SUPPLEMENT TO
FIDELITY MORTGAGE SECURITIES FUND'S
SEPTEMBER 20, 1996 PROSPECTUS
At a recent meeting, the Board of Trustees voted to allow Fidelity Mortgage
Securities Fund to create additional classes of shares that will be sold
primarily through financial intermediary distribution channels. The current
single existing class of shares of the fund, which will become known as the
"Initial Class," will be closed to new accounts effective on or about
February 28, 1997. Initial Class shareholders on or prior to that date,
including participants in an employee benefit plan which offered the fund
on or prior to that date (except participants in an employee benefit plan
for which an affiliate of FMR maintains the accounts at the participant
level other than pursuant to a recordkeeping agreement), will continue to
be able to purchase Initial Class shares of the fund.
The following information replaces similar information found in "How to Buy
Shares" on page 18.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $2,500
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $500
TO ADD TO AN ACCOUNT $250
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $250
Through regular investment plans* $100
MINIMUM BALANCE $2,000
For Fidelity IRA, Rollover IRA, SEP-IRA
and Keogh accounts $500
* FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO
"INVESTOR SERVICES", PAGE 23.
These minimums may vary for investments through Fidelity Portfolio Advisory
Services. There is no minimum account balance or initial or subsequent
investment minimums for certain retirement accounts funded through salary
reduction, or accounts opened with the proceeds of distributions from such
Fidelity retirement accounts. Refer to the program materials for details.
The following information replaces similar information found in "How to
Sell Shares" on page 20.
IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR SHARES, leave at least $2,000
worth of shares in the account to keep it open ($500 for retirement
accounts).
The following information replaces similar information found in
"Transaction Details" on page 27.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of $12.00
from accounts with a value of less than $2,500, subject to an annual
maximum charge of $24.00 per shareholder. It is expected that accounts will
be valued on the second Friday in November of each year. Accounts opened
after September 30 will not be subject to the fee for that year. The fee,
which is payable to the transfer agent, is designed to offset in part the
relatively higher costs of servicing smaller accounts. This fee will not be
deducted from Fidelity brokerage accounts, retirement accounts (except
non-prototype retirement accounts), accounts using regular investment
plans, or if total assets in Fidelity exceed $30,000. Eligibility for the
$30,000 waiver is determined by aggregating Fidelity accounts maintained by
FSC or FBSI which are registered under the same social security number or
which list the same social security number for the custodian of Uniform
Gifts/Transfers to Minors Act account.
IF YOUR ACCOUNT BALANCE FALLS BELOW $2,000, you will be given 30 days'
notice to reestablish the minimum balance. If you do not increase your
balance, Fidelity reserves the right to close your account and send the
proceeds to you. Your shares will be redeemed at the NAV on the day your
account is closed.
The following information replaces similar information found in "FMR and
Affiliates" in the "Charter" section on page 9.
Kevin Grant is Vice President and co-manager of Mortgage Securities Fund,
which he has managed since July 1993. He also manages several other
Fidelity funds. Prior to joining Fidelity in 1993, Mr. Grant was a vice
president and chief mortgage strategist at Morgan Stanley for three years.
Thomas Silvia is co-manager of Mortgage Securities Fund, which he has
managed since February 1997. Mr. Silvia joined Fidelity as a senior
mortgage trader in 1993. Previously, he was a quantitative analyst with
Donaldson, Lufkin & Jenrette in New York from 1990 to 1993.
