FIDELITY ADVISOR SERIES VI, N-30B-2, 1994-08-05

FIDELITY ADVISOR SERIES VI
N-30B-2, 1994-08-05

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(2_FIDELITY_LOGOS)FIDELITY ADVISOR
(registered trademark)

LIMITED TERM TAX-EXEMPT FUND - INSTITUTIONAL CLASS

SEMIANNUAL REPORT
MAY 31, 1994
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on bond market
strategies.

PERFORMANCE 4 How the fund has done over time.

FUND TALK 8 The manager's review of fund
performance, strategy and outlook.

INVESTMENT CHANGES 11 A summary of major shifts in the
fund's investments over the past six
months.

INVESTMENTS 12 A complete list of the fund's
investments with their market
values.

FINANCIAL STATEMENTS 18 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.

NOTES 23 Notes to the financial statements.

THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS
OF, OR
GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE
FDIC, THE
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT
RISK,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. NEITHER THE FUND NOR FIDELITY
DISTRIBUTORS
CORPORATION IS A BANK.
PRESIDENT'S MESSAGE

DEAR SHAREHOLDER:
The past few months have been an unsettling time for bond investors. The
bond market declined after the Federal Reserve Board raised short-term
interest rates in February through May. These rate hikes caused bond yields
to rise and bond prices to fall. While nobody knows whether rates will
continue to go up, this may be a good time to review the effect rising
rates have on your bond fund investment, and consider how well your current
bond fund holdings match your original investment goals.
Most investors choose bond funds to generate income and to help diversify
their investment portfolios. Despite the recent market downturn, bond
mutual funds still satisfy these needs. Where investors have felt the
negative effect of rising rates is in the market value of their investment,
which has eroded as bond prices have fallen. It's important
to remember, however, that this loss in principal is only "on paper" until
you choose to sell your shares. That's why your investing time horizon is
key.
If your time horizon is short - one year or less - you may want to consider
shifting all or part of your bond fund investment into short-term
investments.
If you don't need your money within the next year, staying in your bond
fund may be the appropriate strategy for you. The longer your investing
time frame, the better your chances of retaining your principal investment
through periods of rising AND falling rates. For example, if you plan to
use your money in one to two years, a short-term bond fund may be the right
choice. If your time frame is two to four years, a fund with an
intermediate length average maturity may be best. If you have a longer-term
goal - say a child's college education that's 10 years away - you may be
willing to ride out the bond market's peaks and valleys in exchange for the
higher potential returns of a longer-term fund.
Remember to contact your investment professional if you need help with your
investments.
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 $100,000 investment. Each figure
includes changes in a fund's share price, reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells bonds
that have grown in value). You can also look at the fund's income. If
Fidelity had not reimbursed certain fund expenses during the period shown,
the total returns and yield dividends would have been lower.
CUMULATIVE TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
PERIODS ENDED MAY 31, 1994 PAST 6 PAST 1 PAST 5 LIFE OF
MONTHS YEAR YEARS FUND

Advisor Limited Term Tax-Exempt -
Institutional -1.97% 1.59% 38.55% 86.17%
Class

Lehman Brothers Municipal Bond Index -1.83% 2.47% 48.85% n/a

Average Intermediate Municipal Bond Fund -1.10% 2.94% 42.63% n/a

Consumer Price Index 1.17% 2.29% 19.14% 36.20%

</TABLE>

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years or since
the fund started on September 19, 1985. You can compare the fund's returns
to the performance of the Lehman Brothers Municipal Bond Index - a broad
measure of the municipal bond market. To measure how the fund stacked up
against its peers, you can look at the average intermediate municipal bond
fund, which reflects the performance of 87 similar funds tracked by Lipper
Analytical Services. Both benchmarks include reinvested dividends and
capital gains, if any. Comparing the fund's performance to the consumer
price index helps show how your fund did compared to inflation. (The CPI
returns begin on the month end closest to the fund's start date).
AVERAGE ANNUAL TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED MAY 31, 1994 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND

Advisor Limited Term Tax-Exempt - Institutional Class 1.59% 6.74% 7.40%

Lehman Brothers Municipal Bond Index 2.47% 8.28% n/a

Average Intermediate Municipal Bond Fund 2.94% 7.36% n/a

Consumer Price Index 2.29% 3.57% 3.63%

</TABLE>

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.
$100,000 OVER LIFE OF FUND
FA Ltd Term Tax-Exempt Inst'l (089) LB Municipal Bond Index
09/30/85 100000.00 100000.00
10/31/85 102557.17 103427.00
11/30/85 104518.69 107136.93
12/31/85 104786.60 108078.66
01/31/86 108552.94 114444.49
02/28/86 110379.00 118983.36
03/31/86 111068.09 119021.44
04/30/86 111554.79 119111.89
05/31/86 110562.29 117172.75
06/30/86 111676.16 118290.58
07/31/86 111960.20 119008.60
08/31/86 115655.60 124336.62
09/30/86 116142.84 124648.70
10/31/86 118558.41 126801.39
11/30/86 119558.58 129313.32
12/31/86 119157.22 128956.42
01/31/87 121284.50 132839.29
02/28/87 122646.62 133492.86
03/31/87 122005.68 132077.84
04/30/87 117021.26 125450.17
05/31/87 116948.38 124827.94
06/30/87 119132.24 128492.89
07/31/87 120529.58 129803.52
08/31/87 120788.80 130095.57
09/30/87 116934.49 125298.95
10/31/87 118019.84 125742.51
11/30/87 120723.75 129025.65
12/31/87 121929.14 130897.81
01/31/88 126301.52 135560.39
02/29/88 126816.72 136993.26
03/31/88 124962.61 135397.29
04/30/88 125590.80 136426.31
05/31/88 125988.19 136032.04
06/30/88 126873.83 138022.19
07/31/88 127533.91 138922.09
08/31/88 127595.01 139044.34
09/30/88 128995.05 141561.04
10/31/88 130529.61 144059.60
11/30/88 130104.96 142740.01
12/31/88 130925.92 144200.24
01/31/89 132250.96 147182.30
02/28/89 131461.10 145502.95
03/31/89 131044.18 145155.20
04/30/89 132896.36 148601.18
05/31/89 134880.89 151687.63
06/30/89 136361.27 153747.55
07/31/89 137722.05 155840.05
08/31/89 137275.93 154314.38
09/30/89 137248.73 153851.44
10/31/89 138349.44 155728.42
11/30/89 139863.14 158453.67
12/31/89 141123.85 159752.99
01/31/90 140663.54 159002.15
02/28/90 141912.63 160417.27
03/31/90 142154.36 160465.40
04/30/90 140692.55 159310.05
05/31/90 143257.68 162783.00
06/30/90 144443.75 164215.49
07/31/90 146186.91 166629.46
08/31/90 145336.94 164213.34
09/30/90 145726.19 164311.86
10/31/90 147355.87 167285.91
11/30/90 149706.93 170648.35
12/31/90 150110.98 171399.21
01/31/91 151787.12 173695.96
02/28/91 153169.06 175207.11
03/31/91 153271.95 175277.19
04/30/91 154661.41 177608.38
05/31/91 155900.42 179189.10
06/30/91 155995.13 179009.91
07/31/91 157557.65 181193.83
08/31/91 158816.61 183585.59
09/30/91 159790.00 185972.20
10/31/91 161505.94 187645.95
11/30/91 161912.98 188171.36
12/31/91 164588.49 192217.04
01/31/92 165738.28 192659.14
02/29/92 165928.38 192716.94
03/31/92 165293.92 192794.03
04/30/92 166450.08 194509.89
05/31/92 168275.74 196805.11
06/30/92 170484.17 200111.43
07/31/92 174155.80 206114.78
08/31/92 172868.15 204094.85
09/30/92 174482.74 205421.47
10/31/92 173291.12 203408.34
11/30/92 176493.82 207049.35
12/31/92 176574.06 209161.25
01/31/93 178797.36 211587.52
02/28/93 183621.14 219246.99
03/31/93 181839.17 216922.97
04/30/93 183152.45 219113.89
05/31/93 183959.36 220340.93
06/30/93 185942.62 224020.63
07/31/93 186375.30 224311.85
08/31/93 189674.70 228977.54
09/30/93 191683.52 231587.88
10/31/93 192088.91 232027.90
11/30/93 190636.55 229986.05
12/31/93 194119.95 234838.76
01/31/94 195964.39 237515.92
02/28/94 190932.77 231364.26
03/31/94 183517.53 221947.73
04/30/94 185180.13 223834.29
05/31/94 186876.97 225781.65

$100,000 OVER LIFE OF FUND: Let's say you invested $100,000 in Fidelity
Advisor Limited Term Tax-Exempt - Institutional Class on September 30,
1985, shortly after the fund started. As the chart shows, by May 31, 1994,
the value of your investment with dividends reinvested would have grown to
$186,877 - a 86.88% increase on your initial investment. For comparison,
look at how the Lehman Brothers Municipal Bond Index did over the same
period. With dividends reinvested, the same $100,000 would have grown to
$225,782 - a 125.78% increase.

UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, move in the
opposite direction of interest
rates. In turn, the share price,
return, and yield of a fund
that invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
On September 10, 1992, the fund began offering Class A shares. All
performance information for Class A prior to September 10, 1992 does not
reflect Class A's 12b-1 fee and revised transfer agent fee arrangements,
which if included, would lower Class A's performance.
For the period ending May 31, 1994, Fidelity Advisor Limited Term
Tax-Exempt - Class A (Class A) shares' cumulative total returns were
- -2.10%, 1.21%, 37.94%, and 85.35%, for six months, one year, five years,
and life of fund, respectively. Class A shares' average annual total
returns (which include the effect of the 4.75% sales charge) were -3.60%,
5.61%, and 6.75% for one year, five years, and life of fund, respectively.
Cumulative total returns for Class A shares for the one year period ended
November 30, 1993, 1992, 1991, 1990 and 1989 were 7.72%, 8.96%, 8.15%,
7.04%, and 7.50%, respectively.
TOTAL RETURN COMPONENTS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SIX
MONTHS
ENDED YEARS ENDED NOVEMBER 30,
MAY 31,

1994 1993 1992 1991 1990 1989

Dividend return 2.25% 5.41% 6.42% 6.65% 6.76% 6.64%

Capital appreciation -4.22% 2.60% 2.59% 1.50% 0.28% 0.86%
return

Total return -1.97% 8.01% 9.01% 8.15% 7.04% 7.50%

</TABLE>

DIVIDEND returns and capital appreciation returns are both part of a bond
fund's total return. A dividend return reflects the actual dividends paid
by the fund. A capital appreciation return reflects both the amount paid by
the fund to shareholders as capital gain distributions and changes in the
fund's share price. Both returns assume the dividends or gains are
reinvested.
DIVIDENDS AND YIELD

<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED MAY 31, 1994 PAST PAST 6 PAST 1
MONTH MONTHS YEAR

Dividends per share 4.12(cents) 23.74(cents) 49.10(cents)

Annualized dividend rate 4.89% 4.64% 4.73%

30-day annualized yield 4.87% n/a n/a

30-day annualized tax-equivalent yield 7.06% n/a n/a

</TABLE>

DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $9.93 over
the past month, $10.27 over the past six months and $10.38 over the past
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all funds based on the
yields of the bonds in the fund, averaged over the past 30 days. This
figure shows you the yield characteristics of the fund's investments at the
end of the period. It also helps you compare funds from different companies
on an equal basis. The tax-equivalent yield shows what you would have to
earn on a taxable investment to equal the fund's tax-free yield, if you're
in the 31% federal tax bracket. If Fidelity had not reimbursed certain fund
expenses during the period shown, the yield and tax-equivalent yield would
have been 4.72% and 6.84%, respectively. Class A shares' 30-day yield
annualized yield was 4.40% and the 30-day annualized tax-equivalent yield
was 6.38%. If Fidelity had not reimbursed certain fund expenses during the
period shown, Class A shares' yield and tax-equivalent yield would have
been 4.24% and 6.14%, respectively.
FUND TALK: THE MANAGER'S OVERVIEW

An interview with John Haley,
Portfolio Manager of Fidelity Advisor Limited Term Tax-Exempt Fund
Q. JACK, HOW HAS THE FUND PERFORMED?
A. It was a rough period for both the municipal bond market and the fund.
For the six months ended May 31, 1994, Fidelity Advisor Limited Term
Tax-Exempt Fund - Institutional Class had a total return of -1.97%. That
lagged the average intermediate municipal fund, which returned -1.10% for
the same period, according to Lipper Analytical Services. For the 12 months
ended May 31, 1994, the fund returned 1.59%, compared to the average return
of 2.94%, again according to Lipper.
Q. WHAT CAUSED THE MUNICIPAL BOND MARKET TO FALL OVER THE PAST SIX MONTHS?
A. Interest rates, which typically move in the opposite direction of
municipal bond prices, generally rose during the past six months. By
mid-November, fears of inflation caused interest rates to rise slightly,
after having fallen during most of 1993. Until the end of January, rates
moved within a narrow range. During this period, the Federal Reserve Board
seemed content to keep the federal funds rate - the rate banks charge each
other for overnight loans - at 3.00%, where it had been since September
1992. On February 4, the Fed reversed that policy, raising the fed funds
rate to 3.25%. And through May, the Fed moved three more times, raising fed
funds to 4.25%. The Fed rate hikes were a preemptive strike against
inflation. The economy appeared to be heating up and the Fed seemed
determined to keep inflation in check. However, the moves still worried
bond investors, who dislike any mention of inflation because it erodes the
value of their bonds' interest income, which is paid at a fixed rate. As a
result, bond prices fell from February through early May. In recent weeks,
though, the market has started to stabilize.
Q. WHY DID THE FUND LAG THE AVERAGE FUND?
A. Primarily because it had a longer duration, which is a measure of the
fund's sensitivity to interest rate changes. The longer the duration, the
more sensitive the fund. Going into 1994, I thought the economic growth
would be moderate and inflation would stay low, eliminating any real need
on the part of the Fed to raise rates. In addition, I believed that supply
and demand factors would work in municipal bonds' favor. The rate of
municipal bonds issued in 1994 was expected to be half of what it was in
1993, and higher federal income taxes were expected to boost demand.
However, the expected positive effects of lower supply and higher demand
were stalled when the Fed moved on February 4. In the fourth quarter of
last year, having a longer duration helped the fund's performance. But once
rates started to rise, having a longer duration contributed most to the
fund's decline. To help hedge against some of that decline, I used futures
and options.
Q. THERE'S BEEN A LOT OF TALK LATELY ABOUT DERIVATIVES. AREN'T FUTURES AND
OPTIONS CONTRACTS TWO OF THE FINANCIAL ARRANGEMENTS KNOWN AS DERIVATIVES,
AND DO YOU USE OTHERS?
A. Yes, futures and options are two types of financial derivatives commonly
used and we've used both for several years. And as I mentioned earlier, we
used these contracts to help protect the fund from the market decline. As
bond prices fell, the futures and options contracts rose in value. Next to
futures and options, the most commonly used derivatives in the municipal
bond market are inverse floaters. These securities typically are created by
splitting a municipal bond into two parts: a tax-free money market
instrument yielding the prevailing short-term rate and a longer-term
security whose yield moves in the opposite direction when money market
rates change. The latter piece is called an inverse floater because its
coupon rises as short-term rates fall and vice versa. Inverse floaters,
which represented less than 3% of the fund's total assets at the end of
May, provide higher levels of tax-free income while allowing me to increase
the fund's sensitivity to interest rate changes. In contrast, I used
futures recently to reduce volatility. By using derivatives, I can achieve
a higher level of tax-free income, approximately twice the yield of a
regular fixed-rate bond, and increased flexibility in managing the fund's
duration.
Q. HOW HAVE YOU ALLOCATED THE FUND IN TERMS OF SECTORS AND STATES?
A. Electric revenue bonds and general obligation bonds make up the fund's
two largest sectors. Education bonds, which are primarily student loan
bonds, are the third largest sector concentration. In a generally flat
interest rate environment, which I'm expecting for the rest of the year,
student loan bonds can provide the fund with extra income. In terms of
state concentrations, California is still at the top of the list. While
these bonds didn't do as well as other states during the market's decline,
I think it's important to have a core position in the fund to take
advantage of future improvements in the state's economic and fiscal
situation.
Q. WHAT'S YOUR OUTLOOK OVER THE NEXT SIX MONTHS OR SO?
A. I think the worst may be over for municipal bonds, although there will
probably be some short-term volatility in the market. Lower interest rates
helped stimulate economic growth in 1993. In my opinion, higher interest
rates will keep the rate of economic growth more moderate in 1994. That
should keep interest rates relatively stable over the near term. From a
supply and demand standpoint, there are some positives. The volume of
municipal bonds issued from January through the end of May is down 38% from
a year ago. In addition, there were some bonds that were called, or
redeemed early, by their issuers in January and there will be even more
bonds called this July. Eventually, lower supply and even steady demand
could help boost municipal bond prices this year.
FUND FACTS
GOAL: to provide a high level
of current income exempt
from federal income taxes
START DATE: September 19,
1985
SIZE: as of May 31, 1994,
more than $70 million
MANAGER: Jack Haley, since
inception; joined Fidelity in
1981
(checkmark)
JACK HALEY'S INVESTMENT
PHILOSOPHY:
"The goal of the fund is to
generate between 80% and
90% of the yield available
from long-term municipal
bonds, with approximately
60% of the volatility of a
long-term bond fund. In
structuring the fund, I
evaluate a number of factors,
including our outlook for the
economy and interest rates.
Next, I focus on the yield
curve, spread relationships,
and individual security
selection. I start by analyzing
the slope of the yield curve, or
the difference between the
income that bonds of varying
maturities pay. If the yield
curve is flat, there usually isn't
much reward for buying
longer-term bonds. On the
other hand, if the yield curve
is steep, longer bonds pay
more in yield, and that yield
differential may be worth the
added risk. Next, I analyze
the spread relationships - or
the differences in yield and
prices - among securities
from various states, sectors
and coupons, looking to add
bonds that provide relative
value. Ultimately, individual
security selection is driven by
Fidelity's careful research of
each bond we own."
INVESTMENT CHANGES

TOP FIVE STATES AS OF MAY 31, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

California 12.6 14.2

Massachusetts 10.4 9.3

Texas 9.0 10.2

Florida 7.7 7.7

New York 5.0 3.2

TOP FIVE SECTORS AS OF MAY 31, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

Electric Revenue 16.9 10.3

General Obligation 16.4 15.5

Education 14.6 16.3

Health Care 13.7 20.4

Lease Revenue 6.6 10.6

AVERAGE YEARS TO MATURITY AS OF MAY 31, 1994
6 MONTHS AGO

Years 9.6 9.8

AVERAGE YEARS TO MATURITY SHOWS THE AVERAGE TIME UNTIL THE PRINCIPAL OF THE
BONDS IN THE FUND IS EXPECTED TO BE REPAID, WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF MAY 31, 1994
6 MONTHS AGO

Years 7.0 7.3

DURATION SHOWS HOW MUCH A BOND'S PRICE FLUCTUATES WITH CHANGES IN INTEREST
RATES. IF RATES RISE 1%, FOR EXAMPLE, THE SHARE PRICE OF A FUND WITH A
FIVE-YEAR DURATION WILL FALL 5%.
QUALITY DIVERSIFICATION AS OF MAY 31, 1994
(MOODY'S RATINGS)

Aaa 44.4%
Aa, A 55.6%

Row: 1, Col: 1, Value: 55.6
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 0.0
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 44.4
THIS CHART EXCLUDES SHORT-TERM INVESTMENTS. WHERE MOODY'S RATINGS ARE NOT
AVAILABLE, WE HAVE USED S&P RATINGS.
INVESTMENTS MAY 31, 1994 (UNAUDITED)

Showing Percentage of Total Value of Investment in Securities

MUNICIPAL BONDS - 89.7%
PRINCIPAL VALUE (NOTE 1)
AMOUNT
ALASKA - 2.5%
North Slope Borough Series B, 0% 1/1/03,
(MBIA Insured) $ 3,000,000 $ 1,848,750
ARIZONA - 2.7%
Maricopa County Ind. Dev. Auth. Hosp. Facs. Rev. Rfdg.
(Samaritan Health Svcs.) Series B, 6.90% 12/1/99,
(MBIA Insured) 1,000,000 1,085,000
Maricopa County School Dist. #28 Rfdg.
(Kyrene Elementary) Series C, 0% 1/1/07,
(FGIC Insured) 2,000,000 942,500
2,027,500
CALIFORNIA - 12.6%
California Pub. Wks. Board Lease Rev. (California Univ.
Proj.) Series A, 5.50% 6/1/10 1,000,000 898,750
Chino Basin Reg'l. Fing. Auth. Rev. Rfdg. (Muni. Wtr. Dist.
Swr. Sys. Proj.) 7% 8/15/08, (AMBAC Insured) 1,000,000 1,112,500
Fresno Swr. Rev. Series A-1, 6.25% 9/1/14,
(AMBAC Insured) 1,250,000 1,271,875
La Quinta Redev. Agcy. (Tax Allocation Proj. Area #1):
Rfdg. 7.30% 9/1/09, (MBIA Insured) 750,000 849,375
7.30% 9/1/05, (MBIA Insured) 460,000 523,250
Los Angeles County Ctfs. of Prtn. (Disney Parking Proj.):
0% 9/1/02 630,000 387,450
0% 9/1/04 970,000 520,163
0% 9/1/05 1,395,000 695,756
0% 3/1/07 1,000,000 446,250
Sacramento County Fing. Auth. Lease Rev. Rfdg.
Series A, 5.375% 11/1/14, (AMBAC Insured) 1,000,000 905,000
Sacramento Muni. Util. Dist. Elec. Rev.
6.37% 11/15/08, (FGIC Insured) INFL (c) 1,000,000 860,000
West Covina Ctfs. of Prtn. (Queen of the Valley Hosp.)
6.50% 8/15/09 1,000,000 1,000,000
9,470,369
COLORADO - 4.2%
Adams County Single Family Mtg. Rev. Rfdg. Series A-2,
8.70% 6/1/12, (FSA Insured) 1,000,000 1,110,000
Colorado Student Oblig. Auth. Loan Rev. Series L,
6.10% 9/1/02 (e) 1,000,000 1,000,000
Colorado Univ. Hosp. Auth. Hosp. Rev. Series A,
5.80% 11/15/03, (AMBAC Insured) 1,000,000 1,046,250
3,156,250
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE (NOTE 1)
AMOUNT
DISTRICT OF COLUMBIA - 1.3%
District of Columbia Gen. Oblig. Rfdg. Series B,
5.10% 6/1/03, (AMBAC Insured) $ 1,000,000 $ 965,000
FLORIDA - 4.1%
Jacksonville Elec. Auth Rev. Spl. Oblig. (St. John's River)
4th Series, 6.50% 10/1/01 1,000,000 1,081,250
Orlando Orange County Expressway Auth.
5.375% 7/1/11 1,000,000 925,000
Palm Beach County Solid Waste Auth. Rev. Series 1984,
7.75% 7/1/98, (MBIA Insured) 1,000,000 1,113,750
3,120,000
GEORGIA - 3.5%
Metropolitan Atlanta Rapid Trans. Auth. Sales Tax Rev.
Rfdg. Series P, 6% 7/1/04, (AMBAC Insured) 2,000,000 2,112,500
Monroe County Dev. Auth. Poll. Cont. Rev. Rfdg.
(Oglethorpe Pwr. Scherer) Series A,
6.60% 1/1/07 500,000 525,000
2,637,500
ILLINOIS - 2.5%
Chicago Single Family Mtg. Rev. (Cap. Appreciation)
Series A, 0% 12/1/16, (FGIC Insured) (d) 2,700,000 324,000
Illinois Health Facs. Auth. Rev. Rfdg. (Felician Health
Care, Inc.) Series A, 6.85% 1/1/00,
(AMBAC Insured) 1,000,000 1,075,000
Illinois Univ. Rev. (Auxiliary Facs. Sys.) 0% 4/1/07,
(MBIA Insured) 1,135,000 522,100
1,921,100
INDIANA - 1.5%
Indiana Office Bldg. Commission Cap. Complex Rev.
(State Office Bldg. II Fac.) 8.20% 7/1/01,
(Pre-Refunded to 7/1/97 @ 102) (b) 1,000,000 1,113,750
IOWA - 1.4%
Iowa Student Loan Liquidity Corp. Student Loan Rev.
Series A, 6.35% 3/1/01 1,000,000 1,038,750
LOUISIANA - 1.4%
Louisiana Pub. Facs. Auth. Rev. Student Loan Sr. Series A-1,
6.20% 3/1/01 1,000,000 1,040,000
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE (NOTE 1)
AMOUNT
MARYLAND - 1.7%
Northeast Waste Disp. Auth. Resources Recovery Rev. Rfdg.
(Southwest Resources Recovery Fac.) 7% 1/1/01,
(MBIA Insured) $ 500,000 $ 546,250
Prince George's County Rfdg. Consolidated Pub. Impt.
Ltd. Tax 5% 10/1/03 750,000 729,375
1,275,625
MASSACHUSETTS - 10.4%
Massachusetts Gen. Oblig.:
Rfdg. Series A, 5.50% 2/1/11 1,000,000 940,000
(Dedicated Income Tax) Series A, 7.875% 6/1/97 1,000,000 1,070,000
Massachusetts Health & Edl. Facs. Auth. Rev. Rfdg.
(Boston College) Series K, 5.125% 6/1/08 1,000,000 916,250
Massachusetts Ind. Fin. Agcy. Rev. (Cap. Appreciation)
(Massachusetts Biomedical Research) Series A-1:
0% 8/1/00 (d) 1,100,000 775,500
0% 8/1/02 1,600,000 986,000
Massachusetts Wtr. Poll. Abatement Trust Rev.
(Massachusetts Wtr. Resources Auth. Loan Prog.)
Series A, 5.20% 2/1/06 1,200,000 1,150,500
New England Ed. Loan Marketing Corp.
Massachusetts Student Loan Rev. Rfdg.
Series B, 5.40% 6/1/00 1,950,000 1,942,688
7,780,938
MULTIPLE STATES - 2.7%
New England Ed. Loan Marketing Corp. Student Loan
Rev. Rfdg. Sr. Issue A, 6.50% 9/1/02 1,000,000 1,045,000
Washington Metropolitan Area Trans. Auth. Gross Rev.
Rfdg. 6% 7/1/08, (FGIC Insured) 1,000,000 1,008,750
2,053,750
NEW JERSEY - 2.2%
New Jersey Health Care Facs. Fing. Auth. Rev.
(Shore Mem. Hosp.) Series C, 7.30% 7/1/99,
(MBIA Insured) 1,500,000 1,636,875
NEW MEXICO - 3.2%
New Mexico Edl. Assistance Foundation Student Loan Rev.
Sr. Series III-A2, 5.70% 12/1/06 (e) 2,500,000 2,403,125
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE (NOTE 1)
AMOUNT
NEW YORK - 5.0%
New York City Muni. Wtr. Fin. Auth. Wtr. & Swr. Sys.
5.125% 6/15/04 $ 1,000,000 $ 943,750
New York State Local Govt. Assistance Corp.:
Rfdg.:
Series C, 5.50% 4/1/17 745,000 673,294
Series E, 5% 4/1/07 1,345,000 1,237,400
Series A, 0% 4/1/08 1,000,000 431,250
Series D, 5.10% 4/1/08 500,000 458,125
3,743,819
NORTH CAROLINA - 4.0%
North Carolina Eastern Muni. Pwr. Agcy. Pwr. Sys. Rev.
Rfdg. Series B, 7% 1/1/08 2,825,000 3,040,405
OKLAHOMA - 2.7%
Grand River Dam Auth. Rev. Rfdg. 5.75% 6/1/06 2,000,000 2,007,500
PENNSYLVANIA - 2.9%
Pennsylvania Hsg. Fin. Agcy. Rfdg. (Residential Dev.
Section 8) Series A, 7% 7/1/01 1,000,000 1,057,500
Philadelphia Muni. Auth. Rev. (Justice Lease) Series A,
6.80% 11/15/02, (MBIA Insured) 1,000,000 1,087,500
2,145,000
RHODE ISLAND - 1.4%
Rhode Island Student Loan Auth. Student Loan Rev. Rfdg.
Series A, 6.55% 12/1/00 (d) 1,000,000 1,038,750
TEXAS - 9.0%
Austin Util. Sys. Rev. Rfdg. Series A, 6% 11/15/06,
(MBIA Insured) 1,000,000 1,043,750
Harris County Gen. Oblig. Flood Cont. Dist. Rfdg.
0% 10/1/07 3,215,000 1,454,788
North East Independent School Dist. Rfdg. Series D,
0% 2/1/00 4,565,000 3,378,100
Port Arthur Hsg. Fin. Corp. Single Family Mtg. Rev. Rfdg.
8.70% 3/1/12 785,000 845,837
6,722,475
UTAH - 1.9%
Intermountain Pwr. Agcy. Pwr. Supply Rev. Series A,
0% 7/1/06, (MBIA Insured) 2,860,000 1,415,700
VIRGINIA - 1.3%
Portsmouth Pub. Impt. Rfdg. 5% 8/1/02 1,000,000 976,250
MUNICIPAL BONDS - CONTINUED
PRINCIPAL VALUE (NOTE 1)
AMOUNT
WASHINGTON - 3.6%
Washington Pub. Pwr. Supply Sys. Nuclear Proj. #1 Rev.
Rfdg. Series A, 5.10% 7/1/00 $ 1,500,000 $ 1,475,625
Washington Pub. Pwr. Supply Sys. Nuclear Proj. #2 Rev.
7.77% 7/1/12 INFL (c) 1,000,000 780,000
Washington Pub. Pwr. Supply Sys. Nuclear Proj. #3 Rev.
Rfdg. Series C, 5.10% 7/1/07 500,000 451,250
2,706,875
TOTAL MUNICIPAL BONDS
(Cost $68,425,816) 67,286,056
MUNICIPAL NOTES (A) - 10.3%
CONNECTICUT - 2.5%
Connecticut Dev. Auth. Poll. Cont. Rev.
(Light & Pwr. Co. Proj.) Series 1993 A, 2.75%,
LOC Deutsche Bank, VRDN 1,900,000 1,900,000
FLORIDA - 3.6%
Dade County Health Facs. Auth. Hosp. Rev.
(Miami Children's Hosp. Proj.) Series 1990,
3.10%, LOC Barnett Bank, South Florida, VRDN 2,700,000 2,700,000
MARYLAND - 3.0%
Baltimore County Econ. Dev. Rev. Rfdg.
(Blue Circle, Inc. Proj.) Series 1992, 2.95%,
LOC Den Danske Bank Group, VRDN 2,200,000 2,200,000
PENNSYLVANIA - 1.2%
Schuylkill County Ind. Dev. Auth. Resources Recovery Rev.
(Westwood Energy Prop.) Series 1985, 3.10%,
LOC Fuji Bank, VRDN 900,000 900,000
TOTAL MUNICIPAL NOTES
(Cost $7,700,000) 7,700,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $76,125,816) $ 74,986,056
SECURITY TYPE ABBREVIATIONS
VRDN - Variable Rate Demand Notes
LEGEND
1. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
2. Security collateralized by an amount sufficient to pay interest and
principal.
3. Coupon is inversely indexed to a floating interest rate. The price will
be more volatile than the price of a comparable fixed rate security. The
rate shown is the rate at period end.
4. A portion of the security was pledged to cover margin requirements for
futures contracts. At the period end, the value of securities pledged
amounted to $480,375.
5. Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows:
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 89.7% AAA, AA, A 79.9%
Baa 0.0% BBB 0.0%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 0%.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
Electric Revenue 16.9%
General Obligation 16.4
Education 14.6
Health Care 13.7
Others (individually less than 10%) 38.4
TOTAL 100.0%
INCOME TAX INFORMATION
At May 31, 1994, the aggregate cost of investment securities for income tax
purposes was $76,125,816. Net unrealized depreciation aggregated
$1,139,760, of which $1,297,227 related to appreciated investment
securities and $2,436,987 related to depreciated investment securities.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
MAY 31, 1994 (UNAUDITED)

ASSETS

Investment in securities, at value (cost $76,125,816) $ 74,986,056
(Note 1) - See accompanying schedule

Cash 175,877

Receivable for investments sold 3,746,491

Interest receivable 1,056,868

Receivable from investment adviser for expense 4,786
reductions (Note 5)

TOTAL ASSETS 79,970,078

LIABILITIES

Payable for investments purchased $ 5,655,446
Regular delivery

Delayed delivery (Note 2) 3,500,000

Dividends payable 124,683

Accrued management fee 24,244

Payable for daily variation on futures contracts 11,745

Other payables and accrued expenses 57,974

TOTAL LIABILITIES 9,374,092

NET ASSETS $ 70,595,986

Net Assets consist of (Note 1):

Paid in capital $ 72,109,568

Accumulated undistributed net realized gain (loss) on (373,822)
investments

Net unrealized appreciation (depreciation) on investment (1,139,760)
securities

NET ASSETS $ 70,595,986

CALCULATION OF MAXIMUM OFFERING PRICE $10.00
CLASS A
NET ASSET VALUE, and redemption price per share
($56,737,688 (divided by) 5,675,330 shares)

Maximum offering price per share (100/95.25 of $10.00) $10.50

INSTITUTIONAL CLASS $10.00
NET ASSET VALUE, offering price and redemption price per

share ($13,858,298 (divided by) 1,386,188 shares)

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED MAY 31, 1994 (UNAUDITED)

INTEREST INCOME $ 1,752,667

EXPENSES

Management fee (Note 4) $ 137,216

Transfer agent fees (Note 4) 45,655
Class A

Institutional Class 4,824

Distribution fees - Class A (Note 4) 64,828

Accounting fees and expenses (Note 4) 24,785

Non-interested trustees' compensation 198

Custodian fees and expenses 3,845

Registration fees: 20,356
Class A

Institutional Class 14,136

Audit 16,254

Legal 202

Reports to shareholders 132

Miscellaneous 419

Total expenses before reductions 332,850

Expense reductions (Note 5) (51,787) 281,063

NET INTEREST INCOME 1,471,604

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(NOTES 1 AND 3)
Net realized gain (loss) on:

Investment securities (99,027)

Futures contracts 15,122 (83,905)

Change in net unrealized appreciation (depreciation) on:

Investment securities (3,068,460)

Futures contracts 6,432 (3,062,028)

NET GAIN (LOSS) (3,145,933)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ (1,674,329)
OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR ENDED
ENDED MAY 31, NOVEMBER 30,
1994 1993
(UNAUDITED)

INCREASE (DECREASE) IN NET ASSETS

Operations $ 1,471,604 $ 1,841,558
Net interest income

Net realized gain (loss) on investments (83,905) 221,643

Change in net unrealized appreciation (depreciation) (3,062,028) 438,606
on
investments

NET INCREASE (DECREASE) IN NET ASSETS RESULTING (1,674,329) 2,501,807
FROM OPERATIONS

Distributions to shareholders from:
Net interest income

Class A (1,126,659) (1,329,578)

Institutional Class (344,945) (511,980)

Net realized gain

Class A (78,086) (143,697)

Institutional Class (29,109) (2,190,378)

Share transactions - net increase (decrease) (Note 6) 18,972,912 26,369,495

TOTAL INCREASE (DECREASE) IN NET ASSETS 15,719,784 24,695,669

NET ASSETS

Beginning of period 54,876,202 30,180,533

End of period $ 70,595,986 $ 54,876,202

</TABLE>

FINANCIAL HIGHLIGHTS INSTITUTIONAL CLASS
SIX MONTHS YEARS ENDED NOVEMBER 30,
ENDED
MAY 31, 1994

(UNAUDITED) 1993 1992 1991 1990 1989

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE DATA

Net asset value, $ 10.460 $ 11.080 $ 10.800 $ 10.640 $ 10.610 $ 10.520
beginning of period

Income from
Investment
Operations

Net investment .237 .536 .666 .682 .689 .674
income

Net realized and (.440) .260 .280 .160 .030 .090
unrealized gain
(loss) on
investments

Total from investment (.203) .796 .946 .842 .719 .764

operations

Less Distributions

From net investment (.237) (.536) (.666) (.682) (.689) (.674)
income

From net realized (.020) (.880) - - - -
gain

Total distributions (.257) (1.416) (.666) (.682) (.689) (.674)

Net asset value, end of $ 10.000 $ 10.460 $ 11.080 $ 10.800 $ 10.640 $ 10.610
period

TOTAL RETURN (dagger)(double dagger) (1.97)% 8.01% 9.01% 8.15% 7.04% 7.50%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of $ 13,858 $ 15,076 $ 28,428 $ 100,294 $ 111,506 $ 121,418
period (000 omitted)

Ratio of expenses to .65%* .65% .66% .61% .62% .65%
average net assets
(diamond)

Ratio of expenses to .80%* .83% .67% .61% .62% .65%
average net assets
before expense
reductions (diamond)

Ratio of net investment 4.61%* 5.01% 6.05% 6.40% 6.53% 6.45%
income to average
net assets

Portfolio turnover 42%* 46% 36% 20% 32% 31%

</TABLE>

* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
(double dagger) THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN.
(diamond) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
NOTES TO FINANCIAL STATEMENTS
For the period ended May 31, 1994 (Unaudited)

1. SIGNIFICANT ACCOUNTING
POLICIES.
Fidelity Advisor Limited Term Tax-Exempt Fund (the fund) is a fund of
Fidelity Advisor Series VI (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 fund offers both Class A and Institutional Class shares which have
equal rights as to earnings, assets and voting privileges except that each
class bears different distribution and transfer agent expenses and certain
registration fees. Each class has exclusive voting rights with respect to
its distribution plans.
On February 17, 1994, creation of an additional class of Retail shares
(Class B) was approved by the Board of Trustees. Offering of the new class
commences on June 30, 1994. Class B shares are subject to an annual
distribution fee of .75% of average net assets, an annual service fee of
.25% of average net assets, and a contingent deferred sales charge upon
redemption within five years of purchase which decreases from a maximum of
4% to 0%. At the end of six years, Class B shares of a fund automatically
convert to the original class of shares.
The following summarizes the significant accounting policies of the fund:
ALLOCATED EARNINGS AND EXPENSES. Investment income, expenses (other than
expenses incurred under each class's Distribution and Service Plans
Transfer Agent Agreements and certain registration fees) and realized and
unrealized gains or losses on investments are allocated to each class of
shares based upon their relative net assets.
SECURITY VALUATION. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days are valued either at amortized cost or original
cost plus accrued interest, both of which approximate current value.
Securities for which quotations are not readily available through the
pricing service are valued at their fair value as determined in good faith
under consistently applied procedures under the general supervision of the
Board of Trustees.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net investment income. Distributions from realized gains, if
any, are recorded on the ex-dividend date.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
net operating losses and losses deferred due to excise tax regulations. 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.
Undistributed net investment income may include temporary book and tax
basis differences which will reverse in a subsequent period. Any taxable
income or gain remaining at fiscal year end is distributed in the following
year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
CHANGE IN ACCOUNTING FOR DISTRIBUTIONS TO SHAREHOLDERS. Effective December
1, 1993, the fund adopted Statement of Position 93-2: Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain,
and Return of Capital Distributions by Investment Companies. As a result,
the fund changed the classification of distributions to shareholders to
better disclose the differences between financial statement amounts and
distributions determined in accordance with income tax regulations.
Accordingly, amounts as of November 30, 1993 have been reclassified to
reflect an increase in paid in capital of $2,479,479 and decrease in
accumulated net realized gain on investments of $2,479,479.
2. OPERATING POLICIES.
DELAYED DELIVERY TRANSACTIONS. The fund may purchase or sell securities on
a when-issued or forward commitment basis. Payment and delivery may take
place a month or more after the date of the transaction. The price of the
underlying securities and the date when the securities will be delivered
and paid for are fixed at the time the transaction is negotiated. The fund
identifies securities as segregated in its custodial records with a value
at least equal to the amount of the purchase commitment.
FUTURES CONTRACTS AND OPTIONS. The fund may invest in futures contracts and
write options. These investments involve to varying degrees, elements of
market risk and risks in excess of the amount recognized in the Statement
of Assets and Liabilities. The face or contract amounts reflect the extent
of the involvement the fund has in the particular classes of instruments.
Risks may be caused by an imperfect correlation between movements in the
price of the instruments and the price of the underlying securities and
interest rates. Risks also may arise if there is an illiquid secondary
2. OPERATING POLICIES - CONTINUED
FUTURES CONTRACTS AND OPTIONS - CONTINUED
market for the instruments, or due to the inability of counterparties to
perform.
Futures contracts are valued at the settlement price established each day
by the board of trade or exchange on which they are traded. Options traded
on an exchange are valued using the last sale price or, in the absence of a
sale, the last offering price. Options traded over-the-counter are valued
using dealer-supplied valuations.
3. PURCHASES AND SALES OF
INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $35,226,153 and $12,312,546, respectively.
The gross market value of futures contracts opened and closed amounted to
$43,065,856 and $45,168,992, respectively.
4. FEES AND OTHER
TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, Fidelity Management &
Research Company (FMR) receives a monthly fee that is calculated on the
basis of a group fee rate plus a fixed individual fund fee rate applied to
the average net assets of the fund. The group fee rate is the weighted
average of a series of rates ranging from .15% to .37% and is based on the
monthly average net assets of all the mutual funds advised by FMR. The
annual individual fund fee rate is .25%. For the period, the management fee
was equivalent to an annualized rate of .41% of average net assets.
The Board of Trustees approved a new group fee rate schedule with rates
ranging from .1325% to .3700%. Effective November 1, 1993, FMR has
voluntarily agreed to implement this new group fee rate schedule as it
results in the same or a lower management fee.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plan (the Plan), and in accordance with Rule 12b-1 of the 1940 Act, Class A
pays Fidelity Distributors Corporation (FDC), an affiliate of FMR, a
distribution and service fee that is based on an annual rate of .25% of its
average net assets. For the period, Class A paid FDC $64,828 of which was
paid to securities dealers, banks and other financial institutions for
selling shares of Class A and providing shareholder support services.
In addition, FMR or FDC may use its resources to pay administrative and
promotional expenses related to the sale of the fund's shares. Subject to
the approval of the Board of Trustees, the Plan also authorizes payments to
third parties that assist in the sale of the fund's shares or render
shareholder support services. FMR or FDC has informed the fund that
payments made to third parties under the Plan amounted to $3,151 for the
period.
SALES LOAD. FDC received sales charges for selling shares of Class A. The
sales charge rates ranged from 2.00% to 4.75% based on purchase amounts of
less than $1,000,000. Purchase amounts of $1,000,000 or more are not
charged a sales load. For the period,
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SALES LOAD - CONTINUED
FDC received $406,353 of which $346,092 was paid to securities dealers,
banks and other financial institutions.
TRANSFER AGENT AND ACCOUNTING FEES. United Missouri Bank, N.A. (the Bank)
is the custodian and transfer and shareholder servicing agent for the fund.
The Bank has entered into a sub-contract with Fidelity Investments
Institutional Operations Company (FIIOC), an affiliate of FMR, and State
Street Bank and Trust Company (SSB) to perform the transfer, dividend
disbursing and shareholder servicing agent functions for Class A and
Institutional Class, respectively. Under revised fee schedules which became
effective January 1, 1993, FIIOC and SSB receive fees based on the type,
size, number of accounts and the number of transactions made by
shareholders. FIIOC, on behalf of SSB, collects from the fund and pays SSB
for its services. FIIOC pays for typesetting, printing and mailing of all
shareholder reports, except proxy statements.
The Bank also has a sub-contract with Fidelity Service Co. (FSC), an
affiliate of FMR, under which 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. For the period, FSC received accounting fees
amounting to $23,135.
5. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the funds' for total operating expenses
(excluding interest, taxes, brokerage commissions and extraordinary
expenses) above an annual rate of .90% and .65% of average net assets for
Class A and Institutional Class, respectively. For the period, the
reimbursement reduced expenses by $40,311 and $11,476 for Class A and
Institutional Class, respectively.
6. SHARE TRANSACTIONS.
Share transactions for both classes were as follows:
SHARES DOLLARS
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
MAY 31, NOVEMBER 30, MAY 31, NOVEMBER 30,
1994 1993 1994 1993
CLASS A
Shares sold 3,962,622 3,977,874 $ 40,774,854 $ 41,639,361
Reinvestment of distributions 82,259 52,406 843,056 545,193
Shares redeemed (2,175,905) (382,039) (22,096,043) (4,040,833)
Net increase (decrease) 1,868,976 3,648,241 $ 19,521,867 $ 38,143,721
INSTITUTIONAL CLASS
Shares sold 287,049 1,304,786 $ 2,987,117 $ 13,459,923
Reinvestment of distributions 3,990 46,412 38,307 474,315
Shares redeemed (346,551) (2,475,469) (3,574,379) (25,708,464)
Net increase (decrease) (55,512) (1,124,271) $ (548,955) $ (11,774,226)

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
John F. Haley, Jr., Vice President
Gary L. French, Treasurer
John H. Costello, Assistant Treasurer
Arthur S. Loring, Secretary
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox
Phyllis Burke Davis
Richard J. Flynn
Edward C. Johnson 3d
E. Bradley Jones
Donald J. Kirk
Peter S. Lynch
Edward H. Malone
Marvin L. Mann
Gerald C. McDonough
Thomas R. Williams
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
United Missouri Bank, N.A.
Kansas City, MO
CUSTODIAN
United Missouri Bank, N.A.
Kansas City, MO
EQUITY FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Portfolio Growth
Fidelity Advisor Growth Opportunities Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Strategic Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Portfolio Income
Fidelity Advisor Income & Growth Fund
FIXED-INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Limited Term Bond Fund
Fidelity Advisor Short Fixed-Income Fund
TAX-EXEMPT FUNDS
Fidelity Advisor High Income Municipal Fund
Fidelity Advisor Limited Term Tax-Exempt Fund
Fidelity Advisor Short-Intermediate Tax-Exempt Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)

(2_FIDELITY_LOGOS)FIDELITY ADVISOR
(registered trademark)

LIMITED TERM TAX-EXEMPT FUND - CLASS A
SEMIANNUAL REPORT
MAY 31, 1994
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on bond market
strategies.

PERFORMANCE 4 How the fund has done over time.

FUND TALK 8 The manager's review of fund
performance, strategy and outlook.

INVESTMENT CHANGES 11 A summary of major shifts in the
fund's investments over the past six
months.

INVESTMENTS 12 A complete list of the fund's
investments with their market
values.

FINANCIAL STATEMENTS 18 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.

NOTES 23 Notes to the financial statements.

There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each figure
includes changes in a fund's share price, reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells bonds
that have grown in value). You can also look at the fund's income. If
Fidelity had not reimbursed certain fund expenses during the period shown,
the total returns and yield dividends would have been lower.
CUMULATIVE TOTAL RETURNS

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PERIODS ENDED MAY 31, 1994 PAST 6 PAST 1 PAST 5 LIFE OF
MONTHS YEAR YEARS FUND

Advisor Limited Term Tax-Exempt - Class A -2.10% 1.21% 37.94% 85.35%

Advisor Limited Term Tax-Exempt - Class A
(including 4.75% sales charge) -6.75% -3.60% 31.39% 76.55%

Lehman Brothers Municipal Bond Index -1.83% 2.47% 48.85% n/a

Average Intermediate Municipal Bond Fund -1.10% 2.94% 42.63% n/a

Consumer Price Index 1.17% 2.29% 19.14% 36.20%

</TABLE>

Advisor Limited Term Tax-Exempt - Class A 1.21% 6.64% 7.35%

Advisor Limited Term Tax-Exempt - Class A
(including 4.75% sales charge) -3.60% 5.61% 6.75%

Lehman Brothers Municipal Bond Index 2.47% 8.28% n/a

Average Intermediate Municipal Bond Fund 2.94% 7.36% n/a

Consumer Price Index 2.29% 3.57% 3.63%

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
FA Ltd Term Tax-Exempt Retail (289)LB Municipal Bond Index
09/30/85 9525.00 10000.00
10/31/85 9768.56 10342.70
11/30/85 9955.40 10713.69
12/31/85 9980.92 10807.87
01/31/86 10339.66 11444.45
02/28/86 10513.59 11898.34
03/31/86 10579.22 11902.14
04/30/86 10625.58 11911.19
05/31/86 10531.04 11717.28
06/30/86 10637.13 11829.06
07/31/86 10664.19 11900.86
08/31/86 11016.18 12433.66
09/30/86 11062.59 12464.87
10/31/86 11292.67 12680.14
11/30/86 11387.94 12931.33
12/31/86 11349.71 12895.64
01/31/87 11552.33 13283.93
02/28/87 11682.08 13349.29
03/31/87 11621.03 13207.78
04/30/87 11146.26 12545.02
05/31/87 11139.32 12482.79
06/30/87 11347.33 12849.29
07/31/87 11480.43 12980.35
08/31/87 11505.12 13009.56
09/30/87 11138.00 12529.90
10/31/87 11241.38 12574.25
11/30/87 11498.92 12902.56
12/31/87 11613.73 13089.78
01/31/88 12030.20 13556.04
02/29/88 12079.27 13699.33
03/31/88 11902.66 13539.73
04/30/88 11962.49 13642.63
05/31/88 12000.34 13603.20
06/30/88 12084.69 13802.22
07/31/88 12147.57 13892.21
08/31/88 12153.38 13904.43
09/30/88 12286.74 14156.10
10/31/88 12432.90 14405.96
11/30/88 12392.45 14274.00
12/31/88 12470.65 14420.02
01/31/89 12596.85 14718.23
02/28/89 12521.62 14550.30
03/31/89 12481.91 14515.52
04/30/89 12658.34 14860.12
05/31/89 12847.36 15168.76
06/30/89 12988.37 15374.75
07/31/89 13117.99 15584.01
08/31/89 13075.49 15431.44
09/30/89 13072.90 15385.14
10/31/89 13177.74 15572.84
11/30/89 13321.92 15845.37
12/31/89 13441.99 15975.30
01/31/90 13398.15 15900.22
02/28/90 13517.12 16041.73
03/31/90 13540.15 16046.54
04/30/90 13400.91 15931.00
05/31/90 13645.24 16278.30
06/30/90 13758.21 16421.55
07/31/90 13924.24 16662.95
08/31/90 13843.28 16421.33
09/30/90 13880.36 16431.19
10/31/90 14035.58 16728.59
11/30/90 14259.53 17064.84
12/31/90 14298.01 17139.92
01/31/91 14457.67 17369.60
02/28/91 14589.30 17520.71
03/31/91 14599.10 17527.72
04/30/91 14731.45 17760.84
05/31/91 14849.46 17918.91
06/30/91 14858.49 17900.99
07/31/91 15007.31 18119.38
08/31/91 15127.23 18358.56
09/30/91 15219.94 18597.22
10/31/91 15383.38 18764.59
11/30/91 15422.15 18817.14
12/31/91 15676.99 19221.70
01/31/92 15786.51 19265.91
02/29/92 15804.62 19271.69
03/31/92 15744.19 19279.40
04/30/92 15854.31 19450.99
05/31/92 16028.20 19680.51
06/30/92 16238.55 20011.14
07/31/92 16588.27 20611.48
08/31/92 16465.62 20409.49
09/30/92 16621.27 20542.15
10/31/92 16503.01 20340.83
11/30/92 16804.56 20704.93
12/31/92 16824.86 20916.13
01/31/93 17016.17 21158.75
02/28/93 17488.62 21924.70
03/31/93 17315.14 21692.30
04/30/93 17436.92 21911.39
05/31/93 17510.32 22034.09
06/30/93 17694.87 22402.06
07/31/93 17714.97 22431.19
08/31/93 18040.91 22897.75
09/30/93 18227.54 23158.79
10/31/93 18244.65 23202.79
11/30/93 18102.42 22998.61
12/31/93 18411.73 23483.88
01/31/94 18582.55 23751.59
02/28/94 18118.55 23136.43
03/31/94 17410.65 22194.77
04/30/94 17564.75 22383.43
05/31/94 17721.97 22578.16
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Fidelity
Advisor Limited Term Tax-Exempt - Class A on September 30, 1985, shortly
after the fund started and paid the maximum 4.75% sales charge. As the
chart shows, by May 31, 1994, the value of your investment with dividends
reinvested would have grown to $17,722 - a 77.22% increase on your initial
investment. For comparison, look at how the Lehman Brothers Municipal Bond
Index did over the same period. With dividends reinvested, the same $10,000
would have grown to $22,578 - a 125.78% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, move in the
opposite direction of interest
rates. In turn, the share price,
return, and yield of a fund
that invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
On September 10, 1992, the fund began offering Class A shares. All
performance information for Class A prior to September 10, 1992 does not
reflect Class A's 12b-1 fee and revised transfer agent fee arrangements,
which if included, would lower Class A's performance.
For the period ending May 31, 1994, Fidelity Advisor Limited Term
Tax-Exempt - Institutional Class (Institutional Class) shares' cumulative
total returns were -1.97%, 1.59%, 38.55%, and 86.17%, for six months, one
year, five years, and life of fund, respectively. Institutional Class
shares' average annual total returns were 1.59%, 6.74%, and 7.40% for one
year, five years, and life of fund, respectively.
Cumulative total returns for the Institutional Class shares' for the one
year period ended November 30, 1993, 1992, 1991, 1990 and 1989 were 8.01%,
9.01%, 8.15%, 7.04%, and 7.50%, respectively.
TOTAL RETURN COMPONENTS

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SIX
MONTHS
ENDED YEARS ENDED NOVEMBER 30,
MAY 31,

1994 1993 1992 1991 1990 1989

Dividend return 2.12% 5.13% 6.37% 6.65% 6.76% 6.64%

Capital appreciation -4.22% 2.59% 2.59% 1.50% 0.28% 0.86%
return

Total return -2.10% 7.72% 8.96% 8.15% 7.04% 7.50%

</TABLE>

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PERIODS ENDED MAY 31, 1994 PAST PAST 6 PAST 1
MONTH MONTHS YEAR

Dividends per share 3.91(cents) 22.37(cents) 46.23(cents)

Annualized dividend rate 4.64% 4.37% 4.45%

30-day annualized yield 4.40% n/a n/a

30-day annualized tax-equivalent yield 6.38% n/a n/a

</TABLE>

DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $9.93 over
the past month, $10.27 over the past six months and $10.38 over the past
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all funds based on the
yields of the bonds in the fund, averaged over the past 30 days. This
figure shows you the yield characteristics of the fund's investments at the
end of the period. It also helps you compare funds from different companies
on an equal basis. The tax-equivalent yield shows what you would have to
earn on a taxable investment to equal the fund's tax-free yield, if you're
in the 31% federal tax bracket. If Fidelity had not reimbursed certain
fund expenses during the period shown, the yield and tax-equivalent yield
would have been 4.24% and 6.14%, respectively. Institutional Class shares'
30-day yield annualized yield was 4.87% and the 30-day annualized
tax-equivalent yield was 7.06%. If Fidelity had not reimbursed certain fund
expenses during the period shown, Institutional Class shares' yield and
tax-equivalent yield would have been 4.72% and 6.84%, respectively.
FUND TALK: THE MANAGER'S OVERVIEW

An interview with John Haley,
Portfolio Manager of Fidelity Advisor Limited Term Tax-Exempt Fund
Q. JACK, HOW HAS THE FUND PERFORMED?
A. It was a rough period for both the municipal bond market and the fund.
For the six months ended May 31, 1994, Fidelity Advisor Limited Term
Tax-Exempt Fund - Class A had a total return of -2.10%. That lagged the
average intermediate municipal fund, which returned -1.10% for the same
period, according to Lipper Analytical Services. For the 12 months ended
May 31, 1994, the fund returned 1.21%, compared to the average return of
2.94%, again according to Lipper.
Q. WHAT CAUSED THE MUNICIPAL BOND MARKET TO FALL OVER THE PAST SIX MONTHS?
A. Interest rates, which typically move in the opposite direction of
municipal bond prices, generally rose during the past six months. By
mid-November, fears of inflation caused interest rates to rise slightly,
after having fallen during most of 1993. Until the end of January, rates
moved within a narrow range. During this period, the Federal Reserve Board
seemed content to keep the federal funds rate - the rate banks charge each
other for overnight loans - at 3.00%, where it had been since September
1992. On February 4, the Fed reversed that policy, raising the fed funds
rate to 3.25%. And through May, the Fed moved three more times, raising fed
funds to 4.25%. The Fed rate hikes were a preemptive strike against
inflation. The economy appeared to be heating up and the Fed seemed
determined to keep inflation in check. However, the moves still worried
bond investors, who dislike any mention of inflation because it erodes the
value of their bonds' interest income, which is paid at a fixed rate. As a
result, bond prices fell from February through early May. In recent weeks,
though, the market has started to stabilize.
Q. WHY DID THE FUND LAG THE AVERAGE FUND?
A. Primarily because it had a longer duration, which is a measure of the
fund's sensitivity to interest rate changes. The longer the duration, the
more sensitive the fund. Going into 1994, I thought the economic growth
would be moderate and inflation would stay low, eliminating any real need
on the part of the Fed to raise rates. In addition, I believed that supply
and demand factors would work in municipal bonds' favor. The rate of
municipal bonds issued in 1994 was expected to be half of what it was in
1993, and higher federal income taxes were expected to boost demand.
However, the expected positive effects of lower supply and higher demand
were stalled when the Fed moved on February 4. In the fourth quarter of
last year, having a longer duration helped the fund's performance. But once
rates started to rise, having a longer duration contributed most to the
fund's decline. To help hedge against some of that decline, I used futures
and options.
Q. THERE'S BEEN A LOT OF TALK LATELY ABOUT DERIVATIVES. AREN'T FUTURES AND
OPTIONS CONTRACTS TWO OF THE FINANCIAL ARRANGEMENTS KNOWN AS DERIVATIVES,
AND DO YOU USE OTHERS?
A. Yes, futures and options are two types of financial derivatives commonly
used and we've used both for several years. And as I mentioned earlier, we
used these contracts to help protect the fund from the market decline. As
bond prices fell, the futures and options contracts rose in value. Next to
futures and options, the most commonly used derivatives in the municipal
bond market are inverse floaters. These securities typically are created by
splitting a municipal bond into two parts: a tax-free money market
instrument yielding the prevailing short-term rate and a longer-term
security whose yield moves in the opposite direction when money market
rates change. The latter piece is called an inverse floater because its
coupon rises as short-term rates fall and vice versa. Inverse floaters,
which represented less than 3% of the fund's total assets at the end of
May, provide higher levels of tax-free income while allowing me to increase
the fund's sensitivity to interest rate changes. In contrast, I used
futures recently to reduce volatility. By using derivatives, I can achieve
a higher level of tax-free income, approximately twice the yield of a
regular fixed-rate bond, and increased flexibility in managing the fund's
duration.
Q. HOW HAVE YOU ALLOCATED THE FUND IN TERMS OF SECTORS AND STATES?
A. Electric revenue and general obligation bonds make up the fund's two
largest sectors. Education bonds, which are primarily student loan bonds,
are the third largest sector concentration. In a generally flat interest
rate environment, which I'm expecting for the rest of the year, student
loan bonds can provide the fund with extra income. In terms of state
concentrations, California is still at the top of the list. While these
bonds didn't do as well as other states during the market's decline, I
think it's important to have a core position in the fund to take advantage
of future improvements in the state's economic and fiscal situation.
Q. WHAT'S YOUR OUTLOOK OVER THE NEXT SIX MONTHS OR SO?
A. I think the worst may be over for municipal bonds, although there will
probably be some short-term volatility in the market. Lower interest rates
helped stimulate economic growth in 1993. In my opinion, higher interest
rates will keep the rate of economic growth more moderate in 1994. That
should keep interest rates relatively stable over the near term. From a
supply and demand standpoint, there are some positives. The volume of
municipal bonds issued from January through the end of May is down 38% from
a year ago. In addition, there were some bonds that were called, or
redeemed early, by their issuers in January and there will be even more
bonds called this July. Eventually, lower supply and even steady demand
could help boost municipal bond prices this year.
FUND FACTS
GOAL: to provide a high level
of current income exempt
from federal income taxes
START DATE: September 19,
1985
SIZE: as of May 31, 1994,
more than $70 million
MANAGER: Jack Haley, since
inception; joined Fidelity in
1981
(checkmark)
JACK HALEY'S INVESTMENT
PHILOSOPHY:
"The goal of the fund is to
generate between 80% and
90% of the yield available
from long-term municipal
bonds, with approximately
60% of the volatility of a
long-term bond fund. In
structuring the fund, I
evaluate a number of factors,
including our outlook for the
economy and interest rates.
Next, I focus on the yield
curve, spread relationships,
and individual security
selection. I start by analyzing
the slope of the yield curve, or
the difference between the
income that bonds of varying
maturities pay. If the yield
curve is flat, there usually isn't
much reward for buying
longer-term bonds. On the
other hand, if the yield curve
is steep, longer bonds pay
more in yield, and that yield
differential may be worth the
added risk. Next, I analyze the
spread relationships - or the
differences in yield and prices
- - among securities from
various states, sectors and
coupons, looking to add bonds
that provide relative value.
Ultimately, individual security
selection is driven by Fidelity's
careful research of each bond
we own."
INVESTMENT CHANGES

TOP FIVE STATES AS OF MAY 31, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

California 12.6 14.2

Massachusetts 10.4 9.3

Texas 9.0 10.2

Florida 7.7 7.7

New York 5.0 3.2

TOP FIVE SECTORS AS OF MAY 31, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

Electric Revenue 16.9 10.3

General Obligation 16.4 15.5

Education 14.6 16.3

Health Care 13.7 20.4

Lease Revenue 6.6 10.6

AVERAGE YEARS TO MATURITY AS OF MAY 31, 1994
6 MONTHS AGO

Years 9.6 9.8

AVERAGE YEARS TO MATURITY SHOWS THE AVERAGE TIME UNTIL THE PRINCIPAL OF THE
BONDS IN THE FUND IS EXPECTED TO BE REPAID, WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF MAY 31, 1994
6 MONTHS AGO

Years 7.0 7.3

Aaa 44.4%
Aa, A 55.6%

Showing Percentage of Total Value of Investment in Securities

STATEMENT OF ASSETS AND LIABILITIES

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MAY 31, 1994 (UNAUDITED)

ASSETS

Investment in securities, at value (cost $76,125,816) $ 74,986,056
(Note 1) - See accompanying schedule

Cash 175,877

Receivable for investments sold 3,746,491

Interest receivable 1,056,868

Receivable from investment adviser for expense 4,786
reductions (Note 5)

TOTAL ASSETS 79,970,078

LIABILITIES

Payable for investments purchased $ 5,655,446
Regular delivery

Delayed delivery (Note 2) 3,500,000

Dividends payable 124,683

Accrued management fee 24,244

Payable for daily variation on futures contracts 11,745

Other payables and accrued expenses 57,974

TOTAL LIABILITIES 9,374,092

NET ASSETS $ 70,595,986

Net Assets consist of (Note 1):

Paid in capital $ 72,109,568

Accumulated undistributed net realized gain (loss) on (373,822)
investments

Net unrealized appreciation (depreciation) on investment (1,139,760)
securities

NET ASSETS $ 70,595,986

CALCULATION OF MAXIMUM OFFERING PRICE $10.00
CLASS A
NET ASSET VALUE, and redemption price per share
($56,737,688 (divided by) 5,675,330 shares)

Maximum offering price per share (100/95.25 of $10.00) $10.50

INSTITUTIONAL CLASS $10.00
NET ASSET VALUE, offering price and redemption price per

share ($13,858,298 (divided by) 1,386,188 shares)

</TABLE>

STATEMENT OF OPERATIONS

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SIX MONTHS ENDED MAY 31, 1994 (UNAUDITED)

INTEREST INCOME $ 1,752,667

EXPENSES

Management fee (Note 4) $ 137,216

Transfer agent fees (Note 4) 45,655
Class A

Institutional Class 4,824

Distribution fees - Class A (Note 4) 64,828

Accounting fees and expenses (Note 4) 24,785

Non-interested trustees' compensation 198

Custodian fees and expenses 3,845

Registration fees: 20,356
Class A

Institutional Class 14,136

Audit 16,254

Legal 202

Reports to shareholders 132

Miscellaneous 419

Total expenses before reductions 332,850

Expense reductions (Note 5) (51,787) 281,063

NET INTEREST INCOME 1,471,604

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(NOTES 1 AND 3)
Net realized gain (loss) on:

Investment securities (99,027)

Futures contracts 15,122 (83,905)

Change in net unrealized appreciation (depreciation) on:

Investment securities (3,068,460)

Futures contracts 6,432 (3,062,028)

NET GAIN (LOSS) (3,145,933)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ (1,674,329)
OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

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SIX MONTHS YEAR ENDED
ENDED MAY 31, NOVEMBER 30,
1994 1993
(UNAUDITED)

INCREASE (DECREASE) IN NET ASSETS

Operations $ 1,471,604 $ 1,841,558
Net interest income

Net realized gain (loss) on investments (83,905) 221,643

Change in net unrealized appreciation (depreciation) (3,062,028) 438,606
on
investments

NET INCREASE (DECREASE) IN NET ASSETS RESULTING (1,674,329) 2,501,807
FROM OPERATIONS

Distributions to shareholders from:
Net interest income

Class A (1,126,659) (1,329,578)

Institutional Class (344,945) (511,980)

Net realized gain

Class A (78,086) (143,697)

Institutional Class (29,109) (2,190,378)

Share transactions - net increase (decrease) (Note 6) 18,972,912 26,369,495

TOTAL INCREASE (DECREASE) IN NET ASSETS 15,719,784 24,695,669

NET ASSETS

Beginning of period 54,876,202 30,180,533

End of period $ 70,595,986 $ 54,876,202

</TABLE>

FINANCIAL HIGHLIGHTS CLASS A

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SIX MONTHS YEAR ENDED PERIOD
ENDED MAY 31, NOVEMBER ENDED
1994 30, NOVEMBER
30,

(UNAUDITED) 1993 1992(dagger)

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 10.460 $ 11.080 $ 11.010

Income from Investment Operations

Net investment income .224 .508 .131

Net realized and unrealized gain (loss) on (.440) .260 .070
investments

Total from investment operations (.216) .768 .201

Less Distributions

From net investment income (.224) (.508) (.131)

From net realized gain (.020) (.880) -

Total distributions (.244) (1.388) (.131)

Net asset value, end of period $ 10.000 $ 10.460 $ 11.080

TOTAL RETURN (dagger)(double dagger) (2.10)% 7.72% 1.37%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 56,738 $ 39,800 $ 1,752

Ratio of expenses to average net assets (diamond) .90%* .90% 1.04%*

Ratio of expenses to average net assets before 1.06%* 1.36% 1.06%*
expense reductions (diamond)

Ratio of net investment income to average net 4.36%* 4.76% 5.65%*
assets

Portfolio turnover 42%* 46% 36%

</TABLE>

* ANNUALIZED
(dagger) TOTAL RETURNS DO NOT INCLUDE ONE TIME SALES CHARGE AND FOR PERIODS
OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
(double dagger) THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN.
(diamond) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
(dagger) FOR THE PERIOD SEPTEMBER 10, 1992 (COMMENCEMENT OF SALES OF CLASS
A SHARES) TO NOVEMBER 30, 1992.
NOTES TO FINANCIAL STATEMENTS
For the period ended May 31, 1994 (Unaudited)