FIDELITY
(REGISTERED TRADEMARK)
FREEDOM
FUNDS - INCOME, 2000, 2010, 2020, 2030
SM
SEMIANNUAL REPORT
SEPTEMBER 30, 1997
CONTENTS
PRESIDENT'S MESSAGE 3 NED JOHNSON ON INVESTING STRATEGIES.
PERFORMANCE 4 HOW THE FUNDS HAVE DONE OVER TIME.
FUND TALK 14 THE MANAGERS' REVIEW OF THE FUNDS'
PERFORMANCE, STRATEGY AND OUTLOOK.
FREEDOM INCOME 18 INVESTMENT CHANGES
20 INVESTMENTS
21 FINANCIAL STATEMENTS
FREEDOM 2000 25 INVESTMENT CHANGES
27 INVESTMENTS
29 FINANCIAL STATEMENTS
FREEDOM 2010 33 INVESTMENT CHANGES
35 INVESTMENTS
37 FINANCIAL STATEMENTS
FREEDOM 2020 41 INVESTMENT CHANGES
43 INVESTMENTS
45 FINANCIAL STATEMENTS
FREEDOM 2030 49 INVESTMENT CHANGES
51 INVESTMENTS
53 FINANCIAL STATEMENTS
NOTES 57 NOTES TO THE FINANCIAL STATEMENTS.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL INFORMATION
OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS
IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-8888 FOR A
FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
To reduce expenses and demonstrate respect for our environment, we
have initiated a project through which we will begin eliminating
duplicate copies of most financial reports and prospectuses to most
households, even if they have more than one account in the fund. If
additional copies of financial reports, prospectuses or historical
account information are needed, please call 1-800-544-6666.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
The stock and bond markets have performed well through the end of
September 1997, despite experiencing some short-term volatility in the
spring and again in August. The Standard & Poor's 500 Index was up
roughly 30% year-to-date through September, almost three times its
historical annual average. The bond markets - primarily influenced by
positive news on the inflation front - have posted moderate returns
through the first nine months of the year.
While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.
First, investors are encouraged to take a long-term view of their
portfolios. If you can afford to leave your money invested through the
inevitable up and down cycles of the financial markets, you will
greatly reduce your vulnerability to any single decline. We know from
experience, for example, that stock prices have gone up over longer
periods of time, have significantly outperformed other types of
investments and have stayed ahead of inflation.
Second, you can further manage your investing risk through
diversification. Freedom Funds are already diversified because they
invest in stock, bond and money market funds with both domestic and
foreign exposures. If you have a short investment time horizon, you
might want to consider moving some of your investment into a money
market fund, which seeks income and a stable share price by investing
in high-quality, short-term investments. Of course, it's important to
remember that there is no assurance that a money market fund will
achieve its goal of maintaining a stable net asset value of $1.00 per
share, and that these types of funds are neither insured nor
guaranteed by any agency of the U.S. government.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are
available 24 hours a day, seven days a week to provide you the
information you need to make the investments that are right for you.
Best regards,
Edward C. Johnson 3d
FIDELITY FREEDOM INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Strategic Advisers had not reimbursed certain
fund expenses, the fund's total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED SEPTEMBER 30, 1997 PAST 6 LIFE OF
MONTHS FUND
FIDELITY FREEDOM INCOME FUND 8.85% 11.02%
LEHMAN BROTHERS AGGREGATE BOND INDEX 7.12% 8.72%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, six months or since the fund
started on October 17, 1996. For example, if you had 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 market
value weighted performance benchmark for investment-grade fixed-rate
debt issues, including government, corporate, asset-backed and
mortgage-backed securities, with maturities of at least one year. This
benchmark includes reinvested dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund
had performed at a constant rate each year. Average annual total
returns will appear once the fund is a year old.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19970930 19971008 144125 S00000000000001
Freedom Income LB Aggregate Bond
FI Freedom Inc. Composite
00369 LB001
F0199
1996/10/31 10000.00 10000.00
10000.00
1996/11/30 10209.37 10171.29
10236.38
1996/12/31 10149.16 10076.71
10175.35
1997/01/31 10280.05 10107.57
10332.62
1997/02/28 10290.08 10132.71
10375.27
1997/03/31 10168.68 10020.43
10262.20
1997/04/30 10330.98 10170.43
10463.96
1997/05/31 10524.49 10266.57
10649.55
1997/06/30 10677.76 10388.43
10813.55
1997/07/31 10985.29 10668.57
11119.32
1997/08/31 10872.09 10577.57
10977.64
1997/09/30 11068.36 10733.57
11180.00
IMATRL PRASUN SHR__CHT 19970930 19971008 144126 R00000000000014
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom Income Fund on October 31, 1996, shortly
after the fund started. As the chart shows, by September 30, 1997, the
value of the investment would have grown to $11,068 - a 10.68%
increase on the initial investment. For comparison, look at how the
Lehman Brothers Aggregate Bond Index did over the same period. With
dividends and capital gains, if any, reinvested, the same $10,000
investment would have grown to $10,734 - a 7.34% increase. You can
also look at how the Fidelity Freedom Income Composite Index, a
hypothetical combination of unmanaged indices, did over the same
period. The composite index combines the total returns of the S&P 500
(+36.68%), the Lehman Brothers Aggregate Bond Index (+7.34%), and the
Salomon Brothers 3-month T-Bill Total Rate of Return Index (+4.78%)
according to the composite benchmark weightings.* With dividends and
capital gains, if any, reinvested, the same $10,000 investment would
have grown to $11,180 - an 11.80% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. 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)
* CURRENTLY 19.7% DOMESTIC EQUITY, 40.3% INVESTMENT-GRADE
FIXED-INCOME, AND 40.0% MONEY MARKET;
20.0%, 40.0%, AND 40.0%, RESPECTIVELY, PRIOR TO JUNE 30, 1997.
FIDELITY FREEDOM 2000 FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Strategic Advisers had not reimbursed certain
fund expenses, the fund's total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED SEPTEMBER 30, 1997 PAST 6 LIFE OF
MONTHS FUND
FIDELITY FREEDOM 2000 FUND 14.30% 16.69%
LEHMAN BROTHERS AGGREGATE BOND INDEX 7.12% 8.72%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, six months or since the fund
started on October 17, 1996. For example, if you had 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 market
value weighted performance benchmark for investment-grade fixed-rate
debt issues, including government, corporate, asset-backed and
mortgage-backed securities, with maturities of at least one year. This
benchmark includes reinvested dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the
fund had performed at a constant rate each year. Average annual total
returns will appear once the fund is a year old.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19970930 19971015 115854 S00000000000001
Freedom 2000 LB Aggregate Bond
FI Freedom 2000 Composite
00370 LB001
F0200
1996/10/31 10000.00 10000.00
10000.00
1996/11/30 10340.00 10171.29
10396.68
1996/12/31 10239.47 10076.71
10278.85
1997/01/31 10441.23 10107.57
10536.14
1997/02/28 10451.32 10132.71
10597.63
1997/03/31 10209.21 10020.43
10381.24
1997/04/30 10451.32 10170.43
10700.25
1997/05/31 10806.18 10266.57
11041.95
1997/06/30 11070.24 10388.43
11328.54
1997/07/31 11578.05 10668.57
11822.95
1997/08/31 11313.99 10577.57
11494.81
1997/09/30 11669.45 10733.57
11847.42
IMATRL PRASUN SHR__CHT 19970930 19971015 115857 R00000000000014
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2000 Fund on October 31, 1996, shortly
after the fund started. As the chart shows, by September 30, 1997, the
value of the investment would have grown to $11,669 - a 16.69%
increase on the initial investment. For comparison, look at how the
Lehman Brothers Aggregate Bond Index did over the same period. With
dividends and capital gains, if any, reinvested, the same $10,000
investment would have grown to $10,734 - a 7.34% increase. You can
also look at how the Fidelity Freedom 2000 Composite Index, a
hypothetical combination of unmanaged indices, did over the same
period. The composite index combines the total returns of the S&P 500
(+36.68%), the Morgan Stanley Capital International Europe,
Australasia and Far East (EAFE) Index (+13.52%), the Lehman Brothers
Aggregate Bond Index (+7.34%), the Merrill Lynch High Yield Master
Index (+13.07%), and the Salomon Brothers 3-month T-Bill Total Rate of
Return Index (+4.78%), according to the composite benchmark
weightings.* With dividends and capital gains, if any, reinvested, the
same $10,000 investment would have grown to $11,847 - an 18.47%
increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. 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)
* CURRENTLY 38.2% DOMESTIC EQUITY, 4.5% INTERNATIONAL EQUITY, 40.8%
INVESTMENT GRADE FIXED-INCOME, 4.0% HIGH YIELD FIXED-INCOME, AND 12.5%
MONEY MARKET; 39.2%, 4.4%, 40.9%, 4.0%, AND 11.5%, RESPECTIVELY, PRIOR
TO JUNE 30, 1997.
FIDELITY FREEDOM 2010 FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Strategic Advisers had not reimbursed certain
fund expenses, the fund's total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED SEPTEMBER 30, 1997 PAST 6 LIFE OF
MONTHS FUND
FIDELITY FREEDOM 2010 FUND 19.58% 22.67%
S&P 500(REGISTERED TRADEMARK) 26.26% 36.94%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, six months or since the fund
started on October 17, 1996. For example, if you had 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 Standard & Poor's 500 Index - a widely recognized,
unmanaged index of common stocks. This benchmark includes reinvested
dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund
had performed at a constant rate each year. Average annual total
returns will appear once the fund is a year old.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19970930 19971015 115943 S00000000000001
Freedom 2010 S&P 500
FI Freedom 2010 Composite
00371 SP001
F0201
1996/10/31 10000.00 10000.00
10000.00
1996/11/30 10471.89 10755.90
10541.45
1996/12/31 10340.61 10542.83
10386.72
1997/01/31 10634.90 11201.54
10749.20
1997/02/28 10645.05 11289.36
10833.43
1997/03/31 10300.02 10825.48
10536.49
1997/04/30 10624.75 11471.76
10960.98
1997/05/31 11144.12 12170.16
11465.97
1997/06/30 11521.36 12715.39
11876.68
1997/07/31 12214.69 13727.15
12541.14
1997/08/31 11796.65 12958.16
12019.12
1997/09/30 12316.64 13667.87
12522.04
IMATRL PRASUN SHR__CHT 19970930 19971015 115946 R00000000000014
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2010 Fund on October 31, 1996, shortly
after the fund started. As the chart shows, by September 30, 1997, the
value of the investment would have grown to $12,317 - a 23.17%
increase on the initial investment. For comparison, look at how the
S&P 500 did over the same period. With dividends and capital gains, if
any, reinvested, the same $10,000 investment would have grown to
$13,668 - a 36.68% increase. You can also look at how the Fidelity
Freedom 2010 Composite Index, a hypothetical combination of unmanaged
indices, did over the same period. The composite index combines the
total returns of the S&P 500 (+36.68%), the Morgan Stanley Capital
International Europe, Australasia and Far East (EAFE) Index (+13.52%),
the Lehman Brothers Aggregate Bond Index (+7.34%), and the Merrill
Lynch High Yield Master Index (+13.07%), according to the composite
benchmark weightings.* With dividends and capital gains, if any,
reinvested, the same $10,000 investment would have grown to $12,522 -
a 25.22% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. 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)
* CURRENTLY 57.7% DOMESTIC EQUITY, 9.5% INTERNATIONAL EQUITY, 25.0%
INVESTMENT GRADE FIXED-INCOME, 7.1% HIGH YIELD FIXED-INCOME, AND 0.7%
MONEY MARKET; 59.2%, 9.7%, 24.1%, 7.0%, AND 0.0%, RESPECTIVELY, PRIOR
TO JUNE 30, 1997.
FIDELITY FREEDOM 2020 FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Strategic Advisers had not reimbursed certain
fund expenses, the fund's total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED SEPTEMBER 30, 1997 PAST 6 LIFE OF
MONTHS FUND
FIDELITY FREEDOM 2020 FUND 22.02% 25.67%
S&P 500(REGISTERED TRADEMARK) 26.26% 36.94%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, six months or since the fund
started on October 17, 1996. For example, if you had 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 Standard & Poor's 500 Index - a widely recognized,
unmanaged index of common stocks. This benchmark includes reinvested
dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund
had performed at a constant rate each year. Average annual total
returns will appear once the fund is a year old.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19970930 19971015 120201 S00000000000001
Freedom 2020 S&P 500
FI Freedom 2020 Composite
00372 SP001
F0202
1996/10/31 10000.00 10000.00
10000.00
1996/11/30 10523.14 10755.90
10610.90
1996/12/31 10391.74 10542.83
10442.99
1997/01/31 10726.63 11201.54
10863.95
1997/02/28 10736.78 11289.36
10960.11
1997/03/31 10361.29 10825.48
10628.61
1997/04/30 10716.48 11471.76
11105.20
1997/05/31 11317.32 12170.16
11695.78
1997/06/30 11755.74 12715.39
12170.18
1997/07/31 12530.62 13727.15
12921.71
1997/08/31 12031.02 12958.16
12286.67
1997/09/30 12642.77 13667.87
12873.55
IMATRL PRASUN SHR__CHT 19970930 19971015 120202 R00000000000014
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2020 Fund on October 31, 1996, shortly
after the fund started. As the chart shows, by September 30, 1997, the
value of the investment would have grown to $12,643 - a 26.43%
increase on the initial investment. For comparison, look at how the
S&P 500 did over the same period. With dividends and capital gains, if
any, reinvested, the same $10,000 investment would have grown to
$13,668 - a 36.68% increase. You can also look at how the Fidelity
Freedom 2020 Composite Index, a hypothetical combination of unmanaged
indices, did over the same period. The composite index combines the
total returns of the S&P 500 (+36.68%), the Morgan Stanley Capital
International Europe, Australasia and Far East (EAFE) Index (+13.52%),
the Lehman Brothers Aggregate Bond Index (+7.34%), and the Merrill
Lynch High Yield Master Index (+13.07%) according to the composite
benchmark weightings.* With dividends and capital gains, if any,
reinvested, the same $10,000 investment would have grown to $12,874 -
a 28.74% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. 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)
* CURRENTLY 69.1% DOMESTIC EQUITY, 12.6% INTERNATIONAL EQUITY, 10.7%
INVESTMENT GRADE FIXED-INCOME, AND 7.6% HIGH YIELD FIXED-INCOME, 70.0%
12.4%, 10.1% AND 7.5%, RESPECTIVELY, PRIOR TO JUNE 30, 1997.
FIDELITY FREEDOM 2030 FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Strategic Advisers had not reimbursed certain
fund expenses, the fund's total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED SEPTEMBER 30, 1997 PAST 6 LIFE OF
MONTHS FUND
FIDELITY FREEDOM 2030 FUND 22.67% 26.34%
S&P 500(REGISTERED TRADEMARK) 26.26% 36.94%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, six months or since the fund
started on October 17, 1996. For example, if you had 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 Standard & Poor's 500 Index - a widely recognized,
unmanaged index of common stocks. This benchmark includes reinvested
dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund
had performed at a constant rate each year. Average annual total
returns will appear once the fund is a year old.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19970930 19971008 143743 S00000000000001
Freedom 2030 S&P 500
FI Freedom 2030 Composite
00373 SP001
F0203
1996/10/31 10000.00 10000.00
10000.00
1996/11/30 10533.74 10755.90
10617.58
1996/12/31 10402.20 10542.83
10453.09
1997/01/31 10737.43 11201.54
10865.36
1997/02/28 10757.75 11289.36
10968.64
1997/03/31 10371.73 10825.48
10641.13
1997/04/30 10727.27 11471.76
11114.69
1997/05/31 11368.59 12170.16
11724.85
1997/06/30 11816.82 12715.39
12214.63
1997/07/31 12601.21 13727.15
12967.98
1997/08/31 12081.68 12958.16
12308.27
1997/09/30 12723.45 13667.87
12911.89
IMATRL PRASUN SHR__CHT 19970930 19971008 143744 R00000000000014
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2030 Fund on October 31, 1996, shortly
after the fund started. As the chart shows, by September 30, 1997, the
value of the investment would have grown to $12,723 - a 27.23%
increase on the initial investment. For comparison, look at how the
S&P 500 did over the same period. With dividends and capital gains, if
any, reinvested, the same $10,000 investment would have grown to
$13,668 - a 36.68% increase. You can also look at how the Fidelity
Freedom 2030 Composite Index, a hypothetical combination of unmanaged
indices, did over the same period. The composite index combines the
total returns of the S&P 500 (+36.68%), the Morgan Stanley Capital
International Europe, Australasia and Far East (EAFE) Index (+13.52%),
the Lehman Brothers Aggregate Bond Index (+7.34%), and the Merrill
Lynch High Yield Master Index (+13.07%) according to the composite
benchmark weightings.* With dividends and capital gains, if any,
reinvested, the same $10,000 investment would have grown to $12,912 -
a 29.12% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. 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)
* CURRENTLY 69.6% DOMESTIC EQUITY, 15.1% INTERNATIONAL EQUITY, 5.3%
INVESTMENT GRADE FIXED-INCOME, AND 10.0% HIGH YIELD FIXED-INCOME;
70.0% 15.0%, 5.0% AND 10.0%, RESPECTIVELY, PRIOR TO JUNE 30, 1997.
FUND TALK: THE MANAGERS' OVERVIEW
An interview with Ren Cheng (right photo), with additional comments
from Scott Stewart, Portfolio Managers of the Fidelity Freedom Funds
Q. HOW DID THE FUNDS PERFORM, REN?
A. I'm pleased with the funds' performance. For the six months that
ended September 30, 1997, the Income, 2000 and 2010 portfolios
returned 8.85%, 14.30% and 19.58%, respectively. The 2020 and 2030
portfolios returned 22.02% and 22.67%, respectively, over the same
period. The Lehman Brothers Aggregate Bond Index and Standard & Poor's
500 Index returned 7.12% and 26.26%, respectively, for the same
period. From October 17, 1996 - the date of the funds' commencement -
through September 30, 1997, the Income, 2000 and 2010 portfolios
returned 11.02%, 16.69% and 22.67%, respectively. The 2020 and 2030
portfolios returned 25.67% and 26.34%, respectively, in that same
time, while the Lehman Brothers Aggregate Bond Index and S&P 500
returned 8.72% and 36.94%, respectively. While the funds compare to
these broad stock and bond market indexes, they also compare their
performance to that of their composite benchmarks. The funds'
benchmarks are comprised of various indexes and reflect the funds'
target allocation mixes. Over the past six months, the Income
portfolio matched the return of its benchmark, while the 2000, 2010
and 2020 portfolios topped theirs. The 2030 portfolio trailed its
benchmark by a slight margin.
Q. WHAT MARKET OR ECONOMIC FACTORS PLAYED KEY ROLES IN THE FUNDS'
PERFORMANCE?
A. On the equity side, we saw an overall broadening of the stock
market. That is, while an exclusive club of well-known,
large-capitalization stocks had dominated the market for an extended
period of time, small- and mid-cap stocks staged a furious comeback in
the latter months of the summer. Since many of the underlying equity
funds in the portfolios have a small- to mid-cap bias, this turnaround
resulted in positive gains for the Freedom Funds. On the fixed-income
side, the backdrop proved to be relatively stable, as consistent yet
moderate economic growth and subdued inflation translated into a
narrow trading range for interest rates. This steady climate was
favorable to both the bond and stock markets.
Q. WHICH SEGMENTS OF THE STOCK MARKET CONTRIBUTED THE MOST TO THE
FUNDS' PERFORMANCE? WHICH PROVED TO BE DETRACTORS?
A. Strong global demand for increased communications capacity and
personal computing made technology stocks particularly attractive. The
Internet has played a significant role here, with online traffic
doubling every two months or so. That's a pretty powerful story that
shows no sign of letting up. The Fidelity OTC Portfolio, an underlying
fund that typically invests heavily in technology-related stocks,
benefited from these trends as it returned 35.16% during the period.
Two other areas that influenced several underlying funds were
homebuilding-related stocks and alcohol and tobacco goods. New housing
starts were healthy during the period, and consumers displayed no
reluctance spending money on their new homes or revamping their
existing homes. As far as negatives, companies that produce alcohol
and tobacco goods struggled during the period, the latter due
primarily to the ongoing tobacco litigation process.
Q. HOW ABOUT THE INTERNATIONAL MARKETS?
A. The major theme overseas was changes in the relative value of
currencies, especially in Europe and Southeast Asia. In Europe, the
dollar lost ground to the Deutsche mark toward the end of the period
as rumors of rising interest rates in Germany and promising prospects
for the European Monetary Union figured prominently. This helped
several of the funds' underlying investments, including Fidelity
Europe Fund, Fidelity Diversified International Fund and Fidelity
Overseas Fund. Southeast Asia, however, where the Freedom Funds had
minor exposure, was an entirely different situation. The currencies of
Thailand and Malaysia - the baht and ringgit, respectively -
depreciated dramatically as the region's ambitious development plans
wavered due to both fiscal and monetary pressure. The rapid growth
rate in Southeast Asia has given rise to the need to import large
amounts of foreign capital. Unfortunately, this imbalance finally
caught up with the region.
Q. THE FUNDS' ASSETS HAVE NEARLY QUADRUPLED OVER THE PAST SIX MONTHS -
FROM AROUND $69 MILLION TO APPROXIMATELY $272 MILLION. DID THIS AFFECT
YOUR MANAGEMENT STYLE IN ANY WAY?
A. Not at all. When large amounts of money come into a diversified
stock fund, the manager occasionally can encounter difficulty putting
that new money right to work. He or she will want to wait for the
right investing opportunities. With the Freedom Funds, the money that
comes in is automatically allocated according to the funds' target
mixes.
Q. WHAT TYPES OF STRATEGIES DO YOU EMPLOY IN MANAGING A "FUND OF
FUNDS" PRODUCT LIKE THE FREEDOM FUNDS?
A. My main emphasis is on the funds' target allocation mixes and
determining how fast, when, and by how much to reduce certain
exposures. Though I don't change the Freedom Funds' investments on a
daily basis, I'm still actively monitoring the underlying funds. If I
detect a stock or bond bias of any kind with the underlying
investments, or if an underlying fund has undergone some type of
investment-policy change that may affect the Freedom Funds, then I may
consider making changes. Thus far, though, the Freedom Funds have
performed pretty much as we had hoped from a risk/return perspective.
Q. REN, WHAT SORTS OF CHANGES DO YOU ENVISION GOING FORWARD?
A. In keeping with the funds' long-term strategy, I'll gradually
reallocate each Freedom Fund's target investment mix over the coming
months. The table below illustrates the target asset mix I'd like to
achieve for each fund by the next time we address our shareholders on
March 31, 1998:
INCOME 2000 2010 2020 2030
DOMESTIC EQUITY FUNDS 20.0% 37.4% 56.0% 68.3% 70.0%
INTERNATIONAL EQUITY FUNDS - 4.1% 8.7% 12.1% 14.6%
INV. GRADE FIXED-INCOME FUNDS 40.0% 40.2% 26.5% 12.1% 5.8%
HIGH YIELD FIXED-INCOME FUNDS - 3.7% 6.8% 7.5% 9.6%
MONEY MARKET FUNDS 40.0% 14.6% 2.0% - -
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGERS ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGERS' VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.
REFLECTING THE CHANGES TO THE TARGET INVESTMENT MIXES DESCRIBED ABOVE,
EACH FUND'S COMPOSITE BENCHMARK WILL CHANGE ITS ALLOCATION AS OF
DECEMBER 31, 1997. THE TABLE BELOW ILLUSTRATES THESE CHANGES.
COMPOSITE BENCHMARKS
INCOME 2000 2010 2020 2030
DOMESTIC EQUITY 19.9% 37.9% 56.8% 68.6% 69.6%
INTERNATIONAL EQUITY - 4.3% 9.2% 12.4% 15.0%
INV. GRADE FIXED-INCOME 40.1% 40.5% 25.7% 11.4% 5.5%
HIGH YIELD FIXED-INCOME - 3.9% 7.0% 7.6% 9.9%
MONEY MARKET 40.0% 13.4% 1.3% - -
SCOTT STEWART DISCUSSES THE
BENEFITS OF "AUTOMATIC"
DIVERSIFICATION:
"No matter what your investment
goals, diversification - or being
invested across a number of different
asset types - can play a key part in
helping you achieve them. When you
invest in the Freedom Funds, your
money is automatically distributed
among a range of Fidelity stock,
bond and money market funds. The
distribution varies depending on
your time horizon and the specific
Freedom Fund(s) you choose.
"The developments that Ren just
discussed illustrate how effective
this feature can be. The 2030 and
2020 portfolios, for example, have
nearly equal exposures to a group of
underlying stock funds with different
investment disciplines. For instance,
Fidelity Growth Company Fund has a
smaller- to mid-cap bias while Fidelity
Blue Chip Growth Fund favors
larger-cap stocks. Thus, when
smaller stocks outperformed larger
stocks at the tail end of the period,
the Freedom Funds were able to
participate to some extent.
"The same holds true for the
underlying bond funds. Fidelity
Government Securities Fund and
Fidelity Intermediate Bond Fund
invest in securities with
short-to-medium average maturities,
while Fidelity Investment Grade
Bond Fund invests in bonds with
longer maturities. These underlying
funds give us exposure to
government bonds, mortgage-backed
securities and corporate bonds.
"Having exposure to different
markets doesn't guarantee against
poor performance, but it does give
investors an opportunity to offset a
decline in any one particular
market segment."
FUND FACTS
GOAL: the Income fund seeks
high current income and, as a
secondary objective, capital
appreciation. The 2000, 2010,
2020 and 2030 funds each
seek high total return. Each
fund seeks to achieve its goal
by investing in a combination
of equity, fixed-income, and
money market underlying
Fidelity funds
FUND NUMBERS: Income (369);
2000 (370); 2010 (371);
2020 (372); 2030 (373)
SIZE: as of September 30, 1997,
more than $21.3 million (Income);
$63.4 million (2000); $90.0
million (2010); $61.5 million
(2020); $36.1 million (2030)
MANAGERS: Ren Cheng, since
inception; manager, various
structured investments for
Fidelity Management Trust
Company; joined Fidelity in
1994; Scott Stewart, since
inception; manager, Fidelity
Fifty, since 1993; founder and
head of Fidelity's Structured
Equity Group since 1987;
joined Fidelity in 1987
(checkmark)
FIDELITY FREEDOM INCOME FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF SEPTEMBER 30, 1997
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS IN THESE HOLDINGS
6 MONTHS AGO
DOMESTIC EQUITY FUNDS
BLUE CHIP GROWTH FUND 3.0% 2.9%
DISCIPLINED EQUITY FUND 2.9 2.9
EQUITY-INCOME FUND 3.0 3.0
FIDELITY FUND 3.0 2.9
GROWTH & INCOME PORTFOLIO 3.0 3.0
GROWTH COMPANY FUND 2.9 2.9
OTC PORTFOLIO 2.0 1.8
19.8 19.4
INVESTMENT GRADE FIXED-INCOME FUNDS
GOVERNMENT SECURITIES FUND 15.2 15.0
INTERMEDIATE BOND FUND 9.9 9.9
INVESTMENT GRADE BOND FUND 15.2 15.1
40.3 40.0
MONEY MARKET FUND
FIDELITY MONEY MARKET TRUST: RETIREMENT 39.9 40.6
MONEY MARKET PORTFOLIO
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
ROW: 1, COL: 1, VALUE: 40.6
ROW: 1, COL: 2, VALUE: 40.0
ROW: 1, COL: 3, VALUE: 19.4
19.4%
40.6%
40.0%
CURRENT
ROW: 1, COL: 1, VALUE: 39.9
ROW: 1, COL: 2, VALUE: 40.3
ROW: 1, COL: 3, VALUE: 19.8
19.8%
39.9%
40.3%
DOMESTIC EQUITY FUNDS
EXPECTED
INVESTMENT GRADE FIXED-INCOME FUNDS
ROW: 1, COL: 1, VALUE: 40.0
ROW: 1, COL: 2, VALUE: 40.0
ROW: 1, COL: 3, VALUE: 20.0
20.0%
MONEY MARKET FUND
40.0%
40.0%
THE SIX MONTHS AGO ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF
MARCH 31, 1997. THE CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS
AS OF SEPTEMBER 30, 1997. THE EXPECTED ALLOCATION REPRESENTS THE
FUND'S ANTICIPATED TARGET ASSET ALLOCATION AT MARCH 31, 1998.
FIDELITY FREEDOM INCOME FUND
INVESTMENTS SEPTEMBER 30, 1997 (UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
EQUITY FUNDS - 19.8%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 19.8%
Blue Chip Growth Fund 15,926 $ 633,687
Disciplined Equity Fund 22,029 632,676
Equity-Income Fund 12,079 640,651
Fidelity Fund 21,074 636,230
Growth & Income Portfolio 17,132 636,626
Growth Company Fund 12,703 632,758
OTC Portfolio 10,783 423,890
TOTAL EQUITY FUNDS
(Cost $3,877,541) 4,236,518
FIXED-INCOME FUNDS - 40.3%
INVESTMENT GRADE FIXED-INCOME FUNDS - 40.3%
Government Securities Fund 333,297 3,252,974
Intermediate Bond Fund 210,284 2,128,078
Investment Grade Bond Fund 451,684 3,252,125
TOTAL FIXED-INCOME FUNDS
(Cost $8,554,462) 8,633,177
MONEY MARKET FUND - 39.9%
Fidelity Money Market Trust: Retirement
Money Market Portfolio
(Cost $8,531,136) 8,531,136 8,531,136
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $20,963,139) $ 21,400,831
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$14,836,650 and $3,628,599, respectively.
INCOME TAX INFORMATION
At September 30, 1997, the aggregate cost of investment securities for
income tax purposes was $20,963,448. Net unrealized appreciation
aggregated $437,383, of which $442,742 related to appreciated
investment securities and $5,359 related to depreciated investment
securities.
FIDELITY FREEDOM INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1997 (UNAUDITED)
ASSETS
INVESTMENT IN SECURITIES, AT VALUE (COST $ 21,400,831
$20,963,139) -
SEE ACCOMPANYING SCHEDULE
RECEIVABLE FOR FREEDOM FUND SHARES SOLD 238,840
DIVIDENDS RECEIVABLE 74,761
TOTAL ASSETS 21,714,432
LIABILITIES
PAYABLE TO CUSTODIAN BANK $ 180
PAYABLE FOR UNDERLYING FUND SHARES 295,455
PURCHASED
PAYABLE FOR FREEDOM FUND SHARES 18,623
REDEEMED
ACCRUED MANAGEMENT FEE 1,294
TOTAL LIABILITIES 315,552
NET ASSETS $ 21,398,880
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 20,663,182
UNDISTRIBUTED NET INVESTMENT INCOME 77,388
ACCUMULATED UNDISTRIBUTED NET REALIZED 220,618
GAIN (LOSS)
ON INVESTMENTS
NET UNREALIZED APPRECIATION (DEPRECIATION) 437,692
ON INVESTMENTS
NET ASSETS, FOR 1,999,572 SHARES $ 21,398,880
OUTSTANDING
NET ASSET VALUE, OFFERING PRICE AND $10.70
REDEMPTION PRICE
PER SHARE ($21,398,880 (DIVIDED BY) 1,999,572
SHARES)
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1997 (UNAUDITED)
INVESTMENT INCOME $ 347,284
INCOME DISTRIBUTIONS FROM UNDERLYING FUNDS
INTEREST 54
TOTAL INCOME 347,338
EXPENSES
MANAGEMENT FEE $ 7,128
NON-INTERESTED TRUSTEES' COMPENSATION 30
TOTAL EXPENSES BEFORE REDUCTIONS 7,158
EXPENSE REDUCTIONS (1,489) 5,669
NET INVESTMENT INCOME 341,669
REALIZED AND UNREALIZED GAIN (LOSS)
CAPITAL GAIN DISTRIBUTIONS FROM UNDERLYING 56,251
FUNDS
REALIZED GAIN (LOSS) ON SALE OF UNDERLYING 168,615 224,866
FUND SHARES
CHANGE IN NET UNREALIZED APPRECIATION 598,492
(DEPRECIATION)
ON INVESTMENT SECURITIES
NET GAIN (LOSS) 823,358
NET INCREASE (DECREASE) IN NET ASSETS $ 1,165,027
RESULTING
FROM OPERATIONS
OTHER INFORMATION $ 1,456
EXPENSE REDUCTIONS
REIMBURSEMENT FROM INVESTMENT ADVISER
CUSTODIAN INTEREST CREDITS 33
$ 1,489
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
(UNAUDITED) OF OPERATIONS) TO
MARCH 31,
1997
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS $ 341,669 $ 73,301
NET INVESTMENT INCOME
NET REALIZED GAIN (LOSS) 224,866 12,977
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 598,492 (160,800)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 1,165,027 (74,522)
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (305,282) (33,604)
FROM NET INVESTMENT INCOME
FROM NET REALIZED GAIN (10,751) -
TOTAL DISTRIBUTIONS (316,033) (33,604)
SHARE TRANSACTIONS 17,617,463 11,258,281
NET PROCEEDS FROM SALES OF FREEDOM FUND SHARES
REINVESTMENT OF DISTRIBUTIONS 312,365 33,565
COST OF FREEDOM FUND SHARES REDEEMED (6,806,477) (1,757,185)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 11,123,351 9,534,661
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 11,972,345 9,426,535
NET ASSETS
BEGINNING OF PERIOD 9,426,535 -
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT $ 21,398,880 $ 9,426,535
INCOME OF $77,388 AND $41,001, RESPECTIVELY)
OTHER INFORMATION
SHARES
SOLD 1,682,403 1,105,915
ISSUED IN REINVESTMENT OF DISTRIBUTIONS 29,999 3,290
REDEEMED (649,603) (172,432)
NET INCREASE (DECREASE) 1,062,799 936,773
</TABLE>
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
OF OPERATIONS) TO
MARCH 31,
(UNAUDITED) 1997
<TABLE>
<CAPTION>
<S> <C> <C>
SELECTED PER-SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.06 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
NET INVESTMENT INCOME D .25 .22
NET REALIZED AND UNREALIZED GAIN (LOSS) .63 (.02) F
TOTAL FROM INVESTMENT OPERATIONS .88 .20
LESS DISTRIBUTIONS
FROM NET INVESTMENT INCOME (.23) (.14)
FROM NET REALIZED GAIN (.01) -
TOTAL DISTRIBUTIONS (.24) (.14)
NET ASSET VALUE, END OF PERIOD $ 10.70 $ 10.06
TOTAL RETURN B, C 8.85% 1.99%
RATIOS AND SUPPLEMENTAL DATA
(AMOUNTS DO NOT INCLUDE THE ACTIVITY OF THE UNDERLYING FUNDS)
NET ASSETS, END OF PERIOD (000 OMITTED) $ 21,399 $ 9,427
RATIO OF EXPENSES TO AVERAGE NET ASSETS .08% A, E .08% A,
E
RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 4.78% A 4.95% A
PORTFOLIO TURNOVER RATE 51% A 32% A
</TABLE>
ANNUALIZED
TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
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).
NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
STRATEGIC ADVISERS AGREED TO REIMBURSE A PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S
EXPENSE RATIO WOULD HAVE BEEN HIGHER (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET LOSS ON INVESTMENTS FOR THE PERIOD DUE TO THE TIMING OF
SALES AND REPURCHASES OF FUND SHARES IN RELATION TO FLUCTUATING MARKET
VALUES OF THE INVESTMENTS OF THE FUND.
FIDELITY FREEDOM 2000 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF SEPTEMBER 30, 1997
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS IN THESE HOLDINGS
6 MONTHS AGO
DOMESTIC EQUITY FUNDS
BLUE CHIP GROWTH FUND 5.7% 5.8%
DISCIPLINED EQUITY FUND 5.7 5.8
EQUITY-INCOME FUND 5.8 5.9
FIDELITY FUND 5.8 5.8
GROWTH & INCOME PORTFOLIO 5.8 5.8
GROWTH COMPANY FUND 5.7 5.6
OTC PORTFOLIO 3.8 3.6
38.3 38.3
INTERNATIONAL EQUITY FUNDS
DIVERSIFIED INTERNATIONAL FUND 1.2 1.1
EUROPE FUND 1.2 1.2
JAPAN FUND 0.9 0.9
OVERSEAS FUND 1.1 1.2
SOUTHEAST ASIA FUND 0.2 0.2
4.6 4.6
INVESTMENT GRADE FIXED-INCOME FUNDS
GOVERNMENT SECURITIES FUND 15.4 15.5
INTERMEDIATE BOND FUND 10.0 10.2
INVESTMENT GRADE BOND FUND 15.3 15.6
40.7 41.3
HIGH YIELD FIXED-INCOME FUND
CAPITAL & INCOME FUND 4.1 4.0
MONEY MARKET FUND
FIDELITY MONEY MARKET TRUST: RETIREMENT 12.3 11.8
MONEY MARKET PORTFOLIO
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
11.8% (MM)
ROW: 1, COL: 1, VALUE: 11.8
ROW: 1, COL: 2, VALUE: 4.0
ROW: 1, COL: 3, VALUE: 41.3
ROW: 1, COL: 4, VALUE: 4.6
ROW: 1, COL: 5, VALUE: 38.3
4.0% (HY)
38.3% (DE)
41.3% (IG)
4.6% (IE)
CURRENT
12.3% (MM)
ROW: 1, COL: 1, VALUE: 12.3
ROW: 1, COL: 2, VALUE: 4.1
ROW: 1, COL: 3, VALUE: 40.7
ROW: 1, COL: 4, VALUE: 4.6
ROW: 1, COL: 5, VALUE: 38.3
38.3% (DE)
4.1% (HY)
40.7% (IG)
4.6% (IE)
EQUITY
DE = DOMESTIC EQUITY FUNDS
IE = INTERNATIONAL EQUITY FUNDS
EXPECTED
FIXED-INCOME
IG = INVESTMENT GRADE FUNDS
HY = HIGH YIELD FUND
14.6% (MM)
ROW: 1, COL: 1, VALUE: 14.6
ROW: 1, COL: 2, VALUE: 3.7
ROW: 1, COL: 3, VALUE: 40.2
ROW: 1, COL: 4, VALUE: 4.1
ROW: 1, COL: 5, VALUE: 37.4
3.7% (HY)
37.4% (DE)
MONEY MARKET FUND (MM)
40.2% (IG)
4.1% (IE)
THE FUND INVESTS ACCORDING TO AN ASSET ALLOCATION STRATEGY THAT
BECOMES INCREASINGLY CONSERVATIVE OVER TIME. THE SIX MONTHS AGO
ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31, 1997. THE
CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF SEPTEMBER 30,
1997. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT MARCH 31, 1998.
FIDELITY FREEDOM 2000 FUND
INVESTMENTS SEPTEMBER 30, 1997 (UNAUDIT
ED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
EQUITY FUNDS - 42.9%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 38.3%
Blue Chip Growth Fund 91,257 $ 3,631,125
Disciplined Equity Fund 126,417 3,630,698
Equity-Income Fund 69,166 3,668,547
Fidelity Fund 120,726 3,644,714
Growth & Income Portfolio 98,156 3,647,485
Growth Company Fund 72,905 3,631,383
OTC Portfolio 61,834 2,430,696
24,284,648
INTERNATIONAL EQUITY FUNDS - 4.6%
Diversified International Fund 42,032 734,720
Europe Fund 22,808 739,213
Japan Fund 48,529 585,265
Overseas Fund 19,993 733,540
Southeast Asia Fund 10,647 136,926
2,929,664
TOTAL EQUITY FUNDS
(Cost $25,295,252) 27,214,312
FIXED-INCOME FUNDS - 44.8%
INVESTMENT GRADE FIXED-INCOME FUNDS - 40.7%
Government Securities Fund 998,111 9,741,568
Intermediate Bond Fund 629,202 6,367,528
Investment Grade Bond Fund 1,352,456 9,737,680
25,846,776
HIGH YIELD FIXED-INCOME FUNDS - 4.1%
Capital & Income Fund 256,057 2,586,179
TOTAL FIXED-INCOME FUNDS
(Cost $28,072,629) 28,432,955
MONEY MARKET FUND - 12.3%
Fidelity Money Market Trust: Retirement
Money Market Portfolio
(Cost $7,835,388) 7,835,388 7,835,388
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $61,203,269) $ 63,482,655
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$49,560,429 and $5,152,107, respectively.
INCOME TAX INFORMATION
At September 30, 1997, the aggregate cost of investment securities for
income tax purposes was $61,203,746. Net unrealized appreciation
aggregated $2,278,909, of which $2,355,315 related to appreciated
investment securities and $76,406 related to depreciated investment
securities.
FIDELITY FREEDOM 2000 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS
INVESTMENT IN SECURITIES, AT VALUE (COST $61,203,269) - $ 63,482,655
SEE ACCOMPANYING SCHEDULE
CASH 8,445
RECEIVABLE FOR FREEDOM FUND SHARES SOLD 421,133
DIVIDENDS RECEIVABLE 167,539
TOTAL ASSETS 64,079,772
LIABILITIES
PAYABLE FOR UNDERLYING FUND SHARES PURCHASED $ 584,088
PAYABLE FOR FREEDOM FUND SHARES REDEEMED 11,783
ACCRUED MANAGEMENT FEE 4,373
TOTAL LIABILITIES 600,244
NET ASSETS $ 63,479,528
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 59,731,115
UNDISTRIBUTED NET INVESTMENT INCOME 676,659
ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) 792,368
ON INVESTMENTS
NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 2,279,386
NET ASSETS, FOR 5,523,241 SHARES OUTSTANDING $ 63,479,528
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE $11.49
PER SHARE ($63,479,528 (DIVIDED BY) 5,523,241 SHARES)
</TABLE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME $ 690,367
INCOME DISTRIBUTIONS FROM UNDERLYING FUNDS
INTEREST 260
TOTAL INCOME 690,627
EXPENSES
MANAGEMENT FEE $ 17,644
NON-INTERESTED TRUSTEES' COMPENSATION 64
TOTAL EXPENSES BEFORE REDUCTIONS 17,708
EXPENSE REDUCTIONS (3,740) 13,968
NET INVESTMENT INCOME 676,659
REALIZED AND UNREALIZED GAIN (LOSS)
CAPITAL GAIN DISTRIBUTIONS FROM UNDERLYING FUNDS 327,137
REALIZED GAIN (LOSS) ON SALE OF UNDERLYING FUND SHARES 472,818 799,955
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 2,656,893
ON INVESTMENT SECURITIES
NET GAIN (LOSS) 3,456,848
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 4,133,507
FROM OPERATIONS
OTHER INFORMATION $ 3,660
EXPENSE REDUCTIONS
REIMBURSEMENT FROM INVESTMENT ADVISER
CUSTODIAN INTEREST CREDITS 80
$ 3,740
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
(UNAUDITED) OF OPERATIONS) TO
MARCH 31,
1997
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS $ 676,659 $ 108,956
NET INVESTMENT INCOME
NET REALIZED GAIN (LOSS) 799,955 36,358
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 2,656,893 (377,507)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 4,133,507 (232,193)
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (89,843) (14,410)
FROM NET INVESTMENT INCOME
FROM NET REALIZED GAIN (35,937) -
TOTAL DISTRIBUTIONS (125,780) (14,410)
SHARE TRANSACTIONS 55,087,019 18,502,730
NET PROCEEDS FROM SALES OF FREEDOM FUND SHARES
REINVESTMENT OF DISTRIBUTIONS 125,408 14,332
COST OF FREEDOM FUND SHARES REDEEMED (11,686,287) (2,324,798)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 43,526,140 16,192,264
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 47,533,867 15,945,661
NET ASSETS
BEGINNING OF PERIOD 15,945,661 -
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT $ 63,479,528 $ 15,945,661
INCOME OF $676,659 AND $99,480, RESPECTIVELY)
OTHER INFORMATION
SHARES
SOLD 4,999,659 1,799,764
ISSUED IN REINVESTMENT OF DISTRIBUTIONS 12,082 1,404
REDEEMED (1,064,449) (225,219)
NET INCREASE (DECREASE) 3,947,292 1,575,949
</TABLE>
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
OF OPERATIONS) TO
MARCH 31,
(UNAUDITED) 1997
<TABLE>
<CAPTION>
<S> <C> <C>
SELECTED PER-SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.12 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
NET INVESTMENT INCOME D .21 .18
NET REALIZED AND UNREALIZED GAIN (LOSS) 1.23 .03 F
TOTAL FROM INVESTMENT OPERATIONS 1.44 .21
LESS DISTRIBUTIONS
FROM NET INVESTMENT INCOME (.05) (.09)
FROM NET REALIZED GAIN (.02) -
TOTAL DISTRIBUTIONS (.07) (.09)
NET ASSET VALUE, END OF PERIOD $ 11.49 $ 10.12
TOTAL RETURN B, C 14.30% 2.09%
RATIOS AND SUPPLEMENTAL DATA
(AMOUNTS DO NOT INCLUDE THE ACTIVITY OF THE UNDERLYING FUNDS)
NET ASSETS, END OF PERIOD (000 OMITTED) $ 63,480 $ 15,946
RATIO OF EXPENSES TO AVERAGE NET ASSETS .08% A, E .08% A, E
RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 3.82% A 4.00% A
PORTFOLIO TURNOVER RATE 29% A 19% A
</TABLE>
ANNUALIZED
TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
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).
NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
STRATEGIC ADVISERS AGREED TO REIMBURSE A PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S
EXPENSE RATIO WOULD HAVE BEEN HIGHER (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET LOSS ON INVESTMENTS FOR THE PERIOD DUE TO THE TIMING OF
SALES AND REPURCHASES OF FUND SHARES IN RELATION TO FLUCTUATING MARKET
VALUES OF THE INVESTMENTS OF THE FUND.
FIDELITY FREEDOM 2010 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF SEPTEMBER 30, 1997
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS IN THESE HOLDINGS
6 MONTHS AGO
DOMESTIC EQUITY FUNDS
BLUE CHIP GROWTH FUND 8.6% 8.7%
DISCIPLINED EQUITY FUND 8.6 8.8
EQUITY-INCOME FUND 8.7 9.0
FIDELITY FUND 8.7 8.8
GROWTH & INCOME PORTFOLIO 8.6 8.9
GROWTH COMPANY FUND 8.6 8.5
OTC PORTFOLIO 5.8 5.5
57.6 58.2
INTERNATIONAL EQUITY FUNDS
DIVERSIFIED INTERNATIONAL FUND 2.4 2.5
EUROPE FUND 2.4 2.6
JAPAN FUND 2.0 1.9
OVERSEAS FUND 2.4 2.6
SOUTHEAST ASIA FUND 0.5 0.5
9.7 10.1
INVESTMENT GRADE FIXED-INCOME FUNDS
GOVERNMENT SECURITIES FUND 9.4 9.2
INTERMEDIATE BOND FUND 6.1 6.1
INVESTMENT GRADE BOND FUND 9.4 9.3
24.9 24.6
HIGH YIELD FIXED-INCOME FUND
CAPITAL & INCOME FUND 7.2 7.1
MONEY MARKET FUND
FIDELITY MONEY MARKET TRUST: RETIREMENT 0.6 0.0
MONEY MARKET PORTFOLIO
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
7.1% (HY)
ROW: 1, COL: 1, VALUE: 7.1
ROW: 1, COL: 2, VALUE: 24.6
ROW: 1, COL: 3, VALUE: 10.1
ROW: 1, COL: 4, VALUE: 58.2
24.6% (IG)
58.2% (DE)
10.1% (IE)
CURRENT
0.6% (MM)
7.2% (HY)
ROW: 1, COL: 1, VALUE: 1.0
ROW: 1, COL: 2, VALUE: 7.2
ROW: 1, COL: 3, VALUE: 24.9
ROW: 1, COL: 4, VALUE: 9.699999999999999
ROW: 1, COL: 5, VALUE: 57.2
24.9% (IG)
57.6% (DE)
9.7% (IE)
EQUITY
DE = DOMESTIC EQUITY FUNDS
IE = INTERNATIONAL EQUITY FUNDS
EXPECTED
2.0% (MM)
FIXED-INCOME
IG = INVESTMENT GRADE FUNDS
HY = HIGH YIELD FUNDS
6.8% (HY)
ROW: 1, COL: 1, VALUE: 2.0
ROW: 1, COL: 2, VALUE: 7.0
ROW: 1, COL: 3, VALUE: 25.4
ROW: 1, COL: 4, VALUE: 9.0
ROW: 1, COL: 5, VALUE: 57.2
MONEY MARKET FUND (MM)
26.5% (IG)
56.0% (DE)
8.7% (IE)
THE FUND INVESTS ACCORDING TO AN ASSET ALLOCATION STRATEGY THAT
BECOMES INCREASINGLY CONSERVATIVE OVER TIME. THE SIX MONTHS AGO
ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31, 1997. THE
CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF SEPTEMBER 30,
1997. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT MARCH 31, 1998.
FIDELITY FREEDOM 2010 FUND
INVESTMENTS SEPTEMBER 30, 1997 (UNAUDIT
ED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
EQUITY FUNDS - 67.3%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 57.6%
Blue Chip Growth Fund 194,991 $ 7,758,704
Disciplined Equity Fund 270,000 7,754,395
Equity-Income Fund 147,714 7,834,738
Fidelity Fund 257,887 7,785,612
Growth & Income Portfolio 209,501 7,785,058
Growth Company Fund 155,713 7,756,081
OTC Portfolio 131,853 5,183,137
51,857,725
INTERNATIONAL EQUITY FUNDS - 9.7%
Diversified International Fund 125,600 2,195,487
Europe Fund 67,886 2,200,177
Japan Fund 145,357 1,753,006
Overseas Fund 59,800 2,194,056
Southeast Asia Fund 31,886 410,049
8,752,775
TOTAL EQUITY FUNDS
(Cost $55,569,700) 60,610,500
FIXED-INCOME FUNDS - 32.1%
INVESTMENT GRADE FIXED-INCOME FUNDS - 24.9%
Government Securities Fund 865,814 8,450,348
Intermediate Bond Fund 546,645 5,532,043
Investment Grade Bond Fund 1,173,496 8,449,169
22,431,560
HIGH YIELD FIXED-INCOME FUND - 7.2%
Capital & Income Fund 643,340 6,497,739
TOTAL FIXED-INCOME FUNDS
(Cost $28,345,486) 28,929,299
MONEY MARKET FUND - 0.6%
Fidelity Money Market Trust: Retirement
Money Market Portfolio
(Cost $521,892) 521,892 521,892
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $84,437,078) $ 90,061,691
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$63,396,754 and $3,661,929, respectively.
INCOME TAX INFORMATION
At September 30, 1997, the aggregate cost of investment securities for
income tax purposes was $84,437,259. Net unrealized appreciation
aggregated $5,624,432, of which $5,787,278 related to appreciated
investment securities and $162,846 related to depreciated investment
securities.
FIDELITY FREEDOM 2010 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS
INVESTMENT IN SECURITIES, AT VALUE (COST $84,437,078) - $ 90,061,691
SEE ACCOMPANYING SCHEDULE
CASH 11,983
RECEIVABLE FOR FREEDOM FUND SHARES SOLD 885,201
DIVIDENDS RECEIVABLE 142,018
TOTAL ASSETS 91,100,893
LIABILITIES
PAYABLE FOR UNDERLYING FUND SHARES PURCHASED $ 973,584
PAYABLE FOR FREEDOM FUND SHARES REDEEMED 66,011
ACCRUED MANAGEMENT FEE 6,090
TOTAL LIABILITIES 1,045,685
NET ASSETS $ 90,055,208
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 82,651,258
UNDISTRIBUTED NET INVESTMENT INCOME 651,456
ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) 1,127,881
ON INVESTMENTS
NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 5,624,613
NET ASSETS, FOR 7,453,077 SHARES OUTSTANDING $ 90,055,208
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER $12.08
SHARE ($90,055,208 (DIVIDED BY) 7,453,077 SHARES)
</TABLE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME $ 688,688
INCOME DISTRIBUTIONS FROM UNDERLYING FUNDS
INTEREST 507
TOTAL INCOME 689,195
EXPENSES
MANAGEMENT FEE $ 25,258
NON-INTERESTED TRUSTEES' COMPENSATION 92
TOTAL EXPENSES BEFORE REDUCTIONS 25,350
EXPENSE REDUCTIONS (5,243) 20,107
NET INVESTMENT INCOME 669,088
REALIZED AND UNREALIZED GAIN (LOSS)
CAPITAL GAIN DISTRIBUTIONS FROM UNDERLYING FUNDS 682,847
REALIZED GAIN (LOSS) ON SALE OF UNDERLYING FUND SHARES 450,515 1,133,362
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON 6,278,432
INVESTMENT SECURITIES
NET GAIN (LOSS) 7,411,794
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 8,080,882
FROM OPERATIONS
OTHER INFORMATION $ 5,182
EXPENSE REDUCTIONS
REIMBURSEMENT FROM INVESTMENT ADVISER
CUSTODIAN INTEREST CREDITS 61
$ 5,243
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
(UNAUDITED) OF OPERATIONS) TO
MARCH 31,
1997
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS $ 669,088 $ 93,648
NET INVESTMENT INCOME
NET REALIZED GAIN (LOSS) 1,133,362 31,087
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 6,278,432 (653,819)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 8,080,882 (529,084)
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (110,726) (5,289)
FROM NET INVESTMENT INCOME
FROM NET REALIZED GAIN (27,684) -
TOTAL DISTRIBUTIONS (138,410) (5,289)
SHARE TRANSACTIONS 66,953,322 26,783,587
NET PROCEEDS FROM SALES OF FREEDOM FUND SHARES
REINVESTMENT OF DISTRIBUTIONS 138,217 5,289
COST OF FREEDOM FUND SHARES REDEEMED (8,578,469) (2,654,837)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 58,513,070 24,134,039
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 66,455,542 23,599,666
NET ASSETS
BEGINNING OF PERIOD 23,599,666 -
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT $ 90,055,208 $ 23,599,666
INCOME OF $651,456 AND $93,710, RESPECTIVELY)
OTHER INFORMATION
SHARES
SOLD 5,883,069 2,579,315
ISSUED IN REINVESTMENT OF DISTRIBUTIONS 13,102 516
REDEEMED (767,380) (255,545)
NET INCREASE (DECREASE) 5,128,791 2,324,286
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
(UNAUDITED) OF OPERATIONS) TO
MARCH 31,
1997
SELECTED PER-SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.15 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
NET INVESTMENT INCOME D .15 .11
NET REALIZED AND UNREALIZED GAIN (LOSS) 1.83 .15 F
TOTAL FROM INVESTMENT OPERATIONS 1.98 .26
LESS DISTRIBUTIONS
FROM NET INVESTMENT INCOME (.04) (.11)
FROM NET REALIZED GAIN (.01) -
TOTAL DISTRIBUTIONS (.05) (.11)
NET ASSET VALUE, END OF PERIOD $ 12.08 $ 10.15
TOTAL RETURN B, C 19.58% 2.59%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD (000 OMITTED) $ 90,055 $ 23,600
RATIO OF EXPENSES TO AVERAGE NET ASSETS .08% A, E .08% A,
E
RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 2.63% A 2.56% A
PORTFOLIO TURNOVER RATE 14% A 3% A
</TABLE>
ANNUALIZED
TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
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).
NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
STRATEGIC ADVISERS AGREED TO REIMBURSE A PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S
EXPENSE RATIO WOULD HAVE BEEN HIGHER (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET LOSS ON INVESTMENTS FOR THE PERIOD DUE TO THE TIMING OF
SALES AND REPURCHASES OF FUND SHARES IN RELATION TO FLUCTUATING MARKET
VALUES OF THE INVESTMENTS OF THE FUND.
FIDELITY FREEDOM 2020 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF SEPTEMBER 30, 1997
% OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS IN THESE HOLDINGS
6 MONTHS AGO
DOMESTIC EQUITY FUNDS
BLUE CHIP GROWTH FUND 10.3% 10.4%
DISCIPLINED EQUITY FUND 10.3 10.5
EQUITY-INCOME FUND 10.4 10.7
FIDELITY FUND 10.3 10.4
GROWTH & INCOME PORTFOLIO 10.3 10.6
GROWTH COMPANY FUND 10.3 10.2
OTC PORTFOLIO 6.9 6.5
68.8 69.3
INTERNATIONAL EQUITY FUNDS
DIVERSIFIED INTERNATIONAL FUND 3.2 3.2
EUROPE FUND 3.2 3.3
JAPAN FUND 2.6 2.5
OVERSEAS FUND 3.2 3.3
SOUTHEAST ASIA FUND 0.6 0.6
12.8 12.9
INVESTMENT GRADE FIXED-INCOME FUNDS
GOVERNMENT SECURITIES FUND 4.0 3.8
INTERMEDIATE BOND FUND 2.7 2.5
INVESTMENT GRADE BOND FUND 4.0 3.8
10.7 10.1
HIGH YIELD FIXED-INCOME FUND
CAPITAL & INCOME FUND 7.7 7.7
100.0% 100.0%
ASSET ALLOCATION
SIX MONTHS AGO
7.7% (HY)
ROW: 1, COL: 1, VALUE: 7.7
ROW: 1, COL: 2, VALUE: 10.1
ROW: 1, COL: 3, VALUE: 12.9
ROW: 1, COL: 4, VALUE: 69.3
10.1% (IG)
12.9% (IE)
69.3% (DE)
CURRENT
7.7% (HY)
ROW: 1, COL: 1, VALUE: 7.7
ROW: 1, COL: 2, VALUE: 10.7
ROW: 1, COL: 3, VALUE: 12.8
ROW: 1, COL: 4, VALUE: 68.8
10.7% (IG)
68.8% (DE)
12.8% (IE)
EQUITY
DE = DOMESTIC EQUITY FUNDS
IE = INTERNATIONAL EQUITY FUNDS
EXPECTED
7.5% (HY)
FIXED-INCOME
IG = INVESTMENT GRADE FUNDS
HY = HIGH YIELD FUNDS
ROW: 1, COL: 1, VALUE: 7.5
ROW: 1, COL: 2, VALUE: 12.1
ROW: 1, COL: 3, VALUE: 12.1
ROW: 1, COL: 4, VALUE: 68.3
12.1% (IG)
12.1% (IE)
68.3% (DE)
THE FUND INVESTS ACCORDING TO AN ASSET ALLOCATION STRATEGY THAT
BECOMES INCREASINGLY CONSERVATIVE OVER TIME. THE SIX MONTHS AGO
ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31, 1997. THE
CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF SEPTEMBER 30,
1997. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT MARCH 31, 1998.
FIDELITY FREEDOM 2020 FUND
INVESTMENTS SEPTEMBER 30, 1997 (UNAUDITE
D)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
EQUITY FUNDS - 81.6%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 68.8%
Blue Chip Growth Fund 159,397 $ 6,342,391
Disciplined Equity Fund 220,623 6,336,282
Equity-Income Fund 120,773 6,405,817
Fidelity Fund 210,687 6,360,631
Growth & Income Portfolio 171,230 6,362,915
Growth Company Fund 127,287 6,340,146
OTC Portfolio 107,771 4,236,469
42,384,651
INTERNATIONAL EQUITY FUNDS - 12.8%
Diversified International Fund 113,466 1,983,384
Europe Fund 61,382 1,989,388
Japan Fund 131,051 1,580,474
Overseas Fund 54,086 1,984,426
Southeast Asia Fund 28,235 363,099
7,900,771
TOTAL EQUITY FUNDS
(Cost $46,018,451) 50,285,422
FIXED-INCOME FUNDS - 18.4%
INVESTMENT GRADE FIXED-INCOME FUNDS - 10.7%
Government Securities Fund 253,257 2,471,786
Intermediate Bond Fund 159,615 1,615,303
Investment Grade Bond Fund 343,304 2,471,787
6,558,876
HIGH YIELD FIXED-INCOME FUND - 7.7%
Capital & Income Fund 470,282 4,749,844
TOTAL FIXED-INCOME FUNDS
(Cost $10,985,196) 11,308,720
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $57,003,647) $ 61,594,142
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$42,981,063 and $1,644,372, respectively.
INCOME TAX INFORMATION
At September 30, 1997, the aggregate cost of investment securities for
income tax purposes was $57,003,912. Net unrealized appreciation
aggregated $4,590,230, of which $4,729,464 related to appreciated
investment securities and $139,234 related to depreciated investment
securities.
FIDELITY FREEDOM 2020 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS
INVESTMENT IN SECURITIES, AT VALUE (COST $57,003,647) - $ 61,594,142
SEE ACCOMPANYING SCHEDULE
RECEIVABLE FOR FREEDOM FUND SHARES SOLD 453,033
DIVIDENDS RECEIVABLE 54,266
TOTAL ASSETS 62,101,441
LIABILITIES
PAYABLE TO CUSTODIAN BANK $ 110
PAYABLE FOR UNDERLYING FUND SHARES PURCHASED 458,227
PAYABLE FOR FREEDOM FUND SHARES REDEEMED 49,507
ACCRUED MANAGEMENT FEE 3,790
TOTAL LIABILITIES 511,634
NET ASSETS $ 61,589,807
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 55,853,595
UNDISTRIBUTED NET INVESTMENT INCOME 305,514
ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) 840,203
ON INVESTMENTS
NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 4,590,495
NET ASSETS, FOR 4,965,846 SHARES OUTSTANDING $ 61,589,807
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE $12.40
PER SHARE ($61,589,807 (DIVIDED BY) 4,965,846 SHARES)
</TABLE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME $ 335,880
INCOME DISTRIBUTIONS FROM UNDERLYING FUNDS
INTEREST 196
TOTAL INCOME 336,076
EXPENSES
MANAGEMENT FEE $ 17,398
NON-INTERESTED TRUSTEES' COMPENSATION 63
TOTAL EXPENSES BEFORE REDUCTIONS 17,461
EXPENSE REDUCTIONS (3,635) 13,826
NET INVESTMENT INCOME 322,250
REALIZED AND UNREALIZED GAIN (LOSS)
CAPITAL GAIN DISTRIBUTIONS FROM UNDERLYING FUNDS 561,835
REALIZED GAIN (LOSS) ON SALE OF UNDERLYING FUND SHARES 279,584 841,419
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 5,020,493
ON INVESTMENT SECURITIES
NET GAIN (LOSS) 5,861,912
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 6,184,162
FROM OPERATIONS
OTHER INFORMATION $ 3,574
EXPENSE REDUCTIONS
REIMBURSEMENT FROM INVESTMENT ADVISER
CUSTODIAN INTEREST CREDITS 61
$ 3,635
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
(UNAUDITED) OF OPERATIONS) TO
MARCH 31,
1997
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS $ 322,250 $ 43,262
NET INVESTMENT INCOME
NET REALIZED GAIN (LOSS) 841,419 44,065
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 5,020,493 (429,998)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 6,184,162 (342,671)
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (56,576) (4,270)
FROM NET INVESTMENT INCOME
FROM NET REALIZED GAIN (37,031) -
TOTAL DISTRIBUTIONS (93,607) (4,270)
SHARE TRANSACTIONS 45,164,872 17,189,961
NET PROCEEDS FROM SALES OF FREEDOM FUND SHARES
REINVESTMENT OF DISTRIBUTIONS 93,607 4,270
COST OF FREEDOM FUND SHARES REDEEMED (4,717,710) (1,888,807)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 40,540,769 15,305,424
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 46,631,324 14,958,483
NET ASSETS
BEGINNING OF PERIOD 14,958,483 -
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT $ 61,589,807 $ 14,958,483
INCOME OF $305,514 AND $43,724, RESPECTIVELY)
OTHER INFORMATION
SHARES
SOLD 3,899,251 1,645,700
ISSUED IN REINVESTMENT OF DISTRIBUTIONS 8,781 414
REDEEMED (407,899) (180,401)
NET INCREASE (DECREASE) 3,500,133 1,465,713
</TABLE>
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
OF OPERATIONS) TO
MARCH 31,
(UNAUDITED) 1997
<TABLE>
<CAPTION>
<S> <C> <C>
SELECTED PER-SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.21 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
NET INVESTMENT INCOME D .11 .08
NET REALIZED AND UNREALIZED GAIN (LOSS) 2.13 .22 F
TOTAL FROM INVESTMENT OPERATIONS 2.24 .30
LESS DISTRIBUTIONS
FROM NET INVESTMENT INCOME (.03) (.09)
FROM NET REALIZED GAIN (.02) -
TOTAL DISTRIBUTIONS (.05) (.09)
NET ASSET VALUE, END OF PERIOD $ 12.40 $ 10.21
TOTAL RETURN B, C 22.02% 2.99%
RATIOS AND SUPPLEMENTAL DATA
(AMOUNTS DO NOT INCLUDE THE ACTIVITY OF THE UNDERLYING FUNDS)
NET ASSETS, END OF PERIOD (000 OMITTED) $ 61,590 $ 14,958
RATIO OF EXPENSES TO AVERAGE NET ASSETS .08% A, E .08% A, E
RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.84% A 1.75% A
PORTFOLIO TURNOVER RATE 9% A 21% A
</TABLE>
ANNUALIZED
TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
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).
NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
STRATEGIC ADVISERS AGREED TO REIMBURSE A PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S
EXPENSE RATIO WOULD HAVE BEEN HIGHER (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET LOSS ON INVESTMENTS FOR THE PERIOD DUE TO THE TIMING OF
SALES AND REPURCHASES OF FUND SHARES IN RELATION TO FLUCTUATING MARKET
VALUES OF THE INVESTMENTS OF THE FUND.
FIDELITY FREEDOM 2030 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF SEPTEMBER 30, 1997
% OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS IN THESE HOLDINGS
6 MONTHS AGO
DOMESTIC EQUITY FUNDS
BLUE CHIP GROWTH FUND 10.4% 10.4%
DISCIPLINED EQUITY FUND 10.3 10.5
EQUITY-INCOME FUND 10.4 10.6
FIDELITY FUND 10.4 10.4
GROWTH & INCOME PORTFOLIO 10.4 10.5
GROWTH COMPANY FUND 10.4 10.2
OTC PORTFOLIO 6.9 6.6
69.2 69.2
INTERNATIONAL EQUITY FUNDS
DIVERSIFIED INTERNATIONAL FUND 3.9 3.9
EUROPE FUND 3.9 4.0
JAPAN FUND 3.1 3.0
OVERSEAS FUND 3.8 3.9
SOUTHEAST ASIA FUND 0.7 0.7
15.4 15.5
INVESTMENT GRADE FIXED-INCOME FUNDS
GOVERNMENT SECURITIES FUND 2.0 1.9
INTERMEDIATE BOND FUND 1.3 1.3
INVESTMENT GRADE BOND FUND 2.0 1.9
5.3 5.1
HIGH YIELD FIXED-INCOME FUND
CAPITAL & INCOME FUND 10.1 10.2
100.0% 100.0%
ASSET ALLOCATION
SIX MONTHS AGO
10.2% (HY)
ROW: 1, COL: 1, VALUE: 10.2
ROW: 1, COL: 2, VALUE: 5.1
ROW: 1, COL: 3, VALUE: 15.5
ROW: 1, COL: 4, VALUE: 69.2
5.1% (IG)
15.5% (IE)
69.2% (DE)
CURRENT
10.1% (HY)
ROW: 1, COL: 1, VALUE: 10.1
ROW: 1, COL: 2, VALUE: 5.3
ROW: 1, COL: 3, VALUE: 15.4
ROW: 1, COL: 4, VALUE: 69.2
5.3% (IG)
15.4% (IE)
69.2% (DE)
EQUITY
DE = DOMESTIC EQUITY FUNDS
IE = INTERNATIONAL EQUITY FUNDS
EXPECTED
9.6% (HY)
FIXED-INCOME
IG = INVESTMENT GRADE FUNDS
HY = HIGH YIELD FUND
ROW: 1, COL: 1, VALUE: 9.6
ROW: 1, COL: 2, VALUE: 5.8
ROW: 1, COL: 3, VALUE: 14.6
ROW: 1, COL: 4, VALUE: 70.0
5.8% (IG)
14.6% (IE)
70.0% (DE)
THE FUND INVESTS ACCORDING TO AN ASSET ALLOCATION STRATEGY THAT
BECOMES INCREASINGLY CONSERVATIVE OVER TIME. THE SIX MONTHS AGO
ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31, 1997. THE
CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF SEPTEMBER 30,
1997. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT MARCH 31, 1998.
FIDELITY FREEDOM 2030 FUND
INVESTMENTS SEPTEMBER 30, 1997
(UNAUDITED)
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
EQUITY FUNDS - 84.6%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 69.2%
Blue Chip Growth Fund 94,162 $ 3,746,725
Disciplined Equity Fund 130,278 3,741,578
Equity-Income Fund 71,292 3,781,320
Fidelity Fund 124,562 3,760,519
Growth & Income Portfolio 101,123 3,757,713
Growth Company Fund 75,200 3,745,692
OTC Portfolio 63,667 2,502,732
25,036,279
INTERNATIONAL EQUITY FUNDS - 15.4%
Diversified International Fund 79,884 1,396,364
Europe Fund 43,237 1,401,313
Japan Fund 92,163 1,111,486
Overseas Fund 38,036 1,395,558
Southeast Asia Fund 19,858 255,372
5,560,093
TOTAL EQUITY FUNDS
(Cost $28,298,651) 30,596,372
FIXED-INCOME FUNDS - 15.4%
INVESTMENT GRADE FIXED-INCOME FUNDS - 5.3%
Government Securities Fund 73,263 715,051
Intermediate Bond Fund 46,217 467,712
Investment Grade Bond Fund 99,443 715,989
1,898,752
HIGH YIELD FIXED-INCOME FUND - 10.1%
Capital & Income Fund 362,997 3,666,268
TOTAL FIXED-INCOME FUNDS
(Cost $5,346,303) 5,565,020
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $33,644,954) $ 36,161,392
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$29,186,031 and $1,614,230, respectively.
INCOME TAX INFORMATION
At September 30, 1997, the aggregate cost of investment securities for
income tax purposes was $33,645,085. Net unrealized appreciation
aggregated $2,516,307, of which $2,618,070 related to appreciated
investment securities and $101,763 related to depreciated investment
securities.
FIDELITY FREEDOM 2030 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS
INVESTMENT IN SECURITIES, AT VALUE (COST $33,644,954) - $ 36,161,392
SEE ACCOMPANYING SCHEDULE
CASH 8,012
RECEIVABLE FOR FREEDOM FUND SHARES SOLD 263,347
DIVIDENDS RECEIVABLE 26,250
TOTAL ASSETS 36,459,001
LIABILITIES
PAYABLE FOR UNDERLYING FUND SHARES PURCHASED $ 213,671
PAYABLE FOR FREEDOM FUND SHARES REDEEMED 82,896
ACCRUED MANAGEMENT FEE 2,500
TOTAL LIABILITIES 299,067
NET ASSETS $ 36,159,934
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 32,975,415
UNDISTRIBUTED NET INVESTMENT INCOME 162,482
ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) 505,599
ON INVESTMENTS
NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 2,516,438
NET ASSETS, FOR 2,895,118 SHARES OUTSTANDING $ 36,159,934
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE $12.49
PER SHARE ($36,159,934 (DIVIDED BY) 2,895,118 SHARES)
</TABLE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME $ 169,554
INCOME DISTRIBUTION FROM UNDERLYING FUNDS
INTEREST 41
TOTAL INCOME 169,595
EXPENSES
MANAGEMENT FEE $ 9,561
NON-INTERESTED TRUSTEES' COMPENSATION 31
TOTAL EXPENSES BEFORE REDUCTIONS 9,592
EXPENSE REDUCTIONS (2,011) 7,581
NET INVESTMENT INCOME 162,014
REALIZED AND UNREALIZED GAIN (LOSS)
CAPITAL GAIN DISTRIBUTIONS FROM UNDERLYING FUNDS 335,705
REALIZED GAIN (LOSS) ON SALE OF UNDERLYING FUND SHARES 172,691 508,396
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 2,692,243
ON INVESTMENT SECURITIES
NET GAIN (LOSS) 3,200,639
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 3,362,653
FROM OPERATIONS
OTHER INFORMATION $ 1,978
EXPENSE REDUCTIONS
REIMBURSEMENT FROM INVESTMENT ADVISER
CUSTODIAN INTEREST CREDITS 33
$ 2,011
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
(UNAUDITED) OF OPERATIONS) TO
MARCH 31,
1997
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS $ 162,014 $ 12,270
NET INVESTMENT INCOME
NET REALIZED GAIN (LOSS) 508,396 19,374
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 2,692,243 (175,805)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 3,362,653 (144,161)
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (9,142) (3,835)
FROM NET INVESTMENT INCOME
FROM NET REALIZED GAIN (18,288) -
TOTAL DISTRIBUTIONS (27,430) (3,835)
SHARE TRANSACTIONS 33,667,883 6,627,125
NET PROCEEDS FROM SALES OF FREEDOM FUND SHARES
REINVESTMENT OF DISTRIBUTIONS 27,430 3,834
COST OF FREEDOM FUND SHARES REDEEMED (6,596,012) (757,553)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 27,099,301 5,873,406
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 30,434,524 5,725,410
NET ASSETS
BEGINNING OF PERIOD 5,725,410 -
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT $ 36,159,934 $ 5,725,410
INCOME OF $162,482 AND $10,649, RESPECTIVELY)
OTHER INFORMATION
SHARES
SOLD 2,902,969 632,180
ISSUED IN REINVESTMENT OF DISTRIBUTIONS 2,566 372
REDEEMED (570,963) (72,006)
NET INCREASE (DECREASE) 2,334,572 560,546
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED OCTOBER 17, 1996
SEPTEMBER 30, 1997 (COMMENCEMENT
OF OPERATIONS) TO
MARCH 31,
(UNAUDITED) 1997
SELECTED PER-SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.21 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
NET INVESTMENT INCOME D .10 .08
NET REALIZED AND UNREALIZED GAIN (LOSS) 2.21 .22 F
TOTAL FROM INVESTMENT OPERATIONS 2.31 .30
LESS DISTRIBUTIONS
FROM NET INVESTMENT INCOME (.01) (.09)
FROM NET REALIZED GAIN (.02) -
TOTAL DISTRIBUTIONS (.03) (.09)
NET ASSET VALUE, END OF PERIOD $ 12.49 $ 10.21
TOTAL RETURN B, C 22.67% 2.99%
RATIOS AND SUPPLEMENTAL DATA
NET ASSETS, END OF PERIOD (000 OMITTED) $ 36,160 $ 5,725
RATIO OF EXPENSES TO AVERAGE NET ASSETS .08% A, E .08% A, E
RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.68% A 1.71% A
PORTFOLIO TURNOVER RATE 17% A 19% A
</TABLE>
ANNUALIZED
TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
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).
NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
STRATEGIC ADVISERS AGREED TO REIMBURSE A PORTION OF THE FUND'S
EXPENSES DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S
EXPENSE RATIO WOULD HAVE BEEN HIGHER (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS).
THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET LOSS ON INVESTMENTS FOR THE PERIOD DUE TO THE TIMING OF
SALES AND REPURCHASES OF FUND SHARES IN RELATION TO FLUCTUATING MARKET
VALUES OF THE INVESTMENTS OF THE FUND.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED SEPTEMBER 30, 1997 (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Freedom Income Fund, Fidelity Freedom 2000 Fund, Fidelity
Freedom 2010 Fund, Fidelity Freedom 2020 Fund, and Fidelity Freedom
2030 Fund (the funds) are funds of Fidelity Aberdeen Street Trust (the
trust). 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 Delaware business trust. Each fund is
authorized to issue an unlimited number of shares. The funds primarily
invest in a combination of other Fidelity equity, fixed income, and
money market funds (the Underlying Funds) managed by Fidelity
Management & Research Company (FMR). The financial statements have
been prepared in conformity with generally accepted accounting
principles which permit management to make certain estimates and
assumptions at the date of the financial statements. The following
summarizes the significant accounting policies of the funds:
SECURITY VALUATION. Investments in the Underlying Funds are valued at
the closing net asset value per share of each Underlying Fund on the
day of valuation. 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.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for the fiscal year. The schedules of investments
include information regarding income taxes under the caption "Income
Tax Information."
INVESTMENT INCOME. Income and capital gain distributions from the
Underlying Funds, if any, are recorded on the ex-dividend date.
Interest income is accrued as earned.
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. Expenses included in the accompanying
financial statements reflect the expenses of each fund and do not
include any expenses associated with the Underlying Funds.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions from net investment
income to shareholders of the Freedom Income Fund are paid monthly,
while distributions from capital gains, if any, are recorded on the
ex-dividend date. Income and capital gain distributions to
shareholders of the other Freedom Funds 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 non-taxable dividends and losses deferred due to wash
sales. The funds also utilized earnings and profits distributed to
shareholders on redemption of shares as a part of the dividends paid
deduction for income tax purposes.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS -
CONTINUED
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income and accumulated undistributed net
realized gain (loss) on investments 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 funds, 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 for U.S. Treasury or Federal Agency
obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
securities are transferred to an account of the funds, or to the Joint
Trading Account, at a bank custodian. The securities are
marked-to-market daily and maintained at a value at least equal to the
principal amount of the repurchase agreement (including accrued
interest). FMR is responsible for determining that the value of the
underlying securities remains in accordance with the market value
requirements stated above.
3. PURCHASES AND SALES OF INVESTMENTS.
Information regarding purchases and redemptions of the underlying fund
shares is included under the caption "Other Information" at the end of
each fund's schedule of investments.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. Each fund pays a management fee to Strategic Advisers,
Inc., an affiliate of FMR. Strategic Advisers receives a fee that is
computed daily at an annual rate of .10% of each fund's average net
assets.
OTHER TRANSACTIONS. Strategic Advisers has entered into an
administration agreement with FMR under which FMR provides management
and administrative services (other than investment advisory services)
necessary for the operation of each fund. Pursuant to this agreement,
FMR pays all expenses of each fund, except the compensation of the
non-interested trustees and certain exceptions such as interest,
taxes, brokerage commissions, and extraordinary expenses. FMR also
contracts with other Fidelity companies to perform the services
necessary for the operation of each fund. For the services under the
agreement, Strategic Advisers pays FMR a monthly administration fee
equal to the
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
OTHER TRANSACTIONS - CONTINUED
management fee received by Strategic Advisers, minus an amount equal
to an annual rate of .02% of each fund's average net assets.
5. EXPENSE REDUCTIONS.
Strategic Advisers voluntarily agreed to reimburse each fund's
management fee above an annual rate of .08% of the fund's average net
assets.
In addition, certain funds have entered into an arrangement with their
custodian whereby credits realized as a result of uninvested cash
balances were used to reduce a portion of each applicable fund's
expenses.
For the period, the reductions under these arrangements are shown
under the caption "Other Information" on each applicable fund's
Statement of Operations.
6. BENEFICIAL INTEREST.
At the end of the period, certain unaffiliated shareholders were each
record owners of 10% or more of the total outstanding shares of the
following funds:
BENEFICIAL INTEREST
FUND NUMBER OF SHAREHOLDERS % OWNERSHIP
Freedom Income 2 38%
Freedom 2000 3 38%
Freedom 2010 2 34%
Freedom 2020 2 28%
Freedom 2030 2 33%
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a
day.
BY PHONE
Fidelity TouchTone Xpressprovides a single toll-free number to access
account balances, positions, quotes and trading. It's easy to navigate
the service, and on your first call, the system will help you create a
personal identification number (PIN) for security.
SM
(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
For quotes.*
For account balances and holdings.
To review orders and mutual
fund activity.
To change your PIN.
To speak to a Fidelity representative.
0
*
BY PC
Fidelity's Web site on the Internet provides a wide range of
information, including daily financial news, fund performance,
interactive planning tools and news about Fidelity products and
services.
(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at
1-800-544-7272 for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity
at 1-800-544-7272 or visit our Web site for more information on how to
manage your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD
AND RETURN WILL VARY AND,
EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS MEANS
THAT YOU MAY HAVE A GAIN
OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO ASSURANCE THAT MONEY
MARKET FUNDS WILL BE ABLE TO
MAINTAIN A STABLE $1 SHARE PRICE; AN INVESTMENT IN A MONEY MARKET FUND
IS NOT INSURED OR
GUARANTEED BY THE U.S. GOVERNMENT. TOTAL RETURNS ARE HISTORICAL AND
INCLUDE CHANGES IN SHARE PRICE,
REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS, AND THE EFFECTS OF ANY
SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and
send you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
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OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH1A
Hebron, KY 41048
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6I
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
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Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
150 Essex Street
Millburn, NJ
56 South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
NEW YORK
1055 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
1271 Avenue of the Americas
New York, NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
1903 East Ninth Street
Cleveland, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
6150 Poplar Road
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
4017 Northwest Parkway
Dallas, TX
1155 Dairy Ashford Street
Houston, TX
2701 Drexel Drive
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
19740 IH 45 North
Spring, TX
UTAH
215 South State Street
Salt Lake City, UT
VERMONT
199 Main Street
Burlington, VT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
511 Pine Street
Seattle, WA
WASHINGTON, DC
1900 K Street, N.W.
Washington, DC
WISCONSIN
595 North Barker Road
Brookfield, WI
INVESTMENT ADVISER
Strategic Advisers, Inc.
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
William J. Hayes, Vice President
Robert A. Lawrence, Vice President
Scott D. Stewart, Vice President
Arthur S. Loring, Secretary
Richard A. Silver, Treasurer
Robert H. Morrison, Manager,
Security Transactions
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
* INDEPENDENT TRUSTEES
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Investments Institutional
Operations Company, Inc.
Boston, MA
CUSTODIAN
The Bank of New York
New York, NY
FIDELITY'S ASSET ALLOCATION FUNDS
Asset Manager
SM
Asset Manager: Growth
SM
Asset Manager: Income
SM
Fidelity Freedom Funds-
Income, 2000, 2010, 2020, 2030
SM
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(registered trademark)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE
