SPARTAN(registered trademark)
(registered trademark)
MASSACHUSETTS
MUNICIPAL
MONEY MARKET
FUND
SEMIANNUAL REPORT
JULY 31, 1997
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 17 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
NOTES 21 Notes to the financial statements.
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,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
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.
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
Through the first seven months of 1997, stock and bond markets experienced
the kind of short-term volatility that can affect them periodically. The
stock market rebounded strongly from its early spring correction to
continue on its record-setting pace, as seen by the roughly 30%
year-to-date gain by the Standard & Poor's 500 Index. The bond market
posted moderate returns over the past seven months, as positive news on the
inflation front helped soften the effects of a hike in short-term interest
rates by the Federal Reserve Board in late March.
While it's impossible to predict the future direction of the markets with
any degree of certainty, there are certain basic principles that can help
investors plan for their future needs.
First, investors are encouraged to take a long-term view of their
portfolios. If you can afford to leave your money invested through the
inevitable up and down cycles of the financial markets, you will greatly
reduce your vulnerability to any single decline. We know from experience,
for example, that stock prices have gone up over longer periods of time,
have significantly outperformed other types of investments and have stayed
ahead of inflation.
Second, you can further manage your investing risk through diversification.
A stock mutual fund, for instance, is already diversified, because it
invests in many different companies. You can increase your diversification
further by investing in a number of different stock funds, or in such other
investment categories as bonds. You should also keep money you'll need in
the near future in a more stable investment.
Finally, no matter what your time horizon or portfolio diversity, it makes
good sense to follow a regular investment plan, investing a certain amount
of money in a fund at the same time each month or quarter and periodically
reviewing your overall portfolio. By doing so, you won't get caught up in
the excitement of a rapidly rising market, nor will you buy all your shares
at market highs. While this strategy - known as dollar cost averaging -
won't assure a profit or protect you from a loss in a declining market, it
should help you lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are available
24 hours a day, seven days a week to provide you the information you need
to make the investments that are right for 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 the value of an
investment, assuming reinvestment of the fund's dividend income, and the
effect of the fund's $5 account closeout fee on an average size account.
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, the past five years
and life of fund total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JULY 31, 1997 PAST 6 PAST 1 PAST 5 LIFE OF
MONTHS YEAR YEARS FUND
Spartan Massachusetts Municipal 1.56% 3.12% 14.25% 20.22%
Money Market Fund
Massachusetts Tax-Free Money Market 1.50% 3.00% 13.72% n/a
Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years or since
the fund started on March 4, 1991. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. To measure how the fund's performance stacked
up against its peers, you can compare it to the Massachusetts tax-free
money market funds average, which reflects the performance of 11
Massachusetts tax-free money market funds with similar objectives tracked
by IBC Financial Data, Inc. over the past six months. (The periods covered
by the IBC Financial Data, Inc. numbers are the closest available match to
those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JULY 31, 1997 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Spartan Massachusetts Municipal 3.12% 2.70% 2.91%
Money Market Fund
Massachusetts Tax-Free Money Market 3.00% 2.61% n/a
Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year.
YIELDS
8/4/97 4/28/97 2/3/97 10/28/96 7/29/96
Spartan Massachusetts 3.15% 3.50% 3.02% 3.07% 3.01%
Municipal Money
Market Fund
Massachusetts 3.04% 3.45% 2.89% 2.93% 2.92%
Tax-Free Money Market
Funds Average
Spartan Massachusetts 5.59% 6.21% 5.36% 5.45% 5.34%
Municipal Money Market
Fund - Tax-equivalent
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 Massachusetts tax-free money market funds
average. Or you can look at the fund's tax-equivalent yield, which is based
on a combined effective 1997 federal and state income tax rate of 43.68%.
Figures for the Massachusetts tax-free money market funds average are from
IBC Financial Data, Inc. 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
NOTE TO SHAREHOLDERS: Tanya Roy became Portfolio Manager of Spartan
Massachusetts Municipal Money Market Fund on June 1, 1997.
Q. TANYA, WHAT WAS THE INVESTING ENVIRONMENT LIKE OVER THE PAST SIX MONTHS?
A. While the Federal Reserve Board in mid-1996 had indicated its bias
toward raising short-term interest rates to slow economic growth and head
off inflation, it had not acted by early 1997 and the market became
complacent with the steady Fed policy. That sentiment changed in late
February, however, after Fed Chairman Alan Greenspan's semiannual
Humphrey-Hawkins testimony before Congress. Greenspan explained his
concerns that low unemployment might exert upward pressure on the economy's
core inflation. More importantly, he mentioned the possibility that the Fed
might raise the rate banks charge each other for overnight loans - known as
the fed funds target rate - from the 5.25% level it had maintained since
January 1996. The reason behind such a move would be to raise rates to curb
inflation before it passed through to the consumer. Shortly after
Greenspan's remarks, data for February showed an additional 293,000
non-farm jobs had been added to the economy, lowering unemployment to 5.3%.
Interest rates rose as the Fed's March 25 Open Market Committee meeting
approached and fears intensified that there would be a shift in Fed policy.
At that meeting, the Fed raised the fed funds target rate by 0.25% to 5.50%
as expected.
Q. HOW HAS THE ECONOMY PERFORMED SINCE THE FED'S MARCH MEETING?
A. First quarter 1997 data pointed to continued economic strength, with
gross domestic product growing at a stronger-than-expected annual rate of
nearly 6%. In addition, unemployment fell in April to 4.9%, the lowest
level since 1973. Since then, economic data showed signs of diminishing
during the second quarter. Perhaps more importantly, inflation continued to
remain in check. In fact, in the first half of the year there were six
consecutive monthly drops in the producer price index, and the first half
of the year's consumer price index was the lowest in 10 years. Because of
this backdrop, the Fed chose not to change the fed funds target rate at its
latest meeting in early July.
Q. WHAT WAS THE FUND'S STRATEGY DURING THE PERIOD?
A. The fund's average maturity was 46 days at the end of the period. Given
the strong first quarter economic data that was released throughout the
spring, the fund's average maturity declined in anticipation of higher
interest rates. Attractive opportunities appeared in very-short-term
securities, including variable rate demand notes (VRDNs) and commercial
paper. VRDNs are variable rate securities that can be redeemed on short
notice, typically in one or seven days. Commercial paper is a promissory
note sold by tax-exempt issuers such as electric utilities to finance
capital needs, usually with a maturity of one to three months. For several
weeks, the average yield on VRDNs was equal to or in some cases even higher
than the yield on one-year notes. This situation enabled the fund to buy
attractive-yielding instruments without taking on the added risk of buying
one-year notes. At the end of the period, yields reverted to a more
historically normal relationship - with longer-term securities offering
higher yields than short-term notes. This came as a result of strong
reinvestment demand in the market that led to a drop in the yields on VRDNs
and commercial paper.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on July 31, 1997, was 3.17%, compared to
3.00% six months ago. The latest yield was the equivalent of a taxable
yield of 5.63% for Massachusetts investors in the 43.68% combined federal
and state tax bracket. The fund's cumulative total return during the
six-month period was 1.56%. That beat the total return of 1.50% for the
Massachusetts tax-free money market funds average, according to IBC
Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. Should the economy continue to exhibit healthy growth in the third and
fourth quarters of 1997, renewed inflation pressures could result, leading
to higher interest rates. Given this risk, I expect to manage the fund to
be able to take advantage of higher rates over the next six to 12 months. I
also expect to find opportunities in the market by taking advantage of
aberrations caused by technical factors, such as supply and demand
imbalances, seasonal factors and corporate buying trends, among others.
These factors can play out in a day, a week or over several months, and are
an important part of my ongoing strategy.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current tax-free
income for Massachusetts
residents while maintaining
a stable $1.00 share price
FUND NUMBER: 426
TRADING SYMBOL: FMSXX
START DATE: March 4, 1991
SIZE: as of July 31, 1997,
more than $663 million
MANAGER: Tanya Roy, since
June 1997; manager, various
Fidelity and Spartan
municipal money market
funds; joined Fidelity in 1989
(checkmark)
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND % OF FUND % OF FUND
ASSETS ASSETS ASSETS
7/31/97 1/31/97 7/31/96
0 - 30 68 67 70
31 - 90 17 12 12
91 - 180 5 10 3
181 - 397 10 11 15
WEIGHTED AVERAGE MATURITY
7/31/97 1/31/97 7/31/96
Spartan Massachusetts 46 days 52 days 59 days
Municipal Money Market Fund
Massachusetts Tax-Free 47 days 50 days 58 days
Money Market Funds
Average*
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JULY 31, 1997 AS OF JANUARY 31, 1997
Row: 1, Col: 1, Value: 2.6
Row: 1, Col: 2, Value: 23.0
Row: 1, Col: 3, Value: 2.6
Row: 1, Col: 4, Value: 17.0
Row: 1, Col: 5, Value: 55.0
Variable rate demand
notes (VRDNs) 46%
Commercial paper 27%
Tender bonds 3%
Municipal
notes 22%
Other 2%
Variable rate demand
notes (VRDN) 56%
Commercial paper 17%
Tender bonds 2%
Municipal
notes 23%
Other 2%
Row: 1, Col: 1, Value: 2.5
Row: 1, Col: 2, Value: 22.0
Row: 1, Col: 3, Value: 3.5
Row: 1, Col: 4, Value: 26.0
Row: 1, Col: 5, Value: 46.0
INVESTMENTS JULY 31, 1997 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 99.7%
Amherst-Pelham Reg'l. School Dist. BAN 4.45% 5/21/98 $ 1,500,000 $
1,503,926
Ashland Gen. Oblig. BAN 4.04% 3/5/98 1,500,000 1,500,334
Barnstable Gen. Oblig. BAN 4% 6/18/98 3,500,000 3,504,432
Bolton Gen. Oblig. BAN 4.50% 4/17/98 2,000,000 2,005,450
Boston Gen. Oblig. Bonds 5.25% 10/1/97 (MBIA Insured) 1,200,000 1,203,321
Boston Ind. Rev. (New Boston Seafood Center) Series 1997,
3.60%, LOC First Nat'l Bank of Boston, VRDN (b) 600,000 600,000
Boston Wtr. & Swr. Participating VRDN, Series 1996 SG-75,
3.75% (Liquidity Facility Societe Generale, France) (c) 5,100,000
5,100,000
Brockton Area Tran. Auth. RAN 4.25% 7/17/98 3,000,000 3,008,855
Brookline Gen. Oblig. BAN 4% 6/4/98 3,580,000 3,587,227
Chatham Gen. Oblig. BAN 4.25% 7/22/98 3,330,000 3,339,943
Clipper Participating VRDN, Series 93-2, 3.79%
(Liquidity Facility State Street Bank & Trust Co.) (c) 15,630,200
15,630,200
Easton Gen. Oblig. BAN:
4% 8/15/97 1,355,500 1,355,601
4.40% 10/3/97 4,715,000 4,719,545
4.40% 12/19/97 1,900,000 1,903,890
Everett Gen. Oblig. BAN:
4% 12/19/97 1,000,000 1,000,558
4.25% 12/19/97 1,000,000 1,001,488
Fall River Gen. Oblig. BAN 4.50% 8/15/97,
LOC State Street Bank & Trust Co. 1,910,000 1,910,420
Georgetown Gen. Oblig. BAN 4% 6/12/98,
LOC State Street Bank & Trust Co. 8,000,000 8,011,944
Gloucester Gen. Oblig. BAN 4.35% 8/8/97 7,500,000 7,500,442
Haverill Gen. Oblig. BAN 4.50% 8/1/97
(BPA Fleet Nat'l Bank) 2,000,000 2,000,000
Hopkinton Gen. Oblig. BAN 4% 12/30/97 2,500,000 2,504,978
Leominster Gen. Oblig. BAN 4% 12/17/97 (b) 1,900,000 1,901,853
Mansfield Gen. Oblig. BAN:
4.25% 8/21/97 1,230,000 1,230,394
4.25% 8/21/97 1,300,000 1,300,325
Marlborough Gen. Oblig. BAN 4% 12/18/97 2,300,000 2,303,635
Massachusetts Bay Tran. Auth.:
RAN:
Series 1997 A, 4.25% 2/27/98 13,500,000 13,548,185
4.75% 9/5/97 21,900,000 21,915,281
CP, Series C:
3.75% 8/7/97, LOC Westdeutsche Landesbank 1,000,000 1,000,000
3.75% 9/8/97, LOC Westdeutsche Landesbank 1,600,000 1,600,000
3.75% 10/14/97, LOC Westdeutsche Landesbank 1,600,000 1,600,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Bay Tran. Auth. Gen. Trans. Sys.
Participating VRDN Series 1995 A, 3.75%
(Liquidity Facilities Societe Generale France) (c) $ 6,000,000 $ 6,000,000
Massachusetts Dedicated Income Tax Rev. Series 1990 B,
3.60%, LOC Nat'l. Westminster, VRDN 4,950,000 4,950,000
Massachusetts Gen. Oblig. BAN Series 1997 A,
4.25% 3/1/98 4,735,000 4,749,651
Massachusetts Gen. Oblig. Participating VRDN (c):
Series 96C2101, 3.78% (Liquidity Facility Citibank, NY) 2,800,000
2,800,000
Series 97C2103, 3.73% (Liquidity Facility Citibank, NY) 5,700,000
5,700,000
Series 1993 A, 3.73% (Liquidity Facility Citibank, NY) 3,900,000
3,900,000
Series 1993 I, 3.78% (AMBAC Insured)
(BPA First Boston) (Liquidity Facility Citibank, NY) 7,800,000 7,800,000
Series 1996 SG-47, 3.75% (Liquidity Facility Societe
Generale, France) 2,000,000 2,000,000
3.65% (Liquidity Facility Bankers Trust Co.) 8,815,000 8,815,000
Massachusetts Health & Ed. Facs. Auth.
Participating VRDN (c):
(Harvard Univ.) Series P SG-27, 3.75%
(Liquidity Facility Societe Generale, France) 3,935,000 3,935,000
Series 13-C, 3.70% (AMBAC Insured)
(Liquidity Facility Morgan Guaranty Trust Co.) 3,700,000 3,700,000
Massachusetts Health & Ed. Facs. Auth. Rev.:
VRDN:
(Amherst College) Series F, 3.45% 10,000,000 10,000,000
(Cap. Asset Prog.):
Series B, 3.50% (MBIA Insured) (BPA Credit Suisse) 700,000 700,000
Series 1985 D, 3.65% (MBIA Insured)
(BPA Credit Suisse) 14,700,000 14,700,000
Series E, 3.75%, LOC First Nat'l. Bank of Chicago 5,000,000 5,000,000
(Harvard Univ.):
Series I, 3.45% 11,400,000 11,400,000
Series I, 3.45% 18,116,000 18,116,000
(Mount Ida College) 3.55%,
LOC Chase Manhattan Bank 2,700,000 2,700,000
(Partners Healthcare Sys.):
Series P-1, 3.50% (FSA Insured) (Liquidity Facility
Bayerische Landesbank Girozentale) 12,000,000 12,000,000
Series P-2, 3.55% (FSA Insured) (Liquidity Facility
Bayerische Landesbank Girozentale) 19,400,000 19,400,000
(Wellesley College) Series B, 3.50% 4,300,000 4,300,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Ed. Facs. Auth. Rev.: - continued
Bonds:
(Boston Univ.) Series H, 3.85%, tender 8/19/97,
LOC Landesbank Hessen-Thuringen, CP mode $ 7,600,000 $ 7,600,000
(Harvard Univ.):
3.75% 8/20/97, CP mode 1,600,000 1,600,000
3.75% 9/16/97, CP mode 6,400,000 6,400,000
Massachusetts Hsg. Fin. Agcy. Multi-Family Hsg. Rev. VRDN:
Rfdg. Series 1995 A, 3.50% (FNMA Guaranteed) 4,200,000 4,200,000
(Harbor Point Dev.) Series 1995 A, 3.55%,
(GNMA Guaranteed) LOC Republic Bank of New York 33,200,000 33,200,000
(Princeton Crossing Proj.) Series 1996, 3.60%,
LOC General Elec. Cap. Corp. (b) 8,700,000 8,700,000
Massachusetts Hsg. Fin. Agcy.:
Participating VRDN (c):
Series PA-132, 3.85%
(Liquidity Facility Merrill Lynch & Co., Inc.) (b) 1,000,000 1,000,000
Series PT-33, 3.80% (AMBAC Insured)
(Liquidity Facility Banque Nat'l. de Paris) (b) 1,500,000 1,500,000
Series PT-42, 3.65%
(Liquidity Facility Commerzbank, Germany) 3,905,000 3,905,000
Massachusetts Ind. Fin Agcy. Ind. Dev. Rev. VRDN:
Rfdg.:
(Baker School Specialty Co. Inc.) Series 1996, 3.50%,
LOC Fleet Nat'l. Bank (b) 2,200,000 2,200,000
(Brady Enterprises) Series 1996, 3.50%,
LOC Fleet Nat'l. Bank 1,550,000 1,550,000
(Falmouth Assisted Living) Series 1995, 3.60%,
LOC First Nat'l. Bank of Boston 1,900,000 1,900,000
(First Healthcare Corp. Proj.) Series 1992 B, 3.65%,
LOC Wachovia Bank of Georgia 1,130,000 1,130,000
(First Healthcare Corp. for Hillhaven Proj.) 3.65%,
LOC Wachovia Bank of Georgia 1,195,000 1,195,000
(WGBH Ed. Foundation Proj.) Series 1992, 3.50%,
LOC Nat'l. Westminster Bank PLC (a) 2,840,000 2,840,000
(Abbott Box Co.) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank (b) 2,425,000 2,425,000
(BBB Esq. LLC) Series 1996, 3.80%,
LOC First Nat'l Bank of Boston (b) 800,000 800,000
(Barker Steel Company) Series 1995, 3.60%,
LOC State Street Bank & Trust Co. (b) 800,000 800,000
(Battery Engineering, Inc.) Series 1996, 3.85%,
LOC Bank of Tokyo-Mitsubishi (b) 1,100,000 1,100,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin Agcy. Ind. Dev. Rev. VRDN: - continued
(Bradford College) Series 1995 A, 3.55%,
LOC First Nat'l. Bank of Boston $ 1,600,000 $ 1,600,000
(Buckingham Browne Nichols School) 3.50%,
LOC State Street Bank & Trust Co. 3,000,000 3,000,000
(Canton/Cedar Reality LLC) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank (b) 1,400,000 1,400,000
(Carand Realty Trust) Series 1997, 3.60%,
LOC State Street Bank & Trust Co. (b) 1,000,000 1,000,000
(Decas Cranberry Project) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank (b) 3,000,000 3,000,000
(Edgewood Retirement Commty.) Series 1995 C, 3.60%,
LOC Dresdner Bank, AG. 1,900,000 1,900,000
(General Signal Proj.) 3.65%,
LOC Wachovia Bank of Georgia 1,900,000 1,900,000
(Goddard House) 3.50%, LOC Fleet Nat'l Bank 2,500,000 2,500,000
(Governor Dummer Academy) Series 1996, 3.50%,
LOC State Street Bank & Trust Co. 1,200,000 1,200,000
(Hazen Paper Proj.) Series1996, 3.80%,
LOC First Nat'l. Bank of Boston (b) 900,000 900,000
(Heritage at Dartmouth) Series 1996, 3.55%,
LOC First National Bank of Boston (b) 825,000 825,000
(Heritage at Hingham) Series 1997, 3.55%,
LOC Fleet Nat'l. Bank (b) 2,500,000 2,500,000
(Lower Mills Associates II L.P.) Series 1995, 3.55%,
LOC First Nat'l. Bank of Boston 953,000 953,000
(Mary Ann Morse Nursing Home):
Series 1994 A, 3.80%, LOC ABN-AMRO Bank 3,200,000 3,200,000
Series 1994 B, 3.50%, LOC ABN-AMRO Bank 4,600,000 4,600,000
(Nova Realty) Series 1994, 3.55%
LOC First Nat'l. Bank of Boston 2,000,000 2,000,000
(Nutramax Products):
Series 1996, 3.60%,
LOC State Street Bank & Trust Co. (b) 1,000,000 1,000,000
Series 1996 B, 3.60%,
LOC State Street Bank & Trust Co. (b) 3,100,000 3,100,000
(Parker-Hannifin Corp. Proj.) Series 1997, 3.75%,
LOC Wachovia Bank of Georgia 1,800,000 1,800,000
(Riverdale Mills Corp.) Series 1995, 3.80%,
LOC Bank of Boston (b) 2,000,000 2,000,000
(Southern New England School of Law) 3.40%,
LOC Fleet Nat'l Bank 1,500,000 1,500,000
(United Medical Corp.) Series 1992, 3.55%,
LOC Chase Manhattan Bank (b) 1,300,000 1,300,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin Agcy. Ind. Dev. Rev. VRDN: - continued
(United Plastics) Series 1997 3.50%,
LOC Fleet Nat'l. Bank (b) $ 2,000,000 $ 2,000,000
(Univ. LLC) Series 1996, 3.80%,
LOC First Nat'l. Bank of Boston (b) 1,300,000 1,300,000
(Youville Place Inc.) Series 1996, 3.75%
(AMBAC Insured) (BPA Fleet Nat'l. Bank) 4,500,000 4,500,000
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev.:
Rfdg. Bonds (New England Power Co. Proj.):
Series 1992-B:
3.75% 8/12/97, CP mode 3,600,000 3,600,000
3.75% 8/21/97, CP mode 4,300,000 4,300,000
3.80% 9/8/97, CP mode 4,000,000 4,000,000
3.80% 9/8/97, CP mode 2,000,000 2,000,000
3.85% 9/9/97, CP mode 1,500,000 1,500,000
3.80% 9/17/97, CP mode 5,000,000 5,000,000
3.80% 10/16/97, CP mode 2,200,000 2,200,000
3.85% 10/22/97, CP mode 2,450,000 2,450,000
Series 1993-A:
3.70% 8/14/97, CP mode 2,000,000 2,000,000
3.85% 9/9/97, CP mode 4,500,000 4,500,000
3.80% 9/11/97, CP mode 5,800,000 5,800,000
Series 1993-B:
3.70% 8/20/97, CP mode 3,200,000 3,200,000
3.70% 8/26/97, CP mode 3,950,000 3,950,000
3.80% 9/11/97, CP mode 2,600,000 2,600,000
3.80% 10/16/97, CP mode 2,100,000 2,100,000
3.85% 10/22/97, CP mode 3,300,000 3,300,000
Massachusetts Ind. Find. Agcy. Poll. Cont. Rev. Rfdg.
(New England Power Co. Proj.)
Series 1992-B, 3.60%, VRDN 2,600,000 2,600,000
Massachusetts Ind. Fin. Agcy. Resource Recovery Rev.
(Ogden-Haverhill Proj.) Series 1986 B, 3.45%,
LOC Union Bank of Switzerland, VRDN (b) 3,300,000 3,300,000
Massachusetts Ind. Fin. Agcy. Participating VRDN,
(Holy Cross) Series 1996 SG-56, 3.75% (MBIA Insured)
(Liquidity Facility Societe Generale, France) (c) 7,025,000 7,025,000
Massachusetts Muni. Wholesale Elec. Co. Pwr. Supply Sys.
Rev Bonds Series 1994 C, 3.50%
LOC Canadian Imperial Bank of Commerce, VRDN 16,100,000 16,100,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Port Auth. Rev.:
Series 1995 A, 3.60%,
LOC Landesbanken Hessen-Thuringen, VRDN $ 900,000 $ 900,000
Series 1995 B, 3.65%,
LOC Landesbanken Hessen-Thuringen, VRDN (b) 8,900,000 8,900,000
Massachusetts Single Family Hsg. Auth. Bonds:
Series 50, 3.90%, tender 6/1/98 2,000,000 2,000,000
3.70%, tender 9/1/97
(Liquidity Facility Citibank, NY) (b)(c)(d) 3,600,000 3,600,000
Massachusetts Wtr. Poll. Abatement Rev. Bonds
(South Essex Swr. Dist. Loan Prog.) 5% 8/1/97 3,000,000 3,000,000
Massachusetts Wtr. Resolution Auth. Gen. Rev.
Bonds Series 1995 B, 5% 12/1/97 1,000,000 1,004,387
Massachusetts Wtr. Resource Auth.:
Series 1997-A, 3.50% (AMBAC Insured)
(Liquidity Facility Bank of Nova Scotia) VRDN 11,000,000 11,000,000
Series 1997-B, 3.50% (AMBAC Insured)
(Liquidity Facility Bank of Nova Scotia) VRDN 28,500,000 28,500,000
CP:
3.75% 8/14/97, LOC Morgan Guaranty Trust Co., NY 4,000,000 4,000,000
3.75% 8/19/97, LOC Morgan Guaranty Trust Co., NY 7,000,000 7,000,000
3.80% 9/10/97, LOC Morgan Guaranty Trust Co., NY 1,600,000 1,600,000
3.70% 9/11/97, LOC Morgan Guaranty Trust Co., NY 6,000,000 6,000,000
3.75% 9/11/97, LOC Morgan Guaranty Trust Co., NY 10,300,000 10,300,000
3.80% 9/12/97, LOC Morgan Guaranty Trust Co., NY 5,100,000 5,100,000
3.80% 9/15/97, LOC Morgan Guaranty Trust Co., NY 3,000,000 3,000,000
3.75% 9/17/97, LOC Morgan Guaranty Trust Co., NY 4,250,000 4,250,000
3.75% 9/18/97, LOC Morgan Guaranty Trust Co., NY 4,100,000 4,100,000
Massachusetts Wtr. Resource Auth. Participating VRDN:
Series 1995 SG-17, 3.75% (AMBAC Insured)
(Liquidity Facility Societe Generale, France) (c) 3,800,000 3,800,000
Series 1996, SG-63 3.75%
(Liquidity Facility Societe Generale, France) (c) 1,000,000 1,000,000
Medway Gen. Oblig. BAN 4% 9/19/97 3,000,000 3,001,380
Merrimack Valley Reg'l. Transit Auth. RAN 4.25% 6/19/98 2,400,000
2,406,709
Montachusetts Reg'l. Transit Auth. RAN 4.25% 6/26/98 2,800,000 2,808,375
Nantucket Gen. Oblig. BAN 4% 8/15/97 1,000,000 1,000,056
Natick Gen. Oblig. BAN:
4.50% 8/8/97 3,700,000 3,700,409
4.50% 8/8/97 2,400,000 2,400,302
North Andover Gen. Oblig. BAN 4% 1/9/98 1,775,000 1,776,884
Peabody Gen. Oblig. BAN 4.15% 8/15/97 2,700,000 2,700,299
Reading Gen. Oblig. BAN 4.25% 8/15/97 2,400,000 2,400,484
Seekonk Gen. Oblig. BAN 4% 11/19/97 3,200,000 3,204,660
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Springfield Gen. Oblig. BAN:
4.40% 6/26/97 (BPA Fleet Nat'l. Bank) $ 1,139,000 $ 1,143,437
4.25% 11/7/97 (BPA Fleet Nat'l. Bank) 6,000,000 6,007,869
4.30% 11/7/97 (BPA Fleet Nat'l. Bank) 3,000,000 3,003,928
4.10% 11/21/97 (BPA Fleet Nat'l. Bank) 3,000,000 3,002,951
Stoughton Gen. Oblig. BAN:
3.70% 8/29/97 1,014,160 1,014,327
4% 8/29/97 1,000,000 1,000,301
4.25% 8/29/97 1,200,000 1,200,274
Taunton Gen. Oblig. BAN 4% 12/3/97 2,100,000 2,102,269
Wakefield Gen. Oblig. BAN 4% 8/20/97 1,100,000 1,100,224
Walpole Gen. Oblig. BAN 4.15% 6/3/98 1,200,000 1,202,905
West Springfield Gen. Oblig. BAN 3.75% 3/5/98 9,132,000 9,139,782
Westfield Gen. Oblig. BAN 4.10% 3/26/98 1,000,000 1,000,922
Worcester Gen. Oblig. BAN:
4% 8/28/97 4,900,000 4,901,444
4.30% 8/28/97 1,080,000 1,080,239
659,860,695
PUERTO RICO - 0.3%
Puerto Rico Elec. Pwr. Auth. Rev. Participating VRDN
Series 1995-Z, 3.40% (Liquidity Facility Merrill
Lynch & Co., Inc.) (c) 1,700,000 1,700,000
TOTAL INVESTMENTS - 100% $ 661,560,695
Total Cost for Income Tax Purposes $ 661,560,605
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Notes
CP - Commercial Paper
RAN - Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
1. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
2. Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
3. Provides evidence of ownership in one or more underlying municipal
bonds.
4. Restricted securities - Investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST
Massachusetts Single
Family Hsg. Auth. Bonds
3.70%, tender 9/1/97
(AMBAC Insured)
(Liquidity Facility
Citibank, NY) 6/1/97 $ 3,600,000
INCOME TAX INFORMATION
At January 31, 1997, the fund had a capital loss carryforward of
approximately $56,000 of which $8,000, $8,000, and $40,000 will expire on
January 31, 2003, 2004, and 2005, respectively.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
JULY 31, 1997 (UNAUDITED)
ASSETS
Investment in securities, at value - $ 661,560,695
See accompanying schedule
Cash 1,109,053
Interest receivable 5,899,096
TOTAL ASSETS 668,568,844
LIABILITIES
Payable for investments purchased $ 5,000,000
Distributions payable 39,953
Accrued management fee 278,860
Other payables and accrued expenses 5,282
TOTAL LIABILITIES 5,324,095
NET ASSETS $ 663,244,749
Net Assets consist of:
Paid in capital $ 663,300,769
Accumulated net realized gain (loss) on investments (56,020)
NET ASSETS, for 663,299,344 shares outstanding $ 663,244,749
NET ASSET VALUE, offering price and redemption price per $1.00
share ($663,244,749 (divided by) 663,299,344 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED JULY 31, 1997 (UNAUDITED)
INTEREST INCOME $ 11,848,143
EXPENSES
Management fee $ 1,630,662
Non-interested trustees' compensation 1,623
Total expenses before reductions 1,632,285
Expense reductions (14,090) 1,618,195
NET INTEREST INCOME 10,229,948
REALIZED AND UNREALIZED GAIN (LOSS) (1,650)
Net realized gain (loss) on investment securities
Increase (decrease) in net unrealized gain from (2,930)
accretion of discount
NET GAIN (LOSS) (4,580)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 10,225,368
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR ENDED
ENDED JULY JANUARY 31,
31,1997 1997
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 10,229,948 $ 17,028,668
Net interest income
Net realized gain (loss) (1,650) (39,956)
Increase (decrease) in net unrealized gain from (2,930) 2,930
accretion of discount
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 10,225,368 16,991,642
FROM OPERATIONS
Distributions to shareholders from net interest income (10,229,948) (17,028,668)
Share transactions at net asset value of $1.00 per share 371,319,166 831,825,582
Proceeds from sales of shares
Reinvestment of distributions from net interest income 10,062,324 16,774,462
Cost of shares redeemed (389,594,390) (691,592,516)
NET INCREASE (DECREASE) IN NET ASSETS AND SHARES (8,212,900) 157,007,528
RESULTING FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS (8,217,480) 156,970,502
NET ASSETS
Beginning of period 671,462,229 514,491,727
End of period $ 663,244,749 $ 671,462,229
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED JANUARY 31, SIX MONTHS YEAR ENDED
ENDED JULY 31, ENDED JULY 31,
1997 JANUARY 31,
(UNAUDITED) 1997 1996 1995 1994 1993 1992
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .016 .030 .033 .024 .019 .012 .034
Net interest income
Less Distributions
From net interest income (.016) (.030) (.033) (.024) (.019) (.012) (.034)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 1.56% 3.00% 3.32% 2.42% 1.95% 1.23% 3.45%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 663,245 $ 671,462 $ 514,492 $ 406,287 $ 346,880 $ 333,655 $ 278,369
Ratio of expenses to average net assets .50% A .50% .50% .50% .40% C .17% A, C .05%
C
Ratio of net interest income to average
net assets 3.13% A 2.96% 3.27% 2.40% 1.93% 2.44% A 3.29%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE AND FOR PERIODS
LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE TOTAL RETURNS WOULD HAVE BEEN
LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN.
C FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE
BEEN HIGHER.
NOTES TO FINANCIAL STATEMENTS
For the period ended July 31, 1997 (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES.
Spartan Massachusetts Municipal Money Market Fund (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 financial statements have been prepared in conformity with generally
accepted accounting principles which permit management to make certain
estimates and assumptions at the date of the financial statements. 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 substantially 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. OPERATING POLICIES.
RESTRICTED SECURITIES. The fund is permitted to invest in securities that
are subject to legal or contractual restrictions on resale. These
securities generally may be resold in transactions exempt from registration
or to the public if the securities are registered. Disposal of these
securities may involve time-consuming negotiations and expense, and prompt
sale at an acceptable price may be difficult. At the end of the period,
restricted securities (excluding 144A issues) amounted to $3,600,000 or .5%
of net assets.
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, Fidelity Management &
Research Company (FMR) pays all expenses, except the compensation of the
non-interested Trustees and certain exceptions such as interest, taxes,
brokerage commissions and extraordinary
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
MANAGEMENT FEE - CONTINUED
expenses. FMR receives a fee that is computed daily at an annual rate of
.50% of the fund's average net assets.
FMR also bears the cost of providing shareholder services to the fund. To
offset the cost of providing these services, FMR or its affiliates collect
certain transaction fees from the fund's shareholders which amounted to
$3,353 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.
4. EXPENSE REDUCTIONS.
FMR has entered into arrangements on behalf of the fund with the fund's
custodian and transfer agent whereby credits realized as a result of
uninvested cash balances were used to reduce a portion of the fund's
expenses. During the period, the fund's expenses were reduced by $14,090
under these arrangements.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a day.
BY PHONE
Fidelity TouchTone Xpressprovides a single toll-free number to access
account balances, positions, quotes and trading. It's easy to navigate the
service, and on your first call, the system will help you create a personal
identification number (PIN) for security.
SM
(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
1
For quotes.*
2
For account balances and holdings.
3
To review orders and mutual
fund activity.
4
To change your PIN.
5
To speak to a Fidelity representative.
*
0
BY PC
Fidelity's Web site on the Internet provides a wide range of information,
including daily financial news, fund performance, interactive planning
tools and news about Fidelity products and services.
(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at 1-800-544-7272
for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity at
1-800-544-7272 or visit our Web site for more information on how to manage
your investments via your PC.
* 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
INVESTMENT SUB-ADVISER
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Fred L. Henning, Jr., Vice President
Boyce Greer, Vice President
Arthur S. Loring, Secretary
Richard A. Silver, Treasurer
Thomas D. Maher, Assistant
Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Edward C. Johnson 3d
Robert M. Gates *
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
UMB Bank, n.a.
Kansas City, MO
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
UMB Bank, n.a.
Kansas City, MO
FIDELITY'S MUNICIPAL
MONEY MARKET FUNDS
California Municipal Money Market
Connecticut Municipal Money Market
Massachusetts Municipal Money Market
Michigan Municipal Money Market
Municipal Money Market
New Jersey Municipal Money Market
New York Municipal Money Market
Ohio Municipal Money Market
Spartan Arizona 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
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
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)
TouchTone Xpress 1-800-544-5555
SM
* INDEPENDENT TRUSTEES
AUTOMATED LINE FOR QUICKEST SERVICE
SPARTAN(registered trademark)
(registered trademark)
MASSACHUSETTS MUNICIPAL
INCOME FUND
(FORMERLY FIDELITY MASSACHUSETTS
MUNICIPAL INCOME FUND)
AND
FIDELITY
MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND
SEMIANNUAL REPORT
JULY 31, 1997
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
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 24 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
PERFORMANCE 28 How the fund has done over time.
FUND TALK 30 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 32 A summary of major shifts in the
fund's investments over the past six
months
and one year.
INVESTMENTS 33 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 41 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
NOTES 45 Notes to the financial statements.
</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,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS 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.
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)DEAR SHAREHOLDER:
Through the first seven months of 1997, stock and bond markets experienced
the kind of short-term volatility that can affect them periodically. The
stock market rebounded strongly from its early spring correction to
continue on its record-setting pace, as seen by the roughly 30%
year-to-date gain by the Standard & Poor's 500 Index. The bond market
posted moderate returns over the past seven months, as positive news on the
inflation front helped soften the effects of a hike in short-term interest
rates by the Federal Reserve Board in late March.
While it's impossible to predict the future direction of the markets with
any degree of certainty, there are certain basic principles that can help
investors plan for their future needs.
The longer your investment time frame, the less likely it is that you will
be affected by short-term market volatility. A 10-year investment horizon
appropriate for saving for a college education, for example, enables you to
weather market cycles in a long-term fund, which may have a higher risk
potential, but also has a higher potential rate of return.
An intermediate-length fund could make sense if your investment horizon is
two to four years, while 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. These funds seek
income and a stable share price by investing in high-quality, short-term
investments. Of course, it's important to remember that there is no
assurance that a money market fund will achieve its goal of maintaining a
stable net asset value of $1.00 per share, and that these types of funds
are neither insured nor guaranteed by any agency of the U.S. government.
Finally, no matter what your time horizon or portfolio diversity, it makes
good sense to follow a regular investment plan, investing a certain amount
of money in a fund at the same time each month or quarter and periodically
reviewing your overall portfolio. By doing so, you won't get caught up in
the excitement of a rapidly rising market, nor will you buy all your shares
at market highs. While this strategy - known as dollar cost averaging -
won't assure a profit or protect you from a loss in a declining market, it
should help you lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are available
24 hours a day, seven days a week to provide you the information you need
to make the investments that are right for you.
Best regards,
Edward C. Johnson 3d
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
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. Total return
reflects the change in the value of an investment, assuming reinvestment of
the fund's dividend income and capital gains (the profits earned upon the
sale of securities that have grown in value). You can also look at the
fund's income, as reflected in its yield, to measure performance.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JULY 31, 1997 PAST 6 PAST 1 PAST 5 PAST 10
MONTHS YEAR YEARS YEARS
Spartan 5.95% 10.07% 39.55% 116.33%
Massachusetts Municipal Income Fund
Lehman Brothers Massachusetts Enhanc 5.58% 9.86% n/a n/a
ed
Municipal Bond Index
Massachusetts Municipal Debt Funds Average 5.57% 9.47% 36.46% 111.84%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be $1,050.
You can compare the fund's returns to the performance of the Lehman
Brothers Massachusetts Enhanced Municipal Bond Index, - a total return
performance benchmark for Massachusetts investment-grade municipal bonds
with maturities of at least one year. To measure how the fund's performance
stacked up against its peers, you can compare it to the Massachusetts
municipal debt funds average, which reflects the performance of mutual
funds with similar objectives tracked by Lipper Analytical Services, Inc.
The past six months average represents a peer group of 54 mutual funds.
These benchmarks include reinvested dividends and capital gains, if any,
and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JULY 31, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Spartan Massachusetts Municipal Income Fund 10.07% 6.89% 8.02%
Lehman Brothers Massachusetts Enhanc 9.86% n/a n/a
ed
Municipal Bond Index
Massachusetts Municipal Debt Funds Average 9.47% 6.41% 7.79%
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking the arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19970731 19970812 100737 S00000000000001
Spartan MA Muni Income LB Municipal Bond
00070 LB015
1987/07/31 10000.00 10000.00
1987/08/31 10035.31 10022.50
1987/09/30 9627.94 9652.97
1987/10/31 9499.54 9687.14
1987/11/30 9745.57 9940.07
1987/12/31 9946.75 10084.30
1988/01/31 10260.00 10443.51
1988/02/29 10377.92 10553.89
1988/03/31 10196.80 10431.47
1988/04/30 10279.89 10510.75
1988/05/31 10334.86 10480.37
1988/06/30 10446.55 10633.70
1988/07/31 10520.46 10703.03
1988/08/31 10556.61 10712.45
1988/09/30 10710.29 10906.35
1988/10/31 10903.76 11098.30
1988/11/30 10840.88 10996.64
1988/12/31 11008.17 11109.13
1989/01/31 11165.74 11338.87
1989/02/28 11092.59 11209.49
1989/03/31 11100.63 11182.70
1989/04/30 11373.35 11448.18
1989/05/31 11575.76 11685.96
1989/06/30 11674.53 11844.65
1989/07/31 11764.09 12005.86
1989/08/31 11718.46 11888.32
1989/09/30 11673.64 11852.90
1989/10/31 11784.22 11997.86
1989/11/30 11951.14 12207.82
1989/12/31 12026.06 12307.68
1990/01/31 11967.13 12249.46
1990/02/28 12115.30 12358.48
1990/03/31 12136.10 12362.19
1990/04/30 11976.75 12272.69
1990/05/31 12237.30 12540.60
1990/06/30 12365.52 12650.83
1990/07/31 12540.30 12836.80
1990/08/31 12389.87 12650.41
1990/09/30 12431.36 12657.62
1990/10/31 12473.80 12887.23
1990/11/30 12859.28 13146.39
1990/12/31 12914.11 13203.58
1991/01/31 13073.68 13380.77
1991/02/28 13173.96 13497.18
1991/03/31 13239.59 13502.04
1991/04/30 13423.09 13681.62
1991/05/31 13558.32 13803.25
1991/06/30 13585.09 13789.58
1991/07/31 13781.95 13957.54
1991/08/31 13907.50 14141.36
1991/09/30 14035.35 14325.48
1991/10/31 14160.45 14454.41
1991/11/30 14197.95 14494.74
1991/12/31 14374.12 14805.80
1992/01/31 14499.17 14839.55
1992/02/29 14545.37 14844.30
1992/03/31 14559.72 14849.80
1992/04/30 14689.02 14981.96
1992/05/31 14849.34 15158.30
1992/06/30 15096.28 15412.65
1992/07/31 15502.18 15874.72
1992/08/31 15307.16 15719.95
1992/09/30 15437.48 15822.75
1992/10/31 15176.68 15667.22
1992/11/30 15560.81 15947.82
1992/12/31 15709.28 16110.64
1993/01/31 15940.24 16298.01
1993/02/28 16488.66 16887.51
1993/03/31 16339.50 16709.01
1993/04/30 16489.64 16877.60
1993/05/31 16601.50 16972.45
1993/06/30 16863.04 17255.72
1993/07/31 16851.27 17278.33
1993/08/31 17202.90 17638.06
1993/09/30 17496.74 17838.96
1993/10/31 17539.74 17873.39
1993/11/30 17395.63 17715.93
1993/12/31 17739.06 18089.91
1994/01/31 17944.06 18296.50
1994/02/28 17568.57 17822.62
1994/03/31 16812.54 17096.88
1994/04/30 16869.20 17241.86
1994/05/31 17035.27 17391.35
1994/06/30 16955.95 17285.09
1994/07/31 17276.39 17601.92
1994/08/31 17352.44 17662.83
1994/09/30 17070.01 17403.54
1994/10/31 16726.36 17094.45
1994/11/30 16254.33 16785.38
1994/12/31 16661.67 17154.83
1995/01/31 17263.90 17645.11
1995/02/28 17747.52 18158.23
1995/03/31 17985.34 18366.87
1995/04/30 17994.07 18388.54
1995/05/31 18557.16 18975.32
1995/06/30 18270.91 18810.24
1995/07/31 18394.59 18988.56
1995/08/31 18618.04 19229.33
1995/09/30 18772.64 19351.05
1995/10/31 19078.80 19632.42
1995/11/30 19414.10 19958.12
1995/12/31 19672.65 20149.92
1996/01/31 19811.93 20302.05
1996/02/29 19605.72 20165.01
1996/03/31 19337.89 19907.30
1996/04/30 19252.88 19850.96
1996/05/31 19256.01 19843.02
1996/06/30 19445.15 20059.11
1996/07/31 19654.19 20241.65
1996/08/31 19620.90 20236.79
1996/09/30 19882.24 20520.11
1996/10/31 20111.03 20752.19
1996/11/30 20479.49 21131.96
1996/12/31 20380.32 21043.20
1997/01/31 20418.50 21082.97
1997/02/28 20608.57 21276.52
1997/03/31 20324.06 20992.90
1997/04/30 20503.17 21168.61
1997/05/31 20812.74 21486.99
1997/06/30 21029.49 21715.82
1997/07/31 21632.56 22317.35
IMATRL PRASUN SHR__CHT 19970731 19970812 100740 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was invested
in Spartan Massachusetts Municipal Income Fund on July 31, 1987. As the
chart shows, by July 31, 1997, the value of the investment would have grown
to $21,633 - a 116.33% increase on the initial investment. For comparison,
look at how the Lehman Brothers Municipal Bond Index - which reflects the
performance of the investment-grade municipal bond market - did over the
same period. With dividends and capital gains, if any, reinvested, the same
$10,000 would have grown to $22,317 - a 123.17% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, generally 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
SIX MONTHS YEARS ENDED JANUARY 31,
ENDED
JULY 31,
1997 1997 1996 1995 1994 1993
Dividend return 2.71% 5.33% 6.41% 5.85% 6.32% 6.67%
Capital appreciation return 3.24% -2.27% 8.35% -9.64% 6.25% 3.27%
Total return 5.95% 3.06% 14.76% -3.79% 12.57% 9.94%
TOTAL RETURN COMPONENTS include both dividend returns and capital
appreciation returns. 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 capital gains paid
by the fund are reinvested, if any.
DIVIDENDS AND YIELD
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED JULY 31, 1997 PAST 1 PAST 6 PAST 1
MONTH MONTHS YEAR
Dividends per share 5.04(cents) 29.79(cents) 60.02(cents)
Annualized dividend rate 5.08% 5.24% 5.25%
30-day annualized yield 4.63% - -
30-day annualized tax-equivalent yield 8.22% - -
</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 $ 11.69 over
the past one month, $11.47 over the past six months and $11.43 over the
past one year, you can compare the fund's income over these three periods.
Dividends per share show the income paid by the fund for a set period and
do not reflect any tax reclassifications. 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 1997 federal and state tax bracket, but does not reflect the
payment of the alternative minimum tax, if applicable.
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: Jonathan Short became Portfolio Manager of Spartan
Massachusetts Municipal Income Fund on April 1, 1997.
Q. HOW DID THE FUND PERFORM, JON?
A. The fund did pretty well, outperforming its competitors and its
benchmark. For the six-month period that ended July 31, 1997, the fund had
a total return of 5.95%. To get a sense of how the fund did relative to its
competitors, the Massachusetts municipal debt funds average returned 5.57%
for the same six-month period, as tracked by Lipper Analytical Services.
Additionally, the Lehman Brothers Massachusetts Enhanced Municipal Bond
Index returned 5.58% over the past six months. For the 12-month period that
ended July 31, 1997, the fund had a total return of 10.07%, the
Massachusetts municipal debt funds average returned 9.47%, according to
Lipper, and the index returned 9.86%.
Q. THE BOND MARKET TURNED FROM SKITTISH TO OPTIMISTIC OVER THE PAST SIX
MONTHS. WHAT ACCOUNTED FOR THE MARKET'S CHANGING SENTIMENT?
A. As the period wore on, market participants began to worry less about
inflation. Bond investors, of course, dislike even the threat of inflation
because it can eat away at the fixed-income payments their bonds generate.
Early in the period, investors were worried that the economy was growing at
too quick a pace - and much faster than anticipated. As a result, investors
sent bond yields higher and bond prices lower. While there weren't any
tangible signs that inflation was on the upswing, there were concerns that
the Federal Reserve Board would raise interest rates as an
anti-inflationary measure sometime down the road. But in late spring, bond
investors became more optimistic on evidence that the economy was growing
at a moderate pace with little inflationary pressure. In July, the market
was further cheered by Fed Chairman Alan Greenspan, who testified before
Congress that inflation didn't appear to be a problem, implying that
further interest rate hikes didn't appear to be on the horizon.
Q. WHY DID THE FUND PERFORM BETTER THAN THE AVERAGE FUND OF ITS TYPE AND
ITS BENCHMARK INDEX?
A. It's difficult to know for certain at least with the peer group, but I
think it comes down to a couple of factors. First, the fund's relatively
large stake in noncallable bonds performed very well during the period.
Noncallable bonds can't be redeemed by their issuer before maturity.
Issuers often are prompted to refinance their older, more expensive debt if
current rates are lower than they're paying on existing bonds. Noncallable
bonds tend to do better than callable bonds when interest rates fall.
Furthermore, the prices of many of the fund's noncallable holdings rose
during the past six months as investors increasingly sought out bonds with
call protection.
Q. AND THE SECOND FACTOR?
A. To the benefit of the fund, some of our holdings in general obligation
bonds issued by the state were advance refunded. With an advance refunding,
an issuer with existing bonds in the market will issue a second set of
bonds. Proceeds from this sale are then invested in high-quality U.S.
Treasury securities, and these Treasuries then secure the original bonds
until their call date.
Q. HAVE YOU MADE ANY SIGNIFICANT CHANGES SINCE TAKING OVER THE FUND?
A. No. My basic strategy is similar to that of the previous manager. I
continued to keep the fund's duration - which measures how sensitive it is
to changes in interest rates - in line with the Massachusetts market as a
whole, as reflected by the fund's benchmark index. I believe that,
practically speaking, it has proved to be very difficult to predict where
interest rates are headed with consistency over a long period of time.
Although I didn't make any large strategic moves, I did modify the way the
fund was allocated among bonds with various maturities as a function of
where I found the best value. In my view, longer-term bonds with maturities
of more than 20 years didn't offer enough yield advantage over shorter-term
bonds to compensate for their added interest rate sensitivity. In my view,
the better risk/reward payoff was found in intermediate bonds, those with
maturities of between 10 and 20 years. So I sold some long-term bonds and
replaced them with shorter-term maturities.
Q. HEALTH CARE WAS THE FUND'S SECOND LARGEST SECTOR CONCENTRATION AT THE
END OF THE PERIOD. SINCE THIS SECTOR IS FACING UNIQUE CHALLENGES, HOW DID
YOU CHOOSE WHICH INVESTMENTS WERE APPROPRIATE FOR THE FUND?
A. In the health care sector, the main challenges were consolidation,
cost-cutting and competition. I emphasized health care facilities that I
believed were well-positioned in their service area and that had strong
relationships with doctors and various payers, including insurance
companies as well as the state and federal governments. With input from
Fidelity's research analysts, I targeted hospitals with strong market
share, sensible balance sheets and effective management teams. Health care
bonds typically offer high yields relative to other sectors, which is one
reason why I thought they were attractive investments for the fund.
Q. WHAT'S YOUR OUTLOOK?
A. From a supply and demand standpoint, I'm optimistic about municipals in
Massachusetts. I don't expect to see a tremendous amount of new bonds
issued, and the increase in supply we're likely to see could easily be
digested if demand remains firm. How municipals will fare over the next six
months will depend heavily on the direction of interest rates. That said,
we may continue to see some volatility in the bond market as long as there
are conflicting signs about the economy and inflation trends.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: to provide high current
income exempt from federal
income tax and
Massachusetts personal
income taxes by investing in
investment-grade municipal
securities under normal
conditions
FUND NUMBER: 070
TRADING SYMBOL: FDMMX
START DATE: November 10, 1983
SIZE: as of July 31, 1997,
more than $1.1 billion
MANAGER: Jonathan Short,
since April 1997; manager,
various Fidelity and Spartan
municipal income funds;
joined Fidelity in 1990
(checkmark)
JON SHORT ON THE STATE'S
FISCAL SITUATION:
"The strength of the
Massachusetts economy has
continued to bolster the
state's fiscal situation. Not
only are personal and
corporate tax revenues up,
but the state's recent tax cuts
have helped it to attract new
businesses. However, the
problems surrounding the `Big
Dig' have the potential to
detract from the state's
current fiscal health. Recently,
the federal General
Accounting Office set the cost
of the project at over $11
billion - well in excess of
original budget projections.
This development underscored
the need for the state to come
up with a plan to pay its share
of the project. Furthermore,
potential cutbacks in federal
support of highway projects
such as the `Big Dig' could
bring additional pressure on
the state's budget."
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF JULY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE SECTORS
6 MONTHS AGO
General Obligation 27.9 26.2
Health Care 21.1 20.9
Water & Sewer 13.0 11.1
Education 9.9 11.7
Electric Revenue 6.2 5.6
AVERAGE YEARS TO MATURITY AS OF JULY 31, 1997
6 MONTHS AGO
Years 14.3 15.3
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 JULY 31, 1997
6 MONTHS AGO
Years 6.7 6.9
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 THIS EXAMPLE.
QUALITY DIVERSIFICATION (MOODY'S RATINGS)
AS OF JULY 31, 1997 AS OF JANUARY 31, 1997
Aaa 36.6%
Aa, A 49.2%
Baa 8.7%
Non-rated 3.3%
Short-term
investments 2.2%
Aaa 31.2%
Aa, A 53.4%
Baa 9.9%
Non-rated 3.9%
Short-term
investments 1.6%
Row: 1, Col: 1, Value: 36.6
Row: 1, Col: 2, Value: 49.2
Row: 1, Col: 3, Value: 8.699999999999999
Row: 1, Col: 4, Value: 3.3
Row: 1, Col: 5, Value: 2.2
Row: 1, Col: 1, Value: 31.2
Row: 1, Col: 2, Value: 53.0
Row: 1, Col: 3, Value: 9.9
Row: 1, Col: 4, Value: 3.9
Row: 1, Col: 5, Value: 1.6
WHERE MOODY'S RATINGS ARE NOT AVAILABLE, WE HAVE USED S&P RATINGS. AMOUNTS
SHOWN ARE
AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
INVESTMENTS JULY 31, 1997 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
MUNICIPAL BONDS - 97.8%
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - 95.1%
Amherst Gen. Oblig.:
6.50% 1/15/08 Aa $ 795,000 $ 869,531
6.50% 1/15/09 Aa 770,000 838,338
6.50% 1/15/10 Aa 750,000 815,625
Attleboro Gen. Oblig.:
6% 10/1/03 (MBIA Insured) Aaa 1,085,000 1,179,938
6% 10/1/04 (MBIA Insured) Aaa 1,085,000 1,185,363
6% 10/1/05 (MBIA Insured) Aaa 1,085,000 1,193,500
6% 10/1/06 (MBIA Insured) Aaa 1,085,000 1,200,281
6% 10/1/07 (MBIA Insured) Aaa 1,085,000 1,204,350
Barnstable Ind. Dev. Fing. Auth. Ind. Dev. Rev.
(Whitehall Pavilion Health Proj.)
10.125% 2/15/26 (FHA Guaranteed) A 2,980,000 3,070,026
Bellingham Gen. Oblig.:
7.50% 7/1/06
(Pre-Refunded to 7/1/01 @ 103) (d) A 310,000 354,950
7.50% 7/1/07
(Pre-Refunded to 7/1/01 @ 103) (d) A 310,000 354,950
7.50% 7/1/08
(Pre-Refunded to 7/1/01 @ 103) (d) A 310,000 354,950
7.50% 7/1/09
(Pre-Refunded to 7/1/01 @ 103) (d) A 310,000 354,950
7.50% 7/1/10
(Pre-Refunded to 7/1/01 @ 103) (d) A 310,000 354,950
7.50% 7/1/11
(Pre-Refunded to 7/1/01 @ 103) (d) A 300,000 343,500
Boston Econ. Dev. & Ind. Corp.
(Boston Army Base 1983 Proj.)
6.25% 8/1/03 (LOC State Street
Bank & Trust Co.) AA 4,440,000 4,573,378
Boston Gen. Oblig.:
Series A, 7% 2/1/00 (AMBAC Insured) Aaa 2,060,000 2,201,625
10% 7/1/00 (MBIA Insured) Aaa 1,000,000 1,157,500
Boston Hsg. Dev. Corp. Mtg. Rev. Rfdg. Series A,
5.15% 7/1/08 (MBIA Insured)
(FHA Guaranteed) Aaa 3,145,000 3,176,450
Boston Ind. Dev. Rev.
(North End Commty. Nursing Home)
11.45% 3/15/25 (FHA Guaranteed) AA 4,795,000 5,294,399
Boston Wtr. & Swr. Commission Rev. Gen. Sr.
Series A, 5.25% 11/1/19 A2 10,100,000 10,175,750
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Brockton Hsg. Dev. Corp. Multi-Family Hsg.
Rev. Rfdg. (Douglas House Proj.) Series 1992 A,
7.375% 9/1/24 (FNMA Coll.) Aaa $ 8,215,000 $ 8,687,363
Chelsea School Proj. Loan Act 1948:
6.50% 6/15/12 (AMBAC Insured) Aaa 2,500,000 2,784,375
6% 6/15/14 (AMBAC Insured) Aaa 1,830,000 1,969,538
Dighton & Rehoboth Reg'l. School Dist.:
5.40% 5/15/10 (AMBAC Insured) Aaa 385,000 397,513
5.40% 5/15/11 (AMBAC Insured) Aaa 185,000 190,550
5.40% 5/15/12 (AMBAC Insured) Aaa 225,000 230,625
Granville Gen. Oblig.:
7.30% 7/15/05 (MBIA Insured) Aaa 145,000 172,369
7.30% 7/15/06 (MBIA Insured) Aaa 145,000 174,725
7.30% 7/15/07 (MBIA Insured) Aaa 140,000 170,625
7.30% 7/15/08 (MBIA Insured) Aaa 140,000 171,675
Halifax Gen. Oblig.:
6.20% 6/1/10 (AMBAC Insured) Aaa 325,000 359,125
6.25% 6/1/11 (AMBAC Insured) Aaa 325,000 359,125
6.30% 6/1/12 (AMBAC Insured) Aaa 325,000 360,344
6.30% 6/1/13 (AMBAC Insured) Aaa 325,000 360,344
Haverhill Rfdg. Series A:
6.40% 9/1/03 (AMBAC Insured) Aaa 1,600,000 1,750,000
6.50% 9/1/04 (AMBAC Insured) Aaa 1,595,000 1,744,531
Holyoke Gen. Oblig.:
Series A:
5.50% 6/15/04 (FSA Insured) Aaa 1,255,000 1,331,869
6% 6/15/05 (FSA Insured) Aaa 1,350,000 1,483,313
6% 6/15/06 (FSA Insured) Aaa 1,300,000 1,436,500
5.50% 6/15/16 (FSA Insured) Aaa 2,100,000 2,168,250
Series B:
5.50% 6/15/04 (FSA Insured) Aaa 2,015,000 2,138,419
6% 6/16/06 (FSA Insured) Aaa 1,400,000 1,547,000
Holyoke School Proj. Loan Act:
7.35% 8/1/02 Baa 2,270,000 2,499,838
7.65% 8/1/09 Baa 2,205,000 2,431,013
Leicester Gen. Oblig. Unltd. Tax:
5% 1/15/11 (MBIA Insured) Aaa 515,000 515,644
5.10% 1/15/13 (MBIA Insured) Aaa 305,000 306,144
5.10% 1/15/14 (MBIA Insured) Aaa 500,000 500,625
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Lowell Gen. Oblig.:
Rfdg. Series A, 5.50% 1/15/10 (FSA Insured) Aaa $ 2,000,000 $ 2,077,500
Ltd. Tax:
8% 1/15/00 Baa1 750,000 783,750
6.25% 8/1/04 (AMBAC Insured) Aaa 2,035,000 2,261,394
6.25% 8/1/05 (AMBAC Insured) Aaa 2,120,000 2,369,100
5.80% 4/1/08 (FSA Insured) Aaa 1,195,000 1,292,094
8.40% 1/15/09 Aaa 1,250,000 1,439,063
7.625% 2/15/10
(Pre-Refunded to 2/15/01 @ 103) (d) Aaa 1,650,000 1,883,063
Lowell Hsg. Dev. Corp. Multi-Family Rev.:
Rfdg. Series A, 7.875% 11/1/24 (FNMA Coll.) - 5,440,000 5,773,200
7.875% 11/1/00 (FNMA Coll.) - 525,000 551,250
Lynn Wtr. & Swr. Commission Rfdg.:
5.35% 12/1/07 (FGIC Insured) Aaa 760,000 797,050
5.40% 12/1/08 (FGIC Insured) Aaa 805,000 842,231
5.45% 12/1/09 (FGIC Insured) Aaa 850,000 886,125
5.50% 12/1/10 (FGIC Insured) Aaa 500,000 520,625
Massachusetts Bay Trans. Auth.:
Rfdg. (Gen. Trans. Sys.) Series A:
7% 3/1/08 A1 1,000,000 1,193,750
5.50% 3/1/12 A1 4,350,000 4,594,688
6.25% 3/1/12 A1 1,500,000 1,700,625
7% 3/1/21 A1 1,500,000 1,876,875
Rfdg. Series B:
6% 3/1/12 A1 7,440,000 7,895,700
6.20% 3/1/16 A1 27,500,000 30,937,500
5.50% 3/1/21 A1 5,000,000 5,056,250
(Gen. Trans. Sys.) Series A:
5.50% 3/1/04 (FGIC Insured) Aaa 2,000,000 2,115,000
6.25% 3/1/05 A1 2,780,000 3,089,275
5.70% 3/1/09 A1 5,000,000 5,418,750
5.80% 3/1/11 A1 6,435,000 7,006,106
6% 3/1/11 (FGIC Insured) Aaa 5,660,000 6,134,025
5.80% 3/1/12 A1 3,000,000 3,262,500
Massachusetts Gen. Oblig.:
(Massachusetts State College Bldg. Auth. Proj.)
7.50% 5/1/05 A1 3,000,000 3,581,250
Rfdg:
Series A:
6.25% 7/1/02 A1 18,565,000 20,119,819
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Gen. Oblig.: - continued
Rfdg: - continued
Series A: - continued
6.25% 7/1/03 A1 $ 18,500,000 $ 20,257,500
6.25% 7/1/04 A1 9,300,000 10,253,250
6% 7/1/05 (AMBAC Insured) Aaa 4,000,000 4,385,000
5.25% 2/1/08 A1 5,000,000 5,150,000
5% 3/1/08 (AMBAC Insured) Aaa 15,000,000 15,337,500
Series B:
5.40% 11/1/06 A1 3,750,000 3,970,313
6.50% 8/1/08 A1 9,500,000 10,996,250
(Consolidated Loan):
Series A:
7.50% 6/1/04 A1 4,830,000 5,614,875
5.40% 11/1/06 A1 1,000,000 1,058,750
Series B:
0% 6/1/99 A1 2,000,000 1,855,000
0% 7/1/02 A1 12,250,000 9,876,563
5.75% 6/1/16
(Pre-Refunded to 6/1/06 @ 101) (d) A1 16,820,000 18,438,925
Series C:
7.25% 12/1/00 (FGIC Insured)
(Pre-Refunded to 12/1/98 @ 102) (d) Aaa 2,000,000 2,115,000
0% 12/1/05 A1 6,500,000 4,428,125
Series D:
6.875% 7/1/10
(Pre-Refunded to 7/1/01 @ 102) (d) Aaa 1,000,000 1,116,250
6% 7/1/12
(Pre-Refunded to 7/1/01 @ 100) (d) Aaa 3,240,000 3,454,650
6% 7/1/12 A1 1,460,000 1,514,750
Series E:
5.75% 7/1/07 (AMBAC Insured) (c) Aaa 3,365,000 3,575,313
5.85% 7/1/08 (AMBAC Insured) (c) Aaa 5,000,000 5,312,500
Massachusetts Health & Edl. Facs. Auth. Rev.:
Rfdg.:
(Baystate Medical Center) Series D
5% 7/1/12 (FGIC Insured) Aaa 6,250,000 6,250,000
(Boston College) Series K:
5.375% 6/1/14 A1 10,445,000 10,810,575
5.25% 6/1/10 A1 3,025,000 3,123,313
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Edl. Facs. Auth. Rev.: - continued
Rfdg.: - continued
(Emerson Hospital) Series D, 5.70%
8/15/12 (FSA Insured) Aaa $ 9,475,000 $ 9,901,375
(Harvard University) Series P:
6.5% 11/1/05 Aaa 1,000,000 1,148,750
5.60% 11/1/14 Aaa 1,000,000 1,050,000
5.625% 11/1/28 Aaa 1,500,000 1,560,000
(Massachusetts Gen. Hosp.)
Series F, 6.25% 7/1/12 (AMBAC Insured) Aaa 3,250,000 3,676,563
(Morton Hosp. & Medical Ctr.) Series B,
5.25% 7/1/08 (Connie Lee Insured) Aaa 2,800,000 2,887,500
(Newton-Wellesley Hosp.) Series G:
6% 7/1/12 (MBIA Insured) Aaa 4,070,000 4,456,650
6.125% 7/1/15 (MBIA Insured) Aaa 4,500,000 4,916,250
(Wheaton College) Series C:
5.125% 7/1/09 A 1,130,000 1,142,713
5.25% 7/1/14 A 2,655,000 2,688,188
5.25% 7/1/19 A 2,000,000 2,000,000
(Anna Jaques Hosp.) Series B:
5.90% 10/1/99 Baa1 930,000 948,600
6% 10/1/00 Baa1 985,000 1,013,319
6.875% 10/1/12 Baa1 3,250,000 3,461,250
(Baystate Medical Ctr.):
Series D, 5.50% 7/1/16 (FGIC Insured) Aaa 6,400,000 6,464,000
Series E:
6% 7/1/04 (FSA Insured) Aaa 1,290,000 1,398,038
6% 7/1/05 (FSA Insured) Aaa 1,385,000 1,509,650
6% 7/1/06 (FSA Insured) Aaa 1,425,000 1,562,156
(Blood Research Institute) Series A,
6.50% 2/1/22 - 15,310,000 16,496,525
(Cape Cod Health Sys.) Series A,
5.25% 11/15/13 (Connie Lee Insured) Aaa 3,500,000 3,526,250
(Dana Farber Cancer Proj.) Series G-1:
6.25% 12/1/14 A1 3,000,000 3,288,750
5.50% 12/1/27 A1 22,625,000 22,709,844
(Emerson Hosp.) Series C, 8% 7/1/18
(Pre-Refunded to 7/1/00 @ 102) (d) Baa1 21,755,000 24,474,375
(Fairview Extended Care) Series B,
4.55% 7/14/02 (MBIA Insured)
LOC BankBoston, N.A Aaa 6,700,000 6,700,000
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Edl. Facs. Auth. Rev.: - continued
(Falmouth Hosp.) Series C, 5.50% 7/1/08
(MBIA Insured) Aaa $ 1,000,000 $ 1,052,500
(Faulkner Hosp.) Series C:
6% 7/1/13 Baa1 9,745,000 10,012,988
6% 7/1/23 Baa1 6,010,000 6,100,150
(Hebrew Rehabilitation Ctr. for Aged)
Series B, 7.375% 7/1/17 A 14,000,000 14,517,440
(Lahey Hitchcock Clinic Medical Ctr.) Series B,
5.25% 7/1/10 (MBIA Insured) Aaa 14,120,000 14,508,300
(Lowell Gen. Hosp.) Series A:
8.25% 6/1/00 (Escrowed to Maturity) (d) A3 1,915,000 2,049,050
8.40% 6/1/11
(Pre-Refunded to 6/1/01 @ 102) (d) A3 2,565,000 2,991,431
(Medical, Academic, & Scientific Cmnty.
Organizations) Series A, 6.625% 1/1/15 A- 4,150,000 4,518,313
(Medical Ctr. of Central Massachusetts) Series B,
9.03% 6/23/22 (AMBAC Insured) INFL (f) Aaa 10,000,000 12,337,500
(Mount Auburn Hosp.) Series B-1:
6.25% 8/15/14 (MBIA Insured) Aaa 1,250,000 1,371,875
6.30% 8/15/24 (MBIA Insured) Aaa 5,000,000 5,425,000
(New England Medical Ctr) Series G,
5.375% 7/1/24 (MBIA Insured) Aaa 1,200,000 1,207,500
(Notre Dame Health Care Ctr.) Series A:
7.25% 10/1/01 - 595,000 633,675
7.875% 10/1/22 - 5,000,000 5,356,250
(Simmons College) Series B,
7.50% 10/1/20 Baa1 6,190,000 6,754,838
(Tufts Univ.) 6.69% 8/15/18
(FGIC Insured) INFL (f) Aaa 7,900,000 8,107,375
(Williams College) Series F:
5.75% 7/1/19 Aa1 3,000,000 3,127,500
5.50% 7/1/26 Aa1 5,165,000 5,261,844
Massachusetts Hsg. Fin. Agcy. Hsg. Rev.:
(Single Family Hsg.):
Rfdg. Series A, 6% 12/1/13 (MBIA Insured) Aaa 5,680,000 5,921,400
Series 3, 7.30% 6/1/14 Aa 6,000,000 6,132,240
Series 8, 7.70% 6/1/17 Aa 500,000 522,500
Series 10, 7.70% 12/1/17 Aa 660,000 692,175
Series 29, 6.75% 6/1/26 Aa 2,700,000 2,902,500
Series 40, 6.60% 12/1/24 (c) Aa 19,550,000 20,771,875
Series 40, 6.65% 12/1/27 (c) Aa 7,000,000 7,463,750
Series 53, 5.20% 12/1/21 (MBIA Insured) (c) Aaa 1,770,000 1,803,188
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Rev.:
Rfdg.:
(Boston Edison Co. Proj.) Series A,
5.75% 2/1/14 Baa2 $ 8,000,000 $ 8,210,000
(Chelsea Jewish Nursing Home) Series A,
11.15% 2/15/25 (FHA Guaranteed) A- 3,520,000 3,877,350
(Framingham Union Hosp.)
Series A, 8.25% 7/1/00
(Pre-Refunded to 7/1/98 @ 102) (d) Aaa 1,905,000 2,019,110
Lesley College Proj.) Series A, 6.30%
7/1/15 (Connie Lee Insured) Aaa 2,525,000 2,736,469
(Milton Academy) Series B, 5.25%
9/1/19 (MBIA Insured) Aaa 2,500,000 2,509,375
(Museum of Fine Arts Boston):
5% 1/1/01 (MBIA Insured) Aaa 2,800,000 2,873,500
5.125% 1/1/04 (MBIA Insured) Aaa 1,150,000 1,194,563
5.375% 1/1/05 (MBIA Insured) Aaa 1,750,000 1,850,625
(Springfield College):
5.25% 9/15/03 Baa1 755,000 767,269
5.25% 9/15/04 Baa1 885,000 896,063
5.35% 9/15/05 Baa1 930,000 943,950
5.625% 9/15/10 Baa1 1,000,000 998,750
(Worcester Polytechnic Institute):
5.75% 9/1/05 (MBIA Insured) Aaa 1,340,000 1,460,600
5.75% 9/1/06 (MBIA Insured) Aaa 1,415,000 1,549,425
5.75% 9/1/07 (MBIA Insured) Aaa 1,500,000 1,648,125
5.75% 9/1/08 (MBIA Insured) Aaa 1,585,000 1,739,538
(Atlanticare Med. Ctr.):
Series A, 10.125% 11/1/14 - 1,900,000 2,042,500
Series B, 10.125% 11/1/14 - 8,200,000 8,815,000
(Babson College) Series A:
5.60% 10/1/06 (MBIA Insured) Aaa 515,000 559,419
5.70% 11/1/07 (MBIA Insured) Aaa 545,000 595,413
(Concord Academy) 6.90% 9/1/21
(FSA Insured) Aaa 1,370,000 1,507,000
(Leominster Hosp.) Series A, 8.375% 8/1/99
(Escrowed to Maturity) (d) - 2,500,000 2,612,500
(Massachusetts Biomedical/Mass. Gen. Hosp.):
Series A-1, 0% 8/1/02 A1 3,650,000 2,910,875
Series A-2:
0% 8/1/03 A1 1,000,000 760,000
0% 8/1/05 A1 24,600,000 16,851,000
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Rev.: - continued
(Massachusetts Biomedical/Mass. Gen. Hosp.): - continued
Series A-2: - continued
0% 8/1/07 A $ 25,000,000 $ 15,281,250
0% 8/1/08 A 15,000,000 8,643,750
(Whitehead Institute Biomedical Research)
5.125% 7/1/26 Aa2 14,600,000 14,271,500
Massachusetts Muni. Wholesale Elec. Co.
Pwr. Supply Sys. Rev.:
Rfdg. Series A:
5.10% 7/1/08 (AMBAC Insured) Aaa 1,000,000 1,031,250
6.75% 7/1/08 Baa2 3,000,000 3,247,500
6% 7/1/18 (MBIA Insured) Aaa 10,000,000 10,325,000
Rfdg. Series B:
6.50% 7/1/02 (MBIA Insured) Aaa 2,000,000 2,190,000
6.625% 7/1/04 Baa2 4,675,000 5,113,281
6.75% 7/1/08 Baa2 2,000,000 2,165,000
Series B, 6.75% 7/1/17 Baa2 9,050,000 9,751,375
Series C, 6.625% 7/1/18 (MBIA Insured) Aaa 10,000,000 10,950,000
Series D, 6% 7/1/06 Baa2 1,000,000 1,060,000
Series E, 6% 7/1/06 Baa2 1,640,000 1,738,400
Massachusetts Port. Auth. Rev.:
Rfdg.:
7.125% 7/1/12 Aa3 2,490,000 2,537,609
Series A:
5.50% 7/1/09 Aa3 3,160,000 3,258,750
5% 7/1/13 Aa3 8,835,000 8,713,519
6% 7/1/03 Aaa 1,000,000 1,085,000
6% 7/1/04 Aaa 1,390,000 1,516,726
5.625% 7/1/12 (Escrowed to Maturity) (d) Aaa 1,900,000 1,983,125
Massachusetts Spl. Oblig. Rev.:
(Gas Tax) Series A, 6% 6/1/13 A1 17,695,000 18,402,800
Series A:
7% 6/1/02 A1 3,050,000 3,389,313
5.20% 6/1/07 (AMBAC Insured) Aaa 6,950,000 7,306,188
5.80% 6/1/14 A1 4,185,000 4,352,400
Massachusetts Tpk. Auth. Tpk. Rev. Rfdg. Series A:
5% 1/1/13 A1 3,000,000 2,940,000
5.125% 1/1/23 (FGIC Insured) Aaa 11,700,000 11,480,625
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Wtr. Poll. Abatement Trust Rev.:
(Poll. Pooled Loan Prog.):
Series 1:
5.30% 2/1/05 Aa1 $ 1,000,000 $ 1,051,250
5.40% 2/1/06 Aa1 2,175,000 2,291,906
5.40% 8/1/06 Aa1 2,230,000 2,349,863
5.45% 2/1/07 Aa1 2,000,000 2,100,000
Series 3:
5.40% 2/1/06 Aaa 3,000,000 3,296,250
5.45% 2/1/07 Aaa 4,795,000 5,298,475
5.40% 2/1/10 Aaa 1,700,000 1,780,750
5.50% 2/1/13 Aaa 6,715,000 6,991,994
Series A:
6% 8/1/02 Aa 3,255,000 3,511,331
6% 8/1/03 Aa 3,450,000 3,738,938
6% 8/1/04 Aa 3,670,000 4,027,825
6% 8/1/05 Aa 1,500,000 1,653,750
Massachusetts Wtr. Resources Auth.:
Rfdg. Series B:
6.25% 11/1/10 A 3,605,000 3,879,881
5% 3/1/22 A 13,000,000 12,447,500
Rfdg. Series C, 6% 12/1/11 A 2,000,000 2,205,000
Series A:
0% 4/1/06 (MBIA Insured) Aaa 10,000,000 6,725,000
6.50% 7/15/07 A 6,000,000 6,870,000
6.50% 7/15/09 A 4,750,000 5,486,250
5.80% 8/1/11 (MBIA Insured) Aaa 2,740,000 2,921,525
7.625% 4/1/14
(Pre-Refunded to 4/1/00 @ 102) (d) Aaa 1,000,000 1,108,750
6.5% 7/15/19 A 16,960,000 19,885,600
6.50% 7/15/21
(Pre-Refunded to 7/15/02 @ 102) (d) Aaa 1,600,000 1,792,000
Series A:
5.875% 11/1/04 A 1,975,000 2,133,000
6% 11/1/08 A 4,500,000 4,820,625
5% 7/15/22 A 2,000,000 2,010,000
4.75% 12/1/23 A 13,000,000 11,895,000
Mendon Upton Reg. School Dist.:
5% 6/1/08 (FGIC Insured) Aaa 1,215,000 1,251,450
5.125% 6/1/09 (FGIC Insured) Aaa 1,285,000 1,328,369
5.125% 6/1/10 (FGIC Insured) Aaa 1,355,000 1,388,875
5.25% 6/1/11 (FGIC Insured) Aaa 1,435,000 1,479,844
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Monson Gen. Oblig. Rfdg. 5.50% 10/15/10
(MBIA Insured) Aaa $ 1,080,000 $ 1,144,800
Nantucket Island Bank Rfdg. Series E,
7.25% 7/1/19 A 6,175,000 6,838,813
Nantucket Island Gen. Oblig.:
5.50% 7/15/08 (MBIA Insured) Aaa 1,375,000 1,467,813
5.50% 7/15/09 (MBIA Insured) Aaa 1,465,000 1,560,225
New England Edl. Loan Marketing Corp.
Rfdg. (Massachusetts Student Loan):
Series A, 5.80% 3/1/02 Aaa 32,000,000 33,760,000
Series A, 5.70% 7/1/05 (c)(e) A1 4,750,000 4,957,813
North Attleborough Gen. Oblig. Ltd. Tax Rfdg.
5.25% 11/1/13 (AMBAC Insured) Aaa 1,000,000 1,015,000
Pentucket Reg'l. School Dist.:
5.10% 2/15/12 (MBIA Insured) Aaa 220,000 221,100
5.10% 2/15/13 (MBIA Insured) Aaa 530,000 531,325
5.10% 2/15/13 (MBIA Insured) Aaa 575,000 576,438
5.10% 2/15/14 (MBIA Insured) Aaa 525,000 523,688
Plymouth County Ctfs. of Prtn. Series A,
7% 4/1/22 - 10,995,000 12,204,450
Quincy Rev. Rfdg. (Quincy Hosp.):
5.30% 1/15/11 (FSA Insured) Aaa 11,400,000 11,414,250
5.25% 1/15/16 (FSA Insured) Aaa 2,000,000 2,007,500
South Essex Swr. Dist. Gen. Oblig.:
Series A:
6% 6/15/03 (MBIA Insured) Aaa 2,390,000 2,605,100
6% 6/15/04 (MBIA Insured) Aaa 2,375,000 2,606,563
6% 6/15/05 (MBIA Insured) Aaa 1,175,000 1,295,438
6% 6/15/06 (MBIA Insured) Aaa 2,305,000 2,547,025
8.75% 12/1/01
(Pre-Refunded to 12/1/00 @ 103) (d) Baa1 425,000 496,719
8.75% 12/1/02
(Pre-Refunded to 12/1/00 @ 103) (d) Baa1 425,000 496,719
8.75% 12/1/03
(Pre-Refunded to 12/1/00 @ 103) (d) Baa1 400,000 467,500
7% 6/1/04 (MBIA Insured)
(Pre-Refunded to 6/1/04 @ 102) (d) Aaa 1,000,000 1,172,500
8.75% 12/1/04
(Pre-Refunded to 12/1/00 @ 103) (d) Baa1 400,000 467,500
8.75% 12/1/05
(Pre-Refunded to 12/1/00 @ 103) (d) Baa1 400,000 467,500
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Southern Berkshire Reg'l. School Dist.
7% 4/15/11 (MBIA Insured)
(Pre-Refunded to 4/15/03 @100) (d)(e) Aaa $ 4,000,000 $ 4,555,000
Taunton Elec. Gen. Oblig.:
8% 2/1/00 A3 1,000,000 1,085,000
8% 2/1/05 A3 1,000,000 1,207,500
Taunton Ind. Dev. Fing. Auth Dev. Rev. Rfdg.
(Pepsi Cola Metro Bottle Co. Proj.)
5.65% 8/1/12 A1 2,400,000 2,496,000
Tewksbury Gen. Oblig.:
7.20% 6/1/05 A2 350,000 397,688
7.20% 6/1/06 A2 150,000 172,125
Tewksbury Gen. Oblig. Various Purp. Unltd. Tax:
9.60% 12/15/98 A2 595,000 635,906
9.60% 12/15/99 A2 595,000 661,938
9.60% 12/15/00 A2 210,000 242,288
9.60% 12/15/01 A2 210,000 249,900
9.60% 12/15/02 A2 210,000 256,725
Westfield Muni. Purp. Loan:
5% 9/1/10 (FSA Insured) Aaa 745,000 752,450
5% 9/1/11 (FSA Insured) Aaa 640,000 642,400
5% 9/1/12 (FSA Insured) Aaa 745,000 745,931
5% 9/1/13 (FSA Insured) Aaa 750,000 748,125
Winchedon Gen. Oblig. 6.05% 3/15/12
(AMBAC Insured) Aaa 1,275,000 1,369,031
Woods Hole, Martha's Vineyard & Nantucket
(Massachusetts Steamship Auth.) Rfdg.
Series A, 5.125% 3/1/11 A1 1,100,000 1,105,500
Worcester Gen. Oblig. Rfdg. Series G, 5.50%
7/1/03 (MBIA Insured) Aaa 3,430,000 3,631,489
1,095,557,165
PUERTO RICO - 2.7 %
Puerto Rico Commonwealth Gen. Oblig. 3%
7/1/06 (MBIA Insured) Aaa 10,000,000 8,962,500
Puerto Rico Commonwealth Hwy. & Trans. Auth.
Hwy. Rev.:
Series S, 6.50% 7/1/02
(Pre-Refunded to 7/1/02 @ 101.50) (d) Baa1 2,500,000 2,800,000
Series T, 6.50% 7/1/02
(Pre-Refunded to 7/1/02 @ 101.50) (d) Baa1 1,540,000 1,724,800
Puerto Rico Elec. Pwr. Auth. Pwr. Rev. Rfdg.:
Series W, 6.50% 7/1/05 (MBIA Insured) Aaa 9,410,000 10,774,450
Series Y, 6.50% 7/1/06 (MBIA Insured) Aaa 4,000,000 4,625,000
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
PUERTO RICO - CONTINUED
Puerto Rico Indl. Medical & Environmental Poll.
Ctl. Facs. Fing. Auth. Rev. (Motorola, Inc. Proj.)
Series A, 6.75% 1/1/14 Aa3 $ 1,500,000 $ 1,659,375
30,546,125
TOTAL MUNICIPAL BONDS
(Cost $1,051,811,176) 1,126,103,290
MUNICIPAL NOTES - 2.2% (B)
MASSACHUSETTS - 2.2%
Boston Wtr. & Swr. Commission Rev.
Series 1994-A, 3.90%,
LOC State Street Bank & Trust Co, VRDN VMIG 1 2,600,000 2,600,000
Massachusetts Health & Edl. Facs. Auth. Rev.:
(Amherst College) Series F, 4.20%, VRDN VMIG 1 1,500,000 1,500,000
(Boston Univ.) Series H, 3.85% 8/19/97,
LOC Landesbank Hessen-Thuringen, VRDN P-1 1,000,000 1,000,000
(Harvard University) Series P, 3.75%, VRDN 1,000,000 1,000,000
(Cap. Asset Prog.):
Series B, 3.50%, (MBIA Insured)
(BPA Credit Suisse) VRDN VMIG 1 1,800,000 1,800,000
Series 1985 D, 3.65%, (MBIA Insured)
(BPA Credit Suisse) VRDN VMIG 1 6,900,000 6,900,000
Series E, 3.75%, LOC Sanwa Bank,
LOC First National Bank Chicago, VRDN VMIG 1 3,500,000 3,500,000
Massachusetts Port Auth. Rev. Rfdg. Series B,
3.65% (LOC Landesbank Hessen-Thuringen)
VRDN VMIG 1 2,300,000 2,300,000
Massachusetts Wtr. Resources Auth. Multi-Modal
Subordinated Gen. Rev. Series 1997-B
(AMBAC Insured) (Liquidity Facility Bank of
Nova Scotia) VRDN VMIG 1 4,600,000 4,600,000
TOTAL MUNICIPAL NOTES
(Cost $25,200,000) 25,200,000
TOTAL INVESTMENTS - 100%
(Cost $1,077,011,176) $ 1,151,303,290
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
SOLD
125 Municipal Bond Contracts Sept. 1997 $ 15,269,531 $ (501,134)
THE FACE VALUE OF FUTURES SOLD AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 1.3%.
SECURITY TYPE ABBREVIATIONS
CP - Commercial Paper
INFL - Inverse Floating Rate Security
VRDN - Variable Rate Demand Notes
LEGEND
5. Standard & Poor's credit ratings are used in the absence of a rating by
Moody's Investors Service, Inc.
6. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
7. Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
8. Security collateralized by an amount sufficient to pay interest and
principal.
9. 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 $517,466.
10. 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.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows :
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 77.6% AAA, AA, A 80.3%
Baa 8.7% BBB 4.9%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
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 3.1%. FMR has
determined that unrated debt securities that are lower quality account for
0.9% of the total value of investment in securities.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
General Obligation 27.9%
Health Care 21.1
Water and Sewer 13.0
Education 9.9
Electric Revenue 6.2
Housing 5.6
Others (individually less than 5%) 16.3
TOTAL 100.0%
INCOME TAX INFORMATION
At July 31, 1997, the aggregate cost of investment securities for income
tax purposes was $1,077,044,815. Net unrealized appreciation aggregated
$74,258,475, of which $74,816,140 related to appreciated investment
securities and $557,665 related to depreciated investment securities.
At January 31, 1997, the fund was required to defer approximately
$7,166,000 of losses on futures contracts.
At January 31, 1997, the fund had a capital loss carryforward of
approximately $5,993,000 all of which will expire on January 31, 2004.
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
JULY 31, 1997 (UNAUDITED)
ASSETS
Investment in securities, at value (cost $1,077,011,176) $ 1,151,303,290
- - See accompanying schedule
Cash 1,210,882
Receivable for investments sold 2,789,244
Interest receivable 13,467,299
TOTAL ASSETS 1,168,770,715
LIABILITIES
Payable for investments purchased $ 9,327,827
Distributions payable 1,153,100
Accrued management fee 368,405
Payable for daily variation on futures contracts 11,719
Other payables and accrued expenses 169,931
TOTAL LIABILITIES 11,030,982
NET ASSETS $ 1,157,739,733
Net Assets consist of:
Paid in capital $ 1,096,436,636
Accumulated undistributed net realized gain (loss) on (12,487,883)
investments
Net unrealized appreciation (depreciation) on investments 73,790,980
NET ASSETS, for 98,123,484 shares outstanding $ 1,157,739,733
NET ASSET VALUE, offering price and redemption price $11.80
per share ($1,157,739,733 (divided by) 98,123,484 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED JULY 31, 1997 (UNAUDITED)
INTEREST INCOME $ 32,234,023
EXPENSES
Management fee $ 2,197,480
Transfer agent, accounting and custodian fees 790,049
and expenses
Non-interested trustees' compensation 2,407
Registration fees 13,323
Audit 19,108
Legal 3,501
Miscellaneous 359
Total expenses before reductions 3,026,227
Expense reductions (11,498) 3,014,729
NET INTEREST INCOME 29,219,294
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 2,530,058
Futures contracts (1,838,684) 691,374
Change in net unrealized appreciation (depreciation) on:
Investment securities 35,744,934
Futures contracts (473,282) 35,271,652
NET GAIN (LOSS) 35,963,026
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 65,182,320
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR ENDED
ENDED JULY 31, JANUARY 31,
1997 1997
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 29,219,294 $ 59,360,679
Net interest income
Net realized gain (loss) 691,374 2,084,824
Change in net unrealized appreciation (depreciation) 35,271,652 (29,165,207)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 65,182,320 32,280,296
FROM OPERATIONS
Distributions to shareholders (29,219,294) (59,360,679)
From net interest income
From net realized gain - (397,849)
TOTAL DISTRIBUTIONS (29,219,294) (59,758,528)
Share transactions 109,640,137 217,181,484
Net proceeds from sales of shares
Reinvestment of distributions 22,289,005 45,372,188
Cost of shares redeemed (138,003,169) (277,432,129)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING (6,074,027) (14,878,457)
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 29,888,999 (42,356,689)
NET ASSETS
Beginning of period 1,127,850,734 1,170,207,423
End of period $ 1,157,739,733 $ 1,127,850,734
OTHER INFORMATION
Shares
Sold 9,555,172 19,127,456
Issued in reinvestment of distributions 1,942,510 3,997,722
Redeemed (12,056,675) (24,478,328)
Net increase (decrease) (558,993) (1,353,150)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS SIX MONTHS YEARS ENDED JANUARY 31, SIX MONTHS YEAR ENDED
ENDED ENDED JULY 31,
JULY 31, 1997 JANUARY 31,
(UNAUDITED) 1997 1996 1995 1994 C 1993 1992
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value,
beginning of period $ 11.430 $ 11.700 $ 10.800 $ 12.210 $ 11.750 $ 11.860 $ 11.320
Income from Investment Operations .298 .605 .652 .700 .714 .364 .735
Net interest income
Net realized and unrealized
gain (loss) .370 (.266) .902 (1.180) .720 (.040) .620
Total from investment operations .668 .339 1.554 (.480) 1.434 .324 1.355
Less Distributions
From net interest income (.298) (.605) (.654) E (.700) (.714) (.364) (.735)
From net realized gain - (.004) - (.230) (.230) (.070) (.080)
In excess of net realized gain - - - - (.030) - -
Total distributions (.298) (.609) (.654) (.930) (.974) (.434) (.815)
Net asset value, end of period $ 11.800 $ 11.430 $ 11.700 $ 10.800 $ 12.210 $ 11.750 $ 11.860
TOTAL RETURN B 5.95% 3.06% 14.76% (3.79)% 12.57% 2.83% 12.48%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
(000 omitted) $ 1,157,740 $ 1,127,851 $ 1,170,207 $ 1,036,181 $ 1,387,410 $ 1,262,596 $ 1,235,407
Ratio of expenses to average
net assets .55% A .56% .55% .54% .54% .55% A .57%
Ratio of expenses to average
net assets after .55% A .56% .54% .54% .54% .55% A .57%
expense reductions D
Ratio of net interest income
to average net 5.30% A 5.29% 5.80% 6.29% 5.93% 6.19% A 6.43%
assets
Portfolio turnover rate 22% A 44% 33% 22% 40% 42% A 18%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS 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.
C EFFECTIVE FEBRUARY 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT
COMPANIES." AS A RESULT, NET INTEREST INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
D FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
E THE AMOUNTS SHOWN REFLECT CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO
TAX DIFFERENCES (SEE NOTE 1 OF NOTES TO FINANCIAL STATEMENTS).
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
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 the value of an
investment, assuming reinvestment of the fund's dividend 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 JULY 31, 1997 PAST 6 PAST 1 PAST 5 PAST 10
MONTHS YEAR YEARS YEARS
Fidelity 1.52% 3.03% 13.25% 41.74%
Massachusetts Municipal
Money Market
Massachusetts Tax-Free 1.50% 3.00% 13.72% 43.02%
Money Market Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be $1,050. To
measure how the fund's performance stacked up against its peers, you can
compare it to the Massachusetts tax-free money market funds average, which
reflects the performance of 11 Massachusetts tax-free money market funds
with similar objectives tracked by IBC Financial Data, Inc. over the past
six months.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JULY 31, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity 3.03% 2.52% 3.55%
Massachusetts Municipal
Money Market
Massachusetts Tax-Free 3.00% 2.61% 3.64%
Money Market Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year.
YIELDS
8/4/97 4/28/97 2/3/97 10/28/96 7/29/96
Massachusetts Municipal 3.09% 3.45% 2.90% 3.02% 2.96%
Money Market
Massachusetts 3.04% 3.45% 2.89% 2.93% 2.92%
Tax-Free Money Market
Funds Average
Massachusetts Municipal 5.48% 6.13% 5.15% 5.36% 5.26%
Money Market Tax-equivalen
t
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 Massachusetts tax-free money market funds average as
tracked by IBC Financial Data, Inc., or you can look at the fund's
tax-equivalent yield, which is based on a combined effective 1997 federal
and state income tax rate of 43.68%, but does not reflect payment of 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 market fund will
maintain a $1 share price.
(checkmark)
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: Tanya Roy became Portfolio Manager of Fidelity
Massachusetts Municipal Money Market Fund on June 1, 1997.
Q. TANYA, WHAT WAS THE INVESTING ENVIRONMENT LIKE OVER THE PAST SIX MONTHS?
A. While the Federal Reserve Board in mid-1996 had indicated its bias
toward raising short-term interest rates to slow economic growth and head
off inflation, it had not acted by early 1997 and the market became
complacent with the steady Fed policy. That sentiment changed in late
February, however, after Fed Chairman Alan Greenspan's semiannual
Humphrey-Hawkins testimony before Congress. Greenspan explained his
concerns that low unemployment might exert upward pressure on the economy's
core inflation. More importantly, he mentioned the possibility that the Fed
might raise the rate banks charge each other for overnight loans - known as
the fed funds target rate - from the 5.25% level it had maintained since
January 1996. The reason behind such a move would be to raise rates to curb
inflation before it passed through to the consumer. Shortly after
Greenspan's remarks, data for February showed an additional 293,000
non-farm jobs had been added to the economy, lowering unemployment to 5.3%.
Interest rates rose as the Fed's March 25 Open Market Committee meeting
approached and fears intensified that there would be a shift in Fed policy.
At that meeting, the Fed raised the fed funds target rate by 0.25% to 5.50%
as expected.
Q. HOW HAS THE ECONOMY PERFORMED SINCE THE FED'S MARCH MEETING?
A. First quarter 1997 data pointed to continued economic strength, with
gross domestic product growing at a stronger-than-expected annual rate of
nearly 5%. In addition, unemployment fell in April to 4.9%, the lowest
level since 1973. Since then, economic data showed signs of weakening
somewhat during the second quarter. Perhaps more importantly, inflation
continued to remain in check. In fact, in the first half of the year there
were six consecutive monthly drops in the producer price index, and the
first half of the year's consumer price index was the lowest in 10 years.
Because of this backdrop, the Fed chose not to change the fed funds target
rate at its latest meeting in early July.
Q. WHAT WAS THE FUND'S STRATEGY DURING THE PERIOD?
A. The fund's average maturity was 46 days at the end of the period. Given
the strong first quarter economic data that was released throughout the
spring, the fund's average maturity declined in anticipation of higher
interest rates. Attractive opportunities appeared in very-short-term
securities, including variable-rate demand notes (VRDNs) and commercial
paper. VRDNs are variable-rate securities that can be redeemed on short
notice, typically in one or seven days. Commercial paper is a promissory
note sold by tax-exempt issuers such as electric utilities to finance
capital needs, usually with a maturity of one to three months. For several
weeks, the average yield on VRDNs was equal to or in some cases even higher
than the yield on one-year notes. This situation enabled the fund to buy
attractive-yielding instruments without taking on the added risk of buying
one-year notes. At the end of the period, yields reverted to a more
historically normal relationship - with longer-term securities offering
higher yields than short-term notes. This came as a result of strong
reinvestment demand in the shorter end of the market that led to a drop in
the yields on VRDNs and commercial paper.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on July 31, 1997, was 3.12%, compared to
2.89% six months ago. The latest yield was the equivalent of a taxable
yield of 5.54% for Massachusetts investors in the 43.68% combined federal
and state tax bracket. The fund's total return during the six-month period
was 1.52%. That beat the total return of 1.50% for the Massachusetts
tax-free money market funds average, according to IBC Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. Should the economy continue to exhibit healthy growth in the third and
fourth quarters of 1997, renewed inflation pressures could result, leading
to higher interest rates. Given this risk, I expect to manage the fund to
be able to take advantage of higher rates over the next six to 12 months. I
also expect to find opportunities in the market by taking advantage of
aberrations caused by technical factors, such as supply and demand
imbalances, seasonal factors and corporate buying trends, among others.
These factors can play out in a day, a week or over several months, and are
an important part of my ongoing strategy.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current tax-free
income for Massachusetts
residents while maintaining
a stable $1.00 share price
FUND NUMBER: 074
TRADING SYMBOL: FDMXX
START DATE: November 11, 1983
SIZE: as of July 31, 1997,
more than $1.0 billion
MANAGER: Tanya Roy, since
June 1997; manager, various
Fidelity and Spartan
municipal money market
funds; joined Fidelity in 1989
(checkmark)
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND % OF FUND % OF FUND
ASSETS ASSETS ASSETS 7/31/96
7/31/97 1/31/97
0 - 30 70 70 73
31 - 90 16 11 8
91 - 180 4 9 2
181 - 397 10 10 17
WEIGHTED AVERAGE MATURITY
7/31/97 1/31/97 7/31/96
Massachusetts Municipal 46 days 51 days 60 days
Money Market
Massachusetts Tax-Free 47 days 50 days 58 days
Money Market Funds
Average *
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JULY 31, 1997 AS OF JANUARY 31, 1997
Row: 1, Col: 1, Value: 1.0
Row: 1, Col: 2, Value: 22.0
Row: 1, Col: 3, Value: 2.0
Row: 1, Col: 4, Value: 16.0
Row: 1, Col: 5, Value: 59.0
Variable rate demand
notes (VRDNs) 47%
Commercial paper 26%
Tender bonds 3%
Municipal
notes 22%
Other 2%
Variable rate demand
notes (VRDNs) 59%
Commercial paper 16%
Tender bonds 2%
Municipal
notes 22%
Other 1%
Row: 1, Col: 1, Value: 2.0
Row: 1, Col: 2, Value: 22.0
Row: 1, Col: 3, Value: 3.0
Row: 1, Col: 4, Value: 26.0
Row: 1, Col: 5, Value: 47.0
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
INVESTMENTS JULY 31, 1997 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 99.7%
Amherst-Pelham Reg'l. School Dist. BAN 4.45% 5/21/98 $ 2,000,000 $
2,005,235
Ashland Gen. Oblig. BAN 4.04% 3/5/98 2,500,000 2,500,556
Barnstable Gen. Oblig. BAN 4% 6/18/98 5,500,000 5,506,965
Bolton Gen. Oblig. BAN 4.50% 4/17/98 3,000,000 3,008,176
Boston Ind. Rev. (New Boston Seafood Ctr.) Series 1997,
3.60%, LOC First Nat'l Bank of Boston, VRDN (b) 875,000 875,000
Boston Wtr. & Swr. Participating VRDN, Series SG-75,
3.75% (Liquidity Facility Societe Generale, France) (c) 8,380,000
8,380,000
Brockton Area Transit Auth. RAN 4.25% 7/17/98 4,000,000 4,011,808
Brookline Gen. Oblig. BAN 4% 6/4/98 5,600,000 5,611,304
Chatham Gen. Oblig. BAN 4.25% 7/22/98 5,000,000 5,014,929
Easton Gen. Oblig. BAN:
4% 8/15/97 2,000,000 2,000,151
4.40% 10/3/97 6,500,000 6,506,266
4.40% 12/19/97 2,855,000 2,860,845
Everett Gen. Oblig. BAN:
4% 12/19/97 1,000,000 1,000,559
4.25% 12/19/97 1,000,000 1,001,488
Fall River BAN 4.50% 8/15/97, LOC State Street Bank &
Trust Co. 3,600,000 3,600,792
Framingham Ind. Rev. Board (Perini Corp. Proj.) Series 1985,
3.75%, LOC Harris Trust & Savings Bank, Chicago, VRDN 400,000 400,000
Georgetown Gen. Oblig. BAN 4% 6/12/98,
LOC State Street Bank & Trust Co. 12,560,000 12,578,752
Gloucester Gen. Oblig. BAN 4.35% 8/8/97 7,500,000 7,500,442
Haverill Gen. Oblig. BAN 4.50% 8/1/97
(BPA Fleet Nat'l Bank) 3,400,000 3,400,000
Hopkinton Gen. Oblig. BAN 4% 12/30/97 3,500,000 3,506,969
Kingston Gen. Oblig. BAN 4% 11/26/97 1,300,000 1,301,612
Leominster Gen. Oblig. BAN 4% 12/17/97 (b) 2,600,000 2,602,536
Mansfield Gen. Oblig. BAN:
4.25% 8/21/97 1,700,000 1,700,424
4.25% 8/21/97 1,700,000 1,700,544
Marlborough Gen. Oblig. BAN 4% 12/18/97 3,337,000 3,342,275
Massachusetts Bay Transit Auth.:
CP, Series C:
3.75% 8/7/97, LOC Westdeutsche Landesbank 2,000,000 2,000,000
3.75% 9/8/97, LOC Westdeutsche Landesbank 2,400,000 2,400,000
3.75% 10/14/97, LOC Westdeutsche Landesbank 2,400,000 2,400,000
RAN:
4.75% 9/5/97 31,100,000 31,121,653
Series 1997 A, 4.25% 2/27/98 18,040,000 18,101,222
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Bay Transit Auth. Participating VRDN,
Series 1995 A, 3.75%
(Liquidity Facility Societe Generale France) (c) $ 7,000,000 $ 7,000,000
Massachusetts Dedicated Income Tax (First Recovery Loan)
Series 1990 B, 3.60%, LOC Nat'l. Westminster,
USA, VRDN 4,600,000 4,600,000
Massachusetts Gen. Oblig.:
Series 1997 A, 4.25% 3/1/98 7,000,000 7,021,660
Series 1997-B, 5% 6/1/98 9,330,000 9,412,726
Participating VRDN (c):
Series 1993 A, 3.73% (Liquidity Facility Citibank, NA) 3,800,000
3,800,000
Series 1996 SG-38, 3.75% (MBIA Insured)
(Liquidity Societe Generale, France) 5,000,000 5,000,000
Series 1996 SG-47, 13.75%
(Liquidity Facility Societe Generale, France) 2,000,000 2,000,000
Series 93 I, 3.78% (Liquidity Facility Citibank, NY) 13,000,000
13,000,000
Series 93-2, 3.79% (Liquidity Facility State Street
Bank & Trust Co., Boston) 19,000,000 19,000,000
Series 214, 3.65% (Liquidity Facility Bankers Trust Co.) 9,300,000
9,300,000
Series 96C2101, 3.78% (Liquidity Facility Citibank, NA) 4,700,000
4,700,000
Series 97C2101, 3.73% (Liquidity Facility Citibank, NA) 5,800,000
5,800,000
Massachusetts Health & Ed. Facs. Auth. Rev. Bonds:
(Harvard Univ.):
3.75% 8/20/97, CP mode 1,000,000 1,000,000
3.75% 9/16/97, CP mode 10,300,000 10,300,000
Massachusetts Health & Ed. Facs. Auth. Participating VRDN,
Series SG-27, 3.75%
(Liquidity Facility Societe Generale, France) (c) 6,500,000 6,500,000
Massachusetts Health & Ed. Facs. Auth. Rev., VRDN:
(Amherst College) Series F, 3.45% 11,000,000 11,000,000
(Boston Univ.) Series H, 3.85% tender 8/19/97,
LOC Landesbank Hessen-Thuringen 12,400,000 12,400,000
(Brandeis Univ.) Series 1996 G, 3.50%,
LOC Fleet Nat'l. Bank 5,675,000 5,675,000
(Cap. Asset):
Series 1985 D, 3.65% (MBIA Insured)
(BPA Credit Suisse) 21,200,000 21,200,000
Series B, 3.50% (MBIA Insured) (BPA Credit Suisse) 6,300,000 6,300,000
Series C, 2.80% (MBIA Insured) (BPA Credit Suisse) 6,400,000 6,400,000
Series E, 3.75%, LOC First Nat'l. Bank of Chicago 10,500,000 10,500,000
(Harvard Univ.) Series I 3.45% 68,980,000 68,980,000
(Mount Ida College) 3.55%, LOC Chase Manhattan Bank 3,600,000 3,600,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Ed. Facs. Auth. Rev., VRDN: - continued
(Partners Healthcare Sys.) (Cap. Asset):
Series P-1, 3.50% (Liquidity Facility Bayerische
Landesbank Girozent) $ 18,000,000 $ 18,000,000
Series P-2, 3.50% (FSA Insured) (Liquidity Facility
Bayerische Landesbank Girozent) 31,800,000 31,800,000
Massachusetts Hsg. Fin. Agcy. Multi-Family Hsg. Proj.
Series 1995 A, 3.50%, (FNMA Guaranteed) 100,000 100,000
Massachusetts Hsg. Fin. Agcy. Multi-Family Hsg. Rev.
(Princeton Crossing Proj.) Series 1996, 3.60%,
LOC General Elec. Capital Corp., VRDN (b) 13,700,000 13,700,000
Massachusetts Hsg. Fin. Agcy. Multi-Family Rev. Rfdg.
(Harbor Point) Series 1995 A, 3.55%
(GNMA Guaranteed) (BPA LOC Republic Bank of
New York) VRDN 57,455,000 57,455,000
Massachusetts Hsg. Fin. Agcy. Participating VRDN (c):
Tax Exempt Series PA-83, 3.85%
(Liquidity Facility Merrill Lynch & Co.) (b) 5,920,000 5,920,000
Series PA-132, 3.85%
(Liquidity Facility Merrill Lynch & Co., Inc.) (b) 1,225,000 1,225,000
Series PT-33, 3.80%
(Liquidity Facility Banque Nat'l. de Paris) (b) 5,180,000 5,180,000
Series PT-42, 3.65%
(Liquidity Facility Commerzbank, Germany) 5,080,000 5,080,000
Series 13-C, 3.70% (AMBAC Insured)
(Liquidity Facility Morgan Guaranty Trust Co.) 5,800,000 5,800,000
Massachusetts Hsg. Fin. Agcy. Single Family Hsg. Rev.
Bonds Series 50, 3.90%, tender 6/1/98 3,400,000 3,400,000
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev., VRDN:
Rfdg.:
(First Healthcare Corp. for Hillhaven Proj.) 3.65%,
LOC Wachovia Bank of Georgia 2,000,000 2,000,000
(First Healthcare Corp. Proj.) Series 1992 A, 3.65%,
LOC Wachovia Bank of Georgia 2,025,000 2,025,000
(First Healthcare Corp.) Series 1993 B, 3.60%,
LOC Wachovia Bank of Georgia 700,000 700,000
(BBB Esq. LLC) Series 1996, 3.80%,
LOC First Nat'l Bank of Boston (b) 1,100,000 1,100,000
(Baker School Specialty Co. Inc.) Series 1996, 3.50%,
LOC Fleet Nat'l. Bank (b) 3,300,000 3,300,000
(Battery Engineering, Inc.) Series 1996, 3.85%,
LOC Bank of Tokyo-Mitsubishi (b) 1,600,000 1,600,000
(Brady Enterprises) Series 1996, 3.50%,
LOC Fleet Nat'l. Bank 2,500,000 2,500,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev., VRDN: - continued
(General Signal Proj.) Series 1984:
3.65%, LOC Wachovia Bank of Georgia $ 1,100,000 $ 1,100,000
3.65%, LOC Wachovia Bank of Georgia 7,500,000 7,500,000
(Hazen Paper Proj.) Series1996, 3.80%,
LOC First Nat'l. Bank of Boston (b) 1,500,000 1,500,000
(Interpolymer Corp.) Series 1992, 3.80%,
LOC First Nat'l Bank of Boston 3,400,000 3,400,000
(KMS Cos.) Series 1996, 3.60%,
LOC State Street Bank & Trust (b) 2,300,000 2,300,000
(Longview Fiber Co.) Series 1987, 3.70%,
LOC Algemene Bank 2,070,000 2,070,000
(Nova Realty) Series 1994, 3.55%,
LOC First Nat'l. Bank of Boston 2,900,000 2,900,000
(Nutramax Products) Series 1996, 3.60%,
LOC First Nat'l Bank of Boston (b) 2,800,000 2,800,000
Massachusetts Ind. Fin. Agcy. Participating VRDN,
Series 1996 SG-56, 3.75%
(Liquidity Facility Societe Generale, France) (c) 11,100,000 11,100,000
Massachusetts Ind. Fin. Poll. Cont. Rev. Rfdg.:
(Holyoke Wtr. Pwr. Co. Proj.) Series 1990, 3.50%,
LOC Swiss Bank, VRDN (b) 3,700,000 3,700,000
(New England Power Co. Proj.) Bonds:
Series 1992-B:
3.75% 8/12/97, CP mode 6,000,000 6,000,000
3.75% 8/21/97, CP mode 10,400,000 10,400,000
3.80% 9/8/97, CP mode 4,200,000 4,200,000
3.80% 9/8/97, CP mode 3,900,000 3,900,000
3.80% 9/17/97, CP mode 1,300,000 1,300,000
3.80% 10/16/97, CP mode 4,600,000 4,600,000
3.85% 10/22/97, CP mode 5,200,000 5,200,000
Series 1993-A:
3.70% 8/14/97, CP mode 3,500,000 3,500,000
3.70% 8/26/97, CP mode 1,700,000 1,700,000
3.85% 9/9/97, CP mode 5,100,000 5,100,000
3.80% 9/11/97, CP mode 6,900,000 6,900,000
Series 1993-B:
3.70% 8/20/97, CP mode 4,300,000 4,300,000
3.70% 8/26/97, CP mode 3,600,000 3,600,000
3.85% 9/9/97, CP mode 7,600,000 7,600,000
3.80% 10/16/97, CP mode 3,300,000 3,300,000
3.85% 10/22/97, CP mode 5,300,000 5,300,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Resource Recovery Rev.
(Ogden-Haverhill Proj.) Series 1986 B, 3.45%,
LOC Union Bank of Switzerland, VRDN (b) $ 17,825,000 $ 17,825,000
Massachusetts Ind. Fin. Agcy. Rev., VRDN:
(346 Univ. LLC) Series 1996, 3.80%,
LOC First Nat'l. Bank of Boston (b) 2,000,000 2,000,000
(Abbott Box Co.) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank (b) 3,800,000 3,800,000
(Barker Steel Company) Series 1995, 3.60%,
LOC State Street Bank & Trust Co., Boston (b) 1,100,000 1,100,000
(Bradford College) Series 1995 A, 3.55%,
LOC First Nat'l. Bank of Boston 1,800,000 1,800,000
(Buckingham Browne Nichols School)
3.50%, LOC State Street Bank & Trust Co. 4,000,000 4,000,000
(Canton/Cedar Reality LLC) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank (b) 2,000,000 2,000,000
(Carand Reality Trust) Series 1997, 3.60%,
LOC State Street Bank & Trust Co. (b) 1,000,000 1,000,000
(Decas Cranberry Proj.) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank, VRDN (b) 4,500,000 4,500,000
(Edgewood Retirement Commty.) Series 1995 C, 3.60%,
LOC Dresdner Bank, A.G. 2,400,000 2,400,000
(Falmouth Assisted Living) Series 1995, 3.60%,
LOC First Nat'l. Bank of Boston 4,100,000 4,100,000
(Governor Dummer Academy) Series 1996, 3.50%,
LOC State Street Bank & Trust Co. 1,800,000 1,800,000
(Groton School Proj.) 3.50%,
LOC State Street Bank & Trust Co. 3,500,000 3,500,000
(Heritage at Darmouth) Series 1996, 3.55%,
LOC First Nat'l Bank of Boston (b) 1,000,000 1,000,000
(Heritage at Hingham) Series 1997, 3.55%,
LOC Fleet Nat'l. Bank (b) 3,890,000 3,890,000
(Lower Mills Associates II L.P.) Series 1995, 3.55%,
LOC First Nat'l. Bank of Boston 1,000,000 1,000,000
(Mary Ann Morse Nursing Home):
Series 1994 B, 3.50%, LOC ABN-AMRO Bank 6,900,000 6,900,000
Series 1994 A, 3.80%, LOC ABN-AMRO Bank 5,900,000 5,900,000
(Parker-Hannifin Corp. Proj.) Series 1997, 3.75%,
LOC Wachovia Bank of Georgia (b) 2,700,000 2,700,000
(Riverdale Mills Corp.) Series 1995, 3.80%,
LOC First Nat'l Bank of Boston (b) 3,800,000 3,800,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Rev., VRDN: - continued
(Southern New England School Of Law) 3.40%,
LOC Fleet Nat'l Bank $ 2,000,000 $ 2,000,000
(Wheelock College Issue) Series A, 3.50%,
LOC Nat'l. Westminster Bank 4,400,000 4,400,000
(United Medical Corp.) Series 1992, 3.55%,
LOC United Jersey (b) 1,300,000 1,300,000
(United Plastics) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank (b) 2,200,000 2,200,000
(Youville Place Inc.) Series 1996, 3.75%
(AMBAC Insured) (BPA Fleet Nat'l. Bank) 5,300,000 5,300,000
Massachusetts Ind. Fin. Agcy. Rev. Rfdg.
(WGBH Ed. Foundation Proj.) Series 1992, 3.50%,
LOC Nat'l. Westminster Bank, VRDN 5,095,000 5,095,000
Massachusetts Muni. Wholesale Elec. Co. Pwr. Supply Rev.
Series 1994 C, 3.50%, LOC Canadian Imperial
Bank of Commerce, VRDN 17,700,000 17,700,000
Massachusetts Port Auth. Rev., VRDN:
Series 1995 A, 3.60%,
LOC Landesbanken Hessen-Thuringen 3,180,000 3,180,000
Series 1995 B, 3.65%,
LOC Landesbanken Hessen-Thuringen (b) 11,100,000 11,100,000
Massachusetts Wtr. Poll. Abatement Trust Rev. Bonds
(South Essex Sewer Dist. Loan Prog.) 5% 8/1/97 4,020,000 4,020,000
Massachusetts Wtr. Resolution Auth. Gen. Rev. Bonds
Series 1995 B, 5% 12/1/97 1,000,000 1,004,387
Massachusetts Wtr. Resource Auth.:
Multi-Modal Subordinated Gen. Rev., VRDN:
Series 1997-A, 3.50% (Liquidity Facility Bank of
Nova Scotia) (AMBAC Insured) 20,000,000 20,000,000
Series 1997-B, 3.50% (Liquidity Facility Bank of
Nova Scotia) (AMBAC insured) 47,500,000 47,500,000
CP:
3.75% 8/14/97, LOC Morgan Guaranty Trust Co., NY 4,500,000 4,500,000
3.75% 8/19/97, LOC Morgan Guaranty Trust Co., NY 7,200,000 7,200,000
3.80% 9/10/97, LOC Morgan Guaranty trust Co., NY 12,400,000 12,400,000
3.70% 9/11/97, LOC Morgan Guaranty Trust Co., NY 4,000,000 4,000,000
3.75% 9/11/97, LOC Morgan Guaranty Trust Co., NY 2,400,000 2,400,000
3.80% 9/12/97, LOC Morgan Guaranty Trust Co., NY 16,690,000 16,690,000
3.80% 9/15/97, LOC Morgan Guaranty Trust Co., NY 5,000,000 5,000,000
3.75% 9/17/97, LOC Morgan Guaranty Trust Co., NY 8,250,000 8,250,000
3.75% 9/18/97, LOC Morgan Guaranty Trust Co., NY 13,500,000 13,500,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Wtr. Resource Auth. Participating VRDN (c):
Series SG-17, 3.75%
(Liquidity Facility Societe Generale, France) $ 4,640,000 $ 4,640,000
Series SG-63, 3.75%
(Liquidity Facility Societe Generale, France) 1,000,000 1,000,000
Medway Gen. Oblig. BAN 4% 9/19/97 4,500,000 4,502,070
Merrimack Valley Reg'l. Transit Auth. RAN 4.25% 6/19/98 3,600,000
3,610,063
Montachusetts Reg'l. Transit Auth. RAN 4.25% 6/26/98 4,000,000 4,011,964
Nantucket Gen. Oblig. BAN 4% 8/15/97 1,750,000 1,750,098
Natick Gen. Oblig. BAN 4.50% 8/8/97 8,990,000 8,991,050
North Andover Gen. Oblig. BAN 4% 1/9/98 2,500,000 2,502,654
Northborough Ind. Rev.
(Tru Realty Corp. Proj. Toys "R" Us, Inc.)
3.725%, LOC Chase Manhattan Bank, VRDN 2,900,000 2,900,000
Peabody Gen. Oblig. BAN 4.15% 8/15/97 3,300,000 3,300,366
Reading Gen. Oblig. BAN 4.25% 8/15/97 3,350,000 3,350,675
Seekonk Gen. Oblig. BAN 4% 11/19/97 4,610,000 4,616,714
Springfield Gen. Oblig. BAN:
4.40% 6/26/97 (BPA Fleet Nat'l. Bank) 2,000,000 2,007,791
4.25% 11/7/97 (BPA Fleet Nat'l. Bank) 9,000,000 9,011,804
4.30% 11/7/97 (BPA Fleet Nat'l. Bank) 4,500,000 4,505,892
4.10% 11/21/97 (BPA Fleet Nat'l. Bank) 4,500,000 4,504,426
Stoughton Gen. Oblig. BAN:
3.70% 8/29/97 1,500,000 1,500,247
4% 8/29/97 2,890,000 2,890,665
4.25% 8/29/97 1,877,000 1,877,429
Taunton Gen. Oblig. BAN 4% 12/3/97 2,900,000 2,903,133
Wakefield Gen. Oblig. BAN 4% 8/20/97 1,600,000 1,600,326
Walpole Gen. Oblig. BAN 4.15% 6/3/98 1,800,000 1,804,358
Watertown Gen. Oblig. BAN 4.50% 8/28/97 5,482,000 5,484,231
West Springfield Gen. Oblig. BAN 3.75% 3/5/98 13,300,000 13,311,334
Westfield Gen. Oblig. BAN 4.10% 3/26/98 2,000,000 2,001,843
Worcester Gen. Oblig. BAN:
4% 8/28/97 7,152,000 7,154,107
4.30% 8/28/97 2,000,000 2,000,436
1,060,072,952
PUERTO RICO - 0.3%
Puerto Rico Elec. Pwr. Auth. Rev. Participating VRDN,
Series 1995-Z, 3.40% (Liquidity Facility Merrill
Lynch & Co., Inc.) (c) 2,680,000 2,680,000
TOTAL INVESTMENTS - 100% $ 1,062,752,952
Total Cost for Income Tax Purposes $ 1,062,731,736
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Notes
CP - Commercial Paper
RAN - Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
1. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
2. Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
3. Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At January 31, 1997, the fund had a capital loss carryforward of
approximately $82,000 of which $17,000, $13,000 and $52,000 will expire on
January 31, 1998, 2003 and 2005, respectively.
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
JULY 31, 1997 (UNAUDITED)
ASSETS
Investment in securities, at value - $ 1,062,752,952
See accompanying schedule
Cash 1,265,110
Interest receivable 8,927,649
TOTAL ASSETS 1,072,945,711
LIABILITIES
Payable for investments purchased $ 10,000,000
Distributions payable 68,612
Accrued management fee 335,111
Other payables and accrued expenses 191,960
TOTAL LIABILITIES 10,595,683
NET ASSETS $ 1,062,350,028
Net Assets consist of:
Paid in capital $ 1,062,446,452
Accumulated net realized gain (loss) on investments (96,424)
NET ASSETS, for 1,062,348,541 shares outstanding $ 1,062,350,028
NET ASSET VALUE, offering price and redemption price per $1.00
share ($1,062,350,028 (divided by) 1,062,348,541 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED JULY 31, 1997 (UNAUDITED)
INTEREST INCOME $ 18,305,283
EXPENSES
Management fee $ 1,983,842
Transfer agent, accounting and custodian fees and 882,232
expenses
Non-interested trustees' compensation 947
Registration fees 23,950
Audit 28,731
Legal 3,087
Total expenses before reductions 2,922,789
Expense reductions (2,161) 2,920,628
NET INTEREST INCOME 15,384,655
REALIZED AND UNREALIZED GAIN (LOSS) (17,590)
Net realized gain (loss) on investment securities
Increase (decrease) in net unrealized gain from (5,055)
accretion of discount
NET GAIN (LOSS) (22,645)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 15,362,010
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR ENDED
ENDED JULY JANUARY 31,
31,1997 1997
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 15,384,655 $ 25,070,453
Net interest income
Net realized gain (loss) (17,590) (51,705)
Increase (decrease) in net unrealized gain from (5,055) 5,055
accretion of discount
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 15,362,010 25,023,803
FROM OPERATIONS
Distributions to shareholders from net interest income (15,384,655) (25,070,453)
Share transactions at net asset value of $1.00 per share 1,645,939,452 2,699,539,513
Proceeds from sales of shares
Reinvestment of distributions from net interest income 14,888,793 24,416,904
Cost of shares redeemed (1,566,145,017) (2,603,710,474)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 94,683,228 120,245,943
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 94,660,583 120,199,293
NET ASSETS
Beginning of period 967,689,445 847,490,152
End of period $ 1,062,350,028 $ 967,689,445
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS SIX MONTHS YEARS ENDED JANUARY 31, SIX MONTHS YEAR ENDED
ENDED ENDED JULY 31,
JULY 31, 1997 JANUARY 31,
(UNAUDITED) 1997 1996 1995 1994 1993 1992
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .015 .029 .032 .023 .017 .010 .029
Net interest income
Less Distributions
From net interest income (.015) (.029) (.032) (.023) .017 (.010) (.029)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 1.52% 2.90% 3.20% 2.29% 1.71% .99% 2.94%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 1,062,350 $ 967,689 $ 847,490 $ 756,929 $ 610,154 $ 584,939 $ 600,945
Ratio of expenses to average net assets .58% A .59% .60% .63% .66% .64% A .65%
Ratio of net interest income to average net 3.05% A 2.86% 3.15% 2.28% 1.69% 1.96% A 2.93%
assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
NOTES TO FINANCIAL STATEMENTS
For the period ended July 31, 1997 (Unaudited)
5. SIGNIFICANT ACCOUNTING POLICIES.
Spartan Massachusetts Municipal Income Fund (the income fund) (formerly
Fidelity Massachusetts Municipal Income Fund) and Fidelity Municipal Money
Market Fund (the money market fund) 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 financial
statements have been prepared in conformity with generally accepted
accounting principles which permit management to make certain estimates and
assumptions at the date of the financial statements. The following
summarizes the significant accounting policies of the funds:
SECURITY VALUATION.
INCOME 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. Securities for which
quotations are not readily available are valued at their fair value as
determined in good faith under consistently applied procedures under the
general supervision of the Board of Trustees. Short-term securities with
remaining maturities of sixty days or less for which quotations are not
readily available are valued at amortized cost or original cost plus
accrued interest, both of which approximate current value.
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 substantially all of its taxable income for
the fiscal year. The schedules of investments include information regarding
income taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned. For the
money market fund, accretion of 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,
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS -
CONTINUED
are primarily due to differing treatments for paydown gains/losses on
certain securities/futures and options transactions, market discount,
capital loss carryforwards, losses deferred due to futures and options and
excise tax regulations.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net investment income and realized
and unrealized gain (loss). Accumulated undistributed net realized gain
(loss) on investments may include temporary book and tax basis differences
that will reverse in a subsequent period. Distributions in excess of net
investment income may include temporary book and tax basis differences that
will reverse in a subsequent period. Any taxable income or gain remaining
at fiscal year end is distributed in the following year.
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.
6. OPERATING POLICIES.
FUTURES CONTRACTS. The fund may use futures contracts to manage its
exposure to the bond market and to fluctuations in interest rates. Buying
futures tends to increase the fund's exposure to the underlying instrument,
while selling futures tends to decrease the fund's exposure to the
underlying instrument or hedge other fund investments. Futures contracts
involve, to varying degrees, risk of loss in excess of the futures
variation margin reflected in the Statement of Assets and Liabilities. The
underlying face amount at value of any open futures contracts at period end
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. Gains (losses) are realized upon the expiration or closing of the
futures contracts. Futures contracts are valued at the settlement price
established each day by the board of trade or exchange on which they are
traded.
7. PURCHASES AND SALES OF INVESTMENTS.
INCOME FUND. Purchases and sales of securities, other than short-term
securities, aggregated $120,460,647 and $142,028,665, respectively.
The market value of futures contracts opened and closed during the period
amounted to $50,379,321 and $69,691,756, respectively.
8. 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
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
MANAGEMENT FEE - CONTINUED
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
.1100% to .3700% for the period. In the event that these rates were lower
than the contractual rates in effect during the period, FMR voluntarily
implemented the above rates, as they resulted in the same or a lower
management fee. For the period, the management fees were equivalent to
annual rates of .40% and .39%, of average net assets for the income 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.
TRANSFER AGENT AND ACCOUNTING FEES. UMB Bank, n.a. (UMB) is the custodian
and transfer and shareholder servicing agent for the funds. UMB has entered
into a sub-contract with Fidelity Service Company, Inc. (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 account fees and asset-based fees that vary according to account
size and type of account. 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 $580,750 and $173,851 for the income fund and $774,175 and
$76,597 for the money market fund, respectively.
For the period, the transfer agent fees were equivalent to an annualized
rate of .11% and .15% of average net assets for the income fund and the
money market fund, respectively.
9. EXPENSE REDUCTIONS.
Each fund has entered into arrangements with its custodian and transfer
agent whereby credits realized as a result of uninvested cash balances were
used to reduce a portion of each fund's expenses. During the period, the
custodian and transfer agent fees were reduced by $11,498 and $2,161 for
the income and money market funds, respectively, under this arrangement.
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
Robert C. Pozen, Senior Vice President
Fred L. Henning, Jr., Vice President
Boyce Greer, Vice President -
MONEY MARKET FUND
Dwight D. Churchill, Vice President -
INCOME FUND
Jonathan D. Short, Vice President -
INCOME FUND
Arthur S. Loring, Secretary
Richard A. Silver, Treasurer
Thomas D. Maher, Assistant
Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
* INDEPENDENT TRUSTEES
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
UMB Bank, n.a.
Kansas City, MO
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
UMB Bank, n.a.
Kansas City, MO
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
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)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE
