FIDELITY ADVISOR SERIES I, N-30D, 1999-07-27

FIDELITY ADVISOR SERIES I
N-30D, 1999-07-27

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(2_FIDELITY_LOGOS)(registered trademark)

FIDELITY ADVISOR
ASSET ALLOCATION
FUND - CLASS A, CLASS T, CLASS B AND CLASS C

SEMIANNUAL REPORT
MAY 31, 1999

CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.

PERFORMANCE 4 How the fund has done over
time.

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

INVESTMENT SUMMARY 11 A summary of the fund's
investments.

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

FINANCIAL STATEMENTS 25 Statements of assets and
liabilities, operations, and
changes in net assets, as
well as financial highlights.

NOTES 34 Notes to the financial
statements.

Standard & Poor's, S&P and S&P 500 are registered service marks of The
McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity
Distributors Corporation.

Other third party marks appearing herein are the property of their
respective owners.

All other marks appearing herein are registered or unregistered
trademarks or service marks of FMR Corp. or an affiliated company.

This report is printed on recycled paper using soy-based inks.

THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL INFORMATION
OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS
IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY ADVISOR FUND, INCLUDING CHARGES
AND EXPENSES, CONTACT YOUR
INVESTMENT PROFESSIONAL FOR A FREE PROSPECTUS. READ IT CAREFULLY
BEFORE YOU INVEST OR SEND MONEY.

PRESIDENT'S MESSAGE

(photo_of_Edward_C_Johnson_3d)

DEAR SHAREHOLDER:

After its first-ever close above 11,000 on the first trading day of
May, the Dow Jones Industrial Average dropped over 450 points by
month's end. The Federal Reserve Board's shift in bias toward raising
rates to ward off inflation contributed to the decline. Government
securities followed a similar path during May, as expectations of an
eventual boost in interest rates drove the price of the bellwether
30-year Treasury consistently downwards.

While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.

First, investors are encouraged to take a long-term view of their
portfolios. If you can afford to leave your money invested through the
inevitable up and down cycles of the financial markets, you will
greatly reduce your vulnerability to any single decline. We know from
experience, for example, that stock prices have gone up over longer
periods of time, have significantly outperformed other types of
investments and have stayed ahead of inflation.

Second, you can further manage your investing risk through
diversification. The Advisor Asset Allocation Fund is already
diversified because it invests in stocks, bonds and short-term and
money market instruments, both in the U.S. and overseas. If you have a
short investment time horizon, you might want to consider moving some
of your investment into a money market fund, which seeks income and a
stable share price by investing in high-quality, short-term
investments. Of course, it's important to remember that an investment
in a money market fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although
money market funds seek to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in these
types of funds.

Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases. Of course, you should
consider your financial ability to continue your purchases through
periods of low price levels before undertaking such a strategy.

Remember to contact your investment professional if you need help with
your investments.

Best regards,
Edward C. Johnson 3d

FIDELITY ADVISOR ASSET ALLOCATION FUND - CLASS A
PERFORMANCE: THE BOTTOM LINE

CUMULATIVE TOTAL RETURNS

PERIOD ENDED MAY 31, 1999 LIFE OF FUND

FIDELITY ADV ASSET ALLOCATION 3.70%
- - CL A

FIDELITY ADV ASSET ALLOCATION -2.26%
- - CL A (INCL. 5.75% SALES
CHARGE)

Fidelity Aggressive Composite 4.73%

S&P 500(registered trademark) 6.81%

LB Aggregate Bond -0.52%

LB 3 Month T-Bill 1.92%

CUMULATIVE TOTAL RETURNS show Class A's performance in percentage
terms over a set period - in this case, since the fund started on
December 28, 1998. For example, if you had invested $1,000 in a fund
that had a 5% return over the past year, the value of your investment
would be $1,050. You can compare Class A's returns to the performance
of the Fidelity Aggressive Asset Allocation Composite Index, a
hypothetical combination of unmanaged indices. The composite index
combines the total returns of the Standard & Poor's 500 Index, the
Lehman Brothers Aggregate Bond Index and the Lehman Brothers 3 Month
Treasury Bill Index, weighted according to the fund's neutral mix *.
The benchmarks listed in the table above include reinvested dividends
and capital gains, if any, and exclude the effect of sales charges.

AVERAGE ANNUAL TOTAL RETURNS

AVERAGE ANNUAL TOTAL RETURNS take Class A shares' cumulative return
and show you what would have happened if Class A shares had performed
at a constant rate each year. These numbers will be reported once the
fund is a year old. In addition, the growth of a hypothetical $10,000
investment in the fund will appear in the fund's next report six
months from now.

* CURRENTLY 70% STOCKS, 25% BONDS AND 5% SHORT-TERM/MONEY MARKET
INSTRUMENTS.

FIDELITY ADVISOR ASSET ALLOCATION FUND - CLASS T
PERFORMANCE: THE BOTTOM LINE

CUMULATIVE TOTAL RETURNS

PERIOD ENDED MAY 31, 1999 LIFE OF FUND

FIDELITY ADV ASSET ALLOCATION 3.70%
- - CL T

FIDELITY ADV ASSET ALLOCATION 0.07%
- - CL T (INCL. 3.50% SALES
CHARGE)

Fidelity Aggressive Composite 4.73%

S&P 500 6.81%

LB Aggregate Bond -0.52%

LB 3 Month T-Bill 1.92%

CUMULATIVE TOTAL RETURNS show Class T's performance in percentage
terms over a set period - in this case, since the fund started on
December 28, 1998. For example, if you had invested $1,000 in a fund
that had a 5% return over the past year, the value of your investment
would be $1,050. You can compare Class T's returns to the performance
of the Fidelity Aggressive Asset Allocation Composite Index, a
hypothetical combination of unmanaged indices. The composite index
combines the total returns of the Standard & Poor's 500 Index, the
Lehman Brothers Aggregate Bond Index and the Lehman Brothers 3 Month
Treasury Bill Index, weighted according to the fund's neutral mix *.
The benchmarks listed in the table above include reinvested dividends
and capital gains, if any, and exclude the effect of sales charges.

AVERAGE ANNUAL TOTAL RETURNS

AVERAGE ANNUAL TOTAL RETURNS take Class T shares' cumulative return
and show you what would have happened if Class T shares had performed
at a constant rate each year. These numbers will be reported once the
fund is a year old. In addition, the growth of a hypothetical $10,000
investment in the fund will appear in the fund's next report six
months from now.

* CURRENTLY 70% STOCKS, 25% BONDS AND 5% SHORT-TERM/MONEY MARKET
INSTRUMENTS.

FIDELITY ADVISOR ASSET ALLOCATION FUND - CLASS B
PERFORMANCE: THE BOTTOM LINE

CUMULATIVE TOTAL RETURNS

PERIOD ENDED MAY 31, 1999 LIFE OF FUND

FIDELITY ADV ASSET ALLOCATION 3.50%
- - CL B

FIDELITY ADV ASSET ALLOCATION -1.50%
- - CL B (INCL. CONTINGENT
DEFERRED SALES CHARGE)

Fidelity Aggressive Composite 4.73%

S&P 500 6.81%

LB Aggregate Bond -0.52%

LB 3 Month T-Bill 1.92%

CUMULATIVE TOTAL RETURNS show Class B's performance in percentage
terms over a set period - in this case, since the fund started on
December 28, 1998. For example, if you had invested $1,000 in a fund
that had a 5% return over the past year, the value of your investment
would be $1,050. You can compare Class B's returns to the performance
of the Fidelity Aggressive Asset Allocation Composite Index, a
hypothetical combination of unmanaged indices. The composite index
combines the total returns of the Standard & Poor's 500 Index, the
Lehman Brothers Aggregate Bond Index and the Lehman Brothers 3 Month
Treasury Bill Index, weighted according to the fund's neutral mix *.
The benchmarks listed in the table above include reinvested dividends
and capital gains, if any, and exclude the effect of sales charges.

AVERAGE ANNUAL TOTAL RETURNS

AVERAGE ANNUAL TOTAL RETURNS take Class B shares' cumulative return
and show you what would have happened if Class B shares had performed
at a constant rate each year. These numbers will be reported once the
fund is a year old. In addition, the growth of a hypothetical $10,000
investment in the fund will appear in the fund's next report six
months from now.

* CURRENTLY 70% STOCKS, 25% BONDS AND 5% SHORT-TERM/MONEY MARKET
INSTRUMENTS.

FIDELITY ADVISOR ASSET ALLOCATION FUND - CLASS C
PERFORMANCE: THE BOTTOM LINE

CUMULATIVE TOTAL RETURNS

PERIOD ENDED MAY 31, 1999 LIFE OF FUND

FIDELITY ADV ASSET ALLOCATION 3.50%
- - CL C

FIDELITY ADV ASSET ALLOCATION 2.50%
- - CL C (INCL. CONTINGENT
DEFERRED SALES CHARGE)

Fidelity Aggressive Composite 4.73%

S&P 500 6.81%

LB Aggregate Bond -0.52%

LB 3 Month T-Bill 1.92%

CUMULATIVE TOTAL RETURNS show Class C's performance in percentage
terms over a set period - in this case, since the fund started on
December 28, 1998. For example, if you had invested $1,000 in a fund
that had a 5% return over the past year, the value of your investment
would be $1,050. You can compare Class C's returns to the performance
of the Fidelity Aggressive Asset Allocation Composite Index, a
hypothetical combination of unmanaged indices. The composite index
combines the total returns of the Standard & Poor's 500 Index, the
Lehman Brothers Aggregate Bond Index and the Lehman Brothers 3 Month
Treasury Bill Index, weighted according to the fund's neutral mix *.
The benchmarks listed in the table above include reinvested dividends
and capital gains, if any, and exclude the effect of sales charges.

AVERAGE ANNUAL TOTAL RETURNS

AVERAGE ANNUAL TOTAL RETURNS take Class C shares' cumulative return
and show you what would have happened if Class C shares had performed
at a constant rate each year. These numbers will be reported once the
fund is a year old. In addition, the growth of a hypothetical $10,000
investment in the fund will appear in the fund's next report six
months from now.

* CURRENTLY 70% STOCKS, 25% BONDS AND 5% SHORT-TERM/MONEY MARKET
INSTRUMENTS.

FUND TALK: THE MANAGER'S OVERVIEW

MARKET RECAP

Bullish sentiment surrounding
domestic equity markets for much of
the six-month period that ended
May 31, 1999, was quelled by the
Federal Reserve Board's shift in bias
in mid-May toward raising interest
rates. Signs of continued strength
and emerging inflationary
pressures in the U.S. economy
fueled uncertainty, inducing stock
markets to give back some of their
gains, but not before the Dow Jones
Industrial Average - an index of
30 blue-chip stocks - could lock in
a healthy return of 16.75% for the
period. The technology-laden
NASDAQ returned 26.93%, while
the Standard & Poor's 500 Index
produced a return of 12.61%. The
last two months of the period were
marked by the market's sudden
rotation to economically sensitive
cyclical and out-of-favor value
stocks. The movement away from
large-company growth stocks was
reflected in the rebound of the
small-cap universe, as portrayed by
the Russell 2000 Index, which
outpaced its larger-cap
counterparts in the S&P 500 by a
total of 8.51% for April and May.
Rising interest rates were not
well-received by the taxable-bond
market, as it struggled during the
period. The Lehman Brothers
Aggregate Bond Index - a widely
followed measure of taxable bond
performance - returned
- -0.76%. Bond bears were on the
prowl late in the period as a sharp
rise in consumer prices sparked the
worst Treasury sell-off in three
years, pushing bond prices down
and bringing yields up to the
pre-crisis levels of last summer.

(photograph of Richard Habermann)

An interview with Richard Habermann, Portfolio Manager of Fidelity
Advisor Asset Allocation Fund

Q. HOW DID THE FUND PERFORM, DICK?

A. The fund commenced operations on December 28, 1998. From that date
through May 31, 1999, the fund's Class A, Class T, Class B and Class C
shares returned 3.70%, 3.70%, 3.50% and 3.50%, respectively. The
Fidelity Aggressive Asset Allocation Composite Index returned 4.73%
during the same period. Going forward, we'll look at the fund's
performance in six- and 12-month intervals and compare it to its peer
group.

Q. WHAT WAS YOUR ALLOCATION STRATEGY DURING THE PERIOD AND HOW DID IT
AFFECT PERFORMANCE?

A. The fund's neutral mix of investments typically calls for 70% to be
invested in stocks, 25% in bonds and 5% in short-term and money market
instruments. Having close to 30% of the fund invested in bonds and
other short-term investments hurt in an equity-driven market. That
being said, a slight emphasis on equities relative to the neutral mix
helped performance, as did the fund's exposure to high-yield bond
issues.

Q. HOW DID THE FUND'S STOCK SUBPORTFOLIO PERFORM DURING THE PERIOD?

A. Individual security selection within the equity portfolio - which
is managed by Brad Lewis - was solid, but a narrow equity market
during the early stages of the period proved restrictive. The fund got
great results from some of its technology positions, including Sun
Microsystems and Lexmark International Group. Sun - which supplies
enterprise network computing products - was well-positioned within its
field, and Lexmark, a manufacturer of laser and inkjet printers,
benefited from increased demand for reasonably priced home and office
printers. Through the first couple of months of the period, however,
not owning enough of other technology names such as Lucent
Technologies hurt. Individual detractors, meanwhile, included names
such as Guidant Corp. and Intel. Guidant, which manufactures and
markets cardiac-related equipment, was hurt by falling revenues, while
chipmaker Intel was negatively affected by price-cutting within the
personal computer market.

Q. HOW DID THE BOND PORTION OF THE FUND FARE DURING THE PERIOD?

A. Despite rising interest rates, the fund's high-yield investments -
managed by Fred Hoff - performed quite well during the period as yield
spreads tightened relative to U.S. Treasuries. In addition, investor
perceptions of default risk - a key driver of performance within this
sector - were kept at bay due to improving global economies and
several domestic interest-rate cuts in the fall of 1998. In terms of
individual holdings, the fund's stake in Nextel Communications
performed well as the company continued to add wireless subscribers at
a rapid rate and also received an equity infusion from Microsoft.
Other investments that performed well included Chesapeake Energy and
Ocean Energy, each of which benefited as gas and oil prices rebounded.
Rising interest rates, however, spelled trouble for the fund's
investment-grade bond positions. Charlie Morrison, who manages this
portion of the fund, invested primarily in Treasuries during the
period. An overall increase in investor confidence, however, lured
buyers away from safer Treasuries in favor of higher-yielding
alternatives. This, combined with the tighter spreads between
high-yield bonds and Treasuries, made for a somewhat flat performance
period for the investment-grade subportfolio.

Q. WHAT WAS YOUR STRATEGY WITH RESPECT TO THE FUND'S SHORT-TERM/MONEY
MARKET INVESTMENTS DURING THE PERIOD?

A. Considering the general consensus that interest rates would be
headed upward, the manager of this subportfolio - John Todd - focused
primarily on short-term repurchase agreements during the period.
Repurchase agreements, commonly known as repos - are short-term
securities whereby the seller agrees to repurchase the securities at
an agreed-upon price and time. The benefit to the fund during the
period was that repos offered an effective vehicle in which to invest
assets on a temporary basis. They also provided an adequate level of
liquidity which, given the interest-rate outlook, was desirable. In
fact, some market followers feel the Fed may raise rates more than
once in the coming months. As more money comes into the fund and
market conditions settle, John will begin to look at other types of
money market instruments with varying maturities.

Q. WHAT'S YOUR OUTLOOK FOR THE COMING MONTHS?

A. Through the last couple months of the period, the market began to
show signs of increased breadth. Whereas stocks of larger companies
dominated in past periods, stocks of smaller companies finally began
to perform well. If world economies can continue to improve and more
stocks participate in the market's gains, that could play to
Fidelity's research strengths.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.

(checkmark)FUND FACTS

GOAL: maximum total return
over the long term through
investing in stocks, bonds
and short-term and money
market instruments

START DATE: December 28,
1998

SIZE: as of May 31, 1999,
more than $13 million

MANAGER: Richard Habermann,
since inception; joined
Fidelity in 1968

DICK HABERMANN TALKS ABOUT
HOW THE FUND IS MANAGED:

"The fund's equity, bond and money
market subportfolios are managed
by separate managers. My role
involves making tactical allocation
strategy decisions. While this
process can add value over time, it's
important for investors to
remember that good security
selection within each of the
subportfolios will be the primary
driver of excess returns over time.

"The fund's equity investments are
chosen using a computer-aided
quantitative discipline. From
models, we try to use historical
research and information to identify
stocks with the highest expected
return. In terms of the bond
portfolio, we avoid making any
interest-rate bets. That's a losing
proposition. Instead, we actively
select bonds and take a hands-on
approach to managing the fund's
bond exposure. The fund will
typically be overweighted in
corporate bonds and other
securities, but we also use high-yield
bonds to try to increase the fund's
long-term return and yield. We
also rely heavily on our dedicated
high-yield research group, one of
the largest in the industry.

"The end result, we hope, is an
asset allocation fund that leverages
what Fidelity does best in each of
these sectors."

INVESTMENT SUMMARY

TOP TEN STOCKS AS OF MAY 31,
1999

% OF FUND'S INVESTMENTS

Microsoft Corp. 3.4

Philip Morris Companies, Inc. 3.2

Wal-Mart Stores, Inc. 3.2

Guidant Corp. 2.7

BellSouth Corp. 2.7

Amgen, Inc. 2.6

Lucent Technologies, Inc. 2.4

Fannie Mae 2.3

Morgan Stanley, Dean Witter & 2.3
Co.

American International Group, 2.1
Inc.

TOP TEN MARKET SECTORS
(STOCKS ONLY) AS OF MAY 31,
1999

% OF FUND'S INVESTMENTS

FINANCE 11.7

UTILITIES 11.7

TECHNOLOGY 10.2

HEALTH 9.4

RETAIL & WHOLESALE 8.5

NONDURABLES 7.8

INDUSTRIAL MACHINERY & 4.7
EQUIPMENT

ENERGY 3.4

DURABLES 1.8

MEDIA & LEISURE 1.7

ASSET ALLOCATION

AS OF MAY 31, 1999 *

Stock class 74%

Bond class 19%

Short-term class 7%

* FOREIGN INVESTMENTS 6%

Row: 1, Col: 1, Value: 74.0
Row: 1, Col: 4, Value: 19.0
Row: 1, Col: 8, Value: 7.0

ASSET ALLOCATION IN THE PIE CHART REFLECT THE CATEGORIZATION OF ASSETS
AS DEFINED IN THE FUND'S PROSPECTUS IN EFFECT AS OF THE TIME PERIOD
INDICATED ABOVE. FINANCIAL STATEMENT CATEGORIZATIONS CONFORM TO
ACCOUNTING STANDARDS AND WILL DIFFER FROM THE PIE CHART.

INVESTMENTS MAY 31, 1999 (UNAUDITED)

Showing Percentage of Total Value of Investment in Securities

COMMON STOCKS - 71.8%

SHARES VALUE (NOTE 1)

AEROSPACE & DEFENSE - 0.5%

Boeing Co. 250 $ 10,563

United Technologies Corp. 1,050 65,166

75,729

BASIC INDUSTRIES - 0.3%

CHEMICALS & PLASTICS - 0.3%

Ashland, Inc. 900 36,675

CONSTRUCTION & REAL ESTATE -
0.9%

BUILDING MATERIALS - 0.7%

Fortune Brands, Inc. 470 19,211

Masco Corp. 2,870 81,974

101,185

CONSTRUCTION - 0.2%

Kaufman & Broad Home Corp. 860 20,748

TOTAL CONSTRUCTION & REAL 121,933
ESTATE

DURABLES - 1.8%

AUTOS, TIRES, & ACCESSORIES -
1.1%

Ford Motor Co. 2,880 164,340

CONSUMER ELECTRONICS - 0.3%

Maytag Corp. 610 43,043

TEXTILES & APPAREL - 0.4%

VF Corp. 1,110 51,060

TOTAL DURABLES 258,443

ENERGY - 3.4%

OIL & GAS - 3.4%

Chevron Corp. 1,600 148,300

Coastal Corp. (The) 1,100 42,419

Exxon Corp. 650 51,919

Mobil Corp. 520 52,650

Sunoco, Inc. 600 18,263

Texaco, Inc. 2,530 165,715

479,266

COMMON STOCKS - CONTINUED

SHARES VALUE (NOTE 1)

FINANCE - 11.7%

BANKS - 1.1%

Chase Manhattan Corp. 2,180 $ 158,050

CREDIT & OTHER FINANCE - 0.6%

Citigroup, Inc. 1,400 92,750

FEDERAL SPONSORED CREDIT - 3.3%

Fannie Mae 4,780 325,040

Freddie Mac 2,550 148,697

473,737

INSURANCE - 4.4%

AFLAC, Inc. 510 26,010

Allstate Corp. 3,690 134,454

American General Corp. 910 65,748

American International Group, 2,680 306,358
Inc.

Lincoln National Corp. 770 78,348

Nationwide Financial 380 16,411
Services, Inc. Class A

627,329

SECURITIES INDUSTRY - 2.3%

Morgan Stanley, Dean Witter & 3,350 323,275
Co.

TOTAL FINANCE 1,675,141

HEALTH - 9.4%

DRUGS & PHARMACEUTICALS - 4.9%

Amgen, Inc. (a) 5,970 377,603

Bristol-Myers Squibb Co. 4,280 293,715

Schering-Plough Corp. 830 37,402

708,720

MEDICAL EQUIPMENT & SUPPLIES
- - 4.5%

Cardinal Health, Inc. 880 53,130

Guidant Corp. 7,770 388,500

Johnson & Johnson 2,140 198,218

639,848

TOTAL HEALTH 1,348,568

INDUSTRIAL MACHINERY &
EQUIPMENT - 4.7%

ELECTRICAL EQUIPMENT - 2.9%

General Electric Co. 2,810 285,742

COMMON STOCKS - CONTINUED

SHARES VALUE (NOTE 1)

INDUSTRIAL MACHINERY &
EQUIPMENT - CONTINUED

ELECTRICAL EQUIPMENT -
CONTINUED

General Instrument Corp. (a) 690 $ 26,694

Honeywell, Inc. 1,020 96,518

408,954

INDUSTRIAL MACHINERY &
EQUIPMENT - 1.8%

Ingersoll-Rand Co. 2,560 163,040

Tyco International Ltd. 1,080 94,365

257,405

TOTAL INDUSTRIAL MACHINERY & 666,359
EQUIPMENT

MEDIA & LEISURE - 1.7%

PUBLISHING - 1.7%

Gannet, Inc. 730 52,743

McGraw-Hill Companies, Inc. 3,630 188,306

241,049

NONDURABLES - 7.8%

BEVERAGES - 0.9%

Anheuser-Busch Companies, 1,830 133,704
Inc.

FOODS - 2.5%

Heinz (H.J.) Co. 3,350 161,847

Quaker Oats Co. 2,910 192,242

354,089

HOUSEHOLD PRODUCTS - 1.2%

Avon Products, Inc. 1,200 59,325

Clorox Co. 1,070 108,003

167,328

TOBACCO - 3.2%

Philip Morris Companies, Inc. 12,060 465,064

TOTAL NONDURABLES 1,120,185

RETAIL & WHOLESALE - 8.5%

APPAREL STORES - 0.9%

Gap, Inc. 1,260 78,829

TJX Companies, Inc. 1,750 52,500

131,329

COMMON STOCKS - CONTINUED

SHARES VALUE (NOTE 1)

RETAIL & WHOLESALE - CONTINUED

DRUG STORES - 0.2%

Walgreen Co. 1,250 $ 29,063

GENERAL MERCHANDISE STORES -
4.4%

Dayton Hudson Corp. 1,940 122,220

Federated Department Stores, 750 40,875
Inc. (a)

Wal-Mart Stores, Inc. 10,890 464,186

627,281

GROCERY STORES - 1.0%

Safeway, Inc. (a) 3,010 139,965

RETAIL & WHOLESALE,
MISCELLANEOUS - 2.0%

Lowe's Companies, Inc. 5,620 291,889

TOTAL RETAIL & WHOLESALE 1,219,527

SERVICES - 0.2%

ADVERTISING - 0.2%

Interpublic Group of 410 31,058
Companies, Inc.

TECHNOLOGY - 10.2%

COMMUNICATIONS EQUIPMENT - 2.7%

Cisco Systems, Inc. (a) 400 43,600

Lucent Technologies, Inc. 5,900 335,563

379,163

COMPUTER SERVICES & SOFTWARE
- - 3.9%

International Business 540 62,809
Machines Corp.

Microsoft Corp. (a) 5,960 480,892

Novell, Inc. (a) 750 17,625

561,326

COMPUTERS & OFFICE EQUIPMENT
- - 1.4%

Lexmark International Group, 1,490 202,826
Inc. Class A (a)

ELECTRONICS - 2.2%

Intel Corp. 3,540 191,381

Motorola, Inc. 780 64,594

Texas Instruments, Inc. 530 57,969

313,944

TOTAL TECHNOLOGY 1,457,259

COMMON STOCKS - CONTINUED

SHARES VALUE (NOTE 1)

UTILITIES - 10.7%

CELLULAR - 0.6%

ALLTEL Corp. 1,170 $ 83,874

ELECTRIC UTILITY - 4.2%

DTE Energy Co. 2,110 91,917

Edison International 1,950 53,625

Energy East Corp. 400 11,100

GPU, Inc. 1,040 45,305

PECO Energy Co. 2,710 132,621

PG&E Corp. 1,000 33,750

PP&L Resources, Inc. 290 8,700

Public Service Enterprise 2,620 109,876
Group, Inc.

Reliant Energy, Inc. 3,640 111,020

597,914

TELEPHONE SERVICES - 5.9%

Ameritech Corp. 2,340 154,001

AT&T Corp. 670 37,185

BellSouth Corp. 8,230 388,353

CenturyTel, Inc. 630 24,137

Pathnet, Inc. warrants 30 300
4/15/08 (a)(d)

SBC Communications, Inc. 1,740 88,958

Sprint Corp. (FON Group) 1,340 151,085

844,019

TOTAL UTILITIES 1,525,807

TOTAL COMMON STOCKS 10,256,999
(Cost $10,275,500)

NONCONVERTIBLE PREFERRED
STOCKS - 1.0%

UTILITIES - 1.0%

CELLULAR - 0.6%

Nextel Communications, Inc.:

11.125% pay-in-kind 74 72,890

Series D, 13% pay-in-kind 10 10,600

83,490

TELEPHONE SERVICES - 0.4%

Hyperion Telecommunication, 4 3,720
Inc. 12.875% pay-in-kind

NONCONVERTIBLE PREFERRED
STOCKS - CONTINUED

SHARES VALUE (NOTE 1)

UTILITIES - CONTINUED

TELEPHONE SERVICES - CONTINUED

NEXTLINK Communications, Inc. 581 $ 29,776
14% pay-in-kind

WinStar Communications, Inc. 30 25,050
14.25%

58,546

TOTAL NONCONVERTIBLE 142,036
PREFERRED STOCKS
(Cost $134,597)

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
CORPORATE BONDS - 12.7%

MOODY'S RATINGS (UNAUDITED) (B) PRINCIPAL AMOUNT

CONVERTIBLE BONDS - 0.2%

HEALTH - 0.1%

MEDICAL FACILITIES MANAGEMENT
- - 0.1%

Total Renal Care Holdings, B1 $ 20,000 16,400
Inc. 7% 5/15/09 (d)

MEDIA & LEISURE - 0.1%

RESTAURANTS - 0.1%

CKE Restaurants, Inc. 4.25% B1 10,000 7,750
3/15/04

TOTAL CONVERTIBLE BONDS 24,150

NONCONVERTIBLE BONDS - 12.5%

BASIC INDUSTRIES - 1.3%

CHEMICALS & PLASTICS - 0.9%

Acetex Corp. yankee 9.75% B1 20,000 19,000
10/1/03

Lyondell Chemical Co.:

9.625% 5/1/07 (d) Ba3 10,000 10,150

9.875% 5/1/07 (d) Ba3 20,000 20,050

10.875% 5/1/09 (d) B2 10,000 10,150

Pioneer Americas Acquisition B2 10,000 8,500
Corp. 9.25% 6/15/07

Sterling Chemicals, Inc.:

11.25% 4/1/07 B3 30,000 27,750

11.75% 8/15/06 B3 30,000 28,350

123,950

CORPORATE BONDS - CONTINUED

MOODY'S RATINGS (UNAUDITED) (B) PRINCIPAL AMOUNT VALUE (NOTE 1)

NONCONVERTIBLE BONDS -
CONTINUED

BASIC INDUSTRIES - CONTINUED

METALS & MINING - 0.3%

Kaiser Aluminum & Chemical B3 $ 50,000 $ 50,750
Corp. 12.75% 2/1/03

PACKAGING & CONTAINERS - 0.1%

Gaylord Container Corp. Caa1 10,000 9,375
9.375% 6/15/07

TOTAL BASIC INDUSTRIES 184,075

CONSTRUCTION & REAL ESTATE -
0.7%

CONSTRUCTION - 0.3%

U.S. Home Corp. 8.875% 2/15/09 B1 40,000 38,300

ENGINEERING - 0.1%

Anteon Corp. 12% 5/15/09 (d) B3 20,000 20,000

REAL ESTATE - 0.3%

LNR Property Corp. 9.375% B1 50,000 47,875
3/15/08

TOTAL CONSTRUCTION & REAL 106,175
ESTATE

DURABLES - 0.2%

CONSUMER DURABLES - 0.1%

Corning Consumer Products Co. B3 20,000 17,500
9.625% 5/1/08

TEXTILES & APPAREL - 0.1%

Worldtex, Inc. 9.625% 12/15/07 B1 10,000 8,700

TOTAL DURABLES 26,200

ENERGY - 0.9%

COAL - 0.1%

P&L Coal Holdings Corp. B2 20,000 19,950
9.625% 5/15/08

ENERGY SERVICES - 0.2%

R&B Falcon Corp. 6.5% 4/15/03 Ba3 40,000 33,600

OIL & GAS - 0.6%

Chesapeake Energy Corp. B3 10,000 8,850
9.625% 5/1/05

CORPORATE BONDS - CONTINUED

MOODY'S RATINGS (UNAUDITED) (B) PRINCIPAL AMOUNT VALUE (NOTE 1)

NONCONVERTIBLE BONDS -
CONTINUED

ENERGY - CONTINUED

OIL & GAS - CONTINUED

Comstock Resources, Inc. B2 $ 30,000 $ 30,075
11.25% 5/1/07 (d)

Ocean Energy, Inc. 8.875% B1 40,000 40,200
7/15/07

79,125

TOTAL ENERGY 132,675

FINANCE - 1.1%

CREDIT & OTHER FINANCE - 1.1%

AMRESCO, Inc.:

9.875% 3/15/05 Caa3 20,000 16,300

10% 3/15/04 Caa3 40,000 33,200

ContiFinancial Corp. 8.375% Caa1 10,000 8,700
8/15/03

Macsaver Financial Services,
Inc.:

7.4% 2/15/02 Ba1 10,000 7,700

7.6% 8/1/07 Ba1 20,000 15,600

Ono Finance PLC 13% 5/1/09 - 20,000 20,000
unit (d)

RBF Finance Co. 11% 3/15/06 Ba3 60,000 60,300
(d)

161,800

HEALTH - 0.5%

DRUGS & PHARMACEUTICALS - 0.2%

Global Health Sciences, Inc. Caa1 30,000 22,200
11% 5/1/08

MEDICAL FACILITIES MANAGEMENT
- - 0.3%

Fountain View, Inc. 11.25% Caa1 50,000 42,000
4/15/08

TOTAL HEALTH 64,200

INDUSTRIAL MACHINERY &
EQUIPMENT - 0.4%

INDUSTRIAL MACHINERY &
EQUIPMENT - 0.2%

Dunlop Standard Aero Holdings B3 20,000 20,000
PLC 11.875% 5/15/09 (d)

Tokheim Corp. 11.375% 8/1/08 B3 10,000 9,825
(d)

29,825

CORPORATE BONDS - CONTINUED

MOODY'S RATINGS (UNAUDITED) (B) PRINCIPAL AMOUNT VALUE (NOTE 1)

NONCONVERTIBLE BONDS -
CONTINUED

INDUSTRIAL MACHINERY &
EQUIPMENT - CONTINUED

POLLUTION CONTROL - 0.2%

IT Group, Inc. (The) 11.25% B3 $ 30,000 $ 29,700
4/1/09 (d)

TOTAL INDUSTRIAL MACHINERY & 59,525
EQUIPMENT

MEDIA & LEISURE - 4.3%

BROADCASTING - 2.8%

Bresnan Communications Group B2 20,000 13,200
LLC/Bresnan Capital Corp. 0%
2/1/09 (c)(d)

Chancellor Media Corp.:

8.125% 12/15/07 B1 50,000 49,375

9% 10/1/08 B1 20,000 20,700

Charter Communications B2 50,000 48,875
Holdings LLC/Charter
Communications Holdings
Capital Corp. 8.625% 4/1/09
(d)

Classic Cable, Inc. 9.875% B3 10,000 10,450
8/1/08 (d)

Diamond Cable Communications B3 80,000 62,800
PLC 0% 2/15/07 (c)

Falcon Holding Group B2 20,000 13,950
LP/Falcon Funding Corp. 0%
4/15/10 (c)

FrontierVision Operating B3 20,000 22,400
Partners LP/ FrontierVision
Capital Corp. 11% 10/15/06

Golden Sky DBS, Inc. 0% Caa1 30,000 17,700
3/1/07 (c)(d)

Knology Holding, Inc. 0% - 30,000 17,550
10/15/07 (c)

NTL, Inc. 0% 4/1/08 (c) B3 20,000 13,400

Spectrasite Holdings, Inc. 0% - 30,000 17,025
4/15/09 (c)(d)

TeleWest Communications PLC B1 20,000 13,050
0% 4/15/09 (c)(d)

Telewest PLC 0% 10/1/07 (c) B1 50,000 43,625

United International B3 50,000 32,500
Holdings, Inc. 0% 2/15/08 (c)

396,600

ENTERTAINMENT - 0.5%

Bally Total Fitness Holding B3 50,000 49,000
Corp. 9.875% 10/15/07

Regal Cinemas, Inc. 8.875% B3 30,000 27,675
12/15/10

76,675

CORPORATE BONDS - CONTINUED

MOODY'S RATINGS (UNAUDITED) (B) PRINCIPAL AMOUNT VALUE (NOTE 1)

NONCONVERTIBLE BONDS -
CONTINUED

MEDIA & LEISURE - CONTINUED

LODGING & GAMING - 0.7%

Coast Hotels & Casinos, Inc. B3 $ 30,000 $ 29,025
9.5% 4/1/09 (d)

HMH Properties, Inc. 7.875% Ba2 30,000 27,750
8/1/08

Host Marriott LP 8.375% Ba2 40,000 38,600
2/15/06 (d)

95,375

RESTAURANTS - 0.3%

CKE Restaurants, Inc. 9.125% B1 20,000 19,150
5/1/09 (d)

Domino's, Inc. 10.375% B3 20,000 20,400
1/15/09 (d)

NE Restaurant, Inc. 10.75% B3 10,000 9,275
7/15/08

48,825

TOTAL MEDIA & LEISURE 617,475

RETAIL & WHOLESALE - 0.2%

GROCERY STORES - 0.2%

Jitney-Jungle Stores of Caa1 20,000 15,000
America, Inc. 10.375% 9/15/07

Pathmark Stores, Inc. 9.625% Caa1 10,000 10,150
5/1/03

25,150

TECHNOLOGY - 0.4%

COMPUTER SERVICES & SOFTWARE
- - 0.2%

Rhythms NetConnections, Inc. - 25,000 23,500
12.75% 4/15/09 (d)

ELECTRONICS - 0.2%

Fairchild Semiconductor Corp. B3 30,000 30,075
10.375% 10/1/07 (d)

TOTAL TECHNOLOGY 53,575

UTILITIES - 2.5%

CELLULAR - 0.4%

Millicom International Caa1 10,000 7,450
Cellular SA 0% 6/1/06 (c)

Nextel Communications, Inc. B2 10,000 6,625
0% 2/15/08 (c)

Teligent, Inc. 0% 3/1/08 (c) Caa1 50,000 28,750

Tritel Pcs, Inc. 0% 5/15/09 B3 20,000 10,150
(c)(d)

52,975

CORPORATE BONDS - CONTINUED

MOODY'S RATINGS (UNAUDITED) (B) PRINCIPAL AMOUNT VALUE (NOTE 1)

NONCONVERTIBLE BONDS -
CONTINUED

UTILITIES - CONTINUED

TELEPHONE SERVICES - 2.1%

Covad Communications Group, B3 $ 40,000 $ 21,600
Inc. 0% 3/15/08 (c)

GST Network Funding, Inc. 0% - 20,000 11,350
5/1/08 (c)(d)

GST Telecommunications, Inc. - 50,000 52,500
12.75% 11/15/07

Hyperion Telecommunications, Caa1 10,000 10,125
Inc. 12% 11/1/07 (d)

Intermedia Communications, B2 40,000 37,400
Inc. 8.6% 6/1/08

IXC Communications, Inc. 9% B3 30,000 28,950
4/15/08

KMC Telecom Holdings, Inc. Caa2 20,000 20,000
13.5% 5/15/09 (d)

NEXTLINK Communications, Inc. B3 30,000 28,350
9.625% 10/1/07

Pathnet, Inc. 12.25% 4/15/08 - 30,000 16,800

WinStar Communications, Inc.:

0% 10/15/05 (c) Caa1 20,000 16,300

0% 10/15/05 (c) Caa1 30,000 39,300

15% 3/1/07 CCC 20,000 21,200

303,875

TOTAL UTILITIES 356,850

TOTAL NONCONVERTIBLE BONDS 1,787,700

TOTAL CORPORATE BONDS 1,811,850
(Cost $1,809,933)

U.S. TREASURY OBLIGATIONS -
5.8%

U.S. Treasury Bonds:

6.875% 8/15/25 Aaa 65,000 71,713

7.625% 2/15/25 Aaa 47,000 56,385

8.875% 8/15/17 Aaa 70,000 90,901

9.875% 11/15/15 Aaa 10,000 13,872

U.S. Treasury Notes:

6.625% 6/30/01 Aaa 281,000 287,323

U.S. TREASURY OBLIGATIONS -
CONTINUED

MOODY'S RATINGS (UNAUDITED) (B) PRINCIPAL AMOUNT VALUE (NOTE 1)

U.S. Treasury Notes: -
continued

6.875% 3/31/00 Aaa $ 60,000 $ 60,869

7% 7/15/06 Aaa 234,000 249,905

TOTAL U.S. TREASURY OBLIGATIONS 830,968
(Cost $843,754)

CASH EQUIVALENTS - 8.7%

MATURITY AMOUNT

Investments in repurchase
agreements (U.S. Treasury
obligations), in a joint
trading account at:

4.8%, dated 5/28/99 due 6/1/99 $ 1,149,613 1,149,000

4.83%, dated 5/28/99 due 100,054 100,000
6/1/99

TOTAL CASH EQUIVALENTS 1,249,000
(Cost $1,249,000)

TOTAL INVESTMENT IN $ 14,290,853
SECURITIES - 100%
(Cost $14,312,784)

</TABLE>

LEGEND

(a) Non-income producing

(b) Standard & Poor's credit ratings are used in the absence of a
rating by Moody's Investors Service, Inc.

(c) Debt obligation initially issued in zero coupon form which
converts to coupon form at a specified rate and date. The rate shown
is the rate at period end.

(d) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in
transactions exempt from registration, normally to qualified
institutional buyers. At the period end, the value of these securities
amounted to $579,625 or 4.2% of net assets.

OTHER INFORMATION

The composition of long-term debt holdings as a percentage of total
value of investments in securities, is as follows (ratings are
unaudited):

MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 5.8% AAA, AA, A 5.8%
Baa 0.0% BBB 0.0%
Ba 1.5% BB 1.7%
B 7.8% B 7.5%
Caa 2.1% CCC 2.1%
Ca, C 0.0% CC, C 0.0%
D 0.0%

The percentage not rated by Moody's or S&P amounted to 1.1%. FMR has
determined that unrated debt securities that are lower quality account
for 1.1% of the total value of investment in securities.

INCOME TAX INFORMATION

At May 31, 1999, the aggregate cost of investment securities for
income tax purposes was $14,323,999. Net unrealized depreciation
aggregated $33,146, of which $442,868 related to appreciated
investment securities and $476,014 related to depreciated investment
securities.

FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

MAY 31, 1999 (UNAUDITED)

ASSETS

Investment in securities, at $ 14,290,853
value (including repurchase
agreements of $1,249,000)
(cost $14,312,784) - See
accompanying schedule

Cash 10,989

Receivable for investments 95,790
sold

Receivable for fund shares 317,788
sold

Dividends receivable 12,903

Interest receivable 47,867

Prepaid expenses 48,704

Receivable from investment 10,645
adviser for expense
reductions

TOTAL ASSETS 14,835,539

LIABILITIES

Payable for investments $ 1,024,289
purchased

Payable for fund shares 11,339
redeemed

Distribution fees payable 6,952

Other payables and accrued 23,880
expenses

TOTAL LIABILITIES 1,066,460

NET ASSETS $ 13,769,079

Net Assets consist of:

Paid in capital $ 13,785,820

Undistributed net investment 31,682
income

Accumulated undistributed net (26,492)
realized gain (loss) on
investments

Net unrealized appreciation (21,931)
(depreciation) on investments

NET ASSETS $ 13,769,079

STATEMENT OF ASSETS AND LIABILITIES - CONTINUED

MAY 31, 1999 (UNAUDITED)

CALCULATION OF MAXIMUM $10.37
OFFERING PRICE CLASS A: NET
ASSET VALUE and redemption
price per share
($1,065,360 (divided by)
102,699 shares)

Maximum offering price per $11.00
share (100/94.25 of $10.37)

CLASS T: NET ASSET VALUE and $10.37
redemption price per share
($5,901,530 (divided by)
569,281 shares)

Maximum offering price per $10.75
share (100/96.50 of $10.37)

CLASS B: NET ASSET VALUE and $10.35
offering price per share
($3,924,147 (divided by)
379,149 shares) A

CLASS C: NET ASSET VALUE and $10.35
offering price per share
($2,093,343 (divided by)
202,351 shares) A

INSTITUTIONAL CLASS: NET $10.39
ASSET VALUE, offering price
and redemption price per
share ($784,699 (divided by)
75,536 shares)

REDEMPTION PRICE PER SHARE IS EQUAL TO NET ASSET VALUE LESS ANY
APPLICABLE CONTINGENT DEFERRED SALES CHARGE.

STATEMENT OF OPERATIONS

DECEMBER 28, 1998
(COMMENCEMENT OF OPERATIONS)
TO MAY 31, 1999 (UNAUDITED)

INVESTMENT INCOME $ 32,603
Dividends

Interest 66,942

TOTAL INCOME 99,545

EXPENSES

Management fee $ 18,858

Transfer agent fees 7,897

Distribution fees 20,489

Accounting fees and expenses 25,706

Non-interested trustees' 7
compensation

Custodian fees and expenses 8,728

Registration fees 57,756

Audit 11,220

Legal 3

Miscellaneous 120

Total expenses before 150,784
reductions

Expense reductions (82,921) 67,863

NET INVESTMENT INCOME 31,682

REALIZED AND UNREALIZED GAIN (26,492)
(LOSS)
Net realized gain (loss) on
investment securities

Change in net unrealized (21,931)
appreciation (depreciation)
on investment securities

NET GAIN (LOSS) (48,423)

NET INCREASE (DECREASE) IN $ (16,741)
NET ASSETS RESULTING FROM
OPERATIONS

STATEMENT OF CHANGES IN NET ASSETS

DECEMBER 28, 1998
(COMMENCEMENT OF
OPERATIONS) TO MAY 31, 1999
(UNAUDITED)

INCREASE (DECREASE) IN NET
ASSETS

Operations Net investment $ 31,682
income

Net realized gain (loss) (26,492)

Change in net unrealized (21,931)
appreciation (depreciation)

NET INCREASE (DECREASE) IN (16,741)
NET ASSETS RESULTING FROM
OPERATIONS

Share transactions - net 13,785,820
increase (decrease)

TOTAL INCREASE (DECREASE) 13,769,079
IN NET ASSETS

NET ASSETS

Beginning of period -

End of period (including $ 13,769,079
undistributed net investment
income of $31,682)

FINANCIAL HIGHLIGHTS - CLASS A

MAY 31, 1999 E

(UNAUDITED)

SELECTED PER-SHARE DATA

Net asset value, beginning of $ 10.00
period

Income from Investment
Operations

Net investment income D .06

Net realized and unrealized .31 G
gain (loss)

Total from investment .37
operations

Net asset value, end of period $ 10.37

TOTAL RETURN B, C 3.70%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period $ 1,065
(000 omitted)

Ratio of expenses to average 1.75% A, F
net assets

Ratio of net investment 1.38% A
income to average net assets

Portfolio turnover 111% A

A ANNUALIZED

B THE TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD SHOWN.

C TOTAL RETURN DOES NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.

D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.

E FOR THE PERIOD DECEMBER 28, 1998 (COMMENCEMENT OF OPERATIONS) TO MAY
31, 1999.

F FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'
EXPENSE RATIO WOULD HAVE BEEN HIGHER.

G THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH
THE AGGREGATE NET LOSS ON INVESTMENTS FOR THE PERIOD DUE TO THE TIMING
OF SALES AND REPURCHASES OF CLASS SHARES IN RELATION TO FLUCTUATING
MARKET VALUES OF THE INVESTMENTS OF THE FUND.

FINANCIAL HIGHLIGHTS - CLASS T

MAY 31, 1999 E

(UNAUDITED)

SELECTED PER-SHARE DATA

Net asset value, beginning of $ 10.00
period

Income from Investment
Operations

Net investment income D .05

Net realized and unrealized .32 H
gain (loss)

Total from investment .37
operations

Net asset value, end of period $ 10.37

TOTAL RETURN B, C 3.70%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period $ 5,902
(000 omitted)

Ratio of expenses to average 2.00% A, F
net assets

Ratio of expenses to average 1.99% A, G
net assets after expense
reductions

Ratio of net investment 1.13% A
income to average net assets

Portfolio turnover 111% A

A ANNUALIZED

B THE TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD SHOWN.

C TOTAL RETURN DOES NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.

D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.

E FOR THE PERIOD DECEMBER 28, 1998 (COMMENCEMENT OF OPERATIONS) TO MAY
31, 1999.

F FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'
EXPENSE RATIO WOULD HAVE BEEN HIGHER.

G FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE CLASS' EXPENSES.

H THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH
THE AGGREGATE NET LOSS ON INVESTMENTS FOR THE PERIOD DUE TO THE TIMING
OF SALES AND REPURCHASES OF CLASS SHARES IN RELATION TO FLUCTUATING
MARKET VALUES OF THE INVESTMENTS OF THE FUND.

FINANCIAL HIGHLIGHTS - CLASS B

MAY 31, 1999 E

(UNAUDITED)

SELECTED PER-SHARE DATA

Net asset value, beginning of $ 10.00
period

Income from Investment
Operations

Net investment income D .03

Net realized and unrealized .32 G
gain (loss)

Total from investment .35
operations

Net asset value, end of period $ 10.35

TOTAL RETURN B, C 3.50%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period $ 3,924
(000 omitted)

Ratio of expenses to average 2.50% A, F
net assets

Ratio of net investment .63% A
income to average net assets

Portfolio turnover 111% A

A ANNUALIZED

B THE TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD SHOWN.

C TOTAL RETURN DOES NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE
AND FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.

D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.

E FOR THE PERIOD DECEMBER 28, 1998 (COMMENCEMENT OF OPERATIONS) TO MAY
31, 1999.

F FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD
HAVE BEEN HIGHER.

FINANCIAL HIGHLIGHTS - CLASS C

MAY 31, 1999 E

(UNAUDITED)

SELECTED PER-SHARE DATA

Net asset value, beginning of $ 10.00
period

Income from Investment
Operations

Net investment income D .03

Net realized and unrealized .32 G
gain (loss)

Total from investment .35
operations

Net asset value, end of period $ 10.35

TOTAL RETURN B, C 3.50%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period $ 2,093
(000 omitted)

Ratio of expenses to average 2.50% A, F
net assets

Ratio of net investment .63% A
income to average net assets

Portfolio turnover 111% A

A ANNUALIZED

B THE TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD SHOWN.

C TOTAL RETURN DOES NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE
AND FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.

D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.

E FOR THE PERIOD DECEMBER 28, 1998 (COMMENCEMENT OF OPERATIONS) TO MAY
31, 1999.

F FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD
HAVE BEEN HIGHER.

FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS

MAY 31, 1999 E

(UNAUDITED)

SELECTED PER-SHARE DATA

Net asset value, beginning of $ 10.00
period

Income from Investment
Operations

Net investment income D .07

Net realized and unrealized .32 G
gain (loss)

Total from investment .39
operations

Net asset value, end of period $ 10.39

TOTAL RETURN B, C 3.90%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period $ 785
(000 omitted)

Ratio of expenses to average 1.50% A, F
net assets

Ratio of net investment 1.63% A
income to average net assets

Portfolio turnover 111% A

A ANNUALIZED

B THE TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD SHOWN.

C TOTAL RETURN FOR PERIOD OF LESS THAN ONE YEAR IS ANNUALIZED.

D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.

E FOR THE PERIOD DECEMBER 28, 1998 (COMMENCEMENT OF OPERATIONS) TO MAY
31, 1999.

F FMR AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO WOULD
HAVE BEEN HIGHER.

NOTES TO FINANCIAL STATEMENTS

For the period ended May 31, 1999 (Unaudited)

1. SIGNIFICANT ACCOUNTING POLICIES.

Fidelity Advisor Asset Allocation Fund (the fund) is a fund of
Fidelity Advisor Series I (the trust) and is authorized to issue an
unlimited number of shares. The trust is registered under the
Investment Company Act of 1940, as amended (the 1940 Act), as an
open-end management investment company organized as a Massachusetts
business trust.

The fund offers Class A, Class T, Class B, Class C, and Institutional
Class shares, each of which has equal rights as to assets and voting
privileges. Each class has exclusive voting rights with respect to
matters that affect that class. Class B shares will automatically
convert to Class A shares after a holding period of seven years from
the initial date of purchase.Investment income, realized and
unrealized capital gains and losses, the common expenses of the fund,
and certain fund-level expense reductions, if any, are allocated on a
pro rata basis to each class based on the relative net assets of each
class to the total net assets of the fund. Each class of shares
differs in its respective distribution, transfer agent, and certain
other class-specific fees, expenses, and expense reductions.

SECURITY VALUATION. Equity securities for which quotations are readily
available are valued at the last sale price, or if no sale price, at
the closing bid price. Debt securities for which quotations are
readily available are valued by a pricing service at their market
values as determined by their most recent bid prices in the principal
market (sales prices if the principal market is an exchange) in which
such securities are normally traded. Securities (including restricted
securities) for which market quotations are not readily available are
valued at their fair value as determined in good faith under
consistently applied procedures under the general supervision of the
Board of Trustees. Short-term securities with remaining maturities of
sixty days or less for which quotations are not readily available are
valued at amortized cost or original cost plus accrued interest, both
of which approximate current value.

1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

FOREIGN CURRENCY TRANSLATION - CONTINUED

date on purchases and sales of securities. The effects of changes in
foreign currency exchange rates on investments in securities are
included with the net realized and unrealized gain or loss on
investment securities.

INCOME TAXES. The fund intends to qualify as a regulated investment
company under Subchapter M of the Internal Revenue Code. By so
qualifying, the fund will not be subject to income taxes to the extent
that it distributes substantially all of its taxable income for its
fiscal year. The schedule of investments includes information
regarding income taxes under the caption "Income Tax Information."

INVESTMENT INCOME. Dividend income is recorded on the ex-dividend
date, except certain dividends from foreign securities where the
ex-dividend date may have passed, are recorded as soon as the funds
are informed of the ex-dividend date. Non-cash dividends included in
dividend income, if any, are recorded at the fair market value of the
securities received. Interest income, which includes accretion of
original issue discount, is accrued as earned. Investment income is
recorded net of foreign taxes withheld where recovery of such taxes is
uncertain.

EXPENSES. Most expenses of trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned among the
funds in the trust.

PREPAID EXPENSES. Fidelity Management & Research Company (FMR) bears
all organizational expenses of the funds except for the cost of
registering and qualifying shares of each class for distribution under
federal and state securities law. These registration expenses are
borne by the fund and amortized over one year.

DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date. Income dividends and capital gain distributions are
declared separately for each class.

Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income and accumulated undistributed net
realized gain (loss) on investments may include temporary book and tax
basis differences which will reverse in a subsequent period. Any
taxable income or gain remaining at fiscal year end is distributed in
the following year.

SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.

2. OPERATING POLICIES.

FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign-denominated
securities. Losses may arise from changes in the value of the foreign
currency or if the counterparties do not perform under the contracts'
terms. The U.S. dollar value of foreign currency contracts is
determined using contractual currency exchange rates established at
the time of each trade.

JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission the fund, along with other
affiliated entities of FMR, may transfer uninvested cash balances into
one or more joint trading accounts. These balances are invested in one
or more repurchase agreements for U.S. Treasury or Federal Agency
obligations.

REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
securities are transferred to an account of the fund, or to the Joint
Trading Account, at a bank custodian. The securities are
marked-to-market daily and maintained at a value at least equal to the
principal amount of the repurchase agreement (including accrued
interest). FMR, the fund's investment adviser, is responsible for
determining that the value of the underlying securities remains in
accordance with the market value requirements stated above.

RESTRICTED SECURITIES. The fund is permitted to invest in securities
that are subject to legal or contractual restrictions on resale. These
securities generally may be resold in transactions exempt from
registration or to the public if the securities are registered.
Disposal of these securities may involve time-consuming negotiations
and expense, and prompt sale at an acceptable price may be difficult.
At the end of the period, the fund had no investments in restricted
securities (excluding 144A issues).

3. PURCHASES AND SALES OF INVESTMENTS.

Purchases and sales of securities, other than short-term securities,
aggregated $16,464,609 and $3,383,404, respectively of which U.S.
government and government agency obligations aggregated $1,028,798 and
$182,597, respectively.

4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.

MANAGEMENT FEE. As the fund's investment adviser, FMR receives a
monthly fee that is calculated on the basis of a group fee rate plus a
fixed individual fund fee rate applied to the average net assets of
the fund. The group fee rate is the weighted average of a series of
rates and is based on the monthly average net assets of all the mutual
funds advised by FMR. The rates ranged from: .2500% to .5200% for the
period. The annual individual fund fee rate is .30%. In the event that
these rates were lower than the contractual rates in

4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED

MANAGEMENT FEE - CONTINUED

effect during the period, FMR voluntarily implemented the above rates,
as they resulted in the same or a lower management fee. For the
period, the management fee was equivalent to an annualized rate of
.58% of average net assets.

DISTRIBUTION AND SERVICE PLAN. In accordance with Rule 12b-1 of the
1940 Act, the Trustees have adopted separate distribution plans with
respect to each class of shares (collectively referred to as "the
Plans"). Under certain of the Plans, the class pays Fidelity
Distributors Corporation (FDC), an affiliate of FMR, a distribution
and service fee. A portion of this fee may be reallowed to securities
dealers, banks and other financial institutions for the distribution
of each class of shares and providing shareholder support services.
For the period, this fee was based on the following annual rates of
the average net assets of each applicable class:

CLASS A .25%

CLASS T .50%

CLASS B 1.00% *

CLASS C 1.00% *

* .75% REPRESENTS A DISTRIBUTION FEE AND .25% REPRESENTS A SHAREHOLDER
SERVICE FEE.

For the period, each class paid FDC the following amounts, a portion
of which was retained by FDC:

PAID TO FDC RETAINED BY FDC

CLASS A $ 874 $ 661

CLASS T 6,255 1,131

CLASS B 8,507 6,986

CLASS C 4,853 4,794

$ 20,489 $ 13,572

4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED

SALES LOAD. FDC receives a front-end sales charge of up to 5.75% for
selling Class A shares, and 3.50% for selling Class T shares of the
fund. FDC receives the proceeds of contingent deferred sales charges
levied on Class B share redemptions occurring within six years of
purchase and Class C share redemptions occurring within one year of
purchase. Contingent deferred sales charges are based on declining
rates ranging from 5% to 1% for Class B and 1% for Class C, of the
lesser of the cost of shares at the initial date of purchase or the
net asset value of the redeemed shares, excluding any reinvested
dividends and capital gains. In addition, purchases of Class A and
Class T shares that were subject to a finder's fee bear a contingent
deferred sales charge on assets that do not remain in the fund for at
least one year. The Class A and Class T contingent deferred sales
charge is based on .25% of the lesser of the cost of shares at the
initial date of purchase or the net asset value of the redeemed
shares, excluding any reinvested dividends and capital gains. A
portion of the sales charges paid to FDC are paid to securities
dealers, banks and other financial institutions.

For the period, sales charge amounts paid to and retained by FDC were
as follows:

PAID TO FDC RETAINED BY FDC

CLASS A $ 7,757 $ 7,244

CLASS T 15,787 12,054

CLASS B - - *

CLASS C 4 4 *

$ 23,548 $ 19,302

* WHEN CLASS B AND CLASS C SHARES ARE INITIALLY SOLD, FDC PAYS
COMMISSIONS FROM ITS OWN RESOURCES TO SECURITIES DEALERS,
BANKS, AND OTHER FINANCIAL INSTITUTIONS THROUGH WHICH THE SALES ARE
MADE.

4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED

TRANSFER AGENT FEES - CONTINUED

the shareholders of the respective classes of the fund. FIIOC pays for
typesetting, printing and mailing of all shareholder reports, except
proxy statements. For the period, the following amounts were paid to
FIIOC:

AMOUNT % OF AVERAGE NET ASSETS

CLASS A $ 1,005 .29 *

CLASS T 2,484 .20 *

CLASS B 2,266 .27 *

CLASS C 1,376 .29 *

INSTITUTIONAL CLASS 766 .26 *

$ 7,897

* ANNUALIZED

BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid to these affiliated firms were $584 for the period.

5. EXPENSE REDUCTIONS.

FMR voluntarily agreed to reimburse operating expenses (excluding
interest, taxes, securities lending fees, brokerage commissions and
extraordinary expenses, if any) above the following annual rates or
range of annual rates of average net assets for each of the following
classes:

FMR EXPENSE LIMITATIONS REIMBURSEMENT

CLASS A 1.75% $ 9,050

CLASS T 2.00% 31,561

CLASS B 2.50% 22,047

CLASS C 2.50% 12,638

INSTITUTIONAL CLASS 1.50% 7,556

$ 82,852

5. EXPENSE REDUCTIONS - CONTINUED

In addition, the fund has entered into an arrangement with each class'
transfer agent whereby credits realized as a result of uninvested cash
balances were used to reduce a portion of expenses. During the period
Class T's expenses were reduced by $69 under the transfer agent
arrangement.

6. BENEFICIAL INTEREST.

At the end of the period FDC, an affiliate of FMR was record owner of
approximately 23% of the total outstanding shares of the fund. In
addition, one unaffiliated shareholder was record owner of more than
10% of the total outstanding shares of the fund.

7. SHARE TRANSACTIONS.

Transactions for each class of shares for the periods are as follows:

<TABLE>
<CAPTION>
<S> <C> <C> <C>
SHARES DOLLARS

DECEMBER 28, 1998 DECEMBER 28, 1998
(COMMENCEMENT OF OPERATIONS) (COMMENCEMENT OF OPERATIONS)
TO MAY 31, 1999 TO MAY 31, 1999

CLASS A Shares sold 102,757 $ 1,048,500

Shares redeemed (58) (600)

Net increase (decrease) 102,699 $ 1,047,900

CLASS T Shares sold 601,001 $ 6,270,921

Shares redeemed (31,720) (335,145)

Net increase (decrease) 569,281 $ 5,935,776

CLASS B Shares sold 381,453 $ 3,964,489

Shares redeemed (2,304) (24,022)

Net increase (decrease) 379,149 $ 3,940,467

CLASS C Shares sold 203,570 $ 2,108,953

Shares redeemed (1,219) (12,683)

Net increase (decrease) 202,351 $ 2,096,270

INSTITUTIONAL CLASS Shares 75,536 $ 765,407
sold

</TABLE>

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA

INVESTMENT SUB-ADVISERS
Fidelity Investments
Money Management, Inc. (FIMM),
Merrimack, NH
Fidelity Management & Research (U.K.)
Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan

OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Robert A. Lawrence, Vice President
Richard C. Habermann, Vice President
Eric D. Roiter, Secretary
Richard A. Silver, Treasurer
Matthew N. Karstetter, Deputy Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer

BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *

ADVISORY BOARD
J. Gary Burkhead

GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA

TRANSFER AND SHAREHOLDER
SERVICING AGENTS
Fidelity Investments Institutional
Operations Company, Inc.
Boston, MA

CUSTODIAN
State Street Bank and Trust Company
Quincy, MA

FOCUS FUNDS
Fidelity Advisor Consumer
Industries Fund
Fidelity Advisor Cyclical
Industries Fund
Fidelity Advisor Financial
Services Fund
Fidelity Advisor Health Care Fund
Fidelity Advisor Natural
Resources Fund
Fidelity Advisor Technology Fund
Fidelity Advisor Utilities Growth Fund

GROWTH FUNDS
Fidelity Advisor Latin America Fund
Fidelity Advisor Emerging Asia Fund
Fidelity Advisor Japan Fund
Fidelity Advisor Europe Capital Appreciation Fund
Fidelity Advisor International Capital Appreciation Fund
Fidelity Advisor Overseas Fund
Fidelity Advisor Diversified International Fund
Fidelity Advisor Global Equity Fund
Fidelity Advisor TechnoQuantSM
Growth Fund
Fidelity Advisor Small Cap Fund
Fidelity Advisor Value Strategies Fund
Fidelity Advisor Mid Cap Fund
Fidelity Advisor Retirement Growth Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Large Cap Fund
Fidelity Advisor Dividend Growth Fund
Fidelity Advisor Growth
Opportunities Fund

GROWTH AND INCOME FUNDS
Fidelity Advisor Growth & Income Fund
Fidelity Advisor Equity Income Fund
Fidelity Advisor Asset Allocation Fund
Fidelity Advisor Balanced Fund

TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Mortgage
Securities Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund

MUNICIPAL FUNDS
Fidelity Advisor Municipal Income Fund
Fidelity Advisor Intermediate Municipal Income Fund

MONEY MARKET FUNDS
Prime Fund
Treasury Fund
Tax-Exempt Fund

(Fidelity Logo Graphic)(registered trademark)

FIDELITY ADVISOR
ASSET ALLOCATION
FUND - INSTITUTIONAL CLASS

SEMIANNUAL REPORT
MAY 31, 1999

(Fidelity Logo Graphics)(registered trademark)

CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.

PERFORMANCE 4 How the fund has done over
time.

FUND TALK 5 The manager's review of fund
performance, strategy and
outlook.

INVESTMENT SUMMARY 8 A summary of the fund's
investments.

INVESTMENTS 9 A complete list of the fund's
investments with their
market values.

FINANCIAL STATEMENTS 22 Statements of assets and
liabilities, operations, and
changes in net assets, as
well as financial highlights.

NOTES 31 Notes to the financial
statements.

Standard & Poor's, S&P and S&P 500 are registered service marks of The
McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity
Distributors Corporation.

Other third party marks appearing herein are the property of their
respective owners.

All other marks appearing herein are registered or unregistered
trademarks or service marks of FMR Corp. or an affiliated company.

This report is printed on recycled paper using soy-based inks.

MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.

NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.

FOR MORE INFORMATION ON ANY FIDELITY ADVISOR FUND, INCLUDING CHARGES
AND EXPENSES, CONTACT YOUR INVESTMENT PROFESSIONAL FOR A FREE
PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.

PRESIDENT'S MESSAGE

(photo_of_Edward_C_Johnson_3d)

DEAR SHAREHOLDER:

While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.

Remember to contact your investment professional if you need help with
your investments.

Best regards,
Edward C. Johnson 3d

FIDELITY ADVISOR ASSET ALLOCATION FUND - INSTITUTIONAL CLASS
PERFORMANCE: THE BOTTOM LINE

CUMULATIVE TOTAL RETURNS

PERIOD ENDED MAY 31, 1999 LIFE OF FUND

FIDELITY ADV ASSET ALLOCATION 3.90%
- - INST CL

Fidelity Aggressive Composite 4.73%

S&P 500(registered trademark) 6.81%

LB Aggregate Bond -0.52%

LB 3 Month T-Bill 1.92%

CUMULATIVE TOTAL RETURNS show Institutional Class' performance in
percentage terms over a set period - in this case, since the fund
started on December 28, 1998. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare Institutional Class'
returns to the performance of the Fidelity Aggressive Asset Allocation
Composite Index, a hypothetical combination of unmanaged indices. The
composite index combines the total returns of the Standard & Poor's
500 Index, the Lehman Brothers Aggregate Bond Index and the Lehman
Brothers 3 Month Treasury Bill Index, weighted according to the fund's
neutral mix *. The benchmarks listed in the table above include
reinvested dividends and capital gains, if any, and exclude the effect
of sales charges.

AVERAGE ANNUAL TOTAL RETURNS

AVERAGE ANNUAL TOTAL RETURNS take Institutional Class shares'
cumulative return and show you what would have happened if
Institutional Class shares had performed at a constant rate each year.
These numbers will be reported once the fund is a year old. In
addition, the growth of a hypothetical $10,000 investment in the fund
will appear in the fund's next report six months from now.

* CURRENTLY 70% STOCKS, 25% BONDS AND 5% SHORT-TERM/MONEY MARKET
INSTRUMENTS.

FUND TALK: THE MANAGER'S OVERVIEW

MARKET RECAP

(photograph of Richard Habermann)

An interview with Richard Habermann, Portfolio Manager of Fidelity
Advisor Asset Allocation Fund

Q. HOW DID THE FUND PERFORM, DICK?

A. The fund commenced operations on December 28, 1998. From that date
through May 31, 1999, the fund's Institutional Class shares returned
3.90%. The Fidelity Aggressive Asset Allocation Composite Index
returned 4.73% during the same period. Going forward, we'll look at
the fund's performance in six- and 12-month intervals and compare it
to its peer group.

Q. WHAT WAS YOUR ALLOCATION STRATEGY DURING THE PERIOD AND HOW DID IT
AFFECT PERFORMANCE?

Q. HOW DID THE FUND'S STOCK SUBPORTFOLIO PERFORM DURING THE PERIOD?

Q. HOW DID THE BOND PORTION OF THE FUND FARE DURING THE PERIOD?

Q. WHAT WAS YOUR STRATEGY WITH RESPECT TO THE FUND'S SHORT-TERM/MONEY
MARKET INVESTMENTS DURING THE PERIOD?

Q. WHAT'S YOUR OUTLOOK FOR THE COMING MONTHS?

THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.