THE
N
C
ORTH
AROLINA
CAPITAL MANAGEMENT TRUST
CASH PORTFOLIO
TERM PORTFOLIO
SEMIANNUAL REPORT
DECEMBER 31, 1995
NCCMT-SANN-0296
8433
CHECK PAGE NUMBERS !!!
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST:
CASH PORTFOLIO:
PERFORMANCE 3 How the fund has done over time.
FUND TALK 5 The manager's review of the fund's performance,
strategy, and outlook.
INVESTMENTS 6 A complete list of the fund's investments with their
market values.
FINANCIAL STATEMENTS 9 Statements of assets and liabilities, operations,
and changes in net assets, as well as financial
highlights.
TERM PORTFOLIO:
PERFORMANCE 13 How the fund has done over time.
FUND TALK 16 The manager's review of the fund's performance,
strategy, and outlook.
INVESTMENTS 17 A complete list of the fund's investments with their
market values.
FINANCIAL STATEMENTS 18 Statements of assets and liabilities, operations,
and changes in net assets, as well as financial
highlights.
NOTES 22 Notes to the financial statements.
</TABLE>
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL INFORMATION OF THE SHAREHOLDERS OF THE
FUNDS. THIS REPORT IS NOT AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE
INVESTORS IN THE FUNDS UNLESS PRECEDED OR ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION.
SHARES ARE NOT INSURED BY THE FDIC, FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION NOR STERLING
CAPITAL DISTRIBUTORS, INC. IS A BANK.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - CASH PORTFOLIO
PERFORMANCE: THE BOTTOM LINE
To measure a money market fund's performance, you can look at either total
return or yield. Total return reflects the change in a fund's share price
over a given period, and reinvestment of its dividends (or income). Yield
measures the income paid by a fund. Since a money market fund tries to
maintain a $1 share price, yield is an important measure of performance. If
Fidelity had not reimbursed certain expenses, the past five and 10 year
total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 6 PAST 1 PAST 5 PAST 10
MONTHS YEAR YEARS YEARS
Cash Portfolio 2.80% 5.74% 24.15% 78.91%
Average All Taxable Money Market Fund 2.67% 5.49% 22.78% 73.38%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years or ten
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. To
measure how the fund's performance stacked up against its peers, you can
compare it to the average all taxable money market fund, which reflects the
performance of 395 taxable money market funds with similar objectives
tracked by IBC/Donoghue over the past six months. Recent U.S. Consumer
Price Index information is not available from the U.S. Department of Labor.
Therefore, the CPI comparison has not been included in this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Cash Portfolio 5.74% 4.42% 5.99%
Average All Taxable Money Market Fund 5.49% 4.19% 5.67%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
12/27/94 3/28/95 6/27/95 10/3/95 1/2/96
5.54% 5.79% 5.70% 5.44% 5.44%
Cash Portfolio
Average All Taxable 5.12% 5.53% 5.46% 5.29% 5.15%
Money Market Fund
12/28/94 3/29/95 6/28/95 9/27/95 12/27/95
2.74% 2.89% 2.87% 2.86% 2.83%
MMDA
Row: 1, Col: 1, Value: 5.54
Row: 1, Col: 2, Value: 5.119999999999999
Row: 1, Col: 3, Value: 2.74
Row: 2, Col: 1, Value: 5.79
Row: 2, Col: 2, Value: 5.53
Row: 2, Col: 3, Value: 2.89
Row: 3, Col: 1, Value: 5.7
Row: 3, Col: 2, Value: 5.46
Row: 3, Col: 3, Value: 2.87
Row: 4, Col: 1, Value: 5.44
Row: 4, Col: 2, Value: 5.29
Row: 4, Col: 3, Value: 2.86
Row: 5, Col: 1, Value: 5.44
Row: 5, Col: 2, Value: 5.149999999999999
Row: 5, Col: 3, Value: 2.83
Cash Portfolio
Average All Taxable
Money Market Fund
MMDA
6% -
5% -
4% -
3% -
2% -
1% -
0%
YIELD refers to the income paid by the fund over a given period. Yields for
money market funds are usually for seven-day periods, expressed as annual
percentage rates. A yield that assumes income earned is reinvested or
compounded is called an effective yield. The chart above shows the fund's
current seven-day yield at quarterly intervals over the past year. You can
compare these yields to the average all taxable money market fund and the
average bank money market deposit account (MMDA). Figures for the average
all taxable money market fund
are from IBC/Donoghue. The MMDA average is supplied by BANK RATE
MONITOR.(Trademark)
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS
WILL VARY, AND REFLECT PAST RESULTS RATHER THAN
PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
There are some important differences between
a bank money market deposit account (MMDA)
and a money market fund. First, the U.S.
government neither insures nor guarantees a
money market fund. In fact, there is no
assurance that a money market fund will
maintain a $1 share price. Second, a money
market fund returns to its shareholders income
earned by the fund's investments after
expenses. This is in contrast to banks, which
set their MMDA rates periodically based on
current interest rates, competitors' rates, and
internal criteria.
(checkmark)
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - CASH PORTFOLIO
FUND TALK: THE MANAGER'S OVERVIEW
An Interview with
Burnell Stehman:
Portfolio Manager
of The
North Carolina
Capital
Management
Trust:
Cash Portfolio
Q. HOW DID THE FUND PERFORM, BURNIE?
A. The fund's seven-day yield on December 31, 1995, was 5.44%, compared to
5.56% a year ago. For the six-month period ended December 31, 1995, the
fund's total return was 2.80%. For comparison purposes, the average
all-taxable money market fund returned 2.67%, according to IBC/Donoghue.
Q. WERE THERE ANY MAJOR DEVELOPMENTS IN MONETARY POLICY AND THE ECONOMY IN
THE LAST SIX MONTHS?
A. Definitely. The Federal Reserve Board lowered its target for the federal
funds rate - the rate banks charge each other on overnight loans - from 6%
to 5.75% in July. This was the first cut in almost three years and
confirmed a shift into a more neutral stance from the previous period of
restrictive policy. Economic activity gave off mixed signals during the
third quarter and into the fourth quarter. However, there was an underlying
tone of weakness, punctuated by continually subdued inflation. As we neared
the end of the year, investors' focus shifted away from economic
fundamentals and toward politics and the deficit reduction package
negotiations. Despite the lack of an agreement, which the market believed
could forestall another Fed easing, the Fed did lower the fed funds rate
another 0.25% to 5.50% in December. In lowering short-term rates, the Fed
essentially ignored politics and reacted solely to declining inflationary
pressures.
Q. HOW DID YOU POSITION THE FUND IN THIS ENVIRONMENT?
A. Given our interest-rate forecast, my strategy dictated that I maintain
the fund's average maturity in the 45 to 50 day range. This was
accomplished through the purchase of higher yielding, longer maturity
securities. At the same time, I maintained a partial position in
shorter-term paper for liquidity purposes.
Q. SIX MONTHS AGO, THE FUND HAD AN APPROXIMATELY 82% POSITION IN COMMERCIAL
PAPER. WHY HAS THE FUND'S EXPOSURE TO COMMERCIAL PAPER GONE DOWN TO ABOUT
65%?
A. Supply from issuers of corporate debt is not always available to
coincide with implementation of our investment strategy. Therefore, in
order to maintain the fund's average maturity, I turned to increasing the
fund's holdings in federal agency securities, which are usually in abundant
supply across the yield curve. Unfortunately, there is a sacrifice in
return versus the higher yielding commercial paper.
Q. WHAT'S YOUR OUTLOOK?
A. Near-term, the odds currently favor an additional Fed ease in rates.
However, markets could remain nervous and volatile as budget negotiations
and other economic events unfold. In the interim, I plan to maintain the
current maturity structure of the portfolio by taking advantage of buying
opportunities as they present themselves. Looking further ahead, I plan to
lean toward caution and build up liquidity in the portfolio as economic and
political issues unfold in this election year.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: Cash Portfolio seeks to obtain as high a
level of current income as is consistent with the
preservation of capital and liquidity, and to
maintain a constant net asset value per share of
$1.00
START DATE: September 2, 1982
SIZE: as of December 31, 1995, more than
$1.8 billion
MANAGER: Burnell Stehman, since 1984;
manager, Fidelity Money Market Trust - Rated
Money Market, formerly Domestic, since 1992;
Fidelity Institutional Cash Portfolio - Domestic,
since 1991; Fidelity Daily Income Trust, since
1986; joined Fidelity in 1979
(checkmark)
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - CASH PORTFOLIO
INVESTMENTS DECEMBER 31, 1995 (UNAUDITED)
Showing Percentage of Total Value of Investments
BANKERS' ACCEPTANCES - 1.4%
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
NationsBank Corp.
1/8/96 5.88% $ 2,000,000 $ 1,997,725
NationsBank of Georgia
1/3/96 5.80 3,100,000 3,099,010
1/22/96 5.79 2,200,000 2,192,647
1/29/96 5.78 5,000,000 4,977,717
2/5/96 5.76 2,000,000 1,988,955
NationsBank of Texas
1/16/96 5.79 5,000,000 4,988,062
2/26/96 5.81 1,000,000 991,211
3/11/96 5.73 2,057,464 2,034,980
Republic National Bank, NY
3/5/96 5.70 4,000,000 3,960,533
TOTAL BANKERS' ACCEPTANCES 26,230,840
COMMERCIAL PAPER (DAGGER) - 65.5%
AT&T Capital Corp.
2/2/96 5.77 5,000,000 4,974,666
3/1/96 5.63 25,000,000 24,767,917
American Express Credit Corp.
3/6/96 5.65 10,000,000 9,899,431
3/12/96 5.74 1,000,000 988,897
3/14/96 5.72 3,000,000 2,965,873
4/24/96 5.51 9,000,000 8,845,816
American General Finance Corp.
1/19/96 5.81 10,000,000 9,971,100
American Telephone & Telegraph
1/10/96 5.72 2,000,000 1,997,195
2/26/96 5.58 15,000,000 14,871,200
3/13/96 5.66 11,300,000 11,174,344
Asset Securitization Cooperative Corporation
2/15/96 5.74 5,000,000 4,964,562
Associates Corp. of North America
3/4/96 5.66 10,000,000 9,902,350
3/12/96 5.72 17,000,000 16,811,909
4/11/96 5.64 3,000,000 2,953,456
Banc One Corp.
1/5/96 5.78 5,000,000 4,996,805
Bank of New York Company, Inc.
1/26/96 5.80 10,000,000 9,960,139
Bear Stearns Cos., Inc.
3/27/96 5.58 20,000,000 19,737,222
BellAtlantic Financial Services
1/18/96 5.88 7,775,000 7,753,522
COMMERCIAL PAPER (DAGGER) - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
Beneficial Corp.
1/25/96 5.84% $ 15,000,000 $ 14,942,000
2/12/96 5.86 10,000,000 9,932,333
4/1/96 5.65 5,000,000 4,929,854
4/17/96 5.56 4,000,000 3,935,086
CIESCO, L.P.
1/10/96 5.75 5,000,000 4,992,875
1/11/96 5.76 10,000,000 9,984,222
1/12/96 5.76 10,000,000 9,982,644
1/24/96 5.76 20,000,000 19,927,166
1/26/96 5.79 14,370,000 14,313,019
2/6/96 5.76 12,400,000 12,329,692
2/9/96 5.77 3,745,000 3,721,996
CIT Group Holdings, Inc.
1/17/96 5.75 10,000,000 9,974,667
2/16/96 5.77 23,000,000 22,832,483
3/22/96 5.55 10,200,000 10,074,463
Chemical Banking Corp.
3/15/96 5.69 6,000,000 5,930,934
3/19/96 5.67 3,000,000 2,963,730
Clorox Co. (The)
2/16/96 5.74 5,000,000 4,963,839
Corporate Asset Funding Co., Inc.
1/11/96 5.75 9,900,000 9,884,270
1/12/96 5.75 10,000,000 9,982,522
1/30/96 5.76 15,000,000 14,931,366
2/1/96 5.62 30,000,000 29,855,850
2/8/96 5.76 5,000,000 4,970,076
3/7/96 5.72 10,000,000 9,896,876
Dean Witter, Discover & Co.
1/31/96 5.78 3,762,000 3,744,193
2/16/96 5.78 10,000,000 9,927,294
Delaware Funding Corporation
1/26/96 5.75 15,000,000 14,940,625
du Pont (E.I.) de Nemours & Co.
1/16/96 5.83 5,500,000 5,486,708
4/23/96 5.74 10,000,000 9,825,164
Electronic Data Systems
1/11/96 5.78 9,000,000 8,985,750
Enterprise Funding Corp.
1/22/96 5.88 6,253,000 6,231,662
2/20/96 5.80 10,000,000 9,920,278
Fleet Funding Corporation
2/5/96 5.66 5,000,000 4,972,680
Ford Motor Credit Corp.
1/9/96 5.75 10,000,000 9,987,334
1/9/96 5.78 20,000,000 19,974,666
1/10/96 5.75 5,000,000 4,992,875
1/18/96 5.78 15,000,000 14,959,625
2/13/96 5.77 15,000,000 14,898,592
3/22/96 5.54 10,000,000 9,877,150
COMMERCIAL PAPER (DAGGER) - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
General Electric Capital Corp.
1/17/96 5.82% $ 9,000,000 $ 8,977,280
3/1/96 5.77 15,000,000 14,859,000
3/11/96 5.63 20,000,000 19,784,167
3/28/96 5.80 10,000,000 9,863,700
4/1/96 5.71 11,000,000 10,844,289
4/24/96 5.76 5,000,000 4,911,333
General Electric Capital Services Inc.
4/29/96 5.73 6,000,000 5,889,529
Georgia Power Co.
2/9/96 5.73 11,000,000 10,932,432
Goldman Sachs Group, L.P. (The)
1/11/96 6.07 28,000,000 27,952,944
3/18/96 5.75 19,000,000 18,770,390
Household Finance Corp.
2/12/96 5.76 6,000,000 5,960,240
John Deere Capital Corp.
2/27/96 5.80 5,000,000 4,954,954
4/26/96 5.73 5,000,000 4,910,261
Lilly (Eli) & Co.
2/20/96 5.76 12,500,000 12,401,042
3/25/96 5.68 20,000,000 19,740,067
MCI Communications Corp.
3/25/96 5.58 12,000,000 11,846,000
Merrill Lynch & Co., Inc.
3/8/96 5.76 3,000,000 2,968,733
3/29/96 5.83 16,600,000 16,369,925
Monsanto Co.
1/31/96 5.66 8,489,000 8,449,243
Morgan Stanley Group, Inc.
1/2/96 6.08 15,000,000 14,997,467
1/5/96 5.92 25,000,000 24,983,611
3/27/96 5.58 29,000,000 28,618,972
Morgan (J.P.) & Co.
1/8/96 5.80 10,150,000 10,138,612
1/31/96 5.78 1,000,000 995,250
National Rural Util. Coop. Fin. Corp.
2/13/96 5.73 25,000,000 24,831,284
3/6/96 5.57 5,000,000 4,950,347
NationsBank Corp.
2/5/96 5.72 10,000,000 9,945,166
New Center Asset Trust
1/19/96 5.78 10,000,000 9,971,400
2/7/96 5.78 10,000,000 9,941,417
Norfolk Southern Corp.
1/26/96 5.78 5,000,000 4,980,208
PHH Corp.
1/5/96 5.80 9,735,000 9,728,759
1/8/96 5.80 30,000,000 29,966,342
1/19/96 5.74 11,255,000 11,223,008
1/19/96 5.77 2,036,000 2,030,218
1/23/96 5.84 5,000,000 4,982,277
1/26/96 5.80 1,870,000 1,862,585
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
Penney (JC) Funding Corp.
2/22/96 5.74% $ 45,000,000 $ 44,632,750
Pepsico
1/19/96 5.77 4,500,000 4,487,198
Philip Morris Cos., Inc.
1/9/96 5.81 3,000,000 2,996,134
Preferred Receivables Funding Corp.
1/4/96 5.83 10,000,000 9,995,167
1/22/96 5.80 5,000,000 4,983,287
1/24/96 5.84 20,000,000 19,925,889
1/25/96 5.84 1,150,000 1,145,554
2/2/96 5.89 1,150,000 1,144,020
2/13/96 5.69 3,255,000 3,233,033
2/28/96 5.71 7,000,000 6,936,280
SYSCO Corp.
1/16/96 5.76 5,000,000 4,988,125
1/19/96 5.77 10,000,000 9,971,500
Smith Barney, Inc.
1/29/96 5.79 3,000,000 2,986,653
Student Loan Corporation
3/1/96 5.71 15,000,000 14,859,250
Transamerica Financial Corp.
1/10/96 5.76 17,116,000 17,091,567
1/12/96 5.82 4,900,000 4,891,346
1/16/96 5.82 17,000,000 16,959,271
U.S.L. Capital, Inc.
1/8/96 5.77 10,000,000 9,988,878
2/9/96 5.75 10,915,000 10,847,837
2/13/96 5.77 20,000,000 19,863,595
2/16/96 5.81 7,889,000 7,831,038
TOTAL COMMERCIAL PAPER 1,205,803,787
FEDERAL AGENCIES - 25.7%
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 1.5%
2/21/96 5.62 5,855,000 5,808,965
2/22/96 5.65 10,000,000 9,920,555
3/4/96 5.43 8,000,000 7,924,820
3/5/96 5.43 4,750,000 4,704,653
28,358,993
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 5.1%
2/9/96 5.65 25,000,000 24,850,906
2/15/96 5.63 15,000,000 14,896,125
2/26/96 5.65 35,000,000 34,700,556
2/27/96 5.63 5,000,000 4,956,062
2/28/96 5.65 15,000,000 14,865,440
94,269,089
FEDERAL AGENCIES - CONTINUED
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 7.6%
2/5/96 5.61% $ 24,304,000 $ 24,173,568
2/5/96 5.62 9,315,000 9,264,738
2/5/96 5.66 9,000,000 8,951,087
2/6/96 5.64 15,000,000 14,916,600
2/7/96 5.64 12,000,000 11,931,427
2/12/96 5.63 30,330,000 30,133,613
2/20/96 5.62 5,000,000 4,961,458
2/29/96 5.63 25,000,000 24,772,604
3/1/96 5.57 6,501,000 6,441,408
3/6/96 5.58 4,000,000 3,960,278
139,506,781
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 11.5%
2/7/96 5.64 25,000,000 24,857,653
2/12/96 5.64 25,000,000 24,838,417
2/14/96 5.62 10,000,000 9,932,534
2/16/96 5.63 24,765,000 24,589,691
2/16/96 5.65 7,400,000 7,347,427
2/21/96 5.62 25,000,000 24,803,438
2/23/96 5.65 5,000,000 4,959,146
2/28/96 5.66 22,500,000 22,300,625
3/4/96 5.59 20,000,000 19,807,150
3/8/96 5.59 10,000,000 9,897,453
3/12/96 5.47 39,545,000 39,123,846
212,457,380
TOTAL FEDERAL AGENCIES 474,592,243
REPURCHASE AGREEMENTS - 7.4%
MATURITY
AMOUNT
In a joint trading account
(U.S. Treasury Obligations)
dated 12/29/95 due 1/2/96:
At 5.94% $ 135,689,546 135,600,000
TOTAL INVESTMENTS - 100% $ 1,842,226,870
Total Cost for Income Tax Purposes $ 1,842,226,870
LEGEND
(dagger) Cash Portfolio only purchases commercial paper with the highest
possible rating from at least one nationally recognized rating service. A
substantial portion of Cash Portfolio's investments are in commercial paper
of banks, finance companies and companies in the securities industry.
INCOME TAX INFORMATION
At June 30, 1995, Cash Portfolio had a capital loss carryforward of
approximately $54,000 which will expire on June 30, 2002.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - CASH PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
DECEMBER 31, 1995 (UNAUDITED)
1.ASSETS 2. 3.
4.Investment in securities, at value (including repurchase agreements of $135,600,000) - See 5. $ 1,842,226,870
accompanying schedule
6.Cash 7. 30,677
8.Interest receivable 9. 67,159
10. 11.TOTAL ASSETS 12. 1,842,324,706
13.LIABILITIES 14. 15.
16.Distributions payable $ 1,067,247 17.
18.Accrued management fee 536,463 19.
20. 21.TOTAL LIABILITIES 22. 1,603,710
23.24.NET ASSETS 25. $ 1,840,720,996
26.Net Assets consist of: 27. 28.
29.Paid in capital 30. $ 1,840,752,992
31.Accumulated net realized gain (loss) on investments 32. (31,996)
33.34.NET ASSETS, for 1,840,752,992 shares outstanding 35. $ 1,840,720,996
36.37.NET ASSET VALUE, offering price and redemption price per share 38. $1.00
($1,840,720,996 (divided by) 1,840,752,992 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED DECEMBER 31, 1995 (UNAUDITED)
39.40.INTEREST INCOME 41. $ 49,660,604
42.EXPENSES 43. 44.
45.Management fee $ 3,137,368 46.
Non-interested tustees' compensation 43,940
47. 48.TOTAL EXPENSES 49. 3,181,308
50.51.NET INTEREST INCOME 52. 46,479,296
53.54.NET REALIZED GAIN (LOSS) ON INVESTMENTS 55. 148
56.57.NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 58. $ 46,479,444
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR
ENDED ENDED
DECEMBER 31, 199 JUNE 30,
5 1995
(UNAUDITED)
59.INCREASE (DECREASE) IN NET ASSETS
60.Operations $ 46,479,296 $ 75,888,233
Net interest income
61. Net realized gain (loss) 148 49,400
62. 63.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 46,479,444 75,937,633
64.Distributions to shareholders from net interest income (46,479,296) (75,888,233)
65.Share transactions at net asset value of $1.00 per share 3,093,647,937 5,637,903,067
Proceeds from sales of shares
66. Reinvestment of distributions from net interest income 40,560,890 67,002,434
67. Cost of shares redeemed (2,882,589,045) (5,337,300,557)
68.69. 251,619,782 367,604,944
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS
70. 71.TOTAL INCREASE (DECREASE) IN NET ASSETS 251,619,930 367,654,344
72.NET ASSETS 73. 74.
75. Beginning of period 1,589,101,066 1,221,446,722
76. End of period $ 1,840,720,996 $ 1,589,101,066
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED JUNE 30,
ENDED
DECEMBER 31, 199
5
(UNAUDITED) 1995 1994 1993 1992 1991
77.SELECTED PER-SHARE DATA
78.Net asset value,
beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
79.Income from
Investment Operations .028 .052 .031 .030 .046 .070
Net interest income
80.Less Distributions (.028) (.052) (.031) (.030) (.046) (.070)
From net interest income
81.Net asset value,
end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
82.TOTAL RETURN B 2.80% 5.28% 3.10% 3.04% 4.67% 7.23%
C
83.RATIOS AND SUPPLEMENTAL DATA
84.Net assets, end of
period (000 omitted) $ 1,840,721 $ 1,589,101 $ 1,221,447 $ 1,303,118 $ 1,651,078 $ 1,405,579
85.Ratio of expenses
to average net .38% .39% .39% .39% .39% .40%
assets A D
86.Ratio of net
interest income to 5.50% 5.22% 3.05% 3.00% 4.47% 6.90%
average A
net assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD.
D FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - TERM PORTFOLIO
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each figure
includes changes in a fund's share price, plus reinvestment of any
dividends (or income) and capital gains (the profits the fund earns when it
sells bonds that have grown in value). You can also look at the fund's
income to measure performance. If Fidelity had not reimbursed certain
expenses, the past 5 years and life of fund total returns would have been
lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 6 PAST 1 PAST 5 LIFE OF
MONTHS YEAR YEARS FUND
Term Portfolio 3.08% 7.14% 28.65% 71.01%
Salomon Brothers 12-Month T-Bill Index 3.21% 8.09% 31.31% n/a
Average Short U.S. Government Bond Fund 4.17% 11.25% 37.81% n/a
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years, or
since the fund started on March 19, 1987. 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 Salomon Brothers 12-Month T-Bill Index - a broad measure
of the performance of short-term treasury bills. To measure how the fund's
performance stacked up against its peers, you can compare it to the average
short U. S. government bond fund, which reflects the performance of 143
funds with similar objectives tracked by Lipper Analytical Services over
the past six months. These benchmarks include reinvested dividends and
capital gains, if any. Recent U.S. Consumer Price Index information is not
available from the U.S. Department of Labor. Therefore, the CPI comparison
has not been included in this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Term Portfolio 7.14% 5.17% 6.29%
Salomon Brothers 12-Month T-Bill Index 8.09% 5.60% n/a
Average Short U.S. Government Bond Fund 11.25% 6.61% n/a
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 LIFE OF FUND
$17,454
$17,065
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in North
Carolina Term Portfolio on March 31, 1987, shortly after the fund started.
As the chart shows, by December 31, 1995, the value of your investment
would have grown to $17,065 a 70.65% increase on your initial investment.
For comparison, look at how the Salomon Brothers 12-Month Treasury Bill
Index did over the same period. With dividends reinvested, the same $10,000
investment would have grown to $17,454 a 74.54% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is no guarantee of
how it will do tomorrow. Bond prices, for
example, generally move in the opposite
direction of interest rates. In turn, the share
price, return, and yield of a fund that invests in
bonds will vary. That means if you sell your
shares during a market downturn, you might
lose money. But if you can ride out the
market's ups and downs, you may have a gain.
(checkmark)
TOTAL RETURN COMPONENTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SIX MONTHS
ENDED
DECEMBER 3 YEARS ENDED JUNE 30,
1,
1995 1995 1994 1993 1992 1991
Dividend return 2.78% 5.26% 3.17% 3.48% 5.94% 7.91%
Capital appreciation return 0.30% 0.61% -0.70% 0.30% 0.92% 0.92%
Total return 3.08% 5.87% 2.47% 3.78% 6.86% 8.83%
</TABLE>
DIVIDEND returns and capital appreciation returns are both part of a bond
fund's total return. A dividend return reflects the actual dividends paid
by the fund. A capital appreciation return reflects both the amount paid by
the fund to shareholders as capital gain distributions and changes in the
fund's share price. Both returns assume the dividends or gains are
reinvested.
DIVIDENDS AND YIELD
PERIODS ENDED DECEMBER 31, 1995 PAST PAST 6 PAST
MONTH MONTHS 1 YEAR
Dividends per share 4.68(cents) 27.11(cents) 55.39(cents)
Annualized dividend rate 5.55% 5.43% 5.60%
30-day annualized yield 5.02% - -
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $9.93 over
the past month, $9.91 over the past six months and $9.89 over the past
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all
funds based on the yields of the bonds in the fund, averaged over the past
30 days. This figure shows you the yield characteristics of the fund's
investments at the end of the period. It also helps you compare funds from
different companies on an equal basis.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - TERM PORTFOLIO
FUND TALK: THE MANAGER'S OVERVIEW
An Interview with
Curtis Hollingswort
h:
Portfolio Manager
of The
North Carolina
Capital
Management
Trust:
Term Portfolio
Note to shareholders: On October 1, 1995,
Curtis Hollingsworth became portfolio manager of
The North Carolina Capital Management Trust:
Term Portfolio, replacing Robert Duby.
Q. HOW DID THE FUND PERFORM, CURT?
A. For the six-month period ended December 31, 1995, the fund returned
3.08%. For comparison purposes, the Salomon Brothers One Year Treasury Bill
Index returned 3.21% for the same period.
Q. WHAT WERE SOME MAJOR MARKET DEVELOPMENTS IN THE LAST SIX MONTHS?
A. The Federal Reserve Board lowered its target for the federal funds rate
- - the rate banks charge each other on overnight loans - from 6% to 5.75% in
July. By the fourth quarter, investors turned their attention to politics
as the financial markets worried about whether the Washington budget
stalemate would forestall another Fed easing of short-term rates. In
December, despite the lack of a budget agreement, the Fed lowered the fed
funds rate another 0.25% to 5.50%.
Q. WHAT DOES "TARGETED ACTIVE MANAGEMENT" - OR MANAGING THE FUND'S INTEREST
RATE SENSITIVITY TO BE SIMILAR TO THAT OF ITS BENCHMARK INDEX - MEAN TO
YOU?
A. I think of targeted active management as a four-part process: duration -
or interest-rate sensitivity - management, maturity distribution, sector
weighting and security selection. I moved the fund's maturity distribution
closer to that of the benchmark index. When I took over, the fund had a
more barbelled position of three to six-month and two-year maturities.
Historically, I've noticed that, in a falling interest rate environment,
it's better to have a more bulleted strategy than a barbell. As it turned
out, the solid performance of the one- year Treasury bill helped the fund's
total return.
Q. WHAT OTHER CHANGES DID YOU MAKE?
A. I improved the credit quality of the portfolio by emphasizing U.S.
Treasury securities. From a risk/reward standpoint, the yield spread
between U.S. Treasuries and U.S. Government agency securities was not
attractive enough to warrant a shift to agency paper. Additionally, in
terms of security selection, I targeted slightly undervalued U.S. Treasury
securities around the fund's one-year target maturity.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. Because of the solid performance of fixed-income instruments in 1995, it
was difficult to find cheap, yield-advantaged securities.
Q. WHAT'S YOUR OUTLOOK?
A. While the yield curve is currently very flat, short-term rates are still
much higher than the inflation rate. Given that,
I am still optimistic about the bond market's prospects in 1996. However,
the markets could experience some volatility if economic growth is stronger
than expected.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: Term Portfolio seeks to obtain as high a
level of current income as is consistent with the
preservation of capital
START DATE: March 19, 1987
SIZE: as of December 31, 1995, more than
$60 million
MANAGER: Curtis Hollingsworth, since October
1995; manager, Spartan Short-Intermediate
Government Fund since 1992; Fidelity
Short-Intermediate Government Fund, since
1991; Spartan Limited Maturity Government
Fund, since 1988; Fidelity Institutional
Short-Intermediate Government Fund, since
1987; joined Fidelity in 1983
(checkmark)
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - TERM PORTFOLIO
INVESTMENTS DECEMBER 31, 1995 (UNAUDITED)
Showing Percentage of Total Value of Investments
U.S. TREASURY OBLIGATIONS - 95.5%
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
BILLS, YIELDS AT DATE OF PURCHASE - 56.1%
5.31%, 9/19/96 $ 33,400,000 $ 32,203,946
5.12%, 10/17/96 1,490,000 1,430,787
33,634,733
NOTES, YIELDS AT DATE OF PURCHASE - 39.4%
8.00%, 1/15/97 13,200,000 13,560,888
5.63%, 6/30/97 10,000,000 10,062,500
23,623,388
TOTAL U.S TREASURY OBLIGATIONS
(Cost $57,056,606) 57,258,121
REPURCHASE AGREEMENTS - 4.5%
MATURITY
AMOUNT
In a joint trading account
(U.S. Treasury Obligations)
dated 12/29/95 due 1/2/96:
At 5.88% $ 2,731,782 $ 2,730,000
TOTAL INVESTMENTS IN SECURITIES - 100%
(Cost $59,786,606) $ 59,988,121
INCOME TAX INFORMATION
At December 31, 1995, the aggregate cost of investment securities for
income tax purposes was $59,786,606. Net unrealized appreciation aggregated
$201,515, of which $201,515 related to appreciated investment securities
and $0 related to depreciated investment securities.
At June 30, 1995, the fund had a capital loss carryforward of approximately
$301,000 which will expire on June 30, 2003.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST - TERM PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
DECEMBER 31, 1995 (UNAUDITED)
87.ASSETS 88. 89.
90.Investment in securities, at value (including repurchase agreements of $2,730,000) (cost 91. $ 59,988,121
$59,786,606) - See accompanying schedule
92.Cash 93. 208,904
94.Interest receivable 95. 766,207
96. 97.TOTAL ASSETS 98. 60,963,232
99.LIABILITIES 100. 101.
102.Distributions payable $ 108,308 103.
104.Accrued management fee 18,389 105.
106. 107.TOTAL LIABILITIES 108. 126,697
109.110.NET ASSETS 111. $ 60,836,535
112.Net Assets consist of: 113. 114.
115.Paid in capital 116. $ 60,873,814
117.Distributions in excess of net investment income 118. (8,930)
119.Accumulated undistributed net realized gain (loss) on investments 120. (229,864)
121.Net unrealized appreciation (depreciation) on investments 122. 201,515
123.124.NET ASSETS, for 6,123,315 shares outstanding 125. $ 60,836,535
126.127.NET ASSET VALUE, offering price and redemption price per share ($60,836,535 (divided by)
6,123,315 128. $9.94
shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED DECEMBER 31, 1995 (UNAUDITED)
129.INVESTMENT INCOME 131. $ 1,896,398
130.Interest
132.EXPENSES 133. 134.
135.Management fee $ 126,561 136.
Non-interested trustees' compensation 1,679 137.
138. 139.TOTAL EXPENSES 140. 128,240
141.142.NET INVESTMENT INCOME 143. 1,768,158
144.REALIZED AND UNREALIZED GAIN (LOSS) 146. 70,990
145.Net realized gain (loss) on investment securities
147.Change in net unrealized appreciation (depreciation) on investment securities 148. 75,585
149.150.NET GAIN (LOSS) 151. 146,575
152.153.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 154. $ 1,914,733
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR
ENDED ENDED
DECEMBER 31, 199 JUNE 30,
5 1995
(UNAUDITED)
155.INCREASE (DECREASE) IN NET ASSETS
156.Operations $ 1,768,158 $ 3,347,525
Net investment income
157. Net realized gain (loss) 70,990 (82,924)
158. Change in net unrealized appreciation (depreciation) 75,585 494,133
159.160.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 1,914,733 3,758,734
161.Distributions to shareholders (1,771,409) (3,346,756)
from net investment income
162.Share transactions
163. Net proceeds from sales of shares 2,124,200 7,077,317
164. Reinvestment of distributions 1,198,022 2,267,207
165. Cost of shares redeemed (12,979,524) (5,900,951)
166.167.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (9,657,302) 3,443,573
168. 169.TOTAL INCREASE (DECREASE) IN NET ASSETS (9,513,978) 3,855,551
170.NET ASSETS 171. 172.
173. Beginning of period 70,350,513 66,494,962
174. $ 60,836,535 $ 70,350,513
End of period (including distributions in excess of net investment income of $8,930
and $5,679, respectively)
175.OTHER INFORMATION 177. 178.
176.Shares
179. Sold 214,303 717,405
180. Issued in reinvestment of distributions 120,860 229,823
181. Redeemed (1,310,008) (597,979)
182. Net increase (decrease) (974,845) 349,249
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED JUNE 30,
ENDED
DECEMBER 31, 199
5
(UNAUDITED) 1995 1994 1993 1992 1991
183.SELECTED PER-SHARE DATA
184.Net asset value,
beginning of period $ 9.910 $ 9.850 $ 9.940 $ 9.910 $ 9.820 $ 9.730
185.Income from Investment
Operations .271 .505 .288 .337 .560 .741
Net investment income
186. Net realized and unrealized
gain (loss) .030 .059 (.046) .031 .097 .090
187. Total from investment
operations .301 .564 .242 .368 .657 .831
188.Less Distributions (.271) (.504) (.312) (.338) (.567) (.741)
From net investment income
189. In excess of net realized gain - - (.020) - - -
190. Total distributions (.271) (.504) (.332) (.338) (.567) (.741)
191.Net asset value, end of period $ 9.940 $ 9.910 $ 9.850 $ 9.940 $ 9.910 $ 9.820
192.TOTAL RETURN B 3.08% 5.87% 2.47% 3.78% 6.86% 8.83%
C
193.RATIOS AND SUPPLEMENTAL DATA
194.Net assets, end of period (000
omitted) $ 60,837 $ 70,351 $ 66,495 $ 79,765 $ 89,303 $ 83,656
195.Ratio of expenses to average net
assets .39%A .41% .41% .41% .41% .41%
D
196.Ratio of net investment income
to average 5.43%A 5.12% 3.14% 3.41% 5.69% 7.56%
net assets
197.Portfolio turnover rate 0% 519% 494% 612% 424% 78%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD.
D FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
NOTES TO FINANCIAL STATEMENTS
For the period ended December 31, 1995 (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES.
Cash Portfolio and Term Portfolio (the funds) are funds of The North
Carolina Capital Management Trust (the trust). The trust is registered
under the Investment Company Act of 1940, as amended (the 1940 Act), as an
open-end management investment company organized as a Massachusetts
business trust. Shares of the trust are offered exclusively to local
governments and public authorities of the State of North Carolina. Each
fund is authorized to issue an unlimited number of shares. The following
summarizes the significant accounting policies of the funds:
SECURITY VALUATION.
CASH PORTFOLIO. As permitted under Rule 2a-7 of the 1940 Act, and certain
conditions therein, securities are valued initially at cost and thereafter
assume a constant amortization to maturity of any discount or premium.
TERM PORTFOLIO. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days of their purchase date are valued either at
amortized cost or original cost plus accrued interest, both of which
approximate current value. Securities for which market quotations are not
readily available are valued at their fair value as determined in good
faith under consistently applied procedures under the general supervision
of the Board of Trustees.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, each fund is not subject to income taxes to
the extent that it distributes substantially all of its taxable income for
the fiscal year. The schedules of investments include information regarding
income taxes under the caption "Income Tax Information."
INVESTMENT INCOME.
CASH PORTFOLIO. Interest income, which includes amortization of premium and
accretion of discount, is accrued as earned.
TERM PORTFOLIO. Interest income, which includes accretion of discount, is
accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS.
CASH PORTFOLIO. Dividends are declared daily and paid monthly from net
interest income.
TERM PORTFOLIO. Distributions are declared daily and
paid monthly from net interest income. Distributions
to shareholders from realized gains on investments,
if any, are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for capital
loss carryforwards and losses deferred due to excise tax regulations. Term
Portfolio 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 the per-share allocation between net investment income and realized
and unrealized gain (loss). Undistributed net investment income and
accumulated undistributed net realized gain (loss) on investments may
include temporary book and tax basis differences which will reverse in a
subsequent period. Distributions in excess of net investment income and
accumulated undistributed net realized gain (loss) on investments may
include temporary book and tax basis differences that will reverse in a
subsequent period. Any taxable income or gain remaining at fiscal year end
is distributed in the following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), the funds, along with other
affiliated entities of Fidelity Management & Research Company (FMR), may
transfer uninvested cash balances into one or more joint trading accounts.
These balances are invested in one or more repurchase agreements 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 funds, through their custodian, receive delivery
of the underlying U.S. Treasury or Federal Agency securities, the market
value of which is required to be at least equal to the repurchase price.
For term repurchase agreement transactions, the underlying securities are
marked-to-market daily and maintained at a value at least equal to the
repurchase price. FMR, the funds' investment adviser, is responsible for
determining that the value of the underlying securities remains in
accordance with the market value requirements stated above.
3. PURCHASES AND SALES OF INVESTMENTS.
TERM PORTFOLIO. Purchases and sales of securities, other than short-term
securities, aggregated $70,979,906 and $0, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser,
FMR pays all expenses, except the compensation of the non-interested
Trustees and certain exceptions such as interest, taxes, brokerage
commissions and extraordinary expenses.
FMR receives a fee that is based upon a graduated series of rates ranging
from .38% to .41% of each fund's average net assets. Effective November 1,
1995, and until shareholders vote to approve a revised management fee
schedule, FMR has voluntarily agreed to implement a revised fee schedule
based on a graduated series of rates ranging from .33% to .365% of each
fund's average net assets. For the period, the management fees paid to FMR
were equivalent to an annualized rate of .37% and .39% for the Cash and
Term Portfolios, respectively.
SUB-ADVISER FEE. As Cash Portfolio's investment sub-adviser, FMR Texas
Inc., a wholly owned subsidiary of FMR, receives a fee from FMR of 50% of
the management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plans (the Plans), and in accordance with Rule 12b-1 of the 1940 Act, FMR
pays Fidelity Distributors Corporation (FDC), an affiliate of FMR, a
distribution and service fee that is based on a graduated series of rates
ranging from .14% to .17% of each fund's average net assets. For the
period, FMR paid FDC $1,369,973 and $45,346 on behalf of the Cash and the
Term Portfolios, respectively, all of which FDC paid to Sterling Capital
Distributors, Inc., a wholly-owned subsidiary of Sterling Capital
Management Company.
TRUSTEES
William L. Byrnes
John David "J.D." Foust
W. Olin Nisbet III
Helen A. Powers
Bertram H. Witham
OFFICERS
William L. Byrnes, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
W. Olin Nisbet III, VICE PRESIDENT
J. Calvin Rivers, Jr., VICE PRESIDENT
Curtis Hollingsworth, VICE PRESIDENT, TERM PORTFOLIO
Burnell R. Stehman, VICE PRESIDENT, CASH PORTFOLIO
Arthur S. Loring, SECRETARY
Kenneth A. Rathgeber, TREASURER
Thomas D. Maher, ASSISTANT VICE PRESIDENT, CASH PORTFOLIO
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
David H. Potel, ASSISTANT SECRETARY
DISTRIBUTION AGENT
Sterling Capital Distributors, Inc.
Charlotte, NC
CUSTODIAN
First Union National Bank of North Carolina
Charlotte, NC
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
SUB-ADVISER FOR CASH PORTFOLIO
FMR Texas, Inc.
Irving, TX
TRANSFER AGENT
Fidelity Investments Institutional Operations Company
Boston, MA
