FIDELITY ADVISOR FUNDS
CLASS B
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how each
fund invests and the services available to shareholders.
Only Class B shares are offered through this Prospectus. The funds also
offer Class A and Class T shares through the Class A, Class T, and Class B
Prospectus dated August 30, 1996 which is a part hereof. Throughout this
Prospectus, the Class A, Class T, and Class B Prospectus dated August 30,
1996 is referred to as the "Class A, Class T, and Class B Prospectus."
To learn more about each fund and its investments, you can obtain a copy of
the applicable fund's most recent financial report and portfolio listing, a
copy of the Statement of Additional Information (SAI) dated November 29,
1996, or a copy of the Class A, Class T, Class B, and Institutional Class
SAI dated August 30, 1996. The SAIs have been filed with the Securities and
Exchange Commission (SEC) and are available along with other related
materials on the SEC's Internet Web site (http://www.sec.gov). The SAIs are
incorporated herein by reference (legally forms a part of the prospectus).
For a free copy of any of the above referenced documents, contact Fidelity
Distributors Corporation (FDC), 82 Devonshire Street, Boston, MA 02109, or
your investment professional.
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.
LIKE ALL MUTUAL FUNDS, THESE SECURITIES
HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
ACO M B-dis-1196
FIDELITY ADVISOR EQUITY GROWTH FUND seeks to achieve capital appreciation
by investing primarily in common and preferred stock and securities
convertible into the common stock of companies with above-average growth
characteristics.
FIDELITY ADVISOR BALANCED FUND (FORMERLY ADVISOR I NCOME
& GROWTH FUND) seeks both income and growth of capital by investing in
a diversified portfolio of equity and fixed-income securities with income,
growth of income and capital appreciation potential.
PROSPECTUS
NOVEMBER 29, 1996
AS REVISED JANUARY 2, 1997(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE
STREET, BOSTON, MA 02109
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
KEY FACTS WHO MAY WANT TO INVEST
EXPENSES Class B's sales charge (load) and its yearly
operating expenses.
FINANCIAL HIGHLIGHTS A summary of each fund's financial
data.
PERFORMANCE How each class has done over time.
THE FUNDS IN DETAIL CHARTER How each fund is organized.
INVESTMENT PRINCIPLES AND RISKS Each fund's overall
approach to investing.
BREAKDOWN OF EXPENSES How operating costs are
calculated and what they include.
YOUR ACCOUNT TYPES OF ACCOUNTS Different ways to set up your
account, including tax-sheltered retirement plans.
HOW TO BUY SHARES Opening an account and making
additional investments.
HOW TO SELL SHARES Taking money out and closing your
account.
INVESTOR SERVICES Services to help you manage your
account.
SHAREHOLDER AND ACCOUNT POLICIES DIVIDENDS, CAPITAL GAINS, AND TAXES
TRANSACTION DETAILS Share price calculations and the
timing of purchases and redemptions.
EXCHANGE RESTRICTIONS
SALES CHARGE REDUCTIONS AND WAIVERS
</TABLE>
KEY FACTS
WHO MAY WANT TO INVEST
Class B shares are offered to investors who engage an investment
professional for investment advice.
Refer to the "Who May Want to Invest" section beginning on page 3 of the
Class A, Class T, and Class B Prospectus for a general discussion of the
types of investors for whom each fund is designed.
Each fund is composed of multiple classes of shares. All classes of a fund
have a common investment objective and investment portfolio. Class A and
Class T shares have front-end sales charges and pay distribution fees.
Class T shares may be subject to a contingent deferred sales charge (CDSC).
Class B shares do not have a front-end sales charge, but do have a CDSC,
and pay a distribution fee and a shareholder service fee. Institutional
Class shares have no sales charge and do not pay a distribution fee or a
shareholder service fee, but are available only to certain types of
investors. See "Sales Charge Reductions and Waivers," page 55 of the Class
A, Class T, and Class B Prospectus for Institutional Class eligibility
information.
You may obtain more information about Institutional Class shares, which are
not offered through this prospectus, by calling 1-800-843-3001 or from your
investment professional. Contact your investment professional to discuss
which class is appropriate for you.
In determining which class of shares is the most appropriate for you, you
should consider, among other factors, the length of time you intend to hold
your shares. In general, because of its higher front-end load, Class A
shares have higher costs than Class T for a short holding period and,
because of their lower 12b-1 fees, lower costs than Class T for a longer
holding period. If you are planning to invest a significant amount either
at one time or through a regular investment program, you should consider
the reduced sales charges available on Class A and Class T shares. If you
prefer not to pay a front-end sales charge and plan to hold your shares for
more than three or six years, as applicable, you should consider
Class B shares. While Class B shares are subject to higher ongoing
expenses, they are sold without a front-end sales charge so your entire
purchase amount is immediately invested. However, if you sell your Class B
shares within six years, you will normally pay a CDSC that varies
depending on how long you have held your shares.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or
sell Class B shares of a fund. In addition, you may be charged an annual
account maintenance fee if your account balance falls below $2,500. A CDSC
is imposed on Class B shares only if you redeem Class B shares within
six years of purchase. See Transaction Details, page 7, for
information about the CDSC and the conversion feature.
<TABLE>
<CAPTION>
<S> <C> <C>
Class B
Maximum sales charge (as a % of offering price) None
Maximum CDSC 5. 0 0%[A
]
Maximum sales charge on reinvested distributions None
Redemption fee None
Exchange fee None
Annual account maintenance fee (for accounts under $2,500) $12.00
</TABLE>
[A] DECLINES OVER 6 YEARS FROM 5.00% TO 0%.
ANNUAL OPERATING EXPENSES are paid out of each fund's assets. Each fund
pays a management fee to Fidelity Management & Research Company (FMR). Each
fund also incurs other expenses for services such as maintaining
shareholder records and furnishing shareholder statements and financial
reports.
12b-1 fees for Class B include a distribution fee and a shareholder service
fee. Distribution fees are paid by each class to FDC for services and
expenses in connection with the distribution of the class's shares.
Shareholder service fees are paid by Class B to investment professionals
for services and expenses incurred in connection with providing personal
service and/or maintenance of Class B shareholder accounts. Long-term
shareholders may pay more than the economic equivalent of the maximum sales
charges permitted by the National Association of Securities Dealers, Inc.
due to 12b-1 fees.
Class B's expenses are factored into its share price or dividends and are
not charged directly to shareholder accounts (see "Breakdown of Expenses"
on page 6).
The figures on the following page are based on estimated expenses of Class
B of each fund, and are calculated as a percentage of average net assets of
Class B of each fund. A portion of the brokerage commissions that each fund
pays is used to reduce fund expenses. In addition, each fund has entered
into arrangements with its custodian and transfer agent whereby interest
earned on uninvested cash balances is used to reduce custodian and transfer
agent expenses.
In the tables on the following page, the column marked "Examples" shows the
expenses you would pay, including the maximum CDSC, on a $1,000 investment
in Class B shares, assuming a 5% annual return and either (1) full
redemption or (2) no redemption, at the end of each time period:
...EQUITY FUNDS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Examples
Full No
Redemption Redemption
EQUITY GROWTH Management fee[A] 0.61% After 1 year $ 7 0[D] $ 20
12b-1 fee (including 1.00% After 3 $ 91[D] $ 61
0.25% Shareholder years
Service Fee)
Other expenses[B] 0.34% After 5 $ 1 2 5[D] $ 105
years
Total operating 1.95% After 10 $ 199 $ 199
expenses years[E]
BALANCED Management fee[C] 0.46% After 1 year $ 69 [D] $ 19
12b-1 fee (including 1.00% After 3 $ 90[D] $ 60
0.25% Shareholder years
Service Fee)
Other expenses [B] 0.44% After 5 $ 1 2 3 [D] $ 103
years
Total operating 1.90% After 10 $ 1 92 $ 1 92
expenses years[E]
</TABLE>
[A] EFFECTIVE AUGUST 1, 1994, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
0.33% TO 0.30%. IF THIS AGREEMENT WAS NOT IN EFFECT, THE MANAGEMENT FEE
WOULD BE 0.64% AND ESTIMATED TOTAL OPERATING EXPENSES WOULD BE 1.98% FOR
CLASS B.
[B] BASED ON ESTIMATED EXPENSES FOR FIRST YEAR.
[C] EFFECTIVE AUGUST 1, 1996, FMR VOLUNTARILY AGREED TO IMPLEMENT A
MANAGEMENT FEE REDUCTION. THE INDIVIDUAL FUND FEE RATE WAS REDUCED FROM
0.20% TO 0.15%. IF THIS AGREEMENT WAS NOT IN EFFECT, THE MANAGEMENT FEE
WOULD BE 0.51% AND ESTIMATED TOTAL OPERATING EXPENSES WOULD BE 1.95% FOR
CLASS B.
[D] REFLECTS DEDUCTION OF APPLICABLE CDSC.
[E] REFLECTS CONVERSION OF CLASS B SHARES TO CLASS A SHARES AFTER SEVEN
YEARS.
THESE EXAMPLES ILLUSTRATE THE EFFECT OF EXPENSES, BUT ARE NOT MEANT TO
SUGGEST ACTUAL OR EXPECTED COSTS OR RETURNS, ALL OF WHICH MAY VARY.
FMR has voluntarily agreed to reimburse Class B of each fund to the extent
that total operating expenses as a percentage of their respective average
net assets, exceed the following rates:
Effective
Date
Equity Growth 2.50 12/31/9
% 6
Balanced 2. 25 12/31/9
% 6
Expenses eligible for reimbursement do not include interest, taxes,
brokerage commissions, and extraordinary expenses.
FINANCIAL HIGHLIGHTS
Refer to the "Financial Highlights" section beginning on page 12 of the
Class A, Class T, and Class B Prospectus for a summary of each fund's
financial data.
PERFORMANCE
Equity Growth's fiscal year runs from December 1 through November 30.
Balanced's fiscal year runs from November 1 through October 31. The
table on the following page shows each class's performance over past fiscal
years. The charts following the table present calendar year performance.
Class B of each fund is expected to commence on or about December 31, 1996.
...CLASS B
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Average Annual Total Return [D] Cumulative Total Return [D]
Past 1 Past 5 10 years/ Past 6 Past 1 Past 5 10 years/
year years Life of fund+ months year years Life of fund+
EQUITY GROWTH - CLASS B[B] 34.47 17.31 17.74 10.37 34.47 122.1 411.8
% % % % % 6% 9%
EQUITY GROWTH - CLASS B
(LOAD ADJ.)[A][B] 29 .47 17. 10 17.74 5 .37% 29 .47 12 0 .1 411.8
% % % % 6% 9%
BALANCED - CLASS
B[C] 7.58% 9.97% 11.21 2.66% 7.58% 60.80 169.3
% % 5%
BALANCED - CLASS B
(LOAD ADJ.)[A][C] 2.58% 9.69% 11.21 -2.34 2.58% 58.80 169.3
% % % 5%
</TABLE>
+ LIFE OF FUND FIGURES FOR INCOME & GROWTH ARE FROM COMMENCEMENT OF
OPERATIONS (JANUARY 6, 1987).
[A] C LASS B'S CONTINGENT DEFERRED SALES CHARGES INCLUDED IN THE
PAST SIX MONTHS, PAST ONE YEAR, PAST FIVE YEARS, AND 10 YEARS/LIFE
OF FUND TOTAL RETURN FIGURES ARE 5%, 5%, 2%, AND 0% RESPECTIVELY.
[B] PERIOD ENDED MAY 31, 1996.
[C] PERIOD ENDED APRIL 30, 1996.
[D] INITIAL OFFERING OF CLASS B SHARES OF EQUITY GROWTH WILL TAKE PLACE ON
OR ABOUT JANUARY 2, 1997. CLASS B SHARES BEAR A 12B-1 FEE (INCLUDING
SHAREHOLDER SERVICING FEE), WHICH IS NOT REFLECTED IN PRIOR RETURN DATES.
RETURNS BETWEEN JANUARY 1, 1996 AND MAY 31, 1996 ARE THOSE OF CLASS T AND
REFLECT CLASS T'S THEN APPLICABLE 0.50% 12B-1 FEE. RETURNS BETWEEN
SEPTEMBER 10, 1992 AND DECEMBER 31, 1995 ARE THOSE OF CLASS T AND REFLECT
CLASS T'S THEN APPLICABLE 0.65% 12B-1 FEE. RETURNS PRIOR TO SEPTEMBER 10,
1992 ARE THOSE OF INSTITUTIONAL CLASS, THE ORIGINAL CLASS OF THE FUND,
WHICH DOES NOT BEAR A 12B-1 FEE. CLASS B SHARE RETURNS WOULD HAVE BEEN
LOWER HAD ITS 12B-1 AND SHAREHOLDER SERVICING FEE BEEN REFLECTED IN PRIOR
DATE RETURNS.
INITIAL OFFERING OF CLASS B SHARES OF BALANCED WILL TAKE PLACE ON OR
ABOUT JANUARY 2, 1997. CLASS B SHARES BEAR A 12B-1 FEE (INCLUDING
SHAREHOLDER SERVICING FEE), WHICH IS NOT REFLECTED IN PRIOR RETURN DATES.
RETURNS BETWEEN JANUARY 1, 1996 AND APRIL 30, 1996 ARE THOSE OF CLASS T AND
REFLECT CLASS T'S THEN APPLICABLE 0.50% 12B-1 FEE. RETURNS BETWEEN JANUARY
6, 1987 AND DECEMBER 31, 1995 ARE THOSE OF CLASS T AND REFLECT CLASS T'S
THEN APPLICABLE 0.65% 12B-1 FEE. CLASS B SHARE RETURNS WOULD HAVE BEEN
LOWER HAD ITS 12B-1 AND SHAREHOLDER SERVICING FEE BEEN REFLECTED IN PRIOR
DATE RETURNS.
...YEAR-BY-YEAR TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Calendar years+ 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995
EQUITY GROWTH - CLASS B 14.51 -0.57 15.57 44.84 6.93% 64.71 9.89% 14.85 -0.89 39.14
% % % % % % % %
S&P 500 18.56 5.10% 16.61 31.69 -3.10 30.47 7.62% 10.08 1.32% 37.58
% % % % % % %
Lipper Growth Funds Average[A] 14.73 3.08% 14.79 26.91 -4.49 36.70 8.08% 10.63 -2.17 30.79
% % % % % % % %
Consumer Price Index 1.10% 4.43% 4.42% 4.65% 6.11% 3.06% 2.90% 2.75% 2.67% 2.54%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 14.51
Row: 2, Col: 1, Value: -0.5700000000000001
Row: 3, Col: 1, Value: 15.57
Row: 4, Col: 1, Value: 44.84
Row: 5, Col: 1, Value: 6.930000000000001
Row: 6, Col: 1, Value: 64.71000000000001
Row: 7, Col: 1, Value: 9.890000000000001
Row: 8, Col: 1, Value: 14.85
Row: 9, Col: 1, Value: -0.89
Row: 10, Col: 1, Value: 39.14
(LARGE SOLID BOX) EQUITY GROWTH - CLASS B
+ RETURNS DO NOT INCLUDE THE EFFECT OF PAYING CLASS B'S APPLICABLE CDSC.
INITIAL OFFERING OF CLASS B SHARES OF EQUITY GROWTH WILL TAKE PLACE ON OR
ABOUT JANUARY 2, 1997. CLASS B SHARES BEAR A 12B-1 FEE (INCLUDING
SHAREHOLDER SERVICING FEE), WHICH IS NOT REFLECTED IN PRIOR RETURN DATES.
RETURNS BETWEEN SEPTEMBER 10, 1992 AND DECEMBER 31, 1995 ARE THOSE OF CLASS
T AND REFLECT CLASS T'S THEN APPLICABLE 0.65% 12B-1 FEE. RETURNS PRIOR TO
SEPTEMBER 10, 1992 ARE THOSE OF INSTITUTIONAL CLASS, THE ORIGINAL CLASS OF
THE FUND, WHICH DOES NOT BEAR A 12B-1 FEE. CLASS B SHARE RETURNS WOULD
HAVE BEEN LOWER HAD ITS 12B-1 AND SHAREHOLDER SERVICING FEE BEEN REFLECTED
IN PRIOR DATE RETURNS.
[A] THE LIPPER GROWTH FUNDS AVERAGE CURRENTLY REFLECTS THE PERFORMANCE OF
OVER 739 MUTUAL FUNDS WITH SIMILAR OBJECTIVES.
...YEAR-BY-YEAR TOTAL RETURNS
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Calendar years+
1988 1989 1990 1991 1992 1993 1994 1995
BALANCED - CLASS B
20.89 24.60 -2.94 34.48 9.20% 19.66 -5.09 14.06
% % % % % % %
S&P 500
16.61 31.69 -3.10 30.47 7.62% 10.08 1.32% 37.58
% % % % % %
Lipper Balanced Funds Average[A]
12.34 19.57 -0.57 26.69 7.07% 10.91 -2.50 25.16
% % % % % % %
Consumer Price Index
4.42% 4.65% 6.11% 3.06% 2.90% 2.75% 2.67% 2.54%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 0.0
Row: 2, Col: 1, Value: 0.0
Row: 3, Col: 1, Value: 20.89
Row: 4, Col: 1, Value: 24.6
Row: 5, Col: 1, Value: -2.94
Row: 6, Col: 1, Value: 34.48
Row: 7, Col: 1, Value: 9.199999999999999
Row: 8, Col: 1, Value: 19.66
Row: 9, Col: 1, Value: -5.09
Row: 10, Col: 1, Value: 14.06
(LARGE SOLID BOX) BALANCED - CLASS B
+ RETURNS DO NOT INCLUDE THE EFFECT OF PAYING CLASS B'S APPLICABLE CDSC.
INITIAL OFFERING OF CLASS B SHARES OF BALANCED WILL TAKE PLACE ON OR
ABOUT JANUARY 2, 1997. CLASS B SHARES BEAR A 12B-1 FEE (INCLUDING
SHAREHOLDER SERVICING FEE), WHICH IS NOT REFLECTED IN PRIOR RETURN DATES.
RETURNS BETWEEN JANUARY 6, 1987 AND DECEMBER 31, 1995 ARE THOSE OF CLASS T
AND REFLECT CLASS T'S THEN APPLICABLE 0.65% 12B-1 FEE. CLASS B SHARE
RETURNS WOULD HAVE BEEN LOWER HAD ITS 12B-1 AND SHAREHOLDER SERVICING FEE
BEEN REFLECTED IN PRIOR DATE RETURNS.
[A] THE LIPPER BALANCED FUNDS AVERAGE CURRENTLY REFLECTS THE PERFORMANCE OF
OVER 295 MUTUAL FUNDS WITH SIMILAR OBJECTIVES.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government. Refer to the "Performance" section
beginning on page 23 of the Class A, Class T, and Class B Prospectus for a
discussion of other terms used in presenting performance information.
THE FUNDS IN DETAIL
CHARTER
FDC distributes and markets Fidelity's funds and services. Fidelity
Investments Institutional Operations Company (FIIOC) performs transfer
agent servicing functions for Class B shares of each fund.
Refer to the "Charter" section beginning on page 28 of the Class A, Class
T, and Class B Prospectus for more information about how each fund is
organized.
INVESTMENT PRINCIPLES AND RISKS
Refer to the "Investment Principles and Risks" section beginning on page
30 of the Class A, Class T, and Class B Prospectus for information about
each fund's overall approach to investing.
BREAKDOWN OF EXPENSES
Refer to the "Breakdown of Expenses" section beginning on page 40 of the
Class A, Class T, and Class B Prospectus for details about each fund's
management fee and sub-advisory agreements.
OTHER EXPENSES
While the management fee is a significant component of each fund's
annual operating costs, the funds have other expenses as well.
FIIOC performs transfer agency, dividend disbursing and shareholder
services for Class B of each fund. FSC calculates the NAV and dividends for
Class B shares of each fund, maintains the general accounting records, and
administers the securities lending program for each fund.
Class B shares of each fund have adopted a DISTRIBUTION AND SERVICE PLAN.
Under the Class B Plans, Class B of each fund is authorized to pay FDC a
monthly distribution fee as compensation for its services and expenses in
connection with the distribution of Class B shares. Class B of each fund
may pay FDC a distribution fee at an annual rate of up to 0.75% of its
average net assets, or such lesser amount as the Trustees may determine
from time to time.
Class B of each fund currently pays FDC monthly at an annual rate of 0.75%
of its average net assets throughout the month.
In addition, pursuant to each Class B Plan, investment professionals are
compensated at an annual rate of 0.25% of Class B's average net assets
throughout the month for providing personal service to and/or maintenance
of Class B shareholder accounts.
The Plans specifically recognize that FMR may make payments from its
management fee revenue, past profits, or other resources to FDC for
expenses incurred in connection with the distribution of Class B shares,
including payments made to investment professionals that provide
shareholder support services or engage in the sale of the funds' Class B
shares. The Board of Trustees of each fund has authorized such payments.
Refer to the subsection "Other Expenses," on page 42 of the Class A, Class
T and Class B Prospectus, for details about other expenses of each fund and
portfolio turnover rates.
YOUR ACCOUNT
TYPES OF ACCOUNTS
Refer to the "Types of Accounts" section beginning on page 44 of the Class
A, Class T, and Class B Prospectus for information about different ways to
set up your account.
HOW TO BUY SHARES
Refer to the "How to Buy Shares" section beginning on page 45 of the Class
A, Class T, and Class B Prospectus for information about opening an account
and making additional investments.
HOW TO SELL SHARES
Refer to the "How to Sell Shares" section beginning on page 47 of the Class
A, Class T, and Class B Prospectus for information about taking money out
and closing your account.
INVESTOR SERVICES
Refer to the "Investor Services" section beginning on page 48 of the Class
A, Class T, and Class B Prospectus for information about services to help
you manage you account, including exchange privileges and regular
investment plans.
SHAREHOLDER AND ACCOUNT POLICIES
DIVIDENDS, CAPITAL GAINS, AND TAXES
Refer to the "Dividends, Capital Gains, and Taxes" section beginning on
page 50 of the Class A, Class T, and Class B Prospectus for information
about capital gains and dividends, distribution options, and taxes.
TRANSACTION DETAILS
Refer to the "Transaction Details" section beginning on page 51 of the
Class A, Class T, and Class B Prospectus for information about share price
calculation.
THE OFFERING PRICE (price to buy one share) is Class B's NAV. The
REDEMPTION PRICE (price to sell one share) is Class B's NAV, minus any
applicable CDSC.
CONTINGENT DEFERRED SALES CHARGE. Class B shares may, upon redemption, be
assessed a CDSC based on the following schedules:
From Date of Purchase Contingent
Deferred
Sales Charge
Less than 1 year 5%
1 year to less than 2 years 4%
2 years to less than 3 years 3%
3 years to less than 4 years 3%
4 years to less than 5 years 2%
5 years to less than 6 years 1%
6 years to less than 7 years[A] 0%
[A] AFTER A MAXIMUM HOLDING PERIOD OF SEVEN YEARS, CLASS B SHARES
WILL CONVERT AUTOMATICALLY TO CLASS A SHARES OF THE SAME FIDELITY
ADVISOR FUND. SEE "CONVERSION FEATURE" BELOW FOR MORE INFORMATION.
When exchanging Class B shares of one fund for Class B shares of another
Fidelity Advisor fund or Class B shares of Daily Money Fund: U.S. Treasury
Portfolio, your Class B shares retain the CDSC schedule in effect when they
were originally purchased.
Investment professionals with whom FDC has agreements receive as
compensation from FDC a concession equal to 4 .00% of your purchase
of Class B shares.
The CDSC will be calculated based on the lesser of the cost of Class B
shares at the initial date of purchase or the value of Class B shares at
redemption, not including any reinvested dividends or capital gains. Class
B shares acquired through distributions (dividends or capital gains) will
not be subject to a CDSC. In determining the applicability and rate of any
CDSC at redemption, Class B shares representing reinvested dividends and
capital gains, if any, will be redeemed first, followed by Class B shares
that have been held for the longest period of time.
CONVERSION FEATURE. After a maximum holding period of seven years
from the initial date of purchase, Class B shares and any capital
appreciation associated with those shares, convert automatically to Class
A shares of the same Fidelity Advisor fund. Conversion to Class A
shares will be made at NAV. At the time of conversion, a portion of the
Class B shares purchased through the reinvestment of dividends or capital
gains (Dividend Shares) will also convert to Class A shares. The
portion of Dividend Shares that will convert is determined by the ratio of
your converting Class B non-Dividend Shares to your total Class B
non-Dividend Shares.
For more information about the CDSC, including the conversion feature and
the permitted circumstances for CDSC waivers, contact your investment
professional.
Refer to the "Transaction Details" section beginning on page 51 of the
Class A, Class T, and Class B Prospectus for more information about the
timing of purchases and redemptions.
EXCHANGE RESTRICTIONS
Refer to the "Exchange Restrictions section beginning on page 55 of the
Class A, Class T, and Class B Prospectus for information about exchange
privileges and restrictions.
SALES CHARGE REDUCTIONS AND WAIVERS
Refer to the "Sales Charge Reductions and Waivers" section beginning on
page 55 of the Class A, Class T, and Class B Prospectus for information
about sales charge reductions and waivers.
FIDELITY ADVISOR EQUITY GROWTH FUND: CLASS B
A FUND OF FIDELITY ADVISOR SERIES I
FIDELITY ADVISOR BALANCED FUND (FORMERLY ADVISOR INCOME & GROWTH FUND):
CLASS B
A FUND OF FIDELITY ADVISOR SERIES II
STATEMENT OF ADDITIONAL INFORMATION
NOVEMBER 29, 1996
This Statement of Additional Information (SAI) is not a prospectus but
should be read in conjunction with the funds' current Prospectus (dated
November 29, 1996). Please retain this document for future reference. Only
Class B shares are discussed in this SAI. Class A, Class T, and
Institutional Class shares of each fund are discussed in the Fidelity
Advisor Funds Class A, Class T, Class B and Institutional Class SAI (dated
August 30, 1996), which is a part hereof. Throughout this SAI, the Fidelity
Advisor Class A, Class T, Class B and Institutional Class SAI dated August
30, 1996, is referred to as the "Class A, Class T, Class B and
Institutional Class SAI." To obtain an additional copy of the Prospectus,
please call Fidelity Distributors Corporation, 82 Devonshire Street,
Boston, Massachusetts 02109 or your investment professional.
TABLE OF CONTENTS PAGE
Investment Policies and Limitations
Portfolio Transactions
Valuation
Performance
Additional Purchase, Exchange, and Redemption Information
Distributions and Taxes
FMR
Trustees and Officers
Management Contracts
Contracts with FMR Affiliates
Distribution and Service Plans
Description of the Trusts
Financial Statements
INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc. (FMR U.K.)
Fidelity Management & Research (Far East) Inc. (FMR Far East)
DISTRIBUTOR
Fidelity Distributors Corporation (FDC)
TRANSFER AGENT
Fidelity Investments Institutional Operations Company (FIIOC)
ACOMB- disb -1196
INVESTMENT POLICIES AND LIMITATIONS
Refer to the "Investment Policies and Limitations" section beginning on
page 3 of the Class A, Class T, Class B, and Institutional Class SAI for
more information about each fund's investment policies and limitations.
PORTFOLIO TRANSACTIONS
Refer to the "Portfolio Transactions" section beginning on page 61 of the
Class A, Class T, Class B, and Institutional Class SAI for more information
about how each fund's transactions in portfolio securities are affected and
the brokerage commissions paid by each fund.
VALUATION
Refer to the "Valuation" section beginning on page 64 of the Class A, Class
T, Class B, and Institutional Class SAI for information on how each fund's
assets are valued.
PERFORMANCE
HISTORICAL FUND RESULTS. The following table shows the total returns for
Class B of each fund for the semi-annual period ended 1996 as indicated
(Class B of each fund will commence on or about December 31, 1996).
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Average Annual Total Returns [A] Cumulative Total Returns [A]
6 Months One Five Ten Past 6 One Five Ten
Ended Year Years Years/Life Months Year Years Years/Life
of Fund[D] of Fund[D]
Equity Growth - 5/31 29.47% 17.10% 17.74% 5.37% 29.47% 120.16% 411.89%
Class B [B]
Balanced - 4/30 2.58% 9.69% 11.21% -2.34% 2.58% 58.80% 169.35%
Class B [C]
</TABLE>
[A] Class B's contingent deferred sales charges included in the past 6
months, one year, past five years, and Ten years/Life of Fund total return
figures are 5%, 5%, 2%, and 0% respectively.
[B] Initial offering of Class B shares of Equity Growth will take place on
or about January 2, 1997. Class B shares bear a 12b-1 fee (including
shareholder servicing fee), which is not reflected in prior return dates.
Returns between January 1, 1996 and May 31, 1996 are those of Class T and
reflect Class T's then applicable 0.50% 12b-1 fee. Returns between
September 10, 1992 and December 31, 1995 are those of Class T and reflect
Class T's then applicable 0.65% 12b-1 fee. Returns prior to September 10,
1992 are those of Institutional Class, the original class of the fund,
which does not bear a 12b-1 fee.
[C] Initial offering of Class B shares of Balanced will take place on or
about January 2, 1997. Class B shares bear a 12b-1 fee (including
shareholder servicing fee), which is not reflected in prior return dates.
Returns between January 1, 1996 and April 30, 1996 are those of Class T and
reflect Class T's then applicable 0.50% 12b-1 fee. Returns between January
6, 1987 and December 31, 1995 are those of Class T and reflect Class T's
then applicable 0.65% 12b-1 fee.
[D] Life of fund figures for Balanced are from commencement of operations
(January 6, 1987).
The following tables show the income and capital elements of the cumulative
total return for Class B of each fund. The tables compare each fund's Class
B return to the record of the Standard & Poor's 500 Index (S&P
500(registered trademark)), the Dow Jones Industrial Average (DJIA), and
the cost of living (measured by the Consumer Price Index, or CPI) over the
same period. The CPI information is as of the month-end closest to the
initial investment date for the fund. The S&P 500 and DJIA comparisons are
provided to show how Class B's total return compared to the record of a
broad average of common stocks and a narrower set of stocks of major
industrial companies, respectively, over the same period. Figures for the
S&P 500 and DJIA are based on the prices of unmanaged groups of stocks and,
unlike Class B's returns, do not include the effect of paying brokerage
commissions or other costs of investing.
The following charts show the growth of a hypothetical $10,000 investment
in Class B of each fund, assuming all distributions were reinvested but not
including Class B shares' 12b-1 fees. The charts reflect Class T's then
applicable 12b-1 fees. This was a period of fluctuating interest rates and
bond prices and the figures below should not be considered representative
of the dividend income or capital gain or loss that could be realized from
an investment in a class today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY GROWTH - CLASS B INDICES
Year ended Value of Value of Value of Total S&P 500 DJIA Cost of
November 30* Initial Reinvested Reinvested Value Living**
$10,000 Dividend Capital Gain
Investment Distributions Distributions
1995 $ 35,915 $ 1,728 $ 24,155 $ 61,798 $ 41,199 $ 47,557 $ 14,092
1994 25,717 1,111 16,966 43,794 30,077 34,192 13,752
1993 26,601 1,150 15,360 43,111 29,766 32,779 13,376
1992 23,742 912 12,992 37,646 27,035 28,578 13,028
1991 21,894 800 8,429 31,123 22,814 24,302 12,642
1990 14,022 512 5,398 19,932 18,956 20,777 12,275
1989 15,618 465 3,317 19,400 19,640 21,131 11,550
1988 10,839 40 2,302 13,181 15,010 15,910 11,037
1987 8,945 23 1,189 10,157 12,171 13,310 10,587
1986 11,885 21 349 12,255 12,768 13,479 10,128
</TABLE>
* After a holding period of seven years, Class B shares automatically
convert to Class A shares.
** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Class B of
Equity Growth on November 30, 1985, assuming the CDSC had been in effect,
the net amount invested in Class B shares was $10,000. The cost of the
initial investment ($10,000), together with the aggregate cost of
reinvested dividends and capital gain distributions for the period covered
(their cash value at the time they were reinvested), amounted to $21,739.
If distributions had not been reinvested, the amount of distributions
earned from the class over time would have been smaller, and cash payments
for the period would have amounted to $514 for dividends and $8,215 for
capital gains distributions.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCED - CLASS B INDICES
Year ended Value of Value of Value of Total S&P 500 DJIA Cost of
October 31** Initial Reinvested Reinvested Value Living***
$10,000 Dividend Capital Gain
Investment Distributions Distributions
1995 $ 15,300 $ 7,497 $ 3,439 $ 26,236 $ 30,447 $ 31,938 $ 13,910
1994 14,670 6,358 3,298 24,326 24,080 25,598 13,529
1993 15,910 6,302 2,786 24,998 23,183 23,462 13,186
1992 14,410 4,872 1,609 20,891 20,169 19,977 12,833
1991 14,130 4,119 696 18,945 18,339 18,454 12,434
1990 10,410 2,445 512 13,367 13,736 14,187 12,081
1989 12,770 1,626 0 14,396 14,849 14,782 11,367
1988 11,070 813 0 11,883 11,747 11,572 10,878
1987* 9,440 170 0 9,610 10,232 10,358 10,434
</TABLE>
* From January 6, 1987 (commencement of operations).
** After a holding period of seven years, Class B shares automatically
convert to Class A shares.
*** From month-end closest to initial investment date.
Explanatory Notes: With an initial investment of $10,000 in Class B of
Balanced on January 6, 1987, assuming the CDSC had been in effect, the
net amount invested in Class B shares was $10,000. The cost of the initial
investment ($10,000), together with the aggregate cost of reinvested
dividends and capital gain distributions for the period covered (their cash
value at the time they were reinvested), amounted to $19,273. If
distributions had not been reinvested, the amount of distributions earned
from the class over time would have been smaller, and cash payments for the
period would have amounted to $4,790 for dividends and $2,210 for capital
gains distributions.
Refer to the "Performance" section beginning on page 66 of the Class A,
Class T, Class B, and Institutional Class SAI for more information about
calculating, reporting, and quoting the funds' performance.
ADDITIONAL PURCHASE, EXCHANGE, AND REDEMPTION INFORMATION
Refer to the "Additional Purchase, Exchange, and Redemption Information"
section beginning on page 101 of the Class A, Class T, Class B, and
Institutional Class SAI for information on share price calculations and
sales charge waivers and reductions.
DISTRIBUTIONS AND TAXES
Refer to the "Distributions and Taxes" section beginning on page 103 of the
Class A, Class T, Class B, and Institutional Class SAI for information
about distributions and how they are taxed.
FMR
Refer to the "FMR" section on page 106 of the Class A, Class T, Class B,
and Institutional Class SAI for detailed information about FMR, the
investment adviser of the funds.
TRUSTEES AND OFFICERS
Refer to the "Trustees and Officers" section beginning on page 106 of the
Class A, Class T, Class B, and Institutional Class SAI for detailed
information about the funds' trustees, officers and advisory board members.
MANAGEMENT CONTRACTS
Refer to the "Management Contracts" section beginning on page 113 of the
Class A, Class T, Class B, and Institutional Class SAI for information
about each fund's management contract.
CONTRACTS WITH FMR AFFILIATES
Refer to the "Contracts with FMR Affiliates" section beginning on page 126
of the Class A, Class T, Class B, and Institutional Class SAI for
information about the services that FMR affiliates provide to the funds and
how the affiliates are compensated.
DISTRIBUTION AND SERVICE PLANS
The Trustees have approved Distribution and Service Plans on behalf of
Class B shares of each fund (the Plans) pursuant to Rule 12b-1 under the
1940 Act (the Rule). The Rule provides in substance that a mutual fund may
not engage directly or indirectly in financing any activity that is
primarily intended to result in the sale of shares of a fund except
pursuant to a plan approved on behalf of the fund under the Rule. The
Plans, as approved by the Trustees, allow Class B shares of each fund and
FMR to incur certain expenses that might be considered to constitute direct
or indirect payment by the funds of distribution expenses.
Currently, the Trustees have approved a distribution fee for Class B of
each fund at an annual rate of 0.75% of its average net assets throughout
the month. For the purpose of calculating the distribution fees, average
net assets are determined as of the close of business on each day
throughout the month. These fees may be increased only when, in the opinion
of the Trustees, it is in the best interests of the shareholders of Class B
to do so. Class B of each fund also pays investment professionals a service
fee at an annual rate of 0.25% of its average daily net assets determined
at the close of business on each day throughout the month for personal
service and/or the maintenance of shareholder accounts.
Under each Plan, if the payment of management fees by the funds to FMR is
deemed to be indirect financing by the funds of the distribution of their
shares, such payment is authorized by the Plans. Each Class B Plan
specifically recognizes that FMR may use its management fee revenue, as
well as its past profits or its other resources to pay FDC for expenses
incurred in connection with the distribution of the applicable class,
including payments made to third parties that assist in selling shares of
the applicable class of each fund or to third parties, including banks,
that render shareholder support services. The Trustees have authorized such
payments for Class B of each fund.
Prior to approving each Plan, the Trustees carefully considered all
pertinent factors relating to the implementation of each Plan, and have
determined that there is a reasonable likelihood that the Plan will benefit
the applicable class of each fund and its shareholders. To the extent that
each Plan gives FMR and FDC greater flexibility in connection with the
distribution of shares of Class B of each fund, additional sales of fund
shares may result. Furthermore, certain shareholder support services may be
provided more effectively under the Plans by local entities with whom
shareholders have other relationships.
Class B Plans do not provide for specific payments by the applicable class
of any of the expenses of FDC, or obligate FDC or FMR to perform any
specific type or level of distribution activities or incur any specific
level of expense in connection with distribution activities. After payments
by FDC for advertising, marketing and distribution, and payments to third
parties, the amounts remaining, if any, may be used as FDC may elect.
Refer to page 129 of the Class A, Class T, Class B, and Institutional Class
SAI for information about the distribution and service plans for Class A,
Class T, and Institutional Class.
DESCRIPTION OF THE TRUSTS
Refer to the "Description of the Trusts" section beginning on page 132 of
the Class A, Class T, Class B, and Institutional Class SAI for information
about each Trust's organization, shareholder and Trustee liability, and
voting rights of the funds' shareholders, and custodian and auditor
information.
FINANCIAL STATEMENTS
Refer to the "Financial Statements" section on page 134 of the Class A,
Class T, Class B, and Institutional Class SAI for information about each
fund's financial statements and financial highlights.
