(2_FIDELITY_LOGOS)FIDELITY
INSTITUTIONAL
MONEY MARKET
FUNDS
SEMIANNUAL REPORT
SEPTEMBER 30, 1998
(FIDELIY_LOGO_GRAPHIC) Fidelity Investments (Registered Trademark)
CONTENTS
FIDELITY INSTITUTIONAL MONEY MARKET FUNDS
SCHEDULES OF INVESTMENTS & FINANCIAL STATEMENTS
TREASURY ONLY PORTFOLIO 3
TREASURY PORTFOLIO 7
GOVERNMENT PORTFOLIO 11
DOMESTIC PORTFOLIO 15
RATED MONEY MARKET PORTFOLIO 21
MONEY MARKET PORTFOLIO 26
TAX-EXEMPT PORTFOLIO 34
NOTES TO FINANCIAL STATEMENTS 49
FUND GOALS:
TREASURY ONLY PORTFOLIO, TREASURY PORTFOLIO, GOVERNMENT PORTFOLIO,
DOMESTIC PORTFOLIO, RATED MONEY MARKET PORTFOLIO, AND MONEY MARKET
PORTFOLIO SEEK TO OBTAIN AS HIGH A LEVEL OF CURRENT INCOME AS IS
CONSISTENT WITH THE PRESERVATION OF PRINCIPAL AND LIQUIDITY WITHIN THE
LIMITATIONS PRESCRIBED FOR THE FUND.
TAX-EXEMPT PORTFOLIO SEEKS AS HIGH A LEVEL OF INTEREST INCOME EXEMPT
FROM FEDERAL INCOME TAX AS IS CONSISTENT WITH A PORTFOLIO OF
HIGH-QUALITY, SHORT-TERM MUNICIPAL OBLIGATIONS SELECTED ON THE BASIS
OF LIQUIDITY AND STABILITY OF PRINCIPAL.
INVESTMENTS IN THE FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL
MAINTAIN A STABLE
$1.00 SHARE PRICE.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL INFORMATION OF THE SHAREHOLDERS OF THE
FUNDS. THIS REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUNDS
UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES
ARE NOT INSURED BY THE FDIC, FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY, AND ARE SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED. NEITHER THE
FUNDS NOR FIDELITY DISTRIBUTORS IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL THE APPROPRIATE NUMBER LISTED BELOW. READ THE
PROSPECTUS CAREFULLY BEFORE
YOU INVEST OR SEND MONEY.
RETIREMENT PLAN LEVEL ACCOUNTS
CORPORATE CLIENTS 1-800-962-1375
"NOT FOR PROFIT" CLIENTS 1-800-343-0860
FINANCIAL AND OTHER INSTITUTIONS
NATIONWIDE 1-800-843-3001
TREASURY ONLY PORTFOLIO
INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
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U.S. TREASURY OBLIGATIONS - 100.0%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
U.S. TREASURY BILLS - 19.3%
11/12/98 5.31% $ 54,077,000 $ 53,750,515
11/19/98 5.26 23,000,000 22,839,481
12/3/98 5.25 25,000,000 24,775,781
12/3/98 5.26 25,000,000 24,775,563
12/10/98 5.24 24,700,000 24,454,578
12/10/98 5.25 14,206,000 14,064,571
1/14/99 4.46 18,000,000 17,769,131
2/18/99 5.12 20,000,000 19,611,500
202,041,120
U.S. TREASURY NOTES - 62.4%
10/15/98 5.11 69,193,000 69,240,457
10/31/98 5.21 21,832,000 21,838,396
10/31/98 5.24 70,000,000 69,956,674
10/31/98 5.25 20,000,000 19,987,485
10/31/98 5.33 10,000,000 10,002,629
11/15/98 4.81 15,000,000 15,007,099
11/15/98 4.93 19,000,000 19,006,570
11/15/98 5.28 22,410,000 22,411,050
11/30/98 5.16 20,000,000 20,010,506
11/30/98 5.23 35,000,000 35,016,085
11/30/98 5.24 20,000,000 20,008,230
1/15/99 4.92 19,000,000 19,069,043
1/15/99 4.94 27,000,000 27,097,135
1/15/99 4.99 18,000,000 18,062,207
1/31/99 4.86 25,000,000 24,996,306
1/31/99 4.91 70,000,000 70,178,882
1/31/99 4.94 18,000,000 18,044,134
1/31/99 5.09 15,000,000 15,029,580
1/31/99 5.27 15,000,000 15,022,205
2/15/99 5.13 27,181,000 27,153,092
2/15/99 5.14 12,792,000 12,778,546
2/28/99 4.52 36,658,000 36,836,067
2/28/99 4.57 10,000,000 10,046,565
2/28/99 5.03 20,000,000 20,057,231
2/28/99 5.04 18,000,000 18,051,210
654,907,384
U.S. TREASURY NOTES - PRINCIPAL ONLY STRIPS - 18.3%
11/15/98 5.12 8,019,000 7,967,454
11/15/98 5.20 15,000,000 14,902,363
11/15/98 5.22 10,000,000 9,935,002
11/15/98 5.40 10,000,000 9,932,105
11/15/98 5.41 10,000,000 9,931,666
11/15/98 5.65 10,000,000 9,935,199
11/15/98 5.70 20,000,000 19,867,720
2/15/99 4.62 43,000,000 42,252,510
2/15/99 5.30 20,000,000 19,604,621
2/15/99 5.32 20,000,000 19,603,069
2/15/99 5.33 10,000,000 9,800,987
2/15/99 5.45 5,000,000 4,900,542
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
2/15/99 5.51% $ 5,000,000 $ 4,899,678
8/15/99 5.01 9,000,000 8,618,738
192,151,654
</TABLE>
TOTAL INVESTMENTS - 100% $ 1,049,100,158
Total Cost for Income Tax Purposes $ 1,049,100,158
INCOME TAX INFORMATION
At March 31, 1998, the fund had a capital loss carryforward of
approximately $225,000 of which $50,000, $115,000 and $60,000 will
expire on March 31, 2002, 2004 and 2005, respectively.
TREASURY ONLY PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
ASSETS
Investment in securities, at value - $ 1,049,100,158
See accompanying schedule
Cash 6,888
Interest receivable 10,355,116
TOTAL ASSETS 1,059,462,162
LIABILITIES
Distributions payable $ 3,169,964
Accrued management fee 135,770
Distribution fees payable 21,777
Other payables and 57,778
accrued expenses
TOTAL LIABILITIES 3,385,289
NET ASSETS $ 1,056,076,873
Net Assets consist of:
Paid in capital $ 1,056,276,902
Accumulated net realized (200,029)
gain (loss) on investments
NET ASSETS $ 1,056,076,873
CLASS I: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($924,728,516 (divided by)
924,726,315 shares)
CLASS II: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($50,764,321 (divided by)
50,764,200 shares)
CLASS III: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($80,584,036 (divided by)
80,583,845 shares)
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STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INTEREST INCOME $ 27,782,027
EXPENSES
Management fee $ 1,039,157
Transfer agent fees
Class I 127,332
Class II 6,063
Class III 12,196
Distribution fees
Class II 27,920
Class III 106,221
Accounting fees and expenses 65,261
Custodian fees and expenses 19,149
Registration fees
Class I 18,701
Class II 6,697
Class III 7,430
Audit 24,362
Legal 2,030
Miscellaneous 7,471
Total expenses before reductions 1,469,990
Expense reductions (296,660) 1,173,330
NET INTEREST INCOME 26,608,697
NET REALIZED GAIN (LOSS) 39,059
ON INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 26,647,756
</TABLE>
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STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 1998 MARCH 31,
(UNAUDITED) 1998
Operations $ 26,608,697 $ 62,171,816
Net interest income
Net realized gain (loss) 39,059 125,118
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 26,647,756 62,296,934
Distributions to shareholders from net interest income:
Class I (23,591,082) (56,460,310)
Class II (936,771) (2,554,702)
Class III (2,080,844) (3,156,804)
TOTAL DISTRIBUTIONS (26,608,697) (62,171,816)
Share transactions - net increase (decrease) at
net asset value of $1.00 per share:
Class I (17,866,942) (214,223,392)
Class II 13,915,634 (19,660,588)
Class III (19,884,200) 64,457,885
TOTAL SHARE TRANSACTIONS (23,835,508) (169,426,095)
TOTAL INCREASE (DECREASE) IN NET ASSETS (23,796,449) (169,300,977)
NET ASSETS
Beginning of period 1,079,873,322 1,249,174,299
End of period $ 1,056,076,873 $ 1,079,873,322
</TABLE>
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SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
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FINANCIAL HIGHLIGHTS - CLASS I
SIX MONTHS ENDED YEARS ENDED MARCH 31, EIGHT MONTHS YEARS ENDED JULY 31,
SEPTEMBER 30, 1998 ENDED
MARCH 31,
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994 1993
Net asset value,
beginning of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment Operations
Net interest income .026 .052 .050 .054 .033 .032 .031
Less Distributions
From net interest income (.026) (.052) (.050) (.054) (.033) (.032) (.031)
Net asset value, end of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
TOTAL RETURN B, C 2.60% 5.33% 5.17% 5.56% 3.38% 3.27% 3.10%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
(000 omitted) $924,729 $942,561 $1,156,667 $1,361,050 $1,266,285 $1,049,170 $1,047,791
Ratio of expenses to
average net assets .20% A, D .20% D .20% D .20% D .20% A, D .20% D .20% D
Ratio of net interest
income to average 5.15% A 5.20% 5.05% 5.41% 5.02% A 3.22% 3.05%
net assets
</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
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
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FINANCIAL HIGHLIGHTS - CLASS II
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 F
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .025 .051 .049 .020
Less Distributions
From net interest income (.025) (.051) (.049) (.020)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.52% 5.18% 5.01% 2.04%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 50,764 $ 36,847 $ 56,502 $ 102
Ratio of expenses to average net assets .35% A, D .35% D .35% D .35% A, D
Ratio of expenses to average net assets after expense reductions .35% A .35% .34% E .35% A
Ratio of net interest income to average net assets 5.03% A 5.05% 4.94% 5.03% A
</TABLE>
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</TABLE>
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FINANCIAL HIGHLIGHTS - CLASS III
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 G
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .024 .050 .048 .020
Less Distributions
From net interest income (.024) (.050) (.048) (.020)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.47% 5.07% 4.90% 2.00%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 80,584 $ 100,465 $ 36,006 $ 4,097
Ratio of expenses to average net assets .45% A, D .45% D .45% D .45% A, D
Ratio of net interest income to average net assets 4.90% A 4.96% 4.82% 4.89% A
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
E FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A PORTION OF THE CLASS' EXPENSES.
F FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS II SHARES) TO MARCH 31, 1996.
G FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS III SHARES) TO MARCH 31, 1996.
</TABLE>
TREASURY PORTFOLIO
INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
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U.S. TREASURY OBLIGATIONS - 13.6%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
U.S. TREASURY NOTES - 1.7%
11/30/98 5.64% $ 40,000,000 $ 39,963,123
11/30/98 5.66 40,000,000 39,961,671
6/30/99 5.42 80,000,000 80,284,500
160,209,294
U.S. TREASURY NOTES - PRINCIPAL ONLY STRIPS - 11.9%
11/15/98 5.45 41,200,000 40,921,680
11/15/98 5.65 25,000,000 24,837,999
11/15/98 5.70 25,000,000 24,834,730
2/15/99 5.46 40,000,000 39,204,484
2/15/99 5.47 80,000,000 78,410,129
2/15/99 5.50 125,000,000 122,507,660
2/15/99 5.51 80,000,000 78,394,605
2/15/99 5.53 85,000,000 83,303,035
2/15/99 5.54 50,000,000 48,998,684
5/15/99 5.49 40,000,000 38,679,598
5/15/99 5.50 208,000,000 201,131,634
5/15/99 5.51 200,000,000 193,372,369
5/15/99 5.58 40,000,000 38,651,262
8/15/99 4.74 42,000,000 40,309,064
8/15/99 4.98 25,000,000 23,945,554
8/15/99 5.00 25,000,000 23,941,117
1,101,443,604
TOTAL U.S. TREASURY OBLIGATIONS 1,261,652,898
</TABLE>
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REPURCHASE AGREEMENTS - 86.4%
MATURITY
AMOUNT
In a joint trading account (Notes 2 and 3)
(U.S. Treasury Obligations) dated:
9/18/98 due 12/16/98 At 5.29% $ 506,539,028 500,000,000
9/11/98 due 12/9/98 At 5.36% 117,537,129 116,000,000
9/10/98 due 12/9/98 At 5.37% 202,685,000 200,000,000
9/30/98 due 10/1/98 At 5.44% 201,227,409 201,197,000
8/14/98 due:
11/5/98 At 5.5% 303,804,167 300,000,000
11/9/98 At 5.5% 253,322,917 250,000,000
9/30/98 due:
10/1/98 At 5.52% 402,403,695 402,342,000
10/1/98 At 5.54% 6,055,932,384 6,055,000,000
TOTAL REPURCHASE AGREEMENTS 8,024,539,000
TOTAL INVESTMENTS - 100% $ 9,286,191,898
Total Cost for Income Tax Purposes $ 9,286,191,898
</TABLE>
INCOME TAX INFORMATION
At March 31, 1998, the fund had a capital loss carryforward of
approximately $662,000 of which $281,000 and $381,000 will expire on
March 31, 2002 and 2003, respectively. Of the loss carryforwards
expiring in 2002 and 2003, $108,000 and $14,000, respectively, was
acquired in the mergers and is available to offset future capital
gains of the fund to the extent provided by regulations.
TREASURY PORTFOLIO
FINANCIAL STATEMENTS
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STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
ASSETS
Investment in securities, at value (including repurchase agreements of $8,024,539,000) - $ 9,286,191,898
See accompanying schedule
Interest receivable 9,952,035
TOTAL ASSETS 9,296,143,933
LIABILITIES
Share transactions in process $ 13,811,438
Distributions payable 26,316,237
Accrued management fee 1,026,336
Distribution fees payable 836,132
Other payables and 569,884
accrued expenses
TOTAL LIABILITIES 42,560,027
NET ASSETS $ 9,253,583,906
Net Assets consist of:
Paid in capital $ 9,253,955,818
Accumulated net realized gain (loss) on investments (371,912)
NET ASSETS $ 9,253,583,906
CLASS I: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($4,646,488,486 (divided by)
4,646,631,783 shares)
CLASS II: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($353,833,937 (divided by)
353,844,849 shares)
CLASS III: $1.00
NET ASSET VALUE, offering price
and redemption price per share
($4,253,261,483 (divided by)
4,253,392,655 shares)
</TABLE>
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STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INTEREST INCOME $ 229,075,200
EXPENSES
Management fee $ 8,209,882
Transfer agent fees
Class I 554,049
Class II 45,057
Class III 431,349
Distribution fees
Class II 267,881
Class III 4,314,422
Accounting fees and expenses 336,939
Non-interested trustees' compensation 21,188
Custodian fees and expenses 27,585
Registration fees
Class I 164,014
Class II 19,562
Class III 124,207
Audit 36,584
Legal 18,107
Miscellaneous 9,878
Total expenses before reductions 14,580,704
Expense reductions (1,786,823) 12,793,881
NET INTEREST INCOME 216,281,319
NET REALIZED GAIN (LOSS) 346,370
ON INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 216,627,689
</TABLE>
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STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 1998 MARCH 31,
(UNAUDITED) 1998
Operations $ 216,281,319 $ 446,202,517
Net interest income
Net realized gain (loss) 346,370 198,917
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 216,627,689 446,401,434
Distributions to shareholders from net interest income:
Class I (118,175,465) (258,877,331)
Class II (9,327,650) (15,392,353)
Class III (88,778,204) (171,932,833)
TOTAL DISTRIBUTIONS (216,281,319) (446,202,517)
Share transactions - net increase (decrease)
at net asset value of $1.00 per share:
Class I 147,788,523 (1,099,986,542)
Class II (56,570,825) 320,606,447
Class III 1,254,157,242 (625,282,858)
TOTAL SHARE TRANSACTIONS 1,345,374,940 (1,404,662,953)
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,345,721,310 (1,404,464,036)
NET ASSETS
Beginning of period 7,907,862,596 9,312,326,632
End of period $ 9,253,583,906 $ 7,907,862,596
</TABLE>
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SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
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FINANCIAL HIGHLIGHTS - CLASS I
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994
Net asset value, beginning of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment Operations
Net interest income .027 .054 .052 .056 .047 .030
Less Distributions
From net interest income (.027) (.054) (.052) (.056) (.047) (.030)
Net asset value, end of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
TOTAL RETURN B, C 2.73% 5.55% 5.30% 5.79% 4.78% 3.06%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $4,646,488 $4,498,484 $5,598,330 $7,134,049 $4,688,198 $4,551,918
Ratio of expenses to average net assets .20% A, D .20% D .20% D .20% D .18% D .18% D
Ratio of net interest income to
average net assets 5.37% A 5.41% 5.17% 5.61% 4.71% 3.01%
</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
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
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FINANCIAL HIGHLIGHTS - CLASS II
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 E
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .026 .053 .050 .021
Less Distributions
From net interest income (.026) (.053) (.050) (.021)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.65% 5.40% 5.14% 2.14%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 353,834 $ 410,383 $ 89,801 $ 40,470
Ratio of expenses to average net assets .35% A, D .35% D .35% D .35% A, D
Ratio of net interest income to average net assets 5.22% A 5.25% 5.01% 5.18% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS III
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994 F
Net asset value, beginning of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment Operations
Net interest income .026 .052 .049 .054 .044 .012
Less Distributions
From net interest income (.026) (.052) (.049) (.054) (.044) (.012)
Net asset value, end of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
TOTAL RETURN B, C 2.60% 5.29% 5.03% 5.50% 4.45% 1.21%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $4,253,261 $2,998,996 $3,624,195 $1,435,302 $585,571 $5,175
Ratio of expenses to average net assets .45% A, D .45% D .45% D .46% D .50% D .50% A, D
Ratio of net interest income to
average net assets 5.14% A 5.17% 4.93% 5.28% 4.91% 2.69% A
</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
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
E FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS II SHARES)
TO MARCH 31, 1996.
F FOR THE PERIOD OCTOBER 22, 1993 (COMMENCEMENT OF SALE OF CLASS III SHARES)
TO MARCH 31, 1994.
GOVERNMENT PORTFOLIO
INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FEDERAL AGENCIES - 51.0%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
FANNIE MAE - 24.7%
Agency Coupons - 17.8%
10/1/98 5.42% (a) $ 68,000,000 $ 67,989,558
10/5/98 5.41 (a) 116,000,000 115,938,905
10/6/98 5.47 (a) 50,000,000 49,967,579
10/28/98 5.31 (a) 71,000,000 70,950,981
10/30/98 5.54 (a) 71,000,000 70,953,862
11/14/98 5.48 (a) 46,000,000 45,976,323
11/20/98 5.73 41,000,000 40,991,912
11/28/98 5.46 (a) 70,000,000 69,959,481
12/15/98 5.26 (a) 48,000,000 47,970,123
2/12/99 5.43 50,000,000 49,969,997
2/19/99 5.43 26,000,000 25,985,224
2/23/99 5.45 19,000,000 18,991,644
2/23/99 5.47 23,000,000 22,988,020
2/26/99 5.33 30,000,000 29,989,401
2/26/99 5.56 46,000,000 45,952,997
3/16/99 5.52 46,000,000 45,975,941
3/26/99 5.55 25,000,000 24,987,945
4/15/99 5.54 24,000,000 23,973,344
869,513,237
Discount Notes - 6.9%
12/15/98 5.41 55,000,000 54,389,271
12/23/98 5.32 99,538,000 98,333,175
1/15/99 5.53 25,000,000 24,603,972
2/22/99 5.30 11,000,000 10,772,080
3/15/99 5.31 45,000,000 43,933,687
6/4/99 5.33 34,000,000 32,808,130
6/14/99 5.41 35,500,000 34,189,813
8/4/99 5.44 38,941,000 37,224,145
336,254,273
FEDERAL HOME LOAN BANK - 9.7%
Agency Coupons - 9.1%
10/1/98 5.42 (a) 68,000,000 67,989,558
10/1/98 5.56 (a) 44,000,000 43,996,175
10/6/98 5.46 (a) 47,000,000 46,978,367
11/27/98 5.46 (a) 135,000,000 134,923,454
12/17/98 5.81 45,000,000 44,994,684
3/11/99 5.45 47,000,000 47,022,324
5/19/99 5.56 45,000,000 44,998,084
6/15/99 5.58 15,000,000 14,997,026
445,899,672
Discount Notes - 0.6%
1/22/99 5.53 30,000,000 29,493,383
FREDDIE MAC - 16.6%
Agency Coupons - 8.0%
10/21/98 5.38% (a) 45,000,000 44,977,404
10/22/98 5.74 15,250,000 15,248,991
10/26/98 5.33 (a) 100,000,000 99,977,786
11/27/98 5.54 (a) 50,000,000 49,935,627
3/12/99 5.52 35,000,000 35,001,553
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
4/29/99 5.62 $ 50,000,000 $ 49,959,438
8/13/99 5.52 93,000,000 92,956,554
388,057,353
Discount Notes - 8.6%
12/3/98 5.41 50,222,000 49,752,675
12/4/98 5.41 100,000,000 99,050,667
12/7/98 5.50 64,750,000 64,102,275
12/9/98 5.50 30,000,000 29,690,937
1/28/99 5.13 41,962,000 41,262,913
2/23/99 5.30 50,000,000 48,955,799
2/25/99 5.08 90,000,000 88,169,850
420,985,116
TOTAL FEDERAL AGENCIES 2,490,203,034
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
REPURCHASE AGREEMENTS - 49.0%
MATURITY
AMOUNT
In a joint trading account (Notes 2 and 3):
(U.S. Government Obligations) dated:
9/2/98 due 2/10/99 At 5.48% $ 48,151,866 47,000,000
9/3/98 due 12/2/98 At 5.5% 95,292,500 94,000,000
9/3/98 due 11/9/98 At 5.52% 69,708,860 69,000,000
9/17/98 due 10/20/98 At 5.53% 90,456,225 90,000,000
9/18/98 due 10/23/98 At 5.53% 90,483,875 90,000,000
9/2/98 due 10/6/98 At 5.55% 47,246,358 47,000,000
8/20/98 due 10/19/98 At 5.56% 93,861,800 93,000,000
8/27/98 due 10/27/98 At 5.56% 100,942,111 100,000,000
8/10/98 due 11/9/98 At 5.56% 152,108,167 150,000,000
8/11/98 due 2/8/99 At 5.57% 102,800,472 100,000,000
7/31/98 due 10/13/98 At 5.58% 47,539,090 47,000,000
8/3/98 due 1/13/99 At 5.6% 66,648,111 65,000,000
9/30/98 due 10/1/98 At 5.75% 1,363,384,853 1,363,167,000
(U.S. Treasury Obligations) dated:
9/30/98 due 10/1/98 At 5.52% 37,808,797 37,803,000
9/30/98 due 10/1/98 At 5.54% 2,833,436 2,833,000
TOTAL REPURCHASE AGREEMENTS 2,395,803,000
TOTAL INVESTMENTS - 100% $ 4,886,006,034
Total Cost for Income Tax Purposes $ 4,886,006,034
</TABLE>
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due dates on these types of
securities reflect the next interest rate reset date or, when
applicable, the final maturity date.
INCOME TAX INFORMATION
At March 31, 1998, the fund had a capital loss carryforward of
approximately $997,000 of which $240,000, $746,000 and $11,000 will
expire on March 31, 2002, 2003 and 2004, respectively. Of the loss
carryforwards expiring in 2002 and 2003, $16,000 and $1,000,
respectively, was acquired in the merger and is available to offset
future capital gains of the fund to the extent provided by
regulations.
GOVERNMENT PORTFOLIO
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
ASSETS
Investment in securities, at value (including repurchase agreements of $2,395,803,000) - $ 4,886,006,034
See accompanying schedule
Interest receivable 16,954,574
TOTAL ASSETS 4,902,960,608
LIABILITIES
Payable to custodian bank $ 13
Payable for investments purchased 129,432,763
Share transactions in process 198,329
Distributions payable 9,783,562
Accrued management fee 448,046
Distribution fees payable 143,509
Other payables and 226,360
accrued expenses
TOTAL LIABILITIES 140,232,582
NET ASSETS $ 4,762,728,026
Net Assets consist of:
Paid in capital $ 4,763,699,397
Accumulated net realized gain (loss) on investments (971,371)
NET ASSETS $ 4,762,728,026
CLASS I: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($3,987,355,903 (divided by)
3,987,637,561 shares)
CLASS II: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($180,983,665 (divided by)
181,132,103 shares)
CLASS III: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($594,388,458 (divided by)
594,348,728 shares)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INTEREST INCOME $ 129,839,043
EXPENSES
Management fee $ 4,616,226
Transfer agent fees
Class I 452,652
Class II 29,383
Class III 104,461
Distribution fees
Class II 136,351
Class III 768,272
Accounting fees and expenses 200,753
Custodian fees and expenses 35,692
Registration fees
Class I 302,022
Class II 31,705
Class III 53,618
Audit 24,162
Legal 13,444
Miscellaneous 4,659
Total expenses before reductions 6,773,400
Expense reductions (1,252,210) 5,521,190
NET INTEREST INCOME 124,317,853
NET REALIZED GAIN (LOSS) 25,843
ON INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 124,343,696
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 1998 MARCH 31,
(UNAUDITED) 1998
Operations $ 124,317,853 $ 228,606,624
Net interest income
Net realized gain (loss) 25,843 68,926
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 124,343,696 228,675,550
Distributions to shareholders from net interest income:
Class I (103,705,475) (186,389,108)
Class II (4,810,449) (6,159,594)
Class III (15,801,929) (36,057,922)
TOTAL DISTRIBUTIONS (124,317,853) (228,606,624)
Share transactions - net increase (decrease) at net asset value of $1.00 per share:
Class I 458,933,922 717,605,707
Class II 29,166,298 43,315,253
Class III (80,297,725) 15,593,566
TOTAL SHARE TRANSACTIONS 407,802,495 776,514,526
TOTAL INCREASE (DECREASE) IN NET ASSETS 407,828,338 776,583,452
NET ASSETS
Beginning of period 4,354,899,688 3,578,316,236
End of period $ 4,762,728,026 $ 4,354,899,688
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS I
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994
Net asset value, beginning of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment Operations
Net interest income .027 .055 .052 .057 .048 .031
Less Distributions
From net interest income (.027) (.055) (.052) (.057) (.048) (.031)
Net asset value, end of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
TOTAL RETURN B, C 2.75% 5.60% 5.37% 5.84% 4.86% 3.13%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $3,987,356 $3,528,366 $2,810,717 $3,064,136 $3,321,066 $3,764,544
Ratio of expenses to average net assets .20% A, D .20% D .20% D .20% D .18% D .18% D
Ratio of net interest income to
average net assets 5.43% A 5.47% 5.25% 5.69% 4.77% 3.07%
</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
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS II
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 E
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .026 .053 .051 .21
Less Distributions
From net interest income (.026) (.053) (.051) (.021)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.67% 5.45% 5.22% 2.16%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 180,984 $ 151,951 $ 108,636 $ 102
Ratio of expenses to average net assets .35% A, D .35% D .35% D .35% A, D
Ratio of net interest income to average net assets 5.29% A 5.32% 5.10% 5.33% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS III
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 F
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .026 .052 .050 .054 .045
Less Distributions
From net interest income (.026) (.052) (.050) (.054) (.045)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.62% 5.34% 5.11% 5.58% 4.57%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 594,388 $ 674,582 $ 658,964 $ 194,489 $ 40,516
Ratio of expenses to average net assets .45% A, D .45% D .45% D .45% D .43% A, D
Ratio of net interest income to average net assets 5.14% A 5.21% 5.00% 5.30% 5.13% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
E FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS II SHARES) TO MARCH 31, 1996.
F FOR THE PERIOD APRIL 4, 1994 (COMMENCEMENT OF SALE OF CLASS III SHARES) TO MARCH 31, 1995.
</TABLE>
DOMESTIC PORTFOLIO
INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CERTIFICATES OF DEPOSIT - 10.2%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
DOMESTIC CERTIFICATES OF DEPOSIT - 10.2%
Bank of America National Trust & Savings Association
3/24/99 5.34% $ 5,000,000 $ 5,000,000
BankBoston NA
10/5/98 5.63 25,000,000 25,000,000
Chase Manhattan Bank
5/10/99 5.75 5,000,000 4,998,988
Chase Manhattan Bank (USA)
3/2/99 5.50 15,000,000 15,000,000
First National Bank of Chicago
3/3/99 5.70 15,000,000 14,996,987
Mellon Bank NA, Pittsburgh
11/30/98 5.63 25,000,000 25,000,000
12/10/98 5.50 15,000,000 15,000,000
6/3/99 5.75 15,000,000 15,000,000
NationsBank NA
2/10/99 5.60 10,000,000 9,998,265
TOTAL CERTIFICATES OF DEPOSIT 129,994,240
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
COMMERCIAL PAPER - 47.9%
Associates Corp. of North America
10/19/98 5.59 10,000,000 9,972,450
10/20/98 5.54 5,000,000 4,985,460
10/20/98 5.59 10,000,000 9,970,919
2/17/99 5.59 25,000,000 24,474,889
CIESCO L.P.
10/27/98 5.32 11,000,000 10,957,894
CIT Group, Inc.
10/13/98 5.62 15,000,000 14,972,400
12/7/98 5.59 15,000,000 14,846,458
12/24/98 5.55 25,000,000 24,682,083
Citibank Credit Card Master Trust I (Dakota Certificate Program)
10/5/98 5.58 5,000,000 4,996,917
10/28/98 5.58 5,000,000 4,979,300
12/9/98 5.50 5,000,000 4,947,963
CoreStates Capital Corp.
10/15/98 5.54 (b) 10,000,000 10,000,000
Delaware Funding Corp.
10/19/98 5.56 24,522,000 24,454,197
du Pont (E.I.) de Nemours & Co.
11/19/98 5.53 50,000,000 49,628,417
Enterprise Funding Corp.
10/20/98 5.58 6,513,000 6,494,025
10/21/98 5.58 10,000,000 9,969,222
Fleet Funding Corp.
10/21/98 5.58 12,877,000 12,837,439
10/28/98 5.54 5,000,000 4,979,375
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
Ford Motor Credit Co.
10/20/98 5.53% $ 5,000,000 $ 4,985,486
12/3/98 5.52 25,000,000 24,762,000
2/1/99 5.61 5,000,000 4,906,725
General Electric Capital Corp.
12/17/98 5.49 3,000,000 2,965,286
2/1/99 5.62 5,000,000 4,906,554
General Electric Capital Services, Inc.
11/3/98 5.59 10,000,000 9,949,400
11/23/98 5.58 25,000,000 24,797,569
General Motors Acceptance Corp.
10/29/98 5.61 10,000,000 9,957,067
11/6/98 5.44 25,000,000 24,865,000
11/12/98 5.62 10,000,000 9,935,600
1/26/99 5.67 10,000,000 9,821,250
Goldman Sachs Group L.P. (The)
10/14/98 5.56 20,000,000 19,959,989
JC Penney Funding Corp.
11/30/98 5.51 5,000,000 4,954,583
Kitty Hawk Funding Corp.
10/23/98 5.57 9,420,000 9,388,166
Merrill Lynch & Co., Inc.
10/14/98 5.65 20,000,000 19,960,133
11/30/98 5.66 20,000,000 19,816,667
Monsanto Co.
2/11/99 5.42 9,000,000 8,823,775
3/10/99 5.39 10,000,000 9,766,667
Morgan (JP) & Co., Inc.
2/22/99 5.37 27,000,000 26,433,000
Morgan Stanley, Dean Witter, Discover & Co.
10/15/98 5.54 (b) 10,000,000 10,000,000
10/21/98 5.57 10,000,000 9,969,278
10/27/98 5.56 20,000,000 19,920,122
National Rural Utility Coop. Finance Corp.
12/11/98 5.22 15,000,000 14,847,054
New Center Asset Trust
10/26/98 5.56 10,000,000 9,961,597
Principal Mutual Life Insurance Co.
10/23/98 5.54 25,000,000 24,915,819
Salomon Smith Barney
12/3/98 5.52 5,000,000 4,952,313
Southern Co. Group
11/24/98 5.52 5,000,000 4,958,975
Three Rivers Funding Corp.
10/14/98 5.59 11,274,000 11,251,324
TOTAL COMMERCIAL PAPER 609,880,807
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FEDERAL AGENCIES - 2.0%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
FEDERAL HOME LOAN BANK - 2.0%
Agency Coupons - 2.0%
3/11/99 5.45% $ 25,000,000 $ 25,011,874
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
BANK NOTES - 21.8%
BankBoston NA
10/5/98 5.60 25,000,000 25,000,000
CoreStates Bank NA, Philadelphia
10/5/98 5.57 (b) 20,000,000 20,000,000
10/14/98 5.59 (b) 10,000,000 10,000,000
First National Bank of Chicago
2/16/99 5.70 18,000,000 17,987,558
First Union National Bank of North Carolina
10/1/98 5.65 (b) 12,000,000 11,999,271
11/4/98 5.60 5,000,000 5,000,000
Harris Trust & Savings Bank
12/4/98 5.37 50,000,000 50,003,899
Key Bank NA
10/1/98 5.62 (b) 7,000,000 6,998,853
LaSalle National Bank, Chicago
10/14/98 5.60 15,000,000 15,000,000
10/19/98 5.62 10,000,000 10,000,000
12/2/98 5.21 10,000,000 10,000,000
12/16/98 5.42 15,000,000 15,000,000
National City Bank, Kentucky
10/5/98 5.52 (b) 10,000,000 9,997,959
NationsBank NA
10/19/98 5.54 20,000,000 20,000,000
12/22/98 5.54 15,000,000 15,008,548
3/17/99 5.30 15,000,000 15,000,000
PNC Bank NA, Pittsburgh
10/19/98 5.58 (b) 15,000,000 14,997,398
Wachovia Bank NA
11/13/98 5.49 5,000,000 4,997,960
TOTAL BANK NOTES 276,991,446
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
MASTER NOTES - 6.1%
Goldman Sachs Group L.P. (The)
11/4/98 5.69 (b) 7,000,000 7,000,000
12/8/98 5.56 (b)(c) 40,000,000 40,000,000
J.P. Morgan Securities, Inc.
10/2/98 5.62 (b) 26,000,000 26,000,000
SunTrust Banks, Inc.
10/1/98 5.33 (b) 5,000,000 5,000,000
TOTAL MASTER NOTES 78,000,000
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
MEDIUM-TERM NOTES - 2.7%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
Merrill Lynch & Co., Inc.
10/1/98 5.56% (b) $ 5,000,000 $ 4,999,995
Morgan Guaranty Trust Co., NY
10/27/98 5.54 (b) 5,000,000 4,997,600
Morgan Stanley, Dean Witter, Discover & Co.
10/1/98 5.75 (b) 15,000,000 15,000,000
Norwest Corp.
10/22/98 5.71 (b) 9,000,000 9,000,000
TOTAL MEDIUM-TERM NOTES 33,997,595
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
SHORT-TERM NOTES - 6.1%
Capital One Funding Corp. (1995-D)
10/7/98 5.61 (b) 2,792,000 2,792,000
Capital One Funding Corp. (1996-G)
10/7/98 5.61 (b) 3,971,000 3,971,000
Capital One Funding Corp. (1997-D)
10/7/98 5.61 (b) 3,600,000 3,600,000
Capital One Funding Corp. (1997-G)
10/7/98 5.61 (b) 7,900,000 7,900,000
New York Life Insurance Co.
10/1/98 5.68 (b) 15,000,000 15,000,000
Pacific Life Insurance Co.
12/9/98 5.63 (a)(b) 3,000,000 3,000,000
Peoples Security Life Insurance Co.
10/1/98 5.73 (b)(c) 5,000,000 5,000,000
SMM Trust (1997-P)
10/16/98 5.58 (a)(b) 2,000,000 2,000,000
SMM Trust (1997-X)
10/13/98 5.63 (a)(b) 7,000,000 7,000,000
Strategic Money Market Trust (1997-A)
12/16/98 5.50 (a)(b) 15,000,000 15,000,000
Strategic Money Market Trust (1998-B)
10/5/98 5.63 (a)(b) 9,000,000 9,000,000
Transamerica Life Insurance & Annuity Co.
10/7/98 5.52 (b) 3,000,000 3,000,000
TOTAL SHORT-TERM NOTES 77,263,000
REPURCHASE AGREEMENTS - 3.2%
MATURITY
AMOUNT
In a joint trading account $ 41,374,343 41,368,000
(U.S. Treasury Obligations)
dated 9/30/98 due 10/1/98
At 5.52%
TOTAL INVESTMENTS - 100% $ 1,272,506,962
Total Cost for Income Tax Purposes $ 1,272,506,962
</TABLE>
LEGEND
(a) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$36,000,000 or 2.8% of net assets.
(b) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due dates on these types of
securities reflect the next interest rate reset date or, when
applicable, the final maturity date.
(c) Restricted securities - Investment in securities not registered
under the Securities Act of 1933 (see Note 2 of Notes to Financial
Statements).
SECURITY ACQUISITION ACQUISITION
DATE COST
Goldman Sachs Group L.P. (The) 5.56% 12/8/98 3/10/98 $ 40,000,000
Peoples Security Life Insurance Co. 5.73% 10/1/98 9/17/98 $ 5,000,000
OTHER INFORMATION
At the end of the period, restricted securities (excluding 144A
issues) amounted to $45,000,000 or 3.5% of net assets (see Note 2 of
Notes to Financial Statements).
INCOME TAX INFORMATION
At March 31, 1998, the fund had a capital loss carryforward of
approximately $126,000 of which $44,000, $49,000, $32,000 and $1,000
will expire on March 31, 2001, 2003, 2005 and 2006, respectively.
DOMESTIC PORTFOLIO
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
ASSETS
Investment in securities, at value (including repurchase agreements of $41,368,000) - $ 1,272,506,962
See accompanying schedule
Interest receivable 7,772,284
TOTAL ASSETS 1,280,279,246
LIABILITIES
Payable to custodian bank $ 217,959
Distributions payable 1,960,114
Accrued management fee 162,927
Distribution fees payable 27,975
Other payables and accrued expenses 64,347
TOTAL LIABILITIES 2,433,322
NET ASSETS $ 1,277,845,924
Net Assets consist of:
Paid in capital $ 1,277,940,382
Accumulated net realized gain (loss) on investments (94,458)
NET ASSETS $ 1,277,845,924
CLASS I: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($1,125,705,732 (divided by)
1,125,775,175 shares)
CLASS II: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($46,461,834 (divided by)
46,464,700 shares)
CLASS III: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($105,678,358 (divided by)
105,684,877 shares)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INTEREST INCOME $ 34,980,021
EXPENSES
Management fee $ 1,242,387
Transfer agent fees
Class I 117,498
Class II 6,489
Class III 15,524
Distribution fees
Class II 26,857
Class III 119,423
Accounting fees and expenses 72,972
Custodian fees and expenses 15,592
Registration fees
Class I 25,431
Class II 7,898
Class III 11,629
Audit 16,107
Legal 3,714
Miscellaneous 5,704
Total expenses before reductions 1,687,225
Expense reductions (298,538) 1,388,687
NET INTEREST INCOME 33,591,334
NET REALIZED GAIN (LOSS) 34,682
ON INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 33,626,016
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 1998 MARCH 31,
(UNAUDITED) 1998
Operations $ 33,591,334 $ 68,146,835
Net interest income
Net realized gain (loss) 34,682 (4,895)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 33,626,016 68,141,940
Distributions to shareholders from net interest income:
Class I (30,141,422) (63,098,581)
Class II (959,728) (579,325)
Class III (2,490,184) (4,468,929)
TOTAL DISTRIBUTIONS (33,591,334) (68,146,835)
Share transactions - net increase (decrease) at net asset value of $1.00 per share:
Class I (45,161,907) 251,287,735
Class II 12,006,473 30,222,382
Class III 32,380,719 (48,417,851)
TOTAL SHARE TRANSACTIONS (774,715) 233,092,266
TOTAL INCREASE (DECREASE) IN NET ASSETS (740,033) 233,087,371
NET ASSETS
Beginning of period 1,278,585,957 1,045,498,586
End of period $ 1,277,845,924 $ 1,278,585,957
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS I
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994
Net asset value, beginning of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment Operations
Net interest income .027 .055 .053 .057 .049 .031
Less Distributions
From net interest income (.027) (.055) (.053) (.057) (.049) (.031)
Net asset value, end of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
TOTAL RETURN B, C 2.77% 5.64% 5.40% 5.85% 4.97% 3.14%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $1,125,706 $1,170,833 $919,554 $1,117,917 $771,937 $656,976
Ratio of expenses to average net assets .20% A, D .20% D .20% D .20% D .18% D .18% D
Ratio of net interest income to
average net assets 5.43% A 5.50% 5.26% 5.66% 4.94% 3.09%
</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
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS II
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 E
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .027 .054 .051 .021
Less Distributions
From net interest income (.027) (.054) (.051) (.021)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.69% 5.49% 5.24% 2.15%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 46,462 $ 34,455 $ 4,235 $ 2,105
Ratio of expenses to average net assets .35% A, D .35% D .35% D .35% A, D
Ratio of net interest income to average net assets 5.36% A 5.36% 5.10% 5.20% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS III
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 F
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .026 .053 .050 .054 .035
Less Distributions
From net interest income (.026) (.053) (.050) (.054) (.035)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.64% 5.38% 5.13% 5.56% 3.51%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 105,678 $ 73,298 $ 121,709 $ 47,396 $ 26,545
Ratio of expenses to average net assets .45% A, D .45% D .45% D .47% D .50% A, D
Ratio of net interest income to average net assets 5.21% A 5.26% 5.02% 5.40% 5.14% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
E FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS II SHARES) TO MARCH 31, 1996.
F FOR THE PERIOD JULLY 19, 1994 (COMMENCEMENT OF SALE OF CLASS III SHARES) TO MARCH 31, 1995.
</TABLE>
RATED MONEY MARKET PORTFOLIO
INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CERTIFICATES OF DEPOSIT - 21.0%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
CHICAGO BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 0.9%
ABN-AMRO Bank NV
2/2/99 5.54% $ 5,000,000 $ 4,999,334
DOMESTIC CERTIFICATES OF DEPOSIT - 1.8%
Bank of America National Trust & Savings Association
3/24/99 5.34 10,000,000 10,000,000
LONDON BRANCH, EURODOLLAR, FOREIGN BANKS - 6.7%
Abbey National Treasury Services PLC
10/6/98 5.61 5,000,000 5,000,000
12/3/98 5.50 20,000,000 20,000,000
12/10/98 5.50 4,000,000 4,000,077
Barclays Bank PLC
10/5/98 5.63 4,000,000 4,000,009
Halifax PLC
10/23/98 5.58 5,000,000 5,000,000
38,000,086
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 11.6%
Bank of Nova Scotia
2/25/99 5.76 10,000,000 9,990,109
5/28/99 5.75 5,000,000 4,999,386
Canadian Imperial Bank of Commerce
11/4/98 5.55 5,000,000 5,000,000
12/1/98 5.54 5,000,000 5,000,000
Dresdner Bank AG
10/19/98 5.52 10,000,000 10,000,000
Norddeutsche Landesbank Girozentrale
6/7/99 5.76 5,000,000 4,997,713
RaboBank Nederland Coop. Central
2/2/99 5.70 6,000,000 5,993,814
Royal Bank of Canada
2/10/99 5.60 5,000,000 4,998,786
Societe Generale, France
10/28/98 5.57 5,000,000 5,000,000
11/18/98 5.63 5,000,000 5,000,327
Swiss Bank Corp.
3/24/99 5.75 5,000,000 4,997,675
65,977,810
TOTAL CERTIFICATES OF DEPOSIT 118,977,230
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
COMMERCIAL PAPER - 44.8%
Aspen Funding Corp.
10/19/98 5.58 5,000,000 4,986,125
11/23/98 5.60 5,000,000 4,959,403
Associates Corp. of North America
10/28/98 5.55 5,000,000 4,979,338
Bradford & Bingley Building Society
12/14/98 5.46 9,105,000 9,004,122
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
Caisse des Depots et Consignations
10/15/98 5.55% $ 15,000,000 $ 14,967,800
CIESCO L.P.
10/26/98 5.32 5,000,000 4,981,597
CIT Group, Inc.
12/7/98 5.59 10,000,000 9,897,639
Citibank Credit Card Master Trust I (Dakota Certificate Program)
10/21/98 5.58 5,000,000 4,984,583
Cregem North America, Inc.
12/3/98 5.51 5,000,000 4,952,488
12/14/98 5.42 10,000,000 9,890,028
Deutsche Bank Financial, Inc.
11/12/98 5.59 25,000,000 24,839,289
Diageo Capital PLC
12/11/98 5.44 15,000,000 14,841,138
du Pont (E.I.) de Nemours & Co.
10/27/98 5.33 5,000,000 4,980,861
12/3/98 5.46 12,000,000 11,886,810
Fleet Funding Corp.
10/21/98 5.58 10,000,000 9,969,278
Ford Motor Credit Co.
2/1/99 5.61 5,000,000 4,906,725
General Electric Capital Corp.
10/8/98 5.63 5,000,000 4,994,643
10/20/98 5.62 5,000,000 4,985,486
12/16/98 5.49 9,000,000 8,897,210
2/17/99 5.60 10,000,000 9,789,569
General Electric Capital Services, Inc.
10/14/98 5.60 15,000,000 14,969,992
11/3/98 5.59 5,000,000 4,974,700
General Motors Acceptance Corp.
10/21/98 5.55 10,000,000 9,969,333
10/29/98 5.61 5,000,000 4,978,533
11/12/98 5.62 5,000,000 4,967,800
1/26/99 5.67 5,000,000 4,910,625
JC Penney Funding Corp.
12/14/98 5.47 5,000,000 4,944,603
Merrill Lynch & Co., Inc.
11/30/98 5.66 10,000,000 9,908,333
Morgan Stanley, Dean Witter, Discover & Co.
10/21/98 5.57 5,000,000 4,984,639
New Center Asset Trust
10/26/98 5.56 5,000,000 4,980,799
Southern Co. Group
11/24/98 5.52 5,000,000 4,958,975
Svenska Handelsbanken, Inc.
12/9/98 5.44 5,410,000 5,354,318
TOTAL COMMERCIAL PAPER 253,596,782
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
BANK NOTES - 2.7%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
First Union National Bank of North Carolina
10/1/98 5.65% (b) $ 5,000,000 $ 4,999,696
3/15/99 5.50 5,000,000 5,000,000
NationsBank NA
3/17/99 5.30 5,000,000 5,000,000
TOTAL BANK NOTES 14,999,696
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
MASTER NOTES - 1.4%
Goldman Sachs Group L.P. (The)
11/4/98 5.69 (b) 3,000,000 3,000,000
12/8/98 5.56 (b)(c) 5,000,000 5,000,000
TOTAL MASTER NOTES 8,000,000
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
MEDIUM-TERM NOTES - 4.9%
CIT Group Holdings, Inc.
10/15/98 5.81 (b) 15,000,000 15,005,596
Merrill Lynch & Co., Inc.
10/1/98 5.56 (b) 3,000,000 2,999,997
Morgan Guaranty Trust Co., NY
10/27/98 5.54 (b) 5,000,000 4,997,600
Morgan Stanley, Dean Witter, Discover & Co.
10/1/98 5.75 (b) 5,000,000 5,000,000
TOTAL MEDIUM-TERM NOTES 28,003,193
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
SHORT-TERM NOTES - 6.3%
Capital One Funding Corp. (1994-B)
10/7/98 5.61 (b) 3,799,000 3,799,000
Capital One Funding Corp. (1994-E)
10/7/98 5.61 (b) 1,609,000 1,609,000
Liquid Asset Backed Securities Trust (1997-5)
10/19/98 5.56 (a)(b) 4,000,000 4,000,000
Peoples Security Life Insurance Co.
10/1/98 5.73 (b)(c) 5,000,000 5,000,000
SMM Trust (1997-P)
10/16/98 5.58 (a)(b) 2,000,000 2,000,000
SMM Trust (1997-X)
10/13/98 5.63 (a)(b) 6,000,000 6,000,000
Strategic Money Market Trust (1997-A)
12/16/98 5.50 (a)(b) 10,000,000 10,000,000
Strategic Money Market Trust (1998-B)
10/5/98 5.63 (a)(b) 3,000,000 3,000,000
TOTAL SHORT-TERM NOTES 35,408,000
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
REPURCHASE AGREEMENTS - 18.9%
MATURITY VALUE
AMOUNT (NOTE 1)
In a joint trading account $ 107,028,409 $ 107,012,000
(U.S. Treasury Obligations) dated 9/30/98 due 10/1/98 (Cost $107,012,000)
At 5.52%
TOTAL INVESTMENTS - 100% $ 565,996,901
Total Cost for Income Tax Purposes $ 565,996,901
</TABLE>
LEGEND
(a) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$25,000,000 or 4.4% of net assets.
(b) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due dates on these types of
securities reflect the next interest rate reset date or, when
applicable, the final maturity date.
(c) Restricted securities - Investment in securities not registered
under the Securities Act of 1933 (see Note 2 of Notes to Financial
Statements).
SECURITY ACQUISITION ACQUISITION
DATE COST
Goldman Sachs Group L.P. (The) 5.56% 12/8/98 3/10/98 $ 5,000,000
Peoples Security Life Insurance Co. 5.73% 10/1/98 9/17/98 $ 5,000,000
INCOME TAX INFORMATION
At March 31, 1998, the fund had a capital loss carryforward of
approximately $29,000 of which $5,000, $10,000 and $14,000 will expire
on March 31, 2004, 2005 and 2006, respectively.
RATED MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
ASSETS
Investment in securities, at value (including
repurchase agreements of $107,012,000) - See accompanying $ 565,996,901
schedule
Interest receivable 2,519,087
TOTAL ASSETS 568,515,988
LIABILITIES
Share transactions in process $ 99,914
Distributions payable 157,754
Accrued management fee 59,512
Distribution fees payable 44,273
Other payables and accrued expenses 84,220
TOTAL LIABILITIES 445,673
NET ASSETS $ 568,070,315
Net Assets consist of:
Paid in capital $ 568,072,260
Accumulated net realized gain (loss) on investments (1,945)
NET ASSETS $ 568,070,315
CLASS I: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($277,644,957 (divided by)
277,679,410 shares)
CLASS II: $1.00
NET ASSET VALUE, offering price and
redemption price per
share ($124,540,407 (divided by)
124,555,864 shares)
CLASS III: $1.00
NET ASSET VALUE, offering price
and redemption price per
share ($165,884,951 (divided by)
165,905,538 shares)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INTEREST INCOME $ 14,204,979
EXPENSES
Management fee $ 502,165
Transfer agent fees
Class I 66,397
Class II 1,557
Class III 6,172
Distribution fees
Class II 48,652
Class III 151,665
Accounting fees and expenses 43,682
Custodian fees and expenses 4,695
Registration fees
Class I 44,353
Class II 23,765
Class III 21,562
Audit 26,048
Legal 887
Total expenses before reductions 941,600
Expense reductions (239,010) 702,590
NET INTEREST INCOME 13,502,389
NET REALIZED GAIN (LOSS) 29,439
ON INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 13,531,828
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 1998 MARCH 31,
(UNAUDITED) 1998
Operations $ 13,502,389 $ 21,644,389
Net interest income
Net realized gain (loss) 29,439 (15,808)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 13,531,828 21,628,581
Distributions to shareholders from net interest income:
Class I (8,612,383) (17,673,446)
Class II (1,720,985) (1,512,439)
Class III (3,169,021) (2,458,504)
TOTAL DISTRIBUTIONS (13,502,389) (21,644,389)
Share transactions - net increase (decrease) at net asset value of $1.00 per share:
Class I (26,222,115) (9,066,939)
Class II 101,228,669 9,157,642
Class III 90,506,654 58,744,207
TOTAL SHARE TRANSACTIONS 165,513,208 58,834,910
TOTAL INCREASE (DECREASE) IN NET ASSETS 165,542,647 58,819,102
NET ASSETS
Beginning of period 402,527,668 343,708,566
End of period $ 568,070,315 $ 402,527,668
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS I
SIX MONTHS ENDED YEARS ENDED MARCH 31, SEVEN MONTHS YEARS ENDED AUGUST 31,
SEPTEMBER 30, 1998 ENDED
MARCH 31,
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994 1993
Net asset value,
beginning of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment
Operations
Net interest income .027 .055 .053 .032 .054 .033 .029
Less Distributions
From net interest income (.027) (.055) (.053) (.032) (.054) (.033) (.029)
Net asset value,
end of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
TOTAL RETURN B, C 2.76% 5.64% 5.39% 3.21% 5.53% 3.34% 2.93%
RATIOS AND SUPPLEMENTAL DATA
Net assets,
end of period (000 omitted) $277,645 $303,826 $312,892 $223,772 $300,863 $399,333 $611,410
Ratio of expenses to
average net assets .20% A, D .20% D .20% D .27% A, D .42% .42% .42%
Ratio of net interest
income to average net assets 5.45% A 5.49% 5.26% 5.46% A 5.33% 3.24% 2.89%
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS II
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 E
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .027 .053 .051 .021
Less Distributions
From net interest income (.027) (.053) (.051) (.021)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.69% 5.48% 5.23% 2.15%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 124,540 $ 23,321 $ 14,166 $ 4,709
Ratio of expenses to average net assets .35% A, D .35% D .35% D .35% A, D
Ratio of net interest income to average net assets 5.31% A 5.37% 5.14% 5.06% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS III
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 F
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
Net interest income .026 .052 .050 .021
Less Distributions
From net interest income (.026) (.052) (.050) (.021)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.64% 5.38% 5.12% 2.11%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 165,885 $ 75,380 $ 16,651 $ 1,610
Ratio of expenses to average net assets .45% A, D .45% D .45% D .45% A, D
Ratio of net interest income to average net assets 5.22% A 5.29% 5.03% 5.01% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
E FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS II SHARES) TO MARCH 31, 1996.
F FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS III SHARES) TO MARCH 31, 1996.
</TABLE>
MONEY MARKET PORTFOLIO
INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CERTIFICATES OF DEPOSIT - 34.6%
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
CHICAGO BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 0.4%
ABN-AMRO Bank NV
2/2/99 5.54% $ 45,000,000 $ 44,994,005
DOMESTIC CERTIFICATES OF DEPOSIT - 0.1%
CoreStates Bank NA, Philadelphia
10/9/98 5.57 (b) 10,000,000 10,000,000
LONDON BRANCH, EURODOLLAR, DOMESTIC BANKS - 0.6%
NationsBank NA
3/2/99 5.50 65,000,000 65,000,000
LONDON BRANCH, EURODOLLAR, FOREIGN BANKS - 16.0%
Abbey National Treasury Services PLC
10/6/98 5.61 50,000,000 50,000,000
12/4/98 5.50 150,000,000 150,002,630
12/10/98 5.50 105,000,000 105,002,014
12/23/98 5.62 50,000,000 50,000,000
12/28/98 5.43 80,000,000 80,000,000
Bank of Scotland
11/9/98 5.57 100,000,000 100,001,583
Bank of Scotland Treasury Services
10/9/98 5.58 50,000,000 49,999,986
Barclays Bank PLC
10/21/98 5.60 20,000,000 20,000,000
10/28/98 5.65 38,000,000 37,998,997
12/15/98 5.50 100,000,000 100,013,983
12/29/98 5.64 100,000,000 100,000,000
Bayerische Hypo-und Vereinsbank AG
10/5/98 5.57 25,000,000 25,000,003
Bayerische Landesbank Girozentrale
10/5/98 5.61 50,000,000 50,000,054
Dresdner Bank AG
12/1/98 5.19 100,000,000 100,000,000
Halifax PLC
10/23/98 5.58 70,000,000 70,000,000
11/30/98 5.24 100,000,000 100,000,000
12/1/98 5.19 150,000,000 150,000,000
1/15/99 5.60 100,000,000 100,008,122
RaboBank Nederland Coop. Central
10/5/98 5.60 29,000,000 29,000,000
12/1/98 5.18 50,000,000 50,000,000
Societe Generale, France
11/2/98 5.29 15,000,000 15,000,133
Svenska Handelsbanken
12/1/98 5.19 40,000,000 40,000,000
12/17/98 5.41 40,000,000 40,000,000
Toronto-Dominion Bank
10/14/98 5.93 25,000,000 25,000,000
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
Westdeutsche Landesbank Girozentrale
10/20/98 5.58% $ 50,000,000 $ 50,000,000
1/19/99 5.40 75,000,000 74,999,818
1,762,027,323
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 17.5%
ABN-AMRO Bank NV
6/7/99 5.76 50,000,000 49,980,401
Bank of Scotland Treasury Services
10/14/98 5.58 17,400,000 17,399,871
Bayerische Hypo-und Vereinsbank AG
11/10/98 5.50 50,000,000 50,000,000
12/10/98 5.47 75,000,000 75,000,000
Canadian Imperial Bank of Commerce
11/4/98 5.55 85,000,000 85,000,000
12/1/98 5.54 65,000,000 65,000,000
3/2/99 5.70 40,000,000 39,989,622
Credit Agricole Indosuez
10/19/98 5.97 15,000,000 14,999,505
10/21/98 5.62 35,000,000 35,000,000
10/21/98 6.00 30,000,000 29,999,214
12/2/98 5.48 100,000,000 100,000,000
2/26/99 5.70 25,000,000 24,996,113
Credit Communale de Belgique
11/2/98 5.50 20,000,000 20,000,000
12/21/98 5.62 25,000,000 25,000,000
Deutsche Bank AG
12/2/98 5.19 40,000,000 40,000,000
3/2/99 5.70 45,000,000 44,991,019
Dresdner Bank AG
10/19/98 5.52 80,000,000 80,000,000
10/19/98 5.53 45,000,000 45,000,000
12/9/98 5.41 90,000,000 90,007,539
2/16/99 5.34 75,000,000 75,000,000
National Westminster Bank PLC
12/4/98 5.51 25,000,000 25,000,000
2/26/99 5.70 44,000,000 43,993,160
3/2/99 5.70 45,000,000 44,991,019
6/7/99 5.75 50,000,000 49,977,949
RaboBank Nederland Coop. Central
12/1/98 5.18 100,000,000 100,000,000
2/2/99 5.54 45,000,000 44,994,005
5/5/99 5.83 35,000,000 34,988,103
6/1/99 5.75 50,000,000 49,977,676
Royal Bank of Canada
2/10/99 5.60 45,000,000 44,989,071
Societe Generale, France
10/28/98 5.57 135,000,000 135,000,000
11/18/98 5.63 35,000,000 35,002,290
CERTIFICATES OF DEPOSIT - CONTINUED
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - CONTINUED
Swiss Bank Corp.
3/24/99 5.75% $ 30,000,000 $ 29,986,047
6/3/99 5.75 100,000,000 99,954,985
6/11/99 5.80 50,000,000 49,980,088
Toronto-Dominion Bank
6/4/99 5.76 73,000,000 72,962,295
Westdeutsche Landesbank Girozentrale
10/13/98 5.55 50,000,000 50,000,000
1,919,159,972
TOTAL CERTIFICATES OF DEPOSIT 3,801,181,300
COMMERCIAL PAPER - 34.6%
ABN-AMRO North America, Inc.
10/5/98 5.61 50,000,000 49,969,722
AC Acquisition Holding Co.
10/1/98 5.75 19,692,000 19,692,000
Aspen Funding Corp.
10/15/98 5.58 50,000,000 49,892,472
11/23/98 5.60 35,000,000 34,715,824
Asset Securitization Coop. Corp.
12/8/98 5.59 30,000,000 29,688,333
12/9/98 5.59 30,000,000 29,683,750
Associates Corp. of North America
10/21/98 5.59 15,000,000 14,954,083
Bank of Nova Scotia
10/2/98 5.55 90,000,000 89,986,200
BBV Finance, Inc.
10/5/98 5.62 28,360,000 28,342,669
Caisse des Depots et Consignations
11/12/98 5.57 140,000,000 139,103,300
Chrysler Financial Corp.
10/21/98 5.55 50,000,000 49,846,667
CIT Group, Inc.
10/27/98 5.27 15,000,000 14,943,125
Citibank Credit Card Master Trust I (Dakota Certificate Program)
10/1/98 5.78 7,445,000 7,445,000
10/6/98 5.58 35,000,000 34,973,021
10/21/98 5.60 25,000,000 24,923,194
10/27/98 5.59 20,000,000 19,920,122
11/19/98 5.60 10,000,000 9,924,867
12/9/98 5.50 35,000,000 34,635,738
12/10/98 5.49 10,000,000 9,894,611
Commercial Credit Group, Inc.
10/14/98 5.60 15,000,000 14,970,019
12/3/98 5.52 25,000,000 24,762,000
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
Cregem North America, Inc.
11/3/98 5.57% $ 60,000,000 $ 59,697,500
12/3/98 5.51 65,000,000 64,382,338
Delaware Funding Corp.
10/7/98 5.57 100,000,000 99,907,500
10/20/98 5.59 11,066,000 11,033,469
10/29/98 5.32 82,680,000 82,339,175
11/17/98 5.53 20,000,000 19,856,911
Den Danske Corp., Inc.
11/30/98 5.62 55,500,000 54,994,025
Deutsche Bank Financial, Inc.
10/16/98 5.57 200,000,000 199,540,000
11/13/98 5.59 50,000,000 49,670,931
du Pont (E.I.) de Nemours & Co.
11/5/98 5.28 25,000,000 24,872,396
Enterprise Funding Corp.
10/14/98 5.59 20,000,000 19,960,061
10/16/98 5.59 20,183,000 20,136,411
10/20/98 5.58 20,000,000 19,941,733
Finova Capital Corp.
11/3/98 5.63 15,000,000 14,923,688
Fleet Funding Corp.
10/19/98 5.56 20,000,000 19,944,700
10/23/98 5.56 30,000,000 29,898,800
10/28/98 5.54 30,000,000 29,876,250
Ford Motor Credit Co.
10/5/98 5.57 50,000,000 49,969,333
10/6/98 5.57 100,000,000 99,923,333
10/7/98 5.58 50,000,000 49,954,167
10/20/98 5.53 45,000,000 44,869,375
11/10/98 5.57 70,000,000 69,573,000
General Electric Capital Corp.
10/20/98 5.62 50,000,000 49,854,861
10/26/98 5.59 35,000,000 34,865,833
10/27/98 5.59 100,000,000 99,601,333
12/14/98 5.49 45,000,000 44,499,575
General Motors Acceptance Corp.
10/29/98 5.61 100,000,000 99,570,667
11/6/98 5.44 30,000,000 29,838,000
11/12/98 5.62 50,000,000 49,678,000
1/26/99 5.67 50,000,000 49,106,250
General Motors Corp.
10/15/98 5.56 50,000,000 49,892,278
GTE Corp.
10/6/98 5.59 32,000,000 31,975,289
10/26/98 5.40 17,000,000 16,936,486
10/27/98 5.38 20,124,000 20,046,098
10/27/98 5.39 25,000,000 24,903,042
10/27/98 5.40 12,000,000 11,953,373
COMMERCIAL PAPER - CONTINUED
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
Heller Financial, Inc.
10/21/98 5.68 $ 10,000,000 $ 9,968,611
10/30/98 5.67% 15,000,000 14,931,850
Kitty Hawk Funding Corp.
10/7/98 5.58 10,000,000 9,990,767
10/20/98 5.58 59,762,000 59,587,578
10/23/98 5.57 40,000,000 39,864,822
Lehman Brothers Holdings, Inc.
10/15/98 5.60 15,000,000 14,967,654
10/15/98 5.61 35,000,000 34,924,458
10/26/98 5.61 15,000,000 14,942,240
11/5/98 5.60 35,000,000 34,811,146
Merrill Lynch & Co., Inc.
11/18/98 5.60 20,000,000 19,853,067
11/30/98 5.65 30,000,000 29,724,000
Morgan Stanley, Dean Witter, Discover & Co.
10/8/98 5.60 45,000,000 44,951,700
10/15/98 5.54 (b) 35,000,000 35,000,000
10/21/98 5.57 75,000,000 74,769,583
National Australia Funding, Inc.
2/22/99 5.35 40,000,000 39,163,200
NationsBank Corp.
11/16/98 5.60 15,000,000 14,894,392
Nationwide Building Society
10/22/98 5.60 50,000,000 49,838,708
10/27/98 5.62 35,000,000 34,860,719
12/10/98 5.42 15,000,000 14,843,958
Preferred Receivables Funding Corp.
10/1/98 5.60 14,400,000 14,400,000
10/6/98 5.58 79,075,000 79,014,156
10/13/98 5.57 35,000,000 34,935,483
10/13/98 5.58 15,000,000 14,972,350
10/20/98 5.58 45,585,000 45,451,955
10/22/98 5.59 34,130,000 34,020,300
11/2/98 5.54 10,000,000 9,951,111
Salomon Smith Barney
10/19/98 5.58 20,000,000 19,944,600
11/3/98 5.60 20,000,000 19,898,617
12/2/98 5.52 40,000,000 39,624,556
Sears Roebuck Acceptance Corp.
10/14/98 5.59 10,000,000 9,979,994
12/8/98 5.27 30,000,000 29,704,767
2/25/99 5.55 20,000,000 19,559,000
Societe Generale North America, Inc.
2/25/99 5.34 45,000,000 44,040,825
Transamerica Finance Corp.
10/27/98 5.29 35,000,000 34,866,786
Triple A One Funding Corp.
10/7/98 5.59 20,000,000 19,981,517
10/14/98 5.57 25,000,000 24,949,896
10/14/98 5.59 40,000,000 39,919,833
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
10/15/98 5.58 $ 21,877,000 $ 21,829,952
11/9/98 5.53% 29,687,000 29,510,437
UBS Finance (Delaware), Inc.
12/31/98 5.52 100,000,000 98,629,944
Unifunding, Inc.
12/16/98 5.65 20,000,000 19,768,200
Westpac Capital Corp.
10/5/98 5.61 20,000,000 19,987,778
TOTAL COMMERCIAL PAPER 3,797,083,408
FEDERAL AGENCIES - 3.7%
FANNIE MAE - 0.5%
Discount Notes - 0.5%
12/23/98 5.31 50,000,000 49,395,944
FREDDIE MAC - 3.2%
Discount Notes - 3.2%
12/22/98 5.30 61,540,000 60,806,888
12/23/98 5.25 97,000,000 95,841,551
2/22/99 5.30 150,000,000 146,892,000
2/23/99 5.30 50,000,000 48,956,806
352,497,245
TOTAL FEDERAL AGENCIES 401,893,189
BANK NOTES - 6.2%
Abbey National Treasury Services PLC
11/17/98 5.54 (a)(b) 59,000,000 58,954,998
CoreStates Bank NA, Philadelphia
10/14/98 5.59 (b) 10,000,000 10,000,000
First Union National Bank of North Carolina
10/1/98 5.50 (b) 93,000,000 93,000,000
10/1/98 5.54 (b) 58,000,000 57,996,476
3/15/99 5.50 140,000,000 140,000,000
Key Bank NA
10/1/98 5.51 (b) 25,000,000 24,995,903
10/21/98 5.47 (b) 45,000,000 44,972,908
LaSalle National Bank, Chicago
12/2/98 5.21 30,000,000 30,000,000
National City Bank, Kentucky
10/5/98 5.52 (b) 40,000,000 39,991,834
NationsBank NA
10/19/98 5.54 50,000,000 50,000,000
PNC Bank NA, Pittsburgh
10/1/98 5.22 (b) 50,000,000 49,970,082
10/1/98 5.22 (b) 10,000,000 9,994,016
10/19/98 5.58 (b) 75,000,000 74,986,988
TOTAL BANK NOTES 684,863,205
MASTER NOTES - 3.4%
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
Goldman Sachs Group L.P. (The)
11/4/98 5.69% (b) $ 27,000,000 $ 27,000,000
12/8/98 5.56 (b)(c) 170,000,000 170,000,000
J.P. Morgan Securities, Inc.
10/2/98 5.62 (b) 50,000,000 50,000,000
10/7/98 5.60 (b) 105,000,000 105,000,000
SunTrust Banks, Inc.
10/1/98 5.33 (b) 20,000,000 20,000,000
TOTAL MASTER NOTES 372,000,000
MEDIUM-TERM NOTES - 3.0%
General Electric Capital Corp.
12/9/98 5.54 (b) 15,000,000 15,000,000
Merrill Lynch & Co., Inc.
10/1/98 6.26 (b) 42,000,000 41,999,955
12/4/98 5.52 (b) 35,000,000 34,995,372
Morgan Guaranty Trust Co., NY
10/27/98 5.54 (b) 60,000,000 59,971,200
Morgan Stanley, Dean Witter, Discover & Co.
10/1/98 5.62 (b) 60,000,000 60,000,000
Norwest Corp.
10/22/98 5.71 (b) 61,000,000 61,000,000
Premier Auto Trust
6/8/99 5.41 56,000,000 55,991,610
TOTAL MEDIUM-TERM NOTES 328,958,137
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
SHORT-TERM NOTES - 7.8%
Capital One Funding. Corp. (1994-C)
10/7/98 5.33 (b) 7,220,000 7,220,000
Capital One Funding. Corp. (1995-E)
10/7/98 5.33 (b) 6,830,000 6,830,000
Capital One Funding. Corp. (1996-C)
10/7/98 5.33 (b) 13,289,000 13,289,000
Capital One Funding Corp. (1996-H)
10/7/98 5.35 (b) 4,000,000 4,000,000
Capital One Funding Corp. (1997-E)
10/7/98 5.33 (b) 12,900,000 12,900,000
Capital One Funding Corp. (1997-F)
10/7/98 5.33 (b) 2,700,000 2,700,000
Capital One Funding Corp. (1998-B)
10/7/98 5.33 (b) 30,368,000 30,368,000
Liquid Asset Backed Securities Trust (1996-1)
10/15/98 5.57 (a)(b) 33,000,000 33,000,000
Liquid Asset Backed Securities Trust (1997-5)
10/19/98 5.56 (a)(b) 106,000,000 106,000,000
New York Life Insurance Co.
10/1/98 5.29 (b) 55,000,000 55,000,000
10/7/98 5.64 (b) 37,000,000 37,000,000
DUE DATE ANNUALIZED YIELD AT PRINCIPAL VALUE
TIME OF PURCHASE AMOUNT (NOTE 1)
Pacific Life Insurance Co.
12/9/98 5.63% (a)(b) $ 37,000,000 $ 37,000,000
Peoples Security Life Insurance Co.
10/1/98 5.73 (b)(c) 36,000,000 36,000,000
SMM Trust (1997-P)
10/16/98 5.58 (a)(b) 45,000,000 45,000,000
SMM Trust (1997-X)
10/13/98 5.63 (a)(b) 120,000,000 120,000,000
SMM Trust (1998-I)
10/28/98 5.53 (a)(b) 24,000,000 24,000,000
Strategic Money Market Trust (1997-A)
12/16/98 5.50 (a)(b) 163,000,000 163,000,000
Strategic Money Market Trust (1998-B)
10/5/98 5.63 (a)(b) 97,000,000 97,000,000
Transamerica Life Insurance & Annuity Co.
10/7/98 5.52 (b) 25,000,000 25,000,000
TOTAL SHORT-TERM NOTES 855,307,000
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
TIME DEPOSITS - 3.6%
Deutsche Bank AG
10/1/98 5.88 200,000,000 200,000,001
RaboBank Nederland Coop. Central
10/1/98 6.00 200,000,000 200,000,000
TOTAL TIME DEPOSITS 400,000,001
REPURCHASE AGREEMENTS - 3.1%
MATURITY
AMOUNT
In a joint trading account
(U.S. Treasury Obligations)
dated 9/30/98 due:
10/1/98 At 5.44% $ 8,804,330 8,803,000
10/1/98 At 5.53% 332,416,074 332,365,000
TOTAL REPURCHASE AGREEMENTS 341,168,000
TOTAL INVESTMENTS - 100% $ 10,982,454,240
Total Cost for Income Tax Purposes $ 10,982,454,240
</TABLE>
LEGEND
(a) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$683,954,998 or 6.5% of net assets.
(b) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due dates on these types of
securities reflect the next interest rate reset date or, when
applicable, the final maturity date.
(c) Restricted securities - Investment in securities not registered
under the Securities Act of 1933 (see Note 2 of Notes to Financial
Statements).
SECURITY ACQUISITION ACQUISITION
DATE COST
Goldman Sachs Group L.P. (The) 3/10/98 $ 170,000,000
5.56% 12/8/98
Peoples Security Life Insurance Co. 7/31/98 - 9/17/98 $ 36,000,000
5.73% 10/1/98
OTHER INFORMATION
At the end of the period, restricted securities (excluding 144A
issues) amounted to $206,000,000 or 1.9% of net assets (see Note 2 of
Notes to Financial Statements).
INCOME TAX INFORMATION
At March 31, 1998, the fund had a capital loss carryforward of
approximately $2,220,000 of which $336,000, $898,000, $547,000,
$245,000, $14,000 and $180,000 will expire on March 31, 2001, 2002,
2003, 2004, 2005 and 2006, respectively.
MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
ASSETS
INVESTMENT IN SECURITIES, AT VALUE (INCLUDING REPURCHASE AGREEMENTS OF $341,168,000) - $ 10,982,454,240
SEE ACCOMPANYING SCHEDULE
RECEIVABLE FOR INVESTMENTS SOLD 57,782,000
INTEREST RECEIVABLE 56,759,111
OTHER RECEIVABLES 6,043
TOTAL ASSETS 11,097,001,394
LIABILITIES
PAYABLE TO CUSTODIAN BANK $ 798,538
PAYABLE FOR INVESTMENTS PURCHASED 480,000,000
SHARE TRANSACTIONS IN PROCESS 3,892,845
DISTRIBUTIONS PAYABLE 15,117,748
ACCRUED MANAGEMENT FEE 1,323,488
DISTRIBUTION FEES PAYABLE 136,322
OTHER PAYABLES AND ACCRUED EXPENSES 573,020
TOTAL LIABILITIES 501,841,961
NET ASSETS $ 10,595,159,433
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 10,597,537,483
ACCUMULATED NET REALIZED GAIN (LOSS) ON INVESTMENTS (2,378,050)
NET ASSETS $ 10,595,159,433
CLASS I: $1.00
NET ASSET VALUE, OFFERING PRICE
AND REDEMPTION PRICE PER
SHARE ($9,872,674,851 (DIVIDED BY)
9,874,868,689 SHARES)
CLASS II: $1.00
NET ASSET VALUE, OFFERING PRICE
AND REDEMPTION PRICE PER
SHARE ($245,546,505 (DIVIDED BY)
245,601,068 SHARES)
CLASS III: $1.00
NET ASSET VALUE, OFFERING PRICE
AND REDEMPTION PRICE PER
SHARE ($476,938,077 (DIVIDED BY)
477,044,060 SHARES)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INTEREST INCOME $ 316,790,193
EXPENSES
MANAGEMENT FEE $ 11,042,484
TRANSFER AGENT FEES
CLASS I 1,191,245
CLASS II 22,472
CLASS III 69,441
DISTRIBUTION FEES
CLASS II 109,367
CLASS III 656,579
ACCOUNTING FEES AND EXPENSES 406,393
NON-INTERESTED TRUSTEES' COMPENSATION 4,802
CUSTODIAN FEES AND EXPENSES 94,683
REGISTRATION FEES
CLASS I 218,323
CLASS II 18,149
CLASS III 31,604
AUDIT 28,340
LEGAL 40,043
MISCELLANEOUS 16,681
TOTAL EXPENSES BEFORE REDUCTIONS 13,950,606
EXPENSE REDUCTIONS (3,084,431) 10,866,175
NET INTEREST INCOME 305,924,018
NET REALIZED GAIN (LOSS) (104,227)
ON INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 305,819,791
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 1998 MARCH 31,
(UNAUDITED) 1998
OPERATIONS $ 305,924,018 $ 558,571,783
NET INTEREST INCOME
NET REALIZED GAIN (LOSS) (104,227) (234,733)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 305,819,791 558,337,050
DISTRIBUTIONS TO SHAREHOLDERS FROM NET INTEREST INCOME:
CLASS I (288,234,996) (522,359,446)
CLASS II (3,912,983) (5,229,363)
CLASS III (13,776,039) (30,982,974)
TOTAL DISTRIBUTIONS (305,924,018) (558,571,783)
SHARE TRANSACTIONS - NET INCREASE (DECREASE) AT NET ASSET VALUE OF $1.00 PER SHARE:
CLASS I 488,752,336 670,095,958
CLASS II 159,591,569 (81,609,613)
CLASS III (10,874,532) 43,774,250
TOTAL SHARE TRANSACTIONS 637,469,373 632,260,595
TOTAL INCREASE (DECREASE) IN NET ASSETS 637,365,146 632,025,862
NET ASSETS
BEGINNING OF PERIOD 9,957,794,287 9,325,768,425
END OF PERIOD $ 10,595,159,433 $ 9,957,794,287
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS I
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
INCOME FROM INVESTMENT OPERATIONS
NET INTEREST INCOME .027 .055 .053 .057 .049 .032
LESS DISTRIBUTIONS
FROM NET INTEREST INCOME (.027) (.055) (.053) (.057) (.049) (.032)
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.78% 5.68% 5.43% 5.90% 4.99% 3.20%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD
(000 OMITTED) $ 9,872,675 $ 9,383,996 $ 8,714,137 $ 6,465,953 $ 5,130,123 $ 3,200,277
RATIO OF EXPENSES TO
AVERAGE NET ASSETS .18% A, D .18% D .18% D .18% D .18% D .18% D
RATIO OF NET INTEREST INCOME
TO AVERAGE NET ASSETS 5.46% A 5.54% 5.31% 5.73% 5.00% 3.15%
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS II
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 E
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
INCOME FROM INVESTMENT OPERATIONS
NET INTEREST INCOME .027 .054 .051 .022
LESS DISTRIBUTIONS
FROM NET INTEREST INCOME (.027) (.054) (.051) (.022)
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.70% 5.52% 5.27% 2.17%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD (000 OMITTED) $ 245,547 $ 85,990 $ 167,583 $ 64,200
RATIO OF EXPENSES TO AVERAGE NET ASSETS .33% A, D .33% D .33% D .33% A, D
RATIO OF NET INTEREST INCOME TO AVERAGE NET ASSETS 5.37% A 5.39% 5.16% 5.29% A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS III
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994 F
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
INCOME FROM INVESTMENT OPERATIONS
NET INTEREST INCOME .026 .053 .050 .055 .046 .011
LESS DISTRIBUTIONS
FROM NET INTEREST INCOME (.026) (.053) (.050) (.055) (.046) (.011)
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 2.65% 5.41% 5.17% 5.61% 4.66% 1.08%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD (000 OMITTED) $476,938 $487,808 $444,048 $229,530 $457,286 $89,463
RATIO OF EXPENSES TO AVERAGE NET ASSETS .43% A,D .43%D .43%D .45%D .50%D .50%A,D
RATIO OF NET INTEREST INCOME TO AVERAGE NET ASSETS 5.25% A 5.28% 5.06% 5.46% 4.94% 2.83%A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
E FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS II SHARES) TO MARCH 31, 1996.
F FOR THE PERIOD NOVEMBER 17, 1993 (COMMENCEMENT OF SALE OF CLASS III SHARES) TO MARCH 31, 1994.
</TABLE>
TAX-EXEMPT PORTFOLIO
INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
MUNICIPAL SECURITIES (A) - 100.0%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
ALABAMA - 2.2%
Alabama Hsg. Fin. Auth. Multi-Family Hsg. Rev. (Homewood Gardens
Proj.)
Series 1991 C, 4.10%, LOC SouthTrust Bank, NA, Alabama, VRDN $
2,045,000 $ 2,045,000 010306FX
Anniston Ind. Dev. Board (Monsanto Co. Proj.) Series 1992, 3.65%, VRDN
9,100,000 9,100,000 036040AG
Anniston Solid Waste Disp. Auth. (Monsanto Co. Proj.) Series 1992,
3.65%, VRDN 2,230,000 2,230,000 036060AB
Birmingham Pub. Park & Recreation Board Rev. (McWane Ctr. Proj.)
Series 1997,
4%, LOC AmSouth Bank, Birmingham, Alabama, VRDN 9,200,000 9,200,000
091078BL
Columbia Ind. Dev. Board Participating VRDN, Series 1997 I, 4.12%
(Liquidity Facility Caisse des Depots et Consignations) (b)
2,180,000 2,180,000 197210AR
Decatur Ind. Dev. Board (Monsanto Co. Proj.) Series 1990, 3.65%, VRDN
5,925,000 5,925,000 242852AJ
Decatur Poll. Cont. Rev. Rfdg. (Monsanto Co. Proj.) VRDN:
Series 1992, 3.65% 3,500,000 3,500,000 242852AK
Series 1994, 3.65% 3,115,000 3,115,000 242852AQ
Huntsville Ind. Dev. Board Rev. Rfdg. (PPG Inds., Inc. Proj.) Series
1992, 4%, VRDN 1,000,000 1,000,000 447078FC
Jefferson County Swr. Participating VRDN, Series PT-124,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 3,800,000
3,800,000 472682FF
Port City Med. Clinic (Mobile - Infirmary Health Sys.) Series B, 4.05%
(AMBAC Insured)
(Liquidity Facility RaboBank Nederland Coop. Central) VRDN 3,700,000
3,700,000 733808AB
Tarrant City Ind. Dev. Board Rev. Rfdg. (Philip Morris Co., Inc.)
Series 1993, 4.20%, VRDN 2,300,000 2,300,000 876306BT
Tuscaloosa County Port Auth. Rev. (Capstone Hotel Ltd. Proj.) Series
1989 A, 4%,
LOC SouthTrust Bank, NA, Alabama, VRDN 4,025,000 4,025,000
900595AA
52,120,000
ALASKA - 0.3%
Alaska Hsg. Fin. Corp. Participating VRDN, Series FR/RI-23, 3.80%
(Liquidity Facility Bank of New York, NA) (b) 3,010,000 3,010,000
011831X9
Valdez Marine Term. Rev. Rfdg. Bonds (Atlantic Richfield Co.)
Series 1994 A, 3.35% 3/5/99, CP mode 4,075,000 4,075,000 918991HA
7,085,000
ARIZONA - 2.9%
Maricopa County Poll. Cont. Rev. (Arizona Pub. Svc. Co. - Palo Verde
Proj.)
Series C, 4.15%, LOC Toronto-Dominion Bank, VRDN 1,000,000
1,000,000 566854AX
Mesa Ind. Dev. Auth. Participating VRDN, Series 1997 B, 4.12%
(Liquidity Facility Caisse des Depots et Consignations) (b)
6,445,000 6,445,000 590504BR
Mesa Muni. Dev. Corp. Bonds:
Series 1985, 3.45% 10/19/98, LOC Westdeutsche
Landesbank Girozentrale, CP mode 2,300,000 2,300,000 5905169T
Series 1996 A & B, 3.85% 10/6/98, LOC Westdeutsche
Landesbank Girozentrale, CP mode 5,000,000 5,000,000 5905169N
Phoenix Ind. Dev. Auth. Multi-Family Hsg. Rev., VRDN:
Rfdg. (Paradise Lakes Apt. Proj.) Series 1995,
3.80%, LOC General Electric Capital Corp. 18,000,000 18,000,000
718903HA
(Paradise Shadows II Apts. Proj.) Series 1989,
3.70%, LOC Citibank, NY, NA 1,875,000 1,875,000 718903FM
Pinal County Ind. Dev. Auth. Hosp. Rev. (Casa Grande Med. Ctr. Proj.)
Series 1995, 3.80%, LOC Chase Manhattan Bank, VRDN 10,500,000
10,500,000 72204PAA
Salt River Proj. Agricultural Impt. & Pwr. Dist., CP:
3.60% 10/14/98 (Liquidity Facility Bank of America
Nat'l. Trust & Savings, NA, Bank One, Arizona, NA) 20,000,000
20,000,000 795998KV
3.40% 12/7/98 (Liquidity Facility Bank of America
Nat'l. Trust & Savings, NA, Bank One, Arizona, NA) 5,000,000
5,000,000 795998LE
70,120,000
ARKANSAS - 1.8%
Arkansas Hosp. Equip. Fin. Auth. Rev. (Jefferson Hosp. Assoc., Inc.
Proj.) Series 1989,
3.70%, LOC KBC Bank, NV, VRDN 3,660,000 3,660,000 040866AG
North Little Rock Baptist Health Series 1996-B, 4% (MBIA Insured)
(BPA Credit Suisse First Boston (BK)) VRDN 16,600,000 16,600,000
660551AA
University of Arkansas Rev. (UAMS Campus) Series 1998, 3.65%
(MBIA Insured) (BPA Credit Suisse First Boston (BK)) VRDN 23,495,000
23,495,000 914084FP
43,755,000
CALIFORNIA - 0.3%
Long Beach Gen. Oblig. TRAN Series 1998-1999, 4% 10/5/99 6,500,000
6,552,780 542399EA
COLORADO - 1.6%
Colorado Springs Util. Sys. Participating VRDN, Series FR/RI-19,
3.85% (Liquidity Facility Bank of New York, NA) (b) 2,100,000
2,100,000 196630H7
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
COLORADO - CONTINUED
Denver City & County Dept. of Aviation Participating VRDN (b):
Series FR/RI-13, 3.80% (Liquidity Facility Bank of New York, NA) $
9,500,000 $ 9,500,000 249181VZ
Series 1997 Q, 3.75% (Liquidity Facility First Union Nat'l. Bank
(NC)) 2,900,000 2,900,000 249181SU
Series PA-165, 4.14% (Liquidity Facility Merrill Lynch & Co., Inc.)
17,980,000 17,980,000 249181SU
Moffat County Poll. Cont. Rev. Rfdg. (Colorado-UTE Elec. Assoc., Inc.)
Series 1984,
3.65% (AMBAC Insured) (BPA Societe Generale, France) VRDN 1,100,000
1,100,000 607874BQ
Poudre School Dist. Larimer County TAN Series R-1, 3.30% 6/30/99
4,000,000 517138RA 4,000,280 517138RA
37,580,280
DELAWARE - 0.9%
Delaware Econ. Dev. Auth. (Peninsula United Methodist Homes, Inc.)
VRDN:
Series 1992 B, 4.05%, LOC PNC Bank, NA 4,845,000 4,845,000
246387DL
Series 1997 B, 4.05%, LOC PNC Bank, NA 6,100,000 6,100,000
246387GX
Delaware Econ. Dev. Auth. Poll. Cont. Rev. Rfdg.
(Philip Morris Co., Inc. Proj.) Series 1992, 4.10%, VRDN 3,300,000
3,300,000 246387BU
Delaware Hsg. Auth. Participating VRDN, Series PA-39,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 7,100,000
7,100,000 246394M5
21,345,000
DISTRICT OF COLUMBIA - 0.1%
Dist. of Columbia Wtr. & Swr. Participating VRDN, Series 1998-5201,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 3,300,000 269897CL
3,300,000 269897CL
FLORIDA - 11.1%
Broward County Hsg. Fin. Auth. Multi-Family Hsg. Rev. (Palm
Aire-Oxford Proj.)
Series 1990, 3.70% (Continental Casualty Co. Guaranteed) VRDN
1,620,000 1,620,000 115027CU
Florida Cap. Proj. Fin. Auth. Rev., VRDN:
(Cap. Proj. Loan Prog.) Series 1997 A, 3.97% (FSA Insured) (BPA Credit
Suisse First Boston (BK)) 23,500,000 23,500,000 140423AA
(Florida Hosp. Assoc. Proj.) Series 1998 A, 3.60% (FSA Insured)
(Liquidity Facility Credit Suisse First Boston (BK)) 16,600,000
16,600,000 140423AB
Florida Dept. of Envir. Protection Participating VRDN, Series
FR/RI-A18,
3.80% (Liquidity Facility Nat'l. Westminster Bank, PLC) (b)
2,180,000 2,180,000 342812H7
Florida Hsg. Fin. Agcy. Multi-Family Hsg. Rev. Rfdg. (Brandon-Oxford
Proj.)
Series 1990 C, 3.70% (Continental Casualty Co. Guaranteed) VRDN
1,500,000 1,500,000 3407375T
Highlands County Health Fac. Auth. Rev. (Adventist Health Sys./Sunbelt
Proj.) VRDN:
Series 1996 A, 4.05%, LOC SunTrust Bank, Central Florida, NA
5,010,000 5,010,000 431022DL
Series B, 4.05% (MBIA Insured) (Liquidity Facility Canadian Imperial
Bank of Commerce) 13,000,000 13,000,000 431022DK
4.05% (MBIA Insured) (BPA First Nat'l. Bank, Chicago, Illinois)
6,800,000 6,800,000 431022DJ
4.05%, LOC SunTrust Bank, Central Florida, NA 22,400,000
22,400,000 431022DM
Indian River County Hosp. Dist. Hosp. Rev. Bonds:
Series 1988, 3.35% 2/18/99, LOC Kredietbank, NV, CP mode 1,650,000
1,650,000 45499CJH
Series 1989, 3.35% 2/18/99, LOC Kredietbank, NV, CP mode 1,000,000
1,000,000 45499CJJ
Series 1990, 3.35% 2/18/99, LOC Kredietbank, NV, CP mode 4,300,000
4,300,000 45499CJK
Jacksonville Elec. Auth., CP:
Series A, 3.45% 11/13/98 (Liquidity Facility Morgan Guaranty Trust
Co., NY) 3,000,000 3,000,000 46999BCK
Series A, 3.35% 2/5/99 (Liquidity Facility Morgan Guaranty Trust Co.,
NY) 15,200,000 15,200,000 46999BCP
Series C-1, 3.40% 2/17/99 (Liquidity Facility Morgan Guaranty Trust
Co., NY) 2,200,000 2,200,000 46999BCQ
Jacksonville Health Facs. Rev. (Faculty Practice Assoc.) 4.05%, LOC
NationsBank, NA, VRDN 1,900,000 1,900,000 469402EH
Lakeland Elec. & Wtr. Participating VRDN, Series 960901, 4.12%
(Liquidity Facility Citibank, NY, NA) (b) 6,600,000 6,600,000
469402EH
Lee County Hosp. Board Hosp. Rev. Bonds (Lee Mem. Hosp. Proj.):
Series 1995 A, 3.60% 11/13/98 (Liquidity Facility SunTrust Bank,
Central Florida, NA) CP mode 2,500,000 2,500,000 523995KK
Series 1997 B, 3.70% 10/7/98 (Liquidity Facility SunTrust Bank,
Central Florida, NA) CP mode 5,400,000 5,400,000 523995KF
Series 1997 B, 3.70% 10/9/98 (Liquidity Facility SunTrust Bank,
Central Florida, NA) CP mode 3,800,000 3,800,000 523995KG
Miami Hsg. Fin. Auth. (Miami Jewish Home and Hosp. for the Aged Proj.)
Series 1992, 4.05%, LOC SunTrust Bank, Miami, NA, VRDN (b) 2,000,000
2,000,000 593416AT
Orange County Health Facs. Auth. Rev. (SHCC Svcs., Inc. Proj.) Series
1992,
4%, LOC SunTrust Bank, Miami, NA, VRDN 6,340,000 6,340,000
684503RN
Orange County Ind. Dev. Auth. (Central Florida YMCA Proj.) Series
1997,
4.05%, LOC SunTrust Bank, Central Florida, NA, VRDN 5,625,000
5,625,000 684901CR
Reedy Creek Impt. Dist. Participating VRDN, Series 96C0904,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 9,900,000 9,900,000
269896WY
Sarasota County Pub. Hosp. Dist. Rev. Bonds (Sarasota Mem. Hosp.):
Series 1991, 3.80% 11/19/98, CP mode 4,500,000 4,500,000 8039965U
Series 1991, 3.65% 12/10/98, CP mode 17,900,000 17,900,000
8039966S
Series 1993 A, 3.65% 12/10/98, CP mode 25,300,000 25,300,000
8039966T
Series A, 3.35% 2/26/99 (Liquidity Facility SunTrust Bank, Central
Florida, NA) CP mode 4,400,000 4,400,000 8039966W
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
FLORIDA - CONTINUED
Sunshine State Gov't. Fing. Commission Rev.:
Series 1994 A, CP:
3.60% 10/16/98 (Liquidity Facility Bank of Nova Scotia) $ 4,400,000
$ 4,400,000 867992NM
3.40% 12/7/98 (Liquidity Facility Bank of Nova Scotia) 7,500,000
7,500,000 867992PA
3.45% 2/17/99 (Liquidity Facility Bank of Nova Scotia) 5,880,000
5,880,000 867992PF
Series 1986, 3.35% 2/2/99 (Liquidity Facility Toronto-Dominion Bank,
United Bank of Switzerland, AG) (AMBAC Insured) CP mode 15,190,000
15,190,000 867992PD
Tampa Occupational License Series 1996 A, 3.50% (FGIC Insured)
(BPA FGIC Security Purchase, Inc.) VRDN 10,000,000 10,000,000
875198AA
Volusia Hsg. Fin. Auth. Multi-Family Hsg. Rev. (Arbors Apts.) Series
1997 A,
4%, LOC Republic Nat'l. Bank, NY, VRDN 1,550,000 1,550,000
928904EM
West Orange Mem. Hosp. Tax District Rev. Bonds Series 1991-A1, 3.35%
2/1/99,
LOC RaboBank Nederland Coop. Central, CP mode 3,500,000 3,500,000
95499DBG
264,145,000
GEORGIA - 4.2%
Albany Dougherty County Hosp. Auth. (Phoebe Puttnay Hosp.) Series
1996,
3.65% (AMBAC Insured) (BPA SunTrust Bank, Atlanta) VRDN 5,700,000
5,700,000 012170DF
Brooks County Dev. Auth. Rev. (Presbyterian Home, Inc. Proj.) 4.05%,
LOC SunTrust Bank, Atlanta, VRDN 2,600,000 2,600,000 11436PAA
Burke County Dev. Auth. Bonds (Oglethorpe Pwr. Corp. Vogtle Proj.)
Series 1998 B,
3.35% 2/26/99 (AMBAC Insured) (BPA RaboBank Nederland Coop. Central)
CP mode 5,000,000 5,000,000 121994AU
Columbia County Residential Care Facs. Rev. (Augusta Residential Ctr./
Brandon Wilde Lifecare Ctr.) 4.05%, LOC SunTrust Bank, Atlanta, VRDN
3,395,000 3,395,000 197478AA
Dekalb County Dev. Auth. Rev. (BDS Oglethorpe Univ. Proj.)
4.05%, LOC SunTrust Bank, Atlanta, VRDN 2,805,000 2,805,000
240463FE
Fulton County Dev. Auth. Rev. (Robert W. Woodruff Arts Ctr.)
Series 1996, 4.05%, LOC SunTrust Bank, Atlanta, VRDN 3,000,000
3,000,000 359900DR
Fulton County Hsg. Auth. Multi-Family Hsg. Rev. Rfdg., VRDN:
(Holcomb's Landing Apts. Proj.) 3.65%, LOC First Union Nat'l. Bank
(NC) 2,300,000 2,300,000 360055BJ
(Spring Creek Crossing Proj.) 3.65%, LOC Wachovia Bank, NA
13,000,000 13,000,000 360055BJ
Gwinnett County Dev. Auth. Rev. (Greater Atlanta Schools Proj.) Series
1998,
4.05%, LOC SunTrust Bank, Atlanta, VRDN 6,500,000 6,500,000
403720AH
Macon-Bibb County Hosp. Auth. Rev. (Med. Ctr. of Central Georgia)
VRDN:
Series 1997 A, 4.05%, LOC SunTrust Bank, Atlanta 2,000,000
2,000,000 55553RBS
4.05%, LOC SunTrust Bank, Atlanta 1,550,000 1,550,000 55553RBR
Marietta Hsg. Auth. Multi-Family Hsg. Rev. Rfdg. (Wood Pointe Apts.)
Series 1993,
3.65%, LOC First Union Nat'l. Bank (NC) VRDN 2,000,000 2,000,000
567663EF
Metropolitan Atlanta Rapid Trans. Auth. Participating VRDN, Series
PT-1064,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 17,000,000
17,000,000 591745WW
Georgia Muni. Elec. Auth. (Gen. Resolution Proj.):
Bonds:
Series 1985 A, 3.60% 10/13/98, LOC Bayersiche Landesbank
Girozentrale, Credit Suisse First Boston Bank (BK) CP mode
4,200,000 4,200,000 625997FL
Series 1985 B, 3.60% 10/13/98, LOC Bayerische Landesbank
Girozentrale, Credit Suisse First Boston Bank (BK) CP mode
3,500,000 3,500,000 625997FK
Series A, 3.60% 10/15/98, LOC Bayerische Landesbank
Girozentrale, Morgan Guaranty Trust Co., NY, CP 5,655,000
5,655,000 625997FJ
Richmond County Board of Ed. Participating VRDN, Series 1997 C,
4.12% (Liquidity Caisse des Depots et Consignations) (b) 2,000,000
2,000,000 764581HE
Roswell Hsg. Auth. Multi-Family Hsg. Rev. (Autumnbrook Apts.) Series
1991 A,
4.05%, LOC AmSouth Bank, Birmingham, Alabama, VRDN 5,200,000
5,200,000 778542AM
Savannah Econ. Dev. Auth. Poll. Cont. Rev. Rfdg. (American Cyanamid
Co. Proj.)
Series 1998, 3.50% (American Home Products Corp. Guaranteed) VRDN
13,200,000 13,200,000 80483BAW
100,605,000
IDAHO - 0.3%
Caribou County Poll. Cont. Rev. Rfdg. (Monsanto Co. Proj.) VRDN:
Series 1990, 3.65% 3,600,000 3,600,000 142076AD
Series 1994 A, 3.65% 3,000,000 3,000,000 142076AE
Series 1994 B, 3.65% 1,000,000 1,000,000 142076AF
7,600,000
ILLINOIS - 7.6%
Chicago Gen. Oblig. Participating VRDN, Series PT-1031, 4.14%
(Liquidity Facility Merrill Lynch & Co., Inc.) (b) 42,300,000
42,300,000 167484JS
Chicago School Reform Board Participating VRDN, Series 96-BB, 4.12%
(Liquidity Facility Bank of America Nat'l. Trust & Savings, NA) (b)
9,000,000 9,000,000 167501RC
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
ILLINOIS - CONTINUED
Chicago Tax Increment Allocation Rev. (Stockyards Southeast Quad)
Series 1996 B, 3.65%, LOC Northern Trust Co., Chicago, VRDN $
11,700,000 $ 11,700,000 167709AH
Chicago Water Participating VRDN, Series PT-129, 4.14%
(Liquidity Facility Merrill Lynch & Co., Inc.) (b) 8,000,000
8,000,000 167736PF
Glendale Heights Participating VRDN 4.19%
(Liquidity Facility Merrill Lynch & Co., Inc.) (b) 1,330,000
1,330,000 378905AQ
Illinois Dev. Fin. Auth. (Glenwood School for Boys) Series 1998,
3.65%, LOC Harris Trust & Savings Bank, Chicago, VRDN 13,100,000
13,100,000 4519083X
Illinois Ed. Fin. Auth. Participating VRDN, Series 96C1303,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 9,900,000 9,900,000
269896YG
Illinois Edl. Facs. Auth. Rev.:
Participating VRDN, Series 1997 U, 3.75% (Liquidity Facility First
Union Nat'l. Bank (NC)) (b) 4,250,000 4,250,000 452001WK
(Art Institute of Chicago) Series 1996, 3.70% (Liquidity Facility
Bank of America Nat'l. Trust & Savings, NA) VRDN 7,400,000
7,400,000 452001QT
Illinois Health Facs. Auth.:
Rev.:
Rfdg. (Franciscan Eldercare Commty. Svc.) Series 1996 C, 3.70%,
LOC LaSalle Nat'l. Bank, Chicago, Illinois, VRDN 9,800,000
9,800,000 45200LHK
(Lake Forest Hosp. Proj.) 4.50%, LOC First Nat'l. Bank, Chicago,
Illinois, FRDN 2,435,000 2,435,000 45200LAT
(Little Co. of Mary Hosp.) Series 1997 B, 4.05% (MBIA Insured)
(Liquidity Facility First Nat'l. Bank, Chicago, Illinois) VRDN
19,400,000 19,400,000 45200LZM
(Rehabilitation Institute of Chicago) Series 1997, 4%,
LOC Bank of America Nat'l. Trust & Savings, NA, VRDN 6,800,000
6,800,000 45200LRM
Participating VRDN, Series PT-116, 4.14% (Liquidity Facility
RaboBank Nederland Coop. Central) (b) 9,700,000 9,700,000
45200LTT
Illinois Health Hosp. Rev. (Univ. of Chicago Hosp.) 4.20% (MBIA
Insured)
(Liquidity Facility First Nat'l. Bank, Chicago, Illinois) VRDN
12,500,000 12,500,000 45200LY6
Illinois Reg. Trans. Auth. Participating VRDN, Series SG-10,
4.17% (Liquidity Facility Societe Generale, France) (b) 6,100,000
6,100,000 759911LC
Schaumburg Village Gen. Oblig. Series 1996 A,
3.70% (BPA Credit Suisse First Boston (BK)) VRDN 5,000,000
5,000,000 806347CQ
Winnebago County Gen. Rev. (Mill Proj.) Series 1996,
4.05%, LOC Bank One, Illinois, NA, VRDN 3,235,000 3,235,000
974476AA
181,950,000
INDIANA - 1.9%
Elkart Commty. Schools TAN 4% 12/31/98 1,600,000 1,600,950
287515LS
Fort Wayne Econ. Dev. Rev. (Edy's Grand Ice Cream Proj.) Series 1985,
4.125%,
LOC Bank of America Nat'l. Trust & Savings, NA, VRDN 3,950,000
3,950,000 349247HB
Fort Wayne Poll. Cont. Rev. (General Motors Corp. Proj.) 3.70%, VRDN
4,600,000 4,600,000 349272AS
Indiana Health Facs. Auth. Hosp. Rev. (Commty. Hosp. Proj.)
Series B, 4.05%, LOC Nat'l. Bank of Detroit, NA, VRDN 7,500,000
7,500,000 454797ZW
Indianapolis Econ. Dev. Rev. Rfdg. (Morningside of College Park)
Series 1993, 4.05%, LOC Bank One, Indiana, NA, VRDN 6,095,000
6,095,000 455261QA
Richmond Econ. Dev. Rev. (Friends Fellowship Commty.) VRDN:
Rfdg. Series 1993, 4.05%, LOC Bank One, Indiana, NA 3,000,000
3,000,000 764781BR
Series 1997, 4.05%, LOC Bank One, Indiana, NA 2,200,000 2,200,000
764781BT
St. Joseph County Edl. Facs. Rev. (Notre Dame) Series 1998, 3.55%
(Liquidity Facility
Bank of America Nat'l. Trust & Savings, NA) VRDN 12,000,000
12,000,000 79061AAV
Sullivan Poll. Cont. Rev. Bonds (Hoosier Energy Rural Elec. Coop.)
Series 1985L-4,
3.30% 2/1/99 (Nat'l. Rural Utils. Coop. Guaranteed) CP mode
1,250,000 1,250,000 864991WN
Valparaiso Econ. Dev. Rev. (Indiana Retirement Commty. Proj.) 4.05%,
LOC Bank One, Indiana, NA, VRDN 3,700,000 3,700,000 920283BD
45,895,950
IOWA - 0.3%
Iowa Fin. Auth. (Wheaton Franciscan Svcs.) Series 1998 B,
3.55% (Liquidity Facility Toronto-Dominion Bank) VRDN 3,800,000
3,800,000 46246LHY
Iowa Fin. Auth. Bonds (Single Family Mtg. Backed Securities Prog.)
Series 1998 A,
3.65%, tender 2/24/99 (Canadian Imperial Bank of Commerce Guaranteed)
2,200,000 2,200,000 46246LHY
6,000,000
KANSAS - 0.8%
Burlington Poll. Cont. Rev. Bonds (Kansas Elec. Power Coop., Inc.)
Series 1985 C-2,
3.60% 10/9/98 (Nat'l. Rural Utils. Coop. Guaranteed) CP mode
1,000,000 1,000,000 121990NH
La Cygne Envir. Impt. Rev. Rfdg. (Kansas City Pwr. & Lt. Co.) Series
1994, 3.75%, VRDN 18,940,000 18,940,000 502824AB
19,940,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
KENTUCKY - 1.4%
Jefferson County Poll. Cont. Rev.:
Rfdg. (Philip Morris Co., Inc. Proj.) Series 1992, 4.15%, VRDN $
1,300,000 $ 1,300,000 473044BJ
Bonds (Louisville Gas & Elec. Co.):
Series 1993 A, 3.45% 12/17/98, CP mode 2,635,000 2,635,000
47399HBD
Series 1996 A, 3.35% 2/5/99, CP mode 4,000,000 4,000,000
47399HBF
Kentucky Asset/Liability Commission Gen. Fund TRAN Series B, 4%
6/25/99 9,000,000 9,045,939 491189AF
Kentucky Asset/Liability Commission Agcy. Fund Bonds Series 1998 A,
3.45% 2/10/99, LOC Commerzbank, AG, CP mode 1,700,000 1,700,000
49118N9B
Louisville & Jefferson County Participating VRDN, Series PT-69,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 1,460,000
1,460,000 546604BH
Trimble County Poll. Cont. Rev. Bonds (Louisville Gas & Elec. Co.)
Series 1992 A:
3.60% 10/13/98, CP mode 6,250,000 6,250,000 89699NAW
3.65% 10/13/98, CP mode 2,000,000 2,000,000 89699NAU
3.40% 12/7/98, CP mode 2,000,000 2,000,000 89699NBA
3.35% 2/5/99, CP mode 3,900,000 89699NAY 3,900,000 89699NAY
34,290,939
LOUISIANA - 2.2%
Calcasieu Ind. Dev. Board Poll. Cont. Rev. Rfdg. (PPG Inds., Inc.)
Series 1992, 4%, VRDN 10,000,000 10,000,000 128318BJ
Lafayette Econ. Dev. Auth. Ind. Dev. Rev. Rfdg. (Holt County of
Louisiana Proj.)
4.375%, LOC Chase Manhattan Bank of Texas, VRDN 3,865,000 3,865,000
506466AA
Louisiana Pub. Facs. Auth. School Health Care Sys.
(Sisters Charity Incarnate Word Sys.) Series 1997 D:
3.60% 10/15/98 (BPA Toronto-Dominion Bank) CP mode 2,000,000
2,000,000 54640A9P
3.45% 10/19/98 (BPA Toronto-Dominion Bank) CP mode 3,000,000
3,000,000 54640A9S
Parish of St. Charles Poll. Cont. Rev. (Shell Oil Co.) Series 1992 B,
4.05%, VRDN 1,400,000 1,400,000 788070BT
Parish of St. James Poll. Cont. Rev. Rfdg. Bonds (Texaco Proj.)
Series 1988 B, 3.55% 10/28/98, CP mode 12,500,000 12,498,750
7901029H
West Baton Rouge Parish Industrial Dist. #3 Rev. (Dow Chemical Co.
Proj.):
Rfdg. Bonds Series 1991:
3.60% 11/2/98, CP mode 3,800,000 3,800,000 95199MBJ
3.40% 12/1/98, CP mode 14,200,000 14,200,000 95199MBM
Series 1994 B, 4.15%, VRDN 2,600,000 951340AC 2,600,000 951340AC
53,363,750
MARYLAND - 1.0%
Maryland Gen. Oblig. Participating VRDN, Series 1998-33, 4.17%
(Liquidity Facility Morgan Stanley Dean Witter & Co.) (b) 4,000,000
4,000,000 574192MW
Maryland Hsg. & Commty. Dev. Participating VRDN, Series 1997-P,
4.12% (Liquidity Facility Caisse des Depots et Consignations) (b)
8,470,000 8,470,000 57419JQW
Southwest Resource Recovery Participating VRDN, Series 96C2001,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 11,185,000
269896K6 11,185,000 269896K6
23,655,000
MASSACHUSETTS - 2.9%
Hingham Gen. Oblig. BAN 3.75% 9/30/99 6,500,000 6,526,892 433344NK
Massachusetts Bay Trans. Auth. RAN Series 1998 B, 4.25% 9/3/99
45,000,000 45,368,679 575567KJ
Massachusetts Gen. Oblig. Participating VRDN (b):
Series 35, 4.17% (Liquidity Facility Morgan Stanley Dean Witter & Co.)
4,230,000 4,230,000 575827RJ
Series 96C2101, 4.12% (Liquidity Facility Citibank, NY, NA)
6,100,000 6,100,000 269896YM
Massachusetts Tpk. Auth. Participating VRDN, Series 1997 N, 4.15%
(Liquidity Facility Bank of America Nat'l. Trust & Savings) (b)
6,700,000 6,700,000 57604EAJ
68,925,571
MICHIGAN - 0.4%
Delta County Econ. Dev. Corp. Envir. Impt. Rev. (Mead Escanaba Corp.)
Series E, 4.15%, LOC Bank of Nova Scotia, VRDN 3,700,000 3,700,000
247568AL
Grand Rapids Econ. Dev. Corp. Ltd. Oblig. Rev. (Holland Home Proj.)
Series 1994 B, 4.05%, LOC Old Kent Bank & Trust Co., VRDN 2,250,000
2,250,000 386247AQ
Michigan Strategic Fund Ltd. Oblig. Rev. (Michigan Sugar Co. - Caro
Proj.)
Series 1991, 4.05%, LOC SunTrust Bank, Atlanta, VRDN 1,500,000
1,500,000 594692B7
Royal Oak Hosp. Fin. Auth. (William Beaumont Hosp.) Series 1996 J,
4.15% (BPA Nat'l. Bank of Detroit, NA) VRDN 2,800,000 780486EB
2,800,000 780486EB
10,250,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MINNESOTA - 1.2%
Minnesota Hsg. Fin. Agcy. Participating VRDN, Series PT-114,
4.14%, LOC RaboBank Nederland Coop. Central (b) $ 1,140,000 $
1,140,000 60415MXJ
Minnetonka Multi-Family Hsg. Rev. Rfdg. (Cliffs at Ridgedale Proj.)
Series 1995, 4.05% (FNMA Guaranteed) VRDN 20,900,000 20,900,000
604217AR
Rochester Health Care Facs. Rev. (Mayo Foundation Proj.) Series 1985
C,
4.15% (BPA RaboBank Nederland Coop. Central) VRDN 7,000,000
7,000,000 771902BS
29,040,000
MISSOURI - 2.4%
Missouri Envir. Impt. & Energy Resource Auth. Poll. Cont. Rev.:
Bonds (Union Elec. Co.) Series 1985 A, 3.35% 10/21/98,
LOC United Bank of Switzerland, AG, CP mode 2,500,000 2,500,000
610994BU
(Assoc. Elec. Coop.) Series 1993 M, 3.65% (Nat'l. Rural Utils. Coop.
Guaranteed) VRDN 13,700,000 13,700,000 606906BU 606906BU
Missouri Envir. Impt. & Energy Resource Auth. Rev. Rfdg.
(Kansas City Pwr. & Lt. Co.) Series 1992, 3.70%, VRDN 7,300,000
7,300,000 606907AH 606907AH
Missouri Health & Edl. Facs. Auth. (Lutheran Sr. Svcs. ) 3.65%,
LOC LaSalle Nat'l. Bank, Chicago, Illinois, VRDN 3,000,000
3,000,000 60635RSW
Missouri Health & Edl. Facs. Research Facs. Rev. (Stowers Institute
Med. Research)
4%, LOC Morgan Guaranty Trust Co., NY, VRDN 31,000,000 60635HPK
31,000,000 60635HPK
57,500,000
NEBRASKA - 0.3%
Nebraska Pub. Pwr. Dist. Series A, CP:
3.45% 12/8/98 (Liquidity Facility Bank of America
Nat'l. Trust & Savings, NA, Bank of Nova Scotia) 1,800,000
1,800,000 6396839Q
3.40% 2/5/99 (Liquidity Facility Bank of America
Nat'l. Trust & Savings, NA, Bank of Nova Scotia) 5,100,000
5,100,000 6396839R
6,900,000
NEVADA - 0.9%
Las Vegas Valley Water Dist. Series A, 3.40% 3/10/99, LOC United Bank
of Switzerland, AG, Westdeutsche Landesbank Girozentrale, CP
9,500,000 9,500,000 51784E9L
Nevada Gen. Oblig. Participating VRDN (b):
Series FR/RI-36, 3.80% (Liquidity Facility Bank of New York, NA)
4,100,000 4,100,000 641459B8
Series SG-20, 4.17% (Liquidity Facility Societe Generale, France)
5,815,000 5,815,000 641459NX
Nevada Hsg. Single Family Mtg. Bonds Series 1, 3.35% 3/1/99 (FGIC
Guaranteed) 2,885,000 641271YD 2,885,000 641271YD
22,300,000
NEW HAMPSHIRE - 0.6%
New Hampshire Bus. Fin. Auth. Bonds (New England Pwr. Co. Proj.)
Series 1990 B, 3.40% 5/20/99, CP mode 15,300,000 15,300,000
64499EEJ
NEW JERSEY - 0.2%
New Jersey Trans. Trust Fund Auth. Trans. Sys. Bonds Series B, 5%
6/15/99 4,000,000 4,044,158 646135GR
NEW MEXICO - 1.4%
Farmington Poll. Cont. Participating VRDN, Series A PT-133,
4.19% (Liquidity Facility Credit Suisse First Boston (BK)) (b)
33,195,000 33,195,000 311450DK
NEW YORK - 4.8%
Nassau County Serial Gen. Impt. Participating VRDN, Series PT-1069,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 5,715,000
5,715,000 592596WR
New York City Gen. Oblig.:
Participating VRDN, Series PT-1042, 4.21% (Liquidity Facility Merrill
Lynch & Co., Inc.) (b) 7,600,000 7,600,000 649668P3
VRDN:
Series 1994 B-2, 4.25%, LOC Morgan Guaranty Trust Co., NY 1,400,000
1,400,000 649660PA
Series 1994 E-2, 4.10%, LOC Morgan Guaranty Trust Co., NY
2,000,000 2,000,000 649660PX
Series 1994 E-4, 4.10%, LOC State Street Bank & Trust Co, Boston
2,000,000 2,000,000 649660QA
Series 1994 E-5, 4.10%, LOC Morgan Guaranty Trust Co., NY
2,000,000 2,000,000 649660QG
Series 1995 B-5, 3.95% (MBIA Insured) (Liquidity Facility RaboBank
Nederland Coop. Central) 6,300,000 6,300,000 649660RN
New York City Muni. Assistance Corp. Participating VRDN, Series 98
FR/RI-A11,
3.85% (Liquidity Facility Nat'l. Westminster Bank, PLC) (b)
2,450,000 2,450,000 6261903D
New York City Muni. Wtr. Fin. Auth. Participating VRDN (b):
Series PT-1032, 4.14% (Liquidity Facility Merrill Lynch & Co., Inc.)
18,700,000 18,700,000 64970KEM
Series SG-26, 4.17% (Liquidity Facility Societe Generale, France)
11,400,000 11,400,000 6497066X
New York Metropolitan Trans. Auth. Commuter Facs. Participating VRDN,
Series PT-1052A, 4.14% (Liquidity Facility Merrill Lynch & Co., Inc.)
(b) 20,235,000 20,235,000 592596WR
New York State Energy Research & Dev. Auth. Participating VRDN, Series
943202,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 2,800,000 2,800,000
269896GS
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
NEW YORK - CONTINUED
New York State Local Gov't. Assistance Corp. Participating VRDN (b):
Series PT-1040, 4.14% (Liquidity Facility Merrill Lynch & Co., Inc.)
$ 4,000,000 $ 4,000,000 649876UQ
Series PT-1068, 4.14% (Liquidity Facility Merrill Lynch & Co., Inc.)
16,810,000 16,810,000 649876UW
New York State Med. Care Facs. Fin. Agcy. Participating VRDN (b):
Series PA-89, 4.14% (Liquidity Facility Merrill Lynch & Co., Inc.)
3,875,000 3,875,000 64988KDH
Series PT-145A, 4.14% (Liquidity Facility Merrill Lynch & Co., Inc.)
4,655,000 4,655,000 64988KJ8
New York State Pwr. Auth. Rev. & Gen. Series 1, 3.60% 10/16/98
(Liquidity Facility
Bank of Nova Scotia, Morgan Guaranty Trust Co., NY) CP 3,100,000
3,100,000 64999HCU
115,040,000
NEW YORK & NEW JERSEY - 0.2%
New York & New Jersey Port Auth. Versatile Structure Oblig. 4.20%
(BPA Morgan Guaranty Trust Co., NY) VRDN 5,000,000 5,000,000
73358EAL
NORTH CAROLINA - 0.9%
North Carolina Eastern Muni. Pwr. Auth. Bonds 3.65% 10/21/98,
LOC Morgan Guaranty Trust Co., NY, United Bank of Switzerland, AG, CP
mode 5,760,000 5,760,000 658994FE
Raleigh-Durham Arpt. Auth. Spl. Facs. Rev. Rfdg. (American Airlines,
Inc.) VRDN:
Series1995 A, 4.15%, LOC Royal Bank of Canada 14,400,000
14,400,000 751076AT
Series 1995 B, 4.15%, LOC Royal Bank of Canada 2,300,000 2,300,000
751076AV
22,460,000
OHIO - 3.2%
Clinton County Hosp. Rev. (Hosp. Cap., Inc. Pooled Fing. Prog.)
Series 1998, 3.65%, LOC Fifth Third Bank, VRDN 10,800,000
10,800,000 187490AB
Cuyahoga County Hosp. Rev. (Cleveland Clinic Foundation) Series 1997
D, 4.15%
(Liquidity Facility Bank of America Nat'l. Trust & Savings, NA) VRDN
1,200,000 1,200,000 232265U2
Franklin County Ind. Dev. Rev. Rfdg. (Alco Standard Corp. Proj.)
Series 1994, 4.05%, LOC NationsBank of North Carolina, VRDN
1,700,000 1,700,000 353190VM
Greene County Gen. Oblig. BAN 3.90% 9/9/99 4,302,400 4,313,446
394640U5
Marion County Hosp. Rev. (Pooled Lease Prog.) Series 1992,
4.05%, LOC Bank One, NA, VRDN 1,210,000 1,210,000 569122AZ
Medina County Health Care Facs. (Oaks at Medina Proj.)
Series B. 4.05%, LOC Bank One, NA, VRDN 7,100,000 7,100,000
584723AL
Ohio Higher Edl. Facs. Rev. (Pooled Fing. Prog.) VRDN:
Series 1997, 4.05%, LOC Fifth Third Bank 24,355,000 24,355,000
67756ADF
4.05%, LOC Firth Third Bank 10,030,000 10,030,000 67756AFT
Ohio Wtr. Dev. Auth. Collateralized Poll. Cont. Rev. Rfdg. Bonds
(Cleveland Elec. Illum. Co. Proj.) Series 1988 A, 3.35% 2/19/99
(FGIC Insured) (Liquidity Facility FGIC Security Purchase, Inc.) CP
mode 14,650,000 14,650,000 6799973Y
75,358,446
PENNSYLVANIA - 7.1%
Allegheny County Hosp. Dev. Auth. Health Ctr. Rev. (Presbyterian Univ.
Health Sys.)
Series 1990 B, 4.05% (MBIA Insured) (BPA PNC Bank, NA) VRDN
8,000,000 8,000,000 0172894U
Allegheny County Ind. Dev. Auth., VRDN:
Rev. Rfdg. (N. Versailles Shopping Ctr.) Series 1992, 4.05%, LOC Bank
One, NA 3,065,000 3,065,000 017292QU
(Longwood at Oakmont, Inc.) Series 1997 A, 4.10%, LOC Dresdner Bank,
AG 2,300,000 2,300,000 017292SK
(Jewish Home & Hosp. for Aged) Series 1996 B, 4.05%, LOC PNC Bank, NA
4,140,000 4,140,000 017292SB
Beaver County Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Duquesne Lt. Co.
Proj.) Series 1994,
3.35% 10/19/98, LOC United Bank of Switzerland, AG, CP mode
2,500,000 2,500,000 074997AL
Berks County Ind. Dev. Auth. Rev., VRDN:
(Continental Assurance Co. Proj.) Series 1982, 3.55% (Continental
Casualty Co. Guaranteed) 1,500,000 1,500,000 084517AS
(Lutheran Home at Topton Proj.) Series 1993 B, 3.70%, LOC First Union
Nat'l. Bank (NC) 8,700,000 8,700,000 084522EM
Dauphin County Gen. Auth., VRDN:
School Dist. (Pooled Fin. Prog.) 3.80% (AMBAC Insured)
(BPA Bank of Nova Scotia, Commerzbank, AG) 14,400,000 14,400,000
238259R7
(All-Health Pooled Fin. Prog.):
Series 1997 A, 3.65% (FSA Insured) (Liquidity Facility Credit Suisse
First Boston (BK)) 38,690,000 38,690,000 238259R9
3.65% (AMBAC Insured) (BPA Credit Suisse First Boston (BK))
25,000,000 25,000,000 238259S2
Delaware County Auth. Hosp. Rev. (Crozer-Chester Med. Ctr.)
Series 1996, 4.07%, LOC Kredietbank, VRDN 4,900,000 4,900,000
246006ML
Delaware County Ind. Dev. Auth. Poll. Cont. Rev. Bonds
(Philadelphia Elec. Co.) Series 1988 B, CP mode:
3.35% 10/1/98 (FGIC Insured) 3,000,000 3,000,000 246991SQ
3.50% 10/8/98 (FGIC Insured) 3,900,000 3,900,000 246991SQ
Lancaster Higher Ed. Auth. College Rev. (Franklin & Marshall College)
4.10% (BPA Chase Manhattan Bank) VRDN 14,805,000 14,805,000
514328DS
Lehigh County Ind. Dev. Rev. (The Keebler Corp.) Series 1992,
4.05%, LOC Bank of Nova Scotia, VRDN 3,940,000 3,940,000 524807AT
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
PENNSYLVANIA - CONTINUED
North Lebanon Township Muni. Auth. (Grace Commty., Inc. Proj.)
Series 1992 B, 3.70%, LOC First Union Nat'l. Bank (NC) VRDN $
1,425,000 $ 1,425,000 660446AQ
Pennsylvania Econ. Dev. Auth. Rev. (Foxdale Village Proj.)
Series 1989 C, 4.05%, LOC PNC Bank, NA, VRDN 2,150,000 2,150,000
708684AJ
Philadelphia Hosp. Rev. (Children's Hosp. Proj.) Series 1996 A, 4.15%
(Liquidity Facility Morgan Guaranty Trust Co., NY) VRDN 7,450,000
7,450,000 717903XM
Philadelphia Ind. Dev. Rev. (Institute for Cancer Research Fox Chase
Proj.) VRDN:
Series 1990 A, 4.15%, LOC Morgan Guaranty Trust Co., NY 1,000,000
1,000,000 717818MJ
Series 1997, 4.15%, LOC Morgan Guaranty Trust Co., NY 1,700,000
1,700,000 717818MJ
Philadelphia Redev. Auth. School Rev. (School for the Deaf) 3.80%, LOC
PNC Bank, NA, VRDN 3,500,000 3,500,000 717870AA
Scranton-Lackawanna Health & Welfare Auth. (Elan Gardens Proj.) Series
1996,
4.20%, LOC PNC Bank NA, VRDN 4,000,000 4,000,000 810694WX
South Fork Muni. Auth. Hosp. Rev. (Lee Hosp. Proj.)
Series 1993 B, 4.05%, LOC PNC Bank, NA, VRDN 5,070,000 5,070,000
83786DBD
Titusville School Dist. Participating VRDN, Series PA-191,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 4,495,000
4,495,000 888675CD
West Cornwall Muni. Auth. Rev. (Lebanon Valley Brethren Home)
3.70%, LOC First Union Nat'l. Bank (NC) VRDN 875,000 875,000
952354AS
170,505,000
RHODE ISLAND - 0.1%
Rhode Island Health & Edl. Bldg. Rev. (Providence Country Day School)
Series 1996, 4%, LOC Fleet Nat'l. Bank, VRDN 1,995,000 1,995,000
762195AA
SOUTH CAROLINA - 1.7%
South Carolina Edl. Facs. Auth. (Allen Univ. Proj.) 4.05%, LOC
NationsBank, NA, VRDN 4,000,000 4,000,000 836896BN
South Carolina Cap. Impt. Participating VRDN, Series BTP-27,
4.14% (Liquidity Facility Automatic Data Processing, Inc.) (b)
1,326,000 1,326,000 8371065W
South Carolina Hsg. Fin. & Dev. Auth. Multi-Family Hsg. Rev. Rfdg.,
VRDN:
(Charleston Oxford) Series 1990 B, 3.70% (Continental Casualty Co.
Guaranteed) 10,180,000 10,180,000 83712EAA
(Greenville Oxford) Series 1990 A, 3.70% (Continental Casualty Co.
Guaranteed) 4,855,000 4,855,000 83712EAB
(Richland Oxford) Series 1990 C, 3.70% (Continental Casualty Co.
Guaranteed) 5,130,000 5,130,000 83712EAC
South Carolina Jobs Econ. Dev. Auth. Healthcare Facs. Rev. (The
Methodist Home Proj.)
Series 1994, 4.05%, LOC NationsBank, NA, VRDN 5,600,000 5,600,000
837033BX
South Carolina Pub. Svc. Auth. Participating VRDN, Series 96C4001,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 6,900,000 6,900,000
269896ZM
Walhalla Rev. Rfdg. (Avondale Mills Inc. Proj.) Series 1990,
4.05%, LOC SunTrust Bank, Atlanta, VRDN 1,800,000 1,800,000
931471AA
39,791,000
SOUTH DAKOTA - 0.1%
South Dakota Health & Ed. Facs. Auth. Rev. Rfdg. (Sioux Valley Hosp.)
Series 1992 A, 4.05%, VRDN 3,000,000 3,000,000 837559J5
TENNESSEE - 1.3%
Jackson Hsg. Fac. Board Multi-Family Hsg. Rev. Rfdg. (Post House North
Apts. Proj.)
4.05%, LOC SouthTrust Bank, NA, Alabama, VRDN 3,585,000 3,585,000
468741BK
Knoxville Wtr. Participating VRDN, Series BT-57, 4.19%
(Liquidity Facility Automatic Data Processing, Inc.) (b) 3,540,000
3,540,000 499818MG
Memphis Ctr. Rev. Fin. Corp. (Arbors of Harbor Town Project)
Series 1990, 4.10% (Northwestern Mutual Guaranteed) VRDN 4,700,000
4,700,000 586072AQ
Memphis Gen. Impt. Participating VRDN, Series SG-23,
4.17% (Liquidity Facility Societe Generale, France) (b) 30,000
30,000 586145BS
Nashville & Davidson County Metropolitan Govt. Gen. Oblig.
Participating VRDN,
Series SG-11, 3.70% (Liquidity Facility Societe Generale, France) (b)
2,100,000 2,100,000 592013YD
Rutherford County Ind. Dev. (Cumberland-Swan, Inc. Proj.) Series 1987,
4.05%, LOC SunTrust Bank, Nashville, NA, VRDN 1,075,000 1,075,000
783260HD
Sevier County Pub Bldg., VRDN:
Series D1, 3.97% (AMBAC Insured) (Liquidity Facility KBC Bank, NV)
1,500,000 1,500,000 818200CM
Series 2D2, 3.97% (AMBAC Insured) (Liquidity Facility KBC Bank, NV)
4,000,000 4,000,000 818200CN
Shelby County Gen. Oblig. 3.35% 3/1/99 (Liquidity Facility Landesbank
Hessen-Thuringen) CP 10,000,000 10,000,000 8216859J
30,530,000
TEXAS - 17.2%
Austin Combined Util. Sys.:
Participating VRDN, Series PT-127,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 2,300,000
2,300,000 052474SF
Series A, CP:
3.45% 12/17/98, LOC Morgan Guaranty Trust Co., NY 2,800,000
2,800,000 05199JAJ
3.35% 2/19/99, LOC Morgan Guaranty Trust Co., NY 5,007,000
5,007,000 05199JAL
3.35% 3/1/99, LOC Morgan Guaranty Trust Co., NY 4,900,000
4,900,000 05199JAM
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
TEXAS - CONTINUED
Austin Higher Ed. Auth. (St. Edward's Univ.) Series 1995, 4.05%, LOC
NationsBank of Texas, VRDN $ 12,000,000 $ 12,000,000 05242EAA
Austin Hsg. Fin. Corp. Multi-Family Hsg. Rev. (Riverchase Proj.)
Series 1985 A,
4.20%, LOC Household Finance Corp., VRDN 6,000,000 6,000,000
052425BS
Bexar County Health Facs. Dev. Corp. Rev. (Warm Springs Rehabilitation
Proj.)
Series 1997, 4.05%, LOC Chase Manhattan Bank of Texas, VRDN
5,400,000 5,400,000 088354CL
Brazos River Hbr. Navigation Dist. of Brazoria Rev. Bonds
(Dow Chemical Co.) Series 1991, 3.65% 11/10/98, CP mode 13,900,000
13,900,000 10599DKL
Brownsville Util. Sys. Series A, 3.35% 2/1/99, LOC Toronto-Dominion
Bank, CP 1,000,000 1,000,000 1164759V
Coastal Wtr. Auth of Texas Participating VRDN, 4.12% (Liquidity
Facility
Caisse des Depots et Consignations) (b) 6,175,000 6,175,000
19058FBS
Colorado River Muni. Wtr. Dist. Participating VRDN, Series PA-187,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 2,000,000
2,000,000 196558LB
Comal County Health Facs. Dev. (McKenna Mem. Health Sys.)
4.05%, LOC Chase Manhattan Bank of Texas, VRDN 2,900,000 2,900,000
199804AD
Dallas Civic Ctr. Convention Complex Participating VRDN, Series
PT-1059,
4.14% (Liquidity Merrill Lynch & Co., Inc.) (b) 8,325,000 8,325,000
235258JF
Dallas Area Rapid Transit Sales Tax Rev. Series A, CP:
3.35% 2/2/99, LOC Westdeutsche Landesbank Girozentrale, United Bank of
Switzerland, AG 3,100,000 3,100,000 23599QBE
3.45% 3/25/99, LOC Westdeutsche Landesbank Girozentrale, United Bank
of Switzerland, AG 11,000,000 11,000,000 23599QBE
Farmers Branch Ind. Dev. Corp. Rev. Rfdg. (PPG Inds., Inc. Proj.)
Series 1992, 4%, VRDN 3,700,000 3,700,000 309522AG
Grapevine-Colleyville Participating VRDN, Series SG-69, 4.12%
(Liquidity Facility Society Generale, France) (b) 6,575,000
6,575,000 388640XM
Greater East Texas Higher Ed. Auth. Student Loan Rev. Rfdg. Bonds
Series 1992 A,
3.55%, tender 9/1/99, LOC Student Loan Marketing Assoc. 10,200,000
10,200,000 391693AS
Harris County Health Facs. Dev. Corp. Rev., VRDN:
(Buckner Retirement Svcs. Proj.) 4.10%, LOC Chase Manhattan Bank of
Texas, NationsBank, NA 15,000,000 15,000,000 41315RAG
(St. Lukes Hospital) Series A, 4.10% (BPA Morgan Guaranty Trust Co,
NY) VRDN 23,310,000 23,310,000 41315RBD
Houston Gen. Oblig., CP:
Series A, 3.45% 10/16/98 (Liquidity Facility Toronto-Dominion Bank)
17,900,000 17,900,000 44399BCL
Series B:
3.55% 10/30/98 (Liquidity Facility Morgan Guaranty
Trust Co., NY, United Bank of Switzerland, AG) 3,200,000
3,200,000 44399BCT
3.42% 12/14/98 (Liquidity Facility Morgan Guaranty
Trust Co., NY, United Bank of Switzerland, AG) 12,000,000
12,000,000 44399BCR
Series C, 3.45% 10/16/98 (Liquidity Facility Toronto-Dominion Bank)
2,200,000 2,200,000 44399BCM
Houston Hsg. Fin. Corp. Participating VRDN,
Series PT-1, 4.14% (Liquidity Facility Banque Nationale de Paris) (b)
12,660,000 12,660,000 442397FS
Houston Wtr. & Swr. Sys. Rev.:
Participating VRDN (b):
Series 1998 FR/RI-5, 3.80% (Liquidity Facility Bank of New York, NA)
(b) 9,600,000 9,600,000 442436B2
Series SG-24, 4.17% (Liquidity Facility Societe Generale, France)
(b) 6,840,000 6,840,000 442436UU
Series A, 3.40% (Liquidity Facility Credit Suisse First Boston (BK)
Westdeutsche Landesbank Girozentrale) CP 3,300,000 3,300,000
44299VCE
Matagorda County Navigation Dist #1 Participating VRDN, Series 1997 D,
4.12% (Liquidity Facility Caisse des Depots et Consignations) (b)
4,840,000 4,840,000 57652TAJ
North Central Health Facs. Dev. Corp. Hosp. Rev. Bonds (Methodist
Hosp. of Dallas):
Series 1991 B, 3.40% 12/17/98 (MBIA Insured)
(BPA RaboBank Nederland Coop. Central) CP mode 7,000,000 7,000,000
658999AX
Series 1998, 3.40% 3/5/99 (AMBAC Insured) (Liquidity Facility
RaboBank Nederland Coop. Central) CP mode 31,000,000 31,000,000
658999AY
North Texas Tollway Auth. Participating VRDN, Series PA-188,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 10,000,000
10,000,000 662858AY
Plano Health Facs. Dev. Corp. Hosp. Rev. Bonds (Childrens &
Presbyterian Health Care Ctr.):
3.65% 10/21/98 (MBIA Insured) (BPA Chase Manhattan Bank of Texas) CP
mode 1,000,000 1,000,000 727999BD
3.35% 10/22/98 (MBIA Insured) (BPA Chase Manhattan Bank of Texas) CP
mode 3,000,000 3,000,000 727999BL
Port Arthur Navigation Dist. Poll. Cont. Rev. Rfdg. (Texaco, Inc.
Proj.) Series 1994, 4.15%, VRDN 1,300,000 1,300,000 735222AH
San Antonio Elec. & Gas Sys. Series A, CP:
3.25% 10/13/98 (Liquidity Facility Chase Manhattan
Bank of Texas, Morgan Guaranty Trust Co., NY) 28,250,000
28,250,000 798992HQ
3.65% 10/16/98 15,000,000 15,000,000 798992HC
3.40% 12/1/98 (Liquidity Facility Chase Manhattan
Bank of Texas, Morgan Guaranty Trust Co., NY) 3,300,000 3,300,000
798992HQ
3.40% 1/12/99 (Liquidity Facility Chase Manhattan
Bank of Texas, Morgan Guaranty Trust Co., NY) 3,700,000 3,700,000
798992HT
San Antonio Wtr. Participating VRDN, Series 1996,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 7,500,000 7,500,000
269896Y3
San Antonio Wtr. Sys. Series 1995, 3.60% 10/1/98 (Liquidity Facility
Westdeutsche Landesbank Girozentrale) CP 5,000,000 5,000,000
798992HS
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
TEXAS - CONTINUED
Sherman Higher Ed. Fin. Corp. (Austin College Proj.) Series 1997,
4.05%,
LOC NationsBank, NA, VRDN $ 12,700,000 $ 12,700,000 824174AR
Tarrant County Health Facs. Dev. Corp. Rev. (Advantist Health System
Sunbelt)
Series 1996 A, 4.05%, LOC SunTrust Bank, Central Florida, NA, VRDN
12,595,000 12,595,000 87638LAX
Texas Dept. of Hsg. & Commty. Affairs Participating VRDN, Series PT-9,
4.14%
(Liquidity Facility Merrill Lynch & Co., Inc.) (b) 2,640,000
2,640,000 882749BS
Texas Gen. Oblig. TRAN Series 1998-1999, 4.50% 8/31/99 2,400,000
2,428,474 882719Z2
Texas Hsg. & Commty. Participating VRDN, Series PA-126, 4.14%
(Liquidity Facility Merrill Lynch & Co., Inc.) (b) 3,365,000
3,365,000 88275FDR
Texas Muni. Pwr. Agcy., CP:
3.35% 10/19/98 (Liquidity Facility Morgan Guaranty Trust Co., NY,
Chase Manhattan Bank of Texas) 8,200,000 8,200,000 882999FH
3.45% 10/19/98 (Liquidity Facility Morgan Guaranty Trust Co., NY,
Chase Manhattan Bank of Texas) 2,600,000 2,600,000 882999FF
3.45% 10/22/98 (Liquidity Facility Morgan Guaranty Trust Co., NY,
Chase Manhattan Bank of Texas) 3,300,000 3,300,000 882999FG
Texas Pub. Fin. Auth. Bldg. Rev. Rfdg. Bonds (Dept. of
Criminal Justice Proj.) Series1998 A, 4.25% 2/1/99 3,375,000
3,380,649 88275MJU
Texas Small Bus. Ind. Dev. Corp. (Pub. Fac. Cap. Access Prog.) 3.65%,
LOC Credit Suisse First Boston (BK), Nat'l. Westminster Bank, PLC,
VRDN 7,000,000 7,000,000 882692AL
Texas Tpk. Auth. Participating VRDN, Series PA-189,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 12,595,000
12,595,000 882780GA
Texas Wtr. Dev. Board Participating VRDN, Series SGA-23, 3.70%
(Liquidity Facility Societe Generale, France) (b) 1,900,000
1,900,000 882854CN
Texas Wtr. Dev. Board Rev. Series 1992 A, 4.20% (Liquidity Facility
Canadian Imperial Bank of Commerce) VRDN 1,400,000 1,400,000
882716UB
University of Texas Fing. Sys. Rev. Series A, 3.35% 12/8/98, CP
2,934,000 2,934,000 92199LBP
411,220,123
UTAH - 2.7%
Intermountain Pwr. Agcy. Supply Rev.:
Bonds:
Rfdg.:
Series 1985 E-2:
3.45% 10/19/98 (AMBAC Insured) (BPA United Bank of Switzerland, AG)
CP mode 1,500,000 1,500,000 458997HW
3.40% 1/14/99 (AMBAC Insured) (BPA United Bank of Switzerland, AG)
CP mode 5,000,000 5,000,000 458997JH
Series 1985 F, 3.35% 2/2/99, LOC Bank of America Nat'l. Trust &
Savings, NA, CP mode 4,300,000 4,300,000 458997JQ
Series E, 3.35% 2/11/99, LOC Bank of America Nat'l. Trust &
Savings, NA, CP mode 8,000,000 8,000,000 458997JT
Series 1997 B-3, 3.55% 2/23/99 (Liquidity Facility Bank of Nova
Scotia,
Bank of America Nat'l. Trust & Savings, NA) CP mode 2,300,000
2,300,000 458997HU
Series F, 3.35% 2/1/99 (AMBAC Insured) (BPA United Bank of
Switzerland) CP mode 3,300,000 3,300,000 458997JJ
CP:
Series 1997 B-1, 3.35% 2/2/99 (Liquidity Facility Bank of America
Nat'l. Trust & Savings, NA, Bank of Nova Scotia) 8,400,000
8,400,000 458997JR
Series 1998 B-5:
3.35% 10/22/98 (Liquidity Facility Morgan Guaranty Trust Co., NY)
2,000,000 2,000,000 458997JC
3.60% 11/12/98 (Liquidity Facility Morgan Guaranty Trust Co., NY)
2,000,000 2,000,000 458997HC
Participating VRDN, Series 96C4402, 4.12% (Liquidity Facility
Citibank, NY, NA) (b) 4,800,000 4,800,000 269896ZX
Taylorsville Ind. Dev. Rev. (BDS Hermes Assoc. Proj.) 4.05%, LOC Bank
One, Arizona, NA, VRDN 5,000,000 5,000,000 877527AA
Utah Gen. Oblig. Hwy. Series 1998 B, 3.40% 12/9/98, CP 9,000,000
9,000,000 91755X9F
Utah Hsg. Fin. Auth. Single Family Mtg. Rev. Series 1998, 3.60%
(Bayerische Landesbank Girozentrale Guaranteed) VRDN 7,755,000
91755NLJ 7,755,000 91755NLJ
63,355,000
VIRGINIA - 3.2%
Alexandria Redev. & Hsg. Auth. Residential Care Facs. 1st Mortgage
Rev. (Goodwyn House)
Series 1996 B, 4.10%, LOC First Union Nat'l. Bank (NC) VRDN
2,865,000 2,865,000 015333AT
Chesapeake Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Virginia Elec. Pwr.
Co. Proj.)
Series 1985, 3.40% 2/18/99, CP mode 1,100,000 1,100,000 16599KAX
Chesterfield Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Virginia Elec. &
Pwr. Co. Proj.):
Series 1985, 3.45% 2/24/99, CP mode 2,400,000 2,400,000 166999JU
Series 1987 A:
3.65% 11/12/98 (Liquidity Facility Bank of New York, NA, NationsBank,
NA) CP mode 2,350,000 2,350,000 166999JR
3.40% 2/18/99 (Liquidity Facility Bank of New York, NA, NationsBank,
NA) CP mode 14,000,000 14,000,000 166999JW
Series B:
3.70% 10/9/98, CP mode 1,500,000 1,500,000 166999JH
3.60% 10/15/98, CP mode 5,000,000 5,000,000 166999JL
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
VIRGINIA - CONTINUED
Chesterfield Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Virginia Elec. &
Pwr. Co. Proj.): - continued 166999JU
Series B:
3.60% 10/20/98, CP mode $ 2,985,000 $ 2,985,000 166999JM
3.65% 11/13/98, CP mode 2,000,000 2,000,000 166999JP
3.40% 12/16/98, CP mode 4,000,000 4,000,000 166999JT
Louisa Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Virginia Elec. & Pwr.
Co. Proj.):
Series 1985:
3.60% 10/15/98, CP mode 8,000,000 8,000,000 546994GW
3.65% 11/13/98, CP mode 2,700,000 2,700,000 546994GX
3.40% 12/16/98, CP mode 8,700,000 8,700,000 546994HC
Series 1987, 3.45% 2/24/99, CP mode 2,500,000 2,500,000 546994HD
Peninsula Port Auth. Rev. Rfdg. (Dominion Term. Assoc.)
Series 1987 D, 4.15%, LOC Barclays Bank, PLC, VRDN 2,805,000
2,805,000 707162AV
Prince William Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Virginia Elec.
& Pwr. Co. Proj.):
3.40% 2/18/99, CP mode 1,100,000 1,100,000 74599RAG
3.45% 2/24/99, CP mode 1,700,000 1,700,000 74599RAF
Roanoke Ind. Dev. Auth. Hosp. (Carilion Health Sys.) Series 1997 A,
4.20% (Liquidity Facility NationsBank, NA) VRDN 8,800,000 8,800,000
770084CS
Waynesboro Residential Care Rev. (Sunnyside Presbyterian Home) Series
1997,
4.10%, LOC First Union Nat'l. Bank (NC) VRDN 1,340,000 1,340,000
946655AA
75,845,000
WASHINGTON - 2.9%
Kent Gen. Oblig. Participating VRDN, Series SGA-27,
3.70% (Liquidity Facility Societe Generale, France) (b) 4,100,000
4,100,000 490746RD
Port Seattle Rev. Series A, 3.60% 12/18/98, LOC Bank of America Nat'l.
Trust & Savings, NA, CP 7,715,000 7,715,000 735997AC
Washington Gen. Oblig. Participating VRDN (b):
Series 1993 C, 4.12% (Liquidity Facility Citibank, NY, NA)
21,700,000 21,700,000 2698969B
Series SGA-36, 3.70% (Liquidity Facility Societe Generale, France)
2,000,000 2,000,000 939745GJ
Washington Motor Vehicle Fuel Tax Participating VRDN, Series 964701,
4.12% (Liquidity Facility Citibank, NY, NA) (b) 18,015,000
18,015,000 269896TX
Washington Pub. Pwr. Supply Sys.:
Participating VRDN, Series PT-180, 4.19% (Liquidity Facility
Bayerische Hypotheken und Wechsel Bank) (b) 3,100,000 3,100,000
939827B2
Rev. Rfdg.:
(Nuclear Proj. #1) Series 1993-1A2, 3.45%, LOC Bank of America
Nat'l. Trust & Savings, NA, VRDN 10,100,000 10,100,000 939827UN
Bonds (Nuclear Proj. #2) Series A, 4.75% 7/1/99 1,450,000
1,464,466 939828XX
68,194,466
WEST VIRGINIA - 0.8%
Cabell County Commission (Life Care Facs. Foster Foundation) Series
1998
4.07%, LOC Huntington Nat'l. Bank, Columbus, Ohio, VRDN 5,100,000
5,100,000 12681MAB
Cabell County Nursing & Rehab Rev. (17th Street LP) Series 1993,
4.05%, LOC NationsBank, NA, VRDN 1,985,000 1,985,000 12681AAA
Grant County Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Virginia Elec. &
Pwr. Co. Proj.)
Series 1994, 3.35% 2/10/99, CP mode 2,300,000 2,300,000 38899BAN
Kanawha County Commercial Dev. Rev. Rfdg. (McJunkin Corp. Proj.)
Series 1991,
4.05%, LOC NationsBank NA, VRDN 3,735,000 3,735,000 48366LAA
West Virginia Build Commission (Davis & Elkins College Proj.)
4.07%, LOC Huntington Nat'l. Bank, Columbus, Ohio, VRDN 6,000,000
287807AA 6,000,000 287807AA
19,120,000
WISCONSIN - 1.2%
Kenosha Unified School Dist. # 001 TRAN 3.38% 9/28/99 4,700,000
4,700,000 489836FY
Milwaukee Gen. Oblig. RAN Series 1998-A, 5% 2/25/99 4,500,000
4,527,653 602364YR
New Berlin School Dist. TRAN 3.75% 8/26/99 2,100,000 2,107,980
642305MF
Village of Rothschild Poll. Cont. Rev. (Weyherhaeuser Co. Proj.)
Series 1982, 4.06%, VRDN 2,400,000 2,400,000 778772AY
Wausau School Dist. TRAN 3.75% 9/22/99 2,000,000 2,005,247
943363GA
Wisconsin Gen. Oblig.:
RAN 4.50% 6/15/99 3,000,000 3,024,157 977056RB
Series 1997 A, 3.45% 10/22/98 (Liquidity Facility Bank of Nova
Scotia, Commerzbank, AG) CP 4,032,000 4,032,000 9770539A
Wisconsin Health & Ed. Fac. Auth. Bonds (SSM Healthcare Sys.) Series
1998 B,
3.55% 2/11/99 (MBIA Insured) (Liquidity Facility First Nat'l. Bank,
Chicago, Illinois) CP mode 5,000,000 5,000,000 9771049M
27,797,037
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
WYOMING - 0.9%
Converse County Ind. Dev. Auth. Poll. Cont. Rev. Bonds (Pacificorp
Proj.) Series 1992,
3.55% 10/30/98, LOC United Bank of Switzerland, AG, CP mode $
12,000,000 $ 12,000,000 2124919W
Sublette County Poll. Cont. Rev. (Exxon Proj.) Series 1984, 4.10%,
VRDN 2,550,000 2,550,000 864283AA
Sweetwater County Poll. Cont. Rev. Rfdg. Bonds (Pacificorp Proj.)
Series 1992 B, 3.55%, LOC United Bank of Switzerland, AG, CP mode
3,305,000 3,305,000 864283AA
Wyoming Commty. Dev. Auth. Participating VRDN, Series PT-112,
4.14% (Liquidity Facility Merrill Lynch & Co., Inc.) (b) 2,220,000
2,220,000 98322PGH
20,075,000
MULTIPLE STATES - 0.5%
Stephens Equity Trust #I Participating VRDN, Series 1996,
4.12%, LOC Bayerische Hypotheken und Wechsel Bank (b) 11,000,000
11,000,000 29477BAA
TOTAL INVESTMENTS - 100% $ 2,387,044,500
Total Cost for Income Tax Purposes $ 2,387,044,500
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Notes
CP - Commercial Paper
FRDN - Floating Rate Demand Notes
RAN - Revenue Anticipation Notes
TAN - Tax Anticipation Notes
TRAN - Tax and Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At May 31, 1998, the fund had a capital loss carryforward of
approximately $347,000 all of which will expire on May 31, 2005.
TAX-EXEMPT PORTFOLIO
FINANCIAL STATEMENTS
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STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
ASSETS
INVESTMENT IN SECURITIES, AT VALUE - SEE ACCOMPANYING SCHEDULE $ 2,387,044,500
RECEIVABLE FOR INVESTMENTS SOLD 43,575,315
INTEREST RECEIVABLE 12,027,395
TOTAL ASSETS 2,442,647,210
LIABILITIES
PAYABLE TO CUSTODIAN BANK $ 69,420
PAYABLE FOR INVESTMENTS PURCHASED 109,602,548
SHARE TRANSACTIONS IN PROCESS 153,542
DISTRIBUTIONS PAYABLE 4,515,482
ACCRUED MANAGEMENT FEE 300,833
DISTRIBUTION FEES PAYABLE 15,432
OTHER PAYABLES AND 145,461
ACCRUED EXPENSES
TOTAL LIABILITIES 114,802,718
NET ASSETS $ 2,327,844,492
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 2,328,114,348
ACCUMULATED NET REALIZED GAIN (LOSS) ON INVESTMENTS (269,901)
UNREALIZED GAIN FROM ACCRETION 45
OF DISCOUNT
NET ASSETS $ 2,327,844,492
CLASS I: $1.00
NET ASSET VALUE, OFFERING PRICE
AND REDEMPTION PRICE PER
SHARE ($2,235,818,817 (DIVIDED BY)
2,236,078,003 SHARES)
CLASS II: $1.00
NET ASSET VALUE, OFFERING PRICE
AND REDEMPTION PRICE PER
SHARE ($50,464,247 (DIVIDED BY)
50,470,088 SHARES)
CLASS III: $1.00
NET ASSET VALUE, OFFERING PRICE
AND REDEMPTION PRICE PER
SHARE ($41,561,428 (DIVIDED BY)
41,566,257 SHARES)
</TABLE>
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STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INTEREST INCOME $ 43,187,269
EXPENSES
MANAGEMENT FEE $ 2,364,239
TRANSFER AGENT FEES
CLASS I 263,591
CLASS II 5,695
CLASS III 6,760
DISTRIBUTION FEES
CLASS II 28,733
CLASS III 56,781
ACCOUNTING FEES AND EXPENSES 138,274
CUSTODIAN FEES AND EXPENSES 72,631
REGISTRATION FEES
CLASS I 78,327
CLASS II 7,871
CLASS III 8,140
AUDIT 18,196
MISCELLANEOUS 8,412
TOTAL EXPENSES BEFORE REDUCTIONS 3,057,650
EXPENSE REDUCTIONS (636,755) 2,420,895
NET INTEREST INCOME 40,766,374
REALIZED AND UNREALIZED GAIN (LOSS) (13,769)
NET REALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES
INCREASE (DECREASE) IN NET 45
UNREALIZED GAIN FROM ACCRETION
OF DISCOUNT
NET GAIN (LOSS) (13,724)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 40,752,650
</TABLE>
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STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 1998 MARCH 31,
(UNAUDITED) 1998
OPERATIONS $ 40,766,374 $ 80,770,114
NET INTEREST INCOME
NET REALIZED GAIN (LOSS) (13,769) 143,752
INCREASE (DECREASE) IN NET UNREALIZED GAIN FROM ACCRETION OF DISCOUNT 45 (104)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 40,752,650 80,913,762
DISTRIBUTIONS TO SHAREHOLDERS FROM NET INTEREST INCOME:
CLASS I (39,404,864) (78,055,074)
CLASS II (632,054) (1,433,516)
CLASS III (729,456) (1,281,524)
TOTAL DISTRIBUTIONS (40,766,374) (80,770,114)
SHARE TRANSACTIONS - NET INCREASE (DECREASE) AT NET ASSET VALUE OF $1.00 PER SHARE:
CLASS I 99,945,984 113,557,163
CLASS II 19,637,163 (29,425,399)
CLASS III 4,290,004 10,958,613
TOTAL SHARE TRANSACTIONS 123,873,151 95,090,377
TOTAL INCREASE (DECREASE) IN NET ASSETS 123,859,427 95,234,025
NET ASSETS
BEGINNING OF PERIOD 2,203,985,065 2,108,751,040
END OF PERIOD $ 2,327,844,492 $ 2,203,985,065
</TABLE>
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SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
</TABLE>
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FINANCIAL HIGHLIGHTS - CLASS I
SIX MONTHS ENDED YEARS ENDED MARCH 31, TEN MONTHS YEAR ENDED
SEPTEMBER 30, 1998 ENDED MAY 31,
MARCH 31,
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 1995 1994
NET ASSET VALUE, BEGINNING OF PERIOD $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
INCOME FROM INVESTMENT OPERATIONS
NET INTEREST INCOME .017 .035 .033 .036 .027 .024
LESS DISTRIBUTIONS
FROM NET INTEREST INCOME (.017) (.035) (.033) (.036) (.027) (.024)
NET ASSET VALUE, END OF PERIOD $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
TOTAL RETURN B, C 1.76% 3.60% 3.40% 3.70% 2.74% 2.44%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD (000 OMITTED) $2,235,819 $2,135,884 $2,022,191 $1,806,918 $1,876,815 $2,390,663
RATIO OF EXPENSES TO AVERAGE NET ASSETS .20% A, D .20% D .20% D .19% D .18% A, D .18% D
RATIO OF NET INTEREST INCOME TO
AVERAGE NET ASSETS 3.46% A 3.54% 3.34% 3.64% 3.20% A 2.41%
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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
</TABLE>
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FINANCIAL HIGHLIGHTS - CLASS II
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 E
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
INCOME FROM INVESTMENT OPERATIONS
NET INTEREST INCOME .017 .034 .032 .013
LESS DISTRIBUTIONS
FROM NET INTEREST INCOME (.017) (.034) (.032) (.013)
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 1.68% 3.44% 3.25% 1.34%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD (000 OMITTED) $ 50,464 $ 30,829 $ 60,247 $ 968
RATIO OF EXPENSES TO AVERAGE NET ASSETS .36% A, D .35% D .35% D .35% A, D
RATIO OF NET INTEREST INCOME TO AVERAGE NET ASSETS 3.31% A 3.41% 3.21% 3.17% A
</TABLE>
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FINANCIAL HIGHLIGHTS - CLASS III
SIX MONTHS ENDED YEARS ENDED MARCH 31,
SEPTEMBER 30, 1998
SELECTED PER-SHARE DATA (UNAUDITED) 1998 1997 1996 F
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
INCOME FROM INVESTMENT OPERATIONS
NET INTEREST INCOME .016 .033 .031 .013
LESS DISTRIBUTIONS
FROM NET INTEREST INCOME (.016) (.033) (.031) (.013)
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B, C 1.63% 3.34% 3.14% 1.30%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD (000 OMITTED) $ 41,561 $ 37,272 $ 26,313 $ 988
RATIO OF EXPENSES TO AVERAGE NET ASSETS .45% A, D .45% D .45% D .45% A, D
RATIO OF NET INTEREST INCOME TO AVERAGE NET ASSETS 3.21% A 3.28% 3.09% 3.00% A
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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 (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD HAVE BEEN HIGHER
(SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
E FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS II SHARES) TO MARCH 31, 1996.
F FOR THE PERIOD NOVEMBER 6, 1995 (COMMENCEMENT OF SALE OF CLASS III SHARES) TO MARCH 31, 1996.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED SEPTEMBER 30, 1998 (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES.
Treasury Only Portfolio, Treasury Portfolio, Government Portfolio,
Domestic Portfolio, Rated Money Market Portfolio, Money Market
Portfolio and Tax-Exempt Portfolio (formerly Treasury Only, Treasury,
Government, Domestic, Rated Money Market, Money Market and Tax-Exempt,
respectively) (the funds) are funds of Colchester Street Trust
(formerly Fidelity Institutional Cash Portfolios for Treasury Only
Portfolio, Treasury Portfolio, Government Portfolio, Domestic
Portfolio and Money Market Portfolio; formerly Fidelity Money Market
Trust for Rated Money Market Portfolio and formerly Fidelity
Institutional Tax-Exempt Cash Portfolios for Tax-Exempt Portfolio)
(the trust). The trust is registered under the Investment Company Act
of 1940, as amended (the 1940 Act), as an open-end management
investment company organized as a Delaware business trust and is
authorized to issue an unlimited number of shares.
Each fund currently offers three classes of shares, Class I, Class II
and Class III, each of which has equal rights as to assets and voting
privileges except that each class bears different distribution and
transfer agent expenses and certain registration fees. Each class has
exclusive voting rights with respect to its distribution plans.
The financial statements have been prepared in conformity with
generally accepted accounting principles which require management to
make certain estimates and assumptions at the date of the financial
statements. The following summarizes the significant accounting
policies of the funds:
SECURITY VALUATION. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost
and thereafter assume a constant amortization to maturity of any
discount or premium.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for the fiscal year. The schedules of investments
include information regarding income taxes under the caption "Income
Tax Information."
INTEREST INCOME. Interest income, which includes amortization of
premium and accretion of discount, is accrued as earned. For
Tax-Exempt Portfolio, accretion of discount represents unrealized gain
until realized at the time of a security disposition or maturity.
ALLOCATED EARNINGS AND EXPENSES. Interest income, expenses (other than
expenses incurred under the Distribution and Service Plan, Transfer
Agent Agreement and certain registration fees for each class) and
realized and unrealized gains or losses on investments are allocated
to each class of shares based upon their relative net assets.
DEFERRED TRUSTEE COMPENSATION. Under a Deferred Compensation Plan (the
Plan) for Money Market Portfolio, non-interested Trustees must defer
receipt of a portion of, and may elect to defer receipt of an
additional portion of, their annual compensation. Deferred amounts are
treated as though equivalent dollar amounts had been invested in
shares of the fund or are invested in a cross-section of other
Fidelity money market funds. Deferred amounts remain in the fund until
distributed in accordance with the Plan.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income. Income dividends are declared
separately for each class.
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the funds, along with other
affiliated entities of Fidelity Management & Research Company (FMR),
may transfer uninvested cash balances into one or more joint trading
accounts. These balances are invested in one or more repurchase
agreements for U.S. Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
securities are transferred to an account of the funds, or to the Joint
Trading Account, at a bank custodian. The securities are
marked-to-market daily and maintained at a value at least equal to the
principal amount of the repurchase agreement (including accrued
interest). FMR, the funds' investment adviser, is responsible for
determining that the value of the underlying securities remains in
accordance with the market value requirements stated above.
RESTRICTED SECURITIES. Certain funds are permitted to invest in
securities that are subject to legal or contractual restrictions on
resale. These securities generally may be resold in transactions
exempt from registration or to the public if the securities are
registered. Disposal of these securities may involve time-consuming
negotiations and expense, and prompt sale at an acceptable price may
be difficult. Information regarding restricted securities is included
under the caption "Other Information" at the end of each applicable
fund's schedule of investments.
3. JOINT TRADING ACCOUNT.
At the end of the period, the following funds had 20% or more of their
total investments in repurchase agreements through a joint trading
account. These repurchase agreements were with entities whose
creditworthiness has been reviewed and found satisfactory by FMR. The
investments in repurchase agreements through the joint trading account
are summarized as follows:
SUMMARY OF JOINT TRADING
DATED SEPTEMBER 18, 1998, DUE DECEMBER 16, 1998 AT 5.29%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $500,000,000
Aggregate maturity amount of agreements $506,539,028
Aggregate market value of transferred assets $510,000,943
Coupon rates of transferred assets 0% to 5.63%
Maturity dates of transferred assets 10/15/98 to 5/15/01
3. JOINT TRADING ACCOUNT - CONTINUED
SUMMARY OF JOINT TRADING - CONTINUED
DATED SEPTEMBER 11, 1998, DUE DECEMBER 9, 1998 AT 5.36%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $180,000,000
Aggregate maturity amount of agreements $182,385,200
Aggregate market value of transferred assets $183,656,468
Coupon rates of transferred assets 0% to 8.75%
Maturity dates of transferred assets 12/31/98 to 5/15/17
DATED SEPTEMBER 10, 1998, DUE DECEMBER 9, 1998 AT 5.37%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $200,000,000
Aggregate maturity amount of agreements $202,685,000
Aggregate market value of transferred assets $204,062,742
Coupon rates of transferred assets 0% to 8.75%
Maturity dates of transferred assets 12/31/98 to 5/15/17
DATED SEPTEMBER 30, 1998, DUE OCTOBER 1, 1998 AT 5.44%
Number of dealers or banks 2
Maximum amount with one dealer or bank 88.1%
Aggregate principal amount of agreements $210,000,000
Aggregate maturity amount of agreements $210,031,740
Aggregate market value of transferred assets $214,339,140
Coupon rates of transferred assets 0% to 14.25%
Maturity dates of transferred assets 11/27/98 to 8/15/27
DATED SEPTEMBER 2, 1998, DUE FEBRUARY 10, 1999 AT 5.48%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $102,450,778
Aggregate market value of transferred assets $102,009,071
Coupon rates of transferred assets 6% to 7.07%
Maturity dates of transferred assets 2/1/26 to 9/1/37
DATED AUGUST 14, 1998, DUE NOVEMBER 5, 1998 AT 5.50%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $500,000,000
Aggregate maturity amount of agreements $504,621,528
Aggregate market value of transferred assets $510,156,856
Coupon rates of transferred assets 0% to 8.75%
Maturity dates of transferred assets 12/31/98 to 5/15/17
DATED AUGUST 14, 1998, DUE NOVEMBER 9, 1998 AT 5.50%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $300,000,000
Aggregate maturity amount of agreements $303,987,500
Aggregate market value of transferred assets $306,894,113
Coupon rates of transferred assets 0% to 8.75%
Maturity dates of transferred assets 12/31/98 to 5/15/17
DATED SEPTEMBER 3, 1998, DUE DECEMBER 2, 1998 AT 5.50%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $200,000,000
Aggregate maturity amount of agreements $202,750,000
Aggregate market value of transferred assets $205,081,142
Coupon rates of transferred assets 6% to 8.50%
Maturity dates of transferred assets 11/1/07 to 7/1/28
DATED SEPTEMBER 30, 1998, DUE OCTOBER 1, 1998 AT 5.52%
Number of dealers or banks 8
Maximum amount with one dealer or bank 25.8%
Aggregate principal amount of agreements $724,020,000
Aggregate maturity amount of agreements $724,131,022
Aggregate market value of transferred assets $748,963,691
Coupon rates of transferred assets 0% to 14.25%
Maturity dates of transferred assets 10/22/98 to 8/15/27
DATED SEPTEMBER 3, 1998, DUE NOVEMBER 9, 1998 AT 5.52%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $101,027,333
Aggregate market value of transferred assets $102,000,000
Coupon rates of transferred assets 6% to 7.61%
Maturity dates of transferred assets 9/1/13 to 8/1/37
DATED SEPTEMBER 17, 1998, DUE OCTOBER 20, 1998 AT 5.53%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $400,000,000
Aggregate maturity amount of agreements $402,027,667
Aggregate market value of transferred assets $408,000,000
Coupon rates of transferred assets 6% to 7.61%
Maturity dates of transferred assets 9/1/13 to 8/1/37
DATED SEPTEMBER 18, 1998, DUE OCTOBER 23, 1998 AT 5.53%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $200,000,000
Aggregate maturity amount of agreements $201,075,278
Aggregate market value of transferred assets $204,000,000
Coupon rates of transferred assets 6% to 7.61%
Maturity dates of transferred assets 9/1/13 to 8/1/37
DATED SEPTEMBER 30, 1998, DUE OCTOBER 1, 1998 AT 5.54%
Number of dealers or banks 20
Maximum amount with one dealer or bank 14.2%
Aggregate principal amount of agreements $7,304,826,000
Aggregate maturity amount of agreements $7,305,950,839
Aggregate market value of transferred assets $7,466,340,620
Coupon rates of transferred assets 0% to 14.25%
Maturity dates of transferred assets 10/22/98 to 11/15/27
3. JOINT TRADING ACCOUNT - CONTINUED
SUMMARY OF JOINT TRADING - CONTINUED
DATED SEPTEMBER 2, 1998, DUE OCTOBER 6, 1998 AT 5.55%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $100,524,167
Aggregate market value of transferred assets $102,536,433
Coupon rate of transferred assets 0%
Maturity dates of transferred assets 7/1/20 to 1/1/35
DATED AUGUST 20, 1998, DUE OCTOBER 19, 1998 AT 5.56%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $200,000,000
Aggregate maturity amount of agreements $201,853,333
Aggregate market value of transferred assets $205,893,869
Coupon rates of transferred assets 0% to 8%
Maturity dates of transferred assets 6/1/24 to 7/1/34
DATED AUGUST 27, 1998, DUE OCTOBER 27, 1998 AT 5.56%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $100,942,111
Aggregate market value of transferred assets $102,961,772
Coupon rate of transferred assets 0%
Maturity dates of transferred assets 7/1/25 to 8/1/37
DATED AUGUST 10, 1998, DUE NOVEMBER 9, 1998 AT 5.56%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $101,405,444
Aggregate market value of transferred assets $102,009,071
Coupon rates of transferred assets 6% to 7.07%
Maturity dates of transferred assets 2/1/26 to 9/1/37
DATED AUGUST 10, 1998, DUE NOVEMBER 9, 1998 AT 5.56%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $50,000,000
Aggregate maturity amount of agreements $50,702,722
Aggregate market value of transferred assets $51,224,698
Coupon rates of transferred assets 6.50% to 7.50%
Maturity dates of transferred assets 1/1/18 to 4/1/28
DATED AUGUST 11, 1998, DUE FEBRUARY 8, 1999 AT 5.57%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $102,800,472
Aggregate market value of transferred assets $102,413,811
Coupon rates of transferred assets 8.50% to 9%
Maturity dates of transferred assets 5/15/16 to 2/15/28
DATED JULY 31, 1998, DUE OCTOBER 13, 1998 AT 5.58%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $101,147,000
Aggregate market value of transferred assets $103,169,972
Coupon rate of transferred assets 0%
Maturity dates of transferred assets 7/1/25 to 9/1/35
DATED AUGUST 3, 1998, DUE JANUARY 13, 1999 AT 5.60%
Number of dealers or banks 1
Maximum amount with one dealer or bank 100%
Aggregate principal amount of agreements $100,000,000
Aggregate maturity amount of agreements $102,535,556
Aggregate market value of transferred assets $102,000,000
Coupon rates of transferred assets 6% to 7.61%
Maturity dates of transferred assets 9/1/13 to 8/1/37
DATED SEPTEMBER 30, 1998, DUE OCTOBER 1, 1998 AT 5.75%
Number of dealers or banks 5
Maximum amount with one dealer or bank 34.0%
Aggregate principal amount of agreements $1,363,167,000
Aggregate maturity amount of agreements $1,363,384,853
Aggregate market value of transferred assets $1,396,178,777
Coupon rates of transferred assets 0% to 14%
Maturity dates of transferred assets 3/1/00 to 6/1/35
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR receives a fee
that is computed daily at an annual rate of .20% of average net
assets.
SUB-ADVISER FEE. As each fund's investment sub-adviser, Fidelity
Investments Money Management, Inc., a wholly owned subsidiary of FMR,
receives a fee from FMR of 50% of the management fee payable to FMR.
The fees are paid prior to any voluntary expense reimbursements which
may be in effect.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and
Service Plans (the Plans) of Class II and Class III, and in accordance
with Rule 12b-1 of the 1940 Act, Class II and Class III pay Fidelity
Distributors Corporation (FDC), an affiliate of FMR, a distribution
and service fee that is based on an annual rate of .15% and .25% of
the average net assets, respectively. For the period, the distribution
fees received by FDC on behalf of each class are shown on each fund's
Statement of Operations. Of the fees paid to FDC by Class II of
Treasury Portfolio, Class II of Government Portfolio, Class III of
Treasury Only Portfolio, Class III of Treasury Portfolio, Class III of
Government Portfolio and Class III of Money Market Portfolio
approximately $7,000, $1,000, $3,000, $17,000, $14,000 and $4,000,
respectively, were retained by FDC. All of the fees paid to FDC by the
remaining classes were paid to security dealers, banks and other
financial institutions for selling Class II and Class III shares and
providing shareholder support services.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
DISTRIBUTION AND SERVICE PLAN - CONTINUED
Under the Plans of Class I, Class II, and Class III, FMR may use its
resources to pay administrative and promotional expenses related to
the sale of each fund's class of shares. Subject to the approval of
the Board of Trustees, the Plans also authorize FMR to pay FDC for
payments to third parties that assist in the sale of each class'
shares or render shareholder support services. For the period, FMR
made payments through FDC to third parties under the Plans of
approximately:
CLASS I CLASS II CLASS III
Treasury Only Portfolio $ 46,000 $ 1,000 $ 2,000
Treasury Portfolio $ 30,000 $ 1,000 $ 10,000
Government Portfolio $ 30,000 $ 1,000 $ 29,000
Domestic Portfolio $ 5,000 $ - $ 1,000
Rated Money Market
Portfolio $ - $ - $ -
Money Market Portfolio $ 36,000 $ 2,000 $ 11,000
Tax-Exempt Portfolio $ 9,000 $ 1,000 $ 1,000
TRANSFER AGENT FEES. Fidelity Investments Institutional Operations
Company, Inc. (FIIOC), an affiliate of FMR, is the transfer, dividend
disbursing and shareholder servicing agent for the funds except for
Tax-Exempt Portfolio. UMB Bank, n.a. (UMB) is the custodian, transfer
and shareholder servicing agent for Tax-Exempt Portfolio. UMB has
entered into a sub-contract with FIIOC to perform the activities
associated with the transfer and shareholder servicing agent functions
for Tax-Exempt Portfolio. FIIOC receives account fees and asset-based
fees that vary according to account size. FIIOC pays for typesetting,
printing and mailing of all shareholder reports, except proxy
statements.
For the period, the transfer agent fees were equivalent to the
following annualized rates as a percentage of average net assets:
CLASS I CLASS II CLASS III
Treasury Only Portfolio .03% .03% .03%
Treasury Portfolio .03% .03% .03%
Government Portfolio .02% .03% .03%
Domestic Portfolio .02% .04% .03%
Rated Money Market
Portfolio .04% .00% .01%
Money Market Portfolio .02% .03% .03%
Tax-Exempt Portfolio .02% .03% .03%
ACCOUNTING FEES. Fidelity Service Company, Inc. (FSC), an affiliate of
FMR, maintains the accounting records for the funds except for
Tax-Exempt Portfolio. UMB also has a sub-contract
with FSC to maintain Tax-Exempt Portfolio's accounting records. The
accounting fee is based on the level of average net assets for the
month plus out-of-pocket expenses.
5. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the funds' operating expenses
(excluding interest, taxes, brokerage commissions, extraordinary
expenses, and 12b-1 fees payable by Class II and Class III of each
fund) above an annual rate of .20% (.18% for Money Market Portfolio)
of average net assets. For the period, the reimbursement reduced
expenses by the following:
CLASS I CLASS II CLASS III
Treasury Only Portfolio $ 252,058 $ 17,343 $ 27,259
Treasury Portfolio $ 933,615 $ 89,821 $ 763,387
Government Portfolio $ 984,662 $ 71,552 $ 195,996
Domestic Portfolio $ 245,552 $ 17,316 $ 35,670
Rated Money Market
Portfolio $ 158,679 $ 35,078 $ 45,253
Money Market
Portfolio $ 2,852,106 $ 60,172 $ 172,153
Tax-Exempt Portfolio $ 574,108 $ 15,821 $ 18,385
In addition, certain funds have entered into an arrangement with their
custodian whereby credits realized as a result of uninvested cash
balances were used to reduce a portion of each applicable fund's
expenses. During the period, custodian fees were reduced by $28,441
under the custodian arrangement for Tax-Exempt Portfolio.
6. BENEFICIAL INTEREST.
At the end of the period, certain shareholders were record owners of
approximately 10% or more of the total outstanding shares of the
following funds:
BENEFICIAL INTEREST
FUND NUMBER OF SHAREHOLDERS % OWNERSHIP
Treasury Only Portfolio 3 40%
Treasury Portfolio 1 32%
Government Portfolio 1 15%
Rated Money Market Portfolio 1 14%
Tax-Exempt Portfolio 1 15%
7. SHARE TRANSACTIONS.
Share transactions for each class of shares were as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, MARCH 31,
1998 1998
TREASURY ONLY PORTFOLIO CLASS I $ 1,348,410,072 $ 3,763,808,828
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 6,364,005 12,396,796
SHARES REDEEMED (1,372,641,019) (3,990,429,016)
NET INCREASE (DECREASE) $ (17,866,942) $ (214,223,392)
TREASURY ONLY PORTFOLIO CLASS II $ 121,241,050 $ 353,599,058
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 717,065 1,098,235
SHARES REDEEMED (108,042,481) (374,357,881)
NET INCREASE (DECREASE) $ 13,915,634 $ (19,660,588)
TREASURY ONLY PORTFOLIO CLASS III $ 213,518,058 $ 458,981,861
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 1,136,356 1,415,477
SHARES REDEEMED (234,538,614) (395,939,453)
NET INCREASE (DECREASE) $ (19,884,200) $ 64,457,885
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
TREASURY PORTFOLIO CLASS I $ 32,514,629,231 $ 56,382,827,620
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 50,170,219 104,974,998
SHARES REDEEMED (32,417,010,927) (57,587,789,160)
NET INCREASE (DECREASE) $ 147,788,523 $ (1,099,986,542)
TREASURY PORTFOLIO CLASS II $ 2,609,783,813 $ 11,473,941,319
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 2,111,179 3,111,085
SHARES REDEEMED (2,668,465,817) (11,156,445,957)
NET INCREASE (DECREASE) $ (56,570,825) $ 320,606,447
TREASURY PORTFOLIO CLASS III $ 18,365,705,763 $ 31,755,413,322
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 16,854,240 37,736,905
SHARES REDEEMED (17,128,402,761) (32,418,433,085)
NET INCREASE (DECREASE) $ 1,254,157,242 $ (625,282,858)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
GOVERNMENT PORTFOLIO CLASS I $ 16,451,261,809 $ 32,090,184,246
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 45,838,086 77,830,952
SHARES REDEEMED (16,038,165,973) (31,450,409,491)
NET INCREASE (DECREASE) $ 458,933,922 $ 717,605,707
GOVERNMENT PORTFOLIO CLASS II $ 1,402,053,759 $ 2,201,077,655
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 3,513,766 3,539,770
SHARES REDEEMED (1,376,401,227) (2,161,302,172)
NET INCREASE (DECREASE) $ 29,166,298 $ 43,315,253
GOVERNMENT PORTFOLIO CLASS III $ 4,477,570,995 $ 8,833,518,097
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 12,404,834 28,319,356
SHARES REDEEMED (4,570,273,554) (8,846,243,887)
NET INCREASE (DECREASE) $ (80,297,725) $ 15,593,566
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
7. SHARE TRANSACTIONS - CONTINUED
SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, MARCH 31,
1998 1998
DOMESTIC PORTFOLIO CLASS I $ 5,572,690,393 $ 13,489,220,102
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 18,448,348 35,344,269
SHARES REDEEMED (5,636,300,648) (13,273,276,636)
NET INCREASE (DECREASE) $ (45,161,907) $ 251,287,735
DOMESTIC PORTFOLIO CLASS II $ 446,137,009 $ 289,381,235
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 945,511 374,388
SHARES REDEEMED (435,076,047) (259,533,241)
NET INCREASE (DECREASE) $ 12,006,473 $ 30,222,382
DOMESTIC PORTFOLIO CLASS III $ 405,519,448 $ 807,974,724
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 1,908,669 2,910,394
SHARES REDEEMED (375,047,398) (859,302,969)
NET INCREASE (DECREASE) $ 32,380,719 $ (48,417,851)
RATED MONEY MARKET PORTFOLIO CLASS I $ 1,196,980,506 $ 2,739,637,975
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 7,802,106 15,109,212
SHARES REDEEMED (1,231,004,727) (2,763,814,126)
NET INCREASE (DECREASE) $ (26,222,115) $ (9,066,939)
RATED MONEY MARKET PORTFOLIO CLASS II $ 393,721,168 $ 478,273,085
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 1,680,732 1,451,336
SHARES REDEEMED (294,173,231) (470,566,779)
NET INCREASE (DECREASE) $ 101,228,669 $ 9,157,642
RATED MONEY MARKET PORTFOLIO CLASS III $ 1,063,538,589 $ 527,119,170
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 3,004,476 2,304,718
SHARES REDEEMED (976,036,411) (470,679,681)
NET INCREASE (DECREASE) $ 90,506,654 $ 58,744,207
MONEY MARKET PORTFOLIO CLASS I $ 40,348,957,061 $ 65,588,662,837
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 190,862,991 336,986,110
SHARES REDEEMED (40,051,067,716) (65,255,552,989)
NET INCREASE (DECREASE) $ 488,752,336 $ 670,095,958
MONEY MARKET PORTFOLIO CLASS II $ 739,509,651 $ 1,181,841,213
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 3,708,258 4,744,814
SHARES REDEEMED (583,626,340) (1,268,195,640)
NET INCREASE (DECREASE) $ 159,591,569 $ (81,609,613)
MONEY MARKET PORTFOLIO CLASS III $ 2,045,624,881 $ 4,398,573,161
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 11,026,845 22,812,626
SHARES REDEEMED (2,067,526,258) (4,377,611,537)
NET INCREASE (DECREASE) $ (10,874,532) $ 43,774,250
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
7. SHARE TRANSACTIONS - CONTINUED
SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, MARCH 31,
1998 1998
TAX-EXEMPT PORTFOLIO CLASS I $ 5,176,120,208 $ 11,327,645,715
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 9,847,737 20,424,015
SHARES REDEEMED (5,086,021,961) (11,234,512,567)
NET INCREASE (DECREASE) $ 99,945,984 $ 113,557,163
TAX-EXEMPT PORTFOLIO CLASS II $ 189,768,346 $ 370,381,704
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 590,286 1,356,603
SHARES REDEEMED (170,721,469) (401,163,706)
NET INCREASE (DECREASE) $ 19,637,163 $ (29,425,399)
TAX-EXEMPT PORTFOLIO CLASS III $ 89,084,783 $ 164,781,646
SHARES SOLD
REINVESTMENT OF DISTRIBUTIONS FROM NET INTEREST INCOME 628,439 1,159,670
SHARES REDEEMED (85,423,218) (154,982,703)
NET INCREASE (DECREASE) $ 4,290,004 $ 10,958,613
</TABLE>
8. PROPOSED REORGANIZATION.
The Board of Trustees has approved Agreements and Plans of
Reorganization ("Agreements") between Domestic Portfolio ("Acquiring
Fund") and Rated Money Market Portfolio ("Target Fund")
("Reorganization"). The Agreements provide for the transfer of all of
the assets of the Target Fund to the Acquiring Fund in exchange solely
for the number of shares of the Acquiring Fund equal in number to the
outstanding shares of the Target Fund as of the close of business of
the New York Stock Exchange on the day that the Reorganization is
effective. The Agreements also provide for the assumption by the
Acquiring Fund of all of the liabilities of the Target Fund. A
Reorganization can be consummated only if, among other things, it is
approved by the vote of a majority (as defined by the 1940 Act) of
outstanding voting securities of the Target Fund to which the
Reorganization relates. A Special Meeting of Shareholders ("Meeting")
of the Target Fund will be held on December 16, 1998 to vote on the
Agreements. A detailed description of the proposed transactions and
voting information was sent to shareholders of the Target Fund in
October 1998. If the Agreements are approved at the Meeting, the
Reorganization is expected to become effective on or about January 21,
1999.
Effective October 19, 1998, shares of Rated Money Market Portfolio are
no longer available for purchase or exchange to new accounts of the
fund pending the proposed Reorganization. However, existing
shareholders of the fund can continue to purchase shares of the fund.
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston MA
INVESTMENT SUB-ADVISER
Fidelity Investments Money Management, Inc.
Merrimack, NH
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Boyce I. Greer, Vice President
Fred L. Henning, Jr., Vice President
Robert K. Duby, Vice President - MONEY MARKET PORTFOLIO
Robert A. Litterest, Vice President - GOVERNMENT PORTFOLIO,
TREASURY ONLY PORTFOLIO AND TREASURY PORTFOLIO
Scott A. Orr, Vice President - TAX-EXEMPT PORTFOLIO
John J. Todd, Vice President - DOMESTIC PORTFOLIO AND
RATED MONEY MARKET PORTFOLIO
Eric D. Roiter, Secretary
Richard A. Silver, Treasurer
Stanley N. Griffith, Assistant Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
* INDEPENDENT TRUSTEES
FIMM-SANN-1198 64699
1.537280.101
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
Fidelity Investments Institutional Operations Company, Inc.
Boston, MA
TREASURY ONLY PORTFOLIO, TREASURY PORTFOLIO,
GOVERNMENT PORTFOLIO, DOMESTIC PORTFOLIO,
MONEY MARKET PORTFOLIO AND RATED MONEY MARKET PORTFOLIO
UMB Bank, n.a.
Kansas City, MO
TAX-EXEMPT PORTFOLIO
CUSTODIANS
The Bank of New York
New York, NY
TREASURY ONLY PORTFOLIO, TREASURY PORTFOLIO,
GOVERNMENT PORTFOLIO, DOMESTIC PORTFOLIO,
MONEY MARKET PORTFOLIO AND RATED MONEY MARKET PORTFOLIO
UMB Bank, n.a.
Kansas City, MO
TAX-EXEMPT PORTFOLIO
(FIDELITY_LOGO_GRAPHIC) Fidelity Investments (Registered Trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com
