inflation patterns and currency
stability could prove to be issues that may separate the policy
decisions of Norway from the other Nordic countries.

Politically, the countries of this region are historically known for
their approach to policy making that emphasizes consensus. The most
common type of government among the Nordic countries is dominated by
long-standing, left-of-center parties which often align themselves
with smaller centrist parties for majority support. The landscape,
however, is so fractured that governing from a minority position is
common. The absence of a clear majority party slows and sometimes
arrests policy making. The strongest opposition comes from traditional
European conservative parties, which have gained support in recent
years with the decline of the welfare state and the need for the
libertarian policies necessary to compete and integrate with free
markets. None of the Nordic countries face any serious risk of any
anti-democratic political change. However, in Sweden, the prospects of
the present government will depend on its ability to create more jobs
and maintain the economy for EMU. A large minority of voters are also
disappointed about the benefits which membership in the EU was
expected to bring and have been increasingly voicing anti-EU
sentiments. However, in May 1998, Finland was formally admitted in the
"first wave" of the EMU.

Industry in the region is heavily resource-oriented. Denmark's
agricultural sector remains the backbone of the economy although other
industries have been developing rapidly in recent years, with
engineering, food processing, pharmaceuticals, brewing and
shipbuilding gaining in importance. Finland's major industry is
forestry which supplies a large paper and timber products sector. It
also produces household goods and telecommunications equipment and has
an extremely important heavy goods sector producing ships, cement,
steel and machine tools. In Sweden, the manufacturing sector dominates
the economy and includes major industries which range from motor
vehicles to aerospace, chemicals, pharmaceuticals, timber, pulp and
paper. Several of the country's export-oriented industries (in
particular forestry, mining and steel) are suffering as the country's
high wages squeeze them out of foreign markets. Norway's oil-driven
economy has provided its citizens with one of the highest standards of
living in the world. However, they must prepare for the time, due to
arrive early in the next century, when their vast reserves run out.
Reliance on exports concentrated in a few sectors tie these countries
closely to one another.

Economically, the Nordic countries are strong export economies that
take advantage of their abundant natural resources. They are also very
closely tied both to each other and to the rest of Europe. Most
countries have witnessed low levels of positive growth in the last six
years. Finland is the exception. As a significant portion of its trade
is with Russia, Finland suffered in the early years of the collapse of
the Soviet Union. However, in the past two years its economy has
recorded some of the highest growth rates in Western Europe while
having the lowest rate of inflation. Similarly, after five years of
recession, the overall outlook for the Swedish economy is also vastly
improved. A stringent package of spending cuts and tax increases has
brought down the budget deficit to a level that is well within the EMU
target. Exports are recovering as other parts of Europe are coming out
of recession and its inflation is among the lowest in Western Europe.
However, the one weak spot in both countries' economies is a
persistently high unemployment rate. Finland's unemployment, at 17%,
is the second highest in Europe after Spain, and Finland's rate
represents only a marginal improvement over the previous year.
Norway's oil driven economy is the envy of many and unemployment is
just a little over five percent.

A portion of the region's unemployment woes can be attributed to the
cultural ethic which was advanced during the years of the welfare
state. Subsequent cuts in public spending, particularly in those
sectors that traditionally rely on large government spending,
exacerbated the problem. Labor market reform will be a critical issue
in these countries as public spending is cut back. Pensions and
structural issues such as union regulations all need to be reformed, a
task which brings both challenges and unpopularity to the government
that accepts it. Not only will labor market reforms give governments a
daunting challenge; they could also cause the public to regret their
participation in the EMU. One positive point is that the countries
boast very high standards of living, which create healthy and highly
educated workforces.

The stock markets in Scandinavia are of medium size, and frequently
are strongly influenced by a small number of large multinational
firms. For example, in Sweden thirty firms constituted 75% of the
market's total capitalization and market turnover in 1997. Weighing
heavily in the equity markets are the electronics, forest products,
mining and manufacturing sectors. Market capitalization is highest in
Sweden at $273 billion, while the others are between $74 and $94
billion. Sweden also leads in numbers of firms (261) listed. Other
countries' listings range from 126 (Finland) to 249 (Denmark).
Performance of Nordic country indexes tend to be skewed owing to the
dominant weightings that a few large companies have in the index. For
example, the market capitalization of Finnish telecommunications
equipment manufacturer Nokia comprises about one-third of the total
market capitalization of the Finnish exchange and has a substantial
impact upon the performance of the companies in the HEX Index.

UNITED KINGDOM. The United Kingdom is the world's sixth largest
economy and is home to one of the oldest, most established, and most
active stock markets. An island nation, it built an empire of
strategically located trading posts such as Hong Kong and India. While
today the empire is largely dissolved, trade remains a very key
component of the U.K. economy. Strong domestic sectors are services,
natural energy resources, and heavy industry, including steel, autos,
and machinery. Imports generally emphasize food and manufacturing
components. The United Kingdom's trading partners are predominately
established market economies, such as the United States, Japan, and
other member countries of the European Union. The United Kingdom, via
the North Sea, also has substantial petroleum resources.

The London Stock Exchange is comprised of six offices scattered
throughout Great Britain and Northern Ireland. It lists over 2900
firms, and trades both foreign and domestic securities as well as
securities issued by the British Government. A vast majority of the
firms listed (80%) are from the United Kingdom. Total market
capitalization in 1997 was over $5,440 billion. Such size prevents the
stock market from being overly sensitive to the performance of
individual firms.

In 1997 the U.K. posted its sixth year of recovery with GDP growth of
3.5%, the third highest in the EU. The labor market also appears to
have improved as pay settlements and wages remain under control
despite the unemployment rate falling from 6.5% to 5% over the year.
The strengthening economy prompted a sharp acceleration in consumer
spending and, in response, the nation's Monetary Policy Committee was
forced to raise base rates. The interest rate rise added fuel to an
already robust sterling which rose 8.6% in 1997 after appreciating by
15.6% in 1996. This proved particularly damaging to the manufacturing
sector and, although exports held up well during the year, there were
early indications that a decline was underway. Inflation is low,
making the country attractive for foreign investment. Investment is
especially attractive to the United States, with which the United
Kingdom shares many market similarities. Each country is the other's
largest foreign investment partner.

Under Conservative Party leadership in the early 1980s, the United
Kingdom privatized many state-run utilities, such as British Gas and
British Telecom. The success of these efforts is evidence both of the
strong entrepreneurial spirit of British society and also a
fundamental rejection of the welfare state policies that dominated the
scene in the early post-war period. Even today, the Labour Party has
shed much of its socialist economic platform, reflecting a strong
break away from policies that continue to be popular in other European
countries. Eager to attract foreign investment the new administration
is not expected to undo any of the major reforms put in place by the
Conservatives during their last 18 years in power. Some changes could
include an increase in spending on social programs, a slowing of
privatization, and an increase in corporate taxes. Tight monetary
policy and interest rate hikes could be used to keep inflation below
the government's self-imposed 2.5% ceiling. In addition, the
government will probably wish to rebuild ties with the rest of the EU
and has already taken steps to get the pound back into the European
system by increasing the independence of the country's central bank.

Nevertheless, there appears to be some nervousness among many
investors who see the U.K. market lagging behind the continental
European stock markets where they see more compelling prospects for
economic growth. In addition, the manufacturing industry is suffering
from the pound's lofty valuation and many fear that an economic
slowdown could spread to the services sector.

The political scene in London is largely shaped by positions regarding
EMU. Pro Europe MPs in the Tory opposition leadership were
marginalized after the 1997 election, further polarizing the positions
of the two parties. Despite this expression of support, the United
Kingdom continues to be overtly less enthusiastic about EMU than other
countries in Europe and has not committed itself to immediately
joining the new currency once it is established. While the new
government has stated that it hopes to meet the Maastricht criteria,
it is less a self-imposed pressure on the U.K. government than it is
for other countries in the Union. Signing on to the EU Social Charter
would neutralize the policies which have set the United Kingdom above
other countries in attracting investment, such as wages and employment
conditions.

SPECIAL CONSIDERATIONS REGARDING ASIA

Asia has undergone an impressive economic transformation in the past
decade. Many developing economies, utilizing substantial foreign
investments, established themselves as inexpensive producers of
manufactured and re-manufactured consumer goods for export. As
household incomes rose, middle classes increased, stimulating domestic
consumption. In recent years, large projects in infrastructure and
energy resource development have been undertaken, and have benefited
from cheap labor, foreign investment, and a business friendly
regulatory environment. During the course of development, democratic
governments fought to maintain the stability and control necessary to
attract investment and provide labor. Subsequently, Asian countries
today are coming under increasing, if inconsistent, pressure from
western governments regarding human rights practices.

Manufacturing exports declined significantly in 1997, due to drops in
demand, increased competition, and strong performance of the U.S.
dollar. This significant decline is particularly true of electronics,
a critical industry for several Asian economies. Declines in exports
reveal how much of the recent growth in these countries is dependent
on their trading partners. Many Asian exports are priced in U.S.
dollars, while the majority of its imports are paid for in local
currencies. A stable exchange rate between the U.S. dollar and Asian
currencies is important to Asian trade balances.

Despite the impressive economic growth experienced by Asia's emerging
economies, currency and economic concerns have recently roiled these
markets. Over the summer of 1997, a plunge in Thailand's currency set
off a wave of currency depreciations throughout South and Southeast
Asia. The Thai crisis was brought on by the country's failure to take
steps to curb its current-account deficit, reduce short-term foreign
borrowing and strengthen its troubled banking industry, which was
burdened by speculative property loans. Most of Southeast Asia's stock
markets tumbled in reaction to these events. Investors were heavy
sellers as they became increasingly concerned that other countries in
the region, faced with similar problems, would have to allow their
currencies to weaken further or take steps that would choke off
economic growth and erode company profits. For U.S. investors, the
impact of the market declines were further exacerbated by the effect
of the decline in the value of local currencies versus the U.S.
dollar.

The same kind of concerns that effected Thailand and other Southeast
Asian countries subsequently spread to North Asia. To widely varying
degrees, Taiwan, South Korea and Hong Kong all faced related currency
and/or equity market declines. Due to continued weakness in the
Japanese economy combined with the reliance of Asian economies on
intra-Asian trade and capital flows, most of the region was mired in
their worst recessions since World War II.

Investors continue to face considerable risk in Asian markets as
political, economic and currency turmoil has continued to undermine
market valuations throughout the first half of 1998. Rising
unemployment, food shortages and declining purchasing power could lead
to social unrest and threaten the orderly functioning of government.
Currency devaluations also increase pressure on both the consumers who
must pay more for imported goods and on many businesses that must deal
with the rising costs of raw materials. For U.S. investors, weakening
local currencies erode their returns in these markets upon currency
translation. Certainly, the resolve of the region's governments to
adhere to International Monetary Fund-mandated benchmarks will be
sorely tested, as their implementation could further exacerbate these
pressures on the nation's populace and businesses. In addition,
Japan's paralysis is fast becoming a problem for Asia. Worsening
Japanese banking problems could lead to a contraction of credit for
all of Asia and slow rehabilitation in the region. Similarly, a
significant portion of both domestic and foreign investors have fled
these markets in favor of safer havens outside of the region and will
not likely return until they see more evidence that these problems are
being effectively addressed. The scope and magnitude of the tasks that
these countries face in resolving their problems could mean that
investors will see a continuation of high market volatility over an
extended period.

JAPAN. A country of 126 million with a labor force of 64 million
people, Japan is renowned as the preeminent economic miracle of the
post-war era. Fueled by public investment, protectionist trade
policies, and innovative management styles, the Japanese economy has
transformed itself since World War II into the world's second largest
economy. An island nation with limited natural resources, Japan has
developed a strong heavy industrial sector and is highly dependent on
international trade. Strong domestic industries are automotive,
electronics, and metals. Needed imports revolve around raw materials
such as oil, forest products, and iron ore. Subsequently, Japan is
sensitive to fluctuations in commodity prices. With only 19% of its
land suitable for cultivation, the agricultural industry is small and
largely protected. While the United States is Japan's largest single
trading partner, close to half of Japan's trade is conducted with
developing nations, almost all of which are in southeast Asia.
Investment patterns generally mirror these trade relationships. Japan
has over $100 billion of direct investment in the United States.

The Tokyo Stock Exchange (TSE) is the largest of eight exchanges in
Japan. The exchanges divide the market for domestic stocks into two
sections, with larger companies assigned to the first section and
newly listed or smaller companies assigned to the second. In 1997,
1,805 firms were listed on the TSE, 96% of which were domestic. Some
believe that the TSE has a tendency to be strongly influenced by the
performance of a small circle of large cap firms that dominate the
market. The two key indexes are the Tokyo Stock Price Index (TOPIX)
and the Nikkei. In 1997, TSE performance was disappointing, with the
TOPIX down 28% for the year.

Since Japan's bubble economy collapsed seven years ago, the nation has
drifted between modest growth and recession. By mid-year 1998 the
world's second largest economic power had slipped into its deepest
recession since World War II. Much of the blame can be placed on
government inaction in implementing long-neglected structural reforms
despite strong and persistent proddings from the International
Monetary Fund and the G-7 nations. Steps have been taken to institute
deregulation and liberalization of protected areas of the economy, but
the pace of change has been disappointedly slow.

Unemployment levels, already at record rates when measured by the
broader criteria used in many other countries, have been an area of
increasing concern and a major cause of recent voter dissatisfaction
with recent governments. However, the most pressing need for action is
the daunting task of overhauling the nation's financial institutions
and securing public support for taxpayer-funded bailouts. Banks, in
particular, must dispose of their huge overhang of bad loans and trim
their balance sheets in preparation for greater competition from
foreign financial institutions as more areas of the financial sector
are opened. Successful financial sector reform would allow Japan's
financial institutions to act as a catalyst for economic recovery at
home and across the troubled Asian region. Further steps toward
complete financial liberalization are in the initial stages of
implementation. Proposals under consideration could lower many
barriers allowing foreign firms greater and cheaper access to funds,
and the recent relaxation of restrictions on the insurance market also
promise greater access to foreign companies. A large factor in
determining the pace and scope of recovery is the government's
handling of deregulation programs, a delicate task given the recent
changes in Japanese politics.

Recent political initiatives in Japan have fundamentally transformed
Japanese political life, ushering in a new attitude which is strongly
reverberating in the economy. The Japanese Parliament (the Diet) had
been consistently dominated by the Liberal Democratic Party (LDP)
since 1955. The LDP dynasty, recently fraught with scandal,
corruption, accusations of maintaining a virtual monopoly, effectively
ended in 1994 as a result of electoral reform measures that brought
Diet seats to previously underrepresented areas. The first election
under this new system was held in October 1996. While the LDP remained
as the ruling party, it did so from a minority position. A key result
of the electoral reforms has been a strengthening of ideas of
opposition parties. Indeed, many of the LDP's recent reforms
originated with the leaders of the opposition New Frontier Party. The
LDP's ability to consistently produce bold innovations in a
politically competitive environment is untested. The opposition
parties suffer from structural and organizational weaknesses.
Infighting and defections are common. This inexperience with a true
multi-party system has caused the rise and fall of four coalition
governments in recent years. Between the adjusting of the monolithic
LDP to a more demanding and competitive system and the settling of the
opposition parties, Japan's political environment remains unstable.
The desire for electoral reform arose out of what many see as a basic
change in Japanese public opinion in recent years. Faced with
recurring scandal and corruption, Japanese society has come to demand
more accountability from their leaders, more transparency in their
institutions, and less interference from their intensely bureaucratic
government. This attitude was reflected in the results of the recent
election where candidates of the LDP party were heavily defeated in an
election for the upper house of parliament and prime minister
Hashimoto was forced to resign. The election results were considered
to be a repudiation of the government's failure to come to grips with
the country's economic decline, widening corruption scandals and a
lack of any discernable progress in addressing the nation's banking
problems.

Nevertheless, sustaining reforms and recovery are not guaranteed.
Drops in consumption, increased budget deficits, or halting
deregulation could exacerbate the nation's economic woes. Furthermore,
as a trade-dependent nation long used to high levels of government
protection, it is unclear how the Japanese economy will react to the
potential adoption of the trade liberalization measures which are
constantly promoted by their trading partners. In addition, as the
largest economy in a rapidly changing and often volatile region of the
world, external events such as the Korean conflict could effect Japan.
As many of the governments of Southeast Asia frequently face domestic
discontent, and as many of these countries are Japanese trading
partners and investment recipients, their internal stability and its
impact on regional security are of tremendous importance to Japan.

Also of concern are Japan's trade and current-account surpluses. If
they continue to grow, they could lead to an increase in trade
friction between Japan and the United States. Additionally, with
inflationary pressures largely absent and wholesale prices falling,
Japan may be entering a period of deflation. A deflationary
environment would both hit corporate profits and increase the debt
burden of Japan's most highly leveraged companies.

CHINA AND HONG KONG. China is one of the world's last remaining
communist systems, and the only one that appears poised to endure due
to its measured embrace of capitalist institutions. It is the world's
most populous nation, with 1.22 billion people creating a workforce of
699 million people. Today's Chinese economy, roughly separated between
the largely agricultural interior provinces and the more
industrialized coastal and southern provinces, has its roots in the
reforms of the recently deceased communist leader Deng Xiaoping.
Originally an orthodox communist system, China undertook economic
reforms in 1978 by providing broad autonomy to certain industries and
establishing special economic zones (SEZs) to attract foreign
investment (FDI). Attracted to low labor costs and favorable
government policies, investment flowed from many sources, with Hong
Kong, Taiwan, and the United States leading the way. Most of this
investment has been concentrated in the southern provinces,
establishing manufacturing facilities to process goods for re-export.

The result has been a steadily high level of real GDP growth,
averaging 11.35% per year so far this decade. With this growth has
come a doubling of total consumption, a tripling of real incomes for
many workers, and a reduction in the number of people living in
absolute poverty from 270 to 100 million people. Today there is a
market of more than 80 million people who are now able to afford
middle class western goods.

Such success has not come without negatives. As a communist system in
transition, there still exist high levels of subsidies to state-owned
enterprises (SOE) which are not productive. At the end of 1997, it was
reported that close to half of the SOEs ran losses. In addition, the
inefficiencies endemic to communist systems, with their parallel (thus
redundant) political, economic and governmental policy bodies,
contribute to high levels of inflation. Fighting inflation and
attempting to cool runaway growth has forced the government to
repeatedly implement periods of fiscal and monetary austerity.
Periodic intervention seems to be their chosen method of guarding
against overheating.

Performance in 1997 reflects this dynamic between growth, inflation,
and the government's attempts to control them. Growth slowed to 9.1%,
largely as a result of a tightening of credits to SOEs. Policy was a
mix between a loose monetary stance and some relatively austere fiscal
positions. While growth was a priority, it came at the cost of
double-digit inflation.

China has two stock exchanges that are set up to accommodate foreign
investment, in Shenzhen and in Shanghai. In both cases, foreign
trading is limited to a special class of shares (Class B) which was
created for that purpose. Only foreign investors may own Class B
shares, but the government must approve sales of Class B shares among
foreign investors. As of December 1997, there were 51 companies with
Class B shares on the two exchanges, for a total Class B market
capitalization of $2.1 billion U.S. dollars. In 1997, all of China's
stock market indices finished the year below the level at which they
began it. These markets were buoyed by strong speculative buying in
the year's second quarter. Market valuations peaked in September and
were subsequently hit by a heavy sell off from October onwards.

In Shanghai, all "B" shares are denominated in Chinese renminbi but
all transactions in "B" shares must be settled in U.S. dollars. All
distributions made on "B" shares are also payable in U.S. dollars, the
exchange rate being the weighted average exchange rate for the U.S.
dollar as published by the Shanghai Foreign Exchange Adjustment
Center. In Shenzhen, the purchase and sale prices for "B" shares are
quoted in Hong Kong dollars. Dividends and other lawful revenue
derived from "B" shares are calculated in renminbi but payable in Hong
Kong dollars, the rate of exchange being the average rate published by
the Shenzhen Foreign Exchange Adjustment Center. There are no foreign
exchange restrictions on the repatriation of gains made on or income
derived from "B" shares, subject to the repayment of taxes imposed by
China thereon.

China's proven ability to nurture domestic consumption and expand
export markets leads many to believe that the bulk of its growth has
yet to be seen. Most sources, notably the World Bank, predict future
growth levels through the year 2000 of over 7%. This auspicious
indicator notwithstanding, there are a few special considerations
regarding China's future. While this list is not all-inclusive, it
does highlight some internal and external forces that have a strong
influence on the country's future.

To begin with the internal issues, one matter is that infrastructure
bottlenecks could prove to be a problem, as most FDI has been
concentrated in manufacturing and industry at the expense of badly
needed transportation and power improvements. Secondly, as with all
transition economies, the ability to develop and sustain a credible
legal, regulatory, and tax system could influence the course of
investments. Third, environmentalists warn of the current and looming
problems regarding pollution and resource destruction, a common result
of such industrial growth in developing economies which can't afford
effective environmental protection. This is a particularly noteworthy
issue, given the size of the country's agricultural sector. Lastly,
given China's unique method of transition there exists the possibility
that further economic liberalization could give rise to new social
issues which have heretofore been effectively mitigated. One such
issue is the possible dismantling of inefficient state-owned
enterprises, something which is potentially socially explosive given
the communist policy of providing social welfare through the firm.
Exposing what many economists feel is a high level of open
unemployment and widening the gap between the newly empowered business
class and the disenfranchised could pressure the government to retreat
on the road to reform and continue with massive state spending.

Regarding external issues, China's position in the world economy and
its relationship with the United States also have a strong influence
on it's economic performance. The country has recently enjoyed an
almost uninterrupted positive trade balance. As the largest country
amidst the fastest growing region in the world, China and its
multi-million person ethnic diaspora have a significant role to play
in Asian growth. Should China ascend to become a member of the World
Trade Organization (WTO), as it desires, such movements of capital and
goods will become easier.

Export growth in China has recently been subject to fluctuations
caused by external political events, such as the U.S. elections and
debates over human rights issues. U.S. policy (specifically most
favored nation status) is frequently reconsidered by various elements
of the U.S. government in reaction to a variety of issues, from
nuclear proliferation to Tibetan rights. Significant changes in U.S.
policy could impact China's growth, as close to 9% of their GDP is
trade with the U.S. and the U.S. represents the third biggest investor
in China.

Perhaps the strongest influence on the Chinese economy is the policy
that is set by the political leaders in Beijing and this is somewhat
of an open question as the death of Deng has created a slight vacuum
in Chinese political society. A large part of Deng's strength derived
from a newly empowered business class endeared to him and it is
unclear if any of his successors can harness this loyalty as
effectively as he did. Sustained growth is one possible way to win
over this constituency, leading many to believe that the future
Chinese leadership will respect market forces at least as much as Deng
did. Choosing between double digit growth and reduced inflation could
continue to be a central economic question, with 1997 (Deng
influenced) decisions pointing to an acceptance of lower, albeit still
high, GDP growth.

Another key political player is the Chinese army. With provocative
situations occurring in Taiwan and the Korean peninsula, and with ever
present pressure from internal democrats, the military is in a
position of leverage regarding the shaping of the future political
scene. Finally, there is the communist party, long seen as a loser
amongst the beneficiaries of Deng's reforms. Many view the battle
between the party and the middle class as a zero sum game and as the
leadership settles, respective alliances and constituencies could
determine how much the government pursues its growth strategy.

As with almost all foreign investments, U.S. investors face the
significant risk of currency devaluation by the Chinese government.
Despite assurances from officials reemphasizing China's policy
commitment to maintain the current exchange rate of the renminbi
against the U.S. dollar, many observers believe that this policy will
be soon tested as China monitors the effect of regional devaluations
on exports. Government authorities feel that China has boosted its
international reputation by refraining from devaluing the renminbi at
a time when such a move could further destabilize the currencies of
its neighbors. Nevertheless, Chinese authorities have recently hinted
that a continued slide in the Japanese yen would make it very
difficult for them to maintain their promise not to devalue. If
efforts to prevent the slide in the yen fail, then China may be pushed
into devaluing their currency. For U.S. investors, a devaluation would
erode the investment returns on their investments.

The last significant force in the Chinese economy is the acquisition
on July 1, 1997 of Hong Kong as a Special Autonomous Region (SAR). For
the past 99 years as a British Colony, Hong Kong has established
itself as the world's freest market and more recently as an economic
gateway between China and the west.

A tiny, 814 square mile area adjacent to the coast of southern China
with a population of 6.3 million, Hong Kong has a long established
history as a global trading center. Originally a manufacturing-based
economy, most of these businesses have migrated to southern China. In
their place has emerged a developed, mature service economy which
currently accounts for approximately 80% of ITS GROSS DOMESTIC
PRODUCT. Hong Kong trades over $400 billion in goods and services each
year with countries throughout the world, notably China, Japan, and
the U.S. Its leading exports are textiles and electronics while
imports tend to revolve around foodstuffs and raw materials. Hong
Kong's currency, the HK dollar, was pegged to the US dollar at
HK7.7=$1 in 1983 and investors consider it to be a stable mechanism in
enduring confidence lapses and speculator attacks. The operation of a
currency board and accumulation of U.S. dollars in its monetary fund
is partly responsible for this stability.

The stock market (SEHK) listed 658 publicly traded companies by the
end of 1997, with total capitalization at $413 billion U.S. dollars. A
significant portion of SEHK firms are in real estate, and are
sensitive to fluctuations in the property markets. 1997 was a
tumultuous year for the Hong Kong stock market as a speculative attack
on the Hong Kong dollar in October provoked a global sell-off in
equities. Investors were shocked as the Hong Kong market, long
regarded as a safe-haven, plunged 40% in October. The stock market's
decline and the attack on the local currency sent interest rates
soaring, precipitating an erosion in local property values. This in
turn put additional pressure on the banking sector which is heavily
geared to real estate. The Hong Kong market's dramatic downturn
illustrates how vulnerable it is to the Asian region's economic
problems. The structural problems besetting Hong Kong's neighbors in
Southeast and Northeast Asia may not be quickly resolved. Exports to
the Asian region may remain depressed as the process of economic
reform in countries such as Thailand, Malaysia, Indonesia, Japan and
South Korea will likely hold back economic growth in the area.
Accordingly, Hong Kong and China will likely be more dependent upon
demand from the U.S. and Europe for some time to come.

As a trade center, Hong Kong's economy is very closely tied to that of
its trading partners, particularly China and the United States. In the
wake of Deng's reforms, Hong Kong and China have become increasingly
interdependent economically. Currently, China is Hong Kong's largest
trading partner. After Taiwan, Hong Kong is the largest foreign
investor in China, accounting for about 60 percent of overall foreign
direct investment. Hong Kong plays a particularly significant role as
an intermediary in U.S.-China trade. In 1996, it handled 56% of
China's exports to the U.S. and 49% of Chinese imports from the U.S.

The critical question regarding the future of Hong Kong is how the
Chinese leadership will exert its influence now that it has become a
Special Autonomous Region (SAR). This new status is in accordance with
pledges made at the Joint Declaration on the Question of Hong Kong
made by the Chinese and British governments in 1984. Leading up to the
hand over of the colony, the Chinese government has pledged to uphold
the Basic Law of 1990 which states that Hong Kong's status as an
unfettered financial center will remain intact for at least 50 years
after 1997. Part of this status includes retaining the legal,
financial and monetary systems (specifically the HK$/US$ peg) which
guarantee economic freedom and foster market expansion.

Many investors and citizens are closely monitoring Chinese actions in
order to assess their actual commitment to these principles. Already
there is evidence of a clear, if slow, current of political change
coming from Beijing. Certain actions, such as the curbing of media
freedoms, indicate that there is the possibility of significant
interference from communist authorities. More significant was the
clash between the U.K. and Chinese governments over China's abolition
of the elected legislature and subsequent installation of governmental
leaders in both the executive and the legislature who are directly
appointed by Beijing. Mr. Tung Chee-hwa, appointed as the first Chief
Executive of the SAR, has surrounded himself with like-minded
Machiavellian figures who have strong ties to both market successes
and Beijing leaders. They are portrayed as believing in the powers of
capitalism and central authority, if not democracy, leading some to
speculate that the SAR could develop into a South Korean style of
corporatism which preserves the economic status quo without
incorporating further political freedoms.

In assessing the prospects for Hong Kong's future, it must be noted
that China has a very strong interest in a prosperous SAR.
Particularly if Beijing pursues a growth strategy as it has in the
past, Hong Kong can be a key agent in China's economic policy. Desire
for investment and new technologies necessary for modernization is a
strong incentive to send positive signals through the treatment of
Hong Kong. This is reinforced by the respect Hong Kong is due given
its role in China's recent dynamic performance.

To be sure, there are more adamant concerns over the effect of the
acquisition. Many are skeptical of Beijing's ability to leave the
currency alone. Some note the continuous drop in GDP as evidence that
Hong Kong has yet to mature as a service economy and that the
workforce hasn't fully adjusted to the switch out of manufacturing.
Additionally, by tying Hong Kong so closely with China, it now must
weather the ups and downs of Beijing's relationship with the U.S. Most
Favored Nation Status now means just as much, if not more, to the SAR
as it does to Beijing, with some asserting that revoking MFN could
result in substantial losses in trade, income, and jobs.

Hong Kong's competitive advantage has traditionally been a mix of
geography, market freedoms and entrepreneurial spirit. The
preservation of these advantages is now a function of the island's
independence from Beijing. Today's investors will be vigilant in
measuring how much of that independence is retained after July 1,
1997.

AUSTRALIA. Australia is a 3 million square mile continent (about the
size of the 48 continental United States) with a predominantly
European ethnic population of 18.2 million people. A member of the
British Commonwealth, its government is a democratic, federal-state
system.

The country has a western style capitalist economy with a workforce of
9.2 million people that is concentrated in services, mining, and
agriculture. Australia's large agricultural sector specializes in
wheat and sheep rearing and together, these two activities account for
more than half of the country's export revenues. Australia also
possesses abundant natural resources such as bauxite, coal, iron ore,
copper, tin, silver, uranium, nickel, tungsten, mineral sands, lead,
zinc, diamonds, natural gas, and oil. The health of the country's
domestic economy is particularly sensitive to movements in the world
prices of these commodities. Primary trading partners are the United
States, Japan, South Korea, New Zealand, the United Kingdom and
Germany. Imports revolve around machinery and high technology
equipment.

Historically, Australia's strong points were its agricultural and
mining sectors. While this is still true to a large extent, the
government managed to boost its manufacturing sector by undertaking
protective measures in the 1970's and early 1980's. These have
subsequently been liberalized in an effort to spur growth in the
industrial sector. Today's economy is more diverse, as manufacturers'
share of total exports is increasing. Part of the government's effort
to make manufacturing more competitive was a floating of the
Australian dollar in 1984, precipitating an initial depreciation, and
a campaign to reduce taxes. Such reforms have attracted foreign
investment, particularly in the transport and manufacturing sectors.
Restrictions do exist on investment in certain areas as media, mining
and some real estate.

With inflation well under control but unemployment stubbornly high and
signs of cyclical slack in the economy, Australia's monetary policy is
focused on preserving the low inflation environment while keeping
monetary conditions conducive to stronger economic growth. The
government has set a goal of achieving a government budget surplus in
fiscal year 1998/1999.

Australia is fully integrated into the world economy, participating in
GATT and also more regional trade associations such as the Asia and
the Pacific Economic Cooperation (APEC) forum. Future growth could
result from their movement towards regional economic liberalization,
but a countervailing force is the reality that some export markets in
Europe could be lost to continued European economic integration.

After suffering a significant recession in 1990-91, the Australian
economy has enjoyed six years of expansion. The medium-term outlook
appears favorable, with domestic spending supported by low interest
rates, improving consumer confidence and a strengthening labor market.
GDP growth has increased steadily throughout 1997. However, weakness
in commodity prices, particularly metal prices, coupled with an
increase in the nation's current account deficit have placed
significant pressure on the Australian dollar.

Investors should be aware that, while Australia's prospects for strong
economic growth appear favorable over the long-term, many sectors
currently face significant risks arising from the recent turbulence in
Asian countries, which account altogether for almost 60 percent of
Australia's exports. While projections already embody a more subdued
outlook for growth in these countries, there is a risk of this outlook
deteriorating further, especially in Japan and Korea.

Due to the large position that the agriculture and natural resource
sectors have in the nation's export driven economy, any weakness in
commodity prices may negatively impact both the economy and stock
prices. In addition, United States investors face the risk that their
investment returns from investments in Australia could be eroded if
the Australian currency declines relative to the United States dollar.

INDONESIA. Indonesia is a country that encompasses over 17,000 islands
on which live 195 million people. It is a mixed economy that balances
free enterprise with significant government intervention. Deregulation
policies, diversification of strong domestic sectors, and investment
in infrastructure projects have all contributed to high levels of
growth since the late 1980's. Indonesia's economy grew at 7.1% in
1996, the exact average of its performance for the current decade.
Growth in the 1990's had been fairly steady, hovering between 6.5-7.5%
for the most part, peaking at 8.1% in 1995. Moderate growth in
investment, including public investment, and also in import growth,
helped to slowdown GDP growth. Growth has been accompanied by
moderately high levels of inflation.

In recent years, Indonesia had been undergoing a diversification of
the core of its economy. No longer strictly revolving around oil and
textiles, it is now gaining strength in high technology manufactures,
such as electronics. Indonesia consistently runs a positive trade
balance. Strong export performers are oil, gas, and textiles and
apparel. Oil, once responsible for 80% of export revenues, now
accounts for only 25%, an indication of how far other (mostly
manufacturing and apparel) sectors have developed. Main imports are
raw materials and capital goods.

However, as with many of its Asian neighbors, Indonesia's bright
prospects came to a sudden halt in August of 1997 when the plunging
Thai baht began to destabilize the rupiah. By mid-year 1998 the local
currency had fallen more than 80% against the dollar, and hugely
increased the cost of servicing foreign debts; a collapse of the real
economy, and a growing number of bad loans. Various central bank
initiatives, including a doubling of interest rates, failed to halt
the currency's depreciation. The nation's banks, unable to service
their extensive short-term borrowings, were suddenly in danger of
collapse. Of more than 200 local banks, a mere handful were estimated
to be solvent at mid-year 1998.

The social effects of this decline have been devastating. By the end
of 1998 the government expects 47% of the population to be living
below the poverty line and unemployment is expected to surpass 20% of
the workforce. This has led to an increase in social tensions and food
riots and large-scale strikes have broken out sporadically. Rioting
and attacks upon the country's business-oriented ethnic Chinese
population have prompted as many as 80,000 to flee the country. Rising
popular opposition forced President Suharto to resign less than three
months after being appointed to his seventh consecutive five-year term
and was replaced by his vice-president, B. J. Habibie. The political
upheaval and resulting uncertainty has resulted in the further erosion
in public confidence at home and abroad.

The breakdown in public confidence in the Indonesian economy will
likely be difficult to reverse, and will prolong the period of
recovery. Resumption of lending by multilateral institutions under a
rescue package drawn up by the International Monetary Fund (IMF) may
speed up the process of restoring the faith in the government's
efforts to shore up the banking system. Nevertheless, even if the two
critical outstanding issues of restructuring the corporate sector's
external debt and shoring up the banking sector can be resolved this
year, the economy will remain weak in 1999 and recover only slowly in
the following years.

The Indonesian stock market plunged to record lows in 1997 under the
combined impact of the country's economic implosion, political
uncertainty and social unrest. The market's retreat continued into
mid-1998 as domestic and foreign investors fled the market for safer
havens overseas. While many investors believe that the market's steep
decline has brought valuations of a number of Indonesian companies to
very attractive levels, there remains considerable risk particularly
for foreign investors. As with most foreign investments, United States
investors could see their investment returns eroded if the Indonesian
currency declines in value relative to the U.S. dollar. Secondly, any
escalation of rioting and other forms of social unrest could be a
major obstacle in the path of economic recovery. Thirdly, many
question the will of the Indonesian government and its people to
accept the conditions of economic reform as mandated by the IMF.
Fourth, the Indonesian economy, currency and securities markets are
extremely sensitive to events that take place within the Asian region
and their fortunes are somewhat dependent upon how well other Asian
nations resolve their own economic and currency problems.

MALAYSIA. 1997 saw Malaysia's GDP growth slow to 7.4%, down from over
8.2% in 1996 and 9.5% in 1995. Inflation has been kept relatively low
at 3.8%. Performance in 1996 avoided the economy's potential
overheating as export growth, investment, and consumption all slowed.
A large part of Malaysia's recent growth is due to its manufacturing
industries, particularly electronics and semiconductors. This has led
to an increased reliance on imports; thus the economy is sensitive to
shifts in foreign production and demand. This is particularly true
regarding its main trading partners: the United States, Japan, and
Singapore. Such shifts were partly responsible for the slowdown in
1997. In addition, monetary policies to stem the threat of overheating
were evident, but the country still needs massive public and private
investment to finance several large infrastructure projects.
Government industrial policy seeks investment to create more value
added high technology manufacturing and service sectors in order to
decrease the emphasis on low skilled manufacturing. Already U.S.
investors have invested over $9 billion, and most of this is in
electronics and energy projects.

However, like its Asian neighbors, Malaysia has stumbled in its dash
to become a developed nation by 2020. The grandiose ambitions of
Malaysian Prime Minister Mahathir Mohamad have been set back by its
worst-ever currency crisis, which also brought a sharp fall in the
country's stock market. An overheated property market, a growing
current-account deficit and a highly leveraged economy, precipitated
much of the country's problems. Following the sharp decline of
Thailand's currency, the Malaysian ringgit came under severe pressure.
The Malaysian central bank attempted to defend the currency and the
resulting spikes in interbank rates marked the start of a period of
escalating interest rates. Once the central bank ceased using foreign
exchange reserves to slow the ringgit's depreciation in the
region-wide currency slide, the Malaysian currency quickly weakened
versus the United States dollar and by year end had declined by 35%.

By mid-year 1998, the outlook for the Malaysian economy remained bleak
as economists predicted that the economy would shrink by at least 5
percent this year, the first contraction in 13 years. The likelihood
that Malaysia will be forced to seek IMF assistance is increasing.
Although Malaysia does not have the high level of foreign debt that
has overwhelmed its Asian neighbors, domestic lending, at 170 percent
of GDP, was the highest in Southeast Asia when the currency crisis
struck. The nation's banks are now faced with a growing number of
unpaid loans as more businesses are struggling to stay afloat in the
sagging economic environment.

Adding to the bleak outlook is the government's seemingly confused and
erratic response to the nation's serious economic and currency crisis.
The Prime Minister is increasingly at odds with the finance minister
on what policies the country has to institute to remedy the country's
serious problems. Prime Minister Mahathir has abandoned the tight
money, financially conservative recovery policy endorsed by the IMF
and has placed the blame for the nation's troubles on foreign currency
and stock market speculators. The move risks triggering another round
of currency devaluations, inflation and, in the long run, economic
collapse.

Investors should be aware that investing in Malaysia currently entails
a number of potential risks, not the least of which is the
increasingly erratic economic policies of the Malaysian government
that are counter to the advice of the IMF and many of the developed
nations. In addition, the government appears to be escalating its
hostile attitude toward foreign investors. In September of 1998
Malaysian authorities imposed new restrictions on the foreign exchange
and securities markets. Included were limitations in repatriating the
investment proceeds of foreign investors.

While the Malaysian population has been relatively passive during the
first year of the economic meltdown, there could be mounting social
unrest if the crisis is prolonged. Should the country finally adopt
IMF remedies the Malaysian people may be reluctant to accept the
additional sacrifices that they will be called upon to endure. This
could seriously undermine the recovery of Malaysia's economy as well
as its currency and stock market. An increasingly hostile government
towards foreign investors could also lead to additional curbs on the
free access to their funds. As with other Asian markets, currency risk
remains substantial.

SINGAPORE. Since achieving independence from the British in 1965,
Singapore has repeatedly elected the People's Action Party (PAP) as
their government. It is a party that is so consistent it has only
offered up two prime ministers in this 32-year period. Elections in
January 1997 returned the PAP to power, signaling satisfaction with
their policy of close coordination with the private sector to
stimulate investment. Typical policies include selective tax
incentives, subsidies for R&D, and joint ventures with private firms.
While the combination of consistent leadership and interventionist
policies is sometimes seen as impeding civil liberties and
laissez-faire economics, it has produced an attractive investment
environment.

The Singapore economy is almost devoid of agriculture and natural
resources, not surprising given the island nation's geographic size.
Its strongest sector is manufacturing, particularly of electronics,
machinery and petroleum and chemical products. They produce 45% of the
world's computer disk drives. Major trading partners are Japan,
Malaysia and the United States.

The economic situation in Singapore registered a passable year in 1996
but weakened in early 1997, dragged down by the downturn in the global
electronics industry. However, it ended the year on a firmer footing
as real GDP growth rose from 4.1% in the first quarter to 7% by the
fourth quarter. Inflation remained low and the current account balance
maintained its large surplus. Property values have declined recently,
impacted by continuing oversupply.

Although Singapore boasts one of the strongest economies in Asia,
investors in that market face a number of possible risks. Chief among
these is that the country is not immune to the region's economic
troubles, as Singapore's neighbors account for nearly one-quarter of
its trade. Any prolonged regional economic downturn could slow its
growth. In addition, analysts believe that there is considerable
downside risk in the current Singapore dollar exchange rate and any
decline in the Singapore currency versus the U.S. dollar could erode
the investment return of United States investors in that market.

SOUTH KOREA. South Korea has been one of the more spectacular economic
stories of the post-war period. Coming out of a civil war in the
mid-1950's, the country found itself with a destroyed economy and
boundaries that excluded most of the peninsula's mineral and
industrial resources. It proceeded over the next 40 years to create a
society that includes a highly skilled and educated labor force and an
economy that exploited the large amounts of foreign aid given to it by
the United States and other countries. Exports of labor intensive
products such as textiles initially drove the economy and were
eventually replaced by heavy industries such as automobiles.

Hostile relations with North Korea dictate large expenditures on the
military and political uncertainty and potential famine in the north
has put the south on high alert. Any kind of significant military
effort could have multiple effects, both positive and negative, on the
economy. South Korea's lack of natural resources put a premium on
imported energy products, making the economy very sensitive to oil
prices.

Since 1991, GDP growth has fluctuated widely between 5% and 9%,
settling down at 5.6% last year. Currently the labor market is in need
of restructuring, and its rigidity has hurt performance. Relations
between labor and the large conglomerates, or Chaebols, could prove to
be a significant influence on future growth. Inflation in the same
period has been consistently dropping, save a brief rise in 1994 and
finished the year at 4.5%. The country consistently runs trade
deficits, and the current account deficit widened sharply in 1996,
more than doubling to $19.3 billion. South Korea's strong domestic
sectors are electronics, textiles and industrial machinery. Exports
revolve around electronics, textiles, automobiles, steel and footwear,
while imports focus on oil, food, chemicals and metals.

The stock market (Korea Stock Exchange) is currently undergoing
liberalization to include more foreign participation, which was only
first allowed in 1992, but the bond market remains off limits until
1999. Foreign ownership has since been increased to 55% for all listed
stocks except three. The foreign ownership liberalization is in
response to the KSE 1996 performance, which was down 18%. The number
of listed companies totaled 726 in 1997, a decline of 34 from the
previous year, while the market's capitalization plummeted 70 percent
from its 1996 level.

Over the calendar year 1997, the Korean stock market extended its
two-year decline plunging by 42% to its lowest year-end level since
1986. The collapse came as a direct result of the Asian region's
currency crisis and the failure of several Korean conglomerates. In
the summer of 1997, the South Korean won hit record lows against the
U.S. dollar as a series of nationwide labor strikes aggravated the
already escalating trade deficit. Despite aggressive official
intervention to support the local currency, the won had fallen from
860 to 914 to the U.S. dollar by year-end.

The Korean market poses risks for current and prospective investors.
The Korean government will need to maintain public support to
implement the radical and difficult restructuring of the economy
demanded by the IMF under a $58 million loan package. This opposition
could come from the country's major conglomerates that have yet to
institute necessary restructuring initiatives, and from workers
protesting against rising unemployment.

In addition, relations with its long-standing enemy, North Korea have
been worsening as widespread famine could prompt another attack on its
southern neighbor to divert the attention of its people from their
suffering. More importantly, South Korea's heavy reliance on exporting
to the Asian region holds its economy hostage to the economic fortunes
of its neighbors.

THAILAND. The Thai economy has witnessed a fundamental transition in
recent years. Traditionally it was a strong producer of textiles,
minerals and agricultural products, but more recently it has tried to
build high technology export industries. This proved particularly
fortuitous in the mid 1990s when flooding wiped out much of their
traditional exports, but the newer industries remained strong, keeping
the growth rate above 8%. (This level had been achieved through the
1990s, giving the economy a name as one of the fastest growing in the
region.) Successive governments have also taken steps toward reducing
the influence of central planning, opening its market to foreigners
and abandoning five-year plans. This restructuring is still underway,
and the change can cause difficulty at times.

The political situation in Thailand is tenuous. Democracy has a short
history in the country, and power is alternatively obtained by the
military, a non-elected bureaucratic elite, and democratically elected
officials. The frequent transfers of power have generally gone without
divisive, bloody conflicts, but there are bitter differences between
the military and the political parties. Free elections in 1992 and
again in 1995 have produced non-military democratic leaders from
different parties, a healthy sign of party competition. More recently,
the dramatic downturn in the economy generated demands from all
sectors of society for the resignation of Prime Minister Chavalit. The
worsening economic situation threatened social stability of the nation
and the Prime Minister resigned after barely one year in power.

In 1997 GDP contracted by approximately 0.3%, compared with 7.2%
growth in 1996 and 8.6% in 1995. The 1997 current account deficit was
1.9% of GDP as against 7.9% in 1996. Inflation was 5.6%, however, the
government has projected a 16.2% rate for 1998. One cause for
Thailand's economic downturn was a decline in export growth as its
manufacturing industry faces stiff competition from low priced
competitors and its agriculture has suffered a severe drop in
production. In 1996, Thailand's currency, the baht, was linked to a
U.S. dollar dominated basket, and monetary policy had remained tight
to keep that link strong and avoid inflationary pressures.

The situation changed in early 1997, however, with the revelation of
many bad bank loans and a bubbling of property prices due to
over-investment. Many companies, faced with slowing exports, stopped
servicing their debts. Many other firms have stayed alive only with
infusions of public cash, and the government has been slow to let many
property laden financial firms fail. The stock market has reacted
strongly, dropping to new lows for the decade. Reluctant to float the
baht, indeed promising that it wouldn't, the government relented in
early July hoping to revive export and stock market growth. The
subsequent devaluation (approximately 20% against the dollar in the
first month) led to the need for a $16 billion loan coordinated by the
IMF to shore up foreign reserves. Most of the loan came from
neighboring countries led by Japan, indicating their desire to both
protect their own investments in Thailand, and also mitigate the
effect of the devaluation on their home currencies.

The total impact of the entire situation is negative, particularly on
inflation, unemployment and foreign debt. Significant turnover and a
major gamble on the currency has put the government in a precarious
position, especially given the fact that it is a six party coalition.
Dissatisfaction amongst the military, always a political factor, is
high.

The new Thai government has produced mixed results in their efforts to
remedy the country's serious economic woes. Crucial to Thailand's
recovery are both the outcome of newly instituted economic and banking
reforms and the outlook for both China's and Malaysia's economies.
Looking forward, currency risk remains high and the baht will likely
be highly vulnerable to regional contagion.

INDIA. India is the second most populous and seventh largest country
in the world. Although the country occupies only 2.4% of the world's
land area, it supports over 15% of the world's population. Only China
has a larger population. The Indian government is classified as a
federation, or union, and is, under its constitution a "sovereign,
socialist, secular, democratic republic" composed of 25 states and 7
union territories. Like the United States, it has a federal form of
government. However, the central government in India has greater power
in relation to its states, and is patterned after the British
parliamentary system.

India's population was estimated at 952 million in 1997 and has been
projected to double by the year 2028. Religion, caste, and language
are major determinants of social and political organization. Although
83% of the people are Hindu, India also is the home of more than 120
million Muslims - one of the world's largest Muslim populations.
Despite economic modernization and laws countering discrimination
against the lower end of the class structure, the caste system remains
an important factor in Indian society.

India has the world's fifth largest economy in terms of purchasing
power parity. About 62% of the population depends directly on
agriculture. Industry and services sectors are growing in importance
and account for 29% and 42% of GDP, respectively, while agriculture
contributes about 29%. More than 35% of the population lives below the
poverty line, but a large and growing middle class of 150 - 200
million has disposable income for consumer goods. In the industrial
sector, India now manufactures a variety of finished products for
domestic use and export.

India gained independence in 1947 after two centuries of British
colonial rule. Economic policies in the first four decades of
independence were driven by its leaders' deep distrust of foreign
economic interests and admiration for the Soviet model of centrally
planned industrialization. Accordingly, the country has followed a
policy regime that has been characterized by extreme protectionism and
public sector dominance in strategic sectors. Nevertheless, India has
developed a large and diversified private sector, and agriculture has
remained almost entirely in private hands.

India's treatment of foreign investment has been alternatively
encouraging, ambivalent or difficult, depending on the industry sector
involved. Most industries are open to limited investment by
multinational companies while others are closed to foreign investors.
Sectors closed to foreign investment currently number five: mineral
oils; railway transport; war ships and the military-related areas of
aircraft; atomic energy; and associated minerals. Although recent
measures have liberalized the investment limits on a number of major
industries, several political parties, deeply hostile to foreign
investment, have made these issues the subject of pre-election
rhetoric.

India has a large and active stock market which ranks twentieth
globally in market value. There are 23 recognized stock exchanges in
India. The BSE is the premier exchange; accounting for more than
one-third of trading volume, over 70% of listed capital and over 90%
of market capitalization. As of the end of 1997 there were 5,842
listed companies on the BSE with a total market value of US$128.27
billion.

Relations between India and its neighbors have been fraught with
difficulties. India disputes Pakistan's claims to part of Kashmir, and
repeated attempts at mediation have not resolved this conflict. The
dispute has triggered wars between the two countries in 1947, 1965 and
1971. More recently, India's nuclear tests prompted Pakistan to reply
in kind, despite Western efforts to dissuade it. Economic sanctions
imposed by the U.S. and other industrialized countries following the
nuclear tests in May of 1998 have not been without consequences. While
their short-term, direct effect on the economy has been relatively
modest, the indirect and medium-term consequences of sanctions could
become more serious. Relations with Nepal, with Bhutan and with China
are marred by China's two territorial claims in the nation's east and
north. Historical suspicions remain following the 1962 border war
between India and China and the two countries have continued to work
towards expanding their political and economic influence in the South
Asian region.

While India presents many attractions for U.S. investors, there are a
number of factors that could pose considerable risk to those investing
in this market: Contemporary politics have become increasingly
unpredictable since the resounding defeat of Congress in 1996 after
decades at the helm. The alignment of political forces has become
increasingly erratic among factions, parties and interest groups. Some
factions within the current administration have been hostile to
foreign investment and could impose measures that would be detrimental
to the interests and rights of these investors.

India's foreign relations in the region remain fragile and the
possibility of increased tensions or open warfare is an ever-present
danger to the stability of the market. In addition, the monetary cost
of economic sanctions resulting from recent nuclear tests could
substantially impact economic growth and corporate profits. Sanctions
affect India in several ways. Crucially, there will be a deferment or
loss of direct aid and concessional loans, from multilateral agencies
(notably the World Bank) and bilateral donors (the U.S., Japan and
Canada, among others). The loss of export credit and guarantees,
notably from the US Export-Import Bank could delay and increase the
cost of large infrastructure and foreign investment projects. This, in
turn, could have a negative impact upon creditor and investor
confidence in the Indian market.

Relative to the more mature markets of the world, the level of
corporate disclosure in India is very low and companies are generally
less disposed to act in the best interests of their shareholders.
Accordingly, investors face a much more difficult task in ascertaining
the true investment worth of a particular stock.

As with most other emerging markets, the Indian market has been
negatively impacted by recent economic and currency turmoil in the
world's less developed regions and is likely to be similarly impacted
in any future weakness. Currency fluctuation is an additional risk to
U.S. investors as any weakening in the value of the Indian rupee
versus the U.S. dollar could erode the value of their investments upon
currency translation.

TAIWAN. Taiwan is one of the most densely populated countries in the
world, with a population of over 20 million, or 1,504 persons per
square mile. Most Taiwanese are descendants of immigrants who came
from China's Fukien and Kwantung provinces over 100 years ago.
Mandarin is the official language while English is taught to all
students as their first foreign language, beginning in the seventh
grade.

Although settled by Chinese in the seventeenth century, Taiwan (also
called Formosa) was ruled by Japan from 1895-1945 and subsequently
reverted to Chinese administration at the end of World War II. In
1949, nationalist leader Chiang Kai-shek took control of the island
after fleeing mainland China with two million supporters, following
his defeat at the hands of the communists. Since that time, Taiwan has
been governed by the right-wing Kuomintang (KMT) which was founded by
Chiang Kai-shek. In 1996 the island held its first popular
presidential elections in which the KMT retained its control.

Both the Taipei and Beijing governments consider Taiwan an integral
part of China. The KMT has vowed to reconquer the mainland while The
People's Republic of China has urged Taiwan to accept a peaceful
reunification with the mainland. China has proposed that they regain
sovereignty over Taiwan on the basis of a "`one country - two
systems'" arrangement similar to that of the recent reunification of
Hong Kong. Nevertheless, China has periodically threatened to annex
Taiwan through military action.

Under the KMT government, Taiwan achieved a remarkable record of
economic growth with the assistance of massive U.S. aid in the early
years of the post war period. Today, Taiwan has one of the world's
strongest economies and is among the ten leading capital exporters.
Between 1980 and 1990 real GDP expanded at an average annual rate of
7.9%. During 1990-95 an annual GDP growth rate of 6.6% was recorded.
In 1996, compared with the previous year, GDP increased by 5.7% in
real terms, while it was anticipated that growth would exceed 6.0% in
1997 and 1998. Between 1960 and 1973 the island's exports rose 20 fold
and real GDP increased 3.3 times. Even more remarkable, as the shift
of millions of people from villages to cities took place, was the high
level of employment. Between 1964 and 1995 the unemployment rate
rarely exceeded 2% of the work force in any year.

Prior to 1967 foreign sources played a large role in financing
capital formation expansion, but thereafter domestic savings financed
the entire growth of net capital formation. By 1986 the ratio of
national gross savings to GDP had reached 38.5%. Thereafter the ratio
declined, standing at 26.0% in 1996. The expansion of foreign trade
was the major reason for Taiwan's rapid capital growth. Much of the
growth in exports could be attributed to the competitiveness of its
exports in price and quality in world markets.

Since the mid-1990s the island's traditional reliance upon light
industry has gradually given way to high technology activities, as
emphasis shifted from labor-intensive to capital-intensive production.
The electrical and electronic machinery sector continued to show
particularly strong growth in the 1990s as did the chemical sector.
Taiwan also has eleven vehicle manufacturers, all of which have
contracted joint ventures with foreign companies. By the mid-1990s
Taiwan had become one of the world's largest producers of personal
computers and semiconductors.

Taiwan has a large and active stock market ranking twelfth by market
value among the world's markets. The TSE in Taipei is the only
official stock exchange in Taiwan, although there is also a small OTC
market. At the end of 1997 there were 404 companies listed on the TSE
with a market capitalization of US$288.1 billion. The market is
dominated by individual investors, who account for 90.7% of total
turnover in listed shares. Many local institutions, such as banks,
insurance companies or pension funds, are prohibited or restricted
from investing in listed shares. Foreign individuals and institutional
investors meeting certain criteria have been able to invest in the
market directly since 1990 but are subject to certain limits. Foreign
involvement in the market through qualified foreign institutional
investors and mutual funds is small but growing.

Investing in Taiwan entails special risks as well as those risks that
are common to other emerging markets. Taiwan's relations with The
People's Republic of China remain fragile. The conflict between the
entrenched nationalization of China and the nascent nationalism of
Taiwan persists and armed conflict between the two nations remains a
possibility. Beijing continues its policy of attempting to isolate
Taiwan and could use its growing economic power and political
influence to interfere with the nation's trade with the rest of the
world's economies.

In addition, the Taiwan market has been one of the most volatile in
Asia over the past decade. The country did not escape the effects of
the Asian economic and currency crises in 1997 and 1998 and could
continue to be negatively impacted by an extension of the current
regional turmoil. The nation's heavy dependence upon trade and
manufacturing partnerships with foreign companies also leaves it
particularly vulnerable to downturns in the global economies. Currency
fluctuation is an additional risk to U. S. investors as any weakening
in the value of the local currency versus the U.S. dollar could erode
the value of their investments upon currency conversion.

THE PHILIPPINES. The Philippines is a developing democratic republic.
After 300 years of Spanish rule, the United States acquired the
Philippines from Spain in 1898 and ruled for 48 years. The country
subsequently gained its independence from the United States in 1946.
The nation, as provided by the 1987 Constitution, is a democratic
republican state with a presidential form of government. However,
since its independence, the government has been periodically roiled by
military coups, martial law and political assassinations.

The Filipino population consists of approximately 70 million people,
primarily of Indo-Malay, Chinese and Spanish descent. Thirteen percent
of the population lives within the Metro Manila area. Most Filipinos
are bilingual, with English as the basic language in business,
government, schools, and everyday communication. While there are 87
languages spoken throughout the Philippines, the official language is
Filipino, which is spoken mainly in the Metro Manila area and widely
used in the mass media.

The Philippine economy is basically agricultural if food-processing
manufacture is included. Agriculture (including forestry and fishing)
contributed 21.5% of GDP in 1996, and engaged 39.8% of the employed
labor force, while industry (including mining, manufacturing,
construction and power) contributed 31.9% of GDP and engaged 16.5% of
the employed labor force.

Manufacturing accounted for 22.6% of GDP in 1996 and engaged 9.8% of
the labor force. The principal branches of manufacturing are food
products, petroleum refineries, electrical machinery, chemical
products, beverages, metals and textiles.

The services sector contributed 46.6% of GDP in 1996, and engaged
43.7% of the employed labor force. Remittances from Filipino workers
abroad constituted the Government's principal source of foreign
exchange, while tourism remains a significant sector of the economy.

In 1995 the Philippines recorded a trade deficit and a deficit on the
current account of the balance of payments. The principal source of
imports was Japan, which accounted for 22.1% of the total. Other
significant suppliers were the United States, Saudi Arabia, Singapore,
the Republic of Korea and Taiwan. The United States was the principal
market for exports (35.8%), while other purchasers were Japan,
Singapore and the United Kingdom.

Under the regime of General Fidel Ramos, installed in 1992, the
economic performance of the Philippines improved dramatically, owing
to extensive structural reforms, including the dismantling of
protectionist legislation and the liberalization of trade, foreign
investment and foreign exchange controls. However, economic growth was
adversely affected by the regional financial crisis in 1997. The
effective devaluation of the peso in July caused a collapse of the
stock market and led to rising inflation and the depletion of foreign
exchange reserves. The absence of large foreign investment inflows,
which had previously contributed to an overall surplus on the balance
of payments despite a recurrent account deficit, resulted in an
overall deficit in 1997.

The Philippine stock exchange (PSE) is the country's only exchange
and ranks thirty-sixth in total market capitalization among the
world's markets. The total number of companies listed on the exchange
was 221 in 1997. Individual domestic investors are the majority
participants while foreign investment is dominated by the Taiwanese,
who are closely followed by the Japanese and Hong Kong Chinese.
Foreign investors are generally allowed to acquire 100% of the equity
of a Philippine listed company, although there are businesses where
foreign ownership is restricted by law.

Foreign investors face special risks when investing in the
Philippines. The country's economy and stock market have historically
been highly sensitive to changes in the Asian region's economies and
this has been amply demonstrated in recent years. After posting
dramatic gains in the four years preceding Asia's financial crisis in
mid-1997, the Philippine stock market plummeted in response to the
spreading economic, political turmoil in Southeast Asia and Japan. The
market's weakness was further exacerbated as foreign investors pulled
out of the market in large numbers.

Weakening conditions in neighboring countries has also negatively
impacted the Philippine peso. Plummeting currencies in Thailand,
Indonesia, Singapore and Malaysia sent the Philippine peso into a
steady decline. Over the 1997 calendar year, the value of the peso
fell by 52 percent versus the U.S. dollar.

For U.S. investors, currency fluctuation presents an additional risk
to investing in the Philippines as a weakening peso can erode the
investment returns on their investments in that country.

Because the Philippines is highly dependent upon the United States,
Japan and the Southeast Asian countries as the primary purchasers of
its exports, its economy is particularly sensitive to changes in the
economic fortunes of these nations.

Although the Philippine political climate appears to have improved
over the past few years, investors should be aware that the country
has periodically been subjected to military coups, martial law, and
widespread political corruption since it gained independence. Several
past administrations have instituted policies that have also been
detrimental to the domestic economy and the rights of its citizens.
Cronyism and corruption have also been rampant in both government and
the business community to the detriment of the interests of corporate
shareholders.

PAKISTAN. The Islamic Republic of Pakistan was founded in 1947, when
the British partitioned the South Asian subcontinent into two states:
India and Pakistan. (East Pakistan broke away to become Bangladesh in
1971). The Pakistan constitution of 1973, amended substantially in
1985, provides for a President (Chief of State) who is elected by an
electoral college consisting of both houses of the federal parliament
and members of the four provincial legislatures. The National Assembly
in a special session elects a Prime Minister. Following the election,
the President invites the Prime Minister to create a government. The
constitution permits a vote of "no confidence" against the Prime
Minister by a majority of the National Assembly. In practice, the army
has a strong voice in the decision-making process and few Presidents
have been able to oppose its interests for long.

Relations between Pakistan and India have been fraught with
difficulties. India disputes Pakistan's claims to part of Kashmir, and
repeated attempts at mediation have not resolved this conflict. The
dispute has triggered wars between the two countries in 1947, 1965 and
1971. India has accused Pakistan of fomenting religious and political
unrest and in 1994 there were frequent disturbances in the region. The
two sides frequently exchange gunfire. More recently, India's nuclear
tests prompted Pakistan to reply in kind, despite Western efforts to
dissuade it. Economic sanctions imposed by the U.S. and other
industrialized countries following the nuclear tests have not been
without consequences. While their short-term, direct effect on the
economy has been relatively modest, the indirect and medium-term
consequences of sanctions could become more serious as the resumption
of IMF funding is currently in jeopardy.

With a per capita GDP of about $470, Pakistan is considered a
low-income country by the World Bank. No more than 39% of adults are
literate and life expectancy at birth is about 62 years. Relatively
few resources have been devoted to socio-economic development or
infrastructure projects. Inadequate provision of social services and
high population growth have contributed to a persistence of poverty
and unequal income distribution.

The country's principal natural resource is arable land (25% of the
total land area is under cultivation). Agriculture accounts for 24% of
GDP and employs about 50% of the labor force. Wheat, cotton, and rice
together account for almost 70% of the value of total crop output and
are among the country's major exports. Pakistan's manufacturing sector
accounts for about 20% of GDP. Cotton textile production and apparel
manufacturing are Pakistan's largest industries, accounting for about
50% of total exports. Other major industries include cement,
fertilizer, sugar, steel, tobacco, chemicals, machinery and food
processing.

Weak world demand for its exports and domestic political uncertainty
have contributed to the nation's widening trade deficit. The nation
continues to rely heavily on imports of such materials as petroleum
products, capital goods, industrial raw materials and consumer
products and the resulting external imbalance has left Pakistan with a
growing foreign debt burden. Annual debt service now exceeds 27% of
export earnings.

Pakistan has three stock exchanges located in Karachi, Lahore and
Islamabad. The Karachi Stock Exchange (KSE) is dominant, accounting
for approximately 80% of equity transactions in Pakistan. The KSE
ranks forty-eighth among the world's markets and had a market
capitalization of $11 billion in 1997. At the end of that year there
were 781 companies listed on the KSE. The combined market
capitalization of the 20 largest companies represented 71.7% of the
market total.

U.S. investors should be aware that there are a number of factors
that could pose special risks to investing in Pakistan securities.
Among these is the country's long history of government instability
marked by military coups, political assassinations and frequent
outbreaks of violent rioting, strikes and ethnic unrest. While recent
governments have made some progress on addressing some of the
country's social and economic ills, the current administration is
faced with a number of serious crises. The country appears to be close
to defaulting on its international commitments. With no debt
repayments made since August of 1998, Pakistan faces the possibility
of outright default unless it can secure a bailout package and debt
rescheduling. Recent talks with the IMF on a debt rescue package broke
down and a default could precipitate declines in the nation's trade
and currency. By November of 1998, foreign investment had slowed
dramatically in response to a rise in investment risk and new
restrictions imposed by the central bank designed to limit the outflow
of foreign exchange.

Corruption within the government and business community remains a
problem and corporate managers are generally not focused on improving
shareholder interests.

The threat of war with India over the disputed province of Kashmir
remains a threat to peace in the region and any outbreak of
hostilities would likely plunge the nation's economy into deep
depression and further erode the relative value of its currency versus
the world's major currencies.

PORTFOLIO TRANSACTIONS

All orders for the purchase or sale of portfolio securities (normally,
shares of the underlying Fidelity funds) are placed on behalf of
Four-in-One Index by Strategic Advisers, either itself or through its
affiliates, pursuant to authority contained in Four-in-One Index's
management contract. Four-in-One Index will not incur any commissions
or sales charges when it invests in underlying Fidelity funds, but it
may incur such costs if it invests directly in other types of
securities.

All orders for the purchase or sale of portfolio securities are placed
on behalf of each underlying Fidelity Stock Index Fund by BT pursuant
to authority contained in each underlying Fidelity Stock Index Fund's
management contract and sub-advisory agreement.

All orders for the purchase or sale of portfolio securities are placed
on behalf of Fidelity U.S. Bond Index Fund by FMR pursuant to
authority contained in Fidelity U.S. Bond Index Fund's management
contract. If FMR grants investment management authority to Fidelity
U.S. Bond Index Fund's sub-adviser, the sub-adviser is authorized to
place orders for the purchase and sale of portfolio securities on
behalf of that fund, and will do so in accordance with the policies
described below.

Strategic Advisers, FMR and BT, as applicable, each is also
responsible for the placement of transaction orders for other
investment companies and investment accounts for which it or its
affiliates act as investment adviser. In selecting broker-dealers,
subject to applicable limitations of the federal securities laws,
Strategic Advisers, FMR and BT consider various relevant factors,
including, but not limited to: the size and type of the transaction;
the nature and character of the markets for the security to be
purchased or sold; the execution efficiency, settlement capability,
and financial condition of the broker-dealer firm; the broker-dealer's
execution services rendered on a continuing basis; the reasonableness
of any commissions; and, in selecting broker-dealers to place
portfolio transactions for certain underlying Fidelity funds,
arrangements for payment of fund expenses.

Generally, commissions for investments traded on foreign exchanges
will be higher than for investments traded on U.S. exchanges and may
not be subject to negotiation.

Four-in-One Index and underlying Fidelity funds may execute portfolio
transactions with broker-dealers who provide research and execution
services to the funds or other investment accounts over which
Strategic Advisers, FMR, BT, or their affiliates exercise investment
discretion. Such services may include advice concerning the value of
securities; the advisability of investing in, purchasing, or selling
securities; and the availability of securities or the purchasers or
sellers of securities. In addition, such broker-dealers may furnish
analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy, and performance of
investment accounts; and effect securities transactions and perform
functions incidental thereto (such as clearance and settlement).

The selection of such broker-dealers for transactions in equity
securities on behalf of Fidelity U.S. Bond Index Fund is generally
made by FMR (to the extent possible consistent with execution
considerations) in accordance with a ranking of broker-dealers
determined periodically by FMR's investment staff based upon the
quality of research and execution services provided.

The selection of such broker-dealers for transactions in equity
securities on behalf of the underlying Fidelity Stock Index Funds is
generally made by BT (to the extent possible consistent with execution
considerations) in accordance with a ranking of broker-dealers
determined periodically by BT's investment staff based primarily upon
the quality of execution services provided.

For transactions in fixed-income securities on behalf of Four-in-One
Index or Fidelity U.S. Bond Index Fund, Strategic Adviser's or FMR's
selection of broker-dealers is generally based on the availability of
a security and its price and, to a lesser extent, on the overall
quality of execution and other services, including research, provided
by the broker-dealer.

For transactions in fixed-income securities on behalf of the
underlying Fidelity Stock Index Funds, FMR's or BT's selection of
broker-dealers is generally based on the availability of a security
and its price and, to a lesser extent, on the overall quality of
execution and other services, provided by the broker-dealer.

The receipt of research from broker-dealers that execute transactions
on behalf of Four-in-One Index or an underlying Fidelity fund may be
useful to Strategic Advisers, FMR or BT, as the case may be, in
rendering investment management services to that fund or its other
clients, and conversely, such research provided by broker-dealers who
have executed transaction orders on behalf of other Strategic
Advisers, FMR or BT clients may be useful to Strategic Advisers, FMR
or BT, as the case may be, in carrying out its obligations to a fund.
The receipt of such research has not reduced Strategic Advisers',
FMR's or BT's normal independent research activities; however, it
enables Strategic Advisers, FMR and BT to avoid the additional
expenses that could be incurred if Strategic Advisers, FMR or BT tried
to develop comparable information through its own efforts.

Fixed-income securities are generally purchased from an issuer or
underwriter acting as principal for the securities, on a net basis
with no brokerage commission paid. However, the dealer is compensated
by a difference between the security's original purchase price and the
selling price, the so-called "bid-asked spread." Securities may also
be purchased from underwriters at prices that include underwriting
fees.

Subject to applicable limitations of the federal securities laws, a
fund may pay a broker-dealer commissions for agency transactions that
are in excess of the amount of commissions charged by other
broker-dealers in recognition of their research and execution
services. In order to cause the fund to pay such higher commissions,
FMR or BT, as applicable, must determine in good faith that such
commissions are reasonable in relation to the value of the brokerage
and research services provided by such executing broker-dealers,
viewed in terms of a particular transaction or FMR's or BT's overall
responsibilities to that fund or its other clients. In reaching this
determination, FMR or BT, as applicable, will not attempt to place a
specific dollar value on the brokerage and research services provided,
or to determine what portion of the compensation should be related to
those services.

To the extent permitted by applicable law, Strategic Advisers, FMR and
BT, as applicable, are authorized to allocate portfolio transactions
in a manner that takes into account assistance received in the
distribution of shares of the funds or other Fidelity funds and to use
the research services of brokerage and other firms that have provided
such assistance. Strategic Advisers and FMR may use research services
provided by and place agency transactions with National Financial
Services Corporation (NFSC) and Fidelity Brokerage Services Japan LLC
(FBSJ), indirect subsidiaries of FMR Corp., if the commissions are
fair, reasonable, and comparable to commissions charged by
non-affiliated, qualified brokerage firms for similar services. BT may
use research services provided by and place agency transactions with
National Financial Services Corporation (NFSC) and Fidelity Brokerage
Services Japan LLC (FBSJ), indirect subsidiaries of FMR Corp., and BT
Brokerage Corporation and BT Futures Corp., indirect subsidiaries of
Bankers Trust Corporation, if the commissions are fair, reasonable,
and comparable to commissions charged by non-affiliated, qualified
brokerage firms for similar services. Prior to December 9, 1997, FMR
and Strategic Advisers used research services provided by and placed
agency transactions with Fidelity Brokerage Services (FBS), an
indirect subsidiary of FMR Corp.

FMR may allocate brokerage transactions to broker-dealers (including
affiliates of FMR) who have entered into arrangements with FMR under
which the broker-dealer allocates a portion of the commissions paid by
an underlying Fidelity fund toward the reduction of that fund's
expenses. The transaction quality must, however, be comparable to
those of other qualified broker-dealers.

Section 11(a) of the Securities Exchange Act of 1934 prohibits members
of national securities exchanges from executing exchange transactions
for investment accounts which they or their affiliates manage, unless
certain requirements are satisfied. Pursuant to such requirements, the
Board of Trustees has authorized NFSC to execute portfolio
transactions on national securities exchanges in accordance with
approved procedures and applicable SEC rules.

The Trustees of the fund periodically review Strategic Advisers',
FMR's, or BT's performance of its responsibilities in connection with
the placement of portfolio transactions on behalf of Four-in-One Index
or the underlying Fidelity funds, respectively, and review the
commissions paid by the fund over representative periods of time to
determine if they are reasonable in relation to the benefits to the
fund.

The Trustees of the fund have approved procedures in conformity with
Rule 10f-3 under the 1940 Act whereby a fund may purchase securities
that are offered in underwritings in which an affiliate of FMR
participates. These procedures prohibit the fund from directly or
indirectly benefiting an FMR affiliate in connection with such
underwritings. In addition, for underwritings where an FMR affiliate
participates as a principal underwriter, certain restrictions may
apply that could, among other things, limit the amount of securities
that the fund could purchase in the underwriting.

From time to time the Trustees will review whether the recapture for
the benefit of Four-in-One Index or the underlying Fidelity funds of
some portion of the brokerage commissions or similar fees paid by the
funds on portfolio transactions is legally permissible and advisable.
Each fund seeks to recapture soliciting broker-dealer fees on the
tender of portfolio securities, but at present no other recapture
arrangements are in effect. The Trustees intend to continue to review
whether recapture opportunities are available and are legally
permissible and, if so, to determine in the exercise of their business
judgment whether it would be advisable for each fund to seek such
recapture.

Although the Trustees and officers of Four-in-One Index are
substantially the same as those of the underlying Fidelity funds and
other funds managed by FMR or its affiliates, investment decisions for
Four-in-One Index are made independently from those of other funds
managed by FMR or investment accounts managed by FMR affiliates. It
sometimes happens that the same security is held in the portfolio of
more than one of these funds or investment accounts. Simultaneous
transactions are inevitable when several funds and investment accounts
are managed by the same investment adviser, or an affiliate thereof,
particularly when the same security is suitable for the investment
objective of more than one fund or investment account.

When two or more of Four-in-One Index and/or underlying Fidelity funds
are simultaneously engaged in the purchase or sale of the same
security, the prices and amounts are allocated in accordance with
procedures believed to be appropriate and equitable for each fund. In
some cases this system could have a detrimental effect on the price or
value of the security as far as each fund is concerned. In other
cases, however, the ability of the funds to participate in volume
transactions will produce better executions and prices for the funds.
It is the current opinion of the Trustees that the desirability of
retaining Strategic Advisers or FMR as investment adviser to
Four-in-One Index and each underlying Fidelity fund, as applicable,
and BT as sub-adviser to each underlying Stock Index Fund, outweighs
any disadvantages that may be said to exist from exposure to
simultaneous transactions.

VALUATION

The fund's net asset value per share (NAV) is the value of a single
share. The NAV of the fund is computed by adding the value of the
fund's investments, cash, and other assets, subtracting its
liabilities, and dividing the result by the number of shares
outstanding.

The assets of Four-in-One Index consist primarily of shares of the
underlying Fidelity funds, which are valued at their respective NAVs.

VALUATION OF UNDERLYING FIDELITY FUNDS

GROWTH FUNDS. Portfolio securities are valued by various methods
depending on the primary market or exchange on which they trade. Most
equity securities for which the primary market is the United States
are valued at last sale price or, if no sale has occurred, at the
closing bid price. Most equity securities for which the primary market
is outside the United States are valued using the official closing
price or the last sale price in the principal market in which they are
traded. If the last sale price (on the local exchange) is unavailable,
the last evaluated quote or closing bid price normally is used.
Securities of other open-end investment companies are valued at their
respective NAVs.

Fixed-income securities and other assets for which market quotations
are readily available may be valued at market values determined by
such securities' most recent bid prices (sales prices if the principal
market is an exchange) in the principal market in which they normally
are traded, as furnished by recognized dealers in such securities or
assets. Or, fixed-income securities and convertible securities may be
valued on the basis of information furnished by a pricing service that
uses a valuation matrix which incorporates both dealer-supplied
valuations and electronic data processing techniques. Use of pricing
services has been approved by the Board of Trustees. A number of
pricing services are available, and the funds may use various pricing
services or discontinue the use of any pricing service.

Futures contracts and options are valued on the basis of market
quotations, if available.

Independent brokers or quotation services provide prices of foreign
securities in their local currency. Fidelity Service Company, Inc.
(FSC) gathers all exchange rates daily at the close of the New York
Stock Exchange (NYSE) using the last quoted price on the local
currency and then translates the value of foreign securities from
their local currencies into U.S. dollars. Any changes in the value of
forward contracts due to exchange rate fluctuations and days to
maturity are included in the calculation of NAV. If an event that is
expected to materially affect the value of a portfolio security occurs
after the close of an exchange or market on which that security is
traded, then that security will be valued in good faith by a committee
appointed by the Board of Trustees.

Short-term securities with remaining maturities of sixty days or less
for which market quotations and information furnished by a pricing
service are not readily available are valued either at amortized cost
or at original cost plus accrued interest, both of which approximate
current value.

The procedures set forth above need not be used to determine the value
of the securities owned by a fund if, in the opinion of a committee
appointed by the Board of Trustees, some other method would more
accurately reflect the fair value of such securities. For example,
securities and other assets for which there is no readily available
market value may be valued in good faith by a committee appointed by
the Board of Trustees. In making a good faith determination of the
value of a security, the committee may review price movements in
futures contracts and ADRs, market and trading trends, the bid/ask
quotes of brokers and off-exchange institutional trading.

TAXABLE BOND FUND. Portfolio securities are valued by various methods
depending on the primary market or exchange on which they trade.
Fixed-income securities and other assets for which market quotations
are readily available may be valued at market values determined by
such securities' most recent bid prices (sales prices if the principal
market is an exchange) in the principal market in which they normally
are traded, as furnished by recognized dealers in such securities or
assets.

Or, fixed-income securities and convertible securities may be valued
on the basis of information furnished by a pricing service that uses a
valuation matrix which incorporates both dealer-supplied valuations
and electronic data processing techniques. Use of pricing services has
been approved by the Board of Trustees. A number of pricing services
are available, and the fund may use various pricing services or
discontinue the use of any pricing service.

Futures contracts and options are valued on the basis of market
quotations, if available. Securities of other open-end investment
companies are valued at their respective NAVs.

Independent brokers or quotation services provide prices of foreign
securities in their local currency. FSC gathers all exchange rates
daily at the close of the NYSE using the last quoted price on the
local currency and then translates the value of foreign securities
from their local currencies into U.S. dollars. Any changes in the
value of forward contracts due to exchange rate fluctuations and days
to maturity are included in the calculation of NAV. If an event that
is expected to materially affect the value of a portfolio security
occurs after the close of an exchange or market on which that security
is traded, then that security will be valued in good faith by a
committee appointed by the Board of Trustees.

The procedures set forth above need not be used to determine the value
of the securities owned by the fund if, in the opinion of a committee
appointed by the Board of Trustees, some other method would more
accurately reflect the fair value of such securities. For example,
securities and other assets for which there is no readily available
market value may be valued in good faith by a committee appointed by
the Board of Trustees. In making a good faith determination of the
value of a security, the committee may review price movements in
futures contracts and ADRs, market and trading trends, the bid/ask
quotes of brokers and off-exchange institutional trading.

PERFORMANCE

Four-in-One Index and the underlying Fidelity funds may quote
performance in various ways, and Four-in-One Index may quote the
performance of various underlying Fidelity funds. All performance
information supplied by the fund in advertising is historical and is
not intended to indicate future returns. The share price of a bond or
equity fund, the yield of a bond fund, and return fluctuate in
response to market conditions and other factors, and the value of an
equity or bond fund's shares when redeemed may be more or less than
their original cost. The following paragraphs describe how yield, as
applicable, and return are calculated by Four-in-One Index and the
underlying Fidelity funds.

YIELD CALCULATIONS (BOND FUND). Yields for the fund are computed by
dividing the fund's interest and and dividend income for a given
30-day or one-month period, net of expenses, by the average number of
shares entitled to receive distributions during the period, dividing
this figure by the fund's NAV at the end of the period, and
annualizing the result (assuming compounding of income) in order to
arrive at an annual percentage rate. Yields do not reflect the fund's
short-term trading fee. Income is calculated for purposes of yield
quotations in accordance with standardized methods applicable to all
stock and bond funds. Dividends from equity investments are treated as
if they were accrued on a daily basis, solely for the purposes of
yield calculations. In general, interest income is reduced with
respect to bonds trading at a premium over their par value by
subtracting a portion of the premium from income on a daily basis, and
is increased with respect to bonds trading at a discount by adding a
portion of the discount to daily income. For the fund's investments
denominated in foreign currencies, income and expenses are calculated
first in their respective currencies, and then are converted to U.S.
dollars, either when they are actually converted or at the end of the
30-day or one month period, whichever is earlier. Capital gains and
losses generally are excluded from the calculation as are gains and
losses from currency exchange rate fluctuations.

Income calculated for the purposes of calculating the fund's yield
differs from income as determined for other accounting purposes.
Because of the different accounting methods used, and because of the
compounding of income assumed in yield calculations, the fund's yield
may not equal its distribution rate, the income paid to your account,
or the income reported in the fund's financial statements.

Yield information may be useful in reviewing the fund's performance
and in providing a basis for comparison with other investment
alternatives. However, the fund's yield fluctuates, unlike investments
that pay a fixed interest rate over a stated period of time. When
comparing investment alternatives, investors should also note the
quality and maturity of the portfolio securities of respective
investment companies they have chosen to consider.

Investors should recognize that in periods of declining interest rates
the fund's yield will tend to be somewhat higher than prevailing
market rates, and in periods of rising interest rates the fund's yield
will tend to be somewhat lower. Also, when interest rates are falling,
the inflow of net new money to the fund from the continuous sale of
its shares will likely be invested in instruments producing lower
yields than the balance of the fund's holdings, thereby reducing the
fund's current yield. In periods of rising interest rates, the
opposite can be expected to occur.

RETURN CALCULATIONS. Returns quoted in advertising reflect all aspects
of a fund's return, including the effect of reinvesting dividends and
capital gain distributions, and any change in a fund's NAV over a
stated period but do not include the effect of Four-in-One Index's and
the Stock Index Funds' annual index account fee. A cumulative return
reflects actual performance over a stated period of time. Average
annual returns are calculated by determining the growth or decline in
value of a hypothetical historical investment in a fund over a stated
period, and then calculating the annually compounded percentage rate
that would have produced the same result if the rate of growth or
decline in value had been constant over the period. For example, a
cumulative return of 100% over ten years would produce an average
annual return of 7.18%, which is the steady annual rate of return that
would equal 100% growth on a compounded basis in ten years. Average
annual returns covering periods of less than one year are calculated
by determining a fund's return for the period, extending that return
for a full year (assuming that return remains constant over the year),
and quoting the result as an annual return. While average annual
returns are a convenient means of comparing investment alternatives,
investors should realize that a fund's performance is not constant
over time, but changes from year to year, and that average annual
returns represent averaged figures as opposed to the actual
year-to-year performance of a fund.

In addition to average annual returns, a fund may quote unaveraged or
cumulative returns reflecting the simple change in value of an
investment over a stated period. Average annual and cumulative returns
may be quoted as a percentage or as a dollar amount, and may be
calculated for a single investment, a series of investments, or a
series of redemptions, over any time period. Returns may be broken
down into their components of income and capital (including capital
gains and changes in share price) in order to illustrate the
relationship of these factors and their contributions to return.
Returns may be quoted on a before-tax or after-tax basis. Returns may
or may not include the effect of a fund's short-term trading fee or
index account fee. Excluding a fund's short-term trading fee or index
account fee from a return calculation produces a higher return figure.
Returns and other performance information may be quoted numerically or
in a table, graph, or similar illustration.

NET ASSET VALUE. Charts and graphs using a fund's NAVs, adjusted NAVs,
and benchmark indexes may be used to exhibit performance. An adjusted
NAV includes any distributions paid by the fund and reflects all
elements of its return. Unless otherwise indicated, a fund's adjusted
NAVs are not adjusted for sales charges, if any.

MOVING AVERAGES. A growth fund may illustrate performance using moving
averages. A long-term moving average is the average of each week's
adjusted closing NAV for a specified period. A short-term moving
average is the average of each day's adjusted closing NAV for a
specified period. Moving Average Activity Indicators combine adjusted
closing NAVs from the last business day of each week with moving
averages for a specified period to produce indicators showing when an
NAV has crossed, stayed above, or stayed below its moving average.

CALCULATING HISTORICAL FUND RESULTS. The following table shows
performance for the underlying funds.

HISTORICAL FUND RESULTS - UNDERLYING FIDELITY FUNDS. The following
table shows the underlying Fidelity funds' 30-day yields, as
applicable, and/or return for the fiscal periods ended February 28,
1999. Returns do not include the effect of a fund's purchase fee or
short-term trading fee.

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Average Annual Returns Cumulative Returns

Thirty-Day Yield One Year Five Years Life of Fund One Year Five Years

Spartan Market Index n/a % % %* % %
Fund(dagger)

Spartan Extended Market Index n/a % % %** % %
Fund(dagger)(dagger)

Spartan International Index n/a % % %** % %
Fund(dagger)(dagger)(dagger)

Fidelity U.S. Bond Index % % % %*** % %

</TABLE>

Cumulative Returns

Life of Fund

Spartan Market Index %*
Fund(dagger)

Spartan Extended Market Index %**
Fund(dagger)(dagger)

Spartan International Index %**
Fund(dagger)(dagger)(dagger)

Fidelity U.S. Bond Index %***

</TABLE>

* From March 6, 1990 (commencement of operations).

** From November 5, 1997 (commencement of operations).

*** From March 8, 1990 (commencement of operations).

(dagger) Total return figures do not include the effect of Spartan
Market Index Fund's 0.50% redemption fee, applicable to shares held
less than 90 days.

(dagger)(dagger) Total return figures do not include the effect of
Spartan Extended Market Index Fund's 0.75% purchase fee.

(dagger)(dagger)(dagger) Total return figures do not include the
effect of Spartan International Index Fund's 1.00% purchase fee.

Note: If FMR had not reimbursed certain underlying Fidelity fund
expenses during these periods, ___'s and ___'s returns would have been
lower.

[Note: If FMR had not reimbursed certain underlying Fidelity fund
expenses during these periods, Fidelity U.S. Bond Index's yield would
have been ___%.]

The performance data relating to the underlying Fidelity funds set
forth above is not indicative of future performance of either the
underlying Fidelity funds or Four-in-One Index.

A fund may compare its return to the record of the S&P 500, the Dow
Jones Industrial Average (DJIA), and the cost of living, as measured
by the Consumer Price Index (CPI), over the same period. The S&P 500
and DJIA comparisons would show how the fund's return compared to the
record of a broad unmanaged index of common stocks and a narrower set
of stocks of major industrial companies, respectively. Each fund has
the ability to invest in securities not included in either index, and
its investment portfolio may or may not be similar in composition to
the indexes. The S&P 500 and DJIA returns are based on the prices of
unmanaged groups of stocks and, unlike a fund's returns, do not
include the effect of brokerage commissions or other costs of
investing.

INDEX RESULTS. The following table shows the record of the S&P 500,
the Wilshire 4500, the MSCI EAFE and the Lehman Brothers Aggregate
Bond Index over the ten year period ended February 28, 1999. The
underlying funds may not always hold the same securities as its
indexes. BT may use statistical sampling techniques to attempt to
replicate the returns of the indexes using a smaller number of
securities. Index values are based on the prices of unmanaged groups
of stocks and, unlike the funds' returns, do not include the effect of
brokerage commissions or other costs of investing.

S&P 500 Wilshire 4500 MSCI EAFE Lehman Brothers Aggregate
Bond Index

1999

1998

1997

1996

1995

1994

1993

1992

1991

1990

PERFORMANCE COMPARISONS. A fund's performance may be compared to the
performance of other mutual funds in general, or to the performance of
particular types of mutual funds. These comparisons may be expressed
as mutual fund rankings prepared by Lipper Analytical Services, Inc.
(Lipper), an independent service located in Summit, New Jersey that
monitors the performance of mutual funds. Generally, Lipper rankings
are based on return, assume reinvestment of distributions, do not take
sales charges or trading fees into consideration, and are prepared
without regard to tax consequences. In addition to the mutual fund
rankings, a fund's performance may be compared to stock, bond, and
money market mutual fund performance indexes prepared by Lipper or
other organizations. When comparing these indexes, it is important to
remember the risk and return characteristics of each type of
investment. For example, while stock mutual funds may offer higher
potential returns, they also carry the highest degree of share price
volatility. Likewise, money market funds may offer greater stability
of principal, but generally do not offer the higher potential returns
available from stock mutual funds.

From time to time, a fund's performance may also be compared to other
mutual funds tracked by financial or business publications and
periodicals. For example, a fund may quote Morningstar, Inc. in its
advertising materials. Morningstar, Inc. is a mutual fund rating
service that rates mutual funds on the basis of risk-adjusted
performance. Rankings that compare the performance of Fidelity funds
to one another in appropriate categories over specific periods of time
may also be quoted in advertising.

A fund's performance may also be compared to that of the benchmark
index representing the universe of securities in which the fund may
invest. The return of the index reflects reinvestment of all dividends
and capital gains paid by securities included in the index. Unlike a
fund's returns, however, the index's returns do not reflect brokerage
commissions, transaction fees, or other costs of investing directly in
the securities included in the index.

The performance of Four-in-One Index may be compared to the
performance of the target asset allocation composite index (Composite
Index). Four-in-One Index's Composite Index is a representation of the
performance of the underlying funds (Spartan Market Index Fund,
Spartan Extended Market Index Fund, Spartan International Index Fund
and Fidelity U.S. Bond Index) in which Four-in-One Index is invested
and is based on the weightings of each underlying fund in Four-in-One
Index. The following indexes are used to calculate Four-in-One Index's
Composite Index: S&P 500 for Spartan Market Index Fund, Wilshire 4500
Index for Spartan Extended Market Index Fund, MSCI EAFE for Spartan
International Index Fund, and Lehman Brothers Aggregate Bond Index for
Fidelity U.S. Bond Index. The index weightings for Four-in-One Index
are as follows: S&P 500, 50%; Wilshire 4500, 20%; MSCI EAFE, 15%; and
Lehman Brothers Aggregate Bond Index, 15%.

S&P 500. The Standard & Poor's 500 Index is a market
capitalization-weighted index of common stocks.

WILSHIRE 4500. The Wilshire 4500 is a market capitalization-weighted
index of approximately 6,500 U.S. equity securities.

MSCI EAFE. The EAFE(registered trademark) is a market
capitalization-weighted index that is designed to represent the
performance of developed stock markets outside the United States and
Canada. As of February 28, 1999, the index included over ____ equity
securities of companies domiciled in ___ countries. The index returns
for the EAFE for the periods after January 1, 1997, may be adjusted
for tax withholding rates applicable to U.S.-based mutual funds
organized as Massachusetts business trusts.

LEHMAN BROTHERS AGGREGATE BOND INDEX. The Lehman Brothers Aggregate
Bond Index is a market value-weighted index for investment-grade
fixed-rate debt issues, including government, corporate, asset-backed,
and mortgage-backed securities. Issues included in the index have an
outstanding par value of at least $100 million and maturities of at
least one year. Government and corporate issues include all public
obligations of the U.S. Treasury (excluding flower bonds and
foreign-targeted issues) and U.S. Government agencies, as well as
nonconvertible investment-grade, SEC-registered corporate debt.
Mortgage-backed securities include 15- and 30-year fixed-rate
securities backed by mortgage pools of the Government National
Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation
(FHLMC), and Fannie Mae. Asset-backed securities include credit card,
auto, and home equity loans.

The following table represents the Composite Index's calendar
year-to-year performance. The returns of Four-in-One Index may differ
significantly from those of the Composite Index.

Composite Index

1998

1997

1996

1995

1994

1993

1992

1991

1990

1989

Four-in-One Index may compare its performance to that of the Standard
& Poor's 500 Index.

A fund may be compared in advertising to Certificates of Deposit (CDs)
or other investments issued by banks or other depository institutions.
Mutual funds differ from bank investments in several respects. For
example, a fund may offer greater liquidity or higher potential
returns than CDs, the fund does not guarantee your principal or your
return, and fund shares are not FDIC insured.

Fidelity may provide information designed to help individuals
understand their investment goals and explore various financial
strategies. Such information may include information about current
economic, market, and political conditions; materials that describe
general principles of investing, such as asset allocation,
diversification, risk tolerance, and goal setting; questionnaires
designed to help create a personal financial profile; worksheets used
to project savings needs based on assumed rates of inflation and
hypothetical rates of return; and action plans offering investment
alternatives. Materials may also include discussions of Fidelity's
asset allocation funds and other Fidelity funds, products, and
services.

Ibbotson Associates of Chicago, Illinois (Ibbotson) provides
historical returns of the capital markets in the United States,
including common stocks, small capitalization stocks, long-term
corporate bonds, intermediate-term government bonds, long-term
government bonds, Treasury bills, the U.S. rate of inflation (based on
the CPI), and combinations of various capital markets. The performance
of these capital markets is based on the returns of different indexes.

Fidelity funds may use the performance of these capital markets in
order to demonstrate general risk-versus-reward investment scenarios.
Performance comparisons may also include the value of a hypothetical
investment in any of these capital markets. The risks associated with
the security types in any capital market may or may not correspond
directly to those of the funds. Ibbotson calculates returns in the
same method as the funds. The funds may also compare performance to
that of other compilations or indexes that may be developed and made
available in the future.

In advertising materials, Fidelity may reference or discuss its
products and services, which may include other Fidelity funds;
retirement investing; brokerage products and services; model
portfolios or allocations; saving for college or other goals; and
charitable giving. In addition, Fidelity may quote or reprint
financial or business publications and periodicals as they relate to
current economic and political conditions, fund management, portfolio
composition, investment philosophy, investment techniques, the
desirability of owning a particular mutual fund, and Fidelity services
and products. Fidelity may also reprint, and use as advertising and
sales literature, articles from Fidelity Focus(Registered trademark),
a quarterly magazine provided free of charge to Fidelity fund
shareholders.

A fund may present its fund number, Quotron(trademark) number, and
CUSIP number, and discuss or quote its current portfolio manager.

VOLATILITY. A fund may quote various measures of volatility and
benchmark correlation in advertising. In addition, a fund may compare
these measures to those of other funds. Measures of volatility seek to
compare a fund's historical share price fluctuations or returns to
those of a benchmark. Measures of benchmark correlation indicate how
valid a comparative benchmark may be. All measures of volatility and
correlation are calculated using averages of historical data.

MOMENTUM INDICATORS indicate a fund's price movements over specific
periods of time. Each point on the momentum indicator represents a
fund's percentage change in price movements over that period.

A fund may advertise examples of the effects of periodic investment
plans, including the principle of dollar cost averaging. In such a
program, an investor invests a fixed dollar amount in a fund at
periodic intervals, thereby purchasing fewer shares when prices are
high and more shares when prices are low. While such a strategy does
not assure a profit or guard against loss in a declining market, the
investor's average cost per share can be lower than if fixed numbers
of shares are purchased at the same intervals. In evaluating such a
plan, investors should consider their ability to continue purchasing
shares during periods of low price levels.

A fund may be available for purchase through retirement plans or other
programs offering deferral of, or exemption from, income taxes, which
may produce superior after-tax returns over time. For example, a
$1,000 investment earning a taxable return of 10% annually would have
an after-tax value of $1,949 after ten years, assuming tax was
deducted from the return each year at a 31% rate. An equivalent
tax-deferred investment would have an after-tax value of $2,100 after
ten years, assuming tax was deducted at a 31% rate from the
tax-deferred earnings at the end of the ten-year period.

As of February 28, 1999, FMR advised over $__ billion in municipal
fund assets, $__ billion in taxable fixed-income fund assets, $__
billion in money market fund assets, $___ billion in equity fund
assets, $__ billion in international fund assets, and $___ billion in
Spartan fund assets. The fund may reference the growth and variety of
money market mutual funds and the adviser's innovation and
participation in the industry. The equity funds under management
figure represents the largest amount of equity fund assets under
management by a mutual fund investment adviser in the United States,
making FMR America's leading equity (stock) fund manager. FMR, its
subsidiaries, and affiliates maintain a worldwide information and
communications network for the purpose of researching and managing
investments abroad.

In addition to performance rankings, U.S. Bond Index may compare its
total expense ratio to the average total expense ratio of similar
funds tracked by Lipper. The fund's total expense ratio is a
significant factor in comparing bond and money market investments
because of its effect on yield.

ADDITIONAL PURCHASE, EXCHANGE AND REDEMPTION INFORMATION

If the Trustees determine that existing conditions make cash payments
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are
valued in computing the fund's NAV. Shareholders receiving securities
or other property on redemption may realize a gain or loss for tax
purposes, and will incur any costs of sale, as well as the associated
inconveniences.

DISTRIBUTIONS AND TAXES

DIVIDENDS. A portion of Four-in-One Index's income may qualify for the
dividends-received deduction available to corporate shareholders to
the extent that Four-in-One Index's income is derived from qualifying
dividends or from the qualifying portion of dividends from an
underlying Fidelity fund. For Four-in-One Index and for those
underlying Fidelity funds that may earn other types of income that do
not qualify for the dividends-received deduction available to
corporate shareholders, such as interest, short-term capital gains
(including short-term capital gains distributed by an underlying
Fidelity fund as a dividend as well as short-term capital gains earned
on the sale of underlying Fidelity fund shares or other securities),
and non-qualifying dividends, the percentage of fund dividends that
qualifies for the deduction generally will be less than 100%. A
portion of Four-in-One Index dividends derived from certain U.S.
Government securities, including the portion of dividends from an
underlying Fidelity fund derived from certain U.S. Government
securities, and securities of certain other investment companies may
be exempt from state and local taxation.

CAPITAL GAINS DISTRIBUTIONS. Four-in-One Index's long-term capital
gains distributions, including amounts attributable to an underlying
Fidelity fund's long-term capital gains distributions, are federally
taxable to shareholders generally as capital gains.

RETURNS OF CAPITAL. If the fund's distributions exceed its taxable
income and capital gains realized during a taxable year, all or a
portion of the distributions made in the same taxable year may be
recharacterized as a return of capital to shareholders. A return of
capital distribution will generally not be taxable, but will reduce
each shareholder's cost basis in the fund and result in a higher
reported capital gain or lower reported capital loss when those shares
on which the distribution was received are sold.

TAX STATUS OF THE FUND. Four-in-One Index intends to qualify each year
as a "regulated investment company" under Subchapter M of the Internal
Revenue Code so that it will not be liable for federal tax on income
and capital gains distributed to shareholders. In order to qualify as
a regulated investment company, and avoid being subject to federal
income or excise taxes at the fund level, Four-in-One Index intends to
distribute substantially all of its net investment income and net
realized capital gains within each calendar year as well as on a
fiscal year basis, and intends to comply with other tax rules
applicable to regulated investment companies.

OTHER TAX INFORMATION. The information above is only a summary of some
of the tax consequences generally affecting Four-in-One Index and its
shareholders, and no attempt has been made to discuss individual tax
consequences. It is up to you or your tax preparer to determine
whether the sale of shares of the fund resulted in a capital gain or
loss or other tax consequence to you. In addition to federal income
taxes, shareholders may be subject to state and local taxes on fund
distributions, and shares may be subject to state and local personal
property taxes. Investors should consult their tax advisers to
determine whether Four-in-One Index is suitable to their particular
tax situation.

TRUSTEES AND OFFICERS

The Trustees and executive officers of the trust are listed below. The
Board of Trustees governs Four-in-One Index and is responsible for
protecting the interests of shareholders. The Trustees are experienced
executives who meet periodically throughout the year to oversee
Four-in-One Index's activities, review contractual arrangements with
companies that provide services to Four-in-One Index, and review
Four-in-One Index's performance. Except as indicated, each individual
has held the office shown or other offices in the same company for the
last five years. All persons named as Trustees also serve in similar
capacities for other funds advised by FMR or its affiliates, including
the underlying Fidelity funds. If the interests of Four-in-One Index
and an underlying Fidelity fund were to diverge, a conflict of
interest could arise and affect how the Trustees fulfill their
fiduciary duties to the affected funds. Strategic Advisers has
structured Four-in-One Index to avoid these potential conflicts,
although there may be situations where a conflict of interest is
unavoidable. In such instances, Strategic Advisers and the Trustees
would take reasonable steps to minimize and, if possible, eliminate
the conflict. The business address of each Trustee and officer who is
an "interested person" (as defined in the 1940 Act) is 82 Devonshire
Street, Boston, Massachusetts 02109, which is also the address of FMR.
The business address of all the other Trustees is Fidelity
Investments, P.O. Box 9235, Boston, Massachusetts 02205-9235. Those
Trustees who are "interested persons" by virtue of their affiliation
with the trust, Strategic Advisers, or FMR are indicated by an
asterisk (*).

*EDWARD C. JOHNSON 3d (68), Trustee and President, is Chairman, Chief
Executive Officer and a Director of FMR Corp.; a Director and Chairman
of the Board and of the Executive Committee of FMR; Chairman and a
Director of Fidelity Investments Money Management, Inc. (1998),
Fidelity Management & Research (U.K.) Inc., and Fidelity Management &
Research (Far East) Inc. Abigail Johnson, Member of the Advisory Board
of Fidelity Oxford Street Trust, is Mr. Johnson's daughter.

ABIGAIL P. JOHNSON (37), Member of the Advisory Board of Fidelity
Oxford Street Trust (1999), is Vice President of certain Equity Funds
(1997), and is a Director of FMR Corp. (1994). Before assuming her
current responsibilities, Ms. Johnson managed a number of Fidelity
funds. Edward C. Johnson 3d, Trustee and President of the Funds, is
Ms. Johnson's father.

J. GARY BURKHEAD (57), Member of the Advisory Board (1997), is Vice
Chairman and a Member of the Board of Directors of FMR Corp. (1997)
and President of Fidelity Personal Investments and Brokerage Group
(1997). Previously, Mr. Burkhead served as President of Fidelity
Management & Research Company.

RALPH F. COX (66), Trustee, is President of RABAR Enterprises
(management consulting-engineering industry, 1994). Prior to February
1994, he was President of Greenhill Petroleum Corporation (petroleum
exploration and production). Until March 1990, Mr. Cox was President
and Chief Operating Officer of Union Pacific Resources Company
(exploration and production). He is a Director of USA Waste Services,
Inc. (non-hazardous waste, 1993), CH2M Hill Companies (engineering),
Rio Grande, Inc. (oil and gas production), and Daniel Industries
(petroleum measurement equipment manufacturer). In addition, he is a
member of advisory boards of Texas A&M University and the University
of Texas at Austin.

PHYLLIS BURKE DAVIS (67), Trustee. Prior to her retirement in
September 1991, Mrs. Davis was the Senior Vice President of Corporate
Affairs of Avon Products, Inc. She is currently a Director of
BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores),
and previously served as a Director of Hallmark Cards, Inc.
(1985-1991) and Nabisco Brands, Inc. In addition, she is a member of
the President's Advisory Council of The University of Vermont School
of Business Administration.

ROBERT M. GATES (55), Trustee (1997), is a consultant, author, and
lecturer (1993). Mr. Gates was Director of the Central Intelligence
Agency (CIA) from 1991-1993. From 1989 to 1991, Mr. Gates served as
Assistant to the President of the United States and Deputy National
Security Advisor. Mr. Gates is a Director of LucasVarity PLC
(automotive components and diesel engines), Charles Stark Draper
Laboratory (non-profit), NACCO Industries, Inc. (mining and
manufacturing), and TRW Inc. (original equipment and replacement
products). Mr. Gates also is a Trustee of the Forum for International
Policy and of the Endowment Association of the College of William and
Mary. In addition, he is a member of the National Executive Board of
the Boy Scouts of America.

E. BRADLEY JONES (71), Trustee. Prior to his retirement in 1984, Mr.
Jones was Chairman and Chief Executive Officer of LTV Steel Company.
He is a Director of TRW Inc. (original equipment and replacement
products), Consolidated Rail Corporation, Birmingham Steel
Corporation, and RPM, Inc. (manufacturer of chemical products), and he
previously served as a Director of NACCO Industries, Inc. (mining and
manufacturing, 1985-1995), Hyster-Yale Materials Handling, Inc.
(1985-1995), and Cleveland-Cliffs Inc (mining), and as a Trustee of
First Union Real Estate Investments. In addition, he serves as a
Trustee of the Cleveland Clinic Foundation, where he has also been a
member of the Executive Committee as well as Chairman of the Board and
President, a Trustee and member of the Executive Committee of
University School (Cleveland), and a Trustee of Cleveland Clinic
Florida.

DONALD J. KIRK (66), Trustee, is Executive-in-Residence (1995) at
Columbia University Graduate School of Business and a financial
consultant. From 1987 to January 1995, Mr. Kirk was a Professor at
Columbia University Graduate School of Business. Prior to 1987, he was
Chairman of the Financial Accounting Standards Board. Mr. Kirk
previously served as a Director of General Re Corporation
(reinsurance, 1987-1998) and Valuation Research Corp. (appraisals and
valuations, 1993-1995). He serves as Chairman of the Board of
Directors of National Arts Stabilization Inc., Chairman of the Board
of Trustees of the Greenwich Hospital Association, Director of the
Yale-New Haven Health Services Corp. (1998), a Member of the Public
Oversight Board of the American Institute of Certified Public
Accountants' SEC Practice Section (1995), and as a Public Governor of
the National Association of Securities Dealers, Inc. (1996).

*PETER S. LYNCH (56), Trustee, is Vice Chairman and Director of FMR.
Prior to May 31, 1990, he was a Director of FMR and Executive Vice
President of FMR (a position he held until March 31, 1991); Vice
President of Fidelity Magellan Fund and FMR Growth Group Leader; and
Managing Director of FMR Corp. Mr. Lynch was also Vice President of
Fidelity Investments Corporate Services (1991-1992). In addition, he
serves as a Trustee of Boston College, Massachusetts Eye & Ear
Infirmary, Historic Deerfield (1989) and Society for the Preservation
of New England Antiquities, and as an Overseer of the Museum of Fine
Arts of Boston.

WILLIAM O. McCOY (65), Trustee (1997), is the Vice President of
Finance for the University of North Carolina (16-school system, 1995).
Prior to his retirement in December 1994, Mr. McCoy was Vice Chairman
of the Board of BellSouth Corporation (telecommunications, 1984) and
President of BellSouth Enterprises (1986). He is currently a Director
of Liberty Corporation (holding company, 1984), Weeks Corporation of
Atlanta (real estate, 1994), Carolina Power and Light Company
(electric utility, 1996), and the Kenan Transport Co. (1996).
Previously, he was a Director of First American Corporation (bank
holding company, 1979-1996). In addition, Mr. McCoy serves as a member
of the Board of Visitors for the University of North Carolina at
Chapel Hill (1994) and for the Kenan-Flager Business School
(University of North Carolina at Chapel Hill, 1988).

GERALD C. McDONOUGH (70), Trustee and Chairman of the non-interested
Trustees, is Chairman of G.M. Management Group (strategic advisory
services). Mr. McDonough is a Director of York International Corp.
(air conditioning and refrigeration), Commercial Intertech Corp.
(hydraulic systems, building systems, and metal products, 1992), CUNO,
Inc. (liquid and gas filtration products, 1996), and Associated
Estates Realty Corporation (a real estate investment trust, 1993). Mr.
McDonough served as a Director of ACME-Cleveland Corp. (metal working,
telecommunications, and electronic products) from 1987-1996 and
Brush-Wellman Inc. (metal refining) from 1983-1997.

MARVIN L. MANN (65), Trustee (1993), is Chairman of the Board, of
Lexmark International, Inc. (office machines, 1991). Prior to 1991, he
held the positions of Vice President of International Business
Machines Corporation ("IBM") and President and General Manager of
various IBM divisions and subsidiaries. Mr. Mann is a Director of M.A.
Hanna Company (chemicals, 1993), Imation Corp. (imaging and
information storage, 1997).

*ROBERT C. POZEN (52), Trustee (1997) and Senior Vice President, is
also President and a Director of FMR (1997); and President and a
Director of Fidelity Investments Money Management, Inc. (1998),
Fidelity Management & Research (U.K.) Inc. (1997), and Fidelity
Management & Research (Far East) Inc. (1997). Previously, Mr. Pozen
served as General Counsel, Managing Director, and Senior Vice
President of FMR Corp.

THOMAS R. WILLIAMS (70), Trustee, is President of The Wales Group,
Inc. (management and financial advisory services). Prior to retiring
in 1987, Mr. Williams served as Chairman of the Board of First
Wachovia Corporation (bank holding company), and Chairman and Chief
Executive Officer of The First National Bank of Atlanta and First
Atlanta Corporation (bank holding company). He is currently a Director
of ConAgra, Inc. (agricultural products), Georgia Power Company
(electric utility), National Life Insurance Company of Vermont,
American Software, Inc., and AppleSouth, Inc. (restaurants, 1992).

[REN Y. CHENG (41), Vice President (1999)]

[SCOTT D. STEWART (40), Vice President (1999)]

[ROBERT A. LAWRENCE (46), is Vice President of certain Equity Funds
(1997), Vice President of Fidelity Real Estate High Income Fund (1995)
and Fidelity Real Estate High Income Fund II (1996), and Senior Vice
President of FMR (1993).]

ERIC D. ROITER (50), Secretary (1998), is Vice President (1998) and
General Counsel of FMR (1998). Mr. Roiter was an Adjunct Member,
Faculty of Law, at Columbia University Law School (1996-1997). Prior
to joining Fidelity, Mr. Roiter was a partner at Debevoise & Plimpton
(1981-1997) and served as an Assistant General Counsel of the U.S.
Securities and Exchange Commission (1979-1981).

RICHARD A. SILVER (52), Treasurer (1997), is Treasurer of the Fidelity
funds and is an employee of FMR (1997). Before joining FMR, Mr. Silver
served as Executive Vice President, Fund Accounting & Administration
at First Data Investor Services Group, Inc. (1996-1997). Prior to
1996, Mr. Silver was Senior Vice President and Chief Financial Officer
at The Colonial Group, Inc. Mr. Silver also served as Chairman of the
Accounting/Treasurer's Committee of the Investment Company Institute
(1987-1993).

MATTHEW N. KARSTETTER (37), Deputy Treasurer (1998), is Deputy
Treasurer of the Fidelity funds and is an employee of FMR (1998).
Before joining FMR, Mr. Karstetter served as Vice President of
Investment Accounting and Treasurer of IDS Mutual Funds at American
Express Financial Advisors (1996-1998). Prior to 1996, Mr. Karstetter
was Vice President, Mutual Fund Services at State Street Bank & Trust
(1991-1996).

JOHN H. COSTELLO (52), Assistant Treasurer, is an employee of FMR.

LEONARD M. RUSH (53), Assistant Treasurer (1994), is an employee of
FMR (1994). Prior to becoming Assistant Treasurer of the Fidelity
funds, Mr. Rush was Chief Compliance Officer of FMR Corp. (1993-1994)
and Chief Financial Officer of Fidelity Brokerage Services, Inc.
(1990-1993).

The following table sets forth information describing the compensation
of each Trustee and Member of the Advisory Board of the fund for his
or her services for the fiscal year ended February 28, 1999, or
calendar year ended December 31, 1998, as applicable.

<TABLE>
<CAPTION>
<S> <C> <C>
COMPENSATION TABLE

Trustees and Members of the Aggregate Compensation from Total Compensation from the
Advisory Board Four-in-One Index [B,]C [,+] Fund Complex* A

Edward C. Johnson 3d ** $ $

Abigail P. Johnson ** $ $

J. Gary Burkhead ** $ $

Ralph F. Cox $ $

Phyllis Burke Davis $ $

Robert M. Gates $ $

E. Bradley Jones $ $

Donald J. Kirk $ $

Peter S. Lynch ** $ $

William O. McCoy $ $

Gerald C. McDonough $ $

Marvin L. Mann $ $

Robert C. Pozen** $ $

Thomas R. Williams $ $

</TABLE>

* Information is for the calendar year ended December 31, 1998 for 237
funds in the complex.

** Interested Trustees of the fund, Ms. Johnson and Mr. Burkhead are
compensated by FMR.

+ Estimated

A Compensation figures include cash, amounts required to be deferred,
and may include amounts deferred at the election of Trustees. For the
calendar year ended December 31, 1998, the Trustees accrued required
deferred compensation from the funds as follows: Ralph F. Cox,
$75,000; Phyllis Burke Davis, $75,000; Robert M. Gates, $75,000; E.
Bradley Jones, $75,000; Donald J. Kirk, $75,000; William O. McCoy,
$75,000; Gerald C. McDonough, $87,500; Marvin L. Mann, $75,000; and
Thomas R. Williams, $75,000. Certain of the non-interested Trustees
elected voluntarily to defer a portion of their compensation as
follows: Ralph F. Cox, $55,039; Marvin L. Mann, $55,039; Thomas R.
Williams, $63,433; and William O. McCoy, $55,039.

[B Compensation figures include cash, and may include amounts required
to be deferred and amounts deferred at the election of Trustees.]

[C The following amounts are required to be deferred by each
non-interested Trustee: Ralph F. Cox, $__; Phyllis Burke Davis, $__;
Robert M. Gates, $__; E. Bradley Jones, $__; Donald J. Kirk, $__;
William O. McCoy, $__; Gerald C. McDonough, $__; Marvin L. Mann, $__;
and Thomas R. Williams, $__.]

[F Certain of the non-interested Trustees' aggregate compensation from
the fund includes accrued voluntary deferred compensation as follows:
___, $___.]

Under a deferred compensation plan adopted in September 1995 and
amended in November 1996 (the Plan), non-interested Trustees must
defer receipt of a portion of, and may elect to defer receipt of an
additional portion of, their annual fees. Amounts deferred under the
Plan are subject to vesting and are treated as though equivalent
dollar amounts had been invested in shares of a cross-section of
Fidelity funds including funds in each major investment discipline and
representing a majority of Fidelity's assets under management (the
Reference Funds). The amounts ultimately received by the Trustees
under the Plan will be directly linked to the investment performance
of the Reference Funds. Deferral of fees in accordance with the Plan
will have a negligible effect on a fund's assets, liabilities, and net
income per share, and will not obligate a fund to retain the services
of any Trustee or to pay any particular level of compensation to the
Trustee. A fund may invest in the Reference Funds under the Plan
without shareholder approval.

As of the public offering of shares of the fund, 100% of the fund's
total outstanding shares was held by FMR [and an FMR affiliate]. FMR
Corp. is the ultimate parent company of FMR [and this FMR affiliate].
By virtue of his ownership interest in FMR Corp., as described in the
"Control of Investment Advisers" section on page ___, Mr. Edward C.
Johnson 3d, President and Trustee of the fund, may be deemed to be a
beneficial owner of these shares.

CONTROL OF INVESTMENT ADVISERS

FMR Corp., organized in 1972, is the ultimate parent company of FMR
and Strategic Advisers. The voting common stock of FMR Corp. is
divided into two classes. Class B is held predominantly by members of
the Edward C. Johnson 3d family and is entitled to 49% of the vote on
any matter acted upon by the voting common stock. Class A is held
predominantly by non-Johnson family member employees of FMR Corp. and
its affiliates and is entitled to 51% of the vote on any such matter.
The Johnson family group and all other Class B shareholders have
entered into a shareholders' voting agreement under which all Class B
shares will be voted in accordance with the majority vote of Class B
shares. Under the 1940 Act, control of a company is presumed where one
individual or group of individuals owns more than 25% of the voting
stock of that company. Therefore, through their ownership of voting
common stock and the execution of the shareholders' voting agreement,
members of the Johnson family may be deemed, under the 1940 Act, to
form a controlling group with respect to FMR Corp.

At present, the principal operating activities of FMR Corp. are those
conducted by its division, Fidelity Investments Retail Marketing
Company, which provides marketing services to various companies within
the Fidelity organization.

Fidelity investment personnel may invest in securities for their own
investment accounts pursuant to a code of ethics that sets forth all
employees' fiduciary responsibilities regarding the funds, establishes
procedures for personal investing and restricts certain transactions.
For example, all personal trades in most securities require
pre-clearance, and participation in initial public offerings is
prohibited. In addition, restrictions on the timing of personal
investing in relation to trades by Fidelity funds and on short-term
trading have been adopted.

MANAGEMENT CONTRACT

Four-in-One Index has entered into a management contract with
Strategic Advisers, pursuant to which Strategic Advisors furnishes
investment advisory and other services.

MANAGEMENT SERVICES. Under the terms of its management contract with
the fund, Strategic Advisers acts as investment adviser and, subject
to the supervision of the Board of Trustees, directs the investments
of the fund in accordance with its investment objective, policies and
limitations. Strategic Advisers is authorized, in its discretion, to
allocate the fund's assets among the underlying Fidelity funds in
which the fund may invest. Strategic Advisers also provides the fund
with all necessary office facilities and personnel for servicing the
fund's investments and compensates all personnel of the fund or
Strategic Advisers performing services relating to research,
statistical and investment activities.

Strategic Advisers in turn has entered into an administration
agreement with FMR on behalf of Four-in-One Index. Under the terms of
the administration agreement, FMR or its affiliates provide the
management and administrative services (other than investment advisory
services) necessary for the operation of Four-in-One Index. These
services include providing facilities for maintaining the fund's
organization; supervising relations with custodians, transfer and
pricing agents, accountants, underwriters and other persons dealing
with the fund; preparing all general shareholder communications and
conducting shareholder relations; maintaining the fund's records and
the registration of the fund's shares under federal securities laws
and making necessary filings under state laws; developing management
and shareholder services for the fund; and furnishing reports,
evaluations and analyses on a variety of subjects to the Trustees.

MANAGEMENT-RELATED EXPENSES. Under the terms of Four-in-One Index's
management contract, Strategic Advisers, either itself or through an
affiliate, is responsible for payment of all operating expenses of
Four-in-One Index with certain exceptions. Under the terms of the
administration agreement, FMR pays all management and administrative
expenses (other than investment advisory expenses) for which Strategic
Advisers is responsible. Specific expenses payable by FMR include
expenses for typesetting, printing, and mailing proxy materials to
shareholders, legal expenses, fees of the custodian and auditor, and
the fund's proportionate share of insurance premiums and Investment
Company Institute dues. The administration agreement further provides
that FMR will pay for typesetting, printing, and mailing prospectuses,
statements of additional information, notices, and reports to
shareholders; however, under the terms of Four-in-One Index's transfer
agent agreement, the transfer agent bears the costs of providing these
services to existing shareholders. In addition, FMR compensates all
officers of the fund and all Trustees who are "interested persons" of
the trust, Strategic Advisers, or FMR. FMR also pays all fees
associated with transfer agent, dividend disbursing, and shareholder
services, pricing and bookkeeping services[, and administration of
Four-in-One Index's securities lending program].

Four-in-One Index pays the following expenses: fees and expenses of
the non-interested Trustees, interest on borrowings, taxes, brokerage
commissions (if any), shareholder charges (if any) associated with
investing in the underlying Fidelity funds, and such nonrecurring
expenses as may arise, including costs of any litigation to which a
fund may be a party, and any obligation it may have to indemnify the
officers and Trustees with respect to litigation.

MANAGEMENT FEE. For the services of Strategic Advisers under the
management contract, Four-in-One Index pays Strategic Advisers a
monthly management fee at the annual rate of __% of its average net
assets throughout the month. The management fee paid to Strategic
Advisers by Four-in-One Index is reduced by an amount equal to the
fees and expenses paid by Four-in-One Index to the non-interested
Trustees.

For the services of FMR under the administration agreement, Strategic
Advisers pays FMR a monthly administration fee equal to the monthly
management fee received by Strategic Advisers from Four-in-One Index,
minus an amount equal to an annual rate of __% of that fund's average
net assets throughout the month.

Strategic Advisers may, from time to time, voluntarily reimburse all
or a portion of Four-in-One Index's operating expenses (exclusive of
interest, taxes, brokerage commissions, shareholder charges, and
extraordinary expenses), which is subject to revision or termination.
Strategic Advisers retains the ability to be repaid for these expense
reimbursements in the amount that expenses fall below the limit prior
to the end of the fiscal year.

Expense reimbursements by Strategic Advisers will increase Four-in-One
Index's returns and repayment of the reimbursement by the fund will
lower its returns.

Effective ___ __, ___, Strategic Advisers voluntarily agreed to
reimburse the fund if and to the extent that its aggregate operating
expenses, including management fees, were in excess of an annual rate
of __% of its average net assets.

DISTRIBUTION SERVICES

Four-in-One Index has entered into a distribution agreement with
Fidelity Distributors Corporation (FDC), an affiliate of Strategic
Advisers and FMR. FDC is a broker-dealer registered under the
Securities Exchange Act of 1934 and is a member of the National
Association of Securities Dealers, Inc. The distribution agreement
calls for FDC to use all reasonable efforts, consistent with its other
business, to secure purchasers for shares of the fund, which are
continuously offered at NAV. Promotional and administrative expenses
in connection with the offer and sale of shares are paid by Strategic
Advisers or FMR.

The Trustees have approved a Distribution and Service Plan on behalf
of Four-in-One Index (the Plan) pursuant to Rule 12b-1 under the 1940
Act (the Rule). The Rule provides in substance that a mutual fund may
not engage directly or indirectly in financing any activity that is
primarily intended to result in the sale of shares of the fund except
pursuant to a plan approved on behalf of the fund under the Rule. The
Plan, as approved by the Trustees, allow Four-in-One Index, Strategic
Advisers and FMR to incur certain expenses that might be considered to
constitute indirect payment by the fund of distribution expenses.

Under the Plan, if the payment of management fees by Four-in-One Index
to Strategic Advisers, or the payment of administration fees by
Strategic Advisers to FMR out of the management fees, is deemed to be
indirect financing by the fund of the distribution of its shares, such
payment is authorized by the Plan. The Plan specifically recognizes
that Strategic Advisers or FMR may use its past profits or its other
resources, including management fees paid to Strategic Advisers by the
fund, or administration fees paid to FMR by Strategic Advisers out of
the management fees, to pay FDC for expenses incurred in connection
with providing services intended to result in the sale of Four-in-One
Index shares and/or shareholder support services. In addition, the
Plan provides that Strategic Advisers or FMR, directly or through FDC,
may pay intermediaries, such as banks, broker-dealers and other
service-providers, that provide those services. Currently, the Board
of Trustees has authorized such payments for Four-in-One Index.

Prior to approving the Plan, the Trustees carefully considered all
pertinent factors relating to the implementation of the Plan, and
determined that there is a reasonable likelihood that the Plan will
benefit Four-in-One Index and its shareholders. In particular, the
Trustees noted that the Plan does not authorize payments by
Four-in-One Index other than those made to Strategic Advisers under
its management contract with the fund. To the extent that the Plan
gives Strategic Advisers, FMR and FDC greater flexibility in
connection with the distribution of fund shares, additional sales of
fund shares or stabilization of cash flows may result. Furthermore,
certain shareholder support services may be provided more effectively
under the Plan by local entities with whom shareholders have other
relationships.

The Glass-Steagall Act generally prohibits federally and state
chartered or supervised banks from engaging in the business of
underwriting, selling or distributing securities. Although the scope
of this prohibition under the Glass-Steagall Act has not been clearly
defined by the courts or appropriate regulatory agencies, FDC believes
that the Glass-Steagall Act should not preclude a bank from performing
shareholder support services, or servicing and recordkeeping
functions. FDC intends to engage banks only to perform such functions.
However, changes in federal or state statutes and regulations
pertaining to the permissible activities of banks and their affiliates
or subsidiaries, as well as further judicial or administrative
decisions or interpretations, could prevent a bank from continuing to
perform all or a part of the contemplated services. If a bank were
prohibited from so acting, the Trustees would consider what actions,
if any, would be necessary to continue to provide efficient and
effective shareholder services. In such event, changes in the
operation of the fund might occur, including possible termination of
any automatic investment or redemption or other services then provided
by the bank. It is not expected that shareholders would suffer any
adverse financial consequences as a result of any of these
occurrences. In addition, state securities laws on this issue may
differ from the interpretations of federal law expressed herein, and
banks and other financial institutions may be required to register as
dealers pursuant to state law.

Four-in-One Index may execute portfolio transactions with, and
purchase securities issued by, depository institutions that receive
payments under the Plan. No preference for the instruments of such
depository institutions will be shown in the selection of investments.

TRANSFER AND SERVICE AGENT AGREEMENTS

Four-in-One Index has entered into a transfer agent agreement with
FSC, an affiliate of Strategic Advisers and FMR. Under the terms of
the agreements, FSC performs transfer agency, dividend disbursing, and
shareholder services for Four-in-One Index.

For providing transfer agency services, FSC receives no fees from
Four-in-One Index; however, each underlying Fidelity fund pays its
respective transfer, dividend disbursing, and shareholder servicing
agent (either FSC or an affiliate of FSC) fees based, in part, on the
number of accounts in and assets of Four-in-One Index invested in such
underlying Fidelity fund.

FSC also collects the fund's $10.00 index account fee from certain
accounts with balances of less than $10,000 at the time of the
December distribution.

[In addition, FSC receives the pro rata portion of the transfer agency
fees applicable to shareholder accounts in a qualified state tuition
program (QSTP), as defined under the Small Business Job Protection Act
of 1996, managed by FMR or an affiliate according to the percentage of
the QSTP's assets that is invested in the fund.]

FSC pays out-of-pocket expenses associated with providing transfer
agent services. In addition, FSC bears the expense of typesetting,
printing, and mailing prospectuses, statements of additional
information, and all other reports, notices, and statements to
existing shareholders, with the exception of proxy statements.

Four-in-One Index has also entered into a service agent agreement with
FSC. Under the terms of the agreement, FSC calculates the NAV and
dividends for Four-in-One Index, maintains Four-in-One Index's
portfolio and general accounting records, and administers Four-in-One
Index's securities lending program.

For providing pricing and bookkeeping services, FSC receives a monthly
fee based on Four-in-One Index's average daily net assets throughout
the month.

For administering the fund's securities lending program, FSC receives
fees based on the number and duration of individual securities loans.

FMR bears the cost of pricing and bookkeeping services and
administration of the securities lending program under the terms of
its administration agreement with Strategic Advisers.

DESCRIPTION OF THE FUND

TRUST ORGANIZATION. Fidelity Four-in-One Index Fund is a fund of
Fidelity Oxford Street Trust, an open-end management investment
company organized as a Delaware business trust on June 20, 1991. On
February 18, 1999, Fidelity Oxford Street Trust changed its name from
Daily Money Fund to Fidelity Oxford Street Trust. On July 14, 1995,
Daily Money Fund changed its name from Daily Money Fund II to Daily
Money Fund. Currently, there is one fund in the trust: Fidelity
Four-in-One Index Fund. The Trustees are permitted to create
additional funds in the trust.

The assets of the trust received for the issue or sale of shares of
each fund and all income, earnings, profits, and proceeds thereof,
subject to the rights of creditors, are allocated to such fund, and
constitute the underlying assets of such fund. The underlying assets
of each fund in the trust shall be charged with the liabilities and
expenses attributable to such fund. Any general expenses of the trust
shall be allocated between or among any one or more of the funds.

SHAREHOLDER LIABILITY. The fund is a business trust organized under
Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some
states, however, may decline to apply Delaware law on this point. The
Trust Instrument contains an express disclaimer of shareholder
liability for the debts, liabilities, obligations, and expenses of the
fund. The Trust Instrument provides that the fund shall not have any
claim against shareholders except for the payment of the purchase
price of shares and requires that each agreement, obligation, or
instrument entered into or executed by the fund or the Trustees
relating to the fund shall include a provision limiting the
obligations created thereby to the fund and its assets.

The Trust Instrument provides for indemnification out of the fund's
property of any shareholder or former shareholder held personally
liable for the obligations of the fund solely by reason of his or her
being or having been a shareholder and not because of his or her acts
or omissions or for some other reason. The Trust Instrument also
provides that the fund shall, upon request, assume the defense of any
claim made against any shareholder for any act or obligation of the
fund and satisfy any judgment thereon. Thus, the risk of a shareholder
incurring financial loss on account of shareholder liability is
limited to circumstances in which Delaware law does not apply, no
contractual limitation of liability was in effect, and the fund is
unable to meet its obligations. Strategic Advisers believes that, in
view of the above, the risk of personal liability to shareholders is
extremely remote.

VOTING RIGHTS. The fund's capital consists of shares of beneficial
interest. As a shareholder, you are entitled to one vote for each
dollar of net asset value you own. The voting rights of shareholders
can be changed only by a shareholder vote. Shares may be voted in the
aggregate by class.

The shares have no preemptive or conversion rights. Shares are fully
paid and nonassessable, except as set forth under the heading
"Shareholder Liability" above.

On matters submitted for consideration by shareholders of any
underlying Fidelity fund, Four-in-One Index will vote its shares in
proportion to the vote of all other holders of shares of that
underlying Fidelity fund or, in certain limited instances, Four-in-One
Index will vote its shares in the manner indicated by a vote of its
shareholders.

The fund may be terminated upon the sale of its assets to another
open-end management investment company or series thereof, or upon
liquidation and distribution of its assets. Generally such
terminations must be approved by a vote of shareholders. In the event
of the dissolution or liquidation of the fund, shareholders are
entitled to receive the underlying assets of the fund available for
distribution.

Under the Trust Instrument, the Trustees may, without shareholder
vote, in order to change the form of organization of the fund cause
the fund to merge or consolidate with one or more trusts,
partnerships, associations, limited liability companies or
corporations, as long as the surviving entity is an open-end
management investment company or is a fund thereof, that will succeed
to or assume the fund's registration statement, or cause the fund to
incorporate under Delaware law.

CUSTODIAN. ____, is custodian of the assets of the fund. The custodian
is responsible for the safekeeping of a fund's assets and the
appointment of any subcustodian banks and clearing agencies. The Chase
Manhattan Bank, headquartered in New York, also may serve as a special
purpose custodian of certain assets in connection with repurchase
agreement transactions.

FMR, its officers and directors, its affiliated companies, and members
of the Board of Trustees may, from time to time, conduct transactions
with various banks, including banks serving as custodians for certain
funds advised by FMR. Transactions that have occurred to date include
mortgages and personal and general business loans. In the judgment of
FMR, the terms and conditions of those transactions were not
influenced by existing or potential custodial or other fund
relationships.

AUDITOR. ____, ___, Boston, Massachusetts serves as independent
accountant for the fund. The auditor examines financial statements for
the fund and provides other audit, tax, and related services.

APPENDIX

ABOUT THE S&P 500. The S&P 500 is a well-known stock market index that
includes common stocks of companies representing a significant portion
of the market value of all common stocks publicly traded in the United
States. Stocks in the S&P 500 are weighted according to their market
capitalization (i.e., the number of shares outstanding multiplied by
the stock's current price), with the __ largest stocks currently
comprising approximately __% of the index's value. The composition of
the S&P 500 is determined by Standard & Poor's and is based on such
factors as the market capitalization and trading activity of each
stock and its adequacy as a representation of stocks in a particular
industry group. Standard & Poor's may change the index's composition
from time to time.

The performance of the S&P 500 is a hypothetical number that does not
take into account brokerage commissions and other costs of investing,
which the fund bears.

Although Standard & Poor's obtains information for inclusion in or for
use in the calculation of the S&P 500 from sources which it considers
reliable, Standard & Poor's does not guarantee the accuracy or the
completeness of the S&P 500 or any data included therein. Standard &
Poor's makes no warranty, express or implied, as to results to be
obtained by the licensee, owners of the fund, or any other person or
entity from the use of the S&P 500 or any data included therein in
connection with the rights licensed hereunder or for any other use.
Standard & Poor's makes no express or implied warranties, and hereby
expressly disclaims all warranties of merchantability or fitness for a
particular purpose with respect to the S&P 500 and any data included
therein.

The following is a list of the 500 stocks comprising the S&P 500 as of
February 28, 1999.

[INSERT UPDATED LIST OF COMPANIES PROVIDED BY STANDARD & POOR'S.]

THE WILSHIRE 4500 EQUITY INDEX (Wilshire 4500) is based on the same
securities on which the Wilshire 5000 Equity Index (Wilshire 5000) is
based, excluding securities that are included in the S&P 500. [The
Wilshire 5000 measures the performance of all equity securities of
U.S. headquartered issuers with readily available price data. Over
7,000 security returns are used to adjust the Wilshire 5000 on the
basis of weighted capitalization.] The S&P 500 includes common stocks
of companies representing a significant portion of the market value of
all common stocks publicly traded in the United States. Although some
of the companies in the Wilshire 4500 have large market
capitalizations, excluding the S&P 500 stocks makes the Wilshire 4500,
on average, more representative of medium-to-small-capitalization
stocks. The composition of the S&P 500 is determined by Standard &
Poor's and is based on such factors as the market capitalization and
trading activity of each stock and its adequacy as a representation of
stocks in a particular industry group. Standard & Poor's may change
the composition of the S&P 500 from time to time.

THE MORGAN STANLEY CAPITAL INTERNATIONAL EUROPE, AUSTRALASIA, FAR EAST
(EAFE) INDEX is an unmanaged, market capitalization-weighted index
that is designed to represent the daily price and total return
performance of common or ordinary shares in developed markets in
Europe, Australia and the Far East. Securities in the index are
selected by Morgan Stanley Capital International (MSCI). To achieve a
proper balance between a high level of tracking, liquidity and
restricted float considerations, MSCI aims to capture 60% of each
country's market capitalization, and to assure that the index reflects
the industry characteristics of each country's overall market, MSCI
aims to capture 60% of the capitalization of each industry group, as
defined by local practice. From the universe of available stocks in
each industry group, stocks are selected up to approximately the 60%
level, subject to liquidity, float and cross-ownership considerations.
In addition to market capitalization, a stock's importance may be
assessed by such measures as sales, net income, and industry output.
Maximization of liquidity is balanced by the consideration of other
factors such as overall industry representation. Liquidity, measured
by trading value as reported by the local exchange, is assessed over
time based on an absolute as well as relative basis. While a
hard-and-fast liquidity yardstick is not utilized, trading values are
monitored to establish a "normal" level across short-term market peaks
and troughs. Maximum float, or the percentage of a company's shares
that are freely tradable, is an important optimization parameter but
not a hard-and-fast rule for stock selection. While some exceptions
are made, index constituents are included at 100% of market
capitalization. A representative sample of large, medium and small
companies is included in the index.

Structural changes due to industry composition or regulations
generally take place every one year to 18 months. These are
implemented on the first business day in March, June, September and
December of each year and are announced at least two weeks in advance.
Companies may be deleted because they have diversified away from their
industry classification, because the industry has evolved in a
different direction from the company's thrust, or because a better
industry representative exists in the form of a new issue or existing
company. New issues generally undergo a "seasoning" period of one year
to 18 months prior to eligibility for inclusion in the index. New
issues due to an initial public offering of significant size that
change a country's market and industry profiles, and generate strong
investor interest likely to assure a high level of liquidity, may be
included in the index immediately. The market capitalization of
constituent companies is weighted on the basis of their full market
value, i.e., without adjustments for "long term holdings" or partial
foreign investment restrictions. To address the issue of restriction
on foreign ownership, an additional series of "Free" indices are
calculated for countries and markets with restrictions on foreign
ownership of shares. While some exceptions apply, the index is
computed using the last transaction price recorded on the dominant
stock exchange in each market. WM/Reuters Closing Spot Rates as of
4:00 p.m. London Time are used for currency conversions. MSCI
calculates the EAFE Index with and without giving effect to dividends
paid by index companies. To reflect the performance impact of
dividends paid by index companies, MSCI also estimates the total
return of the EAFE index by reinvesting one twelfth of the month end
dividend yield at every month end. For periods after January 1, 1997,
the EAFE index returns are adjusted for tax withholding rates
applicable to U.S.-based mutual funds organized as Massachusetts
business trusts. Dividends are deemed to be received on the payment
date while the reinvestment of dividends occurs at the end of the
month in which the payment date falls.

[THE LEHMAN BROTHERS AGGREGATE BOND INDEX ]

FIDELITY, FIDELITY INVESTMENTS & (PYRAMID) DESIGN, SPARTAN AND
FIDELITY FOCUS ARE REGISTERED TRADEMARKS OF FMR CORP.

STRATEGIC ADVISERS IS A SERVICE MARK OF FMR CORP.

THE THIRD PARTY MARKS APPEARING ABOVE ARE THE MARKS OF THEIR
RESPECTIVE OWNERS.

PART C. OTHER INFORMATION

Item 23. Exhibits

(a)(1) Trust Instrument of the Trust dated June 20, 1991, is
incorporated herein by reference to Exhibit 1(a) to
Post-Effective Amendment No. 22.

(2) Certificate of Trust of Daily Money Fund II, dated June 20,
1991, is incorporated herein by reference to Exhibit 1(b) of
Post-Effective Amendment No. 30.

(3) Certificate of Amendment of the Trust Instrument of Daily Money
Fund II to Daily Money Fund, dated July 14, 1991, is
incorporated herein by reference to Exhibit 1(c) to
Post-Effective Amendment No. 30.

(4) Supplement to the Trust Instrument dated February 18, 1999, is
filed herein as Exhibit (a)(4).

(b) Bylaws of the Trust, as amended and dated May 19, 1994, are
incorporated herein by reference to Exhibit 2(a) of Fidelity Union
Street Trust II's (File No. 33-43757) Post-Effective Amendment No.
10.

(d)(1) Form of Management Contract between the Registrant, on behalf
of Fidelity Four-in-One Index Fund, and Strategic Advisers,
Inc. is filed herein as Exhibit (d)(1).

(2) Form of Administration Agreement between Strategic Advisers,
Inc. and Fidelity Management & Research Company for Fidelity
Four-in-One Index Fund is filed herein as Exhibit (d)(2).

(e)(1) Form of General Distribution Agreement between the Registrant,
on behalf of Fidelity Four-in-One Index Fund, and Fidelity
Distributors Corporation is filed herein as Exhibit (e)(1).

(f)(1) Retirement Plan for Non-Interested Person Trustees, Directors
or General Partners, as amended on November 16, 1995, is
incorporated herein by reference to Exhibit 7(a) of Fidelity
Select Portfolio's (File No. 2-69972) Post-Effective Amendment
No. 54.

(2) The Fee Deferral Plan for Non-Interested Persons, Directors,
and Trustees of the Fidelity Funds, effective as of September
14, 1995 and amended through November 14, 1996, is incorporated
herein by reference to Exhibit 7(b) to Post-Effective Amendment
No. 19.

(g) To be filed by subsequent amendment.

(h) Not applicable.

(i) Not applicable.

(j) Not applicable.

(k) Not applicable.

(l) Not applicable.

(m)(1) Form of Distribution and Service Plan pursuant to Rule 12b-1
for Fidelity Four-in-One Index Fund is filed herein as Exhibit
(m)(1).

(n) Not applicable.

(o) Not applicable.

Item 24. Trusts Controlled by or under Common Control with this Trust

The Board of Trustees of the Trust is the same as the board of other
Fidelity funds, each of which has Fidelity Management & Research
Company, or an affiliate, as its investment adviser. In addition, the
officers of the Trust are substantially identical to those of the
other Fidelity funds. Nonetheless, the Trust takes the position that
it is not under common control with other Fidelity funds because the
power residing in the respective boards and officers arises as the
result of an official position with the respective trusts.

Item 25. Indemnification

Pursuant to Del. Code Ann. title 12 (sub-section) 3817, a Delaware
business trust may provide in its governing instrument for the
indemnification of its officers and trustees from and against any and
all claims and demands whatsoever. Article X, Section 10.02 of the
Trust Instrument sets forth the reasonable and fair means for
determining whether indemnification shall be provided to any past or
present Trustee or officer. It states that the Trust shall indemnify
any present or past trustee or officer to the fullest extent permitted
by law against liability, and all expenses reasonably incurred by him
or her in connection with any claim, action, suit or proceeding in
which he or she is involved by virtue of his or her service as a
trustee or officer and against any amount incurred in settlement
thereof. Indemnification will not be provided to a person adjudged by
a court or other adjudicatory body to be liable to the Trust or its
shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of his or her duties (collectively,
"disabling conduct"), or not to have acted in good faith in the
reasonable belief that his or her action was in the best interest of
the Trust. In the event of a settlement, no indemnification may be
provided unless there has been a determination, as specified in the
Trust Instrument, that the officer or trustee did not engage in
disabling conduct.

Pursuant to Section 11 of the Distribution Agreement, the Trust
agrees to indemnify and hold harmless the Distributor and each of its
directors and officers and each person, if any, who controls the
Distributor within the meaning of Section 15 of the 1933 Act against
any loss, liability, claim, damages or expense (including the
reasonable cost of investigating or defending any alleged loss,
liability, claim, damages, or expense and reasonable counsel fees
incurred in connection therewith) arising by reason of any person
acquiring any shares, based upon the ground that the registration
statement, Prospectus, Statement of Additional Information,
shareholder reports or other information filed or made public by the
Trust (as from time to time amended) included an untrue statement of a
material fact or omitted to state a material fact required to be
stated or necessary in order to make the statements not misleading
under the 1933 Act, or any other statute or the common law. However,
the Trust does not agree to indemnify the Distributor or hold it
harmless to the extent that the statement or omission was made in
reliance upon, and in conformity with, information furnished to the
Trust by or on behalf of the Distributor. In no case is the indemnity
of the Trust in favor of the Distributor or any person indemnified to
be deemed to protect the Distributor or any person against any
liability to the Issuer or its security holders to which the
Distributor or such person would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance
of its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement.

Pursuant to the agreement by which Fidelity Service Company, Inc.
("FSC") is appointed transfer agent, the Trust agrees to indemnify and
hold FSC harmless against any losses, claims, damages, liabilities or
expenses (including reasonable counsel fees and expenses) resulting
from:

(1) any claim, demand, action or suit brought by any person other
than the Trust, including by a shareholder, which names FSC and/or the
Trust as a party and is not based on and does not result from FSC's
willful misfeasance, bad faith or negligence or reckless disregard of
duties, and arises out of or in connection with FSC's performance
under the Transfer Agency Agreement; or

(2) any claim, demand, action or suit (except to the extent
contributed to by FSC's willful misfeasance, bad faith or negligence
or reckless disregard of its duties) which results from the negligence
of the Trust, or from FSC's acting upon any instruction(s) reasonably
believed by it to have been executed or communicated by any person
duly authorized by the Trust, or as a result of FSC's acting in
reliance upon advice reasonably believed by FSC to have been given by
counsel for the Trust, or as a result of FSC's acting in reliance upon
any instrument or stock certificate reasonably believed by it to have
been genuine and signed, countersigned or executed by the proper
person.

Item 26. Business and Other Connections of Investment Advisers

(1) STRATEGIC ADVISERS, INC.
82 Devonshire Street, Boston, MA 02109

Strategic Advisers, Inc. serves as investment adviser to the Fidelity
Freedom Funds and provides investment supervisory services to
individuals, banks, thrifts, pension and profit sharing plans, trusts,
estates, charitable organizations, corporations, and other business
organizations, and provides a variety of publications on investment
and personal finance. The directors and officers of Strategic
Advisers have held, during the past two fiscal years, the following
positions of a substantial nature.

Roger T. Servison President and Director of
Strategic Advisers, Inc.;
Director of Fidelity
Brokerage Services, Inc.

James C. Curvey Chairman of the Board and
Director of Strategic
Advisers, Inc.; Chief
Operating Officer, Director
and Senior Vice Chairman FMR
Corp.

Lynn Davis Vice President of Portfolio
Advisory Services of
Strategic Advisers, Inc.

Donald Alhart Vice President of Crosby
Advisors of Strategic
Advisers, Inc.

Amy F. Barnwell Vice President of Charitable
Advisory Services of
Strategic Advisers, Inc.

Stephen G. Manning Treasurer of Strategic
Advisers, Inc.; Vice
President and Treasurer of
FMR Corp.; Assistant
Treasurer of Fidelity
Management & Research
Company (FMR), Fidelity
Investments Money
Management, Inc. (FIMM),
Fidelity Management &
Research (U.K.) Inc. (FMR
U.K.), and Fidelity
Management & Research (Far
East) Inc. (FMR Far East).

Gary Greenstein Assistant Treasurer of
Strategic Advisers, Inc.;
Vice President of Taxation
for FMR Corp.

Linda C. Holland Compliance Officer of
Strategic Advisers, Inc.

Jay Freedman Clerk of Strategic Advisers,
Inc.; Associate General
Counsel FMR Corp.; Assistant
Clerk of FMR Corp., FMR
U.K., and FMR Far East;
Secretary of FIMM.

Susan Shields Assistant Clerk of Strategic
Advisers, Inc.

Page Pennell Assistant Clerk of Strategic
Advisers, Inc.

Item 27. Principal Underwriters

(a) Fidelity Distributors Corporation (FDC) acts as distributor for
all funds advised by FMR or an affiliate.
(b)

Name and Principal Positions and Offices Positions and Offices

Business Address* with Underwriter with Fund

Edward C. Johnson 3d Director Trustee and President

Michael Mlinac Director None

James Curvey Director None

Martha B. Willis President None

Eric D. Roiter Vice President Secretary

Caron Ketchum Treasurer and Controller None

Gary Greenstein Assistant Treasurer None

Jay Freedman Assistant Clerk None

Linda Holland Compliance Officer None

* 82 Devonshire Street, Boston, MA

Item 28. Location of Accounts and Records

All accounts, books, and other documents required to be maintained by
Section 31(a) of the 1940 Act and the Rules promulgated thereunder are
maintained by Fidelity Management & Research Company, Fidelity Service
Company, Inc. or Fidelity Investments Institutional Operations
Company, Inc., 82 Devonshire Street, Boston, MA 02109, or the funds'
custodian, The Bank of New York, 110 Washington Street, New York, NY.

Item 29. Management Services

Not applicable.

Item 30. Undertakings

Not applicable.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this
Post-Effective Amendment No. 46 to the Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Boston, and Commonwealth of Massachusetts, on the 7th day
of April 1999.

FIDELITY OXFORD STREET TRUST

By /s/Edward C. Johnson 3d (dagger)
Edward C. Johnson 3d, President

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons
in the capacities and on the dates indicated.

(Signature) (Title) (Date)

/s/Edward C. Johnson 3d President and Trustee April 7, 1999
(dagger)

Edward C. Johnson 3d (Principal Executive Officer)

/s/Richard A. Silver Treasurer April 7, 1999

Richard A. Silver

/s/Robert C. Pozen Trustee April 7, 1999

Robert C. Pozen

/s/Ralph F. Cox Trustee April 7, 1999
*

Ralph F. Cox

/s/Phyllis Burke Davis Trustee April 7, 1999
*

Phyllis Burke Davis

/s/Robert M. Gates Trustee April 7, 1999
**

Robert M. Gates

/s/E. Bradley Jones Trustee April 7, 1999
*

E. Bradley Jones

/s/Donald J. Kirk Trustee April 7, 1999
*

Donald J. Kirk

/s/Peter S. Lynch Trustee April 7, 1999
*

Peter S. Lynch

/s/Marvin L. Mann Trustee April 7, 1999
*

Marvin L. Mann

/s/William O. McCoy Trustee April 7, 1999
*

William O. McCoy

/s/Gerald C. McDonough Trustee April 7, 1999
*

Gerald C. McDonough

/s/Thomas R. Williams Trustee April 7, 1999
*

Thomas R. Williams

(dagger) Signatures affixed by Robert C. Pozen pursuant to a power of
attorney dated July 17, 1997 and filed herewith.

* Signature affixed by Robert C. Hacker pursuant to a power of
attorney dated December 19, 1996 and filed herewith.

** Signature affixed by Robert C. Hacker pursuant to a power of
attorney dated March 6, 1997 and filed herewith.

POWER OF ATTORNEY

I, the undersigned President and Director, Trustee, or General
Partner, as the case may be, of the following investment companies:

Fidelity Aberdeen Street Trust Fidelity Hereford Street Trust
Fidelity Advisor Series I Fidelity Income Fund
Fidelity Advisor Series II Fidelity Institutional Cash
Fidelity Advisor Series III Portfolios
Fidelity Advisor Series IV Fidelity Institutional
Fidelity Advisor Series V Tax-Exempt Cash Portfolios
Fidelity Advisor Series VI Fidelity Investment Trust
Fidelity Advisor Series VII Fidelity Magellan Fund
Fidelity Advisor Series VIII Fidelity Massachusetts
Fidelity Beacon Street Trust Municipal Trust
Fidelity Boston Street Trust Fidelity Money Market Trust
Fidelity California Municipal Fidelity Mt. Vernon Street
Trust Trust
Fidelity California Municipal Fidelity Municipal Trust
Trust II Fidelity Municipal Trust II
Fidelity Capital Trust Fidelity New York Municipal
Fidelity Charles Street Trust Trust
Fidelity Commonwealth Trust Fidelity New York Municipal
Fidelity Concord Street Trust Trust II
Fidelity Congress Street Fund Fidelity Phillips Street Trust
Fidelity Contrafund Fidelity Puritan Trust
Fidelity Corporate Trust Fidelity Revere Street Trust
Fidelity Court Street Trust Fidelity School Street Trust
Fidelity Court Street Trust II Fidelity Securities Fund
Fidelity Covington Trust Fidelity Select Portfolios
Fidelity Daily Money Fund Fidelity Sterling Performance
Fidelity Destiny Portfolios Portfolio, L.P.
Fidelity Deutsche Mark Fidelity Summer Street Trust
Performance Fidelity Trend Fund
Portfolio, L.P. Fidelity U.S.
Fidelity Devonshire Trust Investments-Bond Fund, L.P.
Fidelity Exchange Fund Fidelity U.S.
Fidelity Financial Trust Investments-Government
Fidelity Fixed-Income Trust Securities
Fidelity Government Fund, L.P.
Securities Fund Fidelity Union Street Trust
Fidelity Hastings Street Trust Fidelity Union Street Trust II
Fidelity Yen Performance
Portfolio, L.P.
Newbury Street Trust
Variable Insurance Products
Fund
Variable Insurance Products
Fund II
Variable Insurance Products
Fund III

in addition to any other investment company for which Fidelity
Management & Research Company or an affiliate acts as investment
adviser and for which the undersigned individual serves as President
and Director, Trustee, or General Partner (collectively, the "Funds"),
hereby constitute and appoint Robert C. Pozen my true and lawful
attorney-in-fact, with full power of substitution, and with full power
to him to sign for me and in my name in the appropriate capacity, all
Registration Statements of the Funds on Form N-1A, Form N-8A, or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A, Form N-8A, or any successor thereto, any
Registration Statements on Form N-14, and any supplements or other
instruments in connection therewith, and generally to do all such
things in my name and on my behalf in connection therewith as said
attorney-in-fact deems necessary or appropriate, to comply with the
provisions of the Securities Act of 1933 and the Investment Company
Act of 1940, and all related requirements of the Securities and
Exchange Commission. I hereby ratify and confirm all that said
attorney-in-fact or his substitutes may do or cause to be done by
virtue hereof. This power of attorney is effective for all documents
filed on or after August 1, 1997.

WITNESS my hand on the date set forth below.
/s/Edward C. Johnson 3d_ July 17, 1997

Edward C. Johnson 3d

POWER OF ATTORNEY

We, the undersigned Directors, Trustees, or General Partners, as the
case may be, of the following investment companies:

Fidelity Aberdeen Street Trust Fidelity Government
Fidelity Advisor Annuity Fund Securities Fund
Fidelity Advisor Series I Fidelity Hastings Street Trust
Fidelity Advisor Series II Fidelity Hereford Street Trust
Fidelity Advisor Series III Fidelity Income Fund
Fidelity Advisor Series IV Fidelity Institutional Cash
Fidelity Advisor Series V Portfolios
Fidelity Advisor Series VI Fidelity Institutional
Fidelity Advisor Series VII Tax-Exempt Cash Portfolios
Fidelity Advisor Series VIII Fidelity Institutional Trust
Fidelity Beacon Street Trust Fidelity Investment Trust
Fidelity Boston Street Trust Fidelity Magellan Fund
Fidelity California Municipal Fidelity Massachusetts
Trust Municipal Trust
Fidelity California Municipal Fidelity Money Market Trust
Trust II Fidelity Mt. Vernon Street
Fidelity Capital Trust Trust
Fidelity Charles Street Trust Fidelity Municipal Trust
Fidelity Commonwealth Trust Fidelity Municipal Trust II
Fidelity Congress Street Fund Fidelity New York Municipal
Fidelity Contrafund Trust
Fidelity Corporate Trust Fidelity New York Municipal
Fidelity Court Street Trust Trust II
Fidelity Court Street Trust II Fidelity Phillips Street Trust
Fidelity Covington Trust Fidelity Puritan Trust
Fidelity Daily Money Fund Fidelity Revere Street Trust
Fidelity Daily Tax-Exempt Fund Fidelity School Street Trust
Fidelity Destiny Portfolios Fidelity Securities Fund
Fidelity Deutsche Mark Fidelity Select Portfolios
Performance Fidelity Sterling Performance
Portfolio, L.P. Portfolio, L.P.
Fidelity Devonshire Trust Fidelity Summer Street Trust
Fidelity Exchange Fund Fidelity Trend Fund
Fidelity Financial Trust Fidelity U.S.
Fidelity Fixed-Income Trust Investments-Bond Fund, L.P.
Fidelity U.S.
Investments-Government
Securities
Fund, L.P.
Fidelity Union Street Trust
Fidelity Union Street Trust II
Fidelity Yen Performance
Portfolio, L.P.
Variable Insurance Products
Fund
Variable Insurance Products
Fund II

plus any other investment company for which Fidelity Management &
Research Company or an affiliate acts as investment adviser and for
which the undersigned individual serves as Directors, Trustees, or
General Partners (collectively, the "Funds"), hereby constitute and
appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis,
Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L.
Platt, each of them singly, our true and lawful attorneys-in-fact,
with full power of substitution, and with full power to each of them,
to sign for us and in our names in the appropriate capacities, all
Registration Statements of the Funds on Form N-1A, Form N-8A or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A or any successor thereto, any Registration
Statements on Form N-14, and any supplements or other instruments in
connection therewith, and generally to do all such things in our names
and behalf in connection therewith as said attorneys-in-fact deems
necessary or appropriate, to comply with the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, and all
related requirements of the Securities and Exchange Commission. I
hereby ratify and confirm all that said attorneys-in-fact or their
substitutes may do or cause to be done by virtue hereof. This power
of attorney is effective for all documents filed on or after January
1, 1997.

WITNESS our hands on this nineteenth day of December, 1996.

/s/Edward C. Johnson /s/Peter S.
3d___________ Lynch________________

Edward C. Johnson 3d Peter S. Lynch

/s/J. Gary /s/William O.
Burkhead_______________ McCoy______________

J. Gary Burkhead William O. McCoy

/s/Ralph F. Cox /s/Gerald C.
__________________ McDonough___________

Ralph F. Cox Gerald C. McDonough

/s/Phyllis Burke /s/Marvin L.
Davis_____________ Mann________________

Phyllis Burke Davis Marvin L. Mann

/s/E. Bradley /s/Thomas R. Williams
Jones________________ ____________

E. Bradley Jones Thomas R. Williams

/s/Donald J. Kirk
__________________

Donald J. Kirk

POWER OF ATTORNEY

I, the undersigned Director, Trustee, or General Partner, as the case
may be, of the following investment companies:

plus any other investment company for which Fidelity Management &
Research Company or an affiliate acts as investment adviser and for
which the undersigned individual serves as Director, Trustee, or
General Partner (collectively, the "Funds"), hereby constitute and
appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis,
Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L.
Platt, each of them singly, my true and lawful attorneys-in-fact, with
full power of substitution, and with full power to each of them, to
sign for me and in my name in the appropriate capacities, all
Registration Statements of the Funds on Form N-1A, Form N-8A or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A or any successor thereto, any Registration
Statements on Form N-14, and any supplements or other instruments in
connection therewith, and generally to do all such things in my name
and behalf in connection therewith as said attorneys-in-fact deem
necessary or appropriate, to comply with the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, and all
related requirements of the Securities and Exchange Commission. I
hereby ratify and confirm all that said attorneys-in-fact or their
substitutes may do or cause to be done by virtue hereof. This power
of attorney is effective for all documents filed on or after March 1,
1997.

WITNESS my hand on the date set forth below.
/s/Robert M. Gates March 6, 1997

Robert M. Gates

Exhibit (a)(4)

Supplement To
Trust Instrument of
Daily Money Fund

This Supplement to the Trust Instrument of Daily Money Fund, (the
"Trust"), dated June 20, 1991, is adopted by the Trustees pursuant to
Article XI, Section 11.06 and 11.08, of the Trust and incorporates all
amendments to the Trust Instrument in effect as of the date hereof as
follows:

1. The Trust Instrument is amended by a resolution of the Trustees
adopted at a meeting on February 18, 1999, by amending and restating
Section 1.01 in its entirety as follows:
"The name of the Trust created hereby is the "Fidelity Oxford Street
Trust."

2. The Trust Instrument is amended by a resolution of the Trustees
adopted at a meeting on February 18, 1999, by amending and restating
the second paragraph of Section 7.01 as follows:

VOTING POWERS.

Section 7.01. ...On any matter submitted to a vote of the
Shareholders, all Shares shall be voted separately by individual
Series, except (i) when required by the 1940 Act, Shares shall be
voted in the aggregate and not by individual Series; and (ii) when the
Trustees have determined that the matter affects the interests of more
than one Series, then the Shareholders of all such Series shall be
entitled to vote thereon. The Trustees may also determine that a
matter affects only the interests of one or more classes of a Series,
in which case any such matter shall be voted on by such class or
classes. A shareholder of each Series shall be entitled to one vote
for each dollar of net asset value (number of shares owned times net
asset value per share) of such Series on any matter on which such
shareholder is entitled to vote and each fractional dollar amount
shall be entitled to a proportionate fractional vote. There shall be
no cumulative voting in the election of Trustees. Shares may be voted
in person or by proxy or in any manner provided for in the Bylaws. A
proxy may be given in writing. The Bylaws may provide that proxies
may also, or may instead, be given by any electronic or
telecommunications device or in any other manner. Notwithstanding
anything else herein or in the Bylaws, in the event a proposal by
anyone other than the officers or Trustees of the Trust is submitted
to a vote of the Shareholders of one or more Series or of the Trust,
or in the event of any proxy contest or proxy solicitation or proposal
in opposition to any proposal by the officers or Trustees of the
Trust, Shares may be voted only in person or by written proxy. Until
Shares are issued, the Trustees may exercise all rights of
Shareholders and may take any action required or permitted by law,
this Trust Instrument or any of the Bylaws of the Trust to be taken by
Shareholders.

3. The Trust Instrument is amended by a resolution of the Trustees
adopted at a meeting on September 14, 1995, by adding Section 7.04 as
follows:

DERIVATIVE ACTIONS.

Section 7.04. Except as otherwise provided in Section 3816 of the
Delaware Act, all matters relating to the bringing of derivative
actions in the right of the Trust shall be governed by the General
Corporation Law of the State of Delaware relating to derivative
actions, and judicial interpretations thereunder, as if the Trust were
a Delaware corporation and the Shareholders were shareholders of a
Delaware corporation.

4. Section 11.05 of the Trust Instrument is amended and restated by a
resolution of the Trustees adopted at a meeting on September 14, 1995,
as follows:

MERGERS.

Section 11.05. (a) Notwithstanding anything else herein, the
Trustees, in order to change the form of organization of the Trust,
may, without prior Shareholder approval, (i) cause the Trust to merge
or consolidate with or into one or more trusts, partnerships (general
or limited), associations, limited liability companies or corporations
so long as the surviving or resulting entity is an open-end management
investment company under the 1940 Act, or is a Series thereof, that
will succeed to or assume the Trust's registration under that Act and
which is formed, organized or existing under the laws of a state,
commonwealth, possession or colony of the United States or (ii) cause
the Trust to incorporate under the laws of Delaware.

(b) The Trustees may, subject to a Majority Shareholder Vote of the
Trust, and subject to a vote of a majority of the Trustees, cause the
Trust to merge or consolidate with or into one or more trusts,
partnerships (general or limited), associations, limited liability
companies or corporations.

(c) Any agreement of merger or consolidation or certificate of merger
or consolidation may be signed by a majority of Trustees and facsimile
signatures conveyed by electronic or telecommunication means shall be
valid.

(d) Pursuant to and in accordance with the provisions of Section 3815
(f) of the Delaware Act, and notwithstanding anything to the contrary
contained in this Trust Instrument, an agreement of merger or
consolidation approved by the Trustees in accordance with paragraphs
(a) or (b) of this Section 11.05 may effect any amendment to the Trust
Instrument or effect the adoption of a new trust instrument of the
Trust if it is the surviving or resulting trust in the merger or
consolidation.

5. Section 10.01 of the Trust Instrument is amended and restated by a
resolution of the Trustees adopted at a meeting on September 14, 1995,
as follows:

LIMITATION OF LIABILITY.

Section 10.01. Neither a Trustee nor an officer of the Trust, when
acting in such capacity, shall be personally liable to any person
other than the Trust or a beneficial owner for any act, omission or
obligation of the Trust, any Trustee or any officer of the Trust.
Neither a Trustee nor an officer of the Trust shall be liable for any
act or omission or any conduct whatsoever in his capacity as Trustee
or as an officer of the Trust, provided that nothing contained herein
or in the Delaware Act shall protect any Trustee or any officer of the
Trust against any liability to the Trust or to Shareholders to which
he would otherwise be subject by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved
in the conduct of the office of Trustee or officer of the Trust
hereunder.

6. Section 11.02 is amended and restated by a resolution of the
Trustees adopted at a meeting on September 14, 1995, as follows:

TRUSTEES' AND OFFICERS' GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR
SURETY.

Section 11.02. The exercise by the Trustees or the officers of the
Trust of their powers and discretions hereunder in good faith and with
reasonable care under the circumstances then prevailing shall be
binding upon everyone interested. Subject to the provisions of Article
X hereof and to Section 11.01 of this Article XI, the Trustees and the
officers of the Trust shall not be liable for errors of judgment or
mistakes of fact or law. The Trustees and the officers of the Trust
may take advice of counsel or other experts with respect to the
meaning and operation of this Trust Instrument, and subject to the
provisions of Article X hereof and Section 11.01 of this Article XI,
shall be under no liability for any act or omission in accordance with
such advice or for failing to follow such advice. The Trustees and the
officers of the Trust shall not be required to give any bond as such,
nor any surety if a bond is obtained.

7. Section 4.01 of the Trust Instrument is amended by resolution of
the Trustees action pursuant to the last sentence of Section 7.01
thereof and adopted by Unanimous Written Consent dated August 30,
1991, by redesignating subsections (w) and (x) as subsections (x) and
(y), respectively, and by adding new subsection (w) as follows:

(w) Notwithstanding any other provision hereof, to invest all of the
assets of the Series in a single open-end investment company,
including investment by means of transfer of such assets in exchange
for an interest or interests in such investment company;

8. Section 11.06 is amended by a resolution of the Trustees adopted at
a meeting on September 14, 1995 by adding after the first sentence the
following:

A supplemental trust instrument executed by any one Trustee may be
relied upon as a Supplement hereof.

IN WITNESS WHEREOF, the undersigned, being a trustee of the Trust,
has executed this instrument.

/s/Robert C. Pozen
Robert C. Pozen, as Trustee
and not individually.

Dated: February 18, 1999

Exhibit (d)(1)

FORM OF
MANAGEMENT CONTRACT
between
FIDELITY FOUR-IN-ONE INDEX FUND
and
STRATEGIC ADVISERS, INC.

AGREEMENT made this ___ day of ___ ____, by and between Fidelity
Oxford Street Trust, a Delaware business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Fund"), on behalf of its single existing series of shares of
beneficial interest (hereinafter called the "Portfolio"), and
Strategic Advisers, Inc., a Massachusetts corporation (hereinafter
called the "Adviser") as set forth in its entirety below.

1. (a) Investment Advisory Services. The Adviser undertakes to act
as investment adviser of the Portfolio and shall, subject to the
supervision of the Fund's Board of Trustees, direct the investments of
the Portfolio in accordance with the investment objective, policies
and limitations as provided in the Portfolio's Prospectus or other
governing instruments, as amended from time to time, the Investment
Company Act of 1940 and rules thereunder, as amended from time to time
(the "1940 Act"), and such other limitations as the Portfolio may
impose by notice in writing to the Adviser. The Adviser shall also
furnish for the use of the Portfolio office space and all necessary
office facilities, equipment and personnel for servicing the
investments of the Portfolio; and shall pay the salaries and fees of
all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all
personnel of the Fund or the Adviser performing services relating to
research, statistical and investment activities. The Adviser is
authorized, in its discretion and without prior consultation with the
Portfolio, to allocate the Portfolio's assets among the various
underlying Fidelity funds in which the Portfolio may invest and to
otherwise buy, sell, lend and otherwise trade in any stocks, bonds and
other securities and investment instruments on behalf of the Portfolio
as permitted under the Portfolio's investment policies. The Adviser
shall from time to time make recommendations to the Fund's Board of
Trustees with respect to the Portfolio's investment policies provided
that the investment policies and all other actions of the Portfolio
are and shall at all times be subject to the control and direction of
the Fund's Board of Trustees.

(b) Management Services. The Adviser shall perform (or arrange for
the performance by its affiliates of) the management and
administrative services necessary for the operation of the Fund. The
Adviser shall, subject to the supervision of the Board of Trustees,
perform various services for the Portfolio, including but not limited
to: (i) providing the Portfolio with office space, equipment and
facilities (which may be its own) for maintaining its organization;
(ii) on behalf of the Portfolio, supervising relations with, and
monitoring the performance of, custodians, depositories, transfer and
pricing agents, accountants, attorneys, underwriters, brokers and
dealers, insurers and other persons in any capacity deemed to be
necessary or desirable; (iii) preparing all general shareholder
communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered,
maintaining the registration and qualification of the Portfolio's
shares under federal and state law; and (vii) investigating the
development of and developing and implementing, if appropriate,
management and shareholder services designed to enhance the value or
convenience of the Portfolio as an investment vehicle.

The Adviser shall also furnish such reports, evaluations, information
or analyses to the Fund as the Fund's Board of Trustees may request
from time to time or as the Adviser may deem to be desirable. The
Adviser shall, subject to review by the Board of Trustees, furnish
such other services as the Adviser shall from time to time determine
to be necessary or useful to perform its obligations under this
Contract.

(c) The Adviser undertakes to pay, either itself or through an
affiliated company, all expenses involved in the operation of the
Portfolio, except the following, which shall be paid by the Portfolio:
(i) taxes; (ii) the fees and expenses of all Trustees of the Fund who
are not "interested persons" of the Fund or of the Adviser; (iii)
brokerage fees and commissions; (iv) interest expenses with respect to
borrowings by the Portfolio; and (v) such non-recurring and
extraordinary expenses as may arise, including actions, suits or
proceedings to which the Portfolio is or is threatened to be a party
and the legal obligation that the Portfolio may have to indemnify the
Fund's Trustees and officers with respect thereto. It is understood
that service charges billed directly to shareholders of the Portfolio,
including charges for exchanges, redemptions, sub-accounting or other
services, shall not be payable by the Adviser, but may be received and
retained by the Adviser or its affiliates.

(d) The Adviser, either itself or through an affiliated company or
through the Portfolio's custodian, shall place all orders for the
purchase and sale of Fidelity mutual fund shares for the Portfolio's
account with such underlying funds' transfer agents. With respect to
portfolio securities other than Fidelity mutual fund shares, the
Adviser, either itself or through an affiliated company, shall place
all purchase and sale orders for the Portfolio's account with brokers
or dealers selected by the Adviser, which may include brokers or
dealers affiliated with the Adviser. The Adviser shall use its best
efforts to seek to execute portfolio transactions at prices which are
advantageous to the Portfolio and at commission rates which are
reasonable in relation to the benefits received. In selecting brokers
or dealers qualified to execute a particular transaction, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other
accounts over which the Adviser or its affiliates exercise investment
discretion. The Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Adviser determines in
good faith that such amount of commission is reasonable in relation to
the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Adviser and its affiliates have with respect to accounts over which
they exercise investment discretion. The Trustees of the Fund shall
periodically review the commissions paid by the Portfolio to determine
if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.

The Adviser shall, in acting hereunder, be an independent contractor.
The Adviser shall not be an agent of the Portfolio.

2. It is understood that the Trustees, officers and shareholders of
the Fund are or may be or become interested in the Adviser as
directors, officers or otherwise and that directors, officers and
stockholders of the Adviser are or may be or become similarly
interested in the Fund, and that the Adviser may be or become
interested in the Fund as a shareholder or otherwise.

3. For the services and facilities to be furnished hereunder, the
Adviser shall receive a monthly management fee, payable monthly as
soon as practicable after the last day of each month, at the annual
rate of .__% of the average daily net assets of the Portfolio
(computed in the manner set forth in the Fund's Trust Instrument)
throughout the month; provided that the fee, so computed, shall be
reduced by the compensation, including reimbursement of expenses, paid
by the Portfolio to those Trustees who are not "interested persons" of
the Fund or the Adviser.

In case of initiation or termination of this Contract during any
month, the fee for that month shall be reduced proportionately on the
basis of the number of business days during which it is in effect, and
the fee computed upon the average net assets for the business days it
is so in effect for that month.

4. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and
engage in other activities, provided, however, that such other
services and activities do not, during the term of this Contract,
interfere, in a material manner, with the Adviser's ability to meet
all of its obligations with respect to rendering services to the
Portfolio hereunder. In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Portfolio or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the
purchase, holding or sale of any security or other investment
instrument.

5. (a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 5, this Contract shall continue in force until July
31, 1999 and indefinitely thereafter, but only so long as the
continuance after such date shall be specifically approved at least
annually by vote of the Trustees of the Fund or by vote of a majority
of the outstanding voting securities of the Portfolio.

(b) This Contract may be modified by mutual consent subject to the
provisions of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Securities and
Exchange Commission (the "Commission") or any rules or regulations
adopted by, or interpretative releases of, the Commission.

(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 5, the terms of any continuance or modification of this
Contract must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval.

(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Contract, without payment
of any penalty, by action of its Trustees or Board of Directors, as
the case may be, or with respect to the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio. This
Contract shall terminate automatically in the event of its assignment.

6. The Adviser is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Trust Instrument or
other organizational documents and agrees that the obligations assumed
by the Fund pursuant to this Contract shall be limited in all cases to
the Portfolio and its assets, and the Adviser shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio or any other Portfolios of the Fund. In
addition, the Adviser shall not seek satisfaction of any such
obligations from the Trustees or any individual Trustee. The Adviser
understands that the rights and obligations of any Portfolio under the
Trust Instrument or other organizational documents are separate and
distinct from those of any and all other Portfolios.

7. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.

The terms "vote of a majority of the outstanding voting securities,"
"assignment," and "interested persons," when used herein, shall have
the respective meanings specified in the 1940 Act, as now in effect or
as hereafter amended, and subject to such orders as may be granted by
the Commission.

IN WITNESS WHEREOF the parties have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.

[SIGNATURE LINES OMITTED]

Exhibit (d)(2)

FORM OF
ADMINISTRATION AGREEMENT
between
STRATEGIC ADVISERS, INC.
and
FIDELITY MANAGEMENT & RESEARCH COMPANY

AGREEMENT dated as of this ___ day of ____, ____ between Strategic
Advisers, Inc., a Massachusetts corporation (the "Adviser"), and
Fidelity Management & Research Company, a Massachusetts corporation
(the "Administrator").

WHEREAS, the Adviser has entered into a Management Agreement (the
"Management Agreement"), dated ________, with Fidelity Oxford Street
Trust (the "Fund") on behalf of Fidelity Four-in-One Index Fund (the
"Portfolio");

WHEREAS, pursuant to the Management Agreement, the Adviser has agreed
to perform (or arrange for the performance by its affiliates of)
certain investment advisory and other management services on behalf of
the Portfolio; and

WHEREAS, the Adviser desires to appoint the Administrator as its
agent to perform on behalf of the Portfolio all services enumerated in
the Management Agreement other than investment advisory services, and
the Administrator is willing to accept such appointment;

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained in this Agreement, the Adviser and the Administrator hereby
agree as follows:

1. The Adviser hereby appoints the Administrator as its agent to
perform (or arrange for the performance by its affiliates of) the
services described herein, and the Administrator hereby accepts such
appointment, subject to and in accordance with the following
provisions.

2.(a) The Administrator shall perform (or arrange for the
performance by its affiliates of) all of the management and
administrative services to be performed on behalf of the Portfolio by
the Adviser pursuant to the Management Agreement other than those
services described in paragraphs 1(a) and 1(d) thereof.

(b) Without limiting the foregoing, the Administrator shall, subject
to the supervision of the Adviser, perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund set forth in
paragraph 1(b) of the Management Agreement. Such services shall
include, but not be limited to:

(i) providing the Portfolio with office space, equipment and
facilities (which may be its own) for maintaining its organization;

(ii) on behalf of the Portfolio, supervising relations with, and
monitoring the performance of, custodians, depositories, transfer and
pricing agents, accountants, attorneys, underwriters, brokers and
dealers, insurers and other persons in any capacity deemed to be
necessary or desirable;

(iii) preparing all general shareholder communications, including
shareholder reports;

(iv) conducting shareholder relations;

(v) maintaining the Fund's existence and its records;

(vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under
federal and state law; and

(vii) investigating the development of and developing and
implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.

The Administrator shall also furnish such reports, evaluations,
information or analyses to the Fund or the Adviser as the Fund's Board
of Trustees or the Adviser may request from time to time or as the
Administrator may deem to be desirable. The Administrator shall,
subject to review by the Adviser and the Board of Trustees, furnish
such other services as the Administrator shall from time to time
determine to be necessary or useful to perform its obligations under
this Agreement.

(c) The Administrator undertakes to pay, either itself or through an
affiliated company, all expenses involved in the operation of the
Portfolio, except (i) the management fee payable by the Portfolio
pursuant to paragraph 3 of the Management Agreement, (ii) the other
expenses payable by the Portfolio pursuant to paragraph 1(c) of the
Management Agreement, and (iii) the expenses of the Adviser incurred
in the performance of its obligations pursuant to paragraphs 1(a) and
1(d) of the Management Agreement, except that the Administrator shall
be responsible for paying the salaries and fees of all officers of the
Fund and of all Trustees of the Fund who are "interested persons" of
the Fund or of the Administrator. It is understood that service
charges billed directly to shareholders of the Portfolio, including
charges for exchanges, redemptions, sub-accounting or other services,
shall not be payable by the Administrator, but may be received and
retained by the Administrator or its affiliates.

3. It is understood that the Trustees, officers and shareholders of
the Fund are or may be or become interested in the Administrator as
directors, officers or otherwise and that directors, officers and
stockholders of the Administrator are or may be or become similarly
interested in the Fund, and that the Administrator may be or become
interested in the Fund as a shareholder or otherwise.

4. For the services and facilities to be furnished hereunder, the
Adviser shall pay the Administrator a fee, payable monthly as soon as
practicable after the last day of each month, equal to the monthly
management fee received from the Portfolio by the Adviser under the
Management Agreement, less an amount equal to an annual rate of .__%
of the average daily net assets of the Portfolio (computed in the
manner set forth in the Fund's Trust Instrument) throughout the month,
provided that if the fee calculated in accordance with the preceding
clause for any month shall be less than zero, the Administrator shall
not receive any fee for such month but shall have no obligation to
reimburse the Adviser.

5. The services of the Administrator to the Portfolio are not to be
deemed exclusive, the Administrator being free to render services to
others and engage in other activities, provided, however, that such
other services and activities do not, during the term of this
Agreement, interfere in a material manner with the Administrator's
ability to meet all of its obligations with respect to rendering
services to the Portfolio hereunder. In the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of
obligations or duties hereunder on the part of the Administrator, the
Administrator shall not be subject to liability to the Adviser, the
Portfolio or to any shareholder of the Portfolio for any act or
omission in the course of, or connected with, rendering services
hereunder or for any losses that may be sustained in the purchase,
holding or sale of any security or other investment instrument.

6.(a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 6, this Agreement shall continue in force until July
31, 1999 and indefinitely thereafter, but only so long as the
continuance after such date shall be specifically approved at least
annually by vote of the Trustees of the Fund or by vote of a majority
of the outstanding voting securities of the Portfolio.

(b) This Agreement may be modified by mutual consent of the parties
hereto, provided that any such modification shall be authorized by the
vote of the Trustees of the Fund or by a vote of a majority of the
outstanding voting securities of the Portfolio.

(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 6, the terms of any continuance or modification of this
Agreement must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Agreement, the
Management Agreement or interested persons of any such party, cast in
person at a meeting called for the purpose of voting on such approval.

(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Agreement without payment
of any penalty. This Agreement may be terminated at any time, without
payment of any penalty, by the vote of a majority of those Trustees of
the Fund who are not parties to this Agreement, the Management
Agreement or interested persons of any such party, or by vote of a
majority of the outstanding voting securities of the Portfolio. This
Agreement shall terminate automatically in the event of its assignment
or upon termination of the Management Agreement.

7. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.

8. The terms "vote of a majority of outstanding voting securities,"
"assignment," and "interested persons," when used herein, shall have
the meanings specified in the Investment Company Act of 1940 and rules
thereunder, as now in effect or as hereafter amended, and subject to
such orders as may be granted by the Securities and Exchange
Commission.

IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the day and year first above written.

[SIGNATURE LINES OMITTED]

Exhibit (e)(1)

FORM OF
GENERAL DISTRIBUTION AGREEMENT
between
FIDELITY OXFORD STREET TRUST
and
FIDELITY DISTRIBUTORS CORPORATION

Agreement made this day of , , between Fidelity
Oxford Street Trust, a Delaware business trust having its principal
place of business in Boston, Massachusetts and which may issue one or
more series of beneficial interest ("Issuer"), with respect to shares
of Fidelity Four-in-One Index Fund, a series of the Issuer, and
Fidelity Distributors Corporation, a Massachusetts corporation having
its principal place of business in Boston, Massachusetts
("Distributors").

In consideration of the mutual promises and undertakings herein
contained, the parties agree as follows:

1. Sale of Shares - The Issuer grants to Distributors the right to
sell shares on behalf of the Issuer during the term of this Agreement
and subject to the registration requirements of the Securities Act of
1933, as amended ("1933 Act"), and of the laws governing the sale of
securities in the various states ("Blue Sky Laws") under the following
terms and conditions: Distributors (i) shall have the right to sell,
as agent on behalf of the Issuer, shares authorized for issue and
registered under the 1933 Act, and (ii) may sell shares under offers
of exchange, if available, between and among the funds advised by
Fidelity Management & Research Company ("FMR") or any of its
affiliates.

2. Sale of Shares by the Issuer - The rights granted to Distributors
shall be nonexclusive in that the Issuer reserves the right to sell
its shares to investors on applications received and accepted by the
Issuer. Further, the Issuer reserves the right to issue shares in
connection with the merger or consolidation, or acquisition by the
Issuer through purchase or otherwise, with any other investment
company, trust, or personal holding company.

3. Shares Covered by this Agreement - This Agreement shall apply to
unissued shares of the Issuer, shares of the Issuer held in its
treasury in the event that in the discretion of the Issuer treasury
shares shall be sold, and shares of the Issuer repurchased for resale.

4. Public Offering Price - Except as otherwise noted in the Issuer's
current Prospectus and/or Statement of Additional Information, all
shares sold to investors by Distributors or the Issuer will be sold at
the public offering price. The public offering price for all accepted
subscriptions will be the net asset value per share, as determined in
the manner described in the Issuer's current Prospectus and/or
Statement of Additional Information, plus a sales charge (if any)
described in the Issuer's current Prospectus and/or Statement of
Additional Information. The Issuer shall in all cases receive the net
asset value per share on all sales. If a sales charge is in effect,
Distributors shall have the right subject to such rules or regulations
of the Securities and Exchange Commission as may then be in effect
pursuant to Section 22 of the Investment Company Act of 1940 to pay a
portion of the sales charge to dealers who have sold shares of the
Issuer. If a fee in connection with shareholder redemptions is in
effect, the Issuer shall collect the fee on behalf of Distributors
and, unless otherwise agreed upon by the Issuer and Distributors,
Distributors shall be entitled to receive all of such fees.

5. Suspension of Sales - If and whenever the determination of net
asset value is suspended and until such suspension is terminated, no
further orders for shares shall be processed by Distributors except
such unconditional orders as may have been placed with Distributors
before it had knowledge of the suspension. In addition, the Issuer
reserves the right to suspend sales and Distributors' authority to
process orders for shares on behalf of the Issuer if, in the judgment
of the Issuer, it is in the best interests of the Issuer to do so.
Suspension will continue for such period as may be determined by the
Issuer.

6. Solicitation of Sales - In consideration of these rights granted to
Distributors, Distributors agrees to use all reasonable efforts,
consistent with its other business, to secure purchasers for shares of
the Issuer. This shall not prevent Distributors from entering into
like arrangements (including arrangements involving the payment of
underwriting commissions) with other issuers. This does not obligate
Distributors to register as a broker or dealer under the Blue Sky Laws
of any jurisdiction in which it is not now registered or to maintain
its registration in any jurisdiction in which it is now registered.
If a sales charge is in effect, Distributors shall have the right to
enter into sales agreements with dealers of its choice for the sale of
shares of the Issuer to the public at the public offering price only
and fix in such agreements the portion of the sales charge which may
be retained by dealers, provided that the Issuer shall approve the
form of the dealer agreement and the dealer discounts set forth
therein and shall evidence such approval by filing said form of dealer
agreement and amendments thereto as an exhibit to its currently
effective Registration Statement under the 1933 Act.

7. Authorized Representations - Distributors is not authorized by the
Issuer to give any information or to make any representations other
than those contained in the appropriate registration statements or
Prospectuses and Statements of Additional Information filed with the
Securities and Exchange Commission under the 1933 Act (as these
registration statements, Prospectuses and Statements of Additional
Information may be amended from time to time), or contained in
shareholder reports or other material that may be prepared by or on
behalf of the Issuer for Distributors' use. This shall not be
construed to prevent Distributors from preparing and distributing
sales literature or other material as it may deem appropriate.

8. Portfolio Securities - Portfolio securities of the Issuer may be
bought or sold by or through Distributors, and Distributors may
participate directly or indirectly in brokerage commissions or
"spreads" for transactions in portfolio securities of the Issuer.

9. Registration of Shares - The Issuer agrees that it will take all
action necessary to register shares under the 1933 Act (subject to the
necessary approval of its shareholders) so that there will be
available for sale the number of shares Distributors may reasonably be
expected to sell. The Issuer shall make available to Distributors
such number of copies of its currently effective Prospectus and
Statement of Additional Information as Distributors may reasonably
request. The Issuer shall furnish to Distributors copies of all
information, financial statements and other papers which Distributors
may reasonably request for use in connection with the distribution of
shares of the Issuer.

10. Expenses - The Issuer shall pay all fees and expenses (a) in
connection with the preparation, setting in type and filing of any
registration statement, Prospectus and Statement of Additional
Information under the 1933 Act and amendments for the issue of its
shares, (b) in connection with the registration and qualification of
shares for sale in the various states in which the Board of Trustees
of the Issuer shall determine it advisable to qualify such shares for
sale (including registering the Issuer as a broker or dealer or any
officer of the Issuer as agent or salesman in any state), (c) of
preparing, setting in type, printing and mailing any report or other
communication to shareholders of the Issuer in their capacity as such,
and (d) of preparing, setting in type, printing and mailing
Prospectuses, Statements of Additional Information and any supplements
thereto sent to existing shareholders.

As provided in the Distribution and Service Plan adopted by the
Issuer, it is recognized by the Issuer that Strategic Advisers, Inc.
("Strategic Advisers"), an affiliate of FMR, and/or FMR may make
payment to Distributors with respect to any expenses incurred in the
distribution of shares of the Issuer, such payments payable from the
past profits or other resources of Strategic Advisers or FMR, as the
case may be, including management fees paid to Strategic Advisers by
the Issuer, or fees paid to FMR by Strategic Advisers out of such
management fees.

11. Indemnification - The Issuer agrees to indemnify and hold harmless
Distributors and each of its directors and officers and each person,
if any, who controls Distributors within the meaning of Section 15 of
the 1933 Act against any loss, liability, claim, damages or expense
(including the reasonable cost of investigating or defending any
alleged loss, liability, claim, damages, or expense and reasonable
counsel fees incurred in connection therewith) arising by reason of
any person acquiring any shares, based upon the ground that the
registration statement, Prospectus, Statement of Additional
Information, shareholder reports or other information filed or made
public by the Issuer (as from time to time amended) included an untrue
statement of a material fact or omitted to state a material fact
required to be stated or necessary in order to make the statements not
misleading under the 1933 Act, or any other statute or the common law.
However, the Issuer does not agree to indemnify Distributors or hold
it harmless to the extent that the statement or omission was made in
reliance upon, and in conformity with, information furnished to the
Issuer by or on behalf of Distributors. In no case (i) is the
indemnity of the Issuer in favor of Distributors or any person
indemnified to be deemed to protect Distributors or any person against
any liability to the Issuer or its security holders to which
Distributors or such person would otherwise be subject by reason of
wilful misfeasance, bad faith or gross negligence in the performance
of its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement, or (ii) is the Issuer to
be liable under its indemnity agreement contained in this paragraph
with respect to any claim made against Distributors or any person
indemnified unless Distributors or person, as the case may be, shall
have notified the Issuer in writing of the claim within a reasonable
time after the summons or other first written notification giving
information of the nature of the claim shall have been served upon
Distributors or any such person (or after Distributors or such person
shall have received notice of service on any designated agent).
However, failure to notify the Issuer of any claim shall not relieve
the Issuer from any liability which it may have to Distributors or any
person against whom such action is brought otherwise than on account
of its indemnity agreement contained in this paragraph. The Issuer
shall be entitled to participate at its own expense in the defense,
or, if it so elects, to assume the defense of any suit brought to
enforce any claims, but if the Issuer elects to assume the defense,
the defense shall be conducted by counsel chosen by it and
satisfactory to Distributors or person or persons, defendant or
defendants in the suit. In the event the Issuer elects to assume the
defense of any suit and retain counsel, Distributors, officers or
directors or controlling person or persons, defendant or defendants in
the suit, shall bear the fees and expenses of any additional counsel
retained by them. If the Issuer does not elect to assume the defense
of any suit, it will reimburse Distributors, officers or directors or
controlling person or persons, defendant or defendants in the suit,
for the reasonable fees and expenses of any counsel retained by them.
The Issuer agrees to notify Distributors promptly of the commencement
of any litigation or proceedings against it or any of its officers or
trustees in connection with the issuance or sale of any of the shares.

Distributors also covenants and agrees that it will indemnify and
hold harmless the Issuer and each of its Board members and officers
and each person, if any, who controls the Issuer within the meaning of
Section 15 of the 1933 Act, against any loss, liability, damages,
claim or expense (including the reasonable cost of investigating or
defending any alleged loss, liability, damages, claim or expense and
reasonable counsel fees incurred in connection therewith) arising by
reason of any person acquiring any shares, based upon the 1933 Act or
any other statute or common law, alleging any wrongful act of
Distributors or any of its employees or alleging that the registration
statement, Prospectus, Statement of Additional Information,
shareholder reports or other information filed or made public by the
Issuer (as from time to time amended) included an untrue statement of
a material fact or omitted to state a material fact required to be
stated or necessary in order to make the statements not misleading,
insofar as the statement or omission was made in reliance upon, and in
conformity with information furnished to the Issuer by or on behalf of
Distributors. In no case (i) is the indemnity of Distributors in
favor of the Issuer or any person indemnified to be deemed to protect
the Issuer or any person against any liability to which the Issuer or
such person would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and
duties under this Agreement, or (ii) is Distributors to be liable
under its indemnity agreement contained in this paragraph with respect
to any claim made against the Issuer or any person indemnified unless
the Issuer or person, as the case may be, shall have notified
Distributors in writing of the claim within a reasonable time after
the summons or other first written notification giving information of
the nature of the claim shall have been served upon the Issuer or any
such person (or after the Issuer or such person shall have received
notice of service on any designated agent). However, failure to
notify Distributors of any claim shall not relieve Distributors from
any liability which it may have to the Issuer or any person against
whom the action is brought otherwise than on account of its indemnity
agreement contained in this paragraph. In the case of any notice to
Distributors, it shall be entitled to participate, at its own expense,
in the defense or, if it so elects, to assume the defense of any suit
brought to enforce the claim, but if Distributors elects to assume the
defense, the defense shall be conducted by counsel chosen by it and
satisfactory to the Issuer, to its officers and Board and to any
controlling person or persons, defendant or defendants in the suit.
In the event that Distributors elects to assume the defense of any
suit and retain counsel, the Issuer or controlling persons, defendant
or defendants in the suit, shall bear the fees and expense of any
additional counsel retained by them. If Distributors does not elect
to assume the defense of any suit, it will reimburse the Issuer,
officers and Board or controlling person or persons, defendant or
defendants in the suit, for the reasonable fees and expenses of any
counsel retained by them. Distributors agrees to notify the Issuer
promptly of the commencement of any litigation or proceedings against
it in connection with the issue and sale of any of the shares.

12. Effective Date - This agreement shall be effective upon its
execution, and unless terminated as provided, shall continue in force
until March 31, 2000 and thereafter from year to year, provided
continuance is approved annually by the vote of a majority of the
Board members of the Issuer, and by the vote of those Board members of
the Issuer who are not "interested persons" of the Issuer and, if a
plan under Rule 12b-1 under the Investment Company Act of 1940 is in
effect, by the vote of those Board members of the Issuer who are not
"interested persons" of the Issuer and who are not parties to the
Distribution and Service Plan or this Agreement and have no financial
interest in the operation of the Distribution and Service Plan or in
any agreements related to the Distribution and Service Plan, cast in
person at a meeting called for the purpose of voting on the approval.
This Agreement shall automatically terminate in the event of its
assignment. As used in this paragraph, the terms "assignment" and
"interested persons" shall have the respective meanings specified in
the Investment Company Act of 1940 as now in effect or as hereafter
amended. In addition to termination by failure to approve continuance
or by assignment, this Agreement may at any time be terminated by
either party upon not less than sixty days' prior written notice to
the other party.

13. Notice - Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice
to the other party at the last address furnished by the other party to
the party giving notice: if to the Issuer, at 82 Devonshire Street,
Boston, Massachusetts, and if to Distributors, at 82 Devonshire
Street, Boston, Massachusetts.

14. Limitation of Liability - Distributors is expressly put on notice
of the limitation of shareholder liability as set forth in the Trust
Instrument or other organizational document of the Issuer and agrees
that the obligations assumed by the Issuer under this contract shall
be limited in all cases to the Issuer and its assets. Distributors
shall not seek satisfaction of any such obligation from the
shareholders or any shareholder of the Issuer. Nor shall Distributors
seek satisfaction of any such obligation from the Trustees or any
individual Trustee of the Issuer. Distributors understands that the
rights and obligations of each series of shares of the Issuer under
the Issuer's Trust Instrument or other organizational document are
separate and distinct from those of any and all other series.

15. This agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.

IN WITNESS WHEREOF, the Issuer has executed this instrument in its
name and behalf, and its seal affixed, by one of its officers duly
authorized, and Distributors has executed this instrument in its name
and behalf by one of its officers duly authorized, as of the day and
year first above written.

[SIGNATURE LINES OMITTED]

Exhibit (m)(1)

FORM OF
DISTRIBUTION AND SERVICE PLAN
FIDELITY OXFORD STREET TRUST:
FIDELITY FOUR-IN-ONE INDEX FUND

1. This Distribution and Service Plan (the "Plan"), when effective in
accordance with its terms, shall be the written plan contemplated by
Rule 12b-1 under the Investment Company Act of 1940 (the "Act") of
Fidelity Four-in-One Index Fund (the "Portfolio"), a series of shares
of Fidelity Oxford Street Trust (the "Fund").

2. The Fund has entered into a General Distribution Agreement with
respect to the Portfolio with Fidelity Distributors Corporation (the
"Distributor"), a wholly-owned subsidiary of Fidelity Management &
Research Company ("FMR"), under which the Distributor uses all
reasonable efforts, consistent with its other business, to secure
purchasers for the Portfolio's shares of beneficial interest
("shares"). Under the agreement, the Distributor pays the expenses of
printing and distributing any prospectuses, reports and other
literature used by the Distributor, advertising, and other promotional
activities in connection with the offering of shares of the Portfolio
for sale to the public. It is recognized that Strategic Advisers,
Inc. ("Strategic Advisers"), an affiliate of FMR, and/or FMR may use
its revenues, including management fees paid to Strategic Advisers by
the Portfolio, or fees paid to FMR by Strategic Advisers out of such
management fees, as well as its past profits or its resources from any
other source, to make payment to the Distributor with respect to any
expenses incurred in connection with the distribution of shares of the
Portfolio, including the activities referred to above.

3. Strategic Advisers and/or FMR directly, or through the
Distributor, may, subject to the approval of the Trustees, make
payments to securities dealers and other third parties who engage in
the sale of shares or who render shareholder support services,
including but not limited to providing office space, equipment and
telephone facilities, answering routine inquiries regarding the
Portfolio, processing shareholder transactions and providing such
other shareholder services as the Fund may reasonably request.

4. The Portfolio will not make separate payments as a result of this
Plan to Strategic Advisers, FMR, the Distributor or any other party,
it being recognized that the Portfolio presently pays, and will
continue to pay, a management fee to Strategic Advisers. To the
extent that any payments made by the Portfolio to Strategic Advisers,
including payment of management fees, out of which management fees
Strategic Advisers may pay fees to FMR, should be deemed to be
indirect financing of any activity primarily intended to result in the
sale of shares of the Portfolio within the context of Rule 12b-1 under
the Act, then such payments shall be deemed to be authorized by this
Plan.

5. This Plan shall become effective upon the first business day of
the month following approval by a vote of at least a "majority of the
outstanding voting securities of the Portfolio" (as defined in the
Act), the plan having been approved by a vote of a majority of the
Trustees of the Fund, including a majority of Trustees who are not
"interested persons" of the Fund (as defined in the Act) and who have
no direct or indirect financial interest in the operation of this Plan
or in any agreements related to this Plan (the "Independent
Trustees"), cast in person at a meeting called for the purpose of
voting on this Plan.

6. This Plan shall, unless terminated as hereinafter provided, remain
in effect from the date specified above until April 30, 2000, and from
year to year thereafter, provided, however, that such continuance is
subject to approval annually by a vote of a majority of the Trustees
of the Fund, including a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on this Plan.
This Plan may be amended at any time by the Board of Trustees,
provided that (a) any amendment to authorize direct payments by the
Portfolio to finance any activity primarily intended to result in the
sale of shares of the Portfolio, to increase materially the amount
spent by the Portfolio for distribution[, or any amendment of the
Management Contract to increase the amount to be paid by the Portfolio
thereunder] shall be effective only upon approval by a vote of a
majority of the outstanding voting securities of the Portfolio, and
(b) any material amendments of this Plan shall be effective only upon
approval in the manner provided in the first sentence in this
paragraph.

7. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of the
Portfolio.

8. During the existence of this Plan, the Fund shall require
Strategic Advisers and/or FMR and/or Distributor to provide the Fund,
for review by the Fund's Board of Trustees, and the Trustees shall
review, at least quarterly, a written report of the amounts expended
in connection with financing any activity primarily intended to result
in the sale of shares of the Portfolio (making estimates of such costs
where necessary or desirable) and the purposes for which such
expenditures were made.

9. This Plan does not require Strategic Advisers, FMR, or Distributor
to perform any specific type or level of distribution activities or to
incur any specific level of expenses for activities primarily intended
to result in the sale of shares of the Portfolio.

10. Consistent with the limitation of shareholder liability as set
forth in the Fund's Trust Instrument or other organizational document,
any obligations assumed by the Portfolio pursuant to this Plan and any
agreements related to this Plan shall be limited in all cases to the
Portfolio and its assets, and shall not constitute obligations of any
other series of shares of the Fund.

11. If any provision of this Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.