FIDELITY SECURITIES FUND, N-30D, 1997-03-19

FIDELITY SECURITIES FUND
N-30D, 1997-03-19

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FIDELITY

(REGISTERED TRADEMARK)
BLUE CHIP GROWTH
FUND
SEMIANNUAL REPORT
JANUARY 31, 1997
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
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 20 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 24 Notes to the financial statements.

To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.

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 FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND MONEY.
PRESIDENT'S MESSAGE

(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
As 1997 begins, the stock and bond markets generally have continued on the
course they followed during the past year. Through January, stocks
maintained their unprecedented climb, with the large companies still
setting the pace. With low, stable interest rates, the bond market has
tended to mirror its historical returns in the mid-single digits.
While it's impossible to predict the future direction of the markets with
any degree of certainty, there are certain basic principles that can help
investors plan for their future needs.
First, investors are encouraged to take a long-term view of their
portfolios. If you can afford to leave your money invested through the
inevitable up and down cycles of the financial markets, you will greatly
reduce your vulnerability to any single decline. We know from experience,
for example, that stock prices have gone up over longer periods of time,
have significantly outperformed other types of investments and have stayed
ahead of inflation.
Second, you can further manage your investing risk through diversification.
A stock mutual fund, for instance, is already diversified, because it
invests in many different companies. You can increase your diversification
further by investing in a number of different stock funds, or in such other
investment categories 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, it's important to
remember that there is no assurance that a money market fund will achieve
its goal of maintaining a stable net asset value of $1.00 per share, and
that these types of funds are neither insured nor guaranteed by any agency
of the U.S. government.
Finally, no matter what your time horizon or portfolio diversity, it makes
good sense to follow a regular investment plan, investing a certain amount
of money in a fund at the same time each month or quarter and periodically
reviewing your overall portfolio. By doing so, you won't get caught up in
the excitement of a rapidly rising market, nor will you buy all your shares
at market highs. While this strategy - known as dollar cost averaging -
won't assure a profit or protect you from a loss in a declining market, it
should help you lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are available
24 hours a day, seven days a week to provide you the information you need
to make the investments that are right for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Total return
reflects the change in the value of an investment, assuming reinvestment of
the fund's dividend income and capital gains (the profits earned upon the
sale of securities that have grown in value).
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1997 PAST 6 PAST 1 PAST 5 LIFE OF
MONTHS YEAR YEARS FUND

Fidelity Blue Chip Growth 22.12% 20.44% 134.97% 426.13%

Fidelity Blue Chip Growth 18.46% 16.83% 127.92% 410.34%
(incl. 3% sales charge)

S&P 500(registered trademark) 24.15% 26.34% 119.87% 317.60%

Growth Funds Average 20.94% 22.74% 95.27% n/a

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years, or
since the fund started on December 31, 1987. 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 the fund's return to the
performance of the Standard & Poor's 500 Index - a widely recognized,
unmanaged index of common stocks. To measure how the fund's performance
stacked up against its peers, you can compare it to the growth funds
average, which reflects the performance of 761 mutual funds with similar
objectives tracked by Lipper Analytical Services, Inc. over the past six
months. These benchmarks reflect reinvestment of dividends and capital
gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1997 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND

Fidelity Blue Chip Growth 20.44% 18.63% 20.03%

Fidelity Blue Chip Growth 16.83% 17.91% 19.62%
(incl. 3% sales charge)

S&P 500 26.34% 17.06% 17.02%

Growth Funds Average 22.74% 14.04% n/a

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking an arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19970131 19970212 090220 S00000000000001
Blue Chip Growth SP Standard & Poor 500
00312 SP001
1987/12/31 9700.00 10000.00
1988/01/31 9767.90 10389.22
1988/02/29 10185.00 10873.35
1988/03/31 9816.40 10537.37
1988/04/30 9797.00 10654.33
1988/05/31 9797.00 10747.03
1988/06/30 10359.60 11240.31
1988/07/31 10155.90 11197.60
1988/08/31 9729.10 10816.88
1988/09/30 10165.60 11277.68
1988/10/31 10146.20 11591.20
1988/11/30 9961.90 11425.45
1988/12/31 10272.95 11625.39
1989/01/31 11031.75 12476.37
1989/02/28 10700.99 12165.71
1989/03/31 10953.92 12449.17
1989/04/30 11702.99 13095.28
1989/05/31 12461.79 13625.64
1989/06/30 12024.02 13547.98
1989/07/31 13191.40 14771.36
1989/08/31 13512.43 15060.88
1989/09/30 13846.77 14999.13
1989/10/31 13640.69 14651.15
1989/11/30 13876.21 14950.03
1989/12/31 13995.40 15308.83
1990/01/31 12823.32 14281.61
1990/02/28 13170.98 14465.84
1990/03/31 13826.54 14849.19
1990/04/30 13697.42 14477.96
1990/05/31 15246.94 15889.56
1990/06/30 15594.59 15781.51
1990/07/31 15227.08 15731.01
1990/08/31 13915.94 14308.92
1990/09/30 13258.58 13612.08
1990/10/31 13178.88 13553.55
1990/11/30 14015.64 14429.11
1990/12/31 14485.44 14831.68
1991/01/31 15619.78 15478.34
1991/02/28 16824.39 16585.04
1991/03/31 17667.62 16986.40
1991/04/30 17476.89 17027.17
1991/05/31 18400.43 17762.74
1991/06/30 17476.89 16949.21
1991/07/31 19012.77 17739.04
1991/08/31 19845.96 18159.45
1991/09/30 19534.98 17856.19
1991/10/31 19926.88 18095.46
1991/11/30 19504.83 17366.22
1991/12/31 22424.76 19352.91
1992/01/31 21719.26 18992.95
1992/02/29 21820.04 19239.86
1992/03/31 21225.41 18864.68
1992/04/30 21507.61 19419.30
1992/05/31 21951.06 19514.46
1992/06/30 21316.12 19223.69
1992/07/31 22192.95 20009.94
1992/08/31 21961.14 19599.74
1992/09/30 22252.76 19831.01
1992/10/31 22561.69 19900.42
1992/11/30 23745.89 20579.03
1992/12/31 23808.73 20832.15
1993/01/31 23860.87 21007.14
1993/02/28 23704.44 21292.83
1993/03/31 24851.60 21742.11
1993/04/30 25247.89 21215.95
1993/05/31 26572.33 21784.54
1993/06/30 26822.62 21847.72
1993/07/31 26822.62 21760.33
1993/08/31 28491.21 22585.04
1993/09/30 29084.11 22411.14
1993/10/31 29409.21 22875.05
1993/11/30 28515.20 22657.74
1993/12/31 29642.54 22931.89
1994/01/31 30819.90 23711.58
1994/02/28 30844.43 23068.99
1994/03/31 29875.56 22063.19
1994/04/30 30758.58 22345.60
1994/05/31 31151.04 22712.06
1994/06/30 30071.79 22155.62
1994/07/31 30832.17 22882.32
1994/08/31 32500.10 23820.50
1994/09/30 32403.56 23236.89
1994/10/31 33899.49 23759.73
1994/11/30 32131.58 22894.40
1994/12/31 32562.32 23233.92
1995/01/31 31746.69 23836.38
1995/02/28 32800.73 24765.28
1995/03/31 34181.02 25496.10
1995/04/30 35448.38 26246.96
1995/05/31 36238.91 27296.05
1995/06/30 38246.61 27930.14
1995/07/31 40894.26 28856.30
1995/08/31 41320.89 28928.73
1995/09/30 41775.91 30149.53
1995/10/31 40723.95 30041.89
1995/11/30 42130.94 31360.73
1995/12/31 41802.28 31964.74
1996/01/31 42372.87 33052.82
1996/02/29 42033.23 33359.22
1996/03/31 42549.48 33680.47
1996/04/30 42780.43 34176.92
1996/05/31 43649.89 35058.34
1996/06/30 43785.75 35191.91
1996/07/31 41788.69 33637.13
1996/08/31 42875.53 34346.54
1996/09/30 45437.41 36279.56
1996/10/31 46114.04 37280.16
1996/11/30 49453.08 40098.16
1996/12/31 48231.04 39303.82
1997/01/31 51019.56 41759.52
IMATRL PRASUN SHR__CHT 19970131 19970212 090223 R00000000000112

$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Blue Chip Growth Fund on December 31, 1987, when the
fund started, and the current maximum 3% sales charge was paid. As the
chart shows, by January 31, 1997, the value of the investment would have
grown to $51,034 - a 410.34% increase on the initial investment. For
comparison, look at how the S&P 500 did over the same period. With
dividends and capital gains, if any, reinvested, the same $10,000
investment would have grown to $41,760 - a 317.60% 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

An interview with John McDowell, Portfolio Manager of Fidelity Blue Chip
Growth Fund
Q. HOW DID THE FUND PERFORM, JOHN?
A. For the six months that ended January 31, 1997, the fund provided a
total return of 22.12%. For a sense of how the fund fared relative to its
peer group, the growth funds average had a six-month return of 20.94%,
according to Lipper Analytical Services. The Standard & Poor's 500 Index
had a return of 24.15% over the same time period. For the 12 months that
ended January 31, 1997, the fund had a return of 20.44%, while the Lipper
group and the S&P 500 had returns of 22.74% and 26.34%, respectively.
Q. CAN YOU POINT TO ANY SPECIFIC MARKET FACTORS THAT INFLUENCED THE FUND'S
PERFORMANCE?
A. Over the past six months, the three best-performing S&P 500 sectors were
health care, technology and finance. Fortunately, the fund was
well-positioned in these three areas. Many health care companies are
benefiting from the successful introductions of new pharmaceutical
products, and this is leading to strong corporate earnings growth.
Technology stocks rebounded in the second half of the year. A sharp
sell-off in the first half of 1996 resulted in attractive valuations for
most technology stocks. As personal computer sales continued to post
healthy gains in the second half, technology stock valuations improved.
While I did add to my technology positions during the summer, given benefit
of 20/20 hindsight, I should have bought even more. Financial stocks,
particularly money center banks and insurance stocks, benefited from a
benign interest rate environment and strong relative earnings growth
compared with the typical S&P 500 company.
Q. LARGE-CAPITALIZATION STOCKS - THOSE OF MORE ESTABLISHED, HOUSEHOLD-NAME
COMPANIES - RALLIED THROUGHOUT THE PERIOD. WHY DO YOU THINK LARGE CAPS DID
WELL, AND HOW DID THIS RALLY AFFECT THE FUND?
A. A relatively small group of very large stocks, including Intel, Merck
and Microsoft, posted unusually strong price gains over the past six
months. Over time, stock price performance tends to correlate well with
corporate earnings growth; however, over the past six months, stock price
appreciation has generally been well in excess of earnings gains,
particularly among many of the very largest companies in the S&P 500. Since
stock gains for these companies were not matched by earnings gains over
this period, and since stock valuations were high to begin with, it appears
that there is some measure of investor speculation in these stocks. Because
of these high valuations, we reduced certain positions in the fund.
Q. HAVE YOU BEEN SURPRISED BY THE STOCK MARKET'S BEHAVIOR?
A. Given the moderate growth in corporate earnings in 1996 and the overall
mediocre performance of the bond market, it is surprising that stocks have
performed so well. The market appears to be anticipating strong earnings
gains and/or significantly lower interest rates over the next couple of
years. Additionally, the dollar has been very strong recently. Typically,
dollar strength is correlated to stock weakness among U.S.-based
multinational corporations, which generate a significant proportion of
their earnings overseas. Many multinationals have been among the market's
best performers over the past year.
Q. THE MERGER AND ACQUISITION ACTIVITY AMONG CORPORATIONS SEEMED BUSY . . .
A. The economic climate and healthy equity market combined for good merger
and acquisition conditions. Companies were making acquisitions and using
their richly valued stocks as currency. Since the market considers these
deals to be generally profitable to the acquiring company, that company's
stock price tends to increase.
Q. WHICH INDIVIDUAL STOCKS CONTRIBUTED POSITIVELY TO THE FUND'S
PERFORMANCE? WERE THERE ANY DISAPPOINTMENTS?
A. Within the technology sector, the fund benefited from positions in
Linear Technology, Adaptec, Compaq Computer and IBM. Electronic Data
Systems was a disappointment from an earnings perspective. In the finance
sector, Allstate, Freddie Mac and American Express were strong performers.
Health care stocks - particularly pharmaceuticals such as Merck and
Bristol-Myers - also performed well. Toys "R" Us and Frontier Corp. were a
drag on fund performance because of disappointing earnings growth. There
were also numerous examples - Microsoft and Intel, to name two - of
companies that posted strong earnings gains and where it would have helped
to own more in the fund.
Q. WHAT IS YOUR OUTLOOK?
A. Stock prices have risen sharply over the past two years or so, much
faster than underlying earnings growth. Consequently, stock valuations are
on the high side. While I cannot identify specific factors which might lead
to a significant market correction in the near term, current high stock
valuations appear to depend on an acceleration in earnings growth and
continuing modest inflation. Fortunately, my investment style does not
depend on forecasting changes in the economy or changes in interest rates,
but rather on the success of the individual companies in the fund. I will
continue to balance the near-term growth prospects of these companies with
the risks inherent in their market valuations, selling the most expensive
stocks and buying companies expected to show the best improvement in
earnings growth.
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: to increase the value
of the fund's shares by
investing mainly in common
stocks of well-known and
established companies
FUND NUMBER: 312
TRADING SYMBOL: FBGRX
START DATE: December 31,
1987
SIZE: as of January 31,
1997, more than $10.1 billion
MANAGER: John McDowell,
since 1996; leader, Fidelity
Growth Funds Group;
manager, Fidelity
Management Trust
Company; manager, Fidelity
Large Cap Stock Fund, 1995
to 1996; joined Fidelity in
1985
(checkmark)
JOHN MCDOWELL ON HOW THE
STOCK MARKET RALLY HAS
AFFECTED THE CORPORATE
MINDSET:
"The combination of a
moderately growing economy
and a strong equity market
made for a favorable period
from a corporate finance
standpoint. There were a
couple of forces at work. First,
there was a record amount of
money invested in mutual
funds by individual investors
in 1996. Second, it was a
record period for initial public
offerings (IPOs) and
corporate financing activity in
general. In fact, I believe IPOs
- - when a private company
decides to raise capital by
selling its shares to the public
- - increased by about 50%
from the previous year. The
reason behind the
acceleration in IPOs can be
traced to investors' demand for
more stock. In this type of bull
market environment,
corporations tend to feel more
comfortable that their stock
offerings will be successful
and are incentivized by their
ability to attract relatively high
stock valuations. In addition
to high levels of IPO activity,
we also saw plenty of mergers
and acquisitions activity.
These are typical
developments in a bull
market such as we've seen."
INVESTMENT CHANGES

TOP TEN STOCKS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

General Electric Co. 2.8 2.6

Philip Morris Companies, Inc. 2.4 2.6

International Business Machines Corp. 2.2 1.5

Merck & Co., Inc. 2.0 1.4

Intel Corp. 1.9 1.0

Federal National Mortgage Association 1.4 1.5

Bristol-Myers Squibb Co. 1.4 1.0

Cisco Systems, Inc. 1.3 1.1

Procter & Gamble Co. 1.3 0.8

Allstate Corp. 1.2 0.9

TOP FIVE MARKET SECTORS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET
SECTORS
6 MONTHS AGO

Technology 18.9 14.6

Health 14.4 13.8

Finance 11.8 11.5

Nondurables 10.1 9.6

Energy 7.8 7.8

ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JANUARY 31, 1997 * AS OF JULY 31, 1996 **
Row: 1, Col: 1, Value: 5.3
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 50.0
Row: 1, Col: 4, Value: 44.7
Row: 1, Col: 1, Value: 8.4
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 0.0
Row: 1, Col: 4, Value: 41.6
Row: 1, Col: 5, Value: 50.0
Stocks 94.7%
Short-term
investments 5.3%

FOREIGN
INVESTMENTS 3.0%
Stocks 91.6%
Short-term
investments 8.4%

FOREIGN
INVESTMENTS 2.9%
*
*
*

INVESTMENTS JANUARY 31, 1997 (UNAUDITED)

Showing Percentage of Total Value of Investment in Securities

COMMON STOCKS - 94.7%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 2.0%
AEROSPACE & DEFENSE - 1.8%
Boeing Co. 923,600 $ 98,941
Lockheed Martin Corp. 506,300 46,580
Precision Castparts Corp. 655,300 33,584
179,105
SHIP BUILDING & REPAIR - 0.2%
General Dynamics Corp. 329,900 23,299
TOTAL AEROSPACE & DEFENSE 202,404
BASIC INDUSTRIES - 3.8%
CHEMICALS & PLASTICS - 2.7%
Air Products & Chemicals, Inc. 712,600 50,862
du Pont (E.I.) de Nemours & Co. 530,500 58,156
Hanna (M.A.) Co. 360,100 7,742
Monsanto Co. 1,839,800 69,683
Praxair, Inc. 1,147,000 53,192
Sealed Air Corp. (a) 391,700 16,745
Union Carbide Corp. 516,900 23,454
279,834
PACKAGING & CONTAINERS - 0.3%
Owens-Illinois, Inc. (a) 1,315,400 31,241
PAPER & FOREST PRODUCTS - 0.8%
Kimberly-Clark Corp. 796,700 77,678
TOTAL BASIC INDUSTRIES 388,753
CONGLOMERATES - 0.9%
AlliedSignal, Inc. 1,048,300 73,643
Tyco International Ltd. 347,500 19,851
93,494
CONSTRUCTION & REAL ESTATE - 0.6%
BUILDING MATERIALS - 0.5%
Sherwin-Williams Co. 864,100 47,958
CONSTRUCTION - 0.1%
Lennar Corp. 451,100 12,010
TOTAL CONSTRUCTION & REAL ESTATE 59,968
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
DURABLES - 1.7%
AUTOS, TIRES, & ACCESSORIES - 0.5%
AutoZone, Inc. (a) 967,400 $ 20,920
Snap-on Tools Corp. 828,550 30,864
51,784
CONSUMER ELECTRONICS - 0.3%
Newell Co. 1,056,100 34,851
HOME FURNISHINGS - 0.5%
Leggett & Platt, Inc. 1,524,300 48,968
TEXTILES & APPAREL - 0.4%
NIKE, Inc. Class B 535,600 36,354
TOTAL DURABLES 171,957
ENERGY - 7.8%
ENERGY SERVICES - 2.3%
Baker Hughes, Inc. 377,600 14,726
ENSCO International, Inc. (a) 618,700 34,106
Halliburton Co. 1,391,400 100,703
Schlumberger Ltd. 728,900 80,999
230,534
OIL & GAS - 5.5%
Amoco Corp. 487,000 42,369
Anadarko Petroleum Corp. 713,000 46,167
Atlantic Richfield Co. 224,600 29,703
British Petroleum PLC:
Ord. 3,235,602 38,098
ADR 560,987 79,450
Burlington Resources, Inc. 1,103,800 54,914
Enron Oil & Gas Co. 870,300 20,017
Occidental Petroleum Corp. 860,100 21,932
Phillips Petroleum Co. 930,800 41,072
Royal Dutch Petroleum Co.:
Ord. 345,200 60,400
ADR 299,400 51,946
Union Pacific Resources Group, Inc. 804,900 22,839
Unocal Corp. 1,163,674 49,020
557,927
TOTAL ENERGY 788,461
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - 11.8%
BANKS - 3.2%
Bank of New York Co., Inc. 1,379,200 $ 50,513
BankAmerica Corp. 648,800 72,422
Citicorp 771,000 89,725
NationsBank Corp. 1,052,900 113,713
326,373
CREDIT & OTHER FINANCE - 1.7%
American Express Co. 1,850,943 115,453
Household International, Inc. 584,808 57,969
173,422
FEDERAL SPONSORED CREDIT - 2.5%
Federal Home Loan Mortgage Corporation 3,519,600 106,468
Federal National Mortgage Association 3,664,000 144,728
251,196
INSURANCE - 4.0%
Aetna, Inc. 784,450 61,972
Allstate Corp. 1,780,000 117,035
American International Group, Inc. 568,600 68,872
MBIA, Inc. 576,050 55,373
Old Republic International Corp. 861,300 23,147
Provident Companies, Inc. 587,200 28,846
UNUM Corp. 622,000 47,039
402,284
SECURITIES INDUSTRY - 0.4%
Merrill Lynch & Co., Inc. 528,100 44,492
TOTAL FINANCE 1,197,767
HEALTH - 14.4%
DRUGS & PHARMACEUTICALS - 7.5%
American Home Products Corp. 1,672,300 105,982
Bristol-Myers Squibb Co. 1,088,400 138,227
Genentech, Inc. special (a) 408,500 22,416
Lilly (Eli) & Co. 609,700 53,120
Merck & Co., Inc. 2,223,400 201,774
Pfizer, Inc. 925,500 85,956
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
DRUGS & PHARMACEUTICALS - CONTINUED
Schering-Plough Corp. 936,900 $ 70,853
SmithKline Beecham PLC ADR 555,000 40,099
Warner-Lambert Co. 570,200 45,901
764,328
MEDICAL EQUIPMENT & SUPPLIES - 3.6%
Baxter International, Inc. 1,229,900 56,729
Becton, Dickinson & Co. 1,317,600 64,892
Bergen Brunswig Corp. Class A 511,700 15,223
Boston Scientific Corp. (a) 358,600 24,474
Cardinal Health, Inc. 367,550 23,018
Johnson & Johnson 1,558,500 89,809
Medtronic, Inc. 608,800 41,703
Pall Corp. 1,006,100 22,511
St. Jude Medical, Inc. (a) 791,200 29,967
368,326
MEDICAL FACILITIES MANAGEMENT - 3.3%
Columbia/HCA Healthcare Corp. 2,587,900 102,222
HEALTHSOUTH Rehabilitation Corp. 723,100 31,545
Health Management Associates, Inc. Class A (a) 1,274,200 35,200
Health Care & Retirement Corp. (a) 991,050 25,643
Oxford Health Plans, Inc. (a) 618,000 33,604
PacifiCare Health Systems, Inc. Class B (a) 591,900 47,648
Tenet Healthcare Corp. (a) 2,208,300 59,624
335,486
TOTAL HEALTH 1,468,140
INDUSTRIAL MACHINERY & EQUIPMENT - 5.6%
ELECTRICAL EQUIPMENT - 3.4%
Alcatel Alsthom Compagnie Generale d'Electricite SA 166,700 16,601
Emerson Electric Co. 420,000 41,475
General Electric Co. 2,743,000 282,529
340,605
INDUSTRIAL MACHINERY & EQUIPMENT - 1.8%
Case Corp. 520,500 27,586
Caterpillar, Inc. 745,690 57,884
Ingersoll-Rand Co. 744,000 33,945
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
Stanley Works 1,735,700 $ 65,957
Timken Co. 294 15
185,387
POLLUTION CONTROL - 0.4%
Browning-Ferris Industries, Inc. 1,276,200 41,477
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 567,469
MEDIA & LEISURE - 4.3%
ENTERTAINMENT - 0.7%
Disney (Walt) Co. 885,600 64,870
LODGING & GAMING - 2.3%
HFS, Inc. (a) 1,198,490 83,894
Hilton Hotels Corp. 993,300 28,309
ITT Corp. (a) 785,800 44,889
Marriott International, Inc. 658,830 35,000
Mirage Resorts, Inc. (a) 1,765,600 44,361
236,453
PUBLISHING - 0.9%
Knight-Ridder, Inc. 959,800 36,832
New York Times Co. (The) Class A 671,000 25,750
Times Mirror Co. Class A 651,900 30,802
93,384
RESTAURANTS - 0.4%
McDonald's Corp. 952,600 43,343
TOTAL MEDIA & LEISURE 438,050
NONDURABLES - 10.1%
AGRICULTURE - 0.4%
Pioneer Hi-Bred International, Inc. 579,000 39,010
BEVERAGES - 2.0%
Anheuser-Busch Companies, Inc. 805,700 34,242
Coca-Cola Co. (The) 1,416,400 81,974
PepsiCo, Inc. 2,491,800 86,902
203,118
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONDURABLES - CONTINUED
FOODS - 1.7%
CPC International, Inc. 202,000 $ 15,529
General Mills, Inc. 757,820 51,342
Ralston Purina Co. 741,000 58,261
Sysco Corp. 1,448,600 47,623
172,755
HOUSEHOLD PRODUCTS - 3.2%
Avon Products, Inc. 580,200 36,408
Clorox Co. 608,900 72,231
First Brands Corp. 708,200 19,121
Gillette Co. 906,300 73,863
Procter & Gamble Co. 1,138,500 131,497
333,120
TOBACCO - 2.8%
Philip Morris Companies, Inc. 2,063,000 245,239
RJR Nabisco Holdings Corp. 1,140,741 37,359
282,598
TOTAL NONDURABLES 1,030,601
PRECIOUS METALS - 0.2%
Newmont Mining Corp. 452,400 18,039
RETAIL & WHOLESALE - 6.1%
APPAREL STORES - 0.1%
Gymboree Corp. (a) 511,700 11,769
DRUG STORES - 0.9%
General Nutrition Companies, Inc. (a) 1,153,560 20,908
Rite Aid Corp. 1,773,800 70,952
91,860
GENERAL MERCHANDISE STORES - 1.3%
Sears, Roebuck & Co. 1,484,600 71,261
Wal-Mart Stores, Inc. 2,777,400 65,963
137,224
GROCERY STORES - 1.2%
Kroger Co. (The) (a) 1,264,300 60,371
Safeway, Inc. (a) 1,198,100 57,209
117,580
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
RETAIL & WHOLESALE, MISCELLANEOUS - 2.6%
Circuit City Stores, Inc. 900,510 $ 31,630
Home Depot, Inc. (The) 827,500 40,961
Lowe's Companies, Inc. 1,419,700 47,028
PETsMART, Inc. (a) 1,606,916 36,557
Staples, Inc. (a) 2,359,300 48,366
Toys "R" Us, Inc. (a) 2,438,600 60,965
265,507
TOTAL RETAIL & WHOLESALE 623,940
SERVICES - 1.4%
ADVERTISING - 0.6%
Omnicom Group, Inc. 1,187,000 57,718
SERVICES - 0.8%
Block (H&R), Inc. 737,500 21,848
Manpower, Inc. 528,800 16,922
Service Corp. International 1,508,400 43,744
82,514
TOTAL SERVICES 140,232
TECHNOLOGY - 18.9%
COMMUNICATIONS EQUIPMENT - 3.5%
Ascend Communications, Inc. (a) 989,000 68,859
Aspect Telecommunications Corp. 991,400 30,733
Cisco Systems, Inc. (a) 1,936,600 135,078
Lucent Technologies, Inc. 548,121 29,736
Network General Corp. (a) 756,600 21,374
Pairgain Technologies, Inc. 854,100 34,965
3Com Corp. (a) 487,100 32,697
353,442
COMPUTER SERVICES & SOFTWARE - 4.7%
Automatic Data Processing, Inc. 1,605,190 66,415
CUC International, Inc. (a) 2,126,050 52,620
Ceridian Corp. (a) 537,241 20,281
Computer Associates International, Inc. 462,700 20,995
Computer Sciences Corp. (a) 508,760 35,995
DST Systems, Inc. (a) 653,300 21,314
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - CONTINUED
Electronic Data Systems Corp. 709,100 $ 32,619
Equifax, Inc. 446,200 14,055
First Data Corp. 1,055,200 37,987
HBO & Co. 181,400 11,360
Microsoft Corp. (a) 620,100 63,250
Oracle Systems Corp. (a) 1,164,200 45,258
PeopleSoft, Inc. (a) 734,800 40,047
Sabre Group Holdings, Inc. Class A (a) 493,700 13,268
475,464
COMPUTERS & OFFICE EQUIPMENT - 5.2%
Adaptec, Inc. (a) 2,090,200 91,446
Bay Networks, Inc. (a) 1,725,800 37,536
EMC Corp. 898,600 34,034
Hewlett-Packard Co. 678,000 35,680
International Business Machines Corp. 1,437,700 226,078
Pitney Bowes, Inc. 1,271,000 73,241
Silicon Graphics, Inc. (a) 1,246,200 34,115
532,130
ELECTRONICS - 4.7%
Intel Corp. 1,211,530 196,571
Linear Technology Corp. 1,842,890 89,841
Maxim Integrated Products, Inc. (a) 989,000 55,631
Motorola, Inc. 1,121,100 76,515
Texas Instruments, Inc. 824,900 64,652
483,210
PHOTOGRAPHIC EQUIPMENT - 0.8%
Eastman Kodak Co. 957,700 83,080
TOTAL TECHNOLOGY 1,927,326
TRANSPORTATION - 0.2%
RAILROADS - 0.2%
CSX Corp. 431,300 20,918
UTILITIES - 4.9%
CELLULAR - 0.5%
360 Degrees Communications Co. (a) 1,299,500 25,665
Vodafone Group PLC sponsored ADR 506,200 21,767
47,432
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - CONTINUED
TELEPHONE SERVICES - 4.4%
AT&T Corp. 504,460 $ 19,863
Ameritech Corp. 1,478,200 88,323
BellSouth Corp. 1,000,000 44,375
Cincinnati Bell, Inc. 801,600 49,599
LCI International, Inc. (a) 1,442,500 32,456
MCI Communications Corp. 1,973,100 69,305
SBC Communications, Inc. 1,735,400 95,230
WorldCom, Inc. (a) 1,982,800 49,818
448,969
TOTAL UTILITIES 496,401
TOTAL COMMON STOCKS
(Cost $7,817,480) 9,633,920
NONCONVERTIBLE PREFERRED STOCKS - 0.0%
ENERGY - 0.0%
OIL & GAS - 0.0%
Gulf Canada Resources Ltd., Series 1,
adj. rate (Cost $5) 2,015 7
CASH EQUIVALENTS - 5.3%
MATURITY AMOUNT
(000S)
Investments in repurchase agreements
(U.S. Treasury obligations) in a joint
trading account at 5.56%, dated
1/31/97 due 2/3/97 $ 4,516 4,514
SHARES
Taxable Central Cash Fund (b) 535,013,868 535,014
TOTAL CASH EQUIVALENTS
(Cost $539,528) 539,528
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $8,357,013) $ 10,173,455
LEGEND
1. Non-income producing
2. At period end, the seven-day yield on the Taxable Central Cash Fund was
5.39%. The yield refers to the income earned by investing in the fund over
the seven-day period, expressed as an annual percentage.
INCOME TAX INFORMATION
At January 31, 1997, the aggregate cost of investment securities for income
tax purposes was $8,370,752,000. Net unrealized appreciation aggregated
$1,802,703,000, of which $1,904,885,000 related to appreciated investment
securities and $102,182,000 related to depreciated investment securities.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNTS) JANUARY 31, 1997 (UNAUDITED)

ASSETS

Investment in securities, at value (including repurchase $ 10,173,455
agreements of $4,514) (cost $8,357,013) -
See accompanying schedule

Receivable for investments sold 29,120

Receivable for fund shares sold 2,366

Dividends receivable 9,407

Interest receivable 2,210

Other receivables 247

TOTAL ASSETS 10,216,805

LIABILITIES

Payable for investments purchased $ 86,142

Payable for fund shares redeemed 16,531

Accrued management fee 4,047

Other payables and accrued expenses 2,461

TOTAL LIABILITIES 109,181

NET ASSETS $ 10,107,624

Net Assets consist of:

Paid in capital $ 8,191,419

Undistributed net investment income 12,449

Accumulated undistributed net realized gain (loss) on 87,323
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 1,816,433
investments and assets and liabilities in foreign
currencies

NET ASSETS, for 292,254 shares outstanding $ 10,107,624

NET ASSET VALUE and redemption price per share $34.59
($10,107,624 (divided by) 292,254 shares)

Maximum offering price per share (100/97.00 of $34.59) $35.66

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS ENDED JANUARY 31, 1997 (UNAUDITED)

INVESTMENT INCOME $ 61,948
Dividends

Interest 15,334

TOTAL INCOME 77,282

EXPENSES

Management fee $ 27,920
Basic fee

Performance adjustment (2,997)

Transfer agent fees 13,039

Accounting fees and expenses 415

Non-interested trustees' compensation 39

Custodian fees and expenses 104

Registration fees 366

Audit 51

Legal 23

Miscellaneous 39

Total expenses before reductions 38,999

Expense reductions (753) 38,246

NET INVESTMENT INCOME 39,036

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

Investment securities 114,451

Foreign currency transactions (84) 114,367

Change in net unrealized appreciation (depreciation) on:

Investment securities 1,672,383

Assets and liabilities in foreign currencies (7) 1,672,376

NET GAIN (LOSS) 1,786,743

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 1,825,779
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED JANUARY JULY 31,
31, 1997 1996
(UNAUDITED)

INCREASE (DECREASE) IN NET ASSETS

Operations $ 39,036 $ 85,559
Net investment income

Net realized gain (loss) 114,367 964,681

Change in net unrealized appreciation (depreciation) 1,672,376 (900,783)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 1,825,779 149,457
FROM OPERATIONS

Distributions to shareholders (77,273) (28,183)
From net investment income

From net realized gain (604,623) (542,584)

TOTAL DISTRIBUTIONS (681,896) (570,767)

Share transactions 1,526,239 4,526,720
Net proceeds from sales of shares

Reinvestment of distributions 668,499 555,579

Cost of shares redeemed (1,410,307) (2,903,085)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 784,431 2,179,214
FROM SHARE TRANSACTIONS

TOTAL INCREASE (DECREASE) IN NET ASSETS 1,928,314 1,757,904

NET ASSETS

Beginning of period 8,179,310 6,421,406

End of period (including undistributed net investment $ 10,107,624 $ 8,179,310
income of $12,449 and $62,593, respectively)

OTHER INFORMATION
Shares

Sold 47,520 143,962

Issued in reinvestment of distributions 22,655 17,421

Redeemed (43,809) (92,535)

Net increase (decrease) 26,366 68,848

</TABLE>

FINANCIAL HIGHLIGHTS
SIX MONTHS YEARS ENDED JULY 31,
ENDED JANUARY
31, 1997

(UNAUDITED) 1996 1995 1994 E 1993 1992

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

Net asset value, $ 30.76 $ 32.59 $ 25.14 $ 25.72 $ 22.02 $ 18.94
beginning of period

Income from Investment
Operations

Net investment .14 D .34 .07 D .12 .10 .09
income

Net realized and 6.22 .42 7.96 3.43 4.36 3.07
unrealized gain (loss)

Total from investment 6.36 .76 8.03 3.55 4.46 3.16
operations

Less Distributions

From net investment (.28) (.12) - (.01) (.14) (.08)
income

From net realized (2.25) (2.47) (.58) (4.12) (.62) -
gain

Total distributions (2.53) (2.59) (.58) (4.13) (.76) (.08)

Net asset value, end $ 34.59 $ 30.76 $ 32.59 $ 25.14 $ 25.72 $ 22.02
of period

TOTAL RETURN B, C 22.12% 2.19% 32.64% 14.95% 20.86 16.73
% %

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of $ 10,108 $ 8,179 $ 6,421 $ 2,229 $ 788 $ 476
period (in millions)

Ratio of expenses to .84% A .98% 1.05% 1.27% 1.25 1.27
average net assets % %

Ratio of expenses to .82% A .95% 1.02% 1.22% 1.25 1.27
average net assets , F F F F % %
after expense
reductions

Ratio of net investment .84% A 1.10% .25% .21% .46 .55
income to average % %
net assets

Portfolio turnover rate 45% A 206% 182% 271% 319 71
% %

Average commission $ .0420
rate G

</TABLE>

A ANNUALIZED B 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). C TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND
FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. D NET INVESTMENT
INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING
DURING THE PERIOD. E EFFECTIVE AUGUST 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. F FMR
OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES WHO
EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS). G FOR FISCAL YEARS BEGINNING ON OR AFTER
SEPTEMBER 1, 1995, A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION
RATE PER SHARE FOR SECURITY TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS
AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX
OF TRADES EXECUTED IN VARIOUS MARKETS WHERE TRADING PRACTICES AND
COMMISSION RATE STRUCTURES MAY DIFFER.
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1997 (Unaudited)

1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Blue Chip Growth Fund (the fund) is a fund of Fidelity Securities
Fund (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 financial statements have
been prepared in conformity with generally accepted accounting principles
which permit management to make certain estimates and assumptions at the
date of the financial statements. 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 (including restricted 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 with remaining maturities
of sixty days or less for which quotations are not readily available are
valued at amortized cost or original cost plus accrued interest, both of
which approximate current value.
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. Income receipts
and expense payments are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and
sales of securities are translated into U.S. dollars at the contractual
currency exchange rates established at the time of each trade.
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, 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 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. Non-cash dividends included in dividend income, if any,
are recorded at the fair market value of the securities received.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
Interest income 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.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded 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 litigation
proceeds, futures and options transactions, foreign currency transactions,
passive foreign investment companies (PFIC), partnerships and losses
deferred due to wash sales. The fund also utilized earnings and profits
distributed to shareholders on redemption of shares as a part of the
dividends paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income 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.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign-denominated securities.
Losses may arise from changes in the value of the foreign currency or if
the counterparties do not perform under the contracts' terms. The U.S.
dollar value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), 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 for U.S. Treasury or
Federal Agency obligations.
2. OPERATING POLICIES -
CONTINUED
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account, at a bank custodian. The securities are marked-to-market
daily and maintained at a value at least equal to the principal amount of
the repurchase agreement (including accrued interest). FMR, the fund's
investment adviser, is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by the
SEC, the fund may invest in the Taxable Central Cash Fund (the Cash Fund)
managed by FMR Texas, an affiliate of FMR. The Cash Fund is an open-end
money market fund available only to investment companies and other accounts
managed by FMR and its affiliates. The Cash Fund seeks preservation of
capital, liquidity, and current income by investing in U.S. Treasury
securities and repurchase agreements for these securities, and may be
utilized by the fund as an additional cash management option. Dividends
from the Cash Fund are declared daily and paid monthly from net interest
income. Income distributions received by the fund are recorded as interest
income.
RESTRICTED SECURITIES. The fund is permitted to invest in securities that
are subject to legal or contractual restrictions on resale. These
securities generally may be resold in transactions exempt from
registration or to the public if the securities are registered. Disposal of
these securities may involve time-consuming negotiations and expense, and
prompt sale at an acceptable price may be difficult. At the end of the
period, the fund had no investments in restricted securities(excluding 144A
issues).
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $2,324,554,000 and $1,984,664,000, 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 .2500% 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% of the fund's average net assets over the performance
period) based on the fund's investment performance as compared to the
appropriate index over a specified period of time.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
MANAGEMENT FEE - CONTINUED
For the period, the management fee was equivalent to an annualized rate of
.53% of average net assets after the performance adjustment.
SALES LOAD. Fidelity Distributors Corporation (FDC), an affiliate of FMR,
is the general distributor of the fund. FDC is paid a 3% sales charge on
sales of shares of the fund. Prior to October 12, 1990, FDC was paid a 2%
sales charge and a 1% deferred sales charge. Shares purchased before
October 12, 1990 are subject to a 1% deferred sales charge upon redemption.
For the period, FDC received sales charges and deferred sales charges of
$1,190,000 and $12,000, respectively, on sales of shares of the fund.
TRANSFER AGENT FEES. Fidelity Service Company, Inc. (FSC), an affiliate of
FMR, is the fund's transfer, dividend disbursing and shareholder servicing
agent. FSC receives account fees and asset-based fees that vary according
to account size and type of account. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annualized rate of
.28% of average net assets.
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 $523,000 for the period.
5. 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
$542,000 under this arrangement.
In addition, the fund has entered into arrangements with its custodian and
transfer agent whereby interest earned on uninvested cash balances was used
to offset a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $2,000 and $209,000,
respectively, under these arrangements.
MANAGING YOUR INVESTMENTS

For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
851 East Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
811 Wilshire Boulevard
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
950 Northgate Drive
San Rafael, CA
1400 Civic Drive
Walnut Creek, CA
6300 Canoga Avenue
Woodland Hills, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
29 South Main Street
West Hartford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
90 Alhambra Plaza
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
4001 Tamiami Trail, North
Naples, FL
1907 West State Road 434
Orlando, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
1502 N. Westshore Blvd.
Tampa, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
One North Franklin
Chicago, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
3232 Lake Avenue
Wilmette, IL
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
44 Mall Road
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
29155 Northwestern Hwy.
Southfield, MI
MINNESOTA
7600 France Avenue South
Edina, MN
MISSOURI
700 West 47th Street
Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
150 Essex Street
Millburn, NJ
56 South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
NEW YORK
1050 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
1271 Avenue of the
Americas
New York, NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
10 Bank Street
White Plains, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
1903 East Ninth Street
Cleveland, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
Dallas, TX
1155 Dairy Ashford
Houston, TX
2701 Drexel Drive
Houston, TX
1010 Lamar Street
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
UTAH
215 South State Street
Salt Lake City, UT
VERMONT
199 Main Street
Burlington, VT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
511 Pine Street
Seattle, WA
WASHINGTON, DC
1900 K Street, N.W.
Washington, DC
WISCONSIN
595 North Barker Road
Brookfield, WI

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
Arthur S. Loring, Secretary
John McDowell, Vice President
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 *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
FIDELITY'S GROWTH FUNDS
Blue Chip Growth Fund
Capital Appreciation Fund
Contrafund
Disciplined Equity Fund
Dividend Growth Fund
Emerging Growth Fund
Export Fund
Fidelity Fifty
Growth Company Fund
Large Cap Stock Fund
Low-Priced Stock Fund
Magellan(registered trademark) Fund
Mid-Cap Stock Fund
New Millennium(trademark) Fund
OTC Portfolio
Retirement Growth Fund
Small Cap Stock Fund
Stock Selector
TechnoQuant(trademark) Growth Fund
Trend Fund
Value Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE

FIDELITY

(REGISTERED TRADEMARK)
DIVIDEND GROWTH
FUND
SEMIANNUAL REPORT
JANUARY 31, 1997
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
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 22 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 26 Notes to the financial statements.

THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE
PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, 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 FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND MONEY.
PRESIDENT'S MESSAGE

Fidelity Dividend Growth 23.20% 30.55% 134.05%

S&P 500(registered trademark) 24.15% 26.34% 99.88%

Growth Funds Average 20.94% 22.74% n/a

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, or since the fund
started on April 27, 1993. 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 the fund's return to the performance of the
Standard & Poor's 500 Index - a widely recognized, unmanaged index of
common stocks. To measure how the fund's performance stacked up against its
peers, you can compare it to the growth funds average, which reflects the
performance of 761 mutual funds with similar objectives tracked by Lipper
Analytical Services, Inc. over the past six months. These benchmarks
reflect reinvestment of dividends and capital gains, if any, and exclude
the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1997 PAST 1 LIFE OF
YEAR FUND

Fidelity Dividend Growth 30.55% 25.30%

S&P 500 26.34% 20.17%

Growth Funds Average 22.74% n/a

$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19970131 19970227 093839 S00000000000001
Dividend Growth SP Standard & Poor 500
00330 SP001
1993/04/27 10000.00 10000.00
1993/04/30 10150.00 10155.08
1993/05/31 10480.00 10427.23
1993/06/30 10700.00 10457.47
1993/07/31 10800.00 10415.64
1993/08/31 11550.00 10810.40
1993/09/30 11820.00 10727.16
1993/10/31 12080.00 10949.21
1993/11/30 11680.00 10845.19
1993/12/31 12171.52 10976.42
1994/01/31 12493.15 11349.62
1994/02/28 12302.18 11042.04
1994/03/31 11715.49 10560.61
1994/04/30 11786.37 10695.78
1994/05/31 11604.11 10871.20
1994/06/30 11310.46 10604.85
1994/07/31 11826.87 10952.69
1994/08/31 12616.68 11401.75
1994/09/30 12485.05 11122.41
1994/10/31 13041.96 11372.66
1994/11/30 12474.92 10958.47
1994/12/31 12691.18 11120.98
1995/01/31 12732.22 11409.35
1995/02/28 13142.60 11853.97
1995/03/31 13768.44 12203.78
1995/04/30 14404.54 12563.19
1995/05/31 14907.26 13065.34
1995/06/30 15728.03 13368.84
1995/07/31 16456.47 13812.15
1995/08/31 16528.28 13846.82
1995/09/30 16956.49 14431.16
1995/10/31 16359.88 14379.64
1995/11/30 17176.30 15010.91
1995/12/31 17454.52 15300.02
1996/01/31 17928.35 15820.83
1996/02/29 18479.31 15967.49
1996/03/31 18964.16 16121.25
1996/04/30 19845.70 16358.88
1996/05/31 20484.81 16780.78
1996/06/30 19933.85 16844.71
1996/07/31 18997.21 16100.51
1996/08/31 19614.29 16440.07
1996/09/30 20604.68 17365.32
1996/10/31 21100.90 17844.26
1996/11/30 22533.19 19193.10
1996/12/31 22715.29 18812.89
1997/01/31 23405.00 19988.32
IMATRL PRASUN SHR__CHT 19970131 19970227 093841 R00000000000049

$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Dividend Growth Fund on April 27, 1993, when the fund
started. As the chart shows, by January 31, 1997, the value of the
investment would have grown to $23,405 - an 134.05% increase on the initial
investment. For comparison, look at how the S&P 500 did over the same
period. With dividends and capital gains, if any, reinvested, the same
$10,000 investment would have grown to $19,988 - a 99.88% 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

NOTE TO SHAREHOLDERS: Charles Mangum became Portfolio Manager of Fidelity
Dividend Growth Fund on January 7, 1997.
Q. HOW DID THE FUND PERFORM, CHARLES?
A. Very well. For the six-month period that ended January 31, 1997, the
fund had a total return of 23.20%, beating the 20.94% return of the growth
funds average, according to Lipper Analytical Services. For the 12-month
period that ended January 31, 1997, the fund had a total return of 30.55%,
versus 22.74% for the same period for the growth funds average. For the six
and 12-month periods that ended January 31, 1997, the Standard & Poor's 500
Index returned 24.15% and 26.34%, respectively.
Q. WHAT HELPED THE FUND POST SUCH A STRONG PERFORMANCE?
A. The fund's performance was driven by stock picking. The previous manager
- - Steve Wymer, who managed the fund through most of the period - didn't
pursue any sector-based strategies or position the fund to take advantage
of specific economic trends. Instead, the stock-by-stock process he used to
select investments for the fund paid off, with securities such as
Tupperware, Earthgrains, Interstate Bakeries, Imation and Allegiance
performing very well.
Q. HOW WOULD YOU DESCRIBE THE STOCK MARKET ENVIRONMENT OVER THE PAST SIX
MONTHS?
A. While the stock market posted solid returns, the strongest performance
came from the stocks of the largest companies, based, in part on the fact
that these companies posted the best earnings and revenue growth. In
addition, sentiment toward stocks was very positive, with investors putting
a great deal of money into the market. Many institutional money managers
looked toward the larger stocks to stay fully invested because
large-capitalization issues offer lower volatility and a higher degree of
liquidity over smaller-company issues. Steve's stock-picking performance
was especially noteworthy because mid-capitalization stocks as a whole -
which made up a large proportion of the fund during his tenure - didn't
perform as well as stocks of larger companies.
Q. WHILE THE FUND PERFORMED WELL, THERE MUST HAVE BEEN SOME DISAPPOINTMENTS
. . .
A. In 1996, Steve had what I would call a legendary year as a stock picker.
There were not many stocks that lost ground, and those that did were very
small positions in the fund. One stock that didn't do well was Pharmacia &
Upjohn, which the fund no longer owns. This company - which was formed by a
merger of two companies last year - has had trouble making adjustments
after combining forces, and those difficulties have been reflected in
earnings disappointments.
Q. WHAT CHANGES HAVE YOU MADE SINCE TAKING OVER THE FUND?
A. I've focused more on larger-capitalization stocks. I've looked for
companies with solid business prospects, good earnings growth and
attractive valuations. In addition, I've cut back on some of the mid-cap
names that Steve owned, mainly because my investing style is different from
his. Steve tended to focus on special situations such as spin-offs,
turnaround stories and those companies that were improving their profit
margins. I focus more on revenue growth, because I feel a company with
strong revenue growth tends to be a safer investment. This kind of company
typically is a large one and includes drug, financial and diversified
companies. When I took over the fund, I increased the fund's holdings in
companies such as Johnson & Johnson, Schering-Plough, CitiCorp, Wells Fargo
and General Electric.
Q. THOSE COMPANIES GENERATE FAIRLY STEADY DIVIDENDS, DON'T THEY?
A. Yes, they do. Shareholders probably will see more dividend-providing,
larger-capitalization companies in the fund, as my strength lies in the
analysis of large-cap growth names.
Q. YOU'VE ALSO REDUCED THE NUMBER OF STOCKS IN THE FUND . . .
A. Yes, I prefer to work with a smaller number of stocks in my portfolio.
When I took over the fund in January, there were about 290 stocks in the
fund. By the end of January, that number was down to about 220. Ideally, I
may cut the number a bit more, to 150 to 200 stocks or so. I feel that if I
talk to or analyze, say, five companies a day, in two months time I can
completely review each position in the fund. That's the kind of number and
time frame that best suits my style. Of course, I stay on top of
developments concerning the companies in the fund, by working with analysts
who keep track of their performance on a daily basis.
Q. WHAT'S YOUR OUTLOOK?
A. I really don't spend time developing an overall outlook for the market.
I focus on what I can control, which is finding good companies that can
grow over time. I look for values or growth opportunities by analyzing
companies one at a time. My goal is to find growth companies paying
dividends that are going to grow faster than the market and, hopefully,
appreciate in price faster than the market as well.
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: to increase the value
of the fund's shares by
investing mainly in equity
securities of companies
that have the potential to
increase their current
dividend or begin paying a
dividend
FUND NUMBER: 330
TRADING SYMBOL: FDGFX
START DATE: April 27, 1993
SIZE: as of January 31,
1997, more than $2.9 billion
MANAGER: Charles Mangum,
since January 1997;
manager, Fidelity OTC
Portfolio, June
1996-January 1997; Fidelity
Convertible Securities
Fund, 1995-1996; Fidelity
Select Health Care Portfolio,
1992-1995; Fidelity Select
Medical Delivery Portfolio,
1991-1993; joined Fidelity in
1990
(checkmark)
CHARLES MANGUM ON HIS
INVESTMENT STYLE:
"I am first and foremost a
growth investor. I focus on
growth companies. My
reasoning is simple: a true
growth company can `grow
into' its share price, even if I
pay a slight premium to own
the stock. That doesn't mean I
completely avoid value stocks
or other types of stocks if I
feel they offer good long-term
growth prospects. If I've
bought what turns out to be a
bargain, I can get what's
called a multiplier effect, when
a company's stock price rises
much faster than the
company's earnings growth
rate. I'm not a market timer,
so I tend to be as fully
invested as I reasonably can
be at all times."
INVESTMENT CHANGES

TOP TEN STOCKS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

General Electric Co. 3.0 0.3

Intel Corp. 2.8 0.7

Philip Morris Companies, Inc. 2.4 3.5

Johnson & Johnson 1.9 0.1

Schering-Plough Corp. 1.9 0.2

Citicorp 1.6 0.5

IKON Office Solutions, Inc. 1.5 0.0

Imation Corp. 1.5 0.4

Exxon Corp. 1.4 0.0

International Business Machines 1.3 0.0
Corp.

TOP FIVE MARKET SECTORS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET
SECTORS
6 MONTHS AGO

Finance 11.6 8.2

Health 11.0 2.7

Technology 11.0 6.7

Nondurables 8.8 13.4

Energy 7.6 9.3

ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JANUARY 31, 1997 * AS OF JULY 31, 1996 **
Row: 1, Col: 1, Value: 6.8
Row: 1, Col: 2, Value: 1.6
Row: 1, Col: 3, Value: 41.6
Row: 1, Col: 4, Value: 50.0
Row: 1, Col: 1, Value: 6.3
Row: 1, Col: 2, Value: 48.7
Row: 1, Col: 3, Value: 45.0
Stocks 92.6%
Bonds 0.6%
Short-term
investments 6.8%
FOREIGN
INVESTMENTS 2.8%
Stocks 93.7%
Bonds 0.0%
Short-term
investments 6.3%
FOREIGN
INVESTMENTS 4.3%
*
**
INVESTMENTS JANUARY 31, 1997 (UNAUDITED)

Showing Percentage of Total Value of Investment in Securities

COMMON STOCKS - 92.1%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 2.6%
AEROSPACE & DEFENSE - 1.8%
Boeing Co. 124,233 $ 13,308
Harsco Corp. 9,300 652
Lockheed Martin Corp. 9,500 874
McDonnell Douglas Corp. 285,000 19,166
Rockwell International Corp. 230,800 15,175
Sundstrand Corp. 110,000 4,716
53,891
DEFENSE ELECTRONICS - 0.3%
Raytheon Co. 217,500 9,978
SHIP BUILDING & REPAIR - 0.5%
General Dynamics Corp. 236,500 16,703
TOTAL AEROSPACE & DEFENSE 80,572
BASIC INDUSTRIES - 6.7%
CHEMICALS & PLASTICS - 2.8%
Betz Dearborn, Inc. 305,300 17,860
Cambrex Corp. 104,100 3,761
Nalco Chemical Co. 735,000 26,092
Olin Corp. 153,000 5,604
Primex Technologies, Inc. (a) 217,900 4,222
Quaker Chemical Corp. 93,300 1,528
Quaker State Corp. 90,200 1,218
Raychem Corp. 170,500 14,769
Union Carbide Corp. 218,500 9,914
84,968
IRON & STEEL - 0.1%
Nucor Corp. 65,700 3,417
PACKAGING & CONTAINERS - 1.2%
Corning, Inc. 374,500 13,342
Tupperware Corp. 490,400 22,987
36,329
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
BASIC INDUSTRIES - CONTINUED
PAPER & FOREST PRODUCTS - 2.6%
American Pad & Paper Co. (a)(c) 1,145,300 $ 27,344
International Paper Co. 280,500 11,465
Kimberly-Clark Corp. 192,500 18,769
Unisource Worldwide, Inc. 1,008,450 21,934
79,512
TOTAL BASIC INDUSTRIES 204,226
CONGLOMERATES - 0.1%
GenCorp, Inc. 142,800 2,785
CONSTRUCTION & REAL ESTATE - 2.6%
BUILDING MATERIALS - 0.5%
Masco Corp. 298,500 10,298
Sherwin-Williams Co. 60,000 3,330
13,628
ENGINEERING - 0.1%
EG&G, Inc. 180,400 3,834
REAL ESTATE - 1.0%
Catellus Development Corp. (a) 876,600 12,053
Rouse Co. (The) 120,000 3,720
Trizec Hahn Corp. (sub-vtg.) 600,000 14,098
29,871
REAL ESTATE INVESTMENT TRUSTS - 1.0%
Arden Realty Group, Inc. 211,700 5,663
Beacon Properties Corp. 114,300 4,086
Cali Realty Corp. 119,000 3,927
Carr Realty Corp. 237,800 6,926
Crescent Real Estate Equities, Inc. 59,700 3,201
Starwood Lodging Trust combined certificate (SBI) 177,750 7,266
31,069
TOTAL CONSTRUCTION & REAL ESTATE 78,402
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
DURABLES - 2.9%
AUTOS, TIRES, & ACCESSORIES - 0.7%
Chrysler Corp. 200,000 $ 6,975
NGC Corp. 280,400 6,029
SPX Corp. 221,600 9,002
22,006
CONSUMER DURABLES - 0.2%
Minnesota Mining & Manufacturing Co. 77,200 6,581
CONSUMER ELECTRONICS - 0.8%
Newell Co. 100,000 3,300
Sunbeam-Oster, Inc. 761,100 21,121
24,421
HOME FURNISHINGS - 0.2%
O'Sullivan Industries Holdings (a) 393,500 5,066
TEXTILES & APPAREL - 1.0%
Adidas AG 25,500 2,404
NIKE, Inc. Class B 145,000 9,842
Reebok International Ltd. 330,000 15,675
Wolverine World Wide, Inc. 109,400 3,378
31,299
TOTAL DURABLES 89,373
ENERGY - 7.6%
ENERGY SERVICES - 0.4%
Baker Hughes, Inc. 93,000 3,627
Dresser Industries, Inc. 94,000 3,184
Halliburton Co. 30,000 2,172
Weatherford Enterra, Inc. (a) 74,500 2,710
11,693
OIL & GAS - 7.2%
Atlantic Richfield Co. 100,000 13,225
Belco Oil & Gas Corp. (a) 61,500 1,637
Chevron Corp. 205,000 13,607
Cooper Cameron Corp. (a) 55,076 4,014
Exxon Corp. 400,000 41,450
Flores & Rucks, Inc. (a) 60,000 3,082
KCS Group, Inc. 68,400 2,659
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
ENERGY - CONTINUED
OIL & GAS - CONTINUED
Monterey Resources, Inc. (a)(c) 809,000 $ 12,539
Pogo Producing Co. 100,000 4,212
Royal Dutch Petroleum Co. ADR 160,000 27,760
Santa Fe Energy Resources, Inc. (a) 425,800 6,334
Tosco Corp. 235,300 20,824
Total SA sponsored ADR 285,000 12,291
USX-Marathon Group 225,000 5,991
Ultramar Diamond Shamrock Corp. 550,500 16,171
Union Pacific Resources Group, Inc. 619,200 17,570
Valero Energy Corp. 370,000 12,488
Vintage Petroleum, Inc. 115,300 3,848
219,702
TOTAL ENERGY 231,395
FINANCE - 11.6%
BANKS - 5.3%
Advanta Corp. 48,100 2,249
Banc One Corp. 155,790 7,069
Bank of New York Co., Inc. 100,000 3,662
BankAmerica Corp. 217,600 24,290
Citicorp 423,300 49,262
Fifth Third Bancorp 8,000 619
First Bank System, Inc. 50,000 3,800
NationsBank Corp. 275,000 29,700
Northern Trust Corp. 163,000 6,683
State Street Boston Corp. 50,000 3,656
Wells Fargo & Co. 98,200 29,926
160,916
CREDIT & OTHER FINANCE - 1.1%
American Express Co. 338,392 21,107
Associates First Capital Corp. 61,000 2,966
Household International, Inc. 20,000 1,983
MBNA Corp. 200,000 6,900
32,956
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - CONTINUED
FEDERAL SPONSORED CREDIT - 1.1%
Federal National Mortgage Association 565,000 $ 22,318
Student Loan Marketing Association 114,000 12,412
34,730
INSURANCE - 2.7%
Aetna, Inc. 213,800 16,890
Allmerica Financial Corp. 638,100 23,370
Conseco, Inc. 274,600 20,183
FBL Financial Group, Inc. Class A 178,400 4,215
Protective Life Corp. 52,500 2,080
Provident Companies, Inc. 118,000 5,797
UNUM Corp. 141,100 10,671
83,206
SAVINGS & LOANS - 1.2%
Charter One Financial Corp. 361,600 16,317
TCF Financial Corp. 54,900 2,326
Washington Mutual, Inc. 319,000 17,326
35,969
SECURITIES INDUSTRY - 0.2%
Franklin Resources, Inc. 75,750 4,128
Schwab (Charles) Corp. 55,000 2,056
6,184
TOTAL FINANCE 353,961
HEALTH - 11.0%
DRUGS & PHARMACEUTICALS - 4.8%
American Home Products Corp. 400,000 25,350
Bristol-Myers Squibb Co. 290,000 36,830
Merck & Co., Inc. 285,000 25,864
Schering-Plough Corp. 756,400 57,203
145,247
MEDICAL EQUIPMENT & SUPPLIES - 4.8%
Abbott Laboratories 300,000 16,312
Allegiance Corp. 945,660 24,232
Baxter International, Inc. 87,000 4,013
Becton, Dickinson & Co. 307,200 15,130
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
MEDICAL EQUIPMENT & SUPPLIES - CONTINUED
Bergen Brunswig Corp. Class A 222,500 $ 6,619
Johnson & Johnson 1,030,800 59,400
McKesson Corp. 99,800 5,876
Medtronic, Inc. 80,000 5,480
Nellcor, Inc. 665,700 11,317
148,379
MEDICAL FACILITIES MANAGEMENT - 1.4%
Columbia/HCA Healthcare Corp. 525,000 20,737
Integramed America, Inc. (a)(c) 605,500 1,060
NovaCare, Inc. (a) 294,900 3,133
United HealthCare Corp. 350,000 17,063
41,993
TOTAL HEALTH 335,619
INDUSTRIAL MACHINERY & EQUIPMENT - 5.9%
ELECTRICAL EQUIPMENT - 4.5%
Allen Group, Inc. (a) 379,700 9,303
General Electric Co. 898,000 92,494
General Signal Corp. 299,100 13,534
Westinghouse Electric Corp. 1,105,900 20,321
135,652
INDUSTRIAL MACHINERY & EQUIPMENT - 0.7%
BW/IP Holdings, Inc. Class A 938,900 15,844
Stanley Works 135,600 5,153
20,997
POLLUTION CONTROL - 0.7%
Allied Waste Industries, Inc. (a) 180,000 1,687
Browning-Ferris Industries, Inc. 170,000 5,525
WMX Technologies, Inc. 400,000 14,650
21,862
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 178,511
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - 5.1%
ENTERTAINMENT - 0.7%
Disney (Walt) Co. 305,000 $ 22,341
LEISURE DURABLES & TOYS - 0.9%
Callaway Golf Co. 199,000 6,641
Hasbro, Inc. 407,900 16,112
Outboard Marine Corp. 265,000 4,406
27,159
LODGING & GAMING - 0.4%
Hilton Hotels Corp. 165,000 4,702
La Quinta Motor Inns, Inc. 184,900 3,606
Mirage Resorts, Inc. (a) 100,000 2,513
10,821
PUBLISHING - 2.5%
ACNielsen Corp. (a) 747,133 12,234
Cognizant Corp. 1,154,400 37,085
Dun & Bradstreet Corp. 744,600 17,870
New York Times Co. (The) Class A 147,100 5,645
Times Mirror Co. Class A 5,600 265
Tribune Co. 100,000 3,825
76,924
RESTAURANTS - 0.6%
McDonald's Corp. 367,200 16,708
Morrison Health Care, Inc. 108,100 1,567
18,275
TOTAL MEDIA & LEISURE 155,520
NONDURABLES - 8.8%
BEVERAGES - 1.2%
Coors (Adolph) Co. Class B 347,100 6,465
PepsiCo, Inc. 850,000 29,643
36,108
FOODS - 1.9%
Earthgrains Co. 414,272 19,315
Flowers Industries, Inc. 330,600 7,067
Interstate Bakeries Corp. 207,000 9,186
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONDURABLES - CONTINUED
FOODS - CONTINUED
Kellogg Co. 100,000 $ 6,962
Nabisco Holdings Corp. Class A 385,000 14,726
Riviana Foods, Inc. 34,800 609
57,865
HOUSEHOLD PRODUCTS - 2.3%
Alberto-Culver Co. Class A 337,300 15,052
Dial Corp. 713,200 9,806
Premark International, Inc. 455,000 10,465
Procter & Gamble Co. 170,000 19,635
Unilever NV ADR 90,800 14,937
69,895
TOBACCO - 3.4%
American Brands, Inc. 100,000 5,100
Philip Morris Companies, Inc. 614,900 73,096
RJR Nabisco Holdings Corp. 680,000 22,270
Schweitzer-Mauduit International, Inc. 67,700 2,293
102,759
TOTAL NONDURABLES 266,627
PRECIOUS METALS - 0.5%
Barrick Gold Corp. 250,000 6,755
Newmont Mining Corp. 211,100 8,418
15,173
RETAIL & WHOLESALE - 4.9%
APPAREL STORES - 0.6%
Gap, Inc. 265,000 7,619
Payless ShoeSource, Inc. (a) 283,256 10,622
18,241
DRUG STORES - 0.8%
CVS Corp. 540,500 23,377
GENERAL MERCHANDISE STORES - 0.8%
Proffitts, Inc. (a) 240,500 8,718
Wal-Mart Stores, Inc. 470,000 11,162
Woolworth Corp. (a) 275,000 5,603
25,483
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
GROCERY STORES - 0.2%
Dominick's Supermarkets, Inc. (a) 254,800 $ 5,096
RETAIL & WHOLESALE, MISCELLANEOUS - 2.5%
Borders Group, Inc. (a) 70,000 3,124
CML Group, Inc. 646,800 2,102
Home Depot, Inc. 470,000 23,265
IKON Office Solutions, Inc. 1,063,000 46,905
Staples, Inc. (a) 100,000 2,050
77,446
TOTAL RETAIL & WHOLESALE 149,643
SERVICES - 1.7%
ADVERTISING - 1.2%
Interpublic Group of Companies, Inc. 270,000 13,331
Omnicom Group, Inc. 457,700 22,256
35,587
PRINTING - 0.2%
New England Business Service, Inc. 339,000 7,034
SERVICES - 0.3%
Borg Warner Security Corp. (a) 716,900 7,976
TOTAL SERVICES 50,597
TECHNOLOGY - 11.0%
COMMUNICATIONS EQUIPMENT - 0.8%
Cisco Systems, Inc. 270,000 18,833
Lucent Technologies, Inc. 110,000 5,967
24,800
COMPUTER SERVICES & SOFTWARE - 1.1%
Autodesk, Inc. 177,500 5,613
CompUSA, Inc. (a) 569,800 11,681
DST Systems, Inc. (a) 267,000 8,711
First Data Corp. 170,000 6,120
Policy Management Systems Corp. (a) 64,600 2,907
35,032
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTERS & OFFICE EQUIPMENT - 2.7%
Diebold, Inc. 70,000 $ 4,130
FileNet Corp. (a) 88,500 1,693
Hewlett-Packard Co. 225,000 11,841
International Business Machines Corp. 250,000 39,312
Pitney Bowes, Inc. 242,900 13,997
Silicon Graphics, Inc. (a) 100,000 2,737
Wang Laboratories, Inc. (a) 319,700 7,433
81,143
ELECTRONIC INSTRUMENTS - 0.2%
Varian Associates, Inc. 85,000 4,675
ELECTRONICS - 4.0%
AMP, Inc. 220,100 8,969
Avnet, Inc. 139,000 8,601
Intel Corp. 533,300 86,528
Linear Technology Corp. 271,100 13,216
Molex, Inc. 140,600 4,956
122,270
PHOTOGRAPHIC EQUIPMENT - 2.2%
Eastman Kodak Co. 241,000 20,907
Imation Corp. (a) 1,593,620 46,414
67,321
TOTAL TECHNOLOGY 335,241
TRANSPORTATION - 3.4%
AIR TRANSPORTATION - 1.1%
Delta Air Lines, Inc. 169,600 13,398
Viad Corp. 1,232,700 19,415
32,813
RAILROADS - 0.7%
CSX Corp. 300,000 14,550
Canadian National Railway Co. 200,000 7,951
22,501
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TRANSPORTATION - CONTINUED
TRUCKING & FREIGHT - 1.6%
Consolidated Freightways, Inc. 665,000 $ 16,874
Roadway Express, Inc. (c) 1,073,590 22,009
USFreightways Corp. 110,200 2,796
Werner Enterprises, Inc. 110,200 1,984
Yellow Corp. (a) 302,700 5,184
48,847
TOTAL TRANSPORTATION 104,161
UTILITIES - 5.7%
CELLULAR - 0.5%
Century Telephone Enterprises, Inc. 530,200 16,635
ELECTRIC UTILITY - 0.2%
CILCORP, Inc. 70,000 2,695
Houston Industries, Inc. 100,000 2,262
Portland General Corp. 37,500 1,472
6,429
GAS - 0.5%
Enron Corp. 181,600 7,491
K N Energy, Inc. 52,400 2,037
ONEOK, Inc. 142,000 4,207
13,735
TELEPHONE SERVICES - 4.5%
ALLTEL Corp. 500,000 16,063
Ameritech Corp. 280,000 16,730
Cincinnati Bell, Inc. 68,200 4,220
GTE Corp. 685,300 32,209
MCI Communications Corp. 510,000 17,914
NYNEX Corp. 296,000 14,985
Pacific Telesis Group 267,500 10,499
SBC Communications, Inc. 462,000 25,352
137,972
TOTAL UTILITIES 174,771
TOTAL COMMON STOCKS
(Cost $2,486,207) 2,806,577
CONVERTIBLE PREFERRED STOCKS - 0.5%
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - 0.5%
TELEPHONE SERVICES - 0.5%
Worldcom, Inc. 8%, depositary shares
(Cost $15,048) 161,000 $ 14,269
CONVERTIBLE BONDS - 0.6%
MOODY'S PRINCIPAL
RATING AMOUNT
(000S)
RETAIL & WHOLESALE - 0.6%
U.S. Office Products Co. 5 1/2%, 2/1/01
(Cost $19,545) B3 $ 15,000 19,425
CASH EQUIVALENTS - 6.8%
SHARES VALUE (NOTE 1)
Taxable Central Cash Fund (b)
(Cost $208,413) 208,412,852 208,413
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $2,729,213) $ 3,048,684
LEGEND
1. Non-income producing
2. At period end, the seven-day yield on the Taxable Central Cash Fund was
5.39%. The yield refers to the income earned by investing in the fund over
the seven-day period, expressed as an annual percentage.
3. Affiliated company (see Note 6 of Notes to Financial Statements).
INCOME TAX INFORMATION
At January 31, 1997, the aggregate cost of investment securities for income
tax purposes was $2,730,843,000. Net unrealized appreciation aggregated
$317,841,000, of which $342,215,000 related to appreciated investment
securities and $24,374,000 related to depreciated investment securities.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS(EXCEPT PER-SHARE AMOUNT) JANUARY 31, 1997 (UNAUDITED)

ASSETS

Investment in securities, at value (cost $2,729,213) - $ 3,048,684
See accompanying schedule

Cash 906

Receivable for investments sold 120,209

Receivable for fund shares sold 33,228

Dividends receivable 2,209

Interest receivable 1,559

Other receivables 1

TOTAL ASSETS 3,206,796

LIABILITIES

Payable for investments purchased $ 196,884

Payable for fund shares redeemed 11,043

Accrued management fee 1,466

Other payables and accrued expenses 976

TOTAL LIABILITIES 210,369

NET ASSETS $ 2,996,427

Net Assets consist of:

Paid in capital $ 2,592,068

Undistributed net investment income 2,611

Accumulated undistributed net realized gain (loss) on 82,277
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 319,471
investments

NET ASSETS, for 144,761 shares outstanding $ 2,996,427

NET ASSET VALUE, offering price and redemption price per $20.70
share ($2,996,427 (divided by) 144,761 shares)

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS ENDED JANUARY 31, 1997 (UNAUDITED)

INVESTMENT INCOME $ 13,519
Dividends (including $101 received from affiliated issuers)

Interest 3,567

TOTAL INCOME 17,086

EXPENSES

Management fee $ 5,583
Basic fee

Performance adjustment 484

Transfer agent fees 2,117

Accounting fees and expenses 340

Non-interested trustees' compensation 5

Custodian fees and expenses 50

Registration fees 607

Audit 17

Legal 3

Miscellaneous 5

Total expenses before reductions 9,211

Expense reductions (341) 8,870

NET INVESTMENT INCOME 8,216

REALIZED AND UNREALIZED GAIN (LOSS) 86,851
Net realized gain (loss) on investment securities
(including realized gain (loss) of $8,171 on sales of
investments in affiliated issuers)

Change in net unrealized appreciation (depreciation) on 276,168
investment securities

NET GAIN (LOSS) 363,019

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 371,235
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED JULY 31,
JANUARY 31, 1997 1996
(UNAUDITED)

INCREASE (DECREASE) IN NET ASSETS

Operations $ 8,216 $ 6,344
Net investment income

Net realized gain (loss) 86,851 65,571

Change in net unrealized appreciation (depreciation) 276,168 (14,621)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 371,235 57,294
FROM OPERATIONS

Distributions to shareholders (8,329) (2,757)
From net investment income

From net realized gain (28,170) (32,750)

TOTAL DISTRIBUTIONS (36,499) (35,507)

Share transactions 2,217,998 1,696,572
Net proceeds from sales of shares

Reinvestment of distributions 36,072 34,964

Cost of shares redeemed (812,248) (998,307)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 1,441,822 733,229
FROM SHARE TRANSACTIONS

TOTAL INCREASE (DECREASE) IN NET ASSETS 1,776,558 755,016

NET ASSETS

Beginning of period 1,219,869 464,853

End of period (including undistributed net investment $ 2,996,427 $ 1,219,869
income of $2,611 and $4,406, respectively)

OTHER INFORMATION
Shares

Sold 113,930 97,237

Issued in reinvestment of distributions 2,034 2,199

Redeemed (41,942) (57,679)

Net increase (decrease) 74,022 41,757

</TABLE>

FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED JULY 31, APRIL 27, 1993
ENDED JANUARY (COMMENCEMENT
31, 1997 OF OPERATIONS) TO

</TABLE>

(UNAUDITED) 1996 1995 1994 E JULY 31, 1993

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

Net asset value, beginning $ 17.24 $ 16.04 $ 11.68 $ 10.80 $ 10.00
of period

Income from Investment
Operations

Net investment income .08 H .11 .05 .02 (.01)

Net realized and 3.84 2.25 4.47 1.01 .81
unrealized gain (loss)

Total from investment 3.92 2.36 4.52 1.03 .80
operations

Less Distributions

From net investment (.09) (.09) (.01) (.01) -
income

From net realized gain (.37) (1.07) (.15) - -

In excess of net realized - - - (.14) -
gain

Total distributions (.46) (1.16) (.16) (.15) -

Net asset value, end of period $ 20.70 $ 17.24 $ 16.04 $ 11.68 $ 10.80

TOTAL RETURN B, C 23.20% 15.44% 39.14% 9.51% 8.00%

RATIOS AND SUPPLEMENTAL
DATA

Net assets, end of period $ 2,996 $ 1,220 $ 465 $ 72 $ 18
(in millions)

Ratio of expenses to average .98% A 1.02% 1.21% 1.43% 2.50% A
net assets , D

Ratio of expenses to average .95% A .99% 1.19% 1.40% 2.50% A
net assets after expense , F F F F
reductions

Ratio of net investment .88% A .86% .78% .13% (.73)%
income to average net A
assets

Portfolio turnover rate 116% A 129% 162% 291% 90% A

Average commission rate G $ .0419

</TABLE>

ANNUALIZED
TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
LIMITED IN ACCORDANCE WITH A STATE EXPENSE LIMITATION.
EFFECTIVE AUGUST 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.
FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS).
FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES
OUTSTANDING DURING THE PERIOD.
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1997 (Unaudited)

6. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Dividend Growth Fund (the fund) is a fund of Fidelity Securities
Fund (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 financial statements have
been prepared in conformity with generally accepted accounting principles
which permit management to make certain estimates and assumptions at the
date of the financial statements. 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 with remaining maturities of sixty days or less for which
quotations are not readily available are valued at amortized cost or
original cost plus accrued interest, both of which approximate current
value.
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. Income receipts
and expense payments are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and
sales of securities are translated into U.S. dollars at the contractual
currency exchange rates established at the time of each trade.
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, 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 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
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. Non-cash dividends included in dividend income, if any,
are recorded at the fair market value of the securities received. Interest
income 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.
DISTRIBUTIONS TO SHAREHOLDERS.
Distributions are recorded 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, non-taxable dividends and losses deferred due to
wash sales. The fund also utilized earnings and profits distributed to
shareholders on redemption of shares as a part of the dividends paid
deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income 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.
7. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign-denominated securities.
Losses may arise from changes in the value of the foreign currency or if
the counterparties do not perform under the contracts' terms. The U.S.
dollar value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), 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 for U.S. Treasury or
Federal Agency obligations.
2. OPERATING POLICIES - CONTINUED
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account, at a bank custodian. The securities are marked-to-market
daily and maintained at a value at least equal to the principal amount of
the repurchase agreement (including accrued interest). FMR, the fund's
investment adviser, is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by the
SEC, the fund may invest in the Taxable Central Cash Fund (the Cash Fund)
managed by FMR Texas, an affiliate of FMR. The Cash Fund is an open-end
money market fund available only to investment companies and other accounts
managed by FMR and its affiliates. The Cash Fund seeks preservation of
capital, liquidity, and current income by investing in U.S. Treasury
securities and repurchase agreements for these securities, and may be
utilized by the fund as an additional cash management option. Dividends
from the Cash Fund are declared daily and paid monthly from net interest
income. Income distributions received by the fund are recorded as interest
income.
8. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $2,393,791,000 and $1,048,077,000,
respectively.
9. 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 .2500% 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% of the fund's average net assets over the performance
period) based on the fund's investment performance as compared to the
appropriate index over a specified period of time. For the period, the
management fee was equivalent to an annualized rate of .65% of average net
assets after the performance adjustment.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
TRANSFER AGENT FEES. Fidelity Service Company, Inc. (FSC), an affiliate of
FMR, is the fund's transfer, dividend disbursing and shareholder servicing
agent. FSC receives account fees and asset-based fees that vary according
to account size and type of account. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annualized rate of
.23% of average net assets.
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 $540,000 for the period.
10. 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
$319,000 under this arrangement.
In addition, the fund has entered into arrangements with its custodian and
transfer agent whereby interest earned on uninvested cash balances was used
to offset a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $4,000 and $18,000,
respectively, under these arrangements.
11. 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
DOLLAR AMOUNTS IN THOUSANDS PURCHASE SALES DIVIDEND VALUE
AFFILIATES COST COST INCOME
American Pad & Paper Co. $ 3,519 $ - $ - $ 27,344
Earthgrains Co. - 25,582 101 -
Integramed America, Inc. - - - 1,060
Monterey Resources, Inc. 6,308 - - 12,539
Roadway Express, Inc. - - - 22,009
TOTALS $ 9,827 $ 25,582 $ 101 $ 62,952
MANAGING YOUR INVESTMENTS

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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
Charles Mangum, 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 *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
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FIDELITY

(REGISTERED TRADEMARK)
GROWTH & INCOME
PORTFOLIO
SEMIANNUAL REPORT
JANUARY 31, 1997
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
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 26 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 30 Notes to the financial statements.

Fidelity Growth & Income 19.21% 21.11% 125.59% 359.33%

S&P 500(registered trademark) 24.15% 26.34% 119.87% 288.58%

Growth & Income Funds Average 20.55% 22.65% 100.52% 226.62%

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one, five, 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
the fund's return to the performance of the Standard & Poor's 500 Index - a
widely recognized, unmanaged index of common stocks. To measure how the
fund's performance stacked up against its peers, you can compare it to the
growth & income funds average, which reflects the performance of 581 mutual
funds with similar objectives tracked by Lipper Analytical Services, Inc.
over the past six months. These benchmarks reflect reinvestment of
dividends and capital gains, if any, and exclude the effect of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS

Fidelity Growth & Income 21.11% 17.67% 16.47%

S&P 500 26.34% 17.06% 14.53%

Growth & Income Funds Average 22.65% 14.83% 12.47%

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking an arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19970131 19970212 090516 S00000000000001
Growth & Income SP Standard & Poor 500
00027 SP001
1987/01/31 10000.00 10000.00
1987/02/28 10475.23 10395.00
1987/03/31 10789.83 10695.42
1987/04/30 10776.86 10600.23
1987/05/31 10817.24 10692.45
1987/06/30 11214.39 11232.42
1987/07/31 11836.17 11801.90
1987/08/31 12073.71 12242.11
1987/09/30 11978.69 11974.01
1987/10/31 9482.79 9394.81
1987/11/30 8975.97 8620.68
1987/12/31 9437.56 9276.71
1988/01/31 10029.28 9667.26
1988/02/29 10561.08 10117.75
1988/03/31 10334.27 9805.11
1988/04/30 10500.71 9913.95
1988/05/31 10636.89 10000.20
1988/06/30 11128.56 10459.21
1988/07/31 11120.92 10419.47
1988/08/31 10991.08 10065.20
1988/09/30 11389.13 10493.98
1988/10/31 11612.75 10785.71
1988/11/30 11443.11 10631.48
1988/12/31 11606.08 10817.53
1989/01/31 12332.93 11609.37
1989/02/28 12200.07 11320.30
1989/03/31 12577.10 11584.06
1989/04/30 13113.30 12185.28
1989/05/31 13728.35 12678.78
1989/06/30 13822.72 12606.51
1989/07/31 14752.72 13744.88
1989/08/31 15070.66 14014.28
1989/09/30 14989.73 13956.82
1989/10/31 14516.11 13633.02
1989/11/30 14757.08 13911.13
1989/12/31 15041.66 14245.00
1990/01/31 14253.22 13289.16
1990/02/28 14472.23 13460.59
1990/03/31 14726.43 13817.30
1990/04/30 14346.57 13471.87
1990/05/31 15406.66 14785.37
1990/06/30 15335.06 14684.83
1990/07/31 15228.19 14637.84
1990/08/31 13928.01 13314.58
1990/09/30 13124.89 12666.16
1990/10/31 13097.54 12611.70
1990/11/30 13744.67 13426.41
1990/12/31 14019.36 13801.01
1991/01/31 15299.71 14402.73
1991/02/28 16589.27 15432.53
1991/03/31 17503.08 15805.99
1991/04/30 17744.12 15843.93
1991/05/31 18763.90 16528.39
1991/06/30 17489.48 15771.39
1991/07/31 18561.03 16506.33
1991/08/31 19101.46 16897.53
1991/09/30 18932.98 16615.34
1991/10/31 19271.59 16837.99
1991/11/30 18265.44 16159.42
1991/12/31 19885.30 18008.06
1992/01/31 20360.84 17673.11
1992/02/29 20807.27 17902.86
1992/03/31 20379.88 17553.75
1992/04/30 20838.19 18069.83
1992/05/31 20916.20 18158.37
1992/06/30 20505.16 17887.81
1992/07/31 20926.83 18619.43
1992/08/31 20711.09 18237.73
1992/09/30 20923.23 18452.93
1992/10/31 21088.93 18517.52
1992/11/30 21740.71 19148.96
1992/12/31 22179.37 19384.50
1993/01/31 22798.28 19547.33
1993/02/28 23057.09 19813.17
1993/03/31 23903.33 20231.23
1993/04/30 23869.38 19741.63
1993/05/31 24367.36 20270.71
1993/06/30 24742.56 20329.49
1993/07/31 24924.66 20248.18
1993/08/31 25903.44 21015.58
1993/09/30 26044.44 20853.76
1993/10/31 26335.90 21285.43
1993/11/30 25741.33 21083.22
1993/12/31 26510.85 21338.33
1994/01/31 27513.06 22063.83
1994/02/28 26988.09 21465.90
1994/03/31 25800.86 20529.99
1994/04/30 26316.16 20792.77
1994/05/31 26400.05 21133.77
1994/06/30 25941.84 20616.00
1994/07/31 26688.20 21292.20
1994/08/31 27711.43 22165.18
1994/09/30 27389.69 21622.14
1994/10/31 27716.06 22108.63
1994/11/30 26686.75 21303.44
1994/12/31 27111.88 21619.37
1995/01/31 27433.27 22179.96
1995/02/28 28243.15 23044.31
1995/03/31 29131.96 23724.35
1995/04/30 29945.48 24423.03
1995/05/31 30797.75 25399.22
1995/06/30 31353.60 25989.24
1995/07/31 32546.54 26851.05
1995/08/31 32792.91 26918.44
1995/09/30 34111.49 28054.40
1995/10/31 33951.72 27954.25
1995/11/30 35549.44 29181.44
1995/12/31 36704.67 29743.47
1996/01/31 37925.90 30755.94
1996/02/29 38346.55 31041.05
1996/03/31 38672.78 31339.97
1996/04/30 39067.68 31801.92
1996/05/31 39816.63 32622.09
1996/06/30 40062.39 32746.38
1996/07/31 38532.04 31299.65
1996/08/31 39133.25 31959.76
1996/09/30 41198.89 33758.45
1996/10/31 41852.84 34689.51
1996/11/30 44497.07 37311.69
1996/12/31 44054.57 36572.55
1997/01/31 45932.59 38857.60
IMATRL PRASUN SHR__CHT 19970131 19970212 090519 R00000000000123

$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was invested
in Fidelity Growth & Income Portfolio on January 31, 1987. As the chart
shows, by January 31, 1997, the value of the investment would have grown to
$45,933 - a 359.33% increase on the initial investment. For comparison,
look at how the S&P 500 did over the same period. With dividends and
capital gains, if any, reinvested, the same $10,000 investment would have
grown to $38,858 - a 288.58% 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 or 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)
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Steven Kaye, Portfolio Manager of Fidelity Growth &
Income Portfolio
Q. STEVE, HOW HAS THE FUND PERFORMED?
A. For the six months that ended January 31, 1997, the fund had a total
return of 19.21%, while the growth & income funds average tracked by Lipper
Analytical Services returned 20.55%, and the Standard & Poor's 500 Index
posted a return of 24.15%. For the 12 months that ended January 31, 1997,
the fund returned 21.11%, the growth & income funds average returned 22.65%
and the S&P 500 returned 26.34%.
Q. WHAT FACTORS CAUSED THE FUND TO LAG THE LIPPER AVERAGE AND THE S&P 500
OVER THE PAST SIX MONTHS?
A. There were several reasons. First, the fund had less invested in
technology stocks than the index, and other funds probably held more
technology investments as well. This was the top performing sector in the
market in 1996, driven by the outstanding performance of the larger
technology-related companies such as Microsoft. While the fund invested in
some of these companies, such as Intel, I believed that many technology
stocks were too expensive. Second, the finance sector posted positive
performance, but I believed that most of these stocks were trading at very
expensive levels relative to their valuation histories, so I didn't
increase the fund's investments in them. Finally, while the fund's tobacco
investments - such as its holdings in
UST and Philip Morris - were at or near all-time highs toward the end of
the period, an adverse decision in a lawsuit in August caused share-price
drops in those stocks, hurting the fund's six-month performance.
Q. WHAT WAS THE INVESTING ENVIRONMENT LIKE OVER THE PERIOD?
A. The market exhibited strong performance that came from a select few
names. This narrow, often volatile market saw valuations reach toward
record highs. Part of the reason behind the market's advance was the
positive backdrop of low interest rates and controlled inflation. This good
economic news, combined with huge inflows of investor dollars into the
market, kept driving stock prices upward. But, again, most of the gains
were achieved by a small number of stocks, mainly those of the largest
companies.
Q. WHAT SORT OF STRATEGY DID YOU PURSUE IN THIS ENVIRONMENT?
A. I didn't follow any broad themes, really. I'm a bottom-up investor - I
evaluate the merits of individual companies instead
of looking first at sectors or economic trends. That being said, one of the
fund's largest positions was in the health care sector, specifically in
pharmaceutical stocks. Many of these companies had solid business prospects
driven by strong prescription growth and the introduction of new products.
I didn't choose these investments because they were drug stocks but because
their business prospects were positive, their earnings growth was
accelerating and there was strong demand for their products. While these
stocks' valuations were reaching higher levels, I was comfortable owning
them because of their positive business prospects. I also remained
attracted to companies involved in defense and aerospace because of the
consolidation in the industry, and the strong free cash flow offered by the
companies in the industry that remained after that consolidation activity.
Q. WHICH STOCKS WERE PARTICULARLY SUCCESSFUL FOR THE FUND?
A. The fund's retail stocks were positive contributors, especially drug
store stocks, including Rite Aid, CVS and Revco, which CVS has been
attempting to acquire. Among the retailers, these companies posted strong
earnings growth and the best comparable store sales - this year's results
for each store compared to last year's. The drug store chains gained market
share as a result of the trend toward managed care in the health industry.
Because the big drug store chains have the ability to contract with managed
care organizations, they can offer prescription services throughout an
entire region at an attractive total cost. With more people coming in the
door for their prescriptions, the stores can sell more of the other
products they offer. Another positive contributor to the fund was its stake
in REITs - real estate investment trusts. Supply and demand among various
property types continued to improve in 1996, as demand outpaced supply.
Additionally, investors were attracted to REITs by their dividend yields,
which typically were about three or four times more than the stock market
average.
Q. WHAT'S YOUR OUTLOOK AT THE START OF 1997?
A. I spend a lot of time looking at stocks' historical valuations. With
that perspective, I find today's stock market environment different from
anything we've seen historically. The questions at this point are: Does
history repeat itself? Will we see sharp stock price declines? Stock prices
have increased faster than company earnings over the past year, and history
indicates that at some point prices should fall to more accurately reflect
company earnings. It's quite possible that earnings will not be that
stellar in 1997; we're well into an economic recovery and the positive
currency backdrop that was like a wind at the backs of many stocks in the
S&P 500 in early 1996 may not be as favorable. There's another point to
consider. We've seen the dollar rally versus European and Asian currencies
recently, which could cause some earnings problems this year. The dollar's
rally hurts in two ways. First, with a stronger dollar, overseas sales
translate into fewer dollars after exchange. Second, U.S. companies become
less cost competitive overseas. At this point, the economy is doing fine,
but it's impossible to predict whether or not that will continue. With the
possibility of earnings disappointments on the horizon, I'll continue to do
what I always do: look at stocks one at a time, searching for attractively
valued stocks of companies with positive business prospects.
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 a high total
return through a combination
of current income and capital
appreciation
FUND NUMBER: 027
TRADING SYMBOL: FGRIX
START DATE: December 30,
1985
SIZE: as of January 31,
1997, more than $25.4 billion
MANAGER: Steven Kaye,
since 1993; manager, Fidelity
Blue Chip Growth Fund,
1990-1992; Fidelity Select
Energy Services,
Biotechnology, and Health
Care Portfolios, 1986-1990;
joined Fidelity in 1985
(checkmark)
STEVE KAYE ON BUYING AND
SELLING STOCKS:
"When deciding whether or
not to buy a stock, I look first
at its valuation. I ask myself
whether the valuation is
attractive relative to its
historical range given today's
market environment. Second,
I examine the company's
earnings growth outlook. I
don't want to buy a cheap
stock of a company that's not
going to grow its earnings, so
I examine the stock's
valuation relative to its
earnings outlook. Finally, I
`kick the tires.' That is, I visit
with the company's
management to get a final feel
for the prospects of the
company. Once a stock
meets my approval through
these three steps, I'll buy it.
"I'll sell a stock if the company
has a change in its business
prospects or it reaches what
I consider to be an
excessive valuation. If I'm
disappointed in the
company's ability to fulfill its
business potential, I'll get rid
of the stock. I'll also sell the
stock to take profits if the
company does well and its
success is reflected in a nice
increase in the stock price,
bringing it to what I consider
full valuation."
INVESTMENT CHANGES

TOP TEN STOCKS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

Philip Morris Companies, Inc. 3.2 3.9

General Electric Co. 3.0 3.1

Bristol-Myers Squibb Co. 2.0 1.2

Royal Dutch Petroleum Co. ADR 2.0 2.0

American Express Co. 2.0 1.7

Intel Corp. 1.8 0.2

British Petroleum PLC ADR 1.7 1.7

Federal National Mortgage Association 1.7 1.8

Procter & Gamble Co. 1.4 0.5

Tyco International Ltd. 1.2 1.1

TOP FIVE MARKET SECTORS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET
SECTORS
6 MONTHS AGO

Health 15.0 15.3

Finance 12.7 11.0

Nondurables 9.4 10.6

Technology 8.9 6.3

Energy 7.3 7.4

ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JANUARY 31, 1997 * AS OF JULY 31, 1996 **
Row: 1, Col: 1, Value: 5.8
Row: 1, Col: 2, Value: 1.2
Row: 1, Col: 3, Value: 93.0
Stocks 90.4%
Bonds 1.0%
Short-term
investments 8.6%
FOREIGN
INVESTMENTS 7.7%
Stocks 93.0%
Bonds 1.2%
Short-term
investments 5.8%
FOREIGN
INVESTMENTS 7.3%
Row: 1, Col: 1, Value: 8.6
Row: 1, Col: 2, Value: 1.0
Row: 1, Col: 3, Value: 90.40000000000001
*
**

INVESTMENTS JANUARY 31, 1997 (UNAUDITED)

Showing Percentage of Total Value of Investment in Securities

COMMON STOCKS - 92.7%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 5.3%
AEROSPACE & DEFENSE - 3.6%
Boeing Co. 1,112,820 $ 119,211
British Aerospace PLC 2,471,644 50,207
Gulfstream Aerospace Corp. (a) 1,281,200 29,628
Lockheed Martin Corp. 3,069,305 282,376
McDonnell Douglas Corp. 2,620,600 176,235
Northrop Grumman Corp. 1,791,600 139,969
Rockwell International Corp. 1,624,300 106,798
904,424
DEFENSE ELECTRONICS - 1.1%
Litton Industries, Inc. (a)(d) 2,448,200 110,169
Raytheon Co. 3,690,500 169,302
279,471
SHIP BUILDING & REPAIR - 0.6%
General Dynamics Corp. 2,184,600 154,287
TOTAL AEROSPACE & DEFENSE 1,338,182
BASIC INDUSTRIES - 6.0%
CHEMICALS & PLASTICS - 3.5%
Air Products & Chemicals, Inc. 1,659,700 118,461
Cytec Industries, Inc. (a) 900,000 35,888
du Pont (E.I.) de Nemours & Co. 1,154,600 126,573
Ethyl Corp. 1,886,900 16,510
Ferro Corp. 1,214,000 36,116
Grace (W.R.) & Co. 1,402,200 69,759
IMC Global, Inc. 362,100 13,805
Monsanto Co. 2,400,000 90,900
Morton International, Inc. 300,000 12,188
Praxair, Inc. 3,825,000 177,384
Raychem Corp. 706,100 61,166
Schulman (A.), Inc. 1,325,500 27,670
Union Carbide Corp. 2,065,600 93,727
880,147
IRON & STEEL - 0.1%
Nucor Corp. 334,900 17,415
METALS & MINING - 0.2%
Aluminum Co. of America 813,600 56,138
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
BASIC INDUSTRIES - CONTINUED
PACKAGING & CONTAINERS - 1.0%
Corning, Inc. 3,642,800 $ 129,775
Crown Cork & Seal Co., Inc. 36,200 2,082
Tupperware Corp. 2,583,400 121,097
252,954
PAPER & FOREST PRODUCTS - 1.2%
Champion International Corp. 300,000 12,563
International Paper Co. 350,000 14,306
Kimberly-Clark Corp. 2,723,900 265,580
Willamette Industries, Inc. 399,400 25,112
317,561
TOTAL BASIC INDUSTRIES 1,524,215
CONGLOMERATES - 2.9%
AlliedSignal, Inc. 2,639,000 185,390
American Standard Companies, Inc. (a) 1,662,800 67,551
Tyco International Ltd. 5,316,609 303,711
United Technologies Corp. 960,400 66,988
Whitman Corp. 4,670,200 107,415
731,055
CONSTRUCTION & REAL ESTATE - 2.1%
BUILDING MATERIALS - 0.1%
Sherwin-Williams Co. 520,200 28,871
REAL ESTATE - 0.1%
Rouse Co. (The) 1,076,900 33,384
REAL ESTATE INVESTMENT TRUSTS - 1.9%
Bay Apartment Communities, Inc. 411,900 14,828
Beacon Properties Corp. 1,906,200 68,147
CBL & Associates Properties, Inc. (d) 1,957,100 50,151
Cali Realty Corp. 875,900 28,905
Carr Realty Corp. 185,100 5,391
Crescent Real Estate Equities, Inc. 823,000 44,133
Duke Realty Investors, Inc. 424,353 16,815
Equity Residential Properties Trust (SBI) 2,203,685 94,758
Highwoods Properties, Inc. 480,500 16,818
Irvine Apartment Communities, Inc. 191,400 5,096
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONSTRUCTION & REAL ESTATE - CONTINUED
REAL ESTATE INVESTMENT TRUSTS - CONTINUED
Liberty Property Trust (SBI) 888,200 $ 22,871
Macerich Co. 647,600 17,809
Manufactured Home Communities, Inc. 526,100 12,429
Public Storage, Inc. 1,685,500 49,301
Speiker Properties, Inc. 270,500 9,467
Urban Shopping Centers, Inc. 666,400 20,159
477,078
TOTAL CONSTRUCTION & REAL ESTATE 539,333
DURABLES - 3.4%
AUTOS, TIRES, & ACCESSORIES - 1.4%
Chrysler Corp. 548,600 19,132
Eaton Corp. 726,400 50,848
General Motors Corp. 2,687,638 158,571
Scania AB Class B 893,500 22,552
Volvo AB Class B 3,800,000 90,671
341,774
CONSUMER DURABLES - 0.7%
Minnesota Mining & Manufacturing Co. 1,978,300 168,650
CONSUMER ELECTRONICS - 0.3%
Newell Co. 2,547,500 84,068
TEXTILES & APPAREL - 1.0%
Fruit of the Loom, Inc. Class A (a)(d) 4,111,800 164,986
Intimate Brands, Inc. Class A 888,300 15,767
Liz Claiborne, Inc. 323,800 13,640
Unifi, Inc. 2,070,600 63,153
257,546
TOTAL DURABLES 852,038
ENERGY - 7.3%
ENERGY SERVICES - 1.5%
Baker Hughes, Inc. 835,100 32,569
Dresser Industries, Inc. 1,000,300 33,885
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
ENERGY - CONTINUED
ENERGY SERVICES - CONTINUED
Schlumberger Ltd. 2,010,700 $ 223,439
Western Atlas, Inc. (a) 1,287,000 87,355
377,248
OIL & GAS - 5.8%
Amoco Corp. 468,200 40,733
Anadarko Petroleum Corp. 471,100 30,504
British Petroleum PLC ADR 3,072,510 435,144
Chevron Corp. 650,400 43,170
Kerr-McGee Corp. 489,900 33,681
Mobil Corp. 485,800 63,761
Occidental Petroleum Corp. 2,319,400 59,145
Royal Dutch Petroleum Co. ADR 2,927,900 507,991
Tosco Corp. 647,200 57,277
Total SA:
Class B 140,000 12,045
sponsored ADR 1,022,477 44,094
USX-Marathon Group 936,000 24,921
Union Pacific Resources Group, Inc. 2,501,869 70,991
Unocal Corp. 1,273,591 53,650
1,477,107
TOTAL ENERGY 1,854,355
FINANCE - 12.6%
BANKS - 3.5%
Bank of New York Co., Inc. 5,038,254 184,526
BankAmerica Corp. 274,200 30,607
Barnett Banks, Inc. 593,900 26,132
Citicorp 2,495,000 290,356
CoreStates Financial Corp. 800,000 39,800
Fleet Financial Group, Inc. 1,746,299 94,300
National City Corp. 2,644,833 120,009
Norwest Corp. 2,382,300 113,457
899,187
CREDIT & OTHER FINANCE - 2.6%
American Express Co. 8,132,130 507,242
Associates First Capital Corp. 529,600 25,752
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - CONTINUED
CREDIT & OTHER FINANCE - CONTINUED
Beneficial Corp. 575,000 $ 38,669
First Chicago NBD Corp. 343,600 19,628
Household International, Inc. 815,582 80,844
672,135
FEDERAL SPONSORED CREDIT - 3.5%
Federal Home Loan Mortgage Corporation 5,523,200 167,077
Federal National Mortgage Association 10,984,000 433,868
Student Loan Marketing Association 2,667,300 290,402
891,347
INSURANCE - 2.6%
Allmerica Financial Corp. 1,150,700 42,144
Allstate Corp. 2,023,010 133,013
General Re Corp. 545,400 88,082
ITT Hartford Group, Inc. 2,249,100 165,028
MBIA, Inc. 1,195,100 114,879
PMI Group, Inc. 312,300 16,318
Providian Corp. 319,000 17,186
Travelers Group, Inc. (The) 1,152,665 60,371
UNUM Corp. 341,300 25,811
662,832
SECURITIES INDUSTRY - 0.4%
Lehman Brothers Holdings, Inc. 2,866,520 90,654
TOTAL FINANCE 3,216,155
HEALTH - 14.7%
DRUGS & PHARMACEUTICALS - 9.1%
Allergan, Inc. 3,030,000 107,186
American Home Products Corp. 2,715,000 172,063
Astra AB Class A Free shares 1,550,000 73,862
Bristol-Myers Squibb Co. 4,080,700 518,249
Genentech, Inc. special (a)(d) 2,272,300 124,692
Lilly (Eli) & Co. 2,848,866 248,207
Merck & Co., Inc. 2,425,000 220,069
Pfizer, Inc. 2,846,600 264,378
Pharmacia & Upjohn, Inc. 468,350 17,446
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
DRUGS & PHARMACEUTICALS - CONTINUED
Schering-Plough Corp. 1,330,300 $ 100,604
SmithKline Beecham PLC ADR 3,009,700 217,451
Warner-Lambert Co. 3,303,160 265,904
2,330,111
MEDICAL EQUIPMENT & SUPPLIES - 4.0%
Allegiance Corp. 2,520,520 64,588
Bard (C.R.), Inc. 998,600 28,210
Bausch & Lomb, Inc. (d) 3,259,900 110,429
Baxter International, Inc. 3,374,600 155,653
Beckman Instruments, Inc. 750,000 29,625
Becton, Dickinson & Co. 2,504,500 123,347
Biomet, Inc. 2,322,100 35,993
Boston Scientific Corp. (a) 360,895 24,631
Guidant Corp. 298,825 16,659
Johnson & Johnson 2,680,600 154,470
Medtronic, Inc. 1,061,200 72,692
Nellcor, Inc. (a) 529,400 9,000
Pall Corp. 2,846,100 63,681
St. Jude Medical, Inc. (a) 1,365,550 51,720
Stryker Corp. 2,488,900 72,178
U.S. Surgical Corp. 150,000 6,019
1,018,895
MEDICAL FACILITIES MANAGEMENT - 1.6%
Columbia/HCA Healthcare Corp. 1,763,466 69,657
Coram Healthcare Corp. (a) 1,492,500 8,022
Covance, Inc. (a) 802,875 15,154
FHP International Corp. (a) 722,500 26,191
Fresenius Medical Care AG sponsored ADR (a) 42,035 1,251
Integrated Health Services, Inc. 291,900 7,772
Quest Diagnostics, Inc. (a) 401,437 6,323
Tenet Healthcare Corp. (a) 7,486,100 202,125
United HealthCare Corp. 1,212,400 59,105
395,600
TOTAL HEALTH 3,744,606
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HOLDING COMPANIES - 0.3%
Norfolk Southern Corp. 368,600 $ 32,667
U.S. Industries, Inc. (a) 1,423,460 48,220
80,887
INDUSTRIAL MACHINERY & EQUIPMENT - 5.1%
ELECTRICAL EQUIPMENT - 4.4%
Alcatel Alsthom Compagnie Generale d'Electricite SA 888,576 88,014
American Superconductor Corp. (a) 304,750 3,276
Emerson Electric Co. 869,300 85,843
General Electric Co. 7,328,200 754,805
General Instrument Corp. (a) 486,200 12,094
Oak Industries, Inc. (a)(d) 1,464,700 32,040
Scientific-Atlanta, Inc. 291,000 5,529
Sensormatic Electronics Corp. 1,414,000 23,154
Westinghouse Electric Corp. 6,706,635 123,234
1,127,989
INDUSTRIAL MACHINERY & EQUIPMENT - 0.2%
Stanley Works 1,066,100 40,512
POLLUTION CONTROL - 0.5%
Browning-Ferris Industries, Inc. 728,600 23,680
WMX Technologies, Inc. 3,022,700 110,706
134,386
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 1,302,887
MEDIA & LEISURE - 2.7%
BROADCASTING - 0.2%
HSN, Inc. (a) 1,214,825 24,600
Jacor Communications, Inc. Class A (a) 1,206,600 31,975
56,575
ENTERTAINMENT - 0.4%
Disney (Walt) Co. 1,241,800 90,962
Viacom, Inc. Class B (non-vtg.) (a) 500,000 17,125
108,087
LODGING & GAMING - 0.9%
ITT Corp. (a) 2,912,600 166,382
Mirage Resorts, Inc. (a) 2,236,400 56,190
222,572
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - CONTINUED
PUBLISHING - 1.2%
ACNielsen Corp. (a) 841,332 $ 13,777
Cognizant Corp. 3,432,600 110,272
Dun & Bradstreet Corp. 3,169,900 76,078
Times Mirror Co. Class A 2,097,900 99,126
299,253
RESTAURANTS - 0.0%
Brinker International, Inc. (a) 155,000 1,686
Starbucks Corp. (a) 265,900 9,107
10,793
TOTAL MEDIA & LEISURE 697,280
NONDURABLES - 9.4%
AGRICULTURE - 0.1%
Pioneer Hi-Bred International, Inc. 363,100 24,464
BEVERAGES - 1.4%
Anheuser-Busch Companies, Inc. 2,040,000 86,700
PepsiCo, Inc. 7,834,000 273,211
359,911
FOODS - 1.6%
General Mills, Inc. 1,306,300 88,502
Kellogg Co. 478,000 33,281
Nestle SA (Reg.) 20,000 21,687
Quaker Oats Co. 332,100 12,744
RalCorp Holdings, Inc. (a) 661,766 15,221
Ralston Purina Co. 1,413,507 111,137
Sysco Corp. 2,692,900 88,529
Tyson Foods, Inc. 1,035,200 35,067
406,168
HOUSEHOLD PRODUCTS - 3.0%
Avon Products, Inc. 1,120,600 70,318
Dial Corp. 1,511,800 20,787
Gillette Co. 818,120 66,677
Premark International, Inc. 1,500,700 34,516
Procter & Gamble Co. 3,101,300 358,200
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONDURABLES - CONTINUED
HOUSEHOLD PRODUCTS - CONTINUED
Rubbermaid, Inc. 2,122,700 $ 49,087
Unilever NV ADR 917,600 150,945
750,530
TOBACCO - 3.3%
Philip Morris Companies, Inc. 6,792,100 807,411
RJR Nabisco Holdings Corp. 245,746 8,048
UST, Inc. 948,100 29,154
844,613
TOTAL NONDURABLES 2,385,686
PRECIOUS METALS - 0.1%
Newmont Mining Corp. 719,500 28,690
RETAIL & WHOLESALE - 5.5%
APPAREL STORES - 0.6%
Footstar, Inc. (a) 514,793 11,647
Limited, Inc. (The) 3,611,000 61,838
Payless ShoeSource, Inc. (a) 1,113,668 41,763
TJX Companies, Inc. 702,700 27,932
143,180
DRUG STORES - 1.3%
CVS Corp. 1,817,400 78,603
Revco (D.S.), Inc. (a) 2,429,693 91,113
Rite Aid Corp. 2,305,440 92,218
Walgreen Co. 1,663,300 68,403
330,337
GENERAL MERCHANDISE STORES - 1.6%
Carson Pirie Scott & Co. (a)(d) 1,644,874 44,000
Federated Department Stores, Inc. (a) 1,628,430 53,535
May Department Stores Co. (The) 805,200 35,831
Price/Costco, Inc. (a) 1,484,200 39,517
Wal-Mart Stores, Inc. 10,108,100 240,067
412,950
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
GROCERY STORES - 0.9%
Ahold NV 202,000 $ 12,458
American Stores Co. 900,000 37,800
Kroger Co. (The) (a) 2,301,326 109,888
Safeway, Inc. (a) 1,717,700 82,020
242,166
RETAIL & WHOLESALE, MISCELLANEOUS - 1.1%
Corporate Express, Inc. (a) 787,500 17,719
Home Depot, Inc. (The) 3,806,700 188,432
Staples, Inc. (a) 1,086,100 22,265
Toys "R" Us, Inc. (a) 1,117,200 27,930
Viking Office Products, Inc. (a) 479,900 13,317
269,663
TOTAL RETAIL & WHOLESALE 1,398,296
SERVICES - 1.2%
ADVERTISING - 0.1%
Omnicom Group, Inc. 477,700 23,228
PRINTING - 0.2%
Deluxe Corp. 265,900 8,176
Donnelley (R.R.) & Sons Co. 1,042,700 32,584
Valassis Communications, Inc. (a) 704,200 12,940
53,700
SERVICES - 0.9%
ADT Ltd. (a) 1,875,200 41,958
Block (H&R), Inc. 3,474,100 102,920
Jostens, Inc. (d) 2,878,700 59,373
Service Corp. International 1,131,900 32,825
237,076
TOTAL SERVICES 314,004
TECHNOLOGY - 8.8%
COMMUNICATIONS EQUIPMENT - 0.8%
Cisco Systems, Inc. (a) 2,059,000 143,615
Lucent Technologies, Inc. 1,079,976 58,589
202,204
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - 2.6%
Automatic Data Processing, Inc. 2,555,200 $ 105,721
CUC International, Inc. (a) 1,498,800 37,095
Ceridian Corp. (a) 1,920,500 72,499
DST Systems, Inc. (a) 1,467,300 47,871
Electronic Data Systems Corp. 4,876,700 224,328
Electronics for Imaging, Inc. (a) 321,800 29,847
First Data Corp. 2,550,000 91,800
Information Resources, Inc. (a) 1,317,778 20,426
NCR Corp. (a) 865,000 32,762
662,349
COMPUTERS & OFFICE EQUIPMENT - 2.2%
Adaptec, Inc. (a) 1,224,200 53,559
Bay Networks, Inc. (a) 400,000 8,700
EMC Corp. (a) 500,000 18,938
International Business Machines Corp. 1,635,000 257,104
Pitney Bowes, Inc. 3,403,500 196,127
Silicon Graphics, Inc. (a) 792,800 21,703
556,131
ELECTRONIC INSTRUMENTS - 0.2%
Perkin-Elmer Corp. 653,300 45,649
ELECTRONICS - 2.4%
AMP, Inc. 278,100 11,333
Avnet, Inc. 316,700 19,596
Intel Corp. 2,875,000 466,469
Motorola, Inc. 600,000 40,950
Texas Instruments, Inc. 635,000 49,768
Thomas & Betts Corp. 776,198 36,384
624,500
PHOTOGRAPHIC EQUIPMENT - 0.6%
Eastman Kodak Co. 1,178,600 102,244
Polaroid Corp. 879,300 38,689
140,933
TOTAL TECHNOLOGY 2,231,766
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TRANSPORTATION - 1.0%
AIR TRANSPORTATION - 0.4%
AMR Corp. (a) 593,400 $ 47,769
Southwest Airlines Co. 1,016,200 22,356
Viad Corp. 3,085,300 48,593
118,718
RAILROADS - 0.6%
Burlington Northern Santa Fe Corp. 982,519 85,970
CSX Corp. 1,225,800 59,451
145,421
TOTAL TRANSPORTATION 264,139
UTILITIES - 4.3%
CELLULAR - 0.0%
360 Degrees Communications Co. (a) 500 10
ELECTRIC UTILITY - 0.6%
Allegheny Power System, Inc. 257,800 7,895
American Electric Power Co., Inc. 411,300 17,018
Duke Power Co. 200,000 9,375
Entergy Corp. 2,115,300 56,849
Texas Utilities Co. 167,400 6,780
Veba AG Ord. 900,000 49,628
147,545
GAS - 0.0%
Consolidated Natural Gas Co. 234,200 13,027
TELEPHONE SERVICES - 3.7%
Ameritech Corp. 2,740,100 163,721
BCE, Inc. 306,000 15,413
Bell Atlantic Corp. 1,206,300 81,124
BellSouth Corp. 500,000 22,188
Cincinnati Bell, Inc. 364,300 22,541
Frontier Corp. 15,300 335
GTE Corp. 2,281,100 107,212
MCI Communications Corp. 2,144,200 75,315
NYNEX Corp. 2,550,500 129,119
Pacific Telesis Group 1,734,700 68,087
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - CONTINUED
TELEPHONE SERVICES - CONTINUED
SBC Communications, Inc. 3,364,700 $ 184,638
WorldCom, Inc. (a) 2,596,800 65,245
934,938
TOTAL UTILITIES 1,095,520
TOTAL COMMON STOCKS
(Cost $16,881,629) 23,599,094
CONVERTIBLE PREFERRED STOCKS - 0.3%
ENERGY - 0.0%
OIL & GAS - 0.0%
Tosco Financing Trust $2.875 (e) 115,000 6,325
FINANCE - 0.0%
SECURITIES INDUSTRY - 0.0%
Salomon, Inc. $3.484 106,000 6,493
INDUSTRIAL MACHINERY & EQUIPMENT - 0.2%
ELECTRICAL EQUIPMENT - 0.2%
Loral Space & Communications Ltd. $3.00 (e) 727,000 39,530
NONDURABLES - 0.0%
TOBACCO - 0.0%
RJR Nabisco Holdings Corp. depositary shares $.6012 1,825,500 12,094
RETAIL & WHOLESALE - 0.1%
APPAREL STORES - 0.1%
TJX Companies, Inc., Series E, $7.00 72,000 15,480
TOTAL CONVERTIBLE PREFERRED STOCKS
(Cost $73,064) 79,922
CORPORATE BONDS - 0.6%
MOODY'S PRINCIPAL VALUE (NOTE 1)
RATINGS (C) AMOUNT (000S) (000S)
CONVERTIBLE BONDS - 0.3%
CONSTRUCTION & REAL ESTATE - 0.0%
REAL ESTATE INVESTMENT TRUSTS - 0.0%
Liberty Property 8%, 7/1/01 B1 $ 1,591 $ 2,036
HEALTH - 0.2%
DRUGS & PHARMACEUTICALS - 0.2%
Roche Holdings, Inc. liquid yield option
notes 0%, 4/20/10 (e) - 72,400 34,028
MEDIA & LEISURE - 0.0%
BROADCASTING - 0.0%
Home Shopping Network, Inc.
5 7/8%, 3/1/06 (e) B- 4,321 4,224
RETAIL & WHOLESALE - 0.0%
GROCERY STORES - 0.0%
Food Lion, Inc. 5%, 6/1/03 (e) Baa1 6,700 7,521
TECHNOLOGY - 0.1%
ELECTRONICS - 0.1%
National Semiconductor Corp.
6 1/2%, 10/1/02 (e) Ba2 31,640 31,996
TOTAL CONVERTIBLE BONDS 79,805
NONCONVERTIBLE BONDS - 0.3%
DURABLES - 0.1%
TEXTILES & APPAREL - 0.1%
Westpoint Stevens, Inc. 8 3/4%, 12/15/01 Ba3 16,910 17,333
FINANCE - 0.1%
ASSET-BACKED SECURITIES - 0.1%
Airplanes Pass Through Trust Class D
10 7/8%, 3/15/19 Ba2 14,530 16,092
CORPORATE BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE (NOTE 1)
RATINGS (C) AMOUNT (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
HEALTH - 0.1%
MEDICAL FACILITIES MANAGEMENT - 0.1%
Tenet Healthcare Corp. 10 1/8%, 3/1/05 Ba3 $ 23,000 $ 25,242
MEDIA & LEISURE - 0.0%
BROADCASTING - 0.0%
SCI Television, Inc. secured 11%, 6/30/05 B2 7,250 7,758
TOTAL NONCONVERTIBLE BONDS 66,425
TOTAL CORPORATE BONDS
(Cost $133,562) 146,230
U.S. TREASURY OBLIGATIONS - 0.6%
8 1/8%, 8/15/19 Aaa 10,000 11,401
6%, 2/15/26 Aaa 172,500 154,279
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $166,452) 165,680
CASH EQUIVALENTS - 5.8%
MATURITY
AMOUNT (000S)
Investments in repurchase agreements
(U.S. Treasury obligations) in a joint
trading account at 5.56%, dated
1/31/97 due 2/3/97 $ 19,993 19,984
SHARES
Taxable Central Cash Fund (b) 1,451,323,821 1,451,324
TOTAL CASH EQUIVALENTS
(Cost $1,471,308) 1,471,308
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $18,726,015) $ 25,462,234
LEGEND
1. Non-income producing
2. At period end, the seven-day yield on the Taxable Central Cash Fund was
5.39%. The yield refers to the income earned by investing in the fund over
the seven-day period, expressed as an annual percentage.
3. Standard & Poor's credit ratings are used in the absence of a rating by
Moody's Investors Service, Inc.
4. Affiliated company (see Note 7 of Notes to Financial Statements).
5. 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 $123,624,000 or 0.5% of net
assets.
INCOME TAX INFORMATION
At January 31, 1997, the aggregate cost of investment securities for income
tax purposes was $18,729,740,000. Net unrealized appreciation aggregated
$6,732,494,000, of which $6,901,255,000 related to appreciated investment
securities and $168,761,000 related to depreciated investment securities.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNT) JANUARY 31, 1997 (UNAUDITED)

ASSETS

Investment in securities, at value (including repurchase $ 25,462,234
agreements of $19,984) (cost $18,726,015) -
See accompanying schedule

Cash 1

Receivable for investments sold 170,334

Receivable for fund shares sold 50,567

Dividends receivable 29,233

Interest receivable 14,130

Other receivables 868

TOTAL ASSETS 25,727,367

LIABILITIES

Payable for investments purchased $ 176,031

Payable for fund shares redeemed 15,118

Accrued management fee 10,292

Other payables and accrued expenses 5,849

Collateral on securities loaned, at value 61,340

TOTAL LIABILITIES 268,630

NET ASSETS $ 25,458,737

Net Assets consist of:

Paid in capital $ 18,592,362

Undistributed net investment income 21,496

Accumulated undistributed net realized gain (loss) on 108,718
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 6,736,161
investments and assets and liabilities in foreign
currencies

NET ASSETS, for 794,585 shares outstanding $ 25,458,737

NET ASSET VALUE, offering price and redemption price per $32.04
share ($25,458,737 (divided by) 794,585 shares)

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS ENDED JANUARY 31, 1997 (UNAUDITED)

INVESTMENT INCOME $ 194,115
Dividends (including $5,375 received from affiliated
issuers)

Interest (including income on securities loaned of $551) 52,953

TOTAL INCOME 247,068

EXPENSES

Management fee $ 56,237

Transfer agent fees 24,180

Accounting and security lending fees 440

Non-interested trustees' compensation 62

Custodian fees and expenses 260

Registration fees 1,213

Audit 78

Legal 52

Miscellaneous 87

Total expenses before reductions 82,609

Expense reductions (1,817) 80,792

NET INVESTMENT INCOME 166,276

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

Investment securities (including realized gain of 210,131
$5,190 on sales of investments in affiliated issuers)

Foreign currency transactions (21) 210,110

Change in net unrealized appreciation (depreciation) on:

Investment securities 3,522,252

Assets and liabilities in foreign currencies (86) 3,522,166

NET GAIN (LOSS) 3,732,276

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 3,898,552
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED JANUARY JULY 31,
31, 1997 1996
(UNAUDITED)

INCREASE (DECREASE) IN NET ASSETS

Operations $ 166,276 $ 288,201
Net investment income

Net realized gain (loss) 210,110 936,554

Change in net unrealized appreciation (depreciation) 3,522,166 1,118,264

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 3,898,552 2,343,019
FROM OPERATIONS

Distributions to shareholders (191,527) (271,415)
From net investment income

From net realized gain (790,988) (453,173)

TOTAL DISTRIBUTIONS (982,515) (724,588)

Share transactions 4,763,955 8,197,294
Net proceeds from sales of shares

Reinvestment of distributions 963,156 707,541

Cost of shares redeemed (2,390,057) (3,423,684)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 3,337,054 5,481,151
FROM SHARE TRANSACTIONS

TOTAL INCREASE (DECREASE) IN NET ASSETS 6,253,091 7,099,582

NET ASSETS

Beginning of period 19,205,646 12,106,064

End of period (including undistributed net investment $ 25,458,737 $ 19,205,646
income of $21,496 and $46,747, respectively)

OTHER INFORMATION
Shares

Sold 159,057 295,617

Issued in reinvestment of distributions 34,043 27,008

Redeemed (79,493) (123,924)

Net increase (decrease) 113,607 198,701

</TABLE>

FINANCIAL HIGHLIGHTS
SIX MONTHS YEARS ENDED JULY 31,
ENDED JANUARY
31, 1997

(UNAUDITED) 1996 1995 1994 E 1993 1992

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

Net asset value, $ 28.20 $ 25.10 $ 22.17 $ 21.90 $ 21.34 $ 19.92
beginning of period

Income from
Investment
Operations

Net investment .22 D .49 .43 .45 .53 .50
income

Net realized and 5.00 3.99 4.14 1.07 3.02 1.94
unrealized gain
(loss)

Total from investment 5.22 4.48 4.57 1.52 3.55 2.44
operations

Less Distributions

From net investment (.26) (.48) (.40) (.48) (.59) (.38)
income

From net (1.12) (.90) (1.24) (.77) (2.40) (.64)
realized gain

Total distributions (1.38) (1.38) (1.64) (1.25) (2.99) (1.02)

Net asset value, end of $ 32.04 $ 28.20 $ 25.10 $ 22.17 $ 21.90 $ 21.34
period

TOTAL RETURN B, C 19.21% 18.39% 21.95% 7.08% 19.10% 12.75%
H H H H H

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of $ 25,459 $ 19,206 $ 12,106 $ 8,757 $ 6,646 $ 4,199
period (in millions)

Ratio of expenses to .73% A .75% .78% .83% .83% .86%
average net assets

Ratio of expenses to .71% A .74% .77% .82% .83% .86%
average net assets , F F F F
after expense
reductions

Ratio of net investment 1.47% A 1.82% 2.21% 2.09% 2.67% 2.49%
income to average
net assets

Portfolio turnover rate 34% A 41% 67% 92% 87% 221%

Average commission $ .0420
rate G

</TABLE>

ANNUALIZED
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).
TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES
OUTSTANDING DURING THE PERIOD.
EFFECTIVE AUGUST 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.
FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 6 OF
NOTES TO FINANCIAL STATEMENTS).
FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE.
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1997 (Unaudited)

12. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Growth & Income Portfolio (the fund) is a fund of Fidelity
Securities Fund (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 financial
statements have been prepared in conformity with generally accepted
accounting principles which permit management to make certain estimates and
assumptions at the date of the financial statements. 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 (including restricted 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 with remaining maturities
of sixty days or less for which quotations are not readily available are
valued at amortized cost or original cost plus accrued interest, both of
which approximate current value.
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. Income receipts
and expense payments are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and
sales of securities are translated into U.S. dollars at the contractual
currency exchange rates established at the time of each trade.
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, 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 that it distributes substantially all of its taxable income for
its fiscal year. The schedule of investments includes information regarding
income taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the funds are informed of the
ex-dividend date. Non-cash dividends included in
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
dividend income, if any, are recorded at the fair market value of the
securities received. Interest income 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.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded 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 litigation
proceeds, foreign currency transactions, market discount, non-taxable
dividends and losses deferred due to wash sales. The fund also utilized
earnings and profits distributed to shareholders on redemption of shares as
a part of the dividends paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income 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.
13. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign-denominated securities.
Losses may arise from changes in the value of the foreign currency or if
the counterparties do not perform under the contracts' terms. The U.S.
dollar value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), 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 for U.S. Treasury or
Federal Agency obligations.
2. OPERATING POLICIES -
CONTINUED
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account, at a bank custodian. The securities are marked-to-market
daily and maintained at a value at least equal to the principal amount of
the repurchase agreement (including accrued interest). FMR, the fund's
investment adviser, is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by the
SEC, the fund may invest in the Taxable Central Cash Fund (the Cash Fund)
managed by FMR Texas, an affiliate of FMR. The Cash Fund is an open-end
money market fund available only to investment companies and other accounts
managed by FMR and its affiliates. The Cash Fund seeks preservation of
capital, liquidity, and current income by investing in U.S. Treasury
securities and repurchase agreements for these securities, and may be
utilized by the fund as an additional cash management option. Dividends
from the Cash Fund are declared daily and paid monthly from net interest
income. Income distributions received by the fund are recorded as interest
income.
RESTRICTED SECURITIES. The fund is permitted to invest in securities that
are subject to legal or contractual restrictions on resale. These
securities generally may be resold in transactions exempt from
registration or to the public if the securities are registered. Disposal of
these securities may involve time-consuming negotiations and expense, and
prompt sale at an acceptable price may be difficult. At the end of the
period, the fund had no investments in restricted securities (excluding
144A issues).
14. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $6,308,779,000 and $3,609,370,000, respectively, of which U.S.
government and government agency obligations aggregated $156,192,000 and
$0, respectively.
15. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR. The
rates ranged from .2500% to .5200% for the period. 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 .20%. For
the period, the management fee was equivalent to an annualized rate of .50%
of average net assets.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
TRANSFER AGENT FEES. Fidelity Service Company, Inc. (FSC), an affiliate of
FMR, is the fund's transfer, dividend disbursing and shareholder servicing
agent. FSC receives account fees and asset-based fees that vary according
to account size and type of account. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annualized rate of
.21% of average net assets.
ACCOUNTING AND SECURITY LENDING FEES. FSC maintains the fund's accounting
records and administers the security lending program. The security lending
fee is based on the number and duration of lending transactions. The
accounting 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 $1,948,000 for the period.
16. SECURITY LENDING.
The fund loaned securities to certain brokers who paid the fund negotiated
lenders' fees. These fees are included in interest income. The fund
receives U.S. Treasury obligations and/or cash as collateral against the
loaned securities, in an amount at least equal to 102% of the market value
of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 100% of the market value of the loaned
securities during the period of the loan. At period end, the value of the
securities loaned and the value of collateral amounted to $59,815,000 and
$61,340,000, respectively.
17. 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
$1,149,000 under this arrangement.
In addition, the fund has entered into arrangements with its custodian and
transfer agent whereby interest earned on uninvested cash balances was used
to offset a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $1,000 and $667,000,
respectively, under these arrangements.
18. 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
DOLLAR AMOUNTS IN THOUSANDS
PURCHASE SALES DIVIDEND VALUE
AFFILIATE COST COST INCOME
Bausch & Lomb, Inc. $ 4,924 $ - $ 1,660 $110,429
CBL & Associates Properties, Inc. 5,148 - 2,213 50,151
Carlisle Plastics, Inc. Class A - - - -
Carson Pirie Scott & Co. - - - 44,000
Ferro Corp. - 7,361 236 -
Fruit of the Loom, Inc. Class A 5,208 12,001 - 164,986
Genentech, Inc. special 1,453 - - 124,692
Jostens, Inc. - - 1,266 59,373
Litton Industries, Inc. 3,534 - - 110,169
Oak Industries, Inc. 12,219 2,498 - 32,040
Valassis Communications, Inc. - 4,914 - -
TOTALS $ 32,486 $ 26,774 $ 5,375 $ 695,840
MANAGING YOUR INVESTMENTS

TO WRITE FIDELITY

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
Steven Kaye, 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 *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
The Chase Manhattan Bank
New York, NY
FIDELITY'S GROWTH AND INCOME FUNDS
Balanced Fund
Convertible Securities Fund
Equity-Income Fund
Equity-Income II Fund
Fidelity Fund
Global Balanced Fund
Growth & Income Portfolio
Market Index Fund
Puritan Fund
Real Estate Investment Portfolio
Utilities Fund
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE

FIDELITY

(registered trademark)
OTC
PORTFOLIO
SEMIANNUAL REPORT
JANUARY 31, 1997
CONTENTS

PRESIDENT'S MESSAGE 3 Ned Johnson on investing
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 22 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.

NOTES 26 Notes to the financial statements.

THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE
PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND MONEY.
PRESIDENT'S MESSAGE

(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
As 1997 begins, the stock and bond markets generally have continued on the
course they followed during the past year. Through January, stocks
maintained their unprecedented climb, with the well-known, blue chip
companies still setting the pace. With low, stable interest rates, the bond
market has tended to mirror its historical returns in the mid-single
digits.
While it's impossible to predict the future direction of the markets with
any degree of certainty, there are certain basic principles that can help
investors plan for their future needs.
First, investors are encouraged to take a long-term view of their
portfolios. If you can afford to leave your money invested through the
inevitable up and down cycles of the financial markets, you will greatly
reduce your vulnerability to any single decline. We know from experience,
for example, that stock prices have gone up over longer periods of time,
have significantly outperformed other types of investments and have stayed
ahead of inflation.
Second, you can further manage your investing risk through diversification.
A stock mutual fund, for instance, is already diversified, because it
invests in many different companies. You can increase your diversification
further by investing in a number of different stock funds, or in such other
investment categories as bonds. It's also advisable to keep money you'll
need in the near future in a more stable investment, traditionally
short-term bond or money market funds.
Finally, no matter what your time horizon or portfolio diversity, it makes
good sense to follow a regular investment plan, investing a certain amount
of money at the same time each month or quarter and periodically reviewing
your overall portfolio. By doing so, you won't get caught up in the
excitement of a rapidly rising market, nor will you buy all your shares at
market highs. While this strategy - known as dollar cost averaging - won't
assure a profit or protect you from a loss in a declining market, it should
help you lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are available
24 hours a day, seven days a week to provide you the information you need
to make the investments that are right for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
PERIODS ENDED JANUARY 31, 1997 PAST 6 PAST 1 PAST 5 PAST 10
MONTHS YEAR YEARS YEARS

Fidelity OTC 25.10% 28.99% 106.61% 343.67%

Fidelity OTC (incl. 3% sales 21.35% 25.12% 100.41% 330.36%
charge)

NASDAQ(registered trademark) Composite Index 28.03% 30.99% 134.04% 299.59%

Mid-Cap Funds Average 18.37% 20.65% 92.16% 269.77%

</TABLE>

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one, five, 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
the fund's returns to the performance of the NASDAQ Composite Index - an
unmanaged index of the National Market System which includes over 5,000
stocks traded only over-the-counter and not on an exchange. To measure how
the fund's performance stacked up against its peers, you can compare it to
the mid-cap funds average, which reflects the performance of 181 mutual
funds with similar objectives tracked by Lipper Analytical Services, Inc.
over the past six months. Unlike most other funds in this category, this
fund invests in large companies as well as small ones. Both benchmarks
reflect reinvestment of dividends and capital gains, if any, and exclude
the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS

Fidelity OTC 28.99% 15.62% 16.07%

Fidelity OTC (incl. 3% sales charge) 25.12% 14.92% 15.71%

NASDAQ Composite Index 30.99% 18.54% 14.86%

Mid-Cap Funds Average 20.65% 13.85% 13.63%

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking the arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19970131 19970210 133512 S00000000000001
OTC Portfolio FI NASDAQ w/Wilshire Divs
00093 F0091
1987/01/31 9700.00 10000.00
1987/02/28 10738.16 10850.79
1987/03/31 10711.95 10991.76
1987/04/30 10591.35 10690.57
1987/05/31 10685.73 10669.80
1987/06/30 10900.70 10890.02
1987/07/31 11425.03 11165.20
1987/08/31 11959.84 11692.01
1987/09/30 11886.43 11429.92
1987/10/31 8305.30 8329.64
1987/11/30 7801.95 7874.85
1987/12/31 8773.50 8540.36
1988/01/31 9085.13 8919.76
1988/02/29 9690.40 9509.53
1988/03/31 9912.14 9721.52
1988/04/30 10211.78 9853.50
1988/05/31 10121.89 9635.98
1988/06/30 10793.08 10281.69
1988/07/31 10757.12 10103.68
1988/08/31 10499.43 9834.92
1988/09/30 10900.95 10139.40
1988/10/31 10894.96 10015.19
1988/11/30 10541.38 9740.01
1988/12/31 10778.63 10013.64
1989/01/31 11473.63 10550.36
1989/02/28 11443.15 10522.57
1989/03/31 11943.06 10721.21
1989/04/30 12528.33 11284.00
1989/05/31 13089.21 11789.76
1989/06/30 13058.72 11516.73
1989/07/31 13631.79 12021.83
1989/08/31 14241.45 12448.00
1989/09/30 14322.76 12558.06
1989/10/31 13839.83 12114.16
1989/11/30 13966.92 12141.45
1989/12/31 14054.52 12122.87
1990/01/31 13056.60 11098.70
1990/02/28 13419.48 11381.97
1990/03/31 13928.91 11657.42
1990/04/30 13524.16 11259.47
1990/05/31 14410.42 12318.03
1990/06/30 14438.33 12423.06
1990/07/31 14249.91 11792.66
1990/08/31 13021.71 10273.85
1990/09/30 12305.07 9300.31
1990/10/31 12045.56 8919.94
1990/11/30 12881.76 9725.76
1990/12/31 13386.76 10141.63
1991/01/31 14440.95 11251.98
1991/02/28 15560.13 12322.85
1991/03/31 16433.80 13133.85
1991/04/30 16404.92 13215.26
1991/05/31 17206.39 13813.84
1991/06/30 16376.04 13005.31
1991/07/31 17531.32 13734.63
1991/08/31 18455.54 14397.07
1991/09/30 18293.35 14445.56
1991/10/31 19088.72 14902.74
1991/11/30 18186.29 14394.64
1991/12/31 19967.62 16125.94
1992/01/31 20829.82 17073.52
1992/02/29 20870.11 17454.83
1992/03/31 20201.30 16652.69
1992/04/30 19605.01 15977.03
1992/05/31 19887.04 16176.51
1992/06/30 19451.91 15592.99
1992/07/31 19862.87 16086.16
1992/08/31 19371.33 15612.18
1992/09/30 19969.22 16187.14
1992/10/31 20713.36 16811.71
1992/11/30 22175.38 18150.01
1992/12/31 22950.74 18840.57
1993/01/31 23102.85 19397.35
1993/02/28 22199.13 18702.19
1993/03/31 22968.63 19259.30
1993/04/30 22297.56 18475.63
1993/05/31 22897.05 19586.04
1993/06/30 22923.89 19699.70
1993/07/31 23174.43 19739.10
1993/08/31 23603.92 20826.15
1993/09/30 24252.62 21404.25
1993/10/31 24572.50 21886.01
1993/11/30 23923.05 21207.47
1993/12/31 24863.33 21856.57
1994/01/31 25532.81 22542.27
1994/02/28 25265.02 22337.73
1994/03/31 24255.65 20975.37
1994/04/30 23586.18 20723.81
1994/05/31 23462.58 20781.83
1994/06/30 22597.41 19975.36
1994/07/31 23091.79 20453.67
1994/08/31 24245.35 21705.00
1994/09/30 24307.15 21688.24
1994/10/31 24863.33 22084.15
1994/11/30 24049.66 21333.71
1994/12/31 24193.17 21402.43
1995/01/31 24141.18 21517.04
1995/02/28 25409.58 22637.45
1995/03/31 26262.11 23330.02
1995/04/30 27364.17 24117.35
1995/05/31 28143.92 24729.07
1995/06/30 30327.23 26722.06
1995/07/31 32323.40 28685.72
1995/08/31 32739.27 29251.59
1995/09/30 33211.75 29947.88
1995/10/31 33031.65 29757.50
1995/11/30 33624.91 30443.67
1995/12/31 33441.11 30262.38
1996/01/31 33363.93 30504.05
1996/02/29 34554.71 31683.96
1996/03/31 34620.86 31743.73
1996/04/30 36792.93 34332.87
1996/05/31 38138.08 35879.33
1996/06/30 36803.96 34209.29
1996/07/31 34400.35 31209.67
1996/08/31 36429.08 32983.72
1996/09/30 38984.36 35467.29
1996/10/31 38827.41 35327.38
1996/11/30 41592.17 37400.18
1996/12/31 41378.35 37371.27
1997/01/31 43022.86 39958.65
IMATRL PRASUN SHR__CHT 19970131 19970210 133515 R00000000000123

$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was invested
in Fidelity OTC Portfolio on January 31, 1987 and the current maximum 3%
sales charge was paid. As the chart shows, by January 31, 1997, the value
of the investment would have grown to $43,036 - a 330.36% increase on the
initial investment. For comparison, look at how the NASDAQ Composite Index
did over the same period. With dividends and capital gains, if any,
reinvested, the same $10,000 investment would have grown to $39,959 - a
299.59% 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 MANAGERS' OVERVIEW

NOTE TO SHAREHOLDERS: On January 7, 1997, Robert Bertelson (right photo)
replaced Charles Mangum as Portfolio Manager of Fidelity OTC Portfolio. The
following is an interview with Charles Mangum covering most of the period,
followed by comments by Bob Bertelson on changes he's made to the fund and
his outlook.
Q. CHARLES, HOW DID THE FUND PERFORM?
C.M. For the six months that ended January 31, 1997, the fund had a total
return of 25.10%, compared to 28.03% for the NASDAQ Composite Index.
According to Lipper Analytical Services, the mid-cap funds average returned
18.37% for the same period. For the 12 months that ended January 31, 1997,
the fund returned 28.99%, while the NASDAQ returned 30.99% and the mid-cap
funds average returned 20.65%.
Q. WHAT FACTORS AFFECTED THE FUND'S RELATIVE PERFORMANCE?
C.M. The fund lagged the index because it didn't perform as well in January
after I had cut back some of our holdings in large-company stocks, such as
Intel and Microsoft. Both of those two stocks are large components of the
NASDAQ, and they performed very well in January. The stocks had posted
large gains in 1996, but I was concerned they had reached the end of their
run because statistics had shown that personal computer demand might be
slowing. In addition, one of the fund's larger positions, Nellcor, posted
disappointing earnings as its turnaround took longer than anticipated. The
fund did well against the mid-cap average because during most of the
period, I focused more on large-capitalization names in the NASDAQ - such
as Microsoft, Intel, Cisco Systems and Oracle - than other funds, and those
types of stocks performed better than mid-capitalization stocks overall.
Q. WHAT WAS THE MARKET ENVIRONMENT LIKE DURING THE PAST SIX MONTHS?
C.M. The market was paced by the strong performance of stocks of the
largest companies, based in part on the fact that these companies posted
the best earnings and revenue growth. In addition, sentiment toward stocks
was very positive, with investors putting a great deal of money into the
market. Many institutional money managers looked toward the larger stocks
to stay fully invested because large-capitalization issues offer lower
volatility and a higher degree of liquidity than smaller-company issues. As
a result of this euphoria, valuations of stocks in such indexes as the
NASDAQ are at or near historically high levels.
Q. TURNING TO YOU, BOB, WHAT CHANGES HAVE YOU MADE SINCE TAKING OVER THE
FUND EARLIER THIS MONTH?
B.B. I've made some adjustments to some of the fund's industry weightings.
The fund was quite overweighted in health care stocks compared to the
NASDAQ and, though I like some segments of that sector, I've reduced the
position. Instead, I've invested in energy, transportation and
biotechnology stocks. While I think we'll see lower oil and gas prices this
year, I've invested in energy companies that have the opportunity to
significantly grow their reserves and production levels over the next few
years. Lower commodity prices should help airlines, so I've added to
investments there as well.
Q. WHAT ABOUT BIOTECHNOLOGY?
B.B. Biotech stocks lagged behind the rest of the market in 1996. However,
there are a lot of new drugs up for approval by the Food and Drug
Administration. Historically, these approvals have helped drive biotech
stock price performance. Since it can be difficult to predict which drugs
will show efficacy and receive FDA approval, I've been putting together a
portfolio within a portfolio to give the fund exposure to many possible
approvals, while also minimizing the downside that might result from
concentrating on a smaller number of biotech stocks.
Q. ARE YOU PURSUING ANY OTHER NOTEWORTHY STRATEGIES?
B.B. The stock market has been strong for an extended period of time,
having seen a sharp advance after a correction last July. With each passing
day, we probably get closer to some sort of correction. Corrections in the
over-the-counter market can be very severe, characterized by low levels of
liquidity that cause unwarranted drops in the prices of smaller-sized
stocks. As a result, I've been trying to improve the liquidity of the fund,
in part by adding to some of the larger-cap names in the over-the-counter
market that I think look favorably valued, such as Intel. If we get into a
corrective environment, it's my belief that the larger stocks will decline
less and remain liquid enough for me to sell them, allowing me to redeploy
those assets to invest in attractive small stocks if they experience sharp
price declines.
Q. DOES THAT MEAN YOU FORESEE PROBLEMS IN THE MARKET GOING FORWARD?
B.B. No. I'm cautiously optimistic. I'm optimistic because the economy
seems to be growing at just the right pace, not so strong that the Federal
Reserve Board feels it has to raise interest rates to head off inflation,
or so weak that most companies miss earnings estimates. Several sectors of
the market - including technology - continue to post strong growth rates.
Others, such as the cyclical areas that rise and fall with the economy have
performed well, but haven't been rewarded by investor interest. There is an
opportunity for a rotation toward those stocks that have lagged but whose
business prospects have improved. It's difficult to see what might change
this favorable environment. Usually, higher interest rates hurt a market
like this. While rates may bounce around, it looks as if we won't see them
rise significantly unless the economy accelerates dramatically or we see
clear evidence of wage inflation. At the same time, I'm cautious because
many stocks are up significantly since hitting lows last July. Stock prices
have risen faster than earnings, so the market is vulnerable to a change in
sentiment or interest rate increases. I can't pick when a correction might
happen, so I don't try to figure out the market. Instead, I focus on
investing stock-by-stock, looking for those companies that do the best,
sell at reasonable valuations and offer the opportunity to surprise Wall
Street with their performance.
FUND FACTS
GOAL: long-term capital
growth by investing mainly in
equity securities traded on
the over-the-counter market
FUND NUMBER: 093
TRADING SYMBOL: FOCPX
START DATE: December 31, 1984
SIZE: as of January 31, 1997,
more than $3.6 billion
MANAGER: Robert Bertelson,
since January 1997;
manager, Fidelity
Convertible Securities Fund,
June 1996-January 1997;
Fidelity Select Industrial
Equipment Portfolio,
1994-June 1996; Fidelity
Select Energy Portfolio,
1992-1994; joined Fidelity in
1991
(checkmark)
BOB BERTELSON ON HIS
INVESTMENT APPROACH:
"I'm a growth investor. I like to
find companies with
leadership positions in unit
growth markets - where
companies are increasing
revenues not by increasing
prices but by selling units at a
rate faster than the overall
economy. It's also crucial that
they have the opportunity to
increase their market share.
Ideally, I also prefer
companies that aren't
dependent on external
sources for financing. If they
generate free cash flow, that's
good, but it's not always the
case with rapidly growing
companies. But the lack of
dependence on external
sources of financing is a
positive.
"I also recognize the limits of
knowledge and the fact that
unforeseen consequences can
change business prospects for
a company. As a result, I like
to diversify my investments so
that I don't put myself in a
position where any one
investment, theme or strategy
can severely undercut
performance. I decide the
size of a position in the fund in
relation to the stock's liquidity.
I want to leave myself room to
change my mind either way,
increasing a position if the
company's story is getting
better, or decreasing it if it has
reached full valuation or if
business prospects
deteriorate."
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.
INVESTMENT CHANGES

TOP TEN STOCKS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

Intel Corp. 6.5 4.0

Cisco Systems, Inc. 3.7 3.2

WorldCom, Inc. 3.0 0.4

Oracle Systems Corp. 2.6 3.3

MCI Communications Corp. 2.5 0.5

Microsoft Corp. 2.4 2.3

PacifiCare Health Systems, Inc. Class B 1.7 0.3

Proffitts, Inc. 1.5 1.0

Oxford Health Plans, Inc. 1.4 0.7

Parametric Technology Corp. 1.3 0.5

TOP FIVE MARKET SECTORS AS OF JANUARY 31, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET
SECTORS
6 MONTHS AGO

Technology 40.7 38.2

Health 12.0 10.7

Retail & Wholesale 9.4 8.4

Finance 7.9 10.0

Utilities 6.6 3.8

ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JANUARY 31, 1997 * AS OF JULY 31, 1996 **
Row: 1, Col: 1, Value: 5.3
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 47.34999999999999
Row: 1, Col: 4, Value: 47.34999999999999
Stocks 93.2%
Bonds 0.6%
Short-term
investments 6.2%
FOREIGN
INVESTMENTS 2.6%
Stocks 94.7%
Bonds 0.0%
Short-term
investments 5.3%
FOREIGN
INVESTMENTS 3.2%
Row: 1, Col: 1, Value: 6.2
Row: 1, Col: 2, Value: 2.0
Row: 1, Col: 3, Value: 46.6
Row: 1, Col: 4, Value: 44.6
*
**

INVESTMENTS JANUARY 31, 1997 (UNAUDITED)

Showing Percentage of Total Value of Investment in Securities

COMMON STOCKS - 94.7%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 0.2%
AEROSPACE & DEFENSE - 0.1%
Aviall, Inc. 25,000 $ 285
BE Aerospace, Inc. 100,000 2,656
2,941
SHIP BUILDING & REPAIR - 0.1%
Avondale Industries, Inc. 127,000 2,858
Newport News Shipbuilding, Inc. 153,800 2,460
5,318
TOTAL AEROSPACE & DEFENSE 8,259
BASIC INDUSTRIES - 0.2%
CHEMICALS & PLASTICS - 0.1%
Fuller (H.B.) Co. 75,683 3,775
PAPER & FOREST PRODUCTS - 0.1%
Fort Howard Corp. (a) 80,000 2,540
TOTAL BASIC INDUSTRIES 6,315
CONSTRUCTION & REAL ESTATE - 0.5%
BUILDING MATERIALS - 0.3%
RPM, Inc. 486,900 9,069
ENGINEERING - 0.2%
MasTec, Inc. (a) 135,700 8,650
TOTAL CONSTRUCTION & REAL ESTATE 17,719
DURABLES - 0.4%
AUTOS, TIRES, & ACCESSORIES - 0.1%
Ugly Duckling Corp. (a) 130,000 2,763
CONSUMER DURABLES - 0.0%
Stratasys, Inc. 20,000 398
TEXTILES & APPAREL - 0.3%
Westpoint Stevens, Inc. Class A (a) 301,000 9,405
TOTAL DURABLES 12,566
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
ENERGY - 2.9%
OIL & GAS - 2.9%
Abacan Resource Corp. (a) 1,800,000 $ 19,574
Belden & Blake Corp. (a) 220,900 5,799
Chesapeake Energy Corp. (a) 750,100 17,909
Flores & Rucks, Inc. (a) 199,000 10,224
Forcenergy Gas Exploration, Inc. (a) 682,900 22,280
Rutherford-Moran Oil Corp. 300,000 6,375
Swift Energy Co. (a) 299,900 10,946
Tosco Corp. 100,000 8,850
Vastar Resources, Inc. 108,400 3,916
105,873
FINANCE - 7.9%
BANKS - 2.9%
Fifth Third Bancorp 124,950 9,667
First American Corp. 455 28
First Commerce Bancshares, Inc. 115,600 2,659
First Commerce Bancshares, Inc. Class B 445,900 7,692
First Security Corp. 197,500 6,764
First Tennessee National Corp. 80,900 3,276
Marshall & Ilsley Corp. 304,400 11,567
Northern Trust Corp. 881,700 36,150
Peoples Heritage Financial Group, Inc. 147,900 4,289
SouthTrust Corp. 178,800 6,750
U.S. Bancorp 198,800 9,058
Zions Bancorp 60,900 7,034
104,934
CREDIT & OTHER FINANCE - 1.6%
Aames Financial Corp. 310,000 13,330
Cityscape Financial Corp. (a) 926,900 27,575
Concord EFS, Inc. 100,000 2,000
IMC Mortgage Co. (a) 5,000 250
Money Store, Inc. 140,000 3,570
Rac Financial Group, Inc. (a) 275,000 9,075
Triad Guaranty, Inc. (a) 107,800 3,342
59,142
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - CONTINUED
INSURANCE - 0.3%
GCR Holdings Ltd. 257,600 $ 6,021
Life USA Holding, Inc. (a) 542,000 5,827
11,848
SAVINGS & LOANS - 3.1%
Astoria Financial Corp. 293,500 11,447
Charter One Financial Corp. 747,795 33,744
Collective Bancorp., Inc. 204,800 7,040
Long Island Bancorp., Inc. 440,000 16,115
Washington Federal, Inc. 152,000 3,952
Washington Mutual, Inc. 755,273 41,021
113,319
TOTAL FINANCE 289,243
HEALTH - 12.0%
DRUGS & PHARMACEUTICALS - 2.7%
Alkermes, Inc. (a) 204,900 4,764
Amgen, Inc. (a) 272,800 15,379
Biogen, Inc. (a) 713,600 33,361
Cell Genesys, Inc. (a) 345,100 2,588
COR Therapeutics, Inc. (a) 127,000 1,730
Guilford Pharmaceuticals, Inc. (a) 161,200 3,949
IDEXX Laboratories, Inc. (a) 370,000 12,025
Immunex Corp. 9,900 200
Ligand Pharmaceuticals, Inc. Class B 200,000 2,775
Magainin Pharmaceuticals, Inc. (a) 664,200 5,314
Millennium Pharmaceuticals, Inc. 77,000 1,492
Protein Design Labs, Inc. 20,000 700
Sangstat Medical Corp. (a) 100,000 3,050
Sigma Aldrich Corp. 340,000 10,795
98,122
MEDICAL EQUIPMENT & SUPPLIES - 3.5%
AmeriSource Health Corp. Class A (a) 71,900 3,523
Biomet, Inc. 1,989,400 30,836
Biopsys Medical, Inc. (a) 111,200 2,975
Conmed Corp. (a) 427,400 8,281
Datascope Corp. (a)(b) 959,600 20,871
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - CONTINUED
MEDICAL EQUIPMENT & SUPPLIES - CONTINUED
Heartport, Inc. 50,000 $ 1,581
InControl, Inc. 100,000 738
Nellcor, Inc. (a) 1,904,900 32,383
St. Jude Medical, Inc. (a) 471,150 17,845
Stryker Corp. 234,800 6,809
Xomed Surgical Products, Inc. (a) 188,500 2,851
128,693
MEDICAL FACILITIES MANAGEMENT - 5.8%
Cambridge Heart, Inc. 42,100 521
Integramed America, Inc. (a) 200,000 350
Lincare Holdings, Inc. (a) 876,940 33,159
National Surgery Centers, Inc. (a) 351,500 11,995
Oxford Health Plans, Inc. (a) 910,600 49,514
PacifiCare Health Systems, Inc. Class B (a) 764,100 61,510
PhyMatrix Corp. (a) 556,300 8,831
Physician Corp. of America (a) 520,600 5,108
Quorum Health Group, Inc. (a) 742,800 21,448
TheraTx, Inc. (a) 1,016,800 12,202
United HealthCare Corp. 100,000 4,876
209,514
TOTAL HEALTH 436,329
INDUSTRIAL MACHINERY & EQUIPMENT - 0.7%
ELECTRICAL EQUIPMENT - 0.1%
Cymer, Inc. (a) 50,000 2,575
INDUSTRIAL MACHINERY & EQUIPMENT - 0.6%
Duriron Co., Inc. 390,000 10,359
Greenfield Industries, Inc. 100,800 2,722
PRI Automation, Inc. (a) 112,400 6,758
Park Ohio Industries, Inc. (a) 285,363 4,405
24,244
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 26,819
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
MEDIA & LEISURE - 4.9%
BROADCASTING - 2.1%
Clear Channel Communications, Inc. (a) 242,100 $ 10,320
Evergreen Media Corp. Class A (a) 870,700 26,992
HSN, Inc. (a) 68,000 1,377
Heartland Wireless Communications, Inc. (a)(b) 1,183,300 11,093
PanAmSat Corp. (a) 52,300 1,543
Sinclair Broadcast Group, Inc. Class A (a)(b) 348,700 8,892
TCI Group Class A 959,900 12,779
Tele-Communications Liberty Media Group, Series A 67,500 1,283
Young Broadcasting, Inc. Class A (a) 55,000 1,690
75,969
ENTERTAINMENT - 0.5%
All American Communications, Inc. (a)(b) 970,800 13,834
Regal Cinemas, Inc. 200,000 5,350
19,184
LODGING & GAMING - 0.7%
Anchor Gaming (a) 28,200 1,043
HFS, Inc. (a) 341,100 23,877
24,920
PUBLISHING - 0.6%
Gibson Greetings, Inc. (a) 223,400 4,133
Scholastic Corp. (a) 288,800 17,039
21,172
RESTAURANTS - 1.0%
Apple South, Inc. 535,000 7,958
Applebee's International, Inc. 906,000 24,462
Rare Hospitality International, Inc. (a) 184,700 2,817
35,237
TOTAL MEDIA & LEISURE 176,482
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONDURABLES - 1.4%
FOODS - 0.2%
Tyson Foods, Inc. 188,200 $ 6,375
HOUSEHOLD PRODUCTS - 1.2%
Alberto-Culver Co. Class A 632,400 28,221
Brady (W.H.) Co. Class A 271,000 6,233
Safeskin Corp. (a) 359,800 8,635
43,089
TOTAL NONDURABLES 49,464
RETAIL & WHOLESALE - 9.4%
APPAREL STORES - 1.0%
Gymboree Corp. (a) 766,050 17,619
Just for Feet, Inc. (a) 48,600 1,434
Loehmanns, Inc. (a) 153,500 2,341
Ross Stores, Inc. 375,400 15,391
36,785
GENERAL MERCHANDISE STORES - 3.3%
Casey's General Stores, Inc. 625,900 11,031
Dollar Tree Stores (a) 546,000 23,069
Price/Costco, Inc. (a) 846,400 22,535
Proffitts, Inc. (a)(b) 1,459,500 52,907
Stein Mart, Inc. (a) 470,000 9,459
119,001
GROCERY STORES - 0.3%
Central Garden & Pet Co. (a) 485,000 13,095
RETAIL & WHOLESALE, MISCELLANEOUS - 4.8%
Bed Bath & Beyond, Inc. (a) 607,200 16,698
Corporate Express, Inc. (a) 1,158,150 26,058
IKON Office Solutions, Inc. 48,200 2,127
Officemax, Inc. 1,100,000 13,200
PETsMART, Inc. (a) 306,200 6,966
Staples, Inc. (a) 1,263,100 25,894
U.S. Office Products Co. (a) 1,200,300 39,760
Viking Office Products, Inc. (a) 1,580,700 43,864
174,567
TOTAL RETAIL & WHOLESALE 343,448
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
SERVICES - 3.4%
LEASING & RENTAL - 0.8%
Aaron Rents, Inc. Class B 503,600 $ 5,665
Alrenco, Inc. (a) 100,000 1,138
Danka Business Systems PLC sponsored ADR 362,500 16,131
Renters Choice, Inc. (a) 388,200 6,381
29,315
PRINTING - 0.3%
ASM Lithography Holding NV (a) 150,000 10,969
SERVICES - 2.3%
APAC Teleservices, Inc. (a) 252,100 9,895
Aresco, Inc. 200,000 4,975
Employee Solutions, Inc. (a) 510,100 13,008
G & K Services, Inc. Class A 160,000 5,120
HCIA, Inc. (a) 379,300 14,650
HealthCare COMPARE Corp. (a) 771,900 32,902
PMT Services, Inc. 75,000 1,200
Zebra Technologies Corp. Class A (a) 126,900 3,363
85,113
TOTAL SERVICES 125,397
TECHNOLOGY - 40.7%
COMMUNICATIONS EQUIPMENT - 7.3%
ADC Telecommunications, Inc. (a) 137,000 4,915
Ascend Communications, Inc. (a) 606,900 42,255
Aspect Telecommunications Corp. (a) 293,600 9,102
Brite Voice Systems, Inc. (a) 313,700 5,176
Centigram Communications Corp. 2,800 37
Cisco Systems, Inc. (a) 1,921,900 134,053
Davox Corp. (a) 15,900 668
Dynatech Corp. (a) 163,500 5,886
Ericsson (L.M.) Telephone Co. Class B ADR 200,000 6,734
InterVoice, Inc. (a) 167,000 2,088
Larscom, Inc. Class A (a) 300,000 3,600
Natural Microsystems 50,000 1,725
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMMUNICATIONS EQUIPMENT - CONTINUED
Pairgain Technologies, Inc. 72,800 $ 2,980
Tellabs, Inc. (a) 316,600 13,040
3Com Corp. (a) 527,000 35,375
267,634
COMPUTER SERVICES & SOFTWARE - 13.8%
Adobe Systems, Inc. 222,200 8,416
American Business Information, Inc. (a) 402,500 9,006
Autodesk, Inc. 185,000 5,851
BDM International, Inc. (a) 57,700 3,036
BMC Software, Inc. (a) 190,000 8,241
Black Box Corp. (a) 271,100 10,166
Broderbund Software, Inc. (a) 328,200 10,133
Baan Co. NV (a) 200,000 9,075
Cellular Technical Services, Inc. (a) 100,000 1,375
Citrix Systems, Inc. (a) 79,600 3,682
Clarify, Inc. (a) 67,700 2,437
Electronic Arts, Inc. (a) 75,800 2,416
Electronics for Imaging, Inc. (a) 92,800 8,607
Fiserv, Inc. (a) 347,300 11,613
HBO & Co. 94,400 5,912
HNC Software, Inc. 25,000 753
Intersolv, Inc. 88,500 885
Intuit, Inc. (a) 282,200 8,254
Maxis, Inc. (a) 517,900 6,895
McAfee Associates, Inc. (a) 232,987 13,571
Microsoft Corp. (a) 847,800 86,476
Netscape Communications Corp. (a) 200,600 7,598
Novell, Inc. 750,000 9,469
Oracle Systems Corp. (a) 2,475,425 96,232
Parametric Technology Corp. (a) 816,160 47,133
Paychex, Inc. 251,200 12,183
PeopleSoft, Inc. (a) 80,000 4,360
Project Software & Development, Inc. (a) 6,700 300
Saville Systems Ireland PLC sponsored ADR (a) 1,001,600 42,067
Shared Medical Systems Corp. 688,500 32,489
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - CONTINUED
SunGard Data Systems, Inc. (a) 641,700 $ 25,347
Sybase, Inc. (a) 373,000 6,481
Symantec Corp. 200,000 3,200
503,659
COMPUTERS & OFFICE EQUIPMENT - 4.4%
Adaptec, Inc. (a) 652,400 28,543
Creative Technology Corp. Ltd. (a) 385,000 5,462
Dell Computer Corp. (a) 151,600 10,025
EMC Corp. (a) 500,000 18,938
FileNet Corp. (a) 120,300 2,301
General Binding Corp. 87,100 2,667
Ingram Micro, Inc. Class A (a) 617,000 12,803
Quantum Corp. (a) 669,200 25,430
Read Rite Corp. (a) 50,000 1,650
Seagate Technology 100,000 5,150
Sun Microsystems, Inc. (a) 439,400 13,951
Tech Data Corp. (a) 405,400 10,338
Wang Laboratories, Inc. (a) 990,700 23,032
160,290
ELECTRONIC INSTRUMENTS - 1.4%
Applied Materials, Inc. (a) 200,000 9,875
KLA Instruments Corp. (a) 299,000 12,745
Lam Research Corp. (a) 305,300 12,326
Novellus System, Inc. (a) 159,500 12,640
Teradyne, Inc. 100,000 3,088
50,674
ELECTRONICS - 13.8%
Actel Corp. (a) 200,000 4,100
Altera Corp. (a) 508,200 21,980
Atmel Corp. (a) 617,700 28,646
Brightpoint, Inc. 200,000 5,675
DH Technology, Inc. (a) 272,100 4,677
Hadco Corp. (a) 107,000 5,805
Integrated Device Technology, Inc. (a) 605,900 6,362
Intel Corp. 1,469,900 238,491
Lattice Semiconductor Corp. (a) 395,100 20,496
Linear Technology Corp. 574,100 27,987
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
ELECTRONICS - CONTINUED
Maxim Integrated Products, Inc. (a) 381,100 $ 21,437
Microchip Technology, Inc. (a) 536,700 20,462
Molex, Inc. 876,437 33,524
Sanmina Corp. (a) 426,100 25,353
Tencor Instruments (a) 614,400 25,037
Uniphase Corp. (a) 283,200 12,353
502,385
TOTAL TECHNOLOGY 1,484,642
TRANSPORTATION - 3.5%
AIR TRANSPORTATION - 1.4%
ASA Holdings, Inc. 150,000 3,375
Comair Holdings, Inc. 400,000 8,150
Continental Airlines, Inc. 500,000 13,938
Northwest Airlines Corp. Class A (a) 740,000 25,160
50,623
RAILROADS - 0.6%
Wisconsin Central Transportation Corp. (a) 571,200 21,206
TRUCKING & FREIGHT - 1.5%
Air Express International Corp. 660,300 20,923
American Freightways Corp. (a) 210,000 2,809
Expeditors International of Washington, Inc. 516,000 11,159
Landstar System, Inc. (a) 100,000 2,375
M.S. Carriers, Inc. (a) 311,900 4,990
Roadway Express, Inc. 100,000 2,050
USFreightways Corp. 319,300 8,102
Werner Enterprises, Inc. 268,300 4,829
57,237
TOTAL TRANSPORTATION 129,066
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
UTILITIES - 6.6%
CELLULAR - 0.5%
Arch Communications Group, Inc. (a) 904,200 $ 7,460
Pagemart Wireless, Inc. Class A (a) 1,188,500 8,170
Palmer Wireless, Inc. (a) 114,300 1,186
16,816
TELEPHONE SERVICES - 6.1%
Brooks Fiber Properties, Inc. 351,000 8,995
MCI Communications Corp. 2,567,000 90,166
Teleport Communications Group, Inc. Class A (a) 456,100 14,196
WorldCom, Inc. (a) 4,408,834 110,772
224,129
TOTAL UTILITIES 240,945
TOTAL COMMON STOCKS
(Cost $2,808,921) 3,452,567
CASH EQUIVALENTS - 5.3%
MATURITY
AMOUNT (000S)
Investments in repurchase agreements
(U.S. Treasury obligations) in a joint
trading account at 5.56%, dated
1/31/97 due 2/3/97 $ 11,820 11,815
SHARES
Taxable Central Cash Fund (c) 181,203,897 181,204
TOTAL CASH EQUIVALENTS
(Cost $193,019) 193,019
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $3,001,940) $ 3,645,586
LEGEND
1. Non-income producing
2. Affiliated company (see Note 7 of Notes to Financial Statements).
3. At period end, the seven-day yield on the Taxable Central Cash Fund was
5.39%. The yield refers to the income earned by investing in the fund over
the seven-day period, expressed as an annual percentage.
INCOME TAX INFORMATION
At January 31, 1997, the aggregate cost of investment securities for income
tax purposes was $3,004,434,000. Net unrealized appreciation aggregated
$641,152,000, of which $751,993,000 related to appreciated investment
securities and $110,841,000 related to depreciated investment securities.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS(EXCEPT PER-SHARE AMOUNTS) JANUARY 31, 1997 (UNAUDITED)

ASSETS

Investment in securities, at value (including repurchase $ 3,645,586
agreements of $11,815) (cost $3,001,940) - See
accompanying schedule

Receivable for investments sold 80,208

Receivable for fund shares sold 12,988

Dividends receivable 532

Interest receivable 832

Other receivables 798

TOTAL ASSETS 3,740,944

LIABILITIES

Payable to custodian bank $ 302

Payable for investments purchased 114,054

Payable for fund shares redeemed 20,664

Accrued management fee 1,564

Other payables and accrued expenses 821

TOTAL LIABILITIES 137,405

NET ASSETS $ 3,603,539

Net Assets consist of:

Paid in capital $ 2,813,225

Distributions in excess of net investment income (3,554)

Accumulated undistributed net realized gain (loss) on 150,222
investments and foreign currency transactions

Net unrealized appreciation (depreciation) on 643,646
investments and assets and liabilities in foreign
currencies

NET ASSETS, for 105,935 shares outstanding $ 3,603,539

NET ASSET VALUE and redemption price per share $34.02
($3,603,539 (divided by) 105,935 shares)

Maximum offering price per share (100/97.00 of $34.02) $35.07

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS ENDED JANUARY 31, 1997 (UNAUDITED)

INVESTMENT INCOME $ 5,419
Dividends

Interest 5,082

TOTAL INCOME 10,501

EXPENSES

Management fee $ 10,381
Basic fee

Performance adjustment (944)

Transfer agent fees 3,974

Accounting fees and expenses 408

Non-interested trustees' compensation 9

Custodian fees and expenses 83

Registration fees 280

Audit 32

Legal 10

Interest 2

Miscellaneous 13

Total expenses before reductions 14,248

Expense reductions (196) 14,052

NET INVESTMENT INCOME (LOSS) (3,551)

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

Investment securities (including realized gain (loss) of 318,633
$(4,160) on sales of investments in affiliated issuers)

Foreign currency transactions (2) 318,631

Change in net unrealized appreciation (depreciation) on:

Investment securities 368,936

Assets and liabilities in foreign currencies (1) 368,935

NET GAIN (LOSS) 687,566

NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 684,015
FROM OPERATIONS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED JANUARY JULY 31,
31, 1997 1996
(UNAUDITED)

INCREASE (DECREASE) IN NET ASSETS

Operations $ (3,551) $ 10,370
Net investment income (loss)

Net realized gain (loss) 318,631 380,992

Change in net unrealized appreciation (depreciation) 368,935 (255,943)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 684,015 135,419
FROM OPERATIONS

Distributions to shareholders (6,872) (1,479)
From net investment income

From net realized gain (391,420) (130,433)

TOTAL DISTRIBUTIONS (398,292) (131,912)

Share transactions 1,607,844 2,256,968
Net proceeds from sales of shares

Reinvestment of distributions 390,322 129,010

Cost of shares redeemed (1,315,493) (1,864,420)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING 682,673 521,558
FROM SHARE TRANSACTIONS

TOTAL INCREASE (DECREASE) IN NET ASSETS 968,396 525,065

NET ASSETS

Beginning of period 2,635,143 2,110,078

End of period (including under (over) distribution $ 3,603,539 $ 2,635,143
of net investment income of $(3,554) and $8,871,
respectively)

OTHER INFORMATION
Shares

Sold 48,796 70,969

Issued in reinvestment of distributions 12,633 4,239

Redeemed (39,960) (58,605)

Net increase (decrease) 21,469 16,603

</TABLE>

FINANCIAL HIGHLIGHTS
SIX MONTHS YEARS ENDED JULY 31,
ENDED JANUARY
31, 1997

(UNAUDITED) 1996 1995 1994 D 1993 1992

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

Net asset value, $ 31.20 $ 31.09 $ 22.42 $ 25.90 $ 24.65 $ 24.28
beginning of period

Income from
Investment
Operations

Net investment (.04) G .13 .09 .12 .06 .08
income (loss)

Net realized and 7.26 1.80 8.79 (.08) 3.68 2.92
unrealized gain
(loss)

Total from investment 7.22 1.93 8.88 .04 3.74 3.00
operations

Less Distributions (.08) (.02) (.09) (.12) (.25) (.12)
From net investment
income

From net realized gain (4.32) (1.80) (.12) (3.40) (2.24) (2.51)

Total distributions (4.40) (1.82) (.21) (3.52) (2.49) (2.63)

Net asset value, end $ 34.02 $ 31.20 $ 31.09 $ 22.42 $ 25.90 $ 24.65
of period

TOTAL RETURN B, C 25.10% 6.43% 39.98% (.36) 16.67% 13.30%
%

RATIOS AND SUPPLEMENTAL DATA

Net assets, end of $ 3,604 $ 2,635 $ 2,110 $ 1,230 $ 1,327 $ 1,037
period (in millions)

Ratio of expenses to .89% A .83% .82% .89% 1.08% 1.17%
average net assets

Ratio of expenses to .87% A, .82% .81% .88% 1.08% 1.17%
average net assets E E E E
after expense
reductions

Ratio of net investment (.22)% .42% .35% .48% .53% .59%
income (loss) to A
average net assets

Portfolio turnover rate 164% A 133% 62% 222% 213% 245%

Average commission $ .0273
rate F

</TABLE>

ANNUALIZED
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).
TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED.
EFFECTIVE AUGUST 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 (LOSS) PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 6 OF
NOTES TO FINANCIAL STATEMENTS).
FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER.
NET INVESTMENT INCOME (LOSS) PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1997 (Unaudited)

19. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity OTC Portfolio (the fund) is a fund of Fidelity Securities Fund
(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 financial statements have been prepared
in conformity with generally accepted accounting principles which permit
management to make certain estimates and assumptions at the date of the
financial statements. 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 (including restricted 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 with remaining maturities
of sixty days or less for which quotations are not readily available are
valued at amortized cost or original cost plus accrued interest, both of
which approximate current value.
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. Income receipts
and expense payments are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and
sales of securities are translated into U.S. dollars at the contractual
currency exchange rates established at the time of each trade.
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, 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 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. Non-cash dividends included in dividend income, if any,
are recorded at
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
INVESTMENT INCOME - CONTINUED
the fair market value of the securities received. Interest income 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.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded 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 litigation
proceeds, foreign currency transactions and losses deferred due to wash
sales. 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.
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.
20. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign-denominated securities.
Losses may arise from changes in the value of the foreign currency or if
the counterparties do not perform under the contracts' terms. The U.S.
dollar value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), 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 for U.S. Treasury or
Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account,
2. OPERATING POLICIES - CONTINUED
REPURCHASE AGREEMENTS - CONTINUED
at a bank custodian. The securities are marked-to-market daily and
maintained at a value at least equal to the principal amount of the
repurchase agreement (including accrued interest). FMR, the fund's
investment adviser, is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by the
SEC, the fund may invest in the Taxable Central Cash Fund (the Cash Fund)
managed by FMR Texas, an affiliate of FMR. The Cash Fund is an open-end
money market fund available only to investment companies and other accounts
managed by FMR and its affiliates. The Cash Fund seeks preservation of
capital, liquidity, and current income by investing in U.S. Treasury
securities and repurchase agreements for these securities, and may be
utilized by the fund as an additional cash management option. Dividends
from the Cash Fund are declared daily and paid monthly from net interest
income. Income distributions received by the fund are recorded as interest
income.
21. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $2,781,442,000 and $2,492,135,000, respectively.
22. 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 .2500% 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 .35%. The
basic fee is subject to a performance adjustment (up to a maximum of
(plus/minus).20% of the fund's average net assets over the performance
period) based on the fund's investment performance as compared to the
appropriate index over a specified period of time. For the period, the
management fee was equivalent to an annualized rate of .59% of average net
assets after the performance adjustment.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SALES LOAD. For the period, Fidelity Distributors Corporation, an affiliate
of FMR and the general distributor of the fund, received sales charges of
$320,000 on sales of shares of the fund.
TRANSFER AGENT FEES. Fidelity Service Company, Inc. (FSC), an affiliate of
FMR, is the fund's transfer, dividend disbursing and shareholder servicing
agent. FSC receives account fees and asset-based fees that vary according
to account size and type of account. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements. For the
period, the transfer agent fees were equivalent to an annualized rate of
.25% of average net assets.
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 $159,000 for the period.
23. 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 $6,255,000. The weighted average
interest rate was 5.57%.
24. 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
$83,000 under this arrangement.
In addition, the fund has entered into arrangements with its custodian and
transfer agent whereby interest earned on uninvested cash balances was used
to offset a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $27,000 and $86,000,
respectively, under these arrangements.
25. 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
AMOUNTS IN THOUSANDS
PURCHASE SALES DIVIDEND VALUE
AFFILIATE COST COST INCOME
All American Communications, Inc. $ 199 $ - $ - $ 13,834
Datascope Corp. 2,664 - - 20,871
Heartland Wireless
Communications, Inc. 1,540 - - 11,093
Proffitts, Inc. 15,015 4,939 - 52,907
Sinclair Broadcast Group, Inc. Class A 2,247 2,332 - 8,892
TheraTx, Inc. 1,621 10,002 - -
TOTALS $ 23,286 $ 17,273 $ - $ 107,597
MANAGING YOUR INVESTMENTS

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AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES.
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
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 *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
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Fidelity Distributors Corporation
Boston, MA
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SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
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