SUPPLEMENT TO THE SPARTAN(registered trademark) U.S. EQUITY INDEX FUND
APRIL 29, 1997 PROSPECTUS
SHAREHOLDER MEETING. On or about November 19, 1997, a shareholder meeting
will be held to consider the adoption of a sub-advisory agreement with
Bankers Trust Company (BT) and to consider amendments to the fund's
present management contract. If shareholders of record on September 22,
1997 approve the sub-advisory agreement and the amended management
contract, Fidelity Management & Research Company (FMR) would continue to
serve as the fund's manager and investment adviser, but would delegate part
of its duties to BT. As sub-adviser, BT would have day-to-day
responsibility for managing the fund's investments. BT would also provide
custodial and securities lending services to the fund. FMR would be
responsible for overseeing BT's performance and would retain its other
management responsibilities, subject to oversight by the Board of Trustees.
All other fund services, including shareholder account services, would be
unchanged.
The proposed amendments to the fund's management contract with FMR would
amend the contract to allow for the appointment of a sub-adviser to the
fund and to reduce the management fee rate from an annual rate of 0.28% of
the fund's average net assets to an annual rate of 0.24% of the fund's
average net assets. Because FMR is currently limiting the fund's expenses
to a level lower than the management fee, the proposed reduction would not
affect the fund's expenses at present. However, it represents a reduction
in the amount FMR would be entitled to receive for management services if
the expense limit were to increase in the future.
BT is a major institutional money manager and one of the nation's leading
managers of index funds with over 20 years' experience in managing
investments indexed to the S&P 500(registered trademark) and other indices.
BT's commitment to the specialized area of index account management allows
it to provide index fund portfolio management services at a lower cost than
if FMR provided these services itself.
If you wish to receive a proxy statement, please call 1-800-843-3001.
The following information replaces similar information found in "Expenses"
on page P-3:
FMR has voluntarily agreed to reimburse the fund to the extent that total
operating expenses exceed 0.19% of its average net assets. This agreement
will continue through December 31, 1999. If this agreement were not in
effect, the management fee, other expenses, and total operating expenses,
as a percentage of average net assets, would have been 0.28%, 0.27%, and
0.55% for the fund. Expenses eligible for reimbursement do not include
interest, taxes, brokerage commissions, and extraordinary expenses.
