SUPPLEMENT TO THE
FIDELITY TAX MANAGED STOCK FUND
DECEMBER 24, 1998
STATEMENT OF ADDITIONAL INFORMATION
THE FOLLOWING INFORMATION SUPPLEMENTS INFORMATION FOUND IN THE
"INVESTMENT POLICIES AND LIMITATIONS" SECTION BEGINNING ON PAGE 2.
For purposes of normally investing at least 65% of the fund's total
assets in common stocks, FMR interprets "total assets" to exclude
collateral received for securities lending transactions.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"INVESTMENT POLICIES AND LIMITATIONS" SECTION BEGINNING ON PAGE 2.
(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)).
(v) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 15% 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.)
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"EXPOSURE TO FOREIGN MARKETS" DISCLOSURE ON PAGE 4.
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
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.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"TRUSTEES AND OFFICERS" SECTION ON PAGE 15.
*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 Beacon Street Trust, is Mr. Johnson's daughter.
THE FOLLOWING INFORMATION SUPPLEMENTS SIMILAR INFORMATION FOUND IN THE
"TRUSTEES AND OFFICERS" SECTION BEGINNING ON PAGE 15.
ABIGAIL P. JOHNSON (37), Member of the Advisory Board of Fidelity
Beacon Street Trust, 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 3rd, Trustee and President of the Funds, is Ms.
Johnson's father.
NED C. LAUTENBACH (55), Member of the Advisory Board (1999), has
been a partner of Clayton, Dubilier & Rice, Inc. (private equity
investment firm) since September 1998. Mr. Lautenbach was Senior Vice
President of IBM Corporation from 1992 until his retirement in July
1998. From 1993 to 1995 he was Chairman of IBM World Trade
Corporation. He also was a member of IBM's Corporate Executive
Committee from 1994 to July 1998. He is a Director of PPG Industries
Inc. (glass, coating and chemical manufacturer), Dynatech Corporation
(global communications equipment), Eaton Corporation (global
manufacturer of highly engineered products) and ChoicePoint Inc. (data
identification, retrieval, storage, and analysis).
THE FOLLOWING INFORMATION FOUND IN THE "TRUSTEES AND OFFICERS"
SECTION BEGINNING ON PAGE 15 HAS BEEN REMOVED.
LEONARD M. RUSH (52), 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 INFORMATION REPLACES THE COMPENSATION TABLE FOUND IN THE
"TRUSTEES AND OFFICERS" SECTION BEGINNING ON PAGE 15.
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 October 31, 1998, or
calendar year ended December 31, 1997, as applicable.
<TABLE>
<CAPTION>
<S> <C> <C>
COMPENSATION TABLE
Trustees and Members of the Aggregate Compensation from Total Compensation from the
Advisory Board Tax Managed StockB,+ Fund Complex*,A
Edward C. Johnson 3d** $ 0 $ 0
Abigail P. Johnson** $ 0 $ 0
J. Gary Burkhead** $ 0 $ 0
Ralph F. Cox $ 16 $ 223,500
Phyllis Burke Davis $ 16 $ 220,500
Robert M. Gates $ 16 $ 223,500
E. Bradley Jones $ 16 $ 222,000
Donald J. Kirk $ 16 $ 226,500
Ned C. Lautenbach*** $ 0 $ 0
Peter S. Lynch** $ 0 $ 0
William O. McCoy $ 16 $ 223,500
Gerald C. McDonough $ 20 $ 273,500
Marvin L. Mann $ 16 $ 220,500
Robert C. Pozen** $ 0 $ 0
Thomas R. Williams $ 16 $ 223,500
</TABLE>
* Information is for the calendar year ended December 31, 1997 for 230
funds in the complex.
** Interested Trustees of the fund, Ms. Johnson and Mr. Burkhead are
compensated by FMR.
*** Effective October 14, 1999 , Mr. Lautenbach serves as a
Member of the Advisory Board.
+ Estimated for the fund's first fiscal year ending October 31, 1999.
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, 1997, the Trustees accrued required
deferred compensation from the funds as follows: Ralph F. Cox,
$75,000; Phyllis Burke Davis, $75,000; Robert M. Gates, $62,500; 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, $53,699; Marvin L. Mann, $53,699; and Thomas R.
Williams, $62,462.
B Compensation figures include cash.
THE FOLLOWING INFORMATION REPLACES THE "GROUP FEE RATE" AND "EFFECTIVE
ANNUAL FEE RATE" SCHEDULES FOUND ON PAGE 19.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Assets Annualized Rate Group Net Assets Effective Annual Fee Rate
0 - $3 billion .5200% $ 1 billion .5200%
3 - 6 .4900 50 .3823
6 - 9 .4600 100 .3512
9 - 12 .4300 150 .3371
12 - 15 .4000 200 .3284
15 - 18 .3850 250 .3219
18 - 21 .3700 300 .3163
21 - 24 .3600 350 .3113
24 - 30 .3500 400 .3067
30 - 36 .3450 450 .3024
36 - 42 .3400 500 .2982
42 - 48 .3350 550 .2942
48 - 66 .3250 600 .2904
66 - 84 .3200 650 .2870
84 - 102 .3150 700 .2838
102 - 138 .3100 750 .2809
138 - 174 .3050 800 .2782
174 - 210 .3000 850 .2756
210 - 246 .2950 900 .2732
246 - 282 .2900 950 .2710
282 - 318 .2850 1,000 .2689
318 - 354 .2800 1,050 .2669
354 - 390 .2750 1,100 .2649
390 - 426 .2700 1,150 .2631
426 - 462 .2650 1,200 .2614
462 - 498 .2600 1,250 .2597
498 - 534 .2550 1,300 .2581
534 - 587 .2500 1,350 .2566
587 - 646 .2463 1,400 .2551
646 - 711 .2426
711 - 782 .2389
782 - 860 .2352
860 - 946 .2315
946 - 1,041 .2278
1,041 - 1,145 .2241
1,145 - 1,260 .2204
over - 1,260 .2167
</TABLE>
