To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at www.sec.gov. You may also call 1-877-208-0098 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR Corp. or an affiliated company.
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.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC's web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. For a complete list of a fund's portfolio holdings, view the most recent quarterly holdings report, semiannual report, or annual report on Fidelity's web site at http://www.advisor.fidelity.com.
NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE
Neither the fund nor Fidelity Distributors Corporation is a bank.
Annual Report
Chairman's Message
(photo_of_Edward_C_Johnson_3d)
Dear Shareholder:
Although many securities markets made gains in early 2006, inflation concerns led to mixed results through the year's mid-point. Financial markets are always unpredictable. There are, however, a number of time-tested principles that can put the historical odds in your favor.
One of the basic tenets is to invest for the long term. Over time, riding out the markets' inevitable ups and downs has proven much more effective than selling into panic or chasing the hottest trend. Even missing only a few of the markets' best days can significantly diminish investor returns. Patience also affords the benefits of compounding - of earning interest on additional income or reinvested dividends and capital gains. There are tax advantages and cost benefits to consider as well. The more you sell, the more taxes you pay, and the more you trade, the higher the costs. While staying the course doesn't eliminate risk, it can considerably lessen the effect of short-term declines.
You can further manage your investing risk through diversification. And today, more than ever, geographic diversification should be taken into account. Studies indicate that asset allocation is the single most important determinant of a portfolio's long-term success. The right mix of stocks, bonds and cash - aligned to your particular risk tolerance and investment objective - is very important. Age-appropriate rebalancing is also an essential aspect of asset allocation. For younger investors, an emphasis on equities - which historically have been the best performing asset class over time - is encouraged. As investors near their specific goal, such as retirement or sending a child to college, consideration may be given to replacing volatile assets (e.g. common stocks) with more-stable fixed investments (bonds or savings plans).
A third investment principle - investing regularly - can help lower the average cost of your purchases. Investing a certain amount of money each month or quarter helps ensure you won't pay for all your shares at market highs. This strategy - known as dollar cost averaging - also reduces unconstructive "emotion" from investing, helping shareholders avoid selling weak performers just prior to an upswing, or chasing a hot performer just before a correction.
We invite you to contact us via the Internet, through our Investor Centers or over the phone. It is our privilege to provide you the information you need to make the investments that are right for you.
Sincerely,
/s/Edward C. Johnson 3d
Edward C. Johnson 3d
Semiannual Report
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (January 1, 2006 to June 30, 2006).
Actual Expenses
The first line of the accompanying table for each class of the Fund provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Semiannual Report
Investments - continued
Investments
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value January 1, 2006
Ending Account Value June 30, 2006
Expenses Paid During Period* January 1, 2006 to June 30, 2006
Class A
Actual
$ 1,000.00
$ 1,038.40
$ 5.76
HypotheticalA
$ 1,000.00
$ 1,019.14
$ 5.71
Class T
Actual
$ 1,000.00
$ 1,037.40
$ 6.77
HypotheticalA
$ 1,000.00
$ 1,018.15
$ 6.71
Class B
Actual
$ 1,000.00
$ 1,034.20
$ 9.84
HypotheticalA
$ 1,000.00
$ 1,015.12
$ 9.74
Class C
Actual
$ 1,000.00
$ 1,034.80
$ 9.38
HypotheticalA
$ 1,000.00
$ 1,015.57
$ 9.30
Institutional Class
Actual
$ 1,000.00
$ 1,039.90
$ 4.30
HypotheticalA
$ 1,000.00
$ 1,020.58
$ 4.26
A5% return per year before expenses
*Expenses are equal to each Class' annualized expense ratio (shown in the table below); multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
Annualized Expense Ratio
Class A
1.14%
Class T
1.34%
Class B
1.95%
Class C
1.86%
Institutional Class
.85%
Semiannual Report
Investment Changes
Top Ten Stocks as of June 30, 2006
% of fund's net assets
% of fund's net assets 6 months ago
Google, Inc. Class A (sub. vtg.)
4.1
4.3
Berkshire Hathaway, Inc. Class A
2.5
1.8
Genentech, Inc.
2.4
2.3
Hewlett-Packard Co.
2.3
2.0
EnCana Corp.
2.3
1.8
Schlumberger Ltd. (NY Shares)
1.8
1.0
Wells Fargo & Co.
1.6
1.3
America Movil SA de CV Series L sponsored ADR
1.5
1.5
Roche Holding AG (participation certificate)
1.5
1.3
Valero Energy Corp.
1.4
1.7
21.4
Top Five Market Sectors as of June 30, 2006
% of fund's net assets
% of fund's net assets 6 months ago
Information Technology
19.9
25.4
Financials
17.7
15.7
Energy
11.3
9.0
Health Care
9.1
14.5
Industrials
8.9
5.2
Asset Allocation (% of fund's net assets)
As of June 30, 2006 *
As of December 31, 2005 **
Stocks 92.0%
Stocks 89.9%
Bonds 0.0%
Bonds 0.1%
Convertible Securities 0.1%
Convertible Securities 0.0%
Short-Term Investments and Net Other Assets 7.9%
Short-Term Investments and Net Other Assets 10.0%
* Foreign investments
27.3%
** Foreign investments
24.6%
Semiannual Report
Investments June 30, 2006 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 92.0%
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - 8.3%
Auto Components - 0.0%
Johnson Controls, Inc.
4,400
$ 362
LKQ Corp. (a)
8,100
154
516
Automobiles - 0.8%
General Motors Corp. (d)
281,200
8,377
Harley-Davidson, Inc.
45,100
2,476
Honda Motor Co. Ltd.
188,000
5,982
Hyundai Motor Co.
6,700
569
Renault SA
19,100
2,052
Toyota Motor Corp.
727,700
38,055
57,511
Distributors - 0.0%
Li & Fung Ltd.
849,200
1,717
Diversified Consumer Services - 0.0%
Laureate Education, Inc. (a)
13,300
567
Hotels, Restaurants & Leisure - 1.9%
Ambassadors Group, Inc.
14,538
420
Aristocrat Leisure Ltd. (d)
1,040,000
9,955
Chipotle Mexican Grill, Inc. Class A
114,000
6,948
International Game Technology
61,000
2,314
Las Vegas Sands Corp. (a)
327,600
25,507
Panera Bread Co. Class A (a)
376,364
25,307
Penn National Gaming, Inc. (a)
209,500
8,124
Ruth's Chris Steak House, Inc.
77,900
1,591
Starbucks Corp. (a)
689,300
26,028
Station Casinos, Inc.
183,900
12,520
Tim Hortons, Inc. (d)
128,300
3,304
Wynn Resorts Ltd. (a)
109,100
7,997
130,015
Household Durables - 1.0%
Fourlis Holdings SA
500,000
7,100
Garmin Ltd.
143,000
15,078
KB Home
14,900
683
Matsushita Electric Industrial Co. Ltd.
474,100
10,018
Sharp Corp.
252,000
3,982
Sony Corp.
614,300
27,054
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - continued
Household Durables - continued
Sony Corp. sponsored ADR
10,600
$ 467
Whirlpool Corp.
7,700
636
65,018
Internet & Catalog Retail - 0.1%
Coldwater Creek, Inc. (a)
41,450
1,109
Expedia, Inc. (a)
149,200
2,234
Liberty Media Holding Corp. - Interactive Series A (a)
159,900
2,760
Submarino SA
50,000
1,004
VistaPrint Ltd.
58,600
1,567
8,674
Leisure Equipment & Products - 0.0%
Aruze Corp.
28,000
609
Media - 1.6%
CBS Corp. Class B
19,500
527
Focus Media Holding Ltd. ADR
68,100
4,437
Live Nation, Inc. (a)
56,800
1,156
McGraw-Hill Companies, Inc.
77,900
3,913
News Corp. Class B
572,700
11,557
NTL, Inc.
43,531
1,084
Seek Ltd.
1,000,000
3,976
Sirius Satellite Radio, Inc. (a)(d)
751,600
3,570
The Walt Disney Co.
2,493,500
74,805
The Weinstein Co. III Holdings, LLC Class A-1 (a)(g)
2,267
2,267
Thomson Corp.
52,400
2,019
109,311
Multiline Retail - 0.6%
JCPenney Co., Inc.
182,400
12,314
Marks & Spencer Group PLC
2,349,100
25,504
Nordstrom, Inc.
92,700
3,384
41,202
Specialty Retail - 2.1%
AnnTaylor Stores Corp. (a)
152,000
6,594
Bakers Footwear Group, Inc. (a)(d)(e)
620,600
8,633
Best Buy Co., Inc.
453,650
24,878
Casual Male Retail Group, Inc. (a)
297,700
2,992
Circuit City Stores, Inc.
713,405
19,419
Inditex SA
49,700
2,097
J. Crew Group, Inc.
230,100
6,316
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - continued
Specialty Retail - continued
Limited Brands, Inc.
210,400
$ 5,384
O'Reilly Automotive, Inc. (a)
16,900
527
Office Depot, Inc. (a)
804,800
30,582
Payless ShoeSource, Inc. (a)
71,400
1,940
Staples, Inc.
509,300
12,386
The Children's Place Retail Stores, Inc. (a)
11,400
685
TJX Companies, Inc.
734,400
16,788
Tractor Supply Co. (a)
14,400
796
Wet Seal, Inc. Class A (a)
193,200
943
Zumiez, Inc. (a)
13,000
488
141,448
Textiles, Apparel & Luxury Goods - 0.2%
Burberry Group PLC
91,700
729
Coach, Inc. (a)
102,000
3,050
Luxottica Group Spa sponsored ADR
23,400
635
Phillips-Van Heusen Corp.
24,800
946
Puma AG
9,000
3,499
Under Armour, Inc. Class A (sub. vtg.)
65,500
2,792
VF Corp.
65,400
4,442
16,093
TOTAL CONSUMER DISCRETIONARY
572,681
CONSUMER STAPLES - 5.4%
Beverages - 2.4%
Anheuser-Busch Companies, Inc.
19,900
907
Diageo PLC sponsored ADR
471,100
31,823
Hansen Natural Corp. (a)
20,100
3,826
InBev SA
20,000
981
Jones Soda Co. (a)(d)
310,890
2,798
PepsiCo, Inc.
1,309,300
78,610
The Coca-Cola Co.
1,040,400
44,758
163,703
Food & Staples Retailing - 0.4%
Costco Wholesale Corp.
49,400
2,822
Safeway, Inc.
27,800
723
Tesco PLC
1,296,585
8,010
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER STAPLES - continued
Food & Staples Retailing - continued
Wal-Mart de Mexico SA de CV Series V
787,478
$ 2,164
Wal-Mart Stores, Inc.
299,500
14,427
28,146
Food Products - 0.8%
Campbell Soup Co.
37,600
1,395
General Mills, Inc.
39,100
2,020
Groupe Danone
118,500
15,060
Hershey Co.
189,100
10,414
Kellogg Co.
72,600
3,516
Nestle SA (Reg.)
52,546
16,505
Sara Lee Corp.
164,500
2,635
TreeHouse Foods, Inc. (a)
183,500
4,384
Wm. Wrigley Jr. Co.
80,050
3,631
59,560
Household Products - 1.6%
Colgate-Palmolive Co.
548,500
32,855
Procter & Gamble Co.
1,387,067
77,121
109,976
Personal Products - 0.2%
Estee Lauder Companies, Inc. Class A
90,300
3,492
Herbalife Ltd. (a)
214,800
8,571
12,063
TOTAL CONSUMER STAPLES
373,448
ENERGY - 11.3%
Energy Equipment & Services - 3.0%
Baker Hughes, Inc.
488,900
40,016
BJ Services Co.
51,600
1,923
Halliburton Co.
200,700
14,894
Hydril Co. (a)
190,000
14,919
Schlumberger Ltd. (NY Shares)
1,870,800
121,808
Smith International, Inc.
62,644
2,786
Superior Well Services, Inc.
310,000
7,719
204,065
Oil, Gas & Consumable Fuels - 8.3%
Addax Petroleum Corp.
116,200
3,107
BG Group PLC sponsored ADR
174,500
11,671
Common Stocks - continued
Shares
Value (Note 1) (000s)
ENERGY - continued
Oil, Gas & Consumable Fuels - continued
BP PLC sponsored ADR
273,600
$ 19,045
Cameco Corp.
66,300
2,641
Canadian Natural Resources Ltd.
111,600
6,170
Canadian Oil Sands Trust unit
858,300
27,680
CONSOL Energy, Inc.
377,900
17,655
EnCana Corp.
2,974,800
156,641
EOG Resources, Inc.
242,200
16,794
Exxon Mobil Corp.
838,300
51,430
Foundation Coal Holdings, Inc.
32,100
1,506
Goodrich Petroleum Corp. (a)
23,730
674
Hess Corp.
27,900
1,475
Highpine Oil & Gas Ltd. (a)(f)
23,300
388
Hugoton Royalty Trust
2
0
Husky Energy, Inc.
21,300
1,337
Imperial Oil Ltd.
21,000
767
Kerr-McGee Corp.
51,800
3,592
Murphy Oil Corp.
347,800
19,428
Noble Energy, Inc.
196,500
9,208
Occidental Petroleum Corp.
147,100
15,085
Peabody Energy Corp.
309,400
17,249
PetroChina Co. Ltd. sponsored ADR (d)
324,800
35,069
Petroleo Brasileiro SA Petrobras sponsored ADR
105,500
9,422
Sasol Ltd. sponsored ADR
33,600
1,298
Suncor Energy, Inc.
152,300
12,325
Talisman Energy, Inc.
501,300
8,748
Total SA sponsored ADR
89,600
5,871
Ultra Petroleum Corp. (a)
191,000
11,321
Valero Energy Corp.
1,463,234
97,334
Western Oil Sands, Inc. Class A (a)
144,500
4,005
XTO Energy, Inc.
199,000
8,810
577,746
TOTAL ENERGY
781,811
FINANCIALS - 17.7%
Capital Markets - 0.6%
Charles Schwab Corp.
761,000
12,161
Goldman Sachs Group, Inc.
151,900
22,850
Lehman Brothers Holdings, Inc.
32,900
2,143
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Capital Markets - continued
Mellon Financial Corp.
208,800
$ 7,189
SEI Investments Co.
5,800
284
44,627
Commercial Banks - 4.2%
Allied Irish Banks PLC
616,500
14,907
Anglo Irish Bank Corp. PLC
1,753,900
27,372
Banco Itau Holding Financeira SA sponsored ADR (non-vtg.)
65,300
1,904
Bank of Ireland
230,400
4,139
Bank of the Ozarks, Inc.
39,100
1,302
Center Financial Corp., California
50,000
1,182
Commerce Bancorp, Inc., New Jersey
161,900
5,775
Compass Bancshares, Inc.
112,800
6,272
Home Bancshares, Inc.
8,100
184
HSBC Holdings PLC sponsored ADR
113,200
10,001
M&T Bank Corp.
340,100
40,105
Marshall & Ilsley Corp.
28,000
1,281
National Australia Bank Ltd.
131,500
3,436
PNC Financial Services Group, Inc.
32,700
2,295
Preferred Bank, Los Angeles California (e)
380,004
20,372
PrivateBancorp, Inc.
101,000
4,182
Royal Bank of Scotland Group PLC
438,000
14,404
Shinhan Financial Group Co. Ltd.
48,530
2,276
Standard Chartered PLC (United Kingdom)
163,800
3,999
SunTrust Banks, Inc.
52,900
4,034
Uniao de Bancos Brasileiros SA (Unibanco) GDR
87,700
5,822
Wells Fargo & Co.
1,684,800
113,016
Zions Bancorp
77,100
6,009
294,269
Consumer Finance - 1.8%
American Express Co.
1,255,200
66,802
SLM Corp.
1,049,100
55,518
122,320
Diversified Financial Services - 1.7%
Bank of America Corp.
1,024,100
49,259
Citigroup, Inc.
603,300
29,103
JPMorgan Chase & Co.
667,100
28,018
Moody's Corp.
183,600
9,999
116,379
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Insurance - 8.2%
Admiral Group PLC
780,700
$ 8,967
Allstate Corp.
865,100
47,347
American International Group, Inc.
557,500
32,920
Assurant, Inc.
199,100
9,636
Axis Capital Holdings Ltd.
32,400
927
Berkshire Hathaway, Inc. Class A (a)(d)
1,853
169,844
Cincinnati Financial Corp.
17,100
804
Everest Re Group Ltd.
159,300
13,791
Genworth Financial, Inc. Class A (non-vtg.)
541,400
18,862
Lincoln National Corp.
363,881
20,537
Loews Corp.
795,700
28,208
MetLife, Inc.
1,317,100
67,449
MetLife, Inc. unit
406,600
11,210
ProAssurance Corp. (a)
5,000
241
Progressive Corp.
345,500
8,883
Prudential Financial, Inc.
845,200
65,672
SAFECO Corp.
21,900
1,234
StanCorp Financial Group, Inc.
56,800
2,892
The Chubb Corp.
832,700
41,552
The St. Paul Travelers Companies, Inc.
21,600
963
W.R. Berkley Corp.
308,361
10,524
White Mountains Insurance Group Ltd.
8,383
4,083
Zenith National Insurance Corp.
61,500
2,440
568,986
Real Estate Investment Trusts - 0.1%
CBL & Associates Properties, Inc.
17,800
693
Equity Office Properties Trust
20,100
734
Equity Residential (SBI)
400
18
Vornado Realty Trust
61,300
5,980
7,425
Real Estate Management & Development - 0.2%
CB Richard Ellis Group, Inc. Class A (a)
450,400
11,215
Mitsui Fudosan Co. Ltd.
112,000
2,432
13,647
Thrifts & Mortgage Finance - 0.9%
Astoria Financial Corp.
44,600
1,358
Countrywide Financial Corp.
90,200
3,435
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Thrifts & Mortgage Finance - continued
Golden West Financial Corp., Delaware
733,200
$ 54,403
Hudson City Bancorp, Inc.
160,200
2,135
61,331
TOTAL FINANCIALS
1,228,984
HEALTH CARE - 9.1%
Biotechnology - 3.8%
Alexion Pharmaceuticals, Inc. (a)
152,305
5,501
Amylin Pharmaceuticals, Inc. (a)
206,900
10,215
Arena Pharmaceuticals, Inc. (a)
260,300
3,014
Celgene Corp. (a)
520,000
24,664
Genentech, Inc. (a)
2,037,900
166,700
Genmab AS (a)
60,400
1,947
Gilead Sciences, Inc. (a)
679,900
40,223
GTx, Inc. (a)
25,000
228
Hutchison China Meditech Ltd.
15
0
MannKind Corp. (a)(d)
290,006
6,180
MannKind Corp. warrants 8/3/10 (a)(g)
29,881
391
Medarex, Inc. (a)
431,700
4,149
Myogen, Inc. (a)
82,800
2,401
Renovis, Inc. (a)
23,400
358
Tanox, Inc. (a)
70,300
972
Theravance, Inc. (a)
30,300
693
ViaCell, Inc. (a)(d)
87,800
399
268,035
Health Care Equipment & Supplies - 1.0%
Becton, Dickinson & Co.
39,300
2,402
C.R. Bard, Inc.
122,000
8,938
Conceptus, Inc. (a)
24,100
329
DexCom, Inc. (a)
90,800
1,233
DJ Orthopedics, Inc. (a)
125,500
4,622
Gen-Probe, Inc. (a)
61,600
3,325
Intuitive Surgical, Inc. (a)
17,300
2,041
Inverness Medical Innovations, Inc. (a)
15,000
423
IRIS International, Inc. (a)(d)
545,400
7,177
Kyphon, Inc. (a)
164,000
6,291
NeuroMetrix, Inc. (a)
30,500
929
Nobel Biocare Holding AG (Switzerland)
22,293
5,293
Common Stocks - continued
Shares
Value (Note 1) (000s)
HEALTH CARE - continued
Health Care Equipment & Supplies - continued
Northstar Neuroscience, Inc.
87,500
$ 908
NuVasive, Inc. (a)
81,600
1,488
ResMed, Inc. (a)
259,500
12,184
St. Jude Medical, Inc. (a)
270,600
8,773
Viasys Healthcare, Inc. (a)
55,800
1,428
67,784
Health Care Providers & Services - 0.9%
Aetna, Inc.
989,900
39,527
American Retirement Corp. (a)
43,100
1,412
Health Net, Inc. (a)
48,600
2,195
Nighthawk Radiology Holdings, Inc.
31,000
556
UnitedHealth Group, Inc.
294,100
13,170
VCA Antech, Inc. (a)
108,500
3,464
Visicu, Inc.
9,700
171
60,495
Health Care Technology - 0.0%
Vital Images, Inc. (a)
46,100
1,139
Life Sciences Tools & Services - 0.2%
Covance, Inc. (a)
44,800
2,743
Exelixis, Inc. (a)
47,700
479
Millipore Corp. (a)
3,500
220
Pharmaceutical Product Development, Inc.
31,900
1,120
Thermo Electron Corp. (a)
260,100
9,426
13,988
Pharmaceuticals - 3.2%
Aspreva Pharmaceuticals Corp. (a)
267,800
7,268
AstraZeneca PLC sponsored ADR
272,400
16,295
Atherogenics, Inc. (a)
32,400
423
Barr Pharmaceuticals, Inc. (a)
10,300
491
Johnson & Johnson
361,500
21,661
Merck & Co., Inc.
522,600
19,038
New River Pharmaceuticals, Inc. (a)
22,200
633
Novartis AG sponsored ADR
573,300
30,912
Roche Holding AG (participation certificate)
631,193
104,347
Sanofi-Aventis sponsored ADR
308,100
15,004
Schering-Plough Corp.
56,700
1,079
Common Stocks - continued
Shares
Value (Note 1) (000s)
HEALTH CARE - continued
Pharmaceuticals - continued
Sepracor, Inc. (a)
11,900
$ 680
Teva Pharmaceutical Industries Ltd. sponsored ADR
155,848
4,923
222,754
TOTAL HEALTH CARE
634,195
INDUSTRIALS - 8.9%
Aerospace & Defense - 0.9%
Armor Holdings, Inc. (a)
39,000
2,138
Heico Corp. Class A
400,000
9,488
L-3 Communications Holdings, Inc.
6,400
483
Lockheed Martin Corp.
488,600
35,052
Northrop Grumman Corp.
54,400
3,485
Precision Castparts Corp.
24,600
1,470
The Boeing Co.
142,900
11,705
United Technologies Corp.
13,900
882
64,703
Air Freight & Logistics - 1.0%
C.H. Robinson Worldwide, Inc.
820,372
43,726
Expeditors International of Washington, Inc.
27,400
1,535
FedEx Corp.
59,400
6,941
United Parcel Service, Inc. Class B
214,300
17,643
69,845
Airlines - 0.4%
Republic Airways Holdings, Inc. (a)
50,100
853
Ryanair Holdings PLC sponsored ADR (a)
309,300
16,306
Southwest Airlines Co.
577,400
9,452
26,611
Commercial Services & Supplies - 0.8%
Aramark Corp. Class B
388,400
12,860
Brady Corp. Class A
111,500
4,108
Cendant Corp.
85,500
1,393
Huron Consulting Group, Inc. (a)
400,000
14,036
Monster Worldwide, Inc. (a)
207,400
8,848
Robert Half International, Inc.
309,300
12,991
The Brink's Co.
54,600
3,080
57,316
Common Stocks - continued
Shares
Value (Note 1) (000s)
INDUSTRIALS - continued
Construction & Engineering - 0.3%
Jacobs Engineering Group, Inc. (a)
237,500
$ 18,915
URS Corp. (a)
28,000
1,176
20,091
Electrical Equipment - 1.3%
Cooper Industries Ltd. Class A
530,600
49,303
Energy Conversion Devices, Inc. (a)
16,100
587
Evergreen Solar, Inc. (a)
452,900
5,879
GrafTech International Ltd. (a)
500,000
2,900
Q-Cells AG
114,300
9,615
Roper Industries, Inc.
87,100
4,072
SolarWorld AG (d)
188,000
11,801
Suntech Power Holdings Co. Ltd. sponsored ADR
121,000
3,418
Ultralife Batteries, Inc. (a)(d)
39,000
395
87,970
Industrial Conglomerates - 0.6%
3M Co.
449,100
36,274
Hutchison Whampoa Ltd.
301,000
2,748
Siemens AG sponsored ADR
33,200
2,882
41,904
Machinery - 2.4%
Caterpillar, Inc.
376,200
28,019
Cummins, Inc.
121,500
14,853
Danaher Corp.
754,377
48,522
IDEX Corp.
543,700
25,663
Joy Global, Inc.
363,757
18,948
PACCAR, Inc.
326,366
26,886
162,891
Marine - 0.1%
American Commercial Lines, Inc.
123,300
7,429
Road & Rail - 0.8%
Canadian National Railway Co.
494,700
21,609
CSX Corp.
10,300
726
Heartland Express, Inc.
182,533
3,266
Knight Transportation, Inc.
58,130
1,174
Landstar System, Inc.
112,900
5,332
Norfolk Southern Corp.
44,800
2,384
Common Stocks - continued
Shares
Value (Note 1) (000s)
INDUSTRIALS - continued
Road & Rail - continued
Swift Transportation Co., Inc. (a)
257,100
$ 8,165
Universal Truckload Services, Inc. (a)
469,903
16,038
58,694
Trading Companies & Distributors - 0.3%
Fastenal Co.
147,500
5,943
Mitsui & Co. Ltd.
1,102,000
15,563
21,506
TOTAL INDUSTRIALS
618,960
INFORMATION TECHNOLOGY - 19.9%
Communications Equipment - 1.8%
CommScope, Inc. (a)
25,500
801
Corning, Inc. (a)
540,300
13,070
ECI Telecom Ltd. (a)
228,900
1,845
F5 Networks, Inc. (a)
94,700
5,065
InterDigital Communication Corp. (a)
42,500
1,484
Ixia (a)
354,600
3,191
Nice Systems Ltd. sponsored ADR (a)
503,500
14,168
Nokia Corp. sponsored ADR
1,585,100
32,114
QUALCOMM, Inc.
1,291,800
51,762
TANDBERG Television ASA (a)
55,000
912
124,412
Computers & Peripherals - 3.8%
Apple Computer, Inc. (a)
1,218,300
69,589
Dell, Inc. (a)
192,400
4,696
Hewlett-Packard Co.
5,050,900
160,013
Network Appliance, Inc. (a)
713,860
25,199
Seagate Technology
222,900
5,046
264,543
Electronic Equipment & Instruments - 0.9%
Agilent Technologies, Inc. (a)
1,800
57
Amphenol Corp. Class A
237,500
13,291
Hon Hai Precision Industry Co. Ltd. (Foxconn)
459,104
2,836
Identix, Inc. (a)
19,300
135
Itron, Inc. (a)
80,100
4,747
KEMET Corp. (a)
1,000,000
9,220
LoJack Corp. (a)
300,000
5,658
Mettler-Toledo International, Inc. (a)
72,800
4,409
Common Stocks - continued
Shares
Value (Note 1) (000s)
INFORMATION TECHNOLOGY - continued
Electronic Equipment & Instruments - continued
Motech Industries, Inc.
395,935
$ 9,318
National Instruments Corp.
490,000
13,426
Sunpower Corp. Class A
6,200
174
Viisage Technology, Inc. (a)
7,300
111
63,382
Internet Software & Services - 5.7%
Akamai Technologies, Inc. (a)
648,000
23,451
aQuantive, Inc. (a)
142,800
3,617
Google, Inc. Class A (sub. vtg.) (a)
674,400
282,799
j2 Global Communications, Inc. (a)
133,000
4,152
LoopNet, Inc. (a)
13,000
242
NetEase.com, Inc. sponsored ADR (a)(d)
223,000
4,980
Tom Online, Inc. sponsored ADR (a)(d)
52,500
1,013
WebSideStory, Inc. (a)(d)
446,056
5,442
Yahoo!, Inc. (a)
2,078,300
68,584
394,280
IT Services - 2.1%
Alliance Data Systems Corp. (a)
298,900
17,581
CheckFree Corp. (a)(d)
387,200
19,190
Cognizant Technology Solutions Corp. Class A (a)
471,000
31,731
First Data Corp.
401,700
18,093
Global Payments, Inc.
54,300
2,636
Infosys Technologies Ltd. sponsored ADR
82,700
6,319
Mastercard, Inc. Class A
265,500
12,744
MoneyGram International, Inc.
29,200
991
Paychex, Inc.
86,900
3,387
SRA International, Inc. Class A (a)
201,561
5,368
TALX Corp.
412,500
9,021
The BISYS Group, Inc. (a)
46,500
637
VeriFone Holdings, Inc. (a)
583,800
17,794
145,492
Office Electronics - 0.0%
Canon, Inc.
36,800
1,798
Zebra Technologies Corp. Class A (a)
19,600
670
2,468
Semiconductors & Semiconductor Equipment - 4.4%
Applied Materials, Inc.
693,200
11,285
ASML Holding NV (NY Shares) (a)
764,800
15,464
Broadcom Corp. Class A (a)
676,600
20,332
Common Stocks - continued
Shares
Value (Note 1) (000s)
INFORMATION TECHNOLOGY - continued
Semiconductors & Semiconductor Equipment - continued
FormFactor, Inc. (a)
416,100
$ 18,571
Freescale Semiconductor, Inc. Class A (a)
11,000
319
Hittite Microwave Corp.
93,100
3,366
Lam Research Corp. (a)
808,100
37,674
Linear Technology Corp.
78,900
2,642
Marvell Technology Group Ltd. (a)
1,900,600
84,254
MathStar, Inc.
10,000
59
MEMC Electronic Materials, Inc. (a)
326,400
12,240
Microchip Technology, Inc.
63,900
2,144
Monolithic Power Systems, Inc. (a)
86,184
1,020
National Semiconductor Corp.
633,800
15,116
O2Micro International Ltd. sponsored ADR (a)
3,000
23
Renewable Energy Corp. AS
191,300
2,736
Saifun Semiconductors Ltd.
50,000
1,433
Samsung Electronics Co. Ltd.
102,062
64,871
SiRF Technology Holdings, Inc. (a)
285,500
9,199
Zoran Corp. (a)
17,000
414
303,162
Software - 1.2%
Adobe Systems, Inc. (a)
519,006
15,757
Amdocs Ltd. (a)
37,700
1,380
Citrix Systems, Inc. (a)
112,900
4,532
ECtel Ltd. (a)
5,649
25
Informatica Corp. (a)
18,000
237
Intuit, Inc. (a)
443,177
26,763
JDA Software Group, Inc. (a)
400,000
5,612
NAVTEQ Corp. (a)
179,530
8,021
NDS Group PLC sponsored ADR (a)
21,200
987
Salesforce.com, Inc. (a)
140,700
3,751
SAP AG sponsored ADR
246,800
12,962
80,027
TOTAL INFORMATION TECHNOLOGY
1,377,766
MATERIALS - 7.8%
Chemicals - 1.2%
Arkema sponsored ADR (a)
9,210
356
Bayer AG
242,500
11,133
Ecolab, Inc.
698,800
28,357
Lonza Group AG
8,756
601
Common Stocks - continued
Shares
Value (Note 1) (000s)
MATERIALS - continued
Chemicals - continued
Monsanto Co.
142,300
$ 11,980
Praxair, Inc.
490,200
26,471
Wacker Chemie AG
15,900
1,712
80,610
Construction Materials - 0.0%
Rinker Group Ltd.
169,281
2,062
Metals & Mining - 6.6%
Agnico-Eagle Mines Ltd.
231,700
7,682
Alamos Gold, Inc. (a)(d)
1,010,000
8,143
Allegheny Technologies, Inc.
56,400
3,905
Anglo American PLC ADR
1,392,900
28,471
Aquarius Platinum Ltd. (Australia)
598,000
8,777
Bema Gold Corp. (a)
2,517,400
12,561
BHP Billiton Ltd. sponsored ADR
1,199,500
51,662
Companhia Vale do Rio Doce sponsored ADR
102,000
2,452
Eldorado Gold Corp. (a)
608,400
2,954
First Quantum Minerals Ltd.
786,400
35,252
Gabriel Resources Ltd. (a)
725,700
1,879
Gerdau SA sponsored ADR
226,450
3,376
Glamis Gold Ltd. (a)
2,465,757
93,479
Goldcorp, Inc.
951,475
28,681
IPSCO, Inc.
129,000
12,350
Ivanhoe Mines Ltd. (a)
488,000
3,305
Lihir Gold Ltd. (a)
990,100
2,119
Meridian Gold, Inc. (a)
159,600
5,035
New Gold, Inc. (a)
466,300
4,152
New Gold, Inc. warrants 2/23/08 (a)
65,000
111
Newmont Mining Corp.
948,900
50,225
Novagold Resources, Inc. (a)
196,900
2,524
Nucor Corp.
383,200
20,789
Oregon Steel Mills, Inc. (a)
46,000
2,330
POSCO sponsored ADR
248,600
16,631
Rio Tinto PLC (Reg.)
853,200
44,731
Steel Dynamics, Inc.
82,400
5,417
Teck Cominco Ltd. Class B (sub. vtg.)
33,400
2,004
US Gold Corp. (subscription receipt) (a)(g)
112,300
1,128
462,125
TOTAL MATERIALS
544,797
Common Stocks - continued
Shares
Value (Note 1) (000s)
TELECOMMUNICATION SERVICES - 3.0%
Diversified Telecommunication Services - 0.5%
AT&T, Inc.
509,100
$ 14,199
BT Group PLC sponsored ADR
63,600
2,817
Qwest Communications International, Inc. (a)
1,801,900
14,577
Telenor ASA
190,800
2,307
33,900
Wireless Telecommunication Services - 2.5%
America Movil SA de CV Series L sponsored ADR
3,156,400
104,982
American Tower Corp. Class A (a)
59,527
1,852
China Mobile (Hong Kong) Ltd. sponsored ADR
300,600
8,600
Hutchison Telecommunications International Ltd. sponsored ADR (a)(d)
147,300
3,522
Leap Wireless International, Inc. (a)
86,100
4,085
NII Holdings, Inc. (a)
951,647
53,654
176,695
TOTAL TELECOMMUNICATION SERVICES
210,595
UTILITIES - 0.6%
Electric Utilities - 0.1%
Exelon Corp.
82,800
4,706
FirstEnergy Corp.
89,100
4,830
9,536
Gas Utilities - 0.1%
Southern Union Co.
226,875
6,139
Independent Power Producers & Energy Traders - 0.3%
AES Corp. (a)
719,600
13,277
International Power PLC
264,200
1,390
TXU Corp.
71,000
4,245
18,912
Multi-Utilities - 0.1%
National Grid PLC
554,900
6,004
Veolia Environnement
26,900
1,391
7,395
TOTAL UTILITIES
41,982
TOTAL COMMON STOCKS
(Cost $5,702,251)
6,385,219
Convertible Preferred Stocks - 0.1%
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - 0.1%
Automobiles - 0.1%
General Motors Corp. Series B, 5.25%
310,900
$ 5,693
TOTAL CONVERTIBLE PREFERRED STOCKS
(Cost $5,152)
5,693
Money Market Funds - 9.8%
Fidelity Cash Central Fund, 5.11% (b)
598,552,930
598,553
Fidelity Securities Lending Cash Central Fund, 5.14% (b)(c)
81,361,352
81,361
TOTAL MONEY MARKET FUNDS
(Cost $679,914)
679,914
TOTAL INVESTMENT PORTFOLIO - 101.9%
(Cost $6,387,317)
7,070,826
NET OTHER ASSETS - (1.9)%
(132,079)
NET ASSETS - 100%
$ 6,938,747
Legend
(a) Non-income producing
(b) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.
(c) Investment made with cash collateral received from securities on loan.
(d) Security or a portion of the security is on loan at period end.
(e) Affiliated company
(f) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the period end, the value of these securities amounted to $388,000 or 0.0% of net assets.
(g) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $3,786,000 or 0.1% of net assets.
Additional information on each holding is as follows:
Security
Acquisition Date
Acquisition Cost (000s)
MannKind Corp. warrants 8/3/10
8/3/05
$ 1
The Weinstein Co. III Holdings, LLC Class A-1
10/19/05
$ 2,267
US Gold Corp. (subscription receipt)
2/8/06
$ 505
Affiliated Central Funds
Information regarding fiscal year to date income earned by the fund from the affiliated Central funds is as follows:
Fund
Income earned (Amounts in thousands)
Fidelity Cash Central Fund
$ 17,778
Fidelity Securities Lending Cash Central Fund
482
Total
$ 18,260
Other Affiliated Issuers
An affiliated company is a company in which the fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliates (Amounts in thousands)
Value, beginning of period
Purchases
Sales Proceeds
Dividend Income
Value, end of period
Bakers Footwear Group, Inc.
$ 7,130
$ 3,181
$ -
$ -
$ 8,633
Preferred Bank, Los Angeles California
-
19,483
-
39
20,372
TOTALS
$ 7,130
$ 22,664
$ -
$ 39
$ 29,005
Other Information
Distribution of investments by country of issue, as a percentage of total net assets, is as follows:
United States of America
72.7%
Canada
7.0%
United Kingdom
3.5%
Bermuda
2.3%
Switzerland
2.3%
Netherlands Antilles
1.8%
Japan
1.6%
Mexico
1.5%
Korea (South)
1.1%
Others (individually less than 1%)
6.2%
100.0%
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts)
June 30, 2006 (Unaudited)
Assets
Investment in securities, at value (including securities loaned of $79,918) - See accompanying schedule:
Unaffiliated issuers (cost $5,678,277)
$ 6,361,907
Affiliated Central Funds (cost $679,914)
679,914
Other affiliated issuers (cost $29,126)
29,005
Total Investments (cost $6,387,317)
$ 7,070,826
Cash
1
Foreign currency held at value (cost $15,243)
15,243
Receivable for investments sold
27,481
Receivable for fund shares sold
6,182
Dividends receivable
4,374
Interest receivable
3,346
Prepaid expenses
4
Other receivables
264
Total assets
7,127,721
Liabilities
Payable for investments purchased
$ 93,837
Payable for fund shares redeemed
5,812
Accrued management fee
3,184
Distribution fees payable
2,743
Other affiliated payables
1,428
Other payables and accrued expenses
609
Collateral on securities loaned, at value
81,361
Total liabilities
188,974
Net Assets
$ 6,938,747
Net Assets consist of:
Paid in capital
$ 6,264,721
Undistributed net investment income
1,674
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions
(11,049)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies
683,401
Net Assets
$ 6,938,747
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Assets and Liabilities - continued
Amounts in thousands (except per-share amounts)
June 30, 2006 (Unaudited)
Calculation of Maximum Offering Price Class A: Net Asset Value and redemption price per share ($1,683,204 ÷ 97,640 shares)
$ 17.24
Maximum offering price per share (100/94.25 of $17.24)
$ 18.29
Class T: Net Asset Value and redemption price per share ($2,013,614 ÷ 117,454 shares)
$ 17.14
Maximum offering price per share (100/96.50 of $17.14)
$ 17.76
Class B: Net Asset Value and offering price per share ($448,712 ÷ 26,611 shares)A
$ 16.86
Class C: Net Asset Value and offering price per share ($1,513,890 ÷ 89,640 shares)A
$ 16.89
Institutional Class: Net Asset Value, offering price and redemption price per share ($1,279,327 ÷ 73,528 shares)
$ 17.40
A Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Statement of Operations
Amounts in thousands
Six months ended June 30, 2006 (Unaudited)
Investment Income
Dividends (including $39 received from other affiliated issuers)
$ 24,406
Interest
92
Income from affiliated Central Funds
18,260
Total income
42,758
Expenses
Management fee
$ 17,029
Transfer agent fees
7,140
Distribution fees
15,241
Accounting and security lending fees
603
Independent trustees' compensation
11
Custodian fees and expenses
383
Registration fees
904
Audit
41
Legal
29
Interest
4
Miscellaneous
130
Total expenses before reductions
41,515
Expense reductions
(465)
41,050
Net investment income (loss)
1,708
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investment securities:
Unaffiliated issuers (net of foreign taxes of $19)
(4,213)
Foreign currency transactions
309
Total net realized gain (loss)
(3,904)
Change in net unrealized appreciation (depreciation) on:
Investment securities (net of decrease in deferred foreign taxes of $11)
132,697
Assets and liabilities in foreign currencies
(108)
Total change in net unrealized appreciation (depreciation)
132,589
Net gain (loss)
128,685
Net increase (decrease) in net assets resulting from operations
$ 130,393
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Changes in Net Assets
Amounts in thousands
Six months ended June 30, 2006 (Unaudited)
Year ended December 31, 2005
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)
$ 1,708
$ (3,298)
Net realized gain (loss)
(3,904)
15,438
Change in net unrealized appreciation (depreciation)
132,589
426,567
Net increase (decrease) in net assets resulting from operations
130,393
438,707
Distributions to shareholders from net realized gain
(14,806)
-
Share transactions - net increase (decrease)
2,568,102
2,787,029
Total increase (decrease) in net assets
2,683,689
3,225,736
Net Assets
Beginning of period
4,255,058
1,029,322
End of period (including undistributed net investment income of $1,674 and accumulated net investment loss of $34, respectively)
$ 6,938,747
$ 4,255,058
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class A
Six month ended June 30,2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.65
$ 13.99
$ 11.79
$ 10.00
Income from Investment Operations
Net investment income (loss) E
.02
.02
(.03)
(.04)
Net realized and unrealized gain (loss)
.62
2.64
2.24
1.87
Total from investment operations
.64
2.66
2.21
1.83
Distributions from net investment income
-
-
(.01)
(.03)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.04)
Net asset value, end of period
$ 17.24
$ 16.65
$ 13.99
$ 11.79
Total ReturnB, C, D
3.84%
19.01%
18.76%
18.23%
Ratios to Average Net AssetsG
Expenses before reductions
1.14% A
1.17%
1.22%
1.39% A
Expenses net of fee waivers, if any
1.14% A
1.17%
1.22%
1.39% A
Expenses net of all reductions
1.13% A
1.13%
1.17%
1.28% A
Net investment income (loss)
.29% A
.13%
(.26)%
(.81)% A
Supplemental Data
Net assets, end of period (in millions)
$ 1,683
$ 1,019
$ 230
$ 37
Portfolio turnover rate
82% A
65%
87%
77% A
AAnnualized
BTotal returns for periods of less than one year are not annualized.
CTotal returns would have been lower had certain expenses not been reduced during the periods shown.
DTotal returns do not include the effect of the sales charges.
ECalculated based on average shares outstanding during the period.
FFor the period July 31, 2003 (commencement of operations) to December 31, 2003.
GExpense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class T
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.57
$ 13.96
$ 11.78
$ 10.00
Income from Investment Operations
Net investment income (loss) E
.01
(.01)
(.06)
(.05)
Net realized and unrealized gain (loss)
.61
2.62
2.25
1.86
Total from investment operations
.62
2.61
2.19
1.81
Distributions from net investment income
-
-
(.01)
(.02)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.03)
Net asset value, end of period
$ 17.14
$ 16.57
$ 13.96
$ 11.78
Total ReturnB, C, D
3.74%
18.70%
18.60%
18.08%
Ratios to Average Net AssetsG
Expenses before reductions
1.34% A
1.38%
1.43%
1.62% A
Expenses net of fee waivers, if any
1.34% A
1.38%
1.43%
1.62% A
Expenses net of all reductions
1.32% A
1.34%
1.39%
1.51% A
Net investment income (loss)
.09% A
(.08)%
(.48)%
(1.04)% A
Supplemental Data
Net assets, end of period (in millions)
$ 2,014
$ 1,393
$ 325
$ 62
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Total returns do not include the effect of the sales charges.
E Calculated based on average shares outstanding during the period.
F For the period July 31, 2003 (commencement of operations) to December 31, 2003.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class B
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.35
$ 13.85
$ 11.76
$ 10.00
Income from Investment Operations
Net investment income (loss) E
(.04)
(.10)
(.13)
(.07)
Net realized and unrealized gain (loss)
.60
2.60
2.23
1.85
Total from investment operations
.56
2.50
2.10
1.78
Distributions from net investment income
-
-
(.01)
(.01)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.02)
Net asset value, end of period
$ 16.86
$ 16.35
$ 13.85
$ 11.76
Total ReturnB, C, D
3.42%
18.05%
17.87%
17.75%
Ratios to Average Net AssetsG
Expenses before reductions
1.95% A
1.98%
2.02%
2.19% A
Expenses net of fee waivers, if any
1.95% A
1.98%
2.02%
2.19% A
Expenses net of all reductions
1.93% A
1.94%
1.97%
2.08% A
Net investment income (loss)
(.52)% A
(.68)%
(1.06)%
(1.61)% A
Supplemental Data
Net assets, end of period (in millions)
$ 449
$ 339
$ 109
$ 27
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Calculated based on average shares outstanding during the period.
F For the period July 31, 2003 (commencement of operations) to December 31, 2003.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class C
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.37
$ 13.86
$ 11.76
$ 10.00
Income from Investment Operations
Net investment income (loss) E
(.04)
(.09)
(.12)
(.07)
Net realized and unrealized gain (loss)
.61
2.60
2.23
1.85
Total from investment operations
.57
2.51
2.11
1.78
Distributions from net investment income
-
-
(.01)
(.01)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.02)
Net asset value, end of period
$ 16.89
$ 16.37
$ 13.86
$ 11.76
Total ReturnB, C, D
3.48%
18.11%
17.95%
17.77%
Ratios to Average Net AssetsG
Expenses before reductions
1.86% A
1.89%
1.94%
2.14% A
Expenses net of fee waivers, if any
1.86% A
1.89%
1.94%
2.14% A
Expenses net of all reductions
1.85% A
1.85%
1.89%
2.03% A
Net investment income (loss)
(.43)% A
(.59)%
(.98)%
(1.55)% A
Supplemental Data
Net assets, end of period (in millions)
$ 1,514
$ 1,006
$ 246
$ 49
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Calculated based on average shares outstanding during the period.
F For the period July 31, 2003 (commencement of operations) to December 31, 2003.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Institutional Class
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003E
Selected Per-Share Data
Net asset value, beginning of period
$ 16.78
$ 14.05
$ 11.79
$ 10.00
Income from Investment Operations
Net investment income (loss) D
.05
.07
.01
(.02)
Net realized and unrealized gain (loss)
.62
2.66
2.26
1.86
Total from investment operations
.67
2.73
2.27
1.84
Distributions from net investment income
-
-
(.01)
(.04)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.05)
Net asset value, end of period
$ 17.40
$ 16.78
$ 14.05
$ 11.79
Total ReturnB, C
3.99%
19.43%
19.27%
18.31%
Ratios to Average Net AssetsF
Expenses before reductions
.85% A
.84%
.86%
1.07% A
Expenses net of fee waivers, if any
.85% A
.84%
.86%
1.07% A
Expenses net of all reductions
.84% A
.79%
.82%
.96% A
Net investment income (loss)
.58% A
.47%
.10%
(.49)% A
Supplemental Data
Net assets, end of period (in millions)
$ 1,279
$ 498
$ 120
$ 23
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Calculated based on average shares outstanding during the period.
E For the period July 31, 2003 (commencement of operations) to December 31, 2003.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Notes to Financial Statements
For the period ended June 30, 2006 (Unaudited)
(Amounts in thousands except ratios)
1. Significant Accounting Policies.
Fidelity Advisor New Insights Fund (the Fund) is a fund of Fidelity Contrafund (the trust) and is authorized to issue an unlimited number of shares. Effective the close of business on April 28, 2006, the Fund was closed to most new accounts. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust.
The Fund offers Class A, Class T, Class B, Class C, and Institutional Class shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class. Class B shares will automatically convert to Class A shares after a holding period of seven years from the initial date of purchase. Investment income, realized and unrealized capital gains and losses, the common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated on a pro rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.
The Fund may invest in affiliated money market central funds (Money Market Central Funds), which are open-end investment companies available to investment companies and other accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, 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 Fund:
Security Valuation. Investments are valued and net asset value (NAV) per share is calculated (NAV calculation) as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time. Wherever possible, the Fund uses independent pricing services approved by the Board of Trustees to value its investments.
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Investments in open-end mutual funds are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
1. Significant Accounting Policies - continued
Security Valuation - continued
When current market prices or quotations are not readily available or do not accurately reflect fair value, valuations may be determined in accordance with procedures adopted by the Board of Trustees. For example, when developments occur between the close of a market and the close of the NYSE that may materially affect the value of some or all of the securities, or when trading in a security is halted, those securities may be fair valued. Factors used in the determination of fair value may include monitoring news to identify significant market or security specific events such as changes in the value of U.S. securities markets, reviewing developments in foreign markets and evaluating the performance of ADRs, futures contracts and exchange-traded funds. Because the Fund's utilization of fair value pricing depends on market activity, the frequency with which fair value pricing is used can not be predicted and may be utilized to a significant extent. The value of securities used for NAV calculation under fair value pricing may differ from published prices for the same securities.
Foreign Currency. The Fund uses foreign currency contracts to facilitate transactions in foreign-denominated securities. Losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rate at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. Security transactions are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income is accrued as
Semiannual Report
1. Significant Accounting Policies - continued
Investment Transactions and Income - continued
earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code. As a result, no provision for income taxes is required in the accompanying financial statements. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are recorded on the ex-dividend date. Income dividends and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, passive foreign investment companies (PFIC), market discount, net operating losses, capital loss carryforwards, and losses deferred due to wash sales.
The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:
Unrealized appreciation
$ 821,135
Unrealized depreciation
(147,182)
Net unrealized appreciation (depreciation)
$ 673,953
Cost for federal income tax purposes
$ 6,396,873
New Accounting Pronouncement. In July 2006, Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement 109 (FIN 48)was issued and is effective for fiscal years beginning after December 15, 2006. FIN 48 sets forth a threshold for financial statement recognition, measurement and disclosure of a tax position taken or expected to be taken on a tax return. Management is currently evaluating the impact, if any, the adoption of FIN 48 will have on the Fund's net assets and results of operations.
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
2. Operating Policies.
Repurchase Agreements. FMR has received an Exemptive Order from the Securities and Exchange Commission (the SEC) which permits the Fund and other affiliated entities of FMR to transfer uninvested cash balances into joint trading accounts which are then invested in repurchase agreements. The Fund may also invest directly with institutions in repurchase agreements. Repurchase agreements are collateralized by government or non-government securities. Upon settlement date, collateral is held in segregated accounts with custodian banks and may be obtained in the event of a default of the counterparty. The Fund monitors, on a daily basis, the value of the collateral to ensure it is at least equal to the principal amount of the repurchase agreement (including accrued interest). In the event of a default by the counterparty, realization of the collateral proceeds could be delayed, during which time the value of the collateral may decline.
Restricted Securities. The Fund may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of the Fund's Schedule of Investments.
3. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and U.S. government securities, aggregated $4,589,558 and $2,152,598, respectively.
4. Fees and Other Transactions with Affiliates.
Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and a group fee rate that averaged ..27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .57% of the Fund's average net assets.
Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has adopted separate Distribution and Service Plans for each class of shares. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of FMR, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for
Semiannual Report
4. Fees and Other Transactions with Affiliates - continued
Distribution and Service Plan - continued
selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates and the total amounts paid to and retained by FDC were as follows:
Distribution Fee
Service Fee
Paid to FDC
Retained by FDC
Class A
0%
.25%
$ 1,821
$ 82
Class T
.25%
.25%
4,542
340
Class B
.75%
.25%
2,091
1,571
Class C
.75%
.25%
6,787
4,175
$ 15,241
$ 6,168
Sales Load. FDC receives a front-end sales charge of up to 5.75% for selling Class A shares, and 3.50% for selling Class T shares, some of which is paid to financial intermediaries for selling shares of the Fund. FDC receives the proceeds of contingent deferred sales charges levied on Class A, Class T, Class B, and Class C redemptions. These charges depend on the holding period. The deferred sales charges range from 5% to 1% for Class B, 1% for Class C, 1.00% to .50% for certain purchases of Class A shares (.25% prior to February 24, 2006) and .25% for certain purchases of Class T shares.
For the period, sales charge amounts retained by FDC were as follows:
Retained by FDC
Class A
$ 1,885
Class T
440
Class B*
282
Class C*
153
$ 2,760
* When Class B and Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of the respective classes of the Fund. FIIOC pays for typesetting, printing and mailing of
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
4. Fees and Other Transactions with Affiliates - continued
Transfer Agent Fees - continued
shareholder reports, except proxy statements. For the period the total transfer agent fees paid by each class to FIIOC, were as follows:
Amount
% of Average Net Assets
Class A
$ 1,900
.26*
Class T
1,898
.21*
Class B
665
.32*
Class C
1,595
.23*
Institutional Class
1,082
.22*
$ 7,140
* Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for the month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions.
Affiliated Central Funds. The Fund may invest in Money Market Central Funds which seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.
The Money Market Central Funds do not pay a management fee.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $14 for the period.
5. Committed Line of Credit.
The Fund participates with other funds managed by FMR in a $4.2 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro rata portion of the line of credit, which amounts to $6 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.
Semiannual Report
6. Security Lending.
The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. If the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, a fund could experience delays and costs in recovering the securities loaned or in gaining access to the collateral. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Net income from lending portfolio securities during the period amounted to $482.
7. Bank Borrowings.
The Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. The Fund has established borrowing arrangements with certain banks. The interest rate on the borrowings is the bank's base rate, as revised from time to time. The average daily loan balance during the period for which loans were outstanding amounted to $27,763. The weighted average interest rate was 5.31%. At period end, there were no bank borrowings outstanding.
8. Expense Reductions.
Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $452 for the period. In addition, through arrangements with the Fund's custodian and each class' transfer agent, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
8. Expense Reductions - continued
the period, these credits reduced the Fund's custody expenses by $2. During the period, credits reduced each class' transfer agent expense as noted in the table below.
Transfer Agent expense reduction
Class A
$ 3
Class T
5
Institutional Class
3
$ 11
9. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
10. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended June 30, 2006
Year ended December 31, 2005
From net realized gain
Class A
$ 3,604
$ -
Class T
4,694
-
Class B
1,130
-
Class C
3,506
-
Institutional Class
1,872
-
Total
$ 14,806
$ -
Semiannual Report
11. Share Transactions.
Transactions for each class of shares were as follows:
Shares
Dollars
Six months ended June 30, 2006
Year ended December 31, 2005
Six months ended June 30, 2006
Year ended December 31, 2005
Class A
Shares sold
43,726
48,615
$ 758,679
$ 747,881
Reinvestment of distributions
186
-
3,201
-
Shares redeemed
(7,489)
(3,868)
(128,194)
(58,730)
Net increase (decrease)
36,423
44,747
$ 633,686
$ 689,151
Class T
Shares sold
41,187
65,661
$ 711,835
$ 990,175
Reinvestment of distributions
260
-
4,446
-
Shares redeemed
(8,035)
(4,899)
(137,559)
(73,812)
Net increase (decrease)
33,412
60,762
$ 578,722
$ 916,363
Class B
Shares sold
8,061
14,492
$ 137,365
$ 215,896
Reinvestment of distributions
56
-
941
-
Shares redeemed
(2,254)
(1,584)
(38,052)
(23,549)
Net increase (decrease)
5,863
12,908
$ 100,254
$ 192,347
Class C
Shares sold
32,227
46,847
$ 549,551
$ 703,988
Reinvestment of distributions
154
-
2,604
-
Shares redeemed
(4,215)
(3,110)
(70,486)
(46,058)
Net increase (decrease)
28,166
43,737
$ 481,669
$ 657,930
Institutional Class
Shares sold
50,637
22,374
$ 891,242
$ 349,673
Reinvestment of distributions
69
-
1,201
-
Shares redeemed
(6,852)
(1,206)
(118,672)
(18,435)
Net increase (decrease)
43,854
21,168
$ 773,771
$ 331,238
Semiannual Report
Board Approval of Investment Advisory Contracts and Management Fees
Advisor New Insights Fund
On January 19, 2006, the Board of Trustees, including the Independent Trustees (together, the Board), voted to approve a general research services agreement (the Agreement) between FMR, FMR Co., Inc. (FMRC), Fidelity Investments Money Management, Inc. (FIMM), and Fidelity Research & Analysis Company (FRAC) (together, the Investment Advisers) for the fund, effective January 20, 2006, pursuant to which FRAC may provide general research and investment advisory support services to FMRC and FIMM. The Board considered that it has approved previously various sub-advisory agreements for the fund with affiliates of FMR that allow FMR to obtain research, non-discretionary advice, or discretionary portfolio management at no additional expense to the fund. The Board, assisted by the advice of fund counsel and independent Trustees' counsel, considered a broad range of information and determined that it would be beneficial for the fund to access the research and investment advisory support services supplied by FRAC at no additional expense to the fund.
The Board reached this determination in part because the new arrangement will involve no changes in (i) the contractual terms of and fees payable under the fund's management contract or sub-advisory agreements; (ii) the investment process or strategies employed in the management of the fund's assets; (iii) the nature or level of services provided under the fund's management contract or sub-advisory agreements; (iv) the day-to-day management of the fund or the persons primarily responsible for such management; or (v) the ultimate control or beneficial ownership of FMR, FMRC, or FIMM. The Board also considered that the establishment of the Agreement would not necessitate prior shareholder approval of the Agreement or result in an assignment and termination of the fund's management contract or sub-advisory agreements under the Investment Company Act of 1940.
Because the Board was approving an arrangement with FRAC under which the fund will not bear any additional management fees or expenses and under which the fund's portfolio manager would not change, it did not consider the fund's investment performance, competitiveness of management fee and total expenses, costs of services and profitability, or economies of scale to be significant factors in its decision.
In connection with its future renewal of the fund's management contract and sub-advisory agreements, the Board will consider: (i) the nature, extent, and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the fund's management fee and total expenses; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred by Fidelity in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders; and (iv) whether there have been economies of scale in respect of the management of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is potential for realization of any further economies.
Semiannual Report
Board Approval of Investment Advisory Contracts and Management Fees - continued
Based on its evaluation of all of the conclusions noted above, and after considering all material factors, the Board ultimately concluded that the fund's Agreement is fair and reasonable, and that the fund's Agreement should be approved.
Semiannual Report
Investment Adviser
Fidelity Management & Research Company
Boston, MA
Investment Sub-Adviser
FMR Co., Inc.
Fidelity Management & Research (U.K.) Inc.
Fidelity Research & Analysis Company (formerly Fidelity Management & Research (Far East) Inc.)
Fidelity Investments Japan Limited
Fidelity International Investment Advisors
Fidelity International Investment Advisors (U.K.) Limited
General Distributor
Fidelity Distributors Corporation
Boston, MA
Transfer and Service Agents
Fidelity Investments Institutional Operations Company, Inc.
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at www.sec.gov. You may also call 1-877-208-0098 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR Corp. or an affiliated company.
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.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC's web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. For a complete list of a fund's portfolio holdings, view the most recent quarterly holdings report, semiannual report, or annual report on Fidelity's web site at http://www.advisor.fidelity.com.
NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE
Neither the fund nor Fidelity Distributors Corporation is a bank.
Annual Report
Chairman's Message
(photo_of_Edward_C_Johnson_3d)
Dear Shareholder:
Although many securities markets made gains in early 2006, inflation concerns led to mixed results through the year's mid-point. Financial markets are always unpredictable. There are, however, a number of time-tested principles that can put the historical odds in your favor.
One of the basic tenets is to invest for the long term. Over time, riding out the markets' inevitable ups and downs has proven much more effective than selling into panic or chasing the hottest trend. Even missing only a few of the markets' best days can significantly diminish investor returns. Patience also affords the benefits of compounding - of earning interest on additional income or reinvested dividends and capital gains. There are tax advantages and cost benefits to consider as well. The more you sell, the more taxes you pay, and the more you trade, the higher the costs. While staying the course doesn't eliminate risk, it can considerably lessen the effect of short-term declines.
You can further manage your investing risk through diversification. And today, more than ever, geographic diversification should be taken into account. Studies indicate that asset allocation is the single most important determinant of a portfolio's long-term success. The right mix of stocks, bonds and cash - aligned to your particular risk tolerance and investment objective - is very important. Age-appropriate rebalancing is also an essential aspect of asset allocation. For younger investors, an emphasis on equities - which historically have been the best performing asset class over time - is encouraged. As investors near their specific goal, such as retirement or sending a child to college, consideration may be given to replacing volatile assets (e.g. common stocks) with more-stable fixed investments (bonds or savings plans).
A third investment principle - investing regularly - can help lower the average cost of your purchases. Investing a certain amount of money each month or quarter helps ensure you won't pay for all your shares at market highs. This strategy - known as dollar cost averaging - also reduces unconstructive "emotion" from investing, helping shareholders avoid selling weak performers just prior to an upswing, or chasing a hot performer just before a correction.
We invite you to contact us via the Internet, through our Investor Centers or over the phone. It is our privilege to provide you the information you need to make the investments that are right for you.
Sincerely,
/s/Edward C. Johnson 3d
Edward C. Johnson 3d
Semiannual Report
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (January 1, 2006 to June 30, 2006).
Actual Expenses
The first line of the accompanying table for each class of the Fund provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Semiannual Report
Investments - continued
Investments
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value January 1, 2006
Ending Account Value June 30, 2006
Expenses Paid During Period* January 1, 2006 to June 30, 2006
Class A
Actual
$ 1,000.00
$ 1,038.40
$ 5.76
HypotheticalA
$ 1,000.00
$ 1,019.14
$ 5.71
Class T
Actual
$ 1,000.00
$ 1,037.40
$ 6.77
HypotheticalA
$ 1,000.00
$ 1,018.15
$ 6.71
Class B
Actual
$ 1,000.00
$ 1,034.20
$ 9.84
HypotheticalA
$ 1,000.00
$ 1,015.12
$ 9.74
Class C
Actual
$ 1,000.00
$ 1,034.80
$ 9.38
HypotheticalA
$ 1,000.00
$ 1,015.57
$ 9.30
Institutional Class
Actual
$ 1,000.00
$ 1,039.90
$ 4.30
HypotheticalA
$ 1,000.00
$ 1,020.58
$ 4.26
A5% return per year before expenses
*Expenses are equal to each Class' annualized expense ratio (shown in the table below); multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
Annualized Expense Ratio
Class A
1.14%
Class T
1.34%
Class B
1.95%
Class C
1.86%
Institutional Class
.85%
Semiannual Report
Investment Changes
Top Ten Stocks as of June 30, 2006
% of fund's net assets
% of fund's net assets 6 months ago
Google, Inc. Class A (sub. vtg.)
4.1
4.3
Berkshire Hathaway, Inc. Class A
2.5
1.8
Genentech, Inc.
2.4
2.3
Hewlett-Packard Co.
2.3
2.0
EnCana Corp.
2.3
1.8
Schlumberger Ltd. (NY Shares)
1.8
1.0
Wells Fargo & Co.
1.6
1.3
America Movil SA de CV Series L sponsored ADR
1.5
1.5
Roche Holding AG (participation certificate)
1.5
1.3
Valero Energy Corp.
1.4
1.7
21.4
Top Five Market Sectors as of June 30, 2006
% of fund's net assets
% of fund's net assets 6 months ago
Information Technology
19.9
25.4
Financials
17.7
15.7
Energy
11.3
9.0
Health Care
9.1
14.5
Industrials
8.9
5.2
Asset Allocation (% of fund's net assets)
As of June 30, 2006 *
As of December 31, 2005 **
Stocks 92.0%
Stocks 89.9%
Bonds 0.0%
Bonds 0.1%
Convertible Securities 0.1%
Convertible Securities 0.0%
Short-Term Investments and Net Other Assets 7.9%
Short-Term Investments and Net Other Assets 10.0%
* Foreign investments
27.3%
** Foreign investments
24.6%
Semiannual Report
Investments June 30, 2006 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 92.0%
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - 8.3%
Auto Components - 0.0%
Johnson Controls, Inc.
4,400
$ 362
LKQ Corp. (a)
8,100
154
516
Automobiles - 0.8%
General Motors Corp. (d)
281,200
8,377
Harley-Davidson, Inc.
45,100
2,476
Honda Motor Co. Ltd.
188,000
5,982
Hyundai Motor Co.
6,700
569
Renault SA
19,100
2,052
Toyota Motor Corp.
727,700
38,055
57,511
Distributors - 0.0%
Li & Fung Ltd.
849,200
1,717
Diversified Consumer Services - 0.0%
Laureate Education, Inc. (a)
13,300
567
Hotels, Restaurants & Leisure - 1.9%
Ambassadors Group, Inc.
14,538
420
Aristocrat Leisure Ltd. (d)
1,040,000
9,955
Chipotle Mexican Grill, Inc. Class A
114,000
6,948
International Game Technology
61,000
2,314
Las Vegas Sands Corp. (a)
327,600
25,507
Panera Bread Co. Class A (a)
376,364
25,307
Penn National Gaming, Inc. (a)
209,500
8,124
Ruth's Chris Steak House, Inc.
77,900
1,591
Starbucks Corp. (a)
689,300
26,028
Station Casinos, Inc.
183,900
12,520
Tim Hortons, Inc. (d)
128,300
3,304
Wynn Resorts Ltd. (a)
109,100
7,997
130,015
Household Durables - 1.0%
Fourlis Holdings SA
500,000
7,100
Garmin Ltd.
143,000
15,078
KB Home
14,900
683
Matsushita Electric Industrial Co. Ltd.
474,100
10,018
Sharp Corp.
252,000
3,982
Sony Corp.
614,300
27,054
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - continued
Household Durables - continued
Sony Corp. sponsored ADR
10,600
$ 467
Whirlpool Corp.
7,700
636
65,018
Internet & Catalog Retail - 0.1%
Coldwater Creek, Inc. (a)
41,450
1,109
Expedia, Inc. (a)
149,200
2,234
Liberty Media Holding Corp. - Interactive Series A (a)
159,900
2,760
Submarino SA
50,000
1,004
VistaPrint Ltd.
58,600
1,567
8,674
Leisure Equipment & Products - 0.0%
Aruze Corp.
28,000
609
Media - 1.6%
CBS Corp. Class B
19,500
527
Focus Media Holding Ltd. ADR
68,100
4,437
Live Nation, Inc. (a)
56,800
1,156
McGraw-Hill Companies, Inc.
77,900
3,913
News Corp. Class B
572,700
11,557
NTL, Inc.
43,531
1,084
Seek Ltd.
1,000,000
3,976
Sirius Satellite Radio, Inc. (a)(d)
751,600
3,570
The Walt Disney Co.
2,493,500
74,805
The Weinstein Co. III Holdings, LLC Class A-1 (a)(g)
2,267
2,267
Thomson Corp.
52,400
2,019
109,311
Multiline Retail - 0.6%
JCPenney Co., Inc.
182,400
12,314
Marks & Spencer Group PLC
2,349,100
25,504
Nordstrom, Inc.
92,700
3,384
41,202
Specialty Retail - 2.1%
AnnTaylor Stores Corp. (a)
152,000
6,594
Bakers Footwear Group, Inc. (a)(d)(e)
620,600
8,633
Best Buy Co., Inc.
453,650
24,878
Casual Male Retail Group, Inc. (a)
297,700
2,992
Circuit City Stores, Inc.
713,405
19,419
Inditex SA
49,700
2,097
J. Crew Group, Inc.
230,100
6,316
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - continued
Specialty Retail - continued
Limited Brands, Inc.
210,400
$ 5,384
O'Reilly Automotive, Inc. (a)
16,900
527
Office Depot, Inc. (a)
804,800
30,582
Payless ShoeSource, Inc. (a)
71,400
1,940
Staples, Inc.
509,300
12,386
The Children's Place Retail Stores, Inc. (a)
11,400
685
TJX Companies, Inc.
734,400
16,788
Tractor Supply Co. (a)
14,400
796
Wet Seal, Inc. Class A (a)
193,200
943
Zumiez, Inc. (a)
13,000
488
141,448
Textiles, Apparel & Luxury Goods - 0.2%
Burberry Group PLC
91,700
729
Coach, Inc. (a)
102,000
3,050
Luxottica Group Spa sponsored ADR
23,400
635
Phillips-Van Heusen Corp.
24,800
946
Puma AG
9,000
3,499
Under Armour, Inc. Class A (sub. vtg.)
65,500
2,792
VF Corp.
65,400
4,442
16,093
TOTAL CONSUMER DISCRETIONARY
572,681
CONSUMER STAPLES - 5.4%
Beverages - 2.4%
Anheuser-Busch Companies, Inc.
19,900
907
Diageo PLC sponsored ADR
471,100
31,823
Hansen Natural Corp. (a)
20,100
3,826
InBev SA
20,000
981
Jones Soda Co. (a)(d)
310,890
2,798
PepsiCo, Inc.
1,309,300
78,610
The Coca-Cola Co.
1,040,400
44,758
163,703
Food & Staples Retailing - 0.4%
Costco Wholesale Corp.
49,400
2,822
Safeway, Inc.
27,800
723
Tesco PLC
1,296,585
8,010
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER STAPLES - continued
Food & Staples Retailing - continued
Wal-Mart de Mexico SA de CV Series V
787,478
$ 2,164
Wal-Mart Stores, Inc.
299,500
14,427
28,146
Food Products - 0.8%
Campbell Soup Co.
37,600
1,395
General Mills, Inc.
39,100
2,020
Groupe Danone
118,500
15,060
Hershey Co.
189,100
10,414
Kellogg Co.
72,600
3,516
Nestle SA (Reg.)
52,546
16,505
Sara Lee Corp.
164,500
2,635
TreeHouse Foods, Inc. (a)
183,500
4,384
Wm. Wrigley Jr. Co.
80,050
3,631
59,560
Household Products - 1.6%
Colgate-Palmolive Co.
548,500
32,855
Procter & Gamble Co.
1,387,067
77,121
109,976
Personal Products - 0.2%
Estee Lauder Companies, Inc. Class A
90,300
3,492
Herbalife Ltd. (a)
214,800
8,571
12,063
TOTAL CONSUMER STAPLES
373,448
ENERGY - 11.3%
Energy Equipment & Services - 3.0%
Baker Hughes, Inc.
488,900
40,016
BJ Services Co.
51,600
1,923
Halliburton Co.
200,700
14,894
Hydril Co. (a)
190,000
14,919
Schlumberger Ltd. (NY Shares)
1,870,800
121,808
Smith International, Inc.
62,644
2,786
Superior Well Services, Inc.
310,000
7,719
204,065
Oil, Gas & Consumable Fuels - 8.3%
Addax Petroleum Corp.
116,200
3,107
BG Group PLC sponsored ADR
174,500
11,671
Common Stocks - continued
Shares
Value (Note 1) (000s)
ENERGY - continued
Oil, Gas & Consumable Fuels - continued
BP PLC sponsored ADR
273,600
$ 19,045
Cameco Corp.
66,300
2,641
Canadian Natural Resources Ltd.
111,600
6,170
Canadian Oil Sands Trust unit
858,300
27,680
CONSOL Energy, Inc.
377,900
17,655
EnCana Corp.
2,974,800
156,641
EOG Resources, Inc.
242,200
16,794
Exxon Mobil Corp.
838,300
51,430
Foundation Coal Holdings, Inc.
32,100
1,506
Goodrich Petroleum Corp. (a)
23,730
674
Hess Corp.
27,900
1,475
Highpine Oil & Gas Ltd. (a)(f)
23,300
388
Hugoton Royalty Trust
2
0
Husky Energy, Inc.
21,300
1,337
Imperial Oil Ltd.
21,000
767
Kerr-McGee Corp.
51,800
3,592
Murphy Oil Corp.
347,800
19,428
Noble Energy, Inc.
196,500
9,208
Occidental Petroleum Corp.
147,100
15,085
Peabody Energy Corp.
309,400
17,249
PetroChina Co. Ltd. sponsored ADR (d)
324,800
35,069
Petroleo Brasileiro SA Petrobras sponsored ADR
105,500
9,422
Sasol Ltd. sponsored ADR
33,600
1,298
Suncor Energy, Inc.
152,300
12,325
Talisman Energy, Inc.
501,300
8,748
Total SA sponsored ADR
89,600
5,871
Ultra Petroleum Corp. (a)
191,000
11,321
Valero Energy Corp.
1,463,234
97,334
Western Oil Sands, Inc. Class A (a)
144,500
4,005
XTO Energy, Inc.
199,000
8,810
577,746
TOTAL ENERGY
781,811
FINANCIALS - 17.7%
Capital Markets - 0.6%
Charles Schwab Corp.
761,000
12,161
Goldman Sachs Group, Inc.
151,900
22,850
Lehman Brothers Holdings, Inc.
32,900
2,143
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Capital Markets - continued
Mellon Financial Corp.
208,800
$ 7,189
SEI Investments Co.
5,800
284
44,627
Commercial Banks - 4.2%
Allied Irish Banks PLC
616,500
14,907
Anglo Irish Bank Corp. PLC
1,753,900
27,372
Banco Itau Holding Financeira SA sponsored ADR (non-vtg.)
65,300
1,904
Bank of Ireland
230,400
4,139
Bank of the Ozarks, Inc.
39,100
1,302
Center Financial Corp., California
50,000
1,182
Commerce Bancorp, Inc., New Jersey
161,900
5,775
Compass Bancshares, Inc.
112,800
6,272
Home Bancshares, Inc.
8,100
184
HSBC Holdings PLC sponsored ADR
113,200
10,001
M&T Bank Corp.
340,100
40,105
Marshall & Ilsley Corp.
28,000
1,281
National Australia Bank Ltd.
131,500
3,436
PNC Financial Services Group, Inc.
32,700
2,295
Preferred Bank, Los Angeles California (e)
380,004
20,372
PrivateBancorp, Inc.
101,000
4,182
Royal Bank of Scotland Group PLC
438,000
14,404
Shinhan Financial Group Co. Ltd.
48,530
2,276
Standard Chartered PLC (United Kingdom)
163,800
3,999
SunTrust Banks, Inc.
52,900
4,034
Uniao de Bancos Brasileiros SA (Unibanco) GDR
87,700
5,822
Wells Fargo & Co.
1,684,800
113,016
Zions Bancorp
77,100
6,009
294,269
Consumer Finance - 1.8%
American Express Co.
1,255,200
66,802
SLM Corp.
1,049,100
55,518
122,320
Diversified Financial Services - 1.7%
Bank of America Corp.
1,024,100
49,259
Citigroup, Inc.
603,300
29,103
JPMorgan Chase & Co.
667,100
28,018
Moody's Corp.
183,600
9,999
116,379
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Insurance - 8.2%
Admiral Group PLC
780,700
$ 8,967
Allstate Corp.
865,100
47,347
American International Group, Inc.
557,500
32,920
Assurant, Inc.
199,100
9,636
Axis Capital Holdings Ltd.
32,400
927
Berkshire Hathaway, Inc. Class A (a)(d)
1,853
169,844
Cincinnati Financial Corp.
17,100
804
Everest Re Group Ltd.
159,300
13,791
Genworth Financial, Inc. Class A (non-vtg.)
541,400
18,862
Lincoln National Corp.
363,881
20,537
Loews Corp.
795,700
28,208
MetLife, Inc.
1,317,100
67,449
MetLife, Inc. unit
406,600
11,210
ProAssurance Corp. (a)
5,000
241
Progressive Corp.
345,500
8,883
Prudential Financial, Inc.
845,200
65,672
SAFECO Corp.
21,900
1,234
StanCorp Financial Group, Inc.
56,800
2,892
The Chubb Corp.
832,700
41,552
The St. Paul Travelers Companies, Inc.
21,600
963
W.R. Berkley Corp.
308,361
10,524
White Mountains Insurance Group Ltd.
8,383
4,083
Zenith National Insurance Corp.
61,500
2,440
568,986
Real Estate Investment Trusts - 0.1%
CBL & Associates Properties, Inc.
17,800
693
Equity Office Properties Trust
20,100
734
Equity Residential (SBI)
400
18
Vornado Realty Trust
61,300
5,980
7,425
Real Estate Management & Development - 0.2%
CB Richard Ellis Group, Inc. Class A (a)
450,400
11,215
Mitsui Fudosan Co. Ltd.
112,000
2,432
13,647
Thrifts & Mortgage Finance - 0.9%
Astoria Financial Corp.
44,600
1,358
Countrywide Financial Corp.
90,200
3,435
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Thrifts & Mortgage Finance - continued
Golden West Financial Corp., Delaware
733,200
$ 54,403
Hudson City Bancorp, Inc.
160,200
2,135
61,331
TOTAL FINANCIALS
1,228,984
HEALTH CARE - 9.1%
Biotechnology - 3.8%
Alexion Pharmaceuticals, Inc. (a)
152,305
5,501
Amylin Pharmaceuticals, Inc. (a)
206,900
10,215
Arena Pharmaceuticals, Inc. (a)
260,300
3,014
Celgene Corp. (a)
520,000
24,664
Genentech, Inc. (a)
2,037,900
166,700
Genmab AS (a)
60,400
1,947
Gilead Sciences, Inc. (a)
679,900
40,223
GTx, Inc. (a)
25,000
228
Hutchison China Meditech Ltd.
15
0
MannKind Corp. (a)(d)
290,006
6,180
MannKind Corp. warrants 8/3/10 (a)(g)
29,881
391
Medarex, Inc. (a)
431,700
4,149
Myogen, Inc. (a)
82,800
2,401
Renovis, Inc. (a)
23,400
358
Tanox, Inc. (a)
70,300
972
Theravance, Inc. (a)
30,300
693
ViaCell, Inc. (a)(d)
87,800
399
268,035
Health Care Equipment & Supplies - 1.0%
Becton, Dickinson & Co.
39,300
2,402
C.R. Bard, Inc.
122,000
8,938
Conceptus, Inc. (a)
24,100
329
DexCom, Inc. (a)
90,800
1,233
DJ Orthopedics, Inc. (a)
125,500
4,622
Gen-Probe, Inc. (a)
61,600
3,325
Intuitive Surgical, Inc. (a)
17,300
2,041
Inverness Medical Innovations, Inc. (a)
15,000
423
IRIS International, Inc. (a)(d)
545,400
7,177
Kyphon, Inc. (a)
164,000
6,291
NeuroMetrix, Inc. (a)
30,500
929
Nobel Biocare Holding AG (Switzerland)
22,293
5,293
Common Stocks - continued
Shares
Value (Note 1) (000s)
HEALTH CARE - continued
Health Care Equipment & Supplies - continued
Northstar Neuroscience, Inc.
87,500
$ 908
NuVasive, Inc. (a)
81,600
1,488
ResMed, Inc. (a)
259,500
12,184
St. Jude Medical, Inc. (a)
270,600
8,773
Viasys Healthcare, Inc. (a)
55,800
1,428
67,784
Health Care Providers & Services - 0.9%
Aetna, Inc.
989,900
39,527
American Retirement Corp. (a)
43,100
1,412
Health Net, Inc. (a)
48,600
2,195
Nighthawk Radiology Holdings, Inc.
31,000
556
UnitedHealth Group, Inc.
294,100
13,170
VCA Antech, Inc. (a)
108,500
3,464
Visicu, Inc.
9,700
171
60,495
Health Care Technology - 0.0%
Vital Images, Inc. (a)
46,100
1,139
Life Sciences Tools & Services - 0.2%
Covance, Inc. (a)
44,800
2,743
Exelixis, Inc. (a)
47,700
479
Millipore Corp. (a)
3,500
220
Pharmaceutical Product Development, Inc.
31,900
1,120
Thermo Electron Corp. (a)
260,100
9,426
13,988
Pharmaceuticals - 3.2%
Aspreva Pharmaceuticals Corp. (a)
267,800
7,268
AstraZeneca PLC sponsored ADR
272,400
16,295
Atherogenics, Inc. (a)
32,400
423
Barr Pharmaceuticals, Inc. (a)
10,300
491
Johnson & Johnson
361,500
21,661
Merck & Co., Inc.
522,600
19,038
New River Pharmaceuticals, Inc. (a)
22,200
633
Novartis AG sponsored ADR
573,300
30,912
Roche Holding AG (participation certificate)
631,193
104,347
Sanofi-Aventis sponsored ADR
308,100
15,004
Schering-Plough Corp.
56,700
1,079
Common Stocks - continued
Shares
Value (Note 1) (000s)
HEALTH CARE - continued
Pharmaceuticals - continued
Sepracor, Inc. (a)
11,900
$ 680
Teva Pharmaceutical Industries Ltd. sponsored ADR
155,848
4,923
222,754
TOTAL HEALTH CARE
634,195
INDUSTRIALS - 8.9%
Aerospace & Defense - 0.9%
Armor Holdings, Inc. (a)
39,000
2,138
Heico Corp. Class A
400,000
9,488
L-3 Communications Holdings, Inc.
6,400
483
Lockheed Martin Corp.
488,600
35,052
Northrop Grumman Corp.
54,400
3,485
Precision Castparts Corp.
24,600
1,470
The Boeing Co.
142,900
11,705
United Technologies Corp.
13,900
882
64,703
Air Freight & Logistics - 1.0%
C.H. Robinson Worldwide, Inc.
820,372
43,726
Expeditors International of Washington, Inc.
27,400
1,535
FedEx Corp.
59,400
6,941
United Parcel Service, Inc. Class B
214,300
17,643
69,845
Airlines - 0.4%
Republic Airways Holdings, Inc. (a)
50,100
853
Ryanair Holdings PLC sponsored ADR (a)
309,300
16,306
Southwest Airlines Co.
577,400
9,452
26,611
Commercial Services & Supplies - 0.8%
Aramark Corp. Class B
388,400
12,860
Brady Corp. Class A
111,500
4,108
Cendant Corp.
85,500
1,393
Huron Consulting Group, Inc. (a)
400,000
14,036
Monster Worldwide, Inc. (a)
207,400
8,848
Robert Half International, Inc.
309,300
12,991
The Brink's Co.
54,600
3,080
57,316
Common Stocks - continued
Shares
Value (Note 1) (000s)
INDUSTRIALS - continued
Construction & Engineering - 0.3%
Jacobs Engineering Group, Inc. (a)
237,500
$ 18,915
URS Corp. (a)
28,000
1,176
20,091
Electrical Equipment - 1.3%
Cooper Industries Ltd. Class A
530,600
49,303
Energy Conversion Devices, Inc. (a)
16,100
587
Evergreen Solar, Inc. (a)
452,900
5,879
GrafTech International Ltd. (a)
500,000
2,900
Q-Cells AG
114,300
9,615
Roper Industries, Inc.
87,100
4,072
SolarWorld AG (d)
188,000
11,801
Suntech Power Holdings Co. Ltd. sponsored ADR
121,000
3,418
Ultralife Batteries, Inc. (a)(d)
39,000
395
87,970
Industrial Conglomerates - 0.6%
3M Co.
449,100
36,274
Hutchison Whampoa Ltd.
301,000
2,748
Siemens AG sponsored ADR
33,200
2,882
41,904
Machinery - 2.4%
Caterpillar, Inc.
376,200
28,019
Cummins, Inc.
121,500
14,853
Danaher Corp.
754,377
48,522
IDEX Corp.
543,700
25,663
Joy Global, Inc.
363,757
18,948
PACCAR, Inc.
326,366
26,886
162,891
Marine - 0.1%
American Commercial Lines, Inc.
123,300
7,429
Road & Rail - 0.8%
Canadian National Railway Co.
494,700
21,609
CSX Corp.
10,300
726
Heartland Express, Inc.
182,533
3,266
Knight Transportation, Inc.
58,130
1,174
Landstar System, Inc.
112,900
5,332
Norfolk Southern Corp.
44,800
2,384
Common Stocks - continued
Shares
Value (Note 1) (000s)
INDUSTRIALS - continued
Road & Rail - continued
Swift Transportation Co., Inc. (a)
257,100
$ 8,165
Universal Truckload Services, Inc. (a)
469,903
16,038
58,694
Trading Companies & Distributors - 0.3%
Fastenal Co.
147,500
5,943
Mitsui & Co. Ltd.
1,102,000
15,563
21,506
TOTAL INDUSTRIALS
618,960
INFORMATION TECHNOLOGY - 19.9%
Communications Equipment - 1.8%
CommScope, Inc. (a)
25,500
801
Corning, Inc. (a)
540,300
13,070
ECI Telecom Ltd. (a)
228,900
1,845
F5 Networks, Inc. (a)
94,700
5,065
InterDigital Communication Corp. (a)
42,500
1,484
Ixia (a)
354,600
3,191
Nice Systems Ltd. sponsored ADR (a)
503,500
14,168
Nokia Corp. sponsored ADR
1,585,100
32,114
QUALCOMM, Inc.
1,291,800
51,762
TANDBERG Television ASA (a)
55,000
912
124,412
Computers & Peripherals - 3.8%
Apple Computer, Inc. (a)
1,218,300
69,589
Dell, Inc. (a)
192,400
4,696
Hewlett-Packard Co.
5,050,900
160,013
Network Appliance, Inc. (a)
713,860
25,199
Seagate Technology
222,900
5,046
264,543
Electronic Equipment & Instruments - 0.9%
Agilent Technologies, Inc. (a)
1,800
57
Amphenol Corp. Class A
237,500
13,291
Hon Hai Precision Industry Co. Ltd. (Foxconn)
459,104
2,836
Identix, Inc. (a)
19,300
135
Itron, Inc. (a)
80,100
4,747
KEMET Corp. (a)
1,000,000
9,220
LoJack Corp. (a)
300,000
5,658
Mettler-Toledo International, Inc. (a)
72,800
4,409
Common Stocks - continued
Shares
Value (Note 1) (000s)
INFORMATION TECHNOLOGY - continued
Electronic Equipment & Instruments - continued
Motech Industries, Inc.
395,935
$ 9,318
National Instruments Corp.
490,000
13,426
Sunpower Corp. Class A
6,200
174
Viisage Technology, Inc. (a)
7,300
111
63,382
Internet Software & Services - 5.7%
Akamai Technologies, Inc. (a)
648,000
23,451
aQuantive, Inc. (a)
142,800
3,617
Google, Inc. Class A (sub. vtg.) (a)
674,400
282,799
j2 Global Communications, Inc. (a)
133,000
4,152
LoopNet, Inc. (a)
13,000
242
NetEase.com, Inc. sponsored ADR (a)(d)
223,000
4,980
Tom Online, Inc. sponsored ADR (a)(d)
52,500
1,013
WebSideStory, Inc. (a)(d)
446,056
5,442
Yahoo!, Inc. (a)
2,078,300
68,584
394,280
IT Services - 2.1%
Alliance Data Systems Corp. (a)
298,900
17,581
CheckFree Corp. (a)(d)
387,200
19,190
Cognizant Technology Solutions Corp. Class A (a)
471,000
31,731
First Data Corp.
401,700
18,093
Global Payments, Inc.
54,300
2,636
Infosys Technologies Ltd. sponsored ADR
82,700
6,319
Mastercard, Inc. Class A
265,500
12,744
MoneyGram International, Inc.
29,200
991
Paychex, Inc.
86,900
3,387
SRA International, Inc. Class A (a)
201,561
5,368
TALX Corp.
412,500
9,021
The BISYS Group, Inc. (a)
46,500
637
VeriFone Holdings, Inc. (a)
583,800
17,794
145,492
Office Electronics - 0.0%
Canon, Inc.
36,800
1,798
Zebra Technologies Corp. Class A (a)
19,600
670
2,468
Semiconductors & Semiconductor Equipment - 4.4%
Applied Materials, Inc.
693,200
11,285
ASML Holding NV (NY Shares) (a)
764,800
15,464
Broadcom Corp. Class A (a)
676,600
20,332
Common Stocks - continued
Shares
Value (Note 1) (000s)
INFORMATION TECHNOLOGY - continued
Semiconductors & Semiconductor Equipment - continued
FormFactor, Inc. (a)
416,100
$ 18,571
Freescale Semiconductor, Inc. Class A (a)
11,000
319
Hittite Microwave Corp.
93,100
3,366
Lam Research Corp. (a)
808,100
37,674
Linear Technology Corp.
78,900
2,642
Marvell Technology Group Ltd. (a)
1,900,600
84,254
MathStar, Inc.
10,000
59
MEMC Electronic Materials, Inc. (a)
326,400
12,240
Microchip Technology, Inc.
63,900
2,144
Monolithic Power Systems, Inc. (a)
86,184
1,020
National Semiconductor Corp.
633,800
15,116
O2Micro International Ltd. sponsored ADR (a)
3,000
23
Renewable Energy Corp. AS
191,300
2,736
Saifun Semiconductors Ltd.
50,000
1,433
Samsung Electronics Co. Ltd.
102,062
64,871
SiRF Technology Holdings, Inc. (a)
285,500
9,199
Zoran Corp. (a)
17,000
414
303,162
Software - 1.2%
Adobe Systems, Inc. (a)
519,006
15,757
Amdocs Ltd. (a)
37,700
1,380
Citrix Systems, Inc. (a)
112,900
4,532
ECtel Ltd. (a)
5,649
25
Informatica Corp. (a)
18,000
237
Intuit, Inc. (a)
443,177
26,763
JDA Software Group, Inc. (a)
400,000
5,612
NAVTEQ Corp. (a)
179,530
8,021
NDS Group PLC sponsored ADR (a)
21,200
987
Salesforce.com, Inc. (a)
140,700
3,751
SAP AG sponsored ADR
246,800
12,962
80,027
TOTAL INFORMATION TECHNOLOGY
1,377,766
MATERIALS - 7.8%
Chemicals - 1.2%
Arkema sponsored ADR (a)
9,210
356
Bayer AG
242,500
11,133
Ecolab, Inc.
698,800
28,357
Lonza Group AG
8,756
601
Common Stocks - continued
Shares
Value (Note 1) (000s)
MATERIALS - continued
Chemicals - continued
Monsanto Co.
142,300
$ 11,980
Praxair, Inc.
490,200
26,471
Wacker Chemie AG
15,900
1,712
80,610
Construction Materials - 0.0%
Rinker Group Ltd.
169,281
2,062
Metals & Mining - 6.6%
Agnico-Eagle Mines Ltd.
231,700
7,682
Alamos Gold, Inc. (a)(d)
1,010,000
8,143
Allegheny Technologies, Inc.
56,400
3,905
Anglo American PLC ADR
1,392,900
28,471
Aquarius Platinum Ltd. (Australia)
598,000
8,777
Bema Gold Corp. (a)
2,517,400
12,561
BHP Billiton Ltd. sponsored ADR
1,199,500
51,662
Companhia Vale do Rio Doce sponsored ADR
102,000
2,452
Eldorado Gold Corp. (a)
608,400
2,954
First Quantum Minerals Ltd.
786,400
35,252
Gabriel Resources Ltd. (a)
725,700
1,879
Gerdau SA sponsored ADR
226,450
3,376
Glamis Gold Ltd. (a)
2,465,757
93,479
Goldcorp, Inc.
951,475
28,681
IPSCO, Inc.
129,000
12,350
Ivanhoe Mines Ltd. (a)
488,000
3,305
Lihir Gold Ltd. (a)
990,100
2,119
Meridian Gold, Inc. (a)
159,600
5,035
New Gold, Inc. (a)
466,300
4,152
New Gold, Inc. warrants 2/23/08 (a)
65,000
111
Newmont Mining Corp.
948,900
50,225
Novagold Resources, Inc. (a)
196,900
2,524
Nucor Corp.
383,200
20,789
Oregon Steel Mills, Inc. (a)
46,000
2,330
POSCO sponsored ADR
248,600
16,631
Rio Tinto PLC (Reg.)
853,200
44,731
Steel Dynamics, Inc.
82,400
5,417
Teck Cominco Ltd. Class B (sub. vtg.)
33,400
2,004
US Gold Corp. (subscription receipt) (a)(g)
112,300
1,128
462,125
TOTAL MATERIALS
544,797
Common Stocks - continued
Shares
Value (Note 1) (000s)
TELECOMMUNICATION SERVICES - 3.0%
Diversified Telecommunication Services - 0.5%
AT&T, Inc.
509,100
$ 14,199
BT Group PLC sponsored ADR
63,600
2,817
Qwest Communications International, Inc. (a)
1,801,900
14,577
Telenor ASA
190,800
2,307
33,900
Wireless Telecommunication Services - 2.5%
America Movil SA de CV Series L sponsored ADR
3,156,400
104,982
American Tower Corp. Class A (a)
59,527
1,852
China Mobile (Hong Kong) Ltd. sponsored ADR
300,600
8,600
Hutchison Telecommunications International Ltd. sponsored ADR (a)(d)
147,300
3,522
Leap Wireless International, Inc. (a)
86,100
4,085
NII Holdings, Inc. (a)
951,647
53,654
176,695
TOTAL TELECOMMUNICATION SERVICES
210,595
UTILITIES - 0.6%
Electric Utilities - 0.1%
Exelon Corp.
82,800
4,706
FirstEnergy Corp.
89,100
4,830
9,536
Gas Utilities - 0.1%
Southern Union Co.
226,875
6,139
Independent Power Producers & Energy Traders - 0.3%
AES Corp. (a)
719,600
13,277
International Power PLC
264,200
1,390
TXU Corp.
71,000
4,245
18,912
Multi-Utilities - 0.1%
National Grid PLC
554,900
6,004
Veolia Environnement
26,900
1,391
7,395
TOTAL UTILITIES
41,982
TOTAL COMMON STOCKS
(Cost $5,702,251)
6,385,219
Convertible Preferred Stocks - 0.1%
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - 0.1%
Automobiles - 0.1%
General Motors Corp. Series B, 5.25%
310,900
$ 5,693
TOTAL CONVERTIBLE PREFERRED STOCKS
(Cost $5,152)
5,693
Money Market Funds - 9.8%
Fidelity Cash Central Fund, 5.11% (b)
598,552,930
598,553
Fidelity Securities Lending Cash Central Fund, 5.14% (b)(c)
81,361,352
81,361
TOTAL MONEY MARKET FUNDS
(Cost $679,914)
679,914
TOTAL INVESTMENT PORTFOLIO - 101.9%
(Cost $6,387,317)
7,070,826
NET OTHER ASSETS - (1.9)%
(132,079)
NET ASSETS - 100%
$ 6,938,747
Legend
(a) Non-income producing
(b) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.
(c) Investment made with cash collateral received from securities on loan.
(d) Security or a portion of the security is on loan at period end.
(e) Affiliated company
(f) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the period end, the value of these securities amounted to $388,000 or 0.0% of net assets.
(g) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $3,786,000 or 0.1% of net assets.
Additional information on each holding is as follows:
Security
Acquisition Date
Acquisition Cost (000s)
MannKind Corp. warrants 8/3/10
8/3/05
$ 1
The Weinstein Co. III Holdings, LLC Class A-1
10/19/05
$ 2,267
US Gold Corp. (subscription receipt)
2/8/06
$ 505
Affiliated Central Funds
Information regarding fiscal year to date income earned by the fund from the affiliated Central funds is as follows:
Fund
Income earned (Amounts in thousands)
Fidelity Cash Central Fund
$ 17,778
Fidelity Securities Lending Cash Central Fund
482
Total
$ 18,260
Other Affiliated Issuers
An affiliated company is a company in which the fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliates (Amounts in thousands)
Value, beginning of period
Purchases
Sales Proceeds
Dividend Income
Value, end of period
Bakers Footwear Group, Inc.
$ 7,130
$ 3,181
$ -
$ -
$ 8,633
Preferred Bank, Los Angeles California
-
19,483
-
39
20,372
TOTALS
$ 7,130
$ 22,664
$ -
$ 39
$ 29,005
Other Information
Distribution of investments by country of issue, as a percentage of total net assets, is as follows:
United States of America
72.7%
Canada
7.0%
United Kingdom
3.5%
Bermuda
2.3%
Switzerland
2.3%
Netherlands Antilles
1.8%
Japan
1.6%
Mexico
1.5%
Korea (South)
1.1%
Others (individually less than 1%)
6.2%
100.0%
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts)
June 30, 2006 (Unaudited)
Assets
Investment in securities, at value (including securities loaned of $79,918) - See accompanying schedule:
Unaffiliated issuers (cost $5,678,277)
$ 6,361,907
Affiliated Central Funds (cost $679,914)
679,914
Other affiliated issuers (cost $29,126)
29,005
Total Investments (cost $6,387,317)
$ 7,070,826
Cash
1
Foreign currency held at value (cost $15,243)
15,243
Receivable for investments sold
27,481
Receivable for fund shares sold
6,182
Dividends receivable
4,374
Interest receivable
3,346
Prepaid expenses
4
Other receivables
264
Total assets
7,127,721
Liabilities
Payable for investments purchased
$ 93,837
Payable for fund shares redeemed
5,812
Accrued management fee
3,184
Distribution fees payable
2,743
Other affiliated payables
1,428
Other payables and accrued expenses
609
Collateral on securities loaned, at value
81,361
Total liabilities
188,974
Net Assets
$ 6,938,747
Net Assets consist of:
Paid in capital
$ 6,264,721
Undistributed net investment income
1,674
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions
(11,049)
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies
683,401
Net Assets
$ 6,938,747
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Assets and Liabilities - continued
Amounts in thousands (except per-share amounts)
June 30, 2006 (Unaudited)
Calculation of Maximum Offering Price Class A: Net Asset Value and redemption price per share ($1,683,204 ÷ 97,640 shares)
$ 17.24
Maximum offering price per share (100/94.25 of $17.24)
$ 18.29
Class T: Net Asset Value and redemption price per share ($2,013,614 ÷ 117,454 shares)
$ 17.14
Maximum offering price per share (100/96.50 of $17.14)
$ 17.76
Class B: Net Asset Value and offering price per share ($448,712 ÷ 26,611 shares)A
$ 16.86
Class C: Net Asset Value and offering price per share ($1,513,890 ÷ 89,640 shares)A
$ 16.89
Institutional Class: Net Asset Value, offering price and redemption price per share ($1,279,327 ÷ 73,528 shares)
$ 17.40
A Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Statement of Operations
Amounts in thousands
Six months ended June 30, 2006 (Unaudited)
Investment Income
Dividends (including $39 received from other affiliated issuers)
$ 24,406
Interest
92
Income from affiliated Central Funds
18,260
Total income
42,758
Expenses
Management fee
$ 17,029
Transfer agent fees
7,140
Distribution fees
15,241
Accounting and security lending fees
603
Independent trustees' compensation
11
Custodian fees and expenses
383
Registration fees
904
Audit
41
Legal
29
Interest
4
Miscellaneous
130
Total expenses before reductions
41,515
Expense reductions
(465)
41,050
Net investment income (loss)
1,708
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investment securities:
Unaffiliated issuers (net of foreign taxes of $19)
(4,213)
Foreign currency transactions
309
Total net realized gain (loss)
(3,904)
Change in net unrealized appreciation (depreciation) on:
Investment securities (net of decrease in deferred foreign taxes of $11)
132,697
Assets and liabilities in foreign currencies
(108)
Total change in net unrealized appreciation (depreciation)
132,589
Net gain (loss)
128,685
Net increase (decrease) in net assets resulting from operations
$ 130,393
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Changes in Net Assets
Amounts in thousands
Six months ended June 30, 2006 (Unaudited)
Year ended December 31, 2005
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)
$ 1,708
$ (3,298)
Net realized gain (loss)
(3,904)
15,438
Change in net unrealized appreciation (depreciation)
132,589
426,567
Net increase (decrease) in net assets resulting from operations
130,393
438,707
Distributions to shareholders from net realized gain
(14,806)
-
Share transactions - net increase (decrease)
2,568,102
2,787,029
Total increase (decrease) in net assets
2,683,689
3,225,736
Net Assets
Beginning of period
4,255,058
1,029,322
End of period (including undistributed net investment income of $1,674 and accumulated net investment loss of $34, respectively)
$ 6,938,747
$ 4,255,058
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class A
Six month ended June 30,2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.65
$ 13.99
$ 11.79
$ 10.00
Income from Investment Operations
Net investment income (loss) E
.02
.02
(.03)
(.04)
Net realized and unrealized gain (loss)
.62
2.64
2.24
1.87
Total from investment operations
.64
2.66
2.21
1.83
Distributions from net investment income
-
-
(.01)
(.03)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.04)
Net asset value, end of period
$ 17.24
$ 16.65
$ 13.99
$ 11.79
Total ReturnB, C, D
3.84%
19.01%
18.76%
18.23%
Ratios to Average Net AssetsG
Expenses before reductions
1.14% A
1.17%
1.22%
1.39% A
Expenses net of fee waivers, if any
1.14% A
1.17%
1.22%
1.39% A
Expenses net of all reductions
1.13% A
1.13%
1.17%
1.28% A
Net investment income (loss)
.29% A
.13%
(.26)%
(.81)% A
Supplemental Data
Net assets, end of period (in millions)
$ 1,683
$ 1,019
$ 230
$ 37
Portfolio turnover rate
82% A
65%
87%
77% A
AAnnualized
BTotal returns for periods of less than one year are not annualized.
CTotal returns would have been lower had certain expenses not been reduced during the periods shown.
DTotal returns do not include the effect of the sales charges.
ECalculated based on average shares outstanding during the period.
FFor the period July 31, 2003 (commencement of operations) to December 31, 2003.
GExpense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class T
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.57
$ 13.96
$ 11.78
$ 10.00
Income from Investment Operations
Net investment income (loss) E
.01
(.01)
(.06)
(.05)
Net realized and unrealized gain (loss)
.61
2.62
2.25
1.86
Total from investment operations
.62
2.61
2.19
1.81
Distributions from net investment income
-
-
(.01)
(.02)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.03)
Net asset value, end of period
$ 17.14
$ 16.57
$ 13.96
$ 11.78
Total ReturnB, C, D
3.74%
18.70%
18.60%
18.08%
Ratios to Average Net AssetsG
Expenses before reductions
1.34% A
1.38%
1.43%
1.62% A
Expenses net of fee waivers, if any
1.34% A
1.38%
1.43%
1.62% A
Expenses net of all reductions
1.32% A
1.34%
1.39%
1.51% A
Net investment income (loss)
.09% A
(.08)%
(.48)%
(1.04)% A
Supplemental Data
Net assets, end of period (in millions)
$ 2,014
$ 1,393
$ 325
$ 62
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Total returns do not include the effect of the sales charges.
E Calculated based on average shares outstanding during the period.
F For the period July 31, 2003 (commencement of operations) to December 31, 2003.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class B
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.35
$ 13.85
$ 11.76
$ 10.00
Income from Investment Operations
Net investment income (loss) E
(.04)
(.10)
(.13)
(.07)
Net realized and unrealized gain (loss)
.60
2.60
2.23
1.85
Total from investment operations
.56
2.50
2.10
1.78
Distributions from net investment income
-
-
(.01)
(.01)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.02)
Net asset value, end of period
$ 16.86
$ 16.35
$ 13.85
$ 11.76
Total ReturnB, C, D
3.42%
18.05%
17.87%
17.75%
Ratios to Average Net AssetsG
Expenses before reductions
1.95% A
1.98%
2.02%
2.19% A
Expenses net of fee waivers, if any
1.95% A
1.98%
2.02%
2.19% A
Expenses net of all reductions
1.93% A
1.94%
1.97%
2.08% A
Net investment income (loss)
(.52)% A
(.68)%
(1.06)%
(1.61)% A
Supplemental Data
Net assets, end of period (in millions)
$ 449
$ 339
$ 109
$ 27
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Calculated based on average shares outstanding during the period.
F For the period July 31, 2003 (commencement of operations) to December 31, 2003.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Class C
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003F
Selected Per-Share Data
Net asset value, beginning of period
$ 16.37
$ 13.86
$ 11.76
$ 10.00
Income from Investment Operations
Net investment income (loss) E
(.04)
(.09)
(.12)
(.07)
Net realized and unrealized gain (loss)
.61
2.60
2.23
1.85
Total from investment operations
.57
2.51
2.11
1.78
Distributions from net investment income
-
-
(.01)
(.01)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.02)
Net asset value, end of period
$ 16.89
$ 16.37
$ 13.86
$ 11.76
Total ReturnB, C, D
3.48%
18.11%
17.95%
17.77%
Ratios to Average Net AssetsG
Expenses before reductions
1.86% A
1.89%
1.94%
2.14% A
Expenses net of fee waivers, if any
1.86% A
1.89%
1.94%
2.14% A
Expenses net of all reductions
1.85% A
1.85%
1.89%
2.03% A
Net investment income (loss)
(.43)% A
(.59)%
(.98)%
(1.55)% A
Supplemental Data
Net assets, end of period (in millions)
$ 1,514
$ 1,006
$ 246
$ 49
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Total returns do not include the effect of the contingent deferred sales charge.
E Calculated based on average shares outstanding during the period.
F For the period July 31, 2003 (commencement of operations) to December 31, 2003.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights - Institutional Class
Six months ended June 30, 2006
Years ended December 31,
(Unaudited)
2005
2004
2003E
Selected Per-Share Data
Net asset value, beginning of period
$ 16.78
$ 14.05
$ 11.79
$ 10.00
Income from Investment Operations
Net investment income (loss) D
.05
.07
.01
(.02)
Net realized and unrealized gain (loss)
.62
2.66
2.26
1.86
Total from investment operations
.67
2.73
2.27
1.84
Distributions from net investment income
-
-
(.01)
(.04)
Distributions from net realized gain
(.05)
-
-
(.01)
Total distributions
(.05)
-
(.01)
(.05)
Net asset value, end of period
$ 17.40
$ 16.78
$ 14.05
$ 11.79
Total ReturnB, C
3.99%
19.43%
19.27%
18.31%
Ratios to Average Net AssetsF
Expenses before reductions
.85% A
.84%
.86%
1.07% A
Expenses net of fee waivers, if any
.85% A
.84%
.86%
1.07% A
Expenses net of all reductions
.84% A
.79%
.82%
.96% A
Net investment income (loss)
.58% A
.47%
.10%
(.49)% A
Supplemental Data
Net assets, end of period (in millions)
$ 1,279
$ 498
$ 120
$ 23
Portfolio turnover rate
82% A
65%
87%
77% A
A Annualized
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Calculated based on average shares outstanding during the period.
E For the period July 31, 2003 (commencement of operations) to December 31, 2003.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Notes to Financial Statements
For the period ended June 30, 2006 (Unaudited)
(Amounts in thousands except ratios)
1. Significant Accounting Policies.
Fidelity Advisor New Insights Fund (the Fund) is a fund of Fidelity Contrafund (the trust) and is authorized to issue an unlimited number of shares. Effective the close of business on April 28, 2006, the Fund was closed to most new accounts. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust.
The Fund offers Class A, Class T, Class B, Class C, and Institutional Class shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class. Class B shares will automatically convert to Class A shares after a holding period of seven years from the initial date of purchase. Investment income, realized and unrealized capital gains and losses, the common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated on a pro rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.
The Fund may invest in affiliated money market central funds (Money Market Central Funds), which are open-end investment companies available to investment companies and other accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, 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 Fund:
Security Valuation. Investments are valued and net asset value (NAV) per share is calculated (NAV calculation) as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time. Wherever possible, the Fund uses independent pricing services approved by the Board of Trustees to value its investments.
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Investments in open-end mutual funds are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
1. Significant Accounting Policies - continued
Security Valuation - continued
When current market prices or quotations are not readily available or do not accurately reflect fair value, valuations may be determined in accordance with procedures adopted by the Board of Trustees. For example, when developments occur between the close of a market and the close of the NYSE that may materially affect the value of some or all of the securities, or when trading in a security is halted, those securities may be fair valued. Factors used in the determination of fair value may include monitoring news to identify significant market or security specific events such as changes in the value of U.S. securities markets, reviewing developments in foreign markets and evaluating the performance of ADRs, futures contracts and exchange-traded funds. Because the Fund's utilization of fair value pricing depends on market activity, the frequency with which fair value pricing is used can not be predicted and may be utilized to a significant extent. The value of securities used for NAV calculation under fair value pricing may differ from published prices for the same securities.
Foreign Currency. The Fund uses foreign currency contracts to facilitate transactions in foreign-denominated securities. Losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rate at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. Security transactions are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income is accrued as
Semiannual Report
1. Significant Accounting Policies - continued
Investment Transactions and Income - continued
earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code. As a result, no provision for income taxes is required in the accompanying financial statements. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are recorded on the ex-dividend date. Income dividends and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, passive foreign investment companies (PFIC), market discount, net operating losses, capital loss carryforwards, and losses deferred due to wash sales.
The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:
Unrealized appreciation
$ 821,135
Unrealized depreciation
(147,182)
Net unrealized appreciation (depreciation)
$ 673,953
Cost for federal income tax purposes
$ 6,396,873
New Accounting Pronouncement. In July 2006, Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement 109 (FIN 48)was issued and is effective for fiscal years beginning after December 15, 2006. FIN 48 sets forth a threshold for financial statement recognition, measurement and disclosure of a tax position taken or expected to be taken on a tax return. Management is currently evaluating the impact, if any, the adoption of FIN 48 will have on the Fund's net assets and results of operations.
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
2. Operating Policies.
Repurchase Agreements. FMR has received an Exemptive Order from the Securities and Exchange Commission (the SEC) which permits the Fund and other affiliated entities of FMR to transfer uninvested cash balances into joint trading accounts which are then invested in repurchase agreements. The Fund may also invest directly with institutions in repurchase agreements. Repurchase agreements are collateralized by government or non-government securities. Upon settlement date, collateral is held in segregated accounts with custodian banks and may be obtained in the event of a default of the counterparty. The Fund monitors, on a daily basis, the value of the collateral to ensure it is at least equal to the principal amount of the repurchase agreement (including accrued interest). In the event of a default by the counterparty, realization of the collateral proceeds could be delayed, during which time the value of the collateral may decline.
Restricted Securities. The Fund may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of the Fund's Schedule of Investments.
3. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and U.S. government securities, aggregated $4,589,558 and $2,152,598, respectively.
4. Fees and Other Transactions with Affiliates.
Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and a group fee rate that averaged ..27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .57% of the Fund's average net assets.
Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has adopted separate Distribution and Service Plans for each class of shares. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of FMR, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for
Semiannual Report
4. Fees and Other Transactions with Affiliates - continued
Distribution and Service Plan - continued
selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates and the total amounts paid to and retained by FDC were as follows:
Distribution Fee
Service Fee
Paid to FDC
Retained by FDC
Class A
0%
.25%
$ 1,821
$ 82
Class T
.25%
.25%
4,542
340
Class B
.75%
.25%
2,091
1,571
Class C
.75%
.25%
6,787
4,175
$ 15,241
$ 6,168
Sales Load. FDC receives a front-end sales charge of up to 5.75% for selling Class A shares, and 3.50% for selling Class T shares, some of which is paid to financial intermediaries for selling shares of the Fund. FDC receives the proceeds of contingent deferred sales charges levied on Class A, Class T, Class B, and Class C redemptions. These charges depend on the holding period. The deferred sales charges range from 5% to 1% for Class B, 1% for Class C, 1.00% to .50% for certain purchases of Class A shares (.25% prior to February 24, 2006) and .25% for certain purchases of Class T shares.
For the period, sales charge amounts retained by FDC were as follows:
Retained by FDC
Class A
$ 1,885
Class T
440
Class B*
282
Class C*
153
$ 2,760
* When Class B and Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of the respective classes of the Fund. FIIOC pays for typesetting, printing and mailing of
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
4. Fees and Other Transactions with Affiliates - continued
Transfer Agent Fees - continued
shareholder reports, except proxy statements. For the period the total transfer agent fees paid by each class to FIIOC, were as follows:
Amount
% of Average Net Assets
Class A
$ 1,900
.26*
Class T
1,898
.21*
Class B
665
.32*
Class C
1,595
.23*
Institutional Class
1,082
.22*
$ 7,140
* Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for the month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions.
Affiliated Central Funds. The Fund may invest in Money Market Central Funds which seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.
The Money Market Central Funds do not pay a management fee.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $14 for the period.
5. Committed Line of Credit.
The Fund participates with other funds managed by FMR in a $4.2 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro rata portion of the line of credit, which amounts to $6 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.
Semiannual Report
6. Security Lending.
The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. If the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, a fund could experience delays and costs in recovering the securities loaned or in gaining access to the collateral. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Net income from lending portfolio securities during the period amounted to $482.
7. Bank Borrowings.
The Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. The Fund has established borrowing arrangements with certain banks. The interest rate on the borrowings is the bank's base rate, as revised from time to time. The average daily loan balance during the period for which loans were outstanding amounted to $27,763. The weighted average interest rate was 5.31%. At period end, there were no bank borrowings outstanding.
8. Expense Reductions.
Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $452 for the period. In addition, through arrangements with the Fund's custodian and each class' transfer agent, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
8. Expense Reductions - continued
the period, these credits reduced the Fund's custody expenses by $2. During the period, credits reduced each class' transfer agent expense as noted in the table below.
Transfer Agent expense reduction
Class A
$ 3
Class T
5
Institutional Class
3
$ 11
9. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
10. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended June 30, 2006
Year ended December 31, 2005
From net realized gain
Class A
$ 3,604
$ -
Class T
4,694
-
Class B
1,130
-
Class C
3,506
-
Institutional Class
1,872
-
Total
$ 14,806
$ -
Semiannual Report
11. Share Transactions.
Transactions for each class of shares were as follows:
Shares
Dollars
Six months ended June 30, 2006
Year ended December 31, 2005
Six months ended June 30, 2006
Year ended December 31, 2005
Class A
Shares sold
43,726
48,615
$ 758,679
$ 747,881
Reinvestment of distributions
186
-
3,201
-
Shares redeemed
(7,489)
(3,868)
(128,194)
(58,730)
Net increase (decrease)
36,423
44,747
$ 633,686
$ 689,151
Class T
Shares sold
41,187
65,661
$ 711,835
$ 990,175
Reinvestment of distributions
260
-
4,446
-
Shares redeemed
(8,035)
(4,899)
(137,559)
(73,812)
Net increase (decrease)
33,412
60,762
$ 578,722
$ 916,363
Class B
Shares sold
8,061
14,492
$ 137,365
$ 215,896
Reinvestment of distributions
56
-
941
-
Shares redeemed
(2,254)
(1,584)
(38,052)
(23,549)
Net increase (decrease)
5,863
12,908
$ 100,254
$ 192,347
Class C
Shares sold
32,227
46,847
$ 549,551
$ 703,988
Reinvestment of distributions
154
-
2,604
-
Shares redeemed
(4,215)
(3,110)
(70,486)
(46,058)
Net increase (decrease)
28,166
43,737
$ 481,669
$ 657,930
Institutional Class
Shares sold
50,637
22,374
$ 891,242
$ 349,673
Reinvestment of distributions
69
-
1,201
-
Shares redeemed
(6,852)
(1,206)
(118,672)
(18,435)
Net increase (decrease)
43,854
21,168
$ 773,771
$ 331,238
Semiannual Report
Board Approval of Investment Advisory Contracts and Management Fees
Advisor New Insights Fund
On January 19, 2006, the Board of Trustees, including the Independent Trustees (together, the Board), voted to approve a general research services agreement (the Agreement) between FMR, FMR Co., Inc. (FMRC), Fidelity Investments Money Management, Inc. (FIMM), and Fidelity Research & Analysis Company (FRAC) (together, the Investment Advisers) for the fund, effective January 20, 2006, pursuant to which FRAC may provide general research and investment advisory support services to FMRC and FIMM. The Board considered that it has approved previously various sub-advisory agreements for the fund with affiliates of FMR that allow FMR to obtain research, non-discretionary advice, or discretionary portfolio management at no additional expense to the fund. The Board, assisted by the advice of fund counsel and independent Trustees' counsel, considered a broad range of information and determined that it would be beneficial for the fund to access the research and investment advisory support services supplied by FRAC at no additional expense to the fund.
The Board reached this determination in part because the new arrangement will involve no changes in (i) the contractual terms of and fees payable under the fund's management contract or sub-advisory agreements; (ii) the investment process or strategies employed in the management of the fund's assets; (iii) the nature or level of services provided under the fund's management contract or sub-advisory agreements; (iv) the day-to-day management of the fund or the persons primarily responsible for such management; or (v) the ultimate control or beneficial ownership of FMR, FMRC, or FIMM. The Board also considered that the establishment of the Agreement would not necessitate prior shareholder approval of the Agreement or result in an assignment and termination of the fund's management contract or sub-advisory agreements under the Investment Company Act of 1940.
Because the Board was approving an arrangement with FRAC under which the fund will not bear any additional management fees or expenses and under which the fund's portfolio manager would not change, it did not consider the fund's investment performance, competitiveness of management fee and total expenses, costs of services and profitability, or economies of scale to be significant factors in its decision.
In connection with its future renewal of the fund's management contract and sub-advisory agreements, the Board will consider: (i) the nature, extent, and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the fund's management fee and total expenses; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred by Fidelity in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders; and (iv) whether there have been economies of scale in respect of the management of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is potential for realization of any further economies.
Semiannual Report
Board Approval of Investment Advisory Contracts and Management Fees - continued
Based on its evaluation of all of the conclusions noted above, and after considering all material factors, the Board ultimately concluded that the fund's Agreement is fair and reasonable, and that the fund's Agreement should be approved.
Semiannual Report
Semiannual Report
Semiannual Report
Investment Adviser
Fidelity Management & Research Company
Boston, MA
Investment Sub-Adviser
FMR Co., Inc.
Fidelity Management & Research (U.K.) Inc.
Fidelity Research & Analysis Company (formerly Fidelity Management & Research (Far East) Inc.)
Fidelity Investments Japan Limited
Fidelity International Investment Advisors
Fidelity International Investment Advisors (U.K.) Limited
General Distributor
Fidelity Distributors Corporation
Boston, MA
Transfer and Service Agents
Fidelity Investments Institutional Operations Company, Inc.
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at www.sec.gov. You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR Corp. or an affiliated company.
Semiannual Report
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.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC's web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. For a complete list of a fund's portfolio holdings, view the most recent quarterly holdings report, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com/holdings.
NOT FDIC INSURED · MAY LOSE VALUE · NO BANK GUARANTEE
Neither the fund nor Fidelity Distributors Corporation is a bank.
Semiannual Report
Chairman's Message
(photo_of_Edward_C_Johnson_3d)
Dear Shareholder:
Although many securities markets made gains in early 2006, inflation concerns led to mixed results through the year's mid-point. Financial markets are always unpredictable. There are, however, a number of time-tested principles that can put the historical odds in your favor.
One of the basic tenets is to invest for the long term. Over time, riding out the markets' inevitable ups and downs has proven much more effective than selling into panic or chasing the hottest trend. Even missing only a few of the markets' best days can significantly diminish investor returns. Patience also affords the benefits of compounding - of earning interest on additional income or reinvested dividends and capital gains. There are tax advantages and cost benefits to consider as well. The more you sell, the more taxes you pay, and the more you trade, the higher the costs. While staying the course doesn't eliminate risk, it can considerably lessen the effect of short-term declines.
You can further manage your investing risk through diversification. And today, more than ever, geographic diversification should be taken into account. Studies indicate that asset allocation is the single most important determinant of a portfolio's long-term success. The right mix of stocks, bonds and cash - aligned to your particular risk tolerance and investment objective - is very important. Age-appropriate rebalancing is also an essential aspect of asset allocation. For younger investors, an emphasis on equities - which historically have been the best performing asset class over time - is encouraged. As investors near their specific goal, such as retirement or sending a child to college, consideration may be given to replacing volatile assets (e.g. common stocks) with more-stable fixed investments (bonds or savings plans).
A third investment principle - investing regularly - can help lower the average cost of your purchases. Investing a certain amount of money each month or quarter helps ensure you won't pay for all your shares at market highs. This strategy - known as dollar cost averaging - also reduces unconstructive "emotion" from investing, helping shareholders avoid selling weak performers just prior to an upswing, or chasing a hot performer just before a correction.
We invite you to contact us via the Internet, through our Investor Centers or over the phone. It is our privilege to provide you the information you need to make the investments that are right for you.
Sincerely,
/s/Edward C. Johnson 3d
Edward C. Johnson 3d
Semiannual Report
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (January 1, 2006 to June 30, 2006).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Beginning Account Value January 1, 2006
Ending Account Value June 30, 2006
Expenses Paid During Period* January 1, 2006 to June 30, 2006
Actual
$ 1,000.00
$ 1,039.50
$ 4.55
Hypothetical (5% return per year before expenses)
$ 1,000.00
$ 1,020.33
$ 4.51
* Expenses are equal to the Fund's annualized expense ratio of .90%; multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
Semiannual Report
Investment Changes
Top Ten Stocks as of June 30, 2006
% of fund's net assets
% of fund's net assets 6 months ago
Google, Inc. Class A (sub. vtg.)
3.8
3.5
Genentech, Inc.
2.4
2.9
Berkshire Hathaway, Inc. Class A
2.3
2.1
EnCana Corp.
2.2
2.6
Schlumberger Ltd. (NY Shares)
1.7
1.0
Wells Fargo & Co.
1.6
0.8
Procter & Gamble Co.
1.6
1.5
Hewlett-Packard Co.
1.6
0.7
America Movil SA de CV Series L sponsored ADR
1.5
1.3
Roche Holding AG (participation certificate)
1.4
1.3
20.1
Top Five Market Sectors as of June 30, 2006
% of fund's net assets
% of fund's net assets 6 months ago
Financials
18.1
16.6
Information Technology
17.2
17.6
Energy
11.4
11.7
Health Care
10.0
14.1
Industrials
8.9
7.8
Asset Allocation (% of fund's net assets)
As of June 30, 2006 *
As of December 31, 2005 **
Stocks 90.4%
Stocks 90.1%
Bonds 0.0%
Bonds 0.2%
Convertible Securities 0.1%
Convertible Securities 0.0%
Short-Term Investments and Net Other Assets 9.5%
Short-Term Investments and Net Other Assets 9.7%
* Foreign investments
26.5%
** Foreign investments
25.4%
Semiannual Report
Investments June 30, 2006
Showing Percentage of Net Assets
Common Stocks - 90.4%
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - 7.9%
Auto Components - 0.0%
LKQ Corp. (a)
76,201
$ 1,448
Automobiles - 0.8%
General Motors Corp. (d)
1,938,800
57,757
Harley-Davidson, Inc.
421,000
23,109
Honda Motor Co. Ltd.
1,339,000
42,607
Hyundai Motor Co.
75,190
6,388
Renault SA
211,400
22,716
Toyota Motor Corp.
7,051,200
368,743
521,320
Distributors - 0.0%
Li & Fung Ltd.
15,809,200
31,959
Diversified Consumer Services - 0.0%
Laureate Education, Inc. (a)
124,806
5,320
Hotels, Restaurants & Leisure - 1.9%
Aristocrat Leisure Ltd.
8,922,391
85,403
Chipotle Mexican Grill, Inc. Class A (e)
1,095,000
66,740
International Game Technology
991,900
37,633
Kerzner International Ltd. (a)
416,300
33,004
Las Vegas Sands Corp. (a)
3,054,000
237,784
Panera Bread Co. Class A (a)(e)
2,909,851
195,658
Penn National Gaming, Inc. (a)
1,093,969
42,424
Starbucks Corp. (a)
5,752,400
217,211
Station Casinos, Inc.
2,315,300
157,626
Tim Hortons, Inc. (d)
1,303,440
33,564
William Hill PLC
6,585,807
76,313
Wynn Resorts Ltd. (a)
925,062
67,807
1,251,167
Household Durables - 0.6%
Garmin Ltd.
1,342,621
141,566
KB Home
389,300
17,849
Matsushita Electric Industrial Co. Ltd.
4,333,800
91,573
Sharp Corp.
2,737,000
43,247
Sony Corp.
1,591,100
70,072
Whirlpool Corp.
175,400
14,497
378,804
Internet & Catalog Retail - 0.2%
Coldwater Creek, Inc. (a)
762,723
20,410
Expedia, Inc. (a)
1,296,700
19,412
Liberty Media Holding Corp. - Interactive Series A (a)
1,953,617
33,719
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - continued
Internet & Catalog Retail - continued
Submarino SA
780,500
$ 15,676
VistaPrint Ltd.
1,071,600
28,655
117,872
Leisure Equipment & Products - 0.0%
Aruze Corp.
197,800
4,304
Media - 1.6%
Focus Media Holding Ltd. ADR
633,530
41,281
Live Nation, Inc. (a)
614,000
12,501
McGraw-Hill Companies, Inc.
1,181,040
59,324
News Corp. Class B
5,534,000
111,676
Sirius Satellite Radio, Inc. (a)(d)
6,696,591
31,809
The Walt Disney Co.
24,101,806
723,054
The Weinstein Co. Holdings, LLC Class A-1 (a)(g)
41,234
41,234
Thomson Corp.
428,700
16,517
1,037,396
Multiline Retail - 0.6%
JCPenney Co., Inc.
1,654,700
111,709
Marks & Spencer Group PLC
22,103,447
239,974
Nordstrom, Inc.
826,000
30,149
Target Corp.
524,560
25,635
407,467
Specialty Retail - 1.9%
Best Buy Co., Inc.
4,594,450
251,960
Circuit City Stores, Inc.
6,333,298
172,392
Inditex SA
795,900
33,577
J. Crew Group, Inc.
2,146,700
58,927
Limited Brands, Inc.
1,809,100
46,295
O'Reilly Automotive, Inc. (a)
158,200
4,934
Office Depot, Inc. (a)
7,500,540
285,021
Payless ShoeSource, Inc. (a)
712,100
19,348
Staples, Inc.
6,196,700
150,704
The Children's Place Retail Stores, Inc. (a)
155,874
9,360
TJX Companies, Inc.
6,654,500
152,122
Tractor Supply Co. (a)
235,146
12,997
Wet Seal, Inc. Class A (a)
1,849,472
9,025
1,206,662
Textiles, Apparel & Luxury Goods - 0.3%
Burberry Group PLC
3,320,994
26,412
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER DISCRETIONARY - continued
Textiles, Apparel & Luxury Goods - continued
Coach, Inc. (a)
1,320,922
$ 39,496
Luxottica Group Spa sponsored ADR
212,400
5,762
Polo Ralph Lauren Corp. Class A
210,400
11,551
Puma AG
88,200
34,291
Under Armour, Inc. Class A (sub. vtg.)
611,600
26,066
VF Corp.
699,600
47,517
Wolverine World Wide, Inc.
204,400
4,769
195,864
TOTAL CONSUMER DISCRETIONARY
5,159,583
CONSUMER STAPLES - 6.3%
Beverages - 2.2%
Anheuser-Busch Companies, Inc.
229,700
10,472
Diageo PLC sponsored ADR
3,963,300
267,721
InBev SA
234,183
11,488
PepsiCo, Inc.
12,313,055
739,276
The Coca-Cola Co.
9,496,297
408,531
1,437,488
Food & Staples Retailing - 0.4%
Costco Wholesale Corp.
432,900
24,732
Safeway, Inc.
311,800
8,107
Tesco PLC
11,600,813
71,664
Wal-Mart de Mexico SA de CV Series V
13,413,944
36,868
Wal-Mart Stores, Inc.
2,715,100
130,786
272,157
Food Products - 1.1%
Campbell Soup Co.
369,300
13,705
General Mills, Inc.
293,800
15,178
Groupe Danone
1,255,360
159,542
Hershey Co.
3,100,800
170,761
Kellogg Co.
685,600
33,204
Nestle SA (Reg.)
473,124
148,613
Sara Lee Corp.
2,055,500
32,929
TreeHouse Foods, Inc. (a)
1,481,000
35,381
Wm. Wrigley Jr. Co.
2,037,350
92,414
701,727
Common Stocks - continued
Shares
Value (Note 1) (000s)
CONSUMER STAPLES - continued
Household Products - 2.1%
Colgate-Palmolive Co.
5,087,900
$ 304,765
Procter & Gamble Co.
18,668,670
1,037,978
1,342,743
Personal Products - 0.5%
Avon Products, Inc.
7,545,654
233,915
Estee Lauder Companies, Inc. Class A
973,100
37,630
Herbalife Ltd. (a)
2,032,900
81,113
352,658
TOTAL CONSUMER STAPLES
4,106,773
ENERGY - 11.4%
Energy Equipment & Services - 2.6%
Baker Hughes, Inc.
3,395,400
277,913
BJ Services Co.
397,100
14,796
Halliburton Co.
2,059,100
152,806
Hanover Compressor Co. (a)
193,015
3,625
Schlumberger Ltd. (NY Shares)
16,651,300
1,084,166
Smith International, Inc.
4,122,880
183,344
1,716,650
Oil, Gas & Consumable Fuels - 8.8%
Addax Petroleum Corp.
1,330,500
35,578
BG Group PLC sponsored ADR
1,175,000
78,584
BP PLC sponsored ADR
2,559,266
178,151
Cameco Corp.
857,000
34,140
Canadian Natural Resources Ltd.
977,400
54,040
Canadian Oil Sands Trust unit
8,098,800
261,181
China Petroleum & Chemical Corp. sponsored ADR (d)
641,100
36,697
CONSOL Energy, Inc.
2,723,100
127,223
EnCana Corp.
27,409,048
1,443,253
EOG Resources, Inc.
2,976,800
206,411
Exxon Mobil Corp.
7,718,200
473,512
Foundation Coal Holdings, Inc.
435,500
20,438
Goodrich Petroleum Corp. (a)
60,800
1,726
Hess Corp.
233,500
12,340
Highpine Oil & Gas Ltd. (a)(f)
355,200
5,918
Hugoton Royalty Trust
24
1
Husky Energy, Inc.
247,000
15,502
Imperial Oil Ltd.
1,011,000
36,933
Common Stocks - continued
Shares
Value (Note 1) (000s)
ENERGY - continued
Oil, Gas & Consumable Fuels - continued
Kerr-McGee Corp.
546,000
$ 37,865
Murphy Oil Corp.
8,340,000
465,872
Noble Energy, Inc.
1,730,234
81,079
Occidental Petroleum Corp.
1,368,500
140,340
Peabody Energy Corp.
2,245,400
125,181
PetroChina Co. Ltd. sponsored ADR (d)
2,996,800
323,564
Petroleo Brasileiro SA Petrobras sponsored ADR
789,400
70,501
Sasol Ltd. sponsored ADR
1,290,200
49,853
Suncor Energy, Inc.
1,507,200
121,975
Talisman Energy, Inc.
7,162,400
124,988
Total SA sponsored ADR
1,033,962
67,745
Ultra Petroleum Corp. (a)
322,300
19,103
Valero Energy Corp.
13,692,675
910,837
Western Oil Sands, Inc. Class A (a)
2,131,000
59,064
XTO Energy, Inc.
1,845,833
81,715
5,701,310
TOTAL ENERGY
7,417,960
FINANCIALS - 18.1%
Capital Markets - 0.9%
Charles Schwab Corp.
6,910,036
110,422
Goldman Sachs Group, Inc.
1,655,500
249,037
Lehman Brothers Holdings, Inc.
2,337,670
152,299
Mellon Financial Corp.
2,074,100
71,411
SEI Investments Co.
53,900
2,635
585,804
Commercial Banks - 3.9%
Allied Irish Banks PLC
7,038,510
170,191
Anglo Irish Bank Corp. PLC
11,046,618
172,396
Banco Itau Holding Financeira SA sponsored ADR (non-vtg.)
961,800
28,046
Bank of Ireland
2,343,313
42,092
Commerce Bancorp, Inc., New Jersey (d)
1,275,800
45,508
Compass Bancshares, Inc.
1,085,473
60,352
Home Bancshares, Inc.
75,300
1,709
HSBC Holdings PLC sponsored ADR
995,107
87,918
M&T Bank Corp.
3,260,700
384,502
Marshall & Ilsley Corp.
343,200
15,698
National Australia Bank Ltd.
1,368,800
35,766
PNC Financial Services Group, Inc.
338,300
23,739
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Commercial Banks - continued
Royal Bank of Scotland Group PLC
5,270,200
$ 173,311
Shinhan Financial Group Co. Ltd.
603,290
28,298
Standard Chartered PLC (United Kingdom)
1,376,100
33,596
SunTrust Banks, Inc.
545,400
41,592
Uniao de Bancos Brasileiros SA (Unibanco) GDR
889,400
59,047
Wells Fargo & Co.
15,550,400
1,043,121
Zions Bancorp
686,946
53,541
2,500,423
Consumer Finance - 1.7%
American Express Co.
11,697,150
622,522
SLM Corp.
9,718,700
514,314
1,136,836
Diversified Financial Services - 1.7%
Bank of America Corp.
8,057,500
387,566
Citigroup, Inc.
5,930,800
286,102
JPMorgan Chase & Co.
6,334,100
266,032
Moody's Corp.
3,049,200
166,059
1,105,759
Insurance - 8.4%
ACE Ltd.
459,100
23,226
Admiral Group PLC
7,685,722
88,276
AFLAC, Inc.
871,700
40,403
Allstate Corp.
7,464,500
408,532
American International Group, Inc.
6,837,026
403,726
Assurant, Inc.
3,444,550
166,716
Axis Capital Holdings Ltd.
2,574,400
73,654
Berkshire Hathaway, Inc. Class A (a)
16,084
1,474,243
Cincinnati Financial Corp.
303,123
14,250
Everest Re Group Ltd.
3,027,120
262,058
Genworth Financial, Inc. Class A (non-vtg.)
4,865,400
169,511
Lincoln National Corp.
3,138,908
177,160
Loews Corp.
4,864,400
172,443
Markel Corp. (a)
42,750
14,834
MetLife, Inc.
8,937,000
457,664
MetLife, Inc. unit
3,634,300
100,198
Progressive Corp.
5,673,300
145,861
Prudential Financial, Inc.
5,701,400
442,999
SAFECO Corp.
237,000
13,355
StanCorp Financial Group, Inc.
1,118,000
56,917
Common Stocks - continued
Shares
Value (Note 1) (000s)
FINANCIALS - continued
Insurance - continued
The Chubb Corp.
7,812,700
$ 389,854
The St. Paul Travelers Companies, Inc.
1,558,900
69,496
W.R. Berkley Corp.
5,397,600
184,220
White Mountains Insurance Group Ltd.
162,850
79,308
Zenith National Insurance Corp.
901,900
35,778
5,464,682
Real Estate Investment Trusts - 0.3%
CBL & Associates Properties, Inc.
1,359,094
52,910
Equity Office Properties Trust
779,100
28,445
Equity Residential (SBI)
665,700
29,777
Vornado Realty Trust
960,800
93,726
204,858
Real Estate Management & Development - 0.2%
CB Richard Ellis Group, Inc. Class A (a)
4,117,670
102,530
Mitsui Fudosan Co. Ltd.
1,768,000
38,396
140,926
Thrifts & Mortgage Finance - 1.0%
Astoria Financial Corp.
505,600
15,396
Countrywide Financial Corp.
967,400
36,839
Golden West Financial Corp., Delaware
7,481,180
555,104
Hudson City Bancorp, Inc.
1,781,000
23,741
631,080
TOTAL FINANCIALS
11,770,368
HEALTH CARE - 10.0%
Biotechnology - 3.8%
Alexion Pharmaceuticals, Inc. (a)
228,400
8,250
Amylin Pharmaceuticals, Inc. (a)
2,191,764
108,207
Arena Pharmaceuticals, Inc. (a)(e)
2,989,583
34,619
Celgene Corp. (a)
4,734,750
224,569
Genentech, Inc. (a)
19,033,100
1,556,908
Genmab AS (a)
584,300
18,839
Gilead Sciences, Inc. (a)
5,526,001
326,918
Hutchison China Meditech Ltd.
441
2
MannKind Corp. (a)
3,043,028
64,847
MannKind Corp. warrants 8/3/10 (a)(g)
304,338
3,980
Medarex, Inc. (a)
5,647,464
54,272
Common Stocks - continued
Shares
Value (Note 1) (000s)
HEALTH CARE - continued
Biotechnology - continued
Myogen, Inc. (a)
817,276
$ 23,701
Renovis, Inc. (a)
264,900
4,056
Tanox, Inc. (a)
1,050,790
14,532
Theravance, Inc. (a)
274,800
6,287
ViaCell, Inc. (a)
689,400
3,137
2,453,124
Health Care Equipment & Supplies - 1.5%
Alcon, Inc.
476,000
46,910
Becton, Dickinson & Co.
462,600
28,279
C.R. Bard, Inc.
1,473,640
107,959
Conceptus, Inc. (a)
726,521
9,910
DENTSPLY International, Inc.
2,659,337
161,156
DexCom, Inc. (a)
894,320
12,145
Gen-Probe, Inc. (a)
1,838,600
99,248
Intuitive Surgical, Inc. (a)
454,119
53,572
Kyphon, Inc. (a)(e)
2,458,500
94,308
NeuroMetrix, Inc. (a)
312,000
9,504
Nobel Biocare Holding AG (Switzerland)
191,915
45,565
Northstar Neuroscience, Inc.
785,671
8,155
NuVasive, Inc. (a)
768,263
14,005
ResMed, Inc. (a)
2,208,100
103,670
St. Jude Medical, Inc. (a)
3,786,800
122,768
Viasys Healthcare, Inc. (a)
819,300
20,974
938,128
Health Care Providers & Services - 1.3%
Aetna, Inc.
9,570,727
382,159
American Retirement Corp. (a)
311,800
10,218
Health Net, Inc. (a)
690,970
31,211
Nighthawk Radiology Holdings, Inc.
112,200
2,013
Patterson Companies, Inc. (a)
6,610,876
230,918
UnitedHealth Group, Inc.
4,004,940
179,341
VCA Antech, Inc. (a)
1,011,670
32,303
Visicu, Inc.
100,700
1,777
869,940
Health Care Technology - 0.0%
Cerner Corp. (a)
42,400
1,573
Vital Images, Inc. (a)
545,501
13,474
15,047
Common Stocks - continued
Shares
Value (Note 1) (000s)
HEALTH CARE - continued
Life Sciences Tools & Services - 0.2%
Covance, Inc. (a)
594,900
$ 36,420
Exelixis, Inc. (a)
1,112,900
11,185
Pharmaceutical Product Development, Inc.
422,400
14,835
Thermo Electron Corp. (a)
2,002,000
72,552
134,992
Pharmaceuticals - 3.2%
Aspreva Pharmaceuticals Corp. (a)(e)
2,233,900
60,628
AstraZeneca PLC sponsored ADR
2,875,200
171,994
Barr Pharmaceuticals, Inc. (a)
96,000
4,578
Johnson & Johnson
3,468,100
207,809
Merck & Co., Inc.
5,792,850
211,034
New River Pharmaceuticals, Inc. (a)
364,400
10,385
Novartis AG sponsored ADR
5,436,800
293,152
Roche Holding AG (participation certificate)
5,526,718
913,660
Sanofi-Aventis sponsored ADR
3,048,111
148,443
Schering-Plough Corp.
529,000
10,067
Sepracor, Inc. (a)
124,100
7,091
Teva Pharmaceutical Industries Ltd. sponsored ADR
1,296,837
40,967
2,079,808
TOTAL HEALTH CARE
6,491,039
INDUSTRIALS - 8.9%
Aerospace & Defense - 0.8%
Armor Holdings, Inc. (a)
230,200
12,622
L-3 Communications Holdings, Inc.
11,800
890
Lockheed Martin Corp.
4,677,895
335,592
Northrop Grumman Corp.
726,700
46,552
Precision Castparts Corp.
257,800
15,406
Raytheon Co. warrants 6/16/11 (a)
132,461
1,676
The Boeing Co.
1,257,774
103,024
United Technologies Corp.
547,000
34,691
550,453
Air Freight & Logistics - 1.2%
C.H. Robinson Worldwide, Inc. (e)
9,353,349
498,534
Expeditors International of Washington, Inc.
185,920
10,413
FedEx Corp.
638,800
74,650
United Parcel Service, Inc. Class B
2,326,400
191,533
775,130
Common Stocks - continued
Shares
Value (Note 1) (000s)
INDUSTRIALS - continued
Airlines - 0.6%
Republic Airways Holdings, Inc. (a)
973,597
$ 16,571
Ryanair Holdings PLC sponsored ADR (a)
4,810,471
253,608
Southwest Airlines Co.
5,312,300
86,962
357,141
Commercial Services & Supplies - 0.5%
Aramark Corp. Class B
2,966,800
98,231
Brady Corp. Class A
1,054,800
38,859
Cendant Corp.
817,700
13,320
Monster Worldwide, Inc. (a)
408,441
17,424
Robert Half International, Inc.
3,214,749
135,019
The Brink's Co.
691,200
38,991
341,844
Construction & Engineering - 0.3%
Jacobs Engineering Group, Inc. (a)
2,288,066
182,222
URS Corp. (a)
397,700
16,703
198,925
Electrical Equipment - 1.0%
Cooper Industries Ltd. Class A
4,194,447
389,748
Evergreen Solar, Inc. (a)
376,740
4,890
Q-Cells AG
1,092,800
91,927
Roper Industries, Inc.
709,100
33,150
SolarWorld AG (d)
982,000
61,640
Suntech Power Holdings Co. Ltd. sponsored ADR
1,772,000
50,059
Ultralife Batteries, Inc. (a)(d)
704,358
7,135
638,549
Industrial Conglomerates - 0.8%
3M Co.
5,339,092
431,238
General Electric Co.
3,700
122
Hutchison Whampoa Ltd.
8,601,000
78,521
Siemens AG sponsored ADR
327,600
28,442
538,323
Machinery - 2.6%
Bucyrus International, Inc. Class A
424,607
21,443
Caterpillar, Inc.
3,413,603
254,245
Cummins, Inc.
1,101,300
134,634
Danaher Corp.
8,978,009
577,466
IDEX Corp. (e)
2,673,039
126,167
Common Stocks - continued
Shares
Value (Note 1) (000s)
INDUSTRIALS - continued
Machinery - continued
Joy Global, Inc.
4,018,925
$ 209,346
PACCAR, Inc.
4,082,857
336,346
1,659,647
Marine - 0.1%
American Commercial Lines, Inc.
956,180
57,610
Road & Rail - 0.8%
Canadian National Railway Co.
4,601,800
201,007
CSX Corp.
105,800
7,453
Heartland Express, Inc.
2,216,884
39,660
Knight Transportation, Inc.
1,817,326
36,710
Landstar System, Inc.
2,642,352
124,798
Norfolk Southern Corp.
652,900
34,747
Swift Transportation Co., Inc. (a)
2,007,966
63,773
508,148
Trading Companies & Distributors - 0.2%
Fastenal Co.
1,589,505
64,041
Mitsui & Co. Ltd.
6,194,000
87,477
151,518
TOTAL INDUSTRIALS
5,777,288
INFORMATION TECHNOLOGY - 17.2%
Communications Equipment - 1.5%
CommScope, Inc. (a)
285,200
8,961
Corning, Inc. (a)
4,443,000
107,476
ECI Telecom Ltd. (a)
2,594,100
20,908
F5 Networks, Inc. (a)
724,060
38,723
Harris Corp.
91,000
3,777
InterDigital Communication Corp. (a)
454,000
15,849
Motorola, Inc.
1,596,962
32,179
Nice Systems Ltd. sponsored ADR (a)
294,000
8,273
Nokia Corp. sponsored ADR
12,459,700
252,434
QUALCOMM, Inc.
12,066,200
483,493
TANDBERG Television ASA (a)
608,052
10,087
982,160
Computers & Peripherals - 3.1%
Apple Computer, Inc. (a)
12,419,436
709,398
Dell, Inc. (a)
1,605,300
39,185
Hewlett-Packard Co.
31,916,300
1,011,108
Common Stocks - continued
Shares
Value (Note 1) (000s)
INFORMATION TECHNOLOGY - continued
Computers & Peripherals - continued
Network Appliance, Inc. (a)
5,685,039
$ 200,682
Seagate Technology
1,372,000
31,062
1,991,435
Electronic Equipment & Instruments - 0.8%
Agilent Technologies, Inc. (a)
299,000
9,436
Amphenol Corp. Class A
2,214,030
123,897
FLIR Systems, Inc. (a)
974,133
21,489
Hon Hai Precision Industry Co. Ltd. (Foxconn)
16,160,238
99,821
Identix, Inc. (a)
179,500
1,255
Itron, Inc. (a)
630,500
37,363
Mettler-Toledo International, Inc. (a)
1,031,900
62,502
Motech Industries, Inc.
3,562,972
83,851
National Instruments Corp.
2,063,477
56,539
Viisage Technology, Inc. (a)
68,300
1,035
497,188
Internet Software & Services - 5.1%
Akamai Technologies, Inc. (a)
5,891,279
213,205
Google, Inc. Class A (sub. vtg.) (a)
5,820,280
2,440,618
LoopNet, Inc. (a)
121,300
2,257
NetEase.com, Inc. sponsored ADR (a)(d)
1,524,500
34,042
Tom Online, Inc. sponsored ADR (a)(d)
557,200
10,754
WebSideStory, Inc. (a)(e)
1,209,103
14,751
Yahoo!, Inc. (a)
18,301,570
603,952
3,319,579
IT Services - 1.7%
Alliance Data Systems Corp. (a)
2,267,700
133,386
CheckFree Corp. (a)
1,630,598
80,812
Cognizant Technology Solutions Corp. Class A (a)
3,874,941
261,055
First Data Corp.
3,647,900
164,301
Global Payments, Inc.
151,100
7,336
Infosys Technologies Ltd. sponsored ADR
747,300
57,101
Mastercard, Inc. Class A
2,583,500
124,008
MoneyGram International, Inc.
513,100
17,420
Paychex, Inc.
1,734,700
67,619
SRA International, Inc. Class A (a)(e)
3,726,200
99,229
The BISYS Group, Inc. (a)
942,400
12,911
VeriFone Holdings, Inc. (a)
2,970,800
90,550
1,115,728
Common Stocks - continued
Shares
Value (Note 1) (000s)
INFORMATION TECHNOLOGY - continued
Office Electronics - 0.1%
Canon, Inc. (d)
445,250
$ 21,749
Zebra Technologies Corp. Class A (a)
233,800
7,987
29,736
Semiconductors & Semiconductor Equipment - 3.7%
Applied Materials, Inc.
1,496,000
24,355
ASML Holding NV (NY Shares) (a)
3,044,200
61,554
Broadcom Corp. Class A (a)
6,479,174
194,699
FormFactor, Inc. (a)
1,349,800
60,242
Freescale Semiconductor, Inc. Class A (a)
168,800
4,895
Hittite Microwave Corp.
704,791
25,485
Lam Research Corp. (a)
4,273,386
199,225
Linear Technology Corp.
826,900
27,693
Marvell Technology Group Ltd. (a)(e)
17,947,000
795,591
MathStar, Inc.
304,900
1,805
MEMC Electronic Materials, Inc. (a)
2,564,100
96,154
Microchip Technology, Inc.
727,200
24,398
Monolithic Power Systems, Inc. (a)
863,122
10,211
National Semiconductor Corp.
4,726,700
112,732
Renewable Energy Corp. AS
1,355,775
19,387
Saifun Semiconductors Ltd.
685,000
19,625
Samsung Electronics Co. Ltd.
1,073,849
682,546
SiRF Technology Holdings, Inc. (a)
1,436,618
46,288
Zoran Corp. (a)
159,200
3,875
2,410,760
Software - 1.2%
Adobe Systems, Inc. (a)
6,226,120
189,025
Amdocs Ltd. (a)
331,200
12,122
Citrix Systems, Inc. (a)
1,262,411
50,673
ECtel Ltd. (a)
64,022
282
Informatica Corp. (a)
627,600
8,259
Intuit, Inc. (a)
4,003,190
241,753
NAVTEQ Corp. (a)
2,160,600
96,536
NDS Group PLC sponsored ADR (a)
274,400
12,773
Salesforce.com, Inc. (a)
1,684,200
44,901
SAP AG sponsored ADR
2,484,800
130,502
786,826
TOTAL INFORMATION TECHNOLOGY
11,133,412
Common Stocks - continued
Shares
Value (Note 1) (000s)
MATERIALS - 6.8%
Chemicals - 1.3%
Arkema sponsored ADR (a)
84,361
$ 3,261
Bayer AG
2,824,100
129,654
Celanese Corp. Class A
941,600
19,227
Ecolab, Inc.
6,361,929
258,167
Lonza Group AG
92,850
6,368
Monsanto Co.
1,258,700
105,970
Praxair, Inc.
5,589,572
301,837
Wacker Chemie AG
177,800
19,139
843,623
Construction Materials - 0.0%
Rinker Group Ltd.
1,965,958
23,946
Metals & Mining - 5.5%
Agnico-Eagle Mines Ltd.
1,419,600
47,066
Allegheny Technologies, Inc.
435,937
30,184
Anglo American PLC ADR
13,100,804
267,780
Bema Gold Corp. (a)(e)
24,609,400
122,793
BHP Billiton Ltd. sponsored ADR
10,854,030
467,483
Companhia Vale do Rio Doce sponsored ADR
797,318
19,168
Compass Minerals International, Inc.
705,900
17,612
Eldorado Gold Corp. (a)
9,022,400
43,807
First Quantum Minerals Ltd.
822,900
36,888
Gabriel Resources Ltd. (a)
8,498,100
22,001
Gerdau SA sponsored ADR
3,889,925
57,999
Glamis Gold Ltd. (a)(e)
11,243,516
426,252
Goldcorp, Inc.
10,839,078
326,736
IPSCO, Inc.
1,801,060
172,426
Ivanhoe Mines Ltd. (a)
5,199,800
35,215
Lihir Gold Ltd. (a)
23,175,852
49,603
Meridian Gold, Inc. (a)
1,261,400
39,798
New Gold, Inc. (a)(e)
1,416,100
12,610
New Gold, Inc. warrants 2/23/08 (a)
144,500
246
Newcrest Mining Ltd.
1,849,600
28,975
Newmont Mining Corp.
9,456,949
500,556
Novagold Resources, Inc. (a)
410,300
5,260
Nucor Corp.
3,405,900
184,770
Oregon Steel Mills, Inc. (a)
479,500
24,291
POSCO sponsored ADR
2,349,300
157,168
Rio Tinto PLC (Reg.)
7,540,709
395,340
Shore Gold, Inc. (a)
944,400
4,205
Common Stocks - continued
Shares
Value (Note 1) (000s)
MATERIALS - continued
Metals & Mining - continued
Steel Dynamics, Inc.
785,516
$ 51,640
US Gold Corp. (subscription receipt) (a)(g)
2,083,500
20,933
3,568,805
TOTAL MATERIALS
4,436,374
TELECOMMUNICATION SERVICES - 3.1%
Diversified Telecommunication Services - 0.5%
AT&T, Inc.
4,642,656
129,484
BT Group PLC sponsored ADR
677,000
29,984
Qwest Communications International, Inc. (a)
12,996,600
105,142
Telenor ASA
2,339,800
28,289
292,899
Wireless Telecommunication Services - 2.6%
America Movil SA de CV Series L sponsored ADR
29,747,500
989,402
American Tower Corp. Class A (a)
1,316,650
40,974
China Mobile (Hong Kong) Ltd. sponsored ADR
2,717,300
77,742
Hutchison Telecommunications International Ltd. sponsored ADR (a)
752,500
17,992
Leap Wireless International, Inc. (a)
723,169
34,314
NII Holdings, Inc. (a)(e)
9,376,394
528,641
1,689,065
TOTAL TELECOMMUNICATION SERVICES
1,981,964
UTILITIES - 0.7%
Electric Utilities - 0.2%
Exelon Corp.
740,100
42,060
FirstEnergy Corp.
869,200
47,119
89,179
Gas Utilities - 0.1%
Southern Union Co.
2,854,630
77,246
Independent Power Producers & Energy Traders - 0.3%
AES Corp. (a)
7,918,400
146,094
International Power PLC
2,878,200
15,145
TXU Corp.
755,600
45,177
206,416
Common Stocks - continued
Shares
Value (Note 1) (000s)
UTILITIES - continued
Multi-Utilities - 0.1%
National Grid PLC
5,330,800
$ 57,679
Veolia Environnement
336,300
17,384
75,063
TOTAL UTILITIES
447,904
TOTAL COMMON STOCKS
(Cost $45,595,709)
58,722,665
Convertible Preferred Stocks - 0.1%
CONSUMER DISCRETIONARY - 0.1%
Automobiles - 0.1%
General Motors Corp. Series B, 5.25% (cost $46,786)
2,820,000
51,634
Money Market Funds - 10.5%
Fidelity Cash Central Fund, 5.11% (b)
6,488,975,727
6,488,976
Fidelity Securities Lending Cash Central Fund, 5.14% (b)(c)
325,506,150
325,506
TOTAL MONEY MARKET FUNDS
(Cost $6,814,482)
6,814,482
TOTAL INVESTMENT PORTFOLIO - 101.0%
(Cost $52,456,977)
65,588,781
NET OTHER ASSETS - (1.0)%
(668,088)
NET ASSETS - 100%
$ 64,920,693
Legend
(a) Non-income producing
(b) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.
(c) Investment made with cash collateral received from securities on loan.
(d) Security or a portion of the security is on loan at period end.
(e) Affiliated company
(f) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the period end, the value of these securities amounted to $5,918,000 or 0.0% of net assets.
(g) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $66,147,000 or 0.1% of net assets.
Additional information on each holding is as follows:
Security
Acquisition Date
Acquisition Cost (000s)
MannKind Corp. warrants 8/3/10
8/3/05
$ 8
The Weinstein Co. Holdings, LLC Class A-1
10/19/05
$ 41,234
US Gold Corp. (subscription receipt)
2/8/06
$ 9,376
Affiliated Central Funds
Information regarding fiscal year to date income earned by the fund from the affiliated Central funds is as follows:
Fund
Income earned (Amounts in thousands)
Fidelity Cash Central Fund
$ 153,819
Fidelity Securities Lending Cash Central Fund
4,242
Total
$ 158,061
Other Affiliated Issuers
An affiliated company is a company in which the fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliates (Amounts in thousands)
Value, beginning of period
Purchases
Sales Proceeds
Dividend Income
Value, end of period
Altiris, Inc.
$ 44,317
$ -
$ 49,043
$ -
$ -
Anadys Pharmaceuticals, Inc.
14,939
588
8,779
-
-
Arena Pharmaceuticals, Inc.
34,354
9,652
-
-
34,619
Aspreva Pharmaceuticals Corp.
-
62,450
-
-
60,628
Bema Gold Corp.
45,577
37,840
-
-
122,793
Blackrock Ventures, Inc.
89,853
3,878
202,622
-
-
C.H. Robinson Worldwide, Inc.
342,379
33,896
28,981
2,396
498,534
Chipotle Mexican Grill, Inc. Class A
-
66,954
1,857
-
66,740
DENTSPLY International, Inc.
223,556
-
84,662
434
-
Eagle Materials, Inc.
65,585
25,706
95,004
191
-
Everest Re Group Ltd.
372,110
17,861
77,488
847
-
Foxhollow Technologies, Inc.
52,386
-
50,847
-
-
Glamis Gold Ltd.
263,267
72,523
8,526
-
426,252
IDEX Corp.
60,530
56,672
-
533
126,167
Intuitive Surgical, Inc.
277,909
13,026
222,597
-
-
iVillage, Inc.
31,794
-
33,697
-
-
Kyphon, Inc.
101,181
6,498
5,996
-
94,308
Mariner Energy, Inc.
32,788
-
35,643
-
-
Marvell Technology Group Ltd.
1,097,866
27,387
116,927
-
795,591
Merge Technologies, Inc.
35,964
-
24,868
-
-
New Gold, Inc.
5,009
5,401
-
-
12,610
NII Holdings, Inc.
391,001
60,586
37,200
-
528,641
Panera Bread Co. Class A
191,119
-
-
-
195,658
Patterson Companies, Inc.
353,807
-
134,775
-
-
Republic Airways Holdings, Inc.
34,351
-
18,313
-
-
Resources Connection, Inc.
69,522
-
69,084
-
-
Seattle Genetics, Inc.
11,693
-
12,469
-
-
SRA International, Inc. Class A
113,798
-
-
-
99,229
Ultralife Batteries, Inc.
12,819
-
3,959
-
-
WebSideStory, Inc.
15,418
6,872
-
-
14,751
Wet Seal, Inc. Class A
18,089
3,476
12,931
-
-
Total
$ 4,402,981
$ 511,266
$ 1,336,268
$ 4,401
$ 3,076,521
Other Information
Distribution of investments by country of issue, as a percentage of total net assets, is as follows:
United States of America
73.5%
Canada
6.1%
United Kingdom
3.4%
Bermuda
2.5%
Switzerland
2.3%
Netherlands Antilles
1.7%
Mexico
1.6%
Japan
1.4%
Korea (South)
1.3%
Ireland
1.1%
Others (individually less than 1%)
5.1%
100.0%
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amount)
June 30, 2006
Assets
Investment in securities, at value (including securities loaned of $321,789) - See accompanying schedule:
Unaffiliated issuers (cost $43,839,577)
$ 55,697,778
Affiliated Central Funds (cost $6,814,482)
6,814,482
Other affiliated issuers (cost $1,802,918)
3,076,521
Total Investments (cost $52,456,977)
$ 65,588,781
Cash
2
Foreign currency held at value (cost $2,085)
2,085
Receivable for investments sold
293,263
Receivable for fund shares sold
70,258
Dividends receivable
45,251
Interest receivable
30,514
Prepaid expenses
102
Other receivables
2,340
Total assets
66,032,596
Liabilities
Payable for investments purchased
$ 678,198
Payable for fund shares redeemed
58,198
Accrued management fee
37,387
Other affiliated payables
10,680
Other payables and accrued expenses
1,934
Collateral on securities loaned, at value
325,506
Total liabilities
1,111,903
Net Assets
$ 64,920,693
Net Assets consist of:
Paid in capital
$ 46,092,393
Undistributed net investment income
169,154
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions
5,527,564
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies
13,131,582
Net Assets, for 983,165 shares outstanding
$ 64,920,693
Net Asset Value, offering price and redemption price per share ($64,920,693 ÷ 983,165 shares)
$ 66.03
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements - continued
Statement of Operations
Amounts in thousands
Six months ended June 30, 2006
Investment Income
Dividends (including $4,401 received from other affiliated issuers)
$ 291,596
Interest
1,984
Income from affiliated Central Funds
158,061
Total income
451,641
Expenses
Management fee Basic fee
$ 182,652
Performance adjustment
43,466
Transfer agent fees
56,214
Accounting and security lending fees
1,340
Independent trustees' compensation
122
Appreciation in deferred trustee compensation account
60
Custodian fees and expenses
2,673
Registration fees
703
Audit
227
Legal
384
Interest
1
Miscellaneous
1,161
Total expenses before reductions
289,003
Expense reductions
(4,498)
284,505
Net investment income (loss)
167,136
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investment securities:
Unaffiliated issuers (net of foreign taxes of $280)
5,037,719
Other affiliated issuers
580,188
Foreign currency transactions
1,165
Total net realized gain (loss)
5,619,072
Change in net unrealized appreciation (depreciation) on:
Investment securities (net of decrease in deferred foreign taxes of $234)
(3,433,073)
Assets and liabilities in foreign currencies
(161)
Total change in net unrealized appreciation (depreciation)
(3,433,234)
Net gain (loss)
2,185,838
Net increase (decrease) in net assets resulting from operations
$ 2,352,974
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Statement of Changes in Net Assets
Amounts in thousands
Six months ended June 30, 2006
Year ended December 31, 2005
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)
$ 167,136
$ 232,458
Net realized gain (loss)
5,619,072
3,808,762
Change in net unrealized appreciation (depreciation)
(3,433,234)
3,905,671
Net increase (decrease) in net assets resulting from operations
2,352,974
7,946,891
Distributions to shareholders from net investment income
-
(209,102)
Distributions to shareholders from net realized gain
(1,219,235)
(880,727)
Total distributions
(1,219,235)
(1,089,829)
Share transactions Proceeds from sales of shares
8,333,651
14,203,241
Reinvestment of distributions
1,193,080
1,065,991
Cost of shares redeemed
(5,882,505)
(6,460,467)
Net increase (decrease) in net assets resulting from share transactions
3,644,226
8,808,765
Total increase (decrease) in net assets
4,777,965
15,665,827
Net Assets
Beginning of period
60,142,728
44,476,901
End of period (including undistributed net investment income of $169,154 and undistributed net investment income of $14,566, respectively)
$ 64,920,693
$ 60,142,728
Other Information
Shares
Sold
125,297
236,315
Issued in reinvestment of distributions
18,168
16,305
Redeemed
(89,007)
(107,831)
Net increase (decrease)
54,458
144,789
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Highlights
Six months ended June 30,
Years ended December 31,
2006
2005
2004
2003
2002
2001
Selected Per-Share Data
Net asset value, beginning of period
$ 64.76
$ 56.74
$ 49.35
$ 38.60
$ 42.77
$ 49.18
Income from Investment Operations
Net investment income (loss) E
.17
.27
.04
- G
.06
.21
Net realized and unrealized gain (loss)
2.38
8.95
7.40
10.79
(4.18)
(6.40)
Total from investment operations
2.55
9.22
7.44
10.79
(4.12)
(6.19)
Distributions from net investment income
-
(.23)
(.05)
(.04)
(.05)
(.22)
Distributions from net realized gain
(1.28)
(.97)
-
-
-
-
Total distributions
(1.28)
(1.20)
(.05)
(.04)
(.05)
(.22)
Net asset value, end of period
$ 66.03
$ 64.76
$ 56.74
$ 49.35
$ 38.60
$ 42.77
Total ReturnB, C, D
3.95%
16.23%
15.07%
27.95%
(9.63)%
(12.59)%
Ratios to Average Net AssetsF
Expenses before reductions
.90% A
.91%
.94%
1.00%
1.03%
.96%
Expenses net of fee waivers, if any
.90% A
.91%
.94%
1.00%
1.03%
.96%
Expenses net of all reductions
.88% A
.88%
.92%
.98%
.99%
.91%
Net investment income (loss)
.52% A
.46%
.08%
.01%
.14%
.49%
Supplemental Data
Net assets, end of period (in millions)
$ 64,921
$ 60,143
$ 44,477
$ 35,933
$ 27,586
$ 32,159
Portfolio turnover rate
78% A
60%
64%
67%
80%
141%
A Annualized
BTotal returns for periods of less than one year are not annualized.
CTotal returns would have been lower had certain expenses not been reduced during the periods shown.
DTotal returns do not include the effect of the former sales charges.
ECalculated based on average shares outstanding during the period.
FExpense ratios reflect operating expenses of thefund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the fund.
GAmount represents less than $.01 per share.
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Notes to Financial Statements
For the period ended June 30, 2006
(Amounts in thousands except ratios)
1. Significant Accounting Policies.
Fidelity Contrafund (the Fund) is a fund of Fidelity Contrafund (the trust) and is authorized to issue an unlimited number of shares. Effective the close of business on April 28, 2006, the Fund was closed to most new accounts. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund may invest in affiliated money market central funds (Money Market Central Funds), which are open-end investment companies available to investment companies and other accounts managed by Fidelity Management & Research Company (FMR) and its affiliates. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, 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 Fund:
Security Valuation. Investments are valued and net asset value (NAV) per share is calculated (NAV calculation) as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time. Wherever possible, the Fund uses independent pricing services approved by the Board of Trustees to value its investments.
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price. Debt securities, including restricted securities, for which quotations are readily available, are valued by independent pricing services or by dealers who make markets in such securities. Pricing services consider yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied prices. Investments in open-end mutual funds are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.
When current market prices or quotations are not readily available or do not accurately reflect fair value, valuations may be determined in accordance with procedures adopted by the Board of Trustees. For example, when developments occur between the close of a market and the close of the NYSE that may materially affect the value of some or all of the securities, or when trading in a security is halted, those securities may be fair valued. Factors used in the determination of fair value may include monitoring news to identify significant market or security specific events such as changes in the value of U.S. securities markets, reviewing developments in foreign markets and evaluating the performance of ADRs, futures contracts and exchange-traded funds. Because the Fund's utilization of fair value pricing depends on market activity, the frequency with which fair
Semiannual Report
Notes to Financial Statements - continued
(Amounts in thousands except ratios)
1. Significant Accounting Policies - continued
Security Valuation - continued
value pricing is used can not be predicted and may be utilized to a significant extent. The value of securities used for NAV calculation under fair value pricing may differ from published prices for the same securities.
Foreign Currency. The Fund uses foreign currency contracts to facilitate transactions in foreign-denominated securities. Losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rate at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. Security transactions are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost and may include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Distributions received on securities that represent a return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The Fund estimates the components of distributions received that may be considered return of capital distributions or capital gain distributions. Interest income and distributions from the Central Funds are accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust.
Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), independent Trustees must defer receipt of a portion of, and may elect to defer receipt of an additional portion of, their annual compensation. Prior to July 1, 2006, deferred amounts were treated as though equivalent dollar amounts had been invested in a
Semiannual Report
1. Significant Accounting Policies - continued
Deferred Trustee Compensation - continued
cross-section of other Fidelity funds, and were marked-to-market. Effective July 1, 2006, deferred amounts will be directly invested in a cross-section of Fidelity funds. Deferred amounts remain in the Fund until distributed in accordance with the plan.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company by distributing all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code. As a result, no provision for income taxes is required in the accompanying financial statements. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles. In addition, the Fund claimed a portion of the payment made to redeeming shareholders as a distribution for income tax purposes.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences will reverse in a subsequent period.
Book-tax differences are primarily due to short-term capital gains, foreign currency transactions, passive foreign investment companies (PFIC), market discount, deferred trustees compensation, capital loss carryforwards and losses deferred due to wash sales.
The federal tax cost of investments and unrealized appreciation (depreciation) as of period end were as follows:
Unrealized appreciation
$ 14,092,000
Unrealized depreciation
(1,026,802)
Net unrealized appreciation (depreciation)
$ 13,065,198
Cost for federal income tax purposes
$ 52,523,583
New Accounting Pronouncement. In July 2006, Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement 109 (FIN 48)was issued and is effective for fiscal years beginning after December 15, 2006. FIN 48 sets forth a threshold for financial statement recognition, measurement and disclosure of a tax position taken or expected to be taken on a tax return. Management is currently evaluating the impact, if any, the adoption of FIN 48 will have on the Fund's net assets and results of operations.
Semiannual Report
Notes to Financial Statements - continued
(Amounts in thousands except ratios)
2. Operating Policies.
Repurchase Agreements. FMR has received an Exemptive Order from the Securities and Exchange Commission (the SEC) which permits the Fund and other affiliated entities of FMR to transfer uninvested cash balances into joint trading accounts which are then invested in repurchase agreements. The Fund may also invest directly with institutions in repurchase agreements. Repurchase agreements are collateralized by government or non-government securities. Upon settlement date, collateral is held in segregated accounts with custodian banks and may be obtained in the event of a default of the counterparty. The Fund monitors, on a daily basis, the value of the collateral to ensure it is at least equal to the principal amount of the repurchase agreement (including accrued interest). In the event of a default by the counterparty, realization of the collateral proceeds could be delayed, during which time the value of the collateral may decline.
Restricted Securities. The Fund may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of the Fund's Schedule of Investments.
3. Purchases and Sales of Investments.
Purchases and sales of securities including the Central Funds, other than short-term securities and U.S. government securities, aggregated $24,764,770 and $22,401,950, respectively.
4. Fees and Other Transactions with Affiliates.
Management Fee. FMR and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and a group fee rate that averaged ..27% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of ±.20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the Fund's relative investment performance as compared to an appropriate benchmark index. For the period, the total annualized management fee rate, including the performance adjustment, was .70% of the Fund's average net assets.
Semiannual Report
4. Fees and Other Transactions with Affiliates - continued
Transfer Agent Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, is the Fund's transfer, dividend disbursing and shareholder servicing agent. FSC receives account fees and asset-based fees that vary according to account size and type of account. FSC pays for typesetting, printing and mailing of shareholder reports, except proxy statements. For the period, the transfer agent fees were equivalent to an annualized rate of .17% of average net assets.
Accounting and Security Lending Fees. FSC maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for the month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions.
Affiliated Central Funds. The Fund may invest in Money Market Central Funds which seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR.
The Money Market Central Funds do not pay a management fee.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $107 for the period.
5. Committed Line of Credit.
The Fund participates with other funds managed by FMR in a $4.2 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro rata portion of the line of credit, which amounts to $90 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.
6. Security Lending.
The Fund lends portfolio securities from time to time in order to earn additional income. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. If the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, a fund could experience delays and costs in recovering the securities loaned or in gaining access to
Semiannual Report
Notes to Financial Statements - continued
(Amounts in thousands except ratios)
6. Security Lending - continued
the collateral. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less fees and expenses associated with the loan, plus any premium payments that may be received on the loan of certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from affiliated central funds. Net income from lending portfolio securities during the period amounted to $4,242.
7. Bank Borrowings.
The Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. The Fund has established borrowing arrangements with certain banks. The interest rate on the borrowings is the bank's base rate, as revised from time to time. The average daily loan balance during the period for which loans were outstanding amounted to $5,924. The weighted average interest rate was 5.00%. At period end, there were no bank borrowings outstanding.
8. Expense Reductions.
Many of the brokers with whom FMR places trades on behalf of the Fund provided services to the Fund in addition to trade execution. These services included payments of certain expenses on behalf of the Fund totaling $3,344 for the period. In addition, through arrangements with the Fund's custodian and transfer agent, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody and transfer agent expenses by $9 and $1,145, respectively.
9. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Semiannual Report
Report of Independent Registered Public Accounting Firm
To the Trustees of Fidelity Contrafund and the Shareholders of Fidelity Contrafund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Fidelity Contrafund (a fund of Fidelity Contrafund) at June 30, 2006, and the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fidelity Contrafund'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 the standards of the Public Company Accounting Oversight Board (United States). Those standards 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 June 30, 2006 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
August 14, 2006
Semiannual Report
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Contrafund
On January 19, 2006, the Board of Trustees, including the Independent Trustees (together, the Board), voted to approve a general research services agreement (the Agreement) between FMR, FMR Co., Inc. (FMRC), Fidelity Investments Money Management, Inc. (FIMM), and Fidelity Research & Analysis Company (FRAC) (together, the Investment Advisers) for the fund, effective January 20, 2006, pursuant to which FRAC may provide general research and investment advisory support services to FMRC and FIMM. The Board considered that it has approved previously various sub-advisory agreements for the fund with affiliates of FMR that allow FMR to obtain research, non-discretionary advice, or discretionary portfolio management at no additional expense to the fund. The Board, assisted by the advice of fund counsel and independent Trustees' counsel, considered a broad range of information and determined that it would be beneficial for the fund to access the research and investment advisory support services supplied by FRAC at no additional expense to the fund.
The Board reached this determination in part because the new arrangement will involve no changes in (i) the contractual terms of and fees payable under the fund's management contract or sub-advisory agreements; (ii) the investment process or strategies employed in the management of the fund's assets; (iii) the nature or level of services provided under the fund's management contract or sub-advisory agreements; (iv) the day-to-day management of the fund or the persons primarily responsible for such management; or (v) the ultimate control or beneficial ownership of FMR, FMRC, or FIMM. The Board also considered that the establishment of the Agreement would not necessitate prior shareholder approval of the Agreement or result in an assignment and termination of the fund's management contract or sub-advisory agreements under the Investment Company Act of 1940.
Because the Board was approving an arrangement with FRAC under which the fund will not bear any additional management fees or expenses and under which the fund's portfolio manager would not change, it did not consider the fund's investment performance, competitiveness of management fee and total expenses, costs of services and profitability, or economies of scale to be significant factors in its decision.
In connection with its future renewal of the fund's management contract and sub-advisory agreements, the Board will consider: (i) the nature, extent, and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the fund's management fee and total expenses; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred by Fidelity in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders; and (iv) whether there have been economies of scale in respect of the management of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is potential for realization of any further economies.
Semiannual Report
Board Approval of Investment Advisory Contracts and Management Fees - continued
Based on its evaluation of all of the conclusions noted above, and after considering all material factors, the Board ultimately concluded that the fund's Agreement is fair and reasonable, and that the fund's Agreement should be approved.
Semiannual Report
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 Automated Service Telephone 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)
Fidelity Automated Service Telephone (FAST®) 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
* 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.
Semiannual Report
To Visit Fidelity
For directions and hours, please call 1-800-544-9797.
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1907 West State Road 434 Longwood, FL
8880 Tamiami Trail, North Naples, FL
3501 PGA Boulevard Palm Beach Gardens, FL
3550 Tamiami Trail, South Sarasota, FL
1502 N. Westshore Blvd. Tampa, FL
2465 State Road 7 Wellington, FL
Georgia
3445 Peachtree Road, N.E. Atlanta, GA
1000 Abernathy Road Atlanta, GA
Illinois
One North LaSalle Street Chicago, IL
875 North Michigan Ave. Chicago, IL
1415 West 22nd Street Oak Brook, IL
1572 East Golf Road Schaumburg, IL
3232 Lake Avenue Wilmette, IL
Indiana
4729 East 82nd Street Indianapolis, IN
Kansas
5400 College Boulevard Overland Park, KS
Maine
Three Canal Plaza Portland, ME
Maryland
7315 Wisconsin Avenue Bethesda, MD
One W. Pennsylvania Ave. Towson, MD
Massachusetts
801 Boylston Street Boston, MA
155 Congress Street Boston, MA
300 Granite Street Braintree, MA
44 Mall Road Burlington, MA
238 Main Street Cambridge, MA
405 Cochituate Road Framingham, MA
416 Belmont Street Worcester, MA
Fidelity Brokerage Services, Inc., 100 Summer St., Boston, MA 02110 Member NYSE/SIPC
Semiannual Report
Michigan
500 E. Eisenhower Pkwy. Ann Arbor, MI
280 Old N. Woodward Ave. Birmingham, MI
43420 Grand River Avenue Novi, MI
29155 Northwestern Hwy. Southfield, MI
Minnesota
7600 France Avenue South Edina, MN
Missouri
1524 South Lindbergh Blvd. St. Louis, MO
Nevada
2225 Village Walk Drive Henderson, NV
New Jersey
150 Essex Street Millburn, NJ
56 South Street Morristown, NJ
396 Route 17, North Paramus, NJ
3518 Route 1 North Princeton, NJ
530 Broad Street Shrewsbury, NJ
New York
1055 Franklin Avenue Garden City, NY
37 West Jericho Turnpike Huntington Station, NY
1271 Avenue of the Americas New York, NY
980 Madison Avenue New York, NY
61 Broadway New York, NY
350 Park Avenue New York, NY
200 Fifth Avenue New York, NY
733 Third Avenue New York, NY
11 Penn Plaza New York, NY
2070 Broadway New York, NY
1075 Northern Blvd. Roslyn, NY
799 Central Park Avenue Scarsdale, NY
North Carolina
4611 Sharon Road Charlotte, NC
7011 Fayetteville Road Durham, NC
Ohio
3805 Edwards Road Cincinnati, OH
1324 Polaris Parkway Columbus, OH
28699 Chagrin Boulevard Woodmere Village, OH
Oregon
7493 SW Bridgeport Road Tigard, OR
Pennsylvania
600 West DeKalb Pike King of Prussia, PA
1735 Market Street Philadelphia, PA
12001 Perry Highway Wexford, PA
Rhode Island
47 Providence Place Providence, RI
Tennessee
6150 Poplar Avenue Memphis, TN
Texas
10000 Research Boulevard Austin, TX
4001 Northwest Parkway Dallas, TX
12532 Memorial Drive Houston, TX
2701 Drexel Drive Houston, TX
6560 Fannin Street Houston, TX
6500 N. MacArthur Blvd. Irving, TX
6005 West Park Boulevard Plano, TX
14100 San Pedro San Antonio, TX
1576 East Southlake Blvd. Southlake, TX
19740 IH 45 North Spring, TX
Utah
279 West South Temple Salt Lake City, UT
Virginia
1861 International Drive McLean, VA
Washington
411 108th Avenue, N.E. Bellevue, WA
1518 6th Avenue Seattle, WA
Washington, DC
1900 K Street, N.W. Washington, DC
Wisconsin
595 North Barker Road Brookfield, WI
Semiannual Report
To Write Fidelity
We'll give your correspondence immediate attention and send you written confirmation upon completion of your request.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies
Not applicable.
Item 9. Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders
There were no material changes to the procedures by which shareholders may recommend nominees to the Fidelity Contrafund's Board of Trustees.
Item 11. Controls and Procedures
(a)(i) The President and Treasurer and the Chief Financial Officer have concluded that the Fidelity Contrafund's (the "Trust") disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) provide reasonable assurances that material information relating to the Trust is made known to them by the appropriate persons, based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.
(a)(ii) There was no change in the Trust's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Trust's internal control over financial reporting.
Item 12. Exhibits
(a)
(1)
Not applicable.
(a)
(2)
Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT.
(a)
(3)
Not applicable.
(b)
Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Fidelity Contrafund
By:
/s/Christine Reynolds
Christine Reynolds
President and Treasurer
Date:
August 17, 2006
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By:
/s/Christine Reynolds
Christine Reynolds
President and Treasurer
Date:
August 17, 2006
By:
/s/Joseph B. Hollis
Joseph B. Hollis
Chief Financial Officer
Date:
August 17, 2006
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