SPARTAN(registered trademark)
(registered trademark)
MASSACHUSETTS
MUNICIPAL
MONEY MARKET
PORTFOLIO
ANNUAL REPORT
JANUARY 31, 1995
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 6 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 8 A summary of major shifts in the
fund's investments over the past six
months
and one year.
INVESTMENTS 9 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 14 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 18 Notes to the financial statements.
REPORT OF INDEPENDENT
ACCOUNTANTS 19 The auditor's opinion.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE
PROSPECTUS. MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED BY, ANY
DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, THE FEDERAL
RESERVE BOARD OR
ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISK, INCLUDING THE
POSSIBLE LOSS OF
PRINCIPAL. NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A
BANK. FOR MORE
INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES, CALL
1-800-544-8888
FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
Although there have been a few positive market indications so far in 1995,
no one can predict what lies ahead for investors. Last year, stocks posted
below-average returns and bonds had one of the worst years in history. This
downturn followed a period in which the investing environment was almost
ideal.
These market ups and downs are a normal part of investing, and there are
some basic principles that can help investors in every type of market.
First, take a long-term approach when investing. If you can afford to leave
your money invested through the inevitable ups and downs of financial
markets, you will greatly reduce your vulnerability to any single decline.
Over time, for example, stock prices have gone up - and have significantly
outperformed other types of investments and stayed ahead of inflation.
Second, you can further manage risk by diversifying your investments. A
stock mutual fund is already diversified, because it invests in many
different companies. You can increase your diversification by investing in
a number of different stock funds, or in different investment categories,
such as bonds. You should also keep money you'll need in the near future in
a more stable investment.
Finally, it makes good sense to follow a regular investment plan, investing
a set amount of money at the same time each month or quarter. That way, you
can avoid getting caught up in the excitement of a rapidly-rising market -
and won't end up buying all your shares at market highs. This strategy
won't assure a profit or protect you from a loss in a declining market, but
it should help you lower the average cost of your purchases. For this to be
effective, you must continue to buy shares in both up and down markets.
If you have questions, please call us at 1-800-544-8888. We would be happy
to send you a Fidelity FundMatch kit, which can help you determine the mix
of investments that is right for you. You might also find it convenient to
set up a regular investment plan using the Fidelity Automatic Account
Builder.SM
We look forward to hearing from you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
To measure a money market fund's performance, you can look at either total
return or yield. Total return reflects the change in a fund's share price
over a given period, reinvestment of its dividends (or income), and the
effect of the fund's $5 account closeout fee. Yield measures the income
paid by a fund. Since a money market fund tries to maintain a $1 share
price, yield is an important measure of performance. If Fidelity had not
reimbursed certain fund expenses during the periods shown, the total
returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1995 PAST 1 LIFE OF
YEAR FUND
Spartan Massachusetts
Municipal Money Market Portfolio 2.42% 11.22%
Average Massachusetts
Tax-Free Money Market Fund 2.36% 10.05%
Consumer Price Index 2.80% 11.50%
CUMULATIVE TOTAL RETURNS reflect actual performance over a specific period
- in this case, one year, or since the fund started on March 4, 1991. For
example, if you invested $1,000 in a fund that had a 5% return over the
past year, you would end up with $1,050. To measure how the fund stacked up
against its peers, you can compare its return to the average Massachusetts
tax-free money market fund's total return. This average currently reflects
the performance of just 11 Massachusetts tax-free money market funds
tracked by IBC/Donoghue. Comparing the fund's performance to the consumer
price index (CPI) helps show how your investment did compared to inflation.
(The periods covered by the CPI and IBC/Donoghue numbers are the closest
available match to those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1995 PAST 1 LIFE OF
YEAR FUND
Spartan Massachusetts
Municipal Money Market Portfolio 2.42% 2.75%
Average Massachusetts
Tax-Free Money Market Fund 2.36% 2.52%
Consumer Price Index 2.80% 2.81%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
1/31/94 4/30/94 7/31/94 10/31/94 1/31/95
Spartan Massachusetts 1.83% 2.30% 2.27% 2.77% 3.01%
Municipal Money Market
Portfolio
Average Massachusetts 1.70% 2.25% 2.31% 2.73% 2.95%
Tax-Free Money Market
Fund
Spartan Massachusetts 3.24% 4.08% 4.02% 4.89% 5.34%
Municipal Money Market
Fund - Tax-equivalent
Portion of fund's income 1.00% 1.50% 2.10% 4.60% -
subject to state taxes on last
day of period
Average All Taxable 2.68% 3.15% 3.83% 4.40% 5.23%
Money Market Fund
</TABLE>
YIELD refers to the income paid by the fund over a given period. Yields for
money market funds are usually for seven-day periods, expressed as annual
percentage rates. A yield that assumes income earned is reinvested or
compounded is called an effective yield. The chart above shows the fund's
current seven-day yield at quarterly intervals over the past year. You can
compare these yields to the average Massachusetts tax-free money market
fund. Or you can look at the fund's tax-equivalent yield, which is based on
a combined effective 1995 federal and state income tax rate of 43.68% and
reflects that a portion of the fund's income may have been subject to state
taxes. The tax-equivalent figures are useful in seeing how the fund stacked
up against the average taxable money market fund as tracked by
IBC/Donoghue. A portion of the fund's income may be subject to the
alternative minimum tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT PAST
RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
Yields on tax-free
investments are usually lower
than yields on taxable
investments. However, a
straight comparison between
the two may be misleading
because it ignores the way
taxes reduce taxable returns.
Tax-equivalent yield - the
yield you'd have to earn on a
similar taxable investment to
match the tax-free yield -
makes the comparison more
meaningful. Keep in mind that
the U.S. government neither
insures nor guarantees a
money market fund. In fact,
there is no assurance that a
money market fund will
maintain a $1 share price.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
An interview with Janice Bradburn, Portfolio Manager of Spartan
Massachusetts Municipal Money Market Portfolio
Q. JAN, MONEY MARKET INTEREST RATES HAVE RISEN DRAMATICALLY OVER THE PAST
YEAR. CAN YOU BRING US UP TO DATE?
A. Sure. A year ago, the federal funds rate - what banks charge each other
for overnight loans - was at 3%, where it had been for some time. Then on
February 4, 1994, the Federal Reserve made a preemptive strike against
inflation, raising the federal funds rate one-quarter percentage point to
3.25%. I use the word preemptive because at the time there was very little
concrete evidence of inflation, only what seemed - to the Fed, at least -
to be a growing threat. Two more quarter-point increases followed in March
and April, two half-point increases in May and August, and finally a
three-quarter-point increase in November. The federal funds rate ended the
period at 5.50%. I should point out that on February 1, 1995 - one day
after the period ended - the Fed raised the federal funds rate another
one-half percentage point to 6.00%.
Q. WHAT WAS YOUR STRATEGY IN THE FACE OF RISING RATES?
A. Ordinarily when rates are rising, I try to shorten the fund's average
maturity. That way, as the fund's securities roll over, I can replace them
with higher-yielding securities and seek to keep pace with rising rates. In
a nutshell, that was my strategy during most of 1994. In January 1994, at
the beginning of the period, the fund's average maturity was around 60
days. I let it roll down to around 40 days by the end of February, and on
down into the low 20s by mid-summer. One way I did that was by adding
variable rate demand notes. VRDNs have rates that reset at daily, weekly or
monthly intervals. Then as Massachusetts entered its annual borrowing
season and the heavy supply of new issues propped up rates, I extended the
fund slightly out past 30 days, and kept it there during the final months
of the period. By the end of January 1995, the fund's average maturity was
30 days.
Q. HOW DID THE FUND PERFORM?
A. On January 31, 1995, the fund's seven-day yield was 3.01%, compared to
1.83% a year earlier, reflecting the dramatic rise in short-term interest
rates during the period. The fund's latest yield was the equivalent of a
5.34% taxable yield for Massachusetts investors in the 43.68% combined
state and federal tax bracket. The fund's total return for the year ended
January 31, 1995 was 2.42%. That beat the average total return of 2.36% for
all Massachusetts tax-free money market funds during the same period,
according to IBC/Donoghue.
Q. WHAT CAN WE EXPECT IN THE MONTHS AHEAD?
A. Almost everybody agrees that short-term rates are likely to move still
higher in the months ahead, despite the fact that inflation has so far
remained modest. But the lesson we all learned last year is that the Fed is
determined to stifle inflation before it becomes a problem. Therefore, as
long as the economic growth rate remains above the Fed's target rate of
2.5%, we probably can expect the federal funds rate to keep rising. With
that in mind, I'll likely try to keep the fund's average maturity in the
neutral to defensive range - or around 30 to 40 days - for the foreseeable
future.
FUND FACTS
GOAL: tax-free income and
stability by investing in
high-quality, short-term
Massachusetts municipal
securities
START DATE: March 4, 1991
SIZE: as of January 31, 1995
more than $406 million
MANAGER: Janice Bradburn,
since January 1992; manager,
Fidelity Ohio Municipal Money
Market Portfolio, since October
1993; Fidelity Massachusetts
Municipal Money Market
Portfolio, since 1992; Fidelity
New York Tax-Free Money
Market Portfolio, since
September 1989; Spartan New
York Municipal Money Market
Portfolio, since 1990; joined
Fidelity in 1989
(checkmark)
WORDS TO KNOW
COMMERCIAL PAPER: A security
issued by a municipality to
finance capital or operating
needs.
FEDERAL FUNDS RATE: The interest
rate banks charge each other
for overnight loans.
MATURITY: The time remaining
before an issuer is scheduled
to repay the principal amount
on a debt security. When the
fund's average maturity -
weighted by dollar amount -
is short, the fund manager is
anticipating a rise in interest
rates. When the average
maturity is long, the manager
is expecting rates to fall.
When the average maturity is
neutral, the manager wants
the flexibility to respond to
rising rates, while still
capturing a portion of the
higher yields available from
issues with longer maturities.
MUNICIPAL NOTE: A security
issued in advance of future
tax or other revenues and
payable from those specific
sources.
TENDER BOND: A variable-rate,
long-term security that gives
the bond holder the option to
redeem the bond at face
value before maturity.
VARIABLE RATE DEMAND NOTE
(VRDN): A tender bond that
can be redeemed on short
notice, typically one or seven
days. VRDNs are useful in
managing the fund's average
maturity and liquidity.
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
1/31/95 7/31/94 1/31/94
0 - 30 82 83 70
31 - 90 5 12 4
91 - 180 11 3 12
181 - 397 2 2 14
WEIGHTED AVERAGE MATURITY
1/31/95 7/31/94 1/31/94
Spartan Massachusetts
Municipal Money Market
Portfolio 30 days 23 days 60 days
Average Massachusetts
Tax-Free Money 34 days 33 days 56 days
Market Fund*
ASSET ALLOCATION
AS OF JANUARY 31, 1995 AS OF JULY 31, 1994
Row: 1, Col: 1, Value: 67.0
Row: 1, Col: 2, Value: 14.0
Row: 1, Col: 3, Value: 5.0
Row: 1, Col: 4, Value: 11.0
Row: 1, Col: 5, Value: 3.0
Row: 1, Col: 1, Value: 71.0
Row: 1, Col: 2, Value: 4.0
Row: 1, Col: 3, Value: 13.0
Row: 1, Col: 4, Value: 9.0
Row: 1, Col: 5, Value: 3.0
Variable rate
demand notes
(VRDNs) 67%
Commercial
paper 14%
Tender bonds 5%
Municipal
notes 11%
Other 3%
Variable rate
demand notes
(VRDNs) 71%
Commercial
paper 4%
Tender bonds 13%
Municipal
notes 9%
Other 3%
* SOURCE: IBC/DONOGHUE'S MONEY FUND REPORT(registered trademark)
INVESTMENTS JANUARY 31, 1995
Showing Percentage of Total Value of Investments
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 96.0%
Boston City Hosp. Participating VRDN, Series PT2, 3.70%
(Liquidity Facility Bank National De Paris) (c) $ 1,700,000 $ 1,700,000
Boston Gen. Oblig. Participating VRDN (c):
Series 6 A, 4.25%
(Liquidity Facility Morgan Guaranty) 2,400,000 2,400,000
Series 6 C, 4.25%
(Liquidity Facility Morgan Guaranty) 1,800,000 1,800,000
Boston Wtr. & Swr. Commission Gen. Rev. VRDN:
Series 1985 A, 2.65%, LOC Canadian
Imperial Bank of Commerce 13,640,000 13,640,000
Series 1994 A, 3.65%, LOC State Street Bank & Trust 4,000,000 4,000,000
Brockton RAN 5.50% BPA Fleet Bank 1,000,000 1,002,136
Chelmsford BAN 3.80%, 3/23/95 1,000,000 1,000,202
Clipper Participating VRDN, Series 93-2, 2.91%
(Liquidity Facility State Street Bank & Trust) (c) 15,630,200 15,630,200
Holyoke Poll. Cont. Rev. (Holyoke Pwr. & Light Proj.)
Series 1988, 3.35%,
LOC Union Bank of Switzerland, VRDN 3,400,000 3,400,000
Hopkinton BAN 4.25% 7/6/95 1,000,000 1,000,824
Lincoln BAN 4% 7/6/95 2,500,000 2,503,068
Lowell BAN 4.625% 3/1/95,
LOC State Street Bank & Trust 2,000,000 2,001,829
Massachusetts Bay Trans. Auth. CP, Series A:
3.60% 2/28/95, LOC ABN-AMRO Bank 2,000,000 2,000,000
4.05% 4/7/95, LOC ABN-AMRO Bank 2,900,000 2,900,000
4.10% 4/10/95, LOC ABN-AMRO Bank 1,000,000 1,000,000
Massachusetts Bay Trans. Auth. RAN
Series 1994 A, 3.75% 3/1/95 3,200,000 3,200,487
Massachusetts Dedicated Income Tax Rev.
(First Recovery Loan), VRDN :
Series 1990 B, 3.80%,
LOC Nat'l. Westminster 2,000,000 2,000,000
Series 1990 D, 3.80%,
LOC ABN-Amro Bank 2,800,000 2,800,000
Massachusetts Ed. Fin. Auth. Ed. Loan Rev. Issue E
Series 1994 A, 3.35%, VRDN (b) 3,000,000 3,000,000
Massachusetts Gen. Oblig. BAN, Series 1994 A,
5% 6/15/95 19,200,000 19,252,393
Massachusetts Gen. Oblig. Bond, Series 1994 B,
5% 8/1/95 2,495,000 2,508,197
Massachusetts Gen. Oblig. Participating VRDN (c):
Series 93 A, 3.81% (Liquidity Facility Citibank) 4,000,000 4,000,000
Series 93 I, 3.81% (Liquidity Facility Citibank) 7,800,000 7,800,000
Massachusetts Gen. Oblig. Tender Option Ctfs.
Series CR-147, 3.81%
(Liquidity Facility Citibank) (c) 3,000,000 3,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Edl. Facs. Auth. Rev.:
(Boston Childrens Hosp.) 3.35% BPA Sanwa Bank,
VRDN $ 3,300,000 $ 3,300,000
(Boston Univ.) Bonds Series G, 8.875% 7/1/95 2,500,000 2,582,403
(Brigham & Women's Hosp.) Series A, 3.25%,
LOC Sanwa Bank, VRDN 6,500,000 6,500,000
(Cap. Asset Prog.) VRDN:
Series 1985 D, 3.30%, (MBIA Insured)
BPA Sanwa Bank 15,200,000 15,200,000
Series A, 3.40%, LOC First Nat'l. Bank of Chicago 8,400,000 8,400,000
Series E, 3.35%, LOC Sanwa Bank 9,300,000 9,300,000
Series G1, 3.20%, (MBIA Insured)
BPA Credit Suisse 1,800,000 1,800,000
(Harvard Univ.):
Bonds:
3.60% tender 2/13/95 5,900,000 5,900,000
4.25% tender 2/22/95 2,000,000 2,000,000
3.60% tender 3/8/95 2,000,000 2,000,000
Series I (16), 3.35%, VRDN 26,151,000 26,151,000
Series I (17), 3.35%, VRDN 31,690,000 31,690,000
(Holy Cross College) Bonds Series F, 8.35% 5/1/95 500,000 515,181
(MIT) Series G, 3.35%, VRDN 8,000,000 8,000,000
(Wellesley College) Series E, 3.25%, VRDN 4,600,000 4,600,000
(Williams College), 3.50%, VRDN 2,000,000 2,000,000
Massachusetts Hsg. Fin. Agcy. Participating VRDN, (c):
Series 13C, 4.25% (Liquidity Facility Morgan
Guaranty) 3,600,000 3,600,000
Series PT-33, 3.85% (Liquidity Facility Industrial
Bank of Japan) (b) 1,500,000 1,500,000
Massachusetts Hsg. Fin. Agcy. Single Family Hsg. Rev. Bonds
Series 25, 4.10% tender 6/1/95 12,110,000 12,110,000
Massachusetts Ind. Fin. Agcy. Adj. Rate Rev. Rfdg.
(WGBH Ed. Foundation Proj.) Series 1992, 3.65%,
LOC Nat'l. Westminster Bank, VRDN 2,510,000 2,510,000
Massachusetts Ind. Fin. Agcy. Adj. Tender Resource
Recovery Rev. (Ogden-Haverhill Proj.) Series 1986 B,
3.30%, LOC Union Bank of Switzerland, VRDN (b) 7,750,000 7,750,000
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev., VRDN:
Rfdg. (First Healthcare Corp. Proj.) Series 1992 B, 3.75%,
LOC Wachovia Bank of Georgia 1,130,000 1,130,000
Rfdg. (First Healthcare Corp. for Hillhaven Proj.) 3.75%,
LOC Wachovia Bank of Georgia 1,195,000 1,195,000
Rfdg. (Quamco Inc. Proj.):
Series 1988 A, 3.25%, LOC Bank of Nova Scotia 655,000 655,000
Series 1988 B, 3.25%, LOC Bank of Nova Scotia 845,000 845,000
(Manhasset Bay-Cambridge) Series 1985, 3.45%,
LOC Bank of Tokyo 3,900,000 3,900,000
(United Medical Corp.) Series 1992, 3.70%,
LOC Chemical Bank (b) 1,400,000 1,400,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev.
(Holyoke Wtr. & Pwr. Co. Proj.) Series 1990, VRDN:
3.35%, LOC Canadian Imperial Bank of Commerce $ 1,400,000 $ 1,400,000
3.75%, LOC Swiss Bank (b) 2,600,000 2,600,000
Massachusetts Ind. Fin. Agcy. Resource Recovery Rev.
(Ogden-Haverhill Proj.) Series 1992 A, 3.25%,
LOC Union Bank of Switzerland, VRDN 7,195,000 7,195,000
Massachusetts Ind. Fin. Agcy. Rev.:
Bonds (St. Mark's School of Southborough) Issue 1991,
5.25% tender 1/9/96 LOC Barclays Bank 1,000,000 1,000,000
(General Signal Proj.) 3.40%,
LOC Wachovia Bank of Georgia, VRDN 3,000,000 3,000,000
(New England Deaconess Assoc.) Series 1993 B, 3.30%,
LOC Banque Paribas, VRDN 1,000,000 1,000,000
(Mary Ann Morse Nursing Home), VRDN:
Series B, 3.40%, LOC ABN-AMRO Bank 4,600,000 4,600,000
Series A, 3.80%, LOC ABN-AMRO Bank 3,300,000 3,300,000
(Tsubaki Inc.) 3.95%, LOC Sakura Bank, VRDN (b) 1,700,000 1,700,000
Massachusetts Ind. Fin. Agcy. Rev. Rfdg.
(Showa Women's Institute Boston Inc. 1994 Proj.) 3.95%
LOC Fuji Bank, VRDN 2,800,000 2,800,000
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev.:
Rfdg. (New England Pwr. Co. Proj.):
Series 1992 B:
3.70% tender 2/8/95 3,000,000 3,000,000
3.80% tender 2/10/95 4,000,000 4,000,000
3.75% tender 2/13/95 6,000,000 6,000,000
3.75% tender 2/17/95 6,000,000 6,000,000
4.30% tender 2/22/95 2,500,000 2,500,000
4.15% tender 2/27/95 2,000,000 2,000,000
4.05% tender 4/11/95 1,500,000 1,500,000
4.00% tender 4/12/95 3,500,000 3,500,000
Series 1993 A, 3.75% tender 3/16/95 5,800,000 5,800,000
Series 1993 B, 3.90% tender 2/28/95 2,000,000 2,000,000
Massachusetts Muni. Elec. Wholesale Co. Pwr. Supply
Sys. Rev. Series 1994 C, 3.50%
LOC Canadian Imperial Bank, VRDN 15,000,000 15,000,000
Massachusetts Muni. Elec. Wholesale Supply Sys.
Participating VRDN, Series GS-93D, 3.75%,
(Liquidity Facility Hong Kong & Shanghai
Banking Corp.) (c) 3,800,000 3,800,000
Massachusetts Port Auth. Rev. Bonds Series A,
7.75% 7/1/95 (b) 970,000 1,002,493
Massachusetts Single Family Hsg. Auth. Rev. Bonds
3.95% tender 3/1/95 (Liquidity Facility
Citibank) (b) (c) 6,000,000 6,000,000
Massachusetts Spl. Oblig. Rev. Series A, 4.50%
6/1/95 1,000,000 1,001,742
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Tpk. Auth. Participating VRDN,
Series PA-1009, 3.75%
(Liquidity Facility Merrill Lynch & Co.) $ 3,360,000 $ 3,360,000
Massachusetts Wtr. Resources Auth. CP, 3.50% 2/17/95,
LOC Morgan Guaranty Trust 3,000,000 3,000,000
Massachusetts Wtr. Resources Auth. Gen. Oblig. Bond
Series A, 7.625% 8/1/95 (MBIA Insured) 1,000,000 1,018,178
Massachusetts Wtr. Resources Auth. Participating VRDN (c):
3.85% (Liquidity Facility Dai-Ichi Kangyo) 1,525,000 1,525,000
Series 1994 PW11, 3.70%
(Liquidity Facility Bank of Nova Scotia) 2,000,000 2,000,000
Somerville BAN 4.40% 7/28/95 1,000,000 1,000,472
South Essex Sewage Dist. Bond Series B, 4.10% 6/1/95
(MBIA Insured) 575,000 575,000
Springfield RAN 4.65% 2/23/95 BPA Fleet Bank 1,000,000 1,000,446
Westfield BAN 5% 6/28/95 2,050,000 2,051,995
Worcester BAN:
Lot A, 4.25% 2/15/95, LOC State Street Bank 5,000,000 5,001,260
Lot B, 4.50% 2/15/95, LOC State Street Bank &
Trust (b) 1,245,000 1,245,407
5% 8/31/95, LOC Sanwa Bank 4,168,000 4,177,365
387,727,278
PUERTO RICO - 4.0%
Puerto Rico Elec. Pwr. Auth. Rev. Participating VRDN,
Series BT-105, 3.50%, (Liquidity Facility Bankers
Trust Co.) (c) 7,068,600 7,068,600
Puerto Rico Gov't. Dev. Bank CP, 3.05% 2/7/95 4,000,000 4,000,000
Puerto Rico Hwy. And Trans. Rev. Series 93 X, 3.10%,
LOC Union Bank of Switzerland, VRDN 2,000,000 2,000,000
Puerto Rico Ind. Med. Hi Ed. & Envir. Cont. Facs. Fin. Auth.
Rev. (Mendez/Feagm Proj.) Series 1986, 3.50%,
LOC Bank of Tokyo, VRDN 1,000,000 1,000,000
Puerto Rico Pub. Bldg. Auth. Gtd. Pub. Ed. & Health Facs.
Rev. Rfdg. 8.875% 7/1/95 2,000,000 2,080,357
16,148,957
TOTAL INVESTMENTS - 100% $ 403,876,235
Total Cost for Income Tax Purposes $ 403,876,954
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Notes
CP - Commercial Paper
RAN - 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) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
(c) Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At January 31, 1995, the fund had a capital loss carryforward of
approximately $8,000 which will expire on January 31, 2003.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
JANUARY 31, 1995
1.ASSETS 2. 3.
4.Investment in securities, at value - See accompanying 5. $ 403,876,235
schedule
6.Cash 7. 271,088
8.Interest receivable 9. 2,327,392
10. 11.TOTAL ASSETS 12. 406,474,715
13.LIABILITIES 14. 15.
16.Dividends payable $ 14,503 17.
18.Accrued management fee 172,811 19.
20. 21.TOTAL LIABILITIES 22. 187,314
23.24.NET ASSETS 25. $ 406,287,401
26.Net Assets consist of: 27. 28.
29.Paid in capital 30. $ 406,294,281
31.Accumulated net realized gain (loss) on investments 32. (6,880)
33.34.NET ASSETS, for 406,292,856 shares outstanding 35. $ 406,287,401
36.37.NET ASSET VALUE, offering price and redemption 38. $1.00
price per share ($406,287,401 (divided by) 406,292,856 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED JANUARY 31, 1995
39.40.INTEREST INCOME 41. $ 10,916,305
42.EXPENSES 43. 44.
45.Management fee $ 1,878,255 46.
47.Non-interested trustees' compensation 2,128 48.
49. 50.TOTAL EXPENSES 51. 1,880,383
52.53.NET INTEREST INCOME 54. 9,035,922
55.56.NET REALIZED GAIN (LOSS) ON INVESTMENTS 57. (7,953)
58.59.NET INCREASE IN NET ASSETS RESULTING FROM 60. $ 9,027,969
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED JANUARY 31,
1995 1994
61.INCREASE (DECREASE) IN NET ASSETS
62.Operations $ 9,035,922 $ 6,568,377
Net interest income
63. Net realized gain (loss) (7,953) 1,073
64. Increase (decrease) in net unrealized gain from - (3,817)
accretion of market discount
65. 66.NET INCREASE (DECREASE) IN NET ASSETS 9,027,969 6,565,633
RESULTING FROM OPERATIONS
67.Dividends to shareholders from net interest income (9,035,922) (6,568,377)
68.Share transactions at net asset value of $1.00 per 566,930,253 427,705,579
share
Proceeds from sales of shares
69. Reinvestment of dividends from net interest income 8,761,154 6,265,299
70. Cost of shares redeemed (516,275,938) (420,743,406)
71. Net increase (decrease) in net assets and shares 59,415,469 13,227,472
resulting from share transactions
72. 73.TOTAL INCREASE (DECREASE) IN NET ASSETS 59,407,516 13,224,728
74.NET ASSETS 75. 76.
77. Beginning of period 346,879,885 333,655,157
78. End of period $ 406,287,401 $ 346,879,885
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
79. YEARS ENDED JANUARY 31, SIX MONTHS YEAR MARCH 4, 1991
ENDED ENDED (COMMENCEME
JANUARY 31, JULY 31, NT
OF OPERATIONS) T
O
JULY 31,
80. 1995 1994 1993 1992 1991
81.SELECTED
PER-SHARE DATA
82.Net asset value, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
beginning of period
83.Income from .024 .019 .012 .034 .017
Investment
Operations
Net interest income
84.Less Distributions (.024) (.019) (.012) (.034) (.017)
From net interest
income
85.Net asset value, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
end of period
86.TOTAL RETURN B 2.42% 1.95% 1.23% 3.45 1.71%
%
87.RATIOS AND SUPPLEMENTAL DATA
88.Net assets, $ 406,287 $ 346,880 $ 333,655 $ 278,369 $ 122,114
end of period
(000 omitted)
89.Ratio of expenses .50% .40% .17% .05 -
to average net assets A %
90.Ratio of expenses .50% .50% .50% .50 .50%A
to average net assets A %
before expense
reductions
91.Ratio of net interest 2.40% 1.93% 2.44% 3.29 4.17%A
income to average A %
net assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE TOTAL RETURNS WOULD HAVE BEEN
LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN.
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1995
1. SIGNIFICANT ACCOUNTING
POLICIES.
Spartan Massachusetts Municipal Money Market Portfolio (the fund) is a fund
of Fidelity Massachusetts Municipal Trust (the trust) and is authorized to
issue an unlimited number of shares. 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 Massachusetts business trust.
The following summarizes the significant accounting policies of the fund:
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, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned. Accretion
of market discount represents unrealized gain until realized at the time of
a security disposition or maturity.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
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. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, Fidelity Management &
Research Company (FMR) pays all expenses, including the cost of providing
shareholder services, except the compensation of the non-interested
Trustees and certain exceptions such as interest, taxes, brokerage
commissions and extraordinary expenses. FMR receives a fee that is computed
daily at an annual rate of .50% of the fund's average net assets.
To offset the cost of providing shareholder services, FMR or its affiliates
collect certain transaction fees from the fund's shareholders which
amounted to $8,211 for the period.
SUB-ADVISER FEE. As the fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect, and after reducing the fee
for any payments by FMR pursuant to the fund's Distribution and Service
Plan.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Massachusetts Municipal Trust and the
Shareholders of Spartan Massachusetts Municipal Money Market Portfolio:
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of investments and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of Spartan
Massachusetts Municipal Money Market Portfolio at January 31, 1995, the
results of their operations for the year then ended and the changes in
their net assets and the financial highlights for the periods indicated in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the fund's management; our
responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these financial statements in
accordance with generally accepted auditing standards, which require that
we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities owned at January 31,
1995 by correspondence with the custodian, provide a reasonable basis for
the opinion expressed above.
/s/PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
Dallas, Texas
February 27, 1995
TO CALL FIDELITY
FOR FUND INFORMATION AND QUOTES
The Fidelity Telephone Connection offers you special automated telephone
services for quotes and balances. The services are easy to use,
confidential and quick. All you need is a Touch Tone telephone.
YOUR PERSONAL IDENTIFICATION NUMBER
(PIN)
The first time you call one of our automated telephone services, we'll ask
you
to set up your Personal Identification
Number (PIN). The PIN assures that
only you have automated telephone
access to your account information.
Please have your Customer Number
(T-account #) handy when you call --
you'll need it to establish your PIN. If
you would ever like to change your PIN, just choose the "Change your
Personal
Identification Number" option when
you call. If you forget your PIN, please
call a Fidelity representative at 1-800-
544-6666 for assistance.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)MUTUAL FUND
QUOTES*
1-800-544-8544
Just make a selection from this record-ed menu:
PRESS
For quotes on funds you own.
1.
For an individual fund quote.
2.
For the ten most frequently
requested Fidelity fund quotes.
3.
For quotes on Fidelity Select
Portfolios.(registered trademark)
4.
To change your Personal
Identification Number (PIN).
5.
To speak with a Fidelity
representative.
6.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)MUTUAL FUND
ACCOUNT
BALANCES 1-800-544-7544
Just make a selection from this record-
ed menu:
PRESS
For balances on funds you own.
1.
For your most recent fund activity
(purchases, redemptions, and
dividends).
2.
To change your Personal
Identification Number (PIN).
3.
To speak with a Fidelity
representative.
4.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT IN
A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and send
you written confirmation upon completion of your request.
(LETTER_GRAPHIC)(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
100 Crosby Parkway - KP2C
Covington, KY 41015-4399
SELLING SHARES
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
Fidelity Investments
P.O. Box 30281
Salt Lake City, UT 84130-0281
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions
World Trade Center
164 Northern Avenue
Boston, MA 02210
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
(LETTER_GRAPHIC)(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
851 East Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
811 Wilshire Boulevard
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
1400 Civic Drive
Walnut Creek, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
185 Asylum Street
Hartford, CT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
90 Alhambra Plaza
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
4001 Tamiami Trail, North
Naples, FL
1907 West State Road 434
Orlando, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
2000 66th Street, North
St. Petersburg, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
One North Franklin
Chicago, IL
540 Lake Cook Road
Deerfield, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
1 West Pennsylvania Ave.
Towson, MD
7401 Wisconsin Avenue
Bethesda, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
101 Cambridge Street
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
26955 Northwestern Hwy.
Southfield, MI
MINNESOTA
38 South Sixth Street
Minneapolis, MN
MISSOURI
700 West 47th Street
Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
60B South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
505 Millburn Avenue
Short Hills, NJ
NEW YORK
1050 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
10 Bank Street
White Plains, NY
NORTH CAROLINA
2200 West Main Street
Durham, NC
4611 Sharon Road
Charlotte, NC
OHIO
600 Vine Street
Cincinnati, OH
1903 East Ninth Street
Cleveland, OH
28699 Chagrin Boulevard
Woodmere Village, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
Dallas, TX
1155 Dairy Ashford
Houston, TX
1010 Lamar Street
Houston, TX
2701 Drexel Drive
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
UTAH
215 South State Street
Salt Lake City, UT
VERMONT
199 Main Street
Burlington, VT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
1001 Fourth Avenue
Seattle, WA
WASHINGTON, DC
1775 K Street, N.W.
Washington, DC
WISCONSIN
222 East Wisconsin Avenue
Milwaukee, WI
INVESTMENT ADVISER
(registered trademark)
Fidelity Management & Research
Company
Boston, MA
SUB-ADVISER
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Janice Bradburn, Vice President
Fred L. Henning, Jr., Vice President
Arthur S. Loring, Secretary
Stephen P. Jonas, Treasurer
Thomas D. Maher, Assistant
Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox*
Phyllis Burke Davis*
Richard J. Flynn*
Edward C. Johnson 3d
E. Bradley Jones*
Donald J. Kirk*
Peter S. Lynch
Edward H. Malone*
Marvin L. Mann*
Gerald C. McDonough*
Thomas R. Williams*
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
United Missouri Bank, N.A.
Kansas City, MO
and
Fidelity Service Co.
Boston, MA
CUSTODIAN
United Missouri Bank, N.A.
Kansas City, MO
FIDELITY'S TAX-FREE
MONEY MARKET FUNDS
California Tax-Free Money Market
Connecticut Municipal Money Market
Massachusetts Tax-Free Money Market
Michigan Municipal Money Market
New Jersey Tax-Free Money Market
New York Tax-Free Money Market
Ohio Municipal Money Market
Spartan California Municipal
Money Market
Spartan Connecticut Municipal
Money Market
Spartan Florida Municipal Money Market
Spartan Massachusetts Municipal
Money Market
Spartan Municipal Money Fund
Spartan New Jersey Municipal
Money Market
Spartan New York Municipal
Money Market
Spartan Pennsylvania Municipal
Money Market
Tax-Exempt Money Market
THE FIDELITY
TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774 (8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
FIDELITY
(registered trademark)
MASSACHUSETTS
TAX-FREE
PORTFOLIOS
ANNUAL REPORT
JANUARY 31, 1995
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
FIDELITY MASSACHUSETTS TAX-FREE HIGH YIELD PORTFOLIO
PERFORMANCE 4 How the fund has done over time.
FUND TALK 7 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 10 A summary of major shifts in the
fund's investments over the past six
months
and one year.
INVESTMENTS 11 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 22 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
FIDELITY MASSACHUSETTS TAX-FREE MONEY MARKET PORTFOLIO
PERFORMANCE 26 How the fund has done over time.
FUND TALK 28 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 30 A summary of major shifts in the
fund's investments over the past six
months
and one year.
INVESTMENTS 31 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 37 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 41 Notes to the financial statements.
REPORT OF INDEPENDENT
ACCOUNTANTS 45 The auditor's opinion.
</TABLE>
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, THE FEDERAL
RESERVE BOARD OR
ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISK, INCLUDING THE
POSSIBLE LOSS OF
PRINCIPAL. NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A
BANK. FOR MORE
INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES, CALL
1-800-544-8888
FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
Although there have been a few positive market indications so far in 1995,
no one can predict what lies ahead for investors. Last year, stocks posted
below-average returns and bonds had one of the worst years in history. This
downturn followed a period in which the investing environment was generally
very positive.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
Keeping in mind that the effects of interest rate changes on your bond
investments will only be "paper" gains or losses unless you sell your
shares, staying in your bond fund may be appropriate if your investment
horizon is at least a year or more. The longer your investing time frame,
the more likely it is that you will retain your principal investment
through both up and down markets. For example, a 10-year time frame, such
as saving for a college education, enables you to weather these ups and
downs in a long-term fund, which has higher potential returns. An
intermediate-length fund could be appropriate if your investment horizon is
two to four years, and a short-term bond fund could be the right choice if
you need your money in one or two years.
If your time horizon is less than a year, you might want to consider moving
some of your bond investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
No matter what your investment horizon or portfolio diversity, it makes
good sense to follow a regular investment plan - investing a certain amount
of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
If you have any questions, please call us at 1-800-544-8888. We stand ready
to provide the information you need to make the investments that are right
for you.
Best regards,
Edward C. Johnson 3d
FIDELITY MASSACHUSETTS TAX-FREE HIGH YIELD PORTFOLIO
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each figure
includes changes in a fund's share price, reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells bonds
that have grown in value). You can also look at the fund's income to
measure performance.
CUMULATIVE TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
PERIODS ENDED JANUARY 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Massachusetts Tax-Free High Yield Portfolio -3.79% 44.26% 127.14%
Lehman Brothers Municipal Bond Index -3.56% 44.07% 140.51%
Average Massachusetts Municipal Bond Fund -4.65% 42.91% 118.04%
Consumer Price Index 2.80% 17.97% 42.46%
</TABLE>
CUMULATIVE TOTAL RETURNS reflect actual performance over a specific period
- in this case, one year, five years, or ten years. For example, if you
invested $1,000 in a fund that had a 5% return over the past year, you
would end up with $1,050. You can compare these figures to the performance
of the Lehman Brothers Municipal Bond Index - a broad gauge of the
municipal bond market. To measure how the fund stacked up against its
peers, you can look at the average Massachusetts tax-exempt municipal bond
fund, which currently reflects the performance of 32 Massachusetts
municipal bond funds tracked by Lipper Analytical Services. Both benchmarks
include reinvested dividends and capital gains, if any. Comparing the
fund's performance to the consumer price index (CPI) helps show how your
fund did compared to inflation. (The periods covered by the CPI numbers are
the closest available match to those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
PERIODS ENDED JANUARY 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Massachusetts Tax-Free High Yield Portfolio -3.79% 7.60% 8.55%
Lehman Brothers Municipal Bond Index -3.56% 7.58% 9.17%
Average Massachusetts Municipal Bond Fund -4.65% 7.40% 8.10%
Consumer Price Index 2.80% 3.36% 3.60%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
Mass Free High YieldMunicipal Bond Index
01/31/85 10000.01 10000.00
02/28/85 9803.40 9750.50
03/31/85 9919.95 9834.65
04/30/85 10153.76 10194.59
05/31/85 10508.97 10548.55
06/30/85 10674.76 10659.21
07/31/85 10759.93 10680.10
08/31/85 10695.51 10605.55
09/30/85 10556.70 10499.18
10/31/85 10862.84 10858.98
11/30/85 11168.22 11248.50
12/31/85 11339.17 11347.37
01/31/86 11914.03 12015.73
02/28/86 12351.85 12492.27
03/31/86 12425.85 12496.27
04/30/86 12360.15 12505.77
05/31/86 12156.47 12302.17
06/30/86 12245.19 12419.54
07/31/86 12354.27 12494.92
08/31/86 12816.92 13054.32
09/30/86 12848.65 13087.09
10/31/86 13056.41 13313.10
11/30/86 13239.67 13576.83
12/31/86 13254.10 13539.36
01/31/87 13540.30 13947.03
02/28/87 13643.69 14015.65
03/31/87 13599.94 13867.09
04/30/87 12915.37 13171.24
05/31/87 12750.70 13105.91
06/30/87 12970.01 13490.70
07/31/87 13157.22 13628.30
08/31/87 13203.68 13658.96
09/30/87 12667.70 13155.36
10/31/87 12498.75 13201.93
11/30/87 12822.48 13546.63
12/31/87 13087.17 13743.19
01/31/88 13499.32 14232.72
02/29/88 13654.47 14383.16
03/31/88 13416.17 14215.60
04/30/88 13525.48 14323.64
05/31/88 13597.81 14282.24
06/30/88 13744.76 14491.19
07/31/88 13842.02 14585.68
08/31/88 13889.58 14598.51
09/30/88 14091.78 14862.74
10/31/88 14346.34 15125.07
11/30/88 14263.60 14986.53
12/31/88 14483.72 15139.84
01/31/89 14691.03 15452.93
02/28/89 14594.80 15276.61
03/31/89 14605.37 15240.10
04/30/89 14964.19 15601.90
05/31/89 15230.51 15925.95
06/30/89 15360.46 16142.23
07/31/89 15478.30 16361.92
08/31/89 15418.26 16201.74
09/30/89 15359.29 16153.13
10/31/89 15504.79 16350.20
11/30/89 15724.41 16636.33
12/31/89 15822.98 16772.75
01/31/90 15745.45 16693.92
02/28/90 15940.41 16842.49
03/31/90 15967.76 16847.55
04/30/90 15758.11 16726.24
05/31/90 16100.93 17090.88
06/30/90 16269.63 17241.28
07/31/90 16499.58 17494.72
08/31/90 16301.66 17241.05
09/30/90 16356.25 17251.39
10/31/90 16412.10 17563.64
11/30/90 16919.28 17916.67
12/31/90 16991.42 17995.51
01/31/91 17201.37 18236.65
02/28/91 17333.32 18395.30
03/31/91 17419.66 18402.66
04/30/91 17661.10 18647.42
05/31/91 17839.02 18813.38
06/30/91 17874.23 18794.57
07/31/91 18133.24 19023.86
08/31/91 18298.44 19274.98
09/30/91 18466.64 19525.55
10/31/91 18631.25 19701.28
11/30/91 18680.59 19756.44
12/31/91 18912.37 20181.21
01/31/92 19076.90 20227.62
02/29/92 19137.69 20233.69
03/31/92 19156.57 20241.79
04/30/92 19326.71 20421.94
05/31/92 19537.64 20662.92
06/30/92 19862.55 21010.05
07/31/92 20396.60 21640.35
08/31/92 20140.00 21428.28
09/30/92 20311.47 21567.56
10/31/92 19968.34 21356.20
11/30/92 20473.75 21738.48
12/31/92 20669.09 21960.21
01/31/93 20972.97 22214.95
02/28/93 21694.54 23019.13
03/31/93 21498.29 22775.13
04/30/93 21695.83 23005.16
05/31/93 21843.00 23133.98
06/30/93 22187.12 23520.32
07/31/93 22171.64 23550.90
08/31/93 22634.29 24040.76
09/30/93 23020.89 24314.82
10/31/93 23077.48 24361.02
11/30/93 22887.88 24146.64
12/31/93 23339.73 24656.14
01/31/94 23609.45 24937.22
02/28/94 23115.42 24291.34
03/31/94 22120.68 23302.69
04/30/94 22195.23 23500.76
05/31/94 22413.74 23705.21
06/30/94 22309.37 23567.72
07/31/94 22730.98 23999.01
08/31/94 22831.03 24083.01
09/30/94 22459.43 23728.99
10/31/94 22007.29 23306.61
11/30/94 21386.22 22884.76
12/31/94 21922.17 23388.23
01/31/95 22714.49 24051.00
$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity
Massachusetts Tax-Free High Yield Portfolio ten years ago on January 31,
1985. As the chart shows, by January 31, 1995, the value of your investment
would have grown to $22,714- a 127.14% increase on your initial investment.
For comparison, look at how the Lehman Brothers Municipal Bond index did
over the same period. With dividends reinvested, the same $10,000 would
have grown to $24,051 - a 140.51% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, move in the
opposite direction of interest
rates. In turn, the share price,
return, and yield of a fund
that invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
TOTAL RETURN COMPONENTS
YEARS ENDED JANUARY 31,
1995 1994 1993 1992 1991
Dividend returns 5.85% 6.32% 6.67% 7.08% 7.55%
Capital appreciation
returns -9.64% 6.25% 3.27% 3.82% 1.70%
Total returns -3.79% 12.57% 9.94% 10.90% 9.25%
DIVIDEND returns and capital appreciation returns are both part of a bond
fund's total return. A dividend return reflects the actual dividends paid
by the fund. A capital appreciation return reflects both the amount paid by
the fund to shareholders as capital gain distributions and changes in the
fund's share price. Both returns assume the dividends or gains are
reinvested.
DIVIDENDS AND YIELD
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED JANUARY 31, 1995 PAST PAST 6 PAST 1
MONTH MONTHS YEAR
Dividends per share 5.88(cents) 34.91(cents) 70.02(cents)
Annualized dividend rate 6.52% 6.42% 6.31%
30-day annualized yield 6.35% - -
30-day annualized tax-equivalent yield 11.27% - -
</TABLE>
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $10.62 over
the past month, $10.79 over the past six months and $11.09 over the past
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all funds based on the
yields of the bonds in the fund, averaged over the past 30 days. This
figure shows you the yield characteristics of the fund's investments at the
end of the period. It also helps you compare funds from different companies
on an equal basis. The tax-equivalent yield shows what you would have to
earn on a taxable investment to equal the fund's tax-free yield, if you're
in the 43.68% combined 1995 federal and state tax bracket.
FIDELITY MASSACHUSETTS TAX-FREE HIGH YIELD PORTFOLIO
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Although there was a municipal
bond market rally beginning in
mid-November, sharply rising
interest rates caused a significant
downturn in all U.S. bond markets
in the 12 months ended January
31, 1995. Yields rose sharply -
and prices fell - on both taxable
and tax-free bonds. For the 12
months ended January 31, 1995,
the Lehman Brothers Municipal
Bond Index - a broad measure
of the tax-free market - had a
total return of -3.56%. By
comparison, the Lehman
Brothers Aggregate Bond Index
- a proxy of investment-grade
taxable bonds - returned
-2.31%. The Federal Reserve
Board raised the federal funds
rate - the rate banks charge
each other for overnight loans -
from 3.00% to 5.50% from
February through November. The
Fed was hoping to head off future
inflation that might be triggered by
an improving U.S. economy. The
supply of new municipal issues
dropped through most of the year,
as municipalities avoided issuing
bonds at ever higher rates.
However, the pace of interest rate
increases - which led to drops in
the value of bonds -
overshadowed the benefits of
lower supply. Investor demand
dropped due to inflation fears,
further dampening prices. The
late-year rally was sparked by
increased demand and continued
short supply of muni issues.
An interview with Guy Wickwire, Portfolio Manager of Fidelity Massachusetts
Tax-Free High Yield Portfolio
Q. GUY, HOW DID THE FUND PERFORM?
A. It performed better than many of its competitors given a difficult
environment. For the year ended January 31, 1995, the fund had a total
return of -3.79%. That compared to the average Massachusetts municipal bond
fund, which returned -4.65% for the same period, according to Lipper
Analytical Services.
Q. WHAT ACCOUNTS FOR THE FUND'S PERFORMANCE?
A. The most important factor is the fund's duration, which measures how
sensitive its share price is to changes in interest rates. The shorter the
fund's duration, the less sensitive its share price is to rising interest
rates. A year ago, the fund's duration was shorter than many of its
competitors, which helped the fund's performance in the early spring last
year. If you'll recall, that's when the Federal Reserve first started
raising short-term interest rates and the municipal bond market experienced
a dramatic sell-off.
Q. DID YOU CHANGE THE WAY YOU MANAGED THE FUND'S DURATION ONCE INTEREST
RATES STARTED RISING?
A. It's important to remember that when interest rates rise, a bond's price
declines and its duration lengthens. Conversely, when interest rates fall,
a bond's price rises and its duration shortens. As interest rates continued
to rise over the past year, the fund's bond prices declined and its
duration naturally lengthened. In addition, I also purposely began to
lengthen duration throughout the year. At times, therefore, I wanted to
temper the fund's lengthening duration when I thought that bond prices
could fall. One of the ways I did that was by using a strategy known as
hedging, or selling bond futures contracts. Basically, a bond futures
contract is an agreement to buy or sell a specific number of bonds at a
particular price on a specified future date. When the market did fall, the
price of the futures rose and offset some of the price declines for the
bonds I held in the fund. Recently, though, the fund's long duration has
worked in its favor. Municipal bond prices rallied in December 1994 and
January 1995 and having a long duration helped the fund once again.
Q. ALTHOUGH IT WASN'T A GREAT YEAR FOR MUNICIPAL BONDS, THE FUND
OUTPERFORMED THE AVERAGE FUND. WHAT ACCOUNTS FOR THAT?
A. As you know, the fund's total return is based on the appreciation, or
depreciation, of the prices of the bonds it holds and the income generated
from those bonds. The fund's relatively high income helped cushion its
share price when interest rates were rising and bond prices were falling.
To help generate income, I've concentrated 36.9% of the fund in health care
bonds which are generally high-yielding bonds. At the end of the period, a
BBB-rated health care bond could pay from 0.75% to 1.25% more in income
than a similarly rated general obligation bond. I bought many health care
bonds in 1993 and 1994, when fears about health care reform and increased
competition forced health care bond prices down. Within this sector, I've
diversified across a broad range of hospital, life care facility and
nursing home bonds that I believe can manage effectively in a more
competitive environment.
Q. IN DECEMBER, ORANGE COUNTY, CALIFORNIA, DECLARED BANKRUPTCY BECAUSE OF
LOSSES IT INCURRED FROM ITS INVESTMENT POOLS. ARE THERE ANY MASSACHUSETTS
MUNICIPALITIES FACING SIMILAR CIRCUMSTANCES?
A. After a careful analysis, and from what we know now, I'm comfortable
that none of the fund's current holdings are susceptible to that type of
situation. But as always, our research staff will continue to monitor
developments. The Orange County situation did cause a temporary disruption
in the national municipal bond market, but there do not appear to be any
long-term effects for bonds issued outside of California.
Q. IN YOUR VIEW, HOW DOES 1995 SHAPE UP FOR MASSACHUSETTS MUNICIPAL BONDS?
A. One factor that could be important is the limited availability of
Massachusetts municipal bonds in 1995. The number of these bonds issued in
1994 dropped by about 85% from 1993. That's because many issuers took
advantage of low interest rates to refinance their older, more expensive
debt in 1993, which created an abundant supply, but stopped doing so when
rates started to rise in 1994. I anticipate that the supply of bonds will
be tight in 1995, which may ultimately help to firm municipal bond prices.
Q. WHAT WILL YOUR STRATEGY BE?
A. I'll continue to position the fund to generate a higher-than-average
level of income, primarily by focusing on relatively high-yielding bonds.
Over the years, the fund has been one of the highest yielding funds in its
category, which has helped its total return. The primary way I'll attempt
to continue that is by researching and identifying low investment grade and
non-investment grade bonds that I think have good prospects for the future.
FUND FACTS
GOAL: to provide high current
income exempt from federal
and Massachusetts state
income taxes
START DATE: November 10,
1983
SIZE: as of January 31, 1995,
more than $1 billion
MANAGER: Guy Wickwire,
since November 1983;
manager,
Fidelity Insured Tax-Free
Portfolio, since October 1993;
Fidelity High Yield Tax-Free
Portfolio, 1981 to 1993;
Fidelity Advisor High Income
Municipal Portfolio, 1987 to
1992; joined
Fidelity in 1981
(checkmark)
GUY WICKWIRE ON MANAGING THE
FUND:
"I expect that the municipal
bond market will remain
volatile in 1995, until there are
definitive signs that the
economy has slowed, inflation
has remained moderate and
interest rates have peaked.
With that as a backdrop, my
strategy will be to seek the
best relative value among
various types and issuers of
municipal bonds, selling when
I think prices have peaked
and buying when I see the
potential for improvement. As
I have during the past 10
years of managing the fund,
I'll try to generate an
above-average level
of income, by investing in
high-yielding bonds."
(medium solid bullet) Inverse floaters, one type
of financial arrangement
known as derivatives, made
up 3.4% of the fund's
investments at the end of the
period. The yield on inverse
floaters rises as short-term
interest rates fall and vice
versa. By using various
derivatives, the manager
hopes to achieve higher
levels of tax-exempt income
and increased flexibility in
managing the fund's overall
sensitivity to changes in
interest rates. However, these
strategies can involve
additional risk to the fund and
don't always work as
intended.
FIDELITY MASSACHUSETTS TAX-FREE HIGH YIELD PORTFOLIO
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF JANUARY 31, 1995
% OF FUND'S % OF FUND'S INVESTMENT
INVESTMENTS S
IN THESE SECTORS
6 MONTHS AGO
Health Care 36.9 35.0
General Obligation 13.2 12.5
Education 9.9 10.9
Water & Sewer 9.9 10.0
Transportation 7.7 7.8
AVERAGE YEARS TO MATURITY AS OF JANUARY 31, 1995
6 MONTHS AGO
Years 19.5 20.1
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME UNTIL PRINCIPAL
PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS, WEIGHTED BY DOLLAR
AMOUNT.
DURATION AS OF JANUARY 31, 1995
6 MONTHS AGO
Years 8.1 9.1
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH A
FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER FACTORS
ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE. ACCORDINGLY,
A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THE ABOVE EXAMPLE.
QUALITY DIVERSIFICATION (MOODY'S RATINGS)
AS OF JANUARY 31, 1995 AS OF JULY 31, 1994
Aaa 22.9%
Aa, A 43.1%
Baa 11.3%
Ba, B 2.8%
Non-rated 16.6%
Short-term
investments 3.3%
Aaa 23.9%
Aa, A 47.5%
Baa 8.9%
Ba, B 2.5%
Non-rated 17.0%
Short-term
investments 0.2%
Row: 1, Col: 1, Value: 22.9
Row: 1, Col: 2, Value: 43.1
Row: 1, Col: 3, Value: 11.3
Row: 1, Col: 4, Value: 2.8
Row: 1, Col: 5, Value: 16.6
Row: 1, Col: 6, Value: 3.3
Row: 1, Col: 1, Value: 23.9
Row: 1, Col: 2, Value: 47.5
Row: 1, Col: 3, Value: 8.9
Row: 1, Col: 4, Value: 3.0
Row: 1, Col: 5, Value: 17.0
Row: 1, Col: 6, Value: 2.0
SHOWN AS A PERCENTAGE OF THE FUND'S INVESTMENTS. WHERE MOODY'S RATINGS ARE
NOT AVAILABLE, WE HAVE USED S&P RATINGS. UNRATED DEBT SECURITIES THAT ARE
EQUIVALENT TO BA AND BELOW ACCOUNT FOR 12.8% AND 11.9% OF THE FUND'S
INVESTMENTS AT JANUARY 31, 1995, AND JULY 31, 1994, RESPECTIVELY.
FIDELITY MASSACHUSETTS TAX-FREE HIGH YIELD PORTFOLIO
INVESTMENTS JANUARY 31, 1995
Showing Percentage of Total Value of Investments
MUNICIPAL BONDS - 96.7%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 96.6%
Amherst Gen. Oblig.:
6.50% 1/15/08 Aa $ 795,000 $ 829,781
6.50% 1/15/09 Aa 770,000 788,288
6.50% 1/15/10 Aa 750,000 767,813
Barnstable Ind. Dev. Fing. Auth. Ind. Dev. Rev.
(Whitehall Pavilion Health Proj.)
10.125% 2/15/26 (FHA Insured) A 3,115,000 3,212,344
Bellingham Gen. Oblig.:
7.50% 7/1/06 A 310,000 343,325
7.50% 7/1/07 A 310,000 343,325
7.50% 7/1/08 A 310,000 343,325
7.50% 7/1/09 A 310,000 336,350
7.50% 7/1/10 A 310,000 336,350
7.50% 7/1/11 A 300,000 324,750
Boston Econ. Dev. & Ind. Corp. (Boston Army
Base 1983 Proj.) 6.25% 8/1/03 AA 5,090,000 5,147,263
Boston Hsg. Dev. Corp. Mtg. Rev. Rfdg.
(FHA Section 8) Series A, 5.15% 7/1/08
(MBIA Insured) Aaa 3,455,000 3,152,688
Boston Ind. Dev. Fing. Auth. Ind. Rev.
(Massachusetts College of Pharmacy Proj. A):
5.25% 10/1/14 AAA 2,400,000 2,049,000
5.25% 10/1/26 AAA 1,000,000 812,500
Boston Ind. Dev. Rev. (North End Commty.
Nursing Home) 11.45% 3/15/25
(FHA Guaranteed) AA 4,865,000 5,582,588
Boston Wtr. & Swr. Commission Gen. Sr. Series A:
Rfdg. 5.75% 11/1/13 A 8,025,000 7,362,938
5.40% 11/01/08 A 1,000,000 913,750
5.25% 11/1/19 A 27,500,000 22,893,750
Bourne Gen. Oblig. Unltd. Tax
(Land Acquisition Loan):
8% 12/15/04 Baa 290,000 320,450
8% 12/15/05 Baa 290,000 321,538
8% 12/15/06 Baa 290,000 321,175
8% 12/15/07 Baa 290,000 320,088
Brockton Gen. Oblig.:
7.75% 12/15/96 Baa 3,000,000 3,060,000
6.125% 6/15/18 Baa 1,000,000 922,500
Brockton Hsg. Dev. Corp. Multi-Family Hsg. Rev.
Rfdg. (Douglas House Proj.) Series 1992 A,
7.375% 9/1/24 (FNMA Coll.) AAA 8,390,000 8,631,213
Chlesea School Proj. Loan Act 1948:
6.50% 6/15/12 (AMBAC Insured) Aaa 1,500,000 1,524,375
6%, 6/15/14 (AMBAC Insured) Aaa 2,830,000 2,723,875
Dedham-Westwood Wtr. Dist. Rfdg.:
5.10% 10/15/12 (MBIA Insured) Aaa 1,000,000 865,000
5.15% 10/15/16 (MBIA Insured) Aaa 1,250,000 1,064,063
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Dighton & Rehoboth Reg'l. School Dist.:
5.40% 5/15/10 (AMBAC Insured) Aaa $ 385,000 $ 348,906
5.40% 5/15/11 (AMBAC Insured) Aaa 185,000 166,963
5.40% 5/15/12 (AMBAC Insured) Aaa 225,000 201,094
Framingham Hsg. Dev. Corp. Mtg. Rev.
(Claffin House) Series A, 6.95% 1/1/24 AAA 1,820,000 1,838,200
Granville Gen. Oblig.:
7.30% 7/15/05 (MBIA Insured) Aaa 145,000 162,219
7.30% 7/15/06 (MBIA Insured) Aaa 145,000 162,038
7.30% 7/15/07 (MBIA Insured) Aaa 140,000 156,100
7.30% 7/15/08 (MBIA Insured) Aaa 140,000 155,575
Halifax Gen. Oblig.:
6.20% 6/1/10 (AMBAC Insured) Aaa 325,000 328,250
6.25% 6/1/11 (AMBAC Insured) Aaa 325,000 328,250
6.30% 6/1/12 (AMBAC Insured) Aaa 325,000 328,250
6.30% 6/1/13 (AMBAC Insured) Aaa 325,000 328,250
Haverhill Gen. Oblig. Rfdg. Series A:
6.40% 9/1/03 (AMBAC Insured) Aaa 1,600,000 1,672,000
6.50% 9/1/04 (AMBAC Insured) Aaa 1,595,000 1,666,775
Holyoke Gen. Oblig. 7% 11/1/08 Baa 1,000,000 1,031,250
Holyoke School Proj. Loan Act:
7.35% 8/1/02 Baa 2,270,000 2,431,738
7.65% 8/1/09 Baa 2,205,000 2,323,519
Hudson Gen. Oblig. Ltd. Tax:
7.50% 8/15/01 A 215,000 232,200
7.50% 8/15/02 A 215,000 233,813
7.50% 8/15/03 A 215,000 234,350
Lawrence Gen. Oblig.:
5.125% 9/15/03 Baa 500,000 468,125
5.25% 9/15/04 Baa 500,000 466,250
4.75% 2/15/14 (AMBAC Insured) Aaa 5,000,000 4,087,500
Leicester Gen. Oblig.:
Unltd. Tax:
5% 1/15/11 (MBIA Insured) Aaa 515,000 451,913
5.10% 5/15/13 (MBIA Insured) Aaa 305,000 266,875
5.10% 1/15/14 (MBIA Insured) Aaa 500,000 435,625
Leominster Gen. Oblig. 7.50% 4/1/09
(MBIA Insured) Aaa 2,300,000 2,518,500
Lowell Gen. Oblig.:
Rfdg. Series A 5.50% 1/15/10
(FSA Insured) Aaa 2,000,000 1,825,000
Ltd. Tax Lot B:
7.40% 11/15/00 Baa 205,000 220,375
7.50% 11/15/01 Baa 200,000 216,000
7.50% 11/15/02 Baa 200,000 216,250
7.60% 11/15/03 Baa 200,000 216,500
7.60% 11/15/04 Baa 200,000 215,750
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Lowell Gen. Oblig.: - continued
Series B, 5.60% 11/1/12 (FSA Insured) Aaa $ 2,500,000 $ 2,271,875
8% 1/15/00 Baa1 1,245,000 1,364,831
8.40% 1/15/09 Aaa 1,250,000 1,425,000
Lowell Hsg. Dev. Corp. Multi-Family Rev.:
Rfdg. Series A, 7.875% 11/1/24
(FNMA Coll.) AAA 5,440,000 5,691,600
7.875% 11/1/00 (FNMA Coll.) AAA 760,000 793,250
Lynn Gen. Oblig. Rfdg. 5.25% 1/15/11
(FSA Insured) Aaa 5,570,000 4,922,488
Lynn Wtr. & Swr. Commission Rev. Rfdg.:
5.35% 12/1/07 (FGIC Insured) Aaa 760,000 709,650
5.40% 12/1/08 (FGIC Insured) Aaa 805,000 744,625
5.45% 12/1/09 (FGIC Insured) Aaa 850,000 787,313
5.50% 12/1/10 (FGIC Insured) Aaa 500,000 461,875
Massachusetts Bay Trans. Auth. (Gen. Trans. Sys.):
Series A:
Rfdg. 5.50% 3/1/09 A1 6,000,000 5,610,000
Rfdg. 5.50% 3/1/12 A1 4,350,000 3,991,125
7% 3/1/21 A1 1,500,000 1,627,500
Series B, 6.20% 3/1/16 A1 5,000,000 4,943,750
Massachusetts Gen. Oblig.
(Cap. Appreciation Consolidated Loan):
Series B, 0% 7/1/02 A1 12,250,000 8,039,063
Series C, 0% 12/1/05 A1 18,050,000 9,498,813
Massachusetts Gen. Oblig. Rfdg.
Series B, 6.50% 8/1/08 A1 1,000,000 1,037,500
Massachusetts Health & Edl. Facs. Auth. Rev.:
Rfdg. (Boston College) Series K:
5.25% 6/1/09 A1 2,725,000 2,486,563
5.25% 6/1/10 A1 3,025,000 2,733,844
5.375% 6/1/14 A1 10,445,000 9,282,994
5.25% 6/1/23 A1 13,000,000 10,790,000
Rfdg. (Massachusetts Gen. Hosp.)
Series F, 6.25% 7/1/12 (AMBAC Insured) Aaa 4,750,000 4,720,313
Rfdg. (Wheaton College)
Series C, 5.125% 7/1/09 A 1,130,000 992,988
(1st Mtg.) (Fairview Extended Care):
Series A, 10.25% 1/1/21 - 10,000,000 10,800,000
(Anna Jaques Hosp.) Series B:
5.90% 10/1/99 Baa1 930,000 910,238
6% 10/1/00 Baa1 985,000 960,375
6.875% 10/1/12 Baa1 3,250,000 2,990,000
(Baystate Medical Center) Series D,
5% 7/1/12 (FGIC Insured) Aaa 7,900,000 6,724,875
(Beth Israel Hosp.)
6% 7/1/25 (AMBAC Insured) Aaa 20,000,000 18,875,000
(Blood Institute) Series A, 6.50% 2/1/22 - 16,000,000 14,940,000
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Edl. Facs. Auth. Rev. - continued
(Cape Cod Health Sys.) Series A, 5.25%
11/15/13 (Connie Lee Insured) AAA $ 3,500,000 $ 3,018,750
(Cardinal Cushing Gen. Hosp.)
Series A, 8.50% 7/1/00 - 900,000 901,125
(Central Med. Ctr.) Series B, 8.72%
6/23/22 (AMBAC Insured), INFL (d) Aaa 10,000,000 10,237,500
(Emerson Hosp.) Series C, 8% 7/1/18 Baa1 22,875,000 23,475,469
(Faulkner Hosp.) Series C:
6% 7/1/13 Baa1 8,995,000 7,814,406
6% 7/1/23 Baa1 6,605,000 5,473,894
(Falmouth Hosp.) Series C, 5.50% 7/1/08,
(MBIA Insured) Aaa 1,000,000 932,500
(Hebrew Rehabilitation Ctr. For Aged) Series B:
7% 7/1/97 A- 1,065,000 1,091,625
7.375% 7/1/17 A- 14,000,000 14,280,000
(Lowell Gen. Hosp.) Series A:
8.25% 6/1/00 Baa1 3,415,000 3,615,631
8.40% 6/1/11 Baa1 2,565,000 2,776,613
(Melrose-Wakefield Hosp.) Series B,
6.25% 7/1/12 A- 1,000,000 907,500
(Milford Whitinsville Reg'l. Hosp.) Series B:
7.125% 7/15/02 Ba1 3,100,000 3,049,625
7.75% 7/15/17 Ba1 14,400,000 13,770,000
(Morton Hosp. & Med. Ctr.) Series B:
5.25% 7/1/08 AAA 2,800,000 2,520,000
5.25% 7/1/14 AAA 2,265,000 1,947,900
5.50% 7/1/23 AAA 1,250,000 1,070,313
(Mt. Auburn Hosp.) Issue Series B-1
6.25% 8/15/14 (MBIA Insured) Aaa 1,250,000 1,229,688
(Norwood Hosp.):
Series C, 7% 7/1/14 Ba 1,520,000 1,288,200
Series E, 7.40% 7/1/99 Ba 200,000 194,000
(Notre Dame Health Care Ctr.) Series A:
7.25% 10/1/01 - 780,000 802,425
7.875% 10/1/22 - 5,000,000 5,012,500
(Simmons College) Series B, 7.50%
10/1/20 Baa1 6,190,000 6,615,563
(Sisters of Providence Health Sys.) Series A:
6.50% 11/15/08 Baa1 1,300,000 1,235,000
6.625% 11/15/22 Baa1 7,185,000 6,538,350
(St. Anne's Hosp.) Series A:
9.25% 7/1/05 Ba 1,270,000 1,270,000
9.375% 7/1/14 Ba 9,170,000 9,192,925
(St. Luke's Hosp. Med.) 5.70%
8/15/23 (MBIA Insured) Aaa 20,000,000 18,350,000
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Edl. Facs. Auth. Rev. - continued
(Tufts Univ.):
Series C, 7.40% 8/1/08 A1 $ 1,000,000 $ 1,078,750
6.81% 8/15/18 (FGIC Insured) INFL (d) Aaa 7,900,000 6,389,125
(Wellesly College) Series D:
5.30% 7/1/14 Aa1 5,400,000 4,752,000
5.375% 7/1/19 Aa1 7,015,000 6,111,819
(Wentworth Institute of Technology) Series B:
5.625% 10/1/13 AAA 2,000,000 1,785,000
5.50% 10/1/23 AAA 3,000,000 2,568,750
(Wheaton College) Series C:
5.25% 7/1/14 A 2,655,000 2,270,025
5.25% 7/1/19 A 2,000,000 1,667,500
(Whidden Mem. Hosp.) Series B:
7.375% 7/1/98 - 915,000 933,300
7.875% 7/1/12 - 6,530,000 6,554,488
(Williams College) Series D, 5.50% 7/1/17 Aa1 4,000,000 3,605,000
Massachusetts Hsg. Fin. Agcy. Hsg. Rev.:
(Multi-Family) Series 1985 A, 9.25%
12/1/14 (MBIA Insured) Aaa 1,950,000 2,042,625
(Single Family):
Series 3, 7.30% 6/1/14 Aa 6,000,000 6,300,000
Series 8, 7.70% 6/1/17 Aa 500,000 514,375
Series 10, 7.70% 12/1/17 Aa 795,000 821,831
Series 16:
7.80% 12/1/05 Aa 935,000 960,713
7.90% 6/1/14 Aa 985,000 1,012,088
Series 1985 A:
9.375% 12/1/09 Aa 395,000 402,406
9.50% 12/1/16 Aa 2,505,000 2,580,150
Massachusetts Ind. Fin. Agcy. Health Care
Facs. Rev. (Hampden Nursing Home Proj.)
Series A, 9.75% 10/1/17 - 11,910,000 11,731,350
Massachusetts Ind. Fin. Agcy. Ind. Rev.:
Rfdg. (Beverly Enterprises, Inc.) 8% 5/1/02 - 1,075,000 1,079,031
Rfdg. (Chelsea Jewish Nursing Home)
Series A, 11.15% 2/15/25
(FHA Guaranteed) BBB- 3,625,000 4,272,969
Rfdg. (Inner Belt Realty Trust Proj.)
Series 1985, 9.50% 12/1/98 - 1,708,523 1,787,543
(Beverly Enterprises, Inc.) 8.375% 5/1/09 - 1,875,000 1,917,188
(Meadow Green Nursing Home)
9.60% 8/1/27 (FHA Guaranteed) AA 3,860,000 4,110,900
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev. Rfdg.:
(Boston Edison Co. Proj.) Series A,
5.75% 2/1/14 Baa2 5,900,000 5,081,375
(Eastern Edison Co. Proj.) 5.875% 8/1/08 Baa2 5,250,000 4,744,688
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Resource
Recovery Rev. (Southeast MA Proj.)
Series A, 9% 7/1/15 - $ 1,000,000 $ 1,091,250
Massachusetts Ind. Fin. Agcy. Rev.:
Rfdg. (Emerson College)
8.50% 1/1/03 - 5,500,000 5,988,125
8.90% 1/1/18 - 11,250,000 12,262,500
Rfdg. (Framingham Union Hosp.) Series A:
8.25% 7/1/00 Baa1 3,405,000 3,588,019
8.625% 7/1/12 Baa1 14,645,000 15,743,375
Rfdg. (Milton Academy) Series B,
5.25% 9/1/19 (MBIA Insured) Aaa 3,000,000 2,550,000
Rfdg. (Museum of Science Proj.):
4.90% 11/1/06 (CGIC Insured) Aaa 480,000 426,600
5% 11/1/07 (CGIC Insured) Aaa 515,000 455,131
5% 11/1/08 (CGIC Insured) Aaa 1,590,000 1,389,263
5.10% 11/1/09 (CGIC Insured) Aaa 830,000 736,625
Rfdg. (Philips Academy) 5.375% 9/1/23 Aa1 14,800,000 12,746,500
(1st Mtg. Reeds Landing)
7.75% 10/1/00 - 2,500,000 2,440,625
8.625% 10/1/23 - 7,500,000 7,209,375
(Atlanticare Med. Ctr.):
Series A, 10.125% 11/1/14 - 1,900,000 1,862,000
Series B, 10.125% 11/1/14 - 8,600,000 8,428,000
(Boston Architectural Ctr. Proj.)
8.50% 9/1/19 - 3,645,000 3,859,144
(Brandon Residential Treatment Proj.)
8.75% 2/1/24 - 5,400,000 5,244,750
(Cap. Appreciation) (Massachusetts
Biomedical Research) Series A-2, 0%
8/1/07 A1 25,000,000 10,781,250
(Concord Academy) 6.90% 9/1/21
(FSA Insured) Aaa 1,370,000 1,404,250
(Emerson College) 8.25% 1/1/17 - 3,000,000 3,206,250
(Evergreen Ctr. Inc.) 9.25% 11/1/11 - 4,600,000 4,904,750
(Holy Cross College) 7% 7/1/19 A1 9,000,000 9,112,500
(Institute Dev. Disabilities) 9.25% 6/1/09 - 4,330,000 4,243,400
(Jacobs Pillow Dance Festival) 9%
12/1/11 - 4,800,000 2,760,000
(Leominster Hosp.) Series A, 8.375%
8/1/99 - 3,100,000 3,278,250
(Massachusetts Biomedical):
Series A-1:
0% 8/1/02 A1 3,650,000 2,308,625
0% 8/1/03 A1 1,000,000 583,750
Series A-2:
0% 8/1/05 (f) A1 24,600,000 12,392,250
0% 8/1/08 A1 20,000,000 8,000,000
0% 8/1/10 A1 10,000,000 3,450,000
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Rev. - continued
(New England Ctr. for Autism):
9% 11/1/05 - $ 2,900,000 $ 3,048,625
9.50% 11/1/17 - 8,610,000 9,255,750
7% 11/1/19 - 1,100,000 962,500
(Orchard Cove, Inc.):
8% 5/1/99 - 10,000,000 10,262,500
9% 5/1/22 - 15,200,000 16,226,000
(Springfield College):
5.25% 9/15/03 Baa1 755,000 712,531
5.25% 9/15/04 Baa1 885,000 825,263
5.35% 9/15/05 Baa1 930,000 866,063
5.625% 9/15/10 Baa1 1,000,000 906,250
(Whitehead Institute Biomedical Research)
5.125% 7/1/26 Aa 14,600,000 11,625,250
Massachusetts Muni. Wholesale Elec. Co.
6.75% 7/1/17 A 9,050,000 9,174,438
Massachusetts Muni. Wholesale Elec. Co. Pwr.
Supply Sys. Rev.:
Rfdg. Series A, 5.10% 7/1/08
(AMBAC Insured) Aaa 1,000,000 895,000
Rfdg. Series B:
4.75% 7/1/10 (MBIA Insured) Aaa 11,230,000 9,461,275
5% 7/1/17 (MBIA Insured) Aaa 12,710,000 10,533,413
Series A:
5.47% 7/1/18, INFL (d) Aaa 24,500,000 18,375,000
6% 7/1/18 A 13,000,000 12,073,750
Series C, 6.625% 7/1/18 A 10,000,000 10,050,000
Massachusetts Port. Auth. Rev.:
Rfdg. Series A:
5.50% 7/1/09 Aa 3,160,000 2,946,700
5% 7/1/13 Aa 9,835,000 8,396,631
Rfdg. 7.125% 7/1/12 Aa 2,490,000 2,536,688
5.625% 7/1/12 (Escrowed to Maturity) (e) Aaa 1,900,000 1,840,625
Massachusetts Spl. Oblig. Rev.:
(Gas Tax) Series A, 6% 6/1/13 A1 20,915,000 20,392,125
Series A, 5.75% 6/1/12 A1 5,985,000 5,551,088
Massachusetts Tpk. Auth. Tpk. Rev. Rfdg. Series A:
5% 1/1/13 A1 25,040,000 21,158,800
5% 1/1/20 A1 31,900,000 25,799,125
5.125% 1/1/23 (FGIC Insured) Aaa 18,320,000 15,320,100
Massachusetts Wtr. Poll. Abatement Trust Rev.:
(Massachusetts Wtr. Resources Auth.
Loan Prog.)
Series A:
5.35% 2/1/08 Aa 2,685,000 2,450,063
5.20% 8/1/11 Aa 5,520,000 4,892,100
5.45% 2/1/13 Aa 19,390,000 17,451,000
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Wtr. Poll. Abatement Trust Rev.: - continued
(Wtr. Poll. Pooled Loan Prog.)
Series 1:
5.40% 2/1/06 Aa $ 2,175,000 $ 2,047,219
5.40% 8/1/06 Aa 2,230,000 2,096,200
5.45% 2/1/07 Aa 2,000,000 1,857,500
5.45% 8/1/07 Aa 2,355,000 2,181,319
5.50% 2/1/08 Aa 1,000,000 927,500
5.50% 8/1/08 Aa 2,000,000 1,852,500
5.60% 8/1/13 Aa 14,300,000 13,084,500
Series B 5.25% 8/1/14 Aa 12,505,000 10,894,981
Massachusetts Wtr. Resource Auth.
(Cap. Appreciation) Series A, 0% 4/1/06
(MBIA Insured) Aaa 10,000,000 5,175,000
Methuen Wtr. Ltd. Tax Lot A:
9.50% 12/15/98 A1 260,000 296,075
9.50% 12/15/99 A1 260,000 303,225
9.50% 12/15/00 A1 260,000 307,450
Monson Gen. Oblig.:
Rfdg. 5.40% 10/15/07 (MBIA Insured) Aaa 1,005,000 949,725
5.50% 10/15/10 (MBIA Insured) Aaa 1,080,000 1,001,700
Nantucket Island Bank Rfdg. Series E,
7.25% 7/1/19 A 6,175,000 6,607,250
North Attleborough Gen. Oblig. Ltd. Tax
Rfdg. 5.25% 11/1/13 (AMBAC Insured) Aaa 1,000,000 882,500
Orleans Gen. Oblig. Unltd. Tax:
6.70% 6/15/08 A1 180,000 190,125
6.70% 6/15/09 A1 120,000 125,250
Pentucket Reg'l. School Dist.:
5.10% 2/15/11 (MBIA Insured) Aaa 530,000 467,725
5.10% 2/15/12 (MBIA Insured) Aaa 220,000 192,225
5.10% 2/15/13 (MBIA Insured) Aaa 575,000 500,250
5.10% 2/15/14 (MBIA Insured) Aaa 525,000 454,781
Pittsfield Gen. Oblig. Ltd. Tax 7.25% 8/1/06
(Pre-Refunded to 8/1/96 @ 103) (e) A 600,000 635,250
Plainville Gen. Oblig. Ltd. Tax:
7% 9/1/05 A 175,000 184,844
7% 9/1/06 A 175,000 184,625
7% 9/1/07 A 175,000 184,844
Plymouth County Ctfs. of Prtn. Series A, 7%
4/1/22 A- 10,995,000 11,077,463
Quabbin Reg'l. School Dist. 6.80% 6/15/05 A 510,000 535,500
Quincy Hosp. Rev. Rfdg.:
5.30% 1/15/11 (FSA Insured) Aaa 11,400,000 10,231,500
5.50% 1/15/13 (FSA Insured) Aaa 3,750,000 3,379,688
5.25% 1/15/16 (FSA Insured) Aaa 2,000,000 1,717,500
South Essex Swr. Dist.:
Ltd. Tax:
8.75% 12/1/01 A 425,000 499,375
8.75% 12/1/02 A 425,000 496,719
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
South Essex Swr. Dist.: - continued
8.75% 12/1/03 A $ 400,000 $ 465,500
8.75% 12/1/04 A 400,000 465,500
8.75% 12/1/05 A 400,000 464,500
Southern Berkshire Reg'l. School Dist.
7% 4/15/11 (MBIA Insured) (f) Aaa 4,000,000 4,215,000
Springfield Hsg. Auth. Multi-Family Mtg. Rev.
(Citywide Apts.):
9.50% 11/1/05 (FHA Guaranteed) - 465,000 484,763
9.625% 11/1/17 (FHA Guaranteed) - 1,500,000 1,586,250
9.625% 11/1/26 (FHA Guaranteed) - 3,250,000 3,436,875
Taunton Gen. Oblig. Elec.:
8% 2/1/00 A 1,000,000 1,090,000
8% 2/1/05 A 1,000,000 1,128,750
Taunton Ind. Dev. Fing. Ind. Dev. Rev.
(Pepsi Cola Metropolitan Bottle Co.)
5.65% 8/1/12 A1 2,400,000 2,217,000
Tewksbury Gen. Oblig. Unltd. Tax:
9.60% 12/15/98 Baa1 595,000 667,144
9.60% 12/15/99 Baa1 595,000 680,531
9.60% 12/15/00 Baa1 210,000 244,913
9.60% 12/15/01 Baa1 210,000 248,588
9.60% 12/15/02 Baa1 210,000 253,050
Tewksbury Gen. Oblig. Wtr.:
7.20% 6/1/05 Baa1 350,000 373,625
7.20% 6/1/06 Baa1 150,000 160,313
Westfield Gen. Oblig. Muni. Purp. Loan:
5% 9/1/10 (FSA Insured) Aaa 745,000 654,669
5% 9/1/11 (FSA Insured) Aaa 490,000 426,300
5% 9/1/12 (FSA Insured) Aaa 745,000 644,425
5% 9/1/13 (FSA Insured) Aaa 750,000 642,188
Winchedon Gen. Oblig. 6.05% 3/15/12
(AMBAC Insured) Aaa 1,275,000 1,244,719
Woods Hole, Martha's Vineyard & Nantucket
(Mass. Steamship Auth.) Series A:
5.125% 3/1/11 A1 1,100,000 963,875
5.125% 3/1/12 A1 630,000 546,500
989,625,243
U.S. VIRGIN ISLANDS - 0.1%
Virgin Island Pub. Fin. Auth. Rev.
Series A, 7% 10/1/02 - 1,000,000 1,043,750
TOTAL MUNICIPAL BONDS
(Cost $1,012,950,639) 990,668,993
MUNICIPAL NOTES (A) - 3.3%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 3.3%
Massachusetts Dedicated Income Tax Bonds
Updates First Recovery Loan Series 1990 B,
3.80%, LOC Nat'l. Westminster Bank,
VRDN VMIG 1 $ 22,600,000 $ 22,600,000
Massachusetts Health & Edl. Facs. Auth. Rev.
(Cap. Asset Prog.), VRDN:
Series 1985 D, 3.30% (MBIA Insured)
BPA Sanwa Bank VMIG 1 8,300,000 8,300,000
Series B, 4% (MBIA Insured)
BPA Sanwa Bank VMIG 1 2,600,000 2,600,000
TOTAL MUNICIPAL NOTES
(Cost $33,500,000) 33,500,000
TOTAL INVESTMENTS-100%
(Cost $1,046,450,639) $ 1,024,168,993
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
SOLD
700 U.S. Treasury Bond Contracts March 1995 $ 71,028,125 $ (812,599)
THE FACE VALUE OF FUTURES SOLD AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 6.9%
SECURITY TYPE ABBREVIATIONS
INFL - Inverse Floating Rate Security
VRDN - Variable Rate Demand Notes
LEGEND
(d) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(e) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals (AMT securities).
(f) Standard & Poor's Corporation credit ratings are used in the absence of
a rating by Moody's Investors Service, Inc.
(g) Coupon is inversely indexed to a floating interest rate. The price will
be more volatile than the price of a comparable fixed rate security. The
rate shown is the rate at period end.
(h) Security collateralized by an amount sufficient to pay interest and
principal.
(i) A portion of the security was pledged to cover margin requirements for
futures contracts. At the period end, the value of securities pledged
amounted to $6,733,750.
INCOME TAX INFORMATION
At January 31, 1995, the aggregate cost of investment securities for income
tax purposes was $1,046,450,639. Net unrealized depreciation aggregated
$22,281,646, of which $24,251,654 related to appreciated investment
securities and $46,533,300 related to depreciated investment securities.
The fund hereby designates $9,669,694 as a capital gain dividend for the
purpose of the dividend paid deduction.
The fund intends to elect to defer to its fiscal year ending January 31,
1996 $6,378,191 of losses recognized during the period November 1, 1994 to
December 31, 1994.
At January 31, 1995, the fund was required to defer $6,693,709 of losses on
futures contracts and options.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investments for the period ended is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 58.4% AAA, AA, A 56.9%
Baa 10.9% BBB 9.2%
Ba 2.8% BB 1.8%
B 0.0% B 1.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 16.6%. FMR
has determined that unrated debt securities that are lower quality account
for 12.8% of the total value of investment in securities.
The distribution of municipal securities by revenue source, as a percentage
of total value of investments, is as follows:
Health Care 36.9%
General Obligatrion 13.2
Others
(individually less than 10%) 49.9
TOTAL 100.0%
FIDELITY MASSACHUSETTS TAX-FREE HIGH YIELD PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
JANUARY 31, 1995
3.ASSETS 4. 5.
6.Investment in securities, at value (cost 7. $ 1,024,168,993
$1,046,450,639) - See accompanying schedule
8.Cash 9. 1,519,955
10.Interest receivable 11. 14,521,658
12. 13.TOTAL ASSETS 14. 1,040,210,606
15.LIABILITIES 16. 17.
18.Payable for investments purchased $ 1,750,260 19.
20.Dividends payable 1,483,276 21.
22.Accrued management fee 340,537 23.
24.Payable for daily variation on futures contracts 328,125 25.
26.Other payables and accrued expenses 127,641 27.
28. 29.TOTAL LIABILITIES 30. 4,029,839
31.32.NET ASSETS 33. $ 1,036,180,767
34.Net Assets consist of: 35. 36.
37.Paid in capital 38. $ 1,072,102,059
39.Accumulated undistributed net realized gain (loss) on 40. (12,827,047)
investments
41.Net unrealized appreciation (depreciation) 42. (23,094,245)
on investments
43.44.NET ASSETS, for 95,914,768 shares outstanding 45. $ 1,036,180,767
46.47.NET ASSET VALUE, offering price and redemption 48. $10.80
price per share ($1,036,180,767 (divided by) 95,914,768 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED JANUARY 31, 1995
49.50.INTEREST INCOME 51. $ 78,090,167
52.EXPENSES 53. 54.
55.Management fee $ 4,678,876 56.
57.Transfer agent, accounting and custodian fees 1,357,544 58.
and expenses
59.Non-interested trustees' compensation 23,193 60.
61.Registration fees 239 62.
63.Audit 51,789 64.
65.Legal 21,512 66.
67.Interest 920 68.
69.Reports to shareholders 11,599 70.
71.Miscellaneous 9,233 72.
73. 74.TOTAL EXPENSES 75. 6,154,905
76.77.NET INTEREST INCOME 78. 71,935,262
79.REALIZED AND UNREALIZED GAIN (LOSS) 81. 82.
80.Net realized gain (loss) on:
83. Investment securities 7,336,903 84.
85. Futures contracts 9,474,522 16,811,425
86.Change in net unrealized appreciation (depreciation) 87. 88.
on:
89. Investment securities (147,771,718) 90.
91. Futures contracts 566,183 (147,205,535)
92.93.NET GAIN (LOSS) 94. (130,394,110)
95.96.NET INCREASE (DECREASE) IN NET ASSETS 97. $ (58,458,848)
RESULTING FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED JANUARY 31,
1995 1994
98.INCREASE (DECREASE) IN NET ASSETS
99.Operations $ 71,935,262 $ 80,953,626
Net interest income
100. Net realized gain (loss) 16,811,425 39,977,635
101. Change in net unrealized appreciation (147,205,535) 39,916,269
(depreciation)
102. (58,458,848) 160,847,530
103.NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS
104.Distributions to shareholders: (71,935,262) (80,953,626)
From net interest income
105. From net realized gain (23,938,149) (25,900,006)
106. In excess of net realized gain - (3,133,619)
107. 108.TOTAL DISTRIBUTIONS (95,873,411) (109,987,251)
109.Share transactions 278,510,983 471,434,518
Net proceeds from sales of shares
110. Reinvestment of distributions 74,034,441 86,120,603
111. Cost of shares redeemed (549,442,213) (483,601,622)
112. (196,896,789) 73,953,499
Net increase (decrease) in net assets resulting from
share transactions
113. (351,229,048) 124,813,778
114.TOTAL INCREASE (DECREASE) IN NET ASSETS
115.NET ASSETS 116. 117.
118. Beginning of period 1,387,409,815 1,262,596,037
119. End of period $ 1,036,180,767 $ 1,387,409,815
120.OTHER INFORMATION 122. 123.
121.Shares
124. Sold 25,544,589 39,016,000
125. Issued in reinvestment of distributions 6,698,427 7,102,485
126. Redeemed (49,946,373) (39,936,090)
127. Net increase (decrease) (17,703,357) 6,182,395
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
128. YEARS ENDED JANUARY 31, SIX MONTHS YEARS ENDED JULY 31,
ENDED
JANUARY 31,
129. 1995 1994 1993 1992 1991 1990
130.SELECTED PER-SHARE DATA
131.Net asset value,
beginning of period $ 12.210 $ 11.750 $ 11.860 $ 11.320 $ 11.160 $ 11.250
132.Income from Investment
Operations .700 .714 .364 .735 .783 .799
Net interest income
133. Net realized and
unrealized gain (loss) (1.180) .720 (.040) .620 .270 (.090)
134. Total from investment
operations (.480) 1.434 .324 1.355 1.053 .709
135.Less Distributions (.700) (.714) (.364) (.735) (.783) (.799)
From net interest income
136. From net realized
gain on investments (.230) (.230) (.070) (.080) (.110) -
137. In excess of net
realized gain on investments - (.030) - - - -
138. Total distributions (.930) (.974) (.434) (.815) (.893) (.799)
139.Net asset value,
end of period $ 10.800 $ 12.210 $ 11.750 $ 11.860 $ 11.320 $ 11.160
140.TOTAL RETURN B -3.79 12.57 2.83% 12.48 9.90 6.60
% % % % %
141.RATIOS AND SUPPLEMENTAL DATA
142.Net assets, end of
period (000 omitted) $ 1,036,181 $ 1,387,410 $ 1,262,596 $ 1,235,407 $ 842,179 $ 737,321
143.Ratio of expenses to
average net assets .54 .54 .55%A .57 .56 .57
% % % % %
144.Ratio of net interest
income to average net assets 6.29 5.93 6.19%A 6.43 7.05 7.20
% % % % %
145.Portfolio turnover rate 22 40 42%A 18 29 31
% % % % %
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
FINANCIAL HIGHLIGHTS
FIDELITY MASSACHUSETTS TAX-FREE MONEY MARKET PORTFOLIO
PERFORMANCE: THE BOTTOM LINE
To measure a money market fund's performance, you can look at either total
return or yield. Total return reflects the change in a fund's share price
over a given period and reinvestment of its dividends (or income). Yield
measures the income paid by a fund. Since a money market fund tries to
maintain a $1 share price, yield is an important measure of performance.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Massachusetts Tax-Free Money Market 2.29% 16.14% 45.95%
Average Massachusetts
Tax-Free Money Market Fund 2.36% 17.07% n/a
Consumer Price Index 2.80% 17.97% 42.46%
CUMULATIVE TOTAL RETURNS reflect actual performance over a specific period
- in this case, one year, five years, or ten years. For example, if you
invested $1,000 in a fund that had a 5% return over the past year, you
would end up with $1,050. To measure how the fund stacked up against its
peers, you can compare its return to the average Massachusetts tax-free
money market fund's total return. This average currently reflects the
performance of 11 Massachusetts tax-free money market funds tracked by
IBC/Donoghue. Comparing the fund's performance to the consumer price index
(CPI) helps show how your investment did compared to inflation. (The
periods covered by the CPI and IBC/Donoghue numbers are the closest
available match to those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Massachusetts Tax-Free Money Market 2.29% 3.04% 3.85%
Average Massachusetts
Tax-Free Money Market Fund 2.36% 3.20% n/a
Consumer Price Index 2.80% 3.36% 3.60%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
1/31/94 4/30/94 7/31/94 10/31/94 1/31/95
Massachusetts Tax-Free 1.62% 2.22% 2.16% 2.70% 2.88%
Money Market
Average Massachusetts 1.70% 2.25% 2.31% 2.73% 2.95%
Tax-Free Money Market
Fund
Massachusetts Municipal 2.88% 3.94% 3.81% 4.76% 5.11%
Money Market Tax-equivalen
t
Average All Taxable 2.68% 3.15% 3.83% 4.40% 5.23%
Money Market Fund
Portion of fund's income - 0.4% 5.5% 5.1% -
subject to state taxes on
last day of period
</TABLE>
YIELD refers to the income paid by the fund over a given period. Yields for
money market funds are usually for seven-day periods, expressed as annual
percentage rates. A yield that assumes income earned is reinvested or
compounded is called an effective yield. The chart above shows the fund's
seven-day yield at quarterly intervals over the past year. You can compare
these yields to the average Massachusets tax-free money market fund. Or you
can look at the fund's tax-equivalent yield, which is based on a combined
effective 1995 federal and state income tax rate of 43.68% and reflects
that a portion of the fund's income may be subject to state taxes. The
tax-equivalent figures are useful in seeing how the fund stacked up against
the average taxable money market fund as tracked by IBC/Donoghue. A portion
of the fund's income may be subject to the alternative minimum tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT PAST
RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the two
may be misleading because it
ignores the way taxes reduce
taxable returns. Tax-equivalent
yield - the yield you'd have to
earn on a similar taxable
investment to match the
tax-free yield - makes the
comparison more meaningful.
Keep in mind that the U.S.
government neither insures nor
guarantees a money market
fund. And there is no
assurance that a money fund
will maintain a $1 share price.
(checkmark)
FIDELITY MASSACHUSETTS TAX-FREE MONEY MARKET PORTFOLIO
FUND TALK: THE MANAGER'S OVERVIEW
An interview with Janice Bradburn, Portfolio Manager of Fidelity
Massachusetts Tax-Free Money Market Portfolio
Q. JAN, MONEY MARKET INTEREST RATES HAVE RISEN DRAMATICALLY OVER THE PAST
YEAR. CAN YOU BRING US UP TO DATE?
A. Sure. A year ago, the federal funds rate - what banks charge each other
for overnight loans - was at 3%, where it had been for some time. Then on
February 4, 1994, the Federal Reserve made a preemptive strike against
inflation, raising the federal funds rate one-quarter percentage point to
3.25%. I use the word preemptive because at the time there was very little
concrete evidence of inflation, only what seemed - to the Fed, at least -
to be a growing threat. The federal funds rate ended the period at 5.50%. I
should point out that on February 1, 1995 - one day after the period ended
- the Fed raised the federal funds rate another one-half percentage point
to 6.00%.
Q. WHAT WAS YOUR STRATEGY IN THE FACE OF RISING RATES?
A. Ordinarily when rates are rising, I try to shorten the fund's average
maturity. That way, as the fund's securities roll over, I can replace them
with higher-yielding securities and seek to keep pace with rising rates. In
a nutshell, that was my strategy during most of 1994. In January 1994, at
the beginning of the period, the fund's average maturity was around 60
days. I let it roll down to around 40 days by the end of February, and on
down into the low 20s by mid-summer. Then as Massachusetts entered its
annual borrowing season and the heavy supply of new issues propped up
rates, I extended the fund slightly out past 30 days, and kept it there
during the final months of the period. By the end of January 1995, the
fund's average maturity was 28 days.
Q. HOW DID THE FUND PERFORM?
A. On January 31, 1995, the fund's seven-day yield was 2.88%, compared to
1.62% a year earlier, reflecting the dramatic rise in short-term interest
rates during the period. The fund's latest yield was the equivalent of a
5.11% taxable yield for Massachusetts investors in the 43.68% combined
state and federal tax bracket. The fund's total return for the year ended
January 31, 1995 was 2.29%. That lagged the average total return of 2.36%
for all Massachusetts tax-free money market funds during the same period,
according to IBC/Donoghue. Many tax-free securities issued in Massachusetts
do not meet the fund's strict standards for investment quality. If need be,
I will always choose to sacrifice some yield in order to meet the fund's
first goal, which is to maintain a stable $1.00 share price.
Q. WHAT CAN WE EXPECT IN THE MONTHS AHEAD?
A. Some observers believe that short-term rates are likely to move still
higher in the months ahead, despite the fact that inflation has so far
remained modest. But the lesson we all learned last year is that the Fed is
determined to stifle inflation before it becomes a problem. Therefore, as
long as the economic growth rate remains above the Fed's target rate of
2.5%, we probably can expect the federal funds rate to keep rising. With
that in mind, I'll likely try to keep the fund's average maturity in the
neutral to defensive range - or around 30 to 40 days - for the foreseeable
future.
FUND FACTS
GOAL: tax-free income with
share price stability by
investing in high-quality,
short-term Massachusetts
municipal securities
START DATE: November 11,
1983
SIZE: as of January 31, 1995,
more than $756 million
MANAGER: Janice Bradburn,
since January 1992; manager,
Fidelity Ohio Municipal Money
Market Portfolio, since October
1993; Spartan Massachusetts
Municipal Money Market
Portfolio, since January 1992;
Fidelity New York Tax-Free
Money Market Portfolio, since
September 1989; Spartan New
York Municipal Money Market
Portfolio, since February 1990;
joined
Fidelity in 1989
(checkmark)
WORDS TO KNOW
COMMERCIAL PAPER: A security
issued by a municipality to
finance capital or operating
needs.
FEDERAL FUNDS RATE: The interest
rate banks charge each other
for overnight loans.
MATURITY: The time remaining
before an issuer is scheduled
to repay the principal amount
on a debt security. When the
fund's average maturity -
weighted by dollar amount -
is short, the fund manager is
anticipating a rise in interest
rates. When the average
maturity is long, the manager
is expecting rates to fall.
When the average maturity is
neutral, the manager wants
the flexibility to respond to
rising rates, while still
capturing a portion of the
higher yields available from
issues with longer maturities.
MUNICIPAL NOTE: A security
issued in advance of future
tax or other revenues and
payable from those specific
sources.
TENDER BOND: A variable-rate,
long-term security that gives
the bond holder the option to
redeem the bond at face
value before maturity.
VARIABLE RATE DEMAND NOTE
(VRDN): A tender bond that
can be redeemed on short
notice, typically one or seven
days. VRDNs are useful in
managing the fund's average
maturity and liquidity.
FIDELITY MASSACHUSETTS TAX-FREE MONEY MARKET PORTFOLIO
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
1/31/95 7/31/94 1/31/94
0 - 30 83 85 68
31 - 90 4 9 8
91 - 180 11 4 12
181 - 397 2 2 12
WEIGHTED AVERAGE MATURITY
1/31/95 7/31/94 1/31/94
Massachusetts Tax-Free
Money Market 28 days 23 days 57 days
Average Massachusetts
Tax-Free Money Market Fun 34 days 33 days 56 days
d*
ASSET ALLOCATION
AS OF JANUARY 31, 1995 AS OF JULY 31, 1994
Row: 1, Col: 1, Value: 71.0
Row: 1, Col: 2, Value: 12.0
Row: 1, Col: 3, Value: 3.0
Row: 1, Col: 4, Value: 11.0
Row: 1, Col: 5, Value: 3.0
Row: 1, Col: 1, Value: 71.0
Row: 1, Col: 2, Value: 9.0
Row: 1, Col: 3, Value: 9.0
Row: 1, Col: 4, Value: 9.0
Row: 1, Col: 5, Value: 3.0
Variable rate
demand notes
(VRDNs) 71%
Commercial
paper 12%
Tender bonds 3%
Municipal
notes 11%
Other 3%
Variable rate
demand notes
(VRDNs) 71%
Commercial
paper 9%
Tender bonds 9%
Municipal
notes 9%
Other 2%
* SOURCE: IBC/DONOGHUE'S MONEY FUND REPORT(registered trademark)
FIDELITY MASSACHUSETTS TAX-FREE MONEY MARKET PORTFOLIO
INVESTMENTS JANUARY 31, 1995
Showing Percentage of Total Value of Investments
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 99.0%
Boston City Hosp. Participating VRDN, Series PT-2, 3.70%,
(Liquidity Facility Bank National De Paris) (c) $ 13,150,000 $ 13,150,000
Boston Gen. Oblig. Participating VRDN (c):
Series 6 A, 4.25% (Liquidity Facility Morgan Guaranty) 3,300,000
3,300,000
Series 6 C, 4.25% (Liquidity Facility Morgan Guaranty) 2,000,000
2,000,000
Boston Wtr. & Swr. Commission Gen. Rev., VRDN.:
Series 1985 A, 2.65%,
LOC Canadian Imperial Bank of Commerce 24,645,000 24,645,000
Series 1994 A, 3.65%
LOC State Street Bank & Trust 8,000,000 8,000,000
Brockton RAN 5.50%, BPA Fleet Bank 1,250,000 1,252,670
Cambridge Gen. Oblig. Bond 3.75% 2/1/95 1,010,000 1,010,000
Chelmsford BAN 3.80% 3/23/95 1,680,000 1,680,340
Clipper Participating VRDN, Series 93-2, 2.91%
(Liquidity Facility State Street Bank & Trust) (c) 19,000,000 19,000,000
Framingham Ind. Rev. Board (Perini Corp. Proj.) Series 1985,
2.90%, LOC Harris Trust & Savings Bank, VRDN 400,000 400,000
Holyoke Poll. Cont. Rev. (Holyoke Pwr. & Light Proj.)
Series 1988, 3.35%, LOC Union Bank of Switzerland,
VRDN 1,200,000 1,200,000
Hopkinton BAN 4.25% 7/6/95 2,000,000 2,001,647
Lincoln BAN 4% 7/6/95 4,750,000 4,755,830
Lowell BAN 4.625% 3/1/95
LOC State Street Bank & Trust 3,000,000 3,002,744
Massachusetts Bay Trans. Auth. Gen. Trans. Sys. Bond
Series B, 4% 3/1/95 2,000,000 2,000,817
Massachusetts Bay Trans. Auth. Rev. Bond
Series 1985 A, 8.70% 3/1/95 1,275,000 1,317,708
Massachusetts Bay Trans. Auth. RAN
Series 1994 A, 3.75% 3/1/95 9,150,000 9,149,059
Massachusetts Bay Trans. Auth., Series A, CP:
4% 2/24/95, LOC ABN-AMRO Bank 1,000,000 1,000,000
3.60% 2/28/95, LOC ABN-AMRO Bank 3,000,000 3,000,000
4.05% 4/7/95, LOC ABN AMRO Bank 2,000,000 2,000,000
4.10% 4/10/95, LOC ABN-AMRO Bank 2,400,000 2,400,000
Massachusetts College Bldg. Auth. Rev. Rfdg. Bond
Series 1994 A, 4% 5/1/95 1,000,000 1,000,000
Massachusetts Ed. Fin. Auth. Ed. Loan Rev. Issue E
Series 1994 A, 3.35%, VRDN (b) 6,300,000 6,300,000
Massachusetts Gen. Oblig. BAN, Series 1994 A,
5% 6/15/95 33,000,000 33,092,152
Massachusetts Gen. Oblig. Bond Series 1994 B,
5% 8/1/95 5,000,000 5,026,448
Massachusetts Gen. Oblig. Participating VRDN (c):
Series 93 A, 3.81% (Liquidity Facility Citibank) 3,000,000 3,000,000
Series 93 I, 3.81% (Liquidity Facility Citibank) 13,000,000 13,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Gen. Oblig. Tender Option Ctfs.,
Series CR-147, 3.81% (Liquidity Facility Citibank) (c) $ 5,000,000 $
5,000,000
Massachusetts Health & Edl. Facs. Auth. Rev.:
Bonds (Boston Univ.) Series G, 8.875% 7/1/95 4,000,000 4,132,119
Bonds (Harvard Univ.):
3.60% tender 2/10/95 5,200,000 5,200,000
3.60% tender 2/13/95 2,000,000 2,000,000
3.90% tender 2/21/95 1,500,000 1,500,000
3.60% tender 3/8/95 1,000,000 1,000,000
Bonds (Holy Cross College) Series F, 8.35%
5/1/95 1,000,000 1,030,362
(Boston Childrens Hosp.) 3.35% BPA Sanwa Bank,
VRDN 5,900,000 5,900,000
(Brigham & Women's Hosp.) Series A, 3.25%,
LOC Sanwa Bank, VRDN 800,000 800,000
(Cap. Asset Prog.) VRDN:
Series 1985 D, 3.30% (MBIA Insured)
BPA Sanwa Bank 31,000,000 31,000,000
Series A, 3.40%, LOC First Nat'l. Bank of Chicago 26,300,000
26,300,000
Series E, 3.35%, LOC Sanwa Bank, VRDN 25,400,000 25,400,000
Series G1, 3.20% (MBIA Insured)
(BPA Credit Suisse) VRDN 11,200,000 11,200,000
(Harvard Univ.) Series I, 3.35%, VRDN 112,215,000 112,215,000
(MIT) Series G, 3.35%, VRDN 4,000,000 4,000,000
(Mt. Ida College) 2.75%, LOC Chemical Bank,
Sakura Bank, VRDN 7,100,000 7,100,000
(Wellesley College) Series B, 3.25%, VRDN 11,900,000 11,900,000
(Williams College) Series E, 3.50%, VRDN 3,000,000 3,000,000
Massachusetts Hsg. Fin. Agcy. Participating VRDN (c):
Series PT-33, 3.85%
(Liquidity Facility Industrial Bank of Japan) (b) 5,180,000 5,180,000
Series 13C, 4.25% (Liquidity Facility Morgan Guaranty) 5,900,000
5,900,000
Series PA-83, 3.80%
(Liquidity Facility Merrill Lynch & Co.) (b) 4,000,000 4,000,000
Massachusetts Hsg. Fin. Agcy. Single Family Hsg. Rev. Bonds:
Series 25, 4.10% tender 6/1/95 22,500,000 22,500,000
Series A, 4.15% 7/1/95 (AMBAC Insured) (b) 1,875,000 1,871,632
Massachusetts Ind. Fin. Agcy. Adj. Rate Rev. Rfdg.
(WGBH Ed. Foundation Proj.) Series 1992, 3.65%,
LOC Nat'l. Westminster Bank, VRDN 4,915,000 4,915,000
Massachusetts Ind. Fin. Agcy. Adj. Tender Resource
Recovery Rev. (Ogden-Haverhill Proj.) Series 1986 B,
3.30%, LOC Union Bank of Switzerland, VRDN (b) 17,775,000 17,775,000
Massachusetts Ind. Fin. Agcy. Ind. Rev., VRDN:
Rfdg. (First Healthcare Corp.) Series 1993 B, 3%
LOC Wachovia Bank 700,000 700,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Ind. Rev., VRDN: - continued
Rfdg. (First Healthcare Corp. for Hillhaven Proj.) 3.75%,
LOC Wachovia Bank of Georgia $ 2,000,000 $ 2,000,000
Rfdg. (Quamco Inc. Proj.) Series 1988 B, 3.25%,
LOC Bank of Nova Scotia 1,405,000 1,405,000
(Interpolymer Corp.) Series 1992, 2.90%,
LOC Bank of Tokyo (b) 3,800,000 3,800,000
(Longview Fiber Co.) Series 1987, 2.85%,
LOC Algemene Bank 2,070,000 2,070,000
(United Medical Corp.) Series 1992, 3.70%,
LOC Chemical Bank (b) 1,600,000 1,600,000
Massachusetts Ind. Fin. Agcy. Multimodal Rev., VRDN:
(Hampshire College Proj.) 2.80%,
LOC Nat'l. Westminster Bank 1,000,000 1,000,000
(Holyoke Wtr. & Pwr. Co. Proj.) Series 1990
3.35%, LOC Canadian Imperial Bank of Commerce 7,500,000 7,500,000
3.75%, LOC Swiss Bank (b) 8,700,000 8,700,000
Massachusetts Ind. Fin. Agcy. Resource Recovery Rev.
(Ogden-Haverhill Proj.) Series 1992 A, 3.25%,
LOC Union Bank of Switzerland, VRDN 15,000,000 15,000,000
Massachusetts Ind. Fin. Agcy. Rev.:
Bonds (St. Mark's School of Southborough) Issue 1991,
5.25% tender 1/9/96 LOC Barclays Bank 2,000,000 2,000,000
Rfdg. (Showa Womens Institute Boston Inc. 1994 Proj.)
3.95%, LOC Fuji Bank, VRDN 7,000,000 7,000,000
(General Signal Proj.) 2.90%,
LOC Wachovia Bank of Georgia 7,500,000 7,500,000
(Mary Ann Morse Nursing Home)
Series A, 3.80%, LOC ABN-AMRO Bank, VRDN 6,000,000 6,000,000
Series B, 3.40%, LOC ABN-AMRO Bank, VRDN 7,000,000 7,000,000
(New England Deaconess Assoc.) Series 1993 B,
3.30%, LOC Banque Paribas, VRDN 1,500,000 1,500,000
(Tsubaki Inc.) 3.95%, LOC Sakura Bank, VRDN (b) 3,000,000 3,000,000
(Wheelock College Issue) Series A, 2.95%,
LOC Nat'l. Westminster Bank, VRDN 4,800,000 4,800,000
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev. Rfdg.
(First Healthcare Corp. Proj.) Series 1992 A, 3%,
LOC Wachovia Bank, VRDN 2,025,000 2,025,000
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev. Bonds
(New England Pwr. Co. Proj.) Rfdg.:
Series 1992 B:
3.70% tender 2/8/95 3,000,000 3,000,000
3.75% tender 2/13/95 8,500,000 8,500,000
4.15% tender 2/14/95 4,000,000 4,000,000
3.75% tender 2/17/95 8,600,000 8,600,000
4.30% tender 2/22/95 9,000,000 9,000,000
4.15% tender 2/27/95 2,700,000 2,700,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev. Bonds
(New England Pwr. Co. Proj.) Rfdg.: - continued
Series 1992 B: - continued
4.05% tender 4/11/95 $ 3,000,000 $ 3,000,000
4% tender 4/12/95 4,000,000 4,000,000
Series 1993 A, 3.75% tender 2/9/95 5,600,000 5,600,000
Series 1993 B:
3.90% tender 2/28/95 3,000,000 3,000,000
3.85% tender 3/9/95 9,250,000 9,250,000
Massachusetts Muni. Elec. Wholesale Co. Pwr. Supply
Sys. Rev. Series 1994 C, 3.50%,
LOC Canadian Imperial Bank, VRDN 23,300,000 23,300,000
Massachusetts Muni. Elec. Wholesale Supply Sys.
Participating VRDN, Series GS-93D, 3.75%
(Liquidity Facility Hong Kong & Shanghai Banking Corp.) (c) 6,400,000
6,400,000
Massachusetts Spl. Oblig. Rev. Bonds Series A,
4.50% 6/1/95 2,000,000 2,003,485
Massachusetts Tpk. Auth. Participating VRDN, Series PA-1009,
3.75% (Liquidity Facility Merrill Lynch & Co.) (c) 4,020,000 4,020,000
Massachusetts Wtr. Resources Auth. CP, 3.50% 2/17/95,
LOC Morgan Guaranty Trust 2,000,000 2,000,000
Massachusetts Wtr. Resources Auth. Gen. Oblig. Bond
Series A, 7.625% 8/1/95 (MBIA Insured) 1,000,000 1,018,178
Massachusetts Wtr. Resources Auth. Participating VRDN (c):
3.85% (Liquidity Facility Dai-Ichi Kangyo) 3,000,000 3,000,000
Series 1994 PW11, 3.70%
(Liquidity Facility Bank of Nova Scotia) 11,565,000 11,565,000
Northborough Ind. Rev. (Tru Realty Corp. Proj. Toys "R" Us, Inc)
3.025%, LOC Bankers Trust, VRDN 2,900,000 2,900,000
Somerville BAN 4.40% 7/28/95 2,000,000 2,000,944
South Essex Sewage Dist. Bond Series B,
4.10% 6/1/95 (MBIA Insured) 1,000,000 1,000,000
Springfield RAN 4.65% 2/23/95 BRA Fleet Bank 3,000,000 3,001,337
Westfield BAN 5% 6/28/95 1,400,000 1,401,385
Worcester BAN:
5% 8/31/95, LOC Sanwa Bank 7,700,000 7,717,300
Lot A, 4.25% 2/15/95, LOC State Street Bank 9,655,000 9,657,433
Lot B, 4.50% 2/15/95,
LOC State Street Bank & Trust (b) 2,100,000 2,100,687
716,839,277
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
PUERTO RICO - 1.0%
Puerto Rico Pub. Bldg. Auth. Gtd. Pub. Ed. & Health Facs.
Rev. Rfdg. Bonds 8.875% 7/1/95 $ 2,290,000 $ 2,382,008
Puerto Rico Elec. Pwr. Auth. Rev. Participating VRDN,
BT-105, 3.50% (Liquidity Facility Bankers Trust Co.)(c) 3,060,000
3,060,000
Puerto Rico Gov't. Dev. Bank 3.05% 2/7/95, CP 2,000,000 2,000,000
7,442,008
TOTAL INVESTMENTS - 100% $ 724,281,285
Total Cost for Income Tax Purposes $ 724,278,246
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Notes
CP - Commercial Paper
RAN - 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) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
(c) Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At January 31, 1995, the fund had a capital loss carryforward of
approximately $135,700, of which $58,300, $64,100 and $13,300 will expire
on January 31, 1997, 1998 and 2003, respectively.
FIDELITY MASSACHUSETTS TAX-FREE MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
JANUARY 31, 1995
146.ASSETS 147. 148.
149.Investment in securities, at value - See 150. $ 724,281,285
accompanying schedule
151.Cash 152. 26,954,539
153.Receivable for investments sold 154. 2,001,507
155.Interest receivable 156. 4,359,221
157. 158.TOTAL ASSETS 159. 757,596,552
160.LIABILITIES 161. 162.
163.Payable to custodian bank $ 169,182 164.
165.Dividends payable 67,936 166.
167.Accrued management fee 253,095 168.
169.Other payables and accrued expenses 177,728 170.
171. 172.TOTAL LIABILITIES 173. 667,941
174.175.NET ASSETS 176. $ 756,928,611
177.Net Assets consist of: 178. 179.
180.Paid in capital 181. $ 757,057,120
182.Accumulated net realized gain (loss) on 183. (132,370)
investments
184.Unrealized gain from accretion of market discount 185. 3,861
186.187.NET ASSETS, for 756,959,209 shares 188. $ 756,928,611
outstanding
189.190.NET ASSET VALUE, offering price and 191. $1.00
redemption price per share ($756,928,611 (divided by)
756,959,209 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED JANUARY 31, 1995
192.193.INTEREST INCOME 194. $ 19,712,195
195.EXPENSES 196. 197.
198.Management fee $ 2,763,703 199.
200.Transfer agent, accounting and custodian fees 1,426,651 201.
and expenses
202.Non-interested trustees' compensation 551 203.
204.Registration fees 20,276 205.
206.Audit 28,935 207.
208.Legal 6,780 209.
210.Reports to shareholders 10,671 211.
212.Miscellaneous 7,740 213.
214. 215.TOTAL EXPENSES 216. 4,265,307
217.218.NET INTEREST INCOME 219. 15,446,888
220.REALIZED AND UNREALIZED GAIN (LOSS) 222. (13,283)
221.Net realized gain (loss) on investment securities
223.Increase (decrease) in net unrealized gain from 224. 3,861
accretion
of market discount
225.226.NET GAIN (LOSS) 227. (9,422)
228.229.NET INCREASE IN NET ASSETS RESULTING FROM 230. $ 15,437,466
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED JANUARY 31,
1995 1994
231.INCREASE (DECREASE) IN NET ASSETS
232.Operations $ 15,446,888 $ 9,765,157
Net interest income
233. Net realized gain (loss) (13,283) 28,587
234. Increase (decrease) in net unrealized gain from 3,861 (7,088)
accretion of market discount
235. 15,437,466 9,786,656
236.NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS
237.Dividends to shareholders from net interest income (15,446,888) (9,765,157)
238.Share transactions at net asset value of $1.00 per 1,739,919,170 1,344,601,052
share
Proceeds from sales of shares
239. Reinvestment of dividends from net interest 14,845,806 9,363,840
income
240. Cost of shares redeemed (1,607,981,120) (1,328,771,708)
241. 146,783,856 25,193,184
Net increase (decrease) in net assets and shares
resulting from share transactions
242. 146,774,434 25,214,683
243.TOTAL INCREASE (DECREASE) IN NET ASSETS
244.NET ASSETS 245. 246.
247. Beginning of period 610,154,177 584,939,494
248. End of period $ 756,928,611 $ 610,154,177
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
249. YEARS ENDED JANUARY 31, SIX MONTHS YEARS ENDED JULY 31,
ENDED
JANUARY 31,
250. 1995 1994 1993 1992 1991 1990
251.SELECTED PER-SHARE DATA
252.Net asset value, beginning
of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
253.Income from Investment
Operations .023 .017 .010 .029 .046 .053
Net interest income
254. Dividends from net
interest income (.023) (.017) (.010) (.029) (.046) (.053)
255.Net asset value,
end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
256.TOTAL RETURN B 2.29 1.71 .99% 2.94 4.70 5.42
% % % % %
257.RATIOS AND SUPPLEMENTAL DATA
258.Net assets, end of period
(000 omitted) $ 756,929 $ 610,154 $ 584,939 $ 600,945 $ 714,567 $ 750,877
259.Ratio of expenses to
average net assets .63 .66 .64%A .65 .60 .57
% % % % %
260.Ratio of net interest income
to average net assets 2.28 1.69 1.96%A 2.93 4.60 5.33
% % % % %
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
FINANCIAL HIGHLIGHTS
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1995
1. SIGNIFICANT ACCOUNTING
POLICIES.
Fidelity Massachusetts Tax-Free High Yield Portfolio and Fidelity
Massachusetts Tax-Free Money Market Portfolio (the funds) are funds of
Fidelity Massachusetts Municipal Trust (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 Massachusetts
business trust. Each fund is authorized to issue an unlimited number of
shares. The following summarizes the significant accounting policies of the
funds:
SECURITY VALUATION.
HIGH YIELD FUND. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days of their purchase date are valued either at
amortized cost or original cost plus accrued interest, both of which
approximate current value. Securities for which quotations are not readily
available through the pricing service are valued at their fair value as
determined in good faith under consistently applied procedures under the
general supervision of the Board of Trustees.
MONEY MARKET FUND. 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 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 original issue discount, is accrued as earned. For the
money market fund, accretion of market discount represents unrealized gain
until realized at the time of a security disposition or maturity.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income. Distributions to shareholders from
realized capital gains on investments, if any, are recorded on the
ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for futures
and options transactions, net operating losses, capital loss carryforwards,
expiring capital loss carryforwards and losses deferred due to wash sales,
futures and options and excise tax
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS. - CONTINUED
regulations. The high yield fund also utilized earnings and profits
distributed to shareholders on redemption of shares as a part of the
dividends paid deduction for income tax purposes.
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.
FUTURES CONTRACTS AND OPTIONS. The high yield fund may use futures and
options contracts to manage its exposure to the bond market and to
fluctuations in interest rates . Buying futures, writing puts, and buying
calls tend to increase the fund's exposure to the underlying instrument.
Selling futures, buying puts, and writing calls tend to decrease the fund's
exposure to the underlying instrument, or hedge other fund investments.
Futures contracts and written options involve, to varying degrees, risk of
loss in excess of the futures variation margin or the option value
reflected in the Statement of Assets and Liabilities. The underlying face
amount at value is shown in the schedule of investments under the caption
"Futures Contracts". This amount reflects each contract's exposure to the
underlying instrument at period end. Losses may arise from changes in the
value of the underlying instruments, if there is an illiquid secondary
market for the contracts, or if the counterparties do not perform under the
contracts' terms.
Futures contracts are valued at the settlement price established each day
by the board of trade or exchange on which they are traded. Exchange-traded
options are valued using the last sale price or, in the absence of a sale,
the last offering price. Options traded over-the-counter are valued using
dealer-supplied valuations.
3. PURCHASES AND SALES OF
INVESTMENTS.
HIGH YIELD FUND. Purchases and sales of securities, other than short-term
securities, aggregated $247,715,885 and $463,002,531, respectively.
The market value of futures contracts opened and closed during the period
amounted to $1,299,594,232 and $1,347,243,644, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, Fidelity Management &
Research Company (FMR) receives a monthly fee that is calculated on the
basis of a group fee rate plus a fixed individual fund fee rate applied to
the average net assets of each fund. The group fee rate is the weighted
average of a series of rates and is based on the monthly average net assets
of all the mutual funds advised by FMR. The rates ranged from .1325% to
.3700% for the period February 1, 1994 to July 31, 1994 and .1200% to
.3700% for the period August 1, 1994 to January 31, 1995.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MANAGEMENT FEE. - CONTINUED
In the event that these rates were lower than the contractual rates in
effect during those periods, FMR voluntarily implemented the above rates,
as they resulted in the same or a lower management fee. The annual
individual fund fee rate is .25%. For the period, the management fees were
equivalent to annual rates of .41% of average net assets for the high yield
and money market funds, respectively.
SUB-ADVISER FEE. As the money market fund's investment sub-adviser, FMR
Texas Inc., a wholly owned subsidiary of FMR, receives a fee from FMR of
50% of the management fee payable to FMR. The fee is paid prior to any
voluntary expense reimbursements which may be in effect, and after reducing
the fee for any payments by FMR pursuant to the fund's Distribution and
Service Plan.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plans (the Plans), and in accordance with Rule 12b-1 of the 1940 Act, FMR
or the funds' distributor, Fidelity Distributors Corporation (FDC), an
affiliate of FMR, may use their resources to pay administrative and
promotional expenses related to the sale of each fund's shares. Subject to
the approval of each Board of Trustees, the Plans also authorize payments
to third parties that assist in the sale of each fund's shares or render
shareholder support services. FMR or FDC has informed the funds that
payments made to third parties under the Plans amounted to $21,948 and
$32,558 for the high yield and money market funds, respectively, for the
period.
TRANSFER AGENT AND ACCOUNTING FEES. United Missouri Bank, N.A. (the Bank)
is the custodian and transfer and shareholder servicing agent for the
funds. The Bank has entered into a sub-contract with Fidelity Service Co.
(FSC), an affiliate of FMR, under which FSC performs the activities
associated with the funds' transfer and shareholder servicing agent and
accounting functions. The funds pay transfer agent fees based on the type,
size, number of accounts and number of transactions made by shareholders.
FSC pays for typesetting, printing and mailing of all shareholder reports,
except proxy statements. The accounting fee is based on the level of
average net assets for the month plus out-of-pocket expenses. For the
period, FSC received transfer agent and accounting fees amounting to
$956,198 and $374,950 for the high yield fund and $1,255,747 and $118,907
for the money market fund, respectively.
Shareholders participating in the Fidelity Ultra Service Account(registered
trademark) Program (the Program) pay a $5.00 monthly fee to Fidelity
Brokerage Services, Inc. (FBSI), an affiliate of FMR, for performing
services associated with the Program. For the period, fees paid to FBSI by
shareholders participating in the Program amounted to $125,330.
5. BANK BORROWINGS.
Each fund is permitted to have bank borrowings for temporary or emergency
purposes to fund shareholder redemptions. Each fund has established
borrowing arrangements with certain banks. Under the most restrictive
arrangement, each fund must pledge to the bank securities having a market
value in excess of 220% of the total bank borrowings. The interest rate on
the borrowings is the bank's base rate, as revised from time to time. For
the high yield fund, the maximum loan and the average daily loan balances
during the periods for which loans were outstanding amounted to $5,356,000
and $4,414,500, respectively. The weighted average interest rate was 3.75%.
Interest expense includes $920 paid under the bank borrowing program.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Massachusetts Municipal Trust and the
Shareholders of: Fidelity Massachusetts Tax-Free High Yield Portfolio and
Fidelity Massachusetts Tax-Free Money Market Portfolio:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments (except for Moody's and Standard &
Poor's ratings) and the related statements of operations and of changes in
net assets and the financial highlights present fairly, in all material
respects, the financial position of Fidelity Massachusetts Tax-Free High
Yield Portfolio and Fidelity Massachusetts Tax-Free Money Market Portfolio
(each a fund of Fidelity Massachusetts Municipal Trust ) at January 31,
1995, the results of their operations for the year then ended, and the
changes in their net assets and the financial highlights for the periods
indicated, in conformity with generally accepted accounting principles.
These financial statements and financial highlights (hereafter referred to
as "financial statements") are the responsibility of the trust's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards, which
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe
that our audits, which included confirmation of securities owned at January
31, 1995 by correspondence with the custodian and brokers and the
application of alternative auditing procedures where confirmations from
brokers were not received, provide a reasonable basis for the opinion
expressed above.
/s/PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
Boston, Massachusetts
March 2, 1995
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and send
you written confirmation upon completion of your request.
(LETTER_GRAPHIC)(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
100 Crosby Parkway - KP2C
Covington, KY 41015-4399
SELLING SHARES
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
Fidelity Investments
P.O. Box 30281
Salt Lake City, UT 84130-0281
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions
World Trade Center
164 Northern Avenue
Boston, MA 02210
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
(LETTER_GRAPHIC)(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
TO CALL FIDELITY
FOR FUND INFORMATION AND QUOTES
The Fidelity Telephone Connection offers you special automated telephone
services for quotes and balances. The services are easy to use,
confidential and quick. All you need is a Touch Tone telephone.
YOUR PERSONAL IDENTIFICATION NUMBER
(PIN)
The first time you call one of our automated telephone services, we'll ask
you
to set up your Personal Identification
Number (PIN). The PIN assures that
only you have automated telephone
access to your account information.
Please have your Customer Number
(T-account #) handy when you call --
you'll need it to establish your PIN. If
you would ever like to change your PIN, just choose the "Change your
Personal
Identification Number" option when
you call. If you forget your PIN, please
call a Fidelity representative at 1-800-
544-6666 for assistance.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)MUTUAL FUND
QUOTES*
1-800-544-8544
Just make a selection from this record-ed menu:
PRESS
For quotes on funds you own.
1.
For an individual fund quote.
2.
For the ten most frequently
requested Fidelity fund quotes.
3.
For quotes on Fidelity Select
Portfolios.(registered trademark)
4.
To change your Personal
Identification Number (PIN).
5.
To speak with a Fidelity
representative.
6.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)MUTUAL FUND
ACCOUNT
BALANCES 1-800-544-7544
Just make a selection from this record-
ed menu:
PRESS
For balances on funds you own.
1.
For your most recent fund activity
(purchases, redemptions, and
dividends).
2.
To change your Personal
Identification Number (PIN).
3.
To speak with a Fidelity
representative.
4.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT IN
A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES.
INVESTMENT ADVISER
(registered trademark)
Fidelity Management & Research
Company
Boston, MA
SUB-ADVISER, MONEY MARKET FUND
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Guy Wickwire, Vice President
HIGH YIELD FUND
Janice Bradburn, Vice President
MONEY MARKET FUND
Arthur S. Loring, Secretary
Thomas D. Maher, Assistant
Vice President - MONEY MARKET FUND
Stephen P. Jonas, Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox*
Phyllis Burke Davis*
Richard J. Flynn*
Edward C. Johnson 3d
E. Bradley Jones*
Donald J. Kirk*
Peter S. Lynch
Marvin L. Mann*
Edward H. Malone*
Gerald C. McDonough*
Thomas R. Williams*
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
United Missouri Bank, N.A.
Kansas City, MO
and
Fidelity Service Co.
Boston, MA
CUSTODIAN
United Missouri Bank, N.A.
Kansas City, MO
THE FIDELITY
TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774 (8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
