FIDELITY
FREEDOM
FUNDS(REGISTERED TRADEMARK) - INCOME, 2000, 2010, 2020, 2030
ANNUAL REPORT
MARCH 31, 1999
(fidelity_logo_graphic)(registered trademark)
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.
REPORT OF INDEPENDENT 60 The auditors' opinion.
ACCOUNTANTS
DISTRIBUTIONS 61
OF SPECIAL NOTE 62
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Distributors Corporation.
Other third party marks appearing herein are the property of their
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All other marks appearing herein are registered or unregistered
trademarks or service marks of FMR Corp. or an affiliated company.
This report is printed on recycled paper using soy-based inks.
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.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
Breaking through 10,000 by the Dow Jones Industrial Average was the
big news in equity markets during March, as that milestone was the
last of six new highs the Dow recorded during the month. Renewed
strength in the energy and cyclical sectors contributed to the rally.
In fixed-income, Treasuries continued to struggle based on the
persistent strength of the economy, as yields on the 30-year benchmark
rose to their highest levels since August of 1998.
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 an investment in a money market fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although money market funds seek to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in these types of funds.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money 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. Of course, you should
consider your financial ability to continue your purchases through
periods of low price levels before undertaking such a strategy.
If you have questions, please call us at 1-800-544-8888, or visit our
web site at www.fidelity.com. 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(REGISTERED TRADEMARK)
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 MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM INCOME 8.41% 27.01%
FIDELITY FREEDOM INCOME 7.67% 27.84%
COMPOSITE
Wilshire 5000 13.09% 75.75%
LB Aggregate Bond 6.49% 20.68%
LB 3 Month T-Bill 5.09% 13.56%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year 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 Fidelity Freedom Income Composite Index, a
hypothetical combination of the following unmanaged indices: the
Wilshire 5000 Index, the Lehman Brothers Aggregate Bond Index, and the
Lehman Brothers 3 Month Treasury Bill Index according to the composite
benchmark weightings. This benchmark includes reinvested dividends and
capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM INCOME 8.41% 10.24%
FIDELITY FREEDOM INCOME 7.67% 10.54%
COMPOSITE
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.
$10,000 OVER LIFE OF FUND
Freedom Income FID Freedom Income
LB Aggregate Bond
00369 F0199
LB001
1996/10/17 10000.00 10000.00
10000.00
1996/10/31 10030.00 10028.71
10097.80
1996/11/30 10240.00 10247.43
10270.47
1996/12/31 10179.60 10204.29
10174.95
1997/01/31 10310.89 10344.97
10206.50
1997/02/28 10320.95 10370.50
10232.01
1997/03/31 10199.19 10250.14
10118.44
1997/04/30 10361.97 10421.14
10270.21
1997/05/31 10556.06 10630.51
10367.78
1997/06/30 10709.79 10794.08
10491.16
1997/07/31 11018.25 11099.52
10774.42
1997/08/31 10904.70 10998.75
10682.84
1997/09/30 11101.56 11213.90
10840.94
1997/10/31 11101.33 11223.53
10998.14
1997/11/30 11195.23 11336.98
11048.73
1997/12/31 11290.08 11444.19
11160.32
1998/01/31 11396.39 11537.19
11303.17
1998/02/28 11577.51 11718.56
11294.13
1998/03/31 11716.58 11873.82
11332.53
1998/04/30 11770.00 11948.08
11391.46
1998/05/31 11780.60 11951.40
11499.68
1998/06/30 11933.05 12096.33
11597.23
1998/07/31 11954.76 12074.88
11621.84
1998/08/31 11669.66 11799.62
11811.01
1998/09/30 11955.69 12089.29
12087.52
1998/10/31 12121.51 12262.52
12023.75
1998/11/30 12298.83 12461.41
12091.84
1998/12/31 12543.67 12655.32
12128.21
1999/01/31 12689.53 12803.77
12214.83
1999/02/28 12543.61 12636.89
12001.56
1999/03/31 12701.39 12784.03
12068.15
IMATRL PRASUN SHR__CHT 19990331 19990414 143952 R00000000000033
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom Income Fund on October 17, 1996, when the
fund started. As the chart shows, by March 31, 1999, the value of the
investment would have grown to $12,701 - a 27.01% 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 $12,068 - a 20.68% increase. With dividends and capital
gains, if any, reinvested, the same $10,000 investment in the Fidelity
Freedom Income Composite Index would have grown to 12,784 - a 27.84%
increase.
(checkmark)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
long-term growth and
short-term volatility. In turn, the
share price and return of a
fund that invests in stocks will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
* LEHMAN BROTHERS AGGREGATE BOND INDEX IS A MARKET VALUE-WEIGHTED
INDEX OF INVESTMENT-GRADE FIXED-RATE DEBT ISSUES, INCLUDING
GOVERNMENT, CORPORATE, ASSET-BACKED, AND MORTGAGE-BACKED SECURITIES,
WITH MATURITIES OF ONE YEAR OR MORE.
FIDELITY FREEDOM 2000 FUND(REGISTERED TRADEMARK)
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 MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2000 10.51% 39.05%
FIDELITY FREEDOM 2000 COMPOSITE 9.11% 39.90%
Wilshire 5000 13.09% 75.75%
MSCI EAFE 6.31% 25.92%
LB Aggregate Bond 6.49% 20.68%
ML High Yield Master 1.94% 21.86%
LB 3 Month T-Bill 5.09% 13.56%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year 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 Fidelity Freedom 2000 Composite Index, a
hypothetical combination of the following unmanaged indices: the
Wilshire 5000 Index, the Morgan Stanley Capital International Europe,
Australasia and Far East (MSCI EAFE) Index, the Lehman Brothers
Aggregate Bond Index, the Merrill Lynch High Yield Master Index, and
the Lehman Brothers 3 Month Treasury Bill Index. The index weightings
are adjusted twice a year to reflect the fund's changing asset
allocations. This benchmark includes reinvested dividends and capital
gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2000 10.51% 14.39%
FIDELITY FREEDOM 2000 COMPOSITE 9.11% 14.67%
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.
$10,000 OVER LIFE OF FUND
Freedom 2000 FID Freedom 2000
LB Aggregate Bond
00370 F0200
LB001
1996/10/17 10000.00 10000.00
10000.00
1996/10/31 10000.00 10002.40
10097.80
1996/11/30 10340.00 10362.67
10270.47
1996/12/31 10239.47 10280.05
10174.95
1997/01/31 10441.23 10501.66
10206.50
1997/02/28 10451.32 10528.77
10232.01
1997/03/31 10209.21 10300.61
10118.44
1997/04/30 10451.32 10552.89
10270.21
1997/05/31 10806.18 10932.24
10367.78
1997/06/30 11070.24 11220.08
10491.16
1997/07/31 11578.05 11699.65
10774.42
1997/08/31 11313.99 11457.72
10682.84
1997/09/30 11669.45 11828.31
10840.94
1997/10/31 11517.11 11716.52
10998.14
1997/11/30 11669.45 11890.52
11048.73
1997/12/31 11805.30 12039.13
11160.32
1998/01/31 11941.83 12164.84
11303.17
1998/02/28 12319.94 12538.20
11294.13
1998/03/31 12582.51 12822.10
11332.53
1998/04/30 12656.03 12921.34
11391.46
1998/05/31 12591.25 12849.45
11499.68
1998/06/30 12836.88 13078.53
11597.23
1998/07/31 12847.56 13001.07
11621.84
1998/08/31 12067.95 12267.55
11811.01
1998/09/30 12495.13 12674.52
12087.52
1998/10/31 12826.20 13046.34
12023.75
1998/11/30 13189.31 13432.82
12091.84
1998/12/31 13607.24 13794.42
12128.21
1999/01/31 13872.10 14024.01
12214.83
1999/02/28 13618.27 13740.00
12001.56
1999/03/31 13905.21 13989.98
12068.15
IMATRL PRASUN SHR__CHT 19990331 19990414 143530 R00000000000033
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2000 Fund on October 17, 1996, when the
fund started. As the chart shows, by March 31, 1999 the value of the
investment would have grown to $13,905 - a 39.05% 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 $12,068 - a 20.68% increase. With dividends and capital
gains, if any, reinvested, the same $10,000 investment in the Fidelity
Freedom 2000 Composite Index would have grown to $13,990 - a 39.90%
increase.
(checkmark)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
long-term growth and
short-term volatility. In turn, the
share price and return of a
fund that invests in stocks will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
* LEHMAN BROTHERS AGGREGATE BOND INDEX IS A MARKET VALUE-WEIGHTED
INDEX OF INVESTMENT-GRADE FIXED-RATE DEBT ISSUES, INCLUDING
GOVERNMENT, CORPORATE, ASSET-BACKED, AND MORTGAGE-BACKED SECURITIES,
WITH MATURITIES OF ONE YEAR OR MORE.
FIDELITY FREEDOM 2010 FUND(REGISTERED TRADEMARK)
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 MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2010 12.65% 51.75%
FIDELITY FREEDOM 2010 COMPOSITE 10.25% 51.78%
Wilshire 5000 13.09% 75.75%
MSCI EAFE 6.31% 25.92%
LB Aggregate Bond 6.49% 20.68%
ML High Yield Master 1.94% 21.86%
LB 3 Month T-Bill 5.09% 13.56%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year 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 Fidelity Freedom 2010 Composite Index, a
hypothetical combination of the following unmanaged indices: the
Wilshire 5000 Index, the Morgan Stanley Capital International Europe,
Australasia and Far East (MSCI EAFE) Index, the Lehman Brothers
Aggregate Bond Index, the Merrill Lynch High Yield Master Index, and
the Lehman Brothers 3 Month Treasury Bill Index. The index weightings
are adjusted twice a year to reflect the fund's changing asset
allocations. This benchmark includes reinvested dividends and capital
gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2010 12.65% 18.54%
FIDELITY FREEDOM 2010 COMPOSITE 10.25% 18.55%
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.
$10,000 OVER LIFE OF FUND
Freedom 2010 FID Freedom 2010
S&P 500
00371 F0201
SP001
1996/10/17 10000.00 10000.00
10000.00
1996/10/31 9960.00 9959.84
9982.17
1996/11/30 10430.00 10444.05
10736.72
1996/12/31 10299.25 10343.55
10524.02
1997/01/31 10592.36 10649.72
11181.56
1997/02/28 10602.47 10680.84
11269.23
1997/03/31 10258.82 10368.25
10806.17
1997/04/30 10582.25 10687.21
11451.30
1997/05/31 11099.54 11242.70
12148.46
1997/06/30 11475.28 11652.96
12692.71
1997/07/31 12165.83 12286.92
13702.67
1997/08/31 11749.47 11906.14
12935.04
1997/09/30 12267.38 12433.46
13643.50
1997/10/31 11932.26 12155.35
13187.80
1997/11/30 12145.52 12395.96
13798.27
1997/12/31 12293.47 12578.66
14035.18
1998/01/31 12461.73 12725.89
14190.41
1998/02/28 13071.67 13329.13
15213.83
1998/03/31 13471.28 13766.53
15992.93
1998/04/30 13576.44 13893.36
16153.81
1998/05/31 13404.55 13718.91
15876.13
1998/06/30 13746.61 14037.35
16521.02
1998/07/31 13746.61 13894.84
16345.07
1998/08/31 12346.29 12577.15
13981.90
1998/09/30 12923.52 13081.49
14877.58
1998/10/31 13447.31 13702.92
16087.72
1998/11/30 14024.54 14303.17
17062.80
1998/12/31 14667.60 14869.96
18045.96
1999/01/31 15064.61 15196.38
18800.64
1999/02/28 14711.71 14795.46
18216.32
1999/03/31 15174.90 15178.02
18945.15
IMATRL PRASUN SHR__CHT 19990331 19990414 163803 R00000000000033
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2010 Fund on October 17, 1996, when the
fund started. As the chart shows, by March 31, 1999, the value of the
investment would have grown to $15,175 - a 51.75% increase on the
initial investment. For comparison, look at how the S&P 500(registered
trademark) Index* did over the same period. With dividends and capital
gains, if any, reinvested, the same $10,000 investment would have
grown to $18,945 - an 89.45% increase. With dividends and capital
gains, if any, reinvested, the same $10,000 investment in the Fidelity
Freedom 2010 Composite Index would have grown to $15,178 - a 51.78%
increase.
(checkmark)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
long-term growth and
short-term volatility. In turn, the
share price and return of a
fund that invests in stocks will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
* STANDARD & POOR'S 500 INDEX IS A MARKET CAPITALIZATION-WEIGHTED
INDEX OF COMMON STOCKS.
FIDELITY FREEDOM 2020 FUND(REGISTERED TRADEMARK)
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 MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2020 14.00% 58.93%
FIDELITY FREEDOM 2020 COMPOSITE 10.93% 58.41%
Wilshire 5000 13.09% 75.75%
MSCI EAFE 6.31% 25.92%
LB Aggregate Bond 6.49% 20.68%
ML High Yield Master 1.94% 21.86%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year 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 Fidelity Freedom 2020 Composite Index, a
hypothetical combination of the following unmanaged indices: the
Wilshire 5000 Index, the Morgan Stanley Capital International Europe,
Australasia and Far East (MSCI EAFE) Index, the Lehman Brothers
Aggregate Bond Index, and the Merrill Lynch High Yield Master Index.
The index weightings are adjusted twice a year to reflect the fund's
changing asset allocations. This benchmark includes reinvested
dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2020 14.00% 20.80%
FIDELITY FREEDOM 2020 COMPOSITE 10.93% 20.64%
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.
$10,000 OVER LIFE OF FUND
Freedom 2020 FID Freedom 2020
S&P 500
00372 F0202
SP001
1996/10/17 10000.00 10000.00
10000.00
1996/10/31 9940.00 9933.16
9982.17
1996/11/30 10460.00 10475.04
10736.72
1996/12/31 10329.39 10371.89
10524.02
1997/01/31 10662.27 10725.02
11181.56
1997/02/28 10672.36 10757.63
11269.23
1997/03/31 10299.13 10408.63
10806.17
1997/04/30 10652.18 10758.15
11451.30
1997/05/31 11249.41 11405.38
12148.46
1997/06/30 11685.20 11877.05
12692.71
1997/07/31 12455.43 12588.43
13702.67
1997/08/31 11958.84 12130.06
12935.04
1997/09/30 12566.91 12744.96
13643.50
1997/10/31 12110.86 12354.83
13187.80
1997/11/30 12364.22 12633.76
13798.27
1997/12/31 12523.50 12832.04
14035.18
1998/01/31 12691.46 12986.18
14190.41
1998/02/28 13457.77 13741.24
15213.83
1998/03/31 13940.66 14280.13
15992.93
1998/04/30 14056.13 14424.33
16153.81
1998/05/31 13821.29 14175.93
15876.13
1998/06/30 14225.30 14549.59
16521.02
1998/07/31 14214.67 14361.14
16345.07
1998/08/31 12354.11 12614.35
13981.90
1998/09/30 13002.65 13167.55
14877.58
1998/10/31 13683.08 13971.37
16087.72
1998/11/30 14406.04 14712.01
17062.80
1998/12/31 15237.35 15426.64
18045.96
1999/01/31 15717.96 15825.79
18800.64
1999/02/28 15313.81 15353.07
18216.32
1999/03/31 15892.72 15841.33
18945.15
IMATRL PRASUN SHR__CHT 19990331 19990414 163721 R00000000000033
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2020 Fund on October 17, 1996, when the
fund started. As the chart shows, by March 31, 1999, the value of the
investment would have grown to $15,893 - a 58.93% increase on the
initial investment. For comparison, look at how the S&P 500(registered
trademark) Index* did over the same period. With dividends and capital
gains, if any, reinvested, the same $10,000 investment would have
grown to $18,945 - a 89.45% increase. With dividends and capital
gains, if any, reinvested, the same $10,000 investment in the Fidelity
Freedom 2020 Composite Index would have grown to $15,841 - an 58.41%
increase.
(checkmark)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
long-term growth and
short-term volatility. In turn, the
share price and return of a
fund that invests in stocks will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
* STANDARD & POOR'S 500 INDEX IS A MARKET CAPITALIZATION-WEIGHTED
INDEX OF COMMON STOCKS.
FIDELITY FREEDOM 2030 FUND(REGISTERED TRADEMARK)
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 MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2030 14.29% 60.41%
FIDELITY FREEDOM 2030 COMPOSITE 10.95% 59.05%
Wilshire 5000 13.09% 75.75%
MSCI EAFE 6.31% 25.92%
LB Aggregate Bond 6.49% 20.68%
ML High Yield Master 1.94% 21.86%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year 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 Fidelity Freedom 2030 Composite Index, a
hypothetical combination of the following unmanaged indices: the
Wilshire 5000 Index, the Morgan Stanley Capital International Europe,
Australasia and Far East (MSCI EAFE) Index, the Lehman Brothers
Aggregate Bond Index, and the Merrill Lynch High Yield Master Index.
The index weightings are adjusted twice a year to reflect the fund's
changing asset allocations. This benchmark includes reinvested
dividends and capital gains, if any.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED MARCH 31, 1999 PAST 1 YEAR LIFE OF FUND
FIDELITY FREEDOM 2030 14.29% 21.25%
FIDELITY FREEDOM 2030 COMPOSITE 10.95% 20.83%
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.
$10,000 OVER LIFE OF FUND
Freedom 2030 FID Freedom 2030
S&P 500
00373 F0203
SP001
1996/10/17 10000.00 10000.00
10000.00
1996/10/31 9930.00 9925.17
9982.17
1996/11/30 10460.00 10473.24
10736.72
1996/12/31 10329.39 10373.59
10524.02
1997/01/31 10662.27 10717.74
11181.56
1997/02/28 10682.44 10757.34
11269.23
1997/03/31 10299.13 10412.52
10806.17
1997/04/30 10652.18 10758.65
11451.30
1997/05/31 11289.01 11424.38
12148.46
1997/06/30 11734.10 11910.68
12692.71
1997/07/31 12513.00 12623.01
13702.67
1997/08/31 11997.10 12142.74
12935.04
1997/09/30 12634.39 12774.04
13643.50
1997/10/31 12128.61 12348.46
13187.80
1997/11/30 12381.50 12625.93
13798.27
1997/12/31 12539.75 12824.05
14035.18
1998/01/31 12728.00 12988.81
14190.41
1998/02/28 13522.85 13777.06
15213.83
1998/03/31 14035.31 14335.30
15992.93
1998/04/30 14160.81 14481.95
16153.81
1998/05/31 13910.46 14221.14
15876.13
1998/06/30 14319.91 14598.35
16521.02
1998/07/31 14309.13 14406.06
16345.07
1998/08/31 12272.67 12532.21
13981.90
1998/09/30 12929.94 13069.92
14877.58
1998/10/31 13651.86 13924.04
16087.72
1998/11/30 14438.43 14706.60
17062.80
1998/12/31 15312.95 15453.02
18045.96
1999/01/31 15820.07 15866.53
18800.64
1999/02/28 15401.14 15381.67
18216.32
1999/03/31 16040.56 15904.99
18945.15
IMATRL PRASUN SHR__CHT 19990331 19990414 163637 R00000000000033
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Freedom 2030 Fund on October 17, 1996, when the
fund started. As the chart shows, by March 31, 1999, the value of the
investment would have grown to $16,041 - a 60.41% increase on the
initial investment. For comparison, look at how the S&P 500(registered
trademark) Index* did over the same period. With dividends and capital
gains, if any, reinvested, the same $10,000 investment would have
grown to $18,945 - an 89.45% increase. With dividends and capital
gains, if any, reinvested, the same $10,000 investment in the Fidelity
Freedom 2030 Composite Index would have grown to $15,905 - a 59.05%
increase.
(checkmark)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
long-term growth and
short-term volatility. In turn, the
share price and return of a
fund that invests in stocks will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
* STANDARD & POOR'S 500 INDEX IS A MARKET CAPITALIZATION-WEIGHTED
INDEX OF COMMON STOCKS.
FUND TALK: THE MANAGERS' OVERVIEW
MARKET RECAP
After flirting with the historic five-digit
milestone on three previous trading
sessions, investors celebrated as the
Dow Jones Industrial Average closed
above the 10,000 level for the first
time on March 29. During the
12-month period ended March 31,
1999, most U.S. stock market
indexes approached or set record
highs as the Standard & Poor's 500
Index and the Dow returned 27.34%
and 25.80%, respectively. The lofty
returns of a relatively small number
of large-cap growth stocks, however,
masked the narrow strength of the
market and the lackluster
performance of small-cap stocks. The
majority of equities included in the
broader market indexes posted
negative returns during the past 12
months. As large-cap growth stocks
continued their upward advance late
in the period, signs that the U.S.
economy was continuing to expand
at a fairly strong pace, along with
the improved outlook for overseas
economies, prompted fears of
inflation. In response, investors
pushed down the bond market and
the price of the benchmark 30-year
Treasury Bond. In anticipation of a
potential policy shift at the Federal
Reserve Board from lowering rates to
raising them, the yield on the
30-year Treasury - which moves
in the opposite direction of bond
prices - increased to 5.62% at the
end of the period, from its low of
4.72% in October 1998. U.S.
Treasury prices moved moderately
higher late in the period following
news that the Fed decided to
hold short-term interest rates
unchanged.
(photograph of Scott Stewart)
(photograph of Ren Cheng)
An interview with Scott Stewart (right photo) and Ren Cheng, Portfolio
Managers of Fidelity Freedom Funds
Q. HOW DID THE FUNDS PERFORM, SCOTT?
S.S. Very well. For the 12 months that ended March 31, 1999, the
Income, 2000 and 2010 portfolios returned 8.41%, 10.51% and 12.65%,
respectively. The 2020 and 2030 portfolios returned 14.00% and 14.29%,
respectively, over the same period. Each Freedom Fund compares its
performance to a composite benchmark, which is comprised of various
indexes and reflects the fund's target allocation mix. Over the past
12 months, the composite benchmarks for the Income, 2000 and 2010
portfolios returned 7.67%, 9.11% and 10.25%, respectively. The
composite benchmarks for the 2020 and 2030 portfolios returned 10.93%
and 10.95%, respectively, during the same period.
Q. TURNING TO YOU REN, WHAT FACTORS SHAPED THE FUNDS' PERFORMANCE IN
LIGHT OF MARKET VOLATILITY?
R.C. The funds were tested during the meltdown of last August and they
passed the test, reacting coolly to the volatility. This was by
design. The funds did exactly what they were supposed to do. The
degree of outperformance for the funds increased, as did the risk
level, along the maturity spectrum due to varying degrees of equity
exposure. Since the funds don't engage in market timing, we were able
to keep risk acceptably low for the portfolios. Fixed-income
securities provided the necessary stability for the portfolios, as
equity markets shed gains in the fall. Conversely, when equities
rebounded in the first quarter of 1999, bonds began to decline. This
balance allowed the funds to operate effectively.
Q. WHAT SEGMENTS OF THE MARKET INFLUENCED PERFORMANCE?
R.C. Fund holdings in domestic equities in the portfolios' underlying
Fidelity mutual funds - such as Blue Chip Growth and Fidelity Fund -
that were focused on large-cap, growth-oriented stocks, were the real
stars during the period. Value funds - such as Equity-Income and
Disciplined Equity - lagged their respective benchmarks. Extreme
volatility in the marketplace caused investors to turn their backs on
out-of-favor value-oriented stocks and embrace the predictable
earnings growers. This swing contributed to the widening performance
disparity between large-cap stocks and small- to mid-cap stocks
throughout the period. On the international side of the underlying
Fidelity funds, performance was mixed. Overseas and Diversified
International trailed the Morgan Stanley Capital International Europe,
Australasia and Far East Index - due to the surprising strength of the
Japanese market, to which we had limited exposure relative to the
benchmark. While the Japan Fund advanced, the Southeast Asia and
Europe portfolios declined for the same period. Underperformance among
fixed-income securities was isolated to the underlying Fidelity funds'
exposure to credit spread securities - such as corporates, mortgages
and asset-backed securities - which lagged in the fall. On a positive
note, Capital & Income outpaced the high-yield benchmark index due to
superior credit research.
Q. GIVEN THE PERIOD'S VOLATILITY, COULD YOU EXPLAIN YOUR
ASSET-ALLOCATION STRATEGY?
R.C. The portfolios are managed using a downside-risk minimization
model. Asset allocation is determined based on the long-term
historical behavior of the underlying asset classes. We do not make
market-timing bets. It is important to follow the target asset
allocation and allow the built-in diversification to neutralize market
instability. If you attempt to time the market, more often than not
you will be making moves at precisely the wrong times. History has
shown that the right "structure," i.e. asset allocation, yields over
80% of your total return over a long period of time.
Q. FREEDOM FUNDS' ASSETS GREW APPRECIABLY OVER THE PAST 12 MONTHS. TO
WHAT DO YOU ATTRIBUTE THE STRONG INFLOWS?
R.C. This trend may be due to the fact that a lot of people today
want help with their investments; they're looking for easy-to-use,
diversified products that are professionally managed. Understandably,
the Freedom Funds fit that mold. Specifically, retirement plan
sponsors have rallied around the funds' predictability and
consistency, seeing them as well suited for retirement savings. They
offer an alternative to index funds, with added diversification - an
attractive product for retirement investors.
Q. WHAT'S YOUR OUTLOOK?
R.C. I do not expect volatility to subside any time soon. I feel that
interest rates should remain reasonably steady with inflation
relativity contained. I think that large-cap stocks should do well in
a low inflation environment. With the absence of pricing power, market
share will ultimately drive growth. In terms of the funds' long-term
strategy, we'll gradually reallocate each Freedom Fund's target
investment mix over the coming months. The table below illustrates the
target mix we'd like to achieve for each fund by the next time we
address our shareholders on September 30, 1999.
INCOME 2000 2010 2020 2030
Domestic Equity Funds 20.0% 33.5% 49.4% 64.4% 70.0%
International Equity Funds - 3.4% 7.4% 11.1% 13.7%
Inv. Grade Fixed-Income Funds 40.0% 39.3% 31.8% 17.0% 7.6%
High Yield Fixed-Income Funds - 3.2% 6.2% 7.5% 8.7%
Money Market Funds 40.0% 20.6% 5.2% - -
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 AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
REFLECTING THE CHANGES TO THE TARGET INVESTMENT MIXES DESCRIBED ABOVE,
EACH FUND'S COMPOSITE BENCHMARK WILL CHANGE ITS ALLOCATION AS OF JUNE
30, 1999. THE TABLE BELOW ILLUSTRATES THESE CHANGES.
COMPOSITE BENCHMARKS
INCOME 2000 2010 2020 2030
Wilshire 5000 20.0% 33.7% 50.2% 64.7% 69.8%
MSCI EAFE - 3.4% 7.6% 11.4% 13.9%
LB Aggregate Bond 40.0% 39.8% 31.1% 16.3% 7.4%
ML High Yield Master - 3.3% 6.3% 7.6% 8.9%
LB 3 Month T-Bill 40.0% 19.8% 4.8% - -
(checkmark)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 underlying
Fidelity equity,
fixed-income and money
market funds.
FUND NUMBERS: Income (369);
2000 (370); 2010 (371);
2020 (372); 2030 (373)
SIZE: as of March 31, 1999,
more than $197 million
(Income); $563 million
(2000); $1.0 billion
(2010); $994 million
(2020); $365 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, 1993- January 1999;
founder and head of Fidelity's
Structured Equity Group, since
1987; joined Fidelity in 1987
REN CHENG ON
MANAGING RISK:
"Investors shouldn't buy Freedom
Funds for short-term speculation.
This is not the best reason to buy
these products, and I suggest that
they consider other alternatives.
What the Freedom Funds do offer
is a self-contained lifetime
investment program that
effectively lifts the burden off of
shareholders as we carefully
manage risk for them. We seek to
use fixed asset allocation over
time to anchor the portfolio's risk.
By investing in underlying Fidelity
funds, we are able to add value
over time by leveraging Fidelity's
strong suit - fundamental stock
research. We have found that by
exposing the funds to what
Fidelity is good at - risk
control/stock picking - we are
able to provide an effective
formula for the investor. Because
of automatic built-in
diversification, even amid the
market's worst days and in the
most aggressive Freedom Fund,
the loss is contained. So, on the
whole, our investors should
expect to see a lot of singles and
doubles, and from time to time, a
triple, but seldom, if ever, a
strike out. This is intentional.
The objective is to get on base
safely at all times. This makes for
a winning scenario."
FIDELITY FREEDOM INCOME FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF MARCH 31, 1999
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS IN
THESE HOLDINGS 6 MONTHS AGO
DOMESTIC EQUITY FUNDS
Blue Chip Growth Fund 2.9% 2.9%
Disciplined Equity Fund 3.0 2.9
Equity-Income Fund 2.9 2.9
Fidelity Fund 3.0 2.9
Growth & Income Portfolio 2.9 3.0
Growth Company Fund 3.0 3.0
OTC Portfolio 2.0 2.0
19.7 19.6
INVESTMENT GRADE FIXED-INCOME
FUNDS
Government Income Fund 15.1 15.3
Intermediate Bond Fund 9.9 10.0
Investment Grade Bond Fund 15.2 15.2
40.2 40.5
MONEY MARKET FUND
Fidelity Money Market Trust: 40.1 39.9
Retirement Money Market
Portfolio
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
Row: 1, Col: 1, Value: 39.9
Row: 1, Col: 2, Value: 40.5
Row: 1, Col: 3, Value: 19.6
19.6%
39.9%
40.5%
CURRENT
Row: 1, Col: 1, Value: 40.1
Row: 1, Col: 2, Value: 40.2
Row: 1, Col: 3, Value: 19.7
19.7%
40.1%
40.2%
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
SEPTEMBER 30, 1998. THE CURRENT ALLOCATION IS BASED ON THE FUND'S
HOLDINGS AS OF MARCH 31, 1999. THE EXPECTED ALLOCATION REPRESENTS THE
FUND'S ANTICIPATED TARGET ASSET ALLOCATION AT SEPTEMBER 30, 1999.
FIDELITY FREEDOM INCOME FUND
INVESTMENTS MARCH 31, 1999
Showing Percentage of Total Value of Investment in Securities
EQUITY FUNDS - 19.7%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 19.7%
Blue Chip Growth Fund 109,324 $ 5,823,708
Disciplined Equity Fund 190,168 5,849,559
Equity-Income Fund 103,991 5,815,168
Fidelity Fund 150,685 5,837,530
Growth & Income Portfolio 124,680 5,815,070
Growth Company Fund 105,609 5,824,350
OTC Portfolio 80,622 3,862,623
TOTAL EQUITY FUNDS 38,828,008
(Cost $32,482,832)
FIXED-INCOME FUNDS - 40.2%
INVESTMENT GRADE FIXED-INCOME
FUNDS - 40.2%
Government Income Fund 3,032,952 29,935,237
Intermediate Bond Fund 1,926,753 19,575,808
Investment Grade Bond Fund 4,126,862 29,961,019
TOTAL FIXED-INCOME FUNDS 79,472,064
(Cost $80,206,934)
MONEY MARKET FUND - 40.1%
Fidelity Money Market Trust: 79,313,823 79,313,823
Retirement Money Market
Portfolio (Cost $79,313,823)
TOTAL INVESTMENT IN $ 197,613,895
SECURITIES - 100%
(Cost $192,003,589)
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$174,916,302 and $36,705,552, respectively.
INCOME TAX INFORMATION
At March 31, 1999, the aggregate cost of investment securities for
income tax purposes was $192,624,279. Net unrealized appreciation
aggregated $4,989,616, of which $5,928,740 related to appreciated
investment securities and $939,124 related to depreciated investment
securities.
The fund hereby designates approximately $762,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FIDELITY FREEDOM INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
ASSETS
Investment in securities, at $ 197,613,895
value (cost $192,003,589) -
See accompanying schedule
Cash 23,661
Receivable for Freedom Fund 719,200
shares sold
Dividends receivable 677,303
TOTAL ASSETS 199,034,059
LIABILITIES
Payable for underlying fund $ 1,081,774
shares purchased
Payable for Freedom Fund 301,939
shares redeemed
Accrued management fee 12,806
TOTAL LIABILITIES 1,396,519
NET ASSETS $ 197,637,540
Net Assets consist of:
Paid in capital $ 190,812,766
Undistributed net investment 752,770
income
Accumulated undistributed net 461,698
realized gain (loss) on
investments
Net unrealized appreciation 5,610,306
(depreciation) on investments
NET ASSETS, for 17,566,319 $ 197,637,540
shares outstanding
NET ASSET VALUE, offering $11.25
price and redemption price
per share ($197,637,540
(divided by) 17,566,319
shares)
STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 1999
INVESTMENT INCOME $ 5,798,469
Income distributions from
underlying funds
Interest 964
TOTAL INCOME 5,799,433
EXPENSES
Management fee $ 126,861
Non-interested trustees' 406
compensation
Total expenses before 127,267
reductions
Expense reductions (35,104) 92,163
NET INVESTMENT INCOME 5,707,270
REALIZED AND UNREALIZED GAIN (544,876)
(LOSS)
Realized gain (loss) on sale
of underlying fund shares
Capital gain distributions 1,690,269 1,145,393
from underlying funds
Change in net unrealized 4,467,050
appreciation (depreciation)
on investment securities
NET GAIN (LOSS) 5,612,443
NET INCREASE (DECREASE) IN $ 11,319,713
NET ASSETS RESULTING FROM
OPERATIONS
OTHER INFORMATION
Expense reductions $ 24,831
Reimbursement from
investment adviser
Transfer agent credits 10,273
$ 35,104
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MARCH 31, 1999 YEAR ENDED MARCH 31, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net investment $ 5,707,270 $ 1,148,921
income
Net realized gain (loss) 1,145,393 834,555
Change in net unrealized 4,467,050 1,304,056
appreciation (depreciation)
NET INCREASE (DECREASE) IN 11,319,713 3,287,532
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (5,362,025) (1,139,587)
From net investment income
From net realized gain (1,020,486) (147,075)
TOTAL DISTRIBUTIONS (6,382,511) (1,286,662)
Share transactions Net 277,936,617 69,897,635
proceeds from sales of
Freedom Fund shares
Reinvestment of distributions 6,288,639 1,274,256
Cost of Freedom Fund shares (146,997,230) (27,126,984)
redeemed
NET INCREASE (DECREASE) IN 137,228,026 44,044,907
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) 142,165,228 46,045,777
IN NET ASSETS
NET ASSETS
Beginning of period 55,472,312 9,426,535
End of period (including $ 197,637,540 $ 55,472,312
undistributed net investment
income of $752,770 and
$189,484, respectively)
OTHER INFORMATION
Shares
Sold 25,277,092 6,546,429
Issued in reinvestment of 571,496 120,112
distributions
Redeemed (13,347,804) (2,537,779)
Net increase (decrease) 12,500,784 4,128,762
</TABLE>
FINANCIAL HIGHLIGHTS
YEARS ENDED MARCH 31, 1999 1998 1997 E
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 10.95 $ 10.06 $ 10.00
period
Income from Investment
Operations
Net investment income D .49 .50 .22
Net realized and unrealized .40 .96 (.02)
gain (loss)
Total from investment .89 1.46 .20
operations
Less Distributions
From net investment income (.47) (.51) (.14)
From net realized gain (.12) (.06) -
Total distributions (.59) (.57) (.14)
Net asset value, end of period $ 11.25 $ 10.95 $ 10.06
TOTAL RETURN B, C 8.41% 14.88% 1.99%
RATIOS AND SUPPLEMENTAL DATA
(amounts do not include the
activity of the underlying
funds)
Net assets, end of period $ 197,638 $ 55,472 $ 9,427
(000 omitted)
Ratio of expenses to average .08% F .08% F .08% A, F
net assets
Ratio of expenses to average .07% G .08% .08% A
net assets after expense
reductions
Ratio of net investment 4.46% 4.71% 4.95% A
income to average net assets
Portfolio turnover rate 29% 33% 32% A
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.
D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
E FOR THE PERIOD OCTOBER 17, 1996 (COMMENCEMENT OF OPERATIONS) TO
MARCH 31, 1997.
F STRATEGIC ADVISORS 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.
G STRATEGIC ADVISORS OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES.
FIDELITY FREEDOM 2000 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF MARCH 31, 1999
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS IN
THESE HOLDINGS 6 MONTHS AGO
DOMESTIC EQUITY FUNDS
Blue Chip Growth Fund 5.1% 5.3%
Disciplined Equity Fund 5.1 5.3
Equity-Income Fund 5.0 5.3
Fidelity Fund 5.1 5.2
Growth & Income Portfolio 5.1 5.3
Growth Company Fund 5.1 5.4
OTC Portfolio 3.4 3.6
33.9 35.4
INTERNATIONAL EQUITY FUNDS
Diversified International Fund 0.9 0.9
Europe Fund 1.2 1.2
Japan Fund 0.3 0.3
Overseas Fund 0.9 0.9
Southeast Asia Fund 0.1 0.2
3.4 3.5
INVESTMENT GRADE FIXED-INCOME
FUNDS
Government Income Fund 15.2 15.5
Intermediate Bond Fund 10.0 10.0
Investment Grade Bond Fund 15.2 15.4
40.4 40.9
HIGH YIELD FIXED-INCOME FUND
Capital & Income Fund 3.3 3.5
MONEY MARKET FUND
Fidelity Money Market Trust: 19.0 16.7
Retirement Money Market
Portfolio
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
Row: 1, Col: 1, Value: 16.7
Row: 1, Col: 2, Value: 3.5
Row: 1, Col: 3, Value: 40.9
Row: 1, Col: 4, Value: 3.5
Row: 1, Col: 5, Value: 35.4
16.7% (MM)
35.4% (DE)
3.5% (HY)
3.5% (IE)
40.9% (IG)
CURRENT
Row: 1, Col: 1, Value: 19.0
Row: 1, Col: 2, Value: 3.3
Row: 1, Col: 3, Value: 40.4
Row: 1, Col: 4, Value: 3.4
Row: 1, Col: 5, Value: 33.9
19.0% (MM)
33.9% (DE)
3.3% (HY)
40.4% (IG)
3.4% (IE)
Equity
DE = Domestic Equity funds
IE = International Equity funds
EXPECTED
Fixed-income
IG = Investment Grade funds
HY = High Yield fund
Row: 1, Col: 1, Value: 20.6
Row: 1, Col: 2, Value: 3.2
Row: 1, Col: 3, Value: 39.3
Row: 1, Col: 4, Value: 3.4
Row: 1, Col: 5, Value: 33.5
20.6% (MM)
33.5% (DE)
3.2% (HY)
39.3% (IG)
3.4% (IE)
Money Market fund (MM)
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 SEPTEMBER 30, 1998.
THE CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31,
1999. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT SEPTEMBER 30, 1999.
FIDELITY FREEDOM 2000 FUND
INVESTMENTS MARCH 31, 1999
Showing Percentage of Total Value of Investment in Securities
<TABLE>
<CAPTION>
<S> <C> <C> <C>
EQUITY FUNDS - 37.3%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 33.9%
Blue Chip Growth Fund 538,177 $ 28,668,663
Disciplined Equity Fund 934,850 28,755,981
Equity-Income Fund 511,197 28,586,142
Fidelity Fund 741,630 28,730,757
Growth & Income Portfolio 613,232 28,601,150
Growth Company Fund 520,674 28,715,168
OTC Portfolio 397,111 19,025,569
191,083,430
INTERNATIONAL EQUITY FUNDS -
3.4%
Diversified International Fund 264,907 4,821,306
Europe Fund 208,142 6,795,850
Japan Fund 151,167 1,934,940
Overseas Fund 130,087 4,811,908
Southeast Asia Fund 107,972 958,789
19,322,793
TOTAL EQUITY FUNDS 210,406,223
(Cost $174,239,771)
FIXED-INCOME FUNDS - 43.7%
HIGH YIELD FIXED-INCOME FUND
- - 3.3%
Capital & Income Fund 1,860,072 18,265,910
INVESTMENT GRADE FIXED-INCOME
FUNDS - 40.4%
Government Income Fund 8,700,792 85,876,814
Intermediate Bond Fund 5,524,602 56,129,954
Investment Grade Bond Fund 11,829,247 85,880,331
227,887,099
TOTAL FIXED-INCOME FUNDS 246,153,009
(Cost $247,977,527)
MONEY MARKET FUND - 19.0%
Fidelity Money Market Trust: 107,120,146 107,120,146
Retirement Money Market
Portfolio (Cost $107,120,146)
CASH EQUIVALENTS - 0.0%
MATURITY AMOUNT VALUE (NOTE 1)
Investments in repurchase $ 38,005 $ 38,000
agreements (U.S. Treasury
obligations), in a joint
trading account at 4.92%,
dated 3/31/99 due 4/1/99
TOTAL INVESTMENT IN $ 563,717,378
SECURITIES - 100%
(Cost $529,375,444)
</TABLE>
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$332,582,021 and $113,828,556, respectively.
INCOME TAX INFORMATION
At March 31, 1999, the aggregate cost of investment securities for
income tax purposes was $532,079,744. Net unrealized appreciation
aggregated $31,637,634, of which $34,680,565 related to appreciated
investment securities and $3,042,931 related to depreciated investment
securities.
The fund hereby designates approximately $4,460,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FIDELITY FREEDOM 2000 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
ASSETS
Investment in securities, at $ 563,717,378
value (including repurchase
agreements of $38,000) (cost
$529,375,444) - See
accompanying schedule
Cash 292
Receivable for Freedom Fund 1,555,102
shares sold
Dividends receivable 1,572,620
TOTAL ASSETS 566,845,392
LIABILITIES
Payable for underlying fund $ 2,526,485
shares purchased
Payable for Freedom Fund 564,646
shares redeemed
Accrued management fee 36,629
TOTAL LIABILITIES 3,127,760
NET ASSETS $ 563,717,632
Net Assets consist of:
Paid in capital $ 520,427,449
Undistributed net investment 4,771,097
income
Accumulated undistributed net 4,177,152
realized gain (loss) on
investments
Net unrealized appreciation 34,341,934
(depreciation) on investments
NET ASSETS, for 44,729,566 $ 563,717,632
shares outstanding
NET ASSET VALUE, offering $12.60
price and redemption price
per share ($563,717,632
(divided by) 44,729,566
shares)
STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 1999
INVESTMENT INCOME $ 16,406,157
Income distributions from
underlying funds
Interest 1,030
TOTAL INCOME 16,407,187
EXPENSES
Management fee $ 426,588
Non-interested trustees' 1,433
compensation
Total expenses before 428,021
reductions
Expense reductions (133,430) 294,591
NET INVESTMENT INCOME 16,112,596
REALIZED AND UNREALIZED GAIN
(LOSS)
Realized gain (loss) on sale (1,329,219)
of underlying fund shares
Capital gain distributions 10,278,474 8,949,255
from underlying funds
Change in net unrealized 21,119,190
appreciation (depreciation)
on investment securities
NET GAIN (LOSS) 30,068,445
NET INCREASE (DECREASE) IN $ 46,181,041
NET ASSETS RESULTING FROM
OPERATIONS
OTHER INFORMATION
Expense reductions
Reimbursement from $ 85,083
investment adviser
Custodian credits 37
Transfer agent credits 48,310
$ 133,430
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MARCH 31, 1999 YEAR ENDED MARCH 31, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net investment $ 16,112,596 $ 3,425,458
income
Net realized gain (loss) 8,949,255 4,861,844
Change in net unrealized 21,119,190 13,600,251
appreciation (depreciation)
NET INCREASE (DECREASE) IN 46,181,041 21,887,553
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (14,832,976) (2,016,719)
From net investment income
From net realized gain (6,958,244) (723,870)
TOTAL DISTRIBUTIONS (21,791,220) (2,740,589)
Share transactions Net 485,624,589 361,047,372
proceeds from sales of
Freedom Fund shares
Reinvestment of distributions 21,766,208 2,734,857
Cost of Freedom Fund shares (293,188,489) (73,749,351)
redeemed
NET INCREASE (DECREASE) IN 214,202,308 290,032,878
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) 238,592,129 309,179,842
IN NET ASSETS
NET ASSETS
Beginning of period 325,125,503 15,945,661
End of period (including $ 563,717,632 $ 325,125,503
undistributed net investment
income of $4,771,097 and
$2,284,423, respectively)
OTHER INFORMATION
Shares
Sold 40,067,493 31,728,940
Issued in reinvestment of 1,786,671 246,530
distributions
Redeemed (24,267,906) (6,408,111)
Net increase (decrease) 17,586,258 25,567,359
</TABLE>
FINANCIAL HIGHLIGHTS
YEARS ENDED MARCH 31, 1999 1998 1997 E
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 11.98 $ 10.12 $ 10.00
period
Income from Investment
Operations
Net investment income D .45 .60 .18
Net realized and unrealized .78 1.71 .03
gain (loss)
Total from investment 1.23 2.31 .21
operations
Less Distributions
From net investment income (.40) (.33) (.09)
From net realized gain (.21) (.12) -
Total distributions (.61) (.45) (.09)
Net asset value, end of period $ 12.60 $ 11.98 $ 10.12
TOTAL RETURN B, C 10.51% 23.25% 2.09%
RATIOS AND SUPPLEMENTAL DATA
(amounts do not include the
activity of the underlying
funds)
Net assets, end of period $ 563,718 $ 325,126 $ 15,946
(000 omitted)
Ratio of expenses to average .08% F .08% F .08% A, F
net assets
Ratio of expenses to average .07% G .08% .08% A
net assets after expense
reductions
Ratio of net investment 3.76% 3.72% 4.00% A
income to average net assets
Portfolio turnover rate 27% 24% 19% A
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.
D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
E FOR THE PERIOD OCTOBER 17, 1996 (COMMENCEMENT OF OPERATIONS) TO
MARCH 31, 1997.
F 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.
G STRATEGIC ADVISERS OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES.
FIDELITY FREEDOM 2010 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF MARCH 31, 1999
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS IN
THESE HOLDINGS 6 MONTHS AGO
DOMESTIC EQUITY FUNDS
Blue Chip Growth Fund 7.6% 7.9%
Disciplined Equity Fund 7.7 7.9
Equity-Income Fund 7.6 7.9
Fidelity Fund 7.7 7.9
Growth & Income Portfolio 7.6 8.0
Growth Company Fund 7.6 8.1
OTC Portfolio 5.1 5.5
50.9 53.2
INTERNATIONAL EQUITY FUNDS
Diversified International Fund 2.0 2.0
Europe Fund 2.8 2.7
Japan Fund 0.8 0.8
Overseas Fund 1.9 2.0
Southeast Asia Fund 0.4 0.4
7.9 7.9
INVESTMENT GRADE FIXED-INCOME
FUNDS
Government Income Fund 11.4 11.0
Intermediate Bond Fund 7.5 7.1
Investment Grade Bond Fund 11.5 10.9
30.4 29.0
HIGH YIELD FIXED-INCOME FUND
Capital & Income Fund 6.5 6.7
MONEY MARKET FUND
Fidelity Money Market Trust: 4.3 3.2
Retirement Money Market
Portfolio
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
Row: 1, Col: 1, Value: 3.2
Row: 1, Col: 2, Value: 6.7
Row: 1, Col: 3, Value: 29.0
Row: 1, Col: 4, Value: 7.9
Row: 1, Col: 5, Value: 53.2
3.2% (MM)
6.7% (HY)
29.0% (IG)
53.2% (DE)
7.9% (IE)
CURRENT
Row: 1, Col: 1, Value: 4.3
Row: 1, Col: 2, Value: 6.5
Row: 1, Col: 3, Value: 30.4
Row: 1, Col: 4, Value: 7.9
Row: 1, Col: 5, Value: 50.9
4.3% (MM)
6.5% (HY)
30.4% (IG)
50.9% (DE)
7.9% (IE)
Equity
DE = Domestic Equity funds
IE = International Equity funds
EXPECTED
5.2% (MM)
Fixed-income
IG = Investment Grade funds
HY = High Yield fund
Row: 1, Col: 1, Value: 5.2
Row: 1, Col: 2, Value: 6.2
Row: 1, Col: 3, Value: 31.8
Row: 1, Col: 4, Value: 7.4
Row: 1, Col: 5, Value: 49.4
6.2% (HY)
49.4% (DE)
31.8% (IG)
7.4% (IE)
Money Market fund (MM)
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 SEPTEMBER 30, 1998.
THE CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31,
1999. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT SEPTEMBER 30, 1999.
FIDELITY FREEDOM 2010 FUND
INVESTMENTS MARCH 31, 1999
Showing Percentage of Total Value of Investment in Securities
<TABLE>
<CAPTION>
<S> <C> <C> <C>
EQUITY FUNDS - 58.8%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 50.9%
Blue Chip Growth Fund 1,561,368 $ 83,174,058
Disciplined Equity Fund 2,711,835 83,416,041
Equity-Income Fund 1,484,174 82,994,997
Fidelity Fund 2,152,740 83,397,131
Growth & Income Portfolio 1,781,027 83,067,092
Growth Company Fund 1,509,561 83,252,280
OTC Portfolio 1,152,461 55,214,420
554,516,019
INTERNATIONAL EQUITY FUNDS -
7.9%
Diversified International Fund 1,177,702 21,434,169
Europe Fund 922,004 30,103,419
Japan Fund 668,696 8,559,309
Overseas Fund 577,578 21,364,592
Southeast Asia Fund 493,148 4,379,158
85,840,647
TOTAL EQUITY FUNDS 640,356,666
(Cost $537,509,314)
FIXED-INCOME FUNDS - 36.9%
HIGH YIELD FIXED-INCOME FUND
- - 6.5%
Capital & Income Fund 7,221,523 70,915,355
INVESTMENT GRADE FIXED-INCOME
FUNDS - 30.4%
Government Income Fund 12,605,407 124,415,366
Intermediate Bond Fund 8,011,535 81,397,192
Investment Grade Bond Fund 17,144,843 124,471,560
330,284,118
TOTAL FIXED-INCOME FUNDS 401,199,473
(Cost $403,414,012)
MONEY MARKET FUND - 4.3%
Fidelity Money Market Trust: 47,264,932 47,264,932
Retirement Money Market
Portfolio (Cost $47,264,932)
CASH EQUIVALENTS - 0.0%
MATURITY AMOUNT VALUE (NOTE 1)
Investments in repurchase $ 121,017 $ 121,000
agreements (U.S. Treasury
obligations), in a joint
trading account at 4.92%,
dated 3/31/99 due 4/1/99
TOTAL INVESTMENT IN $ 1,088,942,071
SECURITIES - 100%
(Cost $988,309,258)
</TABLE>
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$604,773,805 and $217,156,915, respectively.
INCOME TAX INFORMATION
At March 31, 1999, the aggregate cost of investment securities for
income tax purposes was $994,208,813. Net unrealized appreciation
aggregated $94,733,258, of which $100,306,306 related to appreciated
investment securities and $5,573,048 related to depreciated investment
securities.
The fund hereby designates approximately $13,001,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FIDELITY FREEDOM 2010 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
ASSETS
Investment in securities, at $ 1,088,942,071
value (including repurchase
agreements of $121,000)
(cost $988,309,258) - See
accompanying schedule
Cash 158
Receivable for Freedom Fund 2,334,200
shares sold
Dividends receivable 2,053,474
TOTAL ASSETS 1,093,329,903
LIABILITIES
Payable for underlying fund $ 3,229,749
shares purchased
Payable for Freedom Fund 1,120,778
shares redeemed
Accrued management fee 70,113
TOTAL LIABILITIES 4,420,640
NET ASSETS $ 1,088,909,263
Net Assets consist of:
Paid in capital $ 969,998,056
Undistributed net investment 5,470,634
income
Accumulated undistributed net 12,807,760
realized gain (loss) on
investments and foreign
currency transactions
Net unrealized appreciation 100,632,813
(depreciation) on investments
NET ASSETS, for 79,132,760 $ 1,088,909,263
shares outstanding
NET ASSET VALUE, offering $13.76
price and redemption price
per share ($1,088,909,263
(divided by) 79,132,760
shares)
STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 1999
INVESTMENT INCOME $ 22,966,895
Income distributions from
underlying funds
Interest 1,668
TOTAL INCOME 22,968,563
EXPENSES
Management fee $ 792,500
Non-interested trustees' 2,662
compensation
Total expenses before 795,162
reductions
Expense reductions (227,697) 567,465
NET INVESTMENT INCOME 22,401,098
REALIZED AND UNREALIZED GAIN
(LOSS)
Realized gain (loss) on sale (4,531,586)
of underlying fund shares
Capital gain distributions 28,546,794 24,015,208
from underlying funds
Change in net unrealized 58,372,346
appreciation (depreciation)
on investment securities
NET GAIN (LOSS) 82,387,554
NET INCREASE (DECREASE) IN $ 104,788,652
NET ASSETS RESULTING FROM
OPERATIONS
OTHER INFORMATION
Expense reductions $ 158,244
Reimbursement from
investment adviser
Transfer agent credits 69,453
$ 227,697
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MARCH 31, 1999 YEAR ENDED MARCH 31, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net investment $ 22,401,098 $ 4,091,090
income
Net realized gain (loss) 24,015,208 10,665,475
Change in net unrealized 58,372,346 42,914,286
appreciation (depreciation)
NET INCREASE (DECREASE) IN 104,788,652 57,670,851
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (22,500,156) (3,427,770)
From net investment income
From net realized gain (16,254,418) (831,579)
TOTAL DISTRIBUTIONS (38,754,574) (4,259,349)
Share transactions Net 623,553,298 632,743,131
proceeds from sales of
Freedom Fund shares
Reinvestment of distributions 38,733,842 4,255,727
Cost of Freedom Fund shares (286,768,408) (66,653,573)
redeemed
NET INCREASE (DECREASE) IN 375,518,732 570,345,285
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) 441,552,810 623,756,787
IN NET ASSETS
NET ASSETS
Beginning of period 647,356,453 23,599,666
End of period (including $ 1,088,909,263 $ 647,356,453
undistributed net investment
income of $5,470,634 and
$2,560,461, respectively)
OTHER INFORMATION
Shares
Sold 47,946,684 53,347,199
Issued in reinvestment of 2,955,502 370,207
distributions
Redeemed (22,294,089) (5,517,029)
Net increase (decrease) 28,608,097 48,200,377
</TABLE>
FINANCIAL HIGHLIGHTS
YEARS ENDED MARCH 31, 1999 1998 1997 E
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 12.81 $ 10.15 $ 10.00
period
Income from Investment
Operations
Net investment income D .36 .30 .11
Net realized and unrealized 1.22 2.82 .15
gain (loss)
Total from investment 1.58 3.12 .26
operations
Less Distributions
From net investment income (.35) (.37) (.11)
From net realized gain (.28) (.09) -
Total distributions (.63) (.46) (.11)
Net asset value, end of period $ 13.76 $ 12.81 $ 10.15
TOTAL RETURN B, C 12.65% 31.31% 2.59%
RATIOS AND SUPPLEMENTAL DATA
(amounts do not include the
activity of the underlying
funds)
Net assets, end of period $ 1,088,909 $ 647,356 $ 23,600
(000 omitted)
Ratio of expenses to average .08% F .08% F .08% A, F
net assets
Ratio of expenses to average .07% G .08% .08% A
net assets after expense
reductions
Ratio of net investment 2.82% 2.54% 2.56% A
income to average net assets
Portfolio turnover rate 27% 20% 3% A
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.
D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
E FOR THE PERIOD OCTOBER 17, 1996 (COMMENCEMENT OF OPERATIONS) TO
MARCH 31, 1997.
F 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.
G STRATEGIC ADVISERS OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES.
FIDELITY FREEDOM 2020 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF MARCH 31, 1999
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS IN
THESE HOLDINGS 6 MONTHS AGO
DOMESTIC EQUITY FUNDS
Blue Chip Growth Fund 9.8% 10.0%
Disciplined Equity Fund 9.8 9.9
Equity-Income Fund 9.7 10.0
Fidelity Fund 9.8 9.8
Growth & Income Portfolio 9.7 10.1
Growth Company Fund 9.8 10.2
OTC Portfolio 6.5 6.8
65.1 66.8
INTERNATIONAL EQUITY FUNDS
Diversified International Fund 2.9 2.9
Europe Fund 4.0 3.9
Japan Fund 1.2 1.1
Overseas Fund 2.9 2.9
Southeast Asia Fund 0.6 0.5
11.6 11.3
INVESTMENT GRADE FIXED-INCOME
FUNDS
Government Income Fund 5.9 5.4
Intermediate Bond Fund 3.8 3.5
Investment Grade Bond Fund 5.9 5.3
15.6 14.2
HIGH YIELD FIXED-INCOME FUND
Capital & Income Fund 7.7 7.7
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
Row: 1, Col: 1, Value: 7.7
Row: 1, Col: 2, Value: 14.2
Row: 1, Col: 3, Value: 11.3
Row: 1, Col: 4, Value: 66.8
7.7% (HY)
14.2% (IG)
66.8% (DE)
11.3% (IE)
CURRENT
Row: 1, Col: 1, Value: 7.7
Row: 1, Col: 2, Value: 15.6
Row: 1, Col: 3, Value: 11.6
Row: 1, Col: 4, Value: 65.09999999999999
7.7% (HY)
65.1% (DE)
15.6% (IG)
11.6% (IE)
Equity
DE = Domestic Equity funds
IE = International Equity funds
EXPECTED
Fixed-income
IG = Investment Grade funds
HY = High Yield fund
Row: 1, Col: 1, Value: 7.5
Row: 1, Col: 2, Value: 17.0
Row: 1, Col: 3, Value: 11.1
Row: 1, Col: 4, Value: 64.40000000000001
7.5% (HY)
17.0% (IG)
64.4% (DE)
11.1% (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 SEPTEMBER 30, 1998.
THE CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31,
1999. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT SEPTEMBER 30, 1999.
FIDELITY FREEDOM 2020 FUND
INVESTMENTS MARCH 31, 1999
Showing Percentage of Total Value of Investment in Securities
<TABLE>
<CAPTION>
<S> <C> <C> <C>
EQUITY FUNDS - 76.7%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 65.1%
Blue Chip Growth Fund 1,825,035 $ 97,219,594
Disciplined Equity Fund 3,170,915 97,537,334
Equity-Income Fund 1,735,096 97,026,558
Fidelity Fund 2,515,302 97,442,785
Growth & Income Portfolio 2,080,346 97,027,350
Growth Company Fund 1,765,102 97,345,385
OTC Portfolio 1,346,074 64,490,415
648,089,421
INTERNATIONAL EQUITY FUNDS -
11.6%
Diversified International Fund 1,574,951 28,664,114
Europe Fund 1,234,868 40,318,438
Japan Fund 900,479 11,526,127
Overseas Fund 775,409 28,682,371
Southeast Asia Fund 655,399 5,819,942
115,010,992
TOTAL EQUITY FUNDS 763,100,413
(Cost $643,569,963)
FIXED-INCOME FUNDS - 23.3%
HIGH YIELD FIXED-INCOME FUND
- - 7.7%
Capital & Income Fund 7,748,590 76,091,153
INVESTMENT GRADE FIXED-INCOME
FUNDS - 15.6%
Government Income Fund 5,926,435 58,493,912
Intermediate Bond Fund 3,769,111 38,294,166
Investment Grade Bond Fund 8,066,123 58,560,055
155,348,133
TOTAL FIXED-INCOME FUNDS 231,439,286
(Cost $232,479,604)
CASH EQUIVALENTS - 0.0%
MATURITY AMOUNT VALUE (NOTE 1)
Investments in repurchase $ 110,015 $ 110,000
agreements (U.S. Treasury
obligations), in a joint
trading account at 4.92%,
dated 3/31/99 due 4/1/99
TOTAL INVESTMENT IN $ 994,649,699
SECURITIES - 100%
(Cost $876,159,567)
</TABLE>
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$484,664,363 and $134,679,273, respectively.
INCOME TAX INFORMATION
At March 31, 1999, the aggregate cost of investment securities for
income tax purposes was $881,301,836. Net unrealized appreciation
aggregated $113,347,863, of which $118,085,581 related to appreciated
investment securities and $4,737,718 related to depreciated investment
securities.
The fund hereby designates approximately $11,804,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FIDELITY FREEDOM 2020 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
ASSETS
Investment in securities, at $ 994,649,699
value (including repurchase
agreements of $110,000)
(cost $876,159,567) - See
accompanying schedule
Cash 248
Receivable for Freedom Fund 1,748,618
shares sold
Dividends receivable 1,125,314
TOTAL ASSETS 997,523,879
LIABILITIES
Payable for underlying fund $ 1,800,487
shares purchased
Payable for Freedom Fund 1,010,806
shares redeemed
Accrued management fee 64,446
TOTAL LIABILITIES 2,875,739
NET ASSETS $ 994,648,140
Net Assets consist of:
Paid in capital $ 855,826,072
Undistributed net investment 2,740,430
income
Accumulated undistributed net 17,591,506
realized gain (loss) on
investments
Net unrealized appreciation 118,490,132
(depreciation) on investments
NET ASSETS, for 68,343,129 $ 994,648,140
shares outstanding
NET ASSET VALUE, offering $14.55
price and redemption price
per share ($994,648,140
(divided by) 68,343,129
shares)
STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 1999
INVESTMENT INCOME $ 15,233,463
Income distributions from
underlying funds
Interest 2,115
TOTAL INCOME 15,235,578
EXPENSES
Management fee $ 724,078
Non-interested trustees' 2,424
compensation
Total expenses before 726,502
reductions
Expense reductions (213,569) 512,933
NET INVESTMENT INCOME 14,722,645
REALIZED AND UNREALIZED GAIN (3,924,432)
(LOSS)
Realized gain (loss) on sale
of underlying fund shares
Capital gain distributions 32,490,284 28,565,852
from underlying funds
Change in net unrealized 70,879,089
appreciation (depreciation)
on investment securities
NET GAIN (LOSS) 99,444,941
NET INCREASE (DECREASE) IN $ 114,167,586
NET ASSETS RESULTING FROM
OPERATIONS
OTHER INFORMATION
Expense reductions $ 144,340
Reimbursement from
investment adviser
Transfer agent credits 69,229
$ 213,569
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MARCH 31, 1999 YEAR ENDED MARCH 31, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net investment $ 14,722,645 $ 2,281,903
income
Net realized gain (loss) 28,565,852 7,940,504
Change in net unrealized 70,879,089 48,041,041
appreciation (depreciation)
NET INCREASE (DECREASE) IN 114,167,586 58,263,448
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (16,160,557) (2,139,443)
From net investment income
From net realized gain (14,186,440) (775,606)
TOTAL DISTRIBUTIONS (30,346,997) (2,915,049)
Share transactions Net 557,805,316 561,324,674
proceeds from sales of
Freedom Fund shares
Reinvestment of distributions 30,338,310 2,914,790
Cost of Freedom Fund shares (254,918,709) (56,943,712)
redeemed
NET INCREASE (DECREASE) IN 333,224,917 507,295,752
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) 417,045,506 562,644,151
IN NET ASSETS
NET ASSETS
Beginning of period 577,602,634 14,958,483
End of period (including $ 994,648,140 $ 577,602,634
undistributed net investment
income of $2,740,430 and
$1,669,019, respectively)
OTHER INFORMATION
Shares
Sold 41,631,295 46,318,365
Issued in reinvestment of 2,209,990 249,279
distributions
Redeemed (18,984,307) (4,547,206)
Net increase (decrease) 24,856,978 42,020,438
</TABLE>
FINANCIAL HIGHLIGHTS
YEARS ENDED MARCH 31, 1999 1998 1997 E
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 13.28 $ 10.21 $ 10.00
period
Income from Investment
Operations
Net investment income D .27 .21 .08
Net realized and unrealized 1.55 3.33 .22
gain (loss)
Total from investment 1.82 3.54 .30
operations
Less Distributions
From net investment income (.28) (.34) (.09)
From net realized gain (.27) (.13) -
Total distributions (.55) (.47) (.09)
Net asset value, end of period $ 14.55 $ 13.28 $ 10.21
TOTAL RETURN B, C 14.00% 35.36% 2.99%
RATIOS AND SUPPLEMENTAL DATA
(amounts do not include the
activity of the underlying
funds)
Net assets, end of period $ 994,648 $ 577,603 $ 14,958
(000 omitted)
Ratio of expenses to average .08% F .08% F .08% A, F
net assets
Ratio of expenses to average .07% G .08% .08% A
net assets after expense
reductions
Ratio of net investment 2.03% 1.76% 1.75% A
income to average net assets
Portfolio turnover rate 18% 15% 21% A
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.
D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
E FOR THE PERIOD OCTOBER 17, 1996 (COMMENCEMENT OF OPERATIONS) TO
MARCH 31, 1997.
F STRATEGIC ADVISORS 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.
G STRATEGIC ADVISORS OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES.
FIDELITY FREEDOM 2030 FUND
INVESTMENT CHANGES
FUND HOLDINGS AS OF MARCH 31, 1999
<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS IN
THESE HOLDINGS 6 MONTHS AGO
DOMESTIC EQUITY FUNDS
Blue Chip Growth Fund 10.4% 10.4%
Disciplined Equity Fund 10.5 10.4
Equity-Income Fund 10.4 10.4
Fidelity Fund 10.5 10.3
Growth & Income Portfolio 10.4 10.6
Growth Company Fund 10.4 10.7
OTC Portfolio 6.9 7.2
69.5 70.0
INTERNATIONAL EQUITY FUNDS
Diversified International Fund 3.6 3.5
Europe Fund 5.0 4.7
Japan Fund 1.4 1.4
Overseas Fund 3.5 3.5
Southeast Asia Fund 0.7 0.7
14.2 13.8
INVESTMENT GRADE FIXED-INCOME
FUNDS
Government Income Fund 2.7 2.5
Intermediate Bond Fund 1.7 1.6
Investment Grade Bond Fund 2.7 2.5
7.1 6.6
HIGH YIELD FIXED-INCOME FUND
Capital & Income Fund 9.2 9.6
100.0% 100.0%
</TABLE>
ASSET ALLOCATION
SIX MONTHS AGO
Row: 1, Col: 1, Value: 9.6
Row: 1, Col: 2, Value: 6.6
Row: 1, Col: 3, Value: 13.8
Row: 1, Col: 4, Value: 70.0
9.6% (HY)
6.6% (IG)
70.0% (DE)
13.8% (IE)
CURRENT
Row: 1, Col: 1, Value: 9.199999999999999
Row: 1, Col: 2, Value: 7.1
Row: 1, Col: 3, Value: 14.2
Row: 1, Col: 4, Value: 69.5
9.2% (HY)
7.1% (IG)
69.5% (DE)
14.2% (IE)
Equity
DE = Domestic Equity funds
IE = International Equity funds
EXPECTED
Fixed-income
IG = Investment Grade funds
HY = High Yield fund
Row: 1, Col: 1, Value: 9.0
Row: 1, Col: 2, Value: 7.0
Row: 1, Col: 3, Value: 14.0
Row: 1, Col: 4, Value: 70.0
8.7% (HY)
70.0% (DE)
7.6% (IG)
13.7% (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 SEPTEMBER 30, 1998.
THE CURRENT ALLOCATION IS BASED ON THE FUND'S HOLDINGS AS OF MARCH 31,
1999. THE EXPECTED ALLOCATION REPRESENTS THE FUND'S ANTICIPATED TARGET
ASSET ALLOCATION AT SEPTEMBER 30, 1999.
FIDELITY FREEDOM 2030 FUND
INVESTMENTS MARCH 31, 1999
Showing Percentage of Total Value of Investment in Securities
<TABLE>
<CAPTION>
<S> <C> <C> <C>
EQUITY FUNDS - 83.7%
SHARES VALUE (NOTE 1)
DOMESTIC EQUITY FUNDS - 69.5%
Blue Chip Growth Fund 715,536 $ 38,116,623
Disciplined Equity Fund 1,243,466 38,249,009
Equity-Income Fund 680,436 38,050,006
Fidelity Fund 986,495 38,216,807
Growth & Income Portfolio 815,816 38,049,676
Growth Company Fund 691,928 38,159,821
OTC Portfolio 527,903 25,291,811
254,133,753
INTERNATIONAL EQUITY FUNDS -
14.2%
Diversified International Fund 711,136 12,942,680
Europe Fund 559,240 18,259,200
Japan Fund 404,918 5,182,957
Overseas Fund 349,747 12,937,135
Southeast Asia Fund 297,256 2,639,636
51,961,608
TOTAL EQUITY FUNDS 306,095,361
(Cost $273,172,379)
FIXED-INCOME FUNDS - 16.3%
HIGH YIELD FIXED-INCOME FUND
- - 9.2%
Capital & Income Fund 3,418,676 33,571,400
INVESTMENT GRADE FIXED-INCOME
FUNDS - 7.1%
Government Income Fund 990,365 9,774,907
Intermediate Bond Fund 629,176 6,392,427
Investment Grade Bond Fund 1,348,312 9,788,744
25,956,078
TOTAL FIXED-INCOME FUNDS 59,527,478
(Cost $59,285,152)
CASH EQUIVALENTS - 0.0%
MATURITY AMOUNT VALUE (NOTE 1)
Investments in repurchase $ 41,006 $ 41,000
agreements (U.S. Treasury
obligations), in a joint
trading account at 4.92%,
dated 3/31/99 due 4/1/99
TOTAL INVESTMENT IN $ 365,663,839
SECURITIES - 100%
(Cost $332,498,531)
</TABLE>
OTHER INFORMATION
Purchases and redemptions of the underlying fund shares aggregated
$262,266,403 and $34,740,504, respectively.
INCOME TAX INFORMATION
At March 31, 1999, the aggregate cost of investment securities for
income tax purposes was $334,678,402. Net unrealized appreciation
aggregated $30,985,437, of which $33,104,593 related to appreciated
investment securities and $2,119,156 related to depreciated investment
securities.
The fund hereby designates approximately $4,649,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FIDELITY FREEDOM 2030 FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
ASSETS
Investment in securities, at $ 365,663,839
value (including repurchase
agreements of $41,000) (cost
$332,498,531) - See
accompanying schedule
Cash 516
Receivable for Freedom Fund 1,593,672
shares sold
Dividends receivable 307,940
TOTAL ASSETS 367,565,967
LIABILITIES
Payable for underlying fund $ 980,168
shares purchased
Payable for Freedom Fund 905,748
shares redeemed
Accrued management fee 23,148
TOTAL LIABILITIES 1,909,064
NET ASSETS $ 365,656,903
Net Assets consist of:
Paid in capital $ 326,343,798
Undistributed net investment 1,017,661
income
Accumulated undistributed net 5,130,136
realized gain (loss) on
investments and foreign
currency transactions
Net unrealized appreciation 33,165,308
(depreciation) on investments
NET ASSETS, for 25,133,991 $ 365,656,903
shares outstanding
NET ASSET VALUE, offering $14.55
price and redemption price
per share ($365,656,903
(divided by) 25,133,991
shares)
STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 1999
INVESTMENT INCOME $ 4,215,753
Income distributions from
underlying funds
Interest 903
TOTAL INCOME 4,216,656
EXPENSES
Management fee $ 216,800
Non-interested trustees' 690
compensation
Total expenses before 217,490
reductions
Expense reductions (67,934) 149,556
NET INVESTMENT INCOME 4,067,100
REALIZED AND UNREALIZED GAIN
(LOSS)
Realized gain (loss) on sale (2,394,385)
of underlying fund shares
Capital gain distributions 10,864,971 8,470,586
from underlying funds
Change in net unrealized 25,407,252
appreciation (depreciation)
on investment securities
NET GAIN (LOSS) 33,877,838
NET INCREASE (DECREASE) IN $ 37,944,938
NET ASSETS RESULTING FROM
OPERATIONS
OTHER INFORMATION
Expense reductions $ 43,119
Reimbursement from
investment adviser
Custodian credits 21
Transfer agent credits 24,794
$ 67,934
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MARCH 31, 1999 YEAR ENDED MARCH 31, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net investment $ 4,067,100 $ 747,707
income
Net realized gain (loss) 8,470,586 4,956,471
Change in net unrealized 25,407,252 7,933,861
appreciation (depreciation)
NET INCREASE (DECREASE) IN 37,944,938 13,638,039
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (4,341,407) (757,317)
From net investment income
In excess of net investment - (610,205)
income
From net realized gain (5,938,957) (471,015)
TOTAL DISTRIBUTIONS (10,280,364) (1,838,537)
Share transactions Net 343,561,901 138,314,449
proceeds from sales of
Freedom Fund shares
Reinvestment of distributions 10,271,400 1,838,434
Cost of shares Freedom Fund (130,913,052) (42,605,715)
redeemed
NET INCREASE (DECREASE) IN 222,920,249 97,547,168
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) 250,584,823 109,346,670
IN NET ASSETS
NET ASSETS
Beginning of period 115,072,080 5,725,410
End of period (including $ 365,656,903 $ 115,072,080
undistributed net investment
income of $1,017,661 and
$344,198, respectively)
OTHER INFORMATION
Shares
Sold 25,582,555 11,252,452
Issued in reinvestment of 756,262 156,038
distributions
Redeemed (9,778,011) (3,395,851)
Net increase (decrease) 16,560,806 8,012,639
</TABLE>
FINANCIAL HIGHLIGHTS
YEARS ENDED MARCH 31, 1999 1998 1997 E
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 13.42 $ 10.21 $ 10.00
period
Income from Investment
Operations
Net investment income D .25 .22 .08
Net realized and unrealized 1.60 3.42 .22
gain (loss)
Total from investment 1.85 3.64 .30
operations
Less Distributions
From net investment income (.24) (.17) (.09)
In excess of net investment - (.14) -
income
From net realized gain (.48) (.12) -
Total distributions (.72) (.43) (.09)
Net asset value, end of period $ 14.55 $ 13.42 $ 10.21
TOTAL RETURN B, C 14.29% 36.28% 2.99%
RATIOS AND SUPPLEMENTAL DATA
(amounts do not include the
activity of the underlying
funds)
Net assets, end of period $ 365,657 $ 115,072 $ 5,725
(000 omitted)
Ratio of expenses to average .08% F .08% F .08% A, F
net assets
Ratio of expenses to average .07% G .08% .08% A
net assets after expense
reductions
Ratio of net investment 1.87% 1.78% 1.71% A
income to average net assets
Portfolio turnover rate 16% 34% 19% A
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.
D NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD.
E FOR THE PERIOD OCTOBER 17, 1996 (COMMENCEMENT OF OPERATIONS) TO
MARCH 31, 1997.
F 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.
G STRATEGIC ADVISERS OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES.
NOTES TO FINANCIAL STATEMENTS
For the period ended March 31, 1999
1. SIGNIFICANT ACCOUNTING POLICIES.
Freedom Income Fund, Freedom 2000 Fund, Freedom 2010 Fund, Freedom
2020 Fund, and 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, 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 require 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 the short-term gain distributions from the underlying
funds and losses deferred due to wash sales.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
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 the 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 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, Strategic Advisers has entered into arrangements on
behalf of certain funds with the funds' custodian and transfer agent
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 1 29%
Freedom 2000 1 45%
Freedom 2010 1 49%
Freedom 2020 1 52%
Freedom 2030 1 23%
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Aberdeen Street Trust and the Shareholders
of Fidelity Freedom Income, Fidelity Freedom 2000, Fidelity Freedom
2010, Fidelity Freedom 2020, Fidelity Freedom 2030 Funds:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Fidelity Freedom Income, Fidelity Freedom 2000, Fidelity Freedom 2010,
Fidelity Freedom 2020, and Fidelity Freedom 2030 Funds ( funds of
Fidelity Aberdeen Street Trust) at March 31, 1999, and the results of
their operations, the changes in their 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 Aberdeen Street Trust'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 at March 31, 1999 by
correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
May 7, 1999
DISTRIBUTIONS
The Board of Trustees of each fund voted to pay to shareholders of
record at the opening of business on record date, the following
distributions derived from capital gains realized from sales of
portfolio securities, and dividends derived from net investment
income:
PAY DATE RECORD DATE DIVIDENDS CAPITAL GAINS
Freedom Income 5/10/99 5/7/99 $0.04 $0.07
Freedom 2000 5/10/99 5/7/99 $0.10 $0.16
Freedom 2010 5/10/99 5/7/99 $0.07 $0.23
Freedom 2020 5/10/99 5/7/99 $0.05 $0.31
Freedom 2030 5/10/99 5/7/99 $0.04 $0.27
The following percentages of dividends distributed during the fiscal
year were derived from interest on U.S. Government securities which is
generally exempt from state income tax.
Freedom Income 8.54%
Freedom 2000 7.82%
Freedom 2010 5.05%
The following percentages of the dividends distributed during the
fiscal year qualifies for the dividends-received deduction for
corporate shareholders.
Freedom Income 5%
Freedom 2000 10%
Freedom 2010 20%
Freedom 2020 30%
Freedom 2030 31%
The fund will notify shareholders in January 2000 of the applicable
percentage for use in preparing 1999 income tax returns.
OF SPECIAL NOTE
INTRODUCING FIDELITY'S NEW, REORGANIZED PROSPECTUS
Recently, the SEC issued new disclosure requirements for all mutual
fund prospectuses. While Fidelity could have complied by simply
following the new requirements, we saw a different opportunity. We saw
the chance to create a brand new prospectus: one that is better
organized, easier to use and more informative than ever.
The new format of the Fidelity mutual fund prospectus puts the
information you need to make informed investment decisions right at
your fingertips. In the opening pages, you will find the SEC-mandated
summary that highlights the fund's investment objectives, strategies
and risks. There's also an easy-to-read performance chart and fee
table right up front.
Inside, you will find additional features we've introduced to make the
fund prospectus a more useful tool. In our new Shareholder Information
section, for example, we have provided practical, beneficial
information - from how to buy or sell shares, key contact information,
investment services, ways to set up your account and more - all in one
convenient location.
We invite you to spend a moment and review our new prospectus. It is
designed to help make your investment decision easier, no matter which
of the Fidelity funds you invest in.
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 Xpress(registered trademark) provides 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.
(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
1 For mutual fund and brokerage trading.
2 For quotes.*
3 For account balances and holdings.
4 To review orders and mutual
fund activity.
5 To change your PIN.
*0 To speak to a Fidelity representative.
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.
(COMPUTER_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call EarthLink Sprint at
1-800-288-2967, and be sure to ask for registration number SMD004 to
receive a special Fidelity package that includes 30 days of free
Internet access. EarthLink is North America's #1 independent Internet
access provider.
(COMPUTER_GRAPHIC)
FIDELITY ON-LINE XPRESS+(registered trademark)
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.
INVESTMENT ADVISER
Strategic Advisers, Inc.
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Robert A. Lawrence, Vice President
Scott D. Stewart, Vice President
Ren Y. Cheng, Vice President
Eric D. Roiter, Secretary
Richard A. Silver, Treasurer
Matthew N. Karstetter, Deputy Treasurer
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
Abigail P. Johnson
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Investments Institutional
Operations Company, Inc.
Boston, MA
* INDEPENDENT TRUSTEES
FF-ANN-0599 75205
1.702316.101
CUSTODIAN
The Bank of New York
New York, NY
FIDELITY'S ASSET ALLOCATION FUNDS
Asset ManagerSM
Asset Manager: GrowthSM
Asset Manager: IncomeSM
Fidelity Freedom Funds -
Income, 2000, 2010, 2020, 2030
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)
TouchTone Xpress (registered trademark) 1-800-544-5555
AUTOMATED LINE FOR QUICKEST SERVICE
(fidelity_logo_graphic)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com
