FIDELITY
(REGISTERED TRADEMARK)
GROWTH COMPANY
FUND
ANNUAL REPORT
NOVEMBER 30, 1996
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 6 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 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 26 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
NOTES 30 Notes to the financial statements.
REPORT OF INDEPENDENT 34 The auditors' opinion.
ACCOUNTANTS
DISTRIBUTIONS 35
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE
PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND MONEY.
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
Although stocks have managed to post solid returns throughout 1996, signs
of strength in the economy have led to inflation fears, causing some
uncertainty in both the stock and bond markets so far this year. In 1995,
both stock and bond markets posted strong results, while the year before,
stocks posted below-average returns and bonds had one of the worst years in
history.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
If you can leave your money invested over the long term, you can avoid the
results of the volatility that generally accompanies the stock market in
the short term. You also can help to manage some of the risks of investing
through diversification. A stock fund is already diversified because it
invests in many issues. You can diversify even further by placing some of
your money in several different types of stock funds or in other investment
categories, such as bonds.
If you have a short investment time horizon, you might want to consider
moving some of your investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
Finally, no matter what your investment horizon or portfolio diversity, it
makes good sense to follow a regular investment plan - investing a certain
amount of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
If you have any questions, please call us at 1-800-544-8888. We stand ready
to provide the information you need to make the investments that are right
for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. A fund's total
return includes changes in share price, plus reinvestment of any dividends
(or income) and capital gains (the profits the fund earns when it sells
securities that have grown in value). The fund has a 3% sales charge, which
has been waived from January 1, 1995 through December 31, 1996. Effective
January 1, 1997, the fund's 3% sales charge will be eliminated.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1996 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Growth Company 19.55% 134.47% 401.49%
Growth Company 15.97% 127.44% 386.45%
(incl. 3% sales charge)
S&P 500(registered trademark) 27.86% 130.90% 310.22%
Growth Funds Average 21.09% 110.80% 264.19%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one, five, or 10 years. For example, if
you invested $1,000 in a fund that had a 5% return over the past year, the
value of your investment would be $1,050. You can compare the fund's
returns to the performance of the Standard & Poor's 500 Index - a widely
recognized, unmanaged index of common stocks. To measure how the fund's
performance stacked up against its peers, you can compare it to the growth
funds average, which reflects the performance of 652 mutual funds with
similar objectives tracked by Lipper Analytical Services, Inc. over the
past 12 months. Both benchmarks include reinvested dividends and capital
gains, if any, and exclude the effects of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30,
1996 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Growth Company 19.55% 18.58% 17.50%
Growth Company 15.97% 17.86% 17.14%
(incl. 3% sales charge)
S&P 500 27.86% 18.21% 15.16%
Growth Funds Average 21.09% 15.77% 13.39%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19961130 19961219 124410 S00000000000001
Growth Company SP Standard & Poor 500
00025 SP001
1986/11/30 9700.00 10000.00
1986/12/31 9480.58 9745.00
1987/01/31 10684.48 11057.65
1987/02/28 11658.87 11494.43
1987/03/31 11537.07 11826.62
1987/04/30 11110.77 11721.36
1987/05/31 11070.17 11823.34
1987/06/30 11252.87 12420.42
1987/07/31 11773.90 13050.13
1987/08/31 12538.53 13536.90
1987/09/30 12254.33 13240.44
1987/10/31 8992.82 10388.45
1987/11/30 8052.27 9532.44
1987/12/31 9319.75 10257.86
1988/01/31 9355.54 10689.72
1988/02/29 9928.18 11187.86
1988/03/31 10042.71 10842.15
1988/04/30 9928.18 10962.50
1988/05/31 9878.07 11057.87
1988/06/30 10715.56 11565.43
1988/07/31 10493.66 11521.48
1988/08/31 10064.18 11129.75
1988/09/30 10629.66 11603.88
1988/10/31 10515.14 11926.47
1988/11/30 10371.97 11755.92
1988/12/31 10816.84 11961.65
1989/01/31 11574.01 12837.24
1989/02/28 11553.58 12517.59
1989/03/31 11950.20 12809.25
1989/04/30 12765.49 13474.05
1989/05/31 13764.40 14019.75
1989/06/30 13264.94 13939.84
1989/07/31 14153.68 15198.61
1989/08/31 14733.93 15496.50
1989/09/30 15152.59 15432.96
1989/10/31 14998.35 15074.92
1989/11/30 15064.45 15382.45
1989/12/31 15321.11 15751.63
1990/01/31 14155.02 14694.69
1990/02/28 14778.55 14884.25
1990/03/31 15572.14 15278.69
1990/04/30 15345.40 14896.72
1990/05/31 16956.87 16349.15
1990/06/30 17151.22 16237.98
1990/07/31 16616.76 16186.01
1990/08/31 14891.92 14722.80
1990/09/30 13571.97 14005.80
1990/10/31 13636.76 13945.57
1990/11/30 15094.37 14846.46
1990/12/31 15871.76 15260.67
1991/01/31 17661.38 15926.04
1991/02/28 18803.18 17064.75
1991/03/31 19823.50 17477.72
1991/04/30 19645.35 17519.66
1991/05/31 20689.97 18276.51
1991/06/30 19297.15 17439.45
1991/07/31 20827.64 18252.13
1991/08/31 21726.50 18684.70
1991/09/30 21596.93 18372.67
1991/10/31 21548.34 18618.86
1991/11/30 20746.66 17868.52
1991/12/31 23542.62 19912.68
1992/01/31 23807.54 19542.31
1992/02/29 24009.82 19796.35
1992/03/31 22769.76 19410.33
1992/04/30 22330.02 19980.99
1992/05/31 22303.63 20078.90
1992/06/30 21512.10 19779.72
1992/07/31 22277.25 20588.71
1992/08/31 21670.41 20166.64
1992/09/30 22013.40 20404.61
1992/10/31 23200.70 20476.03
1992/11/30 24739.79 21174.26
1992/12/31 25412.58 21434.70
1993/01/31 26029.77 21614.75
1993/02/28 25302.37 21908.71
1993/03/31 26204.71 22370.99
1993/04/30 25919.28 21829.61
1993/05/31 27374.07 22414.64
1993/06/30 27475.36 22479.65
1993/07/31 27033.39 22389.73
1993/08/31 28138.30 23238.30
1993/09/30 28930.15 23059.36
1993/10/31 29326.08 23536.69
1993/11/30 28460.57 23313.09
1993/12/31 29526.77 23595.18
1994/01/31 30484.55 24397.42
1994/02/28 29995.00 23736.25
1994/03/31 28597.75 22701.35
1994/04/30 28934.31 22991.92
1994/05/31 28771.13 23368.99
1994/06/30 27445.27 22796.45
1994/07/31 28077.60 23544.18
1994/08/31 29505.45 24509.49
1994/09/30 28913.92 23909.00
1994/10/31 29852.22 24446.96
1994/11/30 28811.93 23556.60
1994/12/31 28869.96 23905.94
1995/01/31 28552.24 24525.82
1995/02/28 29738.38 25481.60
1995/03/31 30903.35 26233.56
1995/04/30 32237.76 27006.14
1995/05/31 33381.55 28085.57
1995/06/30 35859.75 28738.00
1995/07/31 38528.58 29690.95
1995/08/31 39005.15 29765.47
1995/09/30 40106.57 31021.58
1995/10/31 39884.17 30910.83
1995/11/30 40689.06 32267.82
1995/12/31 40306.21 32889.29
1996/01/31 41282.22 34008.85
1996/02/29 42243.05 34324.11
1996/03/31 42567.05 34654.65
1996/04/30 43885.40 35165.46
1996/05/31 45092.03 36072.38
1996/06/30 44477.54 36209.81
1996/07/31 41751.46 34610.06
1996/08/31 42734.64 35339.99
1996/09/30 45650.65 37328.92
1996/10/31 45851.75 38358.45
1996/11/29 48644.87 41022.00
IMATRL PRASUN SHR__CHT 19961130 19961219 124413 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was invested
in Fidelity Growth Company Fund on November 30, 1986, and the maximum 3%
sales charge was paid. As the chart shows, by November 30, 1996, the value
of the investment would have grown to $48,645 - a 386.45% increase on the
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 $41,022 - a 310.22% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Paced by the robust performance
of blue chip stocks, the U.S. stock
market posted strong gains for the
year that ended November 30,
1996. The Standard & Poor's 500
Index returned 27.86% during the
period - well above its long-term
average of about 12%. The stock
market spent much of the past
year breaking price and trading
volume records. Solid corporate
earnings reports, large cash
inflows into mutual funds,
widespread optimism and a
generally favorable interest rate
environment propelled share
prices higher. Large capitalization
stocks thrived as investors sought
their lower volatility and higher
degree of liquidity over smaller
cap stocks in an environment
where it was sometimes difficult to
discern the health of the economy.
The Dow Jones Industrial
Average closed above 6500 for
the first time in November. While
short-term confusion over the
direction of interest rates created
a volatile backdrop in the summer
months, stocks rallied again when
the Federal Reserve Board left
short-term interest rates
unchanged and it appeared
inflation would not be an issue for
the remainder of 1996.
Smaller-company stocks posted
strong gains at the beginning of
1996, but trended downward in
the spring and summer because
their earnings tend to be more
affected by the higher borrowing
costs brought on by higher rates.
When interest rate fears subsided,
these stocks rebounded, only to
fade toward the end of the period
due to earnings concerns and a
general flight to quality.
An interview with Larry Greenberg, Portfolio Manager of Fidelity Growth
Company Fund
Q. WHAT CAN YOU TELL US ABOUT THE FUND'S PERFORMANCE, LARRY?
A. For the one-year period that ended November 30, 1996, the fund had a
total return of 19.55%. The Standard & Poor's 500 Index returned 27.86% and
the growth funds average, according to Lipper Analytical Services, was up
21.09%. The fund's underperformance in the past year is reflective of the
underperformance of technology stocks earlier in the period, which hurt
many growth-oriented investors if they sold these stocks.
Q. HAVE YOU MADE ANY MAJOR CHANGES SINCE YOU TOOK OVER THE FUND?
A. When I took over in June, the fund had about 15% of its assets in
short-term investments, so the first thing I did was try to reinvest some
of those assets in the stock market. Other than that, I haven't made any
significant changes. In fact, I can't imagine a smoother transition between
managers. The previous manager, Bob Stansky, and I have very similar
investment styles, and we've worked together for a number of years.
Q. HOW IS THE FUND POSITIONED IN TECHNOLOGY-RELATED COMPANIES? WERE THERE
ANY THEMES YOU FOLLOWED?
A. I focused the fund's technology weighting in what I call the "Nasdaq
Four" - Intel, Microsoft, Cisco Systems and Oracle. In the technology
arena, we've seen the bigger firms getting bigger at the expense of smaller
firms, which are finding it harder and harder to gain market share.
Additionally, the Nasdaq Four were well positioned to benefit from two
major trends during the period - growth of the Internet and growth in
personal computers.
Q. DECLINING SEMICONDUCTOR PRICES HAVE HURT THAT INDUSTRY OVER THE PAST
YEAR. WERE THERE ANY RECENT DEVELOPMENTS IN THIS SITUATION?
A. Semiconductor prices have stabilized following a freefall for much of
this past year. An oversupply in the market continues, but demand has
picked up as some companies have been able to work through their excess
inventories. Breaking it down a bit, DRAM (dynamic random access memory)
companies' pricing is still anemic; however, CPU (central processing unit)
companies' pricing is stronger.
Q. WHAT WAS THE STORY WITH THE FUND'S HEALTH CARE POSITION?
A. In my opinion, one of the most intriguing parts of the health care
market has been the pharmaceutical area. It was one segment of the market
where business fundamentals improved steadily throughout the year. With the
proliferation of managed care, we've seen strong unit demand for drugs. For
example, in the third quarter of 1996, Merck had a phenomenal 25% unit
growth in their domestic pharmaceutical business. In general, I looked for
companies with accelerated earnings momentum, good year-over-year earnings
growth and strong revenue growth that were trading at reasonable prices.
Q. HOW ABOUT RETAIL?
A. I think finally we may be seeing a good time for retail. If you look at
the past three years, consumer demand was pretty poor. In the past year,
however, we've seen demand picking up and the beginnings of a turnaround in
the earnings growth rate of some major retailers. I also targeted specialty
retailers considered to be "category killers" - companies that dominate
their market segment no matter what is happening in the overall retail
market or the economy. One example of a category killer was PETsMART.
Q. WAS THERE A PARTICULAR STOCK THAT DIDN'T LIVE UP TO EXPECTATIONS?
A. While category-killer retail stocks can be great growth companies, they
can be quite volatile as well. Such was the case with Sunglass Hut
International, whose revenue growth and earnings rapidly deteriorated
during the period. Thus, the fund sustained some losses as a result of
holding this stock.
Q. HOW ARE YOU POSITIONING THE FUND GOING FORWARD?
A. Obviously, the stock market has had quite a run, and we have enjoyed a
long economic expansion. In this environment, I'm trying to reduce some of
the risk in the fund by spreading assets over a variety of industries and
stocks that haven't gone up as much as the overall market. While this
strategy does not eliminate risk in the fund, I believe it's the best
course of action in an uncertain time.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: to increase the value
of the fund's shares over the
long term by investing in
stocks with above-average
growth potential
FUND NUMBER: 025
TRADING SYMBOL: FDGRX
START DATE: January 17, 1983
SIZE: as of November 30,
1996, more than $9.6 billion
MANAGER: Larry Greenberg,
since June 1996; manager,
Fidelity Advisor Equity
Growth Fund, since June
1996; manager, Fidelity
Emerging Growth Fund,
since 1993; manager VIP
Growth Portfolio, since 1991;
joined Fidelity in 1986
(checkmark)
LARRY GREENBERG ON
COMPETITION IN HIGH TECH
INDUSTRIES:
"Much is discussed in the
financial press about the
intense competition in certain
segments of high tech. While
these corporate wars make
good news stories, they are
often oversimplified and
blown out of proportion. For
example, there's been a lot of
attention in the media devoted
to the "browser war" between
Netscape and Microsoft.
While Internet browsers are
Netscape's best-known
product, the company
generates most of its
revenues from corporate
applications of Internet
technology - not browsers.
"Another issue is whether
microprocessor-maker Intel
can maintain its dominance in
the face of new competition.
While it has some notable
competitors in a rapidly
changing market, people
often forget Intel's industry
clout, its vast R&D budget
and marketing strength, and
its ability to maintain
aggressive pricing."
NOTE TO SHAREHOLDERS:
Effective January 7, 1997,
Steven S. Wymer became
manager of the fund. Wymer
joined Fidelity in 1989, and
has worked as an analyst,
portfolio assistant and
manager of other Fidelity
funds.
INVESTMENT CHANGES
TOP TEN STOCKS AS OF NOVEMBER 30, 1996
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO
Intel Corp. 2.7 1.2
General Electric Co. 2.4 2.1
Cisco Systems, Inc. 2.4 1.9
Oracle Systems Corp. 2.0 1.3
HFS, Inc. 2.0 1.0
Federal National Mortgage 1.7 1.3
Association
International Business
Machines 1.7 0.2
Corp.
CUC International, Inc. 1.6 0.8
Microsoft Corp. 1.4 1.4
Lowe's Companies, Inc. 1.2 1.1
TOP FIVE MARKET SECTORS AS OF NOVEMBER 30, 1996
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET
SECTORS
6 MONTHS AGO
Technology 26.8 23.5
Health 10.6 11.2
Retail & Wholesale 9.9 10.0
Finance 9.3 10.7
Media & Leisure 6.6 4.8
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF NOVEMBER 30, 1996 * AS OF MAY 31, 1996 **
Row: 1, Col: 1, Value: 9.0
Row: 1, Col: 2, Value: 51.0
Row: 1, Col: 3, Value: 40.0
Stocks 84.9%
Short-term
investments 15.1%
FOREIGN
INVESTMENTS 2.6%
Row: 1, Col: 1, Value: 15.1
Row: 1, Col: 2, Value: 44.9
Row: 1, Col: 3, Value: 40.0
Stocks 91.0%
Short-term
investments 9.0%
FOREIGN
INVESTMENTS 3.6%
*
**
INVESTMENTS NOVEMBER 30, 1996
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 91.0%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 0.9%
AEROSPACE & DEFENSE - 0.7%
Boeing Co. 432,100 $ 42,940
Gulfstream Aerospace Corp. (a) 286,100 6,866
Lockheed Martin Corp. 247,000 22,384
72,190
DEFENSE ELECTRONICS - 0.2%
Raytheon Co. 392,500 20,067
TOTAL AEROSPACE & DEFENSE 92,257
BASIC INDUSTRIES - 2.4%
CHEMICALS & PLASTICS - 1.5%
Air Products & Chemicals, Inc. 96,000 6,672
Airgas, Inc. (a) 304,000 7,828
du Pont (E.I.) de Nemours & Co. 450,000 42,413
IMC Global, Inc. 35,400 1,279
Monsanto Co. 1,300,000 51,674
Potash Corp. of Saskatchewan 70,700 5,333
Praxair, Inc. 250,000 12,156
Union Carbide Corp. 304,200 14,031
141,386
IRON & STEEL - 0.1%
Nucor Corp. 197,600 10,745
METALS & MINING - 0.4%
Aluminum Co. of America 200,000 12,725
Freeport McMoRan Copper & Gold, Inc. Class A 125,000 3,734
Inco Ltd. 315,900 11,025
Titanium Metals Corp. (a) 288,500 9,665
37,149
PACKAGING & CONTAINERS - 0.2%
Crown Cork & Seal Co., Inc. 269,600 14,289
Tupperware Corp. 150,000 7,950
22,239
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
BASIC INDUSTRIES - CONTINUED
PAPER & FOREST PRODUCTS - 0.2%
International Paper Co. 300,000 $ 12,750
Kimberly-Clark Corp. 116,500 11,388
24,138
TOTAL BASIC INDUSTRIES 235,657
CONGLOMERATES - 0.8%
AlliedSignal, Inc. 475,000 34,794
Mark IV Industries, Inc. 361,400 7,906
United Technologies Corp. 240,100 33,674
76,374
CONSTRUCTION & REAL ESTATE - 0.0%
ENGINEERING - 0.0%
MasTec, Inc. (a) 4,700 222
REAL ESTATE INVESTMENT TRUSTS - 0.0%
RFS Hotel Investors, Inc. 16,700 280
TOTAL CONSTRUCTION & REAL ESTATE 502
DURABLES - 4.3%
AUTOS, TIRES, & ACCESSORIES - 2.6%
AutoZone, Inc. (a) 1,325,000 32,628
Chrysler Corp. 2,053,200 72,889
Danaher Corp. 258,300 11,559
Eaton Corp. 200,000 13,850
General Motors Corp. 1,351,763 77,895
Honda Motor Co. Ltd. 319,000 9,431
PACCAR, Inc. 93,200 6,198
Pep Boys-Manny, Moe & Jack 475,000 17,397
TRW, Inc. 50,000 4,869
246,716
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
DURABLES - CONTINUED
CONSUMER DURABLES - 0.4%
Minnesota Mining & Manufacturing Co. 450,000 $ 37,688
CONSUMER ELECTRONICS - 0.2%
Harman International Industries, Inc. 250,000 12,750
Newell Co. 355,900 11,033
23,783
HOME FURNISHINGS - 0.1%
Furniture Brands International, Inc. (a) 93,500 1,157
Leggett & Platt, Inc. 193,200 5,917
7,074
TEXTILES & APPAREL - 1.0%
Adidas AG (b) 55,500 4,801
Adidas AG 89,400 7,733
Gucci Group NV 182,600 13,398
Liz Claiborne, Inc. 171,900 7,284
NIKE, Inc. Class B 923,200 52,507
Tommy Hilfiger (a) 175,000 9,450
95,173
TOTAL DURABLES 410,434
ENERGY - 5.1%
ENERGY SERVICES - 1.5%
Baker Hughes, Inc. 221,500 8,112
Diamond Offshore Drilling, Inc. (a) 199,200 12,699
Dresser Industries, Inc. 334,000 10,939
Halliburton Co. 269,700 16,249
Schlumberger Ltd. 673,600 70,055
Tidewater, Inc. 175,300 7,669
Transocean Offshore, Inc. 74,900 4,513
Varco International, Inc. (a) 197,500 4,518
Western Atlas, Inc. (a) 202,900 14,304
149,058
INDEPENDENT POWER - 0.2%
Thermo Electron Corp. 458,000 16,603
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
ENERGY - CONTINUED
OIL & GAS - 3.4%
Abacan Resource Corp. (a) 424,400 $ 3,634
Amerada Hess Corp. 391,600 23,055
Anadarko Petroleum Corp. 165,000 11,034
Apache Corp. 346,100 12,589
Atlantic Richfield Co. 344,600 47,942
British Petroleum PLC ADR 312,581 43,371
Burlington Resources, Inc. 155,800 8,257
Chesapeake Energy Corp. (a) 321,800 21,038
Enron Oil & Gas Co. 250,000 6,656
Kerr-McGee Corp. 81,200 5,684
Louisiana Land & Exploration Co. 265,000 15,834
Nationale Elf Aquitaine 58,000 5,065
Occidental Petroleum Corp. 479,600 11,510
Parker & Parsley Petroleum Co. 94,800 3,128
Pennzoil Co. 141,200 7,943
Royal Dutch Petroleum Co. ADR 469,800 79,807
Union Pacific Resources Group, Inc. 185,600 5,545
Unocal Corp. 352,497 14,364
326,456
TOTAL ENERGY 492,117
FINANCE - 9.3%
BANKS - 2.9%
Bank of New York Co., Inc. 1,797,800 64,496
BankAmerica Corp. 625,000 64,375
Citicorp 865,000 94,501
First Bank System, Inc. 176,100 12,833
NationsBank Corp. 398,390 41,283
277,488
CREDIT & OTHER FINANCE - 1.6%
American Express Co. 1,882,516 98,360
Beneficial Corp. 191,300 11,885
Concord EFS, Inc. (a) 18,600 542
Green Tree Financial Corp. 490,000 20,519
Household International, Inc. 251,418 23,822
PHH Corp. 76,100 3,415
158,543
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - CONTINUED
FEDERAL SPONSORED CREDIT - 2.6%
Federal Home Loan Mortgage Corporation 687,600 $ 78,558
Federal National Mortgage Association 3,953,300 163,074
Student Loan Marketing Association 106,100 10,199
251,831
INSURANCE - 2.0%
Allstate Corp. 300,045 18,078
American General Corp. 92,800 3,816
American International Group, Inc. 475,000 54,624
CIGNA Corp. 123,300 17,432
Capital Re Corp. 53,100 2,038
General Re Corp. 138,700 23,406
ITT Hartford Group, Inc. 100,000 6,838
MBIA, Inc. 138,200 13,975
MGIC Investment Corp. 219,500 16,435
SunAmerica, Inc. 131,000 5,486
Travelers, Inc. (The) 400,066 18,003
UNUM Corp. 119,200 8,478
188,609
SECURITIES INDUSTRY - 0.2%
Schwab (Charles) Corp. 486,200 14,647
United Asset Management Corp. 116,500 3,160
17,807
TOTAL FINANCE 894,278
HEALTH - 10.6%
DRUGS & PHARMACEUTICALS - 6.1%
ALZA Corp. Class A (a) 309,000 8,729
American Home Products Corp. 925,000 59,431
Amgen, Inc. (a) 362,040 22,039
Biochem Pharmaceuticals, Inc. (a) 207,000 8,850
Biogen, Inc. (a) 935,700 35,791
Bristol-Myers Squibb Co. 659,800 75,052
Elan Corp. PLC ADR (a) 500,000 14,875
Genentech, Inc. special (a) 610,000 33,016
Lilly (Eli) & Co. 600,000 45,900
Merck & Co., Inc. 1,274,500 105,784
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
DRUGS & PHARMACEUTICALS - CONTINUED
Pfizer, Inc. 863,800 $ 77,418
Schering-Plough Corp. 619,500 44,139
SmithKline Beecham PLC ADR 595,600 41,022
Thermotrex Corp. (a) 58,700 1,996
Warner-Lambert Co. 159,400 11,397
585,439
MEDICAL EQUIPMENT & SUPPLIES - 2.1%
Boston Scientific Corp. (a) 360,200 21,027
Cardinal Health, Inc. 222,800 18,632
Johnson & Johnson 1,500,000 79,687
Medtronic, Inc. 814,800 53,879
Omnicare, Inc. 275,000 8,388
Pall Corp. 306,100 7,997
St. Jude Medical, Inc. (a) 247,600 10,337
Sofamor/Danek Group, Inc. (a) 181,400 5,102
205,049
MEDICAL FACILITIES MANAGEMENT - 2.4%
American Medical Response, Inc. (a) 197,100 5,913
Carematrix Corp. (a) 317,300 4,363
Columbia/HCA Healthcare Corp. 1,237,500 49,500
HEALTHSOUTH Rehabilitation Corp. (a) 2,063,900 77,654
Lincare Holdings, Inc. (a) 423,500 16,834
Oxford Health Plans, Inc. (a) 597,000 34,626
PacifiCare Health Systems, Inc. Class B (a) 260,100 21,588
United HealthCare Corp. 348,200 15,016
Vencor, Inc. (a) 62,200 2,014
227,508
TOTAL HEALTH 1,017,996
HOLDING COMPANIES - 0.1%
Norfolk Southern Corp. 69,700 6,273
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
INDUSTRIAL MACHINERY & EQUIPMENT - 4.0%
ELECTRICAL EQUIPMENT - 3.0%
Alcatel Alsthom Compagnie Generale d'Electricite SA 104,800 $ 9,527
American Power Conversion Corp. (a) 233,000 5,519
Duracell International, Inc. 39,600 2,638
Emerson Electric Co. 350,000 34,344
General Electric Co. 2,250,000 234,000
Leitch Technology Corp. (a) 142,000 2,736
Oak Industries, Inc. (a) 73,000 1,697
Westinghouse Electric Corp. 69,700 1,307
291,768
INDUSTRIAL MACHINERY & EQUIPMENT - 0.9%
Case Corp. 300,000 15,750
Caterpillar, Inc. 330,800 26,174
Illinois Tool Works, Inc. 104,700 8,978
Ingersoll-Rand Co. 300,000 13,950
MSC Industrial Direct, Inc. (a) 110,500 4,130
Stanley Works 176,900 5,219
UCAR International, Inc. (a) 267,600 10,135
84,336
POLLUTION CONTROL - 0.1%
USA Waste Services, Inc. (a) 219,700 7,085
WMX Technologies, Inc. 116,600 4,198
11,283
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 387,387
MEDIA & LEISURE - 6.6%
BROADCASTING - 0.6%
Clear Channel Communications, Inc. (a) 78,700 5,430
Emmis Broadcasting Corp. Class A (a) 45,600 1,568
Evergreen Media Corp. Class A (a) 350,000 8,663
Grupo Televisa SA de CV sponsored ADR (a) 249,500 6,799
Jacor Communications, Inc. Class A (a) 108,500 2,604
Lin Television Corp. (a) 162,700 6,528
PanAmSat Corp. (a) 290,700 8,358
Time Warner, Inc. 630 26
Viacom, Inc. Class B (non-vtg.) (a) 417,330 15,754
55,730
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - CONTINUED
ENTERTAINMENT - 0.4%
Disney (Walt) Co. 222,400 $ 16,402
MGM Grand, Inc. (a) 323,800 12,507
Regal Cinemas, Inc. (a) 232,500 7,585
36,494
LEISURE DURABLES & TOYS - 0.2%
Harley-Davidson, Inc. 373,200 16,561
Nintendo Co. Ltd. Ord. 90,900 6,439
23,000
LODGING & GAMING - 3.6%
Anchor Gaming (a) 11,700 488
Circus Circus Enterprises, Inc. (a) 1,009,600 36,850
Doubletree Corp. (a) 180,000 7,560
Extended Stay America, Inc. (a) 246,600 5,117
HFS, Inc. (a) 2,947,300 190,838
Hilton Hotels Corp. 940,320 27,504
Host Marriott Corp. 399,200 6,088
ITT Corp. (a) 150,100 6,923
Mirage Resorts, Inc. (a) 2,053,900 49,550
Penske Motorsports, Inc. (a) 11,000 337
Prime Hospitality Corp. (a) 124,600 2,071
Sun International Hotels Ltd. Ord. (a) 175,000 8,684
Wyndham Hotel Corp. (a) 48,900 960
342,970
PUBLISHING - 0.6%
Gannett Co., Inc. 200,000 15,700
Knight-Ridder, Inc. 350,000 14,700
New York Times Co. (The) Class A 215,000 8,036
Scholastic Corp. (a) 98,900 7,368
Times Mirror Co. Class A 283,900 14,869
60,673
RESTAURANTS - 1.2%
Apple South, Inc. 700,000 10,325
Applebee's International, Inc. 308,700 8,991
Landry's Seafood Restaurants, Inc. (a) 801,800 19,243
Lone Star Steakhouse Saloon (a) 912,200 26,112
Outback Steakhouse, Inc. (a) 218,200 6,301
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - CONTINUED
RESTAURANTS - CONTINUED
Planet Hollywood International, Inc. Class A (a) 342,900 $ 7,887
Rainforest Cafe, Inc. (a) 69,800 2,042
Starbucks Corp. (a) 886,800 30,704
111,605
TOTAL MEDIA & LEISURE 630,472
NONDURABLES - 3.3%
BEVERAGES - 1.1%
Anheuser-Busch Companies, Inc. 699,900 29,658
Coca-Cola Co. (The) 628,200 32,117
PepsiCo, Inc. 1,652,100 49,356
111,131
FOODS - 0.2%
General Mills, Inc. 69,700 4,426
Nabisco Holdings Corp. Class A 285,500 11,063
15,489
HOUSEHOLD PRODUCTS - 1.1%
Avon Products, Inc. 151,200 8,429
Gillette Co. 611,300 45,083
Procter & Gamble Co. 488,900 53,169
106,681
TOBACCO - 0.9%
Philip Morris Companies, Inc. 827,800 85,367
TOTAL NONDURABLES 318,668
PRECIOUS METALS - 0.3%
Barrick Gold Corp. 646,800 19,435
Bre-X Minerals Ltd. 594,600 9,186
Newmont Mining Corp. 84,700 4,055
32,676
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - 9.9%
APPAREL STORES - 1.3%
Baby Superstore, Inc. (a) 618,000 $ 17,150
Footstar, Inc. (a) 136,752 2,803
Gap, Inc. 902,800 29,002
Gymboree Corp. (a) 160,000 4,520
Just for Feet, Inc. (a) 1,332,725 31,486
Limited, Inc. (The) 84,241 1,516
Loehmanns, Inc. (a) 225,300 6,787
Saks Holdings, Inc. (a) 298,200 9,692
TJX Companies, Inc. 533,414 24,070
127,026
DRUG STORES - 0.3%
CVS Corp. 475,000 19,534
General Nutrition Companies, Inc. (a) 384,500 6,633
Revco (D.S.), Inc. (a) 186,200 6,424
32,591
GENERAL MERCHANDISE STORES - 2.4%
Consolidated Stores Corp. (a) 456,000 16,872
Dayton Hudson Corp. 303,000 11,779
Family Dollar Stores, Inc. 716,400 13,433
Federated Department Stores, Inc. (a) 650,000 22,181
Meyer (Fred), Inc. (a) 165,000 5,528
Nordstrom, Inc. 67,300 2,928
Price/Costco, Inc. (a) 805,400 18,726
Sears, Roebuck & Co. 500,000 24,875
Stein Mart, Inc. (a) 166,000 3,175
Wal-Mart Stores, Inc. 4,350,600 110,939
Woolworth Corp. (a) 189,200 4,541
234,977
GROCERY STORES - 0.1%
Safeway, Inc. (a) 139,400 5,663
RETAIL & WHOLESALE, MISCELLANEOUS - 5.8%
Barnes & Noble, Inc. (a) 183,900 5,747
Bed Bath & Beyond, Inc. (a) 654,800 17,148
Circuit City Stores, Inc. 550,000 18,356
Corporate Express, Inc. (a) 751,150 21,032
Home Depot, Inc. (The) 1,614,700 84,166
Lowe's Companies, Inc. 2,875,100 116,801
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
RETAIL & WHOLESALE, MISCELLANEOUS - CONTINUED
Officemax, Inc. (a) 2,055,500 $ 29,805
Office Depot, Inc. (a) 1,021,625 19,922
Petco Animal Supplies, Inc. (a) 62,000 1,356
PETsMART, Inc. (a) 4,200,700 107,118
Sports Authority, Inc. (a) 151,550 3,751
Staples, Inc. (a) 2,900,075 57,276
Sunglass Hut International, Inc. (a) 1,672,400 12,334
Toys "R" Us, Inc. (a) 651,800 22,487
U.S. Office Products Co. (a) 109,200 3,385
Viking Office Products, Inc. (a) 798,500 25,003
Waban, Inc. (a) 296,900 7,831
553,518
TOTAL RETAIL & WHOLESALE 953,775
SERVICES - 1.1%
ADVERTISING - 0.2%
Interpublic Group of Companies, Inc. 144,300 7,143
Omnicom Group, Inc. 116,200 5,926
Universal Outdoor Holdings, Inc. (a) 204,500 5,573
18,642
EDUCATIONAL SERVICES - 0.0%
Sylvan Learning Systems (a) 99,750 2,606
LEASING & RENTAL - 0.1%
Hollywood Entertainment Corp. (a) 671,200 13,508
SERVICES - 0.8%
ADT Ltd. (a) 92,900 1,904
APAC Teleservices, Inc. (a) 214,500 10,135
AccuStaff, Inc. (a) 725,100 14,683
Employee Solutions, Inc. (a) 46,800 866
Medpartners, Inc. (a) 316,400 7,198
Service Corp. International 912,100 27,478
Sitel Corp. (a) 114,900 2,269
Teletech Holdings, Inc. (a) 139,600 4,397
Zebra Technologies Corp. Class A (a) 118,700 3,057
71,987
TOTAL SERVICES 106,743
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - 26.8%
COMMUNICATIONS EQUIPMENT - 4.6%
ADC Telecommunications, Inc. (a) 325,000 $ 11,781
Ascend Communications, Inc. (a) 1,196,100 85,073
Aspect Telecommunications Corp. (a) 252,500 13,761
Checkpoint Systems, Inc. (a) 200,000 4,500
Cisco Systems, Inc. (a) 3,338,400 226,594
Dialogic Corp. (a) 26,200 806
Lucent Technologies, Inc. 601,900 30,847
Nokia Corp. AB sponsored ADR 120,700 6,774
P-COM, Inc. (a) 34,900 1,108
Tellabs, Inc. (a) 357,600 14,215
3Com Corp. (a) 575,000 43,197
U.S. Robotics Corp. (a) 88,800 6,982
445,638
COMPUTER SERVICES & SOFTWARE - 11.5%
Affiliated Computer Services, Inc. Class A (a) 122,400 3,550
America Online, Inc. (a) 350,610 12,403
American Management Systems, Inc. (a) 323,000 11,487
Automatic Data Processing, Inc. 743,400 31,873
BBN Corp. (a) 84,500 1,944
BMC Software, Inc. (a) 470,000 20,445
CUC International, Inc. (a) 5,803,875 153,077
Cadence Design Systems, Inc. (a) 1,034,125 41,236
Ceridian Corp. (a) 366,400 17,633
Citrix Systems, Inc. (a) 79,500 3,627
Computer Associates International, Inc. 568,300 37,366
CompUSA, Inc. (a) 1,219,300 54,869
Computer Sciences Corp. (a) 503,200 39,564
DST Systems, Inc. (a) 65,800 2,130
Electronic Data Systems Corp. 372,200 18,005
Electronics for Imaging, Inc. (a) 248,600 21,131
Equifax Inc. 328,200 10,749
First Data Corp. 614,462 24,502
HBO & Co. 694,500 39,500
Inso Corp. (a) 259,500 11,061
McAfee Associates, Inc. (a) 754,850 36,044
Microsoft Corp. (a) 857,300 134,489
Netscape Communications Corp. (a) 779,700 43,566
Oracle Systems Corp. (a) 4,029,100 197,425
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - CONTINUED
Orckit Communications Ltd. (a) 12,300 $ 138
Parametric Technology Corp. (a) 1,194,300 64,940
Paychex, Inc. 293,500 15,702
PeopleSoft, Inc. (a) 425,000 38,888
Physician Computer Network, Inc. (a) 90,700 748
Remedy Corp. (a) 185,400 8,389
Sabre Group Holdings, Inc. Class A (a) 118,900 3,478
Sybase, Inc. (a) 210,800 3,715
1,103,674
COMPUTERS & OFFICE EQUIPMENT - 5.6%
Adaptec, Inc. (a) 1,756,200 65,418
Bay Networks, Inc. (a) 425,050 11,370
Compaq Computer Corp. (a) 1,115,100 88,372
Dell Computer Corp. (a) 475,400 48,313
EMC Corp. (a) 870,000 28,058
Eltron International, Inc. (a) 124,400 3,856
Gateway 2000, Inc. (a) 67,800 3,636
Hewlett-Packard Co. 555,600 29,933
Ingram Micro, Inc. Class A (a) 157,200 3,871
International Business Machines Corp. 998,300 159,104
Lexmark International Group, Inc. (a) 220,600 5,708
Micron Electronics, Inc. (a) 384,700 7,405
Pitney Bowes, Inc. 300,000 17,700
Quantum Corp. (a) 357,000 9,550
Seagate Technology (a) 1,033,200 40,811
Tech Data Corp. (a) 485,800 14,574
537,679
ELECTRONIC INSTRUMENTS - 0.2%
Applied Materials, Inc. (a) 283,800 10,820
Perkin-Elmer Corp. 123,300 7,598
18,418
ELECTRONICS - 4.7%
Analog Devices, Inc. (a) 500,250 16,071
Atmel Corp. (a) 445,200 14,636
Cascade Communications Corp. (a) 110,400 7,631
Cirrus Logic, Inc. (a) 349,100 6,851
Intel Corp. 2,033,500 258,000
KEMET Corp. (a) 308,300 7,091
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
ELECTRONICS - CONTINUED
Linear Technology Corp. 783,500 $ 36,922
Maxim Integrated Products, Inc. (a) 805,000 37,332
Micron Technology, Inc. 267,200 8,851
Motorola, Inc. 162,600 9,004
S3, Inc. (a) 100,500 1,709
Solectron Corp. (a) 46,600 2,726
Storage Technology Corp. (a) 361,500 18,030
Texas Instruments, Inc. 195,200 12,444
Xilinx, Inc. (a) 243,700 10,692
447,990
PHOTOGRAPHIC EQUIPMENT - 0.2%
Eastman Kodak Co. 293,000 23,733
TOTAL TECHNOLOGY 2,577,132
TRANSPORTATION - 1.0%
AIR TRANSPORTATION - 0.7%
AMR Corp. (a) 300,000 27,374
America West Airlines, Inc. Class B (a) 826,800 12,091
Comair Holdings, Inc. 300,000 7,463
Delta Air Lines, Inc. 58,000 4,365
Midwest Express Holdings, Inc. (a) 5,300 175
UAL Corp. (a) 195,000 11,213
62,681
RAILROADS - 0.3%
CSX Corp. 643,800 30,098
TRUCKING & FREIGHT - 0.0%
Hunt (J.B.) Transport Services, Inc. 194,800 2,727
TOTAL TRANSPORTATION 95,506
UTILITIES - 4.5%
CELLULAR - 1.4%
AirTouch Communications, Inc. (a) 3,385,065 86,743
Arch Communications Group, Inc. (a) 270,200 2,972
Palmer Wireless, Inc. (a) 295,000 4,425
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - CONTINUED
CELLULAR - CONTINUED
360 Degrees Communications Co. (a) 1,150,000 $ 27,313
Vanguard Cellular Systems, Inc. Class A (a) 737,800 12,450
133,903
ELECTRIC UTILITY - 0.0%
Calpine Corp. (a) 284,300 5,117
GAS - 0.2%
Enron Corp. 448,200 20,505
TELEPHONE SERVICES - 2.9%
Ameritech Corp. 315,600 18,581
Bell Atlantic Corp. 291,100 18,303
BellSouth Corp. 734,200 29,643
Cincinnati Bell, Inc. 77,600 4,627
Comsat Corp., Series 1 110,000 2,888
Frontier Corp. 38,800 1,019
LCI International, Inc. (a) 1,089,500 35,545
MCI Communications Corp. 1,258,900 38,396
MFS Communications, Inc. 997,900 48,149
SBC Communications, Inc. 250,100 13,162
Sprint Corp. 395,900 16,578
Telebras sponsored ADR 279,900 21,202
Telefonos de Mexico SA sponsored ADR representing Ord.
Class L shares 296,300 9,000
WorldCom, Inc. (a) 914,600 21,150
278,243
TOTAL UTILITIES 437,768
TOTAL COMMON STOCKS
(Cost $6,510,642) 8,766,015
CASH EQUIVALENTS - 9.0%
Taxable Central Cash Fund (c) (Cost $864,879) 864,878,728 864,879
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $7,375,521) $ 9,630,894
LEGEND
1. Non-income producing
2. Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $4,801,000 or 0.0% of net
assets.
3. At period end, the seven-day yield on the Taxable Central Cash Fund was
5.46%. The yield refers to the income earned by investing in the fund over
the seven-day period, expressed as an annual percentage.
INCOME TAX INFORMATION
At November 30, 1996 the aggregate cost of investment securities for income
tax purposes was $7,398,555,000. Net unrealized appreciation aggregated
$2,232,339,000, of which $2,363,316,000 related to appreciated investment
securities and $130,977,000 related to depreciated investment securities.
The fund hereby designates approximately $91,826,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNT) NOVEMBER 30, 1996
ASSETS
Investment in securities, at value (cost $7,375,521) - $ 9,630,894
See accompanying schedule
Cash 2,733
Receivable for investments sold 22,053
Receivable for fund shares sold 17,877
Dividends receivable 7,072
Interest receivable 2,537
Other receivables 1,188
TOTAL ASSETS 9,684,354
LIABILITIES
Payable for investments purchased $ 52,700
Payable for fund shares redeemed 18,239
Accrued management fee 4,189
Other payables and accrued expenses 2,562
TOTAL LIABILITIES 77,690
NET ASSETS $ 9,606,664
Net Assets consist of:
Paid in capital $ 6,898,271
Undistributed net investment income 76,173
Accumulated undistributed net realized gain (loss) on 376,848
investments and foreign currency transactions
Net unrealized appreciation (depreciation) on 2,255,372
investments and assets and liabilities in foreign
currencies
NET ASSETS, for 220,650 shares outstanding $ 9,606,664
NET ASSET VALUE, offering price and redemption price per $43.54
share ($9,606,664 (divided by) 220,650 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED NOVEMBER 30, 1996
INVESTMENT INCOME $ 78,777
Dividends
Interest (including security lending fees of $3) 65,149
TOTAL INCOME 143,926
EXPENSES
Management fee $ 47,943
Basic fee
Performance adjustment 1,041
Transfer agent fees 18,238
Accounting fees and expenses 814
Non-interested trustees' compensation 28
Custodian fees and expenses 204
Registration fees 888
Audit 84
Legal 64
Miscellaneous 47
Total expenses before reductions 69,351
Expense reductions (1,708) 67,643
NET INVESTMENT INCOME 76,283
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 401,086
Foreign currency transactions (6) 401,080
Change in net unrealized appreciation (depreciation) on:
Investment securities 993,675
Assets and liabilities in foreign currencies (1) 993,674
NET GAIN (LOSS) 1,394,754
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 1,471,037
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED YEAR ENDED
NOVEMBER 30, NOVEMBER 30,
1996 1995
INCREASE (DECREASE) IN NET ASSETS
Operations $ 76,283 $ 33,533
Net investment income
Net realized gain (loss) 401,080 361,315
Change in net unrealized appreciation (depreciation) 993,674 1,122,571
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 1,471,037 1,517,419
FROM OPERATIONS
Distributions to shareholders (23,344) (23,316)
From net investment income
From net realized gain (294,687) (85,845)
TOTAL DISTRIBUTIONS (318,031) (109,161)
Share transactions 5,216,094 3,513,078
Net proceeds from sales of shares
Reinvestment of distributions 315,350 107,914
Cost of shares redeemed (3,263,751) (1,822,602)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 2,267,693 1,798,390
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 3,420,699 3,206,648
NET ASSETS
Beginning of period 6,185,965 2,979,317
End of period (including undistributed net investment $ 9,606,664 $ 6,185,965
income of $76,173 and $23,240, respectively)
OTHER INFORMATION
Shares
Sold 134,851 106,452
Issued in reinvestment of distributions 8,884 4,024
Redeemed (84,075) (54,932)
Net increase (decrease) 59,660 55,544
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30,
1996 1995 1994 E 1993 1992 C
SELECTED PER-SHARE DATA
Net asset value, $ 38.42 $ 28.25 $ 30.91 $ 28.13 $ 25.62
beginning of period
Income from Investment
Operations
Net investment income .34 .20 .12 .07 .13 D
Net realized and unrealized 6.72 11.00 .28 3.99 4.52
gain (loss)
Total from investment 7.06 11.20 .40 4.06 4.65
operations
Less Distributions
From net investment income (.14) H (.22) (.07) (.07) (.10)
From net realized gain (1.80) H (.81) (2.99) (1.21) (2.04)
Total distributions (1.94) (1.03) (3.06) (1.28) (2.14)
Net asset value, end of period $ 43.54 $ 38.42 $ 28.25 $ 30.91 $ 28.13
TOTAL RETURN A, B 19.55% 41.22% 1.23% 15.04% 19.25%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period $ 9,607 $ 6,186 $ 2,979 $ 2,423 $ 1,752
(in millions)
Ratio of expenses to average .88% .96% 1.06% 1.08% 1.09%
net assets
Ratio of expenses to average .85% F .95% 1.05% 1.07% 1.09%
net assets after expense F F F
reductions
Ratio of net investment income .96% .76% .64% .43% .52%
to average net assets
Portfolio turnover rate 78% 97% 135% 159% 250%
Average commission rate G $ .0414
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO
FINANCIAL STATEMENTS).
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE (SEE NOTE 4 OF
NOTES TO FINANCIAL STATEMENTS).
C AS OF DECEMBER 1, 1991 THE FUND DISCONTINUED THE USE OF EQUALIZATION
ACCOUNTING.
D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
E 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, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
F FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 6 OF
NOTES TO FINANCIAL STATEMENTS).
G FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
H THE AMOUNTS SHOWN REFLECT CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO
TAX DIFFERENCES (SEE NOTE 1 OF NOTES TO FINANCIAL STATEMENTS).
NOTES TO FINANCIAL STATEMENTS
For the period ended November 30, 1996
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Growth Company Fund (the fund)is a fund of 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 financial statements have been prepared
in conformity with generally accepted accounting principles which permit
management to make certain estimates and assumptions at the date of the
financial statements. The following summarizes the significant accounting
policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are readily
available are valued at the last sale price, or if no sale price, at the
closing bid price. Securities (including restricted securities) for which
exchange quotations are not readily available (and in certain cases debt
securities which trade on an exchange) are valued primarily using
dealer-supplied valuations or at their fair value as determined in good
faith under consistently applied procedures under the general supervision
of the Board of Trustees. Short-term securities with remaining maturities
of sixty days or less for which quotations are not readily available are
valued at amortized cost or original cost plus accrued interest, both of
which approximate current value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Income receipts
and expense payments are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and
sales of securities are translated into U.S. dollars at the contractual
currency exchange rates established at the time of each trade.
Net realized gains and losses on foreign currency transactions represent
net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, and the difference between
the amount of net investment income accrued and the U.S. dollar amount
actually received. The effects of changes in foreign currency exchange
rates on investments in securities are included with the net realized and
unrealized gain or loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes substantially all of its taxable income for
its fiscal year. The schedule of investments includes information regarding
income taxes under the caption "Income Tax Information."
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. Non-cash dividends included in dividend income,
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
if any, are recorded at the fair market value of the securities received.
Interest income is accrued as earned. Investment 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.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for litigation
proceeds and losses deferred due to wash sales. The fund also utilized
earnings and profits distributed to shareholders on redemption of shares as
a part of the dividends paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect 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 and
foreign currency
transactions may include temporary book and tax basis differences which
will reverse in a subsequent period. Any taxable income or gain remaining
at fiscal year end is distributed in the following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign securities. Losses may
arise from changes in the value of the foreign currency or if the
counterparties do not perform under the contracts' terms. The U.S. dollar
value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), the fund, 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 for U.S. Treasury or
Federal Agency obligations.
2. OPERATING POLICIES -
CONTINUED
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account, at a bank custodian. The securities are marked-to-market
daily and maintained at a value at least equal to the principal amount of
the repurchase agreement (including accrued interest). FMR, the fund's
investment adviser, is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by the
SEC, the fund may invest in the Taxable Central Cash Fund (the Cash Fund)
managed by FMR. The Cash Fund is an open-end money market fund available
only to investment companies and other accounts managed by FMR and its
affiliates. The Cash Fund seeks preservation of capital, liquidity, and
current income by investing in U.S. Treasury securities and repurchase
agreements for these securities, and may be utilized by the fund as an
additional cash management option. Dividends from the Cash Fund are
declared daily and paid monthly from net interest income. Income
distributions received by the fund are recorded as interest income.
RESTRICTED SECURITIES. The fund is permitted to invest in securities that
are subject to legal or contractual restrictions on resale. These
securities generally may be resold in transactions exempt from registration
or to the public if the securities are registered. Disposal of these
securities may involve time-consuming negotiations and expense, and prompt
sale at an acceptable price may be difficult. At the end of the period, the
fund had no investments in restricted securities (excluding 144A issues).
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $7,137,026,000 and $5,309,570,000, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
basic fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR. The
rates ranged from .2500% to .5200% for the period. In the event that these
rates were lower than the contractual rates in effect during the period,
FMR voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. The annual individual fund fee rate is .30%. The
basic fee is subject to a performance adjustment (up to a maximum of
(plus/minus) .20% of the fund's average net assets) over the performance
period based on the fund's investment performance as compared to the
appropriate index over a specified
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
MANAGEMENT FEE - CONTINUED
period of time. For the period, the management fee was equivalent to an
annual rate of .62% of average net assets after the performance adjustment.
SALES LOAD. For the period January 1, 1995 through December 31, 1996,
Fidelity Distributors Corporation, an affiliate of FMR and the general
distributor of the fund, voluntarily waived the sales charge (3% of the
offering price) on the sales of shares. Effective January 1, 1997 the
fund's 3% sales charge will be eliminated.
TRANSFER AGENT FEES. Fidelity Service Co. (FSC), an affiliate of FMR, is
the fund's transfer, dividend disbursing and shareholder servicing agent.
FSC receives account fees and asset-based fees that vary according to
account size and type of account. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annual rate of .23%
of average net assets.
ACCOUNTING AND SECURITY LENDING FEES. FSC maintains the fund's accounting
records and administers the security lending program. The security lending
fee is based on the number and duration of lending transactions. The
accounting fee is based on the level of average net assets for the month
plus out-of-pocket expenses.
BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid to these affiliated firms were $1,704,000 for the period.
5. SECURITY LENDING.
The fund loaned securities to certain brokers who paid the fund negotiated
lenders' fees. These fees are included in interest income. The fund
receives U.S. Treasury obligations and/or cash as collateral against the
loaned securities, in an amount at least equal to 102% of the market value
of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 100% of the market value of the loaned
securities during the period of the loan. At period end, there were no
loans outstanding.
6. EXPENSE REDUCTIONS.
FMR has directed certain portfolio trades to brokers who paid a portion of
the fund's expenses. For the period, the fund's expenses were reduced by
$1,038,000 under this arrangement.
In addition, the fund has entered into arrangements with its custodian and
transfer agent whereby interest earned on uninvested cash balances was used
to offset a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $13,000 and $657,000,
respectively, under these arrangements.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Mt. Vernon Street Trust and the Shareholders of
Fidelity Growth Company Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Mt. Vernon Street Trust: Fidelity Growth Company Fund, including
the schedule of portfolio investments, as of November 30, 1996, and the
related statement of operations for the year then ended, the statement of
changes in net assets for each of the two years in the period then ended
and the financial highlights for each of the five years in the period then
ended. These financial statements and financial highlights are the
responsibility of the fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of November 30, 1996 by correspondence with the
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Mt. Vernon Street Trust: Fidelity Growth Company Fund as of
November 30, 1996, the results of its operations for the year then ended,
the changes in its net assets for each of the two years in the period then
ended, and the financial highlights for each of the five years in the
period then ended, in conformity with generally accepted accounting
principles.
/s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
January 3, 1997
DISTRIBUTIONS
The Board of Trustees of Fidelity Growth Company Fund voted to pay to
shareholders of record at the opening of business on record date, the
following distributions derived from capital gains realized from sales of
portfolio securities, and dividends derived from net investment income:
PAY DATE RECORD DATE DIVIDENDS CAPITAL GAINS
12/16/96 12/13/96 $.28 $1.39
1/6/97 1/3/97 $.00 $.07
A total of 2.95% of the dividends distributed during the fiscal year was
derived from interest on U.S. government securities which is generally
exempt from state income tax.
A total of 16% of the dividends distributed during the fiscal year
qualifies for the dividends-received deduction for corporate shareholders.
The fund will notify shareholders in January 1997 of these percentages for
use in preparing 1996 income tax returns.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a day.
BY PHONE
Fidelity TouchTone Xpressprovides a single toll-free number to access
account balances, positions, quotes and trading. It's easy to navigate the
service, and on your first call, the system will help you create a personal
identification number (PIN) for security.
SM
(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
1
For quotes.*
2
For account balances and holdings.
3
To review orders and mutual
fund activity.
4
To change your PIN.
5
To speak to a Fidelity representative.
*
0
BY PC
Fidelity's Web site on the Internet provides a wide range of information,
including daily financial news, fund performance, interactive planning
tools and news about Fidelity products and services.
(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at 1-800-544-7272
for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity at
1-800-544-7272 or visit our Web site for more information on how to manage
your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT
IN A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and send
you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
100 Crosby Parkway - KP2C
Covington, KY 41015-4399
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6I
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
851 East Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
811 Wilshire Boulevard
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
950 Northgate Drive
San Rafael, CA
1400 Civic Drive
Walnut Creek, CA
6300 Canoga Avenue
Woodland Hills, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
29 South Main Street
West Hartford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
90 Alhambra Plaza
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
4001 Tamiami Trail, North
Naples, FL
1907 West State Road 434
Orlando, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
2000 66th Street, North
St. Petersburg, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
One North Franklin
Chicago, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
3232 Lake Avenue
Wilmette, IL
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
44 Mall Road
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
29155 Northwestern Hwy.
Southfield, MI
MINNESOTA
7600 France Avenue South
Edina, MN
MISSOURI
700 West 47th Street
Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
56 South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
505 Millburn Avenue
Short Hills, NJ
NEW YORK
1050 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
1271 Avenue of the
Americas
New York, NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
10 Bank Street
White Plains, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
1903 East Ninth Street
Cleveland, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
Dallas, TX
1155 Dairy Ashford
Houston, TX
2701 Drexel Drive
Houston, TX
1010 Lamar Street
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
UTAH
215 South State Street
Salt Lake City, UT
VERMONT
199 Main Street
Burlington, VT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
511 Pine Street
Seattle, WA
WASHINGTON, DC
1775 K Street, N.W.
Washington, DC
WISCONSIN
595 North Barker Road
Brookfield, WI
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Lawrence Greenberg, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Robert H. Morrison, Manager,
Security Transactions
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
ADVISORY BOARD
William O. McCoy
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co., Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
FIDELITY'S GROWTH FUNDS
Blue Chip Growth Fund
Capital Appreciation Fund
Contrafund
Disciplined Equity Fund
Dividend Growth Fund
Emerging Growth Fund
Export Fund
Fidelity Fifty
Growth Company Fund
Large Cap Stock Fund
Low-Priced Stock Fund
Magellan(registered trademark) Fund
Mid-Cap Stock Fund
New Millennium(trademark) Fund
OTC Portfolio
Retirement Growth Fund
Small Cap Stock Fund
Stock Selector
Trend Fund
Value Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE
(2_FIDELITY_LOGOS)FIDELITY
EMERGING GROWTH
FUND
ANNUAL REPORT
NOVEMBER 30, 1996
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 6 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 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 22 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 26 Notes to the financial statements.
REPORT OF INDEPENDENT 30 The auditors' opinion.
ACCOUNTANTS
DISTRIBUTIONS 31
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE
PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND MONEY.
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
Although stocks have managed to post solid returns throughout 1996, signs
of strength in the economy have led to inflation fears, causing some
uncertainty in both the stock and bond markets so far this year. In 1995,
both stock and bond markets posted strong results, while the year before,
stocks posted below-average returns and bonds had one of the worst years in
history.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
If you can leave your money invested over the long term, you can avoid the
results of the volatility that generally accompanies the stock market in
the short term. You also can help to manage some of the risks of investing
through diversification. A stock fund is already diversified because it
invests in many issues. You can diversify even further by placing some of
your money in several different types of stock funds or in other investment
categories, such as bonds.
If you have a short investment time horizon, you might want to consider
moving some of your investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
Finally, no matter what your investment horizon or portfolio diversity, it
makes good sense to follow a regular investment plan - investing a certain
amount of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
If you have any questions, please call us at 1-800-544-8888. We stand ready
to provide the information you need to make the investments that are right
for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. A fund's total
return includes changes in share price, plus reinvestment of any dividends
(or income) and capital gains (the profits the fund earns when it sells
securities that have grown in value).
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1996 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Emerging Growth 13.27% 139.50% 254.70%
Emerging Growth (including 3% sales 9.87% 132.32% 244.06%
charge)
Russell 2000(registered trademark) 16.51% 117.65% 197.78%
Mid-Cap Funds Average 19.21% 115.43% n/a
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, five years, or since the fund
started on December 28, 1990. 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. Total return figures do not include the effect of the 0.75%
redemption fee on shares held less than 90 days. You can compare the fund's
returns to the performance of the Russell 2000 Index - an unmanaged index
of 2,000 small capitalization stocks with market values of $250 million or
less. To measure how the fund's performance stacked up against its peers,
you can compare it to the mid-cap funds average, which reflects the
performance of 148 mutual funds with similar objectives tracked by Lipper
Analytical Services, Inc. over the past 12 months. Both benchmarks include
reinvested dividends and capital gains, if any, and exclude the effects of
sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1996 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Emerging Growth 13.27% 19.09% 23.79%
Emerging Growth (including 3% sales
charge) 9.87% 18.36% 23.16%
Russell 2000 16.51% 16.83% 20.20%
Mid-Cap Funds Average 19.21% 16.45% 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
IMAHDR PRASUN SHR__CHT 19961130 19961206 145306 S00000000000001
Emerging Growth RS Russell 2000
00324 RS002
1990/12/28 9700.00 10000.00
1990/12/31 9758.20 10118.31
1991/01/31 11203.50 11033.34
1991/02/28 11804.90 12263.72
1991/03/31 12648.80 13126.95
1991/04/30 12580.90 13093.92
1991/05/31 13434.50 13718.05
1991/06/30 12493.60 12918.61
1991/07/31 13754.60 13371.94
1991/08/31 14647.00 13866.90
1991/09/30 14753.70 13975.48
1991/10/31 14967.10 14345.11
1991/11/30 14365.70 13681.63
1991/12/31 16305.88 14777.18
1992/01/31 16354.92 15974.53
1992/02/29 16104.38 16440.53
1992/03/31 15072.18 15884.04
1992/04/30 14621.22 15327.56
1992/05/31 14801.60 15531.38
1992/06/30 14060.02 14796.86
1992/07/31 14741.47 15311.50
1992/08/31 14280.49 14879.43
1992/09/30 14731.45 15222.82
1992/10/31 15753.63 15706.69
1992/11/30 16956.20 16908.56
1992/12/31 17668.44 17497.62
1993/01/31 18231.12 18089.85
1993/02/28 17527.13 17672.04
1993/03/31 18034.42 18245.49
1993/04/30 17899.83 17744.65
1993/05/31 19463.09 18529.84
1993/06/30 19659.79 18645.43
1993/07/31 19587.32 18902.86
1993/08/31 20343.07 19719.50
1993/09/30 20664.00 20275.98
1993/10/31 21160.93 20797.86
1993/11/30 20322.36 20113.33
1993/12/31 21180.19 20801.02
1994/01/31 21797.79 21453.20
1994/02/28 21673.66 21375.61
1994/03/31 20519.22 20247.03
1994/04/30 20606.11 20367.37
1994/05/31 19811.66 20138.67
1994/06/30 18421.37 19454.83
1994/07/31 19116.51 19774.47
1994/08/31 20519.22 20876.35
1994/09/30 20419.91 20806.45
1994/10/31 21400.57 20724.34
1994/11/30 20581.29 19887.35
1994/12/31 21142.37 20421.66
1995/01/31 20582.39 20164.00
1995/02/28 21540.58 21002.81
1995/03/31 22448.99 21364.52
1995/04/30 23208.08 21839.57
1995/05/31 24166.27 22215.08
1995/06/30 26841.73 23367.51
1995/07/31 30002.51 24713.52
1995/08/31 30425.60 25224.78
1995/09/30 31134.91 25675.24
1995/10/31 30761.59 24526.99
1995/11/30 30375.83 25557.48
1995/12/31 28741.54 26231.80
1996/01/31 29135.09 26203.68
1996/02/29 30883.45 27020.31
1996/03/31 30883.45 27570.34
1996/04/30 32853.63 29044.56
1996/05/31 34132.28 30189.13
1996/06/30 32827.53 28949.46
1996/07/31 29604.80 26420.91
1996/08/31 30857.36 27954.92
1996/09/30 33492.95 29047.38
1996/10/31 32631.82 28599.70
1996/11/29 34406.28 29778.13
IMATRL PRASUN SHR__CHT 19961130 19961206 145308 R00000000000075
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Emerging Growth Fund on December 28, 1990, when the
fund started, and the maximum 3% sales charge was paid. As the chart shows,
by November 30, 1996, the value of the investment would have grown to
$34,406 - a 244.06% increase on the initial investment. For comparison,
look at how the Russell 2000 Index did over the same period. With dividends
reinvested, the same $10,000 investment would have grown to $29,778 - a
197.78% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Paced by the robust performance
of blue chip stocks, the U.S. stock
market posted strong gains for
the year that ended November
30, 1996. The Standard & Poor's
500 Index returned 27.86%
during the period - well above its
long-term average of about 12%.
The stock market spent much of
the past year breaking price and
trading volume records. Solid
corporate earnings reports, large
cash inflows into mutual funds,
widespread optimism and a
generally favorable interest rate
environment propelled share
prices higher. Large capitalization
stocks thrived as investors
sought their lower volatility and
higher degree of liquidity over
smaller cap stocks in an
environment where it was
sometimes difficult to discern the
health of the economy. The Dow
Jones Industrial Average closed
above 6500 for the first time in
November. While short-term
confusion over the direction of
interest rates created a volatile
backdrop in the summer months,
stocks rallied again when the
Federal Reserve Board left
short-term interest rates
unchanged and it appeared
inflation would not be an issue for
the remainder of 1996.
Smaller-company stocks posted
strong gains at the beginning of
1996, but trended downward in
the spring and summer because
their earnings tend to be more
affected by the higher borrowing
costs brought on by higher rates.
When interest rate fears
subsided, these stocks
rebounded, only to fade toward
the end of the period due to
earnings concerns and a general
flight to quality.
An interview with Larry Greenberg, Portfolio Manager of Fidelity Emerging
Growth Fund
Q. WHAT CAN YOU TELL US ABOUT THE FUND'S PERFORMANCE, LARRY?
A. For the one-year period that ended November 30, 1996, the fund had a
total return of 13.27%. Additionally, the Russell 2000 index returned
16.51% and the return of the mid-cap funds average, according to Lipper
Analytical Services, was 19.21%.
Q. WHY DO YOU THINK THE FUND UNDERPERFORMED?
A. I think there were two major reasons. First, the fund's underperformance
in the past year is reflective of the underperformance of technology stocks
earlier in the period, which hurt many growth-oriented investors if they
sold these stocks. Second, the stock market has been led by financial and
energy companies. By definition, this type of fund will not own many of
these kinds of stocks because many of them represent mature industries
rather than emerging growth industries.
Q. HOW IS THE FUND POSITIONED IN TECHNOLOGY-RELATED COMPANIES? WERE THERE
ANY THEMES YOU FOLLOWED?
A. I focused the fund's technology weighting in what I call the "Nasdaq
Four" - Intel, Microsoft, Cisco Systems and Oracle. In the technology
arena, we've seen the bigger firms getting bigger at the expense of small
firms, which are finding it harder and harder to gain market share.
Additionally, the Nasdaq Four were well-positioned to benefit from two
major trends during the period - growth of the Internet and growth in
personal computers.
Q. DECLINING SEMICONDUCTOR PRICES HAVE HURT THAT INDUSTRY OVER THE PAST
YEAR. ARE THERE ANY RECENT DEVELOPMENTS IN THIS SITUATION?
A. Semiconductor prices have stabilized following a freefall for much of
this past year. An oversupply in the market continues, but demand has
picked up as some companies have been able to work through their excess
inventories.
Q. WHAT WAS THE STORY BEHIND THE FUND'S HEALTH CARE POSITION?
A. In my opinion, one of the most intriguing parts of the health care
market has been the pharmaceutical area. It was one segment of the market
where business fundamentals improved steadily throughout the year. With the
proliferation of managed care, we've seen strong unit demand for drugs. For
example, in the third quarter of 1996, Merck had a phenomenal 25% unit
growth in their domestic pharmaceutical business. In general, I looked for
companies with accelerated earnings momentum, good year-over-year earnings
growth and strong revenue growth that were trading at reasonable prices.
Q. HOW ABOUT RETAIL?
A. I think we may be seeing a stabilization of certain sectors of retail.
If you look at the past three years, consumer demand was pretty poor. In
the past year, however, we've seen demand picking up and the beginning of a
turnaround in the earnings growth rates of some major retailers. I targeted
specialty retailers considered to be "category killers" - companies that
dominate their market segment no matter what is happening in the overall
retail market or the economy. One example of a category killer was
PETsMART.
Q. WAS THERE A PARTICULAR STOCK THAT DIDN'T LIVE UP TO EXPECTATIONS?
A. While category-killer retail stocks can be great growth companies, they
can be quite volatile as well. Such was the case with Sunglass Hut
International, whose revenue growth and earnings rapidly deteriorated
during the period. Although I was able to significantly reduce the fund's
position in the stock, I was not able to eliminate it completely. Thus, the
fund sustained some losses.
Q. HOW ARE YOU POSITIONING THE FUND GOING FORWARD?
A. Obviously, the stock market has had quite a run, and we have enjoyed a
long economic expansion. In this environment, I'm trying to reduce some of
the risk in the fund by spreading its assets over a variety of industries
and stocks that haven't gone up as much as the overall market. While this
strategy does not eliminate risk in the fund, I believe it's the best
course of action in an uncertain time.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: to increase the value
of the fund's shares by
investing in stocks of
companies that Fidelity
believes are in the
developing stage of their life
cycle and offer the potential
for accelerated growth
FUND NUMBER: 324
TRADING SYMBOL: FDEGX
START DATE: December
28, 1990
SIZE: as of November 30,
1996, more than $1.9 billion
MANAGER: Larry Greenberg,
since 1993; manager,
Fidelity Growth Company
Fund, since June 1996;
manager, Fidelity Advisor
Equity Growth Fund, since
June 1996; manager, VIP:
Growth Portfolio, since 1991;
joined Fidelity in 1986
(checkmark)
LARRY GREENBERG ON
COMPETITION IN HIGH
TECH INDUSTRIES:
"Much is discussed in the
financial press about the
intense competition in certain
segments of high tech. While
these corporate wars make
good news stories, they are
often oversimplified and
blown out of proportion. For
example, there's been a lot
of attention in the media
devoted to the "browser war"
between Netscape and
Microsoft. While Internet
browsers are Netscape's
best-known product, the
company generates most of
its revenues from corporate
applications of Internet
technology - not browsers.
"Another issue is whether
microprocessor-maker Intel
can maintain its dominance in
the face of new competition.
While it has some notable
competitors in a rapidly
changing market, people
often forget Intel's industry
clout, its vast R&D budget
and marketing strength, and
its ability to maintain
aggressive pricing."
NOTE TO SHAREHOLDERS:
Effective January 7, 1997,
John K. Hurley became
manager of the fund. Hurley
joined Fidelity in 1993 and has
worked as an analyst and
manager.
INVESTMENT CHANGES
TOP TEN STOCKS AS OF NOVEMBER 30, 1996
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO
Intel Corp. 3.8 1.5
Cisco Systems, Inc. 3.7 3.4
Oracle Systems Corp. 3.4 2.4
HFS, Inc. 2.8 2.4
CUC International, Inc. 2.2 1.3
Microsoft Corp. 2.1 1.5
International Business
Machines Corp. 1.8 0.0
Ascend Communications, Inc. 1.7 3.0
PETsMART, Inc. 1.6 1.5
Compaq Computer Corp. 1.4 0.2
TOP FIVE MARKET SECTORS AS OF NOVEMBER 30, 1996
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET SECTORS
6 MONTHS AGO
Technology 46.8 39.8
Health 13.6 13.7
Retail & Wholesale 11.4 12.3
Media & Leisure 8.3 8.6
Utilities 5.2 6.5
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF NOVEMBER 30, 1996 * AS OF MAY 31, 1996 **
Row: 1, Col: 1, Value: 2.8
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 48.6
Row: 1, Col: 4, Value: 48.6
Row: 1, Col: 1, Value: 7.9
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 42.1
Row: 1, Col: 4, Value: 50.0
Stocks 97.2%
Short-term
investments 2.8%
FOREIGN
INVESTMENTS 3.0%
Stocks 92.1%
Short-term
investments 7.9%
FOREIGN
INVESTMENTS 1.9%
*
**
INVESTMENTS NOVEMBER 30, 1996
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 97.2%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 0.2%
Orbital Sciences Corp. (a) 225,000 $ 4,359
BASIC INDUSTRIES - 0.6%
CHEMICALS & PLASTICS - 0.1%
Airgas, Inc. (a) 65,800 1,694
IRON & STEEL - 0.1%
Nucor Corp. 35,000 1,903
METALS & MINING - 0.3%
Oregon Metallurgical Corp. 85,000 3,018
Titanium Metals Corp. (a) 110,000 3,685
6,703
PACKAGING & CONTAINERS - 0.1%
Tupperware Corp. 30,000 1,590
TOTAL BASIC INDUSTRIES 11,890
CONSTRUCTION & REAL ESTATE - 0.8%
CONSTRUCTION - 0.4%
Oakwood Homes Corp. 326,900 7,233
ENGINEERING - 0.4%
MasTec, Inc. (a) 165,000 7,796
TOTAL CONSTRUCTION & REAL ESTATE 15,029
DURABLES - 2.2%
AUTOS, TIRES, & ACCESSORIES - 0.4%
AutoZone, Inc. (a) 315,000 7,757
CONSUMER DURABLES - 0.2%
Spectran Corp. (a) 130,000 2,291
Wireless Telecom Group, Inc. 129,800 1,298
3,589
CONSUMER ELECTRONICS - 0.2%
Harman International Industries, Inc. 75,000 3,825
HOME FURNISHINGS - 0.1%
Furniture Brands International, Inc. (a) 100,000 1,238
TEXTILES & APPAREL - 1.3%
Adidas AG (b) 14,400 1,245
Adidas AG 17,200 1,488
Gucci Group NV 50,000 3,669
Mohawk Industries, Inc. (a) 69,300 1,650
NIKE, Inc. Class B 210,000 11,944
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
DURABLES - CONTINUED
TEXTILES & APPAREL - CONTINUED
Timberland Co. Class A (a) 10,500 $ 407
Tommy Hilfiger (a) 50,000 2,700
Wolverine World Wide, Inc. 115,050 3,092
26,195
TOTAL DURABLES 42,604
ENERGY - 1.4%
INDEPENDENT POWER - 0.3%
Thermo Electron Corp. (a) 130,000 4,712
OIL & GAS - 1.1%
Abacan Resource Corp. (a) 88,200 755
Barrett Resources Corp. (a) 115,000 4,686
Belco Oil & Gas Corp. (a) 31,000 883
Benton Oil & Gas Co. (a) 90,000 2,295
Chesapeake Energy Corp. (a) 117,000 7,649
Louisiana Land & Exploration Co. 50,000 2,988
Noble Affiliates, Inc. 60,000 2,828
22,084
TOTAL ENERGY 26,796
FINANCE - 0.5%
CREDIT & OTHER FINANCE - 0.3%
Aames Financial Corp. 50,000 2,144
Concord EFS, Inc. (a) 4,000 116
Green Tree Financial Corp. 65,000 2,722
PHH Corp. 20,500 920
5,902
SECURITIES INDUSTRY - 0.2%
Schwab (Charles) Corp. 100,000 3,013
TOTAL FINANCE 8,915
HEALTH - 13.6%
DRUGS & PHARMACEUTICALS - 6.9%
Alkermes, Inc. (a) 100,000 1,412
ALZA Corp. Class A (a) 90,000 2,542
American Home Products Corp. 105,000 6,746
Amgen, Inc. (a) 75,000 4,566
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
DRUGS & PHARMACEUTICALS - CONTINUED
Biochem Pharmaceuticals, Inc. (a) 90,000 $ 3,848
Biogen, Inc. (a) 325,000 12,431
Bristol-Myers Squibb Co. 135,000 15,356
COR Therapeutics, Inc. (a) 175,000 1,859
Dura Pharmaceuticals, Inc. (a) 50,000 1,850
Elan Corp. PLC ADR (a) 100,000 2,975
Genentech, Inc. special (a) 120,000 6,495
Genome Therapeutics Corp. (a) 150,000 1,350
Guilford Pharmaceuticals, Inc. (a) 75,000 1,322
Lifecore Biomedical, Inc. (a) 10,000 158
Lilly (Eli) & Co. 90,000 6,885
Merck & Co., Inc. 275,000 22,825
Nabi (a) 85,000 776
PerSeptive Biosystems, Inc. (a) 1,194 8
PerSeptive Biosystems, Inc. Class G (warrants) (a) 675 -
Pfizer, Inc. 175,000 15,684
Protein Design Labs, Inc. (a) 100,000 2,388
Schering-Plough Corp. 155,000 11,044
Sepracor, Inc. (a) 75,000 1,247
Sequus Pharmaceuticals, Inc. (a) 85,000 1,222
SmithKline Beecham PLC ADR 128,600 8,857
Thermotrex Corp. (a) 31,400 1,068
134,914
MEDICAL EQUIPMENT & SUPPLIES - 2.9%
Bergen Brunswig Corp. Class A 160,000 4,360
Biopsys Medical, Inc. (a) 73,500 1,746
Boston Scientific Corp. (a) 95,000 5,545
Cardinal Health, Inc. 69,800 5,837
Johnson & Johnson 270,000 14,344
Medtronic, Inc. 190,000 12,564
Pall Corp. 100,000 2,612
St. Jude Medical, Inc. (a) 115,000 4,801
Sofamor/Danek Group, Inc. (a) 54,000 1,519
Sybron International, Corp. (a) 85,000 2,582
55,910
MEDICAL FACILITIES MANAGEMENT - 3.8%
American Medical Response, Inc. (a) 95,000 2,850
Carematrix Corp. (a) 106,600 1,466
Columbia/HCA Healthcare Corp. 247,500 9,900
HEALTHSOUTH Rehabilitation Corp. (a) 590,000 22,199
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
MEDICAL FACILITIES MANAGEMENT - CONTINUED
Health Images, Inc. 175,000 $ 2,734
Lincare Holdings, Inc. (a) 116,400 4,627
Medquist, Inc. (a) 175,000 3,369
National Surgery Centers, Inc. 115,000 3,651
Oxford Health Plans, Inc. (a) 175,000 10,150
PacifiCare Health Systems, Inc. Class B (a) 78,700 6,532
Phymatrix Corp. (a) 125,000 1,922
United HealthCare Corp. 100,000 4,312
Vencor, Inc. (a) 50,675 1,641
75,353
TOTAL HEALTH 266,177
INDUSTRIAL MACHINERY & EQUIPMENT - 1.3%
ELECTRICAL EQUIPMENT - 0.2%
AML Communications, Inc. (a) 125,000 1,750
American Power Conversion Corp. (a) 85,000 2,013
Duracell International, Inc. 10,000 666
4,429
INDUSTRIAL MACHINERY & EQUIPMENT - 1.0%
DT Industries, Inc. 65,000 2,251
Ionics, Inc. (a) 232,000 11,194
MSC Industrial Direct, Inc. (a) 25,000 934
PRI Automation, Inc. (a) 100,000 4,775
19,154
POLLUTION CONTROL - 0.1%
USA Waste Services, Inc. (a) 75,000 2,419
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 26,002
MEDIA & LEISURE - 8.3%
BROADCASTING - 0.5%
Clear Channel Communications, Inc. (a) 20,000 1,380
Evergreen Media Corp. Class A (a) 139,700 3,458
PanAmSat Corp. (a) 150,000 4,313
Sinclair Broadcast Group, Inc. Class A (a) 54,200 1,314
10,465
ENTERTAINMENT - 0.3%
MGM Grand, Inc. (a) 70,000 2,704
Regal Cinemas, Inc. (a) 82,500 2,691
5,395
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - CONTINUED
LEISURE DURABLES & TOYS - 0.4%
Harley-Davidson, Inc. 95,000 $ 4,216
Nintendo Co. Ltd. Ord. 32,000 2,266
Travis Boats & Motors, Inc. (a) 185,000 2,336
8,818
LODGING & GAMING - 4.7%
Anchor Gaming (a) 80,000 3,340
Circus Circus Enterprises, Inc. (a) 235,000 8,577
Extended Stay America, Inc. (a) 100,000 2,075
HFS, Inc. (a) 850,000 55,038
Mirage Resorts, Inc. (a) 500,000 12,063
Penske Motorsports, Inc. (a) 6,800 208
Studio Plus Hotels, Inc. (a) 150,000 2,625
Sun International Hotels Ltd. Ord. (a) 115,000 5,707
Wyndham Hotel Corp. (a) 71,500 1,403
91,036
RESTAURANTS - 2.4%
Apple South, Inc. 228,500 3,370
Applebee's International, Inc. 115,000 3,349
CKE Restaurants, Inc. 64,100 1,963
Landry's Seafood Restaurants, Inc. (a) 235,000 5,640
Logan's Roadhouse, Inc. (a) 120,000 2,370
Lone Star Steakhouse & Saloon, Inc. (a) 255,900 7,325
Outback Steakhouse, Inc. (a) 62,500 1,805
Planet Hollywood International, Inc. Class A (a) 160,000 3,680
Rainforest Cafe, Inc. (a) 290,000 8,483
Starbucks Corp. (a) 250,000 8,656
46,641
TOTAL MEDIA & LEISURE 162,355
NONDURABLES - 0.8%
BEVERAGES - 0.0%
Pete's Brewing Co. (a) 90,000 607
HOUSEHOLD PRODUCTS - 0.8%
Gillette Co. 132,500 9,772
Memtec Ltd. sponsored ADR 100,000 3,350
USA Detergents, Inc. (a) 35,000 1,330
14,452
TOTAL NONDURABLES 15,059
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
PRECIOUS METALS - 0.5%
Bre-X Minerals Ltd. 175,000 $ 2,704
Getchell Gold Corp. (a) 76,000 2,974
Newmont Mining Corp. 85,000 4,069
9,747
RETAIL & WHOLESALE - 11.4%
APPAREL STORES - 1.1%
Gap, Inc. 175,000 5,622
Just for Feet, Inc. (a) 635,700 15,018
Loehmanns, Inc. (a) 48,000 1,446
22,086
DRUG STORES - 0.3%
General Nutrition Companies, Inc. (a) 112,300 1,937
Revco (D.S.), Inc. (a) 100,000 3,450
5,387
GENERAL MERCHANDISE STORES - 1.9%
Consolidated Stores Corp. (a) 120,000 4,440
Family Dollar Stores, Inc. 185,000 3,469
Stein Mart, Inc. (a) 176,000 3,366
Wal-Mart Stores, Inc. 1,000,000 25,500
36,775
GROCERY STORES - 0.1%
Central Garden & Pet Co. 100,000 2,162
RETAIL & WHOLESALE, MISCELLANEOUS - 8.0%
Barnes & Noble, Inc. (a) 66,800 2,087
Bed Bath & Beyond, Inc. (a) 200,200 5,243
Corporate Express, Inc. (a) 250,000 7,000
Gadzooks, Inc. (a) 150,000 4,275
Home Depot, Inc. (The) 397,500 20,720
Lowe's Companies, Inc. 635,000 25,797
Officemax, Inc. (a) 600,600 8,709
Office Depot, Inc. (a) 315,075 6,144
Petco Animal Supplies, Inc. (a) 35,300 772
PETsMART, Inc. (a) 1,250,000 31,875
Sodak Gaming, Inc. (a) 270,000 4,320
Sports Authority, Inc. (a) 90,050 2,229
Staples, Inc. (a) 625,000 12,344
Sunglass Hut International, Inc. (a) 909,000 6,704
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
RETAIL & WHOLESALE, MISCELLANEOUS - CONTINUED
Toys "R" Us, Inc. (a) 247,700 $ 8,545
U.S. Office Products Co. (a) 75,000 2,325
Viking Office Products, Inc. (a) 240,000 7,515
156,604
TOTAL RETAIL & WHOLESALE 223,014
SERVICES - 3.4%
ADVERTISING - 0.3%
CMG Information Services, Inc. (a) 83,400 1,324
Snyder Communications, Inc. (a) 75,000 1,828
Universal Outdoor Holdings, Inc. (a) 75,000 2,044
5,196
EDUCATIONAL SERVICES - 0.3%
Sylvan Learning Systems (a) 200,000 5,225
LEASING & RENTAL - 0.9%
Hollywood Entertainment Corp. (a) 650,000 13,081
Movie Gallery, Inc. (a) 133,900 1,875
Team Rental Group, Inc. Class A (a) 123,300 2,004
16,960
SERVICES - 1.9%
ADT Ltd. (a) 25,000 512
APAC Teleservices, Inc. (a) 78,800 3,723
AccuStaff, Inc. (a) 200,450 4,059
Corestaff, Inc. (a) 75,000 1,922
Employee Solutions, Inc. (a) 25,000 463
Medaphis Corp. (a) 160,000 1,660
Medpartners, Inc. (a) 100,000 2,275
Personnel Group of America, Inc. (a) 50,000 1,131
Premier Technologies, Inc. (a) 198,400 4,613
Service Corp. International 210,000 6,326
Sitel Corp. (a) 175,000 3,456
Telespectrum Worldwide, Inc. (a) 260,000 4,615
Teletech Holdings, Inc. (a) 55,000 1,733
Zebra Technologies Corp. Class A (a) 44,000 1,133
37,621
TOTAL SERVICES 65,002
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - 46.8%
COMMUNICATIONS EQUIPMENT - 8.2%
ADC Telecommunications, Inc. (a) 80,000 $ 2,900
Ascend Communications, Inc. (a) 470,200 33,443
Aspect Telecommunications Corp. (a) 76,600 4,175
Checkpoint Systems, Inc. (a) 75,000 1,687
Cisco Systems, Inc. (a) 1,075,000 72,966
Davox Corp. (a) 65,000 2,470
Dialogic Corp. (a) 26,000 799
Lucent Technologies, Inc. 170,000 8,712
Nokia Corp. AB sponsored ADR 50,000 2,806
P-COM, Inc. (a) 135,000 4,286
Pairgain Technologies, Inc. (a) 20,000 1,278
Tellabs, Inc. (a) 118,000 4,691
3Com Corp. (a) 175,000 13,147
Teledata Communications Ltd. 100,000 2,225
U.S. Robotics Corp. (a) 50,000 3,931
159,516
COMPUTER SERVICES & SOFTWARE - 22.6%
Affiliated Computer Services, Inc. Class A (a) 230,000 6,670
America Online, Inc. (a) 109,400 3,870
American Management Systems, Inc. (a) 115,050 4,091
Analysts International Corp. 150,000 4,050
Applix, Inc. (a) 105,000 2,074
Automatic Data Processing, Inc. 172,300 7,387
BBN Corp. (a) 50,000 1,150
BMC Software, Inc. (a) 150,000 6,525
Baan Co. NV (a) 125,000 4,453
CACI International, Inc. Class A (a) 325,000 6,134
CBT Group PLC sponsored ADR (a) 30,000 1,725
CCC Information Services Group, Inc. (a) 219,500 3,402
CUC International, Inc. (a) 1,649,400 43,503
Cadence Design Systems, Inc. (a) 275,000 10,966
Ceridian Corp. (a) 29,300 1,410
Ciber, Inc. (a) 25,000 825
Citrix Systems, Inc. (a) 30,000 1,369
Clarify, Inc. (a) 85,000 3,825
CompuCom Systems, Inc. (a) 282,900 3,324
CompUSA, Inc. (a) 340,700 15,331
Computer Associates International, Inc. 160,000 10,520
Computer Horizons Corp. (a) 50,000 1,675
Computer Learning Centers, Inc. (a) 135,900 3,398
Computer Sciences Corp. (a) 135,000 10,614
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - CONTINUED
Compuware Corp. (a) 25,000 $ 1,413
Dataworks Corp. (a) 150,000 3,263
Electronic Data Systems Corp. 79,800 3,860
Electronics for Imaging, Inc. (a) 90,000 7,650
First Data Corp. 125,000 4,984
Forte Software, Inc. (a) 25,000 794
HBO & Co. 225,000 12,797
Harbinger Corp. (a) 75,000 1,959
Henry (Jack) & Associates, Inc. 60,000 2,280
Inacom Corp. (a) 60,000 1,860
Inso Corp. (a) 90,800 3,870
Keane, Inc. (a) 125,000 6,609
Legato Systems, Inc. (a) 50,000 1,750
Lycos, Inc. (a) 545,900 6,346
McAfee Associates, Inc. (a) 300,600 14,354
Microsoft Corp. (a) 260,900 40,929
Netscape Communications Corp. (a) 275,000 15,366
Oracle Systems Corp. (a) 1,335,000 65,415
Orckit Communications Ltd. (a) 2,500 28
Parametric Technology Corp. (a) 230,000 12,506
Paychex, Inc. 75,000 4,013
PeopleSoft, Inc. (a) 200,000 18,300
Physician Computer Network, Inc. (a) 193,700 1,598
Policy Management Systems Corp. (a) 63,300 2,532
Remedy Corp. (a) 60,700 2,747
Sabre Group Holdings, Inc. Class A (a) 85,000 2,486
Saville Systems Ireland PLC sponsored ADR (a) 100,000 4,163
Scopus Technology, Inc. (a) 115,000 4,298
SunGard Data Systems, Inc. (a) 85,000 3,570
Sybase, Inc. (a) 77,600 1,368
Sykes Enterprises, Inc. (a) 50,000 2,175
Technology Solutions, Inc. (a) 97,500 4,388
Vanstar Corp. (a) 207,000 5,641
Vantive Corp. (a) 175,300 6,048
Viasoft, Inc. (a) 65,000 2,941
Visio Corp. (a) 100,000 4,950
Wind River Systems, Inc. (a) 75,000 3,684
441,226
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTERS & OFFICE EQUIPMENT - 8.1%
Adaptec, Inc. (a) 600,000 $ 22,350
Bay Networks, Inc. (a) 125,000 3,344
Compaq Computer Corp. (a) 350,000 27,737
Dell Computer Corp. (a) 150,000 15,244
EMC Corp. (a) 261,700 8,440
Eltron International, Inc. (a) 25,800 800
FileNet Corp. (a) 118,000 4,248
Gateway 2000, Inc. (a) 29,400 1,577
Hewlett-Packard Co. 125,000 6,734
Ingram Micro, Inc. Class A (a) 146,400 3,605
International Business Machines Corp. 225,000 35,859
Lexmark International Group, Inc. (a) 71,800 1,858
Micron Electronics, Inc. (a) 142,800 2,749
Quantum Corp. (a) 156,500 4,186
SCI Systems, Inc. (a) 65,000 3,429
Seagate Technology (a) 322,400 12,735
Tech Data Corp. 111,900 3,357
158,252
ELECTRONIC INSTRUMENTS - 0.5%
Applied Materials, Inc. (a) 100,000 3,813
Teradyne, Inc. (a) 189,000 4,465
Thermo Voltek Corp. 112,500 1,223
9,501
ELECTRONICS - 7.4%
Analog Devices, Inc. (a) 150,000 4,819
Atmel Corp. (a) 140,000 4,602
Cascade Communications Corp. (a) 45,000 3,111
Cirrus Logic, Inc. (a) 135,000 2,649
Flextronics International 39,000 1,365
Hadco Corp. 16,100 748
Intel Corp. 585,000 74,222
KEMET Corp. (a) 85,000 1,955
Lattice Semiconductor Corp. 24,200 1,083
Linear Technology Corp. 250,000 11,781
Maxim Integrated Products, Inc. (a) 258,000 11,965
Micron Technology, Inc. 105,000 3,478
Motorola, Inc. 50,000 2,769
S3, Inc. (a) 17,700 301
Solectron Corp. (a) 80,000 4,680
Storage Technology Corp. (a) 120,000 5,985
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
ELECTRONICS - CONTINUED
Texas Instruments, Inc. 49,300 $ 3,143
Xilinx, Inc. (a) 73,900 3,242
Zilog, Inc. 100,000 2,237
144,135
PHOTOGRAPHIC EQUIPMENT - 0.0%
3D Systems Corp. (a) 43,500 445
TOTAL TECHNOLOGY 913,075
TRANSPORTATION - 0.2%
AIR TRANSPORTATION - 0.2%
Atlantic Southeast Airlines, Inc. 115,000 2,616
Comair Holdings, Inc. 75,000 1,866
4,482
UTILITIES - 5.2%
CELLULAR - 2.7%
AirTouch Communications, Inc. (a) 950,000 24,344
Arch Communications Group, Inc. (a) 138,113 1,519
Palmer Wireless, Inc. (a) 426,000 6,390
360 Degrees Communications Co. (a) 335,000 7,956
Vanguard Cellular Systems, Inc. Class A (a) 729,100 12,304
52,513
TELEPHONE SERVICES - 2.5%
Comsat Corp., Series 1 60,000 1,575
LCI International, Inc. (a) 325,000 10,603
MCI Communications Corp. 285,000 8,693
MFS Communications, Inc. 259,300 12,511
Sprint Corp. 105,000 4,397
Telebras sponsored ADR 25,000 1,894
Telefonos de Mexico SA sponsored ADR representing
Ord. Class L shares 25,000 759
Teleport Communications Group, Inc. Class A (a) 85,000 2,816
WorldCom, Inc. (a) 235,000 5,434
48,682
TOTAL UTILITIES 101,195
TOTAL COMMON STOCKS
(Cost $1,422,375) 1,895,701
CASH EQUIVALENTS - 2.8%
SHARES VALUE (NOTE 1)
(000S)
Taxable Central Cash Fund (c) (Cost $55,372) 55,372,000 $ 55,372
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,477,747) $ 1,951,073
LEGEND
1. Non-income producing
2. Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $1,245,000 or 0.1% of net
assets.
3. At period end, the seven-day yield on the Taxable Central Cash Fund was
5.46%. The yield refers to the income earned by investing in the fund over
the seven-day period, expressed as an annual percentage.
INCOME TAX INFORMATION
At November 30, 1996, the aggregate cost of investment securities for
income tax purposes was $1,483,346,000. Net unrealized appreciation
aggregated $467,727,000, of which $519,361,000 related to appreciated
investment securities and $51,634,000 related to depreciated investment
securities.
The fund hereby designates approximately $4,955,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNTS) NOVEMBER 30, 1996
ASSETS
Investment in securities, at value (cost $1,477,747) - $ 1,951,073
See accompanying schedule
Cash 1,478
Receivable for investments sold 5,374
Receivable for fund shares sold 2,384
Dividends receivable 458
Interest receivable 347
Redemption fees receivable 1
Other receivables 562
TOTAL ASSETS 1,961,677
LIABILITIES
Payable for investments purchased $ 13,133
Payable for fund shares redeemed 7,438
Accrued management fee 1,218
Other payables and accrued expenses 677
TOTAL LIABILITIES 22,466
NET ASSETS $ 1,939,211
Net Assets consist of:
Paid in capital $ 1,442,820
Accumulated undistributed net realized gain (loss) on 23,065
investments and foreign currency transactions
Net unrealized appreciation (depreciation) on 473,326
investments and assets and liabilities in foreign
currencies
NET ASSETS, for 73,552 shares outstanding $ 1,939,211
NET ASSET VALUE and redemption price per share $26.37
($1,939,211 (divided by) 73,552 shares)
Maximum offering price per share (100/97.00 of $26.37) $27.19
STATEMENT OF OPERATIONS
AMOUNTS IN THOUSANDS YEAR ENDED NOVEMBER 30, 1996
INVESTMENT INCOME $ 4,103
Dividends
Interest 8,370
TOTAL INCOME 12,473
EXPENSES
Management fee $ 10,537
Basic fee
Performance adjustment 1,915
Transfer agent fees 4,218
Accounting fees and expenses 636
Non-interested trustees' compensation 6
Custodian fees and expenses 91
Registration fees 251
Audit 52
Legal 15
Miscellaneous 11
Total expenses before reductions 17,732
Expense reductions (261) 17,471
NET INVESTMENT INCOME (LOSS) (4,998)
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 27,531
Foreign currency transactions (3) 27,528
Change in net unrealized appreciation (depreciation) on:
Investment securities 172,135
Assets and liabilities in foreign currencies (1) 172,134
NET GAIN (LOSS) 199,662
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 194,664
FROM OPERATIONS
STATEMENT OF CHANGES IN NET ASSETS
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED YEAR ENDED
NOVEMBER 30, NOVEMBER 30,
1996 1995
INCREASE (DECREASE) IN NET ASSETS
Operations $ (4,998) $ (6,017)
Net investment income (loss)
Net realized gain (loss) 27,528 78,535
Change in net unrealized appreciation (depreciation) 172,134 242,343
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 194,664 314,861
FROM OPERATIONS
Distributions to shareholders from net realized gains (59,173) (1,472)
Share transactions 977,456 696,173
Net proceeds from sales of shares
Reinvestment of distributions 58,461 1,448
Cost of shares redeemed (564,710) (291,096)
Redemption fees 751 754
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 471,958 407,279
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 607,449 720,668
NET ASSETS
Beginning of period 1,331,762 611,094
End of period $ 1,939,211 $ 1,331,762
OTHER INFORMATION
Shares
Sold 40,103 31,072
Issued in reinvestment of distributions 2,601 89
Redeemed (23,706) (13,468)
Net increase (decrease) 18,998 17,693
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30,
1996 1995 1994 E 1993 1992
SELECTED PER-SHARE DATA
Net asset value, beginning $ 24.41 $ 16.58 $ 19.63 $ 16.92 $ 14.81
of period
Income from Investment
Operations
Net investment income (loss) (.07) C (.14) C (.07) C (.03) .09
Net realized and unrealized 3.10 7.99 .34 3.29 2.50
gain (loss)
Total from investment 3.03 7.85 .27 3.26 2.59
operations
Less Distributions
From net investment income - - - (.02) -
From net realized gain (1.08) (.04) (3.33) (.54) (.50)
Total distributions (1.08) (.04) (3.33) (.56) (.50)
Redemption fees added to .01 .02 .01 .01 .02
paid in capital
Net asset value, end of period $ 26.37 $ 24.41 $ 16.58 $ 19.63 $ 16.92
TOTAL RETURN A, B 13.27% 47.59% 1.27% 19.85% 18.03%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period $ 1,939 $ 1,332 $ 611 $ 634 $ 615
(in millions)
Ratio of expenses to average 1.10% 1.10% 1.04% 1.20% 1.09%
net assets
Ratio of expenses to average 1.09% D 1.09% 1.02% 1.19% 1.09%
net assets after expense D D D
reductions
Ratio of net investment income (.31)% (.66)% (.41) (.20) .56%
(loss) to average net assets % %
Portfolio turnover rate 105% 102% 180% 332% 531%
Average commission rate F $ .0405
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE.
C NET INVESTMENT INCOME (LOSS) PER SHARE HAS BEEN CALCULATED BASED ON
AVERAGE SHARES OUTSTANDING DURING THE PERIOD.
D FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS)
E 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, NET INVESTMENT INCOME (LOSS) PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
F FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
NOTES TO FINANCIAL STATEMENTS
For the period ended November 30, 1996
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Emerging Growth 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 financial statements have
been prepared in conformity with generally accepted accounting principles
which permit management to make certain estimates and assumptions at the
date of the financial statements. The following summarizes the significant
accounting policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are readily
available are valued at the last sale price, or if no sale price, at the
closing bid price. Securities (including restricted securities) for which
exchange quotations are not readily available (and in certain cases debt
securities which trade on an exchange) are valued primarily using
dealer-supplied valuations or at their fair value as determined in good
faith under consistently applied procedures under the general supervision
of the Board of Trustees. Short-term securities with remaining maturities
of sixty days or less for which quotations are not readily available are
valued at amortized cost or original cost plus accrued interest, both of
which approximate current value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Income receipts
and expense payments are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and
sales of securities are translated into U.S. dollars at the contractual
currency exchange rates established at the time of each trade.
Net realized gains and losses on foreign currency transactions represent
net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, and the difference between
the amount of net investment income accrued and the U.S. dollar amount
actually received. The effects of changes in foreign currency exchange
rates on investments in securities are included with the net realized and
unrealized gain or loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes substantially all of its taxable income for
its fiscal year. The schedule of investments includes information regarding
income taxes under the caption "Income Tax Information."
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. Non-cash dividends included in dividend
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
income, if any, are recorded at the fair market value of the securities
received. Interest income is accrued as earned. Investment 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.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for litigation
proceeds, net operating losses and losses deferred due to wash sales. The
fund also utilized earnings and profits distributed to shareholders on
redemption of shares as a part of the dividends-paid deduction for income
tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net investment income (loss) and
realized and unrealized gain (loss). Accumulated net investment (loss) and
accumulated undistributed net realized gain (loss) on
investments and foreign currency transactions 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.
REDEMPTION FEES. Shares held in the fund less than 90 days are subject to a
redemption fee equal to .75% of the proceeds of the redeemed shares. The
fee, which is retained by the fund, is accounted for as an addition to paid
in capital.
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.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign securities. Losses may
arise from changes in the value of the foreign currency or if the
counterparties do not perform under the contracts' terms. The U.S. dollar
value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (SEC), the fund, along with other
affiliated entities of Fidelity Management & Research Company (FMR), may
transfer uninvested cash balances into one or more joint trading
2. OPERATING POLICIES - CONTINUED
JOINT TRADING ACCOUNT - CONTINUED
accounts. These balances are invested in one or more repurchase agreements
that mature in 60 days or less from the date of purchase for U.S. Treasury
or Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account, at a bank custodian. The securities are marked-to-market
daily and maintained at a value at least equal to the principal amount of
the repurchase agreement (including accrued interest). FMR, the fund's
investment adviser, is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by the
SEC, the fund may invest in the Taxable Central Cash Fund (the Cash Fund)
managed by FMR. The Cash Fund is an open-end money market fund available
only to investment companies and other accounts managed by FMR and its
affiliates. The Cash Fund seeks preservation of capital, liquidity, and
current income by investing in U.S. Treasury securities and repurchase
agreements for these securities, and may be utilized by the fund as an
additional cash management option. Dividends from the Cash Fund are
declared daily and paid monthly from net interest income. Income
distributions received by the fund are recorded as interest income.
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $2,039,164,000 and $1,551,306,000, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
basic fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR. The
rates ranged from .2500% to .5200% for the period. In the event that these
rates were lower than the contractual rates in effect during the period,
FMR voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. The annual individual fund fee rate is .35%. The
basic fee is subject to a performance adjustment (up to a maximum of
(plus/minus) .20% of the fund's average net assets over the performance
period.) based on the fund's investment performance as compared to the
appropriate index over a specified period of time. For the period, the
management fee was equivalent to an annual rate of .77% of average net
assets after the performance adjustment.
SALES LOAD. For the period, Fidelity Distributors Corporation, an affiliate
of FMR and the general distributor of the fund, received sales charges of
$3,172,000 on sales of shares of the fund.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
TRANSFER AGENT FEES. FSC, is the fund's transfer, dividend disbursing and
shareholder servicing agent. FSC receives account fees and asset-based fees
that vary according to account size and type of account. FSC pays for
typesetting, printing and mailing of all shareholder reports, except proxy
statements. For the period, the transfer agent fees were equivalent to an
annual rate of .26% of average net assets.
ACCOUNTING FEES. FSC maintains the fund's accounting records. The fee is
based on the level of average net assets for the month plus out-of-pocket
expenses.
BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid to these affiliated firms were $368,000 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
$231,000 under this arrangement.
The fund has entered into arrangements with its custodian and transfer
agent whereby interest earned on uninvested cash balances was used to
offset a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $11,000 and $19,000,
respectively, under these arrangements.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Mt. Vernon Street Trust and the Shareholders of
Fidelity Emerging Growth Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Mt. Vernon Street Trust: Fidelity Emerging Growth Fund, including
the schedule of portfolio investments, as of November 30, 1996, and the
related statement of operations for the year then ended, the statement of
changes in net assets for each of the two years in the period then ended
and the financial highlights for each of the five years in the period then
ended. These financial statements and financial highlights are the
responsibility of the fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of November 30, 1996 by correspondence with the
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Mt. Vernon Street Trust: Fidelity Emerging Growth Fund as of
November 30, 1996, the results of its operations for the year then ended,
the changes in its net assets for each of the two years in the period then
ended, and the financial highlights for each of the five years in the
period then ended, in conformity with generally accepted accounting
principles.
/s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
January 3, 1997
DISTRIBUTIONS
The Board of Trustees of Fidelity Emerging Growth Fund voted to pay to
shareholders of record at the opening of business on record date, the
following
distributions derived from capital gains realized from sales of portfolio
securities, and dividends derived from net investment income:
PAY DATE RECORD DATE DIVIDENDS CAPITAL GAINS
12/16/96 12/13/96 - $.32
A total of 2% of the dividends distributed during the fiscal year qualifies
for the dividends-received deductions for corporate shareholders.
The fund will notify shareholders in January 1997 of the applicable
percentage for use in preparing 1996 income tax returns.
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Lawrence Greenberg, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Robert H. Morrison, Manager,
Security Transactions
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
ADVISORY BOARD
William O. McCoy
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co., Inc.
Boston, MA
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
FIDELITY'S GROWTH FUNDS
Blue Chip Growth Fund
Capital Appreciation Fund
Contrafund
Disciplined Equity Fund
Dividend Growth Fund
Emerging Growth Fund
Export Fund
Fidelity Fifty
Growth Company Fund
Large Cap Stock Fund
Low-Priced Stock Fund
Magellan(registered trademark) Fund
Mid-Cap Stock Fund
New Millennium(trademark) Fund
OTC Portfolio
Retirement Growth Fund
Small Cap Stock Fund
Stock Selector
Trend Fund
Value Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
TouchTone Xpress 1-800-544-5555
SM
* INDEPENDENT TRUSTEES
AUTOMATED LINE FOR QUICKEST SERVICE
FIDELITY
(registered trademark)
NEW MILLENNIUM(trademark)
FUND
ANNUAL REPORT
NOVEMBER 30, 1996
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 6 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 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 24 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
NOTES 28 Notes to the financial statements.
REPORT OF INDEPENDENT 32 The auditors' opinion.
ACCOUNTANTS
DISTRIBUTIONS 33
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE
PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND MONEY.
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
Although stocks have managed to post solid returns throughout 1996, signs
of strength in the economy have led to inflation fears, causing some
uncertainty in both the stock and bond markets so far this year. In 1995,
both stock and bond markets posted strong results, while the year before,
stocks posted below-average returns and bonds had one of the worst years in
history.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
If you can leave your money invested over the long term, you can avoid the
results of the volatility that generally accompanies the stock market in
the short term. You also can help to manage some of the risks of investing
through diversification. A stock fund is already diversified because it
invests in many issues. You can diversify even further by placing some of
your money in several different types of stock funds or in other investment
categories, such as bonds.
If you have a short investment time horizon, you might want to consider
moving some of your investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
Finally, no matter what your investment horizon or portfolio diversity, it
makes good sense to follow a regular investment plan - investing a certain
amount of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
If you have any questions, please call us at 1-800-544-8888. We stand ready
to provide the information you need to make the investments that are right
for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. A fund's total
return includes changes in share price, plus reinvestment of any dividends
(or income) and capital gains (the profits the fund earns when it sells
securities that have grown in value).
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1996 PAST 1 LIFE OF
YEAR FUND
New Millennium 24.88% 137.62%
New Millennium (incl. 3% sales charge) 21.13% 130.50%
S&P 500(registered trademark) 27.86% 90.76%
Capital Appreciation Funds Average 18.05% n/a
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, or since the fund started on
December 28, 1992. For example, if you invested $1,000 in a fund that had a
5% return over the past year, the value of your investment would be $1,050.
You can compare the fund's returns to the performance of the Standard &
Poor's 500 Index - a widely recognized, unmanaged index of common stocks.
To measure how the fund's performance stacked up against its peers, you can
compare it to the capital appreciation funds average, which reflects the
performance of 185 mutual funds with similar objectives tracked by Lipper
Analytical Services, Inc. over the past 12 months. Both benchmarks include
reinvested dividends and capital gains, if any, and exclude the effects of
sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1996 PAST 1 LIFE OF
YEAR FUND
New Millennium 24.88% 24.64%
New Millennium (incl. 3% sales charge) 21.13% 23.68%
S&P 500 27.86% 17.87%
Capital Appreciation Funds Average 18.05% 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
IMAHDR PRASUN SHR__CHT 19961130 19961210 102125 S00000000000001
New Millennium SP Standard & Poor 500
00300 SP001
1992/12/28 9700.00 10000.00
1992/12/31 9777.60 9910.45
1993/01/31 10291.70 9993.70
1993/02/28 10029.80 10129.62
1993/03/31 10437.20 10343.35
1993/04/30 10340.20 10093.04
1993/05/31 10951.30 10363.53
1993/06/30 11038.60 10393.59
1993/07/31 11242.30 10352.01
1993/08/31 11620.60 10744.36
1993/09/30 11892.20 10661.62
1993/10/31 12105.60 10882.32
1993/11/30 11610.90 10778.94
1993/12/31 12189.94 10909.36
1994/01/31 12418.52 11280.28
1994/02/28 12448.35 10974.59
1994/03/31 11682.76 10496.09
1994/04/30 11613.16 10630.44
1994/05/31 11533.62 10804.78
1994/06/30 11285.05 10540.07
1994/07/31 11523.67 10885.78
1994/08/31 12160.01 11332.10
1994/09/30 12368.81 11054.46
1994/10/31 12756.58 11303.19
1994/11/30 12229.61 10891.52
1994/12/31 12290.89 11053.05
1995/01/31 12026.25 11339.65
1995/02/28 12546.03 11781.56
1995/03/31 13014.85 12129.23
1995/04/30 13830.19 12486.44
1995/05/31 13983.06 12985.52
1995/06/30 15195.88 13287.17
1995/07/31 16500.42 13727.78
1995/08/31 16694.06 13762.23
1995/09/30 17325.95 14343.00
1995/10/31 17162.88 14291.79
1995/11/30 18457.23 14919.20
1995/12/31 18699.43 15206.55
1996/01/31 18382.01 15724.18
1996/02/29 19679.17 15869.94
1996/03/31 20056.13 16022.77
1996/04/30 21231.33 16258.95
1996/05/31 21830.02 16678.26
1996/06/30 21098.29 16741.81
1996/07/31 19346.57 16002.15
1996/08/31 20344.39 16339.64
1996/09/30 21763.50 17259.24
1996/10/31 21852.20 17735.24
1996/11/29 23049.58 19075.85
IMATRL PRASUN SHR__CHT 19961130 19961210 102127 R00000000000051
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity New Millennium Fund on December 28, 1992, when the
fund started, and a 3% sales charge was paid. As the chart shows, by
November 30, 1996, the value of the investment would have grown to $23,050
- - a 130.50% increase on the 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 $19,076 - a 90.76% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Paced by the robust performance
of blue chip stocks, the U.S. stock
market posted strong gains for the
year that ended November 30,
1996. The Standard & Poor's 500
Index returned 27.86% during the
period - well above its long-term
average of about 12%. The stock
market spent much of the past
year breaking price and trading
volume records. Solid corporate
earnings reports, large cash
inflows into mutual funds,
widespread optimism and a
generally favorable interest rate
environment propelled share
prices higher. Large capitalization
stocks thrived as investors sought
their lower volatility and higher
degree of liquidity over smaller
cap stocks in an environment
where it was sometimes difficult to
discern the health of the economy.
The Dow Jones Industrial
Average closed above 6500 for
the first time in November. While
short-term confusion over the
direction of interest rates created
a volatile backdrop in the summer
months, stocks rallied again when
the Federal Reserve Board left
short-term interest rates
unchanged and it appeared
inflation would not be an issue for
the remainder of 1996.
Smaller-company stocks posted
strong gains at the beginning of
1996, but trended downward in
the spring and summer because
their earnings tend to be more
affected by the higher borrowing
costs brought on by higher rates.
When interest rate fears subsided,
these stocks rebounded, only to
fade toward the end of the period
due to earnings concerns and a
general flight to quality.
An interview with Neal Miller, Portfolio Manager of Fidelity New Millennium
Fund
Q. HOW DID THE FUND PERFORM, NEAL?
A. Pretty well. For the 12 months that ended November 30, 1996, the fund
had a return of 24.88%. For a sense of how the fund performed relative to
its competition, the capital appreciation funds average returned 18.05%
over the same period, as tracked by Lipper Analytical Services. In terms of
the marketplace in which the fund invests, the Standard & Poor's 500 Index
was up 27.86% over the 12-month period.
Q. CAN YOU DESCRIBE THE FORCES BEHIND THE FUND'S PERFORMANCE?
A. It was really a tale of two periods - the first six months of the period
and the last six. Events that took place in the first part of the year go a
long way in explaining the return differential between the fund and the S&P
500. The first six months were characterized by some unforeseeable,
unfortunate events, such as the two airline tragedies. I had a significant
position in aviation stocks and that sector suffered due to these
tragedies. My play on Internet-related stocks, which has been historically
successful, did not quite pan out during this period. The second half
brought somewhat better results, largely due to improved corporate earnings
and cash flows.
Q. LARGE-CAP STOCKS - THE MORE ESTABLISHED, HOUSEHOLD NAMES - HAVE ENJOYED
A BANNER YEAR. DID THE FACT THAT THE FUND'S STRATEGY IS GEARED TOWARDS
SMALLER-SIZED STOCKS HAVE RAMIFICATIONS?
A. Since my discipline typically leads me to the smaller- and medium-sized
stocks, the fact that the market rewarded the larger stocks pulled
performance down some. I'm looking for stocks that can capitalize on a
favorable marketing advantage and companies that are taking themselves to
the next level of growth with up-and-coming products. By nature, this leads
me more into the smaller-capitalization companies, and this sector of the
market had a tough year. While my style is to buy companies that offer
favorable earnings surprises, the market seemed to reward those companies
that can produce through thick and thin.
Q. TWO OF THE FUND'S LARGER CONCENTRATIONS WERE IN THE TECHNOLOGY AND
RETAIL SECTORS. CAN YOU DISCUSS THE DEVELOPMENTS THAT TOOK PLACE IN THOSE
AREAS?
A. Internet-related technology stocks went through a difficult phase. While
there continued to be exciting opportunities in the sector, the Internet is
experiencing growing pains and it will take longer than I anticipated for
profits to come through. Because of this, valuations weren't there and I
pared back my holdings. Going forward, I'll be looking at companies that
make products designed to improve data transmission speed and companies
specializing in better storage management, two areas which should continue
to see high demand. In terms of retail and apparel stocks, my belief over
the past year was that new fashion would reawaken consumers to the
obsolescence of their existing wardrobes. While this theme has worked, I
think we're coming to the end of the cycle. I walk through stores now and
there seems to be too much variety and too much color - it's turned into a
confusing backdrop for consumers. On balance, some retail stocks -
including luxury vendors and teen-targeted retailers - have been productive
contributors to the fund's performance.
Q. WITH RESPECT TO INDIVIDUAL STOCKS, THE TOP HOLDINGS HAVE CHANGED
SIGNIFICANTLY SINCE WE LAST SPOKE. WHICH STOCKS WERE GOOD PERFORMERS AND
WHICH PROVED DISAPPOINTING?
A. The portfolio is dynamic, reflecting changes in valuations. As far as
individual wins and losses, I've taken profits in such stocks as IMC Global
Inc. (fertilizer/mining), Rational Software Corp. and Transocean Offshore
Inc. (oil drilling). On the flip side, U.S. Robotics (modems), Primark
Corp. (information services) and CMG Information Services (advertising)
were somewhat disappointing.
Q. IN ORDER TO MAINTAIN THE ALIGNMENT BETWEEN THE FUND'S GOALS AND INCOMING
CASH FLOWS, THE FUND WAS CLOSED TO NEW INVESTORS IN MAY. WHAT EFFECT HAS
THIS HAD?
A. It's given me time to assimilate the cash flows and to feel comfortable
with the position of the portfolio. A smaller amount of cash allows me more
easily to manage the fund according to its investment style, which is to
look at rapidly growing companies.
Q. WHAT'S YOUR OUTLOOK FOR THE COMING MONTHS?
A. While the stock market reached historic levels in 1996, I think we're in
a prolonged, robust business cycle, rather than an overheated economy.
Risk/return characteristics look good going forward, and earnings should
continue to be strong. These characteristics, combined with corporate
America's seeming desire to streamline infrastructures, equates to an
inviting backdrop for equities.
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: long-term capital
appreciation by investing
mainly in equity securities of
companies that are likely to
benefit from social and
economic trends
FUND NUMBER: 300
TRADING SYMBOL: FMILX
START DATE: December
28, 1992
SIZE: as of November 30,
1996, more than $1.2 billion
MANAGER: Neal Miller, since
inception; joined Fidelity in 1988
(checkmark)
NEAL MILLER DISCUSSES THE "NEW
MILLENNIUM":
"There seems to be
unmeasurable, upside
potential associated with the
year 2000 and the "clock
problem" involved with
ensuring that computers will
work past that year. It's the
one time I've seen where
computer applications that
involve dates will not function
if the problem isn't resolved.
For those who are unfamiliar
with this issue, all computer
applications dealing with dates
that start with 19xx will stop
running correctly as the year
2000 is entered. Companies
in the financial sector may feel
more of the brunt because it's
such a date-intensive industry.
With these concerns in mind,
some of my focus will be on
finding companies offering
"clock problem" remedies. In
locating these companies, it's
helpful to monitor what some
of the larger
technology-dependent
companies - including Fidelity,
for instance - are doing to
meet this challenge. One
promising stock currently
owned by the fund is Viasoft,
a company that has devoted
much of its resources to
solving this dilemma. Viasoft's
management hopes the
company can capture 10-20%
of the market for solutions.
Companies that are
successful in developing
products to solve this problem
may see rapid growth in an
extremely short period of
time."
INVESTMENT CHANGES
TOP TEN STOCKS AS OF NOVEMBER 30, 1996
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO
Intel Corp. 3.9 0.3
Reading & Bates Corp. 2.2 1.9
Wolverine World Wide, Inc. 2.1 1.7
Global Marine, Inc. 2.1 0.8
Compaq Computer Corp. 2.0 0.0
Viasoft, Inc. 1.9 0.0
Smith International, Inc. 1.8 1.0
Seagate Technology 1.7 0.2
EMC Corp. 1.7 0.0
Food Lion, Inc. Class A 1.7 1.0
TOP FIVE MARKET SECTORS AS OF NOVEMBER 30, 1996
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET SECTORS
6 MONTHS AGO
Technology 44.6 26.8
Energy 11.6 9.3
Retail & Wholesale 5.5 9.6
Durables 4.9 4.9
Media & Leisure 4.2 6.3
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF NOVEMBER 30, 1996 * AS OF MAY 31, 1996 **
Row: 1, Col: 1, Value: 5.4
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 44.6
Row: 1, Col: 4, Value: 50.0
Row: 1, Col: 1, Value: 6.8
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 53.2
Row: 1, Col: 4, Value: 40.0
Stocks 94.6%
Short-term
investments 5.4%
FOREIGN
INVESTMENTS 4.8%
Stocks 93.2%
Short-term
investments 6.8%
FOREIGN
INVESTMENTS 7.2%
*
**
INVESTMENTS NOVEMBER 30, 1996
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 94.3%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 2.0%
AAR Corp. 164,100 $ 4,902
Boeing Co. 67,400 6,698
Fairchild Corp. Class A (a) 535,700 8,906
Precision Castparts Corp. 98,800 4,631
25,137
BASIC INDUSTRIES - 1.9%
CHEMICALS & PLASTICS - 0.8%
Air Products & Chemicals, Inc. 9,000 626
Avery Dennison Corp. 95,200 6,724
IMC Global, Inc. 2,000 72
Monsanto Co. 51,100 2,030
9,452
IRON & STEEL - 0.9%
Quanex Corp. 12,100 324
SPS Technologies, Inc. (a) 171,000 10,730
Steel Dynamics, Inc. 21,200 387
11,441
METALS & MINING - 0.1%
Encore Wire Corp. (a) 14,300 227
Uranium Resources, Inc. (a) 121,200 1,121
1,348
PAPER & FOREST PRODUCTS - 0.1%
Triangle Pacific Corp. (a) 57,700 1,259
TOTAL BASIC INDUSTRIES 23,500
CONSTRUCTION & REAL ESTATE - 1.2%
BUILDING MATERIALS - 0.3%
Coflexip sponsored ADR (a) 95,800 2,574
Lilly Industries, Inc. Class A 4,100 76
T.J. International, Inc. 19,300 420
3,070
CONSTRUCTION - 0.9%
Butler Manufacturing Co. 307,850 9,812
Lennar Corp. 3,600 94
NCI Building Systems, Inc. (a) 60,800 1,748
11,654
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONSTRUCTION & REAL ESTATE - CONTINUED
ENGINEERING - 0.0%
Service Experts, Inc. (a) 5,000 $ 124
REAL ESTATE INVESTMENT TRUSTS - 0.0%
Koger Equity, Inc. (a) 20,000 325
TOTAL CONSTRUCTION & REAL ESTATE 15,173
DURABLES - 4.9%
AUTOS, TIRES, & ACCESSORIES - 0.5%
Honda Motor Co. Ltd. ADR 65,000 3,859
Miller Industries, Inc. (a) 93,000 2,581
SPX Corp. 12,800 406
6,846
CONSUMER DURABLES - 0.3%
Dupont Photomasks, Inc. (a) 86,300 3,581
Spectran Corp. (a) 23,200 409
3,990
CONSUMER ELECTRONICS - 0.1%
Sunbeam-Oster, Inc. 41,800 1,155
HOME FURNISHINGS - 0.2%
Flexsteel Industries, Inc. 5,000 64
Miller (Herman), Inc. 43,000 2,021
O'Sullivan Industries Holdings (a) 16,900 188
2,273
TEXTILES & APPAREL - 3.8%
Gucci Group NV 239,000 17,536
Jones Apparel Group, Inc. (a) 7,700 237
Mohawk Industries, Inc. (a) 39,800 948
NIKE, Inc. Class B 43,100 2,451
Shaw Industries, Inc. 1,600 19
Wolverine World Wide, Inc. 990,500 26,620
47,811
TOTAL DURABLES 62,075
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
ENERGY - 11.6%
ENERGY SERVICES - 11.5%
American Oilfield Divers, Inc. (a) 13,000 $ 169
Atwood Oceanics, Inc. (a) 91,900 5,100
Diamond Offshore Drilling, Inc. (a) 256,476 16,350
ENSCO International, Inc. (a) 156,500 6,866
Global Marine, Inc. (a) 1,336,500 26,062
Layne, Inc. (a) 11,200 160
Marine Drilling Companies, Inc. (a) 390,300 6,196
Noble Drilling Corp. (a) 453,600 8,732
Offshore Logistics, Inc. (a) 52,600 1,052
Reading & Bates Corp. (a) 955,200 27,701
Rowan Companies, Inc. (a) 440,500 10,407
Schlumberger Ltd. 86,800 9,027
Seitel, Inc. 300 12
Smith International, Inc. (a) 573,200 23,430
Transocean Offshore, Inc. 77,500 4,669
145,933
OIL & GAS - 0.1%
Chesapeake Energy Corp. (a) 23,250 1,520
Monterey Resources, Inc. (a) 12,900 213
1,733
TOTAL ENERGY 147,666
FINANCE - 2.6%
BANKS - 0.3%
Bangkok Bank Ltd. (For. Reg.) 33,000 377
Chase Manhattan Corp. 17,100 1,616
Cullen Frost Bankers, Inc. 9,100 323
Riggs National Corp. 96,700 1,674
3,990
FEDERAL SPONSORED CREDIT - 0.7%
Federal Agricultural Mortgage Corp. Class C (non-vtg.) (a) 25,500 536
Student Loan Marketing Association 82,000 7,882
8,418
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - CONTINUED
INSURANCE - 0.9%
AFLAC, Inc. 31,300 $ 1,307
Conseco, Inc. 106,300 5,940
Progressive Corp. 58,600 4,087
Provident American Corp. 4,200 50
11,384
SAVINGS & LOANS - 0.0%
Security First Network Bank (a) 16,600 195
SECURITIES INDUSTRY - 0.7%
Franklin Resources, Inc. 106,000 7,579
Provida SA sponsored ADR 20,200 399
United Asset Management Corp. 19,500 529
8,507
TOTAL FINANCE 32,494
HEALTH - 3.2%
DRUGS & PHARMACEUTICALS - 0.7%
Barr Laboratories, Inc. (a) 7,800 197
Biogen, Inc. (a) 22,400 857
Curative Technologies, Inc. (a) 18,700 486
Hauser Chemical Research, Inc. (a) 278,500 1,601
Idexx Laboratories (a) 22,200 777
Magainin Pharmaceuticals, Inc. (a) 153,600 1,286
Regeneron Pharmaceuticals, Inc. (a) 171,800 3,286
Sequus Pharmaceuticals, Inc. (a) 71,100 1,022
9,512
MEDICAL EQUIPMENT & SUPPLIES - 2.0%
Ballard Medical Products 129,800 2,434
Biomet, Inc. 169,500 2,797
Boston Scientific Corp. (a) 38,400 2,242
Dentsply International, Inc. 76,500 3,557
Sofamor/Danek Group, Inc. (a) 79,400 2,233
Spine-Tech, Inc. (a) 178,200 4,722
Sullivan Dental Products, Inc. 2,100 28
Sybron International, Inc. (a) 101,700 3,089
U.S. Surgical Corp. 101,600 4,077
25,179
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
MEDICAL FACILITIES MANAGEMENT - 0.5%
Fresenius Medical Care AG sponsored ADR (a) 116,977 $ 3,539
Health Images, Inc. 112,000 1,750
Physician Reliance Network, Inc. (a) 153,000 1,071
6,360
TOTAL HEALTH 41,051
INDUSTRIAL MACHINERY & EQUIPMENT - 3.2%
ELECTRICAL EQUIPMENT - 0.6%
American Power Conversion Corp. (a) 23,400 554
Cymer, Inc. 3,900 130
Westinghouse Electric Corp. 409,900 7,686
8,370
INDUSTRIAL MACHINERY & EQUIPMENT - 2.4%
Culligan Water Technologies, Inc. (a) 94,700 3,528
Duriron Co., Inc. 230,800 6,232
Gardner Denver Machinery, Inc. (a) 30,100 1,099
Goulds Pumps, Inc. 123,700 3,046
Ionics, Inc. (a) 53,900 2,601
Lindsay Manufacturing Co. 82,800 3,395
Manitowoc Co., Inc. 191,500 8,402
Twin Disc, Inc. 43,400 939
Ultratech Stepper, Inc. 11,700 266
Valmont Industries, Inc. 13,000 510
30,018
POLLUTION CONTROL - 0.2%
TETRA Technologies, Inc. (a) 14,700 274
United Waste Systems, Inc. (a) 58,300 1,953
2,227
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 40,615
MEDIA & LEISURE - 4.2%
BROADCASTING - 0.8%
American Radio Systems Corp. Class A (a) 79,000 2,173
Clear Channel Communications, Inc. (a) 48,000 3,312
Home Shopping Network, Inc. (a) 68,800 774
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - CONTINUED
BROADCASTING - CONTINUED
Infinity Broadcasting Corp. Class A 48,950 $ 1,573
Westwood One, Inc. 165,000 2,743
10,575
LEISURE DURABLES & TOYS - 0.3%
Ag-Chem Equipment, Inc. (a) 38,500 587
Sports and Recreation, Inc. (a) 177,700 1,533
West Marine, Inc. (a) 62,400 2,090
4,210
LODGING & GAMING - 1.5%
Dover Downs Entertainment, Inc. (a) 59,700 1,239
International Game Technology Corp. 254,700 4,967
International Speedway Corp.:
Class A (a) 24,300 486
Class B 132,900 2,724
Speedway Motorsports (a) 418,900 9,059
18,475
PUBLISHING - 1.5%
Gibson Greetings, Inc. 4,400 83
Harcourt General, Inc. 53,200 2,906
Meredith Corp. 16,000 824
Playboy Enterprises, Inc. Class B (a) 66,100 785
Times Mirror Co. Class A 242,500 12,701
Wolters Kluwer NV 11,705 1,529
18,828
RESTAURANTS - 0.1%
Foodmaker, Inc. (a) 86,900 793
Roadhouse Grill, Inc. 94,300 566
1,359
TOTAL MEDIA & LEISURE 53,447
NONDURABLES - 2.5%
AGRICULTURE - 1.1%
DEKALB Genetics Corp. Class B 96,600 3,598
Molinos Rio de La Plata SA Class B (Reg.) 227,791 747
Pioneer Hi-Bred International, Inc. 125,200 8,733
13,078
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONDURABLES - CONTINUED
BEVERAGES - 0.0%
Zaklady Piwowarskie W Zywcu SA 2,648 $ 129
FOODS - 1.3%
Golden Poultry Co., Inc. 10,000 98
Hudson Foods, Inc. Class A 168,500 3,075
Pilgrims Pride Corp. 89,100 780
Riviana Foods, Inc. 16,600 299
Sanderson Farms, Inc. 97,900 1,554
Savanna Foods & Industries, Inc. 17,500 249
Smithfield Foods, Inc. (a) 60,700 1,973
Stokeley USA, Inc. (a) 52,200 101
Tyson Foods, Inc. 265,600 8,698
16,827
HOUSEHOLD PRODUCTS - 0.1%
Nu Skin Asia Pacific, Inc. Class A 1,600 47
Scholl PLC 229,300 1,151
1,198
TOBACCO - 0.0%
Souza Cruz Industria Comerico 50,000 285
TOTAL NONDURABLES 31,517
RETAIL & WHOLESALE - 5.5%
APPAREL STORES - 0.4%
Brown Group, Inc. 75,700 1,438
Harolds Stores, Inc. (a) 29,200 445
Saks Holdings, Inc. (a) 109,300 3,552
5,435
DRUG STORES - 0.3%
Arbor Drugs, Inc. 25,400 654
CVS Corp. 49,300 2,027
Genovese Drug Stores, Inc. Class A 32,400 567
Revco (D.S.), Inc. 11,700 404
Rite Aid Corp. 11,700 464
4,116
GENERAL MERCHANDISE STORES - 1.4%
Carrefour Supermarche SA 1,600 988
Matahari Putra Prima PT (For. Reg.) 2,075,000 2,345
Mercantile Stores Co., Inc. 15,700 789
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
GENERAL MERCHANDISE STORES - CONTINUED
Neiman-Marcus Group, Inc. (a) 221,500 $ 7,697
Nordstrom, Inc. 113,800 4,950
Value City Department Stores, Inc. (a) 48,000 612
Woolworth Corp. (a) 19,400 466
17,847
GROCERY STORES - 2.3%
Ahold NV 10,000 625
Food Lion, Inc.:
Class A 2,350,400 21,154
Class B 100,000 894
Koninklijke Ahold NV sponsored ADR 19,500 1,216
Quality Food Centers, Inc. (a) 43,900 1,674
Whole Foods Market, Inc. (a) 158,600 3,588
29,151
RETAIL & WHOLESALE, MISCELLANEOUS - 1.1%
Amway Asia Pacific Ltd. 1,300 52
Best Buy Co., Inc. (a) 35,300 446
New West Eyeworks, Inc. 26,300 184
Tiffany & Co., Inc. 350,400 12,921
13,603
TOTAL RETAIL & WHOLESALE 70,152
SERVICES - 3.6%
ADVERTISING - 0.4%
CMG Information Services, Inc. (a) 283,900 4,507
Lamar Advertising Co. Class A (a) 28,500 663
5,170
EDUCATIONAL SERVICES - 0.4%
Apollo Group, Inc. Class A (a) 214,272 5,544
LEASING & RENTAL - 0.0%
Team Rental Group, Inc. Class A (a) 18,800 306
PRINTING - 0.2%
United Stationers, Inc. (a) 133,500 2,703
SERVICES - 2.6%
Coach USA, Inc. (a) 24,100 609
Devry, Inc. (a) 101,500 4,529
Employee Solutions, Inc. (a) 48,300 894
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
SERVICES - CONTINUED
SERVICES - CONTINUED
Gartner Group, Inc. Class A (a) 249,100 $ 9,092
Loewen Group, Inc. 31,100 1,252
National Education Corp. (a) 279,300 3,945
Norrell Corp 10,300 238
Precision Response Corp. (a) 700 26
Regis Corp. 42,900 1,073
Romac International, Inc. (a) 23,400 573
Sitel Corp. (a) 66,800 1,319
Sotheby's Holdings, Inc. Class A 496,500 8,751
32,301
TOTAL SERVICES 46,024
TECHNOLOGY - 44.6%
COMMUNICATIONS EQUIPMENT - 6.3%
ADC Telecommunications, Inc. (a) 186,000 6,743
Andrew Corp. (a) 110,000 6,366
Ascend Communications, Inc. (a) 48,300 3,435
Aspect Telecommunications Corp. (a) 86,400 4,709
Cisco Systems, Inc. (a) 277,400 18,829
Dynatech Corp. (a) 16,500 771
Lucent Technologies, Inc. 179,300 9,189
MOSCOM Corp. 31,300 297
Nokia Corp. AB sponsored ADR 58,500 3,283
Pairgain Technologies, Inc. (a) 278,000 17,757
Periphonics Corp. (a) 2,000 41
Tellabs, Inc. (a) 183,400 7,290
3Com Corp. 11,700 879
79,589
COMPUTER SERVICES & SOFTWARE - 14.8%
Acxiom Corp. (a) 63,000 1,445
Affiliated Computer Services, Inc. Class A (a) 129,200 3,747
Analysts International Corp. 3,600 97
BMC Software, Inc. (a) 34,200 1,488
BancTec, Inc. (a) 159,400 3,168
Barra, Inc. (a) 104,300 2,712
CBT Group PLC sponsored ADR (a) 34,800 2,001
Cadence Design Systems, Inc. (a) 321,200 12,808
Citrix Systems, Inc. (a) 384,600 17,547
Claremont Technology Group, Inc. (a) 9,700 238
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - CONTINUED
Clarify, Inc. (a) 217,100 $ 9,770
CompUSA, Inc. (a) 94,000 4,230
Computer Task Group, Inc. 11,400 477
Compuware Corp. (a) 113,000 6,385
Cybercash, Inc. (a) 14,000 354
Data Transmission Network Corp. (a) 102,900 2,238
Desktop Data, Inc. (a) 230,000 5,175
Dynamics Research Corp. (a) 5,200 50
Equifax, Inc. 21,000 688
FactSet Research Systems, Inc. (a) 53,600 1,260
Fair, Isaac & Co., Inc. 27,800 973
Fiserv, Inc. (a) 20,200 763
Forte Software, Inc. (a) 13,000 413
Henry (Jack) & Associates, Inc. 99,333 3,775
Keane, Inc. (a) 347,400 9,184
Legato Systems, Inc. (a) 78,500 2,748
Lycos, Inc. (a) 46,100 536
MARC, Inc. 12,300 261
Manugistics Group, Inc. (a) 4,900 183
McAfee Associates, Inc. (a) 55,650 2,657
Microsoft Corp. (a) 93,100 14,605
Open Market, Inc. (a) 47,300 671
Pegasystems, Inc. (a) 8,400 251
PeopleSoft, Inc. (a) 201,600 9,223
Primark Corp. (a) 39,800 1,045
Pure Atria Corp. (a) 195,995 5,463
Saville Systems Ireland PLC sponsored ADR (a) 46,800 1,948
Scopus Technology, Inc. (a) 67,700 2,530
Sykes Enterprises, Inc. (a) 13,200 574
Synopsys, Inc. (a) 164,100 7,261
Transaction Systems Architects (a) 54,500 1,976
Transition Systems, Inc. (a) 19,200 216
Tripos, Inc. (a) 64,000 1,024
Triteal Corp. (a) 22,400 347
Vanstar Corp. (a) 13,500 368
Vantive Corp. (a) 535,400 18,471
Viasoft, Inc. (a) 522,500 23,643
Wind River Systems, Inc. 3,900 192
187,179
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTERS & OFFICE EQUIPMENT - 11.3%
Applied Magnetics Corp. (a) 210,300 $ 5,757
Bay Networks, Inc. 155,500 4,160
Comdisco, Inc. 74,600 2,425
Compaq Computer Corp. (a) 318,700 25,257
Diebold, Inc. 254,075 15,149
Digital Equipment Corp. 9,700 356
EMC Corp. (a) 658,400 21,233
Hutchinson Technology, Inc. (a) 115,400 6,087
International Business Machines Corp. 15,800 2,518
Itron, Inc. (a) 11,700 228
Micron Electronics, Inc. (a) 277,800 5,348
Quantum Corp. (a) 400,900 10,724
SCI Systems, Inc. (a) 58,900 3,107
Seagate Technology (a) 547,400 21,622
Tech Data Corp. (a) 76,600 2,298
Western Digital Corp. (a) 326,700 17,560
143,829
ELECTRONIC INSTRUMENTS - 1.8%
Cognex Corp. (a) 11,700 231
Fluke Corp. 7,800 336
KLA Instruments Corp. (a) 368,200 13,071
Kulicke & Soffa Industries, Inc. 19,500 395
Lam Research Corp. (a) 49,600 1,779
Lernout & Hauspie Speech Products NV (a) 35,100 693
Teradyne, Inc. (a) 247,500 5,847
22,352
ELECTRONICS - 10.2%
Altera Corp. (a) 43,000 3,247
Analog Devices, Inc. (a) 113,600 3,649
Atmel Corp. (a) 89,800 2,952
Cirrus Logic, Inc. (a) 216,000 4,239
Etec Systems, Inc. (a) 44,800 1,316
Integrated Packaging Assembly Corp. (a) 60,300 482
Intel Corp. 391,900 49,722
Kent Electronics Corp. (a) 58,700 1,534
Linear Technology Corp. 123,500 5,820
Maxim Integrated Products, Inc. (a) 251,200 11,649
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
ELECTRONICS - CONTINUED
Microchip Technology, Inc. 40,800 $ 1,948
Micron Technology, Inc. 313,900 10,398
National Semiconductor Corp. (a) 629,000 15,411
Storage Technology Corp. (a) 103,400 5,157
Supertex, Inc. (a) 135,200 2,569
Vitesse Semiconductor Corp. (a) 11,100 530
Xilinx, Inc. (a) 202,200 8,872
Zilog, Inc. 11,700 262
129,757
PHOTOGRAPHIC EQUIPMENT - 0.2%
Leica Camera AG (a) 49,100 1,533
Panavision, Inc. 74,900 1,676
3,209
TOTAL TECHNOLOGY 565,915
TRANSPORTATION - 1.5%
AIR TRANSPORTATION - 1.1%
Alaska Air Group, Inc. (a) 365,900 8,827
Continental Airlines, Inc. Class B (a) 147,200 4,177
USAir Group, Inc. 15,500 360
13,364
TRUCKING & FREIGHT - 0.4%
Expeditors International of Washington, Inc. 110,100 4,899
M.S. Carriers, Inc. (a) 28,100 534
5,433
TOTAL TRANSPORTATION 18,797
UTILITIES - 1.8%
CELLULAR - 0.2%
McLeod, Inc. (a) 37,700 1,074
Nordictel Holdings AB (a) 92,600 1,916
2,990
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - CONTINUED
ELECTRIC UTILITY - 0.6%
Black Hills Corp. 35,400 $ 912
CILCORP, Inc. 27,600 1,007
Portland General Corp. 102,100 4,390
Veba AG Ord. 12,300 720
7,029
GAS - 0.2%
Enron Corp. 53,400 2,443
TELEPHONE SERVICES - 0.8%
LCI International, Inc. (a) 44,700 1,458
MFS Communications, Inc. 33,300 1,607
Midcom Communications, Inc. (a) 67,000 762
Telecom Argentina Class B sponsored ADR 18,900 744
Telebras sponsored ADR 74,200 5,621
10,192
TOTAL UTILITIES 22,654
TOTAL COMMON STOCKS
(Cost $946,382) 1,196,217
NONCONVERTIBLE PREFERRED STOCKS - 0.3%
HEALTH - 0.0%
MEDICAL FACILITIES MANAGEMENT - 0.0%
Fresenius National Medical Care, Inc. Class D
(special dividends) (a) 107,500 14
UTILITIES - 0.3%
TELEPHONE SERVICES - 0.3%
Telecom Italia Mobile Spa de Risp 2,700,000 3,592
TOTAL NONCONVERTIBLE PREFERRED STOCKS
(Cost $3,772) 3,606
CASH EQUIVALENTS - 5.4%
Taxable Central Cash Fund (b)
(Cost $68,499) 68,499,067 68,499
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,018,653) $ 1,268,322
LEGEND
1. Non-income producing
2. At period end, the seven-day yield on the Taxable Central Cash Fund was
5.46%. The yield refers to the income earned by investing in the fund over
the seven-day period, expressed as an annual percentage.
INCOME TAX INFORMATION
At November 30, 1996, the aggregate cost of investment securities for
income tax purposes was $1,019,576,000. Net unrealized appreciation
aggregated $248,746,000, of which $270,600,000 related to appreciated
investment securities and $21,854,000 related to depreciated investment
securities.
The fund hereby designates approximately $17,499,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNTS) NOVEMBER 30, 1996
ASSETS
Investment in securities, at value (cost $1,018,653) - $ 1,268,322
See accompanying schedule
Receivable for investments sold 10,435
Receivable for fund shares sold 1,432
Dividends receivable 411
Interest receivable 158
Other receivables 17
TOTAL ASSETS 1,280,775
LIABILITIES
Payable for investments purchased $ 10,333
Payable for fund shares redeemed 2,667
Accrued management fee 768
Other payables and accrued expenses 463
TOTAL LIABILITIES 14,231
NET ASSETS $ 1,266,544
Net Assets consist of:
Paid in capital $ 967,796
Accumulated undistributed net realized gain (loss) on 49,080
investments and foreign currency transactions
Net unrealized appreciation (depreciation) on 249,668
investments and assets and liabilities in foreign
currencies
NET ASSETS, for 60,920 shares outstanding $ 1,266,544
NET ASSET VALUE and redemption price per share $20.79
($1,266,544 (divided by) 60,920 shares)
Maximum offering price per share (100/97.00 of $20.79) $21.43
STATEMENT OF OPERATIONS
AMOUNTS IN THOUSANDS YEAR ENDED NOVEMBER 30, 1996
INVESTMENT INCOME $ 4,562
Dividends
Interest 3,643
TOTAL INCOME 8,205
EXPENSES
Management fee $ 6,279
Basic fee
Performance adjustment 775
Transfer agent fees 2,281
Accounting fees and expenses 439
Non-interested trustees' compensation 3
Custodian fees and expenses 87
Registration fees 348
Audit 41
Legal 18
Miscellaneous 6
Total expenses before reductions 10,277
Expense reductions (435) 9,842
NET INVESTMENT INCOME (LOSS) (1,637)
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 50,155
Foreign currency transactions (19) 50,136
Change in net unrealized appreciation (depreciation) on 149,757
investment securities
NET GAIN (LOSS) 199,893
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 198,256
FROM OPERATIONS
STATEMENT OF CHANGES IN NET ASSETS
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED YEAR ENDED
NOVEMBER 30, NOVEMBER 30,
1996 1995
INCREASE (DECREASE) IN NET ASSETS
Operations $ (1,637) $ (524)
Net investment income (loss)
Net realized gain (loss) 50,136 67,569
Change in net unrealized appreciation (depreciation) 149,757 77,248
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 198,256 144,293
FROM OPERATIONS
Distributions to shareholders from net realized gains (45,174) (7,211)
Share transactions 1,631,213 507,890
Net proceeds from sales of shares
Reinvestment of distributions 44,305 7,119
Cost of shares redeemed (1,105,709) (420,641)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 569,809 94,368
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 722,891 231,450
NET ASSETS
Beginning of period 543,653 312,203
End of period $ 1,266,544 $ 543,653
OTHER INFORMATION
Shares
Sold 89,123 32,962
Issued in reinvestment of distributions 2,688 612
Redeemed (60,913) (28,933)
Net increase (decrease) 30,898 4,641
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
YEARS ENDED NOVEMBER 30,
1996 1995 1994 G 1993 F
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 18.11 $ 12.30 $ 11.97 $ 10.00
Income from Investment Operations
Net investment income (loss) (.03) D (.02) D, (.01) D (.01)
E
Net realized and unrealized gain (loss) 4.15 6.12 .64 1.98
Total from investment operations 4.12 6.10 .63 1.97
Less Distributions
From net realized gain (1.44) (.29) (.30) -
Net asset value, end of period $ 20.79 $ 18.11 $ 12.30 $ 11.97
TOTAL RETURN B, C 24.88% 50.92% 5.33% 19.70%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in millions) $ 1,267 $ 544 $ 312 $ 254
Ratio of expenses to average net assets 1.07% 1.20% 1.32% 1.34% A
Ratio of expenses to average net assets 1.03% 1.18% 1.29% 1.32% A,
after expense reductions H H H H
Ratio of net investment income (loss) to (.17)% (.15)% (.05)% (.10)%
average net assets A
Portfolio turnover rate 158% 176% 199% 204% A
Average commission rate I $ .0368
</TABLE>
A ANNUALIZED
B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO
FINANCIAL STATEMENTS).
C TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
D NET INVESTMENT INCOME (LOSS) PER SHARE HAS BEEN CALCULATED BASED ON
AVERAGE SHARES OUTSTANDING DURING THE PERIOD.
E INVESTMENT INCOME (LOSS) PER SHARE REFLECTS A SPECIAL DIVIDEND WHICH
AMOUNTED TO $0.01 PER SHARE.
F FOR THE PERIOD DECEMBER 28, 1992 (COMMENCEMENT OF OPERATIONS) TO NOVEMBER
30, 1993.
G 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, NET INVESTMENT INCOME (LOSS) PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
H FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS).
I FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
NOTES TO FINANCIAL STATEMENTS
For the period ended November 30, 1996
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. Effective the close of business on May 15, 1996, the fund was
closed to new accounts. The trust is registered under the Investment
Company Act of 1940, as amended (the 1940 Act), as an open-end management
investment company organized as a Massachusetts business trust. The
financial statements have been prepared in conformity with generally
accepted accounting principles which permit management to make certain
estimates and assumptions at the date of the financial statements. The
following summarizes the significant accounting policies of the fund:
SECURITY VALUATION. 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 with remaining maturities of sixty days or less for which
quotations are not readily available are valued at amortized cost or
original cost plus accrued interest, both of which approximate current
value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated
in a foreign currency are translated into U.S. dollars at the prevailing
rates of exchange at period end. Income receipts and expense payments are
translated into U.S. dollars at the prevailing exchange rate on the
respective dates of the transactions. Purchases and sales of securities are
translated into U.S. dollars at the contractual currency exchange rates
established at the time of each trade.
Net realized gains and losses on foreign currency transactions represent
net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, and the difference between
the amount of net investment income accrued and the U.S. dollar amount
actually received. The effects of changes in foreign currency exchange
rates on investments in securities are included with the net realized and
unrealized gain or loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes substantially all of its taxable income for
its fiscal year. The schedule of investments includes information regarding
income taxes under the caption "Income Tax Information."
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. Non-cash dividends included in dividend income, if any,
are recorded at the fair
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
market value of the securities received. Interest income is accrued as
earned. Investment 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.
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 foreign
currency transactions, non-taxable dividends and losses deferred due to
wash sales. The fund also utilized earnings and profits distributed to
shareholders on redemption of shares as a part of the dividends paid
deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net investment income and realized
and unrealized gain (loss). Accumulated undistributed net realized gain
(loss) on investments and foreign currency transactions may include
temporary book and tax basis differences which will reverse in a subsequent
period. Any taxable income or gain remaining at fiscal year end is
distributed in the following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign securities. Losses may
arise from changes in the value of the foreign currency or if the
counterparties do not perform under the contracts' terms. The U.S. dollar
value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission(the SEC), the fund, 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 for U.S. Treasury or
Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account,
2. OPERATING POLICIES -
CONTINUED
REPURCHASE AGREEMENTS -
CONTINUED
at a bank custodian. The securities are marked-to-market daily and
maintained at a value at least equal to the principal amount of the
repurchase agreement (including accrued interest). FMR, the fund's
investment adviser, is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by the
SEC, the fund may invest in the Taxable Central Cash Fund (the Cash Fund)
managed by FMR. The Cash Fund is an open-end money market fund available
only to investment companies and other accounts managed by FMR and its
affiliates. The Cash Fund seeks preservation of capital, liquidity, and
current income by investing in U.S. Treasury securities and repurchase
agreements for these securities, and may be utilized by the fund as an
additional cash management option. Dividends from the Cash Fund are
declared daily and paid monthly from net interest income. Income
distributions received by the fund are recorded as interest income.
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $1,918,329,000 and $1,404,005,000,
respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
basic fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR. The
rates ranged from .2500% to .5200% for the period. In the event that these
rates were lower than the contractual rates in effect during the period,
FMR voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. The annual individual fund fee rate is .35%. The
basic fee is subject to a performance adjustment (up to a maximum of
(plus/minus) .20% of the fund's average net assets over the performance
period) based on the fund's investment performance as compared to the
appropriate index over a specified period of time. For the period, the
management fee was equivalent to an annual rate of .73% of average net
assets after the performance adjustment.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
SALES LOAD. For the period, Fidelity Distributors Corporation (FDC), an
affiliate of FMR and the general distributor of the fund, received sales
charges of $6,189,000 on sales of shares of the fund.
TRANSFER AGENT FEES. Fidelity Service Co. (FSC), an affiliate of FMR, is
the fund's transfer, dividend disbursing and shareholder servicing agent.
FSC receives account fees and asset-based fees that vary according to
account size and type of account. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annual rate of .24%
of average net assets.
ACCOUNTING FEES. FSC maintains the fund's accounting records. The fee is
based on the level of average net assets for the month plus out-of-pocket
expenses.
BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid to these affiliated firms were $139,000 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
$420,000 under this arrangement.
In addition, the fund has entered into arrangements with its custodian and
transfer agent whereby interest earned on uninvested cash balances was used
to offset a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $6,000 and $9,000,
respectively, under these arrangements.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Mt. Vernon Street Trust and the Shareholders of
Fidelity New Millennium Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Mt. Vernon Street Trust: Fidelity New Millennium Fund, including
the schedule of portfolio investments, as of November 30, 1996, and the
related statement of operations for the year then ended, the statement of
changes in net assets for each of the two years in the period then ended
and the financial highlights for each of the three years in the period then
ended and for the period December 28, 1992 (commencement of operations) to
November 30, 1993. These financial statements and financial highlights are
the responsibility of the fund's management. Our responsibility is to
express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of November 30, 1996 by correspondence with the
custodian and brokers. An audit also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Mt. Vernon Street Trust: Fidelity New Millennium Fund as of
November 30, 1996, the results of its operations for the year then ended,
the changes in its net assets for each of the two years in the period then
ended, and the financial highlights for each of the three years in the
period then ended and for the period December 28, 1992 (commencement of
operations) to November 30, 1993, in conformity with generally accepted
accounting principles.
/s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
January 3, 1997
DISTRIBUTIONS
The Board of Trustees of Fidelity New Millenium Fund voted to pay to
shareholders of record at the opening of business on record date, the
following distributions derived from capital gains realized from sales of
portfolio securities:
PAY DATE RECORD DATE CAPITAL GAINS
12/16/96 12/13/96 $.51
1/6/97 1/3/97 $.04
A total of 6% of the dividends distributed during the fiscal year qualifies
for the dividends-received deduction for corporate shareholders.
The fund will notify shareholders in January 1997 of the applicable
percentage for use in preparing 1996 income tax returns.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a day.
BY PHONE
Fidelity TouchTone Xpressprovides a single toll-free number to access
account balances, positions, quotes and trading. It's easy to navigate the
service, and on your first call, the system will help you create a personal
identification number (PIN) for security.
SM
(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
1
For quotes.*
2
For account balances and holdings.
3
To review orders and mutual
fund activity.
4
To change your PIN.
5
To speak to a Fidelity representative.
*
0
BY PC
Fidelity's Web site on the Internet provides a wide range of information,
including daily financial news, fund performance, interactive planning
tools and news about Fidelity products and services.
(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at 1-800-544-7272
for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity at
1-800-544-7272 or visit our Web site for more information on how to manage
your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT
IN A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and send
you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
100 Crosby Parkway - KP2C
Covington, KY 41015-4399
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6I
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
851 East Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
811 Wilshire Boulevard
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
950 Northgate Drive
San Rafael, CA
1400 Civic Drive
Walnut Creek, CA
6300 Canoga Avenue
Woodland Hills, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
29 South Main Street
West Hartford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
90 Alhambra Plaza
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
4001 Tamiami Trail, North
Naples, FL
1907 West State Road 434
Orlando, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
2000 66th Street, North
St. Petersburg, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
One North Franklin
Chicago, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
3232 Lake Avenue
Wilmette, IL
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
44 Mall Road
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
29155 Northwestern Hwy.
Southfield, MI
MINNESOTA
7600 France Avenue South
Edina, MN
MISSOURI
700 West 47th Street
Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
56 South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
505 Millburn Avenue
Short Hills, NJ
NEW YORK
1050 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
1271 Avenue of the
Americas
New York, NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
10 Bank Street
White Plains, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
1903 East Ninth Street
Cleveland, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
Dallas, TX
1155 Dairy Ashford
Houston, TX
2701 Drexel Drive
Houston, TX
1010 Lamar Street
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
UTAH
215 South State Street
Salt Lake City, UT
VERMONT
199 Main Street
Burlington, VT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
511 Pine Street
Seattle, WA
WASHINGTON, DC
1775 K Street, N.W.
Washington, DC
WISCONSIN
595 North Barker Road
Brookfield, WI
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research
(U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Neal Miller, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Robert H. Morrison, Manager,
Security Transactions
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
ADVISORY BOARD
William O. McCoy
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co., Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
Chase Manhattan Bank, N.A.
New York, NY
FIDELITY'S GROWTH FUNDS
Blue Chip Growth Fund
Capital Appreciation Fund
Contrafund
Disciplined Equity Fund
Dividend Growth Fund
Emerging Growth Fund
Export Fund
Fidelity Fifty
Growth Company Fund
Large Cap Stock Fund
Low-Priced Stock Fund
Magellan(registered trademark) Fund
Mid-Cap Stock Fund
New Millennium(trademark) Fund
OTC Portfolio
Retirement Growth Fund
Small Cap Stock Fund
Stock Selector
Trend Fund
Value Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE
