(2_FIDELITY_LOGOS)FIDELITY
TREND
FUND
ANNUAL REPORT
DECEMBER 31, 1994
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 6 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 9 A summary of major shifts in the
fund's investments over the past six
months.
INVESTMENTS 10 A complete list of the fund's
investments with their market
values.
FINANCIAL STATEMENTS 23 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
NOTES 27 Notes to the financial statements.
REPORT OF INDEPENDENT 31 The auditors' opinion.
ACCOUNTANTS
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMA-
TION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED FOR
DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE
PROSPECTUS. MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES
ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY,
AND ARE
SUBJECT TO INVESTMENT RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
NEITHER THE FUND NOR
FIDELITY DISTRIBUTORS CORPORATION IS A BANK. FOR MORE INFORMATION ON ANY
FIDELITY FUND,
INCLUDING CHARGES AND EXPENSES, CALL 1-800-544-8888 FOR A FREE PROSPECTUS.
READ IT
CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
The unsettling period that began for investors when the Federal Reserve
Board raised short-term interest rates in February continued into the
fourth quarter of 1994. The Board raised the federal funds rate - the rate
banks charge each other for overnight loans - five times from February
through August, taking it from 3.00% to 4.75%. A sixth increase in November
lifted the rate to 5.50%. The Fed rate hikes were intended to forestall
inflation that could result from an improving U.S. economy, and they led to
below-average returns for many stocks and negative returns for many bond
investments.
The volatility we have witnessed this year follows a period in which there
was a nearly perfect investing environment. Although there was a
late-summer rally in stocks and, to a lesser extent in bond markets, it is
impossible to predict where interest rates might go or what might happen in
the markets in the months ahead. That's why it probably is a good time to
again review your investment portfolio and how well it matches your goals.
If you can leave your money invested over the long term, you can avoid much
of the volatility that generally accompanies the stock market in the short
term, as we have been witnessing this year. You also can help to manage
risk through diversification of investments. A stock fund is already
diversified because it invests in many issues. You can diversify even
further by placing some of your money in several different stock funds or
in other investment categories, such as bonds.
If you have a short investment time horizon, you might want to consider
moving some of your investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. As with any mutual fund, of course, there is no assurance that
a money market fund will achieve its goal, and it is important to remember
that money market funds are not insured by any agency of the U.S.
government.
Finally, no matter what your investment horizon or portfolio diversity, it
makes good sense to follow a regular investment plan - investing a certain
amount of money at the same time each month or quarter - and to review your
portfolio periodically, as we have discussed here. A periodic investment
plan will not, of course, assure a profit or protect against a loss.
If you have any questions, please call us at 1-800-544-8888. We stand ready
to provide the information you need to make the investments that are right
for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each
performance figure includes changes in a fund's share price, plus
reinvestment of any dividends (or income) and capital gains (the profits
the fund earns when it sells stocks that have grown in value).
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1994 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Trend -6.70% 54.51% 252.93%
S&P 500(registered trademark) 1.32% 51.77% 283.58%
Average Growth Fund -2.17% 53.00% 239.11%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one, five, or 10 years. For example, if
you had invested $1,000 in a fund that had a 5% return over the past year,
you would end up with $1,050. You can compare these figures to the
performance of the Standard & Poor's Composite Index of 500 Stocks - a
common proxy for the U.S. stock market. You can also compare them to the
average growth fund, which currently reflects the performance of 481 growth
funds tracked by Lipper Analytical Services, Inc. Both benchmarks include
reinvested dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1994 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Trend -6.70% 9.09% 13.44%
S&P 500(registered trademark) 1.32% 8.70% 14.39%
Average Growth Fund -2.17% 8.59% 12.55%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
Trend (005) Standard & Poor's 50
12/31/84 10000.00 10000.00
01/31/85 11090.95 10779.00
02/28/85 11068.55 10911.58
03/31/85 10825.01 10919.22
04/30/85 10578.67 10909.39
05/31/85 11211.32 11539.96
06/30/85 11561.23 11721.13
07/31/85 11748.79 11703.55
08/31/85 11561.23 11604.07
09/30/85 11057.35 11240.86
10/31/85 11429.66 11760.19
11/30/85 12356.24 12566.94
12/31/85 12825.61 13175.18
01/31/86 13289.98 13248.96
02/28/86 14536.00 14239.98
03/31/86 15405.97 15034.57
04/30/86 15045.77 14864.68
05/31/86 15662.38 15655.49
06/30/86 15695.95 15920.06
07/31/86 14413.91 15030.13
08/31/86 15192.29 16145.37
09/30/86 13998.77 14810.15
10/31/86 14655.05 15664.69
11/30/86 14948.09 16045.34
12/31/86 14560.73 15636.19
01/31/87 16308.17 17742.38
02/28/87 17341.86 18443.20
03/31/87 17580.04 18976.21
04/30/87 17304.65 18807.33
05/31/87 17118.58 18970.95
06/30/87 17795.88 19928.98
07/31/87 18912.31 20939.38
08/31/87 19500.29 21720.42
09/30/87 19016.51 21244.74
10/31/87 13393.43 16668.63
11/30/87 12637.98 15295.13
12/31/87 13955.26 16459.09
01/31/88 14653.02 17152.02
02/29/88 15835.22 17951.30
03/31/88 16030.77 17396.61
04/30/88 16515.20 17589.71
05/31/88 16159.66 17742.74
06/30/88 17337.41 18557.13
07/31/88 17110.75 18486.61
08/31/88 16577.43 17858.07
09/30/88 16977.42 18618.82
10/31/88 17070.75 19136.43
11/30/88 16608.54 18862.78
12/31/88 17350.19 19192.87
01/31/89 18712.99 20597.79
02/28/89 18680.74 20084.91
03/31/89 19199.65 20552.89
04/30/89 20354.34 21619.58
05/31/89 21312.69 22495.17
06/30/89 21050.89 22366.95
07/31/89 22401.93 24386.69
08/31/89 23252.75 24864.67
09/30/89 23364.95 24762.72
10/31/89 22041.96 24188.23
11/30/89 22308.43 24681.66
12/31/89 22841.93 25274.02
01/31/90 20868.70 23578.14
02/28/90 21384.81 23882.30
03/31/90 21768.35 24515.18
04/30/90 20711.03 23902.30
05/31/90 22675.36 26232.77
06/30/90 22711.64 26054.39
07/31/90 22260.73 25971.01
08/31/90 20042.43 23623.23
09/30/90 18508.28 22472.78
10/31/90 17725.65 22376.15
11/30/90 19311.63 23821.65
12/31/90 19950.21 24486.27
01/31/91 21201.98 25553.87
02/28/91 23090.08 27380.98
03/31/91 23606.44 28043.60
04/30/91 23846.36 28110.90
05/31/91 24962.53 29325.29
06/30/91 23204.83 27982.19
07/31/91 24811.28 29286.16
08/31/91 25416.30 29980.25
09/30/91 25249.40 29479.58
10/31/91 25515.40 29874.60
11/30/91 24054.99 28670.66
12/31/91 27187.46 31950.58
01/31/92 27357.28 31356.30
02/29/92 28011.09 31763.93
03/31/92 27101.10 31144.53
04/30/92 26941.17 32060.18
05/31/92 27602.98 32217.28
06/30/92 26974.26 31737.24
07/31/92 28490.90 33035.29
08/31/92 28038.67 32358.07
09/30/92 28457.81 32739.89
10/31/92 29136.17 32854.48
11/30/92 30851.36 33974.82
12/31/92 31747.43 34392.71
01/31/93 32508.90 34681.61
02/28/93 32318.72 35153.28
03/31/93 33675.12 35895.02
04/30/93 32436.15 35026.36
05/31/93 34197.71 35965.06
06/30/93 34826.00 36069.36
07/31/93 34732.05 35925.08
08/31/93 36552.33 37286.64
09/30/93 37350.90 36999.54
10/31/93 38032.04 37765.43
11/30/93 36270.48 37406.66
12/31/93 37826.56 37859.28
01/31/94 39331.17 39146.49
02/28/94 37954.61 38085.62
03/31/94 35496.01 36425.09
04/30/94 35694.50 36891.33
05/31/94 35771.33 37496.35
06/30/94 34772.52 36577.69
07/31/94 35707.30 37777.44
08/31/94 37768.94 39326.31
09/30/94 36955.81 38362.82
10/31/94 37122.27 39225.98
11/30/94 35079.85 37797.37
12/30/94 35293.39 38357.90
$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity Trend
Fund on December 31, 1984. As the chart shows, by December 31, 1994, the
value of your investment would have grown to $35,293 - a 252.93% increase
on your initial investment. For comparison, look at how the S&P 500 did
over the same period. With dividends reinvested, the same $10,000
investment would have grown to $38,358 - a 283.58% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Pressures from rising interest
rates contributed to below-average
returns in the U.S. stock market
during the 12 months ended
December 31, 1994. The
Standard and Poor's Composite
Index of 500 stocks finished the
12-month period with a total
return of 1.32% - well below its
historical annual average. After
steady gains in January, stocks
stumbled from February through
June 1994. During that time, the
Federal Reserve Board raised
short-term interest rates four
times in an effort to curb
possible future inflation triggered
by a strengthening economy.
During the second half of 1994,
there was a tug-of-war in the
stock market, fueled by two
competing sentiments. On one
side there was concern that rising
interest rates would hurt
corporate earnings; the market
dropped in November when the
Fed raised rates again. On the
other hand, strengthening
corporate earnings and a flurry
of merger and acquisition
activity helped the market rally
from July through October and in
December as well. Returns in
overseas markets were mixed.
The Morgan Stanley EAFE
(Europe, Australia, Far East)
index returned 7.78% for the 12
months ended December 31. The
Morgan Stanley Emerging
Markets Free index was down
7.32% during the same period, on
the heels of Mexico's devaluation
of the peso and market corrections
in Asian emerging markets.
An interview with Alan Leifer,
Portfolio Manager of Fidelity
Trend Fund
Q. HOW HAS THE FUND PERFORMED, ALAN?
A. The fund was down 6.70% for the year ended December 31, 1994. The
average growth fund was down 2.17% for the same time period, according to
Lipper Analytical Services. The fund hit its lowpoint in June when total
return was down 8.07% and has recovered moderately since then.
Q. WHAT HAPPENED?
A. Basically, just a normal correction in the market. This fund has been
around since 1958, and in that time we've seen 12 bull markets and 12 bear
markets come and go. What's happening now is that the stock market isn't
rewarding us for owning mid-cap companies with long-term growth prospects.
But, I still feel good about what the fund owns and am buying more of the
mid-cap stocks I really like. I'm also pleased that the Trend Fund wasn't
involved in Mexican securities, derivatives, government bonds and other
securities that received a lot of notoriety this year.
Q. ARE YOU FINDING GOOD BARGAINS
OUT THERE?
A. Yes. The Trend Fund's success in the past has been due, in part, to
staying fully invested, regardless of the short-term market outlook. I'm in
a position now of looking for opportunities in a market where people are
selling because of inflation fears without regard to the virtues of
individual companies.
Q. WHY DO YOU PREFER THE MID-CAP MARKET TO SMALL CAPS AND LARGER CAPS?
A. Well, it's interesting. Most of the action in the market so far this
decade - both up and down - has taken place in the mid-cap group. Mid-caps
provide the investor with almost as much potential performance over the
long-term as small-cap stocks, but often with far less volatility. Many
large-cap companies are having a tough time growing. Because they've done
well in 12 of the past 13 years, I don't think they'll appreciate as much
in the next bull market. Mid-cap growth stocks don't pay much in dividends
but retain their profits to grow the business - a practice that is
extremely valuable to investors over the long term.
Q. DID THE FUND EXPERIENCE ANY HIGH POINTS IN WHAT WAS A DOWN YEAR?
A. Many of the fund's healthcare stocks did well, and are an example of
profiting from taking a long-term view. In 1993, the Clinton administration
cast a good deal of uncertainty over the entire healthcare industry. While
the companies within the sector continued to grow, the stock prices were
beaten down. When that started happening, I began buying good quality
healthcare stocks. By the end of 1994, when the fears of negative
legislative effects had been lifted, the market began to treat healthcare
stocks as growth stocks again and the fund realized some gains. Also, the
proposed mergers and acquisitions that got started during the second half
of the year were positive for the fund's total return. Caesar's World did
well when a proposed buy-out by ITT-Sheraton was announced, and Intuit -
which was a holding during the first half of the year - went up after being
targeted by Microsoft. I try to buy the most important companies in each
industry whether or not the stock is performing well. This way, there's
always a chance that if the stock market doesn't pay you for value, someone
else will. Both Caesar's World and Intuit were holdings of the fund that
were important to their industries, and undervalued in the marketplace.
Q. WHAT INVESTMENTS DIDN'T WORK OUT AS YOU'D HOPED?
A. Some housing stocks the fund owns, such as Centex and Lennar, were down
significantly in 1994. As shareholders of the fund know, housing is one of
the long-term plays for the fund. After a terrific 1993, housing stocks
gave a lot back in 1994 because the stock market treated them as
interest-rate sensitive. Another disappointing area was energy,
particularly natural gas. Natural gas prices hit bottom in 1992, recovered
throughout 1993, but came down again in 1994. North American drillers -
specifically Rowan and Global Marine - were also down in 1994. In both
cases, however, we've looked at the depressed prices as
a buying opportunity.
Q. WHAT WILL YOUR STRATEGY BE AS YOU HEAD INTO 1995?
A. My strategy will remain the same, and I think I'll find a lot of
attractive investment opportunities. Over 1,500 companies went public
between 1990-1993, raising over $150 billion in capital. As the economy
slows, many of those companies are trading at 50% to 75% below what they
went public for, yet continue to grow and look healthy. As long as there
are good companies out there that are doing well and selling at good
prices, I'll remain optimistic about the long-term future of the market and
the Trend Fund.
FUND FACTS
GOAL: to increase the value
of the fund's shares over the
long term by investing in
stocks with growth potential
START DATE: June 16, 1958
SIZE: as of December 31,
1994, more than $1.1 billion
MANAGER: Alan Leifer, since
1987; manager, Fidelity
Contrafund, 1984-1987;
Fidelity Select Industrial
Materials, 1986-1988;
joined Fidelity in 1980
(checkmark)
ALAN LEIFER ON MID-CAP GROWTH
STOCKS:
"I prefer buying growth stocks
when they're out of favor.
That way, the fund can get
good prospects for long-term
growth without paying
astronomical prices.
Generally, I like to target a
mid-cap company - about $1
billion in market capitalization
- - that trades for about 15
times last year's earnings and
is forecasted by our analysts
to grow at a rate of 15% per
year or more. With a few
years of growth under its belt,
a company such as I've
described looks very
promising and is less likely to
fail. In the past couple of
months I've been buying
Centex, Rogers
Communications and Fleet
Financial, stocks that I think
are a good value and are
poised for growth over the
next
few years."
(solid bullet) Of the fund's top five
industry holdings only Media
& Leisure was increased. The
remaining four decreased
slightly.
(solid bullet) In the past six months, the
fund's short-term investments
increased from 1.6% to 6.6%
of the fund.
INVESTMENT CHANGES
TOP TEN STOCKS AS OF DECEMBER 31, 1994
% OF FUND'S
% OF FUND'S INVESTMENTS
INVESTMENTS IN THESE STOCKS
6 MONTHS AGO
Telephone & Data Systems, Inc. 4.6 3.5
Golden West Financial Corp. 3.9 4.4
Federal National Mortgage 3.1 3.8
Assoication
Cellular Communications, Inc. Class P 2.4 2.2
Reynolds Metals Co. 2.1 2.1
Centex Corp. 2.0 2.3
Rogers Communications, Inc. Class B 1.8 1.9
Chiron Corp. 1.7 0.9
Tele-Communications, Inc. Class A 1.4 1.6
Viacom, Inc. (non-vtg.) 1.3 0.9
TOP FIVE INDUSTRIES AS OF DECEMBER 31, 1994
% OF FUND'S
% OF FUND'S INVESTMENTS
INVESTMENTS IN THESE INDUSTRIES
6 MONTHS AGO
Finance 13.3 14.4
Media & Leisure 11.1 9.7
Utilities 11.0 11.1
Health 8.7 9.8
Energy 8.5 10.6
ASSET ALLOCATION
AS OF DECEMBER 31, 1994* AS OF JUNE 30, 1994**
Row: 1, Col: 1, Value: 6.6
Row: 1, Col: 2, Value: 1.5
Row: 1, Col: 3, Value: 41.9
Row: 1, Col: 4, Value: 50.0
Row: 1, Col: 1, Value: 1.6
Row: 1, Col: 2, Value: 1.1
Row: 1, Col: 3, Value: 50.0
Row: 1, Col: 4, Value: 47.3
Stocks 91.9%
Bonds 1.5%
Short-term
Investments 6.6%
FOREIGN
INVESTMENTS 12.3%
Stocks 97.3%
Bonds 1.1%
Short-term
Investments 1.6%
FOREIGN
INVESTMENTS 10.3%
*
**
INVESTMENTS DECEMBER 31, 1994
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 91.5%
SHARES VALUE (NOTE 1)
(000S)
BASIC INDUSTRIES - 5.2%
CHEMICALS & PLASTICS - 0.4%
Great Lakes Chemical Corp. 76,400 $ 4,355
IRON & STEEL - 0.3%
Nucor Corp. 71,800 3,985
METALS & MINING - 4.5%
Aluminum Co. of America 98,000 8,489
Broken Hill Proprietary Co. Ltd. (The) 609,409 9,260
Noranda, Inc. 605,600 11,448
Reynolds Metals Co. 509,900 24,985
Sunshine Mining & Refining Co. (a) 340,000 552
54,734
PACKAGING & CONTAINERS - 0.0%
Owens-Illinois, Inc. (a) 12,500 138
TOTAL BASIC INDUSTRIES 63,212
CONGLOMERATES - 1.1%
Brascan Ltd. Class A 275,300 4,001
PEC Israel Economic Corp. (a) 311,900 8,889
12,890
CONSTRUCTION & REAL ESTATE - 6.8%
BUILDING MATERIALS - 0.6%
Lafarge Corp. 430,589 7,643
CONSTRUCTION - 5.1%
American Homestar Corp. (a) 20,000 195
Centex Corp. 1,064,200 24,211
Engle Homes, Inc. 41,500 314
Kaufman & Broad Home Corp. 442,500 5,697
Lennar Corp. 977,950 15,158
Oakwood Homes Corp. 243,000 5,923
Toll Brothers, Inc. (a) 652,500 6,443
Webb (Del E.) Corp. 210,200 3,705
61,646
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONSTRUCTION & REAL ESTATE - CONTINUED
REAL ESTATE - 0.1%
Hovnanian Enterprises, Inc.:
Class A (a) 155,850 $ 838
Class B (a) 114,250 571
Koll Real Estate Group, Inc. (a) 170,000 80
Major Realty Corp. (a) 40,000 80
1,569
REAL ESTATE INVESTMENT TRUSTS - 1.0%
Beacon Properties Corp. 320,100 6,082
Crown American Realty Trust (SBI) 36,000 486
Equity Residential Property Trust (SBI) 164,300 4,929
11,497
TOTAL CONSTRUCTION & REAL ESTATE 82,355
DURABLES - 3.4%
AUTOS, TIRES, & ACCESSORIES - 1.4%
Chrysler Corp. 164,600 8,065
Dana Corp. 134,600 3,146
Discount Auto Parts, Inc. (a) 174,200 3,288
Magna International, Inc. Class A 47,000 1,811
16,310
CONSUMER ELECTRONICS - 0.8%
Duracraft Corp. (a) 49,700 1,584
Whirlpool Corp. 162,900 8,267
9,851
HOME FURNISHINGS - 0.1%
Rhodes, Inc. (New) (a) 100,000 1,250
TEXTILES & APPAREL - 1.1%
Fruit of the Loom, Inc. Class A (a) 156,600 4,228
NIKE, Inc. Class B 41,200 3,075
Reebok International Ltd. 50,300 1,987
Unifi, Inc. 182,200 4,646
13,936
TOTAL DURABLES 41,347
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
ENERGY - 8.0%
ENERGY SERVICES - 3.8%
Global Marine, Inc. (a) 3,478,700 $ 12,610
Lone Star Technologies, Inc. (a) 122,500 858
Oceaneering International, Inc. (a) 792,200 8,120
Offshore Logistics, Inc. (a) 272,600 3,544
Production Operators Corp. 168,600 4,089
Rowan Companies, Inc. (a) 1,389,100 8,508
Schlumberger Ltd. 130,500 6,574
Varco International, Inc. (a) 269,200 1,682
45,985
OIL & GAS - 4.2%
Amerada Hess Corp. 147,600 6,734
Apache Corp. 487,700 12,193
Cabot Oil & Gas Corp. Class A 376,400 5,458
Maxus Energy Corp. (a) 449,400 1,517
Mesa, Inc. (a) 626,900 3,056
Newfield Exploration Co. (a) 34,600 683
Noble Affiliates, Inc. 136,100 3,368
Renaissance Energy Ltd. (a) 629,100 12,172
Renaissance Energy Ltd. (a)(d) 54,000 1,045
Union Texas Petroleum Holdings, Inc. 216,100 4,484
50,710
TOTAL ENERGY 96,695
FINANCE - 13.3%
BANKS - 3.9%
Citicorp 167,679 6,938
Deutsche Bank AG 23,700 11,013
Fleet Financial Group, Inc. 461,647 15,004
Northern Trust Corp. 193,100 6,759
State Street Boston Corp. 246,700 7,060
46,774
CREDIT & OTHER FINANCE - 0.7%
MBNA Corp. 345,650 8,080
FEDERAL SPONSORED CREDIT - 3.0%
Federal National Mortgage Association 505,637 36,848
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - CONTINUED
INSURANCE - 0.6%
First Central Financial Corp.(c) 376,500 $ 2,636
Progressive Corp. (Ohio) 135,700 4,749
7,385
SAVINGS & LOANS - 3.9%
Golden West Financial Corp. 1,343,800 47,369
SECURITIES INDUSTRY - 1.2%
Salomon, Inc. 72,600 2,723
United Asset Management Corp. 308,200 11,364
14,087
TOTAL FINANCE 160,543
HEALTH - 8.1%
DRUGS & PHARMACEUTICALS - 4.5%
ALZA Corp. Class A (a) 636,700 11,461
Chiron Corp. (a) 260,400 20,930
Elan PLC:
ADR (a) 89,400 3,185
(1 Advanced Therapeutic Systems Common & 1 ADR
warrant) (a) 16,587 454
Pfizer, Inc. 51,400 3,971
Schering-Plough Corp. 135,200 10,005
Schering-Plough Corp. (equity unit) (a)(d) 3,800 112
Teva Pharmaceutical Industries Ltd. ADR 171,400 4,146
Therapeutic Discovery Corp. (1 Share Class A and 1 share
ALZA Corp. warrant) (a) 44,830 250
54,514
MEDICAL EQUIPMENT & SUPPLIES - 1.8%
Omnicare, Inc. 67,700 2,970
Owens and Minor, Inc. 361,450 5,151
Pall Corp. 362,300 6,793
SciMed Life Systems, Inc. (a) 104,300 5,267
Tokos Medical Corp. (a) 130,000 845
21,026
MEDICAL FACILITIES MANAGEMENT - 1.8%
Columbia Healthcare Corp. 3,298 120
Community Psychiatric Centers 145,700 1,603
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
MEDICAL FACILITIES MANAGEMENT - CONTINUED
Coram Healthcare Corp. (a) 50,000 $ 825
HEALTHSOUTH Rehabilitation Corp. (a) 52,750 1,952
U.S. Healthcare, Inc. 325,550 13,429
Vivra, Inc. (a) 150,600 4,217
22,146
TOTAL HEALTH 97,686
HOLDING COMPANIES - 0.5%
Brierley Investments Ltd. 7,639,211 5,526
Triton Group Ltd. (a) 1,824 3
Triton Group Ltd. (warrants) (a) 2,870 1
5,530
INDUSTRIAL MACHINERY & EQUIPMENT - 4.3%
ELECTRICAL EQUIPMENT - 3.0%
BBC Brown Boveri & Cie (Bearer) 13,075 11,257
Duracell International, Inc. 57,600 2,498
Itel Corp. (a) 259,800 8,996
Lifeline Systems, Inc. (a) (c) 280,800 1,580
Sensormatic Electronics Corp. 310,700 11,185
35,516
INDUSTRIAL MACHINERY & EQUIPMENT - 1.3%
Deere & Co. 49,000 3,246
Singer Company 361,500 10,800
Stewart & Stevenson Services, Inc. 56,800 1,960
16,006
POLLUTION CONTROL - 0.0%
AquaSciences International, Inc. (a) 250,000 -
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 51,522
MEDIA & LEISURE - 11.0%
BROADCASTING - 4.4%
International Cablecasting Technologies, Inc. (a) 384,200 961
International Cabletel, Inc. (a) 201,189 5,583
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - CONTINUED
BROADCASTING - CONTINUED
Jones Intercable, Inc. Class A (a) 366,200 $ 4,486
People's Choice TV Corp. (a) 170,100 2,679
Tele-Communications, Inc. Class A (a) 794,700 17,285
Television Broadcast Limited Ord. 575,000 2,296
Valuevision International, Inc. (a) 492,800 2,341
Viacom, Inc. (a) 24,640 1,026
Viacom, Inc. (rights) (a) 308,000 347
Viacom, Inc. (non-vtg.) (a) 401,194 16,297
53,301
ENTERTAINMENT - 0.6%
American Classic Voyager Co. 81,900 1,106
Carnival Cruise Lines, Inc. Class A 89,000 1,891
Cedar Fair LP 78,100 2,304
Players International, Inc. (a) 90,300 2,032
7,333
LODGING & GAMING - 4.6%
Autotote Corp. Class A (a) 340,600 3,874
Caesars World, Inc. (a) 147,700 9,859
Four Seasons Hotels, Inc. 272,777 3,162
Hospitality Franchise Systems, Inc. 451,800 11,973
La Quinta Motor Inns, Inc. 296,112 6,329
Mirage Resorts, Inc. (a) 275,850 5,655
National Gaming Corp. (a) 42,530 510
President Riverboat Casinos, Inc. (a) 503,200 4,466
Promus Companies, Inc. (a) 311,600 9,660
55,488
PUBLISHING - 0.6%
Scholastic Corp. (a) 92,000 4,692
Times Mirror Co., Series A 90,400 2,836
7,528
RESTAURANTS - 0.8%
Applebee's International, Inc. 89,400 1,196
Au Bon Pain, Inc. Class A (a) 307,600 4,922
IHOP Corp. (a) 140,000 3,814
9,932
TOTAL MEDIA & LEISURE 133,582
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONDURABLES - 1.6%
BEVERAGES - 0.4%
Guinness PLC Ord. 718,100 $ 5,062
HOUSEHOLD PRODUCTS - 0.8%
Colgate-Palmolive Co. 141,900 8,993
TOBACCO - 0.4%
Universal Corp. 242,700 4,824
TOTAL NONDURABLES 18,879
RETAIL & WHOLESALE - 7.3%
APPAREL STORES - 2.4%
Catherines Stores Corp. (a) 120,000 1,050
Filene's Basement Corp. (a) 321,400 1,486
Limited, Inc. (The) 363,100 6,581
Petrie Stores Corp. 337,600 7,554
TJX Companies, Inc. 808,200 12,629
29,300
GENERAL MERCHANDISE STORES - 1.3%
Broadway Stores, Inc. (a) 319,100 2,353
Mac Frugals Bargains C/O, Inc. (a) 150,800 3,016
Meyer (Fred), Inc. (a) 86,600 2,663
Wal-Mart Stores, Inc. 373,300 7,933
15,965
GROCERY STORES - 0.6%
Stop & Shop Companies, Inc. (a) 278,100 7,092
RETAIL & WHOLESALE, MISCELLANEOUS - 3.0%
Body Shop International PLC 2,398,300 7,176
CML Group, Inc. 305,050 3,089
Circuit City Stores, Inc. 282,100 6,277
Home Depot, Inc. (The) 135,300 6,224
Lowe's Companies, Inc. 80,500 2,797
Semi Tech Corp. 182,100 714
Sun Television & Appliances, Inc. 261,900 2,193
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
RETAIL & WHOLESALE, MISCELLANEOUS - CONTINUED
Viking Office Products, Inc. (a) 135,400 $ 4,147
Waban, Inc. (a) 210,800 3,741
36,358
TOTAL RETAIL & WHOLESALE 88,715
SERVICES - 1.2%
LEASING & RENTAL - 0.4%
National Auto Credit, Inc. (a) 415,400 4,985
SERVICES - 0.8%
Block (H & R), Inc. 151,900 5,639
Franklin Quest Co. (a) 45,200 1,350
National Education Corp. (a) 180,400 744
Supercuts, Inc. (a) 221,600 1,829
9,562
TOTAL SERVICES 14,547
TECHNOLOGY - 5.7%
COMPUTER SERVICES & SOFTWARE - 2.5%
CUC International, Inc. (a) 135,400 4,536
Cheyenne Software, Inc. (a) 181,100 2,400
ECI Telecom Ltd. (a) 706,400 9,625
Electronics for Imaging Inc. (a) 66,500 1,829
Microsoft Corp. (a) 78,300 4,786
Parametric Technology Corp. (a) 171,400 5,913
SunGard Data Systems, Inc. (a) 19,900 765
29,854
COMPUTERS & OFFICE EQUIPMENT - 0.3%
Danka Business Systems PLC sponsored ADR 180,600 3,905
XYVision, Inc. (a) 165,750 94
3,999
ELECTRONIC INSTRUMENTS - 0.7%
Kulicke & Soffa Industries, Inc. (a) 182,300 3,828
Teradyne, Inc. (a) 138,800 4,702
8,530
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
ELECTRONICS - 2.2%
Arrow Electronics, Inc. (a) 63,812 $ 2,289
Intel Corp. 212,200 13,554
Solectron Corp. (a) 85,800 2,360
Texas Instruments, Inc. 115,300 8,633
26,836
TOTAL TECHNOLOGY 69,219
TRANSPORTATION - 3.1%
AIR TRANSPORTATION - 1.4%
AMR Corp. (a) 171,400 9,127
Mesa Airlines, Inc. (a) 100,000 913
Pittston Minerals Group 37,600 959
Southwest Airlines Co. 309,400 5,182
16,181
RAILROADS - 1.1%
Canadian Pacific Ltd. Ord. 327,900 4,883
Conrail, Inc. 112,600 5,686
Johnstown America Industries, Inc. (a) 180,800 2,960
13,529
SHIPPING - 0.6%
Bergesen Group:
Class A 34,400 839
Class B 75,500 1,831
Overseas Shipholding Group, Inc. 201,000 4,623
7,293
TOTAL TRANSPORTATION 37,003
UTILITIES - 10.9%
CELLULAR - 6.0%
American Paging, Inc. (a) 373,700 2,756
Cellular Communications, Inc. Class P (a) 521,933 28,471
Cellular Communications Puerto Rico, Inc. (a) 49,035 1,643
Commnet Cellular, Inc. (a) 220,800 6,403
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - CONTINUED
CELLULAR - CONTINUED
Rogers Communications, Inc. Class B (a) 1,596,768 $ 21,356
Securicor Group A 499,600 7,865
United States Cellular Corp. (a) 110,400 3,617
72,111
ELECTRIC UTILITY - 0.3%
NIPSCO Industries, Inc. 137,400 4,088
TELEPHONE SERVICES - 4.6%
Telephone & Data Systems, Inc. 1,202,532 55,466
TOTAL UTILITIES 131,665
TOTAL COMMON STOCKS
(Cost $954,401) 1,105,390
PREFERRED CONVERTIBLE STOCKS - 0.4%
HEALTH - 0.3%
MEDICAL EQUIPMENT & SUPPLIES - 0.3%
U.S. Surgical Corp. $2.20 (d) 157,400 3,620
TRANSPORTATION - 0.1%
AIR TRANSPORTATION - 0.1%
Pittston Co. $3.125 (d) 22,000 946
TOTAL PREFERRED CONVERTIBLE STOCKS
(Cost $4,649) 4,566
CORPORATE BONDS - 1.5%
MOODY'S RATINGS PRINCIPAL
(UNAUDITED) AMOUNT (000S)
CONVERTIBLE BONDS - 0.8%
ENERGY - 0.1%
OIL & GAS - 0.1%
Apache Corp. 6%, 1/15/02 (d) -- $ 1,810 1,855
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (000S) (000S)
CONVERTIBLE BONDS - CONTINUED
HEALTH - 0.3%
DRUGS & PHARMACEUTICALS - 0.3%
ALZA Corp. liquid yield option notes
0% 7/14/14 Baa3 $ 3,000 $ 1,001
Chiron Corp. 1.90%, 11/17/00 (d) Ba3 1,150 840
Perseptive Biosystems 8 1/4%,
8/15/01 (d) -- 2,433 1,630
3,471
HOLDING COMPANIES - 0.2%
Leucadia National Corp. 5 1/4%,
2/1/03 Ba2 2,230 2,074
MEDIA & LEISURE - 0.1%
LODGING & GAMING - 0.1%
Hospitality Franchise Systems 4 1/2%,
10/1/99 Baa3 1,000 973
RETAIL & WHOLESALE - 0.0%
RETAIL & WHOLESALE, MISCELLANEOUS - 0.0%
CML Group, Inc. . 5 1/2%,
1/15/03 (d) -- 1,000 720
UTILITIES - 0.1%
CELLULAR - 0.1%
Rogers Communications, Inc. liquid yield
option notes 0%, 5/20/13 B2 2,590 848
TOTAL CONVERTIBLE BONDS 9,941
NONCONVERTIBLE BONDS - 0.7%
ENERGY - 0.4%
ENERGY SERVICES - 0.4%
Global Marine, Inc. 12 3/4%, 12/15/99 B1 5,000 5,350
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
RETAIL & WHOLESALE - 0.2%
RETAIL & WHOLESALE, MISCELLANEOUS - 0.2%
International Semi-Tech Microelectronics, Inc.
secured 0%, 8/15/03 (b) Ba2 $ 4,000 $ 1,760
TECHNOLOGY - 0.1%
COMPUTERS & OFFICE EQUIPMENT - 0.1%
XYVision, Inc. 15%, 6/30/95 -- 774 580
TOTAL NONCONVERTIBLE BONDS 7,690
TOTAL CORPORATE BONDS
(Cost $19,673) 17,631
REPURCHASE AGREEMENTS - 6.6%
MATURITY
AMOUNT
(000S)
Investments in repurchase agreements,
(U.S. Treasury obligations), in a
joint trading account at 5.77%,
dated 12/30/94 due 1/3/95 $ 80,257 80,206
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,058,929) $ 1,207,793
LEGEND
(a) Non-income producing
(b) Debt obligation initially issued in zero coupon form which converts to
coupon form at a specified rate and date.
(c) Affiliated company (see Note 5 of Notes
to Financial Statements).
(d) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $10,768,000 or 0.9% of net
assets.
OTHER INFORMATION
Distribution of investments by country of issue, as a percentage of total
value of investment in securities, is as follows:
United States 87.7%
Canada 5.3
United Kingdom 2.0
Israel 1.2
Others (individually less than 1%) 3.8
TOTAL 100.0%
INCOME TAX INFORMATION
At December 31, 1994, the aggregate cost of investment securities for
income tax purposes was $1,059,767,000. Net unrealized appreciation
aggregated $148,026,000, of which $249,132,000 related to appreciated
investment securities and $101,106,000 related to depreciated investment
securities.
The fund hereby designates $63,695,000 as a capital gain dividend for the
purpose of the dividend paid deduciton.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER SHARE AMOUNTS) DECEMBER 31, 1994
ASSETS
Investment in securities, at value (including repurchase $ 1,207,793
agreements of $80,206) (cost $1,058,929) -
See accompanying schedule
Receivable for investments sold 1,044
Receivable for fund shares sold 1,866
Dividends receivable 1,796
Interest receivable 357
Other receivables 679
TOTAL ASSETS 1,213,535
LIABILITIES
Payable for investments purchased $ 2,349
Payable for fund shares redeemed 9,392
Distributions payable 8,073
Accrued management fee 774
Other payables and accrued expenses 311
TOTAL LIABILITIES 20,899
NET ASSETS $ 1,192,636
Net Assets consist of:
Paid in capital $ 1,043,862
Undistributed net investment income 38
Accumulated undistributed net realized gain (loss) on (129)
investments and foreign currency transactions
Net unrealized appreciation (depreciation) on 148,865
investments and assets and liabilities in foreign
currencies
NET ASSETS, for 23,391 shares outstanding $ 1,192,636
NET ASSET VALUE, offering price and redemption price per $50.99
share ($1,192,636 (divided by) 23,391 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED DECEMBER 31, 1994
INVESTMENT INCOME $ 15,672
Dividends (including $40 received from affiliated issuers)
Interest 2,582
TOTAL INCOME 18,254
EXPENSES
Management fee $ 7,927
Basic fee
Performance adjustment 2,182
Transfer agent fees 2,415
Accounting fees and expenses 537
Non-interested trustees' compensation 7
Custodian fees and expenses 87
Registration fees 54
Audit 61
Legal 10
Interest 7
Reports to shareholders 2
Miscellaneous 12
Total expenses before reductions 13,301
Expense reductions (68) 13,233
NET INVESTMENT INCOME 5,021
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 81,664
Foreign currency transactions 35 81,699
Change in net unrealized appreciation (depreciation) on:
Investment securities (175,646)
Assets and liabilities in foreign currencies 1 (175,645)
NET GAIN (LOSS) (93,946)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ (88,925)
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 5,021 $ 5,519
Net investment income
Net realized gain (loss) 81,699 149,580
Change in net unrealized appreciation (depreciation) (175,645) 67,567
NET INCREASE (DECREASE) IN NET ASSETS RESULTING (88,925) 222,666
FROM OPERATIONS
Distributions to shareholders (4,492) (5,588)
From net investment income
In excess of net investment income - (294)
From net realized gain (82,775) (110,237)
TOTAL DISTRIBUTIONS (87,267) (116,119)
Share transactions 492,497 934,377
Net proceeds from sales of shares
Reinvestment of distributions 79,196 105,797
Cost of shares redeemed (596,061) (868,788)
Net increase (decrease) in net assets resulting from (24,368) 171,386
share transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS (200,560) 277,933
NET ASSETS
Beginning of period 1,393,196 1,115,263
End of period (including undistributed net investment $ 1,192,636 $ 1,393,196
income of $38 and $215, respectively)
OTHER INFORMATION
Shares
Sold 8,624 16,037
Issued in reinvestment of distributions 1,585 1,843
Redeemed (10,398) (14,878)
Net increase (decrease) (189) 3,002
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED DECEMBER 31,
1994 1993 1992 C 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning $ 59.08 $ 54.20 $ 49.63 $ 38.25 $ 44.22
of period
Income from Investment
Operations
Net investment income .20 .17 .58 A .66 .61
Net realized and (4.24) 10.04 7.66 12.99 (6.20)
unrealized gain (loss)
Total from investment (4.04) 10.21 8.24 13.65 (5.59)
operations
Less Distributions (.21) (.26) (.44) (.48) (.24)
From net investment
income
In excess of net - (.01) - - -
investment income
From net realized gain (3.84) (5.06) (3.23) (1.79) (.14)
Total distributions (4.05) (5.33) (3.67) (2.27) (.38)
Net asset value, end $ 50.99 $ 59.08 $ 54.20 $ 49.63 $ 38.25
of period
TOTAL RETURN B (6.70) 19.15% 16.77% 36.28% (12.66)
% %
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 1,193 $ 1,393 $ 1,115 $ 892 $ 702
(in millions)
Ratio of expenses to 1.04% .92% .56% .53% .61%
average net assets
Ratio of expenses to 1.04% .93% .56% .53% .61%
average net assets
before expense
reductions
Ratio of net investment .39% .43% 1.14% 1.43% 1.51%
income to average net
assets
Portfolio turnover rate 29% 50% 47% 57% 48%
</TABLE>
A INVESTMENT INCOME AND EXPENSES PER SHARE HAVE BEEN CALCULATED BASED ON
AVERAGE SHARES OUTSTANDING.
B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN. SEE NOTE 7 OF NOTES TO FINANCIAL
STATEMENTS.
C AS OF JANUARY 1, 1992, THE FUND DISCONTINUED THE USE OF EQUALIZATION
ACCOUNTING.
NOTES TO FINANCIAL STATEMENTS
For the period ended December 31, 1994
1. SIGNIFICANT ACCOUNTING
POLICIES.
Fidelity Trend Fund (the fund) is registered under the Investment Company
Act of 1940, as amended (the 1940 Act), as an open-end management
investment company organized as a Massachusetts business trust and is
authorized to issue an unlimited number of shares. The following summarizes
the significant accounting policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are readily
available are valued at the last sale price, or if no sale price, at the
closing bid price. Securities for which exchange quotations are not readily
available (and in certain cases debt securities which trade on an
exchange), are valued primarily using dealer-supplied valuations or at
their fair value as determined in good faith under consistently applied
procedures under the general supervision of the Board of Trustees.
Short-term securities maturing within sixty days of their purchase date are
valued at amortized cost or original cost plus accrued interest, both of
which approximate current value.
FOREIGN CURRENCY TRANSLATION.
The accounting records of the fund are maintained in U.S. dollars.
Investment securities and other assets and liabilities denominated in a
foreign currency are translated into U.S. dollars at the prevailing rates
of exchange at period end. Purchases and sales of securities, income
receipts, and expense payments are translated into U.S. dollars at the
prevailing exchange rate on the respective dates of the transactions.
Effective January 1, 1994, the fund adopted Statement of Position (SOP)
93-4: Foreign Currency Accounting and Financial Statement Presentation for
Investment Companies. In accordance with this SOP, reported net realized
gains and losses on foreign currency transactions represent currency gains
and losses realized between the trade and settlement dates on securities
transactions and the difference between the amount of net investment income
accrued and the U.S. dollar amount actually received. Further, as permitted
under the SOP, the effects of changes in foreign currency exchange rates on
investments in securities are not segregated in the Statement of Operations
from the effects of changes in market prices of those securities, but are
included with the net realized and unrealized gain or loss on investment
securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. Interest income, which includes accretion
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
of original issue discount, is accrued as earned. Investment income is
recorded net of foreign taxes withheld where recovery of such taxes is
uncertain.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
foreign currency transactions, partnerships, non-taxable dividends and
losses deferred due to wash sales. The fund also utilized earnings and
profits distributed to shareholders on redemption of shares as a part of
the dividends paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect net investment income per share. Accumulated undistributed net
investment income may include temporary book and tax basis differences
which will reverse in a subsequent period. Any taxable income or gain
remaining at fiscal year end is distributed in the following year.
2. OPERATING POLICIES.
FORWARD FOREIGN CURRENCY CONTRACTS. The fund may use foreign currency
contracts to facilitate transactions in foreign securities and to manage
the fund's currency exposure. Contracts to buy generally are used to
acquire exposure to foreign currencies, while contracts to sell are used to
hedge the fund's investments against currency fluctuations. Also, a
contract to buy or sell can offset a previous contract. Losses may arise
from changes in the value of the foreign currency or if the counterparties
do not perform under the contracts' terms.
The U.S. dollar value of forward foreign currency contracts is determined
using forward currency exchange rates supplied by a quotation service.
Purchases and sales of forward foreign currency contracts having the same
settlement date and broker are offset and any realized gain (loss) is
recognized on the date of offset; otherwise, gain (loss) is recognized on
settlement date.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The fund's investment
adviser, Fidelity Management & Research Company (FMR), is responsible for
determining that the value of these underlying securities remains at least
equal to the resale price.
2. OPERATING POLICIES -
CONTINUED
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of FMR, may transfer uninvested cash balances into one or more
joint trading accounts. These balances are invested in one or more
repurchase agreements that mature in 60 days or less from the date of
purchase, and are collateralized by U.S. Treasury or Federal Agency
obligations.
3. PURCHASES AND SALES
OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $350,836,000 and $520,603,000, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
basic fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR. The
rates ranged from .2850% to .5200% for the period January 1, 1994 to July
31, 1994 and .2700% to .5200% for the period August 1, 1994 to December 31,
1994.
In the event that these rates were lower than the contractual rates in
effect during those periods, FMR voluntarily implemented the above rates,
as they resulted in the same or a lower management fee. The annual
individual fund fee rate is .30%. The basic fee is subject to a performance
adjustment (up to a maximum of (plus/minus) .20%) based on the fund's
investment performance as compared to the appropriate index over a
specified period of time. For the period, the management fee was equivalent
to an annual rate of .79% of average net assets after the performance
adjustment.
TRANSFER AGENT FEES. Fidelity Service Co. (FSC), an affiliate of FMR, is
the fund's transfer, dividend disbursing and shareholder servicing agent.
FSC receives fees based on the type, size, number of accounts and the
number of transactions made by shareholders. FSC pays for typesetting,
printing and mailing of all shareholder reports, except proxy statements.
ACCOUNTING FEES. FSC maintains the fund's accounting records. The fee is
based on the level of average net assets for the month plus out-of-pocket
expenses.
BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid to these affiliated firms were $271,000 for the period.
5. TRANSACTIONS WITH
AFFILIATED COMPANIES.
An affiliated company is a company in which the fund has ownership of at
least 5% of the voting securities. Transactions with companies which are or
were affiliates are as follows:
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES
AMOUNTS IN THOUSANDS PURCHASE SALES DIVIDEND MARKET
AFFILIATE COST COST INCOME VALUE
First Central Financial Corp. $ - $ - $ 40 $ 2,636
Lifeline Systems, Inc.(a) - - - 1,580
TOTALS $ - $ - $ 40 $ 4,216
(a) Non-income producing
6. BANK BORROWINGS.
The fund is permitted to have bank borrowings for temporary or emergency
purposes to fund shareholder redemptions. The fund has established
borrowing arrangements with certain banks. Under the most restrictive
arrangement, the fund must pledge to the bank securities having a market
value in excess of 220% of the total bank borrowings. The interest rate on
the borrowings is the bank's base rate, as revised from time to time. The
maximum loan and the average daily loan balances during the periods for
which loans were outstanding amounted to $5,961,000 and $2,894,000,
respectively. The weighted average interest rate was 4.40%. Interest
expense includes $7,000 paid under the bank borrowing program.
7. EXPENSE REDUCTIONS.
FMR has directed certain portfolio trades to brokers who paid a portion of
the fund's expenses. For the period, the fund's expenses were reduced by
$68,000 under this arrangement.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders
of Fidelity Trend Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Trend Fund, including the schedule of portfolio investments, as of
December 31, 1994, and the related statement of operations for the year
then ended, the statement of changes in net assets for each of the two
years in the period then ended and the financial highlights for each of the
five years in the period then ended. These financial statements and
financial highlights are the responsibility of the fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of December 31, 1994 by correspondence with the
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evalu-
ating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Trend Fund as of December 31,1994, the results of its
operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for
each of the five years in the period then ended, in conformity with
generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
February 3, 1995
INVESTMENT ADVISER
Fidelity Management & Research
Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc. London, England
Fidelity Management & Research
(Far East) Inc. Tokyo, Japan
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Alan Leifer, Vice President
Arthur S. Loring, Secretary
Gary L. French, Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Robert H. Morrison, Manager,
Security Transactions
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox*
Phyllis Burke Davis*
Richard J. Flynn*
Edward C. Johnson 3d
E. Bradley Jones*
Donald J. Kirk*
Peter S. Lynch
Edward H. Malone*
Marvin L. Mann*
Gerald C. McDonough*
Thomas R. Williams*
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co.
Boston, MA
CUSTODIAN
The Chase Manhattan Bank, N.A.
New York, NY
FIDELITY GROWTH FUNDS
Blue Chip Growth Fund
Capital Appreciation Fund
Contrafund
Disciplined Equity Fund
Dividend Growth Fund
Emerging Growth Fund
Fidelity Fifty
Growth Company Fund
Low-Priced Stock Fund
Magellan(registered trademark) Fund
Mid-Cap Stock Fund
New Millennium(trademark) Fund
OTC Portfolio
Retirement Growth Fund
Small Cap Growth Fund
Stock Selector
Trend Fund
Value Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
