FIDELITY
U.S. BOND INDEX
PORTFOLIO
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how the fund
invests and the services available to shareholders.
To learn more about the fund and its investments, you can obtain a copy of
the fund's most recent financial report and portfolio listing or a copy of
the Statement of Additional Information (SAI) dated April 19, 1995. The SAI
has been filed with the Securities and Exchange Commission (SEC) and is
incorporated herein by reference (legally forms a part of the prospectus).
For a free copy of either document, or for information or assistance in
opening a new account , call the appropriate number listed below or
call your Investment Professional.
INDIVIDUAL ACCOUNTS (PARTICIPANT)
If you are investing through a retirement plan sponsor or other
institution, refer to your plan materials or contact that institution
directly.
RETIREMENT PLAN LEVEL ACCOUNTS
(TRUSTEES, PLAN SPONSORS)
Corporate Clients 800-962-1375
"Not for Profit" Clients 800-343-0860
FINANCIAL AND OTHER INSTITUTIONS
Nationwide 800-843-3001
MUTUAL FUND SHARES ARE NOT DEPOSITS OR
OBLIGATIONS OF, OR GUARANTEED BY, ANY
DEPOSITORY INSTITUTION. SHARES ARE NOT
INSURED BY THE FDIC, THE FEDERAL RESERVE
BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT
TO INVESTMENT RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL.
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.
UBI-pro-495
A fund of Fidelity Institutional Trust
The fund seeks to provide investment results that correspond to the
aggregate price and interest performance of the debt securities in the
Lehman Brothers Aggregate Bond Index (the Aggregate Bond Index).
PROSPECTUS
DATED APRIL 19, 1995(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON,
MA 02109
AND
ANNUAL REPORT
FOR THE PERIOD ENDING
FEBRUARY 28, 1995
CONTENTS
PROSPECTUS
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KEY FACTS WHO MAY WANT TO INVEST
EXPENSES The fund's yearly operating expenses.
FINANCIAL HIGHLIGHTS A summary of the fund's
financial data.
PERFORMANCE How the fund has done over time.
THE FUND IN DETAIL CHARTER How the fund is organized.
INVESTMENT PRINCIPLES AND RISKS The 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
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ANNUAL REPORT
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PERFORMANCE A-1 How the fund has done over time.
FUND TALK A-4 The manager's review of fund performance, strategy
and outlook.
INVESTMENTS A-6 A complete list of the fund's investments with their
market values.
FINANCIAL STATEMENTS A-11 Statement of assets and liabilities, operations, and
changes in net assets.
NOTES A-14 Notes to the financial statements.
REPORT OF INDEPENDENT ACCOUNTANTS A-16 The auditor's opinion.
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KEY FACTS
WHO MAY WANT TO INVEST
The fund may be appropriate for investors who seek investment
results that correspond to those of an index that includes various types of
domestic and foreign medium to high quality debt obligations, with
reasonable consistency over time .
Because the fund seeks to track, rather than beat, the performance of the
Aggregate Bond Index , the fund is not managed in the same manner as
other mutual funds. FMR generally does not judge the merits of any
particular debt security as an investment. Therefore, you should not
expect to achieve the potentially greater results that could be obtained by
a fund that aggressively seeks income.
The value of the fund's investments and the income the y generate
vary from day to day, and generally reflect changes in interest rates,
market conditions, and other economic and political news. The fund's
investments are also subject to prepayments of principal, which can lower
the fund's yield, particularly in periods of declining interest rates.
The fund is not in itself a balanced investment plan. You should
consider your investment objective and tolerance for risk when making an
investment decision. When you sell your fund shares, they may be worth
more or less than what you paid for them.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you pay when you buy or sell
shares of a fund.
Maximum sales charge on purchases and None
reinvested distributions
Maximum deferred sales None
charge on redemptions
Redemption fee None
Exchange fee None
ANNUAL OPERATING EXPENSES are paid out of the fund's assets. The fund pays
a management fee to Fidelity Management & Research Company (FMR). The fund
also incurs other expenses for services such as maintaining shareholder
records, and furnishing shareholder account statements and financial
reports.
The fund's expenses are factored into its share price or dividends and are
not charged directly to shareholder accounts (see "Breakdown of Expenses"
on page ).
The following are projections based on historical expenses of the fund, and
are calculated as a percentage of average net assets.
Management fee (after reimbursement) 0.0 7
%
12b-1 fee (Distribution Fee) None
Other expenses 0. 25
%
Total operating expenses (after reimbursement) 0.32
%
EXPENSE TABLE EXAMPLE: You would pay the following expenses on a $1,000
investment assuming (1) a 5% annual return and (2) full redemption, at the
end of each time period:
1 3 5 10
Year Years Years Years
$ 3 $ 10 $ 18 $ 41
THESE EXAMPLES ILLUSTRATE THE EFFECT OF EXPENSES, BUT ARE NOT MEANT TO
SUGGEST ACTUAL OR EXPECTED COSTS OR RETURNS, ALL OF WHICH MAY VARY.
Subject to revision upon 90 days' notice to shareholders, FMR has
voluntarily agreed to reimburse the fund to the extent that total operating
expenses are in excess of 0.32% of its average net assets. If this
agreement were not in effect, the management fee, other expenses, and total
operating expenses would have been 0.32%, 0.25 %, and
0. 57% , respectively, as percentages of average net assets .
Interest, taxes, brokerage commissions, or extraordinary expenses are not
included in this expense limitation.
FINANCIAL HIGHLIGHTS
The financial highlights table that follows and the fund's financial
statements are included in the fund's Annual Report and have been
audited by Price Waterhouse LLP, independent accountants. Their
report on the financial statements and financial highlights is included in
the Annual Report. The financial statements, the financial
highlights, and the report are attached.
SELECTED PER-SHARE DATA
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1.Years ended February 28 1990D 1991E 1992E 1993F 1994 1995
2.Net asset value, beginning of period $ 10.000 $ 10.040 $ 10.710 $ 10.910 $ 11.070 $ 10.830
3.Income from Investment Operations .559 .863 .839 .260 .697 .718
Net investment income
4. Net realized and unrealized gain (loss) on .040 .668 .277 .324 (.110) (.542)
investments
5. Total from investment operations .599 1.531 1.116 .584 .587 .176
6.Less Distributions (.559) (.861) (.836) (.254) (.727) (.756)
From net investment income
7. From net realized gain on investments -- -- (.080) (.170) (.070) --
8. In excess of net realized gain on investments -- -- -- -- (.030) --
9. Total distributions (.559) (.861) (.916) (.424) (.827) (.756)
10.Net asset value, end of period $ 10.040 $ 10.710 $ 10.910 $ 11.070 $ 10.830 $ 10.250
11.Total returnB,C 6.14% 15.86% 10.84% 5.50% 5.38% 1.90%
12.RATIOS AND SUPPLEMENTAL DATA
13.Net assets, end of period (000 omitted) $ 25,600 $ 39,144 $ 86,149 $ 123,351 $ 288,504 $ 354,682
14.Ratio of expenses to average net assets .32%A .32% .32% .32%A .32% .32%
15.Ratio of expenses to average net assets before .84%A .90% .83% .87%A .66% .57%
expense reductions
16.Ratio of net investment income to average net
assets 8.62%A 8.33% 7.70% 7.34%A 6.93% 7.58%
17.Portfolio turnover rate 62%A 50% 113% 89%A 160% 73%
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A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS ON PAGE A-15).
D MARCH 8, 1990 (COMMENCEMENT OF OPERATIONS) TO OCTOBER 31, 1990.
E FOR THE YEAR ENDED OCTOBER 31.
F FOR THE FOUR MONTHS ENDED FEBRUARY 28.
PERFORMANCE
Bond fund performance can be measured as TOTAL RETURN or YIELD. The total
returns and yields that follow are based on historical fund results and do
not reflect the effect of taxes.
The fund's fiscal year runs from March 1 to February 28. The tables below
show the fund's performance history compared to the Aggregate Bond Index
and a measure of inflation.
AVERAGE ANNUAL TOTAL RETURNS
Fiscal periods ended
Past 1
Life of
February 28 , 1995 year [C] fund [A][C]
U.S. Bond Index 1.90% 9.11%
Lehman Brothers
1.78% 8.92% [B]
Aggregate Bond Index
Consumer Price
2.86% 3.34% [B]
Index
CUMULATIVE TOTAL RETURNS
Fiscal periods ended
Past 1
Life of
February 28 , 1995 year[C] fund[A][C]
U.S. Bond Index 1.90% 54.42%
Lehman Brothers
1.78% 52.22% [B]
Aggregate Bond Index
Consumer Price
2.86% 17.89% [B]
Index
[A] FROM MARCH 8, 1990
[B] TOTAL RETURNS ARE FROM MONTH END CLOSEST TO COMMENCEMENT OF OPERATIONS.
[C] IF FMR HAD NOT REIMBURSED CERTAIN FUND EXPENSES DURING THESE PERIODS,
TOTAL RETURNS WOULD HAVE BEEN LOWER.
For the 30-day period ended February 28, 1995, the fund's 30-day yield was
7.50 %.
If FMR had not reimbursed certain fund expenses during these periods, the
30-day yield would have been 7.25 %.
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment in the fund over a
given period, assuming reinvestment of any dividends and capital gains. A
CUMULATIVE TOTAL RETURN reflects actual performance over a stated period of
time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that,
if achieved annually, would have produced the same cumulative total return
if performance had been constant over the entire period. Average annual
total returns smooth out variations in performance; they are not the same
as actual year-by-year results.
YIELD refers to the income generated by an investment in the fund over a
given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all stock and bond
funds. Because this differs from other accounting methods, the quoted yield
may not equal the income actually paid to shareholders.
LEHMAN BROTHERS AGGREGATE BOND INDEX , comprised of the Lehman
Brothers Government Bond Index, Corporate Bond Index and Mortgage-Backed
Securities Index , is a total return index measuring both the capital
price changes and the income underlying the universe of securities weighted
by market value outstanding, and unlike the fund's returns, its returns do
not include the effect of paying brokerage commissions and other costs of
investing.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government.
The fund's recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders.
For current performance call Client Services at the appropriate
number listed on page .
TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN
INDICATION OF FUTURE PERFORMANCE.
THE FUND IN DETAIL
CHARTER
U.S. BOND INDEX IS A MUTUAL FUND: an investment that pools shareholders'
money and invests it toward a specified goal. The fund is a diversified
fund of Fidelity Institutional Trust, an open-end management investment
company organized as a Massachusetts business trust on July 21, 1987.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the fund's activities,
review contractual arrangements with companies that provide services to the
fund, and review the fund's performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These meetings
may be called to elect or remove trustees, change fundamental policies,
approve a management contract, or for other purposes. Shareholders not
attending these meetings are encouraged to vote by proxy. The transfer
agent, will mail proxy materials in advance, including a voting card and
information about the proposals to be voted on. You are entitled to one
vote for each share you own.
FMR AND ITS AFFILIATES
Fidelity Investments is one of the largest investment management
organizations in the United States and has its principal business address
at 82 Devonshire Street, Boston, Massachusetts 02109. It includes a number
of different subsidiaries and divisions which provide a variety of
financial services and products. The fund employs various Fidelity
companies to perform activities required for its operation.
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs.
As of February 28, 1995, FMR advised funds having approximately
20 million shareholder accounts with a total value of more than
$ 270 billion.
Christine Thompson is vice president and manager of U.S. Bond Index,
which she has managed since 1990. She is also responsible for the bond
portions of Balanced and Puritan. Ms. Thompson joined Fidelity in 1985.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corp oration (FDC) distributes and markets
Fidelity's funds and services. Fidelity Investments Institutional
Operations Company (FIIOC) performs transfer agent servicing functions for
the fund.
FMR Corp. is the ultimate parent company of FMR. Through ownership of
voting common stock, members of the Edward C. Johnson 3d family form a
controlling group with respect to FMR Corp. Changes may occur in the
Johnson family group, through death or disability, which would result in
changes in each individual family member ' s holding of stock. Such
changes could result in one or more family members becoming holders of over
25% of the stock. FMR Corp. has received an opinion of counsel that changes
in the composition of the Johnson family group under these circumstances
would not result in the termination of the fund's management or
distribution contracts and, accordingly, would not require a shareholder
vote to continue operation under those contracts.
To carry out the fund's transactions, FMR may use its broker-dealer
affiliates and other firms that sell fund shares, provided that the fund
receives services and commission rates comparable to those of other
broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
The fund seeks to match the performance of the Aggregate Bond Index while
keeping expenses low. FMR normally invests at least 80% of its assets in
securities included in the Aggregate Bond Index. If the fund's assets drop
below $50 million, the percentage of the fund's assets invested in such
securities may drop to as low as 65%.
The Aggregate Bond Index is comprised of the Lehman Brothers Government
Bond Index, Corporate Bond Index and Mortgage-Backed Securities Index.
Inclusion of a security in the Aggregate Bond Index in no way implies an
opinion by Lehman Brothers, Inc. as to its attractiveness or
appropriateness as an investment for the fund. Lehman Brothers, Inc. is
neither an affiliate nor a sponsor of the fund and inclusion of a security
in the Aggregate Bond Index does not imply that it is a good investment. In
seeking a 90% or better correlation of the fund's performance to that of
the Aggregate Bond Index, the fund utilizes a "passive" or "indexing"
approach and tries to allocate its assets similarly to those of the
Aggregate Bond Index. The fund's composition may not always be identical to
that of the Aggregate Bond Index.
FMR will attempt to maintain the weightings of securities held by the fund
to correspond to their respective weighting in the Aggregate Bond Index.
FMR expects to be able to invest within +/-10% of the actual Aggregate Bond
Index weighting of broad market sectors.
FMR monitors the correlation between the performance of the fund and the
Aggregate Bond Index on a regular basis. In the unlikely event that the
fund cannot achieve a correlation of 90% or better, the Trustees will
consider alternative investment arrangements. The fund's ability to
duplicate the performance of the Aggregate Bond Index will depend, to some
extent, on the size and frequency of cash flow into and out of the fund.
The fund's yield and share price change daily and are based on changes in
domestic or foreign interest rates and in an issuer's creditworthiness. In
general, bond prices rise when interest rates fall, and vice versa. This
effect is usually more pronounced for longer-term securities. General
economic and political factors in the various world markets can also impact
the value of your investment. FMR may use various investment techniques to
hedge the fund's risk, but there is no guarantee that these strategies will
work as intended. When you sell your shares, they may be worth more or less
than what you paid for them.
FMR normally invests the fund's assets according to its investment
strategy. The fund also reserves the right to invest without limitation in
investment-grade money market or short-term debt instruments for temporary,
defensive purposes.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, and strategies FMR may employ in
pursuit of the fund's investment objective. A summary of risks and
restrictions associated with these instrument types and investment
practices is included as well. A complete listing of the fund's policies
and limitations and more detailed information about the fund's investments
is contained in the fund's SAI. Policies and limitations are considered at
the time of purchase; the sale of instruments is not required in the event
of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques to
the full extent permitted unless it believes that doing so will help the
fund achieve its goal. Current holdings and recent investment strategies
are described in the fund's financial reports, which are sent to
shareholders twice a year. For a free SAI , call the appropriate
number listed on page P- 12.
DEBT SECURITIES. Bonds and other debt instruments are used by issuers to
borrow money from investors. The issuer pays the investor a fixed or
variable rate of interest, and must repay the amount borrowed at maturity.
Some debt securities, such as zero coupon bonds, do not pay current
interest, but are purchased at a discount from their face values. Debt
securities, loans, and other direct debt have varying degrees of quality
and varying levels of sensitivity to changes in interest rates. Longer-term
bonds are generally more sensitive to interest rate changes than short-term
bonds.
Investment-grade debt securities are medium- and high-quality securities.
Some, however, may possess speculative characteristics and may be more
sensitive to economic changes and to changes in the financial condition of
issuers.
MONEY MARKET INSTRUMENTS are high-quality instruments that present minimal
credit risk. They may include U.S. Government obligations, commercial paper
and other short-term corporate obligations, and certificates of deposit,
bankers' acceptances, bank deposits, and other financial institution
obligations. These instruments may carry fixed or variable interest rates.
U.S. GOVERNMENT SECURITIES are high-quality debt securities issued or
guaranteed by the U.S. Treasury or by an agency or instrumentality of the
U.S. G overnment. Not all U.S. G overnment securities are
backed by the full faith and credit of the United States. For example,
securities issued by the Federal Farm Credit Bank or by the Federal
National Mortgage Association are supported by the instrumentality's right
to borrow money from the U.S. Treasury under certain circumstances.
However, securities issued by the Financing Corporation are supported only
by the credit of the entity that issued them.
EXPOSURE TO FOREIGN MARKETS. Foreign securities and securities issued by
U.S. entities with substantial foreign operations may involve additional
risks and considerations. These include risks relating to political or
economic conditions in foreign countries, withholding or other taxes,
operational risks, increased regulatory burdens, and the potentially less
stringent investor protection and disclosure standards of foreign markets.
Additionally, governmental issuers of foreign securities may be unwilling
to repay principal and interest when due, and may require that the
conditions for payment be renegotiated. All of these factors can make
foreign investments, especially those in developing countries, more
volatile.
RESTRICTION: The fund may only invest in U.S. dollar-denominated foreign
securities.
AMERICAN DEPOSITARY RECEIPTS AND EUROPEAN DEPOSITARY RECEIPTS (ADRS AND
EDRS) are certificates evidencing ownership of shares of a foreign-based
issuer held in trust by a bank or similar financial institution. Designed
for use in U.S. and European securities markets, respectively, ADRs and
EDRs are alternatives to the purchase of the underlying securities in their
national markets and currencies.
ASSET-BACKED SECURITIES represent interests in pools of lower rated debt
securities, or consumer loans. The value of these securities may be
significantly affected by changes in the market's perception of the issuers
and the creditworthiness of the parties involved.
MORTGAGE SECURITIES are interests in pools of commercial or residential
mortgages, and may include complex instruments such as collateralized
mortgage obligations and stripped mortgage-backed securities. Mortgage
securities may be issued by the U.S. G overnment or by private
entities. For example, Ginnie Maes are interests in pools of mortgage loans
insured or guaranteed by a U.S. G overnment agency. Because mortgage
securities pay both interest and principal as their underlying mortgages
are paid off, they are subject to prepayment risk. This is especially true
for stripped securities. Also, the value of a mortgage security may be
significantly affected by changes in interest rates. Some mortgage
securities may have a structure that makes their reaction to interest rates
and other factors difficult to predict, making their value highly volatile.
STRIPPED SECURITIES are the separate income or principal components of a
debt security. Their risks are similar to those of other debt
securities, although they may be more volatile and the value of certain
types of stripped securities may move in the same direction as interest
rates.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a security
at one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices, interest
rates, or other factors that affect security values. These
techniques may involve derivative transactions such as buying and selling
options and futures contracts, entering into swap agreements and
purchasing indexed securities.
FMR can use these practices to adjust the risk and return characteristics
of the fund's portfolio of investments. If FMR judges market conditions
incorrectly or employs a strategy that does not correlate well with the
fund's investments, these techniques could result in a loss, regardless of
whether the intent was to reduce risk or increase return. These techniques
may increase the volatility of the fund and may involve a small investment
of cash relative to the magnitude of the risk assumed. In addition, these
techniques could result in a loss if the counterparty to the transaction
does not perform as promised.
DIRECT DEBT. Loans and other direct debt instruments are interests in
amounts owed to another party by a company, government, or other borrower.
They have additional risks beyond conventional debt securities because they
may entail less legal protection for the fund, or there may be a
requirement that the fund supply additional cash to a borrower on demand.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by
FMR, under the supervision of the Board of Trustees, to be illiquid, which
means that they may be difficult to sell promptly at an acceptable price.
The sale of some securities, including illiquid securities, may be subject
to legal restrictions. Difficulty in selling securities may result in a
loss or may be costly to the fund.
RESTRICTIONS. The fund may not purchase a security if, as a result, more
than 10% of its net assets would be invested in illiquid securities.
WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS are trading practices in
which payment and delivery for the securities take place at a future date.
The market value of a security could change during this period, which could
affect the fund's yield.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry. Economic,
business, or political changes can affect all securities of a similar type.
RESTRICTIONS. With respect to 75% of its total assets, the fund may not
purchase a security if, as a result, more than 5% would be
invested in the securities of any one issuer. This limitation
does not apply to U.S. G overnment securities.
BORROWING. The fund may borrow from banks or from other funds advised by
FMR, or through reverse repurchase agreements. If the fund borrows money,
its share price may be subject to greater fluctuation until the borrowing
is paid off. If the fund makes additional investments while borrowings are
outstanding, this may be considered a form of leverage.
RESTRICTIONS: The fund may borrow only for temporary or emergency purposes,
but not in an amount exceeding 33% of its total assets.
LENDING. Lending securities to broker-dealers and institutions, including
Fidelity Brokerage Services, Inc. (FBSI) , an affiliate of FMR, is a
means of earning income. This practice could result in a loss or a delay in
recovering the fund's securities. The fund may also lend money to other
funds advised by FMR and to issuers in connection with certain direct debt
transactions.
RESTRICTIONS: Loans, in the aggregate, may not exceed 33% of the fund's
total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
The fund seeks to provide investment results that correspond to the
aggregate price and interest performance of the debt securities in the
Aggregate Bond Index .
With respect to 75% of its total assets, the fund may not purchase a
security if, as a result, more than 5% would be invested in the
securities of any issuer.
The fund may borrow only for temporary or emergency purposes, but not in an
amount exceeding 33% of its total assets.
Loans, in the aggregate, may not exceed 33% of the fund's total assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily operations.
Expenses paid out of the fund's assets are reflected in its share price or
dividends; they are neither billed directly to shareholders nor deducted
from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. The fund also pays OTHER EXPENSES, which are explained
below.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fund pays
the fee at the annual rate of 0.32% of its average net assets.
OTHER EXPENSES
While the management fee is a significant component of each fund's annual
operating costs, the fund has other expenses as well.
FIIOC performs transfer agency, dividend disbursing and shareholder
servicing functions for the fund. Fidelity Service Co. (FSC) calculates the
net asset value per share (NAV) and dividends for the fund,
maintains the fund's general accounting records , and administers the
fund's securities lending program. In fiscal 199 5 , the fund paid
FIIOC and FSC fees equal to 0.16 % (before reimbursement, if
any) and 0.04 % (before reimbursement, if any) ,
respectively, of the fund's average net assets.
The fund has adopted a DISTRIBUTION AND SERVICE PLAN. This plan
recognizes that FMR may use its resources, including management fees, to
pay expenses associated with the sale of fund shares. This may include
payments to third parties, such as banks or broker-dealers, that provide
shareholder support services or engage in the sale of the fund's shares.
The Board of Trustees has not authorized such payments. The fund does not
pay FMR any separate fees for this service.
The fund also pays other expenses, such as legal, audit, and custodian
fees; in some instances, proxy solicitation costs; and the
compensation of trustees who are not affiliated with Fidelit y.
The fund's portfolio turnover rate for fiscal 1995 was 73 %. This
rate varies from year to year.
YOUR ACCOUNT
TYPES OF ACCOUNTS
If you invest through an Investment Professional, read that Investment
Professional's program materials in conjunction with this prospectus for
additional service features or fees that may apply. Certain features of
the fund, such as minimum initial or subsequent investment amounts, may be
modified in these programs, and administrative charges may be imposed for
the services rendered.
The different ways to set up (register) your account with Fidelity are
listed below.
The account guidelines that follow may not apply to certain retirement
accounts. If your employer offers the fund through a retirement program,
contact your employer. Otherwise, call your Fidelity toll-free
retirement number .
WAYS TO SET UP YOUR ACCOUNT
TRUST
FOR MONEY BEING INVESTED BY A TRUST.
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS.
For more specific information, call the appropriate number listed on page .
TAX SAVING RETIREMENT PLANS. Fidelity can set up your new account in the
fund under one of several tax-sheltered plans. These plans let you save for
retirement and shelter your investment income from current taxes. Minimums
may differ from those listed on page , and the corresponding information
may not apply. Retirement plan participants should refer to their
retirement plan's guidelines for further information.
(solid bullet) DEFINED CONTRIBUTION PLANS, such as 401(k) Plan,
employer-sponsored IRA programs, Thrift, Keogh or Corporate Profit-Sharing
or Money-Purchase Plans: open to self-employed people and their partners or
to corporations, to benefit themselves and their employees.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are open to employees of most
non-profit organizations.
(solid bullet) DEFINED BENEFIT PLANS are open to corporations of all sizes
to benefit their employees.
(solid bullet) 457 PLANS are open to employees of most government agencies.
(solid bullet) ROLLOVER IRAS retain special tax advantages for certain
distributions from employer-sponsored retirement plans.
HOW TO BUY SHARES
THE FUND'S SHARE PRICE, called NAV, is calculated every business day. The
fund's shares are sold without a sales charge.
Shares are purchased at the next NAV calculated after your order is
received and accepted by the transfer agent . NAV is normally
calculated at 4:00 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application and
mail it along with your check. You may also open your account by wire as
described on page . If there is no account application accompanying
this prospectus, call the appropriate number listed on page .
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail an account application with a check,
(small solid bullet) Open your account by exchanging from another
Fidelity fund,
(small solid bullet) Wire money into your account, or
(small solid bullet) Contact your Investment Professional.
If you buy shares by check or Fidelity Money Line(registered trademark),
and then sell those shares by any method other than by exchange to another
Fidelity fund, the payment may be delayed for up to seven business days to
ensure that your previous investment has cleared.
SECURITIES EXCHANGE. Shares of the fund may be purchased in exchange for
securities you hold which meet the fund's investment objective,
policies and limitations. FDC reserves the right to refuse a securities
exchange for any reason. You may realize a gain or loss for federal
income tax purposes upon a securities exchange.
For further information call Client Services at the appropriate telephone
number on page . DO NOT SEND SECURITIES TO THE FUND OR TO
FDC.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $100,000
TO ADD TO AN ACCOUNT $2,500
MINIMUM BALANCE $100,000
FOR INFORMATION OR ASSISTANCE IN OPENING A NEW ACCOUNT:
<TABLE>
<CAPTION>
<S> <C> <C>
18.Initial Investment Corporate Retirement Plans 800-962-1375
(Client Services) 800-343-0860
"Not for Profit" Retirement Plans 800-843-3001
Financial and Other Institutions
Additional Investment Corporate Retirement Plans 800- 962 - 1375
( Client Services ) 800-343-0860
"Not for Profit" Retirement Plans 800-343-6310
Financial and Other Institutions
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
TO 19. OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
PHONE (small solid bullet) Exchange from
another Fidelity fund (small solid bullet) Exchange from another Fidelity
account with the same registration, fund account with the same
including name, address, and registration, including name,
taxpayer ID number. address, and taxpayer ID number.
(phone_graphic) (small solid bullet) Use Fidelity Money Line(registered trademark) to
transfer from your bank account.
Call before your first use to verify
that this service is in place on your
account. Minimum Money Line:
$250 . Maximum Money Line:
$50,000
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Mail (mail_graphic) (small solid bullet) Complete and sign the
account (small solid bullet) Make your check payable to
application. Make your check "Fidelity U.S. Bond Index Portfolio."
payable to "Fidelity U.S. Bond Index Indicate your fund account number
Portfolio." Mail to the address on your check and mail to the
indicated on the application. address printed on your account
statement.
(small solid bullet) C all the appropriate number listed
above for instructions.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Wire (wire_graphic) (small solid bullet) Call the appropriate
number listed (small solid bullet) You must sign up for the wire
above to set up your account and to feature before using it. Call the
arrange a wire transaction. appropriate number listed above for
instructions.
(small solid bullet) Call Client Services
before 4:00 p.m. (small solid bullet) Call Client Services before 4:00
Eastern time. p.m. Eastern Time.
</TABLE>
HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares. Your shares will be sold at
the next NAV calculated after your order is received and accepted by the
transfer agent . NAV is normally calculated at 4:00 p.m. Eastern time.
If you are selling shares of the fund as offered through an
employer-sponsored retirement plan, please contact your employer or call
your Fidelity toll-free retirement plan number.
TO SELL SHARES IN AN ACCOUNT, you may use any of the methods described on
these two pages.
TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE(registered trademark),
you will need to sign up for these services in advance.
TO SELL SHARES IN A RETIREMENT ACCOUNT, your request must be made in
writing, except for exchanges to other Fidelity funds, which can be
requested by phone or in writing.
IF YOU ARE SELLING SOME, BUT NOT ALL OF YOUR SHARES, leave at least
$100,000 worth of shares in the account to keep it open.
CERTAIN REQUESTS MUST INCLUDE A SIGNATURE GUARANTEE. It is designed to
protect you and Fidelity from fraud. Your request must be made in writing
and include a signature guarantee if any of the following situations apply:
(small solid bullet) You wish to redeem more than $100,000 worth of shares,
(small solid bullet) Your account registration has changed within the last
30 days,
(small solid bullet) The check is being mailed to a different address than
the one on your account (record address),
(small solid bullet) The check is being made payable to someone other than
the account owner, or
(small solid bullet) The redemption proceeds are being transferred to a
Fidelity account with a different registration.
(small solid bullet) You wish to have redemption proceeds wired to a
non-predesignated bank account.
You should be able to obtain a signature guarantee from a bank,
broker - dealer, credit union (if authorized under state law),
securities exchange or association, clearing agency, or savings
association. A notary public cannot provide a signature guarantee.
SELLING SHARES IN WRITING
Write a "letter of instruction" with:
(small solid bullet) Your name,
(small solid bullet) The fund's name,
(small solid bullet) Your fund account number,
(small solid bullet) The dollar amount or number of shares to be redeemed,
and
(small solid bullet) Any other applicable requirements listed in the
following table.
Mail your letter to the following address:
Fidelity U.S. Bond Index Portfolio
Fidelity Investments Institutional Operations Company
P.O. Box 1182
Boston, MA 02103-1182
Unless otherwise instructed, the transfer agent will send a check to the
record address.
ACCOUNT TYPE SPECIAL REQUIREMENTS
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<S> <C> <C>
PHONE All account types , except retirement (small solid bullet) Maximum check request: $100,000.
(small solid bullet) For Fidelity Money
Line (registered trademark) transfers
to your bank account: Minimum:
$2,500. Maximum: $50,000.
(phone_graphic) (small solid bullet) You may exchange to other Fidelity
funds if both accounts are
registered with the same name(s),
address, and taxpayer ID number.
(phone_graphic)
Retirement account (small solid bullet) If you have invested through an
employer-sponsored retirement
plan, contact your employer or call
the appropriate number listed on
page .
Mail or in Person
(mail_graphic)
(hand_graphic) Retirement account (small solid bullet) The account owner should complete
a retirement distribution form. Call
the appropriate number listed on
Trust page or your Fidelity toll-free
retirement number.
(small solid bullet) The trustee must sign the letter
indicating capacity as trustee. If the
trustee's name is not in the account
registration, provide a copy of the
trust document certified within the last
60 days with a signature guaranteed
letter.
Business or Organization (small solid bullet) At least one person authorized by
corporate resolution to act on the
account must sign the letter. Must
be accompanied by a signature
guarantee.
Wire
(wire_graphic) All account types (small solid bullet) You must sign up for the wire
feature before using it. Call the
appropriate number listed on page
to verify that it is in place.
Minimum wire: $100,000
(small solid bullet) Your wire redemption request must
be received by the transfer agent
before 4:00 p.m. Eastern time for
money to be wired on the next
business day.
</TABLE>
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired:
1-800-544-0118
INVESTOR SERVICES
Fidelity provides a variety of services to help you manage your account.
INFORMATION SERVICES
STATEMENTS AND REPORTS that Fidelity sends to you include the following:
(small solid bullet) Confirmation statements (after every transaction,
except a reinvestment, that affects your account balance or your account
registration)
(small solid bullet) Account statements (quarterly for retirement plans ,
monthly for all others)
(small solid bullet) Financial reports (every six months)
To reduce expenses, only one copy of most financial reports will be mailed,
even if you have more than one account in the fund. Call the appropriate
number listed on page if you need additional copies of financial
reports.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of other
Fidelity funds by telephone or in writing.
Note that exchanges out of the fund are limited to four per calendar year,
and that they may have tax consequences for you. For details on policies
and restrictions governing exchanges, including circumstances under which a
shareholder's exchange privilege may be suspended or revoked, see
"Exchange Restrictions," page .
FIDELITY MONEY LINE(registered trademark) enables you to transfer money by
phone between your bank account and your fund account. Most transfers are
complete within three business days of your call.
SHAREHOLDER AND ACCOUNT POLICIES
DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net investment income and
capital gains to shareholders each year. Income dividends are declared
daily and paid monthly. Capital gains are normally distributed in December.
DISTRIBUTION OPTIONS
When you open an account, specify on your account application how you want
to receive your distributions. The fund offers three options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions will
be automatically reinvested in additional shares of the fund. If you do not
indicate a choice on your application, you will be assigned this option.
2. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested in additional shares of the fund, but you will be
sent a check for each dividend distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions.
For retirement accounts, all distributions are automatically reinvested.
When you are over 59 1/2 years old, you can receive distributions in cash.
Dividends will be reinvested at the fund's NAV on the last day of the
month. Capital gain distributions will be reinvested at the NAV as of the
date the fund deducts the distribution from its NAV. The mailing of
distribution checks will begin within seven days.
TAXES
As with any investment, you should consider how your investment in the fund
will be taxed. If your account is not a tax-deferred retirement account,
you should be aware of these tax implications.
TAXES ON D ISTRIBUTIONS. Distributions are subject to federal income
tax, and may also be subject to state or local taxes. If you live outside
the United States, your distributions could also be taxed by the country in
which you reside. Your distributions are taxable when they are paid,
whether you take them in cash or reinvest them. However, distributions
declared in December and paid in January are taxable as if they were paid
on December 31.
For federal tax purposes, the fund's income and short-term capital gain
distributions are taxed as dividends; long-term capital gain distributions
are taxed as long-term capital gains.
During fiscal 1995, 42.9% of the fund's income distributions was derived
from interest on U.S. Government securities which is generally exempt from
state income tax.
Every January, Fidelity will send you and the IRS a statement showing the
taxable distributions paid to you in the previous year.
TAXES ON TRANSACTIONS. Your redemptions-including exchanges-are subject to
capital gains tax. A capital gain or loss is the difference between the
cost of your shares and the price you receive when you sell them.
Whenever you sell shares of the fund, Fidelity will send you a confirmation
statement showing how many shares you sold and at what price.
You will also receive a consolidated transaction statement at least
quarterly. However, it is up to you or your tax preparer to determine
whether this sale resulted in a capital gain and, if so, the amount of tax
to be paid. BE SURE TO KEEP YOUR REGULAR ACCOUNT STATEMENTS; the
information they contain will be essential in calculating the amount of
your capital gains.
"BUYING A DIVIDEND." If you buy shares just before the fund deducts a
distribution from its NAV, you will pay the full price for the shares and
then receive a portion of the price back in the form of a taxable
distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the fund
and its investments and these taxes generally will reduce the fund's
distributions.
There are tax requirements that all funds must follow in order to avoid
federal taxation. In its efforts to adhere to these requirements, the fund
may have to limit its investment activity in some types of instruments.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE)
is open. FSC normally calculates the fund's NAV as of the close of business
of the NYSE, normally 4:00 p.m. Eastern time.
THE FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and dividing the result by the number of
shares outstanding.
The fund's assets are valued primarily on the basis of market quotations.
If quotations are not readily available, or if the values have been
materially affected by events occurring after the closing of a foreign
market, assets are valued by a method that the Board of Trustees believes
accurately reflects fair value.
THE FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION PRICE
(price to sell one share) are its NAV.
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that
your social security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require a fund to
withhold 31% of your taxable distributions and redemptions.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does not
follow reasonable procedures designed to verify the identity of the caller.
Fidelity will request personalized security codes or other information, and
may also record calls. You should verify the accuracy of the confirmation
statements immediately after receipt. If you do not want the ability to
redeem and exchange by telephone, call Fidelity for instructions.
Additional documentation may be required from corporations, associations
and certain fiduciaries.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods
of unusual market activity), consider placing your order by mail.
THE FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. The fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they would
disrupt management of the fund.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your shares will be purchased at the
next NAV calculated after your request is received and accepted by the
transfer agent . Note the following:
(small solid bullet) All of your purchases must be made in U.S. dollars and
checks must be drawn on U.S. banks.
(small solid bullet) Fidelity does not accept cash.
(small solid bullet) When making a purchase with more than one check, each
check must have a value of at least $50.
(small solid bullet) The fund reserves the right to limit the number of
checks processed at one time.
(small solid bullet) If your check does not clear, your purchase will be
canceled and you could be liable for any losses or fees the fund or
Fidelity has incurred.
(small solid bullet) You begin to earn dividends as of the first
business day following the day of your purchase.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your order is received and accepted. Note the
following:
(small solid bullet) Normally, redemption proceeds will be mailed to you on
the next business day, but if making immediate payment could adversely
affect the fund, it may take up to seven days to pay you.
(small solid bullet) Shares will earn dividends through the date of
redemption; however, shares redeemed on a Friday or prior to a holiday will
continue to earn dividends until the next business day.
(small solid bullet) Fidelity Money Line (registered trademark)
redemptions generally will be credited to your bank account on the second
or third business day after your phone call.
(small solid bullet) The fund may hold payment on redemptions until it is
reasonably satisfied that investments made by check or Fidelity Money
Line (registered trademark) have been collected, which can take up to
seven business days.
(small solid bullet) Redemptions may be suspended or payment dates
postponed when the NYSE is closed (other than weekends or holidays), when
trading on the NYSE is restricted, or as permitted by the SEC.
For purposes of determining the minimum balance, multiple accounts
registered in the same name within the fund will be aggregated.
IF YOUR ACCOUNT BALANCE FALLS BELOW $100,000, you will be given 30 days'
notice to reestablish the minimum balance. If you do not increase your
balance, Fidelity reserves the right to close your account and send the
proceeds to you. Your shares will be redeemed at the NAV on the day your
account is closed.
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging shares of the fund
for shares of other Fidelity funds. However, you should note the following:
(small solid bullet) The fund you are exchanging into must be registered
for sale in your state.
(small solid bullet) You may only exchange between accounts that are
registered in the same name, address, and taxpayer identification number.
(small solid bullet) Before exchanging into a fund, read its prospectus.
(small solid bullet) If you exchange into a fund with a sales charge, you
pay the difference between that fund's sales charge and any sales
charge you have previously paid in connection with the shares you are
exchanging. For example, if you had already paid a sales charge of 2% on
your shares and you exchange them into a fund with a 3% sales charge, you
would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Because excessive trading can hurt fund performance
and shareholders, the fund reserves the right to temporarily or permanently
terminate the exchange privilege of any investor who makes more than four
exchanges out of the fund per calendar year. Accounts under common
ownership or control, including accounts with the same taxpayer
identification number, will be counted together for purposes of the four
exchange limit.
(small solid bullet) The fund reserves the right to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would be
unable to invest the money effectively in accordance with its investment
objective and policies, or would otherwise potentially be adversely
affected.
(small solid bullet) Your exchanges may be restricted or refused if the
fund receives or anticipates simultaneous orders affecting significant
portions of the fund's assets. In particular, a pattern of exchanges that
coincide s with a "market timing" strategy may be disruptive to the
fund.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any time. The
fund reserves the right to terminate or modify the exchange privilege in
the future.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50% on
exchanges. Check each fund's prospectus for details.
No dealer, sales representative or any other person has been authorized
to give any information or to make any representations, other than those
contained in this Prospectus and in the related SAI, in connection with the
offer contained in this Prospectus. If given or made, such other
information or representations must not be relied upon as having been
authorized by the fund or FDC. This Prospectus and the related SAI do not
constitute an offer by the fund or by FDC to sell or to buy shares of the
fund to any person to whom it is unlawful to make such offer.
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 $100,000 investment. A fund's total
return includes changes in a fund's share price, plus reinvestment of any
dividends (or income) and capital gains (the profits the fund earns when it
sells investments that have grown in value). You can also look at the
fund's income to measure performance. If Fidelity had not reimbursed
certain fund expenses during the periods shown, the total returns and
dividends would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1995 PAST 1 LIFE OF
YEAR FUND
Fidelity U.S. Bond Index 1.90% 54.42%
Lehman Brothers Aggregate Bond Index 1.78% n/a
Consumer Price Index 2.86% 17.89%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, or since the fund began on
March 8, 1990. 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 Lehman
Brothers Aggregate Bond index - a broad measure of the U.S. bond market.
This benchmark includes reinvested dividends and capital gains, if any.
Comparing the fund's performance to the consumer price index (CPI) helps
show how your fund did compared to inflation. (The CPI returns begin on the
month end closest to the fund's start date.)
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1995 PAST 1 LIFE OF
YEAR FUND
Fidelity U.S. Bond Index 1.90% 9.11%
Lehman Brothers Aggregate Bond Index 1.78% n/a
Consumer Price Index 2.86% 3.34%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$100,000 OVER LIFE OF FUND
Fidelity U.S. Bond IAggregate Bond Index
03/31/90 100000.00 100000.00
04/30/90 98902.15 99083.85
05/31/90 101848.95 102017.56
06/30/90 103292.33 103654.45
07/31/90 104861.21 105088.32
08/31/90 103552.15 103684.91
09/30/90 104402.79 104542.69
10/31/90 105789.53 105869.96
11/30/90 107912.50 108148.92
12/31/90 109639.20 109834.03
01/31/91 110945.70 111191.76
02/28/91 111681.87 112140.90
03/31/91 112576.10 112912.39
04/30/91 113908.48 114135.62
05/31/91 114705.76 114803.07
06/30/91 114615.94 114744.70
07/31/91 116187.71 116335.90
08/31/91 118683.00 118853.42
09/30/91 121180.33 121261.80
10/31/91 122572.39 122611.92
11/30/91 123844.12 123736.17
12/31/91 127589.07 127410.92
01/31/92 126089.96 125677.60
02/29/92 126777.93 126494.77
03/31/92 126332.43 125781.65
04/30/92 127155.24 126690.18
05/31/92 129563.13 129080.80
06/30/92 131479.58 130857.27
07/31/92 134384.14 133527.05
08/31/92 135838.14 134879.71
09/30/92 137508.21 136478.53
10/31/92 135863.10 134669.07
11/30/92 135802.93 134699.52
12/31/92 137757.57 136841.44
01/31/93 140497.87 139465.54
02/28/93 143334.35 141906.91
03/31/93 143928.50 142498.22
04/30/93 145002.73 143490.51
05/31/93 145185.51 143673.23
06/30/93 147708.59 146277.03
07/31/93 148811.01 147104.35
08/31/93 151228.56 149682.77
09/30/93 151744.95 150093.90
10/31/93 152254.88 150654.76
11/30/93 151011.42 149373.16
12/31/93 151827.71 150182.72
01/31/94 153733.22 152210.44
02/28/94 151041.84 149566.03
03/31/94 147851.92 145878.59
04/30/94 146592.86 144713.73
05/31/94 146472.14 144693.43
06/30/94 146357.37 144373.67
07/31/94 148983.70 147241.40
08/31/94 149184.11 147424.12
09/30/94 147199.82 145254.29
10/31/94 147124.74 145124.86
11/30/94 146887.73 144802.56
12/31/94 147861.21 145802.46
01/31/95 150615.86 148687.95
02/28/95 153906.24 152223.12
$100,000 OVER LIFE OF FUND: Let's say you invested $100,000 in Fidelity
U.S. Bond Index Portfolio on March 31, 1990, shortly after the fund
started. As the chart shows, by February 28, 1995, the value of your
investment would have grown to $153,906 - a 53.91% increase on your initial
investment. For comparison, look at how the Lehman Brothers Aggregate Bond
Index did over the same period. With dividends reinvested, the same
$100,000 would have grown to $152,223 - a 52.22% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is no guarantee of
how it will do tomorrow. Bond prices, for
example, move in the opposite direction of
interest rates. In turn, the share price, return,
and yield of a fund that invests in bonds will
vary. That means if you sell your shares during
a market downturn, you might lose money. But
if you can ride out the market's ups and downs,
you may have a gain.
(checkmark)
DIVIDENDS AND YIELD
PERIODS ENDED FEBRUARY 28, 1995 PAST 1 PAST 6 PAST 1
MONTH MONTHS YEAR
Dividends per share 6.04(cents) 38.36(cents) 75.64(cents)
Annualized dividend rate 7.76% 7.69% 7.39%
30-day annualized yield 7.50% - -
DIVIDENDS per share show the income paid by the fund for a set period and
do not reflect any tax reclassifications. If you annualize this number,
based on an average net asset value of $10.14 over the past month, $10.06
over the past six months and $10.23 over the past year, you can compare the
fund's income over these three periods.
The 30-day annualized YIELD is a standard formula for all bond funds based
on the yields of the bonds in the fund, averaged over the past 30 days.
This figure shows you the yield characteristics of the fund's investments
at the end of the period. It also helps you compare funds from different
companies on an equal basis. It does not reflect the cost of hedging and
other currency gains and losses. If Fidelity had not reimbursed certain
fund expenses during the period shown, the yield would have been 7.25%.
FUND TALK: THE MANAGER'S OVERVIEW
An interview with
Christine
Thompson,
Portfolio Manager
of Fidelity U.S.
Bond Index
Portfolio
Q. CHRISTINE, HOW HAS THE FUND PERFORMED OVER THE PAST 12 MONTHS?
A. Although it was a disappointing year for fixed-income investments, the
fund outpaced its benchmark. For the year ended February 28, 1995, the
fund's total return was 1.90%. That beat the Lehman Brothers Aggregate Bond
Index, which returned 1.78% for the same period.
Q. INTEREST RATES HAVE BEEN RISING DURING MUCH OF THE LAST 12 MONTHS. WHAT
IMPACT HAS THAT HAD ON THE U.S. TAXABLE BOND MARKET?
A. The market's performance in 1994 - as measured by the Lehman Brothers
Aggregate Bond Index - posted negative returns for the first time since its
inception in 1976. Also, last year was the first time since 1976 that the
index's major sub-components - Treasury, agency, corporate and
mortgage-backed securities - all had negative returns in the same year.
Driving bond prices lower were fears of inflation, rising interest rates
and a weak dollar. However, in 1995, the market is off to its strongest
start since 1988. From January 1, 1995, through February 28, 1995, the
index was up 4.40%. Fueling that rally were much weaker-than-expected
January employment numbers and signs of an economic slowdown causing fears
of inflation to wane.
Q. HOW DID INDIVIDUAL SECTORS OF THE MARKET FARE?
A. Sector performance was dictated primarily by duration, which measures a
security's price sensitivity to changes in interest rates. The shorter a
security's duration, the less sensitive its price is to changes in interest
rates. As interest rates rose in 1994, the prices of shorter duration
securities - such as asset-backed and mortgage securities - fell less than
longer duration securities - such as Treasury, agency and corporate
securities. Shorter duration securities also did fairly well, on a relative
basis, during the recent bond market rally. That said, here's how
individual sectors performed during the past 12 months: Treasury
securities, which made up about 47% of the Lehman Brothers Aggregate Bond
Index, returned 1.32%; mortgage-backed securities, at roughly 28% of the
index, returned 2.76%; corporate securities, which were roughly 16% of the
index, returned about 1.40%; agencies, which were just less than 7% of the
index, returned 1.43%; and asset-backed securities, which were just over 1%
of the total, rose 3.13%
Q. THE FUND PERFORMED SLIGHTLY BETTER THAN THE BENCHMARK. WHAT ACCOUNTS FOR
THAT?
A. Primarily, it was individual security selection. Since the index is made
up of more than 4,000 individual securities, it's impractical for the fund
to own everything in the index. Although I keep the fund's sector
weightings approximately in line with the index, within a given sector I
select individual securities based on their relative attractiveness and
their potential to outperform other securities in that sector. For example,
using Fidelity's research resources - which are some of the most extensive
in the industry - I choose among mortgage bonds with the same coupon, or
stated interest rate, but issued in different years. In our view, a Ginnie
Mae bond with a 9% coupon issued in 1986 or 1987 will have a slower rate of
prepayment, and depending on pricing, may be more attractive than a 9%
Ginnie Mae issued in 1994 or 1995. In the corporate sector, I overweighted
bank securities throughout much of 1994 because of their relative
attractiveness. Those bonds performed relatively well last year. I've
recently moved toward a more neutral position in the corporate sector,
reducing the over- and under-weighting of any particular industry.
Q. WHAT'S AHEAD FOR THE FUND?
A. As always, the fund's return largely will be determined by the direction
of interest rates. No matter which way rates go, I'll continue to keep the
fund fully invested. Valuations have continued to compress so there's less
variation in the attractiveness of individual securities and it's more
difficult to find relative value. By that I mean that there isn't as much
difference in the prices of various securities within each sector - based
on credit quality, maturity and structure - as there is usually. In my
view, the fund's performance will probably more closely track the index
than it has over the past 12 months.
FUND FACTS
GOAL: to provide returns consistent with those
of the Lehman Brothers Aggregate Bond Index
SIZE: as of February 28, 1995, more than
$354 million
START DATE: March 8, 1990
MANAGER: Christine Thompson, since 1990;
manager, bond portion of Fidelity Balanced
Fund, since 1993; and Fidelity Puritan Fund,
since 1991; three trust portfolios since March
1995; joined Fidelity in 1985
(checkmark)
CHRISTINE THOMPSON ON HER INVESTMENT STRATEGY:
"I use a technique called stratified sampling,
which entails dividing the benchmark index into
subsectors, or cells, and assembling a portfolio
which replicates the characteristics of each
subsector. One example is duration - which is
a measure of a security's price sensitivity to
changes in interest rates. The duration of the
fund and the distribution of duration is always
set to approximate the index. I determine what
percent of the index falls within a duration of
zero to one year, one to two years, and so on.
The next step is to find securities that will give
the fund the same duration breakdown as the
index. I follow the same procedure for other
security characteristics including, but not
limited to, sector, maturity and credit quality.
"The next step is to pick individual securities,
using Fidelity's research resources. I choose
securities that have the characteristics I need,
and also offer the potential for performing better
than other securities with similar
characteristics. Usually I'm looking at more
than one parameter at a time. For example, I
may need a Treasury security and at the same
time, a security with a 10-year duration. I also
consider current relative prices in a historical
context and how valuations have differed at
various points in the economic cycle."
DISTRIBUTIONS:
A total of 42.9% of the dividends distributed
during the fiscal year was derived from interest
on U.S. Government securities which is
generally exempt from state income tax.
The fund will notify shareholders in January 1996
of the applicable percentage for use in preparing
1995 income tax returns.
INVESTMENTS FEBRUARY 28, 1995
Showing Percentage of Total Value of Investment in Securities
NONCONVERTIBLE BONDS - 22.3%
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
BASIC INDUSTRIES - 0.2%
PAPER & FOREST PRODUCTS - 0.2%
Chesapeake Corp.:
10 3/8%, 10/1/00 Baa3 $ 300,000 $ 330,960
9 7/8%, 5/1/03 Baa3 350,000 384,146
715,106
DURABLES - 0.3%
AUTOS, TIRES, & ACCESSORIES - 0.3%
General Motors Corp. 9 3/4%,
5/15/99 Baa1 1,000,000 1,028,110
ENERGY - 0.8%
ENERGY SERVICES - 0.8%
Petroliam Nasional BHD yankee
6 7/8%, 7/1/03 (b) A2 3,080,000 2,862,829
OIL & GAS - 0.0%
Societe Nationale Elf Aquitaine
7 3/4%, 5/1/99 Aa3 150,000 150,939
TOTAL ENERGY 3,013,768
FINANCE - 16.6%
ASSET-BACKED SECURITIES - 3.2%
Capital Auto Receivables Asset
Trust 5.85%, 1/15/98 Aaa 586,557 574,092
Discover Card Trust 6 1/8%,
5/15/98 A2 1,670,000 1,646,503
Premier Auto Trust 1994-3B
6.80%, 12/02/98 Aa3 1,225,000 1,212,750
Standard Credit Card Master
Trust I:
9%, 8/7/97 A2 120,000 122,670
8 1/4%, 10/7/97 A2 1,750,000 1,771,711
5 1/2%, 9/7/98 A2 760,000 726,750
6 1/4%, 9/7/98 A2 1,545,000 1,502,030
9 1/4%, 9/07/99 A2 1,500,000 1,575,000
7.65%, 2/15/00 A 430,000 432,283
United Federal Savings Bank
Grantor Trust 1994-B
6.975%, 7/10/00 Baa2 1,905,989 1,865,625
11,429,414
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
BANKS - 7.2%
Bank of Boston Corp.:
9 1/2%, 8/15/97 Baa2 $ 179,000 $ 187,055
10.30%, 9/1/00 Baa2 1,461,000 1,519,440
Barnett Bank, Inc. 10 7/8%,
3/15/03 A3 115,000 134,281
Citicorp euro 5.6875%,
7/10/97 (d) A3 110,000 109,880
Corporacion Andina De Fomento
yankee bonds 7 1/4%,
4/30/98 (b) Baa3 3,000,000 2,715,000
Export-Import Bank Korea
7.85%, 11/1/96 A1 500,000 504,175
First Bank Systems, Inc. euro
6.3125%, 11/29/96 (d) A3 2,000,000 1,998,750
First Hawaiian Bank secured
6.930%, 12/1/03 (b) A1 1,000,000 910,600
First Maryland Bancorp
10 3/8%, 8/1/99 Baa1 750,000 819,480
Fleet/Norstar Financial Group, Inc.
9.90%, 6/15/01 A3 1,390,000 1,519,367
Korea Development Bank
6 1/4%, 5/1/00 A1 2,000,000 1,858,640
Manufacturers Hanover Corp.
8 1/2%, 2/15/99 A3 1,045,000 1,070,090
Manufacturers Hanover Trust, NY
euro 6 5/8%, 7/15/97 (d) A3 500,000 499,375
Marine Midland Banks, Inc.
8 5/8%, 3/1/97 Baa1 1,272,000 1,295,646
Merchants National Corp.
9 7/8%, 10/1/99 A2 750,000 808,725
NCNB Corp. 9 3/8%, 9/15/09 A3 2,000,000 2,149,260
Provident Bank 7 1/8%,
3/15/03 Baa2 1,675,000 1,570,246
Shawmut Bank of Boston, NA
euro 6 5/8%, 2/24/97 (d) Baa2 120,000 119,550
Shawmut Corp.:
8 7/8%, 4/1/96 Baa1 950,000 964,032
8 1/8%, 2/1/97 Baa1 680,000 688,983
Shawmut National Corp. 7.20%,
4/15/03 Baa2 1,000,000 949,510
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
FINANCE - CONTINUED
BANKS - CONTINUED
Signet Banking Corp.:
6.4375%, 5/15/97 (d) Baa2 $ 1,400,000 $ 1,377,250
6.4375%, 4/15/98 (d) Baa2 1,000,000 981,250
9 5/8%, 6/1/99 Baa2 966,000 1,021,632
25,772,217
CREDIT & OTHER FINANCE - 2.7%
Ford Motor Credit Co.:
8%, 12/1/96 A2 1,000,000 1,010,700
5 5/8%, 3/3/97 A2 1,250,000 1,210,025
General Motors Acceptance Corp.:
8 1/4%, 8/1/96 Baa1 500,000 504,810
8.15%, 9/17/96 Baa1 1,000,000 1,011,160
7.60%, 1/9/97 Baa1 400,000 400,692
7 3/4%, 1/28/97 Baa1 750,000 752,963
Greyhound Financial Corp.:
8 1/4%, 3/11/97 Baa2 2,000,000 2,029,780
6.95%, 1/28/98 Baa2 750,000 734,858
8 1/2%, 5/1/98 Baa2 1,000,000 1,021,010
MNC Financial, Inc. sub. cap.
notes 9 3/8%, 5/1/97 A3 100,000 103,800
Westinghouse Credit Corp.
8.98%, 6/15/98 Ba1 1,000,000 1,018,210
9,798,008
INSURANCE - 1.8%
Metropolitan Life Insurance Co.
6.30%, 11/1/03 (b) Aa3 3,000,000 2,661,000
Nationwide Mutual Insurance Co.
6 1/2%, 2/15/04 (b) Aa3 1,500,000 1,333,560
New York Life Insurance Co.
6.20%, 12/15/03 (b) Aa2 1,500,000 1,346,850
Protective Life Corp. 7.95%,
7/1/04 A3 1,085,000 1,067,640
6,409,050
SAVINGS & LOANS - 1.7%
Great Western Financial Corp.
6 3/8%, 7/1/00 Baa1 1,000,000 935,160
Home Savings of America:
10 1/4%, 12/5/96 A3 500,000 508,125
10 1/2%, 6/12/97 A3 2,000,000 2,066,220
6%, 11/1/00 A3 1,000,000 913,460
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
Household Bank 8.45%,
12/10/02 A3 $ 1,650,000 $ 1,678,347
6,101,312
TOTAL FINANCE 59,510,001
MEDIA & LEISURE - 0.2%
PUBLISHING - 0.2%
News America Holdings, Inc.
8 5/8%, 2/1/03 Ba1 730,000 741,680
SERVICES - 0.8%
GOVERNMENT SERVICES - 0.6%
Financiera Energetica Nacional:
6 5/8%, 12/13/96 - 1,000,000 965,000
6 5/8%, 12/13/96 (b) - 1,000,000 965,000
1,930,000
LEASING & RENTAL - 0.2%
U.S. Leasing International, Inc.
6.54%, 11/15/00 A2 900,000 843,255
TOTAL SERVICES 2,773,255
TECHNOLOGY - 1.3%
COMPUTERS & OFFICE EQUIPMENT - 0.7%
Comdisco, Inc.:
9 3/4%, 1/15/97 Baa2 565,000 585,131
9.30%, 6/27/00 Baa2 1,250,000 1,323,438
9 1/4%, 7/6/00 Baa2 375,000 385,781
2,294,350
ELECTRONICS - 0.6%
Grupo Condumex SA de CV
6 1/4%, 7/27/96 (b) - 2,750,000 2,282,500
TOTAL TECHNOLOGY 4,576,850
TRANSPORTATION - 0.2%
AIR TRANSPORTATION - 0.2%
AMR Corp.:
7 3/4%, 12/1/97 Baa3 370,000 370,030
9 1/2%, 7/15/98 Baa3 250,000 257,520
627,550
NONCONVERTIBLE BONDS - CONTINUED
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
TRANSPORTATION - CONTINUED
TRUCKING & FREIGHT - 0.0%
Consolidated Freightways, Inc.
9 1/8%, 8/15/99 Baa3 $ 100,000 $ 102,326
TOTAL TRANSPORTATION 729,876
UTILITIES - 1.9%
ELECTRIC UTILITY - 1.2%
Long Island Lighting Co. 8 3/4%,
5/1/96 Baa3 2,400,000 2,435,304
United Illuminating Co.:
7 3/8%, 1/15/98 Baa3 1,500,000 1,472,115
9.76%, 1/2/06 Baa3 337,000 353,587
4,261,006
GAS - 0.7%
Southwest Gas Co. 9 3/4%,
6/15/02 Baa3 2,250,000 2,435,400
TOTAL UTILITIES 6,696,406
TOTAL NONCONVERTIBLE BONDS
(Cost $83,216,599) 79,785,052
U.S. GOVERNMENT AND GOVERNMENT
AGENCY OBLIGATIONS - 47.4%
U.S. TREASURY OBLIGATIONS - 40.8%
9 3/8%, 4/15/96 Aaa 10,100,000 10,403,000
7 1/4%, 11/15/96 Aaa 4,650,000 4,689,246
6 3/4%, 2/28/97 Aaa 9,690,000 9,688,450
8 1/2%, 5/15/97 Aaa 2,000,000 2,067,180
8 3/4%, 10/15/97 Aaa 5,700,000 5,953,821
5 5/8% 1/31/98 Aaa 1,575,000 1,521,592
9 1/4%, 8/15/98 Aaa 8,500,000 9,085,735
6 3/4% 6/30/99 Aaa 4,330,000 4,283,972
6 3/8%, 1/15/00 Aaa 7,000,000 6,803,090
8 1/2%, 11/15/00 Aaa 8,400,000 8,947,344
7 7/8%, 8/15/01 Aaa 4,000,000 4,153,120
5 3/4%, 8/15/03 Aaa 2,950,000 2,676,653
7 1/4%, 5/15/04 Aaa 400,000 400,436
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
11 5/8%, 11/15/04 Aaa $ 2,055,000 $ 2,667,000
10 3/4%, 8/15/05 Aaa 3,230,000 4,033,463
12 3/4%, 11/15/10 Aaa 5,195,000 7,222,660
9 7/8%, 11/15/15 Aaa 12,500,000 15,474,625
8 7/8%, 8/15/17 Aaa 12,105,000 13,754,306
8 1/8%, 8/15/19 Aaa 20,480,000 21,663,949
12%, 8/15/23 Aaa 7,415,000 10,200,222
TOTAL U.S. TREASURY OBLIGATIONS 145,689,864
U.S. GOVERNMENT AGENCY OBLIGATIONS - 6.6%
Federal Home Loan Bank
7.59% 12/23/96 Aaa 1,460,000 1,476,881
Federal Home Loan Mortgage
Corporation:
5.60%, 2/23/99 (d) Aaa 3,000,000 2,802,188
4.60%, 3/1/99 (d) Aaa 1,910,000 1,789,431
Financing Corporation Zero Coupon
Strips Series D, 2/3/97 Aaa 1,073,000 943,135
Government Trust Certificates (assets
of the Trust guaranteed by
U.S. Government through Defense
Security Assistance Agency):
Class 1-B, 9 1/8%,
11/15/96 Aaa 6,400,000 6,516,000
Class T-2, 9 5/8%,
5/15/02 Aaa 300,000 323,250
Class G-2, 8%, 5/15/98 Aaa 1,752,685 1,781,028
Government Trust Certificates (assets
of the Trust guaranteed by
U.S. Government through
Export-Import Bank):
Series 1992-A, 7.02%,
9/1/04 Aaa 670,000 656,809
Series 1994-F, 8.178%,
12/15/04 Aaa 3,556,298 3,645,206
Private Export Funding Corp.
5 3/4%, 4/30/98 Aaa 230,000 220,656
State of Israel (guaranteed by U.S.
Government through Agency
for International Development)
7 3/4%, 4/1/98 Aaa 340,251 344,717
6%, 2/15/99 Aaa 250,000 239,609
U.S. GOVERNMENT AND GOVERNMENT
AGENCY OBLIGATIONS - CONTINUED
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
U.S. GOVERNMENT AGENCY OBLIGATIONS - CONTINUED
Student Loan Marketing Association
8.14%, 10/15/03 Aaa $ 420,000 $ 434,700
Tennessee Valley Authority
6%, 1/15/97 Aaa 1,400,000 1,368,066
U.S. Housing & Urban Development
8.27%, 8/1/03 Aaa 1,000,000 1,042,500
TOTAL U.S. GOVERNMENT
AGENCY OBLIGATIONS 23,584,176
TOTAL U.S. GOVERNMENT AND
GOVERNMENT AGENCY OBLIGATIONS
(Cost $174,866,914) 169,274,040
U.S. GOVERNMENT AGENCY -
MORTGAGE-BACKED SECURITIES - 26.5%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 4.1%
6 1/2%, 10/1/07 Aaa 1,066,792 1,013,783
8%, 7/1/16 Aaa 42,086 41,699
8 1/2%, 9/1/19 Aaa 55,961 56,311
9%, 11/1/01 to 10/1/16 Aaa 1,502,158 1,549,391
9 1/2%, 7/1/09 to 9/1/18 Aaa 1,736,570 1,816,530
10%, 6/1/20 Aaa 392,304 418,585
10 1/2%, 1/1/01 to 2/1/19 Aaa 1,259,118 1,338,890
11%, 1/1/06 to 9/1/20 Aaa 5,979,430 6,416,920
11 1/2%, 8/1/13 to 6/1/20 Aaa 674,619 726,739
11 3/4%, 9/1/13 Aaa 135,217 145,255
12%, 2/1/13 to 7/1/15 Aaa 139,846 152,007
12 3/4%, 8/1/12 to 3/1/14 Aaa 184,407 207,688
13 1/2%, 1/1/23 Aaa 569,502 653,144
14,536,942
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 7.0%
6 1/2%, 12/1/08 to 4/1/24 Aaa 4,705,459 4,351,697
7%, 6/1/23 to 5/1/24 Aaa 1,963,830 1,853,365
7 1/2%, 1/1/08 to 11/1/07 Aaa 2,739,889 2,711,614
8 1/2%, 6/1/17 to 7/1/24 Aaa 14,025,498 14,203,577
10 3/4%, 8/1/10 to 5/1/14 Aaa 492,843 529,144
11 1/4%, 5/1/14 Aaa 117,369 127,168
11 1/2%, 8/1/14 Aaa 279,509 304,768
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
12 1/4%, 6/1/13 Aaa $ 45,626 $ 50,075
12 1/2%, 1/1/15 Aaa 102,950 113,245
13%, 12/1/14 to 1/1/15 Aaa 108,342 122,698
13 1/4%, 2/1/13 Aaa 11,413 12,961
13 1/2%, 8/1/14 to 11/1/14 Aaa 94,351 107,146
14%, 3/1/12 to 10/1/14 Aaa 424,567 486,393
24,973,851
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 15.4%
6 1/2%, 11/15/23 to 6/15/24 Aaa 6,559,082 5,929,801
7%, 12/15/22 to 9/15/23 Aaa 3,276,175 3,068,336
7 1/2%, 2 /15/17 to
11/15/24 Aaa 16,757,505 16,211,023
8%, 7/15/17 to 5/15/23 Aaa 4,382,176 4,361,156
8 1/2%, 3/15/17 to 9/15/23 Aaa 16,321,328 16,601,820
9%, 3/15/24 to 2/15/25 Aaa 2,662,850 2,757,595
10%, 6/15/13 to 10/15/18 Aaa 5,197,749 5,624,259
11 1/2%, 2/15/13 to 4/15/15 Aaa 5,771 6,378
15%, 3/15/15 Aaa 520,000 605,800
55,166,168
TOTAL U.S. GOVERNMENT AGENCY -
MORTGAGE-BACKED SECURITIES
(Cost $96,383,622) 94,676,961
COMMERCIAL MORTGAGE SECURITIES - 0.7%
Resolution Trust Corp. Commercial
Series 1994:
C2 Class A-4, 7 1/2%,
4/25/25 Aaa 682,556 679,996
C1 Class A-4, 7 1/4%,
6/25/26 Aaa 1,833,698 1,819,945
TOTAL COMMERCIAL MORTGAGE SECURITIES
(Cost $2,507,577) 2,499,941
FOREIGN GOVERNMENT OBLIGATIONS (C) - 0.8%
MOODY'S
RATINGS (A) PRINCIPAL VALUE
(UNAUDITED) AMOUNT (NOTE 1)
Malaysia euro 9 1/2%,
10/31/96 A2 $ 820,000 $ 843,780
Ontario Province 6 5/8%,
6/22/04 Aa3 1,000,000 984,370
Victorian Public Authorities Finance
Agency 8.45%, 10/1/01 Aa3 1,000,000 1,035,610
TOTAL FOREIGN GOVERNMENT OBLIGATIONS
(Cost $2,986,618) 2,863,760
REPURCHASE AGREEMENTS - 2.3%
MATURITY
AMOUNT
Investments in repurchase agreements
(U.S. Treasury obligations), in a
joint trading account, at 6.08%
dated 2/28/95 due 3/1/95 $ 8,092,366 8,091,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $368,052,330) $ 357,190,754
LEGEND
(a) Standard & Poor's Corporation credit ratings are used in the absence of
a rating by Moody's Investors Service, Inc.
(b) 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 $15,077,339 or 4.3% of net
assets.
(c) Some foreign government obligations have not been individually rated by
S&P or Moody's. The ratings listed are assigned to securities by FMR, the
fund's investment adviser, based principally on S&P and Moody's ratings of
the sovereign credit of the issuing government.
(d) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 85.6% AAA, AA, A 83.6%
Baa 9.8% BBB 9.5%
Ba 0.5% BB 1.2%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
For some foreign government obligations, FMR has assigned the ratings of
the sovereign credit of the issuing government. The percentage not rated by
either S&P or Moody's amounted to 1.2%.
INCOME TAX INFORMATION
At February 28, 1995, the aggregate cost of investment securities for
income tax purposes was $368,137,243. Net unrealized depreciation
aggregated $10,946,489, of which $2,175,045 related to appreciated
investment securities and $13,121,534 related to depreciated investment
securities.
At February 28, 1995, the fund had a capital loss carryforward of
approximately $5,486,000 which will expire on February 28, 2003.
The fund has elected to defer to its fiscal year ending February 28, 1996,
approximately $4,392,000 of losses recognized during the period November 1,
1994 to February 28, 1995.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1995
ASSETS 21. 22.
23.Investment in securities, at value (including repurchase agreements of $8,091,000) (cost 24. $ 357,190,754
$368,052,330) - See accompanying schedule
25.Cash 26. 733,883
27.Receivable for investments sold 28. 7,116,728
29.Interest receivable 30. 4,583,057
31.Receivable from investment adviser for expense reductions 32. 99,155
33. TOTAL ASSETS 34. 369,723,577
LIABILITIES 35. 36.
37.Payable for investments purchased $ 14,627,660 38.
39.Dividends payable 157,229 40.
41.Accrued management fee 92,681 42.
43.Other payables and accrued expenses 164,325 44.
45. TOTAL LIABILITIES 46. 15,041,895
47.NET ASSETS 48. $ 354,681,682
49.Net Assets consist of: 50. 51.
52.Paid in capital 53. $ 375,779,301
54.Distributions in excess of net investment income 55. (275,574)
56.Accumulated undistributed net realized gain (loss) on investments 57. (9,960,469)
58.Net unrealized appreciation (depreciation) on investments 59. (10,861,576)
60.NET ASSETS, for 34,612,067 shares outstanding 61. $ 354,681,682
62.NET ASSET VALUE, offering price and redemption price per share ($354,681,682 (divided by)
34,612,067 63. $10.25
shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED FEBRUARY 28, 1995
INVESTMENT INCOME 65. $ 6,880
64.Dividends
66.Interest 67. 26,249,756
68. TOTAL INCOME 69. 26,256,636
EXPENSES 70. 71.
72.Management fee $ 1,064,228 73.
74.Transfer agent fees 543,095 75.
76.Accounting fees and expenses 133,219 77.
78.Non-interested trustees' compensation 1,817 79.
80.Custodian fees and expenses 48,188 81.
82.Registration fees 51,167 83.
84.Audit 35,626 85.
86.Legal 4,181 87.
88.Miscellaneous 3,253 89.
90. Total expenses before reductions 1,884,774 91.
92. Expense reductions (821,045) 1,063,729
93.NET INVESTMENT INCOME 94. 25,192,907
REALIZED AND UNREALIZED GAIN (LOSS) 96. (10,706,754)
95.Net realized gain (loss) on investment securities
97.Change in net unrealized appreciation (depreciation) on investment securities 98. (7,806,576)
99.NET GAIN (LOSS) 100. (18,513,330)
101.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 102. $ 6,679,577
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 28,
1995 1994
INCREASE (DECREASE) IN NET ASSETS
103.Operations $ 25,192,907 $ 13,181,796
Net investment income
104. Net realized gain (loss) (10,706,754) 1,625,689
105. Change in net unrealized appreciation (depreciation) (7,806,576) (7,742,283)
106. 6,679,577 7,065,202
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS
107.Distributions to shareholders: (24,634,207) (12,348,634)
From net investment income
108. From net realized gain - (1,625,689)
109. In excess of net realized gain - (603,620)
110. TOTAL DISTRIBUTIONS (24,634,207) (14,577,943)
111.Share transactions 148,587,282 329,923,999
Net proceeds from sales of shares
112. Reinvestment of distributions 22,389,755 12,579,756
113. Cost of shares redeemed (86,844,254) (169,838,606)
114. 84,132,783 172,665,149
Net increase (decrease) in net assets resulting from share transactions
115. 66,178,153 165,152,408
TOTAL INCREASE (DECREASE) IN NET ASSETS
NET ASSETS 116. 117.
118. Beginning of period 288,503,529 123,351,121
119. $ 354,681,682 $ 288,503,529
End of period (including under (over) distribution of net investment income of $(275,574) and
$812,462, respectively)
OTHER INFORMATION 121. 122.
120.Shares
123. Sold 14,168,508 29,686,344
124. Issued in reinvestment of distributions 2,193,629 1,135,382
125. Redeemed (8,384,945) (15,332,829)
126. Net increase (decrease) 7,977,192 15,488,897
</TABLE>
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1995
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity U.S. Bond Index Portfolio (the fund) is a fund of Fidelity
Institutional Trust (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 following
summarizes the significant accounting policies of the fund:
SECURITY VALUATION. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days of their purchase date are valued either at
amortized cost or original cost plus accrued interest, both of which
approximate current value. Securities for which market quotations are not
readily available are valued at their fair value as determined in good
faith under consistently applied procedures under the general supervision
of the Board of Trustees.
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 all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. Interest income, which includes accretion of original
issue discount, is accrued as earned. Investment income is recorded net of
foreign taxes withheld where recovery of such taxes is uncertain.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net investment income. Distributions from realized gains, if
any, are recorded on the ex-dividend date.
Income 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 paydown
gains/losses on certain securities, market discount and losses deferred due
to wash sales and excise tax regulations.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect net investment income per share. Distributions in excess of net
investment income 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.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of Fidelity Management & Research Company (FMR), may transfer
uninvested cash balances into one or more joint trading accounts. These
balances are invested in one or more repurchase agreements that mature in
60 days or less from the date of purchase, and are collateralized by U.S.
Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. FMR, the fund's
investment adviser, is responsible for determining that the value of these
underlying securities remains at least equal to the resale price.
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $322,215,700 and $239,479,036, respectively, of which U.S.
government and government agency obligations aggregated $275,222,475 and
$195,725,100, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a fee that
is computed daily at an annual rate of .32% of the fund's average net
assets.
TRANSFER AGENT FEES. Fidelity Investments Institutional Operations Company
(FIIOC), an affiliate of FMR, is the fund's transfer, dividend disbursing
and shareholder servicing agent. During the period March 1, 1994 to
December 31, 1994, FIIOC received fees based on the type, size, number of
accounts and the number of transactions made by shareholders. Effective
January 1, 1995, the Board of Trustees approved a revised transfer agent
contract pursuant to which FIIOC receives account fees and asset-based fees
that vary according to account size and type of account. FIIOC pays for
typesetting, printing and mailing of all shareholder reports, except proxy
statements.
ACCOUNTING FEES. Fidelity Service Co., an affiliate of FMR, maintains the
fund's accounting records. The fee is based on the level of average net
assets for the month plus out-of-pocket expenses.
5. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the fund's operating expenses
(excluding interest, taxes, brokerage commissions and extraordinary
expenses) above an annual rate of .32% of average net assets. For the
period, the reimbursement reduced the expenses by $821,045.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Institutional Trust and
the Shareholders of Fidelity U.S. Bond Index Portfolio:
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of investments (except for Moody's and Standard &
Poor's ratings), and the related statements of operation and of changes in
net assets and the financial highlights (included on page P-4 of the
Prospectus), present fairly, in all material respects, the financial
position of Fidelity U.S. Bond Index Portfolio (a fund of Fidelity
Institutional Trust) at February 28, 1995, the results of its operations
for the year then ended, the changes in its net assets and the financial
highlights for the periods indicated in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of
the Fidelity U.S. Bond Index Portfolio's management; our responsibility is
to express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with
generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which
included confirmation of securities owned at February 28, 1995 by
correspondence with the custodian and brokers, and the application of
alternative auditing procedures where confirmations from brokers, were not
received, provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Boston, Massachusetts
April 10, 1995
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
Christine Thompson, VICE PRESIDENT
Arthur S. Loring, SECRETARY
Stephen P. Jonas, TREASURER
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox
Phyllis Burke Davis
Richard J. Flynn
Edward C. Johnson 3d
E. Bradley Jones
Donald J. Kirk
Peter S. Lynch
Edward H. Malone
Marvin L. Mann
Gerald C. McDonough
Thomas R. Williams
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER SERVICING AGENT
Fidelity Investments Institutional Operations Company
Boston, MA
CUSTODIAN
The Bank of New York
New York, NY
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how the fund
invests and the services available to shareholders.
FIDELITY
U.S. EQUITY INDEX
PORTFOLIO
To learn more about the fund and its investments, you can obtain a
copy of the fund's most recent financial report and portfolio listing or a
copy of the Statement of Additional Information (SAI) dated April 19,
1995 . The SAI has been filed with the Securities and Exchange
Commission (SEC) and is incorporated herein by reference (legally forms a
part of the prospectus). For a free copy of either document, or for
information or assistance in opening a new account call the appropriate
number listed below or call your Investment Professional.
INDIVIDUAL ACCOUNTS (PARTICIPANT)
If you are investing through a retirement plan sponsor or other
institution, refer to your plan materials or contact that institution
directly.
RETIREMENT PLAN LEVEL ACCOUNTS
(TRUSTEES, PLAN SPONSORS)
Corporate Clients 800-962-1375
"Not for Profit" Clients 800-343-0860
FINANCIAL AND OTHER INSTITUTIONS
Nationwide 800-843-3001
MUTUAL FUND SHARES ARE NOT DEPOSITS OR
OBLIGATIONS OF, OR GUARANTEED BY, ANY
DEPOSITORY INSTITUTION. SHARES ARE NOT
INSURED BY THE FDIC, THE FEDERAL RESERVE
BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT
TO INVESTMENT RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL.
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.
UEI-pro-495
A fund of Fidelity Institutional Trust
The fund seeks a total return which corresponds to the Standard & Poor's
Composite Index of 500 Stocks.
PROSPECTUS
DATED APRIL 19, 1995(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON,
MA 02109
AND
ANNUAL REPORT
FOR THE PERIOD ENDING
FEBRUARY 28, 1995
CONTENTS
PROSPECTUS
<TABLE>
<CAPTION>
<S> <C> <C>
KEY FACTS WHO MAY WANT TO INVEST
EXPENSES The fund's yearly operating expenses.
FINANCIAL HIGHLIGHTS A summary of the fund's
financial data.
PERFORMANCE How the fund has done over time.
THE FUND IN DETAIL CHARTER How the fund is organized.
INVESTMENT PRINCIPLES AND RISKS The 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
APPENDIX
</TABLE>
ANNUAL REPORT
<TABLE>
<CAPTION>
<S> <C> <C>
PERFORMANCE A-1 How the fund has done over time.
FUND TALK A-3 The manager's review of fund performance, strategy
and outlook.
INVESTMENTS A-5 A complete list of the fund's investments with their
market values.
FINANCIAL STATEMENTS A-14 Statement of assets and liabilities, operations, and
changes in net assets .
NOTES A-17 Notes to the financial statements.
REPORT OF INDEPENDENT ACCOUNTANTS A-20 The auditor's opinion.
</TABLE>
KEY FACTS
WHO MAY WANT TO INVEST
The fund may be appropriate for investors who are willing to ride out stock
market fluctuations in pursuit of potentially high long-term returns. The
fund is designed for those who want to keep expenses low while pursuing
growth of capital and income through a portfolio of securities that broadly
represents the U.S. stock market, as measured by the Standard & Poor's
Composite Index of 500 Stocks (S&P 500(registered trademark)).
Because the fund seeks to track, rather than beat, the performance of the
S&P 500, the fund is not managed in the same manner as other mutual
funds. Fidelity Management & Research Company (FMR) generally does
not judge the merits of any particular stock as an investment. Therefore,
you should not expect to achieve the potentially greater results that could
be obtained by a fund that aggressively seeks growth.
The value of the fund's investments varies from day to day, generally
reflecting changes in market conditions and other company, political, and
economic news. Over time, s tocks have shown greater growth potential
than other types of securities. In the short - term, however, stock
prices can fluctuate dramatically in response to these factors.
The fund itself is not a balanced investment plan. You should consider
your investment objective and tolerance for risk when making an investment
decision. When you sell your shares, they may be worth more or less than
what you paid for them.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you pay when you buy or sell
shares of a fund.
Maximum sales charge on purchases and None
reinvested distributions
Maximum deferred sales charge on redemptions None
Redemption fee None
Exchange fee None
ANNUAL OPERATING EXPENSES are paid out of the fund's assets. The fund pays
a management fee to FMR . The fund also incurs other expenses for
services such as maintaining shareholder records, and furnishing
shareholder account statements and financial reports.
The fund's expenses are factored into its share price or dividends and are
not charged directly to shareholder accounts (see "Breakdown of Expenses"
on page ).
The following are projections based on historical expenses of the fund, and
are calculated as a percentage of average net assets.
Management fee (after reimbursement) 0.0 0
%
12b-1 fee (Distribution Fee) None
Other expenses 0.28
%
Total operating expenses (after reimbursement) 0.28
%
EXPENSE TABLE EXAMPLE: You would pay the following expenses on a $1,000
investment in the fund, assuming a 5% annual return and full redemption, at
the end of each time period:
1 3 5 10
Year Years Years Years
$ 3 $ 9 $ 16 $ 36
THESE EXAMPLES ILLUSTRATE THE EFFECT OF EXPENSES, BUT ARE NOT MEANT TO
SUGGEST ACTUAL OR EXPECTED COSTS OR RETURNS, ALL OF WHICH MAY VARY.
Subject to revision upon 90 days' notice to shareholders, FMR has
voluntarily agreed to reimburse the fund to the extent that total operating
expenses are in excess of 0 .28% of its average net assets. If this
agreement were not in effect, the management fee, other expenses, and total
operating expenses would have been 0.28%, 0.31%, and 0.59 % ,
respectively, as percentages of average net assets. Interest, taxes,
brokerage commissions, or extraordinary expenses are not included in this
expense limitation.
FINANCIAL HIGHLIGHTS
The financial highlights table that follows and the fund's financial
statements are included in the fund's Annual Report and have been audited
by Price Waterhouse LLP , independent accountants. Their report on
the financial statements and financial highlights is included in the Annual
Report. The financial statements, the financial highlights, and the report
are attached.
SELECTED PER-SHARE DATA
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
132.Years ended
February 28 1988B 1989C 1990C 1991C 1992C 1993D 1994 1995
133.Net asset value,
beginning of period $ 10.00 $ 10.81 $ 13.23 $ 11.61 $ 14.97 $ 15.77 $ 16.73 $ 17.36
134.Income from
Investment Operations
135. Net investment
income .23 .38 .44 .42 .42 .15 .44 .43
136. Net realized
and unrealized gain .74 2.41 (1.44) 3.38 .97 .94 .88 .77
(loss) on investments
137. Total from
investment operations .97 2.79 (1.00) 3.80 1.39 1.09 1.32 1.20
138.Less Distributions
139. From net investment
income (.16) (.35) (.48) (.44) (.43) (.13) (.44) (.43)
140. From net realized
gain -- (.02) (.14) -- (.16) -- (.25) (.07)
141. In excess of net
realized gain -- -- -- -- -- -- -- (.04)
142. Total
distributions (.16) (.37) (.62) (.44) (.59) (.13) (.69) (.54)
143.Net asset value,
end of period $ 10.81 $ 13.23 $ 11.61 $ 14.97 $ 15.77 $ 16.73 $ 17.36 $ 18.02
144.Total return E,F 9.77% 26.30% (7.98) 33.13% 9.59% 6.93% 8.06% 7.17%
%
145.RATIOS AND SUPPLEMENTAL DATA
146.Net assets, end
of period (000 $ 34,576 $ 303,859 $ 435,641 $ 960,442 $ 1,454,6 $ 1,472,1 $ 1,892,2 $ 2,234,8
omitted) 84 02 54 92
147.Ratio of expenses
to average net .28%A .28% .28% .28% .28% .28% .28% .28%
assets A
148.Ratio of expenses
to average net 1.83%A, .97% .66% .67% .64% .66% .61% .59%
assets before expense
reductions G A
149.Ratio of net
investment income to 4.56%A 3.79% 3.55% 3.14% 2.78% 2.95% 2.59% 2.65%
average net assets A
150.Portfolio
turnover rate 3%A 10% 2% 4% 6% 28% 4% 11%
A
</TABLE>
A ANNUALIZED
B FEBRUARY 17, 1988 (COMMENCEMENT OF OPERATIONS) TO OCTOBER 31, 1988.
C FOR THE YEAR ENDED OCTOBER 31.
D FOR THE FOUR MONTHS ENDED FEBRUARY 28, 1993.
E TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
F THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7 OF NOTES TO FINANCIAL
STATEMENTS ON PAGE A-19).
G EXPENSES WOULD HAVE BEEN LIMITED IN ACCORDANCE WITH THE STATE EXPENSE
LIMITATION IF THE VOLUNTARY LIMITATION HAD NOT BEEN IN EFFECT.
PERFORMANCE
Mutual fund performance is commonly measured as TOTAL RETURN. The total
returns that follow are based on historical fund results and do not reflect
the effect of taxes.
The fund's fiscal year runs from March 1 to February 28. The tables below
show the fund's performance history compared to the S&P 500 and a
measure of inflation.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Fiscal periods ended Past 1 Past 5 Life of
February 28, 1995 year [C] years[ C ] fund[A][ C ]
</TABLE>
U.S. Equity Index 7.17% 11.02% 12.60%
S&P 500 7.36% 11.35% 12.92%
Consumer Price 2.86% 3.35% 3.83%[B]
Index
CUMULATIVE TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Fiscal periods ended Past 1 Past 5 Life of
February 28, 1995 year[ C ] years[ C ] fund[A][ C ]
</TABLE>
U.S. Equity Index 7.17% 68.66% 130.51%
S&P 500 7.36% 71.20% 135.25%
Consumer Price 2.86% 17.89% 30.09%[B]
Index
[A] FROM FEBRUARY 17, 1988
[B] TOTAL RETURNS ARE FROM MONTH END CLOSEST TO COMMENCEMENT OF OPERATIONS.
[C] IF FMR HAD NOT REIMBURSED CERTAIN FUND EXPENSES DURING THESE PERIODS,
TOTAL RETURNS WOULD HAVE BEEN LOWER.
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment in the fund over a
given period, assuming reinvestment of any dividends and capital gains. A
CUMULATIVE TOTAL RETURN reflects actual performance over a stated period of
time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that,
if achieved annually, would have produced the same cumulative total return
if performance had been constant over the entire period. Average annual
total returns smooth out variations in performance; they are not the same
as actual year-by-year results.
YIELD refers to the income generated by an investment in the fund over a
given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all stock and bond
funds. Because this differs from other accounting methods, the quoted yield
may not equal the income actually paid to shareholders.
THE S&P 500 is the Standard & Poor's Composite Index of 500 Stocks,
a widely recognized, unmanaged index of common stock prices. The S&P 500
figures assume reinvestment of all dividends paid by stocks included in the
index. They do not, however, include any allowance for the brokerage
commissions or other fees you would pay if you actually invested in those
stocks.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. G overnment.
The fund may quote its adjusted net asset value, including all
distributions paid. This value may be averaged over specified periods and
may be used to calculate the fund's moving average.
The fund's recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders.
For current performance call Client Services at the appropriate
number listed on page .
TOTAL RETURNS ARE BASED ON PAST RESULTS AND ARE NOT AN INDICATION OF FUTURE
PERFORMANCE.
THE FUND IN DETAIL
CHARTER
U.S. EQUITY INDEX IS A MUTUAL FUND: an investment that pools shareholders'
money and invests it toward a specified goal. The fund is a diversified
fund of Fidelity Institutional Trust, an open-end management investment
company organized as a Massachusetts business trust on July 21,
1987.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the fund's activities,
review contractual arrangements with companies that provide services to the
fund, and review the fund's performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These meetings
may be called to elect or remove trustees, change fundamental policies,
approve a management contract, or for other purposes. Shareholders not
attending these meetings are encouraged to vote by proxy. The transfer
agent will mail proxy materials in advance, including a voting card and
information about the proposals to be voted on. You are entitled to one
vote for each share you own.
FMR AND ITS AFFILIATES
Fidelity Investments is one of the largest investment management
organizations in the United States and has its principal business address
at 82 Devonshire Street, Boston, Massachusetts 02109. It includes a number
of different subsidiaries and divisions which provide a variety of
financial services and products. The fund employs various Fidelity
companies to perform activities required for its operation.
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs.
As of February 28 , 1995, FMR advised funds having approximately
20 million shareholder accounts with a total value of more than
$ 270 billion.
Jennifer Farrelly is manager of U.S. Equity Index, which she has managed
since January 1994. She also manages VIP II: Index 500 and Market Index.
Ms. Farrelly joined Fidelity in 1988.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation ( FDC ) distributes and
markets Fidelity's funds and services. Fidelity Investment s
Institutional Operations Company (FIIOC) performs transfer agent servicing
functions for the fund.
FMR Corp. is the ultimate parent company of FMR. Through ownership of
voting common stock, members of the Edward C. Johnson 3d family form a
controlling group with respect to FMR Corp. Changes may occur in the
Johnson family group, through death or disability, which would result in
changes in each individual family member' s holding of stock. Such
changes could result in one or more family members becoming holders of over
25% of the stock. FMR Corp. has received an opinion of counsel that changes
in the composition of the Johnson family group under these circumstances
would not result in the termination of the fund's management or
distribution contracts and, accordingly, would not require a shareholder
vote to continue operation under those contracts.
To carry out the fund's transactions, FMR may use its broker-dealer
affiliates and other firms that sell fund shares, provided that the fund
receives brokerage services and commission rates comparable to those of
other broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
The fund seeks to provide investment results that correspond to the total
return (i.e., the combination of capital changes and income) performance of
common stocks publicly traded in the United States. In seeking this
objective, the fund attempts to duplicate the composition and total return
of the S&P 500 while keeping transaction costs and other expenses
low .
The fund seeks to match the total return of the S&P 500 while keeping
expenses low. FMR normally invests 90% of the fund's assets in equity
securities of companies that compose the S&P 500. If the fund's assets drop
below $20 million, the percentage of the fund's assets invested in such
securities may drop to as low as 65%. Although the fund focuses on common
stocks, it may also invest in other equity securities and in other types of
instruments. The fund purchases short-term debt securities for cash
management purposes and uses various techniques, such as futures contracts,
to adjust its exposure to the S&P 500.
The S&P 500 is made up of 500 common stocks, most of which trade on the New
York Stock Exchange (NYSE) . Standard & Poor's Corporation
(S&P) is neither an affiliate nor a sponsor of the fund, and inclusion
of a stock in the index does not imply that it is a good investment. The
S&P 500 is a widely recognized unmanaged index of common stock prices. It
is generally acknowledged that the S&P 500 broadly represents the
performance of publicly traded common stocks in the United States. Total
returns for the S&P 500 assume reinvestment of dividends but do not include
the effect of taxes, brokerage commissions or other fees. At some time in
the future FMR may, subject to shareholders' approval and 30 days' notice,
select another index if such a standard of comparison is deemed to be more
representative of the performance of U.S. common stocks.
In seeking a 98% or better long-term correlation of the fund's total return
to that of the S&P 500, the fund utilizes a "passive" or "indexing"
approach and tries to allocate its assets similarly to those of the index.
The fund's composition may not always be identical to that of the S&P 500.
FMR may choose, if extraordinary circumstances warrant, to exclude a stock
held in the S&P 500 and include a similar stock in its place if doing so
will help the fund achieve its objective. FMR monitors the correlation
between the performance of the fund and the S&P 500 on a regular basis. In
the unlikely event that the fund cannot achieve a long-term correlation of
98% or better, the trustees will consider alternative arrangements.
FMR believes that with total assets of $20 million or more, the fund will
replicate the investment results of the S&P 500 with a relatively small
margin of tracking error.
Also, as a mutual fund, the fund seeks to spread investment risk by
diversifying its holdings among many companies and industries. Stock
values fluctuate in response to the activities of individual companies and
general market and economic conditions. FMR may use various
investment techniques to hedge the fund's risks, but there is no guarantee
that these strategies will work as FMR intend s . The value
of the fund's investments varies in response to many factors. When you
sell your shares, they may be worth more or less than what you paid for
them.
FMR normally invests the fund's assets according to its investment
strategy. The fund also reserves the right to invest without
limitation in preferred stocks and investment-grade debt instruments for
temporary, defensive purposes.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, and strategies FMR may employ in
pursuit of the fund's investment objective. A summary of risks and
restrictions associated with these instrument types and investment
practices is included as well. A complete listing of the fund's policies
and limitations and more detailed information about the fund's investments
is contained in the fund's SAI. Policies and limitations are considered at
the time of purchase; the sale of instruments is not required in the event
of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques to
the full extent permitted unless it believes that doing so will help the
fund achieve its goal. Current holdings and recent investment strategies
are described in the fund's financial reports, which are sent to
shareholders twice a year. For a free SAI , call the appropriate
number listed on page .
EQUITY SECURITIES may include common stocks, preferred stocks, convertible
securities, and warrants. Common stocks, the most familiar type, represent
an equity (ownership) interest in a corporation. Although equity securities
have a history of long-term growth in value, their prices fluctuate based
on changes in a company's financial condition and on overall market and
economic conditions. Smaller companies are especially sensitive to these
factors.
RESTRICTION: With respect to 75% of its total assets, the fund may
not purchase more than 10% of the outstanding voting securities of
any issuer.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and
securities issued by U.S. entities with substantial foreign operations may
involve additional risks and considerations. These include risks relating
to political or economic conditions in foreign countries, fluctuations in
foreign currencies, withholding or other taxes, operational risks,
increased regulatory burdens, and the potentially less stringent investor
protection and disclosure standards of foreign markets. Additionally,
governmental issuers of foreign securities may be unwilling to repay
principal and interest when due, and may require that the conditions for
payment be renegotiated. All of these factors can make foreign investments,
especially those in developing countries, more volatile.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a security
at one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices ,
currency exchange rates or other factors that affect security values.
These techniques may involve derivative transactions such as buying and
selling options and futures contracts, entering into currency exchange
contracts or swap agreements, and purchasing indexed securities.
FMR can use these practices to adjust the risk and return characteristics
of the fund's portfolio of investments. If FMR judges market conditions
incorrectly or employs a strategy that does not correlate well with the
fund's investments, these techniques could result in a loss, regardless of
whether the intent was to reduce risk or increase return. These techniques
may increase the volatility of the fund and may involve a small investment
of cash relative to the magnitude of the risk assumed. In addition, these
techniques could result in a loss if the counterparty to the transaction
does not perform as promised.
ILLIQUID SECURITIES. Some investments may be determined by FMR,
under the supervision of the Board of Trustees, to be illiquid, which means
that they may be difficult to sell promptly at an acceptable price.
Difficulty in selling securities may result in a loss or may be costly
to the fund.
RESTRICTION : The fund may not purchase a security if, as a result,
more than 10% of its net assets would be invested in illiquid securities.
OTHER INSTRUMENTS may include real estate-related investments.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry .
Economic, business, or political changes can affect all securities of a
similar type.
RESTRICTION S: With respect to 75% of its total assets, the
fund may not purchase a security if, as a result more than 5%
would be invested in the securities of any issuer.
These limitations do not apply to U.S. Government securities.
BORROWING. The fund may borrow from banks or from other funds advised by
FMR, or through reverse repurchase agreements. If the fund borrows money,
its share price may be subject to greater fluctuation until the borrowing
is paid off. If the fund makes additional investments while borrowings are
outstanding, this may be considered a form of leverage.
RESTRICTION: The fund may borrow only for temporary or emergency purposes,
but not in an amount exceeding 33% of its total assets.
LENDING. Lending securities to broker-dealers and institutions, including
Fidelity Brokerage Services, Inc. , an affiliate of FMR, is a means
of earning income. This practice could result in a loss or a delay in
recovering the fund's securities. The fund may also lend money to other
funds advised by FMR.
RESTRICTION: Loans, in the aggregate, may not exceed 33% of the fund's
total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
The fund seeks investment results that correspond to the total return
(i.e., the combination of capital changes and income) of common stocks
publicly traded in the United States. In seeking this objective, the fund
attempts to duplicate the composition and total return of the S&P 500 while
keeping transaction costs and other expenses low.
With respect to 75% of its total assets, the fund may not
purchase a security if, as a result, more than 5% would be invested
in the securities of any issuer and may not purchase more
than 10% of the outstanding voting securities of any issuer.
The fund may borrow only for temporary or emergency purposes, but not in an
amount exceeding 33% of its total assets.
Loans, in the aggregate, may not exceed 33% of the fund's total assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily operations.
Expenses paid out of the fund's assets are reflected in its share price or
dividends; they are neither billed directly to shareholders nor deducted
from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. The fund also pays OTHER EXPENSES, which are explained
below.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fund pays
the fee at the annual rate of 0 .28% of its average net assets.
OTHER EXPENSES
While the management fee is a significant component of the fund's
annual operating costs, the fund has other expenses as well.
FIIOC performs transfer agency, dividend disbursing and shareholder
servicing functions for the fund. Fidelity Service Company
( FSC ) calculates the net asset value per share
( NAV ) and dividends for the fund, maintains the fund's general
accounting records , and administers the fund's securities lending
program. In fiscal 1995, the fund paid FIIOC and FSC fees equal to 0.25%
(before reimbursement, if any) and 0.04% (before reimbursement, if any),
respectively, of the fund's average net assets.
The fund has adopted a DISTRIBUTION AND SERVICE PLAN . This plan
recognizes that FMR may use its resources, including management fees, to
pay expenses associated with the sale of fund shares. This may include
payments to third parties, such as banks or broker-dealers, that provide
shareholder support services or engage in the sale of the fund's
shares. The Board of Trustees has not authorized such payments. The fund
does not pay FMR any separate fees for this service.
The fund also pays other expenses, such as legal, audit, and custodian
fees; in some instances, proxy solicitation costs; and the
compensation of trustees who are not affiliated with Fidelity.
The fund's portfolio turnover rate for fiscal 1995 was 11 %. This
rate varies from year to year.
YOUR ACCOUNT
TYPES OF ACCOUNTS
If you invest through an Investment Professional, read that Investment
Professional's program materials in conjunction with this prospectus for
additional service features or fees that may apply. Certain features of
the fund, such as minimum initial or subsequent investment amounts, may be
modified in these programs, and administrative charges may be imposed for
the services rendered.
The different ways to set up (register) your account with Fidelity are
listed below.
The account guidelines that follow may not apply to certain retirement
accounts. If your employer offers the fund through a retirement program,
contact your employer . Otherwise, call your Fidelity toll-free
retirement number .
WAYS TO SET UP YOUR ACCOUNT
TRUST
FOR MONEY BEING INVESTED BY A TRUST.
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS.
For more specific information, call the appropriate number listed on page .
TAX SAVING RETIREMENT PLANS. Fidelity can set up your new account in the
fund under one of several tax-sheltered plans. These plans let you save for
retirement and shelter your investment income from current taxes. Minimums
may differ from those listed on page , and the corresponding information
may not apply. Retirement plan participants should refer to their
retirement plan's guidelines for further information.
(solid bullet) DEFINED CONTRIBUTION PLANS, such as 401(k) Plans,
employer-sponsored IRA programs, Thrift, Keogh or Corporate Profit-Sharing
or Money-Purchase Plans: open to self-employed people and their partners or
to corporations, to benefit themselves and their employees.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are open to employees of most
non-profit organizations.
(solid bullet) DEFINED BENEFIT PLANS are open to corporations of all sizes
to benefit their employees.
(solid bullet) 457 PLANS are open to employees of most government agencies.
(solid bullet) ROLLOVER IRAS retain special tax advantages for certain
distributions from employer-sponsored retirement plans.
HOW TO BUY SHARES
THE FUND'S SHARE PRICE, called NAV, is calculated every business day. The
fund's shares are sold without a sales charge.
Shares are purchased at the next NAV calculated after your order is
received and accepted by the transfer agent . NAV is normally
calculated at 4:00 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application and
mail it along with your check. You may also open your account by wire as
described on page . If there is no account application accompanying
this prospectus, call the appropriate number listed on page .
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail an account application with a check,
(small solid bullet) Open your account by exchanging from another Fidelity
fund ,
(small solid bullet) Wire money into your account, or
(small solid bullet) Contact your Investment Professional .
If you buy shares by check or Fidelity Money Line(registered trademark),
and then sell those shares by any method other than by exchange to another
Fidelity fund, the payment may be delayed for up to seven business days to
ensure that your previous investment has cleared.
SECURITIES EXCHANGE. Shares of the fund may be purchased in exchange for
securities you hold which meet the fund's investment objective, policies
and limitations. FDC reserves the right to refuse a securities exchange for
any reason. You may realize a gain or loss for federal income tax purposes
upon a securities exchange.
For further information, call Client Services at the appropriate telephone
number on page . DO NOT SEND SECURITIES TO THE FUND OR TO
FDC.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $100,000
TO ADD TO AN ACCOUNT $2,500
MINIMUM BALANCE $100,000
FOR 6. INFORMATION OR ASSISTANCE IN OPENING A NEW ACCOUNT:
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Initial Investment Corporate Retirement Plans 800-962-1375
(Client Services) 800-343-0860
"Not for Profit" Retirement Plans 800-843-3001
Financial and Other Institutions
Additional Investment Corporate Retirement Plans 800-962-1375
(Client Services) 800-343-0860
"Not for Profit" Retirement Plans 800-343-6310
Financial and Other Institutions
</TABLE>
<TABLE>
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<S> <C> <C>
TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
PHONE (small solid bullet) Exchange from
another Fidelity fund (small solid bullet) Exchange from another Fidelity
account with the same
registration, fund account with the same
including name, address, and registration, including name,
taxpayer ID number. address, and taxpayer ID number.
(phone_graphic) (small solid bullet) Use Fidelity Money Line (registered trademark) to
transfer from your bank account.
Call before your first use to verify
that this service is in place on your
account. Minimum Money Line:
$250. Maximum Money Line:
$50,000
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Mail
(mail_
graphic) (small solid bullet) Complete and sign the account (small solid bullet) Make your check payable to
application. Make your check "Fidelity U.S. Equity Index
payable to "Fidelity U.S. Equity Index Portfolio." Indicate your fund
Portfolio." Mail to the address account number on your check and
indicated on the application. mail to the address printed on your
account statement.
(small solid bullet) C all the appropriate number listed
above for instructions.
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Wire (wire_graphic) (small solid bullet) Call the appropriate
number listed (small solid bullet) You must sign up for the wire
above to set up your account and to feature before using it. Call the
arrange a wire transaction. appropriate number listed above for
(small solid bullet) Call Client
Services before 4:00 p.m. instructions.
Eastern time. (small solid bullet) Call Client Services before 4:00
p.m. Eastern time.
</TABLE>
HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares. Your shares will be sold at
the next NAV calculated after your order is received and accepted by the
transfer agent. NAV is normally calculated at 4:00 p.m. Eastern time.
If you are selling shares of the fund as offered through an
employer-sponsored retirement plan, please contact your employer or call
your Fidelity toll-free retirement plan number.
TO SELL SHARES IN AN ACCOUNT, you may use any of the methods described on
these two pages.
TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE (registered
trademark), you will need to sign up for these services in advance.
TO SELL SHARES IN A RETIREMENT ACCOUNT, your request must be made in
writing, except for exchanges to other Fidelity funds, which can be
requested by phone or in writing.
IF YOU ARE SELLING SOME, BUT NOT ALL OF YOUR SHARES, leave at least
$100,000 worth of shares in the account to keep it open.
CERTAIN REQUESTS MUST INCLUDE A SIGNATURE GUARANTEE. It is designed to
protect you and Fidelity from fraud. Your request must be made in writing
and include a signature guarantee if any of the following situations apply:
(small solid bullet) You wish to redeem more than $100,000 worth of shares,
(small solid bullet) Your account registration has changed within the last
30 days,
(small solid bullet) The check is being mailed to a different address than
the one on your account (record address),
(small solid bullet) The check is being made payable to someone other than
the account owner,
(small solid bullet) The redemption proceeds are being transferred to a
Fidelity account with a different registration, or
(small solid bullet) You wish to have redemption proceeds wired to a
non-predesignated bank account.
You should be able to obtain a signature guarantee from a bank,
broker - dealer, credit union (if authorized under state law),
securities exchange or association, clearing agency, or savings
association. A notary public cannot provide a signature guarantee.
SELLING SHARES IN WRITING
Write a "letter of instruction" with:
(small solid bullet) Your name,
(small solid bullet) The fund's name,
(small solid bullet) Your fund account number,
(small solid bullet) The dollar amount or number of shares to be redeemed,
and
(small solid bullet) Any other applicable requirements listed in the
following table.
Mail your letter to the following address:
Fidelity U.S. Equity Index Portfolio
Fidelity Investments Institutional Operations Company
P.O. Box 1182
Boston, MA 02103-1182
Unless otherwise instructed, the transfer agent will send a check to the
record address.
ACCOUNT TYPE SPECIAL REQUIREMENTS
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PHONE All account types , except retirement (small solid bullet) Maximum check request: $100,000.
(small solid bullet) For Fidelity Money Line (registered
trademark) transfers
to your bank account: Minimum:
$2,500. Maximum: $50,000.
(phone_graphic) (small solid bullet) You may exchange to other Fidelity
funds if both accounts are
registered with the same name(s),
address, and taxpayer ID number.
(phone_
graphic) Retirement account (small solid bullet) If you have invested through an
employer-sponsored retirement
plan, contact your employer or call
the appropriate number listed on
page .
Mail or in Person
(mail_graphic)
(hand_graphic) Retirement account (small solid bullet) The account owner should complete
a retirement distribution form. Call
the appropriate number listed on
Trust page or your Fidelity toll-free
retirement number.
(small solid bullet) The trustee must sign the letter
indicating capacity as trustee. If the
trustee's name is not in the account
registration, provide a copy of the
trust document certified within the
last 60 days with a signature
guaranteed letter.
Business or Organization (small solid bullet) At least one person authorized by
corporate resolution to act on the
account must sign the letter. Must
be accompanied by a signature
guarantee.
Wire (wire_
graphic) All account types (small solid bullet) You must sign up for the wire
feature before using it. Call the
appropriate number listed on page
to verify that it is in place.
Minimum wire: $100,000.
(small solid bullet) Your wire redemption request must
be received by the transfer agent
before 4:00 p.m. Eastern time for
money to be wired on the next
business day.
</TABLE>
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired:
1-800-544-0118
INVESTOR SERVICES
Fidelity provides a variety of services to help you manage your account.
INFORMATION SERVICES
STATEMENTS AND REPORTS that Fidelity sends to you include the following:
(small solid bullet) Confirmation statements (after every transaction,
except a reinvestment, that affects your account balance or your account
registration)
(small solid bullet) Account statements (quarterly for retirement
plans , monthly for all others )
(small solid bullet) Financial reports (every six months)
To reduce expenses, only one copy of most financial reports will be mailed,
even if you have more than one account in the fund. Call the appropriate
number listed on page if you need additional copies of financial
reports.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE . You may sell your fund shares and buy shares of
other Fidelity funds by telephone or in writing.
Note that exchanges out of the fund are limited to four per calendar year,
and that they may have tax consequences for you. For details on policies
and restrictions governing exchanges, including circumstances under which a
shareholder's exchange privilege may be suspended or revoked, see
"Exchange Restrictions" on page .
FIDELITY MONEY LINE (registered trademark) enables you to transfer
money by phone between your bank account and your fund account. Most
transfers are complete within three business days of your call.
SHAREHOLDER AND ACCOUNT POLICIES
DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net income and capital gains
to shareholders each year. Normally, dividends are distributed in March,
June, September, and December. Capital gains are normally distributed in
April and December.
DISTRIBUTION OPTIONS
When you open an account, specify on your account application how you want
to receive your distributions. The fund offers three options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions will
be automatically reinvested in additional shares of the fund. If you do not
indicate a choice on your application, you will be assigned this option.
2. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested in additional shares of the fund, but you will be
sent a check for each dividend distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions.
For retirement accounts all distributions are automatically reinvested.
When you are over 59 1/2 years old, you can receive distributions in cash.
When the fund deducts a distribution from its NAV, the reinvestment price
is the NAV at the close of business that day. Distribution checks will be
mailed within seven days.
TAXES
As with any investment, you should consider how your investment in the fund
will be taxed. If your account is not a tax-deferred retirement account,
you should be aware of these tax implications.
TAXES ON DISTRIBUTIONS. Distributions are subject to federal income tax,
and may also be subject to state or local taxes. If you live outside the
United States, your distributions could also be taxed by the country in
which you reside. Your distributions are taxable when they are paid,
whether you take them in cash or reinvest them. However, distributions
declared in December and paid in January are taxable as if they were paid
on December 31.
For federal tax purposes, the fund's income and short-term capital gain
distributions are taxed as dividends; long-term capital gain distributions
are taxed as long-term capital gains.
Every January, Fidelity will send you and the IRS a statement showing the
taxable distributions paid to you in the previous year.
TAXES ON TRANSACTIONS. Your redemptions-including exchanges-are subject to
capital gains tax. A capital gain or loss is the difference between the
cost of your shares and the price you receive when you sell them.
Whenever you sell shares of the fund, Fidelity will send you a confirmation
statement showing how many shares you sold and at what price.
You will also receive a consolidated transaction statement at least
quarterly. However, it is up to you or your tax preparer to determine
whether this sale resulted in a capital gain and, if so, the amount of tax
to be paid. BE SURE TO KEEP YOUR REGULAR ACCOUNT STATEMENTS; the
information they contain will be essential in calculating the amount of
your capital gains.
"BUYING A DIVIDEND." If you buy shares just before the fund deducts a
distribution from its NAV, you will pay the full price for the shares and
then receive a portion of the price back in the form of a taxable
distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the
fund and its investments and these taxes generally will reduce the fund's
distributions.
There are tax requirements that all funds must follow in order to avoid
federal taxation. In its effort to adhere to these requirements, the fund
may have to limit its investment activity in some types of instruments.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS each day the NYSE is open. FSC
normally calculates the fund's NAV as of the close of business of the NYSE,
normally 4:00 p.m. Eastern time.
THE FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and dividing the result by the number of
shares outstanding.
The fund's assets are valued primarily on the basis of market
quotations. Foreign securities are valued on the basis of quotations
from the primary market in which they are traded. If quotations are not
readily available, assets are valued by a method that the Board of Trustees
believes accurately reflects fair value.
THE FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION PRICE
(price to sell one share) are its NAV.
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that
your social security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require a fund to
withhold 31% of your taxable distributions and redemptions.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does not
follow reasonable procedures designed to verify the identity of the caller.
Fidelity will request personalized security codes or other information, and
may also record calls. You should verify the accuracy of the confirmation
statements immediately after receipt. If you do not want the ability to
redeem and exchange by telephone, call Fidelity for instructions.
Additional documentation may be required from corporations, associations
and certain fiduciaries.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods
of unusual market activity), consider placing your order by mail.
THE FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. The fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they would
disrupt management of the fund.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your shares will be purchased at the
next NAV calculated after your request is received and accepted by the
transfer agent . Note the following:
(small solid bullet) All of your purchases must be made in U.S. dollars and
checks must be drawn on U.S. banks.
(small solid bullet) Fidelity does not accept cash.
(small solid bullet) When making a purchase with more than one check, each
check must have a value of at least $50.
(small solid bullet) The fund reserves the right to limit the number of
checks processed at one time.
(small solid bullet) If your check does not clear, your purchase will be
canceled and you could be liable for any losses or fees the fund or
Fidelity has incurred.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your order is received and accepted. Note the
following:
(small solid bullet) Normally, redemption proceeds will be mailed to you on
the next business day, but if making immediate payment could adversely
affect the fund, it may take up to seven days to pay you.
(small solid bullet) Fidelity Money Line (registered trademark)
redemptions generally will be credited to your bank account on the second
or third business day after your phone call.
(small solid bullet) The fund may hold payment on redemptions until it is
reasonably satisfied that investments made by check or Fidelity Money
Line (registered trademark) have been collected, which can take up to
seven business days.
(small solid bullet) Redemptions may be suspended or payment dates
postponed when the NYSE is closed (other than weekends or holidays), when
trading on the NYSE is restricted, or as permitted by the SEC.
For purposes of determining the minimum balance, multiple accounts
registered in the same name within the fund will be aggregated.
IF YOUR ACCOUNT BALANCE FALLS BELOW $100,000, you will be given 30 days'
notice to reestablish the minimum balance. If you do not increase your
balance, Fidelity reserves the right to close your account and send the
proceeds to you. Your shares will be redeemed at the NAV on the day your
account is closed.
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging shares of the fund
for shares of other Fidelity funds. However, you should note the following:
(small solid bullet) The fund you are exchanging into must be registered
for sale in your state.
(small solid bullet) You may only exchange between accounts that are
registered in the same name, address, and taxpayer identification number.
(small solid bullet) Before exchanging into a fund, read its prospectus.
(small solid bullet) If you exchange into a fund with a sales charge, you
pay the difference between that fund's sales charge and any sales
charge you have previously paid in connection with the shares you are
exchanging. For example, if you had already paid a sales charge of 2% on
your shares and you exchange them into a fund with a 3% sales charge, you
would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Because excessive trading can hurt fund performance
and shareholders, the fund reserves the right to temporarily or permanently
terminate the exchange privilege of any investor who makes more than four
exchanges out of the fund per calendar year. Accounts under common
ownership or control, including accounts with the same taxpayer
identification number, will be counted together for purposes of the four
exchange limit.
(small solid bullet) The fund reserves the right to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would be
unable to invest the money effectively in accordance with its investment
objective and policies, or would otherwise potentially be adversely
affected.
(small solid bullet) Your exchanges may be restricted or refused if the
fund receives or anticipates simultaneous orders affecting significant
portions of the fund's assets. In particular, a pattern of exchanges that
coincide s with a "market timing" strategy may be disruptive to the
fund.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any time. The
fund reserves the right to terminate or modify the exchange privilege in
the future.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50% on
exchanges. Check each fund's prospectus for details.
No dealer, sales representative or any other person has been authorized
to give any information or to make any representations, other than those
contained in this Prospectus and in the related SAI, in connection with the
offer contained in this Prospectus. If given or made, such other
information or representations must not be relied upon as having been
authorized by the fund or FDC. This Prospectus and the related SAI do not
constitute an offer by the fund or by FDC to sell or to buy shares of the
fund to any person to whom it is unlawful to make such offer.
APPENDIX
The fund (Product) is not sponsored, endorsed, sold or promoted by
S&P , a division of McGraw-Hill, Inc. S&P makes no representation or
warranty, express or implied, to the owners of the Product or any member of
the public regarding the advisability of investing in securities generally
or in the Product particularly or the ability of the S&P 500 to
track general stock market performance. S&P's only relationship to the
Licensee is the licensing of certain trademarks and trade names of S&P and
of the S&P 500 which is determined, composed and calculated by S&P
without regard to the Licensee or the Product. S&P has no obligation to
take the needs of the Licensee or the owners of the Product into
consideration in determining, composing or calculating the S&P 500 .
S&P is not responsible for and has not participated in the determination of
the timing of, prices at, or quantities of the Product to be issued or in
the determination or calculation of the equation by which the Product is to
be converted into cash. S&P has no obligation or liability in connection
with the administration, marketing or trading of the Product.
S&P does not guarantee the accuracy and/or the completeness of the S&P
500 or any data included therein and S&P shall have no liability for
any errors, omissions, or interruptions therein. S&P makes no warranty,
express or implied, as to results to be obtained by Licensee, owners of the
Product, or any other person or entity from the use of the S&P 500
or any data included therein. S&P makes no express or implied
warranties, and expressly disclaims all warranties of merchantability or
fitness for a particular purpose or use with respect to the S&P 500
or any data included therein. Without limiting any of the foregoing, in
no event shall S&P have any liability for any special, punitive, indirect,
or consequential damages (including lost profits), even if notified of the
possibility of such damages.
"Standard & Poor's," "S&P," "S&P 500," "Standard & Poor's 500," and "500"
are trademarks of McGraw-Hill, Inc. and have been licensed for use by
FDC.
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 $100,000 investment. Each
performance figure includes changes in a fund's share price, plus
reinvestment of any dividends (or income) and capital gains (the profits
the fund earns when it sells stocks that have grown in value). If Fidelity
had not reimbursed certain expenses during the periods shown, the total
returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1995 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Fidelity U.S. Equity Index 7.17% 68.66% 130.51%
S&P 500(registered trademark) 7.36% 71.20% 135.25%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, five years, or since the fund
started on February 17, 1988. For example, if you had invested $1,000 in a
fund that had a 5% return over the past year, you would have $1,050. For
comparison, you can look at the performance of the Standard & Poor's
Composite Index of 500 Stocks (S&P 500) - a common proxy for the U.S. stock
market. This benchmark includes reinvested dividends and capital gains, if
any.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1995 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Fidelity U.S. Equity Index 7.17% 11.02% 12.60%
S&P 500(registered trademark) 7.36% 11.35% 12.92%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$100,000 OVER LIFE OF FUND
US Equity Index (650Standard & Poor's 50
02/17/88 100000.00 100000.00
02/29/88 103400.00 103548.27
03/31/88 100200.00 100348.63
04/30/88 100900.00 101462.50
05/31/88 101700.00 102345.22
06/30/88 106307.66 107042.86
07/31/88 106106.12 106636.10
08/31/88 102478.56 103010.47
09/30/88 106727.96 107398.72
10/31/88 109774.43 110384.40
11/30/88 108149.64 108805.91
12/31/88 110097.83 110710.01
01/31/89 118116.15 118813.98
02/28/89 115237.78 115855.52
03/31/89 117909.84 118554.95
04/30/89 124121.07 124707.95
05/31/89 129090.05 129758.62
06/30/89 128241.54 129019.00
07/31/89 139909.33 140669.41
08/31/89 142513.75 143426.54
09/30/89 141893.03 142838.49
10/31/89 138644.37 139524.63
11/30/89 141473.84 142370.94
12/31/89 144725.55 145787.84
01/31/90 134955.50 136005.47
02/28/90 136673.32 137759.95
03/31/90 140223.80 141410.58
04/30/90 136761.49 137875.32
05/31/90 150069.77 151318.16
06/30/90 148987.01 150289.20
07/31/90 148442.06 149808.27
08/31/90 134818.53 136265.61
09/30/90 128134.10 129629.47
10/31/90 127584.64 129072.06
11/30/90 135826.54 137410.12
12/31/90 139466.58 141243.86
01/31/91 145578.66 147402.09
02/28/91 155913.64 157941.34
03/31/91 159698.28 161763.52
04/30/91 160034.02 162151.76
05/31/91 166860.64 169156.71
06/30/91 159228.13 161409.34
07/31/91 166552.85 168931.01
08/31/91 170496.93 172934.68
09/30/91 167580.94 170046.67
10/31/91 169850.14 172325.29
11/30/91 162929.06 165380.58
12/31/91 181531.45 184300.12
01/31/92 178058.27 180872.14
02/29/92 180373.73 183223.48
03/31/92 176779.45 179650.62
04/30/92 181906.87 184932.35
05/31/92 182839.13 185838.52
06/30/92 180038.57 183069.52
07/31/92 187427.77 190557.06
08/31/92 183557.24 186650.65
09/30/92 185665.47 188853.12
10/31/92 186137.60 189514.11
11/30/92 192511.37 195976.54
12/31/92 194881.44 198387.05
01/31/93 196428.12 200053.50
02/28/93 199045.58 202774.23
03/31/93 203226.05 207052.77
04/30/93 198196.36 202042.09
05/31/93 203494.44 207456.82
06/30/93 203984.00 208058.44
07/31/93 203136.08 207226.21
08/31/93 210888.44 215080.08
09/30/93 209194.03 213423.96
10/31/93 213458.32 217841.84
11/30/93 211387.09 215772.34
12/31/93 213970.40 218383.19
01/31/94 221156.43 225808.22
02/28/94 215085.47 219688.81
03/31/94 205615.41 210110.38
04/30/94 208239.14 212799.80
05/31/94 211615.99 216289.71
06/30/94 206450.48 210990.61
07/31/94 213244.10 217911.11
08/31/94 221799.03 226845.46
09/30/94 216368.32 221287.75
10/31/94 221176.50 226266.72
11/30/94 213078.51 218026.09
12/31/94 216308.32 221259.41
01/31/95 221808.77 226996.67
02/28/95 230507.15 235842.73
$100,000 OVER LIFE OF FUND: Let's say you invested $100,000 in Fidelity
U.S. Equity Index Portfolio on February 17, 1988, when the fund started. As
the chart shows, by February 28, 1995, the value of your investment would
have grown to $230,507 - a 130.51% increase on your initial investment. For
comparison, look at how the S&P 500 did over the same period. With
dividends reinvested, the same $100,000 investment in the S&P 500 would
have grown to $235,248 - a 135.25% 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
Christine
Thompson,
Portfolio Manager
of Fidelity U.S.
Bond Index
Portfolio
Q. JENNIFER, HOW DID THE FUND PERFORM OVER THE PAST YEAR?
A. The fund had a total return of 7.17% for the 12 months ended February
28, 1995. That slightly trailed the Standard & Poor's Composite Index of
500 Stocks - the fund's benchmark - which returned 7.36% during the same
period. The fund attempts to mimic the stock investments of the index, so
this slight difference in returns is due mainly to management and other
expenses.
Q. STOCKS HAVE MADE STRONG GAINS THUS FAR IN 1995. WHAT'S FUELING THIS
RESURGENCE?
A. The S&P 500 did bounce back in January and February, rising nearly 7%
during the two-month period. The gains were due largely to an easing of
interest rate fears and continued excellent corporate earnings. In 1994,
the Federal Reserve Board raised short-term interest rates several times in
an effort to curb future inflation that might be triggered by the
strengthening economy. Although many S&P 500 companies were reporting
record earnings, investors feared higher rates might slow the economy, and
thus, slow earnings growth. But by the end of the year, there was a
widespread feeling among investors that the majority of the rate hikes were
behind us. Those worries aside, strong earnings drove the market to new
highs.
Q. WHICH SECTORS OF THE MARKET SHOWED THE BEST
EARNINGS GROWTH?
A. I would say technology stocks beat analysts' earnings estimates most
consistently and showed the best earnings growth overall. Strong demand for
personal computers and
related products continued, which drove up stock prices in the sector.
Hardware manufacturer IBM, computer workstation producer Sun Microsystems
and software manufacturer Microsoft are among many technology stocks that
performed well over the past six months. In addition, demand remained
strong for semiconductors. Intel has performed well recently, despite
public relations troubles surrounding a flaw in its Pentium microprocessor.
Q. HAVE YOU SEEN ANY RECENT TRENDS SHAPING UP IN THE MARKET?
A. One seemingly prominent trend is the move away from cyclical stocks -
whose performance is closely tied to economic swings - toward growth stocks
- - those of companies with accelerating earnings. As interest rates have
risen, investors have feared these cyclical companies' best earnings growth
may be behind them. That's the main reason the stocks of auto makers such
as Ford and Chrysler, and auto parts manufacturers such as Dana have fallen
in recent months. The same thing has happened to the stocks of home
builders and construction companies. So called deep cyclicals - metals,
chemicals and paper stocks, for example - also have dropped off recently
after performing very well during much of 1994. Investors have gravitated
toward companies that traditionally have been able to maintain steady
earnings growth in the face of higher interest rates.
Q. CAN YOU GIVE US SOME EXAMPLES?
A. Sure. The broad category of consumer nondurables - which makes up more
than 20% of the S&P 500 according to Standard & Poor's sector
classifications - contains a wide range of growth stocks. Beverage stocks
such as Coca-Cola and PepsiCo recently have rebounded from depressed
levels. In addition, health care stocks, which fall under the nondurable
category, led the market in performance over the past 12 months. Once
health care reform was shelved, investors lifted these stocks from
extremely cheap levels. Many health care companies had effectively cut
internal costs, which appeared to give them the ability to grow earnings
despite the trend toward lower prices in the health care industry. For
example, the stocks of pharmaceutical companies Pfizer and Merck rose more
than 20% over the past six months.
Q. CAN THE STOCK MARKET SUSTAIN THIS UPWARD MOMENTUM?
A. That's difficult to predict. I think the performance of stocks in 1995
will hinge largely on the net effects of higher interest rates. If the
Federal Reserve Board can indeed engineer this "soft landing" we've been
hearing so much about - slower, but steady economic growth coupled with
continued low inflation - stocks could do well. However, if past or future
rate hikes make too serious a dent in economic growth, corporate earnings
could suffer sufficiently to bring down stocks.
FUND FACTS
GOAL: to provide returns consistent with those
of the Standard & Poor's 500 index
START DATE: February 17, 1988
SIZE: as of February 28, 1995, more than
$2.2 billion
MANAGER: Jennifer Farrelly, since January
1994; manager, Fidelity Market Index Fund
and VIP II Index 500 Portfolio, since January
1994; manager, institutional enhanced index
funds, since 1988; joined Fidelity in 1988
(checkmark)
JENNIFER FARRELLY ON CHANGES IN THE
S&P 500 INDEX:
"The S&P 500 index consists of companies
from dozens of industry groups, and includes a
representative sample of common stocks
traded on the New York Stock Exchange, the
American Stock Exchange and NASDAQ.
Companies are chosen to join the index mainly
to maintain consistency in the weightings of the
various industry groups. They're often the
largest, most actively traded stocks in their
respective industries.
"Changes are made to the index several times
each year, often the result of corporate
mergers, acquisitions and spin-offs. For
example, PSI Resources - an S&P 500
electric utility servicing Indiana - recently
merged with Cincinnati Gas & Electric. When
that happened, PSI had to be removed from the
index, while the new company - now known as
CINergy - was added."
DISTRIBUTIONS
The Board of Trustees of Fidelity U.S. Equity
Index Portfolio voted to pay on April 10, 1995,
to shareholders of record at the opening of
business on April 7, 1995, a distribution of $.02
derived from capital gains realized from sales of
securities.
A total of 100% of the dividends distributed
during the fiscal year qualifies for the
dividends-received deductions for corporate
shareholders.
The fund will notify shareholders in January
1996 of the applicable percentage for use in
preparing 1995 income tax returns.
INVESTMENTS FEBRUARY 28, 1995
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 96.0%
VALUE (NOTE 1)
SHARES (000S)
AEROSPACE & DEFENSE - 1.6%
AEROSPACE & DEFENSE - 1.1%
Boeing Co. 204,919 $ 9,452
Lockheed Corp. 38,077 2,956
Martin Marietta Corp. 57,224 2,732
McDonnell Douglas Corp. 71,541 4,006
Northrop Corp. 29,654 1,316
Rockwell International Corp. 132,022 5,083
25,545
DEFENSE ELECTRONICS - 0.4%
E-Systems, Inc. 20,536 898
Loral Corp. 50,456 2,063
Raytheon Co. 79,266 5,588
8,549
SHIP BUILDING & REPAIR - 0.1%
General Dynamics Corp. 38,000 1,791
TOTAL AEROSPACE & DEFENSE 35,885
BASIC INDUSTRIES - 7.2%
CHEMICALS & PLASTICS - 4.0%
Air Products & Chemicals, Inc. 68,128 3,355
Avery Dennison Corp. 33,151 1,243
Dow Chemical Co. 166,486 11,155
du Pont (E.I.) de Nemours & Co. 409,240 22,969
Eastman Chemical Co. 49,629 2,717
Engelhard Corp. 57,329 1,512
FMC Corp. (a) 21,853 1,278
First Mississippi Corp. 12,223 296
Goodrich (B.F.) Co. 15,429 687
Grace (W.R.) & Co. 56,598 2,547
Great Lakes Chemical Corp. 41,100 2,471
Hercules, Inc. 70,386 3,088
Minnesota Mining &
Manufacturing Co. 252,730 13,836
Monsanto Co. 69,978 5,546
Morton International, Inc. 88,765 2,596
Nalco Chemical Co. 41,100 1,413
PPG Industries, Inc. 127,970 4,703
Praxair, Inc. 82,595 1,869
Raychem Corp. 26,000 1,050
Rohm & Haas Co. 40,780 2,289
Union Carbide Corp. 89,395 2,559
89,179
IRON & STEEL - 0.3%
Armco, Inc. (a) 63,001 417
Bethlehem Steel Corp. (a) 66,075 1,032
VALUE (NOTE 1)
SHARES (000S)
Inland Steel Industries, Inc. (a) 26,639 $ 766
Nucor Corp. 52,500 2,947
USX-U.S. Steel Group 45,516 1,513
Worthington Industries, Inc. 54,450 1,096
7,771
METALS & MINING - 0.7%
ASARCO, Inc. 25,345 691
Alcan Aluminium Ltd. 132,099 3,220
Aluminum Co. of America 107,606 4,197
Cyprus Amax Minerals Co. 55,573 1,500
Inco Ltd. 70,483 1,896
Phelps Dodge Corp. 42,572 2,320
Reynolds Metals Co. 37,362 1,868
15,692
PACKAGING & CONTAINERS - 0.4%
Ball Corp. 17,756 582
Bemis Co., Inc. 30,860 837
Corning, Inc. 136,716 4,392
Crown Cork & Seal Co., Inc. (a) 53,708 2,289
8,100
PAPER & FOREST PRODUCTS - 1.8%
Boise Cascade Corp. 22,936 737
Champion International Corp. 56,011 2,303
Federal Paper Board Co., Inc. 25,444 757
Georgia-Pacific Corp. 54,323 4,067
International Paper Co. 75,123 5,738
James River Corp. of Virginia 49,159 1,211
Kimberly-Clark Corp. 96,200 5,002
Louisiana-Pacific Corp. 67,362 1,903
Mead Corp. 35,673 1,953
Potlatch Corp. 17,631 760
Scott Paper Co. 45,284 3,589
Stone Container Corp. (a) 54,427 1,272
Temple-Inland, Inc. 33,520 1,638
Union Camp Corp. 41,986 2,162
Westvaco Corp. 40,276 1,591
Weyerhaeuser Co. 123,538 5,035
39,718
TOTAL BASIC INDUSTRIES 160,460
CONGLOMERATES - 1.3%
Allied-Signal, Inc. 170,052 6,462
Crane Co. 18,003 542
Dial Corp. (The) 55,700 1,393
COMMON STOCKS - CONTINUED
VALUE (NOTE 1)
SHARES (000S)
CONGLOMERATES - CONTINUED
Harris Corp. 23,648 $ 1,064
ITT Corp. 64,165 6,256
Teledyne, Inc. 33,270 769
Textron, Inc. 53,401 2,924
Tyco Laboratories, Inc. 44,500 2,320
United Technologies Corp. 74,853 4,968
Whitman Corp. 63,330 1,195
27,893
CONSTRUCTION & REAL ESTATE - 0.5%
BUILDING MATERIALS - 0.3%
Armstrong World Industries, Inc. 22,655 1,036
Masco Corp. 96,154 2,416
Owens-Corning Fiberglas Corp. (a) 26,646 896
Sherwin-Williams Co. 51,504 1,732
6,080
CONSTRUCTION - 0.1%
Centex Corp. 17,638 450
Kaufman & Broad Home Corp. 19,393 284
Morrison-Knudsen Corp. 19,800 153
Pulte Corp. 16,628 382
Skyline Corp. 6,613 121
1,390
ENGINEERING - 0.1%
EG & G, Inc. 33,064 475
Fluor Corp. 49,492 2,413
Foster Wheeler Corp. 21,441 702
3,590
TOTAL CONSTRUCTION & REAL ESTATE 11,060
DURABLES - 3.8%
AUTOS, TIRES, & ACCESSORIES - 3.0%
Chrysler Corp. 213,012 9,265
Cooper Tire & Rubber Co. 50,200 1,406
Cummins Engine Co., Inc. 25,074 1,141
Dana Corp. 59,304 1,460
Eaton Corp. 45,798 2,296
Echlin, Inc. 35,465 1,228
Ford Motor Co. 613,526 16,027
General Motors Corp. 453,061 19,312
Genuine Parts Co. 74,088 2,880
Goodyear Tire & Rubber Co. 90,932 3,353
Johnson Controls, Inc. 24,544 1,221
NACCO Industries, Inc. Class A 5,310 273
Navistar International Corp. (a) 45,007 653
PACCAR, Inc. 23,423 1,031
VALUE (NOTE 1)
SHARES (000S)
Pep Boys-Manny, Moe & Jack 36,800 $ 1,205
SPX Corp. 7,714 118
Snap-on Tools Corp. 25,848 879
Strattec Security Corp. 3,466 44
TRW, Inc. 39,069 2,569
66,361
CONSUMER ELECTRONICS - 0.4%
Black & Decker Corp. 50,868 1,361
Maytag Co. 64,590 1,066
Newell Co. 94,800 2,263
Stanley Works 27,001 1,090
Whirlpool Corp. 44,881 2,440
8,220
HOME FURNISHINGS - 0.0%
Bassett Furniture Industries, Inc. 8,431 234
TEXTILES & APPAREL - 0.4%
Hartmarx Corp. (a) 19,424 112
Liz Claiborne, Inc. 46,801 755
NIKE, Inc. Class B 44,100 3,170
Oshkosh B'Gosh, Inc. Class A 8,217 117
Reebok International Ltd. 48,831 1,789
Russell Corp. 23,946 724
Springs Industries, Inc. Class A 10,521 414
Stride Rite Corp. 29,700 382
VF Corp. 38,816 1,999
9,462
TOTAL DURABLES 84,277
ENERGY - 9.4%
COAL - 0.0%
Eastern Enterprises Co. 12,327 325
ENERGY SERVICES - 0.7%
Baker Hughes, Inc. 84,595 1,628
Dresser Industries, Inc. 110,576 2,281
Halliburton Co. 68,523 2,552
Helmerich & Payne, Inc. 14,928 388
McDermott International, Inc. 32,243 903
Rowan Companies, Inc. (a) 50,582 316
Schlumberger Ltd. 146,400 8,327
16,395
OIL & GAS - 8.7%
Amerada Hess Corp. 55,998 2,744
Amoco Corp. 298,798 17,705
Ashland, Inc. 36,400 1,178
Atlantic Richfield Co. 96,508 10,580
Burlington Resources, Inc. 76,300 2,938
COMMON STOCKS - CONTINUED
VALUE (NOTE 1)
SHARES (000S)
ENERGY - CONTINUED
OIL & GAS - CONTINUED
Chevron Corp. 391,696 $ 18,606
Coastal Corp. (The) 63,029 1,804
Exxon Corp. 746,359 47,767
Kerr-McGee Corp. 31,156 1,569
Louisiana Land & Exploration Co. 20,136 697
Maxus Energy Corp. (a) 80,904 435
Mobil Corp. 238,978 20,791
Occidental Petroleum Corp. 187,738 3,731
Oryx Energy Co. (a) 59,426 654
Pennzoil Co. 27,648 1,310
Phillips Petroleum Co. 157,166 5,245
Royal Dutch Petroleum Co. 322,324 36,141
Santa Fe Energy Resources, Inc. (a) 54,032 486
Sun Company, Inc. 64,326 1,873
Texaco, Inc. 155,932 9,941
USX-Marathon Group 172,582 2,804
Unocal Corp. 147,530 4,186
193,185
TOTAL ENERGY 209,905
FINANCE - 10.8%
BANKS - 5.4%
Banc One Corp. 244,115 7,171
BankAmerica Corp. 223,435 10,753
Bank of Boston Corp. 64,362 1,939
Bankers Trust New York Corp. 46,789 2,954
Barnett Banks, Inc. 58,244 2,592
Boatmen's Bancshares, Inc. 63,100 1,956
Chase Manhattan Corp. 109,108 3,914
Chemical Banking Corp. 147,027 5,899
Citicorp 238,299 10,721
CoreStates Financial Corp. 84,500 2,546
First Chicago Corp. 55,148 2,792
First Fidelity Bancorporation 49,678 2,509
First Interstate Bancorp 45,832 3,730
First Union Corp. 105,889 4,725
Fleet Financial Group, Inc. 82,147 2,557
Keycorp 146,455 4,247
Mellon Bank Corp. 88,259 3,365
Morgan (J.P.) & Co., Inc. 113,623 7,329
NBD Bancorp, Inc. 94,043 2,927
National City Corp. 91,321 2,534
NationsBank Corp. 166,334 8,296
Norwest Corp. 185,604 4,779
PNC Financial Corp. 141,268 3,602
Shawmut National Corp. 73,032 1,871
VALUE (NOTE 1)
SHARES (000S)
SunTrust Banks, Inc. 70,900 $ 3,820
U.S. Bancorp 59,250 1,489
Wachovia Corp. 102,800 3,572
Wells Fargo & Co. 31,657 5,085
119,674
CREDIT & OTHER FINANCE - 1.0%
American Express Co. 304,772 10,286
Beneficial Corp. 30,654 1,138
Dean Witter Discover & Co. 102,620 4,143
Household International, Inc. 58,415 2,556
MBNA Corp. 89,350 2,357
Transamerica Corp. 42,326 2,312
22,792
FEDERAL SPONSORED CREDIT - 0.8%
Federal Home Loan Mortgage
Corporation 108,300 6,281
Federal National Mortgage Association 164,200 12,664
18,945
INSURANCE - 3.1%
Aetna Life & Casualty Co. 67,632 3,635
Alexander & Alexander Services, Inc. 26,300 572
American General Corp. 123,708 3,912
American International Group, Inc. 190,068 19,720
CIGNA Corp. 43,494 3,295
Chubb Corp. (The) 52,294 4,112
Continental Corp. 33,271 645
General Re Corp. 49,100 6,395
Jefferson Pilot Corp. 29,219 1,665
Lincoln National Corp. 57,000 2,301
Marsh & McLennan Companies, Inc. 44,387 3,640
Providian Corp. 59,012 2,088
SAFECO Corp. 37,778 2,078
St. Paul Companies, Inc. (The) 50,508 2,456
Torchmark Corp. 42,950 1,799
Travelers, Inc. (The) 192,527 7,483
UNUM Corp. 43,600 1,853
USF&G Corp. 53,889 768
USLIFE Corp. 13,631 520
68,937
SAVINGS & LOANS - 0.2%
Ahmanson (H.F.) & Co. 68,714 1,263
Golden West Financial Corp. 36,300 1,388
Great Western Financial Corp. 80,369 1,507
4,158
COMMON STOCKS - CONTINUED
VALUE (NOTE 1)
SHARES (000S)
FINANCE - CONTINUED
SECURITIES INDUSTRY - 0.3%
Merrill Lynch & Co., Inc. 114,454 $ 4,693
Salomon, Inc. 63,553 2,288
6,981
TOTAL FINANCE 241,487
HEALTH - 9.1%
DRUGS & PHARMACEUTICALS - 5.3%
ALZA Corp. Class A (a) 49,200 1,119
Allergan, Inc. 38,300 1,106
American Home Products Corp. 183,942 13,152
Amgen, Inc. (a) 79,800 5,506
Bristol-Myers Squibb Co. 306,914 19,029
Lilly (Eli) & Co. 175,724 11,774
Merck & Co., Inc. 756,531 32,058
Pfizer, Inc. 189,284 15,663
Schering-Plough Corp. 114,474 8,972
Sigma Aldrich Corp. 29,900 1,091
Upjohn Co. 104,018 3,667
Warner-Lambert Co. 80,968 6,184
119,321
MEDICAL EQUIPMENT & SUPPLIES - 2.8%
Abbott Laboratories 484,756 17,209
Bard (C.R.), Inc. 31,368 839
Bausch & Lomb, Inc. 35,470 1,179
Baxter International, Inc. 170,180 5,298
Becton, Dickinson & Co. 42,092 2,210
Biomet, Inc. (a) 68,800 1,114
Boston Scientific Corp. 60,300 1,304
Johnson & Johnson 386,404 21,928
Mallinckrodt Group, Inc. 45,996 1,506
McKesson Corp. 22,047 813
Medtronic, Inc. 69,120 4,147
Millipore Corp. 14,800 786
Pall Corp. 69,228 1,393
St. Jude Medical, Inc. 27,300 990
U.S. Surgical Corp. 34,200 718
61,434
MEDICAL FACILITIES MANAGEMENT - 1.0%
Beverly Enterprises, Inc. (a) 51,367 668
Columbia/HCA Healthcare Corp. 217,617 9,003
Community Psychiatric Centers 26,154 304
Manor Care, Inc. 37,420 1,109
VALUE (NOTE 1)
SHARES (000S)
National Medical Enterprises, Inc. (a) 99,874 $ 1,548
United HealthCare Corp. 103,500 4,451
U.S. Healthcare, Inc. 96,100 4,132
21,215
TOTAL HEALTH 201,970
HOLDING COMPANIES - 0.1%
CINergy Corp. 88,748 2,197
INDUSTRIAL MACHINERY & EQUIPMENT - 5.4%
ELECTRICAL EQUIPMENT - 3.4%
Emerson Electric Co. 134,573 8,899
General Electric Co. 1,027,830 56,402
General Signal Corp. 28,272 1,014
Grainger (W.W.), Inc. 30,566 1,868
Honeywell, Inc. 77,700 2,826
Scientific-Atlanta, Inc. 45,680 1,068
Westinghouse Electric Corp. 213,934 3,316
Zenith Electronics Corp. (a) 26,530 216
75,609
INDUSTRIAL MACHINERY & EQUIPMENT - 1.4%
Briggs & Stratton Corp. 17,334 602
Caterpillar, Inc. 121,730 6,285
Cincinnati Milacron, Inc. 20,228 425
Clark Equipment Co. (a) 10,520 563
Cooper Industries, Inc. 69,314 2,721
Deere & Co. 51,879 3,975
Dover Corp. 34,478 2,051
Giddings & Lewis, Inc. 20,700 352
Harnischfeger Industries, Inc. 27,544 768
Illinois Tool Works, Inc. 68,320 3,066
Ingersoll-Rand Co. 63,322 2,018
Parker-Hannifin Corp. 29,353 1,372
TRINOVA Corp. 17,240 465
Tenneco, Inc. 102,941 4,685
Timken Co. 18,604 667
Varity Corp. (a) 26,359 962
30,977
POLLUTION CONTROL - 0.6%
Browning-Ferris Industries, Inc. 118,270 3,681
Ogden Corp. 29,245 625
Rollins Environmental Services, Inc. (a) 36,224 186
Safety Kleen Corp. 34,807 574
COMMON STOCKS - CONTINUED
VALUE (NOTE 1)
SHARES (000S)
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
POLLUTION CONTROL - CONTINUED
WMX Technologies, Inc. 290,947 $ 7,674
Zurn Industries, Inc. 7,514 135
12,875
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 119,461
MEDIA & LEISURE - 5.0%
BROADCASTING - 1.8%
CBS, Inc. 36,790 2,373
Capital Cities/ABC, Inc. 92,690 8,203
Comcast Corp. Class A 143,650 2,262
Cox Communications, Inc. Class A (a) 42,251 724
Tele-Communications, Inc. Class A (a) 343,252 7,809
Time Warner, Inc. 227,895 8,802
Viacom, Inc. Class A (a) 21,200 981
Viacom, Inc. Class B (non-vtg.) (a) 193,700 8,668
39,822
ENTERTAINMENT - 0.8%
Disney (Walt) Co. 321,612 17,166
King World Productions, Inc. (a) 22,150 789
17,955
LEISURE DURABLES & TOYS - 0.3%
Brunswick Corp. 57,303 1,139
Fleetwood Enterprises, Inc. 27,554 603
Hasbro, Inc. 52,741 1,661
Mattel, Inc. 134,060 3,000
Outboard Marine Corp. 11,723 246
6,649
LODGING & GAMING - 0.3%
Bally Entertainment Corp. (a) 28,133 218
Hilton Hotels Corp. 28,958 2,034
Marriott International, Inc. 74,540 2,311
Promus Companies, Inc. (a) 61,643 2,204
6,767
PUBLISHING - 1.1%
American Greetings Corp. Class A 44,800 1,316
Dow Jones & Co., Inc. 59,013 2,088
Dun & Bradstreet Corp. 102,020 5,266
Gannett Co., Inc. 83,588 4,597
Harcourt General, Inc. 46,898 1,741
Knight-Ridder, Inc. 32,167 1,765
McGraw-Hill, Inc. 29,759 2,098
Meredith Corp. 8,322 405
New York Times Co. (The) Class A 59,895 1,288
VALUE (NOTE 1)
SHARES (000S)
Times Mirror Co. Class A 77,250 $ 1,429
Tribune Co. 40,192 2,246
24,239
RESTAURANTS - 0.7%
Luby's Cafeterias, Inc. 15,206 346
McDonald's Corp. 419,984 13,964
Ryan's Family Steak Houses, Inc. (a) 32,200 250
Shoney's, Inc. (a) 24,842 273
Wendy's International, Inc. 60,962 945
15,778
TOTAL MEDIA & LEISURE 111,210
NONDURABLES - 11.3%
AGRICULTURE - 0.1%
Pioneer Hi-Bred International, Inc. 51,300 1,731
BEVERAGES - 3.5%
Anheuser-Busch Companies, Inc. 155,784 8,782
Brown-Forman Corp. Class B 41,561 1,346
Coca-Cola Company (The) 772,848 42,507
Coors (Adolph) Co. Class B 22,942 373
PepsiCo, Inc. 476,209 18,632
Seagram Co. Ltd. 223,844 6,907
78,547
FOODS - 2.8%
Archer-Daniels-Midland Co. 310,217 5,894
CPC International, Inc. 88,690 4,745
Campbell Soup Co. 149,202 6,770
ConAgra, Inc. 149,229 4,887
General Mills, Inc. 94,906 5,754
Heinz (H.J.) Co. 148,198 5,835
Hershey Foods Corp. 52,205 2,558
Kellogg Co. 133,588 7,230
Quaker Oats Co. 80,186 2,616
Ralston Purina Co. 60,060 2,868
SYSCO Corp. 110,208 3,127
Sara Lee Corp. 289,316 7,595
Wrigley (Wm.) Jr. Company 69,844 3,152
63,031
HOUSEHOLD PRODUCTS - 3.1%
Alberto Culver Co. Class B 16,932 483
Avon Products, Inc. 41,782 2,350
Clorox Co. 32,062 1,936
Colgate-Palmolive Co. 87,058 5,615
Gillette Co. 133,146 10,535
COMMON STOCKS - CONTINUED
VALUE (NOTE 1)
SHARES (000S)
NONDURABLES - CONTINUED
HOUSEHOLD PRODUCTS - CONTINUED
International Flavors & Fragrances, Inc. 66,932 $ 3,221
Premark International, Inc. 38,500 1,665
Procter & Gamble Co. 412,078 27,403
Rubbermaid, Inc. 97,070 3,070
Unilever NV ADR 96,286 11,699
67,977
TOBACCO - 1.8%
American Brands, Inc. 121,156 4,528
Philip Morris Companies, Inc. 516,718 31,390
UST, Inc. 120,860 3,596
39,514
TOTAL NONDURABLES 250,800
PRECIOUS METALS - 0.5%
Barrick Gold Corp. 210,300 4,578
Echo Bay Mines Ltd. 67,700 621
Homestake Mining Co. 82,910 1,285
Newmont Mining Corp. 51,725 1,869
Placer Dome, Inc. 143,235 2,938
Santa Fe Pacific Gold Corp. 78,879 858
12,149
RETAIL & WHOLESALE - 5.4%
APPAREL STORES - 0.4%
Brown Group, Inc. 10,721 346
Charming Shoppes, Inc. 61,716 378
Gap, Inc. 87,764 2,852
Limited, Inc. (The) 215,240 3,767
Melville Corp. 63,426 2,061
TJX Companies, Inc. 44,066 595
9,999
DRUG STORES - 0.2%
Long Drug Stores, Inc. 12,325 391
Rite Aid Corp. 50,596 1,252
Walgreen Co. 74,044 3,499
5,142
GENERAL MERCHANDISE STORES - 3.1%
Dayton Hudson Corp. 43,116 3,040
Dillard Department Stores, Inc. Class A 67,861 1,866
K mart Corp. 273,968 3,493
May Department Stores Co. (The) 149,230 5,447
Mercantile Stores Co., Inc. 22,093 920
Nordstrom, Inc. 49,294 2,083
Penney (J.C.) Co., Inc. 140,224 6,012
VALUE (NOTE 1)
SHARES (000S)
Price/Costco, Inc. (a) 117,163 $ 1,596
Sears, Roebuck & Co. 211,340 10,408
Wal-Mart Stores, Inc. 1,381,528 32,812
Woolworth Corp. 79,552 1,213
68,890
GROCERY STORES - 0.7%
Albertson's, Inc. 152,512 4,690
American Stores Co. 85,740 2,101
Bruno's, Inc. 47,000 479
Fleming Companies, Inc. 19,806 386
Giant Food, Inc. Class A 35,570 845
Great Atlantic & Pacific Tea Co., Inc. 23,044 444
Kroger Co. (The) (a) 70,294 1,845
Supervalu, Inc. 42,887 1,104
Winn-Dixie Stores, Inc. 44,596 2,497
14,391
RETAIL & WHOLESALE, MISCELLANEOUS - 1.0%
Circuit City Stores, Inc. 58,000 1,254
Handleman Co. (Del.) 20,211 215
Home Depot, Inc. (The) 271,600 12,187
Lowe's Companies, Inc. 91,584 3,080
Tandy Corp. 37,165 1,663
Toys "R" Us, Inc. (a) 171,250 4,774
23,173
TOTAL RETAIL & WHOLESALE 121,595
SERVICES - 0.8%
ADVERTISING - 0.1%
Interpublic Group of Companies, Inc. 46,200 1,577
LEASING & RENTAL - 0.0%
Ryder Systems, Inc. 47,291 1,100
PRINTING - 0.4%
Alco Standard Corp. 32,734 2,226
Deluxe Corp. 49,699 1,392
Donnelley (R.R.) & Sons Co. 92,282 3,160
Harland (John H.) Co. 18,400 416
Moore Corporation Ltd. 59,907 1,116
8,310
SERVICES - 0.3%
Block (H & R), Inc. 62,620 2,356
Ecolab, Inc. 40,600 939
Jostens, Inc. 27,400 572
National Education Corp. (a) 17,700 53
National Service Industries, Inc. 29,557 794
COMMON STOCKS - CONTINUED
VALUE (NOTE 1)
SHARES (000S)
SERVICES - CONTINUED
SERVICES - CONTINUED
Service Corp. International 56,532 $ 1,590
Western Atlas, Inc. 31,860 1,314
7,618
TOTAL SERVICES 18,605
TECHNOLOGY - 9.5%
COMMUNICATIONS EQUIPMENT - 0.6%
Andrew Corp. (a) 15,386 892
Cisco Systems, Inc. (a) 155,000 5,232
DSC Communications Corp. (a) 68,092 2,451
M/A-Com, Inc. (a) 15,636 107
Northern Telecom Ltd. 151,975 5,223
13,905
COMPUTER SERVICES & SOFTWARE - 2.4%
Autodesk, Inc. 28,200 1,107
Automatic Data Processing, Inc. 84,880 5,220
Ceridian Corp. (a) 26,948 849
Computer Associates International, Inc. 96,751 5,515
Computer Sciences Corp. (a) 30,654 1,506
First Data Corp. 66,100 3,553
Lotus Development Corp. (a) 28,649 1,196
Microsoft Corp. (a) 350,100 22,056
Novell, Inc. (a) 222,400 4,521
Oracle Systems Corp. (a) 258,150 8,099
Shared Medical Systems Corp. 13,729 473
54,095
COMPUTERS & OFFICE EQUIPMENT - 3.3%
Amdahl Corp. (a) 70,022 779
Apple Computer, Inc. 71,446 2,822
Compaq Computer Corp. (a) 155,400 5,361
Cray Research, Inc. (a) 15,518 262
Data General Corp. (a) 21,732 171
Digital Equipment Corp. (a) 85,747 2,873
Hewlett-Packard Co. 152,900 17,583
Intergraph Corp. (a) 26,766 328
International Business Machines Corp. 352,927 26,557
Pitney Bowes, Inc. 93,778 3,329
Silicon Graphics, Inc. (a) 87,000 3,012
Sun Microsystems, Inc. (a) 55,300 1,770
Tandem Computers, Inc. (a) 69,207 1,177
Unisys Corp. (a) 102,785 912
Xerox Corp. 63,573 7,049
73,985
VALUE (NOTE 1)
SHARES (000S)
ELECTRONIC INSTRUMENTS - 0.1%
Perkin-Elmer Corp. 25,453 $ 728
Tektronix, Inc. 18,332 628
1,356
ELECTRONICS - 2.6%
AMP, Inc. 63,126 4,734
Advanced Micro Devices, Inc. (a) 57,190 1,737
Intel Corp. 249,180 19,872
Micron Technology, Inc. 61,200 3,794
Motorola, Inc. 352,500 20,270
National Semiconductor Corp. (a) 74,020 1,249
Texas Instruments, Inc. 55,591 4,378
Thomas & Betts Corp. 11,720 781
56,815
PHOTOGRAPHIC EQUIPMENT - 0.5%
Eastman Kodak Co. 204,119 10,410
Polaroid Corp. 27,891 837
11,247
TOTAL TECHNOLOGY 211,403
TRANSPORTATION - 1.6%
AIR TRANSPORTATION - 0.3%
AMR Corp. (a) 45,668 2,791
Delta Air Lines, Inc. 30,257 1,755
Pittston Company Services Group 25,148 629
Southwest Airlines Co. 86,000 1,515
USAir Group, Inc. (a) 36,350 214
6,904
RAILROADS - 1.1%
Burlington Northern, Inc. 53,586 3,001
CSX Corp. 63,029 4,901
Conrail, Inc. 47,360 2,617
Norfolk Southern Corp. 80,921 5,351
Santa Fe Pacific Corp. 48,903 1,039
Union Pacific Corp. 123,344 6,444
23,353
TRUCKING & FREIGHT - 0.2%
Consolidated Freightways, Inc. 21,745 516
Federal Express Corp. (a) 33,561 2,186
Roadway Services, Inc. 23,397 1,269
Yellow Corp. 16,833 356
4,327
TOTAL TRANSPORTATION 34,584
COMMON STOCKS - CONTINUED
VALUE (NOTE 1)
SHARES (000S)
UTILITIES - 12.7%
CELLULAR - 0.4%
Airtouch Communications (a) 296,803 $ 8,088
ELECTRIC UTILITY - 3.8%
American Electric Power Co., Inc. 111,225 3,768
Baltimore Gas & Electric Co. 88,738 2,185
Carolina Power & Light Co. 94,600 2,602
Central & South West Corp. 114,120 2,810
Consolidated Edison Co. of
New York, Inc. 141,268 3,903
Detroit Edison Company 87,171 2,495
Dominion Resources, Inc. (Va.) 103,515 3,934
Duke Power Co. 123,236 4,837
Entergy Corp. 136,638 3,057
FPL Group, Inc. 112,251 4,027
General Public Utilities Corp. 73,700 2,229
Houston Industries, Inc. 78,836 3,015
Niagara Mohawk Power Corp. 86,549 1,287
Northern States Power Co. (Minn.) 40,173 1,818
Ohio Edison Co. 91,677 1,925
Peco Energy Co. 133,125 3,561
Pacific Gas & Electric Co. 259,928 6,661
PacifiCorp. 170,300 3,257
Public Service Enterprise Group, Inc. 147,038 4,282
SCEcorp 269,106 4,407
Southern Co. 392,880 8,103
Texas Utilities Co. 135,834 4,466
Unicom Corp. 128,840 3,285
Union Electric Co. 61,300 2,322
84,236
GAS - 0.7%
Columbia Gas System, Inc. (The) (a) 30,352 789
Consolidated Natural Gas Co. 55,997 2,072
ENSERCH Corp. 40,166 562
Enron Corp. 152,016 5,018
NICOR, Inc. 31,200 772
Noram Energy Corp. 73,600 414
ONEOK, Inc. 16,132 278
Pacific Enterprises 49,269 1,207
Panhandle Eastern Corp. 89,707 2,018
Peoples Energy Corp. 21,038 552
Sonat, Inc. 52,394 1,519
Transco Energy Co. 7,442 132
Williams Companies, Inc. 54,488 1,567
16,900
VALUE (NOTE 1)
SHARES (000S)
TELEPHONE SERVICES - 7.8%
AT&T Corp. 939,686 $ 48,629
ALLTEL Corp. 112,800 3,229
Ameritech Corp. 330,844 14,185
Bell Atlantic Corp. 262,162 14,058
BellSouth Corp. 298,260 17,597
GTE Corp. 578,368 19,303
MCI Communications Corp. 408,562 8,222
NYNEX Corp. 253,676 9,957
Pacific Telesis Group 255,003 7,650
Southwestern Bell Corp. 360,398 15,002
Sprint Corp. 209,600 6,131
U.S. West, Inc. 274,142 10,623
174,586
TOTAL UTILITIES 283,810
TOTAL COMMON STOCKS
(Cost $1,827,161) 2,138,751
NONCONVERTIBLE PREFERRED STOCKS - 0.0%
CONGLOMERATES - 0.0%
Teledyne, Inc., Series E, 8% (Cost $0) 332 -
U.S. TREASURY OBLIGATIONS (B) - 0.2%
PRINCIPAL
AMOUNT
(000S)
U.S. Treasury Bills, yield at date of purchase
5.96% to 6.09%, 7/6/95 to 7/13/95 $ 1,500 1,468
8 1/2%, 5/15/95 500 503
8 5/8%, 10/15/95 3,000 3,040
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $5,328) 5,011
REPURCHASE AGREEMENTS - 3.8%
MATURITY VALUE
AMOUNT (NOTE 1)
(000S) (000S)
Investments in repurchase agreements
(U.S. Treasury obligations), in a
joint trading account, at 6.08%
dated 2/28/95 due 3/1/95 $ 84,928 $ 84,914
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,917,403) $ 2,228,676
FUTURES CONTRACTS
AMOUNTS IN EXPIRATION UNDERLYING FACE UNREALIZED
THOUSANDS DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
392 S&P Stock 500
Index Futures March, 1995 $ 95,756 $ 4,189
THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 4.3%
LEGEND
(e) Non-income producing
(f) These securities were pledged to cover margin requirements for futures
contracts. At the period end, the value of securities pledged amounted to
$5,011,000.
INCOME TAX INFORMATION
At February 28, 1995, the aggregate cost of investment securities for
income tax purposes was $1,921,795,000. Net unrealized appreciation
aggregated $306,881,000, of which $392,046,000 related to appreciated
investment securities and $85,165,000 related to depreciated investment
securities.
The fund hereby designates $2,837,000 as a capital gain dividend for the
purpose of the dividend paid deduction.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNT) FEBRUARY 28, 1995
ASSETS 152. 153.
154.Investment in securities, at value (including repurchase agreements of $84,914) (cost 155. $ 2,228,676
$1,917,403) -
See accompanying schedule
156.Cash 157. 3
158.Receivable for fund shares sold 159. 4,247
160.Dividends receivable 161. 6,957
162.Interest receivable 163. 109
164.Receivable for daily variation on futures contracts 165. 700
166.Other receivables 167. 13
168.Receivable from investment adviser for expense reductions 169. 514
170. TOTAL ASSETS 171. 2,241,219
LIABILITIES 172. 173.
174.Payable for investments purchased $ 1,317 175.
176.Payable for fund shares redeemed 3,029 177.
178.Accrued management fee 515 179.
180.Other payables and accrued expenses 714 181.
182.Collateral on securities loaned, at value 752 183.
184. TOTAL LIABILITIES 185. 6,327
186.NET ASSETS 187. $ 2,234,892
188.Net Assets consist of: 189. 190.
191.Paid in capital 192. $ 1,916,218
193.Undistributed net investment income 194. 7,791
195.Accumulated undistributed net realized gain (loss) on investments and foreign transactions 196. (4,579)
197.Net unrealized appreciation (depreciation) on investments 198. 315,462
199.NET ASSETS, for 124,049 shares outstanding 200. $ 2,234,892
201.NET ASSET VALUE, offering price and redemption price per share ($2,234,892 (divided by) 124,049 shares) 202. $18.02
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED FEBRUARY 28, 1995
INVESTMENT INCOME 204. $ 53,643
203.Dividends
205.Interest (including security lending fees of $74) 206. 3,721
207. TOTAL INCOME 208. 57,364
EXPENSES 209. 210.
211.Management fee $ 5,488 212.
213.Transfer agent fees 4,976 214.
215.Accounting and security lending fees 733 216.
217.Non-interested trustees' compensation 27 218.
219.Custodian fees and expenses 88 220.
221.Registration fees 79 222.
223.Audit 62 224.
225.Legal 20 226.
227.Interest 2 228.
229.Miscellaneous 18 230.
231. Total expenses before reductions 11,493 232.
233. Expense reductions (6,009) 5,484
234.NET INVESTMENT INCOME 235. 51,880
REALIZED AND UNREALIZED GAIN (LOSS) 237. 238.
236.Net realized gain (loss) on:
239. Investment securities 2,555 240.
241. Futures contracts (512) 2,043
242.Change in net unrealized appreciation (depreciation) on: 243. 244.
245. Investment securities 91,212 246.
247. Futures contracts 4,770 95,982
248.NET GAIN (LOSS) 249. 98,025
250.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 251. $ 149,905
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 28,
1995 1994
INCREASE (DECREASE) IN NET ASSETS
252.Operations $ 51,880 $ 42,617
Net investment income
253. Net realized gain (loss) 2,043 27,472
254. Change in net unrealized appreciation (depreciation) 95,982 54,942
255. 149,905 125,031
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS
256.Distributions to shareholders: (48,368) (41,086)
From net investment income
257. From net realized gain (8,480) (23,556)
258. In excess of net realized gain (4,020) -
259. TOTAL DISTRIBUTIONS (60,868) (64,642)
260.Share transactions 944,087 1,395,243
Net proceeds from sales of shares
261. Reinvestment of distributions 58,211 60,945
262. Cost of shares redeemed (748,697) (1,096,425)
263. 253,601 359,763
Net increase (decrease) in net assets resulting from share transactions
264. 342,638 420,152
TOTAL INCREASE (DECREASE) IN NET ASSETS
NET ASSETS 265. 266.
267. Beginning of period 1,892,254 1,472,102
268. $ 2,234,892 $ 1,892,254
End of period (including undistributed net investment income of $7,791 and $6,425, respectively)
OTHER INFORMATION 270. 271.
269.Shares
272. Sold 55,584 85,203
273. Issued in reinvestment of distributions 3,459 3,597
274. Redeemed (44,005) (67,777)
275. Net increase (decrease) 15,038 21,023
</TABLE>
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1995
7. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity U.S. Equity Index Portfolio (the fund) is a fund of Fidelity
Institutional Trust (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 following
summarizes the significant accounting policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are readily
available are valued at the last sale price, or if no sale price, at the
closing bid price. Securities for which exchange quotations are not readily
available (and in certain cases debt securities which trade on an
exchange), are valued primarily using dealer-supplied valuations or at
their fair value as determined in good faith under consistently applied
procedures under the general supervision of the Board of Trustees.
Short-term securities maturing within sixty days of their purchase date are
valued at amortized cost or original cost plus accrued interest, both of
which approximate current value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Purchases and
sales of securities, income receipts, and expense payments are translated
into U.S. dollars at the prevailing exchange rate on the respective dates
of the transactions.
Effective March 1,1994, the fund adopted Statement of Position (SOP) 93-4:
Foreign Currency Accounting and Financial Statement Presentation for
Investment Companies. As permitted under the SOP, the effects of changes
in foreign currency exchange rates on investments in securities are not
segregated in the Statement of Operations from the effects of changes in
market prices of those securities, but 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 all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. Interest income, which includes accretion of original
issue discount, is accrued as earned. Investment income is recorded net of
foreign taxes withheld where recovery of such taxes is uncertain.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
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,
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 and may
affect net investment income per share. Undistributed net investment income
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.
8. OPERATING POLICIES.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The fund's investment
adviser, Fidelity Management & Research Company (FMR), is responsible for
determining that the value of these underlying securities remains at least
equal to the resale price.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of FMR, may transfer uninvested cash balances into one or more
joint trading accounts. These balances are invested in one or more
repurchase agreements that mature in 60 days or less from the date of
purchase, and are collateralized by U.S. Treasury or Federal Agency
obligations.
FUTURES CONTRACTS AND OPTIONS. The fund may use futures and options
contracts to manage its exposure to the stock market. Buying futures,
writing puts, and buying calls tend to increase the fund's exposure to the
underlying instrument. Selling futures, buying puts, and writing calls tend
to decrease the fund's exposure to the underlying instrument, or hedge
other fund investments. Futures contracts and written options involve, to
varying degrees, risk of loss in excess of the futures variation margin or
the option value reflected in the Statement of Assets and Liabilities. The
underlying face amount at value is shown in the schedule of investments
under the caption "Futures Contracts." This amount reflects each contract's
exposure to the underlying instrument at period end. Losses may arise from
changes in the value of the underlying instruments, if there is an illiquid
secondary market for the contracts, or if the counterparties do not perform
under the contracts' terms.
Futures contracts are valued at the settlement price established each day
by the board of trade or exchange on which they are traded. Exchange-traded
options are valued using the last sale price or, in the absence of a sale,
the last offering price. Options traded over-the-counter are valued using
dealer-supplied valuations.
9. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $408,614,000 and $200,902,000, respectively, of which U.S.
government and government agency obligations sales aggregated $1,500,000.
The market value of futures contracts opened and closed during the period
amounted to $527,693,000 and $492,836,000, respectively.
10. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a fee that
is computed daily at an annual rate of .28% of the fund's average net
assets.
TRANSFER AGENT FEES. Fidelity Investments Institutional Operations Company
(FIIOC), an affiliate of FMR, is the fund's transfer, dividend disbursing
and shareholder servicing agent. During the period March 1, 1994 to
December 31, 1994, FIIOC received fees based on the type, size, number of
accounts and the number of transactions made by shareholders. Effective
January 1, 1995, the Board of Trustees approved a revised transfer agent
contract pursuant to which FIIOC receives account fees and asset-based fees
that vary according to account size and type of account. FIIOC pays for
typesetting, printing and mailing of all shareholder reports, except proxy
statements.
ACCOUNTING AND SECURITY LENDING FEES. Fidelity Service Co. (FSC), an
affiliate of FMR, 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 $1,000 for the period.
11. 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 $718,000 and
$752,000, respectively.
12. 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 periods for
which loans were outstanding amounted to $3,236,000. The weighted average
interest rate was 4.81%.
13. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the fund's operating expenses
(excluding interest, taxes, brokerage commissions and extraordinary
expenses) above an annual rate of .28% of average net assets. For the
period, the reimbursement reduced the expenses by $6,009,000.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Institutional Trust and the Shareholders of
Fidelity U.S. Equity Index Portfolio:
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of investments, and the related statements of
operations and of changes in net assets and the financial highlights
(included on page P-4 of the Prospectus) present fairly, in all material
respects, the financial position of Fidelity U.S. Equity Index Portfolio (a
fund of Fidelity Institutional Trust) at February 28, 1995, the results of
its operations for the year then ended, the changes in its net assets and
the financial highlights for the periods indicated in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Fidelity U.S. Equity Index Portfolio's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe
that our audits, which included confirmation of securities owned at
February 28, 1995 by correspondence with the custodian and brokers and the
application of alternative auditing procedures where confirmations from
brokers, were not received, provide a reasonable basis for the opinion
expressed above.
PRICE WATERHOUSE LLP
Boston, Massachusetts
April 6, 1995
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
William J. Hayes, VICE PRESIDENT
Arthur S. Loring, SECRETARY
Stephen P. Jonas, TREASURER
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
Robert H. Morrison, MANAGER, SECURITY TRANSACTIONS
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox
Phyllis Burke Davis
Richard J. Flynn
Edward C. Johnson 3d
E. Bradley Jones
Donald J. Kirk
Peter S. Lynch
Edward H. Malone
Marvin L. Mann
Gerald C. McDonough
Thomas R. Williams
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND
SHAREHOLDER
SERVICING AGENT
Fidelity Investments Institutional Operations Company
Boston, MA
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
