FIDELITY
(registered trademark)
NEW MILLENNIUM(trademark)
FUND
SEMIANNUAL REPORT
MAY 31, 1994
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on stock market
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 9 A summary of major shifts in the
fund's investments over the past six
months.
INVESTMENTS 10 A complete list of the fund's
investments with their market
values.
FINANCIAL STATEMENTS 23 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 27 Notes to the financial statements.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. NEITHER THE FUND NOR FIDELITY DISTRIBUTORS
CORPORATION IS A
BANK, AND FUND SHARES ARE NOT BACKED OR GUARANTEED BY ANY BANK OR INSURED
BY THE
FDIC.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
The first few months of 1994 were an unsettling time for many investors.
After three years of a nearly perfect environment for stock market
investing, stock prices fell in March and April. Investors disagree about
whether this decline represents only a short-term correction or signals the
beginning of a longer bear market. One can collect statistics to support
either opinion, but of course, nobody knows for sure what will happen to
stock prices in the months ahead.
We do know, however, that market declines are a normal part of stock market
investing. We have historically seen corrections of 10% or more every two
years. That's why I thought this might be a good time to review three basic
investment principles that have proven helpful to successful stock market
investors in every market cycle.
First, take a long-term approach when investing in stocks and stock funds.
If you can afford to leave your money invested through the market's
inevitable ups and downs, you will greatly reduce your vulnerability to any
single decline. Over time, stock prices have gone up - and have
significantly outperformed other types of investments and stayed ahead of
inflation.
Second, you can further manage risk by diversifying your investments. A
stock mutual fund is already diversified, because it invests in many
different companies. You can increase your diversification by investing in
a number of different stock funds, or in different investment categories,
such as bonds. You should also keep money you'll need in the near future in
a more stable investment.
Finally, it makes good sense to follow a regular investment plan, investing
a set amount of money at the same time each month or quarter. That way, you
can avoid getting caught up in the excitement of a rapidly-rising market -
and won't end up buying all your shares at market highs. This strategy
won't assure a profit or protect you from a loss in a declining market, but
it should help you lower the average cost of your purchases. For this to be
effective, you must continue to buy shares in both up and down markets.
If you have questions, please call us at 1-800-544-8888. We would be happy
to send you a Fidelity FundMatch kit, which can help you determine the mix
of investments that is right for you. You might also find it convenient to
set up a regular investment plan using the Fidelity Automatic Account
Builder.
We look forward to hearing from 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 MAY 31, 1994 PAST 6 PAST 1 LIFE OF
MONTHS YEAR FUND
New Millennium -0.67% 5.32% 18.90%
New Millennium (incl. 3% sales charge) -3.65% 2.16% 15.34%
S&P 500(Registered trademark) 0.24% 4.26% 8.05%
Average Capital Appreciation Fund -0.91% 5.52% n/a
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, or since the fund
began on December 28, 1992. For example, if you invested $1,000 in a fund
that had a 5% return over the past year, you would end up with $1,050. You
can compare the fund's returns to the performance of the Standard &
Poor's 500 Composite Stock Price Index - a common proxy for the U.S. stock
market. You can compare these figures to the average capital appreciation
fund, which reflects the performance of 152 capital appreciation funds
tracked by Lipper Analytical Services. Both benchmarks include reinvested
dividends and capital gains, if any, and exclude the effects of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MAY 31, 1994 PAST 1 LIFE OF
YEAR FUND
New Millennium 5.32% 12.92%
New Millennium (incl. 3% sales charge) 2.16% 10.53%
S&P 500(Registered trademark) 4.26% 5.58%
Average Capital Appreciation Fund 5.52% 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
New Millennium (300) S&P 500
12/28/92 9700.00 10000.00
12/31/92 9777.60 9910.45
01/31/93 10291.70 9993.70
02/28/93 10029.80 10129.62
03/31/93 10437.20 10343.35
04/30/93 10340.20 10093.04
05/31/93 10951.30 10363.53
06/30/93 11038.60 10393.59
07/31/93 11242.30 10352.01
08/31/93 11620.60 10744.36
09/30/93 11892.20 10661.62
10/31/93 12105.60 10882.32
11/30/93 11610.90 10778.94
12/31/93 12189.94 10909.36
01/31/94 12418.53 11280.28
02/28/94 12448.36 10974.59
03/31/94 11682.77 10496.09
04/30/94 11613.17 10630.44
05/31/94 11533.62 10804.78
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Fidelity New
Millennium Fund on December 28, 1992, and paid a 3% sales charge. As the
chart shows, by May 31, 1994, the value of your investment would have grown
to $11,534 - a 15.34% 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 $10,805 - a
8.05% 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
An interview with Neal Miller,
Portfolio Manager of Fidelity
New Millennium Fund
Q. HOW DID THE FUND PERFORM, NEAL?
A. Not as well as I would have liked. For the six months and one year ended
May 31, 1994, the fund had total returns of -0.67% and 5.32%, respectively.
This compares with the average capital appreciation fund, which returned
- - -0.91% over the six months and 5.52% over the year, according to Lipper
Analytical Services.
Q. WHAT HURT THE FUND?
A. The negative interest rate environment - where interest rates were
increasing dramatically - discriminated against my type of investing. I try
to discover stocks that are out of favor but have something currently in
the works that will make them overachievers, or top-performing investments,
going forward. However, when interest rates go up, investors would rather
own stock in a company that's turning in good results now, instead of one
that has strong growth prospects.
Q. YOU MENTIONED YOUR TYPE OF INVESTING. CAN YOU EXPLAIN THIS MORE?
A. Yes. The fund tends to choose stocks based on social and economic trends
that indicate the direction the market might take in the future. I like to
say it tries to show people tomorrow's newspaper today. I look for counter
trends or anomalies that indicate the beginning of a trend, then invest in
stocks that are well placed to benefit from this favorable market backdrop.
My goal is to find companies at bargain prices that have growth-oriented
management, and companies whose products are already well received in the
marketplace. Here's an example of how I pick stocks: I read in RAILWAY AGE,
a trade periodical, that legislation to make railroad crossings safer was
pending. The publication highlighted Harmon Industries as the leader in
railroad crossing equipment. In response - after our research department
saw that the company had a strong earnings forcast - I bought Harmon stock.
Q. SO, OVER THE PAST SIX MONTHS, WHAT TRENDS HAVE EMERGED?
A. There were many trends, but several of them stand out. The first is what
I call "pleasure revenge." After two back-to-back recessions, layoffs in
the workplace, and a fashion environment that favored the color black, it
started to look like things were finally turning around. As the economy was
recovering, people were coming out of their cocoons and were increasingly
interested in pleasure items, such as travel. A second trend was the
increased interest in technology in an office environment, especially
networking and distributed data processing companies. I've tried to benefit
from this trend through the database company Oracle Systems Corp. and the
data storage company EMC Corp., both of which are in the fund's top 10
stocks.
Q. HOW HAS THE "PLEASURE REVENGE" YOU MENTIONED AFFECTED THE STOCKS THAT
YOU'VE BEEN BUYING?
A. The fund owned mid- to upper-scale hotel companies, such as Hilton
Hotels, which benefited from this trend. I also liked gaming stocks;
clothing companies, such as Warnaco, which makes the highly publicized
"Miracle Bra;" and companies that produce sporting goods products. Boating
and outboard motor companies, like Brunswick Corp., also looked good.
Q. WERE THERE OTHER NOTABLE TRENDS?
A. Yes, as I indicated earlier, there was some interesting activity with
railroads. First, keep in mind that in 1980 there were 71 Class 1 rails, or
large railroad companies, in the United States. Now there are 13. The
survivors of the railroad downsizing are more in charge of their destiny.
They're cooperating with each other and operating their plant equipment
more efficiently. In addition, trains can now be powered by alternating
current, which makes them more fuel efficient. Because of these changes,
I'm investing in large railroads, like Illinois Central, over the long run.
I'm also focusing on related companies, such as Trinity Industries, which
makes railroad cars. However, this year railroad stocks, which are cyclical
stocks - those that tend to do well when the economy is doing well or
poorly when the economy is weak - did not turn in a strong performance.
This is because a number of investors did not believe that the industry
would have an opportunity to raise prices or that industry equipment
backlogs were real.
Q. ANY OTHER INDUSTRIES THAT WERE STANDOUTS?
A. Yes. The newsprint industry was worth noting because the real price of
newsprint is at a 20-year low and the domestic demand for it is very peppy.
However, what's especially encouraging is that the industry is doing well
despite new environmental emissions legislation that will cost it money.
Another thing that makes this industry look good is that the same machinery
used to produce newsprint can be used to make telephone books. Demand for
telephone books is growing in many developing countries, such as Malaysia
and Indonesia.
Q. IN HINDSIGHT, DO YOU REGRET ANY OF YOUR INVESTMENT DECISIONS?
A. My buying discipline is to buy low and sell high. I went against this
approach when I bought stocks in Southeast Asia after they'd already had a
significant run and were priced high. These investments helped the fund's
performance during 1993 when the region was turning in phenomenal results,
but weakened its performance when these markets fell in 1994. So, it was
pretty much a wash. Still, it could have turned out differently.
Q. WHAT DO YOU THINK SHAREHOLDERS CAN EXPECT OVER THE NEXT YEAR?
A. I'm fairly positive about the fund. It seems like the interest rate
environment is beginning to stabilize. That could be good news for the fund
since it means more investors may be willing to invest in stocks that look
good for the long term. I believe that in this environment the
overachieving companies that the fund favors may turn in solid
performances.
FUND FACTS
GOAL: to increase the value
of the fund's shares over the
long term by focusing on
stocks with growth potential
due to social and economic
changes
START DATE: December 28,
1992
SIZE: as of May 31, 1994,
more than $311 million in
assets (with current limit of
$500 million in assets)
MANAGER: Neal Miller, since
December 1992; manager,
Fidelity Equity Portfolios,
since November 1988;
Fidelity Aggressive Equity
Discipline, since June 1990;
Fidelity
Special Equity Discipline,
1988-1990; joined Fidelity
in 1988
(checkmark)
NEAL MILLER ON NEW
MILLENNIUM'S TOP TEN STOCKS:
"My largest holding is Herman
Miller, one of the country's
largest producers of office
furniture. This company is
benefiting from an excessive
amount of commercial real
estate and increased
competition among landlords
for business tenants. As a
result of this situation,
businesses are moving
between locations more, and
they're buying more furniture
from companies like Herman
Miller. Another company that
has impressed me is the hotel
chain La Quinta Motor Inns,
whose management has
taken a number of steps to
freshen its image.
"I was disappointed with IBM,
which I had high hopes for six
months ago. In general, from
the fund's perspective as a
growth investor, IBM no
longer meets the fund's
selection criteria."
(bullet) Over the past six months,
the fund switched some of its
foreign holdings away from
Southeast Asia and into
Canadian companies.
Canadian energy company
Chieftain International, which
has the majority of its energy
production capacity in the
United States, is the fund's
largest Canadian holding.
INVESTMENT CHANGES
TOP TEN STOCKS AS OF MAY 31, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO
Herman Miller, Inc. 3.7 3.8
La Quinta Motor Inns, Inc. 2.3 1.6
Diebold, Inc. 2.2 1.6
Trinity Industries, Inc. 1.8 2.0
Oracle Systems Corp. 1.6 -
Bowater, Inc. 1.5 -
Dell Computer Corporation 1.5 -
Compaq Computer Corp. 1.3 0.6
EMC Corp. 1.3 -
Hilton Hotels Corp. 1.2 -
TOP FIVE INDUSTRIES AS OF MAY 31, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE INDUSTRIES
6 MONTHS AGO
Technology 19.9 14.7
Media & Leisure 9.8 8.3
Durables 9.3 5.3
Transportation 8.0 10.4
Health 5.9 3.5
ASSET ALLOCATION
AS OF MAY 31, 1994 * AS OF NOVEMBER 30, 1993 **
Row: 1, Col: 1, Value: 6.6
Row: 1, Col: 2, Value: 50.0
Row: 1, Col: 3, Value: 43.4
Row: 1, Col: 1, Value: 11.4
Row: 1, Col: 2, Value: 40.0
Row: 1, Col: 3, Value: 48.6
Stocks 93.4%
Short-term
Investments 6.6%
FOREIGN
INVESTMENTS 12.2%
Stocks 88.6%
Short-term
Investments 11.4%
FOREIGN
INVESTMENTS 12.9%
*
**
INVESTMENTS MAY 31, 1994 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 93.3%
SHARES VALUE (NOTE 1)
BASIC INDUSTRIES - 5.8%
CHEMICALS & PLASTICS - 0.4%
Furon Co. 21,300 $ 330,150
Guardsman Products, Inc. 31,600 351,550
Quaker Chemical Corp. 7,600 136,800
Wellman, Inc. 21,300 543,150
1,361,650
IRON & STEEL - 0.6%
Birmingham Steel Corp. 23,700 740,625
Laclede Steel Co. (a) 51,800 738,150
Nucor Corp. 7,200 483,300
1,962,075
METALS & MINING - 0.7%
Brush Wellman, Inc. 2,400 42,900
Castle AM & Co. 84,300 1,728,150
Korea Tungsten Mining Co. (a) 8,888 348,506
2,119,556
PACKAGING & CONTAINERS - 0.3%
Shorewood Packaging Corp. (a) 56,100 925,650
PAPER & FOREST PRODUCTS - 3.8%
Abitibi-Price, Inc. (a) 246,500 3,009,361
Aokam Perdana BHD (a) 185,800 1,382,965
Bowater, Inc. 198,300 4,808,775
Domtar, Inc. (a) 13,800 68,638
Fletcher Challenge Canada Ltd. Class A 28,900 394,637
Kimberly Clark de Mexico Class A 42,800 898,001
Longview Fibre Co. 26,200 517,450
Stone Consolidated Corp. (a) 93,700 1,093,082
12,172,909
TOTAL BASIC INDUSTRIES 18,541,840
CONGLOMERATES - 0.8%
Alexander & Baldwin, Inc. 74,900 1,853,775
Harris Corp. 14,600 691,675
2,545,450
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
CONSTRUCTION & REAL ESTATE - 4.0%
BUILDING MATERIALS - 1.5%
Associated Kaolin Industries BHD 99,000 $ 291,685
Central Sprinkler Corp. (a) 20,000 235,000
Golden Pharos BHD (a) 100,000 317,891
Lilly Industrial Coatings, Inc. Class A 71,700 1,613,250
National Gypsum Co. (a) 32,800 1,148,000
Republic Gypsum Co. 26,200 294,750
Southdown, Inc. (a) 2,400 51,300
USG Corp. (a) 29,900 687,700
4,639,576
CONSTRUCTION - 1.8%
Butler Manufacturing Co. (Del.) (a) 109,300 2,377,275
NCI Building Systems, Inc. (a) 137,500 2,303,125
Renong BHD 358,000 441,342
Standard Pacific Corp. 69,100 613,263
5,735,005
ENGINEERING - 0.6%
Apogee Enterprises, Inc. 19,800 232,650
Foster Wheeler Corp. 3,000 112,875
Glenayre Technologies, Inc. 37,800 1,625,400
Stone & Webster, Inc. 1,000 33,250
2,004,175
REAL ESTATE - 0.1%
Grubb & Ellis Co. (a) 77,800 204,225
TOTAL CONSTRUCTION & REAL ESTATE 12,582,981
DURABLES - 9.3%
AUTOS, TIRES, & ACCESSORIES - 3.3%
CLARCOR, Inc. 44,100 793,800
Cooper Tire & Rubber Co. 6,100 161,650
Echlin, Inc. 103,000 2,793,875
Genuine Parts Company 85,400 2,978,325
Honda Motor Co. Ltd. 34,000 606,817
Raymond Corp. (The) (a) 109,465 1,970,370
Smith (A.O.) Corp. Class B 16,800 459,900
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
DURABLES - CONTINUED
AUTOS, TIRES, & ACCESSORIES - CONTINUED
Suzuki Motor Corp. 46,000 $ 610,086
Wabash National Corp. 1,900 90,250
10,465,073
CONSUMER ELECTRONICS - 1.2%
Harman International Industries, Inc. (a) 8,500 231,625
Matsushita Electric Industrial Co. Ltd. 115,000 2,002,513
Newell Co. 34,600 1,569,975
3,804,113
HOME FURNISHINGS - 3.9%
HON Industries, Inc. 25,600 734,400
Herman Miller, Inc. 478,000 11,711,000
12,445,400
TEXTILES & APPAREL - 0.9%
NIKE, Inc. Class B 19,700 1,162,300
Warnaco Group, Inc. Class A (a) 53,700 1,758,675
2,920,975
TOTAL DURABLES 29,635,561
ENERGY - 5.0%
COAL - 0.5%
MAPCO, Inc. 23,700 1,481,250
ENERGY SERVICES - 2.8%
Atwood Oceanics, Inc. (a) 4,500 57,938
BJ Services Co. (a) 57,800 1,083,750
Dreco Energy Services Ltd. Class A (a) 28,600 286,000
Dual Drilling Co. (a) 33,900 372,900
Global Marine, Inc. (a) 97,000 388,000
Marine Drilling Cos., Inc. (a) 120,000 570,000
Maverick Tube Corp. (a) 38,200 334,250
Nabors Industries, Inc. (a) 193,900 1,308,825
Petroleum Helicopters, Inc. (a) 4,100 39,975
Petroleum Helicopters, Inc. (non-vtg.) (a) 9,600 93,600
Pride Petroleum Services, Inc. (a) 30,000 151,875
Schlumberger Ltd. 34,300 1,963,675
Smith International, Inc. (a) 28,200 426,525
Weatherford International, Inc. (a) 169,200 1,797,750
8,875,063
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
ENERGY - CONTINUED
OIL & GAS - 1.7%
Apache Corp. 26,600 $ 721,525
Chieftain International, Inc. (a) 216,300 3,736,055
KCS Group, Inc. 12,800 268,800
Parker & Parsley Petroleum Co. 32,400 793,800
5,520,180
TOTAL ENERGY 15,876,493
FINANCE - 4.3%
BANKS - 0.9%
Bancorp Hawaii, Inc. 20,300 664,825
Development & Commercial Bank 313,000 649,178
First Hawaiian, Inc. 11,400 313,500
Michigan National Corp. 10,100 765,075
State Street Boston Corp. 8,500 344,781
2,737,359
CREDIT & OTHER FINANCE - 0.9%
Brierley Investments Ltd. 967,087 734,677
First USA, Inc. 4,900 217,438
Granite Industries BHD 131,000 233,611
Idris Hydraulic Malaysia BHD (a) 808,000 1,353,190
Tong Yang Securities Co. Ltd. (a) 11,628 249,615
2,788,531
INSURANCE - 0.2%
American Travellers Corp. (a) 30,500 392,688
Berkley (W.R.) Corp. 10,500 406,875
799,563
SAVINGS & LOANS - 0.1%
Washington Mutual Savings Bank 17,700 366,169
SECURITIES INDUSTRY - 2.2%
Daiwa Securities 70,000 1,200,333
Korea First Securities Co. (a) 47,940 1,017,216
Nikko Securities 125,000 1,645,914
Nomura Securities Co. Ltd. 97,000 2,239,778
Seoul Securities Co. (a) 25,584 479,363
Sunkyong Securities Co. (a) 20,000 419,407
7,002,011
TOTAL FINANCE 13,693,633
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
HEALTH - 5.9%
DRUGS & PHARMACEUTICALS - 1.9%
American Cyanamid Co. 18,300 $ 953,888
Circa Pharmaceuticals, Inc. (a) 110,400 1,090,200
Hauser Chemical Research, Inc. (a) 204,000 1,453,500
Idexx Corp. (a) 15,200 486,400
Pfizer, Inc. 15,200 969,000
Upjohn Co. 19,000 610,375
Warner-Lambert Co. 6,300 443,363
6,006,726
MEDICAL EQUIPMENT & SUPPLIES - 3.3%
Becton, Dickinson & Co. 77,400 2,950,875
Boston Scientific Corp. (a) 80,200 1,182,950
Datascope Corp. 2,500 41,719
Kendall International, Inc. (a) 9,100 439,075
Medtronic, Inc. 37,100 3,051,475
Millipore Corp. 13,900 733,225
Owens and Minor, Inc. 96,900 2,216,588
10,615,907
MEDICAL FACILITIES MANAGEMENT - 0.7%
Manor Care, Inc. 59,700 1,544,738
U.S. Healthcare, Inc. 14,250 573,563
Vitalink Pharmacy Services, Inc. (a) 15,600 156,000
2,274,301
TOTAL HEALTH 18,896,934
INDUSTRIAL MACHINERY & EQUIPMENT - 5.9%
ELECTRICAL EQUIPMENT - 1.2%
Asea AB sponsored ADR 1,300 102,050
C COR Electronics, Inc. (a) 17,200 356,900
Grainger (W.W.), Inc. 33,400 2,175,175
Mitsubishi Electric Co. Ord. 47,000 304,071
Scientific-Atlanta, Inc. 22,700 848,413
Star Paging International Holdings Ltd. 78,000 32,307
3,818,916
INDUSTRIAL MACHINERY & EQUIPMENT - 4.7%
Brenco, Inc. 207,500 2,308,438
CMI Corp. Class A 15,600 111,150
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
Cascade Corp. 82,500 $ 1,650,000
Cooper Industries, Inc. 22,100 801,125
Duriron Company, Inc. 74,800 1,084,600
Greenfield Industries, Inc. 8,300 154,588
JLG Industries, Inc. 40,400 1,252,400
Manitowoc Co., Inc. 103,200 2,644,500
Regal-Beloit Corp. 94,900 2,562,300
Stewart & Stevenson Services, Inc. 35,500 1,553,125
Twin Disc, Inc. 35,700 687,225
14,809,451
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 18,628,367
MEDIA & LEISURE - 9.8%
BROADCASTING - 1.1%
Associated Communications Corp. Class B (a) 56,500 1,320,688
Capital Cities/ABC, Inc. 3,000 2,219,250
United Television, Inc. 700 31,675
3,571,613
ENTERTAINMENT - 0.2%
Royal Carribean Cruises Ltd. 19,900 579,588
LEISURE DURABLES & TOYS - 2.3%
Brunswick Corp. 104,800 2,593,800
Coleman, Inc. (a) 1,200 33,150
Fleetwood Enterprises, Inc. 55,500 1,165,500
Sports and Recreation, Inc. (a) 43,800 1,730,100
West Marine, Inc. 88,000 1,826,000
7,348,550
LODGING & GAMING - 5.6%
Accor Asia Pacific Ltd. 346,300 280,919
Caesars World, Inc. (a) 8,800 344,300
Circus Circus Enterprises, Inc. (a) 8,100 187,313
Hilton Hotels Corp. 69,100 3,843,688
Hospitality Franchise Systems, Inc. (a) 51,600 1,399,650
La Quinta Motor Inns, Inc. 249,525 7,329,797
Mirage Resorts, Inc. (a) 81,500 1,599,438
Penn National Gaming, Inc. 12,600 130,725
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
MEDIA & LEISURE - CONTINUED
LODGING & GAMING - CONTINUED
President Riverboat Casinos, Inc. (a) 41,000 $ 389,500
Promus Companies, Inc. (a) 27,000 1,029,375
Sahara Gaming Corp. (a) 75,667 586,419
Supertel Hospitality, Inc. 16,500 189,750
WMS Industries, Inc. (a) 22,800 510,150
17,821,024
PUBLISHING - 0.3%
American City Business Journals, Inc. (a) 13,200 188,100
Commerce Clearing House, Inc. Class A 26,900 484,200
Score Board, Inc. (a) 6,700 54,438
Wiley (John) & Sons, Inc. Class A 4,100 339,275
1,066,013
RESTAURANTS - 0.3%
Sizzler International, Inc. 28,000 192,500
Taco Cabana, Inc. Class A (a) 26,400 409,200
Uno Restaurant Corp. (a) 30,400 319,200
920,900
TOTAL MEDIA & LEISURE 31,307,688
NONDURABLES - 2.4%
AGRICULTURE - 0.1%
Chai-Na-Ta Ginseng Products (a) 19,500 81,118
Delta & Pine Land Co. (a) 15,200 288,800
369,918
BEVERAGES - 0.5%
Big Rock Brewery Ltd. 6,800 82,450
Canadaigua Wine Co. Class A (a) 61,800 1,421,400
1,503,850
FOODS - 0.5%
Dean Foods Co. 40,100 1,092,725
Lance, Inc. 27,600 501,975
Savanna Foods & Industries, Inc. 3,600 37,800
1,632,500
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
NONDURABLES - CONTINUED
HOUSEHOLD PRODUCTS - 1.0%
Luxottica Group SPA sponsored ADR 7,200 $ 223,200
Neutrogena Corp. 146,700 2,787,300
3,010,500
TOBACCO - 0.3%
Philip Morris Companies, Inc. 22,100 1,088,425
TOTAL NONDURABLES 7,605,193
PRECIOUS METALS - 0.1%
Homestake Mining Co. 9,300 181,350
RETAIL & WHOLESALE - 4.8%
APPAREL STORES - 0.4%
AnnTaylor Stores Corp. (a) 35,300 1,182,550
BON-TON Stores, Inc. (a) 2,500 20,938
Harolds Stores, Inc. (a) 100 1,238
Sportmart, Inc. (a) 10,600 149,725
1,354,451
GENERAL MERCHANDISE STORES - 0.2%
Dayton Hudson Corp. 5,000 393,125
Nordstrom, Inc. 6,300 277,988
Proffitts, Inc. (a) 5,000 97,500
768,613
GROCERY STORES - 1.0%
Harry's Farmers' Market, Inc. Class A (a) 12,300 144,525
Starbucks Corp. (a) 35,400 1,008,900
Whole Foods Market, Inc. (a) 123,900 1,858,500
3,011,925
RETAIL & WHOLESALE, MISCELLANEOUS - 3.2%
Best Buy Co., Inc. (a) 109,000 3,147,375
CDW Computer Centers, Inc. (a) 3,800 71,250
Circuit City Stores, Inc. 7,100 137,563
Cole National Corp. Class A 100 1,288
Friedmans, Inc. Class A (a) 2,500 34,375
Lowe's Companies, Inc. 14,700 461,213
Micro Warehouse, Inc. (a) 20,700 522,675
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
RETAIL & WHOLESALE - CONTINUED
RETAIL & WHOLESALE, MISCELLANEOUS - CONTINUED
North West Company, Inc. 47,000 $ 501,537
Office Depot, Inc. (a) 67,200 2,511,600
Sodak Gaming, Inc. (a) 15,200 277,400
Sotheby's Holdings, Inc. Class A 136,300 1,754,863
Staples, Inc. 6,200 179,800
Tiffany & Company, Inc. 4,100 142,475
Viking Office Products, Inc. (a) 5,600 280,350
10,023,764
TOTAL RETAIL & WHOLESALE 15,158,753
SERVICES - 4.5%
LEASING & RENTAL - 0.2%
Blockbuster Entertainment Corp. 23,100 652,575
PRINTING - 2.9%
Cryk, Inc. (a) 26,300 670,650
Donnelley (R.R.) & Sons Co. 15,400 423,500
Graphic Industries, Inc. 11,400 99,750
New England Business Service, Inc. 101,600 1,968,500
Reynolds & Reynolds Co. Class A 155,800 3,544,450
Wallace Computer Services, Inc. 79,400 2,640,050
9,346,900
SERVICES - 1.4%
Devry, Inc. (a) 70,800 1,893,900
Manpower, Inc. (a) 37,100 718,813
Pittston Company Services Group 16,400 422,300
Regis Corporation (a) 18,400 239,200
Robert Half International, Inc. (a) 1,300 44,200
Service Corp. International 46,200 1,131,900
4,450,313
TOTAL SERVICES 14,449,788
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TECHNOLOGY - 19.9%
COMMUNICATIONS EQUIPMENT - 1.4%
Cabletron Systems, Inc. (a) 5,200 $ 514,800
Ericsson (L.M.) Telephone Co. Class B ADR 6,300 316,575
Harmon Industries, Inc. (a) 63,100 1,293,550
Newbridge Networks Corp. (a) 17,000 784,125
Syntellect, Inc. (a) 35,100 109,688
Union Switch and Signal, Inc. (a) 3,700 66,600
3Com Corp. (a) 33,100 1,555,700
4,641,038
COMPUTER SERVICES & SOFTWARE - 6.8%
Adobe Systems, Inc. 25,600 736,000
Broderbund Software, Inc. (a) 3,600 158,400
CACI International, Inc. Class A 23,300 221,350
Cheyenne Software, Inc. (a) 9,550 191,000
Computer Task Group, Inc. 8,900 76,763
Compuware Corp. (a) 44,100 1,868,738
General Motors Corp. Class E 43,700 1,534,963
Henry (Jack) & Associates, Inc. 134,333 1,192,205
Intuit (a) 20,700 719,325
Investment Technology Group, Inc. 24,000 366,000
Keane, Inc. (a) 18,450 684,956
Lotus Development Corp. (a) 3,500 210,000
Microsoft Corp. (a) 29,100 1,564,125
Novell, Inc. (a) 101,300 1,798,075
Oracle Systems Corp. (a) 149,000 5,103,250
Parametric Technology Corp. (a) 52,000 1,540,500
Peoplesoft, Inc. (a) 45,700 1,513,813
Platinum Technology, Inc. (a) 64,300 868,050
SunGard Data Systems, Inc. (a) 14,600 521,038
Sybase, Inc. (a) 13,700 739,800
21,608,351
COMPUTERS & OFFICE EQUIPMENT - 9.3%
ADAPTEC, Inc. (a) 26,600 468,825
Canon, Inc. 120,000 1,992,817
Compaq Computer Corp. (a) 34,100 4,032,325
Conner Peripherals, Inc. (a) 183,400 2,796,850
Danka Business Systems PLC sponsored ADR 18,800 796,650
Dell Computer Corporation (a) 165,200 4,728,850
Diebold, Inc. 159,750 6,869,250
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TECHNOLOGY - CONTINUED
COMPUTERS & OFFICE EQUIPMENT - CONTINUED
EMC Corp. (a) 238,900 $ 4,031,438
Intergraph Corp. (a) 18,200 168,350
Komag, Inc. (a) 13,800 310,500
Microtouch Systems, Inc. 31,400 620,150
Silicon Graphics, Inc. (a) 106,300 2,405,038
Tech Data Corp. (a) 27,800 437,850
29,658,893
ELECTRONIC INSTRUMENTS - 0.4%
Applied Materials, Inc. (a) 19,000 828,875
Hung Chang Products Co. 11,000 294,826
1,123,701
ELECTRONICS - 2.0%
Advanced Micro Devices, Inc. (a) 11,300 305,100
Atmel Corp. (a) 1,400 36,050
Cirrus Logic, Inc. (a) 9,500 323,594
Hitachi Ltd. 200,000 2,053,759
Intel Corp. 30,500 1,906,250
Linear Technology Corp. 21,600 972,000
Maxim Integrated Products, Inc. (a) 10,800 567,000
National Semiconductor Corp. (a) 7,700 149,188
6,312,941
TOTAL TECHNOLOGY 63,344,924
TRANSPORTATION - 8.0%
AIR TRANSPORTATION - 0.8%
Korean Air (a) 45,000 1,440,625
Mesa Airlines, Inc. (a) 62,400 748,800
SkyWest, Inc. 12,100 390,225
2,579,650
RAILROADS - 5.8%
ABC Rail Products Corp. (a) 30,600 577,575
CSX Corp. 32,300 2,470,950
Illinois Central Corp., Series A 89,500 3,110,125
Johnstown America Industries, Inc. (a) 40,800 867,000
Portec, Inc. (a) 13,200 188,100
Santa Fe Pacific Corp. 53,400 1,214,850
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TRANSPORTATION - CONTINUED
RAILROADS - CONTINUED
Southern Pacific Rail Corp. (a) 86,200 $ 1,896,400
Trinity Industries, Inc. 157,500 5,827,500
Wisconsin Central Transportation Corp. (a) 33,700 2,337,938
18,490,438
SHIPPING - 0.1%
OMI Corp. (a) 23,600 153,400
TRUCKING & FREIGHT - 1.3%
Carolina Freight Corp. 17,200 187,050
Consolidated Freightways, Inc. (a) 41,000 1,055,750
Detroit & Canada Tunnel Corp. 1,000 26,750
Expeditors International of Washington, Inc. 31,500 551,250
Roadway Services, Inc. 32,500 2,315,625
4,136,425
TOTAL TRANSPORTATION 25,359,913
UTILITIES - 2.8%
CELLULAR - 1.3%
Airtouch Communications 18,500 450,938
Dial Page, Inc. (a) 75,100 2,515,850
Onecomm Corp. 52,700 1,146,225
4,113,013
ELECTRIC UTILITY - 0.4%
Korea Electric Power Corp. 35,010 1,194,658
GAS - 0.1%
Tejas Gas Corp. (Del.) (a) 9,500 464,313
TELEPHONE SERVICES - 1.0%
ALC Communications Corp. (a) 21,600 685,800
C-TEC Corp. (a) 12,100 308,550
LDDS Communications, Inc. (a) 45,954 844,405
Rochester Telephone Corp. 57,800 1,293,254
Transaction Network Services, Inc. 16,300 173,188
3,305,197
TOTAL UTILITIES 9,077,181
TOTAL COMMON STOCKS
(Cost $288,315,289) 296,886,049
NONCONVERTIBLE PREFERRED STOCKS - 0.1%
SHARES VALUE (NOTE 1)
FINANCE - 0.1%
CREDIT & OTHER FINANCE - 0.1%
Tong Yang Securities (a)
(Cost $432,279) 20,600 $ 385,978
REPURCHASE AGREEMENTS - 6.6%
MATURITY
AMOUNT
Investments in repurchase agreements,
(U.S. Treasury obligations), in a
joint trading account at 4.26%
dated 5/31/94 due 6/1/94 $ 21,029,488 21,027,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $309,774,568) $ 318,299,027
LEGEND
(a) Non-income producing
OTHER INFORMATION
Distribution of investments by country of issue, as a percentage of total
value of investment in securities, is as follows:
United States 87.8%
Japan 4.0
Canada 3.2
Korea 1.8
Malaysia 1.5
Others (individually less than 1%) 1.7
TOTAL 100.0%
INCOME TAX INFORMATION
At April 30, 1994, the aggregate cost of investment securities for income
tax purposes was $309,858,601. Net unrealized appreciation aggregated
$8,440,426, of which $24,222,786 related to appreciated investment
securities and $15,782,360 related to depreciated investment securities.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
MAY 31, 1994 (UNAUDITED)
ASSETS
Investment in securities, at value (including repurchase $ 318,299,027
agreements of $21,027,000) (cost $309,774,568)
(Notes 1 and 2) - See accompanying schedule
Cash 357
Receivable for investments sold 21,561,175
Receivable for fund shares sold 724,220
Dividends receivable 373,742
TOTAL ASSETS 340,958,521
LIABILITIES
Payable for investments purchased $ 27,986,682
Payable for fund shares redeemed 776,443
Accrued management fee 212,057
Other payables and accrued expenses 188,123
TOTAL LIABILITIES 29,163,305
NET ASSETS $ 311,795,216
Net Assets consist of (Note 1):
Paid in capital $ 298,066,353
Accumulated net investment (loss) (112,664)
Accumulated undistributed net realized gain (loss) on 5,317,068
investments
Net unrealized appreciation (depreciation) on investment 8,524,459
securities
NET ASSETS, for 26,879,084 shares outstanding $ 311,795,216
NET ASSET VALUE and redemption price per share $11.60
($311,795,216 (divided by) 26,879,084 shares)
Maximum offering price per share (100/97 of $11.60) $11.96
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED MAY 31, 1994 (UNAUDITED)
INVESTMENT INCOME $ 1,545,137
Dividends
Interest 461,870
TOTAL INCOME 2,007,007
EXPENSES
Management fee (Note 4) $ 1,037,398
Basic fee
Performance adjustment 216,169
Transfer agent fees (Note 4) 573,498
Accounting fees and expenses (Note 4) 93,113
Non-interested trustees' compensation 934
Custodian fees and expenses 77,978
Registration fees 30,126
Audit 15,443
Legal 1,444
Miscellaneous 921
Total expenses before reductions 2,047,024
Expense reductions (Note 5) (43,700) 2,003,324
NET INVESTMENT INCOME 3,683
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 5,892,893
(NOTES 1 AND 3)
Net realized gain (loss) on investment securities
Change in net unrealized appreciation (depreciation) on (11,093,932)
investment securities
NET GAIN (LOSS) (5,201,039)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ (5,197,356)
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS DECEMBER 28,
ENDED MAY 31, 1992
1994 (COMMENCEMENT
(UNAUDITED) OF
OPERATIONS) TO
NOVEMBER 30,
1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 3,683 $ (177,405)
Net investment income (loss)
Net realized gain (loss) on investments 5,892,893 6,532,870
Change in net unrealized appreciation (depreciation) (11,093,932) 19,618,391
on investments
NET INCREASE (DECREASE) IN NET ASSETS RESULTING (5,197,356) 25,973,856
FROM OPERATIONS
Distributions to shareholders
From net realized gain (6,389,367) -
Share transactions 216,946,540 413,120,185
Net proceeds from sales of shares
Reinvestment of distributions 6,209,934 -
Cost of shares redeemed (153,883,456) (184,985,120)
Net increase (decrease) in net assets resulting from 69,273,018 228,135,065
share
transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS 57,686,295 254,108,921
NET ASSETS
Beginning of period 254,108,921 -
End of period (including accumulated net investment $ 311,795,216 $ 254,108,921
loss of $112,664 and $177,405, respectively)
OTHER INFORMATION
Shares
Sold 17,743,655 37,507,976
Issued in reinvestment of distributions 516,510 -
Redeemed (12,612,696) (16,276,361)
Net increase (decrease) 5,647,469 21,231,615
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED DECEMBER 28, 1992
MAY 31, 1994 (COMMENCEMENT
OF OPERATIONS) TO
NOVEMBER 30,
(UNAUDITED) 1993
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 11.97 $ 10.00
Income from Investment Operations
Net investment income - (.01)
Net realized and unrealized gain (loss) on (.07) 1.98
investments
Total from investment operations (.07) 1.97
Less Distributions
From net realized gain (.30) -
Net asset value, end of period $ 11.60 $ 11.97
TOTAL RETURN (dagger)(double dagger) (.67)% 19.70%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 311,795 $ 254,109
Ratio of expenses to average net assets (diamond) 1.32%* 1.32%*
Ratio of expenses to average net assets before 1.34%* 1.34%*
expense reductions (diamond)
Ratio of net investment income to average net assets - (.10)%*
Portfolio turnover rate 185%* 204%*
</TABLE>
* ANNUALIZED
(dagger) THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
(double dagger) TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND
FOR PERIODS LESS THAN ONE YEAR ARE NOT ANNUALIZED.
(diamond) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
NOTES TO FINANCIAL STATEMENTS
For the period ended May 31, 1994 (Unaudited)
1. SIGNIFICANT ACCOUNTING
POLICIES.
Fidelity New Millennium Fund (the fund) is a fund of Fidelity Mt. Vernon
Street Trust (the trust) and is authorized to issue an unlimited number of
shares. The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Massachusetts business trust. The following summarizes the
significant accounting policies of the fund:
SECURITY VALUATION. 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 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 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 current exchange rate. Purchases and sales of securities,
income receipts and expense payments are translated into U.S. dollars at
the exchange rate on the dates of the transactions.
It is not practicable to identify the portion of each amount shown in the
fund's Statement of Operations under the caption "Realized and Unrealized
Gain (Loss) on Investments" that arises from changes in foreign currency
exchange rates. Investment income includes net realized and unrealized
currency gains and losses recognized between accrual and payment dates.
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 re-
garding 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 the fund is informed of the
ex-dividend date. Interest income is accrued as earned. Dividend and
interest income is recorded net of foreign taxes withheld where recovery of
such taxes is uncertain.
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. Distributions are recorded on the
ex-dividend date.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
foreign currency transactions 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 distri-
butions will result in reclassifications to paid in capital. Undistributed
net investment income 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.
CHANGE IN ACCOUNTING FOR DISTRIBUTIONS TO SHAREHOLDERS. Effective December
1, 1993, the fund adopted Statement of Position 93-2: Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain,
and Return of Capital Distributions by Investment Companies. As a result,
the fund changed the classification of distributions to shareholders to
better disclose the differences between financial statement amounts and
distributions determined in accordance with income tax regulations.
Accordingly, amounts as of November 30, 1993 have been reclassified to
reflect an increase in paid in capital of $2, a decrease in undistributed
net investment loss of $61,058 and a decrease in accumulated net realized
gain on investments of $61,060.
2. OPERATING POLICIES.
FORWARD FOREIGN CURRENCY CONTRACTS. The fund may enter into forward foreign
currency contracts. These contracts involve market risk in excess of the
amount reflected in the fund's Statement of Assets and Liabilities. The
face or contract amount in U.S. dollars reflects the total exposure the
fund has in that particular currency contract. The U.S. dollar value of
forward foreign currency contracts is determined using forward currency
exchange rates supplied by a quotation service. Losses may arise due to
changes in the value of the foreign currency or if the counterparty does
not perform under the contract.
Purchases and sales of forward foreign currency contracts having the same
settlement date and broker are offset and presented net on the Statement of
Assets and Liabilities. Gain (loss) on the purchase or sale of forward
foreign currency contracts having the same settlement date and broker is
recognized on the date of offset, otherwise gain (loss) is recognized on
settlement date.
2. OPERATING POLICIES -
CONTINUED
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. The fund's investment
adviser, Fidelity Management & Research Company (FMR), is responsible
for determining that the value of these underlying securities remains at
least equal to the resale price.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other registered
investment companies having management contracts with FMR, may transfer
uninvested cash balances into a joint trading account. These balances are
invested in one or more repurchase agreements that are collateralized by
U.S. Treasury or Federal Agency obligations.
3. PURCHASES AND SALES OF
INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $328,400,702 and $258,040,860, 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 ranging from
.30% to .52% and is based on the monthly average net assets of all the
mutual funds advised by FMR. The annual individual fund fee rate is .35%.
The basic fee is subject to a performance adjustment (up to a maximum of +
or - .20%) based on the fund's investment performance as compared to the
appropriate index over a specified period of time. The fund's performance
adjustment took effect on December 1, 1993. For the period, the management
fee was equivalent to an annualized rate of .82% of average net assets
after the performance adjustment.
The Board of Trustees approved a new group fee rate schedule with rates
rang-
ing from .2850% to .5200%. Effective November 1, 1993, FMR has voluntarily
agreed to implement this new group fee rate schedule as it results in the
same or a lower management fee.
SALES LOAD. For the period, Fidelity Distributors Corporation, an affiliate
of FMR and the general distributor of the fund, received sales charges of
$739,816 on sales of shares of the fund.
TRANSFER AGENT FEE. Fidelity Service Co. (FSC), an affiliate of FMR, is the
fund's transfer, dividend disbursing and shareholder servicing agent. FSC
receives fees based on the type, size, number of accounts and the number of
transactions made by shareholders. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements.
ACCOUNTING FEE. 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.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
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 $39,357 for the period.
5. 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
$43,700 under this arrangement.
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. FOR MORE
INFORMATION ON ANY
FIDELITY FUND INCLUDING MANAGEMENT FEES AND CHARGES, CALL 1-800-544-8888
FOR A FREE
PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
INVESTMENT ADVISER
Fidelity Management & Research
Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Gary L. French, Treasurer
John H. Costello, Assistant Treasurer
Arthur S. Loring, Secretary
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*
Gerald C. McDonough*
Thomas R. Williams*
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co.
Boston, MA
CUSTODIAN
Chase Manhattan Bank, N.A.
New York, NY
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 Growth 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)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
