FIDELITY CHARLES STREET TRUST, 485BPOS, 1997-02-13

FIDELITY CHARLES STREET TRUST
485BPOS, 1997-02-13

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT (No. 2-73133)
UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 61 [X]
and
REGISTRATION STATEMENT (No. 811-3221)
UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 61 [X]
Fidelity Charles Street Trust
(Exact Name of Registrant as Specified in Charter)
82 Devonshire St., Boston, Massachusetts 02109
(Address Of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number: 617-570-7000
Arthur S. Loring, 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 February 17, 1997 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.
Registrant has filed a declaration pursuant to Rule 24f-2 under the
Investment Company Act of 1940 and filed the Notice required by such Rule
on November 25, 1996.
FIDELITY CHARLES STREET TRUST:
FIDELITY ASSET MANAGER: INCOME

CROSS REFERENCE SHEET
FORM N-1A

ITEM NUMBER PROSPECTUS SECTION

<TABLE>
<CAPTION>
<S> <C> <C> <C>
1 .............................. Cover Page

2 a .............................. Expenses

b, c .............................. Contents; The Fund at a Glance; Who May Want
to Invest

3 a .............................. Financial Highlights

b .............................. *

c .............................. Performance

d .............................. Performance

4 a i............................. Charter

ii........................... The Fund at a Glance; Investment Principles and
Risks, Securities and Investment Practices

b .............................. Investment Principles and Risks, Securities and
Investment Practices

c .............................. Who May Want to Invest; Investment Principles
and Risks, Securities and Investment Practices

5 a .............................. Charter

b i............................. Cover Page; The Fund at a Glance; Charter; Doing
Business with Fidelity, FMR and Its Affiliates

ii........................... Charter, FMR and Its Affiliates

iii.......................... Expenses, Breakdown of Expenses

c .............................. Charter

d .............................. Charter; Breakdown of Expenses

e .............................. Cover Page; Charter

f .............................. Expenses

g i............................. Charter
.

ii............................ *
..

5A .............................. Performance

6 a i............................. Charter

ii........................... How to Buy Shares; How to Sell Shares;
Transaction Details; Exchange Restrictions

iii.......................... Charter

b ............................. Charter, FMR and Its Affiliates

c .............................. Transactions Details; Exchange Restrictions

d .............................. *

e .............................. Cover Page, Doing Business with Fidelity; How to
Buy Shares; How to Sell Shares; Investor Services

f, g .............................. Dividends, Capital Gains, and Taxes

7 a .............................. Cover Page; Charter

b .............................. Expenses; How to Buy Shares; Transaction Details

c .............................. *

d .............................. How to Buy Shares

e .............................. *

f .............................. Expenses, Breakdown of Expenses

8 .............................. How to Sell Shares; Investor Services; Transaction
Details; Exchange Restrictions

9 .............................. *

</TABLE>

* Not Applicable

Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how the fund
invests and the services available to shareholders.
To learn more about the fund and its investments, you can obtain a copy of
the fund's most recent financial report and portfolio listing, or a copy of
the Statement of Additional Information (SAI) dated February 17, 1997. The
SAI has been filed with the Securities and Exchange Commission (SEC) and is
available along with other related materials on the SEC's Internet Web site
(http://www.sec.gov). The SAI is incorporated herein by reference (legally
forms a part of the prospectus). For a free copy of either document, call
Fidelity at 1-800-544-8888.
Mutual fund shares are not deposits or obligations of, or guaranteed by,
any depository institution. Shares are not insured by the FDIC, Federal
Reserve Board, or any other agency, and are subject to investment risks,
including possible loss of principal amount invested.

LIKE ALL MUTUAL
FUNDS, THESE
SECURITIES HAVE NOT
BEEN APPROVED OR
DISAPPROVED BY THE
SECURITIES AND
EXCHANGE
COMMISSION OR ANY
STATE SECURITIES
COMMISSION, NOR HAS
THE SECURITIES AND
EXCHANGE
COMMISSION OR ANY
STATE SECURITIES
COMMISSION PASSED
UPON THE ACCURACY
OR ADEQUACY OF THIS
PROSPECTUS. ANY
REPRESENTATION TO
THE CONTRARY IS A
CRIMINAL OFFENSE.
AMI-pro -1196-01
(fund number 328, trading symbol FASIX)
This asset allocation fund seeks high current income through investments in
stocks, bonds and short-term and money market instruments of all types. The
fund also considers the potential for capital appreciation.
FIDELITY
ASSET
MANAGER:
INCOME
PROSPECTUS
FEBRUARY 17, 1997(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON, MA
02109
CONTENTS

KEY FACTS THE FUND AT A GLANCE

WHO MAY WANT TO INVEST

EXPENSES The fund's yearly
operating expenses.

FINANCIAL HIGHLIGHTS A summary
of the fund's financial data.

PERFORMANCE How the fund has
done over time.

THE FUND IN DETAIL CHARTER How the fund is
organized.

INVESTMENT PRINCIPLES AND RISKS
The fund's overall approach to
investing.

BREAKDOWN OF EXPENSES How
operating costs are calculated and
what they include.

YOUR ACCOUNT DOING BUSINESS WITH FIDELITY

TYPES OF ACCOUNTS Different
ways to set up your account,
including tax-sheltered retirement
plans.

HOW TO BUY SHARES Opening an
account and making additional
investments.

HOW TO SELL SHARES Taking money
out and closing your account.

INVESTOR SERVICES Services to
help you manage your account.

SHAREHOLDER AND DIVIDENDS, CAPITAL GAINS,
ACCOUNT POLICIES AND TAXES

TRANSACTION DETAILS Share price
calculations and the timing of
purchases and redemptions.

EXCHANGE RESTRICTIONS

KEY FACTS

THE FUND AT A GLANCE
GOAL: High current income, and capital appreciation when appropriate. As
with any mutual fund, there is no assurance that the fund will achieve its
goal.
STRATEGY: The fund diversifies across stocks, bonds and short-term and
money market instruments, both here and abroad, to pursue its goal. The
fund has a neutral mix which represents the way the fund's investments will
generally be allocated over the long term. This mix will vary over
short-term periods as fund management gradually adjusts the fund's holdings
- - within defined ranges - based on the current outlook for the different
markets.
Neutral Mix
Stocks 20%
(can range
from
10-30%)
Row: 1, Col: 1, Value: 30.0
Row: 1, Col: 2, Value: 20.0
Row: 1, Col: 3, Value: 50.0
Bonds 50%
(can range
from
40-60%)
Short-Term/M
oney Market
30%
(can range
from
10-50%)
MANAGEMENT: Fidelity Management & Research Company (FMR) is the management
arm of Fidelity Investments, which was established in 1946 and is now
America's largest mutual fund manager. Foreign affiliates of FMR may help
choose investments for the fund.
SIZE: As of September 30, 1996, the fund had over $566 million in assets.
WHO MAY WANT TO INVEST
The fund may be appropriate for investors who want to diversify among
domestic and foreign stocks, bonds, short-term and money market
instruments, and other types of securities in one fund. If you are looking
for a fund that can invest in a wide range of security types within defined
ranges in pursuit of current income, this fund may be appropriate for you.
Because the fund owns different types of investments, its performance is
affected by a variety of factors. The value of the fund's investments and
the income they generate will vary from day to day, and generally reflect
interest rates, market conditions, and other company, political, and
economic news. Performance also depends on FMR's skill in allocating
assets. When you sell your fund shares, they may be worth more or less than
what you paid for them.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or
sell shares of a fund. In addition, you may be charged an annual account
maintenance fee if your account balance falls below $2,500. See
"Transaction Details" page , for an explanation of how and when these
charges apply.
Maximum sales charge on purchases None
and reinvested distributions

Deferred sales charge on redemptions None

Exchange fee None

Annual account maintenance fee $12.0
(for accounts under $2,500) 0

ANNUAL FUND OPERATING EXPENSES are paid out of the fund's assets. The fund
pays a management fee to FMR. It also incurs other expenses for
servicessuch as maintaining shareholder records and furnishing shareholder
statements and financial reports. The fund's expenses are factored into its
share price or dividends and are not charged directly to shareholder
accounts (see page ).
The following figures are based on historical expenses, adjusted to reflect
current fees, and are calculated as a percentage of average net assets. A
portion of the brokerage commissions that the fund pays is used to reduce
fund expenses. In addition, the fund has entered into arrangements with its
custodian and transfer agent whereby interest earned on uninvested cash
balances is used to reduce custodian and transfer agent expenses. Including
these reductions, the total operating expenses presented in the table would
have been .76 %.
Management fee .45
%*

12b-1 fee Non
e

Other expenses .33
%

Total fund operating expenses .78
%

* EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
.35% TO .30%. IF THIS AGREEMENT WERE NOT IN EFFECT, THE MANAGEMENT FEE AND
TOTAL OPERATING EXPENSES WOULD HAVE BEE N .50% AND .83 %,
RESPECTIVELY.
EXAMPLES: Let's say, hypothetically, that the fund's annual return is 5%
and that its operating expenses are exactly as just described. For every
$1,000 you invested, here's how much you would pay in total expenses if you
close your account after the number of years indicated:
After 1 year $8

After 3 years $25

After 5 years $43

After 10 years $97

These examples illustrate the effect of expenses, but are not meant to
suggest actual or expected costs or returns, all of which may vary.

UNDERSTANDING
EXPENSES
Operating a mutual fund
involves a variety of
expenses for portfolio
management, shareholder
statements, tax reporting, and
other services. These costs
are paid from the fund's
assets; their effect is already
factored into any quoted
share price or return.
(checkmark)
FINANCIAL HIGHLIGHTS
The financial highlights table that follows has been audited by
Price Waterhouse LLP , independent accountants. The fund's
financial highlights, financial statements and report of the auditor are
included in the fund's Annual Report , and are
incorporated by reference into (are legally a part of) the fund's SAI.
Contact Fidelity for a free copy of the Annual Report or the SAI.
SELECTED PER-SHARE DATA

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1.Years ended September 30 1996 1995 1994C 1993B

2.Net asset value, beginning of period $ 11.46 $ 10.69 $ 11.07 $ 10.00

3.Income from Investment Operations

4. Net investment income .61 .56 .45 .46

5. Net realized and unrealized gain (loss) .20 .68 (.29) 1.04

6. Total from investment operations .81 1.24 .16 1.50

7.Less Distributions

8. From net investment income (.64) (.47) (.47) (.43)

9. From net realized gain -- -- (.04) --

10. In excess of net realized gain -- -- (.03) --

11. Total distributions (.64) (.47) (.54) (.43)

12.Net asset value, end of period $ 11.63 $ 11.46 $ 10.69 $ 11.07

13.Total return A 7.28% 11.99% 1.46% 15.32%

14.RATIOS AND SUPPLEMENTAL DATA

15.Net assets, end of period (000 omitted) $ 566,10 $ 566,07 $ 501,34 $ 199,23
4 9 9 7

16.Ratio of expenses to average net assets .82% .79% .71% .65%
D D

17.Ratio of expenses to average net assets .80% .79% .71% .65%
after expense reductions E

18.Ratio of net investment income to average 5.03% 5.15% 4.92% 5.19%
net assets

19.Portfolio turnover rate 148% 157% 83% 47%

20.Average commission rate F $ .0286

</TABLE>

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
B FROM OCTOBER 1, 1992 (COMMENCEMENT OF OPERATIONS) TO SEPTEMBER 30, 1993
C EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
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 FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
PERFORMANCE
Mutual fund performance is commonly measured as TOTAL RETURN. The total
returns that follow are based on historical fund results and do not reflect
the effect of taxes.
The fund's fiscal year runs from October 1 through September 30. The tables
below show the fund's performance over past fiscal years compared to
different measures, including a comparative index and a competitive funds
average. The chart on page presents calendar year performance.
AVERAGE ANNUAL TOTAL RETURNS
Fiscal periods ended Past Life
September 30, 1996 1 of
year fund
A

Asset Manager: Income 7.28 8.88
% %

Lehman Bros. Aggregate Bond Index 4.90 6.23
% %

Lipper Income Funds Average 10.90 n/a
%

CUMULATIVE TOTAL RETURNS
Fiscal periods ended Past Life
September 30, 1996 1 of
year fund
A

Asset Manager: Income 7.28% 40.55
%

Lehman Bros. Aggregate Bond Index 4.90% 27.34
%

Lipper Income Funds Average 10.90 n/a
%

A FROM OCTOBER 1, 1992 (COMMENCEMENT OF OPERATIONS)
UNDERSTANDING
PERFORMANCE
As economic conditions
change, different types of
investments do better than
others. While Asset Manager:
Income usually invests
in stocks, bonds and
short-term and money market
instruments, its emphasis is in
bonds and short-term and
money market instruments.
The fund's performance tends
to be related to changes in
short-term interest rates, but
will also reflect the
performance of the other
investments in its mix during
the time period.
(checkmark)
EXAMPLE: Let's say, hypothetically, that you put $10,000 in the fund on
October 1, 1992. From that date through September 30, 1996, the fund's
total return was 40.55%. Your $10,000 would have grown to $14,055 (the
initial investment plus 40.55% o f $10,000).
$10,000 OVER LIFE OF FUND
Fiscal years 1992 1994 1996
Row: 1, Col: 1, Value: 10000.0
Row: 2, Col: 1, Value: 9890.0
Row: 3, Col: 1, Value: 10020.3
Row: 4, Col: 1, Value: 10222.02
Row: 5, Col: 1, Value: 10485.16
Row: 6, Col: 1, Value: 10657.39
Row: 7, Col: 1, Value: 10891.49
Row: 8, Col: 1, Value: 10973.54
Row: 9, Col: 1, Value: 11035.05
Row: 10, Col: 1, Value: 11158.52
Row: 11, Col: 1, Value: 11251.64
Row: 12, Col: 1, Value: 11500.56
Row: 13, Col: 1, Value: 11531.81
Row: 14, Col: 1, Value: 11688.44
Row: 15, Col: 1, Value: 11615.38
Row: 16, Col: 1, Value: 11794.96
Row: 17, Col: 1, Value: 11997.58
Row: 18, Col: 1, Value: 11783.98
Row: 19, Col: 1, Value: 11558.83
Row: 20, Col: 1, Value: 11569.5
Row: 21, Col: 1, Value: 11602.06
Row: 22, Col: 1, Value: 11536.9
Row: 23, Col: 1, Value: 11689.09
Row: 24, Col: 1, Value: 11809.1
Row: 25, Col: 1, Value: 11699.69
Row: 26, Col: 1, Value: 11732.89
Row: 27, Col: 1, Value: 11644.89
Row: 28, Col: 1, Value: 11634.28
Row: 29, Col: 1, Value: 11701.27
Row: 30, Col: 1, Value: 11913.79
Row: 31, Col: 1, Value: 12037.44
Row: 32, Col: 1, Value: 12194.96
Row: 33, Col: 1, Value: 12488.19
Row: 34, Col: 1, Value: 12612.6
Row: 35, Col: 1, Value: 12816.64
Row: 36, Col: 1, Value: 12930.56
Row: 37, Col: 1, Value: 13101.93
Row: 38, Col: 1, Value: 13124.85
Row: 39, Col: 1, Value: 13355.23
Row: 40, Col: 1, Value: 13575.82
Row: 41, Col: 1, Value: 13727.97
Row: 42, Col: 1, Value: 13634.06
Row: 43, Col: 1, Value: 13622.07
Row: 44, Col: 1, Value: 13633.74
Row: 45, Col: 1, Value: 13681.62
Row: 46, Col: 1, Value: 13788.98
Row: 47, Col: 1, Value: 13694.14
Row: 48, Col: 1, Value: 13729.26
Row: 49, Col: 1, Value: 14055.41
$
$14,055
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment over a given period,
assuming reinvestment of any dividends and capital gains. A CUMULATIVE
TOTAL RETURN reflects actual performance over a stated period of time. An
AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that, if
achieved annually, would have produced the same cumulative total return if
performance had been constant over the entire period. Average annual total
returns smooth out variations in performance; they are not the same as
actual year-by-year results.
YEAR-BY-YEAR TOTAL RETURNS
Calendar years 1993 1994 1995
ASSET MANAGER: INCOME 15.39% -1.36% 16.6
9%
Lehman Bros. Aggregate Bond Index 9.75
% -2.92% 18.47 %
Lipper Income Funds Average 12.17 % -2.9
2 % 21.66 %
Consumer Price Index 2.75% 2.67% 2.54
%
Percentage (%)
Row: 1, Col: 1, Value: 0.0
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: 15.39
Row: 9, Col: 1, Value: -1.36
Row: 10, Col: 1, Value: 16.69
(LARGE SOLID BOX) Asset
Manager:
Income
YIELD refers to the income generated by an investment in the fund over a
given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all stock and bond
funds. Because this differs from other accounting methods, the quoted yield
may not equal the income actually paid to shareholders.
THE LEHMAN BROTHERS AGGREGATE BOND INDEX is a market value weighted
performance benchmark for investment-grade fixed-rate debt issues,
including government, corporate, asset-backed, and mortgage-backed
securities, with maturities of at least one year.
Unlike the fund's returns, the total returns of the comparative index do
not include the effect of any brokerage commissions, transaction fees, or
other costs of investing.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government.
THE COMPETITIVE FUNDS AVERAGE is the Lipper Income Funds Average, which
currently reflects the performance of over 22 mutual funds with
similar investment objectives. This average, published by Lipper Analytical
Services, Inc., excludes the effect of sales charges.
Other illustrations of fund performance may show moving averages over
specified periods.
The fund's recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders. For
current performance or a free annual report, call 1-800-544-8888.
TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN
INDICATION OF FUTURE PERFORMANCE.
THE FUND IN DETAIL

CHARTER
ASSET MANAGER: INCOME IS A MUTUAL FUND: an investment that pools
shareholders' money and invests it toward a specified goal. The fund is a
diversified fund of Fidelity Charles Street Trust, an open-end management
investment company organized as a Massachusetts business trust on July 7,
1981.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the fund's activities,
review contractual arrangements with companies that provide services to the
fund, and review the fund's performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These meetings
may be called to elect or remove trustees, change fundamental policies,
approve a management contract, or for other purposes. Shareholders not
attending these meetings are encouraged to vote by proxy. Fidelity will
mail proxy materials in advance, including a voting card and information
about the proposals to be voted on. The number of votes you are entitled to
is based upon the dollar value of your investment.
FMR AND ITS AFFILIATES
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs. Fidelity Management & Research (U.K.) Inc.
(FMR U.K.), in London, England, and Fidelity Management & Research (Far
East) Inc. (FMR Far East), in Tokyo, Japan, assist FMR with foreign
investments.
Richard Habermann is vice president and lead manager of Asset Manager:
Income, which he has managed since March 1996. He also manages several
other Fidelity funds. Previously, Mr. Habermann was chief investment
officer for Fidelity International, Ltd., from 1991 to 1993, and division
head for international equities and director of international research,
from 1993 to 1996. Mr. Habermann joined Fidelity in 1968.
George Vanderheiden is vice president of Asset Manager: Income and
manager of its equity investments, which he has managed since March 1996.
He also manages several other Fidelity funds. Mr. Vanderheiden joined
Fidelity in 1971.
Charles Morrison is manager of Asset Manager: Income's
fixed-income investments, which he has managed since February
1997 . He also manages several other Fidelity funds. Mr. Morrison
joined Fidelity in 198 7 .
John Todd is vice president of Asset Manager: Income and manager of its
short-term and money market investments, which he has managed since
December 1996. He also manages several other Fidelity funds. Mr. Todd
joined Fidelity in 1981.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation (FDC) distributes and markets Fidelity's
funds and services. Fidelity Service Company, Inc . (FSC) performs
transfer agent servicing functions for the fund.
FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far
East. Members of the Edward C. Johnson 3d family are the predominant owners
of a class of shares of common stock representing approximately 49% of the
voting power of FMR Corp. Under the Investment Company Act of 1940 (the
1940 Act), control of a company is presumed where one individual or group
of individuals owns more than 25% of the voting stock of that company;
therefore, the Johnson family may be deemed under the 1940 Act to form a
controlling group with respect to FMR Corp.
A broker-dealer may use a portion of the commissions paid by the fund to
reduce the fund's custodian or transfer agent fees. FMR may use its
broker-dealer affiliates and other firms that sell fund shares to carry out
the fund's transactions, provided that the fund receives brokerage services
and commission rates comparable to those of other broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
THE FUND'S INVESTMENT APPROACH
The fund seeks a high level of current income by allocating its assets
among stocks, bonds, short-term and money market instruments, and other
instruments of U.S. and foreign issuers. The fund also considers the
potential for capital appreciation.
The fund allocates its assets among the following classes, or types, of
investments. The STOCK CLASS includes equity securities of all types. The
BOND CLASS includes all varieties of fixed-income securities maturing in
more than one year. The SHORT-TERM/MONEY MARKET CLASS includes all types of
short-term and money market instruments. FMR may use its judgment to place
a security in the most appropriate class based on its investment
characteristics. Fixed-income securities may be classified in the bond or
short-term/money market class according to interest rate sensitivity as
well as maturity. The fund may also make other investments that do not fall
within these classes.
FMR has the ability to allocate the fund's assets within specified ranges.
The fund's NEUTRAL MIX represents the benchmark for its combination of
investments in each asset class over time. FMR may change the neutral mix
from time to time. The range and approximate neutral mix for each asset
class are shown below.
Range Neutral mix
STOCK CLASS 10 -30% 20%
BOND CLASS 40 -60% 50%
SHORT-TERM/
MONEY MARKET CLASS 10 -50% 30%
Asset Manager: Income's approach focuses on bonds and short-term and money
market instruments for current income. However, its ability to invest a
portion of its assets in stocks offers the opportunity for capital
appreciation, and potentially more volatility, than other income-oriented
funds.
Since the fund is subject to the risks of each investment type, the fund
and its performance are affected by many factors. Stock values fluctuate in
response to the activities of individual companies and general market and
economic conditions. The value of bonds and short-term instruments
fluctuates based on changes in interest rates and in the credit quality of
the issuer. FMR may use various investment techniques to hedge a portion of
the fund's risks, but there is no guarantee that these strategies will work
as FMR intends. When you sell your shares, they may be worth more or less
than what you paid for them.
In pursuit of the fund's objective, FMR will not try to pinpoint the
precise moment when a major reallocation should be made. Instead, FMR
regularly reviews the fund's allocations and makes changes gradually to
favor investments that it believes will provide the most favorable outlook
for achieving the fund's objective. Under normal circumstances, a single
reallocation will not involve more than 10% of the fund's total assets.
Although FMR uses its expertise and resources in allocating assets, FMR's
decisions may not be advantageous to the fund.
FMR normally invests the fund's assets according to its investment
strategy. The fund also reserves the right to invest without limitation in
preferred stocks and investment-grade debt instruments for temporary,
defensive purposes.
The fund diversifies across investment types more than most mutual funds.
No one mutual fund, however, can provide an appropriate balanced investment
plan for all investors.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies FMR may employ in
pursuit of the fund's investment objective, and a summary of related risks.
Any restrictions listed supplement those discussed earlier in this section.
A complete listing of the fund's limitations and more detailed information
about the fund's investments are contained in the fund's SAI. Policies and
limitations are considered at the time of purchase; the sale of instruments
is not required in the event of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques
unless it believes that they are consistent with the fund's investment
objective and policies and that doing so will help the fund achieve its
goal. Fund holdings and recent investment strategies are detailed in the
fund's financial reports, which are sent to shareholders twice a year. For
a free SAI or financial report, call 1-800-544-8888.
EQUITY SECURITIES may include common stocks and warrants. Common stocks,
the most familiar type, represent an equity (ownership) interest in a
corporation. Although equity securities have a history of long-term growth
in value, their prices fluctuate based on changes in a company's financial
condition and on overall market and economic conditions. Smaller companies
are especially sensitive to these factors.
RESTRICTIONS: With respect to 75% of total assets, the fund may not
purchase more than 10% of the outstanding voting securities of a single
issuer.
DEBT SECURITIES. Bonds and other debt instruments are used by issuers to
borrow money from investors. The issuer generally pays the investor
a fixed , variable , or floating rate of interest, and must
repay the amount borrowed at maturity. Some debt securities, such as zero
coupon bonds, do not pay current interest, but are sold at a
discount from their face values. Debt securities have varying levels of
sensitivity to changes in interest rates and varying degrees of credit
quality. In general, bond prices rise when interest rates fall, and fall
when interest rates rise. Longer-term bonds and zero coupon
bonds are generally more sensitive to interest rate changes.
In addition, bond prices are also affected by the credit quality of the
issuer. Investment-grade debt securities are medium- and high-quality
securities. Some, however, may possess speculative characteristics, and may
be more sensitive to economic changes and to changes in the financial
condition of issuers. Lower-quality debt securities are sometimes called
"junk bonds."
RESTRICTIONS: Purchase of a debt security is consistent with the fund's
debt quality policy if it is rated at or above the stated level by Moody's
Investors Service, Standard & Poor's, Duff & Phelps Credit Rating Co., or
Fitch Investors Service, L.P., or is unrated but judged to be of equivalent
quality by FMR. The fund currently intends to limit its investment in
corporate and foreign government debt securities (other than convertible
debt securities) to those of Baa-quality and above. The fund currently
intends to limit its investments in lower than Baa-quality convertible debt
securities to 5% of its assets.
MONEY MARKET SECURITIES are high-quality, short-term instruments issued by
the U.S. Government, corporations, financial institutions, and other
entities. These securities may carry fixed, variable, or floating interest
rates.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and
securities issued by U.S. entities with substantial foreign operations may
involve additional risks and considerations. These include risks relating
to political or economic conditions in foreign countries, fluctuations in
foreign currencies, withholding or other taxes, operational risks,
increased regulatory burdens, and the potentially less stringent investor
protection and disclosure standards of foreign markets. 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. All of these factors can make foreign
investments, especially those in developing countries, more volatile than
U.S. investments.
ASSET-BACKED SECURITIES include interests in pools of the following:
purchase contracts, financing leases, or sales agreements entered into by
municipalities; lower-rated debt securities; or consumer loans. The value
of these securities may be significantly affected by changes in interest
rates, the market's perception of issuers, and the creditworthiness of the
parties involved. Certain asset-backed securities rely on continued
payments by a municipality, and may also be subject to prepayment risk.
MORTGAGE SECURITIES are interests in pools of commercial or residential
mortgages, and include complex instruments such as collateralized mortgage
obligations and stripped mortgage-backed securities. Mortgage securities
may be issued by the U.S. Government or by private entities. For example,
Ginnie Maes are interests in pools of mortgage loans insured or guaranteed
by a U.S. Government agency. Because mortgage securities pay both interest
and principal as their underlying mortgages are paid off, they are subject
to prepayment risk. This is especially true for stripped securities. Also,
the value of a mortgage security may be significantly affected by changes
in interest rates. Some mortgage securities may have a structure that makes
their reaction to interest rates and other factors difficult to predict,
making their value highly volatile.
STRIPPED SECURITIES are the separate income or principal components of a
debt security. The risks associated with stripped securities are similar to
those of other debt securities, although stripped securities may be more
volatile and the value of certain types of stripped securities may move in
the same direction as interest rates. U.S. Treasury securities that have
been stripped by a Federal Reserve Bank are obligations issued by the U.S.
Treasury.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a security
at one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices, interest
rates, currency exchange rates, commodity prices, or other factors that
affect security values. These techniques may involve derivative
transactions such as buying and selling options and futures contracts,
entering into currency exchange contracts or swap agreements, purchasing
indexed securities, and selling securities short.
FMR can use these practices to adjust the risk and return characteristics
of the fund's portfolio of investments. If FMR judges market conditions
incorrectly or employs a strategy that does not correlate well with the
fund's investments, these techniques could result in a loss, regardless of
whether the intent was to reduce risk or increase return. These techniques
may increase the volatility of the fund and may involve a small investment
of cash relative to the magnitude of the risk assumed. In addition, these
techniques could result in a loss if the counterparty to the transaction
does not perform as promised.
DIRECT DEBT. Loans and other direct debt instruments are interests in
amounts owed to another party by a company, government, or other borrower.
They have additional risks beyond conventional debt securities because they
may entail less legal protection for the fund, or there may be a
requirement that the fund supply additional cash to a borrower on demand.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by
FMR, under the supervision of the Board of Trustees, to be illiquid, which
means that they may be difficult to sell promptly at an acceptable price.
The sale of some illiquid securities, and some other securities, may be
subject to legal restrictions. Difficulty in selling securities may result
in a loss or may be costly to the fund.
RESTRICTIONS: The fund may not purchase a security if, as a result, more
than 10% of its assets would be invested in illiquid securities.
WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS are trading practices in
which payment and delivery for the securities take place at a future date.
The market value of a security could change during this period.
OTHER INSTRUMENTS may include securities of closed-end investment companies
and real estate-related instruments.
CASH MANAGEMENT. The fund may invest in money market securities, in
repurchase agreements, and in a money market fund available only to
funds and accounts managed by FMR or its affiliates, whose goal is to seek
a high level of current income while maintaining a stable $1.00 share
price. A major change in interest rates or a default on the money market
fund's investments could cause its share price to change.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry.
RESTRICTIONS: With respect to 75% of its total assets, the fund may not
purchase a security if, as a result, more than 5% would be invested in the
securities of any issuer. This limitation does not apply to U.S.
Government securities.
The fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government
securities.
BORROWING. The fund may borrow from banks or from other funds advised by
FMR, or through reverse repurchase agreements. If the fund borrows money,
its share price may be subject to greater fluctuation until the borrowing
is paid off. If the fund makes additional investments while borrowings are
outstanding, this may be considered a form of leverage.
RESTRICTIONS: The fund may borrow only for temporary or emergency purposes,
but not in an amount exceeding 331/3% of its total assets.
LENDING securities to broker-dealers and institutions, including Fidelity
Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a means of earning
income. This practice could result in a loss or a delay in recovering the
fund's securities. The fund may also lend money to other funds advised by
FMR.
RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of the fund's
total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
The fund seeks a high level of current income by allocating its assets
among stocks, bonds, short-term instruments and other investments.
With respect to 75% of its total assets, the fund may not purchase a
security if, as a result, more than 5% would be invested in the securities
of any issuer and may not purchase more than 10% of the outstanding voting
securities of a single issuer.
The fund may not invest more than 25% of its total assets in any one
industry.
The fund may borrow only for temporary or emergency purposes, but not in an
amount exceeding 33% of its total assets.
Loans, in the aggregate, may not exceed 33% of the fund's total assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily operations.
Expenses paid out of the fund's assets are reflected in its share price or
dividends; they are neither billed directly to shareholders nor deducted
from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to affiliates who provide
assistance with these services. The fund also pays OTHER EXPENSES, which
are explained on page .
FMR may, from time to time, agree to reimburse the fund for management fees
and other expenses above a specified limit. FMR retains the ability to be
repaid by the fund if expenses fall below the specified limit prior to the
end of the fiscal year. Reimbursement arrangements, which may be terminated
at any time without notice, can decrease the fund's expenses and boost its
performance.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fee is
calculated by adding a group fee rate to an individual fund fee rate, and
multiplying the result by the fund's average net assets.
The group fee rate is based on the average net assets of all the mutual
funds advised by FMR. This rate cannot rise above 37%, and it drops as
total assets under management increase.
For September 1996, the group fee rate was .1446%. The individual fund
fee rate is .30%. The total management fee rate for the fiscal year ended
September 1996 was .49%. Effective August 1, 1996, FMR voluntarily agreed
to reduce the fund's individual fund fee rate from .35% to .30%. If this
reduction were not in effect, the total management fee rate would have been
.50 % for the fiscal year ended September 1996.
FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These
sub-advisers provide FMR with investment research and advice on issuers
based outside the United States. Under the sub-advisory agreements, FMR
pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively,
of the costs of providing these services.
The sub-advisers may also provide investment management services. In
return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its
management fee rate with respect to the fund's investments that the
sub-adviser manages on a discretionary basis.
OTHER EXPENSES
While the management fee is a significant component of the fund's annual
operating costs, the fund has other expenses as well.
The fund contracts with FSC to perform many transaction and accounting
functions. These services include processing shareholder transactions,
valuing the fund's investments, and handling securities loans. In fiscal
year ended September 1996, the fund paid FSC fees equal to .30 % of
its average net assets.
The fund also pays other expenses, such as legal, audit, and custodian
fees; proxy solicitation costs; and the compensation of trustees who are
not affiliated with Fidelity. A broker-dealer may use a portion of the
commissions paid by the fund to reduce the fund's custodian or transfer
agent fees.
UNDERSTANDING THE
MANAGEMENT FEE
The management fee FMR
receives is designed to be
responsive to changes in
FMR's total assets under
management. Building this
variable into the fee
calculation assures
shareholders that they will
pay a lower rate as FMR's
assets under management
increase.
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The fund has adopted a Distribution and Service Plan. This plan recognizes
that FMR may use its resources, including management fees, to pay expenses
associated with the sale of fund shares. This may include payments to third
parties, such as banks or broker-dealers, that provide shareholder support
services or engage in the sale of the fund's shares. It is important to
note, however, that the fund does not pay FMR any separate fees for this
service.
The fund's portfolio turnover rate for the fiscal year ended
September 1996 was 148 %. This rate varies from year to year. High
turnover rates increase transaction costs and may increase taxable capital
gains. FMR considers these effects when evaluating the anticipated benefits
of short-term investing.
YOUR ACCOUNT

DOING BUSINESS WITH FIDELITY
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, FBSI. Fidelity is also a leader
in providing tax-sheltered retirement plans for individuals investing on
their own or through their employer.
Fidelity is committed to providing investors with practical information to
make investment decisions. Based in Boston, Fidelity provides customers
with complete service 24 hours a day, 365 days a year, through a network of
telephone service centers around the country.
To reach Fidelity for general information, call these numbers:
(small solid bullet) For mutual funds, 1-800-544-8888
(small solid bullet) For brokerage, 1-800-544-7272
If you would prefer to speak with a representative in person, Fidelity has
over 80 walk-in Investor Centers across the country.
TYPES OF ACCOUNTS
You may set up an account directly in the fund or, if you own or intend to
purchase individual securities as part of your total investment portfolio,
you may consider investing in the fund through a brokerage account.
You may purchase or sell shares of the fund through an investment
professional, including a broker, who may charge you a transaction fee for
this service. If you invest through FBSI, another financial institution, or
an investment professional, read their program materials for any special
provisions, additional service features or fees that may apply to your
investment in the fund. Certain features of the fund, such as the minimum
initial or subsequent investment amounts, may be modified.
FIDELITY FACTS
Fidelity offers the broadest
selection of mutual funds in
the world.
(solid bullet) Number of Fidelity mutual
funds: over 225
(solid bullet) Assets in Fidelity mutual
funds: over $432 billion
(solid bullet) Number of shareholder
accounts: over 29 million
(solid bullet) Number of investment
analysts and portfolio
managers: over 270
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The different ways to set up (register) your account with Fidelity are
listed in the table that follows.
The account guidelines that follow may not apply to certain retirement
accounts. If you are investing through a retirement account or if your
employer offers the fund through a retirement program, you may be subject
to additional fees. For more information, please refer to your program
materials, contact your employer or call your retirement benefits number or
Fidelity directly, as appropriate.
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have two or
more owners (tenants).
RETIREMENT
TO SHELTER YOUR RETIREMENT SAVINGS FROM TAXES
Retirement plans allow individuals to shelter investment income and
capital gains from current taxes. In addition, contributions to these
accounts may be tax deductible. Retirement accounts require special
applications and typically have lower minimums.
(solid bullet) INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow anyone of legal
age and under 70 with earned income to invest up to $2,000 per tax year.
Individuals can also invest in a spouse's IRA if the spouse has earned
income of less than $250.
(solid bullet) ROLLOVER IRAS retain special tax advantages for certain
distributions from employer-sponsored retirement plans.
(solid bullet) KEOGH OR CORPORATE PROFIT SHARING AND MONEY PURCHASE PENSION
PLANS allow self-employed individuals or small business owners (and their
employees) to make tax-deductible contributions for themselves and any
eligible employees up to $30,000 per year.
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide small
business owners or those with self-employed income (and their eligible
employees) with many of the same advantages as a Keogh, but with fewer
administrative requirements.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are available to employees of most
tax-exempt institutions, including schools, hospitals, and other charitable
organizations.
(solid bullet) 401(K) PROGRAMS allow employees of corporations of all sizes
to contribute a percentage of their wages on a tax-deferred basis. These
accounts need to be established by the trustee of the plan.
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and obtain
tax benefits. An individual can give up to $10,000 a year per child without
paying federal gift tax. Depending on state laws, you can set up a
custodial account under the Uniform Gifts to Minors Act (UGMA) or the
Uniform Transfers to Minors Act (UTMA).
TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS
Requires a special application.
HOW TO BUY SHARES
THE FUND'S SHARE PRICE, called net asset value (NAV), is calculated every
business day. The fund's shares are sold without a sales charge.
Shares are purchased at the next share price calculated after your
investment is received and accepted. Share price is normally calculated at
4 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application and
mail it along with your check. You may also open your account in person or
by wire as described on page . If there is no application accompanying this
prospectus, call 1-800-544-8888.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail in an application with a check, or
(small solid bullet) Open your account by exchanging from another Fidelity
fund.
IF YOU ARE INVESTING THROUGH A TAX-SHELTERED RETIREMENT PLAN, such as an
IRA, for the first time, you will need a special application. Retirement
investing also involves its own investment procedures. Call 1-800-544-8888
for more information and a retirement application.
If you buy shares by check or Fidelity Money Line(registered trademark),
and then sell those shares by any method other than by exchange to another
Fidelity fund, the payment may be delayed for up to seven business days to
ensure that your previous investment has cleared.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $2,500
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $500
TO ADD TO AN ACCOUNT $250
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $250
Through regular investment plans* $100
MINIMUM BALANCE $ 2 ,000
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $500
* FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO
"INVESTOR SERVICES," PAGE .
These minimums may vary for investments through Fidelity Portfolio Advisory
Services or a Fidelity Payroll Deduction Program account in the fund.
There is no minimum account balance or initial or subsequent investment
minimums for certain retirement accounts funded through salary reduction,
or accounts opened with the proceeds of distributions from such Fidelity
retirement accounts. Refer to the program materials for details.

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TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT

Phone 1-800-544-777 (phone_graphic) (small solid bullet) Exchange from another (small solid bullet) Exchange from another
Fidelity fund account Fidelity fund account
with the same with the same
registration, including registration, including
name, address, and name, address, and
taxpayer ID number. taxpayer ID number.
(small solid bullet) Use Fidelity Money
Line to transfer from
your bank account. Call
before your first use to
verify that this service
is in place on your
account. Maximum
Money Line: $50,000.

</TABLE>

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Mail (mail_graphic) (small solid bullet) Complete and sign the (small solid bullet) Make your check
application. Make your payable to "Fidelity
check payable to Asset Manager:
"Fidelity Asset Income." Indicate your
Manager: Income." Mail fund account number
to the address on your check and mail
indicated on the to the address printed
application. on your account
statement.
(small solid bullet) Exchange by mail: call
1-800-544-6666 for
instructions.

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In Person (hand_graphic) (small solid bullet) Bring your application (small solid bullet) Bring your check to a
and check to a Fidelity Fidelity Investor Center.
Investor Center. Call Call 1-800-544-9797 for
1-800-544-9797 for the the center nearest you.
center nearest you.

</TABLE>

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Wire (wire_graphic) (small solid bullet) Call 1-800-544-7777 to (small solid bullet) Not available for
set up your account retirement accounts.
and to arrange a wire (small solid bullet) Wire to:
transaction. Not Bankers Trust
available for retirement Company,
accounts. Bank Routing
(small solid bullet) Wire within 24 hours to: #021001033,
Bankers Trust Account #00163053.
Company, Specify "Fidelity Asset
Bank Routing Manager: Income" and
#021001033, include your account
Account #00163053. number and your
Specify "Fidelity Asset name.
Manager: Income" and
include your new
account number and
your name.

</TABLE>

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Automatically (automatic_graphic) (small solid bullet) Not available. (small solid bullet) Use Fidelity Automatic
Account Builder. Sign
up for this service
when opening your
account, or call
1-800-544-6666 to add
it.

</TABLE>

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(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118

</TABLE>

HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares. Your shares will be sold at
the next share price calculated after your order is received and accepted.
Share price is normally calculated at 4 p.m. Eastern time.
TO SELL SHARES IN A NON-RETIREMENT ACCOUNT, you may use any of the methods
described on these two pages.
TO SELL SHARES IN A FIDELITY RETIREMENT ACCOUNT, your request must be made
in writing, except for exchanges to other Fidelity funds, which can be
requested by phone or in writing. Call 1-800-544-6666 for a retirement
distribution form.
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).
TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE, you will need to sign
up for these services in advance.
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 redeem 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.
SELLING SHARES IN WRITING
Write a "letter of instruction" with:
(small solid bullet) Your name,
(small solid bullet) The fund's name,
(small solid bullet) Your fund account number,
(small solid bullet) The dollar amount or number of shares to be redeemed,
and
(small solid bullet) Any other applicable requirements listed in the table
that follows.
Unless otherwise instructed, Fidelity will send a check to the record
address. Deliver your letter to a Fidelity Investor Center, or mail it to:
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
ACCOUNT TYPE SPECIAL REQUIREMENTS

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Phone 1-800-544-777 (phone_graphic) All account types (small solid bullet) Maximum check request:
except retirement $100,000.
(small solid bullet) For Money Line transfers to
All account types your bank account; minimum:
$10; maximum: $100,000.
(small solid bullet) You may exchange to other
Fidelity funds if both
accounts are registered with
the same name(s), address,
and taxpayer ID number.

Mail or in Person (mail_graphic)(hand_graphic) Individual, Joint (small solid bullet) The letter of instruction must
Tenant, be signed by all persons
Sole Proprietorship required to sign for
, UGMA, UTMA transactions, exactly as their
Retirement account names appear on the
account.
(small solid bullet) The account owner should
Trust complete a retirement
distribution form. Call
1-800-544-6666 to request
one.
Business or (small solid bullet) The trustee must sign the
Organization letter indicating capacity as
trustee. If the trustee's name
is not in the account
registration, provide a copy of
the trust document certified
Executor, within the last 60 days.
Administrator, (small solid bullet) At least one person
Conservator, authorized by corporate
Guardian resolution to act on the
account must sign the letter.
(small solid bullet) Include a corporate
resolution with corporate seal
or a signature guarantee.
(small solid bullet) Call 1-800-544-6666 for
instructions.

Wire (wire_graphic) All account types (small solid bullet) You must sign up for the wire
except retirement feature before using it. To
verify that it is in place, call
1-800-544-6666. Minimum
wire: $5,000.
(small solid bullet) Your wire redemption request
must be received and
accepted by Fidelity before 4
p.m. Eastern time for money
to be wired on the next
business day.

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(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118

</TABLE>

To reduce expenses, only one copy of most financial reports and
prospectuses will be mailed to your household, even if you have more than
one account in the fund. Call 1-800-544-6666 if you need copies of
financial reports, prospectuses, or historical account information.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of other
Fidelity funds by telephone or in writing.
Note that exchanges out of the fund are limited to four per calendar year,
and that they may have tax consequences for you. For details on policies
and restrictions governing exchanges, including circumstances under which a
shareholder's exchange privilege may be suspended or revoked, see page .
SYSTEMATIC WITHDRAWAL PLANS let you set up periodic redemptions from your
account.
FIDELITY MONEY LINE enables you to transfer money by phone between your
bank account and your fund account. Most transfers are complete within
three business days of your call.
REGULAR INVESTMENT PLANS
One easy way to pursue your financial goals is to invest money regularly.
Fidelity offers convenient services that let you transfer money into your
fund account, or between fund accounts, automatically. While regular
investment plans 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. Certain restrictions apply for retirement accounts. Call
1-800-544-6666 for more information.
REGULAR INVESTMENT PLANS
FIDELITY AUTOMATIC ACCOUNT BUILDERSM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY FUND

<TABLE>
<CAPTION>
<S> <C> <C>
MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 Monthly or (small solid bullet) For a new account, complete the
quarterly appropriate section on the fund
application.
(small solid bullet) For existing accounts, call
1-800-544-6666 for an application.
(small solid bullet) To change the amount or frequency of
your investment, call 1-800-544-6666 at
least three business days prior to your
next scheduled investment date.

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 Every pay (small solid bullet) Check the appropriate box on the fund
period application, or call 1-800-544-6666 for an
authorization form.
(small solid bullet) Changes require a new authorization
form.

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 Monthly, (small solid bullet) To establish, call 1-800-544-6666 after
bimonthly, both accounts are opened.
quarterly, or (small solid bullet) To change the amount or frequency of
annually your investment, call 1-800-544-6666.

</TABLE>

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

DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net income and capital gains
to shareholders each year. Normally, dividends are distributed monthly.
Capital gains are distributed in December.
DISTRIBUTION OPTIONS
When you open an account, specify on your application how you want to
receive your distributions. If the option you prefer is not listed on the
application, call 1-800-544-6666 for instructions. The fund offers four
options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions will
be automatically reinvested in additional shares of the fund. If you do not
indicate a choice on your application, you will be assigned this option.
2. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested, but you will be sent a check for each dividend
distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions.
4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and
capital gain distributions will be automatically invested in another
identically registered Fidelity fund.
FOR RETIREMENT ACCOUNTS, all distributions are automatically reinvested.
When you are over 59 years old, you can receive distributions in cash.
When the fund deducts a distribution from its NAV, the reinvestment price
is the fund's NAV at the close of business that day. Cash distribution
checks will be mailed within seven days.
UNDERSTANDING
DISTRIBUTIONS
As a fund shareholder, you
are entitled to your share of
the fund's net income and
gains on its investments. The
fund passes its earnings
along to its investors as
DISTRIBUTIONS.
The fund earns dividends
from stocks and interest from
bond, money market, and
other investments. These are
passed along as DIVIDEND
DISTRIBUTIONS. The fund
realizes capital gains
whenever it sells securities
for a higher price than it paid
for them. These are passed
along as CAPITAL GAIN
DISTRIBUTIONS.
(checkmark)
TAXES
As with any investment, you should consider how your investment in the fund
will be taxed. If your account is not a tax-deferred retirement account,
you should be aware of these tax implications.
TAXES ON DISTRIBUTIONS. Distributions are subject to federal income tax,
and may also be subject to state or local taxes. If you live outside the
United States, your distributions could also be taxed by the country in
which you reside. Your distributions are taxable when they are paid,
whether you take them in cash or reinvest them. However, distributions
declared in December and paid in January are taxable as if they were paid
on December 31.
For federal tax purposes, the fund's income and short-term capital gain
distributions are taxed as dividends; long-term capital gain distributions
are taxed as long-term capital gains. Every January, Fidelity will send you
and the IRS a statement showing the taxable distributions paid to you in
the previous year.
TAXES ON TRANSACTIONS. Your redemptions - including exchanges to other
Fidelity funds - are subject to capital gains tax. A capital gain or loss
is the difference between the cost of your shares and the price you receive
when you sell them.
Whenever you sell shares of the fund, Fidelity will send you a confirmation
statement showing how many shares you sold and at what price. You will also
receive a consolidated transaction statement every January. However, it is
up to you or your tax preparer to determine whether this sale resulted in a
capital gain and, if so, the amount of tax to be paid. Be sure to keep your
regular account statements; the information they contain will be essential
in calculating the amount of your capital gains.
"BUYING A DIVIDEND." If you buy shares when the fund has realized but not
yet distributed income or capital gains, you will pay the full price for
the shares and then receive a portion of the price back in the form of a
taxable distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the fund
and its investments and these taxes generally will reduce the fund's
distributions. However, an offsetting tax credit or deduction may be
available to you. If so, your tax statement will show more taxable income
or capital gains than were actually distributed by the fund, but will also
show the amount of the available offsetting credit or deduction.
There are tax requirements that all funds must follow in order to avoid
federal taxation. In its effort to adhere to these requirements, the fund
may have to limit its investment activity in some types of instruments.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE)
is open. Fidelity normally calculates the fund's NAV as of the close of
business of the NYSE, normally 4 p.m. Eastern time.
THE FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and then dividing the result by the number of
shares outstanding.
The fund's assets are valued primarily on the basis of market quotations.
Foreign securities are valued on the basis of quotations from the primary
market in which they are traded, and are translated from the local currency
into U.S. dollars using current exchange rates. Short-term securities with
remaining maturities of sixty days or less for which quotations are not
readily available are valued on the basis of amortized cost. This method
minimizes the effect of changes in a security's market value. In addition,
if quotations are not readily available, or if the values have been
materially affected by events occurring after the closing of a foreign
market, assets may be valued by a method that the Board of Trustees
believes accurately reflects fair value.
THE FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION PRICE
(price to sell one share) are its NAV.
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require the fund to
withhold 31% of your taxable distributions and redemptions.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does not
follow reasonable procedures designed to verify the identity of the caller.
Fidelity will request personalized security codes or other information, and
may also record calls. You should verify the accuracy of your confirmation
statements immediately after you receive them. If you do not want the
ability to redeem and exchange by telephone, call Fidelity for
instructions.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods
of unusual market activity), consider placing your order by mail or by
visiting a Fidelity Investor Center.
THE FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. The fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they would
disrupt management of the fund.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your order will be processed at the
next offering price calculated after your order is received and accepted.
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) The fund 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
cancelled and you could be liable for any losses or fees the fund or its
transfer agent has incurred.
TO AVOID THE COLLECTION PERIOD associated with check and Money Line
purchases, consider buying shares by bank wire, U.S. Postal money order,
U.S. Treasury check, Federal Reserve check, or direct deposit instead.
CERTAIN FINANCIAL INSTITUTIONS that have entered into sales agreements with
FDC may enter confirmed purchase orders on behalf of customers by phone,
with payment to follow no later than the time when the fund is priced on
the following business day. If payment is not received by that time, the
financial institution could be held liable for resulting fees or losses.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your request is received and accepted. Note the
following:
(small solid bullet) Normally, redemption proceeds will be mailed to you on
the next business day, but if making immediate payment could adversely
affect the fund, it may take up to seven days to pay you.
(small solid bullet) Fidelity Money Line redemptions generally will be
credited to your bank account on the second or third business day after
your phone call.
(small solid bullet) The fund may hold payment on redemptions until it is
reasonably satisfied that investments made by check or Fidelity Money Line
have been collected, which can take up to seven business days.
(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.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of $12.00
from accounts with a value of less than $2,500, 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 the transfer agent, is designed to
offset in part the relatively higher costs of servicing smaller accounts.
Th is 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 in Fidelity
exceed $ 3 0,000. Eligibility for the $ 3 0,000 waiver is
determined by aggregating Fidelity accounts maintained by FSC 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, you will be given 30
days' notice to reestablish the minimum balance. If you do not increase
your balance, Fidelity reserves the right to close your account and send
the proceeds to you. Your shares will be redeemed at the NAV on the day
your account is closed.
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
FDC may, at its own expense, provide promotional incentives to qualified
recipients who support the sale of shares of the fund without reimbursement
from the fund. Qualified recipients are securities dealers who have sold
fund shares or others, including banks and other financial institutions,
under special arrangements in connection with FDC's sales activities. In
some instances, these incentives may be offered only to certain
institutions whose representatives provide services in connection with the
sale or expected sale of significant amounts of shares.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging shares of the fund
for shares of other Fidelity funds. However, you should note the following:
(small solid bullet) The fund you are exchanging into must be available for
sale in your state.
(small solid bullet) You may only exchange 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) If you exchange into a fund with a sales charge, you
pay the percentage-point difference between that fund's sales charge and
any sales charge you have previously paid in connection with the shares you
are exchanging. For example, if you had already paid a sales charge of 2%
on your shares and you exchange them into a fund with a 3% sales charge,
you would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Because excessive trading can hurt fund performance
and shareholders, the fund reserves the right to temporarily or permanently
terminate the exchange privilege of any investor who makes more than four
exchanges out of the fund per calendar year. Accounts under common
ownership or control, including accounts with the same taxpayer
identification number, will be counted together for purposes of the four
exchange limit.
(small solid bullet) The exchange limit may be modified for accounts in
certain institutional retirement plans to conform to plan exchange limits
and Department of Labor regulations. See your plan materials for further
information.
(small solid bullet) The fund reserves the right to 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.
(small solid bullet) Your exchanges may be restricted or refused if the
fund receives or anticipates simultaneous orders affecting significant
portions of the fund's assets. In particular, a pattern of exchanges that
coincides with a "market timing" strategy may be disruptive to the fund.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any time. The
fund reserves the right to terminate or modify the exchange privilege in
the future.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50% on
exchanges. Check each fund's prospectus for details.
The Fidelity Pyramid and Logo, Fidelity Money Line, and Directed Dividends
are registered trademarks of FMR Corp. Fidelity Automatic Account Builder
and TouchTone Xpress are trademarks of FMR Corp.

This prospectus is printed on recycled paper using soy-based inks.
FIDELITY CHARLES STREET TRUST:
FIDELITY ASSET MANAGER: GROWTH

CROSS REFERENCE SHEET
FORM N-1A

ITEM NUMBER PROSPECTUS SECTION

<TABLE>
<CAPTION>
<S> <C> <C> <C>
1 .............................. Cover Page

2 a .............................. Expenses

b, c .............................. Contents; The Fund at a Glance; Who May Want
to Invest

3 a .............................. Financial Highlights

b .............................. *

c .............................. Performance

d .............................. Performance

4 a i............................. Charter

ii........................... The Fund at a Glance; Investment Principles and
Risks, Securities and Investment Practices

b .............................. Investment Principles and Risks, Securities and
Investment Practices

c .............................. Who May Want to Invest; Investment Principles
and Risks, Securities and Investment Practices

5 a .............................. Charter

b i............................. Cover Page; The Fund at a Glance; Charter; Doing
Business with Fidelity, FMR and Its Affiliates

ii........................... Charter, FMR and Its Affiliates

iii.......................... Expenses, Breakdown of Expenses

c .............................. Charter

d .............................. Charter; Breakdown of Expenses

e .............................. Cover Page; Charter

f .............................. Expenses

g i............................. Charter
.

ii............................ *
..

5A .............................. Performance

6 a i............................. Charter

ii........................... How to Buy Shares; How to Sell Shares;
Transaction Details; Exchange Restrictions

iii.......................... Charter

b ............................. Charter, FMR and Its Affiliates

c .............................. Transactions Details; Exchange Restrictions

d .............................. *

e .............................. Cover Page, Doing Business with Fidelity; How to
Buy Shares; How to Sell Shares; Investor Services

f, g .............................. Dividends, Capital Gains, and Taxes

7 a .............................. Cover Page; Charter

b .............................. Expenses; How to Buy Shares; Transaction Details

c .............................. *

d .............................. How to Buy Shares

e .............................. *

f .............................. Expenses, Breakdown of Expenses

8 .............................. How to Sell Shares; Investor Services; Transaction
Details; Exchange Restrictions

9 .............................. *

</TABLE>

* Not Applicable

LIKE ALL MUTUAL
FUNDS, THESE
SECURITIES HAVE NOT
BEEN APPROVED OR
DISAPPROVED BY THE
SECURITIES AND
EXCHANGE
COMMISSION OR ANY
STATE SECURITIES
COMMISSION, NOR HAS
THE SECURITIES AND
EXCHANGE
COMMISSION OR ANY
STATE SECURITIES
COMMISSION PASSED
UPON THE ACCURACY
OR ADEQUACY OF THIS
PROSPECTUS. ANY
REPRESENTATION TO
THE CONTRARY IS A
CRIMINAL OFFENSE.
AMG-pro-1196-01
(fund number 321, trading symbol FASGX)
This asset allocation fund seeks to maximize total return over the long
term through investments in stocks, bonds and short-term and money market
instruments of all types.
FIDELITY
ASSET
MANAGER:
GROWTH
PROSPECTUS
FEBRUARY 17, 1997(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON, MA
02109

CONTENTS

KEY FACTS THE FUND AT A GLANCE

WHO MAY WANT TO INVEST

EXPENSES The fund's yearly
operating expenses.

FINANCIAL HIGHLIGHTS A summary
of the fund's financial data.

PERFORMANCE How the fund has
done over time.

THE FUND IN DETAIL CHARTER How the fund is
organized.

INVESTMENT PRINCIPLES AND RISKS
The fund's overall approach to
investing.

BREAKDOWN OF EXPENSES How
operating costs are calculated and
what they include.

YOUR ACCOUNT DOING BUSINESS WITH FIDELITY

TYPES OF ACCOUNTS Different
ways to set up your account,
including tax-sheltered retirement
plans.

HOW TO BUY SHARES Opening an
account and making additional
investments.

HOW TO SELL SHARES Taking money
out and closing your account.

INVESTOR SERVICES Services to
help you manage your account.

SHAREHOLDER AND DIVIDENDS, CAPITAL GAINS,
ACCOUNT POLICIES AND TAXES

TRANSACTION DETAILS Share price
calculations and the timing of
purchases and redemptions.

EXCHANGE RESTRICTIONS

KEY FACTS

THE FUND AT A GLANCE
GOAL: Maximum total return over the long term. As with any mutual fund,
there is no assurance that the fund will achieve its goal.
STRATEGY: The fund diversifies across stocks, bonds and short-term and
money market instruments, both here and abroad, to pursue its goal. The
fund has a neutral mix which represents the way the fund's investments will
generally be allocated over the long term. This mix will vary over
short-term periods as fund management gradually adjusts the fund's holdings
- - within defined ranges - based on the current outlook for the different
markets.
Neutral Mix
Stocks 70%
(can range
from
50-100%)
Row: 1, Col: 1, Value: 5.0
Row: 1, Col: 2, Value: 70.0
Row: 1, Col: 3, Value: 25.0
Bonds 25%
(can range
from
0-50%)
Short-Term/M
oney Market
5%
(can range
from
0-50%)
MANAGEMENT: Fidelity Management & Research Company (FMR) is the management
arm of Fidelity Investments, which was established in 1946 and is now
America's largest mutual fund manager. Foreign affiliates of FMR may help
choose investments for the fund.
SIZE: As of September 30, 1996, the fund had over $3.0 billion in
assets.
WHO MAY WANT TO INVEST
The fund may be appropriate for investors who want to diversify among
domestic and foreign stocks, bonds, short-term and money market
instruments, and other types of securities in one fund. If you are looking
for a fund that can invest in a wide range of security types within defined
ranges in pursuit of total return, this fund may be appropriate for you.
Because the fund owns different types of investments, its performance is
affected by a variety of factors. The value of the fund's investments and
the income they generate will vary from day to day, and generally reflect
interest rates, market conditions, and other company, political, and
economic news. Performance also depends on FMR's skill in allocating
assets. When you sell your fund shares, they may be worth more or less than
what you paid for them.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or
sell shares of a fund. In addition, you may be charged an annual account
maintenance fee if your account balance falls below $2,500. See
"Transaction Details" page , for an explanation of how and when these
charges apply.
Maximum sales charge on purchases None
and reinvested distributions

Deferred sales charge on redemptions None

Exchange fee None

Annual account maintenance fee $12.0
(for accounts under $2,500) 0

ANNUAL FUND OPERATING EXPENSES are paid out of the fund's assets. The fund
pays a management fee to FMR. It also incurs other expenses for services
such as maintaining shareholder records and furnishing shareholder
statements and financial reports. The fund's expenses are factored into its
share price or dividends and are not charged directly to shareholder
accounts (see page ).
The following figures are based on historical expenses, adjusted to reflect
current fees, and are calculated as a percentage of average net assets. A
portion of the brokerage commissions that the fund pays is used to reduce
fund expenses. In addition, the fund has entered into arrangements with its
custodian and transfer agent whereby interest earned on uninvested cash
balances is used to reduce custodian and transfer agent expenses. Including
these reductions, the total operating expenses presented in the table would
have been .93 %.
Management fee .61%
*

12b-1 fee Non
e

Other expenses .33%

Total fund operating expenses .94%

* EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
.40% TO .30%. IF THIS AGREEMENT WERE NOT IN EFFECT, THE MANAGEMENT FEE AND
TOTAL OPERATING EXPENSES WOULD HAVE BEE N .71% AND 1.04 %,
RESPECTIVELY.
EXAMPLES: Let's say, hypothetically, that the fund's annual return is 5%
and that its operating expenses are exactly as just described. For every
$1,000 you invested, here's how much you would pay in total expenses if you
close your account after the number of years indicated:
After 1 year $10

After 3 years $30

After 5 years $52

After 10 years $11
5

These examples illustrate the effect of expenses, but are not meant to
suggest actual or expected costs or returns, all of which may vary.
UNDERSTANDING
EXPENSES
Operating a mutual fund
involves a variety of
expenses for portfolio
management, shareholder
statements, tax reporting, and
other services. These costs
are paid from the fund's
assets; their effect is already
factored into any quoted
share price or return.
(checkmark)
FINANCIAL HIGHLIGHTS
The financial highlights table that follows has been audited by
Price Waterhouse LLP , independent accountants. The fund's
financial highlights, financial statements and report of the
auditor are included in the fund's Annual Report , and are
incorporated by reference into (are legally a part of) the fund's SAI.
Contact Fidelity for a free copy of the Annual Report or the SAI.
SELECTED PER-SHARE DATA

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
21.Years ended September 30 1996 1995 1994F 1993 1992E

22.Net asset value, beginning of $ 14.88 $ 13.91 $ 13.77 $ 11.16 $ 10.00
period

23.Income from Investment
Operations

24. Net investment income .47 .26 .13 .18 .14

25. Net realized and unrealized 1.44 1.07 .61 2.66 1.02
gain (loss)

26. Total from investment 1.91 1.33 .74 2.84 1.16
operations

27.Less Distributions

28. From net investment income (.23) (.27) (.18) (.15) --

29. From net realized gain -- -- (.37) (.08) --

30. In excess of net realized -- (.09) (.05) -- --
gain

31. Total distributions (.23) (.36) (.60) (.23) --

32.Net asset value, end of $ 16.56 $ 14.88 $ 13.91 $ 13.77 $ 11.16
period

33.Total returnB,C 12.99% 9.95% 5.39% 25.83% 11.60%

34.RATIOS AND SUPPLEMENTAL DATA

35.Net assets, end of period (in $ 3,099 $ 2,850 $ 3,071 $ 1,243 $ 94
millions)

36.Ratio of expenses to 1.02% 1.03% 1.15% 1.19% 1.64%
average net assets D A

37.Ratio of expenses to 1.01% 1.02% 1.15% 1.19% 1.64%
average net assets G G A
after expense reductions

38.Ratio of net investment 2.51% 3.16% 2.64% 3.02% 3.50%
income to average A
net assets

39.Portfolio turnover rate 138% 119% 104% 97% 693%
A

40.Average commission rateH $ .0027

</TABLE>

A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
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 DECEMBER 30, 1991 (COMMENCEMENT OF OPERATIONS) TO SEPTEMBER 30, 1992
F EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
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.
H FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
PERFORMANCE
Mutual fund performance is commonly measured as TOTAL RETURN. The total
returns that follow are based on historical fund results and do not reflect
the effect of taxes.
The fund's fiscal year runs from October 1 through September 30. The tables
below show the fund's performance over past fiscal years compared to
different measures, including a comparative index and a competitive funds
average. The chart on page presents calendar year performance.
AVERAGE ANNUAL TOTAL RETURNS
Fiscal periods ended Pas Life
September 30, 1996 t 1 of
yea fund
r A

Asset Manager: Growth 12.99 13.65
% %

S&P 500(registered trademark) 20.33 14.74
% %

Lipper Flexible Portfolio 12.33 n/a
Funds Average %

CUMULATIVE TOTAL RETURNS
Fiscal periods ended Pas Life
September 30, 1996 t 1 of
yea fund
r A

Asset Manager: Growth 12.99 83.86
% %

S&P 500 20.33 92.40
% %

Lipper Flexible Portfolio 12.33 n/a
Funds Average %

A FROM DECEMBER 30, 1991 (COMMENCEMENT OF OPERATIONS)
EXAMPLE: Let's say, hypothetically, that you put $10,000 in the fund on
December 30, 1991. From that date through September 30, 1996, the fund's
total return was 83.86%. Your $10,000 would have grown to $18,386(the
initial investment plus 83.86% of $10,000).
UNDERSTANDING
PERFORMANCE
As economic conditions
change, different types of
investments do better than
others. While Asset Manager:
Growth usually invests in
stocks, bonds and short-term
and money market
instruments, its emphasis is in
stocks. The fund's
performance tends to be
related to that of the overall
performance of both domestic
and foreign markets, but will
also reflect the performance of
the other investments in its mix
during the time period.
(checkmark)
$10,000 OVER LIFE OF FUND
Fiscal years 1991 1994 1996
Row: 1, Col: 1, Value: 10000.0
Row: 2, Col: 1, Value: 10080.0
Row: 3, Col: 1, Value: 10450.0
Row: 4, Col: 1, Value: 10670.0
Row: 5, Col: 1, Value: 10520.0
Row: 6, Col: 1, Value: 10550.0
Row: 7, Col: 1, Value: 10770.0
Row: 8, Col: 1, Value: 10650.0
Row: 9, Col: 1, Value: 11090.0
Row: 10, Col: 1, Value: 10910.0
Row: 11, Col: 1, Value: 11160.0
Row: 12, Col: 1, Value: 11370.0
Row: 13, Col: 1, Value: 11780.0
Row: 14, Col: 1, Value: 12003.17
Row: 15, Col: 1, Value: 12176.54
Row: 16, Col: 1, Value: 12329.51
Row: 17, Col: 1, Value: 12808.82
Row: 18, Col: 1, Value: 12849.61
Row: 19, Col: 1, Value: 13114.76
Row: 20, Col: 1, Value: 13308.53
Row: 21, Col: 1, Value: 13553.28
Row: 22, Col: 1, Value: 14103.98
Row: 23, Col: 1, Value: 14042.79
Row: 24, Col: 1, Value: 14481.31
Row: 25, Col: 1, Value: 14358.93
Row: 26, Col: 1, Value: 15161.86
Row: 27, Col: 1, Value: 15747.06
Row: 28, Col: 1, Value: 15278.9
Row: 29, Col: 1, Value: 14502.18
Row: 30, Col: 1, Value: 14480.9
Row: 31, Col: 1, Value: 14597.94
Row: 32, Col: 1, Value: 14161.71
Row: 33, Col: 1, Value: 14512.82
Row: 34, Col: 1, Value: 15023.54
Row: 35, Col: 1, Value: 14800.1
Row: 36, Col: 1, Value: 14842.66
Row: 37, Col: 1, Value: 14417.06
Row: 38, Col: 1, Value: 14041.71
Row: 39, Col: 1, Value: 13691.76
Row: 40, Col: 1, Value: 13921.41
Row: 41, Col: 1, Value: 14205.75
Row: 42, Col: 1, Value: 14599.44
Row: 43, Col: 1, Value: 14960.32
Row: 44, Col: 1, Value: 15277.47
Row: 45, Col: 1, Value: 15911.75
Row: 46, Col: 1, Value: 15999.24
Row: 47, Col: 1, Value: 16272.63
Row: 48, Col: 1, Value: 16075.7
Row: 49, Col: 1, Value: 16469.48
Row: 50, Col: 1, Value: 16843.14
Row: 51, Col: 1, Value: 17398.28
Row: 52, Col: 1, Value: 17376.08
Row: 53, Col: 1, Value: 17409.39
Row: 54, Col: 1, Value: 17709.17
Row: 55, Col: 1, Value: 17909.02
Row: 56, Col: 1, Value: 17986.74
Row: 57, Col: 1, Value: 17531.52
Row: 58, Col: 1, Value: 17653.65
Row: 59, Col: 1, Value: 18386.45
$
$18,386
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment over a given period,
assuming reinvestment of any dividends and capital gains. A CUMULATIVE
TOTAL RETURN reflects actual performance over a stated period of time. An
AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that, if
achieved annually, would have produced the same cumulative total return if
performance had been constant over the entire period. Average annual total
returns smooth out variations in performance; they are not the same as
actual year-by-year results.
YEAR-BY-YEAR TOTAL RETURNS
Calendar years 1992 1993 1994 1995
ASSET MANAGER: GROWTH 19.08% 26.32% -7.39% 19.
95%
S&P 500 7.62% 10.08% 1.32% 37.5
8%
Lipper Flexible Portfolio Funds Average 7.51
% 11.94% -2.65% 25.08%
Consumer Price Index 2.90% 2.75% 2.67% 2.54
%
Percentage (%)
Row: 1, Col: 1, Value: 0.0
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: 19.08
Row: 8, Col: 1, Value: 26.32
Row: 9, Col: 1, Value: -7.39
Row: 10, Col: 1, Value: 19.95
(LARGE SOLID BOX) Asset
Manager:
Growth
YIELD refers to the income generated by an investment in the fund over a
given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all stock and bond
funds. Because this differs from other accounting methods, the quoted yield
may not equal the income actually paid to shareholders.
THE STANDARD & POOR'S 500 INDEX (S&P 500(registered trademark)) is a widely
recognized, unmanaged index of common stocks.
Unlike the fund's returns, the total returns of the comparative index do
not include the effect of any brokerage commissions, transaction fees, or
other costs of investing.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government.
THE COMPETITIVE FUNDS AVERAGE is the Lipper Flexible Portfolio Funds
Average, which currently reflects the performance of over 150 mutual
funds with similar investment objectives. This average, published by Lipper
Analytical Services, Inc., excludes the effect of sales charges.
Other illustrations of fund performance may show moving averages over
specified periods.
The fund's recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders. For
current performance or a free annual report, call 1-800-544-8888.
TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN
INDICATION OF FUTURE PERFORMANCE.
THE FUND IN DETAIL

CHARTER
ASSET MANAGER: GROWTH IS A MUTUAL FUND: an investment that pools
shareholders' money and invests it toward a specified goal. The fund is a
diversified fund of Fidelity Charles Street Trust, an open-end management
investment company organized as a Massachusetts business trust on July 7,
1981.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the fund's activities,
review contractual arrangements with companies that provide services to the
fund, and review the fund's performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These meetings
may be called to elect or remove trustees, change fundamental policies,
approve a management contract, or for other purposes. Shareholders not
attending these meetings are encouraged to vote by proxy. Fidelity will
mail proxy materials in advance, including a voting card and information
about the proposals to be voted on. The number of votes you are entitled to
is based upon the dollar value of your investment.
FMR AND ITS AFFILIATES
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs. Fidelity Management & Research (U.K.) Inc.
(FMR U.K.), in London, England, and Fidelity Management & Research (Far
East) Inc. (FMR Far East), in Tokyo, Japan, assist FMR with foreign
investments.
Richard Habermann is vice president and lead manager of Asset Manager:
Growth, which he has managed since March 1996. He also manages several
other Fidelity funds. Previously, Mr. Habermann was chief investment
officer for Fidelity International, Ltd., from 1991 to 1993, and division
head for international equities and director of international research,
from 1993 to 1996. Mr. Habermann joined Fidelity in 1968.
George Vanderheiden is vice president of Asset Manager: Growth and manager
of its equity investments, which he has managed since March 1996. He also
manages several other Fidelity funds. Mr. Vanderheiden joined Fidelity in
1971.
Charles Morrison is manager of Asset Manager: Growth's
fixed-income investments, which he has managed since February 1997 .
He also manages several other Fidelity funds. Mr. Morrison joined
Fidelity in 198 7 .
John Todd is vice president of Asset Manager: Growth and manager of its
short-term and money market investments, which he has managed since
December 1996. He also manages several other Fidelity funds. Mr. Todd
joined Fidelity in 1981.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation (FDC) distributes and markets Fidelity's
funds and services. Fidelity S ervice Company, Inc . (FSC) performs
transfer agent servicing functions for the fund.
FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far
East. Members of the Edward C. Johnson 3d family are the predominant owners
of a class of shares of common stock representing approximately 49% of the
voting power of FMR Corp. Under the Investment Company Act of 1940 (the
1940 Act), control of a company is presumed where one individual or group
of individuals owns more than 25% of the voting stock of that company;
therefore, the Johnson family may be deemed under the 1940 Act to form a
controlling group with respect to FMR Corp.
A broker-dealer may use a portion of the commissions paid by the fund to
reduce the fund's custodian or transfer agent fees. FMR may use its
broker-dealer affiliates and other firms that sell fund shares to carry out
the fund's transactions, provided that the fund receives brokerage services
and commission rates comparable to those of other broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
THE FUND'S INVESTMENT APPROACH
The fund seeks to maximize total return over the long term by allocating
its assets among stocks, bonds, short-term and money market instruments,
and other instruments of U.S. and foreign issuers.
The fund allocates its assets among the following classes, or types, of
investments. The STOCK CLASS includes equity securities of all types. The
BOND CLASS includes all varieties of fixed-income securities maturing in
more than one year. The SHORT-TERM/MONEY MARKET CLASS includes all types of
short-term and money market instruments. FMR may use its judgment to place
a security in the most appropriate class based on its investment
characteristics. Fixed-income securities may be classified in the bond or
short-term/money market class according to interest rate sensitivity as
well as maturity. The fund may also make other investments that do not fall
within these classes.
FMR has the ability to allocate the fund's assets within specified ranges.
The fund's NEUTRAL MIX represents the benchmark for its combination of
investments in each asset class over time. FMR may change the neutral mix
from time to time. The range and approximate neutral mix for each asset
class are shown below.
Range Neutral Mix
STOCK CLASS 50 - 100% 70%
BOND CLASS 0 - 50% 25%
SHORT-TERM /
MONEY MARKET CLASS 0 - 50% 5%
Asset Manager: Growth's aggressive approach focuses on stocks for high
potential returns. However, because the fund can invest in bonds and
short-term and money market instruments, its return may not be as high as a
fund that invests only in stocks.
Since the fund is subject to the risks of each investment type, the fund
and its performance are affected by many factors. Stock values fluctuate in
response to the activities of individual companies and general market and
economic conditions. The value of bonds and short-term instruments
fluctuates based on changes in interest rates and in the credit quality of
the issuer. FMR may use various investment techniques to hedge a portion of
the fund's risks, but there is no guarantee that these strategies will work
as FMR intends. When you sell your shares, they may be worth more or less
than what you paid for them.
In pursuit of the fund's objective, FMR will not try to pinpoint the
precise moment when a major reallocation should be made. Instead, FMR
regularly reviews the fund's allocations and makes changes gradually to
favor investments that it believes will provide the most favorable outlook
for achieving the fund's objective. Under normal circumstances, a single
reallocation will not involve more than 20% of the fund's total assets.
Although FMR uses its expertise and resources in allocating assets, FMR's
decisions may not be advantageous to the fund.
FMR normally invests the fund's assets according to its investment
strategy. The fund also reserves the right to invest without limitation in
preferred stocks and investment-grade debt instruments for temporary,
defensive purposes.
The fund diversifies across investment types more than most mutual funds.
No one mutual fund, however, can provide an appropriate balanced investment
plan for all investors.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies FMR may employ in
pursuit of the fund's investment objective, and a summary of related risks.
Any restrictions listed supplement those discussed earlier in this section.
A complete listing of the fund's limitations and more detailed information
about the fund's investments are contained in the fund's SAI. Policies and
limitations are considered at the time of purchase; the sale of instruments
is not required in the event of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques
unless it believes that they are consistent with the fund's investment
objective and policies and that doing so will help the fund achieve its
goal. Fund holdings and recent investment strategies are detailed in the
fund's financial reports, which are sent to shareholders twice a year. For
a free SAI or financial report, call 1-800-544-8888.
EQUITY SECURITIES may include common stocks and warrants. Common stocks,
the most familiar type, represent an equity (ownership) interest in a
corporation. Although equity securities have a history of long-term growth
in value, their prices fluctuate based on changes in a company's financial
condition and on overall market and economic conditions. Smaller companies
are especially sensitive to these factors.
RESTRICTIONS: With respect to 75% of total assets, the fund may not
purchase more than 10% of the outstanding voting securities of a single
issuer.
DEBT SECURITIES. Bonds and other debt instruments are used by issuers to
borrow money from investors. The issuer generally pays the investor
a fixed , variable , or floating rate of interest, and must
repay the amount borrowed at maturity. Some debt securities, such as zero
coupon bonds, do not pay current interest, but are sold at a
discount from their face values. Debt securities have varying levels of
sensitivity to changes in interest rates and varying degrees of credit
quality. In general, bond prices rise when interest rates fall, and fall
when interest rates rise. Longer-term bonds and zero coupon
bonds are generally more sensitive to interest rate changes .
Lower-quality debt securities (sometimes called "junk bonds") are
considered to have speculative characteristics, and involve greater risk of
default or price changes due to changes in the issuer's creditworthiness,
or they may already be in default. The market prices of these securities
may fluctuate more than higher-quality securities and may decline
significantly in periods of general economic difficulty.
The table on page provides a summary of ratings assigned to debt holdings
(not including money market instruments) in the fund's portfolio. These
figures are dollar-weighted averages of month-end portfolio holdings during
fiscal year ended September 1996, and are presented as a percentage of
total security investments. These percentages are historical and do not
necessarily indicate the fund's current or future debt holdings.
FISCAL YEAR ENDED SEPTEMBER 1996 DEBT HOLDINGS, BY RATING
MOODY'S INVESTORS
SERVICE STANDARD & POOR'S
(AS A % OF INVESTMENTS) (AS A % OF
INVESTMENTS)
Rating Average Rating Average
INVESTMENT GRADE*
Highest quality Aaa 15.2% AAA 15.1 %
High quality Aa 0.1% AA 0.2 %
Upper-medium grade A 0.5% A 0.3 %
Medium grade Baa 0.3% BBB 0.6 %
LOWER QUALITY*
Moderately speculative Ba 0.9% BB 1.2 %
Speculative B 3.4% B 2.4 %
Highly speculative Caa 0.2% CCC 0.2 %
Poor quality Ca 0.0% CC 0.0%
Lowest quality, no interest C C
In default, in arrears -- 0.0% D 0.0%
20.6% 20.0 %
(AS A % OF INVESTMENTS)
SECURITIES NOT RATED BY MOODY'S OR S&P(dagger)
Investment Grade (double dagger) 0.4 %
Lower Quality (double dagger) 0.9 %
Total 1.3 %
* FOR SOME FOREIGN GOVERNMENT OBLIGATIONS, FMR ASSIGNS THE RATINGS OF
THE
SOVEREIGN CREDIT OF THE ISSUING GOVERNMENT.
(dagger) THE DOLLAR-WEIGHTED AVERAGE PERCENTAGES REFLECTED IN THE TABLE MAY
INCLUDE SECURITIES RATED BY OTHER NATIONALLY RECOGNIZED RATING SERVICES, AS
WELL AS UNRATED SECURITIES.
(double dagger) AS DETERMINED BY FMR

RESTRICTIONS: Purchase of a debt security is consistent with the fund's
debt quality policy if it is rated at or above the stated level by Moody's
Investors Service, Standard & Poor's, Duff & Phelps Credit Rating Co., or
Fitch Investors Service, L.P., or is unrated but judged to be of equivalent
quality by FMR. The fund currently intends to limit its investments in
lower than Baa-quality debt securities to less than 35% of its assets.
MONEY MARKET SECURITIES are high-quality, short-term instruments issued by
the U.S. Government, corporations, financial institutions, and other
entities. These securities may carry fixed, variable, or floating interest
rates.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and
securities issued by U.S. entities with substantial foreign operations may
involve additional risks and considerations. These include risks relating
to political or economic conditions in foreign countries, fluctuations in
foreign currencies, withholding or other taxes, operational risks,
increased regulatory burdens, and the potentially less stringent investor
protection and disclosure standards of foreign markets. 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. All of these factors can make foreign
investments, especially those in developing countries, more volatile than
U.S. investments.
ASSET-BACKED AND MORTGAGE SECURITIES include interests in pools of
lower-rated debt securities, consumer loans or mortgages, or complex
instruments such as collateralized mortgage obligations and stripped
mortgage-backed securities. The value of these securities may be
significantly affected by changes in interest rates, the market's
perception of issuers, and the creditworthiness of the parties involved.
Some securities may have a structure that makes their reaction to interest
rates and other factors difficult
to predict, making their value highly volatile. These securities may also
be subject to prepayment risk.
STRIPPED SECURITIES are the separate income or principal components of a
debt security. The risks associated with stripped securities are similar to
those of other debt securities, although stripped securities may be more
volatile and the value of certain types of stripped securities may move in
the same direction as interest rates. U.S. Treasury securities that have
been stripped by a Federal Reserve Bank are obligations issued by the U.S.
Treasury.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a security
at one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices, interest
rates, currency exchange rates, commodity prices, or other factors that
affect security values. These techniques may involve derivative
transactions such as buying and selling options and futures contracts,
entering into currency exchange contracts or swap agreements, purchasing
indexed securities, and selling securities short.
FMR can use these practices to adjust the risk and return characteristics
of the fund's portfolio of investments. If FMR judges market conditions
incorrectly or employs a strategy that does not correlate well with the
fund's investments, these techniques could result in a loss, regardless of
whether the intent was to reduce risk or increase return. These techniques
may increase the volatility of the fund and may involve a small investment
of cash relative to the magnitude of the risk assumed. In addition, these
techniques could result in a loss if the counterparty to the transaction
does not perform as promised.
DIRECT DEBT. Loans and other direct debt instruments are interests in
amounts owed to another party by a company, government, or other borrower.
They have additional risks beyond conventional debt securities because they
may entail less legal protection for the fund, or there may be a
requirement that the fund supply additional cash to a borrower on demand.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by
FMR, under the supervision of the Board of Trustees, to be illiquid, which
means that they may be difficult to sell promptly at an acceptable price.
The sale of some illiquid securities, and some other securities, may be
subject to legal restrictions. Difficulty in selling securities may result
in a loss or may be costly to the fund.
RESTRICTIONS: The fund may not purchase a security if, as a result, more
than 10% of its assets would be invested in illiquid securities.
WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS are trading practices in
which payment and delivery for the securities take place at a future date.
The market value of a security could change during this period.
OTHER INSTRUMENTS may include securities of closed-end investment
companies, real estate-related instruments and precious metals.
CASH MANAGEMENT. The fund may invest in money market securities, in
repurchase agreements, and in a money market fund available only to funds
and accounts managed by FMR or its affiliates, whose goal is to seek a high
level of current income while maintaining a stable $1.00 share price. A
major change in interest rates or a default on the money market fund's
investments could cause its share price to change.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry.
RESTRICTIONS: With respect to 75% of its total assets, the fund may not
purchase a security if, as a result, more than 5% would be invested in the
securities of any issuer. This limitation does not apply to U.S. Government
securities.
The fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government
securities.
BORROWING. The fund may borrow from banks or from other funds advised by
FMR, or through reverse repurchase agreements. If the fund borrows money,
its share price may be subject to greater fluctuation until the borrowing
is paid off. If the fund makes additional investments while borrowings are
outstanding, this may be considered a form of leverage.
RESTRICTIONS: The fund may borrow only for temporary or emergency purposes,
but not in an amount exceeding 331/3% of its total assets.
LENDING securities to broker-dealers and institutions, including Fidelity
Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a means of earning
income. This practice could result in a loss or a delay in recovering the
fund's securities. The fund may also lend money to other funds advised by
FMR.
RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of the fund's
total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
The fund seeks to maximize total return over the long term by allocating
its assets among stocks, bonds, short-term instruments, and other
investments.
With respect to 75% of its total assets, the fund may not purchase a
security if, as a result, more than 5% would be invested in the securities
of any issuer and may not purchase more than 10% of the outstanding voting
securities of a single issuer.
The fund may not invest more than 25% of its total assets in any one
industry.
The fund may borrow only for temporary or emergency purposes, but not in an
amount exceeding 33% of its total assets.
Loans, in the aggregate, may not exceed 33% of the fund's total assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily operations.
Expenses paid out of the fund's assets are reflected in its share price or
dividends; they are neither billed directly to shareholders nor deducted
from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to affiliates who provide
assistance with these services. The fund also pays OTHER EXPENSES, which
are explained on page .
FMR may, from time to time, agree to reimburse the fund for management fees
and other expenses above a specified limit. FMR retains the ability to be
repaid by the fund if expenses fall below the specified limit prior to the
end of the fiscal year. Reimbursement arrangements, which may be terminated
at any time without notice, can decrease the fund's expenses and boost its
performance.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fee is
calculated by adding a group fee rate to an individual fund fee rate, and
multiplying the result by the fund's average net assets.
The group fee rate is based on the average net assets of all the mutual
funds advised by FMR. This rate cannot rise above .52%, and it drops as
total assets under management increase.
For September 1996, the group fee rate was .3050%. The individual fund
fee rate is .30%. The total management fee rate for the fiscal year ended
September 1996 was .69%. Effective August 1, 1996, FMR voluntarily agreed
to reduce the fund's individual fund fee rate from .40% to .30%. If this
reduction were not in effect, the total management fee rate would have been
.71% for the fiscal year ended September 1996.
UNDERSTANDING THE
MANAGEMENT FEE
The management fee FMR
receives is designed to be
responsive to changes in
FMR's total assets under
management. Building this
variable into the fee
calculation assures
shareholders that they will
pay a lower rate as FMR's
assets under management
increase.
(checkmark)
FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These
sub-advisers provide FMR with investment research and advice on issuers
based outside the United States. Under the sub-advisory agreements, FMR
pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively,
of the costs of providing these services.
The sub-advisers may also provide investment management services. In
return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its
management fee rate with respect to the fund's investments that the
sub-adviser manages on a discretionary basis.
OTHER EXPENSES
While the management fee is a significant component of the fund's annual
operating costs, the fund has other expenses as well.
The fund contracts with FSC to perform many transaction and accounting
functions. These services include processing shareholder transactions,
valuing the fund's investments, and handling securities loans. In fiscal
year ended September 1996, the fund paid FSC fees equal to .29 % of
its average net assets.
The fund also pays other expenses, such as legal, audit, and custodian
fees; proxy solicitation costs; and the compensation of trustees who are
not affiliated with Fidelity. A broker-dealer may use a portion of the
commissions paid by the fund to reduce the fund's custodian or transfer
agent fees.
The fund has adopted a Distribution and Service Plan. This plan recognizes
that FMR may use its resources, including management fees, to pay expenses
associated with the sale of fund shares. This may include payments to third
parties, such as banks or broker-dealers, that provide shareholder support
services or engage in the sale of the fund's shares. It is important to
note, however, that the fund does not pay FMR any separate fees for this
service.
The fund's portfolio turnover rate for the fiscal year ended September 1996
was 138 %. This rate varies from year to year. High turnover rates
increase transaction costs and may increase taxable capital gains. FMR
considers these effects when evaluating the anticipated benefits of
short-term investing.
YOUR ACCOUNT

DOING BUSINESS WITH FIDELITY
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, FBSI. Fidelity is also a leader
in providing tax-sheltered retirement plans for individuals investing on
their own or through their employer.
Fidelity is committed to providing investors with practical information to
make investment decisions. Based in Boston, Fidelity provides customers
with complete service 24 hours a day, 365 days a year, through a network of
telephone service centers around the country.
To reach Fidelity for general information, call these numbers:
(small solid bullet) For mutual funds, 1-800-544-8888
(small solid bullet) For brokerage, 1-800-544-7272
If you would prefer to speak with a representative in person, Fidelity has
over 80 walk-in Investor Centers across the country.
TYPES OF ACCOUNTS
You may set up an account directly in the fund or, if you own or intend to
purchase individual securities as part of your total investment portfolio,
you may consider investing in the fund through a brokerage account.
You may purchase or sell shares of the fund through an investment
professional, including a broker, who may charge you a transaction fee for
this service. If you invest through FBSI, another financial institution, or
an investment professional, read their program materials for any special
provisions, additional service features or fees that may apply to your
investment in the fund. Certain features of the fund, such as the minimum
initial or subsequent investment amounts, may be modified.
FIDELITY FACTS
Fidelity offers the broadest
selection of mutual funds
in the world.
(solid bullet) Number of Fidelity mutual
funds: over 225
(solid bullet) Assets in Fidelity mutual
funds: over $432 billion
(solid bullet) Number of shareholder
accounts: over 29 million
(solid bullet) Number of investment
analysts and portfolio
managers: over 270
(checkmark)
The different ways to set up (register) your account with Fidelity are
listed in the table that follows.
The account guidelines that follow may not apply to certain retirement
accounts. If you are investing through a retirement account or if your
employer offers the fund through a retirement program, you may be subject
to additional fees. For more information, please refer to your program
materials, contact your employer or call your retirement benefits number or
Fidelity directly, as appropriate.
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have two or
more owners (tenants).
RETIREMENT
TO SHELTER YOUR RETIREMENT SAVINGS FROM TAXES
Retirement plans allow individuals to shelter investment income and
capital gains from current taxes. In addition, contributions to these
accounts may be tax deductible. Retirement accounts require special
applications and typically have lower minimums.
(solid bullet) INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow anyone of legal
age and under 70 with earned income to invest up to $2,000 per tax year.
Individuals can also invest in a spouse's IRA if the spouse has earned
income of less than $250.
(solid bullet) ROLLOVER IRAS retain special tax advantages for certain
distributions from employer-sponsored retirement plans.
(solid bullet) KEOGH OR CORPORATE PROFIT SHARING AND MONEY PURCHASE PENSION
PLANS allow self-employed individuals or small business owners (and their
employees) to make tax-deductible contributions for themselves and any
eligible employees up to $30,000 per year.
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide small
business owners or those with self-employed income (and their eligible
employees) with many of the same advantages as a Keogh, but with fewer
administrative requirements.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are available to employees of most
tax-exempt institutions, including schools, hospitals, and other charitable
organizations.
(solid bullet) 401(K) PROGRAMS allow employees of corporations of all sizes
to contribute a percentage of their wages on a tax-deferred basis. These
accounts need to be established by the trustee of the plan.
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and obtain
tax benefits. An individual can give up to $10,000 a year per child without
paying federal gift tax. Depending on state laws, you can set up a
custodial account under the Uniform Gifts to Minors Act (UGMA) or the
Uniform Transfers to Minors Act (UTMA).
TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS
Requires a special application.
HOW TO BUY SHARES
THE FUND'S SHARE PRICE, called net asset value (NAV), is calculated every
business day. The fund's shares are sold without a sales charge.
Shares are purchased at the next share price calculated after your
investment is received and accepted. Share price is normally calculated at
4 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application and
mail it along with your check. You may also open your account in person or
by wire as described on page . If there is no application accompanying this
prospectus, call 1-800-544-8888.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail in an application with a check, or
(small solid bullet) Open your account by exchanging from another Fidelity
fund.
IF YOU ARE INVESTING THROUGH A TAX-SHELTERED RETIREMENT PLAN, such as an
IRA, for the first time, you will need a special application. Retirement
investing also involves its own investment procedures. Call 1-800-544-8888
for more information and a retirement application.
If you buy shares by check or Fidelity Money Line(registered trademark),
and then sell those shares by any method other than by exchange to another
Fidelity fund, the payment may be delayed for up to seven business days to
ensure that your previous investment has cleared.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $2,500
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $500
TO ADD TO AN ACCOUNT $250
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $250
Through regular investment plans* $100
MINIMUM BALANCE $2,000
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $500
* FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO
"INVESTOR SERVICES," PAGE .
These minimums may vary for investments through Fidelity Portfolio Advisory
Services or a Fidelity Payroll Deduction Program account in the fund.
There is no minimum account balance or initial or subsequent investment
minimums for certain retirement accounts funded through salary reduction,
or accounts opened with the proceeds of distributions from such Fidelity
retirement accounts. Refer to the program materials for details.

<TABLE>
<CAPTION>
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TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
Mail (mail_graphic) (small solid bullet) Complete and sign the (small solid bullet) Make your check
application. Make your payable to "Fidelity
check payable to Asset Manager:
"Fidelity Asset Growth." Indicate your
Manager: Growth." Mail fund account number
to the address on your check and mail
indicated on to the address printed
the application. on your account
statement.
(small solid bullet) Exchange by mail: call
1-800-544-6666 for
instructions.

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
Wire (wire_graphic) (small solid bullet) Call 1-800-544-7777 to (small solid bullet) Not available for
set up your account retirement accounts.
and to arrange a wire (small solid bullet) Wire to:
transaction. Not Bankers Trust
available for retirement Company,
accounts. Bank Routing
(small solid bullet) Wire within 24 hours to: #021001033,
Bankers Trust Account #00163053.
Company, Specify "Fidelity Asset
Bank Routing Manager: Growth" and
#021001033, include your account
Account #00163053. number and your
Specify "Fidelity Asset name.
Manager: Growth" and
include your new
account number and
your name.

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118

</TABLE>

HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares. Your shares will be sold at
the next share price calculated after your order is received and accepted.
Share price is normally calculated at 4 p.m. Eastern time.
TO SELL SHARES IN A NON-RETIREMENT ACCOUNT, you may use any of the methods
described on these two pages.
TO SELL SHARES IN A FIDELITY RETIREMENT ACCOUNT, your request must be made
in writing, except for exchanges to other Fidelity funds, which can be
requested by phone or in writing. Call 1-800-544-6666 for a retirement
distribution form.
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).
TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE, you will need to sign
up for these services in advance.
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 redeem 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.
SELLING SHARES IN WRITING
Write a "letter of instruction" with:
(small solid bullet) Your name,
(small solid bullet) The fund's name,
(small solid bullet) Your fund account number,
(small solid bullet) The dollar amount or number of shares to be redeemed,
and
(small solid bullet) Any other applicable requirements listed in the table
that follows.
Unless otherwise instructed, Fidelity will send a check to the record
address. Deliver your letter to a Fidelity Investor Center, or mail it to:
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
ACCOUNT TYPE SPECIAL REQUIREMENTS

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118

</TABLE>

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

</TABLE>

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

</TABLE>

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

DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net income and capital gains
to shareholders each year. Normally, dividends and capital gains are
distributed in December.
DISTRIBUTION OPTIONS
When you open an account, specify on your application how you want to
receive your distributions. If the option you prefer is not listed on the
application, call 1-800-544-6666 for instructions. The fund offers four
options:
5. REINVESTMENT OPTION. Your dividend and capital gain 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.
6. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested, but you will be sent a check for each dividend
distribution.
7. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions.
8. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and
capital gain distributions will be automatically invested in another
identically registered Fidelity fund.
FOR RETIREMENT ACCOUNTS, all distributions are automatically reinvested.
When you are over 59 years old, you can receive distributions in cash.
When the fund deducts a distribution from its NAV, the reinvestment price
is the fund's NAV at the close of business that day. Cash distribution
checks will be mailed within seven days.
UNDERSTANDING
DISTRIBUTIONS
As a fund shareholder, you
are entitled to your share of
the fund's net income and
gains on its investments. The
fund passes its earnings
along to its investors as
DISTRIBUTIONS.
The fund earns dividends
from stocks and interest from
bond, money market, and
other investments. These are
passed along as DIVIDEND
DISTRIBUTIONS. The fund
realizes capital gains
whenever it sells securities
for a higher price than it paid
for them. These are passed
along as CAPITAL GAIN
DISTRIBUTIONS.
(checkmark)
TAXES
As with any investment, you should consider how your investment in the fund
will be taxed. If your account is not a tax-deferred retirement account,
you should be aware of these tax implications.
TAXES ON DISTRIBUTIONS. Distributions are subject to federal income tax,
and may also be subject to state or local taxes. If you live outside the
United States, your distributions could also be taxed by the country in
which you reside. Your distributions are taxable when they are paid,
whether you take them in cash or reinvest them. However, distributions
declared in December and paid in January are taxable as if they were paid
on December 31.
For federal tax purposes, the fund's income and short-term capital gain
distributions are taxed as dividends; long-term capital gain distributions
are taxed as long-term capital gains. Every January, Fidelity will send you
and the IRS a statement showing the taxable distributions paid to you in
the previous year.
TAXES ON TRANSACTIONS. Your redemptions - including exchanges to other
Fidelity funds - are subject to capital gains tax. A capital gain or loss
is the difference between the cost of your shares and the price you receive
when you sell them.
Whenever you sell shares of the fund, Fidelity will send you a confirmation
statement showing how many shares you sold and at what price. You will also
receive a consolidated transaction statement every January. However, it is
up to you or your tax preparer to determine whether this sale resulted in a
capital gain and, if so, the amount of tax to be paid. Be sure to keep your
regular account statements; the information they contain will be essential
in calculating the amount of your capital gains.
"BUYING A DIVIDEND." If you buy shares when the fund has realized but not
yet distributed income or capital gains, you will pay the full price for
the shares and then receive a portion of the price back in the form of a
taxable distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the fund
and its investments and these taxes generally will reduce the fund's
distributions. However, an offsetting tax credit or deduction may be
available to you. If so, your tax statement will show more taxable income
or capital gains than were actually distributed by the fund, but will also
show the amount of the available offsetting credit or deduction.
There are tax requirements that all funds must follow in order to avoid
federal taxation. In its effort to adhere to these requirements, the fund
may have to limit its investment activity in some types of instruments.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE)
is open. Fidelity normally calculates the fund's NAV as of the close of
business of the NYSE, normally 4 p.m. Eastern time.
THE FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and then dividing the result by the number of
shares outstanding.
The fund's assets are valued primarily on the basis of market quotations.
Foreign securities are valued on the basis of quotations from the primary
market in which they are traded, and are translated from the local currency
into U.S. dollars using current exchange rates. Short-term securities with
remaining maturities of sixty days or less for which quotations are not
readily available are valued on the basis of amortized cost. This method
minimizes the effect of changes in a security's market value. In addition,
if quotations are not readily available, or if the values have been
materially affected by events occurring after the closing of a foreign
market, assets may be valued by a method that the Board of Trustees
believes accurately reflects fair value.
THE FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION PRICE
(price to sell one share) are its NAV.
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require the fund to
withhold 31% of your taxable distributions and redemptions.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does not
follow reasonable procedures designed to verify the identity of the caller.
Fidelity will request personalized security codes or other information, and
may also record calls. You should verify the accuracy of your confirmation
statements immediately after you receive them. If you do not want the
ability to redeem and exchange by telephone, call Fidelity for
instructions.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods
of unusual market activity), consider placing your order by mail or by
visiting a Fidelity Investor Center.
THE FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. The fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they would
disrupt management of the fund.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your order will be processed at the
next offering price calculated after your order is received and accepted.
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) The fund 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
cancelled and you could be liable for any losses or fees the fund or its
transfer agent has incurred.
TO AVOID THE COLLECTION PERIOD associated with check and Money Line
purchases, consider buying shares by bank wire, U.S. Postal money order,
U.S. Treasury check, Federal Reserve check, or direct deposit instead.
CERTAIN FINANCIAL INSTITUTIONS that have entered into sales agreements with
FDC may enter confirmed purchase orders on behalf of customers by phone,
with payment to follow no later than the time when the fund is priced on
the following business day. If payment is not received by that time, the
financial institution could be held liable for resulting fees or losses.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your request is received and accepted. Note the
following:
(small solid bullet) Normally, redemption proceeds will be mailed to you on
the next business day, but if making immediate payment could adversely
affect the fund, it may take up to seven days to pay you.
(small solid bullet) Fidelity Money Line redemptions generally will be
credited to your bank account on the second or third business day after
your phone call.
(small solid bullet) The fund may hold payment on redemptions until it is
reasonably satisfied that investments made by check or Fidelity Money Line
have been collected, which can take up to seven business days.
(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.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of $12.00
from accounts with a value of less than $2,500, 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 the transfer agent, 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 in Fidelity exceed
$30,000. Eligibility for the $30,000 waiver is determined by
aggregating Fidelity accounts maintained by FSC 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 , you will be given 30
days' notice to reestablish the minimum balance. If you do not increase
your balance, Fidelity reserves the right to close your account and send
the proceeds to you. Your shares will be redeemed at the NAV on the day
your account is closed.
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
FDC may, at its own expense, provide promotional incentives to qualified
recipients who support the sale of shares of the fund without reimbursement
from the fund. Qualified recipients are securities dealers who have sold
fund shares or others, including banks and other financial institutions,
under special arrangements in connection with FDC's sales activities. In
some instances, these incentives may be offered only to certain
institutions whose representatives provide services in connection with the
sale or expected sale of significant amounts of shares.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging shares of the fund
for shares of other Fidelity funds. However, you should note the following:
(small solid bullet) The fund you are exchanging into must be available for
sale in your state.
(small solid bullet) You may only exchange 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) If you exchange into a fund with a sales charge, you
pay the percentage-point difference between that fund's sales charge and
any sales charge you have previously paid in connection with the shares you
are exchanging. For example, if you had already paid a sales charge of 2%
on your shares and you exchange them into a fund with a 3% sales charge,
you would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Because excessive trading can hurt fund performance
and shareholders, the fund reserves the right to temporarily or permanently
terminate the exchange privilege of any investor who makes more than four
exchanges out of the fund per calendar year. Accounts under common
ownership or control, including accounts with the same taxpayer
identification number, will be counted together for purposes of the four
exchange limit.
(small solid bullet) The exchange limit may be modified for accounts in
certain institutional retirement plans to conform to plan exchange limits
and Department of Labor regulations. See your plan materials for further
information.
(small solid bullet) The fund reserves the right to 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.
(small solid bullet) Your exchanges may be restricted or refused if the
fund receives or anticipates simultaneous orders affecting significant
portions of the fund's assets. In particular, a pattern of exchanges that
coincides with a "market timing" strategy may be disruptive to the fund.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any time. The
fund reserves the right to terminate or modify the exchange privilege in
the future.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50% on
exchanges. Check each fund's prospectus for details.
The Fidelity Pyramid and Logo, Fidelity Money Line, and Directed Dividends
are registered trademarks of FMR Corp. Fidelity Automatic Account Builder
and TouchTone Xpress are trademarks of FMR Corp.

This prospectus is printed on recycled paper using soy-based inks.

FIDELITY CHARLES STREET TRUST:
FIDELITY ASSET MANAGER

CROSS REFERENCE SHEET
FORM N-1A

ITEM NUMBER PROSPECTUS SECTION

<TABLE>
<CAPTION>
<S> <C> <C> <C>
1 .............................. Cover Page

2 a .............................. Expenses

b, c .............................. Contents; The Fund at a Glance; Who May Want
to Invest

3 a .............................. Financial Highlights

b .............................. *

c .............................. Performance

d .............................. Performance

4 a i............................. Charter

ii........................... The Fund at a Glance; Investment Principles and
Risks, Securities and Investment Practices

b .............................. Investment Principles and Risks, Securities and
Investment Practices

c .............................. Who May Want to Invest; Investment Principles
and Risks, Securities and Investment Practices

5 a .............................. Charter

b i............................. Cover Page; The Fund at a Glance; Charter; Doing
Business with Fidelity, FMR and Its Affiliates

ii........................... Charter, FMR and Its Affiliates

iii.......................... Expenses, Breakdown of Expenses

c .............................. Charter

d .............................. Charter; Breakdown of Expenses

e .............................. Cover Page; Charter

f .............................. Expenses

g i............................. Charter
.

ii............................ *
..

5A .............................. Performance

6 a i............................. Charter

ii........................... How to Buy Shares; How to Sell Shares;
Transaction Details; Exchange Restrictions

iii.......................... Charter

b ............................. Charter, FMR and Its Affiliates

c .............................. Transactions Details; Exchange Restrictions

d .............................. *

e .............................. Cover Page, Doing Business with Fidelity; How to
Buy Shares; How to Sell Shares; Investor Services

f, g .............................. Dividends, Capital Gains, and Taxes

7 a .............................. Cover Page; Charter

b .............................. Expenses; How to Buy Shares; Transaction Details

c .............................. *

d .............................. How to Buy Shares

e .............................. *

f .............................. Expenses, Breakdown of Expenses

8 .............................. How to Sell Shares; Investor Services; Transaction
Details; Exchange Restrictions

9 .............................. *

</TABLE>

* Not Applicable

(fund number 314 , trading symbol F ASMX )
This asset allocation fund seeks high total return with reduced risk over
the long term through investments in stocks, bonds and short-term and money
market instruments of all types.
FIDELITY
ASSET
MANAGER(trademark)
PROSPECTUS
FEBRUARY 17, 1997(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON, MA
02109

CONTENTS

KEY FACTS THE FUND AT A GLANCE

WHO MAY WANT TO INVEST

EXPENSES The fund's yearly
operating expenses.

FINANCIAL HIGHLIGHTS A summary
of the fund's financial data.

PERFORMANCE How the fund has
done over time.

THE FUND IN DETAIL CHARTER How the fund is
organized.

INVESTMENT PRINCIPLES AND RISKS
The fund's overall approach to
investing.

BREAKDOWN OF EXPENSES How
operating costs are calculated and
what they include.

YOUR ACCOUNT DOING BUSINESS WITH FIDELITY

TYPES OF ACCOUNTS Different
ways to set up your account,
including tax-sheltered retirement
plans.

HOW TO BUY SHARES Opening an
account and making additional
investments.

HOW TO SELL SHARES Taking money
out and closing your account.

INVESTOR SERVICES Services to
help you manage your account.

SHAREHOLDER AND DIVIDENDS, CAPITAL GAINS,
ACCOUNT POLICIES AND TAXES

TRANSACTION DETAILS Share price
calculations and the timing of
purchases and redemptions.

EXCHANGE RESTRICTIONS

KEY FACTS

THE FUND AT A GLANCE
GOAL: High total return with reduced risk over the long term. As with any
mutual fund, there is no assurance that the fund will achieve its goal.
STRATEGY: The fund diversifies across stocks, bonds and short-term and
money market instruments, both here and abroad, to pursue its goal. The
fund has a neutral mix which represents the way the fund's investments will
generally be allocated over the long term. This mix will vary over
short-term periods as fund management gradually adjusts the fund's holdings
- - within defined ranges - based on the current outlook for the different
markets.
Neutral Mix
Stocks 50%
(can range
from 30-70%)
Row: 1, Col: 1, Value: 10.0
Row: 1, Col: 2, Value: 50.0
Row: 1, Col: 3, Value: 40.0
Bonds 40%
(can range
from
20-60%)
Short-Term/M
oney Market
10%
(can range
from
0-50%)
MANAGEMENT: Fidelity Management & Research Company (FMR) is the management
arm of Fidelity Investments, which was established in 1946 and is now
America's largest mutual fund manager. Foreign affiliates of FMR may help
choose investments for the fund.
SIZE: As of September 30, 1996, the fund had over $10.6 billion in
assets.
WHO MAY WANT TO INVEST
The fund may be appropriate for investors who want to diversify among
domestic and foreign stocks, bonds and short-term and money market
instruments, and other types of securities in one fund. If you are looking
for a fund that can invest in a wide range of security types within defined
ranges in pursuit of high total return with reduced risk, this fund may be
appropriate for you.
Because the fund owns different types of investments, its performance is
affected by a variety of factors. The value of the fund's investments and
the income they generate will vary from day to day, and generally reflect
interest rates, market conditions, and other company, political, and
economic news. Performance also depends on FMR's skill in allocating
assets. When you sell your fund shares, they may be worth more or less than
what you paid for them.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or
sell shares of a fund. In addition, you may be charged an annual account
maintenance fee if your account balance falls below $2,500. See
"Transaction Details" page , for an explanation of how and when these
charges apply.
Maximum sales charge on purchases None
and reinvested distributions

Deferred sales charge on redemptions None

Exchange fee None

Annual account maintenance fee $12.0
(for accounts under $2,500) 0

ANNUAL FUND OPERATING EXPENSES are paid out of the fund's assets. The fund
pays a management fee to FMR. It also incurs other expenses for services
such as maintaining shareholder records and furnishing shareholder
statements and financial reports. The fund's expenses are factored into its
share price or dividends and are not charged directly to shareholder
accounts (see page ).
The following figures are based on historical expenses, adjusted
to reflect current fees, and are calculated as a percentage of average net
assets. A portion of the brokerage commissions that the fund pays is used
to reduce fund expenses. In addition, the fund has entered into an
arrangement with its transfer agent whereby interest earned on uninvested
cash balances is used to reduce transfer agent expenses. Including these
reductions, the total operating expenses presented in the table would have
been .81%.
Management fee .56
%*

12b-1 fee Non
e

Other expenses .27
%

Total fund operating expenses .83
%

*EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
.40% TO .25%. IF THIS AGREEMENT WERE NOT IN EFFECT, THE MANAGEMENT FEE AND
TOTAL OPERATING EXPENSES WOULD HAVE BEEN .71% AND .98% RESPECTIVELY.
EXAMPLES: Let's say, hypothetically, that the fund's annual return is 5%
and that its operating expenses are exactly as just described. For every
$1,000 you invested, here's how much you would pay in total expenses if you
close your account after the number of years indicated:
After 1 year $ 8

After 3 years $ 26

After 5 years $ 46

After 10 years $ 10
3

These examples illustrate the effect of expenses, but are not meant to
suggest actual or expected costs or returns, all of which may vary.

UNDERSTANDING
EXPENSES
Operating a mutual fund
involves a variety of
expenses for portfolio
management, shareholder
statements, tax reporting, and
other services. These costs
are paid from the fund's
assets; their effect is already
factored into any quoted
share price or return.
(checkmark)
FINANCIAL HIGHLIGHTS
The financial highlights table that follows has been audited by Price
Waterhouse LLP , independent accountants. The fund's financial
highlights, financial statements and reports of the auditor are included in
the fund's Annual Report, and are incorporated by reference into (are
legally a part of) the fund's SAI. Contact Fidelity for a free copy of the
Annual Report or the SAI.
SELECTED PER-SHARE DATA

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Years ended September
30 1996 1995 1994E 1993 1992 1991 1990 1989B

Net asset value,
beginning of $ 15.4 $ 14.5 $ 14.9 $ 13.5 $ 13.0 $ 10.6 $ 11.39 $ 10.0
period 7 8 7 0 2 4 0

Income from
Investment
Operations

Net investment
income .62 .49 .34 .52 .46 .55 .58 .27

Net realized
and .96 .93 .21 2.01 .97 2.48 (.71) 1.12
unrealized
gain (loss)

Total from
investment 1.58 1.42 .55 2.53 1.43 3.03 (.13) 1.39
operations

Less
Distributions

From net
investment (.56) (.44) (.44) (.87) (.45) (.65) (.38) --
income

From net
realized gain -- -- (.45) (.19) (.50) -- (.24) --

In excess of net
realized -- (.09) (.05) -- -- -- -- --
gain

Total
distributions (.56) (.53) (.94) (1.06) (.95) (.65) (.62) --

Net asset value,
end of $ 16.4 $ 15.4 $ 14.5 $ 14.9 $ 13.5 $ 13.0 $ 10.6 $ 11.39
period 9 7 8 7 0 2 4

Total return
C,D 10.37 10.09 3.60% 19.71 11.84 29.78 (1.27) 13.90
% % % % % % %

RATIOS AND SUPPLEMENTAL DATA

Net assets, end
of period (In $ 10,6 $ 11,08 $ 11,79 $ 7,26 $ 2,76 $ 743 $ 346 $ 245
millions) 74 4 2 6 2

Ratio of expenses to
average .95% .97% 1.04% 1.09% 1.17% 1.17% 1.17% 1.58%
net assets A

Ratio of
expenses to .93%F .97% 1.04% 1.09% 1.17% 1.17% 1.17% 1.58%
average net assets after A
expense reductions

Ratio of net
investment 3.64% 4.27% 3.63% 4.28% 5.58% 5.74% 5.89% 5.88%
income A
to average net assets

Portfolio turnover
rate 131% 137% 109% 98%

134% 134% 105% 167%
A

Average commission
rateG $ .004
5

</TABLE>

A ANNUALIZED
B FOR THE PERIOD DECEMBER 28, 1988 (COMMENCEMENT OF OPERATIONS) TO
SEPTEMBER 30, 1989.
C TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
D THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
E EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
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 FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
PERFORMANCE
Mutual fund performance is commonly measured as TOTAL RETURN. The total
returns that follow are based on historical fund results and do not reflect
the effect of taxes.
The fund's fiscal year runs from October 1 through September 30. The tables
below show the fund's performance over past fiscal years compared to
different measures, including a comparative index and a competitive funds
average. The chart on page presents calendar year performance.
AVERAGE ANNUAL TOTAL RETURNS
Fiscal periods ended Pas Past Life
September 30, 1996 t 1 5 of
yea year fund
r s A

Asset Manager 10.37 11.00 12.29
% % %

S&P 500 (registered trademark) 20.33 15.23 15.84
% % %

Lipper Flexible 12.33 11.19 n/a
Portfolio Funds % %
Average

<TABLE>
<CAPTION>
<S> <C> <C> <C>
CUMULATIVE TOTAL RETURNS
Fiscal periods ended Pas Past Life
September 30, 1996 t 1 5 of
yea year fund
r s A

Asset Manager 10.37 68.54 145.97
% % %

S&P 500 20.33 103.1 213.19
% 8 % %

Lipper Flexible Portfolio Funds Average

12.33 71.56 n/a
% %

</TABLE>

A FROM DECEMBER 28, 1988 (COMMENCEMENT OF OPERATIONS)
EXAMPLE: Let's say, hypothetically, that you had $10,000 invested in the
fund on December 28, 1988. From that date through September 30, 1996,
t he fund's total return was 145.97%. Your $10,000 would have grown to
$24,597 (the initial investment plus 145.97% of $10,000).
UNDERSTANDING
PERFORMANCE
As economic conditions
change, different types of
investments do better than
others. Since this asset
allocation fund invests in
domestic and foreign stocks,
bonds, and short-term
instruments, its total return
will reflect the performance of
both domestic and foreign
markets and short and long
term interest rates depending
on the mix of securities it
owns.
(checkmark)
$10,000 OVER LIFE OF FUND
Fiscal periods 1988 1993
1996
Row: 1, Col: 1, Value: 10000.0
Row: 2, Col: 1, Value: 10030.0
Row: 3, Col: 1, Value: 10410.0
Row: 4, Col: 1, Value: 10250.0
Row: 5, Col: 1, Value: 10340.0
Row: 6, Col: 1, Value: 10610.0
Row: 7, Col: 1, Value: 10920.0
Row: 8, Col: 1, Value: 11040.0
Row: 9, Col: 1, Value: 11360.0
Row: 10, Col: 1, Value: 11390.0
Row: 11, Col: 1, Value: 11390.0
Row: 12, Col: 1, Value: 11440.0
Row: 13, Col: 1, Value: 11520.0
Row: 14, Col: 1, Value: 11562.28
Row: 15, Col: 1, Value: 11192.37
Row: 16, Col: 1, Value: 11276.92
Row: 17, Col: 1, Value: 11393.17
Row: 18, Col: 1, Value: 11202.94
Row: 19, Col: 1, Value: 11794.79
Row: 20, Col: 1, Value: 11889.91
Row: 21, Col: 1, Value: 11879.34
Row: 22, Col: 1, Value: 11477.72
Row: 23, Col: 1, Value: 11245.21
Row: 24, Col: 1, Value: 11276.92
Row: 25, Col: 1, Value: 11815.93
Row: 26, Col: 1, Value: 12184.23
Row: 27, Col: 1, Value: 12834.35
Row: 28, Col: 1, Value: 13394.81
Row: 29, Col: 1, Value: 13618.99
Row: 30, Col: 1, Value: 13831.96
Row: 31, Col: 1, Value: 14179.44
Row: 32, Col: 1, Value: 13876.79
Row: 33, Col: 1, Value: 14246.69
Row: 34, Col: 1, Value: 14571.76
Row: 35, Col: 1, Value: 14594.17
Row: 36, Col: 1, Value: 14706.26
Row: 37, Col: 1, Value: 14448.46
Row: 38, Col: 1, Value: 15064.82
Row: 39, Col: 1, Value: 15282.45
Row: 40, Col: 1, Value: 15572.63
Row: 41, Col: 1, Value: 15572.63
Row: 42, Col: 1, Value: 15790.26
Row: 43, Col: 1, Value: 15947.43
Row: 44, Col: 1, Value: 15947.43
Row: 45, Col: 1, Value: 16273.88
Row: 46, Col: 1, Value: 16201.33
Row: 47, Col: 1, Value: 16322.24
Row: 48, Col: 1, Value: 16298.06
Row: 49, Col: 1, Value: 16660.78
Row: 50, Col: 1, Value: 16984.94
Row: 51, Col: 1, Value: 17277.13
Row: 52, Col: 1, Value: 17454.98
Row: 53, Col: 1, Value: 18029.64
Row: 54, Col: 1, Value: 18106.58
Row: 55, Col: 1, Value: 18491.28
Row: 56, Col: 1, Value: 18724.08
Row: 57, Col: 1, Value: 19008.76
Row: 58, Col: 1, Value: 19552.24
Row: 59, Col: 1, Value: 19539.98
Row: 60, Col: 1, Value: 20144.3
Row: 61, Col: 1, Value: 20075.14
Row: 62, Col: 1, Value: 20940.46
Row: 63, Col: 1, Value: 21620.35
Row: 64, Col: 1, Value: 20940.46
Row: 65, Col: 1, Value: 19927.45
Row: 66, Col: 1, Value: 19913.73
Row: 67, Col: 1, Value: 20078.31
Row: 68, Col: 1, Value: 19636.47
Row: 69, Col: 1, Value: 20022.86
Row: 70, Col: 1, Value: 20492.03
Row: 71, Col: 1, Value: 20243.05
Row: 72, Col: 1, Value: 20340.24
Row: 73, Col: 1, Value: 20034.79
Row: 74, Col: 1, Value: 19558.09
Row: 75, Col: 1, Value: 19402.53
Row: 76, Col: 1, Value: 19699.51
Row: 77, Col: 1, Value: 20013.12
Row: 78, Col: 1, Value: 20425.91
Row: 79, Col: 1, Value: 20909.87
Row: 80, Col: 1, Value: 21196.75
Row: 81, Col: 1, Value: 21783.96
Row: 82, Col: 1, Value: 21927.18
Row: 83, Col: 1, Value: 22285.82
Row: 84, Col: 1, Value: 22213.79
Row: 85, Col: 1, Value: 22631.56
Row: 86, Col: 1, Value: 23109.04
Row: 87, Col: 1, Value: 23604.75
Row: 88, Col: 1, Value: 23488.12
Row: 89, Col: 1, Value: 23489.33
Row: 90, Col: 1, Value: 23694.86
Row: 91, Col: 1, Value: 23944.43
Row: 92, Col: 1, Value: 24078.1
Row: 93, Col: 1, Value: 23619.33
Row: 94, Col: 1, Value: 23767.32
Row: 95, Col: 1, Value: 24596.65
Row: 96, Col: 1, Value: 0.0
$
$24,597
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment over a given period,
assuming reinvestment of any dividends and capital gains. A CUMULATIVE
TOTAL RETURN reflects actual performance over a stated period of time. An
AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that, if
achieved annually, would have produced the same cumulative total return if
performance had been constant over the entire period. Average annual total
returns smooth out variations in performance; they are not the same as
actual year-by-year results.
YEAR-BY-YEAR TOTAL RETURNS
Calendar years 1989 1990 1991 1992 1993 1994 1995
ASSET MANAGER 15.28% 5.38% 23.64% 12.75% 23.29% -6.60
% 18.16%
Lipper Flexible Portfolio Funds Average 17.89 % -0.70 %
26.56 % 7.5
1 % 11.94 % -2.65 % 25.08 %
S&P 500 31.69% -3.10% 30.47% 7.62% 10.08% 1.32
% 37.58%
Consumer Price Index 4.65% 6.11% 3.06% 2.90% 2.75% 2.67% 2.54
%
Percentage (%)
Row: 1, Col: 1, Value: 0.0
Row: 2, Col: 1, Value: 0.0
Row: 3, Col: 1, Value: 0.0
Row: 4, Col: 1, Value: 15.28
Row: 5, Col: 1, Value: 5.38
Row: 6, Col: 1, Value: 23.64
Row: 7, Col: 1, Value: 12.75
Row: 8, Col: 1, Value: 23.29
Row: 9, Col: 1, Value: -6.6
Row: 10, Col: 1, Value: 18.16
(LARGE SOLID BOX) Asset
Manager
YIELD refers to the income generated by an investment in the fund over a
given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all stock and bond
funds. Because this differs from other accounting methods, the quoted yield
may not equal the income actually paid to shareholders.
THE STANDARD & POOR'S 500 INDEX (S&P 500(registered trademark)) is a widely
recognized, unmanaged index of common stocks.
Unlike the fund's returns, the total returns of the comparative index do
not include the effect of any brokerage commissions, transaction fees, or
other costs of investing.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government.
THE COMPETITIVE FUNDS AVERAGE is the Lipper Flexible Portfolio Funds
Average, which currently reflects the performance of over 150 mutual funds
with similar investment objectives. This average, published by Lipper
Analytical Services, Inc., excludes the effect of sales charges.
Other illustrations of fund performance may show moving averages over
specified periods.
The fund's recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders. For
current performance or a free annual report, call 1-800-544-8888.
TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN
INDICATION OF FUTURE PERFORMANCE.
THE FUND IN DETAIL

CHARTER
ASSET MANAGER IS A MUTUAL FUND: an investment that pools shareholders'
money and invests it toward a specified goal. The fund is a diversified
fund of Fidelity Charles Street Trust, an open-end management investment
company organized as a Massachusetts business trust on July 7, 1981.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the fund's activities,
review contractual arrangements with companies that provide services to the
fund, and review the fund's performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These meetings
may be called to elect or remove trustees, change fundamental policies,
approve a management contract, or for other purposes. Shareholders not
attending these meetings are encouraged to vote by proxy. Fidelity will
mail proxy materials in advance, including a voting card and information
about the proposals to be voted on. The number of votes you are entitled to
is based upon the dollar value of your investment.
FMR AND ITS AFFILIATES
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs. Fidelity Management & Research (U.K.) Inc.
(FMR U.K.), in London, England, and Fidelity Management & Research (Far
East) Inc. (FMR Far East), in Tokyo, Japan, assist FMR with foreign
investments.
Richard Habermann is vice president and lead manager of Asset Manager,
which he has managed since March 1996. He also manages several other
Fidelity funds. Previously, Mr. Habermann was chief investment officer for
Fidelity International, Ltd., from 1991 to 1993, and division head for
international equities and director of international research, from 1993 to
1996. Mr. Habermann joined Fidelity in 1968.
George Vanderheiden is vice president of Asset Manager and manager of its
equity investments, which he has managed since March 1996. He also manages
several other Fidelity funds. Mr. Vanderheiden joined Fidelity in 1971.
Charles Morrison is manager of Asset Manager's fixed-income
investments, which he has managed since February 199 7 . He
also manages several other Fidelity funds. Mr. Morrison joined
Fidelity in 198 7 .
John Todd is vice president of Asset Manager and manager of its short-term
money market investments, which he has managed since December 1996. He also
manages several other Fidelity funds. Mr. Todd joined Fidelity in 1981.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation (FDC) distributes and markets Fidelity's
funds and services. Fidelity Service Co mpany, Inc . (FSC) performs
transfer agent servicing functions for the fund.
FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far
East. Members of the Edward C. Johnson 3d family are the predominant owners
of a class of shares of common stock representing approximately 49% of the
voting power of FMR Corp. Under the Investment Company Act of 1940 (the
1940 Act), control of a company is presumed where one individual or group
of individuals owns more than 25% of the voting stock of that company;
therefore, the Johnson family may be deemed under the 1940 Act to form a
controlling group with respect to FMR Corp.
A broker-dealer may use a portion of the commissions paid by the funds
to reduce custodian or transfer agent fees for the fund. FMR may use its
broker-dealer affiliates and other firms that sell fund shares to carry out
the fund's transactions, provided that the fund receives brokerage services
and commission rates comparable to those of other broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
THE FUND'S INVESTMENT APPROACH
The fund seeks high total return with reduced risk over the long term by
allocating its assets among stocks, bonds, short-term and money market
instruments, and other instruments of U.S. and foreign issuers.
The fund allocates its assets among the following classes, or types, of
investments. The STOCK CLASS includes equity securities of all types. The
BOND CLASS includes all varieties of fixed-income securities maturing in
more than one year. The SHORT-TERM/MONEY MARKET CLASS includes all types of
short-term and money market instruments. FMR may use its judgment to place
a security in the most appropriate class based on its investment
characteristics. Fixed-income securities may be classified in the bond or
short-term/money market class according to interest rate sensitivity as
well as maturity. The fund may also make other investments that do not fall
within these classes.
FMR has the ability to allocate the fund's assets within specified ranges.
The fund's NEUTRAL MIX represents the benchmark for its combination of
investments in each asset class over time. FMR may change the neutral mix
from time to time. The range and approximate neutral mix for each asset
class are shown below.
Range Neutral Mix
STOCK CLASS 30 - 70% 50%
BOND CLASS 20 - 60% 40%
SHORT-TERM/
MONEY MARKET CLASS 0 - 50% 10%
Asset Manager's approach spreads the fund's assets among all three classes,
moderating both the risk and return potential of stocks, bonds and
short-term and money market instruments.
Since the fund is subject to the risks of each investment type, the fund
and its performance are affected by many factors. Stock values fluctuate in
response to the activities of individual companies and general market and
economic conditions. The value of bonds and short-term instruments
fluctuates based on changes in interest rates and in the credit quality of
the issuer. FMR may use various investment techniques to hedge a portion of
the fund's risks, but there is no guarantee that these strategies will work
as FMR intends. When you sell your shares, they may be worth more or less
than what you paid for them.
In pursuit of the fund's objective, FMR will not try to pinpoint the
precise moment when a major reallocation should be made. Instead, FMR
regularly reviews the fund's allocations and makes changes gradually to
favor investments that it believes will provide the most favorable outlook
for achieving the fund's objective. Under normal circumstances, a single
reallocation will not involve more than 10% of the fund's total assets.
Although FMR uses its expertise and resources in allocating assets, FMR's
decisions may not be advantageous to the fund.
FMR normally invests the fund's assets according to its investment
strategy. The fund also reserves the right to invest without limitation in
preferred stocks and investment-grade debt instruments for temporary,
defensive purposes.
The fund diversifies across investment types more than most mutual funds.
No one mutual fund, however, can provide an appropriate balanced investment
plan for all investors.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies FMR may employ in
pursuit of the fund's investment objective, and a summary of related risks.
Any restrictions listed supplement those discussed earlier in this section.
A complete listing of the fund's limitations and more detailed information
about the fund's investments are contained in the fund's SAI. Policies and
limitations are considered at the time of purchase; the sale of instruments
is not required in the event of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques
unless it believes that they are consistent with the fund's investment
objective and policies and that doing so will help the fund achieve its
goal. Fund holdings and recent investment strategies are detailed in the
fund's financial reports, which are sent to shareholders twice a year. For
a free SAI or financial report, call 1-800-544-8888.
EQUITY SECURITIES may include common stocks and warrants. Common stocks,
the most familiar type, represent an equity (ownership) interest in a
corporation. Although equity securities have a history of long-term growth
in value, their prices fluctuate based on changes in a company's financial
condition and on overall market and economic conditions. Smaller companies
are especially sensitive to these factors.
RESTRICTIONS: With respect to 75% of total assets, the fund may not
purchase more than 10% of the outstanding voting securities of a single
issuer.
DEBT SECURITIES. Bonds and other debt instruments are used by issuers to
borrow money from investors. The issuer generally pays the investor
a fixed , variable , or floating rate of interest, and must
repay the amount borrowed at maturity. Some debt securities, such as zero
coupon bonds, do not pay current interest, but are sold at a
discount from their face values. Debt securities have varying levels of
sensitivity to changes in interest rates and varying degrees of credit
quality. In general, bond prices rise when interest rates fall, and fall
when interest rates rise. Longer-term bonds and zero coupon bonds
are generally more sensitive to interest rate changes .
Lower-quality debt securities (sometimes called "junk bonds") are
considered to have speculative characteristics, and involve greater risk of
default or price changes due to changes in the issuer's creditworthiness,
or they may already be in default. The market prices of these securities
may fluctuate more than higher-quality securities and may decline
significantly in periods of general economic difficulty.
The following table provides a summary of ratings assigned to debt holdings
(not including money market instruments) in the fund's portfolio. These
figures are dollar-weighted averages of month-end portfolio holdings during
fiscal 1996, and are presented as a percentage of total security
investments. These percentages are historical and do not necessarily
indicate the fund's current or future debt holdings.
FISCAL YEAR ENDED SEPTEMBER 1996 DEBT HOLDINGS, BY RATING
MOODY'S INVESTORS SERVICE STANDARD & POOR'S

(AS A % OF INVESTMENTS) (AS A % OF
INVESTMENTS)
Rating Average Rating Average
INVESTMENT GRADE*

Highest quality Aaa 26.0% AAA 25.8%

High quality Aa 0.1% AA 0.3%

Upper-medium grade A 1.0% A 0.7%

Medium grade Baa 0.6% BBB 1.2%
LOWER QUALITY*

Moderately speculative Ba 1.6% BB 1.5%

Speculative B 2.9% B 2.2%

Highly speculative Caa 0.3% CCC 0.2%

Poor quality Ca 0.0% CC 0.0%

Lowest quality, no interest C C

In default, in arrears -- 0.0% D 0.0%

32.5% 31.9%
(AS A % OF INVESTMENTS)
SECURITIES NOT RATED BY MOODY'S OR S&P(dagger)

Investment Grade (double dagger) 0.7%

Lower Quality (double dagger) 0.4%

Total 1.1%
* FOR SOME FOREIGN GOVERNMENT OBLIGATIONS, FMR ASSIGNS THE RATINGS OF THE
SOVEREIGN CREDIT OF THE ISSUING GOVERNMENT.
(dagger) THE DOLLAR-WEIGHTED AVERAGE PERCENTAGES REFLECTED IN THE TABLE MAY
INCLUDE SECURITIES RATED BY OTHER NATIONALLY RECOGNIZED RATING SERVICES, AS
WELL AS UNRATED SECURITIES.
(double dagger) AS DETERMINED BY FMR

RESTRICTIONS: Purchase of a debt security is consistent with the fund's
debt quality policy if it is rated at or above the stated level by Moody's
Investors Service, Standard & Poor's, Duff & Phelps Credit Rating Co., or
Fitch Investors Service, L.P., or is unrated but judged to be of equivalent
quality by FMR. The fund currently intends to limit its investments in
lower than Baa-quality debt securities to less than 35% of its assets.
MONEY MARKET SECURITIES are high-quality, short-term instruments issued by
the U.S. Government, corporations, financial institutions, and other
entities. These securities may carry fixed, variable, or floating interest
rates.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and
securities issued by U.S. entities with substantial foreign operations may
involve additional risks and considerations. These include risks relating
to political or economic conditions in foreign countries, fluctuations in
foreign currencies, withholding or other taxes, operational risks,
increased regulatory burdens, and the potentially less stringent investor
protection and disclosure standards of foreign markets. 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. All of these factors can make foreign
investments, especially those in developing countries, more volatile than
U.S. investments.
ASSET-BACKED AND MORTGAGE SECURITIES include interests in pools of
lower-rated debt securities, consumer loans or mortgages, or complex
instruments such as collateralized mortgage obligations and stripped
mortgage-backed securities. The value of these securities may be
significantly affected by changes in interest rates, the market's
perception of issuers, and the creditworthiness of the parties involved.
Some securities may have a structure that makes their reaction to interest
rates and other factors difficult to predict, making their value highly
volatile. These securities may also be subject to prepayment risk.
STRIPPED SECURITIES are the separate income or principal components of a
debt security. The risks associated with stripped securities are similar to
those of other debt securities, although stripped securities may be more
volatile and the value of certain types of stripped securities may move in
the same direction as interest rates. U.S. Treasury securities that have
been stripped by a Federal Reserve Bank are obligations issued by the U.S.
Treasury.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a security
at one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices, interest
rates, currency exchange rates, commodity prices, or other factors that
affect security values. These techniques may involve derivative
transactions such as buying and selling options and futures contracts,
entering into currency exchange contracts or swap agreements, purchasing
indexed securities, and selling securities short.
FMR can use these practices to adjust the risk and return characteristics
of the fund's portfolio of investments. If FMR judges market conditions
incorrectly or employs a strategy that does not correlate well with the
fund's investments, these techniques could result in a loss, regardless of
whether the intent was to reduce risk or increase return. These techniques
may increase the volatility of the fund and may involve a small investment
of cash relative to the magnitude of the risk assumed. In addition, these
techniques could result in a loss if the counterparty to the transaction
does not perform as promised.
DIRECT DEBT. Loans and other direct debt instruments are interests in
amounts owed to another party by a company, government, or other borrower.
They have additional risks beyond conventional debt securities because they
may entail less legal protection for the fund, or there may be a
requirement that the fund supply additional cash to a borrower on demand.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by
FMR, under the supervision of the Board of Trustees, to be illiquid, which
means that they may be difficult to sell promptly at an acceptable price.
The sale of some illiquid securities, and some other securities, may be
subject to legal restrictions. Difficulty in selling securities may
result in a loss or may be costly to the fund.
RESTRICTIONS: The fund may not purchase a security if, as a result, more
than 10% of its assets would be invested in illiquid securities.
WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS are trading practices in
which payment and delivery for the securities take place at a future date.
The market value of a security could change during this period.
OTHER INSTRUMENTS may include convertible securities, preferred stocks,
securities of closed-end investment companies and real estate-related
instruments.
CASH MANAGEMENT. The fund may invest in money market securities, in
repurchase agreements, and in a money market fund available only to funds
and accounts managed by FMR or its affiliates, whose goal is to seek a high
level of current income while maintaining a stable $1.00 share price. A
major change in interest rates or a default on the money market fund's
investments could cause its share price to change.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry.
RESTRICTIONS: With respect to 75% of its total assets, the fund may not
purchase a security if, as a result, more than 5% would be invested in the
securities of any issuer. This limitation does not apply to U.S.
Government securities.
The fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government securities.
BORROWING. The fund may borrow from banks or from other funds advised by
FMR, or through reverse repurchase agreements. If the fund borrows money,
its share price may be subject to greater fluctuation until the borrowing
is paid off. If the fund makes additional investments while borrowings are
outstanding, this may be considered a form of leverage.
RESTRICTIONS: The fund may borrow only for temporary or emergency purposes,
but not in an amount exceeding 331/3% of its total assets.
LENDING securities to broker-dealers and institutions, including Fidelity
Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a means of earning
income. This practice could result in a loss or a delay in recovering the
fund's securities. The fund may also lend money to other funds advised by
FMR.
RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of the fund's
total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
The fund seeks high total return with reduced risk over the long term by
allocating its assets among stocks, bonds, and short-term instruments.
With respect to 75% of its total assets, the fund may not purchase a
security if, as a result, more than 5% would be invested in the securities
of any issuer and may not purchase more than 10% of the outstanding voting
securities of a single issuer.
The fund may not invest more than 25% of its total assets in any one
industry.
The fund may borrow only for temporary or emergency purposes, but not in an
amount exceeding 33% of its total assets.
Loans, in the aggregate, may not exceed 33% of the fund's total assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily operations.
Expenses paid out of the fund's assets are reflected in its share price or
dividends; they are neither billed directly to shareholders nor deducted
from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to affiliates who provide
assistance with these services. The fund also pays OTHER EXPENSES, which
are explained on page .
FMR may, from time to time, agree to reimburse the fund for management fees
and other expenses above a specified limit. FMR retains the ability to be
repaid by the fund if expenses fall below the specified limit prior to the
end of the fiscal year. Reimbursement arrangements, which may be terminated
at any time without notice, can decrease the fund's expenses and boost its
performance.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fee is
calculated by adding a group fee rate to an individual fund fee rate, and
multiplying the result by the fund's average net assets.
The group fee rate is based on the average net assets of all the mutual
funds advised by FMR. This rate cannot rise above .52%, and it drops as
total assets under management increase.
F or September 1996, the group fee rate was .3050%. The indivi dual
fund fee rate is .25%. The total management fee rate for the fiscal year
ended1996 was .68%. Effective August 1, 1996, FMR voluntarily agreed
to reduce the fund's individual fund fee rate from .40% to .25%. If this
reduction were not in effect, the total management fee rate would have been
.71% for the fiscal year ended 1996.

UNDERSTANDING THE
MANAGEMENT FEE
The management fee FMR
receives is designed to be
responsive to changes in
FMR's total assets under
management. Building this
variable into the fee
calculation assures
shareholders that they will
pay a lower rate as FMR's
assets under management
increase.
(checkmark)
FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These
sub-advisers provide FMR with investment research and advice on issuers
based outside the United States. Under the sub-advisory agreements, FMR
pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively,
of the costs of providing these services.
The sub-advisers may also provide investment management services. In
return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its
management fee rate with respect to the fund's investments that the
sub-adviser manages on a discretionary basis.
OTHER EXPENSES
While the management fee is a significant component of the fund's annual
operating costs, the fund has other expenses as well.
The fund contracts with FSC to perform many transaction and accounting
functions. These services include processing shareholder transactions,
valuing the fund's investments, and handling securities loans. For the
fiscal year ended 1996, the fund paid FSC fees equal to .24 %
of its average net assets.
The fund also pays other expenses, such as legal, audit, and custodian
fees; proxy solicitation costs; and the compensation of trustees who are
not affiliated with Fidelity. A broker-dealer may use a portion of the
commissions paid by the fund to reduce the fund's custodian or transfer
agent fees.
The fund has adopted a Distribution and Service Plan. This plan recognizes
that FMR may use its resources, including management fees, to pay expenses
associated with the sale of fund shares. This may include payments to third
parties, such as banks or broker-dealers, that provide shareholder support
services or engage in the sale of the fund's shares. It is important to
note, however, that the fund does not pay FMR any separate fees for this
service.
The fun d's portfolio turnover rate for the fiscal year ended September
1996 was 131 %. This rate varies from year to year. High turnover rates
increase transaction costs and may increase taxable capital gains. FMR
considers these effects when evaluating the anticipated benefits of
short-term investing.
YOUR ACCOUNT

DOING BUSINESS WITH FIDELITY
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, FBSI. Fidelity is also a leader
in providing tax-sheltered retirement plans for individuals investing on
their own or through their employer.
Fidelity is committed to providing investors with practical information to
make investment decisions. Based in Boston, Fidelity provides customers
with complete service 24 hours a day, 365 days a year, through a network of
telephone service centers around the country.
To reach Fidelity for general information, call these numbers:
(small solid bullet) For mutual funds, 1-800-544-8888
(small solid bullet) For brokerage, 1-800-544-7272
If you would prefer to speak with a representative in person, Fidelity has
over 80 walk-in Investor Centers across the country.
TYPES OF ACCOUNTS
You may set up an account directly in the fund or, if you own or intend to
purchase individual securities as part of your total investment portfolio,
you may consider investing in the fund through a brokerage account.
You may purchase or sell shares of the fund through an investment
professional, including a broker, who may charge you a transaction fee for
this service. If you invest through FBSI, another financial institution, or
an investment professional, read their program materials for any special
provisions, additional service features or fees that may apply to your
investment in the fund. Certain features of the fund, such as the minimum
initial or subsequent investment a mounts, may be modified.
The different ways to set up (register) your account with Fidelity are
listed in the table that follows.
The account guidelines that follow may not apply to certain retirement
accounts. If you are investing through a retirement account or if your
employer offers the fund through a retirement program, you may be subject
to additional fees. For more information, please refer to your program
materials, contact your employer or call your retirement benefits number or
Fidelity directly, as appropriate.
FIDELITY FACTS
Fidelity offers the broadest
selection of mutual funds
in the world.
(solid bullet) Number of Fidelity mutual
funds: over 2 2 5
(solid bullet) Assets in Fidelity mutual
funds: over $4 32 billion
(solid bullet) Number of shareholder
accounts: over 2 9 million
(solid bullet) Number of investment
analysts and portfolio
managers: over 2 70
(checkmark)
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have two or
more owners (tenants).
RETIREMENT
TO SHELTER YOUR RETIREMENT SAVINGS FROM TAXES
Retirement plans allow individuals to shelter investment income and
capital gains from current taxes. In addition, contributions to these
accounts may be tax deductible. Retirement accounts require special
applications and typically have lower minimums.
(solid bullet) INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow anyone of legal
age and under 70 with earned income to invest up to $2,000 per tax year.
Individuals can also invest in a spouse's IRA if the spouse has earned
income of less than $250.
(solid bullet) ROLLOVER IRAS retain special tax advantages for certain
distributions from employer-sponsored retirement plans.
(solid bullet) KEOGH OR CORPORATE PROFIT SHARING AND MONEY PURCHASE PENSION
PLANS allow self-employed individuals or small business owners (and their
employees) to make tax-deductible contributions for themselves and any
eligible employees up to $30,000 per year.
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide small
business owners or those with self-employed income (and their eligible
employees) with many of the same advantages as a Keogh, but with fewer
administrative requirements.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are available to employees of most
tax-exempt institutions, including schools, hospitals, and other charitable
organizations.
(solid bullet) 401(K) PROGRAMS allow employees of corporations of all sizes
to contribute a percentage of their wages on a tax-deferred basis. These
accounts need to be established by the trustee of the plan.
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and obtain
tax benefits. An individual can give up to $10,000 a year per child without
paying federal gift tax. Depending on state laws, you can set up a
custodial account under the Uniform Gifts to Minors Act (UGMA) or the
Uniform Transfers to Minors Act (UTMA).
TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS
Requires a special application.
HOW TO BUY SHARES
THE FUND'S SHARE PRICE, called net asset value (NAV), is calculated every
business day. The fund's shares are sold without a sales charge.
Shares are purchased at the next share price calculated after your
investment is received and accepted. Share price is normally calculated at
4 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application and
mail it along with your check. You may also open your account in person or
by wire as described on page . If there is no application accompanying this
prospectus, call 1-800-544-8888.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail in an application with a check, or
(small solid bullet) Open your account by exchanging from another Fidelity
fund.
IF YOU ARE INVESTING THROUGH A TAX-SHELTERED RETIREMENT PLAN, such as an
IRA, for the first time, you will need a special application. Retirement
investing also involves its own investment procedures. Call 1-800-544-8888
for more information and a retirement application.
If you buy shares by check or Fidelity Money Line(registered trademark),
and then sell those shares by any method other than by exchange to another
Fidelity fund, the payment may be delayed for up to seven business days to
ensure that your previous investment has cleared.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $2,500
For Fidelity IRA, Rollover IRA,
SEP-IRA and Keogh accounts $500
TO ADD TO AN ACCOUNT $250
For Fidelity IRA, Rollover IRA,
SEP-IRA and Keogh accounts $250
Through regular investment plans* $100
MINIMUM BALANCE $ 2 ,000
For Fidelity IRA, Rollover IRA,
SEP-IRA and Keogh accounts $500
* FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO
"INVESTOR SERVICES," ON PAGE .
These minimums may vary for investments through Fidelity Portfolio Advisory
Services, a Fidelity Investor Card account, a Fidelity College Savings Plan
account, or a Fidelity Payroll Deduction Program account in the fund.
There is no minimum account balance or initial or subsequent investment
minimums for certain retirement accounts funded through salary reduction,
or accounts opened with the proceeds of distributions from such Fidelity
retirement accounts. Refer to the program materials for details.

<TABLE>
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TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
Mail (mail_graphic) (small solid bullet) Complete and sign the (small solid bullet) Make your check
application. Make your payable to "Fidelity
check payable to Asset Manager."
"Fidelity Asset Indicate your fund
Manager." Mail to the account number on
address indicated on your check and mail to
the application. the address printed on
your account statement.
(small solid bullet) Exchange by mail: call
1-800-544-6666 for
instructions.

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
Wire (wire_graphic) (small solid bullet) Call 1-800-544-7777 to (small solid bullet) Not available for
set up your account retirement accounts.
and to arrange a wire (small solid bullet) Wire to:
transaction. Not Bankers Trust
available for retirement Company,
accounts. Bank Routing
(small solid bullet) Wire within 24 hours to: #021001033,
Bankers Trust Account #00163053.
Company, Specify "Fidelity Asset
Bank Routing Manager" and include
#021001033, your account number
Account #00163053. and your name.
Specify "Fidelity Asset
Manager" and include
your new account
number and your
name.

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118

</TABLE>

Wire (wire_graphic) All account types (small solid bullet) You must sign up for the wire
except retirement feature before using it. To
verify that it is in place, call
1-800-544-6666. Minimum
wire: $5,000.
(small solid bullet) Your wire redemption request
must be received by Fidelity
before 4 p.m. Eastern time
for money to be wired on the
next business day.

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118

</TABLE>

24-HOUR SERVICE
ACCOUNT ASSISTANCE
1-800-544-6666
ACCOUNT TRANSACTIONS
1-800-544-7777
PRODUCT INFORMATION
1-800-544-8888
RETIREMENT ACCOUNT
ASSISTANCE
1-800-544-4774
TOUCHTONE XPRESSSM
1-800-544-5555
AUTOMATED SERVICE
(checkmark)
To reduce expenses, only one copy of most financial reports and
prospectuses will be mailed to your household, even if you have more than
one account in the fund. Call 1-800-544-6666 if you need copies of
financial reports, prospectuses, or historical account information.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of other
Fidelity funds by telephone or in writing.
Note that exchanges out of the fund are limited to four per calendar year,
and that they may have tax consequences for you. For details on policies
and restrictions governing exchanges, including circumstances under which a
shareholder's exchange privilege may be suspended or revoked, see page .
SYSTEMATIC WITHDRAWAL PLANS let you set up periodic redemptions from your
account.
FIDELITY MONEY LINE enables you to transfer money by phone between your
bank account and your fund account. Most transfers are complete within
three business days of your call.
REGULAR INVESTMENT PLANS
One easy way to pursue your financial goals is to invest money regularly.
Fidelity offers convenient services that let you transfer money into your
fund account, or between fund accounts, automatically. While regular
investment plans 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. Certain restrictions apply for retirement accounts. Call
1-800-544-6666 for more information.
REGULAR INVESTMENT PLANS
FIDELITY AUTOMATIC ACCOUNT BUILDERSM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY FUND

</TABLE>

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

</TABLE>

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

</TABLE>

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

DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net income and capital gains
to shareholders each year. Normally, dividends are distributed in March,
June, September, and December. Capital gains are distributed in December.
DISTRIBUTION OPTIONS
When you open an account, specify on your application how you want to
receive your distributions. If the option you prefer is not listed on the
application, call 1-800-544-6666 for instructions. The fund offers four
options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions will
be automatically reinvested in additional shares of the fund. If you do not
indicate a choice on your application, you will be assigned this option.
2. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested, but you will be sent a check for each dividend
distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions.
4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and
capital gain distributions will be automatically invested in another
identically registered Fidelity fund.
FOR RETIREMENT ACCOUNTS, all distributions are automatically reinvested.
When you are over 59 years old, you can receive distributions in cash.
When the fund deducts a distribution from its NAV, the reinvestment price
is the fund's NAV at the close of business that day. Cash distribution
checks will be mailed within seven days.
UNDERSTANDING
DISTRIBUTIONS
As a fund shareholder, you
are entitled to your share of
the fund's net income and
gains on its investments. The
fund passes its earnings
along to its investors as
DISTRIBUTIONS.
The fund earns dividends
from stocks and interest from
bond, money market, and
other investments. These are
passed along as DIVIDEND
DISTRIBUTIONS. The fund
realizes capital gains
whenever it sells securities
for a higher price than it paid
for them. These are passed
along as CAPITAL GAIN
DISTRIBUTIONS.
(checkmark)
TAXES
As with any investment, you should consider how your investment in the fund
will be taxed. If your account is not a tax-deferred retirement account,
you should be aware of these tax implications.
TAXES ON DISTRIBUTIONS. Distributions are subject to federal income tax,
and may also be subject to state or local taxes. If you live outside the
United States, your distributions could also be taxed by the country in
which you reside. Your distributions are taxable when they are paid,
whether you take them in cash or reinvest them. However, distributions
declared in December and paid in January are taxable as if they were paid
on December 31.
For federal tax purposes, the fund's income and short-term capital gain
distributions are taxed as dividends; long-term capital gain distributions
are taxed as long-term capital gains. Every January, Fidelity will send you
and the IRS a statement showing the taxable distributions paid to you in
the previous year.
TAXES ON TRANSACTIONS. Your redemptions - including exchanges to other
Fidelity funds - are subject to capital gains tax. A capital gain or loss
is the difference between the cost of your shares and the price you receive
when you sell them.
Whenever you sell shares of the fund, Fidelity will send you a confirmation
statement showing how many shares you sold and at what price. You will also
receive a consolidated transaction statement every January. However, it is
up to you or your tax preparer to determine whether this sale resulted in a
capital gain and, if so, the amount of tax to be paid. Be sure to keep your
regular account statements; the information they contain will be essential
in calculating the amount of your capital gains.
"BUYING A DIVIDEND." If you buy shares when the fund has realized but not
yet distributed income or capital gains, you will pay the full price for
the shares and then receive a portion of the price back in the form of a
taxable distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the fund
and its investments and these taxes generally will reduce the fund's
distributions. However, an offsetting tax credit or deduction may be
available to you. If so, your tax statement will show more taxable income
or capital gains than were actually distributed by the fund, but will also
show the amount of the available offsetting credit or deduction.
There are tax requirements that all funds must follow in order to avoid
federal taxation. In its effort to adhere to these requirements, the fund
may have to limit its investment activity in some types of instruments.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE)
is open. Fidelity normally calculates the fund's NAV as of the close of
business of the NYSE, normally 4 p.m. Eastern time.
THE FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and then dividing the result by the number of
shares outstanding.
The fund's assets are valued primarily on the basis of market quotations.
Foreign securities are valued on the basis of quotations from the primary
market in which they are traded, and are translated from the local currency
into U.S. dollars using current exchange rates. Short-term securities with
remaining maturities of sixty days or less for which quotations are not
readily available are valued on the basis of amortized cost. This method
minimizes the effect of changes in a security's market value. In addition,
if quotations are not readily available, or if the values have been
materially affected by events occurring after the closing of a foreign
market, assets may be valued by a method that the Board of Trustees
believes accurately reflects fair value.
THE FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION PRICE
(price to sell one share) are its NAV.
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require the fund to
withhold 31% of your taxable distributions and redemptions.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does not
follow reasonable procedures designed to verify the identity of the caller.
Fidelity will request personalized security codes or other information, and
may also record calls. You should verify the accuracy of your confirmation
statements immediately after you receive them. If you do not want the
ability to redeem and exchange by telephone, call Fidelity for
instructions.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods
of unusual market activity), consider placing your order by mail or by
visiting a Fidelity Investor Center.
THE FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. The fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they would
disrupt management of the fund.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your order will be processed at the
next offering price calculated after your order is received and accepted.
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) The fund 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
cancelled and you could be liable for any losses or fees the fund or its
transfer agent has incurred.
TO AVOID THE COLLECTION PERIOD associated with check and Money Line
purchases, consider buying shares by bank wire, U.S. Postal money order,
U.S. Treasury check, Federal Reserve check, or direct deposit instead.
CERTAIN FINANCIAL INSTITUTIONS that have entered into sales agreements with
FDC may enter confirmed purchase orders on behalf of customers by phone,
with payment to follow no later than the time when the fund is priced on
the following business day. If payment is not received by that time, the
financial institution could be held liable for resulting fees or losses.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your request is received and accepted. Note the
following:
(small solid bullet) Normally, redemption proceeds will be mailed to you on
the next business day, but if making immediate payment could adversely
affect the fund, it may take up to seven days to pay you.
(small solid bullet) Fidelity Money Line redemptions generally will be
credited to your bank account on the second or third business day after
your phone call.
(small solid bullet) The fund may hold payment on redemptions until it is
reasonably satisfied that investments made by check or Fidelity Money Line
have been collected, which can take up to seven business days.
(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.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of
$12.00 from accounts with a value of less than $2,500, 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 the transfer agent, 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 in
Fidelity exceed $ 3 0,000. Eligibility for the $ 3 0,000 waiver
is determined by aggregating Fidelity accounts maintained by FSC 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, you will be given 30
days' notice to reestablish the minimum balance. If you do not increase
your balance, Fidelity reserves the right to close your account and send
the proceeds to you. Your shares will be redeemed at the NAV on the day
your account is closed.
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
FDC may, at its own expense, provide promotional incentives to qualified
recipients who support the sale of shares of the fund without reimbursement
from the fund. Qualified recipients are securities dealers who have sold
fund shares or others, including banks and other financial institutions,
under special arrangements in connection with FDC's sales activities. In
some instances, these incentives may be offered only to certain
institutions whose representatives provide services in connection with the
sale or expected sale of significant amounts of shares.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging shares of the fund
for shares of other Fidelity funds. However, you should note the following:
(small solid bullet) The fund you are exchanging into must be available for
sale in your state.
(small solid bullet) You may only exchange 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) If you exchange into a fund with a sales charge, you
pay the percentage-point difference between that fund's sales charge and
any sales charge you have previously paid in connection with the shares you
are exchanging. For example, if you had already paid a sales charge of 2%
on your shares and you exchange them into a fund with a 3% sales charge,
you would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Because excessive trading can hurt fund performance
and shareholders, the fund reserves the right to temporarily or permanently
terminate the exchange privilege of any investor who makes more than four
exchanges out of the fund per calendar year. Accounts under common
ownership or control, including accounts with the same taxpayer
identification number, will be counted together for purposes of the four
exchange limit.
(small solid bullet) The exchange limit may be modified for accounts in
certain institutional retirement plans to conform to plan exchange limits
and Department of Labor regulations. See your plan materials for further
information.
(small solid bullet) The fund reserves the right to 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.
(small solid bullet) Your exchanges may be restricted or refused if the
fund receives or anticipates simultaneous orders affecting significant
portions of the fund's assets. In particular, a pattern of exchanges that
coincides with a "market timing" strategy may be disruptive to the fund.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any time. The
fund reserves the right to terminate or modify the exchange privilege in
the future.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50% on
exchanges. Check each fund's prospectus for details.
The Fidelity Pyramid and Logo, Fidelity Money Line, and Directed Dividends
are registered trademarks of FMR Corp. Fidelity Asset Manager, Fidelity
Automatic Account Builder, and TouchTone Xpress are trademarks of FMR Corp.

This prospectus is printed on recycled paper using soy-based inks.
FIDELITY CHARLES STREET TRUST:
FIDELITY ASSET MANAGER FUNDS

CROSS REFERENCE SHEET
FORM N-1A

ITEM NUMBER PROSPECTUS SECTION

<TABLE>
<CAPTION>
<S> <C> <C> <C>
1 .............................. Cover Page

2 a .............................. Expenses

b, c .............................. Contents; The Funds at a Glance; Who May Want
to Invest

3 a .............................. Financial Highlights

b .............................. *

c,d .............................. Performance

4 a i............................. Charter

ii........................... The Funds at a Glance; Investment Principles and
Risks, Securities and Investment Practices

b .............................. Investment Principles and Risks, Securities and
Investment Practices

c .............................. Who May Want to Invest; Investment Principles
and Risks, Securities and Investment Practices

5 a .............................. Charter

b i............................. Cover Page; The Funds at a Glance; Charter;
Doing Business with Fidelity, FMR and Its
Affiliates

ii........................... Charter, FMR and Its Affiliates

iii.......................... Expenses; Breakdown of Expenses

c .............................. Charter

d .............................. Charter; Breakdown of Expenses

e .............................. Cover Page; Charter

f .............................. Expenses

g i............................. Charter

ii............................ *

5A .............................. Performance

6 a i............................. Charter

ii........................... How to Buy Shares; How to Sell Shares;
Transaction Details; Exchange Restrictions

iii.......................... Charter

b ............................. Charter, FMR and Its Affiliates

c .............................. Transaction Details; Exchange Restrictions

d .............................. *

e .............................. Cover Page, Doing Business with Fidelity; How to
Buy Shares; How to Sell Shares; Investor Services

f, g .............................. Dividends, Capital Gains, and Taxes

7 a .............................. Cover Page; Charter

b .............................. Expenses; How to Buy Shares; Transaction Details

c .............................. *

d .............................. How to Buy Shares

e .............................. *

f .............................. Expenses, Breakdown of Expenses

8 .............................. How to Sell Shares; Investor Services; Transaction
Details; Exchange Restrictions

9 .............................. *

</TABLE>

* Not Applicable

Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how each
fund invests and the services available to shareholders.
THE FIDELITY
ASSET
MANAGER
FUNDS
To learn more about each fund and its investments, you can obtain a copy of
each fund's most recent financial report and portfolio listing, or a
copy of the Statement of Additional Information (SAI) da ted February
1 7, 199 7 . The SAI has been filed with the Securities and
Exchange Commission (SEC) and is available along with other related
materials on the SEC's Internet Web site (http://www.sec.gov). The SAI is
incorporated herein by reference (legally forms a part of the prospectus).
For a free copy of either document, call Fidelity at 1-800-544-8888.
Mutual fund shares are not deposits or obligations of, or guaranteed by,
any depository institution. Shares are not insured by the FDIC, Federal
Reserve Board, or any other agency, and are subject to investment risks,
including possible loss of principal amount invested.
This family of asset allocation funds offers three approaches to
diversifying your investment. Each fund seeks to achieve its individual
goal by investing in different mixes of stocks, bonds and short-term and
money market instruments of all types.
FIDELITY ASSET MANAGER: INCOME seeks high current income, but also
considers the potential for capital appreciation.
(fund number 328, trading symbol FASIX)
FIDELITY ASSET MANAGER(trademark) seeks high total return with reduced risk
over the long term.
(fund number 314, trading symbol FASMX)
FIDELITY ASSET MANAGER: GROWTH seeks to maximize total return over the long
term.
LIKE ALL MUTUAL FUNDS,
THESE SECURITIES HAVE NOT
BEEN APPROVED OR
DISAPPROVED BY THE
SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE
SECURITIES COMMISSION,
NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION OR
ANY STATE SECURITIES
COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE
CONTRARY IS A CRIMINAL
OFFENSE.
FFM-pro- 1196-01
(fund number 321, trading symbol FASGX)
PROSPECTUS
FEBRUARY 17, 1997
(registered trademark)
82 Devonshire Street, Boston, MA 0210
9
CONTENTS

<TABLE>
<CAPTION>
<S> <C> <C>
KEY FACTS THE FUNDS AT A GLANCE

WHO MAY WANT TO INVEST

EXPENSES Each fund's yearly operating expenses.

FINANCIAL HIGHLIGHTS A summary of each fund's
financial data.

PERFORMANCE How each fund has done over time.

THE FUNDS IN DETAIL CHARTER How each fund is organized.

INVESTMENT PRINCIPLES AND RISKS Each fund's overall
approach to investing.

BREAKDOWN OF EXPENSES How operating costs are
calculated and what they include.

YOUR ACCOUNT DOING BUSINESS WITH FIDELITY

TYPES OF ACCOUNTS Different ways to set up your
account, including tax-sheltered retirement plans.

HOW TO BUY SHARES Opening an account and making
additional investments.

HOW TO SELL SHARES Taking money out and closing
your account.

INVESTOR SERVICES Services to help you manage your
account.

SHAREHOLDER AND ACCOUNT POLICIES DIVIDENDS, CAPITAL GAINS, AND TAXES

TRANSACTION DETAILS Share price calculations and the
timing of purchases and redemptions.

EXCHANGE RESTRICTIONS

</TABLE>

KEY FACTS

THE FUNDS AT A GLANCE
STRATEGY: The funds diversif y across stocks, bonds and short-term and
money market instruments, both here and abroad, to p ursue specific
goals. Each fund has a neutral mix which represents the way the fund's
investments will generally be allocated over the long term. This mix will
vary over short-term periods as fund management gradually adjusts the
fund's holdings - within defined ranges - based on the current outlook for
the different markets.
MANAGEMENT: Fidelity Management & Research Company (FMR) is the management
arm of Fidelity Investments, which was established in 1946 and is now
America's largest mutual fund manager. Foreign affiliates of FMR may help
choose investments for the funds.
As with any mutual fund, there is no assurance that a fund will achieve its
goal.
WHO MAY WANT TO INVEST
Asset allocation funds are designed for investors who want to diversify
among domestic and foreign stocks, bonds and short-term and money
market instruments and other types of securities, in one fund. If you
are looking for a fund that can invest in a wide range of security types
within defined ranges, one of the Asset Manager funds may be appropriate
for you.
Because each fund owns different types of investments, its performance is
affected by a variety of factors. The value of each fund's investments and
the income they generate will vary from day to day, and generally reflect
interest rates, market conditions, and other company, political and
economic news. Performance also depends on FMR's skill in allocating
assets. When you sell your fund shares, they may be worth more or less than
what you paid for them.
ASSET MANAGER: INCOME

GOAL: High current income, and capital appreciation when appropriate.
Neutral Mix
STOCKS 20%

(can range from
10-30%)
Row: 1, Col: 1, Value: 30.0
Row: 1, Col: 2, Value: 20.0
Row: 1, Col: 3, Value: 50.0
BONDS 50%

(can range from
40-60%)
SHORT-TERM/MONE
Y MARKET
30% (can range
from 10-50%)
With its emphasis on bonds and short-term and money market
instruments , Asset Manager: Income is the most conservative fund in the
family.
ASSET MANAGER

GOAL: High total return with reduced risk over the long term.
Neutral Mix
STOCKS 50%

(can range from
30-70%)
Row: 1, Col: 1, Value: 10.0
Row: 1, Col: 2, Value: 50.0
Row: 1, Col: 3, Value: 40.0
B ONDS 40%

(can range from
20-60%)
S HORT-TERM/MON
EY MARKET 10%
(can range from
0-50%)
With its more balanced approach, Asset Manager is the middle-of-the-road
member of the family.
ASSET MANAGER: GROWTH

GOAL: Maximum total return over the long term.
Neutral Mix
STOCKS 70%

(can range from
50-100%)
Row: 1, Col: 1, Value: 5.0
Row: 1, Col: 2, Value: 65.0
Row: 1, Col: 3, Value: 30.0
BO NDS 25%

(can range from
0-50%)
SHORT-TERM/MONE
Y MARKET 5% (can
range from
0-50%)
With its emphasis on stocks, Asset Manager: Growth is the most aggressive
fund in the family.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or
sell shares of a fund. In addition, you may be charged an annual account
maintenance fee if your account balance falls below $2,500. See
"Transaction Details" page , for an explanation of how and when these
charges apply.
Maximum sales charge on purchases and reinvested distributions None

Deferred sales charge on redemptions None

Exchange fee None

Annual account maintenance fee (for accounts under $2,500) $12.0
0

ANNUAL FUND OPERATING EXPENSES are paid out of each fund's assets. Each
fund pays a management fee to FMR. Each fund also incurs other expenses for
services such as maintaining shareholder records and furnishing shareholder
statements and financial reports. A fund's expenses are factored into its
share price or dividends and are not charged directly to shareholder
accounts (see page ).
The following figures are based on historical expenses, adjusted to
reflect current fees, and are calculated as a percentage of average net
assets. A portion of the brokerage commissions that each fund
pays is used to reduce fund expenses. In addition, each fund has
entered into arrangements with its custodian and transfer agent whereby
interest earned on uninvested cash balances is used to reduce custodian and
transfer agent expenses. Including these reductions, the total operating
expenses presented in the table would have been .76% for Asset Manager:
Income, .81% for Asset Manager, and .93% for Asset Manager: Growth.
ASSET MANAGER: INCOME

Management fee .45
%*

12b-1 fee Non
e

Other expenses .33
%

Total fund operating expenses .78
%

ASSET MANAGER

Management fee .56
% *

12b-1 fee Non
e

Other expenses .27
%

Total fund operating expenses .83
%

ASSET MANAGER: GROWTH

Management fee .61
%*

12b-1 fee Non
e

Other expenses .33
%

Total fund operating expenses .94
%

* EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
.35% TO .30% FOR ASSET MANAGER: INCOME, .40% TO .25% FOR ASSET MANAGER, AND
.40% TO .30% FOR ASSET MANAGER: GROWTH. IF THIS AGREEMENT WERE NOT IN
EFFECT, THE MANAGEMENT FEES AND TOTAL OPERATING EXPENSES WOULD HAVE
BEEN .50 % AND .83% FOR ASSET MANAGER: INCOME , .71 %
AND .98% FOR ASSET MANAGER , AND .71 % AND 1.04% FOR ASSET
MANAGER: GROWTH , RESPECTIVELY.
EXAMPLES: Let's say, hypothetically, that each fund's annual return is 5%
and that its operating expenses are exactly as just described. For every
$1,000 you invested, here's how much you would pay in total expenses if you
close your account after the number of years indicated:
After 1 After 3 After 5 After 10
year years years years

Asset Manager: $ 8 $ 25 $ 43 $ 97
Income

Asset Manager $ 8 $ 26 $ 46 $ 103

Asset Manager: $ 10 $ 30 $ 52 $ 115
Growth

These examples illustrate the effect of expenses, but are not meant to
suggest actual or expected costs or returns, all of which may vary.
FINANCIAL HIGHLIGHTS
The financial highlights tables that follow have been audited by
Price Waterhouse LLP, independent accountants. The funds'
financial highlights, financial statements and reports of the
auditor are included in the funds' Annual Reports , and
are incorporated by reference into (are legally a part of) the funds'
SAI . Contact Fidelity for a free copy of the Annual Report or the SAI.
FIDELITY ASSET MANAGER: INCOME

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Selected Per-Share Data and Ratios

Years ended September 30 1996 1995 1994C 1993B

Net asset value, beginning of period $ 11.46 $ 10.69 $ 11.07 $ 10.00

Income from Investment Operations

Net investment income .61 .56 .45 .46

Net realized and unrealized gain (loss) .20 .68 (.29) 1.04

Total from investment operations .81 1.24 .16 1.50

Less Distributions

From net investment income (.64) (.47) (.47) (.43)

From net realized gain -- -- (.04) --

In excess of net realized gain -- -- (.03) --

Total distributions (.64) (.47) (.54) (.43)

Net asset value, end of period $ 11.63 $ 11.46 $ 10.69 $ 11.07

Total returnA 7.28% 11.99% 1.46% 15.32%

Net assets, end of period (000 omitted) $ 566,104 $ 566,079 $ 501,349 $ 199,237

Ratio of expenses to average net assets .82% .79% .71% .65%
D D

Ratio of expenses to average net assets after
expense reductions .80% .79% .71% .65%
E

Ratio of net investment income to average net
assets 5.03% 5.15% 4.92% 5.19%

Portfolio turnover rate 148% 157% 83% 47%

Average commission rateF $ .0286

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Selected Per-Share Data and Ratios

Years ended September 30 1996 1995 1994E 1993 1992 1991 1990 1989B

Net asset value, beginning
of period $ 15.47 $ 14.58 $ 14.97 $ 13.50 $ 13.02 $ 10.64 $ 11.39 $ 10.00

Income from Investment Operations

Net investment income .62 .49 .34 .52 .46 .55 .58 .27

Net realized and unrealized
gain (loss) .96 .93 .21 2.01 .97 2.48 (.71) 1.12

Total from investment
operations 1.58 1.42 .55 2.53 1.43 3.03 (.13) 1.39

Less Distributions

From net investment income (.56) (.44) (.44) (.87) (.45) (.65) (.38) --

From net realized gain -- -- (.45) (.19) (.50) -- (.24) --

In excess of net realized gain -- (.09) (.05) -- -- -- -- --

Total distributions (.56) (.53) (.94) (1.06) (.95) (.65) (.62) --

Net asset value, end of period $ 16.49 $ 15.47 $ 14.58 $ 14.97 $ 13.50 $ 13.02 $ 10.64 $ 11.39

Total returnC,D 10.37% 10.09% 3.60% 19.71% 11.84% 29.78% (1.27)% 13.90%

Net assets, end of period (in
millions) $ 10,674 $ 11,084 $ 11,792 $ 7,266 $ 2,762 $ 743 $ 346 $ 245

Ratio of expenses to average
net assets .95% .97% 1.04% 1.09% 1.17% 1.17% 1.17% 1.58%A

Ratio of expenses to average net
assets after expense .93%F .97% 1.04% 1.09% 1.17% 1.17% 1.17% 1.58%A
reductions

Ratio of net investment income
to average net assets 3.64% 4.27% 3.63% 4.28% 5.58% 5.74% 5.89% 5.88%A

Portfolio turnover rate 131% 137% 109% 98% 134% 134% 105% 167%A

Average commission rateG $ .0045

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Selected Per-Share Data and Ratios

Years ended September 30 1996 1995 1994F 1993 1992E

Net asset value, beginning of period $ 14.88 $ 13.91 $ 13.77 $ 11.16 $ 10.00

Income from Investment Operations

Net investment income .47 .26 .13 .18 .14

Net realized and unrealized gain (loss) 1.44 1.07 .61 2.66 1.02

Total from investment operations 1.91 1.33 .74 2.84 1.16

Less Distributions

From net investment income (.23) (.27) (.18) (.15) --

From net realized gain -- -- (.37) (.08) --

In excess of net realized gain -- (.09) (.05) -- --

Total distributions (.23) (.36) (.60) (.23) --

Net asset value, end of period $ 16.56 $ 14.88 $ 13.91 $ 13.77 $ 11.16

Total returnB,C 12.99% 9.95% 5.39% 25.83% 11.60%

Net assets, end of period (in millions) $ 3,099 $ 2,850 $ 3,071 $ 1,243 $ 94

Ratio of expenses to average net assets 1.02% 1.03% 1.15% 1.19% 1.64%
D A

Ratio of expenses to average net assets
after expense reductions 1.01% 1.02% 1.15% 1.19% 1.64%
G G A

Ratio of net investment income to average
net assets 2.51% 3.16% 2.64% 3.02% 3.50%
A

Portfolio turnover rate 138% 119% 104% 97% 693%
A

Average commission rateH $ .0027

</TABLE>

A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
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 DECEMBER 30, 1991 (COMMENCEMENT OF OPERATIONS) TO SEPTEMBER 30, 1992
F EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
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.
H FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
PERFORMANCE
Mutual fund performance is commonly measured as TOTAL RETURN. The total
returns that follow are based on historical fund results and do not reflect
the effect of taxes.
Each fund's fiscal year runs from October 1 through September 30. The
tables below show each fund's performance over past fiscal years compared
to different measures, including a comparative index and a competitive
funds average. The charts on page present calendar year performance.
AVERAGE ANNUAL TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
Fiscal periods ended Past 1 Past 5 Life of
September 30, 1996 year years fund

Asset Manager: Income 7.28 % .n/a 8.88 %A

Asset Manager 10.37 % 11.00 % 12.29 %B

Asset Manager: Growth 12.99 % .n/a 13.65 %C

S&P 500 (registered trademark) 20.33 % 15.23 % n/a

Lehman Bros. Aggregate Bond Index 4.90 % n/a n/a

Lipper Income Funds Average 10.90 % 10.43 % n/a

Lipper Flexible Portfolio Funds Average 12.33 % 11.19 % n/a

</TABLE>

CUMULATIVE TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
Fiscal periods ended Past 1 Past 5 Life of
September 30, 1996 year years fund

Asset Manager: Income 7.28 % .n/a 40.55 %A

Asset Manager 10.37 % 68.54 % 145.97 %B

Asset Manager: Growth 12.99 % .n/a 83.86 %C

S&P 500 20.33 % 103.18 % n/a

Lehman Bros. Aggregate Bond Index 4.90 % n/a n/a

Lipper Income Funds Average 10.90 % 64.60 % n/a

Lipper Flexible Portfolio Funds Average 12.33 % 71.56 % n/a

</TABLE>

A FROM OCTOBER 1, 1992 (COMMENCEMENT OF OPERATIONS)
B FROM DECEMBER 28, 1988 (COMMENCEMENT OF OPERATIONS)
C FROM DECEMBER 30, 1991 (COMMENCEMENT OF OPERATIONS)

EXAMPLE: Let's say, hypothetically, that you had $10,000 invested in
each fund on its start date. The charts below show the growth in value of
your $10,000 investment in each fund through September 30, 1 9 96.
ASSET MANAGER: INCOME

Fiscal periods 199 2 199 4 199 5
1996
Row: 1, Col: 1, Value: 10000.0
Row: 2, Col: 1, Value: 9890.0
Row: 3, Col: 1, Value: 10020.3
Row: 4, Col: 1, Value: 10222.02
Row: 5, Col: 1, Value: 10485.16
Row: 6, Col: 1, Value: 10657.39
Row: 7, Col: 1, Value: 10891.49
Row: 8, Col: 1, Value: 10973.54
Row: 9, Col: 1, Value: 11035.05
Row: 10, Col: 1, Value: 11158.52
Row: 11, Col: 1, Value: 11251.64
Row: 12, Col: 1, Value: 11500.56
Row: 13, Col: 1, Value: 11531.81
Row: 14, Col: 1, Value: 11688.44
Row: 15, Col: 1, Value: 11615.38
Row: 16, Col: 1, Value: 11794.96
Row: 17, Col: 1, Value: 11997.58
Row: 18, Col: 1, Value: 11783.98
Row: 19, Col: 1, Value: 11558.83
Row: 20, Col: 1, Value: 11569.5
Row: 21, Col: 1, Value: 11602.06
Row: 22, Col: 1, Value: 11536.9
Row: 23, Col: 1, Value: 11689.09
Row: 24, Col: 1, Value: 11809.1
Row: 25, Col: 1, Value: 11699.69
Row: 26, Col: 1, Value: 11732.89
Row: 27, Col: 1, Value: 11644.89
Row: 28, Col: 1, Value: 11634.28
Row: 29, Col: 1, Value: 11701.27
Row: 30, Col: 1, Value: 11913.79
Row: 31, Col: 1, Value: 12037.44
Row: 32, Col: 1, Value: 12194.96
Row: 33, Col: 1, Value: 12488.19
Row: 34, Col: 1, Value: 12612.6
Row: 35, Col: 1, Value: 12816.64
Row: 36, Col: 1, Value: 12930.56
Row: 37, Col: 1, Value: 13101.93
Row: 38, Col: 1, Value: 13124.85
Row: 39, Col: 1, Value: 13355.23
Row: 40, Col: 1, Value: 13575.82
Row: 41, Col: 1, Value: 13727.97
Row: 42, Col: 1, Value: 13634.06
Row: 43, Col: 1, Value: 13622.07
Row: 44, Col: 1, Value: 13633.74
Row: 45, Col: 1, Value: 13681.62
Row: 46, Col: 1, Value: 13788.98
Row: 47, Col: 1, Value: 13694.14
Row: 48, Col: 1, Value: 13729.26
Row: 49, Col: 1, Value: 14055.41
$
$14,055
ASSET MANAGER

Fiscal periods 19 88 199 3
1996
Row: 1, Col: 1, Value: 10000.0
Row: 2, Col: 1, Value: 10030.0
Row: 3, Col: 1, Value: 10410.0
Row: 4, Col: 1, Value: 10250.0
Row: 5, Col: 1, Value: 10340.0
Row: 6, Col: 1, Value: 10610.0
Row: 7, Col: 1, Value: 10920.0
Row: 8, Col: 1, Value: 11040.0
Row: 9, Col: 1, Value: 11360.0
Row: 10, Col: 1, Value: 11390.0
Row: 11, Col: 1, Value: 11390.0
Row: 12, Col: 1, Value: 11440.0
Row: 13, Col: 1, Value: 11520.0
Row: 14, Col: 1, Value: 11562.28
Row: 15, Col: 1, Value: 11192.37
Row: 16, Col: 1, Value: 11276.92
Row: 17, Col: 1, Value: 11393.17
Row: 18, Col: 1, Value: 11202.94
Row: 19, Col: 1, Value: 11794.79
Row: 20, Col: 1, Value: 11889.91
Row: 21, Col: 1, Value: 11879.34
Row: 22, Col: 1, Value: 11477.72
Row: 23, Col: 1, Value: 11245.21
Row: 24, Col: 1, Value: 11276.92
Row: 25, Col: 1, Value: 11815.93
Row: 26, Col: 1, Value: 12184.23
Row: 27, Col: 1, Value: 12834.35
Row: 28, Col: 1, Value: 13394.81
Row: 29, Col: 1, Value: 13618.99
Row: 30, Col: 1, Value: 13831.96
Row: 31, Col: 1, Value: 14179.44
Row: 32, Col: 1, Value: 13876.79
Row: 33, Col: 1, Value: 14246.69
Row: 34, Col: 1, Value: 14571.76
Row: 35, Col: 1, Value: 14594.17
Row: 36, Col: 1, Value: 14706.26
Row: 37, Col: 1, Value: 14448.46
Row: 38, Col: 1, Value: 15064.82
Row: 39, Col: 1, Value: 15282.45
Row: 40, Col: 1, Value: 15572.63
Row: 41, Col: 1, Value: 15572.63
Row: 42, Col: 1, Value: 15790.26
Row: 43, Col: 1, Value: 15947.43
Row: 44, Col: 1, Value: 15947.43
Row: 45, Col: 1, Value: 16273.88
Row: 46, Col: 1, Value: 16201.33
Row: 47, Col: 1, Value: 16322.24
Row: 48, Col: 1, Value: 16298.06
Row: 49, Col: 1, Value: 16660.78
Row: 50, Col: 1, Value: 16984.94
Row: 51, Col: 1, Value: 17277.13
Row: 52, Col: 1, Value: 17454.98
Row: 53, Col: 1, Value: 18029.64
Row: 54, Col: 1, Value: 18106.58
Row: 55, Col: 1, Value: 18491.28
Row: 56, Col: 1, Value: 18724.08
Row: 57, Col: 1, Value: 19008.76
Row: 58, Col: 1, Value: 19552.24
Row: 59, Col: 1, Value: 19539.98
Row: 60, Col: 1, Value: 20144.3
Row: 61, Col: 1, Value: 20075.14
Row: 62, Col: 1, Value: 20940.46
Row: 63, Col: 1, Value: 21620.35
Row: 64, Col: 1, Value: 20940.46
Row: 65, Col: 1, Value: 19927.45
Row: 66, Col: 1, Value: 19913.73
Row: 67, Col: 1, Value: 20078.31
Row: 68, Col: 1, Value: 19636.47
Row: 69, Col: 1, Value: 20022.86
Row: 70, Col: 1, Value: 20492.03
Row: 71, Col: 1, Value: 20243.05
Row: 72, Col: 1, Value: 20340.24
Row: 73, Col: 1, Value: 20034.79
Row: 74, Col: 1, Value: 19558.09
Row: 75, Col: 1, Value: 19402.53
Row: 76, Col: 1, Value: 19699.51
Row: 77, Col: 1, Value: 20013.12
Row: 78, Col: 1, Value: 20425.91
Row: 79, Col: 1, Value: 20909.87
Row: 80, Col: 1, Value: 21196.75
Row: 81, Col: 1, Value: 21783.96
Row: 82, Col: 1, Value: 21927.18
Row: 83, Col: 1, Value: 22285.82
Row: 84, Col: 1, Value: 22213.79
Row: 85, Col: 1, Value: 22631.56
Row: 86, Col: 1, Value: 23109.04
Row: 87, Col: 1, Value: 23604.75
Row: 88, Col: 1, Value: 23488.12
Row: 89, Col: 1, Value: 23489.33
Row: 90, Col: 1, Value: 23694.86
Row: 91, Col: 1, Value: 23944.43
Row: 92, Col: 1, Value: 24078.1
Row: 93, Col: 1, Value: 23619.33
Row: 94, Col: 1, Value: 23767.32
Row: 95, Col: 1, Value: 24596.65
$
$24,597
ASSET MANAGER: GROWTH

Fiscal periods 199 1 199 4 199 5
1996
Row: 1, Col: 1, Value: 10000.0
Row: 2, Col: 1, Value: 10080.0
Row: 3, Col: 1, Value: 10450.0
Row: 4, Col: 1, Value: 10670.0
Row: 5, Col: 1, Value: 10520.0
Row: 6, Col: 1, Value: 10550.0
Row: 7, Col: 1, Value: 10770.0
Row: 8, Col: 1, Value: 10650.0
Row: 9, Col: 1, Value: 11090.0
Row: 10, Col: 1, Value: 10910.0
Row: 11, Col: 1, Value: 11160.0
Row: 12, Col: 1, Value: 11370.0
Row: 13, Col: 1, Value: 11780.0
Row: 14, Col: 1, Value: 12003.17
Row: 15, Col: 1, Value: 12176.54
Row: 16, Col: 1, Value: 12329.51
Row: 17, Col: 1, Value: 12808.82
Row: 18, Col: 1, Value: 12849.61
Row: 19, Col: 1, Value: 13114.76
Row: 20, Col: 1, Value: 13308.53
Row: 21, Col: 1, Value: 13553.28
Row: 22, Col: 1, Value: 14103.98
Row: 23, Col: 1, Value: 14042.79
Row: 24, Col: 1, Value: 14481.31
Row: 25, Col: 1, Value: 14358.93
Row: 26, Col: 1, Value: 15161.86
Row: 27, Col: 1, Value: 15747.06
Row: 28, Col: 1, Value: 15278.9
Row: 29, Col: 1, Value: 14502.18
Row: 30, Col: 1, Value: 14480.9
Row: 31, Col: 1, Value: 14597.94
Row: 32, Col: 1, Value: 14161.71
Row: 33, Col: 1, Value: 14512.82
Row: 34, Col: 1, Value: 15023.54
Row: 35, Col: 1, Value: 14800.1
Row: 36, Col: 1, Value: 14842.66
Row: 37, Col: 1, Value: 14417.06
Row: 38, Col: 1, Value: 14041.71
Row: 39, Col: 1, Value: 13691.76
Row: 40, Col: 1, Value: 13921.41
Row: 41, Col: 1, Value: 14205.75
Row: 42, Col: 1, Value: 14599.44
Row: 43, Col: 1, Value: 14960.32
Row: 44, Col: 1, Value: 15277.47
Row: 45, Col: 1, Value: 15911.75
Row: 46, Col: 1, Value: 15999.24
Row: 47, Col: 1, Value: 16272.63
Row: 48, Col: 1, Value: 16075.7
Row: 49, Col: 1, Value: 16469.48
Row: 50, Col: 1, Value: 16843.14
Row: 51, Col: 1, Value: 17398.28
Row: 52, Col: 1, Value: 17376.08
Row: 53, Col: 1, Value: 17409.39
Row: 54, Col: 1, Value: 17709.17
Row: 55, Col: 1, Value: 17909.02
Row: 56, Col: 1, Value: 17986.74
Row: 57, Col: 1, Value: 17531.52
Row: 58, Col: 1, Value: 17653.65
Row: 59, Col: 1, Value: 18386.45
$
$18,386
1.
YEAR-BY-YEAR TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Calendar years 1993 1994 1995

ASSET MANAGER: INCOME 15.39 -1.36 16.69
% % %

Lehman Bros. Aggregate Bond Index 9.75% -2.92 18.47
% %

Lipper Income Funds Average 12.17 -2.92 21.66
% % %

Consumer Price Index 2.75% 2.67% 2.54%

</TABLE>

Percentage (%)
Row: 1, Col: 1, Value: 0.0
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: 15.39
Row: 11, Col: 1, Value: -1.36
Row: 12, Col: 1, Value: 16.69
ASSET MANAGER: INCOME
YEAR-BY-YEAR TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Calendar
year s 1989 1990 1991 1992 1993 1994 1995

ASSET MANAGER 15.28 5.38 % 23.64 12.75 23.29 -6.60 18.16
% % % % % %

ASSET MANAGER:
GROWTH n/a n/a n/a 19.08 26.32 -7.39 19.95
% % % %

S&P 500 31.69 -3.10 30.47 7.62 % 10.08 1.32 % 37.58
% % % % %

Lipper Flexible
Portfolio Funds
Average 17.89 -0.70 26.56 7.51 % 11.94 -2.65 25.08
% % % % % %

Consumer Price Index 4.65 % 6.11 % 3.06 % 2.90 % 2.75 % 2.67 % 2.54 %

</TABLE>

Percentage (%)
ASSET MANAGER
ASSET MANAGER: GROWTH

Row: 1, Col: 1, Value: nil
Row: 1, Col: 2, Value: nil
Row: 1, Col: 3, Value: nil
Row: 2, Col: 1, Value: nil
Row: 2, Col: 2, Value: nil
Row: 2, Col: 3, Value: nil
Row: 3, Col: 1, Value: nil
Row: 3, Col: 2, Value: nil
Row: 3, Col: 3, Value: nil
Row: 4, Col: 1, Value: 15.28
Row: 4, Col: 2, Value: nil
Row: 4, Col: 3, Value: nil
Row: 5, Col: 1, Value: 5.38
Row: 5, Col: 2, Value: nil
Row: 5, Col: 3, Value: nil
Row: 6, Col: 1, Value: 23.64
Row: 6, Col: 2, Value: nil
Row: 6, Col: 3, Value: nil
Row: 7, Col: 1, Value: 12.75
Row: 7, Col: 2, Value: 19.08
Row: 7, Col: 3, Value: nil
Row: 8, Col: 1, Value: 23.29
Row: 8, Col: 2, Value: 26.32
Row: 8, Col: 3, Value: nil
Row: 9, Col: 1, Value: -6.6
Row: 9, Col: 2, Value: -7.39
Row: 9, Col: 3, Value: nil
Row: 10, Col: 1, Value: 18.16
Row: 10, Col: 2, Value: 19.95
Row: 10, Col: 3, Value: nil
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment in a fund over a given
period, assuming reinvestment of any dividends and capital gains. A
CUMULATIVE TOTAL RETURN reflects actual performance over a stated period of
time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that,
if achieved annually, would have produced the same cumulative total return
if performance had been constant over the entire period. Average annual
total returns smooth out variations in performance; they are not the same
as actual year-by-year results.
YIELD refers to the income generated by an investment in a fund over a
given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all stock and bond
funds. Because this differs from other accounting methods, the quoted yield
may not equal the income actually paid to shareholders.
THE STANDARD & POOR'S 500 INDEX (S&P 500(registered trademark)) is a widely
recognized, unmanaged index of common stocks.
THE LEHMAN BROTHERS AGGREGATE BOND INDEX is a market value weighted
performance benchmark for investment-grade fixed-rate debt issues,
including government, corporate, asset-backed, and mortgage-backed
securities, with maturities of at least one year.
Unlike each fund's returns, the total returns of each comparative index do
not include the effect of any brokerage commissions, transaction fees, or
other costs of investing.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government.
THE COMPETITIVE FUNDS AVERAGES are the Lipper Income Funds Average for
Asset Manager: Income and the Lipper Flexible Portfolio Funds Average for
Asset Manager and Asset Manager: Growth, which currently reflect
performance of over 22 and 150 mutual funds with similar investment
objectives, respectively. These averages, published by Lipper Analytical
Services, Inc., exclude the effect of sales charges.
Other illustrations of fund performance may show moving averages over
specified periods.
The funds' recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders. For
current performance or a free annual report, call 1-800-544-8888.
TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN
INDICATION OF FUTURE PERFORMANCE.
THE FUNDS IN DETAIL

CHARTER
EACH FUND IS A MUTUAL FUND: an investment that pools shareholders' money
and invests it toward a specified goal. Each fund is a diversified fund of
Fidelity Charles Street Trust, an open-end management investment company
organized as a Massachusetts business trust on July 7, 1981.
EACH FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the funds' activities,
review contractual arrangements with companies that provide services to the
funds, and review the funds' performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUNDS MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These
meetings may be called to elect or remove trustees, change fundamental
policies, approve a management contract, or for other purposes.
Shareholders not attending these meetings are encouraged to vote by proxy.
Fidelity will mail proxy materials in advance, including a voting card and
information about the proposals to be voted on. The number of votes you are
entitled to is based upon the dollar value of your investment.
FMR AND ITS AFFILIATES
The funds are managed by FMR, which chooses their investments and handles
their business affairs. Fidelity Management & Research (U.K.) Inc. (FMR
U.K.), in London, England, and Fidelity Management & Research (Far East)
Inc. (FMR Far East), in Tokyo, Japan, assist FMR with foreign investments.
Richard Habermann is vice president and lead manager of the Asset Manager
funds, which he has managed since March 1996. He also manages several other
Fidelity funds. Previously, Mr. Habermann was chief investment officer for
Fidelity International, Ltd., from 1991 to 1993, and division head for
international equities and director of international research, from 1993 to
1996. Mr. Habermann joined Fidelity in 1968.
George Vanderheiden is vice president of the Asset Manager funds and
manager of their equity investments, which he has managed since March 1996.
He also manages several other Fidelity funds. Mr. Vanderheiden joined
Fidelity in 1971.
Charles Morrison is manager of their fixed-income investments, which
he has managed since February 1997 . He also manages several other
Fidelity funds. Mr. Morrison joined Fidelity in 198 7 .
John Todd is vice president of the Asset Manager funds and manager of
their short-term and money market investments, which he has managed since
December 1996. He also manages several other Fidelity funds. Mr. Todd
joined Fidelity in 1981.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation (FDC) distributes and markets Fidelity's
funds and services. Fidelity Service Co mpany, Inc . (FSC) performs
transfer agent servicing functions for each fund.
FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far
East. Members of the Edward C. Johnson 3d family are the predominant owners
of a class of shares of common stock representing approximately 49% of the
voting power of FMR Corp. Under the Investment Company Act of 1940 (the
1940 Act), control of a company is presumed where one individual or group
of individuals owns more than 25% of the voting stock of that company;
therefore, the Johnson family may be deemed under the 1940 Act to form a
controlling group with respect to FMR Corp.
A broker-dealer may use a portion of the commissions paid by the funds
to reduce custodian or transfer agent fees for the funds. FMR may use its
broker-dealer affiliates and other firms that sell fund shares to carry out
a fund's transactions, provided that the fund receives brokerage services
and commission rates comparable to those of other broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
EACH FUND'S INVESTMENT APPROACH
Each fund seeks to achieve its investment objective by allocating its
assets among stocks, bonds and short-term and money market instruments
and other instruments of U.S. and foreign issuers. Each fund however,
has a different objective and pursues its objective by investing within
different asset allocation ranges.
ASSET MANAGER: INCOME seeks a high level of current income. The fund also
considers the potential for capital appreciation.
ASSET MANAGER seeks high total return with reduced risk over the long term.
ASSET MANAGER: GROWTH seeks to maximize total return over the long term.
Each fund allocates its assets among the following classes, or types, of
investments. The STOCK CLASS includes equity securities of all types. The
BOND CLASS includes all varieties of fixed-income securities maturing in
more than one year. The SHORT-TERM/MONEY MARKET CLASS includes all
types of sh ort-term and money market instruments. FMR may use its
judgment to place a security in the most appropriate class based on its
investment characteristics. Fixed-income securities may be classified in
the bond or short-term/money market class according to interest rate
sensitivity as well as maturity. The funds may also make other investments
that do not fall within these classes.
FMR has the ability to allocate each fund's assets within specified ranges.
Each fund's NEUTRAL MIX represents the benchmark for its combination of
investments in each asset class over time. FMR may change the neutral mix
from time to time. The range and approximate neutral mix for each asset
class are shown below.
ASSET MANAGER: INCOME

Range Neutral mix
STOCK CLASS 10 - 30% 20%
BOND CLASS 40 - 60% 50%
SHORT-TERM/MONEY MARKET CLASS 10 - 50% 30%
Asset Manager: Income's approach focuses on short-term and money market
instruments and bonds for current income. However, its ability to
invest a portion of its assets in stocks offers the opportunity for capital
appreciation, and potentially more volatility, than other income-oriented
funds.
ASSET MANAGER

Range Neutral mix
STOCK CLASS 30 - 70% 50%
BOND CLASS 20 - 60% 40%
SHORT-TERM/MONEY MARKET CLASS 0 - 50% 10%
Asset Manager's approach spreads the fund's assets among all three classes,
moderating both the risk and return potential of stocks, bonds and
short-term and money market instruments .
ASSET MANAGER: GROWTH

Range Neutral mix
STOCK CLASS 50 - 100% 70%
BOND CLASS 0 - 50% 25%
SHORT-TERM/MONEY MARKET CLASS 0 - 50% 5%
Asset Manager: Growth's more aggressive approach focuses on stocks for high
potential returns. However, because the fund can in vest in bonds and
short-term and money market instruments, its returns may not be as high
as a fund that invests only in stocks.
Since the funds are subject to the risks of each investment type, the funds
and their performance are affected by many factors. Stock values fluctuate
in response to the activities of individual companies and general market
and economic conditions. The value of bonds and short-term instruments
fluctuates based on changes in interest rates and in the credit quality of
the issuer. FMR may use various investment techniques to hedge a portion of
a fund's risks, but there is no guarantee that these strategies will work
as FMR intends. When you sell your shares, they may be worth more or less
than what you paid for them.
In pursuit of each fund's objective, FMR will not try to pinpoint the
precise moment when a major reallocation should be made. Instead, FMR
regularly reviews each fund's allocation and makes changes gradually to
favor investments that it believes will provide the most favorable outlook
for achieving each fund's objective. Under normal circumstances, a single
reallocation will not involve more than 10% of Asset Manager: Income's or
Asset Manager's total assets, or 20% of Asset Manager: Growth's total
assets. Although FMR uses its expertise and resources in allocating assets,
FMR's decisions may not be advantageous to a fund.
FMR normally invests each fund's assets according to its investment
strategy. Each fund also reserves the right to invest without limitation in
preferred stocks and investment-grade debt instruments for temporary,
defensive purposes.
Each fund diversifies across investment types more than most mutual funds.
No one mutual fund, however, can provide an appropriate balanced investment
plan for all investors.
SECURITIES AND INVESTMENT PRACTICES
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.
Any restrictions listed supplement those discussed earlier in this section.
A complete listing of each fund's limitations and more detailed information
about each fund's investments are contained in the funds' SAI. Policies and
limitations are considered at the time of purchase; the sale of instruments
is not required in the event of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques
unless it believes that they are consistent with a fund's investment
objective and policies and that doing so will help a fund achieve its goal.
Fund holdings and recent investment strategies are detailed in each fund's
financial reports, which are sent to shareholders twice a year. For a free
SAI or financial report, call 1-800-544-8888.
EQUITY SECURITIES may include common stocks and warrants. Common stocks,
the most familiar type, represent an equity (ownership) interest in a
corporation. Although equity securities have a history of long-term growth
in value, their prices fluctuate based on changes in a company's financial
condition and on overall market and economic conditions. Smaller companies
are especially sensitive to these factors.
RESTRICTIONS: With respect to 75% of total assets, a fund may not purchase
more than 10% of the outstanding voting securities of a single issuer.
FIDELITY ASSET MANAGER
Fiscal 1996 Debt Holdings, by Rating MOODY'S
INVESTORS SERVICE STANDARD & POOR'S
(AS A % OF INVESTMENTS) (AS A % OF INVESTMENTS)
Rating Average Rating Average
INVESTMENT GRADE*
Highest quality Aaa 26.0 % AAA 25.8 %
High quality Aa 0.1 % AA 0.3 %
Upper-medium grade A 1.0 % A 0.7 %
Medium grade Baa 0.6 % BBB 1.2 %
LOWER QUALITY*
Moderately speculative Ba 1.6 % BB 1.5 %
Speculative B 2.9 % B 2.2 %
Highly speculative Caa 0.3% CCC 0.2%
Poor quality Ca CC
Lowest quality, no interest C 0.0% C 0.0%
In default, in arrears 0.0% D 0.0 %
32.5 % 31.9 %
(AS A % OF INVESTMENTS)
SECURITIES NOT RATED BY MOODY'S OR S&P(dagger)
Investment Grade (double dagger) 0.7%
Lower Quality (double dagger) 0.4 %
Total 1.1 %
* FOR SOME FOREIGN GOVERNMENT OBLIGATIONS, FMR ASSIGNS THE RATINGS OF THE
SOVEREIGN CREDIT OF THE ISSUING
GOVERNMENT.
(dagger) THE DOLLAR-WEIGHTED AVERAGE PERCENTAGES REFLECTED IN THE TABLE MAY
INCLUDE SECURITIES RATED BY NATIONALLY RECOGNIZED
RATING SERVICES, AS WELL AS UNRATED SECURITIES.
(double dagger) AS DETERMINED BY FMR
DEBT SECURITIES. Bonds and other debt instruments are used by
issuers to borrow money from investors. The issuer pays the investor a
fixed , variable , or floating rate of interest, and must repay
the amount borrowed at maturity. Some debt securities, such as zero coupon
bonds, do not pay current interest, but are sold at a discount from
their face values. Debt securities have varying levels of sensitivity to
changes in interest rates and varying degrees of credit quality . In
general, bond prices rise when interest rates fall, and fall when interest
rates rise. Longer-term bonds and zero coupon bonds are
generally more sensitive to interest rate changes .
Lower-quality debt securities (sometimes called "junk bonds") are
considered to have speculative characteristics, and involve greater risk of
default or price changes due to changes in the issuer's creditworthiness,
or they may already be in default. The market prices of these securities
may fluctuate more than higher-quality securities and may decline
significantly in periods of general economic difficulty.
The following tables provide a summary of ratings assigned to debt holdings
(not including money market instruments) in the funds' portfolios. These
figures are dollar-weighted averages of month-end portfolio holdings for
the fiscal year ended September 1996, and are presented as a
percentage of total security investments. These percentages are historical
and do not necessarily indicate a fund's current or future debt holdings.
RESTRICTIONS: Purchase of a debt security is consistent with a fund's debt
quality policy if it is rated at or above the stated level by Moody's
Investors Service, Standard & Poor's, Duff & Phelps Credit Rating Co., or
Fitch Investors Service, L.P., or is unrated but judged to be of equivalent
quality by FMR. Asset Manager: Income currently intends to limit its
investments in corporate and foreign government debt securities (other than
convertible debt securities) to those of Baa-quality and above. The fund
currently intends to limit its investments in lower than Baa-quality
convertible debt securities to 5% of its assets. Each of Asset Manager and
Asset Manager: Growth currently intends to limit investments in lower than
Baa-quality debt securities to less than 35% of its assets.
MONEY MARKET SECURITIES are high-quality, short-term instruments issued by
the U.S. Government, corporations, financial institutions, and other
entities. These securities may carry fixed, variable, or floating interest
rates.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and
securities issued by U.S. entities with substantial foreign operations may
involve additional risks and considerations. These include risks relating
to political or economic conditions in foreign countries, fluctuations in
foreign currencies, withholding or other taxes, operational risks,
increased regulatory burdens, and the potentially less stringent investor
protection and disclosure standards of foreign markets. 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. All of these factors can make foreign
investments, especially those in developing countries, more volatile than
U.S. investments.
ASSET-BACKED SECURITIES include interests in pools of the following:
purchase contracts, financing leases, or sales agreements entered into by
municipalities; lower-rated debt securities; or consumer loans. The value
of these securities may be significantly affected by changes in interest
rates, the market's perception of issuers, and the creditworthiness of the
parties involved. Certain asset-backed securities rely on continued
payments by a municipality, and may also be subject to prepayment risk.
FIDELITY ASSET MANAGER: GROWTH
Fiscal 1996 Debt Holdings, by Rating MOODY'S
INVESTORS SERVICE STANDARD & POOR'S
(AS A % OF INVESTMENTS) (AS A % OF INVESTMENTS)
Rating Average Rating Average
INVESTMENT GRADE*
Highest quality Aaa 15.2 % AAA 15.1 %
High quality Aa 0.1 % AA 0.2 %
Upper-medium grade A 0.5 % A 0.3 %
Medium grade Baa 0.3 % BBB 0.6 %
LOWER QUALITY*
Moderately speculative Ba 0.9 % BB 1.2 %
Speculative B 3.4 % B 2.4 %
Highly speculative Caa 0.2% CCC 0.2%
Poor quality Ca CC
Lowest quality, no interest C 0.0% C 0.0%
In default, in arrears -- 0.0% D 0.0%
20.6 % 20.0 %
(AS A % OF INVESTMENTS)
SECURITIES NOT RATED BY MOODY'S OR S&P(dagger)
Investment Grade (double dagger) 0.4%
Lower Quality (double dagger) 0.9 %
Total 1.3 %
* FOR SOME FOREIGN GOVERNMENT OBLIGATIONS, FMR ASSIGNS THE RATINGS OF THE
SOVEREIGN CREDIT OF THE ISSUING
GOVERNMENT.
(dagger) THE DOLLAR-WEIGHTED AVERAGE PERCENTAGES REFLECTED IN THE TABLE MAY
INCLUDE SECURITIES RATED BY NATIONALLY RECOGNIZED
RATING SERVICES, AS WELL AS UNRATED SECURITIES.
(double dagger) AS DETERMINED BY FMR
MORTGAGE SECURITIES are interests in pools of commercial or residential
mortgages, and include complex instruments such as collateralized mortgage
obligations and stripped mortgage-backed securities. Mortgage securities
may be issued by the U.S. Government or by private entities. For example,
Ginnie Maes are interests in pools of mortgage loans insured or guaranteed
by a U.S. Government agency. Because mortgage securities pay both interest
and principal as their underlying mortgages are paid off, they are subject
to prepayment risk. This is especially true for stripped securities. Also,
the value of a mortgage security may be significantly affected by changes
in interest rates. Some mortgage securities may have a structure that makes
their reaction to interest rates and other factors difficult to predict,
making their value highly volatile.
STRIPPED SECURITIES are the separate income or principal components of a
debt security. The risks associated with stripped securities are similar to
those of other debt securities, although stripped securities may be more
volatile and the value of certain types of stripped securities may move in
the same direction as interest rates. U.S. Treasury securities that have
been stripped by a Federal Reserve Bank are obligations issued by the U.S.
Treasury.
REPURCHASE AGREEMENTS. In a repurchase agreement, a fund buys a security at
one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. A fund can use various techniques to
increase or decrease its exposure to changing security prices, interest
rates, currency exchange rates, commodity prices, or other factors that
affect security values. These techniques may involve derivative
transactions such as buying and selling options and futures contracts,
entering into currency exchange contracts or swap agreements, purchasing
indexed securities, and selling securities short.
FMR can use these practices to adjust the risk and return characteristics
of a fund's portfolio of investments. If FMR judges market conditions
incorrectly or employs a strategy that does not correlate well with a
fund's investments, these techniques could result in a loss, regardless of
whether the intent was to reduce risk or increase return. These techniques
may increase the volatility of a fund and may involve a small investment of
cash relative to the magnitude of the risk assumed. In addition, these
techniques could result in a loss if the counterparty to the transaction
does not perform as promised.
DIRECT DEBT. Loans and other direct debt instruments are interests in
amounts owed to another party by a company, government, or other borrower.
They have additional risks beyond conventional debt securities because they
may entail less legal protection for a fund, or there may be a requirement
that the fund supply additional cash to a borrower on demand.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by
FMR, under the supervision of the Board of Trustees, to be illiquid, which
means that they may be difficult to sell promptly at an acceptable price.
The sale of some illiquid securities and some other securities may be
subject to legal restrictions. Difficulty in selling securities may result
in a loss or may be costly to a fund.
RESTRICTIONS: A fund may not purchase a security if, as a result, more than
10% of its assets would be invested in illiquid securities.
WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS are trading practices in
which payment and delivery for the securities take place at a future date.
The market value of a security could change during this period.
OTHER INSTRUMENTS may include convertible securities, preferred stocks,
securities of closed-end investment companies, real estate-related
instruments and precious metals.
RESTRICTIONS: Asset Manager: Income and Asset Manager may not invest in
precious metals.
CASH MANAGEMENT. Each fund may invest in money market securities, in
repurchase agreements, and in a money market fund available only to funds
and accounts managed by FMR or its affiliates, whose goal is to seek a high
level of current income while maintaining a stable $1.00 share price. A
major change in interest rates or a default on the money market fund's
investments could cause its share price to change.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry.
RESTRICTIONS: With respect to 75% of its total assets, a fund may not
purchase a security if, as a result, more than 5% would be invested in the
securities of any issuer. This limitation does not apply to U.S.
Government securities.
A fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government securities.
BORROWING. A fund may borrow from banks or from other funds advised by FMR,
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.
RESTRICTIONS: A fund may borrow only for temporary or emergency purposes,
but not in an amount exceeding 331/3% of its total assets.
LENDING securities to broker-dealers and institutions, including Fidelity
Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a means of earning
income. This practice could result in a loss or a delay in recovering a
fund's securities. A fund may also lend money to other funds advised by
FMR.
RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of a fund's
total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
ASSET MANAGER: INCOME seeks a high level of current income by allocating
its assets among stocks, bonds, short-term instruments, and other
investments. ASSET MANAGER seeks high total return with reduced risk over
the long term by allocating its assets among stocks, bonds, and short-term
instruments. ASSET MANAGER: GROWTH seeks to maximize total return over the
long term by allocating its assets among stocks, bonds, short-term
instruments, and other investments.
With respect to 75% of its total assets, each fund may not purchase a
security if, as a result, more than 5% would be invested in the securities
of any issuer and may not purchase more than 10% of the outstanding voting
securities of a single issuer.
A fund may not invest more than 25% of its total assets in any one
industry.
A fund may borrow only for temporary or emergency purposes, but not in an
amount exceeding 33% of its total assets.
Loans, in the aggregate, may not exceed 33% of a fund's total assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the funds pay fees related to their daily
operations. Expenses paid out of a fund's assets are reflected in its share
price or dividends; they are neither billed directly to shareholders nor
deducted from shareholder accounts.
Each fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to affiliates who provide
assistance with these services. Each fund also pays OTHER EXPENSES, which
are explained below .
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
fiscal year ended September 1996. Reimbursement arrangements, which may be
terminated at any time without notice, can decrease a fund's expenses and
boost its performance.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fee is
calculated by adding a group fee rate to an individual fund fee rate, and
multiplying the result by the fund's average net assets.
The group fee rate is based on the average net assets of all the mutual
funds advised by FMR. This rate cannot rise above .37% for Asset Manager:
Income and .52% for Asset Manager and Asset Man a ger: Growth and it
drops as total assets under management increase.
UNDERSTANDING THE
MANAGEMENT FEE
The management fee FMR receives is designed to be responsive to changes in
FMR's total assets under management. Building this variable into the fee
calculation assures shareholders that they
will pay a lower rate as FMR's assets under management increase.
(checkmark)

For September 1996, the group fee rate was .1446% for Asset Manager:
Income and .3050% for Asset Manager and Asset Manager: Growth. The
individual fund fee rate is .30 % for Asset Manager: Income,
.25% for Asset Manager and .30% for Asset Manager: Growth. The total
management fee rate for the fiscal year ended 1996, was .49% for Asset
Manager: Income, .68 % for Asset Man ager and, .69% for Asset
Manager: Growth. Effective Au gust 1, 1996, FMR voluntarily agreed to
reduce the individual fund fee rate from .35% to .30% for Asset Manager:
Income, .40% to .25% for Asset Manager, and .40% to .30% for Asset Manager:
Growth. If these reductions were not in effect, the total management fee
rate would have been .50%, .71%, and .71%, respectively, for the fiscal
year ended 1996.
FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These
sub-advisers provide FMR with investment research and advice on issuers
based outside the United States. Under the sub-advisory agreements, FMR
pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively,
of the costs of providing these services.
The sub-advisers may also provide investment management services. In
return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its
management fee rate with respect to a fund's investments that the
sub-adviser manages on a discretionary basis.
OTHER EXPENSES
While the management fee is a significant component of the funds' annual
operating costs, the funds have other expenses as well.
The funds contract with FSC to perform many transaction and accounting
functions. These services include processing shareholder transactions,
valuing each fund's investments, and handling securities loans. For the
fiscal year ended 1996 , Asset Manager: Income, Asset Manager and Asset
Manager: Growth paid FSC fees equa l to .30%, .24%, and .29%,
respe ctively, of average net assets.
The funds also pay other expenses, such as legal, audit, and custodian
fees; proxy solicitation costs; and the compensation of trustees who are
not affiliated with Fidelity. A broker-dealer may use a portion of the
commissions paid by a fund to reduce the fund's custodian or transfer agent
fees.
Each fund has adopted a Distribution and Service Plan. These plans
recognize that FMR may use its resources, including management fees, to pay
expenses associated with the sale of fund shares. This may include payments
to third parties, such as banks or broker-dealers, that provide shareholder
support services or engage in the sale of the fund's shares. It is
important to note, however, that the funds do not pay FMR any separate fees
for this service.
For the fiscal year ended September 1996, th e
portfolio turnover rates for Asset Manager: In co me, Asset
Manager and Asset Manager: Growth were 148 %, 131 %, and
138 %, respectiv ely. These rates vary from year to year. High
turnover rates increase transaction costs and may increase taxable capital
gains. FMR considers these effects when evaluating the anticipated benefits
of short-term investing.
YOUR ACCOUNT

DOING BUSINESS WITH FIDELITY
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, FBSI. Fidelity is also a leader
in providing tax-sheltered retirement plans for individuals investing on
their own or through their employer.
Fidelity is committed to providing investors with practical information to
make investment decisions. Based in Boston, Fidelity provides customers
with complete service 24 hours a day, 365 days a year, through a network of
telephone service centers around the country.
To reach Fidelity for general information, call these numbers:
(small solid bullet) For mutual funds, 1-800-544-8888
(small solid bullet) For brokerage, 1-800-544-7272
If you would prefer to speak with a representative in person, Fidelity has
over 8 0 walk-in Investor Centers across the country.
TYPES OF ACCOUNTS
You may set up an account directly in a fund or, if you own or intend to
purchase individual securities as part of your total investment portfolio,
you may consider investing in a fund through a brokerage account.
You may purchase or sell shares of the funds through an investment
professional, including a broker, who may charge you a transaction fee for
this service. If you invest through FBSI, another financial institution, or
an investment professional, read their program materials for any special
provisions, additional service features or fees that may apply to your
investment in a fund. Certain features of the fund, such as the minimum
initial or subsequent investment amounts, may be modified.
The different ways to set up (register) your account with Fidelity are
listed in the table that follows.
The account guidelines that follow may not apply to certain retirement
accounts. If you are investing through a retirement account or if your
employer offers the funds through a retirement program you may be subject
to additional fees. For more information, please refer to your program
materials, contact your employer or call your retirement benefits number or
Fidelity directly, as appropriate.
FIDELITY FACTS
Fidelity offers the broadest selection of mutual funds
in the world.
(solid bullet) Number of Fidelity mutual funds: over 225
(solid bullet) Assets in Fidelity mutual funds: over $ 432 billion
(solid bullet) Number of shareholder accounts: over 29 million
(solid bullet) Number of investment analysts and portfolio managers:
over 270
(checkmark)
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have two or
more owners (tenants).
RETIREMENT
TO SHELTER YOUR RETIREMENT SAVINGS FROM TAXES
Retirement plans allow individuals to shelter investment income and
capital gains from current taxes. In addition, contributions to these
accounts may be tax deductible. Retirement accounts require special
applications and typically have lower minimums.
(solid bullet) INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow anyone of legal
age and under 70 with earned income to invest up to $2,000 per tax year.
Individuals can also invest in a spouse's IRA if the spouse has earned
income of less than $250.
(solid bullet) ROLLOVER IRAS retain special tax advantages for certain
distributions from employer-sponsored retirement plans.
(solid bullet) KEOGH OR CORPORATE PROFIT SHARING AND MONEY PURCHASE PENSION
PLANS allow self-employed individuals or small business owners (and their
employees) to make tax-deductible contributions for themselves and any
eligible employees up to $30,000 per year.
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide small
business owners or those with self-employed income (and their eligible
employees) with many of the same advantages as a Keogh, but with fewer
administrative requirements.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are available to employees of most
tax-exempt institutions, including schools, hospitals, and other charitable
organizations.
(solid bullet) 401(K) PROGRAMS allow employees of corporations of all sizes
to contribute a percentage of their wages on a tax-deferred basis. These
accounts need to be established by the trustee of the plan.
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and obtain
tax benefits. An individual can give up to $10,000 a year per child without
paying federal gift tax. Depending on state laws, you can set up a
custodial account under the Uniform Gifts to Minors Act (UGMA) or the
Uniform Transfers to Minors Act (UTMA).
TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS
Requires a special application.
HOW TO BUY SHARES
EACH FUND'S SHARE PRICE, called net asset value (NAV), is calculated every
business day. Each fund's shares are sold without a sales charge.
Shares are purchased at the next share price calculated after your
investment is received and accepted. Share price is normally calculated at
4 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application and
mail it along with your check. You may also open your account in person or
by wire as described on page . If there is no application accompanying this
prospectus, call 1-800-544-8888.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail in an application with a check, or
(small solid bullet) Open your account by exchanging from another Fidelity
fund.
IF YOU ARE INVESTING THROUGH A TAX-SHELTERED RETIREMENT PLAN, such as an
IRA, for the first time, you will need a special application. Retirement
investing also involves its own investment procedures. Call 1-800-544-8888
for more information and a retirement application.
If you buy shares by check or Fidelity Money Line(registered trademark),
and then sell those shares by any method other than by exchange to another
Fidelity fund, the payment may be delayed for up to seven business days to
ensure that your previous investment has cleared.
MINIMUM INVESTMENTS

TO OPEN AN ACCOUNT $2,500
For Fidelity IRA, Rollover IRA, SEP-IRA and Keogh accounts $500
TO ADD TO AN ACCOUNT $250
For Fidelity IRA, Rollover IRA, SEP-IRA and Keogh accounts $250
Through regular inv estment plans* $100
MINIMUM BALANCE $2,000
For Fidelity IRA, Rollover IRA, SEP-IRA and Keogh accounts $500
* FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO
"INVESTOR SERVICES," ON PAGE .
These minimums may vary for investments through Fidelity Portfolio Advisory
Services or a Fidelity Payroll Deduction Program account in a fund.
F o r Asset Manager, the minimums may also vary for a Fidelity
Investor Card account or a Fidelity College Savings Plan account in the
fund. There is no minimum account balance or initial or subsequent
investment minimums for certain retirement accounts funded through salary
reduction, or accounts opened with the proceeds of distributions from such
Fidelity retirement accounts. Refer to the program materials for details.

Key Information
Phone 1#800#544#7777
S
To open an account, exchange from another Fidelity fund account with the
same
registration, including name, address, and taxpayer ID number.
S
To add to an account, exchange from another Fidelity fund account with the
same registration, including name, address, and taxpayer ID number. You can

also use Fidelity Money Line to transfer from your bank account. Call
before
your first use to verify that this service is in place on your account.
Maximum
Money Line $50,000
Mail
S
To open an account, complete and sign the application. Make your check
payable
to the complete name of the fund of your choice. Mail to the address
indicated
on the application.
S
To add to an account, make your check payable to the complete name of the
fund
of your choice. Indicate your fund account number on your check and mail to

the address printed on your account statement.
S
Exchange by mail: call 1#800#544#6666 for instructions.
In Person
S
To open an account, bring your application and check to a Fidelity Investor

Center. Call 1#800#544#9797 for the center nearest you.
S
To add to an account, bring your check to a Fidelity Investor Center. Call
1#800#544#9797 for the center nearest you.
Wire
Not available for retirement accounts.
S
To open an account, call 1#800#544#7777 to set up your account and to
arrange
a wire transaction. Wire within 24 hours to the wire address below. Specify

the complete name of the fund and include your new account number and your
name.
S
To add to an account, wire to the wire address below. Specify the complete
name of the fund and include your account number and your name.
S
Wire address: Bankers Trust Company, Bank Routing #021001033, Account #
00163053.
Automatically
New accounts cannot be opened with these services.
S
Use Fidelity Automatic Account Builder or Direct Deposit to automatically
purchase
more shares. Sign up for these services when opening your account, or call
1#800#544#6666.
S
Use Directed Dividends or Fidelity Automatic Exchange Service to
automatically
send money from one Fidelity fund into another. Call 1#800#544#6666 for
instructions.

TDD - Service for the Deaf and Hearing#Impaired: 1#800#544#0118
(null)
How to Sell Shares
You can arrange to take money out of your fund account at any time by
selling
(redeeming) some or all of your shares. Your shares will be sold at the
next
share price calculated after your order is received and accepted. Share
price
is normally calculated at 4 p.m. Eastern time.
To sell shares in a non#retirement account,
you may use any of the methods described on these two pages.
To sell shares in a Fidelity retirement account,
your request must be made in writing, except for exchanges to other
Fidelity
funds, which can be requested by phone or in writing. Call 1#800#544#6666
for
a retirement distribution form.
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).
To sell shares by bank wire or Fidelity Money Line,
you will need to sign up for these services in advance.
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:
S
You wish to redeem more than $100,000 worth of shares,
S
Your account registration has changed within the last 30 days,
S
The check is being mailed to a different address than the one on your
account
(record address),
S
The check is being made payable to someone other than the account owner, or
S
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.
Selling Shares in Writing
Write a "letter of instruction" with:
S
Your name,
S
The fund's name,
S
Your fund account number,
S
The dollar amount or number of shares to be redeemed, and
S
Any other applicable requirements listed in the table that follows.
Unless otherwise instructed, Fidelity will send a check to the record
address.
Deliver your letter to a Fidelity Investor Center, or mail it to:
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266#0602
Key Information
Phone 1#800#544#7777
All account types except retirement
S
Maximum check request: $100,000.
S
For Money Line transfers to your bank account; minimum: $10; maximum:
$100,000.
All account types
S
You may exchange to other Fidelity funds if both accounts are registered
with
the same name(s), address, and taxpayer ID number.
Mail or in Person
Individual, Joint Tenant, Sole Proprietorship, UGMA, UTMA
S
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
S
The account owner should complete a retirement distribution form. Call
1#800#544#6666
to request one.
Trust
S
The trustee must sign the letter 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
S
At least one person authorized by corporate resolution to act on the
account
must sign the letter.
S
Include a corporate resolution with corporate seal or a signature
guarantee.
Executor, Administrator, Conservator, Guardian
S
Call 1#800#544#6666 for instructions.
Wire
All account types except retirement
S
You must sign up for the wire feature before using it. To verify that it is

in place, call 1#800#544#6666. Minimum wire: $5,000.
S
Your wire redemption request must be received by Fidelity before 4 p.m.
Eastern
time for money to be wired on the next business day.

TDD - Service for the Deaf and Hearing#Impaired: 1#800#544#0118
YOUR ACCOUNT

INVESTOR SERVICES
Fidelity provides a variety of services to help you manage your account.
INFORMATION SERVICES
FIDELITY'S TELEPHONE REPRESENTATIVES are available 24 hours a day, 365 days
a year. Whenever you call, you can speak with someone equipped to provide
the information or service you need.
STATEMENTS AND REPORTS that Fidelity sends to you include the following:
(small solid bullet) Confirmation statements (after every transaction,
except reinvestments, that affects your account balance or your account
registration)
(small solid bullet) Account statements (quarterly)
(small solid bullet) Financial reports (every six months)
To reduce expenses, only one copy of most financial reports a nd
prospect uses will be mailed to your household, even if you have more
than one account in the fund. Call 1-800-544-6666 if you need copies of
financial reports, pro spectus es, or historical account information.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of other
Fidelity funds by telephone or in writing.
Note that exchanges out of a fund are limited to four per calendar year,
and that they may have tax consequences for you. For details on policies
and restrictions governing exchanges, including circumstances under which a
shareholder's exchange privilege may be suspended or revoked, see page.
SYSTEMATIC WITHDRAWAL PLANS let you set up periodic redemptions from your
account.
FIDELITY MONEY LINE enables you to transfer money by phone between your
bank account and your fund account. Most transfers are complete within
three business days of your call.

24-HOUR SERVICE
ACCOUNT ASSISTANCE 1-800-544-6666
ACCOUNT TRANSACTIONS 1-800-544-7777
PRODUCT INFORMATION 1-800-544-8888
RETIREMENT ACCOUNT ASSISTANCE
1-800-544-4774
TOUCHTONE XPRESSSM 1-800-544-5555
AUTOMATED SERVICE
(checkmark)
REGULAR INVESTMENT PLANS
One easy way to pursue your financial goals is to invest money regularly.
Fidelity offers convenient services that let you transfer money into your
fund account, or between fund accounts, automatically. While regular
investment plans 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. Certain restrictions apply for retirement accounts. Call
1-800-544-6666 for more information.
REGULAR INVESTMENT PLANS
FIDELITY AUTOMATIC ACCOUNT BUILDERSM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY FUND

<TABLE>
<CAPTION>
<S> <C> <C>
MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 Monthly or quarterly (small solid bullet) For a new account, complete the appropriate section on the fund
application.
(small solid bullet) For existing accounts, call 1-800-544-6666 for an application.
(small solid bullet) To change the amount or frequency of your investment, call
1-800-544-6666 at least three business days prior to your next
scheduled investment date.

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 Every pay period (small solid bullet) Check the appropriate box on the fund application, or call
1-800-544-6666 for an authorization form.
(small solid bullet) Changes require a new authorization form.

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 Monthly, bimonthly, (small solid bullet) To establish, call 1-800-544-6666 after both accounts are opened.
quarterly, or annually (small solid bullet) To change the amount or frequency of your investment, call
1-800-544-6666.

</TABLE>

A BECAUSE THEIR SHARE PRICES FLUCTUATE, THESE FUNDS MAY NOT BE APPROPRIATE
CHOICES FOR DIRECT DEPOSIT OF YOUR ENTIRE CHECK.
SHAREHOLDER AND ACCOUNT POLICIES

DIVIDENDS, CAPITAL GAINS, AND TAXES
Each fund distributes substantially all of its net income and capital gains
to shareholders each year.
DISTRIBUTION SCHEDULE

Dividends Capital gains

Asset Manager: Income Monthly December

Asset Manager March, June, December
September,
and
December

Asset Manager: Growth December December

DISTRIBUTION OPTIONS
When you open an account, specify on your application how you want to
receive your distributions. If the option you prefer is not listed on the
application, call 1-800-544-6666 for instructions. Each fund offers four
options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions will
be automatically reinvested in additional shares of the fund. If you do not
indicate a choice on your application, you will be assigned this option.
2. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested, but you will be sent a check for each dividend
distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions.
4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and
capital gain distributions will be automatically invested in another
identically registered Fidelity fund.
FOR RETIREMENT ACCOUNTS, all distributions are automatically reinvested.
When you are over 59 years old, you can receive distributions in cash.
When a fund deducts a distribution from its NAV, the reinvestment price is
the fund's NAV at the close of business that day. Cash distribution checks
will be mailed within seven days.
TAXES
As with any investment, you should consider how your investment in a fund
will be taxed. If your account is not a tax-deferred retirement account,
you should be aware of these tax implications.
TAXES ON DISTRIBUTIONS. Distributions are subject to federal income tax,
and may also be subject to state or local taxes. If you live outside the
United States, your distributions could also be taxed by the country in
which you reside. Your distributions are taxable when they are paid,
whether you take them in cash or reinvest them. However, distributions
declared in December and paid in January are taxable as if they were paid
on December 31.
For federal tax purposes, each fund's income and short-term capital gain
distributions are taxed as dividends; long-term capital gain distributions
are taxed as long-term capital gains. Every January, Fidelity will send you
and the IRS a statement showing the taxable distributions paid to you in
the previous year.
TAXES ON TRANSACTIONS. Your redemptions - including exchanges to other
Fidelity funds - are subject to capital gains tax. A capital gain or loss
is the difference between the cost of your shares and the price you receive
when you sell them.
Whenever you sell shares of a fund, Fidelity will send you a confirmation
statement showing how many shares you sold and at what price. You will also
receive a consolidated transaction statement every January. However, it is
up to you or your tax preparer to determine whether this sale resulted in a
capital gain and, if so, the amount of tax to be paid. Be sure to keep your
regular account statements; the information they contain will be essential
in calculating the amount of your capital gains.
"BUYING A DIVIDEND." If you buy shares when a fund has realized but not yet
distributed income or capital gains, you will pay the full price for the
shares and then receive a portion of the price back in the form of a
taxable distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on a fund and
its investments and these taxes generally will reduce the fund's
distributions. However, an offsetting tax credit or deduction may be
available to you. If so, your tax statement will show more taxable income
or capital gains than were actually distributed by the fund, but will also
show the amount of the available offsetting credit or deduction.
There are tax requirements that all funds must follow in order to avoid
federal taxation. In its effort to adhere to these requirements, a fund may
have to limit its investment activity in some types of instruments.
TRANSACTION DETAILS
THE FUNDS ARE OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE)
is open. Fidelity normally calculates each fund's NAV as of the close of
business of the NYSE, normally 4 p.m. Eastern time.
EACH FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and then dividing the result by the number of
shares outstanding.
The funds' assets are valued primarily on the basis of market quotations.
Foreign securities are valued on the basis of quotations from the primary
market in which they are traded, and are translated from the local currency
into U.S. dollars using current exchange rates. Short-term securities with
remaining maturities of sixty days or less for which quotations are not
readily available are valued on the basis of amortized cost. This method
minimizes the effect of changes in a security's market value. In addition,
if quotations are not readily available, or if the values have been
materially affected by events occurring after the closing of a foreign
market, assets may be valued by a method that the Board of Trustees
believes accurately reflects fair value.
EACH FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION PRICE
(price to sell one share) are its NAV.
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.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does not
follow reasonable procedures designed to verify the identity of the caller.
Fidelity will request personalized security codes or other information, and
may also record calls. You should verify the accuracy of your confirmation
statements immediately after you receive them. If you do not want the
ability to redeem and exchange by telephone, call Fidelity for
instructions.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods
of unusual market activity), consider placing your order by mail or by
visiting a Fidelity Investor Center.
EACH FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. Each fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they would
disrupt management of a fund.

UNDERSTANDING DISTRIBUTIONS
As a fund shareholder, you are entitled to your share of the fund's net
income and gains on its investments. The fund passes its earnings along to
its investors as DISTRIBUTIONS.
Each fund earns dividends from stocks and interest from bond, money market,
and other investments. These are passed along as DIVIDEND DISTRIBUTIONS.
The fund realizes capital gains whenever it
sells securities for a higher price than it paid for them. These are passed
along as CAPITAL GAIN DISTRIBUTIONS.
(checkmark)
WHEN YOU PLACE AN ORDER TO BUY SHARES, your order will be processed at the
next offering price calculated after your order is received and accepted.
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) Each fund 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
cancelled and you could be liable for any losses or fees a fund or its
transfer agent has incurred.
TO AVOID THE COLLECTION PERIOD associated with check and Money Line
purchases, consider buying shares by bank wire, U.S. Postal money order,
U.S. Treasury check, Federal Reserve check, or direct deposit instead.
CERTAIN FINANCIAL INSTITUTIONS that have entered into sales agreements with
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
financial institution could be held liable for resulting fees or losses.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your request is received and accepted. Note the
following:
(small solid bullet) Normally, redemption proceeds will be mailed to you on
the next business day, but if making immediate payment could adversely
affect a fund, it may take up to seven days to pay you.
(small solid bullet) Fidelity Money Line redemptions generally will be
credited to your bank account on the second or third business day after
your phone call.
(small solid bullet) Each fund may hold payment on redemptions until it is
reasonably satisfied that investments made by check or Fidelity Money Line
have been collected, which can take up to seven business days.
(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.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of
$12.00 from accounts w ith a value of less than $2,500, 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 the transfer agent, 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 ac counts), accounts
using regular investment plans, or if total assets in Fidelity exceed
$30,000. Eligibility for the $30,000 waiver is determined by
aggregating Fidelity accounts maintained by FSC 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, yo u will be given 30
days' notice to reestablish the minimum balance. If you do not increase
your balance, Fidelity reserves the right to close your account and send
the proceeds to you. Your shares will be redeemed at the NAV on the day
your account is closed.
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
FDC may, at its own expense, provide promotional incentives to qualified
recipients who support the sale of shares of the funds without
reimbursement from the funds. Qualified recipients are securities dealers
who have sold fund shares or others, including banks and other financial
institutions, under special arrangements in connection with FDC's sales
activities. In some instances, these incentives may be offered only to
certain institutions whose representatives provide services in connection
with the sale or expected sale of significant amounts of shares.
EXCHANGE RESTRICTIONS
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:
(small solid bullet) The fund you are exchanging into must be available for
sale in your state.
(small solid bullet) You may only exchange 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) If you exchange into a fund with a sales charge, you
pay the percentage-point difference between that fund's sales charge and
any sales charge you have previously paid in connection with the shares you
are exchanging. For example, if you had already paid a sales charge of 2%
on your shares and you exchange them into a fund with a 3% sales charge,
you would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Because excessive trading can hurt fund performance
and shareholders, each fund reserves the right to temporarily or
permanently terminate the exchange privilege of any investor who makes more
than four exchanges out of the fund per calendar year. Accounts under
common ownership or control, including accounts with the same taxpayer
identification number, will be counted together for purposes of the four
exchange limit.
(small solid bullet) The exchange limit may be modified for accounts in
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 reserves the right to 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.
(small solid bullet) Your exchanges may be restricted or refused if a fund
receives or anticipates simultaneous orders affecting significant portions
of the fund's assets. In particular, a pattern of exchanges that coincides
with a "market timing" strategy may be disruptive to a fund.
Although the funds will attempt to give you prior notice whenever they are
reasonably able to do so, they may impose these restrictions at any time.
The funds reserve the right to terminate or modify the exchange privilege
in the future.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50% on
exchanges. Check each fund's prospectus for details.
The Fidelity Pyramid and Logo, Fidelity Money Line, and Directed Dividends
are registered trademarks of FMR Corp. Fidelity Asset Manager, Fidelity
Automatic Account Builder, and TouchTone Xpress are trademarks of FMR Corp.
This prospectus is printed on recycled paper using soy-based inks.

FIDELITY CHARLES STREET TRUST:
FIDELITY ASSET MANAGER FUNDS

CROSS REFERENCE SHEET

FORM N-1A

ITEM NUMBER STATEMENT OF ADDITIONAL INFORMATION SECTION

<TABLE>
<CAPTION>
<S> <C> <C> <C>
10, 11 ............................ Cover Page, Table of Contents

12 ............................ Description of the Trust

13 a - c ............................ Investment Policies and Limitations

d ............................ Portfolio Transactions

14 a - c ............................ Trustees and Officers

15 a ............................ *

b ............................ Description of the Trust

c ............................ Trustees and Officers

16 a i ............................ FMR, Portfolio Transactions

ii ............................ Trustees and Officers

iii ............................ Management Contracts

b ............................ Management Contracts

c, d ............................ Contracts with FMR Affiliates

e ............................ *

f ............................ Distribution and Service Plans

g ............................ *

h ............................ Description of the Trust

i ............................ Contracts with FMR Affiliates

17 a - c ............................ Portfolio Transactions

d, e ............................ *

18 a ............................ Description of the Trust

b ............................ *

19 a ............................ Additional Purchase and Redemption Information

b ............................ Additional Purchase and Redemption Information;
Valuation of Portfolio Securities

c ............................ *

20 ............................ Distributions and Taxes

21 a, b ............................ Contracts with FMR Affiliates

c ............................ *

22 a, b ............................ Performance

23 ............................ Financial Statements for the fiscal period ended
September 30, 1996 are incorporated herein by
reference.

</TABLE>

* Not Applicable
FIDELITY ASSET MANAGER: INCOME
FIDELITY ASSET MANAGER(Trademark)
FIDELITY ASSET MANAGER: GROWTH
FUNDS OF FIDELITY CHARLES STREET TRUST
STATEMENT OF ADDITIONAL INFORMATION
FEBRUARY 17, 1997
This Statement of Additional Information (SAI) is not a prospectus
but should be read in conjunction with the funds' current Prospectus
(dated February 17, 1997 ). Please retain this document for future
reference. The funds' Annual Reports are separate documents supp l ied
with this SAI. To obtain a free additional copy of the Prospectus or Annual
Report, please call Fidelity Distributors Corporation (FDC) at
1-800-544-8888.
TABLE OF CONTENTS PAGE

Investment Policies and Limitations

Portfolio Transactions

Valuation of Portfolio Securities

Performance

Additional Purchase and Redemption Information

Distributions and Taxes

FMR

Trustees and Officers

Management Contracts

Distribution and Service Plans

Contracts with FMR Affiliates

Description of the Trust

Financial Statements

Appendix

INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc. (FMR U.K.)
Fidelity Management & Research (Far East) Inc. (FMR Far East)
DISTRIBUTOR
FDC
TRANSFER AGENT
Fidelity Service Company, Inc. (FSC)

For more information on any Fidelity Fund, including charges and
expenses, call or write for a free prospectus. Read it carefully before you
invest or send money.
FFM-ptb-1196-01
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.
The funds' 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) of the fund.
However, except for the fundamental investment limitations listed below,
the investment policies and limitations described in this Statement of
Additional Information are not fundamental and may be changed without
shareholder approval.
INVESTMENT LIMITATIONS OF ASSET MANAGER: INCOME
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) 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 as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that the
fund may be considered an underwriter within the meaning of the Securities
Act of 1933 in the disposition of restricted securities;
(5) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical
commodities); or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(9) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (3)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 7.5% of the
fund's net assets) to a registered investment company or portfolio for
which FMR or an affiliate serves as investment adviser or (b) acquiring
loans, loan participations, or other forms of direct debt instruments and,
in connection therewith, assuming any associated unfunded commitments of
the sellers. (This limitation does not apply to purchases of debt
securities or to repurchase agreements.)
( vi ) The fund does not currently intend to invest all of its assets
in the securities of a single open-end management investment company with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
INVESTMENT LIMITATIONS OF ASSET MANAGER
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) 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 as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that the
fund may be deemed to be 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;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical
commodities); or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(9) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (3)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 5% of the
fund's net assets) to a registered investment company or portfolio for
which FMR or an affiliate serves as investment adviser or (b) acquiring
loans, loan participations, or other forms of direct debt instruments and,
in connection therewith, assuming any associated unfunded commitments of
the sellers. (This limitation does not apply to purchases of debt
securities or to repurchase agreements.)
( vi ) The fund does not currently intend to invest all of its assets
in the securities of a single open-end management investment company with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
INVESTMENT LIMITATIONS OF ASSET MANAGER: GROWTH
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) 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 as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that the
fund may be deemed to be 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;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent
the fund from purchasing and selling precious metals, or from purchasing or
selling options and futures contracts or from investing in securities or
other instruments backed by physical commodities); or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this limit
does not apply to purchases of debt securities or to repurchase agreements.
(9) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (3)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 5% of the
fund's net assets) to a registered investment company or portfolio for
which FMR or an affiliate serves as investment adviser or (b) acquiring
loans, loan participations, or other forms of direct debt instruments and,
in connection therewith, assuming any associated unfunded commitments of
the sellers. (This limitation does not apply to purchases of debt
securities or to repurchase agreements.)
( vi ) The fund does not currently intend to invest more than 5% of
its total assets in precious metals.
( v ii) 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 the funds' limitations on futures and options transactions, see the
section entitled "Limitations on Futures and Options Transactions" on page
.
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 the 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 Investment Company Act of 1940. These
transactions may include 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 ALLOCATION. The stock class includes domestic and foreign equity
securities of all types (other than adjustable rate preferred stocks which
are included in the bond class). FMR seeks to maximize total return within
this asset class by actively allocating assets to industry sectors expected
to benefit from major trends, and to individual stocks that FMR believes to
have superior investment potential. When FMR selects equity securities, it
considers both growth and anticipated dividend income. Securities in the
stock class may include common stocks, fixed-rate preferred stocks
(including convertible preferred stocks), warrants, rights, depositary
receipts, securities of closed-end investment companies, and other equity
securities issued by companies of any size, located anywhere in the world.
The bond class includes all varieties of domestic and foreign fixed-income
securities maturing in more than one year. FMR will seek to maximize total
return within the bond class by adjusting the fund's investments in
securities with different credit qualities, maturities, and coupon or
dividend rates, and by seeking to take advantage of yield differentials
between securities. Securities in this class may include bonds, notes,
adjustable-rate preferred stocks, convertible bonds, mortgage-related and
asset-backed securities, domestic and foreign government and government
agency securities, zero coupon bonds, and other intermediate and long-term
securities. These securities may be denominated in U.S. dollars or foreign
currency. Asset Manager and Asset Manager: Growth may also invest in lower
quality, high-yielding debt securities (commonly referred to as "junk
bonds"). Asset Manager and Asset Manager: Growth currently intend to limit
their investments in these securities to less than 35% of their assets.
Asset Manager: Income may invest up to 5% of its assets in lower-quality
convertible bonds.
The short-term/money market class includes all types of domestic and
foreign short-term and money market instruments. FMR will seek to maximize
total return with respect to Asset Manager and Asset Manager: Growth, and
will seek to maximize income with respect to Asset Manager: Income, within
this asset class by taking advantage of yield differentials between
different instruments, issuers, and currencies. Short-term and money market
instruments may include corporate debt securities, such as commercial paper
and notes; government securities issued by U.S. or foreign governments or
their agencies or instrumentalities; bank deposits and other financial
institution obligations; repurchase agreements involving any type of
security; and other similar short-term instruments. These instruments may
be denominated in U.S. dollars or foreign currency.
FMR may use its judgment to place a security in the most appropriate class
based on its investment characteristics. Fixed-income securities may be
classified in the bond or short-term/money market class according to
interest rate sensitivity as well as maturity. The funds may also make
other investments that do not fall within these classes. In making asset
allocation decisions, FMR will evaluate projections of risk, market
conditions, economic conditions, volatility, yields, and returns. FMR's
management will use database systems to help analyze past situations and
trends, research specialists in each of the asset classes to help in
securities selection, portfolio management professionals to determine asset
allocation and to select individual securities, and its own credit analysis
as well as credit analyses provided by rating services.
ASSET-BACKED SECURITIES. Asset-backed securities represent interests in
pools of consumer loans (generally unrelated to mortgage loans) and most
often are structured as pass-through securities. Interest and principal
payments ultimately depend upon payment of the underlying loans by
individuals, although the securities may be supported by letters of credit
or other credit enhancements. The value of asset-backed securities may also
depend on the creditworthiness of the servicing agent for the loan pool,
the originator of the loans, or the financial institution providing the
credit enhancement.
CLOSED-END INVESTMENT COMPANIES. Each fund may purchase the shares of
closed-end investment companies to facilitate investment in certain
countries. Shares of closed-end investment companies may trade at a premium
or a discount to their net asset value.
DELAYED-DELIVERY TRANSACTIONS. Each fund may buy and sell securities on a
delayed-delivery or when-issued basis. These transactions involve a
commitment by a fund to purchase or sell specific securities at a
predetermined price or yield, with payment and delivery taking place after
the customary settlement period for that type of security. Typically, no
interest accrues to the purchaser until the security is delivered. The
funds may receive fees for entering into delayed-delivery transactions.
When purchasing securities on a delayed-delivery basis, each fund assumes
the rights and risks of ownership, including the risk of price and yield
fluctuations. Because a fund is not required to pay for securities until
the delivery date, these risks are in addition to the risks associated with
the fund's other investments. If a fund remains substantially fully
invested at a time when delayed-delivery purchases are outstanding, the
delayed-delivery purchases may result in a form of leverage. When
delayed-delivery purchases are outstanding, the fund will set aside
appropriate liquid assets in a segregated custodial account to cover its
purchase obligations. When a fund has sold a security on a delayed-delivery
basis, 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, the fund could miss
a favorable price or yield opportunity, or could suffer a loss.
Each fund may renegotiate delayed-delivery transactions after they are
entered into, and may sell underlying securities before they are delivered,
which may result in capital gains or losses.
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. 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.
Foreign investments involve a risk of local political, economic, 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 the possibility of
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. There
is no assurance that FMR will be able to anticipate these potential events
or counter their effects. These risks are magnified for investments in
developing countries, which may have relatively unstable governments,
economies based on only a few industries, and securities markets that trade
a small number of securities.
Economies of particular countries or areas of the world may differ
favorably or unfavorably from the economy of the United States. Foreign
markets may offer less protection to investors than U.S. markets. It is
anticipated that in most cases the best available market for foreign
securities will be on an exchange or in over-the-counter 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 (particularly those
located in developing countries) may be less liquid and more volatile than
securities of comparable U.S. issuers. Foreign security trading practices,
including those involving securities settlement where fund assets may be
released prior to receipt of payment, may result in increased risk in the
event of a failed trade or the insolvency of a foreign broker-dealer, and
may involve substantial delays. In addition, the costs of foreign
investing, including withholding taxes, brokerage commissions and custodial
costs, are generally higher than for U.S. investors. In general, there is
less overall governmental supervision and regulation of securities
exchanges, brokers, and listed companies than in the United States. It may
also be difficult to enforce legal rights in foreign countries. 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.
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 depositary 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 depositary 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 an alternative 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.
FOREIGN CURRENCY TRANSACTIONS. A 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 conversion s , 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 currency to be delivered at a specific 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. A fund may use currency forward contracts for any purpose
consistent with its investment objective.
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 prices 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 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.
Under certain conditions, SEC guidelines require mutual funds to set aside
appropriate liquid assets in a segregated custodial account to cover
currency forward contracts. As required by SEC guidelines, a fund
will segregate assets to cover currency forward contracts, if any, whose
purpose is essentially speculative. A fund will not segregate assets
to cover forward contracts entered into for hedging purposes, including
settlement hedges, position hedges, and proxy hedges.
Successful use of currency management strategies will depend on FMR's skill
in analyzing and predicting 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 be able to
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 time s .
FUNDS' RIGHTS AS A SHAREHOLDER. The funds do not intend to direct or
administer the day-to-day operations of any company. Each 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 that a fund may engage in, 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 sections pertain to futures and options:
Asset Coverage for Futures and Options Positions, 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.
ASSET COVERAGE FOR FUTURES AND OPTIONS POSITIONS. The funds will comply
with guidelines established by the Securities and Exchange Commission with
respect to coverage of options and futures strategies by mutual funds, and
if the guidelines so require will set aside appropriate liquid assets in a
segregated custodial account in the amount prescribed. Securities held in a
segregated account cannot be sold while the futures or option strategy is
outstanding, unless they are replaced with other suitable assets. As a
result, there is a possibility that segregation of a large percentage of a
fund's assets could impede portfolio management or the fund's ability to
meet redemption requests or other current obligations.
COMBINED POSITIONS. A fund may purchase and write 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, a fund may purchase a put option and write a call option on the
same underlying instrument, in order to 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, in order 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. The funds may invest in options and
futures contracts based on securities with different issuers, maturities,
or other characteristics from the securities in which they typically
invest, which involves a risk that the options or futures position will not
track the performance of a 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. When a fund purchases a futures contract, it agrees to
purchase a specified underlying instrument at a specified future date. When
a fund sells a futures contract, it agrees to sell the underlying
instrument at a specified future date. The price at which the purchase and
sale will take place is fixed when the fund enters into the contract. Some
currently available futures contracts are based on specific securities,
such as U.S. Treasury bonds or notes, and some are based on indices of
securities prices, such as the Standard & Poor's 500 Index (S&P
500(registered trademark)). Futures can be held until their delivery dates,
or can be closed out before then if a liquid secondary market is available.
The value of a futures contract tends to increase and decrease in tandem
with the value of its underlying instrument. Therefore, purchasing futures
contracts will tend to increase a fund's exposure to positive and negative
price fluctuations in the underlying instrument, much as if it had
purchased the underlying instrument directly. When a fund sells a futures
contract, by contrast, the value of its futures position will tend to move
in a direction contrary to the market. Selling futures contracts,
therefore, will tend to offset both positive and negative market price
changes, much as if the underlying instrument had been sold.
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 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 fund will not: (a) sell futures contracts, purchase put
options, or write call options if, as a result, more than 25% of the fund's
total assets would be hedged with futures and options under normal
conditions; (b) purchase futures contracts or write put options if, as a
result, the fund's total obligations upon settlement or exercise of
purchased futures contracts and written put options would exceed 25% of its
total assets; or (c) purchase call options if, as a result, the current
value of option premiums for call options purchased by the fund would
exceed 5% of the fund's total assets. These limitations do not apply to
options attached to or acquired or traded together with their underlying
securities, and do not apply to securities that incorporate features
similar to options.
The above limitations on the funds' investments in futures contracts and
options, and the funds' policies regarding futures contracts and options
discussed elsewhere in this SAI, may be changed as regulatory agencies
permit.
LIQUIDITY OF OPTIONS AND FUTURES CONTRACTS. There is no assurance a liquid
secondary market will exist for any particular options or futures contract
at any particular time. Options may have relatively low trading volume and
liquidity if their strike prices are not close to the underlying
instrument's current price. In addition, exchanges may establish daily
price fluctuation limits for options and futures contracts, and may halt
trading if a contract's price moves upward or downward more than the limit
in a given day. On volatile trading days when the price fluctuation limit
is reached or a trading halt is imposed, it may be impossible for a fund 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. The
funds may purchase and sell currency futures and may purchase and write
currency options to increase or decrease their exposure to different
foreign currencies. A fund may also purchase and write currency options 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 funds 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.
PRECIOUS METALS. The prices of gold and other commodities can change
rapidly, and generally do not move in tandem with the prices of equity and
debt securities.
PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, a fund 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 fund 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 fund
may terminate its position in a put option it has purchased by allowing it
to expire or by exercising the option. If the option is allowed to expire,
the fund will lose the entire premium it paid. If the fund exercises the
option, it completes the sale of the underlying instrument at the strike
price. A fund 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
paid, 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. When a fund writes a put option, it takes the
opposite side of the transaction from the option's purchaser. In return for
receipt of the premium, the fund 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. When writing an option on a futures
contract, the fund will be required to make margin payments to an FCM as
described above for futures contracts. A fund may seek to terminate its
position in a put option it writes 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 the fund has written, however, the
fund must continue to be prepared to pay the strike price while the option
is outstanding, regardless of price changes, and must continue to set aside
assets to cover its position.
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 a fund 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 INVESTMENTS are investments that cannot be sold or disposed of in
the ordinary course of business at approximately the prices at which they
are valued. 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 instruments. In determining the
liquidity of a fund's investments, FMR may consider various factors,
including (1) the frequency of trades and quotations, (2) the number of
dealers and prospective purchasers in the marketplace, (3) dealer
undertakings to make a market, (4) the nature of the security (including
any demand or tender features), and (5) the nature of the marketplace for
trades (including the ability to assign or offset the fund's rights and
obligations relating to the investment).
Investments currently considered by the funds to be illiquid include
repurchase agreements not entitling the holder to payment of principal and
interest within seven days, over-the-counter options, and non-government
stripped fixed-rate mortgage-backed securities. Also, FMR may determine
some restricted securities, government-stripped fixed-rate mortgage-backed
securities, loans and other direct debt instruments, emerging market
securities, and swap agreements to be illiquid. However, with respect to
over-the-counter options a fund writes, all or a portion of the value of
the underlying instrument may be illiquid depending on the assets held to
cover the option and the nature and terms of any agreement the fund may
have to close out the option before expiration.
In the absence of market quotations, illiquid investments are priced at
fair value as determined in good faith by a committee appointed by the
Board of Trustees. 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 seek to take
appropriate steps to protect liquidity.
INDEXED SECURITIES. Each fund may purchase securities 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, for
example, 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 of equivalent issuers. 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. At the same time, indexed securities are 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. FMR will use its
judgment in determining whether indexed securities should be treated as
short-term instruments, bonds, stocks, or as a separate asset class for
purposes of the funds' investment allocations, depending on the individual
characteristics of the securities. Indexed securities may be more volatile
than the underlying instruments.
INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive order
issued by the SEC, each fund has received permission to lend money to, and
borrow money from, other funds advised by FMR or its affiliates. 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
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. A fund may have to borrow from a bank at a higher interest
rate if an interfund loan is called or not renewed. Any delay in repayment
to a lending fund could result in a lost investment opportunity or
additional borrowing costs.
LOANS AND OTHER DIRECT DEBT INSTRUMENTS. Direct debt instruments are
interests in amounts owed by a corporate, governmental, or other borrower
to lenders or lending syndicates (loans and loan participations), to
suppliers of goods or services (trade claims or other receivables), or to
other parties. Direct debt instruments are subject to each fund's policies
regarding the quality of debt securities.
Purchasers of loans and other forms of direct indebtedness depend primarily
upon the creditworthiness of the borrower for payment of principal and
interest. Direct debt instruments may not be rated by any nationally
recognized rating service. If a fund does not receive scheduled interest or
principal payments on such indebtedness, the fund's share price and yield
could be adversely affected. Loans that are fully secured offer a fund more
protections than an unsecured loan in the event of non-payment of scheduled
interest or principal. 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 to a fund.
For example, if a loan is foreclosed, the fund 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, the fund 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. Direct debt
instruments that are not in the form of securities may offer less legal
protection to a fund in the event of fraud or misrepresentation. In the
absence of definitive regulatory guidance, each fund relies on FMR's
research in an attempt to avoid situations where fraud or misrepresentation
could adversely affect the fund.
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, each fund has direct recourse against the borrower, it
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 fund were
determined to be subject to the claims of the agent's general creditors,
the fund 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 purchased by each fund may include letters of credit,
revolving credit facilities, or other standby financing commitments
obligating the fund to pay additional cash on demand. These commitments may
have the effect of requiring the fund 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 will set aside appropriate liquid assets in a segregated
custodial account to cover its potential obligations under standby
financing commitments.
Each fund limits the amount of total assets that it will invest in any one
issuer or in issuers within the same industry (see limitations (1) and (5)
for each fund ). For purposes of these limitations, each 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 each fund and the
borrower, if the participation does not shift to the fund the direct
debtor-creditor relationship with the borrower, SEC interpretations require
the 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. While the market for high-yield corporate
debt securities has been in existence for many years and has weathered
previous economic downturns, the 1980s brought a dramatic increase in the
use of such securities to fund highly leveraged corporate acquisitions and
restructurings. Past experience may not provide an accurate indication of
the future performance of the high-yield bond market, especially during
periods of economic recession.
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. If market quotations are not
available, lower-quality debt securities will be valued in accordance with
procedures established by the Board of Trustees, including the use of
outside pricing services. Judgment plays a greater role in valuing
high-yield corporate debt securities than is the case for securities for
which more external sources for quotations and last-sale information are
available. Adverse publicity and changing investor perceptions may affect
the ability of outside pricing services to value lower-quality debt
securities and a fund's ability to dispose of these securities.
Since 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 held by a fund. In considering investments
for the fund, 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.
Each fund may choose, at its expense or in conjunction with others, to
pursue litigation or otherwise to exercise its rights as a security holder
to seek to protect the interests of security holders if it determines this
to be in the best interest of the fund's shareholders.
MORTGAGE-BACKED SECURITIES. The funds may purchase mortgage-backed
securities issued by government and non-government entities such as banks,
mortgage lenders, or other financial institutions. A mortgage-backed
security is an obligation of the issuer backed by a mortgage or pool of
mortgages or a direct interest in an underlying pool of mortgages. Some
mortgage-backed securities, such as collateralized mortgage obligations or
CMOs, make payments of both principal and interest at a variety of
intervals; others make semiannual interest payments at a predetermined rate
and repay principal at maturity (like a typical bond). Mortgage-backed
securities are based on different types of mortgages including those on
commercial real estate or residential properties. Other types of
mortgage-backed securities will likely be developed in the future, and the
funds may invest in them if FMR determines they are consistent with the
funds' investment objective and policies.
The value of mortgage-backed securities may change due to shifts in the
market's perception of issuers. In addition, regulatory or tax changes may
adversely affect the mortgage securities market as a whole. Non-government
mortgage-backed securities may offer higher yields than those issued by
government entities, but also may be subject to greater price changes than
government issues. Mortgage-backed securities are subject to prepayment
risk. Prepayment, which occurs when unscheduled or early payments are made
on the underlying mortgages, may shorten the effective maturities of these
securities and may lower their total returns.
REAL ESTATE-RELATED INSTRUMENTS include real estate investment trusts,
commercial and residential mortgage-backed securities, and real estate
financings. Real estate-related instruments are sensitive to factors such
as real estate values and property taxes, interest rates, cash flow of
underlying real estate assets, overbuilding, and the management skill and
creditworthiness of the issuer. Real estate-related instruments may also be
affected by tax and regulatory requirements, such as those relating to the
environment.
REPURCHASE AGREEMENTS. In a repurchase agreement, a fund purchases a
security and simultaneously commits 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. To protect the fund
from the risk that the original seller will not fulfill its obligation, the
securities are held in an account of the fund at a bank, marked-to-market
daily, and maintained at a value at least equal to the sale price plus the
accrued incremental amount. While it does not presently appear possible to
eliminate all risks from these transactions (particularly the possibility
that the value of the underlying security will be less than the resale
price, as well as delays and costs to a fund in connection with bankruptcy
proceedings), it is each fund's current policy to engage in repurchase
agreement transactions with parties whose creditworthiness has been
reviewed and found satisfactory by FMR.
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, a fund 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, a fund 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 portfolio instrument to another party, such as a bank or
broker-dealer, in return for cash and agrees to repurchase the instrument
at a particular price and time. While a reverse repurchase agreement is
outstanding, the fund will maintain appropriate liquid assets in a
segregated custodial account to cover its obligation under the agreement. A
fund will enter into reverse repurchase agreements only with parties whose
creditworthiness has been found satisfactory by FMR. Such transactions may
increase fluctuations in the market value of the fund's assets and may be
viewed as a form of leverage.
SECURITIES LENDING. A fund may lend securities to parties such as
broker-dealers or institutional investors, 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. Since 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 any security in
which a fund is authorized to invest. Investing this cash subjects that
investment, as well as the security loaned, to market forces (i.e., capital
appreciation or depreciation).
SHORT SALES. A fund may enter into short sales with respect to stocks
underlying its convertible security holdings. For example, if FMR
anticipates a decline in the price of the stock underlying a convertible
security a fund holds, it may sell the stock short. If the stock price
subsequently declines, the proceeds of the short sale could be expected to
offset all or a portion of the effect of the stock's decline on the value
of the convertible security. Each fund currently intends to hedge no more
than 15% of its total assets with short sales on equity securities
underlying its convertible security holdings under normal circumstances.
When a fund enters into a short sale, it will be required to set aside
securities equivalent in kind and amount to those sold short (or securities
convertible or exchangeable into such securities) and will be required to
hold them aside while the short sale is outstanding. A fund will incur
transaction costs, including interest expense, in connection with opening,
maintaining, and closing short sales.
STRIPPED MORTGAGE-BACKED SECURITIES are created when a U.S. government
agency or a financial institution separates the interest and principal
components of a mortgage-backed security and sells them as individual
securities. The holder of the "principal-only" security (PO) receives the
principal payments made by the underlying mortgage-backed security, while
the holder of the "interest-only" security (IO) receives interest payments
from the same underlying security.
The prices of stripped mortgage-backed securities may be particularly
affected by changes in interest rates. As interest rates fall, prepayment
rates tend to increase, which tends to reduce prices of IOs and increase
prices of POs. Rising interest rates can have the opposite effect.
SWAP AGREEMENTS. 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. A fund is
not limited to any particular form of swap agreement if FMR determines it
is consistent with the fund's investment objective and policies.
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. Each fund expects to be able to eliminate
its exposure under swap agreements either by assignment or other
disposition, or by entering into an offsetting swap agreement with the same
party or a similarly creditworthy party.
Each fund will maintain appropriate liquid assets in a segregated custodial
account to cover its current obligations under swap agreements. If a fund
enters into a swap agreement on a net basis, it will segregate assets with
a daily value at least equal to the excess, if any, of the fund's accrued
obligations under the swap agreement over the accrued amount the fund is
entitled to receive under the agreement. If a fund enters into a swap
agreement on other than a net basis, it will segregate assets with a value
equal to the full amount of the fund's accrued obligations under the
agreement.
VARIABLE OR FLOATING RATE OBLIGATIONS bear variable or floating interest
rates and carry rights that permit holders to demand payment of the unpaid
principal balance plus accrued interest from the issuers or certain
financial intermediaries. Floating rate instruments have interest rates
that change whenever there is a change in a designated base rate while
variable rate instruments provide for a specified periodic adjustment in
the interest rate. These formulas are designed to result in a market value
for the instrument that approximates its par value.
ZERO COUPON BONDS. Zero coupon bonds do not make interest payments;
instead, they are sold at a deep 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 very volatile when interest rates
change. In calculating its dividends, a fund takes into account as income a
portion of the difference between a zero coupon bond's purchase price and
its face value.
A broker-dealer creates a DERIVATIVE ZERO by separating the interest and
principal components of a U.S. Treasury security and selling them as two
individual securities. CATS (Certificates of Accrual on Treasury
Securities), TIGRs (Treasury Investment Growth Receipts), and TRs (Treasury
Receipts) are examples of derivative zeros.
The Federal Reserve Bank creates STRIPS (Separate Trading of Registered
Interest and Principal of Securities) by separating the interest and
principal components of an outstanding U.S. Treasury bond and selling them
as individual securities. Bonds issued by the Resolution Funding
Corporation (REFCORP) and the Financing Corporation (FICO) can also be
separated in this fashion. ORIGINAL ISSUE ZEROS are zero coupon securities
originally issued by the U.S. government, a government agency, or a
corporation in zero coupon form.
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. If FMR grants investment management authority to the
sub-advisers (see the section entitled "Management Contracts"), the
sub-advisers are authorized to place orders for the purchase and sale of
portfolio securities, and will do so in accordance with the policies
described below. FMR is also responsible for the placement of transaction
orders for other investment companies and 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 arrangements for payment of fund
expenses. Generally, commissions for investments traded on foreign
exchanges will be higher than for investments traded on U.S. exchanges and
may not be subject to negotiation.
The funds may execute portfolio transactions with broker-dealers who
provide research and execution services to the funds or other 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 accounts; effect securities transactions, and perform
functions incidental thereto (such as clearance and settlement). The
selection of such broker-dealers generally is made by FMR (to the extent
possible consistent with execution considerations) in accordance with a
ranking of broker-dealers determined periodically by FMR's investment staff
based upon the quality of research and execution services provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the funds may be useful to FMR in rendering investment management
services to the funds 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 the funds. 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.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive 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
each 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 the funds and 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.
FMR is authorized to use research services provided by and to place
portfolio transactions with brokerage firms that have provided assistance
in the distribution of shares of the funds or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI) and Fidelity Brokerage Services (FBS), subsidiaries of FMR
Corp., if the commissions are fair, reasonable, and comparable to
commissions charged by non-affiliated, qualified brokerage firms for
similar services. From September 1992 through December 1994, FBS operated
under the name Fidelity Brokerage Services Limited, Inc. (FBSL). As of
January 1995, FBSL was converted to an unlimited liability company and
assumed the name FBS. Prior to September 4, 1992, FBSL operated under the
name Fidelity Portfolio Services, Ltd. (FPSL) as a wholly owned subsidiary
of Fidelity International Limited (FIL). Edward C. Johnson 3d is Chairman
of FIL. Mr. Johnson 3d, Johnson family members, and various trusts for the
benefit of the Johnson family own, directly or indirectly, more than 25% of
the voting common stock of FIL.
FMR may allocate brokerage transactions to broker-dealers who have entered
into arrangements with FMR under which the broker-dealer allocates a
portion of the commissions paid by each fund toward payment of the fund's
expenses, such as transfer agent fees or custodian fees. 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
accounts which they or their affiliates manage, unless certain requirements
are satisfied. Pursuant to such requirements, the Board of Trustees has
authorized FBSI to execute portfolio transactions on national securities
exchanges in accordance with approved procedures and applicable SEC rules.
Each fund's Trustees periodically review FMR's performance of its
responsibilities in connection with the placement of portfolio transactions
on behalf of the funds and review the commissions paid by each fund over
representative periods of time to determine if they are reasonable in
relation to the benefits to the fund.
The funds' portfolio turnover rates for the fiscal years ended September
30, 1996 and 1995 are illustrated in the table below. Because a high
turnover rate increases transaction costs and may increase taxable gains,
FMR carefully weighs the anticipated benefits of short-term investing
against these consequences. An increased turnover rate is due to a greater
volume of shareholder purchase orders, short-term interest rate volatility
and other special market conditions.
Portfolio Turnover Rates

September 30 1996 1995

Asset Manager: Income 148 % 157 %

Asset Manager 131 % 137 %

Asset Manager: Growth 138 % 119 %

The following tables show the brokerage commissions paid by each fund. The
first table shows the total amount of brokerage commissions paid by each
fund and the total amount of brokerage commissions paid to FBSI and FBS
(formerly FBSL) for the past three fiscal years. The second table shows the
percentage of aggregate brokerage commissions paid to and the percentage of
the aggregate dollar amount of transactions for which each fund paid
brokerage commissions effected through FBSI and FBS for the fiscal year
ended September 1996. The third table shows the amount of brokerage
commissions paid to firms providing research and the approximate dollar
amount of the transactions on which brokerage commissions were paid for the
fiscal year ended September 1996. Each fund pays both commissions and
spreads in connection with the placement of portfolio transactions. FBSI is
paid on a commission basis. The difference between the percentage of
brokerage commissions paid to and the percentage of the dollar amount of
transactions effected through FBSI is a result of the low commission rates
charged by FBSI.

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Fiscal Period Ended Total Amount Paid To FBSI To FBS

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Asset Manager: Income September 30

1996 $ 269,000 $ 39,000 $ 4,000

1995 $ 290,000 $ 59,000 $ 6,000

1994 $ 151,000 $ 48,000 $ 8,000

Asset Manager September 30

1996 $11,446,000 $ 1,319,000 $ 157,000

1995 $ 14,132,000 $ 1,978,000 $ 267,000

1994 $ 8,745,000 $ 2,266,000 $ 484,000

Asset Manager: Growth September 30

1996 $ 5,219,000 $ 518,000 $ 71,000

1995 $ 5,726,000 $ 687,000 $ 136,000

1994 $ 3,279,000 $ 602,000 $ 183,000

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Fiscal Period % of % of % of % of
Ended 1996 Commissions Transactions Commission Transactions
Paid to FBSI Effected through Paid to FBS Effected through
FBSI FBS

Asset Manager: Income
September 30 14.54% 25.61% 1.48% 0.93%

Asset Manager
September 30 11.46% 25.21% 1.3 7 % 1.16%

Asset Manager: Growth
September 30 9.91 % 2 5.83 % 1.37% 1.39%

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C>
Fiscal Period Amount Paid to Firms Total Amount of Transactions on
Ended 1996 Providing Research* which Commissions were Paid

Asset Manager: Income September 30 $ 247,000 $ 174,641,000

Asset Manager September 30 $ 10,800,000 $ 6,545,062,000

Asset Manager: Growth September 30 $ 4,951,000 $ 2,427,946,000

</TABLE>

* The provision of research services was not necessarily a factor in the
placement of all this business with such firms.
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, investment decisions for each fund
are made independently from those of other funds managed by FMR or 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 accounts.
Simultaneous transactions are inevitable when several funds and 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
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 OF PORTFOLIO SECURITIES
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 last bid price normally is used.
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. Fixed-income
securities and convertible securities may also 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
Trustees, on the basis of an evaluation of these services, 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.
Foreign securities are valued based on prices furnished by independent
brokers or quotation services which express the value of 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 extraordinary event that is expected to materially affect the
value of a portfolio security occurs after the close of an exchange on
which that security is traded, then that security will be valued as
determined 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 are not readily available are valued either at
amortized cost or at original cost plus accrued interest, both of which
approximate current value. In addition, 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. 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 market
value of such securities.
PERFORMANCE
The funds 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. Each fund's share price, yield, and
total return fluctuate in response to market conditions and other factors,
and the value of fund shares when redeemed may be more or less than their
original cost.
YIELD CALCULATIONS. Yields for a fund are computed by dividing the fund's
interest and dividend income for a given 30-day or one-month period, net of
expenses, by the average number of shares entitled to receive distributions
during the period, dividing this figure by the fund's net asset value (NAV)
at the end of the period, and annualizing the result (assuming compounding
of income) in order to arrive at an annual percentage rate. Income is
calculated for purposes of yield quotations in accordance with standardized
methods applicable to all stock and bond funds. Dividends from equity
investments are treated as if they were accrued on a daily basis, solely
for the purposes of yield calculations. In general, interest income is
reduced with respect to bonds trading at a premium over their par value by
subtracting a portion of the premium from income on a daily basis, and is
increased with respect to bonds trading at a discount by adding a portion
of the discount to daily income. For a fund's investments denominated in
foreign currencies, income and expenses are calculated first in their
respective currencies, and are then converted to U.S. dollars, either when
they are actually converted or at the end of the 30-day or one month
period, whichever is earlier. Capital gains and losses generally are
excluded from the calculation as are gains and losses from currency
exchange rate fluctuations.
Income calculated for the purposes of calculating a fund's yield differs
from income as determined for other accounting purposes. Because of the
different accounting methods used, and because of the compounding of income
assumed in yield calculations, a fund's yield may not equal its
distribution rate, the income paid to your account, or the income reported
in the fund's financial statements.
Yield information may be useful in reviewing a fund's performance and in
providing a basis for comparison with other investment alternatives.
However, each 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 a
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 a 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.
TOTAL RETURN CALCULATIONS. Total 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 the fund's NAV over a
stated period. Average annual total 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 total return of 100% over ten years would produce an average
annual total return of 7.18%, which is the steady annual rate of return
that would equal 100% growth on a compounded basis in ten years. While
average annual total 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
total returns represent averaged figures as opposed to the actual
year-to-year performance of the fund.
In addition to average annual total returns, a fund may quote unaveraged or
cumulative total returns reflecting the simple change in value of an
investment over a stated period. Average annual and cumulative total
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. Total 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 total return. Total returns may be quoted on a
before-tax or after-tax basis. Total 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 net asset values,
adjusted net asset values, and benchmark indices 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 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. On September 27, 1996, the 13-week and 39-week long-term moving
averages were $11.43 and $11.34, respectively, for Fidelity Asset Manager:
Income , $ 16.08 and $ 15.91 , respectively, for Fidelity
Asset Manager, and $16.05 and $15.87, respective ly, for Fidelity
Asset Manager: Growth.
HISTORICAL FUND RESULTS. The follow ing table shows each fu nd's total
returns for periods ended September 30, 1996.
Average Annual Total Returns Cumulative Total Returns

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
One Five Life of One Five Life of
Year Years Fund Year Years Fund

Asset Manager:
Income 7.28 % N/A 8.88%* 7.28 % N/A 40.55%*

Asset Manager 10.37 % 11.00 % 12.29%** 10.37 % 68.54% 145.97%**

Asset Manager: Growth 12.99 % N/A 13.65%*** 12.99 % N/A 83.86%***

</TABLE>

* From October 1, 1992 (commencement of operations).
** From December 28, 1988 (commencement of operations).
*** From December 30, 1991 (commencement of operations).
Note: If FMR had not reimbursed certain fund expenses during these periods,
Asset Manager: Income and Asset Manager: Growth life of fund total returns
would have been lower.
The following tables show the income and capital elements of each fund's
cumulative total return. The table compares each fund's return to the
record of the S&P 500, the Dow Jones Industrial Average (DJIA), and the
cost of living, as measured by the Consumer Price Index (CPI) over the same
period. The CPI information is as of the month end closest to the initial
investment date for each fund. The S&P 500 and the DJIA comparisons are
provided to show how each fund's total 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. Each fund
has the ability to invest in securities not included in either index, and
its investment portfolio may or may not be similar in composition to the
indexes. The S&P 500 and DJIA returns are based on the prices of unmanaged
groups of stocks and, unlike each fund's returns, do not include the effect
of brokerage commissions and other costs of investing.
During the period from October 1, 1992 (commencement of operations) to
September 30, 1996, a hypothetical $10,000 investment in Fid elity Asset
Manager: Income would have grown to $ 14,055 assuming all
distributions were reinvested. This was a period of fluctuating interest
rates, bond prices, and stock prices and the figures that follow should not
be considered representative of the dividend income or capital gain or loss
that could be realized from an investment in the fund today.
FIDELITY ASSET MANAGER: INCOME INDICES

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period
Ended Value of Value of Value of Total S&P 500 DJIA CPI**
September
30 Initial Reinvested Reinvested Value
$10,000 Income Capital Gain
Investment Distributions Distributions

1996 $ 11,630 $ 2,337 $ 88 $ 14,055 $ 18,294 $ 19,941 $ 11,168

1995 $ 11,460 $ 1,554 $ 88 $ 13,102 $ 15,203 $ 15,886 $ 10,842

1994 $ 10,690 $ 928 $ 82 $ 11,700 $ 11,717 $ 12,429 $ 10,573

1993* $ 11,070 $ 462 $ 0 $ 11,532 $ 11,301 $ 11,190 $ 10,269

</TABLE>

* From October 1, 1992 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 made on October
1, 1992, the net amount invested in fund shares was $10,000. 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 $12,286.
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 $2,000 for dividends and $80 for
capital gains distributions. Tax consequences of different investments have
not been factored into the above figures.
During the period from December 28, 1988 (commencement of operations) to
September 30, 1996, a hypothetical $10,000 investment in Fidelity Asset
Manager would have grown to $24,597 assuming all distributions were
reinvested. This was a period of fluctuating interest rates, bond prices,
and stock prices and the figures that follow should not be considered
representative of the dividend income or capital gain or loss that could be
realized from an investment in the fund today.
FIDELITY ASSET MANAGER INDICES

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA CPI**
September 30 Initial Reinvested Reinvested Value
$10,000 Income Capital Gain
Investment Distributions Distributions

1996 $ 16,490 $ 5,801 $ 2,306 $ 24,597 $ 31,319 $ 34,398 $ 13,095

1995 $ 15,470 $ 4,653 $ 2,163 $ 22,286 $ 26,027 $ 27,404 $ 12,714

1994 $ 14,580 $ 3,870 $ 1,793 $ 20,243 $ 20,059 $ 21,441 $ 12,398

1993 $ 14,970 $ 3,286 $ 1,284 $ 19,540 $ 19,347 $ 19,303 $ 12,041

1992 $ 13,500 $ 1,898 $ 924 $ 16,322 $ 17,119 $ 17,250 $ 11,726

1991 $ 13,020 $ 1,287 $ 287 $ 14,594 $ 15,415 $ 15,446 $ 11,386

1990 $ 10,640 $ 371 $ 234 $ 11,245 $ 11,751 $ 12,122 $ 11,012

1989* $ 11,390 $ 0 $ 0 $ 11,390 $ 12,948 $ 12,808 $ 10,373

</TABLE>

* From December 28, 1988 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 made on
December 28, 1988, the net amount invested in fund shares was $10,000. 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
$16,491. 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 $3,780 for dividends
and $1,530 for capital gains distributions. Tax consequences of different
investments have not been factored into the above figures.
During the period from December 30, 1991 (commencement of operations) to
September 30, 1996, a hypothetical $10,000 investment in Fidelity Asset
Manager: Growth would have grown to $18,386 assuming all distributions were
reinvested. This was a period of fluctuating interest rates, bond prices,
and stock prices and the figures that follow should not be considered
representative of the dividend income or capital gain or loss that could be
realized from an investment in the fund today.
FIDELITY ASSET MANAGER: GROWTH INDICES

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA CPI**
September 30 Initial Reinvested Reinvested Value
$10,000 Income Capital Gain
Investment Distributions Distributions

1996 $ 16,560 $ 859 $ 967 $ 18,386 $ 19,240 $ 21,504 $ 11,443

1995 $ 14,880 $ 524 $ 869 $ 16,273 $ 15,989 $ 17,132 $ 11,109

1994 $ 13,910 $ 272 $ 618 $ 14,800 $ 12,323 $ 13,404 $ 10,834

1993 $ 13,770 $ 178 $ 95 $ 14,043 $ 11,885 $ 12,067 $ 10,522

1992* $ 11,160 $ 0 $ 0 $ 11,160 $ 10,517 $ 10,784 $ 10,247

</TABLE>

* From December 30, 1991 (commencement of operations).
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 made on
December 30, 1991, the net amount invested in fund shares was $10,000. 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
$11,476. 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 $660 for dividends and
$760 for capital gains distributions. Tax consequences of different
investments have not been factored into the above figures.
PERFORMANCE COMPARISONS. The Asset Allocation Composite Indices are
hypothetical representations of the performance of the funds' three asset
classes according to their respective weighting in each fund's neutral mix.
The weightings are rebalanced monthly. Beginning January 1, 1997, the
Conservative Asset Allocation Composite Index represents Asset Manager:
Income's three asset classes according to their respective weighting in the
fund's neutral mix (30% - short-term/money market; 50% - bonds; and 20%
stocks), the Asset Allocation Composite Index represents Asset Manager's
three asset classes according to their respective weighting in the fund's
neutral mix (10% - short-term/money market; 40% - bonds; and 50% stocks),
and the Aggressive Asset Allocation Composite Index represents Asset
Manager: Growth's three asset classes according to their respective
weighting in the fund's neutral mix (5% - short-term/money market; 25% -
bonds; and 70% stocks). The following indices are used to calculate the
three asset allocation composite indices: the Salomon Brothers 3-month
T-Bill Total Rate of Return Index, representing the average of T-Bill rates
for each of the prior three months, adjusted to a bond equivalent yield
basis (short-term and money market instruments); the Lehman Brothers
Aggregate Bond Index, a market value weighted performance benchmark for
investment-grade fixed-rate debt issues, including government, corporate,
asset-backed, and mortgaged-backed securities with maturities of at least
one year; and the S&P 500, a widely recognized, unmanaged index of common
stocks. Prior to January 1, 1997, the Conservative Asset Allocation
Composite Index represented Asset Manager: Income's three asset classes
according to their respective weighting in the fund's neutral mix (50% -
short-term instruments; 30% - bonds; and 20% stocks) during that period of
time; between June 1, 1992 and January 1, 1997, the Asset Allocation
Composite Index represented Asset Manager's three asset classes according
to their respective weighting in the fund's neutral mix (20% - short-term
instruments; 40% - bonds; and 40% stocks) during that period of time; and
prior to January 1, 1997, the Aggressive Asset Allocation Composite Index
represented Asset Manager: Growth's three asset classes according to their
respective weighting in the fund's neutral mix (5% - short-term
instruments; 30% - bonds; and 65% stocks) during that period of time. The
following indices were used to calculate the three asset allocation
composite indices: the Salomon Brothers 3-month T-Bill Total Rate of Return
Index; the Lehman Brothers Treasury Bond Index, a widely utilized benchmark
of bond market performance that includes virtually all long-term public
obligations of the U.S. Treasury (bonds): and the S&P 500. Prior to June 1,
1992, the Asset Allocation Composite Index represented Asset Manager's
three asset classes according to their respective weighting in the fund's
neutral mix (30% - money market instruments; 40% - bonds; and 30% stocks)
during that period of time. The following indices were used to calculate
the three asset allocation composite indices: the Salomon Brothers 3-month
T-Bill Total Rate of Return Index; the Lehman Brothers Treasury Bond Index;
and the S&P 500.
Each fund has the ability to invest in securities that are not included in
any of the indices, and each fund's actual investment portfolio may not
reflect the composition or the weighting of the indices used. The S&P 500
and the asset allocation composite indices include reinvestment of income
or dividends and are based on the prices of unmanaged groups of stocks or
U.S. Treasury obligations. Unlike each fund's returns, the indices do not
include the effect of paying brokerage commissions, spreads, or other costs
of investing. Historical results are used for illustrative purposes only
and do not reflect the past or future performance of the funds.
The following table represents the comparative indices calendar
year-to-year performance:

<TABLE>
<CAPTION>
<S> <C> <C> <C>
SALOMON BROTHERS 3-MONTH LEHMAN BROTHERS TREASURY
T-BILL TOTAL RATE OF BOND INDEX S&P 500
RETURN INDEX

1995 5.75% 18.35% 37.58%

1994 4.24 -3.38 1.32

1993 3.09 10.68 10.08

1992 3.61 7.21 7.62

1991 5.75 15.29 30.47

1990 7.90 8.54 -3.10

1989 8.64 14.38 31.69

1988 6.76 6.99 16.61

1987 5.91 2.00 5.10

1986 6.23 15.61 18.56

</TABLE>

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 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 indices.
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 total returns in the same method as the funds.
The funds may also compare performance to that of other compilations or
indices that may be developed and made available in the future.
A fund may compare its performance or the performance of securities in
which it may invest to averages published by IBC USA (Publications), Inc.
of Ashland, Massachusetts. These averages assume reinvestment of
distributions. The IBC/Donoghue's MONEY FUND AVERAGES(trademark)/All
Taxable, which is reported in the MONEY FUND REPORT(registered trademark),
covers over 757 taxable money market funds. The Bond Fund Report
AverageS(trademark)/All Taxable, which is reported in the BOND FUND
REPORT(registered trademark), covers over 554 taxable bond funds. When
evaluating comparisons to money market funds, investors should consider the
relevant differences in investment objectives and policies. Specifically,
money market funds invest in short-term, high-quality instruments and seek
to maintain a stable $1.00 share price. The fund, however, invests in
longer-term instruments and its share price changes daily in response to a
variety of factors.
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; charitable giving; and the Fidelity credit
card. 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,
a quarterly magazine provided free of charge to Fidelity fund shareholders.
A fund may present its fund number, Quotron(trademark) number, and CUSIP
number, and discuss or quote its current portfolio manager.
VOLATILITY. A fund may quote various measures of volatility and benchmark
correlation in advertising. In addition, a fund may compare these measures
to those of other funds. Measures of volatility seek to compare a fund's
historical share price fluctuations or total 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. In advertising, a fund
may also discuss or illustrate examples of interest rate sensitivity.
MOMENTUM INDICATORS indicate a fund's price movements over specific periods
of time. Each point on the momentum indicator represents the fund's
percentage change in price movements over that period.
A fund may advertise examples of the effects of periodic investment plans,
including the principle of dollar cost averaging. In such a program, an
investor invests a fixed dollar amount in a fund at periodic intervals,
thereby purchasing fewer shares when prices are high and more shares when
prices are low. While such a strategy does not assure a profit or guard
against loss in a declining market, the investor's average cost per share
can be lower than if fixed numbers of shares are purchased at the same
intervals. In evaluating such a plan, investors should consider their
ability to continue purchasing shares during periods of low price levels.
A fund may be available for purchase through retirement plans or other
programs offering deferral of, or exemption from, income taxes, which may
produce superior after-tax returns over time. For example, a $1,000
investment earning a taxable return of 10% annually would have an after-tax
value of $1,949 after ten years, assuming tax was deducted from the return
each year at a 31% rate. An equivalent tax-deferred investment would have
an after-tax value of $2,100 after ten years, assuming tax was deducted at
a 31% rate from the tax-deferred earnings at the end of the ten-year
period.
As of September 30, 1996, FMR advised over $27 billion in tax-free fund
assets, over $89 billion in money market fund assets, over $284 billion in
equity fund assets, over $57 b illion in international fund assets,
and over $ 24 billion in Spartan (registered trademark) 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.
The fund may be advertised as an investment choice under the Fidelity
College Savings Plan or the Fidelity Investor Card mutual fund option.
Advertising may contain illustrations of projected future college costs
based on assumed rates of inflation and examples of hypothetical
performance. Advertising for the Fidelity College Savings Plan mutual fund
option may be used in conjunction with advertising for the Fidelity College
Savings Plan brokerage option, a product offered through Fidelity Brokerage
Services, Inc. The Fidelity Investor Card is a product offered through
Fidelity Trust Company.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
Each fund is open for business and its net asset value per share (NAV) is
calculated each day the New York Stock Exchange (NYSE) is open for trading.
The NYSE has designated the following holiday closings for 1996: New Year's
Day, Presidents' Day (observed), Good Friday, Memorial Day (observed),
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. Although
FMR expects the same holiday schedule to be observed in the future, the
NYSE may modify its holiday schedule at any time. In addition, the funds
will not process wire purchases and redemptions on days when the Federal
Reserve Wire System is closed.
FSC normally determines each fund's NAV as of the close of the NYSE
(normally 4:00 p.m. Eastern time). However, NAV may be calculated earlier
if trading on the NYSE is restricted or as permitted by the Securities and
Exchange Commission (SEC). To the extent that portfolio securities are
traded in other markets on days when the NYSE is closed, a fund's NAV may
be affected on days when investors do not have access to the fund to
purchase or redeem shares. In addition, trading in some of a fund's
portfolio securities may not occur on days when the fund is open for
business.
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 a 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.
Pursuant to Rule 11a-3 under the Investment Company Act of 1940 (the 1940
Act), each fund is required to give shareholders at least 60 days' notice
prior to terminating or modifying its exchange privilege. Under the Rule,
the 60-day notification requirement may be waived if (i) the only effect of
a modification would be to reduce or eliminate an administrative fee,
redemption fee, or deferred sales charge ordinarily payable at the time of
an exchange, or (ii) a fund suspends the redemption of the shares to be
exchanged as permitted under the 1940 Act or the rules and regulations
thereunder, or the fund to be acquired suspends the sale of its shares
because it is unable to invest amounts effectively in accordance with its
investment objective and policies.
In the Prospectus, each fund has notified shareholders that it reserves the
right at any time, without prior notice, to refuse exchange purchases by
any person or group if, in FMR's judgment, the fund would be unable to
invest effectively in accordance with its investment objective and
policies, or would otherwise potentially be adversely affected.
DISTRIBUTIONS AND TAXES
DISTRIBUTIONS. If you request to have distributions mailed to you and the
U.S. Postal Service cannot deliver your checks, or if your checks remain
uncashed for six months, Fidelity may reinvest your distributions at the
then-current NAV. All subsequent distributions will then be reinvested
until you provide Fidelity with alternate instructions.
DIVIDENDS. A portion of each fund's income may qualify for the
dividends-received deduction available to corporate shareholders to the
extent that each fund's income is derived from qualifying dividends.
Because each fund may earn other types of income, such as interest, income
from securities loans, non-qualifying dividends, and short-term capital
gains, the percentage of dividends from the fund that qualifies for the
deduction generally will be less than 100%. Each fund will notify corporate
shareholders annually of the percentage of fund dividends that qualifies
for the dividends-received deduction. A portion of each fund's dividends
derived from certain U.S. Government securities may be exempt from state
and local taxation. Gains (losses) attributable to foreign currency
fluctuations are generally taxable as ordinary income, and therefore will
increase (decrease) dividend distributions. If a fund's distributions
exceed its net investment company taxable income during a taxable year, all
or a portion of the distributions made in the same taxable year would be
recharacterized as a return of capital to shareholders, thereby reducing
each shareholder's cost basis in the fund. Short-term capital gains are
distributed as dividend income. Each fund will send each shareholder a
notice in January describing the tax status of dividends and capital gain
distributions for the prior year.
CAPITAL GAIN DISTRIBUTIONS. Long-term capital gains earned by each fund on
the sale of securities and distributed to shareholders are federally
taxable as long-term capital gains, regardless of the length of time
shareholders have held their shares. If a shareholder receives a long-term
capital gain distribution on shares of a fund, and such shares are held six
months or less and are sold at a loss, the portion of the loss equal to the
amount of the long-term capital gain distribution will be considered a
long-term loss for tax purposes. Short-term capital gains distributed by
each fund are taxable to shareholders as dividends, not as capital gains.
As of September 30, 1996, Asset Manager: Income, Asset Manager and Asset
Manager: Growth hereby designate approximately $5,543,000,
$ 91,888,000 and $33,097,000 as a capital gain dividend for the
purpose of the dividend-paid deduction.
FOREIGN TAXES. Foreign governments may withhold taxes on dividends and
interest paid with respect to foreign securities. Foreign governments may
also impose taxes on other payments or gains with respect to foreign
securities. Because a fund does not currently anticipate that securities of
foreign issuers will constitute more than 50% of its total assets at the
end of its fiscal year, shareholders should not expect to claim a foreign
tax credit or deduction on their federal income tax returns with respect to
foreign taxes withheld.
TAX STATUS OF THE FUNDS. Each fund intends to qualify each year as a
"regulated investment company" for tax purposes 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. Each fund intends to comply with other tax rules
applicable to regulated investment companies, including a requirement that
capital gains from the sale of securities held less than three months
constitute less than 30% of the fund's gross income for each fiscal year.
Gains from some forward currency contracts, futures contracts, and options
are included in this 30% calculation, which may limit a fund's investments
in such instruments.
If a fund purchases shares in certain foreign investment entities, defined
as passive foreign investment companies (PFICs) in the Internal Revenue
Code, it may be subject to U.S. federal income tax on a portion of any
excess distribution or gain from the disposition of such shares. Interest
charges may also be imposed on a fund with respect to deferred taxes
arising from such distributions or gains. Generally, each fund will elect
to mark-to-market any PFIC shares. Unrealized gains will be recognized as
income for tax purposes and must be distributed to shareholders as
dividends.
Each fund is treated as a separate entity from the other funds of Fidelity
Charles Street Trust for tax purposes.
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. 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.
FMR
All of the stock of FMR is owned by FMR Corp., its parent organized in
1972. The voting common stock of FMR Corp. is divided into two classes.
Class B is held predominantly by members of the Edward C. Johnson 3d family
and is entitled to 49% of the vote on any matter acted upon by the voting
common stock. Class A is held predominantly by non-Johnson family member
employees of FMR Corp. and its affiliates and is entitled to 51% of the
vote on any such matter. The Johnson family group and all other Class B
shareholders have entered into a shareholders' voting agreement under which
all Class B shares will be voted in accordance with the majority vote of
Class B shares. Under the 1940 Act, control of a company is presumed where
one individual or group of individuals owns more than 25% of the voting
stock of that company. Therefore, through their ownership of voting common
stock and the execution of the shareholders' voting agreement, members of
the Johnson family may be deemed, under the 1940 Act, to form a controlling
group with respect to FMR Corp.
At present, the principal operating activities of FMR Corp. are those
conducted by its division Fidelity Investments Retail Marketing Company,
which provides marketing services to various companies within the Fidelity
organization.
Fidelity investment personnel may invest in securities for their own
account 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.
TRUSTEES AND OFFICERS
The Trustees, Members of the Advisory Board, and executive officers of the
trust are listed below. 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. The business address
of each Trustee and officer who is an "interested person" (as defined in
the Investment Company Act of 1940) is 82 Devonshire Street, Boston,
Massachusetts 02109, which is also the address of FMR. The business address
of all the other Trustees and Members of the Advisory Board 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 (66), 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
FMR Texas Inc., Fidelity Management & Research (U.K.) Inc., and Fidelity
Management & Research (Far East) Inc.
*J. GARY BURKHEAD (55), Trustee and Senior Vice President, is President of
FMR; and President and a Director of FMR Texas Inc., Fidelity Management &
Research (U.K.) Inc., and Fidelity Management & Research (Far East) Inc.
RALPH F. COX (64), Trustee (1991), is a management consultant (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 Sanifill Corporation
(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 (64), Trustee (1992). 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.
RICHARD J. FLYNN (72), Trustee and Chairman of the non-interested Trustees,
is a financial consultant. Prior to September 1986, Mr. Flynn was Vice
Chairman and a Director of the Norton Company (manufacturer of industrial
devices). He is currently a Trustee of College of the Holy Cross and Old
Sturbridge Village, Inc., and he previously served as a Director of
Mechanics Bank (1971-1995).
E. BRADLEY JONES (68), 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),
Cleveland-Cliffs Inc (mining), 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
marketing, 1985-1995) and Hyster-Yale Materials Handling, Inc. (1985-1995).
In addition, he serves as a Trustee of First Union Real Estate Investments,
a Trustee and member of the Executive Committee of the Cleveland Clinic
Foundation, a Trustee and member of the Executive Committee of University
School (Cleveland), and a Trustee of Cleveland Clinic Florida.
DONALD J. KIRK (63), 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 is a Director of General Re
Corporation (reinsurance), and he previously served as a Director of
Valuation Research Corp. (appraisals and valuations, 1993-1995). In
addition, he serves as Chairman of the Board of Directors of the National
Arts Stabilization Fund, Vice Chairman of the Board of Trustees of the
Greenwich Hospital Association, 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 (53), Trustee, is Vice Chairman and Director of FMR (1992).
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). He is a Director of W.R. Grace
& Co. (chemicals) and Morrison Knudsen Corporation (engineering and
construction). 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.
GERALD C. McDONOUGH (67), Trustee and Vice-Chairman of the non-interested
Trustees, is Chairman of G.M. Management Group (strategic advisory
services). Prior to his retirement in July 1988, he was Chairman and Chief
Executive Officer of Leaseway Transportation Corp. (physical distribution
services). Mr. McDonough is a Director of Brush-Wellman Inc. (metal
refining), 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.
EDWARD H. MALONE (71), Trustee. Prior to his retirement in 1985, Mr. Malone
was Chairman, General Electric Investment Corporation and a Vice President
of General Electric Company. He is a Director of Allegheny Power Systems,
Inc. (electric utility), General Re Corporation (reinsurance) and Mattel
Inc. (toy manufacturer). In addition, he serves as a Trustee of the Naples
Philharmonic Center for the Arts and Rensselaer Polytechnic Institute, and
he is a member of the Advisory Boards of Butler Capital Corporation Funds
and Warburg, Pincus Partnership Funds.
MARVIN L. MANN (63), Trustee (1993) is Chairman of the Board, President,
and Chief Executive Officer 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) and Infomart (marketing
services, 1991), a Trammell Crow Co. In addition, he serves as the Campaign
Vice Chairman of the Tri-State United Way (1993) and is a member of the
University of Alabama President's Cabinet.
THOMAS R. WILLIAMS (68), 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 BellSouth Corporation
(telecommunications), ConAgra, Inc. (agricultural products), Fisher
Business Systems, Inc. (computer software), Georgia Power Company (electric
utility), Gerber Alley & Associates, Inc. (computer software), National
Life Insurance Company of Vermont, American Software, Inc., and AppleSouth,
Inc. (restaurants, 1992).
WILLIAM O. McCOY (62), Member of the Advisory Board (1996), 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) and
President of BellSouth Enterprises. He is currently a Director of Liberty
Corporation (holding company), Weeks Corporation of Atlanta (real estate,
1994), and Carolina Power and Light Company (electric utility, 1996).
Previously, he was 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).
WILLIAM J. HAYES (62), Vice President (1994), is Vice President of
Fidelity's equity funds; Senior Vice President of FMR; and Managing
Director of FMR Corp.
RICHARD C. HABERMANN (56), is lead-manager and Vice President of Fidelity
Asset Manager: Income, Fidelity Asset Manager and Fidelity Asset Manager:
Growth which he has managed since March 1996. He also manages several other
Fidelity funds. Previously, Mr. Habermann was chief investment officer for
Fidelity International, Ltd., from 1991 to 1993, and division head for
international equities and director of international research, from 1993 to
1996. Mr. Habermann joined Fidelity in 1968.
GEORGE A. VANDERHEIDEN (50), is Vice President of Fidelity Asset Manager:
Income, Fidelity Asset Manager and Fidelity Asset Manager: Growth and
manager of their equity investments, which he has managed since March 1996.
He also manages several other Fidelity funds. Mr. Vanderheiden joined
Fidelity in 1971.
JOHN J. TODD (47), is Vice President of Fidelity Asset Manager: Income,
Fidelity Asset Manager and Fidelity Asset Manager: Growth and manager of
their short-term and money market investments, which he has managed since
December 1996. He also manages several other Fidelity funds. Mr. Todd
joined Fidelity in 1981.
ARTHUR S. LORING (48), Secretary, is Senior Vice President (1993) and
General Counsel of FMR, Vice President-Legal of FMR Corp., and Vice
President and Clerk of FDC.
KENNETH A. RATHGEBER (49), Treasurer (1995), is Treasurer of the Fidelity
funds and is an employee of FMR (1995). Before joining FMR, Mr. Rathgeber
was a Vice President of Goldman Sachs & Co. (1978-1995), where he served in
various positions, including Vice President of Proprietary Accounting
(1988-1992), Global Co-Controller (1992-1994), and Chief Operations Officer
of Goldman Sachs (Asia) LLC (1994-1995).
ROBERT H. MORRISON (56), Manager of Security Transactions of Fidelity's
equity funds is Vice President of FMR.
JOHN H. COSTELLO (50), Assistant Treasurer, is an employee of FMR.
LEONARD M. RUSH (50), 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).
COMPENSATION TABLE
Aggregate Compensation

J. Gary Ralph Phyllis Richard Edward E. Donald Peter Gerald Edward H. Marvin Thomas William
Burkhead** F. Burke J. C. Bradley J. S. C. Malone*** L. R. O.
Cox*** Davis Flynn Johnson Jones Kirk Lynch** McDonough Mann*** Williams McCoy
3d**

Asset
$ 0 $ 1,088 $ 1,000 $ 1,300 $ 0 $ 1,012 $ 1,012 $ 0 $ 1,000 $ 1,061 $ 1,061 $ 1,011 $ 401
Manager:
Growth

Asset
0 4,063 3,755 4,883 0 3,800 3,800 0 3,748 3,963 3,963 3,794 1,434
Manager

Asset
0 204 198 257 0 200 200 0 198 200 200 200 76
Manager:
Income

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C>
Trustees Pension or Estimated Annual Total
Retirement Benefits Upon Compensation
Benefits Accrued Retirement from from the Fund
as Part of Fund the Fund Complex* Complex*
Expenses from the
Fund Complex*

J. Gary Burkhead** $ 0 $ 0 $ 0

Ralph F. Cox 5,200 52,000 128,000

Phyllis Burke Davis 5,200 52,000 125,000

Richard J. Flynn 0 52,000 160,500

Edward C. Johnson 3d** 0 0 0

E. Bradley Jones 5,200 49,400 128,000

Donald J. Kirk 5,200 52,000 129,500

Peter S. Lynch** 0 0 0

Gerald C. McDonough 5,200 52,000 128,000

Edward H. Malone 5,200 44,200 128,000

Marvin L. Mann 5,200 52,000 128,000

Thomas R. Williams 5,200 52,000 125,000

William O. McCoy N/A N/A 0

</TABLE>

* In formation is as of December 31, 1995 for 219 fund s in the
complex.
** Interested trustees of the fund are compensated by FMR.
*** For the fiscal year ended September 30, 1996, certain of the
non-interested trustees' aggregate compensation from a fund includes
accrued deferred compensation as follows: Ralph Cox, $911, Asset Manager:
Growth; $3,370, Asset Manager; Edward Malone, $884, Asset Manager: Growth,
$3,270, Asset Manager, Marvin Mann, $884, Asset Manager: Growth, $3270,
Asset Manager.
The non-interested Trustees may elect to defer receipt of all or a
percentage of their annual fees in accordance with the terms of a Deferred
Compensation Plan (the Plan). Under the Plan, compensation deferred by a
Trustee is periodically adjusted as though an equivalent amount had been
invested and reinvested in shares of one or more funds in the complex
designated by such Trustee (designated securities). The amount paid to the
Trustee under the Plan will be determined based upon the performance of
such investments. Deferral of Trustees' 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 the fund to retain the services of
any Trustee or to pay any particular level of compensation to the Trustee.
Each fund may invest in such designated securities under the Plan without
shareholder approval.
Under a retirement program adopted in July 1988 and modified in November
1995, each non-interested Trustee may receive payments from a Fidelity fund
during his or her lifetime based on his or her basic trustee fees and
length of service. The obligation of a fund to make such payments is
neither secured nor funded. A Trustee become eligible to participate in the
program at the end of the calendar year in which he or she reaches age 72,
provided that, at the time of retirement, he or she has served as a
Fidelity fund Trustee for at least five years. Currently, Messrs. Ralph S.
Saul, William R. Spaulding, Bertram H. Witham, and David L. Yunich, all
former non-interested Trustees, receive retirement benefits under the
program.
As of December 31, 1996, approximately 6.05% of Asset Manager: Growth's
and 6.11% of Asset Manager: Income's total outstanding shares were held by
an FMR Affiliate. FMR Corp. is the ultimate parent company of this FMR
affiliate. By virtue of his ownership interest in FMR Corp., as described
in the "FMR" section on page 22, Mr. Edward C. Johnson 3d, President and
Trustee of the funds, 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 Asset Manager: Growth's and Asset Manager: Income's shares,
Trustees and officers of each fund owned, in the aggregate, less than 1% of
each fund's total outstanding shares.
The following owned of record or beneficially 5% or more of the outstanding
shares of Asset Manager: Growth and Asset Manager: Income: National
Financial Services Corporation, One World Financial Center, New York,
NY.
MANAGEMENT CONTRACTS
Each fund employs FMR to furnish investment advisory and other services.
Under 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 each fund in accordance with its investment objective,
policies, and limitations. FMR also provides each fund with all necessary
office facilities and personnel for servicing each 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 and
state laws; developing management and shareholder services for each fund;
and furnishing reports, evaluations, and analyses on a variety of subjects
to the Trustees.
In addition to the management fee payable to FMR and the fees payable to
FSC, each fund pays all of its expenses, without limitation, 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. Although each
fund's current management contract provides that each fund will pay for
typesetting, printing, and mailing prospectuses, statements of additional
information, notices, and reports to shareholders, the trust, on behalf of
each fund has entered into a revised transfer agent agreement with FSC,
pursuant to which FSC bears the costs of providing these services to
existing shareholders. Other expenses paid by each fund include interest,
taxes, brokerage commissions, and each fund's proportionate share of
insurance premiums and Investment Company Institute dues. Each fund is also
liable for such non-recurring expenses as may arise, including costs of any
litigation to which each fund may be a party, and any obligation it may
have to indemnify its officers and Trustees with respect to litigation.
FMR is each fund's manager pursuant to management contracts dated October
1, 1994, which were approved by shareholders on September 21, 1994.
For the services of FMR under the contract, each fund pays FMR a monthly
management fee composed of the sum of two elements: a group fee rate and an
individual fund fee rate.
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 group fee rate for Asset Manager and Asset Manager: Growth is
calculated on a cumulative basis pursuant to the graduated fee rate
schedule shown below on the left. The schedule below 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 $ 420 billion of group net
assets - the approximate level for September 1996 - was .3050 %,
which is the weighted average of the respective fee rates for each level of
group net assets up to $ 420 billion.
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES

Average Group Annualized Group Net Effective Annual
Assets Rate Assets 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 .3253

36 - 42 .3400 250 .3223

42 - 48 .3350 275 .3198

48 - 66 .3250 300 .3175

66 - 84 .3200 325 .3153

84 - 102 .3150 350 .3133

102 - 138 .3100

138 - 174 .3050

174 - 228 .3000

228 - 282 .2950

282 - 336 .2900

Over 336 .2850

Prior to October 1, 1994, the group fee rate was based on a schedule with
breakpoints ending at .3100% for average group assets in excess of $102
billion. The group fee rate breakpoints shown above for average group
assets in excess of $138 billion and under $228 billion were voluntarily
adopted by FMR on January 1, 1992. The additional breakpoints shown above
for average group assets in excess of $228 billion were voluntarily
adopted by FMR on November 1, 1993. Each fund's current management contract
reflects these extensions of the group fee rate schedule.
On August 1, 1994, FMR voluntarily revised the prior extensions to the
group fee rate schedule, and added new breakpoints for average group assets
in excess of $210 billion and under $390 billion as shown in the schedule
below. The revised group fee rate schedule was identical to the above
schedule for average group assets under $210 billion.
On January 1, 1996, FMR voluntarily added new breakpoints to the revised
schedule for average group assets in excess of $390 billion, pending
shareholder approval of a new management contract reflecting the required
schedule and additional breakpoints. The revised group fee rate schedule
and its extensions provide for lower management fee rates as FMR's assets
under management increase. For average group assets in excess of $210
billion, the revised group fee rate schedule with additional breakpoints
voluntarily adopted by FMR is as follows:
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES

Average Group Annualized Group Net Effective Annual
Assets Rate Assets Fee Rate

174 - $210 billion .3000% $ 150 billion .3371%

210 - 246 .2950 175 .3325

246 - 282 .2900 200 .3284

282 - 318 .2850 225 .3249

318 - 354 .2800 250 .3219

354 - 390 .2750 275 .3190

390 - 426 .2700 300 .3163

426 - 462 .2650 325 .3137

462 - 498 .2600 350 .3113

498 - 534 .2550 375 .3090

Over 534 .2500 400 .3067

425 .3046

450 .3024

475 .3003

500 .2982

525 .2962

550 .2942

The group fee rate for Asset Manager: Income is calculated on a cumulative
basis pursuant to the graduated schedule shown on the left of the chart
below. On the right, the effective annual fee rate schedule shows the
result of cumulatively applying the annualized rates at varying asset
levels. For example, the effective annual fee rate at $ 420 billion
of group net assets - the approximate level for September 1996 - was
.1446 %, which is the weighted average of the respective fee rates
for each level of group net assets up to $ 420 billion.
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES

Average Group Annualized Group Net Effective Annual
Assets Rate Assets 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 .1695

24 - 30 .1800 200 .1658

30 - 36 .1750 225 .1629

36 - 42 .1700 250 .1604

42 - 48 .1650 275 .1583

48 - 66 .1600 300 .1565

66 - 84 .1550 325 .1548

84 - 120 .1500 350 .1533

120 - 174 .1450 400 .1507

174 - 228 .1400

228 - 282 .1375

282 - 336 .1350

Over 336 .1325

Prior to October 1, 1994, the group fee rate was based on a schedule with
breakpoints ending at .1400% for average group assets in excess of $174
billion. The additional breakpoints shown above for average group assets in
excess of $228 billion were voluntarily adopted by FMR on November 1, 1993.
The fund's current management contract reflects this extension of the group
fee rate schedule.
On August 1, 1994, FMR voluntarily revised the prior extension to the group
fee rate schedule, and added new breakpoints for average group assets in
excess of $156 billion and under $372 billion as shown in the schedule
below. The revised group rate fee schedule was identical to the above
schedule for average group assets under $156 billion.
On January 1, 1996, FMR voluntarily revised the prior extension to the
group fee rate schedule, and added new breakpoints for average group assets
in excess of $210 billion and under $390 billion as shown in the schedule
below. The revised group rate fee schedule was identical to the above
schedule for average group assets under $156 billion.
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES

Average Group Annualized Group Net Effective Annual
Assets Rate Assets Fee Rate

120 - $156 billion .1450% $ 150 billion .1736%

156 - 192 .1400 175 .1690

192 - 228 .1350 200 .1652

228 - 264 .1300 225 .1618

264 - 300 .1275 250 .1587

300 - 336 .1250 275 .1560

336 - 372 .1225 300 .1536

372 - 408 .1200 325 .1514

408 - 444 .1175 350 .1494

444 - 480 .1150 375 .1476

480 - 516 .1125 400 .1459

Over 516 .1100 425 .1443

450 .1427

475 .1413

500 .1399

525 .1385

550 .1372

The individual fund fee rates for Asset Manager: Income, Asset Manager,
and Asset Manager: Growth are .30%, .25%, and .30%, respectively. Based on
the average group net assets of the funds advised by FMR for September
1996, the annual management fee rates would be calculated as follows:

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Individual Fund Management
Group Fee Rate Fee Rate Fee Rate *

Asset Manager: Income .1446 % + .30% = .4446 %

Asset Manager .3050 % + .25% = .5550 %

Asset Manager: Growth .3050 % + .30% = .6050 %

</TABLE>

* Effective August 1, 1996, FMR voluntarily reduced the individual fund
fee rates for Asset Manager: Income, Asset Manager and Asset Manager:
Growth from .35%, .40% and .40% to .30%, .25%, and .30%, respectively. If
this reduction were not in effect, the total management fee rates would
have been .50%, .71%, and .71%, respectively.
One-twelfth of this annual rate is applied to each fund's net assets
averaged for the most recent month, giving a dollar amount, which is the
fee for that month.
The table below shows the management fees paid to FMR by each fund for
the last three fiscal years:
Management Fees
Management Fees as a % of Average Net Assets

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1996 1995 1994 1996 1995 1994

Asset Manager: Income $ 2,838,000 $ 2,611,000 $ 2,035,000 .49% .50% .51%

Asset Manager $ 74,474,000 $ 79,977,000 $ 74,497,000 .68% .72% .72%

Asset Manager: Growth $ 20,435,000 $ 20,425,000 $ 17,631,000 .69% .72% .72%

</TABLE>

FMR may, from time to time, voluntarily reimburse all or a portion of each
fund's operating expenses (exclusive of interest, taxes, brokerage
commissions, and extraordinary expenses). 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 each fund's total returns and yield and repayment of
the reimbursement by each fund will lower its total returns and yield.
SUB-ADVISERS. On behalf of Asset Manager, FMR has entered into sub-advisory
agreements with FMR U.K. and FMR Far East. On behalf of Asset Manager:
Income and Asset Manager: Growth, FMR has entered into amended sub-advisory
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 funds, FMR may
also grant the sub-advisers investment management authority as well as the
authority to buy and sell securities if FMR believes it would be beneficial
to the funds.
Currently, FMR U.K. and FMR Far East each focus on issuers in countries
other than the United States such as those in Europe, Asia, and the Pacific
Basin.
FMR U.K. and FMR Far East, which were organized in 1986, are wholly owned
subsidiaries of FMR. 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 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, on behalf of
Asset Manager: Income, Asset Manager and Asset Manager: Growth, the fees
paid to the sub-advisers for fiscal 1996, 1995, and 1994 were as
follows:
FEES PAID TO FOREIGN SUB-ADVISERS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Fund Fees Paid by FMR to FMR U.K. Fees Paid by FMR to FMR Far East

1996 1995 1994 1996 1995 1994

Asset Manager: Income $ 19,000 $ 22,000 $ 12,000 $ 19,000 $ 22,000 $ 17,000

Asset Manager $ 888,000 $ 882,000 N/A $ 917,000 $ 876,000 N/A

Asset Manager: Growth $ 397,000 $ 390,000 $ 168,000 $ 413,000 $ 380,000 $ 221,000

</TABLE>

No fees were paid to any of the sub-advisers on behalf of any of the funds
for providing investment management and executing portfolio transactions on
a discretionary basis.
DISTRIBUTION AND SERVICE PLANS
The Trustees have approved Distribution and Service Plans on behalf of the
funds (the Plans) pursuant to Rule 12b-1 under the Investment Company Act
of 1940 (the Rule). The Rule provides in substance that a mutual fund may
not engage directly or indirectly in financing any activity that is
primarily intended to result in the sale of shares of a fund except
pursuant to a plan approved on behalf of the fund under the Rule. The
Plans, as approved by the Trustees, allow the funds and FMR to incur
certain expenses that might be considered to constitute indirect payment by
the funds of distribution expenses.
Under each Plan, if the payment of management fees by the funds to FMR is
deemed to be indirect financing by the funds of the distribution of their
shares, such payment is authorized by the Plans. Each Plan also
specifically recognizes that FMR, either directly or through FDC, may use
its management fee revenue, past profits, or other resources, without
limitation, to pay promotional and administrative expenses in connection
with the offer and sale of shares of each fund. In addition, each Plan
provides that FMR may use its resources, including its management fee
revenues, to make payments to third parties that assist in selling shares
of each fund, or to third parties, including banks, that render shareholder
support services.
The Trustees have not authorized such payments to date.
Prior to approving each Plan, the Trustees carefully considered all
pertinent factors relating to the implementation of the Plan, and have
determined that there is a reasonable likelihood that the Plan will benefit
the fund and its shareholders. In particular, the Trustees noted that the
Plans do not authorize payments by a fund other than those made to FMR
under its management contract with the fund. To the extent that each Plan
gives FMR and FDC greater flexibility in connection with the distribution
of shares of each fund, additional sales of fund shares may result.
Furthermore, certain shareholder support services may be provided more
effectively under the Plans by local entities with whom shareholders have
other relationships.
The Plans were approved by FMR as the then sole shareholder on July 16,
1992 for Asset Manager: Income; by shareholders of Asset Manager on
September 13, 1989; and by shareholders of Asset Manager: Growth on
September 16, 1992.
The Glass-Steagall Act generally prohibits federally and state chartered or
supervised banks from engaging in the business of underwriting, selling, or
distributing securities. Although the scope of this prohibition under the
Glass-Steagall Act has not been clearly defined by the courts or
appropriate regulatory agencies, FDC believes that the Glass-Steagall Act
should not preclude a bank from performing shareholder support services, or
servicing and recordkeeping functions. FDC intends to engage banks only to
perform such functions. However, changes in federal or state statutes and
regulations pertaining to the permissible activities of banks and their
affiliates or subsidiaries, as well as further judicial or administrative
decisions or interpretations, could prevent a bank from continuing to
perform all or a part of the contemplated services. If a bank were
prohibited from so acting, the Trustees would consider what actions, if
any, would be necessary to continue to provide efficient and effective
shareholder services. In such event, changes in the operation of the funds
might occur, including possible termination of any automatic investment or
redemption or other services then provided by the bank. It is not expected
that shareholders would suffer any adverse financial consequences as a
result of any of these occurrences. In addition, state securities laws on
this issue may differ from the interpretations of federal law expressed
herein, and banks and financial institutions may be required to register as
dealers pursuant to state law.
Each fund may execute portfolio transactions with, and purchase securities
issued by, depository institutions that receive payments under the Plans.
No preference for the instruments of such depository institutions will be
shown in the selection of investments.
CONTRACTS WITH FMR AFFILIATES
FSC, an affiliate of FMR, is transfer, dividend disbursing, and shareholder
servicing agent for each fund. FSC receives an annual account fee and an
asset-based fee each based on account size and fund type for each retail
account and certain institutional accounts. With respect to certain
institutional retirement accounts, FSC receives an annual account fee and
an asset-based fee based on account type or fund type. These annual account
fees are subject to increase based on postal rate changes. 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.
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 shareholders, with the exception of
proxy statements.
FSC also performs the calculations necessary to determine each fund's
NAV and dividends, and maintains each fund's accounting records. The annual
fee rates for these pricing and bookkeeping services are based on each
fund's average net assets, specifically, .0400% for Asset Manager: Income
and .0800% for Asset Manager and Asset Manager: Growth of the first $500
million of average net assets and .0200% for Asset Manager: Income and
.0300% for Asset Manager and Asset Manager: Growth of average net assets in
excess of $500 million. The fee is limited to a minimum of $60,000 and a
maximum of $800,000 per year. Asset Manager: Income is considered a fixed
income fund.
Pricing and Bookkeeping Fees

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1996 1995 1994

Asset Manager: Income $ 219,000 $ 205,000 $ 160,000

Asset Manager $ 878,000 $ 832,000 $ 802,000

Asset Manager: Growth $ 805,000 $ 768,000 $ 719,000

</TABLE>

FSC also receives fees for administering each fund's securities lending
program. Securities lending fees are based on the number and duration of
individual securities loans. Securities lending fees for Asset Manager for
fiscal 1996, 1995, and 1994 were $ 43,000 , $ 46,000 , and
$ 46,000 , respectively. For fiscal 1996, 1995, and 1994 there were no
securities lending fees incurred by Asset Manager: Income and Asset
Manager: Growth.
Each fund has a distribution agreement with FDC, a Massachusetts
corporation organized on July 18, 1960. FDC is a broker-dealer registered
under the Securities Exchange Act of 1934 and is a member of the National
Association of Securities Dealers, Inc. The distribution agreements call
for FDC to use all reasonable efforts, consistent with its other business,
to secure purchasers for shares of each fund, which are continuously
offered at net asset value. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR.
DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. Fidelity Asset Manager: Income, Fidelity Asset Manager,
and Fidelity Asset Manager: Growth are funds of Fidelity Charles Street
Trust, an open-end management investment company organized as a
Massachusetts business trust on July 7, 1981. Currently, there are 7 funds
of the trust: Fidelity Asset Manager: Income, Fidelity Asset Manager,
Fidelity Asset Manager: Growth, Fidelity Short-Intermediate Government Fund
(formerly Fidelity Limited Maturity Government Fund), Spartan Investment
Grade Bond Fund, Spartan Short-Term Bond Fund, and Fidelity U.S. Government
Reserves. The Declaration of Trust permits the Trustees to create
additional funds.
In the event that FMR ceases to be the investment adviser to the trust or a
fund, the right of the trust or fund to use the identifying names
"Fidelity" and "Spartan" may be withdrawn. There is a remote possibility
that one fund might become liable for any misstatement in its prospectus or
statement of additional information about another fund.
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 only
to the rights of creditors, are especially allocated to such fund, and
constitute the underlying assets of such fund. The underlying assets of
each fund are segregated on the books of account, and are to be charged
with the liabilities with respect to such fund and with a share of the
general expenses of the trust. Expenses with respect to the trust are to be
allocated in proportion to the asset value of the respective funds, except
where allocations of direct expense can otherwise be fairly made. The
officers of the trust, subject to the general supervision of the Board of
Trustees, have the power to determine which expenses are allocable to a
given fund, or which are general or allocable to all of the funds. In the
event of the dissolution or liquidation of the trust, shareholders of each
fund are entitled to receive as a class the underlying assets of such fund
available for distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The trust is an entity of the type
commonly known as "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 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 shall include a provision limiting the obligations
created thereby to the trust and its assets. The Declaration of Trust
provides for indemnification out of each fund's property of any
shareholders held personally liable for the obligations of the fund. 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 the 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.
The Declaration of Trust further provides that the Trustees, if they have
exercised reasonable care, will not be liable for any neglect or
wrongdoing, but nothing in the Declaration of Trust protects Trustees
against any liability to which they would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless disregard of
the duties involved in the conduct of their office.
VOTING RIGHTS. Each fund's capital consists of shares of beneficial
interest. As a shareholder, you receive one vote for each dollar value of
net asset value you own. The shares have no preemptive or conversion
rights; the voting and dividend rights, the right of redemption, and the
privilege of exchange are described in the Prospectus. Shares are fully
paid and nonassessable, except as set forth under the heading "Shareholder
and Trustee Liability" above. Shareholders representing 10% or more of the
trust or a fund may, as set forth in the Declaration of Trust, call
meetings of the trust or a fund for any purpose related to the trust or
fund, as the case may be, including, in the case of a meeting of the entire
trust, the purpose of voting on removal of one or more Trustees. The trust
or any fund may be terminated upon the sale of its assets to another
open-end management investment company, or upon liquidation and
distribution of its assets, if approved by vote of the holders of a
majority of the trust or the fund, as determined by the current value of
each shareholder's investment in the fund or trust. If not so terminated,
the trust and the funds will continue indefinitely. Each fund may invest
all of its assets in another investment company.
CUSTODIAN. The Chase Manhattan Bank, 4 Chase MetroTech Center, Brooklyn,
New York, is custodian of the assets of the funds. The custodian is
responsible for the safekeeping of a fund's assets and the appointment of
any subcustodian banks and clearing agencies. The custodian takes no part
in determining the investment policies of a fund or in deciding which
securities are purchased or sold by a fund. However, a fund may invest in
obligations of the custodian and may purchase securities from or sell
securities to the custodian.
FMR, its officers and directors, its affiliated companies, and the Board of
Trustees may, from time to time, conduct transactions with various banks,
including banks serving as custodians for certain funds advised by FMR.
Transactions that have occurred to date include mortgages and personal and
general business loans. In the judgment of FMR, the terms and conditions of
those transactions were not influenced by existing or potential custodial
or other fund relationships.
AUDITOR. Price Waterhouse LLP, 160 Federal Street, Boston, Massachusetts
serves as the trust's independent accountant. 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 September 30, 1996, and report s of the
auditors , are included in the funds ' Annual Report, which
are separate report s supplied with this SAI . Each
fund's financial statements, including the financial
highlights , and report s of the auditors are incorporated
herein by reference. For a free additional copy of a fund's Annual
Report, contact Fidelity at 1-800-544-8888, 82 Devonshire Street, Boston,
MA 02109.
APPENDIX
The descriptions that follow are examples of eligible ratings for the
funds. A fund may, however, consider the ratings for other types of
investments and the ratings assigned by other rating organizations when
determining the eligibility of a particular investment.
DESCRIPTION OF MOODY'S INVESTORS SERVICE RATINGS OF CORPORATE BONDS :
Moody's ratings for obligations with an original remaining maturity in
excess of one year fall within nine categories. They range from Aaa
(highest quality) to C (lowest quality). Moody applies numerical modifiers
of 1, 2, or 3 to each generic rating classification from Aa through B. The
modifier 1 indicates that the security ranks in the higher end of its
generic rating category; the modifier 2 indicates a mid-range ranking; and
the modifier 3 indicates that the issue ranks on the lower end of its
generic rating category.
AAA - Bonds that are rated Aaa are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally
referred to as "gilt edged." Interest payments are protected by a large or
by an exceptionally stable margin and principal is secure. While the
various protective elements are likely to change, such changes as can be
visualized are most unlikely to impair the fundamentally strong position of
such issues.
AA - Bonds that are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally
known as high-grade bonds. They are rated lower than the best bonds because
margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than the Aaa securities.
A - Bonds that are rated A possess many favorable investment
attributes and are to be considered as upper-medium-grade obligations.
Factors giving security to principal and interest are considered adequate
but elements may be present which suggest a susceptibility to impairment
sometime in the future.
BAA - Bonds that are rated Baa are considered as medium-grade
obligations, (i.e., they are neither highly protected nor poorly secured).
Interest payments and principal security appear adequate for the present
but certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding
investment characteristics and in fact have speculative characteristics as
well.
BA - Bonds that are rated Ba are judged to have speculative
elements; their future cannot be considered as well assured. Often the
protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the
future. Uncertainty of position characterizes bonds in this class.
B - Bonds that are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may
be small.
CAA - Bonds that are rated Caa are of poor standing. Such issues may
be in default or there may be present elements of danger with respect to
principal or interest.
CA - Bonds that are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default or have
other marked short-comings.
C - Bonds that are rated C are the lowest-rated class of bonds and
issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.
DESCRIPTION OF STANDARD & POOR'S RATINGS OF CORPORATE BONDS :
Debt issues may be designated by Standard & Poor's as either investment
grade ("AAA" through "BBB") or speculative grade ("BB" through "D"). While
speculative grade debt will likely have some quality and protective
characteristics, these are outweighted by large uncertainties or major
exposures to adverse conditions. Ratings from AA to CCC may be modified by
the addition of a plus sign (+) or minus sign (-) to show relative standing
within the major rating categories.
AAA - Debt rated AAA has the highest rating assigned by Standard & Poor's
to a debt obligation. Capacity to pay interest and repay principal is
extremely strong.
AA - Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher-rated issues only in small degree.
A - Debt rated A has a strong capacity to pay interest and repay principal,
although it is somewhat more susceptible to the adverse effects of changes
in circumstances and economic conditions than debt in higher rated
categories.
BBB - Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for debt in this category than in higher-rated
categories.
BB - Debt rated BB has less near-term vulnerability to default than other
speculative issues. However, it faces major ongoing uncertainties or
exposure to adverse business, financial, or economic conditions which could
lead to inadequate capacity to meet timely interest and principal payments.
The BB rating category is also used for debt subordinated to senior debt
that is assigned an actual or implied BBB- rating.
B - Debt rated B has a greater vulnerability to default but currently has
the capacity to meet interest payments and principal repayments. Adverse
business, financial, or economic conditions will likely impair capacity or
willingness to pay interest and repay principal. The B rating category is
also used for debt subordinated to senior debt that is assigned an actual
or implied BB or BB- rating.
CCC - Debt rated CCC has a currently identifiable vulnerability to default,
and is dependent upon favorable business, financial, and economic
conditions to meet timely payment of interest and repayment of principal.
In the event of adverse business, financial, or economic conditions, it is
not likely to have the capacity to pay interest and repay principal. The
CCC rating category is also used for debt subordinated to senior debt that
is assigned an actual or implied B or B- rating.
CC - Debt rated CC is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC debt rating.
C - The rating C is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC- debt rating. The C rating may
be used to cover a situation where a bankruptcy petition has been filed but
debt service payments are continued.
CI - The rating CI is reserved for income bonds on which no interest is
being paid.
D - Debt rated D is in payment default. The D rating category is used when
interest payments or principal payments are not made on the date due even
if the applicable grace period has not expired, unless S&P believes that
such payments will be made during such grace period. The D rating will also
be used upon the filing of a bankruptcy petition if debt service payments
are jeopardized.
Spartan is a registered trademark of FMR Corp.
Fidelity Asset Manager is a trademark of FMR Corp.
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a)(1) The Financial Statements and Financial Highlights, included in the
Annual Report, for Fidelity Asset Manager: Income for the fiscal year ended
September 30, 1996, are incorporated herein by reference into the fund's
Statement of Additional Information and were filed on November 18, 1996,
for Fidelity Charles Street Trust (File No. 811-3221) pursuant to Rule
30d-1under the Investment Company Act of 1940 and are incorporated herein
by reference.
(a)(2) The Financial Statements and Financial Highlights, included in the
Annual Report, for Fidelity Asset Manager for the fiscal year ended
September 30, 1996, are incorporated herein by reference into the fund's
Statement of Additional Information and were filed on November 18, 1996,
for Fidelity Charles Street Trust (File No. 811-3221) pursuant to Rule
30d-1under the Investment Company Act of 1940 and are incorporated herein
by reference.
(a)(3) The Financial Statements and Financial Highlights, included in the
Annual Report, for Fidelity Asset Manager: Growth for the fiscal year ended
September 30, 1996, are incorporated herein by reference into the fund's
Statement of Additional Information and were filed on November 18, 1996,
for Fidelity Charles Street Trust (File No. 811-3221) pursuant to Rule
30d-1under the Investment Company Act of 1940 and are incorporated herein
by reference.
(b) Exhibits:
(1) Amended and Restated Declaration of Trust, dated November 17, 1994,
was electronically filed and is incorporated herein by reference to Exhibit
1 to Post-Effective Amendment No. 54.
(2) By-Laws of the Trust, as amended, are incorporated herein by
reference to Exhibit 2(a) to Fidelity Union Street Trust's (File No.
2-50318) Post-Effective Amendment No. 87.
(3) Not applicable.
(4) Not applicable.
(5)(a) Management Contract between Fidelity Short-Intermediate
Government Fund (formerly Fidelity Limited Maturity Government Fund) and
Fidelity Management & Research Company, dated October 1, 1994, is
incorporated herein by reference to Exhibit 5(a) of Post-Effective
Amendment No. 52.
(b) Management Contract between Fidelity Asset Manager and
Fidelity Management & Research Company, dated October 1, 1994, is
incorporated herein by reference to Exhibit 5(c) of Post-Effective
Amendment No. 52.
(c) Management Contract between Fidelity Asset Manager: Growth and
Fidelity Management & Research Company, dated October 1, 1994, is
incorporated herein by reference to Exhibit 5(d) of Post-Effective
Amendment No. 52.
(d) Management Contract between Fidelity Asset Manager: Income and
Fidelity Management & Research Company, dated October 1, 1994, is
incorporated herein by reference to Exhibit 5(e) of Post-Effective
Amendment No. 52.
(e) Management Contract between Spartan Investment Grade Bond Fund
and Fidelity Management & Research Company, dated September 17, 1992, is
incorporated herein by reference to Exhibit 5(f) of Post-Effective
Amendment No. 46.
(f) Management Contract between Spartan Short-Term Bond Fund
(formerly Spartan Short-Term Income Fund) and Fidelity Management &
Research Company, dated September 17, 1992, is incorporated herein by
reference to Exhibit 5(g) of Post-Effective Amendment No. 46.
(g) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (U.K.) Inc., on behalf of
Fidelity Asset Manager, dated October 1, 1994, is incorporated herein by
reference to Exhibit 5(i) of Post-Effective Amendment No. 52.
(h) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (Far East) Inc., on behalf of
Fidelity Asset Manager, dated October 1, 1994, is incorporated herein by
reference to Exhibit 5(j) of Post-Effective Amendment No. 52.
(i) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (U.K.) Inc., on behalf of
Fidelity Asset Manager: Growth, dated October 1, 1994, is incorporated
herein by reference to Exhibit 5(k) of Post-Effective Amendment No. 52.
(j) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (Far East) Inc., on behalf of
Fidelity Asset Manager: Growth, dated October 1, 1994, is incorporated
herein by reference to Exhibit 5(l) of Post-Effective Amendment No. 52.
(k) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (U.K.) Inc., on behalf of
Fidelity Asset Manager: Income, dated October 1, 1994, is incorporated
herein by reference to Exhibit 5(m) of Post-Effective Amendment No. 52.
(l) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (Far East) Inc., on behalf of
Fidelity Asset Manager: Income, dated October 1, 1994, is incorporated
herein by reference to Exhibit 5(n) of Post-Effective Amendment No. 52.
(m) Sub-Advisory Agreement between Fidelity Management & Research Company
and Fidelity Management & Research (U.K.) Inc., on behalf of Spartan
Investment Grade Bond Fund, dated October 1, 1994, is incorporated herein
by reference to Exhibit 5(o) of Post-Effective Amendment No. 52.
(n) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (Far East) Inc., on behalf of
Spartan Investment Grade Bond Fund, dated October 1, 1994, is incorporated
herein by reference to Exhibit 5(p) of Post-Effective Amendment No. 52.
(o) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (U.K.) Inc., on behalf of
Spartan Short-Term Bond Fund (formerly Spartan Short-Term Income Fund),
dated October 1, 1994, is incorporated herein by reference to Exhibit 5(q)
of Post-Effective Amendment No. 52.
(p) Sub-Advisory Agreement between Fidelity Management & Research
Company and Fidelity Management & Research (Far East) Inc., on behalf of
Spartan Short-Term Bond Fund (formerly Spartan Short-Term Income Fund),
dated October 1, 1994, is incorporated herein by reference to Exhibit 5(r)
of Post-Effective Amendment No. 52.
(6)(a) General Distribution Agreement between Fidelity Asset Manager and
Fidelity Distributors Corporation, dated December 28, 1988, is incorporated
herein by reference to Exhibit 6(b) of Post-Effective Amendment No. 51.
(b) General Distribution Agreement between Fidelity Asset Manager:
Growth and Fidelity Distributors Corporation, dated September 21, 1990, is
incorporated herein by reference to Exhibit 6(d) of Post-Effective
Amendment No. 52.
(c) General Distribution Agreement between Fidelity
Short-Intermediate Government Fund (formerly Fidelity Limited Maturity
Government Fund) and Fidelity Distributors Corporation, dated September 5,
1991, is incorporated herein by reference to Exhibit 6(e) of Post-Effective
Amendment No. 52.
(d) General Distribution Agreement between Fidelity Asset Manager:
Income and Fidelity Distributors Corporation, dated July 16, 1992, is
incorporated herein by reference to Exhibit 6(f) of Post-Effective
Amendment No. 52.
(e) General Distribution Agreement between Spartan
Investment-Grade Bond Fund and Fidelity Distributors Corporation, dated
September 17, 1992, is incorporated herein by reference to Exhibit 6(g) of
Post-Effective Amendment No. 46.
(f) General Distribution Agreement between Spartan Short-Term Bond
Fund (formerly Spartan Short-Term Income Fund) and Fidelity Distributors
Corporation, dated September 17, 1992, is incorporated herein by reference
to Exhibit 6(h) of Post-Effective Amendment No. 46.
(g) Amendment to General Distribution Agreement between Fidelity
Short-Intermediate Government Fund (formerly Fidelity Limited Maturity
Government Fund), Spartan Investment Grade Bond Fund, and Spartan
Short-Term Bond Fund (formerly Spartan Short-Term Income Fund) and Fidelity
Distributors Corporation, dated May 10, 1994, is incorporated herein by
reference to Exhibit 6(i) of Post-Effective Amendment No. 52.
(h) Amendments to the General Distribution Agreement between the
Registrant and Fidelity Distributors Corporation, dated March 14, 1996 and
July 15, 1996, are incorporated herein by reference to Exhibit 6(a) of
Fidelity Court Street Trust's Post-Effective Amendment No. 61 (File No.
2-58774).
(7)(a) Retirement Plan for Non-Interested Person Trustees, Directors or
General Partners, as amended on November 16, 1995, is incorporated herein
by reference to Exhibit 7(a) of Fidelity Select Portfolio's (File No.
2-69972) Post-Effective Amendment No. 54.
(b) The Fee Deferral Plan for Non-Interested Person Directors and
Trustees of the Fidelity Funds, effective as of December 1, 1995, is
incorporated herein by reference to Exhibit 7(b) of Fidelity School Street
Trust's (File No. 2-57167) Post-Effective Amendment No. 47.
(8)(a) Custodian Agreement and Appendix C, dated August 1, 1994, between
The Chase Manhattan Bank, N.A. and Fidelity Charles Street Trust on behalf
of Fidelity Asset Manager, Fidelity Asset Manager: Income, and Fidelity
Asset Manager: Growth is incorporated herein by reference to Exhibit 8(a)
of Fidelity Investment Trust's Post-Effective Amendment No. 59 (File No.
2-90649).
(b) Appendix B, dated July 18, 1996, to the Custodian Agreement, dated
August 1, 1994, between The Chase Manhattan Bank, N.A. and Fidelity Charles
Street Trust on behalf of Fidelity Asset Manager, Fidelity Asset Manager:
Income, and Fidelity Asset Manager: Growth is incorporated herein by
reference to Exhibit 8(b) of Fidelity Securities Fund's Post-Effective
Amendment No. 35 (File No. 2-93601).
(c) Appendix A, dated October 17, 1996, to the Custodian Agreement,
dated August 1, 1994, between The Chase Manhattan Bank, N.A. and Fidelity
Charles Street Trust on behalf of Fidelity Asset Manager, Fidelity Asset
Manager: Income, and Fidelity Asset Manager: Growth is incorporated herein
by reference to Exhibit 8(c) of Post-Effective Amendment No. 57.
(d) Custodian Agreement and Appendix C, dated December 1, 1994,
between The Bank of New York and Fidelity Charles Street Trust on behalf of
Fidelity Short-Intermediate Government Fund, Spartan Short-Term Bond Fund,
and Spartan Investment Grade Bond Fund is incorporated herein by reference
to Exhibit 8(a) of Fidelity Hereford Street Trust's Post-Effective
Amendment No. 4 (File No. 33-52577).
(e) Appendix A, dated August 31, 1996, to the Custodian Agreement,
dated December 1, 1994, between The Bank of New York and Fidelity Charles
Street Trust on behalf of Fidelity Short-Intermediate Government Fund,
Spartan Short-Term Bond Fund, and Spartan Investment Grade Bond Fund is
incorporated herein by reference to Exhibit 8(b) of Daily Money Fund's
Post-Effective Amendment No. 40 (File No. 2-77909).
(f) Appendix B, dated July 31, 1996, to the Custodian Agreement, dated
December 1, 1994, between The Bank of New York and Fidelity Charles Street
Trust on behalf of Fidelity Short-Intermediate Government Fund, Spartan
Short-Term Bond Fund, and Spartan Investment Grade Bond Fund is
incorporated herein by reference to Exhibit 8(c) of Fidelity Income Fund's
Post-Effective Amendment No. 35 (File No. 2-92661).
(g) Fidelity Group Repo Custodian Agreement among The Bank of New York,
J. P. Morgan Securities, Inc., and the Registrant, 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.
(h) Schedule 1 to the Fidelity Group Repo Custodian Agreement between
The Bank of New York and the Registrant, 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.
(i) Fidelity Group Repo Custodian Agreement among Chemical Bank,
Greenwich Capital Markets, Inc., and the Registrant, 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.
(j) Schedule 1 to the Fidelity Group Repo Custodian Agreement between
Chemical Bank and the Registrant, 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.
(k) Joint Trading Account Custody Agreement between The Bank of New
York and the Registrant, 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.
(l) First Amendment to Joint Trading Account Custody Agreement between
The Bank of New York and the Registrant, 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.
(9) Not applicable.
(10) Not applicable.
(11) Consent of Price Waterhouse LLP is filed herein as Exhibit 11.
(12) Not applicable.
(13) Not applicable.
(14) (a) Fidelity Individual Retirement Account Custodial Agreement and
Disclosure Statement, as currently in effect, is incorporated herein by
reference to Exhibit 14(a) of Fidelity Union Street Trust's (File No.
2-50318) Post-Effective Amendment No. 87.
(b) Fidelity Institutional Individual Retirement Account Custodial
Agreement and Disclosure Statement, as currently in effect, is incorporated
herein by reference to Exhibit 14(d) of Fidelity Union Street Trust's (File
No. 2-50318) Post-Effective Amendment No. 87.
(c) National Financial Services Corporation Individual Retirement Account
Custodial Agreement and Disclosure Statement, as currently in effect, is
incorporated herein by reference to Exhibit 14(h) of Fidelity Union Street
Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
(d) Fidelity Portfolio Advisory Services Individual Retirement Account
Custodial Agreement and Disclosure Statement, as currently in effect, is
incorporated herein by reference to Exhibit 14(i) of Fidelity Union Street
Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
(e) Fidelity 403(b)(7) Custodial Account Agreement, as currently in
effect, is incorporated herein by reference to Exhibit 14(e) of Fidelity
Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
(f) National Financial Services Corporation Defined Contribution
Retirement Plan and Trust Agreement, as currently in effect, is
incorporated herein by reference to Exhibit 14(k) of Fidelity Union Street
Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
(g) The CORPORATEplan for Retirement Profit Sharing/401K Plan, as
currently in effect, is incorporated herein by reference to Exhibit 14(l)
of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective
Amendment No. 87.
(h) The CORPORATEplan for Retirement Money Purchase Pension Plan, as
currently in effect, is incorporated herein by reference to Exhibit 14(m)
of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective
Amendment No. 87.
(i) Fidelity Investments Section 403(b)(7) Individual Custodial Account
Agreement and Disclosure Statement, as currently in effect, is incorporated
herein by reference to Exhibit 14(f) of Fidelity Commonwealth Trust's (File
No. 2-52322) Post Effective Amendment No. 57.
(j) Plymouth Investments Defined Contribution Retirement Plan and Trust
Agreement, as currently in effect, is incorporated herein by reference to
Exhibit 14(o) of Fidelity Commonwealth Trust's (File No. 2-52322) Post
Effective Amendment No. 57.
(k) The Fidelity Prototype Defined Benefit Pension Plan and Trust Basic
Plan Document and Adoption Agreement, as currently in effect, is
incorporated herein by reference to Exhibit 14(d) of Fidelity Securities
Fund's (File No. 2-93601) Post Effective Amendment No. 33.
(l) The Institutional Prototype Plan Basic Plan Document, Standardized
Adoption Agreement, and Non-Standardized Adoption Agreement, as currently
in effect, is incorporated herein by reference to Exhibit 14(o) of Fidelity
Securities Fund's (File No. 2-93601) Post Effective Amendment No. 33.
(m) The CORPORATEplan for Retirement 100SM Profit Sharing/401(k) Basic
Plan Document, Standardized Adoption Agreement, and Non-Standardized
Adoption Agreement, as currently in effect, is incorporated herein by
reference to Exhibit 14(f) of Fidelity Securities Fund's (File No. 2-93601)
Post Effective Amendment No. 33.
(n) The Fidelity Investments 401(a) Prototype Plan for Tax-Exempt
Employers Basic Plan Document, Standardized Profit Sharing Plan Adoption
Agreement, Non-Standardized Discretionary Contribution Plan No. 002
Adoption Agreement, and Non-Standardized Discretionary Contribution Plan
No. 003 Adoption Agreement, as currently in effect, is incorporated herein
by reference to Exhibit 14(g) of Fidelity Securities Fund's (File No.
2-93601) Post Effective Amendment No. 33.
(o) Fidelity Investments 403(b) Sample Plan Basic Plan Document and
Adoption Agreement, as currently in effect, is incorporated herein by
reference to Exhibit 14(p) of Fidelity Securities Fund's (File No. 2-93601)
Post Effective Amendment No. 33.
(p) Fidelity Defined Contribution Retirement Plan and Trust Agreement, as
currently in effect, is incorporated herein by reference to Exhibit 14(c)
of Fidelity Securities Fund's (File No. 2-93601) Post Effective Amendment
No. 33.
(15) (a) Distribution and Service Plan pursuant to Rule 12b-1 for Fidelity
Asset Manager is incorporated herein by reference to Exhibit 15(b) of
Post-Effective Amendment No. 52.
(b) Distribution and Service Plan pursuant to Rule l2b-l for Fidelity
Asset Manager: Growth is incorporated herein by reference to Exhibit 15(c)
of Post-Effective Amendment No. 52.
(c) Distribution and Service Plan pursuant to Rule 12b-1 for Fidelity
Short-Intermediate Government Fund (formerly Fidelity Limited Maturity
Government Fund) is incorporated herein by reference to Exhibit 15(d) of
Post-Effective Amendment No. 52.
(d) Distribution and Service Plan pursuant to Rule 12b-1 for Fidelity
Asset Manager: Income is incorporated herein by reference to Exhibit 15(e)
of Post-Effective Amendment No. 52.
(e) Distribution and Service Plan pursuant to Rule 12b-1 for Spartan
Investment Grade Bond Fund is incorporated herein by reference to Exhibit
15(f) of Post-Effective Amendment No. 52.
(f) Distribution and Service Plan pursuant to Rule 12b-1 for Spartan
Short-Term Bond Fund (formerly Spartan Short-Term Income Fund) is
incorporated herein by reference to Exhibit 15(g) of Post-Effective
Amendment No. 52.
(16) (a) A schedule for computation of 30-day yields and total return is
incorporated herein by reference to Exhibit 16(a) of Post-Effective
Amendment No. 54.
(b) A schedule for computation of moving averages for Fidelity Asset
Manager is incorporated herein by reference to Exhibit 16(b) of
Post-Effective Amendment No. 48.
(17) Financial Data Schedules are incorporated herein by reference to
Exhibit 27 of Post-Effective Amendment No. 58.
(18) Not applicable.
Item 25. Persons Controlled by or under Common Control with Registrant
The Registrant's Board of Trustees is the same as the boards of other
funds managed by Fidelity Management & Research Company. In addition, the
officers of these funds are substantially identical. Nonetheless,
Registrant takes the position that it is not under common control with
these other funds since the power residing in the respective boards and
officers arises as the result of an official position with the respective
funds.
Item 26. Number of Holders of Securities: December 31, 1996

Title of Class: Shares of Beneficial Interest
Name of Series Number of Recordholders

Fidelity Asset Manager 1,125,616

Fidelity Asset Manager: Growth 406,782

Fidelity Asset Manager: Income 99,546

Fidelity Short-Intermediate Government Fund 11,661

Spartan Investment Grade Bond Fund 11,884

Spartan Short-Term Bond Fund 9,793

Item 27. 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
Registrant 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 in connection with any claim, action, suit, or
proceeding in which he is involved by virtue of his service as a Trustee,
an officer, or both. Additionally, amounts paid or incurred in settlement
of such matters are covered by this indemnification. Indemnification will
not be provided in certain circumstances, however. These include instances
of willful misfeasance, bad faith, gross negligence, and reckless disregard
of the duties involved in the conduct of the particular office involved.
Pursuant to Section 11 of the Distribution Agreement, the Registrant
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 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 Registrant
included a materially misleading statement or omission. However, the
Registrant 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 Registrant by or on behalf
of the Distributor. The Registrant does not agree to indemnify the parties
against any liability to which they would be subject by reason of willful
misfeasance, bad faith, gross negligence, and reckless disregard of the
obligations and duties under the Distribution Agreement.
Pursuant to the agreement by which Fidelity Service Company, Inc.
("Service") is appointed transfer agent, the Registrant agrees to indemnify
and hold Service 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
Registrant, including by a shareholder, which names the Service and/or the
Registrant as a party and is not based on and does not result from
Service's willful misfeasance, bad faith or negligence or reckless
disregard of duties, and arises out of or in connection with Service's
performance under the Transfer Agency Agreement; or
(2) any claim, demand, action or suit (except to the extent contributed to
by Service's willful misfeasance, bad faith or negligence or reckless
disregard of duties) which results from the negligence of the Registrant,
or from Service's acting upon any instruction(s) reasonably believed by it
to have been executed or communicated by any person duly authorized by the
Registrant, or as a result of Service's acting in reliance upon advice
reasonably believed by Service to have been given by counsel for the
Registrant, or as a result of Service'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 28. Business and Other Connections of Investment Adviser

(1) FIDELITY MANAGEMENT & RESEARCH COMPANY (FMR)
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 Executive Committee of FMR;
President and Chief Executive Officer of FMR Corp.;
Chairman of the Board and Director of FMR, FMR
Corp., FMR Texas Inc., FMR (U.K.) Inc., and FMR
(Far East) Inc.; Chairman of the Board and
Representative Director of Fidelity Investments Japan
Limited; President and Trustee of funds advised by
FMR.

J. Gary Burkhead President and Director of FMR, FMR Texas Inc., FMR
(U.K.) Inc., and FMR (Far East) Inc.; Managing
Director of FMR Corp.; Senior Vice President and
Trustee of funds advised by FMR.

Peter S. Lynch Vice Chairman of the Board and Director of FMR.

Marta Amieva Vice President of FMR.

Dwight D. Churchill Vice President of FMR.

John D. Crumrine Assistant Treasurer of FMR, FMR (U.K.) Inc., FMR
(Far East) Inc., and FMR Texas Inc.; Vice President
and Treasurer of FMR Corp.

William Danoff Vice President of FMR and of a fund advised by FMR.

Scott E. DeSano Vice President of FMR.

Craig P. Dinsell Vice President of FMR.

Penelope Dobkin Vice President of FMR and of a fund advised by FMR.

George C. Domolky Vice President of FMR.

Larry A. Domash Vice President of FMR.

Bettina Doulton Vice President of FMR and of funds advised by FMR.

Margaret L. Eagle Vice President of FMR and a fund advised by 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.) Inc., and FMR (Far East) Inc.; Secretary of
FMR Texas Inc.

Robert Gervis Vice President of FMR.

David L. Glancy Vice President of FMR and of a fund advised by FMR.

Kevin E. Grant Vice President of FMR and of funds advised by FMR.

Barry A. Greenfield Vice President of FMR and of a fund advised by FMR.

Boyce I. Greer Vice President of FMR.

Bart Grenier Vice President of FMR.

Robert Haber Vice President of FMR.

Richard C. Habermann Senior Vice President of FMR; Vice President of funds
advised by FMR.

William J. Hayes Senior Vice President of FMR; Vice President of
Equity funds advised by FMR.

Richard Hazlewood Vice President of FMR and of a fund advised by FMR.

Fred L. Henning Jr. Senior Vice President of FMR; Vice President of
Fixed-Income funds advised by FMR.

John R. Hickling Vice President of FMR and of a fund advised by FMR.

Robert F. Hill Vice President of FMR; Director of Technical
Research.

Curt Hollingsworth Vice President of FMR and of funds advised by FMR.

Abigail P. Johnson Vice President of FMR and of a fund advised by FMR.

Stephen P. Jonas Vice President of FMR; Treasurer of FMR, FMR
(U.K.) Inc., FMR (Far East) Inc., and FMR Texas Inc.

David B. Jones Vice President of FMR.

Steven Kaye Vice President of FMR and of a fund advised by FMR.

Francis V. Knox Vice President of FMR; Compliance Officer of FMR
(U.K.) Inc.

David P. Kurrasch Vice President of FMR.

Robert A. Lawrence Senior Vice President of FMR; Vice President of High
Income funds advised by FMR.

Alan Leifer Vice President of FMR.

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.

Arthur S. Loring Senior Vice President, Clerk, and General Counsel of
FMR; Vice President/Legal, and Assistant Clerk of
FMR Corp.; Secretary of funds advised by FMR.

Richard R. Mace Jr. Vice President of FMR and of funds advised by FMR.

Malcolm W. MacNaught II Vice President of FMR and of a fund advised by FMR.

Robert H. Morrison Vice President of FMR; Director of Equity Trading.

David L. Murphy Vice President of FMR and of funds advised by FMR.

Jacques Perold Vice President of FMR.

Anne Punzak Vice President of FMR.

Kenneth A. Rathgeber Vice President of FMR; Treasurer 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.

Thomas T. Soviero Vice President of FMR and of a fund advised by FMR.

Richard Spillane Vice President of FMR; Senior Vice President and
Director of Operations and Compliance of FMR (U.K.)
Inc.

Robert E. Stansky Senior Vice President of FMR; Vice President of a
fund advised by FMR.

Thomas Sweeney Vice President of FMR and of a fund advised by FMR.

Beth F. Terrana Senior Vice President of FMR; 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; Vice President of funds
advised by FMR.

</TABLE>

(2) FIDELITY MANAGEMENT & RESEARCH (U.K.) INC. (FMR U.K.)
Pembroke Hall, 42 Crow Lane, Pembroke, Bermuda
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., FMR Texas Inc., and FMR (Far
East) Inc.; Chairman of the Executive Committee of
FMR; President and Chief Executive Officer of FMR
Corp.; Chairman of the Board and Representative
Director of Fidelity Investments Japan Limited;
President and Trustee of funds advised by FMR.

J. Gary Burkhead President and Director of FMR U.K., FMR, FMR (Far
East) Inc., and FMR Texas Inc.; Managing Director of
FMR Corp.; Senior Vice President and Trustee of
funds advised by FMR.

Richard Spillane Senior Vice President and Director of Operations and
Compliance of FMR U.K.; Vice President of FMR.

Stephen P. Jonas Treasurer of FMR U.K., FMR, FMR (Far East) Inc.,
and FMR Texas Inc.; Vice President of FMR.

John D. Crumrine Assistant Treasurer of FMR U.K., FMR, FMR (Far
East) Inc., and FMR Texas Inc.; Vice President and
Treasurer of FMR Corp.

Francis V. Knox Compliance Officer of FMR U.K.; Vice President of
FMR.

Jay Freedman Clerk of FMR U.K., FMR (Far East) Inc., and FMR
Corp.; Assistant Clerk of FMR; Secretary of FMR
Texas Inc.

(3) FIDELITY MANAGEMENT & RESEARCH COMPANY (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., FMR Texas Inc., and
FMR (U.K.) Inc.; Chairman of the Executive
Committee of FMR; President and Chief
Executive Officer of FMR Corp.; Chairman of
the Board and Representative Director of
Fidelity Investments Japan Limited; President
and Trustee of funds advised by FMR.

J. Gary Burkhead President and Director of FMR Far East, FMR
Texas Inc., FMR, and FMR (U.K.) Inc.;
Managing Director of FMR Corp.; Senior Vice
President and Trustee of funds advised by FMR.

William R. Ebsworth Vice President of FMR Far East; Director of
FIIA.

Bill Wilder Vice President of FMR Far East; President and
Representative Director of Fidelity Investments
Japan Limited.

Stephen P. Jonas Treasurer of FMR Far East, FMR, FMR (U.K.)
Inc., and FMR Texas Inc.; Vice President of
FMR.

John D. Crumrine Assistant Treasurer of FMR Far East, FMR,
FMR (U.K.) Inc., and FMR Texas Inc.; Vice
President and Treasurer of FMR Corp.

Jay Freedman Clerk of FMR Far East, FMR (U.K.) Inc., and
FMR Corp.; Assistant Clerk of FMR; Secretary
of FMR Texas Inc.

Item 29. Principal Underwriters
(a) Fidelity Distributors Corporation (FDC) acts as distributor for most
funds advised by FMR.
(b)

Name and Principal Positions and Offices Positions and Offices

Business Address* With Underwriter With Registrant

Edward C. Johnson 3d Director Trustee and President

Michael Mlinac Director None

Mark Peterson Director None

Paul Hondros President None

Arthur S. Loring Vice President and Clerk 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 30. Location of Accounts and Records
All accounts, books, and other documents required to be maintained by
Section 31a of the 1940 Act and the Rules promulgated thereunder are
maintained by Fidelity Management & Research Company or Fidelity Service
Co., 82 Devonshire Street, Boston, MA 02109, or each fund's respective
custodian: The Bank of New York, 110 Washington Street, New York, N.Y. and
The Chase Manhattan Bank, 4 Chase MetroTech Center, Brooklyn, N.Y.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a) The Registrant undertakes for Fidelity Asset Manager: Income, Spartan
Investment Grade Bond Fund, and Spartan Short-Term Bond Fund: 1) to call a
meeting of shareholders for the purpose of voting upon the question 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 Asset Manager: Income, Fidelity
Asset Manager, Fidelity Asset Manager: Growth, Fidelity Short-Intermediate
Government Fund, Spartan Investment Grade Bond Fund and Spartan Short-Term
Bond Fund undertakes, provided the information required by Item 5A is
contained in the annual report, to furnish 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.
POWER OF ATTORNEY
I, the undersigned President and Director, Trustee, or General Partner, as
the case may be, of the following investment companies:

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

</TABLE>

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 President and Director, Trustee, or
General Partner (collectively, the "Funds"), hereby constitute and appoint
J. Gary Burkhead 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, Form N-8B-2, 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
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 January 3, 1997.
WITNESS my hand on the date set forth below.
/s/Edward C. Johnson 3d January 3, 1997

Edward C. Johnson 3d

POWER OF ATTORNEY
I, the undersigned Treasurer and principal financial and accounting
officer of the following investment companies:

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

</TABLE>

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 President and Director, Trustee, or
General Partner (collectively, the "Funds"), hereby constitute and appoint
John H. Costello and John E. Ferris 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 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 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 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 my hand on the date set forth below.
/s/Kenneth A. Rathgeber__________ December 19, 1996

Kenneth A. Rathgeber

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

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

</TABLE>

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 3d___________ /s/Peter S. Lynch________________

Edward C. Johnson 3d Peter S. Lynch

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

J. Gary Burkhead William O. McCoy

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

Ralph F. Cox Gerald C. McDonough

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

Phyllis Burke Davis Marvin L. Mann

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

E. Bradley Jones Thomas R. Williams

/s/Donald J. Kirk __________________

Donald J. Kirk

POWER OF ATTORNEY
I, the undersigned Secretary of the investment companies for which
Fidelity Management & Research Company or an affiliate acts as investment
adviser (collectively, the "Funds"), hereby severally 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 capacity, any and all representations with respect
to the consistency of foreign language translation prospectuses with the
original prospectuses filed in connection with the Post-Effective
Amendments for the Funds 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 January 1, 1997.
WITNESS my hand on this nineteenth day of December, 1996.

/s/Arthur S. Loring
Arthur S. Loring
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. 61 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 13th day
of February 1997.
FIDELITY CHARLES STREET TRUST
By /s/Edward C. Johnson 3d (dagger)
Edward C. Johnson 3d, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
(Signature) (Title) (Date)

<TABLE>
<CAPTION>
<S> <C> <C>
/s/Edward C. Johnson 3d (dagger) President and Trustee February 13, 1997

Edward C. Johnson 3d (Principal Executive Officer)

/s/Kenneth A. Rathgeber * Treasurer February 13, 1997

Kenneth A. Rathgeber

/s/J. Gary Burkhead Trustee February 13, 1997

J. Gary Burkhead

/s/Ralph F. Cox ** Trustee February 13, 1997

Ralph F. Cox

/s/Phyllis Burke Davis ** Trustee February 13, 1997

Phyllis Burke Davis

/s/E. Bradley Jones ** Trustee February 13, 1997

E. Bradley Jones

/s/Donald J. Kirk ** Trustee February 13, 1997

Donald J. Kirk

/s/Peter S. Lynch ** Trustee February 13, 1997

Peter S. Lynch

/s/Marvin L. Mann ** Trustee February 13, 1997

Marvin L. Mann

/s/William O. McCoy ** Trustee February 13, 1997

William O. McCoy

/s/Gerald C. McDonough ** Trustee February 13, 1997

Gerald C. McDonough

/s/Thomas R. Williams ** Trustee February 13, 1997

Thomas R. Williams

</TABLE>

(dagger) Signatures affixed by J. Gary Burkhead pursuant to a power of
attorney dated January 3, 1997 and filed herewith.
* Signature affixed by John H. Costello 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 December 19, 1996 and filed herewith.

Exhibit 11
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference, into the Prospectuses
and Statements of Additional Information in Post-Effective Amendment No. 61
to the Registration Statement on Form N-1A of Fidelity Charles Street
Trust: Fidelity Asset Manager: Income, Fidelity Asset Manager, and Fidelity
Asset Manager: Growth of our reports dated November 15, 1996 on the
financial statements and financial highlights included in the September 30,
1996 Annual Reports to Shareholders of Fidelity Asset Manager: Income,
Fidelity Asset Manager, and Fidelity Asset Manager: Growth.
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectuses and "Auditor" in the Statements
of Additional Information.
/s/PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
Boston, Massachusetts
February 12, 1997