(2_FIDELITY_LOGOS)FIDELITY
MAGELLAN(registered trademark)
FUND
ANNUAL REPORT
MARCH 31, 1995
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 6 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 12 A summary of major shifts in the
fund's investments over the past six
months.
INVESTMENTS 13 A complete list of the fund's
investments with their market
values.
FINANCIAL STATEMENTS 36 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 40 Notes to the financial statements.
REPORT OF INDEPENDENT 50 The auditors' opinion.
ACCOUNTANTS
DISTRIBUTIONS 51
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS
OF, OR
GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE
FDIC, THE
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT
RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. NEITHER THE FUND NOR FIDELITY
DISTRIBUTORS
CORPORATION IS A BANK. FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING
CHARGES AND
EXPENSES, CALL 1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY
BEFORE YOU
INVEST OR SEND MONEY.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
Although there have been some positive market indications so far in 1995,
no one can predict what lies ahead for investors. Last year, stocks posted
below-average returns and bonds had one of the worst years in history. This
downturn followed a period in which the investing environment was generally
very positive.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
If you can leave your money invested over the long term, you can avoid the
results of the volatility that generally accompanies the stock market in
the short term, as we witnessed last year. You also can help to manage some
of the risks of investing through diversification. A stock fund is already
diversified because it invests in many issues. You can diversify even
further by placing some of your money in several different types of stock
funds or in other investment categories, such as bonds.
If you have a short investment time horizon, you might want to consider
moving some of your investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
Finally, no matter what your investment horizon or portfolio diversity, it
makes good sense to follow a regular investment plan - investing a certain
amount of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
If you have any questions, please call us at 1-800-544-8888. We stand ready
to provide the information you need to make the investments that are right
for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each
performance figure includes changes in a fund's share price, plus
reinvestment of any dividends (or income) and capital gains (the profits
the fund earns when it sells stocks that have grown in value).
CUMULATIVE TOTAL RETURNS
PERIODS ENDED MARCH 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Magellan 8.21% 95.37% 405.32%
Magellan (incl. 3% sales 4.96% 89.51% 390.16%
charge)
S&P 500(registered trademark) 15.57% 71.70% 285.49%
Average Growth Fund 9.17% 69.22% 236.09%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one, five, or 10 years. For example, if
you 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 Standard & Poor's Composite Index of 500
Stocks - a common proxy for the U.S. stock market. To measure how the
fund's performance stacked up against its peers, you can compare it to the
average growth fund, which reflects the performance of 387 growth funds
with similar objectives tracked by Lipper Analytical Services over the past
12 months. Both benchmarks include reinvested dividends and capital gains,
if any, and exclude the effects of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MARCH 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Magellan 8.21% 14.33% 17.59%
Magellan (incl. 3% sales charge) 4.96% 13.64% 17.23%
S&P 500(registered trademark) 15.57% 11.42% 14.45%
Average Growth Fund 9.17% 10.84% 12.49%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
Magellan (021) Standard & Poor's 50
03/31/85 9700.00 10000.00
04/30/85 9751.48 9991.00
05/31/85 10278.68 10568.48
06/30/85 10586.08 10734.40
07/31/85 10665.67 10718.30
08/31/85 10717.82 10627.20
09/30/85 10215.55 10294.57
10/31/85 10877.01 10770.18
11/30/85 11796.46 11509.01
12/31/85 12408.52 12066.05
01/31/86 12897.06 12133.62
02/28/86 14230.96 13041.21
03/31/86 15188.84 13768.91
04/30/86 15257.45 13613.32
05/31/86 15758.89 14337.55
06/30/86 16134.53 14579.85
07/31/86 15058.29 13764.84
08/31/86 16027.20 14786.19
09/30/86 14664.77 13563.37
10/31/86 15430.95 14345.98
11/30/86 15585.98 14694.59
12/31/86 15354.83 14319.88
01/31/87 17351.05 16248.76
02/28/87 18637.72 16890.59
03/31/87 18874.24 17378.73
04/30/87 18571.49 17224.06
05/31/87 18590.40 17373.91
06/30/87 19360.00 18251.29
07/31/87 20306.11 19176.63
08/31/87 21121.61 19891.92
09/30/87 20602.66 19456.28
10/31/87 15286.07 15265.40
11/30/87 14131.67 14007.53
12/31/87 15508.43 15073.50
01/31/88 16123.36 15708.10
02/29/88 17101.82 16440.10
03/31/88 17055.41 15932.10
04/30/88 17360.94 16108.94
05/31/88 17314.53 16249.09
06/30/88 18497.97 16994.92
07/31/88 18378.07 16930.34
08/31/88 17794.09 16354.71
09/30/88 18540.51 17051.42
10/31/88 18927.25 17525.45
11/30/88 18672.00 17274.84
12/31/88 19038.90 17577.15
01/31/89 20583.45 18863.79
02/28/89 20248.53 18394.09
03/31/89 20851.38 18822.67
04/30/89 21899.46 19799.56
05/31/89 23055.69 20601.45
06/30/89 22855.66 20484.02
07/31/89 24775.96 22333.73
08/31/89 25424.07 22771.47
09/30/89 25864.14 22678.10
10/31/89 25052.01 22151.97
11/30/89 25464.07 22603.87
12/31/89 25623.40 23146.37
01/31/90 23970.83 21593.24
02/28/90 24463.18 21871.80
03/31/90 25088.24 22451.40
04/30/90 24454.61 21890.11
05/31/90 26629.65 24024.40
06/30/90 26745.39 23861.03
07/31/90 26442.68 23784.68
08/31/90 23851.83 21634.54
09/30/90 22338.28 20580.94
10/31/90 22062.28 20492.44
11/30/90 23731.64 21816.26
12/31/90 24468.09 22424.93
01/31/91 26178.55 23402.66
02/28/91 28451.59 25075.95
03/31/91 29417.97 25682.78
04/30/91 29526.86 25744.42
05/31/91 31210.47 26856.58
06/30/91 29376.49 25626.55
07/31/91 31201.12 26820.75
08/31/91 32160.22 27456.40
09/30/91 32038.57 26997.88
10/31/91 32469.00 27359.65
11/30/91 30864.26 26257.06
12/31/91 34506.99 29260.86
01/31/92 34522.08 28716.61
02/29/92 35221.17 29089.93
03/31/92 34265.57 28522.67
04/30/92 34773.55 29361.24
05/31/92 35106.69 29505.11
06/30/92 34488.33 29065.48
07/31/92 35456.20 30254.26
08/31/92 34687.29 29634.05
09/30/92 35085.19 29983.73
10/31/92 35332.53 30088.67
11/30/92 36225.12 31114.70
12/31/92 36927.45 31497.41
01/31/93 37900.31 31761.99
02/28/93 38691.48 32193.95
03/31/93 40109.74 32873.24
04/30/93 40502.40 32077.71
05/31/93 42098.76 32937.39
06/30/93 42685.84 33032.91
07/31/93 43156.73 32900.78
08/31/93 45694.64 34147.72
09/30/93 46189.99 33884.78
10/31/93 46220.57 34586.20
11/30/93 44697.82 34257.63
12/31/93 46032.80 34672.14
01/31/94 47852.03 35851.00
02/28/94 47501.18 34879.44
03/31/94 45298.62 33358.69
04/30/94 45753.42 33785.68
05/31/94 45226.35 34339.77
06/30/94 43264.11 33498.44
07/31/94 44712.11 34597.19
08/31/94 46829.98 36015.68
09/30/94 45612.03 35133.29
10/31/94 47154.76 35923.79
11/30/94 44570.01 34615.45
12/31/94 45199.28 35128.80
01/31/95 44739.17 36039.69
02/28/95 47249.49 37444.15
03/31/95 49015.51 38549.13
$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity Magellan
Fund on March 31, 1985, and paid a 3% sales charge. As the chart shows, by
March 31, 1995, the value of your investment would have grown to $49,016 -
a 390.16% increase on your initial investment. For comparison, look at how
the S&P 500 did over the same period. With dividends reinvested, the same
$10,000 investment would have grown to $38,549 - a 285.49% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
A first-quarter 1995 rally sparked
by diminishing concerns about
future interest rate increases,
combined with continued solid
corporate earnings, helped fuel
strong returns in the U.S. stock
market for the 12 months ended
March 31, 1995. The Standard and
Poor's Composite Index of 500
Stocks finished the 12-month period
with a total return of 15.57% -
topping its historical average annual
return of roughly 10%. Uncertainty
over the effects of rising interest
rates contributed to volatility and
uneven returns in the stock market
from March through December
1994. During the first three months
of 1995, however, evidence of a
gradual slowdown in economic
growth calmed inflation fears and
soothed worries about further
substantial interest rate increases
by the Federal Reserve Board.
These factors, along with continued
strong corporate earnings reports
and a flurry of merger and
acquisition activity, propelled stocks
higher. In February, the Dow Jones
Industrial Average closed above
4000 for the first time. Markets
outside the U.S., however,
continued to demonstrate the
volatility that marked most of 1994.
Mexico's devaluation of the peso in
December negatively affected
developed and, most notably,
emerging foreign markets, as
investors brought capital back to the
U.S. The Morgan Stanley Emerging
Markets Free Index was down
10.72% for the 12 months ended
March 31. Rising interest rates also
muted stock returns in several
developed markets, as the Morgan
Stanley EAFE (Europe, Australia,
Far East) Index returned 6.08% for
the same period.
An interview with Jeff Vinik, Portfolio Manager of Fidelity Magellan Fund
Q. JEFF, HOW DID THE FUND PERFORM?
A. The past 12 months has been a challenging period for relative
performance in the U.S. equity markets. From March 31, 1994, through March
31, 1995, the Magellan Fund produced a total return (appreciation plus
dividends) of 8.21% versus a total return of 9.17% for the average growth
fund tracked by Lipper Analytical Services.
Q. WHAT CAUSED THE FUND'S PERFORMANCE TO SLIGHTLY LAG ITS PEER GROUP
AVERAGE?
A. Three main factors contributed to the fund's relative underperformance
over the past year. First, the fund was overweighted relative to the broad
market, and many of its peers, in cyclical stocks - those whose earnings
rise and fall with the economy. These stocks were poor performers, as
investors shrugged off strong earnings reports and sold the stocks on fears
of slowing economic growth in the future and therefore slowing earnings
growth for these companies. Second, consumer nondurable stocks - less
economically sensitive groups like drugs, tobaccos, foods, beverages, and
so on - where the fund is underweighted, were very strong performers.
Investors bought these stocks on the basis that their earnings would hold
up best during the expected economic slowdown. Finally, the overall breadth
of the market was very poor. Small- and middle-capitalization stocks -
where the fund again is dramatically overweighted - significantly
underperformed large-capitalization issues. The biggest positive
contributing factor to the fund's performance was its heavy weighting in
technology, where many stocks, driven by strong earnings gains, were very
good performers.
Q. HAS THIS LED YOU TO CHANGE THE FUND'S MAKEUP?
A. Not significantly. Despite the ups and downs of the past 12 months, the
fund maintained its heavy weightings in technology and cyclicals at the end
of the period on the belief that companies in these sectors will produce
the best earnings gains over the next several years. In addition, the fund
maintained its gross underweighting in consumer nondurables - where I
expect profit growth to be disappointingly slow.
Q. WHY WAS THE FUND EMPHASIZING TECHNOLOGY STOCKS SO HEAVILY AT THE END OF
MARCH?
A. As a growth fund manager, it is my job to look for stocks that have the
best long-term earnings potential commensurate with manageable risk. When I
analyze the outlook for U.S. companies on a bottom-up basis - that is, I
analyze the outlook for each individual company - most of the best
investment ideas I find reside in the technology sector. There is no other
area of the U.S. stock market, bar none, in which I have found so many
companies performing so well with excellent short- and long-term earnings
outlooks, and selling at reasonable valuations - prices relative to
earnings. It is for this reason and this reason alone that technology
investments comprised more than 40% of the fund's total assets on March 31,
1995.
Q. WHY DO YOU THINK THE LONG-TERM OUTLOOK IS SO ATTRACTIVE FOR TECHNOLOGY
COMPANIES?
A. Quite simply, technology is growing extremely quickly in the U.S.
economy. Spending on information processing equipment has grown from about
3% of the country's gross domestic product in 1990 to approximately 5% of
GDP today - an annual growth rate that's many times faster than the
economy's overall growth rate. In fact, technology spending alone accounts
for more than one-third of the growth of the entire American economy over
the past four years, even though it represents only 5% of total output.
It's no wonder that so many technology companies have performed so well
financially.
Q. SO WHO IS SPENDING MONEY ON TECHNOLOGY AND WHAT ARE THEY BUYING?
A. This broad-based strength in technology spending is occurring in both
the consumer and corporate sectors of the economy. On the consumer side,
individuals are purchasing more electronic items - cellular phones,
personal computers, and so on with their disposable income. In addition,
the electronic content of goods such as automobiles, personal computers and
entertainment systems is growing strongly. On the corporate side, spurred
by a desire to be low-cost producers on a worldwide basis, U.S. companies
are investing heavily in capital spending. Almost 50 cents of every capital
spending dollar today is being spent on information processing equipment.
Importantly, these trends toward increased spending by individuals and
corporations on technology equipment show no signs of slowing down, and I
believe they likely will continue to be the locomotive of the U.S. economy
over the next few years. This should have positive implications for the
earnings outlooks for well-run, well-positioned, U.S. technology providers.
Additionally, technology stocks, despite their great long-term outlook, are
not expensive in the stock market. The price/earnings ratio of the
technology sector, both on an absolute basis and relative to the S&P 500,
is in the middle half of its historical range.
Q. LET'S DISCUSS SOME OF THE FUND'S LARGEST TECHNOLOGY INVESTMENTS . . .
A. Sure. Having completed its turnaround, IBM is in the process of
transforming itself into a growth company. With excellent cost control,
strong cash flow and improving revenue prospects, the company should report
surprisingly strong profits over the next several quarters. Despite
performing very well over the past year, the stock is attractively priced
at under 10 times expected 1995 earnings. Moving on, Motorola's long-term
earnings outlook is still intact, despite a recent hiccup from an
oversupply of U.S. cellular handsets. The company remains the premium
global supplier of semiconductors and wireless telecommunications
equipment. Having moved sideways for the past 18 months, the stock can now
be purchased for only 13 times next year's expected earnings - no premium
to the p/e ratio of the S&P 500 - despite a forecast of strong earnings
growth for the foreseeable future.
Q. HOW ABOUT ORACLE SYSTEMS AND INTEL, WHICH ARE ALSO AMONG THE FUND'S TOP
FIVE INVESTMENTS?
A. Oracle is the leader in the exploding worldwide market for relational
database software for client-server networks - the emerging paradigm for
corporate computing - and could produce powerful earnings gains over the
next two to three years. Yet the stock can be purchased for a price that's
20 times earnings, only half its growth rate. As a general rule, purchasing
growth stocks for a p/e ratio of 50% of their growth rates and selling them
at 100% is a good way to make money, as long as earnings meet or surpass
expectations. As for Intel, the personal computer industry is currently in
the heart of the Pentium microprocessor product cycle, powering strong
profit gains for Intel this year and next. Yet the stock sells at only 10
times this year's expected earnings.
Q. YOU MENTIONED THAT MANY CYCLICAL STOCKS WERE POOR PERFORMERS DURING THE
PERIOD. HAS YOUR THINKING ON THESE INVESTMENTS CHANGED OVER THE PAST SIX
MONTHS?
A. No. The fund maintained a large overweighting in cyclical stocks at the
end of March. These stocks encompassed a broad cross-section of industrial
America, including auto and auto parts companies, railroads, and industrial
equipment manufacturers. Driven by the lowest costs and the highest
productivity among the industrialized world, the U.S. manufacturing base is
poised to gain global market share for the foreseeable future, which could
lead to a multi-year period of strong revenue and earnings growth. Yet the
stock market has priced most U.S. cyclical stocks as if nothing has changed
from the 1980s, when their prosperity was short-lived. I strongly believe
that the strong profits of economically sensitive U.S. companies will
continue for years to come and the stocks, having in many cases corrected
20% or more over the past year, can be purchased at extremely attractive
valuation levels.
Q. CAN YOU GIVE US SOME SPECIFIC
EXAMPLES?
A. General Motors is one. Although its stock price is lower than it was a
year ago, GM may finally be getting its act together in terms of cost
control and new product introductions. With the auto cycle holding flat
through next year, GM should show the best earnings gains of the Big Three
U.S. auto makers over the next several quarters. Yet the stock is priced as
if a recession is imminent, at about its lowest valuation ever. CSX is
another example. This premier railroad company has been hitting on all
cylinders. Rail demand is robust, costs are under good control, cash flow
generation is strong and CSX's other businesses - a shipping company and
barge operation - are also performing extremely well. I believe that
excellent profit gains are possible for the next several years, but the
stock is valued at only 11 times this year's expected earnings. And
Caterpillar stock, despite continued good short-term business conditions
and an outstanding long-term competitive position, is priced as if 1995 is
the peak of the company's earnings cycle. I disagree, and expect good
profit growth over the next several years. Thus, the 9 p/e ratio is way too
low, in my view. Finally, Deere is another of the fund's larger cyclical
stocks. An export boom in U.S. agricultural products appears to be
unfolding, driven again by the nation's low cost position, which could lead
to an extended period of strong demand for U.S. farm equipment. As the
leader in the manufacturing and sale of tractors and combines, Deere may
enjoy several years of high profitability in my view, but the stock is
priced at 9 times earnings - like Caterpillar - as if this is the peak of
the agriculture cycle.
Q. FINANCIAL STOCKS MADE UP 11.4% OF THE FUND ON MARCH 31, COMPARED TO 6.2%
ONE YEAR AGO. WHY THE INCREASE?
A. The fund has approximately doubled its position in financial stocks over
the past year, as valuations have come down and earnings outlooks have
improved. My favorite areas in this sector are the U.S. brokerage stocks -
where business is poised to improve and valuations are relatively cheap -
insurance companies and selected banks.
Q. THE FEDERAL NATIONAL MORTGAGE ASSOCIATION, OR FANNIE MAE, HAS BEEN AMONG
THE FUND'S TOP 10 INVESTMENTS FOR QUITE SOME TIME . . .
A. It has. The stock fell roughly 25% in late 1994, which hurt the fund's
performance. However, the company's short-term business prospects are
beginning to strengthen, and this 13% long-term grower can be bought at
under 10 times this year's earnings. Merrill Lynch is another one of my
current favorites. The leading brokerage house in the world, Merrill bought
back 10% of its own stock over the past six months, an indication of how
attractively priced this company believes its stock to be. Given the trends
in the economy toward consumer saving and investment rather than
consumption, the company's earnings prospects seem promising. In addition,
BankAmerica, with a renewed emphasis on cost cutting and heavy stock
buybacks, should boost returns over the next two to three years. Selling at
a modest premium to book value, the stock should benefit.
Q. JEFF, OVER THE PAST TWO YEARS, YOU'VE BEEN PESSIMISTIC ABOUT THE
LONG-TERM POTENTIAL OF CONSUMER NONDURABLES AND RETAILERS. HAS THAT OPINION
CHANGED?
A. No. The fund remained heavily underweighted in both of these sectors at
the end of March. In fact, investments in these areas represented less than
5% of total assets on March 31, versus their roughly 25% weighting in the
S&P 500. I continue to strongly believe that profits for most consumer
staple companies and retailers will be disappointing over the next several
years. This will be due to oversupply - too many cereal brands, too many
specialty apparel stores, too many competing pharmaceuticals - and
debt-laden consumers purchasing lower-priced products. In addition, the
consumer nondurable stock prices are not cheap on an historical basis,
especially considering their strong performance over the past year.
Q. HOW ABOUT INTERNATIONAL STOCKS? WHAT'S YOUR LATEST VIEW?
A. At the end of March, the fund had less than 5% of its assets in
international investments, such as Nokia and Ericsson in the cellular
industry, KLM in the airline industry, and Philips N.V. in the
semiconductor industry. In general, I am finding that the best positioned,
best run, most competitive companies on a worldwide basis reside in the
United States.
Q. LET'S DISCUSS YOUR OUTLOOK. WHAT'S ON THE HORIZON?
A. As always, the short-term outlook for the U.S. stock market is 50/50 - a
flip of a coin. Nevertheless, the longer-term economic fundamentals of this
country are very positive. The U.S. has an extremely competitive
manufacturing base, continued low inflation, declining government deficits,
a pro-business investment climate and outstanding corporate earnings growth
prospects. While corrections can occur at any time in the stock market -
and Magellan Fund, given its aggressive positioning, has historically
underperformed the stock market during corrections - the long-term outlook
for the U.S. economy and the U.S. stock market remains positive. Hopefully,
good stock picking will be rewarded with good investment performance.
FUND FACTS
GOAL: to increase the value
of the fund's shares over the
long term by investing in
stocks with growth potential
START DATE: May 2, 1963
SIZE: as of March 31, 1995,
more than $39 billion
MANAGER: Jeffrey Vinik,
since July 1992; manager,
Fidelity Growth & Income
Portfolio, 1990 - 1992;
Fidelity Contrafund, 1989 -
1990; securities analyst,
1986 - 1989; joined Fidelity
in 1986
(checkmark)
JEFF VINIK ON THE FUND'S
EMPHASIS ON TECHNOLOGY
STOCKS:
"I don't really focus on how
the market behaves over a
week's, month's or even a
year's time. That stems from
my core belief that, over long
periods of time, company
earnings drive stock prices, not
the direction of interest rates,
foreign exchange rates, or any
other economic or market
factors. My strategy always
has been to build the fund
stock by stock, searching out
those companies that show
the best prospects for strong
earnings growth over the next
several years. And right now
I'm finding the vast majority of
these companies in the
technology sector.
"Historically, technology
stocks have been more
volatile than most. But the
majority of Magellan Fund's
shareholders have invested in
the fund for goals that are
years away, such as
retirement or college tuitions.
I think their objectives are the
same as mine, and that they
believe, as I do, that a
long-term approach is best."
(solid bullet) The fund's stake in
short-term and other
investments - was 1.3% on
March 31, down from 3.1% a
year ago. The fact that the
fund is nearly fully invested in
the market reflects the
manager's belief that more
stocks now offer compelling
earnings prospects coupled
with attractive valuations than
were available a year ago.
INVESTMENT CHANGES
TOP TEN STOCKS AS OF MARCH 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO
International Business Machines 2.3 1.7
Corp.
Motorola, Inc. 2.2 2.4
General Motors Corp. 2.0 0.5
Oracle Systems Corp. 2.0 1.8
Intel Corp. 1.9 1.3
Columbia/HCA Healthcare Corp. 1.5 1.3
Federal National Mortgage
Association 1.3 1.2
CSX Corp. 1.3 1.0
Hewlett-Packard Co. 1.3 0.9
Micron Technology, Inc. 1.3 0.6
TOP FIVE MARKET SECTORS AS OF MARCH 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET SECTORS
6 MONTHS AGO
Technology 42.6 32.1
Finance 11.4 9.8
Transportation 7.9 5.7
Industrial Machinery & Equipment 7.3 8.0
Durables 7.0 5.3
ASSET ALLOCATION
AS OF MARCH 31, 1995 AS OF SEPTEMBER 30, 1994
Row: 1, Col: 1, Value: 1.7
Row: 1, Col: 2, Value: 1.2
Row: 1, Col: 3, Value: 50.0
Row: 1, Col: 4, Value: 47.5
Row: 1, Col: 1, Value: 2.6
Row: 1, Col: 2, Value: 1.25
Row: 1, Col: 3, Value: 50.0
Row: 1, Col: 4, Value: 45.0
Stocks 98.3%
Bonds 0.4%
Short-term
and other
investments 1.3%
Stocks 96.5%
Bonds 0.9%
Short-term
and other
investments 2.6%
INVESTMENTS MARCH 31, 1995
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 98.1%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 0.3%
AEROSPACE & DEFENSE - 0.2%
Boeing Co. 1,070,100 $ 57,652
Teleflex, Inc. 105,500 4,246
61,898
DEFENSE ELECTRONICS - 0.1%
General Motors Corp. Class H 1,492,400 61,562
TOTAL Aerospace & Defense 123,460
BASIC INDUSTRIES - 3.8%
CHEMICALS & PLASTICS - 1.5%
Atlantis Group, Inc. (Trivest/Winston) (a)(h) 77,269 454
Cominco Fertilizer Ltd. 1,037,800 29,018
Dow Chemical Co. 522,600 38,150
Eastman Chemical Co. 251,448 13,987
Hanna (M.A.) Co. (g) 3,399,250 85,406
Hercules, Inc. 424,100 19,774
IMC Fertilizer Group, Inc. 601,800 29,413
Morton International, Inc. 2,660,500 77,155
PPG Industries, Inc. 2,131,600 80,468
Potash Corp. of Saskatchewan 1,245,900 55,205
Praxair, Inc. 1,739,700 40,448
Schulman (A.), Inc. 853,700 26,038
Union Carbide Corp. 1,339,500 41,022
Vigoro Corp. 509,200 18,840
Wellman, Inc. 1,357,000 34,264
589,642
IRON & STEEL - 1.8%
AK Steel Holding Corp. (a)(g) 2,439,000 66,158
Allegheny Ludlum Industries, Inc. 2,665,000 55,632
Armco, Inc. (a) 2,250,100 15,469
Bethlehem Steel Corp. (a) 3,637,600 58,656
Cleveland Cliffs, Inc. 146,500 5,640
Inland Steel Industries, Inc. (a)(g) 3,033,400 83,419
J & L Specialty Steel, Inc. 1,843,900 36,648
LTV Corp. (a) 3,950,381 60,243
LTV Corp. (warrants) (a) 1,013,857 3,295
Mueller Industries, Inc. (a)(g) 686,900 22,925
Nucor Corp. (g) 4,558,100 256,393
Quanex Corp. (g) 1,319,600 30,021
WHX Corp. (a)(g) 1,534,200 17,643
Worthington Industries, Inc. 622,000 12,362
724,504
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
BASIC INDUSTRIES - CONTINUED
METALS & MINING - 0.2%
Aluminum Co. of America 906,400 $ 37,502
Belden, Inc. (g) 1,996,300 43,919
81,421
PACKAGING & CONTAINERS - 0.0%
Corning, Inc. 100,000 3,600
Crown Packaging Holdings Ltd. (warrants) (a) 5,000 145
3,745
PAPER & FOREST PRODUCTS - 0.3%
Champion International Corp. 324,800 14,048
Federal Paper Board Co., Inc. 459,000 13,082
Georgia-Pacific Corp. 47,300 3,772
International Paper Co. 47,800 3,591
Temple-Inland, Inc. 835,200 37,480
Weyerhaeuser Co. 839,600 32,639
104,612
TOTAL BASIC INDUSTRIES 1,503,924
CONGLOMERATES - 0.8%
Harris Corp. (g) 3,941,600 188,704
Mark IV Industries, Inc. (g) 4,169,360 85,472
Standex International Corp. (g) 868,900 26,067
300,243
CONSTRUCTION & REAL ESTATE - 2.8%
BUILDING MATERIALS - 1.5%
Carlisle Companies, Inc. (g) 877,600 32,252
Centex Construction Products (a)(g) 1,615,000 19,986
Fastenal Co. 27,000 665
Lafarge Corp. (g) 5,208,180 97,653
Medusa Corp. (g) 1,645,900 40,119
National Gypsum Co. (a) 431,389 21,677
Owens-Corning Fiberglas Corp. (a) 1,319,400 47,498
Premdor, Inc. (a)(g) 3,008,900 22,310
Southdown, Inc. (a)(g) 1,538,300 26,151
Tecumseh Products Co. Class A (g) 1,293,400 64,023
Texas Industries, Inc. (g) 1,248,900 46,209
USG Corp. (a)(g) 4,508,000 103,684
United Dominion Industries Ltd. (g) 2,941,200 54,652
Vulcan Materials Co. 439,100 25,248
602,127
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONSTRUCTION & REAL ESTATE - CONTINUED
CONSTRUCTION - 0.7%
Centex Corp. (g) 2,963,100 $ 71,485
Clayton Homes, Inc. 1,545,000 26,458
Kaufman & Broad Home Corp. 1,000,500 11,881
Lennar Corp. 1,222,400 19,711
Oakwood Homes Corp. (g) 1,851,200 48,825
Pulte Corp. (g) 2,756,600 64,780
Toll Brothers, Inc. (a)(g) 2,558,600 29,744
272,884
ENGINEERING - 0.6%
Fluor Corp. 3,209,000 154,834
Foster Wheeler Corp. 347,400 11,768
Glenayre Technologies, Inc. (a)(g) 1,349,000 61,380
227,982
TOTAL CONSTRUCTION & REAL ESTATE 1,102,993
DURABLES - 7.0%
AUTOS, TIRES, & ACCESSORIES - 5.9%
APS Holding Corp. Class A (a) 296,800 7,568
Allen Group, Inc. (The) (g) 2,174,300 53,814
Bandag, Inc. 123,000 7,026
Borg-Warner Automotive, Inc. (g) 1,218,700 29,553
Breed Technologies, Inc. 782,400 17,115
Chrysler Corp. 3,781,200 158,338
Cooper Tire & Rubber Co. 2,201,800 62,476
Cummins Engine Co., Inc. 1,591,700 71,229
Dana Corp. 3,990,500 101,758
Danaher Corp. 1,034,100 29,601
Eaton Corp. 3,152,000 170,996
Echlin, Inc. (g) 4,513,900 173,785
General Motors Corp. 18,311,810 810,298
Johnson Controls, Inc. 1,123,800 57,173
Lear Seating Corp. (a) 937,000 16,866
Magna International, Inc. Class A (g) 5,332,330 202,928
Modine Manufacturing Co. 148,800 4,985
NACCO Industries, Inc. Class A (g) 818,846 44,627
Navistar International Corp. (a) 1,009,200 12,867
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
DURABLES - CONTINUED
AUTOS, TIRES, & ACCESSORIES - CONTINUED
PACCAR, Inc. 296,100 $ 12,584
Pep Boys-Manny, Moe & Jack 1,751,100 54,284
Smith (A.O.) Corp. Class B (g) 1,864,800 41,958
TRW, Inc. 2,638,800 181,747
2,323,576
CONSUMER ELECTRONICS - 0.6%
Black & Decker Corp. (g) 5,626,600 162,468
Harman International Industries, Inc. 741,600 27,532
Toro Co. (g) 1,087,000 31,115
221,115
HOME FURNISHINGS - 0.1%
Leggett & Platt, Inc. 1,170,500 49,161
TEXTILES & APPAREL - 0.4%
Collins & Aikman Corp. (a) 2,453,600 19,629
Fila Holding S.p.A. sponsored ADR 989,000 20,151
Nine West Group, Inc. (a)(g) 1,920,500 56,655
Tommy Hilfiger (a)(g) 3,484,000 76,648
173,083
TOTAL DURABLES 2,766,935
ENERGY - 1.3%
INDEPENDENT POWER - 0.2%
Thermo Electron Corp. (a) 1,561,100 79,421
OIL & GAS - 1.1%
Anderson Exploration Ltd. (a) 1,383,800 14,216
Apache Corp. 1,575,215 42,925
Devon Energy Corp. 873,000 18,333
Diamond Shamrock R&M, Inc. 181,300 4,782
Enron Oil & Gas Co. 1,637,000 40,311
Noble Affiliates, Inc. 1,041,300 28,506
Northstar Energy Corp. (a)(g) 2,101,300 18,772
Pogo Producing Co. 1,194,664 24,341
Renaissance Energy Ltd. (a)(g) 5,138,700 107,420
Renaissance Energy Ltd. (a)(i) 750,000 15,678
Snyder Oil Corp. (g) 2,102,900 30,755
Tosco Corp. (g) 2,588,300 80,237
Triton Energy Corp. (a) 40,000 1,529
427,805
TOTAL ENERGY 507,226
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - 11.4%
BANKS - 0.2%
Chemical Banking Corp. 1,747,100 $ 65,953
CREDIT & OTHER FINANCE - 2.3%
Banc One Corp. 500,000 14,250
BankAmerica Corp. 6,021,400 290,533
Countrywide Credit Industries, Inc. 934,100 16,230
Credit Acceptance Corp. (a) 637,700 14,029
Dean Witter Discover & Co. 2,840,377 115,745
Equitable Companies, Inc. (g) 10,720,700 235,855
Green Tree Acceptance, Inc. 1,318,100 54,042
Household International, Inc. 1,564,700 68,064
NBD Bancorp, Inc. 735,600 23,907
NationsBank Corp. 1,851,363 93,957
Non-Performing Mortgage Loan Trust (a) 17,701 974
United Companies Financial Corp. 10,000 345
927,931
FEDERAL SPONSORED CREDIT - 2.0%
Federal Home Loan Mortgage Corporation 4,509,700 272,837
Federal National Mortgage Association 6,569,700 534,609
807,446
INSURANCE - 3.1%
American International Group, Inc. 989,000 103,103
CIGNA Corp. 1,931,400 144,372
Chubb Corp. (The) 976,500 77,144
Conseco, Inc. 457,900 18,259
Equitable Iowa Companies (g) 1,634,100 55,355
First Colony Corp. 180,100 4,075
General Re Corp. 719,500 94,974
HealthCare COMPARE Corp. (a) 1,016,600 33,802
Jefferson Pilot Corp. 450,600 26,642
Lincoln National Corp. 2,534,600 102,018
MBIA, Inc. 1,498,400 94,212
MGIC Investment Corp. 490,200 19,976
Progressive Corp. (Ohio) 102,000 4,144
Reliastar Financial Corp. 1,311,600 44,594
Selective Insurance Group, Inc. 79,000 2,271
SunAmerica, Inc. (g) 2,082,100 90,311
TIG Holdings, Inc. 243,900 5,488
Transamerica Corporation 398,300 22,554
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - CONTINUED
INSURANCE - CONTINUED
Transatlantic Holdings, Inc. 342,700 $ 20,990
Travelers, Inc. (The) 5,591,864 215,986
20th Century Industries 91,900 1,080
USLIFE Corp. (g) 1,526,700 58,204
1,239,554
SAVINGS & LOANS - 0.3%
FirstFed Michigan Corp. (g) 1,165,050 28,252
GP Financial Corp. 2,235,900 51,705
TCF Financial Corp. 71,600 3,088
Washington Mutual, Inc. 682,100 13,685
96,730
SECURITIES INDUSTRY - 3.5%
Alex. Brown, Inc. 743,100 28,702
Bear Stearns Companies, Inc. 5,606,268 103,716
Edwards (A.G.), Inc. 3,020,000 66,440
Franklin Resources, Inc. 1,532,400 59,572
Lehman Brothers Holdings, Inc. 4,122,860 74,211
Merrill Lynch & Co., Inc. 9,395,299 400,475
Morgan Stanley Group, Inc. 3,797,500 255,857
PaineWebber Group, Inc. 3,775,475 60,880
Price (T. Rowe) Associates, Inc. 1,286,300 46,789
Quick & Reilly Group, Inc. (The) 216,500 7,686
Raymond James Financial, Inc. 338,400 5,795
Salomon, Inc. 2,572,300 87,137
Schwab (Charles) Corp. (g) 4,299,150 137,035
United Asset Management Corp. 872,000 33,463
1,367,758
TOTAL FINANCE 4,505,372
HEALTH - 2.8%
MEDICAL EQUIPMENT & SUPPLIES - 0.4%
Cardinal Health, Inc. (g) 2,994,150 142,596
Millipore Corp. 15,200 847
143,443
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
MEDICAL FACILITIES MANAGEMENT - 2.4%
Columbia/HCA Healthcare Corp. 13,696,502 $ 588,950
HEALTHSOUTH Rehabilitation Corp. (a) 1,695,100 68,863
Health Management Associates, Inc. Class A (a)(g) 2,403,558 69,403
Humana, Inc. (a) 6,240,300 159,908
Oxford Health Plans, Inc. (a) 1,412,600 79,106
966,230
TOTAL HEALTH 1,109,673
INDUSTRIAL MACHINERY & EQUIPMENT - 7.3%
ELECTRICAL EQUIPMENT - 2.2%
Adtran, Inc. (a) 183,900 10,252
American Power Conversion Corp. (a) 1,629,800 26,688
AMETEK, Inc. 892,700 16,180
Ampex Corp.:
Class A (a) 56,144 88
Class A (warrants) (a) 160,023 250
Class C (a)(g) 639,039 998
Amphenol Corp. Class A (a)(g) 4,555,300 113,883
Antec Corp. (a)(g) 1,189,600 28,550
Asea AB Free shares Series B 137,300 10,753
Avid Technology, Inc. (a)(g) 849,600 25,700
California Microwave Corp. (a)(g) 809,700 20,243
Itel Corp. (a)(g) 2,729,900 104,760
Oak Industries, Inc. (a)(g) 1,718,800 44,259
Philips Electronics NV 4,405,500 150,338
Philips Electronics 3,299,900 112,341
Scientific-Atlanta, Inc. (g) 6,228,000 145,580
Sensormatic Electronics Corp. 801,400 22,439
Vicor Corp. (a)(g) 811,300 27,584
Zenith Electronics Corp. (a) 2,190,400 16,976
877,862
INDUSTRIAL MACHINERY & EQUIPMENT - 5.1%
AGCO Corp. (g) 1,921,650 63,655
Atlas Copco AB Free shares Class A 239,400 2,892
Briggs & Stratton Corp. 80,000 2,950
Case Corp. (g) 5,875,500 146,888
Caterpillar, Inc. 7,660,300 426,104
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
Cincinnati Milacron, Inc. (g) 2,621,600 $ 59,969
Clark Equipment Co. (a)(g) 1,739,700 143,525
Cooper Industries, Inc. 1,471,400 57,017
Deere & Co. 3,777,000 306,881
Detroit Diesel Corp. (a) 357,300 8,575
Donaldson Company, Inc. 391,400 9,785
Dover Corp. 501,700 32,485
Greenfield Industries, Inc. 599,400 16,933
Harnischfeger Industries, Inc. 1,159,500 32,466
IDEX Corp. (g) 962,550 28,756
Illinois Tool Works, Inc. 3,123,100 152,642
Ingersoll-Rand Co. 100,000 3,274
Kaydon Corp. 720,700 19,008
Kennametal, Inc. (g) 2,651,854 71,269
Parker-Hannifin Corp. (g) 4,040,500 178,792
Thermadyne Holdings Corp. (a) 3,688 53
TRINOVA Corp. (g) 2,878,500 88,154
Varity Corp. (a)(g) 4,288,100 162,947
2,015,020
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 2,892,882
MEDIA & LEISURE - 2.7%
BROADCASTING - 0.9%
British Sky Broadcasting Group 5,500,000 22,704
British Sky Broadcasting Group ADR (a) 292,000 7,191
Clear Channel Communications, Inc. (a) 184,100 10,954
Gaylord Entertainment Co. Class A 798,400 20,958
Infinity Broadcasting Corp. (a) 737,900 30,807
Viacom, Inc.:
Class A (a) 324,160 14,830
Class B (non-vtg.) (a) 5,359,819 239,852
347,296
ENTERTAINMENT - 0.4%
Carnival Cruise Lines, Inc. Class A 2,542,278 59,426
Cedar Fair LP (depositary units) 120,400 3,793
Cineplex Odeon Corp. (a) 1,860,700 3,617
EuroDisneyland (a) 14,979,000 40,223
Royal Caribbean Cruises Ltd. 1,540,100 40,235
Spelling Entertainment Group, Inc. 1,163,300 11,923
159,217
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - CONTINUED
LEISURE DURABLES & TOYS - 0.8%
ARCTCO, Inc. 448,300 $ 6,725
Brunswick Corp. (g) 8,855,500 178,217
Cobra Golf, Inc. (a)(g) 1,685,100 47,183
Fleetwood Enterprises, Inc. 701,000 16,561
Harley Davidson, Inc. 1,802,000 43,248
Mattel, Inc. 1,381,875 34,029
Polaris Industries, Inc. 66,900 3,228
Sports and Recreation, Inc. (a) 14,600 167
329,358
LODGING & GAMING - 0.5%
Bally Gaming International, Inc. (warrants) (a) 225,000 1,519
Bally's Grand, Inc. (warrants) (a) 61,691 254
Grand Casinos, Inc. (a) 549,900 12,579
Host Marriott Corp. (a)(g) 12,977,200 154,104
La Quinta Motor Inns, Inc. 483,900 13,126
Maritime Group Ltd. (warrants) (a) 17,040 -
Prime Hospitality Corp. (a)(g) 1,553,000 16,307
Sun International Hotels Ltd. (a) 32,689 1,079
198,968
RESTAURANTS - 0.1%
Lone Star Steakhouse Saloon (a) 100,000 2,713
Outback Steakhouse, Inc. (a) 1,002,700 25,443
28,156
TOTAL MEDIA & LEISURE 1,062,995
NONDURABLES - 0.1%
AGRICULTURE - 0.0%
Pioneer Hi-Bred International, Inc. 498,700 17,953
BEVERAGES - 0.0%
Heileman G Brewing, Inc. Class 1 (non-vtg.) (a)(h) 340 5,440
HOUSEHOLD PRODUCTS - 0.1%
Premark International, Inc. 1,012,600 44,681
TOTAL NONDURABLES 68,074
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - 3.7%
APPAREL STORES - 0.2%
Brown Group, Inc. (g) 1,064,400 $ 30,868
Gymboree Corp. (a)(g) 1,626,000 41,260
Lamonts Apparel, Inc. (a) 143,486 36
Lamonts Apparel, Inc. (warrants) (a) 264,824 -
Talbots, Inc. 642,300 21,757
93,921
APPLIANCE STORES - 0.0%
Cellstar Corp. (a)(g) 951,400 19,028
DRUG STORES - 0.5%
Eckerd Corp. (a) 405,200 11,903
General Nutrition Companies, Inc. (a) 816,900 22,669
Revco (D.S.), Inc. (a)(g) 5,126,797 117,916
Rite Aid Corp. 2,128,900 52,158
204,646
GENERAL MERCHANDISE STORES - 0.3%
Federated Department Stores, Inc. (a) 721,177 15,956
Federated Department Stores , Inc.:
Class C (warrants) (a) 341,542 1,878
Class D (warrants) (a) 341,542 1,921
Mac Frugals Bargains C/O, Inc. (a)(g) 2,079,000 29,886
Michaels Stores, Inc. (a)(g) 1,462,500 48,628
Woolworth Corp. 852,100 15,657
113,926
GROCERY STORES - 0.3%
Food 4 Less Holdings, Inc. (warrants) (a) 1,169 35
Grand Union Capital Corp. Class B (a) 6,979 -
Grand Union Co. (warrants) (a) 1,749 -
Kroger Co. (The) (a) 2,801,900 73,900
Safeway, Inc. (a) 532,700 18,511
Stop & Shop Companies, Inc. (a) 371,000 8,904
101,350
RETAIL & WHOLESALE, MISCELLANEOUS - 2.4%
Barnes & Noble, Inc. (a)(g) 1,999,500 60,735
Bed Bath & Beyond, Inc. (a) 818,700 20,263
CDW Computer Centers, Inc. (a) 180,000 6,480
Lowe's Companies, Inc. (g) 12,810,100 441,948
Micro Warehouse, Inc. (a)(g) 1,871,400 58,013
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
RETAIL & WHOLESALE, MISCELLANEOUS - CONTINUED
Officemax, Inc. (a) 1,211,400 $ 31,042
Office Depot, Inc. (a) 2,287,500 55,758
Petsmart, Inc. (a) 1,136,000 39,760
Staples, Inc. (a)(g) 3,711,000 97,878
Sunglass Hut International, Inc. (a) 667,100 19,763
Tandy Corp. 1,643,700 78,487
Viking Office Products, Inc. (a) 663,900 20,581
930,708
TOTAL RETAIL & WHOLESALE 1,463,579
SERVICES - 2.5%
ADVERTISING - 0.4%
Omnicom Group, Inc. (g) 3,085,744 168,944
LEASING & RENTAL - 0.0%
GATX Corp. 502,000 22,465
PRINTING - 0.3%
ASM Lithography Holding NV 851,200 23,940
Bowne & Co., Inc. (g) 1,610,800 25,974
Reynolds & Reynolds Co. Class A (g) 2,056,400 56,551
106,465
SERVICES - 1.8%
Block (H & R), Inc. (g) 5,811,500 252,074
CDI Corp. (a) 869,000 21,182
Gartner Group, Inc. Class A (a) 143,500 6,171
Interim Services, Inc. (a) 337,400 10,038
Kelly Services, Inc. Class A (g) 1,737,300 62,543
Manpower, Inc. (g) 7,438,100 238,949
Robert Half International, Inc. (a)(g) 2,753,500 70,214
Service Corp. International 1,175,500 32,914
True North Communications 718,700 13,385
707,470
TOTAL SERVICES 1,005,344
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - 42.4%
COMMUNICATIONS EQUIPMENT - 6.1%
ADC Telecommunications, Inc. (a) 1,744,700 $ 51,469
Andrew Corp. (a) 1,175,550 47,904
Bolt Beranek & Newman, Inc. (a) 631,700 12,397
Broadband Technologies, Inc. (a) 152,700 3,856
Cisco Systems, Inc. (a) 117,300 4,472
DSC Communications Corp. (a)(g) 7,113,700 231,640
Ericsson (L.M.) Telephone Co.:
Class B 2,767,400 172,228
Class B ADR 2,343,700 144,870
General DataComm Industries, Inc. (a)(g) 1,297,800 19,143
General Instrument Corp. (a)(g) 9,653,200 335,449
Network Equipment Technologies (a)(g) 1,527,600 38,763
Network General Corp. (a)(g) 1,467,200 41,815
Nokia Corp. AB (g) 3,154,500 460,244
Nokia Corp. AB sponsored ADR 555,200 40,807
Nokia Corp. Free shares 482,600 70,971
Northern Telecom Ltd. 3,840,100 145,453
Tellabs, Inc. (a)(g) 4,352,300 253,521
3Com Corp. (a)(g) 5,664,700 320,764
U.S. Robotics Corp. (a) 386,800 24,173
2,419,939
COMPUTER SERVICES & SOFTWARE - 8.2%
Adobe Systems, Inc. 783,300 38,773
Alantec Corp. (a)(g) 660,800 29,571
America Online, Inc. (a)(g) 1,167,100 86,657
American Management Systems, Inc. (a) 340,900 6,605
Ascend Communications, Inc. (a)(g) 918,600 59,479
Broderbund Software, Inc. (a) 729,400 37,838
CUC International, Inc. (a) 4,146,158 161,182
Cambridge Technology Partners Mass., Inc. (a) 78,600 2,208
Ceridian Corp. (a) 1,741,900 58,136
Cerner Corp. (a) 202,200 9,807
Chipcom Corp. (a) 468,700 17,693
Computer Associates International, Inc. 7,317,200 434,459
Compuware Corp. (a)(g) 2,679,200 99,130
Continuum Co., Inc. (a)(g) 1,750,900 52,089
Corel Systems Corp. (a) 1,832,600 24,066
Davidson & Associates, Inc. (a) 262,500 8,794
Electronic Arts, Inc. (a) 1,749,200 39,576
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - CONTINUED
FTP Software, Inc. (a) 770,000 $ 24,448
HBO & Co. 1,392,800 60,587
Hyperion Software, Inc. (a) 49,500 2,314
Informix Corp. (a)(g) 3,816,200 131,182
Lotus Development Corp. (a)(g) 4,183,690 160,026
Microsoft Corp. (a) 4,191,600 298,128
Netmanage, Inc. (a) 856,900 35,990
Novell, Inc. (a) 722,800 13,733
Oracle Systems Corp. (a)(g) 25,007,300 781,478
Parametric Technology Corp. (a) 1,543,000 61,720
Paychex, Inc. 821,800 37,803
Policy Management Systems Corp. (a) 255,700 11,219
Reuters Holdings PLC:
Ord. 2,550,000 19,628
ADR Class B 2,925,300 134,564
SafeCard Services, Inc. (g) 1,992,600 38,108
Santa Cruz Operation, Inc. (a) 712,600 9,798
Softkey International, Inc. (a)(g) 938,000 25,561
Sterling Software, Inc. (a)(g) 1,810,877 63,154
Stratacom, Inc. (a)(g) 2,631,780 113,167
Sybase, Inc. (a) 1,849,280 73,969
3,262,640
COMPUTERS & OFFICE EQUIPMENT - 11.2%
AST Research, Inc. (a) 1,168,200 18,545
ADAPTEC, Inc. (a)(g) 4,173,200 137,716
Amdahl Corp. (a)(g) 8,248,400 90,732
Apple Computer, Inc. 3,974,800 140,112
Bay Networks, Inc. 200,000 7,375
Comdisco, Inc. 1,523,300 40,748
Compaq Computer Corp. (a) 12,053,200 415,835
Dell Computer Corp. (a)(g) 3,933,000 172,069
Diebold, Inc. 973,800 34,692
Digital Equipment Corp. (a)(g) 10,027,000 379,773
Exabyte (a)(g) 1,707,500 29,454
Fore Systems, Inc. (a)(g) 2,532,000 100,014
Gateway 2000, Inc. (a)(g) 6,546,300 122,743
Hewlett-Packard Co. 4,214,400 507,308
International Business Machines Corp. 11,158,300 913,586
Komag, Inc. (a)(g) 2,234,500 70,387
Madge NV (a) 454,500 10,624
Quantum Corp. (a)(g) 4,076,200 60,633
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTERS & OFFICE EQUIPMENT - CONTINUED
Read Rite Corp. (a)(g) 3,754,700 $ 71,809
SCI Systems, Inc. (a) 1,005,100 18,783
Seagate Technology (a)(g) 7,269,900 202,648
Silicon Graphics, Inc. (a)(g) 10,464,200 371,479
Sun Microsystems, Inc. (a) 1,768,300 61,448
Symbol Technologies, Inc. (a)(g) 2,519,000 77,459
Tandem Computers, Inc. (a)(g) 7,661,500 118,753
Western Digital Corp. (a)(g) 4,541,200 62,442
Xerox Corp. 1,852,200 217,402
4,454,569
ELECTRONIC INSTRUMENTS - 2.9%
Analogic Corp. (g) 1,235,400 23,473
Applied Materials, Inc. (a)(g) 7,729,100 426,067
Elsag Baily Process Automat NV (a) 108,200 3,030
KLA Instruments Corp. (a)(g) 1,532,100 96,905
Lam Research Corp. (a)(g) 2,641,100 118,189
Measurex Corp. 319,600 7,950
Novellus System, Inc. (a) 806,600 50,009
Tektronix, Inc. (g) 3,069,900 122,796
Teradyne, Inc. (a)(g) 3,635,100 150,857
Varian Associates, Inc. (g) 3,397,900 143,137
X-Rite, Inc. 49,300 961
1,143,374
ELECTRONICS - 14.0%
Advanced Micro Devices, Inc. (a)(g) 9,581,500 324,573
Altera Corp. (a)(g) 1,483,800 82,907
AMP, Inc. 384,000 13,824
Analog Devices, Inc. (a)(g) 4,185,550 106,732
Applied Digital Access, Inc. (a) 105,200 1,683
Arrow Electronics, Inc. (a)(g) 4,609,600 194,179
Atmel Corp. (a)(g) 4,205,541 162,439
Augat, Inc. (g) 1,899,620 34,906
Avnet, Inc. (g) 3,987,345 160,989
Berg Electronics Holdings Corp. (a)(i) 218,280 1,091
C-Cube Microsystems, Inc. (a) 350,600 6,136
Cascade Communications Corp. (a)(g) 1,220,300 84,201
Cirrus Logic, Inc. (a)(g) 2,651,100 90,137
Cypress Semiconductor Corp. (a)(g) 3,891,200 108,467
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
ELECTRONICS - CONTINUED
Cyrix Corp. (a)(g) 1,865,700 $ 40,812
Dallas Semiconductor Corp. 855,300 15,716
Electroglas, Inc. (a)(g) 871,700 38,137
Integrated Device Technology, Inc. (a)(g) 3,716,570 137,513
Intel Corp. 8,782,600 745,423
International Rectifier Corp. (a)(g) 2,132,300 51,175
Kemet Corp. (a)(g) 950,500 35,763
Kent Electronics Corp. (a) 296,250 8,739
LSI Logic Corp. (a)(g) 5,993,400 314,654
Lattice Semiconductor Corp. (a)(g) 1,866,400 45,843
Linear Technology Corp. (g) 2,156,500 120,764
Marshall Industries (a)(g) 1,632,500 42,445
Maxim Integrated Products, Inc. (a)(g) 2,096,800 76,533
Microchip Technology, Inc. (a)(g) 3,121,200 87,784
Micron Technology, Inc. (g) 6,564,300 498,887
Motorola, Inc. 16,110,000 880,009
National Semiconductor Corp. (a)(g) 12,318,980 215,582
Pioneer Standard Electronics, Inc. (g) 1,491,094 27,212
SGS-Thomson Microelectronic NV (a) 1,848,900 55,005
SGS-Thomson Microelectronics NV (a) 43,100 1,301
Solectron Corp. (a) 958,200 28,027
Texas Instruments, Inc. (g) 4,974,000 440,199
Thomas & Betts Corp. 688,300 44,567
VLSI Technology, Inc. (a)(g) 3,615,200 65,074
Vishay Intertechnology, Inc. 495,285 27,798
Wyle Laboratories (g) 1,226,100 29,886
Xilinx, Inc. (a)(g) 1,213,100 82,188
Zilog, Inc. (a) 324,800 11,612
5,540,912
TOTAL TECHNOLOGY 16,821,434
TRANSPORTATION - 7.9%
AIR TRANSPORTATION - 2.1%
AMR Corp. (a)(g) 4,652,400 301,243
Air Canada, Inc. (a)(g) 7,171,300 33,954
British Airways PLC Ord. 7,600,000 50,256
Delta Air Lines, Inc. 737,400 46,272
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TRANSPORTATION - CONTINUED
AIR TRANSPORTATION - CONTINUED
KLM Royal Dutch Airlines (a) 2,338,000 $ 69,556
KLM Royal Dutch Airlines Ord. (a) 2,175,700 64,174
Northwest Airlines Corp. Class A (a) 2,346,600 63,652
Pittston Company Services Group (g) 4,452,900 122,455
UAL Corp. (g) 647,100 67,946
ValuJet Airlines (a) 96,800 4,719
824,227
RAILROADS - 4.1%
Bombardier, Inc. Class B 4,026,500 77,696
Burlington Northern, Inc. 4,239,200 251,703
CSX Corp. (g) 6,672,800 525,483
Canadian Pacific Ltd. Ord. 5,542,800 82,691
Conrail, Inc. (g) 7,382,500 414,343
Illinois Central Corp., Series A 1,235,076 42,610
Kansas City Southern Industries, Inc. (g) 2,913,400 118,357
Trinity Industries, Inc. 1,890,900 70,672
Wisconsin Central Transportation Corp. (a) 703,900 33,523
1,617,078
SHIPPING - 0.2%
American President Companies Ltd. (g) 1,464,800 32,043
Kirby Corp. (a)(g) 2,605,400 45,595
77,638
TRUCKING & FREIGHT - 1.5%
Air Express International Corp. 719,900 18,357
Airborne Freight Corp. (g) 1,520,100 31,732
American Freightways Corp. (a) 1,436,500 32,680
Arkansas Best Corp. (g) 1,758,600 18,685
Consolidated Freightways, Inc. (g) 3,628,600 96,611
Federal Express Corp. (a) 2,434,300 164,620
Fritz Companies, Inc. (a) 387,500 24,897
Landstar System, Inc. (a)(g) 862,700 27,175
Rollins Truck Leasing Corp. 2,210,975 27,637
Swift Transportation Co., Inc. (a)(g) 2,317,600 35,923
TNT Freightways Corp. (g) 2,143,900 50,918
Werner Enterprises, Inc. 34,900 698
XTRA Corp. (g) 1,688,000 79,758
609,691
TOTAL TRANSPORTATION 3,128,634
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - 1.3%
CELLULAR - 0.9%
Airtouch Communications (a) 4,573,600 $ 124,631
Paging Network, Inc. (a) 1,282,100 42,950
QUALCOMM, Inc. (a) 200,000 6,550
Vanguard Cellular Systems, Inc. Class A (a) 1,440,300 32,407
Vodafone Group PLC sponsored ADR 5,106,900 169,166
375,704
GAS - 0.0%
Seagull Energy Corp. (a) 1,032,074 20,383
TELEPHONE SERVICES - 0.4%
ALC Communications Corp. (a) 100,600 3,433
LCI International, Inc. (a) 597,300 14,858
LDDS Communications, Inc. (a) 5,112,200 119,498
MFS Communications, Inc. (a) 77,400 2,709
140,498
TOTAL UTILITIES 536,585
TOTAL COMMON STOCKS
(Cost $31,911,017) 38,899,353
NONCONVERTIBLE PREFERRED STOCKS - 0.2%
DURABLES - 0.0%
AUTOS, TIRES, & ACCESSORIES - 0.0%
Harvard Industries, Inc. pay-in-kind $14.25 (a) 54,746 1,478
INDUSTRIAL MACHINERY & EQUIPMENT - 0.0%
ELECTRICAL EQUIPMENT - 0.0%
Ampex Corp. 8% (a)(h) 4,415 2,389
TECHNOLOGY - 0.2%
COMPUTER SERVICES & SOFTWARE - 0.2%
Sap AG 71,740 55,931
TOTAL NONCONVERTIBLE PREFERRED STOCKS
(Cost $61,042) 59,798
CORPORATE BONDS - 0.4%
MOODY'S RATINGS (E) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (D) (000S) (000S)
CONVERTIBLE BONDS - 0.0%
BASIC INDUSTRIES - 0.0%
PAPER & FOREST PRODUCTS - 0.0%
Repap Enterprises, Inc.:
8 1/2%, 8/1/97 - $ 250 $ 276
9%, 6/30/98 - CAD 12,900 8,436
8,712
CONGLOMERATES - 0.0%
Polly Peck International PLC 7 1/4%,
1/4/05 (c) - 1,300 65
INDUSTRIAL MACHINERY & EQUIPMENT - 0.0%
ELECTRICAL EQUIPMENT - 0.0%
Ampex Corp. 0%, 6/30/97 - 1,305 635
RETAIL & WHOLESALE - 0.0%
APPAREL STORES - 0.0%
Dylex Ltd. 9%, 8/15/00 (b) - CAD 140 41
DRUG STORES - 0.0%
Big B, Inc. 6 1/2%, 3/15/03 B2 3,500 4,121
TOTAL RETAIL & WHOLESALE 4,162
TOTAL CONVERTIBLE BONDS 13,574
NONCONVERTIBLE BONDS - 0.4%
BASIC INDUSTRIES - 0.2%
CHEMICALS & PLASTICS - 0.1%
Arcadian Partners LP 10 3/4%, 5/1/05 B2 1,500 1,470
IMC Fertilizer Group, Inc. 9 1/4%, 10/1/00 B1 3,950 3,990
Trans Resources, Inc.:
14 1/2%, 9/1/96 B2 5,000 5,050
11 7/8%, 7/1/02 (i) B2 2,500 2,250
12,760
PACKAGING & CONTAINERS - 0.0%
Crown Packaging Holdings Ltd.
0%, 11/1/03 (f) Caa 14,480 6,950
Crown Packaging Ltd. 10 3/4%, 11/1/00 B3 5,000 4,950
11,900
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (E) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (D) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
BASIC INDUSTRIES - CONTINUED
PAPER & FOREST PRODUCTS - 0.1%
Repap Enterprises, Inc.:
euro 9.0625%, 7/21/97 (j) - $ 3,552 $ 3,445
9.0625%, 7/21/97 (j) - 9,681 9,390
Stone Container Corp.:
10 3/4%, 6/15/97 B2 5,770 5,929
11 7/8%, 12/1/98 B1 6,330 6,694
9 7/8%, 2/1/01 B1 9,000 8,753
34,211
TOTAL BASIC INDUSTRIES 58,871
CONSTRUCTION & REAL ESTATE - 0.0%
BUILDING MATERIALS - 0.0%
Adience, Inc. 11%, 6/15/02 (b) - 3,995 2,897
USG Corp. 9 1/4%, 9/15/01 B1 285 277
3,174
CONSTRUCTION - 0.0%
Hillsborough/Jim Walter Corp. 17%, 1/1/96 (b) Ca 1,816 1,271
TOTAL CONSTRUCTION & REAL ESTATE 4,445
DURABLES - 0.0%
TEXTILES & APPAREL - 0.0%
Leslie Fay Cos., Inc.:
9.53%, 1/15/00 (b)(h) - 8,931 5,626
10.54%, 1/15/02 (b)(h) - 8,073 4,279
9,905
INDUSTRIAL MACHINERY & EQUIPMENT - 0.0%
INDUSTRIAL MACHINERY & EQUIPMENT - 0.0%
Thermadyne Holdings Corp.:
10 1/4%, 5/1/02 - 632 607
10 3/4%, 11/1/03 - 1,957 1,908
2,515
POLLUTION CONTROL - 0.0%
Envirosource, Inc. 9 3/4%, 6/15/03 B3 2,400 2,088
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 4,603
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (E) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (D) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
MEDIA & LEISURE - 0.1%
BROADCASTING - 0.1%
Citicasters, Inc. 9 3/4%, 2/15/04 B- $ 18,750 $ 18,328
Robin Media Group, Inc. 11 1/8%, 4/1/97 - 10,000 9,775
SCI Television, Inc. secured 7 1/2%,
6/30/98 (j) - 6,591 6,508
34,611
LODGING & GAMING - 0.0%
Bally Gaming International, Inc.
10 3/8%, 7/15/98 - 7,500 7,031
Host Marriott Corp. 10 1/2%, 5/1/06 B1 4,686 4,663
Maritime Group Ltd. pay-in-kind
0%, 2/15/97 (b) (f) - 1,571 707
Sun International Hotels Ltd. 10 1/2%,
12/12/95 (h) - 246 246
12,647
RESTAURANTS - 0.0%
Cafeteria Operators LP 11%, 6/30/98 (b)(h) - 5,000 1,250
TOTAL MEDIA & LEISURE 48,508
RETAIL & WHOLESALE - 0.0%
APPAREL STORES - 0.0%
Lamonts Apparel Corp. 10 1/4%, 11/1/99 (b)(i) - 8,804 4,534
SERVICES - 0.0%
PRINTING - 0.0%
BFP Holdings Corp. 0%, 4/15/04 (f) Caa 10,093 5,955
TECHNOLOGY - 0.0%
COMPUTERS & OFFICE EQUIPMENT - 0.0%
Alpine Group, Inc. 13 1/2%, 1/5/96 (h) Caa 640 634
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (E) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (D) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
UTILITIES - 0.1%
ELECTRIC UTILITY - 0.1%
Del Norte Funding Corp. secured leasing oblig.
11 1/4%, 1/2/14 (b) Ca $ 8,965 $ 5,469
El Paso Funding Corp. lease oblig.:
9 3/8%, 10/1/96 (b) Ca 6,175 3,767
10 3/4%, 4/1/13 (b) Ca 3,340 2,037
11,273
GAS - 0.0%
Columbia Gas Systems, Inc.:
7 1/2%, 6/1/97 (b) Caa 3,080 3,634
10.15%, 11/1/13 (b) Caa 2,900 3,901
7,535
TOTAL UTILITIES 18,808
TOTAL NONCONVERTIBLE BONDS 156,263
TOTAL CORPORATE BONDS
(Cost $174,394) 169,837
COMMERCIAL MORTGAGE SECURITIES - 0.0%
Bardell Associates Note Trust 12 1/2%,
11/1/08 (h) - 4,880 4,959
La Salle National Trust NA, Trust No. 118501
Mortgage Note 11 3/4%, 12/29/08 (h) - 5,986 5,986
TOTAL COMMERCIAL MORTGAGE SECURITIES
(Cost $10,947) 10,945
FOREIGN GOVERNMENT OBLIGATIONS (K) - 0.0%
Argentina Republic BOTE 1.7325%,
5/31/96 (j) (Cost $3,620) - 15,000 3,874
OTHER SECURITIES - 0.1%
PRINCIPAL VALUE (NOTE 1)
AMOUNT (D) (000S) (000S)
PURCHASED BANK DEBT - 0.1%
El Paso Electric Co. (b):
unsecured loan $ 29,666 $ 20,888
variable secured loan 2,856 2,742
GPA Group PLC CCF (b) 13,563 11,935
Leslie Fay Cos., Inc. (b):
revolving loan 9,057 5,706
term loan 10,268 6,469
Queens Moat Houses PLC loan (b) 727 167
Trivest 1992 Special Fund Ltd. loan 26.6(l) 6,767
TOTAL PURCHASED BANK DEBT 54,674
TRADE CLAIMS RECEIVABLE - 0.0%
Hills Stores (Bear) (a) 434 308
TOTAL OTHER SECURITIES
(Cost $60,211) 54,982
REPURCHASE AGREEMENTS - 1.2%
MATURITY
AMOUNT
(000S)
Investments in repurchase agreements
(U.S. Treasury obligations) in a joint
trading account at 6.20%, dated
3/31/95 due 4/3/95 $ 465,233 464,993
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $32,686,224) $ 39,663,782
CURRENCY ABBREVIATIONS
CAD - Canadian dollar
LEGEND
(a) Non-income producing
(b) Non-income producing - issuer filed for protection under the Federal
Bankruptcy Code or is in default of interest payment.
(c) Non-income producing - the company moved to seek a court appointed
administrator under British bankruptcy law.
(d) Principal amount is stated in United States dollars unless otherwise
noted.
(e) Standard & Poor's Corporation credit ratings are used in the absence of
a rating by Moody's Investors Service, Inc.
(f) Debt obligation initially issued in zero coupon form which converts to
coupon form at a specified rate and date.
(g) Affiliated company (see Note 7 of Notes to Financial Statements).
(h) 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 COST
SECURITY DATE (000S)
Alpine Group, Inc.
13 1/2%, 1/5/96 1/4/95 $ 628
Ampex Corp. 8% 2/16/95 $ 2,318
Atlantis Group, Inc.
(Trivest/Winston) 4/16/93 $ 90
Bardell Associates
Note Trust 12 1/2%,
11/1/08 4/19/94 $ 4,961
Cafeteria Operators
LP 11%, 6/30/98 6/24/93 $ 4,000
Heileman G
Brewing, Inc. Class1 1/21/94 $ 6,800
ACQUISITION
ACQUISITION COST
SECURITY DATE (000S)
La Salle National
Trust NA, Trust
No. 118501
Mortgage Note 11 3/4%,
12/29/08 12/29/93 $ 5,986
Leslie Fay Cos., Inc.:
9.53%, 1/15/00 7/13/93 $ 6,765
10.54%, 1/15/02 7/19/93
to 11/11/93 $ 5,337
Sun International
Hotels Ltd. 10 1/2%,
12/12/95 12/12/94 $ 246
(i) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $23,553,000 or 0.1% of net
assets.
(j) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(k) Some foreign government obligations have not been individually rated by
S&P or Moody's. The ratings listed are assigned to securities by FMR, the
fund's investment adviser, based principally on S&P and Moody's ratings of
the sovereign credit of the issuing government.
(l) Represents number of units held.
INCOME TAX INFORMATION
At March 31, 1995, the aggregate cost of investment securities for income
tax purposes was $32,971,818,000. Net unrealized appreciation aggregated
$6,691,964,000, of which $7,406,034,000 related to appreciated investment
securities and $714,070,000 related to depreciated investment securities.
At March 31, 1995, the fund had a capital loss carryforward of
approximately $505,673,000 which will expire on March 31, 2003.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNTS) MARCH 31, 1995
ASSETS
Investment in securities, at value (including repurchase $ 39,663,782
agreements of $464,993) (cost $32,686,224) -
See accompanying schedule
Receivable for investments sold 934,161
Receivable for fund shares sold 101,156
Dividends receivable 45,606
Interest receivable 3,579
Other receivables 3,441
TOTAL ASSETS 40,751,725
LIABILITIES
Payable to custodian bank $ 16
Payable for investments purchased 838,953
Payable for fund shares redeemed 77,474
Accrued management fee 23,921
Other payables and accrued expenses 8,855
TOTAL LIABILITIES 949,219
NET ASSETS $ 39,802,506
Net Assets consist of:
Paid in capital $ 33,433,273
Undistributed net investment income 179,833
Accumulated undistributed net realized gain (loss) on (788,286)
investments and foreign currency transactions
Net unrealized appreciation (depreciation) on 6,977,686
investments and assets and liabilities in foreign
currencies
NET ASSETS, for 549,429 shares outstanding $ 39,802,506
NET ASSET VALUE and redemption price per share $72.44
($39,802,506 (divided by) 549,429 shares)
Maximum offering price per share (100/97.00 of $72.44) $74.68
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED MARCH 31, 1995
INVESTMENT INCOME $ 401,813
Dividends (including $99,250 received from
affiliated issuers)
Interest 82,508
TOTAL INCOME 484,321
EXPENSES
Management fee $ 221,687
Basic fee
Performance adjustment 46,744
Transfer agent fees 78,547
Accounting fees and expenses 833
Non-interested trustees' compensation 505
Custodian fees and expenses 1,119
Registration fees 2,114
Audit 405
Legal 270
Interest 19
Miscellaneous 916
Total expenses before reductions 353,159
Expense reductions (9,606) 343,553
NET INVESTMENT INCOME 140,768
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities (including realized loss of (627,990)
$148,638 on sales of investment in affiliated issuers)
Foreign currency transactions (3,593) (631,583)
Change in net unrealized appreciation (depreciation) on:
Investment securities 3,487,407
Assets and liabilities in foreign currencies 14,844 3,502,251
NET GAIN (LOSS) 2,870,668
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 3,011,436
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED YEAR ENDED
MARCH 31, MARCH 31,
1995 1994
INCREASE (DECREASE) IN NET ASSETS
Operations $ 140,768 $ 320,022
Net investment income
Net realized gain (loss) (631,583) 2,923,182
Change in net unrealized appreciation (depreciation) 3,502,251 (33,846)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 3,011,436 3,209,358
FROM OPERATIONS
Distributions to shareholders (68,245) (300,411)
From net investment income
From net realized gain (1,283,877) (2,583,157)
TOTAL DISTRIBUTIONS (1,352,122) (2,883,568)
Share transactions 10,274,501 10,878,472
Net proceeds from sales of shares
Reinvestment of distributions 1,329,944 2,833,537
Cost of shares redeemed (6,580,719) (5,804,748)
Net increase (decrease) in net assets resulting from 5,023,726 7,907,261
share transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS 6,683,040 8,233,051
NET ASSETS
Beginning of period 33,119,466 24,886,415
End of period (including undistributed net investment $ 39,802,506 $ 33,119,466
income of $179,833 and $94,879, respectively)
OTHER INFORMATION
Shares
Sold 151,903 150,758
Issued in reinvestment of distributions 19,889 41,356
Redeemed (97,417) (80,692)
Net increase (decrease) 74,375 111,422
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED MARCH 31,
1995 1994 1993 1992 1991
SELECTED PER-SHARE DATA
Net asset value, beginning $ 69.72 $ 68.44 $ 68.13 $ 64.84 $ 58.60
of period
Income from Investment Operations
Net investment income .27 .61 1.20 .81 1.39
Net realized and unrealized 5.22 7.92 9.18 9.21 8.10
gain (loss)
Total from investment 5.49 8.53 10.38 10.02 9.49
operations
Less Distributions (.14) (.75) (1.25) (1.30) (.83)
From net investment income C
From net realized gain (2.63) (6.50) (8.82) (5.43) (2.42)
C
Total distributions (2.77) (7.25) (10.07) (6.73) (3.25)
Net asset value, end of period $ 72.44 $ 69.72 $ 68.44 $ 68.13 $ 64.84
TOTAL RETURN A, B 8.21% 12.94% 17.06% 16.48% 17.26%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 39,803 $ 33,119 $ 24,886 $ 19,824 $ 14,808
(in millions)
Ratio of expenses to average .96% .99% 1.00% 1.05% 1.06%
net assets
Ratio of expenses to average net .99% 1.00% 1.00% 1.05% 1.06%
assets before expense reductions
Ratio of net investment income to .39% 1.07% 2.11% 1.57% 2.47%
average net assets
Portfolio turnover rate 120% 132% 155% 172% 135%
</TABLE>
A TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE.
B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN
(SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
C THE AMOUNTS SHOWN REFLECT CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO
TAX DIFFERENCES (SEE NOTE 1 OF NOTES TO FINANCIAL STATEMENTS).
NOTES TO FINANCIAL STATEMENTS
For the period ended March 31, 1995
1. SIGNIFICANT ACCOUNTING
POLICIES.
Fidelity Magellan Fund (the fund) is registered under the Investment
Company Act of 1940, as amended (the 1940 Act), as an open-end management
investment company organized as a Massachusetts business trust and is
authorized to issue an unlimited number of shares. The following summarizes
the significant accounting policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are readily
available are valued at the last sale price, or if no sale price, at the
closing bid price. Securities (including restricted securities) for which
exchange quotations are not readily available (and in certain cases debt
securities which trade on an exchange), are valued primarily using
dealer-supplied valuations or at their fair value as determined in good
faith under consistently applied procedures under the general supervision
of the Board of Trustees. Short-term securities maturing within sixty days
of their purchase date are valued at amortized cost or original cost plus
accrued interest, both of which approximate current value.
FOREIGN CURRENCY TRANSLATION.
The accounting records of the fund are maintained in U.S. dollars.
Investment securities and other assets and liabilities denominated in a
foreign currency are translated into U.S. dollars at the prevailing rates
of exchange at period end. Purchases and sales of securities, income
receipts, and expense payments are translated into U.S. dollars at the
prevailing exchange rate on the respective dates of the transactions.
Effective April 1, 1994, the fund adopted Statement of Position (SOP) 93-4:
Foreign Currency Accounting and Financial Statement Presentation for
Investment Companies. In accordance with this SOP, net realized gains and
losses on foreign currency transactions represent net gains and losses from
sales and maturities of forward currency contracts, disposition of foreign
currencies, currency gains and losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amount of net investment income accrued and the U.S. dollar amount actually
received. Further, as permitted under the SOP, the effects of changes in
foreign currency exchange rates on investments in securities are not
segregated in the Statement of Operations from the effects of changes in
market prices of those securities, but are included with the net realized
and unrealized gain or loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
the fund is informed of the ex-dividend date. Interest income is accrued as
earned. Investment income is recorded net of foreign taxes withheld where
recovery of such taxes is uncertain.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for litigation
proceeds, paydown gains/losses on certain securities, foreign currency
transactions, market discount, partnerships, non-taxable dividends, capital
loss carryforwards, and losses deferred due to wash sales. The fund also
utilized earnings and profits distributed to shareholders on redemption of
shares as a part of the dividends paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect net investment income per share. Undistributed net investment income
and accumulated undistributed net realized gain (loss) on investments and
foreign currency transactions may include temporary book and tax basis
differences which will reverse in a subsequent period. Any taxable income
or gain remaining at fiscal year end is distributed in the following year.
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.
FORWARD FOREIGN CURRENCY
CONTRACTS. The fund may use foreign currency contracts to facilitate
transactions in foreign securities and to manage the fund's currency
exposure. Contracts to buy generally are used to acquire exposure to
foreign currencies, while contracts to sell are used to hedge the fund's
investments against currency fluctuations. Also, a contract to buy or sell
can offset a previous contract. Losses may arise from changes in the value
of the foreign currency or if the counterparties do not perform under the
contracts' terms.
The U.S. dollar value of forward foreign currency contracts is determined
using forward currency exchange rates supplied by a quotation service.
Purchases and sales of forward foreign currency contracts having the same
settlement date and broker are offset and any realized gain (loss) is
recognized on the date of offset; otherwise, gain (loss) is recognized on
settlement date.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of Fidelity Management & Research
2. OPERATING POLICIES - CONTINUED
JOINT TRADING ACCOUNT - CONTINUED
Company (FMR), may transfer uninvested cash balances into one or more joint
trading accounts. These balances are invested in one or more repurchase
agreements that mature in 60 days or less from the date of purchase, and
are collateralized by U.S. Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. FMR, the fund's
investment adviser, is responsible for determining that the value of these
underlying securities remains at least equal to the resale price.
RESTRICTED SECURITIES. The fund is permitted to invest in privately placed
restricted securities. These securities 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 $31,263,000 or .08% of net assets.
3. PURCHASES AND SALES
OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $45,896,228,000 and $41,975,452,000, respectively, of which U.S.
government and government agency obligations aggregated $12,492,000 and
$1,717,819,000, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
basic fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR. The
rates ranged from .2850% to .5200% for the period April 1, 1994 to July 31,
1994 and .2700% to .5200% for the period August 1, 1994 to March 31, 1995.
In the event that these rates were lower than the contractual rates in
effect during those periods, FMR voluntarily implemented the above rates,
as they resulted in the same or a lower management fee. The annual
individual fund fee rate is .30%. The basic fee is subject to a performance
adjustment (up to a maximum of (plus/minus) .20%) based on the fund's
investment performance as compared to the appropriate index over a
specified period of time. For the period, the management fee was equivalent
to an annual rate of .75% of average net assets after the performance
adjustment.
SALES LOAD. For the period, Fidelity Distributors Corporation (FDC), an
affiliate of FMR and the general distributor of the fund, received sales
charges of $25,195,000 on sales of shares of the fund.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
TRANSFER AGENT FEES. Fidelity Service Co. (FSC), an affiliate of FMR, is
the fund's transfer, dividend disbursing and shareholder servicing agent.
During the period April 1, 1994 to December 31, 1994, FSC received fees
based on the type, size, number of accounts and the number of transactions
made by shareholders. Effective January 1, 1995, the Board of Trustees
approved a revised transfer agent contract pursuant to which FSC receives
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.
ACCOUNTING FEES. FSC maintains the fund's accounting records. The fee is
based on the level of average net assets for the month plus out-of-pocket
expenses.
BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid
to these affiliated firms were $26,981,000 for the period.
5. BANK BORROWINGS.
The fund is permitted to have bank borrowings for temporary or emergency
purposes to fund shareholder redemptions. The fund has established
borrowing arrangements with certain banks. Under the most restrictive
arrangement, the fund must pledge to the bank securities having a market
value in excess of 220% of the total bank borrowings. The interest rate on
the borrowings is the bank's base rate, as revised from time to time. The
maximum loan and the average daily loan balances during the periods for
which loans were outstanding amounted to $172,136,000. The weighted average
interest rate was 3.875%.
6. EXPENSE REDUCTIONS.
FMR has directed certain portfolio trades to brokers who paid a portion of
the fund's expenses. For the period, the fund's expenses were reduced by
$9,606,000 under this arrangement.
7. TRANSACTIONS WITH
AFFILIATED COMPANIES.
An affiliated company is a company in which the fund has ownership of at
least 5% of the voting securities. Transactions with companies which are or
were affiliates are as follows:
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES
DOLLAR AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
ADAPTEC, Inc. (a) $ 33,089 $ 50,819 $ - $ 137,716
AGCO Corp. 19,247 - 32 63,655
AK Steel Holding Corp. (a) 28,102 - - 66,158
AMR Corp. (a) 43,113 - - 301,243
AST Research, Inc. (a) 19,565 30,146 - -
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES - CONTINUED
DOLLAR AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
Advanced Micro Devices, Inc. (a) $ 128,320 $ 100,853 $ - $ 324,573
Air Canada, Inc. (a) 9,501 2,266 - 33,954
Airborne Freight Corp. 13,333 3,109 350 31,732
Alantec Corp. (a) 8,160 - - 29,571
Allen Group, Inc. (The) 17,850 - 346 53,814
Altera Corp. (a) 44,144 36,606 - 82,907
Amdahl Corp. (a) 14,947 24,887 - 90,732
America Online, Inc. (a) 15,045 - - 86,657
American President Companies Ltd. - 4,134 613 32,043
Ampex Corp. Class C (a) 1,438 - - 998
Amphenol Corp. Class A (a) 25,534 - - 113,883
Anadarko Petroleum Corp. - 12,882 - -
Analog Devices, Inc. (a) 31,422 24,683 - 106,732
Analogic Corp. - - 49 23,473
Anderson Exploration Ltd. (a) 278 22,141 - -
Antec Corp. (a) 34,782 32,322 - 28,550
Apache Corp. 20,706 64,888 856 -
Applied Materials, Inc. (a) 254,621 101,622 - 426,067
Arkansas Best Corp. - 1,340 74 18,685
Armstrong World Industries, Inc. 21,051 54,914 1,645 -
Arrow Electronics, Inc. (a) 122,079 12,438 - 194,179
Ascend Communications, Inc. (a) 17,086 - - 59,479
Atmel Corp. (a) 52,174 29,762 - 162,439
Augat, Inc. - - 228 34,906
Avid Technology, Inc. (a) 11,900 7,909 - 25,700
Avnet, Inc. 52,384 7,758 1,999 160,989
Barnes & Noble, Inc. (a) 3,749 - - 60,735
Belden, Inc. 13,503 - 181 43,919
Best Buy Co., Inc. 49,463 81,331 - -
Biogen, Inc. 4,133 5,506 - -
Black & Decker Corp. 41,727 5,119 979 162,468
Block (H & R), Inc. 22,213 - 1,630 252,074
Borg-Warner Automotive, Inc. - - - 29,553
Boston Chicken, Inc. 7,438 8,956 - -
Bowne & Co., Inc. 16,819 2,347 572 25,974
Breed Technologies, Inc. 10,383 12,573 93 -
Briggs & Stratton Corp. 9,684 24,740 401 -
Brown Group, Inc. 18,782 19,122 2,319 30,868
Brunswick Corp. 34,376 6,297 4,086 178,217
Burlington Coat Factory Warehouse 12,553 28,109 - -
Burlington Resources, Inc. - 125,366 1,143 -
CSX Corp. 161,208 77,262 8,050 525,483
Cabot Corp. 1,124 20,171 632 -
California Microwave Corp. (a) 4,592 - - 20,243
Canadian Natural Resources Ltd. 10,106 17,968 - -
Cardinal Health, Inc. 45,485 10,207 355 142,596
Carlisle Companies, Inc. 3,823 - - 32,252
Carson Pirie Scott & Co. 6,877 6,498 - -
Cascade Communications Corp. (a) 33,156 - - 84,201
Case Corp. 43,579 - 503 146,888
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES - CONTINUED
DOLLAR AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
Cedar Fair LP (depository units) $ - $ 4,480 $ - $ -
Cellstar Corp. (a) - - - 19,028
Centex Construction Products (a) 22,610 - - 19,986
Centex Corp. 28,686 2,270 590 71,485
Ceridian Corp. (a) 18,415 22,249 - -
Chipcom Corp. (a) 5,846 10,719 - -
Chiquita Brands, Inc. 3,707 7,008 128 -
Circuit City Stores, Inc. 62,933 69,228 477 -
Cincinnati Milacron, Inc. 22,025 317 384 59,969
Cirrus Logic, Inc. (a) 71,806 41,307 - 90,137
Claire's Stores, Inc. 88 8,486 45 -
Clark Equipment Co. (a) 56,578 999 - 143,525
Clayton Homes, Inc. 16,900 18,949 - -
Coast Savings Financial, Inc. - 679 - -
Cobra Golf, Inc. (a) 24,647 571 - 47,183
Columbia/HCA Healthcare Corp. 89,419 41,295 536 -
Compuware Corp. (a) 58,185 57,530 - 99,130
Conner Peripherals, Inc. 18,063 46,635 - -
Conrail, Inc. 176,327 3,346 2,429 414,343
Consolidated Freightways, Inc. 38,647 - - 96,611
Consolidated Stores Corp. - 31,210 - -
Continuum Co., Inc. (a) 21,920 - - 52,089
Cordis Corp. 8,609 33,971 - -
Cypress Semiconductor Corp. (a) 17,724 12,444 - 108,467
Cyrix Corp. (a) 67,511 48,052 - 40,812
DSC Communications Corp. (a) 115,894 87,103 - 231,640
Dallas Semiconductor Corp. 1,653 2,570 - -
Dell Computer Corp. (a) 105,648 58,743 - 172,069
Devon Energy Corp. 740 9,831 123 -
Diamond Shamrock R&M, Inc. 14,759 20,397 757 -
Diebold, Inc. 6,341 43,384 2,206 -
Digital Equipment Corp. (a) 87,326 - - 379,773
Dress Barn, Inc. - 13,215 - -
EMC Corp. 72,671 94,242 - -
Echlin, Inc. 23,691 25,217 2,895 173,785
Electroglas, Inc. (a) 15,036 292 - 38,137
Energy Service Co., Inc. - 26,255 - -
Equitable Companies, Inc. 63,189 - 1,029 235,855
Equitable Iowa Companies 1,398 - - 55,355
Exabyte (a) 12,820 11,421 - 29,454
FirstFed Michigan Corp. - - 652 28,252
Fleetwood Enterprises, Inc. 775 50,827 639 -
Foote Cone & Belding
Communications, Inc. 278 13,393 758 -
Fore Systems, Inc. (a) 39,420 - - 100,014
Foster Wheeler Corp. 2,737 25,521 423 -
Frontier Insurance Group, Inc. 2,904 3,049 78 -
Gateway 2000, Inc. (a) 63,298 - - 122,743
General DataComm Industries, Inc. (a) 21,450 15,812 - 19,143
General Instrument Corp. (a) 210,464 119,084 - 335,449
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES - CONTINUED
DOLLAR AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
Glenayre Technologies, Inc. (a) $ 18,448 $ 13,713 $ - $ 61,380
Gymboree Corp. (a) 34,878 27,249 - 41,260
Hanna (M.A.) Co. 39,418 - 730 85,406
Harman International Industries, Inc. 9,596 9,120 74 -
Harris Corp. 79,758 8,566 4,255 188,704
Health Management Associates, Inc.
Class A (a) 2,305 - - 69,403
HealthCare COMPARE Corp. (a) 29,761 31,145 - -
Host Marriott Corp. (a) 47,561 - - 154,104
Hudson Bay Corp. - 12,177 - -
IDEX Corp. - - - 28,756
Indresco, Inc. - 12,898 - -
Informix Corp. (a) 21,703 8,134 - 131,182
Inland Steel Industries, Inc. (a) 24,264 6,860 - 83,419
Integrated Device Technology, Inc. (a) 77,767 29,101 - 137,513
International Rectifier Corp. (a) 18,989 - - 51,175
Intelligent Electronics, Inc. 15,066 41,132 851 -
Itel Corp. (a) 8,550 17,249 - 104,760
Jones Apparel Group, Inc. - 1,408 - -
KLA Instruments Corp. (a) 45,446 26,633 - 96,905
Kansas City Southern Industries, Inc. 14,888 7,515 937 118,357
Kelly Services, Inc. Class A 11,577 - - 62,543
Kemet Corp. (a) 3,454 - - 35,763
Kennametal, Inc. 22,134 318 792 71,269
Kent Electronics Corp. (a) - 612 - -
Kirby Corp. (a) 19,398 - - 45,595
Komag, Inc. (a) 3,583 238 - 70,387
LSI Logic Corp. (a) 44,601 - - 314,654
Lafarge Corp. 38,759 2,429 1,239 97,653
Lam Research Corp. (a) 68,926 24,957 - 118,189
Landstar System, Inc. (a) 2,308 - - 27,175
Lattice Semiconductor Corp. (a) 32,332 12,956 - 45,843
La-Z-Boy Chair Co. - 13,204 207 -
Lennar Corp. 15,040 9,573 94 -
Linear Technology Corp. 15,531 - 297 120,764
Lotus Development Corp. (a) 27,641 38,761 - 160,026
Lowe's Companies, Inc. 152,816 36,239 2,085 441,948
MS Carriers, Inc. - 9,002 - -
Mac Frugals Bargains C/O, Inc. (a) 19,112 5,822 - 29,886
Magna International, Inc. Class A 119,093 32,578 1,818 202,928
Manpower, Inc. 115,925 - 731 238,949
Mark IV Industries, Inc. 25,962 7,296 403 85,472
Marshall Industries (a) 6,642 7,769 - 42,445
Maxim Integrated Products, Inc. (a) 20,793 - - 76,533
Maytag Co. 52,839 53,135 987 -
McKesson Corp. - 95,598 1,556 -
Medusa Corp. 12,691 - 792 40,119
Merrill Lynch & Co., Inc. - 5,343 2,014 -
Mesa, Inc. 7,743 11,286 - -
Michael's Stores, Inc. (a) 36,559 20,528 - 48,628
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES - CONTINUED
DOLLAR AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
Micro Warehouse, Inc. (a) $ 4,208 $ 3,482 $ - $ 58,013
Microchip Technology, Inc. (a) 44,359 6,873 - 87,784
Micron Technology, Inc. 129,578 125,609 1,521 498,887
Mitchell Energy & Development
Corp. Class A 904 3,812 145 -
Mueller Industries, Inc. (a) 766 6,226 - 22,925
NACCO Industries, Inc. Class A 21,514 2,359 512 44,627
Nabors Industries, Inc. - 12,229 - -
National Gypsum Co. (a) 22,470 38,671 - -
National Semiconductor Corp. (a) 86,094 29,213 - 215,582
Network Equipment Technologies (a) 11,309 - - 38,763
Network General Corp. (a) 16,122 7,998 - 41,815
Nine West Group, Inc. (a) 5,022 39,345 - 56,655
Noble Affiliates, Inc. 16,806 34,667 383 -
Noble Drilling Corp. - 4,023 - -
Nokia Corp. AB 56,384 1,889 - 460,244
Northstar Energy Corp. (a) - 5,473 - 18,772
Novellus Systems, Inc. (a) 5,776 10,721 - -
Nucor Corp. 11,109 2,675 504 256,393
Oak Industries, Inc. (a) 20,794 11,074 - 44,259
Oakwood Homes Corp. 6,824 977 75 48,825
Omnicom Group, Inc. 21,002 13,401 3,963 168,944
Oracle Systems Corp. (a) 116,951 21,391 - 781,478
Paine Webber Group, Inc. - 1,669 1,374 -
Parker Drilling Co. - 18,970 - -
Parker & Parsley Petroleum Co. 36,555 66,404 238 -
Parker-Hannifin Corp. 68,317 - 2,756 178,792
Payless Cashways, Inc. 4,126 27,061 - -
Petsmart, Inc. (a) 4,598 14,908 - -
Pinnacle West Capital Corp. - 60,343 1,381 -
Pioneer Standard Electronics, Inc. 398 - 185 27,212
Pittston Company Services Group 2,675 - 891 122,455
Pogo Producing Co. 648 20,353 262 -
Powersoft Corp. 5,632 18,394 - -
Premark International, Inc. 1,411 17,358 - -
Premdor, Inc. (a) 1,411 6,607 - 22,310
Prime Hospitality Corp. (a) - - - 16,307
Pulte Corp. 1,813 2,312 661 64,780
Quanex Corp. 15,409 326 364 30,021
Quantum Corp. (a) 45,646 47,096 - 60,633
Read Rite Corp. (a) 25,602 - - 71,809
Reading & Bates Corp. - 28,559 - -
Recognition Equipment, Inc. - 10,909 - -
Renaissance Energy Ltd. (a) 7,082 64,934 - 107,420
Revco (D.S.), Inc. (a) 37,150 5,907 - 117,916
Reynolds & Reynolds Co. Class A - 2,689 209 56,551
Rite Aid Corp. 9,845 38,831 1,627 -
Robert Half International, Inc. (a) 28,572 - - 70,214
SR Telecom, Inc. 531 1,570 - -
SafeCard Services, Inc. 7,763 11,053 412 38,108
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES - CONTINUED
DOLLAR AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
San Juan Basin Royalty Trust $ - $ 12,879 $ 456 $ -
Sanifill, Inc. - 953 - -
Santa Fe Pacific Corp. - 49,058 - -
Schwab (Charles) Corp. - - - 137,035
Scientific-Atlanta, Inc. 53,352 21,224 351 145,580
Seagate Technology (a) 109,770 45,584 - 202,648
Seagull Energy Corp. (a) 25,254 35,880 - -
Sensormatic Electronics Corp. 23,487 26,321 192 -
Showboat, Inc. - 14,604 75 -
Silicon Graphics, Inc. (a) 103,247 13,938 - 371,479
SkyWest, Inc. 13,289 23,940 224 -
Smith (A.O.) Corp. Class B 18,793 29 783 41,958
Snyder Oil Corp. 2,573 6,959 555 30,755
Softkey International, Inc. (a) 4,618 850 - 25,561
Southdown, Inc. (a) 13,491 - - 26,151
Spiegel, Inc. 12,020 16,874 75 -
Springs Industries, Inc. - 4,951 - -
Standex International Corp. 3,587 - 455 26,067
Staples, Inc. (a) 14,482 805 - 97,878
Starbucks 22,334 24,031 - -
Sterling Software, Inc. (a) 24,037 - - 63,154
Stratacom, Inc. (a) 3,952 - - 113,167
Swift Transportation Co., Inc. (a) 382 1,670 - 35,923
SunAmerica, Inc. 25,423 17,434 915 90,311
Sybase, Inc. (a) 210,429 218,444 - -
Symbol Technologies, Inc. (a) 36,182 2,897 - 77,459
TNT Freightways Corp. 22,561 1,060 717 50,918
TRINOVA Corp. 55,559 9,996 1,662 88,154
Tandem Computers, Inc. (a) 42,769 9,042 - 118,753
Tecumseh Products Co. Class A 18,544 - 1,811 64,023
Tektronix, Inc. 54,706 4,170 1,402 122,796
Tellabs, Inc. (a) 140,605 49,413 - 253,521
Teradyne, Inc. (a) 63,057 15,865 - 150,857
Texas Industries, Inc. 17,044 - 283 46,209
Texas Instruments, Inc. 117,602 118,315 3,996 440,199
3Com Corp. (a) 97,101 44,425 - 320,764
Tidewater, Inc. 1,307 33,830 391 -
Toll Brothers, Inc. (a) 9,859 4,910 - 29,744
Tommy Hilfiger (a) 16,965 - - 76,648
Toro Co. 12,429 - 130 31,115
Tosco Corp. 3,000 3,103 1,683 80,237
Transcanada Pipelines Ltd. - 55,833 - -
Triton Energy Corp. (a) 17,478 25,750 - -
UAL Corp. 6,350 10,317 - 67,946
USG Corp. (a) 13,534 5,068 - 103,684
USLIFE Corp. 13,215 - 882 58,204
U.S. Robotics, Inc. (a) 9,750 26,833 - -
U.S. Surgical Corp. 7,860 10,971 53 -
United Dominion Industries Ltd. 15,349 - - 54,652
VLSI Technology, Inc. (a) 13,573 12,920 - 65,074
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES - CONTINUED
DOLLAR AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
Varian Associates, Inc. $ 46,312 $ 4,705 $ 998 $ 143,137
Varity Corp. (a) 32,663 4,885 - 162,947
Vicor Corp. (a) 1,226 - - 27,584
Vintage Petroleum, Inc. 2,008 6,952 42 -
WHX Corp. (a) 1,188 575 - 17,643
Waban, Inc. 11,700 36,277 - -
Walbro Corp. - 13,287 74 -
Wallace Computer Services, Inc. 15,300 18,976 722 -
Wellman, Inc. 13,936 15,503 400 -
West Coast Energy, Inc. - 23,622 - -
Western Digital Corp. (a) 31,797 9,659 - 62,442
Wyle Laboratories 2,419 2,112 334 29,886
XTRA Corp. - - 979 79,758
Xilinx, Inc. (a) - - - 82,188
TOTALS $ 7,204,283 $ 4,765,756 $ 99,250 $ 19,482,536
(a) NON-INCOME PRODUCING.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and the Shareholders of Fidelity Magellan Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Magellan Fund, including the schedule of portfolio investments, as
of March 31, 1995, and the related statement of operations for the year
then ended, the statement of changes in net assets for each of the two
years in the period then ended and the financial highlights for each of the
five years in the period then ended. These financial statements and
financial highlights are the responsibility of the fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of March 31, 1995 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles
used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Magellan Fund as of March 31, 1995, the results of its
operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for
each of the five years in the period then ended, in conformity with
generally accepted accounting principles.
?s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
May 2, 1995
DISTRIBUTIONS
A total of 53% of the dividends distributed during the fiscal year
qualifies for the dividends-received deductions for corporate shareholders.
A total of 3.5% of the dividends distributed during the fiscal year was
derived from interest on U.S. government securities which is generally
exempt from state income tax.
The fund will notify shareholders in January 1996 of the applicable
percentage for use in preparing 1995 income tax returns.
TO CALL FIDELITY
FOR FUND INFORMATION AND QUOTES
The Fidelity Telephone Connection offers you special automated telephone
services for quotes and balances. The services are easy to use,
confidential and quick. All you need is a Touch Tone telephone.
YOUR PERSONAL IDENTIFICATION NUMBER
(PIN)
The first time you call one of our automated telephone services, we'll ask
you
to set up your Personal Identification
Number (PIN). The PIN assures that
only you have automated telephone
access to your account information.
Please have your Customer Number
(T-account #) handy when you call -
you'll need it to establish your PIN. If
you would ever like to change your PIN, just choose the "Change your
Personal
Identification Number" option when
you call. If you forget your PIN, please
call a Fidelity representative at 1-800-
544-6666 for assistance.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)MUTUAL FUND QUOTES*
1-800-544-8544
Just make a selection from this record-ed menu:
PRESS
For quotes on funds you own.
1.
For an individual fund quote.
2.
For the ten most frequently
requested Fidelity fund quotes.
3.
For quotes on Fidelity Select
Portfolios(registered trademark).
4.
To change your Personal
Identification Number (PIN).
5.
To speak with a Fidelity
representative.
6.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)MUTUAL FUND ACCOUNT
BALANCES 1-800-544-7544
Just make a selection from this record-
ed menu:
PRESS
For balances on funds you own.
1.
For your most recent fund activity
(purchases, redemptions, and
dividends).
2.
To change your Personal
Identification Number (PIN).
3.
To speak with a Fidelity
representative.
4.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT IN
A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and send
you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
100 Crosby Parkway - KP2C
Covington, KY 41015-4399
SELLING SHARES
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
Fidelity Investments
P.O. Box 30281
Salt Lake City, UT 84130-0281
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions
World Trade Center
164 Northern Avenue
Boston, MA 02210
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
851 East Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
811 Wilshire Boulevard
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
1400 Civic Drive
Walnut Creek, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
185 Asylum Street
Hartford, CT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
90 Alhambra Plaza
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
4001 Tamiami Trail, North
Naples, FL
1907 West State Road 434
Orlando, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
2000 66th Street, North
St. Petersburg, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
One North Franklin
Chicago, IL
540 Lake Cook Road
Deerfield, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
44 Mall Road
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
26955 Northwestern Hwy.
Southfield, MI
MINNESOTA
38 South Sixth Street
Minneapolis, MN
MISSOURI
700 West 47th Street
Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
60B South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
505 Millburn Avenue
Short Hills, NJ
NEW YORK
1050 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
1271 Avenue of the
Americas
New York, NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
10 Bank Street
White Plains, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
1903 East Ninth Street
Cleveland, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
Dallas, TX
1155 Dairy Ashford
Houston, TX
2701 Drexel Drive
Houston, TX
1010 Lamar Street
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
UTAH
215 South State Street
Salt Lake City, UT
VERMONT
199 Main Street
Burlington, VT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
1001 Fourth Avenue
Seattle, WA
WASHINGTON, DC
1775 K Street, N.W.
Washington, DC
WISCONSIN
222 East Wisconsin Avenue
Milwaukee, WI
INVESTMENT ADVISER
Fidelity Management & Research
Company
Boston, MA
INVESTMENT SUB-ADVISER
Fidelity Management & Research
(U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Jeffrey Vinik, Vice President
Arthur S. Loring, Secretary
Stephen P. Jonas, Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Robert H. Morrison, Manager,
Security Transactions
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox*
Phyllis Burke Davis*
Richard J. Flynn*
Edward C. Johnson 3d
E. Bradley Jones*
Donald J. Kirk*
Peter S. Lynch
Edward H. Malone*
Marvin L. Mann*
Gerald C. McDonough*
Thomas R. Williams*
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co.
Boston, MA
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
FIDELITY GROWTH FUNDS
Blue Chip Growth Fund
Capital Appreciation Fund
Contrafund
Disciplined Equity Fund
Dividend Growth Fund
Emerging Growth Fund
Fidelity Fifty
Growth Company Fund
Low-Priced Stock Fund
Magellan(registered trademark) Fund
Mid-Cap Stock Fund
New Millennium(trademark) Fund
OTC Portfolio
Retirement Growth Fund
Small Cap Stock Fund
Stock Selector
Trend Fund
Value Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
