FIDELITY ADVISOR SERIES VIII, N-30D, 1996-02-20

FIDELITY ADVISOR SERIES VIII
N-30D, 1996-02-20

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(2_FIDELITY_LOGOS)FIDELITY ADVISOR

STRATEGIC OPPORTUNITIES
FUND - INSTITUTIONAL CLASS
ANNUAL REPORT
DECEMBER 31, 1995
CONTENTS

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

PERFORMANCE 4 How the fund has done over time.

FUND TALK 6 The manager's review of fund
performance, strategy and outlook.

INVESTMENT CHANGES 9 A summary of major shifts in the
fund's investments over the past six
months.

INVESTMENTS 10 A complete list of the fund's
investments with their market
values.

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

NOTES 25 Notes to the financial statements.

REPORT OF INDEPENDENT 32 The auditors' opinion.
ACCOUNTANTS

DISTRIBUTIONS 33

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

DEAR SHAREHOLDER:
Although the markets were fairly positive in 1995, no one can predict what
lies ahead for investors. The previous year, stocks posted below-average
returns and bonds had one of the worst years in history. This downturn
followed a period in which the investing environment was generally very
positive.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
If you can leave your money invested over the long term, you can avoid the
results of the volatility that generally accompanies the stock market in
the short term, as we witnessed last year. You also can help to manage some
of the risks of investing through diversification. A stock fund is already
diversified because it invests in many issues. You can diversify even
further by placing some of your money in several different types of stock
funds or in other investment categories, such as bonds.
If you have a short investment time horizon, you might want to consider
moving some of your investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
Finally, no matter what your investment horizon or portfolio diversity, it
makes good sense to follow a regular investment plan - investing a certain
amount of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
Remember to contact your investment professional if you need help with your
investments.
Best regards,
Edward C. Johnson 3d
ADVISOR STRATEGIC OPPORTUNITIES FUND - INSTITUTIONAL CLASS
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate historical performance. You can look at
the total percentage change in value, the average annual percentage change,
or the growth of a hypothetical $10,000 investment. A fund's return
includes changes in share price, plus reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells
securities that have grown in value). Initial offering of Institutional
Class shares took place on July 3, 1995, Institutional Class shares are
sold to eligible investors without a sales load or 12b-1 fee. Returns
between 12/31/83 and 8/20/86 are those of Initial Class, the original class
of the fund, returns between 8/21/86 and 6/29/95 are those of Class A and
include Class A's 0.65% 12b-1 fee. If Fidelity had not reimbursed certain
class expenses during the periods shown, the total returns would have been
lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 YEAR PAST 5 YEARS PAST 10
YEARS

Advisor Strategic Opportunities - 38.60% 115.27% 288.12%
Institutional Class

S&P 500(registered trademark) 37.58% 115.52% 300.54%

Average Capital Appreciation Fund 30.34% 125.37% 245.70%

CUMULATIVE TOTAL RETURNS show Institutional Class' performance in
percentage terms over a set period - in this case, one year, five years, or
10 years. For example, if you invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be $1,050.
You can compare Institutional Class' returns to those of the Standard &
Poor's Composite Index of 500 Stocks - a common proxy for the U.S. stock
market. To measure how Institutional Class' performance stacked up against
its peers, you can compare it to the average capital appreciation fund,
which reflects the performance of 158 capital appreciation funds with
similar objectives tracked by Lipper Analytical Services over the past 12
months. These benchmarks include reinvested dividends and capital gains, if
any, and exclude the effects of sales charges.
AVERAGE ANNUAL TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED DECEMBER 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS

Advisor Strategic Opportunities - Institutional Class 38.60% 16.57% 14.52%

S&P 500 37.58% 16.60% 14.89%

Average Capital Appreciation Fund 30.34% 16.97% 12.31%

</TABLE>

AVERAGE ANNUAL TOTAL RETURNS take the Institutional Class shares' actual
(or cumulative) return and show you what would have happened if
Institutional Class shares had performed at a constant rate each year.
$10,000 OVER 10 YEARS
FA Strat Opp Cl I (S&P 500
12/31/85 10000.00 10000.00
01/31/86 10444.77 10056.00
02/28/86 11326.91 10808.19
03/31/86 12142.33 11411.29
04/30/86 11934.77 11282.34
05/31/86 12171.98 11882.56
06/30/86 12824.31 12083.37
07/31/86 12416.60 11407.91
08/31/86 13254.26 12254.38
09/30/86 12386.95 11240.94
10/31/86 12868.79 11889.55
11/30/86 13068.23 12178.46
12/31/86 12792.03 11867.91
01/31/87 13841.59 13466.52
02/28/87 13983.63 13998.45
03/31/87 14393.99 14403.00
04/30/87 13967.85 14274.81
05/31/87 14102.01 14399.01
06/30/87 14543.93 15126.15
07/31/87 15127.89 15893.05
08/31/87 15427.77 16485.86
09/30/87 15041.09 16124.82
10/31/87 12279.08 12651.53
11/30/87 11718.79 11609.05
12/31/87 11981.81 12492.50
01/31/88 12920.47 13018.43
02/29/88 13343.79 13625.09
03/31/88 13132.13 13204.07
04/30/88 13214.96 13350.64
05/31/88 13445.02 13466.79
06/30/88 14365.28 14084.92
07/31/88 14282.46 14031.39
08/31/88 13840.73 13554.33
09/30/88 14291.66 14131.74
10/31/88 14540.13 14524.60
11/30/88 14632.16 14316.90
12/31/88 14647.56 14567.45
01/31/89 15477.21 15633.78
02/28/89 15410.46 15244.50
03/31/89 15734.69 15599.70
04/30/89 16335.46 16409.32
05/31/89 17088.82 17073.90
06/30/89 17222.33 16976.58
07/31/89 18404.81 18509.57
08/31/89 18643.22 18872.35
09/30/89 18643.22 18794.98
10/31/89 18338.06 18358.93
11/30/89 18833.94 18733.46
12/31/89 19422.35 19183.06
01/31/90 18137.99 17895.87
02/28/90 18236.03 18126.73
03/31/90 18236.03 18607.09
04/30/90 17490.90 18141.91
05/31/90 18059.55 19910.75
06/30/90 18236.03 19775.36
07/31/90 18285.05 19712.07
08/31/90 17000.69 17930.10
09/30/90 16873.23 17056.91
10/31/90 16863.43 16983.56
11/30/90 17608.55 18080.70
12/31/90 18029.72 18585.15
01/31/91 18612.32 19395.46
02/28/91 19726.40 20782.24
03/31/91 20349.87 21285.17
04/30/91 20625.84 21336.26
05/31/91 21361.75 22257.98
06/30/91 20687.17 21238.57
07/31/91 21310.64 22228.28
08/31/91 21770.58 22755.09
09/30/91 21852.35 22375.08
10/31/91 21412.85 22674.91
11/30/91 20891.58 21761.11
12/31/91 22190.85 24250.58
01/31/92 22226.85 23799.52
02/29/92 22658.91 24108.91
03/31/92 22082.83 23638.79
04/30/92 22502.89 24333.77
05/31/92 23234.98 24453.01
06/30/92 23234.98 24088.66
07/31/92 23955.08 25073.88
08/31/92 23535.02 24559.87
09/30/92 23439.01 24849.67
10/31/92 23631.03 24936.65
11/30/92 24639.16 25786.99
12/31/92 25047.37 26104.17
01/31/93 25520.71 26323.44
02/28/93 26243.86 26681.44
03/31/93 27059.05 27244.42
04/30/93 26519.97 26585.11
05/31/93 27137.94 27297.59
06/30/93 27361.46 27376.75
07/31/93 27939.98 27267.24
08/31/93 29688.69 28300.67
09/30/93 29609.80 28082.76
10/31/93 30543.33 28664.07
11/30/93 29254.80 28391.76
12/31/93 30166.09 28735.30
01/31/94 30427.15 29712.30
02/28/94 29339.43 28907.10
03/31/94 28208.20 27646.75
04/30/94 28440.25 28000.63
05/31/94 28498.26 28459.84
06/30/94 28498.26 27762.57
07/31/94 29179.89 28673.18
08/31/94 29353.93 29848.78
09/30/94 28947.85 29117.49
10/31/94 28643.29 29772.63
11/30/94 27758.61 28688.31
12/31/94 28003.27 29113.76
01/31/95 29246.19 29868.68
02/28/95 29994.95 31032.66
03/31/95 30279.47 31948.44
04/30/95 30938.37 32889.32
05/31/95 31747.02 34203.90
06/30/95 33409.25 34998.46
07/31/95 34562.32 36159.01
08/31/95 35565.65 36249.77
09/30/95 36808.57 37779.51
10/31/95 36673.80 37644.64
11/30/95 37677.13 39297.24
12/29/95 38812.28 40054.10

$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity Advisor
Strategic Opportunities Fund - Institutional Class on December 31, 1985. As
the chart shows, by December 31, 1995, the value of your investment would
have grown to $38,812 - a 288.12% increase on your initial investment. For
comparison, look at how the S&P 500 did over the same period. With
dividends reinvested, the same $10,000 investment would have grown to
$40,054 - a 300.54% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW

MARKET RECAP
Strong corporate earnings and a
favorable interest rate
environment helped the U.S.
stock market post robust returns
for the 12 months ended
December 31, 1995. The Standard
& Poor's Composite Index of 500
Stocks finished the 12-month
period with a total return of
37.58% (including reinvested
dividends ) - well above its
historical annual average of
roughly 12%. With inflation
posing little threat, interest rates
fell during the first half of 1995.
The Federal Reserve Board cut
the fed funds rate - the rate
banks charge each other for
overnight loans - twice, in July
and December.
Large-capitalization stocks led
the rally, with the weak dollar
helping to bolster overseas
business. Technology companies
posted the strongest earnings
growth and stock price gain,
although they faltered somewhat
in the fourth quarter. Lower
interest rates and continued
merger and acquisition activity
helped financial stocks perform
well. In November, the Dow Jones
Industrial Average closed above
5000 for the first time. Returns
from foreign markets suffered as
investors brought capital back to
the U.S. The Morgan Stanley
Emerging Markets Free Index
was down 5.21% for the 12
months ended December 31. The
Morgan Stanley EAFE (Europe,
Australasia, Far East) Index was
up 11.21% for the year. European
markets fared well through 1995,
while the Japanese market
recently has shown signs of
recovery.
An interview with Daniel R. Frank Portfolio Manager of Fidelity Advisor
Strategic Opportunities Fund
Q. DAN, HOW DID THE FUND PERFORM OVER THE PAST 12 MONTHS?
A. The fund performed well, with Institutional Class shares returning
38.60% during the year ended December 31, 1995. During the same period, the
average capital appreciation fund returned 30.34%, according to Lipper
Analytical Services.
Q. THE PAST YEAR'S MARKET SUCCESS WAS LED, TO A GREAT DEGREE, BY TECHNOLOGY
STOCKS. SINCE YOUR TECHNOLOGY HOLDINGS WERE NEGLIGIBLE DURING THE PERIOD,
WHAT FACTORS CONTRIBUTED TO THE FUND'S PERFORMANCE?
A. The story is nearly identical to our discussion in the semiannual report
at the end of June. In short, it's the three "Bs" - the Bells, banks and
bonds. The regional Bell operating companies (RBOCs) were spectacular,
standing as one of the best-performing sectors in the market last year.
Regional banks were one of the top performing sectors, as well. Also,
interest rates continued to come down, helping the long-term Treasury
position. Zero coupon bonds - which tend to be extremely sensitive to
changes in interest rates - were the fund's largest holding as of the end
of the period and outperformed the S&P 500.
Q. ALMOST ONE QUARTER OF THE FUND'S HOLDINGS WAS RBOCS - ABOUT THE SAME AS
SIX MONTHS AGO. THEIR PERFORMANCE CONTINUED TO BE SUPERIOR . . .
A. Nothing really has changed. BellSouth, Ameritech, Bell Atlantic, NYNEX
and SBC Communications remain among the fund's 10 largest holdings.
Revenue, earnings and dividend growth continued to be strong. Legislation
at the state levels continued to be favorable. Federal legislation, though
still pending, may help to allow the RBOCs to get into the long-distance
business while de-regulating the rest of their business. You have a
combination of continued growth in phone lines and such enhanced services
as voice mail, as well as increasing returns from the cellular and overseas
components of their operations. Further, by default, the RBOCs are the
Internet access providers. By this I mean that as people log-in to the
information superhighway, they're adding second and third phone lines at
home. Over the past decade, the total return from the RBOCs has been
substantially more than the S&P 500.
Q. ON THE OTHER HAND, YOU TRIMMED THE FUND'S HOLDING IN FINANCIAL SERVICES
ALMOST IN HALF - TO 14%. WHY?
A. If you look at the fund's history in recent years, you'll see that at
different times I've held big positions in this sector and also have had
less than 10% of the fund's holdings in financial services. Banks, for
example, tend to do well when interest rates come down. The underlying
fundamentals of their loan portfolios, however, had me nervous at the end
of the period. Consumer credit quality has been deteriorating and there has
been no loan growth. Banks have not performed well in the past when faced
with similar conditions.
Q. YOU INCREASED THE FUND'S HOLDINGS IN THE MEDIA AND LEISURE SECTOR. WHAT
DID YOU SEE THAT MADE THIS MARKET SEGMENT ATTRACTIVE?
A. The holdings in this sector during the period were mostly newspapers - a
new story for the fund - with a lot of new names added. These new holdings
included Gannett, Knight-Ridder and News Corp. These stocks have done
little over the past decade and have had their earnings depressed by the
dramatic rise in newsprint prices over the past three years. Many of these
companies generate substantial excess cash which has been and can continue
to be used to benefit shareholders. Icing on the cake would be a decline in
newsprint prices.
Q. WERE THERE ANY DISAPPOINTMENTS DURING THE PERIOD?
A. Going into 1995, I probably would have been happy with a return of 10%.
Still, Viacom, which was one of the fund's top holdings during the period
was a disappointment, particularly given its sizable assets, strong cash
flow and improving balance sheet. Kinder-Care Learning Centers, a provider
of day care services which the fund no longer held at the end of the
period, was another disappointment.
Q. WHAT'S YOUR STRATEGY GOING FORWARD?
A. It's extremely difficult to make accurate predictions about the future
of the securities markets. I think the market's performance during 1995 -
surpassing just about everyone's expectations - is perfect evidence of
that. As always, however, I will continue to seek out and invest in those
companies and market sectors where I believe there is value and the
opportunity for capital appreciation.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.

FUND FACTS
GOAL: seeks capital
appreciation by investing
primarily in securities of
companies believed by
Fidelity to involve a "Special
Situation"
START DATE: December 31, 1983
SIZE: as of December 31,
1995, more than $751 million
MANAGER: Daniel R. Frank,
since inception; joined Fidelity
in 1979
(checkmark)
DAN FRANK ON HIS INVESTMENT
PHILOSOPHY:
"My philosophy really hasn't
changed in the 12 years I've
been managing this fund. I try
to find great businesses that
generate significant surplus
cash which can then be
redeployed to enhance
stockholder returns. At the
same time, I look for unique
opportunities that might not
meet those criteria. I also look
for the big industry trends.
These might include, for
example, the decline in
semiconductor prices or
dramatic changes in supply and
demand in a particular
industry, such as with
newsprint, steel, paper, oil
and others.
"I try to gather information
from as many sources as
possible. Fidelity provides us
with the resources to take
advantage of outside
research services and
consultants. I travel a great
deal to visit different
companies and countries. In
addition, I use proprietary
in-house research, I read
every newspaper I can, and I
apply common sense."
INVESTMENT CHANGES

TOP TEN STOCKS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

BellSouth Corp. 5.4 5.1

Ameritech Corp. 5.1 5.0

Bell Atlantic Corp. 4.9 4.9

I-Stat Corp. 4.7 7.2

NYNEX Corp. 4.6 4.3

SBC Communications, Inc. 4.4 4.7

Viacom, Inc. (various issues) 4.3 5.3

Philip Morris Companies, Inc. 2.3 0.0

Tootsie Roll Industries, Inc. 1.7 1.5

Regis Corp. 1.2 1.4

TOP FIVE MARKET SECTORS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET SECTORS
6 MONTHS AGO

Utilities 25.9 26.0

Finance 14.0 24.4

Media & Leisure 8.8 6.0

Nondurables 8.8 4.5

Health 6.0 10.6

ASSET ALLOCATION
AS OF DECEMBER 31, 1995 * AS OF JUNE 30, 1995 **
Row: 1, Col: 1, Value: 5.2
Row: 1, Col: 2, Value: 26.0
Row: 1, Col: 3, Value: 34.4
Row: 1, Col: 4, Value: 34.4
Row: 1, Col: 1, Value: 2.0
Row: 1, Col: 2, Value: 22.0
Row: 1, Col: 3, Value: 36.0
Row: 1, Col: 4, Value: 40.0
Stocks 68.7%
Bonds 26.1%
Short-term
investments 5.2%
FOREIGN
INVESTMENTS 3.2%
Stocks 77.3%
Bonds 22.2%
Short-term
investments 0.5%
FOREIGN
INVESTMENTS 2.4%
*
**
INVESTMENTS DECEMBER 31, 1995

Showing Percentage of Total Value of Investments in Securities

COMMON STOCKS - 68.7%
SHARES VALUE (NOTE 1)
AEROSPACE & DEFENSE - 0.7%
Lockheed Martin Corp. 67,000 $ 5,293,000
BASIC INDUSTRIES - 0.9%
CHEMICALS & PLASTICS - 0.9%
Great Lakes Chemical Corp. 50,000 3,600,000
Minnesota Mining & Manufacturing Co. 30,000 1,987,500
Rohm & Haas Co. 20,000 1,287,500
6,875,000
CONSTRUCTION & REAL ESTATE - 0.0%
CONSTRUCTION - 0.0%
Emcor Group, Inc. (a):
Series X (warrants) 148,822 55,808
Series Y (warrants) 148,822 37,206
93,014
DURABLES - 0.1%
AUTOS, TIRES, & ACCESSORIES - 0.1%
General Motors Corp. 10,000 528,750
ENERGY - 0.9%
ENERGY SERVICES - 0.7%
Baker Hughes, Inc. 60,000 1,462,500
Dresser Industries, Inc. 40,000 975,000
Schlumberger Ltd. 44,300 3,067,775
5,505,275
OIL & GAS - 0.2%
Total SA sponsored ADR 40,000 1,360,000
TOTAL ENERGY 6,865,275
FINANCE - 14.0%
BANKS - 4.6%
Banc One Corp. 35,000 1,321,250
Carolina First Corp. 40,375 706,563
Central Fidelity Banks, Inc. 25,000 800,000
Citizens Bancorp of Maryland 40,000 1,290,000
F & M Bancorporation, Inc. 21,500 559,000
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
FINANCE - CONTINUED
BANKS - CONTINUED
F & M National Corp. 69,000 $ 1,380,000
Financial Trust Corp. 30,000 907,500
First Citizens Bancshares, Inc. 30,000 1,653,750
First Midwest Bankcorp, Inc. 25,000 721,875
First Virginia Banks, Inc. 15,100 630,425
Firstmerit Corp. 70,000 2,100,000
Fort Wayne National Corp. 30,000 945,000
Jefferson Bankshares, Inc. 100,000 2,025,000
Keystone Financial, Inc. 65,000 1,950,000
National Australia Bank Ltd. ADR 30,900 1,398,225
Northeast Indiana Bancorp, Inc. 75,000 900,000
ONBANCorp, Inc. 60,000 2,002,500
PNC Financial Corp. 175,000 5,643,750
Pikeville National Corp. 32,500 625,625
River Forest Bancorp 64,000 1,632,000
TF Financial Corp. 50,000 750,000
Trans Financial Bancorp, Inc. 70,000 1,251,250
Union Planters Corp. 546 17,404
United Bankshares, Inc. 58,000 1,696,500
Wilmington Trust Corp. 50,000 1,543,750
34,451,367
CREDIT & OTHER FINANCE - 0.4%
HFNC Financial Corp. 60,000 795,000
Harbor Federal Bancorp, Inc. 58,000 841,000
Life Bancorp, Inc. 79,000 1,185,000
2,821,000
FEDERAL SPONSORED CREDIT - 0.6%
Student Loan Marketing Association 65,000 4,281,875
INSURANCE - 4.0%
AFLAC, Inc. 50,000 2,168,750
Allstate Corp. 110,000 4,523,750
Chubb Corp. (The) 40,700 3,937,725
Conseco, Inc. 11,300 697,176
Lincoln National Corp. 75,000 4,031,250
Marsh & McLennan Companies, Inc. 37,200 3,301,500
Torchmark Corp. 114,900 5,199,225
UNUM Corp. 110,000 6,050,000
29,909,376
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
FINANCE - CONTINUED
SAVINGS & LOANS - 4.3%
American Federal Bank 110,000 $ 1,677,500
Avondale Financial Corp. (a) 65,000 942,500
Bedford Bancshares, Inc. 36,000 621,000
Cameron Financial Corp. 42,000 603,750
Coastal Bancorp, Inc. 105,000 1,837,500
Damen Financial Corp. (a) 100,000 1,137,500
FFVA Financial Corp. 52,000 1,430,000
Fidelity Financial Bankshares Corp. 10,000 138,750
First Bell Bancorp, Inc. (a) 100,000 1,337,500
First Federal Capital Corp. 40,000 720,000
First Defiance Financial Corp. 65,000 658,125
First Financial Holdings, Inc. 105,000 2,021,250
First Northern Capital Corp. 30,000 495,000
First Southeast Financial Corp. 85,000 1,615,000
Fort Thomas Financial Corp. 70,000 848,750
Frankfort First Bancorp, Inc. 60,000 795,000
HMN Financial, Inc. (a) 130,000 2,080,000
Harris Savings Bank 43,000 860,000
Home Federal Bancorp 49,000 1,298,500
Industrial Bancorp, Inc. 60,000 825,000
Leader Financial Corp. 55,000 2,055,625
Maryland Federal Bancorp, Inc. 40,000 1,200,000
Pennfed Financial Services, Inc. (a) 110,000 1,622,500
Pennfirst Bancorp, Inc. 15,000 202,500
Piedmont Bancorp, Inc. (a) 36,800 460,000
Pocahontas Federal Saving And Loan Association 43,000 682,625
Sho-Me Financial Corp. (a) 40,000 600,000
Trenton Savings Bank FSB 70,000 910,000
Troy Hill Bancorp, Inc. 50,000 650,000
Virginia First Financial Corp. 68,000 773,500
York Financial Corp. 70,000 1,181,250
32,280,625
SECURITIES INDUSTRY - 0.1%
John Nuveen Co. Class A 50,000 1,237,500
TOTAL FINANCE 104,981,743
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
HEALTH - 6.0%
DRUGS & PHARMACEUTICALS - 0.7%
Sepracor, Inc. (a) 300,000 $ 5,512,500
MEDICAL EQUIPMENT & SUPPLIES - 5.1%
Corvita Corp. (a) 245,000 2,541,875
I-Stat Corp. (a)(e) 1,093,100 35,525,750
38,067,625
MEDICAL FACILITIES MANAGEMENT - 0.2%
Spectral Diagnostics, Inc. (a) 200,000 1,594,166
TOTAL HEALTH 45,174,291
HOLDING COMPANIES - 0.2%
Shell Transport & Trading PLC 20,000 1,627,500
INDUSTRIAL MACHINERY & EQUIPMENT - 0.1%
ELECTRICAL EQUIPMENT - 0.1%
ACTV, Inc. (a) 250,000 937,500
MEDIA & LEISURE - 8.8%
BROADCASTING - 4.9%
Gaylord Entertainment Co. Class A 110,000 3,052,500
Grupo Televisa SA de CV sponsored ADR 40,000 900,000
Starsight Telecast, Inc. (a) 100,000 487,500
Viacom, Inc. (a):
Class B (Class C warrants) 1,100,000 3,162,500
Class B (Class E warrants) 350,000 1,925,000
Class B (non-vtg.) 570,000 27,003,750
36,531,250
LEISURE DURABLES & TOYS - 0.1%
Harley Davidson, Inc. 30,000 862,500
PUBLISHING - 3.7%
Dow Jones & Co., Inc. 70,000 2,791,250
Dun & Bradstreet Corp. 30,000 1,942,500
Gannett Co., Inc. 70,000 4,296,250
Knight-Ridder, Inc. 70,000 4,375,000
McGraw-Hill, Inc. 84,500 7,362,063
New York Times Co. (The) Class A 46,400 1,374,600
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
MEDIA & LEISURE - CONTINUED
PUBLISHING - CONTINUED
News Corp. Ltd. ADR 75,000 $ 1,603,125
Reader's Digest Association, Inc. (The) Class A (non-vtg.) 10,000 512,500
Tribune Co. 60,000 3,667,500
27,924,788
RESTAURANTS - 0.1%
Luby's Cafeterias, Inc. 45,000 1,001,250
TOTAL MEDIA & LEISURE 66,319,788
NONDURABLES - 8.8%
BEVERAGES - 0.7%
Buenos Aires Embotelladora SA sponsored ADR 35,000 721,875
Cadbury Schweppes PLC ADR Ord. 85,000 2,826,250
Coca-Cola Femsa SA de CV sponsored ADR 40,000 740,000
Panamerican Beverages, Inc. Class A 42,100 1,347,200
5,635,325
FOODS - 2.5%
General Mills, Inc. 30,000 1,732,500
Tootsie Roll Industries, Inc. 325,000 12,878,125
Tyson Foods, Inc. 80,000 2,090,000
Wrigley (Wm.) Jr. Company 35,000 1,837,500
18,538,125
HOUSEHOLD PRODUCTS - 1.9%
Colgate-Palmolive Co. 20,000 1,405,000
First Brands Corp. 180,000 8,572,500
Unilever PLC ADR 53,000 4,478,500
14,456,000
TOBACCO - 3.7%
American Brands, Inc. 40,000 1,785,000
BAT Industries PLC sponsored ADR 145,000 2,646,250
Philip Morris Companies, Inc. 190,000 17,195,000
RJR Nabisco Holdings Corp. 60,000 1,852,500
UST, Inc. 120,000 4,005,000
27,483,750
TOTAL NONDURABLES 66,113,200
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
SERVICES - 1.2%
Regis Corp. 390,000 $ 9,360,000
TECHNOLOGY - 0.7%
COMPUTERS & OFFICE EQUIPMENT - 0.7%
Pitney Bowes, Inc. 105,000 4,935,000
TRANSPORTATION - 0.4%
RAILROADS - 0.4%
Union Pacific Corp. 50,000 3,300,000
UTILITIES - 25.9%
TELEPHONE SERVICES - 25.9%
Ameritech Corp. 650,000 38,350,000
Bell Atlantic Corp. 550,000 36,781,250
BellSouth Corp. 940,000 40,890,000
NYNEX Corp. 645,000 34,830,000
Pacific Telesis Group 130,000 4,371,250
SBC Communications, Inc. 570,000 32,775,000
Southern New England Telecommunications Corp. 170,000 6,757,500
194,755,000
TOTAL COMMON STOCKS
(Cost $418,769,949) 517,159,061
CONVERTIBLE BONDS - 0.2%
MOODY'S RATINGS PRINCIPAL
(UNAUDITED) AMOUNT (C)
CONSTRUCTION & REAL ESTATE - 0.2%
REAL ESTATE INVESTMENT TRUSTS - 0.2%
Rockefeller Center Properties, Inc. 0%, 12/31/00 (b)
(Cost $1,154,491) - $ 2,000,000 1,140,000
U.S. TREASURY OBLIGATIONS - 25.3%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) AMOUNT (C) (NOTE 1)
9 1/8%, 5/15/18 Aaa $ 20,000,000 $ 27,453,120
Stripped Interest Payment 0%:
2/15/00 Aaa 25,000,000 20,129,250
2/15/12 Aaa 300,000,000 113,352,000
Stripped Principal 0%:
2/15/15 Aaa 50,000,000 15,472,500
2/15/17 Aaa 50,000,000 13,504,500
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $159,557,711) 189,911,370
FOREIGN GOVERNMENT OBLIGATIONS - 0.6%
France Government (d)
OAT Strip, 4/25/23 Aaa FRF 100,000 2,479,486
Principal Strip, 4/25/23 Aaa FRF 90,000 2,237,186
TOTAL FOREIGN GOVERNMENT OBLIGATIONS
(Cost $4,941,468) 4,716,672
REPURCHASE AGREEMENTS - 5.2%
MATURITY
AMOUNT
Investments in repurchase agreements
(U.S. Treasury obligations) in a joint
trading account at 5.88% dated
12/29/95 due 1/2/96 $ 39,439,750 39,414,000
TOTAL INVESTMENT IN SECURITIES - 100.0%
(Cost $623,837,619) $ 752,341,103
CURRENCY ABBREVIATIONS
FRF - French franc
LEGEND
1. Non-income producing
2. Non-income producing - issuer filed for protection under the Federal
Bankruptcy Code or is in default of interest payment.
3. Principal amount is stated in United States dollars unless otherwise
noted.
4. Principal amount in thousands.
5. Affiliated company (see Note 8 of Notes to Financial Statements).
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 25.9% AAA, AA, A 25.9%
Baa 0.0% BBB 0.0%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
For some foreign government obligations, FMR has assigned the ratings of
the sovereign credit of the issuing government. The percentage not rated by
either S&P or Moody's amounted to 0.2%
INCOME TAX INFORMATION
At December 31, 1995, the aggregate cost of investment securities for
income tax purposes was $624,506,301. Net unrealized appreci- ation
aggregated $127,834,802, of which $134,027,919 related to appreciated
invest- ment securities and $6,193,117 related to depreciated investment
securities.
The fund hereby designates $1,312,971 as a capital gain dividend for the
purpose of the dividend paid deduction.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS DECEMBER 31, 1995

Investment in securities, at value (including repurchase $ 752,341,103
agreements of $39,414,000) (cost $623,837,619) -
See accompanying schedule

Cash 1,667

Receivable for investments sold 12,075,751

Receivable for fund shares sold 6,699,232

Dividends receivable 1,256,090

Interest receivable 230,632

Other receivables 101,210

Prepaid expenses 8,975

TOTAL ASSETS 772,714,660

LIABILITIES

Payable for investments purchased $ 15,531,409

Payable for fund shares redeemed 443,369

Distributions payable 4,222,435

Accrued management fee 375,779

Distribution fees payable 409,732

Other payables and accrued expenses 315,934

TOTAL LIABILITIES 21,298,658

NET ASSETS $ 751,416,002

Net Assets consist of: $ 609,715,457
Paid in capital

Accumulated undistributed net realized gain (loss) on 13,197,061
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 128,503,484
investments

NET ASSETS $ 751,416,002

CALCULATION OF MAXIMUM OFFERING PRICE $24.88
CLASS A:
NET ASSET VALUE, and redemption price per share
($619,992,880 (divided by) 24,920,869 shares)

Maximum offering price per share (100/95.25 of $24.88) $26.12

CLASS B: $24.56
NET ASSET VALUE, offering price and redemption price
per share ($87,565,658 (divided by) 3,565,455 shares) A

INSTITUTIONAL CLASS: $24.80
NET ASSET VALUE, offering price and redemption price
per share ($20,429,118 (divided by) 823,752 shares)

INITIAL CLASS: $25.10
NET ASSET VALUE and redemption price per share
($23,428,346 (divided by) 933,228 shares)

Maximum offering price per share (100/95.25 of $25.10) $26.35

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME YEAR ENDED DECEMBER 31, 1995

Dividends $ 11,406,495

Interest 8,282,971

TOTAL INCOME 19,689,466

EXPENSES

Management fee $ 3,419,543
Basic fee

Performance adjustment 91,269

Transfer agent fees 1,162,980
Class A

Class B 126,686

Institutional Class 4,398

Initial Class 44,511

Distribution fees - Class A 3,182,013

Distribution fees - Class B 467,105

Accounting fees and expenses 315,623

Non-interested trustees' compensation 3,060

Custodian fees and expenses 42,292

Registration fees - Class A 76,078

Registration fees - Class B 61,368

Registration fees - Institutional Class 17,791

Registration fees - Initial Class 23,362

Audit 37,973

Legal 31,273

Interest 948

Reports to shareholders 29,651

Miscellaneous 2,006

Total expenses before reductions 9,139,930

Expense reductions (38,211) 9,101,719

NET INVESTMENT INCOME 10,587,747

REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:

Investment securities (including realized loss of 36,075,671
$246,335 on sales of investment in affiliated issuers)

Foreign currency transactions (11,657) 36,064,014

Change in net unrealized appreciation (depreciation) on:

Investment securities 132,488,727

Assets and liabilities in foreign currencies 10,596 132,499,323

NET GAIN (LOSS) 168,563,337

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 179,151,084
OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
YEAR ENDED THREE MONTHS YEAR ENDED
DECEMBER 31, ENDED SEPTEMBER 30,
1995 DECEMBER 31, 1994
1994

INCREASE (DECREASE) IN NET ASSETS

Operations $ 10,587,747 $ 2,067,920 $ 6,903,469
Net investment income

Net realized gain (loss) 36,064,014 (5,789,778) 8,280,193

Change in net unrealized appreciation 132,499,323 (9,641,386) (23,325,658)
(depreciation)

NET INCREASE (DECREASE) IN NET ASSETS 179,151,084 (13,363,244) (8,141,996)
RESULTING FROM OPERATIONS

Distributions to shareholders (9,290,408) (6,826,359) (5,752,632)
From net investment income
Class A

Class B (1,281,036) (382,214) -

Institutional Class (433,848) - -

Initial Class (449,705) (464,141) (458,027)

From net realized gain (13,102,251) (5,071,018) (22,876,692)
Class A

Class B (1,854,130) (211,573) -

Institutional Class (433,848) - -

Initial Class (494,507) (241,353) (1,535,740)

TOTAL DISTRIBUTIONS (27,339,733) (13,196,658) (30,623,091)

Share transactions - net increase 189,241,269 23,899,770 161,198,427
(decrease)

TOTAL INCREASE (DECREASE) IN NET ASSETS 341,052,620 (2,660,132) 122,433,340

NET ASSETS

Beginning of period 410,363,382 413,023,514 290,590,174

End of period (including undistributed $ 751,416,002 $ 410,363,382 $ 413,023,514
net investment income of $0,
$0, and $5,875,182 respectively)

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS A YEAR ENDED THREE MONTHS YEARS ENDED SEPTEMBER 30,
DECEMBER 31, ENDED
DECEMBER 31,

SELECTED PER-SHARE DATA 1995 1994 1994 G 1993 1992 D 1991

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 18.70 $ 19.96 $ 22.52 $ 19.53 $ 21.38 $ 17.21

Income from Investment Operations

Net investment income .39 .10 F .39 F .33 .61 .66

Net realized and unrealized gain (loss) 6.73 (.75) (.81) 4.44 .58 4.26

Total from investment operations 7.12 (.65) (.42) 4.77 1.19 4.92

Less Distributions

From net investment income (.39) (.35) (.43) (.57) (.62) (.75)

From net realized gain (.55) (.26) (1.71) (1.21) (2.42) -

Total distributions (.94) (.61) (2.14) (1.78) (3.04) (.75)

Net asset value, end of period $ 24.88 $ 18.70 $ 19.96 $ 22.52 $ 19.53 $ 21.38

TOTAL RETURN B, C 38.16% (3.26)% (2.24)% 26.33% 7.26% 29.51%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 619,993 $ 375,691 $ 385,349 $ 269,833 $ 194,710 $ 199,604

Ratio of expenses to average net assets 1.61% 1.73% A, 1.85% 1.57% 1.46% 1.56%
H E

Ratio of expenses to average net assets after expense
reductions 1.61% I 1.73% A, 1.84% 1.57% 1.46% 1.56%
I I

Ratio of net investment income to average net assets 1.90% 2.03% A 1.89% 2.06% 3.22% 3.61%

Portfolio turnover 142% 228% A 159% 183% 211% 223%

</TABLE>

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO FINANCIAL
STATEMENTS).
D AS OF OCTOBER 1, 1991 THE FUND DISCONTINUED THE USE OF EQUALIZATION
ACCOUNTING.
E INCLUDES REIMBURSEMENT OF $.03 PER SHARE FROM FIDELITY MANAGEMENT &
RESEARCH COMPANY FOR ADJUSTMENTS TO PRIOR PERIOD'S FEES.
F NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
G EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
H FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT THE CLASS' EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
I FMR HAS DIRECTED CERTAIN PORTFOLIO TRADES TO BROKERS WHO PAID A PORTION
OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
FINANCIAL HIGHLIGHTS - CLASS B

<TABLE>
<CAPTION>
<S> <C> <C> <C>
YEAR ENDED THREE YEAR ENDED
DECEMBER MONTHS SEPTEMBER
31, ENDED 30,
DECEMBER
31,

1995 1994 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 18.57 $ 19.98 $ 19.65

Income from Investment Operations

Net investment income .38 .06 E .05 E

Net realized and unrealized gain (loss) 6.54 (.74) .28

Total from investment operations 6.92 (.68) .33

Less Distributions

From net investment income (.38) (.47) -

From net realized gain (.55) (.26) -

Total distributions (.93) (.73) -

Net asset value, end of period $ 24.56 $ 18.57 $ 19.98

TOTAL RETURN B, C 37.35% (3.41)% 1.68%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 87,566 $ 17,090 $ 8,824

Ratio of expenses to average net assets 2.11% 2.58% A 2.63% A,
G

Ratio of expenses to average net assets after 2.10% F 2.53% A, 2.63% A
expense reductions F

Ratio of net investment income to average net 1.40% 1.22% A 1.11% A
assets

Portfolio turnover 142% 228% A 159%

</TABLE>

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO FINANCIAL
STATEMENTS).
D FOR THE PERIOD JUNE 30, 1994 (COMMENCEMENT OF SALES OF CLASS B SHARES) TO
SEPTEMBER 30, 1994.
E NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
F FMR HAS DIRECTED CERTAIN PORTFOLIO TRADES TO BROKERS WHO PAID A PORTION
OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
G FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT THE CLASS' EXPENSE RATIO
WOULD HAVE BEEN HIGHER.

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - INITIAL CLASS YEAR ENDED THREE MONTHS YEARS ENDED SEPTEMBER 30,
DECEMBER 31, ENDED
DECEMBER 31,

SELECTED PER-SHARE DATA 1995 1994 1994 G 1993 1992 D 1991

</TABLE>

Net asset value, beginning of period $ 18.86 $ 20.23 $ 22.72 $ 19.72 $ 21.55 $ 17.37

Income from Investment Operations

Net investment income .50 .13 F .54 F .45 .73 .77

Net realized and unrealized gain (loss) 6.79 (.74) (.81) 4.46 .58 4.26

Total from investment operations 7.29 (.61) (.27) 4.91 1.31 5.03

Less Distributions

From net investment income (.50) (.50) (.51) (.70) (.72) (.85)

From net realized gain (.55) (.26) (1.71) (1.21) (2.42) -

Total distributions (1.05) (.76) (2.22) (1.91) (3.14) (.85)

Net asset value, end of period $ 25.10 $ 18.86 $ 20.23 $ 22.72 $ 19.72 $ 21.55

TOTAL RETURN B, C 38.75% (3.02)% (1.51)% 26.98% 7.89% 30.01%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 23,428 $ 17,583 $ 18,850 $ 20,707 $ 17,933 $ 19,193

Ratio of expenses to average net assets 1.04% 1.14% A 1.15% .89% .87% 1.00%

Ratio of expenses to average net assets after expense reductions 1.03% 1.11% A, 1.14% .89% .87% 1.00%

H H H

Ratio of net investment income to average net assets 2.47% 2.65% A 2.6% 2.74% 3.78% 4.12%

Portfolio turnover 142% 228% A 159% 183% 211% 223%

</TABLE>

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO FINANCIAL
STATEMENTS).
D AS OF OCTOBER 1, 1991 THE FUND DISCONTINUED THE USE OF EQUALIZATION
ACCOUNTING.
E INCLUDES REIMBURSEMENT OF $.03 PER SHARE FROM FIDELITY MANAGEMENT &
RESEARCH COMPANY FOR ADJUSTMENTS TO PRIOR PERIOD'S FEES.
F NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
G EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
H FMR HAS DIRECTED CERTAIN PORTFOLIO TRADES TO BROKERS WHO PAID A PORTION
OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS

<TABLE>
<CAPTION>
<S> <C>
YEAR ENDED
DECEMBER 31,

1995 B

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 22.35

Income from Investment Operations

Net investment income .55

Net realized and unrealized gain (loss) 3.00

Total from investment operations 3.55

Less Distributions

From net investment income (.55)

From net realized gain (.55)

Total distributions (1.10)

Net asset value, end of period $ 24.80

TOTAL RETURN C, D 15.96%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 20,429

Ratio of expenses to average net assets .97% A

Ratio of expenses to average net assets after expense reductions .96% A,
E

Ratio of net investment income to average net assets 2.55% A

Portfolio turnover 142%

</TABLE>

A ANNUALIZED
B FOR THE PERIOD JULY 3, 1995 (COMMENCEMENT OF SALE OF INSTITUTIONAL CLASS
SHARES) TO DECEMBER 31, 1995.
C TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANUALIZED.
D TOTAL RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIOD SHOWN (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
E FMR HAS DIRECTED CERTAIN PORTFOLIO TRADES TO BROKERS WHO PAID A PORTION
OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
NOTES TO FINANCIAL STATEMENTS
For the period ended December 31, 1995

1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Advisor Strategic Opportunities (the fund) is a fund of Fidelity
Advisor Series VIII (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 B, Initial 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 its distribution plan.
The fund commenced sale of Institutional Class shares on July 3, 1995.
Investment income, realized and unrealized capital gains and losses, and
the common expenses of the fund 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, registration, and certain other
class-specific fees and expenses.
The following summarizes the significant accounting policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are readily
available are valued at the last sale price, or if no sale price, at the
closing bid price. Securities for which exchange quotations are not readily
available (and in certain cases debt securities which trade on an exchange)
are valued primarily using dealer-supplied valuations or at their fair
value as determined in good faith under consistently applied procedures
under the general supervision of the Board of Trustees. Short-term
securities maturing within sixty days of their purchase date are valued at
amortized cost or original cost plus accrued interest, both of which
approximate current value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Purchases and
sales of securities, income receipts, and expense payments are translated
into U.S. dollars at the prevailing exchange rate on the respective dates
of the transactions.
Net realized gains and losses on foreign currency transactions represent
net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, currency gains and losses
realized between the trade and settlement dates on securities transactions,
and the difference between the amount of net investment income accrued and
the U.S. dollar amount actually received. The effects of changes in foreign
currency exchange rates on investments in securities are included with the
net realized and unrealized gain or loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
INCOME TAXES - CONTINUED
that it distributes substantially all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. Interest income is accrued as earned. Investment income
is recorded net of foreign taxes withheld where recovery of such taxes is
uncertain.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date. Income dividends are declared separately for each class,
while capital gain distributions are declared at the fund level and
allocated to each class on a pro rata basis based on the number of shares
held by each class on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for foreign
currency transactions, defaulted bonds, capital loss carryforwards and
losses deferred due to wash sales and excise tax regulations. The fund also
utilized earnings and profits distributed to shareholders on redemption of
shares as a part of the dividends paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net investment income and realized
and unrealized gain (loss). 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.
FORWARD FOREIGN CURRENCY CONTRACTS. The fund may use foreign currency
contracts to facilitate transactions in foreign securities and to manage
the fund's currency exposure. Contracts to buy generally are used to
acquire exposure to foreign currencies, while contracts to sell are used to
hedge the fund's investments against currency fluctuations. Also, a
contract to buy or sell can offset a previous contract.
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 forward foreign currency contracts is determined using
forward currency exchange rates supplied by a quotation service. Purchases
and sales of forward foreign currency contracts having the
2. OPERATING POLICIES - CONTINUED
FORWARD FOREIGN CURRENCY
CONTRACTS - CONTINUED
same settlement date and broker are offset and any realized gain (loss) is
recognized on the date of offset; otherwise, gain (loss) is recognized on
settlement date.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), the funds, along with other
affiliated entities of Fidelity Management & Research Company (FMR), may
transfer uninvested cash balances into one or more joint trading accounts.
These balances are invested in one or more repurchase agreements that
mature in 60 days or less from the date of purchase, and are collateralized
by U.S. Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The funds, through their custodian, receive delivery
of the underlying U.S. Treasury or Federal Agency securities, the market
value of which is required to be at least equal to the repurchase price.
For term repurchase agreement transactions, the underlying securities are
marked-to-market daily and maintained at a value at least equal to the
repurchase price. FMR, the funds' investment adviser, is responsible for
determining that the value of the underlying securities remains in
accordance with the market value requirements stated above.
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $956,054,091 and $777,055,649, respectively, of which U.S.
government and government agency obligations aggregated $85,274,251 and
$4,983,594, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
basic fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR. The
rates ranged from .2700% to .5200% for the period. In the event that these
rates were lower than the contractual rates in effect during the period,
FMR voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. The annual individual fund fee rate is .30%. The
basic fee is subject to a performance adjustment (up to a maximum of
(plus/minus) .20%) based on the fund's investment performance of the lowest
performing class as compared to the appropriate index over a specified
period of time. The investment performance is measured separately for each
class. For the period, the management fee was equivalent to an annual rate
of .62% of average net assets after the performance adjustment.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MANAGEMENT FEE - CONTINUED
The Board of Trustees has approved a new group fee rate schedule with rates
ranging from .2500% to .5200%. Effective January 1, 1996, FMR voluntarily
agreed to implement this new group fee rate schedule as it results in the
same or a lower management fee.
DISTRIBUTION AND SERVICE PLAN. In accordance with Rule 12b-1 of the 1940
Act, the Trustees have adopted separate distribution plans with respect to
the fund's Class A shares (Class A Plan), Class B shares (Class B Plan),
and Institutional Class shares (collectively referred to as "the Plans").
Under the Class A Plan and Class B Plan, the fund pays Fidelity
Distributors Corporation (FDC), an affiliate of FMR, a distribution and
service fee. This fee is based on annual rates of .65% and 1.00% (of which
.75% represents a distribution fee and .25% represents a shareholder
service fee) of the average net assets of the Class A and Class B shares,
respectively. Effective January 1, 1996, the Board of Trustees approved a
revised Class A distribution plan. Under the revised plan, the fee is based
on an annual rate of .50% of the average net assets of the Class A shares.
For the period, the fund paid FDC $3,182,013 and $476,105 under the Class A
Plan and Class B Plan, respectively, of which $2,377,409 and $116,312 were
paid to securities dealers, banks and other financial institutions for
the distribution of Class A and Class B shares, respectively, and providing
shareholder support services.
Under the Plans, FMR or FDC may use its resources to pay administrative and
promotional expenses related to the sale of the fund's Class A, Class B,
and Institutional Class shares. The Plans also authorize payments to third
parties that assist in the sale of the fund's shares or render shareholder
support services.
SALES LOAD. FDC receives a front-end sales charge of up to 4.75% for
selling Class A and Initial Class shares of the fund. Effective January 1,
1996, the Board of Trustees approved a revised Class A and Initial Class
sales charge. Under the revised arrangement, FDC receives a front-end sales
charge of up to 3.50% for selling Class A and Initial Class shares of the
fund. For the period, FDC received sales charges of $1,885,188 on sales of
Class A and Initial Class shares of the fund, of which $1,738,480 was paid
to securities dealers, banks, and other financial institutions. FDC also
receives the proceeds of a contingent deferred sales charge levied on Class
B share redemptions occurring within five years of purchase. The charge is
based on declining rates which range from 4% to 1% 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.
For the period, FDC received contingent deferred sales charges of $40,916
on Class B share redemptions from the
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SALES LOAD - CONTINUED
fund. When Class B shares are sold, FDC pays commissions from its own
resources to dealers through which the sales are made.
TRANSFER AGENT FEES. State Street Bank and Trust Company (State Street),
Fidelity Investments Institutional Operations Company (FIIOC), an affiliate
of FMR, and Fidelity Service Co. (FSC), also an affiliate of FMR,
(collectively referred to as the Transfer Agents) are the transfer,
dividend disbursing, and shareholder servicing agents for the fund's Class
A shares, Class B shares and Institutional Class shares, and Initial Class
shares, respectively. The Transfer Agents receive account fees and
asset-based fees that vary according to the account size and type of
account of the shareholders of the respective classes of the fund. With
respect to the Class A shares, State Street has delegated certain transfer,
dividend paying, and shareholder services to FIIOC for which FIIOC receives
its allocable share of all such fees. FIIOC and FSC pay for typesetting,
printing and mailing of all shareholder reports, except proxy statements.
For the period, the transfer agent fees were equivalent to an annual rate
of .24%, .27%, .06% (annualized), and .22% of average net assets for Class
A, Class B, Institutional Class and Initial Class, respectively.
ACCOUNTING FEES. FSC maintains the fund's accounting records. The fee is
based on the level of average net assets for the month plus out-of-pocket
expenses.
BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid to these affiliated firms were $217,580 for the period.
5. BANK BORROWINGS.
The fund is permitted to have bank borrowings for temporary or emergency
purposes to fund shareholder redemptions. The fund has established
borrowing arrangements with certain banks. Under the most restrictive
arrangement, the fund must pledge to the bank securities having a market
value in excess of 220% of the total bank borrowings. The interest rate on
the borrowings is the bank's base rate, as revised from time to time. The
maximum loan and the average daily loan balances during the period for
which loans were outstanding amounted to $1,781,000. The weighted average
interest rate was 6.4375%. Interest expense includes $948 paid under the
bank borrowing program.
6. EXPENSE REDUCTIONS.
FMR has directed certain portfolio trades to brokers who paid a portion of
the fund's expenses. For the period, the fund's expenses were reduced by
$38,211 under this arrangement.
7. SHARE TRANSACTIONS.
Share transactions for each class of shares were as follows:
SHARES
YEAR ENDED THREE MONTHS ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1995 B 1994 1994 A
CLASS A
Shares sold 9,172,492 1,516,748 9,950,363
Reinvestment of distributions 758,477 494,691 946,630
Shares redeemed (5,097,863) (1,234,112) (3,569,676)
Net increase (decrease) 4,833,106 777,327 7,327,317
CLASS B
Shares sold 2,741,552 485,395 444,178
Reinvestment of distributions 119,876 29,181 -
Shares redeemed (216,251) (36,053) (2,423)
Net increase (decrease) 2,645,177 478,523 441,755
INITIAL CLASS
Shares sold 13,543 22,104 10,959
Reinvestment of distributions 33,960 32,999 86,923
Shares redeemed (46,783) (54,526) (77,300)
Net increase (decrease) 720 577 20,582
INSTITUTIONAL CLASS
Shares sold 804,353 - -
Reinvestment of distributions 33,876 - -
Shares redeemed (14,477) - -
Net increase (decrease) 823,752 - -

7. SHARE TRANSACTIONS - CONTINUED
DOLLARS
YEAR ENDED THREE MONTHS ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1995 B 1994 1994 A
AMOUNTS IN THOUSANDS
CLASS A
Shares sold $ 204,159,266 $ 29,239,750 $ 204,646,521
Reinvestment of distributions 18,559,827 9,270,516 19,661,509
Shares redeemed (111,903,939) (23,824,539) (72,396,373)
Net increase (decrease) $ 110,815,154 $ 14,685,727 $ 151,911,657
CLASS B
Shares sold $ 61,331,975 $ 9,362,672 $ 8,900,939
Reinvestment of distributions 2,896,199 542,478 -
Shares redeemed (4,921,449) (702,223) (48,808)
Net increase (decrease) $ 59,306,725 $ 9,202,927 $ 8,852,131
INITIAL CLASS
Shares sold $ 326,042 $ 432,827 $ 228,789
Reinvestment of distributions 838,428 623,021 1,818,425
Shares redeemed (1,049,626) (1,044,732) (1,612,575)
Net increase (decrease) $ 114,844 $ 11,116 $ 434,639
INSTITUTIONAL CLASS
Shares sold $ 18,524,159 $ - $ -
Reinvestment of distributions 826,550 - -
Shares redeemed (346,163) - -
Net increase (decrease) $ 19,004,546 $ - $ -
A SHARE TRANSACTIONS FOR CLASS B ARE FOR THE PERIOD JUNE 30, 1994
(COMMENCEMENT OF SALE OF SHARES) TO SEPTEMBER 30, 1994.
B SHARE TRANSACTIONS FOR INSTITUTIONAL CLASS ARE FOR THE PERIOD JULY 3,
1995 (COMMENCEMENT OF SALE OF SHARES) TO DECEMBER 31, 1995.
8. TRANSACTIONS WITH
AFFILIATED COMPANIES.
An affiliated company is a company in which the fund has ownership of at
least 5% of the voting securities. Transactions during the period with
companies which are or were affiliates are as follows:
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES
PURCHASE SALES DIVIDEND MARKET
AFFILIATE COST COST INCOME VALUE
ACTV, Inc. $ - $ 875,000 $ - $ - I-Stat Corp. - - - 35,525,750
Showscan Corp. - 1,347,885 - -
TOTALS $ - $ 2,222,885 $ - $35,525,750
REPORT OF INDEPENDENT ACCOUNTANTS

To the Trustees of Fidelity Advisor Series VIII and the Shareholders of
Fidelity Advisor Strategic Opportunities Fund:
We have audited the accompanying statements of assets and liabilities of
Fidelity Advisor Series VIII: Fidelity Advisor Strategic Opportunities
Fund, including the schedule of portfolio investments, as of December 31,
1995, and the related statements of operations for the year then ended, the
statement of changes in net assets for the year then ended, for the period
from October 1, 1994 through December 31, 1994, and for the year ended
September 30, 1994, and the financial highlights for the year ended
December 31, 1995, for the period from October 1, 1994 through December 31,
1994, and for the four years in the period ended September 30, 1994 (Class
A and Initial Class), for the year ended December 31, 1995, for the period
from October 1, 1994 through December 31, 1994 and for the period from June
30, 1994 (commencement of sale of Class B shares) through September 30,
1994 (Class B), and for the period from July 3, 1995 (commencement of sale
of Institutional Class shares) through December 31, 1995 (Institutional
Class). These financial statements and financial highlights are the
responsibility of the fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995 by correspondence with the custodian and brokers. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Advisor Series VIII: Fidelity Advisor Strategic Opportunities
Fund as of December 31, 1995, the results of its operations for the year
then ended, the changes in its net assets for the year then ended, for the
period from October 1, 1994 through December 31, 1994 and for the year
ended September 30, 1994, and the financial highlights for the year ended
December 31, 1995, for the period from October 1, 1994 through December 31,
1994, and for the four years in the period ended September 30, 1994 (Class
A and Initial Class), for the year ended December 31, 1995, for the period
from October 1, 1994 through December 31, 1994 and for the period from June
30, 1994 (commencement of sale of Class B shares) through September 30,
1994 (Class B) and for the period July 3, 1995 (commencement of sale of
Institutional Class shares) to December 31, 1995 (Institutional Class), in
conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
February 2, 1996
DISTRIBUTIONS

The Board of Trustees of Fidelity Advisor Strategic Opportunities Fund
voted to pay to shareholders of record at the opening of business on record
date, the following distributions derived from capital gains realized from
sales of portfolio securities:
PAY DATE RECORD DATE DIVIDENDS CAPITAL GAINS
Class A 2/5/96 2/2/96 - $.41
Class B 2/5/96 2/2/96 - $.41
Institutional Class 2/5/96 2/2/96 - $.41
Initial Class 2/5/96 2/2/96 - $.41
A total of 18.97% of the dividends distributed during the fiscal year was
derived from interest on U.S. Government securities which is generally
exempt from state income tax.
The fund notified shareholders in January 1996 of the applicable percentage
for use in preparing 1995 income tax returns.

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Daniel R. Frank, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Robert H. Morrison, Manager,
Security Transactions
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Investments Institutional Operations Company
Boston, MA
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
GROWTH FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Growth
Opportunities Fund
Fidelity Advisor Strategic
Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Income Fund
Fidelity Advisor Income & Growth Fund
TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund
MUNICIPAL FUNDS
Fidelity Advisor High Income
Municipal Fund
Fidelity Advisor Intermediate Municipal Income Fund
Fidelity Advisor Short-Intermediate Municipal Income Fund
STATE MUNICIPAL FUNDS
Fidelity Advisor New York Municipal Income Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)
(registered trademark)
* INDEPENDENT TRUSTEES

(2_FIDELITY_LOGOS)FIDELITY ADVISOR

STRATEGIC OPPORTUNITIES
FUND - CLASS A AND CLASS B
ANNUAL REPORT
DECEMBER 31, 1995
CONTENTS

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

PERFORMANCE 4 How the fund has done over time.

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

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

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

FINANCIAL STATEMENTS 20 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 27 Notes to the financial statements.

REPORT OF INDEPENDENT 34 The auditors' opinion.
ACCOUNTANTS

DISTRIBUTIONS 35

There are several ways to evaluate historical performance. You can look at
the total percentage change in value, the average annual percentage change,
or the growth of a hypothetical $10,000 investment. A fund's total return
includes changes in share price, plus reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells
securities that have grown in value). The initial offering of Class A
shares took place on August 20, 1986. Class A shares bear a .50% 12b-1 fee.
Prior to January 1, 1996, this fee was .65%, which is reflected in the
returns below for periods after August 20, 1986. Returns prior to that date
are those of Initial Class, the original class of the fund. Had Class A's
12b-1 fee been reflected, returns prior to August 20, 1986 would have been
lower. If Fidelity had not reimbursed certain class expenses during the
periods shown, the total returns would have been lower. Effective January
1, 1996, the maximum 4.75% sales charge on Class A shares was reduced to
3.50%.
CUMULATIVE TOTAL RETURNS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED DECEMBER 31, 1995 PAST 1 YEAR PAST 5 YEARS PAST 10
YEARS

Advisor Strategic Opportunities - Class A 38.16% 114.58% 286.89%

Advisor Strategic Opportunities - Class A 33.32% 107.07% 273.35%
(incl. max. 3.50% sales charge) 1

S&P 500(registered trademark) 37.58% 115.52% 300.54%

Average Capital Appreciation Fund 30.34% 125.37% 245.70%

</TABLE>

CUMULATIVE TOTAL RETURNS show Class A's performance in percentage terms
over a set period - in this case, one year, five years, or 10 years. For
example, if you invested $1,000 in a fund that had a 5% return over the
past year, the value of your investment would be $1,050. You can compare
Class A's returns to those of the Standard & Poor's Composite Index of 500
Stocks - a common proxy for the U.S. stock market. To measure how Class A's
performance stacked up against its peers, you can compare it to the average
capital appreciation fund, which reflects the performance of 158 capital
appreciation funds with similar objectives tracked by Lipper Analytical
Services over the past 12 months. These benchmarks include reinvested
dividends and capital gains, if any, and exclude the effects of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS

Advisor Strategic Opportunities - Class A 38.16% 16.50% 14.49%

Advisor Strategic Opportunities - Class A 33.32% 15.67% 14.08%
(incl. max. 3.50% sales charge) 1

S&P 500 37.58% 16.60% 14.89%

Average Capital Appreciation Fund 30.34% 16.97% 12.31%

AVERAGE ANNUAL TOTAL RETURNS take Class A shares' actual (or cumulative)
return and show you what would have happened if Class A shares had
performed at a constant rate each year.

1 HAD THE FORMER MAXIMUM 4.75% SALES CHARGE BEEN REFLECTED, THE CUMULATIVE
AND AVERAGE ANNUAL TOTAL RETURNS FOR THE PAST ONE, FIVE, AND 10 YEARS WOULD
HAVE BEEN 31.60% AND 31.60%, 104.39% AND 15.37%, AND 268.51% AND 13.93%,
RESPECTIVELY.
$10,000 OVER 10 YEARS
FA Strat Opps cl A S&P 500
12/31/85 9650.00 10000.00
01/31/86 10079.21 10056.00
02/28/86 10930.47 10808.19
03/31/86 11717.35 11411.29
04/30/86 11517.05 11282.34
05/31/86 11745.96 11882.56
06/30/86 12375.46 12083.37
07/31/86 11982.02 11407.91
08/31/86 12790.36 12254.38
09/30/86 11953.41 11240.94
10/31/86 12418.38 11889.55
11/30/86 12610.84 12178.46
12/31/86 12344.31 11867.91
01/31/87 13357.13 13466.52
02/28/87 13494.21 13998.45
03/31/87 13890.20 14403.00
04/30/87 13478.98 14274.81
05/31/87 13608.44 14399.01
06/30/87 14034.89 15126.15
07/31/87 14598.42 15893.05
08/31/87 14887.80 16485.86
09/30/87 14514.65 16124.82
10/31/87 11849.31 12651.53
11/30/87 11308.63 11609.05
12/31/87 11562.44 12492.50
01/31/88 12468.26 13018.43
02/29/88 12876.76 13625.09
03/31/88 12672.51 13204.07
04/30/88 12752.43 13350.64
05/31/88 12974.45 13466.79
06/30/88 13862.50 14084.92
07/31/88 13782.57 14031.39
08/31/88 13356.31 13554.33
09/30/88 13791.45 14131.74
10/31/88 14031.23 14524.60
11/30/88 14120.03 14316.90
12/31/88 14134.90 14567.45
01/31/89 14935.51 15633.78
02/28/89 14871.09 15244.50
03/31/89 15183.97 15599.70
04/30/89 15763.72 16409.32
05/31/89 16490.71 17073.90
06/30/89 16619.55 16976.58
07/31/89 17760.65 18509.57
08/31/89 17990.71 18872.35
09/30/89 17990.71 18794.98
10/31/89 17696.23 18358.93
11/30/89 18174.75 18733.46
12/31/89 18742.57 19183.06
01/31/90 17503.16 17895.87
02/28/90 17597.77 18126.73
03/31/90 17597.77 18607.09
04/30/90 16878.72 18141.91
05/31/90 17427.47 19910.75
06/30/90 17597.77 19775.36
07/31/90 17645.07 19712.07
08/31/90 16405.66 17930.10
09/30/90 16282.67 17056.91
10/31/90 16273.21 16983.56
11/30/90 16992.25 18080.70
12/31/90 17398.68 18585.15
01/31/91 17960.88 19395.46
02/28/91 19035.97 20782.24
03/31/91 19637.63 21285.17
04/30/91 19903.94 21336.26
05/31/91 20614.09 22257.98
06/30/91 19963.11 21238.57
07/31/91 20564.77 22228.28
08/31/91 21008.61 22755.09
09/30/91 21087.52 22375.08
10/31/91 20663.40 22674.91
11/30/91 20160.38 21761.11
12/31/91 21414.17 24250.58
01/31/92 21448.91 23799.52
02/29/92 21865.85 24108.91
03/31/92 21309.94 23638.79
04/30/92 21715.29 24333.77
05/31/92 22421.76 24453.01
06/30/92 22421.76 24088.66
07/31/92 23116.65 25073.88
08/31/92 22711.30 24559.87
09/30/92 22618.64 24849.67
10/31/92 22803.95 24936.65
11/30/92 23776.79 25786.99
12/31/92 24170.71 26104.17
01/31/93 24627.48 26323.44
02/28/93 25325.32 26681.44
03/31/93 26111.98 27244.42
04/30/93 25591.77 26585.11
05/31/93 26188.11 27297.59
06/30/93 26403.81 27376.75
07/31/93 26962.08 27267.24
08/31/93 28649.59 28300.67
09/30/93 28573.46 28082.76
10/31/93 29474.31 28664.07
11/30/93 28230.88 28391.76
12/31/93 29110.28 28735.30
01/31/94 29362.20 29712.30
02/28/94 28312.55 28907.10
03/31/94 27220.91 27646.75
04/30/94 27444.84 28000.63
05/31/94 27500.82 28459.84
06/30/94 27500.82 27762.57
07/31/94 28158.60 28673.18
08/31/94 28326.54 29848.78
09/30/94 27934.67 29117.49
10/31/94 27640.77 29772.63
11/30/94 26787.06 28688.31
12/31/94 27023.15 29113.76
01/31/95 28222.58 29868.68
02/28/95 28945.12 31032.66
03/31/95 29219.69 31948.44
04/30/95 29855.53 32889.32
05/31/95 30635.88 34203.90
06/30/95 32239.92 34998.46
07/31/95 33323.74 36159.01
08/31/95 34277.50 36249.77
09/30/95 35448.02 37779.51
10/31/95 35317.96 37644.64
11/30/95 36257.27 39297.24
12/29/95 37334.94 40054.10

$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity Advisor
Strategic Opportunities Fund - Class A on December 31, 1985, and paid the
current maximum 3.50% sales charge. As the chart shows, by December 31,
1995, the value of your investment would have grown to $37,335 - a 273.35%
increase on your initial investment. For comparison, look at how the S&P
500 did over the same period. With dividends reinvested, the same $10,000
investment would have grown to $40,054 - a 300.54% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
ADVISOR STRATEGIC OPPORTUNITIES FUND - CLASS B
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate historical performance. You can look at
the total percentage change in value, the average annual percentage change,
or the growth of a hypothetical $10,000 investment. A fund's total return
includes changes in share price, plus reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells
securities that have grown in value). Initial offering of Class B shares
took place on June 30, 1994. Class B shares bear a 1.00% 12b-1/shareholder
service fee. This fee is not reflected in returns prior to that date.
Returns between August 20, 1986 and June 30, 1994 are those of Class A, and
reflect Class A's .65% 12b-1 fee. Returns prior to August 20, 1986 are
those of Initial Class, the original class of the fund. Had Class B's 12b-1
fee been reflected, prior returns would have been lower. If Fidelity had
not reimbursed certain class expenses during the periods shown, the total
returns would have been lower. Class B's contingent deferred sales charges
included in the past one year, past five years and past 10 years total
return figures are 4%, 1% and 0%, respectively.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS

Advisor Strategic Opportunities - Class B 37.35% 113.22% 284.43%

Advisor Strategic Opportunities - Class B 33.35% 112.22% 284.43%
(incl. contingent deferred sales charge)

S&P 500(registered trademark) 37.58% 115.52% 300.54%

Average Capital Appreciation Fund 30.34% 125.37% 245.70%

CUMULATIVE TOTAL RETURNS show Class B's performance in percentage terms
over a set period - in this case, one year, five years, or 10 years. For
example, if you invested $1,000 in a fund that had a 5% return over the
past year, the value of your investment would be $1,050. You can compare
Class B's returns to those of the Standard & Poor's Composite Index of 500
Stocks - a common proxy for the U.S. stock market. To measure how Class B's
performance stacked up against its peers, you can compare it to the average
capital appreciation fund, which reflects the performance of 158 capital
appreciation funds with similar objectives tracked by Lipper Analytical
Services over the past 12 months. These benchmarks include reinvested
dividends and capital gains, if any, and exclude the effects of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS

Advisor Strategic Opportunities - Class B 37.35% 16.35% 14.41%

Advisor Strategic Opportunities - Class B 33.35% 16.24% 14.41%
(incl. contingent deferred sales charge)

S&P 500 37.58% 16.60% 14.89%

Average Capital Appreciation Fund 30.34% 16.97% 12.31%

AVERAGE ANNUAL TOTAL RETURNS take Class B shares' actual (or cumulative)
return and show you what would have happened if Class B shares had
performed at a constant rate each year.
$10,000 OVER 10 YEARS
F A Strat Opp Cl B (S&P 500
12/31/85 10000.00 10000.00
01/31/86 10444.77 10056.00
02/28/86 11326.91 10808.19
03/31/86 12142.33 11411.29
04/30/86 11934.77 11282.34
05/31/86 12171.98 11882.56
06/30/86 12824.31 12083.37
07/31/86 12416.60 11407.91
08/31/86 13254.26 12254.38
09/30/86 12386.95 11240.94
10/31/86 12868.79 11889.55
11/30/86 13068.23 12178.46
12/31/86 12792.03 11867.91
01/31/87 13841.59 13466.52
02/28/87 13983.63 13998.45
03/31/87 14393.99 14403.00
04/30/87 13967.85 14274.81
05/31/87 14102.01 14399.01
06/30/87 14543.93 15126.15
07/31/87 15127.89 15893.05
08/31/87 15427.77 16485.86
09/30/87 15041.09 16124.82
10/31/87 12279.08 12651.53
11/30/87 11718.79 11609.05
12/31/87 11981.81 12492.50
01/31/88 12920.47 13018.43
02/29/88 13343.79 13625.09
03/31/88 13132.13 13204.07
04/30/88 13214.96 13350.64
05/31/88 13445.02 13466.79
06/30/88 14365.28 14084.92
07/31/88 14282.46 14031.39
08/31/88 13840.73 13554.33
09/30/88 14291.66 14131.74
10/31/88 14540.13 14524.60
11/30/88 14632.16 14316.90
12/31/88 14647.56 14567.45
01/31/89 15477.21 15633.78
02/28/89 15410.46 15244.50
03/31/89 15734.69 15599.70
04/30/89 16335.46 16409.32
05/31/89 17088.82 17073.90
06/30/89 17222.33 16976.58
07/31/89 18404.81 18509.57
08/31/89 18643.22 18872.35
09/30/89 18643.22 18794.98
10/31/89 18338.06 18358.93
11/30/89 18833.94 18733.46
12/31/89 19422.35 19183.06
01/31/90 18137.99 17895.87
02/28/90 18236.03 18126.73
03/31/90 18236.03 18607.09
04/30/90 17490.90 18141.91
05/31/90 18059.55 19910.75
06/30/90 18236.03 19775.36
07/31/90 18285.05 19712.07
08/31/90 17000.69 17930.10
09/30/90 16873.23 17056.91
10/31/90 16863.43 16983.56
11/30/90 17608.55 18080.70
12/31/90 18029.72 18585.15
01/31/91 18612.32 19395.46
02/28/91 19726.40 20782.24
03/31/91 20349.87 21285.17
04/30/91 20625.84 21336.26
05/31/91 21361.75 22257.98
06/30/91 20687.17 21238.57
07/31/91 21310.64 22228.28
08/31/91 21770.58 22755.09
09/30/91 21852.35 22375.08
10/31/91 21412.85 22674.91
11/30/91 20891.58 21761.11
12/31/91 22190.85 24250.58
01/31/92 22226.85 23799.52
02/29/92 22658.91 24108.91
03/31/92 22082.83 23638.79
04/30/92 22502.89 24333.77
05/31/92 23234.98 24453.01
06/30/92 23234.98 24088.66
07/31/92 23955.08 25073.88
08/31/92 23535.02 24559.87
09/30/92 23439.01 24849.67
10/31/92 23631.03 24936.65
11/30/92 24639.16 25786.99
12/31/92 25047.37 26104.17
01/31/93 25520.71 26323.44
02/28/93 26243.86 26681.44
03/31/93 27059.05 27244.42
04/30/93 26519.97 26585.11
05/31/93 27137.94 27297.59
06/30/93 27361.46 27376.75
07/31/93 27939.98 27267.24
08/31/93 29688.69 28300.67
09/30/93 29609.80 28082.76
10/31/93 30543.33 28664.07
11/30/93 29254.80 28391.76
12/31/93 30166.09 28735.30
01/31/94 30427.15 29712.30
02/28/94 29339.43 28907.10
03/31/94 28208.20 27646.75
04/30/94 28440.25 28000.63
05/31/94 28498.26 28459.84
06/30/94 28498.26 27762.57
07/31/94 29208.90 28673.18
08/31/94 29368.43 29848.78
09/30/94 28976.85 29117.49
10/31/94 28643.29 29772.63
11/30/94 27729.60 28688.31
12/31/94 27989.52 29113.76
01/31/95 29180.24 29868.68
02/28/95 29918.79 31032.66
03/31/95 30190.09 31948.44
04/30/95 30838.21 32889.32
05/31/95 31637.04 34203.90
06/30/95 33295.01 34998.46
07/31/95 34395.30 36159.01
08/31/95 35344.86 36249.77
09/30/95 36535.59 37779.51
10/31/95 36399.93 37644.64
11/30/95 37349.50 39297.24
12/29/95 38442.85 40054.10

$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity Advisor
Strategic Opportunities Fund - Class B on December 31, 1985. As the chart
shows, by December 31, 1995, the value of your investment would have grown
to $38,443 - a 284.43% increase on your initial investment. For comparison,
look at how the S&P 500 did over the same period. With dividends
reinvested, the same $10,000 investment would have grown to $40,054 - a
300.54% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW

MARKET RECAP
Strong corporate earnings and a
favorable interest rate
environment helped the U.S.
stock market post robust returns
for the 12 months ended
December 31, 1995. The Standard
& Poor's Composite Index of 500
Stocks finished the 12-month
period with a total return of
37.58% (including reinvested
dividends ) - well above its
historical annual average of
roughly 12%. With inflation
posing little threat, interest rates
fell during the first half of 1995.
The Federal Reserve Board cut
the fed funds rate - the rate
banks charge each other for
overnight loans - twice, in July
and December.
Large-capitalization stocks led
the rally, with the weak dollar
helping to bolster overseas
business. Technology companies
posted the strongest earnings
growth and stock price gain,
although they faltered somewhat
in the fourth quarter. Lower
interest rates and continued
merger and acquisition activity
helped financial stocks perform
well. In November, the Dow Jones
Industrial Average closed above
5000 for the first time. Returns
from foreign markets suffered as
investors brought capital back to
the U.S. The Morgan Stanley
Emerging Markets Free Index
was down 5.21% for the 12
months ended December 31. The
Morgan Stanley EAFE (Europe,
Australasia, Far East) Index was
up 11.21% for the year. European
markets fared well through 1995,
while the Japanese market
recently has shown signs of
recovery.
An interview with Daniel R. Frank Portfolio Manager of Fidelity Advisor
Strategic Opportunities Fund
Q. DAN, HOW DID THE FUND PERFORM OVER THE PAST 12 MONTHS?
A. The fund performed well, with Class A shares returning 38.16% and Class
B shares returning 37.35% during the year ended December 31, 1995. During
the same period, the average capital appreciation fund returned 30.34%,
according to Lipper Analytical Services.
Q. THE PAST YEAR'S MARKET SUCCESS WAS LED, TO A GREAT DEGREE, BY TECHNOLOGY
STOCKS. SINCE YOUR TECHNOLOGY HOLDINGS WERE NEGLIGIBLE DURING THE PERIOD,
WHAT FACTORS CONTRIBUTED TO THE FUND'S PERFORMANCE?
A. The story is nearly identical to our discussion in the semiannual report
at the end of June. In short, it's the three "Bs" - the Bells, banks and
bonds. The regional Bell operating companies (RBOCs) were spectacular,
standing as one of the best-performing sectors in the market last year.
Regional banks were one of the top performing sectors, as well. Also,
interest rates continued to come down, helping the long-term Treasury
position. Zero coupon bonds - which tend to be extremely sensitive to
changes in interest rates - were the fund's largest holding as of the end
of the period and outperformed the S&P 500.
Q. ALMOST ONE QUARTER OF THE FUND'S HOLDINGS WAS RBOCS - ABOUT THE SAME AS
SIX MONTHS AGO. THEIR PERFORMANCE CONTINUED TO BE SUPERIOR . . .
A. Nothing really has changed. BellSouth, Ameritech, Bell Atlantic, NYNEX
and SBC Communications remain among the fund's 10 largest holdings.
Revenue, earnings and dividend growth continued to be strong. Legislation
at the state levels continued to be favorable. Federal legislation, though
still pending, may help to allow the RBOCs to get into the long-distance
business while de-regulating the rest of their business. You have a
combination of continued growth in phone lines and such enhanced services
as voice mail, as well as increasing returns from the cellular and overseas
components of their operations. Further, by default, the RBOCs are the
Internet access providers. By this I mean that as people log-in to the
information superhighway, they're adding second and third phone lines at
home. Over the past decade, the total return from the RBOCs has been
substantially more than the S&P 500.
Q. ON THE OTHER HAND, YOU TRIMMED THE FUND'S HOLDING IN FINANCIAL SERVICES
ALMOST IN HALF - TO 14%. WHY?
A. If you look at the fund's history in recent years, you'll see that at
different times I've held big positions in this sector and also have had
less than 10% of the fund's holdings in financial services. Banks, for
example, tend to do well when interest rates come down. The underlying
fundamentals of their loan portfolios, however, had me nervous at the end
of the period. Consumer credit quality has been deteriorating and there has
been no loan growth. Banks have not performed well in the past when faced
with similar conditions.
Q. YOU INCREASED THE FUND'S HOLDINGS IN THE MEDIA AND LEISURE SECTOR. WHAT
DID YOU SEE THAT MADE THIS MARKET SEGMENT ATTRACTIVE?
A. The holdings in this sector during the period were mostly newspapers - a
new story for the fund - with a lot of new names added. These new holdings
included Gannett, Knight-Ridder and News Corp. These stocks have done
little over the past decade and have had their earnings depressed by the
dramatic rise in newsprint prices over the past three years. Many of these
companies generate substantial excess cash which has been and can continue
to be used to benefit shareholders. Icing on the cake would be a decline in
newsprint prices.
Q. WERE THERE ANY DISAPPOINTMENTS DURING THE PERIOD?
A. Going into 1995, I probably would have been happy with a return of 10%.
Still, Viacom, which was one of the fund's top holdings during the period
was a disappointment, particularly given its sizable assets, strong cash
flow and improving balance sheet. Kinder-Care Learning Centers, a provider
of day care services which the fund no longer held at the end of the
period, was another disappointment.
Q. WHAT'S YOUR STRATEGY GOING FORWARD?
A. It's extremely difficult to make accurate predictions about the future
of the securities markets. I think the market's performance during 1995 -
surpassing just about everyone's expectations - is perfect evidence of
that. As always, however, I will continue to seek out and invest in those
companies and market sectors where I believe there is value and the
opportunity for capital appreciation.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.

TOP TEN STOCKS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

BellSouth Corp. 5.4 5.1

Ameritech Corp. 5.1 5.0

Bell Atlantic Corp. 4.9 4.9

I-Stat Corp. 4.7 7.2

NYNEX Corp. 4.6 4.3

SBC Communications, Inc. 4.4 4.7

Viacom, Inc. (various issues) 4.3 5.3

Philip Morris Companies, Inc. 2.3 0.0

Tootsie Roll Industries, Inc. 1.7 1.5

Regis Corp. 1.2 1.4

TOP FIVE MARKET SECTORS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET SECTORS
6 MONTHS AGO

Utilities 25.9 26.0

Finance 14.0 24.4

Media & Leisure 8.8 6.0

Nondurables 8.8 4.5

Health 6.0 10.6

Showing Percentage of Total Value of Investments in Securities

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS DECEMBER 31, 1995

Investment in securities, at value (including repurchase $ 752,341,103
agreements of $39,414,000) (cost $623,837,619) -
See accompanying schedule

Cash 1,667

Receivable for investments sold 12,075,751

Receivable for fund shares sold 6,699,232

Dividends receivable 1,256,090

Interest receivable 230,632

Other receivables 101,210

Prepaid expenses 8,975

TOTAL ASSETS 772,714,660

LIABILITIES

Payable for investments purchased $ 15,531,409

Payable for fund shares redeemed 443,369

Distributions payable 4,222,435

Accrued management fee 375,779

Distribution fees payable 409,732

Other payables and accrued expenses 315,934

TOTAL LIABILITIES 21,298,658

NET ASSETS $ 751,416,002

Net Assets consist of: $ 609,715,457
Paid in capital

Accumulated undistributed net realized gain (loss) on 13,197,061
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 128,503,484
investments

NET ASSETS $ 751,416,002

CALCULATION OF MAXIMUM OFFERING PRICE $24.88
CLASS A:
NET ASSET VALUE, and redemption price per share
($619,992,880 (divided by) 24,920,869 shares)

Maximum offering price per share (100/95.25 of $24.88) $26.12

CLASS B: $24.56
NET ASSET VALUE, offering price and redemption price
per share ($87,565,658 (divided by) 3,565,455 shares) A

INSTITUTIONAL CLASS: $24.80
NET ASSET VALUE, offering price and redemption price
per share ($20,429,118 (divided by) 823,752 shares)

INITIAL CLASS: $25.10
NET ASSET VALUE and redemption price per share
($23,428,346 (divided by) 933,228 shares)

Maximum offering price per share (100/95.25 of $25.10) $26.35

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME YEAR ENDED DECEMBER 31, 1995

Dividends $ 11,406,495

Interest 8,282,971

TOTAL INCOME 19,689,466

EXPENSES

Management fee $ 3,419,543
Basic fee

Performance adjustment 91,269

Transfer agent fees 1,162,980
Class A

Class B 126,686

Institutional Class 4,398

Initial Class 44,511

Distribution fees - Class A 3,182,013

Distribution fees - Class B 467,105

Accounting fees and expenses 315,623

Non-interested trustees' compensation 3,060

Custodian fees and expenses 42,292

Registration fees - Class A 76,078

Registration fees - Class B 61,368

Registration fees - Institutional Class 17,791

Registration fees - Initial Class 23,362

Audit 37,973

Legal 31,273

Interest 948

Reports to shareholders 29,651

Miscellaneous 2,006

Total expenses before reductions 9,139,930

Expense reductions (38,211) 9,101,719

NET INVESTMENT INCOME 10,587,747

REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:

Investment securities (including realized loss of 36,075,671
$246,335 on sales of investment in affiliated issuers)

Foreign currency transactions (11,657) 36,064,014

Change in net unrealized appreciation (depreciation) on:

Investment securities 132,488,727

Assets and liabilities in foreign currencies 10,596 132,499,323

NET GAIN (LOSS) 168,563,337

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 179,151,084
OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
YEAR ENDED THREE MONTHS YEAR ENDED
DECEMBER 31, ENDED SEPTEMBER 30,
1995 DECEMBER 31, 1994
1994

INCREASE (DECREASE) IN NET ASSETS

Operations $ 10,587,747 $ 2,067,920 $ 6,903,469
Net investment income

Net realized gain (loss) 36,064,014 (5,789,778) 8,280,193

Change in net unrealized appreciation 132,499,323 (9,641,386) (23,325,658)
(depreciation)

NET INCREASE (DECREASE) IN NET ASSETS 179,151,084 (13,363,244) (8,141,996)
RESULTING FROM OPERATIONS

Distributions to shareholders (9,290,408) (6,826,359) (5,752,632)
From net investment income
Class A

Class B (1,281,036) (382,214) -

Institutional Class (433,848) - -

Initial Class (449,705) (464,141) (458,027)

From net realized gain (13,102,251) (5,071,018) (22,876,692)
Class A

Class B (1,854,130) (211,573) -

Institutional Class (433,848) - -

Initial Class (494,507) (241,353) (1,535,740)

TOTAL DISTRIBUTIONS (27,339,733) (13,196,658) (30,623,091)

Share transactions - net increase 189,241,269 23,899,770 161,198,427
(decrease)

TOTAL INCREASE (DECREASE) IN NET ASSETS 341,052,620 (2,660,132) 122,433,340

NET ASSETS

Beginning of period 410,363,382 413,023,514 290,590,174

End of period (including undistributed $ 751,416,002 $ 410,363,382 $ 413,023,514
net investment income of $0,
$0, and $5,875,182 respectively)

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS A YEAR ENDED THREE MONTHS YEARS ENDED SEPTEMBER 30,
DECEMBER 31, ENDED
DECEMBER 31,

SELECTED PER-SHARE DATA 1995 1994 1994 G 1993 1992 D 1991

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 18.70 $ 19.96 $ 22.52 $ 19.53 $ 21.38 $ 17.21

Income from Investment Operations

Net investment income .39 .10 F .39 F .33 .61 .66

Net realized and unrealized gain (loss) 6.73 (.75) (.81) 4.44 .58 4.26

Total from investment operations 7.12 (.65) (.42) 4.77 1.19 4.92

Less Distributions

From net investment income (.39) (.35) (.43) (.57) (.62) (.75)

From net realized gain (.55) (.26) (1.71) (1.21) (2.42) -

Total distributions (.94) (.61) (2.14) (1.78) (3.04) (.75)

Net asset value, end of period $ 24.88 $ 18.70 $ 19.96 $ 22.52 $ 19.53 $ 21.38

TOTAL RETURN B, C 38.16% (3.26)% (2.24)% 26.33% 7.26% 29.51%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 619,993 $ 375,691 $ 385,349 $ 269,833 $ 194,710 $ 199,604

Ratio of expenses to average net assets 1.61% 1.73% A, 1.85% 1.57% 1.46% 1.56%
H E

Ratio of expenses to average net assets after expense
reductions 1.61% I 1.73% A, 1.84% 1.57% 1.46% 1.56%
I I

Ratio of net investment income to average net assets 1.90% 2.03% A 1.89% 2.06% 3.22% 3.61%

Portfolio turnover 142% 228% A 159% 183% 211% 223%

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C>
YEAR ENDED THREE YEAR ENDED
DECEMBER MONTHS SEPTEMBER
31, ENDED 30,
DECEMBER
31,

1995 1994 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 18.57 $ 19.98 $ 19.65

Income from Investment Operations

Net investment income .38 .06 E .05 E

Net realized and unrealized gain (loss) 6.54 (.74) .28

Total from investment operations 6.92 (.68) .33

Less Distributions

From net investment income (.38) (.47) -

From net realized gain (.55) (.26) -

Total distributions (.93) (.73) -

Net asset value, end of period $ 24.56 $ 18.57 $ 19.98

TOTAL RETURN B, C 37.35% (3.41)% 1.68%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 87,566 $ 17,090 $ 8,824

Ratio of expenses to average net assets 2.11% 2.58% A 2.63% A,
G

Ratio of expenses to average net assets after 2.10% F 2.53% A, 2.63% A
expense reductions F

Ratio of net investment income to average net 1.40% 1.22% A 1.11% A
assets

Portfolio turnover 142% 228% A 159%

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - INITIAL CLASS YEAR ENDED THREE MONTHS YEARS ENDED SEPTEMBER 30,
DECEMBER 31, ENDED
DECEMBER 31,

SELECTED PER-SHARE DATA 1995 1994 1994 G 1993 1992 D 1991

</TABLE>

Net asset value, beginning of period $ 18.86 $ 20.23 $ 22.72 $ 19.72 $ 21.55 $ 17.37

Income from Investment Operations

Net investment income .50 .13 F .54 F .45 .73 .77

Net realized and unrealized gain (loss) 6.79 (.74) (.81) 4.46 .58 4.26

Total from investment operations 7.29 (.61) (.27) 4.91 1.31 5.03

Less Distributions

From net investment income (.50) (.50) (.51) (.70) (.72) (.85)

From net realized gain (.55) (.26) (1.71) (1.21) (2.42) -

Total distributions (1.05) (.76) (2.22) (1.91) (3.14) (.85)

Net asset value, end of period $ 25.10 $ 18.86 $ 20.23 $ 22.72 $ 19.72 $ 21.55

TOTAL RETURN B, C 38.75% (3.02)% (1.51)% 26.98% 7.89% 30.01%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 23,428 $ 17,583 $ 18,850 $ 20,707 $ 17,933 $ 19,193

Ratio of expenses to average net assets 1.04% 1.14% A 1.15% .89% .87% 1.00%

Ratio of expenses to average net assets after expense reductions 1.03% 1.11% A, 1.14% .89% .87% 1.00%

H H H

Ratio of net investment income to average net assets 2.47% 2.65% A 2.6% 2.74% 3.78% 4.12%

Portfolio turnover 142% 228% A 159% 183% 211% 223%

</TABLE>

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO FINANCIAL
STATEMENTS).
D AS OF OCTOBER 1, 1991 THE FUND DISCONTINUED THE USE OF EQUALIZATION
ACCOUNTING.
E INCLUDES REIMBURSEMENT OF $.03 PER SHARE FROM FIDELITY MANAGEMENT &
RESEARCH COMPANY FOR ADJUSTMENTS TO PRIOR PERIOD'S FEES.
F NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
G EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
H FMR HAS DIRECTED CERTAIN PORTFOLIO TRADES TO BROKERS WHO PAID A PORTION
OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS

<TABLE>
<CAPTION>
<S> <C>
YEAR ENDED
DECEMBER 31,

1995 B

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 22.35

Income from Investment Operations

Net investment income .55

Net realized and unrealized gain (loss) 3.00

Total from investment operations 3.55

Less Distributions

From net investment income (.55)

From net realized gain (.55)

Total distributions (1.10)

Net asset value, end of period $ 24.80

TOTAL RETURN C, D 15.96%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 20,429

Ratio of expenses to average net assets .97% A

Ratio of expenses to average net assets after expense reductions .96% A,
E

Ratio of net investment income to average net assets 2.55% A

Portfolio turnover 142%

</TABLE>

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Daniel R. Frank, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Robert H. Morrison, Manager,
Security Transactions
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
State Street Bank and Trust Company
Boston, MA - Class A
Fidelity Investments Institutional
Operations Company
Boston, MA - Class B
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
GROWTH FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Growth
Opportunities Fund
Fidelity Advisor Strategic
Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Income Fund
Fidelity Advisor Income & Growth Fund
TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund
MUNICIPAL FUNDS
Fidelity Advisor High Income
Municipal Fund
Fidelity Advisor Intermediate Municipal Income Fund
Fidelity Advisor Short-Intermediate Municipal Income Fund
STATE MUNICIPAL FUNDS
Fidelity Advisor New York Municipal Income Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)
(registered trademark)
* INDEPENDENT TRUSTEES

(2_FIDELITY_LOGOS)FIDELITY ADVISOR

STRATEGIC OPPORTUNITIES
FUND - INITIAL CLASS
ANNUAL REPORT
DECEMBER 31, 1995
CONTENTS

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

PERFORMANCE 4 How the fund has done over time.

FUND TALK 6 The manager's review of fund
performance, strategy and outlook.

INVESTMENT CHANGES 9 A summary of major shifts in the
fund's investments over the past six
months.

INVESTMENTS 10 A complete list of the fund's
investments with their market
values.

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

NOTES 25 Notes to the financial statements.

REPORT OF INDEPENDENT 32 The auditors' opinion.
ACCOUNTANTS

DISTRIBUTIONS 33

<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED DECEMBER 31, 1995 PAST 1 YEAR PAST 5 YEARS PAST 10
YEARS

Advisor Strategic Opportunities - Initial Class 38.75% 120.80% 305.88%

Advisor Strategic Opportunities - Initial Class 33.89% 113.07% 291.68%
(incl. max. 3.50% sales charge) 1

S&P 500(registered trademark) 37.58% 115.52% 300.54%

Average Capital Appreciation Fund 30.34% 125.37% 245.70%

</TABLE>

CUMULATIVE TOTAL RETURNS show Initial Class' performance in percentage
terms over a set period - in this case, one year, five years, or 10 years.
For example, if you invested $1,000 in a fund that had a 5% return over the
past year, the value of your investment would be $1,050. You can compare
Initial Class' returns to those of the Standard & Poor's Composite Index of
500 Stocks - a common proxy for the U.S. stock market. To measure how
Initial Class' performance stacked up against its peers, you can compare it
to the average capital appreciation fund, which reflects the performance of
158 capital appreciation funds with similar objectives tracked by Lipper
Analytical Services over the past 12 months. These benchmarks include
reinvested dividends and capital gains, if any, and exclude the effects of
sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS

Advisor Strategic Opportunities - Initial Class 38.75% 17.17% 15.04%

Advisor Strategic Opportunities - Initial Class 33.89% 16.33% 14.63%
(incl. max. 3.50% sales charge) 1

S&P 500 37.58% 16.60% 14.89%

Average Capital Appreciation Fund 30.34% 16.97% 12.31%

AVERAGE ANNUAL TOTAL RETURNS take the Initial Class shares' actual (or
cumulative) return and show you what would have happened if Initial Class
shares had performed at a constant rate each year.

1 HAD THE FORMER MAXIMUM 4.75% SALES CHARGE BEEN REFLECTED, THE CUMULATIVE
AND AVERAGE ANNUAL TOTAL RETURNS FOR THE PAST ONE, FIVE, AND 10 YEARS WOULD
HAVE BEEN 32.16% AND 32.16%, 110.31% AND 16.03%, AND 286.60% AND 14.48%,
RESPECTIVELY.
$10,000 OVER 10 YEARS
FA Strat Opps InitiaS&P 500
12/31/85 9650.00 10000.00
01/31/86 10079.21 10056.00
02/28/86 10930.47 10808.19
03/31/86 11717.35 11411.29
04/30/86 11517.05 11282.34
05/31/86 11745.96 11882.56
06/30/86 12375.46 12083.37
07/31/86 11982.02 11407.91
08/31/86 12790.36 12254.38
09/30/86 11953.41 11240.94
10/31/86 12418.38 11889.55
11/30/86 12610.84 12178.46
12/31/86 12344.31 11867.91
01/31/87 13364.75 13466.52
02/28/87 13501.82 13998.45
03/31/87 13913.04 14403.00
04/30/87 13509.44 14274.81
05/31/87 13646.51 14399.01
06/30/87 14080.58 15126.15
07/31/87 14659.34 15893.05
08/31/87 14948.72 16485.86
09/30/87 14567.96 16124.82
10/31/87 11917.85 12651.53
11/30/87 11377.17 11609.05
12/31/87 11638.57 12492.50
01/31/88 12561.85 13018.43
02/29/88 12979.09 13625.09
03/31/88 12748.28 13204.07
04/30/88 12828.17 13350.64
05/31/88 13050.11 13466.79
06/30/88 13946.76 14084.92
07/31/88 13866.86 14031.39
08/31/88 13449.61 13554.33
09/30/88 13893.49 14131.74
10/31/88 14142.06 14524.60
11/30/88 14221.96 14316.90
12/31/88 14281.37 14567.45
01/31/89 15138.80 15633.78
02/28/89 15074.27 15244.50
03/31/89 15387.74 15599.70
04/30/89 15968.58 16409.32
05/31/89 16696.94 17073.90
06/30/89 16835.23 16976.58
07/31/89 17987.70 18509.57
08/31/89 18208.98 18872.35
09/30/89 18227.41 18794.98
10/31/89 17932.38 18358.93
11/30/89 18430.25 18733.46
12/31/89 18991.43 19183.06
01/31/90 17759.09 17895.87
02/28/90 17864.17 18126.73
03/31/90 17883.28 18607.09
04/30/90 17157.25 18141.91
05/31/90 17720.88 19910.75
06/30/90 17892.83 19775.36
07/31/90 17959.70 19712.07
08/31/90 16717.81 17930.10
09/30/90 16593.62 17056.91
10/31/90 16593.62 16983.56
11/30/90 17329.20 18080.70
12/31/90 17739.07 18585.15
01/31/91 18329.70 19395.46
02/28/91 19420.88 20782.24
03/31/91 20041.54 21285.17
04/30/91 20321.85 21336.26
05/31/91 21052.63 22257.98
06/30/91 20401.93 21238.57
07/31/91 21022.60 22228.28
08/31/91 21483.09 22755.09
09/30/91 21573.19 22375.08
10/31/91 21152.74 22674.91
11/30/91 20652.20 21761.11
12/31/91 21941.56 24250.58
01/31/92 21988.77 23799.52
02/29/92 22425.48 24108.91
03/31/92 21870.74 23638.79
04/30/92 22295.64 24333.77
05/31/92 23027.42 24453.01
06/30/92 23039.23 24088.66
07/31/92 23747.40 25073.88
08/31/92 23357.90 24559.87
09/30/92 23275.28 24849.67
10/31/92 23464.13 24936.65
11/30/92 24467.37 25786.99
12/31/92 24898.11 26104.17
01/31/93 25366.41 26323.44
02/28/93 26094.88 26681.44
03/31/93 26927.42 27244.42
04/30/93 26407.09 26585.11
05/31/93 27044.50 27297.59
06/30/93 27291.66 27376.75
07/31/93 27890.05 27267.24
08/31/93 29646.18 28300.67
09/30/93 29555.12 28082.76
10/31/93 30504.74 28664.07
11/30/93 29229.91 28391.76
12/31/93 30144.64 28735.30
01/31/94 30432.42 29712.30
02/28/94 29382.03 28907.10
03/31/94 28274.09 27646.75
04/30/94 28504.31 28000.63
05/31/94 28590.65 28459.84
06/30/94 28590.65 27762.57
07/31/94 29310.09 28673.18
08/31/94 29497.14 29848.78
09/30/94 29108.65 29117.49
10/31/94 28820.87 29772.63
11/30/94 27943.15 28688.31
12/31/94 28229.77 29113.76
01/31/95 29457.15 29868.68
02/28/95 30235.49 31032.66
03/31/95 30519.88 31948.44
04/30/95 31193.44 32889.32
05/31/95 32031.66 34203.90
06/30/95 33723.05 34998.46
07/31/95 34890.56 36159.01
08/31/95 35893.42 36249.77
09/30/95 37150.73 37779.51
10/31/95 37016.02 37644.64
11/30/95 38033.85 39297.24
12/29/95 39167.58 40054.10

$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity Advisor
Strategic Opportunities Fund - Initial Class on December 31, 1985, and paid
the current maximum 3.50% sales charge. As the chart shows, by December 31,
1995, the value of your investment would have grown to $39,168 - a 291.68%
increase on your initial investment. For comparison, look at how the S&P
500 did over the same period. With dividends reinvested, the same $10,000
investment would have grown to $40,054 - a 300.54% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can
ride out the market's ups and
downs, you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW

MARKET RECAP
Strong corporate earnings and a
favorable interest rate
environment helped the U.S.
stock market post robust returns
for the 12 months ended
December 31, 1995. The Standard
& Poor's Composite Index of 500
Stocks finished the 12-month
period with a total return of
37.58% (including reinvested
dividends ) - well above its
historical annual average of
roughly 12%. With inflation
posing little threat, interest rates
fell during the first half of 1995.
The Federal Reserve Board cut
the fed funds rate - the rate
banks charge each other for
overnight loans - twice, in July
and December.
Large-capitalization stocks led
the rally, with the weak dollar
helping to bolster overseas
business. Technology companies
posted the strongest earnings
growth and stock price gain,
although they faltered somewhat
in the fourth quarter. Lower
interest rates and continued
merger and acquisition activity
helped financial stocks perform
well. In November, the Dow Jones
Industrial Average closed above
5000 for the first time. Returns
from foreign markets suffered as
investors brought capital back to
the U.S. The Morgan Stanley
Emerging Markets Free Index
was down 5.21% for the 12
months ended December 31. The
Morgan Stanley EAFE (Europe,
Australasia, Far East) Index was
up 11.21% for the year. European
markets fared well through 1995,
while the Japanese market
recently has shown signs of
recovery.
An interview with Daniel R. Frank Portfolio Manager of Fidelity Advisor
Strategic Opportunities Fund
Q. DAN, HOW DID THE FUND PERFORM OVER THE PAST 12 MONTHS?
A. The fund performed well, with Initial Class shares returning 38.75%
during the year ended December 31, 1995. During the same period, the
average capital appreciation fund returned 30.34%, according to Lipper
Analytical Services.
Q. THE PAST YEAR'S MARKET SUCCESS WAS LED, TO A GREAT DEGREE, BY TECHNOLOGY
STOCKS. SINCE YOUR TECHNOLOGY HOLDINGS WERE NEGLIGIBLE DURING THE PERIOD,
WHAT FACTORS CONTRIBUTED TO THE FUND'S PERFORMANCE?
A. The story is nearly identical to our discussion in the semiannual report
at the end of June. In short, it's the three "Bs" - the Bells, banks and
bonds. The regional Bell operating companies (RBOCs) were spectacular,
standing as one of the best-performing sectors in the market last year.
Regional banks were one of the top performing sectors, as well. Also,
interest rates continued to come down, helping the long-term Treasury
position. Zero coupon bonds - which tend to be extremely sensitive to
changes in interest rates - were the fund's largest holding as of the end
of the period and outperformed the S&P 500.
Q. ALMOST ONE QUARTER OF THE FUND'S HOLDINGS WAS RBOCS - ABOUT THE SAME AS
SIX MONTHS AGO. THEIR PERFORMANCE CONTINUED TO BE SUPERIOR . . .
A. Nothing really has changed. BellSouth, Ameritech, Bell Atlantic, NYNEX
and SBC Communications remain among the fund's 10 largest holdings.
Revenue, earnings and dividend growth continued to be strong. Legislation
at the state levels continued to be favorable. Federal legislation, though
still pending, may help to allow the RBOCs to get into the long-distance
business while de-regulating the rest of their business. You have a
combination of continued growth in phone lines and such enhanced services
as voice mail, as well as increasing returns from the cellular and overseas
components of their operations. Further, by default, the RBOCs are the
Internet access providers. By this I mean that as people log-in to the
information superhighway, they're adding second and third phone lines at
home. Over the past decade, the total return from the RBOCs has been
substantially more than the S&P 500.
Q. ON THE OTHER HAND, YOU TRIMMED THE FUND'S HOLDING IN FINANCIAL SERVICES
ALMOST IN HALF - TO 14%. WHY?
A. If you look at the fund's history in recent years, you'll see that at
different times I've held big positions in this sector and also have had
less than 10% of the fund's holdings in financial services. Banks, for
example, tend to do well when interest rates come down. The underlying
fundamentals of their loan portfolios, however, had me nervous at the end
of the period. Consumer credit quality has been deteriorating and there has
been no loan growth. Banks have not performed well in the past when faced
with similar conditions.
Q. YOU INCREASED THE FUND'S HOLDINGS IN THE MEDIA AND LEISURE SECTOR. WHAT
DID YOU SEE THAT MADE THIS MARKET SEGMENT ATTRACTIVE?
A. The holdings in this sector during the period were mostly newspapers - a
new story for the fund - with a lot of new names added. These new holdings
included Gannett, Knight-Ridder and News Corp. These stocks have done
little over the past decade and have had their earnings depressed by the
dramatic rise in newsprint prices over the past three years. Many of these
companies generate substantial excess cash which has been and can continue
to be used to benefit shareholders. Icing on the cake would be a decline in
newsprint prices.
Q. WERE THERE ANY DISAPPOINTMENTS DURING THE PERIOD?
A. Going into 1995, I probably would have been happy with a return of 10%.
Still, Viacom, which was one of the fund's top holdings during the period
was a disappointment, particularly given its sizable assets, strong cash
flow and improving balance sheet. Kinder-Care Learning Centers, a provider
of day care services which the fund no longer held at the end of the
period, was another disappointment.
Q. WHAT'S YOUR STRATEGY GOING FORWARD?
A. It's extremely difficult to make accurate predictions about the future
of the securities markets. I think the market's performance during 1995 -
surpassing just about everyone's expectations - is perfect evidence of
that. As always, however, I will continue to seek out and invest in those
companies and market sectors where I believe there is value and the
opportunity for capital appreciation.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.

TOP TEN STOCKS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

BellSouth Corp. 5.4 5.1

Ameritech Corp. 5.1 5.0

Bell Atlantic Corp. 4.9 4.9

I-Stat Corp. 4.7 7.2

NYNEX Corp. 4.6 4.3

SBC Communications, Inc. 4.4 4.7

Viacom, Inc. (various issues) 4.3 5.3

Philip Morris Companies, Inc. 2.3 0.0

Tootsie Roll Industries, Inc. 1.7 1.5

Regis Corp. 1.2 1.4

TOP FIVE MARKET SECTORS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET SECTORS
6 MONTHS AGO

Utilities 25.9 26.0

Finance 14.0 24.4

Media & Leisure 8.8 6.0

Nondurables 8.8 4.5

Health 6.0 10.6

Showing Percentage of Total Value of Investments in Securities

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS DECEMBER 31, 1995

Investment in securities, at value (including repurchase $ 752,341,103
agreements of $39,414,000) (cost $623,837,619) -
See accompanying schedule

Cash 1,667

Receivable for investments sold 12,075,751

Receivable for fund shares sold 6,699,232

Dividends receivable 1,256,090

Interest receivable 230,632

Other receivables 101,210

Prepaid expenses 8,975

TOTAL ASSETS 772,714,660

LIABILITIES

Payable for investments purchased $ 15,531,409

Payable for fund shares redeemed 443,369

Distributions payable 4,222,435

Accrued management fee 375,779

Distribution fees payable 409,732

Other payables and accrued expenses 315,934

TOTAL LIABILITIES 21,298,658

NET ASSETS $ 751,416,002

Net Assets consist of: $ 609,715,457
Paid in capital

Accumulated undistributed net realized gain (loss) on 13,197,061
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 128,503,484
investments

NET ASSETS $ 751,416,002

CALCULATION OF MAXIMUM OFFERING PRICE $24.88
CLASS A:
NET ASSET VALUE, and redemption price per share
($619,992,880 (divided by) 24,920,869 shares)

Maximum offering price per share (100/95.25 of $24.88) $26.12

CLASS B: $24.56
NET ASSET VALUE, offering price and redemption price
per share ($87,565,658 (divided by) 3,565,455 shares) A

INSTITUTIONAL CLASS: $24.80
NET ASSET VALUE, offering price and redemption price
per share ($20,429,118 (divided by) 823,752 shares)

INITIAL CLASS: $25.10
NET ASSET VALUE and redemption price per share
($23,428,346 (divided by) 933,228 shares)

Maximum offering price per share (100/95.25 of $25.10) $26.35

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME YEAR ENDED DECEMBER 31, 1995

Dividends $ 11,406,495

Interest 8,282,971

TOTAL INCOME 19,689,466

EXPENSES

Management fee $ 3,419,543
Basic fee

Performance adjustment 91,269

Transfer agent fees 1,162,980
Class A

Class B 126,686

Institutional Class 4,398

Initial Class 44,511

Distribution fees - Class A 3,182,013

Distribution fees - Class B 467,105

Accounting fees and expenses 315,623

Non-interested trustees' compensation 3,060

Custodian fees and expenses 42,292

Registration fees - Class A 76,078

Registration fees - Class B 61,368

Registration fees - Institutional Class 17,791

Registration fees - Initial Class 23,362

Audit 37,973

Legal 31,273

Interest 948

Reports to shareholders 29,651

Miscellaneous 2,006

Total expenses before reductions 9,139,930

Expense reductions (38,211) 9,101,719

NET INVESTMENT INCOME 10,587,747

REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:

Investment securities (including realized loss of 36,075,671
$246,335 on sales of investment in affiliated issuers)

Foreign currency transactions (11,657) 36,064,014

Change in net unrealized appreciation (depreciation) on:

Investment securities 132,488,727

Assets and liabilities in foreign currencies 10,596 132,499,323

NET GAIN (LOSS) 168,563,337

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 179,151,084
OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C> <C>
YEAR ENDED THREE MONTHS YEAR ENDED
DECEMBER 31, ENDED SEPTEMBER 30,
1995 DECEMBER 31, 1994
1994

INCREASE (DECREASE) IN NET ASSETS

Operations $ 10,587,747 $ 2,067,920 $ 6,903,469
Net investment income

Net realized gain (loss) 36,064,014 (5,789,778) 8,280,193

Change in net unrealized appreciation 132,499,323 (9,641,386) (23,325,658)
(depreciation)

NET INCREASE (DECREASE) IN NET ASSETS 179,151,084 (13,363,244) (8,141,996)
RESULTING FROM OPERATIONS

Distributions to shareholders (9,290,408) (6,826,359) (5,752,632)
From net investment income
Class A

Class B (1,281,036) (382,214) -

Institutional Class (433,848) - -

Initial Class (449,705) (464,141) (458,027)

From net realized gain (13,102,251) (5,071,018) (22,876,692)
Class A

Class B (1,854,130) (211,573) -

Institutional Class (433,848) - -

Initial Class (494,507) (241,353) (1,535,740)

TOTAL DISTRIBUTIONS (27,339,733) (13,196,658) (30,623,091)

Share transactions - net increase 189,241,269 23,899,770 161,198,427
(decrease)

TOTAL INCREASE (DECREASE) IN NET ASSETS 341,052,620 (2,660,132) 122,433,340

NET ASSETS

Beginning of period 410,363,382 413,023,514 290,590,174

End of period (including undistributed $ 751,416,002 $ 410,363,382 $ 413,023,514
net investment income of $0,
$0, and $5,875,182 respectively)

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - CLASS A YEAR ENDED THREE MONTHS YEARS ENDED SEPTEMBER 30,
DECEMBER 31, ENDED
DECEMBER 31,

SELECTED PER-SHARE DATA 1995 1994 1994 G 1993 1992 D 1991

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 18.70 $ 19.96 $ 22.52 $ 19.53 $ 21.38 $ 17.21

Income from Investment Operations

Net investment income .39 .10 F .39 F .33 .61 .66

Net realized and unrealized gain (loss) 6.73 (.75) (.81) 4.44 .58 4.26

Total from investment operations 7.12 (.65) (.42) 4.77 1.19 4.92

Less Distributions

From net investment income (.39) (.35) (.43) (.57) (.62) (.75)

From net realized gain (.55) (.26) (1.71) (1.21) (2.42) -

Total distributions (.94) (.61) (2.14) (1.78) (3.04) (.75)

Net asset value, end of period $ 24.88 $ 18.70 $ 19.96 $ 22.52 $ 19.53 $ 21.38

TOTAL RETURN B, C 38.16% (3.26)% (2.24)% 26.33% 7.26% 29.51%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 619,993 $ 375,691 $ 385,349 $ 269,833 $ 194,710 $ 199,604

Ratio of expenses to average net assets 1.61% 1.73% A, 1.85% 1.57% 1.46% 1.56%
H E

Ratio of expenses to average net assets after expense
reductions 1.61% I 1.73% A, 1.84% 1.57% 1.46% 1.56%
I I

Ratio of net investment income to average net assets 1.90% 2.03% A 1.89% 2.06% 3.22% 3.61%

Portfolio turnover 142% 228% A 159% 183% 211% 223%

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C>
YEAR ENDED THREE YEAR ENDED
DECEMBER MONTHS SEPTEMBER
31, ENDED 30,
DECEMBER
31,

1995 1994 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 18.57 $ 19.98 $ 19.65

Income from Investment Operations

Net investment income .38 .06 E .05 E

Net realized and unrealized gain (loss) 6.54 (.74) .28

Total from investment operations 6.92 (.68) .33

Less Distributions

From net investment income (.38) (.47) -

From net realized gain (.55) (.26) -

Total distributions (.93) (.73) -

Net asset value, end of period $ 24.56 $ 18.57 $ 19.98

TOTAL RETURN B, C 37.35% (3.41)% 1.68%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 87,566 $ 17,090 $ 8,824

Ratio of expenses to average net assets 2.11% 2.58% A 2.63% A,
G

Ratio of expenses to average net assets after 2.10% F 2.53% A, 2.63% A
expense reductions F

Ratio of net investment income to average net 1.40% 1.22% A 1.11% A
assets

Portfolio turnover 142% 228% A 159%

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS - INITIAL CLASS YEAR ENDED THREE MONTHS YEARS ENDED SEPTEMBER 30,
DECEMBER 31, ENDED
DECEMBER 31,

SELECTED PER-SHARE DATA 1995 1994 1994 G 1993 1992 D 1991

</TABLE>

Net asset value, beginning of period $ 18.86 $ 20.23 $ 22.72 $ 19.72 $ 21.55 $ 17.37

Income from Investment Operations

Net investment income .50 .13 F .54 F .45 .73 .77

Net realized and unrealized gain (loss) 6.79 (.74) (.81) 4.46 .58 4.26

Total from investment operations 7.29 (.61) (.27) 4.91 1.31 5.03

Less Distributions

From net investment income (.50) (.50) (.51) (.70) (.72) (.85)

From net realized gain (.55) (.26) (1.71) (1.21) (2.42) -

Total distributions (1.05) (.76) (2.22) (1.91) (3.14) (.85)

Net asset value, end of period $ 25.10 $ 18.86 $ 20.23 $ 22.72 $ 19.72 $ 21.55

TOTAL RETURN B, C 38.75% (3.02)% (1.51)% 26.98% 7.89% 30.01%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 23,428 $ 17,583 $ 18,850 $ 20,707 $ 17,933 $ 19,193

Ratio of expenses to average net assets 1.04% 1.14% A 1.15% .89% .87% 1.00%

Ratio of expenses to average net assets after expense reductions 1.03% 1.11% A, 1.14% .89% .87% 1.00%

H H H

Ratio of net investment income to average net assets 2.47% 2.65% A 2.6% 2.74% 3.78% 4.12%

Portfolio turnover 142% 228% A 159% 183% 211% 223%

</TABLE>

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO FINANCIAL
STATEMENTS).
D AS OF OCTOBER 1, 1991 THE FUND DISCONTINUED THE USE OF EQUALIZATION
ACCOUNTING.
E INCLUDES REIMBURSEMENT OF $.03 PER SHARE FROM FIDELITY MANAGEMENT &
RESEARCH COMPANY FOR ADJUSTMENTS TO PRIOR PERIOD'S FEES.
F NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
G EFFECTIVE OCTOBER 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
H FMR HAS DIRECTED CERTAIN PORTFOLIO TRADES TO BROKERS WHO PAID A PORTION
OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS

<TABLE>
<CAPTION>
<S> <C>
YEAR ENDED
DECEMBER 31,

1995 B

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 22.35

Income from Investment Operations

Net investment income .55

Net realized and unrealized gain (loss) 3.00

Total from investment operations 3.55

Less Distributions

From net investment income (.55)

From net realized gain (.55)

Total distributions (1.10)

Net asset value, end of period $ 24.80

TOTAL RETURN C, D 15.96%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 20,429

Ratio of expenses to average net assets .97% A

Ratio of expenses to average net assets after expense reductions .96% A,
E

Ratio of net investment income to average net assets 2.55% A

Portfolio turnover 142%

</TABLE>

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
William J. Hayes, Vice President
Daniel R. Frank, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Robert H. Morrison, Manager,
Security Transactions
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company
Boston, MA
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
GROWTH FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Growth
Opportunities Fund
Fidelity Advisor Strategic
Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Income Fund
Fidelity Advisor Income & Growth Fund
TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund
MUNICIPAL FUNDS
Fidelity Advisor High Income
Municipal Fund
Fidelity Advisor Intermediate Municipal Income Fund
Fidelity Advisor Short-Intermediate Municipal Income Fund
STATE MUNICIPAL FUNDS
Fidelity Advisor New York Municipal Income Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)
(registered trademark)
* INDEPENDENT TRUSTEES

(2_FIDELITY_LOGOS)FIDELITY ADVISOR
(registered trademark)

EMERGING MARKETS INCOME
FUND - CLASS A AND CLASS B
ANNUAL REPORT
DECEMBER 31, 1995
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.

PERFORMANCE 4 How the fund has done over time.

FUND TALK 11 The manager's review of fund
performance, strategy and outlook.

INVESTMENT CHANGES 14 A summary of major shifts in the
fund's investments over the past six
months.

INVESTMENTS 15 A complete list of the fund's
investments with their market
values.

FINANCIAL STATEMENTS 20 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 26 Notes to the financial statements.

REPORT OF INDEPENDENT 33 The auditors' opinion.
ACCOUNTANTS

DEAR SHAREHOLDER:
Although the markets were fairly positive in 1995, no one can predict what
lies ahead for investors. The previous year, stocks posted below-average
returns and bonds had one of the worst years in history. This downturn
followed a period in which the investing environment was generally very
positive.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
Keeping in mind that the effects of interest rate changes on your bond
investments will only be "paper" gains or losses unless you sell your
shares, staying in your bond fund may be appropriate if your investment
horizon is at least a year or more. The longer your investing time frame,
the more likely it is that you will retain your principal investment
through both up and down markets. For example, a 10-year time frame, such
as saving
for a college education, enables you to weather these ups and downs in a
long-term fund, which has higher potential returns. An intermediate-length
fund could be appropriate if your investment horizon is two to four years,
and a short-term bond fund could be the right choice if you need your money
in one or two years.
If your time horizon is less than a year, you might want to consider moving
some of your bond investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
No matter what your investment horizon or portfolio diversity, it makes
good sense to follow a regular investment plan - investing a certain amount
of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
Remember to contact your investment professional if you need help with your
investments.
Best regards,
Edward C. Johnson 3d
ADVISOR EMERGING MARKETS INCOME FUND - CLASS A
PERFORMANCE: THE BOTTOM LINE

Advisor Emerging Markets Income - Class A 6.99% 9.63%

Advisor Emerging Markets Income - Class A
(incl. max. 3.50% sales charge) 1 3.24% 5.79%

JP Morgan Emerging Markets Bond Index 27.54% 14.37%

JP Morgan Emerging Markets Bond Index Plus 26.78% 13.59%

Average Emerging Market Debt Fund 20.12% n/a

CUMULATIVE TOTAL RETURNS show Class A's performance in percentage terms
over a set period - in this case, one year, or since the fund started on
March 10, 1994. 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 those of the JP Morgan
Emerging Markets Bond Index or the JP Morgan Emerging Markets Bond Index
Plus- both broad measures of bond performance in developing countries. To
measure how Class A's performance stacked up against its peers, you can
compare it to the average emerging market debt fund, which reflects the
performance of 12 funds with similar objectives tracked by Lipper
Analytical Services over the past 12 months. These benchmarks include
reinvested dividends and capital gains, if any, and exclude the effects of
sales charges. Recent U.S. Consumer Price Index (CPI) information is not
available from the U.S. Department of Labor. Therefore, the CPI comparison
has not been included in this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Emerging Markets Income - Class A 6.99% 5.20%

Advisor Emerging Markets Income - Class A
(incl. max. 3.50% sales charge) 1 3.24% 3.15%

JP Morgan Emerging Markets Bond Index 27.54% 7.68%

JP Morgan Emerging Markets Bond Index Plus 26.78% 7.28%

Average Emerging Market Debt Fund 20.12% n/a

AVERAGE ANNUAL TOTAL RETURNS take Class A shares' actual (or cumulative)
return and show you what would have happened if Class A shares had
performed at a constant rate each year.

1 HAD THE FORMER MAXIMUM 4.75% SALES CHARGE BEEN REFLECTED, THE CUMULATIVE
AND AVERAGE ANNUAL TOTAL RETURNS FOR THE PAST ONE YEAR AND LIFE OF FUND
WOULD HAVE BEEN 1.90% AND 1.90%, AND 4.42% AND 2.41%, RESPECTIVELY.
$10,000 OVER LIFE OF FUND
FA Emerg Mkt Inc (63jp004
03/31/94 9650.00 10,000.00
04/30/94 9776.98 9,813.15
05/31/94 10407.21 10,538.52
06/30/94 9903.49 10,003.24
07/31/94 10125.69 10,185.84
08/31/94 11345.66 11,028.96
09/30/94 11669.61 11,369.80
10/31/94 11368.84 11,010.46
11/30/94 11132.57 10,998.76
12/31/94 10317.99 10,286.30
01/31/95 9133.41 9,790.86
02/28/95 8480.64 9,335.47
03/31/95 8232.63 9,147.30
04/30/95 8939.42 10,126.09
05/31/95 9472.72 11,007.34
06/30/95 9526.09 11,250.30
07/31/95 9542.31 11,205.93
08/31/95 9746.69 11,512.64
09/30/95 10134.47 11,962.72
10/31/95 10057.87 11,832.85
11/30/95 10393.81 12,176.52
12/31/95 11038.86 13,039.94

$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Fidelity
Advisor Emerging Markets Income Fund - Class A on March 31, 1994, shortly
after the fund started, and paid the current maximum 3.50% sales charge. As
the chart shows, by December 31, 1995, the value of your investment would
have grown to $11,039 - a 10.39% increase on your initial investment. For
comparison, look at how the JP Morgan Emerging Markets Bond Index Plus did
over the same period. With dividends reinvested, the same $10,000
investment would have grown to $13,040 - a 30.40% increase.
Beginning with this report, the fund will compare its performance to the JP
Morgan Emerging Markets Bond Index Plus rather than the JP Morgan Emerging
Markets Bond Index. The JP Morgan Emerging Markets Bond Index Plus includes
corporate bonds and local currency bonds, and is more representative of the
fund's investable universe. For comparison purposes, both indices are shown
on page 4.
UNDERSTANDING
PERFORMANCE
Many markets around the globe
offer the potential for significant
growth over time; however,
investing in foreign markets means
assuming greater risks than
investing in the United States.
Factors like changes in a
country's financial markets, its
local political and economic
climate, and the fluctuating value
of its currency create these risks.
For these reasons an international
fund's performance may be more
volatile than a fund that invests
exclusively in the United States.
Past performance is no guarantee
of future results and you may have
a gain or loss when you sell your
shares.
(checkmark)

TOTAL RETURN COMPONENTS
YEAR ENDED MARCH 10, 1994
DECEMBER 31, (COMMENCEMENT
1995 OF FUND
OPERATIONS) TO
DECEMBER 31, 1994

Dividend return 9.51% 4.80%

Capital appreciation return -2.52% -2.33%

Total return 6.99% 2.47%

DIVIDEND returns and capital appreciation returns are both part of a class'
total return. A dividend return reflects the actual dividends paid by the
class. A capital appreciation return reflects both the amount paid by the
class to shareholders as capital gain distributions and changes in the
class' share price. Both returns assume the dividends or gains are
reinvested and exclude the effects of sales charges.
DIVIDENDS AND YIELD
PERIODS ENDED DECEMBER 31, 1995 PAST PAST 6 PAST 1
MONTH MONTHS YEAR

Dividends per share 6.61(cents) 38.45(cents) 77.73(cents)

Annualized dividend rate 8.66% 8.87% 9.38%

30-day annualized yield 9.86% - -

DIVIDENDS per share show the income paid by the class for a set period. If
you annualize this number, based on an average net asset value of $8.99
over the past month, $8.60 over the past six months and $8.29 over the past
year, you can compare the class' income distributions over these three
periods. The 30-day annualized YIELD is a standard formula for all bond
funds based on the yields of the bonds in the fund, averaged over the past
30 days. This figure shows you the yield characteristics of the fund's
investments at the end of the period. It also helps you to compare funds
from different companies on an equal basis. The offering share price used
in the calculation of the yield includes the effect of Class A's maximum
3.50% sales charge. If Fidelity had not reimbursed certain Class A expenses
during the period shown, the yield would have been 9.78%. Had Class A's
prior 4.75% sales charge been reflected, the 30-day annualized yield and
restated yield (excluding reimbursement of expenses) would have been 9.74%
and 9.67%, respectively.
ADVISOR EMERGING MARKETS INCOME FUND - CLASS B
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate historical performance. You can look at
the total percentage change in value, the average annual percentage change,
or the growth of a hypothetical $10,000 investment. A fund's total return
includes changes in share price, plus reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells
securities that have grown in value). You can also look at income to
measure performance.
The initial offering of Class B shares took place on June 30, 1994. Class B
shares bear a 0.90% 12b-1/shareholder service fee. Prior
to January 1, 1996, this fee was 1.00%, which is reflected in the returns
for the period after June 30, 1994. Returns prior to June 30, 1994 are
those of Class A, the original class of the fund and reflect Class A's
0.25% 12b-1 fee. Had Class B's 12b-1 fee been reflected, returns prior to
June 30, 1994 would have been lower. If Fidelity had not reimbursed certain
class expenses during the periods shown, the total returns and dividends
would have been lower. Class B's contingent deferred sales charges included
in the past one year and life of fund total return figures are 4% and 3%
respectively.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Emerging Markets Income - Class B 6.38% 8.46%

Advisor Emerging Markets Income - Class B 2.47% 5.67%
(incl. contingent deferred sales charge)

JP Morgan Emerging Markets Bond Index 27.54% 14.37%

JP Morgan Emerging Markets Bond Index Plus 26.78% 13.59%

Average Emerging Market Debt Fund 20.12% n/a

CUMULATIVE TOTAL RETURNS show Class B's performance in percentage terms
over a set period - in this case, one year, or since the fund started on
March 10, 1994. 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 those of the JP Morgan
Emerging Market Bond Index or the JP Morgan Emerging Markets Bond Index
Plus - both broad measures of the bond performance in developing countries.
To measure how Class B's performance stacked up against its peers, you can
compare it to the average emerging market debt fund, which currently
reflects the performance of 12 funds tracked by Lipper Analytical Services
over the past 12 months. These benchmarks include reinvested dividends and
capital gains, if any, and exclude the effects of sales charges. Recent
U.S. Consumer Price Index (CPI) Information is not available from the U.S.
Department of Labor. Therefore, the CPI comparison has not been included in
this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Emerging Markets Income - Class B 6.38% 4.58%

Advisor Emerging Markets Income - Class B 2.47% 3.09%
(incl. contingent deferred sales charge)

JP Morgan Emerging Markets Bond Index 27.54% 7.68%

JP Morgan Emerging Markets Bond Index Plus 26.78% 7.28%

Average Emerging Market Debt Fund 20.12% n/a

AVERAGE ANNUAL TOTAL RETURNS take Class B shares' actual (or cumulative)
return and show you what would have happened if Class B shares had
performed at a constant rate each year.
$10,000 OVER LIFE OF FUND
FAEmerg Mkt Inc- Cl jp004
03/31/94 10000.00 10,000.00
04/30/94 10131.58 9,813.15
05/31/94 10784.67 10,538.52
06/30/94 10262.68 10,003.24
07/31/94 10479.19 10,185.84
08/31/94 11731.96 11,028.96
09/30/94 12068.80 11,369.80
10/31/94 11760.43 11,010.46
11/30/94 11498.08 10,998.76
12/31/94 10638.87 10,286.30
01/31/95 9433.23 9,790.86
02/28/95 8743.94 9,335.47
03/31/95 8483.25 9,147.30
04/30/95 9205.14 10,126.09
05/31/95 9746.94 11,007.34
06/30/95 9806.96 11,250.30
07/31/95 9817.26 11,205.93
08/31/95 10020.77 11,512.64
09/30/95 10400.35 11,962.72
10/31/95 10326.94 11,832.85
11/30/95 10664.24 12,176.52
12/29/95 11026.01 13,039.94

$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Fidelity
Advisor Emerging Markets Income Fund - Class B on March 31, 1994, shortly
after the fund started and paid the applicable contingent deferred sales
charge upon redemption at the end of the period. As the chart shows, by
December 31, 1995, the value of your investment would have grown to $11,026
- - a 10.26% increase on your initial investment. For comparison, look at how
the JP Morgan Emerging Markets Bond Index Plus did over the same period.
With dividends reinvested, the same $10,000 investment would have grown to
$13,040 - a 30.40% increase.
Beginning with this report, the fund will compare its performance to the JP
Morgan Emerging Markets Bond Index Plus rather than the JP Morgan Emerging
Markets Bond Index. The JP Morgan Emerging Markets Bond Index Plus includes
corporate bonds and local currency bonds, and is more representative of the
fund's investable universe. For comparison purposes, both indices are shown
on page 8.
UNDERSTANDING
PERFORMANCE
Many markets around the globe
offer the potential for significant
growth over time; however,
investing in foreign markets
means assuming greater risks
than investing in the United
States. Factors like changes in a
country's financial markets, its
local political and economic
climate, and the fluctuating value
of its currency create these risks.
For these reasons an
international fund's performance
may be more volatile than a fund
that invests exclusively in the
United States. Past performance
is no guarantee of future results
and you may have a gain or loss
when you sell your shares.
(checkmark)
TOTAL RETURN COMPONENTS
YEAR ENDED MARCH 10, 1994
DECEMBER 31, (COMMENCEMENT OF
1995 FUND OPERATIONS) TO
DECEMBER 31, 1994

Dividend return 8.69% 4.30%

Capital appreciation return -2.31% -2.34%

Total return 6.38% 1.96%

Dividends per share 6.03(cents) 35.12(cents) 71.25(cents)

Annualized dividend rate 7.88% 8.08% 8.57%

30-day annualized yield 9.45% - -

DIVIDENDS per share show the income paid by the class for a set period. If
you annualize this number, based on an average net asset value of $9.01
over the past month, $8.62 over the past six months, and $8.31 over the
past year, you can compare the class' income distributions over these three
periods. The 30-day annualized YIELD is a standard formula for all bond
funds based on the yields of the bonds in the fund, averaged over the past
30 days. This figure shows you the yield characteristics of the fund's
investments at the end of the period. It also helps you compare funds from
different companies on an equal basis. The offering share price used in the
calculation of the yield excludes the effect of Class B's contingent
deferred sales charge. If Fidelity had not reimbursed certain Class B
expenses during the period shown, the yield would have been 9.38%.
FUND TALK: THE MANAGER'S OVERVIEW

MARKET RECAP
Both developed and emerging
fixed-income markets recorded
strong returns in 1995. For the
12 months ended December 31,
1995, the Salomon Brothers World
Government Bond Index - a
proxy of government bond market
performance in developed nations
including the U.S. - rose
19.04%. Emerging markets
shrugged off the fallout from
December 1994's Mexican peso
devaluation to record strong
returns. The J.P. Morgan Emerging
Markets Bond Index posted a
27.54% return for the year. To
compare, the Lehman Brothers
Aggregate Bond Index - a broad
measure of taxable bonds in the
U.S. market - had a total return of
18.47%. Bond markets in
developed countries benefited
from slow economic growth and
relatively low inflation pressures.
This led to a more favorable interest
rate environment, as the central
banks of the U.S., Germany and
Great Britain all lowered their
respective short-term interest
rates. Record low interest rates
in Japan and a strengthening
dollar pushed a significant amount
of money into the U.S., as overseas
investors in 1995 purchased a
record net $99.4 billion in U.S.
Treasury securities - helping fuel
the U.S. rally. The bulk of emerging
markets' total return came from a
springtime rally following the
announcement of a $50 billion
bailout package for Mexico by the
U.S. Treasury and the International
Monetary Fund.
An interview with John Carlson, Portfolio Manager of Fidelity Advisor
Emerging Markets Income Fund
Q. HOW DID THE FUND PERFORM, JOHN?
A. For the 12-months ended December 31, 1995, the fund's Class A and B
shares returned 6.99% and 6.38%, respectively. For comparison purposes, the
J.P. Morgan Emerging Markets Bond Index Plus returned 26.78% and the
average emerging market debt fund, according to Lipper Analytical Services,
returned 20.12%. In stark contrast to the first six months of 1995,
however, in the past six months the fund posted a 15.88% and 15.40% gain
for its Class A and B shares. At the same time, the index returned 15.91%
and the average emerging market debt fund returned 15.82%.
Q. WOULD YOU DESCRIBE WHAT THE EMERGING DEBT MARKET WAS LIKE THIS PAST
YEAR?
A. Sure. As described in the fund's semiannual report in June, we came into
1995 with the Mexican peso devaluation having cast a pall over most
emerging markets. The emerging debt markets rebounded, however, with a
springtime rally following the announcement of a support package from the
international community for Argentina and Mexico. In general, all
fixed-income markets benefited from slow economic growth, stable interest
rates and relatively low inflation pressures. This became particularly
evident when the central banks of the U.S., Germany and Great Britain all
lowered their respective short-term interest rates. Although returns in
emerging debt markets remained positive, there was a market consolidation
from May to the middle of November. Finally, from November to the end of
year, emerging market bonds rallied, spurred by international investors
seeking higher yields.
Q. SO HOW WAS THE FUND MANAGED IN THIS DYNAMIC ENVIRONMENT?
A. When I began managing the fund in June, it had a significant cash
position. I put that cash to work in Latin American corporate bonds. As
investors recognized the value of these bonds, they appreciated in value
and their spreads - the difference in yield compared to U.S. Treasury bonds
- - tightened. I then sold these corporates and bought Brady bonds of Brazil.
Country rotation from Brazil to Argentina to Mexico became the theme for
the rest of the year.
Q. SHOULD ONE ASSUME THAT BECAUSE YOU TOOK PROFITS MAINLY IN THE SOUTH
AMERICAN POSITIONS, THAT YOU ARE NO LONGER OPTIMISTIC ABOUT THIS AREA OF
THE WORLD?
A. Absolutely not. I always look at individual securities on a relative
value basis. That said, the fund's largest positions are still in Argentina
and Brazil. These countries have embarked on ambitious privatization
programs of state industries as well as fiscal reforms.
Q. WHAT WERE SOME OTHER APPEALING AREAS OF THE MARKET FOR THE FUND?
A. Although the fund had a very small position in Southeast Asia, loans
from Vietnam and bonds from Indonesia performed well during the period.
Additionally, the fund participated in this year's rally in South African
bonds. Aside from the bonds the fund is allowed to own, it also has a
significant interest in loan participations. Loans generally performed
well, with those from Panama, Peru and Russia particularly benefiting the
fund.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. There were very few. The largest was the fact that the fund held a large
cash position during the emerging debt market rally this past spring. Thus,
the fund did not fully participate in the rebound.
Q. WHAT'S YOUR OUTLOOK?
A. I am optimistic about emerging market debt. Stable interest rates in the
developed world coupled with tight fiscal and monetary policies in emerging
countries may attract more capital. However, I will continue to monitor the
economies, politics and interest rates that can radically effect the
emerging markets.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.

FUND FACTS
GOAL: a high level of current
income by investing primarily
in debt securities and other
instruments of issuers in
emerging markets. As a
secondary objective, the
fund seeks capital
appreciation
START DATE: March 10, 1994
SIZE: as of December 31,
1995, more than $45 million
MANAGER: John Carlson,
since June 1995; manager,
Fidelity Advisor Strategic
Income since October 1995;
joined Fidelity in June 1995
(checkmark)
JOHN CARLSON ON BRADY BONDS:
"Brady bonds - which are
named after former Bush
administration Treasury
Secretary Nicholas Brady -
are U.S. dollar-denominated
bonds of developing
countries. The Brady bond is
a unique security in that it has
an extremely long duration -
or price sensitivity to changes
in interest rates - and
significant credit exposure. Of
course, one is compensated
for their higher risks with a
higher potential return.
"Being successful in emerging
markets means doing your
homework. First, you need to
consider a country's monetary
policy, fiscal policy and
economic reform
programs. You also have to
look at the demographics of
the country. What's the
strength of its local capital
markets? How good is a
country's savings rate or
education level? What are the
country's infrastructure
needs? How fast can it create
jobs?"
INVESTMENT CHANGES

TOP COUNTRIES AS OF DECEMBER 31, 1995
(EXCLUDING REPURCHASE AGREEMENTS) % OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS 6 MONTHS AGO

Argentina 25.3 16.8

Brazil 18.9 23.1

Mexico 8.3 6.0

Panama 4.9 1.7

Venezuela 4.7 0.0

TOP COUNTRIES ARE BASED ON THE LOCATION OF THE ISSUER OF EACH SECURITY,
INDICATING WHERE THE FUND IS EXPOSED TO POLITICAL AND CREDIT RISKS. THE
FUND'S LARGEST POSITION AS OF DECEMBER 31, 1995 WAS IN SECURITIES OF
ARGENTINEAN ISSUERS.
TOP FIVE HOLDINGS AS OF DECEMBER 31, 1995
(BY ISSUER, EXCLUDING REPURCHASE % OF FUND'S % OF FUND'S
AGREEMENTS) INVESTMENTS INVESTMENTS
6 MONTHS AGO

Argentina Republic 23.1 16.8

Brazil Federative Republic 18.5 21.7

Mexican Government Brady 7.2 4.6

Republic of Venezuela 4.7 0.0

Bank for Foreign Economic
Affairs of the 4.6 2.8
USSR (Vnesheconombank)

AVERAGE YEARS TO MATURITY AS OF DECEMBER 31, 1995
6 MONTHS AGO

Years 13.5 12.2

AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME UNTIL PRINCIPAL
PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS, WEIGHTED BY DOLLAR
AMOUNT.
ASSET ALLOCATION
AS OF DECEMBER 31, 1995 AS OF JUNE 30, 1995
31.
37
Row: 1, Col: 1, Value: 13.4
Row: 1, Col: 2, Value: 11.9
Row: 1, Col: 3, Value: 0.0
Row: 1, Col: 4, Value: 66.2
Row: 1, Col: 5, Value: 8.5
Row: 1, Col: 1, Value: 5.4
Row: 1, Col: 2, Value: 31.8
Row: 1, Col: 3, Value: 2.1
Row: 1, Col: 4, Value: 54.1
Row: 1, Col: 5, Value: 6.6
Corporate bonds 8.5%
Foreign
government
obligations 66.2%
Stocks 0.0%
Short-term
investments 11.9%
Other 13.4%
Corporate bonds 6.6%
Foreign
government
obligations 56.1%
Stocks 0.1%
Short-term
investments 31.8%
Other 5.4%
INVESTMENTS DECEMBER 31, 1995

Showing Percentage of Total Value of Investment in Securities

NONCONVERTIBLE BONDS - 8.5%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (D) AMOUNT (B) (NOTE 1)
ARGENTINA - 2.2%
Invergas SA 12 1/2%, 12/16/99 - $ 450,000 $ 445,500
Sodigas Pampeana SA 10 1/2%, 7/6/99 - 400,000 392,000
Telecom Argentina Stet-France Telecom SA
12%, 11/15/02 (f) B1 215,000 228,975
1,066,475
BRAZIL - 0.4%
Abril SA 12%, 10/25/03 (f) - 200,000 201,250
COLOMBIA - 0.7%
Comunicaciones Celulares SA Unit 0%,
11/15/03 (e)(f) B3 560,000 317,800
CZECH REPUBLIC - 2.1%
BV Finance of Prague 11%, 6/23/97 AAA CZK 15,000,000 566,170
Coca-Cola Amatil Ltd.
12%, 10/25/03 A2 CZK 11,100,000 416,260
982,430
INDONESIA - 1.1%
Tjiwi Kimia International Finance Co.
13 1/4%, 8/1/01 Ba3 500,000 540,000
MEXICO - 1.1%
Empaques Ponderosa SA euro
8 3/4%, 12/6/96 - 115,000 112,554
Grupo Condumex SA de CV:
6 1/4%, 7/27/96 (f) - 100,000 98,000
euro 6 1/4%, 7/27/96 - 300,000 294,000
504,554
SOUTH AFRICA - 0.9%
ESKOM (Electricity Supply Commission)
12%, 5/1/96 Baa3 ZAR 1,500,000 408,051
TOTAL NONCONVERTIBLE BONDS
(Cost $3,965,183) 4,020,560
GOVERNMENT OBLIGATIONS - 66.2% (H)
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (D) AMOUNT (B) (NOTE 1)
ARGENTINA - 23.1%
Argentina Republic:
BOCON:
5.83%, 4/1/01 (i) B1 $ 2,506,289 $ 1,965,500
3.59%, 9/1/02 (i) - ARS 835,112 449,568
Brady euro:
floating rate bond 6.8125%, 3/31/05 (i) B2 5,250,000 3,740,625
par 5%, 3/31/23 (e) B2 8,425,000 4,807,516
10,963,209
BRAZIL - 18.5%
Brazil Federative Republic:
Brady:
capitalization bond 8%, 4/15/14 B1 5,199,930 2,973,710
debt conversion bond euro
6 7/8%, 4/15/12 (i) B1 4,450,000 2,536,500
eligible interest 6.81%, 4/15/06 (i) B1 3,900,000 2,686,125
par 4 1/4%, 4/15/24 (e) B1 1,150,000 610,219
8,806,554
BULGARIA - 3.6%
Republic of Bulgaria Brady discount
6 3/4%, 7/28/24 (i) - 3,200,000 1,700,000
ECUADOR - 1.9%
Republic of Ecuador Brady par euro
3%, 2/28/25 (e) - 2,550,000 918,000
MEXICO - 8.3%
Mexican Government Brady:
discount 6.54688%, 12/31/19 (i) Ba3 600,000 433,125
par:
6 1/4%,12/31/19 Ba2 775,000 504,719
6 1/4%, 12/31/19 Ba3 3,825,000 2,491,106
Mexico Value oil recovery rights (a) - 7,524,000 -
United Mexican States 0%,11/27/96 (return
indexed to higher of 28-day Cetes rate or
1 year LIBOR) (a)(f) - 500,000 509,375
3,938,325
PANAMA - 1.0%
Republic of Panama interest reduction bond (f)(g) - 1,050,000 475,125
GOVERNMENT OBLIGATIONS (H) - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (D) AMOUNT (B) (NOTE 1)
PHILIPPINES - 3.0%
Philippine Government Brady par
6 1/4%, 12/1/17 (e) Ba2 $ 1,900,000 $ 1,420,250
POLAND - 1.2%
Polish Government Treasury Bills:
0%, 9/04/96 - PLN 900,000 312,874
0%, 10/30/96 - PLN 720,000 242,122
554,996
SOUTH AFRICA - 0.9%
Republic of South Africa 12%, 2/28/05 Baa1 ZAR 1,700,000 414,486
VENEZUELA - 4.7%
Republic of Venezuela:
Brady debt conversion bond
7 3/8%, 12/18/07 (i) Ba2 2,400,000 1,367,063
Brady par A euro 6 3/4%, 3/31/20 Ba2 1,550,000 885,438
oil recovery rights (a) - 7,750 -
2,252,501
TOTAL GOVERNMENT OBLIGATIONS
(Cost $29,077,040) 31,443,446
PURCHASED BANK DEBT - 13.4%
MOROCCO - 3.5%
Kingdom of Morocco, Series A loan
participation 6.59375%, 1/1/09 (g)(i) 2,460,000 1,648,200
PANAMA - 3.9%
Republic of Panama loan participation refinanced
under credit agreement (a)(g) 2,500,000 1,850,000
PERU - 1.4%
Republic of Peru loan participation under
1983 agreement (a)(g)(i) 890,000 646,363
RUSSIA - 4.6%
Bank for Foreign Economic Affairs of the
USSR (Vnesheconombank) loan
participation (a)(g) 6,400,000 2,176,000
TOTAL PURCHASED BANK DEBT
(Cost $5,603,392) 6,320,563
COMMERCIAL PAPER - 0.9%
PRINCIPAL VALUE
AMOUNT (B) (NOTE 1)
INDONESIA - 0.9%
Tjiwi Kimia International Finance Co.
BV 0%, 1/24/96 (c) (Cost $443,494) IDR 1,000,000 $ 432,736
REPURCHASE AGREEMENTS - 11.0%
MATURITY
AMOUNT
Investments in repurchase agreements
(U.S. Treasury obligations) in a
joint trading account at 5.88%
dated 12/29/95 due 1/2/96 $ 5,239,421 5,236,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $44,325,109) $ 47,453,305
CURRENCY ABBREVIATIONS
ARS - Argentine peso
CZK - Czech koruna
IDR - Indonesian rupiah
ZAR - South African rand
PLN - Polish zloty
LEGEND
1. Non-income producing
2. Principal amount is stated in United States dollars unless otherwise
noted.
3. Principal amount in thousands.
4. Standard & Poor's credit ratings are used in the absence of a rating by
Moody's Investors Service, Inc.
5. Debt obligation initially issued at one coupon which converts to a
higher coupon at a specified date.
6. Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $1,830,525 or 4.0% of net
assets.
7. A portion of the security purchased on a delayed delivery basis (see
Note 2 of Notes to Financial Statements).
8. Some foreign government obligations have not been individually rated by
S&P or Moody's. The ratings listed are assigned to securities by FMR, the
fund's investment adviser, based principally on S&P and Moody's ratings of
the sovereign credit of the issuing government.
9. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 0.9% AAA, AA, A 2.1%
Baa 1.7% BBB 0.9%
Ba 15.9% BB 33.6%
B 41.4% B 20.9%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
For some foreign government obligations, FMR has assigned the ratings of
the sovereign credit of the issuing government. The percentage not rated by
either S&P or Moody's amounted to 24.8% including long-term debt
categorized as other securities. FMR has determined that unrated debt
securities that are lower quality account for 23.9% of the total value of
investment in securities.
INCOME TAX INFORMATION
At December 31, 1995, the aggregate cost of investment securities for
income tax purposes was $44,508,561. Net unrealized appreciation
aggregated $2,944,744, of which $2,978,328 related to appreciated
investment securities and $33,584 related to depreciated investment
securities.
At December 31, 1995, the fund had a capital loss carryforward of
approximately $6,212,000 which will expire on December 31, 2003.
The fund intends to elect to defer to its fiscal year ending December 31,
1996 approximately $7,300 of losses recognized during the period November
1, 1995 to December 31, 1995.
MARKET SECTOR DIVERSIFICATION
As a Percentage of Total Value of Investment in Securities (Unaudited)
Basic Industries 1.4%
Finance 2.1
Government Obligations 66.2
Media & Leisure 0.4
Nondurables 0.9
Purchased Bank Debt 13.4
Repurchase Agreements 11.0
Technology 0.8
Utilities 3.8
100.0%
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
DECEMBER 31, 1995

ASSETS

Investment in securities, at value (including repurchase $ 47,453,305
agreements of $5,236,000) (cost $44,325,109) -
See accompanying schedule

Cash 206,605

Receivable for investments sold 202,867

Interest receivable 751,404

Prepaid expenses 8,975

TOTAL ASSETS 48,623,156

LIABILITIES

Payable for investments purchased $ 312,140
Regular delivery

Delayed delivery 2,289,125

Distributions payable 23,288

Accrued management fee 8,550

Distribution fees payable 14,686

Other payables and accrued expenses 83,436

TOTAL LIABILITIES 2,731,225

NET ASSETS $ 45,891,931

Net Assets consist of:

Paid in capital $ 49,469,282

Distributions in excess of net investment income (276,131)

Accumulated undistributed net realized gain (loss) on (6,428,930)
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 3,127,710
investments and assets and liabilities in foreign
currencies

NET ASSETS $ 45,891,931

CALCULATION OF MAXIMUM OFFERING PRICE $9.28
CLASS A:
NET ASSET VALUE, and redemption price per share
($36,204,615 (divided by) 3,901,463 shares)

Maximum offering price per share (100/95.25 of $9.28) $9.74

CLASS B: $9.30
NET ASSET VALUE, offering price and redemption price
per share ($9,486,028 (divided by) 1,020,155 shares) A

INSTITUTIONAL CLASS $9.28
NET ASSET VALUE, offering price and redemption price
per share ($201,288 (divided by) 21,685 shares)

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED DECEMBER 31, 1995

INVESTMENT INCOME $ 4,369,318
Interest

EXPENSES

Management fee $ 283,122

Transfer agent fees 119,593
Class A

Class B 28,611

Institutional Class 122

Distribution fees - Class A 83,361

Distribution fees - Class B 69,712

Accounting fees and expenses 45,004

Non-interested trustees' compensation 166

Custodian fees and expenses 33,057

Registration fees - Class A 34,665

Registration fees - Class B 15,290

Registration fees - Institutional Class 15,271

Audit 46,947

Legal 2,583

Reports to shareholders 1,749

Miscellaneous 381

Total expenses before reductions 779,634

Expense reductions (120,937) 658,697

NET INVESTMENT INCOME 3,710,621

REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:

Investment securities (5,509,526)

Foreign currency transactions 57,249 (5,452,277)

Change in net unrealized appreciation (depreciation) on:

Investment securities 6,492,709

Assets and liabilities in foreign currencies (95,995) 6,396,714

NET GAIN (LOSS) 944,437

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 4,655,058
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1995 1994

INCREASE (DECREASE) IN NET ASSETS

Operations $ 3,710,621 $ 1,149,574
Net investment income

Net realized gain (loss) (5,452,277) 70,512

Change in net unrealized appreciation (depreciation) 6,396,714 (3,269,004)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 4,655,058 (2,048,918)
FROM OPERATIONS

Distributions to shareholders (3,105,070) (757,141)
From net investment income
Class A

Class B (590,979) (58,330)

Institutional Class (4,785) -

In excess of net investment income - (322,864)
Class A

Class B - (24,873)

From net realized gain - (44,276)
Class A

Class B - (4,694)

In excess of net realized gain - (1,148,710)
Class A

Class B - (121,779)

TOTAL DISTRIBUTIONS (3,700,834) (2,482,667)

Share transactions - net increase (decrease) 9,874,830 39,594,462

TOTAL INCREASE (DECREASE) IN NET ASSETS 10,829,054 35,062,877

NET ASSETS

Beginning of period 35,062,877 -

End of period (including distributions in excess of net $ 45,891,931 $ 35,062,877
investment income of $276,131 and $541,145,
respectively)

</TABLE>

FINANCIAL HIGHLIGHTS - CLASS A
YEARS ENDED DECEMBER 31,

1995 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 9.520 $ 10.000

Income from Investment Operations

Net investment income .860 .356

Net realized and unrealized gain (loss) (.323) F (.073)

Total from investment operations .537 .283

Less Distributions

From net investment income (.777) (.353)

In excess of net investment income - (.150)

From net realized gain - (.010)

In excess of net realized gain - (.250)

Total distributions (.777) (.763)

Net asset value, end of period $ 9.280 $ 9.520

TOTAL RETURN B, C 6.99% 2.47%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 36,205 $ 30,029

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

Ratio of net investment income to average net assets 9.32% 6.60% A

Portfolio turnover 305% 354% A

1995 1994 D

Selected Per-Share Data

Net asset value, beginning of period $ 9.520 $ 9.700

Income from Investment Operations

Net investment income .835 .167

Net realized and unrealized gain (loss) (.342) F .227

Total from investment operations .493 .394

Less Distributions

From net investment income (.713) (.220)

In excess of net investment income - (.094)

From net realized gain - (.010)

In excess of net realized gain - (.250)

Total distributions (.713) (.574)

Net asset value, end of period $ 9.300 $ 9.520

Total Return B, C 6.38% 3.67%

Ratios and Supplemental Data

Net assets, end of period (000 omitted) $ 9,486 $ 5,034

Ratio of expenses to average net assets 2.25% E 2.25% A
, E

Ratio of net investment income to average net assets 8.48% 5.86% A

Portfolio turnover 305% 354% A

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
D FOR THE PERIOD JUNE 30, 1994 (COMMENCEMENT OF SALE OF SHARES) TO DECEMBER
31, 1994.
E FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
F THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET GAIN (LOSS) OF INVESTMENTS FOR THE PERIOD ENDED DUE TO THE
TIMING OF SALES AND REPURCHASE OF FUND SHARES IN RELATION TO FLUCTUATING
MARKET VALUES OF THE INVESTMENTS OF THE FUND.
FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS
YEAR ENDED
DECEMBER 31,

1995 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 8.400

Income from Investment Operations

Net investment income .393

Net realized and unrealized gain (loss) .876 F

Total from investment operations 1.269

Less Distributions

From net investment income (.389)

Net asset value, end of period $ 9.280

Total Return B, C 15.52%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 201

Ratio of expenses to average net assets 1.25% A
, E

Ratio of net investment income to average net assets 9.09% A

Portfolio turnover 305%

A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
D FOR THE PERIOD JULY 3, 1995 (COMMENCEMENT OF SALE OF SHARES) TO DECEMBER
31, 1995.
E FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
F THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET GAIN (LOSS) OF INVESTMENTS FOR THE PERIOD ENDED DUE TO THE
TIMING OF SALES AND REPURCHASE OF FUND SHARES IN RELATION TO FLUCTUATING
MARKET VALUES OF THE INVESTMENTS OF THE FUND.
NOTES TO FINANCIAL STATEMENTS
For the period ended December 31, 1995

1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Advisor Emerging Markets Income Fund (the fund) is a fund of
Fidelity Advisor Series VIII (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 B, 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 its distribution plan. The fund
commenced sale of Institutional Class shares on July 3, 1995. Investment
income, realized and unrealized capital gains and losses, and the common
expenses of the fund 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, registration, and certain other class-specific fees and expenses.
The following summarizes the significant accounting policies of the fund:
SECURITY VALUATION. 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
maturing within sixty days of their purchase date are valued at amortized
cost or original cost plus accrued interest, both of which approximate
current value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Purchases and
sales of securities, income receipts, and expense payments are translated
into U.S. dollars at the prevailing exchange rate on the respective dates
of the transactions.
Net realized gains and losses on foreign currency transactions represent
net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, currency gains and losses
realized between the trade and settlement dates on securities transactions,
and the difference between the amount of net investment income accrued and
the U.S. dollar amount actually received. The effects of changes in foreign
currency exchange rates on investments in securities are included with the
net realized and unrealized gain or loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
INCOME TAXES - CONTINUED
is not subject to U.S. federal income taxes to the extent that it
distributes substantially all of its taxable income for its fiscal year.
The fund may be subject to foreign taxes on income, gains on investments or
currency repatriation. The fund accrues such taxes as applicable. The
schedule of investments includes information regarding income taxes under
the caption "Income Tax Information."
INVESTMENT INCOME. Interest income, which includes 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 the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
PREPAID EXPENSES. FMR bears all organizational expenses except for
registering and qualifying each class and shares of each class for
distribution under federal and state securities law. These expenses are
borne by each class and amortized over one year.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net investment income. Distributions from realized gains, if
any, are recorded on the ex-dividend date. Income dividends are declared
separately for each class, while capital gain distributions are declared at
the fund level and allocated to each class on a pro rata basis based on the
number of shares held by each class on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for foreign
currency transactions, market discount and losses deferred due to wash
sales.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net investment income and realized
and unrealized gain (loss). Distributions in excess of net investment
income and accumulated undistributed net realized gain (loss) on
investments and foreign currency transactions may include temporary book
and tax basis differences that will reverse in a subsequent period. Any
taxable income or gain remaining at fiscal year end is distributed in the
following year.
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.
FORWARD FOREIGN CURRENCY CONTRACTS. The fund may use foreign currency
contracts to facilitate transactions in foreign securities and to manage
the fund's currency exposure. Contracts
2. OPERATING POLICIES - CONTINUED
FORWARD FOREIGN CURRENCY CONTRACTS - CONTINUED
to buy generally are used to acquire exposure to foreign currencies, while
contracts to sell are used to hedge the fund's investments against currency
fluctuations. Also, a contract to buy or sell can offset a previous
contract. 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 forward foreign currency contracts is determined
using forward currency exchange rates supplied by a quotation service.
Purchases and sales of forward foreign currency contracts having the same
settlement date and broker are offset and any realized gain (loss) is
recognized on the date of offset; otherwise, gain (loss) is recognized on
settlement date.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of Fidelity Management & Research Company (FMR), may transfer
uninvested cash balances into one or more joint trading accounts. These
balances are invested in one or more repurchase agreements that mature in
60 days or less from the date of purchase, and are collateralized by U.S.
Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying U.S. Treasury or Federal Agency securities, the market
value of which is required to be at least equal to the repurchase price.
For term repurchase agreement transactions, the underlying securities are
marked-to-market daily and maintained at a value at least equal to the
repurchase price. 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.
DELAYED DELIVERY TRANSACTIONS. The fund may purchase or sell securities on
a when-issued or forward commitment basis. Payment and delivery may take
place a month or more after the date of the transaction. The price of the
underlying securities and the date when the securities will be delivered
and paid for are fixed at the time the transaction is negotiated. The
market value of the securities purchased or sold on a when-issued or
forward commitment basis are identified as such in the fund's schedule of
investments. The fund may receive compensation for interest forgone in the
purchase of a delayed delivery security. Losses may arise due to changes in
the market value of the underlying securities or if the counterparty does
not perform under the contract.
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $109,477,916 and $100,284,475, 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 .1200% to .3700% for the period. In the event that these
rates were lower than the contractual rates in effect during the period,
FMR voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. The annual individual fund fee rate is .55%. For
the period, the management fee was equivalent to an annual rate of .70% of
average net assets.
The Board of Trustees has approved a new group fee rate schedule with rates
ranging from .1100% to .3700%. Effective January 1, 1996, FMR voluntarily
agreed to implement this new group fee rate schedule as it results in the
same or a lower management fee.
SUB-ADVISER FEE. FMR, on behalf of the fund, entered into sub-advisory
agreements with Fidelity Management & Research (U.K.) Inc., Fidelity
Management & Research Far East Inc., and Fidelity International Investment
Advisors (FIIA), and Fidelity Investment Japan Ltd. In addition, FIIA
entered into a sub-advisory agreement with its subsidiary, Fidelity
International Investment Advisors (U.K.) Limited (FIIAL U.K.). Under the
sub-advisory arrangements, FMR may receive investment advice and research
services and may grant the sub-advisers investment management authority to
buy and sell securities. FMR pays its sub-advisers either a portion of its
management fee or a fee based on costs incurred for these services. FIIA
pays FIIAL U.K. a fee based on costs incurred for either service.
DISTRIBUTION AND SERVICE PLAN. In accordance with Rule 12b-1 of the 1940
Act, the Trustees have adopted separate distribution plans with respect to
the fund's Class A shares (Class A Plan), Class B shares (Class B Plan),
and Institutional Class shares (collectively referred to as "the Plans").
Under the Class A Plan and Class B Plan, the fund pays Fidelity
Distributors Corporation (FDC), an affiliate of FMR, a distribution and
service fee. This fee is based on annual rates of .25% and 1.00% (of which
.75% represents a distribution fee and .25% represents a shareholder
service fee) of the average net assets of the Class A and Class B shares,
respectively. Effective January 1, 1996, the Board of Trustees approved a
revised Class B distribution plan. Under the revised plan, the fee is based
on an annual rate of .90% (of which .65% represents a distribution fee and
.25% represents a shareholder service fee) of the average net assets of the
Class B shares. For the period, the fund paid FDC $83,361 and $69,712 under
the Class A Plan and Class B Plan, respectively, of which $71,061 and
$17,429 were paid to securities dealers, banks and
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
DISTRIBUTION AND SERVICE PLAN - CONTINUED
other financial institutions for the distribution of Class A and Class B
shares, respectively, and providing shareholder support services.
Under the Plans, FMR or FDC may use its resources to pay administrative and
promotional expenses related to the sale of the fund's Class A, Class B,
and Institutional Class shares. Subject to the approval of the Board of
Trustees, the Plans also authorize payments to third parties that assist in
the sale of the fund's shares or render shareholder support services. FMR
or FDC has informed the fund that payments made to third parties under the
Plans amounted to $7,752, $44 and $0 for Class A, Class B, and
Institutional Class, respectively.
SALES LOAD. FDC receives a front-end sales charge of up to 4.75% for
selling Class A shares of the fund. Effective January 1, 1996, the Board of
Trustees approved a revised Class A sales charge. Under the revised
arrangement, FDC receives a front-end sales charge of up to 3.50% for
selling Class A shares of the fund. For the period, FDC received sales
charges of $465,187 on sales of Class A shares of the fund, of which
$219,816 was paid to securities dealers, banks, and other financial
institutions. FDC also receives the proceeds of a contingent deferred sales
charge levied on Class B share redemptions occurring within five years of
purchase. The charge is based on declining rates which range from 4% to 1%
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. For the period, FDC received contingent deferred sales
charges of $12,203 on Class B share redemptions from the fund. When Class B
shares are sold, FDC pays commissions from its own resources to dealers
through which the sales are made.
TRANSFER AGENT FEES. State Street Bank and Trust Company (State Street) is
the transfer, dividend disbursing, and shareholder servicing agent for the
fund's Class A shares, while Fidelity Investments Institutional Operations
Company (FIIOC), an affiliate of FMR (collectively, with State Street,
referred to as the Transfer Agents) acts in that capacity for the fund's
Class B and Institutional Class shares. The Transfer Agents receive account
fees and asset-based fees that vary according to the account size and type
of account of the shareholders of the respective classes of the fund. With
respect to the Class A shares, State Street has delegated certain transfer,
dividend paying, and shareholder services to FIIOC for which FIIOC receives
its allocable share of all such fees. FIIOC pays for typesetting, printing
and mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annual rate of .36%,
.41%, and .23% (annualized) of average net assets for Class A, Class B, and
Institutional Class, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
ACCOUNTING FEES. FSC maintains the fund's accounting records. The fee is
based on the level of average net assets for the month plus out-of-pocket
expenses.
5. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse operating expenses (excluding interest,
taxes, brokerage commissions and extraordinary expenses) above the
following annual rates of average net assets for Class A, Class B, and
Institutional Class.
CLASS A. For the period, this expense limitation was 1.50% of average net
assets and the reimbursement reduced expenses by $78,724.
CLASS B. For the period, this expense limitation was 2.25% of average net
assets and the reimbursement reduced expenses by $26,982.
INSTITUTIONAL CLASS. For the period, this expense limitation was 1.25% of
average net assets and the reimbursement reduced expenses by $15,231.
6. CONCENTRATION OF RISK.
The fund's relatively large investment in countries with limited or
developing capital markets may involve greater risks than investments in
more developed markets and the prices of such investments may be volatile.
The yields of emerging market debt obligations reflect, among other things,
perceived credit risk. The consequences of political, social or economic
changes in these markets may have disruptive effects on the market prices
of the fund's investments and the income they generate, as well as the
fund's ability to repatriate such amounts.
7. BENEFICIAL INTEREST.
At the end of the period, one shareholder was record owner of approximately
11.95% of the total outstanding shares of the fund.
8. SHARE TRANSACTIONS.
Share transactions for each class of shares were as follows:
SHARES DOLLARS
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED DECEMBER 31, DECEMBER 31,
DECEMBER 31, DECEMBER 31,
1995 C 1994 A, B 1995 C 1994 A, B
CLASS A
Shares sold 4,482,343 5,699,727 $ 36,686,496 $ 60,093,354
Reinvestment of distributions 330,013 203,573 2,753,394 2,117,041
Shares redeemed (4,066,720) (2,747,473) (33,780,229) (28,236,220)
Net increase (decrease) 745,636 3,155,827 $ 5,659,661 $ 33,974,175
CLASS B
Shares sold 632,120 545,353 $ 5,203,888 $ 5,812,924
Reinvestment of distributions 61,187 18,090 513,286 187,018
Shares redeemed (201,754) (34,841) (1,691,703) (379,655)
Net increase (decrease) 491,553 528,602 $ 4,025,471 $ 5,620,287
INSTITUTIONAL CLASS
Shares sold 21,145 - $ 185,008 $ -
Reinvestment of distributions 540 - 4,690 -
Shares redeemed - - - -
Net increase (decrease) 21,685 - $ 189,698 $ -

A SHARE TRANSACTIONS FOR CLASS A ARE FOR THE PERIOD MARCH 10, 1994
(COMMENCEMENT OF SALE OF SHARES) TO DECEMBER 31, 1994.
B SHARE TRANSACTIONS FOR CLASS B ARE FOR THE PERIOD JUNE 30, 1994
(COMMENCEMENT OF SALE OF SHARES) TO DECEMBER 31, 1994.
C SHARE TRANSACTIONS FOR INSTITUTIONAL CLASS ARE FOR THE PERIOD JULY 3,
1995 (COMMENCEMENT OF SALE OF SHARES) TO DECEMBER 31, 1995.
REPORT OF INDEPENDENT ACCOUNTANTS

To the Trustees of Fidelity Advisor Series VIII and the Shareholders of
Fidelity Advisor Emerging Markets Income Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Advisor Series VIII: Fidelity Advisor Emerging Markets Income
Fund, including the schedule of portfolio investments, as of December 31,
1995, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period
then ended, and the financial highlights for the year then ended and for
the period March 10, 1994 (commencement of operations) to December 31, 1994
(Class A), the period June 30, 1994 (commencement of sale of Class B
shares) to December 31, 1994, and the period July 3, 1995 (commencement of
sale of Institutional Class shares) to December 31, 1995. These financial
statements and financial highlights are the responsibility of the fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of December 31, 1995 by correspondence with the
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Advisor Series VIII: Fidelity Advisor Emerging Markets Income
Fund as of December 31, 1995, the results of its operations for the year
then ended, the changes in its net assets for each of the two years in the
period then ended and the financial highlights for the year then ended and
for the period March 10, 1994 (commencement of operations) to December 31,
1994 (Class A), the period June 30, 1994 (commencement of sale of Class B
shares) to December 31, 1994, and the period July 3, 1995 (commencement of
sale of Institutional Class shares) to December 31, 1995, in conformity
with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
February 6, 1996

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research
(U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
Fidelity Investments Japan Ltd.
Fidelity International Investment Advisors
Fidelity International Investment Advisors (U.K.) Limited
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Robert A. Lawrence, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
State Street Bank and Trust Company
Boston, MA - Class A
Fidelity Investments Institutional
Operations Company
Boston, MA - Class B
* INDEPENDENT TRUSTEES
CUSTODIAN
Chase Manhattan Bank, N.A.
New York, NY
GROWTH FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Growth
Opportunities Fund
Fidelity Advisor Strategic
Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Income Fund
Fidelity Advisor Income & Growth Fund
TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund
MUNICIPAL FUNDS
Fidelity Advisor High Income
Municipal Fund
Fidelity Advisor Intermediate Municipal Income Fund
Fidelity Advisor Short-Intermediate Municipal Income Fund
STATE MUNICIPAL FUNDS
Fidelity Advisor New York Municipal Income Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)
(registered trademark)

(2_FIDELITY_LOGOS)FIDELITY ADVISOR
(registered trademark)

EMERGING MARKETS INCOME
FUND - INSTITUTIONAL CLASS
ANNUAL REPORT
DECEMBER 31, 1995
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.

PERFORMANCE 4 How the fund has done over time.

FUND TALK 7 The manager's review of fund
performance, strategy and outlook.

INVESTMENT CHANGES 10 A summary of major shifts in the
fund's investments over the past six
months.

INVESTMENTS 11 A complete list of the fund's
investments with their market
values.

FINANCIAL STATEMENTS 16 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 22 Notes to the financial statements.

REPORT OF INDEPENDENT 29 The auditors' opinion.
ACCOUNTANTS

DEAR SHAREHOLDER:
Although the markets were fairly positive in 1995, no one can predict what
lies ahead for investors. The previous year, stocks posted below-average
returns and bonds had one of the worst years in history. This downturn
followed a period in which the investing environment was generally very
positive.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
Keeping in mind that the effects of interest rate changes on your bond
investments will only be "paper" gains or losses unless you sell your
shares, staying in your bond fund may be appropriate if your investment
horizon is at least a year or more. The longer your investing time frame,
the more likely it is that you will retain your principal investment
through both up and down markets. For example, a 10-year time frame, such
as saving
for a college education, enables you to weather these ups and downs in a
long-term fund, which has higher potential returns. An intermediate-length
fund could be appropriate if your investment horizon is two to four years,
and a short-term bond fund could be the right choice if you need your money
in one or two years.
If your time horizon is less than a year, you might want to consider moving
some of your bond investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
No matter what your investment horizon or portfolio diversity, it makes
good sense to follow a regular investment plan - investing a certain amount
of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
Remember to contact your investment professional if you need help with your
investments.
Best regards,
Edward C. Johnson 3d
ADVISOR EMERGING MARKETS INCOME FUND - INSTITUTIONAL CLASS
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate historical performance. You can look at
the total percentage change in value, the average annual percentage change,
or the growth of a hypothetical $10,000 investment. A fund's total return
includes changes in share price, plus reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells
securities that have grown in value). You can also look at income to
measure performance. Initial offering of Institutional Class shares took
place on July 3, 1995. Institutional Class shares are sold to eligible
investors without a sales load or 12b-1 fee. Returns prior to July 3, 1995
are those of Class A, the original class of the fund, and reflect Class A's
0.25% 12b-1 fee. If Fidelity had not reimbursed certain class expenses
during the periods shown, the total returns and dividends would have been
lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Emerging Markets Income - Institutional Class 7.11% 9.76%

JP Morgan Emerging Markets Bond Index 27.54% 14.37%

JP Morgan Emerging Markets Bond Index Plus 26.78% 13.59%

Average Emerging Market Debt Fund 20.12% n/a

CUMULATIVE TOTAL RETURNS show Institutional Class' performance in
percentage terms over a set period - in this case, one year, or since the
fund started on March 10, 1994. 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
those of the JP Morgan Emerging Markets Bond Index or the JP Morgan
Emerging Markets Bond Index Plus - both broad measures of bond performance
in developing countries. To measure how Institutional Class' performance
stacked up against its peers, you can compare it to the average emerging
market debt fund, which reflects the performance of 12 funds with similar
objectives tracked by Lipper Analytical Services over the past 12 months.
These benchmarks include reinvested dividends and capital gains, if any,
and exclude the effects of sales charges. Recent U.S. Consumer Price Index
(CPI) information is not available from the U.S. Department of Labor.
Therefore, the CPI comparison has not been included in this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Emerging Markets Income - Institutional Class 7.11% 5.27%

JP Morgan Emerging Markets Bond Index 27.54% 7.68%

JP Morgan Emerging Markets Bond Index Plus 26.78% 7.28%

Average Emerging Market Debt Fund 20.12% n/a

AVERAGE ANNUAL TOTAL RETURNS take Institutional Class' actual (or
cumulative) return and show you what would have happened if Institutional
Class shares had performed at a constant rate each year.
$10,000 OVER LIFE OF FUND
FA Emerg Mkt Inc Cljp004
03/31/94 10000.00 10,000.00
04/30/94 10131.58 9,813.15
05/31/94 10784.67 10,538.52
06/30/94 10262.68 10,003.24
07/31/94 10492.94 10,185.84
08/31/94 11757.16 11,028.96
09/30/94 12092.86 11,369.80
10/31/94 11781.18 11,010.46
11/30/94 11536.34 10,998.76
12/31/94 10692.22 10,286.30
01/31/95 9464.67 9,790.86
02/28/95 8788.23 9,335.47
03/31/95 8531.22 9,147.30
04/30/95 9263.64 10,126.09
05/31/95 9816.29 11,007.34
06/30/95 9871.60 11,250.30
07/31/95 9890.18 11,205.93
08/31/95 10104.06 11,512.64
09/30/95 10508.15 11,962.72
10/31/95 10444.04 11,832.85
11/30/95 10794.17 12,176.52
12/31/95 11452.95 13,039.94

$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Fidelity
Advisor Emerging Markets Income Fund - Institutional Class on March 31,
1994, shortly after the fund started. As the chart shows, by December 31,
1995, the value of your investment would have grown to $11,453 - a 14.53%
increase on your initial investment. For comparison, look at how the JP
Morgan Emerging Markets Bond Index Plus did over the same period. With
dividends reinvested, the same $10,000 investment would have grown to
$13,040 - a 30.40% increase.
Beginning with this report, the fund will compare its performance to the JP
Morgan Emerging Markets Bond Index Plus rather than the JP Morgan Emerging
Markets Bond Index. The JP Morgan Emerging Markets Bond Index Plus includes
corporate bonds and local currency bonds, and is more representative of the
fund's investable universe. For comparison purposes, both indices are shown
on page 4.
UNDERSTANDING
PERFORMANCE
Many markets around the globe
offer the potential for significant
growth over time; however,
investing in foreign markets
means assuming greater risks
than investing in the United
States. Factors like changes in a
country's financial markets, its
local political and economic
climate, and the fluctuating value
of its currency create these risks.
For these reasons an
international fund's performance
may be more volatile than a fund
that invests exclusively in the
United States. Past performance
is no guarantee of future results
and you may have a gain or loss
when you sell your shares.
(checkmark)

TOTAL RETURN COMPONENTS
YEAR ENDED MARCH 10, 1994
DECEMBER 31, (COMMENCEMENT
1995 OF FUND
OPERATIONS) TO
DECEMBER 31, 1994

Dividend return 9.63% 4.80%

Capital appreciation return -2.52% -2.33%

Total return 7.11% 2.47%

Dividends per share 6.77(cents) 38.87(cents)

Annualized dividend rate 8.86% 9.10%

30-day annualized yield n/a -

DIVIDENDS per share show the income paid by the class for a set period. If
you annualize this number, based on an average net asset value of $8.99
over the past month, and $8.61 over the life of class, you can compare the
class' income distributions over these two periods. The 30-day annualized
YIELD is a standard formula for all bond funds based on the yields of the
bonds in the fund, averaged over the past 30 days. This figure shows you
the yield characteristics of the fund's investments at the end of the
period. It also helps you to compare funds from different companies on an
equal basis. Yield information will be reported once the Institutional
Class has a longer operating history.
FUND TALK: THE MANAGER'S OVERVIEW

MARKET RECAP
Both developed and emerging
fixed-income markets recorded
strong returns in 1995. For the
12 months ended December 31,
1995, the Salomon Brothers World
Government Bond Index - a
proxy of government bond market
performance in developed nations
including the U.S. - rose
19.04%. Emerging markets
shrugged off the fallout from
December 1994's Mexican peso
devaluation to record strong
returns. The J.P. Morgan Emerging
Markets Bond Index posted a
27.54% return for the year. To
compare, the Lehman Brothers
Aggregate Bond Index - a broad
measure of taxable bonds in the
U.S. market - had a total return of
18.47%. Bond markets in
developed countries benefited
from slow economic growth and
relatively low inflation pressures.
This led to a more favorable interest
rate environment, as the central
banks of the U.S., Germany and
Great Britain all lowered their
respective short-term interest
rates. Record low interest rates
in Japan and a strengthening
dollar pushed a significant amount
of money into the U.S., as overseas
investors in 1995 purchased a
record net $99.4 billion in U.S.
Treasury securities - helping fuel
the U.S. rally. The bulk of emerging
markets' total return came from a
springtime rally following the
announcement of a $50 billion
bailout package for Mexico by the
U.S. Treasury and the International
Monetary Fund.
An interview with John Carlson, Portfolio Manager of Fidelity Advisor
Emerging Markets Income Fund
Q. HOW DID THE FUND PERFORM, JOHN?
A. For the 12-months ended December 31, 1995, the fund's Institutional
Class shares returned 7.11%. For comparison purposes, the J.P. Morgan
Emerging Markets Bond Index Plus returned 26.78% and the average emerging
market debt fund, according to Lipper Analytical Services, returned 20.12%.
In stark contrast to the first six months of 1995, however, in the past six
months the fund posted a 16.02% gain for its Institutional shares. At the
same time, the index returned 15.91% and average emerging market debt fund
returned 15.82%.
Q. WOULD YOU DESCRIBE WHAT THE EMERGING DEBT MARKET WAS LIKE THIS PAST
YEAR?
A. Sure. As described in the fund's semiannual report in June, we came into
1995 with the Mexican peso devaluation having cast a pall over most
emerging markets. The emerging debt markets rebounded, however, with a
springtime rally following the announcement of a support package from the
international community for Argentina and Mexico. In general, all
fixed-income markets benefited from slow economic growth, stable interest
rates and relatively low inflation pressures. This became particularly
evident when the central banks of the U.S., Germany and Great Britain all
lowered their respective short-term interest rates. Although returns in
emerging debt markets remained positive, there was a market consolidation
from May to the middle of November. Finally, from November to the end of
year, emerging market bonds rallied, spurred by international investors
seeking higher yields.
Q. SO HOW WAS THE FUND MANAGED IN THIS DYNAMIC ENVIRONMENT?
A. When I began managing the fund in June, it had a significant cash
position. I put that cash to work in Latin American corporate bonds. As
investors recognized the value of these bonds, they appreciated in value
and their spreads - the difference in yield compared to U.S. Treasury bonds
- - tightened. I then sold these corporates and bought Brady bonds of Brazil.
Country rotation from Brazil to Argentina to Mexico became the theme for
the rest of the year.
Q. SHOULD ONE ASSUME THAT BECAUSE YOU TOOK PROFITS MAINLY IN THE SOUTH
AMERICAN POSITIONS, THAT YOU ARE NO LONGER OPTIMISTIC ABOUT THIS AREA OF
THE WORLD?
A. Absolutely not. I always look at individual securities on a relative
value basis. That said, the fund's largest positions are still in Argentina
and Brazil. These countries have embarked on ambitious privatization
programs of state industries as well as fiscal reforms.
Q. WHAT WERE SOME OTHER APPEALING AREAS OF THE MARKET FOR THE FUND?
A. Although the fund had a very small position in Southeast Asia, loans
from Vietnam and bonds from Indonesia performed well during the period.
Additionally, the fund participated in this year's rally in South African
bonds. Aside from the bonds the fund is allowed to own, it also has a
significant interest in loan participations. Loans generally performed
well, with those from Panama, Peru and Russia particularly benefiting the
fund.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. There were very few. The largest was the fact that the fund held a large
cash position during the emerging debt market rally this past spring. Thus,
the fund did not fully participate in the rebound.
Q. WHAT'S YOUR OUTLOOK?
A. I am optimistic about emerging market debt. Stable interest rates in the
developed world coupled with tight fiscal and monetary policies in emerging
countries may attract more capital. However, I will continue to monitor the
economies, politics and interest rates that can radically effect the
emerging markets.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.

TOP COUNTRIES AS OF DECEMBER 31, 1995
(EXCLUDING REPURCHASE AGREEMENTS) % OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS 6 MONTHS AGO

Argentina 25.3 16.8

Brazil 18.9 23.1

Mexico 8.3 6.0

Panama 4.9 1.7

Venezuela 4.7 0.0

Argentina Republic 23.1 16.8

Brazil Federative Republic 18.5 21.7

Mexican Government Brady 7.2 4.6

Republic of Venezuela 4.7 0.0

Bank for Foreign Economic
Affairs of the 4.6 2.8
USSR (Vnesheconombank)

AVERAGE YEARS TO MATURITY AS OF DECEMBER 31, 1995
6 MONTHS AGO

Years 13.5 12.2

Showing Percentage of Total Value of Investment in Securities

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
DECEMBER 31, 1995

ASSETS

Investment in securities, at value (including repurchase $ 47,453,305
agreements of $5,236,000) (cost $44,325,109) -
See accompanying schedule

Cash 206,605

Receivable for investments sold 202,867

Interest receivable 751,404

Prepaid expenses 8,975

TOTAL ASSETS 48,623,156

LIABILITIES

Payable for investments purchased $ 312,140
Regular delivery

Delayed delivery 2,289,125

Distributions payable 23,288

Accrued management fee 8,550

Distribution fees payable 14,686

Other payables and accrued expenses 83,436

TOTAL LIABILITIES 2,731,225

NET ASSETS $ 45,891,931

Net Assets consist of:

Paid in capital $ 49,469,282

Distributions in excess of net investment income (276,131)

Accumulated undistributed net realized gain (loss) on (6,428,930)
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 3,127,710
investments and assets and liabilities in foreign
currencies

NET ASSETS $ 45,891,931

CALCULATION OF MAXIMUM OFFERING PRICE $9.28
CLASS A:
NET ASSET VALUE, and redemption price per share
($36,204,615 (divided by) 3,901,463 shares)

Maximum offering price per share (100/95.25 of $9.28) $9.74

CLASS B: $9.30
NET ASSET VALUE, offering price and redemption price
per share ($9,486,028 (divided by) 1,020,155 shares) A

INSTITUTIONAL CLASS $9.28
NET ASSET VALUE, offering price and redemption price
per share ($201,288 (divided by) 21,685 shares)

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED DECEMBER 31, 1995

INVESTMENT INCOME $ 4,369,318
Interest

EXPENSES

Management fee $ 283,122

Transfer agent fees 119,593
Class A

Class B 28,611

Institutional Class 122

Distribution fees - Class A 83,361

Distribution fees - Class B 69,712

Accounting fees and expenses 45,004

Non-interested trustees' compensation 166

Custodian fees and expenses 33,057

Registration fees - Class A 34,665

Registration fees - Class B 15,290

Registration fees - Institutional Class 15,271

Audit 46,947

Legal 2,583

Reports to shareholders 1,749

Miscellaneous 381

Total expenses before reductions 779,634

Expense reductions (120,937) 658,697

NET INVESTMENT INCOME 3,710,621

REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:

Investment securities (5,509,526)

Foreign currency transactions 57,249 (5,452,277)

Change in net unrealized appreciation (depreciation) on:

Investment securities 6,492,709

Assets and liabilities in foreign currencies (95,995) 6,396,714

NET GAIN (LOSS) 944,437

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 4,655,058
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1995 1994

INCREASE (DECREASE) IN NET ASSETS

Operations $ 3,710,621 $ 1,149,574
Net investment income

Net realized gain (loss) (5,452,277) 70,512

Change in net unrealized appreciation (depreciation) 6,396,714 (3,269,004)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 4,655,058 (2,048,918)
FROM OPERATIONS

Distributions to shareholders (3,105,070) (757,141)
From net investment income
Class A

Class B (590,979) (58,330)

Institutional Class (4,785) -

In excess of net investment income - (322,864)
Class A

Class B - (24,873)

From net realized gain - (44,276)
Class A

Class B - (4,694)

In excess of net realized gain - (1,148,710)
Class A

Class B - (121,779)

TOTAL DISTRIBUTIONS (3,700,834) (2,482,667)

Share transactions - net increase (decrease) 9,874,830 39,594,462

TOTAL INCREASE (DECREASE) IN NET ASSETS 10,829,054 35,062,877

NET ASSETS

Beginning of period 35,062,877 -

End of period (including distributions in excess of net $ 45,891,931 $ 35,062,877
investment income of $276,131 and $541,145,
respectively)

</TABLE>

FINANCIAL HIGHLIGHTS - CLASS A
YEARS ENDED DECEMBER 31,

1995 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 9.520 $ 10.000

Income from Investment Operations

Net investment income .860 .356

Net realized and unrealized gain (loss) (.323) F (.073)

Total from investment operations .537 .283

Less Distributions

From net investment income (.777) (.353)

In excess of net investment income - (.150)

From net realized gain - (.010)

In excess of net realized gain - (.250)

Total distributions (.777) (.763)

Net asset value, end of period $ 9.280 $ 9.520

TOTAL RETURN B, C 6.99% 2.47%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 36,205 $ 30,029

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

Ratio of net investment income to average net assets 9.32% 6.60% A

Portfolio turnover 305% 354% A

1995 1994 D

Selected Per-Share Data

Net asset value, beginning of period $ 9.520 $ 9.700

Income from Investment Operations

Net investment income .835 .167

Net realized and unrealized gain (loss) (.342) F .227

Total from investment operations .493 .394

Less Distributions

From net investment income (.713) (.220)

In excess of net investment income - (.094)

From net realized gain - (.010)

In excess of net realized gain - (.250)

Total distributions (.713) (.574)

Net asset value, end of period $ 9.300 $ 9.520

Total Return B, C 6.38% 3.67%

Ratios and Supplemental Data

Net assets, end of period (000 omitted) $ 9,486 $ 5,034

Ratio of expenses to average net assets 2.25% E 2.25% A
, E

Ratio of net investment income to average net assets 8.48% 5.86% A

Portfolio turnover 305% 354% A

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
D FOR THE PERIOD JUNE 30, 1994 (COMMENCEMENT OF SALE OF SHARES) TO DECEMBER
31, 1994.
E FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
F THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET GAIN (LOSS) OF INVESTMENTS FOR THE PERIOD ENDED DUE TO THE
TIMING OF SALES AND REPURCHASE OF FUND SHARES IN RELATION TO FLUCTUATING
MARKET VALUES OF THE INVESTMENTS OF THE FUND.
FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS
YEAR ENDED
DECEMBER 31,

1995 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 8.400

Income from Investment Operations

Net investment income .393

Net realized and unrealized gain (loss) .876 F

Total from investment operations 1.269

Less Distributions

From net investment income (.389)

Net asset value, end of period $ 9.280

Total Return B, C 15.52%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 201

Ratio of expenses to average net assets 1.25% A
, E

Ratio of net investment income to average net assets 9.09% A

Portfolio turnover 305%

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research
(U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
Fidelity Investments Japan Ltd.
Fidelity International Investment Advisors
Fidelity International Investment Advisors (U.K.) Limited
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Robert A. Lawrence, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
Fidelity Investments Institutional
Operations Company
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
Chase Manhattan Bank, N.A.
New York, NY
GROWTH FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Growth
Opportunities Fund
Fidelity Advisor Strategic
Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Income Fund
Fidelity Advisor Income & Growth Fund
TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund
MUNICIPAL FUNDS
Fidelity Advisor High Income
Municipal Fund
Fidelity Advisor Intermediate Municipal Income Fund
Fidelity Advisor Short-Intermediate Municipal Income Fund
STATE MUNICIPAL FUNDS
Fidelity Advisor New York Municipal Income Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)
(registered trademark)

(2_FIDELITY_LOGOS)FIDELITY ADVISOR
(registered trademark)

STRATEGIC INCOME
FUND - INSTITUTIONAL CLASS
ANNUAL REPORT
DECEMBER 31, 1995
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.

PERFORMANCE 4 How the fund has done over time.

FUND TALK 7 The manager's review of fund
performance, strategy and outlook.

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

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

FINANCIAL STATEMENTS 27 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 33 Notes to the financial statements.

REPORT OF INDEPENDENT 39 The auditors' opinion.
ACCOUNTANTS

DISTRIBUTIONS 40

DEAR SHAREHOLDER:
Although the markets were fairly positive in 1995, no one can predict what
lies ahead for investors. The previous year, stocks posted below-average
returns and bonds had one of the worst years in history. This downturn
followed a period in which the investing environment was generally very
positive.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
Keeping in mind that the effects of interest rate changes on your bond
investments will only be "paper" gains or losses unless you sell your
shares, staying in your bond fund may be appropriate if your investment
horizon is at least a year or more. The longer your investing time frame,
the more likely it is that you will retain your principal investment
through both up and down markets. For example, a 10-year time frame, such
as saving
for a college education, enables you to weather these ups and downs in a
long-term fund, which has higher potential returns. An intermediate-length
fund could be appropriate if your investment horizon is two to four years,
and a short-term bond fund could be the right choice if you need your money
in one or two years.
If your time horizon is less than a year, you might want to consider moving
some of your bond investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
No matter what your investment horizon or portfolio diversity, it makes
good sense to follow a regular investment plan - investing a certain amount
of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
Remember to contact your investment professional if you need help with your
investments.
Best regards,
Edward C. Johnson 3d
ADVISOR STRATEGIC INCOME FUND - INSTITUTIONAL CLASS
PERFORMANCE: THE BOTTOM LINE(dagger)

There are several ways to evaluate historical performance. You can look at
the total percentage change in value, the average annual percentage change,
or the growth of a hypothetical $10,000 investment. A fund's total return
includes changes in share price, plus reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells
securities that have grown in value). You can also look at income to
measure performance. Initial offering of Institutional Class shares took
place on July 3, 1995. Institutional Class shares are sold to eligible
investors without a sales load or 12b-1 fee. Returns prior to July 3, 1995
are those of Class A, the original class of the fund, and reflect Class A's
0.25% 12b-1 fee. If Fidelity had not reimbursed certain class expenses
during the periods shown, the total returns and dividends would have been
lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Strategic Income - Institutional Class 22.41% 22.62%

Merrill Lynch High Yield Master Index 19.91% 20.36%

Fidelity Strategic Income Composite 19.82% n/a
Benchmark

Average General Bond Fund 18.02% 16.57%

CUMULATIVE TOTAL RETURNS show Institutional Class' performance in
percentage terms over a set period - in this case, one year or since the
fund started on October 31, 1994. 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
those of the Merrill Lynch High Yield Master Index - a broad measure of the
high yield bond market, or the Fidelity Strategic Income Composite
Benchmark - a broad measure of the world fixed income markets. To measure
how Institutional Class' performance stacked up against its peers, you can
compare it to the average general bond fund, which reflects the performance
of 64 funds with similar objectives tracked by Lipper Analytical Services
over the past 12 months. These benchmarks include reinvested dividends and
capital gains, if any, and exclude the effects of sales charges. Recent
U.S. Consumer Price Index (CPI) information is not available from the U.S.
Department of Labor. Therefore, the CPI comparison has not been included in
this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Strategic Income - Institutional Class 22.41% 19.04%

Merrill Lynch High Yield Master Index 19.91% 17.16%

Fidelity Strategic Income Composite 19.82% n/a
Benchmark

Average General Bond Fund 18.02% 14.04%

AVERAGE ANNUAL TOTAL RETURNS take Institutional Class' actual (or
cumulative) return and show you what would have happened if Institutional
Class shares had performed at a constant rate each year.
$10,000 OVER LIFE OF FUND
FA Strat Inc Cl I (648) High Yield Master Fid Strat Inc Comp
10/31/94 10000.00 10000.00 10000.00
11/30/94 10050.16 9914.94 9921.26
12/31/94 10017.44 10025.22 9887.56
01/31/95 10129.20 10166.88 9962.57
02/28/95 10368.45 10484.10 10125.61
03/31/95 10518.89 10630.00 10301.07
04/30/95 10913.50 10878.89 10634.09
05/31/95 11324.23 11218.77 11037.19
06/30/95 11382.14 11304.46 11135.32
07/31/95 11496.09 11433.70 11192.91
08/31/95 11515.97 11503.09 11198.60
09/30/95 11722.27 11634.70 11390.44
10/31/95 11858.92 11717.17 11444.44
11/30/95 11991.80 11831.55 11595.55
12/31/95 12262.15 12021.46 11847.24

$10,000 OVER LIFE OF FUND(dagger): Let's say you invested $10,000 in
Fidelity Advisor Strategic Income Fund - Institutional Class on October 31,
1994, when the fund started. As the chart shows, by December 31, 1995, the
value of your investment would have grown to $12,262 - an 22.62% increase
on your initial investment. For comparison, look at how the Merrill Lynch
High Yield Master Index did over the same period. With dividends
reinvested, the same $10,000 investment would have grown to $12,021 - a
20.21% increase. You also can look at how the Fidelity Strategic Income
Composite Benchmark, a hypothetical combination of unmanaged indices that
is more representative of the fund's investable universe, did over the same
period. This index combines returns from the JP Morgan Emerging Markets
Bond Index Plus (15%), Merrill Lynch High Yield Master Index (40%), Salomon
Brothers Mortgage Index (15%), Salomon Brothers Treasury 1-10 Year Index
(15%), and Salomon Brothers Non-U.S. Dollar World Government Bond Index
(15%). With distributions, if any, reinvested, a $10,000 investment in the
index would have grown to $11,847 - an 18.47% increase.

UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, generally move in
the opposite direction of
interest rates. In turn, the
share price, return, and yield
of a fund that invests in
bonds will vary. That means if
you sell your shares during a
market downturn, you might
lose money. But if you can ride
out the market's ups and
downs, you may have a gain.
(checkmark)
TOTAL RETURN COMPONENTS
YEAR ENDED OCTOBER 31, 1994
DECEMBER 31, (COMMENCEMENT OF
1995 OPERATIONS) TO
DECEMBER 31, 1994

Dividend return 8.74% 0.97%

Capital appreciation return 13.67% -0.80%

Total return 22.41% 0.17%

Dividends per share 9.80(cents) 42.56(cents)

Annualized dividend rate 10.36% 7.81%

30-day annualized yield n/a -

DIVIDENDS per share show the income paid by the class for a set period. If
you annualize this number based on an average share price of $11.14 over
the past month and $10.99 over the life of class, you can compare the
fund's income over these two periods. The 30-day annualized YIELD is a
standard formula for all bond funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you to compare funds from different companies on an equal basis.
Yield information will be reported once the Institutional Class has a
longer operating history.
(dagger) THE DATA USED TO CREATE THE INDICES ON THE LINE GRAPH, ON PAGE 5,
IS FROM THE CLOSE OF BUSINESS ON OCTOBER 31, 1994. THE TOTAL RETURNS OF THE
TWO INDICES FOR THE LIFE OF FUND CALCULATIONS ON PAGE 4 ARE FROM THE
OPENING OF BUSINESS ON OCTOBER 31, 1994, COMMENCEMENT OF OPERATIONS OF THE
FUND. DATA FOR THE STRATEGIC INCOME COMPOSITE BENCHMARK IS ONLY AVAILABLE
AT THE CLOSE OF BUSINESS EACH MONTH.
FUND TALK: THE MANAGER'S OVERVIEW

NOTE TO SHAREHOLDERS: John Carlson became manager of the fund in October
1995. Beginning in January 1996, the fund's separate categories - U.S.
government and investment-grade securities, foreign developed market
securities, emerging market securities and high-yield securities - will be
managed by John and three additional managers under John's direction. The
following is an interview with John on the fund's overall performance and
strategy, and his thoughts on his particular category - emerging market
securities - as well as with Kevin Grant on U.S. government and
investment-grade securities, Margaret Eagle on high-yield securities and
Jonathan Kelly on foreign developed market securities.
Q. HOW DID THE FUND PERFORM, JOHN?
J.C. For the 12-month period ended December 31, 1995, the fund's
Institutional Class shares returned 22.41%. For comparison purposes, the
average general bond fund, as tracked by Lipper Analytical Services,
returned 18.02% for the same period.
Q. WOULD YOU DESCRIBE WHAT THE FIXED-INCOME MARKETS WERE LIKE THIS PAST
YEAR?
J.C. Sure. Global bond markets benefited from slow economic growth, stable
interest rates and relatively low inflation pressures. This became
particularly evident when the central banks of the U.S., Germany and Great
Britain all lowered their respective short-term interest rates. In
particular, emerging markets enjoyed a nice springtime rally following the
announcement of a support package from the international community for
Argentina and Mexico. In the U.S., the high-yield corporate bond market was
the beneficiary of solid corporate earnings during 1995. By far, though,
the 30-year U.S. Treasury bond topped all major fixed income securities
with the exception of zero-coupon bonds. Long-term Treasuries were the
beneficiary of strong demand from yield-hungry Japanese investors.
Q. TURNING TO YOU, KEVIN, WHAT'S BEEN THE STORY IN THE U.S.?
K.G. Like John said, the Treasury market has been the real story. Nineteen
ninety-five was a great year for those who were patient enough to stick
with bonds. The yield curve - a graphical representation of bond yields at
various maturities - flattened during the year. This means that the market
believed the economy had slowed sufficiently and that inflation was not a
problem. Fixed-income investors fear inflation because of the corrosive
effects it has on bonds' income.
Q. SO HOW ARE YOU PUTTING TOGETHER YOUR PART OF THE FUND?
K.G. The fund has significant positions in Treasuries with maturities of
four and seven years and mortgage-backed securities. I've begun to add to
the fund's position in mortgage securities because of their income
advantage over Treasuries. In general, I will look at securities on a
relative value basis. In other words, I will try to take advantage of
securities that may be trading at cheap levels relative to others.
Additionally, investors should keep in mind that while current market
conditions may be positive, there is always the risk that economic
expectations may not play out as anticipated.
Q. HOW DID HIGH-YIELD CORPORATE BOND INVESTORS FARE IN 1995, MARGARET? WHAT
DO YOU SEE GOING FORWARD?
M.E. The high-yield bond market turned in a strong performance in 1995. In
general, the market was driven by investors' demand for a higher level of
income, good corporate earnings and declining interest rates. Looking
ahead, the current environment of slow economic growth and low inflation
should be positive for high-yield bonds. Rather than looking at broad
sectors or industries, I will use fundamental credit analysis to evaluate
opportunities in the high-yield market.
Q. BROADENING OUT A BIT, WHAT'S BEEN THE SITUATION IN THE MORE ESTABLISHED
FOREIGN MARKETS, JONATHAN?
J.K. As John touched on earlier, a general climate of slow growth and
relatively low inflation helped bond markets worldwide - particularly the
U.S. With the exception of Japan, interest rates trended downward in most
regions. Going forward, I will evaluate the global bond portion of the fund
relative to the opportunities of the entire global bond market as
represented by the Salomon Brothers Non-U.S. Dollar World Government Bond
Index. With the assistance of Fidelity's credit and quantitative research
staff in Boston and London, I also plan to evaluate securities on a
case-by-case basis in an effort to find attractively priced bonds for the
fund.
Q. WHAT OPPORTUNITIES DO YOU SEE IN THE FUTURE?
J.K. I'm cautiously optimistic. Economic fundamentals for fixed-income
investments are generally positive in most areas of the world.
Additionally, foreign markets appear undervalued when compared to the U.S.
As with any global portfolio, the performance of the dollar versus other
currencies will play an important role in performance.
Q. COMING BACK TO YOU, JOHN, WHAT AREAS OF THE EMERGING MARKETS HAVE YOU
TARGETED SINCE YOU BEGAN MANAGING THE FUND?
J.C. When I began managing in October, it had a significant cash position.
I put
that cash to work in Latin American corporate bonds. As investors
recognized the value of these bonds, they appreciated in value and their
spreads - the difference in yield compared to U.S. Treasury bonds -
tightened. I then sold these corporate bonds and bought Brady bonds.
Country rotation from Brazil to Argentina to Mexico became the theme for
the rest of the year.
Q. WHAT ARE YOU LOOKING FOR IN THE FUTURE?
J.C. I am optimistic about emerging market debt. Stable interest rates in
the developed world coupled with tight fiscal and monetary policies in
emerging countries may attract more capital. However, I will continue to
monitor the economies, politics and interest rates that can radically
effect the emerging markets.
Q. WHAT IS YOUR GENERAL OUTLOOK FOR THE VARIOUS BOND MARKETS?
J.C. Although most of the world's bond markets had a great 1995, investors
can not expect the same level of price appreciation from most fixed-income
investments in 1996. Additionally, knowing the unpredictability of interest
rates, foreign economies and politics, we will continue to watch global
markets for any radical changes affecting the fund's holdings.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGERS
ONLY
THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER. THE
MANAGERS' VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND OTHER
CONDITIONS.

FUND FACTS
GOAL: seeks a high level of
current income by investing
primarily in debt securities;
the fund may also seek
capital appreciation
START DATE: October 31, 1994
SIZE: as of December 31,
1995, more than $79 million
MANAGER: John Carlson,
since October 1995; joined
Fidelity in June 1995
(checkmark)
JOHN CARLSON ON BRADY BONDS:
"Brady bonds - which are
named after former Bush
administration Treasury
Secretary Nicholas Brady -
are U.S. dollar-denominated
bonds of developing
countries. The Brady bond is
a unique security in that it has
an extremely long duration -
or price sensitivity to changes
in interest rates - and
significant credit exposure. Of
course, an investor is
compensated for their higher
risks with a higher potential
return.
"Being successful in emerging
markets means doing your
homework. First, you need to
consider a country's monetary
policy, fiscal policy and
economic reform programs.
You also have to look at the
demographics of the country.
What's the strength of its local
capital markets? How good
is a country's savings rate or
education level? What are
the country's infrastructure
needs? How fast can it create
jobs?"
INVESTMENT CHANGES

TOP FIVE HOLDINGS AS OF DECEMBER 31, 1995
(BY ISSUER WITH MATURITIES OF % OF FUND'S % OF FUND'S
MORE THAN ONE YEAR) INVESTMENTS INVESTMENTS
6 MONTHS AGO

U.S. Government (various issues) 27.4 24.8

Brazil Federative Republic 3.8 4.6
(various issues)

Argentina Republic (various 3.3 3.3
issues)

French Government (various 3.1 1.3
issues)

Acetex Corp. 9 3/4%, 10/1/03 2.1 0.0

TOP FIVE SECTORS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE SECTORS
6 MONTHS AGO

Media & Leisure 8.8 7.1

Basic Industries 6.5 7.9

Utilities 4.6 1.7

Retail & Wholesale 3.6 3.5

Nondurables 3.4 1.6

QUALITY DIVERSIFICATION AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

Aaa, Aa, A 39.0 37.5

Baa 0.3 0.2

Ba 6.4 7.8

B 31.2 30.8

Caa, Ca, C 2.9 0.1

Nonrated 9.6 12.2

TABLE EXCLUDES SHORT-TERM INVESTMENTS. UNRATED DEBT SECURITIES THAT ARE
EQUIVALENT TO BA AND BELOW AT DECEMBER 31,1995, ACCOUNT FOR 3.8% OF THE
FUND'S INVESTMENTS.
ASSET ALLOCATION
AS OF DECEMBER 31, 1995* AS OF JUNE 30, 1995**
Row: 1, Col: 1, Value: 16.5
Row: 1, Col: 2, Value: 19.2
Row: 1, Col: 3, Value: 27.4
Row: 1, Col: 4, Value: 36.9
Corporate bonds 37.5%
U.S. government
and agency
obligations 24.8%
Foreign government
obligations 21.4%
Short-term and
other investments 16.3%
Corporate bonds 36.8%
U.S. government
and agency
obligations 27.4%
Foreign government
obligations 19.4%
Short-term and
other investments 16.4%
Row: 1, Col: 1, Value: 16.3
Row: 1, Col: 2, Value: 21.4
Row: 1, Col: 3, Value: 24.8
Row: 1, Col: 4, Value: 37.5
* TOTAL FOREIGN
ISSUES 33.1%
** TOTAL FOREIGN
ISSUES 29.1%
INVESTMENTS DECEMBER 31, 1995

Showing Percentage of Total Value of Investments in Securities

NONCONVERTIBLE BONDS - 36.8%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
AEROSPACE & DEFENSE - 1.5%
Alliant Techsystems, Inc. 11 3/4%, 3/1/03 B2 $ 530,000 $ 585,650
Rohr, Inc. 11 5/8%, 5/15/03 Ba3 130,000 140,400
Wyman-Gordon Co. 10 3/4%, 3/15/03 B1 490,000 514,500
1,240,550
BASIC INDUSTRIES - 6.3%
CHEMICALS & PLASTICS - 4.0%
Acetex Corp. 9 3/4%, 10/1/03 (f) B1 1,590,000 1,653,600
NL Industries, Inc. 0%, 10/15/05 (d) B2 1,000,000 770,000
Pioneer Americas Acquisition Corp.
13 3/8%, 4/1/05 (f) B2 500,000 518,750
Trans Resources, Inc. 11 7/8%, 7/1/02 (f) B2 300,000 276,000
3,218,350
METALS & MINING - 0.6%
Kaiser Aluminum & Chemical Corp.
12 3/4%, 2/1/03 B2 450,000 492,750
PAPER & FOREST PRODUCTS - 1.7%
Buckeye Cellulose Corp. 8 1/2%, 12/15/05 Ba3 120,000 123,900
Empaques Ponderosa SA euro
8 3/4%, 12/6/96 - 25,000 24,469
Repap New Brunswick, Inc. yankee
10 5/8%, 4/15/05 B2 470,000 459,425
Stone Container Corp.:
9 7/8%, 2/1/01 B1 140,000 136,150
10 3/4%, 4/1/02 B2 140,000 137,550
10 3/4%, 10/01/02 B1 240,000 248,400
11 1/2%, 10/1/04 B1 90,000 90,000
Tjiwi Kimia International Finance Co.
13 1/4%, 8/1/01 Ba3 150,000 162,000
1,381,894
TOTAL BASIC INDUSTRIES 5,092,994
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
DURABLES - 0.5%
AUTOS, TIRES, & ACCESSORIES - 0.4%
Harvard Industries, Inc. 12%, 7/15/04 B3 $ 300,000 $ 315,000
TEXTILES & APPAREL - 0.1%
Fieldcrest Cannon Inc. 11 1/4%, 6/15/04 B1 110,000 105,600
TOTAL DURABLES 420,600
ENERGY - 1.5%
ENERGY SERVICES - 0.1%
Empire Gas Corp. 7%, 7/15/04 (e) Caa 110,000 94,600
OIL & GAS - 1.4%
Chesapeake Energy Corp. 10 1/2%, 6/1/02 B1 690,000 722,775
Flores & Rucks, Inc. 13 1/2%, 12/1/04 B3 100,000 113,500
United Meridian Corp. 10 3/8%, 10/15/05 B2 300,000 317,250
1,153,525
TOTAL ENERGY 1,248,125
FINANCE - 2.3%
ASSET-BACKED SECURITIES - 0.6%
Premier Auto Trust 4.90%, 12/15/98 Aaa 146,987 146,184
Sears Credit Account Master
Trust II 7%, 1/15/04 Aaa 200,000 209,250
Standard Credit Card Master Trust I:
8 1/4%, 10/7/97 A2 55,000 56,023
7.65%, 2/15/00 A2 30,000 31,116
442,573
BANKS - 0.6%
Deutsche Bank Finance NV
4 1/8%, 11/15/99 (j) Aaa JPY 31,000 326,789
Lake Baden Wuerttemberg Finance NV
euro 3 3/4%, 6/21/99 (j) Aaa JPY 5,000 51,983
Lloyds Bank PLC 7 3/8%, 3/11/04 Aa3 GBP 75,000 110,956
489,728
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
FINANCE - CONTINUED
CREDIT & OTHER FINANCE - 1.0%
General Electric Capital Corp.:
6 1/2%, 2/8/99 Aaa SEK 1,050,000 $ 150,994
7 3/8%, 2/8/99 (j) Aaa ITL 140,000 80,888
HMC Acquisition Properties, Inc.
9%, 12/15/07 (f) Ba3 550,000 555,500
787,382
SAVINGS & LOANS - 0.1%
First Nationwide Holdings, Inc.
12 1/4%, 5/15/01 Ba3 100,000 111,000
TOTAL FINANCE 1,830,683
HEALTH - 1.0%
DRUGS & PHARMACEUTICALS - 0.0%
Glaxo Wellcome PLC euro 8 3/4%, 12/1/05 A1 GBP 25,000 40,513
MEDICAL FACILITIES MANAGEMENT - 1.0%
Tenet Healthcare Corp. 8 5/8%, 12/1/03 Ba2 740,000 773,300
TOTAL HEALTH 813,813
INDUSTRIAL MACHINERY & EQUIPMENT - 1.0%
Howmet Corp. (Del) 10%, 12/1/03 (f) B3 170,000 178,500
MVE, Inc. 12 1/2%, 2/15/02 B3 120,000 118,200
Specialty Equipment Cos., Inc.
11 3/8%, 12/1/03 B3 500,000 507,500
804,200
MEDIA & LEISURE - 7.4%
BROADCASTING - 4.3%
Cablevision System Corp. 9 1/4%, 11/1/05 B3 300,000 313,500
Cooke Media Group, Inc. 11 5/8%, 4/1/99 - 500,000 475,000
Diamond Cable Communications PLC yankee:
0%, 9/30/04 (d) B3 950,000 667,375
0%, 12/15/05 (d) B3 450,000 264,375
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
MEDIA & LEISURE - CONTINUED
BROADCASTING - CONTINUED
Granite Broadcasting Corp. 10 3/8%, 5/15/05 B3 $ 250,000 $ 256,563
Peoples Choice TV Corp. Unit
0%, 6/1/04 (d) Caa 1,250,000 728,125
Robin Media Group, Inc. 11 1/8%, 4/1/97 - 340,000 340,000
Telemundo Group, Inc. 10 1/4%, 12/30/01 - 172,000 171,570
Viacom, Inc. 8%, 7/7/06 B1 200,000 203,500
3,420,008
LODGING & GAMING - 1.9%
Grand Casinos, Inc. 10 1/8%, 12/1/03 Ba3 500,000 521,250
Mohegan Tribal Gaming Authority (Conn)
13 1/2%, 11/15/02 (f) - 440,000 477,400
Players International, Inc. 10 7/8%, 4/15/05 Ba3 550,000 515,625
1,514,275
RESTAURANTS - 1.2%
SC International Services, Inc. 13%, 10/1/05 B3 930,000 985,800
TOTAL MEDIA & LEISURE 5,920,083
NONDURABLES - 3.4%
AGRICULTURE - 0.5%
Hines Horticulture, Inc. 11 3/4%, 10/15/05 (f) B3 360,000 376,200
FOODS - 1.3%
Chiquita Brands International, Inc.:
9 5/8%, 1/15/04 B1 910,000 916,825
9 1/8%, 3/1/04 B1 100,000 98,500
1,015,325
HOUSEHOLD PRODUCTS - 1.6%
Revlon Consumer Products Corp.
10 1/2%, 2/15/03 B3 100,000 102,500
Revlon Worldwide Corp.
secured 0%, 3/15/98 B3 1,610,000 1,193,413
1,295,913
TOTAL NONDURABLES 2,687,438
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
RETAIL & WHOLESALE - 3.2%
APPAREL STORES - 0.3%
Mothers Work, Inc. 12 5/8%, 8/1/05 B3 $ 260,000 $ 255,450
GROCERY STORES - 1.5%
Pathmark Stores, Inc.:
9 5/8%, 5/1/03 B2 80,000 77,700
0%, 11/1/03 (d) B3 400,000 245,000
Ralph's Grocery Co. 11%, 6/15/05 B3 600,000 594,000
Star Markets, Inc. 13%, 11/1/04 B3 300,000 305,250
1,221,950
RETAIL & WHOLESALE, MISCELLANEOUS - 1.4%
Alliance Entertainment Corp.,
Series B 11 1/4%, 7/15/05 B3 430,000 432,688
Corporate Express, Inc., Series B,
9 1/8%, 3/15/04 B3 400,000 403,000
Finlay Fine Jewelry Corp. 10 5/8%, 5/1/03 B1 320,000 304,000
1,139,688
TOTAL RETAIL & WHOLESALE 2,617,088
SERVICES - 2.4%
GOVERNMENT SERVICES - 0.4%
Canada Mortgage & Housing Corp.
8.80%, 3/1/00 Aa1 CAD 50,000 39,598
Guaranteed Export Finance Corp.
PLC 9 1/4%, 3/4/08 - GBP 100,000 170,195
Queensland Treasury Corp.
8%, 8/14/01 Aaa AUD 170,000 126,447
336,240
LEASING & RENTAL - 1.0%
GPA Delaware, Inc. gtd. notes 8 3/4%,
12/15/98 Caa 880,000 820,600
PRINTING - 1.0%
Sullivan Graphics, Inc. 12 3/4%, 8/1/05 Caa 760,000 739,100
TOTAL SERVICES 1,895,940
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
TECHNOLOGY - 1.0%
COMMUNICATIONS EQUIPMENT - 0.9%
Echostar Communications Corp.
0%, 6/1/04 (d) Caa $ 1,000,000 $ 670,000
ELECTRONICS - 0.1%
Grupo Condumex SA de CV:
6 1/4%, 7/27/96 (f) - 50,000 49,000
6 1/4%, 7/27/96 - 50,000 49,000
98,000
TOTAL TECHNOLOGY 768,000
TRANSPORTATION - 0.7%
AIR TRANSPORTATION - 0.7%
US Air, Inc.:
9 5/8%, 2/1/01 B3 210,000 184,275
10%, 7/1/03 B3 450,000 393,750
578,025
UTILITIES - 4.6%
CELLULAR - 3.8%
Comcast Cellular Corp. 0% 3/5/00 B2 810,000 615,600
Comunicaciones Celulares
SA Unit 0%, 11/15/03 (d)(f) B3 75,000 42,563
Fonorola, Inc. 12 1/2%, 8/15/02 B2 1,020,000 1,071,000
International Cabletel, Inc.,
Series A 0%, 4/15/05 (d) - 520,000 328,900
Mobilemedia Corp. 9 3/8%, 11/1/07 B3 120,000 122,700
Pagemart Nationwide, Inc. 0%,
2/1/05 exchangeable (d) - 520,000 338,000
Paging Network, Inc. 8 7/8%, 2/1/06 B2 500,000 512,500
USA Mobile Communications, Inc. II
9 1/2%, 2/1/04 B3 20,000 19,800
3,051,063
ELECTRIC UTILITY - 0.1%
ESKOM (Electricity Supply Commission)
12%, 5/1/96 Baa ZAR 375,000 102,013
GAS - 0.3%
Invergas SA 12 1/2%, 12/16/99 - 200,000 198,000
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
UTILITIES - CONTINUED
TELEPHONE SERVICES - 0.4%
Call-Net Enterprises, Inc. yankee 0%,
12/1/04 (d) B2 $ 330,000 $ 235,950
Telecom Argentina Stet-France Telecom SA
12%, 11/15/02 (f) B1 100,000 106,500
342,450
TOTAL UTILITIES 3,693,526
TOTAL CORPORATE BONDS
(Cost $28,661,145) 29,611,065
U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS - 15.1%
U.S. TREASURY OBLIGATIONS - 12.4%
7 1/4%, 11/15/96 Aaa 170,000 172,815
9%, 5/15/98 Aaa 120,000 129,937
9 1/4%, 8/15/98 Aaa 1,490,000 1,634,336
5 1/8%, 12/31/98 Aaa 227,000 226,219
9 1/8%, 5/15/99 Aaa 3,012,000 3,361,211
7 3/4%, 12/31/99 Aaa 2,295,000 2,490,442
6 1/4%, 2/15/03 Aaa 1,840,000 1,919,635
9,934,595
U.S. GOVERNMENT AGENCY OBLIGATIONS - 2.7%
Federal Home Loan Mortgage Corp.
4.78%, 2/10/97 (callable) Aaa 50,000 49,611
Government Trust Certificates:
(assets of Trust guaranteed by U.S. Government
through Defense Security Assistance Agency):
Class 2-D, 9 1/4%, 11/15/96 Aaa 295,122 300,824
Class T-2, 9.40%, 11/15/96 Aaa 119,595 121,920
Class 1-C, 9 1/4%, 11/15/01 Aaa 58,000 64,432
Class 2-E, 9.40%, 5/15/02 Aaa 210,000 234,291
Class T-2, 9 5/8%, 5/15/02 Aaa 20,000 22,331
(assets of Trust guaranteed by U.S. Government
through Export-Import Bank):
Series 1995-A 6.28%, 6/15/04 Aaa 140,000 142,594
Series 1994-F 8.178%, 12/15/04 Aaa 86,518 94,103
U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
U.S. GOVERNMENT AGENCY OBLIGATIONS - CONTINUED
Private Export Funding Corp.:
secured 9 1/2%, 3/31/99 Aaa $ 30,000 $ 33,550
secured 8 3/4%, 6/30/03 Aaa 100,000 117,391
secured 6.86%, 4/30/04 Aaa 55,250 57,074
State of Israel (guaranteed by U.S. Government
through Agency for International Development):
7 3/4%, 4/1/98 Aaa 7,550 7,746
4 7/8%, 9/15/98 Aaa 40,000 39,488
6%, 2/15/99 Aaa 20,000 20,312
7 1/8%, 8/15/99 Aaa 180,000 189,305
7 3/4%, 11/15/99 Aaa 33,000 35,323
5 3/4%, 3/15/00 Aaa 110,000 110,550
8 1/2%, 4/1/06 Aaa 200,000 230,375
Tennessee Valley Authority 4.60%, 12/15/96 Aaa 75,000 74,427
U.S. Housing & Urban Development
8.27%, 8/1/03 Aaa 210,000 238,153
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS 2,183,800
TOTAL U.S. GOVERNMENT AND GOVERNMENT
AGENCY OBLIGATIONS (Cost $11,903,417) 12,118,395
U.S. GOVERNMENT AGENCY - MORTGAGE-BACKED SECURITIES - 12.3%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 1.1%
6%, 12/1/07 Aaa 187,660 184,695
8 1/2%, 3/1/20 Aaa 708,956 746,035
930,730
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 6.6%
6%, 4/1/01 to 8/1/02 Aaa 1,889,036 1,885,484
6%, 1/1/11 (i) Aaa 2,000,000 1,979,380
6 1/2%, 5/1/08 to 6/1/24 Aaa 744,077 741,472
9%, 12/1/24 Aaa 666,440 701,841
5,308,177
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 4.6%
6 1/2%, 1/15/24 Aaa 299,296 296,862
7%, 12/15/25 Aaa 990,000 1,001,444
7 1/2%, 2/15/22 to 10/15/25 Aaa 2,040,907 2,101,837
11 1/2%, 3/15/10 Aaa 237,734 270,139
3,670,282
TOTAL U.S. GOVERNMENT AGENCY -
MORTGAGE-BACKED SECURITIES
(Cost $9,727,897) 9,909,189
COMMERCIAL MORTGAGE SECURITIES - 0.6%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
Meritor Mortgage Security Corp. commercial
Series 1987-1 Class A3, 9.40%, 6/1/99 Baa $ 32,060 $ 32,301
Resolution Trust Corp.:
commercial Series:
1994-C2 Class E, 8%, 4/25/25 BB+ 236,608 223,521
1995-C1 Class C, 6.90%, 2/25/27 A2 100,000 99,219
Structured Asset Securities Corp. commercial
Series 1995-C1, Class D, 7 3/8%, 9/25/24 BBB 150,000 146,203
TOTAL COMMERCIAL MORTGAGE SECURITIES
(Cost $438,875) 501,244
FOREIGN GOVERNMENT OBLIGATIONS - 19.4% (H)
Argentina Republic :
BOCON:
5.8594%, 4/1/01 (g) B1 765,469 600,301
3.456%, 9/1/02 (g) - ARS 195,819 105,416
Brady:
euro floating rate bond 6.8125%,
3/31/05 (g) B2 1,250,000 890,625
euro par 5%, 3/31/23 (e) B2 1,850,000 1,055,656
Brazil Federative Republic:
Brady:
eligible interest 6.8125%, 4/15/06 (g) B1 1,000,000 688,750
debt conversion bond euro 6 7/8%,
4/15/12 (g) B1 1,200,000 684,000
capitalization bond 8%, 4/15/14 B1 2,175,481 1,244,103
4 1/4%, 4/15/24 (e) B1 800,000 424,500
Canadian Government 8 1/2%, 4/1/02 Aa1 CAD 500,000 398,175
Kingdom of Denmark:
9%, 11/15/98 Aaa DKK 400,000 78,292
Bullet:
9%, 11/15/00 Aaa DKK 400,000 79,960
8%, 5/15/03 Aaa DKK 550,000 105,063
French Government:
OAT 9 1/2%, 1/25/01 Aaa FRF 3,600,000 843,852
8 1/2%, 12/26/12 Aaa FRF 920,000 213,251
German Government 8 3/8%, 5/21/01 Aaa DEM 1,800,000 1,432,615
Kingdom of Belgium:
8 3/4%, 6/25/02 Aa1 BEF 2,500,000 96,539
5.10%, 11/21/04 (g) Aa1 BEF 7,000,000 237,071
7 1/2%, 7/29/08 Aaa BEF 3,000,000 104,396
Kingdom of Sweden 10 1/4%, 5/5/03 Aa1 SEK 700,000 116,041
FOREIGN GOVERNMENT OBLIGATIONS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
Mexican Government:
Brady:
par 6 1/4%, 12/31/19 Ba2 $ 375,000 $ 244,219
par 6 1/4%, 12/31/19 Ba3 1,350,000 879,188
6.60938% 12/31/19 (g) Ba3 300,000 216,563
United Mexican States Securities 0%, 11/27/96
(maturity amount indexed to 28-day Cete
rate or 1-year LIBOR) (f) - 120,000 122,250
Value recovery rights (a) - 2,185,000 22
Netherlands Government:
8 3/4%, 5/1/00 Aaa NLG 100,000 71,113
8 1/2%, 3/15/01 Aaa NLG 55,000 39,201
6 1/2%, 4/15/03 - NLG 650,000 423,470
Philippine Government Brady par 6 1/4%,
12/1/17 (e) Ba2 650,000 485,875
Polish Government Treasury Bills 0% 10/30/96 - PLN 480,000 161,415
Republic of Austria:
euro 4 1/2%, 9/28/05 (j) Aaa JPY 20,000 216,441
7%, 2/14/00 Aaa ATS 900,000 94,973
Republic of Bulgaria Brady discount 6 3/4%,
7/28/24 (g) - 800,000 425,000
Republic of Ecuador Brady
par euro 3%, 2/28/25 (e) - 650,000 234,000
Republic of Italy:
BTPS 9%, 10/01/98 (j) A1 ITL 830,000 510,805
8 1/2%, 4/1/04 (j) A1 ITL 600,000 334,912
Republic of Panama interest reduction
bond (WI) (f) B+ 300,000 135,750
Republic of South Africa 12%, 2/28/05 Baa ZAR 400,000 97,526
Republic of Venezuela
Oil Recovery Rights (a) B+ 2,500 -
Brady debt conversion bond 7 3/8%,
12/18/07 (g) Ba2 250,000 136,563
par A euro 6 3/4%, 3/31/20 Ba2 500,000 285,625
Spanish Government:
11.45%, 8/30/98 (j) Aa2 ESP 15,000 129,485
10 1/4%, 11/30/98 (j) Aa ESP 25,000 42,106
10.9%, 8/30/03 (j) Aa2 ESP 22,000 192,225
Treuhandstalt 7 3/8%, 12/2/02 Aaa DEM 250,000 190,455
United Kingdom:
Treasury:
10%, 2/26/01 Aaa GBP 180,000 315,335
9 3/4%, 8/27/02 Aaa GBP 110,000 193,662
TOTAL FOREIGN GOVERNMENT OBLIGATIONS
(Cost $14,602,666) 15,576,785
SUPRANATIONAL OBLIGATIONS - 3.3%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (C) AMOUNT (B) (NOTE 1)
European Investment Bank
5 7/8%, 11/26/99 Aaa JPY 5,000,000 $ 56,141
InterAmerica Development Bank euro 6%,
10/30/01 (j) Aaa JPY 60,000 693,424
International Bank Reconstruction & Development:
4 1/2%, 6/20/00 (j) Aaa JPY 105,000 1,136,315
euro 6%, 10/30/01 (j) Aaa JPY 20,000 232,302
4 3/4%, 1/15/04 (j) Aaa JPY 45,000 500,266
TOTAL SUPRANATIONAL OBLIGATIONS
(Cost $2,763,440) 2,618,448
COMMON STOCKS - 0.7%
SHARES
HEALTH - 0.0%
MEDICAL EQUIPMENT & SUPPLIES - 0.0%
MVE, Inc. (warrants) (a) 210 3,150
HOLDING COMPANIES - 0.6%
SDW Holdings Corp.:
(warrants) (a) 16,500 82,500
Unit (a)(f) 1,300 390,000
472,500
MEDIA & LEISURE - 0.0%
LEISURE DURABLES & TOYS - 0.0%
IHF Capital, Inc., Series I (warrants) (a)(f) 270 6,750
TECHNOLOGY - 0.1%
COMMUNICATIONS EQUIPMENT - 0.1%
Echostar Communications Corp. Class A 3,645 88,391
UTILITIES - 0.0%
CELLULAR - 0.0%
Pagemart Nationwide, Inc. (non-vtg) (a) 2,100 18,900
TOTAL COMMON STOCKS
(Cost $497,922) 589,691
PREFERRED STOCKS - 3.4%
SHARES VALUE
(NOTE 1)
CONVERTIBLE PREFERRED STOCKS - 0.4%
RETAIL & WHOLESALE - 0.4%
GROCERY STORES - 0.4%
Supermarkets General Holdings Corp.
exchangeable pay-in-kind $3.52 (a) 10,665 $ 290,621
UTILITIES - 0.0%
GAS - 0.0%
Columbia Gas System, Inc. (DECS) 576 23,544
TOTAL CONVERTIBLE PREFERRED STOCKS 314,165
NONCONVERTIBLE PREFERRED STOCKS - 3.0%
BASIC INDUSTRIES - 0.6%
PAPER & FOREST PRODUCTS - 0.6%
S D Warren Co. exchangeable pay-in-kind 16,500 519,750
FINANCE - 0.9%
SAVINGS & LOANS - 0.9%
First Nationwide Bank 11 1/2%, 1,730 194,193
Greater New York Savings Bank
Series B, perpetual 12% 18,787 540,126
734,319
MEDIA & LEISURE - 1.5%
BROADCASTING - 1.5%
Cablevision System Corp.,
Series G exchangeable pay-in-kind (f) 7,506 776,873
PanAmSat Corp. 12 3/4% pay-in-kind 346 387,520
1,164,393
UTILITIES - 0.0%
GAS - 0.0%
Columbia Gas System, Inc. 941 23,170
TOTAL NONCONVERTIBLE PREFERRED STOCKS 2,441,632
TOTAL PREFERRED STOCKS
(Cost $2,365,086) 2,755,797
OTHER SECURITIES - 2.2%
PRINCIPAL VALUE
AMOUNT (B) (NOTE 1)
PURCHASED BANK DEBT - 2.2%
Bank for Foreign Economic Affairs of the
USSR (Vnesheconombank) loan participation (a) 2,150,000 $ 731,000
Kingdom of Morocco, Series A loan participation
6.59375%, 1/1/09 (g) 760,000 509,200
Republic of Panama loan participation refinanced
under credit agreement (a) 500,000 370,000
Republic of Peru loan participation
under 1983 agreement 240,000 174,300
TOTAL OTHER SECURITIES
(Cost $1,502,915) 1,784,500
REPURCHASE AGREEMENTS - 6.2%
MATURITY
AMOUNT
Investments in repurchase agreements
(U.S. Treasury obligations) in a joint
trading account at 5.88% dated
12/29/95 due 1/2/96 $ 4,952,233 4,949,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $77,412,363) $ 80,414,114
CURRENCY ABBREVIATIONS
ARS - Argentine peso
AUD - Australian dollar
ATS - Austrian schilling
BEF - Belgian franc
GBP - British pound
CAD - Canadian dollar
DKK - Danish krone
NLG - Dutch guilder
FRF - French franc
DEM - German deutsche mark
ITL - Italian lira
JPY - Japanese yen
PLN - Polish zlota
ZAR - South African rand
ESP - Spanish peseta
SEK - Swedish krona
LEGEND
(1.) Non-income producing
(2.) Principal amount is stated in United States dollars unless otherwise
noted.
(3.) Standard & Poor's Corporation credit ratings are used in the absence
of a rating by Moody's Investors Service, Inc.
(4.) Debt obligation initially issued in zero coupon form which converts to
coupon form at a specified rate and date.
(5.) Debt obligation initially issued at one coupon which converts to a
higher coupon at a specified date.
(6.) 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 $5,665,634 or 7.1% of net
assets.
(7.) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(8.) Some foreign government obligations have not been individually rated
by S&P or Moody's. The ratings listed are assigned to securities by FMR,
the fund's investment adviser, based principally on S&P and Moody's ratings
of the sovereign credit of the issuing government.
(9.) Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
(10.) Principal amount in thousands.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 39.0% AAA, AA, A 38.2%
Baa 0.3% BBB 0.4%
Ba 6.4% BB 10.5%
B 31.2% B 24.8%
Caa 2.9% CCC 2.7%
Ca, C 0.0% CC, C 0.0%
D 0.0%
For some foreign government obligations, FMR has assigned the ratings of
the sovereign credit of the issuing government. The percentage not rated by
either S&P or Moody's amounted to 7.3%. FMR has determined that unrated
debt securities that are lower quality account for 3.8% of the total value
of investment in securities.
Distribution of investments by country of issue, as a percentage of total
value of investment in securities, is as follows:
United States 66.9%
Brazil 3.9
Canada 3.6
Multi-National 3.2
Argentina 2.7
Germany 2.6
Mexico 2.5
United Kingdom 2.3
Republic of Russia 1.5
France 1.4
Panama 1.2
Venezuela 1.1
Italy 1.1
Ireland 1.0
Others (individually less than 1%) 5.0
TOTAL 100.0%
INCOME TAX INFORMATION
At December 31, 1995, the aggregate cost of investment securities for
income tax purposes was $77,426,708. Net unrealized appreciation aggregated
$2,987,406, of which $3,387,304 related to appreciated investment
securities and $399,898 related to depreciated investment securities.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
DECEMBER 31, 1995

ASSETS

Investment in securities, at value (including repurchase $ 80,414,114
agreements of $4,949,000) (cost $77,412,363) -
See accompanying schedule

Cash 775,731

Receivable for investments sold 108,416

Dividends receivable 23,288

Interest receivable 1,352,481

Prepaid expenses 9,127

TOTAL ASSETS 82,683,157

LIABILITIES

Payable for investments purchased $ 932,349
Regular delivery

Delayed delivery 1,975,042

Distributions payable 241,417

Accrued management fee 26,878

Distribution fees payable 32,093

Other payables and accrued expenses 87,827

TOTAL LIABILITIES 3,295,606

NET ASSETS $ 79,387,551

Net Assets consist of: $ 75,821,112
Paid in capital

Undistributed net investment income 33,845

Accumulated undistributed net realized gain (loss) on 530,954
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 3,001,640
investments and assets and liabilities in foreign
currencies

NET ASSETS $ 79,387,551

CALCULATION OF MAXIMUM OFFERING PRICE $11.00
CLASS A:
NET ASSET VALUE, and redemption price per share
($52,626,017 (divided by) 4,782,675 shares)

Maximum offering price per share (100/95.25 of $11.00) $11.55

CLASS B: $11.01
NET ASSET VALUE, offering price and redemption price per

share ($26,654,100 (divided by) 2,420,771 shares) A

INSTITUTIONAL CLASS: $11.03
NET ASSET VALUE, offering price and redemption price per

share ($107,434 (divided by) 9,740 shares)

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED DECEMBER 31, 1995

INVESTMENT INCOME $ 98,226
Dividends

Interest 3,906,748

TOTAL INCOME 4,004,974

EXPENSES

Management fee $ 277,990

Transfer agent fees 67,377
Class A

Class B 37,484

Institutional Class 443

Distribution fees 68,959
Class A

Class B 186,313

Accounting fees and expenses 45,067

Non-interested trustees' compensation 161

Custodian fees and expenses 15,450

Registration fees 58,085
Class A

Class B 52,103

Institutional Class 14,413

Audit 34,970

Legal 2,239

Reports to shareholders 535

Miscellaneous 361

Total expenses before reductions 861,950

Expense reductions (95,753) 766,197

NET INVESTMENT INCOME 3,238,777

REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:

Investment securities 2,578,567

Foreign currency transactions (56,757) 2,521,810

Change in net unrealized appreciation (depreciation) on:

Investment securities 2,993,350

Assets and liabilities in foreign currencies 9,110 3,002,460

NET GAIN (LOSS) 5,524,270

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 8,763,047
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1994
DECEMBER 31, (COMMENCEMENT
1995 OF OPERATIONS) TO
DECEMBER 31,
1994

INCREASE (DECREASE) IN NET ASSETS

Operations $ 3,238,777 $ 93,779
Net investment income

Net realized gain (loss) 2,521,810 (166,394)

Change in net unrealized appreciation (depreciation) 3,002,460 (820)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 8,763,047 (73,435)
FROM OPERATIONS

Distributions to shareholders
From net investment income

Class A (2,143,447) (53,334)

Class B (1,275,191) (45,552)

Institutional Class (3,950) -

From net realized gain (1,060,007) -
Class A

Class B (539,517) -

Institutional Class (2,175) -

TOTAL DISTRIBUTIONS (5,024,287) (98,886)

Share transactions - net increase (decrease) 55,582,973 20,238,139

TOTAL INCREASE (DECREASE) IN NET ASSETS 59,321,733 20,065,818

NET ASSETS

Beginning of period 20,065,818 -

End of period (including under (over) distribution $ 79,387,551 $ 20,065,818
of net investment income of $33,845 and
$(163,199), respectively)

</TABLE>

FINANCIAL HIGHLIGHTS - CLASS A
YEARS ENDED DECEMBER 31,

1995 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 9.920 $ 10.000

Income from Investment Operations

Net investment income .885 .064 E

Net realized and unrealized gain (loss) 1.231 (.046)

Total from investment operations 2.116 .018

Less Distributions

From net investment income (.806) (.098)

From net realized gain (.230) -

Total distributions (1.036) (.098)

Net asset value, end of period $ 11.000 $ 9.920

TOTAL RETURN B, C 22.02% .17%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 52,626 $ 10,687

Ratio of expenses to average net assets 1.35% F 1.35% A,
F

Ratio of net investment income to average net assets 7.28% 5.80% A

Portfolio turnover 193% 104% A

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
D FOR THE PERIOD OCTOBER 31, 1994 (COMMENCEMENT OF SALE OF CLASS A SHARES)
TO DECEMBER 31, 1994.
E NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
F FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSES WOULD
HAVE BEEN HIGHER.
FINANCIAL HIGHLIGHTS - CLASS B

<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED DECEMBER
31,

1995 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 9.910 $ 10.000

Income from Investment Operations

Net investment income .820 .072 E

Net realized and unrealized gain (loss) 1.237 (.078)

Total from investment operations 2.057 (.006)

Less Distributions

From net investment income (.727) (.084)

From net realized gain (.230) -

Total distributions (.957) (.084)

Net asset value, end of period $ 11.010 $ 9.910

TOTAL RETURN B, C 21.35% (.06)%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 26,654 $ 9,379

Ratio of expenses to average net assets 2.10% F 2.10% A
, F

Ratio of net investment income to average net assets 6.53% 5.06% A

Portfolio turnover 193% 104% A

</TABLE>

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
D FOR THE PERIOD OCTOBER 31, 1994 (COMMENCEMENT OF SALE OF CLASS B SHARES)
TO DECEMBER 31, 1994.
E NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
F FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSES WOULD
HAVE BEEN HIGHER.
FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS
YEAR ENDED
DECEMBER 31,

1995 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 10.890

Income from Investment Operations

Net investment income .456

Net realized and unrealized gain (loss) .340

Total from investment operations .796

Less Distributions

From net investment income (.426)

From net realized gain (.230)

Total distributions (.656)

Net asset value, end of period $ 11.030

TOTAL RETURN B, C 7.47%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 107

Ratio of expenses to average net assets 1.10% A,
E

Ratio of net investment income to average net assets 7.53% A

Portfolio turnover 193%

A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
D FOR THE PERIOD JULY 3, 1995 (COMMENCEMENT OF SALE OF INSTITUTIONAL CLASS
SHARES) TO DECEMBER 31, 1995.
E FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSES WOULD
HAVE BEEN HIGHER.
NOTES TO FINANCIAL STATEMENTS
For the period ended December 31, 1995

1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Advisor Strategic Income Fund (the fund) is a fund of Fidelity
Advisor Series VIII (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 B, 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 its distribution plan. The fund
commenced sale of Institutional Class shares on July 3, 1995. Investment
income, realized and unrealized capital gains and losses, and the common
expenses of the fund 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, registration, and certain other class-specific fees and expenses.
The following summarizes the significant accounting policies of the fund:
SECURITY VALUATION. 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 (sales prices if the principal market is an
exchange) in the principal market in which such securities are normally
traded. Securities for which market quotations are not readily available
(and in certain cases debt securities which trade on an exchange) are
valued primarily using dealer supplied valuations or at their fair value as
determined in good faith under consistently applied procedures under the
general supervision of the Board of Trustees. Short-term securities
maturing within sixty days of their purchase date are valued at amortized
cost or original cost plus accrued interest, both of which approximate
current value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Purchases and
sales of securities, income receipts, and expense payments are translated
into U.S. dollars at the prevailing exchange rate on the respective dates
of the transactions.
Net realized gains and losses on foreign currency transactions represent
net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, currency gains and losses
realized between the trade and settlement dates on securities transactions,
and the difference between the amount of net investment income accrued and
the U.S. dollar amount actually received. The effects of changes in foreign
currency exchange rates on investments in securities are included with the
net realized and unrealized gain or loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to U.S. federal
income taxes to the extent that it distributes substantially
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
INCOME TAXES - CONTINUED
all of its taxable income for its fiscal year. The fund may be subject to
foreign taxes on income, gains on investments or currency repatriation. The
fund accrues such taxes as applicable. The schedule of investments includes
information regarding income taxes under the caption "Income Tax
Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. 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 the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
PREPAID EXPENSES. FMR bears all organizational expenses except for
registering and qualifying each class and shares of each class for
distribution under federal and state securities law. These expenses are
borne by each class and amortized over one year.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net investment income. Distributions from realized gains, if
any, are recorded on the ex-dividend date. Income dividends are declared
separately for each class, while capital gain distributions are declared at
the fund level and allocated to each class on a pro rata basis based on the
number of shares held by each class on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for foreign
currency transactions, market discount, and excise tax regulations. The
fund also utilized earnings and profits distributed to shareholders on
redemption of shares as a part of the dividends paid deduction for income
tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net investment income and realized
and unrealized gain (loss). Undistributed net investment income and
accumulated undistributed net realized gain (loss) on investments and
foreign currency transactions may include temporary book and tax basis
differences which will reverse in a subsequent period. Any taxable income
or gain remaining at fiscal year end is distributed in the following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
FORWARD FOREIGN CURRENCY CONTRACTS. The fund may use foreign currency
contracts to facilitate transactions in foreign securities and to manage
the fund's currency exposure. Contracts to buy generally are used to
acquire exposure to foreign currencies, while contracts to sell are used to
hedge the fund's investments against currency fluctuations. Also, a
contract to buy or sell can offset a previous contract. 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 forward foreign currency contracts is determined
using forward currency exchange rates supplied by a quotation service.
Purchases and sales of forward foreign currency contracts having the same
settlement date and broker are offset and any realized gain (loss) is
recognized on the date of offset; otherwise, gain (loss) is recognized on
settlement date.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission , the fund, along with other affiliated
entities of Fidelity Management & Research Company (FMR), may transfer
uninvested cash balances into one or more joint trading accounts. These
balances are invested in one or more repurchase agreements that mature in
60 days or less from the date of purchase, and are collateralized by U.S.
Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying U.S. Treasury or Federal Agency securities, the market
value of which is required to be at least equal to the repurchase price.
For term repurchase agreement transactions, the underlying securities are
marked-to-market daily and maintained at a value at least equal to the
repurchase price. 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.
DELAYED DELIVERY TRANSACTIONS. The fund may purchase or sell securities on
a when-issued or forward commitment basis. Payment and delivery may take
place a month or more after the date of the transaction. The price of the
underlying securities and the date when the securities will be delivered
and paid for are fixed at the time the transaction is negotiated. Losses
may arise due to changes in the market value of the underlying securities
or if the counterparty does not perform under the contract.
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $138,949,977 and $84,673,087, respectively, of which U.S.
government and government agency obligations aggregated $56,996,735 and
$40,384,492, 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 .1200% to .3700% for the period. In the event that these
rates were lower than the contractual rates in effect during the period,
FMR voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. The annual individual fund fee rate is .45%. For
the period, the management fee was equivalent to an annual rate of .60% of
average net assets.
The Board of Trustees has approved a new group fee rate schedule with rates
ranging from .1100% to .3700%. Effective January 1, 1996, FMR voluntarily
agreed to implement this new group fee rate schedule as it results in the
same or a lower management fee.
DISTRIBUTION AND SERVICE PLAN.
In accordance with Rule 12b-1 of the 1940 Act, the Trustees have adopted
separate distribution plans with respect to the fund's Class A shares (
"Class A Plan"), Class B shares ( "Class B Plan"), and Institutional Class
shares (collectively referred to as "the Plans"). Under the Class A Plan
and Class B Plan, the fund pays Fidelity Distributors Corporation (FDC), an
affiliate of FMR, a distribution and service fee. This fee is based on
annual rates of .25% and 1.00% (of which .75% represents a distribution fee
and .25% represents a shareholder service fee) of the average net assets of
the Class A and Class B shares, respectively. Effective January 1, 1996,
the Board of Trustees approved a revised Class B distribution plan. Under
the revised plan, the fee is based on an annual rate of .90% (of which .65%
represents a distribution fee and .25% represents a shareholder service
fee) of the average net assets of the Class B shares. For the period, the
fund paid FDC $68,959 and $186,313 under the Class A Plan and Class B Plan,
respectively, of which $62,957 and $46,578 were paid to securities dealers,
banks and other financial institutions for the distribution of Class A and
Class B shares, respectively, and providing shareholder support services.
Under the Plans, FMR or FDC may use its resources to pay administrative and
promotional expenses related to the sale of the fund's Class A, Class B,
and Institutional Class shares. The Plans also authorize payments to third
parties that assist in the sale of the fund's shares or render shareholder
support services. FMR or FDC has informed the fund that payments made to
third parties during the period under the Plans amounted to $89, $0, and $0
for Class A, Class B, and Institutional Class, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SALES LOAD. FDC receives a front-end sales charge of up to 4.75% for
selling Class A shares of the fund. Effective January 1, 1996, the Board of
Trustees approved a revised Class A sales charge. Under the revised
arrangement, FDC receives a front-end sales charge of up to 3.50% for
selling Class A shares of the fund. For the period, FDC received sales
charges of $842,000 on sales of Class A shares of the fund, of which
$741,095 was paid to securities dealers, banks, and other financial
institutions. FDC also receives the proceeds of a contingent deferred sales
charge levied on Class B share redemptions occurring within five years of
purchase. The charge is based on declining rates which range from 4% to 1%
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. For the period, FDC received contingent deferred sales
charges of $23,689 on Class B share redemptions from the fund. When Class B
shares are sold, FDC pays commissions from its own resources to dealers
through which the sales are made.
TRANSFER AGENT FEES. State Street Bank and Trust Company (State Street) is
the transfer, dividend disbursing, and shareholder servicing agent for the
fund's Class A shares, while Fidelity Investments Institutional Operations
Company (FIIOC), an affiliate of FMR (collectively, with State Street,
referred to as the Transfer Agents) acts in that capacity for the fund's
Class B and Institutional Class shares. The Transfer Agents receive account
fees and asset-based fees that vary according to the account size and type
of account of the shareholders of the respective classes of the fund. With
respect to the Class A shares, State Street has delegated certain transfer,
dividend paying, and shareholder services to FIIOC for which FIIOC receives
its allocable share of all such fees. FIIOC pays for typesetting, printing
and mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annual rate of .24%,
.20%, and .87% (annualized) of average net assets for Class A, Class B, and
Institutional Class, respectively.
ACCOUNTING FEES. Fidelity Service Co. (FSC), an affiliate of FMR, maintains
the fund's accounting records. The fee is based on the level of average net
assets for the month plus out-of-pocket expenses.
5. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse operating expenses (excluding interest,
taxes, brokerage commissions and extraordinary expenses) above an annual
rate of 1.35%, 2.10%, and 1.10% of average net assets for Class A, Class B,
and Institutional Class, respectively. For the period, the reimbursement
reduced expenses by $43,412, $37,644, and $14,697 for Class A, Class B, and
Institutional Class, respectively.
6. SHARE TRANSACTIONS.
Share transactions for each class of shares were as follows:
SHARES DOLLARS
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED DECEMBER 31, DECEMBER 31,
DECEMBER 31, DECEMBER 31,
1995 B 1994 A 1995 B 1994 A

CLASS A
Shares sold 4,244,040 1,089,553 $ 45,511,133 $ 10,913,598
Reinvestment of distributions 252,211 4,800 2,745,208 47,705
Shares redeemed (791,295) (16,634) (8,398,421) (187,175)
Net increase (decrease) 3,704,956 1,077,719 $ 39,857,920 $ 10,774,128
CLASS B
Shares sold 1,562,341 983,229 $ 16,458,839 $ 9,833,907
Reinvestment of distributions 147,710 4,120 1,605,499 40,895
Shares redeemed (235,345) (41,284) (2,445,410) (410,791)
Net increase (decrease) 1,474,706 946,065 $ 15,618,928 $ 9,464,011
INSTITUTIONAL CLASS
Shares sold 9,183 - $ 100,000 $ -
Reinvestment of distributions 557 - 6,125 -
Shares redeemed (-) - (-) -
Net increase (decrease) 9,740 - $ 106,125 $ -
A SHARE TRANSACTIONS FOR CLASS A AND CLASS B ARE FOR THE PERIOD OCTOBER 31,
1994 (COMMENCEMENT OF SALE OF SHARES) TO DECEMBER 31, 1994.
B SHARE TRANSACTIONS FOR INSTITUTIONAL CLASS ARE FOR THE PERIOD JULY 3,
1995 (COMMENCEMENT OF SALE OF SHARES) TO DECEMBER 31, 1995.
REPORT OF INDEPENDENT ACCOUNTANTS

To the Trustees of Fidelity Advisor Series VIII and the Shareholders of
Fidelity Advisor Strategic Income Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Advisor Series VIII: Fidelity Advisor Strategic Income Fund,
including the schedule of portfolio investments, as of December 31, 1995,
and the related statement of operations for the year then ended, the
statement of changes in net assets for the year then ended and the period
October 31, 1994 (commencement of operations) to December 31, 1994 and the
financial highlights for the year then ended and for the period October 31,
1994 (commencement of operations) to December 31, 1994 for Classes A and B
and July 3, 1995 (commencement of sale of Institutional Class shares) to
December 31, 1995 for the Institutional Class. These financial statements
and financial highlights are the responsibility of the fund's management.
Our responsibility is to express an opinion on these financial statements
and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of December 31, 1995 by correspondence with the
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Advisor Series VIII: Fidelity Advisor Strategic Income Fund as
of December 31, 1995, the results of its operations for the year then
ended, the changes in its net assets for the year then ended and for the
period October 31, 1994 (commencement of operations) to December 31, 1994,
and the financial highlights for the year then ended and for the period
October 31, 1994 (commencement of operations) to December 31, 1994 for
Class A and Class B and July 3, 1995 (commencement of sale of Institutional
Class shares) to December 31, 1995 for the Institutional Class, in
conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
February 6, 1996
DISTRIBUTIONS

The Board of Trustees of Fidelity Advisor Strategic Income Fund voted to
pay to shareholders of record at the opening of business on record date,
the following distributions derived from capital gains realized from sales
of portfolio securities:
PAY DATE RECORD DATE CAPITAL GAINS
Class A: 2/5/96 2/2/96 $0.06
Class B: 2/5/96 2/2/96 $0.06
Institutional Class: 2/5/96 2/2/96 $0.06

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research
(U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
Fidelity Investments Japan Limited,
Tokyo, Japan
Fidelity International Investment Advisors,
Pembroke, Bermuda
Fidelity International Investment Advisors (U.K.) Limited, London, England
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Robert A. Lawrence, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
Fidelity Investments Institutional
Operations Company
Boston, MA
CUSTODIAN
Bank of New York
New York, NY
GROWTH FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Growth
Opportunities Fund
Fidelity Advisor Strategic
Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Income Fund
Fidelity Advisor Income & Growth Fund
TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Government Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund
MUNICIPAL FUNDS
Fidelity Advisor High Income
Municipal Fund
Fidelity Advisor Intermediate Municipal Income Fund
Fidelity Advisor Short-Intermediate Municipal Income Fund
STATE MUNICIPAL FUNDS
Fidelity Advisor New York Municipal Income Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)
(registered trademark)
* INDEPENDENT TRUSTEES

(2_FIDELITY_LOGOS)FIDELITY ADVISOR
(registered trademark)

STRATEGIC INCOME
FUND - CLASS A AND CLASS B
ANNUAL REPORT
DECEMBER 31, 1995
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.

PERFORMANCE 4 How the fund has done over time.

FUND TALK 11 The manager's review of fund
performance, strategy and outlook.

INVESTMENT CHANGES 15 A summary of major shifts in the
fund's investments over the past six
months.

INVESTMENTS 16 A complete list of the fund's
investments with their market
values.

FINANCIAL STATEMENTS 31 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 37 Notes to the financial statements.

REPORT OF INDEPENDENT 43 The auditors' opinion.
ACCOUNTANTS

DISTRIBUTIONS 44

DEAR SHAREHOLDER:
Although the markets were fairly positive in 1995, no one can predict what
lies ahead for investors. The previous year, stocks posted below-average
returns and bonds had one of the worst years in history. This downturn
followed a period in which the investing environment was generally very
positive.
These market ups and downs are a normal part of investing, and there are
some basic principles that are helpful for investors to remember in
different types of markets.
Keeping in mind that the effects of interest rate changes on your bond
investments will only be "paper" gains or losses unless you sell your
shares, staying in your bond fund may be appropriate if your investment
horizon is at least a year or more. The longer your investing time frame,
the more likely it is that you will retain your principal investment
through both up and down markets. For example, a 10-year time frame, such
as saving
for a college education, enables you to weather these ups and downs in a
long-term fund, which has higher potential returns. An intermediate-length
fund could be appropriate if your investment horizon is two to four years,
and a short-term bond fund could be the right choice if you need your money
in one or two years.
If your time horizon is less than a year, you might want to consider moving
some of your bond investment into a money market fund, which seeks income
and a stable share price by investing in high-quality, short-term
investments. Of course, there is no assurance that a money market fund will
achieve its goal, and it is important to remember that money market funds
are not insured or guaranteed by any agency of the U.S. government.
No matter what your investment horizon or portfolio diversity, it makes
good sense to follow a regular investment plan - investing a certain amount
of money at the same time each month or quarter - and to review your
portfolio periodically. A periodic investment plan will not, of course,
assure a profit or protect against a loss.
Remember to contact your investment professional if you need help with your
investments.
Best regards,
Edward C. Johnson 3d
ADVISOR STRATEGIC INCOME FUND - CLASS A
PERFORMANCE: THE BOTTOM LINE(dagger)

Advisor Strategic Income - Class A 22.02% 22.24%

Advisor Strategic Income - Class A
(incl. max. 3.50% sales charge) 1 17.75% 17.96%

Merrill Lynch High Yield Master Index 19.91% 20.36%

Fidelity Strategic Income Composite 19.82% n/a
Benchmark

Average General Bond Fund 18.02% 16.57%

CUMULATIVE TOTAL RETURNS show Class A's performance in percentage terms
over a set period - in this case, one year or since the fund started on
October 31, 1994. 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 those of the Merrill Lynch
High Yield Master Index - a broad measure of the high yield bond market, or
the Fidelity Strategic Income Composite Benchmark - a broad measure of the
world fixed income markets. To measure how Class A's performance stacked up
against its peers, you can compare it to the average general bond fund,
which reflects the performance of 64 funds with similar objectives tracked
by Lipper Analytical Services over the past 12 months. These benchmarks
include reinvested dividends and capital gains, if any, and exclude the
effects of sales charges. Recent U.S. Consumer Price Index (CPI)
information is not available from the U.S. Department of Labor. Therefore,
the CPI comparison has not been included in this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Strategic Income - Class A 22.02% 18.72%

Advisor Strategic Income - Class A
(incl. max. 3.50% sales charge) 1 17.75% 15.16%

Merrill Lynch High Yield Master Index 19.91% 17.16%

Fidelity Strategic Income Composite 19.82% n/a
Benchmark

Average General Bond Fund 18.02% 14.04%

AVERAGE ANNUAL TOTAL RETURNS take Class A shares' actual (or cumulative)
return and show you what would have happened if Class A shares had
performed at a constant rate each year.

1 HAD THE FORMER MAXIMUM 4.75% SALES CHARGE BEEN REFLECTED, THE CUMULATIVE
AND AVERAGE ANNUAL TOTAL RETURNS FOR THE PAST ONE YEAR AND LIFE OF FUND
WOULD HAVE BEEN 16.23% AND 16.43%, 16.23% AND 13.89%, RESPECTIVELY.
$10,000 OVER LIFE OF FUND
FA Strat Inc Cl A (638) High Yield Master Fid Strat Inc Comp
10/31/94 9650.00 10000.00 10000.00
11/30/94 9698.40 9914.94 9921.26
12/31/94 9666.83 10025.22 9887.56
01/31/95 9774.68 10166.88 9962.57
02/28/95 10005.55 10484.10 10125.61
03/31/95 10150.73 10630.00 10301.07
04/30/95 10531.53 10878.89 10634.09
05/31/95 10927.88 11218.77 11037.19
06/30/95 10983.77 11304.46 11135.32
07/31/95 11072.01 11433.70 11192.91
08/31/95 11089.52 11503.09 11198.60
09/30/95 11286.98 11634.70 11390.44
10/31/95 11418.00 11717.17 11444.44
11/30/95 11545.52 11831.55 11595.55
12/31/95 11795.90 12021.46 11847.24

$10,000 OVER LIFE OF FUND(dagger): Let's say you invested $10,000 in
Fidelity Advisor Strategic Income Fund - Class A on October 31, 1994, when
the fund started, and paid the current maximum 3.50% sales charge. As the
chart shows, by December 31, 1995, the value of your investment would have
grown to $11,796 - a 17.96% increase on your initial investment. For
comparison, look at how the Merrill Lynch High Yield Master Index did over
the same period. With dividends reinvested, the same $10,000 investment
would have grown to $12,021 - a 20.21% increase. You also can look at how
the Fidelity Strategic Income Composite Benchmark, a hypothetical
combination of unmanaged indices that is more representative of the fund's
investable universe, did over the same period. This index combines returns
from the JP Morgan Emerging Markets Bond Index Plus (15%), Merrill Lynch
High Yield Master Index (40%), Salomon Brothers Mortgage Index (15%),
Salomon Brothers Treasury 1-10 Year Index (15%), and Salomon Brothers
Non-U.S. Dollar World Government Bond Index (15%). With distributions, if
any, reinvested, a $10,000 investment in the index would have grown to
$11,847 - an 18.47% increase.

Dividend return 8.65% 0.97%

Capital appreciation return 13.37% -0.80%

Total return 22.02% 0.17%

DIVIDEND returns and capital appreciation returns are both part of a class'
total return. A dividend return reflects the actual dividends paid by the
class. A capital appreciation return reflects both the amount paid by the
class to shareholders as capital gain distributions and changes in the
class' share price. Both returns assume the dividends or gains are
reinvested and exclude the effects of sales charges.
DIVIDENDS AND YIELD
PERIOD ENDED DECEMBER 31, 1995 PAST PAST 6 PAST 1
MONTH MONTHS YEAR

Dividends per share 9.80(cents) 42.61(cents) 80.60(cents)

Annualized dividend rate 10.38% 7.70% 7.55%

30-day annualized yield 7.40% - -

DIVIDENDS per share show the income paid by the class for a set period. If
you annualize this number, based on an average share price of $11.12 over
the past month, $10.97 over the past six months, and $10.67 over the past
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all bond funds based on
the yields of the bonds in the fund, averaged over the past 30 days. This
figure shows you the yield characteristics of the fund's investments at the
end of the period. It also helps you to compare funds from different
companies on an equal basis. The offering share price used in the
calculation of the yield includes the effect of Class A's maximum 3.50%
sales charge. Had Class A's prior 4.75% sales charge been reflected, the 30
day annualized yield would have been 7.30%.
(dagger) THE DATA USED TO CREATE THE INDICES ON THE LINE GRAPH, ON PAGE 5,
IS FROM THE CLOSE OF BUSINESS ON OCTOBER 31, 1994. THE TOTAL RETURNS OF THE
TWO INDICES FOR THE LIFE OF FUND CALCULATIONS ON PAGE 4 ARE FROM THE
OPENING OF BUSINESS ON OCTOBER 31, 1994, COMMENCEMENT OF OPERATIONS OF THE
FUND. DATA FOR THE STRATEGIC INCOME COMPOSITE BENCHMARK IS ONLY AVAILABLE
AT THE CLOSE OF BUSINESS EACH MONTH.
ADVISOR STRATEGIC INCOME FUND - CLASS B
PERFORMANCE: THE BOTTOM LINE(dagger)

Advisor Strategic Income - Class B 21.35% 21.28%

Advisor Strategic Income - Class B
(incl. contingent deferred sales charge) 17.35% 18.28%

Merrill Lynch High Yield Master Index 19.91% 20.36%

Fidelity Strategic Income Composite 19.82% n/a
Benchmark

Average General Bond Fund 18.02% 16.57%

CUMULATIVE TOTAL RETURNS show Class B's performance in percentage terms
over a set period - in this case, one year or since the fund started on
October 31, 1994. 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 those of the Merrill Lynch
High Yield Master Index - a broad measure of the high yield bond market, or
the Fidelity Strategic Income Composite Benchmark - a broad measure of the
world fixed income markets. To measure how Class B's performance stacked up
against its peers, you can compare it to the average general bond fund,
which reflects the performance of 64 funds with similar objectives tracked
by Lipper Analytical Services over the past 12 months. These benchmarks
include reinvested dividends and capital gains, if any, and exclude the
effects of sales charges. Recent U.S. Consumer Price Index (CPI)
information is not available from the U.S. Department of Labor. Therefore,
the CPI comparison has not been included in this report.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED DECEMBER 31, 1995 PAST 1 LIFE OF
YEAR FUND

Advisor Strategic Income - Class B 21.35% 17.93%

Advisor Strategic Income - Class B
(incl. contingent deferred sales charge) 17.35% 15.43%

Merrill Lynch High Yield Master Index 19.91% 17.16%

Fidelity Strategic Income Composite 19.82% n/a
Benchmark

Average General Bond Fund 18.02% 14.04%

AVERAGE ANNUAL TOTAL RETURNS take Class B shares' actual (or cumulative)
return and show you what would have happened if Class B shares had
performed at a constant rate each year.
$10,000 OVER LIFE OF FUND
FA Strat Inc Cl B (639) High Yield Master Fid Strat Inc Comp
10/31/94 10000.00 10000.00 10000.00
11/30/94 10045.19 9914.94 9921.26
12/31/94 9993.77 10025.22 9887.56
01/31/95 10109.93 10166.88 9962.57
02/28/95 10342.97 10484.10 10125.61
03/31/95 10496.27 10630.00 10301.07
04/30/95 10883.14 10878.89 10634.09
05/31/95 11285.68 11218.77 11037.19
06/30/95 11326.35 11304.46 11135.32
07/31/95 11420.96 11433.70 11192.91
08/31/95 11431.98 11503.09 11198.60
09/30/95 11617.60 11634.70 11390.44
10/31/95 11755.36 11717.17 11444.44
11/30/95 11878.64 11831.55 11595.55
12/31/95 11827.76 12021.46 11847.24

$10,000 OVER LIFE OF FUND(dagger): Let's say you invested $10,000 in
Fidelity Advisor Strategic Income Fund - Class B on October 31, 1994, when
the fund started, and paid the applicable contingent deferred sales charge
upon redemption at the end of the period. As the chart shows, by December
31, 1995, the value of your investment would have grown to $11,828 - an
18.28% increase on your initial investment. For comparison, look at how the
Merrill Lynch High Yield Master Index did over the same period. With
dividends reinvested, the same $10,000 investment would have grown to
$12,021 - a 20.21% increase. You also can look at how the Fidelity
Strategic Income Composite Benchmark, a hypothetical combination of
unmanaged indices that is more representative of the fund's investable
universe, did over the same period. This index combines returns from the JP
Morgan Emerging Markets Bond Index Plus (15%), Merrill Lynch High Yield
Master Index (40%), Salomon Brothers Mortgage Index (15%), Salomon Brothers
Treasury 1-10 Year Index (15%), and Salomon Brothers Non-U.S. Dollar World
Government Bond Index (15%). With distributions, if any, reinvested, a
$10,000 investment in the index would have grown to $11,847 - an 18.47%
increase.

Dividend return 7.78% 0.84%

Capital appreciation return 13.57% -0.90%

Total return 21.35% -0.06%

DIVIDEND returns and capital appreciation returns are both part of a class'
total return. A dividend return reflects the actual dividends paid by the
class. A capital appreciation return reflects both the amount paid by the
class to shareholders as capital gain distributions and changes in the
class' share price. Both returns assume the dividends or gains are
reinvested and exclude the effects of sales charges.
DIVIDENDS AND YIELD
PERIOD ENDED DECEMBER 31, 1995 PAST PAST 6 PAST 1
MONTH MONTHS YEAR

Dividends per share 9.05(cents) 38.38(cents) 72.65(cents)

Annualized dividend rate 9.58% 6.93% 6.81%

30-day annualized yield 6.85% - -

DIVIDENDS per share show the income paid by the class for a set period. If
you annualize this number based on an average share price of $11.12 over
the past month, $10.98 over the past six months, and $10.67 over the past
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all bond funds based on
the yields of the bonds in the fund, averaged over the past 30 days. This
figure shows you the yield characteristics of the fund's investments at the
end of the period. It also helps you to compare funds from different
companies on an equal basis. The offering share price used in the
calculation of the yield excludes the effect of Class B's contingent
deferred sales charge.
(dagger) THE DATA USED TO CREATE THE INDICES ON THE LINE GRAPH, ON PAGE 9,
IS FROM THE CLOSE OF BUSINESS ON OCTOBER 31, 1994. THE TOTAL RETURNS OF THE
TWO INDICES FOR THE LIFE OF FUND CALCULATIONS ON PAGE 8 ARE FROM THE
OPENING OF BUSINESS ON OCTOBER 31, 1994, COMMENCEMENT OF OPERATIONS OF THE
FUND. DATA FOR THE STRATEGIC INCOME COMPOSITE BENCHMARK IS ONLY AVAILABLE
AT THE CLOSE OF BUSINESS EACH MONTH.
FUND TALK: THE MANAGER'S OVERVIEW

NOTE TO SHAREHOLDERS: John Carlson became manager of the fund in October
1995. Beginning in January 1996, the fund's separate categories - U.S.
government and investment-grade securities, foreign developed market
securities, emerging market securities and high-yield securities - will be
managed by John and three additional managers under John's direction. The
following is an interview with John on the fund's overall performance and
strategy, and his thoughts on his particular category - emerging market
securities - as well as with Kevin Grant on U.S. government and
investment-grade securities, Margaret Eagle on high-yield securities and
Jonathan Kelly on foreign developed market securities.
Q. HOW DID THE FUND PERFORM, JOHN?
J.C. For the 12-month period ended December 31, 1995, the fund's Class A
and Class B shares returned 22.02% and 21.35%, respectively. For comparison
purposes, the average general bond fund, as tracked by Lipper Analytical
Services, returned 18.02% for the same period.
Q. WOULD YOU DESCRIBE WHAT THE FIXED-INCOME MARKETS WERE LIKE THIS PAST
YEAR?
J.C. Sure. Global bond markets benefited from slow economic growth, stable
interest rates and relatively low inflation pressures. This became
particularly evident when the central banks of the U.S., Germany and Great
Britain all lowered their respective short-term interest rates. In
particular, emerging markets enjoyed a nice springtime rally following the
announcement of a support package from the international community for
Argentina and Mexico. In the U.S., the high-yield corporate bond market was
the beneficiary of solid corporate earnings during 1995. By far, though,
the 30-year U.S. Treasury bond topped all major fixed income securities
with the exception of zero-coupon bonds. Long-term Treasuries were the
beneficiary of strong demand from yield-hungry Japanese investors.
Q. TURNING TO YOU, KEVIN, WHAT'S BEEN THE STORY IN THE U.S.?
K.G. Like John said, the Treasury market has been the real story. Nineteen
ninety-five was a great year for those who were patient enough to stick
with bonds. The yield curve - a graphical representation of bond yields at
various maturities - flattened during the year. This means that the market
believed the economy had slowed sufficiently and that inflation was not a
problem. Fixed-income investors fear inflation because of the corrosive
effects it has on bonds' income.
Q. SO HOW ARE YOU PUTTING TOGETHER YOUR PART OF THE FUND?
K.G. The fund has significant positions in Treasuries with maturities of
four and seven years and mortgage-backed securities. I've begun to add to
the fund's position in mortgage securities because of their income
advantage over Treasuries. In general, I will look at securities on a
relative value basis. In other words, I will try to take advantage of
securities that may be trading at cheap levels relative to others.
Additionally, investors should keep in mind that while current market
conditions may be positive, there is always the risk that economic
expectations may not play out as anticipated.
Q. HOW DID HIGH-YIELD CORPORATE BOND INVESTORS FARE IN 1995, MARGARET? WHAT
DO YOU SEE GOING FORWARD?
M.E. The high-yield bond market turned in a strong performance in 1995. In
general, the market was driven by investors' demand for a higher level of
income, good corporate earnings and declining interest rates. Looking
ahead, the current environment of slow economic growth and low inflation
should be positive for high-yield bonds. Rather than looking at broad
sectors or industries, I will use fundamental credit analysis to evaluate
opportunities in the high-yield market.
Q. BROADENING OUT A BIT, WHAT'S BEEN THE SITUATION IN THE MORE ESTABLISHED
FOREIGN MARKETS, JONATHAN?
J.K. As John touched on earlier, a general climate of slow growth and
relatively low inflation helped bond markets worldwide - particularly the
U.S. With the exception of Japan, interest rates trended downward in most
regions. Going forward, I will evaluate the global bond portion of the fund
relative to the opportunities of the entire global bond market as
represented by the Salomon Brothers Non-U.S. Dollar World Government Bond
Index. With the assistance of Fidelity's credit and quantitative research
staff in Boston and London, I also plan to evaluate securities on a
case-by-case basis in an effort to find attractively priced bonds for the
fund.
Q. WHAT OPPORTUNITIES DO YOU SEE IN THE FUTURE?
J.K. I'm cautiously optimistic. Economic fundamentals for fixed-income
investments are generally positive in most areas of the world.
Additionally, foreign markets appear undervalued when compared to the U.S.
As with any global portfolio, the performance of the dollar versus other
currencies will play an important role in performance.
Q. COMING BACK TO YOU, JOHN, WHAT AREAS OF THE EMERGING MARKETS HAVE YOU
TARGETED SINCE YOU BEGAN MANAGING THE FUND?
J.C. When I began managing in October, it had a significant cash position.
I put
that cash to work in Latin American corporate bonds. As investors
recognized the value of these bonds, they appreciated in value and their
spreads - the difference in yield compared to U.S. Treasury bonds -
tightened. I then sold these corporate bonds and bought Brady bonds.
Country rotation from Brazil to Argentina to Mexico became the theme for
the rest of the year.
Q. WHAT ARE YOU LOOKING FOR IN THE FUTURE?
J.C. I am optimistic about emerging market debt. Stable interest rates in
the developed world coupled with tight fiscal and monetary policies in
emerging countries may attract more capital. However, I will continue to
monitor the economies, politics and interest rates that can radically
effect the emerging markets.
Q. WHAT IS YOUR GENERAL OUTLOOK FOR THE VARIOUS BOND MARKETS?
J.C. Although most of the world's bond markets had a great 1995, investors
can not expect the same level of price appreciation from most fixed-income
investments in 1996. Additionally, knowing the unpredictability of interest
rates, foreign economies and politics, we will continue to watch global
markets for any radical changes affecting the fund's holdings.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGERS
ONLY
THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER. THE
MANAGERS' VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND OTHER
CONDITIONS.

TOP FIVE HOLDINGS AS OF DECEMBER 31, 1995
(BY ISSUER WITH MATURITIES OF % OF FUND'S % OF FUND'S
MORE THAN ONE YEAR) INVESTMENTS INVESTMENTS
6 MONTHS AGO

U.S. Government (various issues) 27.4 24.8

Brazil Federative Republic 3.8 4.6
(various issues)

Argentina Republic (various 3.3 3.3
issues)

French Government (various 3.1 1.3
issues)

Acetex Corp. 9 3/4%, 10/1/03 2.1 0.0

TOP FIVE SECTORS AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE SECTORS
6 MONTHS AGO

Media & Leisure 8.8 7.1

Basic Industries 6.5 7.9

Utilities 4.6 1.7

Retail & Wholesale 3.6 3.5

Nondurables 3.4 1.6

QUALITY DIVERSIFICATION AS OF DECEMBER 31, 1995
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

Aaa, Aa, A 39.0 37.5

Baa 0.3 0.2

Ba 6.4 7.8

B 31.2 30.8

Caa, Ca, C 2.9 0.1

Nonrated 9.6 12.2

Showing Percentage of Total Value of Investments in Securities

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
DECEMBER 31, 1995

ASSETS

Investment in securities, at value (including repurchase $ 80,414,114
agreements of $4,949,000) (cost $77,412,363) -
See accompanying schedule

Cash 775,731

Receivable for investments sold 108,416

Dividends receivable 23,288

Interest receivable 1,352,481

Prepaid expenses 9,127

TOTAL ASSETS 82,683,157

LIABILITIES

Payable for investments purchased $ 932,349
Regular delivery

Delayed delivery 1,975,042

Distributions payable 241,417

Accrued management fee 26,878

Distribution fees payable 32,093

Other payables and accrued expenses 87,827

TOTAL LIABILITIES 3,295,606

NET ASSETS $ 79,387,551

Net Assets consist of: $ 75,821,112
Paid in capital

Undistributed net investment income 33,845

Accumulated undistributed net realized gain (loss) on 530,954
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 3,001,640
investments and assets and liabilities in foreign
currencies

NET ASSETS $ 79,387,551

CALCULATION OF MAXIMUM OFFERING PRICE $11.00
CLASS A:
NET ASSET VALUE, and redemption price per share
($52,626,017 (divided by) 4,782,675 shares)

Maximum offering price per share (100/95.25 of $11.00) $11.55

CLASS B: $11.01
NET ASSET VALUE, offering price and redemption price per

share ($26,654,100 (divided by) 2,420,771 shares) A

INSTITUTIONAL CLASS: $11.03
NET ASSET VALUE, offering price and redemption price per

share ($107,434 (divided by) 9,740 shares)

</TABLE>

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

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED DECEMBER 31, 1995

INVESTMENT INCOME $ 98,226
Dividends

Interest 3,906,748

TOTAL INCOME 4,004,974

EXPENSES

Management fee $ 277,990

Transfer agent fees 67,377
Class A

Class B 37,484

Institutional Class 443

Distribution fees 68,959
Class A

Class B 186,313

Accounting fees and expenses 45,067

Non-interested trustees' compensation 161

Custodian fees and expenses 15,450

Registration fees 58,085
Class A

Class B 52,103

Institutional Class 14,413

Audit 34,970

Legal 2,239

Reports to shareholders 535

Miscellaneous 361

Total expenses before reductions 861,950

Expense reductions (95,753) 766,197

NET INVESTMENT INCOME 3,238,777

REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:

Investment securities 2,578,567

Foreign currency transactions (56,757) 2,521,810

Change in net unrealized appreciation (depreciation) on:

Investment securities 2,993,350

Assets and liabilities in foreign currencies 9,110 3,002,460

NET GAIN (LOSS) 5,524,270

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 8,763,047
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1994
DECEMBER 31, (COMMENCEMENT
1995 OF OPERATIONS) TO
DECEMBER 31,
1994

INCREASE (DECREASE) IN NET ASSETS

Operations $ 3,238,777 $ 93,779
Net investment income

Net realized gain (loss) 2,521,810 (166,394)

Change in net unrealized appreciation (depreciation) 3,002,460 (820)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 8,763,047 (73,435)
FROM OPERATIONS

Distributions to shareholders
From net investment income

Class A (2,143,447) (53,334)

Class B (1,275,191) (45,552)

Institutional Class (3,950) -

From net realized gain (1,060,007) -
Class A

Class B (539,517) -

Institutional Class (2,175) -

TOTAL DISTRIBUTIONS (5,024,287) (98,886)

Share transactions - net increase (decrease) 55,582,973 20,238,139

TOTAL INCREASE (DECREASE) IN NET ASSETS 59,321,733 20,065,818

NET ASSETS

Beginning of period 20,065,818 -

End of period (including under (over) distribution $ 79,387,551 $ 20,065,818
of net investment income of $33,845 and
$(163,199), respectively)

</TABLE>

FINANCIAL HIGHLIGHTS - CLASS A
YEARS ENDED DECEMBER 31,

1995 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 9.920 $ 10.000

Income from Investment Operations

Net investment income .885 .064 E

Net realized and unrealized gain (loss) 1.231 (.046)

Total from investment operations 2.116 .018

Less Distributions

From net investment income (.806) (.098)

From net realized gain (.230) -

Total distributions (1.036) (.098)

Net asset value, end of period $ 11.000 $ 9.920

TOTAL RETURN B, C 22.02% .17%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 52,626 $ 10,687

Ratio of expenses to average net assets 1.35% F 1.35% A,
F

Ratio of net investment income to average net assets 7.28% 5.80% A

Portfolio turnover 193% 104% A

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
D FOR THE PERIOD OCTOBER 31, 1994 (COMMENCEMENT OF SALE OF CLASS A SHARES)
TO DECEMBER 31, 1994.
E NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
F FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSES WOULD
HAVE BEEN HIGHER.
FINANCIAL HIGHLIGHTS - CLASS B

<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED DECEMBER
31,

1995 1994 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 9.910 $ 10.000

Income from Investment Operations

Net investment income .820 .072 E

Net realized and unrealized gain (loss) 1.237 (.078)

Total from investment operations 2.057 (.006)

Less Distributions

From net investment income (.727) (.084)

From net realized gain (.230) -

Total distributions (.957) (.084)

Net asset value, end of period $ 11.010 $ 9.910

TOTAL RETURN B, C 21.35% (.06)%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 26,654 $ 9,379

Ratio of expenses to average net assets 2.10% F 2.10% A
, F

Ratio of net investment income to average net assets 6.53% 5.06% A

Portfolio turnover 193% 104% A

</TABLE>

A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
D FOR THE PERIOD OCTOBER 31, 1994 (COMMENCEMENT OF SALE OF CLASS B SHARES)
TO DECEMBER 31, 1994.
E NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
F FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSES WOULD
HAVE BEEN HIGHER.
FINANCIAL HIGHLIGHTS - INSTITUTIONAL CLASS
YEAR ENDED
DECEMBER 31,

1995 D

SELECTED PER-SHARE DATA

Net asset value, beginning of period $ 10.890

Income from Investment Operations

Net investment income .456

Net realized and unrealized gain (loss) .340

Total from investment operations .796

Less Distributions

From net investment income (.426)

From net realized gain (.230)

Total distributions (.656)

Net asset value, end of period $ 11.030

TOTAL RETURN B, C 7.47%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of period (000 omitted) $ 107

Ratio of expenses to average net assets 1.10% A,
E

Ratio of net investment income to average net assets 7.53% A

Portfolio turnover 193%

A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN.
D FOR THE PERIOD JULY 3, 1995 (COMMENCEMENT OF SALE OF INSTITUTIONAL CLASS
SHARES) TO DECEMBER 31, 1995.
E FMR VOLUNTARILY AGREED TO REIMBURSE A PORTION OF THE CLASS' EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS' EXPENSES WOULD
HAVE BEEN HIGHER.
NOTES TO FINANCIAL STATEMENTS
For the period ended December 31, 1995

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research
(U.K.) Inc., London, England
Fidelity Management & Research
(Far East) Inc., Tokyo, Japan
Fidelity Investments Japan Limited,
Tokyo, Japan
Fidelity International Investment Advisors,
Pembroke, Bermuda
Fidelity International Investment Advisors (U.K.) Limited, London, England
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Robert A. Lawrence, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Marvin L. Mann *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
State Street Bank and Trust Company
Boston, MA - Class A
Fidelity Investments Institutional
Operations Company
Boston, MA - Class B
CUSTODIAN
Bank of New York
New York, NY
GROWTH FUNDS
Fidelity Advisor Overseas Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Global Resources Fund
Fidelity Advisor Growth
Opportunities Fund
Fidelity Advisor Strategic
Opportunities Fund
GROWTH AND INCOME FUNDS
Fidelity Advisor Equity Income Fund
Fidelity Advisor Income & Growth Fund
TAXABLE INCOME FUNDS
Fidelity Advisor Emerging Markets
Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Strategic Income Fund
Fidelity Advisor Government
Investment Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Short Fixed-Income Fund
MUNICIPAL FUNDS
Fidelity Advisor High Income
Municipal Fund
Fidelity Advisor Intermediate Municipal Income Fund
Fidelity Advisor Short-Intermediate Municipal Income Fund
STATE MUNICIPAL FUNDS
Fidelity Advisor New York Municipal Income Fund
MONEY MARKET FUNDS
Daily Money Fund: Money Market Portfolio
Daily Money Fund: U.S. Treasury Portfolio
Daily Tax-Exempt Money Fund
(REGISTERED TRADEMARK)
(registered trademark)
* INDEPENDENT TRUSTEES