SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT (No. 2-69972)
UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No.
Post-Effective Amendment No. 66 [X]
and
REGISTRATION STATEMENT (No. 811-3114)
UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 66 [X]
Fidelity Select Portfolios
(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).
(X) on (April 29, 1999) 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).
( ) on ( ) 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
SELECT
PORTFOLIOS(REGISTERED TRADEMARK)
<TABLE>
<CAPTION>
<S> <C> <C>
FUND TRADING
NUMBER SYMBOL
AIR TRANSPORTATION PORTFOLIO 034 FSAIX
AUTOMOTIVE PORTFOLIO 502 FSAVX
BIOTECHNOLOGY PORTFOLIO 042 FBIOX
BROKERAGE AND INVESTMENT MANAGEMENT PORTFOLIO 068 FSLBX
BUSINESS SERVICES AND OUTSOURCING 353 FBSOX
CHEMICALS PORTFOLIO 069 FSCHX
COMPUTERS PORTFOLIO 007 FDCPX
CONSTRUCTION AND HOUSING PORTFOLIO 511 FSHOX
CONSUMER INDUSTRIES PORTFOLIO 517 FSCPX
CYCLICAL INDUSTRIES PORTFOLIO 515 FCYCF
DEFENSE AND AEROSPACE PORTFOLIO 067 FSDAX
DEVELOPING COMMUNICATIONS PORTFOLIO 518 FSDCX
ELECTRONICS PORTFOLIO 008 FSELX
ENERGY PORTFOLIO 060 FSENX
ENERGY SERVICE PORTFOLIO 043 FSESX
ENVIRONMENTAL SERVICES PORTFOLIO 516 FSLEX
FINANCIAL SERVICES PORTFOLIO 066 FIDSX
FOOD AND AGRICULTURE PORTFOLIO 009 FDFAX
GOLD PORTFOLIO 041 FSAGX
HEALTH CARE PORTFOLIO 063 FSPHX
HOME FINANCE PORTFOLIO 098 FSVLX
INDUSTRIAL EQUIPMENT PORTFOLIO 510 FSCGX
INDUSTRIAL MATERIALS PORTFOLIO 509 FSDPX
INSURANCE PORTFOLIO 045 FSPCX
LEISURE PORTFOLIO 062 FDLSX
MEDICAL DELIVERY PORTFOLIO 505 FSHCX
MEDICAL EQUIPMENT AND SYSTEMS PORTFOLIO 354 FSMEX
MULTIMEDIA PORTFOLIO 503 FBMPX
NATURAL GAS PORTFOLIO 513 FSNGX
NATURAL RESOURCES PORTFOLIO 514 FNATF
PAPER AND FOREST PRODUCTS PORTFOLIO 506 FSPFX
PRECIOUS METALS AND MINERALS PORTFOLIO 061 FDPMX
REGIONAL BANKS PORTFOLIO 507 FSRBX
RETAILING PORTFOLIO 046 FSRPX
SOFTWARE AND COMPUTER SERVICES PORTFOLIO 028 FSCSX
TECHNOLOGY PORTFOLIO 064 FSPTX
TELECOMMUNICATIONS PORTFOLIO 096 FSTCX
TRANSPORTATION PORTFOLIO 512 FSRFX
UTILITIES GROWTH PORTFOLIO 065 FSUTX
MONEY MARKET PORTFOLIO 085 FSLXX
</TABLE>
PROSPECTUS
APRIL 29, 1999
(FIDELITY_LOGO_GRAPHIC)(REGISTERED TRADEMARK)
82 DEVONSHIRE STREET, BOSTON, MA 02109
CONTENTS
FUND SUMMARY 3 INVESTMENT SUMMARY
17 PERFORMANCE
42 FEE TABLE
FUND BASICS 60 INVESTMENT DETAILS
73 VALUING SHARES
SHAREHOLDER INFORMATION 73 BUYING AND SELLING SHARES
81 EXCHANGING SHARES
81 ACCOUNT FEATURES AND POLICIES
84 DIVIDENDS AND CAPITAL GAINS
DISTRIBUTIONS
84 TAX CONSEQUENCES
FUND SERVICES 85 FUND MANAGEMENT
88 FUND DISTRIBUTION
APPENDIX 89 FINANCIAL HIGHLIGHTS
FUND SUMMARY
INVESTMENT SUMMARY
THE STOCK FUNDS
INVESTMENT OBJECTIVE
AIR TRANSPORTATION PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
Fidelity Management & Research Company (FMR)'s principal investment
strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the regional, national, and
international movement of passengers, mail, and freight via aircraft.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) AIR TRANSPORTATION INDUSTRY CONCENTRATION. The
air transportation industry can be significantly affected by
competition within the industry, domestic and foreign economies,
government regulation, and the price of fuel.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
AUTOMOTIVE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the manufacture, marketing or sale of
automobiles, trucks, specialty vehicles, parts, tires, and related
services.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) AUTOMOTIVE INDUSTRY CONCENTRATION. The automotive
industry is highly cyclical and can be significantly affected by labor
relations and fluctuating component prices.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
BIOTECHNOLOGY PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the research, development, and
manufacture of various biotechnological products, services, and
processes.
(small solid bullet) Potentially investing in securities of companies
that distribute biotechnological and biomedical products and companies
that benefit significantly from scientific and technological advances
in biotechnology.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) BIOTECHNOLOGY INDUSTRY CONCENTRATION. The
biotechnology industry can be significantly affected by patent
considerations, intense competition, rapid technological change and
obsolescence, and government regulation.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
BROKERAGE AND INVESTMENT MANAGEMENT PORTFOLIO seeks capital
appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in stock brokerage, commodity brokerage,
investment banking, tax-advantaged investment or investment sales,
investment management, or related investment advisory services.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) BROKERAGE AND INVESTMENT MANAGEMENT INDUSTRY
CONCENTRATION. The brokerage and investment management industry can be
significantly affected by stock and bond market activity, changes in
regulations, brokerage commission structure, and a competitive
environment combined with the high operating leverage inherent in
companies in this industry.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
BUSINESS SERVICES AND OUTSOURCING PORTFOLIO seeks capital
appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in providing business-related services
to companies and other organizations.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) BUSINESS SERVICES AND OUTSOURCING INDUSTRY
CONCENTRATION. The business services and outsourcing industry is
subject to continued demand for such services and can be significantly
affected by competitive pressures, such as technological developments,
fixed-rate pricing, and the ability to attract and retain skilled
employees.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
CHEMICALS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the research, development,
manufacture or marketing of products or services related to the
chemical process industries.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) CHEMICAL INDUSTRY CONCENTRATION. The chemical
industry can be significantly affected by intense competition, product
obsolescence, and government regulation and can be subject to risks
associated with the production, handling and disposal of hazardous
components.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
COMPUTERS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in research, design, development,
manufacture or distribution of products, processes or services that
relate to currently available or experimental hardware technology
within the computer industry.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) COMPUTER INDUSTRY CONCENTRATION. The computer
industry can be significantly affected by competitive pressures,
changing domestic and international demand, research and development
costs, and product obsolescence.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
CONSTRUCTION AND HOUSING PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the design and construction of
residential, commercial, industrial and public works facilities, as
well as companies engaged in the manufacture, supply, distribution or
sale of products or services to these construction industries.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) CONSTRUCTION AND HOUSING INDUSTRY CONCENTRATION.
The construction and housing industry can be significantly affected by
changes in government spending, interest rates, consumer confidence
and spending, taxation, demographic patterns, housing starts and the
level of new and existing home sales.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
CONSUMER INDUSTRIES PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the manufacture and distribution of
goods to consumers both domestically and internationally.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) CONSUMER INDUSTRY CONCENTRATION. The consumer
industries can be significantly affected by the performance of the
overall economy, interest rates, competition, consumer confidence and
spending, and changes in demographics and consumer tastes.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
CYCLICAL INDUSTRIES PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the research, development,
manufacture, distribution, supply, or sale of materials, equipment,
products or services related to cyclical industries.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) CYCLICAL INDUSTRY CONCENTRATION. Cyclical
industries can be significantly affected by general economic trends,
changes in consumer sentiment and spending, commodity prices,
legislation, government regulation and spending, import controls, and
worldwide competition, and can be subject to liability for
environmental damage, depletion of resources, and mandated
expenditures for safety and pollution control.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
DEFENSE AND AEROSPACE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the research, manufacture or sale of
products or services related to the defense or aerospace industries.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) DEFENSE AND AEROSPACE INDUSTRY CONCENTRATION. The
defense and aerospace industry can be significantly affected by
government defense and aerospace regulation and spending policies.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
DEVELOPING COMMUNICATIONS PORTFOLIO seeks capital appreciation.
The fund is subject to the following principal investment risks:
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the development, manufacture or sale
of emerging communications services or equipment.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) DEVELOPING COMMUNICATIONS INDUSTRY CONCENTRATION.
The developing communications industry can be significantly affected
by failure to obtain, or delays in obtaining, financing or regulatory
approval, intense competition, product compatibility, consumer
preferences, and rapid obsolescence.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
ELECTRONICS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the design, manufacture, or sale of
electronic components; equipment vendors to electronic component
manufacturers; electronic component distributors; and electronic
instruments and electronic systems vendors.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) ELECTRONICS INDUSTRY CONCENTRATION. The
electronics industry can be significantly affected by rapid
obsolescence, intense competition and global demand.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
ENERGY PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the energy field, including the
conventional areas of oil, gas, electricity and coal, and newer
sources of energy such as nuclear, geothermal, oil shale, and solar
power.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) ENERGY INDUSTRY CONCENTRATION. The energy
industry can be significantly affected by fluctuations in price and
supply of energy fuels, energy conservation, the success of
exploration projects, and tax and other government regulations.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
ENERGY SERVICE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the energy service field, including
those that provide services and equipment to the conventional areas of
oil, gas, electricity and coal, and newer sources of energy such as
nuclear, geothermal, oil shale, and solar power.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) ENERGY SERVICE INDUSTRY CONCENTRATION. The energy
service industry can be significantly affected by the supply of and
demand for specific products or services, the supply of and demand for
oil and gas, the price of oil and gas, exploration and production
spending, government regulation, world events, and economic
conditions.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
ENVIRONMENTAL SERVICES PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the research, development,
manufacture or distribution of products, processes or services related
to waste management or pollution control.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) ENVIRONMENTAL SERVICES INDUSTRY CONCENTRATION.
The environmental services industry can be significantly affected by
intense competition and legislation resulting in more strict
government regulations and enforcement policies and specific
expenditures for cleanup efforts, and can be subject to risks
associated with hazardous materials.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
FINANCIAL SERVICES PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in providing financial services to
consumers and industry.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) FINANCIAL SERVICES INDUSTRY CONCENTRATION. The
financial services industries are subject to extensive government
regulation and relatively rapid change due to increasingly blurred
distinctions between service segments, and can be significantly
affected by availability and cost of capital funds, changes in
interest rates, and price competition.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
FOOD AND AGRICULTURE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the manufacture, sale, or
distribution of food and beverage products, agricultural products, and
products related to the development of new food technologies.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) FOOD AND AGRICULTURE INDUSTRY CONCENTRATION. The
food and agriculture industry can be significantly affected by
demographic and product trends, food fads, marketing campaigns,
environmental factors and government regulation.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
GOLD PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks and in
certain precious metals.
(small solid bullet) Investing primarily in companies engaged in
exploration, mining, processing, or dealing in gold, or to a lesser
degree, in silver, platinum, diamonds, or other precious metals and
minerals.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in gold-related activities, and in gold
bullion or coins.
(small solid bullet) Potentially investing in other precious metals,
securities indexed to the price of precious metals, and securities of
companies that manufacture and distribute precious metal and minerals
products (such as jewelry, watches, and metal foil and leaf) and
companies that invest in other companies engaged in gold and other
precious metal and mineral-related activities.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) GOLD INDUSTRY CONCENTRATION. The gold industry
can be significantly affected by international monetary and political
developments such as currency devaluations or revaluations, central
bank movements, economic and social conditions within a country, trade
imbalances, or trade or currency restrictions between countries.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
HEALTH CARE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the design, manufacture, or sale of
products or services used for or in connection with health care or
medicine.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) HEALTH CARE INDUSTRY CONCENTRATION. The health
care industries are subject to government regulation and government
approval of products and services, which could have a significant
effect on price and availability, and can be significantly affected by
rapid obsolescence.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
HOME FINANCE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in investing in real estate, usually
through mortgages and other consumer-related loans.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) HOME FINANCE INDUSTRY CONCENTRATION. The home
finance industry can be significantly affected by regulatory changes,
interest rate movements, home mortgage demand, refinancing activity,
and residential delinquency trends.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
INDUSTRIAL EQUIPMENT PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the manufacture, distribution, or
service of products and equipment for the industrial sector, including
integrated producers of capital equipment, parts suppliers, and
subcontractors.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) INDUSTRIAL EQUIPMENT INDUSTRY CONCENTRATION. The
industrial equipment industry can be significantly affected by overall
capital spending levels, economic cycles, technical obsolescence,
labor relations, and government regulations.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
INDUSTRIAL MATERIALS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the manufacture, mining, processing,
or distribution of raw materials and intermediate goods used in the
industrial sector.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) INDUSTRIAL MATERIALS INDUSTRY CONCENTRATION. The
industrial materials industry can be significantly affected by the
level and volatility of commodity prices, the exchange value of the
dollar, import controls, worldwide competition, liability for
environmental damage, depletion of resources, and mandated
expenditures for safety and pollution control.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
INSURANCE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in underwriting, reinsuring, selling,
distributing, or placing of property and casualty, life, or health
insurance.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) INSURANCE INDUSTRY CONCENTRATION. The insurance
industry is subject to extensive government regulation and can be
significantly affected by interest rates, general economic conditions,
and price and marketing competition. Different segments of the
industry can be significantly affected by natural disasters, mortality
and morbidity rates, and environmental clean-up.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
LEISURE PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the design, production, or
distribution of goods or services in the leisure industries.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) LEISURE INDUSTRY CONCENTRATION. The leisure
industry can be significantly affected by changing consumer tastes,
intense competition, technological developments and government
regulation.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
MEDICAL DELIVERY PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the ownership or management of
hospitals, nursing homes, health maintenance organizations, and other
companies specializing in the delivery of health care services.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) MEDICAL DELIVERY INDUSTRY CONCENTRATION. The
medical delivery industry is subject to extensive government
regulation and can be significantly affected by government
reimbursement for medical expenses, rising costs of medical products
and services, a shift away from traditional health insurance, and an
increased emphasis on outpatient services.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
MEDICAL EQUIPMENT AND SYSTEMS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in research, development, manufacture,
distribution, supply or sale of medical equipment and devices and
related technologies.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) MEDICAL EQUIPMENT AND SYSTEMS INDUSTRY
CONCENTRATION. The medical equipment and systems industry can be
significantly affected by patent considerations, rapid technological
change and obsolescence, government regulation, and government
reimbursement for medical expenses.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
MULTIMEDIA PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the development, production, sale,
and distribution of goods or services used in the broadcast and media
industries.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) MULTIMEDIA INDUSTRY CONCENTRATION. The multimedia
industry can be significantly affected by the federal deregulation of
cable and broadcasting, competitive pressures and government
regulation.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
NATURAL GAS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the production, transmission, and
distribution of natural gas, and involved in the exploration of
potential natural gas sources, as well as those companies that provide
services and equipment to natural gas producers, refineries,
cogeneration facilities, converters, and distributors.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) NATURAL GAS INDUSTRY CONCENTRATION. The natural
gas industry is subject to changes in price and supply of energy
sources and can be significantly affected by events relating to
international politics, energy conservation, the success of energy
source exploration projects, and tax and other government regulations.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
NATURAL RESOURCES PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks and in
certain precious metals.
(small solid bullet) Investing primarily in companies that own or
develop natural resources, or supply goods and services to such
companies.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in owning or developing natural
resources, or supplying goods and services to such companies, and in
precious metals.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) NATURAL RESOURCES INDUSTRY CONCENTRATION. The
natural resources industries can be significantly affected by events
relating to international political and economic developments, energy
conservation, the success of exploration projects, and tax and other
government regulations.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
PAPER AND FOREST PRODUCTS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the manufacture, research, sale, or
distribution of paper products, packaging products, building
materials, and other products related to the paper and forest products
industry.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) PAPER AND FOREST PRODUCTS INDUSTRY CONCENTRATION.
The paper and forest products industry can be significantly affected
by the health of the economy, worldwide production capacity, and
interest rates.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
PRECIOUS METALS AND MINERALS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks and in
certain precious metals.
(small solid bullet) Investing primarily in companies engaged in
exploration, mining, processing, or dealing in gold, silver, platinum,
diamonds, or other precious metals and minerals.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in exploration, mining, processing, or
dealing in gold, silver, platinum, diamonds, or other precious metals
and minerals, and in precious metals.
(small solid bullet) Potentially investing in securities of companies
that invest in other companies engaged in gold and other precious
metal and mineral-related activities.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) PRECIOUS METALS AND MINERALS INDUSTRY
CONCENTRATION. The precious metals and minerals industry can be
significantly affected by international political and monetary
developments such as currency devaluations or revaluations, economic
and social conditions within a country, trade imbalances, or trade or
currency restrictions between countries.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
REGIONAL BANKS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in accepting deposits and making
commercial and principally non-mortgage consumer loans (these
companies concentrate their operations in a specific part of the
country).
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) REGIONAL BANKS INDUSTRY CONCENTRATION. The
regional banking industry can be significantly affected by legislation
that would reduce the separation between commercial and investment
banking businesses and could change capitalization requirements and
the savings and loan industry and increase competition, and by changes
in general economic conditions and interest rates.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
RETAILING PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in merchandising finished goods and
services primarily to individual consumers.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) RETAIL INDUSTRY CONCENTRATION. The retail
industry can be significantly affected by consumer confidence and
spending, intense competition, and changing consumer tastes.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
SOFTWARE AND COMPUTER SERVICES PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in research, design, production or
distribution of products or processes that relate to software or
information-based services.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) SOFTWARE AND COMPUTER SERVICES INDUSTRY
CONCENTRATION. The software and computer services industry can be
significantly affected by competitive pressures, which can lead to
aggressive pricing and slower selling cycles.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
TECHNOLOGY PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in offering, using or developing
products, processes or services that will provide or will benefit
significantly from technological advances and improvements.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) TECHNOLOGY INDUSTRY CONCENTRATION. The technology
industries can be significantly affected by obsolescence of existing
technology, short product cycles, falling prices and profits, and
competition from new market entrants.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
TELECOMMUNICATIONS PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the development, manufacture, or sale
of communications services or communications equipment.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) TELECOMMUNICATIONS INDUSTRY CONCENTRATION. The
telecommunications industry is subject to government regulation of
rates of return and services that may be offered and can be
significantly affected by intense competition.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
TRANSPORTATION PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in providing transportation services or
companies principally engaged in the design, manufacture,
distribution, or sale of transportation equipment.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) TRANSPORTATION INDUSTRY CONCENTRATION. The
transportation industry can be significantly affected by changes in
the economy, fuel prices, labor relations, insurance costs and
government regulation.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
INVESTMENT OBJECTIVE
UTILITIES GROWTH PORTFOLIO seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing primarily in common stocks.
(small solid bullet) Investing at least 80% of assets in securities of
companies principally engaged in the public utilities industry and
companies deriving a majority of their revenues from their public
utility operations.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
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) 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) UTILITIES INDUSTRY CONCENTRATION. The utilities
industries can be significantly affected by government regulation,
financing difficulties, supply and demand of services or fuel, and
natural resource conservation.
(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. The value of securities of smaller
issuers can be more volatile than that of larger issuers.
In addition, each stock fund (except Financial Services, Home Finance
and Regional Banks) is considered non-diversified and can invest a
greater portion of assets in securities of individual issuers than a
diversified fund. As a result, changes in the market value of a single
issuer could cause greater fluctuations in share price than would
occur in a more diversified fund.
An investment in a stock 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 a stock fund, they could be worth more or
less than what you paid for them.
THE MONEY MARKET FUND
INVESTMENT OBJECTIVE
MONEY MARKET PORTFOLIO seeks to provide high current income,
consistent with preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing in U.S. dollar-denominated money market
securities, including U.S. Government securities and repurchase
agreements, and entering into reverse repurchase agreements.
(small solid bullet) Investing at least 80% of assets in money market
instruments.
(small solid bullet) Investing more than 25% of total assets in the
financial services industry.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) FOREIGN EXPOSURE. Entities located in foreign
countries can be affected by adverse political, regulatory, market or
economic developments in those countries.
(small solid bullet) FINANCIAL SERVICES EXPOSURE. Changes in
government regulation and interest rates a nd economic downturns
can have a significant negative affect on issuers in the financial
services sector.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
PERFORMANCE
The following information illustrates the changes in the funds'
performance from year to year and compares the stock funds'
performance to the performance of a market index and an additional
index over various periods of time. Returns are based on past results
and are not an indication of future performance.
Because Business Services and Outsourcing and Medical Equipment and
Systems were new when this prospectus was printed, their performance
history is not included. Performance history will be available for
Business Services and Outsourcing and Medical Equipment and Systems
after each fund has been in operation for one calendar year.
YEAR-BY-YEAR RETURNS
The returns in the chart do not include the effect of each fund's
front-end sales charge. If the effect of the sales charge was
reflected, returns would be lower than those shown.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
AIR TRANSPORTATION
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
26.33% -18.18% 37.06% 6.57% 30.89% -21.74% 59.54% 1.25% 31.14% 6.42%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 26.33
Row: 2, Col: 1, Value: -18.18
Row: 3, Col: 1, Value: 37.06
Row: 4, Col: 1, Value: 6.57
Row: 5, Col: 1, Value: 30.89
Row: 6, Col: 1, Value: -21.74
Row: 7, Col: 1, Value: 59.54
Row: 8, Col: 1, Value: 1.25
Row: 9, Col: 1, Value: 31.14
Row: 10, Col: 1, Value: 6.42
DURING THE PERIODS SHOWN IN THE CHART FOR AIR TRANSPORTATION, THE
HIGHEST RETURN FOR A QUARTER WAS 23.90 % (QUARTER ENDING
MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS
- -26.72 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR AIR TRANSPORTATION
WAS 14.8 2%.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
AUTOMOTIVE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
4.10% -6.72% 37.33% 41.61% 35.38% -12.75% 13.43% 16.07% 16.78% 4.94%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 4.1
Row: 2, Col: 1, Value: -6.72
Row: 3, Col: 1, Value: 37.33
Row: 4, Col: 1, Value: 41.61
Row: 5, Col: 1, Value: 35.38
Row: 6, Col: 1, Value: -12.75
Row: 7, Col: 1, Value: 13.43
Row: 8, Col: 1, Value: 16.07
Row: 9, Col: 1, Value: 16.78
Row: 10, Col: 1, Value: 4.94
DURING THE PERIODS SHOWN IN THE CHART FOR AUTOMOTIVE, THE HIGHEST
RETURN FOR A QUARTER WAS 24.59 % (QUARTER ENDING MARCH 31,
1992 ) AND THE LOWEST RETURN FOR A QUARTER WAS -22.31 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR AUTOMOTIVE WAS
-7.29% .
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
BIOTECHNOLOGY
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
43.93% 44.35% 99.05% -10.34% 0.70% -18.18% 49.10% 5.61% 15.27% 29.72%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 43.93
Row: 2, Col: 1, Value: 44.34999999999999
Row: 3, Col: 1, Value: 99.05
Row: 4, Col: 1, Value: -10.34
Row: 5, Col: 1, Value: 0.7000000000000001
Row: 6, Col: 1, Value: -18.18
Row: 7, Col: 1, Value: 49.1
Row: 8, Col: 1, Value: 5.609999999999999
Row: 9, Col: 1, Value: 15.27
Row: 10, Col: 1, Value: 29.72
DURING THE PERIODS SHOWN IN THE CHART FOR BIOTECHNOLOGY, THE HIGHEST
RETURN FOR A QUARTER WAS 40.42 % (QUARTER ENDING MARCH 31,
1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS -19.25 %
(QUARTER ENDING MARCH 31, 1993 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR BIOTECHNOLOGY WAS
9.08 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
BROKERAGE AND INVESTMENT
MANAGEMENT
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
14.06% -16.18% 82.26% 5.12% 49.33% -17.27% 23.59% 39.66% 62.32% 5.67%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 14.06
Row: 2, Col: 1, Value: -16.18
Row: 3, Col: 1, Value: 82.26000000000001
Row: 4, Col: 1, Value: 5.119999999999999
Row: 5, Col: 1, Value: 49.33
Row: 6, Col: 1, Value: -17.27
Row: 7, Col: 1, Value: 23.59
Row: 8, Col: 1, Value: 39.66
Row: 9, Col: 1, Value: 62.32
Row: 10, Col: 1, Value: 5.67
DURING THE PERIODS SHOWN IN THE CHART FOR BROKERAGE AND INVESTMENT
MANAGEMENT, THE HIGHEST RETURN FOR A QUARTER WAS 31.28 %
(QUARTER ENDING MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A
QUARTER WAS -33.12 % (QUARTER ENDIN G SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR BROKERAGE AND
INVESTMENT MANAGEMENT WAS 15.47% .
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CHEMICALS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
17.31% -4.13% 38.66% 8.90% 12.76% 14.78% 21.45% 21.52% 16.48% -15.90%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 17.31
Row: 2, Col: 1, Value: -4.13
Row: 3, Col: 1, Value: 38.66
Row: 4, Col: 1, Value: 8.9
Row: 5, Col: 1, Value: 12.76
Row: 6, Col: 1, Value: 14.78
Row: 7, Col: 1, Value: 21.45
Row: 8, Col: 1, Value: 21.52
Row: 9, Col: 1, Value: 16.48
Row: 10, Col: 1, Value: -15.9
DURING THE PERIODS SHOWN IN THE CHART FOR CHEMICALS, THE HIGHEST
RETURN FOR A QUARTER WAS 17.65 % (QUARTER ENDING MARCH 31,
1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS -19.95 %
(QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR CHEMICALS WAS
- - 1.38% .
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
COMPUTERS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
6.84% 18.41% 30.75% 21.96% 28.87% 20.45% 51.83% 31.62% 0.10% 96.37%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 6.84
Row: 2, Col: 1, Value: 18.41
Row: 3, Col: 1, Value: 30.75
Row: 4, Col: 1, Value: 21.96
Row: 5, Col: 1, Value: 28.87
Row: 6, Col: 1, Value: 20.45
Row: 7, Col: 1, Value: 51.83
Row: 8, Col: 1, Value: 31.62
Row: 9, Col: 1, Value: 0.1
Row: 10, Col: 1, Value: 96.36999999999999
DURING THE PERIODS SHOWN IN THE CHART FOR COMPUTERS, THE HIGHEST
RETURN FOR A QUARTER WAS 39.44 % (QUARTER ENDING DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -27.00 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR COMPUTERS WAS
13.50% .
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CONSTRUCTION AND HOUSING
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
16.60% -9.64% 41.31% 18.71% 33.61% -15.94% 28.78% 13.21% 29.83% 22.84%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 16.6
Row: 2, Col: 1, Value: -9.639999999999999
Row: 3, Col: 1, Value: 41.31
Row: 4, Col: 1, Value: 18.71
Row: 5, Col: 1, Value: 33.61
Row: 6, Col: 1, Value: -15.94
Row: 7, Col: 1, Value: 28.78
Row: 8, Col: 1, Value: 13.21
Row: 9, Col: 1, Value: 29.83
Row: 10, Col: 1, Value: 22.84
DURING THE PERIODS SHOWN IN THE CHART FOR CONSTRUCTION AND HOUSING,
THE HIGHEST RETURN FOR A QUARTER WAS 29.68 % (QUARTER ENDING
DECEMBER 31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-25.81 % (QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR CONSTRUCTION AND
HOUSING WAS - 11.39% .
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CONSUMER INDUSTRIES
Calendar Years 1991 1992 1993 1994 1995 1996 1997 1998
38.53% 8.56% 24.67% -7.07% 28.30% 13.15% 38.06% 27.49%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: nil
Row: 2, Col: 1, Value: nil
Row: 3, Col: 1, Value: 38.53
Row: 4, Col: 1, Value: 8.560000000000001
Row: 5, Col: 1, Value: 24.67
Row: 6, Col: 1, Value: -7.07
Row: 7, Col: 1, Value: 28.3
Row: 8, Col: 1, Value: 13.15
Row: 9, Col: 1, Value: 38.06
Row: 10, Col: 1, Value: 27.49
DURING THE PERIODS SHOWN IN THE CHART FOR CONSUMER INDUSTRIES, THE
HIGHEST RETURN FOR A QUARTER WAS 27.07 % (QUARTER ENDING
DECEMBER 31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-15.37 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR CONSUMER INDUSTRIES
WAS 2.51%.
CYCLICAL INDUSTRIES
Calendar Year 1998
8.77%
Percentage (%)
Row: 1, Col: 1, Value: nil
Row: 2, Col: 1, Value: 0.0
Row: 3, Col: 1, Value: 0.0
Row: 4, Col: 1, Value: 0.0
Row: 5, Col: 1, Value: 0.0
Row: 6, Col: 1, Value: 0.0
Row: 7, Col: 1, Value: 0.0
Row: 8, Col: 1, Value: 0.0
Row: 9, Col: 1, Value: 0.0
Row: 10, Col: 1, Value: 8.77
DURING THE PERIOD SHOWN IN THE CHART FOR CYCLICAL INDUSTRIES, THE
HIGHEST RETURN FOR A QUARTER WAS 17.39 % (QUARTER ENDING
DECEMBER 31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-19.87 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR CYCLICAL INDUSTRIES
WAS -3.20%.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
DEFENSE AND AEROSPACE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
8.81% -4.58% 26.93% 0.00% 28.86% 1.76% 47.36% 25.03% 23.57% 4.34%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 8.810000000000001
Row: 2, Col: 1, Value: -4.58
Row: 3, Col: 1, Value: 26.93
Row: 4, Col: 1, Value: 0.0
Row: 5, Col: 1, Value: 28.86
Row: 6, Col: 1, Value: 1.76
Row: 7, Col: 1, Value: 47.36
Row: 8, Col: 1, Value: 25.03
Row: 9, Col: 1, Value: 23.57
Row: 10, Col: 1, Value: 4.34
DURING THE PERIODS SHOWN IN THE CHART FOR DEFENSE AND AEROSPACE, THE
HIGHEST RETURN FOR A QUARTER WAS 23.08 % (QUARTER ENDING
SEPTEMBER 30, 1997 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-18.25 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR DEFENSE AND AEROSPACE
WAS -0.18 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
DEVELOPING COMMUNICATIONS
Calendar Years 1991 1992 1993 1994 1995 1996 1997 1998
61.39% 17.21% 31.77% 15.14% 17.37% 14.55% 6.04% 67.68%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: nil
Row: 2, Col: 1, Value: nil
Row: 3, Col: 1, Value: 61.39
Row: 4, Col: 1, Value: 17.21
Row: 5, Col: 1, Value: 31.77
Row: 6, Col: 1, Value: 15.14
Row: 7, Col: 1, Value: 17.37
Row: 8, Col: 1, Value: 14.55
Row: 9, Col: 1, Value: 6.04
Row: 10, Col: 1, Value: 67.67999999999999
DURING THE PERIODS SHOWN IN THE CHART FOR DEVELOPING COMMUNICATIONS,
THE HIGHEST RETURN FOR A QUARTER WAS 48.91 % (QUARTER ENDING
DECEMBER 31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-15.48 % (QUARTER ENDING MARCH 31, 1997 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR DEVELOPING
COMMUNICATIONS WAS 25.57 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ELECTRONICS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
15.67% 5.81% 35.29% 27.44% 32.08% 17.17% 68.97% 41.72% 13.72% 51.12%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 15.67
Row: 2, Col: 1, Value: 5.81
Row: 3, Col: 1, Value: 35.29000000000001
Row: 4, Col: 1, Value: 27.44
Row: 5, Col: 1, Value: 32.08
Row: 6, Col: 1, Value: 17.17
Row: 7, Col: 1, Value: 68.97
Row: 8, Col: 1, Value: 41.72000000000001
Row: 9, Col: 1, Value: 13.72
Row: 10, Col: 1, Value: 51.12000000000001
DURING THE PERIODS SHOWN IN THE CHART FOR ELECTRONICS, THE HIGHEST
RETURN FOR A QUARTER WAS 56.77 % (QUARTER ENDING DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -31.76 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR ELECTRONICS WAS
5.80 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ENERGY
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
42.83% -4.49% 0.04% -2.39% 19.15% 0.41% 21.38% 32.47% 10.28% -14.74%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 42.83
Row: 2, Col: 1, Value: -4.49
Row: 3, Col: 1, Value: 0.04000000000000001
Row: 4, Col: 1, Value: -2.93
Row: 5, Col: 1, Value: 19.15
Row: 6, Col: 1, Value: 0.41
Row: 7, Col: 1, Value: 21.38
Row: 8, Col: 1, Value: 32.47
Row: 9, Col: 1, Value: 10.28
Row: 10, Col: 1, Value: -14.74
DURING THE PERIODS SHOWN IN THE CHART FOR ENERGY, THE HIGHEST RETURN
FOR A QUARTER WAS 16.27 % (QUARTER ENDING MARCH 31, 1993 )
AND THE LOWEST RETURN FOR A QUARTER WAS -11.75 % (QUARTER ENDING
SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR ENERGY WAS
11.07 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ENERGY SERVICE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
59.44% 1.75% -23.48% 3.43% 20.96% 0.57% 40.87% 49.08% 51.87% -49.72%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 59.44
Row: 2, Col: 1, Value: 1.75
Row: 3, Col: 1, Value: -23.48
Row: 4, Col: 1, Value: 3.43
Row: 5, Col: 1, Value: 20.96
Row: 6, Col: 1, Value: 0.5700000000000001
Row: 7, Col: 1, Value: 40.87
Row: 8, Col: 1, Value: 49.08
Row: 9, Col: 1, Value: 51.87
Row: 10, Col: 1, Value: -49.72000000000001
DURING THE PERIODS SHOWN IN THE CHART FOR ENERGY SERVICE, THE HIGHEST
RETURN FOR A QUARTER WAS 36.86 % (QUARTER ENDING SEPTEMBER
30, 1997 ) AND THE LOWEST RETURN FOR A QUARTER WAS -34.78 %
(QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR ENERGY SERVICE WAS
27.02 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ENVIRONMENTAL SERVICES
Calendar Years 1990 1991 1992 1993 1994 1995 1996 1997 1998
-2.48% 7.66% -1.37% -0.62% -9.55% 26.13% 15.61% 17.87% -16.96%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: nil
Row: 2, Col: 1, Value: -2.48
Row: 3, Col: 1, Value: 7.659999999999999
Row: 4, Col: 1, Value: -1.37
Row: 5, Col: 1, Value: -0.6200000000000001
Row: 6, Col: 1, Value: -9.550000000000001
Row: 7, Col: 1, Value: 26.13
Row: 8, Col: 1, Value: 15.61
Row: 9, Col: 1, Value: 17.87
Row: 10, Col: 1, Value: -16.96
DURING THE PERIODS SHOWN IN THE CHART FOR ENVIRONMENTAL SERVICES, THE
HIGHEST RETURN FOR A QUARTER WAS 13.75 % (QUARTER ENDING
MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-19.57 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR ENVIRONMENTAL
SERVICES WAS -8.78 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL SERVICES
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
19.34% -24.33% 61.63% 42.82% 17.55% -3.65% 47.34% 32.12% 41.98% 14.13%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 19.34
Row: 2, Col: 1, Value: -24.33
Row: 3, Col: 1, Value: 61.63
Row: 4, Col: 1, Value: 42.82
Row: 5, Col: 1, Value: 17.55
Row: 6, Col: 1, Value: -3.65
Row: 7, Col: 1, Value: 47.34
Row: 8, Col: 1, Value: 32.12000000000001
Row: 9, Col: 1, Value: 41.98
Row: 10, Col: 1, Value: 14.13
DURING THE PERIODS SHOWN IN THE CHART FOR FINANCIAL SERVICES, THE
HIGHEST RETURN FOR A QUARTER WAS 27.43 % (QUARTER ENDING
MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-29.89 % (QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR FINANCIAL SERVICES
WAS 5.74 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOOD AND AGRICULTURE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
38.87% 9.33% 34.09% 6.03% 8.82% 6.09% 36.64% 13.35% 30.34% 15.69%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 38.87
Row: 2, Col: 1, Value: 9.33
Row: 3, Col: 1, Value: 34.09
Row: 4, Col: 1, Value: 6.03
Row: 5, Col: 1, Value: 8.82
Row: 6, Col: 1, Value: 6.09
Row: 7, Col: 1, Value: 36.64
Row: 8, Col: 1, Value: 13.35
Row: 9, Col: 1, Value: 30.34
Row: 10, Col: 1, Value: 15.69
DURING THE PERIODS SHOWN IN THE CHART FOR FOOD AND AGRICULTURE, THE
HIGHEST RETURN FOR A QUARTER WAS 16.88 % (QUARTER ENDING
DECEMBER 31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-10.29 % (QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR FOOD AND AGRICULTURE
WAS -8.12 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
GOLD
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
22.04% -17.20% -6.14% -3.09% 78.68% -15.46% 11.20% 19.92% -39.39% -8.64%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 22.04
Row: 2, Col: 1, Value: -17.2
Row: 3, Col: 1, Value: -6.14
Row: 4, Col: 1, Value: -3.09
Row: 5, Col: 1, Value: 78.67999999999999
Row: 6, Col: 1, Value: -15.46
Row: 7, Col: 1, Value: 11.2
Row: 8, Col: 1, Value: 19.92
Row: 9, Col: 1, Value: -39.39
Row: 10, Col: 1, Value: -8.639999999999999
DURING THE PERIODS SHOWN IN THE CHART FOR GOLD, THE HIGHEST RETURN FOR
A QUARTER WAS 32.47 % (QUARTER ENDING JUNE 30, 1993 ) AND
THE LOWEST RETURN FOR A QUARTER WAS -32.11 % (QUARTER ENDING
DECEMBER 31, 1997 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR GOLD WAS
-6.09 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
HEALTH CARE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
42.49% 24.32% 83.69% -17.43% 2.42% 21.46% 45.86% 15.46% 31.15% 41.28%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 42.49
Row: 2, Col: 1, Value: 24.32
Row: 3, Col: 1, Value: 83.69
Row: 4, Col: 1, Value: -17.43
Row: 5, Col: 1, Value: 2.42
Row: 6, Col: 1, Value: 21.46
Row: 7, Col: 1, Value: 45.86
Row: 8, Col: 1, Value: 15.46
Row: 9, Col: 1, Value: 31.15
Row: 10, Col: 1, Value: 41.28
DURING THE PERIODS SHOWN IN THE CHART FOR HEALTH CARE, THE HIGHEST
RETURN FOR A QUARTER WAS 34.45 % (QUARTER ENDING MARCH 31,
1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS -13.15 %
(QUARTER ENDING MARCH 31, 1992 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR HEALTH CARE WAS
1.99 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
HOME FINANCE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
9.33% -15.08% 64.61% 57.85% 27.29% 2.68% 53.49% 36.88% 45.75% -14.81%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 9.33
Row: 2, Col: 1, Value: -15.08
Row: 3, Col: 1, Value: 64.61
Row: 4, Col: 1, Value: 57.84999999999999
Row: 5, Col: 1, Value: 27.29
Row: 6, Col: 1, Value: 2.68
Row: 7, Col: 1, Value: 53.49
Row: 8, Col: 1, Value: 36.88
Row: 9, Col: 1, Value: 45.75
Row: 10, Col: 1, Value: -14.81
DURING THE PERIODS SHOWN IN THE CHART FOR HOME FINANCE, THE HIGHEST
RETURN FOR A QUARTER WAS 30.19 % (QUARTER ENDING MARCH 31,
1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS -25.76 %
(QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR HOME FINANCE WAS
-0.62 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INDUSTRIAL EQUIPMENT
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
17.95% -15.51% 26.84% 11.34% 43.33% 3.13% 27.81% 26.71% 18.55% 12.67%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 17.95
Row: 2, Col: 1, Value: -15.51
Row: 3, Col: 1, Value: 26.84
Row: 4, Col: 1, Value: 11.34
Row: 5, Col: 1, Value: 43.33
Row: 6, Col: 1, Value: 3.13
Row: 7, Col: 1, Value: 27.81
Row: 8, Col: 1, Value: 26.71
Row: 9, Col: 1, Value: 18.55
Row: 10, Col: 1, Value: 12.67
DURING THE PERIODS SHOWN IN THE CHART FOR INDUSTRIAL EQUIPMENT, THE
HIGHEST RETURN FOR A QUARTER WAS 20.08 % (QUARTER ENDING
MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-29.18 % (QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR INDUSTRIAL EQUIPMENT
WAS -1.47 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INDUSTRIAL MATERIALS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
4.45% -17.17% 35.81% 12.37% 21.38% 8.19% 15.39% 14.01% 1.75% -11.02%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 4.45
Row: 2, Col: 1, Value: -17.17
Row: 3, Col: 1, Value: 35.81
Row: 4, Col: 1, Value: 12.37
Row: 5, Col: 1, Value: 21.38
Row: 6, Col: 1, Value: 8.19
Row: 7, Col: 1, Value: 15.39
Row: 8, Col: 1, Value: 14.01
Row: 9, Col: 1, Value: 1.75
Row: 10, Col: 1, Value: -11.02
DURING THE PERIODS SHOWN IN THE CHART FOR INDUSTRIAL MATERIALS, THE
HIGHEST RETURN FOR A QUARTER WAS 12.69 % (QUARTER ENDING
MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-21.26 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR INDUSTRIAL MATERIALS
WAS 0.10 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INSURANCE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
37.83% -9.81% 36.68% 22.50% 8.18% -0.35% 34.81% 23.71% 42.47% 20.32%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 37.83
Row: 2, Col: 1, Value: -9.810000000000001
Row: 3, Col: 1, Value: 36.68
Row: 4, Col: 1, Value: 22.5
Row: 5, Col: 1, Value: 8.18
Row: 6, Col: 1, Value: -0.35
Row: 7, Col: 1, Value: 34.81
Row: 8, Col: 1, Value: 23.71
Row: 9, Col: 1, Value: 42.47
Row: 10, Col: 1, Value: 20.32
DURING THE PERIODS SHOWN IN THE CHART FOR INSURANCE, THE HIGHEST
RETURN FOR A QUARTER WAS 23.68 % (QUARTER ENDING MARCH 31,
1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS -19.37 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR INSURANCE WAS
0.97 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
LEISURE
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
31.21% -22.29% 32.94% 16.23% 39.55% -6.84% 26.96% 13.41% 41.29% 37.92%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 31.21
Row: 2, Col: 1, Value: -22.29
Row: 3, Col: 1, Value: 32.94
Row: 4, Col: 1, Value: 16.23
Row: 5, Col: 1, Value: 39.55
Row: 6, Col: 1, Value: -6.84
Row: 7, Col: 1, Value: 26.96
Row: 8, Col: 1, Value: 13.41
Row: 9, Col: 1, Value: 41.29000000000001
Row: 10, Col: 1, Value: 37.92
DURING THE PERIODS SHOWN IN THE CHART FOR LEISURE, THE HIGHEST RETURN
FOR A QUARTER WAS 32.19 % (QUARTER ENDING DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -22.70 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR LEISURE WAS
16.40 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MEDICAL DELIVERY
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
58.02% 16.26% 77.83% -13.19% 5.52% 19.84% 32.18% 11.00% 20.14% -6.16%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 58.02
Row: 2, Col: 1, Value: 16.26
Row: 3, Col: 1, Value: 77.83
Row: 4, Col: 1, Value: -13.19
Row: 5, Col: 1, Value: 5.52
Row: 6, Col: 1, Value: 19.84
Row: 7, Col: 1, Value: 32.18
Row: 8, Col: 1, Value: 11.0
Row: 9, Col: 1, Value: 20.14
Row: 10, Col: 1, Value: -6.159999999999999
DURING THE PERIODS SHOWN IN THE CHART FOR MEDICAL DELIVERY, THE
HIGHEST RETURN FOR A QUARTER WAS 41.61 % (QUARTER ENDING
MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-26.26 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR MEDICAL DELIVERY WAS
-21.50 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MULTIMEDIA
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
32.54% -26.21% 37.85% 21.50% 38.02% 4.00% 33.67% 1.07% 30.93% 35.69%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 32.54
Row: 2, Col: 1, Value: -26.21
Row: 3, Col: 1, Value: 37.84999999999999
Row: 4, Col: 1, Value: 21.5
Row: 5, Col: 1, Value: 38.02
Row: 6, Col: 1, Value: 4.0
Row: 7, Col: 1, Value: 33.67
Row: 8, Col: 1, Value: 1.07
Row: 9, Col: 1, Value: 30.93
Row: 10, Col: 1, Value: 35.69000000000001
DURING THE PERIODS SHOWN IN THE CHART FOR MULTIMEDIA, THE HIGHEST
RETURN FOR A QUARTER WAS 27.35 % (QUARTER ENDING DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -24.82 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR MULTIMEDIA WAS
11.37 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NATURAL GAS
Calendar Years 1994 1995 1996 1997 1998
-6.84% 30.38% 34.32% -8.06% -12.40%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: nil
Row: 2, Col: 1, Value: nil
Row: 3, Col: 1, Value: nil
Row: 4, Col: 1, Value: nil
Row: 5, Col: 1, Value: nil
Row: 6, Col: 1, Value: -6.84
Row: 7, Col: 1, Value: 30.38
Row: 8, Col: 1, Value: 34.32
Row: 9, Col: 1, Value: -8.060000000000001
Row: 10, Col: 1, Value: -12.4
DURING THE PERIODS SHOWN IN THE CHART FOR NATURAL GAS, THE HIGHEST
RETURN FOR A QUARTER WAS 16.45 % (QUARTER ENDING SEPTEMBER
30, 1997 ) AND THE LOWEST RETURN FOR A QUARTER WAS -16.04 %
(QUARTER ENDING MARCH 31, 1997 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR NATURAL GAS WAS
7.20 %.
NATURAL RESOURCES
Calendar Year 1998
-16.57%
Percentage (%)
Row: 1, Col: 1, Value: nil
Row: 2, Col: 1, Value: nil
Row: 3, Col: 1, Value: nil
Row: 4, Col: 1, Value: nil
Row: 5, Col: 1, Value: nil
Row: 6, Col: 1, Value: nil
Row: 7, Col: 1, Value: nil
Row: 8, Col: 1, Value: nil
Row: 9, Col: 1, Value: nil
Row: 10, Col: 1, Value: -16.57
DURING THE PERIOD SHOWN IN THE CHART FOR NATURAL RESOURCES, THE
HIGHEST RETURN FOR A QUARTER WAS 4.82 % (QUARTER ENDING MARCH
31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -11.34 %
(QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR NATURAL RESOURCES WAS
10.51 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PAPER AND FOREST PRODUCTS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
4.08% -15.11% 34.77% 12.05% 18.55% 14.14% 21.91% 7.07% 9.35% -7.89%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 4.08
Row: 2, Col: 1, Value: -15.11
Row: 3, Col: 1, Value: 34.77
Row: 4, Col: 1, Value: 12.05
Row: 5, Col: 1, Value: 18.55
Row: 6, Col: 1, Value: 14.14
Row: 7, Col: 1, Value: 21.91
Row: 8, Col: 1, Value: 7.07
Row: 9, Col: 1, Value: 9.350000000000001
Row: 10, Col: 1, Value: -7.89
DURING THE PERIODS SHOWN IN THE CHART FOR PAPER AND FOREST PRODUCTS,
THE HIGHEST RETURN FOR A QUARTER WAS 22.74 % (QUARTER ENDING
SEPTEMBER 30, 1994 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-21.04 % (QUARTER ENDING SEPTEMBER 30, 1998 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR PAPER AND FOREST
PRODUCTS WAS 1.41 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PRECIOUS METALS AND MINERALS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
32.16% -21.07% 1.54% -21.87% 111.62% -1.14% -3.34% 5.42% -44.89% 0.10%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 32.16
Row: 2, Col: 1, Value: -21.07
Row: 3, Col: 1, Value: 1.54
Row: 4, Col: 1, Value: -21.87
Row: 5, Col: 1, Value: 111.62
Row: 6, Col: 1, Value: -1.14
Row: 7, Col: 1, Value: -3.34
Row: 8, Col: 1, Value: 5.42
Row: 9, Col: 1, Value: -44.89
Row: 10, Col: 1, Value: 0.1
DURING THE PERIODS SHOWN IN THE CHART FOR PRECIOUS METALS AND
MINERALS, THE HIGHEST RETURN FOR A QUARTER WAS 33.66 % (QUARTER
ENDING JUNE 30, 1993 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-31.22 % (QUARTER ENDING DECEMBER 31, 1997 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR PRECIOUS METALS AND
MINERALS WAS -7.09 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
REGIONAL BANKS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
26.65% -20.67% 65.79% 48.52% 11.17% 0.22% 46.77% 35.89% 45.56% 11.85%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 26.65
Row: 2, Col: 1, Value: -20.67
Row: 3, Col: 1, Value: 65.79000000000001
Row: 4, Col: 1, Value: 48.52
Row: 5, Col: 1, Value: 11.17
Row: 6, Col: 1, Value: 0.22
Row: 7, Col: 1, Value: 46.77
Row: 8, Col: 1, Value: 35.89
Row: 9, Col: 1, Value: 45.56
Row: 10, Col: 1, Value: 11.85
DURING THE PERIODS SHOWN IN THE CHART FOR REGIONAL BANKS, THE HIGHEST
RETURN FOR A QUARTER WAS 22.20 % (QUARTER ENDING MARCH 31,
1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS -25.20 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR REGIONAL BANKS WAS
-3.13 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
RETAILING
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
29.53% -5.03% 68.13% 22.08% 13.03% -5.01% 11.98% 20.86% 41.73% 45.76%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 29.53
Row: 2, Col: 1, Value: -5.03
Row: 3, Col: 1, Value: 68.13
Row: 4, Col: 1, Value: 22.08
Row: 5, Col: 1, Value: 13.03
Row: 6, Col: 1, Value: -5.01
Row: 7, Col: 1, Value: 11.98
Row: 8, Col: 1, Value: 20.86
Row: 9, Col: 1, Value: 41.73
Row: 10, Col: 1, Value: 45.76000000000001
DURING THE PERIODS SHOWN IN THE CHART FOR RETAILING, THE HIGHEST
RETURN FOR A QUARTER WAS 34.78 % (QUARTER ENDING DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -27.05 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR RETAILING WAS
5.88 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SOFTWARE AND COMPUTER SERVICES
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
12.05% 0.86% 45.84% 35.54% 32.73% 0.39% 46.26% 21.77% 15.01% 45.77%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 12.05
Row: 2, Col: 1, Value: 0.8600000000000001
Row: 3, Col: 1, Value: 45.84
Row: 4, Col: 1, Value: 35.54
Row: 5, Col: 1, Value: 32.73
Row: 6, Col: 1, Value: 0.3900000000000001
Row: 7, Col: 1, Value: 46.26000000000001
Row: 8, Col: 1, Value: 21.77
Row: 9, Col: 1, Value: 15.01
Row: 10, Col: 1, Value: 45.77
DURING THE PERIODS SHOWN IN THE CHART FOR SOFTWARE AND COMPUTER
SERVICES, THE HIGHEST RETURN FOR A QUARTER WAS 30.03 % (QUARTER
ENDING MARCH 31, 1991 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-30.81 % (QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR SOFTWARE AND COMPUTER
SERVICES WAS 9.12 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TECHNOLOGY
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
16.99% 10.50% 58.97% 8.72% 28.65% 11.13% 43.81% 15.82% 10.33% 74.16%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 16.99
Row: 2, Col: 1, Value: 10.5
Row: 3, Col: 1, Value: 58.97
Row: 4, Col: 1, Value: 8.719999999999999
Row: 5, Col: 1, Value: 28.65
Row: 6, Col: 1, Value: 11.13
Row: 7, Col: 1, Value: 43.81
Row: 8, Col: 1, Value: 15.82
Row: 9, Col: 1, Value: 10.33
Row: 10, Col: 1, Value: 74.16
DURING THE PERIODS SHOWN IN THE CHART FOR TECHNOLOGY, THE HIGHEST
RETURN FOR A QUARTER WAS 45.96 % (QUARTER ENDING DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -25.19 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR TECHNOLOGY WAS
18.63 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TELECOMMUNICATIONS
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
50.88% -16.40% 30.85% 15.32% 29.72% 4.32% 29.66% 5.40% 25.83% 41.04%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 50.88
Row: 2, Col: 1, Value: -16.4
Row: 3, Col: 1, Value: 30.85
Row: 4, Col: 1, Value: 15.32
Row: 5, Col: 1, Value: 29.72
Row: 6, Col: 1, Value: 4.319999999999999
Row: 7, Col: 1, Value: 29.66
Row: 8, Col: 1, Value: 5.4
Row: 9, Col: 1, Value: 25.83
Row: 10, Col: 1, Value: 41.04
DURING THE PERIODS SHOWN IN THE CHART FOR TELECOMMUNICATIONS, THE
HIGHEST RETURN FOR A QUARTER WAS 30.69 % (QUARTER ENDING
DECEMBER 31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-21.14 % (QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR TELECOMMUNICATIONS
WAS 10.09 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TRANSPORTATION
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
28.49% -21.59% 54.14% 23.79% 29.32% 3.87% 15.17% 9.50% 32.13% -4.34%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 28.49
Row: 2, Col: 1, Value: -21.59
Row: 3, Col: 1, Value: 54.14
Row: 4, Col: 1, Value: 23.79
Row: 5, Col: 1, Value: 29.32
Row: 6, Col: 1, Value: 3.87
Row: 7, Col: 1, Value: 15.17
Row: 8, Col: 1, Value: 9.5
Row: 9, Col: 1, Value: 32.13
Row: 10, Col: 1, Value: -4.34
DURING THE PERIODS SHOWN IN THE CHART FOR TRANSPORTATION, THE HIGHEST
RETURN FOR A QUARTER WAS 19.76 % (QUARTER ENDING DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -25.91 %
(QUARTER ENDING SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR TRANSPORTATION WAS
15.57 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
UTILITIES GROWTH
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
39.02% 0.55% 21.03% 10.59% 12.54% -7.41% 34.39% 11.37% 30.31% 43.16%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 39.02
Row: 2, Col: 1, Value: 0.55
Row: 3, Col: 1, Value: 21.03
Row: 4, Col: 1, Value: 10.59
Row: 5, Col: 1, Value: 12.54
Row: 6, Col: 1, Value: -7.41
Row: 7, Col: 1, Value: 34.39
Row: 8, Col: 1, Value: 11.37
Row: 9, Col: 1, Value: 30.31
Row: 10, Col: 1, Value: 43.16
DURING THE PERIODS SHOWN IN THE CHART FOR UTILITIES GROWTH, THE
HIGHEST RETURN FOR A QUARTER WAS 23.01 % (QUARTER ENDING
DECEMBER 31, 1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS
-6.17 % (QUARTER ENDING DECEMBER 31, 1993 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR UTILITIES GROWTH WAS
3.84 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET
Calendar Years 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
8.98% 7.79% 5.80% 3.52% 2.69% 3.74% 5.66% 5.06% 5.20% 5.20%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 8.98
Row: 2, Col: 1, Value: 7.79
Row: 3, Col: 1, Value: 5.8
Row: 4, Col: 1, Value: 3.52
Row: 5, Col: 1, Value: 2.69
Row: 6, Col: 1, Value: 3.74
Row: 7, Col: 1, Value: 5.659999999999999
Row: 8, Col: 1, Value: 5.06
Row: 9, Col: 1, Value: 5.2
Row: 10, Col: 1, Value: 5.2
DURING THE PERIODS SHOWN IN THE CHART FOR MONEY MARKET, THE HIGHEST
RETURN FOR A QUARTER WAS 1.91 % (QUARTER ENDING JUNE 30,
1990 ) AND THE LOWEST RETURN FOR A QUARTER WAS 0.63 %
(QUARTER ENDING DECEMBER 31, 1993 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 1999 FOR MONEY MARKET WAS
1.14 %.
AVERAGE ANNUAL RETURNS
The returns in the following table include the effect of each fund's
3.00% maximum applicable front-end sales charge and $7.50 exchange
fee (stock funds only).
<TABLE>
<CAPTION>
<S> <C> <C> <C>
For the periods ended Past 1 year Past 5 years Past 10 years/ Life of fundA
December 31, 1998
Air Transportation 3.15% 11.33% 12.95%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Automotive 1.72% 6.42% 13.31%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Biotechnology 25.75% 13.31% 21.44%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Health Care Index 40.26% N/A N/A
Brokerage and Investment 2.43% 18.89% 20.58%
Management
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Financial 9.04% N/A N/A
Services Index
Chemicals -18.49% 9.98% 11.91%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Computers 90.41% 35.63% 28.13%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Technology Index 69.16% N/A N/A
Construction and Housing 19.08% 13.64% 16.17%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Consumer Industries 23.59% 18.15% 20.06%B
S&P 500 28.58% 24.06% 20.83%
Goldman Sachs Consumer 24.91% N/A N/A
Industries Index
Cyclical Industries 5.43% N/A 5.43%B
S&P 500 28.58% N/A 28.58%
Goldman Sachs Cyclical 4.74% N/A 4.74%
Industries Index
Defense and Aerospace 1.13% 18.57% 14.81%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Developing Communications 62.57% 21.69% 26.73%B
S&P 500 28.58% 24.06% 20.83%
Goldman Sachs Technology Index 69.16% N/A N/A
Electronics 46.51% 36.14% 29.27%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Technology Index 69.16% N/A N/A
For the periods ended Past 1 year Past 5 years Past 10 years/ Life of fundA
December 31, 1998
Energy -17.37% 8.04% 8.86%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Natural -14.19% N/A N/A
Resources Index
Energy Service -51.30% 9.35% 9.28%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Natural -14.19% N/A N/A
Resources Index
Environmental Services -19.53% 4.59% 2.85%B
S&P 500 28.58% 24.06% 17.90%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Financial Services 10.64% 24.13% 21.86%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Financial 9.04% N/A N/A
Services Index
Food and Agriculture 12.14% 19.16% 18.89%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Consumer 24.91% N/A N/A
Industries Index
Gold -11.45% -9.57% -0.06%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Natural -14.19% N/A N/A
Resources Index
Health Care 36.97% 29.74% 26.04%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Health Care Index 40.26% N/A N/A
Home Finance -17.43% 21.04% 23.08%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Financial 9.04% N/A N/A
Services Index
Industrial Equipment 9.22% 16.69% 15.87%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Industrial Materials -13.76% 4.55% 7.19%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Insurance 16.64% 22.54% 20.06%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Financial 9.04% N/A N/A
Services Index
Leisure 33.71% 20.44% 18.75%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Consumer 24.91% N/A N/A
Industries Index
Medical Delivery -9.05% 13.96% 19.12%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Health Care Index 40.26% N/A N/A
For the periods ended Past 1 year Past 5 years Past 10 years/ Life of fundA
December 31, 1998
Multimedia 31.55% 19.34% 18.53%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Consumer 24.91% N/A N/A
Industries Index
Natural Gas -15.10% 4.96% 4.96%B
S&P 500 28.58% 24.06% 24.06%
Goldman Sachs Utilities Index 34.29% N/A N/A
Natural Resources -19.15% N/A -19.15%B
S&P 500 28.58% N/A 28.58%
Goldman Sachs Natural -14.19% N/A -14.19%
Resources Index
Paper and Forest Products -10.73% 7.79% 8.69%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Precious Metals and Minerals -2.97% -11.65% -0.58%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Natural -14.19% N/A N/A
Resources Index
Regional Banks 8.42% 25.84% 24.12%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Financial 9.04% N/A N/A
Services Index
Retailing 41.32% 20.83% 22.08%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Consumer 24.91% N/A N/A
Industries Index
Software and Computer Services 41.32% 23.79% 24.04%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Technology Index 69.16% N/A N/A
Technology 68.86% 28.10% 25.79%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Technology Index 69.16% N/A N/A
Telecommunications 36.74% 19.66% 19.74%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Utilities Index 34.29% N/A N/A
Transportation -7.28% 9.93% 14.85%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Cyclical 4.74% N/A N/A
Industries Index
Utilities Growth 38.79% 20.18% 18.10%
S&P 500 28.58% 24.06% 19.21%
Goldman Sachs Utilities Index 34.29% N/A N/A
Money Market 2.04% 4.33% 5.03%
</TABLE>
A BEGINNING JANUARY 1 OF THE FIRST CALENDAR YEAR FOLLOWING THE
FUND'S COMMENCEMENT OF OPERATIONS.
B FROM JANUARY 1, 1990 FOR ENVIRONMENTAL SERVICES; JANUARY 1,
1991 FOR CONSUMER INDUSTRIES AND DEVELOPING COMMUNICATIONS; JANUARY 1,
1994 FOR NATURAL GAS; AND JANUARY 1, 1998 FOR CYCLICAL INDUSTRIES AND
NATURAL RESOURCES.
If FMR had not reimbursed certain fund expenses during these periods,
each fund's returns would have been lower.
Standard & Poor's 500 Index (S&P 500(registered trademark)) is a
market capitalization-weighted index of common stocks.
Goldman Sachs Consumer Industries Index is a market
capitalization-weighted index of 300 stocks designed to measure the
performance of companies in the consumer industries sector.
Goldman Sachs Cyclical Industries Index is a market
capitalization-weighted index of 277 stocks designed to measure the
performance of companies in the cyclical industries sector.
Goldman Sachs Financial Services Index is a market
capitalization-weighted index of 271 stocks designed to measure the
performance of companies in the financial services sector.
Goldman Sachs Health Care Index is a market capitalization-weighted
index of 93 stocks designed to measure the performance of companies in
the health care sector.
Goldman Sachs Natural Resources Index is a market
capitalization-weighted index of 96 stocks designed to measure the
performance of companies in the natural resources sector.
Goldman Sachs Technology Index is a market capitalization-weighted
index of 190 stocks designed to measure the performance of companies
in the technology sector.
Goldman Sachs Utilities Index is a market capitalization-weighted
index of 136 stocks designed to measure the performance of companies
in the utilities sector.
FEE TABLE
The following table describes the fees and expenses that are incurred
when you buy, hold or sell shares of a fund. The annual fund
operating expenses provided below for each fund do not reflect the
effect of any reduction of certain expenses during the period. The
annual fund operating expenses provided below for Cyclical
Industries and Natural Resources do not reflect the effect of any
expense reimbursements during the period.
SHAREHOLDER FEES (PAID BY THE INVESTOR DIRECTLY)
Maximum sales charge (load) 3.00%
on purchases (as a % of
offering price)A
Sales charge (load) on None
reinvested distributions
Deferred sales charge (load) None
on redemptions
Redemption fee for the stock 0.75%
funds (as a % of amount 0.75%
redeemed) $ 7.50
on shares held 29 days or less
on shares held 30 days or
more for redemption amounts
of up to $1,000 for
redemption amounts of $1,000
or more
Exchange fee
for the stock funds onlyB $ 7.50
Annual account maintenance $ 12.00
fee (for accounts under
$2,500)
A LOWER SALES CHARGES MAY BE AVAILABLE FOR ACCOUNTS OVER $250,000.
B YOU WILL NOT PAY AN EXCHANGE FEE IF YOU EXCHANGE THROUGH ANY OF
FIDELITY'S AUTOMATED EXCHANGE SERVICES.
ANNUAL FUND OPERATING EXPENSES (PAID FROM FUND ASSETS)
AIR TRANSPORTATION Management fee 0.58%
Distribution and Service None
(12b-1) fee
Other expenses 0.77%
Total annual fund operating 1.35%
expensesA
AUTOMOTIVE Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.86%
Total annual fund operating 1.45%
expensesA
BIOTECHNOLOGY Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.75%
Total annual fund operating 1.34%
expensesA
BROKERAGE AND INVESTMENT Management fee 0.59%
MANAGEMENT
Distribution and Service None
(12b-1) fee
Other expenses 0.67%
Total annual fund operating 1.26%
expensesA
BUSINESS SERVICES AND Management fee 0.59%
OUTSOURCING
Distribution and Service None
(12b-1) fee
Other expenses 1.07%
Total annual fund operating 1.66%
expensesA
CHEMICALS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.99%
Total annual fund operating 1.58%
expensesA
COMPUTERS Management fee 0.60%
Distribution and Service None
(12b-1) fee
Other expenses 0.65%
Total annual fund operating 1.25%
expensesA
CONSTRUCTION AND HOUSING Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.84%
Total annual fund operating 1.43%
expensesA
CONSUMER INDUSTRIES Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.75%
Total annual fund operating 1.34%
expensesA
CYCLICAL INDUSTRIES Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 3.38%
Total annual fund operating 3.97%
expensesA
DEFENSE AND AEROSPACE Management fee 0.58%
Distribution and Service None
(12b-1) fee
Other expenses 0.90%
Total annual fund operating 1.48%
expensesA
DEVELOPING COMMUNICATIONS Management fee 0.60%
Distribution and Service None
(12b-1) fee
Other expenses 0.78%
Total annual fund operating 1.38%
expensesA
ELECTRONICS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.59%
Total annual fund operating 1.18%
expensesA
ENERGY Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.87%
Total annual fund operating 1.46%
expensesA
ENERGY SERVICE Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.80%
Total annual fund operating 1.39%
expensesA
ENVIRONMENTAL SERVICES Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 1.61%
Total annual fund operating 2.20%
expensesA
FINANCIAL SERVICES Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.61%
Total annual fund operating 1.20%
expensesA
FOOD AND AGRICULTURE Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.72%
Total annual fund operating 1.31%
expensesA
GOLD Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.98%
Total annual fund operating 1.57%
expensesA
HEALTH CARE Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.48%
Total annual fund operating 1.07%
expensesA
HOME FINANCE Management fee 0.58%
Distribution and Service None
(12b-1) fee
Other expenses 0.61%
Total annual fund operating 1.19%
expensesA
INDUSTRIAL EQUIPMENT Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.84%
Total annual fund operating 1.43%
expensesA
INDUSTRIAL MATERIALS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 1.48%
Total annual fund operating 2.07%
expensesA
INSURANCE Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.74%
Total annual fund operating 1.33%
expensesA
LEISURE Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.67%
Total annual fund operating 1.26%
expensesA
MEDICAL DELIVERY Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.81%
Total annual fund operating 1.40%
expensesA
MEDICAL EQUIPMENT AND SYSTEMS Management fee 0.60%
Distribution and Service None
(12b-1) fee
Other expenses 1.79%
Total annual fund operating 2.39%
expensesA
MULTIMEDIA Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.76%
Total annual fund operating 1.35%
expensesA
NATURAL GAS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.98%
Total annual fund operating 1.57%
expensesA
NATURAL RESOURCES Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 2.61%
Total annual fund operating 3.20%
expensesA
PAPER AND FOREST PRODUCTS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 1.71%
Total annual fund operating 2.30%
expensesA
PRECIOUS METALS AND MINERALS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 1.19%
Total annual fund operating 1.78%
expensesA
REGIONAL BANKS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.58%
Total annual fund operating 1.17%
expensesA
RETAILING Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.66%
Total annual fund operating 1.25%
expensesA
SOFTWARE AND COMPUTER SERVICES Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.69%
Total annual fund operating 1.28%
expensesA
TECHNOLOGY Management fee 0.60%
Distribution and Service None
(12b-1) fee
Other expenses 0.64%
Total annual fund operating 1.24%
expensesA
TELECOMMUNICATIONS Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.68%
Total annual fund operating 1.27%
expensesA
TRANSPORTATION Management fee 0.58%
Distribution and Service None
(12b-1) fee
Other expenses 1.38%
Total annual fund operating 1.96%
expensesA
UTILITIES GROWTH Management fee 0.59%
Distribution and Service None
(12b-1) fee
Other expenses 0.59%
Total annual fund operating 1.18%
expensesA
MONEY MARKET Management fee 0.20%
Distribution and Service None
(12b-1) fee
Other expenses 0.30%
Total annual fund operating 0.50%
expensesA
A FMR HAS VOLUNTARILY AGREED TO REIMBURSE EACH FUND TO THE EXTENT THAT
TOTAL OPERATING EXPENSES (EXCLUDING INTEREST, TAXES, SECURITIES
LENDING FEES, BROKERAGE COMMISSIONS AND EXTRAORDINARY EXPENSES), AS A
PERCENTAGE OF THEIR RESPECTIVE AVERAGE NET ASSETS, EXCEED 2.50%. THESE
ARRANGEMENTS CAN BE TERMINATED BY FMR AT ANY TIME.
A portion of the brokerage commissions that a fund pays is used to
reduce that fund's expenses. In addition, each fund has entered into
arrangements with its custodian and transfer agent whereby credits
realized as a result of uninvested cash balances are used to reduce
custodian and transfer agent expenses. Including these reductions, the
total fund operating expenses, after reimbursement for Cyclical
Industries and Natural Resources, would have been:
Air Transportation 1.27%
Automotive 1.41%
Biotechnology 1.30%
Brokerage and Investment 1.24%
Management
Business Services and 1.64%
Outsourcing
Chemicals 1.51%
Computers 1.23%
Construction and Housing 1.37%
Consumer Industries 1.32%
Cyclical Industries 2.49%
Defense and Aerospace 1.42%
Developing Communications 1.34%
Electronics 1.15%
Energy 1.42%
Energy Service 1.35%
Environmental Services 2.16%
Financial Services 1.18%
Food and Agriculture 1.29%
Gold 1.54%
Health Care 1.05%
Home Finance 1.18%
Industrial Equipment 1.41%
Industrial Materials 2.04%
Insurance 1.31%
Leisure 1.24%
Medical Delivery 1.37%
Medical Equipment and Systems 2.38%
Multimedia 1.33%
Natural Gas 1.52%
Natural Resources 2.47%
Paper and Forest Products 2.21%
Precious Metals and Minerals 1.74%
Regional Banks 1.16%
Retailing 1.22%
Software and Computer Services 1.27%
Technology 1.20%
Telecommunications 1.25%
Transportation 1.90%
Utilities Growth 1.16%
Money Market 0.49%
This EXAMPLE helps you compare the cost of investing in the funds with
the cost of investing in other mutual funds.
Let's say, hypothetically, that each fund's annual return is 5% and
that your shareholder fees and each fund's annual operating expenses
are exactly as described in the fee table. 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
and if you leave your account open:
Account open Account closed
AIR TRANSPORTATION 1 year $ 433 $ 441
3 years $ 715 $ 722
5 years $ 1,017 $ 1,025
10 years $ 1,875 $ 1,883
AUTOMOTIVE 1 year $ 443 $ 451
3 years $ 745 $ 752
5 years $ 1,068 $ 1,076
10 years $ 1,983 $ 1,991
BIOTECHNOLOGY 1 year $ 432 $ 440
3 years $ 712 $ 719
5 years $ 1,012 $ 1,020
10 years $ 1,864 $ 1,872
BROKERAGE AND INVESTMENT 1 year $ 425 $ 432
MANAGEMENT
3 years $ 688 $ 695
5 years $ 971 $ 978
10 years $ 1,777 $ 1,784
BUSINESS SERVICES AND 1 year $ 464 $ 471
OUTSOURCING
3 years $ 808 $ 815
5 years $ 1,175 $ 1,183
10 years $ 2,206 $ 2,214
CHEMICALS 1 year $ 456 $ 463
3 years $ 784 $ 791
5 years $ 1,135 $ 1,142
10 years $ 2,122 $ 2,129
COMPUTERS 1 year $ 424 $ 431
3 years $ 685 $ 692
5 years $ 966 $ 973
10 years $ 1,766 $ 1,773
CONSTRUCTION AND HOUSING 1 year $ 441 $ 449
3 years $ 739 $ 746
5 years $ 1,058 $ 1,066
10 years $ 1,962 $ 1,969
CONSUMER INDUSTRIES 1 year $ 432 $ 440
3 years $ 712 $ 719
5 years $ 1,012 $ 1,020
10 years $ 1,864 $ 1,872
CYCLICAL INDUSTRIES 1 year $ 687 $ 695
3 years $ 1,473 $ 1,481
5 years $ 2,276 $ 2,283
10 years $ 4,355 $ 4,363
DEFENSE AND AEROSPACE 1 year $ 446 $ 454
3 years $ 754 $ 761
5 years $ 1,084 $ 1,091
10 years $ 2,015 $ 2,023
DEVELOPING COMMUNICATIONS 1 year $ 436 $ 444
3 years $ 724 $ 731
5 years $ 1,033 $ 1,040
10 years $ 1,908 $ 1,915
ELECTRONICS 1 year $ 417 $ 424
3 years $ 663 $ 671
5 years $ 930 $ 937
10 years $ 1,689 $ 1,696
ENERGY 1 year $ 444 $ 452
3 years $ 748 $ 755
5 years $ 1,073 $ 1,081
10 years $ 1,994 $ 2,001
ENERGY SERVICE 1 year $ 437 $ 445
3 years $ 727 $ 734
5 years $ 1,038 $ 1,045
10 years $ 1,919 $ 1,926
ENVIRONMENTAL SERVICES 1 year $ 516 $ 524
3 years $ 968 $ 975
5 years $ 1,444 $ 1,452
10 years $ 2,758 $ 2,765
FINANCIAL SERVICES 1 year $ 419 $ 426
3 years $ 670 $ 677
5 years $ 940 $ 947
10 years $ 1,711 $ 1,718
FOOD AND AGRICULTURE 1 year $ 429 $ 437
3 years $ 703 $ 710
5 years $ 997 $ 1,004
10 years $ 1,832 $ 1,839
GOLD 1 year $ 455 $ 462
3 years $ 781 $ 788
5 years $ 1,129 $ 1,137
10 years $ 2,111 $ 2,119
HEALTH CARE 1 year $ 406 $ 413
3 years $ 630 $ 638
5 years $ 872 $ 880
10 years $ 1,566 $ 1,574
HOME FINANCE 1 year $ 418 $ 425
3 years $ 667 $ 674
5 years $ 935 $ 942
10 years $ 1,700 $ 1,707
INDUSTRIAL EQUIPMENT 1 year $ 441 $ 449
3 years $ 739 $ 746
5 years $ 1,058 $ 1,066
10 years $ 1,962 $ 1,969
INDUSTRIAL MATERIALS 1 year $ 504 $ 511
3 years $ 929 $ 937
5 years $ 1,380 $ 1,388
10 years $ 2,628 $ 2,636
INSURANCE 1 year $ 431 $ 439
3 years $ 709 $ 716
5 years $ 1,007 $ 1,014
10 years $ 1,853 $ 1,861
LEISURE 1 year $ 425 $ 432
3 years $ 688 $ 695
5 years $ 971 $ 978
10 years $ 1,777 $ 1,784
MEDICAL DELIVERY 1 year $ 438 $ 446
3 years $ 730 $ 737
5 years $ 1,043 $ 1,050
10 years $ 1,929 $ 1,937
MEDICAL EQUIPMENT AND SYSTEMS 1 year $ 535 $ 542
3 years $ 1,023 $ 1,031
5 years $ 1,537 $ 1,545
10 years $ 2,944 $ 2,952
MULTIMEDIA 1 year $ 433 $ 441
3 years $ 715 $ 722
5 years $ 1,017 $ 1,025
10 years $ 1,875 $ 1,883
NATURAL GAS 1 year $ 455 $ 462
3 years $ 781 $ 788
5 years $ 1,129 $ 1,137
10 years $ 2,111 $ 2,119
NATURAL RESOURCES 1 year $ 613 $ 621
3 years $ 1,257 $ 1,264
5 years $ 1,923 $ 1,931
10 years $ 3,698 $ 3,706
PAPER AND FOREST PRODUCTS 1 year $ 526 $ 534
3 years $ 997 $ 1,004
5 years $ 1,493 $ 1,501
10 years $ 2,857 $ 2,864
PRECIOUS METALS AND MINERALS 1 year $ 475 $ 483
3 years $ 843 $ 851
5 years $ 1,236 $ 1,243
10 years $ 2,332 $ 2,339
REGIONAL BANKS 1 year $ 416 $ 423
3 years $ 660 $ 668
5 years $ 924 $ 932
10 years $ 1,678 $ 1,685
RETAILING 1 year $ 424 $ 431
3 years $ 685 $ 692
5 years $ 966 $ 973
10 years $ 1,766 $ 1,773
SOFTWARE AND COMPUTER SERVICES 1 year $ 426 $ 434
3 years $ 694 $ 701
5 years $ 981 $ 989
10 years $ 1,799 $ 1,806
TECHNOLOGY 1 year $ 423 $ 430
3 years $ 682 $ 689
5 years $ 961 $ 968
10 years $ 1,755 $ 1,762
TELECOMMUNICATIONS 1 year $ 425 $ 433
3 years $ 691 $ 699
5 years $ 976 $ 984
10 years $ 1,788 $ 1,796
TRANSPORTATION 1 year $ 493 $ 501
3 years $ 897 $ 904
5 years $ 1,326 $ 1,333
10 years $ 2,517 $ 2,524
UTILITIES GROWTH 1 year $ 417 $ 424
3 years $ 663 $ 671
5 years $ 930 $ 937
10 years $ 1,689 $ 1,696
MONEY MARKET 1 year $ 350 $ 350
3 years $ 456 $ 456
5 years $ 571 $ 571
10 years $ 909 $ 909
FUND BASICS
INVESTMENT DETAILS
THE STOCK FUNDS
INVESTMENT OBJECTIVE
Each fund seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
AIR TRANSPORTATION PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the regional, national, and
international movement of passengers, mail, and freight via aircraft.
These companies may include, for example, major airlines, commuter
airlines, air cargo and express delivery operators, airfreight
forwarders, and companies that provide equipment or services to these
companies, such as aviation service firms and manufacturers of
aeronautical equipment.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
AUTOMOTIVE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the manufacture, marketing or sale
of automobiles, trucks, specialty vehicles, parts, tires, and related
services. These companies may include, for example, companies involved
with the manufacture and distribution of vehicles, vehicle parts and
tires (either original equipment or for the after market) and
companies involved in the retail sale of vehicles, parts, or tires.
They may also include companies that provide automotive-related
services to manufacturers, distributors or consumers.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
BIOTECHNOLOGY PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the research, development, and
manufacture of various biotechnological products, services, and
processes. These companies may include, for example, companies
involved with applications and developments in such areas as human
health care (e.g., cancer, infectious disease, diagnostics and
therapeutics); pharmaceuticals (e.g., new drug development and
production); agricultural and veterinary applications (e.g., improved
seed varieties, animal growth hormones); chemicals (e.g., enzymes,
toxic waste treatment); medical/surgical (e.g., epidermal growth
factor, in vivo imaging/therapeutics); and industry (e.g., biochips,
fermentation, enhanced mineral recovery). They may also include
companies that manufacture biotechnological and biomedical products,
including devices and instruments; companies that provide
biotechnological processes or services; companies that provide
scientific and technological advances in biotechnology; and companies
involved with new or experimental technologies such as genetic
engineering, hybridoma and recombinant DNA techniques and monoclonal
antibodies.
FMR may also invest the fund's assets in securities of companies that
distribute biotechnological and biomedical products, including devices
and instruments, and companies that benefit significantly from
scientific and technological advances in biotechnology.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
BROKERAGE AND INVESTMENT MANAGEMENT PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in stock brokerage, commodity
brokerage, investment banking, tax-advantaged investment or investment
sales, investment management, or related investment advisory services.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
BUSINESS SERVICES AND OUTSOURCING PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in providing business-related
services to companies and other organizations. These companies may
include those that provide, for example, data processing, consulting,
outsourcing, temporary employment, market research or database
services, printing, advertising, computer programming, credit
reporting, claims collection, mailing and photocopying, typically on a
contractual or fee basis.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
CHEMICALS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the research, development,
manufacture or marketing of products or services related to the
chemical process industries. These companies may include, for example,
companies involved with products such as basic and intermediate
organic and inorganic chemicals, plastics, synthetic fibers,
fertilizers, industrial gases, flavorings, fragrances, biological
materials, catalysts, carriers, additives, and process aids. They may
also include companies providing design, engineering, construction,
and consulting services to companies engaged in chemical processing.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
COMPUTERS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in research, design, development,
manufacture or distribution of products, processes or services that
relate to currently available or experimental hardware technology
within the computer industry. These companies may include, for
example, companies that provide products or services such as
mainframes, minicomputers, microcomputers, peripherals, computer and
office equipment wholesalers, software retailers, data or information
processing, office or factory automation, robotics, artificial
intelligence, computer-aided design, medical technology, engineering
and manufacturing, data communications and software.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
CONSTRUCTION AND HOUSING PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the design and construction of
residential, commercial, industrial and public works facilities, as
well as companies engaged in the manufacture, supply, distribution or
sale of products or services to these construction industries. These
companies may include, for example, companies that produce basic
building materials such as cement, aggregates, gypsum, timber, and
wall and floor coverings; companies that supply home furnishings; and
companies that provide engineering or contracting services. They may
also include companies involved in real estate development and
construction financing such as homebuilders, architectural and design
firms, and property managers, and companies involved in the home
improvement and maintenance industry, including building material
retailers and distributors, household service firms, and those
companies that supply such companies.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
CONSUMER INDUSTRIES PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the manufacture and distribution
of goods to consumers both domestically and internationally. These
companies may include, for example, companies that manufacture or sell
durable goods such as homes, cars, boats, furniture, major appliances,
and personal computers; and companies that manufacture, wholesale, or
retail non-durable goods such as food, beverages, tobacco, health care
products, household and personal care products, apparel, and
entertainment products (e.g., books, magazines, TV, cable, movies,
music, gaming, sports). They may also include companies that provide
consumer services such as lodging, child care, convenience stores, and
car rentals.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
CYCLICAL INDUSTRIES PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the research, development,
manufacture, distribution, supply, or sale of materials, equipment,
products or services related to cyclical industries. These companies
may include, for example, companies in the the automotive, chemical,
construction and housing, defense and aerospace, environmental
services, industrial equipment and materials, paper and forest
products, and transportation industries.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
DEFENSE AND AEROSPACE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the research, manufacture or sale
of products or services related to the defense or aerospace
industries. These companies may include, for example, companies that
provide the following products or services: air transport; defense
electronics; aircraft or spacecraft production; missile design; data
processing or computer-related services; communications systems;
research; development and manufacture of military weapons and
transportation; general aviation equipment, missiles, space launch
vehicles, and spacecraft; units for guidance, propulsion, and control
of flight vehicles; and equipment components and airborne and
ground-based equipment essential to the testing, operation, and
maintenance of flight vehicles.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
DEVELOPING COMMUNICATIONS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the development, manufacture or
sale of emerging communications services or equipment. Emerging
communications are those which derive from new technologies or new
applications of existing technologies. These companies may include,
for example, companies involved in cellular communications, software
development, video conferencing, data processing, paging, personal
communications networks, special mobile radio, facsimile, fiber optic
transmission, voicemail, microwave, satellite, local and wide area
networking, and other transmission electronics. FMR places less
emphasis on traditional communications companies such as traditional
telephone utilities and large long distance carriers.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
ELECTRONICS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the design, manufacture, or sale
of electronic components (semiconductors, connectors, printed circuit
boards and other components); equipment vendors to electronic
component manufacturers; electronic component distributors; and
electronic instruments and electronic systems vendors. These companies
may include, for example, companies involved in all aspects of the
electronics business and in new technologies or specialty areas such
as defense electronics, medical electronics, consumer electronics,
advanced design and manufacturing technologies (e.g., computer-aided
design and computer-aided manufacturing, computer-aided engineering,
and robotics), and lasers and electro-optics.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
ENERGY PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the energy field, including the
conventional areas of oil, gas, electricity and coal, and newer
sources of energy such as nuclear, geothermal, oil shale, and solar
power. These companies may include, for example, companies that
produce, generate, refine, control, transmit, market, distribute or
measure energy or energy fuels such as petro-chemicals; companies
involved in providing products and services to companies in the energy
field; companies involved in energy research or experimentation; and
companies involved in the exploration of new sources of energy,
conservation, and energy-related pollution control.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
ENERGY SERVICE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the energy service field,
including those that provide services and equipment to the
conventional areas of oil, gas, electricity and coal, and newer
sources of energy such as nuclear, geothermal, oil shale, and solar
power. These companies may include, for example, companies providing
services and equipment for drilling processes such as offshore and
onshore drilling; companies involved in production and well
maintenance; companies involved in exploration engineering, data and
technology; companies that provide geological and geophysical
services; companies involved in energy transport; companies involved
in geothermal, electric or nuclear plant design or construction; and
companies with a variety of products or services including oil tool
rental, underwater well services, helicopter services, energy-related
capital equipment, and mining-related equipment or services. They may
also include companies that provide products and services to these
companies.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
ENVIRONMENTAL SERVICES PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the research, development,
manufacture or distribution of products, processes, or services
related to waste management or pollution control. These companies may
include, for example, companies involved in the transportation,
treatment, and disposal of both hazardous and solid wastes, including:
waste-to-energy and recycling; remedial project efforts, including
groundwater and underground storage tank decontamination, asbestos
cleanup and emergency cleanup response; and the detection, analysis,
evaluation, and treatment of both existing and potential environmental
problems including, among others, contaminated water, air pollution,
and acid rain. They may also include companies that provide design,
engineering, construction, and consulting services to companies
engaged in waste management or pollution control.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
FINANCIAL SERVICES PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80%, of the fund's assets in securities
of companies principally engaged in providing financial services to
consumers and industry. These companies may include, for example,
commercial banks, savings and loan associations, brokerage companies,
insurance companies, real estate-related companies, leasing companies,
and consumer and industrial finance companies.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
FOOD AND AGRICULTURE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the manufacture, sale, or
distribution of food and beverage products, agricultural products, and
products related to the development of new food technologies. These
companies may include, for example, companies that sell products and
services such as meat and poultry processing and wholesale and retail
distribution and warehousing of food and food-related products,
including restaurants and grocery stores; companies that manufacture
and distribute products including soft drinks, packaged food products
(such as cereals, pet foods, and frozen foods), health food and
dietary products, wood products, tobacco, fertilizer and agricultural
machinery; and companies engaged in the development of new
technologies to provide, for example, improved hybrid seeds, new and
safer food storage and new enzyme technologies.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
GOLD PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks and
in certain precious metals. FMR invests the fund's assets primarily in
companies engaged in exploration, mining, processing, or dealing in
gold, or to a lesser degree, in silver, platinum, diamonds, or other
precious metals and minerals.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in gold-related activities, and in
gold bullion or coins. Gold-related activities may include
exploration, mining, processing, or dealing in gold or the manufacture
or distribution of gold products such as jewelry, watches and gold
foil and leaf. FMR treats investments in instruments whose value is
linked to the price of gold as investments in gold bullion or coins.
FMR may also invest the fund's assets in other precious metals in the
form of bullion, coins, securities indexed to the price of precious
metals, and securities of companies that manufacture and distribute
precious metal and minerals products (such as jewelry, watches, and
metal foils and leaf) and companies that invest in other companies
engaged in gold and other precious metal and mineral-related
activities.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
HEALTH CARE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the design, manufacture, or sale
of products or services used for or in connection with health care or
medicine. These companies may include, for example, pharmaceutical
companies; companies involved in biotechnology, medical diagnostic,
biochemical or other health care research and development; companies
involved in the operation of health care facilities; and other
companies involved in the design, manufacture, or sale of health
care-related products or services such as medical, dental and optical
products, hardware or services.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
HOME FINANCE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in investing in real estate, usually
through mortgages and other consumer-related loans. These companies
may include, for example, mortgage banking companies, real estate
investment trusts, government-sponsored enterprises, consumer finance
companies, savings and loan associations, savings banks, building and
loan associations, cooperative banks, commercial banks, and other
depository institutions.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
INDUSTRIAL EQUIPMENT PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the manufacture, distribution, or
service of products and equipment for the industrial sector, including
integrated producers of capital equipment (such as general industrial
machinery, farm equipment, and computers), parts suppliers, and
subcontractors. These companies may include, for example, companies
that provide service establishment, railroad, textile, farming,
mining, oilfield, semiconductor, and telecommunications equipment;
companies that manufacture products or service equipment for trucks,
construction, transportation or machine tools; companies that
manufacture products or service equipment for the food, clothing or
sporting goods industries; cable equipment companies; and office
automation companies.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
INDUSTRIAL MATERIALS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the manufacture, mining,
processing, or distribution of raw materials and intermediate goods
used in the industrial sector. These materials and goods may include,
for example, chemicals, metals, textiles, wood products, cement and
gypsum. These companies may include, for example, mining, processing,
transportation, and distribution companies, including equipment
suppliers and railroads.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
INSURANCE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in underwriting, reinsuring, selling,
distributing, or placing of property and casualty, life, or health
insurance. These companies may include, for example, companies that
provide a specific type of insurance, such as life or health
insurance, those that offer a variety of insurance products, and those
that provide insurance services such as insurance brokers, reciprocals
and claims processors.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
LEISURE PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the design, production, or
distribution of goods or services in the leisure industries. These
companies may include, for example, companies that provide goods or
services including: television and radio broadcast or manufacture
(including cable television); motion pictures and photography;
recordings and musical instruments; publishing, including newspapers
and magazines; sporting goods and camping and recreational equipment;
sports arenas and gaming casinos; toys and games, including video and
other electronic games; amusement and theme parks; travel and
travel-related services; hotels and motels; leisure apparel or
footwear; fast food, beverages, restaurants, and tobacco products.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
MEDICAL DELIVERY PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the ownership or management of
hospitals, nursing homes, health maintenance organizations, and other
companies specializing in the delivery of health care services. These
companies may include, for example, companies that operate acute care,
psychiatric, teaching, or specialized treatment hospitals; companies
that provide outpatient surgical, outpatient rehabilitation, or other
specialized care, home health care, drug and alcohol abuse treatment,
and dental care; companies that operate comprehensive health
maintenance organizations and nursing homes for the elderly and
disabled; companies that supply medical equipment; and companies that
provide related services.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
MEDICAL EQUIPMENT AND SYSTEMS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in research, development,
manufacture, distribution, supply or sale of medical equipment and
devices and related technologies. These companies may include, for
example, companies involved in the design and manufacture of medical
equipment and devices, drug delivery technologies, hospital equipment
and supplies, medical instrumentation and medical diagnostics.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
MULTIMEDIA PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the development, production, sale,
and distribution of goods or services used in the broadcast and media
industries. These companies may include, for example, advertising
companies; companies that own, operate or broadcast free or pay
television, radio or cable stations; theaters; film studios;
publishers or sellers of newspapers, magazines, books or video
products; printing, cable television and video companies and equipment
providers; pay-per-view television companies; companies involved in
emerging technologies for the broadcast and media industries; cellular
communications companies; companies involved in the development,
syndication and transmission of television, movie programming,
advertising and cellular communications; companies that distribute
data-based information; and other companies involved in the ownership,
operation, or development of media products or services.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
NATURAL GAS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the production, transmission, and
distribution of natural gas, and involved in the exploration of
potential natural gas sources, as well as those companies that provide
services and equipment to natural gas producers, refineries,
cogeneration facilities, converters, and distributors. These companies
may include, for example, companies involved in the production,
refinement, transmission, distribution, marketing, control, or
measurement of natural gas; companies involved in exploration of
potential natural gas sources; companies involved in natural gas
research or experimentation; companies working toward the solution of
energy problems, such as energy conservation or pollution control
through the use of natural gas; companies working toward technological
advances in the natural gas field; and other companies providing
equipment or services to the field.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
NATURAL RESOURCES PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks and
in certain precious metals. FMR invests the fund's assets primarily in
companies that own or develop natural resources, or supply goods and
services to such companies.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in owning or developing natural
resources, or supplying goods and services to such companies, and in
precious metals. These companies may include, for example, companies
involved either directly or through subsidiaries in exploring, mining,
refining, processing, transporting, fabricating, dealing in, or owning
natural resources. Natural resources include precious metals (e.g.,
gold, platinum, and silver), ferrous and nonferrous metals (e.g.,
iron, aluminum, and copper), strategic metals (e.g., uranium and
titanium), hydrocarbons (e.g., coal, oil, and natural gases),
chemicals, forest products, real estate, food, textile and tobacco
products, and other basic commodities. FMR treats investments in
instruments whose value is linked to the price of precious metals as
investments in precious metals.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
PAPER AND FOREST PRODUCTS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the manufacture, research, sale,
or distribution of paper products, packaging products, building
materials (such as lumber and paneling products), and other products
related to the paper and forest products industry. These companies may
include, for example, paper production and office product companies,
printers, and publishers.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
PRECIOUS METALS AND MINERALS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks and
in certain precious metals. FMR invests the fund's assets primarily in
companies engaged in exploration, mining, processing, or dealing in
gold, silver, platinum, diamonds, or other precious metals and
minerals.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in exploration, mining, processing,
or dealing in gold, silver, platinum, diamonds, or other precious
metals and minerals, and in precious metals. These companies may
include, for example, companies that manufacture and distribute
precious metal and minerals products (such as jewelry, watches, and
metal foils and leaf). FMR treats investments in instruments whose
value is linked to the price of precious metals as investments in
precious metals.
FMR may also invest the fund's assets in securities of companies that
invest in other companies engaged in gold and other precious metal and
mineral-related activities.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
REGIONAL BANKS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in accepting deposits and making
commercial and principally non-mortgage consumer loans. These
companies concentrate their operations in a specific part of the
country and may include, for example, state chartered banks, savings
and loan institutions, banks that are members of the Federal Reserve
System, and U.S. institutions whose deposits are not insured by the
federal government. In addition, these companies may offer merchant
banking, consumer and commercial finance, discount brokerage, leasing
and insurance.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
RETAILING PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in merchandising finished goods and
services primarily to individual consumers. These companies may
include, for example, general merchandise retailers; drug and
department stores; suppliers of goods and services for homes and
yards; specialty retailers selling a single category of merchandise
such as food, apparel, jewelry, toys, electronics, computers or home
improvement products; motor vehicle and marine dealers; warehouse
membership clubs; mail order operations; and companies involved in
alternative selling methods such as direct telephone marketing, mail
order, membership warehouse clubs, computer, or video-based electronic
systems.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
SOFTWARE AND COMPUTER SERVICES PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in research, design, production or
distribution of products or processes that relate to software or
information-based services. These companies may include, for example,
companies that design products such as systems-level software (to run
the basic functions of a computer) or applications software (for one
type of work) for general use or use by certain industries or groups;
companies that provide communications software; and companies that
provide time-sharing services, computer consulting or facilities
management services, and data communications services.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
TECHNOLOGY PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in offering, using or developing
products, processes or services that will provide or will benefit
significantly from technological advances and improvements. These
companies may include, for example, companies that develop, produce or
distribute products or services in the computer, semi-conductor,
electronics, communications, health care, and biotechnology sectors.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
TELECOMMUNICATIONS PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the development, manufacture, or
sale of communications services or communications equipment. These
companies may include, for example, companies that provide traditional
local and long-distance telephone service or equipment; companies that
provide cellular, paging, local and wide area product networks or
equipment; companies that provide satellite, microwave and cable
television or equipment; and companies involved in new technologies
such as fiber optics, semiconductors, and data transmission.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
TRANSPORTATION PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in providing transportation services
or companies principally engaged in the design, manufacture,
distribution, or sale of transportation equipment. These companies may
include, for example, companies involved in the movement of freight or
people such as airline, railroad, ship, truck and bus companies;
equipment manufacturers (including makers of trucks, automobiles,
planes, containers, railcars or other modes of transportation and
related products); parts suppliers; companies that provide leasing and
maintenance for automobiles, trucks, containers, railcars and planes;
and companies that sell fuel-saving devices to the transportation
industry and those that sell insurance and software developed
primarily for transportation companies.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
UTILITIES GROWTH PORTFOLIO
FMR normally invests the fund's assets primarily in common stocks.
FMR normally invests at least 80% of the fund's assets in securities
of companies principally engaged in the public utilities industry and
companies deriving a majority of their revenues from their public
utility operations. These companies may include, for example,
companies that manufacture, produce, generate, transmit or sell gas or
electric energy; water supply, waste disposal and sewerage, and
sanitary service companies; and companies involved in the
communication field, including telephone, telegraph, satellite,
microwave and the provision of other communication facilities for the
public benefit.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
Because the fund is considered non-diversified, FMR may invest a
significant percentage of the fund's assets in a single issuer.
In buying and selling securities for the fund, FMR relies on
fundamental analysis of each issuer and its potential for success in
light of its current financial condition, its industry position, and
economic and market conditions. Factors considered include growth
potential, earnings estimates and management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR 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 FMR's
strategies do not work as intended, the fund may not achieve its
objective.
DESCRIPTION OF PRINCIPAL SECURITY TYPES
EQUITY SECURITIES represent an ownership interest, or the right to
acquire an ownership interest, in an issuer. Different types of equity
securities provide different voting and dividend rights and priority
in the event of the bankruptcy of the issuer. Equity securities
include common stocks, preferred stocks, convertible securities and
warrants.
PRINCIPAL INVESTMENT RISKS
Many factors affect each fund's performance. A fund's share price
changes daily based on changes in market conditions and interest rates
and in response to other economic, political or financial
developments. A fund's reaction to these events will be affected by
the types of the securities in which the fund invests, the financial
condition, industry and economic sector, and geographic location of an
issuer, and the fund's level of investment in the securities of that
issuer. Because FMR concentrates each fund's investments in a
particular industry or group of industries, each fund's performance is
expected to be closely tied to economic and market conditions within
that industry or group of industries and to be more volatile than the
performance of less concentrated funds. In addition, because FMR may
invest a significant percentage of the assets of each fund (except
Financial Services, Home Finance and Regional Banks) in a single
issuer, the fund's performance could be closely tied to the market
value of that one issuer and could be more volatile than the
performance of more diversified funds. When you sell your shares of a
fund, they could be worth more or less than what you paid for them.
The following factors may significantly affect a fund'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 than
small cap stocks, and "growth" stocks can react differently than
"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.
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.
INDUSTRY CONCENTRATION. Market conditions, interest rates, and
economic, regulatory or financial developments could significantly
affect a single industry or a group of related industries, and the
securities of companies in that industry or group of industries could
react similarly to these or other developments.
The AIR TRANSPORTATION industry can be significantly affected by
competition within the industry, domestic and foreign economies,
government regulation, and the price of fuel. Airline deregulation has
substantially diminished the government's role in the air transport
industry while promoting an increased level of competition. However,
regulations and policies of various domestic and foreign governments
can still affect the profitability of individual carriers as well as
the entire industry.
The AUTOMOTIVE industry can be highly cyclical and companies in the
industry may suffer periodic operating losses. The industry can be
significantly affected by labor relations and fluctuating component
prices. While most of the major manufacturers are large, financially
strong companies, many others are small and may be non-diversified in
both product line and customer base.
The BIOTECHNOLOGY industry can be significantly affected by patent
considerations, intense competition, rapid technological change and
obsolescence, and government regulation. Biotechnology companies may
have persistent losses during a new product's transition from
development to production, and revenue patterns may be erratic.
The BROKERAGE AND INVESTMENT MANAGEMENT industry can be significantly
affected by changes in regulations, brokerage commission structure,
and a competitive environment combined with the high operating
leverage inherent in companies in this industry. The performance of
companies in this industry can be closely tied to the stock and bond
markets and can suffer during market declines. Revenues often depend
on overall market activity.
The BUSINESS SERVICES AND OUTSOURCING industry is, in part, subject to
continued demand for such services as companies and other
organizations seek alternative, cost effective means to meet their
economic goals. The industry can be significantly affected by
competitive pressures, such as technological developments, fixed-rate
pricing, and the ability to attract and retain skilled employees.
The CHEMICAL industry can be significantly affected by intense
competition, product obsolescence, and government regulation. As
regulations are developed and enforced, chemical companies may be
required to alter or cease production of a product, to pay fines, to
pay for cleaning up a disposal site, or to agree to restrictions on
their operations. In addition, some of the materials and processes
used by these companies involve hazardous components. There are risks
associated with their production, handling and disposal.
The COMPUTER industry can be significantly affected by competitive
pressures. For example, as product cycles shorten and manufacturing
capacity increases, these companies could become increasingly subject
to aggressive pricing, which hampers profitability. Profitability can
also be affected by changing domestic and international demand,
research and development costs, and product obsolescence.
The CONSTRUCTION AND HOUSING industry can be significantly affected by
changes in government spending on housing subsidies, public works and
transportation facilities such as highways and airports, as well as
changes in interest rates, consumer confidence and spending, taxation,
demographic patterns, housing starts, and the level of new and
existing home sales.
The CONSUMER industries can be significantly affected by the
performance of the overall economy, interest rates, competition, and
consumer confidence. Success depends heavily on disposable household
income and consumer spending. Changes in demographics and consumer
tastes can also affect the demand for, and success of, consumer
products.
The CYCLICAL industries can be significantly affected by general
economic trends, including employment, economic growth and interest
rates, changes in consumer sentiment and spending, commodity prices,
legislation, government regulation and spending, import controls, and
worldwide competition. For example, commodity price declines and unit
volume reductions resulting from an over-supply of materials used in
cyclical industries can adversely affect those industries.
Furthermore, a company in the cyclical industries can be subject to
liability for environmental damage, depletion of resources, and
mandated expenditures for safety and pollution control.
The DEFENSE AND AEROSPACE industry can be significantly affected by
government defense and aerospace regulation and spending policies
because companies involved in the defense and aerospace industry rely
to a large extent on U.S. (and other) government demand for their
products and services. Defense spending is currently under pressure
from efforts to control the U.S. budget deficit.
The DEVELOPING COMMUNICATIONS industry can be significantly affected
by failure to obtain, or delays in obtaining, financing or regulatory
approval, intense competition, product compatibility, consumer
preferences, and rapid obsolescence.
The ELECTRONICS industry can be significantly affected by rapid
obsolescence, intense competition and global demand.
The ENERGY industry can be significantly affected by fluctuations in
price and supply of energy fuels caused by events relating to
international politics, energy conservation, the success of
exploration projects, and tax and other government regulations.
The ENERGY SERVICE industry can be significantly affected by the
supply of and demand for specific products or services, the supply of
and demand for oil and gas, the price of oil and gas, exploration and
production spending, government regulation, world events, and economic
conditions.
The ENVIRONMENTAL SERVICES industry can be significantly affected by
intense competition and legislation resulting in more strict
government regulations and enforcement policies for both commercial
and governmental generators of waste materials as well as specific
expenditures designated for remedial cleanup efforts. As regulations
are developed and enforced, companies may be required to alter or
cease production of a product or service or to agree to restrictions
on their operations. In addition, hazardous materials involved in
environmental services present significant liability risk.
The FINANCIAL SERVICES industries are subject to extensive government
regulation which can limit both the amounts and types of loans and
other financial commitments they can make, and the interest rates and
fees they can charge. Profitability is largely dependent on the
availability and cost of capital funds, and can fluctuate
significantly when interest rates change. Credit losses resulting from
financial difficulties of borrowers can negatively affect the
financial services industries. Insurance companies can be subject to
severe price competition. The financial services industries are
currently undergoing relatively rapid change as existing distinctions
between financial service segments become less clear. For instance,
recent business combinations have included insurance, finance, and
securities brokerage under single ownership. Some primarily retail
corporations have expanded into securities and insurance industries.
Moreover, the federal laws generally separating commercial and
investment banking are currently being studied by Congress.
The FOOD AND AGRICULTURE industry can be significantly affected by
demographic and product trends, food fads, marketing campaigns, and
environmental factors. In the United States, the agricultural products
industry is subject to regulation by numerous federal and state
government agencies.
The GOLD industry can be significantly affected by international
monetary and political developments such as currency devaluations or
revaluations, central bank movements, economic and social conditions
within a country, trade imbalances, or trade or currency restrictions
between countries. The prices of gold and other precious metal mining
securities can be subject to substantial fluctuations over short
periods of time. Because much of the world's gold reserves are located
in South Africa, the social and economic conditions there and in
neighboring countries can affect gold and gold-related companies
located in South Africa and worldwide.
The HEALTH CARE industries are subject to government regulation and
government approval of products and services, which could have a
significant effect on price and availability. Furthermore, the types
of products or services produced or provided by health care companies
quickly can become obsolete.
The HOME FINANCE industry can be significantly affected by regulatory
changes, interest rate movements, home mortgage demand, refinancing
activity and residential delinquency trends. The residential real
estate finance industry has changed rapidly over the last decade.
Regulatory changes at federally insured institutions, in response to a
high failure rate, have mandated higher capital ratios and more
prudent underwriting. This reduced capacity has created growth
opportunities for uninsured companies and secondary market products to
fill unmet demand for home finance. Change continues in the
origination, packaging, selling, holding, and insuring of home finance
products.
The INDUSTRIAL EQUIPMENT industry can be significantly affected by
overall capital spending levels, which are influenced by an individual
company's profitability and broader factors such as interest rates and
foreign competition. The industrial equipment industry can also be
significantly affected by economic cycles, technical obsolescence,
labor relations, and government regulations.
The INDUSTRIAL MATERIALS industry can be significantly affected by the
level and volatility of commodity prices, the exchange value of the
dollar, import controls, and worldwide competition. At times,
worldwide production of industrial materials has exceeded demand as a
result of over-building or economic downturns, which leads to
commodity price declines and unit price reductions. Companies in the
industry can also be adversely affected by liability for environmental
damage, depletion of resources, and mandated expenditures for safety
and pollution control.
The INSURANCE industry can be significantly affected by interest
rates, general economic conditions, and price and marketing
competition. Property and casualty insurance profits can be affected
by weather catastrophes and other natural disasters. Life and health
insurance profits can be affected by mortality and morbidity rates.
Insurance companies can be adversely affected by inadequacy of cash
reserves, the inability to collect from reinsurance carriers,
liability for the coverage of environmental clean-up costs from past
years, and as yet unanticipated liabilities. Also, insurance companies
are subject to extensive government regulation, including the
imposition of maximum rate levels, and can be adversely affected by
proposed or potential tax law changes.
The LEISURE industry can be significantly affected by changing
consumer tastes and intense competition. The industry has reacted
strongly to technological developments and to the threat of government
regulation.
The MEDICAL DELIVERY industry is subject to extensive government
regulation, and can be significantly affected by government
reimbursement for medical expenses. Federal and state governments
provide a substantial percentage of revenues to health care service
providers via Medicare and Medicaid. The industry can also be
significantly affected by rising costs of medical products and
services, a shift away from traditional health insurance toward health
maintenance organizations, and increased emphasis on outpatient
services.
The MEDICAL EQUIPMENT AND SYSTEMS industry can be significantly
affected by patent considerations, rapid technological change and
obsolescence, government regulation, and government reimbursement for
medical expenses.
The MULTIMEDIA industry can be significantly affected by the federal
deregulation of cable and broadcasting, competitive pressures, and
government regulation, including regulation of the concentration of
investment in AM, FM, or TV stations.
The NATURAL GAS industry is subject to changes in price and supply of
both conventional and alternative energy sources. Swift price and
supply fluctuations may be caused by events relating to international
politics, energy conservation, the success of energy source
exploration projects, and tax and other domestic and foreign
government regulations.
The NATURAL RESOURCES industries can be significantly affected by
events relating to international political and economic developments,
energy conservation, the success of exploration projects, and tax and
other government regulations.
The PAPER AND FOREST PRODUCTS industry can be significantly affected
by the health of the economy, worldwide production capacity, and
interest rates, which may affect product pricing, costs and operating
margins. These variables can also affect the level of industry and
consumer capital spending for paper and forest products.
The PRECIOUS METALS AND MINERALS industry can be significantly
affected by international monetary and political developments such as
currency devaluations or revaluations, economic and social conditions
within a country, trade imbalances, or trade or currency restrictions
between countries. The prices of precious metal mining securities can
be subject to substantial fluctuations over short periods of time.
Because much of the world's gold reserves are located in South Africa,
the social and economic conditions there and in neighboring countries
can affect gold and gold-related companies located in South Africa and
worldwide.
The REGIONAL BANKINg industry can be significantly affected by
legislation currently being considered that would reduce the
separation between commercial and investment banking businesses and
could change the laws governing capitalization and the savings and
loan industry. The services offered by banks could expand if
legislation broadening bank powers is enacted. While providing
diversification, expanded powers could expose banks to
well-established competitors, particularly as the historical
distinctions between regional banks and other financial institutions
erode. Increased competition can also result from the broadening of
regional and national interstate banking powers, which has already
reduced the number of publicly traded regional banks. In addition,
general economic conditions are important to regional banks which face
exposure to credit losses and are significantly affected by changes in
interest rates.
The RETAIL industry can be significantly affected by consumer
spending, which is affected by general economic conditions and
consumer confidence levels. The retailing industry is highly
competitive, and a company's success is often tied to its ability to
anticipate changing consumer tastes.
The SOFTWARE AND COMPUTER SERVICES industry can be significantly
affected by competitive pressures. For example, an increasing number
of companies and new product offerings can lead to aggressive pricing
and slower selling cycles.
The TECHNOLOGY industries can be significantly affected by
obsolescence of existing technology, short product cycles, falling
prices and profits, and competition from new market entrants.
The TELECOMMUNICATIONS industry, particularly telephone operating
companies, is subject to both federal and state government regulations
of rates of return and services that may be offered. Many
telecommunications companies fiercely compete for market share.
The TRANSPORTATION industry can be significantly affected by changes
in the economy, fuel prices, labor relations, and insurance costs. The
trend in the United States has been to deregulate the transportation
industry, which could have a favorable long-term effect, but future
government decisions may adversely affect transportation companies.
The UTILITIES industries can be significantly affected by government
regulation, financing difficulties, supply and demand of services or
fuel, and natural resource conservation.
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 value of an issuer's
securities. The value of securities of smaller, less well-known
issuers can be more volatile than that of larger issuers. Smaller
issuers can have more limited product lines, markets or financial
resources.
In response to market, economic, political or other conditions, FMR
may temporarily use a different investment strategy for defensive
purposes. If FMR does so, different factors could affect a fund's
performance and the fund may not achieve its investment objective.
THE MONEY MARKET FUND
INVESTMENT OBJECTIVE
MONEY MARKET PORTFOLIO seeks to provide high current income,
consistent with preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR invests the fund's assets in U.S. dollar-denominated money market
securities of domestic and foreign issuers, including U.S. Government
securities and repurchase agreements. FMR also may enter into reverse
repurchase agreements for the fund. FMR invests at least 80% of the
fund's assets in money market instruments.
FMR will invest more than 25% of the fund's total assets in the
financial services industry.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
DESCRIPTION OF PRINCIPAL SECURITY TYPES
MONEY MARKET SECURITIES are high-quality, short-term se curities
that pay a fixed, variable or floating interest rate. Securities are
often specifically structured so that they are eligible investments
for a money market fund. For example, in order to satisfy the maturity
restrictions for a money market fund, some money market securities
have demand or put features which have the effect of shortening the
security's maturity. Taxable money market securities include bank
certificates of deposit, bank acceptances, bank time deposits, notes,
commercial paper and U.S. Government securities.
PRINCIPAL INVESTMENT RISKS
Many factors affect the fund's performance. The fund's yield will
change daily based on changes in interest rates and other market
conditions. Although the fund is managed to maintain a stable $1.00
share price, there is no guarantee that the fund will be able to do
so. For example, a major increase in interest rates or a decrease in
the credit quality of the issuer of one of the fund's investments
could cause the fund's share price to decrease. While the fund will be
charged premiums by a mutual insurance company for coverage of
specified types of losses related to default or bankruptcy on certain
securities, the fund may incur losses regardless of the insurance.
The following factors may significantly affect the fund's performance:
INTEREST RATE CHANGES. Money market securities have varying levels of
sensitivity to changes in interest rates. In general, the price of a
money market security can fall when interest rates rise and can rise
when interest rates fall. Securities with longer maturities and the
securities of issuers in the financial services sector can be more
sensitive to interest rate changes. Short-term securities tend to
react to changes in short-term interest rates.
FOREIGN EXPOSURE. Issuers located in foreign countries and entities
located in foreign countries that provide credit support or a
maturity-shortening structure can involve increased risks. Extensive
public information about the issuer or provider may not be available
and unfavorable political, economic or governmental developments could
affect the value of the security.
FINANCIAL SERVICES EXPOSURE. Financial services companies are highly
dependent on the supply of short-term financing. The value of
securities of issuers in the financial services sector can be
sensitive to changes in government regulation and interest rates and
to economic downturns in the United States and abroad.
ISSUER-SPECIFIC CHANGES. Changes in the financial condition of an
issuer, changes in specific economic or political conditions that
affect a particular type of issuer, and changes in general economic or
political conditions can affect the credit quality or value of an
issuer's securities. Entities providing credit support or a
maturity-shortening structure also can be affected by these types of
changes. If the structure of a security fails to function as intended,
the security could decline in value.
FUNDAMENTAL INVESTMENT POLICIES
The policies discussed below are fundamental, that is, subject to
change only by shareholder approval.
AIR TRANSPORTATION PORTFOLIO invests primarily in companies engaged in
the regional, national and international movement of passengers, mail,
and freight via aircraft.
AUTOMOTIVE PORTFOLIO invests primarily in companies engaged in the
manufacture, marketing or sale of automobiles, trucks, specialty
vehicles, parts, tires, and related services.
BIOTECHNOLOGY PORTFOLIO invests primarily in companies engaged in the
research, development, and manufacture of various biotechnological
products, services and processes.
BROKERAGE AND INVESTMENT MANAGEMENT PORTFOLIO invests primarily in
companies engaged in stock brokerage, commodity brokerage, investment
banking, tax-advantaged investment or investment sales, investment
management, or related investment advisory services.
BUSINESS SERVICES AND OUTSOURCING PORTFOLIO invests primarily in
companies that provide business-related services to companies and
other organizations.
CHEMICALS PORTFOLIO invests primarily in companies engaged in the
research, development, manufacture or marketing of products or
services related to the chemical process industries.
COMPUTERS PORTFOLIO invests primarily in companies engaged in
research, design, development, manufacture or distribution of
products, processes or services that relate to currently available or
experimental hardware technology within the computer industry.
CONSTRUCTION AND HOUSING PORTFOLIO invests primarily in companies
engaged in the design and construction of residential, commercial,
industrial and public works facilities, as well as companies engaged
in the manufacture, supply, distribution or sale of products or
services to these construction industries.
CONSUMER INDUSTRIES PORTFOLIO invests primarily in companies engaged
in the manufacture and distribution of goods to consumers both
domestically and internationally.
CYCLICAL INDUSTRIES PORTFOLIO invests primarily in companies engaged
in the research, development, manufacture, distribution, supply, or
sale of materials, equipment, products or services related to cyclical
industries.
DEFENSE AND AEROSPACE PORTFOLIO invests primarily in companies engaged
in the research, manufacture or sale of products or services related
to the defense or aerospace industries.
DEVELOPING COMMUNICATIONS PORTFOLIO invests primarily in companies
engaged in the development, manufacture or sale of emerging
communications services or equipment.
ELECTRONICS PORTFOLIO invests primarily in companies engaged in the
design, manufacture, or sale of electronic components (semiconductors,
connectors, printed circuit boards and other components); equipment
vendors to electronic component manufacturers; electronic component
distributors; and electronic instruments and electronic systems
vendors.
ENERGY PORTFOLIO invests primarily in companies in the energy field,
including the conventional areas of oil, gas, electricity and coal,
and newer sources of energy such as nuclear, geothermal, oil shale and
solar power.
ENERGY SERVICE PORTFOLIO invests primarily in companies in the energy
service field, including those that provide services and equipment to
the conventional areas of oil, gas, electricity and coal, and newer
sources of energy such as nuclear, geothermal, oil shale and solar
power.
ENVIRONMENTAL SERVICES PORTFOLIO invests primarily in companies
engaged in the research, development, manufacture or distribution of
products, processes or services related to waste management or
pollution control.
FINANCIAL SERVICES PORTFOLIO invests primarily in companies that
provide financial services to consumers and industry.
FOOD AND AGRICULTURE PORTFOLIO invests primarily in companies engaged
in the manufacture, sale, or distribution of food and beverage
products, agricultural products, and products related to the
development of new food technologies.
GOLD PORTFOLIO invests primarily in companies engaged in exploration,
mining, processing, or dealing in gold, or, to a lesser degree, in
silver, platinum, diamonds, or other precious metals and minerals.
HEALTH CARE PORTFOLIO invests primarily in companies engaged in the
design, manufacture, or sale of products or services used for or in
connection with health care or medicine.
HOME FINANCE PORTFOLIO invests primarily in companies engaged in
investing in real estate, usually through mortgages and other
consumer-related loans.
INDUSTRIAL EQUIPMENT PORTFOLIO invests primarily in companies engaged
in the manufacture, distribution or service of products and equipment
for the industrial sector, including integrated producers of capital
equipment (such as general industrial machinery, farm equipment, and
computers), parts suppliers and subcontractors.
INDUSTRIAL MATERIALS PORTFOLIO invests primarily in companies engaged
in the manufacture, mining, processing, or distribution of raw
materials and intermediate goods used in the industrial sector.
INSURANCE PORTFOLIO invests primarily in companies engaged in
underwriting, reinsuring, selling, distributing, or placing of
property and casualty, life, or health insurance.
LEISURE PORTFOLIO invests primarily in companies engaged in the
design, production, or distribution of goods or services in the
leisure industries.
MEDICAL DELIVERY PORTFOLIO invests primarily in companies engaged in
the ownership or management of hospitals, nursing homes, health
maintenance organizations, and other companies specializing in the
delivery of health care services.
MEDICAL EQUIPMENT AND SYSTEMS PORTFOLIO invests primarily in companies
engaged in research, development, manufacture, distribution, supply or
sale of medical equipment and devices and related technologies.
MULTIMEDIA PORTFOLIO invests primarily in companies engaged in the
development, production, sale and distribution of goods or services
used in the broadcast and media industries.
NATURAL GAS PORTFOLIO invests primarily in companies engaged in the
production, transmission, and distribution of natural gas, and
involved in the exploration of potential natural gas sources, as well
as those companies that provide services and equipment to natural gas
producers, refineries, cogeneration facilities, converters, and
distributors.
NATURAL RESOURCES PORTFOLIO invests primarily in companies that own or
develop natural resources, or supply goods and services to such
companies.
PAPER AND FOREST PRODUCTS PORTFOLIO invests primarily in companies
engaged in the manufacture, research, sale, or distribution of paper
products, packaging products, building materials (such as lumber and
paneling products), and other products related to the paper and forest
products industry.
PRECIOUS METALS AND MINERALS PORTFOLIO invests primarily in companies
engaged in exploration, mining, processing or dealing in gold, silver,
platinum, diamonds or other precious metals and minerals.
REGIONAL BANKS PORTFOLIO invests primarily in companies engaged in
accepting deposits and making commercial and principally non-mortgage
consumer loans.
RETAILING PORTFOLIO invests primarily in companies engaged in
merchandising finished goods and services primarily to individual
consumers.
SOFTWARE AND COMPUTER SERVICES PORTFOLIO invests primarily in
companies engaged in research, design, production or distribution of
products or processes that relate to software or information-based
services.
TECHNOLOGY PORTFOLIO invests primarily in companies which FMR believes
have, or will develop, products, processes or services that will
provide or will benefit significantly from technological advances and
improvements.
TELECOMMUNICATIONS PORTFOLIO invests primarily in companies engaged in
the development, manufacture, or sale of communications services or
communications equipment.
TRANSPORTATION PORTFOLIO invests primarily in companies engaged in
providing transportation services or companies engaged in the design,
manufacture, distribution, or sale of transportation equipment.
UTILITIES GROWTH PORTFOLIO invests primarily in companies in the
public utilities industry and companies deriving a majority of their
revenues from their public utility operations.
MONEY MARKET PORTFOLIO seeks to provide high current income,
consistent with preservation of capital and liquidity, by investing in
a broad range of high quality money market instruments.
EACH STOCK FUND seeks capital appreciation.
With the exception of Business Services and Outsourcing, Cyclical
Industries, Medical Equipment and Systems, and Natural Resources, each
stock fund seeks to achieve its investment objective by investing
primarily in equity securities, including common stocks and securities
convertible into common stocks, and for Gold and Precious Metals and
Minerals, in certain precious metals. For each stock fund (except
Business Services and Outsourcing, Cyclical Industries, Medical
Equipment and Systems, and Natural Resources), FMR does not place any
emphasis on income when selecting securities, except when it believes
that income may have a favorable effect on a security's market value.
When FMR considers it appropriate for defensive purposes, each stock
fund (except Business Services and Outsourcing, Cyclical Industries,
Medical Equipment and Systems, and Natural Resources) may temporarily
invest substantially in investment-grade debt securities.
VALUING SHARES
Each fund is open for business each day the New York Stock Exchange
(NYSE) is open.
Each fund's net asset value per share (NAV) is the value of a single
share. Fidelity normally calculates each stock fund's NAV as of each
hour, from 10:00 a.m. to the close of business of the NYSE, normally
4:00 p.m. Eastern time. On days when the NYSE closes early, Fidelity
will calculate the last NAV for the stock funds as of the close of the
NYSE. In addition, Fidelity will not calculate a stock fund's NAV if
trading on the NYSE is restricted or as permitted by the Securities
and Exchange Commission (SEC). Fidelity normally calculates the money
market fund's NAV as of the close of the NYSE, normally 4:00 p.m.
Eastern time. However, the money market fund's NAV may be calculated
earlier if trading on the NYSE is restricted or as permitted by the
SEC. Each fund's assets are valued as of these times for the purpose
of computing the fund's NAV.
To the extent that each 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 a fund's assets may not occur on days when the fund
is open for business.
The money market fund's assets are valued on the basis of amortized
cost.
Each stock fund's assets are valued primarily on the basis of market
quotations. Certain short-term securities are valued on the basis of
amortized cost. If market quotations are not readily available for a
security or if a security's value 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 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 funds 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 a fund and the account features and
policies may differ. Additional fees may also apply to your investment
in a 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 each fund is the fund's offering price
or the fund's NAV, depending on whether you pay a sales charge.
If you pay a sales charge, your price will be the fund's offering
price. When you buy shares of a fund at the offering price, Fidelity
deducts the appropriate sales charge and invests the rest in the fund.
If you qualify for a sales charge waiver, your price will be the
fund's NAV.
The offering price of each fund is its NAV divided by the difference
between one and the applicable sales charge percentage. The maximum
sales charge is 3.00% of the offering price.
Your shares will be bought at the next offering price or NAV, as
applicable, calculated after your investment is received in proper
form.
Short-term or excessive trading into and out of a fund may harm
performance by disrupting portfolio management strategies and by
increasing expenses. Accordingly, a 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
that fund. For these purposes, FMR may consider an investor's trading
history in that fund or other Fidelity funds, and accounts under
common ownership or control.
Each 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 a fund or
Fidelity has incurred.
(small solid bullet) If you do not specify a particular stock fund,
your investment will be made in the money market fund until Fidelity
receives instructions in proper form from you.
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 a 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 $2,500
For certain Fidelity retirement accountsA $500
TO ADD TO AN ACCOUNT $250
Through regular investment plans $100
MINIMUM BALANCE $2,000
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, each 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.
Call the phone number at left.
TO ADD TO AN ACCOUNT
(small solid bullet) Exchange
from another Fidelity fund.
Call the phone number at left.
(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) Direct
Deposit is not available for
Select stock funds.
(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 money market fund is the fund's
NAV. The price to sell one share of each stock fund is the fund's NAV
minus the applicable redemption fee (trading fee).
Each stock fund will deduct a trading fee of $7.50 or 0.75%, depending
on how long you held your shares, from the redemption amount when you
sell your shares. For stock fund shares held 29 days or less, the
trading fee is equal to 0.75% of the redemption amount. For stock fund
shares held 30 days or more, the trading fee is equal to the lesser of
$7.50 or 0.75% of the redemption amount. This fee is paid to the fund
rather than Fidelity, and is designed to offset the brokerage
commissions, market impact, and other costs associated with
fluctuations in fund asset levels and cash flow caused by shareholder
trading.
If you bought shares on different days, the shares you held longest
will be redeemed first for purposes of determining the trading fee.
The 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 applicable trading fee.
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 $2,000 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
a fund.
(small solid bullet) Redemption proceeds 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. Exchange proceeds are paid from one Select fund to another
Select fund or to another Fidelity equity fund in three business days.
Exchange proceeds are recorded in your shareholder account when the
transaction occurs.
(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 a 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.
AUTOMATICALLY (small solid bullet) Use
Personal Withdrawal Service
to set up periodic
redemptions from your stock
fund account.
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 a
fund for shares of other Fidelity 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) You may pay a $7.50 fee for each exchange out of
the stock funds, unless you place your transaction through Fidelity's
automated exchange services.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Although there is no limit on the number of
exchanges you may make between the Select funds, the funds may enact
limitations in the future. Each fund may temporarily or permanently
terminate the exchange privilege of any investor who makes more than
four exchanges out of the Select funds to other Fidelity funds per
calendar year. Accounts under common ownership or control will be
counted together for purposes of the four exchange limit.
(small solid bullet) Each fund may reject exchange purchases in excess
of 1% of its net assets or $1 million, whichever is less.
(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) Each fund may refuse exchange purchases by any
person or group if, in FMR's 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 funds may terminate or modify the exchange privileges 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
funds.
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(registered
trademark) 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.
MINIMUM FREQUENCY PROCEDURES
$100 Every pay period (small solid bullet) Not
available for Select stock
funds.
(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.
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>
PERSONAL WITHDRAWAL SERVICE
TO SET UP PERIODIC
REDEMPTIONS FROM YOUR STOCK
FUND ACCOUNT TO YOU OR TO
YOUR BANK ACCOUNT.
FREQUENCY PROCEDURES
Monthly (small solid bullet) To set
up, call 1-800-544-6666.
(small solid bullet) To make
changes, call Fidelity at
1-800-544-6666 at least
three business days prior to
your next scheduled
withdrawal date.
(small solid bullet) Because
of each fund's front-end
sales charge, you may not
want to set up a systematic
withdrawal program when you
are buying shares on a
regular basis.
OTHER FEATURES. The following other features are also available to buy
and sell shares of the funds.
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(registered trademark)
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 a 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 a fund to withhold 31% of your taxable distributions and
redemptions.
Fidelity may deduct an ANNUAL MAINTENANCE FEE of $12.00 from accounts
with a value of less than $2,500 (including any amount paid as a sales
charge), subject to an annual maximum charge of $24.00 per
shareholder. It is expected that accounts will be valued on the second
Friday in November of each year. Accounts opened after September 30
will not be subject to the fee for that year. The fee, which is
payable to Fidelity, is designed to offset in part the relatively
higher costs of servicing smaller accounts. This fee will not be
deducted from Fidelity brokerage accounts, retirement accounts (except
non-prototype retirement accounts), accounts using regular investment
plans, or if total assets with Fidelity exceed $30,000. Eligibility
for the $30,000 waiver is determined by aggregating accounts with
Fidelity maintained by Fidelity Service Company, Inc. or FBSI which
are registered under the same social security number or which list the
same social security number for the custodian of a Uniform
Gifts/Transfers to Minors Act account.
If your ACCOUNT BALANCE falls below $2,000 (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 applicable trading fee for
the stock funds, 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
Each fund earns dividends, interest and other income from its
investments, and distributes this income (less expenses) to
shareholders as dividends. Each fund also realizes capital gains from
its investments, and distributes these gains (less any losses) to
shareholders as capital gains distributions.
Each stock fund normally pays dividends and capital gains
distributions in April and December.
Distributions you receive from the money market fund consist primarily
of dividends. The money market fund normally declares dividends daily
and pays them monthly.
EARNING DIVIDENDS
For the money market fund, shares begin to earn dividends on the first
business day following the day of purchase.
For the money market fund, shares earn dividends until, but not
including, the next business day following the day of redemption.
When you exchange from a stock fund to the money market fund, you will
earn dividends the next business day. When you exchange from the money
market fund to a stock fund, you will earn dividends until, but not
including, the next business day following the day of redemption.
Exchange proceeds are paid from one Select fund to another or from a
Select fund to a Fidelity equity fund in three business days. As a
result, the delay in paying exchange proceeds when exchanging between
the money market fund and a stock fund or a Fidelity equity fund could
result in a lower or more volatile money market fund yield.
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
each 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. (stock funds only) 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 a 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 each fund are
subject to federal income tax, and may also be subject to state or
local taxes.
For federal tax purposes, each fund's dividends and distributions of
short-term capital gains are taxable to you as ordinary income. Each
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 (stock funds only) 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 a fund will normally be
taxable to you when you receive them, regardless of your distribution
option. For the money market fund, if you elect to receive
distributions in cash or to invest distributions automatically in
shares of another Fidelity fund, you will receive certain December
distributions in January, but those distributions will be taxable as
if you received them on December 31.
TAXES ON TRANSACTIONS. Your stock fund redemptions, including
exchanges, may result in a capital gain or loss for federal tax
purposes. A capital gain or loss on your investment in a fund is the
difference between the cost of your shares and the price you receive
when you sell them.
FUND SERVICES
FUND MANAGEMENT
Each fund is a mutual fund, an investment that pools shareholders'
money and invests it toward a specified goal.
FMR is each fund's manager.
As of April 30, 1998, FMR had approximately $5 2 9 billion
in discretionary assets under management.
As the manager, FMR is responsible for choosing the funds' investments
and handling their business affairs.
Affiliates assist FMR with foreign investments:
(small solid bullet) Fidelity Management & Research (U.K.) Inc. (FMR
U.K.), in London, England, serves as a sub-adviser for each stock
fund. FMR U.K. was organized in 1986 to provide investment research
and advice to FMR. Currently, FMR U.K. provides investment research
and advice on issuers based outside the United States and may also
provide investment advisory services for each stock fund.
(small solid bullet) Fidelity Management & Research Far East Inc. (FMR
Far East), in Tokyo, Japan, serves as sub-adviser for each stock fund.
FMR Far East was organized in 1986 to provide investment research and
advice to FMR. Currently, FMR Far East provides investment research
and advice on issuers based outside the United States and may also
provide investment advisory services for each stock fund.
Fidelity Investments Money Management, Inc. (FIMM), in Merrimack,
New Hampshire, serves as sub-adviser for the money market fund. FIMM
is primarily responsible for choosing investments for the money market
fund.
FIMM is an affiliate of FMR. As of May 1, 1998, F IMM had
approximately $ 99 billion in discretionary assets under
management.
A fund could be adversely affected if the computer systems used by FMR
and other service providers do not properly process and calculate
date-related information from and after January 1, 2000. FMR has
advised each fund that it is actively working on necessary changes to
its computer systems and expects that its 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.
Ramin Arani is manager of Retailing, which he has managed since
January 1997. Previously, he was an analyst. Mr. Arani joined Fidelity
as a research associate in 1992, after receiving his bachelor of arts
degree from Tufts University.
James Catudal is manager of Energy Service, which he has managed since
January 1998. Mr. Catudal joined Fidelity in 1997 as a research
analyst. Previously, he was an equity analyst with State Street
Research & Management. He received an MBA from the Amos Tuck School at
Dartmouth College in 1995.
Douglas Chase is manager of Consumer Industries, which he has managed
since August 1997. He also manages other Fidelity funds. Mr. Chase
joined Fidelity as an equity analyst in 1993 after receiving his MBA
from the University of Michigan.
Tim Cohen is manager of Insurance, which he has managed since February
1999. Mr. Cohen Joined Fidelity as an analyst in 1996, after receiving
an MBA from The Wharton School at the University of Pennsylvania.
Previously, he was a senior associate in the business assurance group
at Coopers & Lybrand (now PricewaterhouseCoopers LLP), Boston, from
1991 to 1994.
George Domolky is manager of Precious Metals and Minerals and Gold,
both of which he has managed since February 1997. Previously, he
managed Canada from 1987 to 1996 as well as other Fidelity funds. Mr.
Domolky joined Fidelity in 1981, and has worked as an analyst and
manager.
Jeff Dorsey is manager of Multimedia and Leisure, which he has managed
since December 1997 and January 1998, respectively. Since joining
Fidelity in 1991, Mr. Dorsey has worked as an analyst, senior analyst,
corporate strategist and manager.
Noah Eccles is manager of Paper and Forest Products, which he has
managed since January 1999. Previously, he worked as an analyst. Mr.
Eccles joined Fidelity as a research associate in 1997, after
receiving a bachelor of arts degree in economics from Trinity College
in 1992 and an MBA from The Wharton School at the University of
Pennsylvania in 1997.
Robert Ewing is Manager of Financial Services, which he has managed
since January 1998. He also manages another Fidelity fund. Since
joining Fidelity in 1990, Mr. Ewing has worked as a research
associate, analyst and manager.
Jeffrey Feingold is manager of Defense and Aerospace, which he has
managed since November 1998. Mr. Feingold joined Fidelity in 1997 and
has worked as an equity analyst following the apparel, textile and
footwear industries.
Subra Ghose is manager of Environmental Services, which he has managed
since October 1998. Since joining Fidelity in 1995, Mr. Ghose has
worked as an analyst following the electric and gas utilities
industries. Prior to this, Mr. Ghose received a bachelor of science
degree in computer science from Birla Institute of Technology, India,
in 1991, and an MBA from Northeastern University in 1996.
Matthew Grech is manager of Electronics, which he has managed since
June 1998. Mr. Grech joined Fidelity in 1996 as an equity analyst,
after receiving his MBA from the University of Chicago. Previously, he
was a mutual fund accountant for Franklin/Templeton, in California,
from 1993 to 1994.
Albert Grosman is manager of Automotive, which he has managed since
December 1997. Mr. Grosman joined Fidelity in 1996 as an analyst. He
received his MBA from Columbia University in 1997. From 1993 to 1995,
Mr. Grosman managed investment portfolios on a discretionary basis in
Toronto, Canada.
Peter Hirsch is manager of Industrial Materials, which he has managed
since September 1998. Mr. Hirsch joined Fidelity in 1995 as a
portfolio analyst. He received his Masters in Public and Private
Management (MPPM) at Yale School of Management in 1994 and began his
career as an associate at CS First Boston in New York.
Brian Hogan is manager of Construction and Housing, which he has
managed since April 1999. Since joining Fidelity in 1994, Mr. Hogan
has worked as a fixed income analyst, research analyst and manager.
Previously, he worked as an analyst for Conseco Capital Management
from 1993 to 1994.
Andrew Kaplan is manager of Developing Communications and Technology,
which he has managed since April 1998 and July 1998, respectively.
Previously, he managed another Fidelity fund. Mr. Kaplan joined
Fidelity as an analyst in 1995. Before that, he was an analyst with T.
Rowe Price in 1994 and an associate director of consulting for Edward
S. Gordon Company, in New York City, from 1988 through 1993.
Rajiv Kaul is manager of Biotechnology, which he has managed since
June 1998. Since joining Fidelity in 1996, Mr. Kaul has worked as a
research associate and equity analyst. He received a bachelor of arts
degree in government from Harvard College in 1995.
Yolanda McGettigan is manager of Regional Banks, which she has managed
since April 1999. Ms. McGettigan joined Fidelity as an analyst in
1997, after receiving her MBA from the Fuqua School of Business at
Duke University. Previously, she was employed as a sales
representative for Robinson-Humphrey from 1994 to 1995 and a trader
for Cantor Fitzgerald from 1992 to 1994.
Kerry Nelson is manager of Medical Equipment and Systems, which she
has managed since April 1998. Since joining Fidelity in 1995, Ms.
Nelson has worked as a research associate, analyst and manager.
Previously, she was an analyst with Grandview Partners, L.P., in
Boston, from 1991 to 1994.
Scott Offen is manager of Food and Agriculture, which he has managed
since November 1996. Previously, he managed other Fidelity funds.
Since joining Fidelity in 1985, Mr. Offen has worked as an analyst and
manager.
Ted Orenstein is manager of Brokerage and Investment Management, which
he has managed since January 1999. Mr. Orenstein joined Fidelity as an
analyst in May 1998, after receiving a bachelor's degree in business
administration from Babson College in 1994 and an MBA from The Wharton
School at the University of Pennsylvania in 1998.
John Porter is manager of Software and Computer Services and Medical
Delivery, which he has managed since June 1997 and January 1998,
respectively. Previously, he managed another Fidelity fund. Mr. Porter
joined Fidelity as an analyst in 1995, after receiving his MBA from
the University of Chicago.
Lawrence Rakers is manager of Energy and Natural Resources, which he
has managed since January 1997 and March 1997, respectively. He also
manages another Fidelity fund. Mr. Rakers joined Fidelity as an
analyst in 1993.
Albert Ruback is manager of Cyclical Industries, which he has managed
since inception. He also manages another Fidelity fund. Mr. Ruback
joined Fidelity as an analyst in 1991, after receiving his MBA from
Harvard Business School.
Peter Saperstone is manager of Telecommunications, which he has
managed since October 1998. Mr. Saperstone joined Fidelity in 1995 and
has worked as an analyst and manager.
Beso Sikharulidze is manager of Health Care, which he has managed
since June 1997. He also manages another Fidelity fund. Mr.
Sikharulidze joined Fidelity as an analyst in 1992, after receiving
his MBA from Harvard University.
Michael Tarlowe is manager of Business Services and Outsourcing
Portfolio, which he has managed since February 1998. Mr. Tarlowe
joined Fidelity in 1994 as an analyst, after receiving a bachelor of
business administration degree in finance from the University of
Michigan.
Michael Tempero is manager of Computers, which he has managed since
January 1997. He also manages another Fidelity fund. Mr. Tempero
joined Fidelity as an analyst in 1993, after receiving his MBA from
the University of Chicago.
Victor Thay is manager of Natural Gas and Home Finance , which
he has managed since December 1997 and March 1999,
respectively . Mr. Thay joined Fidelity as a research associate in
1995, after receiving undergraduate degrees in political science and
business administration from the University of California at Berkeley
in 1995.
Simon Wolf is manager of Industrial Equipment, which he has managed
since August 1997. Mr. Wolf joined Fidelity in 1996 as a research
associate. Previously, he worked for Salomon Brothers as an analyst
from 1993 to 1996. Mr. Wolf received a bachelor of science degree in
economics from the University of Pennsylvania in 1992.
Dylan Yolles is manager of Chemicals, which he has managed since
January 1999. Mr. Yolles joined Fidelity in 1997 as an equity analyst,
after receiving a bachelor of arts degree in 1991 and an MBA in 1997,
both from Stanford University.
Jonathan Zang is manager of Utilities Growth, which he has managed
since July 1998. Mr. Zang joined Fidelity in 1997 as an equity
analyst, after receiving his MBA from the University of Chicago in
1997. Previously, he was an investment officer with Hawaiian Trust
Company, in Honolulu, from 1992 to 1995.
Chris Zepf is Manager of Transportation and Air Transportation, which
he has managed since September 1998 and October 1998, respectively.
Mr. Zepf joined Fidelity in 1997 and has worked as an analyst and
manager.
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.
Each fund pays a management fee to FMR.
The management fee is calculated and paid to FMR every month. For the
stock funds, the fee is calculated by adding a group fee rate to an
individual fund fee rate, dividing by twelve, and multiplying the
result by the fund's average net assets throughout the month.
For the money market fund, the fee is calculated by adding a group fee
rate to an individual fund fee rate, dividing by twelve and
multiplying the result by the fund's average net assets throughout the
month, and then adding an income-based fee.
The income-based fee is 6% of the fund's monthly gross income in
excess of an annualized 5% yield, but it cannot rise above an annual
rate of 0.24% of the fund's average net assets throughout that month.
The group fee rate is based on the average net assets of all the
mutual funds advised by FMR. This rate cannot rise above 0.52% for
each stock fund or 0.37% for the money market fund, and it drops as
total assets under management increase.
For February 1999, the group fee rate wa s 0.2843 % for each
stock fund and the group fee rate was 0.1312 % for the money
market fund. The individual fund fee rate is 0.30% for each stock fund
and 0.03% for the money market fund.
The total management fee for the fiscal year ended February 28, 1999
for each fund, as a percentage of each fund's average net assets, is
shown in the table below.
Fund Management Fees
Air Transportation 0.58%
Automotive 0.59%
Biotechnology 0.59%
Brokerage and Investment 0.59%
Management
Business Services and 0.59%
Outsourcing
Chemicals 0.59%
Computers 0.60%
Construction and Housing 0.59%
Consumer Industries 0.59%
Cyclical Industries 0.59%
Defense and Aerospace 0.58%
Developing Communications 0.60%
Electronics 0.59%
Energy 0.59%
Energy Service 0.59%
Environmental Services 0.59%
Financial Services 0.59%
Food and Agriculture 0.59%
Gold 0.59%
Health Care 0.59%
Home Finance 0.58%
Industrial Equipment 0.59%
Industrial Materials 0.59%
Insurance 0.59%
Leisure 0.59%
Medical Delivery 0.59%
Medical Equipment and SystemsA 0.60%
Multimedia 0.59%
Fund Management Fees
Natural Gas 0.59%
Natural Resources 0.59%
Paper and Forest Products 0.59%
Precious Metals and Minerals 0.59%
Regional Banks 0.59%
Retailing 0.59%
Software and Computer Services 0.59%
Technology 0.60%
Telecommunications 0.59%
Transportation 0.58%
Utilities Growth 0.59%
Money Market 0.20%
A ANNUALIZED
FMR pays FIMM, FMR U.K. and FMR Far East for providing assistance with
investment advisory services.
FMR may, from time to time, agree to reimburse the funds for
management fees and other expenses above a specified limit. FMR
retains the ability to be repaid by a fund if expenses fall below the
specified limit prior to the end of the fiscal year. Reimbursement
arrangements, which may be terminated by FMR at any time, can decrease
a fund's expenses and boost its performance.
As of February 28, 1999, approximately 38.73% of Cyclical
Industries' total outstanding shares were held by an FMR
affiliate.
FUND DISTRIBUTION
FDC distributes each fund's shares.
You may pay a sales charge when you buy your shares.
FDC collects the sales charge.
Each fund's sales charge may be reduced if you buy directly through
Fidelity or through prototype or prototype-like retirement plans
sponsored by FMR or FMR Corp. The amount you invest, plus the value of
your account, must fall within the ranges shown below. Purchases made
with assistance or intervention from a financial intermediary are not
eligible for a sales charge reduction.
Sales Charge
Ranges As a % of offering price As an approximate % of net
amount invested
$0 - 249,999 3.00% 3.09%
$250,000 - 499,999 2.00% 2.04%
$500,000 - 999,999 1.00% 1.01%
$1,000,000 or more none none
FDC may pay a portion of sales charge proceeds to securities dealers
who have sold a fund's shares, or to others, including banks and other
financial institutions (qualified recipients), under special
arrangements in connection with FDC's sales activities. The sales
charge paid to qualified recipients is 1.50% of a fund's offering
price.
The sales charge will also be reduced by the percentage of any sales
charge you previously paid on investments in other Fidelity funds or
by the percentage of any sales charge you would have paid if the
reductions in the table above had not existed. These sales charge
credits only apply to purchases made in one of the ways listed below,
and only if you continuously owned Fidelity fund shares, maintained a
Fidelity brokerage core account, or participated in The CORPORATEplan
for Retirement Program.
1. By exchange from another Fidelity fund.
2. With proceeds from a transaction in a Fidelity brokerage core
account, including any free credit balance, core money market fund, or
margin availability, to the extent such proceeds were derived from
redemption proceeds from another Fidelity fund.
3. As a participant in The CORPORATEplan for Retirement Program when
shares are bought through plan-qualified loan repayments, and for
exchanges into and out of the Managed Income Portfolio.
A fund's sales charge will not apply:
1. If you buy shares as part of an employee benefit plan having more
than 200 eligible employees or a minimum of $3 million in plan assets
invested in Fidelity mutual funds.
2. To shares in a Fidelity account bought with the proceeds of a
distribution from an employee benefit plan, provided that at the time
of the distribution, the employer or its affiliate maintained a plan
that both qualified for waiver (1) above and had at least some of its
assets invested in Fidelity-managed products. (Distributions
transferred to an IRA account must be transferred within 60 days from
the date of the distribution. All other distributions must be
transferred directly into a Fidelity account).
3. If you are a charitable organization (as defined for purposes of
Section 501(c)(3) of the Internal Revenue Code) investing $100,000 or
more.
4. If you buy shares for a charitable remainder trust or life income
pool established for the benefit of a charitable organization (as
defined for purposes of Section 501(c)(3) of the Internal Revenue
Code).
5. If you are an investor participating in the Fidelity Trust
Portfolios program.
6. To shares bought by a mutual fund or a qualified state tuition
program for which FMR or an affiliate serves as investment manager.
7. To shares bought through Portfolio Advisory Services or Fidelity
Charitable Advisory Services.
8. If you are a current or former trustee or officer of a Fidelity
fund or a current or retired officer, director, or regular employee of
FMR Corp. or Fidelity International Limited or their direct or
indirect subsidiaries (a Fidelity trustee or employee), the spouse of
a Fidelity trustee or employee, a Fidelity trustee or employee acting
as custodian for a minor child, or a person acting as trustee of a
trust for the sole benefit of the minor child of a Fidelity trustee or
employee.
9. If you are a bank trust officer, registered representative, or
other employee of a qualified recipient, as defined on page .
More detailed information about waivers (1), (2) and (5) is contained
in the Statement of Additional Information (SAI). A representative of
your plan or organization should call Fidelity for more information.
To qualify for a sales charge reduction or waiver, you must notify
Fidelity in advance of your purchase.
To receive sales concessions and waivers, qualified recipients must
sign the appropriate agreement with FDC in advance.
FMR may allocate brokerage transactions in a manner that takes into
account the sale of shares of a 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 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 funds or FDC. This Prospectus
and the related SAI do not constitute an offer by the funds or by
FDC to sell shares of the funds or to buy shares of the funds to
any person to whom it is unlawful to make such offer.
APPENDIX
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand each
fund's financial history for the past 5 years (past 2 years for
Business Services and Outsourcing, Cyclical Industries and Natural
Resources, and past year for Medical Equipment and Systems). Certain
information reflects financial results for a single fund share. Total
returns for each period include the reinvestment of all dividends and
distributions. This information has been audited by
PricewaterhouseCoopers LLP , independent accountants, whose
report, along with each fund's financial highlights and financial
statements, are included in the funds' Annual Report. A free copy of
the Annual Report is available upon request.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
AIR TRANSPORTATION
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 26.86 $ 17.72 $ 21.11 $ 13.93 $ 17.12
period
Income from Investment
Operations
Net investment income (loss) (.14) (.19) (.22) (.01) (.18)
C
Net realized and unrealized 1.06 10.59 (3.12) 7.47 (2.01)
gain (loss)
Total from investment .92 10.40 (3.34) 7.46 (2.19)
operations
Less Distributions
From net realized gain (.21) (1.43) (.07) (.46) (.92)
In excess of net realized - - (.20) - (.17)
gain
Total distributions (.21) (1.43) (.27) (.46) (1.09)
Redemption fees added to paid .19 .17 .22 .18 .09
in capital
Net asset value, end of period $ 27.76 $ 26.86 $ 17.72 $ 21.11 $ 13.93
TOTAL RETURN A, B 4.11% 61.10% (15.06)% 54.91% (12.45)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 65,949 $ 181,185 $ 35,958 $ 75,359 $ 18,633
(000 omitted)
Ratio of expenses to average 1.35% 1.93% 1.89% 1.47% 2.50% D
net assets
Ratio of expenses to average 1.27% E 1.87% E 1.80% E 1.41% E 2.50%
net assets after expense
reductions
Ratio of net investment (.50)% (.84)% (1.10)% (.07)% (1.31)%
income (loss) to average net
assets
Portfolio turnover rate 260% 294% 469% 504% 200%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES, OR EXPENSES WERE
LIMITED IN ACCORDANCE WITH A
STATE EXPENSE LIMITATION.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
AUTOMOTIVE
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 27.50 $ 25.38 $ 21.85 $ 19.84 $ 25.48
period
Income from Investment
Operations
Net investment income C .03 .05 .13 .03 .08
Net realized and unrealized (2.09) 5.21 4.28 1.95 (3.46)
gain (loss)
Total from investment (2.06) 5.26 4.41 1.98 (3.38)
operations
Less Distributions
From net investment income (.01) (.08) (.17) - (.05)
From net realized gain (2.17) (3.09) (.75) - (2.26)
Total distributions (2.18) (3.17) (.92) - (2.31)
Redemption fees added to paid .02 .03 .04 .03 .05
in capital
Net asset value, end of period $ 23.28 $ 27.50 $ 25.38 $ 21.85 $ 19.84
TOTAL RETURN A, B (8.52)% 22.78% 20.60% 10.13% (12.59)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 64,541 $ 32,489 $ 86,347 $ 55,753 $ 60,075
(000 omitted)
Ratio of expenses to average 1.45% 1.60% 1.56% 1.81% 1.82%
net assets
Ratio of expenses to average 1.41% D 1.56% D 1.52% D 1.80% D 1.80% D
net assets after expense
reductions
Ratio of net investment .11% .17% .54% .13% .34%
income to average net assets
Portfolio turnover rate 96% 153% 175% 61% 63%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
BIOTECHNOLOGY
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 34.52 $ 34.24 $ 36.60 $ 25.30 $ 27.61
period
Income from Investment
Operations
Net investment income (loss) (.26) (.27) (.20) .11 (.06)
C
Net realized and unrealized 9.15 5.20 1.89 11.21 (2.26)
gain (loss)
Total from investment 8.89 4.93 1.69 11.32 (2.32)
operations
Less Distributions
From net investment income - - (.03) (.07) -
From net realized gain (2.09) (4.71) (4.06) - -
Total distributions (2.09) (4.71) (4.09) (.07) -
Redemption fees added to paid .03 .06 .04 .05 .01
in capital
Net asset value, end of period $ 41.35 $ 34.52 $ 34.24 $ 36.60 $ 25.30
TOTAL RETURN A, B 27.13% 16.11% 5.85% 44.97% (8.37)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 741,530 $ 579,542 $ 674,902 $ 1,096,864 $ 448,197
(000 omitted)
Ratio of expenses to average 1.34% 1.49% 1.57% 1.44% D 1.59%
net assets
Ratio of expenses to average 1.30% E 1.47% E 1.56% E 1.43% E 1.59%
net assets after expense
reductions
Ratio of net investment (.75)% (.81)% (.59)% .35% (.27)%
income (loss) to average net
assets
Portfolio turnover rate 86% 162% 41% 67% 77%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
BROKERAGE AND INVESTMENT MANAGEMENT
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 39.78 $ 25.76 $ 18.49 $ 15.51 $ 17.75
period
Income from Investment
Operations
Net investment income (loss) .10 .16 .08 .09 (.03)
C
Net realized and unrealized 1.72 14.46 7.80 4.29 (2.25)
gain (loss)
Total from investment 1.82 14.62 7.88 4.38 (2.28)
operations
Less Distributions
From net investment income (.01) (.09) (.06) (.04) -
From net realized gain (.52) (.61) (.65) (1.09) -
In excess of net realized - - - (.35) -
gain
Total distributions (.53) (.70) (.71) (1.48) -
Redemption fees added to paid .09 .10 .10 .08 .04
in capital
Net asset value, end of period $ 41.16 $ 39.78 $ 25.76 $ 18.49 $ 15.51
TOTAL RETURN A, B 4.76% 57.56% 44.27% 29.85% (12.62)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 482,525 $ 676,067 $ 458,787 $ 38,382 $ 27,346
(000 omitted)
Ratio of expenses to average 1.26% 1.33% 1.94% 1.64% D 2.54% D
net assets
Ratio of expenses to average 1.24% E 1.29% E 1.93% E 1.61% E 2.54%
net assets after expense
reductions
Ratio of net investment .26% .49% .37% .50% (.20)%
income (loss) to average net
assets
Portfolio turnover rate 59% 100% 16% 166% 139%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE .
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES, OR EXPENSES WERE
LIMITED IN ACCORDANCE WITH A
STATE EXPENSE LIMITATION.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
BUSINESS SERVICES AND OUTSOURCING
Years ended February 28, 1999 1998E
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 10.89 $ 10.00
period
Income from Investment
Operations
Net investment income (loss) (.11) -
D
Net realized and unrealized 2.92 .89
gain (loss)
Total from investment 2.81 .89
operations
Less Distributions
From net realized gain (.16) -
Redemption fees added to paid .03 -
in capital
Net asset value, end of period $ 13.57 $ 10.89
TOTAL RETURN B, C 26.23% 8.90%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 64,123 $ 15,915
(000 omitted)
Ratio of expenses to average 1.66% 2.50% A, F
net assets
Ratio of expenses to average 1.64% G 2.50% A
net assets after expense
reductions
Ratio of net investment (.91)% (.49)% A
income (loss) to average net
assets
Portfolio turnover rate 115% 36% A
A ANNUALIZED
B THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
C TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
D NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
E FOR THE PERIOD FEBRUARY 4,
1998 (COMMENCEMENT OF
OPERATIONS) TO FEBRUARY 28,
1998.
F FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
G FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
CHEMICALS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 45.90 $ 42.53 $ 39.53 $ 33.91 $ 31.66
period
Income from Investment
Operations
Net investment income (loss) .17 (.02) .28 .01 .36
C
Net realized and unrealized (10.77) 7.88 5.49 8.89 2.65
gain (loss)
Total from investment (10.60) 7.86 5.77 8.90 3.01
operations
Less Distributions
From net investment income (.05) - (.12) (.08) (.22)
From net realized gain (3.52) (4.54) (2.74) (3.22) (.60)
In excess of net realized (0.68) - - - -
gain
Total distributions (4.25) (4.54) (2.86) (3.30) (.82)
Redemption fees added to paid .05 .05 .09 .02 .06
in capital
Net asset value, end of period $ 31.10 $ 45.90 $ 42.53 $ 39.53 $ 33.91
TOTAL RETURN A, B (23.66)% 19.47% 15.06% 27.48% 9.90%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 31,862 $ 69,349 $ 111,409 $ 89,230 $ 97,511
(000 omitted)
Ratio of expenses to average 1.58% 1.68% 1.83% 1.99% 1.52%
net assets
Ratio of expenses to average 1.51% D 1.67% D 1.81% D 1.97% D 1.51% D
net assets after expense
reductions
Ratio of net investment .44% (.05)% .67% .04% 1.07%
income (loss) to average net
assets
Portfolio turnover rate 141% 31% 207% 87% 106%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
COMPUTERS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 41.08 $ 48.25 $ 41.03 $ 30.67 $ 27.02
period
Income from Investment
Operations
Net investment income (loss) (.29) (.32) (.36) (.23) (.31)
C
Net realized and unrealized 27.39 6.42 9.94 16.10 3.68
gain (loss)
Total from investment 27.10 6.10 9.58 15.87 3.37
operations
Less Distributions
From net realized gain - (10.64) (2.47) (5.61) -
In excess of net realized - (2.75) - - -
gain
Total distributions - (13.39) (2.47) (5.61) -
Redemption fees added to paid .19 .12 .11 .10 .28
in capital
Net asset value, end of period $ 68.37 $ 41.08 $ 48.25 $ 41.03 $ 30.67
TOTAL RETURN A, B 66.43% 20.33% 23.97% 52.79% 13.51%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 1,831,435 $ 785,465 $ 604,286 $ 527,337 $ 215,014
(000 omitted)
Ratio of expenses to average 1.25% 1.40% 1.48% 1.40% 1.71%
net assets
Ratio of expenses to average 1.23% D 1.34% D 1.44% D 1.38% D 1.69% D
net assets after expense
reductions
Ratio of net investment (.54)% (.67)% (.83)% (.56)% (1.12)%
income (loss) to average net
assets
Portfolio turnover rate 133% 333% 255% 129% 189%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
CONSTRUCTION AND HOUSING
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 25.63 $ 22.00 $ 19.56 $ 16.79 $ 19.82
period
Income from Investment
Operations
Net investment income (loss) (.06) (.25) .06 .07 (.02)
C
Net realized and unrealized (.53) 7.67 3.38 3.55 (2.50)
gain (loss)
Total from investment (.59) 7.42 3.44 3.62 (2.52)
operations
Less Distributions
From net investment income - (.02) (.02) (.07) -
From net realized gain (.06) (3.87) (1.03) (.81) (.52)
Total distributions (.06) (3.89) (1.05) (.88) (.52)
Redemption fees added to paid .04 .10 .05 .03 .01
in capital
Net asset value, end of period $ 25.02 $ 25.63 $ 22.00 $ 19.56 $ 16.79
TOTAL RETURN A, B (2.16)% 40.04% 18.64% 21.77% (12.54)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 51,652 $ 57,484 $ 30,581 $ 42,668 $ 16,863
(000 omitted)
Ratio of expenses to average 1.43% 2.50% D 1.41% 1.43% 1.76%
net assets
Ratio of expenses to average 1.37% E 2.43% E 1.35% E 1.40% E 1.74% E
net assets after expense
reductions
Ratio of net investment (.23)% (1.10)% .27% .39% (.11)%
income (loss) to average net
assets
Portfolio turnover rate 226% 404% 270% 139% 45%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSED DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
CONSUMER INDUSTRIES
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 27.31 $ 20.66 $ 17.84 $ 13.91 $ 15.24
period
Income from Investment
Operations
Net investment income (loss) (.04) (.22) (.22) .08 (.15)
C
Net realized and unrealized 5.41 8.34 2.93 3.97 (.60)
gain (loss)
Total from investment 5.37 8.12 2.71 4.05 (.75)
operations
Less Distributions
From net investment income - - - (.02) -
From net realized gain (.90) (1.52) - (.01) (.60)
In excess of net realized - - - (.20) -
gain
Total distributions (.90) (1.52) - (.23) (.60)
Redemption fees added to paid .03 .05 .11 .11 .02
in capital
Net asset value, end of period $ 31.81 $ 27.31 $ 20.66 $ 17.84 $ 13.91
TOTAL RETURN A, B 20.18% 40.36% 15.81% 30.01% (4.59)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 82,244 $ 72,152 $ 18,392 $ 22,362 $ 20,501
(000 omitted)
Ratio of expenses to average 1.34% 2.01% 2.49% 1.53% D 2.49% D
net assets
Ratio of expenses to average 1.32% E 1.97% E 2.44% E 1.48% E 2.49%
net assets after expense
reductions
Ratio of net investment (.15)% (.90)% (1.13)% .46% (1.08)%
income (loss) to average net
assets
Portfolio turnover rate 150% 199% 340% 601% 190%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES, OR EXPENSES WERE
LIMITED IN ACCORDANCE WITH A
STATE EXPENSE LIMITATION.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
CYCLICAL INDUSTRIES
Years ended February 28, 1999 1998 F
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 12.07 $ 10.00
period
Income from Investment
Operations
Net investment income (loss) (.13) (.11)
D
Net realized and unrealized (.49) 2.59
gain (loss)
Total from investment (.62) 2.48
operations
Less Distributions
From net realized gain (.09) (.46)
Redemption fees added to .03 .05
paid in capital
Net asset value, end of $ 11.39 $ 12.07
period
TOTAL RETURN B, C (4.96)% 25.77%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 3,087 $ 3,965
(000 omitted)
Ratio of expenses to average 2.50% E 2.50% A, E
net assets
Ratio of expenses to average 2.49% G 2.50% A
net assets after expense
reductions
Ratio of net investment (1.09)% (.93)% A
income (loss) to average net
assets
Portfolio turnover rate 103% 140% A
A ANNUALIZED
B THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
C TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
D NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
E FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
F FOR THE PERIOD MARCH 3,
1997 (COMMENCEMENT OF
OPERATIONS) TO FEBRUARY 28,
1998.
G FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
DEFENSE AND AEROSPACE
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 37.57 $ 28.94 $ 26.97 $ 19.64 $ 19.14
period
Income from Investment
Operations
Net investment income (loss) (.19) (.29) (.11) (.05) (.06)
D
Net realized and unrealized (3.61) 11.84 4.18 9.09 .70
gain (loss)
Total from investment (3.80) 11.55 4.07 9.04 .64
operations
Less Distributions
From net realized gain - (3.04) (2.17) (1.82) (.27)
Redemption fees added to paid .08 .12 .07 .11 .13
in capital
Net asset value, end of period $ 33.85 $ 37.57 $ 28.94 $ 26.97 $ 19.64
TOTAL RETURN A, B (9.90)% 42.68% 15.87% 47.40% 4.13%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 28,497 $ 101,805 $ 68,803 $ 26,648 $ 4,985
(000 omitted)
Ratio of expenses to average 1.48% 1.77% 1.84% 1.77% C 2.49% C
net assets
Ratio of expenses to average 1.42% E 1.71% E 1.81% E 1.75% E 2.49%
net assets after expense
reductions
Ratio of net investment (.53)% (.85)% (.39)% (.20)% (.32)%
income (loss) to average net
assets
Portfolio turnover rate 221% 311% 219% 267% 146%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES, OR EXPENSES WERE
LIMITED IN ACCORDANCE WITH A
STATE EXPENSE LIMITATION.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
D NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
DEVELOPING COMMUNICATIONS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 20.14 $ 19.68 $ 19.42 $ 20.40 $ 19.65
period
Income from Investment
Operations
Net investment income (loss) (.16) (.18) (.18) (.17) (.16)
C
Net realized and unrealized 12.72 4.95 .42 4.17 2.55
gain (loss)
Total from investment 12.56 4.77 .24 4.00 2.39
operations
Less Distributions
From net realized gain (.07) (4.35) - (5.00) (1.67)
Redemption fees added to paid .09 .04 .02 .02 .03
in capital
Net asset value, end of period $ 32.72 $ 20.14 $ 19.68 $ 19.42 $ 20.40
TOTAL RETURN A, B 63.01% 28.17% 1.34% 21.84% 13.63%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 612,061 $ 238,356 $ 220,360 $ 333,185 $ 254,426
(000 omitted)
Ratio of expenses to average 1.38% 1.61% 1.64% 1.53% 1.58%
net assets
Ratio of expenses to average 1.34% D 1.55% D 1.62% D 1.51% D 1.56% D
net assets after expense
reductions
Ratio of net investment (.64)% (.82)% (.86)% (.78)% (.83)%
income (loss) to average net
assets
Portfolio turnover rate 299% 383% 202% 249% 266%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ELECTRONICS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 34.99 $ 37.95 $ 28.18 $ 19.80 $ 17.67
period
Income from Investment
Operations
Net investment income (loss) (.23) (.17) (.17) (.08) (.18)
C
Net realized and unrealized 12.53 7.32 9.80 13.51 2.11
gain (loss)
Total from investment 12.30 7.15 9.63 13.43 1.93
operations
Less Distributions
From net realized gain - (7.60) - (5.25) -
In excess of net realized - (2.60) - - -
gain
Total distributions - (10.20) - (5.25) -
Redemption fees added to paid .05 .09 .14 .20 .20
in capital
Net asset value, end of period $ 47.34 $ 34.99 $ 37.95 $ 28.18 $ 19.80
TOTAL RETURN A, B 35.30% 24.15% 34.67% 72.75% 12.05%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 2,885,548 $ 2,668,750 $ 1,744,017 $ 1,133,362 $ 216,433
(000 omitted)
Ratio of expenses to average 1.18% 1.18% 1.33% 1.25% 1.72%
net assets
Ratio of expenses to average 1.15% D 1.12% D 1.29% D 1.22% D 1.71% D
net assets after expense
reductions
Ratio of net investment (.62)% (.42)% (.54)% (.28)% (.98)%
income (loss) to average net
assets
Portfolio turnover rate 160% 435% 341% 366% 205%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ENERGY
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 21.20 $ 21.31 $ 18.97 $ 16.10 $ 16.73
period
Income from Investment
Operations
Net investment income C .13 .11 .13 .18 .07
Net realized and unrealized (4.71) 3.93 3.59 3.13 (.11)
gain (loss)
Total from investment (4.58) 4.04 3.72 3.31 (.04)
operations
Less Distributions
From net investment income (.02) E (.09) (.13) (.11) (.08)
From net realized gain (.40)E (4.09) (1.31) (.36) (.54)
Total distributions (.42) (4.18) (1.44) (.47) (.62)
Redemption fees added to paid .03 .03 .06 .03 .03
in capital
Net asset value, end of period $ 16.23 $ 21.20 $ 21.31 $ 18.97 $ 16.10
TOTAL RETURN A, B (22.00)% 20.40% 20.35% 20.92% .04%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 120,004 $ 147,023 $ 203,265 $ 119,676 $ 96,023
(000 omitted)
Ratio of expenses to average 1.46% 1.58% 1.57% 1.63% 1.85%
net assets
Ratio of expenses to average 1.42% D 1.53% D 1.55% D 1.63% 1.85%
net assets after expense
reductions
Ratio of net investment .68% .47% .62% 1.04% .42%
income to average net assets
Portfolio turnover rate 138% 115% 87% 97% 106%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E AMOUNTS SHOWN REFLECT SOME
RECLASSIFICATION RELATED TO
BOOK TO TAX DIFFERENCES.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ENERGY SERVICE
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 28.02 $ 20.46 $ 16.09 $ 11.97 $ 11.66
period
Income from Investment
Operations
Net investment income (loss) (.10) (.10) (.01) .08 D .02
C
Net realized and unrealized (13.26) 9.36 5.05 4.49 .67
gain (loss)
Total from investment (13.36) 9.26 5.04 4.57 .69
operations
Less Distributions
From net investment income - - - (.04) (.01)
In excess of net investment - - - - (.01)
income
From net realized gain (1.71) (1.85) (.79) (.48) (.35)
In excess of net realized - - - - (.13)
gain
Total distributions (1.71) (1.85) (.79) (.52) (.50)
Redemption fees added to paid .14 .15 .12 .07 .12
in capital
Net asset value, end of period $ 13.09 $ 28.02 $ 20.46 $ 16.09 $ 11.97
TOTAL RETURN A, B (50.57)% 48.43% 32.26% 39.15% 7.60%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 366,896 $ 919,002 $ 439,504 $ 273,805 $ 63,794
(000 omitted)
Ratio of expenses to average 1.39% 1.25% 1.47% 1.59% 1.81%
net assets
Ratio of expenses to average 1.35% E 1.22% E 1.45% E 1.58% E 1.79% E
net assets after expense
reductions
Ratio of net investment (.49)% (.35)% (.07)% .60% .19%
income (loss) to average net
assets
Portfolio turnover rate 75% 78% 167% 223% 209%
</TABLE>
A THE TOTALS RETURN WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D INVESTMENT INCOME PER SHARE
REFLECTS A SPECIAL DIVIDEND
WHICH AMOUNTED TO $.02 PER
SHARE.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ENVIRONMENTAL SERVICES
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 16.46 $ 14.50 $ 12.42 $ 10.27 $ 11.93
period
Income from Investment
Operations
Net investment income (loss) (.18) (.13) (.08) (.17) (.14)
c
Net realized and unrealized (3.50) 2.07 2.04 2.95 (1.53)
gain (loss)
Total from investment (3.68) 1.94 1.96 2.78 (1.67)
operations
Less Distributions
From net realized gain - - - (.65) -
In excess of net realized (.03) - (.02) - -
gain
Total distributions (.03) - (.02) (.65) -
Redemption fees added to paid .02 .02 .14 .02 .01
in capital
Net asset value, end of period $ 12.77 $ 16.46 $ 14.50 $ 12.42 $ 10.27
TOTAL RETURN A, b (22.23)% 13.52% 16.93% 27.49% (13.91)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 15,534 $ 25,183 $ 32,525 $ 27,587 $ 31,270
(000 omitted)
Ratio of expenses to average 2.20% 2.23% 2.18% 2.36% 2.04%
net assets
Ratio of expenses to average 2.16% d 2.22% d 2.11% d 2.32% d 2.01% d
net assets after expense
reductions
Ratio of net investment (1.23)% (.84)% (.59)% (1.43)% (1.32)%
income (loss) to average net
assets
Portfolio turnover rate 123% 59% 252% 138% 82%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL SERVICES
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 103.28 $ 82.94 $ 65.70 $ 48.23 $ 51.24
period
Income from Investment
Operations
Net investment income C .56 .70 .74 1.03 .76
Net realized and unrealized 7.88 30.65 21.55 17.56 .87
gain (loss)
Total from investment 8.44 31.35 22.29 18.59 1.63
operations
Less Distributions
From net investment income (.19) (.64) (.63) (.37) (.79)
From net realized gain (10.81) (10.51) (4.56) (.91) (3.93)
Total distributions (11.00) (11.15) (5.19) (1.28) (4.72)
Redemption fees added to paid .10 .14 .14 .16 .08
in capital
Net asset value, end of period $ 100.82 $ 103.28 $ 82.94 $ 65.70 $ 48.23
TOTAL RETURN A, B 8.42% 41.08% 35.54% 39.05% 4.72%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 547,000 $ 604,908 $ 426,424 $ 270,466 $ 153,089
(000 omitted)
Ratio of expenses to average 1.20% 1.31% 1.45% 1.42% 1.56%
net assets
Ratio of expenses to average 1.18% D 1.29% D 1.43% D 1.41% D 1.54% D
net assets after expense
reductions
Ratio of net investment .58% .78% 1.03% 1.78% 1.52%
income to average net assets
Portfolio turnover rate 60% 84% 80% 125% 107%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FOOD AND AGRICULTURE
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 48.81 $ 44.53 $ 42.15 $ 32.53 $ 31.49
period
Income from Investment
Operations
Net investment income C .21 .33 .42 .37 .15
Net realized and unrealized 3.50 9.22 4.91 11.61 2.80
gain (loss)
Total from investment 3.71 9.55 5.33 11.98 2.95
operations
Less Distributions
From net investment income (.16) (.37) (.24) (.20) (.08)
From net realized gain (5.47) (4.95) (2.77) (2.20) (1.85)
Total distributions (5.63) (5.32) (3.01) (2.40) (1.93)
Redemption fees added to paid .03 .05 .06 .04 .02
in capital
Net asset value, end of period $ 46.92 $ 48.81 $ 44.53 $ 42.15 $ 32.53
TOTAL RETURN A, B 7.83% 23.58% 13.59% 37.92% 10.14%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 206,007 $ 250,567 $ 223,423 $ 301,102 $ 197,130
(000 omitted)
Ratio of expenses to average 1.31% 1.49% 1.52% 1.43% 1.70%
net assets
Ratio of expenses to average 1.29% D 1.48% D 1.50% D 1.42% D 1.68% D
net assets after expense
reductions
Ratio of net investment .45% .73% 1.01% .99% .49%
income to average net assets
Portfolio turnover rate 68% 74% 91% 124% 126%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
GOLD
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 15.17 $ 28.21 $ 27.11 $ 18.44 $ 22.66
period
Income from Investment
Operations
Net investment income (loss) (.08) (.13) (.16) (.06) (.05)
C
Net realized and unrealized (2.43) (11.78) 1.60 8.62 (4.25)
gain (loss)
Total from investment (2.51) (11.91) 1.44 8.56 (4.30)
operations
Less Distributions
From net realized gain - (1.29) (.50) - -
Redemption fees added to paid .13 .16 .16 .11 .08
in capital
Net asset value, end of period $ 12.79 $ 15.17 $ 28.21 $ 27.11 $ 18.44
TOTAL RETURN A, B (15.69)% (43.15)% 6.10% 47.02% (18.62)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 179,619 $ 219,668 $ 428,103 $ 451,493 $ 278,197
(000 omitted)
Ratio of expenses to average 1.57% 1.55% 1.44% 1.39% 1.41%
net assets
Ratio of expenses to average 1.54% D 1.48% D 1.42% D 1.39% 1.41%
net assets after expense
reductions
Ratio of net investment (.59)% (.67)% (.59)% (.27)% (.22)%
income (loss) to average net
assets
Portfolio turnover rate 59% 89% 63% 56% 34%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
HEALTH CARE
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 113.84 $ 102.45 $ 100.47 $ 76.13 $ 63.31
period
Income from Investment
Operations
Net investment income C .17 .33 .52 .95 .75
Net realized and unrealized 29.85 31.94 18.01 28.85 18.38
gain (loss)
Total from investment 30.02 32.27 18.53 29.80 19.13
operations
Less Distributions
From net investment income (.19) (.25) (.65) (.59) (.62)
From net realized gain (6.17) (20.73) (15.95) (4.92) (5.74)
Total distributions (6.36) (20.98) (16.60) (5.51) (6.36)
Redemption fees added to paid .10 .10 .05 .05 .05
in capital
Net asset value, end of period $ 137.60 $ 113.84 $ 102.45 $ 100.47 $ 76.13
TOTAL RETURN A, B 27.20% 36.47% 20.41% 39.68% 31.24%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 3,145,825 $ 2,224,019 $ 1,372,554 $ 1,525,910 $ 943,141
(000 omitted)
Ratio of expenses to average 1.07% 1.20% 1.33% 1.31% 1.39%
net assets
Ratio of expenses to average 1.05% D 1.18% D 1.32% D 1.30% D 1.36% D
net assets after expense
reductions
Ratio of net investment .14% .31% .52% 1.06% 1.08%
income to average net assets
Portfolio turnover rate 66% 79% 59% 54% 151%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
HOME FINANCE
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 53.36 $ 46.00 $ 33.30 $ 23.92 $ 25.03
period
Income from Investment
Operations
Net investment income c .28 .33 .53 .53 .20
Net realized and unrealized (10.16) 13.10 14.60 9.72 2.34
gain (loss)
Total from investment (9.88) 13.43 15.13 10.25 2.54
operations
Less Distributions
From net investment income (.07) (.29) (.32) (.19) (.12)
From net realized gain (1.38) (5.84) (2.16) (.73) (3.60)
Total distributions (1.45) (6.13) (2.48) (.92) (3.72)
Redemption fees added to paid .06 .06 .05 .05 .07
in capital
Net asset value, end of period $ 42.09 $ 53.36 $ 46.00 $ 33.30 $ 23.92
TOTAL RETURN a,b (19.12)% 32.39% 47.50% 43.24% 12.43%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 740,440 $ 1,668,610 $ 1,176,828 $ 617,035 $ 229,924
(000 omitted)
Ratio of expenses to average 1.19% 1.21% 1.38% 1.35% 1.47%
net assets
Ratio of expenses to average 1.18% d 1.19% d 1.34% d 1.32% d 1.45% d
net assets after expense
reductions
Ratio of net investment .57% .67% 1.41% 1.80% .80%
income to average net assets
Portfolio turnover rate 18% 54% 78% 81% 124%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
INDUSTRIAL EQUIPMENT
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 25.91 $ 25.51 $ 25.11 $ 20.04 $ 20.61
period
Income from Investment
Operations
Net investment income (loss) (.04) (.08) .06 .04 .01
C
Net realized and unrealized .25 5.73 4.15 7.10 (.44)
gain (loss)
Total from investment .21 5.65 4.21 7.14 (.43)
operations
Less Distributions
From net investment income - (.02) (.04) (.05) (.01)
From net realized gain (.92) (5.26) (3.84) (2.05) (.16)
Total distributions (.92) (5.28) (3.88) (2.10) (.17)
Redemption fees added to paid .03 .03 .07 .03 .03
in capital
Net asset value, end of period $ 25.23 $ 25.91 $ 25.51 $ 25.11 $ 20.04
TOTAL RETURN A, B 1.00% 25.76% 18.25% 36.86% (1.93)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 31,573 $ 50,428 $ 102,882 $ 137,520 $ 109,968
(000 omitted)
Ratio of expenses to average 1.43% 1.67% 1.51% 1.54% 1.80%
net assets
Ratio of expenses to average 1.41% D 1.60% D 1.44% D 1.53% D 1.78% D
net assets after expense
reductions
Ratio of net investment (.16)% (.32)% .25% .19% .06%
income (loss) to average net
assets
Portfolio turnover rate 84% 115% 261% 115% 131%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
INDUSTRIAL MATERIALS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 25.00 $ 27.66 $ 26.07 $ 23.13 $ 21.67
period
Income from Investment
Operations
Net investment income (loss) (.12) (.11) .06 .12 .17
C
Net realized and unrealized (4.60) 1.43 3.12 2.92 1.43
gain (loss)
Total from investment (4.72) 1.32 3.18 3.04 1.60
operations
Less Distributions
From net investment income - (.03) (.06) (.15) (.18)
From net realized gain - (4.00) (1.57) - -
Total distributions - (4.03) (1.63) (.15) (.18)
Redemption fees added to paid .04 .05 .04 .05 .04
in capital
Net asset value, end of period $ 20.32 $ 25.00 $ 27.66 $ 26.07 $ 23.13
TOTAL RETURN A, B (18.72)% 6.59% 12.69% 13.38% 7.65%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 11,162 $ 22,582 $ 66,462 $ 86,338 $ 183,454
(000 omitted)
Ratio of expenses to average 2.07% 1.98% 1.54% 1.64% 1.56%
net assets
Ratio of expenses to average 2.04% D 1.94% D 1.51% D 1.61% D 1.53% D
net assets after expense
reductions
Ratio of net investment (.52)% (.42)% .23% .49% .77%
income (loss) to average net
assets
Portfolio turnover rate 82% 118% 105% 138% 139%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE .
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
INSURANCE
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 42.10 $ 32.62 $ 26.77 $ 21.31 $ 19.41
period
Income from Investment
Operations
Net investment income (loss) (.04) .01 .01 .06 .05
C
Net realized and unrealized 4.01 12.93 7.21 6.15 1.78
gain (loss)
Total from investment 3.97 12.94 7.22 6.21 1.83
operations
Less Distributions
From net investment income - - (.03) (.07) -
From net realized gain (3.98) (3.54) (1.45) (.72) -
Total distributions (3.98) (3.54) (1.48) (.79) -
Redemption fees added to paid .05 .08 .11 .04 .07
in capital
Net asset value, end of period $ 42.14 $ 42.10 $ 32.62 $ 26.77 $ 21.31
TOTAL RETURN A, B 9.84% 42.81% 28.28% 29.51% 9.79%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 82,879 $ 125,151 $ 42,367 $ 38,994 $ 21,838
(000 omitted)
Ratio of expenses to average 1.33% 1.45% 1.82% 1.77% 2.36%
net assets
Ratio of expenses to average 1.31% D 1.43% D 1.77% D 1.74% D 2.34% D
net assets after expense
reductions
Ratio of net investment (.10)% .02% .05% .26% .25%
income (loss) to average net
assets
Portfolio turnover rate 72% 157% 142% 164% 265%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
LEISURE
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 62.30 $ 47.83 $ 46.17 $ 40.71 $ 45.30
period
Income from Investment
Operations
Net investment income (loss) (.27) (.25) (.06) E (.21) (.21)
C
Net realized and unrealized 22.78 21.10 4.47 10.97 (.48)
gain (loss)
Total from investment 22.51 20.85 4.41 10.76 (.69)
operations
Less Distributions
From net realized gain (3.44) (6.46) (2.83) (5.32) (3.93)
Redemption fees added to paid .07 .08 .08 .02 .03
in capital
Net asset value, end of period $ 81.44 $ 62.30 $ 47.83 $ 46.17 $ 40.71
TOTAL RETURN A, B 37.54% 47.29% 10.14% 27.61% (1.07)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 346,139 $ 257,199 $ 98,133 $ 85,013 $ 69,569
(000 omitted)
Ratio of expenses to average 1.26% 1.44% 1.56% 1.64% 1.64%
net assets
Ratio of expenses to average 1.24% D 1.39% D 1.54% D 1.63% D 1.62% D
net assets after expense
reductions
Ratio of net investment (.40)% (.46)% (.12)% (.46)% (.52)%
income (loss) to average net
assets
Portfolio turnover rate 107% 209% 127% 141% 103%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E INVESTMENT INCOME (LOSS)
PER SHARE REFLECTS A SPECIAL
DIVIDEND WHICH AMOUNTED TO
$.23 PER SHARE.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MEDICAL DELIVERY
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 28.32 $ 28.29 $ 29.00 $ 23.18 $ 20.28
period
Income from Investment
Operations
Net investment income (loss) (.06) F (.24) (.23) (.03) .06
C
Net realized and unrealized (7.88) 5.45 2.92 7.72 3.74
gain (loss)
Total from investment (7.94) 5.21 2.69 7.69 3.80
operations
Less Distributions
From net investment income - - - - (.06)
From net realized gain (1.21) (5.23) (3.45) (1.91) (.89)
In excess of net realized (.13) - - - --
gain
Total distributions (1.34) (5.23) (3.45) (1.91) (.95)
Redemption fees added to paid .04 .05 .05 .04 .05
in capital
Net asset value, end of period $ 19.08 $ 28.32 $ 28.29 $ 29.00 $ 23.18
TOTAL RETURN A, B (29.47)% 21.97% 10.50% 34.15% 19.63%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 76,842 $ 155,542 $ 192,385 $ 295,489 $ 299,570
(000 omitted)
Ratio of expenses to average 1.40% 1.57% 1.57% 1.65% 1.48%
net assets
Ratio of expenses to average 1.37% d 1.53% d 1.53% d 1.62% d 1.45% d
net assets after expense
reductions
Ratio of net investment (.25)% (.88)% (.84)% (.13)% .29%
income (loss) to average net
assets
Portfolio turnover rate 67% 109% 78% 132% 123%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
F NET INVESTMENT INCOME
(LOSS) PER SHARE REFLECTS A
SPECIAL DIVIDEND FROM
VENCOR, INC., WHICH AMOUNTED
TO $.12 PER SHARE.
</TABLE>
MEDICAL EQUIPMENT AND SYSTEMS
Year ended February 28, 1999 F
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 10.00
period
Income from Investment
Operations
Net investment income (loss) (.11)
D
Net realized and unrealized 2.18
gain (loss)
Total from investment 2.07
operations
Redemption fees added to paid .03
in capital
Net asset value, end of period $ 12.10
TOTAL RETURN B, C 21.00%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 28,594
(000 omitted)
Ratio of expenses to average 2.39% A
net assets
Ratio of expenses to average 2.38% A, E
net assets after expense
reductions
Ratio of net investment (1.21)% A
income (loss) to average net
assets
Portfolio turnover rate 85% A
A ANNUALIZED
B THE TOTAL RETURN WOULD HAVE
BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIOD SHOWN.
C TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
D NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE PERIOD APRIL 28,
1998 (COMMENCEMENT OF
OPERATIONS) TO FEBRUARY 28,
1999.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MULTIMEDIA
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 33.58 $ 24.91 $ 27.18 $ 22.35 $ 23.87
period
Income from Investment
Operations
Net investment income (loss) (.19) (.17) .35 D .02 (.01)
C
Net realized and unrealized 11.85 10.30 (1.58) 7.00 1.67
gain (loss)
Total from investment 11.66 10.13 (1.23) 7.02 1.66
operations
Less Distributions
From net investment income - - - (.02) -
From net realized gain (2.19) (1.52) (1.07) (2.19) (3.21)
Total distributions (2.19) (1.52) (1.07) (2.21) (3.21)
Redemption fees added to paid .08 .06 .03 .02 .03
in capital
Net asset value, end of period $ 43.13 $ 33.58 $ 24.91 $ 27.18 $ 22.35
TOTAL RETURN A, B 36.68% 42.42% (4.52)% 31.98% 9.35%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 159,730 $ 115,485 $ 54,171 $ 94,970 $ 38,157
(000 omitted)
Ratio of expenses to average 1.35% 1.75% 1.60% 1.56% 2.05%
net assets
Ratio of expenses to average 1.33% E 1.71% E 1.56% E 1.54% E 2.03% E
net assets after expense
reductions
Ratio of net investment (.52)% (.59)% 1.33% .08% (.07)%
income (loss) to average net
assets
Portfolio turnover rate 109% 219% 99% 223% 107%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE .
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D INVESTMENT INCOME PER SHARE
REFLECTS A SPECIAL DIVIDEND
WHICH AMOUNTED TO $.49 PER
SHARE.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NATURAL GAS
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 13.22 $ 12.50 $ 11.36 $ 8.98 $ 9.48
period
Income from Investment
Operations
Net investment income (loss) .12 E (.05) (.06) .05 .03
C
Net realized and unrealized (2.68) 1.06 1.30 2.36 (.53)
gain (loss)
Total from investment (2.56) 1.01 1.24 2.41 (.50)
operations
Less Distributions
From net investment income (.10) - (.01) (.05) (.02)
From net realized gain - (.30) (.29) - -
In excess of net realized - (.03) - - -
gain
Total distributions (.10) (.33) (.30) (.05) (.02)
Redemption fees added to paid .03 .04 .20 .02 .02
in capital
Net asset value, end of period $ 10.59 $ 13.22 $ 12.50 $ 11.36 $ 8.98
TOTAL RETURN A, B (19.17)% 8.74% 12.45% 27.10% (5.06)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 36,828 $ 59,866 $ 81,566 $ 60,228 $ 79,894
(000 omitted)
Ratio of expenses to average 1.57% 1.82% 1.70% 1.68% 1.70%
net assets
Ratio of expenses to average 1.52% D 1.78% D 1.66% D 1.67% D 1.66% D
net assets after expense
reductions
Ratio of net investment .93% (.37)% (.46)% .46% .30%
income (loss) to average net
assets
Portfolio turnover rate 107% 118% 283% 79% 177%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E NET INVESTMENT INCOME PER
SHARE REFLECTS A SPECIAL
DIVIDEND FROM TRANSCANADA
PIPELINES LTD. WHICH
AMOUNTED TO $.10 PER SHARE.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
NATURAL RESOURCES
Years ended February 28, 1999 1998 E
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 10.46 $ 10.00
period
Income from Investment
Operations
Net investment income (loss) (.05) (.09)
d
Net realized and unrealized (2.54) .76
gain (loss)
Total from investment (2.59) .67
operations
Less Distributions
From net realized gain - (.26)
Redemption fees added to paid .02 .05
in capital
Net asset value, end of period $ 7.89 $ 10.46
TOTAL RETURN B, C (24.57)% 7.30%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 5,134 $ 7,520
(000 omitted)
Ratio of expenses to average 2.50% F 2.50% A, F
net assets
Ratio of expenses to average 2.47% G 2.48% A, G
net assets after expense
reductions
Ratio of net investment (.54)% (.86)% A
income (loss) to average net
assets
Portfolio turnover rate 155% 165% A
A ANNUALIZED
B THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
C TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
D NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
E FOR THE PERIOD MARCH 3,
1997 (COMMENCEMENT OF
OPERATIONS) TO FEBRUARY 28,
1998.
F FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
G FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
PAPER AND FOREST PRODUCTS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 22.66 $ 21.63 $ 20.78 $ 21.14 $ 19.61
period
Income from Investment
Operations
Net investment income (loss) (.03) (.12) .01 .08 .01
C
Net realized and unrealized (3.87) 3.13 2.08 1.83 2.53
gain (loss)
Total from investment (3.90) 3.01 2.09 1.91 2.54
operations
Less Distributions
From net investment income - - (.03) (.08) -
In excess of net investment - (.04) (.07) - -
income
From net realized gain -- (2.07) (1.25) (2.27) (1.17)
In excess of net realized (.44) -- -- -- --
gain
Total distributions (.44) (2.11) (1.35) (2.35) (1.17)
Redemption fees added to paid .13 .13 .11 .08 .16
in capital
Net asset value, end of period $ 18.45 $ 22.66 $ 21.63 $ 20.78 $ 21.14
TOTAL RETURN A, B (17.01)% 15.53% 10.87% 9.18% 14.91%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 10,247 $ 31,384 $ 19,484 $ 27,270 $ 94,219
(000 omitted)
Ratio of expenses to average 2.30% 2.18% 2.19% 1.91% 1.88%
net assets
Ratio of expenses to average 2.21% D 2.15% D 2.16% D 1.90% D 1.87% D
net assets after expense
reductions
Ratio of net investment (.13)% (.50)% .04% .34% .05%
income (loss) to average net
assets
Portfolio turnover rate 338% 235% 180% 78% 209%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
PRECIOUS METALS AND MINERALS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 10.28 $ 19.60 $ 20.96 $ 15.27 $ 16.62
period
Income from Investment
Operations
Net investment income (loss) (.01) (.04) (.01) .07 .17
C
Net realized and unrealized (1.27) (9.42) (1.42) 5.54 (1.42)
gain (loss)
Total from investment (1.28) (9.46) (1.43) 5.61 (1.25)
operations
Less Distributions
From net investment income - - (.04) (.06) (.18)
In excess of net investment - - (.01) - (.05)
income
Total distributions - - (.05) (.06) (.23)
Redemption fees added to paid .16 .14 .12 .14 .13
in capital
Net asset value, end of period $ 9.16 $ 10.28 $ 19.60 $ 20.96 $ 15.27
TOTAL RETURN A, B (10.89)% (47.55)% (6.26)% 37.74% (6.86)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 123,439 $ 165,960 $ 325,586 $ 467,196 $ 364,204
(000 omitted)
Ratio of expenses to average 1.78% 1.82% 1.62% 1.52% 1.46%
net assets
Ratio of expenses to average 1.74% D 1.76% D 1.61% D 1.52% 1.46%
net assets after expense
reductions
Ratio of net investment (.09)% (.26)% (.05)% .39% .99%
income (loss) to average net
assets
Portfolio turnover rate 53% 84% 54% 53% 43%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
REGIONAL BANKS
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 43.18 $ 32.82 $ 24.37 $ 18.01 $ 17.99
period
Income from Investment
Operations
Net investment income C .39 .40 .37 .52 .37
Net realized and unrealized .91 11.41 9.70 6.78 .87
gain (loss)
Total from investment 1.30 11.81 10.07 7.30 1.24
operations
Less Distributions
From net investment income (.28) (.28) (.27) (.25) (.29)
From net realized gain (2.66) (1.23) (1.40) (.72) (.98)
Total distributions (2.94) (1.51) (1.67) (.97) (1.27)
Redemption fees added to paid .03 .06 .05 .03 .05
in capital
Net asset value, end of period $ 41.57 $ 43.18 $ 32.82 $ 24.37 $ 18.01
TOTAL RETURN A, B 3.10% 36.64% 43.33% 40.94% 7.79%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 925,829 $ 1,338,896 $ 837,952 $ 315,178 $ 164,603
(000 omitted)
Ratio of expenses to average 1.17% 1.25% 1.46% 1.41% 1.58%
net assets
Ratio of expenses to average 1.16% D 1.24% D 1.45% D 1.40% D 1.56% D
net assets after expense
reductions
Ratio of net investment .91% 1.07% 1.36% 2.42% 1.99%
income to average net assets
Portfolio turnover rate 22% 25% 43% 103% 106%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
RETAILING
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 50.04 $ 33.25 $ 27.87 $ 23.91 $ 24.91
period
Income from Investment
Operations
Net investment income (loss) (.28) (.27) (.13) (.14) (.18)
C
Net realized and unrealized 18.27 17.14 5.49 4.07 (.96)
gain (loss)
Total from investment 17.99 16.87 5.36 3.93 (1.14)
operations
Less Distributions
From net realized gain (.39) (.51) (.08) - -
In excess of net realized (.30) -- -- - -
gain
Total distributions (.69) (.51) (.08) - -
Redemption fees added to paid .16 .43 .10 .03 .14
in capital
Net asset value, end of period $ 67.50 $ 50.04 $ 33.25 $ 27.87 $ 23.91
TOTAL RETURN A, B 36.66% 52.61% 19.59% 16.56% (4.01)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 337,513 $ 192,861 $ 59,348 $ 44,051 $ 31,090
(000 omitted)
Ratio of expenses to average 1.25% 1.63% 1.45% 1.94% 2.07%
net assets
Ratio of expenses to average 1.22% D 1.55% D 1.39% D 1.92% D 1.96% D
net assets after expense
reductions
Ratio of net investment (.50)% (.67)% (.39)% (.53)% (.74)%
income (loss) to average net
assets
Portfolio turnover rate 165% 308% 278% 235% 481%
</TABLE>
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
SOFTWARE AND COMPUTER SERVICES
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 44.26 $ 38.58 $ 36.20 $ 29.07 $ 28.89
period
Income from Investment
Operations
Net investment income (loss) (.39) (.33) (.25) (.19) (.26)
C
Net realized and unrealized 14.46 12.57 5.87 11.85 .67
gain (loss)
Total from investment 14.07 12.24 5.62 11.66 .41
operations
Less Distributions
From net realized gain (1.32) (6.61) (3.31) (4.60) (.33)
Redemption fees added to paid .08 .05 .07 .07 .10
in capital
Net asset value, end of period $ 57.09 $ 44.26 $ 38.58 $ 36.20 $ 29.07
TOTAL RETURN A, B 32.57% 35.50% 16.14% 40.17% 1.97%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 690,852 $ 503,367 $ 389,699 $ 337,633 $ 236,445
(000 omitted)
Ratio of expenses to average 1.28% 1.44% 1.54% 1.48% 1.52%
net assets
Ratio of expenses to average 1.27% D 1.42% D 1.51% D 1.47% D 1.50% D
net assets after expense
reductions
Ratio of net investment (.82)% (.81)% (.66)% (.54)% (1.01)%
income (loss) to average net
assets
Portfolio turnover rate 72% 145% 279% 183% 164%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
TECHNOLOGY
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 53.13 $ 57.70 $ 54.67 $ 42.05 $ 41.83
period
Income from Investment
Operations
Net investment income (loss) (.34) (.25) (.39) (.28) (.39)
C
Net realized and unrealized 29.79 11.29 6.95 20.83 1.95
gain (loss)
Total from investment 29.45 11.04 6.56 20.55 1.56
operations
Less Distributions
From net realized gain - (12.39) (3.68) (8.05) (1.50)
In excess of net realized - (3.30) - - -
gain
Total distributions - (15.69) (3.68) (8.05) (1.50)
Redemption fees added to paid .12 .08 .15 .12 .16
in capital
Net asset value, end of period $ 82.70 $ 53.13 $ 57.70 $ 54.67 $ 42.05
TOTAL RETURN A, B 55.66% 24.92% 12.64% 50.71% 4.61%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 1,367,148 $ 691,924 $ 478,444 $ 483,026 $ 229,761
(000 omitted)
Ratio of expenses to average 1.24% 1.38% 1.49% 1.40% 1.57%
net assets
Ratio of expenses to average 1.20% D 1.30% D 1.44% D 1.39% D 1.56% D
net assets after expense
reductions
Ratio of net investment (.54)% (.45)% (.72)% (.52)% (.98)%
income (loss) to average net
assets
Portfolio turnover rate 339% 556% 549% 112% 102%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE .
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
TELECOMMUNICATIONS
Years ended February 28, 1999 1998 1997 1996 F 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 53.37 $ 41.80 $ 44.87 $ 38.34 $ 37.10
period
Income from Investment
Operations
Net investment income (loss) (.06) (.25) .12 D .51 .29
C
Net realized and unrealized 11.43 18.20 2.92 9.15 2.54
gain (loss)
Total from investment 11.37 17.95 3.04 9.66 2.83
operations
Less Distributions
From net investment income - - (.16) (.39) (.33)
From net realized gain (2.96) (6.44) (5.98) (2.75) (1.27)
Total distributions (2.96) (6.44) (6.14) (3.14) (1.60)
Redemption fees added to paid .07 .06 .03 .01 .01
in capital
Net asset value, end of period $ 61.85 $ 53.37 $ 41.80 $ 44.87 $ 38.34
TOTAL RETURN A, B 22.21% 46.52% 7.85% 25.79% 7.98%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 824,175 $ 643,449 $ 388,535 $ 468,300 $ 369,476
(000 omitted)
Ratio of expenses to average 1.27% 1.51% 1.51% 1.52% 1.56%
net assets
Ratio of expenses to average 1.25% E 1.48% E 1.47% E 1.52% 1.55% E
net assets after expense
reductions
Ratio of net investment (.11)% (.53)% .27% 1.17% .77%
income (loss) to average net
assets
Portfolio turnover rate 150% 157% 175% 89% 107%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D INVESTMENT INCOME PER SHARE
REFLECTS A SPECIAL DIVIDEND
WHICH AMOUNTED TO $.07 PER
SHARE.
E FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
F FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
TRANSPORTATION
Years ended February 28, 1999 1998 1997 1996 G 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 28.34 $ 22.23 $ 21.92 $ 20.53 $ 21.67
period
Income from Investment
Operations
Net investment income (loss) (.18) (.02) (.13) (.09) D (.17)
C
Net realized and unrealized (.58) 8.85 1.06 2.60 1.17
gain (loss)
Total from investment (.76) 8.83 .93 2.51 1.00
operations
Less Distributions
From net realized gain (2.64) (2.80) (.71) (1.22) (2.19)
Redemption fees added to paid .10 .08 .09 .10 .05
in capital
Net asset value, end of period $ 25.04 $ 28.34 $ 22.23 $ 21.92 $ 20.53
TOTAL RETURN A, B (1.73)% 41.15% 4.67% 12.95% 5.90%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 19,855 $ 64,282 $ 8,890 $ 11,445 $ 12,704
(000 omitted)
Ratio of expenses to average 1.96% 1.58% 2.50% E 2.47% E 2.37%
net assets
Ratio of expenses to average 1.90% F 1.54% F 2.48% F 2.44% F 2.36% F
net assets after expense
reductions
Ratio of net investment (.68)% (.06)% (.58)% (.43)% (.83)%
income (loss) to average net
assets
Portfolio turnover rate 182% 210% 148% 175% 178%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
C NET INVESTMENT INCOME
(LOSS) PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING
THE PERIOD.
D INVESTMENT INCOME PER SHARE
REFLECTS A SPECIAL DIVIDEND
WHICH AMOUNTED TO $.05 PER
SHARE.
E FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S
EXPENSES, OR EXPENSES WERE
LIMITED IN ACCORDANCE WITH A
STATE EXPENSE LIMITATION.
WITHOUT THIS REIMBURSEMENT,
THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
F FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
G FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
UTILITIES GROWTH
Years ended February 28, 1999 1998 1997 1996 E 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 53.50 $ 45.97 $ 43.03 $ 34.88 $ 36.61
period
Income from Investment
Operations
Net investment income C .44 .54 .73 1.10 1.13
Net realized and unrealized 15.77 14.83 6.41 7.86 (1.17)
gain (loss)
Total from investment 16.21 15.37 7.14 8.96 (.04)
operations
Less Distributions
From net investment income (.25) (.58) (.70) (.84) (1.05)
From net realized gain (7.93) (7.30) (3.54) - (.67)
Total distributions (8.18) (7.88) (4.24) (.84) (1.72)
Redemption fees added to paid .05 .04 .04 .03 .03
in capital
Net asset value, end of period $ 61.58 $ 53.50 $ 45.97 $ 43.03 $ 34.88
TOTAL RETURN A, B 32.17% 36.20% 18.13% 25.82% .21%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 507,841 $ 401,927 $ 256,844 $ 266,768 $ 237,635
(000 omitted)
Ratio of expenses to average 1.18% 1.33% 1.47% 1.39% 1.43%
net assets
Ratio of expenses to average 1.16% D 1.30% D 1.46% D 1.38% D 1.42% D
net assets after expense
reductions
Ratio of net investment .77% 1.11% 1.73% 2.76% 3.24%
income to average net assets
Portfolio turnover rate 113% 78% 31% 65% 24%
A THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE .
C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD.
D FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
E FOR THE YEAR ENDED FEBRUARY
29.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MONEY MARKET
Years ended February 28, 1999 1998 1997 1996C 1995
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment .050 .051 .049 .054 .042
Operations Net interest
income
Less Distributions
From net interest income (.050) (.051) (.049) (.054) (.042)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN A 5.08% 5.26% 5.02% 5.56% 4.28%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 1,126,174 $ 584,919 $ 848,168 $ 610,821 $ 573,144
(000 omitted)
Ratio of expenses to average .50% .56% .56% .59% .65%
net assets
Ratio of expenses to average .49% B .56% .56% .59% .65%
net assets after expense
reductions
Ratio of net interest income 5.03% 5.13% 4.92% 5.39% 4.19%
to average net assets
</TABLE>
A TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES
CHARGE.
B FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A
PORTION OF THE FUND'S
EXPENSES.
C FOR THE YEAR ENDED FEBRUARY
29.
You can obtain additional information about the funds. The funds' SAI
includes more detailed information about each fund and its
investments. The SAI is incorporated herein by reference (legally
forms a part of the prospectus). Each 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 a fund, call Fidelity at
1-800-544-8544 or visit Fidelity's Web site at www.fidelity.com.
The SAI, the funds' 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 funds, including the funds' SAI, 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 811-3114
Select Portfolios, Fidelity Investments & (Pyramid) Design, Fidelity,
Fidelity Investments, TouchTone Xpress, Fidelity Money Line, Fidelity
Automatic Account Builder, Fidelity On-Line Xpress+, and Directed
Dividends are registered trademarks of FMR Corp.
Portfolio Advisory Services is a service mark of FMR Corp.
The third party marks appearing above are the marks of their
respective owners.
1.701898.101 SEL-pro-0499
FIDELITY SELECT PORTFOLIOS(registered trademark)
STATEMENT OF ADDITIONAL INFORMATION
APRIL 29, 1999
This Statement of Additional Information (SAI) is not a prospectus.
Portions of the funds' Annual Report are incorporated herein. The
Annual Report is supplied with this SAI.
To obtain a free additional copy of the Prospectus, dated April 29,
1999, or an Annual Report, 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 94
Limitations
Portfolio Transactions 103
Valuation 115
Performance 116
Additional Purchase, Exchange 214
and Redemption Information
Distributions and Taxes 214
Trustees and Officers 215
Control of Investment Advisers 225
Management Contracts 225
Distribution Services 240
Transfer and Service Agent 250
Agreements
Description of the Trust 253
Financial Statements 254
Appendix 254
SEL-ptb-0499
1.474722.101
(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 a fund'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 the fund'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 the fund's investment policies and limitations.
A fund'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.
INVESTMENT LIMITATIONS OF EACH STOCK FUND (EXCEPT BUSINESS SERVICES
AND OUTSOURCING PORTFOLIO, CYCLICAL INDUSTRIES PORTFOLIO, MEDICAL
EQUIPMENT AND SYSTEMS PORTFOLIO, AND NATURAL RESOURCES PORTFOLIO)
THE FOLLOWING ARE THE FUNDS' FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. A FUND MAY NOT:
(1) 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;
(2) borrow money, except that a 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;
(3) underwrite securities issued by others, except to the extent that
a fund may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;
(4) purchase or sell the securities of any issuer, if, as a result of
such purchase or sale, less than 25% of the assets of the fund would
be invested in the securities of issuers principally engaged in the
business activities having the specific characteristics denoted by the
fund;
(5) purchase or sell real estate unless acquired as a result of
ownership of securities or other instruments (but this shall not
prevent a fund from investing in securities or other instruments
backed by real estate or securities of companies engaged in the real
estate business);
(6) purchase or sell physical commodities unless acquired as a result
of ownership of securities or other instruments (but this shall not
prevent a fund from purchasing or selling options and futures
contracts or from investing in securities or other instruments backed
by physical commodities). This limitation does not apply to Precious
Metals and Minerals Portfolio or to Gold Portfolio (see below); or
(7) 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.
(8) 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 with substantially the
same fundamental investment objectives, policies, and limitations as
the fund.
ADDITIONAL FUNDAMENTAL INVESTMENT LIMITATIONS OF CERTAIN OF THE STOCK
FUNDS.
GOLD PORTFOLIO AND PRECIOUS METALS AND MINERALS PORTFOLIO MAY NOT:
(1) purchase any precious metal if, as a result, more than 50% of its
total assets would be invested in precious metals; or
(2) purchase or sell physical commodities, provided that the fund may
purchase and sell precious metals, and further provided that the fund
may sell physical commodities acquired as a result of ownership of
securities. The fund may not purchase or sell options, options on
futures contracts, or futures contracts on physical commodities other
than precious metals.
FINANCIAL SERVICES PORTFOLIO, REGIONAL BANKS PORTFOLIO, AND HOME
FINANCE PORTFOLIO 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.
THE FOLLOWING ARE NON-FUNDAMENTAL LIMITATIONS FOR EACH STOCK FUND
(EXCEPT BUSINESS SERVICES AND OUTSOURCING PORTFOLIO, CYCLICAL
INDUSTRIES PORTFOLIO, MEDICAL EQUIPMENT AND SYSTEMS PORTFOLIO, AND
NATURAL RESOURCES PORTFOLIO), WHICH MAY BE CHANGED WITHOUT SHAREHOLDER
APPROVAL.
(i) For each fund (except Home Finance, Financial Services, and
Regional Banks), in order to qualify as a "regulated investment
company" under Subchapter M of the Internal Revenue Code of 1986, as
amended, the fund currently intends to comply with certain
diversification limits imposed by Subchapter M.
(ii) 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.
(iii) The fund does not currently intend to purchase securities on
margin, except that a 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.
(iv) The fund does not currently intend to hedge more than 40% of its
total assets with short sales against the box under normal conditions.
(v) 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 (2) for all stock funds). Each 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.
(vi) 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.
(vii) The fund does not currently intend to lend assets other than
securities to other parties, except (a) by lending money (up to 5% of
a 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.)
(viii) The fund does not currently intend to invest all of its assets
in the securities of a single open-end management investment company
with substantially the same fundamental investment objectives,
policies, and limitations as the funds.
For purposes of limitation (4), FMR considers an issuer to be
principally engaged in a business activity if (i) at least 50% of an
issuer's assets, income, sales or profits are committed to, or derived
from, the business activity, or (ii) a third party has given the
issuer an industry or sector classification consistent with the
designated business activity. For each of Brokerage and Investment
Management and Financial Services, an issuer that derives more than
15% of revenues or profits from brokerage or investment management
activities is considered to be principally engaged in the business
activities identified for the fund.
For purposes of limitations (1) and (2) for Gold Portfolio and
Precious Metals and Minerals Portfolio, FMR currently intends to treat
investments in securities whose redemption value is indexed to the
price of gold or other precious metals as investments in precious
metals.
For purposes of limitation (i), Subchapter M generally requires a fund
to invest no more than 25% of its total assets in securities of any
one issuer and to invest at least 50% of its total assets so that no
more than 5% of the fund's total assets are invested in securities of
any one issuer. However, Subchapter M allows unlimited investments in
cash, cash items, government securities (as defined in Subchapter M)
and securities of other investment companies. These tax requirements
are generally applied at the end of each quarter of a fund's taxable
year.
With respect to limitation (vi), if through a change in values, net
assets, or other circumstances, a 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 funds' limitations on futures and options transactions, see
the section entitled "Limitations on Futures and Options Transactions"
on page 203.
INVESTMENT LIMITATIONS OF BUSINESS SERVICES AND OUTSOURCING PORTFOLIO,
CYCLICAL INDUSTRIES PORTFOLIO, MEDICAL EQUIPMENT AND SYSTEMS
PORTFOLIO, AND NATURAL RESOURCES PORTFOLIO
THE FOLLOWING ARE THE FUNDS' FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. A FUND MAY NOT:
(1) 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;
(2) 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;
(3) 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;
(4) purchase the securities of any issuer if, as a result, less than
25% of the fund's total assets would be invested in the securities of
issuers principally engaged in the business activities having the
specific characteristics denoted by the fund;
(5) 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);
(6) 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). This limitation does not apply to Natural
Resources Portfolio (see below); or
(7) 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.
(8) 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.
NATURAL RESOURCES PORTFOLIO MAY NOT:
(1) purchase or sell physical commodities other than precious metals,
provided that the fund may sell physical commodities acquired as a
result of ownership of securities or other instruments. This
limitation 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.
THE FOLLOWING ARE NON-FUNDAMENTAL LIMITS FOR BUSINESS SERVICES AND
OUTSOURCING PORTFOLIO, CYCLICAL INDUSTRIES PORTFOLIO, MEDICAL
EQUIPMENT AND SYSTEMS PORTFOLIO, AND NATURAL RESOURCES PORTFOLIO,
WHICH MAY BE CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) For each fund, in order to qualify as a "regulated investment
company" under Subchapter M of the Internal Revenue Code of 1986, as
amended, the fund currently intends to comply with certain
diversification limits imposed by Subchapter M.
(ii) 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.
(iii) 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.
(iv) The fund does not currently intend to hedge more than 40% of its
total assets with short sales against the box under normal conditions.
(v) 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 (2)). 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.
(vi) 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.
(vii) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 5% of
the fund's net assets) to a registered investment company or portfolio
for which Fidelity Management & Research Company 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.)
(viii) 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.
For purposes of limitation (4), FMR considers an issuer to be
principally engaged in a business activity if (i) at least 50% of an
issuer's assets, income, sales or profits are committed to, or derived
from, the business activity, or (ii) a third party has given the
issuer an industry or sector classification consistent with the
designated business activity.
For purposes of limitation (i), Subchapter M generally requires a fund
to invest no more than 25% of its total assets in securities of any
one issuer and to invest at least 50% of its total assets so that no
more than 5% of the fund's total assets are invested in securities of
any one issuer. However, Subchapter M allows unlimited investments in
cash, cash items, government securities (as defined in Subchapter M)
and securities of other investment companies. These tax requirements
are generally applied at the end of each quarter of a fund's taxable
year.
With respect to limitation (vi), if through a change in values, net
assets, or other circumstances, a 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 funds' limitations on futures and options transactions, see
the section entitled "Limitations on Futures and Options Transactions"
on page 205.
INVESTMENT LIMITATIONS OF SELECT MONEY MARKET PORTFOLIO (MONEY MARKET
FUND)
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND 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 (i) borrow money for
temporary or emergency purposes (not for leveraging or investment) and
(ii) engage in reverse repurchase agreements for any purpose; provided
that (i) and (ii) in combination do not exceed 33 1/3% of the fund's
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, except that
the fund will invest more than 25% of its total assets in the
financial services industry;
(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;
(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; or
(9) invest in companies for the purpose of exercising control or
management.
(10) In addition 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 with
substantially the same fundamental investment objectives, policies,
and limitations as the fund.
THE FOLLOWING ARE THE FUND'S NON-FUNDAMENTAL LIMITATIONS WHICH MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to purchase a security (other
than securities issued or guaranteed by the U.S. Government or any of
its agencies or instrumentalities, or securities of other money market
funds) if, as a result, more than 5% of its total assets would be
invested in securities of a single issuer; provided that the fund may
invest up to 25% of its total assets in the first tier securities of a
single issuer for up to three business days.
(ii) 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.
(iii) 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.
(iv) 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. 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.
(v) 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.
(vi) The fund does not currently intend to purchase physical
commodities or purchase or sell futures contracts based on physical
commodities.
(vii) The fund does not currently intend to lend assets other than
securities to other parties, except by lending money (up to 10% of the
fund's net assets) to a registered investment company or portfolio for
which FMR or an affiliate serves as investment adviser. (This
limitation does not apply to purchases of debt securities or to
repurchase agreements.)
(viii) The fund does not currently intend to invest all of its assets
in the securities of a single open-end management investment company
with substantially the same fundamental investment objective,
policies, and limitations as the fund.
For purposes of limitations (1) and (i), certain securities subject to
guarantees (including insurance, letters of credit and demand
features) are not considered securities of their issuer, but are
subject to separate diversification requirements, in accordance with
industry standard requirements for money market funds.
With respect to limitation (v), 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.
BROKERAGE AND INVESTMENT MANAGEMENT PORTFOLIO. The extent to which the
fund may invest in a company that engages in securities-related
activities is limited by federal securities laws.
FINANCIAL SERVICES PORTFOLIO. The extent to which the fund may invest
in a company that engages in securities - related activities is
limited by federal securities laws.
MULTIMEDIA PORTFOLIO. The extent to which the fund may invest in
corporate broadcast licensees is limited by Federal Communications
Commission regulations.
The following pages contain more detailed information about types
of instruments in which a fund may invest, strategies FMR may employ
in pursuit of a fund's investment objective, and a summary of related
risks. FMR may not buy all of these instruments or use all of these
techniques unless it believes that doing so will help a 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 Securities and Exchange Commission (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.
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.
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.
COMPANIES "PRINCIPALLY ENGAGED" IN A DESIGNATED BUSINESS ACTIVITY. For
purposes of each stock fund's policy of investing at least 80% of its
assets in securities of companies principally engaged in the business
activities identified for the fund, FMR considers a company to be
principally engaged in a designated business activity if: (i) at least
50% of a company's assets, income, sales or profits are committed to,
or derived from, the business activity, or (ii) a third party has
given the company an industry or sector classification consistent with
the designated business activity. For each of Brokerage and Investment
Management and Financial Services, an issuer that derives more than
15% of revenues or profits from brokerage or investment management
activities is considered to be principally engaged in the business
activities identified for the fund.
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.
DOMESTIC AND FOREIGN INVESTMENTS (MONEY MARKET FUND ONLY) include U.S.
dollar-denominated time deposits, certificates of deposit, and
bankers' acceptances of U.S. banks and their branches located outside
of the United States, U.S. branches and agencies of foreign banks, and
foreign branches of foreign banks. Domestic and foreign investments
may also include U.S. dollar-denominated securities issued or
guaranteed by other U.S. or foreign issuers, including U.S. and
foreign corporations or other business organizations, foreign
governments, foreign government agencies or instrumentalities, and
U.S. and foreign financial institutions, including savings and loan
institutions, insurance companies, mortgage bankers, and real estate
investment trusts, as well as banks.
The obligations of foreign branches of U.S. banks may be general
obligations of the parent bank in addition to the issuing branch, or
may be limited by the terms of a specific obligation and by
governmental regulation. Payment of interest and repayment of
principal on these obligations may also be affected by governmental
action in the country of domicile of the branch (generally referred to
as sovereign risk). In addition, evidence of ownership of portfolio
securities may be held outside of the United States and a fund may be
subject to the risks associated with the holding of such property
overseas. Various provisions of federal law governing the
establishment and operation of U.S. branches do not apply to foreign
branches of U.S. banks.
Obligations of U.S. branches and agencies of foreign banks may be
general obligations of the parent bank in addition to the issuing
branch, or may be limited by the terms of a specific obligation and by
federal and state regulation, as well as by governmental action in the
country in which the foreign bank has its head office.
Obligations of foreign issuers involve certain additional risks. These
risks may include future unfavorable political and economic
developments, withholding taxes, seizures of foreign deposits,
currency controls, interest limitations, or other governmental
restrictions that might affect repayment of principal or payment of
interest, or the ability to honor a credit commitment. Additionally,
there may be less public information available about foreign entities.
Foreign issuers may be subject to less governmental regulation and
supervision than U.S. issuers. Foreign issuers also generally are not
bound by uniform accounting, auditing, and financial reporting
requirements comparable to those applicable to U.S. issuers.
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 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. A stock fund 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 FMR.
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 FMR'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 FMR anticipates. For example, if a
currency's value rose at a time when FMR had hedged a fund by selling
that currency in exchange for dollars, a fund would not participate in
the currency's appreciation. If FMR 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 FMR 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 FMR's use of currency management strategies will
be advantageous to a fund or that it will hedge at appropriate times.
FUNDS' RIGHTS AS SHAREHOLDERS. The 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 FMR 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. FMR 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 Standard & Poor's 500 Index (S&P 500). 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.
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.
LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. Each stock 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, each stock 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 stock 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. Under the supervision of the Board of Trustees,
FMR 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).
INDEXED SECURITIES are instruments whose prices are indexed to the
prices of other securities, securities indices, currencies, precious
metals or other commodities, 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.
Gold-indexed securities typically provide for a maturity value that
depends on the price of gold, resulting in a security whose price
tends to rise and fall together with gold prices. Currency-indexed
securities typically are short-term to intermediate-term debt
securities whose maturity values or interest rates are determined by
reference to the values of one or more specified foreign currencies,
and may offer higher yields than U.S. dollar-denominated securities.
Currency-indexed securities may be positively or negatively indexed;
that is, their maturity value may increase when the specified currency
value increases, resulting in a security that performs similarly to a
foreign-denominated instrument, or their maturity value may decline
when foreign currencies increase, resulting in a security whose price
characteristics are similar to a put on the underlying currency.
Currency-indexed securities may also have prices that depend on the
values of a number of different foreign currencies relative to each
other.
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.
Gold Portfolio, Natural Resources Portfolio, and Precious Metals and
Minerals Portfolio may purchase securities indexed to the price of
precious metals as an alternative to direct investment in precious
metals. Because the value of these securities is directly linked to
the price of gold or other precious metals, they involve risks and
pricing characteristics similar to direct investments in precious
metals. The funds will purchase precious metals-indexed securities
only when FMR is satisfied with the creditworthiness of the issuers
liable for payment. The securities generally will earn a nominal rate
of interest while held by the funds, and may have maturities of one
year or more. In addition, the securities may be subject to being put
by a fund to the issuer, with payment to be received on no more than
seven days' notice. The put feature would ensure the liquidity of the
notes in the absence of an active secondary market.
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.
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.
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 (see each fund's
investment limitations). 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.
MONEY MARKET INSURANCE. The money market fund participates in a mutual
insurance company solely with other funds advised by FMR or its
affiliates. This company provides insurance coverage for losses on
certain money market instruments held by a participating fund
(eligible instruments), including losses from nonpayment of principal
or interest or a bankruptcy or insolvency of the issuer or credit
support provider, if any. The insurance does not cover losses
resulting from changes in interest rates or other market developments.
The money market fund is charged an annual premium for the insurance
coverage and may be subject to a special assessment of up to
approximately two and one-half times the fund's annual gross premium
if covered losses exceed certain levels. A participating fund may
recover no more than $100 million annually, including all other claims
of insured funds, and may only recover if the amount of the loss
exceeds 0.30% of its eligible instruments. The money market fund may
incur losses regardless of the insurance.
MONEY MARKET SECURITIES are high-quality, short-term obligations.
Money market securities may be structured to be, or may employ a trust
or other form so that they are, eligible investments for money market
funds. For example, put features can be used to modify the maturity of
a security or interest rate adjustment features can be used to enhance
price stability. If a structure fails to function as intended, adverse
tax or investment consequences may result. Neither the Internal
Revenue Service (IRS) nor any other regulatory authority has ruled
definitively on certain legal issues presented by certain structured
securities. Future tax or other regulatory determinations could
adversely affect the value, liquidity, or tax treatment of the income
received from these securities or the nature and timing of
distributions made by the fund.
MUNICIPAL SECURITIES are issued to raise money for a variety of public
or private purposes, including general financing for state and local
governments, or financing for specific projects or public facilities.
They may be issued in anticipation of future revenues and may be
backed by the full taxing power of a municipality, the revenues from a
specific project, or the credit of a private organization. The value
of some or all municipal securities may be affected by uncertainties
in the municipal market related to legislation or litigation involving
the taxation of municipal securities or the rights of municipal
securities holders. A municipal security may be owned directly or
through a participation interest.
PRECIOUS METALS. Precious metals, such as gold, silver, platinum and
palladium, at times have been subject to substantial price
fluctuations over short periods of time and may be affected by
unpredictable monetary and political policies such as currency
devaluations or revaluations, economic and social conditions within a
country, trade imbalances, or trade or currency restrictions between
countries. The prices of gold and other precious metals, however, are
less subject to local and company-specific factors than securities of
individual companies. As a result, precious metals may be more or less
volatile in price than securities of companies engaged in precious
metals-related businesses. Investments in precious metals can present
concerns such as delivery storage and maintenance, possible
illiquidity, and the unavailability of accurate market valuations.
Although precious metals can be purchased in any form, including
bullion and coins, FMR intends to purchase only those forms of
precious metals that are readily marketable and that can be stored in
accordance with custody regulations applicable to mutual funds. A fund
may incur higher custody and transaction costs for precious metals
than for securities. Also, precious metals investments do not pay
income.
For a fund to qualify as a regulated investment company under current
federal tax law, gains from selling precious metals may not exceed 10%
of the fund's gross income for its taxable year. This tax requirement
could cause a fund to hold or sell precious metals or securities when
it would not otherwise do so.
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.
PUT FEATURES entitle the holder to sell a security back to the issuer
or a third party at any time or at specified intervals. In exchange
for this benefit, a fund may accept a lower interest rate. Securities
with put features are subject to the risk that the put provider is
unable to honor the put feature (purchase the security). Put providers
often support their ability to buy securities on demand by obtaining
letters of credit or other guarantees from other entities. Demand
features, standby commitments, and tender options are types of put
features.
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.
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. The funds will enter into
reverse repurchase agreements with parties whose creditworthiness has
been reviewed and found satisfactory by FMR. 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.
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 FMR to be of good
standing. Furthermore, they will only be made if, in FMR's judgment,
the consideration to be earned from such loans would justify the risk.
FMR 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.
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).
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.
Short sales against the box could be used to protect the net asset
value per share (NAV) of a money market fund in anticipation of
increased interest rates, without sacrificing the current yield of the
securities sold short. A money market fund will incur transaction
costs in connection with opening and closing short sales against the
box. A stock 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 entities such as banks and other financial institutions. FMR may
rely on its evaluation 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 money market securities, although stripped
securities may be more volatile. 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.
Because the SEC does not consider privately stripped government
securities to be U.S. Government securities for purposes of Rule 2a-7,
a fund must evaluate them as it would non-government securities
pursuant to regulatory guidelines applicable to money market funds.
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. 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.
The most significant factor in the performance of swap agreements is
the change in the specific interest rate, 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.
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. When FMR considers it appropriate for
defensive purposes, each stock fund (except Business Services and
Outsourcing, Cyclical Industries, Medical Equipment and Systems, and
Natural Resources) may temporarily invest substantially in
investment-grade debt securities.
Each of Business Services and Outsourcing, Cyclical Industries,
Medical Equipment and Systems and Natural Resources reserves the right
to invest without limitation in preferred stocks and investment-grade
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.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed
on behalf of each fund by FMR pursuant to authority contained in the
management contract. FMR 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, FMR considers 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, if applicable, arrangements for payment of
fund expenses.
If FMR grants investment management authority to a sub-adviser (see
the section entitled "Management Contracts"), that sub-adviser is
authorized to place orders for the purchase and sale of portfolio
securities, and will do so in accordance with the policies described
above.
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.
Each fund may execute portfolio transactions with broker-dealers who
provide research and execution services to the fund or other
investment accounts over which FMR or its 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 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.
For transactions in fixed-income securities, 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.
The receipt of research from broker-dealers that execute transactions
on behalf of a fund may be useful to FMR 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 FMR clients may be useful to FMR in carrying
out its obligations to a fund. The receipt of such research has not
reduced FMR's normal independent research activities; however, it
enables FMR to avoid the additional expenses that could be incurred if
FMR 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 a fund to pay such higher commissions, FMR
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 overall responsibilities to that fund or its
other clients. In reaching this determination, FMR 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, FMR is 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. 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. Prior to December 9, 1997, FMR 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
a 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 each fund periodically review FMR's performance of its
responsibilities in connection with the placement of portfolio
transactions on behalf of the fund 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.
For the fiscal periods ended February 28, 1999 and 1998, the portfolio
turnover rates for the stock funds (except Medical Equipment and
Systems for 1998) are presented in the table below. Variations in
turnover rate may be due to a fluctuating volume of shareholder
purchase and redemption orders, market conditions, or changes in FMR's
investment outlook.
Turnover Rates Fiscal 1999 Fiscal 1998
Air Transportation 260% 294%
Automotive 96% 153%
Biotechnology 86% 162%
Brokerage and Investment 59% 100%
Management
Business Services and 115% 36%A
Outsourcing
Chemicals 141% 31%
Computers 133% 333%
Construction and Housing 226% 404%
Consumer Industries 150% 199%
Cyclical Industries 103% 140%A
Defense and Aerospace 221% 311%
Developing Communications 299% 383%
Electronics 160% 435%
Energy 138% 115%
Energy Service 75% 78%
Environmental Services 123% 59%
Financial Services 60% 84%
Food and Agriculture 68% 74%
Gold 59% 89%
Health Care 66% 79%
Home Finance 18% 54%
Industrial Equipment 84% 115%
Industrial Materials 82% 118%
Insurance 72% 157%
Leisure 107% 209%
Medical Delivery 67% 109%
Medical Equipment and Systems 85%A N/A
Multimedia 109% 219%
Natural Gas 107% 118%
Natural Resources 155% 165%A
Paper and Forest Products 338% 235%
Precious Metals and Minerals 53% 84%
Regional Banks 22% 25%
Retailing 165% 308%
Software and Computer Services 72% 145%
Technology 339% 556%
Telecommunications 150% 157%
Transportation 182% 210%
Utilities Growth 113% 78%
A Annualized
The following tables show the brokerage commissions paid by the funds.
Significant changes in brokerage commissions paid by a fund from year
to year may result from changing asset levels throughout the year. A
fund may pay both commissions and spreads in connection with the
placement of portfolio transactions. For the fiscal years ended
February 1999, 1998, and 1997, the money market fund paid no brokerage
commissions.
Of the following tables, the first shows the total amount of brokerage
commissions paid by each fund to NFSC and FBS, as applicable, for the
past three fiscal years. The second table shows the approximate
percentage of aggregate brokerage commissions paid by a fund to NFSC
and FBS for transactions involving the approximate percentage of the
aggregate dollar amount of transactions for which the fund paid
brokerage commissions for the fiscal year ended 1999. NFSC and FBS are
paid on a commission basis. The second table also shows the dollar
amount of brokerage commissions paid to firms that provided research
services and the approximate dollar amount of the transactions
involved for the fiscal year ended 1999.
Fiscal Periods Ended February Total To NFSC To FBS
28
Air Transportation
1999 $ 466,528 $ 73,991 $ 0
1998 $ 377,945 $ 70,756 $ 0
1997 $ 588,326 $ 110,395 $ 609
Automotive
1999 $ 166,706 $ 23,803 $ 0
1998 $ 220,182 $ 36,417 $ 0
1997 $ 422,985 $ 66,744 $ 23,371
Biotechnology
1999 $ 443,990 $ 31,302 $ 0
1998 $ 843,401 $ 114,067 $ 15,773
1997 $ 466,616 $ 62,674 $ 1,784
Brokerage and Investment
Management
1999 $ 775,691 $ 47,015 $ 0
1998 $ 735,065 $ 86,544 $ 11,262
1997 $ 318,063 $ 61,662 $ 0
Business Services and
Outsourcing
1999 $ 100,721 $ 16,127 $ 0
1998* $ 3,710 $ 45 $ 0
Chemicals
1999 $ 152,343 $ 21,237 $ 0
1998 $ 101,154 $ 12,782 $ 17,404
1997 $ 442,545 $ 71,711 $ 31,240
Computers
1999 $ 1,257,001 $ 217,026 $ 0
1998 $ 1,763,117 $ 240,381 $ 0
1997 $ 1,247,598 $ 198,215 $ 0
Construction and Housing
1999 $ 370,610 $ 51,030 $ 0
1998 $ 218,917 $ 46,802 $ 0
1997 $ 348,359 $ 63,646 $ 0
Consumer Industries
1999 $ 117,209 $ 17,657 $ 0
1998 $ 76,547 $ 15,031 $ 0
1997 $ 121,479 $ 29,979 $ 0
Cyclical Industries
1999 $ 5,884 $ 579 $ 0
1998** $ 5,529 $ 470 $ 0
Defense and Aerospace
1999 $ 163,499 $ 29,426 $ 0
1998 $ 321,753 $ 60,895 $ 0
1997 $ 170,650 $ 24,182 $ 0
Developing Communications
1999 $ 757,140 $ 91,601 $ 0
1998 $ 699,196 $ 100,909 $ 3,085
1997 $ 657,790 $ 92,344 $ 24,230
Electronics
1999 $ 3,599,050 $ 363,022 $ 0
1998 $ 8,057,183 $ 1,038,942 $ 0
1997 $ 2,768,382 $ 595,711 $ 0
Energy
1999 $ 423,125 $ 48,921 $ 0
1998 $ 481,212 $ 56,921 $ 0
1997 $ 275,437 $ 53,327 $ 0
Fiscal Periods Ended February Total To NFSC To FBS
28
Energy Service
1999 $ 1,321,362 $ 132,958 $ 0
1998 $ 1,428,931 $ 208,445 $ 0
1997 $ 971,677 $ 263,380 $ 1,026
Environmental Services
1999 $ 72,365 $ 14,545 $ 0
1998 $ 53,033 $ 4,927 $ 0
1997 $ 240,792 $ 42,243 $ 0
Financial Services
1999 $ 506,934 $ 45,514 $ 0
1998 $ 467,674 $ 58,925 $ 0
1997 $ 330,933 $ 77,580 $ 0
Food and Agriculture
1999 $ 357,895 $ 54,460 $ 0
1998 $ 271,283 $ 44,060 $ 0
1997 $ 439,321 $ 97,562 $ 0
Gold
1999 $ 607,659 $ 16,916 $ 0
1998 $ 1,178,299 $ 91,784 $ 0
1997 $ 898,281 $ 82,611 $ 0
Health Care
1999 $ 2,810,021 $ 244,159 $ 0
1998 $ 1,780,678 $ 202,696 $ 39,030
1997 $ 1,330,539 $ 208,545 $ 19,436
Home Finance
1999 $ 858,979 $ 118,062 $ 0
1998 $ 999,285 $ 222,404 $ 11,072
1997 $ 824,781 $ 201,617 $ 0
Industrial Equipment
1999 $ 66,813 $ 8,504 $ 0
1998 $ 186,022 $ 28,906 $ 0
1997 $ 372,936 $ 78,288 $ 1,152
Industrial Materials
1999 $ 25,143 $ 3,612 $ 0
1998 $ 138,995 $ 19,267 $ 0
1997 $ 281,500 $ 37,253 $ 0
Insurance
1999 $ 171,027 $ 17,412 $ 0
1998 $ 249,991 $ 41,261 $ 4,571
1997 $ 51,916 $ 12,029 $ 0
Leisure
1999 $ 364,791 $ 84,286 $ 0
1998 $ 444,121 $ 113,958 $ 0
1997 $ 234,434 $ 56,198 $ 0
Medical Delivery
1999 $ 244,378 $ 23,772 $ 0
1998 $ 294,080 $ 54,751 $ 0
1997 $ 409,668 $ 62,985 $ 0
Medical Equipment and Systems
1999*** $ 14,974 $ 3,290 $ 0
Multimedia
1999 $ 156,430 $ 41,770 $ 0
1998 $ 213,979 $ 40,201 $ 0
1997 $ 181,181 $ 19,584 $ 0
Fiscal Periods Ended February Total To NFSC To FBS
28
Natural Gas
1999 $ 155,015 $ 13,630 $ 0
1998 $ 246,019 $ 38,095 $ 0
1997 $ 591,400 $ 75,903 $ 904
Natural Resources
1999 $ 17,047 $ 2,189 $ 0
1998**** $ 23,485 $ 1,465 $ 0
Paper and Forest Products
1999 $ 140,355 $ 15,977 $ 0
1998 $ 118,872 $ 11,543 $ 0
1997 $ 104,451 $ 22,646 $ 1,146
Precious Metals and Minerals
1999 $ 413,864 $ 11,498 $ 0
1998 $ 736,052 $ 34,762 $ 0
1997 $ 655,032 $ 43,075 $ 0
Regional Banks
1999 $ 615,558 $ 16,496 $ 0
1998 $ 372,550 $ 70,122 $ 0
1997 $ 385,163 $ 86,165 $ 0
Retailing
1999 $ 587,848 $ 155,653 $ 0
1998 $ 721,512 $ 132,299 $ 0
1997 $ 1,026,572 $ 250,241 $ 0
Software and Computer Services
1999 $ 273,818 $ 38,702 $ 0
1998 $ 444,769 $ 71,604 $ 0
1997 $ 559,248 $ 86,634 $ 0
Technology
1999 $ 1,912,128 $ 323,190 $ 0
1998 $ 2,228,245 $ 349,497 $ 0
1997 $ 1,737,289 $ 339,229 $ 574
Telecommunications
1999 $ 1,198,509 $ 123,641 $ 0
1998 $ 1,091,330 $ 81,847 $ 0
1997 $ 1,288,951 $ 103,768 $ 58,688
Transportation
1999 $ 86,899 $ 12,152 $ 0
1998 $ 144,625 $ 18,070 $ 0
1997 $ 23,737 $ 4,001 $ 44
Utilities Growth
1999 $ 789,881 $ 23,956 $ 0
1998 $ 317,455 $ 29,653 $ 1,975
1997 $ 167,248 $ 23,690 $ 2,643
* Business Services and Outsourcing commenced operations on February
4, 1998.
** Cyclical Industries commenced operations on March 3, 1997.
*** Medical Equipment and Systems commenced operations on April 28,
1998.
**** Natural Resources commenced operations on March 3, 1997.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Fiscal Period Ended February % of Aggregate Commissions % of Aggregate Dollar Amount $ Amount of Commissions Paid
28, 1999 Paid to NFSC(dagger) of Transactions Effected To Firms that Provided
through NFSC Research Services*
Air TransportationA 15.85% 24.48% $ 442,411
AutomotiveA 14.28% 26.75% $ 149,860
BiotechnologyA 7.05% 26.73% $ 414,009
Brokerage and Investment 6.06% 9.39% $ 700,728
ManagementA
Business Services and 16.01% 23.70% $ 89,287
OutsourcingA
ChemicalsA 13.94% 21.71% $ 136,297
ComputersA 17.27% 23.05% $ 1,228,387
Construction and HousingA 13.77% 25.24% $ 340,925
Consumer IndustriesA 15.06% 20.49% $ 75,270
Cyclical IndustriesA 9.84% 16.78% $ 4,330
Defense and AerospaceA 18.00% 20.08% $ 144,207
Developing CommunicationsA 12.10% 18.76% $ 728,997
ElectronicsA 10.08% 15.04% $ 3,536,965
EnergyA 11.56% 20.31% $ 393,142
Energy ServiceA 10.06% 13.96% $ 1,224,413
Environmental ServicesA 20.10% 32.97% $ 58,839
Financial ServicesA 8.98% 15.43% $ 473,989
Food and AgricultureA 15.22% 25.36% $ 337,596
GoldA 2.78% 7.34% $ 571,922
Health CareA 8.69% 18.25% $ 2,716,085
Home FinanceA 13.75% 19.25% $ 775,148
Industrial EquipmentA 12.73% 17.61% $ 59,833
Industrial MaterialsA 14.37% 24.61% $ 19,417
InsuranceA 10.18% 16.96% $ 155,633
LeisureA 23.11% 37.50% $ 341,029
Medical DeliveryA 9.72% 17.91% $ 240,728
Medical Equipment and SystemsA 21.97% 29.67% $ 10,723
MultimediaA 26.70% 37.25% $ 139,952
Natural GasA 8.79% 15.43% $ 135,733
Natural ResourcesA 12.85% 25.12% $ 14,008
Paper and Forest ProductsA 11.39% 22.44% $ 110,406
Precious Metals and MineralsA 2.78% 6.45% $ 376,214
Regional BanksA 2.68% 4.80% $ 603,332
RetailingA 26.48% 36.45% $ 526,182
Software and Computer ServicesA 14.13% 21.79% $ 263,467
TechnologyA 16.90% 21.74% $ 1,849,609
TelecommunicationsA 10.32% 15.24% $ 1,100,051
TransportationA 13.98% 16.00% $ 74,517
Utilities GrowthA 3.04% 6.16% $ 674,254
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Fiscal Period Ended February $ Amount of Brokerage
28, 1999 Transactions Involved*
Air TransportationA $ 368,739,031
AutomotiveA $ 113,886,936
BiotechnologyA $ 360,645,234
Brokerage and Investment $ 742,337,817
ManagementA
Business Services and $ 52,022,736
OutsourcingA
ChemicalsA $ 108,247,155
ComputersA $ 1,631,682,148
Construction and HousingA $ 264,641,924
Consumer IndustriesA $ 74,099,816
Cyclical IndustriesA $ 2,981,631
Defense and AerospaceA $ 149,178,757
Developing CommunicationsA $ 739,946,207
ElectronicsA $ 3,033,778,555
EnergyA $ 280,314,569
Energy ServiceA $ 814,196,283
Environmental ServicesA $ 29,241,397
Financial ServicesA $ 592,807,308
Food and AgricultureA $ 283,642,508
GoldA $ 177,008,865
Health CareA $ 2,678,193,388
Home FinanceA $ 566,166,569
Industrial EquipmentA $ 45,615,265
Industrial MaterialsA $ 13,276,912
InsuranceA $ 146,056,202
LeisureA $ 333,386,076
Medical DeliveryA $ 123,807,682
Medical Equipment and SystemsA $ 12,833,460
MultimediaA $ 144,555,999
Natural GasA $ 78,898,705
Natural ResourcesA $ 9,544,699
Paper and Forest ProductsA $ 75,447,265
Precious Metals and MineralsA $ 128,927,976
Regional BanksA $ 705,809,048
RetailingA $ 555,755,250
Software and Computer ServicesA $ 290,036,364
TechnologyA $ 1,967,336,754
TelecommunicationsA $ 1,060,209,460
TransportationA $ 60,669,697
Utilities GrowthA $ 550,058,911
</TABLE>
* The provisions of research services was not necessarily a factor in
the placement of all this business with such firms.
(dagger) The difference between the percentage of aggregate brokerage
commissions paid to, and the percentage of the aggregate dollar mount
of transactions effected through NFSC and is a result of the low
commission rates charged by NFSC.
A Broker-dealer affiliates of FMR have used a portion of the
commissions paid by a fund to reduce that fund's custodian or transfer
agent fees.
The Trustees of each 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 funds 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 funds could purchase in the underwriting.
From time to time the Trustees will review whether the recapture for
the benefit of the 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 each fund are substantially the
same as those of other funds managed by FMR or its affiliates,
investment decisions for each fund 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,
particularly when the same security is suitable for the investment
objective of more than one fund or investment account.
When two or more 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 FMR as investment adviser to each fund
outweighs any disadvantages that may be said to exist from exposure to
simultaneous transactions.
VALUATION
Each fund's NAV is the value of a single share. The NAV of each 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.
STOCK 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. 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.
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 American Depositary Receipts (ADRs), market and
trading trends, the bid/ask quotes of brokers and off-exchange
institutional trading.
MONEY MARKET FUND. Portfolio securities and other assets are valued on
the basis of amortized cost. This technique involves initially valuing
an instrument at its cost as adjusted for amortization of premium or
accretion of discount rather than its current market value. The
amortized cost value of an instrument may be higher or lower than the
price the fund would receive if it sold the instrument.
Securities of other open-end investment companies are valued at their
respective NAVs.
At such intervals as they deem appropriate, the Trustees consider the
extent to which NAV calculated by using market valuations would
deviate from the $1.00 per share calculated using amortized cost
valuation. If the Trustees believe that a deviation from the fund's
amortized cost per share may result in material dilution or other
unfair results to shareholders, the Trustees have agreed to take such
corrective action, if any, as they deem appropriate to eliminate or
reduce, to the extent reasonably practicable, the dilution or unfair
results. Such corrective action could include selling portfolio
instruments prior to maturity to realize capital gains or losses or to
shorten average portfolio maturity; withholding dividends; redeeming
shares in kind; establishing NAV by using available market quotations;
and such other measures as the Trustees may deem appropriate.
PERFORMANCE
A fund may quote performance in various ways. All performance
information supplied by the funds in advertising is historical and is
not intended to indicate future returns. The share price of a stock
fund, the yield of the money market fund, and return fluctuate in
response to market conditions and other factors, and the value of a
stock fund's shares when redeemed may be more or less than their
original cost.
YIELD CALCULATIONS (MONEY MARKET FUND). To compute the yield for the
fund for a period, the net change in value of a hypothetical account
containing one share reflects the value of additional shares purchased
with dividends from the one original share and dividends declared on
both the original share and any additional shares. The net change is
then divided by the value of the account at the beginning of the
period to obtain a base period return. This base period return is
annualized to obtain a current annualized yield. The fund also may
calculate an effective yield by compounding the base period return
over a one-year period. In addition to the current yield, the
fund may quote yields in advertising based on any historical
seven-day period. Yields for the fund are calculated on the same basis
as other money market funds, as required by applicable regulation.
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.
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. 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 and may be
quoted with or without taking each fund's maximum sales charge into
account, and may or may not include the effect of a stock fund's
trading fee. Excluding a fund's sales charge or trading fee from a
return calculation produces a higher return figure. Returns, yields,
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 a 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 stock 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. As
of February 26, 1999, the 13-week and 39-week short-term moving
averages are shown below.
<TABLE>
<CAPTION>
<S> <C> <C>
Fund Name 13-Week Short-Term Moving 39-Week Short-Term Moving
Average Average
Air Transportation $ 25.92 $ 25.42
Automotive $ 24.14 $ 23.66
Biotechnology $ 39.15 $ 34.11
Brokerage and Investment $ 39.41 $ 38.48
Management
Business Services and $ 13.30 $ 11.97
Outsourcing
Chemicals $ 31.76 $ 32.88
Computers $ 69.31 $ 54.61
Construction and Housing $ 26.52 $ 25.27
Consumer Industries $ 30.91 $ 28.80
Cyclical Industries $ 11.55 $ 11.41
Defense and Aerospace $ 33.84 $ 33.59
Developing Communications $ 31.03 $ 24.43
Electronics $ 49.40 $ 37.80
Energy $ 17.30 $ 18.58
Energy Service $ 14.31 $ 17.69
Environmental Services $ 13.21 $ 13.81
Financial Services $ 97.52 $ 94.72
Food and Agriculture $ 47.53 $ 45.70
Gold $ 13.45 $ 12.91
Health Care $ 133.76 $ 124.71
Home Finance $ 42.37 $ 45.05
Industrial Equipment $ 25.61 $ 24.66
Industrial Materials $ 20.63 $ 21.08
Insurance $ 41.61 $ 39.91
Leisure $ 75.54 $ 66.62
Medical Delivery $ 21.19 $ 22.85
Medical Equipment and Systems $ 11.88 $ 10.96
Multimedia $ 40.36 $ 35.89
Natural Gas $ 11.07 $ 11.80
Natural Resources $ 8.43 $ 9.02
Paper and Forest Products $ 18.57 $ 18.78
Precious Metals and Minerals $ 9.70 $ 9.15
Regional Banks $ 41.32 $ 40.52
Retailing $ 63.47 $ 57.02
Software and Computer Services $ 54.48 $ 47.36
Technology $ 81.61 $ 63.92
Telecommunications $ 59.92 $ 53.88
Transportation $ 23.57 $ 22.52
Utilities Growth $ 60.10 $ 53.01
</TABLE>
CALCULATING HISTORICAL FUND RESULTS. The following table shows
performance for each fund. The money market fund's returns include the
effect of the fund's 3% sales charge. For each stock fund, returns
include the effect of the fund's 3% sales charge and trading fee, but
do not include the effect of the fund's exchange fee.
HISTORICAL FUND RESULTS. The following table shows the money market
fund's 7-day yield and each fund's returns for fiscal periods ended
February 28, 1999.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Average Annual Total Returns Cumulative Total Returns
Seven-Day Yield One Year Five Years Ten Years/Life of Fund One Year Five Years
Air Transportation 0.92% 13.38% 12.79% 0.92% 87.35%
Automotive -11.34% 4.80% 12.32% -11.34% 26.41%
Biotechnology 23.25% 15.01% 21.19% 23.25% 101.27%
Brokerage and Investment 1.55% 21.24% 20.21% 1.55% 162.01%
Management
Business Services and 22.37% N/A 30.92%* 22.37% N/A
Outsourcing
Chemicals -26.02% 7.34% 10.80% -26.02% 42.53
Computers 61.37% 33.09% 27.76% 61.37% 317.58%
Construction and Housing -5.17% 10.91% 14.36% -5.17% 67.84%
Consumer Industries 16.50% 18.63% 18.36%* 16.50% 134.96%
Cyclical Industries -7.89% N/A 7.67%* -7.89% N/A
Defense and Aerospace -12.68% 17.26% 14.31% -12.68% 121.70%
Developing Communications 58.05% 23.24% 24.19%* 58.05% 184.27%
Electronics 31.16% 33.54% 29.22% 31.16% 324.64%
Energy -24.41% 5.80% 7.30% -24.41% 32.55%
Energy Service -52.12% 7.09% 7.43% -52.12% 40.85%
Environmental Services -24.64% 1.89% 3.62%* -24.64% 9.82%
Financial Services 5.10% 23.97% 21.55% 5.10% 192.77%
Food and Agriculture 4.52% 17.39% 17.91% 4.52% 122.96%
Gold -18.29% -10.03% -1.56% -18.29% -41.06%
Health Care 23.31% 30.02% 25.50% 23.31% 271.61%
Home Finance -21.62% 19.79% 21.49% -21.62% 146.66%
Industrial Equipment -2.11% 14.34% 15.21% -2.11% 95.46%
Industrial Materials -21.23% 2.93% 6.81% -21.23% 15.52%
Insurance 6.47% 22.64% 18.78% 6.47% 177.44%
Leisure 33.34% 22.26% 18.87% 33.34% 173.15%
Medical Delivery -31.66% 8.14% 15.49% -31.66% 47.91%
Medical Equipment and Systems N/A N/A N/A N/A N/A
Multimedia 32.51% 21.07% 18.08% 32.51% 160.12%
Natural Gas -21.66% 2.95% 1.83%* -21.66% 15.62%
Natural Resources -26.91% N/A -11.48%* -26.91% N/A
Paper and Forest Products -19.57% 5.27% 8.51% -19.57% 29.29%
Precious Metals and Minerals -13.64% -11.45% -2.04% -13.64% -45.55%
Regional Banks -0.06% 24.36% 22.80% -0.06% 197.48%
Retailing 32.49% 22.03% 22.15% 32.49% 170.61%
Software and Computer 28.52% 23.66% 24.24% 28.52% 189.20%
Services
Technology 50.91% 27.34% 25.76% 50.91% 234.89%
Telecommunications 18.47% 20.53% 19.05% 18.47% 154.38%
Transportation -4.75% 10.98% 14.82% -4.75% 68.38%
Utilities Growth 28.13% 21.06% 17.76% 28.13% 160.01%
Money Market 4.76% 1.93% 4.40% 4.96% 1.93% 24.03%
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Cumulative Total Returns
Ten Years/Life of Fund
Air Transportation 233.08%
Automotive 219.47%
Biotechnology 583.45%
Brokerage and Investment 529.90%
Management
Business Services and 33.27%*
Outsourcing
Chemicals 178.89%
Computers 1058.44%
Construction and Housing 282.71%
Consumer Industries 330.97%*
Cyclical Industries 15.87%*
Defense and Aerospace 281.02%
Developing Communications 553.58%*
Electronics 1198.23%
Energy 102.37%
Energy Service 104.77%
Environmental Services 41.11%*
Financial Services 603.96%
Food and Agriculture 419.46%
Gold -14.57%
Health Care 869.08%
Home Finance 600.51%
Industrial Equipment 312.08%
Industrial Materials 93.26%
Insurance 458.86%
Leisure 463.43%
Medical Delivery 322.30%
Medical Equipment and Systems 17.30%*
Multimedia 427.14%
Natural Gas 11.19%*
Natural Resources -21.56%*
Paper and Forest Products 126.36%
Precious Metals and Minerals -18.66%
Regional Banks 679.81%
Retailing 639.25%
Software and Computer 776.15%
Services
Technology 889.23%
Telecommunications 471.95%
Transportation 298.34%
Utilities Growth 412.70%
Money Market 62.29%
</TABLE>
* From commencement of operations (June 29, 1990 for Consumer
Industries and Developing Communications; June 29, 1989 for
Environmental Services; April 21, 1993 for Natural Gas; March 3, 1997
for Cyclical Industries and Natural Resources; February 4, 1998 for
Business Services and Outsourcing; and April 28, 1998 for Medical
Equipment and Systems).
Note: If FMR had not reimbursed certain fund expenses during these
periods, Air Transportation's, Automotive's, Biotechnology's,
Brokerage and Investment Management's, Business Services and
Outsourcing's, Chemicals', Computer's, Construction and Housing's,
Consumer Industries', Cyclical Industries', Defense and Aerospace's,
Developing Communications', Electronics', Food and Agriculture's, Home
Finance's, Industrial Equipment's, Industrial Materials', Insurance's,
Multimedia's, Natural Resources', Paper and Forest Product's, Regional
Banks', Retailing's, Software and Computer Services', and
Transportation's returns would have been lower.
The following tables show the income and capital elements of each
fund's cumulative return. The tables compare each fund's return to the
record of the Standard & Poor's 500 (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 CPI information
is as of the month-end closest to the initial investment date for each
fund. The S&P 500 and DJIA comparisons are provided to show how each
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, over the same period. Because the money
market fund invests in short-term fixed-income securities, common
stocks represent a different type of investment from the fund. Common
stocks generally offer greater growth potential than the money market
fund, but generally experience greater price volatility, which means
greater potential for loss. In addition, common stocks generally
provide lower income than a fixed-income investment such as the fund.
Each stock 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 each
fund's returns, do not include the effect of brokerage commissions or
other costs of investing.
The following tables show the growth in value of a hypothetical
$10,000 investment in each fund during the 10-year period ended
February 28, 1999 or life of fund, as applicable, assuming all
distributions were reinvested. Returns are based on past results and
are not an indication of future performance. Tax consequences of
different investments (with the exception of foreign tax withholdings)
have not been factored into the figures below.
AIR TRANSPORTATION PORTFOLIO: During the 10-year period ended February
28, 1999, a hypothetical $10,000 investment in Air Transportation
Portfolio would have grown to $ 33,315 , including the effect of
the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
AIR TRANSPORTATION PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 24,979 $ 0 $ 8,336 $ 33,315
2/28/98 24,169 0 7,829 31,998
2/28/97 15,945 0 3,917 19,862
2/29/96 18,995 0 4,388 23,383
2/28/95 12,534 0 2,561 15,095
2/28/94 15,405 0 1,837 17,242
2/28/93 12,237 0 1,240 13,477
2/29/92 12,741 0 899 13,640
2/28/91 10,681 0 521 11,202
2/28/90 9,808 0 479 10,287
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
AIR TRANSPORTATION PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Air
Transportation Portfolio on March 1, 1989, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 15,127 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 0 for dividends and $ 4,418 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
AUTOMOTIVE PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Automotive Portfolio would
have grown to $ 31,954 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
AUTOMOTIVE PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 18,693 $ 1,386 $ 11,875 $ 31,954 $ 55,921
2/28/98 22,082 1,611 11,238 34,931 46,704
2/28/97 20,380 1,390 6,680 28,450 34,595
2/29/96 17,545 1,030 5,015 23,590 27,421
2/28/95 15,931 935 4,554 21,420 20,357
2/28/94 20,460 1,133 2,912 24,505 18,962
2/28/93 16,614 876 1,295 18,785 17,502
2/29/92 13,779 679 782 15,240 15,815
2/28/91 9,909 488 0 10,397 13,633
2/28/90 9,451 329 0 9,780 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
AUTOMOTIVE PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Automotive
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 22,309 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 819 for dividends and $ 8,496 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
BIOTECHNOLOGY PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Biotechnology Portfolio
would have grown to $ 68,352 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
BIOTECHNOLOGY PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 37,416 $ 178 $ 30,758 $ 68,352 $ 55,921
2/28/98 31,235 149 22,380 53,764 46,704
2/28/97 30,982 148 15,175 46,305 34,595
2/29/96 33,118 119 10,509 43,746 27,421
2/28/95 22,893 18 7,264 30,175 20,357
2/28/94 24,983 20 7,927 32,930 18,962
2/28/93 20,450 16 6,489 26,955 17,502
2/29/92 29,815 24 4,354 34,193 15,815
2/28/91 22,965 0 1,203 24,168 13,633
2/28/90 13,102 0 218 13,320 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
BIOTECHNOLOGY PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in
Biotechnology Portfolio on March 1, 1989, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 32,291 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 109 for dividends and $ 16,450 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
BROKERAGE AND INVESTMENT MANAGEMENT PORTFOLIO: During the 10-year
period ended February 28, 1999, a hypothetical $10,000 investment in
Brokerage and Investment Management Portfolio would have grown to
$ 62,997 , including the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
BROKERAGE AND INVESTMENT INDEXES
MANAGEMENT PORTFOLIO
Year Ended Value of Initial
$10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value S&P 500 DJIA
Investment Distributions Gain Distributions
2/28/99 $ 48,103 $ 2,074 $ 12,820 $ 62,997 $ 55,921 $ 54,030
2/28/98 46,490 1,991 11,653 60,134 46,704 48,785
2/28/97 30,105 1,188 6,872 38,165 34,595 38,595
2/29/96 21,609 775 4,070 26,454 27,421 30,144
2/28/95 18,126 603 1,645 20,374 20,357 21,531
2/28/94 20,744 690 1,882 23,316 18,962 20,019
2/28/93 16,619 541 0 17,160 17,502 17,124
2/29/92 14,947 488 0 15,435 15,815 16,115
2/28/91 9,700 306 0 10,006 13,633 13,768
2/28/90 9,723 182 0 9,905 11,891 12,079
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
BROKERAGE AND INVESTMENT INDEXES
MANAGEMENT PORTFOLIO
Year Ended Cost of Living
2/28/99 $ 13,528
2/28/98 13,314
2/28/97 13,125
2/29/96 12,738
2/28/95 12,410
2/28/94 12,064
2/28/93 11,768
2/29/92 11,398
2/28/91 11,086
2/28/90 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Brokerage
and Investment Management Portfolio on March 1, 1989, assuming
the 3.00% sales charge had been in effect, the net amount invested in
fund shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $ 16,945 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 5,481 for
dividends and $ 549 for capital gain distributions. The figures
in the table do not include the effect of a stock fund's trading fee
or exchange fee.
BUSINESS SERVICES AND OUTSOURCING PORTFOLIO: During the period from
February 4, 1998 (commencement of operations) to February 28, 1999, a
hypothetical $10,000 investment in Business Services and Outsourcing
Portfolio would have grown to $ 13,335 , including the effect of
the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
BUSINESS SERVICES AND INDEXES
OUTSOURCING PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 13,163 $ 0 $ 172 $ 13,335 $ 12,495
2/28/98* 10,563 0 0 10,563 10,435
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
BUSINESS SERVICES AND INDEXES
OUTSOURCING PORTFOLIO
Year Ended DJIA Cost of Living**
2/28/99 $ 11,655 $ 10,161
2/28/98* 10,524 10,019
</TABLE>
* From February 4, 1998 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Business
Services and Outsourcing Portfolio on February 4, 1998, assuming the
3.00% sales charge had been in effect, the net amount invested in fund
shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $ 10,155 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 0 for dividends
and $ 155 for capital gain distributions. The figures in the
table do not include the effect of a stock fund's trading fee or
exchange fee.
CHEMICALS PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Chemicals Portfolio would
have grown to $ 27,896 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
CHEMICALS PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 13,196 $ 826 $ 13,874 $ 27,896 $ 55,921
2/28/98 19,476 1,160 15,905 36,541 46,704
2/28/97 18,046 1,067 11,474 30,587 34,595
2/29/96 16,773 914 8,895 26,582 27,421
2/28/95 14,389 736 5,728 20,853 20,357
2/28/94 13,434 555 4,986 18,975 18,962
2/28/93 12,144 375 2,829 15,348 17,502
2/29/92 13,532 246 1,385 15,163 15,815
2/28/91 10,964 123 811 11,898 13,633
2/28/90 9,577 64 458 10,099 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
CHEMICALS PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Chemicals
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 26,056 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 620 for dividends and $ 10,243 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
COMPUTERS PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Computers Portfolio would
have grown to $ 115,851 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
COMPUTERS PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 60,565 $ 1,556 $ 53,730 $ 115,851 $ 55,921
2/28/98 36,391 935 32,283 69,609 46,704
2/28/97 42,742 1,098 14,010 57,850 34,595
2/29/96 36,346 934 9,385 46,665 27,421
2/28/95 27,169 698 2,674 30,541 20,357
2/28/94 23,936 614 2,356 26,906 18,962
2/28/93 17,850 458 241 18,549 17,502
2/29/92 17,522 450 236 18,208 15,815
2/28/91 14,572 133 0 14,705 13,633
2/28/90 10,772 0 0 10,772 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
COMPUTERS PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Computers
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 37,815 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 345 for dividends and $ 20,808 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
CONSTRUCTION AND HOUSING PORTFOLIO: During the 10-year period ended
February 28, 1999, a hypothetical $10,000 investment in Construction
and Housing Portfolio would have grown to $ 38,278 , including
the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CONSTRUCTION AND HOUSING
PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 19,877 $ 609 $ 17,792 $ 38,278
2/28/98 20,361 626 18,138 39,125
2/28/97 17,477 507 9,955 27,939
2/29/96 15,539 427 7,583 23,549
2/28/95 13,338 297 5,703 19,338
2/28/94 15,746 350 6,016 22,112
2/28/93 12,504 279 4,567 17,350
2/29/92 10,852 242 3,952 15,046
2/28/91 8,977 200 2,361 11,538
2/28/90 9,033 56 1,230 10,319
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
CONSTRUCTION AND HOUSING INDEXES
PORTFOLIO
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in
Construction and Housing Portfolio on March 1, 1989, assuming the
3.00% sales charge had been in effect, the net amount invested in fund
shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $ 22,001 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 278 for
dividends and $ 8,175 for capital gain distributions. The
figures in the table do not include the effect of a stock fund's
trading fee or exchange fee.
CONSUMER INDUSTRIES PORTFOLIO: During the period from June 29, 1990
(commencement of operations) to February 28, 1999, a hypothetical
$10,000 investment in Consumer Industries Portfolio would have grown
to $ 43,104 , including the effect of the fund's 3.00% sales
charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CONSUMER INDUSTRIES PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 30,856 $ 232 $ 12,016 $ 43,104
2/28/98 26,491 200 9,175 35,866
2/28/97 20,040 152 5,361 25,553
2/29/96 17,305 130 4,630 22,065
2/28/95 13,493 82 3,397 16,972
2/28/94 14,783 90 2,916 17,789
2/28/93 12,581 77 1,193 13,851
2/29/92 13,512 83 241 13,836
2/28/91* 10,505 65 0 10,570
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
CONSUMER INDUSTRIES PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living**
2/28/99 $ 43,109 $ 40,297 $ 12,664
2/28/98 36,003 36,385 12,463
2/28/97 26,669 28,785 12,286
2/29/96 21,138 22,483 11,925
2/28/95 15,693 16,058 11,617
2/28/94 14,618 14,931 11,293
2/28/93 13,492 12,772 11,016
2/29/92 12,191 12,019 10,670
2/28/91* 10,509 10,269 10,377
</TABLE>
* From June 29, 1990 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Consumer
Industries Portfolio on June 29, 1990, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 16,802 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 78 for dividends and $ 5,645 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
CYCLICAL INDUSTRIES PORTFOLIO: During the period from March 3, 1997
(commencement of operations) to February 28, 1999, a hypothetical
$10,000 investment in Cyclical Industries Portfolio would have grown
to $ 11,594 , including the effect of the fund's 3.00% sales
charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CYCLICAL INDUSTRIES PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Divided Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 11,048 $ 0 $ 546 $ 11,594
2/28/98* 11,708 0 492 12,200
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
CYCLICAL INDUSTRIES PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living**
2/28/99 $ 16,071 $ 13,914 $ 10,307
2/28/98* 13,422 12,563 10,144
</TABLE>
* From March 3, 1997 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Cyclical
Industries Portfolio on March 3, 1997, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 10,537 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 0 for dividends and $ 534 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
DEFENSE AND AEROSPACE PORTFOLIO: During the 10-year period ended
February 28, 1999, a hypothetical $10,000 investment in Defense and
Aerospace Portfolio would have grown to $ 38,109 , including the
effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
DEFENSE AND AEROSPACE PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 27,944 $ 551 $ 9,614 $ 38,109
2/28/98 31,015 612 10,670 42,297
2/28/97 23,891 471 5,283 29,645
2/29/96 22,265 438 2,881 25,584
2/28/95 16,213 320 824 17,357
2/28/94 15,801 311 556 16,668
2/28/93 12,449 175 0 12,624
2/29/92 12,325 173 0 12,498
2/28/91 10,691 104 0 10,795
2/28/90 9,650 0 0 9,650
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
DEFENSE AND AEROSPACE PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Defense
and Aerospace Portfolio on March 1, 1989, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 17,845 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 231 for dividends and $ 6,538 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
DEVELOPING COMMUNICATIONS PORTFOLIO: During the period from June 29,
1990 (commencement of operations) to February 28, 1999, a hypothetical
$10,000 investment in Developing Communications Portfolio would have
grown to $ 65,365 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
DEVELOPING COMMUNICATIONS
PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 31,738 $ 0 $ 33,627 $ 65,365
2/28/98 19,536 0 20,563 40,099
2/28/97 19,090 0 12,194 31,284
2/29/96 18,837 0 12,034 30,871
2/28/95 19,788 0 5,549 25,337
2/28/94 19,061 0 3,238 22,299
2/28/93 15,947 0 1,174 17,121
2/29/92 13,997 0 1,002 14,999
2/28/91* 10,777 0 0 10,777
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
DEVELOPING COMMUNICATIONS INDEXES
PORTFOLIO
Year Ended S&P 500 DJIA Cost of Living**
2/28/99 $ 43,109 $ 40,297 $ 12,664
2/28/98 36,003 36,385 12,463
2/28/97 26,669 28,785 12,286
2/29/96 21,138 22,483 11,925
2/28/95 15,693 16,058 11,617
2/28/94 14,618 14,931 11,293
2/28/93 13,492 12,772 11,016
2/29/92 12,191 12,019 10,670
2/28/91* 10,509 10,269 10,377
</TABLE>
* From June 29, 1990 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Developing
Communications Portfolio on June 29, 1990, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 27,901 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 0 for dividends and $ 12,979 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
ELECTRONICS PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Electronics Portfolio would
have grown to $ 129,831 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ELECTRONICS PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 67,134 $ 83 $ 62,614 $ 129,831 $ 55,921
2/28/98 49,620 62 46,279 95,961 46,704
2/28/97 53,818 67 23,412 77,297 34,595
2/29/96 39,963 49 17,385 57,397 27,421
2/28/95 28,079 34 5,113 33,226 20,357
2/28/94 25,058 31 4,563 29,652 18,962
2/28/93 20,251 25 0 20,276 17,502
2/29/92 18,535 23 0 18,558 15,815
2/28/91 14,394 18 0 14,412 13,633
2/28/90 12,267 0 0 12,267 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
ELECTRONICS PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in
Electronics Portfolio on March 1, 1989, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 44,921 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 14 for dividends and $ 25,810 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
ENERGY PORTFOLIO: During the 10-year period ended February 28, 1999, a
hypothetical $10,000 investment in Energy Portfolio would have grown
to $ 20,244 , including the effect of the fund's 3.00% sales
charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ENERGY PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 11,954 $ 968 $ 7,322 $ 20,244 $ 55,921
2/28/98 15,614 1,254 9,087 25,955 46,704
2/28/97 15,695 1,163 4,699 21,557 34,595
2/29/96 13,972 922 3,019 17,913 27,421
2/28/95 11,858 692 2,263 14,813 20,357
2/28/94 12,322 614 1,871 14,807 18,962
2/28/93 11,667 555 1,277 13,499 17,502
2/29/92 10,437 271 1,142 11,850 15,815
2/28/91 11,394 155 1,230 12,779 13,633
2/28/90 12,676 51 164 12,891 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
ENERGY PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Energy
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 19,584 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 832 for dividends and $ 6,570 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
ENERGY SERVICE PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Energy Service Portfolio
would have grown to $ 20,484 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
ENERGY SERVICE PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 15,734 $ 178 $ 4,572 $ 20,484
2/28/98 33,680 382 7,378 41,440
2/28/97 24,593 278 3,048 27,919
2/29/96 19,340 208 1,561 21,109
2/28/95 14,388 113 669 15,170
2/28/94 14,015 84 0 14,099
2/28/93 13,234 22 0 13,256
2/29/92 11,275 19 0 11,294
2/28/91 16,227 27 0 16,254
2/28/90 14,760 0 0 14,760
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
ENERGY SERVICE PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Energy
Service Portfolio on March 1, 1989, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 17,503 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 168 for dividends and $ 6,371 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
ENVIRONMENTAL SERVICES PORTFOLIO: During the period from June 29, 1989
(commencement of operations) to February 28, 1999, a hypothetical
$10,000 investment in Environmental Services Portfolio would have
grown to $ 14,118 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ENVIRONMENTAL SERVICES INDEXES
PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 12,387 $ 11 $ 1,720 $ 14,118 $ 49,952
2/28/98 15,966 14 2,174 18,154 41,719
2/28/97 14,065 12 1,915 15,992 30,902
2/29/96 12,047 11 1,619 13,677 24,494
2/28/95 9,962 9 757 10,728 18,184
2/28/94 11,572 10 880 12,462 16,938
2/28/93 11,019 10 838 11,867 15,634
2/29/92 12,649 11 486 13,146 14,127
2/28/91 12,600 11 0 12,611 12,178
2/28/90* 10,554 9 0 10,563 10,622
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
ENVIRONMENTAL SERVICES INDEXES
PORTFOLIO
Year Ended DJIA Cost of Living**
2/28/99 $ 49,028 $ 13,255
2/28/98 44,268 13,046
2/28/97 35,022 12,861
2/29/96 27,353 12,482
2/28/95 19,537 12,160
2/28/94 18,166 11,821
2/28/93 15,539 11,531
2/29/92 14,623 11,168
2/28/91 12,493 10,862
2/28/90* 10,960 10,314
</TABLE>
* From June 29, 1989 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in
Environmental Services Portfolio on June 29, 1989, assuming the 3.00%
sales charge had been in effect, the net amount invested in fund
shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $ 11,545 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 10 for
dividends and $ 1,465 for capital gain distributions. The
figures in the table do not include the effect of a stock fund's
trading fee or exchange fee.
FINANCIAL SERVICES PORTFOLIO: During the 10-year period ended February
28, 1999, a hypothetical $10,000 investment in Financial Services
Portfolio would have grown to $ 70,403 , including the effect of
the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FINANCIAL SERVICES PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 34,877 $ 4,098 $ 31,428 $ 70,403
2/28/98 35,728 4,075 25,131 64,934
2/28/97 28,692 2,924 14,409 46,025
2/29/96 22,728 2,010 9,220 33,958
2/28/95 16,684 1,329 6,408 24,421
2/28/94 17,726 1,080 4,514 23,320
2/28/93 18,435 1,037 1,565 21,037
2/29/92 14,457 642 88 15,187
2/28/91 9,769 327 60 10,156
2/28/90 10,302 104 63 10,469
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
FINANCIAL SERVICES PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Financial
Services Portfolio on March 1, 1989, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 33,827 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 1,498 for dividends and $ 14,464 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
FOOD AND AGRICULTURE PORTFOLIO: During the 10-year period ended
February 28, 1999, a hypothetical $10,000 investment in Food and
Agriculture Portfolio would have grown to $ 51,954 , including
the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FOOD AND AGRICULTURE PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 23,929 $ 1,661 $ 26,364 $ 51,954
2/28/98 24,893 1,557 21,731 48,181
2/28/97 22,710 1,081 15,196 38,987
2/29/96 21,496 817 12,009 34,322
2/28/95 16,590 499 7,796 24,885
2/28/94 16,060 420 6,115 22,595
2/28/93 15,738 357 4,135 20,230
2/29/92 15,417 286 3,030 18,733
2/28/91 13,760 194 1,822 15,776
2/28/90 11,210 19 1,082 12,311
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
FOOD AND AGRICULTURE PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Food and
Agriculture Portfolio on March 1, 1989, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 31,946 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 841 for dividends and $ 13,280 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
GOLD PORTFOLIO: During the 10-year period ended February 28, 1999, a
hypothetical $10,000 investment in Gold Portfolio would have grown to
$ 8,551 , including the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
GOLD PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 7,932 $ 0 $ 619 $ 8,551 $ 55,921
2/28/98 9,409 0 733 10,142 46,704
2/28/97 17,496 0 343 17,839 34,595
2/29/96 16,814 0 0 16,814 27,421
2/28/95 11,437 0 0 11,437 20,357
2/28/94 14,054 0 0 14,054 18,962
2/28/93 8,776 0 0 8,776 17,502
2/29/92 8,373 0 0 8,373 15,815
2/28/91 8,441 0 0 8,441 13,633
2/28/90 11,015 0 0 11,015 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
GOLD PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Gold
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 11,126 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 0 for dividends and $ 1,110 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
HEALTH CARE PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Health Care Portfolio would
have grown to $ 96,916, including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
HEALTH CARE PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 37,241 $ 2,341 $ 57,334 $ 96,916 $ 55,921
2/28/98 30,810 1,818 43,566 76,194 46,704
2/28/97 27,728 1,484 26,620 55,832 34,595
2/29/96 27,192 1,131 18,044 46,367 27,421
2/28/95 20,604 649 11,941 33,194 20,357
2/28/94 17,135 307 7,850 25,292 18,962
2/28/93 14,228 232 6,518 20,978 17,502
2/29/92 21,516 275 6,010 27,801 15,815
2/28/91 17,700 124 2,374 20,198 13,633
2/28/90 12,011 36 230 12,277 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
HEALTH CARE PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Health
Care Portfolio on March 1, 1989, assuming the 3.00% sales charge had
been in effect, the net amount invested in fund shares was $9,700. The
cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends and capital gain distributions for the
period covered (their cash value at the time they were reinvested)
amounted to $ 47,157 . If distributions had not been reinvested,
the amount of distributions earned from the fund over time would have
been smaller, and cash payments for the period would have amounted to
$ 866 for dividends and $ 20,932 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
HOME FINANCE PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Home Finance Portfolio
would have grown to $ 70,058 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
HOME FINANCE PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 39,638 $ 3,060 $ 27,360 $ 70,058 $ 55,921
2/28/98 50,252 3,772 32,595 86,619 46,704
2/28/97 43,320 2,811 19,295 65,426 34,595
2/29/96 31,360 1,648 11,349 44,357 27,421
2/28/95 22,527 998 7,442 30,967 20,357
2/28/94 23,572 880 3,091 27,543 18,962
2/28/93 20,888 770 1,369 23,027 17,502
2/29/92 14,428 523 713 15,664 15,815
2/28/91 9,436 219 466 10,121 13,633
2/28/90 8,645 37 427 9,109 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
HOME FINANCE PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Home
Finance Portfolio on March 1, 1989, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 32,738 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 1,253 for dividends and $ 14,955 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
INDUSTRIAL EQUIPMENT PORTFOLIO: During the 10-year period ended
February 28, 1999, a hypothetical $10,000 investment in Industrial
Equipment Portfolio would have grown to $ 41,215 including the
effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
INDUSTRIAL EQUIPMENT PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 24,088 $ 545 $ 16,582 $ 41,215
2/28/98 24,737 560 15,511 40,808
2/28/97 24,355 523 7,573 32,451
2/29/96 23,973 468 3,002 27,443
2/28/95 19,133 329 590 20,052
2/28/94 19,677 339 430 20,446
2/28/93 14,359 238 0 14,597
2/29/92 13,662 226 0 13,888
2/28/91 11,285 76 0 11,361
2/28/90 11,275 0 0 11,275
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
INDUSTRIAL EQUIPMENT PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Industrial
Equipment Portfolio on March 1, 1989, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 25,754 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 306 for dividends and $ 12,068 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
INDUSTRIAL MATERIALS PORTFOLIO: During the 10-year period ended
February 28, 1999, a hypothetical $10,000 investment in Industrial
Materials Portfolio would have grown to $ 19,333 , including the
effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
INDUSTRIAL MATERIALS PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 14,644 $ 846 $ 3,843 $ 19,333
2/28/98 18,016 1,042 4,728 23,786
2/28/97 19,933 1,124 1,257 22,314
2/29/96 18,787 1,014 0 19,801
2/28/95 16,669 796 0 17,465
2/28/94 15,617 607 0 16,224
2/28/93 12,568 446 0 13,014
2/29/92 11,934 364 0 12,298
2/28/91 8,965 233 0 9,198
2/28/90 9,383 0 0 9,383
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
INDUSTRIAL MATERIALS PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Industrial
Materials Portfolio on March 1, 1989, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 15,285 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 692 for dividends and $ 4,014 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
INSURANCE PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Insurance Portfolio would
have grown to $ 55,893 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
INSURANCE PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 34,149 $ 1,142 $ 20,602 $ 55,893 $ 55,921
2/28/98 34,116 1,142 15,630 50,888 46,704
2/28/97 26,434 885 8,315 35,634 34,595
2/29/96 21,693 695 5,391 27,779 27,421
2/28/95 17,269 488 3,692 21,449 20,357
2/28/94 15,729 446 3,362 19,537 18,962
2/28/93 17,488 485 1,810 19,783 17,502
2/29/92 15,210 394 0 15,604 15,815
2/28/91 12,787 128 0 12,915 13,633
2/28/90 11,499 115 0 11,614 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
INSURANCE PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Insurance
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 24,828 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 446 for dividends and $ 10,826 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
LEISURE PORTFOLIO: During the 10-year period ended February 28, 1999,
a hypothetical $10,000 investment in Leisure Portfolio would have
grown to $ 56,350 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
LEISURE PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 30,655 $ 408 $ 25,287 $ 56,350 $ 55,921
2/28/98 23,450 313 17,208 40,971 46,704
2/28/97 18,004 240 9,572 27,816 34,595
2/29/96 17,379 232 7,645 25,256 27,421
2/28/95 15,324 204 4,263 19,791 20,357
2/28/94 17,051 228 2,727 20,006 18,962
2/28/93 13,464 179 944 14,587 17,502
2/29/92 12,026 161 843 13,030 15,815
2/28/91 9,719 130 681 10,530 13,633
2/28/90 9,677 24 678 10,379 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
LEISURE PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Leisure
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 24,331 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 113 for dividends and $10,265 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
MEDICAL DELIVERY PORTFOLIO: During the 10-year period ended February
28, 1999, a hypothetical $10,000 investment in Medical Delivery
Portfolio would have grown to $ 42,237 , including the effect of
the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
MEDICAL DELIVERY PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 21,176 $ 182 $ 20,879 $ 42,237
2/28/98 31,431 271 28,181 59,883
2/28/97 31,397 272 17,426 49,095
2/29/96 32,185 279 11,966 44,430
2/28/95 25,726 222 7,171 33,119
2/28/94 22,508 98 5,079 27,685
2/28/93 16,048 71 3,621 19,740
2/29/92 24,305 108 2,974 27,387
2/28/91 18,679 81 974 19,734
2/28/90 11,731 52 253 12,036
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MEDICAL DELIVERY PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Medical
Delivery Portfolio on March 1, 1989, assuming the 3.00% sales charge
had been in effect, the net amount invested in fund shares was $9,700.
The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 36,042 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 133 for dividends and $ 18,035 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
MEDICAL EQUIPMENT AND SYSTEMS PORTFOLIO: During the period from April
28, 1998 (commencement of operations) to February 28, 1999, a
hypothetical $10,000 investment in Medical Equipment and Systems
Portfolio would have grown to $ 11,737, including the effect of
the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
MEDICAL EQUIPMENT AND SYSTEMS
PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99* $ 11,737 $ 0 $ 0 $ 11,737
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MEDICAL EQUIPMENT AND SYSTEMS INDEXES
PORTFOLIO
Year Ended S&P 500 DJIA Cost of Living**
2/28/99* $ 11,554 $ 10,609 $ 10,123
</TABLE>
* From April 28, 1998 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Medical
Equipment and Systems Portfolio on April 28, 1998, assuming the 3.00%
sales charge had been in effect, the net amount invested in fund
shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $
10,000 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 0 for dividends
and $ 0 for capital gain distributions. The figures in the table
do not include the effect of a stock fund's trading fee or exchange
fee.
MONEY MARKET PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Money Market Portfolio
would have grown to $ 16,229 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MONEY MARKET PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 9,700 $ 6,529 $ 0 $ 16,229 $ 55,921
2/28/98 9,700 5,745 0 15,445 46,704
2/28/97 9,700 4,973 0 14,673 34,595
2/29/96 9,700 4,272 0 13,972 27,421
2/28/95 9,700 3,536 0 13,236 20,357
2/28/94 9,700 2,992 0 12,692 18,962
2/28/93 9,700 2,668 0 12,368 17,502
2/29/92 9,700 2,275 0 11,975 15,815
2/28/91 9,700 1,671 0 11,371 13,633
2/28/90 9,700 851 0 10,551 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
MONEY MARKET PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Money
Market Portfolio on March 1, 1989, assuming the 3.00% sales charge had
been in effect, the net amount invested in fund shares was $9,700. The
cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends and capital gain distributions for the
period covered (their cash value at the time they were reinvested)
amounted to $ 16,529 . If distributions had not been reinvested,
the amount of distributions earned from the fund over time would have
been smaller, and cash payments for the period would have amounted to
$ 5,004 for dividends. The fund did not distribute any capital
gains during the period.
MULTIMEDIA PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Multimedia Portfolio would
have grown to $ 52,721 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MULTIMEDIA PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 28,852 $ 32 $ 23,837 $ 52,721 $ 55,921
2/28/98 22,464 25 16,084 38,573 46,704
2/28/97 16,664 18 10,401 27,083 34,595
2/29/96 18,182 20 10,163 28,365 27,421
2/28/95 14,951 0 6,542 21,493 20,357
2/28/94 15,968 0 3,687 19,655 18,962
2/28/93 12,215 0 2,359 14,574 17,502
2/29/92 10,770 0 1,913 12,683 15,815
2/28/91 8,161 0 1,450 9,611 13,633
2/28/90 8,262 0 1,467 9,729 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
MULTIMEDIA PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Multimedia
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 22,598 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 13 for dividends and $ 9,118 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
NATURAL GAS PORTFOLIO: During the period from April 21, 1993
(commencement of operations) to February 28, 1999, a hypothetical
$10,000 investment in Natural Gas Portfolio would have grown to
$ 11,126 , including the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NATURAL GAS PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 10,272 $ 183 $ 671 $ 11,126 $ 31,830
2/28/98 12,823 103 838 13,764 26,583
2/28/97 12,125 97 436 12,658 19,691
2/29/96 11,019 78 159 11,256 15,608
2/28/95 8,711 20 125 8,856 11,587
2/28/94* 9,196 0 132 9,328 10,793
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
NATURAL GAS PORTFOLIO INDEXES
Year Ended DJIA Cost of Living**
2/28/99 $ 30,794 $ 11,424
2/28/98 27,804 11,243
2/28/97 21,997 11,083
2/29/96 17,180 10,757
2/28/95 12,271 10,479
2/28/94* 11,410 10,188
</TABLE>
* From April 21, 1993 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Natural
Gas Portfolio on April 21, 1993, assuming the 3.00% sales charge had
been in effect, the net amount invested in fund shares was $9,700. The
cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends and capital gain distributions for the
period covered (their cash value at the time they were reinvested)
amounted to $ 10,932 . If distributions had not been reinvested,
the amount of distributions earned from the fund over time would have
been smaller, and cash payments for the period would have amounted to
$ 175 for dividends and $ 728 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
NATURAL RESOURCES PORTFOLIO: During the period from March 3, 1997
(commencement of operations) to February 28, 1999, a hypothetical
$10,000 investment in Natural Gas Portfolio would have grown to
$ 7,851 , including the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
NATURAL RESOURCES PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 7,653 $ 0 $ 198 $ 7,851
2/28/98* 10,146 0 262 10,408
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
NATURAL RESOURCES PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living**
2/28/99 $ 16,071 $ 13,914 $ 10,307
2/28/98* 13,422 12,563 10,144
</TABLE>
* From March 3, 1997 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Natural
Resources Portfolio on March 3, 1997, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 10,252 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 0 for dividends and $ 252 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
PAPER AND FOREST PRODUCTS PORTFOLIO: During the 10-year period ended
February 28, 1999, a hypothetical $10,000 investment in Paper and
Forest Products Portfolio would have grown to $ 22,643 ,
including the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
PAPER AND FOREST PRODUCTS
PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 15,052 $ 1,120 $ 6,471 $ 22,643
2/28/98 18,486 1,377 7,421 27,284
2/28/97 17,646 1,266 4,704 23,616
2/29/96 16,953 1,110 3,237 21,300
2/28/95 17,246 1,056 1,207 19,509
2/28/94 15,998 980 0 16,978
2/28/93 13,118 795 0 13,913
2/29/92 12,262 665 0 12,927
2/28/91 9,635 284 0 9,919
2/28/90 9,333 116 0 9,449
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PAPER AND FOREST PRODUCTS INDEXES
PORTFOLIO
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Paper and
Forest Products Portfolio on March 1, 1989, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 18,100 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 767 for dividends and $ 5,874 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
PRECIOUS METALS AND MINERALS PORTFOLIO: During the 10-year period
ended February 28, 1999, a hypothetical $10,000 investment in Precious
Metals and Minerals Portfolio would have grown to $ 8,142 ,
including the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
PRECIOUS METALS AND MINERALS
PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 7,473 $ 669 $ 0 $ 8,142
2/28/98 8,387 750 0 9,137
2/28/97 15,990 1,431 0 17,421
2/29/96 17,099 1,486 0 18,585
2/28/95 12,457 1,035 0 13,492
2/28/94 13,559 927 0 14,486
2/28/93 8,044 448 0 8,492
2/29/92 8,933 319 0 9,252
2/28/91 8,909 235 0 9,144
2/28/90 11,625 143 0 11,768
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PRECIOUS METALS AND MINERALS INDEXES
PORTFOLIO
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Precious
Metals and Minerals Portfolio on March 1, 1989, assuming the 3.00%
sales charge had been in effect, the net amount invested in fund
shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $
10,977 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 938 for
dividends and $ 0 for capital gain distributions. The figures in
the table do not include the effect of a stock fund's trading fee or
exchange fee.
REGIONAL BANKS PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Regional Banks Portfolio
would have grown to $ 77,988 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
REGIONAL BANKS PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 39,532 $ 5,603 $ 32,853 $ 77,988
2/28/98 41,063 5,314 29,263 75,640
2/28/97 31,211 3,643 20,502 55,356
2/29/96 23,175 2,307 13,140 38,622
2/28/95 17,127 1,411 8,865 27,403
2/28/94 17,108 1,002 7,313 25,423
2/28/93 19,856 961 3,063 23,880
2/29/92 15,016 621 1,553 17,190
2/28/91 9,614 274 556 10,444
2/28/90 10,099 99 584 10,782
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
REGIONAL BANKS PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Regional
Banks Portfolio on March 1, 1989, assuming the 3.00% sales charge had
been in effect, the net amount invested in fund shares was $9,700. The
cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends and capital gain distributions for the
period covered (their cash value at the time they were reinvested)
amounted to $ 31,028 . If distributions had not been reinvested,
the amount of distributions earned from the fund over time would have
been smaller, and cash payments for the period would have amounted to
$ 1,911 for dividends and $ 12,296 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
RETAILING PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Retailing Portfolio would
have grown to $ 73,932 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
RETAILING PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 49,640 $ 604 $ 23,688 $ 73,932 $ 55,921
2/28/98 36,800 447 16,852 54,099 46,704
2/28/97 24,452 298 10,700 35,450 34,595
2/29/96 20,496 249 8,897 29,642 27,421
2/28/95 17,584 213 7,633 25,430 20,357
2/28/94 18,319 223 7,952 26,494 18,962
2/28/93 17,554 214 5,149 22,917 17,502
2/29/92 17,311 211 3,914 21,436 15,815
2/28/91 11,443 139 2,234 13,816 13,633
2/28/90 9,612 117 1,849 11,578 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
RETAILING PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Retailing
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 17,555 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 118 for dividends and $ 6,016 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
SOFTWARE AND COMPUTER SERVICES PORTFOLIO: During the 10-year period
ended February 28, 1999, a hypothetical $10,000 investment in Software
and Computer Services would have grown to $ 87,623 , including
the effect of the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
SOFTWARE AND COMPUTER INDEXES
SERVICES PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 37,620 $ 0 $ 50,003 $ 87,623 $ 55,921
2/28/98 29,166 0 36,931 66,097 46,704
2/28/97 25,423 0 23,356 48,779 34,595
2/29/96 23,855 0 18,143 41,998 27,421
2/28/95 19,156 0 10,806 29,962 20,357
2/28/94 19,038 0 10,344 29,382 18,962
2/28/93 18,201 0 3,859 22,060 17,502
2/29/92 15,361 0 3,257 18,618 15,815
2/28/91 12,422 0 717 13,139 13,633
2/28/90 9,904 0 573 10,477 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
SOFTWARE AND COMPUTER INDEXES
SERVICES PORTFOLIO
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Software
and Computer Services Portfolio on March 1, 1989, assuming the 3.00%
sales charge had been in effect, the net amount invested in fund
shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $ 37,603 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 0 for dividends
and $ 17,140 for capital gain distributions. The figures in the
table do not include the effect of a stock fund's trading fee or
exchange fee.
TECHNOLOGY PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Technology Portfolio would
have grown to $ 98,930 , including the effect of the fund's 3.00%
sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
TECHNOLOGY PORTFOLIO INDEXES
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2/28/99 $ 45,971 $ 477 $ 52,482 $ 98,930 $ 55,921
2/28/98 29,534 306 33,717 63,557 46,704
2/28/97 32,074 333 18,470 50,877 34,595
2/29/96 30,390 315 14,461 45,166 27,421
2/28/95 23,374 243 6,352 29,969 20,357
2/28/94 23,252 241 5,155 28,648 18,962
2/28/93 19,244 111 1,770 21,125 17,502
2/29/92 19,878 114 0 19,992 15,815
2/28/91 14,647 0 0 14,647 13,633
2/28/90 11,168 0 0 11,168 11,891
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
TECHNOLOGY PORTFOLIO INDEXES
Year Ended DJIA Cost of Living
2/28/99 $ 54,030 $ 13,528
2/28/98 48,785 13,314
2/28/97 38,595 13,125
2/29/96 30,144 12,738
2/28/95 21,531 12,410
2/28/94 20,019 12,064
2/28/93 17,124 11,768
2/29/92 16,115 11,398
2/28/91 13,768 11,086
2/28/90 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Technology
Portfolio on March 1, 1989, assuming the 3.00% sales charge had been
in effect, the net amount invested in fund shares was $9,700. The cost
of the initial investment ($10,000) together with the aggregate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 38,943 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 161 for dividends and $ 19,661 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
TELECOMMUNICATIONS PORTFOLIO: During the 10-year period ended February
28, 1999, a hypothetical $10,000 investment in Telecommunications
Portfolio would have grown to $ 57,202 , including the effect of
the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
TELECOMMUNICATIONS PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 29,510 $ 2,602 $ 25,090 $ 57,202
2/28/98 25,464 2,245 19,098 46,807
2/28/97 19,944 1,758 10,243 31,945
2/29/96 21,409 1,679 6,532 29,620
2/28/95 18,293 1,222 4,031 23,546
2/28/94 17,701 862 3,243 21,806
2/28/93 16,313 692 884 17,889
2/29/92 13,927 503 526 14,956
2/28/91 11,351 284 429 12,064
2/28/90 11,489 54 434 11,977
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
TELECOMMUNICATIONS PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in
Telecommunications Portfolio on March 1, 1989, assuming the 3.00%
sales charge had been in effect, the net amount invested in fund
shares was $9,700. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital
gain distributions for the period covered (their cash value at the
time they were reinvested) amounted to $ 28,339 . If
distributions had not been reinvested, the amount of distributions
earned from the fund over time would have been smaller, and cash
payments for the period would have amounted to $ 1,145 for
dividends and $ 11,799 for capital gain distributions. The
figures in the table do not include the effect of a stock fund's
trading fee or exchange fee.
TRANSPORTATION PORTFOLIO: During the 10-year period ended February 28,
1999, a hypothetical $10,000 investment in Transportation Portfolio
would have grown to $ 39,841 , including the effect of the fund's
3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
TRANSPORTATION PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 19,035 $ 77 $ 20,729 $ 39,841
2/28/98 21,544 86 18,913 40,543
2/28/97 16,899 68 11,757 28,724
2/29/96 16,663 67 10,712 27,442
2/28/95 15,607 62 8,626 24,295
2/28/94 16,473 67 6,402 22,942
2/28/93 14,200 58 3,740 17,998
2/29/92 11,760 47 2,790 14,597
2/28/91 8,575 0 2,034 10,609
2/28/90 9,381 0 1,762 11,143
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
TRANSPORTATION PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in
Transportation Portfolio on March 1, 1989, assuming the 3.00% sales
charge had been in effect, the net amount invested in fund shares was
$9,700. The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends and capital gain distributions
for the period covered (their cash value at the time they were
reinvested) amounted to $ 26,765 . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $ 30 for dividends and $ 11,175 for capital
gain distributions. The figures in the table do not include the effect
of a stock fund's trading fee or exchange fee.
UTILITIES GROWTH PORTFOLIO: During the 10-year period ended February
28, 1999, a hypothetical $10,000 investment in Utilities Growth
Portfolio would have grown to $ 51,277 , including the effect of
the fund's 3.00% sales charge.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
UTILITIES GROWTH PORTFOLIO
Year Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value
Investment Distributions Gain Distributions
2/28/99 $ 22,164 $ 6,947 $ 22,166 $ 51,277
2/28/98 19,256 5,860 13,681 38,797
2/28/97 16,546 4,671 7,269 28,486
2/29/96 15,488 3,945 4,680 24,113
2/28/95 12,554 2,818 3,793 19,165
2/28/94 13,177 2,341 3,606 19,124
2/28/93 14,933 2,097 1,622 18,652
2/29/92 13,162 1,292 720 15,174
2/28/91 12,716 586 231 13,533
2/28/90 11,971 327 0 12,298
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
UTILITIES GROWTH PORTFOLIO INDEXES
Year Ended S&P 500 DJIA Cost of Living
2/28/99 $ 55,921 $ 54,030 $ 13,528
2/28/98 46,704 48,785 13,314
2/28/97 34,595 38,595 13,125
2/29/96 27,421 30,144 12,738
2/28/95 20,357 21,531 12,410
2/28/94 18,962 20,019 12,064
2/28/93 17,502 17,124 11,768
2/29/92 15,815 16,115 11,398
2/28/91 13,633 13,768 11,086
2/28/90 11,891 12,079 10,526
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Utilities
Growth Portfolio March 1, 1989, assuming the 3.00% sales charge had
been in effect, the net amount invested in fund shares was $9,700. The
cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends and capital gain distributions for the
period covered (their cash value at the time they were reinvested)
amounted to $ 30,721 . If distributions had not been reinvested,
the amount of distributions earned from the fund over time would have
been smaller, and cash payments for the period would have amounted to
$ 3,232 for dividends and $ 10,024 for capital gain
distributions. The figures in the table do not include the effect of a
stock fund's trading fee or exchange fee.
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. Lipper may also rank based on
yield. 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.
Each stock fund may compare its performance to that of the Standard &
Poor's 500 Index, a market capitalization-weighted index of common
stocks.
Each of Consumer Industries, Food and Agriculture, Leisure,
Multimedia and Retailing may compare its performance to that of the
Goldman Sachs Consumer Industries Index , a market
capitalization-weighted index of 300 stocks designed to measure the
performance of companies in the consumer industries sector. Issues in
the index include providers of consumer services and products,
including producers of beverages-alcoholic and non-alcoholic, food,
personal care, household products and tobacco companies.
Each of Air Transportation, Automotive, Chemicals, Construction and
Housing, Cyclical Industries, Defense and Aerospace, Environmental
Services, Industrial Equipment, Industrial Materials, Paper and Forest
Products and Transportation may compare its performance to that of the
Goldman Sachs Cyclical Industries Index , a market
capitalization-weighted index of 277 stocks designed to measure the
performance of companies in the cyclical industries sector. Issues in
the index include providers of consumer and commercial goods and
services where performance is influenced by the cyclical ity of
economy, such as: manufacturers of automobiles and companies involved
with construction of residential and commercial properties, producers
of chemicals, electrical equipment and components, and providers of
environmental services.
Each of Brokerage and Investment Management, Financial Services,
Home Finance, Insurance and Regional Banks may compare its performance
to that of the Goldman Sachs Financial Services Index , a
market capitalization-weighted index of 271 stocks designed to measure
the performance of companies in the financial services sector. Issues
in the index include financial institutions providing banking
services, brokerage firms and asset managers, insurance companies, and
real estate holding and development companies.
Each of Biotechnology, Health Care, Medical Delivery and Medical
Equipment and Systems may compare its performance to that of the
Goldman Sachs Health Care Index , a market
capitalization-weighted index of 93 stocks designed to measure the
performance of companies in the health care sector. Issues in the
index include providers of health care related services including
long-term care and hospital facilities, health care management
organizations and continuing care services.
Each of Energy, Energy Service, Gold, Natural Resources and
Precious Metals and Minerals may compare its performance to that of
the Goldman Sachs Natural Resources Index , a market
capitalization-weighted index of 96 stocks designed to measure the
performance of companies in the natural resources sector. Issues in
the index include extractive industries including gold & precious
metals mining along with other mineral mining, energy companies
providing oil & gas services, and owners and operators of timber
tracts and forestry services.
Each of Business Services and Outsourcing, Computers, Developing
Communications, Electronics, Software and Computer services and
Technology may compare its performance to that of the Goldman
Sachs Technology Index , a market capitalization-weighted index
of 190 stocks designed to measure the performance of companies in the
technology sector. Issues in the index include producers of
sophisticated devices, services and software related to the fields of
computers, electronics, networking and Internet services.
Each of Natural Gas, Telecommunications and Utilities Growth may
compare its performance to that of the Goldman Sachs Utilities
Index , a market capitalization-weighted index of 136 stocks
designed to measure the performance of companies in the utilities
sector. Issues in the index include generators and distributors of
electricity, distributors of natural gas and water, and providers of
telecommunications services.
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, a 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.
The money market fund may compare its performance or the performance
of securities in which it may invest to averages published by IBC
Financial Data, Inc. of Ashland, Massachusetts. These averages assume
reinvestment of distributions. IBC's MONEY FUND REPORT
AVERAGES(trademark)/ALL TAXABLE, which is reported in IBC's MONEY FUND
REPORT(trademark), covers over 916 taxable money market funds.
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 stock fund may quote various measures of volatility and
benchmark correlation in advertising. In addition, the 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 price movements over specific periods of
time for a stock fund. Each point on the momentum indicator represents
a fund's percentage change in price movements over that period.
A stock 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 $ 34 billion in
municipal fund assets, $ 127 billion in taxable fixed-income
fund assets, $131 billion in money market fund assets, $501 billion in
equity fund assets, $13 billion in international fund assets, and $32
billion in Spartan fund assets. The funds 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, the money market fund 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
Pursuant to Rule 22d-1 under the 1940 Act, FDC exercises its right to
waive each fund's front-end sales charge on shares acquired through
reinvestment of dividends and capital gain distributions or in
connection with a fund's merger with or acquisition of any investment
company or trust. In addition, FDC has chosen to waive each fund's
front-end sales charge in certain instances due to sales efficiencies
and competitive considerations. The sales charge will not apply:
1. to shares purchased in connection with an employee benefit plan
(including the Fidelity-sponsored 403(b) and corporate IRA programs
but otherwise as defined in the Employee Retirement Income Security
Act) maintained by a U.S. employer and having more than 200 eligible
employees, or a minimum of $3,000,000 in plan assets invested in
Fidelity mutual funds, or as part of an employee benefit plan
maintained by a U.S. employer that is a member of a parent-subsidiary
group of corporations (within the meaning of Section 1563(a)(1) of the
Internal Revenue Code, with "50%" substituted for "80%") any member of
which maintains an employee benefit plan having more than 200 eligible
employees, or a minimum of $3,000,000 in plan assets invested in
Fidelity mutual funds, or as part of an employee benefit plan
maintained by a non-U.S. employer having 200 or more eligible
employees, or a minimum of $3,000,000 in assets invested in Fidelity
mutual funds, the assets of which are held in a bona fide trust for
the exclusive benefit of employees participating therein;
2. to shares purchased by an insurance company separate account used
to fund annuity contracts purchased by employee benefit plans
(including 403(b) programs, but otherwise as defined in the Employee
Retirement Income Security Act), which, in the aggregate, have either
more than 200 eligible employees or a minimum of $3,000,000 in assets
invested in Fidelity funds;
3. to shares in a Fidelity account purchased (including purchases by
exchange) with the proceeds of a distribution from an employee benefit
plan provided that: (i) at the time of the distribution, the employer,
or an affiliate (as described in waiver (1) above) of such employer,
maintained at least one employee benefit plan that qualified for
waiver (1) above and that had at least some portion of its assets
invested in one or more mutual funds advised by FMR, or in one or more
investment accounts or pools advised by Fidelity Management Trust
Company; and (ii) either (a) the distribution is transferred from the
plan to a Fidelity IRA account within 60 days from the date of the
distribution or (b) the distribution is transferred directly from the
plan into another Fidelity account;
4. to shares purchased by a charitable organization (as defined for
purposes of Section 501(c)(3) of the Internal Revenue Code) investing
$100,000 or more;
5. to shares purchased for a charitable remainder trust or life income
pool established for the benefit of a charitable organization (as
defined for purposes of Section 501(c)(3) of the Internal Revenue
Code);
6. to shares purchased by an investor participating in the Fidelity
Trust Portfolios program (these investors must make initial
investments of $100,000 or more in the Trust Portfolios funds and
must, during the initial six-month period, reach and maintain an
aggregate balance of at least $500,000 in all accounts and subaccounts
purchased through the Trust Portfolios program);
7. to shares purchased by a mutual fund or a qualified state tuition
program for which FMR or an affiliate serves as investment manager;
8. to shares purchased through Portfolio Advisory Services SM or
Fidelity Charitable Advisory Services;
9. to shares purchased by a current or former Trustee or officer of a
Fidelity fund or a current or retired officer, director, or regular
employee of FMR Corp. or Fidelity International Limited or their
direct or indirect subsidiaries (a Fidelity Trustee or employee), the
spouse of a Fidelity Trustee or employee, a Fidelity Trustee or
employee acting as custodian for a minor child, or a person acting as
trustee of a trust for the sole benefit of the minor child of a
Fidelity Trustee or employee; or
10. to shares purchased by a bank trust officer, registered
representative, or other employee of a qualified recipient. Qualified
recipients are securities dealers or other entities, including banks
and other financial institutions, who have sold the fund's shares
under special arrangements in connection with FDC's sales activities.
A fund's sales charge may be reduced to reflect sales charges
previously paid, or that would have been paid absent a reduction for
some purchases made directly with Fidelity as noted in the prospectus,
in connection with investments in other Fidelity funds. This includes
reductions for investments in the following prototype or
prototype-like retirement plans sponsored by FMR or FMR Corp.: The
Fidelity Traditional IRA, The Fidelity Roth IRA, The Fidelity Rollover
IRA, The Fidelity SEP-IRA and SARSEP, The Fidelity SIMPLE IRA, The
Fidelity Retirement Plan, Fidelity Defined Benefit Plan, The Fidelity
Group IRA, The Fidelity 403(b) Program, The Fidelity Investments
401(a) Prototype Plan for Tax-Exempt Employers, and The CORPORATEplan
for Retirement (Profit Sharing and Money Purchase Plan).
On October 12, 1990, the funds changed their sales charge policy from
a 2% sales charge upon purchase and a 1% deferred sales charge upon
redemption, to a 3% sales charge upon purchase. If you purchased your
shares prior to that date, when you redeem those shares a trading fee
will be deducted and a deferred sales charge of 1% of this net
redemption amount will be deducted. The deferred sales charge does not
apply to exchanges between Select funds.
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 each 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 each fund's income may qualify for the
dividends-received deduction available to corporate shareholders to
the extent that the fund's income is derived from qualifying
dividends. Because each fund may earn other types of income, such as
interest, short-term capital gains, and non-qualifying dividends, the
percentage of dividends from the fund that qualifies for the deduction
generally will be less than 100%. A portion of each fund's dividends
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. Each fund's long-term capital gains
distributions are federally taxable to shareholders generally as
capital gains. The money market fund may distribute any net realized
capital gains once a year or more often, as necessary.
As of February 28, 1999, Automotive had a capital loss
carryforward aggregating approximately $ 1,009,000 . This loss
carryforward, all of which will expire on February 28,
2007 , is available to offset future capital gains.
As of February 28 , 1999, Electronics had a capital loss
carryforward aggregating approximately $102,009,000. This loss
carryforward, all of which will expire on February 28 , 2007, is
available to offset future capital gains.
As of February 28 , 1999, Energy had a capital loss
carryforward aggregating approximately $3,040,000. This loss
carryforward, all of which will expire on February 28 , 2007, is
available to offset future capital gains.
As of February 28 , 1999, Energy Services had a capital loss
carryforward aggregating approximately $85,150,000. This loss
carryforward, all of which will expire on February 28 , 2007, is
available to offset future capital gains.
As of February 28 , 1999, Gold had a capital loss
carryforward aggregating approximately $52,460,000. This loss
carryforward, of which $35,849,000 and $16,611,000, will expire on
February 28 , 2006 and 2007, respectively, is available to
offset future capital gains.
As of February 28 , 1999, Industrial Materials had a capital
loss carryforward aggregating approximately $840,000. This loss
carryforward, all of which will expire on February 28 , 2007, is
available to offset future capital gains.
As of February 28 , 1999, Medical Delivery had a capital loss
carryforward aggregating approximately $10,988,000. This loss
carryforward, all of which will expire on February 28 , 2007, is
available to offset future capital gains.
As of February 28 , 1999, Natural Gas had a capital loss
carryforward aggregating approximately $3,229,000. This loss
carryforward, all of which will expire on February 28 , 2007, is
available to offset future capital gains.
As of February 28 , 1999, Natural Resources had a capital
loss carryforward aggregating approximately $563,000. This loss
carryforward, all of which will expire on February 28 , 2007, is
available to offset future capital gains.
As of February 28 , 1999, Paper and Forest Products had a
capital loss carryforward aggregating approximately $2,903,000. This
loss carryforward, all of which will expire on February 28 ,
2007, is available to offset future capital gains.
As of February 28 , 1999, Precious Metals and Minerals had a
capital loss carryforward aggregating approximately $77,793,000. This
loss carryforward, of which $1,376,000, $55,694,000, and $20,723,000,
will expire on February 28 , 2001, 2006, and 2007, respectively,
is available to offset future capital gains.
RETURNS OF CAPITAL. If a 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.
FOREIGN TAX CREDIT OR DEDUCTION. Foreign governments may withhold
taxes on dividends and interest earned by a fund with respect to
foreign securities. Foreign governments may also impose taxes on other
payments or gains with respect to foreign securities. If, at the close
of its fiscal year, more than 50% of a fund's total assets is invested
in securities of foreign issuers, the fund may elect to pass through
eligible foreign taxes paid and thereby allow shareholders to take a
deduction or, if they meet certain holding period requirements with
respect to fund shares, a credit on their individual tax returns.
TAX STATUS OF THE FUNDS. Each fund 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, each fund 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 each fund 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 a 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 a fund is suitable to their particular tax
situation.
TRUSTEES AND OFFICERS
The Trustees, Members of the Advisory Board, and executive officers of
the trust are listed below. The Board of Trustees governs each fund
and is responsible for protecting the interests of shareholders. The
Trustees are experienced executives who meet periodically throughout
the year to oversee each fund's activities, review contractual
arrangements with companies that provide services to each fund, and
review each fund'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 and Members of the
Advisory Board also serve in similar capacities for other funds
advised by FMR or its affiliates. The business address of each
Trustee, Member of the Advisory Board, 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 either the trust 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. ; and a Director of FDC. Abigail Johnson,
Member of the Advisory Board of Fidelity Select Portfolios, is Mr.
Johnson's daughter.
ABIGAIL P. JOHNSON (37), Member of the Advisory Board of Fidelity
Select Portfolios (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 (65), 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 (66), 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 Director of General Re Corporation
(reinsurance , 1987-1998 ), and Valuation Research Corp.
(appraisals and valuations, 1993-1995). H e 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).
BOYCE I. GREER (43), is Vice President of Money Market Funds (1997),
Group Leader of the Money Market Group (1997), Senior Vice President
of FMR (1997), and Vice President of FIMM (1998). Mr. Greer served as
the Leader of the Fixed-Income Group for Fidelity Management Trust
Company (1993-1995) and was Vice President and Group Leader of
Municipal Fixed-Income Investments (1996-1997).
FRED L. HENNING, JR. (59), is Vice President of Fidelity's
Fixed-Income Group (1995), Senior Vice President of FMR (1995), and
Senior Vice President of FIMM (1998). Before assuming his current
responsibilities, Mr. Henning was head of Fidelity's Money Market
Division.
JOHN T. TODD (50), is Vice President of Select Money Market Portfolio
(1996), and other funds advised by FMR. Prior to his current
responsibilities, Mr. Todd has managed a variety of Fidelity funds.
ERIC D. ROITER (50), Secretary (1998), is Vice President (1998) and
General Counsel of FMR (1998) and Vice President and Clerk of FDC
(1998). Prior to joining Fidelity, Mr. Roiter was with the law
firm of Debevoise & Plimpton , as an associate (1981-1984) and
as a partner (1985-1997), and served as an Assistant General
Counsel of the U.S. Securities and Exchange Commission (1979-1981).
Mr. Roiter was an Adjunct Member, Faculty of Law, at Columbia
University Law School (1996-1997).
RICHARD A. SILVER (51), 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).
STANLEY N. GRIFFITH (52), Assistant Vice President (1998), is
Assistant Vice President of Fidelity's Fixed-Income Funds (1998) and
an employee of FMR Corp.
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).
THOMAS J. SIMPSON (40), Assistant Treasurer (1996), is Assistant
Treasurer of Fidelity's Fixed-Income Funds (1998) and an employee of
FMR (1996). Prior to joining FMR, Mr. Simpson was Vice President and
Fund Controller of Liberty Investment Services (1987-1995).
The following table sets forth information describing the compensation
of each Trustee and Member of the Advisory Board of each 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> <C> <C>
Compensation Table
AGGREGATE COMPENSATION FROM A Edward C. Johnson 3d** Abigail P. Johnson** J. Gary Burkhead ** Ralph F. Cox
FUNDA
Air TransportationB $ 0 $ 0 $ 0 $ 36
AutomotiveB $ 0 $ 0 $ 0 $ 20
BiotechnologyB $ 0 $ 0 $ 0 $ 194
Brokerage and Investment $ 0 $ 0 $ 0 $ 252
ManagementB
Business Services and $ 0 $ 0 $ 0 $ 17
OutsourcingB
ChemicalsB $ 0 $ 0 $ 0 $ 17
ComputersB $ 0 $ 0 $ 0 $ 316
Construction and HousingB $ 0 $ 0 $ 0 $ 28
Consumer IndustriesB $ 0 $ 0 $ 0 $ 26
Cyclical IndustriesB $ 0 $ 0 $ 0 $ 1
Defense and AerospaceB $ 0 $ 0 $ 0 $ 20
Developing CommunicationsB $ 0 $ 0 $ 0 $ 96
ElectronicsB $ 0 $ 0 $ 0 $ 761
EnergyB $ 0 $ 0 $ 0 $ 49
Energy ServiceB $ 0 $ 0 $ 0 $ 241
Environmental ServicesB $ 0 $ 0 $ 0 $ 7
Financial ServicesB $ 0 $ 0 $ 0 $ 216
Food and AgricultureB $ 0 $ 0 $ 0 $ 80
GoldB $ 0 $ 0 $ 0 $ 73
Health CareB,C,D $ 0 $ 0 $ 0 $ 843
Home FinanceB $ 0 $ 0 $ 0 $ 487
Industrial EquipmentB $ 0 $ 0 $ 0 $ 15
Industrial MaterialsB $ 0 $ 0 $ 0 $ 6
InsuranceB $ 0 $ 0 $ 0 $ 39
LeisureB $ 0 $ 0 $ 0 $ 98
Medical DeliveryB $ 0 $ 0 $ 0 $ 55
Medical Equipment and SystemsB+ $ 0 $ 0 $ 0 $ 5
MultimediaB $ 0 $ 0 $ 0 $ 44
Natural GasB $ 0 $ 0 $ 0 $ 18
Natural ResourcesB $ 0 $ 0 $ 0 $ 2
Paper and Forest ProductsB $ 0 $ 0 $ 0 $ 6
Precious Metals and MineralsB $ 0 $ 0 $ 0 $ 53
Regional BanksB $ 0 $ 0 $ 0 $ 439
RetailingB $ 0 $ 0 $ 0 $ 91
Software and Computer ServicesB $ 0 $ 0 $ 0 $ 191
TechnologyB $ 0 $ 0 $ 0 $ 240
TelecommunicationsB $ 0 $ 0 $ 0 $ 263
TransportationB $ 0 $ 0 $ 0 $ 10
Utilities GrowthB $ 0 $ 0 $ 0 $ 138
Money MarketB $ 0 $ 0 $ 0 $ 326
TOTAL COMPENSATION FROM THE $ 0 $ 0 $ 0 $ 223,500
FUND COMPLEX*,A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
AGGREGATE COMPENSATION
FROM A Phyllis Burke Davis Robert M. Gates E. Bradley Jones Donald J. Kirk Peter S. Lynch**
FUNDA
Air TransportationB $ 36 $ 36 $ 36 $ 36 $ 0
AutomotiveB $ 19 $ 20 $ 19 $ 20 $ 0
BiotechnologyB $ 191 $ 193 $ 192 $ 194 $ 0
Brokerage and Investment $ 248 $ 253 $ 251 $ 255 $ 0
ManagementB
Business Services and $ 17 $ 17 $ 17 $ 18 $ 0
OutsourcingB
ChemicalsB $ 17 $ 17 $ 17 $ 17 $ 0
ComputersB $ 311 $ 315 $ 313 $ 315 $ 0
Construction and HousingB $ 27 $ 28 $ 27 $ 28 $ 0
Consumer IndustriesB $ 26 $ 26 $ 26 $ 27 $ 0
Cyclical IndustriesB $ 1 $ 1 $ 1 $ 1 $ 0
Defense and AerospaceB $ 20 $ 20 $ 20 $ 20 $ 0
Developing CommunicationsB $ 94 $ 96 $ 95 $ 96 $ 0
ElectronicsB $ 751 $ 761 $ 756 $ 763 $ 0
EnergyB $ 49 $ 49 $ 49 $ 50 $ 0
Energy ServiceB $ 238 $ 242 $ 240 $ 243 $ 0
Environmental ServicesB $ 7 $ 7 $ 7 $ 7 $ 0
Financial ServicesB $ 213 $ 216 $ 214 $ 218 $ 0
Food and AgricultureB $ 79 $ 80 $ 79 $ 80 $ 0
GoldB $ 72 $ 72 $ 72 $ 73 $ 0
Health CareB,C,D $ 832 $ 842 $ 837 $ 848 $ 0
Home FinanceB $ 481 $ 488 $ 485 $ 493 $ 0
Industrial EquipmentB $ 15 $ 15 $ 15 $ 15 $ 0
Industrial MaterialsB $ 6 $ 6 $ 6 $ 6 $ 0
InsuranceB $ 38 $ 39 $ 39 $ 39 $ 0
LeisureB $ 96 $ 98 $ 97 $ 99 $ 0
Medical DeliveryB $ 54 $ 55 $ 55 $ 56 $ 0
Medical Equipment and
SystemsB+ $ 5 $ 5 $ 5 $ 5 $ 0
MultimediaB $ 43 $ 44 $ 43 $ 44 $ 0
Natural GasB $ 18 $ 18 $ 18 $ 19 $ 0
Natural ResourcesB $ 2 $ 2 $ 2 $ 2 $ 0
Paper and Forest ProductsB $ 6 $ 6 $ 6 $ 6 $ 0
Precious Metals and MineralsB $ 52 $ 53 $ 53 $ 53 $ 0
Regional BanksB $ 433 $ 440 $ 437 $ 443 $ 0
RetailingB $ 90 $ 91 $ 91 $ 92 $ 0
Software and Computer
ServicesB $ 188 $ 191 $ 189 $ 192 $ 0
TechnologyB $ 237 $ 240 $ 239 $ 240 $ 0
TelecommunicationsB $ 259 $ 263 $ 261 $ 265 $ 0
TransportationB $ 10 $ 10 $ 10 $ 10 $ 0
Utilities GrowthB $ 136 $ 138 $ 137 $ 138 $ 0
Money MarketB $ 322 $ 326 $ 323 $ 330 $ 0
TOTAL COMPENSATION FROM THE $ 220,500 $ 223,500 $222,000 $ 226,500 $ 0
FUND COMPLEX*,A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
AGGREGATE COMPENSATION
FROM A William O. McCoy Gerald C. McDonough Marvin L. Mann Robert C. Pozen ** Thomas R. Williams
FUNDA
Air TransportationB $ 36 $ 44 $ 36 $ 0 $ 36
AutomotiveB $ 20 $ 24 $ 20 $ 0 $ 20
BiotechnologyB $ 193 $ 237 $ 193 $ 0 $ 193
Brokerage and Investment $ 253 $ 309 $ 253 $ 0 $ 253
ManagementB
Business Services and $ 17 $ 21 $ 17 $ 0 $ 17
OutsourcingB
ChemicalsB $ 17 $ 21 $ 17 $ 0 $ 17
ComputersB $ 315 $ 385 $ 315 $ 0 $ 315
Construction and HousingB $ 28 $ 34 $ 28 $ 0 $ 28
Consumer IndustriesB $ 26 $ 32 $ 26 $ 0 $ 26
Cyclical IndustriesB $ 1 $ 2 $ 1 $ 0 $ 1
Defense and AerospaceB $ 20 $ 25 $ 20 $ 0 $ 20
Developing CommunicationsB $ 96 $ 117 $ 96 $ 0 $ 96
ElectronicsB $ 761 $ 931 $ 761 $ 0 $ 761
EnergyB $ 49 $ 60 $ 49 $ 0 $ 49
Energy ServiceB $ 242 $ 296 $ 242 $ 0 $ 242
Environmental ServicesB $ 7 $ 9 $ 7 $ 0 $ 7
Financial ServicesB $ 216 $ 264 $ 216 $ 0 $ 216
Food and AgricultureB $ 80 $ 98 $ 80 $ 0 $ 80
GoldB $ 72 $ 89 $ 72 $ 0 $ 72
Health CareB,C,D $ 842 $ 1,031 $ 842 $ 0 $ 842
Home FinanceB $ 488 $ 598 $ 488 $ 0 $ 488
Industrial EquipmentB $ 15 $ 18 $ 15 $ 0 $ 15
Industrial MaterialsB $ 6 $ 7 $ 6 $ 0 $ 6
InsuranceB $ 39 $ 48 $ 39 $ 0 $ 39
LeisureB $ 98 $ 120 $ 98 $ 0 $ 98
Medical DeliveryB $ 55 $ 67 $ 55 $ 0 $ 55
Medical Equipment and
SystemsB+ $ 5 $ 6 $ 5 $ 0 $ 5
MultimediaB $ 44 $ 54 $ 44 $ 0 $ 44
Natural GasB $ 18 $ 23 $ 18 $ 0 $ 18
Natural ResourcesB $ 2 $ 3 $ 2 $ 0 $ 2
Paper and Forest ProductsB $ 6 $ 8 $ 6 $ 0 $ 6
Precious Metals and
MineralsB $ 53 $ 65 $ 53 $ 0 $ 53
Regional BanksB $ 440 $ 539 $ 440 $ 0 $ 440
RetailingB $ 91 $ 112 $ 91 $ 0 $ 91
Software and Computer
ServicesB $ 191 $ 233 $ 191 $ 0 $ 191
TechnologyB $ 240 $ 294 $ 240 $ 0 $ 240
TelecommunicationsB $ 263 $ 322 $ 263 $ 0 $ 263
TransportationB $ 10 $ 12 $ 10 $ 0 $ 10
Utilities GrowthB $ 138 $ 169 $ 138 $ 0 $ 138
Money MarketB $ 326 $ 396 $ 326 $ 0 $ 326
TOTAL COMPENSATION FROM
THE $ 223,500 $ 273,500 $ 220,500 $ 0 $ 223,500
FUND COMPLEX*,A
</TABLE>
* Information is for the calendar year ended December 31, 1998 for 237
funds in the complex.
** Interested Trustees of the funds , 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, $ 379 ; Phyllis Burke
Davis, $ 379 ; Robert M. Gates, $ 379 ; E. Bradley Jones,
$ 379 ; Donald J. Kirk, $ 379 ; William O. McCoy,
$ 379 ; Gerald C. McDonough, $ 443 ; Marvin L. Mann,
$ 379 ; and Thomas R. Williams, $ 379 .
D Certain of the non-interested Trustees' aggregate
compensation from a fund includes accrued voluntary deferred
compensation as follows: Ralph F. Cox, $321, Health Care; William
O. McCoy, $321, Health Care; Marvin L. Mann, $263, Health Care; and
Thomas R. Williams, $321, Health Care.
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 February 28, 1999, approximately 15.71% and 38.73% of Natural
Resources' and Cyclical Industries' total outstanding shares
w ere held by an FMR affiliate. FMR Corp. is the ultimate parent
company of FMR this FMR affiliate. By virtue of his ownership interest
in FMR Corp., as described in the "Control of Investment Advisers"
section on page 355 , Mr. Edward C. Johnson 3d, President and
Trustee of the fund, may be deemed to be a beneficial owner of these
shares. As of the above date, with the exception of Mr. Johnson 3d's
deemed ownership of Natural Resources' and Cyclical Industries'
shares, the Trustees, Members of the Advisory Board, and officers of
the funds owned, in the aggregate, less than 1 % of each fund's
total outstanding shares.
As of February 28, 1999, the following owned of record or beneficially
5% or more (up to and including 25%) of each fund's outstanding
shares:
Air Transportation: First Trust Corporation, Denver, CO (5.80%)
Energy: Boston College, Boston, MA (5.64%)
Natural Resources: FMR Capital, Boston, MA (15.71%)
As of February 28, 1999, approximately 38.73 % of Cyclical
Industries' total outstanding shares were held by FMR Capital,
Boston, Massachusetts.
A shareholder owning of record or beneficially more than 25% of a
fund's outstanding shares may be considered a controlling person. That
shareholder's vote could have a more significant effect on matters
presented at a shareholders' meeting than votes of other shareholders.
CONTROL OF INVESTMENT ADVISERS
FMR Corp., organized in 1972, is the ultimate parent company of FMR,
FIMM, FMR U.K. and FMR Far East. 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 Investment Company Act of 1940 (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 CONTRACTS
Each fund has entered into a management contract with FMR, pursuant to
which FMR furnishes investment advisory and other services.
MANAGEMENT SERVICES. Under the terms of its management contract with
each fund, FMR 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. FMR also provides each fund with all necessary office
facilities and personnel for servicing the fund's investments,
compensates all officers of each fund and all Trustees who are
"interested persons" of the trust or of FMR, and all personnel of each
fund or FMR performing services relating to research, statistical and
investment activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provide the management and administrative services
necessary for the operation of each fund. These services include
providing facilities for maintaining each fund's organization;
supervising relations with custodians, transfer and pricing agents,
accountants, underwriters and other persons dealing with each fund;
preparing all general shareholder communications and conducting
shareholder relations; maintaining each fund's records and the
registration of each fund's shares under federal securities laws and
making necessary filings under state securities laws; developing
management and shareholder services for each fund; and furnishing
reports, evaluations and analyses on a variety of subjects to the
Trustees.
MANAGEMENT-RELATED EXPENSES. In addition to the management fee payable
to FMR and the fees payable to the transfer, dividend disbursing, and
shareholder servicing agent, pricing and bookkeeping agent, and
securities lending agent, as applicable, each fund pays all of its
expenses that are not assumed by those parties. Each fund pays for the
typesetting, printing, and mailing of its proxy materials to
shareholders, legal expenses, and the fees of the custodian, auditor
and non-interested Trustees. Each fund's management contract further
provides that the fund will pay for typesetting, printing, and mailing
prospectuses, statements of additional information, notices, and
reports to shareholders; however, under the terms of each fund's
transfer agent agreement, the transfer agent bears the costs of
providing these services to existing shareholders. Other expenses paid
by each fund include interest, taxes, brokerage commissions, the
fund's proportionate share of insurance premiums and Investment
Company Institute dues, and the costs of registering shares under
federal securities laws and making necessary filings under state
securities laws. Each fund is also liable for such non-recurring
expenses as may arise, including costs of any litigation to which the
fund may be a party, and any obligation it may have to indemnify its
officers and Trustees with respect to litigation.
MANAGEMENT FEES. For the services of FMR under the management
contract, the money market fund pays FMR a monthly management fee
which has three components: a group fee rate, an individual fund fee
rate, and an income-based component of 6% of the fund's monthly gross
income in excess of an annualized 5% yield. For this purpose, gross
income includes interest accrued and/or discount earned (including
both original issue discount and market discount) on portfolio
obligations, less amortization of premium on portfolio obligations.
The maximum income-based component is an amount equal to an annual
rate of 0.24% of the fund's average net assets throughout the month.
The group fee rate is based on the monthly average net assets of
all of the registered investment companies with which FMR has
management contracts.
The following is the fee schedule for the money market fund.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MONEY MARKET FUND
Group Fee Rate Schedule Effective Annual Fee Rates
Average Group Assets Annualized Rate Group Net Assets Effective Annual Fee Rate
0 - $3 billion .3700% $ 0.5 billion .3700%
3 - 6 .3400 25 .2664
6 - 9 .3100 50 .2188
9 - 12 .2800 75 .1986
12 - 15 .2500 100 .1869
15 - 18 .2200 125 .1793
18 - 21 .2000 150 .1736
21 - 24 .1900 175 .1690
24 - 30 .1800 200 .1652
30 - 36 .1750 225 .1618
36 - 42 .1700 250 .1587
42 - 48 .1650 275 .1560
48 - 66 .1600 300 .1536
66 - 84 .1550 325 .1514
84 - 120 .1500 350 .1494
120 - 156 .1450 375 .1476
156 - 192 .1400 400 .1459
192 - 228 .1350 425 .1443
228 - 264 .1300 450 .1427
264 - 300 .1275 475 .1413
300 - 336 .1250 500 .1399
336 - 372 .1225 525 .1385
372 - 408 .1200 550 .1372
408 - 444 .1175
444 - 480 .1150
480 - 516 .1125
Over 516 .1100
</TABLE>
The group fee rate is calculated on a cumulative basis pursuant to
the graduated fee rate schedule shown above on the left. The schedule
above on the right shows the effective annual group fee rate at
various asset levels, which is the result of cumulatively applying the
annualized rates on the left. For example, the effective annual fee
rate at $707 billion of group net assets - the approximate level for
February 1999 - was 0.1312%, which is the weighted average of the
respective fee rates for each level of group net assets up to $707
billion.
The money market fund's individual fund fee rate is 0.03%.
One-twelfth of the sum of the group fee rate and the individual fund
fee rate is applied to the fund's average net assets for the month,
giving a dollar amount which is the fee for that month to which the
income-based component is added.
For the services of FMR under the management contract, each stock
fund pays FMR a monthly management fee which has two components: a
group fee rate and an individual fund fee rate.
The following is the fee schedule for the stock funds.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
STOCK FUNDS
Group Fee Rate SchedulE Effective Annual Fee RateS
Average Group Assets Annualized Rate Group Net Assets Effective Annual Fee Rate
0 - $3 billion .5200% $ 0.5 billion .5200%
3 - 6 .4900 25 .4238
6 - 9 .4600 50 .3823
9 - 12 .4300 75 .3626
12 - 15 .4000 100 .3512
15 - 18 .3850 125 .3430
18 - 21 .3700 150 .3371
21 - 24 .3600 175 .3325
24 - 30 .3500 200 .3284
30 - 36 .3450 225 .3249
36 - 42 .3400 250 .3219
42 - 48 .3350 275 .3190
48 - 66 .3250 300 .3163
66 - 84 .3200 325 .3137
84 - 102 .3150 350 .3113
102 - 138 .3100 375 .3090
138 - 174 .3050 400 .3067
174 - 210 .3000 425 .3046
210 - 246 .2950 450 .3024
246 - 282 .2900 475 .3003
282 - 318 .2850 500 .2982
318 - 354 .2800 525 .2962
354 - 390 .2750 550 .2942
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over 534 .2500
</TABLE>
The group fee rate is calculated on a cumulative basis pursuant to the
graduated fee rate schedule shown above on the left. The schedule
above on the right shows the effective annual group fee rate at
various asset levels, which is the result of cumulatively applying the
annualized rates on the left. For example, the effective annual fee
rate at $ 707 billion of group net assets - the approximate
level for February 1999 - was 0.2843 %, which is the weighted
average of the respective fee rates for each level of group net assets
up to $ 707 billion.
Each stock fund's individual fund fee rate is 0.30%. Based on the
average group net assets of the funds advised by FMR for February
1999, each stock fund's annual management fee rate would be calculated
as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Group Fee Rate Individual Fund Fee Rate Management Fee Rate
Stock Funds 0.2843% + 0.30% = 0.5843%
</TABLE>
One-twelfth of the management fee rate is applied to each stock fund's
average net assets for the month, giving a dollar amount which is the
fee for that month.
The following table shows the amount of management fees paid by each
fund to FMR for the past three fiscal years.
<TABLE>
<CAPTION>
<S> <C> <C>
Fund Fiscal Years Ended February 28 Management Fees Paid to FMR
Air Transportation 1999 $ 573,138
1998 $ 378,349
1997 $ 539,940
Automotive 1999 $ 357,296
1998 $ 369,375
1997 $ 726,743
Biotechnology 1999 $ 3,390,377
1998 $ 3,442,469
1997 $ 4,324,960
Brokerage and Investment 1999 $ 4,267,725
Management
1998 $ 2,493,991
1997 $ 448,938
Business Services and 1999 $ 326,653
Outsourcing
1998* $ 2,948
Chemicals 1999 $ 276,652
1998 $ 496,851
1997 $ 745,680
Computers 1999 $ 6,013,190
1998 $ 3,921,116
1997 $ 3,309,228
Construction and Housing 1999 $ 490,439
1998 $ 155,730
1997 $ 408,988
Consumer Industries 1999 $ 457,965
1998 $ 161,119
1997 $ 154,434
Cyclical Industries 1999 $ 22,236
1998** $ 21,141
Defense and Aerospace 1999 $ 312,058
1998 $ 381,060
1997 $ 268,010
Developing Communications 1999 $ 1,854,817
1998 $ 1,420,790
1997 $ 1,856,888
Electronics 1999 $ 13,375,808
1998 $ 14,146,742
1997 $ 7,859,173
Energy 1999 $ 825,294
1998 $ 1,137,325
1997 $ 1,066,783
Energy Service 1999 $ 3,826,822
1998 $ 5,735,646
1997 $ 2,790,650
Environmental Services 1999 $ 122,145
1998 $ 165,498
1997 $ 252,081
Fund Fiscal Years Ended February 28 Management Fees Paid to FMR
Financial Services 1999 $ 3,668,034
1998 $ 2,799,557
1997 $ 1,661,452
Food and Agriculture 1999 $ 1,335,082
1998 $ 1,473,308
1997 $ 1,682,437
Gold 1999 $ 1,216,228
1998 $ 1,664,398
1997 $ 2,501,556
Health Care 1999 $ 14,851,440
1998 $ 9,512,189
1997 $ 7,661,331
Home Finance 1999 $ 7,895,622
1998 $ 7,971,664
1997 $ 4,201,147
Industrial Equipment 1999 $ 249,535
1998 $ 358,194
1997 $ 560,442
Industrial Materials 1999 $ 94,263
1998 $ 178,398
1997 $ 590,927
Insurance 1999 $ 645,431
1998 $ 657,447
1997 $ 204,881
Leisure 1999 $ 1,721,162
1998 $ 853,326
1997 $ 643,761
Medical Delivery 1999 $ 909,497
1998 $ 949,169
1997 $ 1,307,251
Medical Equipment and Systems 1999*** $ 80,475
Multimedia 1999 $ 768,461
1998 $ 355,794
1997 $ 513,562
Natural Gas 1999 $ 301,788
1998 $ 489,011
1997 $ 679,330
Natural Resources 1999 $ 38,307
1998** $ 38,241
Paper and Forest Products 1999 $ 87,942
1998 $ 144,890
1997 $ 194,763
Precious Metals and Minerals 1999 $ 882,668
1998 $ 1,160,570
1997 $ 2,005,219
Regional Banks 1999 $ 7,314,180
1998 $ 6,188,500
1997 $ 2,534,699
Fund Fiscal Years Ended February 28 Management Fees Paid to FMR
Retailing 1999 $ 1,658,052
1998 $ 911,425
1997 $ 1,338,783
Software and Computer Services 1999 $ 3,378,317
1998 $ 2,593,824
1997 $ 2,546,782
Technology 1999 $ 4,515,599
1998 $ 3,293,787
1997 $ 2,800,144
Telecommunications 1999 $ 4,615,660
1998 $ 2,473,329
1997 $ 2,878,937
Transportation 1999 $ 142,306
1998 $ 341,054
1997 $ 50,368
Utilities Growth 1999 $ 2,410,584
1998 $ 1,639,699
1997 $ 1,440,039
Money Market 1999 $ 1,853,858
1998 $ 1,715,272
1997 $ 1,584,080
</TABLE>
* Business Services and Outsourcing commenced operations of February
4, 1998.
** Cyclical Industries and Natural Resources commenced operations on
March 3, 1997.
*** Medical Equipment and Systems commenced operations on April 28,
1998.
FMR may, from time to time, voluntarily reimburse all or a portion of
a fund's operating expenses (exclusive of interest, taxes,
securities lending fees, brokerage commissions, and
extraordinary expenses) which is subject to revision or termination.
FMR 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 FMR will increase a fund's returns and
yield, and repayment of the reimbursement by a fund will lower its
returns and yield.
During the past three fiscal periods, FMR voluntarily agreed to
reimburse the funds if and to the extent that the fund's aggregate
operating expenses, including management fees, were in excess of an
annual rate of its average net assets. The table below shows the
dollar amount of management fees incurred under each applicable
fund's contract before reimbursement; and the dollar amount of
management fees reimbursed by FMR under the expense reimbursement for
each period.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Name of Fund Aggregate Operating Expense Fiscal Years Ended February 28 Management Fee Before
Limitation Reimbursement
Construction and Housing 2.50% 1998 $ 155,730
Cyclical Industries 2.50% 1999 $ 22,236
1998 $ 21,141
Natural Resources 2.50% 1999 $ 38,307
1998 $ 38,241
Business Services and 2.50% 1998 $ 2,948
Outsourcing
Transportation 2.50% 1997 $ 75,979
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Name of Fund Amount of Management Fee
Reimbursement
Construction and Housing $ 9,992
Cyclical Industries $ 22,236
$ 21,141
Natural Resources $ 38,307
$ 38,241
Business Services and $ 2,948
Outsourcing
Transportation $ 25,611
</TABLE>
SUB-ADVISER. On behalf of the money market fund, FMR has entered into
a sub-advisory agreement with FIMM pursuant to which FIMM has primary
responsibility for choosing investments for the fund. Prior to
January 23, 1998, FMR Texas Inc. (FMR Texas) had primary
responsibility for providing investment management services to the
fund. On January 23, 1998, FMR Texas was merged into FIMM, which
succeeded to the operations of FMR Texas.
Under the terms of the sub-advisory agreement for the money market
fund, FMR pays FIMM fees equal to 50% of the management fee payable to
FMR under its management contract with the fund. The fees paid to FIMM
are not reduced by any voluntary or mandatory expense reimbursements
that may be in effect from time to time.
On behalf of the money market fund, for the fiscal years ended
February 28, 1998 and 1997, FMR paid FMR Texas fees of $857,636 and
$792,040, respectively. On behalf of the money market fund, for the
fiscal year ended February 28, 1999, FMR paid FIMM fees of
$ 926,930.
On behalf of the stock funds, FMR has entered into subadvisory
agreements with FMR U.K. and FMR Far East. Pursuant to the
sub-advisory agreements, FMR may receive investment advice and
research services outside the United States from the sub-advisers.
On behalf of the stock funds, FMR may also grant FMR U.K. and FMR Far
East investment management authority as well as the authority to buy
and sell securities if FMR believes it would be beneficial to the
funds.
Under the sub-advisory agreements FMR pays the fees of FMR U.K. and
FMR Far East. For providing non-discretionary investment advice and
research services, FMR pays FMR U.K. and FMR Far East fees equal to
110% and 105%, respectively, of FMR U.K.'s and FMR Far East's costs
incurred in connection with providing investment advice and research
services.
On behalf of the stock funds, for providing discretionary investment
management and executing portfolio transactions, FMR pays FMR U.K. and
FMR Far East a fee equal to 50% of its monthly management fee rate
with respect to each fund's average net assets managed by the
sub-adviser on a discretionary basis.
For providing investment advice and research services, fees paid to
FMR U.K. and FMR Far East on behalf of the stock funds for the past
three fiscal years are shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
FEES PAID BY FMR TO FOREIGN SUB-ADVISERS
Fund FEES PAID BY FMR TO FMR U.K. FEES PAID BY FMR TO FMR FAR EAST
1999 1998 1997 1999 1998 1997
Air Transportation $ 2,553 $ 3,327 $ 1,385 $ 2,411 $ 3,202 $ 1,429
Automotive 6,503 4,434 16,190 5,175 4,325 14,746
Biotechnology 5,639 11,836 57,555 4,245 10,833 55,421
Brokerage and Investment 35,636 13,584 1,593 31,379 13,185 1,549
Management
Business Services and 65 6* -- 48 5* --
Outsourcing
Chemicals 1,562 5,873 11,460 1,516 5,590 11,730
Computers 17,784 15,517 14,494 13,154 15,486 14,124
Construction and Housing 583 6 463 525 5 439
Consumer Industries 1,246 474 190 1,024 455 189
Cyclical Industries 13 40** -- 9 40** --
Defense and Aerospace 0 1,692 928 0 1,755 853
Developing Communications 40,270 19,094 16,341 32,779 18,708 15,580
Electronics 82,887 147,596 26,600 72,615 143,650 22,356
Energy 22,599 25,414 27,154 18,894 24,716 25,283
Energy Service 40,212 51,145 26,346 35,640 49,720 25,339
Environmental Services 17 2,414 1,352 19 2,242 1,317
Financial Services 4,454 439 0 3,790 424 0
Food and Agriculture 18,053 5,707 1,856 15,039 5,521 1,799
Gold 20,125 -- -- 15,199 -- --
Health Care 97,086 96,459 140,931 78,047 95,116 132,786
Home Finance 9,249 14,065 13,987 9,829 13,533 12,464
Industrial Equipment 590 736 1,764 533 746 1,518
Industrial Materials 35 1,579 12,985 35 1,540 12,586
Insurance 917 770 153 879 746 146
Leisure 7,018 1,740 2,080 5,868 1,685 1,990
Medical Delivery 0 216 741 0 187 642
Medical Equipment and Systems 73*** -- -- 63*** -- --
Multimedia 1,632 711 3,001 1,301 694 2,963
Natural Gas 1,450 182 786 1,150 154 660
Natural Resources 1,041 559** -- 851 554** --
Paper and Forest Products 1,858 809 1,218 1,762 772 1,118
Precious Metals and Minerals 48,237 42,196 104,793 39,878 40,224 101,856
Regional Banks 3,255 6,772 2,772 3,095 6,544 2,458
Retailing 0 0 1,846 0 0 1,805
Software and Computer Services 14,881 14,371 16,414 13,002 13,791 15,288
Technology 86,248 23,941 16,385 66,343 25,181 14,600
Telecommunications 47,989 37,699 24,984 39,416 36,443 25,546
Transportation 502 571 563 474 575 539
Utilities Growth 3,104 3,855 3,110 2,777 3,672 3,012
</TABLE>
* Business Services and Outsourcing commenced operations of February
4, 1998.
** Cyclical Industries and Natural Resources commenced operations on
March 3, 1997.
*** Medical Equipment and Systems commenced operations on April 28,
1998.
For discretionary investment management and execution of portfolio
transactions, no fees were paid to FMR U.K. and FMR Far East on behalf
of the stock funds for the past three fiscal years.
DISTRIBUTION SERVICES
Each fund has entered into a distribution agreement with FDC, an
affiliate of FMR. FDC is a broker-dealer registered under the
Securities Exchange Act of 1934 and a member of the National
Association of Securities Dealers, Inc. The distribution agreements
call for FDC to use all reasonable efforts, consistent with its other
business, to secure purchasers for shares of the fund, which are
continuously offered. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR.
For fiscal 1997, FDC collected, in the aggregate, $550,208 of deferred
sales charges from the total value of shares redeemed by shareholders
in all funds. On October 12, 1990, the funds' 2.00% sales charge was
increased to 3.00% and the 1.00% deferred sales charge was eliminated.
For fiscal 1997, FDC collected, in the aggregate, $51,023,883 of
front-end sales charges. The following table shows the sales charge
revenue retained by FDC for fiscal 1997.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Fiscal Year Ended Sales Charge Revenue Deferred Sales Charge Revenue
Air Transportation Feb. 28, 1997 $ 668,390 $ 1,386
Automotive Feb. 28, 1997 466,135 2,159
Biotechnology Feb. 28, 1997 1,854,442 41,551
Brokerage and Investment Feb. 28, 1997 903,649 1,311
Management
Chemicals Feb. 28, 1997 579,393 6,478
Computers Feb. 28, 1997 2,540,952 5,155
Construction and Housing Feb. 28, 1997 174,919 1,261
Consumer Industries Feb. 28, 1997 169,639 682
Defense and Aerospace Feb. 28, 1997 292,571 1,408
Developing Communications Feb. 28, 1997 733,692 7,987
Electronics Feb. 28, 1997 9,021,074 9,923
Energy Feb. 28, 1997 1,029,850 14,667
Energy Service Feb. 28, 1997 4,165,989 10,974
Environmental Services Feb. 28, 1997 177,009 9,944
Financial Services Feb. 28, 1997 1,400,884 8,487
Food and Agriculture Feb. 28, 1997 1,095,115 7,683
Gold Feb. 28, 1997 1,162,696 43,678
Health Care Feb. 28, 1997 2,553,184 69,909
Home Finance Feb. 28, 1997 5,869,188 4,653
Industrial Equipment Feb. 28, 1997 252,021 2,660
Industrial Materials Feb. 28, 1997 866,268 4,072
Insurance Feb. 28, 1997 248,750 1,364
Leisure Feb. 28, 1997 282,104 14,717
Medical Delivery Feb. 28, 1997 567,463 6,016
Multimedia Feb. 28, 1997 338,283 4,261
Natural Gas Feb. 28, 1997 682,901 2,332
Paper and Forest Products Feb. 28, 1997 126,407 2,892
Precious Metals and Minerals Feb. 28, 1997 669,762 45,427
Regional Banks Feb. 28, 1997 3,497,512 3,702
Retailing Feb. 28, 1997 838,536 4,812
Software and Computer Services Feb. 28, 1997 1,921,006 5,034
Technology Feb. 28, 1997 1,543,709 36,252
Telecommunications Feb. 28, 1997 1,182,016 30,536
Transportation Feb. 28, 1997 101,332 682
Utilities Growth Feb. 28, 1997 238,618 38,523
Money Market Feb. 28, 1997 2,788,424 97,630
</TABLE>
Sales charge revenues collected and retained by FDC for the fiscal
years 1999 and 1998 are shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Sales Charge Revenue Deferred Sales Charge Revenue
Fiscal Year Ended Amount Paid to FDC Amount Retained by FDC Amount Paid to FDC
Air Transportation Feb. 28, 1999 $ 432,957 $ 423,538 $ 2,545
Feb. 28, 1998 299,325 290,774 946
Automotive Feb. 28, 1999 151,425 151,425 1,131
Feb. 28, 1998 70,085 69,822 597
Biotechnology Feb. 28, 1999 1,182,620 1,176,547 23,624
Feb. 28, 1998 1,105,374 1,099,427 31,256
Brokerage and Investment Feb. 28, 1999 4,817,568 4,806,902 5,812
Management
Feb. 28, 1998 4,327,828 4,314,336 2,431
Business Services and Feb. 28, 1999 661,865 661,865 106
Outsourcing
Feb. 28, 1998* 61,937 61,787 0
Chemicals Feb. 28, 1999 45,096 44,178 7,081
Feb. 28, 1998 84,712 84,544 7,955
Computers Feb. 28, 1999 9,062,985 9,053,383 5,657
Feb. 28, 1998 3,518,068 3,494,034 6,144
Construction and Housing Feb. 28, 1999 451,157 449,854 653
Feb. 28, 1998 257,572 257,391 240
Consumer Industries Feb. 28, 1999 342,823 339,350 208
Feb. 28, 1998 84,756 79,995 805
Cyclical Industries Feb. 28, 1999 16,210 16,210 0
Feb. 28, 1998** 36,552 36,552 0
Defense and Aerospace Feb. 28, 1999 127,643 125,494 824
Feb. 28, 1998 312,026 309,320 1,329
Developing Communications Feb. 28, 1999 1,740,638 1,737,968 3,177
Feb. 28, 1998 479,806 477,848 6,980
Electronics Feb. 28, 1999 7,287,169 7,252,407 10,633
Feb. 28, 1998 20,665,782 20,595,342 10,101
Energy Feb. 28, 1999 570,198 567,585 12,418
Feb. 28, 1998 600,122 592,780 14,514
Energy Service Feb. 28, 1999 3,272,526 3,265,721 9,358
Feb. 28, 1998 10,530,278 10,501,244 11,289
Environmental Services Feb. 28, 1999 29,658 28,390 7,574
Feb. 28, 1998 42,162 42,118 6,428
Financial Services Feb. 28, 1999 2,154,649 2,152,071 13,596
Feb. 28, 1998 2,098,142 2,087,581 8,343
Food and Agriculture Feb. 28, 1999 373,556 371,478 5,955
Feb. 28, 1998 682,877 665,203 5,255
Gold Feb. 28, 1999 691,742 685,928 19,578
Feb. 28, 1998 916,845 902,000 27,084
Health Care Feb. 28, 1999 10,991,959 10,970,853 58,978
Feb. 28, 1998 4,316,495 4,275,358 56,845
Home Finance Feb. 28, 1999 4,255,219 4,241,642 13,199
Feb. 28, 1998 9,770,117 9,751,663 5,349
Industrial Equipment Feb. 28, 1999 25,189 24,472 1,074
Feb. 28, 1998 60,451 60,217 2,151
Industrial Materials Feb. 28, 1999 12,710 12,337 1,065
Feb. 28, 1998 21,426 20,666 2,207
Insurance Feb. 28, 1999 351,928 351,772 1,491
Feb. 28, 1998 686,986 664,282 786
Leisure Feb. 28, 1999 956,242 946,671 10,919
Feb. 28, 1998 457,999 448,102 13,069
Sales Charge Revenue Deferred Sales Charge Revenue
Fiscal Year Ended Amount Paid to FDC Amount Retained by FDC Amount Paid to FDC
Medical Delivery Feb. 28, 1999 $ 324,894 $ 324,831 $ 6,973
Feb. 28, 1998 212,167 208,986 6,095
Medical Equipment and
Systems Feb. 28, 1999*** 283,524 283,524 2,642
Multimedia Feb. 28, 1999 599,274 596,505 1,687
Feb. 28, 1998 304,729 289,533 739
Natural Gas Feb. 28, 1999 123,203 121,320 982
Feb. 28, 1998 288,000 286,855 2,018
Natural Resources Feb. 28, 1999 24,488 24,488 8
Feb. 28, 1998** 81,304 81,304 26
Paper and Forest Products Feb. 28, 1999 45,535 45,535 737
Feb. 28, 1998 82,389 81,018 2,161
Precious Metals and
Minerals Feb. 28, 1999 418,114 414,477 18,943
Feb. 28, 1998 590,860 588,609 30,793
Regional Banks Feb. 28, 1999 3,590,683 3,579,211 8,288
Feb. 28, 1998 7,288,315 7,262,004 4,790
Retailing Feb. 28, 1999 1,568,122 1,565,474 2,870
Feb. 28, 1998 622,003 618,590 2,757
Software and Computer
Services Feb. 28, 1999 1,939,605 1,925,580 4,793
Feb. 28, 1998 1,272,908 1,258,051 5,910
Technology Feb. 28, 1999 5,573,254 5,562,533 32,321
Feb. 28, 1998 2,082,341 2,072,865 22,926
Telecommunications Feb. 28, 1999 3,594,841 3,578,078 12,323
Feb. 28, 1998 1,091,356 1,084,052 16,675
Transportation Feb. 28, 1999 94,851 93,190 657
Feb. 28, 1998 168,254 167,042 925
Utilities Growth Feb. 28, 1999 1,250,178 1,246,320 21,580
Feb. 28, 1998 629,220 601,884 22,382
Money Market Feb. 28, 1999 1,708,692 1,617,903 67,970
Feb. 28, 1998 2,402,715 2,223,313 95,881
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Amount Retained by FDC
Air Transportation $ 2,545
946
Automotive 1,131
597
Biotechnology 23,624
31,256
Brokerage and Investment 5,812
Management
2,431
Business Services and 106
Outsourcing
0
Chemicals 7,081
7,955
Computers 5,657
6,144
Construction and Housing 653
240
Consumer Industries 208
805
Cyclical Industries 0
0
Defense and Aerospace 824
1,329
Developing Communications 3,177
6,980
Electronics 10,633
10,101
Energy 12,418
14,514
Energy Service 9,358
11,289
Environmental Services 7,574
6,428
Financial Services 13,596
8,343
Food and Agriculture 5,955
5,255
Gold 19,578
27,084
Health Care 58,978
56,845
Home Finance 13,199
5,349
Industrial Equipment 1,074
2,151
Industrial Materials 1,065
2,207
Insurance 1,491
786
Leisure 10,919
13,069
Amount Retained by FDC
Medical Delivery $ 6,973
6,095
Medical Equipment and Systems 2,642
Multimedia 1,687
739
Natural Gas 982
2,018
Natural Resources 8
26
Paper and Forest Products 737
2,161
Precious Metals and Minerals 18,943
30,793
Regional Banks 8,288
4,790
Retailing 2,870
2,757
Software and Computer Services 4,793
5,910
Technology 32,321
22,926
Telecommunications 12,323
16,675
Transportation 657
925
Utilities Growth 21,580
22,382
Money Market 67,970
95,881
</TABLE>
* Business Services and Outsourcing commenced operations on February
4, 1998.
** Cyclical Industries and Natural Resources commenced operations on
March 3, 1997.
*** Medical Equipment and Systems commenced operations on April 28,
1998.
TRANSFER AND SERVICE AGENT AGREEMENTS
Each fund has entered into a transfer agent agreement with FSC, an
affiliate of FMR. Under the terms of the agreements, FSC performs
transfer agency, dividend disbursing, and shareholder services for
each fund.
For providing transfer agency services, FSC receives an account fee
and an asset-based fee each paid monthly with respect to each account
in a fund. For retail accounts and certain institutional accounts,
these fees are based on account size and fund type. For certain
institutional retirement accounts, these fees are based on fund type.
For certain other institutional retirement accounts, these fees are
based on account type and fund type. The account fees are subject to
increase based on postage rate changes.
For the stock funds, the asset-based fees are subject to adjustment if
the year-to-date total return of the S&P 500 exceeds a positive or
negative 15%.
FSC also collects small account fees from certain accounts with
balances of less than $2,500.
In addition, FSC collects a $7.50 exchange fee for each exchange out
of a stock fund.
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 and each Fidelity Freedom
Fund, a fund of funds managed by an FMR affiliate, according to the
percentage of the QSTP's or Freedom Fund's assets that is invested in
a 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.
Each fund has also entered into a service agent agreement with FSC.
Under the terms of the agreements, FSC calculates the NAV and
dividends for each fund, maintains each fund's portfolio and general
accounting records, and administers each stock fund's securities
lending program.
For providing pricing and bookkeeping services, FSC receives a monthly
fee based on each fund's average daily net assets throughout the
month.
The annual rates for pricing and bookkeeping services for the money
market fund are 0.0150% for the first $500 million of average net
assets, 0.0075% of average net assets between $500 million and $10
billion, and 0.0010% of average net assets in excess of $10 billion.
The fee, not including reimbursement for out-of-pocket expenses, is
limited to a minimum of $40,000 per year.
The annual rates for pricing and bookkeeping services for the stock
funds are 0.0750% for the first $500 million of average net assets,
0.0550% of average net assets between $500 million and $3 billion, and
0.0010% of average net assets in excess of $3 billion. The fee, not
including reimbursement for out-of-pocket expenses, is limited to a
minimum of $60,000 per year.
Pricing and bookkeeping fees, including reimbursement for
out-of-pocket expenses, paid by the funds to FSC for the past three
fiscal years are shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PRICING AND BOOKKEEPING FEES
FISCAL 1999 FISCAL 1998 FISCAL 1997
Air Transportation $ 98,333 $ 73,865 $ 92,138
Automotive 67,412 65,849 120,805
Biotechnology 518,521 538,574 612,580
Brokerage and Investment 593,407 404,906 88,697
Management
Business Services and 60,809 5,000* N/A
Outsourcing
Chemicals 62,258 83,611 123,784
Computers 746,605 578,646 520,629
Construction and Housing 80,383 60,209 76,325
Consumer Industries 75,037 61,506 60,450
Cyclical Industries 60,050 59,755** N/A
Defense and Aerospace 68,157 68,287 61,443
Developing Communications 287,287 239,077 308,377
Electronics 967,497 802,315 799,758
Energy 135,861 191,416 177,681
Energy Service 545,287 680,412 445,567
Environmental Services 57,141 60,348 64,394
Financial Services 543,141 465,691 276,349
Food and Agriculture 220,104 246,634 279,388
Gold 199,332 280,044 416,410
Health Care 964,925 800,697 805,100
Home Finance 753,655 791,859 596,198
Industrial Equipment 60,400 65,050 93,288
Industrial Materials 60,350 60,356 98,357
Insurance 106,572 114,165 60,415
Leisure 279,815 143,851 107,125
Medical Delivery 150,958 161,193 215,825
Medical Equipment and Systems 50,606*** N/A N/A
Multimedia 124,969 68,383 85,280
Natural Gas 60,991 82,484 113,435
Natural Resources 60,054 59,758** N/A
Paper and Forest Products 60,339 60,338 60,429
Precious Metals and Minerals 145,054 195,123 333,124
Regional Banks 777,110 749,121 408,850
Retailing 268,863 153,141 222,542
Software and Computer Services 517,970 436,026 419,686
Technology 622,874 524,451 466,774
Telecommunications 625,067 410,851 479,593
Transportation 61,603 64,993 60,368
Utilities Growth 389,868 274,740 239,403
Money Market 120,261 111,447 108,892
</TABLE>
* Business Services and Outsourcing commenced operations on February
4, 1998.
** Cyclical Industries and Natural Resources commenced operations on
March 3, 1997.
*** Medical Equipment and Systems commenced operations on April 28,
1998.
For administering each stock fund's securities lending program, FSC
receives fees based on the number and duration of individual
securities loans.
For the fiscal years ended February 1999, 1998, and 1997, no
securities lending fees were incurred by those funds not listed below.
Securities lending fees paid by the funds to FSC for the past three
fiscal years are shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
SECURITIES LENDING FEES
FISCAL 1999 FISCAL 1998 FISCAL 1997
Biotechnology $ 18,000 $ 8,740 $ 9,415
Chemicals 395 4,265 770
Computers 17,470 11,975 6,265
Construction and Housing 355 298 445
Electronics 14,330 31,045 13,690
Energy 365 575 2,320
Energy Service 125 2,025 1,290
Financial Services 275 775 0
Food and Agriculture 2,160 5,870 0
Gold 435 1,255 3,065
Health Care 13,910 7,995 7,915
Medical Delivery 2,510 1,275 8,900
Regional Banks 145 2,730 3,860
Precious Metals and Minerals 285 965 710
Retailing 125 2,570 4,965
Software and Computer Services 7,605 18,840 5,940
Technology 11,065 20,865 16,005
Telecommunications 57,445 10,585 10,530
Transportation 625 3,155 0
Utilities Growth 6,915 2,530 780
</TABLE>
DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. Fidelity Select Portfolios is an open-end
management investment company organized as a Massachusetts business
trust on November 20, 1980. On June 1, 1998, American Gold Portfolio
changed its name from American Gold Portfolio to "Gold Portfolio." On
July 18, 1996, Consumer Products Portfolio changed its name from
Consumer Products Portfolio to "Consumer Industries Portfolio." On
August 3, 1994, Utilities Portfolio changed its name from Utilities
Portfolio to "Utilities Growth Portfolio." On April 30, 1994,
Broadcast and Media Portfolio changed its name from Broadcast and
Media Portfolio to "Multimedia Portfolio." Currently, there are 40
funds in Fidelity Select Portfolios: Air Transportation Portfolio,
Automotive Portfolio, Biotechnology Portfolio, Brokerage and
Investment Management Portfolio, Business Services and Outsourcing,
Chemicals Portfolio, Computers Portfolio, Construction and Housing
Portfolio, Consumer Industries Portfolio, Cyclical Industries
Portfolio, Defense and Aerospace Portfolio, Developing Communications
Portfolio, Electronics Portfolio, Energy Portfolio, Energy Service
Portfolio, Environmental Services Portfolio, Financial Services
Portfolio, Food and Agriculture Portfolio, Gold Portfolio, Health Care
Portfolio, Home Finance Portfolio, Industrial Equipment Portfolio,
Industrial Materials Portfolio, Insurance Portfolio, Leisure
Portfolio, Medical Delivery Portfolio, Medical Equipment and Systems
Portfolio, Multimedia Portfolio, Natural Gas Portfolio, Natural
Resources Portfolio, Paper and Forest Products Portfolio, Precious
Metals and Minerals Portfolio, Regional Banks Portfolio, Retailing
Portfolio, Software and Computer Services Portfolio, Technology
Portfolio, Telecommunications Portfolio, Transportation Portfolio,
Utilities Growth Portfolio, and Money Market Portfolio. 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 trust is an entity commonly known as a
"Massachusetts business trust." Under Massachusetts law, shareholders
of such a trust may, under certain circumstances, be held personally
liable for the obligations of the trust.
The Declaration of Trust contains an express disclaimer of shareholder
liability for the debts, liabilities, obligations, and expenses of the
trust or fund. The Declaration of Trust provides that the trust 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 trust or the Trustees
relating to the trust or to a fund shall include a provision limiting
the obligations created thereby to the trust or to one or more funds
and its or their assets. The Declaration of Trust further provides
that shareholders of a fund shall not have a claim on or right to any
assets belonging to any other fund.
The Declaration of Trust provides for indemnification out of each
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 Declaration of
Trust also provides that each 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 a fund
itself would be unable to meet its obligations. FMR believes that, in
view of the above, the risk of personal liability to shareholders is
remote.
VOTING RIGHTS. Each 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 that you own. The voting rights of
shareholders can be changed only by a shareholder vote. Shares may be
voted in the aggregate, by fund and 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.
The trust or any of its funds may be terminated upon the sale of its
assets to, or merger with, another open-end management investment
company or series thereof, or upon liquidation and distribution of its
assets. Generally, the merger of the trust or a fund with another
entity or the sale of substantially all of the assets of the trust or
a fund to another entity requires approval by a vote of shareholders
of the trust or the fund. The Trustees may, however, reorganize or
terminate the trust or any of its funds without prior shareholder
approval. In the event of the dissolution or liquidation of the trust,
shareholders of each of its funds are entitled to receive the
underlying assets of such fund available for distribution. In the
event of the dissolution or liquidation of a fund, shareholders of
that fund are entitled to receive the underlying assets of the fund
available for distribution.
CUSTODIAN. Brown Brothers Harriman & Co., 40 Water Street, Boston,
Massachusetts is custodian of the assets of the stock funds. The Bank
of New York, 110 Washington Street, New York, New York, is custodian
of the assets of the money market fund. Each custodian is responsible
for the safekeeping of a fund's assets and the appointment of any
subcustodian banks and clearing agencies. The Bank of New York and The
Chase Manhattan Bank, each headquartered in New York, also may serve
as special purpose custodians 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. The Boston branch of the stock funds' custodian
leases its office space from an affiliate of FMR at a lease payment
which, when entered into, was consistent with prevailing market rates.
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. PricewaterhouseCoopers LLP, 160 Federal Street, Boston,
Massachusetts serves as independent accountant for each
fund . The auditor examines financial statements for the funds and
provides other audit, tax, and related services.
FINANCIAL STATEMENTS
Each fund's financial statements and financial highlights for the
fiscal year ended February 28, 1999, and report of the auditor, are
included in the funds' Annual Report and are incorporated herein by
reference.
APPENDIX
Select Portfolios, Fidelity, Fidelity Investments & (Pyramid )
Design, Fidelity Focus, Fidelity Investments, and Magellan, are
registered trademarks of FMR Corp.
Portfolio Advisory Services 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) Amended and Restated Declaration of Trust, dated May 13, 1998, is
incorporated herein by reference to Exhibit a(1) of
Post-Effective Amendment No. 65.
(b) Bylaws of the Trust, as amended, are incorporated herein by
reference to Exhibit 2(a) of Fidelity Union Street Trust's (File
no. 2-50318) Post-Effective Amendment No. 87.
(c) Not applicable.
(d)(1) Management Contracts, dated June 1, 1998, between the Trust's
Air Transportation, Automotive, Biotechnology, Brokerage and
Investment Management, Chemicals, Computers, Construction and
Housing, Consumer Industries, Defense and Aerospace,
Developing Communications, Electronics, Energy, Energy
Service, Environmental Services, Financial Services, Food and
Agriculture, Gold, Health Care, Home Finance, Industrial
Equipment, Industrial Materials, Insurance, Leisure, Medical
Delivery, Multimedia, Natural Gas, Paper and Forest Products,
Precious Metals and Minerals, Regional Banks, Retailing,
Software and Computer Services, Technology,
Telecommunications, Transportation, Utilities Growth, and
Money Market Portfolios and Fidelity Management & Research
Company, are incorporated herein by reference to Exhibits
d(1)(a-jj) of Post-Effective Amendment No. 65.
(2) Sub-Advisory Agreements, dated March 1, 1994, between Fidelity
Management & Research Company and Fidelity Management &
Research (U.K.) Inc. and between Fidelity Management &
Research Company and Fidelity Management & Research (Far East)
Inc., respectively, with respect to the Registrant's Air
Transportation, Automotive, Biotechnology, Brokerage and
Investment Management, Chemicals, Computers, Construction and
Housing (formerly Housing), Consumer Industries (formerly
Consumer Products), Defense and Aerospace, Developing
Communications, Electronics, Energy, Energy Service,
Environmental Services, Financial Services, Food and
Agriculture, Health Care, Home Finance (formerly Savings and
Loan), Industrial Equipment (formerly Industrial Technology),
Industrial Materials, Insurance (formerly Property and
Casualty Insurance), Leisure, Medical Delivery, Multimedia
(formerly Broadcast and Media), Natural Gas, Paper and Forest
Products, Precious Metals and Minerals, Regional Banks,
Retailing, Software and Computer Services, Technology,
Telecommunications, Transportation, and Utilities Growth
(formerly Utilities) Portfolios, are incorporated herein by
reference to Exhibit Nos. 5(b)(1-34) of Post-Effective
Amendment No. 48.
(3) Sub-Advisory Agreement, dated January 1, 1990, between
Fidelity Management & Research Company and FMR Texas Inc.
(currently known as Fidelity Investments Money Management,
Inc.) with respect to the Money Market Portfolio, is
incorporated herein by reference to Exhibit 5(c) of
Post-Effective Amendment No. 51.
(4) Management Contract, dated January 16, 1997, between Cyclical
Industries Portfolio and Fidelity Management & Research
Company, is incorporated herein by reference to Exhibit 5(d)
of Post-Effective Amendment 58.
(5) Management Contract, dated January 16, 1997, between Natural
Resources Portfolio and Fidelity Management & Research
Company, is incorporated herein by reference to Exhibit 5(e)
of Post-Effective Amendment 58.
(6) Sub-Advisory Agreement, dated January 16, 1997, between
Fidelity Management & Research (U.K.) Inc. and Fidelity
Management & Research Company on behalf of Cyclical Industries
Portfolio, is incorporated herein by reference to Exhibit 5(f)
of Post-Effective Amendment 59.
(7) Sub-Advisory Agreement, dated January 16, 1997, between
Fidelity Management & Research (Far East) Inc. and Fidelity
Management & Research Company on behalf of Cyclical Industries
Portfolio, is incorporated herein by reference to Exhibit 5(g)
of Post-Effective Amendment 59.
(8) Sub-Advisory Agreement, dated January 16, 1997, between
Fidelity Management & Research (U.K.) Inc. and Fidelity
Management & Research Company on behalf of Natural Resources
Portfolio, is incorporated herein by reference to Exhibit 5(h)
of Post-Effective Amendment 59.
(9) Sub-Advisory Agreement, dated January 16, 1997, between
Fidelity Management & Research (Far East) Inc. and Fidelity
Management & Research Company on behalf of Natural Resources
Portfolio, is incorporated herein by reference to Exhibit 5(i)
of Post-Effective Amendment 59.
(10) Management Contract, dated December 18, 1997, between Business
Services and Outsourcing Portfolio and Fidelity Management &
Research Company, is incorporated herein by reference to
Exhibit 5(j) of Post-Effective Amendment No. 62.
(11) Management Contract, dated December 18, 1997, between Medical
Equipment and Systems Portfolio and Fidelity Management &
Research Company, is incorporated herein by reference to
Exhibit 5(k) of Post-Effective Amendment No. 64.
(12) Sub-Advisory Agreement, dated December 18, 1997, between
Fidelity Management & Research (U.K.) Inc. and Fidelity
Management & Research Company on behalf of Business Services
and Outsourcing Portfolio, is incorporated herein by reference
to Exhibit 5(l) of Post-Effective Amendment No. 62.
(13) Sub-Advisory Agreement, dated December 18, 1997, Fidelity
Management & Research (Far East) Inc. and Fidelity Management
& Research Company on behalf of Business Services and
Outsourcing Portfolio, is incorporated herein by reference to
Exhibit 5(m) of Post-Effective Amendment No. 62.
(14) Sub-Advisory Agreement, dated December 18, 1997, between
Fidelity Management & Research (U.K.) Inc. and Fidelity
Management & Research Company on behalf of Medical Equipment
and Systems Portfolio, is incorporated herein by reference to
Exhibit d(14) of Post-Effective Amendment No. 65.
(15) Sub-Advisory Agreement, dated December 18, 1997, between
Fidelity Management & Research (Far East) Inc. and Fidelity
Management & Research Company on behalf of Medical Equipment
and Systems Portfolio, is incorporated herein by reference to
Exhibit d(15) of Post-Effective Amendment No. 65.
(16) Sub-Advisory Agreement, dated June 1, 1998, between Fidelity
Management & Research (U.K.) Inc. and Fidelity Management &
Research Company on behalf of Gold Portfolio, is incorporated
herein by reference to Exhibit d(16) of Post-Effective
Amendment No. 65.
(17) Sub-Advisory Agreement, dated June 1, 1998, between Fidelity
Management & Research (Far East) Inc. and Fidelity Management
& Research Company on behalf of Gold Portfolio, is
incorporated herein by reference to Exhibit d(17) of
Post-Effective Amendment No. 65.
(e)(1) General Distribution Agreements, dated April 1, 1987, between
the Registrant's Air Transportation, Gold (formerly American
Gold), Automotive, Biotechnology, Brokerage and Investment
Management, Chemicals, Computers, Construction and Housing
(formerly Housing), Defense and Aerospace, Electronics,
Energy, Energy Service, Financial Services, Food and
Agriculture, Health Care, Home Finance (formerly Savings and
Loan), Industrial Materials, Insurance (formerly Property and
Casualty Insurance), Leisure, Medical Delivery, Money Market,
Multimedia (formerly Broadcast and Media), Paper and Forest
Products, Precious Metals and Minerals, Regional Banks,
Retailing, Software and Computer Services, Technology,
Telecommunications, Transportation, and Utilities Growth
(formerly Utilities) Portfolios and Fidelity Distributors
Corporation, are incorporated herein by reference to Exhibit
Nos. 6(a)(1-31) of Post-Effective Amendment No. 51.
(2) Amendment to General Distribution Agreements, dated January 1,
1988, between the Registrant's Air Transportation, Gold
(formerly American Gold), Automotive, Biotechnology, Brokerage
and Investment Management, Chemicals, Computers, Construction
and Housing (formerly Housing), Defense and Aerospace,
Electronics, Energy, Energy Service, Financial Services, Food
and Agriculture, Health Care, Home Finance (formerly Savings
and Loan), Industrial Materials, Industrial Equipment
(formerly Capital Goods), Insurance (formerly Property and
Casualty Insurance), Leisure, Medical Delivery, Money Market,
Multimedia (formerly Broadcast and Media), Paper and Forest
Products, Precious Metals and Minerals, Regional Banks,
Retailing, Software and Computer Services, Technology,
Telecommunications, Transportation, and Utilities Growth
(formerly Utilities) Portfolios and Fidelity Distributors
Corporation, is incorporated herein by reference to Exhibit
6(b) of Post-Effective Amendment No. 51.
(3) General Distribution Agreement, dated June 29, 1989, between
the Registrant's Environmental Services Portfolio and Fidelity
Distributors Corporation, is incorporated herein by reference
to Exhibit 6(c) of Post-Effective Amendment No. 51.
(4) General Distribution Agreement, dated June 14, 1990, between
the Registrant's Consumer Industries (formerly Consumer
Products) Portfolio and Fidelity Distributors Corporation, is
incorporated herein by reference to Exhibit 6(d) of
Post-Effective Amendment No. 51.
(5) General Distribution Agreement, dated June 14, 1990 between
the Registrant's Developing Communications Portfolio and
Fidelity Distributors Corporation, is incorporated herein by
reference to Exhibit 6(e) of Post-Effective Amendment No. 51.
(6) General Distribution Agreement, dated April 15, 1993, between
the Registrant's Natural Gas Portfolio and Fidelity
Distributors Corporation, is incorporated herein by reference
to Exhibit 6(f) of Post-Effective Amendment No. 46.
(7) Amendment, dated May 10, 1994, to the General Distribution
Agreement, dated April 15, 1993, between the Registrant's
Natural Gas Portfolio and Fidelity Distributors Corporation,
is incorporated herein by reference to Exhibit 6(g) of
Post-Effective Amendment No. 50.
(8) General Distribution Agreement, dated April 1, 1987, between
the Registrant's Industrial Equipment (formerly Capital Goods)
Portfolio and Fidelity Distributors Corporation, is
incorporated herein by reference to Exhibit 6(h) of
Post-Effective Amendment No. 54.
(9) General Distribution Agreement, dated January 16, 1997,
between Cyclical Industries Portfolio and Fidelity
Distributors Corporation, is incorporated herein by reference
to Exhibit 6(i) of Post-Effective Amendment 59.
(10) General Distribution Agreement, dated January 16, 1997,
between Natural Resources Portfolio and Fidelity Distributors
Corporation, is incorporated herein by reference to Exhibit
6(j) of Post-Effective Amendment 59.
(11) Amendments, dated March 14, 1996 and July 15, 1996, to the
General Distribution Agreement between Fidelity Select
Portfolios on behalf of each Fidelity Select Portfolio except
Natural Gas, Cyclical Industries, Natural Resources, Business
Services and Outsourcing, and Medical Equipment and Systems
and Fidelity Distributors Corporation are incorporated herein
by reference to Exhibit 6(k) of Post-Effective Amendment No.
57.
(12) Amendments, dated March 14, 1996 and July 15, 1996, to the
General Distribution Agreement between Fidelity Select
Portfolios on behalf of Fidelity Select Natural Gas Portfolio
and Fidelity Distributors Corporation are incorporated herein
by reference to Exhibit 6(l) of Post-Effective Amendment No.
57.
(13) General Distribution Agreement, dated December 18, 1997,
between Business Services and Outsourcing Portfolio and
Fidelity Distributors Corporation, is incorporated herein by
reference to Exhibit 6(m) of Post-Effective Amendment No. 62.
(14) General Distribution Agreement, between Medical Equipment and
Systems Portfolio and Fidelity Distributors Corporation, is
incorporated herein by reference to Exhibit 6(n) of
Post-Effective No. 64.
(15) Form of Bank Agency Agreement (most recently revised January,
1997), is filed herein as Exhibit e(15).
(16) Form of Selling Dealer Agreement for Bank-Related Transactions
(most recently revised January, 1997), is filed herein as
Exhibit e(16).
(f)(1) Retirement Plan for Non-Interested Person Trustees, Directors
or General Partners, as amended November 16, 1995, is
incorporated herein by reference to Exhibit 7(a) of
Post-Effective Amendment No. 54.
(2) The Fee Deferral Plan for Non-Interested Person 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) of Fidelity Aberdeen
Street Trust's (File No. 33-43529) Post-Effective Amendment
No. 19.
(g)(1) Custodian Agreement and Appendix C, dated September 1, 1994,
between Brown Brothers Harriman & Company and Fidelity Select
Portfolios on behalf of the equity portfolios are incorporated
herein by reference to Exhibit 8(a) of Fidelity Commonwealth
Trust's (File No. 2-52322) Post-Effective Amendment No. 56.
(2) Appendix A, dated November 19, 1998, to the Custodian
Agreement, dated September 1, 1994, between Brown Brothers
Harriman & Company and Fidelity Select Portfolios on behalf of
the equity portfolios is incorporated herein by reference to
Exhibit g(2) of Fidelity Contrafund's (File No. 2-25235)
Post-Effective Amendment No. 53.
(3) Appendix B, dated December 17, 1998, to the Custodian
Agreement, dated September 1, 1994, between Brown Brothers
Harriman & Company and Fidelity Select Portfolios on behalf of
the equity portfolios is incorporated herein by reference to
Exhibit g(3) of Fidelity Contrafund's (File No. 2-25235)
Post-Effective Amendment No. 53.
(4) Custodian Agreement and Appendix C, dated December 1, 1994,
between The Bank of New York and Fidelity Select Portfolios on
behalf of Select Money Market Portfolio is incorporated herein
by reference to Exhibit 8(a) of Fidelity Hereford Street
Trust's (File No. 33-52577) Post-Effective Amendment No. 4.
(5) Appendix A, dated September 17, 1998, to the Custodian
Agreement, dated December 1, 1994, between The Bank of New
York and Fidelity Select Portfolios on behalf of Select Money
Market Portfolio is incorporated herein by reference to
Exhibit g(2) of Fidelity Concord Street Trust's (File No.
33-15983) Post-Effective Amendment No. 31.
(6) Appendix B, dated December 17, 1998, to the Custodian
Agreement, dated December 1, 1994, between The Bank of New
York and Fidelity Select Portfolios on behalf of Select Money
Market Portfolio is incorporated herein by reference to
Exhibit g(3) of Fidelity Concord Street Trust's (File No.
33-15983) Post-Effective Amendment No. 31.
(7) Fidelity Group Repo Custodian Agreement among The Bank of New
York, J. P. Morgan Securities, Inc., and Fidelity Select
Portfolios on behalf of all of the portfolios with the
exception of Cyclical Industries, Natural Resources, Business
Services and Outsourcing, and Medical Equipment and Systems
Portfolios, dated February 12, 1996, is incorporated herein by
reference to Exhibit 8(d) of Fidelity Institutional Cash
Portfolios' (File No. 2-74808) Post-Effective Amendment No.
31.
(8) Schedule 1 to the Fidelity Group Repo Custodian Agreement
between The Bank of New York and Fidelity Select Portfolios on
behalf of all of the portfolios with the exception of Cyclical
Industries, Natural Resources, Business Services and
Outsourcing, and Medical Equipment and Systems Portfolios,
dated February 12, 1996, is incorporated herein by reference
to Exhibit 8(e) of Fidelity Institutional Cash Portfolios'
(File No. 2-74808) Post-Effective Amendment No. 31.
(9) Fidelity Group Repo Custodian Agreement among Chemical Bank,
Greenwich Capital Markets, Inc., and Fidelity Select
Portfolios on behalf of all of the portfolios with the
exception of Cyclical Industries, Natural Resources, Business
Services and Outsourcing, and Medical Equipment and Systems
Portfolios, dated November 13, 1995, is incorporated herein by
reference to Exhibit 8(f) of Fidelity Institutional Cash
Portfolios' (File No. 2-74808) Post-Effective Amendment No.
31.
(10) Schedule 1 to the Fidelity Group Repo Custodian Agreement
between Chemical Bank and Fidelity Select Portfolios on behalf
of all of the portfolios with the exception of Cyclical
Industries, Natural Resources, Business Services and
Outsourcing, and Medical Equipment and Systems Portfolios,
dated November 13, 1995, is incorporated herein by reference
to Exhibit 8(g) of Fidelity Institutional Cash Portfolios'
(File No. 2-74808) Post-Effective Amendment No. 31.
(11) Joint Trading Account Custody Agreement between The Bank of
New York and Fidelity Select Portfolios on behalf of all of
the portfolios with the exception of Cyclical Industries,
Natural Resources, Business Services and Outsourcing, and
Medical Equipment and Systems Portfolios, dated May 11, 1995,
is incorporated herein by reference to Exhibit 8(h) of
Fidelity Institutional Cash Portfolios' (File No. 2-74808)
Post-Effective Amendment No. 31.
(12) First Amendment to Joint Trading Account Custody Agreement
between The Bank of New York and Fidelity Select Portfolios on
behalf of all of the portfolios with the exception of Cyclical
Industries Portfolio, Natural Resources Portfolio, Business
Services and Outsourcing Portfolio, and Medical Equipment and
Systems Portfolio, dated July 14, 1995, is incorporated herein
by reference to Exhibit 8(i) of Fidelity Institutional Cash
Portfolios' (File No. 2-74808) Post-Effective Amendment No.
31.
(13) Forms of Fidelity Group Repo Custodian Agreement and Schedule
1 among The Bank of New York, J. P. Morgan Securities, Inc.,
and Fidelity Select Portfolios on behalf of Cyclical
Industries Portfolio, Natural Resources Portfolio, Business
Services and Outsourcing Portfolio, and Medical Equipment and
Systems Portfolio are filed herein as Exhibit g(13).
(14) Forms of Fidelity Group Repo Custodian Agreement and Schedule
1 among Chemical Bank, Greenwich Capital Markets, Inc., and
Fidelity Select Portfolios on behalf of Cyclical Industries
Portfolio, Natural Resources Portfolios, Business Services and
Outsourcing Portfolio, and Medical Equipment and Systems
Portfolio are filed herein as Exhibit g(14).
(15) Forms of Joint Trading Account Custody Agreement and First
Amendment to Joint Trading Account Custody Agreement between
The Bank of New York and Fidelity Select Portfolios on behalf
of Cyclical Industries Portfolio, Natural Resources Portfolio,
Business Services and Outsourcing Portfolio, and Medical
Equipment and Systems Portfolio are filed herein as Exhibit
g(15).
(16) Forms of Custodian Agreement and Appendix B and C, between
Brown Brothers Harriman & Company and Fidelity Select
Portfolios on behalf of Business Services and Outsourcing
Portfolio and Medical Equipment and Systems Portfolio is filed
herein as Exhibit g(16).
(h) Not applicable.
(i) Not applicable.
(j) Consent of PricewaterhouseCoopers LLP, dated April 26, 1999 is
filed herein as Exhibit j(1).
(k) Not applicable.
(l) Not applicable.
(m) Not applicable.
(n) Financial Data Schedules for the funds are filed herein as
Exhibit 27.
(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
Article XI, Section 2 of the Declaration of Trust 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 Declaration of Trust, 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) FIDELITY MANAGEMENT & RESEARCH COMPANY (FMR)
82 Devonshire Street, Boston, MA 02109
FMR serves as investment adviser to a number of other investment
companies. The directors and officers of the Adviser have held,
during the past two fiscal years, the following positions of a
substantial nature.
Edward C. Johnson 3d Chairman of the Board and
Director of FMR; President
and Chief Executive Officer
of FMR Corp.; Chairman of
the Board and Director of
FMR Corp., 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);
Chairman of the Executive
Committee of FMR; Director
of Fidelity Investments
Japan Limited (FIJ);
President and Trustee of
funds advised by FMR.
Robert C. Pozen President and Director of
FMR; Senior Vice President
and Trustee of funds advised
by FMR; President and
Director of FIMM, FMR U.K.,
and FMR Far East;
Previously, General Counsel,
Managing Director, and
Senior Vice President of FMR
Corp.
Peter S. Lynch Vice Chairman of the Board
and Director of FMR.
John H. Carlson Vice President of FMR and of
funds advised by FMR.
Dwight D. Churchill Senior Vice President of FMR
and Vice President of Bond
Funds advised by FMR; Vice
President of FIMM.
Brian Clancy Vice President of FMR and
Treasurer of FMR, FIMM, FMR
U.K., and FMR Far East.
Barry Coffman Vice President of FMR.
Arieh Coll Vice President of FMR.
Frederic G. Corneel Tax Counsel of FMR.
Stephen G. Manning Assistant Treasurer of FMR,
FIMM, FMR U.K., FMR Far
East; Vice President and
Treasurer of FMR Corp.;
Treasurer of Strategic
Advisers, Inc.
William Danoff Senior Vice President of FMR
and Vice President of a fund
advised by FMR.
Scott E. DeSano Vice President of FMR.
Penelope Dobkin Vice President of FMR and of
a fund advised by FMR.
Walter C. Donovan Vice President of FMR.
Bettina Doulton Vice President of FMR and of
funds advised by FMR.
Margaret L. Eagle Vice President of FMR and of
funds advised by FMR.
William R. Ebsworth Vice President of FMR.
Richard B. Fentin Senior Vice President of FMR
and Vice President of a fund
advised by FMR.
Gregory Fraser Vice President of FMR and of
a fund advised by FMR.
Jay Freedman Assistant Clerk of FMR; Clerk
of FMR Corp., FMR U.K., FMR
Far East, and Strategic
Advisers, Inc.; Secretary of
FIMM; Associate General
Counsel FMR Corp.
David L. Glancy Vice President of FMR and of
a fund advised by FMR.
Barry A. Greenfield Vice President of FMR and of
a fund advised by FMR.
Boyce I. Greer Senior Vice President of FMR
and Vice President of Money
Market Funds advised by FMR;
Vice President of FIMM.
Bart A. Grenier Senior Vice President of FMR;
Vice President of
High-Income Funds advised by
FMR.
Robert J. Haber Vice President of FMR.
Richard C. Habermann Senior Vice President of FMR;
Vice President of funds
advised by FMR.
Fred L. Henning Jr. Senior Vice President of FMR
and Vice President of
Fixed-Income Funds advised
by FMR.
Bruce T. Herring Vice President of FMR.
Robert F. Hill Vice President of FMR;
Director of Technical
Research.
Abigail P. Johnson Senior Vice President of FMR
and Vice President of funds
advised by FMR; Director of
FMR Corp.; Associate
Director and Senior Vice
President of Equity Funds
advised by FMR.
David B. Jones Vice President of FMR.
Steven Kaye Senior Vice President of FMR
and of a fund advised by FMR.
Francis V. Knox Vice President of FMR;
Compliance Officer of FMR
U.K. and FMR Far East.
Harris Leviton Vice President of FMR and of
a fund advised by FMR.
Bradford E. Lewis Vice President of FMR and of
funds advised by FMR.
Richard R. Mace Jr. Vice President of FMR and of
funds advised by FMR.
Charles A. Mangum Vice President of FMR and of
a fund advised by FMR.
Kevin McCarey Vice President of FMR and of
a fund advised by FMR.
Neal P. Miller Vice President of FMR.
Jacques Perold Vice President of FMR.
Alan Radlo Vice President of FMR.
Eric D. Roiter Vice President, General
Counsel and Clerk of FMR and
Secretary of funds advised
by FMR.
Lee H. Sandwen Vice President of FMR.
Patricia A. Satterthwaite Vice President of FMR and of
a fund advised by FMR.
Fergus Shiel Vice President of FMR.
Richard A. Silver Vice President of FMR.
Carol A. Smith-Fachetti Vice President of FMR.
Steven J. Snider Vice President of FMR and of
funds advised by FMR.
Thomas T. Soviero Vice President of FMR and of
a fund advised by FMR.
Richard Spillane Senior Vice President of FMR;
Associate Director and
Senior Vice President of
Equity Funds advised by FMR;
Previously, Senior Vice
President and Director of
Operations and Compliance of
FMR U.K.
Thomas M. Sprague Vice President of FMR and of
funds advised by FMR.
Robert E. Stansky Senior Vice President of FMR
and Vice President of a fund
advised by FMR.
Scott D. Stewart Vice President of FMR.
Thomas Sweeney Vice President of FMR.
Beth F. Terrana Senior Vice President of FMR
and Vice President of a fund
advised by FMR.
Yoko Tilley Vice President of FMR.
Joel C. Tillinghast Vice President of FMR and of
a fund advised by FMR.
Robert Tuckett Vice President of FMR.
Jennifer Uhrig Vice President of FMR and of
funds advised by FMR.
George A. Vanderheiden Senior Vice President of FMR
and Vice President of funds
advised by FMR; Director of
FMR Corp.
Steven S. Wymer Vice President of FMR and of
a fund advised by FMR.
(2) FIDELITY MANAGEMENT & RESEARCH (U.K.) INC. (FMR U.K.)
25 Lovat Lane, London, EC3R 8LL, England
FMR U.K. provides investment advisory services to Fidelity Management
& Research Company and Fidelity Management Trust Company. The
directors and officers of the Sub-Adviser have held the following
positions of a substantial nature during the past two fiscal years.
Edward C. Johnson 3d Chairman of the Board and
Director of FMR U.K., FMR,
FMR Corp., FIMM, and FMR Far
East; President and Chief
Executive Officer of FMR
Corp.; Chairman of the
Executive Committee of FMR;
Director of Fidelity
Investments Japan Limited
(FIJ); President and Trustee
of funds advised by FMR.
Robert C. Pozen President and Director of FMR
U.K.; Senior Vice President
and Trustee of funds advised
by FMR; President and
Director of FIMM, FMR, and
FMR Far East; Previously,
General Counsel, Managing
Director, and Senior Vice
President of FMR Corp.
Brian Clancy Treasurer of FMR U.K., FMR
Far East, FMR, and FIMM and
Vice President of FMR.
Stephen G. Manning Assistant Treasurer of FMR
U.K., FMR, FMR Far East, and
FIMM; Vice President and
Treasurer of FMR Corp.;
Treasurer of Strategic
Advisers, Inc.
Francis V. Knox Compliance Officer of FMR
U.K. and FMR Far East; Vice
President of FMR.
Jay Freedman Clerk of FMR U.K., FMR Far
East, FMR Corp. and
Strategic Advisers, Inc.;
Assistant Clerk of FMR;
Secretary of FIMM; Associate
General Counsel FMR Corp.
Susan Englander Hislop Assistant Clerk of FMR U.K.,
FMR Far East and FIMM.
Sarah H. Zenoble Senior Vice President and
Director of Operations and
Compliance.
(3) FIDELITY MANAGEMENT & RESEARCH (Far East) INC. (FMR Far East)
Shiroyama JT Mori Bldg., 4-3-1 Toranomon Minato-ku, Tokyo 105,
Japan
FMR Far East provides investment advisory services to Fidelity
Management & Research Company and Fidelity Management Trust Company.
The directors and officers of the Sub-Adviser have held the following
positions of a substantial nature during the past two fiscal years.
Edward C. Johnson 3d Chairman of the Board and
Director of FMR Far East,
FMR, FMR Corp., FIMM, and
FMR U.K.; Chairman of the
Executive Committee of FMR;
President and Chief
Executive Officer of FMR
Corp.; Director of Fidelity
Investments Japan Limited
(FIJ); President and Trustee
of funds advised by FMR.
Robert C. Pozen President and Director of FMR
Far East; Senior Vice
President and Trustee of
funds advised by FMR;
President and Director of
FIMM, FMR U.K., and FMR;
Previously, General Counsel,
Managing Director, and
Senior Vice President of FMR
Corp.
Robert H. Auld Senior Vice President of FMR
Far East.
Brian Clancy Treasurer of FMR Far East,
FMR U.K., FMR, and FIMM and
Vice President of FMR.
Francis V. Knox Compliance Officer of FMR Far
East and FMR U.K.; Vice
President of FMR.
Jay Freedman Clerk of FMR Far East, FMR
U.K., FMR Corp. and
Strategic Advisers, Inc.;
Assistant Clerk of FMR;
Secretary of FIMM; Associate
General Counsel FMR Corp.
Susan Englander Hislop Assistant Clerk of FMR Far
East, FMR U.K. and FIMM.
Stephen G. Manning Assistant Treasurer of FMR
Far East, FMR, FMR U.K., and
FIMM; Vice President and
Treasurer of FMR Corp.;
Treasurer of Strategic
Advisers, Inc.
Billy Wilder Vice President of FMR Far
East; President and
Representative Director of
Fidelity Investments Japan
Limited.
(4) FIDELITY INVESTMENTS MONEY MANAGEMENT, INC. (FIMM)
Contra Way, Merrimack, NH 03054
FIMM provides investment advisory services to Fidelity Management &
Research Company. The directors and officers of the Sub-Adviser have
held the following positions of a substantial nature during the past
two fiscal years.
Edward C. Johnson 3d Chairman of the Board and
Director of FIMM, FMR, FMR
Corp., FMR Far East, and FMR
U.K.; Chairman of the
Executive Committee of FMR;
President and Chief
Executive Officer of FMR
Corp.; Director of Fidelity
Investments Japan Limited
(FIJ); President and Trustee
of funds advised by FMR.
Robert C. Pozen President and Director of
FIMM; Senior Vice President
and Trustee of funds advised
by FMR; President and
Director of FMR, FMR U.K.,
and FMR Far East;
Previously, General Counsel,
Managing Director, and
Senior Vice President of FMR
Corp.
Fred L. Henning Jr. Senior Vice President of
FIMM; Senior Vice President
of FMR and Vice President of
Fixed-Income Funds advised
by FMR.
Boyce I. Greer Vice President of FIMM;
Senior Vice President of FMR
and Vice President of Money
Market Funds advised by FMR.
Dwight D. Churchill Vice President of FIMM;
Senior Vice President of FMR
and Vice President of Bond
Funds advised by FMR.
Brian Clancy Treasurer of FIMM, FMR Far
East, FMR U.K., and FMR and
Vice President of FMR.
Jay Freedman Secretary of FIMM; Clerk of
FMR U.K., FMR Far East, FMR
Corp. and Strategic
Advisers, Inc.; Assistant
Clerk of FMR; Secretary of
FIMM; Associate General
Counsel FMR Corp.
Susan Englander Hislop Assistant Clerk of FIMM, FMR
U.K. and FMR Far East.
Stephen G. Manning Assistant Treasurer of FIMM,
FMR U.K., FMR Far East, and
FMR; Vice President and
Treasurer of FMR Corp.;
Treasurer 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 Senior 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
(c) Not applicable.
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'
respective custodians, The Bank of New York, 110 Washington Street,
New York, NY and Brown Brothers Harriman & Co., 40 Water Street,
Boston, MA.
Item 29. Management Services
Not applicable.
Item 30. Undertakings
(a) The Registrant undertakes for Natural Gas Portfolio, Cyclical
Industries Portfolio, Natural Resources Portfolio, Business Services
and Outsourcing Portfolio, and Medical Equipment and Systems
Portfolio: 1) to call a meeting of shareholders for the purpose of
voting upon the questions of removal of a trustee or trustees, when
requested to do so by record holders of not less than 10% of its
outstanding shares; and 2) to assist in communications with other
shareholders pursuant to Section 16(c)(1) and (2), whenever
shareholders meeting the qualifications set forth in Section 16(c)
seek the opportunity to communicate with other shareholders with a
view toward requesting a meeting.
(b) The Registrant, on behalf of Fidelity Select Portfolios, provided
the information required for the stock funds by Item 5A is contained
in the annual report, undertakes to furnish to each person to whom a
prospectus has been delivered, upon their request and without charge,
a copy of the Registrant's latest annual report to shareholders.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets
all of the requirements for the effectiveness of this Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and
has duly caused this Post-Effective Amendment No. 66 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 26th day of April 1999.
Fidelity Select Portfolios
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 26, 1999
(dagger)
Edward C. Johnson 3d (Principal Executive Officer)
/s/Richard A. Silver Treasurer April 26, 1999
Richard A. Silver
/s/Robert C. Pozen Trustee April 26, 1999
Robert C. Pozen
/s/Ralph F. Cox Trustee April 26, 1999
*
Ralph F. Cox
/s/Phyllis Burke Davis Trustee April 26, 1999
*
Phyllis Burke Davis
/s/Robert M. Gates Trustee April 26, 1999
**
Robert M. Gates
/s/E. Bradley Jones Trustee April 26, 1999
*
E. Bradley Jones
/s/Donald J. Kirk Trustee April 26, 1999
*
Donald J. Kirk
/s/Peter S. Lynch Trustee April 26, 1999
*
Peter S. Lynch
/s/Marvin L. Mann Trustee April 26, 1999
*
Marvin L. Mann
/s/William O. McCoy Trustee April 26, 1999
*
William O. McCoy
/s/Gerald C. McDonough Trustee April 26, 1999
*
Gerald C. McDonough
/s/Thomas R. Williams Trustee April 26, 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:
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 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 e(15)
FORM OF
BANK AGENCY AGREEMENT
We at Fidelity Distributors Corporation offer to make available to
your customers shares of the mutual funds, or the separate series or
classes of the mutual funds, listed on Schedules A and B attached to
this Agreement (the "Portfolios"). We may periodically change the
list of Portfolios by giving you written notice of the change. We are
the Portfolios' principal underwriter and act as agent for the
Portfolios. You (____________________________________) are a division
or affiliate of a bank (____________________________________) and
desire to make Portfolio shares available to your customers on the
following terms:
1. Certain Defined Terms: As used in this Agreement, the term
"Prospectus" means the applicable Portfolio's prospectus and related
statement of additional information, whether in paper format or
electronic format, included in the Portfolio's then currently
effective registration statement (or post-effective amendment
thereto), and any information that we or the Portfolio may issue to
you as a supplement to such prospectus or statement of additional
information (a "sticker"), all as filed with the Securities and
Exchange Commission (the "SEC") pursuant to the Securities Act of
1933.
2. Making Portfolio Shares Available to Your Customers: (a) In all
transactions covered by this Agreement: (i) you will act as agent for
your customers; in no transaction are you authorized to act as agent
for us or for any Portfolio; (ii) you will initiate transactions only
upon your customers' orders; (iii) we will execute transactions only
upon receiving instructions from you acting as agent for your
customers; and (iv) each transaction will be for your customer's
account and not for your own account. Each transaction will be
without recourse to you, provided that you act in accordance with the
terms of this Agreement.
(b) You agree to make Portfolio shares available to your customers
only at the applicable public offering price in accordance with the
Prospectus. If your customer qualifies for a reduced sales charge
pursuant to a special purchase plan (for example, a quantity discount,
letter of intent, or right of accumulation) as described in the
Prospectus, you agree to make Portfolio shares available to your
customer at the applicable reduced sales charge. You agree to deliver
or cause to be delivered to each customer, at or prior to the time of
any purchase of shares, a copy of the then current prospectus
(including any stickers thereto), unless such prospectus has already
been delivered to the customer, and to each customer who so requests,
a copy of the then current statement of additional information
(including any stickers thereto).
(c) You agree to order Portfolio shares from us only to cover
purchase orders that you have already received from your customers, or
for your own investment. You will not withhold placing customers'
orders so as to profit yourself as a result of such withholding (for
example, by a change in a Portfolio's net asset value from that used
in determining the offering price to your customers).
(d) We will accept your purchase orders only at the public offering
price applicable to each order, as determined in accordance with the
Prospectus. We will not accept from you a conditional order for
Portfolio shares. All orders are subject to acceptance or rejection
by us in our sole discretion. We may, without notice, suspend sales
or withdraw the offering of Portfolio shares, or make a limited
offering of Portfolio shares.
(e) The placing of orders with us will be governed by instructions
that we will periodically issue to you. You must pay for Portfolio
shares in New York or Boston clearing house funds or in federal funds
in accordance with such instructions, and we must receive your payment
on or before the settlement date established in accordance with Rule
15c6-1 under the Securities Exchange Act of 1934 (the "1934 Act").
(f) You agree to comply with all applicable state and federal laws
and with the rules and regulations of authorized regulatory agencies
thereunder. You agree to make Portfolio shares available to your
customers only in states where you may legally make such Portfolio's
shares available. You will not make available shares of any Portfolio
unless such shares are registered under the applicable state and
federal laws and the rules and regulations thereunder.
(g) Certificates evidencing Portfolio shares are not available; any
transaction in Portfolio shares will be effected and evidenced by
book-entry on the records maintained by Fidelity Investments
Institutional Operations Company, Inc. ("FIIOC"). A confirmation
statement evidencing transactions in Portfolio shares will be
transmitted to you.
(h) You may designate FIIOC to execute your customers' transactions
in Portfolio shares in accordance with the terms of any account,
program, plan, or service established or used by your customers, and
to confirm each transaction to your customers on your behalf on a
fully disclosed basis. At the time of the transaction, you guarantee
the legal capacity of your customers and any co-owners of such shares
so transacting in such shares.
3. Your Compensation: (a) Your fee, if any, for acting as agent
with respect to sales of Portfolio shares will be as provided in the
Prospectus or in the applicable schedule of agency fees issued by us
and in effect at the time of the sale. Upon written notice to you, we
or any Portfolio may change or discontinue any schedule of agency
fees, or issue a new schedule.
(b) If a Portfolio has adopted a plan pursuant to Rule 12b-1 under
the Investment Company Act of 1940 (a "Plan"), we may make
distribution payments or service payments to you under the Plan. If a
Portfolio does not have a currently effective Plan, we or Fidelity
Management & Research Company may make distribution payments or
service payments to you from our own funds. Any distribution payments
or service payments will be made in the amount and manner set forth in
the Prospectus or in the applicable schedule of distribution payments
or service payments issued by us and then in effect. Upon written
notice to you, we or any Portfolio may change or discontinue any
schedule of distribution payments or service payments, or issue a new
schedule. A schedule of distribution payments or service payments
will be in effect with respect to a Portfolio that has a Plan only so
long as that Portfolio's Plan remains in effect.
(c) After the effective date of any change in or discontinuance of
any schedule of agency fees, distribution payments, or service
payments, or the termination of a Plan, any agency fees, distribution
payments, or service payments will be allowable or payable to you only
in accordance with such change, discontinuance, or termination. You
agree that you will have no claim against us or any Portfolio by
virtue of any such change, discontinuance, or termination. In the
event of any overpayment by us of any agency fee, distribution
payment, or service payment, you will remit such overpayment.
(d) If, within seven (7) business days after our confirmation of
the original purchase order for shares of a Portfolio, such shares are
redeemed by the issuing Portfolio or tendered for redemption by the
customer, you agree (i) to refund promptly to us the full amount of
any agency fee, distribution payment, or service payment paid to you
on such shares, and (ii) if not yet paid to you, to forfeit the right
to receive any agency fee, distribution payment, or service payment
payable to you on such shares. We will notify you of any such
redemption within ten (10) days after the date of the redemption.
4. Certain Types of Accounts: (a) You may instruct FIIOC to
register purchased shares in your name and account as nominee for your
customers. If you hold Portfolio shares as nominee for your
customers, all Prospectuses, proxy statements, periodic reports, and
other printed material will be sent to you, and all confirmations and
other communications to shareholders will be transmitted to you. You
will be responsible for forwarding such printed material,
confirmations, and communications, or the information contained
therein, to all customers for whose account you hold any Portfolio
shares as nominee. However, we or FIIOC on behalf of itself or the
Portfolios will be responsible for the costs associated with your
forwarding such printed material, confirmations, and communications.
You will be responsible for complying with all reporting and tax
withholding requirements with respect to the customers for whose
account you hold any Portfolio shares as nominee.
(b) With respect to accounts other than those accounts referred to
in paragraph 4(a) above, you agree to provide us with all information
(including certification of taxpayer identification numbers and
back-up withholding instructions) necessary or appropriate for us to
comply with legal and regulatory reporting requirements.
(c) Accounts opened or maintained pursuant to the NETWORKING system
of the National Securities Clearing Corporation ("NSCC") will be
governed by applicable NSCC rules and procedures and any agreement or
other arrangement with us relating to NETWORKING.
(d) If you hold Portfolio shares in an omnibus account for two or
more customers, you will be responsible for determining, in accordance
with the Prospectus, whether, and the extent to which, a CDSC is
applicable to a purchase of Portfolio shares from such a customer, and
you agree to transmit immediately to us any CDSC to which such
purchase was subject. You hereby represent that if you hold Portfolio
shares subject to a CDSC, you have the capability to track and account
for such charge, and we reserve the right, at our discretion, to
verify that capability by inspecting your tracking and accounting
system or otherwise.
5. Status as Registered Broker/Dealer or "Bank": (a) Each party to
this Agreement represents to the other party that it is either (i) a
registered broker/dealer under the 1934 Act, or (ii) a "bank" as
defined in Section 3(a)(6) of the 1934 Act.
(b) If a party is a registered broker/dealer, such party represents
that it is qualified to act as a broker/dealer in the states where it
transacts business, and it is a member in good standing of the
National Association of Securities Dealers, Inc. ("NASD"). It agrees
to maintain its broker/dealer registration and qualifications and its
NASD membership in good standing throughout the term of this
Agreement. It agrees to abide by all of the NASD's rules and
regulations, including the NASD's Conduct Rules -- in particular,
Section 2830 of such Rules, which section is deemed a part of and is
incorporated by reference in this Agreement. This Agreement will
terminate automatically without notice in the event that a party's
NASD membership is terminated.
(c) If you are a "bank", you represent that you are duly authorized
to engage in the transactions to be performed under this Agreement,
and you agree to comply with all applicable federal and state laws,
including the rules and regulations of all applicable federal and
state bank regulatory agencies and authorities. This Agreement will
terminate automatically without notice in the event that you cease to
be a "bank" as defined in Section 3(a)(6) of the 1934 Act.
(d) Nothing in this Agreement shall cause you to be our partner,
employee, or agent, or give you any authority to act for us or for any
Portfolio. Neither we nor any Portfolio shall be liable for any of
your acts or obligations as a dealer under this Agreement.
6. Information Relating to the Portfolios: (a) No person is
authorized to make any representations concerning shares of a
Portfolio other than those contained in the Portfolio's Prospectus.
In ordering Portfolio shares from us under this Agreement, you will
rely only on the representations contained in the Prospectus. Upon
your request, we will furnish you with a reasonable number of copies
of the Portfolios' current prospectuses or statements of additional
information or both (including any stickers thereto).
(b) Any printed or electronic information that we furnish you
(other than the Portfolios' Prospectuses and periodic reports) is our
sole responsibility and not the responsibility of the respective
Portfolios. You agree that the Portfolios will have no liability or
responsibility to you with respect to any such printed or electronic
information. We or the respective Portfolio will bear the expense of
qualifying its shares under the state securities laws.
(c) You may not use any sales literature or advertising material
(including material disseminated through radio, television, or other
electronic media) concerning Portfolio shares, other than the printed
or electronic information referred to in paragraph 6(b) above, in
connection with making Portfolio shares available to your customers
without obtaining our prior written approval. You may not distribute
or make available to investors any information that we furnish you
marked "FOR DEALER USE ONLY" or that otherwise indicates that it is
confidential or not intended to be distributed to investors.
7. Indemnification: (a) We will indemnify and hold you harmless
from any claim, demand, loss, expense, or cause of action resulting
from the misconduct or negligence, as measured by industry standards,
of us, our agents and employees, in carrying out our obligations under
this Agreement. Such indemnification will survive the termination of
this Agreement.
(b) You will indemnify and hold us harmless from any claim, demand,
loss, expense, or cause of action resulting from the misconduct or
negligence, as measured by industry standards, of you, your agents and
employees, in carrying out your obligations under this Agreement.
Such indemnification will survive the termination of this Agreement.
8. Customer Lists: We hereby agree that we shall not use any list of
your customers which may be obtained in connection with this Agreement
for the purpose of solicitation of any product or service without your
express written consent. However, nothing in this paragraph or
otherwise shall be deemed to prohibit or restrict us or our affiliates
in any way from solicitations of any product or service directed at,
without limitation, the general public, any segment thereof, or any
specific individual, provided such solicitation is not based upon such
list.
9. Duration of Agreement: This Agreement, with respect to any Plan,
will continue in effect for one year from its effective date, and
thereafter will continue automatically for successive annual periods;
provided, however, that such continuance is subject to termination at
any time without penalty if a majority of a Portfolio's Trustees who
are not interested persons of the Portfolio (as defined in the
Investment Company Act of 1940 (the "1940 Act")), or a majority of the
outstanding shares of the Portfolio, vote to terminate or not to
continue the Plan. This Agreement, other than with respect to a Plan,
will continue in effect from year to year after its effective date,
unless terminated as provided herein.
10. Amendment and Termination of Agreement: (a) We may amend any
provision of this Agreement by giving you written notice of the
amendment. Either party to this Agreement may terminate the Agreement
without cause by giving the other party at least thirty (30) days'
written notice of its intention to terminate. This Agreement will
terminate automatically in the event of its assignment (as defined in
the 1940 Act).
(b) In the event that (i) an application for a protective decree
under the provisions of the Securities Investor Protection Act of 1970
is file against you; (ii) you file a petition in bankruptcy or a
petition seeking similar relief under any bankruptcy, insolvency, or
similar law, or a proceeding is commenced against you seeking such
relief; or (iii) you are found by the SEC, the NASD, or any other
federal or state regulatory agency or authority to have violated any
applicable federal or state law, rule or regulation arising out of
your activities as a broker/dealer or in connection with this
Agreement, this Agreement will terminate effective immediately upon
our giving notice of termination to you. You agree to notify us
promptly and to immediately suspend making Portfolio shares available
to your customers in the event of any such filing or violation, or in
the event that you cease to be a member in good standing of the NASD
or you cease to be a "bank" as defined in Section 3(a)(6) of the 1934
Act.
(c) Your or our failure to terminate this Agreement for a
particular cause will not constitute a waiver of the right to
terminate this Agreement at a later date for the same or another
cause. The termination of this Agreement with respect to any one
Portfolio will not cause its termination with respect to any other
Portfolio.
11. Arbitration: In the event of a dispute, such dispute will be
settled by arbitration before arbitrators sitting in Boston,
Massachusetts in accordance with the NASD's Code of Arbitration
Procedure in effect at the time of the dispute. The arbitrators will
act by majority decision and their award may allocate attorneys' fees
and arbitration costs between us. Their award will be final and
binding between us, and such award may be entered as a judgment in any
court of competent jurisdiction.
12. Notices: All notices required or permitted to be given under this
Agreement shall be given in writing and delivered by personal
delivery, by postage prepaid mail, or by facsimile machine or a
similar means of same day delivery (with a confirming copy by mail).
All notices to us shall be given or sent to us at our offices located
at 82 Devonshire Street, Mail Zone L12A, Boston, Massachusetts 02109,
Attn: Bank Wholesale Market. All notices to you shall be given or
sent to you at the address specified by you below. Each of us may
change the address to which notices shall be sent by giving notice to
the other party in accordance with this paragraph 12.
13. Miscellaneous: This Agreement, as it may be amended from time to
time, shall become effective as of the date when it is accepted and
dated below by us. This Agreement is to be construed in accordance
with the laws of the Commonwealth of Massachusetts. This Agreement
supersedes and cancels any prior agreement between us, whether oral or
written, relating to the sale of shares of the Portfolios or any other
subject covered by this Agreement. The captions in this Agreement are
included for convenience of reference only and in no way define or
limit any of the provisions of this Agreement or otherwise affect
their construction or effect.
Very truly yours,
FIDELITY DISTRIBUTORS
CORPORATION
Please return two signed copies of this Agreement to Fidelity
Distributors Corporation. Upon acceptance, one countersigned copy
will be returned to you for your files.
_____________________________________
Name of Firm
Address: _____________________________
_____________________________________
_____________________________________
By __________________________________
Authorized Representative
_____________________________________
Name and Title (please print or type)
ACCEPTED AND AGREED:
FIDELITY DISTRIBUTORS CORPORATION
By __________________________________
Dated: ________________
** DISCARD THIS PAGE AND ATTACH REVISED SCHEDULES A AND B **
Exhibit e(16)
FORM OF
SELLING DEALER AGREEMENT
(FOR BANK-RELATED TRANSACTIONS)
We at Fidelity Distributors Corporation invite you to distribute
shares of the mutual funds, or the separate series or classes of the
mutual funds, listed on Schedules A and B attached to this Agreement
(the "Portfolios"). We may periodically change the list of Portfolios
by giving you written notice of the change. We are the Portfolios'
principal underwriter and, as agent for the Portfolios, we offer to
sell Portfolio shares to you on the following terms:
1. Certain Defined Terms: (a) You
(_____________________________________) are registered as a
broker/dealer under the Securities Exchange Act of 1934 (the "1934
Act") and have executed a written agreement with a bank or bank
affiliate to provide brokerage services to that bank, bank affiliate
and/or their customers. As used in this Agreement, the term "Bank"
means a bank as defined in Section 3(a)(6) of the 1934 Act, or an
affiliate of such a bank, with which you have entered into a written
agreement to provide brokerage services; and the term "Bank Client"
means a customer of such a Bank.
(b) As used in this Agreement, the term "Prospectus" means the
applicable Portfolio's prospectus and related statement of additional
information, whether in paper format or electronic format, included in
the Portfolio's then currently effective registration statement (or
post-effective amendment thereto), and any information that we or the
Portfolio may issue to you as a supplement to such prospectus or
statement of additional information (a "sticker"), all as filed with
the Securities and Exchange Commission (the "SEC") pursuant to the
Securities Act of 1933.
2. Purchases of Portfolio Shares for Sale to Customers: (a) In
offering and selling Portfolio shares to your customers, you agree to
act as dealer for your own account; you are not authorized to act as
agent for us or for any Portfolio.
(b) You agree to offer and sell Portfolio shares to your customers
only at the applicable public offering price in accordance with the
Prospectus. If your customer qualifies for a reduced sales charge
pursuant to a special purchase plan (for example, a quantity discount,
letter of intent, or right of accumulation) as described in the
Prospectus, you agree to offer and sell Portfolio shares to your
customer at the applicable reduced sales charge. You agree to deliver
or cause to be delivered to each customer, at or prior to the time of
any purchase of shares, a copy of the then current prospectus
(including any stickers thereto), unless such prospectus has already
been delivered to the customer, and to each customer who so requests,
a copy of the then current statement of additional information
(including any stickers thereto).
(c) You agree to purchase Portfolio shares from us only to cover
purchase orders that you have already received from your customers, or
for your own investment. You also agree not to purchase any Portfolio
shares from your customers at a price lower than the applicable
redemption price, determined in the manner described in the
Prospectus. You will not withhold placing customers' orders so as to
profit yourself as a result of such withholding (for example, by a
change in a Portfolio's net asset value from that used in determining
the offering price to your customers).
(d) We will accept your purchase orders only at the public offering
price applicable to each order, as determined in accordance with the
Prospectus. We will not accept from you a conditional order for
Portfolio shares. All orders are subject to acceptance or rejection
by us in our sole discretion. We may, without notice, suspend sales
or withdraw the offering of Portfolio shares, or make a limited
offering of Portfolio shares.
(e) The placing of orders with us will be governed by instructions
that we will periodically issue to you. You must pay for Portfolio
shares in New York or Boston clearing house funds or in federal funds
in accordance with such instructions, and we must receive your payment
on or before the settlement date established in accordance with Rule
15c6-1 under the 1934 Act. If we do not receive your payment on or
before such settlement date, we may, without notice, cancel the sale,
or, at our option, sell the shares that you ordered back to the
issuing Portfolio, and we may hold you responsible for any loss
suffered by us or the issuing Portfolio as a result of your failure to
make payment as required.
(f) You agree to comply with all applicable state and federal laws
and with the rules and regulations of authorized regulatory agencies
thereunder. You agree to offer and sell Portfolio shares only in
states where you may legally offer and sell such Portfolio's shares.
You will not offer shares of any Portfolio for sale unless such shares
are registered for sale under the applicable state and federal laws
and the rules and regulations thereunder.
(g) Certificates evidencing Portfolio shares are not available; any
transaction in Portfolio shares will be effected and evidenced by
book-entry on the records maintained by Fidelity Investments
Institutional Operations Company, Inc. ("FIIOC"). A confirmation
statement evidencing transactions in Portfolio shares will be
transmitted to you.
(h) You may designate FIIOC to execute your customers' transactions
in Portfolio shares in accordance with the terms of any account,
program, plan, or service established or used by your customers, and
to confirm each transaction to your customers on your behalf on a
fully disclosed basis. At the time of the transaction, you guarantee
the legal capacity of your customers and any co-owners of such shares
so transacting in such shares.
3. Your Compensation: (a) Your concession, if any, on your sales of
Portfolio shares will be as provided in the Prospectus or in the
applicable schedule of concessions issued by us and in effect at the
time of our sale to you. Upon written notice to you, we or any
Portfolio may change or discontinue any schedule of concessions, or
issue a new schedule.
(b) If a Portfolio has adopted a plan pursuant to Rule 12b-1 under
the Investment Company Act of 1940 (a "Plan"), we may make
distribution payments or service payments to you under the Plan. If a
Portfolio does not have a currently effective Plan, we or Fidelity
Management & Research Company may make distribution payments or
service payments to you from our own funds. Any distribution payments
or service payments will be made in the amount and manner set forth in
the Prospectus or in the applicable schedule of distribution payments
or service payments issued by us and then in effect. Upon written
notice to you, we or any Portfolio may change or discontinue any
schedule of distribution payments or service payments, or issue a new
schedule. A schedule of distribution payments or service payments
will be in effect with respect to a Portfolio that has a Plan only so
long as that Portfolio's Plan remains in effect.
(c) Concessions, distribution payments, and service payments apply
only with respect to (i) shares of the "Fidelity Funds" (as designated
on Schedule A attached to this Agreement) purchased or maintained for
the account of Bank Clients, and (ii) shares of the "Fidelity Advisor
Funds" (as designated on Schedule B attached to this Agreement).
Anything to the contrary notwithstanding, neither we nor any Portfolio
will provide to you, nor may you retain, concessions on your sales of
shares of, or distribution payments or service payments with respect
to assets of, the Fidelity Funds attributable to you or any of your
clients, other than Bank Clients. When you place an order in shares
of the Fidelity Funds with us, you will identify the Bank on behalf of
whose Clients you are placing the order; and you will identify as a
non-Bank Client Order, any order in shares of the Fidelity Funds
placed for the account of a non-Bank Client.
(d) After the effective date of any change in or discontinuance of
any schedule of concessions, distribution payments, or service
payments, or the termination of a Plan, any concessions, distribution
payments, or service payments will be allowable or payable to you only
in accordance with such change, discontinuance, or termination. You
agree that you will have no claim against us or any Portfolio by
virtue of any such change, discontinuance, or termination. In the
event of any overpayment by us of any concession, distribution
payment, or service payment, you will remit such overpayment.
(e) If any Portfolio shares sold to you by us under the terms of
this Agreement are redeemed by the issuing Portfolio or tendered for
redemption by the customer within seven (7) business days after the
date of our confirmation of your original purchase order for such
shares, you agree (i) to refund promptly to us the full amount of any
concession, distribution payment, or service payment allowed or paid
to you on such shares, and (ii) if not yet allowed or paid to you, to
forfeit the right to receive any concession, distribution payment, or
service payment allowable or payable to you on such shares. We will
notify you of any such redemption within ten (10) days after the date
of the redemption.
4. Certain Types of Accounts: (a) You may instruct FIIOC to
register purchased shares in your name and account as nominee for your
customers. If you hold Portfolio shares as nominee for your
customers, all Prospectuses, proxy statements, periodic reports, and
other printed material will be sent to you, and all confirmations and
other communications to shareholders will be transmitted to you. You
will be responsible for forwarding such printed material,
confirmations, and communications, or the information contained
therein, to all customers for whose account you hold any Portfolio
shares as nominee. However, we or FIIOC on behalf of itself or the
Portfolios will be responsible for the costs associated with your
forwarding such printed material, confirmations, and communications.
You will be responsible for complying with all reporting and tax
withholding requirements with respect to the customers for whose
account you hold any Portfolio shares as nominee.
(b) With respect to accounts other than those accounts referred to
in paragraph 4(a) above, you agree to provide us with all information
(including certification of taxpayer identification numbers and
back-up withholding instructions) necessary or appropriate for us to
comply with legal and regulatory reporting requirements.
(c) Accounts opened or maintained pursuant to the NETWORKING system
of the National Securities Clearing Corporation ("NSCC") will be
governed by applicable NSCC rules and procedures and any agreement or
other arrangement with us relating to NETWORKING.
(d) If you hold Portfolio shares in an omnibus account for two or
more customers, you will be responsible for determining, in accordance
with the Prospectus, whether, and the extent to which, a CDSC is
applicable to a purchase of Portfolio shares from such a customer, and
you agree to transmit immediately to us any CDSC to which such
purchase was subject. You hereby represent that if you hold Portfolio
shares subject to a CDSC, you have the capability to track and account
for such charge, and we reserve the right, at our discretion, to
verify that capability by inspecting your tracking and accounting
system or otherwise.
5. Status as Registered Broker/Dealer: (a) Each party to this
Agreement represents to the other party that (i) it is registered as a
broker/dealer under the 1934 Act, (ii) it is qualified to act as a
broker/dealer in the states where it transacts business, and (iii) it
is a member in good standing of the National Association of Securities
Dealers, Inc. ("NASD"). Each party agrees to maintain its
broker/dealer registration and qualifications and its NASD membership
in good standing throughout the term of this Agreement. Each party
agrees to abide by all of the NASD's rules and regulations, including
the NASD's Conduct Rules -- in particular, Section 2830 of such Rules,
which section is deemed a part of and is incorporated by reference in
this Agreement. This Agreement will terminate automatically without
notice in the event that either
party's NASD membership is terminated.
(b) Nothing in this Agreement shall cause you to be our partner,
employee, or agent, or give you any authority to act for us or for any
Portfolio. Neither we nor any Portfolio shall be liable for any of
your acts or obligations as a dealer under this Agreement.
6. Information Relating to the Portfolios: (a) No person is
authorized to make any representations concerning shares of a
Portfolio other than those contained in the Portfolio's Prospectus.
In buying Portfolio shares from us under this Agreement, you will rely
only on the representations contained in the Prospectus. Upon your
request, we will furnish you with a reasonable number of copies of the
Portfolios' current prospectuses or statements of additional
information or both (including any stickers thereto).
(b) Any printed or electronic information that we furnish you
(other than the Portfolios' Prospectuses and periodic reports) is our
sole responsibility and not the responsibility of the respective
Portfolios. You agree that the Portfolios will have no liability or
responsibility to you with respect to any such printed or electronic
information. We or the respective Portfolio will bear the expense of
qualifying its shares under the state securities laws.
(c) You may not use any sales literature or advertising material
(including material disseminated through radio, television, or other
electronic media) concerning Portfolio shares, other than the printed
or electronic information referred to in paragraph 6(b) above, in
connection with the offer or sale of Portfolio shares without
obtaining our prior written approval. You may not distribute or make
available to investors any information that we furnish you marked "FOR
DEALER USE ONLY" or that otherwise indicates that it is confidential
or not intended to be distributed to investors.
7. Indemnification: (a) We will indemnify and hold you harmless
from any claim, demand, loss, expense, or cause of action resulting
from the misconduct or negligence, as measured by industry standards,
of us, our agents and employees, in carrying out our obligations under
this Agreement. Such indemnification will survive the termination of
this Agreement.
(b) You will indemnify and hold us harmless from any claim, demand,
loss, expense, or cause of action resulting from the misconduct or
negligence, as measured by industry standards, of you, your agents and
employees, in carrying out your obligations under this Agreement.
Such indemnification will survive the termination of this Agreement.
8. Customer Lists: We hereby agree that we shall not use any list of
your customers which may be obtained in connection with this Agreement
for the purpose of solicitation of any product or service without your
express written consent. However, nothing in this paragraph or
otherwise shall be deemed to prohibit or restrict us or our affiliates
in any way from solicitations of any product or service directed at,
without limitation, the general public, any segment thereof, or any
specific individual, provided such solicitation is not based upon such
list.
9. Duration of Agreement: This Agreement, with respect to any Plan,
will continue in effect for one year from its effective date, and
thereafter will continue automatically for successive annual periods;
provided, however, that such continuance is subject to termination at
any time without penalty if a majority of a Portfolio's Trustees who
are not interested persons of the Portfolio (as defined in the
Investment Company Act of 1940 (the "1940 Act")), or a majority of the
outstanding shares of the Portfolio, vote to terminate or not to
continue the Plan. This Agreement, other than with respect to a Plan,
will continue in effect from year to year after its effective date,
unless terminated as provided herein.
10. Amendment and Termination of Agreement: (a) We may amend any
provision of this Agreement by giving you written notice of the
amendment. Either party to this Agreement may terminate the Agreement
without cause by giving the other party at least thirty (30) days'
written notice of its intention to terminate. This Agreement will
terminate automatically in the event of its assignment (as defined in
the 1940 Act).
(b) In the event that (i) an application for a protective decree
under the provisions of the Securities Investor Protection Act of 1970
is filed against you; (ii) you file a petition in bankruptcy or a
petition seeking similar relief under any bankruptcy, insolvency, or
similar law, or a proceeding is commenced against you seeking such
relief; or (iii) you are found by the SEC, the NASD, or any other
federal or state regulatory agency or authority to have violated any
applicable federal or state law, rule or regulation arising out of
your activities as a broker/dealer or in connection with this
Agreement, this Agreement will terminate effective immediately upon
our giving notice of termination to you. You agree to notify us
promptly and to immediately suspend sales of Portfolio shares in the
event of any such filing or violation, or in the event that you cease
to be a member in good standing of the NASD.
(c) Your or our failure to terminate this Agreement for a
particular cause will not constitute a waiver of the right to
terminate this Agreement at a later date for the same or another
cause. The termination of this Agreement with respect to any one
Portfolio will not cause its termination with respect to any other
Portfolio.
11. Arbitration: In the event of a dispute, such dispute will be
settled by arbitration before arbitrators sitting in Boston,
Massachusetts in accordance with the NASD's Code of Arbitration
Procedure in effect at the time of the dispute. The arbitrators will
act by majority decision and their award may allocate attorneys' fees
and arbitration costs between us. Their award will be final and
binding between us, and such award may be entered as a judgment in any
court of competent jurisdiction.
12. Notices: All notices required or permitted to be given under this
Agreement shall be given in writing and delivered by personal
delivery, by postage prepaid mail, or by facsimile machine or a
similar means of same day delivery (with a confirming copy by mail).
All notices to us shall be given or sent to us at our offices located
at 82 Devonshire Street, Mail Zone L12A, Boston, Massachusetts 02109,
Attn: Bank Wholesale Market. All notices to you shall be given or
sent to you at the address specified by you below. Each of us may
change the address to which notices shall be sent by giving notice to
the other party in accordance with this paragraph 11.
13. Miscellaneous: This Agreement, as it may be amended from time to
time, shall become effective as of the date when it is accepted and
dated below by us. This Agreement is to be construed in accordance
with the laws of the Commonwealth of Massachusetts. This Agreement
supersedes and cancels any prior agreement between us, whether oral or
written, relating to the sale of shares of the Portfolios or any other
subject covered by this Agreement. The captions in this Agreement are
included for convenience of reference only and in no way define or
limit any of the provisions of this Agreement or otherwise affect
their construction or effect.
Very truly yours,
FIDELITY DISTRIBUTORS
CORPORATION
Please return two signed copies of this Agreement to Fidelity
Distributors Corporation. Upon acceptance, one countersigned copy
will be returned to you for your files.
_____________________________________
Name of Firm
Address: _____________________________
_____________________________________
_____________________________________
By __________________________________
Authorized Representative
_____________________________________
Name and Title (please print or type)
CRD # _______________________________
ACCEPTED AND AGREED:
FIDELITY DISTRIBUTORS CORPORATION
By __________________________________
Dated: ________________
** DISCARD THIS PAGE AND ATTACH REVISED SCHEDULES A AND B **
Exhibit g(13)
Form of
FIDELITY GROUP
REPO CUSTODIAN AGREEMENT
FOR JOINT TRADING ACCOUNT
AGREEMENT dated as of ______, among THE BANK OF NEW YORK, a banking
corporation organized under the laws of the State of New York ("Repo
Custodian"), J.P. MORGAN SECURITIES INC. ("Seller") and each of the
entities listed on Schedule A-1, A-2, A-3 and A-4 (collectively, the
"Funds" and each a "Fund") hereto, acting on behalf of itself or (i)
in the case of the Funds listed on Schedule A-1 or A-2 hereto which
are portfolios or series, acting through the series company listed on
Schedule A-1 or A-2 hereto, (ii) in the case of the accounts listed on
Schedule A-3 hereto, acting through Fidelity Management & Research
Company, and (iii) in the case of the commingled or individual
accounts listed on Schedule A-4 hereto, acting through Fidelity
Management Trust Company (collectively, the "Funds" and each, a
"Fund").
WITNESSETH
WHEREAS, each of the Funds has entered into a master repurchase
agreement dated as of ___________, (the "Master Agreement") with
Seller pursuant to which from time to time one or more of the Funds,
as buyers, and Seller, as seller, may enter into repurchase
transactions effected through one or more joint trading accounts
(collectively, the "Joint Trading Account") established and
administered by one or more custodians of the Funds identified on
Schedule C hereto (each a "Custodian"); and,
WHEREAS, in each such repurchase transaction Seller will sell to such
Funds certain Securities (as hereinafter defined) selected from
Eligible Securities (as hereinafter defined) held by Repo Custodian,
subject to an agreement by Seller to repurchase such Securities; and
WHEREAS, Repo Custodian currently maintains a cash and securities
account (the "Seller Account") for Seller for the purpose of, among
other things, effecting repurchase transactions hereunder; and
WHEREAS, the Funds desire that the Repo Custodian serve as the
custodian for the Funds in connection with the repurchase transactions
effected hereunder, and that the Repo Custodian hold cash, Cash
Collateral (as hereinafter defined) and Securities for the Funds for
the purpose of effecting repurchase transactions hereunder.
NOW THEREFORE, the parties hereto hereby agree as follows:
1. Definitions.
Whenever used in this Agreement, the following terms shall have the
meanings set forth below:
(a) "Banking Day" shall mean any day on which the Funds, Seller
Custodian, Repo Custodian, and the Federal Reserve Banks where the
Custodian and the Repo Custodian are located, are each open for
business.
(b) "Cash Collateral" shall mean all cash, denominated in U.S.
Dollars, credited by Repo Custodian to a Transaction Account pursuant
to Paragraphs 3, 6, 8 or 9 of the Master Agreement.
(c) "Custodian" shall have the meaning set forth in the preamble of
this Agreement.
(d) "Eligible Securities" shall mean those securities which are
identified as permissible securities for a particular Transaction
Category.
(e) "FICASH I Transaction" and "FICASH III Transaction " shall mean a
repurchase transaction in which the Repurchase Date is the Banking Day
next following the Sale Date and for which securities issued by the
government of the United States of America that are direct obligations
of the government of the United States of America shall constitute
Eligible Securities.
(f) "FICASH II Transaction" shall mean a repurchase transaction in
which the Repurchase Date is the Banking Day next following the Sale
Date and for which one or more of the following two categories of
securities, as specified by the Funds, shall constitute Eligible
Securities: (x) securities issued by the government of the United
States of America that are direct obligations of the government of the
United States of America, or (y) securities issued by or guaranteed as
to principal and interest by the government of the United States of
America, or by its agencies and/or instrumentalities, including, but
not limited to, the Federal Home Loan Bank, Federal Home Loan Mortgage
Corp., Government National Mortgage Association, Federal National
Mortgage Association, Federal Farm Credit Bank, Federal Intermediate
Credit Bank, Banks for Cooperatives, and Federal Land Banks.
(g) "FITERM I Transaction" and "FITERM III Transaction" shall mean a
repurchase transaction in which the Repurchase Date is a date fixed by
agreement between Seller and the Participating Funds which is not the
Banking Day next following the Sale Date and for which securities
issued by the government of the United States of America that are
direct obligations of the government of the United States of America
shall constitute Eligible Securities.
(h) "FITERM II Transaction" shall mean a repurchase transaction in
which the Repurchase Date is a date fixed by agreement between Seller
and the Participating Funds which is not the Banking Day next
following the Sale Date and for which one or more of the following two
categories of securities, as specified by the Funds, shall constitute
Eligible Securities: (x) securities issued by the government of the
United States of America that are direct obligations of the government
of the United States of America, or (y) securities issued by or
guaranteed as to principal and interest by the government of the
United States of America, or by its agencies and/or instrumentalities,
including, but not limited to, the Federal Home Loan Bank, Federal
Home Loan Mortgage Corp., Government National Mortgage Association,
Federal National Mortgage Association, Federal Farm Credit Bank,
Federal Intermediate Credit Bank, Banks for Cooperatives, and Federal
Land Banks.
(i) "Fund" shall have the meaning set forth in the preamble of this
Agreement.
(j) "Fund Agent" shall mean the agent for the Participating Funds
designated in Paragraph 18 of the Master Agreement.
(k) "Joint Trading Account" shall have the meaning set forth in the
preamble of this Agreement.
(l) "Margin Percentage" with respect to any repurchase transaction
shall be 102% or such other percentage as is agreed to by Seller and
the Participating Funds (except that in no event shall the Margin
Percentage be less than 100%).
(m) "Market Value" shall have the meaning set forth in Paragraph 4 of
the Master Agreement.
(n) "Master Agreement" shall have the meaning set forth in the
preamble of this Agreement.
(o) "1940 Act" shall mean have the meaning set forth in Paragraph
3(c) of this Agreement.
(p) "Partial Payment" shall have the meaning set forth in Section
4(g) of this Agreement.
(q) "Participating Funds" shall mean those Funds that are parties to
a particular repurchase transaction effected through the Joint Trading
Account.
(r) "Pricing Rate" shall mean the per annum percentage rate agreed to
by Seller and the Participating Funds for a repurchase transaction.
(s) "Pricing Services" shall have the meaning set forth in Paragraph
7 of this Agreement.
(t) "Repo Custodian" shall have the meaning set forth in the preamble
of this Agreement.
(u) "Repurchase Date" shall mean the date fixed by agreement between
Seller and the Participating Funds on which the Seller is to
repurchase Securities and Cash Collateral, if any, from the
Participating Funds and the Participating Funds are to resell the
Securities and Cash Collateral, if any, including any date determined
by application of the provisions of Paragraphs 7 and 15 of the Master
Agreement.
(v) "Repurchase Price" for each repurchase transaction shall mean the
Sale Price, plus an incremental amount determined by applying the
Pricing Rate to the Sale Price, calculated on the basis of a 360-day
year and the number of actual days elapsed from (and including) the
Sale Date to (but excluding) the Repurchase Date.
(w) "Sale Date" shall mean the Banking Day on which Securities and
Cash Collateral, if any, are to be sold to the Participating Funds by
Seller pursuant to a repurchase transaction hereunder.
(x) "Sale Price" shall mean the price agreed upon by the
Participating Funds and Seller at which the Securities and Cash
Collateral, if any, are to be sold to the Participating Funds by
Seller.
(y) "Securities" shall mean all Eligible Securities delivered by
Seller or to be delivered by Seller to the Participating Funds
pursuant to a particular repurchase transaction and not yet
repurchased hereunder, together with all rights related thereto and
all proceeds thereof.
(z) "Securities System" shall have the meaning set forth in Paragraph
3(c) of this Agreement.
(aa) "Seller" shall have the meaning set forth in the preamble to
this Agreement.
(bb) "Seller Account" shall have the meaning set forth in the
preamble of this Agreement.
(cc) "Transaction Account" shall mean a cash account established and
maintained by Repo Custodian for the Funds to effect repurchase
transactions pursuant to the Master Agreement.
(dd) "Transaction Category" shall mean the particular type of
repurchase transaction effected hereunder, as determined with
reference to the term of the transaction and the categories of
Securities that constitute Eligible Securities therefor, which term
shall include FICASH I Transactions, FICASH II Transactions, FICASH
III Transactions, FITERM I Transactions, FITERM II Transactions,
FITERM III Transactions, and such other transaction categories as may
from time to time be designated by the Funds by notice to Seller,
Custodian and Repo Custodian.
2. Appointment of Repo Custodian. Upon the terms and conditions set
forth in this Agreement, Repo Custodian is hereby appointed by the
Funds to act as the custodian for the Participating Funds to hold
cash, Cash Collateral and Securities for the purpose of effecting
repurchase transactions for the Participating Funds through the Joint
Trading Account pursuant to the Master Agreement. Repo Custodian
hereby acknowledges the terms of the Master Agreement between the
Funds and Seller (attached as an Exhibit hereto), as amended from time
to time, and agrees to abide by the provisions thereof to the extent
such provisions relate to the responsibilities and operations of Repo
Custodian hereunder.
3. Maintenance of Transaction Accounts.
(a) Repo Custodian shall establish and maintain one or more
Transaction Accounts for the purpose of effecting repurchase
transactions hereunder for the Funds, in each case pursuant to the
Master Agreement. From time to time the Funds may cause Custodian, on
behalf of the Funds, to deposit Securities and cash with Repo
Custodian in the designated Transaction Account, in each case in
accordance with Paragraph 3 of the Master Agreement.
(b) Repo Custodian shall keep all Securities, cash and Cash
Collateral received for the Participating Funds segregated at all
times from those of any other person, firm or corporation in its
possession and shall identify all such Securities, cash and Cash
Collateral as subject to this Agreement and the Master Agreement.
Segregation may be accomplished by physical segregation with respect
to certificated securities held by the Repo Custodian and, in
addition, by appropriate identification on the books and records of
Repo Custodian in the case of all other Securities, cash and Cash
Collateral. Title to all Securities and Cash Collateral under a
repurchase transaction shall pass to the Participating Funds that are
parties to such repurchase transaction. All such Securities and Cash
Collateral shall be held by Repo Custodian for the Participating
Funds, and shall be subject at all times to the proper instructions of
the Participating Funds, or the Custodian on behalf of the
Participating Funds, with respect to the holding, transfer or
disposition of such Securities and Cash Collateral. Repo Custodian
shall include in its records for each Transaction Account all
instructions received by it which evidence an interest of the
Participating Funds in the Securities and Cash Collateral and shall
hold physically segregated any written agreement, receipt or other
writing received by it which evidences an interest of the
Participating Funds in the Securities and Cash Collateral.
(c) Any requirement to "deliver" or "transfer" cash or Cash
Collateral to the Participating Funds or to "credit" a Transaction
Account under this or any other paragraph of this Agreement shall be
made in immediately available funds. If Repo Custodian is required to
"deliver" or "transfer" Securities to the Participating Funds under
this or any other paragraph of this Agreement, Repo Custodian shall
take, or cause to be taken, the following actions to perfect the
Participating Funds' interest in such Securities as an outright
purchaser: (i) in the case of certificated securities and instruments
held by Seller, by physical delivery of the share certificates or
other instruments representing the Securities and by physical
segregation of such certificates or instruments from the Repo
Custodian's other assets in a manner indicating that the Securities
are being held for the Participating Funds (such securities and
instruments to be delivered in form suitable for transfer or
accompanied by duly executed instruments of transfer or assignment in
blank and accompanied by such other documentation as the Participating
Funds may request), (ii) in the case of Securities held in a customer
only account in a clearing agency or federal book-entry system
authorized for use by the Funds and meeting the requirements of Rule
17f-4 under the Investment Company Act of 1940, as amended (the "1940
Act") (such authorized agency or system being referred to herein as a
"Securities System"), by appropriate entry on the books and records of
Repo Custodian identifying the Securities as belonging to the
Participating Funds, or (iii) in the case of Securities held in Repo
Custodian's own account in a Securities System, by transfer to a
customer only account in the Securities System and by appropriate
entry on the books and records of Repo Custodian identifying such
Securities as belonging to the Participating Funds; provided, further,
that Repo Custodian shall confirm to the Participating Funds the
identity of the Securities transferred or delivered. Acceptance of a
"due bill", "trust receipt" or similar receipt or notification of
segregation issued by a third party with respect to Securities held by
such third party shall not constitute good delivery of Securities to
Repo Custodian for purposes of this Agreement or the Master Agreement
and shall expressly violate the terms of this Agreement and the Master
Agreement. The Funds shall identify by notice to Repo Custodian and
Seller those agencies or systems which have been approved by the Funds
for use under this Agreement and the Master Agreement. The Funds
hereby notify Repo Custodian and Seller that the following agencies
and systems have been approved by the Funds for use under this
Agreement and the Master Agreement, until such time as Repo Custodian
and Seller shall have been notified by the Funds to the contrary: (i)
Participants Trust Company; (ii) The Depository Trust Company; and
(iii) any book-entry system as provided in (A) Subpart O of Treasury
Circular No. 300, 31 CFR 306.115, (B) Subpart B of Treasury Circular
Public Debt Series No. 27-76, 31 CFR 350.2, or (C) the book-entry
regulations of federal agencies substantially in the form of 31 CFR
306.115.
4. Repurchase Transactions.
(a) Repo Custodian shall make all credits and debits to the
Transaction Account and effect the transfer of Securities to or from
the Participating Funds upon proper instructions received from the
Participating Funds, or the Custodian on behalf of the Participating
Funds, and shall make all credits and debits to the Seller Account and
effect the transfer of Securities to or from the Seller upon proper
instructions received from Seller. In the event that Repo Custodian
receives conflicting proper instructions from Seller and the
Participating Funds, or the Custodian on behalf of the Participating
Funds, Repo Custodian shall follow the Participating Funds' or the
Custodian's proper instructions. The Participating Funds shall give
Repo Custodian only such instructions as shall be permitted by the
Master Agreement. Notwithstanding the preceding sentence, the
Participating Funds, or the Custodian on behalf of the Participating
Funds, may from time to time instruct Repo Custodian to transfer cash
from the Transaction Account to Custodian.
(b) (i) Whenever on any Banking Day one or more Funds and Seller agree
to enter into a repurchase transaction, Seller and the Participating
Funds, or the Custodian on behalf of the Participating Funds, will
give Repo Custodian proper instructions by telephone or otherwise on
the Sale Date, specifying the Transaction Category, Repurchase Date,
Sale Price, Repurchase Price or the applicable Pricing Rate and the
Margin Percentage for each such repurchase transaction.
(ii) In the case of repurchase transactions in which the Repurchase
Date is the Banking Day next following the Sale Date (x) the
Participating Funds may increase or decrease the Sale Price for any
such repurchase transaction by no more than 10% of the initial Sale
Price by causing to be delivered further proper instructions by
telephone or otherwise to Repo Custodian prior to the close of
business on the Sale Date and (y) Seller and the Participating Funds
may by mutual consent agree to increase or decrease the Sale Price by
more than 10% of the initial Sale Price by causing to be provided
further proper instructions to Repo Custodian by the close of business
on the Sale Date. In any event, Repo Custodian shall not be
responsible for determining whether any such increase or decrease of
the Sale Price exceeds the 10% limitation.
(c) Seller will take such actions as are necessary to ensure that on
the Sale Date the aggregate Market Value of all Securities held by
Repo Custodian for Seller and cash in the Seller Account equals or
exceeds the Margin Percentage of the Sale Price. Seller shall give
Repo Custodian proper instructions specifying with respect to each of
the Securities which is to be the subject of a repurchase transaction
(a) the name of the issuer and the title of the Securities, and (b)
the Market Value of such Securities. Such instructions shall
constitute Seller's instructions to Repo Custodian to transfer the
Securities to the Participating Funds and/or Cash Collateral from the
Seller Account to the Transaction Account.
(d) Prior to the close of business on the Sale Date, the
Participating Funds shall transfer to, or maintain on deposit with,
Repo Custodian in the Transaction Account immediately available funds
in an amount equal to the Sale Price with respect to a particular
repurchase transaction.
(e) Prior to the close of business on the Sale Date, Repo Custodian
shall transfer Securities from Seller to the Participating Funds
and/or cash held in the Seller Account to the Transaction Account and
shall transfer to the Seller Account immediately available funds from
the Transaction Account in accordance with the following provisions:
(i) Repo Custodian shall determine that all securities to be
transferred by Seller to the Participating Funds are Eligible
Securities. Any securities which are not Eligible Securities for a
particular repurchase transaction hereunder shall not be included in
the calculations set forth below and shall not be transferred to the
Participating Funds.
(ii) Repo Custodian shall then calculate the aggregate Market Value
of the Securities and cash, if any, to be so transferred.
(iii) Repo Custodian shall notify Seller in the event that the
aggregate Market Value of Securities and cash, if any, applicable to
the repurchase transaction is less than the Margin Percentage of the
Sale Price and Seller shall transfer, by the close of business on the
Sale Date, to Repo Custodian additional Securities and/or cash in the
amount of such deficiency. If Seller does not, by the close of
business on the Sale Date, transfer additional Securities and/or cash,
the Market Value of which equals or exceeds such deficiency, Repo
Custodian may, at its option, without notice to Seller, advance the
amount of such deficiency to Seller in order to effectuate the
repurchase transaction. It is expressly agreed that Repo Custodian is
not obligated to make an advance to Seller to enable it to complete
any repurchase transaction.
(iv) Subject to the provisions of Subparagraph (v) below, Repo
Custodian shall cause the Securities applicable to the repurchase
transaction received from Seller to be transferred to the
Participating Funds and shall cause any cash received from Seller to
be transferred to the Transaction Account, against transfer of the
Sale Price from the Transaction Account to the Seller Account, such
transfers of Securities and/or cash and funds to occur simultaneously
on a delivery versus payment basis.
(v) Notwithstanding anything to the contrary, if, for any repurchase
transaction, the amount of immediately available funds in the
Transaction Account is less than the agreed upon Sale Price in
connection with the repurchase transaction immediately prior to
effectuating such repurchase transaction, or if the aggregate Market
Value of the Securities and cash, if any, applicable to such
repurchase transaction is less than the Sale Price multiplied by the
Margin Percentage immediately prior to effectuating such repurchase
transaction, Repo Custodian shall effect the repurchase transaction to
the best of its ability by transferring Securities from Seller to the
Participating Funds and/or cash from the Seller Account to the
Transaction Account with an aggregate Market Value equal to the lesser
of (x) the amount of immediately available funds in the Transaction
Account multiplied by the Margin Percentage and (y) the aggregate
Market Value of the Securities available for transfer from Seller to
the Participating Funds and cash, if any, in the Seller Account,
against the transfer of immediately available funds from the
Transaction Account to the Seller Account in an amount equal to the
aggregate Market Value of the Securities and/or cash to be transferred
divided by the Margin Percentage; provided, however, that in either
such event Repo Custodian shall have the right not to transfer to the
Participating Funds such Securities and not to transfer such cash, if
any, to the Transaction Account and not to transfer from the
designated Transaction Account such funds as Repo Custodian
determines, in its sole discretion, will not be the subject of a
repurchase transaction. The actions of Repo Custodian pursuant to
this subparagraph (e)(v) shall not affect the obligations and
liabilities of the parties to each other pursuant to the Master
Agreement with regard to such repurchase transaction.
(f) In the event that on a Banking Day Seller desires to substitute
Securities applicable to such repurchase transaction with Eligible
Securities and/or Cash Collateral (to the extent provided in the
Master Agreement), Repo Custodian shall perform such substitution in
accordance with the following provisions:
(i) Repo Custodian shall determine that all securities to be
transferred to the Participating Funds are Eligible Securities. Any
securities which are not eligible for repurchase transactions
hereunder shall not be included in the calculations set forth below
and shall not be transferred to the Participating Funds.
(ii) Repo Custodian shall then calculate the aggregate Market Value
of the Eligible Securities and/or Cash Collateral to be transferred.
Repo Custodian shall not make any substitution if, at the time of
substitution, the aggregate Market Value of all Securities and any
Cash Collateral applicable to such repurchase transaction immediately
after such substitution would be less than the Margin Percentage of
the Repurchase Price (calculated as if the Repurchase Date were the
date of substitution).
(iii) Repo Custodian shall then deliver to the Seller, subject to the
qualifications set forth above, the Securities to be substituted
against the delivery by Repo Custodian of substitute Eligible
Securities to the Participating Funds and/or the crediting of the
Transaction Account with Cash Collateral.
(iv) In the event Seller has caused Repo Custodian to credit the
Transaction Account with Cash Collateral in lieu of substitute
Eligible Securities, and has failed to deliver Eligible Securities
against such Cash Collateral not later than the close of business on
such Banking Day in accordance with the terms of the Master Agreement,
Repo Custodian shall promptly, but in no event later than 10:00 a.m.
the following Banking Day, notify the Participating Funds and Seller
of such failure.
(g) With respect to each repurchase transaction, at 10:00 a.m. New
York time, or at such other time as specified in proper instructions
of the Participating Funds (or the Custodian on behalf of the
Participating Funds) on the Repurchase Date, Repo Custodian shall
debit the Seller Account and credit the Transaction Account in the
amount of the Repurchase Price and shall transfer Securities from the
Participating Funds to the Seller and Cash Collateral, if any, from
the Transaction Account to the Seller Account in accordance with the
following provisions:
(i) If the amount of available funds in the Seller Account equals or
exceeds the Repurchase Price, Repo Custodian shall debit the Seller
Account and credit the Transaction Account in the amount of the
Repurchase Price and shall transfer all Securities applicable to such
repurchase transaction from the Participating Funds to the Seller and
debit the Transaction Account and credit the Seller Account in the
amount of any Cash Collateral applicable to such repurchase
transaction.
(ii) If the amount of available funds in the Seller Account is less
than the Repurchase Price, then Repo Custodian shall notify the Seller
of the amount of the deficiency and Seller shall promptly cause such
amount to be transferred to the Seller Account. If Seller fails to
cause the transfer of the entire amount of the deficiency to the
Seller Account, then Repo Custodian may, at its option and without
notice to Seller, advance to Seller the amount of such remaining
deficiency. It is expressly agreed that Repo Custodian is not
obligated to make any advance to Seller. If, following such transfer
and/or advance, the amount of available funds in the Seller Account
equals or exceeds the Repurchase Price then Repo Custodian shall debit
the Seller Account and credit the Transaction Account in the amount of
the Repurchase Price and shall transfer from the Participating Funds
to the Seller all Securities applicable to such repurchase transaction
and debit the Transaction Account and credit the Seller Account in the
amount of any Cash Collateral applicable to such repurchase
transaction.
(iii) If the Seller fails to cause the transfer of the entire amount
of the deficiency, as required by (ii) above, and Repo Custodian fails
to advance to Seller an amount sufficient to eliminate the entire
deficiency, then Repo Custodian shall debit the Seller Account in the
amount of all immediately available funds designated by Seller as
applicable to the repurchase transaction and credit the Transaction
Account in such amount (such amount being referred to as the "Partial
Payment") and shall transfer Securities from the Participating Funds
to the Seller such that the aggregate Market Value of all remaining
Securities and Cash Collateral in the Transaction Account with respect
to such repurchase transaction shall at least equal the difference
between Margin Percentage of the Repurchase Price and the Partial
Payment.
5. Payments on Securities. Repo Custodian shall credit to the Seller
Account as soon as received, all principal, interest and other sums
paid by or on behalf of the issuer in respect of the Securities and
collected by Repo Custodian, except as otherwise provided in Paragraph
8 of the Master Agreement.
6. Daily Statement. On each Banking Day on which any Participating
Funds have an outstanding repurchase transaction, Repo Custodian shall
deliver by facsimile to Custodian and to the Participating Funds a
statement identifying the Securities held by Repo Custodian with
respect to such repurchase transaction and the cash and Cash
Collateral, if any, held by Repo Custodian in the Transaction Account,
including a statement of the then current Market Value of such
Securities and the amounts, if any, credited to the Transaction
Account as of the close of trading on the previous Banking Day. Repo
Custodian shall also deliver to Custodian and the Participating Funds
such additional statements as the Participating Funds may reasonably
request.
7. Valuation.
(a) Repo Custodian shall confirm the Market Value of Securities and
the amount of Cash Collateral, if any (i) on the Sale Date prior to
transferring the Sale Price out of the Transaction Account to the
Seller Account against the receipt from Seller of the Securities and
Cash Collateral, if any, and (ii) on each Banking Day on which such
repurchase transaction is outstanding. If on any Banking Day the
aggregate Market Value of the Securities and Cash Collateral with
respect to any repurchase transaction is less than the Margin
Percentage of the Repurchase Price (calculated as if the Repurchase
Date were such Banking Day) for such transaction, Repo Custodian shall
promptly, but in any case no later than 10:00 a.m. the following
Banking Day, notify Seller. If on any Banking Day the aggregate
market value of the Securities and Cash Collateral with respect to any
repurchase transaction is less than the Margin Percentage of the
Repurchase Price (calculated as if the Repurchase Date were such
Banking Day) for such transaction, and Seller fails to deliver
additional Eligible Securities applicable to such repurchase
transaction or an additional amount of Cash Collateral by the close of
business on such Banking Day such that the aggregate market value of
the Securities and Cash Collateral at least equals the Margin
Percentage of the Repurchase Price (calculated as if the Repurchase
Date were such Banking Day), Repo Custodian shall promptly, but in any
event no later than 10:00 a.m. the following Banking Day, notify the
Participating Funds of such failure. For purposes of determining
Seller's margin maintenance requirements on the Sale Date for
repurchase transactions in which the Repurchase Date is the Banking
Day immediately following the Sale Date, such aggregate market value
shall equal at least the Margin Percentage of the Sale Price.
(b) Repo Custodian shall determine the bid side portion of the Market
Value of the Securities by reference to the independent pricing
services ("Pricing Services") set forth on Schedule B. It is
understood and agreed that Repo Custodian shall use the prices made
available by the Pricing Services on the Banking Day of such
determination unless Seller and the Participating Funds mutually agree
that some other prices shall be used and so notify Repo Custodian by
proper instructions of the sum of the prices of all such Securities
priced in such different manner. In the event that Repo Custodian is
unable to obtain a valuation of any Securities from the Pricing
Services, Repo Custodian shall request a bid quotation from a broker's
broker or a broker dealer, set forth in Schedule B, other than Seller.
In the event Repo Custodian is unable to obtain a bid quotation for
any Securities from such a broker's broker or a broker dealer, Repo
Custodian (i) shall not include any such Securities in the
determination of whether the aggregate Market Value of the Securities
and any Cash Collateral equals at least the Margin Percentage of the
Repurchase Price and (ii) shall redeliver such Securities to Seller if
the Market Value of all other Securities and any Cash Collateral with
respect to such repurchase transaction equals at least the Margin
Percentage of the Repurchase Price (calculated as if the Repurchase
Date were such Banking Day). The Repo Custodian may rely on prices
quoted by Pricing Services, broker's brokers or broker dealers, except
Seller, as set forth in Schedule B.
(c) (i) If, on any Banking Day, the aggregate Market Value of the
Securities and any Cash Collateral with respect to a repurchase
transaction is less than the Margin Percentage of the Repurchase Price
(calculated as if the Repurchase Date were such Banking Day)
applicable to such repurchase transaction, Repo Custodian shall
deliver to the Participating Funds an amount of additional Eligible
Securities applicable to such repurchase transaction and/or debit the
Seller Account and credit the Transaction Account with an additional
amount of Cash Collateral, such that the aggregate Market Value of all
Securities and any Cash Collateral with respect to such repurchase
transaction shall equal at least the Margin Percentage of the
Repurchase Price (calculated as if the Repurchase Date were such
Banking Day) applicable to such repurchase transaction; except that,
for purposes of determining Seller's margin maintenance requirements
on the Sale Date for repurchase transactions in which the Repurchase
Date is the Banking Day immediately following the Sale Date, such
aggregate market value shall equal at least the Margin Percentage of
the Sale Price.
(ii) If, on any Banking Day, the aggregate Market Value of the
Securities and any Cash Collateral with respect to a repurchase
transaction exceeds the Margin Percentage of the Repurchase Price
(calculated as if the Repurchase Date were such Banking Day)
applicable to such repurchase transaction, Repo Custodian shall return
to the Seller all or a portion of such Securities or Cash Collateral,
if any; provided that the Market Value of the remaining Securities and
any Cash Collateral with respect to the repurchase transaction shall
be at least equal to the Margin Percentage of the Repurchase Price
(calculated as if the Repurchase Date were such Banking Day)
applicable to such repurchase transaction. At any time and from time
to time with respect to any repurchase transaction, if authorized by
the Participating Funds, or the Custodian on behalf of the
Participating Funds, the Repo Custodian shall debit the Transaction
Account by an amount of Cash Collateral and credit the Seller Account
by the same amount of Cash Collateral against simultaneous delivery
from Seller to the Participating Funds of Eligible Securities
applicable to such repurchase transaction with a Market Value at least
equal to the amount of Cash Collateral credited and debited.
8. Authorized Persons. Schedule C hereto sets forth those persons
who are authorized to act for Repo Custodian, Custodian, Seller and
the Funds, respectively, under this Agreement.
9. Proper Instructions. Proper instructions shall mean a tested
telex, facsimile, a written request, direction, instruction or
certification signed or initialed by or on behalf of the party giving
the instructions by one or more authorized persons (as provided in
Paragraph 8); provided, however, that no instructions directing the
delivery of Securities or the payment of funds to any individual who
is an authorized signatory of Custodian or Repo Custodian shall be
signed by that individual. Telephonic, other oral or
electro-mechanical or electronic instructions (including the code
which may be assigned by Repo Custodian to Custodian from time to
time) given by one of the above authorized persons shall also be
considered proper instructions if the party receiving such
instructions reasonably believes them to have been given by an
authorized person with respect to the transaction involved. Oral
instructions will be confirmed by tested telex, facsimile or in
writing in the manner set forth above. The Funds authorize Repo
Custodian to tape record any and all telephonic or other oral
instructions given to Repo Custodian. Proper instructions may relate
to specific transactions or to types or classes of transactions, and
may be in the form of standing instructions.
10. Standard of Care.
(a) Repo Custodian shall be obligated to exercise reasonable care and
diligence in carrying out the provisions of this Agreement and the
Master Agreement and shall be liable to each of the Funds and Seller
for any expenses or damages to the Funds or Seller for breach of Repo
Custodian's standard of care in this Agreement, as further provided in
this Paragraph. Repo Custodian assumes responsibility for loss to any
property held by it pursuant to the provisions of this Agreement which
is occasioned by the negligence of, or conversion, misappropriation or
theft by, Repo Custodian's officers, employees and agents. Repo
Custodian, at its option, may insure itself against loss from any
cause but shall be under no obligation to obtain insurance directly
for the benefit of the Funds. So long as and to the extent that Repo
Custodian exercises reasonable care and diligence and acts without
negligence, misfeasance or misconduct, Repo Custodian shall not be
liable to Seller or the Funds for (i) any action taken or omitted in
good faith in reliance upon proper instructions, (ii) any action taken
or omitted in good faith upon any notice, request, certificate or
other instrument reasonably believed by it to be genuine and to be
signed by the proper party or parties, (iii) any delay or failure to
act as may be required under this Agreement or under the Master
Agreement when such delay or failure is due to any act of God or war,
(iv) the actions or omissions of a Securities System, (v) the title,
validity or genuineness of any security received, delivered or held by
it pursuant to this Agreement or the Master Agreement, (vi) the
legality of the purchase or sale of any Securities by or to the
Participating Funds or Seller or the propriety of the amount for which
the same are purchased or sold (except to the extent of Repo
Custodian's obligations hereunder to determine whether securities are
Eligible Securities and to calculate the Market Value of Securities
and any Cash Collateral), (vii) the due authority of any person listed
on Schedule C to act on behalf of Custodian, Seller or the Funds, as
the case may be, with respect to this Agreement or (viii) the errors
of the Pricing Services, broker's brokers or broker dealers set forth
in Schedule B.
(b) Repo Custodian shall not be liable to Seller or the Funds for, or
considered to be the custodian of, any Eligible Securities or any
money to be used in a repurchase transaction, whether or not such
money is represented by any check, draft, or other instrument for the
payment of money, until the Eligible Securities have been delivered in
accordance with Paragraph 3 or until Repo Custodian actually receives
and collects such money on behalf of Seller or the Funds directly or
by the final crediting of the Seller Account or a Transaction Account
through the Securities System, except that this Paragraph 10(b) shall
not be deemed to limit the liability of Repo Custodian to Seller or
the Funds if the non-delivery of such Eligible Securities or the
failure to receive and collect such money results from the breach by
Repo Custodian of its obligations under this Agreement or the Master
Agreement.
(c) Repo Custodian shall not be under any duty or obligation to
ascertain whether any Securities at any time delivered to or held by
it are such as properly may be held by the Participating Funds;
provided that notwithstanding anything to the contrary herein, Repo
Custodian shall be obligated to act in accordance with the guidelines
and proper instructions of the Participating Funds, or the Custodian
on behalf of the Participating Funds, with respect to the types of
Eligible Securities and the issuers of such Eligible Securities that
may be used in specific repurchase transactions.
(d) Repo Custodian promptly shall notify the Fund Agent and the
Custodian if Securities held by Repo Custodian are in default or if
payment on any Securities has been refused after due demand and
presentation and Repo Custodian shall take action to effect collection
of any such amounts upon the proper instructions of the Participating
Funds, or the Custodian on behalf of the Participating Funds, and
assurances satisfactory to it that it will be reimbursed for its costs
and expenses in connection with any such action.
(e) Repo Custodian shall have no duties, other than such duties as
are necessary to effectuate repurchase transactions in accordance with
this Agreement and the Master Agreement within the standard of care
set forth in Paragraph 10(a) above and in a commercially reasonable
manner.
11. Representations and Additional Covenants of Repo Custodian.
(a) Repo Custodian represents and warrants that (i) it is duly
authorized to execute and deliver this Agreement and to perform its
obligations hereunder and has taken all necessary action to authorize
such execution, delivery and performance, (ii) the execution, delivery
and performance of this Agreement do not and will not violate any
ordinance, declaration of trust, partnership agreement, articles of
incorporation, charter, rule or statute applicable to it or any
agreement by which it is bound or by which any of its assets are
affected, (iii) the person executing this Agreement on its behalf is
duly and properly authorized to do so, (iv) it has (and will maintain)
a copy of this Agreement and evidence of its authorization in its
official books and records, and (v) this Agreement has been executed
by one of its duly authorized officers at the level of Vice President
or higher.
(b) Repo Custodian further represents and warrants that (i) it has
not pledged, encumbered, hypothecated, transferred, disposed of, or
otherwise granted, any third party an interest in any Securities, (ii)
it does not have any security interest, lien or right of setoff in the
Securities, and (iii) it has not been notified by any third party, in
its capacity as Repo Custodian, custodian bank or clearing bank, of
the existence of any lien, claim, charge or encumbrance with respect
to any Securities that are the subject of such repurchase transaction.
Repo Custodian agrees that (i) it will not pledge, encumber,
hypothecate, transfer, dispose of, or otherwise grant, any third party
an interest in any Securities, (ii) it will not acquire any security
interest, lien or right of setoff in the Securities, and (iii) it will
promptly notify the Fund Agent, if, during the term of any outstanding
repurchase transaction, it is notified by any third party, in its
capacity as Repo Custodian, custodian bank or clearing bank, of the
Participating Funds or Seller, of the existence of any lien, claim,
charge or encumbrance with respect to any Securities that are the
subject of such repurchase transaction.
12. Indemnification.
(a) Notwithstanding the Participating Fund's obligation to the Repo
Custodian under Paragraph 12(b) below, so long as and to the extent
that Repo Custodian is in the exercise of reasonable care and
diligence and acts without negligence, misfeasance or misconduct,
Seller will indemnify Repo Custodian and hold it harmless against any
and all losses, claims, damages, liabilities or actions to which it
may become subject, and reimburse it for any expenses (including
attorneys' fees and expenses) incurred by it in connection therewith,
insofar as such losses, claims, damages, liabilities or actions arise
out of or are based upon or in any way related to this Agreement, the
Master Agreement or those arrangements. Without limiting the
generality of the foregoing indemnification, Repo Custodian shall be
indemnified by Seller for all costs and expenses, including attorneys'
fees, for its successful defense against claims that Repo Custodian
breached its standard of care and was negligent or engaged in
misfeasance or misconduct.
(b) So long as and to the extent that Repo Custodian is in the
exercise of reasonable care and diligence and acts without negligence,
misconduct or misfeasance, the Participating Funds will indemnify Repo
Custodian and hold it harmless against any and all losses, claims,
damages, liabilities or actions to which it may become subject, and
reimburse it for any expenses (including attorneys' fees and expenses)
incurred by it in connection therewith, insofar as such losses,
claims, damages, liabilities or actions result from the negligence,
misconduct or misfeasance of the Participating Funds under this
Agreement.
13. Rights and Remedies. The rights and remedies conferred upon the
parties hereto shall be cumulative, and the exercise or waiver of any
thereof shall not preclude or inhibit the exercise of any additional
rights and remedies.
14. Modification or Amendment. Except as otherwise provided in this
Paragraph 14, no modification, waiver or amendment of this Agreement
shall be binding unless in writing and executed by the parties hereto.
Schedule A, listing the Funds, may be amended from time to time to add
or delete Funds by the Funds (i) delivering an executed copy of an
addendum to Schedule A to Seller and Repo Custodian, and (ii)
amending Schedule A to the Master Agreement in accordance with the
provisions therein. The amendment of Schedule A as provided above
shall constitute appointment of Repo Custodian as a custodian for such
Fund. Schedule B may be amended from time to time by an instrument in
writing, or counterpart thereof, executed by Repo Custodian, Seller
and the Funds. Schedule C may be amended from time to time to change
an authorized person of: (i) the Funds, by written notice to Repo
Custodian and Seller by Ms. Sarah Zenoble or the Treasurer of the
Funds (or such persons who may be authorized from time to time in
writing by Ms. Zenoble or the President or Treasurer of Fidelity
Management and Research Company to trade on behalf of Fidelity's
taxable money market funds); (ii) Seller, by written notice to Repo
Custodian and the Funds by any Vice President of Seller; (iii) Repo
Custodian, by written notice to Seller, Custodian and the Funds by any
Vice President of Repo Custodian; and (iv) Custodian, by written
notice to Repo Custodian by any Vice President of Custodian. Schedule
D may be amended from time to time by any party hereto by delivery of
written notice to the other parties hereto. Repo Custodian shall
receive notice of any amendment to the Master Agreement at the address
set forth in Schedule D hereto; and, if such amendment would have a
material adverse effect on the rights of, or would materially increase
the obligations of Repo Custodian under this Agreement, any such
amendment shall also require the consent of Repo Custodian. Any such
amendment shall be deemed not to be material if Repo Custodian fails
to object in writing within 21 days after receipt of notice thereof.
No amendment to this Agreement shall affect the rights or obligations
of any Fund with respect to any outstanding repurchase transaction
entered into under this Agreement and the Master Agreement prior to
such amendment or with respect to any actions or omissions by any
party hereto prior to such amendment. In the event of conflict
between this Agreement and the Master Agreement, the Master Agreement
shall control.
15. Termination. This Agreement shall terminate forthwith upon
termination of the Master Agreement or may be terminated by any party
hereto on ten Banking Days' written notice to the other parties;
provided, however, that any such termination shall not affect any
repurchase transaction then outstanding or any rights or obligations
under this Agreement or the Master Agreement with respect to any
actions or omissions of any party hereto prior to termination. In the
event of termination, Repo Custodian will deliver any Securities, Cash
Collateral or cash held by it or any agent to Custodian or to such
successor custodian or custodian or subcustodian as the Participating
Funds shall instruct.
16. Compensation. Seller agrees to pay Repo Custodian compensation
for the services to be rendered hereunder, based upon rates which
shall be agreed upon from time to time.
17. Notices. Except with respect to communications between Custodian
and the Funds which shall be governed by the custodian agreement or
subcustodian agreement between such parties, as the case may be, and
except as otherwise provided herein or as the parties to the Agreement
shall from time to time otherwise agree, all instructions, notices,
reports and other communications contemplated by this Agreement shall
be given to the party entitled to receive such notice at the telephone
number and address listed on Schedule D hereto.
18. Severability. If any provision of this Agreement is held to be
unenforceable as a matter of law, the other terms and provisions
hereof shall not be affected thereby and shall remain in full force
and effect.
19. Binding Nature. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their successors and
assignees; provided that, no party hereto may assign this Agreement or
any of the rights or obligations hereunder without the prior written
consent of the other parties.
20. Headings. Section headings are for reference purposes only and
shall not be construed as a part of this Agreement.
21. Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one
instrument.
22. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
23. Limitation of Liability. Seller is hereby expressly put on
notice that the Declarations of Trust or the Certificates and
Agreements of Limited Partnership, as the case may be, of each
Participating Fund contain a limitation of liability provision
pursuant to which the obligations assumed by such Participating Fund
hereunder shall be limited in all cases to such Participating Fund and
its assets or, in the case of a series Fund, to the assets of that
series only, and neither Seller nor its respective agents or assigns
shall seek satisfaction of any such obligation from the officers,
employees, agents, directors, trustees, shareholders or partners of
any such Participating Fund or series.
24. Rights and Obligations of Each Fund. The rights and obligations
set forth in this Agreement with respect to each repurchase
transaction shall accrue only to the Participating Funds in accordance
with their respective interests therein. No other Fund shall receive
any rights or have any liabilities arising from any action or inaction
of any Participating Fund under this Agreement with respect to such
repurchase transaction.
25. General Provisions. This Agreement supersedes any other
custodian agreement by and among Seller, the Funds, and Repo Custodian
concerning repurchase transactions effected through the Joint Trading
Account. It is understood and agreed that time is of the essence with
respect to the performance of each party's respective obligations
hereunder.
26. Disclosure Relating to Certain Federal Protections
The parties acknowledge that they have been advised that:
(a) In the case of transactions in which one of the parties is a
broker or dealer registered with the SEC under Section 15 of the
Exchange Act, the Securities Investor Protection Corporation has taken
the position that the provisions of the Securities Investor Protection
Act of 1970 (the "SIPA") do not protect the other party with respect
to any transaction hereunder; and
(b) In the case of transactions in which one of the parties is a
government securities broker or a government securities dealer
registered with the SEC under Section 15C of the Exchange Act, SIPA
will not provide protection to the other party with respect to any
transaction hereunder.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
[Signature Lines Omitted]
SCHEDULE B
PRICING SOURCES
PRICING SERVICES
U.S. Government Securities Interactive Data Services or Mellon Data
Services (or any other pricing service mutually agreed upon by Seller
and the Funds)
GNMA - The Bond Buyer
FHLMC - The Bond Buyer
All other U.S. Government
and Agency Securities Interactive Data Services or Mellon Data
Services (or any other pricing service mutually agreed upon by Seller
and the Funds)
BROKERS' BROKERS AND BROKER DEALERS
U.S. Government Securities - Any Primary Dealer
GNMA - Any Primary Broker-Dealer's bid rate for such security
FHLMC - Any Primary Broker-Dealer's bid rate for such security
All other U.S. Government and Agency Securities - Any Primary
Broker-Dealer's bid rate for such security
Prices shall be as of the business day of the date of determination
or the last quote available. The pricing services, Brokers' Brokers
and Broker Dealers may be changed from time to time by agreement of
all the parties.
SCHEDULE C
AUTHORIZED PERSONS
Repo Custodian
Ken Rindos
Kurt Woetzel
Custodian
Ken Rindos
Kurt Woetzel
Seller
Joseph P. Blauvelt
Michael B. Boyer
Robert E. Curry
Patrick Doyle
Frank Forgione
Edward J. Frederick
Christopher Juliano
Joseph Marrone
Thomas T. McGee
John S. Mehrtens
John A. Michielini
Allen Smith, II
The Funds
Barron, Leland C . Harlow, Katharyn M. Stehman, Burnell R.
Carbone, John M. Henning, Frederick L. Jr. Todd, Deborah
Curtis, Fritz Huyck, Timothy Todd, John J.
Duby, Robert K. Jamen, Jon Torres, Joseph E.
Egan, Dorothy T. Litterst, Robert Williams, Richard
Glocke, David Silver, Samuel Zenoble, Sarah
SCHEDULE D
NOTICES
If to Custodian: The Bank of New York
One Wall Street, 4th Floor
New York, NY 10286
Telephone: (212) 635-7947
Attention: Sherman Yu, Esq.
With a copy to the Fund Agent
If to Repo Custodian: The Bank of New York
One Wall Street, 4th Floor
New York, New York 10286
Telephone: (212) 635-4809
Attention: Ms. Kristin Smith
If to Seller: J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
Telephone: (212) 483-2323
Attention: Middle Office Traders Support
If to any of the Funds: FMR Texas Inc.
400 East Las Colinas Blvd., CP9M
Irving, Texas 75039
Telephone: (214) 584-7800
Attention: Ms. Deborah R. Todd or
Mr. Samuel Silver
If to the Fund Agent: Fidelity Investments
[Name of Fund]
400 East Las Colinas Blvd., CP9E
Irving, Texas 75039
Telephone: (214) 584-4071
Attention: Mr. Mark Mufler
277282.c1
Exhibit g(13)
FORM OF
SCHEDULE 1
The following lists the additional counterparties to the Repo
Custodian Agreement for Joint Trading Account between The Bank of New
York and the Fidelity Funds:
BZW Government Securities, Inc.
CS First Boston Corp.
Daiwa Securities America, Inc.
Deutsche Bank Securities Corp.
Donaldson, Lufkin & Jenerette Securities Corp.
Fuji Securities, Inc.
Goldman Sachs & Co
Morgan Stanley & Co., Inc.
NationsBanc Capital Markets
Nikko Securities Co. International, Inc.
Nomura Securities International, Inc.
Prudential Securities, Inc.
Salomon Brothers, Inc.
Sanwa BJK Securities Co., LP
SBC Capital Markets, Inc.
Smith Barney, Inc.
Exhibit g(14)
Form of
JOINT TRADING ACCOUNT CUSTODY AGREEMENT
Between
THE BANK OF NEW YORK
and
FIDELITY FUNDS
Dated as of: _________
Exhibit g(14)
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Page
ARTICLE I - APPOINTMENT OF CUSTODIAN 2
ARTICLE II - POWERS AND DUTIES OF CUSTODIAN 2
Section 2.01. Establishment of Accounts 2
Section 2.02. Receipt of Funds 2
Section 2.03. Repurchase Transactions 2
Section 2.04. Other Transfers 4
Section 2.05. Custodian's Books and Records 5
Section 2.06. Reports by Independent Certified Public Accountants 5
Section 2.07. Securities System 6
Section 2.08. Collections 6
Section 2.09. Notices, Consents, Etc. 6
Section 2.10. Notice of Custodian's Inability to Perform 7
ARTICLE III - PROPER INSTRUCTIONS AND RELATED MATTERS 7
Section 3.01. Proper Instructions; Special Instruction 7
Section 3.02. Authorized Persons 8
Section 3.03. Investment Limitations 8
Section 3.04. Persons Having Access to Assets of the Funds 8
Section 3.05. Actions of Custodian Based on Proper Instructions and Special
Instructions 9
ARTICLE IV - STANDARD OF CARE; INDEMNIFICATION 9
Section 4.02. Liability of Custodian for Actions of Securities Systems 9
Section 4.03. Indemnification 9
Section 4.04. Funds, Right to Proceed 10
ARTICLE V - COMPENSATION 11
Section 5.01. Compensation 11
Section 5.02. Waiver of Right of Set-Off 11
ARTICLE VI - TERMINATION 11
Section 6.01. Events of Termination 11
Section 6.02. Successor Custodian; Payment of Compensation 11
ARTICLE VII - MISCELLANEOUS 12
Section 7.01. Representative Capacity and Binding Obligation 12
Section 7.02. Entire Agreement 12
Section 7.03. Amendments 12
Section 7.04. Interpretation 12
Section 7.05. Captions 13
Section 7.06. Governing Law 13
Section 7.07. Notice and Confirmations 13
Section 7.08. Assignment 14
Section 7.09. Counterparts 14
Section 7.10. Confidentiality; Survival of Obligations 14
</TABLE>
Exhibit g(14)
Form of
JOINT TRADING ACCOUNT CUSTODY AGREEMENT
AGREEMENT dated as of ___________ by and between The Bank of New York
(hereinafter referred to as the "Custodian") and each of the entities
listed on Schedules A-1, A-2, A-3 and A-4 hereto, acting on behalf of
itself or, (i) in the case of a series company, on behalf of one or
more of its portfolios or series listed on Schedule A-1 or A-2 hereto,
(ii) in the case of the accounts listed on Schedule A-3 hereto, acting
through Fidelity Management & Research Company, and (iii) in the case
of the commingled or individual accounts listed on Schedule A-4
hereto, acting through Fidelity Management Trust Company
(collectively, the "Funds" and each, a "Fund").
W I T N E S S E T H
WHEREAS, each of the Funds desire to appoint the Custodian as its
custodian for the purpose of establishing and administering one or
more joint trading accounts or subaccounts thereof (individually, an
"Account" and collectively, the "Accounts") and holding cash and
securities for the Funds in connection with repurchase transactions
effected through the Accounts; and
WHEREAS, one or more of the Funds may, from time to time, enter into
one or more written repurchase agreements pursuant to which one or
more of the Funds agrees to purchase and resell, and the sellers named
in such agreements agree to sell and repurchase through the Accounts,
certain securities (collectively, the "Securities") (such repurchase
agreements being hereinafter referred to, collectively, as the
"Repurchase Agreements"); and
WHEREAS, each of the custodians identified in ScheduleB hereto (each,
a "Fund Custodian") serves as the primary custodian for one or more of
the Funds; and
WHEREAS, from time to time one or more of the Funds may arrange to
transfer cash or Securities from one or more Fund Custodians to the
Custodian or transfer cash or Securities from the Custodian to one or
more Fund Custodians, or in the case of Funds in which Custodian is
also Fund Custodian, such Fund may arrange for transfer of cash or
Securities between an Account and an account maintained by Custodian
in its capacity as Fund Custodian for such Fund, in each event in
connection with Repurchase Agreement transactions; and
WHEREAS, from time to time, such Funds may arrange to transfer cash
or securities from the Custodian to the seller in such Repurchase
Agreement transactions, or in the case in which Custodian is also the
clearing bank for such seller, such Funds may arrange for transfer of
cash or securities between an Account and an account maintained by
Custodian for such seller in its capacity as clearing bank, in each
event in connection with two-party Repurchase Agreement transactions;
and
WHEREAS, each of the custodians identified in Schedule C hereto
(each, a "Repo Custodian") serves as a third-party custodian of the
Funds for purposes of effecting third-party Repurchase Agreement
transactions; and
WHEREAS, from time to time one or more of the Funds may arrange to
transfer cash or Securities from the Custodian to one or more Repo
Custodians or transfer cash or Securities from one or more Repo
Custodians to the Custodian, or in the case in which Custodian is also
Repo Custodian, such Funds may arrange for transfer of cash or
securities between an Account and an account maintained for such Funds
in its capacity as Repo Custodian, in each event in connection with
third-party Repurchase Agreement transactions;
NOW, THEREFORE, the parties hereto hereby agree as follows:
ARTICLE I - APPOINTMENT OF CUSTODIAN
Each of the Funds hereby employs and appoints the Custodian as its
custodian, subject to the terms and provisions of this Agreement.
ARTICLE II - POWERS AND DUTIES OF CUSTODIAN
As custodian, the Custodian shall have and perform the powers and
duties, and only such powers and duties, as are set forth in this
Agreement.
Section 2.01. Establishment of Accounts. The Custodian shall
establish one or more Accounts as segregated joint trading accounts
for the Funds through which the Funds shall, from time to time, effect
Repurchase Agreement transactions.
Section 2.02. Receipt of Funds. The Custodian shall, from time to
time, receive funds for or on behalf of the Funds and shall hold such
funds in safekeeping. Upon receipt of Proper Instructions, the
Custodian shall credit funds so received to one or more Accounts
designated in such Proper Instructions. Promptly after receipt of
such funds from the Fund Custodian or a Repo Custodian or promptly
following the transfer to an Account from any account maintained by
Custodian in its capacity as Fund Custodian, or as Repo Custodian, the
Custodian shall provide written confirmation of such receipt to the
Fund Custodian or Repo Custodian, when and as applicable, and of such
receipt or transfer to the Fund Agent designated in Section 7.07(b)
hereof (the "Fund Agent"). The Custodian shall designate on its books
and records the funds allocable to each Account and the identity of
each Fund participating in such Account.
Section 2.03. Repurchase Transactions. The Funds may, from time to
time, enter into Repurchase Agreement transactions. In connection
with each such Repurchase Agreement transaction, unless otherwise
specifically directed by Special Instructions, the Custodian shall
take the following actions:
(a) Purchase of Securities. Upon receipt of Proper Instructions, the
Custodian shall pay for and receive Securities and any cash
denominated in U.S. Dollars which is serving as collateral ("Cash
Collateral"), provided that payment therefor shall be made by the
Custodian only against prior or simultaneous receipt of the Securities
and any Cash Collateral in the manner prescribed in subsection 2.03(b)
below. Except as provided in Section2.04 hereof, in no event shall
the Custodian deliver funds from an Account for the purchase of
Securities and any Cash Collateral prior to receipt of the Securities
and any Cash Collateral by the Custodian or a Securities System (as
hereinafter defined). The Custodian is not under any obligation to
make credit available to the Funds to complete transactions hereunder.
Promptly after the transfer of funds and receipt of Securities and any
Cash Collateral, the Custodian shall provide a confirmation to the
Fund Agent, setting forth (i) the Securities and any Cash Collateral
which the Custodian has received pursuant to the Repurchase Agreement
transaction, (ii) the amount of funds transferred from the applicable
Account, and (iii) any security or transaction identification numbers
reasonably requested by the Fund Agent.
(b) Receipt and Holding of Securities. In connection with each
Repurchase Agreement transaction, the Custodian shall receive and hold
the Securities as follows: (i) in the case of certificated securities,
by physical receipt of the certificates or other instruments
representing such Securities and by physical segregation of such
certificates or instruments from other assets of the Custodian in a
manner indicating that such Securities belong to specified Funds; and
(ii) in the case of Securities held in book-entry form by a Securities
System (as hereinafter defined), by appropriate transfer and
registration of such Securities to a customer only account of the
Custodian on the book-entry records of the Securities System, and by
appropriate entry on the books and records of the Custodian
identifying such Securities as belonging to specified Funds.
(c) Sale of Securities. Upon receipt of Proper Instructions, the
Custodian shall make delivery of Securities and any Cash Collateral
held in or credited to an Account against prior or simultaneous
payment for such Securities in immediately available funds in the form
of: (i) cash, bank credit, or bank wire transfer received by the
Custodian; or (ii) credit to the customer only account of the
Custodian with a Securities System. Notwithstanding the foregoing,
the Custodian shall make delivery of Securities held in physical form
in accordance with "street delivery custom" to a broker or its
clearing agent, against delivery to the Custodian of a receipt for
such Securities; provided that the Custodian shall have taken all
actions possible to ensure prompt collection of the payment for, or
the return of such Securities by the broker or its clearing agent.
Promptly after the transfer of Securities and any Cash Collateral and
the receipt of funds, the Custodian shall provide a confirmation to
the Fund Agent, setting forth the amount of funds received by the
Custodian or a Securities System for credit to the applicable Account.
(d) Additional Functions. Upon receipt of Proper Instructions, the
Custodian shall take all such other actions as specified in such
Proper Instructions and as shall be reasonable or necessary with
respect to Repurchase Agreement transactions and the Securities and
funds transferred and received pursuant to such transactions,
including, without limitation, all such actions as shall be prescribed
in the event of a default under a Repurchase Agreement.
(e) Nondiscretionary Functions. The Custodian shall attend to all
non-discretionary details in connection with the purchase, sale,
transfer or other dealings with Securities or other assets of the
Funds held by the Custodian.
(f) In the event that the Custodian is directed by Proper
Instructions to make any payment or transfer of funds on behalf of a
Fund for which there would be, at the close of business on the date of
such payment or transfer, insufficient funds held by the Custodian on
behalf of such Fund, the Custodian may, in its discretion, provide an
overdraft ("Overdraft") to the Fund, in an amount sufficient to allow
the completion of such payment or transfer. Any Overdraft provided
hereunder: (a) shall be payable on the next Business Day, unless
otherwise agreed by the Fund and the Custodian; and (b) shall accrue
interest form the date of the Overdraft to the date of payment in full
by the Fund at a rate agreed upon in writing, from time to time, by
the Custodian and the Fund. The Custodian and the Funds acknowledge
that the purpose of such Overdrafts is to temporarily finance the
purchase or sale of securities for prompt delivery in accordance with
the terms hereof, or to meet emergency expenses not reasonably
foreseeable by a particular Fund. The Funds hereby agree that the
Custodian shall have a continuing lien and security interest in and to
all Securities whose purchase is financed by Custodian and which are
in Custodian's possession or in the possession or control of any third
party acting on Custodian's behalf and the proceeds thereof. In this
regard, Custodian shall be entitled to all the rights and remedies of
a pledgee under common law and a secured party under the New York
Uniform Commercial Code and any other applicable laws or regulations
as then in effect.
Section 2.04. Other Transfers.
(a) In addition to transfers of funds and Securities referred to in
Section 2.03, the Custodian shall transfer funds and Securities held
in an Account: (a) upon receipt of Proper Instructions, to (i)any
Fund Custodian, or (ii)any other account maintained for any Fund by
the Custodian in its capacity as a Fund Custodian, (iii)any Repo
Custodian or (iv) any other account maintained for any Fund by the
Custodian in its capacity as a Repo Custodian; or (b) upon receipt of
Special Instructions, and subject to Section 3.04 hereof, to any other
person or entity designated in such Special Instructions.
(b) Determination of Fund Custodian Daily Net Amount. On each
banking day, based upon daily transaction information provided to the
Custodian by the Funds, Custodian shall determine: (i) the amount of
cash due to be transferred on such day by each Fund Custodian to the
Custodian in connection with all Repurchase Agreement transactions in
which the date fixed for the repurchase and resale of Securities is
the banking day next following the date on which the sale and purchase
of such Securities takes place (each, an "Overnight Repo Transaction")
to be effected through the Accounts in such day; and (ii) the amount
of cash due to be transferred on such day by Custodian to such Fund
Custodian in connection with all outstanding Overnight Repo
Transactions previously effected through the Accounts (the difference
between (i) and (ii) with respect to each Fund Custodian being
referred to as the "Fund Custodian Daily Net Amount"). On each
banking day, Custodian shall notify each Fund Custodian of the
foregoing determination and, unless otherwise directed in accordance
with Proper Instructions, Custodian shall (i) instruct such Fund
Custodian to transfer cash to the Custodian equal to the Fund
Custodian Daily Net Amount (if the Fund Custodian Daily Net Amount is
positive) or (ii) transfer to such Fund Custodian cash equal to the
Fund Custodian Daily Net Amount (if the Fund Custodian Daily Net
Amount is negative).
(c) Determination of Repo Custodian Daily Net Amount. On each
banking day, based upon daily transaction information provided to the
Custodian by the Funds and each Repo Custodian, Custodian shall
determine: (i) the amount of cash due to be transferred on such day
by each Repo Custodian on behalf of the Funds to all counterparties in
connection with all third-party Overnight Repo Transactions to be
effected through the Accounts on such day; and (ii) the amount of cash
due to be transferred on such day by each Repo Custodian on behalf of
all counterparties to the Funds in connection with all outstanding
third-party Overnight Repo Transactions previously effected through
the Accounts (the difference between (i) and (ii) with respect to each
Repo Custodian being referred to as the "Repo Custodian Daily Net
Amount"). On each banking day, Custodian shall notify the Funds of
the foregoing determinations and, unless otherwise directed in
accordance with Proper Instructions, Custodian shall (i) transfer to
each Repo Custodian cash equal to the Repo Custodian Daily Net Amount
(if the Repo Custodian Daily Net Amount is positive) or (ii) instruct
each Repo Custodian to transfer to the Custodian cash equal to the
Repo Custodian Daily Net Amount (if the Repo Custodian Daily Net
Amount is negative).
Section 2.05. Custodian's Books and Records. The Custodian shall
provide any assistance reasonably requested by the Funds in the
preparation of reports to shareholders of the Funds and others, audits
of accounts, and other ministerial matters of like nature. The
Custodian shall maintain complete and accurate records with respect to
cash and Securities held for the benefit of the Funds as required by
the rules and regulations of the Securities and Exchange Commission
applicable to investment companies registered under the Investment
Company Act of 1940, as amended (the "Investment Company Act"),
including: (a) journals or other records of original entry containing
a detailed and itemized daily record of all receipts and deliveries of
securities (including certificate and transaction identification
numbers, if any), and all receipts and disbursements of cash; (b)
ledgers or other records reflecting Securities in transfer, and
Securities in physical possession; and (c) cancelled checks and bank
records related thereto. The Custodian shall keep such other books
and records of the Funds relating to repurchase transactions effected
through the Accounts as the Funds shall reasonably request. Such
books and records maintained by the Custodian shall reflect at all
times the identity of each Fund participating in each Account and the
aggregate amount of the Securities and any Cash Collateral held by the
Custodian on behalf of the Funds in such Account pursuant to this
Agreement. All such books and records maintained by the Custodian
shall be maintained in a form acceptable to the Funds and in
compliance with the rules and regulations of the Securities and
Exchange Commission, including, but not limited to, books and records
required to be maintained by Section 31(a) of the Investment Company
Act and the rules from time to time adopted thereunder. All books and
records maintained by the Custodian relating to the Accounts shall at
all times be the property of the Funds and shall be available during
normal business hours for inspection and use by the Funds and their
agents, including, without limitation, their independent certified
public accountants. Notwithstanding the preceding sentence, the Funds
shall not take any actions or cause Custodian to take any actions
which would cause, either directly or indirectly, the Custodian to
violate any applicable laws, regulations, rules or orders.
Section 2.06. Reports by Independent Certified Public Accountants.
At the request of the Funds, the Custodian shall deliver to the Funds
such annual reports and other interim reports prepared by the
independent certified public accountants of the Custodian with respect
to the services provided by the Custodian under this Agreement,
including, without limitation, the Custodian's accounting system,
internal accounting control and procedures for safeguarding
Securities, including Securities deposited and/or maintained in a
Securities System. Such reports, which shall be of sufficient scope
and in sufficient detail as may reasonably be required by the Funds
and as may reasonably by obtained by the Custodian, shall provide
reasonable assurance to the Funds that the procedures employed by the
independent certified public accountants are reasonably designed to
detect any material inadequacies with respect to the matters discussed
in the report, shall state in detail the material inadequacies
disclosed by such examination, and, if no such inadequacies exist,
shall so state.
Section 2.07. Securities System. As used herein the term "Securities
System" shall mean each of the following: (a) the Depository Trust
Company; (b) the Participants Trust Company; (c) any book-entry system
as provided in (i) Subpart0 of Treasury Circular No. 300, 31CFR
306.115, (ii) SubpartB of Treasury Circular Public Debt Series No.
27-76, 31CFR 350.2, or (iii) the book-entry regulations of federal
agencies substantially in the form of 31CFR 306.115; or (d) any
domestic clearing agency registered with the Securities and Exchange
Commission under Section17A of the Securities Exchange Act of 1934, as
amended (or as may otherwise be authorized by the Securities and
Exchange Commission to serve in the capacity of depository or clearing
agent for the securities or other assets of investment companies)
which acts as a securities depository and the use of which has been
approved in Special Instructions. Use of a Securities System by the
Custodian shall be in accordance with applicable Federal Reserve Board
and Securities and Exchange Commission rules and regulations, if any,
and subject to the following provisions:
(A) The Custodian may deposit and/or maintain Securities held
hereunder in a Securities System, provided that such Securities are
represented in an account of the Custodian in the Securities System
which account shall not contain any assets of the Custodian other than
assets held as a fiduciary, custodian, or otherwise for customers.
(B) The Custodian shall, if requested by the Funds, provide the Funds
with all reports obtained by the Custodian with respect to the
Securities System's accounting system, internal accounting control and
procedures for safeguarding securities deposited in the Securities
System.
(C) Upon receipt of Special Instructions, the Custodian shall
terminate the use hereunder of any Securities System (except for the
federal book-entry system) as promptly as practicable and shall take
all actions reasonably practicable to safeguard the Securities and
other assets of the Funds maintained with such Securities System.
Section 2.08. Collections. The Custodian shall (a) collect, receive
and deposit in the applicable Account all income and other payments
with respect to Securities held by the Custodian hereunder; (b)
endorse and deliver any instruments required to effect such
collection; and (c) execute ownership and other certificates and
affidavits for all federal, state and foreign tax purposes in
connection with receipt of income or other payments with respect to
Securities, or in connection with the transfer of Securities.
Section 2.09. Notices, Consents, Etc. The Custodian shall deliver to
the Funds, in the most expeditious manner practicable, all notices,
consents or announcements affecting or relating to Securities held by
the Custodian on behalf of the Funds that are received by the
Custodian, and, upon receipt of Proper Instructions, the Custodian
shall execute and deliver such consents or other authorizations as may
be required.
Section 2.10. Notice of Custodian's Inability to Perform. The
Custodian shall promptly notify the Funds in writing by facsimile
transmission or such other manner as the Funds may designate, if, for
any reason: (a) the Custodian determines that it is unable to perform
any of its duties or obligations hereunder or its duties or
obligations with respect to any repurchase transaction; or (b) the
Custodian reasonably foresees that it will be unable to perform any
such duties or obligations.
ARTICLE III - PROPER INSTRUCTIONS AND RELATED MATTERS
Section 3.01. Proper Instructions; Special Instruction.
(a) Proper Instructions. As used herein, the term "Proper
Instructions" shall mean: (i) a tested telex, a written (including,
without limitation, facsimile transmission) request, direction,
instruction or certification signed or initialed by one or more
Authorized Persons (as hereinafter defined); (ii) a telephonic or
other oral communication by one or more Authorized Persons; or (iii) a
communication effected directly between electromechanical or
electronic devices or systems (including, without limitation,
computers) by one or more Authorized Persons; provided, however, that
communications of the types described in clauses (ii) and (iii) above
purporting to be given by an Authorized Person shall be considered
Proper Instructions only if the Custodian reasonably believes such
communications to have been given by an Authorized Person with respect
to the transaction involved. Proper Instructions in the form of oral
communications shall be confirmed by the Funds by tested telex or in
writing in the manner set forth in clause(i) above, but the lack of
such confirmation shall in no way affect any action taken by the
Custodian in reliance upon such oral instructions prior to the
Custodian's receipt of such confirmation. Each of the Funds and the
Custodian is hereby authorized to record any and all telephonic or
other oral instructions communicated to the Custodian. Proper
Instructions may relate to specific transactions or to types or
classes of transactions, and may be in the form of standing
instructions.
(b) Special Instructions. As used herein, the term "Special
Instructions" shall mean Proper Instructions countersigned or
confirmed in writing by, in the case of the entities listed in
Schedules A-1 or A-2 hereto, the Treasurer or any Assistant Treasurer
of the Funds or any other person designated in writing by the
Treasurer of the Funds, and in the case of each of the entities listed
on Schedules A-3 or A-4, by the officer who is a signatory to this
Agreement on behalf of such entity or any other person designated in
writing by such officer or an officer of such entity of higher
authority, which countersignature or written confirmation shall be (i)
included on the same instrument containing the Proper Instructions or
on a separate instrument relating thereto, and (ii) delivered by hand,
by facsimile transmission, or in such other manner as the parties
hereto may agree in writing.
(c) Address for Proper Instructions and Special Instructions. Proper
Instructions and Special Instructions shall be delivered to the
Custodian at the address and/or telephone, telecopy or telex number
agreed upon from time to time by the Custodian and the Funds.
Section 3.02. Authorized Persons. Concurrently with the execution of
this Agreement and from time to time thereafter, as appropriate, the
Funds shall deliver to the Custodian, duly certified as appropriate by
the Treasurer or any Assistant Treasurer of the Funds or by a
Secretary or Assistant Secretary of the Funds, and in the case of each
of the entities listed on Schedules A-3 or A-4, by the officer who is
a signatory to this Agreement on behalf of such entity or any other
person designated in writing by such officer or an officer of higher
authority, a certificate setting forth (a) the names, signatures and
scope of authority of all persons authorized to give Proper
Instructions or any other notice, request, direction, instruction,
certificate or instrument on behalf of the Funds (collectively, the
"Authorized Persons," and individually, an "Authorized Person"), and
(b) the names and signatures of those persons authorized to issue
Special Instructions. Such certificate may be accepted and relied
upon by the Custodian as conclusive evidence of the facts set forth
therein and shall be considered to be in full force and effect until
delivery to the Custodian of a similar certificate to the contrary.
Upon delivery of a certificate which deletes the name of a person
previously authorized to give Proper Instructions or to issue Special
Instructions, such person shall no longer be considered an Authorized
Person or authorized to issue Special Instructions, as applicable.
Section 3.03. Investment Limitations. In performing its duties
hereunder the Custodian may assume, unless and until it receives
special Instructions to the contrary (a "Contrary Notice"), that
Proper Instructions received by it are not in conflict with or in any
way contrary to any investment or other limitation applicable to any
of the Funds. The Custodian shall in no event be liable to the Funds
and shall be indemnified by the Funds for any loss, damage or expense
to the Custodian arising out of any violation of any investment or
other limitation to which any Fund is subject, except to the extent
that such loss, damage or expense: (i) relates to a violation of any
investment or other limitation of a Fund occurring after receipt by
the Custodian of a Contrary Notice; or (ii) arises from a breach of
this Agreement by the Custodian.
Section 3.04. Persons Having Access to Assets of the Funds. No
Authorized Person, Trustee, officer, employee or agent of the Funds
(other than the Custodian) shall have physical access to the assets of
the Funds held by the Custodian, or shall be authorized or permitted
to withdraw any such assets for delivery to an account of such person,
nor shall the Custodian deliver any such assets to any such person;
provided, however, that nothing in this Section 3.04 shall prohibit:
(a) any Authorized Person from giving Proper Instructions, or the
persons described in Section 3.01(b) from issuing Special
Instructions, so long as such action does not result in delivery of or
access to assets of the Funds prohibited by this Section 3.04; or (b)
the Funds' independent certified public accountants from examining or
reviewing the assets of the Funds held by the Custodian.
Section 3.05. Actions of Custodian Based on Proper Instructions and
Special Instructions. Subject to the provisions of Section 4.01
hereof, the Custodian shall not be responsible for the title, validity
or genuineness of any property, or evidence of title thereof, received
by it or delivered by it pursuant to this Agreement.
ARTICLE IV - STANDARD OF CARE; INDEMNIFICATION
Section 4.01. Standard of Care.
(a) General Standard of Care. The Custodian shall exercise
reasonable care and diligence in carrying out all of its duties and
obligations under this Agreement, and shall be liable to the Funds for
all loss, damage and expense incurred or suffered by the Funds,
resulting from the failure of the Custodian to exercise such
reasonable care and diligence or from any other breach by the
Custodian of the terms of this Agreement.
(b) Acts of God, Etc. In no event shall the Custodian incur
liability hereunder if the Custodian is prevented, forbidden or
delayed from performing, or omits to perform, any act or thing which
this Agreement provides shall be performed or omitted to be performed
by reason of: (i) any provision of any present or future law or
regulation or order of the United States of America, or any state
thereof, or of any foreign country, or political subdivision thereof
or of any court of competent jurisdiction; or (ii) any act of God or
war; unless, in each case, such delay or nonperformance is caused by
(A) the negligence, misfeasance or misconduct of the Custodian, or (B)
a malfunction or failure of equipment maintained or operated by the
Custodian other than a malfunction or failure caused by events beyond
the Custodian's control and which could not reasonably be anticipated
and/or prevented by the Custodian.
(c) Mitigation by Custodian. Upon the occurrence of any event which
causes or may cause any loss, damage or expense to the Funds, the
Custodian shall use all commercially reasonable efforts and shall take
all reasonable steps under the circumstances to mitigate the effects
of such event and to avoid continuing harm to the Funds.
Section 4.02. Liability of Custodian for Actions of Securities
Systems. Notwithstanding the provisions of Section4.01 to the
contrary, the Custodian shall not be liable to the Funds for any loss,
damage or expense resulting from the use by the Custodian of a
Securities System, unless such loss, damage or expense is caused by,
or results from, negligence, misfeasance or misconduct of the
Custodian. In the case of loss, damage or expense resulting from use
of a Securities System by the Custodian, the Custodian shall take all
reasonable steps to enforce such rights as it may have against the
Securities System to protect the interest of the Funds.
Section 4.03. Indemnification.
(a) Indemnification Obligations. Subject to the limitations set
forth in this Agreement, the Funds severally agree to indemnify and
hold harmless the Custodian from all claims and liabilities (including
reasonable attorneys' fees) incurred or assessed against the Custodian
for actions taken in reliance upon Proper Instructions or Special
Instructions; provided, however, that such indemnity shall not apply
to claims and liabilities occasioned by or resulting from the
negligence, misfeasance or misconduct of the Custodian, or any other
breach of this Agreement by the Custodian. In addition, the Funds
severally agree to indemnify the Custodian against any liability
incurred by the Custodian by reason of taxes assessed to the
Custodian, or other costs, liability or expenses incurred by the
Custodian, resulting directly or indirectly solely from the fact that
securities and other property of the Funds is registered in the name
of the Custodian; provided, however, in no event shall such
indemnification be applicable to income, franchise or similar taxes
which may be imposed or applied against the Custodian or charges
imposed by a Federal Reserve Bank with respect to intra-day overdrafts
unless separately agreed to by the Funds.
(b) Extent of Liability. Notwithstanding anything to the contrary
contained herein, with respect to the indemnification obligations of
the Funds provided in this Section4.03, each Fund shall be: (i)
severally, and not jointly and severally, liable with each of the
other Funds; and (ii) liable only for its pro rata share of such
liabilities, determined with reference to such Fund's proportionate
interest in the aggregate of assets held by the Custodian in the
Account with respect to which such liability relates at the time such
liability was incurred, as reflected on the books and records of the
Funds.
(c) Notice of Litigation, Right to Prosecute, Etc. The Custodian
shall promptly notify the Funds in writing of the commencement of any
litigation or proceeding brought against the Custodian in respect of
which indemnity may be sought against the Funds pursuant to this
Section4.03. The Funds shall be entitled to participate in any such
litigation or proceeding and, after written notice from the Funds to
the Custodian, the Funds may assume the defense of such litigation or
proceeding with counsel of their choice at their own expense. The
Custodian shall not consent to the entry of any judgment or enter into
any settlement in any such litigation or proceeding without providing
the Funds with adequate notice of any such settlement or judgment, and
without the Funds' prior written consent. The Custodian shall submit
written evidence to the Funds with respect to any cost or expense for
which it seeks indemnification in such form and detail as the Funds
may reasonably request.
Section 4.04. Funds, Right to Proceed. Notwithstanding anything to
the contrary contained herein, the Funds shall have, at their election
upon reasonable notice to the Custodian, the right to enforce, to the
extent permitted by any applicable agreement and applicable law, the
Custodian's rights against any Securities System or other person for
loss, damage or expense caused the Custodian or the Funds by such
Securities System or other person, and shall be entitled to enforce
the rights of the Custodian with respect to.any claim against such
Securities System or other person which the Custodian may have as a
consequence of any such loss, damage or expense if and to the extent
that the Custodian or any Fund has not been made whole for any such
loss, damage or expense.
ARTICLE V - COMPENSATION
Section 5.01. Compensation. The Custodian shall be compensated for
its services hereunder in an amount, and at such times, as may be
agreed upon, from time to time, by the Custodian and the Funds. Each
Fund shall be severally, and not jointly, liable with the other Funds
only for its pro rata share of such compensation, determined with
reference to such Fund's proportionate interest in each Repurchase
Agreement transaction to which such compensation relates.
Section 5.02. Waiver of Right of Set-Off. The Custodian hereby
waives and relinquishes all contractual and common law rights of
set-off to which it may now or hereafter be or become entitled with
respect to any obligations of the Funds to the Custodian arising under
this Agreement.
ARTICLE VI - TERMINATION
Section 6.01. Events of Termination. This Agreement shall continue
in full force and effect until the first to occur of: (a) termination
by the Custodian or the Funds by an instrument in writing delivered to
the other party, such termination to take effect not sooner than
ninety (90) days after the date of such delivery; or (b) termination
by the Funds by written notice delivered to the Custodian, based upon
the Funds' determination that there is a reasonable basis to conclude
that the Custodian is insolvent or that the financial condition of the
Custodian is deteriorating in any material respect, in which case
termination shall take effect upon the Custodians receipt of such
notice or at such later time as the Funds shall designate; provided,
however, that this Agreement may be terminated as to one or more Funds
(but less than all Funds) by delivery of an amended Schedule A-1, A-2,
A-3 or A-4 pursuant to Section7.03 hereof. The execution and delivery
of an amended Schedule A-1, A-2, A-3 or A-4 which deletes one or more
Funds shall constitute a termination of this Agreement only with
respect to such deleted Fund(s).
Section 6.02. Successor Custodian; Payment of Compensation. Each of
the Funds may identify a successor custodian to which the cash,
Securities and other assets of such Fund shall, upon termination of
this Agreement, be delivered; provided that in the case of the
termination of this Agreement with respect to any of the Funds, such
Fund or Funds shall direct the Custodian to transfer the assets of
such Fund or Funds held by the Custodian pursuant to Proper
Instructions. The Custodian agrees to cooperate with the Funds in the
execution of documents and performance or all other actions necessary
or desirable in order to substitute the successor custodian for the
Custodian under this Agreement. In the event of termination, each
Fund shall make payment of such Fund's applicable share of unpaid
compensation within a reasonable time following termination and
delivery of a statement to the Funds setting forth such fees. The
termination of this Agreement with respect to any of the Funds shall
be governed by the provisions of this ArticleVI as to notice, payments
and delivery of securities and other assets, and shall not affect the
obligations of the parties hereunder with respect to the other Funds
set forth in Schedule A-1, A-2, A-3 or A-4 as amended from time to
time.
ARTICLE VII - MISCELLANEOUS
Section 7.01. Representative Capacity and Binding Obligation. A COPY
OF THE DECLARATION OF TRUST OR OTHER ORGANIZATIONAL DOCUMENTS OF EACH
FUND IS ON FILE WITH THE SECRETARY OF THE STATE OF EACH FUND'S
FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT IS NOT
EXECUTED ON BEHALF OF THE TRUSTEES OF ANY FUND AS INDIVIDUALS, AND THE
OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE
SHAREHOLDERS, TRUSTEES, DIRECTORS, PARTNERS, OFFICERS, EMPLOYEES OR
AGENTS OF ANY FUND INDIVIDUALLY, BUT ARE BINDING ONLY UPON THE ASSETS
AND PROPERTY OF THE FUNDS, AND IN THE CASE OF SERIES COMPANIES, SUCH
FUNDS' RESPECTIVE PORTFOLIOS OR SERIES.
THE CUSTODIAN AGREES THAT NO SHAREHOLDER, TRUSTEE, DIRECTOR, PARTNER,
OFFICER, EMPLOYEE OR AGENT OF ANY FUND MAY BE HELD PERSONALLY LIABLE
OR RESPONSIBLE FOR ANY OBLIGATIONS OF THE FUNDS ARISING OUT OF THIS
AGREEMENT. WITH RESPECT TO OBLIGATIONS OF EACH FUND ARISING OUT OF
THIS AGREEMENT, THE CUSTODIAN SHALL LOOK FOR PAYMENT OR SATISFACTION
OF ANY CLAIM SOLELY TO THE ASSETS AND PROPERTY OF THE FUND TO WHICH
SUCH OBLIGATION RELATES AS THOUGH EACH FUND HAD SEPARATELY CONTRACTED
WITH THE CUSTODIAN BY SEPARATE WRITTEN INSTRUMENT."
Section 7.02. Entire Agreement. This Agreement constitutes the
entire understanding and agreement of the parties hereto with respect
to the subject matter hereof.
Section 7.03. Amendments. No provision of this Agreement may be
amended except by a statement in writing signed by the party against
which enforcement of the amendment is sought; provided, however,
Schedule A-1, A-2, A-3 or A-4 listing the Funds which are parties
hereto, Schedule B listing the Fund Custodians and Schedule C listing
the Repo Custodians may be amended from time to time to add or delete
one or more Funds, Fund Custodians or Repo Custodians, as the case may
be, by the Funds' delivery of an amended Schedule A-1, A-2, A-3 or
A-4, Schedule B or Schedule C to the Custodian. The deletion of one
or more Funds from Schedule A-1, A-2, A-3 or A-4 shall have the effect
of terminating this Agreement as to such Fund(s), but shall not affect
this Agreement with respect to any other Fund.
Section 7.04. Interpretation. In connection with the operation of
this Agreement, the Custodian, and the Funds may agree in writing from
time to time on such provisions interpretative of or in addition to
the provisions of this Agreement as may in their joint opinion be
consistent with the general tenor of this Agreement. No
interpretative or additional provisions made as provided in the
preceding sentence shall be deemed to be an amendment of this
Agreement.
Section 7.05. Captions. Headings contained in this Agreement, which
are included as convenient references only, shall have no bearing upon
the interpretation of the terms of the Agreement or the obligations of
the parties hereto.
Section 7.06. Governing Law. THE PROVISIONS OF THIS AGREEMENT SHALL
BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF.
Section 7.07. Notice and Confirmations.
(a) Except as provided in Section 7.07(b) below and except in the
case of Proper Instructions or Special Instructions, notices and other
writings contemplated by this Agreement shall be delivered by hand or
by facsimile transmission (provided that in the case of delivery by
facsimile transmission, notice shall also be mailed postage prepaid)
to the parties at the following addresses:
(i) If to the Funds:
FMR Texas Inc.
400 East Las Colinas Blvd., CP9M
Irving, Texas 75039
Telephone: (214) 584-7800
Attention: Ms. Deborah Todd or
Mr. Samuel Silver
(ii) If to the Custodian:
The Bank of New York
One Wall Street
Fourth Floor
New York, NY 10286
Attn: Claire Meskovic
Telephone: (212) 635-4808
Telefax: (212) 635-4828
(b) The Custodian may provide the confirmations required by Sections
2.02 and 2.03 of this Agreement by making the information available in
the form of a communication directly between electromechanical or
electrical devices or systems (including, without limitation,
computers) (or in such other manner as the parties hereto may agree in
writing) to the following Fund Agent:
Fidelity Accounting and Custody
Domestic Securities Operations
400 East Las Colinas Blvd., CP9E
Irving, Texas 75039
Telephone: (214) 506-4071
Attention: Mr. Mark Mufler
The address and telephone number of the Funds, the Fund Agent and the
Custodian and the identity of the Fund Agent specified in this Section
7.07 may be changed by written notice of the Funds to Custodian or
Custodian to the Funds, as the case may be. All written notices which
are required or provided to be given hereunder shall be effective upon
actual receipt by the entity to which such notice is given.
Section 7.08. Assignment. This Agreement shall be binding on and
shall inure to the benefit of the parties hereto and their respective
successors and assigns, provided that, no party hereto may assign this
Agreement or any of its rights or obligations hereunder without the
prior written consent of each of the other parties.
Section 7.09. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original.
This Agreement shall become effective when one or more counterparts
have been signed and delivered by each of the parties.
Section 7.10. Confidentiality; Survival of Obligations. The parties
hereto agree that they shall each shall treat confidentially the terms
and conditions of this Agreement and all information provided by each
party to the others regarding its business and operations. All
confidential information provided by a party hereto shall be used by
any other party hereto solely for the purpose of rendering services
pursuant to this Agreement and, except as may be required in carrying
out this Agreement, shall not be disclosed to any third party without
the prior consent of such providing party. The foregoing shall not be
applicable to any information that is publicly available when provided
or thereafter becomes publicly available other than through a breach
of this Agreement, or that is required to be disclosed by any bank
examiner of the Custodian, any auditor of the parties hereto or by
judicial or administrative process or otherwise by applicable law or
regulation. The provisions of this Section 7.10 and Sections3.03,
4.01, 4.02, 4.03, 4.04, 4.05, 7.01 and 7.06 shall survive any
termination of this Agreement, provided that in the event of
termination the Custodian agrees that it shall transfer and return
Securities and other assets held by the Custodian for the benefit of
the Funds as the Funds direct pursuant to Proper Instructions.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed in its name and behalf on the day and year first above
written.
[Signature Lines Omitted]
SCHEDULES A-1, A-2, A-3 AND A-4
TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT BETWEEN
THE BANK OF NEW YORK AND FIDELITY FUNDS DATED AS OF __________
The following is a list of the Funds to which this Agreement applies:
SCHEDULE B
TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT
BETWEEN THE BANK OF NEW YORK AND
FIDELITY FUNDS DATED AS OF MAY 11, 1995
The following is a list of the Fund Custodians of the Funds:
The Bank of New York
Morgan Guaranty Trust Company
Brown Brothers Harriman & Co.
First Union National Bank Charlotte
Chase Manhattan Bank, N.A.
State Street Bank and Trust Company
SCHEDULE C
TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT
BETWEEN THE BANK OF NEW YORK AND
FIDELITY FUNDS DATED AS OF MAY 11, 1995
The following is a list of Repo Custodians of the Funds:
The Bank of New York
Chemical Bank
Morgan Guaranty Trust Company
Exhibit g(14)
Form of
FIRST AMENDMENT TO
JOINT TRADING ACCOUNT CUSTODY AGREEMENT
BETWEEN
THE BANK OF NEW YORK
AND
FIDELITY FUNDS
FIRST AMENDMENT TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT BETWEEN
THE BANK OF NEW YORK AND FIDELITY FUNDS, dated as of _______, by and
between THE BANK OF NEW YORK ("Custodian") and each of the entities
listed on SchedulesA-1, A-2, A-3 and A-4 hereto on behalf of itself
or, (i) in the case of a series company, on behalf of one or more of
its portfolios or series listed on SchedulesA-1 or A-2 hereto, (ii) in
the case of the accounts listed on Schedule A-3 hereto, acting through
Fidelity Management & Research Company, and (iii)in the case of the
commingled or individual accounts listed on Schedule A-4 hereto,
acting through Fidelity Management Trust Company (collectively, the
"Funds" and each, a "Fund").
WITNESSETH
WHEREAS, Custodian and certain of the Funds have entered into that
certain Joint Trading Account Custody Agreement between The Bank of
New York and Fidelity Funds, dated as of ______ (the "Agreement"),
pursuant to which the Funds have appointed the Custodian as its
custodian for the purpose of establishing and administering one or
more joint trading accounts or subaccounts thereof (individually, an
"Account" and collectively, the "Accounts") and holding cash and
securities for the Funds in connection with repurchase transactions
effected through the Accounts; and
WHEREAS, Seller and the Funds desire to amend the Agreement as set
forth below.
NOW, THEREFORE, in consideration of the premises and mutual promises
and covenants contained herein, the parties hereto agree as follows.
Unless otherwise defined herein or the context otherwise requires,
terms used in this Amendment, including the preamble and recitals,
have the meanings provided in the Agreement.
The Agreement is hereby amended by deleting Paragraph2.03(f) in its
entirety and substituting the following in lieu thereof:
"(f) Overdraft. In the event that the Custodian is directed by
Proper Instructions to make any payment or transfer of funds on behalf
of a Fund for which there would be, at the close of business on the
date of such payment or transfer, insufficient funds held by the
Custodian on behalf of such Fund, the Custodian may, in its
discretion, provide an overdraft ("Overdraft") to the Fund (such Fund
being referred to herein as an "Overdraft Fund"), in an amount
sufficient to allow the completion of such payment or transfer. Any
Overdraft provided hereunder: (a) shall be payable on the next
Business Day, unless otherwise agreed by the Overdraft Fund and the
Custodian; and (b) shall accrue interest from the date of the
Overdraft to the date of payment in full by the Overdraft Fund at a
rate agreed upon in writing, from time to time, by the Custodian and
the Overdraft Fund. The Custodian and the Funds acknowledge that the
purpose of such Overdrafts is to temporarily finance the purchase or
sale of securities for prompt delivery in accordance with the terms
hereof. The Custodian hereby agrees to notify each Overdraft Fund by
3:00 p.m., New York time, of the amount of any Overdraft. Provided
that Custodian has given the notice required by this subparagraph (f),
the Funds hereby agree that, as security for the Overdraft of an
Overdraft Fund, the Custodian shall have a continuing lien and
security interest in and to all interest of such Overdraft Fund in
Securities whose purchase is financed by Custodian and which are in
Custodian's possession or in the possession or control of any third
party acting on Custodian's behalf and the proceeds thereof. In this
regard, Custodian shall be entitled to all the rights and remedies of
a pledgee under common law and a secured party under the New York
Uniform Commercial Code and any other applicable laws or regulations
as then in effect."
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
executed and delivered under seal by their duly authorized officers.
BANK OF NEW YORK
By: /s/
Name: Kurt D. Woetzel
Title: Senior Vice President
FIDELITY INVESTMENT COMPANIES LISTED
ON SCHEDULE A-1 HERETO AND ACCOUNTS
LISTED ON SCHEDULE A-3 HERETO
Dated:
By: /s/
Name: Kenneth A. Rathgeber
Title: Treasurer of the Fidelity Investment Companies
listed on ScheduleA-1 and Vice President of
Fidelity Management& Research Company
FIDELITY INVESTMENT COMPANIES LISTED
ON SCHEDULE A-2 HERETO
Dated:
By: /s/
Name: David J. Saul
Title: Director of the Fidelity International (Bermuda)
Funds Limited, on behalf of the Funds listed on
Schedule A-2
ACCOUNTS LISTED ON SCHEDULE A-4 HERETO
By: FIDELITY MANAGEMENT TRUST COMPANY
Dated:
By: /s/
Name: John P. O'Reilly, Jr.
Title: Executive Vice President
Exhibit g(15)
Form of
FIDELITY GROUP
REPO CUSTODIAN AGREEMENT
FOR JOINT TRADING ACCOUNT
AGREEMENT dated as of ________, among CHEMICAL BANK, a banking
corporation organized under the laws of the State of New York ("Repo
Custodian"), GREENWICH CAPITAL MARKETS, INC. ("Seller") and each of
the entities listed on Schedule A-1, A-2, A-3 and A-4 hereto acting on
behalf of itself or (i) in the case of a series company, on behalf of
one or more of its portfolios or series listed on Schedule A-1 or A-2
hereto, (ii) in the case of the accounts listed on Schedule A-3
hereto, acting through Fidelity Management & Research Company, and
(iii) in the case of the commingled or individual accounts listed on
Schedule A-4 hereto, acting through Fidelity Management Trust Company
(collectively, the "Funds" and each, a "Fund").
WITNESSETH
WHEREAS, each of the Funds has entered into a master repurchase
agreement dated as of _____________, (the "Master Agreement") with
Seller pursuant to which from time to time one or more of the Funds,
as buyers, and Seller, as seller, may enter into repurchase
transactions effected through one or more joint trading accounts
(collectively, the "Joint Trading Account") established and
administered by one or more custodians of the Funds identified on
Schedule C hereto (each a "Custodian"); and,
WHEREAS, in each such repurchase transaction Seller will sell to such
Funds certain Securities (as hereinafter defined) selected from
Eligible Securities (as hereinafter defined) held by Repo Custodian ,
subject to an agreement by Seller to repurchase such Securities; and
WHEREAS, Repo Custodian currently maintains a cash and securities
account (the "Seller Account") for Seller for the purpose of, among
other things, effecting repurchase transactions hereunder; and
WHEREAS, the Funds desire that the Repo Custodian serve as the
custodian for each of the Funds in connection with the repurchase
transactions effected hereunder, and that the Repo Custodian hold
cash, Cash Collateral (as hereinafter defined) and Securities for each
of the Funds for the purpose of effecting repurchase transactions
hereunder.
NOW THEREFORE, the parties hereto hereby agree as follows:
1. Definitions.
Whenever used in this Agreement, the following terms shall have the
meanings set forth below:
(a) "Banking Day" shall mean any day on which the Funds, Seller
Custodian, Repo Custodian, and the Federal Reserve Banks where the
Custodian and the Repo Custodian are located, are each open for
business.
(b) "Cash Collateral" shall mean all cash, denominated in U.S.
Dollars, credited by Repo Custodian to a Transaction Account pursuant
to Paragraphs 3, 6, 8 or 9 of the Master Agreement.
(c) "Custodian" shall have the meaning set forth in the preamble of
this Agreement.
(d) "Eligible Securities" shall mean those securities which are
identified as permissible securities for a particular Transaction
Category.
(e) "FICASH I Transaction" and "FICASH III Transaction" shall mean a
repurchase transaction in which the Repurchase Date is the Banking Day
next following the Sale Date and for which securities issued by the
government of the United States of America that are direct obligations
of the government of the United States of America shall constitute
Eligible Securities.
(f) "FICASH II Transaction" shall mean a repurchase transaction in
which the Repurchase Date is the Banking Day next following the Sale
Date and for which one or more of the following two categories of
securities, as specified by the Funds, shall constitute Eligible
Securities: (x) securities issued by the government of the United
States of America that are direct obligations of the government of the
United States of America, or (y) securities issued by or guaranteed as
to principal and interest by the government of the United States of
America, or by its agencies and/or instrumentalities, including, but
not limited to, the Federal Home Loan Bank, Federal Home Loan Mortgage
Corp., Government National Mortgage Association, Federal National
Mortgage Association, Federal Farm Credit Bank, Federal Intermediate
Credit Bank, Banks for Cooperatives, and Federal Land Banks.
(g) "FITERM I Transaction" and "FITERM III Transaction" shall mean a
repurchase transaction in which the Repurchase Date is a date fixed by
agreement between Seller and the Participating Funds which is not the
Banking Day next following the Sale Date, or if applicable, the date
fixed upon exercise of an Unconditional Resale Right (as hereinafter
defined) by the Participating Funds and for which securities issued by
the government of the United States of America that are direct
obligations of the government of the United States of America shall
constitute Eligible Securities.
(h) "FITERM II Transaction" shall mean a repurchase transaction in
which the Repurchase Date is a date fixed by agreement between Seller
and the Participating Funds which is not the Banking Day next
following the Sale Date, or, if applicable, the date fixed upon
exercise of an Unconditional Resale Right (as hereinafter defined) by
the Participating Funds and for which one or more of the following two
categories of securities, as specified by the Funds, shall constitute
Eligible Securities: (x) securities issued by the government of the
United States of America that are direct obligations of the government
of the United States of America, or (y) securities issued by or
guaranteed as to principal and interest by the government of the
United States of America, or by its agencies and/or instrumentalities,
including, but not limited to, the Federal Home Loan Bank, Federal
Home Loan Mortgage Corp., Government National Mortgage Association,
Federal National Mortgage Association, Federal Farm Credit Bank,
Federal Intermediate Credit Bank, Banks for Cooperatives, and Federal
Land Banks.
(i) "Fund" shall have the meaning set forth in the preamble of this
Agreement.
(j) "Fund Agent" shall mean the agent for the Participating Funds
designated in Paragraph 18 of the Master Agreement.
(k) "Joint Trading Account" shall have the meaning set forth in the
preamble of this Agreement.
(l) "Margin Percentage" with respect to any repurchase transaction
shall be 102% or such other percentage as is agreed to by Seller and
the Participating Funds (except that in no event shall the Margin
Percentage be less than 100%).
(m) "Market Value" shall have the meaning set forth in Paragraph 4 of
the Master Agreement.
(n) "Master Agreement" shall have the meaning set forth in the
preamble of this Agreement.
(o) "1940 Act" shall mean have the meaning set forth in Paragraph
3(c) of this Agreement.
(p) "Partial Payment" shall have the meaning set forth in Section
4(g) of this Agreement.
(q) "Participating Funds" shall mean those Funds that are parties to
a particular repurchase transaction effected through the Joint Trading
Account.
(r) "Pricing Rate" shall mean the per annum percentage rate agreed to
by Seller and the Participating Funds for a particular repurchase
transaction.
(s) "Pricing Services" shall have the meaning set forth in Paragraph
7 of this Agreement.
(t) "Repo Custodian" shall have the meaning set forth in the preamble
of this Agreement.
(u) "Repurchase Date" shall mean the date fixed by agreement between
Seller and the Participating Funds on which the Seller is to
repurchase Securities and Cash Collateral, if any, from the
Participating Funds and the Participating Funds are to resell the
Securities and Cash Collateral, if any, including any date determined
by application of the provisions of Paragraphs 7(a) and 15 of the
Master Agreement.
(v) "Repurchase Price" for each repurchase transaction shall mean the
Sale Price, plus an incremental amount determined by applying the
Pricing Rate to the Sale Price, calculated on the basis of a 360-day
year and the number of actual days elapsed from (and including) the
Sale Date to (but excluding) the Repurchase Date.
(w) "Sale Date" shall mean the Banking Day on which Securities and
Cash Collateral, if any, are to be sold to the Participating Funds by
Seller pursuant to a repurchase transaction hereunder.
(x) "Sale Price" shall mean the price agreed upon by the
Participating Funds and Seller at which the Securities and Cash
Collateral, if any, are to be sold to the Participating Funds by
Seller.
(y) "Securities" shall mean all Eligible Securities delivered by
Seller or to be delivered by Seller to the Participating Funds
pursuant to a particular repurchase transaction and not yet
repurchased hereunder, together with all rights related thereto and
all proceeds thereof.
(z) "Securities System" shall have the meaning set forth in Paragraph
3(c) of this Agreement.
(aa) "Seller" shall have the meaning set forth in the preamble to
this Agreement.
(bb) "Seller Account" shall have the meaning set forth in the
preamble of this Agreement.
(cc) "Transaction Account" shall mean a cash account established and
maintained by Repo Custodian for the Funds to effect repurchase
transactions pursuant to the Master Agreement.
(dd) "Transaction Category" shall mean the particular type of
repurchase transaction effected hereunder, as determined with
reference to the term of the transaction and the categories of
Securities that constitute Eligible Securities therefor, which term
shall include FICASH I Transactions, FICASH II Transactions, FICASH
III Transactions, FITERM I Transactions, FITERM II Transactions,
FITERM III Transactions, and such other transaction categories as may
from time to time be designated by the Funds by notice to Seller,
Custodian and Repo Custodian.
(ee) "Unconditional Resale Right" shall have the meaning set forth
in Paragraph 7(b) of the Master Agreement.
(ff) "Valuation Day" shall mean any day on which Repo Custodian is
open for business.
2. Appointment of Repo Custodian. Upon the terms and conditions set
forth in this Agreement, Repo Custodian is hereby appointed by the
Funds to act as the custodian for the Participating Funds to hold
cash, Cash Collateral and Securities for the purpose of effecting
repurchase transactions for the Participating Funds through the Joint
Trading Account pursuant to the Master Agreement. Repo Custodian
hereby acknowledges the terms of the Master Agreement between the
Funds and Seller (attached as an Exhibit hereto), as amended from time
to time, and agrees to abide by the provisions thereof to the extent
such provisions relate to the responsibilities and operations of Repo
Custodian hereunder.
3. Maintenance of Transaction Accounts.
(a) Repo Custodian shall establish and maintain one or more
Transaction Accounts for the purpose of effecting repurchase
transactions hereunder for the Funds, in each case pursuant to the
Master Agreement. From time to time the Funds may cause Custodian, on
behalf of the Funds, to deposit Securities and cash with Repo
Custodian in the designated Transaction Account, in each case in
accordance with Paragraph 3 of the Master Agreement.
(b) Repo Custodian shall keep all Securities, cash and Cash
Collateral received for the Participating Funds segregated at all
times from those of any other person, firm or corporation in its
possession and shall identify all such Securities, cash and Cash
Collateral as subject to this Agreement and the Master Agreement.
Segregation may be accomplished by physical segregation with respect
to certificated securities held by the Repo Custodian and, in
addition, by appropriate identification on the books and records of
Repo Custodian in the case of all other Securities, cash and Cash
Collateral. Title to all Securities and Cash Collateral under a
repurchase transaction shall pass to the Participating Funds that are
parties to such repurchase transaction. All such Securities and Cash
Collateral shall be held by Repo Custodian for the Participating
Funds, and shall be subject at all times to the proper instructions of
the Participating Funds, or the Custodian on behalf of the
Participating Funds, with respect to the holding, transfer or
disposition of such Securities and Cash Collateral. Repo Custodian
shall include in its records for each Transaction Account all
instructions received by it which evidence an interest of the
Participating Funds in the Securities and Cash Collateral and shall
hold physically segregated any written agreement, receipt or other
writing received by it which evidences an interest of the
Participating Funds in the Securities and Cash Collateral.
(c) Any requirement to "deliver" or "transfer" cash or Cash
Collateral to the Participating Funds or to "credit" a Transaction
Account under this or any other paragraph of this Agreement shall be
made in immediately available funds. If Repo Custodian is required to
"deliver" or "transfer" Securities to the Participating Funds under
this or any other paragraph of this Agreement, Repo Custodian shall
take, or cause to be taken, the following actions to perfect the
Participating Funds' interest in such Securities as an outright
purchaser: (i) in the case of certificated securities and instruments
held by Seller, by physical delivery of the share certificates or
other instruments representing the Securities and by physical
segregation of such certificates or instruments from the Repo
Custodian's other assets in a manner indicating that the Securities
are being held for the Participating Funds (such securities and
instruments to be delivered in form suitable for transfer or
accompanied by duly executed instruments of transfer or assignment in
blank and accompanied by such other documentation as the Participating
Funds may request), (ii) in the case of Securities held in a customer
only account in a clearing agency or federal book-entry system
authorized for use by the Funds and meeting the requirements of Rule
17f-4 under the Investment Company Act of 1940, as amended (the "1940
Act") (such authorized agency or system being referred to herein as a
"Securities System"), by appropriate entry on the books and records of
Repo Custodian identifying the Securities as belonging to the
Participating Funds, or (iii) in the case of Securities held in Repo
Custodian's own account in a Securities System, by transfer to a
customer only account in the Securities System and by appropriate
entry on the books and records of Repo Custodian identifying such
Securities as belonging to the Participating Funds; provided, further,
that Repo Custodian shall confirm to the Participating Funds the
identity of the Securities transferred or delivered. Acceptance of a
"due bill", "trust receipt" or similar receipt or notification of
segregation issued by a third party with respect to Securities held by
such third party shall not constitute good delivery of Securities to
Repo Custodian for purposes of this Agreement or the Master Agreement
and shall expressly violate the terms of this Agreement and the Master
Agreement. The Funds shall identify by notice to Repo Custodian and
Seller those agencies or systems which have been approved by the Funds
for use under this Agreement and the Master Agreement. The Funds
hereby notify Repo Custodian and Seller that the following agencies
and systems have been approved by the Funds for use under this
Agreement and the Master Agreement, until such time as Repo Custodian
and Seller shall have been notified by the Funds to the contrary: (i)
Participants Trust Company; (ii) The Depository Trust Company; and
(iii) any book-entry system as provided in (A) Subpart O of Treasury
Circular No. 300, 31 CFR 306.115, (B) Subpart B of Treasury Circular
Public Debt Series No. 27-76, 31 CFR 350.2, or (C) the book-entry
regulations of federal agencies substantially in the form of 31 CFR
306.115.
4. Repurchase Transactions.
(a) Repo Custodian shall make all credits and debits to the
Transaction Account and effect the transfer of Securities to or from
the Participating Funds upon proper instructions received from the
Participating Funds, or the Custodian on behalf of the Participating
Funds, and shall make all credits and debits to the Seller Account and
effect the transfer of Securities to or from the Seller upon proper
instructions received from Seller. In the event that Repo Custodian
receives conflicting proper instructions from Seller and the
Participating Funds, or the Custodian on behalf of the Participating
Funds, Repo Custodian shall follow the Participating Funds' or the
Custodian's proper instructions. The Participating Funds shall give
Repo Custodian only such instructions as shall be permitted by the
Master Agreement. Notwithstanding the preceding sentence, the
Participating Funds, or the Custodian on behalf of the Participating
Funds, may from time to time instruct Repo Custodian to transfer cash
from the Transaction Account to Custodian so long as such transfer is
not in contravention of the Master Agreement.
(b) (i) Whenever on any Banking Day one or more Funds and Seller agree
to enter into a repurchase transaction, Seller and the Participating
Funds, or the Custodian on behalf of the Participating Funds, will
give Repo Custodian proper instructions by telephone or otherwise by
5:00 p.m. New York time on the Sale Date, specifying the Transaction
Category, Repurchase Date, Sale Price, Repurchase Price or the
applicable Pricing Rate and the Margin Percentage for each such
repurchase transaction.
(ii) In the case of repurchase transactions in which the Repurchase
Date is the Banking Day next following the Sale Date (x) the
Participating Funds may increase or decrease the Sale Price for any
such repurchase transaction by no more than 10% of the initial Sale
Price by causing to be delivered further proper instructions by
telephone or otherwise to Repo Custodian by 5:15 p.m. New York time
(or at such later time as may be agreed upon by the parties) on the
Sale Date and (y) Seller and the Participating Funds may by mutual
consent agree to increase or decrease the Sale Price by more than 10%
of the initial Sale Price by causing to be provided further proper
instructions to Repo Custodian by the close of business on the Sale
Date. In any event, Repo Custodian shall not be responsible for
determining whether any such increase or decrease of the Sale Price
exceeds the 10% limitation.
(c) Seller will take such actions as are necessary to ensure that on
the Sale Date the aggregate Market Value of all Securities held by
Repo Custodian for Seller and cash in the Seller Account equals or
exceeds the Margin Percentage of the Sale Price. Seller shall give
Repo Custodian proper instructions specifying with respect to each of
the Securities which is to be the subject of a repurchase transaction
(a) the name of the issuer and the title of the Securities, and (b)
the Market Value of such Securities. Such instructions shall
constitute Seller's instructions to Repo Custodian to transfer the
Securities to the Participating Funds and/or Cash Collateral from the
Seller Account to the Transaction Account.
(d) By 5:00 p.m. New York Time on the Sale Date, the Participating
Funds shall transfer to, or maintain on deposit with, Repo Custodian
in the Transaction Account immediately available funds in an amount
equal to the Sale Price with respect to a particular repurchase
transaction.
(e) Prior to the close of business on the Sale Date, Repo Custodian
shall transfer Securities from Seller to the Participating Funds
and/or cash held in the Seller Account to the Transaction Account and
shall transfer to the Seller Account immediately available funds from
the Transaction Account in accordance with the following provisions:
(i) Repo Custodian shall determine that all securities to be
transferred by Seller to the Participating Funds are Eligible
Securities. Any securities which are not Eligible Securities for a
particular repurchase transaction hereunder shall not be included in
the calculations set forth below and shall not be transferred to the
Participating Funds.
(ii) Repo Custodian shall then calculate the aggregate Market Value
of the Securities and cash, if any, to be so transferred.
(iii) Repo Custodian shall notify Seller in the event that the
aggregate Market Value of Securities and cash, if any, applicable to
the repurchase transaction is less than the Margin Percentage of the
Sale Price and Seller shall transfer, by the close of business on the
Sale Date, to Repo Custodian additional Securities and/or cash in the
amount of such deficiency. If Seller does not, by the close of
business on the Sale Date, transfer additional Securities and/or cash,
the Market Value of which equals or exceeds such deficiency, Repo
Custodian may, at its option, without notice to Seller, advance the
amount of such deficiency to Seller in order to effectuate the
repurchase transaction. It is expressly agreed that Repo Custodian is
not obligated to make an advance to Seller to enable it to complete
any repurchase transaction.
(iv) Subject to the provisions of Subparagraph (v) below, Repo
Custodian shall cause the Securities applicable to the repurchase
transaction received from Seller to be transferred to the
Participating Funds and shall cause any cash received from Seller to
be transferred to the Transaction Account, against transfer of the
Sale Price from the Transaction Account to the Seller Account, such
transfers of Securities and/or cash and funds to be deemed to occur
simultaneously.
(v) Notwithstanding anything to the contrary, if, for any repurchase
transaction, the amount of immediately available funds in the
Transaction Account is less than the agreed upon Sale Price in
connection with the repurchase transaction immediately prior to
effectuating such repurchase transaction, or if the aggregate Market
Value of the Securities and cash, if any, applicable to such
repurchase transaction is less than the Sale Price multiplied by the
Margin Percentage immediately prior to effectuating such repurchase
transaction, Repo Custodian shall effect the repurchase transaction to
the best of its ability by transferring Securities from Seller to the
Participating Funds and/or cash from the Seller Account to the
Transaction Account with an aggregate Market Value equal to the lesser
of (x) the amount of immediately available funds in the Transaction
Account multiplied by the Margin Percentage and (y) the aggregate
Market Value of the Securities available for transfer from Seller to
the Participating Funds and cash, if any, in the Seller Account,
against the transfer of immediately available funds from the
Transaction Account to the Seller Account in an amount equal to the
aggregate Market Value of the Securities and/or cash to be transferred
divided by the Margin Percentage; provided, however, that in either
such event Repo Custodian shall have the right not to transfer to the
Participating Funds such Securities and not to transfer such cash, if
any, to the Transaction Account and not to transfer from the
designated Transaction Account such funds as Repo Custodian
determines, in its sole discretion, will not be the subject of a
repurchase transaction. The actions of Repo Custodian pursuant to
this subparagraph (e)(v) shall not affect the obligations and
liabilities of the parties to each other pursuant to the Master
Agreement with regard to such repurchase transaction.
(f) In the event that on a Banking Day Seller desires to substitute
Securities applicable to such repurchase transaction with Eligible
Securities and/or Cash Collateral (to the extent provided in the
Master Agreement), Repo Custodian shall perform such substitution in
accordance with the following provisions:
(i) Repo Custodian shall determine that all securities to be
transferred to the Participating Funds are Eligible Securities. Any
securities which are not eligible for repurchase transactions
hereunder shall not be included in the calculations set forth below
and shall not be transferred to the Participating Funds.
(ii) Repo Custodian shall then calculate the aggregate Market Value
of the Eligible Securities and/or Cash Collateral to be transferred.
Repo Custodian shall not make any substitution if, at the time of
substitution, the aggregate Market Value of all Securities and any
Cash Collateral applicable to such repurchase transaction immediately
after such substitution would be less than the Margin Percentage of
the Repurchase Price (calculated as if the Repurchase Date were the
date of substitution).
(iii) Repo Custodian shall then deliver to the Seller, subject to the
qualifications set forth above, the Securities to be substituted
against the delivery by Repo Custodian of substitute Eligible
Securities to the Participating Funds and/or the crediting of the
Transaction Account with Cash Collateral.
(iv) In the event Seller has caused Repo Custodian to credit the
Transaction Account with Cash Collateral in lieu of substitute
Eligible Securities, and has failed to deliver Eligible Securities
against such Cash Collateral not later than the close of business on
such Banking Day in accordance with the terms of the Master Agreement,
Repo Custodian shall promptly, but in no event later than 10:00 a.m.
the following Banking Day, notify the Participating Funds and Seller
of such failure.
(g) With respect to each repurchase transaction, at 9:00 a.m. New
York time, or at such other time as specified in proper instructions
of the Participating Funds (or the Custodian on behalf of the
Participating Funds) on the Repurchase Date, Repo Custodian shall
debit the Seller Account and credit the Transaction Account in the
amount of the Repurchase Price and shall transfer Securities from the
Participating Funds to the Seller and Cash Collateral, if any, from
the Transaction Account to the Seller Account in accordance with the
following provisions:
(i) If the amount of available funds in the Seller Account equals or
exceeds the Repurchase Price, Repo Custodian shall debit the Seller
Account and credit the Transaction Account in the amount of the
Repurchase Price and shall transfer all Securities applicable to such
repurchase transaction from the Participating Funds to the Seller and
debit the Transaction Account and credit the Seller Account in the
amount of any Cash Collateral applicable to such repurchase
transaction.
(ii) If the amount of available funds in the Seller Account is less
than the Repurchase Price, then Repo Custodian shall notify the Seller
of the amount of the deficiency and Seller shall promptly cause such
amount to be transferred to the Seller Account. If Seller fails to
cause the transfer of the entire amount of the deficiency to the
Seller Account, then Repo Custodian may, at its option and without
notice to Seller, advance to Seller the amount of such remaining
deficiency. It is expressly agreed that Repo Custodian is not
obligated to make any advance to Seller. If, following such transfer
and/or advance, the amount of available funds in the Seller Account
equals or exceeds the Repurchase Price then Repo Custodian shall debit
the Seller Account and credit the Transaction Account in the amount of
the Repurchase Price and shall transfer from the Participating Funds
to the Seller all Securities applicable to such repurchase transaction
and debit the Transaction Account and credit the Seller Account in the
amount of any Cash Collateral applicable to such repurchase
transaction.
(iii) If the Seller fails to cause the transfer of the entire amount
of the deficiency, as required by (ii) above, and Repo Custodian fails
to advance to Seller an amount sufficient to eliminate the entire
deficiency, then Repo Custodian shall debit the Seller Account in the
amount of all immediately available funds designated by Seller as
applicable to the repurchase transaction and credit the Transaction
Account in such amount (such amount being referred to as the "Partial
Payment") and shall transfer Securities from the Participating Funds
to the Seller such that the aggregate Market Value of all remaining
Securities and Cash Collateral in the Transaction Account with respect
to such repurchase transaction shall at least equal the difference
between Margin Percentage of the Repurchase Price and the Partial
Payment.
5. Payments on Securities. Repo Custodian shall credit to the Seller
Account as soon as received, all principal, interest and other sums
paid by or on behalf of the issuer in respect of the Securities and
collected by Repo Custodian, except as otherwise provided in Paragraph
8 of the Master Agreement.
6. Daily Statement. On each Banking Day on which any Participating
Funds have an outstanding repurchase transaction, Repo Custodian shall
deliver by facsimile, or other electronic means acceptable to the
Participating Funds, the Custodian and the Repo Custodian, to
Custodian and to the Participating Funds a statement identifying the
Securities held by Repo Custodian with respect to such repurchase
transaction and the cash and Cash Collateral, if any, held by Repo
Custodian in the Transaction Account, including a statement of the
then current Market Value of such Securities and the amounts, if any,
credited to the Transaction Account as of the close of trading on the
previous Banking Day. Repo Custodian shall also deliver to Custodian
and the Participating Funds such additional statements as the Repo
Custodian and the Participating Funds may agree upon from time to
time.
7. Valuation.
(a) Repo Custodian shall confirm the Market Value of Securities and
the amount of Cash Collateral, if any (i) on the Sale Date prior to
transferring the Sale Price out of the Transaction Account to the
Seller Account against the receipt from Seller of the Securities and
Cash Collateral, if any, and (ii) on each Valuation Day on which such
repurchase transaction is outstanding. If on any Valuation Day the
aggregate Market Value of the Securities and Cash Collateral with
respect to any repurchase transaction is less than the Margin
Percentage of the Repurchase Price (calculated as if the Repurchase
Date were such Valuation Day) for such transaction, Repo Custodian
shall promptly, but in any case no later than 10:00 a.m. the following
Valuation Day, notify Seller. If on any Valuation Day the aggregate
market value of the Securities and Cash Collateral with respect to any
repurchase transaction is less than the Margin Percentage of the
Repurchase Price (calculated as if the Repurchase Date were such
Valuation Day) for such transaction, and Seller fails to deliver
additional Eligible Securities applicable to such repurchase
transaction or an additional amount of Cash Collateral by the close of
business on such Valuation Day such that the aggregate market value of
the Securities and Cash Collateral at least equals the Margin
Percentage of the Repurchase Price (calculated as if the Repurchase
Date were such Valuation Day), Repo Custodian shall promptly, but in
any event no later than 10:00 a.m. the following Valuation Day, notify
the Participating Funds of such failure.
(b) Repo Custodian shall determine the bid side portion of the Market
Value of the Securities by reference to the independent pricing
services ("Pricing Services") set forth on Schedule B. It is
understood and agreed that Repo Custodian shall use the prices made
available by the Pricing Services at the close of business of the
preceding Valuation Day. In the event that Repo Custodian is unable
to obtain a valuation of any Securities from the Pricing Services,
Repo Custodian shall request a bid quotation from a broker's broker or
a broker dealer, set forth in Schedule B, other than Seller. In the
event Repo Custodian is unable to obtain a bid quotation for any
Securities from such a broker's broker or a broker dealer, Repo
Custodian (i) shall not include any such Securities in the
determination of whether the aggregate Market Value of the Securities
and any Cash Collateral equals at least the Margin Percentage of the
Repurchase Price and (ii) shall redeliver such Securities to Seller if
the Market Value of all other Securities and any Cash Collateral with
respect to such repurchase transaction equals at least the Margin
Percentage of the Repurchase Price (calculated as if the Repurchase
Date were such Valuation Day). The Repo Custodian may rely on prices
quoted by Pricing Services, broker's brokers or broker dealers, except
Seller, as set forth in Schedule B.
(c) (i) If, on any Valuation Day, the aggregate Market Value of the
Securities and any Cash Collateral with respect to a repurchase
transaction is less than the Margin Percentage of the Repurchase Price
(calculated as if the Repurchase Date were such Valuation Day)
applicable to such repurchase transaction, Repo Custodian shall
deliver to the Participating Funds an amount of additional Eligible
Securities applicable to such repurchase transaction and/or debit the
Seller Account and credit the Transaction Account with an additional
amount of Cash Collateral, such that the aggregate Market Value of all
Securities and any Cash Collateral with respect to such repurchase
transaction shall equal at least the Margin Percentage of the
Repurchase Price (calculated as if the Repurchase Date were such
Valuation Day) applicable to such repurchase transaction.
(ii) If, on any Valuation Day, the aggregate Market Value of the
Securities and any Cash Collateral with respect to a repurchase
transaction exceeds the Margin Percentage of the Repurchase Price
(calculated as if the Repurchase Date were such Valuation Day)
applicable to such repurchase transaction, Repo Custodian shall return
to the Seller all or a portion of such Securities or Cash Collateral,
if any; provided that the Market Value of the remaining Securities and
any Cash Collateral with respect to the repurchase transaction shall
be at least equal to the Margin Percentage of the Repurchase Price
(calculated as if the Repurchase Date were such Valuation Day)
applicable to such repurchase transaction. At any time and from time
to time with respect to any repurchase transaction, if authorized by
the Participating Funds, or the Custodian on behalf of the
Participating Funds, the Repo Custodian shall debit the Transaction
Account by an amount of Cash Collateral and credit the Seller Account
by the same amount of Cash Collateral against simultaneous delivery
from Seller to the Participating Funds of Eligible Securities
applicable to such repurchase transaction with a Market Value at least
equal to the amount of Cash Collateral credited and debited.
8. Authorized Persons. Schedule C hereto sets forth those persons
who are authorized to act for Repo Custodian, Custodian, Seller and
the Funds, respectively, under this Agreement.
9. Proper Instructions. Proper instructions shall mean a tested
telex, facsimile, a written request, direction, instruction or
certification signed or initialed by or on behalf of the party giving
the instructions by one or more authorized persons (as provided in
Paragraph 8); provided, however, that no instructions directing the
delivery of Securities or the payment of funds to any individual who
is an authorized signatory of Custodian or Repo Custodian shall be
signed by that individual. Telephonic, other oral or
electro-mechanical or electronic instructions (including the code
which may be assigned by Repo Custodian to Custodian from time to
time) given by one of the above authorized persons shall also be
considered proper instructions if the party receiving such
instructions reasonably believes them to have been given by an
authorized person with respect to the transaction involved. Oral
instructions will be confirmed by tested telex, facsimile or in
writing in the manner set forth above. The Funds and Seller authorize
Repo Custodian to tape record any and all telephonic or other oral
instructions given to Repo Custodian. Proper instructions may relate
to specific transactions or to types or classes of transactions, and
may be in the form of standing instructions.
10. Standard of Care.
(a) Repo Custodian shall be obligated to use reasonable care and
diligence in carrying out the provisions of this Agreement and the
Master Agreement and shall be liable to the Funds and/or Seller only
for direct damages resulting from the negligence or willful misconduct
of the Repo Custodian or its officers, employees or agents. The
parties hereby agree that Repo Custodian shall not be liable for
consequential, special or indirect damages, even if Repo Custodians
has been advised as to the possibility thereof. So long as and to the
extent that Repo Custodian exercises reasonable care and diligence and
acts without negligence, misfeasance or misconduct, Repo Custodian
shall not be liable to Seller or the Funds for (i) any action taken or
omitted in good faith in reliance upon proper instructions, (ii) any
action taken or omitted in good faith upon any notice, request,
certificate or other instrument reasonably believed by it to be
genuine and to be signed by the proper party or parties, (iii) any
delay or failure to act as may be required under this Agreement or
under the Master Agreement when such delay or failure is due to any
act of God or war, (iv) the actions or omissions of a Securities
System, (v) the title, validity or genuineness of any security
received, delivered or held by it pursuant to this Agreement or the
Master Agreement, (vi) the legality of the purchase or sale of any
Securities by or to the Participating Funds or Seller or the propriety
of the amount for which the same are purchased or sold (except to the
extent of Repo Custodian's obligations hereunder to determine whether
securities are Eligible Securities and to calculate the Market Value
of Securities and any Cash Collateral), (vii) the due authority of any
person listed on Schedule C to act on behalf of Custodian, Seller or
the Funds, as the case may be, with respect to this Agreement or
(viii) the errors of the Pricing Services, broker's brokers or broker
dealers set forth in Schedule B.
(b) Repo Custodian shall not be liable to Seller or the Funds for, or
considered to be the custodian of, any Eligible Securities or any
money to be used in a repurchase transaction, whether or not such
money is represented by any check, draft, or other instrument for the
payment of money, until the Eligible Securities have been delivered in
accordance with Paragraph 3 or until Repo Custodian actually receives
and collects such money on behalf of Seller or the Funds directly or
by the final crediting of the Seller Account or a Transaction Account
through the Securities System, except that this Paragraph 10(b) shall
not be deemed to limit the liability of Repo Custodian to Seller or
the Funds if the non-delivery of such Eligible Securities or the
failure to receive and collect such money results from the breach by
Repo Custodian of its obligations under this Agreement or the Master
Agreement.
(c) Repo Custodian shall not be under any duty or obligation to
ascertain whether any Securities at any time delivered to or held by
it are such as properly may be held by the Participating Funds;
provided that notwithstanding anything to the contrary herein, Repo
Custodian shall be obligated to act in accordance with the guidelines
and proper instructions of the Participating Funds, or the Custodian
on behalf of the Participating Funds, with respect to the types of
Eligible Securities and the issuers of such Eligible Securities that
may be used in specific repurchase transactions.
(d) Repo Custodian promptly shall notify the Fund Agent and the
Custodian if Securities held by Repo Custodian are in default or if
payment on any Securities has been refused after due demand and
presentation and Repo Custodian shall take action to effect collection
of any such amounts upon the proper instructions of the Participating
Funds, or the Custodian on behalf of the Participating Funds, and
assurances satisfactory to it that it will be reimbursed for its costs
and expenses in connection with any such action.
(e) Repo Custodian shall have no duties, other than such duties as
are necessary to effectuate repurchase transactions in accordance with
this Agreement and the Master Agreement within the standard of care
set forth in Paragraph 10(a) above and in a commercially reasonable
manner.
11. Representations and Additional Covenants of Repo Custodian.
(a) Repo Custodian represents and warrants that (i) it is duly
authorized to execute and deliver this Agreement and to perform its
obligations hereunder and has taken all necessary action to authorize
such execution, delivery and performance, (ii) the execution, delivery
and performance of this Agreement do not and will not violate any
ordinance, declaration of trust, partnership agreement, articles of
incorporation, charter, rule or statute applicable to it or any
agreement by which it is bound or by which any of its assets are
affected, (iii) the person executing this Agreement on its behalf is
duly and properly authorized to do so, (iv) it has (and will maintain)
a copy of this Agreement and evidence of its authorization in its
official books and records, and (v) this Agreement has been executed
by one of its duly authorized officers at the level of Vice President
or higher.
(b) Repo Custodian further represents and warrants that (i) it has
not pledged, encumbered, hypothecated, transferred, disposed of, or
otherwise granted, any third party an interest in any Securities, (ii)
it does not have any security interest, lien or right of setoff in the
Securities, and (iii) it has not received notification from any third
party, in its capacity as Repo Custodian, custodian bank or clearing
bank, of any lien, claim, charge or encumbrance with respect to any
Securities that are the subject of such repurchase transaction. Repo
Custodian agrees that (i) it will not pledge, encumber, hypothecate,
transfer, dispose of, or otherwise grant, any third party an interest
in any Securities, (ii) it will not acquire any security interest,
lien or right of setoff in the Securities, and (iii) it will promptly
notify the Fund Agent, if, during the term of any outstanding
repurchase transaction, it is notified by any third party, in its
capacity as Repo Custodian, custodian bank or clearing bank, of the
Participating Funds or Seller, of the existence of any lien, claim,
charge or encumbrance with respect to any Securities that are the
subject of such repurchase transaction.
12. Indemnification.
(a) Notwithstanding the Participating Fund's obligation to the Repo
Custodian under Paragraph 12(b) below, so long as and to the extent
that Repo Custodian is in the exercise of reasonable care and
diligence and acts without negligence, misfeasance or misconduct,
Seller will indemnify Repo Custodian and hold it harmless against any
and all losses, claims, damages, liabilities or actions to which it
may become subject, and reimburse it for any expenses (including
attorneys' fees and expenses) incurred by it in connection therewith,
insofar as such losses, claims, damages, liabilities or actions arise
out of or are based upon or in any way related to this Agreement, the
Master Agreement or any transactions contemplated hereby or thereby or
effected hereunder or thereunder. Without limiting the generality of
the foregoing indemnification, Repo Custodian shall be indemnified by
Seller for all costs and expenses, including attorneys' fees, for its
successful defense against claims that Repo Custodian breached its
standard of care and was negligent or engaged in misfeasance or
misconduct.
(b) So long as and to the extent that Repo Custodian is in the
exercise of reasonable care and diligence and acts without negligence,
misconduct or misfeasance, the Participating Funds will indemnify Repo
Custodian and hold it harmless against any and all losses, claims,
damages, liabilities or actions to which it may become subject, and
reimburse it for any expenses (including attorneys' fees and expenses)
incurred by it in connection therewith, insofar as such losses,
claims, damages, liabilities or actions result from the negligence,
misconduct or misfeasance of the Participating Funds under this
Agreement.
13. Rights and Remedies. The rights and remedies conferred upon the
parties hereto shall be cumulative, and the exercise or waiver of any
thereof shall not preclude or inhibit the exercise of any additional
rights and remedies.
14. Modification or Amendment. Except as otherwise provided in this
Paragraph 14, no modification, waiver or amendment of this Agreement
shall be binding unless in writing and executed by the parties hereto.
Schedule A, listing the Funds, may be amended from time to time to add
or delete Funds by the Funds (i) delivering an executed copy of an
addendum to Schedule A to Seller and Repo Custodian, and (ii)
amending Schedule A to the Master Agreement in accordance with the
provisions therein. The amendment of Schedule A as provided above
shall constitute appointment of Repo Custodian as a custodian for such
Fund. Schedule B may be amended from time to time by an instrument in
writing, or counterpart thereof, executed by Repo Custodian, Seller
and the Funds. Schedule C may be amended from time to time to change
an authorized person of: (i) the Funds, by written notice to Repo
Custodian and Seller by Ms. Sarah Zenoble or the Treasurer of the
Funds (or such persons who may be authorized from time to time in
writing by Ms. Zenoble or the President or Treasurer of Fidelity
Management and Research Company to trade on behalf of Fidelity's
taxable money market funds); (ii) Seller, by written notice to Repo
Custodian and the Funds by any Vice President of Seller; (iii) Repo
Custodian, by written notice to Seller, Custodian and the Funds by any
Vice President of Repo Custodian; and (iv) Custodian, by written
notice to Repo Custodian by any Vice President of Custodian. Schedule
D may be amended from time to time by any party hereto by delivery of
written notice to the other parties hereto. Repo Custodian shall
receive notice of any amendment to the Master Agreement at the address
set forth in Schedule D hereto; and, if such amendment would have a
material adverse effect on the rights of, or would materially increase
the obligations of Repo Custodian under this Agreement, any such
amendment shall also require the consent of Repo Custodian. Any such
amendment shall be deemed not to be material if Repo Custodian fails
to object in writing within 21 days after receipt of notice thereof.
No amendment to this Agreement shall affect the rights or obligations
of any Fund with respect to any outstanding repurchase transaction
entered into under this Agreement and the Master Agreement prior to
such amendment or with respect to any actions or omissions by any
party hereto prior to such amendment. In the event of conflict
between this Agreement and the Master Agreement, the Master Agreement
shall control.
15. Termination. This Agreement shall terminate forthwith upon
termination of the Master Agreement or may be terminated by any party
hereto on ten Valuation Days' written notice to the other parties;
provided, however, that any such termination shall not affect any
repurchase transaction then outstanding or any rights or obligations
under this Agreement or the Master Agreement with respect to any
actions or omissions of any party hereto prior to termination. In the
event of termination, Repo Custodian will deliver any Securities, Cash
Collateral or cash held by it or any agent to Custodian or to such
successor custodian or custodian or subcustodian as the Participating
Funds shall instruct.
16. Compensation. Seller agrees to pay Repo Custodian compensation
for the services to be rendered hereunder, based upon rates which
shall be agreed upon from time to time.
17. Notices. Except with respect to communications between Custodian
and the Funds which shall be governed by the custodian agreement or
subcustodian agreement between such parties, as the case may be, and
except as otherwise provided herein or as the parties to the Agreement
shall from time to time otherwise agree, all instructions, notices,
reports and other communications contemplated by this Agreement shall
be given to the party entitled to receive such notice at the telephone
number and address listed on Schedule D hereto.
18. Severability. If any provision of this Agreement is held to be
unenforceable as a matter of law, the other terms and provisions
hereof shall not be affected thereby and shall remain in full force
and effect.
19. Binding Nature. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their successors and
assignees; provided that, no party hereto may assign this Agreement or
any of the rights or obligations hereunder without the prior written
consent of the other parties.
20. Headings. Section headings are for reference purposes only and
shall not be construed as a part of this Agreement.
21. Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one
instrument.
22. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
23. Limitation of Liability. Repo Custodian and Seller are hereby
expressly put on notice of the limitation of liability set forth in
the Declarations of Trust and in the Certificates and Agreements of
Limited Partnership of the Funds and agree that the obligations
assumed by any Fund hereunder shall be limited in all cases to a Fund
and its assets or, in the case of a series Fund, to the assets of that
series only, and neither Seller, Repo Custodian nor their respective
agents or assigns shall seek satisfaction of any such obligation from
the officers, agents, employees, directors, trustees, shareholders or
partners of any such Fund or series.
24. Rights and Obligations of Each Fund. The rights and obligations
set forth in this Agreement with respect to each repurchase
transaction shall accrue only to the Participating Funds in accordance
with their respective interests therein. No other Fund shall receive
any rights or have any liabilities arising from any action or inaction
of any Participating Fund under this Agreement with respect to such
repurchase transaction.
25. General Provisions. This Agreement supersedes any other
custodian agreement by and among Seller, the Funds, and Repo Custodian
concerning repurchase transactions effected through the Joint Trading
Account. It is understood and agreed that time is of the essence with
respect to the performance of each party's respective obligations
hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
[Signature Lines Omitted]
SCHEDULE B
PRICING SOURCES
PRICING SERVICES
U.S. Government Securities Interactive Data Services or Mellon Data
Services (or any other pricing service mutually agreed upon by Seller
and the Funds)
GNMA - The Bond Buyer
FHLMC - The Bond Buyer
All other U.S. Government
and Agency Securities Interactive Data Services or Mellon Data
Services (or any other pricing service mutually agreed upon by Seller
and the Funds)
BROKERS' BROKERS AND BROKER DEALERS
U.S. Government Securities - Any Primary Dealer
GNMA - Any Primary Broker-Dealer's bid rate for such security
FHLMC - Any Primary Broker-Dealer's bid rate for such security
All other U.S. Government and Agency Securities - Any Primary
Broker-Dealer's bid rate for such security
Prices shall be as of the business day immediately preceding the date
of determination or the last quote available. The pricing services,
Brokers' Brokers and Broker Dealers may be changed from time to time
by agreement of all the parties.
SCHEDULE C
AUTHORIZED PERSONS
Repo Custodian
Anthony Isola
Raymond Stancil
William Mosca
Leonardo Nichols
Alan Mann
Allen B. Clark
Custodian
Ken Rindos
Kurt Woetzel
Seller
Gary F. Holloway
Konrad R. Kruger
Stephen M. Peet
Raymond E. Humiston
P. Michael Florio
Ben Carpenter
Blake S. Drexler
Derick B. Burgher
Lyn Kratovil
The Funds
Leland Barron
Wickliffe Curtis
Dorothy Egan
David Glocke
Katharyn Harlow
Timothy Huyck
Jon Jamen
Robert Litterst
Sam Silver
Burnell Stehman
Jeffrey St. Peters
Deborah Todd
John Todd
Joseph Torres
Richard Williams
SCHEDULE D
NOTICES
If to Custodian: Morgan Guaranty Trust Co. of New York
15 Broad Street, 16th Floor
New York, New York 10015
Telephone: (212) 483-4150
Attention: Ms. Kimberly Smith
or
The Bank of New York
One Wall Street, 4th Floor
New York, NY 10286
Telephone: (312) 635-4808
Attention: Claire Meskovic
With a copy to the Fund Agent
If to Repo Custodian: Chemical Bank
4 New York Plaza
21st Floor
New York, NY 10004-2477
Telephone: (212) 623-6446
Attention: Anthony Isola
If to Seller: Greenwich Capital Markets, Inc.
600 Steamboat Road
Greenwich, Connecticut 06830
Telephone: (203) 625-7909
Attention: Peter Sanchez
If to any of the Funds: FMR Texas Inc.
400 East Las Colinas Blvd., CP9M
Irving, Texas 75039
Telephone: (214) 584-7800
Attention: Ms. Deborah R. Todd or
Mr. Samuel Silver
If to the Fund Agent: Fidelity Investments
[Name of Fund]
400 East Las Colinas Blvd., CP9E
Irving, Texas 75039
Telephone: (214) 584-4071
Attention: Mr. Mark Mufler
277262.c1
Exhibit g(15)
FORM OF
SCHEDULE 1
The following lists the additional counterparties to the Repo
Custodian Agreement for Joint Trading Account between Chemical Bank
and the Fidelity Funds:
Chase Securities, Inc.
CS First Boston Corp.
Dresdner Securities (U.S.A.), Inc.
HSBC Securities, Inc.
Lehman Government Securities, Inc.
Merrill Lynch Government Securities, Inc.
Paine Webber, Inc.
Salomon Brothers, Inc.
UBS Securities, Inc.
Exhibit g(16)
Form of
CUSTODIAN AGREEMENT
Between
Each of the Investment Companies
Listed on Appendix "A" Attached Hereto
and
Brown Brothers Harriman & Company
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
ARTICLE Page
I. APPOINTMENT OF CUSTODIAN 1
II. POWERS AND DUTIES OF CUSTODIAN 1
2.01 Safekeeping 1
2.02 Manner of Holding Securities 1
2.03 Security Purchases 2
2.04 Exchanges of Securities 2
2.05 Sales of Securities 3
2.06 Depositary Receipts 3
2.07 Exercise of Rights; Tender Offers 3
2.08 Stock Dividends, Rights, Etc. 3
2.09 Options 4
2.10 Futures Contracts 4
2.11 Borrowing 4
2.12 Interest Bearing Deposits 5
2.13 Foreign Exchange Transactions 5
2.14 Securities Loans 5
2.15 Collections 6
2.16 Dividends, Distributions and Redemptions 6
2.17 Proceeds from Shares Sold 6
2.18 Proxies, Notices, Etc. 6
2.19 Bills and Other Disbursements 7
2.20 Nondiscretionary Functions 7
2.21 Bank Accounts 7
2.22 Deposit of Fund Assets in Securities Systems 7
2.23 Other Transfers 8
2.24 Establishment of Segregated Account 9
2.25 Custodian's Books and Records . 9
2.26 Opinion of Fund's Independent Certified Public
Accountants 9
2.27 Reports of Independent Certified Public Accountants 10
2.28 Overdraft Facility 10
III. PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS
AND RELATED MATTERS 10
3.01 Proper Instructions and Special Instructions 10
3.02 Authorized Persons 11
3.03 Persons Having Access to Assets of the Portfolios 11
3.04 Actions of the Custodian Based on Proper Instructions and
Special Instructions 11
i
IV. SUBCUSTODIANS 11
4.01 Domestic Subcustodians 12
4.02 Foreign Subcustodians and Interim Subcustodians 12
4.03 Special Subcustodians 13
4.04 Termination of a Subcustodian 13
4.05 Certification Regarding Foreign Subcustodians 13
V. STANDARD OF CARE; INDEMNIFICATION 14
5.01 Standard of Care 14
5.02 Liability of Custodian for Actions of Other Persons 15
5.03 Indemnification 15
5.04 Investment Limitations 16
5.05 Fund's Right to Proceed 16
VI. COMPENSATION 17
VII. TERMINATION 17
7.01 Termination of Agreement as to One or More Funds 17
7.02 Termination as to One or More Portfolios 18
VIII. DEFINED TERMS 18
IX. MISCELLANEOUS 19
9.01 Execution of Documents, Etc 19
9.02 Representative Capacity; Nonrecourse Obligations 19
9.03 Several Obligations of the Funds and the Portfolios 19
9.04 Representations and Warranties 19
9.05 Entire Agreement 20
9.06 Waivers and Amendments 20
9.07 Interpretation 20
9.08 Captions 20
9.09 Governing Law 20
9.10 Notices 21
IX. MISCELLANEOUS 21
9.11 Assignment 21
9.12 Counterparts 21
9.13 Confidentiality; Survival of Obligations 21
</TABLE>
ii
APPENDICES
Appendix "A" - List of Funds and Portfolios
Appendix "B" - List of Additional Custodians,
Special Subcustodians and Foreign Subcustodians
Appendix "C" - Procedures Relating to
Custodian's Security Interest
iii
EXHIBIT G(16)
FORM OF
CUSTODIAN AGREEMENT
AGREEMENT made as of the 1st day of September, 1994 between each of
the Investment Companies Listed on Appendix "A" hereto, as the same
may be amended from time to time (each a "Fund" and collectively the
"Funds") and Brown Brothers Harriman & Company (the "Custodian").
W I T N E S S E T H
WHEREAS, each Fund is or may be organized with one or more series of
shares, each of which shall represent an interest in a separate
portfolio of cash, securities and other assets (all such existing and
additional series now or hereafter listed on Appendix "A" being
hereinafter referred to individually, as a "Portfolio," and
collectively, as the "Portfolios"); and
WHEREAS, each Fund desires to appoint the Custodian as custodian on
behalf of each of its Portfolios in accordance with the provisions of
the Investment Company Act of 1940, as amended (the "1940 Act"), and
the rules and regulations thereunder, under the terms and conditions
set forth in this Agreement, and the Custodian has agreed so to act as
custodian.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
APPOINTMENT OF CUSTODIAN
On behalf of each of its Portfolios, each Fund hereby employs and
appoints the Custodian as a custodian, subject to the terms and
provisions of this Agreement. Each Fund shall deliver to the
Custodian, or shall cause to be delivered to the Custodian, cash,
securities and other assets owned by each of its Portfolios from time
to time during the term of this Agreement and shall specify to which
of its Portfolios such cash, securities and other assets are to be
specifically allocated.
ARTICLE II
POWERS AND DUTIES OF CUSTODIAN
As custodian, the Custodian shall have and perform the powers and
duties set forth in this Article II. Pursuant to and in accordance
with Article IV hereof, the Custodian may appoint one or more
Subcustodians (as hereinafter defined) to exercise the powers and
perform the duties of the Custodian set forth in this Article II and
references to the Custodian in this Article II shall include any
Subcustodian so appointed.
Section 2.01. Safekeeping. The Custodian shall keep safely all
cash, securities and other assets of each Fund's Portfolios delivered
to the Custodian and, on behalf of such Portfolios, the Custodian
shall, from time to time, accept delivery of cash, securities and
other assets for safekeeping.
Section 2.02. Manner of Holding Securities.
(a) The Custodian shall at all times hold securities of each Fund's
Portfolios either: (i) by physical possession of the share
certificates or other instruments representing such securities in
registered or bearer form; or (ii) in book-entry form by a Securities
System (as hereinafter defined) in accordance with the provisions of
Section 2.22 below.
(b) The Custodian shall at all times hold registered securities of
each Portfolio in the name of the Custodian, the Portfolio or a
nominee of either of them, unless specifically directed by Proper
Instructions to hold such registered securities in so-called street
name; provided that, in any event, all such securities and other
assets shall be held in an account of the Custodian containing only
assets of a Portfolio, or only assets held by the Custodian as a
fiduciary or custodian for customers; and provided further, that the
records of the Custodian shall indicate at all times the Portfolio or
other customer for which such securities and other assets are held in
such account and the respective interests therein.
Section 2.03. Security Purchases. Upon receipt of Proper
Instructions (as hereinafter defined), the Custodian shall pay for and
receive securities purchased for the account of a Portfolio, provided
that payment shall be made by the Custodian only upon receipt of the
securities: (a) by the Custodian; (b) by a clearing corporation of a
national securities exchange of which the Custodian is a member; or
(c) by a Securities System. Notwithstanding the foregoing, upon
receipt of Proper Instructions: (i) in the case of a repurchase
agreement, the Custodian may release funds to a Securities System
prior to the receipt of advice from the Securities System that the
securities underlying such repurchase agreement have been transferred
by book-entry into the Account (as hereinafter defined) maintained
with such Securities System by the Custodian, provided that the
Custodian's instructions to the Securities System require that the
Securities System may make payment of such funds to the other party to
the repurchase agreement only upon transfer by book-entry of the
securities underlying the repurchase agreement into the Account; (ii)
in the case of time deposits, call account deposits, currency
deposits, and other deposits, foreign exchange transactions, futures
contracts or options, pursuant to Sections 2.09, 2.10, 2.12 and 2.13
hereof, the Custodian may make payment therefor before receipt of an
advice or confirmation evidencing said deposit or entry into such
transaction; (iii) in the case of the purchase of securities, the
settlement of which occurs outside of the United States of America,
the Custodian may make payment therefor and receive delivery of such
securities in accordance with local custom and practice generally
accepted by Institutional Clients (as hereinafter defined) in the
country in which the settlement occurs, but in all events subject to
the standard of care set forth in Article V hereof; and (iv) in the
case of the purchase of securities in which, in accordance with
standard industry custom and practice generally accepted by
Institutional Clients with respect to such securities, the receipt of
such securities and the payment therefor take place in different
countries, the Custodian may receive delivery of such securities and
make payment therefor in accordance with standard industry custom and
practice for such securities generally accepted by Institutional
Clients, but in all events subject to the standard of care set forth
in Article V hereof. For purposes of this Agreement, an
"Institutional Client" shall mean a major commercial bank,
corporation, insurance company, or substantially similar institution,
which, as a substantial part of its business operations, purchases or
sells securities and makes use of custodial services.
Section 2.04. Exchanges of Securities. Upon receipt of Proper
Instructions, the Custodian shall exchange securities held by it for
the account of a Portfolio for other securities in connection with any
reorganization, recapitalization, split-up of shares, change of par
value, conversion or other event relating to the securities or the
issuer of such securities, and shall deposit any such securities in
accordance with the terms of any reorganization or protective plan.
The Custodian shall, without receiving Proper Instructions: surrender
securities in temporary form for definitive securities; surrender
securities for transfer into the name of the Custodian, a Portfolio or
a nominee of either of them, as permitted by Section 2.02(b); and
surrender securities for a different number of certificates or
instruments representing the same number of shares or same principal
amount of indebtedness, provided that the securities to be issued will
be delivered to the Custodian or a nominee of the Custodian.
Section 2.05. Sales of Securities. Upon receipt of Proper
Instructions, the Custodian shall make delivery of securities which
have been sold for the account of a Portfolio, but only against
payment therefor in the form of: (a) cash, certified check, bank
cashier's check, bank credit, or bank wire transfer; (b) credit to the
account of the Custodian with a clearing corporation of a national
securities exchange of which the Custodian is a member; or (c) credit
to the Account of the Custodian with a Securities System, in
accordance with the provisions of Section 2.22 hereof.
Notwithstanding the foregoing: (i) in the case of the sale of
securities, the settlement of which occurs outside of the United
States of America, such securities shall be delivered and paid for in
accordance with local custom and practice generally accepted by
Institutional Clients in the country in which the settlement occurs,
but in all events subject to the standard of care set forth in Article
V hereof; (ii) in the case of the sale of securities in which, in
accordance with standard industry custom and practice generally
accepted by Institutional Clients with respect to such securities, the
delivery of such securities and receipt of payment therefor take place
in different countries, the Custodian may deliver such securities and
receive payment therefor in accordance with standard industry custom
and practice for such securities generally accepted by Institutional
Clients, but in all events subject to the standard of care set forth
in Article V hereof; and (iii) in the case of securities held in
physical form, such securities shall be delivered and paid for in
accordance with "street delivery custom" to a broker or its clearing
agent, against delivery to the Custodian of a receipt for such
securities, provided that the Custodian shall have taken reasonable
steps to ensure prompt collection of the payment for, or the return
of, such securities by the broker or its clearing agent, and provided
further that the Custodian shall not be responsible for the selection
of or the failure or inability to perform of such broker or its
clearing agent.
Section 2.06. Depositary Receipts. Upon receipt of Proper
Instructions, the Custodian shall surrender securities to the
depositary used for such securities by an issuer of American
Depositary Receipts or International Depositary Receipts (hereinafter
referred to, collectively, as "ADRs"), against a written receipt
therefor adequately describing such securities and written evidence
satisfactory to the Custodian that the depositary has acknowledged
receipt of instructions to issue ADRs with respect to such securities
in the name of the Custodian or a nominee of the Custodian, for
delivery to the Custodian at such place as the Custodian may from time
to time designate. Upon receipt of Proper Instructions, the Custodian
shall surrender ADRs to the issuer thereof, against a written receipt
therefor adequately describing the ADRs surrendered and written
evidence satisfactory to the Custodian that the issuer of the ADRs has
acknowledged receipt of instructions to cause its depository to
deliver the securities underlying such ADRs to the Custodian.
Section 2.07. Exercise of Rights; Tender Offers. Upon receipt of
Proper Instructions, the Custodian shall: (a) deliver warrants, puts,
calls, rights or similar securities to the issuer or trustee thereof,
or to the agent of such issuer or trustee, for the purpose of exercise
or sale, provided that the new securities, cash or other assets, if
any, acquired as a result of such actions are to be delivered to the
Custodian; and (b) deposit securities upon invitations for tenders
thereof, provided that the consideration for such securities is to be
paid or delivered to the Custodian, or the tendered securities are to
be returned to the Custodian. Notwithstanding any provision of this
Agreement to the contrary, the Custodian shall take all necessary
action, unless otherwise directed to the contrary in Proper
Instructions, to comply with the terms of all mandatory or compulsory
exchanges, calls, tenders, redemptions, or similar rights of security
ownership, and shall promptly notify each applicable Fund of such
action in writing by facsimile transmission or in such other manner as
such Fund and the Custodian may agree in writing.
Section 2.08. Stock Dividends, Rights, Etc. The Custodian shall
receive and collect all stock dividends, rights and other items of
like nature and, upon receipt of Proper Instructions, take action with
respect to the same as directed in such Proper Instructions.
Section 2.09. Options. Upon receipt of Proper Instructions and in
accordance with the provisions of any agreement between the Custodian,
any registered broker-dealer and, if necessary, a Fund on behalf of
any applicable Portfolio relating to compliance with the rules of the
Options Clearing Corporation or of any registered national securities
exchange or similar organization(s), the Custodian shall: (a) receive
and retain confirmations or other documents, if any, evidencing the
purchase or writing of an option on a security or securities index by
the applicable Portfolio; (b) deposit and maintain in a segregated
account, securities (either physically or by book-entry in a
Securities System), cash or other assets; and (c) pay, release and/or
transfer such securities, cash or other assets in accordance with
notices or other communications evidencing the expiration, termination
or exercise of such options furnished by the Options Clearing
Corporation, the securities or options exchange on which such options
are traded, or such other organization as may be responsible for
handling such option transactions. Each Fund, on behalf of its
applicable Portfolios, and the broker-dealer shall be responsible for
the sufficiency of assets held in any segregated account established
in compliance with applicable margin maintenance requirements and the
performance of other terms of any option contract.
Section 2.10. Futures Contracts. Upon receipt of Proper
Instructions, or pursuant to the provisions of any futures margin
procedural agreement among a Fund, on behalf of any applicable
Portfolio, the Custodian and any futures commission merchant (a
"Procedural Agreement"), the Custodian shall: (a) receive and retain
confirmations, if any, evidencing the purchase or sale of a futures
contract or an option on a futures contract by the applicable
Portfolio; (b) deposit and maintain in a segregated account, cash,
securities and other assets designated as initial, maintenance or
variation "margin" deposits intended to secure the applicable
Portfolio's performance of its obligations under any futures contracts
purchased or sold or any options on futures contracts written by the
Portfolio, in accordance with the provisions of any Procedural
Agreement designed to comply with the rules of the Commodity Futures
Trading Commission and/or any commodity exchange or contract market
(such as the Chicago Board of Trade), or any similar organization(s),
regarding such margin deposits; and (c) release assets from and/or
transfer assets into such margin accounts only in accordance with any
such Procedural Agreements. Each Fund, on behalf of its applicable
Portfolios, and such futures commission merchant shall be responsible
for the sufficiency of assets held in the segregated account in
compliance with applicable margin maintenance requirements and the
performance of any futures contract or option on a futures contract in
accordance with its terms.
Section 2.11. Borrowing. Upon receipt of Proper Instructions, the
Custodian shall deliver securities of a Portfolio to lenders or their
agents, or otherwise establish a segregated account as agreed to by
the applicable Fund on behalf of such Portfolio and the Custodian, as
collateral for borrowings effected by such Portfolio, provided that
such borrowed money is payable by the lender (a) to or upon the
Custodian's order, as Custodian for such Portfolio, and (b)
concurrently with delivery of such securities.
Section 2.12. Interest Bearing Deposits.
Upon receipt of Proper Instructions directing the Custodian to
purchase interest bearing fixed term and call deposits (hereinafter
referred to collectively, as "Interest Bearing Deposits") for the
account of a Portfolio, the Custodian shall purchase such Interest
Bearing Deposits in the name of the Portfolio with such banks or trust
companies (including the Custodian, any Subcustodian or any subsidiary
or affiliate of the Custodian) (hereinafter referred to as "Banking
Institutions") and in such amounts as the applicable Fund may direct
pursuant to Proper Instructions. Such Interest Bearing Deposits may
be denominated in U.S. Dollars or other currencies, as the applicable
Fund on behalf of its Portfolio may determine and direct pursuant to
Proper Instructions. The Custodian shall include in its records with
respect to the assets of each Portfolio appropriate notation as to the
amount and currency of each such Interest Bearing Bank Deposit, the
accepting Banking Institution and all other appropriate details, and
shall retain such forms of advice or receipt evidencing such account,
if any, as may be forwarded to the Custodian by the Banking
Institution. The responsibilities of the Custodian to each Fund for
Interest Bearing Deposits accepted on the Custodian's books in the
United States on behalf of the Fund's Portfolios shall be that of a
U.S. bank for a similar deposit. With respect to Interest Bearing
Deposits other than those accepted on the Custodian's books, (a) the
Custodian shall be responsible for the collection of income as set
forth in Section 2.15 and the transmission of cash and instructions to
and from such accounts; and (b) the Custodian shall have no duty with
respect to the selection of the Banking Institution or, so long as the
Custodian acts in accordance with Proper Instructions, for the failure
of such Banking Institution to pay upon demand. Upon receipt of
Proper Instructions, the Custodian shall take such reasonable actions
as the applicable Fund deems necessary or appropriate to cause each
such Interest Bearing Deposit Account to be insured to the maximum
extent possible by all applicable deposit insurers including, without
limitation, the Federal Deposit Insurance Corporation.
Section 2.13. Foreign Exchange Transactions
(a) Foreign Exchange Transactions Other Than as Principal. Upon
receipt of Proper Instructions, the Custodian shall settle foreign
exchange contracts or options to purchase and sell foreign currencies
for spot and future delivery on behalf of and for the account of a
Portfolio with such currency brokers or Banking Institutions as the
applicable Fund may determine and direct pursuant to Proper
Instructions. The Custodian shall be responsible for the transmission
of cash and instructions to and from the currency broker or Banking
Institution with which the contract or option is made, the safekeeping
of all certificates and other documents and agreements evidencing or
relating to such foreign exchange transactions and the maintenance of
proper records as set forth in Section 2.25. The Custodian shall have
no duty with respect to the selection of the currency brokers or
Banking Institutions with which a Fund deals on behalf of its
Portfolios or, so long as the Custodian acts in accordance with Proper
Instructions, for the failure of such brokers or Banking Institutions
to comply with the terms of any contract or option.
(b) Foreign Exchange Contracts as Principal. The Custodian shall
not be obligated to enter into foreign exchange transactions as
principal. However, if the Custodian has made available to a Fund its
services as a principal in foreign exchange transactions, upon receipt
of Proper Instructions, the Custodian shall enter into foreign
exchange contracts or options to purchase and sell foreign currencies
for spot and future delivery on behalf of and for the account of a
Portfolio of such Fund with the Custodian as principal. The Custodian
shall be responsible for the selection of the currency brokers or
Banking Institutions and the failure of such currency brokers or
Banking Institutions to comply with the terms of any contract or
option.
(c) Payments. Notwithstanding anything to the contrary contained
herein, upon receipt of Proper Instructions the Custodian may, in
connection with a foreign exchange contract, make free outgoing
payments of cash in the form of U.S. Dollars or foreign currency prior
to receipt of confirmation of such foreign exchange contract or
confirmation that the countervalue currency completing such contract
has been delivered or received.
Section 2.14. Securities Loans. Upon receipt of Proper
Instructions, the Custodian shall, in connection with loans of
securities by a Portfolio, deliver securities of such Portfolio to the
borrower thereof prior to receipt of the collateral, if any, for such
borrowing; provided that, in cases of loans of securities secured by
cash collateral, the Custodian's instructions to the Securities System
shall require that the Securities System deliver the securities of the
Portfolio to the borrower thereof only upon receipt of the collateral
for such borrowing.
Section 2.15. Collections. The Custodian shall, and shall cause any
Subcustodian to: (a) collect amounts due and payable to each Fund
with respect to portfolio securities and other assets of each of such
Fund's Portfolios; (b) promptly credit to the account of each
applicable Portfolio all income and other payments relating to
portfolio securities and other assets held by the Custodian hereunder
upon Custodian's receipt of such income or payments or as otherwise
agreed in writing by the Custodian and the applicable Fund; (c)
promptly endorse and deliver any instruments required to effect such
collections; (d) promptly execute ownership and other certificates and
affidavits for all federal, state and foreign tax purposes in
connection with receipt of income, capital gains or other payments
with respect to portfolio securities and other assets of each
applicable Portfolio, or in connection with the purchase, sale or
transfer of such securities or other assets; and (e) promptly file any
certificates or other affidavits for the refund or reclaim of foreign
taxes paid, and promptly notify each applicable Fund of any changes to
law, interpretative rulings or procedures regarding such reclaims, and
otherwise use all available measures customarily used to minimize the
imposition of foreign taxes at source, and promptly inform each
applicable Fund of alternative means of minimizing such taxes of which
the Custodian shall become aware (or with the exercise of reasonable
care should have become aware); provided, however, that with respect
to portfolio securities registered in so-called street name, the
Custodian shall use its best efforts to collect amounts due and
payable to each Fund with respect to its Portfolios. The Custodian
shall promptly notify each applicable Fund in writing by facsimile
transmission or in such other manner as each such Fund and the
Custodian may agree in writing if any amount payable with respect to
portfolio securities or other assets of the Portfolios of such Fund(s)
is not received by the Custodian when due. The Custodian shall not be
responsible for the collection of amounts due and payable with respect
to portfolio securities or other assets that are in default.
Section 2.16. Dividends, Distributions and Redemptions. The
Custodian shall promptly release funds or securities: (a) upon
receipt of Proper Instructions, to one or more Distribution Accounts
designated by the applicable Fund or Funds in such Proper
Instructions; or (b) upon receipt of Special Instructions, as
otherwise directed by the applicable Fund or Funds, for the purpose of
the payment of dividends or other distributions to shareholders of
each applicable Portfolio, and payment to shareholders who have
requested repurchase or redemption of their shares of the Portfolio(s)
(collectively, the "Shares"). For purposes of this Agreement, a
"Distribution Account" shall mean an account established at a Banking
Institution designated by the applicable Fund on behalf of one or more
of its Portfolios in Special Instructions.
Section 2.17. Proceeds from Shares Sold. The Custodian shall
receive funds representing cash payments received for Shares issued or
sold from time to time by the Funds, and shall promptly credit such
funds to the account(s) of the applicable Portfolio(s). The Custodian
shall promptly notify each applicable Fund of Custodian's receipt of
cash in payment for Shares issued by such Fund by facsimile
transmission or in such other manner as the Fund and Custodian may
agree in writing. Upon receipt of Proper Instructions, the Custodian
shall: (a) deliver all federal funds received by the Custodian in
payment for Shares in payment for such investments as may be set forth
in such Proper Instructions and at a time agreed upon between the
Custodian and the applicable Fund; and (b) make federal funds
available to the applicable Fund as of specified times agreed upon
from time to time by the applicable Fund and the Custodian, in the
amount of checks received in payment for Shares which are deposited to
the accounts of each applicable Portfolio.
Section 2.18. Proxies, Notices, Etc. The Custodian shall deliver to
each applicable Fund, in the most expeditious manner practicable, all
forms of proxies, all notices of meetings, and any other notices or
announcements affecting or relating to securities owned by one or more
of the applicable Fund's Portfolios that are received by the
Custodian, any Subcustodian, or any nominee of either of them, and,
upon receipt of Proper Instructions, the Custodian shall execute and
deliver, or cause such Subcustodian or nominee to execute and deliver,
such proxies or other authorizations as may be required. Except as
directed pursuant to Proper Instructions, neither the Custodian nor
any Subcustodian or nominee shall vote upon any such securities, or
execute any proxy to vote thereon, or give any consent or take any
other action with respect thereto.
Section 2.19. Bills and Other Disbursements. Upon receipt of Proper
Instructions, the Custodian shall pay or cause to be paid, all bills,
statements, or other obligations of each Portfolio.
Section 2.20. Nondiscretionary Functions. The Custodian shall
attend to all nondiscretionary details in connection with the sale,
exchange, substitution, purchase, transfer or other dealings with
securities or other assets of each Portfolio held by the Custodian,
except as otherwise directed from time to time pursuant to Proper
Instructions.
Section 2.21. Bank Accounts
(a) Accounts with the Custodian and any Subcustodians. The Custodian
shall open and operate a bank account or accounts (hereinafter
referred to collectively, as "Bank Accounts") on the books of the
Custodian or any Subcustodian provided that such account(s) shall be
in the name of the Custodian or a nominee of the Custodian, for the
account of a Portfolio, and shall be subject only to the draft or
order of the Custodian; provided however, that such Bank Accounts in
countries other than the United States may be held in an account of
the Custodian containing only assets held by the Custodian as a
fiduciary or custodian for customers, and provided further, that the
records of the Custodian shall indicate at all times the Portfolio or
other customer for which such securities and other assets are held in
such account and the respective interests therein. Such Bank Accounts
may be denominated in either U.S. Dollars or other currencies. The
responsibilities of the Custodian to each applicable Fund for deposits
accepted on the Custodian's books in the United States shall be that
of a U.S. bank for a similar deposit. The responsibilities of the
Custodian to each applicable Fund for deposits accepted on any
Subcustodian's books shall be governed by the provisions of Section
5.02.
(b) Accounts With Other Banking Institutions. The Custodian may open
and operate Bank Accounts on behalf of a Portfolio, in the name of the
Custodian or a nominee of the Custodian, at a Banking Institution
other than the Custodian or any Subcustodian, provided that such
account(s) shall be in the name of the Custodian or a nominee of the
Custodian, for the account of a Portfolio, and shall be subject only
to the draft or order of the Custodian; provided however, that such
Bank Accounts may be held in an account of the Custodian containing
only assets held by the Custodian as a fiduciary or custodian for
customers, and provided further, that the records of the Custodian
shall indicate at all times the Portfolio or other customer for which
such securities and other assets are held in such account and the
respective interests therein. Such Bank Accounts may be denominated
in either U.S. Dollars or other currencies. Subject to the provisions
of Section 5.01(a), the Custodian shall be responsible for the
selection of the Banking Institution and for the failure of such
Banking Institution to pay according to the terms of the deposit.
(c) Deposit Insurance. Upon receipt of Proper Instructions, the
Custodian shall take such reasonable actions as the applicable Fund
deems necessary or appropriate to cause each deposit account
established by the Custodian pursuant to this Section 2.21 to be
insured to the maximum extent possible by all applicable deposit
insurers including, without limitation, the Federal Deposit Insurance
Corporation.
Section 2.22. Deposit of Fund Assets in Securities Systems. The
Custodian may deposit and/or maintain domestic securities owned by a
Portfolio in: (a) The Depository Trust Company; (b) the Participants
Trust Company; (c) any book-entry system as provided in (i) Subpart O
of Treasury Circular No. 300, 31 CFR 306.115, (ii) Subpart B of
Treasury Circular Public Debt Series No. 27-76, 31 CFR 350.2, or (iii)
the book-entry regulations of federal agencies substantially in the
form of 31 CFR 306.115; or (d) any other domestic clearing agency
registered with the Securities and Exchange Commission ("SEC") under
Section 17A of the Securities Exchange Act of 1934 (or as may
otherwise be authorized by the Securities and Exchange Commission to
serve in the capacity of depository or clearing agent for the
securities or other assets of investment companies) which acts as a
securities depository and the use of which each applicable Fund has
previously approved by Special Instructions (as hereinafter defined)
(each of the foregoing being referred to in this Agreement as a
"Securities System"). Use of a Securities System shall be in
accordance with applicable Federal Reserve Board and SEC rules and
regulations, if any, and subject to the following provisions:
(A) The Custodian may deposit and/or maintain securities held
hereunder in a Securities System, provided that such securities are
represented in an account ("Account") of the Custodian in the
Securities System which Account shall not contain any assets of the
Custodian other than assets held as a fiduciary, custodian, or
otherwise for customers and shall be so designated on the books and
records of the Securities System.
(B) The Securities System shall be obligated to comply with the
Custodian's directions with respect to the securities held in such
Account and shall not be entitled to a lien against the assets in such
Account for extensions of credit to the Custodian other than for
payment of the purchase price of such assets.
(C) Each Fund hereby designates the Custodian as the party in whose
name any securities deposited by the Custodian in the Account are to
be registered.
(D) The books and records of the Custodian shall at all times
identify those securities belonging to each Portfolio which are
maintained in a Securities System.
(E) The Custodian shall pay for securities purchased for the account
of a Portfolio only upon (w) receipt of advice from the Securities
System that such securities have been transferred to the Account of
the Custodian, and (x) the making of an entry on the records of the
Custodian to reflect such payment and transfer for the account of such
Portfolio. The Custodian shall transfer securities sold for the
account of a Portfolio only upon (y) receipt of advice from the
Securities System that payment for such securities has been
transferred to the Account of the Custodian, and (z) the making of an
entry on the records of the Custodian to reflect such transfer and
payment for the account of such Portfolio. Copies of all advices from
the Securities System relating to transfers of securities for the
account of a Portfolio shall identify such Portfolio and shall be
maintained for such Portfolio by the Custodian. The Custodian shall
deliver to each applicable Fund on the next succeeding business day
daily transaction reports which shall include each day's transactions
in the Securities System for the account of each applicable Portfolio.
Such transaction reports shall be delivered to each applicable Fund or
any agent designated by such Fund pursuant to Proper Instructions, by
computer or in such other manner as such Fund and the Custodian may
agree in writing.
(F) The Custodian shall, if requested by a Fund pursuant to Proper
Instructions, provide such Fund with all reports obtained by the
Custodian or any Subcustodian with respect to a Securities System's
accounting system, internal accounting control and procedures for
safeguarding securities deposited in the Securities System.
(G) Upon receipt of Special Instructions, the Custodian shall
terminate the use of any Securities System (except the federal
book-entry system) on behalf of any Portfolio as promptly as
practicable and shall take all actions reasonably practicable to
safeguard the securities of any Portfolio maintained with such
Securities System.
Section 2.23. Other Transfers.
(a) Upon receipt of Proper Instructions, the Custodian shall transfer
to or receive from a third party that has been appointed to serve as
an additional custodian of one or more Portfolios (an "Additional
Custodian") securities, cash and other assets of such Portfolio(s) in
accordance with such Proper Instructions. Each Additional Custodian
shall be identified as such on Appendix B, as the same may be amended
from time to time in accordance with the provisions of Section
9.06(c).
(b) Upon receipt of Special Instructions, the Custodian shall make
such other dispositions of securities, funds or other property of a
Portfolio in a manner or for purposes other than as expressly set
forth in this Agreement, provided that the Special Instructions
relating to such disposition shall include a statement of the purpose
for which the delivery is to be made, the amount of funds and/or
securities to be delivered, and the name of the person or persons to
whom delivery is to be made, and shall otherwise comply with the
provisions of Sections 3.01 and 3.03 hereof.
Section 2.24. Establishment of Segregated Account. Upon receipt of
Proper Instructions, the Custodian shall establish and maintain on its
books a segregated account or accounts for and on behalf of a
Portfolio, into which account or accounts may be transferred cash
and/or securities or other assets of such Portfolio, including
securities maintained by the Custodian in a Securities System pursuant
to Section 2.22 hereof, said account or accounts to be maintained:
(a) for the purposes set forth in Sections 2.09, 2.10 and 2.11 hereof;
(b) for the purposes of compliance by the Portfolio with the
procedures required by Investment Company Act Release No. 10666, or
any subsequent release or releases of the SEC relating to the
maintenance of segregated accounts by registered investment companies;
or (c) for such other purposes as set forth, from time to time, in
Special Instructions.
Section 2.25. Custodian's Books and Records. The Custodian shall
provide any assistance reasonably requested by a Fund in the
preparation of reports to such Fund's shareholders and others, audits
of accounts, and other ministerial matters of like nature. The
Custodian shall maintain complete and accurate records with respect to
securities and other assets held for the accounts of each Portfolio as
required by the rules and regulations of the SEC applicable to
investment companies registered under the 1940 Act, including: (a)
journals or other records of original entry containing a detailed and
itemized daily record of all receipts and deliveries of securities
(including certificate and transaction identification numbers, if
any), and all receipts and disbursements of cash; (b) ledgers or other
records reflecting (i) securities in transfer, (ii) securities in
physical possession, (iii) securities borrowed, loaned or
collateralizing obligations of each Portfolio, (iv) monies borrowed
and monies loaned (together with a record of the collateral therefor
and substitutions of such collateral), (v) dividends and interest
received, (vi) the amount of tax withheld by any person in respect of
any collection made by the Custodian or any Subcustodian, and (vii)
the amount of reclaims or refunds for foreign taxes paid; and (c)
cancelled checks and bank records related thereto. The Custodian
shall keep such other books and records of each Fund as such Fund
shall reasonably request. All such books and records maintained by
the Custodian shall be maintained in a form acceptable to the
applicable Fund and in compliance with the rules and regulations of
the SEC, including, but not limited to, books and records required to
be maintained by Section 31(a) of the 1940 Act and the rules and
regulations from time to time adopted thereunder. All books and
records maintained by the Custodian pursuant to this Agreement shall
at all times be the property of each applicable Fund and shall be
available during normal business hours for inspection and use by such
Fund and its agents, including, without limitation, its independent
certified public accountants. Notwithstanding the preceding sentence,
no Fund shall take any actions or cause the Custodian to take any
actions which would cause, either directly or indirectly, the
Custodian to violate any applicable laws, regulations or orders.
Section 2.26. Opinion of Fund's Independent Certified Public
Accountants. The Custodian shall take all reasonable action as a Fund
may request to obtain from year to year favorable opinions from such
Fund's independent certified public accountants with respect to the
Custodian's activities hereunder in connection with the preparation of
the Fund's Form N-1A and the Fund's Form N-SAR or other periodic
reports to the SEC and with respect to any other requirements of the
SEC.
Section 2.27. Reports by Independent Certified Public Accountants.
At the request of a Fund, the Custodian shall deliver to such Fund a
written report prepared by the Custodian's independent certified
public accountants with respect to the services provided by the
Custodian under this Agreement, including, without limitation, the
Custodian's accounting system, internal accounting control and
procedures for safeguarding cash, securities and other assets,
including cash, securities and other assets deposited and/or
maintained in a Securities System or with a Subcustodian. Such report
shall be of sufficient scope and in sufficient detail as may
reasonably be required by any Fund and as may reasonably be obtained
by the Custodian.
Section 2.28. Overdraft Facility. In the event that the Custodian
is directed by Proper Instructions to make any payment or transfer of
funds on behalf of a Portfolio for which there would be, at the close
of business on the date of such payment or transfer, insufficient
funds held by the Custodian on behalf of such Portfolio, the Custodian
may, in its discretion, provide an overdraft (an "Overdraft") to the
applicable Fund on behalf of such Portfolio, in an amount sufficient
to allow the completion of such payment. Any Overdraft provided
hereunder: (a) shall be payable on the next Business Day, unless
otherwise agreed by the applicable Fund and the Custodian; and (b)
shall accrue interest from the date of the Overdraft to the date of
payment in full by the applicable Fund on behalf of the applicable
Portfolio at a rate agreed upon in writing, from time to time, by the
Custodian and the applicable Fund. The Custodian and each Fund
acknowledge that the purpose of such Overdrafts is to temporarily
finance the purchase or sale of securities for prompt delivery in
accordance with the terms hereof, or to meet emergency expenses not
reasonably foreseeable by such Fund. The Custodian shall promptly
notify each applicable Fund in writing (an "Overdraft Notice") of any
Overdraft by facsimile transmission or in such other manner as such
Fund and the Custodian may agree in writing. At the request of the
Custodian, each applicable Fund, on behalf of one or more of its
Portfolios, shall pledge, assign and grant to the Custodian a security
interest in certain specified securities of the applicable Portfolio,
as security for Overdrafts provided to such Portfolio, under the terms
and conditions set forth in Appendix "C" attached hereto.
ARTICLE III
PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS
AND RELATED MATTERS
Section 3.01. Proper Instructions and Special Instructions.
(a) Proper Instructions. As used herein, the term "Proper
Instructions" shall mean: (i) a tested telex, a written (including,
without limitation, facsimile transmission) request, direction,
instruction or certification signed or initialed by or on behalf of
the applicable Fund by one or more Authorized Persons (as hereinafter
defined); (ii) a telephonic or other oral communication by one or more
Authorized Persons; or (iii) a communication effected directly between
an electro-mechanical or electronic device or system (including,
without limitation, computers) by or on behalf of the applicable Fund
by one or more Authorized Persons; provided, however, that
communications of the types described in clauses (ii) and (iii) above
purporting to be given by an Authorized Person shall be considered
Proper Instructions only if the Custodian reasonably believes such
communications to have been given by an Authorized Person with respect
to the transaction involved. Proper Instructions in the form of oral
communications shall be confirmed by the applicable Fund by tested
telex or in writing in the manner set forth in clause (i) above, but
the lack of such confirmation shall in no way affect any action taken
by the Custodian in reliance upon such oral instructions prior to the
Custodian's receipt of such confirmation. Each Fund and the Custodian
are hereby authorized to record any and all telephonic or other oral
instructions communicated to the Custodian. Proper Instructions may
relate to specific transactions or to types or classes of
transactions, and may be in the form of standing instructions.
(b) Special Instructions. As used herein, the term "Special
Instructions" shall mean Proper Instructions countersigned or
confirmed in writing by the Treasurer or any Assistant Treasurer of
the applicable Fund or any other person designated by the Treasurer of
such Fund in writing, which countersignature or confirmation shall be
(i) included on the same instrument containing the Proper Instructions
or on a separate instrument relating thereto, and (ii) delivered by
hand, by facsimile transmission, or in such other manner as the
applicable Fund and the Custodian agree in writing.
(c) Address for Proper Instructions and Special Instructions. Proper
Instructions and Special Instructions shall be delivered to the
Custodian at the address and/or telephone, telecopy or telex number
agreed upon from time to time by the Custodian and the applicable
Fund.
Section 3.02. Authorized Persons. Concurrently with the execution
of this Agreement and from time to time thereafter, as appropriate,
each Fund shall deliver to the Custodian, duly certified as
appropriate by a Treasurer or Assistant Treasurer of such Fund, a
certificate setting forth: (a) the names, titles, signatures and
scope of authority of all persons authorized to give Proper
Instructions or any other notice, request, direction, instruction,
certificate or instrument on behalf of such Fund (collectively, the
"Authorized Persons" and individually, an "Authorized Person"); and
(b) the names, titles and signatures of those persons authorized to
issue Special Instructions. Such certificate may be accepted and
relied upon by the Custodian as conclusive evidence of the facts set
forth therein and shall be considered to be in full force and effect
until delivery to the Custodian of a similar certificate to the
contrary. Upon delivery of a certificate which deletes the name(s) of
a person previously authorized by a Fund to give Proper Instructions
or to issue Special Instructions, such persons shall no longer be
considered an Authorized Person or authorized to issue Special
Instructions for that Fund.
Section 3.03. Persons Having Access to Assets of the Portfolios.
Notwithstanding anything to the contrary contained in this Agreement,
no Authorized Person, Trustee, officer, employee or agent of any Fund
shall have physical access to the assets of any Portfolio of that Fund
held by the Custodian nor shall the Custodian deliver any assets of a
Portfolio for delivery to an account of such person; provided,
however, that nothing in this Section 3.03 shall prohibit (a) any
Authorized Person from giving Proper Instructions, or any person
authorized to issue Special Instructions from issuing Special
Instructions, so long as such action does not result in delivery of or
access to assets of any Portfolio prohibited by this Section 3.03; or
(b) each Fund's independent certified public accountants from
examining or reviewing the assets of the Portfolios of the Fund held
by the Custodian. Each Fund shall deliver to the Custodian a written
certificate identifying such Authorized Persons, Trustees, officers,
employees and agents of such Fund.
Section 3.04. Actions of Custodian Based on Proper Instructions and
Special Instructions. So long as and to the extent that the Custodian
acts in accordance with (a) Proper Instructions or Special
Instructions, as the case may be, and (b) the terms of this Agreement,
the Custodian shall not be responsible for the title, validity or
genuineness of any property, or evidence of title thereof, received by
it or delivered by it pursuant to this Agreement.
ARTICLE IV
SUBCUSTODIANS
The Custodian may, from time to time, in accordance with the relevant
provisions of this Article IV, appoint one or more Domestic
Subcustodians, Foreign Subcustodians, Interim Subcustodians and
Special Subcustodians to act on behalf of a Portfolio. (For purposes
of this Agreement, all duly appointed Domestic Subcustodians, Foreign
Subcustodians, Interim Subcustodians, and Special Subcustodians are
hereinafter referred to collectively, as "Subcustodians.")
Section 4.01. Domestic Subcustodians. The Custodian may, at any
time and from time to time, appoint any bank as defined in Section
2(a)(5) of the 1940 Act meeting the requirements of a custodian under
Section 17(f) of the 1940 Act and the rules and regulations
thereunder, to act on behalf of one or more Portfolios as a
subcustodian for purposes of holding cash, securities and other assets
of such Portfolios and performing other functions of the Custodian
within the United States (a "Domestic Subcustodian"); provided, that,
the Custodian shall notify each applicable Fund in writing of the
identity and qualifications of any proposed Domestic Subcustodian at
least thirty (30) days prior to appointment of such Domestic
Subcustodian, and such Fund may, in its sole discretion, by written
notice to the Custodian executed by an Authorized Person disapprove of
the appointment of such Domestic Subcustodian. If, following notice
by the Custodian to each applicable Fund regarding appointment of a
Domestic Subcustodian and the expiration of thirty (30) days after the
date of such notice, such Fund shall have failed to notify the
Custodian of its disapproval thereof, the Custodian may, in its
discretion, appoint such proposed Domestic Subcustodian as its
subcustodian.
Section 4.02. Foreign Subcustodians and Interim Subcustodians.
(a) Foreign Subcustodians. The Custodian may, at any time and from
time to time, appoint: (i) any bank, trust company or other entity
meeting the requirements of an "eligible foreign custodian" under
Section 17(f) of the 1940 Act and the rules and regulations thereunder
or by order of the Securities and Exchange Commission exempted
therefrom, or (ii) any bank as defined in Section 2(a)(5) of the 1940
Act meeting the requirements of a custodian under Section 17(f) of the
1940 Act and the rules and regulations thereunder to act on behalf of
one or more Portfolios as a subcustodian for purposes of holding cash,
securities and other assets of such Portfolios and performing other
functions of the Custodian in countries other than the United States
of America (a "Foreign Subcustodian"); provided, that, prior to the
appointment of any Foreign Subcustodian, the Custodian shall have
obtained written confirmation of the approval of the Board of Trustees
or other governing body or entity of each applicable Fund on behalf of
its applicable Portfolio(s) (which approval may be withheld in the
sole discretion of such Board of Trustees or other governing body or
entity) with respect to (i) the identity and qualifications of any
proposed Foreign Subcustodian, (ii) the country or countries in which,
and the securities depositories or clearing agencies, if any, through
which, any proposed Foreign Subcustodian is authorized to hold
securities and other assets of the applicable Portfolio(s), and (iii)
the form and terms of the subcustodian agreement to be entered into
between such proposed Foreign Subcustodian and the Custodian. Each
such duly approved Foreign Subcustodian and the countries where and
the securities depositories and clearing agencies through which they
may hold securities and other assets of the applicable Portfolios
shall be listed on Appendix "B" attached hereto, as it may be amended,
from time to time, in accordance with the provisions of Section
9.05(c) hereof. Each Fund shall be responsible for informing the
Custodian sufficiently in advance of a proposed investment by one of
its Portfolios which is to be held in a country in which no Foreign
Subcustodian is authorized to act, in order that there shall be
sufficient time for the Custodian to effect the appropriate
arrangements with a proposed foreign subcustodian, including obtaining
approval as provided in this Section 4.02(a). The Custodian shall not
amend any subcustodian agreement entered into with a Foreign
Subcustodian, or agree to change or permit any changes thereunder, or
waive any rights under such agreement, which materially affect a
Fund's rights or the Foreign Subcustodian's obligations or duties to
a Fund under such agreement, except upon prior approval pursuant to
Special Instructions.
(b) Interim Subcustodians. Notwithstanding the foregoing, in the
event that a Portfolio shall invest in a security or other asset to be
held in a country in which no Foreign Subcustodian is authorized to
act, the Custodian shall promptly notify the applicable Fund in
writing by facsimile transmission or in such other manner as such Fund
and Custodian shall agree in writing of the unavailability of an
approved Foreign Subcustodian in such country; and the Custodian
shall, upon receipt of Special Instructions, appoint any Person
designated by the applicable Fund in such Special Instructions to hold
such security or other asset. (Any Person appointed as a subcustodian
pursuant to this Section 4.02(b) is hereinafter referred to as an
"Interim Subcustodian.")
Section 4.03. Special Subcustodians. Upon receipt of Special
Instructions, the Custodian shall, on behalf of one or more
Portfolios, appoint one or more banks, trust companies or other
entities designated in such Special Instructions to act as a
subcustodian for purposes of: (i) effecting third-party repurchase
transactions with banks, brokers, dealers or other entities through
the use of a common custodian or subcustodian; (ii) establishing a
joint trading account for the applicable Portfolio(s) and other
registered open-end management investment companies for which Fidelity
Management & Research Company serves as investment adviser, through
which such Portfolios and such other investment companies shall
collectively participate in certain repurchase transactions; (iii)
providing depository and clearing agency services with respect to
certain variable rate demand note securities; and (iv) effecting any
other transactions designated by each applicable Fund in Special
Instructions. (Each such designated subcustodian is hereinafter
referred to as a "Special Subcustodian.") Each such duly appointed
Special Subcustodian shall be listed on Appendix "B" attached hereto,
as it may be amended from time to time in accordance with the
provisions of Section 9.05(c) hereof. In connection with the
appointment of any Special Subcustodian, the Custodian shall enter
into a subcustodian agreement with the Special Subcustodian in form
and substance approved by each applicable Fund, provided that such
agreement shall in all events comply with the provisions of the 1940
Act and the rules and regulations thereunder and the terms and
provisions of this Agreement. The Custodian shall not amend any
subcustodian agreement entered into with a Special Subcustodian, or
agree to change or permit any changes thereunder, or waive any rights
under such agreement, except upon prior approval pursuant to Special
Instructions.
Section 4.04. Termination of a Subcustodian. The Custodian shall
(i) cause each Domestic Subcustodian and Foreign Subcustodian to, and
(ii) use its best efforts to cause each Interim Subcustodian and
Special Subcustodian to, perform all of its obligations in accordance
with the terms and conditions of the subcustodian agreement between
the Custodian and such Subcustodian. In the event that the Custodian
is unable to cause such Subcustodian to fully perform its obligations
thereunder, the Custodian shall forthwith, upon the receipt of Special
Instructions, terminate such Subcustodian with respect to each
applicable Fund and, if necessary or desirable, appoint a replacement
Subcustodian in accordance with the provisions of Section 4.01 or
Section 4.02, as the case may be. In addition to the foregoing, the
Custodian (A) may, at any time in its discretion, upon written
notification to each applicable Fund, terminate any Domestic
Subcustodian, Foreign Subcustodian or Interim Subcustodian, and (B)
shall, upon receipt of Special Instructions, terminate any
Subcustodian with respect to each applicable Fund, in accordance with
the termination provisions under the applicable subcustodian
agreement.
Section 4.05. Certification Regarding Foreign Subcustodians. Upon
request of a Fund, the Custodian shall deliver to such Fund a
certificate stating: (i) the identity of each Foreign Subcustodian
then acting on behalf of the Custodian for such Fund and its
Portfolios; (ii) the countries in which and the securities
depositories and clearing agents through which each such Foreign
Subcustodian is then holding cash, securities and other assets of any
Portfolio of such Fund; and (iii) such other information as may be
requested by such Fund to ensure compliance with Rule 17(f)-5 under
the 1940 Act.
ARTICLE V
STANDARD OF CARE; INDEMNIFICATION
Section 5.01. Standard of Care.
(a) General Standard of Care. The Custodian shall exercise
reasonable care and diligence in carrying out all of its duties and
obligations under this Agreement, and shall be liable to each Fund for
all loss, damage and expense suffered or incurred by such Fund or its
Portfolios resulting from the failure of the Custodian to exercise
such reasonable care and diligence.
(b) Actions Prohibited by Applicable Law, Etc. In no event shall the
Custodian incur liability hereunder if the Custodian or any
Subcustodian or Securities System, or any subcustodian, securities
depository or securities system utilized by any such Subcustodian, or
any nominee of the Custodian or any Subcustodian (individually, a
"Person") is prevented, forbidden or delayed from performing, or omits
to perform, any act or thing which this Agreement provides shall be
performed or omitted to be performed, by reason of: (i) any provision
of any present or future law or regulation or order of the United
States of America, or any state thereof, or of any foreign country, or
political subdivision thereof or of any court of competent
jurisdiction; or (ii) any act of God or war or other similar
circumstance beyond the control of the Custodian, unless, in each
case, such delay or nonperformance is caused by (A) the negligence,
misfeasance or misconduct of the applicable Person, or (B) a
malfunction or failure of equipment operated or utilized by the
applicable Person other than a malfunction or failure beyond such
Person's control and which could not reasonably be anticipated and/or
prevented by such Person.
(c) Mitigation by Custodian. Upon the occurrence of any event which
causes or may cause any loss, damage or expense to any Fund or
Portfolio, (i) the Custodian shall, (ii) the Custodian shall cause any
applicable Domestic Subcustodian or Foreign Subcustodian to, and (iii)
the Custodian shall use its best efforts to cause any applicable
Interim Subcustodian or Special Subcustodian to, use all commercially
reasonable efforts and take all reasonable steps under the
circumstances to mitigate the effects of such event and to avoid
continuing harm to the Funds and the Portfolios.
(d) Advice of Counsel. The Custodian shall be entitled to receive
and act upon advice of counsel on all matters. The Custodian shall be
without liability for any action reasonably taken or omitted in good
faith pursuant to the advice of (i) counsel for the applicable Fund or
Funds, or (ii) at the expense of the Custodian, such other counsel as
the applicable Fund(s) and the Custodian may agree upon; provided,
however, with respect to the performance of any action or omission of
any action upon such advice, the Custodian shall be required to
conform to the standard of care set forth in Section 5.01(a).
(e) Expenses of the Funds. In addition to the liability of the
Custodian under this Article V, the Custodian shall be liable to each
applicable Fund for all reasonable costs and expenses incurred by such
Fund in connection with any claim by such Fund against the Custodian
arising from the obligations of the Custodian hereunder, including,
without limitation, all reasonable attorneys' fees and expenses
incurred by such Fund in asserting any such claim, and all expenses
incurred by such Fund in connection with any investigations, lawsuits
or proceedings relating to such claim; provided, that such Fund has
recovered from the Custodian for such claim.
(f) Liability for Past Records. The Custodian shall have no
liability in respect of any loss, damage or expense suffered by a
Fund, insofar as such loss, damage or expense arises from the
performance of the Custodian's duties hereunder by reason of the
Custodian's reliance upon records that were maintained for such Fund
by entities other than the Custodian prior to the Custodian's
appointment as custodian for such Fund.
Section 5.02. Liability of Custodian for Actions of Other Persons.
(a) Domestic Subcustodians and Foreign Subcustodians. The Custodian
shall be liable for the actions or omissions of any Domestic
Subcustodian or any Foreign Subcustodian to the same extent as if such
action or omission were performed by the Custodian itself. In the
event of any loss, damage or expense suffered or incurred by a Fund
caused by or resulting from the actions or omissions of any Domestic
Subcustodian or Foreign Subcustodian for which the Custodian would
otherwise be liable, the Custodian shall promptly reimburse such Fund
in the amount of any such loss, damage or expense.
(b) Interim Subcustodians. Notwithstanding the provisions of Section
5.01 to the contrary, the Custodian shall not be liable to a Fund for
any loss, damage or expense suffered or incurred by such Fund or any
of its Portfolios resulting from the actions or omissions of an
Interim Subcustodian unless such loss, damage or expense is caused by,
or results from, the negligence, misfeasance or misconduct of the
Custodian; provided, however, in the event of any such loss, damage or
expense, the Custodian shall take all reasonable steps to enforce such
rights as it may have against such Interim Subcustodian to protect the
interests of the Funds and the Portfolios.
(c) Special Subcustodians and Additional Custodians. Notwithstanding
the provisions of Section 5.01 to the contrary and except as otherwise
provided in any subcustodian agreement to which the Custodian, a Fund
and any Special Subcustodian or Additional Custodian are parties, the
Custodian shall not be liable to a Fund for any loss, damage or
expense suffered or incurred by such Fund or any of its Portfolios
resulting from the actions or omissions of a Special Subcustodian or
Additional Subcustodian, unless such loss, damage or expense is caused
by, or results from, the negligence, misfeasance or misconduct of the
Custodian; provided, however, that in the event of any such loss,
damage or expense, the Custodian shall take all reasonable steps to
enforce such rights as it may have against any Special Subcustodian or
Additional Custodian to protect the interests of the Funds and the
Portfolios.
(d) Securities Systems. Notwithstanding the provisions of Section
5.01 to the contrary, the Custodian shall not be liable to a Fund for
any loss, damage or expense suffered or incurred by such Fund or any
of its Portfolios resulting from the use by the Custodian of a
Securities System, unless such loss, damage or expense is caused by,
or results from, the negligence, misfeasance or misconduct of the
Custodian; provided, however, that in the event of any such loss,
damage or expense, the Custodian shall take all reasonable steps to
enforce such rights as it may have against the Securities System to
protect the interests of the Funds and the Portfolios.
(e) Reimbursement of Expenses. Each Fund agrees to reimburse the
Custodian for all reasonable out-of-pocket expenses incurred by the
Custodian on behalf of such Fund in connection with the fulfillment of
its obligations under this Section 5.02; provided, however, that such
reimbursement shall not apply to expenses occasioned by or resulting
from the negligence, misfeasance or misconduct of the Custodian.
Section 5.03. Indemnification.
(a) Indemnification Obligations. Subject to the limitations set
forth in this Agreement, each Fund severally and not jointly agrees to
indemnify and hold harmless the Custodian and its nominees from all
loss, damage and expense (including reasonable attorneys' fees)
suffered or incurred by the Custodian or its nominee caused by or
arising from actions taken by the Custodian on behalf of such Fund in
the performance of its duties and obligations under this Agreement;
provided, however, that such indemnity shall not apply to loss, damage
and expense occasioned by or resulting from the negligence,
misfeasance or misconduct of the Custodian or its nominee. In
addition, each Fund agrees severally and not jointly to indemnify any
Person against any liability incurred by reason of taxes assessed to
such Person, or other loss, damage or expenses incurred by such
Person, resulting from the fact that securities and other property of
such Fund's Portfolios are registered in the name of such Person;
provided, however, that in no event shall such indemnification be
applicable to income, franchise or similar taxes which may be imposed
or assessed against any Person.
(b) Notice of Litigation, Right to Prosecute, Etc. No Fund shall be
liable for indemnification under this Section 5.03 unless a Person
shall have promptly notified such Fund in writing of the commencement
of any litigation or proceeding brought against such Person in respect
of which indemnity may be sought under this Section 5.03. With
respect to claims in such litigation or proceedings for which
indemnity by a Fund may be sought and subject to applicable law and
the ruling of any court of competent jurisdiction, such Fund shall be
entitled to participate in any such litigation or proceeding and,
after written notice from such Fund to any Person, such Fund may
assume the defense of such litigation or proceeding with counsel of
its choice at its own expense in respect of that portion of the
litigation for which such Fund may be subject to an indemnification
obligation; provided, however, a Person shall be entitled to
participate in (but not control) at its own cost and expense, the
defense of any such litigation or proceeding if such Fund has not
acknowledged in writing its obligation to indemnify the Person with
respect to such litigation or proceeding. If such Fund is not
permitted to participate or control such litigation or proceeding
under applicable law or by a ruling of a court of competent
jurisdiction, such Person shall reasonably prosecute such litigation
or proceeding. A Person shall not consent to the entry of any
judgment or enter into any settlement in any such litigation or
proceeding without providing each applicable Fund with adequate notice
of any such settlement or judgment, and without each such Fund's prior
written consent. All Persons shall submit written evidence to each
applicable Fund with respect to any cost or expense for which they are
seeking indemnification in such form and detail as such Fund may
reasonably request.
Section 5.04. Investment Limitations. If the Custodian has
otherwise complied with the terms and conditions of this Agreement in
performing its duties generally, and more particularly in connection
with the purchase, sale or exchange of securities made by or for a
Portfolio, the Custodian shall not be liable to the applicable Fund
and such Fund agrees to indemnify the Custodian and its nominees, for
any loss, damage or expense suffered or incurred by the Custodian and
its nominees arising out of any violation of any investment or other
limitation to which such Fund is subject.
Section 5.05. Fund's Right to Proceed. Notwithstanding anything to
the contrary contained herein, each Fund shall have, at its election
upon reasonable notice to the Custodian, the right to enforce, to the
extent permitted by any applicable agreement and applicable law, the
Custodian's rights against any Subcustodian, Securities System, or
other Person for loss, damage or expense caused such Fund by such
Subcustodian, Securities System, or other Person, and shall be
entitled to enforce the rights of the Custodian with respect to any
claim against such Subcustodian, Securities System or other Person,
which the Custodian may have as a consequence of any such loss, damage
or expense, if and to the extent that such Fund has not been made
whole for any such loss or damage. If the Custodian makes such Fund
whole for any such loss or damage, the Custodian shall retain the
ability to enforce its rights directly against such Subcustodian,
Securities System or other Person. Upon such Fund's election to
enforce any rights of the Custodian under this Section 5.05, such Fund
shall reasonably prosecute all actions and proceedings directly
relating to the rights of the Custodian in respect of the loss, damage
or expense incurred by such Fund; provided that, so long as such Fund
has acknowledged in writing its obligation to indemnify the Custodian
under Section 5.03 hereof with respect to such claim, such Fund shall
retain the right to settle, compromise and/or terminate any action or
proceeding in respect of the loss, damage or expense incurred by such
Fund without the Custodian's consent and provided further, that if
such Fund has not made an acknowledgement of its obligation to
indemnify, such Fund shall not settle, compromise or terminate any
such action or proceeding without the written consent of the
Custodian, which consent shall not be unreasonably withheld or
delayed. The Custodian agrees to cooperate with each Fund and take
all actions reasonably requested by such Fund in connection with such
Fund's enforcement of any rights of the Custodian. Each Fund agrees
to reimburse the Custodian for all reasonable out-of-pocket expenses
incurred by the Custodian on behalf of such Fund in connection with
the fulfillment of its obligations under this Section 5.05; provided,
however, that such reimbursement shall not apply to expenses
occasioned by or resulting from the negligence, misfeasance or
misconduct of the Custodian.
ARTICLE VI
COMPENSATION
On behalf of each of its Portfolios, each Fund shall compensate the
Custodian in an amount, and at such times, as may be agreed upon in
writing, from time to time, by the Custodian and such Fund.
ARTICLE VII
TERMINATION
Section 7.01. Termination of Agreement as to One or More Funds.
With respect to each Fund, this Agreement shall continue in full force
and effect until the first to occur of: (a) termination by the
Custodian by an instrument in writing delivered or mailed to such
Fund, such termination to take effect not sooner than ninety (90) days
after the date of such delivery; (b) termination by such Fund by an
instrument in writing delivered or mailed to the Custodian, such
termination to take effect not sooner than thirty (30) days after the
date of such delivery; or (c) termination by such Fund by written
notice delivered to the Custodian, based upon such Fund's
determination that there is a reasonable basis to conclude that the
Custodian is insolvent or that the financial condition of the
Custodian is deteriorating in any material respect, in which case
termination shall take effect upon the Custodian's receipt of such
notice or at such later time as such Fund shall designate. In the
event of termination pursuant to this Section 7.01 by any Fund (a
"Terminating Fund"), each Terminating Fund shall make payment of all
accrued fees and unreimbursed expenses with respect to such
Terminating Fund within a reasonable time following termination and
delivery of a statement to the Terminating Fund setting forth such
fees and expenses. Each Terminating Fund shall identify in any notice
of termination a successor custodian or custodians to which the cash,
securities and other assets of its Portfolios shall, upon termination
of this Agreement with respect to such Terminating Fund, be delivered.
In the event that no written notice designating a successor custodian
shall have been delivered to the Custodian on or before the date when
termination of this Agreement as to a Terminating Fund shall become
effective, the Custodian may deliver to a bank or trust company doing
business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its
last published report, of not less than $25,000,000, all securities
and other assets of such Terminating Fund's Portfolios held by the
Custodian and all instruments held by the Custodian relative thereto
and all other property of the Terminating Fund's Portfolios held by
the Custodian under this Agreement. Thereafter, such bank or trust
company shall be the successor of the Custodian with respect to such
Terminating Fund under this Agreement. In the event that securities
and other assets of such Terminating Fund's Portfolios remain in the
possession of the Custodian after the date of termination hereof with
respect to such Terminating Fund owing to failure of the Terminating
Fund to appoint a successor custodian, the Custodian shall be entitled
to compensation for its services in accordance with the fee schedule
most recently in effect, for such period as the Custodian retains
possession of such securities and other assets, and the provisions of
this Agreement relating to the duties and obligations of the Custodian
and the Terminating Fund shall remain in full force and effect. In
the event of the appointment of a successor custodian, it is agreed
that the cash, securities and other property owned by a Terminating
Fund and held by the Custodian, any Subcustodian or nominee shall be
delivered to the successor custodian; and the Custodian agrees to
cooperate with such Terminating Fund in the execution of documents and
performance of other actions necessary or desirable in order to
substitute the successor custodian for the Custodian under this
Agreement.
Section 7.02. Termination as to One or More Portfolios. This
Agreement may be terminated as to one or more of a Fund's Portfolios
(but less than all of its Portfolios) by delivery of an amended
Appendix "A" deleting such Portfolios pursuant to Section 9.05(b)
hereof, in which case termination as to such deleted Portfolios shall
take effect thirty (30) days after the date of such delivery. The
execution and delivery of an amended Appendix "A" which deletes one or
more Portfolios shall constitute a termination of this Agreement only
with respect to such deleted Portfolio(s), shall be governed by the
preceding provisions of Section 7.01 as to the identification of a
successor custodian and the delivery of cash, securities and other
assets of the Portfolio(s) so deleted, and shall not affect the
obligations of the Custodian and any Fund hereunder with respect to
the other Portfolios set forth in Appendix "A," as amended from time
to time.
ARTICLE VIII
DEFINED TERMS
The following terms are defined in the following sections:
<TABLE>
<CAPTION>
<S> <C>
Term Section
Account 2.22
ADRs 2.06
Additional Custodian 2.23(a)
Authorized Person(s) 3.02
Banking Institution 2.12(a)
Business Day Appendix "C"
Bank Accounts 2.21
Distribution Account 2.16
Domestic Subcustodian 4.01
Foreign Subcustodian 4.02(a)
Fund Preamble
Institutional Client 2.03
Interim Subcustodian 4.02(b)
Overdraft 2.28
Overdraft Notice 2.28
Person 5.01(b)
Portfolio Preamble
Procedural Agreement 2.10
Proper Instructions 3.01(a)
SEC 2.22
Securities System 2.22
Shares 2.16
Special Instructions 3.01(b)
Special Subcustodian 4.03
Subcustodian Article IV
Terminating Fund 7.01
1940 Act Preamble
</TABLE>
ARTICLE IX
MISCELLANEOUS
Section 9.01. Execution of Documents, Etc.
(a) Actions by each Fund. Upon request, each Fund shall execute and
deliver to the Custodian such proxies, powers of attorney or other
instruments as may be reasonable and necessary or desirable in
connection with the performance by the Custodian or any Subcustodian
of their respective obligations to such Fund under this Agreement or
any applicable subcustodian agreement with respect to such Fund,
provided that the exercise by the Custodian or any Subcustodian of any
such rights shall in all events be in compliance with the terms of
this Agreement.
(b) Actions by Custodian. Upon receipt of Proper Instructions, the
Custodian shall execute and deliver to each applicable Fund or to such
other parties as such Fund(s) may designate in such Proper
Instructions, all such documents, instruments or agreements as may be
reasonable and necessary or desirable in order to effectuate any of
the transactions contemplated hereby.
Section 9.02. Representative Capacity; Nonrecourse Obligations. A
COPY OF THE DECLARATION OF TRUST OR OTHER ORGANIZATIONAL DOCUMENT OF
EACH FUND IS ON FILE WITH THE SECRETARY OF THE STATE OF THE FUND'S
FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT IS NOT
EXECUTED ON BEHALF OF THE TRUSTEES OF ANY FUND AS INDIVIDUALS, AND THE
OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE
TRUSTEES, OFFICERS, SHAREHOLDERS OR PARTNERS OF ANY FUND INDIVIDUALLY,
BUT ARE BINDING ONLY UPON THE ASSETS AND PROPERTY OF EACH FUND'S
RESPECTIVE PORTFOLIOS. THE CUSTODIAN AGREES THAT NO SHAREHOLDER,
TRUSTEE, OFFICER OR PARTNER OF ANY FUND MAY BE HELD PERSONALLY LIABLE
OR RESPONSIBLE FOR ANY OBLIGATIONS OF ANY FUND ARISING OUT OF THIS
AGREEMENT.
Section 9.03. Several Obligations of the Funds and the Portfolios.
WITH RESPECT TO ANY OBLIGATIONS OF A FUND ON BEHALF OF ANY OF ITS
PORTFOLIOS ARISING OUT OF THIS AGREEMENT, INCLUDING, WITHOUT
LIMITATION, THE OBLIGATIONS ARISING UNDER SECTIONS 2.28, 5.03, 5.05
and ARTICLE VI HEREOF, THE CUSTODIAN SHALL LOOK FOR PAYMENT OR
SATISFACTION OF ANY OBLIGATION SOLELY TO THE ASSETS AND PROPERTY OF
THE PORTFOLIO TO WHICH SUCH OBLIGATION RELATES AS THOUGH EACH FUND HAD
SEPARATELY CONTRACTED WITH THE CUSTODIAN BY SEPARATE WRITTEN
INSTRUMENT WITH RESPECT TO EACH OF ITS PORTFOLIOS.
Section 9.04. Representations and Warranties.
(a) Representations and Warranties of Each Fund. Each Fund hereby
severally and not jointly represents and warrants that each of the
following shall be true, correct and complete with respect to each
Fund at all times during the term of this Agreement: (i) the Fund is
duly organized under the laws of its jurisdiction of organization and
is registered as an open-end management investment company under the
1940 Act; and (ii) the execution, delivery and performance by the Fund
of this Agreement are (w) within its power, (x) have been duly
authorized by all necessary action, and (y) will not (A) contribute to
or result in a breach of or default under or conflict with any
existing law, order, regulation or ruling of any governmental or
regulatory agency or authority, or (B) violate any provision of the
Fund's corporate charter, Declaration of Trust or other organizational
document, or bylaws, or any amendment thereof or any provision of its
most recent Prospectus or Statement of Additional Information.
(b) Representations and Warranties of the Custodian. The Custodian
hereby represents and warrants to each Fund that each of the following
shall be true, correct and complete at all times during the term of
this Agreement: (i) the Custodian is duly organized under the laws of
its jurisdiction of organization and qualifies to act as a custodian
to open-end management investment companies under the provisions of
the 1940 Act; and (ii) the execution, delivery and performance by the
Custodian of this Agreement are (w) within its power, (x) have been
duly authorized by all necessary action, and (y) will not (A)
contribute to or result in a breach of or default under or conflict
with any existing law, order, regulation or ruling of any governmental
or regulatory agency or authority, or (B) violate any provision of the
Custodian's corporate charter, or other organizational document, or
bylaws, or any amendment thereof.
Section 9.05. Entire Agreement. This Agreement constitutes the
entire understanding and agreement of the Fund, on the one hand, and
the Custodian, on the other, with respect to the subject matter hereof
and accordingly, supersedes as of the effective date of this Agreement
any custodian agreement heretofore in effect between each Fund and the
Custodian.
Section 9.06. Waivers and Amendments. No provision of this
Agreement may be waived, amended or terminated except by a statement
in writing signed by the party against which enforcement of such
waiver, amendment or termination is sought; provided, however: (a)
Appendix "A" listing the Portfolios of each Fund for which the
Custodian serves as custodian may be amended from time to time to add
one or more Portfolios for one or more Funds, by each applicable
Fund's execution and delivery to the Custodian of an amended Appendix
"A", and the execution of such amended Appendix by the Custodian, in
which case such amendment shall take effect immediately upon execution
by the Custodian; (b) Appendix "A" may be amended from time to time to
delete one or more Portfolios (but less than all of the Portfolios) of
one or more of the Funds, by each applicable Fund's execution and
delivery to the Custodian of an amended Appendix "A", in which case
such amendment shall take effect thirty (30) days after such delivery,
unless otherwise agreed by the Custodian and each applicable Fund in
writing; (c) Appendix "B" listing Foreign Subcustodians, Special
Subcustodians and Additional Custodians approved by any Fund may be
amended from time to time to add or delete one or more Foreign
Subcustodians, Special Subcustodians or Additional Custodians for a
Fund or Funds by each applicable Fund's execution and delivery to the
Custodian of an amended Appendix "B", in which case such amendment
shall take effect immediately upon execution by the Custodian; and (d)
Appendix "C" setting forth the procedures relating to the Custodian's
security interest with respect to each Fund may be amended only by an
instrument in writing executed by each applicable Fund and the
Custodian.
Section 9.07. Interpretation. In connection with the operation of
this Agreement, the Custodian and any Fund may agree in writing from
time to time on such provisions interpretative of or in addition to
the provisions of this Agreement with respect to such Fund as may in
their joint opinion be consistent with the general tenor of this
Agreement. No interpretative or additional provisions made as
provided in the preceding sentence shall be deemed to be an amendment
of this Agreement or affect any other Fund.
Section 9.08. Captions. Headings contained in this Agreement, which
are included as convenient references only, shall have no bearing upon
the interpretation of the terms of the Agreement or the obligations of
the parties hereto.
Section 9.09. Governing Law. Insofar as any question or dispute may
arise in connection with the custodianship of foreign securities
pursuant to an agreement with a Foreign Subcustodian that is governed
by the laws of the State of New York, the provisions of this Agreement
shall be construed in accordance with and governed by the laws of the
State of New York, provided that in all other instances this Agreement
shall be construed in accordance with and governed by the laws of the
Commonwealth of Massachusetts, in each case without giving effect to
principles of conflicts of law.
Section 9.10. Notices. Except in the case of Proper Instructions or
Special Instructions, notices and other writings contemplated by this
Agreement shall be delivered by hand or by facsimile transmission
(provided that in the case of delivery by facsimile transmission,
notice shall also be mailed postage prepaid to the parties at the
following addresses:
(a) If to any Fund:
c/o Fidelity Management & Research Company
82 Devonshire Street
Boston, Massachusetts 02109
Attn: Treasurer of the Fidelity Funds
Telephone: (617) 563-7000
Telefax: (617) 476-4195
(b) If to the Custodian:
Brown Brothers Harriman & Company
40 Water Street
Boston, Massachusetts 02109
Attn: W. Casey Gildea, Assistant Manager
Telephone: (617) 772-1330
Telefax: (617) 772-2263
or to such other address as a Fund or the Custodian may have
designated in writing to the other.
Section 9.11. Assignment. This Agreement shall be binding on and
shall inure to the benefit of each Fund severally and the Custodian
and their respective successors and assigns, provided that, subject to
the provisions of Section 7.01 hereof, neither the Custodian nor any
Fund may assign this Agreement or any of its rights or obligations
hereunder without the prior written consent of the other party.
Section 9.12. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original.
With respect to each Fund, this Agreement shall become effective when
one or more counterparts have been signed and delivered by such Fund
and the Custodian.
Section 9.13. Confidentiality; Survival of Obligations. The parties
hereto agree that each shall treat confidentially the terms and
conditions of this Agreement and all information provided by each
party to the other regarding its business and operations. All
confidential information provided by a party hereto shall be used by
any other party hereto solely for the purpose of rendering services
pursuant to this Agreement and, except as may be required in carrying
out this Agreement, shall not be disclosed to any third party without
the prior consent of such providing party. The foregoing shall not be
applicable to any information that is publicly available when provided
or thereafter becomes publicly available other than through a breach
of this Agreement, or that is required to be disclosed by any bank
examiner of the Custodian or any Subcustodian, any auditor of the
parties hereto, by judicial or administrative process or otherwise by
applicable law or regulation. The provisions of this Section 9.13 and
Sections 9.01, 9.02, 9.03, 9.09, Section 2.28, Section 3.04, Section
7.01, Article V and Article VI hereof and any other rights or
obligations incurred or accrued by any party hereto prior to
termination of this Agreement shall survive any termination of this
Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed in its name and behalf on the day and year first above
written.
Each of the Investment Companies Listed on Brown Brothers Harriman &
Company
Appendix "A" Attached Hereto, on Behalf
of each of Their Respective Portfolios
[Signature Lines Omitted]
Exhibit g(16)
Form of
Appendix "B"
To
Custodian Agreement
Between
Brown Brothers Harriman & Co. and Each of the Investment
Companies Listed on Appendix "A" thereto
Dated as of
The following is a list of Additional Custodians, Special
Subcustodians and Foreign Subcustodians under the Custodian Agreement
dated as of September 1, 1994 (the "Custodian Agreement"):
A. Additional Custodians
CUSTODIAN PURPOSE
Bank of New York FICASH
FITERM
B. Special Subcustodians:
SUBCUSTODIAN PURPOSE
Bank of New York FICASH
C. Foreign Subcustodians:
<TABLE>
<CAPTION>
<S> <C> <C>
OUNTRY FOREIGN SUBCUSTODIAN DEPOSITORY
Argentina Citibank, N.A., Buenos Aires Caja de Valores, S.A.;
(Citibank, N.A., New York Agt. 7/16/81 Central de Registracion y
New York Agreement Amendment 8/31/90) Liquidacion de Instrumentos
de Endeudamiento Publico (CRYL)
First National Bank of Boston, Buenos Aires
(First Nat. Bank of Boston Agreement 1/15/88
Omnibus Amendment 2/22/94)
Australia National Australia Bank Ltd., Melbourne Austraclear Limited;
(National Australia Bank Agt. 5/1/85 Reserve Bank Information and
Agreement Amendment 2/13/92 Transfer System (RITS)
Omnibus Amendment 11/22/93)
Austria Creditanstalt-Bankverein, Vienna Oesterreichische Kontrollbank
(Creditanstalt Bankverein Agreement 12/18/89 Aktiengesellschaft (OEKB)
Omnibus Amendment 1/17/94)
Bahrain British Bank of the Middle East, Manama None
Bangladesh Standard Chartered Bank, Dhaka None
(Standard Chartered Bank Agreement 2/18/92)
Belgium Banque Bruxelles Lambert, Brussels Caisse Interprofessionnelle de Depot
(Banque Bruxelles Lambert Agreement 11/15/90 et Virements de Titres (CIK)
Omnibus Amendment 3/1/94)
Banque Nationale de Belgique (BNB)
Bostwana Barclays Bank of Bostwana Ltd., Gaborone None
(Barclays Bank Agreement 10/5/94)
Brazil First National Bank of Boston, Sao Paulo Sao Paulo Stock Exchange
(First National Bank of Boston Agreement 1/5/88 (BOVESPA), Sistema Especial de
Omnibus Amendment 2/22/94) Liquidacao e Custodia (SELIC);
Rio de Janeiro Exchange (BVRJ)
Canada Canadian Imperial Bank of Commerce, Toronto Canadian Depository for Securities,
(Canadian Imperial Bank of Commerce Ltd., (CDS)
Agreement 9/9/88
Omnibus Amendment 12/1/93)
Royal Bank of Canada, Toronto Bank of Canada
Proposed Agreement
Chile Citibank, N.A., Santiago None
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90)
China-Shanghai Standard Chartered Bank, Shanghai Shanghai Securities Central Clearing
(Standard Chartered Bank Agreement 2/18/92) & Registration Corporation
(SSCCRC)
China-Shenzhen Standard Chartered Bank, Shenzhen Shenzhen Securities Registration
(Standard Chartered Bank Agreement 2/18/92) Corp. Ltd., (SSRC)
Colombia Cititrust Colombia , S.A., Sociedad Fiduciaria,
Bogota None
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90
Citibank N.A. Subsidiary Amendment 10/19/95
Citibank N.A./Cititrust Colombia Agreement 12/2/91)
Czech Republic Ceskoslovenska Obchodni Banka, S.A., Prague Stredisko Cennych Papiru (SCP)
(Ceskoslovenska Obchodni Banka Agreement 2/28/94)
Czech National Bank
Denmark Den Danske Bank, Copenhagen Vaerdipapircentralen - VP Center
(Den Danske Bank Agreement 1/1/89
Omnibus Amendment 12/1/93)
Ecuador Citibank, N.A., Quito None
(Citibank, N.A. New York Agreement 7/16/81
New York Agreement Amendment 8/31/90
Citibank, Quito Side Letter 7/3/95)
Egypt Citibank, N.A., Cairo Misr for Clearing, Settlement
(Citibank, N.A. New York Agreement 7/16/81 and Depository
New York Agreement Amendment 8/31/90)
Finland Merita Bank Ltd., Helsinki Central Share Register of
Finland Cooperative (CSR)
Helsinki Money Market Center, Ltd.
(HMMC)
Finnish Central Securities
Depository Ltd.
France Banque Paribas, Paris SICOVAM
Agreement 4/2/93) Banque de France
Germany Dresdner Bank AG, Frankfurt Deutscher Kassenverein AG (DKV)
(Dresdner Bank Agreement 10/6/95)
Ghana Barclays Bank of Ghana Ltd., Accra None
(Barclays Bank Agreement 10/5/94)
Greece Citibank, N.A., Athens Apothetirion Titlon A.E.
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90)
Hong Kong The Hongkong & Shanghai Banking Hong Kong Securities Clearing Co.
Corp., Ltd., Hong Kong Ltd. (HKSCC);
(Hongkong & Shanghai Banking Corp. Agt. 4/19/91 Central Clearing and
Omnibus Supplement 12/29/93) Settlement System (CCASS)
Hungary Citibank Budapest, Rt. Central Depository and Clearing
(Citibank N.A., New York Agreement 7/16/81 House (Budapest) Ltd.,
New York Agreement Amendment 8/31/90 (KELER Ltd.)
Citibank N.A. Subsidiary Amendment 10/19/95
Citibank N.A./Citibank Budapest Agmt. 1/24/92
(amended 6/23/92 and 9/29/92))
India Citibank, N.A., Mumbai National Securities Depository Limted
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90
Citibank, Mumbai Amendment 11/17/93)
Standard Chartered Bank, Mumbai
(Standard Chartered Bank Agreement 2/18/92
SCB, Mumbai Annexure and Side Letter 7/18/94)
Indonesia Citibank, N.A., Jakarta None
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90)
Ireland Allied Irish Banks, plc., Dublin Gilt Settlement Office (GSO)
(Allied Irish Banks Agreement 1/10/89
Omnibus Amendment 4/8/94) CREST
Israel Bank Hapoalim, B.M. Tel-Aviv Stock Exchange
(Bank Hapoalim Agreement 8/27/92) (TASE) Clearinghouse Ltd.
Italy Banca Commerciale Italiana, Milan Monte Titoli S.p.A.
(Banca Commerciale Italiana Agreement 5/8/89
Agreement Amendment 10/8/93 Banca D'Italia
Omnibus Amendment 12/14/93)
Japan Sumitomo Trust & Banking Co., Tokyo Japan Securities Depository Center
(Sumitomo Trust & Banking Agreement 7/17/92 (JASDEC)
Omnibus Amendment 1/13/94); Bank of Japan
Jordan Arab Bank, plc, Amman None
(Arab Bank Agreement 4/5/95
Kenya Barclays Bank of Kenya Ltd., Nairobi None
(Barclays Bank Agreement 10/5/94)
Lebanon British Bank of the Middle East, Beirut Midclear
Malaysia Hongkong Bank Malaysia Berhad Malaysian Central Depository Sdn.
(Hongkong & Shanghai Banking Corp. Agt. 4/19/91 Bhd. (MCD)
Omnibus Supplement 12/29/93
Malaysia Subsidiary Supplement 5/23/94) Bank Negara Malaysia
Mauritius Hongkong & Shanghai Banking Corp., Ltd., Central Depository & Settlement Co.,
Port Louis Ltd.
Mexico Citibank Mexico, S.A., Mexico City Institucion para el Deposito de
(Citibank N.A., New York Agreement 7/16/81 Valores- S.D. INDEVAL, S.A. de
New York Agreement Amendment 8/31/90 C.V.
Citibank, Mexico, S.A. Amendment 2/7/95)
Banco de Mexico
Morocco Banque Marocaine du Commerce Exterieur, None
Casablanca
(BMCE Agreement 7/6/94)
Namibia Standard Bank Namibia Ltd., Windhoek None
Netherlands ABN-AMRO, Bank N. V., Amsterdam Nederlands Centraal Instituut voor
Giraal Effektenverkeer BV (NECIGEF)/KAS Associatie N.V.
(ABN-AMRO Agreement 12/19/88) (KAS)
De Nederlandsche Bank (DNB)New
New Zealand National Australia Bank Ltd., Melbourne Reserve Bank of New Zealand
(RBNZ)
(National Australia Bank Agreement 5/1/85
Agreement Amendment 2/13/92 New Zealand Securities
Omnibus Amendment 11/22/93 Depository Limited (NZCDS)
New Zealand Addendum 3/7/89)
Norway Den norske Bank ASA, Oslo Verdipapirsentralen (VPS)
(Den norske Bank Agreement 11/16/94)
Oman British Bank of the Middle East, Muscat Muscat Securities Market
Pakistan Standard Chartered Bank, Karachi None
(Standard Chartered Bank Agreement 2/18/92)
Peru Citibank, N.A., Lima Caja de Valores (CAVAL)
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90)
Philippines Citibank, N.A., Manila The Philippines Central Depository,
(Citibank N.A., New York Agreement 7/16/81 Inc.
New York Agreement Amendment 8/31/90)
Poland Citibank Poland, S.A. National Depository of Securities
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90 National Bank of Poland
Citibank Subsidiary Amendment 10/19/95
Citibank, N.A./Citibank Poland S.A. Agt. 11/6/92)
Bank Polska Kasa Opieki S.A., Warsaw
Portugal Banco Espirito Santo e Comercial Central de Valores Mobiliaros
de Lisboa, S.A., Lisbon (Interbolsa)
(BESCL Agreement 4/26/89
Omnibus Amendment 2/23/94)
Singapore Hongkong & Shanghai Banking Central Depository Pte Ltd. (CDP)
Corp., Ltd., Singapore
(Hongkong & Shanghai Banking Corp. Agt. 4/19/91
Omnibus Supplement 12/29/93)
Slovak Republic Ceskoslovenska Obchodna Banka, S.A., Bratislava Stredisko Cennych Papeirov (SCP)
(Ceskoslovenska Obchodna Banka Agmt. 10/12/94)
National Bank of Slovakia
South Africa First National Bank of Southern Africa Ltd., The Central Depository (Pty) Ltd.
Johannesburg (CD)
(First National Bank of Southern Africa Agmt. 8/7/91)
South Korea Citibank, N.A., Seoul Korean Securities Depository (KSD)
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90
Citibank, Seoul Agreement Supplement 10/28/94)
Spain Banco Santander S.A., Madrid Servicio de Compensacion y
(Banco Santander Agreement 12/14/88) Liquidacion de Valores (SCLV)
Banco de Espana
Sri Lanka Hongkong & Shanghai Banking Corp. Ltd., Central Depository System (Pvt)
Colombo Limited (CDS)
(Hongkong & Shanghai Banking Corp. Agt. 4/19/91
Omnibus Supplement 12/29/93)
Swaziland Barclays Bank of Swaziland Ltd., Mbabne None
(Barclays Bank Agreement 10/5/94)
Sweden Skandinaviska Enskilda Banken, Stockholm Vardepappercentralen VPC AB
(Skandinaviska Enskilda Banken Agreement 2/20/89
Omnibus Amendment 12/3/93)
Switzerland Swiss Bank Corporation, Basel Schweizerische Effekten - Giro A.G.
(Swiss Bank Corporation Agreement 3/1/94) (SEGA)
Taiwan Standard Chartered Bank, Taipei Taiwan Securities Central Depository
(Standard Chartered Bank Agmt. 2/18/92) Co. Ltd. (TSCD)
Thailand Hongkong & Shanghai Banking Corp. Ltd., Thailand Securities Depository
Bangkok Company (TSD)
(Hongkong & Shanghai Banking Corp. Agmt. 4/19/91
Omnibus Amendment 12/29/93)
Transnational Cedel Bank Societe
Anonyme, Luxembourg
Euroclear Clearance System
Societe Cooperative, Belgium
Turkey Citibank, N.A., Istanbul Takas ve Saklama Bankasi A.S. (TvS)
(Citibank N.A., New York Agmt. 7/16/81
New York Agmt. Amendment 8/31/90) Central Bank of Turkey (CBT)
United Kingdom Lloyds Bank PLC, London Central Gilts Office (CGO);
CREST;
Central Money Markets Office
(CMO)
Uruguay First National Bank of Boston, Montevideo None
Venezuela Citibank, N.A., Caracas None
(Citibank N.A., New York Agreement 7/16/81
New York Agreement Amendment 8/31/90)
Zambia Stanbic Bank Zambia Ltd., Lusaka Lusaka Central Depository
Zimbabwe Stanbic Bank Zimbabwe Ltd., Harare None
</TABLE>
Each of the Investment Companies Listed on
Appendix "A" to the Custodian Agreement,
on Behalf of Each of Their Respective
Portfolios
[Signature Lines Omitted]
Exhibit g(16)
Form of
Appendix "C" to the
Custodian Agreement
Between
Each of the Investment Companies
Listed on Appendix "A" Thereto
And
BROWN BROTHERS HARRIMAN & COMPANY
Dated as of _______
PROCEDURES RELATING TO CUSTODIAN'S SECURITY INTEREST
As security for any Overdrafts (as defined in the Custodian
Agreement) of any Portfolio, the applicable Fund, on behalf of such
Portfolio, shall pledge, assign and grant to the Custodian a security
interest in Collateral (as hereinafter defined), under the terms,
circumstances and conditions set forth in this Appendix "C".
Section 1. Defined Terms. As used in this Appendix "C" the
following terms shall have the following respective meanings:
(a) "Business Day" shall mean any day that is not a Saturday, a
Sunday or a day on which the Custodian is closed for business.
(b) "Collateral" shall mean, with respect to any Portfolio,
securities held by the Custodian on behalf of the Portfolio having a
fair market value (as determined in accordance with the procedures set
forth in the prospectus for the Portfolio) equal to the aggregate of
all Overdraft Obligations of such Portfolio: (i) identified in any
Pledge Certificate executed on behalf of such Portfolio; or (ii)
designated by the Custodian for such Portfolio pursuant to Section 3
of this Appendix C. Such securities shall consist of marketable
securities held by the Custodian on behalf of such Portfolio or, if no
such marketable securities are held by the Custodian on behalf of such
Portfolio, such other securities designated by the applicable Fund in
the applicable Pledge Certificate or by the Custodian pursuant to
Section 3 of this Appendix C.
(c) "Overdraft Obligations" shall mean, with respect to any
Portfolio, the amount of any outstanding Overdraft(s) provided by the
Custodian to such Portfolio together with all accrued interest
thereon.
(d) "Pledge Certificate" shall mean a Pledge Certificate in the form
attached to this Appendix "C" as Schedule 1 executed by a duly
authorized officer of the applicable Fund and delivered by such Fund
to the Custodian by facsimile transmission or in such other manner as
the applicable Fund and the Custodian may agree in writing.
(e) "Release Certificate" shall mean a Release Certificate in the
form attached to this Appendix "C" as Schedule 2 executed by a duly
authorized officer of the Custodian and delivered by the Custodian to
the applicable Fund by facsimile transmission or in such other manner
as such Fund and the Custodian may agree in writing.
(f) "Written Notice" shall mean a written notice executed by a duly
authorized officer of the party delivering the notice and delivered by
facsimile transmission or in such other manner as the applicable Fund
and the Custodian shall agree in writing.
Section 2. Pledge of Collateral. To the extent that any Overdraft
Obligations of a Portfolio are not satisfied by the close of business
on the first Business Day following the Business Day on which the
applicable Fund receives Written Notice requesting security for such
Overdraft Obligation and stating the amount of such Overdraft
Obligation, the applicable Fund, on behalf of such Portfolio, shall
pledge, assign and grant to the Custodian a first priority security
interest, by delivering to the Custodian, a Pledge Certificate
executed by such Fund on behalf of such Portfolio describing the
applicable Collateral. Such Written Notice may, in the discretion of
the Custodian, be included within or accompany the Overdraft Notice
relating to the applicable Overdraft Obligations.
Section 3. Failure to Pledge Collateral. In the event that the
applicable Fund shall fail: (a) to pay, on behalf of the applicable
Portfolio, the Overdraft Obligation described in such Written Notice;
(b) to deliver to the Custodian a Pledge Certificate pursuant to
Section 2; or (c) to identify substitute securities pursuant to
Section 6 upon the sale or maturity of any securities identified as
Collateral, the Custodian may, by Written Notice to the applicable
Fund specify Collateral which shall secure the applicable Overdraft
Obligation. Such Fund, on behalf of any applicable Portfolio, hereby
pledges, assigns and grants to the Custodian a first priority security
interest in any and all Collateral specified in such Written Notice;
provided that such pledge, assignment and grant of security shall be
deemed to be effective only upon receipt by the applicable Fund of
such Written Notice.
Section 4. Delivery of Additional Collateral. If at any time the
Custodian shall notify a Fund by Written Notice that the fair market
value of the Collateral securing any Overdraft Obligation of one of
such Fund's Portfolios is less than the amount of such Overdraft
Obligation, such Fund, on behalf of the applicable Portfolio, shall
deliver to the Custodian, within one (1) Business Day following the
Fund's receipt of such Written Notice, an additional Pledge
Certificate describing additional Collateral. If such Fund shall fail
to deliver such additional Pledge Certificate, the Custodian may
specify Collateral which shall secure the unsecured amount of the
applicable Overdraft Obligation in accordance with Section 3 of this
Appendix C.
Section 5. Release of Collateral. Upon payment by a Fund, on behalf
of one of its Portfolios, of any Overdraft Obligation secured by the
pledge of Collateral, the Custodian shall promptly deliver to such
Fund a Release Certificate pursuant to which the Custodian shall
release Collateral from the lien under the applicable Pledge
Certificate or Written Notice pursuant to Section 3 having a fair
market value equal to the amount paid by such Fund on account of such
Overdraft Obligation. In addition, if at any time a Fund shall notify
the Custodian by Written Notice that such Fund desires that specified
Collateral be released and: (a) that the fair market value of the
Collateral securing any Overdraft Obligation shall exceed the amount
of such Overdraft Obligation; or (b) that the Fund has delivered a
Pledge Certificate substituting Collateral for such Overdraft
Obligation, the Custodian shall deliver to such Fund, within one (1)
Business Day following the Custodian's receipt of such Written Notice,
a Release Certificate relating to the Collateral specified in such
Written Notice.
Section 6. Substitution of Collateral. A Fund may substitute
securities for any securities identified as Collateral by delivery to
the Custodian of a Pledge Certificate executed by such Fund on behalf
of the applicable Portfolio, indicating the securities pledged as
Collateral.
Section 7. Security for Individual Portfolios' Overdraft
Obligations. The pledge of Collateral by a Fund on behalf of any of
its individual Portfolios shall secure only the Overdraft Obligations
of such Portfolio. In no event shall the pledge of Collateral by one
of a Fund's Portfolios be deemed or considered to be security for the
Overdraft Obligations of any other Portfolio of such Fund or of any
other Fund.
Section 8. Custodian's Remedies. Upon (a) a Fund's failure to pay
any Overdraft Obligation of an applicable Portfolio within thirty (30)
days after receipt by such Fund of a Written Notice demanding security
therefore, and (b) one (1) Business Day's prior Written Notice to such
Fund, the Custodian may elect to enforce its security interest in the
Collateral securing such Overdraft Obligation, by taking title to (at
the then prevailing fair market value), or selling in a commercially
reasonable manner, so much of the Collateral as shall be required to
pay such Overdraft Obligation in full. Notwithstanding the provisions
of any applicable law, including, without limitation, the Uniform
Commercial Code, the remedy set forth in the preceding sentence shall
be the only right or remedy to which the Custodian is entitled with
respect to the pledge and security interest granted pursuant to any
Pledge Certificate or Section 3. Without limiting the foregoing, the
Custodian hereby waives and relinquishes all contractual and common
law rights of set off to which it may now or hereafter be or become
entitled with respect to any obligations of any Fund to the Custodian
arising under this Appendix "C" to the Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Appendix to
be executed in its name and behalf on the day and year first above
written.
Each of the Investment Companies Listed on BROWN BROTHERS HARRIMAN &
Schedule "A" to the Custodian Agreement, on COMPANY
Behalf of Each of Their Respective Portfolios
[Signature lines omitted]
SCHEDULE 1
TO
APPENDIX "C"
PLEDGE CERTIFICATE
This Pledge Certificate is delivered pursuant to the Custodian
Agreement dated as of [ ] (the "Agreement"), between [
] (the "Fund") and [ ] (the "Custodian"). Capitalized terms
used herein without definition shall have the respective meanings
ascribed to them in the Agreement. Pursuant to [Section 2 or Section
4] of Appendix "C" attached to the Agreement, the Fund, on behalf of [
] (the "Portfolio"), hereby pledges, assigns and grants to the
Custodian a first priority security interest in the securities listed
on Exhibit "A" attached to this Pledge Certificate (collectively, the
"Pledged Securities"). Upon delivery of this Pledge Certificate, the
Pledged Securities shall constitute Collateral, and shall secure all
Overdraft Obligations of the Portfolio described in that certain
Written Notice dated , 19 , delivered by the Custodian to
the Fund. The pledge, assignment and grant of security in the Pledged
Securities hereunder shall be subject in all respect to the terms and
conditions of the Agreement, including, without limitation, Sections 7
and 8 of Appendix "C" attached thereto.
IN WITNESS WHEREOF, the Fund has caused this Pledge Certificate to be
executed in its name, on behalf of the Portfolio this day of
19 .
[FUND], on Behalf of [Portfolio]
By: ___________________
Name: ___________________
Title: ___________________
EXHIBIT "A"
TO
PLEDGE CERTIFICATE
Type of Certificate/CUSIP Number of
Issuer Security Numbers Shares
SCHEDULE 2
TO
APPENDIX "C"
RELEASE CERTIFICATE
This Release Certificate is delivered pursuant to the Custodian
Agreement dated as of [ ] (the "Agreement"), between [
] (the "Fund") and [ ] (the "Custodian"). Capitalized terms
used herein without definition shall have the respective meanings
ascribed to them in the Agreement. Pursuant to Section 5 of Appendix
"C" attached to the Agreement, the Custodian hereby releases the
securities listed on Exhibit "A" attached to this Release Certificate
from the lien under the [Pledge Certificate dated ___________, 19 or
the Written Notice delivered pursuant to Section 3 of Appendix "C"
dated _________, 19 ].
IN WITNESS WHEREOF, the Custodian has caused this Release Certificate
to be executed in its name and on its behalf this day of 19 .
BROWN BROTHERS HARRIMAN & COMPANY
By: _____________________
Name: _____________________
Title: _____________________
EXHIBIT "A"
TO
RELEASE CERTIFICATE
Type of Certificate/CUSIP Number of
Issuer Security Numbers Shares
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference into the
Prospectus and Statement of Additional Information in Post-Effective
Amendment No. 66 to the Registration Statement on Form N-1A of
Fidelity Select Portfolios, of our report dated April 19, 1999 on the
financial statements and financial highlights included in the February
28, 1999 Annual Report to Shareholders of Fidelity Select Portfolios.
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectus and "Auditor" in the
Statement of Additional Information.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
April 26, 1999
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<C>
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<NAME> Fidelity Select Portfolios
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<NUMBER> 7
<NAME> Select-Leisure
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<C>
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<NAME> Fidelity Select Portfolios
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<NAME> Select-Defense and Aerospace
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<C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
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<NAME> Select-Brokerage and Investment Management
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<C>
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<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 10
<NAME> Select-Chemicals
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<C>
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<NAME> Fidelity Select Portfolios
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<C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 12
<NAME> Select-Electronics
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<C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 13
<NAME> Select-Food and Agriculture
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<C>
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<NAME> Fidelity Select Portfolios
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<NAME> Select-Software and Computer Services
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<C>
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<NAME> Fidelity Select Portfolios
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<C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 16
<NAME> Select-Money Market
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<C>
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<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 17
<NAME> Select-Air Transportation
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<C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 18
<NAME> Select-Gold
<MULTIPLIER> 1,000
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<C>
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<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 19
<NAME> Select-Biotechnology
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<C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 20
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<C>
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<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 22
<NAME> Select-Insurance
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<C>
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<PER-SHARE-NII> (.040)
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 23
<NAME> Select-Retailing
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<C>
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<NAME> Fidelity Select Portfolios
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<NAME> Select-Paper and Forest Products
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<NAME> Fidelity Select Portfolios
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<NAME> Select-Regional Banks
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<NAME> Fidelity Select Portfolios
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<NAME> Select-Transportation
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<NAME> Fidelity Select Portfolios
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<NUMBER> 37
<NAME> Select-Environmental
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<NET-CHANGE-IN-ASSETS> (9,650)
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<PER-SHARE-NII> (.180)
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 38
<NAME> Select-Consumer Products
<MULTIPLIER> 1,000
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<C>
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<TABLE> <S> <C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 39
<NAME> Select-Developing Communication
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<C>
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<ACCUM-APPREC-OR-DEPREC> 123,958
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<NET-INVESTMENT-INCOME> (1,997)
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<GROSS-EXPENSE> 4,294
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<PER-SHARE-NAV-BEGIN> 20.140
<PER-SHARE-NII> (.160)
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<TABLE> <S> <C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 40
<NAME> Select-Natural Gas
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<C>
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<ACCUMULATED-NET-GAINS> (5,436)
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<NET-CHANGE-IN-ASSETS> (23,037)
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<GROSS-EXPENSE> 809
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<PER-SHARE-GAIN-APPREC> (2.680)
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<TABLE> <S> <C>
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<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 41
<NAME> Select-Cyclical Industries
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<C>
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<PER-SHARE-NII> (.130)
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<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 42
<NAME> Select-Natural Resources
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<C>
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<ACCUMULATED-NET-GAINS> (1,233)
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<ACCUM-APPREC-OR-DEPREC> (744)
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<NET-CHANGE-IN-ASSETS> (2,386)
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<PER-SHARE-NII> (.050)
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<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 43
<NAME> Select-Business Sevices and Outsourcing
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<C>
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<GROSS-EXPENSE> 920
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<PER-SHARE-NII> (.110)
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<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000320351
<NAME> Fidelity Select Portfolios
<SERIES>
<NUMBER> 44
<NAME> Select-Medical Equipment & Systems
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<C>
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