SUPPLEMENT TO THE FIDELITY ADVISOR FUNDS
CLASS A, CLASS T, AND CLASS B
FEBRUARY 28,1997 PROSPECTUS
The following information replaces similar information found on the cover
page.
High Yield and Strategic Income may each invest without limitation in
lower-quality debt securities, sometimes called "junk bonds." Investors
should consider that these securities carry greater risks, such as the risk
of default, than other debt securities. Refer to "Investment Principles and
Risks" on page 40 for further information.
The following information replaces similar information found in "Who May
Want to Invest" on page 3.
High Income Municipal, Municipal Bond, Intermediate Municipal Income, and
Short-Intermediate Municipal Income are designed for investors in higher
tax brackets who seek high current income that is free from federal income
tax. Municipal Bond, Intermediate Municipal Income, and Short-Intermediate
Municipal Income also invest consistent with consideration of capital
preservation. High Income Municipal may invest in lower-quality municipal
securities which invoke greater risks than the investment-grade securities.
The following information replaces similar information found in "Who May
Want to Invest" beginning on page 3.
Each fund is composed of multiple classes of shares. All classes of a fund
have a common investment objective and investment portfolio. Class A and
Class T shares have a front-end sales charge and pay a distribution fee.
Class A and Class T shares may be subject to a contingent deferred sales
charge (CDSC). Class B shares do not have a front-end sales charge, but do
have a CDSC, and pay a distribution fee and a shareholder service fee.
Institutional Class shares have no sales charge and do not pay a
distribution fee or a shareholder service fee, but are available only to
certain types of investors. See "Sales Charge Reductions and Waivers," page
64, for Institutional Class eligibility information. You may obtain more
information about Institutional Class shares, which are not offered through
this prospectus, by calling 1-800-843-3001 or from your investment
professional.
The performance of one class of shares of a fund may be different from the
performance of another class of shares of the same fund because of
different sales charges and class expenses. Contact your investment
professional to discuss which class is appropriate for you.
In determining which class of shares is appropriate for you, you should
consider, among other factors, the amount you plan to invest, the length of
time you intend to hold your shares, your eligibility for a sales charge
waiver or reduction, and the package of services provided to you by your
investment professional and the overall costs of those services. In
general, Class A shares have higher costs than Class T shares over a short
holding period because Class A shares have a higher front-end sales charge,
and Class A shares have lower costs than Class T shares over a longer
holding period because Class A shares have lower 12b-1 fees. If you are
planning to invest a significant amount either at one time or through a
regular investment program, you should consider the reduced front-end sales
charges available on Class A and Class T shares. See "Transaction Details,"
page 60, and "Sales Charge Reductions and Waivers," page 64, for sales
charge reduction information. If you are eligible for a front-end sales
charge waiver on a purchase of both Class A and Class T shares, Class A
shares generally will have lower costs than Class T shares because Class A
shares have lower 12b-1 fees. However, you should evaluate the overall
costs of purchasing Class A shares or Class T shares in the context of the
package of services provided to you by your investment professional. See
"Sales Charge Reductions and Waivers," page 64, for sales charge waiver
information. If you prefer not to pay a front-end sales charge, you should
consider Class B shares. While Class B shares are subject to higher ongoing
costs than Class A or Class T shares, because of their higher 12b-1 fees,
Class B shares are sold with a CDSC instead of a front-end sales charge so
your entire purchase amount is immediately invested. Please note that
purchase amounts of more than $250,000 will not be accepted for Class B
shares, and that Class A or Class T shares may have lower costs for
investments that qualify for a front-end sales charge reduction or waiver.
If you sell your Class B shares of the Intermediate-Term Bond Funds within
three years or your Class B shares of the Bond Funds and the Equity Funds
within six years, you will normally pay a CDSC that varies depending on how
long you have held your shares. See "Transaction Details," page 60, for
CDSC schedules and related information.
The following information replaces similar information found in "Expenses"
on page 4.
Class Class Class
A T B
Maximum sales charge (as a % of 5.75% 3.50 None
offering price) on purchases of: %
TechnoQuant Growth, Mid Cap,
Equity Growth, Growth
Opportunities, Strategic
Opportunities, Large Cap, Growth &
Income, Equity Income, and
Balanced (the Equity Funds)
Maximum sales charge (as a % of 4.75% 3.50 None
offering price) on purchases of: %
High Yield, Strategic Income,
Mortgage Securities, Government
Investment, High Income Municipal,
Municipal Bond, California
Municipal Income, and New York
Municipal Income (the Bond Funds)
Maximum sales charge (as a % of 3.75% 2.75 None
offering price) on purchases of: %
Intermediate Bond and
Intermediate Municipal Income (the
Intermediate-Term Bond Funds)
Maximum sales charge (as a % of 1.50% 1.50 None
offering price) on purchases of: %
Short-Fixed Income and
Short-Intermediate
Municipal Income (the Short-Term
Bond Funds)
Maximum CDSC for all Equity and Non Non 5.00%[
Bond Funds (as a % of the lesser e[A] e[A] B]
of original purchase price or
redemption proceeds)
Maximum CDSC for the Non Non 3.00%[
Intermediate-Term Bond e[A] e[A] C]
Funds (as a % of the lesser of the
original purchase price or
redemption proceeds)
Maximum CDSC for the Short-Term Non Non *
Bond Funds (as a % of the lesser e[A] e[A]
of the original purchase price or
redemption proceeds)
Maximum sales charge on Non Non None
reinvested distributions e e
Redemption fee Non Non None
e e
Exchange fee Non Non None
e e
Annual account maintenance fee $12.0 $12. $12.0
(for accounts under $2,500) 0 00 0
* FUNDS DO NOT OFFER CLASS B SHARES.
[A] A CONTINGENT DEFERRED SALES CHARGE CHARGE OF 0.25% IS ASSESSED ON
CERTAIN REDEMPTIONS OF CLASS A AND CLASS T SHARES ON WHICH A FINDER'S
FEE WAS PAID. SEE "TRANSACTION DETAILS", PAGE 60.
[B] DECLINES OVER 6 YEARS FROM 5.00% TO 0%.
[C] DECLINES OVER 3 YEARS FROM 3.00% TO 0%.
The following information replaces similar information found in "Expenses"
on page 5.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
EQUITY FUNDS
Operating Expenses Class Class T Class B
A
EQUITY GROWTH Management fee 0.61% 0.61% 0.61%
12b-1 fee (including 0.25% Shareholder 0.25% 0.50% 1.00%
Service Fee for Class B shares)
Other expenses 0.33%[A 0.25% 0.34%[A
] ]
Total operating expenses 1.19% 1.36% 1.95%
GROWTH OPPORTUNITIES Management fee 0.61% 0.61% 0.61%
12b-1 fee (including 0.25% Shareholder 0.25% 0.50% 1.00%
Service Fee for Class B shares)
Other expenses 0.28%[A 0.23% 0.32%[A
] ]
Total operating expenses 1.14% 1.34% 1.93%
</TABLE>
The following footnotes replace similar footnotes found in "Expenses" on
page 5.
[A] BASED ON ESTIMATED EXPENSES FOR FIRST YEAR.
[C] EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
0.20% TO 0.15%. IF THIS AGREEMENT WAS NOT IN EFFECT, THE MANAGEMENT FEE
WOULD BE 0.50% AND TOTAL OPERATING EXPENSES WOULD BE 1.15%, 1.26% , AND
1.94% FOR CLASS A, CLASS T, AND CLASS B, RESPECTIVELY.
The following information replaces similar information found in "Expenses"
on page 7.
A portion of the brokerage commissions that certain of the funds pay is
used to reduce fund expenses. In addition, certain funds have entered into
arrangements with their custodian and transfer agent whereby interest
earned on uninvested cash balances is used to reduce custodian and transfer
agent expenses. Including these reductions, the total operating expenses
presented in the preceding tables for the applicable class would have been:
Class Class
T B
Mid Cap 1.60% 2.37%
Equity Growth 1.34% 1.95%
Strategic Opportunities 1.27% 1.79%
Large Cap 2.00% 2.50%
Equity Income 1.26% 1.79%
Balanced 1.20% 1.90%
High Yield 1.11% 1.79%
Strategic Income 1.22% 1.87%
Government Investment 0.99% 1.67%
Intermediate Bond 0.96% 1.66%
Short-Intermediate Municipal Income 0.89% *
California Municipal Income 0.87% 1.62%
New York Municipal Income 0.97% 1.62%
* FUND DOES NOT OFFER CLASS B SHARES
The following information replaces similar information regarding Growth
Opportunities found in "Expenses" on page 8.
EXPENSE TABLE EXAMPLE: You would pay the following expenses, including the
maximum front-end sales charge or CDSC, as applicable, on a $1,000
investment, assuming a 5% annual return and either (1) full redemption or
(2) no redemption, at the end of each time period:
EQUITY FUNDS
Examples
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Full Redemption No
Redempt
ion
Class Class T Class B Class B
A
GROWTH OPPORTUNITIES After 1 year $68 $48 $70[A] $20
After 3 years $92 $76 $91[A] $61
After 5 years $117 $10 $124[A $10
6 ] 4
After 10 $18 $19 $19 $19
years[B] 8 1 5 5
</TABLE>
[A] REFLECTS DEDUCTION OF APPLICABLE CDSC.
[B] REFLECTS CONVERSION OF CLASS B SHARES TO CLASS A SHARES AFTER SEVEN
YEARS.
For the funds listed below, the following information replaces similar
information relating to Class A shares found in "Expenses" beginning on
page 8.
EXPENSE TABLE EXAMPLE: You would pay the following expenses, including the
maximum front-end sales charge or CDSC, as applicable, on a $1,000
investment, assuming a 5% annual return and either (1) full redemption or
(2) no redemption, at the end of each time period:
EQUITY FUNDS
Example
s
Full
Redemption
Class A
TECHNOQUANT GROWTH After 1 year $71
After 3 years $99
MID CAP After 1 year $71
After 3 years $98
EQUITY GROWTH After 1 year $69
After 3 years $93
After 5 years $119
After 10 $194
years
Example
s
Full
Redemption
Class A
STRATEGIC OPPORTUNITIES After 1 year $70
After 3 years $95
After 5 years $122
After 10 $200
years
LARGE CAP After 1 year $74
After 3 years $109
GROWTH & INCOME After 1 year $69
After 3 years $93
EQUITY INCOME After 1 year $68
After 3 years $90
After 5 years $115
After 10 $184
years
BALANCED After 1 year $68
After 3 years $90
After 5 years $115
After 10 $184
years
TAXABLE INCOME FUNDS
Example
s
Full
Redemption
Class A
HIGH YIELD After 1 year $58
After 3 years $81
After 5 years $106
After 10 $177
years
STRATEGIC INCOME After 1 year $60
After 3 years $85
After 5 years $113
After 10 $191
years
MORTGAGE SECURITIES After 1 year $56
After 3 years $75
After 5 years $95
After 10 $153
years
GOVERNMENT INVESTMENT After 1 year $56
After 3 years $75
After 5 years $95
After 10 $153
years
INTERMEDIATE BOND After 1 year $46
After 3 years $65
After 5 years $85
After 10 $144
years
MUNICIPAL FUNDS
Example
s
Full
Redemption
Class A
HIGH INCOME MUNICIPAL After 1 year $56
After 3 years $75
After 5 years $95
After 10 $153
years
MUNICIPAL BOND After 1 year $56
After 3 years $75
After 5 years $95
After 10 $153
years
INTERMEDIATE MUNICIPAL INCOME After 1 year $46
After 3 years $65
After 5 years $85
After 10 $144
years
STATE MUNICIPAL FUNDS
Example
s
Full
Redemption
Class A
CALIFORNIA MUNICIPAL INCOME After 1 year $56
After 3 years $75
NEW YORK MUNICIPAL INCOME After 1 year $56
After 3 years $75
After 5 years $95
After 10 $153
years
The following information replaces similar information found in "Expenses"
on page 11.
If these agreements were not in effect, other expenses and total operating
expenses, as a percentage of average net assets, would have been the
following amounts:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Other Expenses Total Operating Expenses
Class Class Class Class Class Class B
A[A] T B A[A] T
Large Cap 0.96 1.34% 2.35% 1.81% 2.44% 3.95%
%
Strategic Income 0.65% (dagger) (dagger) 1.39% (dagger) (dagger)
Mortgage 2.25% 0.53% 1.08% 2.85% 1.23% 2.43%
Securities[A]
Government 0.72 (dagger) 0.43% 1.32% (dagger) 1.78%
Investment %
Intermediate Bond 0.48 (dagger) 0.44% 1.08% (dagger) 1.79%
%
Short Fixed-Income 0.50 (dagger) * 1.10% (dagger) *
%
High Income 0.48 (dagger) (dagger) 1.03% (dagger) (dagger)
Municipal %
Municipal Bond[A] 2.80% 0.37% 0.52% 3.35% 1.02% 1.82%
Intermediate 1.00% 0.39% 0.56% 1.55% 1.04% 1.86%
Municipal Income
Short-Intermediate 1.29% 0.60% * 1.84% 1.15% *
Municipal Income
California Municipal Income[A] 2.01% 0.38% 0.95% 2.50%[B 1.03% 2.25%
]
New York Municipal Income 1.95% 1.97% 2.42% 2.50% 2.62% 3.72%
</TABLE>
* FUND DOES NOT OFFER CLASS B SHARES.
[A] BASED ON ESTIMATED EXPENSES FOR THE FIRST YEAR.
[B] LIMITED IN ACCORDANCE WITH A STATE LIMITATION. WITHOUT THIS LIMITATION,
TOTAL OPERATING EXPENSES WOULD BE 2.56% FOR CALIFORNIA MUNICIPAL INCOME,
CLASS A.
(dagger) TOTAL OPERATING EXPENSES WERE LESS THAN THE VOLUNTARY EXPENSE CAPS
IN EFFECT DURING THE FISCAL YEAR ENDED 1996.
For the funds listed below, the following information replaces similar
information relating to Class A load adjusted total return figures found in
"Performance" on pages 30-32. The total return figures in the table below
reflect the August 1, 1997 increases in the funds' maximum Class A
front-end sales charges. Unless revised in this prospectus supplement, the
footnotes to the total return tables found in "Performance" on pages 35-36
remain unchanged.
EQUITY FUNDS - CLASS A
Average Annual Total ReturnF Cumulative Total ReturnF
Past 1 Past 5 10 Years/ Past 1 Past 5 10 Years/
year years Life of year years Life of
fund+ fund+
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
MID CAP - CLASS A (LOAD ADJ.) [A][C] n/a n/a n/a n/a n/a 10.27
%
EQUITY GROWTH - CLASS A (LOAD ADJ.) [A][C] 12.13 17.36 18.92 12.13 122.6 465.4
% % % % 4% 4%
GROWTH OPPORTUNITIES - CLASS A (LOAD ADJ.)[A][B] 10.78 16.27 19.84 10.78 112.5 406.4
% % % % 1% 6%
STRATEGIC OPPORTUNITIES - CLASS A (LOAD ADJ.) [A][D] (4.30) 10.78 11.21 (4.30) 66.84 189.4
% % % % % 3%
LARGE CAP - CLASS A (LOAD ADJ.) [A][C] n/a n/a n/a n/a n/a 11.50
%
EQUITY INCOME - CLASS A (LOAD ADJ.) [A][C] 11.97 17.59 12.53 11.97 124.7 225.6
% % % % 9% 7%
BALANCED - CLASS A (LOAD ADJ.)[A][B] 2.96% 7.35% 10.64 2.96% 42.58 170.1
% % 2%
</TABLE>
TAXABLE BOND FUNDS - CLASS A
Average Annual Total ReturnF Cumulative Total ReturnF
Past 1 Past 5 10 years/ Past 1 Past 5 10 years/
year years Life of year years Life of
fund+ fund+
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
HIGH YIELD - CLASS A (LOAD ADJ.)[A][B] 7.34% 13.24 13.17 7.34% 86.25 237.3
% % % 3%
STRATEGIC INCOME - CLASS A (LOAD ADJ.)[A][D] 7.45% n/a 13.37 7.45% n/a 31.34
% %
MORTGAGE SECURITIES - CLASS A 1.65% 6.75% 7.78% 1.65% 38.64 111.4
(LOAD ADJ.) [A][E] % 7%
GOVERNMENT INVESTMENT - CLASS A (LOAD ADJ.) [A][B] (0.61) 5.72% 6.52% (0.61) 32.08 85.96
% % % %
INTERMEDIATE BOND - CLASS A (LOAD ADJ.) [A][C] 0.93% 6.12% 7.26% 0.93% 34.60 101.5
% 0%
</TABLE>
MUNICIPAL FUNDS - CLASS A
Average Annual Total ReturnF Cumulative Total ReturnF
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Past 1 Past 5 10 years/ Past 1 Past 5 10 years/
year years Life of year years Life of
fund+ fund+
HIGH INCOME MUNICIPAL - CLASS A (LOAD ADJ.)[A][B] (0.53) 5.89% 8.52% (0.53) 33.16 111.11
% % % %
MUNICIPAL BOND - CLASS A (LOAD ADJ.)[A] [D] (1.05) 5.69% 6.69% (1.05) 31.88 91.13
% % % %
INTERMEDIATE MUNICIPAL INCOME - CLASS A 0.94% 5.21% 5.73% 0.94% 28.90 74.57
(LOAD ADJ.)[A][C] % %
</TABLE>
STATE MUNICIPAL FUNDS - CLASS A
Average Annual Total ReturnF Cumulative Total ReturnF
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Past 1 Past 5 10 years/ Past 1 Past 5 10 years/
year years Life of year years Life of
fund+ fund+
CALIFORNIA MUNICIPAL INCOME - CLASS A (LOAD n/a n/a n/a n/a n/a (2.87)
ADJ.)[A][B] %
NEW YORK MUNICIPAL INCOME - CLASS A (LOAD 0.23% n/a 4.23% 0.23% n/a 5.09%
ADJ.)[A][B]
</TABLE>
[A] LOAD ADJUSTED RETURNS INCLUDE THE EFFECT OF PAYING CLASS A'S MAXIMUM
FRONT-END SALES CHARGE OF 5.75% FOR THE EQUITY FUNDS; 4.75% FOR THE BOND
FUNDS; 3.75% FOR THE INTERMEDIATE-TERM BOND FUNDS; AND 1.50% FOR THE
SHORT-TERM BOND FUNDS. LOAD ADJUSTED RETURNS INCLUDE THE EFFECT OF PAYING
CLASS T'S MAXIMUM FRONT-END SALES CHARGE OF 3.50% FOR THE EQUITY FUNDS AND
BOND FUNDS; 2.75% FOR THE INTERMEDIATE-TERM BOND FUNDS; AND 1.50% FOR THE
SHORT-TERM BOND FUNDS. CLASS B'S CDSC INCLUDED IN THE TOTAL RETURN FIGURES
ARE CALCULATED PURSUANT TO THE CDSC SCHEDULES FOUND ON PAGE 62.
The following information replaces similar information found in footnote F
of the "Performance" section on page 36.
[F] CLASS A OF MUNICIPAL BOND COMMENCED OPERATIONS ON MARCH 3, 1997.
RETURNS BETWEEN JULY 1, 1996 AND FEBRUARY 28, 1997 ARE THOSE OF CLASS T AND
REFLECT CLASS T'S 0.25% 12B-1 FEE. RETURNS PRIOR TO THAT DATE ARE THOSE OF
INITIAL CLASS, THE ORIGINAL CLASS OF THE FUND WHICH DOES NOT BEAR A 12B-1
FEE. CLASS A'S RETURNS WOULD HAVE BEEN LOWER IF ITS 12B-1 FEE WAS REFLECTED
IN RETURNS PRIOR TO JULY 1, 1996.
INITIAL OFFERING OF CLASS B SHARES OF EQUITY GROWTH TOOK PLACE ON DECEMBER
31, 1996. CLASS B SHARES BEAR A 12B-1 FEE (INCLUDING A SHAREHOLDER
SERVICING FEE), WHICH IS NOT REFLECTED IN PRIOR RETURN DATES. RETURNS
BETWEEN SEPTEMBER 10, 1992 AND DECEMBER 31, 1996 ARE THOSE OF CLASS T AND
REFLECT CLASS T'S APPLICABLE 12B-1 FEE (0.65% PRIOR TO JANUARY 1, 1996).
RETURNS PRIOR TO SEPTEMBER 10, 1992 ARE THOSE OF INSTITUTIONAL CLASS, THE
ORIGINAL CLASS OF THE FUND, WHICH DOES NOT BEAR A 12B-1 FEE. CLASS B
RETURNS WOULD HAVE BEEN LOWER IF ITS 12B-1 FEE (INCLUDING A SHAREHOLDER
SERVICING FEE) HAD BEEN REFLECTED IN PRIOR DATE RETURNS.
INITIAL OFFERING OF CLASS B SHARES OF BALANCED TOOK PLACE ON DECEMBER 31,
1996. CLASS B SHARES BEAR A 12B-1 FEE (INCLUDING A SHAREHOLDER SERVICING
FEE), WHICH IS NOT REFLECTED IN PRIOR RETURN DATES. RETURNS BETWEEN JANUARY
6, 1987 AND DECEMBER 31, 1996 ARE THOSE OF CLASS T AND REFLECT CLASS T'S
APPLICABLE 12B-1 FEE (0.65% PRIOR TO JANUARY 1, 1996). CLASS B RETURNS
WOULD HAVE BEEN LOWER IF ITS 12B-1 FEE (INCLUDING A SHAREHOLDER SERVICING
FEE) HAD BEEN REFLECTED IN PRIOR DATE RETURNS.
The following information replaces similar information found in the
"Charter" section on page 38.
THE FUNDS MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These
meetings may be called to elect or remove trustees, change fundamental
policies, approve a management contract, or for other purposes.
Shareholders not attending these meetings are encouraged to vote by proxy.
The transfer agent will mail proxy materials in advance, including a voting
card and informatio n about the p roposals to be voted on. The number
of votes you are entitled to is based upon the dollar value of your
investment.
Effective September 1, 1997, the following information supplements the
information found under the heading "FMR and Its Affiliates" in the
"Charter" section beginning on page 38.
Brian Hogan is manager of Advisor Strategic Income Fund's emerging market
securities. Since joining Fidelity in 1994, Mr. Hogan has worked as a
fixed-income analyst, research analyst and manager. Previously, he worked
as an analyst for Conseco Capital Management form 1993 to 1994 and Aegon
USA Investment Management from 1990 to 1993.
The following information replaces similar information under the heading
"FMR and Its Affiliates" in the "Charter" section on page 39.
George Fischer is manager of Advisor Municipal Bond and Advisor High Income
Municipal, which he has managed since October 1995 and April 1997,
respectively. He also manages several other Fidelity funds. Since joining
Fidelity in 1989, Mr. Fischer has worked as an analyst and manager.
Effective October 1, 1997, t he following information replaces
similar information found under the heading "FMR and Its Affiliates" in the
"Charter" section on page 3 9 .
Kevin Grant is Vice President and manager of Advisor Intermediate Bond
and Advisor Balanced Fund's fixed-income investments, which he has managed
since October 1995 and March 1996, respectively. He manages other Fidelity
funds. Prior to joining Fidelity in 1993, Mr. Grant was a vice president
and chief mortgage strategist at Morgan Stanley for three years.
Thomas Silvia is manager of Advisor Mortgage Securities. He has been a
co-manager of the fund since February 1997. Mr. Silvia joined Fidelity
as a senior mortgage trader in 1993. Previously he was a quantitative
analyst with Donaldson, Lufkin & Jenrette in New York from 1990 to 1993.
The following information replaces similar information found under the
heading "FMR and Its Affiliates"in the "Charter" section on page 40.
As of May 31, 1997, approximately 44.14% and 28.67% of California Municipal
Income's and New York Municipal Income's total outstanding shares,
respectively, were held by an FMR affiliate. Therefore based on his
membership in this family group, Mr. Edward C. Johnson 3d may be deemed to
be a beneficial owner of these shares of California Municipal Income and
New York Municipal Income.
The following information replaces similar information found in "Investment
Principles and Risks" on page 43.
HIGH INCOME MUNICIPAL FUND seeks high current income that is free from
federal income tax by investing primarily in investment-grade municipal
securities. The fund may also invest up to 35% of its assets in below
investment-grade securities. FMR normally invests so that at least 80% of
the fund's assets are invested in municipal securities whose interest is
free from federal income tax. In addition, FMR may invest all of the fund's
assets in municipal securities issued to finance private activities. The
interest from these securities is a tax preference item for the purposes of
the federal alternative minimum tax.
Although the fund can invest in securities of any maturity, FMR seeks to
manage the fund so that it generally reacts to changes in interest rates
similarly to municipal bonds with maturities between eight and 18 years. As
of October 31, 1996, the fund's dollar-weighted average maturity was
approximately 16.4 years.
The following information replaces similar information found under the
heading "Equity Securities" in the "Securities and Investment Practices"
section on page 44.
RESTRICTIONS: With respect to 75% of its total assets, each of
TechnoQuant Growth, Mid Cap, Equity Growth, Growth Opportunities, Strategic
Opport unities, Large Cap, Growth & Income, Equity Income, Balanced,
High Yield, Mortgage Securities, Government Investment, Intermediate Bond,
Short Fixed-Income, High Income Municipal, Municipal Bond , and
Intermediate Municipal Income may not purchase more than 10% of the
outstanding voting securities of a single issuer. For TechnoQuant Growth,
Mid Cap, Equity Growth, Growth Opportunities, Strategic Opportunities,
Large Cap, and Growth & Income, this limitation does not apply to
securities of other investment com pani es.
The following information replaces similar information found under the
heading "Debt Securities" in the "Securities and Investment Practices"
section on page 46.
High Income Municipal currently intends to limit its investments in below
investment-grade securities to less than 35% of its assets and does not
currently intend to invest more than 10% of its total assets in bonds that
are in default. A security is considered to be investment-grade quality if
it is rated investment-grade by Moody's Investor Service, Standard and
Poor's, Duff & Phelps Credit Rating Co., or Fitch Investors Service L.P.,
or is unrated but judged by FMR to be of equivalent quality.
The following information replaces similar information found under the
heading "Cash Management" in the "Securities and Investment Practices"
section beginning on page 47.
RESTRICTIONS: California Municipal Income and New York Municipal
Income do not currently intend to invest in a money market fund. High
Income Municipal, Municipal Bond, Intermediate Municipal Income,
Short-Intermediate Municipal Income, California Municipal Income, and New
York Municipal Income do not currently intend to invest in repurchase
agreements.
The following information replaces similar information found under the
heading "Diversification" in the "Securities and Investment Practices"
section on page 48.
RESTRICTIONS: Wi th respect to 75% of its total assets, each of
TechnoQuant Growth, Mid Cap, Equity Growth, Growth Opportunities, Strategic
Opportunit ies, Large Cap, Growth & Income, Equity Income, Balanced,
High Yield, Mortgage Securities, Government Investment, Intermediate Bond,
Short Fixed-Income, High Income Municipal, Municipal Bond, and Intermediate
Municipal Income may not purchase a security if, as a result, more than 5%
would be invested in the securities of any one issuer. This limitation does
not apply to U.S. Government securities or, for TechnoQuant Growth, Mid
Cap, Equity Growth, Growth Opportunities, Strategic Opportunities,
Large Cap, and Growth & Income, to securities of other investment
companies.
The following information replaces similar information found in the
"Fundamental Investment Policies and Restrictions" section beginning
on page 48.
EQUITY GROWTH FUND seeks to achieve capital appreciation by investing
primarily in common and preferred stock and securities convertible into the
common stock of companies with above-average growth characteri stics.
With respect to 75% of its total assets, each of TechnoQuant Growth, Mid
Cap, Equity Growth, Growth Opportunities, Strategic Opportunities, Large
Cap, Growth & Income, Equity Income, Balanced, High Yield, Mortgage
Securities, Government Investment, Intermediate Bond, Short Fixed-Income,
High Income Municipal, Municipal Bond, and Intermediate Municipal Income
may not purchase a security if, as a result, more than 5% would be invested
in the securities of any one issuer. This limitation does not apply to U.S.
Gov ernment securities or, for TechnoQuant Growth, Mid Cap, Equity
Growth, Growth Opportunities,Strategic Opportunities, Large Cap, and
Growth & Income, to securities of other investment companies.
With respect to 75% of its total assets, each of TechnoQuant Growth, Mid
Cap, Equity Growth, Growth Opportunities, Strategic Opportunities, Large
Cap, Growth & Inc ome, Equity Income, Balanced, High Yield, Mortgage
Securities, Government Investment, Intermediate Bond, Short Fixed-Income,
High Income Municipal, Municipal Bond, and Intermediate Municipal Income
may not purchase more than 10% of the outstanding voting securities of a
single issuer. This limitation does not apply to U.S. Government securities
or, for TechnoQuant Growth, Mid Cap, Equity Growth, Growth
Opportunities,Strategic Opportunities, Large Cap, and Growth & Income, to
securities of other investment companies.
The following information replaces similar information under the heading
"Management Fee" in the "Breakdown of Expenses" section on page 50.
Investment performance for Growth Opportunities and Strategic Opportunities
will be represented by the average performance of all classes of the fund,
weighted according to their average assets for each month.
The following information replaces similar information regarding Equity
Growth under the heading "Management Fee" in the "Breakdown of Expenses"
section on page 50.
Group Individual Total
Fee Rate Fund Fee Manageme
Rate nt Fee
Equity Growth 0.30% 0.30% 0.61%
The following footnotes replace similar footnotes found under the
heading "Management Fee" in the "Breakdown of Expenses" section on page 50.
[A] ESTIMATED
[C] THE BASIC FEE RATE FOR THE FISCAL YEAR ENDED 1996 WAS 0.61% FOR GROWTH
OPPORTUNITIES AND 0.61% FOR STRATEGIC OPPORTUNITIES.
[D] EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO REDUCE THE FUND'S
INDIVIDUAL FUND FEE RATE FROM 0.20% TO 0.15%. IF THIS REDUCTION WAS NOT IN
EFFECT, THE TOTAL FEE WOULD HAVE BEEN 0.55%.
The following information replaces similar information found in "How to Buy
Shares" on page 54.
Once each business day, two share prices are calculated for Class A and
Class T shares of each fund: the offering price and the NAV. If you pay a
front-end sales charge or qualify for a reduction as described on page 61,
your Class A or Class T share price will be the offering price. If you
qualify for a front-end sales charge waiver as described on page 64, your
Class A or Class T share price will be the NAV. When you buy Class A or
Class T shares at the offering price, the transfer agent deducts the
appropriate sales charge and invests the rest in Class A or Class T shares
of the fund. Class B's NAV is also calculated every business day. Class B
shares of each fund are sold without a front-end sales charge and may be
subject to a CDSC upon redemption. For information on how the CDSC is
calculated, see "Transaction Details," page 60.
PURCHASE AMOUNTS OF MORE THAN $250,000 WILL NOT BE ACCEPTED FOR CLASS B
SHARES.
The following information replaces similar information found in "Investor
Services" on page 58.
FIDELITY ADVISOR SYSTEMATIC WITHDRAWAL PROGRAM lets you set up periodic
redemptions from your Class A, Class T, or Class B account. Accounts with a
value of $10,000 or more in Class A, Class T or Class B shares are eligible
for this program. Aggregate redemptions per 12 month period from your Class
B account may not exceed 10% of the account value and are not subject to a
CDSC. Because of Class A's and Class T's front-end sales charge, you may
not want to set up a systematic withdrawal plan during a period when you
are buying Class A or Class T shares on a regular basis.
The following information replaces similar information found in
"Transaction Details" on page 61.
THE OFFERING PRICE (price to buy one share) of Class A and Class T of each
fund is its NAV, divided by the difference between one and the applicable
sales charge percentage. Class A has a maximum sales charge of 5.75% of the
offering price for the Equity Funds; 4.75% of the offering price for the
Bond Funds; 3.75% of the offering price for the Intermediate-Term Bond
Funds; and 1.50% of the offering price for the Short-Term Bond Funds. Class
T has a maximum sales charge of 3.50% of the offering price for the Equity
Funds and the Bond Funds; 2.75% of the offering price for the
Intermediate-Term Bond Funds; and 1.50% of the offering price for the
Short-Term Bond Funds. The offering price of Class B of each fund is its
NAV. A class's REDEMPTION PRICE (price to sell one share) is its NAV minus
any applicable CDSC.
SALES CHARGES AND INVESTMENT PROFESSIONAL
CONCESSIONS - CLASS A
EQUITY FUNDS: Sales Charge Investment
Profession
al
Concession
as % of
Offering
Price
As a % of As an
Offering approxim
Price ate % of
Net
Amount
Invested
Up to $49,999 5.75% 6.10% 5.00%
$50,000 to $99,999 4.50% 4.71% 3.75%
$100,000 to $249,999 3.50% 3.63% 2.75%
$250,000 to $499,999 2.50% 2.56% 2.00%
$500,000 to $999,999 2.00% 2.04% 1.75%
$1,000,000 - $24,999,999 1.00% 1.01% 0.75%
$25,000,000 or more None* None* *
BOND FUNDS: Sales Charge Investment
Profession
al
Concession
as % of
Offering
Price
As a % of As an
Offering approxim
Price ate % of
Net
Amount
Invested
Up to $49,999 4.75% 4.99% 4.25%
$50,000 to $99,999 4.50% 4.71% 4.00%
$100,000 to $249,999 3.50% 3.63% 3.00%
$250,000 to $499,999 2.50% 2.56% 2.25%
$500,000 to $999,999 2.00% 2.04% 1.75%
$1,000,000 - $24,999,999 0.50% 0.50% 0.50%
$25,000,000 or more None* None* *
INTERMEDIATE-TERM BOND FUNDS: Sales Charge Investment
Profession
al
Concession
as % of
Offering
Price
As a % of As an
Offering approxim
Price ate % of
Net
Amount
Invested
Up to $49,999 3.75% 3.91% 3.00%
$50,000 to $99,999 3.00% 3.10% 2.25%
$100,000 to $249,999 2.25% 2.30% 1.75%
$250,000 to $499,999 1.75% 1.78% 1.50%
$500,000 to $999,999 1.50% 1.52% 1.25%
$1,000,000 - $24,999,999 0.50% 0.50% 0.50%
$25,000,000 or more None* None* *
SHORT-TERM BOND FUNDS: Sales Charge Investment
Profession
al
Concession
as % of
Offering
Price
As a % of As an
Offering approxim
Price ate % of
Net
Amount
Invested
Up to $499,999 1.50% 1.52% 1.25%
$500,000 to $999,999 1.00% 1.01% 0.75%
$1,000,000 - $24,999,999 None None None
$25,000,000 or more None* None *
*
* SEE SECTION ENTITLED FINDER'S FEE .
The following information replaces similar information found in
"Transaction Details" on page 62.
FINDER'S FEE . On eligible purchases of (i) Class A shares in amounts
of $1 million or more that qualify for a Class A load waiver, (ii) Class A
shares in amounts of $25 million or more, and (iii) Class T shares in
amounts of $1 million or more, investment professionals will be compensated
with a fee at the rate of 0.25% of the amount purchased.
Any assets on which a finder's fee has been paid will bear a CDSC
(Class A or Class T CDSC) if they do not remain in Class A or Class
T shares of the Fidelity Advisor funds, Daily Money Class (formerly Initial
Class) shares of Treasury Fund (formerly Daily Money Fund: U.S. Treasury
Portfolio), Prime Fund (formerly Daily Money Fund: Money Market Portfolio),
or Tax-Exempt Fund (formerly Daily Tax-Exempt Money Fund), for a period of
at least one uninterrupted year. The Class A or Class T CDSC will be 0.25%
of the lesser of the cost of the shares at the initial date of purchase or
the value of the shares at redemption, not including any reinvested
dividends or capital gains. Class A or Class T CDSC shares representing
reinvested dividends and capital gains, if any, will be redeemed first,
followed by other Class A or Class T CDSC shares that have been held for
the longest period of time.
Shares held by an insurance company separate account will be aggregated at
the client (e.g., the contract holder or plan sponsor) level, not at the
separate account level. Upon request, anyone claiming eligibility for the
0.25% fee with respect to shares held by an insurance company separate
account must provide FDC access to records detailing purchases at the
client level.
With respect to employee benefit plans, the Class A or Class T CDSC does
not apply to the following types of redemptions: (i) plan loans or
distributions or (ii) exchanges to non-Advisor fund investment options.
With respect to Individual Retirement Accounts, the Class A or Class T CDSC
does not apply to redemptions made for disability, payment of death
benefits, or required partial distributions starting at age 70. Your
investment professional should advise the transfer agent at the time your
redemption order is placed if you qualify for a waiver of the Class A or
Class T CDSC.
The following information replaces similar information found in
"Transaction Details" on page 63.
REINSTATEMENT PRIVILEGE. If you have sold all or part of your Class A,
Class T, or Class B shares of a fund, you may reinvest an amount equal to
all or a portion of the redemption proceeds in the same class of the fund
or any of the other Fidelity Advisor funds, at the NAV next determined
after receipt and acceptance of your investment order, provided that such
reinvestment is made within 90 days of redemption. Under these
circumstances, the dollar amount of the CDSC, if any, you paid on Class T
or Class B shares will be reimbursed to you by reinvesting that amount in
Class T shares or Class B shares, as applicable. The dollar amount of the
CDSC, if any, you paid on Class A shares will likewise be reimbursed to you
by reinvesting that amount in Class A shares. You must reinstate your
shares into an account with the same registration. This privilege may be
exercised only once by a shareholder with respect to a fund and certain
restrictions may apply. For purposes of the CDSC holding period schedule,
the holding period of your Class T or Class B shares will continue as if
the shares had not been redeemed. For purposes of the CDSC holding period
schedule, the holding period of your Class A shares will also continue as
if the shares had not been redeemed.
The following information replaces similar information found in "Exchange
Restrictions" on page 64.
(small solid bullet) Any exchanges of Class A, Class T, or Class B shares
are not subject to a CDSC.
The following information supplements information found in "Sales Charge
Reductions and Waivers" on page 65.
A FRONT-END SALES CHARGE WILL NOT APPLY TO THE FOLLOWING CLASS A SHARES:
1. Purchased for an insurance company separate account used to fund annuity
contracts for employee benefit plans which, in the aggregate, have more
than 200 eligible employees or a minimum of $1 million in plan assets
invested in Fidelity Advisor funds;
2. Purchased by a trust institution or bank trust department (excluding
employee benefit plan assets) that has executed a participation agreement
with FDC specifying certain asset minimums and qualifications, and
marketing restrictions. Assets managed by third parties do not qualify for
this waiver;
3. Purchased for use in a broker-dealer managed account program, provided
the broker-dealer has executed a participation agreement with FDC
specifying certain asset minimums and qualifications, and marketing,
program and trading restrictions. Employee benefit plan assets do not
qualify for this waiver;
4. Purchased on a discretionary basis by a registered investment advisor
which is not part of an organization primarily engaged in the brokerage
business, that has executed a participation agreement with FDC specifying
certain asset minimums and qualifications, and marketing, program and
trading restrictions. Employee benefit plan assets do not qualify for this
waiver; or
5. Purchased as part of an employee benefit plan having $25 million or more
in plan assets.
For the purpose of load waiver (3) certain broker dealers that otherwise
meet the qualifications and asset minimums established by FDC are not
required to sign a participation agreement.
The following information replaces similar information found in "Sales
Charge Reductions and Waivers" on page 66.
If you are investing through an account managed by a broker-dealer, if you
have authorized an investment adviser to make investment decisions for you,
or if you are investing through a trust department, you may qualify to
purchase Class T shares without a sales charge (as described in (9), (10)
and (13), above), Class A shares without a sales charge (as described in
(2), (3) and (4) above), or Institutional Class shares. Because
Institutional Class shares have no sales charge, and do not pay a
distribution fee or a shareholder service fee, Institutional Class shares
are expected to have a higher total return than Class A, Class T, or Class
B shares. Contact your investment professional to discuss if you qualify.
THE CDSC ON CLASS B SHARES MAY BE WAIVED:
1. In cases of disability or death, provided that Class B shares are
redeemed within one year following the death or the initial determination
of disability;
2. In connection with a total or partial redemption related to certain
distributions from retirement plans or accounts at age 70, which are
permitted without penalty pursuant to the Internal Revenue Code; or
3. In connection with redemptions through the Fidelity Advisor Systematic
Withdrawal Program.
SUPPLEMENT TO THE FIDELITY ADVISOR FUNDS
INSTITUTIONAL CLASS FEBRUARY 28,1997 PROSPECTUS
The following information replaces similar information on the cover page.
High Yield and Strategic Income may each invest without limitation in
lower-quality debt securities, sometimes called "junk bonds." Investors
should consider that these securities carry greater risks, such as the risk
of default, than other debt securities. Refer to "Investment Principles and
Risks" on page 23 for further information.
The following information replaces similar information found in "Who May
Want to Invest" on page 3.
High Income Municipal, Municipal Bond, Intermediate Municipal Income, and
Short-Intermediate Municipal Income are designed for investors in higher
tax brackets who seek high current income that is free from federal income
tax. Municipal Bond, Intermediate Municipal Income, and Short-Intermediate
Municipal Income also invest consistent with consideration of capital
preservation. High Income Municipal may invest in lower-quality municipal
securities which invoke greater risks than the investment-grade securities.
The following information replaces similar information found in "Who May
Want to Invest" on page 4.
Each fund is composed of multiple classes of shares. All classes of a fund
have a common investment objective and investment portfolio. Class A and
Class T shares have a front-end sales charge and pay a distribution fee.
Class A and Class T shares may be subject to a contingent deferred sales
charge (CDSC). Class B shares do not have a front-end sales charge, but do
have a CDSC, and pay a distribution fee and a shareholder service fee.
Because Institutional Class shares have no sales charge and do not pay a
distribution fee or a shareholder service fee, Institutional Class shares
are expected to have a higher total return than Class A, Class T or Class B
shares.
The following information replaces similar information regarding Equity
Growth found in "Expenses" on page 5.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
EQUITY GROWTH Management fee 0.61% After 1 $ 8
year
12b-1 fee (Distribution None After 3 $ 25
fee) years
Other expenses 0.18% After 5 $ 44
years
Total operating expenses 0.79% After 10 $ 98
years
</TABLE>
T he following footnotes replace similar footnotes found in "Expenses" on
page 5 .
[A] BASED ON ESTIMATED EXPENSES FOR FIRST YEAR.
[C] EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
0.20% TO 0.15%. IF THIS AGREEMENT WAS NOT IN EFFECT, THE MANAGEMENT FEE
WOULD BE 0.50% AND TOTAL OPERATING EXPENSES WOULD BE 1.06%.
The following information replaces similar information found in the
"Charter" section on page 21.
THE FUNDS MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These
meetings may be called to elect or remove trustees, change fundamental
policies, approve a management contract, or for other purposes.
Shareholders not attending these meetings are encouraged to vote by proxy.
The transfer agent will mail proxy materials in advance, including a voting
card and information about the proposals to be voted on. T he number
of votes you are entitled to is based upon the dollar value of your
investment.
Effective September 1, 1997, the following information supplements the
information found under the heading "FMR and Its Affiliates" in the
"Charter" section beginning on page 21.
Brian Hogan is manager of Advisor Strategic Income Fund's emerging market
securities. Since joining Fidelity in 1994, Mr. Hogan has worked as a
fixed-income analyst, research analyst and manager. Previously, he worked
as an analyst for Conseco Capital Management from 1993 to 1994 and Aegon
USA Investment Management from 1990 to 1993.
The following information replaces similar information under the heading
"FMR and Its Affiliates" in the "Charter" section on page 22.
George Fischer is manager of Advisor Municipal Bond and Advisor High Income
Municipal, which he has managed since October 1995 and April 1997,
respectively. He also manages several other Fidelity funds. Since joining
Fidelity in 1989, Mr. Fischer has worked as an analyst and manager.
Effective October 1, 1997, the following information replaces similar
information found under the heading "FMR and Its Affiliates" in the
"Charter" section on page 22.
Kevin Grant is Vice President and manager of Advisor Intermediate Bond and
Advisor Balanced Fund's fixed-income investments, which he has managed
since October 1995 and March 1996, respectively. He manages other Fidelity
funds. Prior to joining Fidelity in 1993, Mr. Grant was a vice president
and chief mortgage strategist at Morgan Stanley for three years.
Thomas Silvia is manager of Advisor Mortgage Securities. He has been a
co-manager of the fund since February 1997. Mr. Silvia joined Fidelity as a
senior mortgage trader in 1993. Previously he was a quantitative analyst
with Donaldson, Lufkin & Jenrette in New York from 1990 to 1993.
The following information supplements the information found under the
heading "FMR and Its Affiliates" in the "Charter" section on page 23.
As of May 31, 1997, approximately 44.14% and 28.67% of California Municipal
Income's and New York Municipal Income's total outstanding shares,
respectively, were held by an FMR affiliate. Therefore based on his
membership in this family group, Mr. Edward C. Johnson 3d may be deemed to
be a beneficial owner of these shares of California Municipal Income and
New York Municipal Income.
The following information replaces similar information found in "Investment
Principles and Risks" on page 26.
HIGH INCOME MUNICIPAL FUND seeks high current income that is free from
federal income tax by investing primarily in investment-grade municipal
securities. The fund may also invest up to 35% of its assets in below
investment-grade securities. FMR normally invests so that at least 80% of
the fund's assets are invested in municipal securities whose interest is
free from federal income tax. In addition, FMR may invest all of the fund's
assets in municipal securities issued to finance private activities. The
interest from these securities is a tax preference item for the purposes of
the federal alternative minimum tax.
Although the fund can invest in securities of any maturity, FMR seeks to
manage the fund so that it generally reacts to changes in interest rates
similarly to municipal bonds with maturities between eight and 18 years. As
of October 31, 1996, the fund's dollar-weighted average maturity was
approximately 16.4 years.
The following information replaces similar information found under the
heading "Equity Securities" in the "Securities and Investment Practices"
section on page 27.
RESTRICTIONS: With respect to 75% of its total assets, each of TechnoQuant
Growth, Mi d Cap, Equity Growth, Growth Opportunities, Strategic
Opportunit ies, Large Cap, Growth & Income, Equity Income, Balanced,
High Yield, Mortgage Securities, Government Investment, Intermediate Bond,
Short Fixed-Income, High Income Municipal, Municipal Bond, and Intermediate
Municipal Income may not purchase more than 10% of the outstanding voting
securities of a single issuer. For TechnoQuant Growth, Mid Cap, Equity
Growth, G rowth Opportunities, Strategic Opportunities, Large Cap, and
Growth & Income, this limitation does not apply to securities of other
investment comp anies .
The following information replaces similar information found under the
heading "Debt Securities" in the "Securities and Investment Practices"
section on page 29.
High Income Municipal currently intends to limit its investments in below
investment-grade securities to less than 35% of its assets and does not
currently intend to invest more than 10% of its total assets in bonds that
are in default. A security is considered to be investment-grade if it is
rated investment-grade by Moody's Investor Service, Standard and Poor's,
Duff & Phelps Credit Rating Co., or Fitch Investors Service, L.P., or is
unrated but judged by FMR to be of equivalent quality.
The following information replaces similar information found under the
heading "Cash Management" in the "Securities and Investment Practices"
section on page 30.
RESTRICTIONS: California Municipal Income and New York Municipal Income do
not currently intend to invest in a money market fund. High Income
Municipal, Municipal Bond, Intermediate Municipal Income,
Short-Intermediate Municipal Income, California Municipal Income, and New
York Municipal Income do not currently intend to invest in repurchase
agreements.
The following information replaces similar information found under the
heading "Diversification" in the "Securities and Investment Practices"
section on page 31.
With respect to 75% of its total assets, each of TechnoQuant Growth,
Mid Cap, Equity Growth, Growth Opportunities, Strategic Opportunities,
Large Cap, Growth & Income, Equity Income, Balanced, High Yield,
Mortgage Securities, Government Investment, Intermediate Bond, Short
Fixed-Income, High Income Municipal, Municipal Bond, and Intermediate
Municipal Income may not purchase a security if, as a result, more than 5%
would be invested in the securities of any one issuer. This limitation does
not apply to U.S. Government securities or, for Tech noQuant Growth, Mid
Cap, Equity Growth, Growth Opportunities, Strategic Opportunities, Large
Cap, and Growth & Income, to securities of other investment companies.
The following information replaces similar information found in the
"Fundamental Investment Policies and Restrictions" section beginning on
page 31.
E QUITY GROWTH FUND seeks to achieve capital appreciation by investing
primarily in common and preferred stock and securities convertible into the
common stock of companies with above-average growth characteristics.
With respect to 75% of its total assets, each of TechnoQuant Gro wth, Mid
Cap, Equity Growth, Growth Opportunities, Strategic Oppor tunities,
Large Cap, Growth & Income, Equity Income, Balanced, High Yield, Mortgage
Securities, Government Investment, Intermediate Bond, Short Fixed-Income,
High Income Municipal, Municipal Bond, and Intermediate Municipal Income
may not purchase a security if, as a result, more than 5% would be invested
in the securities of any one issuer. This limitation does not apply to U.S.
Government securities or, for TechnoQuant Growth, Mid Cap, E quity
G rowth, Gro wth Opportunities, Strategic Opportunities, Large Cap,
and Growt h & Income, to securities of other investment companies.
With respect to 75% of its total assets, each of TechnoQuant Growth, Mid
Cap, E quity Growth, Growth Opportunities, Strategic Opportunities,
Large Cap, Growth & Income, Equity Income, Balanced, High Yield, Mortgage
Securities, Government Investment, Intermediate Bond, Short Fixed-Income,
High Income Municipal, Municipal Bond, and Intermediate Municipal Income
may not purchase more than 10% of the outstanding voting securities of a
single issuer. These limitations do not apply to U.S. Government securities
or, for TechnoQuant Growth, Mid Cap, Equity Growth, Growth
Opportunities, Strategic Opportunities, Large Cap, and Growth & Incom e,
to securities of other investment companies.
The following information replaces similar information found under the
heading "Management Fee" in the "Breakdown of Expenses" section on page 33.
Investment performance for Growth Opportunities and Strategic Opportunities
will be represented by the average performance of all classes of the fund,
weighted according to their average assets for each month.
The following information replaces similar information regarding Equity
Growth found under the heading "Management Fee" in the "Breakdown of
Expenses" section on page 33.
Group
Individual
Total
Fee Rate Fund Fee
Manageme
Rate nt Fee
Equity Growth 0.30% 0.30% 0.61%
The following footnotes replace similar footnotes found under the
heading "Management Fee" in the "Breakdown of Expenses" section on page 33.
[A] ESTIMATED
[C] THE BASIC FEE RATE FOR THE FISCAL YEAR ENDED 1996 WAS 0.61% FOR GROWTH
OPPORTUNITIES AND 0.61% FOR STRATEGIC OPPORTUNITIES.
[D] EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO REDUCE THE FUND'S
INDIVIDUAL FUND FEE RATE FROM 0.20% TO 0.15%. IF THIS REDUCTION WAS NOT IN
EFFECT, THE TOTAL FEE WOULD HAVE BEEN 0.55%.
The following information supplements the information found in "Exchange
Restrictions" on page 43.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose fees
of up to 1.00% on purchases, administrative fees of up to $7.50, and
redemption fees of up to 1.50% on exchanges. Check each fund's prospectus
for details.
SUPPLEMENT TO THE FIDELITY ADVISOR FUNDS:
CLASS A, CLASS T, CLASS B, INSTITUTIONAL CLASS, AND INITIAL CLASS
FEBRUARY 28, 1997
STATEMENT OF ADDITIONAL INFORMATION
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN "INVESTMENT
POLICIES AND LIMITATIONS" BEGINNING ON PAGE 5.
MID CAP FUND
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) with respect to 75% of the fund's total assets, purchase the securities
of any issuer (other than securities issued or guaranteed by the U.S.
Government or any of its agencies or instrumentalities or securities of
other investment companies) if, as a result, (a) more than 5% of the fund's
total assets would be invested in the securities of that issuer, or (b) the
fund would hold more than 10% of the outstanding voting securities of that
issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that the
fund may be considered an underwriter within the meaning of the Securities
Act of 1933 in the disposition of restricted securities;
(5) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. Government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical
commodities); or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(9) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company managed by Fidelity Management &
Research Company or an affiliate or successor with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (3)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than securities
to other parties, except by (a) lending money (up to 5% of the fund's net
assets) to a registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) acquiring loans, loan
participations, or other forms of direct debt instruments and, in
connection therewith, assuming any associated unfunded commitments of the
sellers. (This limitation does not apply to purchases of debt securities or
to repurchase agreements.)
(vi) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
Fidelity Management & Research Company or an affiliate or successor with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
For the fund's limitations on futures and options transactions, see the
section entitled "Limitations on Futures and Options Transactions" on page
30.
EQUITY GROWTH FUND
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) with respect to 75% of the fund's total assets, purchase the securities
of any issuer (other than securities issued or guaranteed by the U.S.
Government or any of its agencies or instrumentalities or securities of
other investment companies) if, as a result, (a) more than 5% of the fund's
total assets would be invested in the securities of that issuer, or (b) the
fund would hold more than 10% of the outstanding voting securities of that
issuer;
(2) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(3) underwrite any issue of securities (to the extent that the fund may be
deemed to be an underwriter within the meaning of the Securities Act of
1933 in the disposition of restricted securities);
(4) purchase the securities of any issuer (other than obligations issued or
guaranteed by the Government of the United States, its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets (taken at current value) would be invested in the securities of
issuers having their principal business activities in the same industry;
(5) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(6) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical
commodities); or
(7) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(8) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company managed by Fidelity Management &
Research Company or an affiliate or successor with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin;
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (2)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than securities
to other parties, except by (a) lending money (up to 5% of the fund's net
assets) to a registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) acquiring loans, loan
participations, or other forms of direct debt instruments and, in
connection therewith, assuming any associated unfunded commitments of the
sellers. (This limitation does not apply to purchases of debt securities or
to repurchase agreements.)
(vi) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
Fidelity Management & Research Company or an affiliate or successor with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
For the fund's limitations on futures and options transactions, see the
section entitled "Limitations on Futures and Options Transactions" on page
30.
GROWTH OPPORTUNITIES FUND
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) with respect to 75% of the fund's total assets, purchase the securities
of any issuer (other than securities issued or guaranteed by the U.S.
government or any of its agencies or instrumentalities, or securities of
other investment companies) if, as a result, (a) more than 5% of the fund's
total assets would be invested in the securities of that issuer, or (b) the
fund would hold more than 10% of the outstanding voting securities of that
issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others except to the extent that the
fund may be considered an underwriter within the meaning of the Securities
Act of 1933, in the disposition of restricted securities;
(5) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical
commodities); or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(9) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED WITHOUT
SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (3)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than securities
to other parties, except by (a) lending money (up to 5% of the fund's net
assets) to a registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) acquiring loans, loan
participations, or other forms of direct debt instruments and, in
connection therewith, assuming any associated unfunded commitments of the
sellers. (This limitation does not apply to purchases of debt securities or
to repurchase agreements.)
(vi) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
For the fund's limitations on futures and options transactions, see the
section entitled "Limitations on Futures and Options Transactions" on page
30.
STRATEGIC OPPORTUNITIES FUND
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) with respect to 75% of the fund's total assets, purchase the securities
of any issuer (other than securities issued or guaranteed by the U.S.
government or any of its agencies or instrumentalities or securities of
other investment companies) if, as a result, (a) more than 5% of the fund's
total assets would be invested in the securities of that issuer, or (b) the
fund would hold more than 10% of the outstanding voting securities of that
issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that the
fund may be considered an underwriter within the meaning of the Securities
Act of 1933 in the disposition of restricted securities;
(5) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities of other instruments (but this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical
commodities); or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(9) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company managed by Fidelity Management &
Research Company or an affiliate or successor with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (3)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than securities
to other parties, except by (a) lending money (up to 5% of the fund's net
assets) to a registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) acquiring loans, loan
participations, or other forms of direct debt instruments and, in
connection therewith, assuming any associated unfunded commitments of the
sellers. (This limitation does not apply to purchases of debt securities or
to repurchase agreements.)
(vi) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
Fidelity Management & Research Company or an affiliate or successor with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
For the fund's limitations on futures and options transactions, see the
section entitled "Limitations on Futures and Options Transactions" on page
30.
LARGE CAP FUND
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) with respect to 75% of the fund's total assets, purchase the securities
of any issuer (other than securities issued or guaranteed by the U.S.
Government or any of its agencies or instrumentalities or securities of
other investment companies) if, as a result, (a) more than 5% of the fund's
total assets would be invested in the securities of that issuer, or (b) the
fund would hold more than 10% of the outstanding voting securities of that
issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) in an amount not
exceeding 33 1/3% of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to exceed
this amount will be reduced within three days (not including Sundays and
holidays) to the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that the
fund may be considered an underwriter within the meaning of the Securities
Act of 1933 in the disposition of restricted securities;
(5) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. Government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments (but this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical
commodities); or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(9) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company managed by Fidelity Management &
Research Company or an affiliate or successor with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party (reverse repurchase agreements are treated as borrowings for
purposes of fundamental investment limitation (3)). The fund will not
purchase any security while borrowings representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to lend assets other than securities
to other parties, except by (a) lending money (up to 5% of the fund's net
assets) to a registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) acquiring loans, loan
participations, or other forms of direct debt instruments and, in
connection therewith, assuming any associated unfunded commitments of the
sellers. (This limitation does not apply to purchases of debt securities or
to repurchase agreements.)
(vi) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
Fidelity Management & Research Company or an affiliate or successor with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
For the fund's limitations on futures and options transactions, see the
section entitled "Limitations on Futures and Options Transactions" on
page 30.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION IN "INVESTMENT
POLICIES AND LIMITATIONS" BEGINNING ON PAGES 35.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund purchases a
security and simultaneously commits to sell that security back to the
original seller at an agreed-upon price. The resale price reflects the
purchase price plus an agreed-upon incremental amount which is unrelated to
the coupon rate or maturity of the purchased security. To protect a fund
from the risk that the original seller will not fulfill its obligation, the
securities are held in an account of the fund at a bank, marked-to-market
daily, and maintained at a value at least equal to the sale price plus the
accrued incremental amount. While it does not presently appear possible to
eliminate all risks from these transactions (particularly the possibility
that the value of the underlying security will be less than the resale
price, as well as delays and costs to the fund in connection with
bankruptcy proceedings), it is each fund's current policy to engage in
repurchase agreement transactions with parties whose creditworthiness has
been reviewed and found satisfactory by FMR.
THE FOLLOWING INFORMATION HAS BEEN REMOVED FROM "INVESTMENT POLICIES AND
LIMITATIONS" ON PAGE 38.
FUNDAMENTAL POLICIES: It is the policy of Equity Growth to engage in
repurchase agreement transactions only with banks of the Federal Reserve
System and primary dealers in U.S. Government securities.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION IN "PERFORMANCE"
BEGINNING ON PAGE 68.
The following tables and charts show performance for each class of shares
of each fund. Class A shares have a maximum front-end sales charge of 5.25%
for TechnoQuant Growth, Overseas, Mid Cap, Equity Growth, Growth
Opportunities, Strategic Opportunities, Large Cap, Growth & Income, Equity
Income, and Balanced (the Equity Funds); 4.25% for Emerging Markets Income,
High Yield, Strategic Income, Mortgage Securities, Government Investment,
High Income Municipal, Municipal Bond, New York Municipal Income, and
California Municipal Income (the Bond Funds); 3.25% for Intermediate Bond
and Intermediate Municipal Income (the Intermediate-Term Bond Funds); and
1.50% for Short Fixed-Income and Short-Intermediate Municipal Income (the
Short-Term Bond Funds). EFFECTIVE AUGUST 1, 1997, the Equity Funds', Bond
Funds' , and the Intermediate - Term Bond Funds' Class A shares
maximum front-end sales charges increase as follows: 5.75% for the Equity
Funds; 4.75% for the Bond Funds; and 3.75% for the Intermediate - Term
Bond Funds. As the case may be, the performance numbers herein reflect the
Class A shares maximum front-end sales charges as in effect through July
31, 1997. Class A shares are also subject to a 12b-1 fee of 0.25% (Equity
Funds), and 0.15% (Bond Funds, Intermediate-Term Bond Funds, and Short-Term
Bond Funds). Class T shares have a maximum front-end sales charge of 3.50%
for the Equity Funds, 3.50% for the Bond Funds, 2.75% for the
Intermediate-Term Bond Funds, and 1.50% for the Short-Term Bond Funds.
Class T shares are also subject to a 12b-1 fee of 0.50% (the Equity Funds),
0.25% (the Bond Funds and the Intermediate-Term Bond Funds), and 0.15% (the
Short-Term Bond Funds). Class B shares have contingent deferred sales
charges (CDSC) upon redemption: maximum CDSC is 5.00% for all funds that
offer Class B except the Intermediate-Term Bond Funds, which have a maximum
CDSC of 3.00%. Class B shares are also subject to a 12b-1 fee of 0.75% (the
Equity Funds) or 0.65% (the Bonds Funds and the Intermediate-Term Bond
Funds), as well as a 0.25% shareholder services fee. Institutional Class
shares do not have a sales charge or a 12b-1 fee. Initial Class shares of
Strategic Opportunities have a front-end sales charge of 3.50% and no 12b-1
fee. Initial Class shares of Mortgage Securities and Municipal Bond do not
have a sales charge or a 12b-1 fee.
THE FOLLOWING INFORMATION SUPPLEMENTS INFORMATION FOUND IN "ADDITIONAL
PURCHASE, EXCHANGE, AND REDEMPTION INFORMATION" ON PAGE 119.
CLASS A SHARES ONLY
Pursuant to Rule 22d-1 under the 1940 Act, FDC exercises its right to waive
Class A's maximum 5.75% (Equity Funds); 4.75% (Bond Funds); 3.75%
(Intermediate Bond Funds); or 1.50% (Short Bond Funds) front-end sales
charge in connection with a fund's merger with or acquisition of any
investment company or trust. In addition, FDC has chosen to waive Class A's
front-end sales charge in certain instances because of efficiencies
involved in those sales of shares. The sales charge will not apply:
1. to shares purchased by an insurance company separate account used to
fund annuity contracts purchased by employee benefit plans (including
403(b) programs, but otherwise as defined in ERISA), which, in the
aggregate, have either more than 200 eligible employees or a minimum of
$1,000,000 in assets invested in Fidelity Advisor funds;
2. to shares purchased by a trust institution or bank trust department
(excluding employee benefit plan assets) that has executed a participation
agreement with FDC specifying certain asset minimums and qualifications,
and marketing restrictions. Assets managed by third parties do not qualify
for this waiver;
3. to shares purchased for use in a broker-dealer managed account program,
provided the broker-dealer has executed a participation agreement with FDC
specifying certain asset minimums and qualifications, and marketing,
program and trading restrictions. Employee benefit plan assets do not
qualify for this waiver; or
4. to shares purchased on a discretionary basis by a registered investment
adviser which is not part of an organization primarily engaged in the
brokerage business, that has executed a participation agreement with FDC
specifying certain asset minimums and qualifications, and marketing,
program and trading restrictions. Employee benefit plan assets do not
qualify for this waiver.
5. To shares purchased by an employee benefit plan having $25 million or
more in plan assets.
For the purpose of load waiver (3), certain broker-dealers that otherwise
meet the qualifications and asset minimums established by FDC are not
required to sign a participation agreement.
A sales load waiver form must accompany these transactions.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN "ADDITIONAL
PURCHASE, EXCHANGE, AND REDEMPTION INFORMATION" ON PAGE 120.
FINDERS FEE. On eligible purchases of (i) Class A shares in amounts of $1
million or more that qualify for a Class A load waiver, (ii) Class A shares
in amounts of $25 million or more, and (iii) Class T shares in amounts of
$1 million or more, investment professionals will be compensated with a fee
of 0.25%. Class A eligible purchases are the following purchases made
through broker-dealers and banks: an individual trade of $25 million or
more; an individual trade of $1 million or more that is load waived; a
trade which brings the value of the accumulated account(s) of an investor
(including an employee benefit plan) past $25 million; a load waived trade
that brings the value of the accumulated account(s) of an investor
(including an employee benefit plan) past $1 million; a trade for an
investor with an accumulated account value of $25 million or more; a load
waived trade for an investor with an accumulated account value of $1
million or more; an incremental trade toward an investor's $25 million
"Letter of Intent"; and an incremental load waived trade toward an
investor's $1 million "Letter of Intent". Class T eligible purchases are
the following purchases made through broker-dealers and banks: an
individual trade of $1 million or more; a trade which brings the value of
the accumulated account(s) of an investor (including an employee benefit
plan) past $1 million; a trade for an investor with an accumulated account
value of $1 million or more; and an incremental trade toward an investor's
$1 million "Letter of Intent."
Any assets in relation to which an investment professional has received
such compensation will bear a contingent deferred sales charge (Class A or
Class T CDSC) if they do not remain in Class A or Class T shares of the
Fidelity Advisor Funds, Daily Money Class (formerly Initial Class) shares
of Treasury Fund (formerly Daily Money Fund: U.S. Treasury Portfolio),
Prime Fund (formerly Daily Money Fund: Money Market Portfolio), or shares
of Tax-Exempt Fund (formerly Daily Tax-Exempt Money Fund), for a period of
at least one uninterrupted year. The Class A or Class T CDSC will be 0.25%
of the lesser of the cost of the shares at the initial date of purchase or
the value of the shares at redemption, not including any reinvested
dividends or capital gains. Class A or Class T CDSC shares representing
reinvested dividends or capital gains, if any, will be redeemed first,
followed by other Class A or Class T CDSC shares that have been held for
the longest period of time.
With respect to employee benefit plans, the Class A or Class T CDSC does
not apply to the following types of redemptions: (i) plan loans or
distributions or (ii) exchanges to non-Advisor fund investment options.
With respect to Individual Retirement Accounts, the Class A or Class T CDSC
does not apply to redemptions made for disability, payment of death
benefits, or required partial distributions starting at age 70 1/2.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN
"ADDITIONAL PURCHASE, EXCHANGE, AND REDEMPTION INFORMATION" ON PAGE
121.
CLASS B SHARES ONLY
The contingent deferred sales charge (CDSC) on Class B shares may be waived
(1) in the case of disability or death, provided that Class B shares are
redeemed within one year following the death or the initial determination
of disability; (2) in connection with a total or partial redemption related
to certain distributions from retirement plans or accounts at age 70 1/2,
which are permitted without penalty pursuant to the Internal Revenue Code;
or (3) in connection with redemptions through the Fidelity Advisor
Systematic Withdrawal Program.
A sales load waiver form must accompany these transactions.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN
"ADDITIONAL PURCHASE, EXCHANGE, AND REDEMPTION INFORMATION" ON PAGE
122.
CLASS A, CLASS T, CLASS B, AND INSTITUTIONAL CLASS SHARES ONLY
FIDELITY ADVISOR SYSTEMATIC WITHDRAWAL PROGRAM. If you own Class A, Class
T, or Institutional Class shares worth $10,000 or more, you can have
monthly, quarterly or semi-annual checks sent from your account to you, to
a person named by you, or to your bank checking account. If you own Class B
shares worth $10,000 or more, you can have monthly or quarterly checks sent
from your account to you, to a person named by you, or to your bank
checking account. Aggregate redemptions per 12 month period from your Class
B account may not exceed 10% of the value of the account and are not
subject to a CDSC; and you may set your withdrawal amount as a percentage
of the value of your account or a fixed dollar amount. Your Systematic
Withdrawal Program payments are drawn from Class A, Class T, Class B, or
Institutional Class share redemptions, as applicable. If Systematic
Withdrawal Plan redemptions exceed income dividends earned on your shares,
your account eventually may be exhausted.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN
"DISTRIBUTIONS AND TAXES" ON PAGE 123.
Each municipal fund purchases securities whose interest FMR believes is
free from federal income tax. Generally, issuers or other parties have
entered into covenants requiring continuing compliance with federal tax
requirements to preserve the tax-free status of interest payments over the
life of the security. If at any time the covenants are not complied with,
or if the IRS otherwise determines that the issuer did not comply with
relevant tax requirements, interest payments from a security could become
federally taxable retroactive to the date the security was issued. For
certain types of structured securities, the tax status of the pass-through
of tax-free income may also be based on the federal and state tax treatment
of the structure.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN
"TRUSTEES AND OFFICERS" BEGINNING ON PAGE 126.
The Trustees, Members of the Advisory Board, and executive officers of the
trusts are listed below. Except as indicated, each individual has held the
office shown or other offices in the same company for the last five years.
All persons named as Trustees and Members of the Advisory Board also serve
in similar capacities for other funds advised by FMR. The business address
of each Trustee, Member of the Advisory Board, and officer who is an
"interested person" (as defined in the 1940 Act) is 82 Devonshire Street,
Boston, Massachusetts 02109, which is also the address of FMR. The business
address of all the other Trustees is Fidelity Investments, P.O. Box 9235,
Boston, Massachusetts 02205-9235. Those Trustees and Members of the
Advisory Board who are "interested persons" by virtue of their affiliation
with either a trust or FMR are indicated by an asterisk (*).
*J. GARY BURKHEAD (55), Member of the Advisory Board (1997), is Vice
Chairman of FMR Corp. (1997) and President of Fidelity Investments
Institutional Services Company, Inc. (1997). Previously, Mr. Burkhead
served as President and a Director of FMR.
WILLIAM O. McCOY (63),Trustee (1997), is the Vice President of Finance for
the University of North Carolina (16-school system, 1995). Prior to his
retirement in December 1994, Mr. McCoy was Vice Chairman of the Board of
BellSouth Corporation (telecommunications, 1984) and President of BellSouth
Enterprises (1986). He is currently a Director of Liberty Corporation
(holding company, 1984), Weeks Corporation of Atlanta (real estate, 1994),
Carolina Power and Light Company (electric utility, 1996), and the Kenan
Transport Co. (1996). Previously, he was a Director of First American
Corporation (bank holding company, 1979-1996). In addition, Mr. McCoy
serves as a member of the Board of Visitors for the University of North
Carolina at Chapel Hill (1994) and for the Kenan-Flager Business School
(University of North Carolina at Chapel Hill, 1988). Mr. McCoy currently
serves as a Trustee for each of the following trusts: Fidelity Advisor
Series I, II, III, IV, V, VI, and VIII, Fidelity Municipal Trust,
and Fidelity Income Fund.
ROBERT LAWRENCE (44), is Vice President of TechnoQuant Growth, Emerging
Markets Income, High Yield, and Strategic Income (1997), and other funds
advised by FMR, and Senior Vice President (1993). Prior to joining FMR, Mr.
Lawrence was Managing Director of the High Yield Department for Citicorp
(1984-1991).
MARGARET L. EAGLE (47), is President of High Yield and Strategic Income
(1997), and an employee of FMR.
THE FOLLOWING INFORMATION SUPPLEMENTS THE INFORMATION FOUND IN THE
"TRUSTEES AND OFFICERS" SECTION BEGINNING ON PAGE 126:
ROBERT M. GATES (53), Trustee (1997), is a consultant, author, and lecturer
(1993). Mr. Gates was Director of the Central Intelligence Agency (CIA)
from 1991-1993. From 1989 to 1991, Mr. Gates served as Assistant to the
President of the United States and Deputy National Security Advisor. Mr.
Gates is currently a Trustee for the Forum For International Policy, a
Board Member for the Virginia Neurological Institute, and a Senior Advisor
of the Harvard Journal of World Affairs. In addition, Mr. Gates also serves
as a member of the corporate board for LucasVarity PLC (automotive
components and diesel engines), Charles Stark Draper Laboratory
(non-profit), NACCO Industries, Inc. (mining and manufacturing), and TRW
Inc. (original equipment and replacement products) Mr. Gates currently
serves as a Trustee for each of the following trusts: Fidelity Advisor
Serie s I, II, III, IV, V, VI, and VIII, Fidelity Municipal Trust,
and Fidelity Income Fund.
*ROBERT C. POZEN (51), Trustee and Vice President (1997), is
President and a Director of FMR (1997); and President and a Director of
FMR Texas Inc. (1997), Fidelity Management & Research (U.K.) Inc. (1997),
and Fidelity Management & Research (Far East) Inc. (1997). Previously, Mr.
Pozen served as General Counsel, Managing Director, and Senior Vice
President of FMR Corp. Mr. Pozen currently serves as a Trustee for the
following trusts: Fidelity Advisor Series I, I I, III, IV, V, VI,
VIII, Fidelity Municipal Trust, and Fidelity Income Fund.
RICHARD A. SPILLANE, JR. (46), is Vice President of Balanced, Equity
Income, Growth & Income, and Overseas (1997), and other funds advised by
FMR, and is a Senior Vice President of FMR (1997).
ABIGAIL JOHNSON (36), is Vice President of Equity Growth, Growth
Opportunities, Large Cap, Mid Cap, and Strategic Opportunities (1997), and
other funds advised by FMR, and is a director of FMR Corp. Previously she
managed a number of Fidelity funds.
DWIGHT CHURCHILL (43), is Vice President of Mortgage Securities, Government
Investment, Intermediate Bond, Short Fixed-Income, High Income Municipal,
Municipal Bond, Intermediate Municipal Income, Short-Intermediate Municipal
Income, California Municipal Income, and New York Municipal Income (1997),
and other funds advised by FMR. He joined Fidelity in 1993.
GEORGE A. FISCHER (36), is Vice President of High Income Municipal (1997)
and Municipal Bond (1997), and other funds advised by FMR, and an employee
of FMR.
JONATHAN D. SHORT (34), is Vice President of California Municipal Income
(1997), and other funds advised by FMR, and an employee of FMR.
THOMAS M. SPRAGUE (39), is Vice President of Large Cap (1997), and another
fund advised by FMR, and an employee of FMR.
EFFECTIVE OCTOBER 1, 1997, THE FOLLOWING INFORMATION REPLACES SIMILAR
INFORMATION FOUND IN THE "TRUSTEES AND OFFICERS" SECTION ON PAGE 127.
KEVIN E. GRANT (36), is Vice President of Balanced (1996) and Intermediate
Bond (1996), and other funds advised by FMR, and an employee of FMR.
THE FOLLOWING INFORMATION REPLACES THE BIOGRAPHICAL INFORMATION FOR KENNETH
A. RATHGEBER IN THE "TRUSTEES AND OFFICERS" SECTION ON PAGE 128:
RICHARD A. SILVER (50), Treasurer (1997), is Treasurer of the Fidelity
funds and is an employee of FMR (1997). Before joining FMR, Mr. Silver
served as Executive Vice President, Fund Accounting & Administration at
First Data Investor Services Group, Inc. (1996 - 1997). Prior to 1996,
Mr. Silver was Senior Vice President and Chief Financial Officer at The
Colonial Group, Inc. Mr. Silver also served as Chairman of the
Accounting/Treasurer's Committee of the Investment Company Institute
(1987 - 1993).
THE FOLLOWING FOOTNOTE REPLACES A SIMILAR FOOTNOTE FOUND IN THE "TRUSTEES
AND OFFICERS" SECTION ON PAGE 130.
(double dagger)(double dagger)(double dagger) During the period from May 1,
1996 through December 31, 1996, William O. McCoy served as a Member of the
Advisory Board of each trust. Mr. McCoy was appointed to the Board of
Trustees of Fidelity Advisor Series II, III, IV, V, and VI, Fidelity
Municipal Trust, and Fidelity Income Fund, effective January 1, 1997. Mr.
McCoy was elected to th e Board of Trustees of Fidelity Advisor Series I
and Fidelity Advisor Series VIII on August 4, 1997 and June 18, 1997,
respectivel y.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"TRUSTEES AND OFFICERS" SECTION ON PAGES 131-135.
As of May 31, 1997, approximately 44.14% of California Municipal Income's,
7.39% of Emerging Markets Income's, 4.05% of Large Cap's, and 28.67% of
Municipal Bond's, outstanding shares were held by an FMR affiliate. FMR
Corp. is the ultimate parent company of this FMR affiliate. By virtue of
his ownership interest in FMR Corp., as described in the "FMR" section on
page 125, Mr. Edward C. Johnson 3d, President and Trustee of the fund, may
be deemed to be a beneficial owner of these shares. As of the above date,
with the exception of Mr. Johnson 3d's deemed ownership of California
Municipal Income's, Emerging Markets Income's, Large Cap's, and Municipal
Bond's shares, the Trustees and officers of the funds owned, in the
aggregate, less than 1% of each fund's total outstanding shares.
As of May 31, 1997, the following owned of record or beneficially 5% or
more of the outstanding shares of the classes of the following Fidelity
Advisor funds:
ADVISOR BALANCED - CLASS A: EQ Financial Consultants, New York, NY
(10.99%); First Tennessee Bank, Memphis, TN (7.61%).
ADVISOR BALANCED - CLASS T: CIGNA, Hartford, CT (22.15%); Smith Barney, New
York, NY (5.24%).
ADVISOR BALANCED - CLASS B: Royal Alliance Assoc., Inc., Birmingham, AL
(5.92%).
ADVISOR BALANCED - INSTITUTIONAL CLASS: Whitney National Bank, New Orleans,
LA (33.07%); Valley National Bank, Clifton, NJ (14.31%); Charles Schwab and
Co., Inc., San Francisco, CA (9.38%); Moss Lawton, Chicago, IL (8.19%);
Benefit Services Corporation, Atlanta, GA (6.09%).
ADVISOR CALIFORNIA MUNICIPAL INCOME - CLASS A: FMR Corp., Boston, MA
(75.48%); Sunamerica Securities, Inc., Phoenix, AZ (24.52%).
ADVISOR CALIFORNIA MUNICIPAL INCOME - CLASS T: First Allied Securities,
Inc., Cokeville, WY (21.42%); Prudential Securities, New York, NY (15.83%);
Hornor Townsend & Kent, Philadelphia, PA (12.58%); W. S. Griffith & Co.,
Inc., San Diego, CA (5.48%).
ADVISOR CALIFORNIA MUNICIPAL INCOME - CLASS B: FMR Corp., Boston, MA
(13.02%); UBOC Investment Services, Inc., Los Angeles, CA (12.54%); U. S.
Life Equity Sales, New York, NY (12.11%); Prudential Securities, New York,
NY (9.08%); Merrill Lynch Pierce Fenner & Smith, Jacksonville, FL (7.51%);
Piper Jaffrey & Hopwood, Inc., Minneapolis, MN (7.34%); A. G. Edwards &
Sons, St. Louis, MO (6.67%); Alliance Advisory & Securities, Westlake
Village, CA (6.42%); PaineWebber, Inc., Weehawken, NJ (6.33%); Sunamerica
Securities, Inc., Phoenix, AZ (5.30%).
ADVISOR CALIFORNIA MUNICIPAL INCOME - INSTITUTIONAL CLASS: FMR Corp.,
Boston, MA (98.67%).
ADVISOR EMERGING MARKETS INCOME - CLASS A: FMR Corp., Boston, MA (11.67%);
Dain Bosworth, Inc., Minneapolis, MN (10.22%); PNC Securities, Pittsburgh,
PA (7.55%); Washington Square Securities, Minneapolis, MN (6.96%); Merrill
Lynch Pierce Fenner & Smith, Jacksonville, FL (5.43%).
ADVISOR EMERGING MARKETS INCOME - CLASS T: FMR Corp., Boston, MA (9.37%);
Donaldson, Lufkin & Jenrette, New York, NY (6.80%).
ADVISOR EMERGING MARKETS INCOME - CLASS B: Donaldson, Lufkin & Jenrette,
New York, NY (9.26%); PaineWebber, Inc., Weehawken, NJ (6.83%).
ADVISOR EMERGING MARKETS INCOME - INSTITUTIONAL CLASS: Robert E. Jones &
Associates, Denver, CO (59.98%); First National Bank La Jolla, La Jolla, CA
(7.36%).
ADVISOR EQUITY GROWTH - CLASS A: FIS Securities, Inc., Providence, RI
(9.60%); Donaldson, Lufkin & Jenrette, New York, NY (6.68%).
ADVISOR EQUITY GROWTH - CLASS T: CIGNA, Hartford, CT (8.88%); Smith Barney,
New York, NY (5.61%); Merrill Lynch Pierce Fenner & Smith, Jacksonville, FL
(5.33%).
ADVISOR EQUITY GROWTH - CLASS B: FIS Securities, Inc., Providence, RI
(11.76%).
ADVISOR EQUITY INCOME - CLASS A: Donaldson, Lufkin & Jenrette, New York, NY
(8.16%); FIS Securities, Inc., Providence, RI (6.04%).
ADVISOR EQUITY INCOME - CLASS T: Smith Barney, New York, NY (5.33%).
ADVISOR EQUITY INCOME - CLASS B: Merrill Lynch Pierce Fenner & Smith,
Jacksonville, FL (7.26%); Smith Barney, New York, NY (7.18%); Donaldson,
Lufkin & Jenrette, New York, NY (6.61%).
ADVISOR EQUITY INCOME - INSTITUTIONAL CLASS: Bank of Boston, Boston, MA
(29.73%); First National Bank of Ohio, Akron, OH (13.12%); First Hawaiian
Bank, Honolulu, HI (5.82%).
ADVISOR GOVERNMENT INVESTMENT - CLASS A: FMR Corp., Boston, MA (15.00%);
Wilmington Trust Company, Wilmington, DE (12.68%); CJM Planning Corp., Fair
Lawn, NJ (10.68%); A. G. Edwards & Sons, St. Louis, MO (9.08%); Vestax
Securities, Hudson, OH (9.00%); UBOC Investment Services, Inc., Los
Angeles, CA (7.28%); EQ Financial Consultants, New York, NY (6.92%).
ADVISOR GOVERNMENT INVESTMENT - CLASS T: Oriental Financial Services Corp.,
Hato Rey, PR (6.54%); Commonwealth Equity Services, Waltham, MA (6.28%);
Smith Barney, New York, NY (5.02%).
ADVISOR GOVERNMENT INVESTMENT - CLASS B: Donaldson, Lufkin & Jenrette, New
York, NY (7.52%); Royal Alliance Assoc., Inc., Birmingham, AL (6.29%);
Smith Barney, New York, NY (5.31%).
ADVISOR GOVERNMENT INVESTMENT - INSTITUTIONAL CLASS: First Hawaiian Bank,
Honolulu, HI (63.05%); First Security Trust Company, Coral Gables, FL
(6.02%).
ADVISOR GROWTH OPPORTUNITIES - CLASS A: Donaldson, Lufkin & Jenrette, New
York, NY (6.28%); Prudential Securities, New York, NY (6.04%); A. G.
Edwards & Sons, St. Louis, MO (5.09%).
ADVISOR GROWTH OPPORTUNITIES - CLASS T: CIGNA, Hartford, CT (16.42%); Smith
Barney, New York, NY (6.72%).
ADVISOR GROWTH OPPORTUNITIES - CLASS B: Merrill Lynch Pierce Fenner &
Smith, Jacksonville, FL (9.76%); A. G. Edwards & Sons, St.
Louis, MO (6.83%); Smith Barney, New York, NY (6.46%); Prudential
Securities, New York, NY (5.54%).
ADVISOR GROWTH OPPORTUNITIES - INSTITUTIONAL CLASS: Frost National Bank,
San Antonio, TX (9.55%); Charles Schwab and Co., Inc., San Francisco, CA
(9.54%); Marshall & Ilsley Trust Co., Milwaukee, WI (7.31%).
ADVISOR HIGH INCOME MUNICIPAL - CLASS A: Dain Bosworth, Inc., Minneapolis,
MN (29.02%); A. G. Edwards & Sons, St. Louis, MO (19.28%); 1717 Capital
Management Company, Newark, DE (15.87%); FMR Corp., Boston, MA (6.18%); EQ
Financial Consultants, New York, NY (5.75%); Corelink Financial,
Providence, RI (5.47%).
ADVISOR HIGH INCOME MUNICIPAL - CLASS T: Smith Barney, New York, NY
(8.75%); A. G. Edwards & Sons, St. Louis, MO (6.86%); Royal Alliance
Assoc., Inc., Birmingham, AL (5.26%); Donaldson, Lufkin & Jenrette, New
York, NY (5.09%).
ADVISOR HIGH INCOME MUNICIPAL - CLASS B: Donaldson, Lufkin & Jenrette, New
York, NY (10.32%); Merrill Lynch Pierce Fenner & Smith, Jacksonville, FL
(5.26%).
ADVISOR HIGH INCOME MUNICIPAL - INSTITUTIONAL CLASS: Tompkins County Trust
Company, Ithaca, NY (19.03%); FMR Corp., Boston, MA (12.49%); Charles
Schwab and Co., Inc., San Francisco, CA (6.58%); Liberty National Bank &
Trust, Oklahoma City, OK (6.40%); Jack White & Company - TX, Beaumont, TX
(5.55%); Evergreen Bank, N.A., Glens Falls, NY (5.55%); University Bank,
Houston, TX (5.26%).
ADVISOR HIGH YIELD - CLASS A: FIS Securities, Providence, RI (13.09%);
Donaldson, Lufkin & Jenrette, New York, NY (8.22%).
ADVISOR HIGH YIELD - CLASS T: Donaldson, Lufkin & Jenrette, New York, NY
(9.06%); Smith Barney, New York, NY (6.17%); Manulife Financial, Canada
(5.94%).
ADVISOR HIGH YIELD - CLASS B: Merrill Lynch Pierce Fenner & Smith,
Jacksonville, FL (10.58%); Donaldson, Lufkin & Jenrette, New York, NY
(8.20%); Prudential Securities, New York, NY (6.79%); Smith Barney, New
York, NY (5.98%).
ADVISOR HIGH YIELD - INSTITUTIONAL CLASS: Charles Schwab and Co., Inc., San
Francisco, CA (18.03%); Donaldson, Lufkin & Jenrette, New York, NY
(10.12%); Resources Trust Company, Englewood, CO (7.56%); First Hawaiian
Bank, Honolulu, HI (6.49%); Capital Planning Corp., Bellevue, WA (5.08%).
ADVISOR INTERMEDIATE BOND - CLASS A: FIS Securities, Inc., Providence, RI
(30.64%); Corelink Financial, Providence, RI (13.33%); Donaldson, Lufkin &
Jenrette, New York, NY (9.26%); FMR Corp., Boston, MA (5.80%); Prudential
Securities, New York, NY (5.58%).
ADVISOR INTERMEDIATE BOND - CLASS T: PaineWebber, Inc., Weehawken, NJ
(8.22%).
ADVISOR INTERMEDIATE BOND - CLASS B: Donaldson, Lufkin & Jenrette, New
York, NY (11.67%); Royal Alliance Assoc., Inc., Birmingham, AL (6.19%).
ADVISOR INTERMEDIATE BOND - INSTITUTIONAL CLASS: Mercantile Bank, N.A., St.
Louis, MO (12.75%); Amivest Corporation, New York, NY (6.41%); Magna Trust
Company, Belleville, IL (6.23%); Bank of Mississippi, Jackson, MS (5.75%).
ADVISOR INTERMEDIATE MUNICIPAL INCOME - CLASS A: FMR Corp., Boston, MA
(30.39%); Summit Trust Company, Summit, NJ (27.86%); Locust Street
Securities, Inc., Des Moines, IA (22.90%); Corelink Financial, Providence,
RI (13.65%).
ADVISOR INTERMEDIATE MUNICIPAL INCOME - CLASS T: Royal Alliance Assoc.,
Inc., Birmingham, AL (8.75%); Smith Barney, New York, NY (6.98%);
Commonwealth Equity Services, Waltham, MA (5.44%).
ADVISOR INTERMEDIATE MUNICIPAL INCOME - CLASS B: Merrill Lynch Pierce
Fenner & Smith, Jacksonville, FL (12.04%); National Financial Services
Corporation, Boston, MA (7.61%); Prudential Securities, New York, NY
(7.07%); Donaldson, Lufkin & Jenrette, New York, NY (6.93%); Royal Alliance
Assoc., Inc., Birmingham, AL (6.35%); A. G. Edwards & Sons, St. Louis, MO
(6.08%).
ADVISOR INTERMEDIATE MUNICIPAL INCOME - INSTITUTIONAL CLASS: Liberty
National Bank & Trust, Oklahoma City, OK (24.47%); Wells Fargo Bank, San
Francisco, CA (12.90%); Frost National Bank, San Antonio, TX (10.88%);
South Holland Bancorp, South Holland, IL (8.94%); Citizens National Bank of
Evansville, Evansville, IN (6.20%); Laird Norton Co., Seattle, WA (5.71%).
ADVISOR LARGE CAP - CLASS A: A. G. Edwards & Sons, St. Louis, MO (12.19%);
FMR Corp., Boston, MA (7.63%); Westport Bank and Trust Co., Westport, CT
(6.24%); LaSalle St. Securities, Inc., Chicago, IL (6.03%); 1717 Capital
Management Company, Newark, DE (5.62%).
ADVISOR LARGE CAP - CLASS T: Dain Bosworth, Inc., Minneapolis, MN (8.07%);
Securities America, Inc., Omaha, NE (7.86%).
ADVISOR LARGE CAP -CLASS B: Dain Bosworth, Inc., Minneapolis, MN (20.70%);
Prudential Securities, New York, NY (7.53%).
ADVISOR LARGE CAP - INSTITUTIONAL CLASS: FMR Corp., Boston, MA (39.94%);
Charles Schwab and Co., Inc., San Francisco, CA (21.21%); Union Planters
National Bank, Memphis, TN (13.71%); First Hawaiian Bank, Honolulu, HI
(8.16%).
ADVISOR MID CAP - CLASS A: PaineWebber, Inc., Weehawken, NJ (7.88%); Smith
Barney, New York, NY (6.50%); A. G. Edwards & Sons, St. Louis, MO (6.15%);
First Tennessee Bank, Memphis, TN (5.38%).
ADVISOR MID CAP - CLASS T: Commonwealth Equity Services, Waltham, MA
(8.26%); Dain Bosworth, Inc., Minneapolis, MN (7.29%); Smith Barney, New
York, NY (6.22%); Donaldson, Lufkin & Jenrette, New York, NY (5.64%).
ADVISOR MID CAP - CLASS B: Dain Bosworth, Inc., Minneapolis, MN (15.26%);
Merrill Lynch Pierce Fenner & Smith, Jacksonville, FL (8.41%); Smith
Barney, New York, NY (7.59%).
ADVISOR MID CAP - INSTITUTIONAL CLASS: First Hawaiian Bank, Honolulu, HI
(71.21%).
ADVISOR MORTGAGE SECURITIES - CLASS A: CIGNA, Hartford, CT (92.82%); FMR
Corp., Boston, MA (6.63%).
ADVISOR MORTGAGE SECURITIES - CLASS T: Sunamerica Securities, Inc.,
Phoenix, AZ (54.91%); FMR Corp., Boston, MA (14.47%); Donaldson, Lufkin &
Jenrette, New York, NY (9.46%).
ADVISOR MORTGAGE SECURITIES - CLASS B: 1717 Capital Management Company,
Newark, DE (42.51%); FMR Corp., Boston, MA (20.26%); Washington Square
Securities, Minneapolis, MN (20.10%).
ADVISOR MORTGAGE SECURITIES - INSTITUTIONAL CLASS: FMR Corp., Boston, MA
(11.29%).
ADVISOR MORTGAGE SECURITIES - INITIAL CLASS: National Financial Services
Corporation, Boston, MA (13.26%).
ADVISOR MUNICIPAL BOND - CLASS A: Sigma Financial Corp., Ann Arbor, MI
(70.92%); FMR Corp., Boston, MA (19.97%); PaineWebber, Inc., Weehawken, NJ
(6.97%).
ADVISOR MUNICIPAL BOND - CLASS T: 1717 Capital Management Company, Newark,
DE (17.82%); FSC Securities Corp., Atlanta, GA (15.26%); Jefferson Pilot
Investor Services, Greensboro, NC (11.52%); A. G. Edwards & Sons, St.
Louis, MO (8.96%); Donaldson, Lufkin & Jenrette, New York, NY (8.35%);
Lovell, Inc., Brentwood, TN (6.92%); KMS Financial Services, Inc., Seattle,
WA (5.31%).
ADVISOR MUNICIPAL BOND - CLASS B: Prudential Securities, New York, NY
(20.58%); FMR Corp., Boston, MA (11.79%); Dain Bosworth, Inc., Minneapolis,
MN (11.64%); Investment Advisors & Consultants, Inc., Ocean, NJ (9.21%);
Bank One, N.A., Columbus, OH (6.12%); John Hancock Distributors, Boston, MA
(5.85%); Associated Investments Services, Inc., Portage, WI (5.64%).
ADVISOR MUNICIPAL BOND - INSTITUTIONAL CLASS: Drovers Bank, York, PA
(46.61%); Peoples Bank and Trust Co., Indianapolis, IN (26.40%); Premier
Bank and Trust, Elyria, OH (11.26%); FMR Corp., Boston, MA (8.23%).
ADVISOR NEW YORK MUNICIPAL INCOME - CLASS A: FMR Corp., Boston, MA
(51.55%); PaineWebber, Inc., Weehawken, NJ (37.35%); A. G. Edwards & Sons,
St. Louis, MO (6.40%).
ADVISOR NEW YORK MUNICIPAL INCOME - CLASS T: FMR Corp., Boston, MA
(18.55%); A. G. Edwards & Sons, St. Louis, MO (11.27%); North Ridge
Securities Corp., Hauppauge, NY (10.71%); First Albany, Albany, NY (7.03%);
HRC Services, Inc., Glenwood Landing, NY (5.46%).
ADVISOR NEW YORK MUNICIPAL INCOME - CLASS B: FMR Corp., Boston, MA
(23.60%); Chase Investment Services, New York, NY (16.26%); National
Financial Services Corporation, Boston, MA (16.21%); Prudential Securities,
New York, NY (11.11%); Merrill Lynch Pierce Fenner & Smith, Jacksonville,
FL (5.24%).
ADVISOR NEW YORK MUNICIPAL INCOME - INSTITUTIONAL CLASS: FMR Corp., Boston,
MA (100.00%).
ADVISOR OVERSEAS - CLASS A: EQ Financial Consultants, New York, NY (9.19%);
Chase Investment Services, New York, NY (6.50%); PaineWebber, Inc.,
Weehawken, NJ (6.06%).
ADVISOR OVERSEAS - CLASS T: Great West Life/Benefits Corp., Englewood, CO
(7.56%); Smith Barney, New York, NY (7.22%).
ADVISOR OVERSEAS - CLASS B: Royal Alliance Assoc., Inc., Birmingham, AL
(6.60%); PaineWebber, Inc., Weehawken, NJ (6.57%); Smith Barney, New York,
NY (6.54%); Merrill Lynch Pierce Fenner & Smith, Jacksonville, FL (5.71%).
ADVISOR OVERSEAS - INSTITUTIONAL CLASS: First National Bank, Iowa City, IA
(24.65%); Bingham, Dana & Gould L.L.P., Boston, MA (13.34%); First Hawaiian
Bank, Honolulu, HI (9.37%); One Valley Bank, N.A., Charleston, WV (5.98%).
ADVISOR SHORT FIXED-INCOME - CLASS A: A. G. Edwards & Sons, St. Louis, MO
(19.35%); FMR Corp., Boston, MA (13.04%); Corelink Financial, Providence,
RI (6.12%); Harbour Investments, Inc., Madison, WI (6.04%); Terra
Securities Corp., Oak Brook, IL (5.90%).
ADVISOR SHORT FIXED-INCOME - CLASS T: Smith Barney, New York, NY (6.37%);
Royal Alliance Assoc., Inc., Birmingham, AL (5.55%).
ADVISOR SHORT FIXED-INCOME - INSTITUTIONAL CLASS: First Hawaiian Bank,
Honolulu, HI (57.10%); First National Bank of Springfield, Springfield, IL
(17.54%); Benefit Services Corporation, Atlanta, GA (12.45%).
ADVISOR SHORT-INTERMEDIATE MUNICIPAL INCOME - CLASS A: FMR Corp., Boston,
MA (51.72%); Investment Advisors & Consultants, Inc., Ocean, NJ (16.09%);
Chase Manhattan Bank, N.A., Rochester, NY (5.97%).
ADVISOR SHORT-INTERMEDIATE MUNICIPAL INCOME - CLASS T: Key/Society Corp.,
Cleveland, OH (17.63%); Cowles, Sabol & Co., Inc., Encino, CA (8.43%).
ADVISOR SHORT-INTERMEDIATE MUNICIPAL INCOME - INSTITUTIONAL CLASS:
University Bank, Houston, TX (22.34%); FMR Corp., Boston, MA (21.84%);
First American Bank & Trust, Fort Atkinson, WI (19.58%); Peoples Bank and
Trust Co., Indianapolis, IN (12.83%); Drovers Bank, York, PA (11.06%).
ADVISOR STRATEGIC INCOME - CLASS A: FIS Securities, Inc., Providence, RI
(33.50%); FMR Corp., Boston, MA (7.83%); Terra Securities Corp., Oak Brook,
IL (7.10%); PaineWebber, Inc., Weehawken, NJ (5.05%).
ADVISOR STRATEGIC INCOME - CLASS T: Royal Alliance Assoc., Inc.,
Birmingham, AL (7.76%); Donaldson Lufkin & Jenrette, New York, NY (7.35%);
Financial Network Investment Corp., Torrance, CA (5.08%).
ADVISOR STRATEGIC INCOME - CLASS B: G W & Wade Asset Management Co.,
Wellesley, MA (33.18%); FIS Securities, Inc., Providence, RI (6.02%).
ADVISOR STRATEGIC INCOME - INSTITUTIONAL CLASS: Charles Schwab and Co.,
Inc., San Francisco, CA (88.97%); Bingham, Dana & Gould L.L.P., Boston, MA
(5.04%).
ADVISOR STRATEGIC OPPORTUNITIES - CLASS A: FMR Corp., Boston, MA (14.26%);
A. G. Edwards & Sons, St. Louis, MO (12.69%); Stephens, Inc., Little Rock,
AR (5.42%).
ADVISOR STRATEGIC OPPORTUNITIES - CLASS T: Merrill Lynch Pierce Fenner &
Smith, Jacksonville, FL (12.63%); CIGNA, Hartford, CT (10.43%); A. G.
Edwards & Sons, St. Louis, MO (6.42%); Smith Barney, New York, NY (5.09%).
ADVISOR STRATEGIC OPPORTUNITIES - CLASS B: Donaldson, Lufkin & Jenrette,
New York, NY (6.38%); Smith Barney, New York, NY (6.37%).
ADVISOR STRATEGIC OPPORTUNITIES - INSTITUTIONAL CLASS: National Bank of
Alaska, Anchorage, AK (18.50%); Evergreen Bank, N.A., Glens Falls, NY
(15.96%); Whitney National Bank, New Orleans, LA (11.31%); Equitable Trust
Company, Nashville, TN (10.21%); First Tennessee Bank, Memphis, TN
(10.12%); Thumb National Bank and Trust, Pigeon, MI (6.13%); Commonwealth
Equity Services, Waltham, MA (5.60%).
A shareholder owning of record or beneficially more than 25% of a fund's
outstanding shares may be considered a controlling person. That
shareholder's vote could have a more significant effect on matters
presented at a shareholders' meeting than votes of other shareholders.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"MANAGEMENT CONTRACT" SECTION ON PAGE 136.
FMR is each fund's manager pursuant to management contracts dated and
approved by shareholders on the dates shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C>
FUND DATE OF MANAGEMENT CONTRACT DATE OF SHAREHOLDER APPROVAL
TechnoQuant Growth 12/1/96 12/23/96*
Overseas 1/1/93 12/1/92
Mid Cap 1/18/96 1/18/96*
Equity Growth 9/1/97 8/4/97
Growth Opportunities 8/1/97 7/16/97
Strategic Opportunities 7/1/97 6/18/97
Large Cap 1/18/96 1/18/96*
Growth & Income 12/1/96 12/23/96*
Equity Income 8/1/86 7/23/86
Balanced 1/1/95 12/14/94
Emerging Markets Income 7/1/97 6/18/97
High Yield 1/1/95 12/14/94
Strategic Income 7/1/97 6/18/97
Mortgage Securities 8/1/94 7/13/94
Government Investment 1/1/95 12/14/94
Intermediate Bond 1/1/95 12/14/94
Short Fixed-Income 1/1/95 12/14/94
High Income Municipal 12/1/94 11/16/94
Municipal Bond 1/1/94 12/15/93
Intermediate Municipal Income 7/1/95 6/14/95
Short-Intermediate Municipal Income 7/1/95 6/14/95
New York Municipal Income 11/17/94 12/8/94
California Municipal Income 12/14/95 12/14/95*
</TABLE>
* Approved by FMR, then the sole shareholder of the fund.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"MANAGEMENT CONTRACT" ON PAGE 139.
CALIFORNIA MUNICIPAL INCOME, STRATEGIC INCOME, AND EMERGING MARKETS INCOME.
The following fee schedule is the current fee schedule for California
Municipal Income, Strategic Income, and Emerging Markets Income.
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Annualized Group Net Effective Annual
Assets Rate Assets Fee Rate
$ 0 - $3 billion .3700% $ 0.5 billion .3700%
3 - 6 .3400 25 .2664
6 - 9 .3100 50 .2188
9 - 12 .2800 75 .1986
12 - 15 .2500 100 .1869
15 - 18 .2200 125 .1793
18 - 21 .2000 150 .1736
21 - 24 .1900 175 .1690
24 - 30 .1800 200 .1652
30 - 36 .1750 225 .1618
36 - 42 .1700 250 .1587
42 - 48 .1650 275 .1560
48 - 66 .1600 300 .1536
66 - 84 .1550 325 .1514
84 - 120 .1500 350 .1494
120 - 156 .1450 375 .1476
156 - 192 .1400 400 .1459
192 - 228 .1350 425 .1443
228 - 264 .1300 450 .1427
264 - 300 .1275 475 .1413
300 - 336 .1250 500 .1399
336 - 372 .1225 525 .1385
372 - 408 .1200 550 .1372
408 - 444 .1175
444 - 480 .1150
480 - 516 .1125
Over 516 .1100
This fee schedule has been approved by the shareholders of California
Municipal Income, Strategic Income, and Emerging Markets Income.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"MANAGEMENT CONTRACT" BEGINNING ON PAGE 144.
TECHNOQUANT GROWTH, MID CAP, LARGE CAP, GROWTH & INCOME, STRATEGIC
OPPORTUNITIES, GROWTH OPPORTUNITIES, AND EQUITY GROWTH. The following
fee schedule is the current fee schedule for TechnoQuant Growth, Mid Cap,
Large Cap, Growth & Income, Strategic Opportunities, Growth Opportunities,
and Equity Growth.
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Annualized Group Net Effective Annual
Assets Rate Assets Fee Rate
$ 0 - 3 billion .5200% $ 0.5 billion .5200%
3 - 6 .4900 25 .4238
6 - 9 .4600 50 .3823
9 - 12 .4300 75 .3626
12 - 15 .4000 100 .3512
15 - 18 .3850 125 .3430
18 - 21 .3700 150 .3371
21 - 24 .3600 175 .3325
24 - 30 .3500 200 .3284
30 - 36 .3450 225 .3249
36 - 42 .3400 250 .3219
42 - 48 .3350 275 .3190
48 - 66 .3250 300 .3163
66 - 84 .3200 325 .3137
84 - 102 .3150 350 .3113
102 - 138 .3100 375 .3090
138 - 174 .3050 400 .3067
174 - 210 .3000 425 .3046
210 - 246 .2950 450 .3024
246 - 282 .2900 475 .3003
282 - 318 .2850 500 .2982
318 - 354 .2800 525 .2962
354 - 390 .2750 550 .2942
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over 534 .2500
This fee schedule has been approved by shareholders of each of
TechnoQuant Growth, Mid Cap, Large Cap, Growth & Income, Strategic
Opportunities, Growth Opportunities, and Equity Growth.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"COMPUTING THE PERFORMANCE ADJUSTMENT" SECTION ON PAGE 145.
COMPUTING THE PERFORMANCE ADJUSTMENT. The basic fee for Overseas, Growth
Opportunities, and Strategic Opportunities is subject to upward or downward
adjustment, depending upon whether, and to what extent, the investment
performance of each applicable fund for the performance period exceeds, or
is exceeded by, the record of the S&P 500 (Growth Opportunities and
Strategic Opportunities), or the cap-weighted EAFE (Overseas) (the Indices)
over the same period. The performance period consists of the most recent
month plus the previous 35 months. Each percentage point of difference,
calculated to the nearest 1.0% for and Overseas, and 0.01% for Growth
Opportunities and Strategic Opportunities (up to a maximum difference of
(plus/minus)10.00) is multiplied by a performance adjustment rate of 0.02%.
Thus, the maximum annualized adjustment rate is (plus/minus)0.20%. This
performance comparison is made at the end of each month. One-twelfth of
this rate is then applied to each fund's average net assets for the entire
performance period, giving the dollar amount which will be added to (or
subtracted from) the basic fee. For Overseas, investment performance will
be measured separately for each class of shares offered by that fund and
the least of the results obtained will be used in calculating the
performance adjustment to the management fee paid by the fund. For Growth
Opportunities and Strategic Opportunities, investment performance will be
represented by the average performance of all classes of each fund weighted
according to its average assets for each month.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"SUB-ADVISERS" SECTION ON PAGE 148.
On behalf of TechnoQuant Growth, Overseas, Mid Cap, Equity Growth, Growth
Opportunities, Strategic Opportunities, Large Cap, Growth & Income,
Balanced, Emerging Markets Income, High Yield, Strategic Income,
Intermediate Bond, Mortgage Securities, and Short Fixed-Income, FMR may
also grant FMR U.K. and FMR Far East investment management authority as
well as the authority to buy and sell securities if FMR believes it would
be beneficial to the funds.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE
"DISTRIBUTION AND SERVICE PLANS" SECTION BEGINNING ON PAGE 152.
Pursuant to the Class A Plans, FDC is paid a distribution fee as a
percentage of Class A's average net assets at an annual rate of up to 0.75%
for each of TechnoQuant Growth, Overseas, Mid Cap, Equity Growth, Growth
Opportunities, Strategic Opportunities, Large Cap, Growth & Income, Equity
Income, and Balanced (the Equity Funds); and up to 0.40% for each of
Emerging Markets Income, High Yield, Strategic Income, Government
Investment, Mortgage Securities, High Income Municipal, Municipal Bond, New
York Municipal Income, and California Municipal Income (the Bond Funds),
Intermediate Bond and Intermediate Municipal Income (the Intermediate-Term
Bond Funds), and Short-Intermediate Municipal Income and Short Fixed-Income
(the Short-Term Bond Funds). Pursuant to the Class T Plans, FDC is paid a
distribution fee as a percentage of Class T's average net assets at an
annual rate of up to 0.75% for each of TechnoQuant Growth, Equity Growth,
Mid Cap, Large Cap, Growth & Income, and Equity Income; up to 0.65% for
each of Overseas, Growth Opportunities, Strategic Opportunities, and
Balanced; up to 0.40% for each of Emerging Markets Income, High Yield,
Strategic Income, Intermediate Bond, Mortgage Securities, Government
Investment, High Income Municipal, Municipal Bond, Short-Intermediate
Municipal Income, Intermediate Municipal Income, New York Municipal Income,
and California Municipal Income; and up to 0.15% for Short Fixed-Income.
Pursuant to the Class B Plans, FDC is paid a distribution fee as a
percentage of Class B's average net assets at an annual rate of up to 0.75%
for each fund with Class B shares. For the purpose of calculating the
distribution fees, average net assets are determined at the close of
business on each day throughout the month, but excluding assets
attributable to Class T shares o f Equity Income and Ov erseas
purchased more than 144 months prior to such day and to Class B shares of
Equity Income purchased more than 144 months prior to such day. Currently,
the Trustees have approved a distribution fee for Class A at an annual rate
of 0.25% for each of the Equity Funds and 0.15% for each of the Bond Funds,
the Intermediate-Term Bond Funds, and the Short-Term Bond Funds. Currently,
the Trustees have approved a distribution fee for Class T at an annual rate
of 0.50% for each of the Equity Funds; 0.25% for each of the Bond Funds and
the Intermediate-Term Bond Funds; and 0.15% for each of the Short-Term Bond
Funds. Currently, the Trustees have approved a distribution fee for Class B
at an annual rate of 0.75% for each of the Equity Funds and 0.65% for each
of the Bond Funds and the Intermediate-Term Bond Funds. These fee rates may
be increased only when, in the opinion of the Trustees, it is in the best
interests of the shareholders of the applicable class to do so. Class B of
each fund also pays investment professionals a service fee at an annual
rate of 0.25% of its average daily net assets determined at the close of
business on each day throughout the month for personal service and/or the
maintenance of shareholder accounts.
THE FOLLOWING INFORMATION REPLACES SIMILAR INFORMATION FOUND IN THE "VOTING
RIGHTS" SECTION ON PAGE 159.
VOTING RIGHTS. Each fund's capital consists of shares of beneficial
interest. The shares have no preemptive rights, and Class A, Class T,
Institutional Class, and Initial Class shares have no conversion rights;
the voting and dividend rights, the conversion rights of Class B shares,
the right of redemption, and the privilege of exchange are described in the
Prospectus. Shareholders of TechnoQuant Growth, Mid Cap, Equity Growth,
Growth Opportunities, Strategic Opportunities, Large Cap, Growth & Income,
Equity Income, Emerging Markets Income, Balanced, High Yield, Strategic
Income, Mortgage Securities, Government Investment, Intermediate Bond,
Short Fixed-Income, High Income Municipal, Municipal Bond, Intermediate
Municipal Income, Short-Intermediate Municipal Income, New York Municipal
Income, and California Municipal Income receive one vote for each dollar of
net asset value owned. Shares are fully paid and nonassessable, except as
set forth under the heading "Shareholder and Trustee Liability" above.
Shareholders representing 10% or more of a trust, a fund, or class of a
fund may, as set forth in the Declaration of Trust, call meetings of the
trust, fund or class, as applicable, for any purpose related to the trust,
fund, or class, as the case may be, including, in the case of a meeting of
an entire trust, the purpose of voting on removal of one or more Trustees.
Each trust or fund may be terminated upon the sale of its assets to another
open-end management investment company, or upon liquidation and
distribution of its assets, if approved by vote of the holders of a
majority of the outstanding shares of the funds of Fidelity Advisor Series
I and VII, or as determined by the current value of each shareholder's
investment in the funds of Fidelity Advisor Series II, III, IV, V, VI, and
VIII, Fidelity Municipal Trust, and Fidelity Income Fund. If not so
terminated, each trust and fund will continue indefinitely. Growth
Opportunities, Strategic Opportunities, Balanced, Emerging Markets Income,
High Yield, Strategic Income, Government Investment, Intermediate Bond,
Short Fixed-Income, High Income Municipal, California Municipal Income, New
York Municipal Income, Mid Cap, Large Cap, Mortgage Securities, TechnoQuant
Growth, Growth & Income, Intermediate Municipal Income, Short-Intermediate
Municipal Income, and Equity Growth may invest all of their assets in
another investment company.
